EXHIBIT 10.44
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SECOND AMENDED AND RESTATED
RECEIVABLES SALE AGREEMENT
DATED AS XX XXXXXX 00, 0000
XXXXX
XXXXXXXX & XXXXXXX RECEIVABLES CORPORATION,
AS THE SELLER,
CROMPTON CORPORATION,
as the Initial Collection Agent,
ABN AMRO BANK N.V.,
AS THE AGENT,
THE LIQUIDITY PROVIDERS
FROM TIME TO TIME PARTY HERETO,
AND
AMSTERDAM FUNDING CORPORATION
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TABLE OF CONTENTS
PAGE
ARTICLE I PURCHASES FROM SELLER AND SETTLEMENTS....................1
Section 1.1. Sales....................................................1
Section 1.2. Interim Liquidations.....................................3
Section 1.3. Section of Discount Rates and Tranche Periods............4
Section 1.4. Fees and Other Costs and Expenses........................5
Section 1.5. Maintenance of Sold Interest; Deemed Collection..........5
Section 1.6. Reduction in Commitments.................................6
Section 1.7. Repurchases..............................................6
Section 1.8. Assignment of Purchase Agreements........................7
Section 1.9. Extension of Liquidity Termination Date..................7
ARTICLE II SALES TO AND FROM AMSTERDAM; ALLOCATIONS.................7
Section 2.1. Required Purchases from Amsterdam........................7
Section 2.2. Purchases by Amsterdam...................................8
Section 2.3. Allocations and Distributions............................8
ARTICLE III ADMINISTRATION AND COLLECTIONS..........................10
Section 3.1. Appointment of Collection Agent.........................10
Section 3.2. Duties of Collection Agent..............................10
Section 3.3. Reports.................................................11
Section 3.4. Lock-Box Arrangements...................................11
Section 3.5. Enforcement Rights......................................11
Section 3.6. Collection Agent Fee....................................12
Section 3.7. Responsibilities of the Seller..........................12
Section 3.8. Actions by Seller.......................................12
Section 3.9. Indemnities by the Collection Agent.....................13
Section 3.10. Exchange Agent; Currency Conversion.....................14
ARTICLE IV REPRESENTATIONS AND WARRANTIES..........................14
Section 4.1. Representations and Warranties..........................14
ARTICLE V COVENANTS...............................................16
Section 5.1. Covenants of the Seller.................................16
ARTICLE VI INDEMNIFICATION.........................................21
Section 6.1. Indemnities by the Seller...............................21
Section 6.2. Increased Cost and Reduced Return.......................23
Section 6.3. Other Costs and Expenses................................23
Section 6.4. Withholding Taxes.......................................24
Section 6.5. Payments and Allocations................................24
ARTICLE VII CONDITIONS PRECEDENT....................................24
Section 7.1. Conditions to Closing...................................24
Section 7.2. Conditions to Each Purchase.............................25
ARTICLE VIII THE AGENT...............................................25
Section 8.1. Appointment and Authorization...........................25
Section 8.2. Delegation of Duties....................................26
Section 8.3. Exculpatory Provisions..................................26
Section 8.4. Reliance by Agent.......................................26
Section 8.5. Assumed Payments........................................26
Section 8.6. Notice of Termination Events............................26
Section 8.7. Non-Reliance on Agent and Other Purchasers..............27
Section 8.8. Agent and Affiliates....................................27
Section 8.9. Indemnification.........................................27
Section 8.10. Successor Agent.........................................27
ARTICLE IX MISCELLANEOUS...........................................28
Section 9.1. Termination.............................................28
Section 9.2. Notices.................................................28
Section 9.3. Payments and Computations...............................28
Section 9.4. Sharing of Recoveries...................................29
Section 9.5. Right of Setoff.........................................29
Section 9.6. Amendments..............................................29
Section 9.7. Waivers.................................................30
Section 9.8. Successors and Assigns; Participations; Assignments.....30
Section 9.9. Intended Tax Characterization...........................32
Section 9.10. Waiver of Confidentiality...............................32
Section 9.11. Confidentiality of Agreement............................32
Section 9.12. Agreement Not to Petition...............................32
Section 9.13. Excess Funds............................................33
Section 9.14. No Recourse.............................................33
Section 9.15. Limitation of Liability.................................33
Section 9.16. Headings; Counterparts..................................33
Section 9.17. Cumulative Rights and Severability......................33
Section 9.18. Governing Law; Submission to Jurisdiction...............34
Section 9.19. WAIVER OF TRIAL BY JURY.................................34
Section 9.20. Entire Agreement........................................34
Section 9.21. Elimination of Enhancer.................................34
Section 9.22. Original Agreement......................................34
Signature.....................................................................35
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SCHEDULES DESCRIPTION
Schedule I Definitions
Schedule II Liquidity Providers and Commitments of Committed Purchasers
EXHIBITS DESCRIPTION
Exhibit A Form of Incremental Purchase Request
Exhibit B Form of Notification of Assignment from the Committed
Purchasers to Amsterdam
Exhibit C-1 Form of Periodic Report
Exhibit C-2 Form of Weekly Report
Exhibit C-3 Form of Daily Report
Exhibit D Addresses and Names of Seller and Originator
Exhibit E Subsidiaries
Exhibit F Lock-Boxes and Lock-Box Banks
Exhibit G Form of Lock-Box Letter
Exhibit H Compliance Certificate
Exhibit I Credit and Collection Policy
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SECOND AMENDED AND RESTATED
RECEIVABLES SALE AGREEMENT
THIS SECOND AMENDED AND RESTATED RECEIVABLES SALE AGREEMENT, dated as
of August 16, 2004, among Crompton & Xxxxxxx Receivables Corporation, a Delaware
corporation, as Seller (the "Seller"), Crompton Corporation, a Delaware
corporation, as the initial Collection Agent (the "Initial Collection Agent"),
ABN AMRO Bank N.V., as agent for the Purchasers (the "Agent"), the liquidity
providers party hereto (the "Liquidity Providers") and Amsterdam Funding
Corporation ("Amsterdam"). Certain capitalized terms used herein, and certain
rules of construction, are defined in Schedule I. The sole initial Liquidity
Provider and the Commitments of all Committed Purchasers are listed on Schedule
II.
PRELIMINARY STATEMENT
The Seller, Initial Collection Agent, Amsterdam, ABN AMRO Bank N.V., as
provider of the Program LOC (the "Enhancer"), the Liquidity Provider and the
Agent are parties to an Amended and Restated Receivables Sale Agreement, dated
as of January 18, 2002 (as amended, modified or supplemented prior to the date
hereof, the "Original Agreement"); and
Subject to and upon the terms and conditions set forth herein, the
parties desire to remove the Enhancer, remove Crompton Europe B.V. and Crompton
B.V. as Originators hereunder and to amend and restate the Original Agreement in
the form of this Agreement. This Agreement amends and replaces in its entirety
the Original Agreement and, from and after the date hereof, all references made
to the Original Agreement in any Transaction Document or in any other instrument
or document shall, without more, be deemed to refer to this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein and the other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I
PURCHASES FROM SELLER AND SETTLEMENTS
Section 1.1. Sales.
(a) The Sold Interest. Subject to the terms and conditions hereof, the
Seller may, from time to time before the Liquidity Termination Date, sell to
Amsterdam, or, only if Amsterdam declines to make the applicable purchase,
ratably to the Committed Purchasers an undivided percentage ownership interest
in the Receivables and all related Collections. Any such purchase (a "Purchase")
shall be made by each relevant Purchaser remitting funds to the Seller, through
the Agent, pursuant to Section 1.1(c) or by the Collection Agent remitting
Collections to the Seller pursuant to Section 1.1(d). The aggregate percentage
ownership interest so acquired by a Purchaser in the Receivables and related
Collections (its "Purchase Interest") shall equal at any time the following
quotient:
I + PRP
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ER
where:
I = the outstanding Investment of such Purchaser at such time;
ER = the Eligible Receivables Balance at such time; and
PRP = the Purchaser Reserve Percentage at such time.
Except during a Liquidation Period for a Purchaser, such Purchaser's Purchase
Interest will change whenever its Investment, its Purchaser Reserve Percentage
or the Eligible Receivables Balance changes. During a Liquidation Period for a
Purchaser its Purchase Interest shall remain constant, except for
redeterminations to reflect Investment acquired from or transferred to another
Purchaser hereunder or under the Transfer Agreement. The sum of all Purchasers'
Purchase Interests at any time is referred to herein as the "Sold Interest",
which at any time is the aggregate percentage ownership interest then held by
the Purchasers in the Receivables and Collections.
(b) Amsterdam Purchase Option and Other Purchasers' Commitments.
Subject to Section 1.1(d) concerning Reinvestment Purchases, at no time will
Amsterdam have any obligation to make a Purchase. Each Liquidity Provider
(together the "Committed Purchasers" and each a "Committed Purchaser") severally
hereby agrees, subject to Section 7.2 and the other terms and conditions hereof,
to make Purchases before the Liquidity Termination Date, based on its Ratable
Share of each Purchase by the Committed Purchasers, to the extent its Investment
would not thereby exceed its Commitment, the Aggregate Investment would not
thereby exceed the Purchase Limit, and the Matured Aggregate Investment would
not thereby exceed the Aggregate Commitments. Each Purchaser's first Purchase
and each additional Purchase by such Purchaser not made from Collections
pursuant to Section 1.1(d) is referred to herein as an "Incremental Purchase."
Each Purchase made by a Purchaser with the proceeds of Collections in which it
has a Purchase Interest, which does not increase the outstanding Investment of
such Purchaser, is referred to herein as a "Reinvestment Purchase."
(c) Incremental Purchases. In order to request an Incremental Purchase
from a Purchaser, the Seller must provide to the Agent an irrevocable written
request (including by telecopier or other facsimile communication) substantially
in the form of Exhibit A, by 10:00 a.m. (Chicago time) three Business Days
before the requested date (the "Purchase Date") of such Purchase, specifying the
requested Purchase Date (which must be a Business Day) and the requested amount
(the "Purchase Amount") of such Purchase, which must be in a minimum amount of
$1,000,000 and multiples thereof (or, if less, an amount equal to the Maximum
Incremental Purchase Amount). An Incremental Purchase may only be requested from
Amsterdam unless Amsterdam, in its sole discretion, determines not to make such
Incremental Purchase in which case the Seller will automatically be deemed to
have requested such Incremental Purchase from the Committed Purchasers. The
Agent shall promptly notify the contents of any such request to each Purchaser
from which the Purchase is requested. If Amsterdam determines, in its sole
discretion, to make the requested Purchase, Amsterdam shall transfer to the
Agent's Account the amount of such Incremental Purchase on the requested
Purchase Date. If Amsterdam refuses to make a requested Purchase, the Seller
shall automatically be deemed to have requested the Incremental Purchase from
the Committed Purchasers, subject to Section 7.2 and the other terms and
conditions hereof, each Committed Purchaser shall transfer its Ratable Share of
the requested Purchase Amount into the Agent's Account by no later than 12:00
noon (Chicago time) on the Purchase Date. The Agent shall transfer to the
Designated Account the proceeds of any Incremental Purchase delivered into the
Agent's Account.
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(d) Reinvestment Purchases. Unless Amsterdam has provided to the Agent,
the Seller, and the Collection Agent a notice still in effect that it no longer
wishes to make Reinvestment Purchases (in which case Amsterdam's Reinvestment
Purchases, but not those of the Committed Purchasers, shall cease), at any time
before the Liquidity Termination Date when no Interim Liquidation is in effect,
on each day that any Collections are received by the Collection Agent a
Purchaser's Purchase Interest in such Collections shall automatically be used to
make a Reinvestment Purchase by such Purchaser, but only to the extent such
Reinvestment Purchase would not cause the Purchaser's Investment to increase
above the amount of such Investment at the start of the day plus any Incremental
Purchases made by the Purchaser on that day. Amsterdam may revoke any notice
provided under the first sentence of this Section 1.1(d) by notifying the Agent,
the Seller, and the Collection Agent that it will make Reinvestment Purchases.
(e) Security Interest. To secure all of the Seller's obligations under
the Transaction Documents, the Seller hereby grants to the Agent (for the
benefit of the Purchasers) a security interest in all of the Seller's rights in
the Receivables, the Collections, and the Lock- Box Accounts.
Section 1.2. Interim Liquidations. (a) Optional. The Seller may at any
time direct that Reinvestment Purchases cease and that an Interim Liquidation
commence for all Purchasers by giving the Agent and the Collection Agent at
least three Business Days' written (including telecopy or other facsimile
communication) notice specifying the date on which the Interim Liquidation shall
commence and, if desired, when such Interim Liquidation shall cease before the
Liquidity Termination Date (identified as a specific date or as when the
Aggregate Investment is reduced to a specified amount). If the Seller does not
so specify the date on which an Interim Liquidation shall cease, it may cause
such Interim Liquidation to cease at any time before the Liquidity Termination
Date, subject to Section 1.2(b) below, by notifying the Agent and the Collection
Agent in writing (including by telecopy or other facsimile communication) at
least three Business Days before the date on which it desires such Interim
Liquidation to cease.
(b) Mandatory. If at any time before the Liquidity Termination Date any
condition in Section 7.2 is not fulfilled, the Seller shall immediately notify
the Agent and the Collection Agent, whereupon Reinvestment Purchases shall cease
and an Interim Liquidation shall commence, which shall only cease upon the
Seller confirming to the Agent that the conditions in Section 7.2 are fulfilled.
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Section 1.3. Selection of Discount Rates and Tranche Periods. (a)(1)
The provisions of this subsection (a)(1) shall apply to all Investment of
Amsterdam funded with commercial paper issued on or before the Agent makes the
election described in clause (a)(2) below: All such Investment shall be
allocated to one or more Tranches reflecting the Discount Rates at which such
Investment accrues Discount and the Tranche Periods for which such Discount
Rates apply. All such Investment of Amsterdam shall accrue Discount at the CP
Rate. Each CP Tranche shall be in the minimum amount of $1,000,000 and in
multiples thereof. All Discount accrued at the CP Rate during a Tranche Period
shall be payable by the Seller on the last day of such Tranche Period; (2) At
the Agent's option, the Agent may notify the Seller that the provisions of this
subsection (a)(2) shall apply to all Investment of Amsterdam funded with Pooled
Commercial Paper issued after the Agent delivers a notice to the Seller that it
elects to have the provisions of this clause (a)(2) to be applicable to the
Investment of Amsterdam: The Seller shall pay Funding Charges with respect to
Amsterdam's Purchase Interest for each day that any Investment in respect of
such Purchase Interest is outstanding. Each such Purchase Interest will accrue
Funding Charges each day based on the Pooled Allocation. On each Settlement Date
the Seller shall pay to the Agent (for the benefit of Amsterdam) an aggregate
amount equal to all accrued and unpaid Funding Charges in respect of such
Purchase Interest for the immediately preceding Discount Period; (3) All
Investment of the Committed Purchasers shall be allocated to one or more
Tranches reflecting the Discount Rates at which such Investment accrues Discount
and the Tranche Periods for which such Discount Rates apply. In each request for
an Incremental Purchase from a Committed Purchaser and three Business Days
before the expiration of any Tranche Period applicable to any Committed
Purchaser's Investment, the Seller may request the Tranche Period(s) to be
applicable to such Investment and the Discount Rate(s) applicable thereto. All
Investment of the Committed Purchasers may accrue Discount at either the
Eurodollar Rate or the Prime Rate, in all cases as established for each Tranche
Period applicable to such Investment. Each Tranche shall be in the minimum
amount of $1,000,000 and in multiples thereof or, in the case of Discount
accruing at the Prime Rate, in any amount of Investment that otherwise has not
been allocated to another Tranche Period. Any Investment of the Committed
Purchasers not allocated to a Tranche Period shall be a Prime Tranche. During
the pendency of a Termination Event, the Agent may reallocate any outstanding
Investment of the Committed Purchasers to a Prime Tranche. All Discount accrued
on the Investment of the Committed Purchasers during a Tranche Period shall be
payable by the Seller on the last day of such Tranche Period or, for a
Eurodollar Tranche with a Tranche Period of more than three months, 90 days
after the commencement, and on the last day, of such Tranche Period.
(b) The Agent shall allocate the Investment of Amsterdam to Tranche
Periods in its sole discretion. If, by the time required in Section 1.3(a), the
Seller fails to select a Discount Rate or Tranche Period for any Investment of
the Committed Purchasers, such amount of Investment shall automatically accrue
Discount at the Prime Rate for a three Business Day Tranche Period. Any
Investment purchased from Amsterdam pursuant to the Transfer Agreement shall
accrue Discount at the Prime Rate and have an initial Tranche Period of three
Business Days.
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(c) If the Agent or any Committed Purchaser determines (i) that
maintenance of any Eurodollar Tranche would violate any applicable law or
regulation, (ii) that deposits of a type and maturity appropriate to match fund
any of such Purchaser's Eurodollar Tranches are not available or (iii) that the
maintenance of any Eurodollar Tranche will not adequately and fairly reflect the
cost of such Purchaser of funding Eurodollar Tranches, then the Agent, upon the
direction of such Purchaser, shall suspend the availability of, and terminate
any outstanding, Eurodollar Tranche so affected. All Investment allocated to any
such terminated Eurodollar Tranche shall be reallocated to a Prime Rate Tranche.
Section 1.4. Fees and Other Costs and Expenses. (a) The Seller shall
pay to the Agent for the ratable benefit of the Liquidity Providers, such
amounts as agreed to with the Liquidity Providers and the Agent in the Fee
Letter.
(b) If the amount of Investment allocated to any CP or Eurodollar
Tranche is reduced before the last day of its Tranche Period, or if a requested
Incremental Purchase at the Eurodollar Rate does not take place on its scheduled
Purchase Date, the Seller shall pay the Early Payment Fee to each Purchaser that
had its Investment so reduced or scheduled Purchase not made.
(c) Investment shall be payable solely from Collections and from
amounts payable under Sections 1.5, 1.7 and 6.1 (to the extent amounts paid
under Section 6.1 indemnify against reductions in or non-payment of
Receivables). The Seller shall pay, as a full recourse obligation, all other
amounts payable hereunder, including, without limitation, all Discount, fees
described in clauses (a) and (b) above and amounts payable under Article VI.
Section 1.5. Maintenance of Sold Interest; Deemed Collection. (a)
General. If at any time before the Liquidity Termination Date the Eligible
Receivables Balance is less than the sum of the Aggregate Investment (or, if a
Termination Event exists, the Matured Aggregate Investment) plus the Aggregate
Reserve, the Seller shall pay to the Agent an amount equal to such deficiency
for application to reduce the Investments of the Purchasers ratably in
accordance with the principal amount of their respective Investments, applied
first to Prime Tranches and second to the other Tranches with the shortest
remaining maturities unless otherwise specified by the Seller. Any amount so
applied to reduce Amsterdam's Investment shall be deposited in the Special
Transaction Subaccount.
(b) Deemed Collections. If on any day the outstanding balance of a
Receivable is reduced or cancelled as a result of any defective or rejected
goods or services, any cash discount or adjustment (including any adjustment
resulting from the application of any special refund or other discounts or any
reconciliation), any setoff or credit (whether such claim or credit arises out
of the same, a related, or an unrelated transaction) or other similar reason not
arising from the financial inability of the Obligor to pay undisputed
indebtedness, the Seller shall be deemed to have received on such day a
Collection on such Receivable in the amount of such reduction or cancellation.
If on any day any representation, warranty, covenant or other agreement of the
Seller related to a Receivable is not true or is not satisfied, the Seller shall
be deemed to have received on such day a Collection in the amount of the
outstanding balance of such Receivable. All such Collections deemed received by
the Seller under this Section 1.5(b) shall be remitted by the Seller to the
Collection Agent in accordance with Section 5.1(i).
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(c) Adjustment to Sold Interest. At any time before the Liquidity
Termination Date that the Seller is deemed to have received any Collection under
Section 1.5(b) ("Deemed Collections") that derive from a Receivable that is
otherwise reported as an Eligible Receivable, so long as no Liquidation Period
then exists, the Seller may satisfy its obligation to deliver such amount to the
Collection Agent by instead notifying the Agent that the Sold Interest should be
recalculated by decreasing the Eligible Receivables Balance by the amount of
such Deemed Collections, so long as such adjustment does not cause the Sold
Interest to exceed 100.0%.
(d) Payment Assumption. Unless an Obligor otherwise specifies or
another application is required by contract or law, any payment received by the
Seller from any Obligor shall be applied as a Collection of Receivables of such
Obligor (starting with the oldest such Receivable) and remitted to the
Collection Agent as such.
Section 1.6. Reduction in Commitments. The Seller may, upon thirty
days' notice to the Agent, reduce the Aggregate Commitment in increments of
$1,000,000, so long as the Aggregate Commitment at all times equals at least the
outstanding Matured Aggregate Investment. Each such reduction in the Aggregate
Commitment shall reduce the Commitment of each Committed Purchaser in accordance
with its Ratable Share and shall ratably reduce the Purchase Limit so that the
Aggregate Commitment remains at least 102% of the Purchase Limit.
Section 1.7. Repurchases. (a) Optional. At any time that the Aggregate
Investment is less than 10% of the Aggregate Commitment in effect on the date
hereof, the Seller may, upon thirty days' notice to the Agent, repurchase the
entire Sold Interest from the Purchasers at a price equal to the outstanding
Matured Aggregate Investment and all other amounts then owed hereunder.
(b) Mandatory. If at any time before the Liquidity Termination Date the
Sold Interest exceeds 100.0%, unless the Seller remedies the situation by
satisfying its obligations under Section 1.5(a), any Purchaser may direct that
all Purchasers ratably reassign to the Seller, without recourse, representation
or warranty, a portion of the Purchase Interest of each Purchaser so that the
Sold Interest does not exceed 100.0%. The Seller shall purchase such reassigned
Purchase Interests at a purchase price equal to the Matured Value of the
Investment so reassigned by each Purchaser.
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Section 1.8. Assignment of Purchase Agreements. The Seller hereby
assigns and otherwise transfers to the Agent (for the benefit of the Agent, each
Purchaser and any other Person to whom any amount is owed hereunder), all of the
Seller's right, title and interest in, to and under each Purchase Agreement. The
Seller shall execute, file and record all financing statements, continuation
statements and other documents required to perfect or protect such assignment.
This assignment includes (a) all monies due and to become due to the Seller from
each Originator or the Parent under or in connection with each Purchase
Agreement (including fees, expenses, costs, indemnities and damages for the
breach of any obligation or representation related to such agreement) and (b)
all rights, remedies, powers, privileges and claims of the Seller against each
Originator or the Parent under or in connection with each Purchase Agreement.
All provisions of each Purchase Agreement shall inure to the benefit of, and may
be relied upon by, the Agent, each Purchaser and each such other Person. At any
time that a Termination Event has occurred and is continuing, the Agent shall
have the sole right to enforce the Seller's rights and remedies under each
Purchase Agreement to the same extent as the Seller could absent this
assignment, but without any obligation on the part of the Agent, any Purchaser
or any other such Person to perform any of the obligations of the Seller under
each Purchase Agreement (or any of the promissory notes executed thereunder).
All amounts distributed to the Seller under each Purchase Agreement from
Receivables sold to the Seller thereunder shall constitute Collections hereunder
and shall be applied in accordance herewith.
Section 1.9. Extension of Liquidity Termination Date. The Seller may
advise the Liquidity Providers in writing of its desire to extend the Liquidity
Termination Date for an additional period, provided (i) such request is made not
more than 120 days prior to, and not less than 90 days prior to, the then
current Liquidity Termination Date, and (ii) not more than one such request for
the extension of the Liquidity Termination Date may be made in any one calendar
year. In the event that the Liquidity Providers are agreeable to such extension,
the Agent shall so notify the Seller in writing (it being understood that the
Liquidity Providers may accept or decline such a request in their sole
discretion and on such terms as they may elect) not less than 45 days prior to
the Liquidity Termination Date and the Seller and the Liquidity Providers shall
enter into such documents as the Liquidity Providers may deem necessary or
appropriate to reflect such extension, and all reasonable costs and expenses
incurred by the Liquidity Providers in connection therewith (including
reasonable attorneys' fees) shall be paid by the Seller. The Liquidity Providers
shall be deemed to have refused to grant the requested extension in the event
the Agent shall fail to so notify the Seller of their agreement to such an
extension.
ARTICLE II
SALES TO AND FROM AMSTERDAM; ALLOCATIONS
Section 2.1. Required Purchases from Amsterdam. (a) Amsterdam may, at
any time, sell to the Committed Purchasers pursuant to the Transfer Agreement
any percentage designated by Amsterdam of Amsterdam's Investment and its related
Amsterdam Settlement (each, a "Put").
(b) Any portion of Amsterdam's Investment and related Amsterdam
Settlement purchased by a Committed Purchaser shall be considered part of such
Purchaser's Investment and related Amsterdam Settlement from the date of the
relevant Put. Immediately upon any purchase by the Committed Purchasers of any
portion of Amsterdam's Investment, the Seller shall pay to the Agent (for the
ratable benefit of such Purchasers) an amount equal to the sum of (i) the
Assigned Amsterdam Settlement and (ii) all unpaid Discount owed to Amsterdam
(whether or not then due) to the end of each applicable Tranche Period to which
any Investment being Put has been allocated, (iii) all accrued but unpaid fees
(whether or not then due) payable to Amsterdam in connection herewith at the
time of such purchase and (iv) all accrued and unpaid costs, expenses and
indemnities due to Amsterdam from the Seller in connection herewith.
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(c) The proceeds from each Put received by Amsterdam (other than
amounts described in clauses (iii) and (iv) of the last sentence of Section
2.1(b)), shall be transferred into the Special Transaction Subaccount and used
solely to pay that portion of the outstanding commercial paper of Amsterdam
issued to fund or maintain the Investment of Amsterdam so transferred. Until
used to pay CP Notes, all proceeds of any Put pursuant to this Section shall be
invested in Permitted Investments. All earnings on such Permitted Investments
shall be promptly remitted to the Seller.
Section 2.2. Purchases by Amsterdam. Amsterdam may at any time deliver
to the Agent and each Committed Purchaser a notification of assignment in
substantially the form of Exhibit B. If Amsterdam delivers such notice, each
Committed Purchaser shall sell to Amsterdam and Amsterdam shall purchase in full
from each Committed Purchaser, the Investment of the Committed Purchasers on the
last day of the relevant Tranche Periods, at a purchase price equal to such
Investment plus accrued and unpaid Discount thereon. Any sale from any Committed
Purchaser to Amsterdam pursuant to this Section 2.2 shall be without recourse,
representation or warranty except for the representation and warranty that the
Investment sold by such Committed Purchaser is free and clear of any Adverse
Claim created or granted by such Committed Purchaser and that such Purchaser has
not suffered a Bankruptcy Event.
Section 2.3. Allocations and Distributions.
(a) Settlement Dates. On the Business Day following each
Deposit Date occurring prior to the Liquidity Termination Date (unless an
Interim Liquidation is in effect), the Collection Agent shall set aside from
Collections the amounts necessary to make all distributions to the Agent, the
Purchasers and the Collection Agent required by this Section 2.3(a) with respect
to the next succeeding Settlement Date. The balance of such Collections shall be
released to the Seller on a daily basis. On each Settlement Date prior to the
Liquidity Termination Date (unless an Interim Liquidation is in effect), all
Collections so set aside during the preceding Settlement Period shall be applied
where applicable by the Collection Agent (or, if the Agent is then in control of
any Collections, by the Agent) in the following order:
(i) all fees and other amounts due and payable to the Agent;
(ii) ratably to the Purchasers, all Funding Charges and
Discount due and payable on such date;
(iii) ratably to the Purchasers, all other amounts due and
payable to the Purchasers under the Transaction Documents;
(iv) to the Collection Agent and the Exchange Agent, an amount
equal to the Collection Agent Fee due and payable on such date; and
(v) to the Seller.
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On the last day of each Tranche Period for a Eurodollar Tranche or Prime
Tranche, the Collection Agent (or, if the Agent is then in control of any
Collections, the Agent) shall pay Discount due and payable to such Committed
Purchasers from accounts set aside for such purpose pursuant to Section 3.2(a).
If any part of the Sold Interest in any Collections is applied to pay
any amounts that are recourse obligations of the Seller pursuant to Section
1.4(c) and after giving effect to such application the Sold Interest is greater
than 100.0%, the Seller shall pay, as a recourse obligation for distribution as
part of the Sold Interest in Collections, to the Collection Agent the amount so
applied to the extent necessary so that after giving effect to such payment the
Sold Interest is no greater than 100.0%.
(b) Liquidity Termination Date and Interim Liquidations. On each day
during any Interim Liquidation and on each day on and after the Liquidity
Termination Date, the Collection Agent shall set aside and hold in trust solely
for the account of the Agent, for the benefit of the Agent and the Purchasers,
(or deliver to the Agent, if so instructed pursuant to Section 3.2(a)) the Sold
Interest in all Collections received on such day and such Collections shall be
allocated as follows:
(i) first, to the Agent until all amounts owed to the Agent
have been paid in full;
(ii) second, to the Purchasers until all amounts owed to the
Purchasers have been paid in full;
(iii) third, to any other Person (other than the Seller, the
Collection Agent, the Exchange Agent or an Originator) to whom any
amounts are owed under the Transaction Documents until all such amounts
have been paid in full; and
(iv) fourth, to the Collection Agent until all amounts owed to
the Collection Agent and the Exchange Agent under the Agreement have
been paid in full; and
(v) fifth, to the Seller.
On the last day of each Tranche Period (unless otherwise instructed by the Agent
pursuant to Section 3.2(a)), the Collection Agent shall deposit into the Agent's
Account, from such set aside Collections, all amounts allocated to such Tranche
Period and all Tranche Periods that ended before such date that are due in
accordance with clause (ii) above. No distributions shall be made to pay amounts
under clauses (iii) - (v) until sufficient Collections have been set aside to
pay all amounts described in clauses (i) and (ii) that may become payable for
all outstanding Tranche Periods. All distributions by the Agent shall be made
ratably within each priority level in accordance with the respective amounts
then due each Person included in such level unless otherwise agreed by the Agent
and all Purchasers. If any part of the Sold Interest in any Collections is
applied to pay any amounts payable hereunder that are recourse obligations of
the Seller pursuant to Section 1.4(c) and after giving effect to such
application the Sold Interest is greater than 100.0%, the Seller shall pay, as a
recourse obligation for distribution in respect of each applicable Purchaser's
Investment as part of the Sold Interest in Collections, to the Collection Agent
the amount so applied to the extent necessary so that after giving effect to
such payment the Sold Interest is no greater than 100.0%.
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ARTICLE III
ADMINISTRATION AND COLLECTIONS
Section 3.1. Appointment of Collection Agent. (a) The servicing,
administering and collecting of the Receivables shall be conducted by a Person
(the "Collection Agent") designated to so act on behalf of the Purchasers under
this Article III. As the Initial Collection Agent, the Parent is hereby
designated as, and agrees to perform the duties and obligations of, the
Collection Agent. The Parent acknowledges that the Agent and each Purchaser have
relied on the Parent's agreement to act as Collection Agent (and the agreement
of any of the sub-collection agents to so act) in making the decision to execute
and deliver this Agreement and agrees that it will not voluntarily resign as
Collection Agent. At any time after the occurrence of a Collection Agent
Replacement Event, the Agent may designate a new Collection Agent to succeed the
Parent (or any successor Collection Agent).
(b) The Parent may, and if requested by the Agent shall, delegate its
duties and obligations as Collection Agent to an Affiliate (acting as a
sub-collection agent). Notwithstanding such delegation, the Parent shall remain
primarily liable for the performance of the duties and obligations so delegated,
and the Agent and each Purchaser shall have the right to look solely to the
Parent for such performance. The Agent may at any time after the occurrence of a
Collection Agent Replacement Event remove or replace any sub-collection agent.
(c) If replaced, the Collection Agent agrees it will terminate, and
will cause each existing sub-collection agent to terminate, its collection
activities in a manner requested by the Agent to facilitate the transition to a
new Collection Agent. The Collection Agent shall cooperate with and assist any
new Collection Agent (including providing access to, and transferring, all
Records and allowing the new Collection Agent to use all licenses, hardware or
software necessary or desirable to collect the Receivables). The Parent
irrevocably agrees to act (if requested to do so) as the data-processing agent
for any new Collection Agent in substantially the same manner as the Parent
conducted such data-processing functions while it acted as the Collection Agent;
provided, however, that the Parent receives a then market rate compensation for
providing such services.
Section 3.2. Duties of Collection Agent. (a) The Collection Agent shall
take, or cause to be taken, all action necessary or advisable to collect each
Receivable in accordance with this Agreement, the Credit and Collection Policy
and all applicable laws, rules and regulations using the skill and attention the
Collection Agent exercises in collecting other receivables or obligations owed
solely to it. The Collection Agent shall, in accordance herewith, set aside all
Collections to which a Purchaser is entitled. If so instructed by the Agent, the
Collection Agent shall transfer to the Agent the amount of Collections to which
the Agent and the Purchasers are entitled by the Business Day following receipt
and identification thereof. Each party hereto hereby appoints the Collection
Agent to enforce such Person's rights and interests in the Receivables, but
(notwithstanding any other provision in any Transaction Document) the Agent
shall at all times after the occurrence of a Collection Agent Replacement Event
have the sole right to direct the Collection Agent to commence or settle any
legal action to enforce collection of any Receivable.
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(b) If no Termination Event exists and the Collection Agent determines
that such action is appropriate in order to maximize the Collections, the
Collection Agent may, in accordance with the Credit and Collection Policy,
extend the maturity of any Receivable (but no such extension shall be for a
period more than thirty (30) days) or adjust the outstanding balance of any
Receivable. Any such extension or adjustment shall not alter the status of a
Receivable as a Defaulted Receivable or Delinquent Receivable or limit any
rights of the Agent or the Purchasers hereunder. If a Termination Event exists,
the Collection Agent may make such extensions or adjustments only with the prior
consent of the Instructing Group.
(c) The Collection Agent shall turn over to the Seller (i) any
percentage of Collections in excess of the Sold Interest, less all reasonable
third party out-of-pocket costs and expenses of the Collection Agent for
collecting the Receivables and (ii) subject to Section 1.5(d), the collections
and records for any indebtedness owed to the Seller that is not a Receivable.
The Collection Agent shall have no obligation to remit any such funds or records
to the Seller until the Collection Agent receives evidence (satisfactory to the
Agent) that the Seller is entitled to such items. The Collection Agent has no
obligations concerning indebtedness that is not a Receivable other than to
deliver the collections and records for such indebtedness to the Seller when
required by this Section 3.2(c).
Section 3.3. Reports. On or before each Reporting Date, the Collection
Agent shall deliver to the Agent a Periodic Report reflecting information as of
the close of business of the Collection Agent for the immediately preceding
Reporting Period.
Section 3.4. Lock-Box Arrangements. The Agent is hereby authorized to
give notice at any time after the occurrence of a Collection Agent Replacement
Event to any or all Lock-Box Banks that the Agent is exercising its rights under
the Lock-Box Letters and to take all actions permitted under the Lock-Box
Letters. The Seller agrees to take any action requested by the Agent to
facilitate the foregoing. After the Agent takes any such action under the
Lock-Box Letters, the Seller shall immediately deliver to the Agent any
Collections received by the Seller. If the Agent takes control of any Lock-Box
Account, the Agent shall distribute Collections it receives in accordance
herewith and shall deliver to the Collection Agent, for distribution under
Section 3.2, all other amounts it receives from such Lock-Box Account.
Section 3.5. Enforcement Rights. (a) The Agent may, at any time after
the occurrence of a Collection Agent Replacement Event, direct the Obligors and
the Lock-Box Banks to make all payments on the Receivables directly to the Agent
or its designee. The Agent may, and the Seller shall at the Agent's request,
withhold the identity of the Purchasers from the Obligors and Lock-Box Banks.
Upon the Agent's request after the occurrence of a Collection Agent Replacement
Event, the Seller (at the Seller's expense) shall (i) give notice to each
Obligor of the Agent's ownership of the Sold Interest and direct that payments
on Receivables be made directly to the Agent or its designee, (ii) assemble for
the Agent all Records and collateral security for the Receivables and transfer
to the Agent (or its designee), or license to the Agent (or its designee) the
use of, all software then used by the Collection Agent to collect the
Receivables and (iii) segregate in a manner acceptable to the Agent all
Collections the Seller receives and, promptly upon receipt, remit such
Collections in the form received, duly endorsed or with duly executed
instruments of transfer, to the Agent or its designee.
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(b) After the occurrence of a Collection Agent Replacement Event,
Seller hereby irrevocably appoints the Agent as its attorney-in-fact coupled
with an interest, with full power of substitution and with full authority in the
place of the Seller, to take any and all steps deemed desirable by the Agent, in
the name and on behalf of the Seller to (i) collect any amounts due under any
Receivable, including endorsing the name of the Seller on checks and other
instruments representing Collections and enforcing such Receivables, and (ii)
exercise any and all of the Seller's rights and remedies under each Purchase
Agreement. The Agent's powers under this Section 3.5(b) shall not subject the
Agent to any liability if any action taken by it (except for any action taken
pursuant thereto that constitutes gross negligence or willful misconduct) proves
to be inadequate or invalid, nor shall such powers confer any obligation
whatsoever upon the Agent.
(c) Neither the Agent nor any Purchaser shall have any obligation to
take or consent to any action to realize upon any Receivable or to enforce any
rights or remedies related thereto.
Section 3.6. Collection Agent Fee. On or before the twentieth day of
each calendar month, the Seller shall pay to the Collection Agent a fee for the
immediately preceding calendar month as compensation for its services as
Collection Agent and Exchange Agent (the "Collection Agent Fee") equal to (a) at
all times the Parent or an Affiliate of any Crompton Entity is the Collection
Agent, such consideration as is acceptable to it, the receipt and sufficiency of
which is hereby acknowledged, and (b) at all times any other Person is the
Collection Agent, a reasonable amount agreed upon by the Agent and the new
Collection Agent on an arm's-length basis reflecting rates and terms prevailing
in the market at such time. The Collection Agent may only apply to payment of
the Collection Agent Fee the portion of the Collections in excess of the Sold
Interest or Collections that fund Reinvestment Purchases. The Agent may, with
the consent of the Instructing Group, pay the Collection Agent Fee to the
Collection Agent from the Sold Interest in Collections. The Seller shall be
obligated to reimburse any such payment to the extent required by Section 1.5 or
2.3.
Section 3.7. Responsibilities of the Seller. The Seller shall, or shall
cause each Originator to, pay when due all Taxes payable in connection with the
Receivables or their creation or satisfaction. The Seller shall, and shall cause
each Originator to, perform all of its obligations under agreements related to
the Receivables to the same extent as if interests in the Receivables had not
been transferred hereunder or, in the case of each Originator, under each
Purchase Agreement. The Agent's or any Purchaser's exercise of any rights
hereunder shall not relieve the Seller or any Originator from such obligations.
Neither the Agent nor any Purchaser shall have any obligation to perform any
obligation of the Seller or of any Originator or any other obligation or
liability in connection with the Receivables.
Section 3.8. Actions by Seller. The Seller shall defend and indemnify
the Agent and each Purchaser against all costs, expenses, claims and liabilities
for any action taken by the Seller, any Originator or any other Affiliate of the
Seller or of such Originator (whether acting as Collection Agent or otherwise)
related to any Receivable (other than with respect to the credit risk of an
Obligor and for which reimbursement would constitute recourse for uncollectible
Receivables), or arising out of any alleged failure of compliance of any
Receivable with the provisions of any law or regulation. If any goods related to
a Receivable are repossessed, the Seller agrees to resell, or to have the
applicable Originator or another Affiliate resell, such goods in a commercially
reasonable manner for the account of the Agent and remit, or have remitted, to
the Agent the Purchasers' share in the gross sale proceeds thereof net of any
out-of-pocket expenses and any equity of redemption of the Obligor thereon. Any
such moneys collected by the Seller or the applicable Originator or other
Affiliate of the Seller pursuant to this Section 3.8 shall be segregated and
held in trust for the Agent and remitted to the Agent's Account within two
Business Days of receipt as part of the Sold Interest in Collections for
application as provided herein.
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Section 3.9. Indemnities by the Collection Agent. Without limiting any
other rights any Person may have hereunder or under applicable law, the
Collection Agent hereby indemnifies and holds harmless the Agent and each
Purchaser and their respective officers, directors, agents and employees (each
an "Indemnified Party") from and against any and all damages, losses, claims,
liabilities, penalties, Taxes, costs and expenses (including attorneys' fees and
court costs) (all of the foregoing collectively, the "Indemnified Losses") at
any time imposed on or incurred by any Indemnified Party arising out of or
otherwise relating to:
(i) any written representation or warranty made by the
Collection Agent (or any employee or agent of the Collection Agent) in
this Agreement, any other Transaction Document, any Periodic Report or
any other information or report delivered by the Collection Agent
pursuant hereto, which shall have been false or incorrect in any
material respect when made;
(ii) the failure by the Collection Agent to comply with any
applicable law, rule or regulation related to any Receivable, or the
nonconformity of any Receivable with any such applicable law, rule or
regulation;
(iii) any loss of a perfected security interest (or in the
priority of such security interest) as a result of any commingling by
the Collection Agent of funds to which the Agent or any Purchaser is
entitled hereunder with any other funds; or
(iv) any failure of the Collection Agent, to perform its
duties or obligations in accordance with the provisions of this
Agreement or any other Transaction Document to which the Collection
Agent is a party;
whether arising by reason of the acts to be performed by the Collection Agent
hereunder or otherwise, excluding only Indemnified Losses to the extent (a) such
Indemnified Losses resulted solely from negligence or willful misconduct of the
Indemnified Party seeking indemnification, (b) solely due to the credit risk of
the Obligor and for which reimbursement would constitute recourse to the
Collection Agent for uncollectible Receivables, (c) such Indemnified Losses
include Taxes on, or measured by, the overall net income of the Agent or any
Purchaser computed in accordance with the Intended Tax Characterization, or (d)
the applicable Originator is the plaintiff and the Indemnified Party is the
defendant unless such Indemnified Party prevails in such legal action; provided,
however, that nothing contained in this sentence shall limit the liability of
the Collection Agent or limit the recourse of the Agent and each Purchaser to
the Collection Agent for any amounts otherwise specifically provided to be paid
by the Collection Agent hereunder.
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Section 3.10. Exchange Agent; Currency Conversion. (a) Currency
conversion of Receivables denominated in currencies other than Dollars shall be
conducted by a Person (the "Exchange Agent") designated to so act hereunder.
Crompton Corporation is hereby designated as, and agrees to perform the duties
and obligations of, the Exchange Agent. The Exchange Agent acknowledges that the
Agent and each Purchaser have relied on the Exchange Agent's agreement to act as
Exchange Agent in making the decision to execute and deliver this Agreement and
agrees that it will not voluntarily resign as Exchange Agent unless required by
applicable law. At any time after a breach by the Exchange Agent of its
obligations hereunder or, with respect to the occurrence of a Collection Agent
Replacement Event, the Agent may designate a new Exchange Agent to succeed
Crompton Corporation (or any successor Exchange Agent).
(b) The Collection Agent shall remit to the Exchange Agent all
Collections on Receivables that are not denominated in Dollars on the date
received in the currency in which such Collection is received. In exchange
therefor, the Exchange Agent shall remit to the Collection Agent the amount of
such non-Dollar denominated Collections in Dollars converted at the applicable
Exchange Rate. Each Exchange Rate notified by the Collection Agent to the Agent
in a Collection Report will be determined by the Collection Agent in good faith
upon consultation with the Exchange Agent.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties. The Seller represents and
warrants to the Agent and each Purchaser that:
(a) Corporate Existence and Power. Each of the Seller and
each Crompton Entity is either a corporation or limited liability
company duly organized, validly existing and in good standing under the
laws of its state of organization and has all corporate or
organizational power and authority and all governmental licenses,
authorizations, consents and approvals required to carry on its
business in each jurisdiction in which its business is now conducted,
except where failure to obtain such license, authorization, consent or
approval would not have a material adverse effect on (i) its ability to
perform its obligations under, or the enforceability of, any
Transaction Document, (ii) its business or financial condition, (iii)
the interests of the Agent or any Purchaser under any Transaction
Document or (iv) the enforceability or collectibility of any
Receivable.
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(b) Corporate or Organizational Authorization and No
Contravention. The execution, delivery and performance by each of the
Seller and each Crompton Entity of each Transaction Document to which
it is a party (i) are within its corporate or organizational powers, as
applicable, (ii) have been duly authorized by all necessary corporate
or organizational action, as applicable, (iii) do not contravene or
constitute a default under (A) any applicable law, rule or regulation,
(B) its or any Subsidiary's charter, by-laws or operating agreement, as
applicable or (C) any agreement, order or other instrument to which it
or any Subsidiary is a party or its property is subject and (iv) will
not result in any Adverse Claim on any Receivable or Collection or give
cause for the acceleration of any indebtedness of the Seller, any
Crompton Entity or any Subsidiary.
(c) Conduct of Business. The Seller will perform, and will
cause each Crompton Entity to perform, all actions necessary to remain
duly organized, validly existing and in good standing in its
jurisdiction of organization and to maintain all requisite authority to
conduct its business in each jurisdiction in which it conducts
business.
(d) Binding Effect. Each Transaction Document to which the
Seller or any Crompton Entity is a party constitutes the legal, valid
and binding obligation of such Person enforceable against that Person
in accordance with its terms, except as limited by bankruptcy,
insolvency, or other similar laws of general application relating to or
affecting the enforcement of creditors' rights generally and subject to
general principles of equity.
(e) Perfection of Ownership Interest. Immediately preceding
its sale of Receivables to the Seller, each Originator was the owner
of, and effectively sold, such Receivables to the Seller, free and
clear of any Adverse Claim. The Seller owns the Receivables free of any
Adverse Claim other than the interests of the Purchasers (through the
Agent) therein that are created hereby, and each Purchaser shall at all
times have a valid undivided percentage ownership interest, which shall
be a first priority perfected security interest for purposes of Article
9 of the applicable Uniform Commercial Code, in the Receivables and
Collections (subject to, in the case of Collections, the limitations on
perfection of a security interest in proceeds set forth in the
applicable Uniform Commercial Code) to the extent of its Purchase
Interest then in effect.
(f) Accuracy of Information. All information furnished by the
Seller, any Crompton Entity or any Affiliate of any such Person to the
Agent or any Purchaser in connection with any Transaction Document, or
any transaction contemplated thereby, is true and accurate in all
material respects (and is not incomplete by omitting any information
necessary to prevent such information from being materially
misleading), in each case on the date the statement was made and in
light of the circumstances under which the statements were made or the
information was furnished.
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(g) No Actions, Suits. There are no actions, suits or other
proceedings (including matters relating to environmental liability)
pending or threatened against or affecting the Seller, any Crompton
Entity or any Subsidiary, or any of their respective properties, that
(i) if adversely determined (individually or in the aggregate), may
have a material adverse effect on the financial condition of the
Seller, any Crompton Entity or any Subsidiary or on the collectibility
of the Receivables or (ii) involve any Transaction Document or any
transaction contemplated thereby. None of the Seller, any Crompton
Entity or any Subsidiary is in default of any contractual obligation or
in violation of any order, rule or regulation of any Governmental
Authority, which default or violation may have a material adverse
effect upon (i) the financial condition of the Seller, the Crompton
Entities and the Subsidiaries taken as a whole or (ii) the
collectibility of the Receivables.
(h) No Material Adverse Change. Since December 31, 1997,
there has been no material adverse change in the collectibility of the
Receivables or the Seller's, any Crompton Entity's or any Subsidiary's
(i) financial condition or (ii) ability to perform its obligations
under any Transaction Document.
(i) Accuracy of Exhibits; Lock-Box Arrangements. All
information on Exhibits E-G (listing offices and names of the Seller
and each Originator and where they maintain Records; the Subsidiaries;
and Lock Boxes) is true and complete, subject to any changes permitted
by, and notified to the Agent in accordance with, Article V. The Seller
has delivered a copy of all Lock-Box Agreements to the Agent. The
Seller has not granted any interest in any Lock-Box or Lock-Box Account
to any Person other than the Agent and, upon delivery to a Lock-Box
Bank of the related Lock-Box Letter, the Agent will have exclusive
ownership and control of the Lock-Box Account at such Lock-Box Bank.
(j) Sales by each Originator. Each sale by each Originator to
the Seller of an interest in Receivables and their Collections has been
made in accordance with the terms of the applicable Purchase Agreement,
including the payment by the Seller to each Originator of the purchase
price described in such Purchase Agreement. Each such sale has been
made for "reasonably equivalent value" (as such term is used in Section
548 of the Bankruptcy Code) and not for or on account of "antecedent
debt" (as such term is used in Section 547 of the Bankruptcy Code) owed
by such Originator to the Seller.
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Seller. The Seller hereby covenants and
agrees to comply with the following covenants and agreements, unless the Agent
(with the consent of the Instructing Group) shall otherwise consent:
(a) Financial Reporting. The Seller will, and will cause each Crompton
Entity and each Subsidiary to, maintain a system of accounting established and
administered in accordance with GAAP and will furnish to the Agent and each
Purchaser:
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(i) Annual Financial Statements. Within 120 days after each
fiscal year of (A) the Parent copies of the Parent's consolidated
annual audited financial statements (including a consolidated balance
sheet, consolidated statement of income and retained earnings and
statement of cash flows, with related footnotes) certified by
independent certified public accountants of nationally recognized
standing or other firm of independent certified public accountants
satisfactory to the Agent and prepared on a consolidated basis in
conformity with GAAP, and (B) for each of the Seller and each
Originator the annual balance sheet for such Person (and, additionally
for the Seller, an annual profit and loss statement) certified by a
Designated Financial Officer thereof, in each case prepared on a
consolidated basis in conformity with GAAP as of the close of such
fiscal year for the year then ended;
(ii) Quarterly Financial Statements. Within 60 days after each
(except the last) fiscal quarter of each fiscal year of (A) the Parent,
copies of its unaudited financial statements (including at least a
consolidated balance sheet as of the close of such quarter and
statements of earnings and sources and applications of funds for the
period from the beginning of the fiscal year to the close of such
quarter) certified by a Designated Financial Officer and prepared in a
manner consistent with the financial statements described in part (A)
of clause (i) of this Section 5.l(a) and (B) each of the Seller and
each Originator, the quarterly balance sheet for such Person (and,
additionally for the Seller, a profit and loss statement) for the
period from the beginning of such fiscal year to the close of such
quarter, in each case certified by a Designated Financial Officer
thereof and prepared in a manner consistent with part (B) of clause (i)
of Section 5.1(a);
(iii) Officer's Certificate. Each time financial statements are
furnished pursuant to clause (i) or (ii) of Section 5.1(a), a
compliance certificate (in substantially the form of Exhibit H) signed
by a Designated Financial Officer, dated the date of such financial
statements;
(iv) Public Reports. Promptly upon becoming available, a copy
of each report or proxy statement filed by the Parent with the
Securities Exchange Commission or any securities exchange;
(v) Crompton Credit Agreement Certificate. A copy of the
financial information, certificates and other documentation described
in Sections 5.01(a) through (h) of the Crompton Credit Agreement,
delivered as and when required by such Section 5.01; and
(vi) Other Information. With reasonable promptness, such other
information (including non-financial information) as may be requested
by the Agent or any Purchaser (with a copy of such request to the
Agent).
(b) Notices. Immediately upon becoming aware of any of the following
the Seller will notify the Agent and provide a description of:
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(i) Potential Termination Events. The occurrence of any
Potential Termination Event;
(ii) Representations and Warranties. The failure of any
representation or warranty herein to be true (when made or at any time
thereafter) in any material respect;
(iii) Downgrading. The downgrading, withdrawal or suspension of
any rating by any rating agency of any indebtedness of the Seller;
(iv) Litigation. The institution of any litigation,
arbitration proceeding or governmental proceeding reasonably likely to
be material to the Seller, any Subsidiary or the collectibility or
quality of the Receivables;
(v) Judgments. The entry of any judgment or decree against
the Seller, any Crompton Entity or any Subsidiary if the aggregate
amount of all judgments then outstanding against the Seller, the
Crompton Entities and the Subsidiaries exceeds $1,000,000; or
(vi) Changes in Business. Any change in, or proposed change
in, the character of the Seller's or any Originator's business that
could impair the collectibility or quality of any Receivable.
If the Agent receives such a notice, the Agent shall promptly give notice
thereof to each Purchaser and, until Amsterdam has no Investment after the
Amsterdam Termination Date, to each CP Dealer and each Rating Agency.
(c) Conduct of Business. The Seller will perform, and will cause each
Crompton Entity and Subsidiary to perform, all actions necessary to remain duly
incorporated, validly existing and in good standing in its jurisdiction of
incorporation and to maintain all requisite authority to conduct its business in
each jurisdiction in which it conducts business.
(d) Compliance with Laws. The Seller will comply, and will cause each
Crompton Entity and Subsidiary to comply, with all laws, regulations, judgments
and other directions or orders imposed by any Governmental Authority to which
such Person or any Receivable or Collection may be subject.
(e) Furnishing Information and Inspection of Records. The Seller will
furnish to the Agent and the Purchasers such information concerning the
Receivables as the Agent or a Purchaser may reasonably request. The Seller will,
and will cause each Originator to, permit, at any time during regular business
hours, the Agent or any Purchaser (or any representatives thereof), once per
year or at any time after the occurrence of a Termination Event (at the expense
of the Seller) or at any other time (at the expense of the Agent or such
Purchaser (as applicable)) (i) to examine and make copies of all Records, (ii)
to visit the offices and properties of the Seller for the purpose of examining
the Records and (iii) to discuss matters relating hereto with any of the
Seller's or any Originator's officers, directors, employees or independent
public accountants having knowledge of such matters. Once a year, the Agent may
(at the expense of the Seller provided such expenses are reasonable in amount)
have an independent public accounting firm conduct an audit of the Records or
make test verifications of the Receivables and Collections.
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(f) Keeping Records. (i) The Seller will, and will cause each
Originator to, have and maintain (A) administrative and operating procedures
(including an ability to recreate Records if originals are destroyed), (B)
adequate facilities, personnel and equipment and (C) all Records and other
information necessary or advisable for collecting the Receivables (including
Records adequate to permit the immediate identification of each new Receivable
and all Collections of, and adjustments to, each existing Receivable). The
Seller will give the Agent prior notice of any material change in such
administrative and operating procedures.
(ii) The Seller will, (A) at all times from and after the date
hereof, clearly and conspicuously xxxx its computer and master data
processing books and records with a legend describing the Agent's and
the Purchasers' interest therein and (B) upon the request of the Agent,
so xxxx each contract relating to a Receivable and deliver to the Agent
all such contracts (including all multiple originals of such
contracts), with any appropriate endorsement or assignment, or
segregate (from all other receivables then owned or being serviced by
the Seller) the Receivables and all contracts relating to each
Receivable and hold in trust and safely keep such contracts so legended
in separate filing cabinets or other suitable containers at such
locations as the Agent may specify.
(g) Perfection. (i) The Seller will, and will cause each Originator to,
at its expense, promptly execute and deliver all instruments and documents and
take all action necessary or requested by the Agent (including the execution and
filing of financing or continuation statements, amendments thereto or
assignments thereof) to enable the Agent to exercise and enforce all its rights
hereunder and to vest and maintain vested in the Agent a valid, first priority
perfected security interest in the Receivables, the Collections, the Purchase
Agreements, and proceeds thereof free and clear of any Adverse Claim (and a
perfected ownership interest in the Receivables and Collections to the extent of
the Sold Interest). The Agent will be permitted to authenticate a "record" and
to sign and file any continuation statements, amendments thereto and assignments
thereof without the Seller's signature.
(ii) The Seller will, and will cause each Originator to, only
change its name, identity or corporate structure or relocate its chief
executive office or the Records following thirty (30) days advance
notice to the Agent and the delivery to the Agent of all financing
statements, instruments and other documents (including direction
letters) requested by the Agent.
(iii) The Seller and each Originator will at all times maintain
its chief executive offices within the jurisdiction of its organization
(other than in the states of Florida, Maryland and Tennessee) in which
Article 9 of the UCC is in effect. If the Seller or any Originator
moves its chief executive office to a location that imposes Taxes, fees
or other charges to perfect the Agent's and the Purchasers' interests
hereunder or the Seller's interests under the Purchase Agreements, the
Seller will pay all such amounts and any other costs and expenses
incurred in order to maintain the enforceability of the Transaction
Documents, the Sold Interest and the interests of the Agent and the
Purchasers in the Receivables and Collections.
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(h) Performance of Duties. The Seller will perform, and will cause each
Crompton Entity and Subsidiary and the Collection Agent (if an Affiliate) to
perform, its respective duties or obligations in accordance with the provisions
of each of the Transaction Documents. The Seller (at its expense) will, and will
cause each Crompton Entity to, (i) fully and timely perform in all material
respects all agreements required to be observed by it in connection with each
Receivable, (ii) comply in all material respects with the Credit and Collection
Policy, and (iii) refrain from any action that may impair the rights of the
Agent or the Purchasers in the Receivables or Collections.
(i) Payments on Receivables, Accounts. The Seller will, and will cause
each Originator to, at all times instruct all Obligors to deliver payments on
the Receivables to a Lock-Box Account. If any such payments or other Collections
are received by the Seller or any Originator, it shall hold such payments in
trust for the benefit of the Agent and the Purchasers and promptly (but in any
event within two Business Days after receipt and identification thereof) remit
such funds into a Lock-Box Account. The Seller will cause each Lock-Box Bank to
comply with the terms of each applicable Lock-Box Letter. The Seller will not
permit the funds of any Affiliate to be deposited into any Lock-Box Account. If
such funds are nevertheless deposited into any Lock-Box Account, the Seller will
promptly identify such funds for segregation. The Seller will not, and will not
permit any Collection Agent or other Person to, commingle Collections or other
funds to which the Agent or any Purchaser is entitled with any other funds. The
Seller shall only add, and shall only permit an Originator to add, a Lock-Box
Bank, Lock-Box, or Lock-Box Account to those listed on Exhibit F if the Agent
has received notice of such addition, a copy of any new Lock-Box Agreement and
an executed and acknowledged copy of a Lock-Box Letter substantially in the form
of Exhibit G (with such changes as are acceptable to the Agent) from any new
Lock-Box Bank. The Seller shall only terminate a Lock-Box Bank or Lock-Box, or
close a Lock-Box Account, upon 30 days advance notice to the Agent.
(j) Sales and Adverse Claims Relating to Receivables. Except as
otherwise provided herein, the Seller will not, and will not permit any
Originator to, (by operation of law or otherwise) dispose of or otherwise
transfer, or create or suffer to exist any Adverse Claim upon, any receivable or
any proceed thereof.
(k) Extension or Amendment of Receivables. Except as otherwise
permitted in Section 3.2(b) and then subject to Section 1.5, the Seller will
not, and will not permit each Originator to, extend, amend, rescind or cancel
any Receivable.
(l) Change in Business or Credit and Collection Policy. The Seller will
not, and will not permit any Originator to, make any material change in the
character of its business or in its Credit and Collection Policy.
(m) Accounting for Sale. Except as provided in Section 9.9, the Seller
will not, and will not permit any Crompton Entity to, account for, or otherwise
treat, the transactions contemplated by the Transaction Documents other than as
a sale of Receivables or inconsistent with the Agent's ownership interest in the
Receivables and Collections.
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(n) Foreign Currency Risk. The Seller and the Exchange Agent will take
prudent steps to manage any foreign currency risks arising in connection with
the transactions contemplated by this Agreement.
ARTICLE VI
INDEMNIFICATION
Section 6.1. Indemnities by the Seller. Without limiting any other
rights any Person may have hereunder or under applicable law, the Seller hereby
indemnifies and holds harmless, on an after-Tax basis, the Agent and each
Purchaser and their respective officers, directors, agents and employees (each
an "Indemnified Party") from and against any and all damages, losses, claims,
liabilities, penalties, Taxes, costs and expenses (including attorneys' fees and
court costs) (all of the foregoing collectively, the "Indemnified Losses") at
any time imposed on or incurred by any Indemnified Party arising out of or
otherwise relating to any Transaction Document, the transactions contemplated
thereby or the acquisition of any portion of the Sold Interest, or any action
taken or omitted by any of the Indemnified Parties (including any action taken
by the Agent as attorney-in-fact for the Seller pursuant to Section 3.5(b)),
whether arising by reason of the acts to be performed by the Seller hereunder or
otherwise, excluding only Indemnified Losses to the extent (a) a final judgment
of a court of competent jurisdiction holds such Indemnified Losses resulted
solely from gross negligence or willful misconduct of the Indemnified Party
seeking indemnification, (b) solely due to the credit risk of the Obligor and
for which reimbursement would constitute recourse to the Seller or the
Collection Agent for uncollectible Receivables or (c) such Indemnified Losses
include Taxes on, or measured by, the overall net income of the Agent or any
Purchaser computed in accordance with the Intended Tax Characterization;
provided, however, that nothing contained in this sentence shall limit the
liability of the Seller or the Collection Agent or limit the recourse of the
Agent and each Purchaser to the Seller or the Collection Agent for any amounts
otherwise specifically provided to be paid by the Seller or the Collection Agent
hereunder. Without limiting the foregoing indemnification, but subject to the
limitations set forth in clauses (a), (b) and (c) of the previous sentence, the
Seller shall indemnify each Indemnified Party for Indemnified Losses (including
losses in respect of uncollectible Receivables, regardless for these specific
matters whether reimbursement therefor would constitute recourse to the Seller
or the Collection Agent) relating to or resulting from:
(i) any representation or warranty made by the Seller, any
Crompton Entity or the Collection Agent (or any employee or agent of
the Seller, any Crompton Entity or the Collection Agent) under or in
connection with this Agreement, any Periodic Report or any other
information or report delivered by the Seller, any Crompton Entity or
the Collection Agent pursuant hereto, which shall have been false or
incorrect in any material respect when made or deemed made;
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(ii) the failure by the Seller, any Crompton Entity, or the
Collection Agent to comply with any applicable law, rule or regulation
related to any Receivable, or the nonconformity of any Receivable with
any such applicable law, rule or regulation;
(iii) the failure of the Seller to vest and maintain vested in
the Agent, for the benefit of the Purchasers, a perfected ownership or
security interest in the Sold Interest and the property conveyed
pursuant to Section 1.1(e) and Section 1.8, free and clear of any
Adverse Claim;
(iv) any commingling of funds to which the Agent or any
Purchaser is entitled hereunder with any other funds;
(v) any failure of a Lock-Box Bank to comply with the terms
of the applicable Lock-Box Letter;
(vi) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment
of any Receivable, or any other claim resulting from the sale or lease
of goods or the rendering of services related to such Receivable or the
furnishing or failure to furnish any such goods or services or other
similar claim or defense not arising from the financial inability of
any Obligor to pay undisputed indebtedness;
(vii) any failure of the Seller or any Crompton Entity, or any
Affiliate of any thereof, to perform its duties or obligations in
accordance with the provisions of this Agreement or any other
Transaction Document to which such Person is a party (as a Collection
Agent or otherwise);
(viii) any action taken by the Agent as attorney-in-fact for the
Seller pursuant to Section 3.5(b); or
(ix) any environmental liability claim, products liability
claim or personal injury or property damage suit or other similar or
related claim or action of whatever sort, arising out of or in
connection with any Receivable or any other suit, claim or action of
whatever sort relating to any of the Transaction Documents.
Any portion of any indemnity payable hereunder with respect to a Receivable
denominated in a currency other than Dollars that would otherwise be payable in
such foreign currency pursuant to the terms of this Section shall be payable in
Dollars at the applicable Exchange Rate.
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Section 6.2. Increased Cost and Reduced Return. By way of
clarification, and not of limitation, of Section 6.1, if the adoption of any
applicable law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof, or compliance by any
Amsterdam Funding Source, the Agent or any Purchaser (collectively, the "Funding
Parties") with any request or directive (whether or not having the force of law)
of any such Governmental Authority (a "Regulatory Change") (a) subjects any
Funding Party to any charge or withholding on or in connection with a Funding
Agreement or this Agreement (collectively, the "Funding Documents") or any
Receivable, (b) changes the basis of taxation of payments to any of the Funding
Parties of any amounts payable under any of the Funding Documents (except for
changes in the rate of Tax on the overall net income of such Funding Party), (c)
imposes, modifies or deems applicable any reserve, assessment, insurance charge,
special deposit or similar requirement against assets of, deposits with or for
the account of, or any credit extended by, any of the Funding Parties, (d) has
the effect of reducing the rate of return on such Funding Party's capital to a
level below that which such Funding Party could have achieved but for such
adoption, change or compliance (taking into consideration such Funding Party's
policies concerning capital adequacy) or (e) imposes any other condition, and
the result of any of the foregoing is (x) to impose a cost on, or increase the
cost to, any Funding Party of its commitment under any Funding Document or of
purchasing, maintaining or funding any interest acquired under any Funding
Document, (y) to reduce the amount of any sum received or receivable by, or to
reduce the rate of return of, any Funding Party under any Funding Document or
(z) to require any payment calculated by reference to the amount of interests
held or amounts received by it hereunder, then, upon demand by the Agent, the
Seller shall pay to the Agent for the account of the Person such additional
amounts as will compensate the Agent or such Purchaser (or, in the case of
Amsterdam, will enable Amsterdam to compensate any Amsterdam Funding Source) for
such increased cost or reduction. Each Funding Party agrees that on the
occurrence of any event giving rise to the operation of this Section 6.2 with
respect to such Funding Party, it will, if requested by the Seller, use
reasonable efforts (subject to overall policy considerations of such Funding
Party) to designate another office for any credit accommodation affected by such
event, provided that such designation is made on such terms that such Funding
Party and its office suffer no economic, legal or regulatory disadvantage, with
the object of avoiding the consequence of the event giving rise to the operation
of such Section.
Section 6.3. Other Costs and Expenses. Also by way of clarification,
and not of limitation, of Section 6.1, the Seller shall pay to the Agent on
demand all costs and expenses in connection with (a) the preparation, execution,
delivery and administration (including amendments of any provision) of the
Transaction Documents, (b) the sale of the Sold Interest, (c) the perfection of
the Agent's rights in the Receivables and Collections, (d) the enforcement by
the Agent or the Purchasers of the obligations of the Seller under the
Transaction Documents or of any Obligor under a Receivable and (e) the
maintenance by the Agent of the Lock-Boxes and Lock-Box Accounts, including
fees, costs and expenses of legal counsel for the Agent and Amsterdam relating
to any of the foregoing or to advising the Agent, Amsterdam and any Amsterdam
Funding Source about its rights and remedies under any Transaction Document or
any related Funding Agreement and all costs and expenses (including counsel fees
and expenses) of the Agent, each Purchaser and each Amsterdam Funding Source in
connection with the enforcement of the Transaction Documents or any Funding
Agreement and in connection with the administration of the Transaction Documents
following a Termination Event. The Seller shall reimburse the Agent and
Amsterdam for the cost of the Agent's or Amsterdam's auditors (which may be
employees of such Person) auditing the books, records and procedures of the
Seller. The Seller shall reimburse Amsterdam for any amounts Amsterdam must pay
to any Amsterdam Funding Source pursuant to any Funding Agreement on account of
any Tax. The Seller shall reimburse Amsterdam on demand for all other costs and
expenses incurred by Amsterdam or any shareholder of Amsterdam in connection
with the Transaction Documents or the transactions contemplated thereby,
including the cost of auditing Amsterdam's books by certified public
accountants, the cost of the Ratings and the fees and out-of-pocket expenses of
counsel of the Agent, Amsterdam or any shareholder, or administrator, of
Amsterdam for advice relating to Amsterdam's operation.
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Section 6.4. Withholding Taxes. (a) All payments made by the Seller
hereunder shall be made without withholding for or on account of any present or
future taxes (other than overall net income taxes on the recipient). If any such
withholding is so required, the Seller shall make the withholding, pay the
amount withheld to the appropriate authority before penalties attach thereto or
interest accrues thereon and pay such additional amount as may be necessary to
ensure that the net amount actually received by each Purchaser and the Agent
free and clear of such taxes (including such taxes on such additional amount) is
equal to the amount that Purchaser or the Agent (as the case may be) would have
received had such withholding not been made. If the Agent or any Purchaser pays
any such taxes, penalties or interest the Seller shall reimburse the Agent or
such Purchaser for that payment on demand. If the Seller pays any such taxes,
penalties or interest, it shall deliver official tax receipts evidencing that
payment or certified copies thereof to the Purchaser or Agent on whose account
such withholding was made (with a copy to the Agent if not the recipient of the
original) on or before the thirtieth day after payment.
(b) Before the first date on which any amount is payable hereunder for
the account of any Purchaser not incorporated under the laws of the USA such
Purchaser shall deliver to the Seller and the Agent each two (2) duly completed
copies of United States Internal Revenue Service Form W-8BEN or W-8ECI (or
successor applicable form) certifying that such Purchaser is entitled to receive
payments hereunder without deduction or withholding of any United States federal
income taxes. Each such Purchaser shall replace or update such forms when
necessary to maintain any applicable exemption and as requested by the Agent or
the Seller.
Section 6.5. Payments and Allocations. If any Person seeks compensation
pursuant to this Article VI, such Person shall deliver to the Seller and the
Agent a certificate setting forth the amount due to such Person, a description
of the circumstance giving rise thereto and the basis of the calculations of
such amount, which certificate shall be conclusive absent demonstrable error.
The Seller shall pay to the Agent (for the account of such Person) the amount
shown as due on any such certificate within 10 Business Days after receipt of
the notice.
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.1. Conditions to Closing. This Agreement shall become
effective on the first date all conditions in this Section 7.1 are satisfied. On
or before such date, the Seller shall deliver to the Agent the following
documents in form, substance and quantity acceptable to the Agent:
(a) All instruments and other documents required, or deemed
desirable by the Agent, to perfect the Agent's first priority interest
in the Receivables and Collections in all appropriate jurisdictions.
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(b) Such other approvals, opinions or documents as the Agent
or Amsterdam may request.
Section 7.2. Conditions to Each Purchase. The obligation of each
Committed Purchaser to make any Purchase, and the right of the Seller to request
or accept any Purchase, are subject to the conditions (and each Purchase shall
evidence the Seller's representation and warranty that clauses (a)-(e) of this
Section 7.2 have been satisfied) that on the date of such Purchase before and
after giving effect to the Purchase:
(a) no Potential Termination Event shall then exist or shall
occur as a result of the Purchase;
(b) the Liquidity Termination Date has not occurred;
(c) after giving effect to the application of the proceeds of
such Purchase, (x) the outstanding Matured Aggregate Investment would
not exceed the Aggregate Commitment and (y) the outstanding Aggregate
Investment would not exceed the Purchase Limit;
(d) the representations and warranties in Section 4.1 are
true and correct in all material respects on and as of such date
(except to the extent such representations and warranties relate solely
to an earlier date and then as of such earlier date); and
(e) each of the Seller and each Crompton Entity is in full
compliance with the Transaction Documents (including all covenants and
agreements in Article V).
Nothing in this Section 7.2 limits the obligations (including those in Section
2.1) of each Committed Purchaser to Amsterdam (including the Transfer
Agreement).
ARTICLE VIII
THE AGENT
Section 8.1. Appointment and Authorization. Each Purchaser hereby
irrevocably designates and appoints ABN AMRO Bank N.V. as the "Agent" hereunder
and authorizes the Agent to take such actions and to exercise such powers as are
delegated to the Agent hereby and to exercise such other powers as are
reasonably incidental thereto. The Agent shall hold, in its name, for the
benefit of each Purchaser, the Purchase Interest of the Purchaser. The Agent
shall not have any duties other than those expressly set forth herein or any
fiduciary relationship with any Purchaser, and no implied obligations or
liabilities shall be read into this Agreement, or otherwise exist, against the
Agent. The Agent does not assume, nor shall it be deemed to have assumed, any
obligation to, or relationship of trust or agency with, the Seller.
Notwithstanding any provision of this Agreement or any other Transaction
Document, in no event shall the Agent ever be required to take any action which
exposes the Agent to personal liability or which is contrary to the provision of
any Transaction Document or applicable law.
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Section 8.2. Delegation of Duties. The Agent may execute any of its
duties through agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.
Section 8.3. Exculpatory Provisions. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted (i) with the consent or at the direction of the Instructing Group or
(ii) in the absence of such Person's gross negligence or willful misconduct. The
Agent shall not be responsible to any Purchaser or other Person for (i) any
recitals, representations, warranties or other statements made by the Seller,
any Crompton Entity or any of their Affiliates, (ii) the value, validity,
effectiveness, genuineness, enforceability or sufficiency of any Transaction
Document, (iii) any failure of the Seller, any Crompton Entity or any of their
Affiliates to perform any obligation or (iv) the satisfaction of any condition
specified in Article VII. The Agent shall not have any obligation to any
Purchaser to ascertain or inquire about the observance or performance of any
agreement contained in any Transaction Document or to inspect the properties,
books or records of the Seller, any Crompton Entity or any of their Affiliates.
Section 8.4. Reliance by Agent. The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any document,
other writing or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person and upon advice and
statements of legal counsel (including counsel to the Seller), independent
accountants and other experts selected by the Agent. The Agent shall in all
cases be fully justified in failing or refusing to take any action under any
Transaction Document unless it shall first receive such advice or concurrence of
the Purchasers, and assurance of its indemnification, as it deems appropriate.
Section 8.5. Assumed Payments. Unless the Agent shall have received
notice from the applicable Purchaser before the date of any Put or of any
Incremental Purchase that such Purchaser will not make available to the Agent
the amount it is scheduled to remit as part of such Put or Incremental Purchase,
the Agent may assume such Purchaser has made such amount available to the Agent
when due (an "Assumed Payment") and, in reliance upon such assumption, the Agent
may (but shall have no obligation to) make available such amount to the
appropriate Person. If and to the extent that any Purchaser shall not have made
its Assumed Payment available to the Agent, such Purchaser (and the Seller in
the case of any Incremental Purchase) hereby agrees to pay the Agent forthwith
on demand such unpaid portion of such Assumed Payment up to the amount of funds
actually paid by the Agent, together with interest thereon for each day from the
date of such payment by the Agent until the date the requisite amount is repaid
to the Agent, at a rate per annum equal to the Federal Funds Rate plus 2%.
Section 8.6. Notice of Termination Events. The Agent shall not be
deemed to have knowledge or notice of the occurrence of any Potential
Termination Event unless the Agent has received notice from any Purchaser or the
Seller stating that a Potential Termination Event has occurred hereunder and
describing such Potential Termination Event. The Agent shall take such action
concerning a Potential Termination Event as may be directed by the Instructing
Group (or, if required for such action, all of the Purchasers), but until the
Agent receives such directions, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, as the Agent deems
advisable and in the best interests of the Purchasers.
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Section 8.7. Non-Reliance on Agent and Other Purchasers. Each Purchaser
expressly acknowledges that neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or Affiliates has made any
representations or warranties to it and that no act by the Agent hereafter
taken, including any review of the affairs of the Seller or any Crompton Entity,
shall be deemed to constitute any representation or warranty by the Agent. Each
Purchaser represents and warrants to the Agent that, independently and without
reliance upon the Agent or any other Purchaser and based on such documents and
information as it has deemed appropriate, it has made and will continue to make
its own appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of the Seller,
the Crompton Entities, and the Receivables and its own decision to enter into
this Agreement and to take, or omit, action under any Transaction Document. The
Agent shall deliver each month to any Purchaser that so requests a copy of the
Periodic Report(s) received covering the preceding calendar month. Except for
items specifically required to be delivered hereunder, the Agent shall not have
any duty or responsibility to provide any Purchaser with any information
concerning the Seller, any Crompton Entity or any of their Affiliates that comes
into the possession of the Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or Affiliates.
Section 8.8. Agent and Affiliates. The Agent and its Affiliates may
extend credit to, accept deposits from and generally engage in any kind of
business with the Seller, any Crompton Entity or any of their Affiliates and, in
its roles as a Liquidity Provider, ABN AMRO may exercise or refrain from
exercising its rights and powers as if it were not the Agent. The parties
acknowledge that ABN AMRO acts as agent for Amsterdam and subagent for
Amsterdam's management company in various capacities, as well as providing
credit facilities and other support for Amsterdam not contained in the
Transaction Documents.
Section 8.9. Indemnification. Each Committed Purchaser shall indemnify
and hold harmless the Agent and its officers, directors, employees,
representatives and agents (to the extent not reimbursed by the Seller or any
Crompton Entity and without limiting the obligation of the Seller or any
Crompton Entity to do so), ratably in accordance with its Ratable Share from and
against any and all liabilities, obligations, losses, damages, penalties,
judgments, settlements, costs, expenses and disbursements of any kind whatsoever
(including in connection with any investigative or threatened proceeding,
whether or not the Agent or such Person shall be designated a party thereto)
that may at any time be imposed on, incurred by or asserted against the Agent or
such Person as a result of, or related to, any of the transactions contemplated
by the Transaction Documents or the execution, delivery or performance of the
Transaction Documents or any other document furnished in connection therewith
(but excluding any such liabilities, obligations, losses, damages, penalties,
judgments, settlements, costs, expenses or disbursements resulting solely from
the gross negligence or willful misconduct of the Agent or such Person as
finally determined by a court of competent jurisdiction).
Section 8.10. Successor Agent. The Agent may, upon at least five (5)
days notice to the Seller and each Purchaser, resign as Agent. Such resignation
shall not become effective until a successor agent is appointed by an
Instructing Group and has accepted such appointment. Upon such acceptance of its
appointment as Agent hereunder by a successor Agent, such successor Agent shall
succeed to and become vested with all the rights and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under the Transaction Documents. After any retiring Agent's
resignation hereunder, the provisions of Article VI and this Article VIII shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was the Agent.
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ARTICLE IX
MISCELLANEOUS
Section 9.1. Termination. Amsterdam shall cease to be a party hereto
when the Amsterdam Termination Date has occurred, Amsterdam holds no Investment
and all amounts payable to it hereunder have been indefeasibly paid in full.
This Agreement shall terminate following the Liquidity Termination Date when no
Investment is held by a Purchaser and all other amounts payable hereunder have
been indefeasibly paid in full, but the rights and remedies of the Agent and
each Purchaser concerning any representation, warranty or covenant made, or
deemed to be made, by the Seller and under Article VI and Section 8.9 shall
survive such termination.
Section 9.2. Notices. Unless otherwise specified, all notices and other
communications hereunder shall be in writing (including by telecopier or other
facsimile communication), given to the appropriate Person at its address or
telecopy number set forth on the signature pages hereof or at such other address
or telecopy number as such Person may specify, and effective when received at
the address specified by such Person. Each party hereto, however, authorizes the
Agent to act on telephone notices of Purchases, Puts, and Discount Rate and
Tranche Period selections from any person the Agent in good faith believes to be
acting on behalf of the relevant party and, at the Agent's option, to tape
record any such telephone conversation. Each party hereto agrees to deliver
promptly to the Agent a confirmation of each telephone notice given or received
by such party (signed by an authorized officer of such party), but the absence
of such confirmation shall not affect the validity of the telephone notice. The
Agent's records of all such conversations shall be deemed correct and, if the
confirmation of a conversation differs in any material respect from the action
taken by the Agent, the records of the Agent shall govern absent manifest error.
The number of days for any advance notice required hereunder may be waived
(orally or in writing) by the Person receiving such notice and, in the case of
notices to the Agent, the consent of each Person to which the Agent is required
to forward such notice.
Section 9.3. Payments and Computations. Notwithstanding anything herein
to the contrary, any amounts to be paid or transferred by the Seller or the
Collection Agent to, or for the benefit of, any Purchaser or any other Person
shall be paid or transferred to the Agent (for the benefit of such Purchaser or
other Person). The Agent shall promptly (and, if reasonably practicable, on the
day it receives such amounts) forward each such amount to the Person entitled
thereto and such Person shall apply the amount in accordance herewith. All
amounts to be paid or deposited hereunder shall be paid or transferred on the
day when due in immediately available Dollars (and, if due from the Seller or
Collection Agent, by 11:00 a.m. (Chicago time), with amounts received after such
time being deemed paid on the Business Day following such receipt). The Seller
hereby authorizes the Agent to debit the Seller Account for application to any
amounts owed by the Seller hereunder. The Seller shall, to the extent permitted
by law, pay to the Agent upon demand, for the account of the applicable Person,
interest on all amounts not paid or transferred by the Seller or the Collection
Agent when due hereunder at a rate equal to the Prime Rate plus 2%, calculated
from the date any such amount became due until the date paid in full. Any
payment or other transfer of funds scheduled to be made on a day that is not a
Business Day shall be made on the next Business Day, and any Discount Rate or
interest rate accruing on such amount to be paid or transferred shall continue
to accrue to such next Business Day. All computations of interest, fees, and
Discount shall be calculated for the actual days elapsed based on a 360 day
year.
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Section 9.4. Sharing of Recoveries. Each Purchaser agrees that if it
receives any recovery, through set-off, judicial action or otherwise, on any
amount payable or recoverable hereunder in a greater proportion than should have
been received hereunder or otherwise inconsistent with the provisions hereof,
then the recipient of such recovery shall purchase for cash an interest in
amounts owing to the other Purchasers (as return of Investment or otherwise),
without representation or warranty except for the representation and warranty
that such interest is being sold by each such other Purchaser free and clear of
any Adverse Claim created or granted by such other Purchaser, in the amount
necessary to create proportional participation by the Purchasers in such
recovery (as if such recovery were distributed pursuant to Section 2.3). If all
or any portion of such amount is thereafter recovered from the recipient, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.
Section 9.5. Right of Setoff. During a Termination Event, each
Purchaser is hereby authorized (in addition to any other rights it may have) to
setoff, appropriate and apply (without presentment, demand, protest or other
notice which are hereby expressly waived) any deposits and any other
indebtedness held or owing by such Purchaser (including by any branches or
agencies of such Purchaser) to, or for the account of, the Seller against
amounts owing by the Seller hereunder (even if contingent or unmatured).
Section 9.6. Amendments. Except as otherwise expressly provided herein,
no amendment or waiver hereof shall be effective unless signed by the Seller and
the Instructing Group. In addition, no amendment hereof shall, without the
consent of (a) all the Liquidity Providers, (i) extend the Liquidity Termination
Date or the date of any payment or transfer of Collections by the Seller to the
Collection Agent or by the Collection Agent to the Agent, (ii) reduce the rate
or extend the time of payment of Discount for any Eurodollar Tranche or Prime
Tranche, (iii) reduce or extend the time of payment of any fee payable to the
Liquidity Providers, (iv) except as provided herein, release, transfer or modify
any Committed Purchaser's Purchase Interest or change any Commitment, (v) amend
the definition of Required Liquidity Providers, Instructing Group, Termination
Event or Section 1.1, 1.2, 1.5, 1.7(a), 2.1, 2.2, 2.3, 7.2 or 9.6, Article VI,
or any obligation of any Crompton Entity thereunder, (vi) consent to the
assignment or transfer by the Seller or any Originator of any interest in the
Receivables other than transfers under the Transaction Documents or permit any
Crompton Entity to transfer any of its obligations under any Transaction
Document except as expressly contemplated by the terms of the Transaction
Documents, or (vii) amend any defined term relevant to the restrictions in
clauses (i) through (vi) in a manner which would circumvent the intention of
such restrictions or (b) the Agent, amend any provision hereof if the effect
thereof is to affect the indemnities to, or the rights or duties of, the Agent
or to reduce any fee payable for the Agent's own account. Notwithstanding the
foregoing, the amount of any fee or other payment due and payable from the
Seller to the Agent (for its own account), Amsterdam may be changed or otherwise
adjusted solely with the consent of the Seller and the party to which such
payment is payable. Any amendment hereof shall apply to each Purchaser equally
and shall be binding upon the Seller, the Purchasers and the Agent.
-29-
Section 9.7. Waivers. No failure or delay of the Agent or any Purchaser
in exercising any power, right, privilege or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right, privilege or remedy preclude any other or further exercise thereof or the
exercise of any other power, right, privilege or remedy. Any waiver hereof shall
be effective only in the specific instance and for the specific purpose for
which such waiver was given. After any waiver, the Seller, the Purchasers and
the Agent shall be restored to their former position and rights and any
Potential Termination Event waived shall be deemed to be cured and not
continuing, but no such waiver shall extend to (or impair any right consequent
upon) any subsequent or other Potential Termination Event. Any additional
Discount that has accrued after a Termination Event before the execution of a
waiver thereof, solely as a result of the occurrence of such Termination Event,
may be waived by the Agent at the direction of the Purchaser entitled thereto
or, in the case of Discount owing to the Liquidity Providers, of the Required
Liquidity Providers.
Section 9.8. Successors and Assigns; Participations; Assignments.
(a) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns. Except as otherwise provided herein, the Seller may not assign or
transfer any of its rights or delegate any of its duties without the prior
consent of the Agent and the Purchasers.
(b) Participations. Any Purchaser may sell to one or more Persons (each
a "Participant") participating interests in the interests of such Purchaser
hereunder and under the Transfer Agreement. Such Purchaser shall remain solely
responsible for performing its obligations hereunder, and the Seller and the
Agent shall continue to deal solely and directly with such Purchaser in
connection with such Purchaser's rights and obligations hereunder and under the
Transfer Agreement. Each Participant shall be entitled to the benefits of
Article VI and shall have the right of setoff through its participation in
amounts owing hereunder and under the Transfer Agreement to the same extent as
if it were a Purchaser hereunder and under the Transfer Agreement, which right
of setoff is subject to such Participant's obligation to share with the
Purchasers as provided in Section 9.4. A Purchaser shall not agree with a
Participant to restrict such Purchaser's right to agree to any amendment hereto
or to the Transfer Agreement, except amendments described in clause (a) of
Section 9.6.
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(c) Assignments by Liquidity Providers. Any Liquidity Provider may
assign to one or more Persons ("Purchasing Liquidity Providers"), acceptable to
the Agent in its sole discretion, any portion of its Commitment as a Liquidity
Provider hereunder and under the Transfer Agreement and Purchase Interest
pursuant to a supplement hereto and to the Transfer Agreement (a "Transfer
Supplement") in form satisfactory to the Agent executed by each such Purchasing
Liquidity Provider, such selling Liquidity Provider and the Agent. Any such
assignment by a Liquidity Provider must be for an amount of at least Five
Million Dollars. Each Purchasing Liquidity Provider shall pay a fee of Three
Thousand Dollars to the Agent. Any partial assignment shall be an assignment of
an identical percentage of such selling Liquidity Provider's Investment and its
Commitment as a Liquidity Provider hereunder and under the Transfer Agreement.
Upon the execution and delivery to the Agent of the Transfer Supplement and
payment by the Purchasing Liquidity Provider to the selling Liquidity Provider
of the agreed purchase price, such selling Liquidity Provider shall be released
from its obligations hereunder and under the Transfer Agreement to the extent of
such assignment and such Purchasing Liquidity Provider shall for all purposes be
a Liquidity Provider party hereto and shall have all the rights and obligations
of a Liquidity Provider hereunder and under the Transfer Agreement to the same
extent as if it were an original party hereto and to the Transfer Agreement with
a Commitment as a Liquidity Provider, an Investment and any related Assigned
Amsterdam Settlement described in the Transfer Supplement.
(d) Replaceable Liquidity Providers. If any Liquidity Provider (a
"Replaceable Liquidity Provider") shall (i) petition the Seller for any amounts
under Section 6.2 or (ii) cease to have a short-term debt rating of "A-1" by S&P
and "P-1" by Xxxxx'x, the Seller or Amsterdam may designate a replacement
financial institution (a "Replacement Liquidity Provider") acceptable to the
Agent, in its sole discretion, to which such Replaceable Liquidity Provider
shall, subject to its receipt of an amount equal to its Investment, any related
Assigned Amsterdam Settlement, and accrued Discount and fees thereon and all
amounts payable under Section 6.2, promptly assign all of its rights,
obligations and Liquidity Provider Commitment hereunder and under the Transfer
Agreement, together with all of its Purchase Interest, and any related Assigned
Amsterdam Settlement, to the Replacement Liquidity Provider in accordance with
Section 9.8(c).
(e) Assignment by Amsterdam. Each party hereto agrees and consents (i)
to Amsterdam's assignment, participation, grant of security interests in or
other transfers of any portion of, or any of its beneficial interest in, the
Amsterdam Purchase Interest and the Amsterdam Settlement and (ii) to the
complete assignment by Amsterdam of all of its rights and obligations hereunder
to ABN AMRO or any other Person, and upon such assignment Amsterdam shall be
released from all obligations and duties hereunder; provided, however, that
Amsterdam may not, without the prior consent of the Required Liquidity Providers
transfer any of its rights hereunder or under the Transfer Agreement to cause
the Liquidity Providers to purchase the Amsterdam Purchase Interest and the
Amsterdam Settlement unless the assignee (i) is a corporation whose principal
business is the purchase of assets similar to the Receivables, (ii) has ABN AMRO
as its administrative agent and (iii) issues commercial paper with credit
ratings substantially comparable to the Ratings. Amsterdam shall promptly notify
each party hereto of any such assignment. Upon such an assignment of any portion
of Amsterdam's Purchase Interest and the Amsterdam Settlement, the assignee
shall have all of the rights of Amsterdam hereunder relate to such Amsterdam
Purchase Interest and Amsterdam Settlement.
-31-
(f) Opinions of Counsel. If required by the Agent or to maintain the
Ratings, each Transfer Supplement must be accompanied by an opinion of counsel
of the assignee as to such matters as the Agent may reasonably request.
Section 9.9. Intended Tax Characterization. It is the intention of the
parties hereto that, for the purposes of all Taxes, the transactions
contemplated hereby shall be treated as a loan by the Purchasers (through the
Agent) to the Seller that is secured by the Receivables (the "Intended Tax
Characterization"). The parties hereto agree to report and otherwise to act for
the purposes of all Taxes in a manner consistent with the Intended Tax
Characterization. As provided in Section 5.1(g), the Seller hereby grants to the
Agent, for the ratable benefit of the Purchasers, a security interest in all
Receivables and Collections to secure the payment of all amounts other than
Investment owing hereunder and (to the extent of the Sold Interest) to secure
the repayment of all Investment.
Section 9.10. Waiver of Confidentiality. The Seller hereby consents to
the disclosure of any nonpublic information relating to the Seller, any
Affiliate, or the Transaction Documents among the Agent and the Purchasers and
by the Agent or the Purchasers to (i) any officers, directors, members,
managers, employees or outside accountants, auditors or attorneys thereof, (ii)
any prospective or actual assignee or participant, (iii) any rating agency,
surety, guarantor or credit or liquidity enhancer to the Agent or any Purchaser,
(iv) any entity organized to purchase, or make loans secured by, financial
assets for which ABN AMRO provides managerial services or acts as an
administrative agent, (v) Amsterdam's administrator, management company,
referral agents, issuing agents or depositaries or CP Dealers and (vi)
Governmental Authorities with appropriate jurisdiction.
Section 9.11. Confidentiality of Agreement. Unless otherwise consented
to by the Agent, the Seller hereby will not disclose the contents of any
Transaction Document, or any other confidential or proprietary information
furnished by the Agent or any Purchaser, to any Person other than to (i) its
auditors and attorneys, Affiliates, officers, directors, members, managers,
employees, outside accountants or as required by applicable law or (ii)
Governmental Authorities with appropriate jurisdiction. Notwithstanding any
provision in the Transaction Documents to the contrary, each party to the
transactions contemplated by the Transaction Document (and each employee,
representative, or other agent of each such party) may disclose to any and all
persons, without limitation of any kind, the tax treatment and tax structure of
the transactions and all materials of any kind (including opinions or other tax
analyses) that are provided to such party relating to such tax treatment and tax
structure.
Section 9.12. Agreement Not to Petition. Each party hereto agrees, for
the benefit of the holders of the privately or publicly placed indebtedness for
borrowed money for Amsterdam, not, prior to the date which is one (1) year and
one (1) day after the payment in full of all such indebtedness, to acquiesce,
petition or otherwise, directly or indirectly, invoke, or cause Amsterdam to
invoke, the process of any Governmental Authority for the purpose of (a)
commencing or sustaining a case against Amsterdam under any federal or state
bankruptcy, insolvency or similar law (including the Federal Bankruptcy Code),
(b) appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official for Amsterdam, or any substantial part of
its property, or (c) ordering the winding up or liquidation of the affairs of
Amsterdam. The provisions of this Section 9.12 shall survive termination of this
Agreement.
-32-
Section 9.13. Excess Funds. Notwithstanding any provisions contained in
this Agreement to the contrary, Amsterdam shall not, and shall not be obligated
to, pay any amount pursuant to this Agreement unless (i) Amsterdam has received
funds which may be used to make such payment and which funds are not required to
repay its commercial paper notes when due and (ii) after giving effect to such
payment, either (x) Amsterdam could issue commercial paper notes to refinance
all of its outstanding commercial paper notes (assuming such outstanding
commercial paper notes matured at such time) in accordance with the program
documents governing Amsterdam's securitization program or (y) all of Amsterdam's
commercial paper notes are paid in full. Any amount which Amsterdam does not pay
pursuant to the operation of the preceding sentence shall not constitute a claim
(as defined in ss.101 of the United States Bankruptcy Code) against or corporate
obligation of Amsterdam for any such insufficiency unless and until Amsterdam
satisfies the provisions of clauses (i) and (ii) above. This Section shall
survive the termination of this Agreement.
Section 9.14. No Recourse. The obligations of Amsterdam, its management
company, its administrator and its referral agents (each a "Program
Administrator") under any Transaction Document or other document (each, a
"Program Document") to which a Program Administrator is a party are solely the
corporate obligations of such Program Administrator and no recourse shall be had
for such obligations against any Affiliate, director, officer, member, manager,
employee, attorney or agent of any Program Administrator.
Section 9.15. Limitation of Liability. No Person shall make a claim
against the Agent or any Purchaser (or their respective Affiliates, directors,
officers, members, managers, employees, attorneys or agents) for any special,
indirect, consequential or punitive damages under any claim for breach of
contract or other theory of liability in connection with the Transaction
Documents or the transactions contemplated thereby, and the Seller (for itself,
the Collection Agent and all other Persons claiming by or through the Seller)
hereby waives any claim for any such damages.
Section 9.16. Headings; Counterparts. Article and Section Headings in
this Agreement are for reference only and shall not affect the construction of
this Agreement. This Agreement may be executed by different parties on any
number of counterparts, each of which shall constitute an original and all of
which, taken together, shall constitute one and the same agreement.
Section 9.17. Cumulative Rights and Severability. All rights and
remedies of the Purchasers and Agent hereunder shall be cumulative and
non-exclusive of any rights or remedies such Persons have under law or
otherwise. Any provision hereof that is prohibited or unenforceable in any
jurisdiction shall, in such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof and without affecting such provision in any other jurisdiction.
-33-
Section 9.18. Governing Law; Submission to Jurisdiction. This Agreement
shall be governed by, and construed in accordance with, the internal laws (and
not the law of conflicts) of the State of New York. The Seller hereby submits to
the nonexclusive jurisdiction of the United States District Court for the
Southern District of New York and of any New York state court sitting in New
York, New York for purposes of all legal proceedings arising out of, or relating
to, the Transaction Documents or the transactions contemplated thereby. The
Seller hereby irrevocably waives, to the fullest extent permitted by law, any
objection it may now or hereafter have to the venue of any such proceeding and
any claim that any such proceeding has been brought in an inconvenient forum.
Nothing in this Section 9.18 shall affect the right of the Agent or any
Purchaser to bring any action or proceeding against the Seller or its property
in the courts of other jurisdictions.
Section 9.19. WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, EACH PARTY HERETO IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF, OR IN CONNECTION WITH,
ANY TRANSACTION DOCUMENT OR ANY MATTER ARISING THEREUNDER.
Section 9.20. Entire Agreement. The Transaction Documents constitute the
entire understanding of the parties thereto concerning the subject matter
thereof. Any previous or contemporaneous agreements, whether written or oral,
concerning such matters are superseded thereby.
Section 9.21. Elimination of Enhancer. From and after the date hereof,
the Enhancer shall no longer be a party to this Agreement and shall not have a
commitment hereunder.
Section 9.22. Original Agreement. This Agreement amends and replaces in
its entirety the Original Agreement. Reference to this specific Agreement need
not be made in any agreement, document, instrument, letter, certificate, the
Original Agreement itself, or any communication issued or made pursuant to or
with respect to the Original Agreement, any reference to the Original Agreement
being sufficient to refer to the Original Agreement as amended and restated
hereby.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
ABN AMRO BANK N.V., as the Agent ABN AMRO BANK N.V., as a Liquidity Provider
By: /s/ Xxxxxx X. Educate By: /s/ Xxxxxx X. Educate
-------------------------------------- ----------------------------------------
Name: Xxxxxx X. Educate Name: Xxxxxx X. Educate
Title: Senior Vice President Title: Senior Vice President
By: /s/ Xxxxx X. Xxxx By: /s/ Xxxxx X. Xxxx
-------------------------------------- ----------------------------------------
Name: Xxxxx X. Xxxx Name: Xxxxx X. Xxxx
Title: Vice President Title: Vice President
Address: Structured Finance, Address: Structured Finance,
Asset Securitization Asset Securitization
000 Xxxxx XxXxxxx Xxxxxx 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000 Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Purchaser Agent Attention: Administrator-
Telephone: (000) 000-0000 Amsterdam
Telecopy: (000) 000-0000 Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-35-
AMSTERDAM FUNDING CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Address: c/o Global Securitization
Services, LLC
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
CONSENTED AND AGREED:
ABN AMRO BANK N.V., as the Enhancer
By: /s/ Xxxxxx X. Educate
------------------------------------
Name: Xxxxxx X. Educate
Title: Senior Vice President
By: /s/ Xxxxx X. Xxxx
------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President
Address: Structured Finance,
Asset Securitization
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Enhancer - Amsterdam
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
-00-
XXXXXXXX & XXXXXXX XXXXXXXXXXX XXXXXXXX CORPORATION,
CORPORATION, as Seller as Initial Collection Agent
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxx Xxxxxxxxxxx
By: Xxxxxxx X. Xxxxx By: Xxxxxx Xxxxxxxxxxx
--------------------------------------- -----------------------------------
Title: Assistant Treasurer Title: Assistant Treasurer
Address: Xxxxxx Road Address: Xxxxxx Road
Middlebury, Connecticut 06749 Xxxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxx X. Attention: Xxxxxx X.
Xxxxxxxxxxx Xxxxxxxxxxx
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
Notices sent to: Notices sent to:
Xxxxxx Xxxx Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000 Xxxxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxxx Attention: Xxxxxx X. Xxxxxxxxxxx
With a copy to: With a copy to:
CROMPTON CORPORATION CROMPTON CORPORATION
Xxxxxx Xxxx Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000 Xxxxxxxxxx, Xxxxxxxxxxx 00000
-37-
SCHEDULE I
DEFINITIONS
The following terms have the meanings set forth, or referred to, below:
"ABN AMRO" means ABN AMRO Bank N.V. in its individual capacity and not
in its capacity as the Agent.
"Adverse Claim" means, for any asset or property of a Person, a lien,
security interest, charge, mortgage, pledge, hypothecation, assignment or
encumbrance, or any other right or claim, in, of or on such asset or property in
favor of any other Person, except (i) those in favor of the Agent and (ii) liens
for taxes, assessments or charges of any Governmental Authority (other than Tax
or ERISA liens) and liens of landlords, carriers, warehousemen, mechanics and
materialmen imposed by law in the ordinary course of business, in each case (a)
for amounts not yet due or (b) which are being contested in good faith by
appropriate proceedings and with respect to which adequate reserves or other
appropriate provisions are being maintained in accordance with GAAP.
"Affiliate" means, for any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with
such Person. For purposes of this definition, "control" means the power,
directly or indirectly, to cause the direction of the management and policies of
a Person.
"Agent" is defined in the first paragraph hereof.
"Agent's Account" means the account designated to the Seller and the
Purchasers by the Agent.
"Aggregate Commitment" means $127,500,000, as such amount may be
reduced pursuant to Section 1.6.
"Aggregate Investment" means the sum of the Investments of all
Purchasers.
"Aggregate Reserve" means, at any time at which such amount is
calculated, the sum of the Loss Reserve, Dilution Reserve and Discount Reserve.
"Allocated Commercial Paper" means commercial paper notes issued by
Amsterdam for a tenor and in an amount specifically requested by any Person in
connection with a Receivable Purchase Facility.
"Amsterdam" is defined in the first paragraph hereof.
"Amsterdam Funding Source" means any insurance company, bank or other
financial institution providing liquidity, back-up purchase or credit support
for Amsterdam.
"Amsterdam Settlement" means the sum of all claims and rights to
payment pursuant to Section 1.5 or 1.7 or any other provision owed to Amsterdam
(or owed to the Agent or the Collection Agent for the benefit of Amsterdam) by
the Seller that, if paid, would be applied to reduce Amsterdam's Investment.
"Amsterdam Termination Date" means the earliest of (a) the Business Day
designated by Amsterdam at any time to the Seller and (c) the Liquidity
Termination Date.
"Assigned Amsterdam Settlement" means, for each Committed Purchaser for
any Put, the product of such Purchaser's Purchased Percentage and the amount of
the Amsterdam Settlement being transferred pursuant to such Put.
"Bankruptcy Event" means, for any Person, that (a) such Person makes a
general assignment for the benefit of creditors or any proceeding is instituted
by or against such Person seeking to adjudicate it bankrupt or insolvent, or
seeking the liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee or other
similar official for it or any substantial part of its property or (b) such
Person takes any corporate action to authorize any such action.
"Break Funding Costs" means for any Pool Funded Purchase Interest
amounts payable to Amsterdam under the applicable Receivables Purchase Facility
in connection with any prepayment or amortization if amounts payable thereunder
in excess of the amount of the investment or loan prepaid or amortized and
accrued and unpaid interest or discount thereon.
"Business Day" means any day other than (a) a Saturday, Sunday or other
day on which banks in the States of New York, Connecticut or Illinois are
authorized or required to close, (b) a holiday on the Federal Reserve calendar
and, (c) solely for matters relating to a Eurodollar Tranche, a day on which
dealings in Dollars are not carried on in the London interbank market.
"Charge-Off" means any Receivable that has or should have been (in
accordance with the Credit and Collection Policy) charged off or written off by
the Seller.
"Collection" means any amount paid, or deemed paid, on a Receivable,
including from the proceeds of collateral securing, or any guaranty of, such
Receivable or by the Seller under Section 1.5(b).
"Collection Agent" is defined in Section 3.1(a).
"Collection Agent Replacement Event" means the occurrence of any one or
more of the following:
(a) any failure by the Collection Agent to make any payment,
transfer or deposit required by any Transaction Document to be made by
it which failure continues unremedied for one Business Day;
I-2
(b) failure on the part of the Collection Agent to observe or
perform any covenant or agreement contained in Sections 3.2 or 3.3 of
this Agreement;
(c) failure on the part of the Collection Agent to observe or
perform any other covenant or agreement set forth in this Agreement or
any other Transaction Document, which failure has a material adverse
effect on any Purchaser and continues unremedied for a period of 30
days after the earlier of (i) the date on which written notice of the
failure, requiring the same to be remedied, shall have been given to
the Collection Agent by any Purchaser, or to and (ii) the date on which
the Collection Agent became aware of such failure;
(d) the Daily Report shall fail to have been correct in any
material respect when made or delivered or shall not have been
delivered when required under the terms hereof;
(e) the Monthly Report shall fail to have been correct in any
material respect when made or delivered, or shall not have been
delivered when required under the terms hereof, and such condition
continues unremedied for a period of three Business Days;
(f) any written representation, warranty, certification or
statement made by the Collection Agent in, or pursuant to, any
Transaction Document proves to have been incorrect in any material
adverse respect when made; or
(g) the Collection Agent suffers a Bankruptcy Event.
"Collection Agent Fee" is defined in Section 3.6.
"Commitment" means, for each Committed Purchaser, the amount set forth
on Schedule II, as adjusted in accordance with Sections 1.6 and 9.8.
"Committed Purchasers" is defined in Section 1.1(b).
"Concentration Limit" means (i) with respect to Obligors (other than
Obligors on Foreign Receivables described in subclause (II) of clause (i) of the
definition of Eligible Receivables) with senior unsecured long-term indebtedness
rated A- (or higher) by S&P or A3 (or higher) by Xxxxx'x, an amount not to
exceed 5% of the Eligible Receivables Balance, and (ii) with respect to all
other Obligors, an amount not to exceed 3% of the Eligible Receivables Balance.
"CP Dealer" means, at any time, each Person Amsterdam then engages as a
placement agent or commercial paper dealer.
I-3
"CP Rate" means, for any CP Tranche Period, a rate per annum equal to
(a) the weighted average of the rates at which commercial paper notes having a
term equal to such CP Tranche Period may be sold by any CP Dealer selected by
Amsterdam, as agreed between each such CP Dealer and Amsterdam, plus (b) on or
after the occurrence of a Termination Event, 2%. If such rate is a discount
rate, the CP Rate shall be the rate resulting from Amsterdam's converting such
discount rate to an interest-bearing equivalent rate. If Amsterdam determines
that due to disruptions in the commercial paper market that it is unable to
issue commercial paper, then the CP Rate shall be the Prime Rate for so long as
such condition shall continue. The CP Rate shall include all costs and expenses
to Amsterdam of issuing the related commercial paper notes, including all dealer
commissions and note issuance costs in connection therewith.
"Credit and Collection Policy" means the Seller's credit and collection
policy and practices relating to Receivables attached hereto as Exhibit I.
"Crompton Credit Agreement" means that certain Credit Agreement, dated
as of August 16, 2004, among Crompton Corporation, various lending institutions,
Deutsche Bank AG, Cayman Islands Branch, as Deposit Bank and Deutsche Bank AG
New York Branch, as Administrative Agent.
"Crompton Entity" means the Parent and each Originator.
"Daily Reporting Period" means, any period during which (i) the senior
unsecured long-term debt of the Parent is rated less than BB- by S&P or Ba3 by
Xxxxx'x (or either such rating is suspended or withdrawn) or (ii) a Financial
Covenant Grace Period exists.
"Deemed Collections" is defined in Section 1.5(c).
"Default Multiple" means the following amounts based upon the long-term
senior unsecured credit rating of the Parent:
---------------------- ----------------------- ----------------
Credit Ratings Credit Ratings
for Parent for Parent
Xxxxx'x S&P Default Multiple
---------------------- ----------------------- ----------------
Baa3 or greater BBB- or greater 1.50x
---------------------- ----------------------- ----------------
Ba1 BB+ 1.50x
---------------------- ----------------------- ----------------
Ba2 BB 1.75x
---------------------- ----------------------- ----------------
Ba3 BB- 2.0x
---------------------- ----------------------- ----------------
Below Ba3 or no rating Below BB- or no rating 2.5x
---------------------- ----------------------- ----------------
If the ratings of the Parent from Xxxxx'x and S&P would result in different
Default Multiples, the greater Default Multiple shall apply. Notwithstanding the
foregoing, during any Financial Covenant Grace Period the Default Multiple shall
equal 2.5x.
"Default Ratio" means, at any time, the ratio of (a) the then aggregate
outstanding balance of all Defaulted Receivables (minus Charge-Offs) to (b) the
then aggregate outstanding balance of all Receivables (minus Charge-Offs).
"Defaulted Receivable" means any Receivable (a) on which any amount is
unpaid more than (i) for Xxxxx-Standard Corporation, 90 days past its original
invoice date and (ii) for all other Originators, 90 days past its original due
date, or (b) the Obligor on which has suffered a Bankruptcy Event.
I-4
"Delinquency Multiple" means the following amounts based upon the
long-term senior unsecured credit rating of the Parent:
---------------------- ---------------------- --------------------
Credit Ratings Credit Ratings
for Parent for Parent
Xxxxx'x S&P Delinquency Multiple
---------------------- ---------------------- --------------------
Baa3 or greater BBB- or greater 2.0x
---------------------- ---------------------- --------------------
Ba1 BB+ 2.25x
---------------------- ---------------------- --------------------
Ba2 BB 2.5x
---------------------- ---------------------- --------------------
Ba3 BB- 3.0x
---------------------- ---------------------- --------------------
Below Ba3 or no rating Below BB- or no rating 4.0x
---------------------- ---------------------- --------------------
If the ratings of the Parent from Xxxxx'x and S&P would result in different
Delinquency Multiples, the greater Delinquency Multiple shall apply.
Notwithstanding the foregoing, during any Financial Covenant Grace Period the
Delinquency Multiple shall equal 4.0x.
"Delinquency Ratio" means, at any time, the ratio of (a) the then
aggregate outstanding balance of all Delinquent Receivables to (b) the then
aggregate outstanding balance of all Receivables.
"Delinquent Receivable" means any Receivable (other than a Charge-Off
or Defaulted Receivable) on which any amount is unpaid more than (i) for Xxxxx
Standard Corporation, 31-90 days past its original invoice date and (ii) for all
other Originators, 31-90 days past its original due date.
"Deposit Date" means each day on which any Collections are deposited in
any Lock-Box Account or on which the Collection Agent receives any Collections.
"Designated Financial Officer" means each of Chief Financial Officer,
Treasurer and Assistant Treasurer.
"Dilution Ratio" means, for any period, the ratio computed by dividing
(a) the aggregate amount of payments owed by the Seller pursuant to the first
sentence of Section 1.5(b) during such period by (b) the aggregate amount of
Collections received during such period.
"Dilution Reserve" means, the product of (a) the Dilution Reserve
Multiple times the highest three consecutive month average Dilution Ratio
(expressed as a decimal) as of the last day of each of the last twelve calendar
months, and (b) the Eligible Receivables Balance.
"Dilution Reserve Multiple" means the following amounts based upon the
long-term senior unsecured credit rating of the Parent:
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---------------------- ---------------------- ----------------
Credit Ratings Credit Ratings
for Parent for Parent Dilution
Xxxxx'x S&P Reserve Multiple
---------------------- ---------------------- ----------------
Baa3 or greater BBB- or greater 2.5x
---------------------- ---------------------- ----------------
Ba1 BB+ 3.0x
---------------------- ---------------------- ----------------
Ba2 BB 3.5x
---------------------- ---------------------- ----------------
Ba3 BB- 4.0x
---------------------- ---------------------- ----------------
Below Ba3 or no rating Below BB- or no rating 5.0x
---------------------- ---------------------- ----------------
If the ratings of the Parent from Xxxxx'x and S&P would result in different
Dilution Reserve Multiples, the greater Dilution Reserve Multiple shall apply.
Notwithstanding the foregoing, during any Financial Covenant Grace Period the
Dilution Reserve Multiple shall equal 5.0x.
"Discount" means, for any Tranche Period, (a) the product of (i) the
Discount Rate for such Tranche Period, (ii) the total amount of Investment
allocated to the Tranche Period, and (iii) the number of days elapsed during the
Tranche Period divided by (b) 360 days.
"Discount Period" means, with respect to any Settlement Date or the
Liquidity Termination Date, the period from and including the preceding
Settlement Date (or if none, the date that the first Incremental Purchase is
made hereunder) to but not including such Settlement Date or Liquidity
Termination Date, as applicable.
"Discount Rate" means, for any Tranche Period, the CP Rate, the
Eurodollar Rate or the Prime Rate, as applicable.
"Discount Reserve" means, at any time, the product of (a) 1.5
multiplied by (b) the rate announced by ABN AMRO as its "Prime Rate" (which may
not be its best or lowest rate) plus 100 basis points (1.00%) multiplied by (c)
Aggregate Investment multiplied by (d) a fraction, the numerator of which is the
average Turnover Rate as of the last day of the last three calendar months and
the denominator of which is 360.
"Dollar" and "$" means lawful currency of the United States of America.
"Early Payment Fee" means, if any Investment of a Purchaser allocated
(or, in the case of a requested Purchase not made by the Committed Purchasers
for any reason other than their default, scheduled to be allocated) to a Tranche
Period for a CP Tranche or Eurodollar Tranche is reduced or terminated before
the last day of such Tranche Period (the amount of Investment so reduced or
terminated being referred to as the "Prepaid Amount"), the cost to the relevant
Purchaser of terminating or reducing such Tranche, which (a) for a CP Tranche
means any compensation payable in prepaying the related commercial paper or, if
not prepaid, any shortfall between the amount that will be available to
Amsterdam on the maturity date of the related commercial paper from reinvesting
the Prepaid Amount in Permitted Investments and the Face Amount of such
commercial paper and (b) for a Eurodollar Tranche will be determined based on
the difference between the LIBOR applicable to such Tranche and the LIBOR
applicable for a period equal to the remaining maturity of the Tranche on the
date the Prepaid Amount is received.
I-6
"Eligible Receivable" means, at any time, any Receivable:
(i) the Obligor of which (a) is a resident of, or organized under the
laws of, or with its chief executive office in, the USA; provided, however, that
(I) not more than 10% of Eligible Receivables at any time may consist of
Receivables due from an Obligor which is not a resident of, or organized under
the laws of, or with its chief executive office in, the USA (each, a "Foreign
Receivable") if the applicable Originator is the account party to a letter of
credit or letters of credit issued by a financial institution acceptable to the
Agent naming the Collection Agent (or a permitted sub-collection agent) as
beneficiary in a face amount not less than the aggregate invoiced amount of
Foreign Receivables of such Originator and in form and substance satisfactory to
the Agent, and (II) not more than 10% of Eligible Receivables at any time may
consist of Foreign Receivables not covered by clause (I) above if (x) the
applicable Obligor (1) is a resident of a country that is a member of the
Organization of Economic Cooperation and Development, and (2) has a long-term
senior unsecured credit rating of at least BBB- by S&P and Baa3 by Xxxxx'x and
(y) all payments of such Receivables are required to be made in US dollars into
a Lock-Box Account; (b) is not an Affiliate of any Crompton Entity; (c) is not a
government or a governmental subdivision or agency; (d) has not suffered a
Bankruptcy Event; (e) is a customer of the Originator in good standing; and (f)
is not the Obligor of Receivables 25% or more of which are Defaulted
Receivables;
(ii) which is stated to be due and payable within 90 days after the
invoice therefor; provided, however, that not more than 10% of Eligible
Receivables (other than Foreign Receivables) at any time may consist of
Receivables which are stated to be due and payable within 91 to 360 days after
invoice therefor;
(iii) which is not a Defaulted Receivable or a Charge-Off;
(iv) which is an "account" within the meaning of Section 9-102(a) of the
UCC of all applicable jurisdictions;
(v) which is denominated and payable only in Dollars in the USA and is
non-interest bearing; provided that a Receivable shall not be deemed to be
interest bearing solely as a result of the Seller's lawful imposition of an
interest or other charge on any Receivable that remains unpaid for some
specified period of time;
(vi) which arises under a contract that is in full force and effect and
constitutes the legal, valid and binding obligation of the related Obligor
enforceable against such Obligor in accordance with its terms subject to no
offset, counterclaim, defense or other Adverse Claim, and is not an executory
contract or unexpired lease within the meaning of Section 365 of the Bankruptcy
Code;
(vii) which arises under a contract that (a) contains an obligation to
pay a specified sum of money and is subject to no contingencies and (b) does not
contain a confidentiality provision that purports to restrict any Purchaser's
exercise of rights under this Agreement, including, without limitation, the
right to review such contract;
I-7
(viii) which does not, in whole or in part, contravene any law, rule or
regulation applicable thereto (including, without limitation, those relating to
usury, truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy); and
(ix) which satisfies all applicable requirements of the Credit and
Collection Policy and was generated in the ordinary course of each Originator's
business from the sale of goods or provision of services to a related Obligor
solely by each Originator.
"Eligible Receivables Balance" means, at any time, (a) the aggregate
outstanding principal balance of all Eligible Receivables less (b) an amount
equal to (1) the portion of the aggregate outstanding principal balance of
Eligible Receivables which exceed the Concentration Limit minus (2) the dollar
amounts of the Tax Liability Amount. The Eligible Receivables Balance for
Receivables and the Tax Liability Amount payable in currencies other than
Dollars shall be calculated in Dollars using the applicable Exchange Rate.
"Eurodollar Rate" means, for any Tranche Period for a Eurodollar
Tranche, the sum of (a) LIBOR for such Tranche Period divided by 1 minus the
"Reserve Requirement" plus (b) the amount specified in the Fee Letter plus (c)
during the continuance of any Financial Covenant Grace Period and on or after
the occurrence of a Termination Event, the amount specified in the Fee Letter;
where "Reserve Requirement" means, for any Tranche Period for a Eurodollar
Tranche, the maximum reserve requirement imposed during such Tranche Period on
"eurocurrency liabilities" as currently defined in Regulation D of the Board of
Governors of the Federal Reserve System.
"Exchange Agent" means the person appointed as exchange agent pursuant
to Section 3.10(a).
"Exchange Rate" means with respect to any foreign currency in which a
Receivable is payable the amount of such currency that would be required to
purchase a Dollar based on the foreign exchange market for such currency on the
date the Receivable is purchased as set forth on the Bloomberg Professional
Service Composite NY quote as of the close of business on the Purchase Date.
"Face Amount" means the face amount of any Amsterdam commercial paper
issued on a discount basis or, if not issued on a discount basis, the principal
amount of such note and interest scheduled to accrue thereon to its stated
maturity.
"Federal Funds Rate" means for any day the greater of (i) the average
rate per annum as determined by ABN AMRO at which overnight Federal funds are
offered to ABN AMRO for such day by major banks in the interbank market, and
(ii) if ABN AMRO is borrowing overnight funds from a Federal Reserve Bank that
day, the average rate per annum at which such overnight borrowings are made on
that day. Each determination of the Federal Funds Rate by ABN AMRO shall be
conclusive and binding on the Seller except in the case of manifest error.
I-8
"Fee Letter" means the letter agreement dated as of the date hereof
among the Seller, the Liquidity Providers, the Agent and Amsterdam.
"Financial Covenant Grace Period" means any period commencing on the
date on which a Potential Termination Event described in clause (m) of the
definition of Termination Event first occurs and ending on the date on which
such Potential Termination Event ceases to exist or has been waived.
"Funding Agreement" means any agreement or instrument executed by
Amsterdam and executed by or in favor of any Amsterdam Funding Source or
executed by any Amsterdam Funding Source at the request of Amsterdam.
"Funding Charges" means, for each day, the sum of (i) discount accrued
on Pooled Commercial Paper on such day, plus (ii) any and all accrued
commissions in respect of placement agents and commercial paper dealers in
respect of such Pooled Commercial Paper for such day, plus (iii) issuing and
paying agents' fees incurred on such Pooled Commercial Paper for such day, plus
(iv) other costs associated with funding small or odd-lot amounts with respect
to all Receivable Purchase Facilities which are funded by Pooled Commercial
Paper for such day, minus (v) any accrual of income net of expenses received on
such day from investment of collections received under all Receivable Purchase
Facilities funded with Pooled Commercial Paper, minus (vi) any payment received
on such day net of expenses in respect of Break Funding Costs related to the
prepayment of any Purchase Interests held by Amsterdam pursuant to the terms of
any Receivable Purchase Facilities funded substantially with Pooled Commercial
Paper.
"GAAP" means generally accepted accounting principles in the USA,
applied on a consistent basis.
"Governmental Authority" means any (a) Federal, state, municipal or
other governmental entity, board, bureau, agency or instrumentality, (b)
administrative or regulatory authority (including any central bank or similar
authority) or (c) court, judicial authority or arbitrator, in each case, whether
foreign or domestic.
"Incremental Purchase" is defined in Section 1.1(b).
"Initial Collection Agent" is defined in the first paragraph hereof.
"Instructing Group" means the Required Liquidity Providers, and, unless
the Amsterdam Termination Date has occurred and Amsterdam has no Investment,
Amsterdam.
"Intended Tax Characterization" is defined in Section 9.9.
I-9
"Interim Liquidation" means any time before the Liquidity Termination
Date during which no Reinvestment Purchases are made by any Purchaser, as
established pursuant to Section 1.2.
"Investment" means, for each Purchaser, (a) the sum of (i) all
Incremental Purchases by such Purchaser and (ii) the aggregate amount of any
payments or exchanges made by, or on behalf of, such Purchaser to any other
Purchaser under Article II minus (b) all Collections, amounts received from
other Purchasers under Article II, and other amounts received or exchanged and,
in each case, applied by the Agent or such Purchaser to reduce such Purchaser's
Investment. A Purchaser's Investment shall be restored to the extent any amounts
so received or exchanged and applied are rescinded or must be returned for any
reason.
"LIBOR" means, for any Tranche Period for a Eurodollar Tranche or other
time period, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred-thousandth of a percentage point) for deposits in Dollars for
a period equal to such Tranche Period or other period, which appears on Page
3750 of the Telerate Service (or any successor page or successor service that
displays the British Bankers' Association Interest Settlement Rates for Dollar
deposits) as of 11:00 a.m. (London, England time) two Business Days before the
commencement of such Tranche Period or other period. If for any Tranche Period
for a Eurodollar Tranche no such displayed rate is available (or, for any other
period, if such displayed rate is not available or the need to calculate LIBOR
is not notified to the Agent at least 3 Business Days before the commencement of
the period for which it is to be determined), the Agent shall determine such
rate based on the rates ABN AMRO is offered deposits of such duration in the
London interbank market.
"Limited Guaranty" means the Limited Guaranty, dated the date hereof,
from the Parent in favor of the Agent.
"Liquidation Period" means, for Amsterdam only, all times when
Amsterdam is not making Reinvestment Purchases pursuant to Section 1.1(d) and,
for all Purchasers, all times (x) during an Interim Liquidation and (y) on and
after the Liquidity Termination Date.
"Liquidity Providers" is defined in the first paragraph hereof.
"Liquidity Termination Date" means the earliest of (a) the date of the
occurrence of a Termination Event described in clause (e) of the definition of
Termination Event, (b) the date designated by the Agent to the Seller at any
time after the occurrence of any other Termination Event, (c) the Business Day
designated by the Seller with no less than five (5) Business Days prior notice
to the Agent and (d) August 15, 2007.
"Lock-Box" means each post office box or bank box listed on Exhibit F,
as revised pursuant to Section 5.1(i).
"Lock-Box Account" means each account maintained by the Collection
Agent at a Lock-Box Bank for the purpose of receiving or concentrating
Collections.
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"Lock-Box Agreement" means each agreement between the Collection Agent
and a Lock-Box Bank concerning a Lock-Box Account.
"Lock-Box Bank" means each bank listed on Exhibit F, as revised
pursuant to Section 5.1(i).
"Lock-Box Letter" means a letter in substantially the form of Exhibit G
(or otherwise acceptable to the Agent) from the Seller and the Collection Agent
to each Lock-Box Bank, acknowledged and accepted by such Lock-Box Bank and the
Agent.
"Loss Reserve" means, at any time, the product of (i) the greatest of
(a) 15.0%, (b) Delinquency Multiple times the highest three month rolling
average Delinquency Ratio (expressed as a decimal) as of the last day of each of
the last twelve calendar months and (c) Default Multiple times the highest three
month rolling average Default Ratio (expressed as a decimal) as of the last day
of each of the last twelve calendar months multiplied by (ii) the Eligible
Receivables Balance.
"Loss-to-Liquidation Ratio" means, for any period, the ratio of the
outstanding balance of Charge-Offs to the aggregate amount of Collections during
such period.
"Matured Aggregate Investment" means, at any time, the Matured Value of
Amsterdam's Investment plus the total Investments of all other Purchasers then
outstanding.
"Matured Value" means, of any Investment, the sum of such Investment
and all unpaid Discount, fees and other amounts scheduled to become due (whether
or not then due) on such Investment during all Tranche Periods to which any
portion of such Investment has been allocated.
"Maximum Incremental Purchase Amount" means, at any time, the lesser of
(a) the difference between the Purchase Limit and the Aggregate Investment then
outstanding and (b) the difference between the Aggregate Commitment and the
Matured Aggregate Investment then outstanding.
"Monthly Reporting Period" means, any period which is not a Weekly
Reporting Period or a Daily Reporting Period.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Obligor" means, for any Receivable, each Person obligated to pay such
Receivable and each guarantor of such obligation.
"Originators" means each of Crompton Sales Company, Inc., Xxxxx
Standard Corporation and Crompton Corporation.
"Parent" means Crompton Corporation, a Delaware corporation.
I-11
"Periodic Report" means, for any Reporting Date, (i) during any Monthly
Reporting Period, a report reflecting the information as of the close of
business of the Collection Agent for the immediately preceding calendar month,
containing the information described on Exhibit C-1 (with such modifications or
additional information as requested by the Agent or the Instructing Group), (ii)
during any Weekly Reporting Period, a report reflecting the information as of
the close of business of the Collection Agent for the immediately preceding
calendar week, containing the information described on Exhibit C-2 (with such
modifications or additional information as requested by the Agent or the
Instructing Group) and (iii) during any Daily Reporting Period, a report
reflecting the information as of the close of business of the Collection Agent
for the second preceding calendar day, containing the information described on
Exhibit C-3 (with such modifications or additional information as requested by
the Agent or the Instructing Group).
"Permitted Investments" means (a) evidences of indebtedness, maturing
within thirty (30) days after the date of purchase thereof, issued by, or
guaranteed by the full faith and credit of, the federal government of the USA,
(b) repurchase agreements with banking institutions or broker-dealers the
short-term unsecured obligations of which is rated at least "A-1" (or the
equivalent) by S&P and at least "P-1" (or the equivalent) by Moody's registered
under the Securities Exchange Act of 1934 which are fully secured by obligations
of the kind specified in clause (a), (c) money market funds (i) rated not lower
than the highest rating category from Moody's and "AAA m" or "AAAm-g," from S&P
or (ii) which are otherwise acceptable to the Rating Agencies or (d) commercial
paper issued by any corporation incorporated under the laws of the USA and rated
at least "A-1" (or the equivalent) by S&P and at least "P-1" (or the equivalent)
by Moody's.
"Person" means an individual, partnership, corporation, association,
joint venture, Governmental Authority or other entity of any kind.
"Pool Funded Purchase Interest" means each investment or loan of
Amsterdam under a Receivables Purchase Facility funded with Pooled Commercial
Paper.
"Pooled Allocation" means, for each Pool Funded Purchase Interest, an
amount each day equal to the product of (i) the Pooled Percentage Share of such
Purchase Interest on such day multiplied by (ii) the aggregate amount of Funding
Charges for such day.
"Pooled Commercial Paper" means commercial paper notes of Amsterdam
except (A) Allocated Commercial Paper, and (B) Specially Pooled Paper.
"Pooled Percentage Share" means, for each Pool Funded Purchase
Interest, a fraction (expressed as a percentage) the numerator of which is equal
to the Investment associated with such Pool Funded Purchase Interest and the
denominator of which is equal to the aggregate amount of all outstanding
investment (or comparable terms used in any Receivable Purchase Facility) held
by Amsterdam which is funded substantially with Pooled Commercial Paper.
"Potential Termination Event" means any Termination Event or any event
or condition that with the lapse of time or giving of notice, or both, would
constitute a Termination Event.
I-12
"Prime Rate" means, for any period, the daily average during such
period of (a) the greater of (i) the floating commercial loan rate per annum of
ABN AMRO (which rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer by ABN AMRO) announced from
time to time as its prime rate or equivalent for Dollar loans in the USA,
changing as and when said rate changes and (ii) the Federal Funds Rate plus
0.75% plus (b) on or after the occurrence of a Termination Event, the amount set
forth in the Fee Letter.
"Purchase" is defined in Section 1.1(a).
"Purchase Agreement" means the Receivables Purchase Agreement dated as
of the date hereof among the Seller and each Originator.
"Purchase Amount" is defined in Section 1.1(c).
"Purchase Date" is defined in Section 1.1(c).
"Purchase Interest" means, for a Purchaser, the percentage ownership
interest in the Receivables and Collections held by such Purchaser, calculated
when and as described in Section 1.1(a); provided, however, that (except for
purposes of computing a Purchase Interest or the Sold Interest in Section 1.5 or
1.7) at any time the Sold Interest would otherwise exceed 100.0% each Purchaser
then holding any Investment shall have its Purchase Interest reduced by
multiplying such Purchase Interest by a fraction equal to 100.0% divided by the
Sold Interest otherwise then in effect, so that the Sold Interest is thereby
reduced to 100.0%.
"Purchase Limit" means $125,000,000.
"Purchasers" means the Liquidity Providers and Amsterdam.
"Put" is defined in Section 2.l(a).
"Ratable Share" is defined in the Transfer Agreement.
"Rating Agency" means Moody's, S&P and any other rating agency
Amsterdam chooses to rate its commercial paper notes.
"Ratings" means the ratings by the Rating Agencies of the indebtedness
for borrowed money of Amsterdam.
"Receivable" means each obligation of an Obligor to pay for merchandise
sold or services rendered by any Originator and includes such Originator's
rights to payment of any interest or finance charges and in the merchandise
(including returned goods) and contracts relating to such Receivable, all
security interests, guaranties and property securing or supporting payment of
such Receivable, all Records and all proceeds of the foregoing. During any
Interim Liquidation and on and after the Liquidity Termination Date, the term
"Receivable" shall only include receivables existing on the date such Interim
Liquidation commenced or Liquidity Termination Date occurred, as applicable.
Deemed Collections shall reduce the outstanding balance of Receivables
hereunder, so that any Receivable that has its outstanding balance deemed
collected shall cease to be a Receivable hereunder after (x) the Collection
Agent receives payment of such Deemed Collections under Section 1.5(b) or (y) if
such Deemed Collection is received before the Liquidity Termination Date, an
adjustment to the Sold Interest permitted by Section 1.5(c) is made.
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"Receivable Purchase Facility" means any receivables purchase
agreement, loan agreement or other similar contractual arrangement to which
Amsterdam is a party relating to the transfer, purchase or financing of
receivables or other assets.
"Records" means, for any Receivable, all contracts, books, records and
other documents or information (including computer programs, tapes, disks,
software and related property and rights) relating to such Receivable or the
related Obligor.
"Reinvestment Purchase" is defined in Section 1.1(b).
"Reporting Date" means, (i) during any Monthly Reporting Period, the
20th day of each calendar month, (ii) during any Weekly Reporting Period,
Tuesday of each calendar week and (iii) during any Daily Reporting Period, each
calendar day.
"Reporting Period" means, a Daily Reporting Period, Weekly Reporting
Period and Monthly Reporting Period, as applicable.
"Required Liquidity Providers" means Liquidity Providers having
Liquidity Provider Commitments in excess of 66-2/3% of the Commitment of all
Liquidity Providers.
"Reserve Percentage" means, at any time, the quotient obtained by
dividing (a) the Aggregate Reserve by (b) the Eligible Receivables Balance.
"Seller" is defined in the first paragraph hereof.
"Seller Account" means the Seller's account number 000-0-000000 at The
Chase Manhattan Bank, New York, New York or such other account designated by the
Seller to the Agent with at least ten (10) days prior notice.
"Settlement Date" means the 20th day of each calendar month.
"Sold Interest" is defined in Section 1.1(a).
"Special Transaction Subaccount" means the special transaction
subaccount established for this Agreement pursuant to Amsterdam's depositary
agreement.
"Specially Pooled Paper" means the aggregate of all commercial paper
notes of Amsterdam issued in connection with receivables purchase facilities
designated from time to time by the Agent (in its sole discretion). Specially
Pooled Paper will not include Pooled Commercial Paper or Allocated Commercial
Paper at any time.
I-14
"S&P" means Standard & Poor's Ratings Group.
"Subordinated Notes" means each buyer note issued by the Seller to the
applicable Originator under the Purchase Agreement.
"Subsidiary" means any Person of which at least a majority of the
voting stock (or equivalent equity interests) is owned or controlled by the
Seller or any Crompton Entity or by one or more other Subsidiaries of the Seller
or such Crompton Entity. The Subsidiaries of the Parent on the date hereof are
listed on Exhibit E.
"Tax Liability Amount" means at any date the amount carried in the
Originator's records representing the obligation to pay or reimburse all sales
taxes, value added taxes or similar taxes payable with respect to Eligible
Receivables and any interest, penalties or other charges with respect thereto.
"Taxes" means all taxes, charges, fees, levies or other assessments
(including income, gross receipts, profits, withholding, excise, property,
sales, use, license, occupation and franchise taxes and including any related
interest, penalties or other additions) imposed by any jurisdiction or taxing
authority (whether foreign or domestic).
"Termination Date" means (a) for Amsterdam, the Amsterdam Termination
Date and (b) for the Liquidity Providers, the Liquidity Termination Date.
"Termination Event" means the occurrence of any one or more of the
following:
(a) any representation, warranty, certification or statement made by
the Seller or any Crompton Entity in, or pursuant to, any Transaction Document
proves to have been incorrect in any material respect when made; or
(b) the Collection Agent, any Crompton Entity or the Seller fails to
make any payment or other transfer of funds hereunder when due (including any
payments under Section 1.5(a)); or
(c) the Seller fails to observe or perform any covenant or agreement
contained in Sections 3.3, 5.1(b), 5.1(e), 5.1(g), 5.1(i), or 5.1(j) of this
Agreement or any Originator fails to perform any covenant or agreement in
Sections 6.1(d), 6.1(f), 6.1(i), 6.1(j), 6.1(k), 6.2(b) or 6.3 of each Purchase
Agreement; or
(d) the Seller or the Collection Agent (or any sub-collection agent)
fails to observe or perform any other term, covenant or agreement under any
Transaction Document, and such failure remains unremedied for thirty days; or
(e) the Seller, any Originator or any Subsidiary suffers a Bankruptcy
Event; or
I-15
(f) the average of the Delinquency Ratios as of the end of each of the
most recent three calendar months exceeds 12.0%, the average of the Default
Ratios as of the end of each of the most recent three calendar months exceeds
15.0%, the Dilution Ratio at the end of any calendar month measured for the
three month calendar period then ending exceeds 5.0% or the Loss-to-Liquidation
Ratio at the end of any calendar month measured for the three month calendar
period then ending exceeds 1.0%; or
(g) (i) the Seller, any Crompton Entity or any Affiliate, directly or
indirectly, disaffirms or contests the validity or enforceability of any
Transaction Document or (ii) any Transaction Document fails to be the
enforceable obligation of the Seller or any Affiliate party thereto; or
(h) the Seller or any Subsidiary (A) generally does not pay its debts
as such debts become due or admits in writing its inability to pay its debts
generally or (B) fails to pay any of its indebtedness (except in aggregate
principal amount of less than $1,000,000 or indebtedness under the Crompton
Credit Agreement) or defaults in the performance of any provision of any
agreement under which such indebtedness was created or is governed and such
default permits such indebtedness to be declared due and payable or to be
required to be prepaid before the scheduled maturity thereof; or
(i) any event occurs or condition exists which constitutes an Event of
Default (as defined in the Crompton Credit Agreement) under the Crompton Credit
Agreement; provided, however, that such Event of Default under the Crompton
Credit Agreement shall not constitute a Termination Event hereunder until the
earlier to occur of (x) the 91st day after the date on which such Event of
Default arises under the Crompton Credit Agreement so long as such Event of
Default is then continuing and (y) the acceleration by the Lenders thereunder of
the obligations under the Crompton Credit Agreement ; or
(j) the average of the Turnover Rates for each of the most recent three
calendar months exceeds 90 days; or
(k) a Collection Agent Replacement Event has occurred and is continuing
with respect to the Initial Collection Agent; or
(l) the Parent shall fail to own and control, directly or indirectly,
(i) 100.0% of the outstanding voting stock of the Seller and each Originator; or
(m) the Parent shall fail to comply with any covenant set forth in
Sections 9.08 and 9.09 of the Crompton Credit Agreement (as such Crompton Credit
Agreement is in effect as of August 16, 2004, without regard to any subsequent
amendment, supplement, waiver or termination thereof or any defined terms
contained therein, in each case unless consented to by the Agent at the
direction of the Instructing Group); provided, however, that the Parent's
failure to comply with such Sections of the Crompton Credit Agreement shall not
constitute a Termination Event hereunder until the earliest to occur of (x) the
91st day after the date on which such failure to comply constitutes an Event of
Default under the Crompton Credit Agreement so long as such Event of Default is
then continuing and (y) the acceleration by the Lenders thereunder of the
obligations under the Crompton Credit Agreement.
I-16
Notwithstanding the foregoing, a failure of a representation or warranty or
breach of any covenant described in clause (a), (c) or (d) above related to a
Receivable shall not constitute a Termination Event if the Seller has been
deemed to have collected such Receivable pursuant to Section 1.5(b) or, before
the Liquidity Termination Date, has adjusted the Sold Interest as provided in
Section 1.5(c) so that such Receivable is no longer considered to be
outstanding.
"Tranche" means a portion of the Investment of Amsterdam or of the
Committed Purchasers allocated to a Tranche Period pursuant to Section 1.3. A
Tranche is a (i) CP Tranche, (ii) Eurodollar Tranche or (iii) Prime Tranche
depending whether Discount accrues during its Tranche Period based on a (i) CP
Rate, (ii) Eurodollar Rate, or (iii) Prime Rate.
"Tranche Period" means a period of days ending on a Business Day
selected pursuant to Section 1.3, which (i) for a CP Tranche shall not exceed
270 days, (ii) for a LIBOR Tranche shall not exceed 180 days, and (iii) for a
Prime Tranche shall not be less than 2 days and shall not exceed 30 days.
"Transaction Documents" means this Agreement, the Fee Letter, the
Limited Guaranty, the Purchase Agreements, the Subordinated Notes and all other
documents, instruments and agreements executed or furnished in connection
herewith and therewith.
"Transfer Agreement" means the Amsterdam Transfer Agreement dated the
date hereof between Amsterdam, ABN AMRO Bank N.V., in its capacity as
Amsterdam's Agent and a Liquidity Provider and the other Persons who become
Liquidity Providers hereunder.
"Transfer Supplement" is defined in Section 9.8.
"Turnover Rate" means, for any period for which it is calculated, the
product, expressed in days, of (A) (1) the outstanding balance of all
Receivables at the beginning of such period divided by (2) the average daily
Collections (other than Deemed Collections) during such period multiplied by (B)
30.
"UCC" means, for any state, the Uniform Commercial Code as in effect in
such state.
"USA" means the United States of America (including all states and
political subdivisions thereof).
"Unused Aggregate Commitment" means, at any time, the difference
between the Aggregate Commitment then in effect and the outstanding Matured
Aggregate Investment.
"Unused Commitment" means, for any Committed Purchaser at any time, the
difference between its Commitment and its Investment then outstanding.
"Weekly Reporting Period" means, any period during which the senior
unsecured long-term debt of the Parent is rated less than BB+ by S&P or Ba1 by
Moody's (or either such rating is suspended or withdrawn) and which is not a
Daily Reporting Period.
I-17
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms. Unless otherwise inconsistent
with the terms of this Agreement, all accounting terms used herein shall be
interpreted, and all accounting determinations hereunder shall be made, in
accordance with GAAP. Amounts to be calculated hereunder shall be continuously
recalculated at the time any information relevant to such calculation changes.
I-18
SCHEDULE II
LIQUIDITY PROVIDERS AND COMMITMENTS OF COMMITTED PURCHASERS
Name of Liquidity Provider Commitment
-------------------------- ----------
ABN AMRO Bank N.V. $127,500,000
EXHIBIT A
TO
SECOND AMENDED AND RESTATED RECEIVABLES SALE AGREEMENT
FORM OF INCREMENTAL PURCHASE REQUEST
______________, 200_
ABN AMRO Bank N.V., as Agent
Asset Securitization, Structured Finance
Suite 725
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attn: Purchaser Agent-Amsterdam
Re: Second Amended and Restated Receivables Sale Agreement dated as of
August 16, 2004 (as amended or restated from time to time, the "Sale
Agreement") among Crompton & Xxxxxxx Receivables Corporation, as Seller,
Crompton Corporation, as Initial Collection Agent,
ABN AMRO Bank N.V., as Agent,
and the Purchasers thereunder
Ladies and Gentlemen:
The undersigned Seller under the above-referenced Sale Agreement hereby
confirms its has requested an Incremental Purchase of $___________ by Amsterdam
under the Sale Agreement. [IN THE EVENT AMSTERDAM IS UNABLE OR UNWILLING TO MAKE
THE REQUESTED INCREMENTAL PURCHASE, THE SELLER HEREBY REQUESTS AN INCREMENTAL
PURCHASE OF $___________ BY THE COMMITTED PURCHASERS UNDER THE SALE AGREEMENT AT
THE [EURODOLLAR RATE WITH A TRANCHE PERIOD OF _____ MONTHS.] [PRIME RATE]].
Attached hereto as Schedule I is information relating to the proposed
Incremental Purchase required by the Sale Agreement. If on the date of this
Incremental Purchase Request ("Notice"), an Interim Liquidation is in effect,
this Notice revokes our request for such Interim Liquidation so that
Reinvestment Purchases shall immediately commence in accordance with Section
1.1(d) of the Sale Agreement.
The Seller hereby certifies that both before and after giving effect to
[EACH OF] the proposed Incremental Purchase[S] contemplated hereby and the use
of the proceeds therefrom, all of the requirements of Section 7.2 of the Sale
Agreement have been satisfied.
Very truly yours,
CROMPTON & XXXXXXX RECEIVABLES
CORPORATION
By
Title____________________________________
A-2
SCHEDULE I
TO
INCREMENTAL PURCHASE REQUESTS
SUMMARY OF INFORMATION RELATING TO PROPOSED SALE(S)
1. Dates, Amounts, Purchaser(s), Proposed Tranche Periods
A1 Date of Notice _________
A2 Measurement Date (the last
Business Day of the preceding
calendar month or the preceding
Business Day, as applicable) _________
A3 Proposed Purchase Dates _________ _________ _________ _________
(each of which is a
Business Day)
A4 Respective Proposed
Incremental Purchase on
each such Purchase Date $_________ $_________ $_________ $_________
(each Incremental (A4A) (A4B) (A4C) (A4D)
Purchase must be in a
minimum amount of
$1,000,000 and multiples
thereof, or, if less, an
amount equal to the
Maximum Incremental
Purchase Amount)
A5 Proposed Allocation
among Purchasers
Amsterdam $_________ $_________ $_________ $_________
Liquidity
Providers $_________ $_________ $_________ $_________
A6 Tranche Period
and, for Committed
Purchasers, Tranche Rate(s)
Starting Date _________ _________ _________ _________
Ending Date _________ _________ _________ _________
Number of Days _________ _________ _________ _________
Prime or Eurodollar
(for Committed
Purchasers only) _________ _________ _________ _________
A-3
Each proposed Purchase Date must be a Business Day and must occur no
later than two weeks after the Measurement Date set forth above. The
choice of Measurement Date is a risk undertaken by the Seller. If a
selected Measurement Date is not the applicable Purchase Date, the
Seller's choice and disclosure of such date shall not in any manner
diminish or waive the obligation of the Seller to assure the Purchasers
that, after giving effect to the proposed Purchase, the actual Sold
Interest as of the date of such proposed Purchase does not exceed
100.0%.
A-4
EXHIBIT B
TO
SECOND AMENDED AND RESTATED RECEIVABLES SALE AGREEMENT
FORM OF NOTIFICATION OF ASSIGNMENT TO AMSTERDAM
FROM THE COMMITTED PURCHASERS
______________, 200__
Crompton & Xxxxxxx
Receivables Corporation
_________________________
_________________________
ABN AMRO Bank N.V., as Agent
Asset Securitization, Structured Finance
Suite 725
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attn: Liquidity-Amsterdam
[INSERT NAME AND ADDRESS OF EACH
LIQUIDITY PROVIDER]
Re: Second Amended and Restated Receivables Sale Agreement
dated as of August 16, 2004
(as amended or restated from time to time, the "Sale Agreement")
among Crompton & Xxxxxxx Receivables Corporation, as Seller,
Crompton Corporation, as Initial Collection Agent,
ABN AMRO Bank N.V., as Agent, and the Purchasers thereunder
Ladies and Gentlemen:
The Agent under the above-referenced Sale Agreement hereby notifies
each of you that Amsterdam has notified the Agent pursuant to Section 2.2 of the
Sale Agreement that it will purchase from the Committed Purchasers on
____________ (the "Purchase Date") that portion of the Committed Purchasers'
Investments identified on Schedule I hereto (the "Assigned Interest"). As
further provided in Section 2.2 of the Sale Agreement, upon payment by Amsterdam
to the Agent of the purchase price of such Investments described on Schedule I
hereto, effective as of the Purchase Date the assignment by the Committed
Purchasers to Amsterdam of the Assigned Interest shall be complete and all
payments thereon under the Sale Agreement shall be made to Amsterdam.
In accordance with the Sale Agreement, each Committed Purchaser's
acceptance of the portion purchase price payable to it described on Schedule I
hereto constitutes its representation and warranty that it is the legal and
beneficial owner of the portion of the Assigned Interest related to its Purchase
Interest identified on Schedule I free and clear of any Adverse Claim created or
granted by it and that on the Purchase Date it is not subject to a Bankruptcy
Event.
Very truly yours,
ABN AMRO BANK N.V., as Agent
By
Name_____________________________________
Title____________________________________
By
Name_____________________________________
Title____________________________________
B-2
SCHEDULE I
TO
NOTIFICATION OF ASSIGNMENT
Dated ___________, 200__
I. Amount of Committed Purchaser Investment Assigned: $____________
II. Information for each Committed Purchaser.
PURCHASER PURCHASE INTEREST PURCHASE PRICE*
--------- ----------------- ---------------
----------------- ----------------------- ---------------
----------------- ----------------------- ---------------
----------------- ----------------------- ---------------
----------------- ----------------------- ---------------
----------------- ----------------------- ---------------
III. Information for Seller.
Aggregate amounts of purchase price in excess of amount of Investment
assigned: $_______________.
----------
* calculated in accordance with Section 2.2.
B-3
EXHIBIT C-1
FORM OF PERIODIC REPORT
EXHIBIT C-2
FORM OF WEEKLY REPORT
EXHIBIT C-3
FORM OF DAILY REPORT
EXHIBIT D
ADDRESSES AND NAMES OF SELLER AND ORIGINATORS
1. Locations. (a) The chief executive office of the Seller and each
Originator are located at the following address:
Crompton & Xxxxxxx Receivables Corporation
Xxxxxx Road
Middlebury, Connecticut 06749
Crompton Corporation
Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Xxxxx Standard Corporation
0 Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Crompton Sales Company, Inc.
Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
No such address was different at any time since July 1, 2001
(b) The following are all the locations where the Seller and each
Originator directly or through its agents maintain any Records:
Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
World Headquarters
Xxxxxx Road
Middlebury, Connecticut 06749
2. Names. The following is a list of all names (including trade names
or similar appellations) used by the Seller and each Originator or any of its
divisions or other business units:
None.
3. Jurisdiction of Organization and Organizational Identification
Number
Crompton & Xxxxxxx Receivables Corporation 2971181
Delaware Corporation
Crompton Corporation 3046078
Delaware Corporation
Xxxxx Standard Corporation 2448527
Delaware Corporation
Crompton Sales Company, Inc. 3230776
Delaware Corporation
D-2
EXHIBIT E
SUBSIDIARIES OF CROMPTON CORPORATION
AUGUST 1, 2004
Percentage of
Voting
Securities
Owned Directly
or
Indirectly by State or
Crompton Country of
Corporation Organization
0000-0000 Xxxxxx Inc. 100.0 Canada
Assured Insurance Company 100.0 Vermont
Baxenden Chemicals Limited 53.5 England
Baxenden Scandinavia A.S. 53.5 Denmark
Certis Europe B.V. 15.0 The Netherlands
CK Witco Specialties Thailand Limited 100.0 Thailand
CNK Chemical Realty Corporation 100.0 Pennsylvania
Crompton & Xxxxxxx of Canada Limited 100.0 Canada
Crompton & Xxxxxxx Receivables Corporation 100.0 Delaware
Crompton (Uniroyal Chemical) Registrations Limited 100.0 England
Crompton Agribusiness Pty. Limited 100.0 Australia
Crompton B.V. 100.0 The Netherlands
Crompton Chemical (Pty) Limited 100.0 South Africa
Crompton Chemical S.r.l. 100.0 Italy
Crompton Chemicals B.V. 100.0 The Netherlands
Crompton Co./Cie 100.0 Canada
Crompton Colors Incorporated 100.0 Delaware
Crompton Corporation Limitada 100.0 Chile
Crompton Corporation S.A. de C.V. 100.0 Mexico
Crompton de Colombia Limitada 100.0 Colombia
Crompton Espana S.L. 100.0 Spain
Crompton Europe B.V. 100.0 The Netherlands
Crompton Europe Financial Services Company 100.0 Delaware
Crompton Europe Limited 100.0 Scotland
Crompton European Holdings B.V. 100.0 The Netherlands
Crompton Financial Holdings 100.0 Ireland
Crompton GmbH 100.0 Germany
Crompton Grand Banks Inc. 100.0 Canada
Crompton Holding Corporation 100.0 Delaware
Crompton Holding S.A de C.V. 100.0 Mexico
Crompton Holdings B.V. 100.0 The Netherlands
Crompton Holdings GmbH 100.0 Germany
Crompton Inc. 100.0 Korea
Crompton International Corporation 100.0 New Jersey
Crompton International Sales Corporation 100.0 Barbados
Crompton Investments S.A.S. 100.0 France
Crompton Limited 100.0 Japan
Crompton Limitada 100.0 Brazil
Crompton LLC 100.0 Delaware
Xxxxxxxx Xxxxxxxx, Inc. 100.0 Louisiana
Crompton N.V. 100.0 Belgium
Crompton Netherlands B.V. 100.0 The Netherlands
Crompton Overseas B.V. 100.0 The Netherlands
Crompton Quimica S.A.C.I 100.0 Argentina
Xxxxxxxx X.X. 100.0 Switzerland
Crompton S.A.S. 100.0 France
Crompton Sales Company, Inc. 100.0 Delaware
Crompton Services B.V.B.A. 100.0 Belgium
Crompton Servicios S.A. de C.V. 100.0 Mexico
Crompton Specialties Asia Pacific Pte. Limited 100.0 Singapore
Crompton Specialties GmbH 100.0 Germany
Crompton Specialties Holding Company Limited 100.0 China-Hong Kong
Crompton Specialties Limited 100.0 China-Hong Kong
Crompton Specialties Limited 100.0 Taiwan
Crompton Specialties Limited 92.0 Thailand
Crompton Specialties Nanjing Company Limited 100.0 China-PRC
Crompton Specialties Pte. Limited 100.0 Singapore
Crompton Specialties Pty. Limited 100.0 Australia
Crompton Specialties S.A. 100.0 Ecuador
Crompton Specialties Sdn. Bhd. 100.0 Malaysia
Crompton Specialties Shanghai Company Limited 100.0 China-PRC
Crompton Technology B.V. 100.0 The Netherlands
Crompton Vinyl Additives GmbH 100.0 Germany
Crompton, Inc. 100.0 Philippines
Crompton-CNCCC Danyang Chemical Company Limited 85.0 China-PRC
X-X Xxxxxxx Limited 100.0 England
Xxxxx-Standard (Deutschland) GmbH 100.0 Germany
Xxxxx-Standard Corporation 100.0 Delaware
Xxxxx-Standard France S.A.R.L. 100.0 France
Xxxxx-Standard GmbH 100.0 Germany
Xxxxx-Standard Limited 100.0 England
Enenco, Incorporated 50.0 New York
Fasting Jonk N.V. 100.0 The Netherlands
Firma W/K Witco EPA 50.0 The Netherlands
GT Seed International Company 100.0 Texas
GT Seed Treatment, Inc. 100.0 Minnesota
Handelsmaatschappij Camphina N.V. 100.0 The Netherlands
Unimers India Limited 1.54 India
Isofoam Limited 53.5 England
Jonk B.V. 100.0 The Netherlands
Kem Manufacturing Corporation 100.0 Xxxxxxx
Xxxxx Kaarsen Fabriek N.V. 100.0 The Netherlands
Monochem, Inc. 100.0 Louisiana
Nanjing Xxxxxxxx Xxxxxxxx Organosilicon Specialties Co., Ltd. 85.0 China-PRC
Naugatuck Treatment Company 100.0 Connecticut
Nerap Expeditie B.V. 100.0 The Netherlands
NPC Services, Inc. 12.75 Louisiana
PT Crompton Indonesia 100.0 Indonesia
Rubicon LLC 50.0 Utah
Unicorb Limited 100.0 England
Uniroyal Chemical Company, Inc. 100.0 Delaware
Uniroyal Chemical Company, Inc. 100.0 New Jersey
Uniroyal Chemical Company Limited 100.0 Bahamas
Uniroyal Chemical Company Limited (Delaware) 100.0 Delaware
Uniroyal Chemical Export Limited 100.0 Delaware
Uniroyal Chemical Leasing Company, Inc. 100.0 Delaware
Uniroyal Chemical Mexico S.A. de C.V. 100.0 Mexico
Uniroyal Chemical S.A 100.0 Spain
Uniroyal Chemical S.A.R.L. 100.0 Switzerland
Uniroyal Chemical Taiwan Limited 80.0 Taiwan
Xxxxx City Road LLC 100.0 Louisiana
Witco Corporation UK Limited 100.0 England
Witco Europe Investment Partners 100.0 Delaware
Witco Investment Holdings B.V. 100.0 The Netherlands
Witco Investments B.V. 100.0 The Netherlands
Witco Ireland Investment Company Limited 100.0 Ireland
Witco Polymers and Resins B.V. 100.0 The Netherlands
Witco Warmtekracht B.V. 100.0 The Netherlands
E-2
EXHIBIT F
LOCK BOXES AND LOCK-BOX BANKS
BANK LOCK-BOX NUMBER / ACCOUNT NAME COLLECTION ACCOUNT
Citibank 7247-8429 and 2049 4049-8376
4055-5094
Fleet Bank 30586 058-8001
Mellon Bank, N.A. 010-642 005-3575
JPMorgan Chase Bank Electronic Receipts Account 000-000-0000
EXHIBIT G
SECOND AMENDED AND RESTATED TO RECEIVABLES SALE AGREEMENT
FORM OF LOCK BOX LETTER
[Name of Lock Box Bank]
Ladies and Gentlemen:
Reference is made to the lock-box numbers _______________ in __________
and the associated the lock-box demand deposit account number ____________
maintained with you (such lock-boxes and associated lock-box demand deposit
account, collectively, the "Accounts"), each in the name of [NAME OF ORIGINATOR]
("[___]"). [___] hereby confirms it has sold all Receivables (as defined below)
to Crompton & Xxxxxxx Receivables Corporation (the "Seller").
In connection with the Second Amended and Restated Receivables Sale
Agreement, dated as of August 16, 2004 (as amended, supplemented or otherwise
modified from time to time, the "Receivables Sale Agreement"), among the Seller,
Amsterdam Funding Corporation ("Amsterdam"), the financial institutions from
time to time party thereto (collectively, the "Liquidity Providers") and ABN
AMRO Bank N.V., as agent (the "Agent") for Amsterdam and the Liquidity Providers
(collectively, the "Purchasers"), the Seller has assigned to the Agent for the
benefit of the Purchasers an undivided percentage interest in the accounts,
chattel paper, instruments or general intangibles (collectively, the
"Receivables") under which payments are or may hereafter be made to the
Accounts, and has granted to the Agent for the benefit of the Purchasers a
security interest in its retained interest in such Receivables. As is the
customary practice in this type of transaction, we hereby request that you
execute this letter agreement. All references herein to "we" and "us" refer to
[_____] and the Seller, jointly and severally. Your execution hereof is a
condition precedent to our continued maintenance of the Accounts with you.
We hereby transfer exclusive dominion and control of the Accounts to
the Agent, subject only to the condition subsequent that the Agent shall have
given you notice that a "Termination Event" has occurred and is continuing under
the Receivables Sale Agreement and of its election to assume such dominion and
control, which notice shall be in substantially the form attached hereto as
Annex A (the "Agent's Notice").
At all times prior to the receipt of the Agent's Notice described
above, all payments to be made by you out of, or in connection with the
Accounts, are to be made in accordance with the instructions of the Seller or
its agent.
We hereby irrevocably instruct you, at all times from and after the
date of your receipt of the Agent's Notice as described above, to make all
payments to be made by you out of, or in connection with, the Accounts directly
to the Agent, at its address set forth below its signature hereto or as the
Agent otherwise notifies you, or otherwise in accordance with the instructions
of the Agent.
We also hereby notify you that, at all times from and after the date of
your receipt of the Agent's Notice as described above, the Agent shall be
irrevocably entitled to exercise in our place and stead any and all rights in
connection with the Accounts, including, without limitation, (a) the right to
specify when payments are to be made out of, or in connection with, the Accounts
and (b) the right to require preparation of duplicate monthly bank statements on
the Accounts for the Agent's audit purposes and mailing of such statements
directly to an address specified by the Agent. At all times from and after the
date of your receipt of the Agent's Notice, neither we nor any of our affiliates
shall be given any access to the Accounts.
The Agent's Notice may be personally served or sent by telex, facsimile
or U.S. mail, certified return receipt requested, to the address, telex or
facsimile number set forth under your signature to this letter agreement (or to
such other address, telex or facsimile number as to which you shall notify the
Agent in writing). If the Agent's Notice is given by telex or facsimile, it will
be deemed to have been received when the Agent's Notice is sent and the
answerback is received (in the case of telex) or receipt is confirmed by
telephone or other electronic means (in the case of facsimile). All other
notices will be deemed to have been received when actually received or, in the
case of personal delivery, delivered.
By executing this letter agreement, you acknowledge the existence of
the Agent's right to dominion and control of the Accounts and its ownership of
and security interest in the amounts from time to time on deposit therein and
agree that from the date hereof the Accounts shall be maintained by you for the
benefit of, and amounts from time to time therein held by you as agent for, the
Agent on the terms provided herein. The Accounts are to be entitled "Crompton &
Xxxxxxx Receivables Corporation and ABN AMRO Bank N.V., as Agent for the
Purchasers" with the subline ["NAME OF ORIGINATOR"]. Except as otherwise
provided in this letter agreement, payments to the Accounts are to be processed
in accordance with the standard procedures currently in effect. All service
charges and fees in connection with the Accounts shall continue to be payable by
us under the arrangements currently in effect.
By executing this letter agreement, you (a) irrevocably waive and agree
not to assert, claim or endeavor to exercise, (b) irrevocably bar and estop
yourself from asserting, claiming or exercising and (c) acknowledge that you
have not heretofore received a notice, writ, order or other form of legal
process from any other party asserting, claiming or exercising, any right of
set-off, banker's lien or other purported form of claim with respect to the
accounts or any funds from time to time therein. Except for your right to
payment of your service charge and fees and to make deductions for returned
items, you shall have no rights in the Accounts or funds therein, except
deductions for service charges, fees and returned or misplaced items. To the
extent you may ever have any additional rights, you hereby expressly subordinate
all such rights to all rights of the Agent.
G-2
You may terminate this letter agreement by cancelling the Accounts
maintained with you, which cancellation and termination shall become effective
only upon thirty (30) days prior written notice thereof from you to the Agent in
the absence of fraud or abuse. Incoming mail addressed to the Accounts
(including, without limitation, any direct funds transfer to the Accounts)
received after such cancellation shall be forwarded in accordance with the
Agent's instructions. This letter agreement may also be terminated upon written
notice to you by the Agent stating that the Receivables Sale Agreement is no
longer in effect. Except as otherwise provided in this paragraph, this letter
agreement may not be terminated without the prior written consent of the Agent.
This letter agreement contains the entire agreement between the parties
with respect to the subject matter hereof, and may not be altered, modified or
amended in any respect, nor may any right, power or privilege of any party
hereunder be waived or released or discharged, except upon execution by you, us
and the Agent of a written instrument so providing. The terms and conditions of
any agreement between us and you (a "Lock-Box Service Agreement") (whether now
existing or executed hereafter) with respect to the lock-box arrangements, to
the extent not inconsistent with this letter agreement, will remain in effect
between you and us. In the event that any provision in this letter agreement is
in conflict with, or inconsistent with, any provision of any such Lock-Box
Service Agreement, this letter agreement will exclusively govern and control.
Each party agrees to take all actions reasonably requested by any other party to
carry out the purposes of this letter agreement or to preserve and protect the
rights of each party hereunder.
[___] agrees to indemnify, defend and hold harmless you and your
affiliates, directors, officers, employees, agents, successors and assigns
(each, an "Indemnitee") from and against any and all liabilities, losses,
claims, damages, demands, costs and expenses of every kind (including but not
limited to costs incurred as a result of items being deposited in the Account
and being unpaid for any reason, reasonable attorney's fees and the reasonable
charges of your in-house counsel) incurred or sustained by any Indemnitee
arising out of your performance of the services contemplated by this Lock-Box
Letter, except to the extent such liabilities, losses, claims, damages, demands,
costs and expenses are the direct result of your gross negligence or willful
misconduct. The provisions of this paragraph shall survive the termination of
this Lock-Box Letter.
In the event [___] becomes subject to a voluntary or involuntary
proceeding under the United States Bankruptcy Code, or if you are otherwise
served with legal process which you in good faith believe affects funds in the
Account you may suspend disbursements from the Account otherwise required by the
terms hereof until such time as you receive an appropriate court order or other
assurances satisfactory to you establishing that the funds may continue to be
disbursed according to the instructions contained in this Lock-Box Letter.
THIS LETTER AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER WILL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. This letter agreement may be executed in any
number of counterparts and all of such counterparts taken together will be
deemed to constitute one and the same instrument.
G-3
Please indicate your agreement to the terms of this letter agreement by
signing in the space provided below. This letter agreement will become effective
immediately upon execution of a counterpart of this letter agreement by all
parties hereto.
Very truly yours,
[NAME OF ORIGINATOR]
By:______________________________________
Title:___________________________________
CROMPTON & XXXXXXX RECEIVABLES
CORPORATION
By:______________________________________
Title:___________________________________
G-4
Accepted and confirmed as of the date first written above:
By: ABN AMRO BANK N.V., as Agent
By:_____________________________
Title:__________________________
By:_____________________________
Title:__________________________
Address of notice:
ABN AMRO Bank N.V.
Structured Finance, Asset Securitization
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Purchaser Agent-Amsterdam
Telephone Number: (000) 000-0000
Telecopy Number: (000) 000-0000
Acknowledged and agreed to as of the date first written above:
[NAME OF BANK]
By:___________________________
Title:________________________
Address for notice:
_______________________________
_______________________________
_______________________________
G-5
ANNEX A TO
LOCK-BOX LETTER
[Name of Bank]
Re: Crompton & Xxxxxxx Receivables Corporation
Lock Box Numbers ______________
Lock-Box Account Number ____________
Ladies and Gentlemen:
Reference is made to the letter agreement dated _________________ (the
"Letter Agreement") among [NAME OF ORIGINATOR], Crompton & Xxxxxxx Receivables
Corporation, the undersigned, as Agent, and you concerning the above-described
lock-boxes and lock-box account (collectively, the "Accounts"). We hereby give
you notice that a "Termination Event" has occurred and is continuing under the
Receivables Sale Agreement (as defined in the Letter Agreement) and of our
assumption of dominion and control of the Accounts as provided in the Letter
Agreement.
We hereby instruct you not to permit any other party to have access to
the Accounts and to make all payments to be made by you out of or in connection
with the Accounts directly to the undersigned upon our instructions, at our
address set forth above.
Very truly yours,
ABN AMRO BANK N.V.
By:_____________________________________
Title:_______________________________
By:_____________________________________
Title:_______________________________
cc: Crompton & Xxxxxxx Receivables Corporation
G-6
EXHIBIT H
TO
SECOND AMENDED AND RESTATED RECEIVABLES SALE AGREEMENT
COMPLIANCE CERTIFICATE
To: ABN AMRO Bank N.V., as Agent, and
each Purchaser
This Compliance Certificate is furnished pursuant to Section
5.1(a)(iii) of the Second Amended and Restated Receivables Sale Agreement, dated
as of August 16, 2004 (as amended, supplemented or otherwise modified through
the date hereof, the "Sale Agreement"), among Crompton & Xxxxxxx Receivables
Corporation (the "Seller"), CROMPTON CORPORATION (the "Initial Collection
Agent"), the liquidity providers from time to time party thereto (collectively,
the "Liquidity Providers"), Amsterdam Funding Corporation ("Amsterdam" and
together with the Liquidity Providers, the "Purchasers"), and ABN AMRO Bank N.V.
as agent for the Purchasers (in such capacity, the "Agent"). Terms used in this
Compliance Certificate and not otherwise defined herein shall have the
respective meanings ascribed thereto in the Sale Agreement.
THE UNDERSIGNED HEREBY REPRESENTS, WARRANTS, CERTIFIES AND CONFIRMS
THAT:
1. The undersigned is a duly elected Designated Financial
Officer of the undersigned.
2. Attached hereto is a copy of the financial statements
described in Section 5.1(a)(i) or 5.1(a)(ii) of the Sale Agreement.
3. The undersigned has reviewed the terms of the Transaction
Documents and has made, or caused to be made under his/her supervision,
a detailed review of the transactions and the conditions of the Seller
and each Originator during and at the end of the accounting period
covered by the attached financial statements.
4. The examinations described in paragraph 3 hereof did not
disclose, and the undersigned has no knowledge of, the existence of any
condition or event which constitutes a Potential Termination Event,
during or at the end of the accounting period covered by the attached
financial statements or as of the date of this Compliance Certificate,
except as set forth below.
5. Based on the examinations described in paragraph 3
hereof, the undersigned confirms that the representations and
warranties contained in Article IV of the Sale Agreement are true and
correct as though made on the date hereof, except as set forth below.
Described below are the exceptions, if any, to paragraphs 4 and 5
listing, in detail, the nature of the condition or event, the period during
which it has existed and the action the undersigned has taken, is taking or
proposes to take with respect to each such condition or event:
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this Compliance
Certificate in support hereof, are made and delivered this ____ day of
___________, 200__.
[NAME OF SELLER OR ORIGINATOR]
By: _________________________________
Designated Financial Officer
H-2
EXHIBIT I
CREDIT AND COLLECTION POLICY
