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Exhibit 4.2
TRANSFER AND ADMINISTRATION AGREEMENT
Dated as of December 30, 1997
Among
WACKENHUT FUNDING CORPORATION,
AS TRANSFEROR
and
THE WACKENHUT CORPORATION,
INDIVIDUALLY AND
AS SERVICER
and
ENTERPRISE FUNDING CORPORATION,
AS PURCHASER
and
NATIONSBANK, N.A.,
AS AGENT
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TABLE OF CONTENTS
PAGE
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ARTICLE I
THE COMMITMENT
SECTION 1.1. Commitment....................................................................2
SECTION 1.2. Purchase and Reinvestment Limits..............................................3
SECTION 1.3. Making Purchases from the Transferor..........................................3
SECTION 1.4. Number of Undivided Interests.................................................4
SECTION 1.5. Commitment Termination Date...................................................4
SECTION 1.6. Purchase Termination Date.....................................................4
SECTION 1.7. Voluntary Termination of Commitment or
Reduction of Maximum Purchase Limit...........................................5
SECTION 1.8. Limitation of Ownership Interest..............................................5
SECTION 1.9. Special Undivided Interests...................................................5
SECTION 1.10. Benefits of Agreement.........................................................6
ARTICLE II
UNDIVIDED INTEREST AND PURCHASER'S SHARE
SECTION 2.1. Undivided Interest............................................................6
SECTION 2.2. Purchaser's Investment........................................................7
SECTION 2.3. Net Pool-Balance..............................................................9
SECTION 2.4. Shares........................................................................9
ARTICLE III
SETTLEMENTS
SECTION 3.1. Non-Run Off Settlement Procedures for
Collections..................................................................10
SECTION 3.2. Run Off-Settlement Procedures for
Collections..................................................................12
SECTION 3.3. Special Settlement Procedures: Reduction
of Purchaser's Investment, Etc...............................................13
SECTION 3.4. Reporting....................................................................16
SECTION 3.5. Payments and Computations, Etc...............................................16
SECTION 3.6. Dividing or Combining Undivided
Interests....................................................................17
SECTION 3.7. Treatment of Collections and Deemed
Collections..................................................................17
ARTICLE IV
FEES AND YIELD PROTECTION
SECTION 4.1. Fees.........................................................................18
SECTION 4.2. Yield Protection.............................................................19
ARTICLE V
CONDITIONS OF PURCHASES
SECTION 5.1. Conditions Precedent to Initial
Purchase.....................................................................21
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SECTION 5.2. Conditions Precedent to All Purchases
and Reinvestments............................................................24
SECTION 5.3. Additional Condition Precedent to
Purchases....................................................................25
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.1. Representations and Warranties of the
Transferor...................................................................25
SECTION 6.2. Representations and Warranties of the
Servicer.....................................................................30
ARTICLE VII
GENERAL COVENANTS OF THE TRANSFEROR AND SERVICER
SECTION 7.1. Affirmative Covenants of the
Transferor...................................................................34
SECTION 7.2. Reporting Requirements of the
Transferor...................................................................37
SECTION 7.3. Negative Covenants of the Transferor. .......................................39
SECTION 7.4. Affirmative Covenants of Servicer............................................40
SECTION 7.5. Reporting Requirements of Servicer...........................................42
SECTION 7.6. Negative Covenants of the Servicer...........................................44
SECTION 7.7. Financial Covenants of the Servicer..........................................46
ARTICLE VIII
ADMINISTRATION AND COLLECTION
SECTION 8.1. Designation of Servicer......................................................48
SECTION 8.2. Successor Notice: Servicer Transfer
Event........................................................................48
SECTION 8.3. Subcontracts.................................................................48
SECTION 8.4. Duties of Servicer...........................................................49
SECTION 8.5. Allocation of Collections; Segregation. .....................................49
SECTION 8.6. Modification of Receivables..................................................49
SECTION 8.7. Documents and Records........................................................49
SECTION 8.8. Certain Duties to the Transferor.............................................50
SECTION 8.9. Lock-Box Accounts............................................................50
SECTION 8.10. Rights of the Agent..........................................................50
SECTION 8.11. Rights on Servicer Transfer Event............................................51
SECTION 8.12. Responsibilities of the Transferor...........................................51
SECTION 8.13. Further Action Evidencing Purchases..........................................52
SECTION 8.14. Application of Collections...................................................53
ARTICLE IX
SECURITY INTEREST
SECTION 9.1. Grant of Security Interest...................................................53
SECTION 9.2. Further Assurances...........................................................53
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SECTION 9.3. Remedies.....................................................................54
ARTICLE X
[RESERVED]
ARTICLE XI
TERMINATION
SECTION 11.1. Termination Events...........................................................54
SECTION 11.2. Remedies.....................................................................56
ARTICLE XII
THE AGENT
SECTION 12.1. Authorization and Action.....................................................57
SECTION 12.2. Agents' Reliance, Etc........................................................57
SECTION 12.3. Agents and Affiliates........................................................58
ARTICLE XIII
BANK COMMITMENT; ASSIGNMENT OF PURCHASER'S INTEREST
SECTION 13.1. Rights as Bank Investor......................................................58
SECTION 13.2. Indemnification of the Agent.................................................59
SECTION 13.3. Non-Reliance.................................................................59
SECTION 13.4. Payments by the Agent........................................................60
SECTION 13.5. Bank Commitment; Assignment to Bank
Investors....................................................................60
SECTION 13.6. Restrictions on Assignments..................................................64
SECTION 13.7. Rights of Assignee...........................................................64
SECTION 13.8. Authorization of Agent.......................................................65
SECTION 13.9. Notice of Assignment.........................................................65
SECTION 13.10. Evidence of Assignment; Endorsement
of Certificate...............................................................65
SECTION 13.11. Rights of Support Providers..................................................65
ARTICLE XIV
INDEMNIFICATION
SECTION 14.1. Indemnities by the Transferor................................................66
SECTION 14.2. Contest of Tax Claim; After-Tax Basis........................................68
SECTION 14.3. Contribution.................................................................69
ARTICLE XV
MISCELLANEOUS
SECTION 15.1. Amendments, Etc..............................................................69
SECTION 15.2. Notices, Etc.................................................................69
SECTION 15.3. No Waiver; Remedies..........................................................70
SECTION 15.4. Binding Effect; Survival.....................................................70
SECTION 15.5. Costs, Expenses and Taxes....................................................71
SECTION 15.6. No Proceedings...............................................................71
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SECTION 15.7. NationsBank Program Confidentiality..........................................72
SECTION 15.8. Confidentiality of the Transferor
Information..................................................................74
SECTION 15.9. Captions and Cross References................................................76
SECTION 15.10. Integration..................................................................77
SECTION 15.11. Governing Law................................................................77
SECTION 15.12. Waiver Of Jury Trial.........................................................77
SECTION 15.13. Consent To Jurisdictions Waiver Of
Immunities...................................................................77
SECTION 15.14. Execution in Counterparts....................................................78
SECTION 15.15. Purchaser's Liabilities......................................................78
SECTION 15.16. Agent's Liabilities..........................................................78
SECTION 15.17. Delegation of Servicer's Duties. ............................................78
SECTION 15.18. Characterization of the Transactions
Contemplated by this Agreement...............................................78
Appendix A Definitions
Appendix B Calculation of Discount and Reserve
Appendix C Definitions to Financial Covenants
Schedule 2.3(b) Form of Concentration Limit Certificate
Schedule 5.1(a) Form of Certificate of Assignments
Schedule 5.1(h) Form of Lock Box Agreement
Schedule 5.1(i) Form of opinion of Akerman,
Sentersitt & Xxxxxx, P.A.
Schedule 13.5 (b) Form of Assignment and Assumption
Agreement
Schedule 5.1(p)(i) Purchase and Sale Agreement
Schedule 5.1 (p)(ii) Amended and Restated Purchase and
Sale Agreement
Schedule 6.1(j) Litigation
Schedule 6.1(n) Location of Transferor's books,
records and documents
Schedule 6.2(n) Location of Services, books, records
and documents
Schedule 6.2(o) Lock Box Accounts
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TRANSFER AND ADMINISTRATION AGREEMENT
Dated as of December 30, 1997
THIS IS A TRANSFER AND ADMINISTRATION AGREEMENT, among
WACKENHUT FUNDING CORPORATION, a Delaware corporation (the "TRANSFEROR") and its
successors and assigns, THE WACKENHUT CORPORATION, a Florida corporation,
individually and as Servicer ("WACKENHUT" or the "SERVICER"), ENTERPRISE FUNDING
CORPORATION, a Delaware corporation ("ENTERPRISE" or the "PURCHASER") and its
successors assigns, and NATIONSBANK, N.A., a national banking association
("NATIONSBANK"), as agent for Enterprise and the Bank Investors (in such
capacity, the "AGENT") and as a Bank Investor (the "AGREEMENT"). Unless
otherwise indicated, capitalized terms used in this Agreement are defined in
APPENDIX A.
BACKGROUND
1. The Originator has originated, and in the future will originate,
Receivables in the ordinary course of its business, and the Originator has sold,
and from time to time in the future will sell such Receivables to the Seller
pursuant to the Purchase and Sale Agreement.
2. The Seller will from time to time sell such Receivables (together
with Receivables originated by the Seller from time to time in the ordinary
course of its business) to the Transferor pursuant to the terms of the
Receivables Purchase Agreement.
3. Transferor has requested the Purchaser and the Bank Investors to
purchase, and the Purchaser may agree, and the Bank Investors have agreed, to
purchase, subject to the terms and conditions contained in this Agreement,
undivided interests in such Receivables, referred to herein as Undivided
Interests, from Transferor from time to time during the term of this Agreement.
4. Transferor, the Purchaser and the Bank Investors also desire that,
subject to the terms and conditions of this Agreement, certain of the daily
Collections in respect of the Undivided Interests in the Receivables be
reinvested in Receivables through the sale by the Transferor to the Purchaser or
the Bank Investors, as the case may be, of additional Undivided Interests in the
Receivables, such daily reinvestment of Collections to be effected by an
automatic daily adjustment to the Purchaser's Undivided Interest or Bank
Investor's as the case may be, and to be intended to permit the Purchaser or the
Bank Investors, as the
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case may be, to maintain its Purchaser's Investment fully invested in
uncollected Pool Receivables.
5. NationsBank has been requested, and is willing, to act
as the Agent for the Purchaser and the Bank Investors.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereto agree as follows:
ARTICLE I
THE COMMITMENT
SECTION 1.1. COMMITMENT. On the terms and subject to
the conditions set forth in this Agreement (including ARTICLE V):
(a) PURCHASES. Upon the terms and subject to the conditions
herein set forth the Transferor may, at its option, convey, transfer
and assign to the Agent, on behalf of the Purchaser or the Agent, on
behalf of the Bank Investors, as applicable, and the Agent, on behalf
of the Purchaser may, provided the Purchase Termination Date shall not
have occurred, at the Purchaser's option, or the Agent, on behalf of
the Bank Investors, provided that the Purchase Termination Date shall
not have occurred and that the Bank Investors shall have previously
accepted the assignment by the Purchaser of all of its interest in the
Undivided Interests, shall, if so requested by the Transferor, accept
such conveyance, transfer and assignment from the Transferor, without
recourse except as provided herein, undivided percentage ownership
interests in the Receivables, together with Related Security,
Collections and Proceeds with respect thereto (each such conveyance,
transfer and assignment, a "PURCHASE"). Each Purchase shall be in
accordance with SECTION 1.3(B). Under no circumstances shall
Reinvestments be deemed to be Purchases.
(b) REINVESTMENTS. Pursuant to SECTION 3.1, during the period
from the date hereof to the Purchase Termination Date, Servicer shall
cause certain of the Collections in respect of the Undivided Interests
to be applied to the purchase of additional undivided interests in Pool
Receivables, thereby resulting in an appropriate readjustment of such
Undivided Interests. Each such purchase of an additional undivided
interest pursuant to SECTION 3.1 is herein called a "REINVESTMENT". The
Bank Investors' obligation to make such Purchases and Reinvestments is
herein called the "COMMITMENT" and the amount thereof shall be equal to
the Facility Limit.
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SECTION 1.2. PURCHASE AND REINVESTMENT LIMITS. Under no
circumstances shall the Agent, on behalf of the Purchaser or the Bank Investors,
as applicable, make any Purchase or Reinvestment to the extent that, after
giving effect to such Purchase or Reinvestment, as the case may be:
(a) PURCHASE LIMIT. The Aggregate Purchaser
Investments would exceed an amount (the "PURCHASE LIMIT") equal to
the lesser of (x) $60,000,000 as such amount may be reduced
pursuant to SECTION 1.7 (the "MAXIMUM PURCHASE LIMIT"), and
(y) the then Net Pool Balance; or
(b) REQUIRED ALLOCATIONS LIMIT. The Aggregate
Required Allocations would exceed an amount (the "REQUIRED
ALLOCATIONS LIMIT") equal to 100% of the Net Pool Balance
(as defined in SECTION 2.3); or
(c) The sum of the Aggregate Purchaser Investments
plus the Interest Component of all outstanding Related Commercial
Paper would exceed the Facility Limit.
SECTION 1.3. MAKING PURCHASES FROM THE TRANSFEROR. (a) NOTICE
OF PURCHASE. Each Purchase from the Transferor shall be made by the Agent on
behalf of the Purchaser or the Agent on behalf of the Bank Investors, as
applicable, and shall be made on notice from the Transferor to the Agent
received by the Agent not later than 11:00 a.m. (New York time) on the Business
Day next preceding the date of such proposed Purchase; it being understood and
agreed that once any proposed Purchase hereunder is acquired on behalf of the
Bank Investors, the Agent, on behalf of such Bank Investors, shall be required
to purchase, and the Purchaser shall be required to sell, all Undivided
Interests held by the Agent on behalf of the Purchaser in accordance with
SECTION 13.5 and thereafter no additional Purchases shall be acquired on behalf
of the Purchaser hereunder. If such notice is received after 11:00 a.m. (New
York time) by the Agent, such notice shall be deemed provided on the next
following Business Day. Each such notice of a proposed Purchase shall specify
the desired amount and date of such Purchase and the desired duration of the
initial Yield Periods for the resulting Undivided Interests. The Agent (or, if
then funding, an Enterprise Liquidity Provider or Enterprise Credit Support
Provider, as applicable) shall select the duration of such initial, and each
subsequent, Yield Period with regard to the Purchaser's Investment Percentage of
such Purchase in its discretion; PROVIDED that the Agent shall use reasonable
efforts, taking into account market conditions, to accommodate the Transferor's
preferences.
(b) AMOUNT OF PURCHASE. The amount of each Purchase
shall be equal to the lesser of (x) the amount proposed by the
Transferor pursuant to SECTION 1.3(A) and (y) the maximum amount
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permitted for the Purchaser or the Bank Investors, as the case may be under
SECTION 1.2.
(c) FUNDING OF PURCHASE. On the date of each Purchase, upon
satisfaction of the applicable conditions set forth in ARTICLE V, the Purchaser
or each Bank Investor, as the case may be, shall make available to the Agent at
the address of its office set forth on the signature pages hereto, the dollar
amount of the Purchase Price, in the case of the Purchaser, or in the case of
the Bank Investors, the amount of each Bank Investors Percentage of such
Purchase Price (determined pursuant to SECTION 1.3(B)) in same day funds, and
the Agent will make such funds immediately available to the Transferor at such
office.
SECTION 1.4. NUMBER OF UNDIVIDED INTERESTS. The number of
Undivided Interests hereunder at any one time, after giving effect to any
Purchase, Reinvestment, division or combination, shall not exceed 8 for the
Purchaser, individually or for the Bank Investors, collectively.
SECTION 1.5. COMMITMENT TERMINATION DATE. (a) The "COMMITMENT
TERMINATION DATE" shall be the earlier to occur of (i) December 29, 1998
(herein, as the same may be extended, called the "SCHEDULED COMMITMENT
TERMINATION DATE"), and (ii) the date of Termination of the Commitment pursuant
to SECTION 1.7 or 11.2.
(b) The then Scheduled Commitment Termination Date may be
extended from time to time beginning with December 29, 1998, by written notice
of request given by the Transferor to the Agent at least 75 days before the then
Scheduled Commitment Termination Date, and written notice of acceptance given by
the Agent to the Transferor not later than 15 days prior to such Scheduled
Commitment Termination Date. No such extension shall be effective unless the
Agent shall provide such notice of acceptance to the Transferor.
SECTION 1.6. PURCHASE TERMINATION DATE. As to the Purchaser or
any Bank Investor (a) the "PURCHASE TERMINATION DATE" with respect to such
entity shall be the earlier to occur of (i) the Commitment Termination Date and
(ii) the date of termination of the Commitment with respect to Purchases by the
Purchaser or the Bank Investors, as the case may be, pursuant to SUBSECTIONS (B)
OR (C) HEREOF.
(b) The Commitment shall terminate with respect to Purchases
by the Purchaser and the Purchaser shall have no obligation to make any further
Purchases or Reinvestments hereunder, on the date of termination of the
commitment of any (i) Enterprise Liquidity Provider under an Enterprise
Liquidity Agreement or (ii) Enterprise Credit Support Provider under an
Enterprise Credit Support Agreement. The Purchaser agrees to
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give the Transferor (with a copy to the Agent) at least 30 days' prior written
notice, unless circumstances shall not permit such 30 days' notice, of the
termination of the Commitment with respect to Purchases by the Purchaser
pursuant to the foregoing sentence, but failure to give or delay in giving such
notice shall not prevent or delay such termination.
(c) The provisions of SECTION 3.1 or SECTION 3.2, as
applicable, shall apply with respect to the Purchaser's Investment until such
time as the Purchaser has or the Bank Investors, as applicable, have received
the return of the Aggregate Purchaser's Investment, Earned Discount thereon and
all other amounts due to the Purchaser or the Bank Investors, as the case may
be, at which time the Purchaser's or the Bank Investors', as the case may be,
rights and obligations under this Agreement shall terminate.
SECTION 1.7. VOLUNTARY TERMINATION OF COMMITMENT OR REDUCTION
OF MAXIMUM PURCHASE LIMIT. The Transferor may, upon at least five Business Days'
notice to the Agent, terminate the Commitment in whole or reduce in part the
unused portion of the Maximum Purchase Limit; PROVIDED, HOWEVER, that (a) each
partial reduction shall be in an amount equal to $5,000,000 or an integral
multiple thereof and (b) after giving effect to such reduction, the remaining
Maximum Purchase Limit will not be less than $20,000,000.
SECTION 1.8. LIMITATION OF OWNERSHIP INTEREST. Nothing in this
Agreement shall be interpreted as providing the Purchaser or any Bank Investor
with an ownership interest in Receivables that are not Pool Receivables.
SECTION 1.9. SPECIAL UNDIVIDED INTERESTS. The Transferor
shall maintain with the Purchaser or with the Bank Investors, as the case may
be, at least one Undivided Interest, the Purchaser's Investment in which shall
be no less than $4,000,000 (unless otherwise agreed by the Agent) and which
shall have a related Yield Period of no more than 35 days ending on the
twenty-fourth day of each calendar month (or if such day is not a Business Day,
the next succeeding Business Day) and beginning on the day immediately
succeeding the last day of the previous Yield Period (provided that the first
Yield Period shall begin on the date of the first Purchase hereunder). If on any
day the Undivided Interest required to be maintained with the Purchaser or with
the Bank Investors pursuant to this SECTION 1.9 shall for any reason have a
Purchaser's Investment of less than $4,000,000, the Agent shall manage the Yield
Periods related to the Purchaser's Investment other Undivided Interests in a
manner such that within 60 days of such day the Purchaser's Investment of such
Undivided Interest required to be maintained pursuant to this SECTION 1.9 shall
again equal $4,000,000.
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SECTION 1.10. BENEFITS OF AGREEMENT. In the event the Bank
Investors acquire Undivided Interests hereunder, each Bank Investor shall be
equally and ratably entitled to the benefits of this Agreement, the other
Agreement Documents and the Receivables Pool, the Related Security and the
Collections without preference, priority or distinction on account of the
actual timing of the filing of any financing statements under the UCC, all in
accordance with the terms and provisions of this Agreement and the other
Agreement Documents.
ARTICLE II
UNDIVIDED INTEREST AND PURCHASER'S SHARE
SECTION 2.1. UNDIVIDED INTEREST. (a) DEFINITION AND
COMPUTATION OF UNDIVIDED INTEREST. For purposes of this Agreement, "UNDIVIDED
INTEREST" for the Purchaser and/or Bank Investors, as applicable, means, as the
context may require (i) undivided ownership interest, in a percentage determined
from time to time as provided in CLAUSE (II) below, in (A) all then outstanding
Pool Receivables, (B) all Related Security with respect to such Pool
Receivables, and (C) all Collections with respect to, and other proceeds of,
such Pool Receivables and Related Security; and (ii) at any time, the quotient,
expressed as a percentage, obtained by dividing the Required Allocation for such
Undivided Interest by the Net Pool Balance. Each Undivided
Interest shall be computed as follows:
UI = RA = PI + DF + DR + LR + SFR
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NPB NPB
WHERE:
UI = the Undivided Interest at any time;
RA = the Required Allocations of such undivided Interest
at such time, which shall be an amount at any
time equal to the amount of the numerator of the
fraction set forth above;
PI = the Purchaser's Investment of such Undivided
Interest at such time as determined pursuant to
SECTION 2.02;
DF = the Discount Factor of such Undivided Interest at
such time, as determined pursuant to PART I of
APPENDIX B;
DR = the Dilution Reserve of such Undivided Interest at
such time, as determined pursuant to PART II of
APPENDIX B;
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LR = the Loss Reserve of such Undivided Interest at
such time, as determined pursuant to PART II of
APPENDIX B;
SFR = the Servicer's Fee Reserve of such Undivided
Interest at such time, as determined pursuant to
PART III of APPENDIX B; and
NPB = the Net Pool Balance at such time, as determined
pursuant to SECTION 2.3.
The "RELATED" Undivided Interest with respect to any of the foregoing items
shall mean the Undivided Interest as to which such item is calculated.
(b) FREQUENCY OF COMPUTATION OF PURCHASER'S INTEREST. Each
Undivided Interest shall initially be computed as of the opening of business of
Servicer on the date of Purchase of such Undivided Interest from the Transferor,
and such Undivided Interest shall be recomputed upon receipt of each Periodic
Report. The Agent on behalf of the Purchaser or the Bank Investors, as the case
may be, may at any time request Servicer to recompute its Undivided Interests.
In addition, until such Undivided Interest shall be reduced to zero, such
Undivided Interest shall be deemed to be automatically recomputed as of the
close of business of Servicer on each day (other than a day on which an actual
recomputation is done), and, as so recomputed, shall constitute the percentage
ownership interest in Pool Receivables held by the Purchaser or the Bank
Investors, as the case may be, on such day. Such Undivided Interest shall become
zero at such time as the Purchaser, or the Bank Investors, as the case may be,
shall have received the accrued Earned Discount for such Undivided Interest,
shall have recovered the Purchaser's Investment of such Undivided Interest and
shall have received all other amounts payable to the Purchaser or the Bank
Investors, as applicable, pursuant to this Agreement in respect of such
Undivided Interest and Servicer shall have received the accrued Servicer's Fee
for such Undivided Interest. Such Undivided Interest shall remain constant from
the time as of which any such computation or recomputation is made until the
time as of which the next such recomputations if any, shall be made.
SECTION 2.2. PURCHASER'S INVESTMENT. (a) Subject to
SUBSECTIONS (B) and (C), the "PURCHASER'S INVESTMENT" of an Undivided Interest
owned by the Purchaser or any Bank Investor at any time means an amount equal
to:
(i) the aggregate of the amounts theretofore paid by the
Purchaser or the Bank Investors, to the Transferor (and, in the case of
the Bank Investors, to the Purchaser) for the acquisition of such
Undivided Interest (A) by Purchase pursuant to SECTIONS 1.1(A)
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and 1.3 and (B) by Reinvestments pursuant to SECTIONS 1.1(B) and 3.1,
and (C) in the case of the Bank Investors, pursuant to SECTION 13.5,
less
(ii) the aggregate amount of Collections theretofore received
and distributed on account of the Purchaser's Investment pursuant to
SECTIONS 3.1 and 3.2.
(b) Solely for purposes of calculating the Earned Discount
(and each component thereof) with respect to a portion of an Undivided Interest
purchased or funded by an Enterprise Liquidity Provider or Enterprise Credit
Support Provider pursuant to the PROVISO to the definition of "EARNED DISCOUNT"
in APPENDIX B:
(i) "PURCHASER'S INVESTMENT" of any portion of an Undivided
Interest owned by an Enterprise Liquidity Provider or otherwise funded
pursuant to an Enterprise Liquidity Agreement shall be deemed to be the
amount paid to Enterprise by such Enterprise Liquidity Provider as the
purchase price of, or the original principal amount loaned with
respect to, such portion (less any portion of such purchase price or
principal amount allocable to Earned Discount accrued and unpaid at the
time of purchase or funding by such Enterprise Liquid ity Provider), as
reduced from time to time by Collections indefeasibly received and
distributed to such Enterprise Liquidity Provider on account of such
purchase price or principal amount (other than any portion allocable
to Earned Discount pursuant to Sections 3.1 and 3.2 hereof);
(ii) "PURCHASER'S INVESTMENT" of any portion of an Undivided
Interest funded under an Enterprise Credit Support Agreement shall be
deemed to be the principal amount of the advance or drawing under such
Enterprise Credit Support Agreement with respect to such portion (less
the amount, if any, of such advance or drawing used to fund Earned
Discount accrued and unpaid at the time of the making of such advance
or drawing), as reduced by any payments indefeasibly made by Enterprise
or the Enterprise Liquidity Provider to the Enterprise Credit Support
Provider in reimbursement of such drawing or repayment of such
advance, as the case may be (less any amount allocable to such accrued
and unpaid Earned Discount); and
(iii) "PURCHASER'S INVESTMENT" of any other portion of an
Undivided Interest shall mean such Purchaser's Investment of such
Undivided Interest LESS the sum of such Purchaser's Investments of all
portions of such Undivided Interest described in CLAUSES (I) and
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(II) above, calculated in accordance with such CLAUSES (I) and (II),
as applicable.
(c) The Purchaser's Investment shall not be considered reduced
by any distribution of any portion of Collections if at any time such
distribution is rescinded or must otherwise be returned for any reason.
(d) The "RELATED" Purchaser's Investment with regard to a
Yield Period or Undivided Interest (or portion thereof) means the Purchaser's
Investment calculated with regard to such Yield Period or Undivided Interest (or
such portion), as the case may be.
SECTION 2.3. NET POOL-BALANCE. (a) The "NET POOL BALANCE" at
any time means an amount equal to:
(i) the aggregate Unpaid Balance of the Eligible Receivables
in the Receivables Pool at such time, MINUS
(ii) the aggregate (for all Obligors) of the amounts by which
(x) the Unpaid Balance of all Pool Receivables of each Obligor exceeds
(y) the Concentration Limit for such Obligor at such time.
(b) "CONCENTRATION LIMIT" for any Obligor or Government
Obligor (Government Obligors in the aggregate may not exceed 15% of the Net Pool
Balance at any time as set forth on Schedule 2.03(b)) at any time means the
greater of (x) the Special Concentration Limit, if any, for such Obligor and
(y) 2.0% of the Aggregate Unpaid Balance of the Eligible Receivables in the
Receivables Pool at such time.
(c) "SPECIAL CONCENTRATION LIMIT" for any Obligor means the
amount designated from time to time as such by the Agent with regard to any
Obligor in a writing in the form of SCHEDULE 2.03(B) delivered to the Transferor
(it being understood that the most recent writing at any time delivered to the
Transferor shall supersede each previous writing).
(d) In the case of any Obligor which is an Affiliate of any
other Obligor, the Concentration Limit, the Special Concentration Limit, if any,
and the aggregate Unpaid Balance of Pool Receivables of such Obligors shall be
calculated as if such Obligors were one Obligor.
SECTION 2.4. SHARES.
(a) AGGREGATE PURCHASER'S SHARE. The Purchaser's, or the Bank
Investors', as the case may be, "AGGREGATE PURCHASER'S SHARE" of Collections of
Pool Receivables received (or deemed received) by the Transferor or Servicer on
any day means an
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amount calculated by the Servicer (subject to recalculation by
any Agent) equal to the product of:
(i) the amount of all Collections of Pool Receivables
received (or deemed received) by the Transferor or Servicer on such
day, TIMES
(ii) the Aggregate Required Allocations divided by the Net
Pool Balance.
(b) PURCHASER'S SHARE. With respect to each Undivided
Interest, the related "PURCHASER'S SHARE" of Collections of Pool Receivables
received (or deemed received) by the Transferor or Servicer on any day means an
amount equal to the product of:
(i) the Aggregate Purchaser's Share of Collections for such
day, TIMES
(ii) (A) if such day is not a Run Off Day, the quotient of (1)
such Undivided Interest on such day, expressed as a decimal DIVIDED BY
(2) all of the Undivided Interests on such day, expressed as a
decimal,
(B) if such day is a Run Off Day, the quotient of (1) such
Undivided Interest on the first Run Off Day to have occurred during the
then current Run Off Period, expressed as a decimal, DIVIDED BY (2) all
of the Undivided Interests on such day, expressed as a decimal;
PROVIDED that after such time as an Undivided Interest shall equal
zero, the Purchaser's Share of Collections therefor shall also equal
zero, and
(C) each Bank Investor shall share PRO RATA in the Aggregate
Purchaser's Share.
ARTICLE III
SETTLEMENTS
SECTION 3.1. NON-RUN OFF SETTLEMENT PROCEDURES FOR
COLLECTIONS. (a) DAILY PROCEDURE. On each day (other than a Run Off Day) in any
Yield Period for any Undivided Interest, Servicer shall deem an amount equal to
the Purchaser's Share but not in excess of the Aggregate Purchaser's Share (as
determined in SECTION 2.4) of Collections of Pool Receivables received or deemed
received on such day to be received in respect of such Undivided Interest; and
(i) out of the Purchaser's Share of such Collections, hold in
trust for the benefit of the Purchaser or the Bank Investors, as the
case may be, of such Undivided Interest an amount equal to the related
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Earned Discount and related Servicer's Fee accrued through such day and
not previously so held for the benefit of the Purchaser or the Bank
Investors, as the case may be,
(ii) apply an amount equal to the remainder of the Purchaser's
Share of such Collections (the "REMAINING COLLECTIONS") to reduce the
Purchaser's Investment of such Undivided Interest (it being understood
that such amount need not be physically paid to the Purchaser or the
Bank Investors under this CLAUSE (II)),
(iii) subject to SECTION 3.3, after such reduction, (A) apply
such Remaining Collections to the Reinvestment, for the benefit of the
Purchaser or the Bank Investor, as the case may be, of additional
undivided interests in Pool Receivables by recomputation of such
Undivided Interest pursuant to SECTION 2.1 as of the end of such day,
thereby increasing the Purchaser's Investment, and (B) pay to the
Transferor such Remaining Collections.
The recomputed Undivided Interest shall constitute the percentage ownership
interest in Pool Receivables on such day held by the Purchaser or the Bank
Investors, as the case may be, with regard to such Undivided Interest.
(b) SETTLEMENT DATE PROCEDURE. On the Settlement Date for each
Undivided Interest, for each day in the related Yield Period of such Settlement
Period that is not a Run Off Day for such Undivided Interest, out of the related
Purchaser's Share of Collections for each such Undivided Interest, Servicer
shall deposit to the Agent's account for the Purchaser, or the Bank Investors,
whichever then holds such Undivided Interest, as described in SECTION 3.5, the
amounts set aside as described in SECTION 3.1(A)(I) and the amounts, if any, set
aside pursuant to SECTION 3.3(B) or (C) for payment to the Agent on such
Settlement Date; PROVIDED, HOWEVER, that if the Agent gives its consent (which
consent may be revoked at any time), Servicer may retain amounts which would
otherwise be deposited in respect of Servicer's Fee, in which case no
distribution shall be made in respect of Servicer's Fee under CLAUSE (C) below.
(c) ORDER OF APPLICATION. Upon receipt by the Agent of funds
distributed pursuant to SUBSECTION (B) in respect of an Undivided Interest owned
by the Purchaser or the Bank Investors, as the case may be, the Agent shall
distribute such funds first, (i) to the Purchaser or the Bank Investors, as
applicable, in payment of the accrued and unpaid Earned Discount [and Program
Fee] for such Undivided Interest until paid in full, then (ii) to Servicer in
payment of the accrued and unpaid Servicer's Fee payable with respect to such
Undivided Interest until paid in
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full, and (iii) in the case of any amounts set aside pursuant to SECTION 3.3(B)
or (C), to the Purchaser or the Bank Investors, as applicable, in reduction of
the Purchaser's Investment therein.
SECTION 3.2. RUN OFF-SETTLEMENT PROCEDURES FOR COLLECTIONS.
(a) DAILY PROCEDURE. On each Run Off Day occurring in any Yield Period for an
Undivided Interest, Servicer shall set aside and hold in trust for the Purchaser
or the Bank Investors, as appropriate, the Purchaser's Share of the Collections
of Pool Receivables in respect of such Undivided Interest for such Run Off Day
but not in excess of the Aggregate Purchaser's Share and, if requested in
writing by the Agent (in its sole discretion), by depositing such Collections
within one Business Day of the Servicer's receipt thereof into a bank account at
the Agent on behalf of the Purchaser or the Bank Investors in which no other
funds shall be deposited.
(b) SETTLEMENT DATE PROCEDURE. On each Settlement Date for
each Undivided Interest, if one or more Run Off Days for such Undivided Interest
occurred during the related Yield Period for the Settlement Period ending on
such Settlement Date for such Undivided Interest, Servicer shall deposit to the
account of the Agent for the benefit of the Purchaser or the Bank Investors then
owning such Undivided Interest, as described in SECTION 3.5, the amounts set
aside pursuant to SECTION 3.2(A) out of the Purchaser's Share of Collections
during such Settlement Period, but not to exceed the sum of (i) the accrued and
unpaid Earned Discount, (ii) the Purchaser's Investment of such Undivided
Interest, (iii) the aggregate of other amounts owed hereunder by the Transferor
to the Purchaser, any Bank Investor or the Agent in respect of such Undivided
Interest, and (iv) the accrued Servicer's Fee payable with respect to such
Undivided Interest. If no Termination Event or Unmatured Termination Event shall
have occurred and be continuing, any amounts set aside pursuant to the first
sentence of this SECTION 3.2 and not required to be deposited to the Agent's
account pursuant to the next preceding sentence shall be paid to the Transferor
by Servicer.
(c) ORDER OF APPLICATION. Upon receipt by the Agent of funds
deposited to its account pursuant to SECTION 3.2(B), the Agent shall distribute
such funds (i) to the Purchaser or the Bank Investors, as the case may be, or to
the Agent (as the case may be) (A) in payment of the accrued and unpaid Earned
Discount and Program Fee for such Undivided Interest, (B) in reduction of the
Purchaser's Investment of such Undivided Interest and (C) in payment of any
other amounts owed by the Transferor hereunder to the Purchaser or the Agent, in
each case until reduced to zero, and (ii) to Servicer in payment of the accrued
and unpaid Servicer's Fee payable with respect to such Undivided Interest, also
until reduced to zero. If there shall be insufficient funds on deposit for the
Agent to distribute funds in payment in full of the aforementioned amounts, the
Agent shall distribute funds
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on deposit, FIRST, in payment of the Earned Discount and Program Fee for such
Undivided Interest, SECOND, in payment of the Servicer's Fee payable with
respect to such Undivided Interest, if any, (if Servicer is not the Transferor
or an Affiliate of the Transferor), THIRD, in reduction of Purchaser's
Investment of such Undivided Interest, FOURTH, in payment of any other amounts
payable to the Purchaser, any Bank Investor, or to the Agent hereunder, and
FIFTH, in payment of the Servicer's Fee payable with respect to such Undivided
Interest (if Servicer is the Transferor or an Affiliate of the Transferor).
SECTION 3.3. SPECIAL SETTLEMENT PROCEDURES: REDUCTION OF
PURCHASER'S INVESTMENT, ETC. (a) DEEMED COLLECTIONS. If on any day:
(i) the Unpaid Balance of any Pool Receivable is:
(A) reduced as a result of any defective, rejected or
returned merchandise or services, any cash discount, or any
adjustment by the Transferor, any Originator or Seller or any
Affiliate of the Transferor or any Originator or Seller (other
than any adjustment permitted by SECTION 8.2(C) unless the
Agent, the Purchaser or any Bank Investor, as the case may be,
shall reasonably object thereto within 30 days of being
informed thereof); or
(B) reduced or cancelled as a result of a setoff in
respect of any claim by the Obligor thereof against the
Transferor, any Originator or Seller or any Affiliate of the
Transferor or any Originator or Seller (whether such claim
arises out of the same or a related or an unrelated
transaction); or
(C) reduced on account of the obligation of
the Transferor to pay to the related Obligor any
rebate or refund; or
(ii) any of the representations or warranties of the
Transferor set forth in SECTION 6.1(L) or (P) is no longer true with
respect to a Pool Receivable, then, on such day, Servicer shall be
deemed to have received a Collection of such Pool Receivable
(I) in the case of CLAUSE (I) above, in the
amount of such reduction or cancellation; and
(II) in the case of CLAUSE (II) above, in the amount
of the Unpaid Balance of such Pool Receivable.
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(b) UNREINVESTED COLLECTIONS. Collections that may not be
reinvested by means of Reinvestments in an Undivided Interest on account of the
application of the Required Allocations Limit or the Purchase Limit pursuant to
SECTION 1.2 shall be so reinvested as soon as it is possible to do so without
violating such Required Allocations Limit or Purchase Limit, as the case may be.
To the extent and so long as such Collections may not be so reinvested, Servicer
shall hold such Collections ratably in trust for the benefit of the Purchaser or
the Bank Investors, as the case may be, and, if requested by the Agent, in a
separate deposit account with the Agent containing only the Purchaser's Share of
such Collections and no other funds, for payment to the Agent on the next
following Settlement Date for application to the next maturing Undivided
Interests.
(c) THE TRANSFEROR'S REDUCTION OF AGGREGATE PURCHASER'S
INVESTMENT. If at any time the Transferor shall wish to cause the reduction of
the Aggregate Purchaser's Investment (but not to commence the liquidation, or
reduction to zero, of all Undivided Interests), the Transferor may do so as
follows:
(i) the Transferor shall give the Agent at least three
Business Days' prior written notice thereof (including the amount of
such proposed reduction and the proposed date on which such reduction
will commence) and, if applicable, shall cause the reduction to be
allocated ratably among the Bank Investors such that each Bank Investor
shall receive its pro rata share of the aggregate amount of such
proposed reductions;
(ii) on the proposed date of commencement of such reduction
and on each day thereafter, Servicer shall refrain from reinvesting
Remaining Collections in Undivided Interests, until the amount thereof
not so reinvested shall equal the desired amount of reduction for the
Purchaser or the Bank Investors, as the case may be; and
(iii) Servicer shall hold such Collections for the benefit of
the Purchaser or the Bank Investors, as the case may be, for the
payment to the Agent for each Undivided Interest proposed to be reduced
in connection herewith, in which such Collections are accumulated, and
such amounts shall be applied to reduce the Purchaser's Investment in
such Undivided Interests in accordance with the PROVISOS hereto and
with regard to any Undivided Interest, the related Purchaser's
Investment of such Undivided Interest shall be deemed reduced in the
amount to be paid to the Agent only when in fact finally so paid;
PROVIDED that,
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(A) any such reduction may only be effected on the
last day of the related Yield Period for any Undivided
Interest the related Purchaser's Investment in which has been
requested to be reduced and only to the extent that after
giving effect to any such reduction the remaining Purchaser's
Investment in such Undivided Interest shall not be less than
$1,000,000 (unless the Purchaser's Investment of such
Undivided Interest shall thereby be reduced to zero) and shall
be in an integral multiple of $100,000,
(B) if the Transferor shall commence any voluntary
reduction in a Yield Period containing all or a portion of any
Run Off Period, Collections not so reinvested shall be
treated as if collected on the next following Run Off Day,
(C) the Transferor shall use reasonable efforts to
attempt to choose a reduction amount, and the date of
commencement thereof, so that such reduction shall commence
and conclude in the same Yield Period, and
(D) if two or more Undivided Interests of the
Purchaser or any Bank Investor shall be outstanding at the
time of any proposed reduction, such proposed reduction shall
be applied, unless the Agent shall consent otherwise, to the
Undivided Interest with the shortest remaining Yield Period.
(d) ALLOCATIONS OF OBLIGOR'S PAYMENTS. Except as provided in
SECTION 3.3(A) or as otherwise required by law or the underlying Contract, all
Collections received from an Obligor of any Receivable shall be applied to
Receivables then outstanding of such Obligor in the order of the age of such
Receivables, starting with the oldest such Receivable; PROVIDED, HOWEVER, that,
if payment is designated by such Obligor for application to specific
Receivables, it shall be applied to such specified Receivables.
(e) DEPOSIT TO COLLECTION ACCOUNT. Notwithstanding anything
herein to the contrary, the Agent may require the Transferor and Servicer (or
their designees or successors) at any time (such instruction shall be deemed
given upon the occurrence and continuance of a Termination Event), to deposit
all Collections of Pool Receivables received (including, without limitation,
received by any Lock-Box Bank) to an account established at the Agent (the
"COLLECTION ACCOUNT") within one Business Day of receipt thereof. Such
Collections shall be applied by the Agent in accordance with the provisions of
this Agreement, including
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SECTIONS 3.1, 3.2 or 3.3 hereof. Servicer (or its designee or successor) shall
notify the Agent of the amount of funds deposited in the Collection Account not
received from Pool Receivables and the Agent shall remit such funds as soon as
practicable after such notification to such account as Servicer (or its designee
or successor) shall designate.
SECTION 3.4. REPORTING. (a) On or prior to the twentieth day
of each month (or if such day is not a Business Day, the next succeeding
Business Day), Servicer shall prepare and forward to the Agent a PERIODIC REPORT
(including a certification that no Termination Event or Unmatured Termination
Event shall have occurred) relating to all Undivided Interests owned by the
Purchaser or the Bank Investors, as applicable, as of the close of business of
Servicer on the next preceding Month End Date.
(b) On or prior to each Settlement Date, the Transferor will
advise the Agent and, if Wackenhut is not the Servicer, the Servicer of each Run
Off Day occurring during the Settlement Period ending on such Settlement Date.
(c) On or prior to each Purchase or Reinvestment hereunder,
the Transferor shall permanently xxxx in the computer records for each
Receivable subject to such Purchase or Reinvestment that such Receivable is
subject to the interest of the Agent, on behalf of the Purchaser or the Bank
Investors hereunder, as the case may be.
SECTION 3.5. PAYMENTS AND COMPUTATIONS, ETC. (a) Unless
otherwise required pursuant to this Agreement, all amounts to be paid or
deposited by the Transferor hereunder shall be paid or deposited in accordance
with the terms hereof no later than noon (New York time) on the day when due in
lawful money of the United States of America in same day funds to accounts
indicated in SECTION [ ] hereof unless otherwise notified by the Agent. If the
Agent shall have received such funds by noon (New York time), it shall forward
the portion of the funds deposited that are due to the Purchaser or the Bank
Investors by 3:00 p.m. (New York time) on such day and if received after noon
(New York time), on the next following Business Day.
(b) The Transferor or Servicer, as applicable, shall, to the
extent permitted by law, pay to the Agent interest on all amounts not paid or
deposited when due hereunder at 2% PER ANNUM above the Alternate Reference Rate,
payable on demand; PROVIDED, HOWEVER, that such interest rate shall not at any
time exceed the maximum rate permitted by applicable law. Such interest shall be
retained by the Agent except to the extent that such failure to make a timely
payment or deposit has continued beyond the date for distribution by the Agent
of such overdue amount to the Purchaser or the Bank Investors, if any, or any
other Person
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having an interest in such overdue amount, in which case such interest accruing
after such date shall be for the account of, and distributed by the Agent, to
such Persons ratably in accordance with their respective interests in such
overdue amount.
(c) All computations of interest, Earned Discount, Negative
Spread Fee and any other fees hereunder shall be made on the basis of a year of
360 days for the actual number of days (including the first day but excluding
the last day) elapsed.
SECTION 3.6. DIVIDING OR COMBINING UNDIVIDED INTERESTS.
(a) DIVISION OF UNDIVIDED INTERESTS. The Agent may at any
time, as of the last day of any Yield Period for any then existing Undivided
Interest owned by the Purchaser or any Bank Investor, as the case may be, divide
such existing Undivided Interest on such last day into two or more new Undivided
Interests, each such new Undivided Interest having a Purchaser's Investment as
designated by the Agent and all such new Undivided Interests collectively having
aggregate Purchaser's Investments equal to the Purchaser's Investment of such
existing Undivided Interest.
(b) COMBINATION OF UNDIVIDED INTERESTS. The Agent may at any
time, as of the last day of any Yield Period for two or more existing Undivided
Interests owned by the Purchaser or the Bank Investors, as the case may be, on
or before the date of any proposed Purchase of an Undivided Interest pursuant to
SECTIONS 1.1 and 1.4 by the Purchaser or the Bank Investors, as the case may be,
on such last day or such date of Purchase, as the case may be, combine into one
new Undivided Interest such existing and/or proposed Undivided Interests or any
combination thereof, such new Undivided Interest having a Purchaser's Investment
equal to the aggregate Purchaser's Investments of such Undivided Interests so
combined.
(c) EFFECT OF DIVISION OR COMBINATION. On and after any
division or combination of Undivided Interests as described above, each of the
new Undivided Interests resulting from such division, or the new Undivided
Interest resulting from such combination, as the case may be, shall be a
separate Undivided Interest having a Purchaser's Investment as set forth above,
and shall take the place of such existing Undivided Interest or Undivided
Interests or proposed Undivided Interest, as the case may be, in each case under
and for all purposes of this Agreement.
SECTION 3.7. TREATMENT OF COLLECTIONS AND DEEMED COLLECTIONS.
The Transferor shall forthwith deliver to Servicer all Collections deemed
received by the Transferor pursuant to SECTION 3.3(A), and Servicer shall hold
or distribute such
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Collections as Earned Discount, accrued Servicer's Fee, repayment of Purchaser's
Investment, etc., to the same extent as if such Collections had actually been
received on the date of such delivery to Servicer. If Collections are then being
paid to the Agent, or lock boxes or accounts directly or indirectly owned or
controlled by the Agent, Servicer shall forthwith cause such deemed Collections
to be ratably paid to the Agent or to such lock boxes or accounts, as
applicable. So long as the Transferor shall hold any Collections or deemed
Collections required to be paid to Servicer or to the Agent, it shall hold such
Collections in trust and separate and apart from its own funds and shall clearly
xxxx its records to reflect such trust.
ARTICLE IV
FEES AND YIELD PROTECTION
SECTION 4.1. FEES. (a) AGENT'S FEES. Fees payable to the Agent
for services performed in its capacity as Agent or as Agent for the benefit of
the Purchaser or the Bank Investors, as the case may be, shall be due and
payable on such dates and in such amounts as set forth in the letters dated the
date the conditions precedent set forth in Section 5.1 are first satisfied,
from the Agent to the Transferor (the "FEE LETTERS").
(b) NOTE FEE. From the date hereof until the date, on or after
the Commitment Termination Date, on which the Aggregate Total Investments shall
be reduced to zero, the Transferor shall pay to the Agent for the account of the
Purchaser, a note issuance fee ("NOTE FEE") in an amount equal to the product
of (x) the greater of $15, or the note fee actually paid or payable by the
Purchaser to the issuing agent and depositary for the Commercial Paper Notes
for the authentication and delivery of each Commercial Paper Note, as notified
by the Agent on behalf of the Purchaser to the Transferor and Servicer from time
to time, TIMES (y) the number of Commercial Paper Notes issued by the Purchaser
to fund its Undivided Interests hereunder during the period for which such Note
Fee is payable, as notified by the Agent on behalf of the Purchaser to the
Transferor and Servicer; PROVIDED THAT, if such Commercial Paper Notes shall at
any time become "book-entry" Notes, the "Note Fee" therefor shall equal $30 per
trade. Such Note Fee shall be paid in arrears on the first Business Day of each
month for the preceding calendar month for the number of Commercial Paper Notes
issued to fund the Undivided Interests owned by the Purchaser during the
preceding calendar month for which no Note Fee shall have theretofore been paid.
The Agent, on behalf of the Purchaser, shall notify the Transferor and Servicer
at least one Business Day prior to the end of each calendar month of the number
of Commercial Paper Notes issued by the Purchaser to fund its Undivided
Interests hereunder during such calendar month.
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(c) DEALER FEE. The dealer fee is set forth in CLAUSE (II) of
the definition of Commercial Paper Rate.
SECTION 4.2. YIELD PROTECTION. (a) If (i) Regulation D or (ii)
any Regulatory Change occurring after the date hereof:
(A) shall subject an Affected Party to any tax, duty or other
charge with respect to any Undivided Interest owned by or funded by it
or any obligations or right to make Purchases or Reinvestments or to
provide funding therefor, or shall change the basis of taxation of
payments to the Affected Party of any Purchaser's Investments or Earned
Discount owned by, owed to or funded by it or any other amounts due
under this Agreement in respect of any Undivided Interest owned by or
funded by it or its obligations or rights, if any, to make Purchases or
Reinvestments or to provide funding therefor (except for changes in the
rate of tax on the overall net income of such Affected Party imposed by
the United States of America, by the jurisdiction in which such
Affected Party's principal executive office is located and, if such
Affected Party's principal executive office is not in the United States
of America, by the jurisdiction where such Affected Party's principal
office in the United States is located); or
(B) shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the Federal
Reserve Board, but excluding any reserve included in the determination
of Earned Discount), special deposit or similar requirement against
assets of any Affected Party, deposits or obligations with or for the
account of any Affected Party or with or for the account of any
affiliate (or entity deemed by the Federal Reserve Board to be an
affiliate) of any Affected Party, or credit extended by any Affected
Party; or
(C) shall change the amount of capital maintained or required
or requested or directed to be maintained by any Affected Party; or
(D) shall impose any other condition affecting any Undivided
Interest owned or funded by any Affected Party, or its obligations or
rights, if any, to make Purchases or Reinvestments or to provide
funding therefor; or
(E) shall impose on any Affected Party any other expense
(including attorneys' fees and litigation costs);
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and the result of any of the foregoing is or would be:
(x) to increase the cost to (or in the case of Regulation D
referred to above, to impose a cost on) (I) an Affected Party funding
or making or maintaining any Purchases or Reinvestments, any purchases,
reinvestments, or loans or other extensions of credit under this
Agreement, the Enterprise Liquidity Agreement or Enterprise Credit
Support Agreement, as applicable or any commitment of such Affected
Party with respect to any of the foregoing, or (II) any Agent for
continuing its, or the Transferor's, or any Originator's relationship
with the Purchaser or any Bank Investor, as the case may be; or
(y) to reduce the amount of any sum received or receivable by
an Affected Party under this Agreement or the Certificate of
Assignments, or under the Enterprise Liquidity Agreement or the
Enterprise Credit Support Agreement with respect thereto; or
(z) in the sole determination of such Affected Party, to
reduce the rate of return on the capital of an Affected Party as a
consequence of its obligations hereunder or arising in connection
herewith to a level below that which such Affected Party could
otherwise have achieved, then within thirty days after demand by such
Affected Party (which demand shall be accompanied by a statement
setting forth the basis of such demand), the Transferor shall pay
directly to such Affected Party such additional amount or amounts as
will compensate such Affected Party for such additional or increased
cost or such reduction; PROVIDED THAT, such demand shall be made only
with regard to amounts accruing not more than six months prior to the
earlier of (x) such demand being made upon the Transferor and (y)
notification of the Transferor pursuant to PARAGRAPH (B) below.
(b) Each Affected Party will promptly notify the Transferor and the
Agent of any event of which it has knowledge which will entitle such Affected
Party to compensation pursuant to this SECTION 4.2; PROVIDED, HOWEVER, no
failure to give or delay in giving such notification shall adversely affect the
rights of any Affected Party to such compensation.
(c) In determining any amount provided for or referred to in this
SECTION 4.2, an Affected Party may use any reasonable averaging and attribution
methods that it (in its sole discretion) shall deem applicable. Any Affected
Party when making a claim under this SECTION 4.2 shall submit to the Transferor
a statement as to such increased cost or reduced return (including
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calculation thereof in reasonable detail), which statement shall, in the absence
of manifest error, be conclusive and binding upon the Transferor.
ARTICLE V
CONDITIONS OF PURCHASES
SECTION 5.1. CONDITIONS PRECEDENT TO INITIAL PURCHASE. The
initial Purchase hereunder is subject to the condition precedent that the Agent
shall have received, on or before the date of such Purchase, the following, each
(unless otherwise indicated) dated such date and in form and substance
satisfactory to the Agent:
(a) A Certificate of Assignment for the Agent on behalf of the
Purchaser, in substantially the form attached hereto as SCHEDULE
5.1(A);
(b) A copy of the resolutions of the Board of Directors of the
Transferor approving this Agreement, the Receivables Purchase
Agreement, the Certificate of Assignments and the other Agreement
Documents to be delivered by it hereunder and the transactions
contemplated hereby, certified by its Secretary or Assistant Secretary;
(c) a copy of the resolutions of the Board of Directors of
Wackenhut approving this Agreement, the Receivables Purchase Agreement,
the Purchase and Sale Agreement and the other Agreement Documents to be
delivered hereunder and thereunder, certified by its Secretary or
Assistant Secretary;
(d) a copy of the resolutions of each Originator approving the
Purchase and Sale Agreement and the other Agreement Documents to be
delivered hereunder and thereunder and as certified by the Secretary or
Assistant Secretary of each Originator;
(e) A Good Standing Certificate for the Transferor, Wackenhut
and each Originator issued by the Secretary of State or a similar
official of the Transferor's, the Servicer's and each Originator's
jurisdiction of incorporation and certificates of qualification as a
foreign corporation issued by the Secretaries of State or other similar
officials of each jurisdiction when such qualification is material to
the transactions contemplated by this Agreement, the Receivables
Purchase Agreement, the Purchase and Sale Agreement and
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the other Agreement Documents, in each case, dated a date reasonably
prior to such date;
(f) A certificate of the Secretary or Assistant Secretary of
each of the Transferor, Wackenhut and each Originator certifying the
names and true signatures of the officers authorized on its behalf to
sign this Agreement, the Purchase and Sale Agreement, the Receivables
Purchase Agreement, the Certificate of Assignments and the other
Agreement Documents to be delivered by them hereunder (on which
certificate the Agent, the Purchaser and each Bank Investor may
conclusively rely until such time as the Agent shall receive from the
Transferor, Wackenhut or the applicable Originator, as applicable, a
revised certificate meeting the requirements of this SUBSECTION (F));
(g) The Articles of Incorporation of each of the Transferor,
Wackenhut and each Originator, duly certified by the Secretary of
State or similar official of the jurisdiction of its organization, as
of a recent date acceptable to each Agent, together with a copy of the
By-laws of each of the Transferor, Wackenhut and each Originator, duly
certified by the Secretary or an Assistant Secretary of the Transferor,
Wackenhut and such Originator, as applicable;
(h) Acknowledgment copies of proper Financing Statements (Form
UCC-1 and in the case of clause (iv) below, Form UCC-3), filed on or
prior to the date of the initial Purchase, naming (i) each Originator
as debtor/seller, the Seller as secured party and the Transferor as
assignee and filed in connection with transactions contemplated by the
Purchase and Sale Agreement, (ii) the Seller as debtor/seller, the
Transferor as secured party and the Agent as assignee and filed in
connection with transactions contemplated by the Receivables Purchase
Agreement, (iii) the Transferor as the debtor/seller of Receivables or
an undivided interest therein and the Agent, on behalf of the
Purchaser and the Bank Investors, as the secured party/purchaser, and
(iv) the Transferor as assignor, and the Agent, on behalf of the
Purchaser and the Bank Investors, as assignee, of the security
interests evidenced by the financing statement(s) referred to in clause
(i) above, or other, similar instruments or documents, as may be
necessary or, in the opinion of the Agent, desirable under the UCC or
any comparable law of all appropriate jurisdictions to perfect the
Agent's interests in all Undivided Interests assigned to it on behalf
of the Purchaser or the Bank Investors or otherwise created or arising
hereunder;
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(i) A search report provided in writing to the Agent by LEXIS
Document Services, listing all effective financing statements that name
the Transferor, the Seller or any Originator as debtor and that are
filed in the jurisdictions in which filings were made pursuant to
SUBSECTION (H) above and in such other jurisdictions that the Agent
shall reasonably request, together with copies of such financing
statements (none of which shall cover any Receivables or Contracts or
interests therein or Collections or proceeds of any thereof);
(j) Duly executed copies of Lock-Box Agreements with each of
the Lock-Box Banks, in substantially the form attached hereto as
SCHEDULE 5.1(H);
(k) A favorable opinion of associate General Counsel for the
Transferor, Wackenhut, each Originator and Servicer, in substantially
the form of SCHEDULE 5.1(I);
(l) A favorable opinion of Akerman, Senterfitt & Xxxxxx,
P.A.,covering certain bankruptcy and insolvency matters in form and
substance satisfactory to Purchaser's counsel;
(m) Such sublicenses as the Agent shall require with regard to
all programs leased by the Transferor, Wackenhut, any Originator or
Servicer and used in the servicing of the Receivables Pool;
(n) Such powers of attorney as the Agent shall reasonably
request to enable the Agent to collect all amounts due under any and
all Pool Receivables;
(o) A Periodic Report as of the most recent Month End Date;
(p) Evidence (i) of the execution and delivery by Wackenhut
and each Originator of the Purchase and Sale Agreement (substantially
in the form attached hereto as SCHEDULE 5.1(P)(I)) and each other
Agreement Document to be executed and delivered in connection
therewith, (ii) of the execution and delivery by the Seller and the
Transferor of the Receivables Purchase Agreement (substantially in the
form attached hereto as SCHEDULE 5.1(P)(II)), and each other Agreement
Document to be executed and delivered in connection therewith, and
(iii) that each of the conditions precedent to the execution, delivery
and effectiveness of the Purchase and Sale Agreement and each other
Agreement Document has been satisfied;
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(q) Executed Letter Agreement (Segregation of Funds) of even
date herewith between Wackenhut Funding Corporation and NationsBank;
(r) A computer tape or disc containing such information
relating to each of the Pool Receivables the subject of the first
Purchase hereunder as is satisfactory to the Agent; and
(s) Evidence of the payment of all fees required to be paid
prior to closing.
SECTION 5.2. CONDITIONS PRECEDENT TO ALL PURCHASES AND
REINVESTMENTS. Each Purchase (including the initial Purchase) and each
Reinvestment hereunder shall be subject to the further conditions precedent
("CONDITIONS PRECEDENT") that on the date of such Purchase or Reinvestment the
following statements shall be true (and the Transferor by accepting the amount
of such Purchase or by receiving the proceeds of such Reinvestment shall be
deemed to have certified that):
(a) the representations and warranties contained in SECTION
6.1 and SECTION 6.2 and in the Purchase and Sale Agreement and in the
Receivables Purchase Agreement are correct in all material respects on
and as of such day as though made on and as of such day and shall be
deemed to have been made on such day except for those representations
and warranties made solely with respect to an earlier date which shall
be correct in all material respects as of such date;
(b) no event has occurred and is continuing, or would result
from such Purchase or Reinvestment, that constitutes a Termination
Event or Unmatured Termination Event;
(c) after giving effect to each proposed Purchase or
Reinvestment, (i) Aggregate Purchaser's Investments will not exceed the
Purchase Limit, and (ii) Aggregate Required Allocations will not exceed
the Required Allocations Limit and (iii) the sum of the Aggregate
Purchaser's Investment plus the Interest Component of all outstanding
Related Commercial Paper would not exceed the Facility Limit; and
(d) the Commitment Termination Date shall not have occurred;
PROVIDED, HOWEVER, the absence of the occurrence and continuance of an Unmatured
Termination Event shall not be a Condition Precedent to any reinvestment being
made with the proceeds of
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Collections that were, on the same day, applied in reduction of the Aggregate
Total Investments.
SECTION 5.3. ADDITIONAL CONDITION PRECEDENT TO PURCHASES. Each
Purchase (including the initial Purchase) shall be subject to the further
condition precedent that the Purchase Termination Date shall not have occurred.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.1. REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR.
The Transferor represents and warrants as follows:
(a) ORGANIZATION AND GOOD STANDING. The Transferor has been
duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such
properties are presently owned and such business is presently
conducted, and had at all relevant times, and now has, all necessary
power, authority, and legal right to acquire and own the Pool
Receivables.
(b) DUE QUALIFICATION. The Transferor is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in all jurisdictions in which the
ownership or lease of property or the conduct of its business
requires such qualification, licenses or approvals.
(c) POWER AND AUTHORITY; DUE AUTHORIZATION. The Transferor (i)
has all necessary power, authority and legal right to (A) execute and
deliver this Agreement, the Certificate of Assignments and other
Agreement Documents to which it is a party, (B) carry out the terms of
the Agreement Documents, and (C) sell and assign undivided Interest on
the terms and conditions herein provided and (ii) has duly authorized
by all necessary corporate action the execution, delivery and
performance of this Agreement and the other Agreement Documents to
which it is a party and the sale and assignment of the Undivided
Interests on the terms and conditions herein provided.
(d) VALID SALE; BINDING OBLIGATIONS. This Agreement
constitutes a valid sale, transfer, and assignment of Undivided
Interests to the Agent, on behalf of the Purchaser or the Bank
Investors, as the case may be,
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enforceable against creditors of, and purchasers from, the Transferor;
and this Agreement constitutes, and each other Agreement Document to be
signed by the Transferor when duly executed and delivered will
constitute, a legal, valid and binding obligation of the Transferor
enforceable in accordance with its terms, except as enforceability may
be limited by bankruptcy, insolvency, reorganization, or other similar
laws affecting the enforcement of creditors, rights generally and by
general principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law.
(e) NO VIOLATION. The consummation of the transactions
contemplated by this Agreement and the other Agreement Documents and
the fulfillment of the terms hereof will not (i) conflict with, result
in any breach of any of the terms and provisions of, or constitute
(with or without notice or lapse of time or both) a default under, the
articles of incorporation or by-laws of the Transferor, or any
indenture, loan agreement, receivables purchase agreement, mortgage,
deed of trust, or other agreement or instrument to which the Transferor
is a party or by which it or any of its properties is bound, (ii)
result in the creation or imposition of any Adverse Claim upon any of
the Transferor's properties pursuant to the terms of any such
indenture, loan agreement, receivables purchase agreement, mortgage,
deed of trust, or other agreement or instrument, other than this
Agreement and the Certificate of Assignments, or (iii) violate any law
or order, rule, or regulation applicable to the Transferor of any court
or of any federal or state regulatory body, administrative agency, or
other governmental instrumentality having jurisdiction over the
Transferor or any of its properties.
(f) NO PROCEEDINGS. There are no proceedings or investigations
pending, or to its knowledge threatened, before any court, regulatory
body, administrative agency, or other tribunal or governmental
instrumentality (i) asserting the invalidity of this Agreement, the
Certificate of Assignments or any other Agreement Documents, (ii)
seeking to prevent the sale and assignment of any Undivided Interest,
the issuance of the Certificate of Assignments or the consummation of
any of the other transactions contemplated by this Agreement or any
other Agreement Document, (iii) seeking any determination or ruling
that might materially and adversely affect (A) the performance by the
Transferor or Servicer of its obligations under this Agreement, or (B)
the validity or enforceability of this Agreement,
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the Certificate of Assignments, any other Agreement Document, the
Receivables or the Contracts or (iv) seeking to adversely affect the
federal income tax attributes of the Purchases hereunder or the
Certificate of Assignments.
(g) NOT AN INVESTMENT COMPANY. The Transferor is not, and is
not controlled by, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or is exempt from all
provisions of such Act.
(h) BULK SALES ACT. No transaction contemplated hereby
requires compliance with any bulk sales act or similar law.
(i) GOVERNMENT APPROVALS. No authorization or approval or
other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for the due execution,
delivery and performance by the Transferor of this Agreement, the
Certificate of Assignments or any other Agreement Document, EXCEPT for
the filing of the UCC Financing Statements referred to in ARTICLE V,
all of which, at the time required in ARTICLE V, shall have been duly
made and shall be in full force and effect.
(j) LITIGATION. No injunction, decree or other decision has
been issued or made by any court, governmental agency or
instrumentality thereof that prevents, and to its knowledge no threat
by any person has been made to attempt to obtain any such decision that
would prevent, the Transferor from conducting a significant part of its
business operations, except as described in SCHEDULE 6.1(J).
(k) MARGIN REGULATIONS. The use of all funds obtained by the
Transferor under this Agreement will not conflict with or contravene
any of Regulations G, T, U and X promulgated by the Board of Governors
of the Federal Reserve System from time to time.
(l) QUALITY OF TITLE. Each Pool Receivable, together with the
related Contract and all purchase orders and other agreements related
to such Pool Receivable, is owned by the Transferor free and clear of
any Adverse Claim (other than any Adverse Claim arising solely as the
result of any action taken by the Purchaser or any Bank Investor, as
the case may be (or any assignee thereof) or by the Agent) and
restriction on assignment, except as provided herein; when the
Purchaser or any Bank Investor, as the case may be, makes a Purchase,
it or they or the Agent shall have acquired
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and shall continue to have maintained a valid and perfected first
priority undivided percentage ownership interest to the extent of its
Undivided Interest in each Pool Receivable and in the Related Security
and Collections with respect thereto, free and clear of any Adverse
Claim (other than any Adverse Claim arising solely as the result of any
action taken by the Purchaser or any Bank Investor (or any assignee
thereof) or by the Agent) except as provided hereunder; and no
effective financing statement or other instrument similar in effect
covering any Pool Receivable, any interest therein, the Related
Security or Collections with respect thereto is on file in any
recording office except such as may be filed (i) in favor of the
Transferor in accordance with the Contracts, (ii) in favor of the
Purchaser or any Bank Investor or the Agent in accordance with this
Agreement or in connection with any Adverse Claim arising solely as the
result of any action taken by the Purchaser or any Bank Investor (or
any assignee thereof) or by the Agent; or (iii) in favor of
NationsBank, or any successor, as described in SECTION 11.1.
(m) ACCURATE REPORTS. No Periodic Report (if prepared by the
Transferor, or to the extent that information contained therein was
supplied by the Transferor), information, Exhibit, financial statement,
document, book, record or report furnished or to be furnished by the
Transferor to the Agent or the Purchaser or any Bank Investor in
connection with this Agreement was or will be inaccurate in any
material respect as of the date it was or will be dated or (except as
otherwise disclosed to the Agent, the Purchaser or any Bank Investor,
as the case may be, at such time) as of the date so furnished, or
contained or will contain any material misstatement of fact or omitted
or will omit to state a material fact or any fact necessary to make the
statements contained therein not materially misleading.
(n) OFFICES. The chief place of business and chief executive
office of the Transferor are located at the address of the Transferor
referred to in SECTION 13.2, and the offices where the Transferor keeps
all of its books, records, and documents evidencing Pool Receivables,
the related Contracts and all purchase orders and other agreements
related to such Pool Receivables are located at the addresses
specified in SCHEDULE 6.1(N) (or at such other locations, notified to
the Agents in accordance with SECTION 7.1(F), in jurisdictions where
all action required by SECTION 8.5 has been taken and completed).
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(o) LOCK-BOX ACCOUNTS. The names and addresses of all the
Lock-Box Banks, together with the account numbers of the lock-box
accounts of the Transferor or Servicer at such Lock-Box Banks, are
specified in SCHEDULE 6.1(O) (or have been notified to the Agents in
accordance with SECTION 7.3(D)).
(p) ELIGIBLE RECEIVABLES. Each Receivable included in the Net
Pool Balance as an Eligible Receivable on the date of any Purchase or
Reinvestment shall be an Eligible Receivable on such date.
(q) SERVICING PROGRAMS. Any and all programs used by the
Transferor or the Servicer in the servicing of the Receivables Pool are
owned by the Transferor or the Servicer, as applicable, and not leased
or licensed.
(r) TRANSFERS. No purchase of an interest in Receivables by
the Purchaser or a Bank Investor from the Transferor or by the
Transferor from Wackenhut constitutes a fraudulent transfer or
fraudulent conveyance or is otherwise void or voidable under similar
laws or principles, the doctrine of equitable subordination or for any
other reason.
(s) PURCHASE AND SALE AGREEMENT. Each of the representations
and warranties made by each Originator in the Purchase and Sale
Agreement and by The Wackenhut Corporation in the Receivables Purchase
Agreement are true and correct in all material respects as of the date
or dates made.
(t) SOLVENCY. Immediately after giving effect to the
Transferor's, the Seller's and the Originator's obligations now or
hereafter arising pursuant to any Agreement Document and to each
transaction contemplated thereby, the Transferor, the Seller and each
Originator will each be Solvent.
(u) USE OF PROCEEDS. Neither the Transferor nor any Originator
will use the proceeds of the Purchases hereunder to acquire a security
in a transaction subject to Section 13 or 14 of the Securities
Exchange Act of 1934, as amended.
(v) TAX. The Transferor has filed each and every tax return
required to be filed by it in each jurisdiction in which it is
required to do so and has paid in each such jurisdiction all taxes
required to be paid by it on a consolidated basis.
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(w) TRADENAMES, ETC. As of the date hereof: (A) the
Transferor's chief executive office is located at the address set forth
under its signature to this Agreement; and (B) the Transferor has,
within the last five (5) years, used only the tradenames identified in
EXHIBIT 6.1(W) hereto, and, within the last five (5) years, has not
changed its name, merged with or into or consolidated with any other
corporation or been the subject of any proceeding under Xxxxx 00,
Xxxxxx Xxxxxx Code (Bankruptcy).
(x) NO TERMINATION EVENT. No event has occurred and is
continuing and no condition exists which constitutes a Termination
Event or an Unmatured Termination Event.
(y) ERISA. The Transferor is in compliance in all material
respects with ERISA and there exists no lien in favor of the Pension
Benefit Guaranty Corporation on any of the Receivables.
SECTION 6.2. REPRESENTATIONS AND WARRANTIES OF THE SERVICER.
The Servicer, represents and warrants to the Purchaser and to the Bank Investors
that:
(a) ORGANIZATION AND GOOD STANDING. Servicer has been duly
organized and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its organization, with power and
authority to own its properties and to conduct its business as such
properties are presently owned and such business is presently
conducted, and had at all relevant times, and now has, all necessary
power, authority, and legal right to acquire, own and sell the Pool
Receivables.
(b) DUE QUALIFICATION. Servicer is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in all jurisdictions in which the
ownership or lease of property or the conduct of its business requires
such qualification, licenses or approvals.
(c) POWER AND AUTHORITY; DUE AUTHORIZATION. Servicer (i) has
all necessary power, authority and legal right to (A) execute and
deliver this Agreement, the Receivables Purchase Agreement and the
Purchase and Sale Agreement and other Agreement Documents, (B) carry
out the terms of the Agreement Documents to which it is a party, and
(C) sell and assign the Receivables to the Transferor pursuant to the
Receivables Purchase Agreement on the terms and conditions therein
provided and (ii) has duly authorized by all necessary corporate
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action the execution, delivery and performance of this Agreement, the
Receivables Purchase Agreement, the Purchase and Sale Agreement and the
other Agreement Documents to which it is a party and the sale and
assignment of the Receivables to the Transferor pursuant to the
Receivables Purchase Agreement on the terms and conditions therein
provided.
(d) VALID SALE; BINDING OBLIGATIONS. The Receivables Purchase
Agreement constitutes a valid sale, transfer, and assignment of the
Receivables to the Transferor, enforceable against creditors of, and
purchasers from, Wackenhut; and this Agreement constitutes, and each
other Agreement Document to be signed by Wackenhut (in whatever
capacity) when duly executed and delivered will constitute, a legal,
valid and binding obligation of Wackenhut enforceable in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, or other similar laws affecting the
enforcement of creditors, rights generally and by general principles
of equity, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(e) NO VIOLATION. The consummation of the transactions
contemplated by this Agreement and the other Agreement Documents and
the fulfillment of the terms hereof will not (i) conflict with, result
in any breach of any of the terms and provisions of, or constitute
(with or without notice or lapse of time or both) a default under, its
articles of incorporation or by-laws, or any indenture, loan agreement,
receivables purchase agreement, mortgage, deed of trust, or other
agreement or instrument to which it is a party or by which it or any of
its properties is bound, (ii) result in the creation or imposition of
any Adverse Claim upon any of its properties pursuant to the terms of
any such indenture, loan agreement, receivables purchase agreement,
mortgage, deed of trust, or other agreement or instrument, other than
the Receivables Purchase Agreement and this Agreement, or (iii)
violate any law or order, rule, or regulation applicable to it of any
court or of any federal or state regulatory body, administrative
agency, or other governmental instrumentality having jurisdiction over
Wackenhut or any of its properties.
(f) NO PROCEEDINGS. There are no proceedings or investigations
pending, or to its knowledge threatened, before any court, regulatory
body, administrative agency, or other tribunal or governmental
instrumentality (i) asserting the invalidity of this Agreement, the
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Receivables Purchase Agreement, the Purchase and Sale Agreement or any
other Agreement Documents, (ii) seeking to prevent the sale and
assignment of the Receivables to the Transferor pursuant to the
Receivables Purchase Agreement or the consummation of any of the other
transactions contemplated by this Agreement or any other Agreement
Document, (iii) seeking any determination or ruling that might
materially and adversely affect (A) the performance by it (in whatever
capacity) of its obligations under this Agreement, the Receivables
Purchase Agreement or any other Agreement Document to which it is a
party, or (B) the validity or enforceability of this Agreement, the
Receivables Purchase Agreement, any other Agreement Document, the
Receivables or the Contracts or (iv) seeking to adversely affect the
federal income tax attributes of the Purchases hereunder or the
Certificate of Assignments.
(g) GOVERNMENT APPROVALS. No authorization or approval or
other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for the due execution,
delivery and performance by Wackenhut of this Agreement, the
Receivables Purchase Agreement or any other Agreement Document, EXCEPT
for the filing of the UCC Financing Statements referred to in ARTICLE
V, all of which, at the time required in ARTICLE V, shall have been
duly made and shall be in full force and effect.
(h) FINANCIAL CONDITION. (x) The consolidated balance sheets
of the Servicer and its consolidated subsidiaries as at September 30,
1997, and the related statements of income and shareholders, equity of
it and its consolidated subsidiaries for the fiscal year then ended,
copies of which have been furnished to the Agent, fairly present the
consolidated financial condition, business, business prospects and
operations of it and its consolidated subsidiaries as at such date and
the consolidated results of the operations of it and its consolidated
subsidiaries for the period ended on such date all in accordance with
generally accepted accounting principles consistently applied, and (y)
since September 30, 1997 there has been no material adverse change in
any such condition, business, business prospects or operations except
as described in SCHEDULE 6.2(H).
(i) CREDIT AND COLLECTION POLICY. Since January 5, 1995, there
have been no material changes in the Credit and Collection Policy other
than as permitted hereunder. Since such date, no material adverse
change has occurred in the overall rate of collection of the
Receivables.
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(j) COLLECTIONS AND SERVICING. Since January 5, 1995, there
has been no material adverse change in the ability of the Servicer to
service and collect the Receivables.
(k) NOT AN INVESTMENT COMPANY. The Servicer is not, and is not
controlled by, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or is exempt from all
provisions of such Act.
(l) LITIGATION. No injunction, decree or other decision has
been issued or made by any court, governmental agency or
instrumentality thereof that prevents, and to its knowledge no threat
by any person has been made to attempt to obtain any such decision that
would prevent, it from conducting a significant part of its business
operations, except as described in SCHEDULE 6.2(I).
(m) ACCURATE REPORTS. No Periodic Report (if prepared by it,
or to the extent that information contained therein was supplied by
it), information, Exhibit, financial statement, document, book, record
or report furnished or to be furnished by it to the Agent or the
Purchaser or any Bank Investor in connection with this Agreement was or
will be inaccurate in any material respect as of the date it was or
will be dated or (except as otherwise disclosed to the Agent, the
Purchaser or any Bank Investor, as the case may be, at such time) as of
the date so furnished, or contained or will contain any material
misstatement of fact or omitted or will omit to state a material fact
or any fact necessary to make the statements contained therein not
materially misleading.
(n) OFFICES. The chief place of business and chief executive
office of the Servicer are located at its address referred to in
SECTION 13.2, and the offices where the Servicer keeps all of its
books, records, and documents evidencing Pool Receivables, the related
Contracts and all purchase orders and other agreements related to such
Pool Receivables are located at the addresses specified in SCHEDULE
6.2(N) (or at such other locations, notified to the Agent in accordance
with SECTION 7.1(F), in jurisdictions where all action required by
SECTION 8.5 has been taken and completed).
(o) LOCK-BOX ACCOUNTS. The names and addresses of all the
Lock-Box Banks, together with the account numbers of the lock-box
accounts of the Servicer at such Lock-Box Banks, are specified in
SCHEDULE 6.2(O)
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(or have been notified to the Agent in accordance with
SECTION 7.3(D)).
(p) SERVICING PROGRAMS. Any and all programs used by the
Servicer in the servicing of the Receivables Pool are owned by it and
not leased or licensed.
(q) NO TERMINATION EVENT. No event has occurred and is
continuing and no condition exists which constitutes a Termination
Event or an Unmatured Termination Event.
ARTICLE VII
GENERAL COVENANTS OF THE TRANSFEROR AND SERVICER
SECTION 7.1. AFFIRMATIVE COVENANTS OF THE TRANSFEROR. From the
date hereof until the date, following the Commitment Termination Date, on which
all Undivided Interests shall be reduced to zero, the Transferor will, unless
the Agent shall otherwise consent in writing:
(a) COMPLIANCE WITH LAWS, ETC. Comply in all material respects
with all applicable laws, rules, regulations and orders with respect to
the Pool Receivables and related Contracts.
(b) PRESERVATION OF CORPORATE EXISTENCE. Preserve and
maintain its corporate existence, rights, franchises and privileges in
the jurisdiction of its incorporation, and qualify and remain qualified
in good standing as a foreign corporation in each jurisdiction where
the failure to preserve and maintain such existence, rights,
franchises, privileges and qualification would materially adversely
affect (i) the interests of the Agent, the Purchaser or any Bank
Investor hereunder or (ii) the ability of the Transferor or Servicer to
perform their respective obligations hereunder.
(c) FIELD REVIEWS. (i) At any time and from time to time
during regular business hours, permit the Agent, or its agents or
representatives, (A) to examine and make copies of and abstracts from
all books, records and documents (including, without limitation,
computer tapes and disks) in the possession or under the control of the
Transferor relating to Pool Receivables, including, without limitation,
the related Contracts and purchase orders and other agreements, and (B)
to visit the offices and properties of the Transferor for the purpose
of examining such materials described in CLAUSE (I)(A) next above, and
to discuss
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matters relating to Pool Receivables or the Transferor's performance
hereunder with any of the officers or employees of the Transferor
having knowledge of such matters; and (ii) without limiting the
provisions of CLAUSE (I)(A) next above, from time to time on request of
the Agent, permit Coopers & Xxxxxxx or other certified public
accountants or other auditors reasonably acceptable to the Agent to
conduct, at the Transferor's expense, a review of the Transferor's
books and records with respect to the Pool Receivables.
(d) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing Pool Receivables
in the event of the destruction of the originals thereof), and keep and
maintain, all documents, books, records and other information
reasonably necessary or advisable for the collection of all Pool
Receivables (including, without limitation, records adequate to permit
the daily identification of each new Pool Receivable and all
Collections of and adjustments to each existing Pool Receivable); such
records to be retained by Servicer for such periods as are usual and
customary and in accordance with the Credit and Collection Policy.
(e) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS.
At its expense timely and fully perform and comply with all material
provisions, covenants and other promises required to be observed by it
under the Contracts related to the Pool Receivables and all purchase
orders and other agreements related to such Pool Receivables.
(f) LOCATION OF RECORDS. Keep its chief place of business and
chief executive office, and the offices where it keeps its records
concerning the Pool Receivables, all related Contracts and all
purchase orders and other agreements related to such Pool Receivables
(and all original documents relating thereto), at the addresses) of the
Transferor referred to in SECTION 6.1(N) or, upon 30 days' prior
written notice to each Agent, at such other locations in jurisdictions
where all action required by SECTION 8.5 shall have been taken and
completed.
(g) CREDIT AND COLLECTION POLICIES. Comply in all material
respects with the Credit and Collection Policy in regard to each Pool
Receivable and the related Contract.
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(h) MINIMUM NET WORTH. The Transferor shall at all
times maintain a minimum Net Worth of not less than 10% of
the Net Pool Balance;
(i) COLLECTIONS. Instruct all Obligors to cause all
Collections of Pool Receivables to be deposited directly with a
Lock-Box Bank.
(j) SALE TREATMENT. The Transferor will not account for
(including for accounting and tax purposes), or otherwise treat, the
transactions contemplated by the Receivables Purchase Agreement in any
manner other than as a sale of Receivables by the Seller to the
Transferor. In addition, the Transferor shall disclose (in a footnote
or otherwise) in all of its financial statements (including any such
financial statements consolidated with any other Persons' financial
statements) the existence and nature of the Transaction contemplated
hereby and by the Receivables Purchase Agreement and the interest of
the Agent, on behalf of the Company and the Bank Investors, in the
Receivables.
(k) SEPARATE BUSINESS. The Transferor shall at all times (a)
to the extent the Transferor's office is located in the offices of
Wackenhut or any Affiliate of Wackenhut, pay fair market rent for its
executive office space located in the offices of Wackenhut or any
Affiliate of Wackenhut, (b) have at all times at least two members of
its board of directors which are not and have never been employees,
officers or directors of Wackenhut or any Affiliate of Wackenhut or of
any major creditor of Wackenhut or any Affiliate of Wackenhut and are
persons who are familiar and have experience with asset securitization,
(c) maintain the Transferor's books, financial statements, accounting
records and other corporate documents and records separate from those
of Wackenhut or any other entity, (d) not commingle the Transferor's
assets with those of Wackenhut or any other entity, (e) not sell,
exchange or otherwise convey any of its assets in any inter-company
transactions except for fair market value in an arms length transaction
approved by a majority of its board of directors (including Independent
Directors, as defined in the Transferor's "Certificate of
Incorporation"), (f) act solely in its corporate name and through its
own authorized officers and agents, (g) make investments directly or by
brokers engaged and paid by the Transferor or its agents (provided that
if any such agent is an Affiliate of the Transferor it shall be
compensated at a fair market rate for its services), (h) separately
manage the Transferor's liabilities from those of Wackenhut or any
Affiliates of Wackenhut and pay its own liabilities, including all
administrative expenses, from its own separate assets, except that
Wackenhut may pay the organizational expenses of the Transferor, and
(i) pay from the Transferor's
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assets all obligations and indebtedness of any kind incurred by the
Transferor. The Transferor shall abide by all corporate formalities,
including the maintenance of current minute books, and the Transferor
shall cause its financial statements to be prepared in accordance with
generally accepted accounting principles in a manner that indicates the
separate existence of the Transferor and its assets and liabilities.
The Transferor shall (i) pay all its liabilities, (ii) not assume the
liabilities of Wackenhut or any Affiliate of Wackenhut, (iii) not lend
funds or extend credit to Wackenhut or any affiliate of Wackenhut
except pursuant to the Receivables Purchase Agreement in connection
with the purchase of Receivables thereunder and (iv) not guarantee the
liabilities of Wackenhut or any Affiliates of Wackenhut. The officers
and directors of the Transferor (as appropriate) shall make decisions
with respect to the business and daily operations of the Transferor
independent of and not dictated by any controlling entity. The
Transferor shall not engage in any business not permitted by its
Certificate of Incorporation as in effect on the Closing Date.
(l) CORPORATE DOCUMENTS. The Transferor shall only amend,
alter, change or repeal Articles of its Certificate of Incorporation
with the prior written consent of the Agent.
(m) RIGHTS UNDER RECEIVABLES PURCHASE AGREEMENT. Exercise all
of its rights under or in connection with the Receivables Purchase
Agreement to the fullest extent thereof except to the extent otherwise
consented to in writing by the Agent.
SECTION 7.2. REPORTING REQUIREMENTS OF THE TRANSFEROR. From
the date hereof until the date, following the Commitment Termination Date, on
which all Undivided Interests shall be reduced to zero and all other amounts
owing hereunder shall have been paid, the Transferor will, unless the Agent
shall otherwise consent in writing, furnish to the Agent:
(a) FINANCIAL REPORTING. The Transferor will maintain, or
cause to be maintained, a system of accounting established and
administered in accordance with GAAP, and furnish to the Agent:
(i) QUARTERLY FINANCIAL STATEMENTS. As soon as
available and in any event within 45 days after the end of
each of the first three quarters of each fiscal year of the
Transferor, copies of the Transferor's quarterly financial
reports, certified by the vice president and treasurer, chief
financial officer or chief accounting officer of the
Transferor; together with a certificate
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from such officer certifying that no Termination Event or
Unmatured Termination Event has occurred and containing a
computation of, and showing compliance with, the financial
restrictions contained in SECTION 7;
(ii) ANNUAL REPORTING. Within ninety (90) days after
the close of the Transferor's fiscal year, financial
statements, prepared in accordance with GAAP for the
Transferor, including balance sheets as of the end of such
period, related statements of operations, shareholder's equity
and cash flows, and reviewed by a nationally recognized
accounting firm reasonably acceptable to the Agent and
accompanied by a certificate of said accountants that, in the
course of the foregoing, they have obtained no knowledge of
any Termination Event or Unmatured Termination Event, or if,
in the opinion of such accountants, any Termination Event or
Unmatured Termination Event shall exist, stating the nature
and status thereof.
(iii) COMPLIANCE CERTIFICATE. Within forty-five (45)
days after the close of the first three quarterly periods of
the Transferor's fiscal year and together with the financial
statements required hereunder, a compliance certificate signed
by the Transferor's chief financial officer stating that to
the best of such Person's knowledge, no Termination Event or
Unmatured Termination Event exists, or if any Termination
Event or Unmatured Termination Event exists, stating the
nature and status thereof.
(iv) SHAREHOLDERS STATEMENTS AND REPORTS. Promptly
upon the furnishing thereof to the shareholders of or the
Transferor, copies of all financial statements, reports and
proxy statements so furnished.
(b) REPORTS TO HOLDERS AND EXCHANGES. In addition to the
reports required by SUBSECTION (A) next above, promptly upon the
Agent's request, copies of any reports specified in such request which
the Transferor sends to any of its security holders, and any reports
or registration statements that Servicer files with the Securities and
Exchange Commission or any national securities exchange other than
regis tration statements relating to employee benefit plans and to
registrations of securities for selling security holders;
(c) ERISA. Promptly after the filing or receiving thereof,
copies of all reports and notices with respect to any Reportable Event
defined in Article IV of ERISA which the Transferor, the Seller or any
Originator files under ERISA with the Internal Revenue Service, the
Pension Benefit Guaranty Corporation or the U.S. Department of Labor or
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which the Transferor, the Seller or any Originator receives
from the Pension Benefit Guaranty Corporation;
(d) TERMINATION EVENTS. As soon as possible and in any event
within five days after the occurrence of each Termination Event and
each Unmatured Termination Event, written statement of the vice
president and treasurer, chief financial officer or chief accounting
officer of the Transferor setting forth details of such Event and the
action that the Transferor proposes to take with respect thereto;
(e) LITIGATION. As soon as possible and in any event within
three Business Days of the Transferor's knowledge thereof, notice of
(i) any litigation, investigation or proceeding which may exist at any
time which could have a material adverse effect on the business,
operations, property or financial condition of the Transferor, the
Seller or any Originator or impair the ability of the Transferor or the
Servicer to perform its obligations under this Agreement and (ii) any
material adverse development in previously disclosed litigation;
(f) PURCHASE AND SALE AGREEMENT/RECEIVABLES PURCHASE
AGREEMENT. Promptly after receipt thereof, copies of all
documents and other information delivered by either of the
Originator or the Seller to the Transferor pursuant to
either the Purchase and Sale Agreement or the Receivables
Purchase Agreement; and
(g) OTHER. Promptly, from time to time, such other information
(including a listing by Obligor of all Pool Receivables), documents,
records or reports respecting the Receivables or the condition or
operations, financial or otherwise, of the Transferor as the Agent may
from time to time reasonably request in order to protect the interests
of the Agent or any Purchaser under or as contemplated by this
Agreement.
SECTION 7.3. NEGATIVE COVENANTS OF THE TRANSFEROR. From the
date hereof until the date, following the Commitment Termination Date, on which
all Undivided Interests shall be reduced to zero and all other amounts owing
hereunder shall have been paid, the Transferor will not, without the prior
written consent of the Agent:
(a) SALES, LIENS, ETC. Except as otherwise provided herein,
sell, assign (by operation of law or otherwise) or otherwise dispose
of, or create or suffer to exist any Adverse Claim upon or with respect
to, any Pool Receivable or related Contract or Related Security, or any
interest therein, or any lock-box account to which any Collections of
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any Pool Receivable are sent, or any right to receive income
from or in respect of any of the foregoing.
(b) EXTENSION OR AMENDMENT OF RECEIVABLES. Except as otherwise
permitted in SECTION 8.2, extend, amend or otherwise modify the terms
of any Pool Receivable, or amend, modify or waive any term or condition
of any Contract related thereto unless such extension, amendment or
modification (i) does not conflict with the Credit and Collection
Policy and (ii) does not affect the collectibility of the related
Receivable.
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. Make
any change in the character of its business or in the Credit and
Collection Policy.
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS. Add or
terminate any bank as a Lock-Box Bank from those listed in SCHEDULE
6.2(O) or make any change in its instructions to Obligors regarding
payments to be made to Servicer or Servicer or payments to be made to
any Lock-Box Bank, unless the Agent shall have received notice of such
addition, termination or change and duly executed copies of Lock-Box
Agreements with each new Lock-Box Bank in a form satisfactory to the
Agent.
(e) AMENDMENTS TO PURCHASE AND SALE AGREEMENT/RECEIVABLES
PURCHASE AGREEMENT. Amend, supplement, waive the application of any
provision of, amend and restate or otherwise modify the Purchase and
Sale Agreement or the Receivables Purchase Agreement except in each
case (i) in accordance with the terms thereof and (ii) with the prior
written consent of the Agent.
(f) CORPORATE IDENTITY. At any time change its name, identity,
corporate structure or location unless at least 10 days prior thereto
the Transferor shall have delivered to the Agent UCC financing
statements or other statements amending or otherwise modifying UCC
financing statements filed hereunder in order to maintain a first
perfected ownership interest in favor of the Agent on behalf of the
Purchaser and the Bank Investors hereunder.
SECTION 7.4. AFFIRMATIVE COVENANTS OF SERVICER. From the date
hereof until the date, following the Commitment Termination Date, on which all
Undivided Interests shall be reduced to zero, Servicer will, unless the Agent
shall otherwise consent in writing:
(a) COMPLIANCE WITH LAWS, ETC. Comply in all material respects
with all applicable laws, rules,
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regulations and orders with respect to the Pool Receivables and related
Contracts.
(b) PRESERVATION OF CORPORATE EXISTENCE. Preserve and
maintain its corporate existence, rights, franchises and privileges in
the jurisdiction of its incorporation, and qualify and remain qualified
in good standing as a foreign corporation in each jurisdiction where
the failure to preserve and maintain such existence, rights,
franchises, privileges and qualification would materially adversely
affect (i) the interests of the Agent or the Purchaser or any Bank
Investor hereunder or (ii) the ability of Servicer or the Transferor
to perform their respective obligations hereunder or under the
Receivable Purchase Agreement.
(c) DUE DILIGENCE. Servicer shall permit the Agent and its
authorized representatives to make, or cause to be made, on or prior to
March 31, 1998, such reasonable investigation and physical inspections
of the Servicer, its servicing facilities and its financial and legal
condition as the Agent deems necessary or advisable. In connection with
such inspection, the Servicer shall further permit the Agent and its
authorized representatives (including legal counsel and independent
accountants) upon reasonable notice to have full access to the
properties, assets, personnel (including the Servicer's accountants)
and its relevant books and records during reasonable business hours,
and the Servicer will furnish the Agent and/or such representatives
with such financial and operating data and other information and copies
of documents with respect to the Receivables, and the servicing and the
servicing operations of the Servicer as the Agent and/or such
representatives shall from time to time reasonably request.
(d) FIELD REVIEWS. (i) At any time and from time to time
during regular business hours, permit the Agent, or its agents or
representatives, (A) to examine and make copies of and abstracts from
all books, records and documents (including, without limitation,
computer tapes and disks) in the possession or under the control of
Servicer relating to Pool Receivables, including, without limitation,
the related Contracts and purchase orders and other agreements, and (B)
to visit the offices and properties of Servicer for the purpose of
examining such materials described in CLAUSE (I)(A) next above, and to
discuss matters relating to Pool Receivables or Servicer's performance
hereunder with any of the officers or employees of Servicer having
knowledge of such matters; and (ii) without limiting the provisions of
CLAUSE (I)(A) next above, from time to time on request of the Agent,
permit
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Coopers & Xxxxxxx or other certified public accountants or other
auditors acceptable to the Agent to conduct, at Servicer's expense, a
review of Servicer's books and records with respect to the Pool
Receivables.
(e) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing Pool Receivables
in the event of the destruction of the originals thereof), and keep and
maintain, all documents, books, records and other information
reasonably necessary or advisable for the collection of all Pool
Receivables (including, without limitation, records adequate to permit
the daily identification of each new Pool Receivable and all
Collections of and adjustments to each existing Pool Receivable); such
records to be retained by Servicer for such periods as are usual and
customary and in accordance with the Credit and Collection Policy.
(f) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS.
At its expense timely and fully perform and comply with all material
provisions, covenants and other promises required to be observed by it
under the Contracts related to the Pool Receivables and all purchase
orders and other agreements related to such Pool Receivables.
(g) LOCATION OF RECORDS. Keep its chief place of business and
chief executive office, and the offices where it keeps its records
concerning the Pool Receivables, all related Contracts and all
purchase orders and other agreements related to such Pool Receivables
(and all original documents relating thereto), at the addresses) of
Servicer referred to in SECTION 6.2(N) or, upon 30 days' prior written
notice to each Agent, at such other locations in jurisdictions where
all action required by SECTION 8.5 shall have been taken and completed.
(h) CREDIT AND COLLECTION POLICIES. Comply in all material
respects with the Credit and Collection Policy in regard to each Pool
Receivable and the related Contract.
(i) COLLECTIONS. Instruct all Obligors to cause all
Collections of Pool Receivables to be deposited directly with a
Lock-Box Bank.
SECTION 7.5. REPORTING REQUIREMENTS OF SERVICER. From the date
hereof until the date, following the Commitment Termination
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Date, on which all Undivided Interests shall be reduced to zero and all
other amounts owing hereunder shall have been paid, the Servicer will, unless
the Agent shall otherwise consent in writing, furnish to the Agent:
(a) QUARTERLY FINANCIAL STATEMENTS. As soon as available and
in any event within 45 days after the end of each of the first three
quarters of each fiscal year of the Servicer, copies of the Servicer
quarterly financial reports, on Form 10-Q, as filed with the
Securities and Exchange Commission (or if the Servicer is no longer
required to file such Form 10-Q, the Servicer shall furnish such
financial reports containing the information typically found on Form
10-Q, certified by the vice president and treasurer, chief financial
officer or chief accounting officer of the Servicer; together with a
certificate from such officer certifying that no Termination Event or
Unmatured Termination Event has occurred and containing a computation
of, and showing compliance with, the financial restrictions con tained
in SECTION 7.6;
(b) ANNUAL FINANCIAL STATEMENTS. As soon as available and in
any event within 90 days after the end of each fiscal year of the
Transferor, a copy of the Servicer's Annual Report, on Form 10-K, as
filed with the Securities and Exchange Commission (or if the Servicer
is no longer required to file such Form 10-K, the Servicer shall
furnish such financial reports containing information typically found
on Form 10-K) and as reported on by nationally recognized independent
certified public accountants on a consolidated (for the Originator
only) basis; together with a copy of the year-end financial statements
of each Originator (which need not be reported by independent certified
accountants); and together with a certificate from vice president and
treasurer, chief financial officer or chief accounting officer of the
Servicer certifying that no Termination Event or Unmatured Termination
Event has occurred and containing a computation of, and showing
compliance with, the financial restrictions contained in SECTION 7.6;
(c) REPORTS TO HOLDERS AND EXCHANGES. In addition to the
reports required by SUBSECTION (A) next above, promptly upon the
Agent's request, copies of any reports specified in such request which
the Servicer sends to any of its security holders, and any reports or
registration statements that the Servicer files with the Securities and
Exchange Commission or any national securities exchange other than
registration statements relating to employee benefit plans and to
registrations of securities for selling security holders;
(d) ERISA. Promptly after the filing or receiving thereof,
copies of all reports and notices with respect to
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any Reportable Event defined in Article IV of ERISA which the Servicer
or any Originator files under ERISA with the Internal Revenue Service,
the Pension Benefit Guaranty Corporation or the U.S. Department of
Labor or which the Servicer or any Originator receives from the Pension
Benefit Guaranty Corporation;
(e) TERMINATION EVENTS. As soon as possible and in any event
within five days after the occurrence of each Termination Event and
each Unmatured Termination Event, written statement of the vice
president and treasurer, chief financial officer or chief accounting
officer of the Servicer setting forth details of such Event and the
action that the Servicer proposes to take with respect thereto;
(f) LITIGATION. As soon as possible and in any event within
three Business Days of the Servicer's knowledge thereof, notice of (i)
any litigation, investigation or proceeding which may exist at any time
which could have a material adverse effect on the business, operations,
prop erty or financial condition of the Servicer or any Originator or
impair the ability of the Servicer to perform its obligations under
this Agreement and (ii) any material adverse development in previously
disclosed litigation; and
(g) OTHER. Promptly, from time to time, such other information
(including a listing by Obligor of all Pool Receivables), documents,
records or reports respecting the Receivables or the condition or
operations, financial or otherwise, of the Servicer as the Agent may
from time to time reasonably request in order to protect the interests
of such Agent or any Purchaser under or as contemplated by this
Agreement.
SECTION 7.6. NEGATIVE COVENANTS OF THE SERVICER. From the date
hereof until the date, following the Commitment Termination Date, on which all
Undivided Interests shall be reduced to zero and all other amounts owing
hereunder shall have been paid, the Servicer will not, without the prior written
consent of the Agent:
(a) SALES, LIENS, ETC. Except as otherwise provided herein,
sell, assign (by operation of law or otherwise) or otherwise dispose
of, or create or suffer to exist any Adverse Claim upon or with respect
to, any Pool Receivable or related Contract or Related Security, or any
interest therein, or any lock-box account to which any Collections of
any Pool Receivable are sent, or any right to receive income from or in
respect of any of the foregoing.
(b) EXTENSION OR AMENDMENT OF RECEIVABLES. Except as otherwise
permitted in SECTION 8.2, extend, amend or otherwise
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modify the terms of any Pool Receivable, or amend, modify or waive
any term or condition of any Contract related thereto unless such
extension, amendment or modification (i) does not conflict with the
Credit and Collection Policy and (ii) does not affect the
collectibility of the related Receivable.
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. Make
any change in the character of its business or in the Credit and
Collection Policy.
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS. Add or
terminate any bank as a Lock-Box Bank from those listed in SCHEDULE
6.2(O) or make any change in its instructions to Obligors regarding
payments to be made to the Servicer or the Servicer or payments to be
made to any Lock-Box Bank, unless the Agent shall have received notice
of such addition, termination or change and duly executed copies of
Lock-Box Agreements with each new Lock-Box Bank in a form satisfactory
to the Agent.
(e) SOURCE OF BUSINESS. At any time permit more than 50% of
the Transferor's aggregate consolidated revenues to be derived from
businesses other than from the protective and/or correctional services
business.
(f) MERGERS, ACQUISITIONS, LINE OF BUSINESS. Be a party to any
merger or consolidation, or purchase or otherwise acquire all or
substantially all of the assets, or any stock of any class of, or any
partnership or joint venture interest in any other Person, or, except
in the ordinary course of its business, sell transfer, convey or lease
all or any substantial part of its assets, or sell or assign with or
without recourse, any receivables (other than pursuant hereto), or
permit any Subsidiary to do any of the foregoing, PROVIDED, HOWEVER,
that:
(i) any Subsidiary may merge or consolidate with or
into the Transferor or any wholly-owned Subsidiary so long as
in any merger or consolidation involving the Servicer, the
Servicer shall be the surviving or continuing corporation;
(ii) the Servicer may consolidate or merge with any
other corporation if (1) either (x) the Servicer shall be the
surviving or continuing corporation or (y) the surviving
corporation is organized and existing under the laws of the
United States of America or any state thereof or the District
of Columbia and such continuing or surviving corporation
expressly assumes in writing, in form and substance
satisfactory to the Agent, all obligations of the Servicer
under this
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Agreement, (2) at the time of such consolidation or merger and
after giving effect thereto no Unmatured Termination Event or
Termination Event shall have occurred and be continuing and
(3) after giving effect to such consolidation or merger the
Servicer or such surviving corporation, as the case may be,
could incur at least $1.00 of additional Consolidated Funded
Debt without causing Consolidated Funded Debt to exceed 60% of
Total Capitalization;
(iii) any Subsidiary may sell, lease or otherwise
dispose of all or any substantial part of its assets to
the Servicer or any wholly-owned Subsidiary; and
(iv) the Servicer and each Subsidiary may enter into,
any agreement, contract or arrangement, providing for the
acquisition of any Person or all or substantially all of the
assets of any Person (however structured); but if the amount
to be paid exceeds $5,000,000, the Servicer may do so only if
it shall, at least 30 days prior to consummation of such
transaction, have furnished to the Agent a certificate of an
authorized financial officer of Seller (x) certifying that
after giving effect to such acquisition no Unmatured
Termination Event or Termination Event will have occurred
hereunder, and (y) containing calculations conclusively
demonstrating that after giving effect to the proposed
transaction, and for the prior twelve months, if the
transaction had been consummated at the beginning of such
twelve month period, the Servicer will not be, and would not
have been, in violation of any covenant contained in SECTIONS
7.3(F) and 7.3(G) hereof.
(g) CORPORATE IDENTITY. At any time change its name, identity,
corporate structure or location unless at least 10 days prior thereto
the Servicer shall have delivered to the Agent UCC financing statements
or other statements amending or otherwise modifying UCC financing
statements filed here under in order to maintain a first perfected
ownership interest in favor of the Transferor pursuant to the
Receivables Purchase Agreement.
SECTION 7.7. FINANCIAL COVENANTS OF THE SERVICER.
(Additional terms used in this Section and not defined in Appendix A shall have
the meanings ascribed to such terms in Appendix C).
(A) CONSOLIDATED NET WORTH. The Servicer will at all times
keep and maintain Consolidated Net Worth at an amount not less than (i) 90% of
the Servicer and its Subsidiaries
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Consolidated Net Worth at the Closing Date and (ii) as at the last day of each
succeeding fiscal quarter of the Servicer and until (but excluding) the last day
of the next following fiscal quarter of the Servicer, the sum of (A) the amount
of Consolidated Net Worth required to be maintained pursuant to this SECTION
7.7 as at the end of the immediately preceding fiscal quarter, plus, (B) 50% of
Consolidated Net Income (with no reduction for net losses for any period) for
the fiscal quarter of the Servicer ending on such day, plus (C) 75% of the net
proceeds to the Servicer from the sale of shares of the Servicer's capital
stock.
(B) LIMITATIONS ON TOTAL DEBT.
(i) The Servicer will at all times keep and maintain
Consolidated Funded Debt in an amount not to exceed 40% of Total
Capitalization (excluding Funded Debt of WCC).
(ii) The Servicer and its Subsidiaries (other than WCC) will
not, at any time, issue, incur, assume, be or become liable in respect
of any Indebtedness other than (i) Indebtedness arising under this
Agreement, (ii) the purchase of products, merchandise and services in
the ordinary course of business, (iii) Indebtedness outstanding on the
Closing Date, (iv) Indebtedness of a Guarantor to the Servicer or to
another Guarantor, (v) Indebtedness representing amounts received by
the Servicer or any Subsidiary in exchange for the transfer of
interests in trade receivables under the Asset Securitization Facility
in excess of the amounts repaid to the purchasers in respect of such
purchase price from collections on such trade receivables, which shall
at no time exceed $75,000,000 in aggregate amount outstanding, and (vi)
Indebtedness in an aggregate amount for the Servicer and all
Subsidiaries (other than WCC) taken as a whole not greater than
$15,000,000.
(iii) Any corporation which becomes a Subsidiary after the
date hereof shall for all purposes of this SECTION 7.7 be deemed to
have created, assumed or incurred at the time it becomes a Subsidiary
all Indebtedness of such corporation existing immediately after it
becomes a Subsidiary.
(C) FIXED CHARGES COVERAGE RATIO. The Servicer will at all
times keep and maintain the ratio of Net Income Available for Fixed Charges,
determined as of the last day of each fiscal quarter for the immediately
preceding Four-Quarter Period, to Fixed Charges for such Four-Quarter Period, at
not less than 1.50:1.00.
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ARTICLE VIII
ADMINISTRATION AND COLLECTION
SECTION 8.1. DESIGNATION OF SERVICER. WACKENHUT AS INITIAL
SERVICER. The servicing, administering and collection of the Pool Receivables
shall be conducted by the Person designated as Servicer hereunder ("SERVICER")
from time to time in accordance with this SECTION 8.1. Until the Agent gives a
Successor Notice (as defined in SECTION 8.1(B), Wackenhut is hereby designated
as, and hereby agrees to perform the duties and obligations of, Servicer
pursuant to the terms hereof.
SECTION 8.2. SUCCESSOR NOTICE: SERVICER TRANSFER EVENT. Upon
Wackenhut's receipt of a notice from the Agent of the Agent's designation of a
new Servicer (a "SUCCESSOR NOTICE"), Wackenhut agrees that it will terminate its
activities as Servicer hereunder in a manner that the Agent reasonably believes
will facilitate the transition of the performance of such activities to the new
Servicer, and the Agent (or its designee) shall assume, until a new Servicer is
appointed or designated, each and all of Wackenhut's said obligations to service
and administer such Receivables, on the terms and subject to the conditions
herein set forth, and Wackenhut shall use its best efforts to assist the Agent
(or its designee) in assuming such obligations. The Agent will not give
Wackenhut a Successor Notice until after the occurrence of any Termination Event
listed in any of clauses (A), (E), (F), (G), (H), (I), (1) or (K) of SECTION
10.1 or any event which, in the reasonable opinion of the Agent, could have a
material adverse effect on Wackenhut's ability to perform its obligations as
Servicer hereunder (any such Termination Event or other event being herein
called a "SERVICER TRANSFER EVENT"), in which case such Successor Notice may be
given at any time in the Agent's discretion. If Wackenhut disputes the
occurrence of a Servicer Transfer Event, Wackenhut may take appropriate action
to resolve such dispute; PROVIDED that Wackenhut must terminate its activities
hereunder as Servicer and allow the newly designated Servicer to perform such
activities on the date provided by the Agent as described above, notwithstanding
the commencement or continuation of any proceeding to resolve the aforementioned
dispute. The Agent may at any time after the occurrence of a Servicer Transfer
Event designate any other Person as successor Servicer hereunder. If at any time
the Agent shall be servicing hereunder, upon the transfer of servicing by the
Agent to any successor Servicer, the Agent shall no longer perform the duties of
Servicer and shall have no further obligations or liabilities whatsoever in
respect thereof.
SECTION 8.3. SUBCONTRACTS. Servicer may, with the prior
consent of the Agent, subcontract with any other person for servicing,
administering or collecting the Pool Receivables, provided that Servicer shall
remain liable for the performance of
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the duties and obligations of Servicer pursuant to the terms hereof.
SECTION 8.4. DUTIES OF SERVICER. APPOINTMENT; DUTIES IN
GENERAL. Each of the Transferor, Purchaser, each Bank Investor and the Agent
hereby appoints as its agent the Servicer, as from time to time designated
pursuant to SECTION 8.1, to enforce its rights and interests in and under the
Pool Receivables, the Related Security and the Contracts. Servicer shall take or
cause to be taken all such actions as may be necessary or advisable in
accordance with the Credit and Collection Policy or otherwise at the direction
or with the consent of the Agent to collect each Pool Receivable from time to
time, all in accordance with applicable laws, rules and regulations, with
reasonable care and diligence. Servicer shall adopt the Credit and Collection
Policy for the servicing of the Pool Receivables.
SECTION 8.5. ALLOCATION OF COLLECTIONS; SEGREGATION. Servicer
shall set aside for the account of the Transferor, the Purchaser and each Bank
Investor, their respective allocable shares of the Collections of Pool
Receivables in accordance with SECTIONS 3.1 and 3.2 but shall not be required
(unless otherwise requested by the Agent, and subject to SECTION 3.7) to
segregate the funds constituting such portions of such Collections, or to
segregate the respective allocable shares of Enterprise and the Enterprise
Liquidity Provider and the Enterprise Credit Support Provider, as applicable,
prior to the remittance thereof in accordance with said Sections. If instructed
by the Agent, Servicer shall segregate and deposit with the Agent such allocable
shares of Collections of Pool Receivables, set aside for the Purchaser, the Bank
Investors, the Enterprise Liquidity Provider and Enterprise Credit Support
Provider and any other assignee from the Purchaser or any Bank Investor of any
Undivided Interest, on the first Business Day following receipt by Servicer of
such Collections in immediately available funds.
SECTION 8.6. MODIFICATION OF RECEIVABLES. So long as no
Termination Event or Unmatured Termination Event shall have occurred and be
continuing, the Servicer, may, strictly in accordance with the Credit and
Collection Policy, (i) extend the maturity or adjust the Unpaid Balance of any
Defaulted Receivable as it may determine to be appropriate to maximize
Collections thereof; PROVIDED that, after giving effect to such extension of
maturity, the Aggregate Required Allocations will not exceed the Required
Allocations Limit, and (ii) adjust the Unpaid Balance of any Receivable to
reflect the reductions or cancellations described in the first sentence of
SECTION 3.3(A).
SECTION 8.7. DOCUMENTS AND RECORDS. The Transferor shall, and
shall cause the Seller, to deliver to Servicer, and Servicer shall hold in trust
for the Transferor, each Originator, the Purchaser and the Bank Investors, in
accordance with their
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respective interests, all documents, instruments and records (including, without
limitation, computer tapes or disks) that evidence or relate to Pool
Receivables.
SECTION 8.8. CERTAIN DUTIES TO THE TRANSFEROR. Servicer shall,
as soon as practicable following receipt, turn over to the Transferor (i) that
portion of Collections of Pool Receivables representing its undivided interest
therein, less, all reasonable and appropriate out-of-pocket costs and expenses
of Servicer of servicing, collecting and administering the Pool Receivables to
the extent not covered by the Servicer's Fee received by it, and (ii) the
Collections of any Receivable which is not a Pool Receivable. Servicer, shall,
as soon as practicable upon demand, deliver to the Transferor all documents,
instruments and records in its possession that evidence or relate to Receivables
of the Transferor other than Pool Receivables, and copies of documents,
instruments and records in its possession that evidence or relate to Pool
Receivables.
SECTION 8.9. LOCK-BOX ACCOUNTS. Upon the occurrence of any
Lock-Box Control Event (as such term is defined in the Letter Agreement
(Segregation of Funds) of even date herewith between Wackenhut and NationsBank),
Servicer shall deliver to the Agent, in its capacity as Lock-Box Segregation
Agent thereunder, a list, referred to in such Letter Agreement as the
Identification List, setting forth those Collections held by Servicer and by
each Lock- Box Bank and received prior to said Business Day, and designating
such Collections as Collections in respect of Pool Receivables or as Collections
not subject to this Agreement. The Segregation Agent's duties shall be governed
solely by the terms of such Letter Agreement and no other duties or terms shall
be implied therein.
SECTION 8.10. RIGHTS OF THE AGENT. (a) NOTICE TO OBLIGORS. At
any time the Agent, in its discretion, after notice to the Transferor or
Servicer, may notify the Obligors of Pool Receivables, or any of them, of the
ownership of Undivided Interests by the Purchaser or the Bank Investors, as the
case may be.
(b) NOTICE TO LOCK-BOX BANKS. At any time following the
earliest to occur of (i) the occurrence of a Termination Event, (ii) any of the
Conditions Precedent shall not be satisfied and the Agent shall have requested
implementation of the Settlement procedures set forth in SECTION 3.2, and (iii)
the warranty in SECTION 6.1(I) shall no longer be true, the Agent is hereby
authorized to give notice to the Lock-Box Banks, as provided in the Lock-Box
Agreements, of the transfer to the Agent of dominion and control over the
lock-box accounts to which the Obligors of Pool Receivables make payments. The
Transferor hereby transfers to the Agent, effective when the Agent shall give
notice to the Lock-Box Banks as provided in the Lock-Box Agreements, the
exclusive dominion and control over such lock-box accounts, and shall take
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any further action that the Agent may reasonably request to effect
such transfer.
SECTION 8.11. RIGHTS ON SERVICER TRANSFER EVENT. At any time
following the designation of a Servicer other than the Transferor pursuant to
SECTION 8.1:
(a) The Agent may direct the Obligors of Pool
Receivables, or any of them, to pay all amounts payable under any Pool
Receivable directly to the Agent or its designee.
(b) Servicer shall, and shall direct each Originator
to, at the Agent's request and at the Servicer's expense, give notice
of such ownership to each said Obligor and direct that payments be made
directly to the Agent or its designee.
(c) The Transferor shall, and shall direct each
Originator to, at the Agent's request (with the written consent of the
Agent), (A) assemble all of the documents, instruments and other
records (including, without limitation, computer programs, tapes and
disks) which evidence the Pool Receivables, and the related Contracts
and Related Security, or which are otherwise necessary or desirable to
collect such Pool Receivables, and shall make the same available to the
Agent at a place selected by the Agent or its designee, and (B)
segregate all cash, checks and other instruments received by it from
time to time constituting Collections of Pool Receivables in a manner
acceptable to the Agent and shall, promptly upon receipt, remit all
such cash, checks and instruments, duly endorsed or with duly executed
instruments of transfer, to the Agent or its designee.
(d) Each of the Transferor, the Purchaser and the
Bank Investors, as the case may be, hereby authorizes the Agent to take
any and all steps in the Transferor's name and on behalf of the
Transferor and the Purchaser, the Bank Investors, as the case may be,
which are necessary or desirable, in the determination of the Agent,
to collect all amounts due under any and all Pool Receivables,
including, without limitation, endorsing the Transferor's name on
checks and other instruments representing Collections and enforcing
such Pool Receivables and the related Contracts.
SECTION 8.12. RESPONSIBILITIES OF THE TRANSFEROR. Anything
herein to the contrary notwithstanding:
(a) None of the Agent, the Purchaser nor any Bank
Investor shall have any obligation or liability with respect to any
Pool Receivables, Contracts related thereto or any other related
purchase orders or other agreements, nor shall any of them be obligated
to perform any of the obligations of the Transferor, Wackenhut or any
Originator thereunder.
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(b) The Transferor hereby grants to the Servicer and
the Agent, for the benefit of the Purchaser and the Bank Investors, as
the case may be, an irrevocable power of attorney, with full power of
substitution, coupled with an interest, to take in the name of the
Transferor all steps which are necessary or advisable to endorse,
negotiate or otherwise realize on any writing or other right of any
kind held or transmitted by the Transferor or transmitted or received
by the Purchaser or any Bank Investor, as the case may be (whether or
not from the Transferor) in connection with any Receivable after the
occurrence of any default by the Transferor hereunder or the occurrence
of any Termination Event.
SECTION 8.13. FURTHER ACTION EVIDENCING PURCHASES. (a) The
Transferor will, and will cause the Seller to, from time to time, at its
expense, promptly execute and deliver all further instruments and documents, and
take all further action that any Agent may reasonably request in order to
perfect, protect or more fully evidence the Purchases hereunder and the
resulting Undivided Interests, or to enable the Purchaser, the Bank Investors or
the Agent to exercise or enforce any of their respective rights hereunder or
under the Certificate of Assignments. Without limiting the generality of the
foregoing, the Transferor will upon the request of any Agent: execute and file
such financing or continuation statements, or amendments thereto or assignments
thereof, and such other instruments or notices, as may be necessary or
appropriate and will maintain such procedures as are necessary to permit daily
identification of Pool Receivables and Eligible Receivables.
(b) The Transferor hereby authorizes the Agent to file one or
more financing or continuation statements on behalf of and for the benefit of
the Agent, the Purchaser or the Bank Investors, as the case may be, and
amendments thereto and assignments thereof, relative to all or any of the Pool
Receivables and the Related Security now existing or hereafter arising in the
name of the Transferor. If the Transferor fails to perform any of its agreements
or obligations under this Agreement, the Agent may (but shall not be required
to) itself perform, or cause performance of, such agreement or obligation, and
the expenses of the Agent incurred in connection therewith shall be payable by
the Transferor as provided in SECTION 13.1.
(c) Without limiting the generality of SUBSECTION (A), the
Transferor will, not earlier than six (6) months and not later than three (3)
months from the fifth anniversary of the date of filing of the financing
statement referred to in SECTION 5.1(F) or any other financing statement filed
pursuant to this Agreement or in connection with any Purchase hereunder, unless
the Commitment Termination Date shall have occurred and all Undivided Interests
shall have been reduced to zero:
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(i) execute and deliver and file or cause to be
filed an appropriate continuation statement with respect to such
financing statement; and
(ii) deliver or cause to be delivered to the Agent an
opinion of the counsel for the Transferor referred to in SECTION 5.1(I)
(or other counsel for the Transferor reasonably satisfactory to the
Agent), in form and substance reasonably satisfactory to the Agent,
confirming and updating the opinion delivered pursuant to SECTION
5.1(I) with respect to the matters set forth in paragraph No. [ ] of
EXHIBIT 5.1(I) and otherwise to the effect that all of the Undivided
Interests hereunder continue to be first and prior perfected security
interests.
SECTION 8.14. APPLICATION OF COLLECTIONS. Any payment by an
Obligor in respect of any indebtedness owed by it to the Transferor shall,
except as otherwise specified by an Obligor or otherwise required by contract or
law and unless the Agent instructs otherwise, be applied as a Collection of any
Pool Receivable or Receivables of an Obligor to the extent of any amounts then
due and payable thereunder before such payment is applied to any other
indebtedness of an Obligor.
ARTICLE IX
SECURITY INTEREST
SECTION 9.1. GRANT OF SECURITY INTEREST. To secure all
obligations of the Transferor arising in connection with this Agreement, the
Certificate of Assignments and each other Agreement Document to which it is a
party, whether now or hereafter existing, due or to become due, direct or
indirect, or absolute or contingent, Indemnified Amounts, payments on account
of Collections received or deemed to be received, fees and Earned Discount, in
each case PRO RATA according to the respective amounts thereof, the Transferor
hereby assigns and grants the Agent, on behalf of the Purchaser and each Bank
Investor, a security interest in all of the Transferor's (i) right, title and
interest (including specifically any undivided interest retained by the
Transferor hereunder) now or hereafter existing in, to and under all the Pool
Receivables, the Related Security and all Collections with regard thereto and
(ii) rights, remedies, powers and privileges under and in respect of the
Receivables Purchase Agreement.
SECTION 9.2. FURTHER ASSURANCES. The provisions of SECTION
8.5 shall apply to the security interest granted under SECTION 9.1 as well as to
the Purchases and all Undivided Interests hereunder.
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SECTION 9.3. REMEDIES. Upon the occurrence of a Termination
Event, the Agent shall have, with respect to the collateral granted pursuant to
SECTION 9.1, and in addition to all other rights and remedies available to the
Purchaser, the Bank Investors, or the Agent under this Agreement or other
applicable law, all the rights and remedies of a secured party upon default
under the UCC.
ARTICLE X
[RESERVED]
ARTICLE XI
TERMINATION
SECTION 11.1. TERMINATION EVENTS. If any of the
following events ("TERMINATION EVENTS") shall occur:
(a) Servicer (if Wackenhut) shall fail to perform or
observe any term, covenant or agreement hereunder (other than as
referred to in CLAUSE (II) next following) and such failure shall
remain unremedied for five Business Days or (ii) Servicer (if
Wackenhut) or the Transferor (if not Servicer) shall fail to make any
payment or deposit to be made by it hereunder when due; or
(b) Any representation or warranty made or deemed to
be made by the Transferor, Servicer or any Originator (or any of their
respective officers) under or in connection with this Agreement, any
other Agreement Document, or any Periodic Report or other information
or report delivered pursuant hereto shall prove to have been false or
incorrect in any material respect when made and, if such condition
shall be amenable to remedy, such condition shall continue unremedied
for a period of ten Business Days after (i) written notice thereof by
the Agent or (ii) the Transferor, Servicer or such Originator has
actual knowledge thereof; or
(c) The Transferor, Servicer, Wackenhut or any
Originator shall fail to perform or observe any other term, covenant or
agreement contained in this Agreement or any other Agreement Document,
on their respective parts to be performed or observed and any such
failure shall remain unremedied for five Business Days after the date
on which the Transferor, Servicer, Wackenhut or such Originator knew or
should have known of such failure; or
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(d) A default shall have occurred and be continuing under any
instrument or agreement evidencing, securing or providing for the
issuance of indebtedness for borrowed money in excess of $100,000 of,
or guaranteed by, the Transferor, Servicer, Wackenhut, any Originator
or of any Affiliate of either thereof, which default if unremedied,
uncured, or unwaived (with or without the passage of time or the giving
of notice or both) would permit acceleration of the maturity of such
indebtedness and such default shall have continued unremedied, uncured
or unwaived for a period long enough to permit such acceleration and
any notice of default required to permit acceleration shall have been
given; or any default under any agreement or instrument relating to the
purchase of receivables of the Transferor, Wackenhut, any Originator or
of any Affiliate of either thereof, or any other event, shall occur and
shall continue after the applicable grace period, if any, specified in
such agreement or instrument, if the effect of such default is to
terminate, or permit the termination of, the commitment of any party to
such agreement or instrument to purchase receivables or the right of
the Transferor to reinvest in receivables the principal amount paid by
any party to such agreement or instrument for interest in receivables;
or
(e) An Event of Bankruptcy shall have occurred and remained
continuing with respect to the Transferor, Servicer, Wackenhut any
Originator or any Affiliate of any thereof; or
(f) Any litigation (including, without limitation, derivative
actions), arbitration proceedings or governmental proceedings not
disclosed in writing by the Transferor to the Agent, prior to the date
of execution and delivery of this Agreement is pending against the
Transferor, Servicer, Wackenhut, any Originator or any Affiliate of any
thereof, or (ii) any material development not so disclosed has occurred
in any litigation (including, without limitation, derivative actions),
arbitration proceedings or governmental proceedings so disclosed,
which, in the case of CLAUSE (I) or (II), in the opinion of the Agent,
is likely to materially adversely affect the financial position or
business of the Transferor, Servicer, any Originator or any Affiliate
of any thereof or impair the ability of the Transferor or Servicer to
perform its obligations under this Agreement; or
(g) After any Settlement Date, the Aggregate Required
Allocations shall exceed the Required Allocations Limit; or
(h) The Losses to Liquidations Ratio exceeds 2%; or
(i) Three-Month Default Ratio at any time exceeds 6%; or
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(j) Three-Month Dilution Ratio at any time exceeds 2.5%; or
(k) There shall have occurred any event which materially
adversely affects the collectibility of the Pool Receivables or there
shall have occurred any other event which materially adversely affects
the ability of the Transferor, any Originator or Servicer to collect
Pool Receivables or the ability of the Transferor or Servicer to
perform hereunder or the warranty in SECTION 6.1(N) shall not be true
at any time; or
(l) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Internal Revenue Code with regard to
any of the assets of the Transferor, Servicer, the Seller, any
Originator or any Affiliate and such lien shall not have been released
within 30 days, or the Pension Benefit Guaranty Corporation shall, or
shall indicate its intention to, file notice of a lien pursuant to
Section 4068 of the Employee Retirement Income Security Act of 1974
with regard to any of the assets of the Transferor, Servicer, the
Seller or any Originator; or
(m) A Purchase and Sale Termination Event shall have occurred;
or
(n) The Wackenhut Family shall at any time, directly or
indirectly, control less than 33 1/3% of the voting securities of the
Transferor, the Seller, Servicer or any Originator; or
(o) The Agent on behalf of the Purchaser and the Bank
Investors, fail for any reason to have a perfected first priority
security interest as described in SECTION 9.1; or
(p) The Aggregate Required Allocations shall at any time
exceed the Required Allocations Limit.
SECTION 11.2. REMEDIES. (a) OPTIONAL TERMINATION. Upon the
occurrence of a Termination Event (other than a Termination Event described in
SUBSECTION (A), (E), (F), or (P) of SECTION 11.1), the Agent shall, at the
request, or may with the consent, of the Purchaser, by notice to the Transferor
declare the Commitment Termination Date to have occurred.
(b) AUTOMATIC TERMINATION. Upon the occurrence of a
Termination Event described in SUBSECTION (A), (E), (F) or (P) of SECTION 11.1,
the Commitment Termination Date shall be deemed to have occurred automatically
upon the occurrence of such event; PROVIDED, HOWEVER, that with respect to any
proceeding instituted against the Transferor pursuant to 11 U.S.C. ss.303 (an
"INVOLUNTARY FEDERAL PROCEEDING"), the settlement procedures described in
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SECTION 3.2 shall become applicable upon the commencement of such Proceeding and
no further Purchases or Reinvestments of Collections shall be made; and
PROVIDED, FURTHER, that if such Involuntary Federal Proceeding is dismissed
within 60 days after its commencement, and if no other Termination Event has
occurred, then following such dismissal, the Commitment shall be reinstated as
if the Commitment Termination Date had not occurred upon the commencement of
such Involuntary Federal Proceeding.
(c) ADDITIONAL REMEDIES. Upon any termination of the Facility
pursuant to this SECTION 11.2, the Agent, the Purchaser and the Bank Investors
shall have, in addition to all other rights and remedies under this Agreement or
otherwise, all other rights and remedies provided under the UCC of each
applicable jurisdiction and other applicable laws, which rights shall be
cumulative. Without limiting the foregoing or the general applicability of
ARTICLE XIII hereof, the occurrence of a Termination Event shall not deny to
the Agent, the Purchaser or any Bank Investor any remedy in addition to
termination of the Commitment to which the Agent, the Purchaser or any Bank
Investor may be otherwise appropriately entitled, whether at law or in equity.
ARTICLE XII
THE AGENT
SECTION 12.1. AUTHORIZATION AND ACTION. The Purchaser and each
Bank Investor hereby appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under this Agreement as are
delegated to such Agent by the terms hereof, together with ,such powers as are
reasonably incidental thereto. The provisions of this ARTICLE XII are solely for
the benefit of the Agent, the Purchaser and the Bank Investors, and the
Transferor shall not have any rights as a third-party beneficiary or otherwise
under any of the provisions hereof. In performing its functions and duties
hereunder, the Agent shall act solely as the agent for the Purchaser and the
Bank Investors, as the case may be, and does not assume nor shall be deemed to
have assumed any obligation or relationship of trust or agency with or for the
Transferor or any Originator or any of their respective successors and assigns.
SECTION 12.2. AGENTS' RELIANCE, ETC. Neither the Agent nor any
of its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or the Agent under or in connection with this
Agreement (including, without limitation, the servicing, administering or
collecting Pool Receivables as Servicer pursuant to SECTION 8.1), except for its
or their own gross negligence or willful misconduct. Without limiting the
generality of the foregoing, the Agent: (a) may consult with legal counsel
(including counsel for the Transferor), independent
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certified public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts; (b) makes no
warranty or representation to the Purchaser, any Bank Investor or any other
holder of any interest in Pool Receivables and shall not be responsible to the
Purchaser, any Bank Investor or any such other holder for any statements,
warranties or representations made in or in connection with this Agreement; (c)
shall not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of this Agreement on the
part of the Transferor or to inspect the property (including the books and
records) of the Transferor; (d) shall not be responsible to the Purchaser any
Bank Investor or any other holder of any interest in Pool Receivables for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement, the Certificate of Assignments or any Agreement
Document; and (e) shall incur no liability under or in respect of this Agreement
by acting upon any notice (including notice by telephone), consent, certificate
or other instrument or writing (which may be by facsimile or telex) believed by
it to be genuine and signed or sent by the proper party or parties.
SECTION 12.3. AGENTS AND AFFILIATES. NationsBank and its
Affiliates may generally engage in any kind of business with the Transferor,
Servicer, any Originator or any Obligor, any of their respective Affiliates and
any Person who may do business with or own securities of the Transferor or any
Obligor or any of their respective Affiliates, all as if NationsBank was not the
Agent and without any duty to account therefor to the Purchaser, any Bank
Investor or any other holder of an interest in Pool Receivables.
ARTICLE XIII
BANK COMMITMENT; ASSIGNMENT OF PURCHASER'S INTEREST
SECTION 13.1. RIGHTS AS BANK INVESTOR. With respect to its
Bank Commitment, NationsBank (and any successor acting as Agent) in its capacity
as a Bank Investor hereunder shall have the same rights and powers hereunder as
any other Bank Investor and may exercise the same as though it were not acting
as the Agent, and the term "BANK INVESTOR" or "BANK INVESTORS" shall, unless the
context otherwise indicates, include the Agent in its individual capacity.
NationsBank (and any successor acting as Agent) and its affiliates may (without
having to account therefor to the Purchaser or any Bank Investor) accept
deposits from, lend money to, make investments in, provide services to, and
generally engage in any kind of lending, trust, or other business with any of
the Trans feror and the Agent or any of their Subsidiaries or affiliates as if
it were not acting as Agent, and NationsBank (and any successor acting as Agent)
and its affiliates may accept fees and other
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consideration from any of the Transferor and its affiliates and the Agent or any
of their Subsidiaries or affiliates for services in connection with this
Agreement or otherwise without having to account for the same to the Purchaser
or any Bank Investor.
SECTION 13.2. INDEMNIFICATION OF THE AGENT. The Bank Investors
agree to indemnify the Agent (to the extent not reimbursed by the Transferor),
ratably in accordance with their PRO RATA portions of the Undivided Interests,
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses (including attorneys'
fees), or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Agent (including by the Purchaser or
any Bank Investor) in any way relating to or arising out of this Agreement or
any other PROVIDED, HOWEVER, or the transactions contemplated thereby or any
action taken or omitted by the Agent under this Agreement or any other Agreement
Document, PROVIDED that no Bank Investors shall be liable for any of the
foregoing to the extent they arise from the gross negligence or willful
misconduct of the Person indemnified. Without limitation of the foregoing, the
Bank Investors agree to reimburse the Agent, ratably in accordance with their
PRO RATA portions of the Undivided Interests promptly upon demand for any
out-of-pocket expenses (including attorneys' fees) incurred by the Agent in
connection with the administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement and the
other Agreement Documents, to the extent that such expenses are incurred in the
interests of or otherwise in respect of the Bank Investors hereunder and/or
thereunder and to the extent that the Agent is not reimbursed for such expenses
by the Transferor. The agreements contained in this SECTION 13.2 shall survive
payment in full of the Undivided Interests and all other amounts payable under
this Agreement.
SECTION 13.3. NON-RELIANCE. The Purchaser and each Bank
Investor agrees that it has, independently and without reliance on the Agent or
the Purchaser or any Bank Investor, and based on such documents and information
as it has deemed appropriate, made its own credit analysis of the Transferor and
the Agent and their Subsidiaries and decision to enter into this Agreement and
that it will, independently and without reliance upon the Agent, the Purchaser
or any Bank Investor, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under the Agreement Documents. Except for notices,
reports, and other documents and information expressly required to be furnished
to the Purchaser and the Bank Investors by the Agent hereunder, the Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the affairs, financial condition, or business of
the Transferor or the Agent or
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any of their Subsidiaries or affiliates that may come into the possession of the
Agent or any of its affiliates.
SECTION 13.4. PAYMENTS BY THE AGENT. Unless specifically
allocated to a Bank Investor pursuant to the terms of this Agreement, all
amounts received by the Agent on behalf of the Bank Investors shall be paid by
the Agent to the Bank Investors (at their respective accounts specified in their
respective Assignment and Assumption Agreements) in accordance with their
respective related pro rata interests in the Undivided Interest, on the Business
Day received by the Agent, unless such amounts are received after 12:00 noon on
such Business Day, in which case the Agent shall use its reasonable efforts to
pay such amounts to the Bank Investors on such Business Day, but, in any event,
shall pay such amounts to the Bank Investors in accordance with their respective
related pro rata interests in the Undivided Interest, not later than the
following Business Day.
SECTION 13.5. BANK COMMITMENT; ASSIGNMENT TO BANK INVESTORS.
(a) BANK COMMITMENT. At any time on or prior to the Commitment
Termination Date, in the event that the Purchaser does not effect a Purchase as
requested under SECTION 2.1 then at any time, the Transferor shall have the
right to require the Purchaser to assign its interest in the Aggregate
Purchaser's Investment in whole to the Bank Investors pursuant to this SECTION
13.5. In addition, at any time on or prior to the Commitment Termination Date
(i) upon the occurrence of a Termination Event that results in the Commitment
Termination Date or (ii) the Purchaser elects to give notice to the Transferor
of a Reinvestment Termination Date, the Transferor hereby requests and directs
that the Purchaser assign its interest in the Aggregate Purchaser's Investment
in whole to the Bank Investors pursuant to this SECTION 13.5 and the Transferor
hereby agrees to pay the amounts described in SECTION 13.6(D) below. Provided
that the Net Asset Test is satisfied, upon any such election by the Purchaser or
any such request by the Transferor, the Purchaser shall make such assignment and
the Bank Investors shall accept such assignment and shall assume all of the
Purchaser's obligations hereunder. In connection with any assignment from the
Purchaser to the Bank Investors pursuant to this SECTION 13.5, each Bank
Investor shall, on the date of such assignment, pay to the Purchaser an amount
equal to its Assignment Amount. Upon any assignment by the Purchaser to the Bank
Investors contemplated hereunder, the Purchaser shall cease to make any
additional Purchases hereunder.
(b) ASSIGNMENT. No Bank Investor may assign all or a portion
of its interest in the Purchaser's Investment, the Receivables, and Collections,
Related Security and Proceeds with respect thereto and its rights and
obligations hereunder to any Person unless approved in writing by the
Transferor, the Purchaser
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and the Agent. In the case of an assignment by the Purchaser to the Bank
Investors or by a Bank Investor to another Person, the assignor shall deliver to
the assignee(s) an Assignment and Assumption Agreement in substantially the form
of Schedule 13.5(b) attached hereto, duly executed, assigning to the assignee a
pro rata interest in the Purchaser's Investment, the Receivables, and
Collections, Related Security and Proceeds with respect thereto and the
assignor's rights and obligations hereunder and the assignor shall promptly
execute and deliver all further instruments and documents, and take all further
action, that the assignee may reasonably request, in order to protect, or more
fully evidence the assignee's right, title and interest in and to such interest
and to enable the Agent, on behalf of such assignee, to exercise or enforce any
rights hereunder and under the other Agreement Documents to which such assignor
is or, immediately prior to such assignment, was a party. Upon any such
assignment, (i) the assignee shall have all of the rights and obligations of the
assignor hereunder and under the other Agreement Documents to which such
assignor is or, immediately prior to such assignment, was a party with respect
to such interest for all purposes of this Agreement and under the other
Agreement Documents to which such assignor is or, immediately prior to such
assignment, was a party (it being understood that the Bank Investors, as
assignees, shall (x) be obligated to fund Purchases under Section 1.3(c) in
accordance with the terms thereof, notwithstanding that the Purchaser was not so
obligated and (y) not have the right to elect the commencement of the
amortization of the Purchaser's Investment pursuant to the definition of
"Reinvestment Termination Date", notwithstanding that the Company had such
right) and (ii) the assignor shall relinquish its rights with respect to such
interest for all purposes of this Agreement and under the other Agreement
Documents to which such assignor is or, immediately prior to such assignment,
was a party. No such assignment shall be effective unless a fully executed copy
of the related Assignment and Assumption Agreement shall be delivered to the
Agent and the Transferor. All costs and expenses of the Agent and the assignor
and assignee incurred in connection with any assignment hereunder shall be borne
by the Transferor and not by the assignor or any such assignee. No Bank Investor
shall assign any portion of its Commitment hereunder without also simultaneously
assigning an equal portion of its interest in the Liquidity Provider Agreement.
(c) EFFECTS OF ASSIGNMENT. By executing and delivering an
Assignment and Assumption Agreement, the assignor and assignee thereunder
confirm to and agree with each other and the other parties hereto as follows:
(i) other than as provided in such Assignment and Assumption Agreement, the
assignor makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this Agreement, the other Agreement Documents or any other
instrument or document furnished pursuant hereto or thereto or the execution,
legality, validity, enforceability,
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genuineness, sufficiency or value or this Agreement, the other Agreement
Documents or any such other instrument or document; (ii) the assignor makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Transferor or the Agent or the performance or
observance by the Transferor or the Agent of any of their respective obligations
under this Agreement, the other Agreement Documents or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, and such other instruments, documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption Agreement and to purchase
such interest; (iv) such assignee will, independently and without reliance upon
the Agent, or any of its Affiliates, or the assignor and based on such
agreements, documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and the other Agreement Documents; (v) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement, the other Agreement Documents and any other
instrument or document furnished pursuant hereto or thereto as are delegated to
the Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto and to enforce its respective rights and interests
in and under this Agreement, the other Agreement Documents, the Receiv xxxxx,
and the Contracts; (vi) such assignee agrees that it will perform in accordance
with their terms all of the obligations which by the terms of this Agreement and
the other Agreement Documents are required to be performed by it as the assignee
of the assignor; and (vii) such assignee agrees that it will not institute
against the Purchaser any proceeding of the type referred to in SECTION 15.6
prior to the date which is one year and one day after the payment in full of all
Commercial Paper issued by the Purchaser.
(d) THE TRANSFEROR'S OBLIGATION TO PAY CERTAIN AMOUNTS;
ADDITIONAL ASSIGNMENT AMOUNT. The Transferor shall pay to the Agent, for the
account of the Purchaser, in connection with any assignment by the Purchaser to
the Bank Investors pursuant to SECTION 13.5, an aggregate amount equal to the
Discount Factor to accrue through the end of each outstanding Yield Period plus
all other Aggregate Unpaids (other than the Aggregate Purchaser's Investment).
To the extent that such Discount Factor relates to interest or discount on
Related Commercial Paper, if the Transferor fails to make payment of such
amounts at or prior to the time of assignment by the Purchaser to the Bank
Investors, such amount shall be paid by the Bank Investors (in accordance with
their respective PRO RATA portion) to the Purchaser as additional consideration
for the interests assigned to the Bank Investors and the amount of the
"Aggregate Purchaser's Investment" hereunder held by the Bank Investors shall be
increased by an amount equal to the additional amount so paid by the Bank
Investors.
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(e) DOWNGRADE OF BANK INVESTOR. If at any time prior to any
assignment by the Purchaser to the Bank Investors as contem plated pursuant to
this SECTION 13.5, the short term debt rating of any Bank Investor shall be
"A-2" or "P-2" from Standard & Poor's or Xxxxx'x, respectively, with negative
credit implications, such Bank Investor, upon request of the Agent, shall,
within 30 days of such request, assign its rights and obligations hereunder to
another financial institution (which institution's short term debt shall be
rated at least "A-2" and "P-2" from Standard & Poor's and Xxxxx'x, respectively,
and which shall not be so rated with negative credit implications). If the short
term debt rating of a Bank Investor shall be "A-3" or "P-3", or lower, from
Standard & Poor's or Xxxxx'x, respectively (or such rating shall have been
withdrawn by Standard & Poor's or Xxxxx'x), such Bank Investor, upon request of
the Agent, shall, within five (5) Business Days of such request, assign its
rights and obligations hereunder to another financial institution (which
institution's short term debt shall be rated at least "A-2" and "P-2" from
Standard & Poor's and Moody's, respec tively, and which shall not be so rated
with negative credit implications). In either such case, if any such Bank
Investor shall not have assigned its rights and obligations under this Agreement
within the applicable time period described above, the Purchaser shall have the
right to require such Bank Investor to accept the assignment of such Bank
Investor's PRO RATA portion of the Pool Balance; such assignment shall occur in
accordance with the applicable provisions of this SECTION 13.5(D). Such Bank
Investor shall be obligated to pay to the Purchaser, in connection with such
assignment, in addition to the PRO RATA portion of the Aggregate Purchaser's
Investment, an amount equal to the interest component of the outstanding
Commercial Paper Notes issued to fund the portion of the Aggregate Purchaser's
Investment being assigned to such Bank Investor, as reasonably determined by the
Agent. Notwithstanding anything contained herein to the contrary, upon any such
assignment to a downgraded Bank Investor as contemplated pursuant to the
immediately preceding sentence, the aggregate available amount of the Facility
Limit, solely as it relates to new Purchases by the Purchaser, shall be reduced
by the amount of unused Commitment of such downgraded Bank Investor; it being
understood and agreed, that nothing in this sentence or the two preceding
sentences shall affect or diminish in any way any such downgraded Bank
Investor's Commitment to the Transferor or such downgraded Bank Investor's other
obligations and liabilities hereunder and under the other Agreement Documents.
(f) ADMINISTRATION OF AGREEMENT AFTER ASSIGNMENT. After any
assignment by the Purchaser to the Bank Investors pursuant to this SECTION 13.5
(and the payment of all amounts owing to the Purchaser in connection therewith),
all rights of the Agent set forth herein shall be deemed to be afforded to the
Agent on behalf of the Bank Investors instead of the Purchaser.
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SECTION 13.6. RESTRICTIONS ON ASSIGNMENTS. Except as otherwise
contemplated by Section 13.5, neither the Transferor nor the Purchaser may
assign its rights hereunder or any interest herein without the prior written
consent of the Agent, and the Purchaser may not assign any Undivided Interest
(or portion thereof) to any Person without the prior written consent of the
Transferor; PROVIDED, HOWEVER, that:
(a) Enterprise may assign or grant a security
interest in, any Undivided Interest (or portion thereof) owned by it to
NationsBank, the Enterprise Liquidity Provider or the Enterprise Credit
Support Provider (or any successor thereof by merger, consolidation or
otherwise), any Affiliate of Enterprise (including any securitization
vehicle managed by NationsBank) or such Enterprise Liquidity Provider
or Enterprise Credit Support Provider (which may then assign any such
Undivided Interest (or portion thereof) so assigned or any interest
therein to such party or parties as it may choose); and
(b) The Purchaser may assign and grant a security
interest in any interest in, to and under any Undivided Interest owned
by it, this Agreement and the other Agreement Documents to NationsBank,
as collateral agent or collateral trustee, and any successor in such
capacity, to secure each such Purchaser's obligations under or in
connection with its Commercial Paper Notes, the Enterprise Liquidity
Agreement, the Enterprise Credit Support Agreement and certain other
obligations of the Purchaser incurred in connection with the funding of
the Purchases and Reinvestments hereunder, which assignment and grant
of a security interest shall not be considered an "assignment" for
purposes of SECTION 13.5(B), or, prior to the enforcement of such
security interest, for purposes of any other provision of this
Agreement.
(c) The Transferor agrees to advise the Agent within
five Business Days after notice to the Transferor of any proposed
assignment by the Purchaser of any Undivided Interest (or portion
thereof), not otherwise permitted under SUBSECTION (A), of the
Transferor's consent or non-consent to such assignment. If the
Transferor does not consent to such assignment, the Purchaser may
immediately assign such Undivided Interest (or portion thereof), to
NationsBank, the Enterprise Liquidity Provider or the Enterprise Credit
Support Provider or any Affiliate of NationsBank, the Enterprise
Liquidity Provider or the Enterprise Credit Support Provider. All of
the aforementioned assignments shall be upon such terms and conditions
as the Purchaser and the assignee may mutually agree.
SECTION 13.7. RIGHTS OF ASSIGNEE. Upon the assignment by the
Purchaser of any Undivided Interest (or portion thereof)
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owned by it in accordance with this ARTICLE XIII, (a) the assignee receiving
such assignment shall have all of the rights of the Purchaser hereunder with
respect to such Undivided Interest (or such parties thereof) and (b) all
references to the Purchaser in SECTION 4.2 shall be deemed to apply to such
assignee to the extent of its interest the Purchaser's Investment and the
related Collections.
SECTION 13.8. AUTHORIZATION OF AGENT. The Purchaser authorizes
the Agent to, and the Agent agrees that it shall, endorse the Certificate(s) of
the Purchaser to reflect any assignments made pursuant to this ARTICLE XIII or
otherwise.
SECTION 13.9. NOTICE OF ASSIGNMENT. The Purchaser shall
provide notice to the Transferor and the Agent of any assignment of
any Undivided Interest (or portion thereof) by the Purchaser to any
assignee.
SECTION 13.10. EVIDENCE OF ASSIGNMENT; ENDORSEMENT OF
CERTIFICATE. Any assignment of any Undivided Interest (or portion thereof) to
any Person may be evidenced by an instrument of assignment in the form of
SCHEDULE 13.5 or by such other instruments) or documents) as may be
satisfactory to the Purchaser, the Agent and the assignee. The Purchaser
authorizes the Agent to, and the Agent agrees that it shall, endorse its
Certificate of Assignments to reflect any assignments made pursuant to this
ARTICLE XIII or otherwise.
SECTION 13.11. RIGHTS OF SUPPORT PROVIDERS. The Transferor
hereby agrees that, upon notice to the Transferor, the Enterprise Liquidity
Provider, the Enterprise Credit Support Provider and the collateral agent or
collateral trustee referred to in SECTION 13.1 (collectively, the "ASSIGNEE
PARTIES", each an "ASSIGNEE PARTY"), or any of them, may exercise all the rights
of NationsBank (or Enterprise) respectively hereunder, with respect to Undivided
Interests, and Collections with respect thereto, which have been assigned (or in
which a security interest has been granted) to such Assignee Party, with respect
to all Undivided Interests (or portions thereof), and Collections with respect
thereto, which are owned by Enterprise (and not subject to an assignment or a
separate security interest in favor of the Enterprise Liquidity Provider or
Enterprise Credit Support Provider), and all other rights and interests of
Enterprise, in, to or under this Agreement or any other Agreement Document.
Without limiting the foregoing, upon such notice such Assignee Party may request
Servicer to segregate its allocable shares of Collections, in accordance with
SECTION 8.2(A), may give a Successor Notice pursuant to SECTION 8.1(A), may give
or require the Agent to give notice to the Lock-Box Banks as referred to in
SECTION 8.3(A), and may direct the Obligors of Pool Receivables to make payments
in respect thereof directly to an account designated by them (provided that such
Assignee Party shall designate a single account for the
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making of such payments with respect to any Pool Receivable), in each case, to
the same extent as NationsBank (or Enterprise) might have done.
ARTICLE XIV
INDEMNIFICATION
SECTION 14.1. INDEMNITIES BY THE TRANSFEROR AND SERVICER. (a)
GENERAL INDEMNITY. Without limiting any other rights which any such Person may
have hereunder or under applicable law, the Transferor hereby agrees to
indemnify each of the Agent, the Purchasers, the Enterprise Liquidity Support
Provider, the Enterprise Credit Support Provider, NationsBank, each of and
NationsBank's Affiliates, their respective successors, transferees, participants
and assigns and all officers, directors, shareholders, controlling persons,
employees and agents of any of the foregoing (each an "INDEMNIFIED PARTY"),
forthwith on demand from and against any and all damages, losses, claims,
liabilities and related costs and expenses, including reasonable attorneys fees
and disbursements (all of the foregoing being collectively referred to as
"INDEMNIFIED AMOUNTS") awarded against or incurred by any of them arising out
of or relating to this Agreement or the ownership or funding of any Undivided
Interest or in respect of any Receivable or any Contract, EXCLUDING, HOWEVER,
(a) Indemnified Amounts to the extent resulting from gross negligence or willful
misconduct on the part of such Indemnified Party or (b) recourse (except as
otherwise specifically provided in this Agreement) for Defaulted Receivables or
delinquent receivables. Without limiting the foregoing, the Transferor shall
indemnify each Indemnified Party for Indemnified Amounts arising out of or
relating to:
(i) the transfer by the Transferor of any interest in
any Receivable other than the transfer of an Undivided Interest to the
Agent on behalf of the Purchaser or the Bank Investors, as the case may
be, pursuant this Agreement and the grant of a security interest to the
Agent on behalf of Purchaser and the Bank Investors pursuant to SECTION
9.1;
(ii) the breach of any representation or warranty
made by the Transferor or the Seller (or any of their officers) under
or in connection with this Agreement, any other Agreement Document to
which such entity is a party, any Periodic Report or any other
information or report delivered by the Transferor pursuant hereto,
which shall have been false or incorrect in any material respect when
made or deemed made and any losses, if any, relating to Receivables
included in the Receivables Pool as Eligible Receivables that were 60
days or more past due on the date of their inclusion and any amounts
relating to dilutions on Eligible Receivables included in the
Receivables Pool;
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(iii) the failure by the Transferor or the Seller to
comply with any applicable law, rule or regulation with respect to any
Pool Receivable or the related Contract, or the nonconformity of any
Pool Receivable or the related Contract with any such applicable law,
rule or regulation;
(iv) the failure to vest and maintain vested in the
Agent, on behalf of the Purchaser and the Bank Investors, an undivided
percentage ownership interest, to the extent of each Undivided Interest
owned by them hereunder, in the Receivables in, or purporting to be in,
the Receivables Pool, free and clear of any Adverse Claim, other than
an Adverse Claim arising solely as a result of an act of the Agent, on
behalf of the Purchaser or any Bank Investor, or any assignee therefrom
(when used in this CLAUSE (IV), an Adverse Claim shall include any lien
for taxes whether accrued and payable or not), whether existing at the
time of any Purchase or Reinvestment of Undivided Interest or at any
time thereafter;
(v) the failure to file, or any delay in filing,
financing statements or other similar instruments or documents under
the UCC of any applicable jurisdiction or other applicable laws with
respect to any Receivables in, or purporting to be in, the Receivables
Pool, whether at the time of any Purchase or Reinvestment or at any
time thereafter;
(vi) any dispute, claim, offset or defense (other
than discharge in bankruptcy) of the Obligor to the payment of any
Receivable in, or purporting to be in, the Receivables Pool (including,
without limitation, a defense based on such Receivable's or the related
Contract's not being a legal, valid and binding obligation of such
Obligor enforceable against it in accordance with its terms), or any
other claim resulting from the sale of the merchandise or services
related to such Receivable or the furnishing or failure to furnish such
merchandise or services;
(vii) any products liability claim or personal injury
or property damage suit or other similar or related action arising out
of or in connection with merchandise or services that are the subject
of any Pool Receivable; or
(viii) any tax or governmental fee or charge
(including, without limitation, all intangibles and similar taxes and
all other taxes, but not including taxes upon or measured by net income
or any portion thereof), all interest and penalties thereon or with
respect thereto, and all out-of-pocket costs and expenses, including
the reasonable fees and expenses of counsel in defending against the
same, which may arise by reason of the purchase or ownership of any
Undivided Interest, or any other interest in the Pool Receivables or in
any goods which secure any such Pool Receivables.
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(b) SERVICER INDEMNITY. Without limiting any other rights
which any such Person may have hereunder or under applicable law, the Servicer
hereby agrees to indemnify each INDEMNIFIED PARTY, forthwith on demand from and
against any and all INDEMNIFIED AMOUNTS awarded against or incurred by any of
them arising out of or relating to this Agreement or the ownership, servicing or
funding of any Undivided Interest or in respect of any Receivable or any
Contract, EXCLUDING, HOWEVER, (a) Indemnified Amounts to the extent resulting
from gross negligence or willful misconduct on the part of such Indemnified
Party or (b) recourse (except as otherwise specifically provided in this
Agreement) for Defaulted Receivables and Delinquent Accounts. Without limiting
the foregoing, the Servicer shall indemnify each Indemnified Party for
Indemnified Amounts arising out of or relating to:
(i) the breach of any representation or warranty made
by the Servicer (or any of its officers) under or in connection with
this Agreement, any other Agreement Document to which Servicer is a
party, any Periodic Report or any other information or report delivered
by the Servicer pursuant hereto, which shall have been false or
incorrect in any material respect when made or deemed made and any
losses, if any, relating to Receivables included in the Receivables
Pool as Eligible Receivables that were 60 days or more past due on the
date of their inclusion and any amounts relating to dilutions on
Eligible Receivables included in the Receivables Pool;
(ii) the failure by the Servicer to comply with any
applicable law, rule or regulation with respect to any Pool Receivable
or the related Contract, or the nonconformity of any Pool Receivable or
the related Contract with any such applicable law, rule or regulation;
and
(iii) any failure of the Servicer to perform its
duties or obligations in accordance with the provisions of Article
VIII.
SECTION 14.2. CONTEST OF TAX CLAIM; AFTER-TAX BASIS. If any
Indemnified Party shall have notice of any attempt to impose or collect any tax
or governmental fee or charge for which indemnification will be sought from the
Transferor under SECTION 14.1(A)(IX), such Indemnified Party shall give prompt
and timely notice of such attempt to the Transferor and the Transferor shall
have the right, at its expense, to conduct or participate in any proceedings
resisting or objecting to the imposition or collection of any such tax,
governmental fee or charge. Indemnification hereunder shall be in an amount
necessary to make the Indemnified Party whole after taking into account any tax
consequences to the Indemnified Party of the payment of any of the aforesaid
taxes and the receipt of the indemnity provided hereunder or of any refund of
any such tax previously indemnified hereunder, including the effect
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of such tax or refund on the amount of tax measured by net income or profits
which is or was payable by the Indemnified Party.
SECTION 14.3. CONTRIBUTION. If for any reason the
indemnification provided above in this SECTION 14.3 is unavailable to an
Indemnified Party or is insufficient to hold an Indemnified Party harmless, then
the Transferor shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, claim, damage or liability in such
proportion as is appropriate to reflect not only the relative benefits received
by such Indemnified Party on the one hand and the Transferor on the other hand
but also the relative fault of such Indemnified Party as well as any other
relevant equitable considerations.
ARTICLE XV
MISCELLANEOUS
SECTION 15.1. AMENDMENTS, ETC. Any provision of this Agreement
or any other Agreement Document may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Transferor, the Servicer,
the Purchaser and the Bank Investors, as applicable (and, if ARTICLE IX or the
rights or duties of the Agent are affected thereby, by the Agent); PROVIDED that
no such amendment or waiver shall, unless signed by each Bank Investor directly
affected thereby, (i) increase the Commitment of a Bank Investor, (ii) reduce
the Aggregate Purchaser's Investment or rate of interest to accrue thereon or
any fees or other amounts payable hereunder, (iii) postpone any date fixed for
the payment of any Scheduled distribution in respect of Aggregate Purchaser's
Investment or interest with respect thereto or any fees or other amounts payable
hereunder or for termination of any Commitment, (iv) change the percentage of
the Commitments or the number of Bank Investors, which shall be required for the
Bank Investors or any of them to take any action under this Section or any other
provision of this Agreement, (v) release all or substantially all of the
property with respect to which a security or ownership interest therein has been
granted hereunder to the Agent or the Bank Investors or (vi) extend or permit
the extension of the Commitment Termination Date. In the event the Agent
requests the Purchaser's or a Bank Investor's consent pursuant to the foregoing
provisions and the Agent does not receive a consent (either positive or
negative) from the Purchaser or such Bank Investor within 10 Business Days of
the Purchaser's or Bank Investor's receipt of such request, then the Purchaser
or such Bank Investor (and its percentage interest hereunder) shall be
disregarded in determining whether the Agent shall have obtained sufficient
consent hereunder.
SECTION 15.2. NOTICES, ETC. All notices and other
communications provided for hereunder shall, unless otherwise
stated herein, be in writing (including Telex and facsimile
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communication) and shall be personally delivered or sent by certified mail,
postage prepaid, or by Telex, or by facsimile, to the intended party at the
address or Telex or facsimile number of such party set forth under its name on
the signature pages hereof or at such other address or Telex or facsimile number
as shall be designated by such party in a written notice to the other parties
hereto. All such notices and communications shall be effective, (a) if
personally delivered, when received, (b) if sent by certified mail, three
Business Days after having been deposited in the mail, postage prepaid, (c) if
sent by overnight courier, one Business Day after having been given to such
courier, (d) if transmitted by Telex, when sent, answerback confirmed, and (e)if
transmitted by facsimile, when sent, receipt confirmed by telephone or
electronic means, except that notices and communications pursuant to ARTICLE I
shall not be effective until received.
SECTION 15.3. NO WAIVER; REMEDIES. No failure on the part of
the Agent, NationsBank, any Affected Party, any Indemnified Party, the
Purchaser, any Bank Investor or any other holder of any Undivided Interest to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law. Without limiting the foregoing, each of NationsBank
and any Enterprise Liquidity Provider or Enterprise Credit Support Provider is
hereby authorized by the Transferor at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by NationsBank, Enterprise Liquidity
Provider or Enterprise Credit Support Provider to or for the credit or the
account of the Transferor, now or hereafter existing under this Agreement, to
the payment of any amounts owed by the Transferor hereunder to the Agent, any
Affected Party, any Indemnified Party or the Purchaser, any Bank Investor or
their respective successors and assigns; PROVIDED, HOWEVER, that none of
NationsBank, Enterprise Liquidity Provider or Enterprise Credit Support Provider
shall, through the exercise of such setoff or otherwise, obtain payment with
respect to any amounts due to it (or their respective successors and assigns)
which results in its or their receiving more than their PRO RATA share of the
aggregate of such amounts due hereunder.
SECTION 15.4. BINDING EFFECT; SURVIVAL. This Agreement shall
be binding upon and inure to the benefit of the Transferor, the Servicer, the
Agent, the Purchaser, the Bank Investors and their respective successors and
assigns, and the provisions of SECTION 4.2 and ARTICLE XIII shall inure to the
benefit of the Affected Parties and the Indemnified Parties, respectively, and
their respective successors and assigns; PROVIDED, HOWEVER, nothing in the
foregoing shall be deemed to authorize any assignment not
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permitted by SECTION 13.1. This Agreement shall create and constitute the
continuing obligations of the parties hereto in accordance with its terms, and
shall remain in full force and effect until such time, after the Commitment
Termination Date, as all Undivided Interests shall have been reduced to zero.
The rights and remedies with respect to any breach of any representation and
warranty made by the Transferor or the Servicer pursuant to ARTICLE VI and the
indemnification and payment provisions of ARTICLE XIV and SECTIONS 4.2, 15.5 and
15.7 shall be continuing and shall survive any termination of this Agreement.
SECTION 15.5. COSTS, EXPENSES AND TAXES. In addition to
its obligations under ARTICLE XIII, the Transferor agrees to pay on
demand:
(a) all costs and expenses incurred by the Agent, the
Purchaser, each Bank Investor, NationsBank, the Enterprise Liquidity
Provider, the Enterprise Credit Support Provider and their respective
Affiliates in connection with the negotiation, preparation, execution
and delivery, the administration (including periodic auditing) or the
enforcement of, or any actual or claimed breach of, or any amendment to
or waiver of any provision contained in this Agreement, the Certificate
of Assignments and the other Agreement Documents, including, without
limitation (i) the reasonable fees and expenses of counsel to any of
such Persons incurred in connection with any of the foregoing or in
advising such Persons as to their respective rights and remedies under
any of the Agreement Documents, and (ii) all reasonable out-of-pocket
expenses (including reasonable fees and expenses of independent
accountants) incurred in connection with any review of the Transferor's
books and records either prior to the execution and delivery hereof or
pursuant to SECTION 7.1(C); and
(b) all stamp and other taxes and fees payable or
determined to be payable in connection with the execution, delivery,
filing and recording of this Agreement, the Certificate of Assignments
or the other Agreement Documents, and agrees to indemnify each
Indemnified Party against any liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes and fees.
SECTION 15.6. NO PROCEEDINGS. The Transferor and NationsBank,
individually and as Agent, each hereby agrees that it will not institute against
the Purchaser or any Bank Investor or join any other Person in instituting
against the Purchaser any insolvency proceeding (namely, any proceeding of the
type referred to in the definition of Event of Bankruptcy) so long as any
Commercial Paper Notes issued by the Purchaser shall be outstanding or there
shall not have elapsed one year plus one day since the last day on which any
such Commercial Paper Notes shall have been outstanding. The foregoing shall not
limit the Transferor's right
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to file any claim in or otherwise take any action with respect to any insolvency
proceeding that was instituted by any Person other than the Transferor.
SECTION 15.7. NATIONSBANK PROGRAM CONFIDENTIALITY. Each party
hereto (other than NationsBank) acknowledges that NationsBank regards the
structure of the transactions contemplated by this Agreement, and by the
Enterprise Liquidity Agreement and Enterprise Credit Support Agreement and its
other program documents referred to therein, to be proprietary, and each such
party severally agrees that:
(a) unless NationsBank shall otherwise agree in writing, and
except as provided in SUBSECTION (B), such party will not disclose to
any other person or entity:
(i) any information regarding, or copies of, this
Agreement or any transaction contemplated hereby,
(ii) any information regarding the organization or
business of Enterprise generally, or
(iii) any information regarding NationsBank which is
designated by NationsBank to such party in writing or
otherwise as confidential or not otherwise available to the
general public;
(b) such party will make the Information available to
only such of its officers, directors, employees and agents who (A) in
the good faith belief of such party, have a need to know such
Information, (B) are informed by such party of the confidential nature
of the Information and the terms of this SECTION 15.7, and (C) are
subject to confidentiality restrictions consistent with this SECTION
15.7;
(c) such party will use the Information solely for
the purposes of evaluating, administering and enforcing the
transactions contemplated by this Agreement and making any necessary
business judgments with respect thereto; and
(d) such party will, upon demand, return (and cause
its representatives to return) to NationsBank, or to such other
Information Provider as shall have furnished it with any Information,
all documents or other written material received from NationsBank or
such other Information Provider which constitute or contain any
Information described in SUBCLAUSE (B) or (C) of CLAUSE (I) above and
all copies of such documents or other material in its possession or in
the possession of any of its representatives, and will not retain any
copy, summary or extract thereof on any storage medium whatsoever.
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(e) Notwithstanding CLAUSE (I) of SUBSECTION (A),
each party may disclose any Information:
(i) to its attorneys, consultants and
auditors who (A) in the good faith belief of such party, have
a need to know such Information, (B) are informed by such
party of the confidential nature of the Information and the
terms of this SECTION 15.7, and (C) are subject to
confidentiality restrictions consistent with this SECTION
15.7,
(ii) to any other party to this Agreement,
for the purposes contemplated hereby or to any rating agency
then rating the Commercial Paper Notes,
(iii) as may be required by any municipal,
state, federal or other regulatory body having or claiming to
have jurisdiction over such party, in order to comply with any
law, order, regulation, regulatory request or ruling
applicable to such party, or
(iv) Subject to SUBSECTION (C), in the event
such party is legally compelled (by interrogatories, requests
for information or copies, subpoena, civil investigative
demand or similar process) to disclose such Information.
(f) In the event that any party hereto or any one to
whom such party or its representatives transmits the Information is
requested or becomes legally compelled (by interrogatories, requests
for information or documents, subpoena, civil investigative demand or
similar process) to disclose any of the Information, such party will
(or will cause its representatives to): provide NationsBank with prompt
written notice so that (A) Enterprise, NationsBank, or any other
Information Provider may seek a protective order or other appropriate
remedy, or (B) NationsBank may, if it so chooses, agree that such party
(or its representatives) may disclose such Information pursuant to such
request or legal compulsion.
(g) unless NationsBank agrees that such Information
may be disclosed, make a timely objection to the request or compulsion
to provide such Information on the basis that such Information is
confidential and subject to the agreements contained in this SECTION
15.7;
(h) take any action as NationsBank or any other
Information Provider may reasonably request to seek a protective order
or other appropriate remedy, PROVIDED that, in connection therewith,
such party shall have first received such assurances as it may
reasonably request that NationsBank
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or such other Information Provider shall reimburse such party's or its
representatives' reasonable costs and expenses or provide such other
assistance as such party or its representatives may reasonably
require; and
(i) in the event that such protective order or other
remedy is not obtained, or NationsBank agrees that such Information may
be disclosed, furnish only that portion of the Information which is
legally required to be furnished, and, provided such party (or its
representative) is reimbursed or assisted as referred to in CLAUSE
(III) above, exercise best efforts to obtain reliable assurance that
confidential treatment will be accorded the Information.
This SECTION 15.7 shall survive termination of this Agreement.
SECTION 15.8. CONFIDENTIALITY OF THE TRANSFEROR INFORMATION.
(a) Each party hereto (other than the Transferor) acknowledges
that certain of the information provided to such party by or on behalf
of the Transferor in connection with this Agreement and the
transactions contemplated hereby is or may be confidential, and each
such party severally agrees that, unless the Transferor shall otherwise
agree in writing, and except as provided in SUBSECTION (B), such party
will not disclose to any other person or entity:
(i) any information regarding, or copies of, any Periodic
Reports, and any non-public financial statements, reports and other
information, furnished by the Transferor to the Purchaser, any Bank
Investor or the Agent pursuant to SECTION 3.4, 5.1(M), 5.1(N), 6.1(I),
6.1(J), 7.1(C) or 7.2, or
(ii) any other information regarding the Transferor, Servicer,
Seller and any Originator which is designated by the Transferor to such
party in writing or otherwise as confidential;
the information referred to in CLAUSES (I) AND (II), above, furnished by the
Transferor or any attorney for or other representative of the Transferor (each
a "TRANSFEROR INFORMATION PROVIDER"), is collectively referred to as the
"TRANSFEROR INFORMATION;" PROVIDED, HOWEVER, the "TRANSFEROR INFORMATION" shall
not include:
(i) any information which is or becomes generally available to
the general public or to such party on a nonconfidential basis from a
source other than the Transferor or any other Transferor Information
Provider, or which was known to such party on a nonconfidential basis
prior to its
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disclosure by the Transferor or any other Transferor Information
Provider), or
(ii) general information regarding the nature of this
Agreement, the basic terms hereof (including without limitation the
amount and nature of the Purchaser's Investments or any Bank Investor's
hereunder and of the recourse or other credit enhancement provided by
the Transferor hereunder), the nature, amount and status of the Pool
Receivables, and the current and/or historical ratios of losses to
liquidations and/or outstandings with respect to the Receivables Pool,
and the identity of the Transferor.
(b) Notwithstanding SUBSECTION (A), each party may
disclose any Transferor Information:
(i) to any of such party's attorneys, consultants and
auditors, and to such of the Enterprise Liquidity Provider, Enterprise
Credit Support Provider, assignee, any dealer or placement agent for
the Purchaser's commercial paper, and any actual or potential assignees
of, or participants in, any of the rights or obligations of the
Purchaser, Enterprise Liquidity Provider or Enterprise Credit Support
Provider, NationsBank under or in connection with this Agreement, who
(A) in the good faith belief of such party, have a need to know such
the Transferor Information, (B) are informed by such party of the
confidential nature of the Transferor Information and the terms of this
SECTION 15.8, and (C) are subject to confidentiality restrictions
generally consistent with this SECTION 15.8,
(ii) to any rating agency that maintains a rating for
the Purchaser's commercial paper or is considering the issuance of such
a rating, for the purposes of reviewing the credit of the Purchaser in
connection with such rating,
(iii) to any other party to this Agreement, for the
purposes contemplated hereby,
(iv) as may be required by any municipal, state,
federal or other regulatory body having or claiming to have
jurisdiction over such party, in order to comply with any law, order,
regulation, regulatory request or ruling applicable to such party, or
(v) subject to SUBSECTION (C), in the event such
party is legally compelled (by interrogatories, requests for
information or copies, subpoena, civil investigative demand or similar
process) to disclose such the Transferor Information.
(c) In the event that any party hereto (other than the
Transferor) or any of its representatives is requested or becomes
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legally compelled (by interrogatories, requests for information or documents,
subpoena, civil investigative demand or similar process) to disclose any of the
Transferor Information, such party will (or will cause its representatives to):
(i) provide the Transferor with prompt written notice
so that (A) the Transferor or any other the Transferor Information
Provider may seek a protective order or other appropriate remedy, or
(B) the Transferor may, if it so chooses, agree that such party (or its
representatives) may disclose such the Transferor Information pursuant
to such request or legal compulsion;
(ii) unless the Transferor agrees that such the
Transferor Information may be disclosed, make a timely objection to the
request or compulsion to provide such the Transferor Information on the
basis that such the Transferor Information is confidential and subject
to the agreements contained in this SECTION 15.8;
(iii) take any action as the Transferor or any other
the Transferor Information Provider may reasonably request to seek a
protective order or other appropriate remedy, PROVIDED that, in
connection therewith, such party shall have first received such
assurances as it may reasonably request that the Transferor or such
other the Transferor Information Provider shall reimburse such party's
or its representatives, reasonable costs and expenses or provide such
other assistance as such party or its representatives may reasonably
require; and
(iv) in the event that such protective order or other
remedy is not obtained, or the Transferor agrees that such the
Transferor Information may be disclosed, furnish only that portion of
the Transferor Information which is legally required to be furnished,
and, provided such party (or its representative) is reimbursed or
assisted as referred to in CLAUSE (III) above, exercise best efforts to
obtain reliable assurance that confidential treatment will be accorded
the Transferor Information.
This SECTION 15.8 shall survive termination of this Agreement.
SECTION 15.9. CAPTIONS AND CROSS REFERENCES. The various
captions (including, without limitation, the table of contents) in this
Agreement are provided solely for convenience of reference and shall not affect
the meaning or interpretation of any provision of this Agreement. Unless
otherwise indicated, references in this Agreement to any Section, Appendix,
Schedule or Exhibit are to such Section of or Appendix, Schedule or Exhibit to
this Agreement, as the case may be, and references in any Section, subsection,
or
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clause to any subsection, clause or subclause are to such subsection, clause or
subclause of such Section, subsection or clause.
SECTION 15.10. INTEGRATION. This Agreement contains a final
and complete integration of all prior expressions by the parties hereto with
respect to the subject matter hereof and shall constitute the entire Agreement
among the parties hereto with respect to the subject matter hereof, superseding
all prior oral or written understandings.
SECTION 15.11. GOVERNING LAW. THIS AGREEMENT, INCLUDING THE
RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.
SECTION 15.12. WAIVER OF JURY TRIAL. THE TRANSFEROR AND
SERVICER HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT THE CERTIFICATE
OF ASSIGNMENTS, ANY OTHER AGREEMENT DOCUMENT OR UNDER ANY AMENDMENT, INSTRUMENT
OR DOCUMENT DELIVERED OR WHICH MAY BE IN THE FUTURE BE DELIVERED IN CONNECTION
HEREWITH OR ARISING FROM ANY BANKING OR OTHER RELATIONSHIP EXISTING IN
CONNECTION WITH THIS AGREEMENT, THE CERTIFICATE OF ASSIGNMENTS OR ANY OTHER
AGREEMENT DOCUMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED
BEFORE A COURT AND NOT A JURY TRIAL.
SECTION 15.13. CONSENT TO JURISDICTIONS WAIVER OF IMMUNITIES.
EACH OF THE TRANSFEROR AND SERVICER, THE PURCHASER, EACH BANK INVESTOR AND AGENT
HEREBY ACKNOWLEDGES AND AGREES THAT:
(a) IT IRREVOCABLY (i) SUBMITS TO THE JURISDICTION, FIRST, OF
ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL JURISDICTION IS
NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE SITTING IN
NEW YORK CITY, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT OF
SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED ONLY IN SUCH NEW
YORK STATE OR FEDERAL COURT AND NOT IN ANY OTHER COURT, AND (iii)
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF
AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING.
(b) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS
(WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO
ITSELF OR ITS PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN
RESPECT OF ITS OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT.
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SECTION 15.14. EXECUTION IN COUNTERPARTS. This Agreement may
be executed in any number of counterparts and by the different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Agreement.
SECTION 15.15. PURCHASER'S LIABILITIES. The obligations of the
Purchaser hereunder are solely the corporate obligations of the Purchaser and no
personal liability shall attach to or be incurred by Xxxxxxx Xxxxx Money Markets
Inc. or any stockholder, employee, officer, director or incorporator of the
Purchaser, and the Transferor and Servicer expressly waive any claim based on
such personal liability. No recourse shall be had for an obligation or claim
arising out of or based upon this Agreement against Xxxxxxx Xxxxx Money Markets
Inc. or against any stockholder, employee, officer, director or incorporator of
the Purchaser. This SECTION 15.15 shall not relieve any such Person of any
liability it might otherwise have for its own gross negligence or willful
misconduct.
SECTION 15.16. AGENT'S LIABILITIES. The obligations of the
Agent hereunder are solely the corporate obligations of such Agent and no
personal liability shall attach to or be incurred by the Agent or any
stockholder, employee, officer, director or incorporator of the Agent, and the
Transferor and Servicer expressly waive any claim based on such personal
liability. No recourse shall be had for an obligation or claim arising out of or
based upon this Agreement against NationsBank or against any stockholder,
employee, officer, director or incorporator of either of them; PROVIDED THAT,
this SECTION 15.16 shall not relieve any such Person of any liability it might
otherwise have for its own gross negligence or willful misconduct.
SECTION 15.17. DELEGATION OF SERVICER'S DUTIES. Wackenhut, as
Servicer, may at any time, with the consent of the Agent, delegate to an
Affiliate of Wackenhut any of its servicing obligations hereunder, PROVIDED
HOWEVER that no such delegation shall operate to relieve the Servicer of any of
its liabilities hereunder.
SECTION 15.18. CHARACTERIZATION OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT. It is the intention of the parties hereto that
the transactions contemplated hereby constitute the sale of the Undivided
Interests, conveying good title thereto free and clear of any Liens to the
Purchaser and the Bank Investors, as the case may be and that the Undivided
Interests not be part of the Transferor's estate in an Event of Bankruptcy. If,
notwithstanding the foregoing, the transactions contemplated hereby are deemed a
financing, the parties intend that the Transferor shall be deemed to have
granted to the Agent, for the benefit of the Purchaser and the Bank Investors
and the Transferor hereby grants to the Agent, for the benefit of the Purchaser
and the Bank Investors, a first priority perfected security interest in all of
the Transferor's
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right, title and interest in, to and under the Receivables, together with
Related Security and Collections with respect thereto and under the Receivables
Purchase Agreement, and that this Agreement shall constitute a security
agreement under applicable law.
- SIGNATURE PAGES FOLLOW -
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
date first above written.
WACKENHUT FUNDING CORPORATION,
as the Transferor
By
--------------------------------------
Title
----------------------------------
0000 Xxxxxxxxx Xxxxx, Xx. 000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
THE WACKENHUT CORPORATION,
as Servicer
By
--------------------------------------
Title
----------------------------------
0000 Xxxxxxxxx Xxxxx, Xx. 000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxx
Telephone: (000) 000-0000
ENTERPRISE FUNDING CORPORATION,
as Purchaser
By
--------------------------------------
Title
----------------------------------
c/o Merrill Xxxxx Money Markets Inc.
World Financial Center - South Tower
000 Xxxxxxx Xxxxxx - 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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NATIONSBANK, N.A.,
as Agent
By
--------------------------------------
Title: Senior Vice President
000 Xxxxx Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Structured Finance Group
Xxxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Commitment: NATIONSBANK, N.A.,
$61,200,000__________ as Bank Investor
By
--------------------------------------
Title: Senior Vice President
000 Xxxxx Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Structured Finance Group
Xxxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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APPENDIX A
DEFINITIONS
This is APPENDIX A to the Transfer and Administration Agreement dated
as of December 30, 1997 among Wackenhut Funding Corporation, The Wackenhut
Corporation, and Enterprise Funding Corporation, and NationsBank, N.A., as Agent
(as amended, supplemented or otherwise modified from time to time, this
"AGREEMENT"). Each reference in this APPENDIX A to any Section, Appendix or
Exhibit refers to such Section of or Appendix or Exhibit to this Agreement.
A. DEFINED TERMS. As used in this Agreement, unless the context
requires a different meaning, the following terms have the meanings indicated
hereinbelow:
"ADJUSTED AVERAGE MATURITY" has the meaning set forth in
APPENDIX B.
"AGENT" has the meaning set forth in the preamble.
"ADVERSE CLAIM" means a lien, security interest, charge, or
encumbrance, or other right or claim of any Person other than (a) a potential
claim or right (that has not yet been asserted) of a trustee appointed for an
Obligor in connection with any Event of Bankruptcy or (b) an unfiled lien for
taxes accrued but not yet payable.
"AFFECTED PARTY" means each of the Purchaser, any Bank Investor, the
Enterprise Liquidity Provider, each Enterprise Credit Support Provider, any
other Person providing credit or liquidity support to the Purchaser, or any Bank
Investor any permitted assignee of any Purchaser, any Bank Investor, Enterprise
Liquidity Provider, Enterprise Credit Support Provider or such other Person, any
assignee of any of the Purchaser's obligations to any Enterprise Liquidity
Provider, any Enterprise Credit Support Provider, any holder of a participation
interest in the rights and obligations of any Enterprise Liquidity Provider or
Enterprise Credit Support Provider, the Agent, NationsBank, and any holding
company of NationsBank.
"AFFILIATE" when used with respect to a Person, means any other Person
controlling, controlled by, or under common control with, such Person.
"AGGREGATE UNPAIDS" means, at any time, an amount equal to the sum of
(i) the aggregate Earned Discount at such time, (ii) the Aggregate Total
Investment at such time, and (iii) all other amounts owed (whether due or
accrued) hereunder by the Transferor to the Purchaser, the Bank Investors, or
the Agent at such time.
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88
"AGREEMENT DOCUMENTS" means this Agreement, the Purchase and Sale
Agreement, the Receivables Purchase Agreement, the Certificate of Assignments
and the other documents to be executed and delivered in connection herewith.
"AGGREGATE PURCHASER'S INVESTMENTS" means, at any time, with respect to
the Purchaser or the Bank Investors, as the case may be, the sum of the Dollar
amount of all of the Purchaser's Investments.
"AGGREGATE PURCHASER'S SHARE" shall have the meaning set forth
in SECTION 2.5.
"AGGREGATE REQUIRED ALLOCATIONS" at any time means the sum of
all Required Allocations of all Undivided Interests.
"AGGREGATE UNPAID BALANCE" has the meaning set forth in SECTION 2.1 of
the Purchase and Sale Agreement.
"ALTERNATE REFERENCE RATE" has the meaning set forth in
APPENDIX B.
"ASSIGNMENT AMOUNT" with respect to a Bank Investor shall mean at any
time an amount equal to the lesser of (i) such Bank Investor's PRO RATA portion
of the Aggregate Purchaser's Investment at such time and (ii) such Bank
Investor's unused Commitment.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" means an Assignment and
Assumption Agreement substantially in the form of Exhibit B attached hereto.
"AVERAGE MATURITY" has the meaning set forth in APPENDIX B.
"BANK COMMITMENT" means (i) with respect to each Bank Investor party
hereto, the commitment of such Bank Investor to make acquisitions from the
Transferor or the Purchaser in accordance herewith in an amount not to exceed
the dollar amount set forth opposite such Bank Investor's signature on the
signature page hereto under the heading "COMMITMENT", MINUS the dollar amount of
any Commitment or portion thereof assigned pursuant to an Assignment and
Assumption Agreement PLUS the dollar amount of any increase to such Bank
Investor's Commitment consented to by such Bank Investor prior to the time of
determination, (ii) with respect to any assignee of a Bank Investor party hereto
taking pursuant to an Assignment and Assumption Agreement, the commitment of
such assignee to make acquisitions from the Transferor or the Purchaser not to
exceed the amount set forth in such Assignment and Assumption Agreement MINUS
the dollar amount of any Commitment or portion thereof assigned pursuant to an
Assignment and Assumption Agreement prior to such time of determination and
(iii) with respect to any assignee of an assignee referred to in clause (ii),
the commitment of such assignee to make acquisitions from the Transferor or the
X-0
00
Xxxxxxxxx not to exceed the amount set forth in an Assignment and Assumption
Agreement between such assignee and its assign.
"BANK RATE" has the meaning set forth in APPENDIX B.
"BUSINESS DAY" means a day on which both (a) NationsBank at its office
in Charlotte, North Carolina is open for business and (b) commercial banks in
New York City are not authorized or required to be closed for business.
"CERTIFICATE OF ASSIGNMENTS" means each certificate of assignment, by
the Transferor to a Purchaser, in the form of EXHIBIT 5.1(A), evidencing an
Undivided Interest.
"COLLECTION ACCOUNT" shall have the meaning set forth in
SECTION 3.3(E).
"COLLECTIONS" means, with respect to any Receivable, all funds which
either (a) are received by the Transferor, any Originator or Servicer from or on
behalf of the related Obligors in payment of any amounts owed (including,
without limitation, purchase prices, finance charges, interest and all other
charges) in respect of such Receivable, or applied to such amounts owed by such
Obligors (including, without limitation, insurance payments that the Transferor,
each Originator or Servicer applies in the ordinary course of its business to
amounts owed in respect of such Receivable and net proceeds of sale or other
disposition repossessed goods or other collateral or property of the Obligor or
any other party directly or indirectly liable for payment of such Receivable and
available to be applied thereon), or (b) are deemed to have been received by the
Transferor, any Originator or any other Person as a Collection pursuant to
SECTION 3.3; PROVIDED THAT, prior to such time as Wackenhut shall cease to be
Servicer, late payment charges, collection fees and extension fees shall not be
deemed to be Collections.
"COMMERCIAL PAPER NOTES" means short-term promissory notes issued or to
be issued by the Purchaser to fund its investments in accounts receivable or
other financial assets.
"COMMERCIAL PAPER RATE" has the meaning set forth in APPENDIX B.
"COMMITMENT" has the meaning set forth in SECTION 1.1.
"COMMITMENT TERMINATION DATE" has the meaning set forth in
SECTION 1.5(A).
"CONCENTRATION LIMIT" has the meaning set forth in SECTION 2.3(B).
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90
"CONDITIONS PRECEDENT" has the meaning set forth in SECTION 5.2.
"CONSOLIDATED FUNDED DEBT" means all Funded Debt of Wackenhut and its
Subsidiaries determined on a consolidated basis eliminating intercompany items.
(a) any gains on the sale or other disposition of Investments
or fixed or capital assets, and any taxes on such excluded gains and
any tax deductions or credits on account of any such excluded losses;
(b) the proceeds of any life insurance policy except for
proceeds received during such period with respect to deferred
compensation plans to the extent that Seller or any Subsidiary
recognized any expenses during such period with respect to such plans;
(c) net earnings and losses of any Subsidiary accrued
prior to the date it became a Subsidiary;
(d) net earnings and losses of any corporation (other than a
Subsidiary), substantially all the assets of which have been acquired
in any manner by Wackenhut or any Subsidiary, realized by such
corporation prior to the date of such acquisition;
(e) net earnings and losses of any corporation (other than a
Subsidiary) with which Wackenhut or a Subsidiary shall have
consolidated or which shall have merged into or with Wackenhut or a
Subsidiary prior to the date of such consolidation or merger;
(f) net earnings of any business entity (other than a
Subsidiary) in which Wackenhut or any Subsidiary has an ownership
interest unless such net earnings shall have actually been received by
Wackenhut or such Subsidiary in the form of cash distributions;
(g) any portion of the net earnings of any Subsidiary
which for any reason is unavailable for payment of dividends
to Wackenhut or any other Subsidiary;
(h) earnings resulting from any reappraisal, revaluation
or write-up of assets;
(i) any deferred or other credit representing any excess of
the equity in any Subsidiary at the date of acquisition thereof over
the amount invested in such Subsidiary;
(j) any gain arising from the acquisition of any Securities
of Wackenhut or any Subsidiary; and
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91
(k) any reversal of any contingency reserve, except to the
extent that provision for such contingency reserve shall have been made
from income arising during such period.
"CONSOLIDATED NET WORTH" means at any time as of which the amount
thereof is to be determined, the sum of the following in respect of Wackenhut
and its Subsidiaries (on a consolidated basis and excluding intercompany items):
(i) the amount of issued and outstanding share capital, PLUS (ii) the amount of
additional paid-in capital and retained income (or, in the case of a deficit,
minus the amount of such deficit), MINUS (iii) the sum of the following (without
duplication of deductions in respect of items already deducted in arriving at
surplus and retained earnings): (A) all reserves, except legal reserves and
other contingency reserves (i.e., reserves not allocated to specific purposes
and not deducted from assets), which are properly treated as appropriations of
surplus or retained earnings; (B) any treasury stock, capital stock subscribed
and unissued and other contra-equity accounts; and (C) the cumulative amount of
any net write-up of asset values after the date of the audit immediately
preceding the date of revolver, plus or minus, as the case may be (iv) the
cumulative effect of foreign exchange valuations.
"CONSOLIDATED TOTAL ASSETS" means as of the date of any determination
thereof the total amount of all assets of Wackenhut and its Subsidiaries
determined on a consolidated basis in accordance with generally accepted
accounting principles.
"CONTRACT" means any writing evidencing a Receivable.
"CREDIT AND COLLECTION POLICY" shall mean the Servicer's credit and
collection policy or policies and practices, relating to Contracts and
Receivables existing on the date hereof and referred to in SECTION 8.2(A) and
described in SCHEDULE A-1, and as modified from time to time in compliance with
SECTION 7.3(C).
"CURRENT DEBT" of any Person as of the date of any determination
thereof means (i) all Indebtedness of such Person for borrowed money other than
Funded Debt of such Person and (ii) Guaranties by such Person of Current Debt of
others.
"DEFAULTED RECEIVABLE" means, without duplication, a Receivable: (a)
as to which any payment, or part thereof, remains unpaid for 120 days from the
original invoice date for such Receivable, (b) with regard to which an Event of
Bankruptcy has occurred and remains continuing, (c) as to which payments have
been extended, or the terms of payment thereof rewritten, or (d) which
consistent with the Credit and Collection Policy, would be fully reserved
against or required to be sent to attorneys or collection agencies or would be
charged-off the Transferor's or Servicer's books as uncollectible.
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"DELINQUENT RECEIVABLE" means a Receivable that is not a Defaulted
Receivable and: (a) as to which any payment, or part thereof, remains unpaid for
60 days or more from the original invoice date for such Receivable; or (b)
which, consistent with the Credit and Collection Policy, would be classified as
delinquent by the Transferor.
"DESIGNATED OBLIGOR" means, at any time, all Obligors of the Transferor
except any such Obligor as to which the Agent has, at least three Business Days
prior to the date of determination, given written notice to the Transferor that
such Obligor shall not be considered a Designated Obligor.
"DISCOUNT FACTOR" has the meaning set forth in APPENDIX B.
"DOMESTIC CD RATE (ADJUSTED)" has the meaning set forth in
APPENDIX B.
"EARNED DISCOUNT" has the meaning set forth in APPENDIX B.
"ELIGIBLE RECEIVABLE" means, at any time, a Receivable:
(a) which has been originated by an Originator and sold to Wackenhut
pursuant to (and in accordance with) the Purchase and Sale Agreement and has
been sold by Wackenhut to the Transferor pursuant to (and in accordance with)
the Receivables Purchase Agreement, and to which the Transferor has good title
thereto, free and clear of all address claims;
(b) which (together with the Collections), has been the subject of
either a valid transfer and assignment from the Transferor to the Agent, on
behalf of the Purchaser and the Bank Investors, all of the Transferor's right,
title and interest therein or the grant of a first priority security interest
therein (and in the Collections and Related Security) effective until the
termination of this Agreement;
(c) with regard to which the related service has been rendered and all
other obligations performed by the Transferor or an Originator (except as
permitted by Schedule 2.3(b)), as applicable, and which is generated by the
Transferor and the applicable Originator in the ordinary course of their
respective business of providing Services and is required to be paid in full by
the related Obligor within 30 days of the billing thereof;
(d) which, (i) if the perfection of the Agent's, on behalf of the
Purchaser and the Bank Investors, undivided ownership interest therein is
governed by the laws of a jurisdiction where the Uniform Commercial Code --
Secured Transactions is in force, constitutes an account or general intangible
as defined in the Uniform Commercial Code as in effect in such jurisdiction, and
(ii) if the perfection of the Agent's undivided ownership interest therein is
governed by
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the law of any jurisdiction where the Uniform Commercial Code -- Secured
Transactions is not in force, the Transferor has furnished to the Agent such
opinions of counsel and other evidence as has reasonably been requested,
establishing to the reasonable satisfaction of the Agent that the Agent's
undivided ownership interest and other rights with respect thereto are not
significantly less protected and favorable than such rights under the Uniform
Commercial code;
(e) which is a domestic Receivable, the Obligor of which is a
United States resident, and is not an Affiliate of any of the
parties hereto;
(f) the Obligor of which is a Designated Obligor;
(g) the Obligor of which is not the private sector Obligor of Defaulted
Receivables aggregating more than 15% of such Obligor's total obligations to the
Transferor and each Originator;
(h) which is not a Defaulted Receivable;
(i) with regard to which the warranty of the Transferor in
SECTION 6.1(L) is true and correct;
(j)(x) the sale of an undivided interest in which does not require the
consent of or notice to the related Obligor under the related Contract and does
not contravene or conflict with any law, and (y) in the case of Receivables
generated by an Originator, the sale of which to the Transferor does not
contravene or conflict with any law;
(k) which is an account receivable representing all or part of the
sales price of merchandise, insurance and services within the meaning of Section
3(c)(5) of the Investment Company Act of 1940, as amended;
(l) which arises out of a current transaction, or the proceeds of which
have been or are to be used for current transactions, within the meaning of
Section 3(a)(3) of the Securities Act of 1933, as amended;
(m) which is denominated and payable only in Dollars in the
United States;
(n) which arises under a Contract that has been duly authorized and
that, together with such Receivable, is in full force and effect and constitutes
the legal, valid and binding obligation of the Obligor of such Receivable
enforceable against such Obligor in accordance with its terms and is not subject
to any dispute, offset, counterclaim or defense whatsoever (except the discharge
in bankruptcy of such Obligor);
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(o) which, together with the Contract related thereto, does not
contravene in any material respect any laws, rules or regulations applicable
thereto (including, without limitation, laws, rules and regulations relating to
usury, truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy) and with respect
to which no party to the Contract related thereto is in violation of any such
law, rule or regulation in any material respect if such violation would impair
the collectibility of such Receivable;
(p) which (i) satisfies all applicable requirements of the Credit and
Collection Policy and (ii) complies with such other criteria and requirements
(other than those relating to the collectibility of such Receivable) as the
Agents may from time to time specify to the Transferor following thirty days,
notice;
(q) as to which the Agent has not notified the Transferor that the
Agent has determined, in its sole discretion, that such Receivable (or class of
Receivables) is not acceptable for purchase hereunder;
(r) which, if originated by Wackenhut, was originated in The
Wackenhut Corporation or Wackenhut Airline Services, Inc.;
(s) which does not include any amount payable for sales taxes,
Payroll taxes or any other tax; and
(t) the related Obligor of which is not, directly or indirectly, an
Affiliate of the Transferor or any Originator.
"ENTERPRISE CREDIT SUPPORT AGREEMENT" means any agreement between
Enterprise and the Enterprise Credit Support Provider evidencing the obligation
of the Enterprise Credit Support Provider to provide credit support to
Enterprise in connection with the issuance by Enterprise of Commercial Paper.
"ENTERPRISE CREDIT SUPPORT PROVIDER" means any Person or Persons who
are providing or will provide credit support to Enterprise in connection with
the issuance by Enterprise of Commercial Paper Notes, together with the
successors and assigns of any such Person or Persons.
"ENTERPRISE LIQUIDITY AGREEMENT" means any agreement between Enterprise
and the Enterprise Liquidity Provider evidencing the obligation of the Liquidity
Provider to provide liquidity support to Enterprise in connection with the
issuance by Enterprise of Commercial Paper Notes, as such agreement may be
modified, amended, supplemented or restated from time to time.
"ENTERPRISE LIQUIDITY PROVIDER" means any Person or Persons who are
providing or will provide liquidity support to Enterprise in connection with the
issuance by Enterprise of Commercial Paper
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Notes, together with the successors and assigns of any such Person or Persons.
"ERISA" means the U.S. Employee Retirement Income Security Act
of 1974, as amended from time to time.
"EURODOLLAR RATE (RESERVE ADJUSTED)" has the meaning set forth
in APPENDIX C.
"EVENT OF BANKRUPTCY" shall be deemed to have occurred with respect to
a Person if either:
(a) a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding
up, or composition or readjustment of debts of such Person, the
appointment of a trustee, receiver, custodian, liquidator, assignee,
sequestrator or the like for such Person or all or substantially all of
its assets, or any similar action with respect to such Person under any
law relating to bankruptcy, insolvency, reorganization, winding up or
composition or adjustment of debts, and such case or proceeding shall
continue undismissed, or unstayed and in effect, for a period of 60
consecutive days; or an order for relief in respect of such Person
shall be entered in an involuntary case under the federal bankruptcy
laws or other similar laws now or hereafter in effect; or
(b) such Person shall commence a voluntary case or other
proceeding under any applicable bankruptcy, insolvency, reorganization,
debt arrangement, dissolution or other similar law now or hereafter in
effect, or shall consent to the appointment of or taking possession by
a receiver, liquidator, assignee, trustee, custodian, sequestrator (or
other similar official) for, such Person or for any substantial part of
its property, or shall make any general assignment for the benefit of
creditors, or shall fail to, or admit in writing its inability to, pay
its Debts generally as they become due, or, if a corporation or similar
entity, its board of directors shall vote to implement any of the
foregoing.
"FACILITY" has the meaning set forth in SECTION 1.1 of the
Purchase and Sale Agreement.
"FACILITY FEE" has the meaning set forth in the fee letter.
"FACILITY LIMIT" means an amount equal to $61,200,000.
"FEDERAL RESERVE BOARD" means the Board of Governors of the Federal
Reserve System, or any successor thereto or to the functions thereof.
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"FEE LETTERS" has the meaning set forth in SECTION 4.1(A).
"FIXED CHARGES" for any period means on a consolidated basis the sum of
(i) 100% of Rentals (other than Rentals on Capitalized Leases) payable during
such period by Wackenhut and its Subsidiaries other than WCC and (ii) all
Interest Charges on all indebtedness (including, without duplication, the
interest component of Rentals on Capitalized Leases and the Earned Discount and
fees and expenses payable under this Agreement) of Wackenhut and its
Subsidiaries other than WCC payable during said period by Wackenhut.
"FUNDED DEBT" of any Person shall mean (i) all Indebtedness of such
Person for borrowed money or which has been incurred in connection with the
acquisition of assets, including all payments in respect thereof that are
required to be made within one year from the date of any determination of Funded
Debt, whether or not the obligation to make such payments shall constitute a
current liability to the obligor under GAAP, (ii) all Capitalized Rentals of
such Person (iii) all Guaranties by such Person of Funded Debt of others,(iv)
with respect to Funded Debt of Wackenhut, the product of (x) the aggregate
amounts available for drawing under all outstanding Letters of Credit, and
(y).50; and (v) to the extent not otherwise included in clauses (i) through (iv)
above, the Aggregate Total Investments.
"GOVERNMENT OBLIGOR" means a department, agency, bureau, division or
instrumentality of the United States of America or any state thereof or the
District of Columbia or any county or municipal government chartered or
otherwise existing by authority of any of the foregoing, or any department,
agency, bureau, division or instrumentality thereof obligated to make payments
with respect to a Receivable.
"GROSS REVENUES" for any period means the gross revenues, determined in
accordance with generally accepted accounting principles, of Wackenhut and its
Subsidiaries for such period, determined on a consolidated basis after
eliminating revenues attributable to outstanding minority Interests.
"HEADQUARTERS" shall mean the Transferor's office located at
0000 Xxxxxxxxx Xxxxx, Xx. 000, Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000.
"INDEMNIFIED AMOUNTS" has the meaning set forth in SECTION 14.1.
"INDEMNIFIED PARTY" has the meaning set forth in SECTION 14.1.
"INITIAL PURCHASER" means the Transferor as Initial Purchaser under the
Purchase and Sale Agreement.
"INFORMATION" has the meaning set forth in SECTION 15.7.
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"INFORMATION PROVIDER" has the meaning set forth in SECTION 15.7.
"INTEREST COMPONENT" shall mean, (i) with respect to any Related
Commercial Paper issued on an interest-bearing basis, the interest payable on
such Related Commercial Paper at its maturity and (ii) with respect to any
Related Commercial Paper issued on a discount basis, the portion of the face
amount of such Related Commercial Paper representing the discount incurred in
respect thereof (including any dealer commissions to the extent included as part
of such discount).
"INVESTMENTS" means all investments, in cash or by delivery of Property
made, directly or indirectly in any Person, whether by acquisition of shares of
capital stock, indebtedness or other obligations or Security or by loan,
advance, capital contribution or otherwise; PROVIDED, HOWEVER, that
"Investments" shall not mean or include routine investments in Property to be
used or consumed in the ordinary course of business or investments in accounts
receivable or notes receivable arising in the ordinary course of business.
"INVOLUNTARY FEDERAL PROCEEDING" has the meaning set forth in
SECTION 10.2(B).
"LETTER OF CREDIT ISSUER" means NationsBank as issuer of a Letter of
Credit.
"LOCK-BOX AGREEMENT" means a letter agreement, in substantially the
form of EXHIBIT 5.1(H), between the Transferor and any Lock-Box Bank.
"LOCK-BOX BANK" means any of the banks holding one or more lock-box
accounts for receiving Collections from Pool Receivables.
"LOSSES" means, at any time, with respect to the Receivables Pool, the
sum of (x) all Receivables theretofore fully reserved against by the Transferor
or Servicer plus (y), without duplication, all Receivables theretofore sent to
attorneys or collection agencies to be collected plus (z), without duplication,
all Receivables theretofore charged-off the Transferor's or Servicer's books as
uncollectible.
"LOSSES TO LIQUIDATIONS RATIO" means the percentage that (x) Losses
during the three fiscal month period ending on the most recent Month End Date on
all Pool Receivables owned by the Transferor was of (y) Collections of such Pool
Receivables during such period.
"LOSS RESERVE DISCOUNT" has the meaning set forth in SECTION 2.1 of the
Purchase and Sale Agreement.
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"MAXIMUM PURCHASE LIMIT" has the meaning set forth in clause
(x)of Section 1.2(A).
"MONTH END DATE" means the last day of each fiscal month.
"NEGATIVE SPREAD FEE" has the meaning set forth in APPENDIX B.
"NET ASSET TEST" shall mean in connection with any assignment by the
Purchaser to the Bank Investors of an interest in the Aggregate Purchaser's
Investment pursuant to Section 13.5 hereof, that as of the day immediately
preceding the day on which such transfer is to take effect, the Net Pool Balance
shall be greater than or equal to the Aggregate Purchaser's Investment.
"NET POOL BALANCE" has the meaning set forth in SECTION 2.3(A).
"NET WORTH" shall mean the Net Pool Balance minus the Aggregate
Purchaser's Investment minus the outstanding principal balance of the Initial
Purchaser's Note minus all other liabilities of the Transferor.
"NOTE FEE" has the meaning set forth in SECTION 4.1(E).
"OBLIGOR" means a Person (including any Affiliate of such Person)
obligated to make payments with respect to a Receivable.
"ORIGINATOR" means, at any time, each Subsidiary of the Seller at such
time a signatory to the Purchase and Sale Agreement.
"ORIGINATOR RECEIVABLE" means the indebtedness owed to any
Originator by any Obligor (without giving effect to any purchase under the
Purchase and Sale Agreement by The Wackenhut Corporation and any purchase under
the Receivables Purchase Agreement by Wackenhut Funding Corporation, in each
case, at any time) under a Contract.
"PERIODIC REPORT" means a report in substantially the form of
SCHEDULE 3.4 (A) .
"PERSON" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or limited liability partnership, government
or any agency or political subdivision thereof or any other entity.
"POOL RECEIVABLE" means a Receivable in the Receivables Pool.
"PROGRAM FEE" shall have the meaning set forth in the Fee Letter.
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"PROPERTY" means any interest in any kind of property or asset, whether
real, personal or mixed, and whether tangible or intangible.
"PURCHASE" has the meaning set forth in SECTION 1.1(A).
"PURCHASE AND SALE AGREEMENT" means that certain Amended and Restated
Purchase and Sale Agreement dated as of December 30, 1997 between the Seller as
Initial Purchaser and Wackenhut Airline Services, Inc. and each other Affiliate
of the Seller from time to time a party thereto, as the same may be amended and
otherwise modified from time to time.
"PURCHASE AND SALE INDEMNIFIED AMOUNTS" has the meaning set forth in
SECTION 9.1 of the Purchase and Sale Agreement
"PURCHASE AND SALE INDEMNIFIED PARTIES" has the meaning set forth in
forth in SECTION 9.1 of the Receivable Purchase Agreement.
"PURCHASE LIMIT" has the meaning set forth in SECTION 1.2(A).
"PURCHASE PRICE" has the meaning set forth in SECTION 2.1 of
the Purchase and Sale Agreement.
"PURCHASE TERMINATION DATE" has the meaning set forth in SECTION 1.6.
"PURCHASER" has the meaning set forth in the PREAMBLE.
"PURCHASER RATE" has the meaning set forth in APPENDIX B.
"PURCHASER'S INVESTMENT" has the meaning set forth in SECTION 2.2.
"PURCHASER'S SHARE" has the meaning set forth in SECTION 2.4.
"RATE VARIANCE FACTOR" has the meaning set forth in APPENDIX B.
"RECEIVABLE" means (i) the indebtedness owed to any Originator by any
Obligor (without giving effect to any purchase under the Purchase and Sale
Agreement by the Seller at any time) under a Contract and sold by any such
Originator to the Seller pursuant to the Purchase and Sale Agreement and sold by
the Seller to the Transferor pursuant to the Receivables Purchase Agreement, and
(ii) the indebtedness owed to the Seller by any Obligor (without giving effect
to any purchase under the Receivables Purchase Agreement by the Transferor at
any time) under a Contract and sold by the Seller to the Transferor pursuant to
the Receivables Purchase Agreement, in each case whether constituting an
account, chattel paper, instrument, investment property or general intangible,
arising in connection with the sale or lease of merchandise or the rendering
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of Services by any Originator or the Seller, and includes the right to payment
of any interest or Finance Charges and other obligations of such Obligor with
respect thereto.
"RECEIVABLE PURCHASE TERMINATION DATE" has the meaning set forth in
SECTION 1.4 of the Receivable Purchase Agreement.
"RECEIVABLE PURCHASE TERMINATION EVENTS" has the meaning set forth in
SECTION 8.1 of the Receivable Purchase Agreement.
"RECEIVABLES POOL" means at any time all then outstanding Receivables
which (a) arose from or relate to a Contract, and (b) as to which the Obligors
thereunder are Designated Obligors. If a Receivable is a Pool Receivable on the
day immediately preceding the Commitment Termination Date, such Receivable shall
continue to be considered a Pool Receivable at all times thereafter.
"RECEIVABLES PURCHASE AGREEMENT" means that certain Purchase Agreement
dated as of December 30, 1997, between the Seller and the Transferor, with
respect to the purchase of the Pool Receivables by the Transferor, as the same
may be altered or supplemented from time to time.
"REGULATION D" means Regulation D of the Federal Reserve Board, or any
other regulation of the Federal Reserve Board that prescribes reserve
requirements applicable to nonpersonal time deposits or "Eurocurrency
Liabilities" as presently defined in Regulation D, as in effect from time to
time.
"REGULATORY CHANGE" means, relative to any Affected Party:
(a) any change in (or the adoption, implementation,
phase-in or commencement of effectiveness of) any:
(i) United States federal or state law or foreign
law applicable to such Affected Party;
(ii) regulation, interpretation, directive,
requirement or request (whether or not having the force of
law) applicable to such Affected Party of (A) any court,
government authority charged with the interpretation or
administration of any law referred in CLAUSE (A)(I) or of (3)
any fiscal, monetary or other authority having jurisdiction
over such Affected Party; or
(iii) generally accepted accounting principles or
regulatory accounting principles applicable to such Affected
Party and affecting the application to such Affected Party of
any law, regulation, interpretation, CLAUSE (A)(I) or (A)(II)
above; or
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(x) any change in the application to such Affected Party of
any existing law, regulation, interpretation, directive, requirement,
request or accounting principles referred to in CLAUSE (A)(I), (A)(II)
or (A)(III) above.
"REINVESTMENT" has the meaning set forth in SECTION 1.01(B).
"REINVESTMENT TERMINATION DATE" means the second Business Day after the
delivery by the Purchaser to the Transferor of written notice that the Purchaser
elects to commence the amortization of its Purchaser's Investment or otherwise
liquidate its interest in the Receivables Pool.
"RELATED COMMERCIAL PAPER" shall mean Commercial Paper issued by the
Purchaser the proceeds of which were used to acquire, or refinance the
acquisition of, an interest in Receivables with respect to the Transferor.
"RELATED SECURITY" means, with respect to any Receivable, Seller
Receivable, or Originator Receivable, as the xxxxx may be: (a) all of the
Transferor's right, title and interest in and to all Contracts or other
agreements that relate to such Receivable; (b) all of the Transferor's interest
in the merchandise (including returned merchandise), if any, relating to the
sale which gave rise to such Receivable; (c) all other security interests or
liens and property subject thereto from time to time purporting to secure
payment of such Receivable, whether pursuant to the Contract related to such
Receivable or otherwise; (d) the assignment to any Agent, for the benefit of
Purchaser and any assignee, of all UCC financing statements covering any
collateral securing payment of such Receivable (but such assignment is made only
to the extent of the interest of the Purchaser in the respective Receivable);
and (e) all guarantees and other agreements or arrangements of whatever
character from time to time supporting or securing payment of such Receivable
whether pursuant to the Contract related to such Receivable or otherwise. The
interest of the Purchaser in any Related Security is only to the extent of the
Purchaser's Undivided interest, as more fully described in the definition of an
Undivided Interest.
"REMAINING COLLECTIONS" has the meaning set forth in SECTION
3.01(A)(II).
"RENTALS", with respect to any lease, means and includes as of the date
of any determination thereof, all fixed payments (including as such all
payments which the lessee is obligated to make to the lessor on termination of
the lease or surrender of the Property) payable by Wackenhut or a Subsidiary, as
lessee or sublessee under a lease of real or personal property, but shall be
exclusive of any amounts required to be paid by Wackenhut or a Subsidiary
(whether or not designated as rents or additional rents) on account of
maintenance, repairs, insurance, taxes and similar
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charges. Fixed rents under any so-called "percentage leases" shall be computed
solely on the basis of the minimum rents, if any, required to be paid by the
lessee regardless of sales volume or gross revenues.
"REQUIRED ALLOCATIONS" has the meaning set forth in SECTION 2.01.
"REQUIRED ALLOCATIONS LIMIT" has the meaning set forth in
SECTION 1.02(B).
"RESERVE PERCENTAGE" has the meaning set forth in APPENDIX B.
"RESTRICTED INVESTMENTS" means all Investments in any Person, other
than:
(a) Investments by Wackenhut and its Subsidiaries in and to
Subsidiaries, including any investment in a corporation which, after
giving effect to such Investments, will become a Subsidiary;
(b) Investments in (i) commercial paper maturing in 270 days
or less from the date of issuance and which, at the time of acquisition
by Wackenhut or any Subsidiary, is accorded one of the two highest
ratings by Standard & Poor's Corporation or Xxxxx'x Investors Service,
Inc.; (ii) Variable Rate Demand Notes of issuers whose commercial
paper, at the time of acquisition, is accorded one of the two highest
ratings by Standard & Poor's Corporation or Xxxxx'x Investors Service,
inc.; or (iii) Direct obligations of any State of the United States of
America or of any political subdivision thereof located in the United
States of America and which, at the time of acquisition, is accorded
one of the two highest ratings by Standard & Poor's Corporation or
Xxxxx'x Investors Service, Inc., maturing in twelve months or less from
the date of acquisition;
(c) Investments in direct obligations of the United States of
America, or investments in any Person, which Investments are guaranteed
by the full faith and credit of the United States of America, in either
case maturing in twelve months or less from the date of acquisition
thereof by Wackenhut or any Subsidiary;
(d) Investments in certificates of deposit maturing within one
year from the date of issuance thereof, issued by a bank or trust
company organized under the laws of the United States or any state
thereof, having capital, surplus and undivided profits aggregating at
least $100,000,000 and whose long-term certificates of deposit are, at
the time of acquisition thereof by Wackenhut or any Subsidiary, rated
A by
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Standard & Poor's Corporation or A by Xxxxx'x Investors Service, Inc.;
(e) Loans or advances in the usual and ordinary course of
business to officers, directors and employees for expenses (including
moving expenses related to a transfer) incidental to carrying on the
business of Wackenhut or any Subsidiary; PROVIDED, HOWEVER that
Wackenhut may make up with aggregate at any one time outstanding, up to
$300,000 of such loans or advances which are not incidental to carrying
on the business of Wackenhut or any Subsidiary;
(f) receivables arising from the sale of goods and
services in the ordinary course of business of Wackenhut and
its Subsidiaries; and
(g) PROVIDED, HOWEVER, that with respect to investments made
by or on behalf of Titania Insurance Company of America, a Vermont
Corporation, the following shall not be Restricted Investments;
(1) Certificates of deposit, time deposits and banker's
acceptance maturing within one year from the date of
acquisition, issued by a bank or trust company
organized under the laws of the United States or any
state thereof, or any foreign bank whose branch is
organized under-the laws of the United States or any
state thereof, having capital, surplus and undivided
profits aggregating at least $100,000,000 and whose
long-term certificates of deposit are, at the time of
acquisition, rated at least A by Standard & Poor's
Corporation or Xxxxx'x Investors Service, Inc.;
(2) Repurchase Agreements with any domestic bank with
debt rated 'AA' or better by Standard & Poor's
Corporation, or any foreign bank rated at least 'AA'
by Standard & Poor's Corporation and 'Aa' by Xxxxx'x
Investors Service, Inc.; or repurchase agreements
with such other Persons on such terms as Wackenhut
and Agent shall agree in writing; provided the term
of all such repurchase agreements is for one year or
less;
(3) Direct obligations of the United States of America,
or Investments in any Person, which Investments are
guaranteed by the full faith and credit of the United
States of America;
(4) Mortgage-backed securities issued by the United
States Government or any agency or instrumentality
thereof, having at the time of acquisition, a
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credit rating of at least AA by a nationally
recognized rating service;
(5) Bonds, notes and other direct obligations (other than
those referred to in clause (b), above) of any
corporation domiciled in the United States of
America, or a State of the United State of America,
or of any sovereign or supranational institution
whose obligations are denominated in United States
dollars, at the time of acquisition rated at least A
by a nationally recognized rating service.
Obligations of sovereign or supranational
institutions at the time of acquisition, shall be
rated at least AA by a nationally recognized rating
service;
(6) Preferred stock obligations of any corporation
domiciled in the United States of America, whose
obligations at the time of acquisition are rated at
least A by a nationally recognized rating service;
(7) Shares in mutual funds that invest solely in
investments of the types described in clause (b)(i),
clause (b)(iii), clause (3), clause (4), clause (5)
and/or clause (6) above and have assets in excess of
$100,000,000;
(8) Any Investments (other than the Investments set forth
in clause (b) and clause (1) through clause (7)
inclusive, above), provided that the aggregate fair
value for all such investments shall not, at any
time, exceed five percent (5%) of the aggregate fair
value of all Investments set forth in clause (1)
through (8) inclusive, above. For the purposes of
this subsection (8) only, fair value shall mean the
greater of book value or fair market value.
In valuing any investments for the purpose of applying the limitations
set forth in this Agreement, such investments, loans and advances shall be taken
at the original cost thereof, without allowance for any subsequent write-offs or
appreciation or depreciation therein, but less any amount repaid or recovered on
account of capital or principal.
For purposes of this Agreement, at any time when a corporation becomes
a Subsidiary, all Investments of such corporation at such time shall be deemed
to have been made by such corporation, as a Subsidiary, at such time.
"RUN OFF DAY" for any Undivided Interest means any of (a) each day
which occurs on or after the date designated by any Agent to the Transferor to
be the "Run Off Commencement Date", provided such date is designated on at least
one Business Day's notice during a
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time when any of the conditions set forth in SECTION 5.02 are not satisfied, and
on or before the date, if any, designated by the Agent in its sole discretion on
at least one Business Day's notice to the Transferor as the "Run Off Termination
Date", and (b) each day which occurs on or after the Termination Date for such
Undivided Interest.
"RUN OFF DISCOUNT" has the meaning set forth in APPENDIX B.
"RUN OFF PERIOD" means one or more successive Run Off Days.
"RUN OFF SERVICER'S FEE" has the meaning set forth in APPENDIX B.
"SCHEDULED COMMITMENT TERMINATION DATE" has the meaning set
forth in SECTION 1.02(A).
"SECURITY" shall have the same meaning as in Section 2(l) of the
Securities Act of 1933, as amended.
"SELLER RECEIVABLES" means (i) the indebtedness owed to any Originator
by any Obligor (without giving effect to any purchase under the Purchase and
Sale Agreement by The Wackenhut Corporation and any purchase under the
Receivables Purchase Agreement by Wackenhut Funding Corporation, in each case,
at any time) under a Contract and sold by any such Originator to the The
Wackenhut Corporation pursuant to the Purchase and Sale Agreement, and (ii) the
indebtedness owed to The Wackenhut Corporation by any Obligor (without giving
effect to any purchase under the Receivables Purchase Agreement by Wackenhut
Funding Corporation, at any time) under a Contract, in each case, and sold by
The Wackenhut Corporation to Wackenhut Funding Corporation pursuant to the
Receivables Purchase Agreement, in each case whether constituting an account,
chattel paper, instrument, investment property or general intangible, arising
in connection with the sale or lease of merchandise or the rendering of Services
by any Originator or the Wackenhut Corporation, and includes the right to
payment of any interest or Finance Charges and other obligations of such Obligor
with respect thereto.
"SERVICER" initially means The Wackenhut Corporation, and thereafter
the Person determined pursuant to SECTION 8.01(A).
"SERVICER TRANSFER EVENT" has the meaning set forth in SECTION 8.01(B).
"SERVICER'S FEE", has the meaning set forth in APPENDIX B.
"SERVICER'S FEE RESERVE" has the meaning set forth in APPENDIX B.
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"SERVICES" means (i) security related services (including, without
limitation, physical security, investigations, transit security, nuclear site
security, emergency protection and similar services) and (ii) corrections
related services (including, without limitation, correctional facility guard,
food and similar services).
"SETTLEMENT DATE" means the last day of each Settlement Period.
"SETTLEMENT PERIOD" for any Undivided Interest means
(a) each period commencing on the first day of each Yield
Period for such Undivided Interest and ending on the last day of such
Yield Period; and
(b) on and after the Termination Date for such Undivided
Interest, such period (including, without limitation, a daily period)
as shall be selected from time to time by the Agent or, in absence of
any such selection, each period of thirty days from the next preceding
Settlement Date;
PROVIDED, HOWEVER, that
(i) with respect to any Yield Period of one day (as described
in CLAUSE (II) of the PROVISO of the definition of "Yield Period"), the
related Settlement Period shall be the first day following such Yield
Period;
(ii) any Settlement Period which would otherwise end on a day
which is not a Business Day shall be extended to the next succeeding
Business Day; and
(iii) the last Settlement Period shall end on the date on
which all Undivided Interests have been reduced to zero.
"SOLVENT" shall mean, when used with respect to any Person, that at the
time of determination: (i) the fair value of its assets (both at fair valuation
and present fair saleable value) is in excess of the total amount of its
liabilities, including, without limitation, contingent liabilities; (ii) it is
then able and expects to be able to pay its debts as they mature; and (iii) it
has capital sufficient to carry on its business as conducted and as proposed to
be conducted.
"SPECIAL CONCENTRATION LIMIT" has the meaning set forth in
SECTION 2.3(C).
"SUCCESSOR NOTICE" has the meaning set forth in SECTION 8.1(B).
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"TERMINATION DATE" for any Undivided Interest means the
Commitment Termination Date.
"TERMINATION EVENT" has the meaning set forth in SECTION 10.1.
"THREE-MONTH DEFAULT RATIO" means the ratio (expressed as a percentage)
computed as of any Month End Date by dividing (x) the aggregate Unpaid Balance
of all Defaulted Receivables calculated as at each of the three most recent
Month End Dates less Losses (without giving effect to CLAUSE (Z) of the
definition thereof) at the three preceding fiscal Month End Dates by (y) the
aggregate Unpaid Balance of all Pool Receivables calculated as at each of the
three most recent Month End Dates less Losses (without giving effect to CLAUSE
(Z) of the definition thereof) at the three most recent fiscal Month End Dates.
"THREE-MONTH DILUTION RATIO" means the ratio (expressed as a
percentage) computed as of each Month End Date by dividing (x) the aggregate
reduction in the Unpaid Balance of all Pool Receivables arising from dilutive
credits during the three immediately preceding fiscal months by (y) Collections
of Pool Receivables received during such period.
"TOTAL CAPITALIZATION" means the sum of (i) Consolidated Funded Debt
PLUS (ii) Consolidated Net Worth.
"TRANSFEROR" has the meaning set forth in the PREAMBLE.
"TRANSFEROR INFORMATION" has the meaning set forth in SECTION 15.8.
"TRANSFEROR INFORMATION PROVIDER" has the meaning set forth in
SECTION 15.8.
"UCC" means the Uniform Commercial Code as from time to time in effect
in the applicable jurisdiction or jurisdictions.
"UNDIVIDED INTEREST" has the meaning set forth in SECTION 2.1.
"UNMATURED TERMINATION EVENT" means any event which, with the giving of
notice or lapse of time, or both, would become a Termination Event.
"UNPAID BALANCE" of any Receivable means at any time the SUM of (x) the
unpaid principal amount thereof, PLUS (y) the unpaid amount of all finance
charges, interest payments and other amounts actually accrued thereon at such
time, but EXCLUDING, in the case of CLAUSE (Y) next above, all late payment
charges, delinquency charges, and extension or collection fees.
"WACKENHUT" has the meaning set forth in the preamble.
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"WACKENHUT FAMILY" means (i) Xxxxxx X. Xxxxxxxxx, Xxxx X. Xxxxxxxxx,
Xxxxxxx X. Xxxxxxxxx and other lineal descendants of Xxxxxx X. Xxxxxxxxx, the
founder of Wackenhut; (ii) the spouses and lineal descendants of the persons
named in clause (i); and (iii) the estates or legal representatives of the
persons named in clause (i).
"WCC" means Wackenhut Corrections Corporation, a Florida
corporation.
"YIELD PERIOD" means with respect to any Undivided Interest
(or portion thereof):
(a) the period commencing on the date of the initial Purchase
of such Undivided Interest (or such portion) and ending such number of
days thereafter (not to exceed 100 days) as the applicable Managing
Agent shall select, after consultation with the Transferor, pursuant
to SECTIONS 1.03 or 2.01(B); and
(b) thereafter, each period commencing on the last day of the
immediately preceding Yield Period for such Undivided Interest (or such
portion) and ending such number of days thereafter (not to exceed 100
days) as the Agent shall select, after consultation with the
Transferor;
PROVIDED, HOWEVER, that
(i) any such Yield Period (other than a Yield Period
consisting of one day) which would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day
(unless the related Undivided Interest shall be accruing Earned
Discount at a rate determined by reference to the Eurodollar Rate
(Reserve Adjusted), in which case if such succeeding Business Day is in
a different fiscal month, such Yield Period shall instead be shortened
to the next preceding Business Day);
(ii) in the case of Yield periods of one day for any Undivided
Interest, (A) the Initial Yield Period shall be the day of the related
Purchase; and (B) any subsequently occurring Yield Period which is one
day shall, if the immediately preceding Yield Period is more than one
day, be the last day of such immediately preceding Yield Period, and if
the immediately preceding Yield Period is one day, shall be the next
day following such immediately preceding Yield Period.
The "RELATED" Yield Period for any Undivided Interest at any time means the
Yield Period pursuant to which Earned Discount is then accruing for such
Undivided Interest.
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B. OTHER TERMS. All accounting terms not specifically defined herein
shall be construed in accordance with generally accepted accounting principles.
All terms used in Article 9 of the UCC in the State of New York, and not
specifically defined herein, are used herein as defined in such Article 9.
C. COMPUTATION OF TIME PERIODS. Unless otherwise stated in this
Agreement, in the computation of a period of time from a specified date to a
later specified date, the word "from" means "from and including" and the words
"to" and "until" each means "to but excluding".
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XXXXXXXX X
CALCULATION OF DISCOUNT AND RESERVE
This is APPENDIX B to the Transfer and Administration Agreement dated
as of December 30, 1997 among Wackenhut Funding Corporation, The Wackenhut
Corporation, Enterprise Funding Corporation and NationsBank, N.A. (as amended,
supplemented or otherwise modified from time to time, the "Agreement").
Capitalized terms used in this APPENDIX B without definition have the meanings
assigned to such terms in APPENDIX A or APPENDIX C to the Agreement. Each
reference in this APPENDIX B to any Section refers to such Section of the
Agreement. Each reference in this APPENDIX B to any Part refers to the part of
this APPENDIX B so designated.
PART I
DISCOUNT FACTOR
Sub-
PART TERM PAGE NO.
---- ---- --------
A. Discount Factor................................................. B-2
B. Earned Discount................................................. B-2
C. Negative Spread Fee............................................. B-3
D. Run Off Discount................................................ B-3
E. Rate Definitions................................................ B-4
Alternate Reference Rate.................................. B-4
Bank Rate................................................. B-5
Commercial Paper Rate..................................... B-5
Domestic CD Rate (Adjusted)............................... B-5
Domestic CD Rate.......................................... B-6
Assessment Rate........................................... B-6
Reserve Requirement....................................... B-6
Eurodollar Rate (Reserve Adjusted)........................ B-8
Purchaser Rate............................................ B-9
F. Rate Variance Factor............................................ X-00
X-0
000
XXXX XX
XXXX XXXXXXX; DILUTION RESERVE
Sub-
PART TERM PAGE NO.
---- ---- --------
A. Loss Reserve B-10
B. Reserve Percentage.............................................. B-10
C. Dilution Reserve................................................ B-10
PART III
SERVICER'S FEE RESERVE
A. Servicer's Fee Reserve.......................................... B-11
B. Servicer's Fee.................................................. B-11
C. Run Off Servicer's Fee.......................................... B-10
PART IV
ADJUSTED AVERAGE MATURITY
A. Adjusted Average Maturity....................................... B-12
B. Average Maturity................................................ B-12
------------------------------------
PART I
DISCOUNT FACTOR
A. DISCOUNT FACTOR. The "DISCOUNT FACTOR" for a related Undivided
Interest at any time in a Yield Period means an amount determined as follows:
DF = ED + ROD
WHERE:
DF = the Discount Factor of such Undivided Interest at such time;
ED = Earned Discount of such Undivided Interest accrued and unpaid
at such time, as determined pursuant to PART I.B;
ROD = Run Off Discount of such Undivided Interest at such time, as
determined pursuant to PART I.D.
B. EARNED DISCOUNT. The "EARNED DISCOUNT" for any
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Undivided Interest for each day in a related Yield Period means an amount
determined as follows:
ED = [PI x (PR + PF) x 1/360] + NSF (if any);
ED = Earned Discount of such Undivided Interest (or such portion)
accrued on such day;
PI = the Purchaser's Investment of such Undivided Interest (or
such portion) on such day, as determined pursuant to
SECTION 2.02;
PR = the Purchaser Rate for such Undivided Interest (or such
portion) on such day, as defined in PART I.E.;
PF = the Program Fee consisting of the fee as calculated
pursuant to the Fee Letters; and
NSF = the Negative Spread Fee for such Undivided Interest or such
portion thereof) on such day, as defined in PART C.
No provision of the Agreement shall require the payment or permit the collection
of Earned Discount in excess of the maximum permitted by applicable law. Earned
Discount for any Undivided Interest shall not be considered paid by any
distribution if at any time such distribution is rescinded or must otherwise be
returned for any reason.
C. NEGATIVE SPREAD FEE. The "NEGATIVE SPREAD FEE" means, for each
Undivided Interest (or portion thereof) for each day in any Yield Period during
which any Run Off Day or Termination Date for such Undivided Interest occurs,
the amount, if any, by which;
(i) the additional Earned Discount (calculated
without taking into account any Negative Spread Fee) which
would have accrued on the reductions of the related
Purchaser's Investment of such Undivided Interest (or such
portion) during such Yield Period (as so computed) if such
reductions had remained as Purchaser's Investment exceeds,
(ii) the income, if any, received by the owner of
such Undivided Interest (or such portion) from such owner's
investing the proceeds of such reductions of Purchaser's
Investment.
D. RUN OFF DISCOUNT. The "RUN OFF DISCOUNT" for the related Undivided
Interest at any time means an amount determined as follows:
ROD = PI X (PR + RVF) X AAM
---------------------
360
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WHERE:
ROD = the Run Off Discount for such Undivided Interest at
such time;
PI = the Purchaser's Investment of such Undivided Interest
at such time;
PR = the Purchaser Rate for such Undivided Interest for a Yield
Period deemed to commence at such time pursuant to PART I.E;
AAM = the Adjusted Average Maturity of the Receivables Pool
related to such Undivided Interest, as determined pursuant
to PART V; and
RVF = the Rate Variance Factor deemed to be in effect at such
time, as determined pursuant to PART I.F.
E. RATE DEFINITIONS. The "ALTERNATE REFERENCE RATE" means, on any date,
a fluctuating rate of interest PER ANNUM equal to the higher of
(a) the rate of interest most recently announced by
NationsBank at its office in Charlotte, North Carolina as its reference
rates from time to time, changing when and as said reference rates
change (such reference rates are not necessarily the lowest or best
rate charged by NationsBank) and
(b) the Federal Funds Rate (as defined below) most recently
determined by NationsBank plus 1.0% PER ANNUM.
For purposes of this definition, "FEDERAL FUNDS RATE" means, for any period, a
fluctuating interest rate PER ANNUM equal (for each day during such period) to
(i) the weighted average of the rates on overnight federal
funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York; or
(ii) if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day on such
transactions received by NationsBank from three federal funds brokers
of recognized standing selected by it.
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The Alternate Reference Rate is not necessarily intended to be the lowest rate
of interest determined by BofA or NationsBank in connection with extensions of
credit.
"BANK RATE" for any Yield Period for the related Undivided Interest of
any Purchaser or Bank Investor, as the case may be, means an interest rate PER
ANNUM equal to the sum of (a) 0.50% PER ANNUM, PLUS (b) if the Fixed Charge
Coverage Ratio is at such time less than 1.75:1, .15% PER ANNUM, PLUS (c) the
Eurodollar Rate (Reserve Adjusted) of such Purchaser for such Yield Period;
PROVIDED, HOWEVER, that if (i) it shall become unlawful for the Agent, any
Enterprise Liquidity Provider or Enterprise Credit Support Provider to obtain
funds in the London interbank eurodollar market in order to fund any Purchase or
to maintain any Undivided Interest, or if such funds shall not be reasonably
available to the Agent, Enterprise Liquidity Provider or Enterprise Credit
Support Provider or (ii) there shall not be time prior to the commencement of an
applicable Yield Period to determine a Eurodollar Rate in accordance with its
terms, then the "BANK RATE" for any Yield Period for such Undivided Interest
shall be equal to a rate of (x) 0.50% PER ANNUM, (y) the Domestic CD Rate
(Adjusted) for such Yield Period PLUS (z) if the Fixed Charge Coverage Ratio is
at such time less than 1.75:1, .15% PER ANNUM ("DEALER FEE").
"COMMERCIAL PAPER RATE" for any Yield Period for the related Undivided
Interest means a rate PER ANNUM equal to the sum of (i) the rate or, if more
than one rate, the weighted average of the rates, determined by converting to an
interest-bearing equivalent rate PER ANNUM the discount rate (or rates) at which
Commercial Paper Notes having a term equal to such Yield Period and to be issued
to fund the Purchase of or to maintain such Undivided Interest by the Purchaser
purchasing such Undivided Interest (including, without limitation, Purchaser's
Investment and accrued and unpaid Earned Discount) may be sold by any placement
agent or commercial paper dealer selected by the Agent, as agreed between each
such dealer and the Agent, PLUS (ii) the greater of (A) the commissions and
charges charged by such placement agent or commercial paper dealer with respect
to such Commercial Paper Notes and (B) .05% times the face amount of such
Commercial Paper Notes, expressed as a percentage of such face amount and
converted to an interest-bearing equivalent rate PER ANNUM.
"ASSESSMENT RATE" for purposes of this definition and for any
Yield Period means the annual assessment rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of l%)
applicable to NationsBank on its insured deposits, on the
Business Day immediately preceding the first day of such Yield
Period, under the Federal Deposit Insurance Act, determined by
annualizing the most recent assessment levied on NationsBank
by the Federal Deposit Insurance Corporation (together with
any successor, the "FDIC" with respect to such deposits after
giving effect
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to the most recent rebate granted to such Managing Agent by
the FDIC with respect to deposit-insurance as well as the loss
to NationsBank (determined in the good faith judgment of
NationsBank) of the use of such rebate prior to the date a
credit is taken by NationsBank with respect to such rebate.
"RESERVE REQUIREMENT" means, for purposes of this definition
and with respect to any Yield Period, a percentage (expressed
as a decimal) equal to the daily average during such Yield
Period of the aggregate reserve requirement (including all
basic, supplemental, marginal and other reserves and taking
into account any transitional adjustments or other Scheduled
changes in reserve requirements during such period) specified
under Regulation D, as applicable to the class of banks of
which NationsBank is a member, at deposits of the types used
as a reference in determining the Domestic CD Rate and having
a maturity approximately equal to such Yield Period.
"DOMESTIC CD RATE (ADJUSTED)" means, with respect to any Yield Period,
a rate PER ANNUM equal to the sum (rounded upwards, if necessary, to the nearest
1/100 of 1%) of (A) the rate obtained by dividing (x) the Enterprise CD Rate for
such Yield Period by (y) a percentage equal to 100% minus the stated maximum
rate for all reserve requirements as specified in Regulation D (including
without limitation any marginal, emergency, supplemental, special or other
reserves) that would be applicable during such Yield Period to a negotiable
certificate of deposit in excess of $100,000, with a maturity approximately
equal to such Yield Period, of any member bank of the Federal Reserve System
plus (B) the then daily net annual assessment rate (rounded upward, if
necessary, to the nearest 1/100 of 1%) as estimated by NationsBank, the
Enterprise Liquidity Provider or the Enterprise Credit Support Provider, as
applicable, for determining the current annual assessment payable by it to the
FDIC for insuring such certificates of deposit;
WHERE, for purposes of this definition:
"EURODOLLAR RATE (RESERVE ADJUSTED)" means, with respect to Undivided
Interests owned or otherwise funded by NationsBank, Enterprise, any Enterprise
Liquidity Provider or any Enterprise Credit Support Provider and with respect to
any Yield Period for any related Undivided Interest (or portion thereof), a rate
per annum (rounded upwards, if necessary, to the nearest 1/100 of it) of (A) the
rate obtained by dividing (i) the applicable LIBO Rate by (ii) a percentage
equal to 100% minus the reserve percentage used for determining the maximum
reserve requirement as specified in Regulation D (including without limitation
any marginal, emergency, supplemental, special or other reserves) that is
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applicable to the Enterprise Liquidity Provider during such Yield Period in
respect of eurocurrency or eurodollar funding, lending or liabilities (or, if
more than one percentage shall be so applicable, the daily average of such
percentage for those days in such Yield Period during which any such percentage
shall be applicable) plus (B) the then daily net annual assessment rate (rounded
upwards, if necessary, to the nearest 1/100 of 1%) as estimated by the
Enterprise Liquidity Provider for determining the current annual assessment
payable by the Liquidity Provider to the FDIC in respect of eurocurrency or
eurodollar funding, lending or liabilities;
WHERE:
"LIBOR RATE" means, with respect to any Yield Period, the rate
at which deposits in dollars are offered to NationsBank, the
Enterprise Liquidity Provider or the Enterprise Credit Support
Provider in the London interbank market at approximately
11:00 a.m. (London time) two Enterprise Eurodollar Business
Days before the first day of such Yield Period in an amount
approximately equal to the Purchaser's Investment for a
related Undivided Interest to which the Eurodollar Rate
(Reserve Adjusted) is to apply and for a period of time
approximately equal to the applicable Yield Period.
"ENTERPRISE CD RATE" means, with respect to any Yield Period
for any related Undivided Interest owned or otherwise funded
by NationsBank, Enterprise, any Enterprise Liquidity Provider
or any Enterprise Credit Support Provider, the average of the
bid rates determined by NationsBank, the Enterprise Liquidity
Provider or the Enterprise Credit Support Provider, as
applicable, per annum, at approximately 10:00 a.m. (New York
City time) on the Business Day before the first day of such
Yield Period for which such Domestic CD Rate (Adjusted) is to
be applicable, of two or more New York certificate of deposit
dealers of recognized standing selected by NationsBank, the
Enterprise Liquidity Provider or the Enterprise Credit Support
Provider, as applicable, for the purchase in New York from the
Enterprise Liquidity Provider or the Enterprise Credit Support
Provider, as applicable, at face value of certificates of
deposit of the Enterprise Liquidity Provider or the Enterprise
Credit Support Provider, as applicable, in an aggregate amount
approximately comparable to the amount of Enter prise's
Purchaser's Investment for the related Undivided Interest (or
portion thereof) to which such Domestic CD Rate (Adjusted) is
to be applicable and with a maturity approximately equal to
the applicable Yield Period.
"PURCHASER RATE" for any Yield Period for any related
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Undivided Interest (or portion thereof) of any Purchaser means:
(a) in the case of an Undivided Interest (or portion thereof)
of any Purchaser other than one referred to in CLAUSE (B) of this
definition, the Commercial Paper Rate of such Purchaser for such
Undivided Interest (or such portion) for such Yield Period; and
(b) in the case of an Undivided Interest (or portion thereof)
owned or funded by a Bank Investor, an Enterprise Liquidity Provider or
an Enterprise Credit Support Provider, the Bank Rate of such Purchaser
for such Undivided Interest (or such portion) for such Yield Period;
PROVIDED, HOWEVER, that on any day when any Termination Event or Unmatured
Termination Event shall have occurred and be continuing, the Purchaser Rate
shall mean a rate PER ANNUM equal to the Alternate Reference Rate in effect on
such day plus 2% PER ANNUM.
F. RATE VARIANCE FACTOR. The "RATE VARIANCE FACTOR" means, during any
Yield Period, such percentage PER ANNUM not exceeding 2% as the Agents may
designate from time to time in their sole discretion.
PART II
LOSS RESERVE
A. LOSS RESERVE. The "LOSS RESERVE" of any Undivided Interest on any
day means the greater of (x) $3,000,000 and (y) an amount determined as follows:
LR = RP x (PI + DF)
WHERE:
LR = the Loss Reserve of such Undivided Interest on such
day;
RP = the Reserve Percentage at the close of business of
Purchaser on such day, as determined pursuant to
PART II.B;
PI = the related Purchaser's Investment of such Undivided
Interest at the opening of business of Purchaser on
such day, as determined pursuant to SECTION 1.3; and
DF = the Discount Factor of such Undivided Interest at
the close of business of Purchaser on such day, as
determined pursuant to PART I.A.
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B. RESERVE PERCENTAGE. The "RESERVE PERCENTAGE" means, for the related
Undivided Interest on any day, the greatest of (i) three times the most recent
Three-Month Default Ratio, (ii) 1.5 times the percentage that the largest
Special Concentration Limit set forth on SCHEDULE 2.3(C) bears to the then
Aggregate Unpaid Balance of Eligible Receivables and (iii) 10%.
C. DILUTION RESERVE. The "DILUTION RESERVE" for the related Undivided
Interest on any day means an amount equal to the product of (x) the sum of the
related Purchaser's Investment of such Undivided Interest at the close of
business of Purchaser on such day, as determined pursuant to SECTION 1.03 and
(y) the greater of (i) 2% and (ii) 1.5 times the highest Three-Month Dilutions
Ratio calculated on the Month End Date for each of the six fiscal months
preceding or ending on such day.
PART III
SERVICER'S FEE RESERVE
A. SERVICER'S FEE RESERVE. The "SERVICER'S FEE RESERVE" for the related
Undivided Interest at any time means an amount determined as follows:
SFR = SF + ROSF
WHERE:
SFR = the Servicer's Fee Reserve for such Undivided
Interest at any time;
SF = the unpaid Servicer's Fee relating to such
Undivided Interest accrued to such time and
unpaid as determined pursuant to Part III B;
and
ROSF = the Run Off Servicer's Fee for such Undivided
interest at such time, as determined pursuant to
PART III.C.
B. SERVICER'S FEE. The "SERVICER'S FEE" relating to any
Undivided Interest accrued for any day means
(i) an amount equal to (x) .50% PER ANNUM, TIMES
(y) the amount of the related Purchaser's Investment at the
close of business on such day, TIMES (z) 1/360; or
(ii) on and after Servicer's reasonable request
made at any time when the Transferor shall no longer be
Servicer, an alternative amount specified by Servicer not
exceeding (x) 110% of Servicer's cost and expenses of
performing its obligations under the Agreement during the
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Yield Period when such day occurs, divided by (y) the number
of days in such Yield Period.
C. RUN OFF SERVICER'S FEE. The "RUN OFF SERVICER'S FEE" for
any Undivided Interest at any time means an amount equal to
(x) the related Purchaser's Investment at such
time, TIMES
(y) (A) the percentage PER ANNUM set forth in
clause (i) (x) of the definition of "Servicer's Fee", or (B)
if Servicer's Fee is calculated pursuant to CLAUSE (II) of
such definition, the percentage PER ANNUM determined for each
day by dividing the amount of the Servicer's Fee accrued for
such day by the related Purchaser's Investment at the close of
business on such day, multiplying the quotient by 360 and
expressing the product as a percentage, TIMES
(z) a fraction, the numerator of which is the
number of days equal to the then Adjusted Average Maturity,
and the denominator of which is 360 days.
PART IV
ADJUSTED AVERAGE MATURITY
"ADJUSTED AVERAGE MATURITY" means, on any day, the product of (i) 2
times (ii) the Average Maturity for such day.
"AVERAGE MATURITY" means, on any day, that time period (expressed in
days) equal to the weighted average maturity of the Pool Receivables as shall be
calculated by Servicer, as set forth in the most recent Periodic Report in
accordance with the provisions thereof. If a Managing Agent shall disagree with
any such calculation, such Agent may recalculate the Average Maturity for such
day, which calculation shall, absent manifest error, be binding upon Servicer,
the Transferor and Purchaser.
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APPENDIX C
DEFINITIONS TO FINANCIAL COVENANTS
(Cross references are to the Loan Agreement as defined herein).
"ASSESSMENT RATE" means, for any day, the annual assessment rate
(rounded upwards, if necessary, to the nearest 1/100 of 1%) which is payable by
the Agent (in its individual capacity) to the Federal Deposit Insurance
Corporation (or any successor) for deposit insurance for Dollar time deposits
with the Agent (in its individual capacity) at its Principal Office as
determined by the Agent. The CD Rate shall be adjusted automatically as of the
effective date of each change in the Assessment Rate.
"ASSET SECURITIZATION FACILITY" means the asset backed commercial paper
funded receivables securitization facility among The Wackenhut Corporation as
Seller, NationsBank as Agent and as Administrative Agent, providing for the sale
by The Wackenhut Corporation and certain of its Subsidiaries of fractional
undivided interests in trade receivables, provided that at no time shall the
aggregate face amount of outstanding trade receivables of The Wackenhut
Corporation and its Subsidiaries sold or otherwise transferred (in whole or in
part) through such program exceed $75,000,000.
"CD RATE" means, for any CD Rate Loan, the rate of interest per annum
determined pursuant to the following formula:
"CD RATE LOAN" means all of the Loans for which the rate of interest is
determined by reference to the CD Rate.
CD = Applicable CD Rate + Assessment + Applicable
Rate 1 - Applicable Reserve Requirement Rate Margin
"CONSOLIDATED NET INCOME" for any period means the gross revenues of
The Wackenhut Corporation and its Subsidiaries for such period less all expenses
and other proper charges (including taxes on income and Interest Charges),
determined on a consolidated basis after eliminating earnings or losses
attributable to outstanding Minority Interests, but excluding in any event:
(a) any gains on the sale or other disposition of Investments
or fixed or capital assets, and any taxes on such excluded gains and
any tax deductions or credits on account of any such excluded losses;
(b) the proceeds of any life insurance policy except for
proceeds received during such period with respect to deferred
compensation plans to the extent that The Wackenhut
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Corporation or any Subsidiary recognized any expenses during
such period with respect to such plans;
(c) net earnings and losses of any Subsidiary accrued prior to
the date it became a Subsidiary;
(d) net earnings and losses of any corporation (other than a
Subsidiary), substantially all the assets of which have been acquired
in any manner by The Wackenhut Corporation or any Subsidiary, realized
by such corporation prior to the date of such acquisition;
(e) net earnings and losses of any corporation (other than a
Subsidiary) with which The Wackenhut Corporation or a Subsidiary shall
have consolidated or which shall have merged into or with The Wackenhut
Corporation or a Subsidiary prior to the date of such consolidation or
merger;
(f) net earnings of any business entity (other than a
Subsidiary) in which The Wackenhut Corporation or any Subsidiary has an
ownership interest unless such net earnings shall have actually been
received by The Wackenhut Corporation or such Subsidiary in the form of
cash distributions;
(g) any portion of the net earnings of any Subsidiary which
for any reason is unavailable for payment of dividends to The Wackenhut
Corporation or any other Subsidiary;
(h) earnings resulting from any reappraisal, revaluation or
write-up of assets;
(i) any deferred or other credit representing any excess of
the equity in any Subsidiary at the date of acquisition thereof over
the amount invested in such Subsidiary;
(j) any gain arising from the acquisition of any Securities of
The Wackenhut Corporation or any Subsidiary; and
(k) any reversal of any contingency reserve, except to the
extent that provision for such contingency reserve shall have been made
from income arising during such period.
"CONSOLIDATED NET WORTH" means at any time as of which the amount
thereof is to be determined, the sum of the following with respect to The
Wackenhut Corporation and its Subsidiaries (on a consolidated basis and
excluding intercompany items): (i) the amount of issued and outstanding share
capital, plus (ii) the amount of additional paid-in capital and retained income
(or, in the case of a deficit, minus the amount of such deficit), minus (iii)
the sum of the following (without duplication of deductions in respect of items
already deducted in arriving at surplus and retained earnings): (A) all
reserves, except legal reserves and
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other contingency reserves (i.e., reserves not allocated to specific purposes
and not deducted from assets), which are properly treated as appropriations of
surplus or retained earnings; (B) any treasury stock, capital stock subscribed
and unissued and other contra-equity accounts; and (C) the cumulative amount of
any net write-up of asset values after the date of the audit immediately
preceding the Closing Date, plus or minus, as the case may be (iv) the
cumulative effect of foreign exchange valuations.
"DOLLARS" and the symbol "$" means dollars constituting legal tender
for the payment of public and private debts in the United States of America.
"EURODOLLAR RATE" means the interest rate per annum calculated
according to the following formula:
Eurodollar Rate = INTERBANK OFFERED RATE + Applicable Margin
------------------------------
1 - Applicable Reserve Requirement
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to the Agent (in its
individual capacity) on such day on such transactions as determined by the
Agent.
"FIXED CHARGES" for any period means on a consolidated basis the sum of
(i) 100% of all Rentals (other than Rentals on Capitalized Leases) payable
during such period by The Wackenhut Corporation and its Subsidiaries (other
than WCC), and (ii) all Interest Charges on all Indebtedness (including the
interest component of Rentals on Capitalized Leases and the discount factor or
other economic equivalent of interest under the Asset Securitization Facility)
of The Wackenhut Corporation and its Subsidiaries (other than Wackenhut
Connections Corporation) payable during said period by The Wackenhut Corporation
and its Subsidiaries (other than WCC).
"FIXED CHARGES COVERAGE RATIO" means the ratio of Net Income
Available for Fixed Charges to Fixed Charges.
"GAAP" or "Generally Accepted Accounting Principles" means generally
accepted accounting principles, being those principles of accounting set forth
in pronouncements of the Financial Accounting
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Standards Board, the American Institute of Certified Public Accountants or which
have other substantial authoritative support and are applicable in the
circumstances as of the date of a report.
"GUARANTIES" by any Person means all obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect, guaranteeing
any Indebtedness, dividend or other obligation, of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, all obligations incurred through an agreement, contingent or
otherwise, by such Person: (i) to purchase such Indebtedness or obligation or
any property or assets constituting security therefor, (ii) to advance or supply
funds (x) for the purchase or payment of such Indebtedness or obligation, (y) to
maintain working capital or other balance sheet condition or otherwise to
advance or make available funds for the purchase or payment of such Indebtedness
or obligation, or (iii) to lease property or to purchase Securities or other
Property or services primarily for the purpose of assuring the owner of such
Indebtedness or obligation of the ability of the primary obligor to make
payment of the Indebtedness of obligation, or (iv) otherwise to assure the owner
of the Indebtedness or obligation of the primary obligor against loss in respect
thereof. For the purposes of all computations made under the Loan Agreement, a
Guaranty in respect of any Indebtedness for borrowed money shall be deemed to be
Indebtedness equal to the principal amount of such Indebtedness for borrowed
money which has been guaranteed, and a Guaranty in respect of any other
obligation or liability or any dividend shall be deemed to be Indebtedness equal
to the maximum aggregate amount of such obligation, liability or dividend.
"INDEBTEDNESS" of any Person means and include all obligations of such
Person which in accordance with GAAP shall be classified upon a balance sheet of
such Person as liabilities of such Person, and in any event shall include all
(i) obligations of such Person for borrowed money or which has been incurred in
connection with the acquisition of property or assets, (ii) obligations secured
by any Lien upon property or assets owned by such Person, even though such
Person has not assumed or become liable for the payment of such obligations,
(iii) obligations created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person,
notwithstanding the fact that the rights and remedies of the seller, lender or
lessor under such agreement in the event of default are limited to repossession
or sale of property, (iv) Capitalized Rentals under any Capitalized Lease, (v)
Guaranties of Indebtedness of others, (vi) the Reimbursement Obligations, and
(vii) outstanding amounts received by The Wackenhut Corporation or any
Subsidiary in exchange for the transfer of interests in trade receivables under
the Asset Securitization Facility in excess of the amounts repaid to the
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purchasers in respect of such purchase price from collections on such trade
receivables.
"INTEREST CHARGES" for any period means all interest and all
amortization of debt discount and expense on any particular Indebtedness for
which such calculations are being made, and shall include without limitation the
discount factor or other economic equivalent of interest arising under the Asset
Securitization Facility. Computations of Interest Charges on a pro forma basis
for Indebtedness having a variable interest rate shall be calculated at the
rate in effect on the date of any determination.
"INVESTMENTS" means all investments, in cash or by delivery of Property
made, directly or indirectly in any Person, whether by acquisition of shares of
capital stock, indebtedness or other obligations or Security or by loan,
advance, capital contribution or otherwise; provided, however, that
"Investments" shall not mean or include routine investments in Property to be
used or consumed in the ordinary course of business or investments in accounts
receivable or notes receivable arising in the ordinary course of business.
"LETTER OF CREDIT" or "LETTERS OF CREDIT" means a letter of credit
issued by the Issuing Bank for the account of The Wackenhut Corporation or The
Wackenhut Corporation and Titania in favor of a Person advancing credit,
providing insurance or securing obligations on behalf of The Wackenhut
Corporation or The Wackenhut Corporation and Titania, and shall include without
limitation all Existing LCS.
"LIEN" means any interest in Property securing an obligation owed to,
or a claim by, a Person other than the owner of the Property, whether such
interest is based on the common law, statute or contract, and including but not
limited to the security interest lien arising from a mortgage, encumbrance,
pledge, conditional sale or trust receipt or a lease, consignment or bailment
for security purposes. The term "Lien" shall include reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions, restrictions,
leases and other title exceptions and encumbrances (including, with respect to
stock, stockholder agreements, voting trust agreements, buy-back agreements and
all similar arrangements) affecting Property. For the purposes of the Loan
Agreement, The Wackenhut Corporation or a Subsidiary shall be deemed to be the
owner of any Property which it has acquired or holds subject to a conditional
sale agreement, Capitalized Lease or other arrangement pursuant to which title
to the Property has been retained by or vested in some other Person for security
purposes and such retention or vesting shall constitute a Lien.
"LOAN" or "LOANS" means any of the Fixed Rate Loans or Floating Rate
Loans, as the context may require.
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"LOAN AGREEMENT" means the Amended and Restated Revolving Credit
Reimbursement Agreement dated as of December 30, 1997 among the Wackenhut
Corporation, NationsBank, N.A., as Lender and as agent.
"MINORITY INTERESTS" means any shares of stock of any class of a
Subsidiary (other than directors' qualifying shares as required by law) that are
not owned by The Wackenhut Corporation and/or one or more of its Subsidiaries.
Minority Interests shall be valued by valuing Minority Interests constituting
preferred stock at the voluntary or involuntary liquidating value of such
preferred stock, whichever is greater, and by valuing Minority Interests
constituting common stock at the book value of capital and surplus applicable
thereto adjusted, if necessary, to reflect any changes from the book value of
such common stock required by the foregoing method of valuing Minority Interests
in preferred stock.
"NET INCOME AVAILABLE FOR FIXED CHARGES" for any period means the sum
of (i) Consolidated Net Income during such period (excluding, for the purpose
of determining Net Income Available for Fixed Charges, revenues, expenses and
other appropriate charges or adjustments attributable to WCC) plus (to the
extent deducted in determining Consolidated Net Income), (ii) all provisions for
any Federal, state or other income taxes made by The Wackenhut Corporation and
its Subsidiaries (other than WCC) during such period, and (iii) Fixed Charges of
The Wackenhut Corporation and its Subsidiaries (other than WCC) during such
period.
"PARTICIPATION" means, with respect to any Lender and either a Letter
of Credit or a Swing Line Loan, as the case may be, the extension of credit
represented by the participation of such Lender hereunder in the Issuing Bank's
liability in respect of a Letter of Credit issued by the Issuing Bank in
accordance with the terms hereof, or in NationsBank's liability in respect of a
Swing Line Loan made in accordance with the terms hereof.
"PRINCIPAL OFFICE" means the principal office of NationsBank, presently
located at Independence Center, 15th Floor, NC1-001-15- 04, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, Attention: Agency Services.
"RENTALS" means and include as of the date of any determination
thereof, all fixed payments (including as such all payments which the lessee is
obligated to make to the lessor on termination of the lease or surrender of the
Property) payable by The Wackenhut Corporation or a Subsidiary, as lessee or
sublessee under a lease of real or personal property, but shall be exclusive of
any amounts required to be paid by The Wackenhut Corporation or a Subsidiary
(whether or not designated as rents or additional rents) on account of
maintenance, repairs, insurance, taxes and similar charges. Fixed rents under
any so-called "percentage leases" shall be computed solely on the basis of the
minimum rents, if any, required
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to be paid by the lessee regardless of sales volume or gross revenues.
"SECURITY" shall have the same meaning as in Section 2(1) of the
Securities Act of 1933, as amended.
"SUBSIDIARY" means, as to any particular parent corporation, any
corporation of which more than 50% (by number of votes) of the Voting Stock
shall be owned by such parent corporation and/or one or more corporations which
are themselves subsidiaries of such parent corporation. The term "Subsidiary"
shall mean a subsidiary of The Wackenhut Corporation and The Atrium At Coral
Gables, Ltd., a Florida limited partnership.
"TITANIA" means Titania Insurance Company of America, a corporation
organized under the laws of Vermont and a wholly-owned Subsidiary of The
Wackenhut Corporation.
"TOTAL CAPITALIZATION" means the sum of (i) Consolidated Funded Debt
plus (ii) Consolidated Net Worth.
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Schedule 2.3(b)
FORM OF SPECIAL CONCENTRATION LIMIT CERTIFICATE
Reference is made to that certain Transfer and Administration
Agreement dated as of December 30, 1997(as at any time amended or otherwise
modified, the "Purchase Agreement") among Wackenhut Funding Corporation, a
Florida corporation, The Wackenhut Corporation, Enterprise Funding Corporation,
and NationsBank N.A. Capitalized terms used herein have the meaning assigned
thereto in the Purchase Agreement. For purposes of Section 2.3(b) of the
Purchase Agreement, the following Special Concentration Limits shall be in
effect for the period from December 30, 1997 until such time as the
Administrative Agent delivers to the Transferor and the Servicer written notice
of a change in the Special Concentration Limits:
1. OBLIGOR LIMITS:
(a) Any one Obligor rated BBB or Baa2 or better by
Standard & Poor's Corporation and Xxxxx'x Investors
Service, Inc., respectively, may have a Special
Concentration Limit of the Aggregate Unpaid Balance
of the Eligible Receivables in the Receivables Pool
at any time, PLUS
(b) Any three Obligors rated BBB or Baa2 or better by
Standard & Poor's Corporation and Xxxxx'x Investors
Service, Inc., respectively, may each have Special
Concentration Limits of 4% of the Aggregate Unpaid
Balance of the Eligible Receivables in the
Receivables Pool at any time, PLUS
(c) Any five Obligors, regardless of rating, may each
have Special Concentration Limits of 3% of the
Aggregate Unpaid Balance of the Eligible Receivable
in the Receivable Pool at any time.
Transferor shall identify the specific Obligors to whom the
Special Concentration Limits described in this Paragraph 1 should be applied by
such form of notice as the Agent may from time to time require.
2. OBLIGOR CATEGORY LIMITS:
(a) The aggregate Concentration Limit for all Obligors
with respect to Receivables originated by Wackenhut
Airline Services, Inc. shall be 10% of the Aggregate
Unpaid Balance of the Eligible Receivables in the
Receivables Pool at any time.
128
(b) The aggregate Concentration Limit for all Obligors
with respect to Receivables for which the related
service has not yet been rendered by the Seller or an
Originator shall be of the Aggregate Unpaid Balance
of the Eligible Receivables in the Receivables Pool
at any time.
(c) The aggregate Concentration Limit for all Government
Obligors shall be 15% of the Aggregate Unpaid Balance
of the Eligible Receivables in the Receivables Pool
at any time.
Date:____________________ NATIONSBANK, N.A.
By:
--------------------------------
Its:
-----------------------------
2
129
SCHEDULE 5.1(a)
FORM OF CERTIFICATE OF ASSIGNMENTS
Reference is made to the Transfer and Administration
Agreement, dated as of December 30, 1997 (the "TRANSFER AGREEMENT"), among the
undersigned (as "SELLER"), Enterprise Funding Corporation (as the "Purchaser" or
"Enterprise"), NationsBank, N.A., as agent for Enterprise and the Bank Investors
(in such capacity, the "Agent") and The Wackenhut Corporation (as "Servicer").
Terms defined in the Transfer Agreement are used herein as therein defined.
The undersigned hereby sells, assigns and transfers unto
Enterprise each Undivided Interest purchased from the undersigned in one or more
Purchases pursuant to the Transfer Agreement.
Each Purchase by Enterprise from the undersigned of an
Undivided Interest shall be endorsed by Enterprise on a grid with respect to
each such Undivided Interest which has been or shall be attached hereto (and,
upon such attachment, made a part hereof) or, at Enterprise's option, in the
records of the Administrative Agent, and such endorsement shall evidence the
ownership by Enterprise of the Undivided Interest; PROVIDED, that the failure
of Enterprise (or the Administrative Agent on behalf of Enterprise) to make any
such endorsement shall not void or otherwise impair any Purchase or limit the
undersigned's obligations under the Transfer Agreement with respect to the
Undivided Interests purchased.
This Certificate of Assignments is made without recourse
except as provided in the Transfer Agreement. This Certificate of Assignments is
made pursuant to and upon all the representations, warranties, covenants and
agreements on the part of the undersigned contained in the Transfer Agreement.
This Certificate of Assignments is governed by and is to be
construed and interpreted in accordance with the Transfer Agreement and the
internal laws of the State of New York without regard to principles of conflicts
of laws.
Assignment by Enterprise of one or more Undivided Interests,
or any portion thereof, is subject to the terms of the Transfer Agreement,
including, without limitation, ARTICLE XIII thereof. Any such assignment shall
be endorsed by Enterprise on the grid with respect to each such Undivided
Interest attached hereto or, at Enterprise's option, in the records of the
Agent, and such endorsement shall evidence the ownership by the assignee named
therein of each Undivided Interest (or portion thereof) so assigned; PROVIDED,
that the failure of Enterprise (or the Agent
130
on behalf of Enterprise) to make any such endorsement shall not void or
otherwise impair any such assignment or limit the undersigned's obligations
under the Agreement to the assignee with respect to any such Undivided Interest
(or portion thereof) so assigned.
Each reduction in Enterprise's Investment of each Undivided
Interest as a result of the occurrence of a Run Off Day or day of partial
liquidation as provided in SECTION 3.03(B) or (C) of the Transfer Agreement with
respect to such Undivided Interest and each combination or division of one or
more Undivided Interests shall also be endorsed by Enterprise on the grid with
respect to each such Undivided Interest and each combination or division of one
or more Undivided Interests attached hereto or, at Enterprise's option, in the
records of the Administrative Agent, but the failure of Enterprise (or the Agent
on behalf of Enterprise) to make any such endorsement shall not modify such
reduction in Enterprise's Investment or such combination or division of one or
more Undivided Interests.
The undersigned hereby certifies on and as of the date of each
Purchase that the conditions set forth in SECTIONS 5.02 AND 5.03 of the Transfer
Agreement are fulfilled on such date.
This letter agreement may be executed in counterparts each of
which shall be deemed to be an original and all of which together shall
constitute but one and the same letter agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment
to be duly executed this , 199 .
WACKENHUT FUNDING CORPORATION
By
----------------------------------------
Title
------------------------------------
2
131
Grid with Respect to Undivided Interest No. _____1
Attached to and Made a Part of Certificate of Assignments
dated ________ __, 199__ from Wackenhut Funding Corporation
to Enterprise Funding Corporation
Amount of Amount of
Amount of Reduction Increase of
Date of Enter- of Enter- Enter-
Endorsed prise's Amount of prise's prise's
Transaction Investment Assignment Investment Investment
----------- ---------- ---------- ---------- ----------
--------
1 A separate grid should be attached reflecting each Undivided Interest as sold.
3
132
December 30, 1997
NationsBank, N.A.
X.X. Xxx 000000
Xxxxxxx, XX 00000-0000
Ladies and Gentlemen:
Reference is made to our lock-box account No. 3750156489
maintained with you (the "ACCOUNT"). Pursuant to a Transfer and Administration
Agreement (the "TRANSFER AGREEMENT") dated as of December 30, 1997, as the same
may be amended or otherwise modified from time to time, among us, as Transferor,
The Wackenhut Corporation, as Servicer (the "SERVICER"), Enterprise Funding
Corporation, as a Purchaser ("PURCHASER") and NationsBank N.A., as a Bank
Investor and as the agent for the Purchaser and the Bank Investors (in such
capacity, the "AGENT"). We have assigned and/or may hereafter assign to the
Agent, on behalf of the Purchaser and the Bank Investors, one or more undivided
percentage interests in certain of the accounts, chattel paper, instruments or
general intangibles (collectively, "RECEIVABLES") with respect to which payments
are or may hereafter be made to the Account, and have granted to the Agent, on
behalf of the Purchaser and the Bank Investors, a security interest in the
undersigned's retained interest in such Receivables. Your execution of this
letter agreement is a condition precedent to the continued maintenance by us of
the Account with you.
In accordance with the Transfer Agreement, we are hereby
transferring to the Agent exclusive ownership and control of the Account, and we
hereby transfer exclusive ownership and control of the Account to the Agent. The
Agent has agreed to permit us to access the Account until such time as the Agent
gives you notice that we shall no longer be permitted access to such Account,
which notice shall be substantially in the form attached hereto as Annex A.
133
December 30, 1997
Page 2
We hereby irrevocably instruct you, at all times from and
after the date of your receipt of notice from the Agent as described above, to
make all payments to be made by you out of or in connection with the Account
directly to the Agent, at its address set forth below its signature hereto or as
the Agent 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 notice from the Agent as described above, the Agent
shall be irrevocably entitled to exercise in our place and stead any and all
rights in respect of or in connection with the Account, including, without
limitations, (a) the right to specify when payments are to be made out of or in
connection with the Account and (b) the right to require preparation of
duplicate monthly bank statements on the Account for the Agent's audit purposes
and mailing of such statements directly to an address specified by the Agent.
Notice from the Agent may be personally served or sent to
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
of agreement, or to such other address, Telex or facsimile number which you
provide the Agent in writing. If notice is given by Telex or facsimile, it will
be deemed to have been received when the 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 of agreement, you acknowledge the
Agent's ownership and control of the Account and its ownership of (in each
case, on behalf of the Purchaser and the Bank Investors) and security interest
in the amounts from time to time on deposit therein and agree that from the date
hereof the Account 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 Account is to be entitled "NationsBank, N.A." as the Agent
for Enterprise Funding Corporation and the Bank Investors". Except as otherwise
pro-
134
December 30, 1997
Page 3
vided in this letter agreement, payments to the Account are to be processed
in accordance with the standard procedures currently in effect. All service
charges and fees with respect to the Account shall continue to be payable by us
under the arrangements currently in effect.
By executing this letter agreement, you irrevocably waive and
agree not to assert, claim or endeavor to exercise, irrevocably bar and estop
yourself from asserting, claiming or exercising, and acknowledge that you have
not heretofore received a notice, writ, order or any form of legal process from
any other party asserting, claiming or exercising, any right of set-off,
banker's lien or other purported form of claim with respect to the Account or
any funds from time to time therein. Except for your right to payment of your
customary service charges and fees for the routine maintenance and operation of
the Account and to make deductions for returned items, you shall have no rights
in the Account or funds therein. To the extent you may ever have such rights,
you hereby expressly subordinate all such rights to all rights of the Agent.
You may terminate this letter agreement by canceling the
Account maintained with you, which cancellation and termination shall become
effective only upon thirty days' prior written notice thereof from you to the
Agent. Incoming mail addressed to the Account 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 Transfer Agreement pursuant to which this letter agreement was
obtained is no longer in effect. Except as otherwise provided in this paragraph,
this letter agreement may not be terminated or amended without the prior written
consent of the Agent.
Please acknowledge your agreement to the terms set forth in
this letter agreement by signing the two copies of this letter agreement
enclosed herewith in the space provided below, sending one such signed copy to
the Agent at its address provided above and returning the other signed copy to
us.
135
December 30, 1997
Page 4
Very truly yours,
WACKENHUT FUNDING CORPORATION
By: , Xxxxx X. Mayotte
Title:
Accepted and confirmed as of
the date first written above:
ENTERPRISE FUNDING CORPORATION
Purchaser
By:
Title:
Acknowledged and agreed to as of
the date first written above:
NATIONSBANK, N.A.
By:
Title:
Address for notice:
000 Xxxxxxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
XX0-000-00-00
Xxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Facsimile No.: 305/533-2463
136
ANNEX 1
TO LOCK-BOX AGREEMENT
NOTICE OF EFFECTIVENESS
DATED: ______________, 199_
TO: NationsBank, N.A.
X.X. Xxx 000000
Xxxxxxx, XX 00000-0000
ATTN: ______________________
Re: Lock-Box Account No. 3750156489
Ladies and Gentlemen:
We hereby give you notice that the transfer of control of the
above-referenced Lock-Box Account, as described in our letter agreement with you
dated as of December 23, 1997 is effective as of the date hereof. You are hereby
instructed to comply immediately with the instructions set forth in that letter.
Very truly yours,
WACKENHUT FUNDING CORPORATION
By:
--------------------------------
Title:
-----------------------------
ACKNOWLEDGED AND AGREED:
NATIONSBANK, N.A.
By:
--------------------------
Title:
-----------------------
Date:
------------------------
X.X. Xxx 000000
Xxxxxxx, XX 00000-0000
Attention:
-------------------
Facsimile No.:
----------------
137
EXHIBIT 13.5(B)
Form of Assignment and Assumption Agreement
Reference is made to the Transfer and Administration Agreement
dated as of December 30, 1997 as it may be amended or otherwise modified from
time to time (as so amended or modified, the "Transfer Agreement") among
Wackenhut Funding Corporation, as transferor (in such capacity, the
"Transferor"), The Wackenhut Corporation, individually and as servicer (in such
capacity, the "Servicer"), Enterprise Funding Corporation, as purchaser (in such
capacity, the "Purchaser") and NationsBank, N.A., as agent for Enterprise and
certain financial institutions from time to time a party thereto as Bank
Investors(in such capacity, the "Agent"). Terms defined in the Transfer
Agreement are used herein with the same meaning.
___________________ (the "Assignor") and _____________________
(the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
without recourse and without representation and warranty, and the Assignee
hereby purchases and assumes from the Assignor, an interest in and to all of
the Assignor's rights and obligations under the Transfer Agreement and the other
Agreement Documents. Such interest expressed as a percentage of all rights and
obligations of the Bank Investors being equal to the percentage equivalent of a
fraction the numerator of which is $________ and the denominator of which is the
Facility Limit. After giving effect to such sale and assignment, the Assignee's
Commitment will be as set forth on the signature page hereto.
i. [In consideration of the payment of $___________, being
___% of the existing Aqggregate Purchaser's Investment, and of $___________,
being ___% of the aggregate unpaid accrued Earned Discount, receipt of which
payment is hereby acknowledged, the Assignor hereby assigns to the Agent for the
account of the Assignee, and the Assignee hereby purchases from the Assignor, a
___% interest in and to all of the Assignor's right, title and interest in and
to the Aggregate Purchaser's Investment purchased by the undersigned on
_______________, 19__ under the Transfer Agreement.][include if an existing
Aggregate Purchaser's Investment is being assigned.]
ii. The Assignor (i) represents and warrants that it
is the legal and beneficial owner of the interest being assigned
by it hereunder and that such interest is free and clear of any
138
adverse claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Transfer Agreement, any other Agreement
Document or any other instrument or document furnished pursuant thereto or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Transfer Agreement or the Receivables, any other Agreement Document or
any other instrument or document furnished pursuant thereto; and (iii) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any of the Transferor, the Servicer,the SELLER or any
Originator or the performance or observance by any of the Transferor, the
Servicer, the SELLER or any Originator of any of its obligations under the
Transfer Agreement, any other Agreement Document, or any instrument or document
furnished pursuant thereto.
iii. The Assignee (i) confirms that it has received a copy of
the Transfer Agreement, the Receivables Purchase Agreement and the Amended and
Restated Purchase and Sale Agreement, together with copies of the financial
statements referred to in Section 6.2 of the Transfer Agreement, to the extent
delivered through the date of this Agreement, and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment; (ii) agrees that it will, independently
and without reliance upon the Agent, any of its Affiliates, the Assignor or any
other Purchaser and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Transfer Agreement and any other Agreement Document;
(iii) appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Transfer Agreement
and the other Agreement Documents as are delegated to the Agent by the terms
thereof, together with such powers and discretion as are reasonably incidental
thereto; (iv) agrees that it will perform in accordance with their terms all of
the obligations which by the terms of the Transfer Agreement are required to be
performed by it as a Bank Investor; and (vi) specifies as its address for
notices and its account for payments the office and account set forth beneath
its name on the signature pages hereof[; and (vii) attaches the forms prescribed
by the Internal Revenue Service of the United States of America certifying as to
the Assignee's status for purposes of determining exemption from United States
withholding taxes with respect to all payments to be made to the Assignee under
the Transfer Agreement or such other documents as
2
139
are necessary to indicate that all such payments are subject to such rates at a
rate reduced by an applicable tax treaty].2
iv. The effective date for this Assignment shall be the later
of (i) the date on which the Agent receives this Assignment executed by the the
parties hereto and receives the consent of the Transferor and the Agent, on
behalf of the Purchaser, and (ii) the date of this Assignment (the "Effective
Date"). Following the execution of this Assignment and Assumption Agreement and
the consent of the Transferor and the Agent, on behalf of the Purchaser, this
Assignment and Assumption Agreement will be delivered to the Agent for
acceptance and, with respect to the Assignment and Assumption Agreement,
recording by the Agent.
v. Upon such acceptance and recording, as of the Effective
Date, (i) the Assignee shall be a party to the Transfer Agreement and, to the
extent provided in this Assignment, have the rights and obligations of a Bank
Investor thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment, relinquish its rights and be released from its obligations under the
Transfer Agreement.
(vi.) Upon such acceptance and recording, from and after the
Effective Date, the Agent shall make all payments under the Transfer Agreement
in respect of the interest assigned hereby (including, without limitation, all
payments in respect of such interest in Aggregate Purchaser's Investment, Earned
Discount and fees) to the Assignee. The Assignor and Assignee shall make all
appropriate adjustments in payments under the Transfer Agreement for periods
prior to the Effective Date directly between them selves.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
--------
2 If the Assignee is organized under the laws of a jurisdiction outside
the United States.
3
140
(vii.) This Assignment shall be governed by, and
construed in accordance with, the laws of the State of New York.
(i) This Assignment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of the signature page to this Assignment by telecopier shall be
effective as delivery of a manually executed counterpart of this Assignment.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Assumption to be executed by their respective officers thereunto
duly authorized as of the ____ day of ______, 19__.
Remaining [NAME OF ASSIGNOR]
COMMITMENT
By:
------------------------
Name:
Title:
COMMITMENT [NAME OF ASSIGNEE]
$-----------
By:
------------------------
Name:
Title:
Address for notices and
Account for payments:
[Address]
[Account]
4
141
Consented to this __ day
of _________, 199_
NATIONSBANK, N.A., as
Administrative Agent
By:
--------------------------
Name:
Title:
[TRANSFEROR]
By:
--------------------------
Name:
Title:
Accepted this ____ day
of _________, 199_
NATIONSBANK, N.A.
as Agent
By:
--------------------------
Name:
Title:
5
142
Schedule 6.1(n)
List of Location of Records
0000 Xxxxxxxxx Xxxxx #000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
143
Schedule 6.2(n)
List of Location of Records
0000 Xxxxxxxxx Xxxxx #000
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
144
Schedule 6.2(o)
List of Lockbox Banks and Accounts
BANK NAME ABA ACCOUNT NUMBER
--------- --- --------------
NationsBank Customer Connection 111000012 3750156489
