RECEIVABLES SALE AGREEMENT
dated as of March 31, 2000
among
Big Sky Coal Company, Caballo Coal Company, Eastern Associated Coal Corp.,
Peabody COALSALES Company, Peabody Coal Company, Peabody Western Coal Company,
Powder River Coal Company, Seneca Coal Company, Pine Ridge Coal Company and EACH
OF THEIR AFFILIATES WHO HEREAFTER BECOMES A ORIGINATOR HEREUNDER,
as Originators,
and
P&L COAL HOLDINGS CORPORATION,
as Purchaser
TABLE OF CONTENTS
Page
ARTICLE I. AMOUNTS AND TERMS OF THE PURCHASES__________________________________1
Section 1.1 Purchases of Receivables.____________________________________1
Section 1.2 Payment for the Purchases.___________________________________2
Section 1.3 Purchase Price Credit Adjustments.___________________________3
Section 1.4 Payments and Computations, Etc.______________________________4
Section 1.5 Transfer of Records._________________________________________4
Section 1.6 Characterization; Granting Clause.___________________________4
ARTICLE II. REPRESENTATIONS AND WARRANTIES_____________________________________5
Section 2.1 Representations of the Originators.__________________________5
ARTICLE III. CONDITIONS OF PURCHASES___________________________________________8
Section 3.1 Conditions Precedent to Initial Purchase.____________________8
Section 3.2 Conditions Precedent to All Purchases.______________________10
Section 3.3 Reaffirmation of Representations and Warranties.____________10
ARTICLE IV. COVENANTS_________________________________________________________10
Section 4.1 Affirmative Covenants.______________________________________10
Section 4.2 Negative Covenants._________________________________________13
ARTICLE V. JOINDER OF ADDITIONAL ORIGINATORS__________________________________15
Section 5.1 Addition of New Originators.________________________________15
Section 5.2 Documentation.______________________________________________15
ARTICLE VI. ADDITIONAL RIGHTS AND OBLIGATIONS IN
RESPECT OF THE RECEIVABLES____________________________________________________16
Section 6.1 Rights of P&L.______________________________________________16
Section 6.2 Responsibilities of the Originators.________________________16
Section 6.3 Further Action Evidencing Purchases.________________________16
Section 6.4 Application of Collections._________________________________17
ARTICLE VII. INDEMNIFICATION__________________________________________________17
Section 7.1 Indemnities by the Originators._____________________________17
Section 7.2 Costs, Expenses and Taxes.__________________________________19
ARTICLE VIII. MISCELLANEOUS___________________________________________________20
Section 8.1 Waivers and Amendments._____________________________________20
Section 8.2 Notices, Etc._______________________________________________20
Section 8.3 Cumulative Remedies.________________________________________20
Section 8.4 Binding Effect; Assignability.______________________________21
Section 8.5 Acknowledgment and Agreement._______________________________21
Section 8.6 Governing Law.______________________________________________21
Section 8.7 Submission to Jurisdiction._________________________________21
Section 8.8 Waiver of Jury Trial._______________________________________22
Section 8.9 Captions and Cross References; Incorporation
by Reference._______________________________________________22
Section 8.10 Execution in Counterparts.__________________________________22
RECEIVABLES SALE AGREEMENT
THIS RECEIVABLES SALE AGREEMENT (as amended, supplemented,
restated or otherwise modified from time to time, this "Agreement"), dated as of
March 31, 2000, is entered into by and among:
(1) Big Sky Coal Company, a Delaware corporation, Caballo
Coal Company, a Delaware corporation, Eastern Associated Coal
Corp., a West Virginia corporation, Peabody COALSALES Company, a
Delaware corporation, Peabody Coal Company, a Delaware
corporation, Peabody Western Coal Company, a Delaware
corporation, Powder River Coal Company, a Delaware corporation,
Seneca Coal Company, a Delaware corporation, and Pine Ridge Coal
Company, a Delaware corporation (collectively, the "Initial
Originators"), as sellers, and
(2) P&L Coal Holdings Corporation, a Delaware corporation
("P&L"), as purchaser.
Unless otherwise indicated, capitalized terms used in this Agreement are defined
in Exhibit A hereto or in the Receivables Purchase Agreement referenced therein.
W I T N E S S E T H :
WHEREAS, P&L owns, directly or indirectly, not less than 75% of
the issued and outstanding capital stock or membership interests of
each of the Originators; and
WHEREAS, the Originators desire to sell to P&L certain
Receivables and Related Security owned from time to time by the
Originators, and P&L is willing, on the terms and subject to the
conditions set forth herein, to purchase Receivables and Related
Security from the Originators.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1 Purchases of Receivables.
(a) Effective on the Applicable Closing Date for each Originator, in
consideration for the Purchase Price and upon the terms and subject to the
conditions set forth herein, each Originator does hereby sell, assign, transfer,
set-over and otherwise convey to P&L, without recourse (except to the extent
expressly provided herein), and P&L does hereby purchase from such Originator,
all of such Originator's right, title and interest in and to such Originator's
Initial Receivables and all Related Security with respect thereto.
(b) Effective on each Business Day after each Originator's Applicable
Closing Date and prior to its Sale Termination Date, in consideration for the
Purchase Price and upon the terms and subject to the conditions set forth
herein, such Originator does hereby sell, assign, transfer, set-over and
otherwise convey to P&L, without recourse (except to the extent expressly
provided herein), and P&L does hereby purchase from such Originator, all of such
Originator's right, title and interest in and to such Originator's Additional
Receivables and all Related Security with respect thereto.
(c) It is the intention of the parties hereto that each sale of Receivables
made hereunder shall constitute a "sale of accounts" (as such term is used in
Article 9 of the UCC), which sale is absolute and irrevocable and shall provide
P&L with the full benefits of ownership of the Receivables and the associated
Related Security. Except for the Purchase Price Credits owed pursuant to Section
1.3, each sale of Receivables hereunder is made without recourse to the
applicable Originator; provided, however, that (i) each Originator shall be
liable to P&L for all representations, warranties, covenants and indemnities
made by such Originator pursuant to the terms of the Transaction Documents to
which such Originator is a party, and (ii) such sale does not constitute and is
not intended to result in an assumption by P&L or any assignee thereof of any
obligation of such Originator or any other Person arising in connection with the
Receivables, the related Contracts or Invoices and/or other Related Security or
any other obligations of such Originator. In view of the intention of the
parties hereto that the acquisitions of Receivables made hereunder shall
constitute outright sales of such Receivables rather than loans secured thereby,
each Originator agrees that it will, on or prior to its Applicable Closing Date,
xxxx its master data processing records relating to its Receivables with the
legend required by Section 3.1(i) hereof. Upon the request of P&L or the Agent,
each Originator will 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 to perfect and maintain the
perfection of P&L's ownership interest in the Receivables and the Related
Security or as P&L or the Agent may reasonably request.
Section 1.2 Payment for the Purchases.
(a) The Purchase Price for each purchase of Initial Receivables and Related
Security from any Originator shall be payable in full by P&L to such Originator
on such Originator's Applicable Closing Date, and shall be paid to such
Originator (i) by delivery of immediately available funds, and/or (ii) by
delivery of the proceeds of a Subordinated Loan made by the applicable
Originator to P&L in a principal amount not to exceed the lesser of (A) the
remaining unpaid portion of such Purchase Price, and (B) 15% of such Purchase
Price.
(b) The Purchase Price for each purchase of Additional Receivables and
Related Security shall be due and owing in full by P&L to the applicable
Originator on the date of such purchase (except that P&L may, with respect to
any such purchase, offset against such (a) Purchase Price any amounts owed by
such Originator to P&L hereunder which have become due but remain unpaid) and
shall be paid to such Originator on the next subsequent Settlement Date by P&L
(i) by delivery of immediately available funds, and/or (ii) by delivery of the
proceeds of a Subordinated Loan made by the applicable Originator to P&L in a
principal amount not to exceed the lesser of (A) the remaining unpaid portion of
such Purchase Price, and (B) 15% of such Purchase Price.
(c) Subject to the limitations set forth in Section 1.2(a)(ii) and Section
1.2(b)(ii), each of the Originators irrevocably agrees to advance each
Subordinated Loan requested by P&L on or prior to such Originator's Sale
Termination Date. The Subordinated Loans owing to each Originator shall be
evidenced by, and shall be payable in accordance with the terms and provisions
of, its Subordinated Note. Each Originator is hereby authorized by P&L to
endorse on the schedule attached to its Subordinated Note an appropriate
notation evidencing the date and amount of each Subordinated Loan thereunder, as
well as the date of each payment with respect thereto, provided that the failure
to make such notation shall not affect any obligation of P&L thereunder.
Although the Purchase Price for each purchase of Additional Receivables and
Related Security shall be due and payable in full by P&L to the applicable
Originator on the date of such purchase, settlement of the Purchase Price
between P&L and such Originator shall be effected on Settlement Dates with
respect to all purchases within the prior calendar week. Although cash
settlements shall be effected on Settlement Dates, increases or decreases in the
Subordinated Loans shall be deemed to have occurred and shall be effective as of
the last Business Day of the calendar week to which such settlement relates.
Section 1.3 Purchase Price Credit Adjustments. (a) If on any day, any
Originator is deemed to have received a Deemed Collection with respect to any
Receivable sold by it to P&L hereunder, then, in such event, P&L shall be
entitled to a credit (each, a "Purchase Price Credit") against the Purchase
Price otherwise payable to such Originator hereunder in an amount equal to such
Deemed Collection. If such Purchase Price Credit exceeds the original
Outstanding Balance of the Receivables to be sold by the applicable Originator
on the date of a purchase, then the applicable Originator shall pay the
remaining amount of such Purchase Price Credit in cash not later than the next
Settlement Date provided that if such Originator's Sale Termination Date has not
occurred, such Originator shall be allowed to deduct the remaining amount of
such Purchase Price Credit from any Indebtedness owed to it under its
Subordinated Note to the extent permitted thereunder.
(b) If on any day, any Originator is advised that the Outstanding Balance
of an existing Receivable has been subject to an increase as a result of a
quality adjustment pursuant to the terms of the related Contract, such
Originator shall be entitled to an increase (each, a "Purchase Price Increase")
to the Purchase Price otherwise payable by P&L for such Receivable hereunder in
an amount calculated by reference to the definition of "Purchase Price" based
upon such increase in Outstanding Balance and the Discount Factor originally
applicable to such Receivable. P&L shall pay the applicable Originator each of
its Purchase Price Increases not later than the next Settlement Date in cash or
by increasing the balance outstanding under its Subordinated Note (subject to
the limitations set forth in Section 1.2(a)(ii) or Section 1.2(b)(ii), as
applicable).
Section 1.4 Payments and Computations, Etc. All amounts to be paid or
deposited by P&L hereunder shall be paid or deposited in accordance with the
terms hereof on the day when due in immediately available funds to the account
of the applicable Originator designated from time to time by such Originator or
as otherwise directed by such Originator. In the event that any payment owed by
any Person hereunder becomes due on a day that is not a Business Day, then such
payment shall be made on the next succeeding Business Day. If any Person fails
to pay any amount hereunder when due, such Person agrees to pay, on demand,
interest on the past due amount at the Default Rate until paid in full;
provided, however, that such interest shall not at any time exceed the maximum
rate permitted by applicable law.
Section 1.5 Transfer of Records.
(a) In connection with the sales of Receivables hereunder, each Originator
hereby sells, transfers, assigns and otherwise conveys to P&L all of such
Originator's right and title to and interest in the Records relating to all
Receivables sold by such Originator hereunder, without the need for any further
documentation in connection with any sale. In connection with such transfer,
each Originator hereby grants to each of P&L (and SPV and the Agent, as
assignees of P&L) and the Servicer an irrevocable, non-exclusive license to use,
without royalty or payment of any kind, all software used by such Originator to
account for its Receivables, to the extent necessary to administer such
Receivables, whether such software is owned by such Originator or is owned by
others and used by such Originator under license agreements with respect
thereto, provided that should the consent of any licensor of such Originator to
such grant of the license described herein be required, such Originator hereby
agrees that upon the request of P&L (or SPV or the Agent, as assignees of P&L)
or the Servicer, such Originator will use its reasonable efforts to obtain the
consent of such third-party licensor. The license granted hereby shall be
irrevocable, and shall terminate on the date on which all Aggregate Unpaids
under the Receivables Purchase Agreement have been paid in full.
(b) Each Originator (i) shall take such action requested by P&L (or SPV or
the Agent, as assignees of P&L) from time to time hereafter, that may be
necessary or reasonably appropriate to ensure that P&L has an enforceable
ownership interest in the Records relating to the Receivables sold by such
Originator to P&L hereunder, and (ii) shall use its reasonable efforts to ensure
that P&L and the Servicer each has an enforceable right (whether by license or
sublicense or otherwise) to use all of the computer software used to account for
such Receivables and/or to recreate such Records.
Section 1.6 Characterization; Granting Clause. If, notwithstanding the
intention of the parties expressed in Section 1.1(c), any sale to P&L of
Receivables hereunder shall be characterized as a secured loan and not as a
sale, then this Agreement shall be deemed to constitute a security agreement
under the UCC and other applicable law. For this purpose and without being in
derogation of the parties' intention that each sale of Receivables hereunder
shall constitute a true sale thereof, each of the Originators hereby grants to
P&L a duly perfected security interest in all of such Originator's right, title
and interest in, to and under all of such Originator's Receivables now existing
and hereafter arising, and in all Related Security with respect thereto, which
security interest shall be prior to all other Adverse Claims thereto. From and
after an Originator's Sale Termination Date but only so long as such Originator
shall be in material default of its covenants and agreements herein, P&L and its
assigns shall have as against such Originator, in addition to the rights and
remedies which they may have under this Agreement, all other rights and remedies
provided to a secured creditor after default under the UCC and other applicable
law, which rights and remedies shall be cumulative.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations of the Originators. In order to induce P&L to
enter into this Agreement and to make purchases hereunder, each Originator
hereby makes the following representations and warranties, as to itself, as of
the date of each sale by it hereunder:
(a) Existence and Power. Such Originator is a corporation or limited
liability company, duly organized, validly existing and in good standing under
the laws of its state of organization. Such Originator is duly qualified to do
business and is in good standing as a foreign corporation or limited liability
company, as the case may be, and has and holds all organizational power and all
governmental licenses, authorizations, consents and approvals required to carry
on its business in each jurisdiction in which its business is conducted except
where the failure to so qualify or so hold could not reasonably be expected to
have a Material Adverse Effect.
(b) Power and Authority; Due Authorization, Execution and Delivery. The
execution and delivery by such Originator of this Agreement (or a Joinder
Agreement) and each other Transaction Document to which it is a party, and the
performance of its obligations hereunder and thereunder, and such Originator's
use of the proceeds of purchases made hereunder, are within its corporate or
limited liability company, as applicable, powers and authority and have been
duly authorized by all necessary corporate or limited liability company, as
applicable, action on its part. This Agreement (or a Joinder Agreement) and each
other Transaction Document to which such Originator is a party has been duly
executed and delivered by such Originator.
(c) No Conflict. The execution and delivery by such Originator of this
Agreement (or a Joinder Agreement) and each other Transaction Document to which
it is a party, and the performance of its obligations hereunder and thereunder
do not contravene or violate (i) its Organic Documents, (ii) any law, rule or
regulation applicable to it, (iii) any restrictions under (a) any agreement,
contract or instrument to which it is a party or by which it or any of its
property is bound, or (iv) any order, writ, judgment, award, injunction or
decree binding on or affecting it or its property, and do not result in the
creation or imposition of any Adverse Claim on assets of such Originator or its
Subsidiaries (other than (A) as created under the Transaction Documents and (B)
the pledge of the Subordinated Notes pursuant to the Credit Agreement and
associated documents) except, in any case, where such contravention or violation
could not reasonably be expected to have a Material Adverse Effect, and no
transaction contemplated hereby requires compliance with any bulk sales act or
similar law.
(d) Governmental Authorization. Other than the filing of the financing
statements required hereunder, no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution and delivery by such Originator of this
Agreement (or a Joinder Agreement) and each other Transaction Document to which
it is a party and the performance of its obligations hereunder and thereunder.
(e) Actions, Suits. Except as disclosed in P&L's reports on SEC Form 10-K
or 10-Q, there are no actions, suits or proceedings pending, or to the best of
such Originator's knowledge, threatened, against or affecting such Originator,
or any of its properties, in or before any court, arbitrator or other body, that
could reasonably be expected to have a Material Adverse Effect. Such Originator
is not in default with respect to any order of any court, arbitrator or
governmental body.
(f) Binding Effect. This Agreement and each other Transaction Document to
which such Originator is a party constitute the legal, valid and binding
obligations of such Originator enforceable against such Originator in accordance
with their respective terms, except as such enforcement may be limited by
applicable bankruptcy, insolvency, reorganization or other similar laws relating
to or limiting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).
(g) Accuracy of Information. All information heretofore furnished by such
Originator to P&L (or its assigns) for purposes of or in connection with this
Agreement, any of the other Transaction Documents or any transaction
contemplated hereby or thereby is, and all such information hereafter furnished
by such Originator to P&L (or its assigns) will be, true and accurate in every
material respect on the date such information is stated or certified and does
not and will not contain any material misstatement of fact or omit to state a
material fact or any fact necessary to make the statements contained therein not
misleading.
(h) Use of Proceeds. No proceeds of any purchase hereunder will be used (i)
for a purpose that violates, or would be inconsistent with, Regulation T, U or X
promulgated by the Board of Governors of the Federal Reserve System from time to
time or (ii) to acquire any security in any transaction which is subject to
Section 12, 13 or 14 of the Securities Exchange Act of 1934, as amended.
(i) Good Title. Immediately prior to each purchase hereunder, such
Originator shall be the legal and beneficial owner of the Receivables and
Related Security with respect thereto, free and clear of any Adverse Claim,
except as created by the Transaction Documents.
(j) Perfection. This Agreement, together with the filing of the financing
statements contemplated hereby, is effective to, and shall, upon each purchase
hereunder, transfer to P&L (and P&L shall acquire from such Originator) a valid
and perfected first priority ownership interest in each Receivable originated by
such Originator, whether now existing or hereafter arising, and in the Related
Security and Collections with respect thereto, free and clear of any Adverse
Claim except as created by the Transactions Documents. There have been delivered
to the Agent (as assignee of P&L) in form suitable for filing all financing
statements or other similar instruments or documents necessary under the UCC (or
any comparable law) of all appropriate jurisdictions to perfect P&L's ownership
interest in each Receivable, its Collections and the Related Security.
(k) Places of Business and Locations of Records. The principal places of
business and chief executive office of such Originator and the offices where it
keeps all of its Records are located at the address(es) listed on Exhibit D or
such other locations of which P&L has been notified in accordance with Section
4.2(a) in jurisdictions where all action required by such Section 4.2(a) has
been taken and completed. Such Originator's Federal Employer Identification
Number is correctly set forth on Exhibit D.
(l) Collections. The conditions and requirements set forth in Section
4.1(i) have at all times since the Effective Date been satisfied and duly
performed.
(m) Material Adverse Effect. Since December 31, 1999, no event has occurred
that would have a material adverse effect on (i) the ability of such Originator
to perform its obligations under this Agreement, or (ii) the collectibility of
the Receivables originated by such Originator generally or any material portion
of such Receivables.
(n) Names. In the past five (5) years, such Originator has not used any
corporate or limited liability company names, trade names or assumed names other
than the name in which it has executed this Agreement and other than "Peabody
Group."
(o) Ownership of Originators. P&L owns, directly or indirectly, not less
than 75% of the issued and outstanding shares of stock or membership interests
of such Originator. Such shares or membership interests are validly issued,
fully paid and nonassessable, and there are no options, warrants or other rights
to acquire securities of such Originator.
(p) Not a Holding Company or an Investment Company. Such Originator is not
a "holding company" or a "subsidiary holding company" of a "holding company"
within the meaning of the Public Utility Holding Company Act of 1935, as
amended, or any successor statute. Such Originator is not an "investment
company" within the meaning of the Investment Company Act of 1940, as amended,
or any successor statute.
(q) Compliance with Law. Such Originator has complied in all respects with
all applicable laws, rules, regulations, orders, writs, judgments, injunctions,
decrees or awards to which it may be subject, except where the failure to so
comply could not reasonably be expected to have a Material Adverse Effect. Such
Originator represents and warrants that each Receivable originated by it,
together with the Contract and Invoice related thereto, does not contravene any
laws, rules or regulations applicable thereto (including, without limitation,
laws, rules and regulations relating to truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt collection practices
and privacy), and no part of such Contract or Invoice is in violation of any
such law, rule or regulation, except where such contravention or violation could
not reasonably be expected to have a Material Adverse Effect.
(r) Compliance with Credit and Collection Policy. From and after the
Effective Date, such Originator has complied in all material respects with the
Credit and Collection Policy with regard to each Receivable originated by it and
the related Invoice.
(s) Accounting. The manner in which such Originator accounts for the
transactions contemplated by this Agreement does not jeopardize the true sale
analysis.
(t) Enforceability of Invoices. Each Invoice with respect to each
Receivable originated by such Originator is effective to create, and has
created, a legal, valid and binding obligation of the related Obligor to pay the
Outstanding Balance of the Receivable created thereunder (subject to adjustment,
to the extent provided therein) and any accrued interest thereon, enforceable
against the Obligor in accordance with its terms, except as such enforcement may
be limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(u) Accounts. Each Receivable originated by such Originator is an "account"
under and as defined in the UCC of all applicable jurisdictions.
ARTICLE II.
CONDITIONS OF PURCHASES
Section 3.1 Conditions Precedent to Initial Purchase. The initial purchase
from each Originator hereunder is subject to the conditions precedent that (1)
P&L shall have executed and delivered a Subordinated Note in favor of such
Originator, and (2) P&L shall have received, on or before such Originator's
Applicable Closing Date, the following, each (unless otherwise indicated) dated
such Originator's Applicable Closing Date, and each in form, substance and date
reasonably satisfactory to P&L and the Agent (as assignee of P&L):
(a) A copy of the resolutions of such Originator's board of directors,
board of managers, general partners or analogous Persons of such Originator
approving the Transaction (a) Documents to be delivered by it and the
transactions contemplated hereby and thereby, certified by such Originator's
secretary, assistant secretary or analogous responsible officer;
(b) A good standing certificate for such Originator issued as of a recent
date by the Secretary of State of the state of its formation;
(c) A certificate of such Originator's secretary, assistant secretary or
analogous responsible officer certifying the names and true signatures of the
officers, partners, managers or members authorized on such Originator's behalf
to sign the Transaction Documents to be delivered by it, on which certificate
P&L and its assigns may conclusively rely until such time as they shall receive
from such Originator a revised certificate meeting the requirements of this
subsection (c);
(d) Recently certified copies of such Originator's Organic Documents;
(e) Copies of the proper financing statements (Form UCC-1) that have been
duly executed by such Originator, naming such Originator as the debtor or
seller, P&L as the purchaser or secured party, and SPV as assignee of P&L, in
each case, describing in reasonable detail the Receivables and the Related
Security to be sold by such Originator to P&L pursuant to this Agreement or
other similar instruments or documents, as may be necessary under the UCC of all
appropriate jurisdictions or any comparable law of all appropriate jurisdictions
to perfect P&L's ownership interest in such Receivables and Related Security,
together with financing statement assignments (Form UCC-3) naming the Agent as
the ultimate assignee thereof;
(f) A written search report from a Person satisfactory to P&L and its
assigns listing all effective financing statements that name such Originator as
debtor, seller or assignor and that are filed in the jurisdictions in which
filings were made pursuant to the foregoing subsection (e), together with copies
of such financing statements (none of which, except for those described in the
foregoing subsection (e) shall cover any Receivable or any Related Security)
which are to be sold by such Originator to P&L hereunder, and tax and judgment
lien search reports from a Person satisfactory to P&L and its assigns showing no
evidence of such liens filed against such personal property;
(g) Evidence (i) of the execution and delivery by each of the parties
thereto of each of the other Transaction Documents to be executed and delivered
in connection herewith and (ii) that each of the conditions precedent to the
execution, delivery and effectiveness of such other Transaction Documents has
been satisfied to P&L's and its assigns' mutual satisfaction;
(h) Opinions of such Originator's counsel satisfactory to P&L and its
assigns; and
(i) A certificate from an officer of such Originator to the effect that
such Originator has placed on its most recent, and have taken all steps
reasonably necessary to ensure that there shall be placed on subsequent, master
ledger the following legend:
"THE RECEIVABLES DESCRIBED HEREIN, TOGETHER WITH CERTAIN
RELATED SECURITY, HAVE BEEN SOLD, ARE NO LONGER OWNED BY THIS
SUBSIDIARY OR ITS PARENT, AND ARE SUBJECT TO A SECURITY
INTEREST IN FAVOR OF BANK ONE, NA, AS AGENT, FOR VARIOUS
PURCHASERS"
Section 3.2 Conditions Precedent to All Purchases. Each purchase shall be
subject to the further conditions precedent that:
(a) such Originator's Sale Termination Date shall not have occurred;
(b) P&L (or its assigns) shall have received such other approvals, opinions
or documents as it may reasonably request; and
(c) on the date of such purchase, each of the representations and
warranties of such Originator set forth in Article II hereof are true and
correct on and as of the date of such purchase (and after giving effect thereto)
as though made on and as of such date.
Section 3.3 Reaffirmation of Representations and Warranties. Each
Originator, by accepting the Purchase Price related to each purchase of such
Originator's Receivables and Related Security, shall be deemed to have certified
that the representations and warranties of such Originator contained in Article
II are true and correct as to such Originator on and as of the date of such
purchase, with the same effect as though made on and as of such day, and that
each of the applicable conditions precedent set forth in this Article III has
been satisfied as of the date of such purchase.
ARTICLE IV.
COVENANTS
Section 4.1 Affirmative Covenants. From each Originator's Applicable
Closing Date until the earlier to occur of such Originator's Sale Termination
Date or the date on which this Agreement terminates in accordance with its
terms:
(a) Reporting. From time to time upon request of P&L, such Originator will
provide P&L with such information as P&L may request in order to enable it to
complete each Monthly Report required to be delivered by it under the
Receivables Contribution Agreement.
(b) Notices. Such Originator will notify P&L and its assigns in writing of
any of the following promptly upon learning of the occurrence thereof,
describing the same and, if applicable, the steps being taken with respect
thereto:
(i) Judgment and Proceedings. The entry of any judgment or decree
against such Originator or any of its Subsidiaries if the aggregate amount
of all judgments and decrees then outstanding against P&L and its
Subsidiaries (other than SPV) exceeds $25,000,000 after deducting (A) the
amount with respect to which they are insured and with respect to which the
insurer has assumed responsibility in writing, and (B) the amount for which
they are otherwise indemnified if the terms of such indemnification are
satisfactory to P&L and its assigns.
(ii) Material Adverse Effect. The occurrence of any event or condition
that has had, or could reasonably be expected to have, a Material Adverse
Effect.
(iii) Defaults Under Other Agreements. The occurrence of a default or
an event of default under any other financing arrangement evidencing
$25,000,000 or more of indebtedness pursuant to which such Originator is a
debtor or an obligor, the effect of which is to cause, or to permit any
Person to cause, the acceleration of Indebtedness evidenced thereby.
(iv) Downgrade of such Originator. Any downgrade in the rating of any
Indebtedness of or guaranteed by such Originator by Standard & Poor's
Ratings Group or by Xxxxx'x Investors Service, Inc., setting forth the
Indebtedness affected and the nature of such change.
(c) Compliance with Laws and Preservation of Corporate Existence. Such
Originator will comply in all respects with all applicable laws, rules,
regulations, orders, writs, judgments, injunctions, decrees or awards to which
it may be subject, except where the failure to so comply could not reasonably be
expected to have a Material Adverse Effect. Such Originator will preserve and
maintain its corporate or limited liability company, as applicable, existence,
rights, franchises and privileges in the jurisdiction of its incorporation or
formation, as applicable, and qualify and remain qualified in good standing as a
foreign corporation or foreign limited liability company, as applicable, in each
jurisdiction where its business is conducted, except where the failure to so
preserve and maintain or qualify could not reasonably be expected to have a
Material Adverse Effect.
(d) Audits. Such Originator will furnish to P&L and its assigns from time
to time such information with respect to it and the Receivables sold by it as
P&L or its assigns may reasonably request. Such Originator will, from time to
time during regular business hours as requested by P&L or its assigns upon
reasonable notice and at the sole cost of such Originator, permit each of P&L
and its assigns, or their respective agents or representatives: (i) to examine
and make copies of and abstracts from all Records in the possession or under the
control of such Originator relating to the Receivables originated by it and the
associated Collections and Related Security, including, without limitation, the
related Invoices, and (ii) to visit the offices and properties of such
Originator for the purpose of examining such materials described in clause (i)
above, and to discuss matters relating to such Originator's financial condition
or the Receivables originated by it and the associated Collections and Related
Security or such Originator's (a) performance under any of the Transaction
Documents to which it is a party or any Person's performance under the Invoices
evidencing any Receivables originated by such Originator and, in each case, with
any of the officers or employees of such Originator having knowledge of such
matters.
(e) Keeping and Marking of Records and Books.
(i) Such Originator will maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing Receivables originated by it 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 such Receivables (including, without limitation,
records adequate to permit the immediate identification of each new
Receivable originated by it and all Collections of and adjustments to each
such existing Receivable). Such Originator will give P&L (and its assigns)
notice of any material change in the administrative and operating
procedures referred to in the previous sentence.
(ii) Such Originator will on or prior to the date hereof, xxxx its
master data processing records and other books and records relating to the
Receivables with the legend required by Section 3.1(i) hereof.
(f) Compliance with Contracts, Invoices and Credit and Collection Policy.
Such Originator will timely and fully (i) perform and comply with all material
provisions, covenants and other promises required to be observed by it under the
Contracts and Invoices related to the Receivables originated by it, and (ii)
comply in all material respects with the Credit and Collection Policy in regard
to each such Receivable and the related Invoice.
(g) Ownership. Such Originator will take all necessary action to (i) vest
legal and equitable title to the Receivables originated by it and the associated
Related Security and Collections irrevocably in P&L, free and clear of any
Adverse Claims other than Adverse Claims arising under the Transaction Documents
(including, without limitation, the filing of all financing statements or other
similar instruments or documents necessary under the UCC (or any comparable law)
of all appropriate jurisdictions to perfect P&L's interests in such Receivables,
Related Security and Collections and such other action to perfect, protect or
more fully evidence the interest of P&L as P&L or its assigns may reasonably
request), and (ii) establish and maintain, in favor of P&L, a valid and
perfected first priority ownership interest (and/or a valid and perfected first
priority security interest) in all such Receivables, Related Security and
Collections to the full extent contemplated herein, free and clear of any
Adverse Claims other than Adverse Claims arising under the Transaction Documents
(including, without limitation, the filing of all financing statements or other
similar instruments or documents necessary under the UCC (or any comparable law)
of all appropriate jurisdictions to perfect P&L's interest in such Receivables,
Related Security and Collections and such other action to perfect, protect or
more fully evidence the interests of P&L as P&L (or its assigns) may reasonably
request.
(h) SPV Separateness. Such Originator shall take all reasonable steps,
including, without limitation, all steps that P&L (or its assigns) may from time
to time reasonably request, to maintain such Originator's identity as a separate
legal entity from SPV and to make it manifest to third parties that such
Originator is an entity with assets and liabilities distinct from those of SPV.
(i) Collections. Such Originator shall direct all Obligors to make payments
of such Originator's Receivables directly to a Lock Box or Collection Account
that is the subject of a Collection Account Agreement at a Collection Bank. If,
notwithstanding the foregoing, any Obligor makes payment to such Originator,
such Originator further agrees to remit any Collections (including any security
deposits applied to the Outstanding Balance of any Receivable) that it receives
on such Receivables directly to a Collection Bank for deposit into a Collection
Account within two (2) Business Days after receipt thereof, and agrees that all
such Collections shall be deemed to be received in trust for P&L and its
assigns; provided that, to the extent permitted pursuant to Section 1.2, such
Originator may retain such Collections as a portion of the Purchase Price then
payable to or apply such Collections to the reduction of the outstanding balance
of its Subordinated Note.
(j) Taxes. Except to the extent that such Originator is included in
consolidated tax returns or reports filed by P&L, such Originator will file all
tax returns and reports required by law to be filed by it and will promptly pay
all taxes and governmental charges at any time owing, except any such taxes
which are not yet delinquent or are being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance with GAAP
shall have been set aside on its books.
Section 4.2 Negative Covenants. From such Originator's Applicable Closing
Date until the earlier to occur of such Originator's Sale Termination Date or
the date on which this Agreement terminates in accordance with its terms, such
Originator shall not:
(a) Name Change, Offices and Records. Change its name, identity or
organizational structure (within the meaning of Section 9-402(7) of any
applicable enactment of the UCC) or relocate its chief executive office or any
office where Records are kept unless it shall have: (i) given P&L and its
assigns at least thirty (30) days' prior written notice thereof and (ii)
delivered to P&L (or its assigns) all financing statements, instruments and
other documents requested by P&L (or its assigns) in connection with such change
or relocation.
(b) Change in Payment Instructions to Obligors. Make any change in the
instructions to Obligors regarding payments to be made to any Lock-Box or
Collection Account, unless P&L and its assigns shall have received, at least ten
(10) days before the proposed effective date therefor, (i) written notice of
such addition, termination or change and (ii) with respect to the addition of a
Collection Bank or a Collection Account or Lock-Box, an executed Collection
Account Agreement with respect to the new Collection Account or Lock-Box;
provided, however, that the Servicer may make changes in instructions to
Obligors regarding (a) payments if such new instructions require such Obligor to
make payments to another existing Collection Account.
(c) Modifications to Invoices. Extend, amend or otherwise modify the terms
of any Receivable or any Invoice related thereto except as otherwise directed by
the Servicer in accordance with the Credit and Collection Policy.
(d) Sales, Liens. Except pursuant to the Transaction Documents, sell,
assign (by operation of law or otherwise) or otherwise dispose of, or grant any
option with respect to, or create or suffer to exist any Adverse Claim upon
(including, without limitation, the filing of any financing statement) or with
respect to, any Receivable originated by it or the associated Collections and
other Related Security, or upon or with respect to any Invoice under which any
such Receivable arises, and will defend the right, title and interest of P&L and
its assigns in, to and under any of the foregoing property, against all claims
of third parties claiming through or under such Originator.
(e) Deposits to Collection Accounts and Collection Account. Deposit or
otherwise credit, or cause or permit to be so deposited or credited, to any
Collection Account, any cash or cash proceeds other than Collections of
Receivables.
(f) Mergers, Consolidations and Acquisitions. Liquidate or dissolve,
consolidate with, or merge into or with, any other Person (other than another
Originator) without the consent of P&L and its assigns under Section 8.5 if such
merger could reasonably be expected to have a Material Adverse Effect or to
result in a material adverse change in the nature or characteristics of such
Originator's Receivables taken as a whole, provided that, in connection with any
consolidation or merger (regardless of whether P&L's and its assigns' consent is
required pursuant hereto):
(A) each of P&L and its assigns pursuant to Section 8.5 receives
prior written notice of such consolidation or merger, and the
successor or surviving entity (if not an Originator) unconditionally
assumes such Originator's (or Originators') respective obligations
under the Transaction Documents to which it is (or they are) a party
immediately prior to giving effect to such consolidation or merger,
(B) all UCC financing statements necessary to maintain the
validity and perfection of P&L's and its assigns' ownership interests
in the Receivables and Related Security acquired or to be acquired
from such survivor under this Agreement have been duly executed and
filed in all necessary jurisdictions, and
(c) if the surviving entity in such transaction(s) is not an
existing Originator under this Agreement, all other documents required
to be delivered in connection with a Joinder Agreement hereunder have
been duly executed and delivered substantially contemporaneously with
such transaction(s).
(g) Receivables Not to be Evidenced by Promissory Notes. Take any
action to cause or permit any Receivable generated by it to become
evidenced by any "instrument" (as defined in the applicable UCC),
except in connection with the collection of overdue Receivables,
provided that the original of any such instrument is delivered to P&L
for immediate delivery to its assignees, duly endorsed.
(h) Accounting for Purchases. Account for the transactions
contemplated hereby in any manner other than as a sale by such
Originator to P&L of Receivables originated by such Originator and the
associated Collections and Related Security.
ARTICLE V.
JOINDER OF ADDITIONAL ORIGINATORS
Section 5.1 Addition of New Originators. From time to time upon not less
than 60 days' prior written notice to P&L and its assigns (or such shorter
period of time as P&L and its assigns may agree upon), P&L may agree that one or
more of its existing or hereafter acquired Subsidiaries of which it owns not
less than 75% of the outstanding voting securities become an Originator
hereunder. No such addition shall become effective (a) without the written
consent of P&L (and its assigns pursuant to Section 8.5) but may become
effective prior to such 60th day if such written consent is given more promptly
and (b) unless all conditions precedent to such addition required by Section 5.2
below are satisfied prior to such date.
Section 5.2 Documentation. In the event that P&L and its assigns pursuant
to Section 8.5 consent to the addition of a New Originator, such New Originator
shall execute a Joinder Agreement in the form of Exhibit C hereto (a "Joinder
Agreement") and shall deliver each of the documents, certificates and opinions
required to be delivered under Section 3.1 prior to such New Originator's
Closing Date, together with such updated Exhibits hereto as may be necessary to
ensure that after giving effect to the addition of such New Originator, each of
the representations and warranties of such New Originator under Article II
hereof will be true and correct, and P&L will deliver a Subordinated Note to
such New Originator.
ARTICLE VI.
ADDITIONAL RIGHTS AND OBLIGATIONS IN
RESPECT OF THE RECEIVABLES
Section 6.1 Rights of P&L. Each Originator hereby authorizes P&L and the
Servicer (if other than P&L or such Originator) or their respective designees
and assigns to take any and all steps in such Originator's name necessary or
desirable, in their respective determination, to collect all amounts due under
any and all Receivables originated by such Originator, including, without
limitation, endorsing such Originator's name on checks and other instruments
representing Collections and enforcing such Receivables, the Invoices and the
provisions of the related Contracts and Related Security that concern payment
and/or enforcement of rights to payment.
Section 6.2 Responsibilities of the Originators. Anything herein to the
contrary notwithstanding:
(a) Performance Under Contracts. Each Originator shall remain responsible
for performing its obligations hereunder and under the Contracts and Invoices
applicable to such Originator, and the exercise by P&L or its designees or
assigns of their rights hereunder shall not relieve any Originator from such
obligations.
(b) Power of Attorney. Each Originator hereby grants to the Servicer (if
other than such Originator) an irrevocable power of attorney, with full power of
substitution, coupled with an interest, to take in the name of such Originator
all steps necessary or advisable to endorse, negotiate or otherwise realize on
any writing or other right of any kind held or transmitted by such Originator or
transmitted or received by P&L (whether or not from such Originator) in
connection with any Receivables generated by such Originator.
Section 6.3 Further Action Evidencing Purchases. Each Originator agrees
that from time to time, at its expense, it will promptly execute and deliver all
further instruments and documents, and take all further action that P&L or any
of its assigns may reasonably request in order to perfect, protect or more fully
evidence P&L's ownership of the Receivables generated by such Originator (and
the Related Security) purchased by P&L hereunder, or to enable P&L to exercise
or enforce any of its rights hereunder or under any other Transaction Document.
Without limiting the generality of the foregoing, upon the request of P&L or any
of its assigns, each Originator will:
(a) 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
(b) xxxx its master ledger with the legend set forth in Section 3.1(i).
Each Originator hereby authorizes P&L or its designees or assigns to file one or
more financing or continuation statements, and amendments thereto and assignment
thereof, relative to all or any of the Receivables (and the Related Security)
now existing or hereafter sold by such Originator. If such Originator fails to
perform any of its agreements or obligations under this Agreement, P&L or its
designee may (but shall not be required to) itself perform, or cause performance
of, such agreement or obligation, and the expenses of P&L or its designee
incurred in connection therewith shall be payable by such Originator.
Section 6.4 Application of Collections. Except as otherwise specified by
such Obligor or required by the underlying Contract or Invoice or applicable
law: any payment by an Obligor in respect of any indebtedness owed by it to such
Originator or to P&L shall be applied first, as a Collection of any Receivable
or Receivables then outstanding of such Obligor in the order of the age of such
Receivables, starting with the oldest of such Receivables (unless another
reasonable basis for allocation of such payments to the Receivables of such
Obligor exists), and second, to any other indebtedness of such Obligor.
ARTICLE VII.
INDEMNIFICATION
Section 7.1 Indemnities by the Originators. Without limiting any other
rights that P&L or its assigns may have hereunder or under applicable law, each
Originator hereby agrees to indemnify (and pay upon demand to) P&L and its
assigns, officers, managers, directors, agents and employees (each an
"Indemnified Party") from and against any and all damages, losses, claims,
taxes, liabilities, costs, expenses and for all other amounts payable, including
reasonable attorneys' fees (which attorneys may be employees of any Indemnified
Party) 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 as a result of this Agreement or the acquisition, either directly or
indirectly, by P&L of any Receivable originated by such Originator, excluding,
however, in all of the foregoing instances:
(a) Indemnified Amounts to the extent a final judgment of a court of
competent jurisdiction holds that such Indemnified Amounts resulted from gross
negligence or willful misconduct on the part of the Indemnified Party seeking
indemnification;
(b) Indemnified Amounts to the extent the same includes losses in respect
of Receivables that are uncollectible on account of the insolvency, bankruptcy
or lack of creditworthiness of the related Obligor; or
(c) taxes imposed by the jurisdiction in which such Indemnified Party's
principal executive office is located, on or measured by the overall net income
of such Indemnified Party to the extent that the computation of such taxes is
consistent with the characterization for income tax purposes of the acquisition
by P&L of Receivables as a true sale by such Originator to P&L of such
Receivables and the associated Related Security;
provided, however, that nothing contained in this sentence shall limit the
liability of such Originator or limit the recourse of P&L and its assigns for
amounts otherwise specifically provided to be paid by such Originator under the
terms of this Agreement. Without limiting the generality of the foregoing
indemnification, but subject to the exclusions in clauses (a), (b) and (c)
above, each Originator shall indemnify the Indemnified Parties and its assigns
for Indemnified Amounts (including, without limitation, losses in respect of
uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to such Originator) relating to or resulting from:
(i) any representation or warranty made by such Originator (or any of
its officers) under or in connection with this Agreement, any other
Transaction Document to which such Originator is a party or any other
information or report delivered by any such Person pursuant hereto or
thereto, which shall have been false or incorrect when made or deemed made;
(ii) the failure by such Originator to comply with any applicable law,
rule or regulation with respect to any Receivable originated by it, or any
Contract or Invoice related thereto, or the nonconformity of any such
Receivable, Contract or Invoice with any such applicable law, rule or
regulation or any failure of any Originator to keep or perform any of its
obligations, express or implied, with respect to any such Contract or
Invoice;
(iii) any failure of such Originator to perform its duties, covenants
or other obligations in accordance with the provisions of this Agreement or
any other Transaction Document to which it is a party;
(iv) any products liability, personal injury or damage suit, or other
similar claim arising out of or in connection with goods that are the
subject of any Contract or Invoice or any Receivable originated by such
Originator;
(v) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
originated by such Originator (including, without limitation, a defense
based on such Receivable or the related Contract or Invoice 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 goods related to such Receivable or the furnishing or failure to furnish
such goods;
(vi) the commingling of Collections of such Receivables at any time
with other funds;
(vii) any investigation, litigation or proceeding related to or
arising from this Agreement or any other Transaction Document to which such
Originator is a party, the transactions contemplated hereby, the use by
such Originator of the proceeds of any purchase from it hereunder or any
other investigation, litigation or proceeding relating to such Originator
in which any Indemnified Party becomes involved as a result of any of the
transactions contemplated hereby;
(viii) any inability to litigate any claim against any Obligor in
respect of any such Receivable as a result of such Obligor being immune
from civil and commercial law and suit on the grounds of sovereignty or
otherwise from any legal action, suit or proceeding;
(ix) (A) failure of such Originator generally to pay its debts as such
debts become due or admission by such Originator in writing of its
inability to pay its debts generally or any making by such Originator of a
general assignment for the benefit of creditors; or (B) the institution of
any proceeding by or against such Originator seeking to adjudicate it
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its
debts under any law relating to bankruptcy, insolvency or reorganization or
relief of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or any
substantial part of its property, or (C) the taking by such Originator of
any corporate action to authorize any of the actions set forth in clauses
(A) or (B) above in this clause (ix);
(x) any failure to vest and maintain vested in P&L or its assigns
(subject to the Transaction Documents), or to transfer to P&L, legal and
equitable title to, and ownership of, a first priority perfected ownership
interest in the Receivables originated by such Originator and the
associated Related Security and Collections, free and clear of any Adverse
Claim (except as created by the Transaction Documents); and
(xi) the failure to have filed, or any delay in filing, financing
statements or other similar instruments or documents under the UCC of any
applicable jurisdiction or other applicable laws with respect to any such
Receivable, the Related Security and Collections with respect thereto, and
the proceeds of any thereof, whether at the time of sale to P&L or at any
subsequent time.
Section 7.2 Costs, Expenses and Taxes. In addition to the obligations of
each Originator under Section 7.1, each Originator agrees to pay on demand:
(a) all reasonable costs and expenses, including attorneys' fees, in
connection with the enforcement against such Originator of this Agreement and
the other Transaction Documents executed by such Originator; and
(b) all stamp duties and other similar filing or recording taxes and fees
payable or determined to be payable in connection with the execution, delivery,
filing and recording of this Agreement or the other Transaction Documents
executed by such Originator, and agrees to indemnify Indemnified Parties against
any liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and fees.
ARTICLE VIII.
MISCELLANEOUS
Section 8.1 Waivers and Amendments. The provisions of this Agreement may
from time to time be amended, restated, otherwise modified or waived, if such
amendment, modification or waiver is in writing and consented to by P&L and its
assigns pursuant to Section 8.5. No failure or delay on the part of P&L, such
assigns or any third party beneficiary in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or demand on
any party hereto, SPV or the Agent in any case shall entitle it to any notice or
demand in similar or other circumstances. No waiver or approval by P&L or its
assigns under this Agreement shall, except as may otherwise be stated in such
waiver or approval, be applicable to subsequent transactions. No waiver or
approval under this Agreement shall require any similar or dissimilar waiver or
approval thereafter to be granted hereunder.
Section 8.2 Notices, Etc. All notices and other communications provided for
hereunder shall, unless otherwise stated herein, be in writing (including
facsimile communication) and shall be personally delivered or sent by express
mail or courier or by certified mail, postage-prepaid, or by facsimile, to the
intended party (a) in the case of any Originator, to it in care of P&L at its
address set forth in the Receivables Purchase Agreement, and in the case of P&L,
to it at its address set forth in the Receivables Purchase Agreement, or, in
each of the foregoing cases, at such other address 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, (i) if personally delivered
or sent by express mail or courier or if sent by certified mail, when received,
and (ii) if transmitted by facsimile, when sent, receipt confirmed by telephone
or electronic means.
Section 8.3 Cumulative Remedies. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
Section 8.4 Binding Effect; Assignability. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective successors and
permitted assigns; provided, however, that no Originator may assign its rights
hereunder or any interest herein without the prior written consent of P&L and
its assigns pursuant to Section 8.5. 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 the date after the Facility
Termination Date on which all Aggregate Unpaids under the Receivables Purchase
Agreement have been paid in full. The rights and remedies with respect to any
breach of any representation and warranty made by any Originator pursuant to
Article II and the indemnification and payment provisions of Article V shall be
continuing and shall survive any termination of this Agreement.
Section 8.5 Acknowledgment and Agreement. Each of the Originators hereby
expressly acknowledges and agrees that all of P&L's rights, title, and interests
in, to, and under this Agreement shall be assigned by P&L to SPV pursuant to the
Receivables Contribution Agreement, and by SPV to the Agent, for the benefit of
the Purchasers, pursuant to the Receivables Purchase Agreement, and each of the
Originators consents to such assignments. Each of the parties hereto
acknowledges and agrees that SPV, the Agent and the Purchasers are third party
beneficiaries of the rights of P&L arising hereunder and under the other
Transaction Documents to which P&L is a party. Each of the Originators further
acknowledges and agrees that all right, title and interest in and to the
Lock-Boxes and Collection Accounts has been transferred to and vested in SPV and
its assigns, and SPV may at any time in its sole discretion (subject to the
terms of the Receivables Purchase Agreement and the Collection Account
Agreements executed in connection therewith) direct and re-direct payments from
such Lock-Boxes and Collection Accounts.
Section 8.6 GOVERNING LAW. EACH TRANSACTION DOCUMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS, without
regard to the principles of conflicts of laws thereof EXCEPT TO THE EXTENT THAT
THE PERFECTION OF THE OWNERSHIP INTERESTS OF SPV IS GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF ILLINOIS.
Section 8.7 Submission to Jurisdiction. EACH PARTY HERETO HEREBY
IRREVOCABLY (a) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY ILLINOIS STATE
OR UNITED STATES FEDERAL COURT SITTING IN CHICAGO, ILLINOIS, OVER ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO ANY TRANSACTION DOCUMENT; (b) AGREES
THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND
DETERMINED IN SUCH COURT; (c) WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY
DO SO UNDER APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING; (d) CONSENTS TO THE SERVICE OF ANY AND
ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES OF SUCH
PROCESS TO SUCH PERSON AT ITS ADDRESS SPECIFIED IN SECTION 6.2; AND (e) TO THE
EXTENT ALLOWED BY LAW, AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR
PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS
SECTION 6.7 SHALL AFFECT BUYER'S RIGHT TO SERVE LEGAL PROCESS IN ANY OTHER
MANNER PERMITTED BY LAW OR TO BRING ANY ACTION OR PROCEEDING AGAINST ANY
ORIGINATOR OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.
Section 8.8 Waiver of Jury Trial. EACH PARTY HERETO EXPRESSLY WAIVES ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHTS UNDER THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT, OR UNDER ANY
AMENDMENT, INSTRUMENT, JOINDER AGREEMENT OR DOCUMENT DELIVERED OR WHICH MAY IN
THE FUTURE BE DELIVERED BY IT OR ON ITS BEHALF IN CONNECTION HEREWITH OR ARISING
FROM ANY RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
TRANSACTION DOCUMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE
TRIED BEFORE A COURT AND NOT BEFORE A JURY.
Section 8.9 Captions and Cross References; Incorporation by Reference. The
various captions (including, without limitation, the table of contents) in this
Agreement are included for convenience only and shall not affect the meaning or
interpretation of any provision of this Agreement. References in this Agreement
to any underscored Section or Exhibit are to such Section or Exhibit of this
Agreement, as the case may be. The Exhibits hereto are hereby incorporated by
reference into and made a part of this Agreement.
Section 8.10 Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which so executed shall be deemed to be an original and
all of which taken together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.
Big Sky Coal Company,
Caballo Coal Company,
Eastern Associated Coal Corp.,
Peabody COALSALES Company,
Peabody Coal Company,
Peabody Western Coal Company,
Powder River Coal Company,
Seneca Coal Company and
Pine Ridge Coal Company
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Vice President and Treasurer
By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Vice President
P&L COAL HOLDINGS CORPORATION
By: /s/ Xxxxxx X. Xxxx
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Name: Xxxxxx X. Xxxx
Title: Assistant Treasurer
EXHIBIT A
DEFINITIONS
A. Incorporation of Receivables Purchase Agreement Definitions. Unless
otherwise defined herein, terms that are capitalized and used throughout this
Agreement are used as defined in the Receivables Purchase Agreement (hereinafter
defined).
B. Certain Defined Terms. The following terms have the respective meanings
indicated hereinbelow:
"Additional Receivables" means, with respect to any Originator, all
Receivables of such Originator arising after the close of such Originator's
business on the Initial Cut-Off Date (in the case of each of the Initial
Originators) or the applicable New Originator Cut-Off Date (in the case of any
New Originator) through and including such Originator's Sale Termination Date.
"Agreement" means this Receivables Sale Agreement, as it may be amended or
modified and in effect from time to time in accordance with the terms hereof.
"Applicable Closing Date" means (i) with respect to each of the Initial
Originators, the Initial Closing Date, and (ii) with respect to each New
Originator, its New Originator Closing Date.
"Applicable Cut-Off Date" means (i) with respect to each Initial
Originator, the Initial Cut-Off Date, (ii) with respect to each New Originator,
its New Originator Cut-Off Date, and (iii) with respect to all Originators, each
Cut-Off Date after the applicable date in the preceding clause (i) or clause
(ii).
"Charged-Off Trigger Ratio" means, as of any Cut-Off Date, the ratio
(expressed as a percentage) computed by dividing (x) the total amount of
Receivables that became Charged-Off Receivables during the Measurement Period
ending on such Cut-Off Date, by (y) the aggregate Outstanding Balance of all
Receivables as of such Cut-Off Date.
"Deemed Collections" means the aggregate of all amounts an Originator shall
have been deemed to have received as a Collection of a Receivable sold by it. An
Originator shall be deemed to have received a Collection (but only to the extent
of the reduction or cancellation identified below) of a Receivable sold by it if
at any time (i) the Outstanding Balance of any such Receivable is either (x)
reduced as a result of any defective or rejected goods, any discount or any
adjustment or otherwise by such Originator (other than cash Collections on
account of the Receivables) or (y) reduced or canceled as a result of a setoff
in respect of any claim by any Person (whether such claim arises out of the same
or a related transaction or an unrelated transaction) or (ii) any of the
representations or warranties in Article II were not true with respect to such
Receivable at the time of its sale hereunder.
"Default Rate" means the sum of the Prime Rate plus 2.0% per annum
(computed for actual days elapsed on the basis of a year consisting of 365, or
when appropriate, 366 days).
"Discount Factor" means, at any time, a ratio (expressed as a decimal)
calculated in accordance with the most recent Weekly Report in accordance with
the following formula:
---- ----
DF = CTR + | (AM + 4) x (CFR + 0.02) |
| ----------------------- |
| 360 |
| |
---- ----
where:
DF = the Discount Factor;
CTR = the Charged-Off Trigger Ratio;
AM = the period (expressed in days) equal to the weighted averaged maturity
of the outstanding Receivables; and
CFR = the sum of (i) the weighted average of the "Discount Rates" and the
annualized per annum equivalent interest rate of the "CP Costs" of all Purchaser
Interests outstanding under the Receivables Purchase Agreement, plus (ii) the
weighted average annualized fees payable by SPV in respect of the Receivables
Purchase Agreement, determined as a percentage of Capital,
in each case, determined as of the date set forth in such Weekly Report.
"Event of Bankruptcy" means an event in which (i) a Person shall generally
not pay its debts as such debts become due or shall admit in writing its
inability to pay its debts generally or shall make a general assignment for the
benefit of creditors or (ii) any proceeding shall be instituted by or against a
Person seeking to adjudicate it bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts under any law relating to bankruptcy, insolvency
or reorganization or relief of debtors, or seeking the entry of an order for
relief or the appointment of a receiver, trustee or other similar official for
it or any substantial part of its property or (iii) a Person shall take any
corporate action to authorize any of the actions set forth in clauses (i) or
(ii) above.
"Initial Closing Date" means the Effective Date under the Receivables
Purchase Agreement.
"Initial Cut-Off Date" means the Cut-Off Date immediately preceding the
Initial Closing Date.
"Initial Originators" has the meaning set forth in the preamble of this
Agreement.
"Initial Receivables" means, with respect to any Originator, all
Receivables of such Originator that existed and were owing to such Originator as
of the close of such Originator's business on the Initial Cut-Off Date (in the
case of each of the Initial Originators) or the applicable New Originator
Cut-Off Date (in the case of any New Originator).
"Joinder Agreement" has the meaning set forth in Section 5.2 hereof.
"Material Adverse Effect" means, with respect to any Originator, a material
adverse effect on (i) the ability of such Originator to perform its obligations
under this Agreement, (ii) the legality, validity or enforceability of this
Agreement or any other Transaction Document to which such Originator is a party,
(iii) P&L's ownership interest in the Receivables generally or in any
significant portion of the Receivables, the Related Security or the Collections
with respect thereto, in each case, relating to Receivables sold by such
Originator hereunder, or (iv) the collectibility of the Receivables generally or
of any material portion of the Receivables, in each case, relating to
Receivables sold by such Originator hereunder.
"Monthly Report" has the meaning specified in the Receivables Contribution
Agreement.
"New Originator" means any direct or indirect Subsidiary of which P&L owns
not less than 75% of each class of the outstanding capital stock or other equity
interests that hereafter becomes a Originator under this Agreement by executing
a Joinder Agreement and complying with the provisions of Article V hereof.
"New Originator Closing Date" means, as to any New Originator, the Business
Day on which each of the conditions set forth in Article V has been satisfied.
"New Originator Cut-Off Date" means, with respect to each New Originator,
the Cut-Off Date immediately preceding its New Originator Closing Date.
"Organic Documents" means with respect to (i) a corporation, such Person's
articles or certificate of incorporation and its by-laws, (ii) with respect to a
limited liability company, such Person's certificate of formation and limited
liability company or operating agreement (or similar agreement among such
Person's members), (iii) with respect to a limited partnership, such Person's
certificate of limited partnership (or other equivalent) and partnership
agreement, and (iv) with respect to any other Person, such Person's
organizational charter as required by the jurisdiction of such Person's
organization and any other agreement or document evidencing the rights of
holders of equity interests in such Person and/or the rights of any officers,
directors or managers of such Person.
"Originator" means an Initial Originator or a New Originator.
"P&L" has the meaning specified in the preamble of this Agreement.
"Purchase Price" means, with respect to any purchase of Receivables and
their Related Security from an Originator on any date, the aggregate price to be
paid therefor by P&L to the applicable Originator in accordance with Section 1.2
of this Agreement on such date, which price shall equal (i) the product of (x)
the Outstanding Balance of such Receivables as of the Applicable Cut-Off Date,
multiplied by (y) one minus the Discount Factor then in effect, minus (ii) any
Purchase Price Credits to be credited against the Purchase Price otherwise
payable in accordance with Section 1.3(a) of this Agreement, and plus (iii) any
Purchase Price Increases to be made to the Purchase Price otherwise payable in
accordance with section 1.3(b) of this Agreement.
"Purchase Price Credit" has the meaning set forth in Section 1.3(a) hereof.
"Purchase Price Increase" has the meaning set forth in Section 1.3(b)
hereof.
"Receivables Contribution Agreement" means that certain Receivables
Contribution Agreement dated as of March 31, 2000, by and between P&L and SPV,
as amended, restated or otherwise modified from time to time in accordance with
the terms thereof and of the Receivables Purchase Agreement.
"Receivables Purchase Agreement" means that certain Receivables Purchase
Agreement dated as of March 31, 2000, by and among SPV, as Seller, P&L, as
initial Servicer, International Securitization Corporation, the Financial
Institutions from time to time party thereto, and Bank One, NA, as Agent, as
amended, restated or otherwise modified from time to time in accordance with the
terms thereof.
"Related Security" means, with respect to any Receivable:
(i) all of the applicable Originator's interest in the inventory and goods
(including returned or repossessed inventory or goods), if any, the sale,
financing or lease of which by such Originator gave rise to such Receivable, and
all insurance contracts with respect thereto,
(ii) all other security interests or liens and property subject thereto
from time to time, if any, purporting to secure payment of such Receivable,
whether pursuant to the Contract or Invoice related to such Receivable or
otherwise, together with all financing statements and security agreements
describing any collateral securing such Receivable,
(iii) all guaranties, letters of credit, insurance and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Receivable whether pursuant to the Contract or Invoice related
to such Receivable or otherwise,
(iv) all Records related to such Receivable, and
(v) all proceeds of any of the foregoing;
provided, however, that in no event shall "Related Security" include any
right, duty or obligation under any Contract other than that the right to
receive payments thereunder (and any collateral for, guaranty of or letter of
credit, surety bond or other credit support for any such payment right).
"Sale Termination Date" means, with respect to each Originator, the
earliest to occur of (i) the Facility Termination Date under the Receivables
Purchase Agreement, (ii) the Termination Date under the Receivables Contribution
Agreement, (iii) the date on which an Event of Bankruptcy occurs with respect to
such Originator, (iv) the date on which a merger or consolidation occurs with
respect to such Originator that does not comply with the requirements of Section
4.2(f), (v) if such Originator is a Material Originator, the date on which a
Change of Control occurs with respect to it to which P&L and its assigns under
Section 8.5 do not give their prior written consent, (vi) following breach by
such Originator of any of its material covenants or agreements contained in this
Agreement, the date specified by P&L or its assigns under Section 8.5 in a
written notice delivered to and received by such Originator, and (vii) the date
specified by such Originator in a written notice delivered to and received by
P&L and its assigns under Section 8.5.
"SPV" means P&L Receivables Company, LLC, a Delaware limited liability
company.
"Subordinated Loan" means a subordinated revolving loan from an Originator
to P&L which is evidenced by a Subordinated Note.
"Subordinated Note" means a subordinated promissory note in the form of
Exhibit B hereto issued by P&L to an Originator, as it may be amended,
supplemented, endorsed or otherwise modified from time to time in substitution
therefor or renewal thereof in accordance with the Transaction Documents.
All accounting terms not specifically defined herein shall be construed in
accordance with GAAP. All terms used in Article 9 of the UCC in the State of
Illinois, and not specifically defined herein, are used herein as defined in
such Article 9.
