EXHIBIT 10.3
CREDIT AND SECURITY AGREEMENT
DATED AS OF JANUARY 31, 2003
AMONG
XXXXXX RECEIVABLES CORPORATION, AS BORROWER,
A.T. XXXXXX COAL COMPANY, INC., AS SERVICER,
BLUE RIDGE ASSET FUNDING CORPORATION,
THE LIQUIDITY BANKS FROM TIME TO TIME PARTY HERETO
AND
WACHOVIA BANK, NATIONAL ASSOCIATION, AS AGENT
TABLE OF CONTENTS
Page
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Article I The Advances................................................................ 1
Section 1.1 Credit Facility.................................................. 1
Section 1.2 Increases........................................................ 2
Section 1.3 Decreases........................................................ 2
Section 1.4 Deemed Collections; Borrowing Limit.............................. 3
Section 1.5 Payment Requirements............................................. 4
Section 1.6 Ratable Loans; Funding Mechanics; Liquidity Fundings............. 4
Article II Payments and Collections................................................... 4
Section 2.1 Recourse Obligations............................................. 4
Section 2.2 Collections Prior to Amortization................................ 5
Section 2.3 Collections Following Amortization............................... 6
Section 2.4 Payment Rescission............................................... 6
Section 2.5 Calculation of CP Costs, Interest, Etc........................... 7
Article III Blue Ridge Funding........................................................ 7
Section 3.1 CP Costs......................................................... 7
Section 3.2 [reserved]....................................................... 7
Section 3.3 CP Costs Payments................................................ 7
Section 3.4 Default Rate..................................................... 7
Article IV Liquidity Bank Funding..................................................... 7
Section 4.1 Liquidity Bank Funding........................................... 7
Section 4.2 Interest Payments................................................ 8
Section 4.3 Selection and Continuation of Interest Periods................... 8
Section 4.4 Liquidity Bank Interest Rates.................................... 8
Section 4.5 Suspension of the LIBO Rate...................................... 8
Section 4.6 Default Rate..................................................... 9
Article V Representations and Warranties.............................................. 9
Section 5.1 Representations and Warranties of the Loan Parties............... 9
Article VI Conditions of Advances..................................................... 13
Section 6.1 Conditions Precedent to Initial Advance.......................... 13
Section 6.2 Conditions Precedent to All Advances and Reinvestments........... 13
Article VII Covenants................................................................. 14
Section 7.1 Affirmative Covenants of the Loan Parties........................ 14
Section 7.2 Negative Covenants of the Loan Parties........................... 23
Article VIII Administration and Collection............................................ 24
Section 8.1 Designation of Servicer.......................................... 24
Section 8.2 Duties of Servicer............................................... 25
Section 8.3 Collection Notices............................................... 26
Section 8.4 Responsibilities of Borrower..................................... 27
Section 8.5 Monthly Reports.................................................. 27
Section 8.6 Servicing Fee.................................................... 27
Article IX Amortization Events........................................................ 27
Section 9.1 Amortization Events.............................................. 27
Section 9.2 Remedies......................................................... 30
Article X Indemnification............................................................. 30
Section 10.1 Indemnities by the Loan Parties.................................. 30
Section 10.2 Increased Cost and Reduced Return................................ 34
Section 10.3 Other Costs and Expenses......................................... 35
Section 10.4 Allocations...................................................... 35
Article XI The Agent.................................................................. 35
Section 11.1 Authorization and Action......................................... 35
Section 11.2 Delegation of Duties............................................. 36
Section 11.3 Exculpatory Provisions........................................... 36
Section 11.4 Reliance by Agent................................................ 37
Section 11.5 Non-Reliance on Agent and Other Lenders.......................... 37
Section 11.6 Reimbursement and Indemnification................................ 37
Section 11.7 Agent in its Individual Capacity................................. 37
Section 11.8 Successor Agent.................................................. 38
Article XII Assignments; Participations............................................... 38
Section 12.1 Assignments...................................................... 38
Section 12.2 Participations................................................... 39
Article XIII Security Interest........................................................ 39
Section 13.1 Grant of Security Interest....................................... 39
Section 13.2 Termination after Final Payout Date.............................. 40
Article XIV Miscellaneous............................................................. 40
Section 14.1 Waivers and Amendments........................................... 40
Section 14.2 Notices.......................................................... 41
Section 14.3 Ratable Payments................................................. 41
Section 14.4 Protection of Agent's Security Interest.......................... 42
Section 14.5 Confidentiality.................................................. 42
Section 14.6 Bankruptcy Petition.............................................. 43
Section 14.7 Limitation of Liability.......................................... 43
Section 14.8 CHOICE OF LAW.................................................... 43
Section 14.9 CONSENT TO JURISDICTION.......................................... 44
Section 14.10 WAIVER OF JURY TRIAL............................................. 44
Section 14.11 Integration; Binding Effect; Survival of Terms................... 44
Section 14.12 Counterparts; Severability; Section References................... 45
Section 14.13 Wachovia Roles................................................... 45
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EXHIBITS
Exhibit I Definitions
Exhibit II Form of Borrowing Notice
Exhibit III Jurisdiction of Organization, Places of Business of the
Loan Parties; Locations of Records; Federal Employer
Identification Number(s); Other Names
Exhibit IV Names of Collection Banks; Collection Accounts
Exhibit V Form of Compliance Certificate
Exhibit VI Form of Collection Account Agreement
Exhibit VII Form of Assignment Agreement
Exhibit VIII Credit and Collection Policy
Exhibit IX Form of Monthly Report
Exhibit X [reserved]
Exhibit XI Form of Performance Undertaking
SCHEDULES
Schedule A Commitments
Schedule B Closing Documents
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CREDIT AND SECURITY AGREEMENT
THIS CREDIT AND SECURITY AGREEMENT, dated as of January 31, 2003 is
entered into by and among:
(a) Xxxxxx Receivables Corporation, a Delaware corporation
("Borrower"),
(b) A.T. Xxxxxx Coal Company, Inc., a Virginia corporation
("A.T.Xxxxxx"), as initial Servicer (the Servicer together with Borrower, the
"Loan Parties" and each, a "Loan Party"),
(c) The entities listed on Schedule A to this Agreement (together
with any of their respective successors and assigns hereunder, the "Liquidity
Banks"),
(d) Blue Ridge Asset Funding Corporation, a Delaware corporation
("Blue Ridge"), and
(e) Wachovia Bank, National Association, as agent for the Lenders
hereunder or any successor agent hereunder (together with its successors and
assigns hereunder, the "Agent").
Unless defined elsewhere herein, capitalized terms used in this
Agreement shall have the meanings assigned to such terms in Exhibit I.
PRELIMINARY STATEMENTS
Borrower desires to borrow from the Lenders from time to time.
Blue Ridge may, in its absolute and sole discretion, make Advances to
Borrower from time to time.
In the event that Blue Ridge declines to make any Advance, the Liquidity
Banks shall, at the request of Borrower, make Advances from time to time.
Wachovia Bank, National Association has been requested and is willing to
act as Agent on behalf of Blue Ridge and the Liquidity Banks in accordance with
the terms hereof.
ARTICLE I
THE ADVANCES
SECTION 1.1 CREDIT FACILITY.
(a) Upon the terms and subject to the conditions hereof, from time
to time prior to the Facility Termination Date:
(i) Borrower may, at its option, request Advances from the
Lenders in an aggregate principal amount at any one time outstanding not
to exceed the lesser of the
Aggregate Commitment and the Borrowing Base (such lesser amount, the
"Borrowing Limit"); and
(ii) Blue Ridge may, at its option, make the requested
Advance, or if Blue Ridge shall decline to make any Advance, except as
otherwise provided in Section 1.2, the Liquidity Banks severally agree
to make Loans in an aggregate principal amount equal to the requested
Advance.
Each of the Advances, and all other Obligations, shall be secured by the
Collateral as provided in Article XIII. It is the intent of Blue Ridge to fund
all Advances by the issuance of Commercial Paper.
(b) Borrower may, upon at least 10 days' notice to the Agent,
terminate in whole or reduce in part, ratably among the Liquidity Banks, the
unused portion of the Aggregate Commitment; provided that each partial reduction
of the Aggregate Commitment shall be in an amount equal to at least $10,000,000
(or a larger integral multiple of $1,000,000 if in excess thereof) and shall
reduce the Commitments of the Liquidity Banks ratably in accordance with their
respective Pro Rata Shares.
SECTION 1.2 INCREASES.
Borrower shall provide the Agent with at least two (2) Business Days'
prior notice in a form set forth as Exhibit II hereto of each Advance (each, a
"Borrowing Notice"). Each Borrowing Notice shall be subject to Section 6.2
hereof and, except as set forth below, shall be irrevocable and shall specify
the requested increase in Aggregate Principal (which shall not be less than
$1,000,000 or a larger integral multiple of $100,000) and the Borrowing Date
(which, in the case of any Advance after the initial Advance hereunder, shall
only be on a Settlement Date) and, in the case of an Advance to be funded by the
Liquidity Banks, the requested Interest Rate and Interest Period. Following
receipt of a Borrowing Notice, the Agent will determine whether Blue Ridge
agrees to make the requested Advance. If Blue Ridge declines to make a proposed
Advance, Borrower may cancel the Borrowing Notice or, in the absence of such a
cancellation, the Advance will be made by the Liquidity Banks. On the date of
each Advance, upon satisfaction of the applicable conditions precedent set forth
in Article VI, Blue Ridge or the Liquidity Banks, as applicable, shall deposit
to the Facility Account an amount equal to (a) in the case of Blue Ridge, the
principal amount of the requested Advance or (b) in the case of a Liquidity
Bank, such Liquidity Bank's Pro Rata Share of the principal amount of the
requested Advance.
SECTION 1.3 DECREASES.
Except as provided in Section 1.4, Borrower shall provide the Agent with
prior written notice in conformity with the Required Notice Period (a "Reduction
Notice") of any proposed reduction of Aggregate Principal. Such Reduction Notice
shall designate (a) the date (the "Proposed Reduction Date") upon which any such
reduction of Aggregate Principal shall occur (which date shall give effect to
the applicable Required Notice Period), and (b) the amount of Aggregate
Principal to be reduced which shall be applied ratably to the Loans of Blue
Ridge and the Liquidity Banks in accordance with the amount of principal (if
any) owing to Blue Ridge, on
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the one hand, and the amount of principal (if any) owing to the Liquidity Banks
(ratably, based on their respective Pro Rata Shares), on the other hand (the
"Aggregate Reduction"). Only one (1) Reduction Notice shall be outstanding at
any time.
SECTION 1.4 DEEMED COLLECTIONS; BORROWING LIMIT.
(a) If on any day:
(i) the Outstanding Balance of any Receivable is reduced as
a result of any defective or rejected goods or services, any cash
discount or any other adjustment by any Originator or any Affiliate
thereof, or as a result of any tariff or other governmental or
regulatory action, or
(ii) the Outstanding Balance of any Receivable is reduced or
canceled as a result of a setoff in respect of any claim by the Obligor
thereof (whether such claim arises out of the same or a related or an
unrelated transaction), or
(iii) the Outstanding Balance of any Receivable is reduced on
account of the obligation of any Originator or any Affiliate thereof to
pay to the related Obligor any rebate or refund, or
(iv) the Outstanding Balance of any Receivable is less than
the amount included in calculating the Net Pool Balance for purposes of
any Monthly Report (for any reason other than such Receivable becoming a
Defaulted Receivable), or
(v) any of the representations or warranties of Borrower set
forth in Section 5.1(i), (j), (r), (s), (t) or (u) were not true when
made with respect to any Receivable,
then, on such day, Borrower shall be deemed to have received a Collection of
such Receivable (A) in the case of clauses (i)-(iv) above, in the amount of such
reduction or cancellation or the difference between the actual Outstanding
Balance and the amount included in calculating such Net Pool Balance, as
applicable; and (B) in the case of clause (v) above, in the amount of the
Outstanding Balance of such Receivable and not later than two (2) Business Days
thereafter shall pay to the Agent's Account the amount of any such Collection
deemed to have been received in the same manner as actual cash collections are
distributed under the terms of this Agreement. In the case of any Receivable as
to which any Deemed Collection of the full Outstanding Balance thereof is
received as provided for in subclause (B) above, then, upon identification of
such Receivable in the next following Monthly Report, the Agent's security
interest in such Receivable and the Related Security thereto shall be
automatically released.
(b) Borrower shall ensure that the Aggregate Principal at no time
exceeds the Borrowing Limit. If at any time the Aggregate Principal exceeds the
Borrowing Limit, Borrower shall immediately pay to the Agent, in immediately
available funds, an amount to be applied to reduce the Aggregate Principal (as
allocated by the Agent), such that after giving effect to such payment the
Aggregate Principal is less than or equal to the Borrowing Limit.
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SECTION 1.5 PAYMENT REQUIREMENTS.
All amounts to be paid or deposited by any Loan Party pursuant to any
provision of this Agreement shall be paid or deposited in accordance with the
terms hereof no later than 11:00 a.m. (New York time) on the day when due in
immediately available funds, and if not received by 11:00 a.m. (New York time)
shall be deemed to be received on the next succeeding Business Day. If such
amounts are payable to a Lender they shall be paid to the Agent's Account, for
the account of such Lender, until otherwise notified by the Agent. Upon notice
to Borrower, the Agent may debit the Facility Account for all amounts due and
payable hereunder. All computations of CP Costs, Interest, per annum fees
calculated as part of any CP Costs, per annum fees hereunder and per annum fees
under the Fee Letter shall be made on the basis of a year of 360 days for the
actual number of days elapsed. If any amount hereunder shall be payable on a day
which is not a Business Day, such amount shall be payable on the next succeeding
Business Day.
SECTION 1.6 RATABLE LOANS; FUNDING MECHANICS; LIQUIDITY FUNDINGS.
(a) Each Advance hereunder shall consist of one or more Loans made
by Blue Ridge and/or the Liquidity Banks.
(b) Each Lender funding any Loan shall transfer the principal amount
of its Loan to the Agent on the applicable Borrowing Date and, subject to its
receipt of such Loan proceeds, the Agent shall transfer such funds to the
account maintained by Borrower with Wachovia Bank, National Association on such
Borrowing Date.
(c) While it is the intent of Blue Ridge to fund each requested
Advance through the issuance of its Commercial Paper, the parties acknowledge
that if Blue Ridge is unable, or Blue Ridge or the Agent determines that it is
undesirable, to issue Commercial Paper to fund all or any portion of its Loans,
or is unable to repay such Commercial Paper upon the maturity thereof, Blue
Ridge may put all or any portion of its Loans to the Liquidity Banks at any time
pursuant to the Liquidity Agreement to finance or refinance the necessary
portion of its Loans through a Liquidity Funding to the extent available. The
Liquidity Fundings may be Alternate Base Rate Loans or LIBO Rate Loans, or a
combination thereof, selected by Borrower in accordance with Article IV.
Regardless of whether a Liquidity Funding constitutes the direct funding of a
Loan, an assignment of a Loan made by Blue Ridge or the sale of one or more
participations in a Loan made by Blue Ridge, each Liquidity Bank participating
in a Liquidity Funding shall have the rights of a "Lender" hereunder with the
same force and effect as if it had directly made a Loan to Borrower in the
amount of its Liquidity Funding.
(d) Nothing herein shall be deemed to commit Blue Ridge to make
Loans.
ARTICLE II
PAYMENTS AND COLLECTIONS
SECTION 2.1 RECOURSE OBLIGATIONS.
Borrower hereby promises to pay the following (collectively, the
"Obligations"):
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(a) the Aggregate Principal on and after the Facility Termination
Date as and when Collections are received;
(b) the fees set forth in the Fee Letter on the dates specified
therein;
(c) all accrued and unpaid Interest on the Alternate Base Rate Loans
on each Settlement Date applicable thereto;
(d) all accrued and unpaid Interest on the LIBO Rate Loans on the
last day of each Interest Period applicable thereto;
(e) all accrued and unpaid CP Costs on the CP Rate Loans on each
Settlement Date; and
(f) all Broken Funding Costs and Indemnified Amounts upon demand.
SECTION 2.2 COLLECTIONS PRIOR TO AMORTIZATION.
(a) Prior to the Facility Termination Date, any Deemed Collections
received by the Servicer and any other Collections received by the Servicer
shall be set aside and held in trust by the Servicer for the payment of any
accrued and unpaid Obligations or for a Reinvestment as provided in this Section
2.2. If at any time any Collections are received by the Servicer prior to the
Facility Termination Date, Borrower hereby requests and Blue Ridge hereby
agrees, simultaneously with such receipt, that such funds be reinvested by
Borrower in the purchase of additional Eligible Receivables (each, a
"Reinvestment") such that after giving effect to such Reinvestment, the
Aggregate Principal is less than or equal to the Borrowing Limit.
(b) On each Settlement Date prior to the Facility Termination Date,
the Servicer shall remit to the Agent's Account, for distribution to the
Lenders, from the amounts set aside during the preceding Settlement Period a
portion of the Collections equal to the sum of the following amounts for
application to the Obligations in the order specified:
first, ratably to the payment of all accrued and unpaid CP
Costs, Interest and Broken Funding Costs (if any) that are then due and
owing,
second, ratably to the payment of all accrued and unpaid fees
under the Fee Letter (if any) that are then due and owing,
third, to the accrued and unpaid Servicing Fee (so long as the
Servicer is not A.T. Xxxxxx or an Affiliate of A.T. Xxxxxx),
fourth, if required under Section 1.3 or 1.4, to the ratable
reduction of Aggregate Principal,
fifth, for the ratable payment of all other unpaid Obligations,
if any, that are then due and owing,
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sixth, to the accrued and unpaid Servicing Fee (so long as the
Servicer is A.T. Xxxxxx or an Affiliate of A.T. Xxxxxx), and
seventh, the balance, if any, to Borrower or otherwise in
accordance with Borrower's instructions.
Collections applied to the payment of Obligations shall be distributed in
accordance with the aforementioned provisions, and, giving effect to each of the
priorities set forth above in this Section 2.2(a), shall be shared ratably
(within each priority) among the Agent and the Lenders in accordance with the
amount of such Obligations owing to each of them in respect of each such
priority.
SECTION 2.3 COLLECTIONS FOLLOWING AMORTIZATION.
On (i) each day on which any of the conditions precedent set forth in
Section 6.2 are not satisfied, (ii) the Facility Termination Date and (iii) each
day thereafter, the Servicer shall set aside and hold in trust, for the Secured
Parties, all Collections received on such day. On and after the Facility
Termination Date, the Servicer shall, on each Settlement Date and on each other
Business Day specified by the Agent (after deduction of any accrued and unpaid
Servicing Fee as of such date): (A) remit to the Agent's Account the amounts set
aside pursuant to the preceding two sentences, and (B) apply such amounts to
reduce the Obligations as follows:
first, to the reimbursement of the Agent's costs of collection
and enforcement of this Agreement,
second, ratably to the payment of all accrued and unpaid CP
Costs, Interest and Broken Funding Costs,
third, ratably to the payment of all accrued and unpaid fees
under the Fee Letter,
fourth, to the ratable reduction of Aggregate Principal,
fifth, for the ratable payment of all other unpaid Obligations,
and
sixth, after the Obligations have been indefeasibly reduced to
zero, to Borrower.
Collections applied to the payment of Obligations shall be distributed in
accordance with the aforementioned provisions, and, giving effect to each of the
priorities set forth above in this Section 2.3(b), shall be shared ratably
(within each priority) among the Agent and the Lenders in accordance with the
amount of such Obligations owing to each of them in respect of each such
priority.
SECTION 2.4 PAYMENT RESCISSION.
No payment of any of the Obligations shall be considered paid or applied
hereunder to the extent that, at any time, all or any portion of such payment or
application is rescinded by application of law or judicial authority, or must
otherwise be returned or refunded for any reason. Borrower shall remain
obligated for the amount of any payment or application so rescinded,
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returned or refunded, and shall promptly pay to the Agent (for application to
the Person or Persons who suffered such rescission, return or refund) the full
amount thereof, plus Interest on such amount at the Default Rate from the date
of any such rescission, return or refunding.
SECTION 2.5 CALCULATION OF CP COSTS, INTEREST, ETC.
Not later than the 3rd Business Day immediately preceding each Monthly
Reporting Date, the Agent on behalf of the Lenders shall calculate, for the
Calculation Period then most recently ended, the aggregate amount of CP Costs
applicable to all CP Rate Loans for such Calculation Period, the aggregate
amount of Interest applicable to all Liquidity Fundings for such Calculation
Period, the fees payable for such Calculation Period, any Broken Funding Costs
for such Calculation Period, and any other amounts payable hereunder for such
Calculation Period and shall notify Borrower in writing of each such amount on
such day.
ARTICLE III
BLUE RIDGE FUNDING
SECTION 3.1 CP COSTS.
Borrower shall pay CP Costs with respect to the principal balance of
Blue Ridge's Loans from time to time outstanding. Each Loan of Blue Ridge that
is funded with Pooled Commercial Paper will accrue CP Costs each day on a pro
rata basis, based upon the percentage share that the principal in respect of
such Loan represents in relation to all assets held by Blue Ridge and funded
substantially with related Pooled Commercial Paper.
SECTION 3.2 [RESERVED].
SECTION 3.3 CP COSTS PAYMENTS.
On each Settlement Date, Borrower shall pay to the Agent (for the
benefit of Blue Ridge) an aggregate amount equal to all accrued and unpaid CP
Costs in respect of the principal associated with all CP Rate Loans for the
Calculation Period then most recently ended in accordance with Article II.
SECTION 3.4 DEFAULT RATE.
From and after the occurrence of an Amortization Event, all Loans of
Blue Ridge shall accrue Interest at the Default Rate and shall cease to be CP
Rate Loans.
ARTICLE IV
LIQUIDITY BANK FUNDING
SECTION 4.1 LIQUIDITY BANK FUNDING.
Prior to the occurrence of an Amortization Event, the outstanding
principal balance of each Liquidity Funding shall accrue interest for each day
during its Interest Period at either the
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LIBO Rate or the Alternate Base Rate in accordance with the terms and
conditions hereof. Until Borrower gives notice to the Agent of another Interest
Rate in accordance with Section 4.4, the initial Interest Rate for any Loan
transferred to the Liquidity Banks by Blue Ridge pursuant to the Liquidity
Agreement shall be the Alternate Base Rate (unless the Default Rate is then
applicable). If the Liquidity Banks acquire by assignment from Blue Ridge any
Loan pursuant to the Liquidity Agreement, each Loan so assigned shall each be
deemed to have an Interest Period commencing on the date of any such assignment.
SECTION 4.2 INTEREST PAYMENTS.
On the Settlement Date for each Liquidity Funding, Borrower shall pay to
the Agent (for the benefit of the Liquidity Banks) an aggregate amount equal to
the accrued and unpaid Interest for the entire Interest Period of each such
Liquidity Funding in accordance with Article II.
SECTION 4.3 SELECTION AND CONTINUATION OF INTEREST PERIODS.
(a) With consultation from (and approval by) the Agent, Borrower
shall from time to time request Interest Periods for the Liquidity Fundings,
provided that if at any time any Liquidity Funding is outstanding, Borrower
shall always request Interest Periods such that at least one Interest Period
shall end on the date specified in clause (i) of the definition of Settlement
Date.
(b) Borrower or the Agent, upon notice to and consent by the other
received at least three (3) Business Days prior to the end of an Interest Period
(the "Terminating Tranche") for any Liquidity Funding, may, effective on the
last day of the Terminating Tranche: (i) divide any such Liquidity Funding into
multiple Liquidity Fundings, (ii) combine any such Liquidity Funding with one or
more other Liquidity Fundings that have a Terminating Tranche ending on the same
day as such Terminating Tranche or (iii) combine any such Liquidity Funding with
a new Liquidity Funding to be made by the Liquidity Banks on the day such
Terminating Tranche ends.
SECTION 4.4 LIQUIDITY BANK INTEREST RATES.
Borrower may select the LIBO Rate or the Alternate Base Rate for each
Liquidity Funding. Borrower shall by 12:00 noon (New York time): (a) at least
three (3) Business Days prior to the expiration of any Terminating Tranche with
respect to which the LIBO Rate is being requested as a new Interest Rate and (b)
at least one (1) Business Day prior to the expiration of any Terminating Tranche
with respect to which the Alternate Base Rate is being requested as a new
Interest Rate, give the Agent irrevocable notice of the new Interest Rate for
the Liquidity Funding associated with such Terminating Tranche. Until Borrower
gives notice to the Agent of another Interest Rate, the initial Interest Rate
for any Loan transferred to the Liquidity Banks pursuant to the Liquidity
Agreement shall be the Alternate Base Rate (unless the Default Rate is then
applicable).
SECTION 4.5 SUSPENSION OF THE LIBO RATE.
(a) If any Liquidity Bank notifies the Agent that it has determined
that funding its Pro Rata Share of the Liquidity Fundings at a LIBO Rate would
violate any applicable law, rule,
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regulation, or directive of any governmental or regulatory authority, whether or
not having the force of law, or that (i) deposits of a type and maturity
appropriate to match fund its Liquidity Funding at such LIBO Rate are not
available or (ii) such LIBO Rate does not accurately reflect the cost of
acquiring or maintaining a Liquidity Funding at such LIBO Rate, then the Agent
shall suspend the availability of such LIBO Rate and require Borrower to select
the Alternate Base Rate for any Liquidity Funding accruing Interest at such LIBO
Rate.
(b) If either (x) less than all of the Liquidity Banks give a notice
to the Agent pursuant to Section 4.5(a) or (y) any Liquidity Bank has demanded
compensation under Section 10.2, each Liquidity Bank which gave such a notice or
demanded such compensation shall be obliged, at the request of Borrower, Blue
Ridge or the Agent, to assign all of its rights and obligations hereunder to (i)
another Liquidity Bank or (ii) another funding entity nominated by Borrower
(with the approval of the Agent) or the Agent that is an Eligible Assignee
willing to participate in this Agreement through the Liquidity Termination Date
in the place of such notifying Liquidity Bank; provided that (A) the notifying
or demanding Liquidity Bank receives payment in full, pursuant to an Assignment
Agreement, of all Obligations owing to it (whether due or accrued), and (B) the
replacement Liquidity Bank otherwise satisfies the requirements of Section
12.1(b).
SECTION 4.6 DEFAULT RATE.
From and after the occurrence of an Amortization Event, all Liquidity
Fundings shall accrue Interest at the Default Rate.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.1 REPRESENTATIONS AND WARRANTIES OF THE LOAN PARTIES.
Each Loan Party hereby represents and warrants to the Agent and the
Lenders, as to itself, as of the date hereof, as of the date of each Advance, of
each Reinvestment and of each Settlement Date that:
(a) Existence and Power. Such Loan Party's jurisdiction of
organization is correctly set forth in the preamble to this Agreement. Such Loan
Party is duly organized under the laws of that jurisdiction and no other state
or jurisdiction, and such jurisdiction must maintain a public record showing the
organization to have been organized. Such Loan Party is validly existing and in
good standing under the laws of its state of organization. Such Loan Party is
duly qualified to do business and is in good standing as a foreign entity, 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 Loan Party of this Agreement and each other
Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder and, in the case of Borrower, Borrower's
use of the proceeds of Advances made hereunder, are within its
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corporate powers and authority and have been duly authorized by all necessary
corporate action on its part. This Agreement and each other Transaction Document
to which such Loan Party is a party has been duly executed and delivered by such
Loan Party.
(c) No Conflict. The execution and delivery by such Loan Party of
this 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 certificate or articles of incorporation or by-laws, (ii) any
law, rule or regulation applicable to it, (iii) any restrictions under 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 Loan Party or its
Subsidiaries (except as created hereunder) 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 Loan
Party of this Agreement and each other Transaction Document to which it is a
party and the performance of its obligations hereunder and thereunder.
(e) Actions, Suits. (i) With respect to the initial Servicer, there
are no actions, suits or proceedings pending, or to such knowledge, threatened,
against or affecting it, or any of its properties, in or before any court,
arbitrator or other body, that, if adversely determined, could reasonably be
expected to have a material adverse effect on (A) the financial condition or
operations of the initial Servicer and its Subsidiaries, taken as a whole, which
could reasonably be expected to have a material adverse effect on the ability of
the initial Servicer to perform its obligations under this Agreement, (B) the
legality, validity or enforceability of this Agreement or any other Transaction
Document, (C) the Agent's security interest, for the benefit of the Secured
Parties, in the Receivables generally or in any significant portion of the
Receivables, the Related Security or the Collections with respect thereto, or
(D) the collectibility of the Receivables generally or of any material portion
of the Receivables and (ii) with respect to Borrower, there are no actions,
suits or proceedings pending, or to such knowledge, threatened, against or
affecting it, or any of its properties, in or before any court, arbitrator or
other body, that, if adversely determined, could reasonably be expected to have
a Material Adverse Effect. Such Loan Party 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 Loan Party is a party constitute the legal, valid and
binding obligations of such Loan Party enforceable against such Loan Party 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).
10
(g) Accuracy of Information, etc. All information, certifications or
statements (but excluding any such information, certification or statement or
portion thereof containing financial projections or other forward looking
statements) heretofore furnished or made by such Loan Party or any of its
Affiliates to the Agent or the Lenders 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, certifications or
statements (but excluding any such information, certification or statement or
portion thereof containing financial projections or other forward looking
statements) hereafter furnished or made by such Loan Party or any of its
Affiliates to the Agent or the Lenders 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 misstatement of material fact or omit to state a
material fact necessary in order to make the statements contained therein, in
light of the circumstances under which they were made, not misleading.
(h) Use of Proceeds. No proceeds of any Advance hereunder will be
used (i) for a purpose that violates, or would be inconsistent with, (A) Section
7.2(e) of this Agreement or (B) 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. Borrower is 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. There have been
duly filed all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect Borrower's ownership interest in each Receivable, its Collections and
the Related Security.
(j) Perfection. This Agreement is effective to create a valid
security interest in favor of the Agent for the benefit of the Secured Parties
in the Collateral to secure payment of the Obligations, free and clear of any
Adverse Claim except as created by the Transactions Documents. There have been
duly filed all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect the Agent's (on behalf of the Secured Parties) security interest in
the Collateral. Such Loan Party's jurisdiction of organization is a jurisdiction
whose law generally requires information concerning the existence of a
nonpossessory security interest to be made generally available in a filing,
record or registration system as a condition or result of such a security
interest's obtaining priority over the rights of a lien creditor which respect
to collateral.
(k) Places of Business and Locations of Records. The principal
places of business and chief executive office of such Loan Party and the offices
where it keeps all of its Records are located at the address(es) listed on
Exhibit III or such other locations of which the Agent has been notified in
accordance with Section 7.2(a) in jurisdictions where all action required by
Section 14.4(a) has been taken and completed. Borrower's Federal Employer
Identification Number is correctly set forth on Exhibit III.
(l) Collections. The conditions and requirements set forth in
Section 7.1(j) and Section 8.2 have at all times been satisfied and duly
performed. The names, addresses and jurisdictions of organization of all
Collection Banks, together with the account numbers of the
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Collection Accounts of Borrower at each Collection Bank and the post office box
number of each Lock-Box, are listed on Exhibit IV. Borrower has not granted any
Person, other than the Agent as contemplated by this Agreement, dominion and
control of any Lock-Box or Collection Account, or the right to take dominion and
control of any such Lock-Box or Collection Account at a future time or upon the
occurrence of a future event.
(m) Material Adverse Effect. (i) The initial Servicer represents and
warrants that since October 31, 2001, no event has occurred that would have a
material adverse effect on the financial condition or operations of the initial
Servicer and its Subsidiaries or the ability of the initial Servicer to perform
its obligations under this Agreement, and (ii) Borrower represents and warrants
that since the date of this Agreement, no event has occurred that would have a
material adverse effect on (A) the financial condition or operations of
Borrower, (B) the ability of Borrower to perform its obligations under the
Transaction Documents, or (C) the collectibility of the Receivables generally or
any material portion of the Receivables.
(n) Names. The name in which Borrower has executed this Agreement is
identical to the name of Borrower as indicated on the public record of its state
of organization which shows Borrower to have been organized. In the past five
(5) years, Borrower has not used any corporate names, trade names or assumed
names other than the name in which it has executed this Agreement.
(o) Ownership of Borrower. Xxxxxx Coal Sales Company, Inc. owns,
directly or indirectly, 100% of the issued and outstanding capital stock of
Borrower, free and clear of any Adverse Claim. Such capital stock is validly
issued, fully paid and nonassessable, and there are no options, warrants or
other rights to acquire securities of Borrower.
(p) Not a Holding Company or an Investment Company. Such Loan Party
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 Loan Party 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 Loan Party 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. Each Receivable, together with the Contract 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 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. Such Loan Party
has complied in all material respects with the Credit and Collection Policy with
regard to each Receivable and the related Contract, and has not made any change
to such Credit and Collection Policy, except such change as to which the
requirements of Section 7.1(a)(vii) have been satisfied.
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(s) Payments to Applicable Originator. With respect to each
Receivable transferred to Borrower under the Receivables Sale Agreement,
Borrower has given reasonably equivalent value to the applicable Originator in
consideration therefor and such transfer was not made for or on account of an
antecedent debt. No transfer by any Originator of any Receivable under the
Receivables Sale Agreement is or may be voidable under any section of the
Bankruptcy Reform Act of 1978 (11 U.S.C. Sections 101 et seq.), as amended.
(t) Enforceability of Contracts. Each Contract with respect to each
Receivable 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 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) Eligible Receivables. Each Receivable included in the Net Pool
Balance as an Eligible Receivable on any date was an Eligible Receivable on such
date.
(v) Borrowing Limit. Immediately after giving effect to each
Advance, each Reinvestment and each settlement on any Settlement Date hereunder,
the Aggregate Principal is less than or equal to the Borrowing Limit.
(w) Accounting. The manner in which such Loan Party accounts for the
transactions contemplated by this Agreement and the Receivables Sale Agreement
does not jeopardize the true sale analysis.
ARTICLE VI
CONDITIONS OF ADVANCES
SECTION 6.1 CONDITIONS PRECEDENT TO INITIAL ADVANCE.
The initial Advance under this Agreement is subject to the conditions
precedent that (a) the Agent shall have received on or before the date of such
Advance those documents listed on Schedule A to the Receivables Sale Agreement
and those documents listed on Schedule B to this Agreement, and (b) the Agent
shall have received all fees and expenses required to be paid on such date
pursuant to the terms of this Agreement and the Fee Letter.
SECTION 6.2 CONDITIONS PRECEDENT TO ALL ADVANCES AND REINVESTMENTS.
Each Advance, each Reinvestment and each rollover or continuation of any
Advance shall be subject to the further conditions precedent that (a) the
Servicer shall have delivered to the Agent on or prior to the date thereof, in
form and substance satisfactory to the Agent, all Monthly Reports as and when
due under Section 8.5; (b) the Facility Termination Date shall not have
occurred; (c) the Agent shall have received such other approvals, opinions or
documents as it may reasonably request; and (d) on the date thereof, the
following statements shall be true (and acceptance of the proceeds of such
Advance or Reinvestment shall be deemed a representation and warranty by
Borrower that such statements are then true):
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(i) the representations and warranties set forth in Section
5.1 are true and correct on and as of the date of such Advance (or such
Settlement Date, as the case may be) such Reinvestment or rollover or
continuation of any Advance as though made on and as of such date;
(ii) no event has occurred and is continuing, or would result
from such Advance (or the continuation thereof), that will constitute an
Amortization Event, and no event has occurred and is continuing, or
would result from such Advance (or the continuation thereof) such
Reinvestment or rollover or continuation of any Advance, that would
constitute an Unmatured Amortization Event; and
(iii) after giving effect to such Advance such Reinvestment or
rollover or continuation of any Advance, the Aggregate Principal will
not exceed the Borrowing Limit.
ARTICLE VII
COVENANTS
SECTION 7.1 AFFIRMATIVE COVENANTS OF THE LOAN PARTIES.
Until the Final Payout date, each Loan Party hereby covenants, as to
itself, as set forth below:
(a) Financial Reporting. Such Loan Party will maintain, for itself
and each of its Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish or cause to be furnished to
the Agent:
(i) Annual Reporting. (A) Within 100 days after the close of
each of Borrower's respective fiscal years, financial statements (which
shall include balance sheets, statements of income and retained earnings
and a statement of cash flows) for Borrower and its consolidated
subsidiaries for such fiscal year certified in a manner acceptable to
the Agent by Borrower's chairman and chief financial officer and (B)
within 100 days after the close of each of its respective fiscal years,
audited, unqualified financial statements (which shall include balance
sheets, statements of income and retained earnings and a statement of
cash flows) for the Performance Guarantor and its consolidated
subsidiaries for such fiscal year certified in a manner acceptable to
the Agent by independent public accountants reasonably acceptable to the
Agent.
(ii) Quarterly Reporting. (A) Within 55 days after the close
of the first three (3) quarterly periods of each of Borrower's
respective fiscal years, balance sheets of Borrower and its consolidated
subsidiaries as at the close of each such period and statements of
income and retained earnings and a statement of cash flows for Borrower
for the period from the beginning of such fiscal year to the end of such
quarter, all certified by its chief financial officer and (B) within 55
days after the close of the first three (3) quarterly periods of each of
its respective fiscal years, balance sheets of each of the Performance
Guarantor and its consolidated subsidiaries as at the close of each such
period and statements of income and retained earnings and a statement of
cash flows for
14
such Person for the period from the beginning of such fiscal year to the
end of such quarter, all certified by its respective chief financial
officer.
(iii) Compliance Certificate. Together with the financial
statements required hereunder, a compliance certificate in substantially
the form of Exhibit V signed by Borrower's or the Performance
Guarantor's Authorized Officer, as applicable, and dated the date of
such annual financial statement or such quarterly financial statement,
as the case may be.
(iv) Shareholders Statements and Reports. Promptly upon the
furnishing thereof to the shareholders of the Performance Guarantor
copies of all financial statements, reports and proxy statements so
furnished.
(v) S.E.C. Filings. Promptly upon the filing thereof, copies
of all registration statements (other than any exhibits thereto and any
registration statements on Form S-8 or its equivalent) and annual,
quarterly, monthly or other regular reports which the Performance
Guarantor or any of its Affiliates files with the Securities and
Exchange Commission or any national securities exchange unless the
Performance Guarantor is not permitted by applicable law, rule or
regulation to provide copies to the Agent.
(vi) Copies of Notices. Promptly upon its receipt of any
notice, request for consent, financial statements, certification, report
or other communication under or in connection with any Transaction
Document from any Person other than the Agent or any Lender, copies of
the same.
(vii) Change in Credit and Collection Policy. At least thirty
(30) days prior to the effectiveness of any change in or amendment to
the Credit and Collection Policy, a copy of the Credit and Collection
Policy then in effect and a notice (A) indicating such change or
amendment, and (B) if such proposed change or amendment would be
reasonably likely to adversely affect the collectibility of the
Receivables or decrease the credit quality of any newly created
Receivables, requesting the Agent's consent thereto.
(viii) Other Information. Promptly, from time to time, such
other information, documents, records or reports relating to the
Receivables or the condition or operations, financial or otherwise, of
such Loan Party as the Agent may from time to time reasonably request in
order to protect the interests of the Agent and the Lenders under or as
contemplated by this Agreement.
(b) Notices. Such Loan Party will notify the Agent 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) Amortization Events or Unmatured Amortization Events.
The occurrence of each Amortization Event and each Unmatured
Amortization Event, by a statement of an Authorized Officer of such Loan
Party.
(ii) Judgments and Proceedings. (A) The entry of any judgment
or decree or the institution of any litigation, arbitration proceeding
or governmental proceeding
15
against Borrower or (B) the commencement of all actions, suits and
proceedings before any domestic or foreign Governmental Authority or
arbitrator, affecting the Performance Guarantor, any Loan Party or any
of their respective Subsidiaries that (i) seeks injunctive or similar
relief or (ii) in the reasonable judgment of the Performance Guarantor,
such Loan Party or such Subsidiary, exposes such Person to liability
(other than Environmental Liabilities and Costs) in an amount
aggregating $5,000,000 or more for any group of such actions, suits and
proceedings arising from any single event or series of related events or
that, if adversely determined, could reasonably be expected to have a
Material Adverse Effect and the occurrence of any of the following:
(A) that the Performance Guarantor or any Loan Party
is or may be liable to any Person as a result of a Release or
threatened Release that could reasonably be expected to subject
the Loan Parties collectively to Environmental Liabilities and
Costs of $10,000,000 or more prior to the Termination Date;
(B) the receipt by the Performance Guarantor or any
Loan Party of notification that any real or personal property of
such Person is subject to any Environmental Lien, or the
discovery of action by a Governmental Authority that is
reasonably expected to result in an Environmental Lien, that
could take preference or priority over any lien in favor of the
Agent securing the Obligations;
(C) the receipt by the Performance Guarantor or any
Loan Party of any notice of violation of or potential liability
under, or knowledge by such Person that there exists a condition
that could reasonably be expected to result in a violation of or
liability under, any Environmental Law (except reclamation
requirements under the Surface Mining Control and Reclamation
Act), except for violations and liabilities the consequence of
which, in the aggregate, would not be reasonably likely to
subject such Persons collectively to Environmental Liabilities
and Costs of $10,000,000 or more;
(D) the commencement of any judicial or
administrative proceeding or investigation alleging a violation
of or liability under any Environmental Law, that, if adversely
determined, would have a reasonable likelihood of subjecting the
Performance Guarantor or any Loan Party collectively to
Environmental Liabilities and Costs of $10,000,000 or more prior
to the Termination Date for any group of such judicial or
administrative proceedings or investigations arising from any
single event or series of related events; and
(E) any proposed action by the Performance Guarantor
or any Loan Party or any of their respective Subsidiaries or any
proposed change in Environmental Laws that has a reasonable
likelihood of requiring such Person to obtain additional
environmental, health or safety Permits or make additional
capital improvements to obtain compliance with Environmental
Laws that would cost $5,000,000 or more or subject the
Performance Guarantor or any Loan Party to additional
Environmental Liabilities and Costs of $5,000,000 or more prior
to the Facility Termination Date.
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(iii) Material Adverse Effect. The occurrence of any event or
condition that has had, or could reasonably be expected to have, a
Material Adverse Effect.
(iv) Termination Date. The occurrence of the "Termination
Date" under and as defined in the Receivables Sale Agreement.
(v) Defaults Under Other Agreements. The occurrence of an
event of default under any other financing arrangement pursuant to which
such Loan Party is a debtor or an obligor.
(vi) Notices under Receivables Sale Agreement. Copies of all
notices delivered under the Receivables Sale Agreement.
(vii) Downgrade of Servicer or Performance Guarantor. Any
downgrade in the rating of any Indebtedness of the Servicer or of the
Performance Guarantor by S&P or Xxxxx'x, setting forth the Indebtedness
affected and the nature of such change; provided, that any notice under
this clause (vii) need not be made in writing if made by telephone to an
appropriate officer of the Agent.
(c) Compliance with Laws and Preservation of Corporate Existence.
Such Loan Party 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 Loan Party will 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 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; provided, that
nothing in this Section 7.1(c) shall prevent (i) any Loan Party (other than
Borrower) from merging into, consolidating with, or selling, leasing or
otherwise transferring all of its assets to a Subsidiary or into, with or to any
Person in a transaction permitted by Section 5.04(d) or Section 5.04(g) of the
Credit Agreements; provided, that (x) the Performance Guarantor shall have
agreed in writing, prior to or simultaneously with, such action, that such
action will have no effect on the obligations of the Performance Guarantor under
the Performance Undertaking with respect to the affected Person, (y) if such
Loan Party is not the surviving entity in any such merger or consolidation, both
(A) the successor entity assumes all of the Servicer's duties and obligations
under this Agreement and (B) the Performance Guarantor shall have agreed in
writing, prior to or simultaneously with, such action, that the obligations of
such Person shall be covered by the Performance Guarantor under the Performance
Undertaking and (z) the Agent shall have received each of the following: (A) at
least thirty (30) days' prior written notice thereof, (B) at least ten (10) days
prior to such merger, consolidation, sale, lease, or transfer, all financing
statements, instruments and other documents requested by the Agent in connection
with such merger, consolidation, sale, lease, or transfer and (C) an opinion of
Hunton & Xxxxxxxx or such other counsel acceptable to Agent and its assigns to
the effect that such assumption agreement is the legal, valid, binding and
enforceable obligation of such Person and that the Agent's security interest
(for the benefit of the Secured Parties) is perfected and of first priority,
such opinion to be in form and substance acceptable to Agent and its assigns or
(ii) any Loan Party (other than Borrower) from abandoning or disposing of any of
its property (other
17
than any Receivable or any Related Security) or abandoning or terminating any
right or franchise if such (x) abandonment, disposition or termination does not
violate any other provision of this Agreement and (y) all such abandonments,
dispositions and terminations do not in the aggregate have a Material Adverse
Effect.
(d) Audits. Such Loan Party will furnish to the Agent from time to
time such information with respect to it and the Receivables as the Agent may
reasonably request. Such Loan Party will, from time to time during regular
business hours as requested by the Agent upon reasonable notice and at the sole
cost of such Loan Party, permit the Agent, or its agents or representatives (and
shall cause each Originator to permit the Agent or its agents or
representatives): (i) to examine and make copies of and abstracts from all
Records in the possession or under the control of such Person relating to the
Collateral, including, without limitation, the related Contracts, and (ii) to
visit the offices and properties of such Person for the purpose of examining
such materials described in clause (i) above, and to discuss matters relating to
such Person's financial condition or the Collateral or any Person's performance
under any of the Transaction Documents or any Person's performance under the
Contracts and, in each case, with any of the officers or employees of Borrower
or the Servicer having knowledge of such matters (each of the foregoing
examinations and visits, a "Review"); provided, however, that, so long as no
Amortization Event has occurred and is continuing, (A) excluding the first
Review after the Closing Date, the Loan Parties shall only be responsible for
the costs and expenses of one (1) Review in any one calendar year, and (B) the
Agent will not request more than two (2) Reviews in any one calendar year;
provided, further, however, that the Loan Parties shall also be responsible for
the costs and expenses of one (1) Review to occur within the first ninety (90)
days after the Closing Date, which Review shall not be considered one of the two
(2) Reviews that may be requested by the Agent under subclause (B) above for
calendar year 2003.
(e) Keeping and Marking of Records and Books.
(i) The Servicer will (and will cause each Originator to)
maintain and implement administrative and operating procedures
(including, without limitation, an ability to recreate records
evidencing Receivables in the event of the destruction of the originals
thereof), and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit
the immediate identification of each new Receivable and all Collections
of and adjustments to each existing Receivable). The Servicer will (and
will cause each Originator to) give the Agent notice of any material
change in the administrative and operating procedures referred to in the
previous sentence.
(ii) Such Loan Party will (and will cause each Originator
to): (A) on or prior to the date hereof, xxxx its master data processing
records and other books and records relating to the Loans with a legend,
acceptable to the Agent, describing the Agent's security interest in the
Collateral and (B) upon the request of the Agent, after the occurrence
of an Amortization Event: (1) xxxx each Contract with a legend
describing the Agent's security interest and (2) deliver to the Agent
all Contracts (including, without limitation, all multiple originals of
any such Contract constituting an instrument, a certificated security or
chattel paper) relating to the Receivables.
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(f) Compliance with Contracts and Credit and Collection Policy. Such
Loan Party will (and will cause each Originator to) timely and fully (i) perform
and comply with all provisions, covenants and other promises required to be
observed by it under the Contracts related to the Receivables, and (ii) comply
in all respects with the Credit and Collection Policy in regard to each
Receivable and the related Contract, except to the extent that any failure to so
perform or comply could not reasonably be expected to have a Material Adverse
Effect.
(g) Performance and Enforcement of Receivables Sale Agreement.
Borrower (i) will, and will require each Originator to, perform each of their
respective obligations and undertakings under and pursuant to the Receivables
Sale Agreement, (ii) will purchase Receivables thereunder in strict compliance
with the terms thereof and (iii) will vigorously enforce the rights and remedies
accorded to Borrower under the Receivables Sale Agreement. Borrower will take
all actions to perfect and enforce its rights and interests (and the rights and
interests of the Agent and the Lenders as assignees of Borrower) under the
Receivables Sale Agreement as the Agent may from time to time reasonably
request, including, without limitation, making claims to which it may be
entitled under any indemnity, reimbursement or similar provision contained in
the Receivables Sale Agreement.
(h) Ownership. Borrower will (or will cause each Originator to) take
all necessary action to (i) vest legal and equitable title to the Collateral
purchased under the Receivables Sale Agreement irrevocably in Borrower, free and
clear of any Adverse Claims (other than Adverse Claims in favor of the Agent,
for the benefit of the Secured Parties) 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 Borrower's interest in such Collateral and such other action to
perfect, protect or more fully evidence the interest of Borrower therein as the
Agent may reasonably request), and (ii) establish and maintain, in favor of the
Agent, for the benefit of the Secured Parties, a valid and perfected first
priority security interest in all Collateral, free and clear of any Adverse
Claims, 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 the Agent's (for the
benefit of the Secured Parties) security interest in the Collateral and such
other action to perfect, protect or more fully evidence the interest of the
Agent for the benefit of the Secured Parties as the Agent may reasonably
request.
(i) Lenders' Reliance. Borrower acknowledges that the Lenders are
entering into the transactions contemplated by this Agreement in reliance upon
Borrower's identity as a legal entity that is separate from each Originator.
Therefore, from and after the date of execution and delivery of this Agreement,
Borrower shall take all reasonable steps, including, without limitation, all
steps that the Agent or any Lender may from time to time reasonably request, to
maintain Borrower's identity as a separate legal entity and to make it manifest
to third parties that Borrower is an entity with assets and liabilities distinct
from those of each Originator and any Affiliates thereof (other than Borrower)
and not just a division of any Originator or any such Affiliate. Without
limiting the generality of the foregoing and in addition to the other covenants
set forth herein, Borrower will:
(i) conduct its own business in its own name and require
that all full-time employees of Borrower, if any, identify themselves as
such and not as employees of any
19
Originator (including, without limitation, by means of providing
appropriate employees with business or identification cards identifying
such employees as Borrower's employees);
(ii) compensate all employees, consultants and agents
directly, from Borrower's own funds, for services provided to Borrower
by such employees, consultants and agents and, to the extent any
employee, consultant or agent of Borrower is also an employee,
consultant or agent of any Originator or any Affiliate thereof, allocate
the compensation of such employee, consultant or agent between Borrower
and such Originator or such Affiliate, as applicable, on a basis that
reflects the services rendered to Borrower and such Originator or such
Affiliate, as applicable;
(iii) clearly identify its offices (by signage or otherwise)
as its offices and, if such office is located in the offices of any
Originator, Borrower shall lease such office at a fair market rent;
(iv) have a separate telephone number, which will be answered
only in its name and separate stationery and checks in its own name;
(v) conduct all transactions with each Originator and the
Servicer (including, without limitation, any delegation of its
obligations hereunder as Servicer) strictly on an arm's-length basis,
allocate all overhead expenses (including, without limitation, telephone
and other utility charges) for items shared between Borrower and such
Originator on the basis of actual use to the extent practicable and, to
the extent such allocation is not practicable, on a basis reasonably
related to actual use;
(vi) at all times have a Board of Directors consisting of
three members, at least one member of which is an Independent Director;
(vii) observe all corporate formalities as a distinct entity,
and ensure that all corporate actions relating to (A) the selection,
maintenance or replacement of the Independent Director, (B) the
dissolution or liquidation of Borrower or (C) the initiation of,
participation in, acquiescence in or consent to any bankruptcy,
insolvency, reorganization or similar proceeding involving Borrower, are
duly authorized by unanimous vote of its Board of Directors (including
the Independent Director);
(viii) maintain Borrower's books and records separate from
those of each Originator and any Affiliate thereof and otherwise readily
identifiable as its own assets rather than assets of any Originator or
any Affiliate thereof;
(ix) prepare its financial statements separately from those
of each Originator and insure that any consolidated financial statements
of any Originator or any Affiliate thereof that include Borrower and
that are filed with the Securities and Exchange Commission or any other
governmental agency have notes clearly stating that Borrower is a
separate corporate entity and that its assets will be available first
and foremost to satisfy the claims of the creditors of Borrower;
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(x) except as herein specifically otherwise provided,
maintain the funds or other assets of Borrower separate from, and not
commingled with, those of any Originator or any Affiliate thereof and
only maintain bank accounts or other depository accounts to which
Borrower alone is the account party, into which Borrower alone makes
deposits and from which Borrower alone (or the Agent hereunder) has the
power to make withdrawals;
(xi) pay all of Borrower's operating expenses from Borrower's
own assets (except for certain payments by any Originator or other
Persons pursuant to allocation arrangements that comply with the
requirements of this Section 7.1(i));
(xii) operate its business and activities such that: it does
not engage in any business or activity of any kind, or enter into any
transaction or indenture, mortgage, instrument, agreement, contract,
lease or other undertaking, other than the transactions contemplated and
authorized by this Agreement and the Receivables Sale Agreement; and
does not create, incur, guarantee, assume or suffer to exist any
indebtedness or other liabilities, whether direct or contingent, other
than (A) as a result of the endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business, (B) the incurrence of obligations under this Agreement, (C)
the incurrence of obligations, as expressly contemplated in the
Receivables Sale Agreement, to make payment to the applicable Originator
thereunder for the purchase of Receivables from such Originator under
the Receivables Sale Agreement, and (D) the incurrence of operating
expenses in the ordinary course of business of the type otherwise
contemplated by this Agreement;
(xiii) maintain its corporate charter in conformity with this
Agreement, such that it does not amend, restate, supplement or otherwise
modify its Certificate of Incorporation or By-Laws in any respect that
would impair its ability to comply with the terms or provisions of any
of the Transaction Documents, including, without limitation, Section
7.1(i) of this Agreement;
(xiv) maintain the effectiveness of, and continue to perform
under the Receivables Sale Agreement and the Performance Undertaking,
such that it does not amend, restate, supplement, cancel, terminate or
otherwise modify the Receivables Sale Agreement or the Performance
Undertaking, or give any consent, waiver, directive or approval
thereunder or waive any default, action, omission or breach under the
Receivables Sale Agreement or the Performance Undertaking or otherwise
grant any indulgence thereunder, without (in each case) the prior
written consent of the Agent;
(xv) maintain its corporate separateness such that it does
not merge or consolidate with or into, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions, and except as otherwise contemplated herein) all or
substantially all of its assets (whether now owned or hereafter
acquired) to, or acquire all or substantially all of the assets of, any
Person, nor at any time create, have, acquire, maintain or hold any
interest in any Subsidiary.
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(xvi) maintain at all times the Required Capital Amount and
refrain from making any dividend, distribution, redemption of capital
stock or payment of any subordinated indebtedness which would cause the
Required Capital Amount to cease to be so maintained; and
(xvii) take such other actions as are necessary on its part to
ensure that the facts and assumptions set forth in the opinion issued by
Hunton & Xxxxxxxx, as counsel for Borrower, in connection with the
closing or initial Advance under this Agreement and relating to
substantive consolidation issues, and in the certificates accompanying
such opinion, remain true and correct in all material respects at all
times.
(j) Collections.
(i) Such Loan Party will cause (A) all proceeds from all
Lock-Boxes to be directly deposited by a Collection Bank into a
Collection Account and (B) each Lock-Box and Collection Account to be
subject at all times to a Collection Account Agreement that is in full
force and effect. In the event any payments relating to the Collateral
are remitted directly to Borrower or any Affiliate of Borrower, Borrower
will remit (or will cause all such payments to be remitted) directly to
a Collection Bank and deposited into a Collection Account within two (2)
Business Days following receipt thereof, and, at all times prior to such
remittance, Borrower will itself hold or, if applicable, will cause such
payments to be held in trust for the exclusive benefit of the Agent and
the Lenders. Borrower will maintain exclusive ownership, dominion and
control (subject to the terms of this Agreement) of each Lock-Box and
Collection Account and shall not grant the right to take dominion and
control of any Lock-Box or Collection Account at a future time or upon
the occurrence of a future event to any Person, except to the Agent as
contemplated by this Agreement.
(ii) Borrower, or Servicer on behalf of Borrower, shall cause
evidence to be delivered to Agent showing that each Lock-Box and each
Collection Account is maintained in the name of Borrower.
(k) Taxes. Such Loan Party will pay, and will cause each Subsidiary
to pay, before the same become delinquent, all taxes, assessments and
governmental charges imposed upon it or any of its properties, except where the
same may be contested in good faith by appropriate proceedings, or where any
failure to so pay could not reasonably be expected to have a Material Adverse
Effect, and each such Loan Party will maintain, and will cause each Subsidiary
to maintain, in accordance with GAAP, appropriate reserves for the accrual of
the same. Borrower will pay when due any taxes payable in connection with the
Receivables, exclusive of taxes on or measured by income or gross receipts of
the Agent or any Lender.
(l) Payment to Applicable Originator. With respect to any Receivable
purchased by Borrower from any Originator, such sale shall be effected under,
and in strict compliance with the terms of, the Receivables Sale Agreement,
including, without limitation, the terms relating to the amount and timing of
payments to be made to such Originator in respect of the purchase price for such
Receivable.
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SECTION 7.2 NEGATIVE COVENANTS OF THE LOAN PARTIES.
Until the Final Payout Date, each Loan Party (or, if specified, solely
Borrower) hereby covenants, as to itself, that:
(a) Name Change, Offices and Records. Such Loan Party will not
change (i) its name as it appears in official filings in the jurisdiction of its
organization, (ii) its status as a "registered organization" (within the meaning
of Article 9 of any applicable enactment of the UCC), (iii) its organizational
identification number, if any, issued by its jurisdiction of organization, or
(iv) its jurisdiction of organization unless it shall have: (A) given the Agent
at least thirty (30) days' prior written notice thereof; (B) at least ten (10)
days prior to such change, delivered to the Agent all financing statements,
instruments and other documents requested by the Agent in connection with such
change or relocation and (C) caused an opinion of Hunton & Xxxxxxxx or such
other counsel acceptable to Agent and its assigns to be delivered to Agent and
its assigns that Agent's security interest (for the benefit of the Secured
Parties) is perfected and of first priority, such opinion to be in form and
substance acceptable to Agent and its assigns.
(b) Change in Payment Instructions to Obligors. Except as may be
required by the Agent pursuant to Section 8.2(b), such Loan Party will not add
or terminate any bank as a Collection Bank, or make any change in the
instructions to Obligors regarding payments to be made to any Lock-Box or
Collection Account, unless the Agent 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 payments if such new instructions require such Obligor to
make payments to another existing Collection Account.
(c) Modifications to Contracts and Credit and Collection Policy.
Such Loan Party will not, and will not permit any Originator to, make any change
to the Credit and Collection Policy that could adversely affect the
collectibility of the Receivables or decrease the credit quality of any newly
created Receivables. Except as provided in Section 8.2(d), the Servicer will
not, and will not permit any Originator to, extend, amend or otherwise modify
the terms of any Receivable or any Contract related thereto other than in
accordance with the Credit and Collection Policy.
(d) Sales, Liens. Borrower will not 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 of
the Collateral, or assign any right to receive income with respect thereto
(other than, in each case, the creation of a security interest therein in favor
of the Agent as provided for herein), and Borrower will defend the right, title
and interest of the Secured Parties in, to and under any of the foregoing
property, against all claims of third parties claiming through or under Borrower
or any Originator. Borrower will not create or suffer to exist any mortgage,
pledge, security interest, encumbrance, lien, charge or other similar
arrangement on any of its assets.
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(e) Use of Proceeds. Borrower will not use the proceeds of the
Advances for any purpose other than (i) paying for Receivables and Related
Security under and in accordance with the Receivables Sale Agreement, including
without limitation, making payments on the Subordinated Notes to the extent
permitted thereunder and under the Receivables Sale Agreement, (ii) paying its
ordinary and necessary operating expenses when and as due, and (iii) making
Restricted Junior Payments to the extent permitted under this Agreement.
(f) Termination Date Determination. Borrower will not designate the
Termination Date, or send any written notice to any Originator in respect
thereof, without the prior written consent of the Agent, except with respect to
the occurrence of such Termination Date arising pursuant to Section 5.1(d) of
the Receivables Sale Agreement.
(g) Restricted Junior Payments. Borrower will not make any
Restricted Junior Payment if after giving effect thereto, Borrower's Net Worth
would be less than the Required Capital Amount.
(h) Borrower Indebtedness. Borrower will not incur or permit to
exist any Indebtedness or liability on account of deposits except: (i) the
Obligations and (ii) other current accounts payable arising in the ordinary
course of business and not overdue.
(i) Prohibition on Additional Negative Pledges. No Loan Party will
enter into or assume any agreement (other than this Agreement and the other
Transaction Documents) prohibiting the creation or assumption of any Adverse
Claim upon the Collateral except as contemplated by the Transaction Documents,
or otherwise prohibiting or restricting any transaction contemplated hereby or
by the other Transaction Documents.
(j) Intercreditor Agreement. It will take no action in violation of
any provision of the Intercreditor Agreement or fail to take any action that
could be reasonably expected to result in a violation of any provision of the
Intercreditor Agreement.
ARTICLE VIII
ADMINISTRATION AND COLLECTION
SECTION 8.1 DESIGNATION OF SERVICER.
(a) The servicing, administration and collection of the Receivables
shall be conducted by such Person (the "Servicer") so designated from time to
time in accordance with this Section 8.1. A.T. Xxxxxx is hereby designated as,
and hereby agrees to perform the duties and obligations of, the Servicer
pursuant to the terms of this Agreement. The Agent may at any time after the
occurrence of an Amortization Event designate as Servicer any Person to succeed
A.T. Xxxxxx or any successor Servicer provided that the Rating Agency Condition
is satisfied.
(b) A.T. Xxxxxx may delegate, and A.T. Xxxxxx hereby advises the
Lenders and the Agent that it has delegated, to the Originators, as
sub-servicers of the Servicer, certain of its duties and responsibilities as
Servicer hereunder in respect of the Receivables originated by such Originator.
Without the prior written consent of the Agent and the Required Liquidity Banks,
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A.T. Xxxxxx shall not be permitted to delegate any of its duties or
responsibilities as Servicer to any Person other than (i) Borrower, (ii) the
Originators, and (iii) with respect to certain Defaulted Receivables, outside
collection agencies in accordance with its customary practices. Neither Borrower
nor any Originator shall be permitted to further delegate to any other Person
any of the duties or responsibilities of the Servicer delegated to it by A.T.
Xxxxxx. If at any time the Agent shall designate as Servicer any Person other
than A.T. Xxxxxx, all duties and responsibilities theretofore delegated by A.T.
Xxxxxx to Borrower or the Originators may, at the discretion of the Agent, be
terminated forthwith on notice given by the Agent to A.T. Xxxxxx and to Borrower
and the Originators.
(c) Notwithstanding the foregoing subsection (b): (i) A.T. Xxxxxx
shall be and remain primarily liable to the Agent and the Lenders for the full
and prompt performance of all duties and responsibilities of the Servicer
hereunder and (ii) the Agent and the Lenders shall be entitled to deal
exclusively with A.T. Xxxxxx in matters relating to the discharge by the
Servicer of its duties and responsibilities hereunder. The Agent and the Lenders
shall not be required to give notice, demand or other communication to any
Person other than A.T. Xxxxxx in order for communication to the Servicer and its
sub-servicer or other delegate with respect thereto to be accomplished. A.T.
Xxxxxx, at all times that it is the Servicer, shall be responsible for providing
any sub-servicer or other delegate of the Servicer with any notice given to the
Servicer under this Agreement.
SECTION 8.2 DUTIES OF SERVICER.
(a) The Servicer shall take or cause to be taken all such actions as
may be necessary or advisable to collect each Receivable from time to time, all
in accordance with applicable laws, rules and regulations, with reasonable care
and diligence, and in accordance with the Credit and Collection Policy.
(b) The Servicer will instruct all Obligors to pay all Collections
directly to a Lock-Box or Collection Account. The Servicer shall effect a
Collection Account Agreement substantially in the form of Exhibit VI with each
bank party to a Collection Account at any time. In the case of any remittances
received in any Lock-Box or Collection Account that shall have been identified,
to the satisfaction of the Servicer, to not constitute Collections or other
proceeds of the Receivables or the Related Security, the Servicer shall promptly
remit such items to the Person identified to it as being the owner of such
remittances. From and after the date the Agent delivers to any Collection Bank a
Collection Notice pursuant to Section 8.3, the Agent may request that the
Servicer, and the Servicer thereupon promptly shall instruct all Obligors with
respect to the Receivables, to remit all payments thereon to a new depositary
account specified by the Agent and, at all times thereafter, Borrower and the
Servicer shall not deposit or otherwise credit, and shall not permit any other
Person to deposit or otherwise credit to such new depositary account any cash or
payment item other than Collections.
(c) The Servicer shall administer the Collections in accordance with
the procedures described herein and in Article II. The Servicer shall set aside
and hold in trust for the account of Borrower and the Lenders their respective
shares of the Collections in accordance with Article II. The Servicer shall,
upon the request of the Agent, segregate, in a manner acceptable to the Agent,
all cash, checks and other instruments received by it from time to time
constituting
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Collections from the general funds of the Servicer or Borrower prior to the
remittance thereof in accordance with Article II. If the Servicer shall be
required to segregate Collections pursuant to the preceding sentence, the
Servicer shall segregate and deposit with a bank designated by the Agent such
allocable share of Collections of Receivables set aside for the Lenders on the
first Business Day following receipt by the Servicer of such Collections, duly
endorsed or with duly executed instruments of transfer.
(d) The Servicer may, in accordance with the Credit and Collection
Policy, extend the maturity of any Receivable or adjust the Outstanding Balance
of any Receivable as the Servicer determines to be appropriate to maximize
Collections thereof; provided, however, that such extension or adjustment shall
not alter the status of such Receivable as a Delinquent Receivable or Defaulted
Receivable or limit the rights of the Agent or the Lenders under this Agreement.
Notwithstanding anything to the contrary contained herein, the Agent shall at
all times after the occurrence of an Amortization Event have the absolute and
unlimited right to direct the Servicer to commence or settle any legal action
with respect to any Receivable or to foreclose upon or repossess any Related
Security.
(e) The Servicer shall hold in trust for Borrower and the Lenders
all Records that (i) evidence or relate to the Receivables, the related
Contracts and Related Security or (ii) are otherwise necessary or desirable to
collect the Receivables and shall, as soon as practicable upon demand of the
Agent, deliver or make available to the Agent all such Records, at a place
selected by the Agent. The Servicer shall, as soon as practicable following
receipt thereof turn over to Borrower any cash collections or other cash
proceeds in accordance with Article II. The Servicer shall, from time to time at
the request of any Lender, furnish to the Lenders (promptly after any such
request) a calculation of the amounts set aside for the Lenders pursuant to
Article II.
(f) Any payment by an Obligor in respect of any indebtedness owed by
it to Originator or Borrower shall, except as otherwise specified by such
Obligor or otherwise required by contract or law and unless otherwise instructed
by the Agent, be applied as a Collection of any Receivable of such Obligor
(starting with the oldest such Receivable) to the extent of any amounts then due
and payable thereunder before being applied to any other receivable or other
obligation of such Obligor.
SECTION 8.3 COLLECTION NOTICES.
The Agent is authorized at any time to date and to deliver to the
Collection Banks the Collection Notices. Borrower hereby transfers to the Agent
for the benefit of the Lenders, effective when the Agent delivers such notice,
the exclusive ownership and control of each Lock-Box and the Collection
Accounts. In case any authorized signatory of Borrower whose signature appears
on a Collection Account Agreement shall cease to have such authority before the
delivery of such notice, such Collection Notice shall nevertheless be valid as
if such authority had remained in force. Borrower hereby authorizes the Agent,
and agrees that the Agent shall be entitled (a) at any time after delivery of
the Collection Notices, to endorse Borrower's name on checks and other
instruments representing Collections, (b) at any time after the occurrence of an
Amortization Event, to enforce the Receivables, the related Contracts and the
Related Security, and (c) at any time after the occurrence of an Amortization
Event, to take such action as shall be
26
necessary or desirable to cause all cash, checks and other instruments
constituting Collections of Receivables to come into the possession of the Agent
rather than Borrower.
SECTION 8.4 RESPONSIBILITIES OF BORROWER.
Anything herein to the contrary notwithstanding, the exercise by the
Agent and the Lenders of their rights hereunder shall not release the Servicer,
any Originator or Borrower from any of their duties or obligations with respect
to any Receivables or under the related Contracts. The Lenders shall have no
obligation or liability with respect to any Receivables or related Contracts,
nor shall any of them be obligated to perform the obligations of Borrower.
SECTION 8.5 MONTHLY REPORTS.
The Servicer shall prepare and forward to the Agent (a) on each Monthly
Reporting Date, a Monthly Report and an electronic file of the data contained
therein and (b) at such times as the Agent shall request, (i) a listing by
Obligor of all Receivables together with an aging of such Receivables and (ii)
other interim reporting as may from time to time be requested by the Agent.
SECTION 8.6 SERVICING FEE.
As compensation for the Servicer's servicing activities on their behalf,
the Lenders hereby agree to pay the Servicer the Servicing Fee, which fee shall
be paid in arrears on each Settlement Date.
ARTICLE IX
AMORTIZATION EVENTS
SECTION 9.1 AMORTIZATION EVENTS.
The occurrence of any one or more of the following events shall
constitute an Amortization Event:
(a) Any Loan Party or Performance Guarantor shall fail to make any
payment or deposit required to be made by it under the Transaction Documents
when due and, for any such payment or deposit which is not in respect of
principal, such failure continues for two (2) consecutive Business Days.
(b) Any representation or warranty made by Performance Guarantor or
any Loan Party in any Transaction Document to which it is a party or in any
other document delivered pursuant thereto shall prove to have been incorrect
when made or deemed made.
(c) Any Loan Party shall fail to perform or observe any covenant
contained in Section 7.2 or 8.5 when due.
(d) Any Loan Party or Performance Guarantor shall fail to perform or
observe any other covenant or agreement under any Transaction Documents and such
failure shall continue for fifteen (15) consecutive calendar days after the
earlier of (i) the date on which a Responsible
27
Officer of such Person became aware, or should have become aware, of such
failure and (ii) written notice thereof has been given to such Person by the
Agent or any Lender.
(e) Failure of Borrower to pay any Indebtedness (other than the
Obligations) when due or the default by Borrower in the performance of any term,
provision or condition contained in any agreement under which any such
Indebtedness was created or is governed, the effect of which is to cause, or to
permit the holder or holders of such Indebtedness to cause, such Indebtedness to
become due prior to its stated maturity; or any such Indebtedness of Borrower
shall be declared to be due and payable or required to be prepaid (other than by
a regularly scheduled payment) prior to the date of maturity thereof.
(f) Failure of Performance Guarantor or any of its Subsidiaries
other than Borrower to pay Indebtedness in excess of $20,000,000 in aggregate
principal amount (hereinafter, "Material Indebtedness") when due; or the default
by Performance Guarantor or any of its Subsidiaries other than Borrower in the
performance of any term, provision or condition contained in any agreement under
which any Material Indebtedness was created or is governed, the effect of which
is to cause, or to permit the holder or holders of such Material Indebtedness to
cause, such Material Indebtedness to become due prior to its stated maturity; or
any Material Indebtedness of Performance Guarantor or any of its Subsidiaries
other than Borrower shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled payment) prior to the date of
maturity thereof.
(g) An Event of Bankruptcy shall occur with respect to Performance
Guarantor, any Loan Party or any of their respective Subsidiaries.
(h) As at the end of any Calculation Period:
(i) the three-month rolling average Delinquency Ratio shall
exceed 2.50%,
(ii) the three-month rolling average Default Ratio shall
exceed 1.50%, or
(iii) the three-month rolling average Dilution Ratio shall
exceed 2.25%.
(i) A Change of Control shall occur.
(j) (i) One or more final judgments for the payment of money in an
aggregate amount of $10,750 or more shall be entered against Borrower or (ii)
one or more final judgments for the payment of money in an amount in excess of
$20,000,000, individually or in the aggregate, shall be entered against
Performance Guarantor or any of its Subsidiaries (other than Borrower) on claims
not covered by insurance or as to which the insurance carrier has denied its
responsibility, and such judgment shall continue unsatisfied and in effect for
thirty (30) consecutive days without a stay of execution.
(k) The "Termination Date" under and as defined in the Receivables
Sale Agreement shall occur under the Receivables Sale Agreement or any
Originator shall for any reason cease to transfer, or cease to have the legal
capacity to transfer, or otherwise be incapable of transferring Receivables to
Borrower under the Receivables Sale Agreement.
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(l) This Agreement shall terminate in whole or in part (except in
accordance with its terms), or shall cease to be effective or to be the legally
valid, binding and enforceable obligation of Borrower, or any Obligor shall
directly or indirectly contest in any manner such effectiveness, validity,
binding nature or enforceability, or the Agent for the benefit of the Lenders
shall cease to have a valid and perfected first priority security interest in
the Collateral.
(m) On any Settlement Date, after giving effect to the turnover of
Collections by the Servicer on such date and the application thereof to the
Obligations in accordance with this Agreement, the Aggregate Principal shall
exceed the Borrowing Limit.
(n) The Performance Undertaking shall cease to be effective or to be
the legally valid, binding and enforceable obligation of Performance Guarantor,
or Performance Guarantor shall directly or indirectly contest in any manner such
effectiveness, validity, binding nature or enforceability of its obligations
thereunder.
(o) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Tax Code with regard to any of the Collateral
and such lien shall continue until the earlier of (i) seven (7) days after
inception and (ii) knowledge by any Secured Party of such lien, or the PBGC
shall, or shall indicate its intention to, file notice of a lien pursuant to
Section 4068 of ERISA with regard to any of the Collateral.
(p) Any of the Controlled Group shall:
(i) fail to pay when due an amount or amounts aggregating in
excess of $15,000,000 which it shall have become liable to pay to the
PBGC or to a Plan under Title IV of ERISA except where the failure to so
pay would not have a Material Adverse Effect; or notice of intent to
terminate a Plan or Plans which would have a Material Adverse Effect
(collectively, a "Material Plan") shall be filed under Title IV of ERISA
by any member of the Controlled Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate or to cause a trustee to be
appointed to administer any Material Plan or a proceeding shall be
instituted by a fiduciary of any Material Plan against any member of the
Controlled Group to enforce Section 515 of ERISA and such proceeding
shall not have been dismissed within 30 days thereafter; or a condition
shall exist by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any Material Plan must be terminated; or
(ii) have been notified by the sponsor of a Multiemployer
Plan that it has incurred an aggregate Withdrawal Liability for all
years to such Multiemployer Plan in an amount that, when aggregated with
all other amounts then required to be paid to Multiemployer Plans by the
Controlled Group as Withdrawal Liability (determined as of the date of
such notification), exceeds $15,000,000 and it is reasonably likely that
all amounts then required to be paid to Multiemployer Plans by the
Controlled Group as Withdrawal Liability will exceed $15,000,000; or
(iii) have been notified by the sponsor of a Multiemployer
Plan that such Multiemployer Plan is in reorganization or is being
terminated, within the meaning of
29
Title IV of ERISA, and it is reasonably likely that as a result of such
reorganization or termination the aggregate annual contributions of the
Controlled Group to all Multiemployer Plans that are then in
reorganization or being terminated have been or will be increased over
the amounts contributed to such Multiemployer Plans for the plan year of
such Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount exceeding $15,000,000.
(q) Any event shall occur which (i) materially and adversely impairs
the ability of the Originators to originate Receivables of a credit quality that
is at least equal to the credit quality of the Receivables sold or contributed
to Borrower on the date of this Agreement or (ii) has, or could be reasonably
expected to have a Material Adverse Effect.
(r) Any breach at any relevant time by the Performance Guarantor of
any financial covenant incorporated by reference pursuant to Section 6A of the
Performance Undertaking.
(s) At any time the sum of (i) Availability and (ii) Excess
Availability shall be less than $15 million.
SECTION 9.2 REMEDIES.
Upon the occurrence and during the continuation of an Amortization
Event, the Agent may, or upon the direction of the Required Liquidity Banks
shall, take any of the following actions: (a) replace the Person then acting as
Servicer if the Agent has not already done so, (b) declare the Amortization Date
to have occurred, whereupon the Aggregate Commitment shall immediately terminate
and the Amortization Date shall forthwith occur, all without demand, protest or
further notice of any kind, all of which are hereby expressly waived by each
Loan Party; provided, however, that upon the occurrence of an Event of
Bankruptcy with respect to any Loan Party, the Amortization Date shall
automatically occur, without demand, protest or any notice of any kind, all of
which are hereby expressly waived by each Loan Party, (c) deliver the Collection
Notices to the Collection Banks, (d) exercise all rights and remedies of a
secured party upon default under the UCC and other applicable laws, and (e)
notify Obligors of the Agent's security interest in the Receivables and other
Collateral. The aforementioned rights and remedies shall be without limitation,
and shall be in addition to all other rights and remedies of the Agent and the
Lenders otherwise available under any other provision of this Agreement, by
operation of law, at equity or otherwise, all of which are hereby expressly
preserved, including, without limitation, all rights and remedies provided under
the UCC, all of which rights shall be cumulative.
ARTICLE X
INDEMNIFICATION
SECTION 10.1 INDEMNITIES BY THE LOAN PARTIES.
(a) Without limiting any other rights that the Agent or any Lender
may have hereunder or under applicable law, (x) Borrower hereby agrees to
indemnify (and pay upon demand to) the Agent, Blue Ridge, each of the Liquidity
Banks and each of the respective assigns, officers, directors, agents and
employees of the foregoing (each, an "Indemnified Party")
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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 the Agent or such Lender) 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 a Lender of an
interest in the Receivables, and (y) the Servicer hereby agrees to indemnify
(and pay upon demand to) each Indemnified Party for Indemnified Amounts awarded
against or incurred by any of them arising out of the Servicer's activities as
Servicer hereunder excluding, however, in all of the foregoing instances under
the preceding clauses (x) and (y):
(i) 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;
(ii) 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
(iii) (1) taxes imposed on its income, and franchise taxes or
excises taxes imposed on it, by the jurisdiction under the laws of which
such Indemnified Party or Funding Source is organized or any political
subdivision thereof or in which its principal office is located, (2)
taxes imposed on its income, and franchise taxes or excise taxes imposed
on it, by the jurisdiction of such Indemnified Party's or Funding
Source's applicable lending office or any political subdivision thereof,
(3) taxes imposed upon or measured by the overall net income of such
Indemnified Party or Funding Source by the United States of America or
any political subdivision or taxing authority thereof or therein, and
(4) United States income taxes imposed under any law (including without
limitation any statute, treaty, ruling, determination or regulation) in
effect on the date hereof in the case of any Indemnified Party or
Funding Source (as the case may be) and on the effective date of the
assignment pursuant to which it became a Indemnified Party or Funding
Source; provided, however, that any taxes that are imposed on an
Indemnified Party because of the acquisition by the Lenders of Loans is
not treated for income tax purposes as a loan or loans by the Lenders to
Borrower secured by the Receivables, the Related Security, the
Collections Accounts and the Collections are not covered by the
exclusion to indemnification set forth in this subclause (iii);
provided, however, that nothing contained in this sentence shall limit the
liability of any Loan Party or limit the recourse of the Lenders to any Loan
Party for amounts otherwise specifically provided to be paid by such Loan Party
under the terms of this Agreement.
(b) Without limiting the generality of the foregoing
indemnification, Borrower shall indemnify the Agent and the Lenders for
Indemnified Amounts (including, without limitation, losses in respect of
uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to Borrower or the Servicer) relating to or resulting from:
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(i) any representation or warranty made by any Loan Party or
any Originator (or any officers of any such Person) under or in
connection with this Agreement, any other Transaction Document 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 Borrower, the Servicer or any Originator
to comply with any applicable law, rule or regulation with respect to
any Receivable or Contract related thereto, or the nonconformity of any
Receivable or Contract included therein 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
Contract;
(iii) any failure of Borrower, the Servicer or any Originator
to perform its duties, covenants or other obligations in accordance with
the provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or damage suit,
or other similar claim arising out of or in connection with merchandise,
insurance or services that are the subject of any Contract or any
Receivable;
(v) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment of
any Receivable (including, without limitation, a defense based on such
Receivable or the related Contract 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
service related to such Receivable or the furnishing or failure to
furnish such merchandise or services;
(vi) the commingling of Collections of 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, the
transactions contemplated hereby, the use of the proceeds of any
Advance, the Collateral or any other investigation, litigation or
proceeding relating to Borrower, the Servicer or any 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 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) any Amortization Event described in Section 9.1(g);
(x) any failure of Borrower to acquire and maintain legal
and equitable title to, and ownership of any of the Collateral from the
applicable Originator, free and clear of any Adverse Claim (other than
as created hereunder); or any failure of Borrower to give reasonably
equivalent value to any Originator under the Receivables Sale Agreement
in consideration of the transfer by such Originator of any Receivable,
or any
32
attempt by any Person to void such transfer under statutory provisions
or common law or equitable action;
(xi) any failure to vest and maintain vested in the Agent for
the benefit of the Lenders, or to transfer to the Agent for the benefit
of the Secured Parties, a valid first priority perfected security
interests in the Collateral, free and clear of any Adverse Claim (except
as created by the Transaction Documents);
(xii) 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 Collateral, and the proceeds thereof, whether at the time of any
Advance or at any subsequent time;
(xiii) any action or omission by any Loan Party which reduces
or impairs the rights of the Agent or the Lenders with respect to any
Collateral or the value of any Collateral;
(xiv) any attempt by any Person to void any Advance or the
Agent's security interest in the Collateral under statutory provisions
or common law or equitable action; and
(xv) the failure of any Receivable included in the
calculation of the Net Pool Balance as an Eligible Receivable to be an
Eligible Receivable at the time so included.
(c) Notwithstanding any other provision of this Agreement, Borrower
shall not be required to indemnify or pay any additional amounts to any
Indemnified Party or Funding Source pursuant to this Section 10.1 or Section
10.2 with respect to Taxes imposed by the United States if the obligation to
withhold with respect to such Taxes results from, or would not have occurred but
for, the failure of any Indemnified Party or Funding Source to deliver to
Borrower (i) a complete and properly executed Internal Revenue Service Form
W-8BEN or W-8ECI, as appropriate, or any successor form prescribed by the
Internal Revenue Service, certifying that such Indemnified Party or Funding
Source is entitled to benefits under an income tax treaty to which the United
States is a party which reduces to zero the rate of withholding tax on payments
due under this Agreement or certifying that the income receivable pursuant to
this Agreement or any of the other Transaction Documents is effectively
connected with the conduct of trade or business in the United States, (ii) a
complete and properly executed Internal Revenue Service Form W-9, or any
successor form prescribed by the Internal Revenue Service, (iii) any other
complete and properly executed form or certificate required by any taxing
authority (including any certificate required by Sections 871(h) and 881(c) of
the Tax Code), certifying that such Indemnified Party or Funding Source is
entitled to a complete exemption from tax on payments pursuant to this Agreement
or any of the other Transaction Documents, or (iv) a complete and properly
executed Internal Revenue Service Form W-8IMY and any related documents required
in conjunction with such W-8IMY (unless such failure is due to a change in
treaty, law or regulation occurring subsequent to the date on which a form
originally was required to be provided). The Indemnified Party or Funding Source
shall not have failed to comply with the provisions of this Section 10.1(c) if
it is legally unable to deliver the forms described herein.
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(d) If any Indemnified Party or Funding Source actually receives a
refund or actually realizes the benefit of a credit or reduction in respect of
any Taxes for which it has received any Indemnified Amounts or payments pursuant
to Section 10.2 with respect to Taxes, such Indemnified Party or Funding Source
shall within 45 days from the date of such receipt or realization pay over the
amount of such refund, credit or reduction to the Borrower (but only to the
extent of the Indemnified Amounts or payments made pursuant to Section 10.2 with
respect to Taxes), net of all reasonable out-of-pocket expenses of such
Indemnified Party or Funding Source and without interest (other than interest
paid by the relevant Governmental Authority with respect to such refund, credit
or reduction); provided, however, that any failure to make, or delay in making,
any such payment shall not give rise to any liability of such Indemnified Party
or Funding Source in addition to the obligation hereunder to make such payment.
(e) References in this Section 10 to any Indemnified Party or the
Funding Source shall also refer to and include any assignee, participant,
transferee, successor or designee of all or a portion of such Indemnified
Party's or the Funding Source's rights and obligations under this Agreement.
Therefore, each assignee, participant, transferee, successor or designee shall
be required to deliver or cause to be delivered to the Borrower properly
completed and duly executed documents as provided in Section 10.1(c).
SECTION 10.2 INCREASED COST AND REDUCED RETURN.
If after the date hereof, any Funding Source shall be charged any fee,
expense or increased cost on account of the adoption of any applicable law, rule
or regulation (including any applicable law, rule or regulation regarding
capital adequacy) or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or any
accounting board or authority (whether or not part of government) which is
responsible for the establishment or interpretation of national or international
accounting principles, in each case whether foreign or domestic or compliance
with any request or directive (whether or not having the force of law) of any
such authority, central bank or comparable agency (a "Regulatory Change"): (a)
that subjects any Funding Source to any charge or withholding on or with respect
to any Funding Agreement or a Funding Source's obligations under a Funding
Agreement, or on or with respect to the Receivables, or changes the basis of
taxation of payments to any Funding Source of any amounts payable under any
Funding Agreement (except for changes in the rate of tax on the overall net
income of a Funding Source or taxes excluded by Section 10.1) or (b) that
imposes, modifies or deems applicable any reserve, assessment, insurance charge,
special deposit or similar requirement against assets of, deposits with or for
the account of a Funding Source, or credit extended by a Funding Source pursuant
to a Funding Agreement or (c) that imposes any other condition the result of
which is to increase the cost to a Funding Source of performing its obligations
under a Funding Agreement, or to reduce the rate of return on a Funding Source's
capital as a consequence of its obligations under a Funding Agreement, or to
reduce the amount of any sum received or receivable by a Funding Source under a
Funding Agreement or to require any payment calculated by reference to the
amount of interests or loans held or interest received by it, then, upon receipt
of a written demand (which demand shall be accompanied by a statement of the
basis for such demand and the amounts owed) by the Agent, Borrower shall pay to
the Agent, for the benefit of the relevant Funding Source, such amounts charged
to such Funding Source or such amounts to otherwise compensate such Funding
Source for such
34
increased cost or such reduction. For avoidance of doubt, any interpretation of
Accounting Research Bulletin No. 51 by the Financial Accounting Standards Board
shall constitute an adoption, change, request or directive subject to this
Section 10.2.
SECTION 10.3 OTHER COSTS AND EXPENSES.
Borrower shall pay to the Agent and Blue Ridge, upon receipt of a
written demand (which demand shall be accompanied by a statement of the basis
for such demand and the amounts owed), all costs and out-of-pocket expenses in
connection with the preparation, execution, delivery and administration of this
Agreement, the transactions contemplated hereby and the other documents to be
delivered hereunder, including without limitation, the cost of Blue Ridge's
auditors auditing the books, records and procedures of Borrower, reasonable fees
and out-of-pocket expenses of legal counsel for Blue Ridge and the Agent (which
such counsel may be employees of Blue Ridge or the Agent) with respect thereto
and with respect to advising Blue Ridge and the Agent as to their respective
rights and remedies under this Agreement. Borrower shall pay to the Agent on
demand any and all costs and expenses of the Agent and the Lenders, if any,
including reasonable counsel fees and expenses in connection with the
enforcement of this Agreement and the other documents delivered hereunder and in
connection with any restructuring or workout of this Agreement or such
documents, or the administration of this Agreement following an Amortization
Event. Borrower shall reimburse Blue Ridge on demand for all other costs and
expenses incurred by Blue Ridge ("Other Costs"), including, without limitation,
the cost of auditing Blue Ridge's books by certified public accountants, the
cost of rating the Commercial Paper by independent financial rating agencies,
and the reasonable fees and out-of-pocket expenses of counsel for Blue Ridge or
any counsel for any shareholder of Blue Ridge with respect to advising Blue
Ridge or such shareholder as to matters relating to Blue Ridge's operations.
SECTION 10.4 ALLOCATIONS.
Blue Ridge shall allocate the liability for Other Costs among Borrower
and other Persons with whom Blue Ridge has entered into agreements to purchase
interests in or finance receivables and other financial assets ("Other
Customers"). If any Other Costs are attributable to Borrower and not
attributable to any Other Customer, Borrower shall be solely liable for such
Other Costs. However, if Other Costs are attributable to Other Customers and not
attributable to Borrower, such Other Customer shall be solely liable for such
Other Costs. All allocations to be made pursuant to the foregoing provisions of
this Article X shall be made by Blue Ridge in its sole discretion and shall be
binding on Borrower and the Servicer.
ARTICLE XI
THE AGENT
SECTION 11.1 AUTHORIZATION AND ACTION.
Each Lender hereby designates and appoints Wachovia to act as its agent
under the Transaction Documents and under the Liquidity Agreement, and
authorizes the Agent to take such actions as agent on its behalf and to exercise
such powers as are delegated to the Agent by
35
the terms of the Liquidity Agreement or the Transaction Documents, together with
such powers as are reasonably incidental thereto. The Agent shall not have any
duties or responsibilities, except those expressly set forth in the Liquidity
Agreement or in any Transaction Document, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities on the part of the Agent shall be read into the
Liquidity Agreement or any Transaction Document or otherwise exist for the
Agent. In performing its functions and duties under the Liquidity Agreement and
the Transaction Documents, the Agent shall act solely as agent for the Lenders
and does not assume nor shall be deemed to have assumed any obligation or
relationship of trust or agency with or for any Loan Party or any of such Loan
Party's successors or assigns. The Agent shall not be required to take any
action that exposes the Agent to personal liability or that is contrary to the
Liquidity Agreement or any Transaction Document or applicable law. The
appointment and authority of the Agent hereunder shall terminate upon the
indefeasible payment in full of all Obligations. Each Lender hereby authorizes
the Agent to file each of the UCC financing statements and each Collection
Account Agreement on behalf of such Lender (the terms of which shall be binding
on such Lender).
SECTION 11.2 DELEGATION OF DUTIES.
The Agent may execute any of its duties under the Liquidity Agreement
and each Transaction Document by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Agent shall not be responsible for the negligence or misconduct of
any agents or attorneys-in-fact selected by it with reasonable care.
SECTION 11.3 EXCULPATORY PROVISIONS.
Neither the Agent nor any of its directors, officers, agents or
employees shall be (a) liable for any action lawfully taken or omitted to be
taken by it or them under or in connection with the Liquidity Agreement or any
Transaction Document (except for its, their or such Person's own gross
negligence or willful misconduct), or (b) responsible in any manner to any of
the Lenders for any recitals, statements, representations or warranties made by
any Loan Party contained in the Liquidity Agreement, any Transaction Document or
any certificate, report, statement or other document referred to or provided for
in, or received under or in connection with, any Transaction Document or for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
the Liquidity Agreement or any Transaction Document or any other document
furnished in connection therewith, or for any failure of any Loan Party to
perform its obligations under any Transaction Document, or for the satisfaction
of any condition specified in Article VI, or for the perfection, priority,
condition, value or sufficiency of any collateral pledged in connection
herewith. The Agent shall not be under any obligation to any Lender to ascertain
or to inquire as to the observance or performance of any of the agreements or
covenants contained in, or conditions of, any Transaction Document, or to
inspect the properties, books or records of the Loan Parties. The Agent shall
not be deemed to have knowledge of any Amortization Event or Unmatured
Amortization Event unless the Agent has received notice from a Loan Party or a
Lender.
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SECTION 11.4 RELIANCE BY AGENT.
The Agent shall in all cases be entitled to rely, and shall be fully
protected in relying, upon any document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to Borrower), independent accountants and other experts
selected by the Agent. The Agent shall in all cases be fully justified in
failing or refusing to take any action under the Liquidity Agreement or any
Transaction Document unless it shall first receive such advice or concurrence of
Blue Ridge or the Required Liquidity Banks or all of the Lenders, as applicable,
as it deems appropriate and it shall first be indemnified to its satisfaction by
the Lenders, provided that unless and until the Agent shall have received such
advice, the Agent may take or refrain from taking any action, as the Agent shall
deem advisable and in the best interests of the Lenders. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, in accordance
with a request of Blue Ridge or the Required Liquidity Banks or all of the
Lenders, as applicable, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders.
SECTION 11.5 NON-RELIANCE ON AGENT AND OTHER LENDERS.
Each Lender expressly acknowledges that neither the Agent, nor any of
its officers, directors, employees, agents, attorneys-in-fact or affiliates has
made any representations or warranties to it and that no act by the Agent
hereafter taken, including, without limitation, any review of the affairs of any
Loan Party, shall be deemed to constitute any representation or warranty by the
Agent. Each Lender represents and warrants to the Agent that it has and will,
independently and without reliance upon the Agent or any other Lender and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of Borrower and
made its own decision to enter into the Liquidity Agreement, the Transaction
Documents and all other documents related thereto.
SECTION 11.6 REIMBURSEMENT AND INDEMNIFICATION.
The Liquidity Banks agree to reimburse and indemnify the Agent and its
officers, directors, employees, representatives and agents ratably according to
their Pro Rata Shares, to the extent not paid or reimbursed by the Loan Parties
(a) for any amounts for which the Agent, acting in its capacity as Agent, is
entitled to reimbursement by the Loan Parties hereunder and (b) for any other
expenses incurred by the Agent, in its capacity as Agent and acting on behalf of
the Lenders, in connection with the administration and enforcement of the
Liquidity Agreement and the Transaction Documents.
SECTION 11.7 AGENT IN ITS INDIVIDUAL CAPACITY.
The Agent and its Affiliates may make loans to, accept deposits from and
generally engage in any kind of business with Borrower or any Affiliate of
Borrower as though the Agent were not the Agent hereunder. With respect to the
making of Loans pursuant to this Agreement, the Agent shall have the same rights
and powers under the Liquidity Agreement and this Agreement in its individual
capacity as any Lender and may exercise the same as though it were
37
not the Agent, and the terms "Liquidity Bank," "Lender," "Liquidity Banks" and
"Lenders" shall include the Agent in its individual capacity.
SECTION 11.8 SUCCESSOR AGENT.
The Agent, upon five (5) days' notice to the Loan Parties and the
Lenders, may voluntarily resign and may be removed at any time, with or without
cause, by the Required Liquidity Lenders; provided, however, that Wachovia shall
not voluntarily resign as the Agent so long as any of the Liquidity Commitments
remain in effect or Blue Ridge has any outstanding Loans. If the Agent (other
than Wachovia) shall voluntarily resign or be removed as Agent under this
Agreement, then the Required Liquidity Lenders during such five-day period shall
appoint, from among the remaining Liquidity Banks, a successor Agent, whereupon
such successor Agent shall succeed to the rights, powers and duties of the Agent
and the term "Agent" shall mean such successor agent, effective upon its
appointment, and the former Agent's rights, powers and duties as Agent shall be
terminated, without any other or further act or deed on the part of such former
Agent or any of the parties to this Agreement. Upon resignation or replacement
of any Agent in accordance with this Section 11.8, the retiring Agent shall
execute such UCC-3 assignments and amendments, and assignments and amendments of
the Liquidity Agreement and the Transaction Documents, as may be necessary to
give effect to its replacement by a successor Agent. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Article XI and Article X
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement.
ARTICLE XII
ASSIGNMENTS; PARTICIPATIONS
SECTION 12.1 ASSIGNMENTS.
(a) Each of the Agent, the Loan Parties and the Liquidity Banks
hereby agrees and consents to the complete or partial assignment by Blue Ridge
of all or any portion of its rights under, interest in, title to and obligations
under this Agreement to the Liquidity Banks pursuant to the Liquidity Agreement.
(b) Any Liquidity Bank may at any time and from time to time assign
to one or more Eligible Assignees (each, a "Purchasing Liquidity Bank") all or
any part of its rights and obligations under this Agreement pursuant to an
assignment agreement substantially in the form set forth in Exhibit VII hereto
(an "Assignment Agreement") executed by such Purchasing Liquidity Bank and such
selling Liquidity Bank; provided, however, that any assignment of a Liquidity
Bank's rights and obligations hereunder shall include a pro rata assignment of
its rights and obligations under the Liquidity Agreement. The consent of Blue
Ridge shall be required prior to the effectiveness of any such assignment. Each
assignee of a Liquidity Bank must (i) be an Eligible Assignee and (ii) agree to
deliver to the Agent, promptly following any request therefor by the Agent or
Blue Ridge, an enforceability opinion in form and substance satisfactory to the
Agent and Blue Ridge. Upon delivery of an executed Assignment Agreement to the
Agent, such selling Liquidity Bank shall be released from its obligations
hereunder and under the Liquidity Agreement to the extent of such assignment.
Thereafter the Purchasing Liquidity Bank
38
shall for all purposes be a Liquidity Bank party to this Agreement and the
Liquidity Agreement and shall have all the rights and obligations of a Liquidity
Bank hereunder and thereunder to the same extent as if it were an original party
hereto and thereto and no further consent or action by Borrower, the Lenders or
the Agent shall be required.
(c) Each of the Liquidity Banks agrees that in the event that it
shall suffer a Downgrading Event, such Downgraded Liquidity Bank shall, at the
request of Blue Ridge or the Agent, either (i) collateralize its Commitment and
its Liquidity Commitment in a manner acceptable to the Agent, or (ii) assign all
of its rights and obligations hereunder and under the Liquidity Agreement to an
Eligible Assignee nominated by the Agent or a Loan Party and acceptable to Blue
Ridge and willing to participate in this Agreement and the Liquidity Agreement
through the Liquidity Termination Date in the place of such Downgraded Liquidity
Bank; provided that the Downgraded Liquidity Bank receives payment in full,
pursuant to an Assignment Agreement, of an amount equal to such Liquidity Bank's
Pro Rata Share of the Obligations owing to the Liquidity Banks.
(d) No Loan Party may assign any of its rights or obligations under
this Agreement without the prior written consent of the Agent and each of the
Lenders and without satisfying the Rating Agency Condition.
SECTION 12.2 PARTICIPATIONS.
Any Liquidity Bank may, in the ordinary course of its business at any
time sell to one or more Persons (each, a "Participant") participating interests
in its Pro Rata Share of the Aggregate Commitment, its Loans, its Liquidity
Commitment or any other interest of such Liquidity Bank hereunder or under the
Liquidity Agreement. Notwithstanding any such sale by a Liquidity Bank of a
participating interest to a Participant, such Liquidity Bank's rights and
obligations under this Agreement and the Liquidity Agreement shall remain
unchanged, such Liquidity Bank shall remain solely responsible for the
performance of its obligations hereunder and under the Liquidity Agreement, and
the Loan Parties, Blue Ridge and the Agent shall continue to deal solely and
directly with such Liquidity Bank in connection with such Liquidity Bank's
rights and obligations under this Agreement and the Liquidity Agreement. Each
Liquidity Bank agrees that any agreement between such Liquidity Bank and any
such Participant in respect of such participating interest shall not restrict
such Liquidity Bank's right to agree to any amendment, supplement, waiver or
modification to this Agreement, except for any amendment, supplement, waiver or
modification described in Section 14.1(b)(i).
ARTICLE XIII
SECURITY INTEREST
SECTION 13.1 GRANT OF SECURITY INTEREST.
To secure the due and punctual payment of the Obligations, whether now
or hereafter existing, due or to become due, direct or indirect, or absolute or
contingent, including, without limitation, all Indemnified Amounts, in each case
pro rata according to the respective amounts thereof, Borrower hereby grants to
the Agent, for the benefit of the Secured Parties, a security
39
interest in, all assets of Borrower, including, without limitation, all of
Borrower's right, title and interest, whether now owned and existing or
hereafter arising in and to all of the Receivables, the Related Security, the
Collections and all other assets of Borrower and all proceeds of the foregoing
(collectively, the "Collateral").
SECTION 13.2 TERMINATION AFTER FINAL PAYOUT DATE.
Upon the Final Payout Date, all right, title and interest of the Agent
and the other Secured Parties in and to the Collateral shall terminate.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 WAIVERS AND AMENDMENTS.
(a) No failure or delay on the part of the Agent or any Lender in
exercising any power, right or remedy under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other further exercise thereof or the exercise of
any other power, right or remedy. The rights and remedies herein provided shall
be cumulative and nonexclusive of any rights or remedies provided by law. Any
waiver of this Agreement shall be effective only in the specific instance and
for the specific purpose for which given.
(b) No provision of this Agreement may be amended, supplemented,
modified or waived except in writing in accordance with the provisions of this
Section 14.1(b). Blue Ridge, Borrower and the Agent, at the direction of the
Required Liquidity Banks, may enter into written modifications or waivers of any
provisions of this Agreement, provided, however, that no such modification or
waiver shall:
(i) without the consent of each affected Lender, (A) extend
the Liquidity Termination Date or the date of any payment or deposit of
Collections by Borrower or the Servicer, (B) reduce the rate or extend
the time of payment of Interest or any CP Costs (or any component of
Interest or CP Costs), reduce any fee payable to the Agent for the
benefit of the Lenders, (C) except pursuant to Article XII hereof,
change the amount of the principal of any Lender, any Liquidity Bank's
Pro Rata Share or any Liquidity Bank's Commitment, (D) amend, modify or
waive any provision of the definition of Required Liquidity Banks or
this Section 14.1(b), (E) consent to or permit the assignment or
transfer by Borrower of any of its rights and obligations under this
Agreement, (F) change the definition of "Eligible Receivable," "Loss
Reserve," "Dilution Reserve," "Yield Reserve," "Servicing Reserve,"
"Servicing Fee Rate," "Required Reserve" or "Required Reserve Factor
Floor" or (G) amend or modify any defined term (or any defined term used
directly or indirectly in such defined term) used in clauses (A) through
(G) above in a manner that would circumvent the intention of the
restrictions set forth in such clauses; or
40
(ii) without the written consent of the then Agent, amend,
modify or waive any provision of this Agreement if the effect thereof is
to affect the rights or duties of such Agent,
and any material amendment, waiver or other modification of this Agreement shall
require satisfaction of the Rating Agency Condition. Notwithstanding the
foregoing, (i) without the consent of the Liquidity Banks, but with the consent
of Borrower, the Agent may amend this Agreement solely to add additional Persons
as Liquidity Banks hereunder and (ii) the Agent, the Required Liquidity Banks
and Blue Ridge may enter into amendments to modify any of the terms or
provisions of Article XI, Article XII, Section 14.13 or any other provision of
this Agreement without the consent of Borrower. Any modification or waiver made
in accordance with this Section 14.1 shall apply to each of the Lenders equally
and shall be binding upon Borrower, the Lenders and the Agent.
SECTION 14.2 NOTICES.
Except as provided in this Section 14.2, all communications and notices
provided for hereunder shall be in writing (including bank wire, telecopy or
electronic facsimile transmission or similar writing) and shall be given to the
other parties hereto at their respective addresses or telecopy numbers set forth
on the signature pages hereof or at such other address or telecopy number as
such Person may hereafter specify for the purpose of notice to each of the other
parties hereto. Each such notice or other communication shall be effective (a)
if given by telecopy, upon the receipt thereof, (b) if given by mail, three (3)
Business Days after the time such communication is deposited in the mail with
first class postage prepaid or (c) if given by any other means, when received at
the address specified in this Section 14.2. Borrower hereby authorizes the Agent
to effect Advances and Interest Period and Interest Rate selections based on
telephonic notices made by any Person whom the Agent in good faith believes to
be acting on behalf of Borrower. Borrower agrees to deliver promptly to the
Agent a written confirmation of each telephonic notice signed by an authorized
officer of Borrower; provided, however, the absence of such confirmation shall
not affect the validity of such notice. If the written confirmation differs from
the action taken by the Agent, the records of the Agent shall govern absent
manifest error.
SECTION 14.3 RATABLE PAYMENTS.
If any Lender, whether by setoff or otherwise, has payment made to it
with respect to any portion of the Obligations owing to such Lender (other than
payments received pursuant to Section 10.2 or 10.3) in a greater proportion than
that received by any other Lender entitled to receive a ratable share of such
Obligations, such Lender agrees, promptly upon demand, to purchase for cash
without recourse or warranty a portion of such Obligations held by the other
Lenders so that after such purchase each Lender will hold its ratable proportion
of such Obligations; provided that if all or any portion of such excess amount
is thereafter recovered from such Lender, such purchase shall be rescinded and
the purchase price restored to the extent of such recovery, but without
interest.
41
SECTION 14.4 PROTECTION OF AGENT'S SECURITY INTEREST.
(a) Borrower agrees that from time to time, at its expense, it will
promptly execute and deliver all instruments and documents, and take all
actions, that may be necessary or desirable, or that the Agent may request, to
perfect, protect or more fully evidence the Agent's security interest in the
Collateral, or to enable the Agent or the Lenders to exercise and enforce their
rights and remedies hereunder. At any time, the Agent may, or the Agent may
direct Borrower or the Servicer to, notify the Obligors of Receivables, at
Borrower's expense, of the ownership or security interests of the Lenders under
this Agreement and may also direct that payments of all amounts due or that
become due under any or all Receivables be made directly to the Agent or its
designee. Borrower or the Servicer (as applicable) shall, at any Lender's
request, withhold the identity of such Lender in any such notification.
(b) If any Loan Party fails to perform any of its obligations
hereunder, the Agent or any Lender may (but shall not be required to) perform,
or cause performance of, such obligations, and the Agent's or such Lender's
costs and expenses incurred in connection therewith shall be payable by Borrower
as provided in Section 10.3. (A) each of the Loan Parties hereby authorizes the
Agent to file financing statements and other filing or recording documents with
respect to the Receivables and Related Security (including any amendments
thereto, or continuation or termination statements thereof), without the
signature or other authorization of such Loan Party, in such form and in such
offices as the Agent reasonably determines appropriate to perfect or maintain
the perfection of the security interest of the Agent hereunder, (B) each of the
Loan Parties acknowledges and agrees that it is not authorized to, and will not,
file financing statements or other filing or recording documents with respect to
the Receivables or Related Security (including any amendments thereto, or
continuation or termination statements thereof), without the express prior
written approval by the Agent, consenting to the form and substance of such
filing or recording document, and (C) each of the Loan Parties approves,
authorizes and ratifies any filings or recordings made by or on behalf of the
Agent in connection with the perfection of the security interests in favor of
Borrower or the Agent.
(c) Borrower hereby authorizes the Agent to file all appropriate UCC
financing statements to protect, preserve and perfect the security interest of
the Agent, on behalf of the Secured Parties, granted hereunder by Borrower in
the Collateral.
SECTION 14.5 CONFIDENTIALITY.
(a) Each Loan Party and each Lender shall maintain and shall cause
each of its employees and officers to maintain the confidentiality of this
Agreement and the other confidential or proprietary information with respect to
the Agent and Blue Ridge and their respective businesses obtained by it or them
in connection with the structuring, negotiating and execution of the
transactions contemplated herein, except that such Loan Party and such Lender
and its officers and employees may disclose such information to such Loan
Party's and such Lender's external accountants and attorneys and as required by
any applicable law or order of any judicial or administrative proceeding.
Notwithstanding the foregoing, the Loan Parties and their Affiliates, including
the Performance Guarantor, are permitted to file this Agreement, the
42
Receivables Sale Agreement and the Performance Undertaking with the Securities
and Exchange Commission.
(b) Anything herein to the contrary notwithstanding, each Loan Party
hereby consents to the disclosure of any nonpublic information with respect to
it (i) to the Agent, the Liquidity Banks or Blue Ridge by each other, (ii) by
the Agent or the Lenders to any prospective or actual assignee or participant of
any of them and (iii) by the Agent to any rating agency, Commercial Paper dealer
or provider of a surety, guaranty or credit or liquidity enhancement to Blue
Ridge or any entity organized for the purpose of purchasing, or making loans
secured by, financial assets for which Wachovia acts as the administrative agent
and to any officers, directors, employees, outside accountants and attorneys of
any of the foregoing, provided that each such Person is informed of the
confidential nature of such information. In addition, the Lenders and the Agent
may disclose any such nonpublic information pursuant to any law, rule,
regulation, direction, request or order of any judicial, administrative or
regulatory authority or proceedings (whether or not having the force or effect
of law).
SECTION 14.6 BANKRUPTCY PETITION.
(a) Borrower, the Servicer, the Agent and each Liquidity Bank hereby
covenants and agrees that, prior to the date that is one year and one day after
the payment in full of all outstanding senior indebtedness of Blue Ridge, it
will not institute against, or join any other Person in instituting against,
Blue Ridge any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other similar proceeding under the laws of the United
States or any state of the United States.
(b) Each Loan Party (other than Borrower) hereby covenants and
agrees that, prior to the date that is one year and one day after the payment in
full of all outstanding senior indebtedness of Blue Ridge, it will not institute
against, or join any other Person in instituting against, Borrower any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other similar proceeding under the laws of the United States or any state of
the United States.
SECTION 14.7 LIMITATION OF LIABILITY.
Except with respect to any claim arising out of the willful misconduct
or gross negligence of Blue Ridge, the Agent or any Liquidity Bank, no claim may
be made by any Loan Party or any other Person against Blue Ridge, the Agent or
any Liquidity Bank or their respective Affiliates, directors, officers,
employees, attorneys or agents for any special, indirect, consequential or
punitive damages in respect of any claim for breach of contract or any other
theory of liability arising out of or related to the transactions contemplated
by this Agreement, or any act, omission or event occurring in connection
therewith; and each Loan Party hereby waives, releases, and agrees not to xxx
upon any claim for any such damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
SECTION 14.8 CHOICE OF LAW.
THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
43
TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW.
SECTION 14.9 CONSENT TO JURISDICTION.
EACH PARTY TO THIS AGREEMENT HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT
SITTING IN NEW YORK, NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH PERSON PURSUANT TO
THIS AGREEMENT, AND EACH SUCH PARTY HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE
AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST ANY LOAN PARTY IN THE COURTS OF
ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY LOAN PARTY AGAINST THE
AGENT OR ANY LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH LOAN PARTY
PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW YORK, NEW
YORK.
SECTION 14.10 WAIVER OF JURY TRIAL.
EACH PARTY HERETO HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT,
CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
THIS AGREEMENT, ANY DOCUMENT EXECUTED BY ANY LOAN PARTY PURSUANT TO THIS
AGREEMENT OR THE RELATIONSHIP ESTABLISHED HEREUNDER OR THEREUNDER.
SECTION 14.11 INTEGRATION; BINDING EFFECT; SURVIVAL OF TERMS.
(a) This Agreement and each other Transaction Document contain the
final and complete integration of all prior expressions by the parties hereto
with respect to the subject matter hereof and shall constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
superseding all prior oral or written understandings.
(b) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns
(including any trustee in bankruptcy). 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 terminated in
accordance with its terms; provided, however, that the rights and remedies with
respect to (i) any breach of any representation and warranty made by any Loan
Party pursuant to Article V, (ii) the
44
indemnification and payment provisions of Article X, and Sections 14.5 and 14.6
shall be continuing and shall survive any termination of this Agreement.
SECTION 14.12 COUNTERPARTS; SEVERABILITY; SECTION REFERENCES.
This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute one and the same Agreement. Any provisions of this Agreement
which are prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. Unless otherwise
expressly indicated, all references herein to "Article," "Section," "Schedule"
or "Exhibit" shall mean articles and sections of, and schedules and exhibits to,
this Agreement.
SECTION 14.13 WACHOVIA ROLES.
Each of the Liquidity Banks acknowledges that Wachovia acts, or may in
the future act: (a) as administrative agent for Blue Ridge or any Liquidity
Bank, (b) as an issuing and paying agent for the Commercial Paper, (c) to
provide credit or liquidity enhancement for the timely payment for the
Commercial Paper, and/or (d) to provide other services from time to time for
Blue Ridge or any Liquidity Bank (collectively, the "Wachovia Roles"). Without
limiting the generality of this Section 14.13, each Liquidity Bank hereby
acknowledges and consents to any and all Wachovia Roles and agrees that in
connection with any Wachovia Role, Wachovia may take, or refrain from taking,
any action that it, in its discretion, deems appropriate, including, without
limitation, in its role as administrative agent for Blue Ridge, and the giving
of notice of a mandatory purchase pursuant to the Liquidity Agreement.
[Signature pages follow]
45
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
XXXXXX RECEIVABLES CORPORATION
By: /s/ Xxxx Xxxxxxx
------------------------------------------
Name: Xxxx Xxxxxxx
----------------------------------------
Title: Treasurer
---------------------------------------
Address:
0 Xxxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx, XX 00000
A.T. XXXXXX COAL COMPANY, INC.
By: /s/ Xxxx X. Xxxx
------------------------------------------
Name: Xxxx X. Xxxx
----------------------------------------
Title: Assistant Secretary
---------------------------------------
Address:
0 Xxxxx Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx, XX 00000
[additional signatures to follow]
BLUE RIDGE ASSET FUNDING CORPORATION
BY: Wachovia Securities, Inc.
as Attorney-In-Fact
By: /s/ Xxxxxxx X. Xxxxxx, Xx.
------------------------------------------
Name: Xxxxxxx X. Xxxxxx, Xx.
----------------------------------------
Title: Vice President
---------------------------------------
Address:
Blue Ridge Asset Funding Corporation
c/o Wachovia Securities, Inc.
000 Xxxxx Xxxxxxx Xxxxxx, XX-00
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
WACHOVIA BANK,.
NATIONAL ASSOCIATION,
as a Liquidity Bank and as Agent
By: /s/ Xxxx Xxxx
------------------------------------------
Name: Xxxx Xxxx
----------------------------------------
Title: Vice President
---------------------------------------
Address:
Wachovia Bank, National Association
000 Xxxxxxxxx Xxxxxx, X.X.
Mail Stop GA-8407
Xxxxxxx, XX 00000
Attention: Xxxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
[end of signatures]
EXHIBIT I
DEFINITIONS
As used in this Agreement, the following terms shall have the following meanings
(such meanings to be equally applicable to both the singular and plural forms of
the terms defined):
Adjusted Ageing Balance: The net balance owing from the following Obligors shall
be presented in the "current" ageing category rather than showing components of
the net balance in the various other ageing categories: AEI, Cedar Bay and PG &
E.
Adjusted Dilution Ratio: At any time, the rolling average of the Dilution Ratio
for the 12 Calculation Periods then most recently ended.
Advance: A borrowing hereunder consisting of the aggregate amount of the several
Loans made on the same Borrowing Date.
Adverse Claim: A lien, security interest, charge or encumbrance, or other right
or claim in, of or on any Person's assets or properties in favor of any other
Person.
Affiliate: With respect to any Person, any other Person directly or indirectly
controlling, controlled by, or under direct or indirect common control with,
such Person or any Subsidiary of such Person. A Person shall be deemed to
control another Person if the controlling Person owns 10% or more of any class
of voting securities of the controlled Person or possesses, directly or
indirectly, the power to direct or cause the direction of the management or
policies of the controlled Person, whether through ownership of stock, by
contract or otherwise.
Agent: As defined in the preamble to this Agreement.
Agent's Account: Account #8735-098787 at Wachovia Bank, National Association,
ABA #000000000.
Aggregate Commitment: On any date of determination, the aggregate amount of the
Liquidity Banks' Commitments to make Loans hereunder. As of the date hereof, the
Aggregate Commitment is $80,000,000.
Aggregate Principal: On any date of determination, the aggregate outstanding
principal amount of all Advances outstanding on such date.
Aggregate Reduction: As defined in Section 1.3.
Agreement: This Credit and Security Agreement, as it may be amended or modified
and in effect from time to time.
Alternate Base Rate: For any day, the rate per annum equal to the higher as of
such day of (i) the Prime Rate, or (ii) one-half of one percent (0.50%) above
the Federal Funds Effective Rate. For
I-1
purposes of determining the Alternate Base Rate for any day, changes in the
Prime Rate or the Federal Funds Effective Rate shall be effective on the date of
each such change.
Alternate Base Rate Loan: A Loan which bears interest at the Alternate Base Rate
or the Default Rate.
Amortization Date: The earliest to occur of (i) the day on which any of the
conditions precedent set forth in Section 6.2 are not satisfied, (ii) the
Business Day immediately prior to the occurrence of an Event of Bankruptcy with
respect to any Loan Party, (iii) the Business Day specified in a written notice
from the Agent following the occurrence of any other Amortization Event, and
(iv) the date which is five (5) Business Days after the Agent's receipt of
written notice from Borrower that it wishes to terminate the facility evidenced
by this Agreement.
Amortization Event: As defined in Article IX.
Applicable Margin: As defined in the Fee Letter.
Assignment Agreement: As defined in Section 12.1(b).
Authorized Officer: With respect to any Person, its president, chief accounting
officer, corporate controller, treasurer or chief financial officer.
Availability: As of any date of determination, the amount (if any) equal to the
sum of (i) "unencumbered" cash on the Performance Guarantor's balance sheet (or
that would appear thereon if such date were the date as of which a balance sheet
were prepared) and (ii) the amount by which the aggregate loan commitments of
the lenders under the Credit Agreements at such time exceed the aggregate
outstanding principal balance at such time of all loans made and letters of
credit outstanding under the Credit Agreements, but only to the extent such
amount is available under the Credit Agreements without restriction as to the
ability to use the proceeds of such loan.
Blue Ridge: As defined in the preamble to this Agreement.
Xxxxxxx Receivable: Any Receivable arising as a result of an agreement by the
related Originator to settle in cash the non-delivery of goods as a result of
such Obligor's decision not to purchase the goods otherwise required to be
purchased by such Obligor under such Contract, which Receivable shall be for an
amount equal to the positive excess, if any, of the purchase price for such
goods as provided for in the related Contract over the repurchase price agreed
to be paid by such Originator to such Obligor.
Borrower: As defined in the preamble to this Agreement.
Borrowing Base: On any date of determination, the Net Pool Balance as of the
last day of the period covered by the most recent Monthly Report, minus the
Required Reserve as of the last day of the period covered by the most recent
Monthly Report, and minus Deemed Collections that have occurred since the most
recent Cut-Off Date to the extent that such Deemed Collections exceed the
Dilution Reserve.
I-2
Borrowing Date: A Business Day on which an Advance is made hereunder.
Borrowing Limit: As defined in Section 1.1(a)(i).
Borrowing Notice: As defined in Section 1.2.
Broken Funding Costs: For any CP Rate Loan or LIBO Rate Loan which: (i) in the
case of a CP Rate Loan, has its principal reduced without compliance by Borrower
with the notice requirements hereunder, (ii) in the case of a CP Rate Loan or a
LIBO Rate Loan, does not become subject to an Aggregate Reduction following the
delivery of any Reduction Notice, (iii) in the case of a CP Rate Loan, is
assigned under the Liquidity Agreement, or (iv) in the case of a LIBO Rate Loan,
is terminated or reduced prior to the last day of its Interest Period, an amount
equal to the excess, if any, of (A) the CP Costs or Interest (as applicable)
that would have accrued during the remainder of the Interest Periods or the
tranche periods for Commercial Paper determined by the Agent to relate to such
Loan (as applicable) subsequent to the date of such reduction, assignment or
termination (or in respect of clause (ii) above, the date such Aggregate
Reduction was designated to occur pursuant to the Reduction Notice) of the
principal of such Loan if such reduction, assignment or termination had not
occurred or such Reduction Notice had not been delivered, over (B) the sum of
(x) to the extent all or a portion of such principal is allocated to another
Loan, the amount of CP Costs or Interest actually accrued during the remainder
of such period on such principal for the new Loan, and (y) to the extent such
principal is not allocated to another Loan, the income, if any, actually
received during the remainder of such period by the holder of such Loan from
investing the portion of such principal not so allocated. In the event that the
amount referred to in clause (B) exceeds the amount referred to in clause (A),
the relevant Lender or Lenders agree to pay to Borrower the amount of such
excess. All Broken Funding Costs shall be due and payable hereunder upon demand.
Burn Accrual Report: A written report delivered by an Obligor to an Originator
or the Servicer each month that sets forth the amount of coal or other fuel that
was delivered by such Originator and used by such Obligor during the immediately
preceding calendar month.
Business Day: Any day on which banks are not authorized or required to close in
New York, New York or Atlanta, Georgia, and The Depository Trust Company of New
York is open for business, and, if the applicable Business Day relates to any
computation or payment to be made with respect to the LIBO Rate, any day on
which dealings in dollar deposits are carried on in the London interbank market.
Calculation Period: A calendar month.
Change of Control: The acquisition by any Person, or two or more Persons acting
in concert, of beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of 1934) of
20% or more of the outstanding shares of voting stock of any Loan Party, except
to the extent permitted by Section 7.1(c).
Collateral: As defined in Section 13.1.
I-3
Collection Account: Each concentration account, depositary account, lock-box
account or similar account in which any Collections are collected or deposited
and which is listed on Exhibit IV.
Collection Account Agreement: An agreement substantially in the form of Exhibit
VI among an Originator, [Servicer,] Borrower, the Agent and a Collection Bank,
or such other form as may be acceptable to the Agent.
Collection Bank: At any time, any of the banks holding one or more Collection
Accounts.
Collection Notice: A notice, in substantially the form of Annex A to Exhibit VI,
from the Agent to a Collection Bank.
Collections: With respect to any Receivable, all cash collections and other cash
proceeds in respect of such Receivable, including, without limitation, all
Finance Charges or other related amounts accruing in respect thereof and all
cash proceeds of Related Security with respect to such Receivable.
Commercial Paper: Promissory notes of Blue Ridge issued by Blue Ridge in the
commercial paper market.
Commitment: For each Liquidity Bank, the commitment of such Liquidity Bank to
make Loans to Borrower hereunder in the event the Blue Ridge elects not to fund
any Advance in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Liquidity Bank's name on Schedule A to
this Agreement.
Contaminant: Any material, substance or waste that is classified, regulated or
otherwise characterized under any Environmental Law as hazardous, toxic, a
contaminant or a pollutant or by other words of similar meaning or regulatory
effect, including any petroleum or petroleum-derived substance or waste,
asbestos or polychlorinated biphenyls.
Contingent Obligation: Of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or application for a letter of credit.
Contract: With respect to any Receivable, any and all instruments, agreements,
invoices or other writings pursuant to which such Receivable arises or which
evidences such Receivable.
Controlled Group: All members of a controlled group of corporations and all
trades or businesses (whether or not incorporated) under common control which,
together with any Loan Party, are treated as a single employer for federal
income tax purposes under Section 4l4(b) or 414(c) of the Code.
I-4
CP Costs: For each day, the sum of (i) discount or interest accrued on Pooled
Commercial Paper on such day, plus (ii) any and all accrued commissions in
respect of placement agents and Commercial Paper dealers, and issuing and paying
agent fees incurred, in respect of such Pooled Commercial Paper for such day,
plus (iii) other costs associated with funding small or odd-lot amounts with
respect to all receivable purchase facilities which are funded by Pooled
Commercial Paper for such day, minus (iv) any accrual of income net of expenses
received on such day from investment of collections received under all
receivable purchase or financing facilities funded substantially with Pooled
Commercial Paper, minus (v) any payment received on such day net of expenses in
respect of Broken Funding Costs (or similar costs) related to the prepayment of
any investment of Blue Ridge pursuant to the terms of any receivable purchase or
financing facilities funded substantially with Pooled Commercial Paper. In
addition to the foregoing costs, if Borrower shall request any Advance during
any period of time determined by the Agent in its sole discretion to result in
incrementally higher CP Costs applicable to such Advance, the principal
associated with any such Advance shall, during such period, be deemed to be
funded by Blue Ridge in a special pool (which may include capital associated
with other receivable purchase or financing facilities) for purposes of
determining such additional CP Costs applicable only to such special pool and
charged each day during such period against such principal.
CP Rate Loan: For each Loan of Blue Ridge prior to the time, if any, when (i) it
is refinanced with a Liquidity Funding pursuant to the Liquidity Agreement, or
(ii) the occurrence of an Amortization Event and the commencement of the accrual
of Interest thereon at the Default Rate.
Credit Agreements: Each of the Amended and Restated 364-Day Credit Agreement,
dated as of November 26, 2002 by and among Xxxxxx Energy Company, the guarantors
from time to time party thereto, the financial institutions from time to time
party thereto, Citicorp USA, Inc., PNC Bank, National Association, Wachovia
Bank, National Association and the Amended and Restated Credit Agreement, dated
as of November 26, 2002 by and among Xxxxxx Energy Company, the guarantors from
time to time party thereto, the financial institutions from time to time party
thereto, Citicorp USA, Inc., PNC Bank, National Association, Wachovia Bank,
National Association, each as amended by the first amendment thereto, dated as
of January [31], 2003 and as each such credit agreement exists on the Closing
Date without giving effect to any subsequent amendments, modifications, waivers
or restatements thereof or thereto that have not been approved in writing by the
Agent.
Credit and Collection Policy: Borrower's credit and collection policies and
practices relating to Contracts and Receivables existing on the date hereof and
summarized in Exhibit VIII hereto, as modified from time to time in accordance
with this Agreement.
Cut-Off Date: The last day of a Calculation Period.
Days Sales Outstanding: As of any day, an amount equal to the product of (i) 91,
multiplied by (ii) the amount obtained by dividing (A) the aggregate outstanding
balance of Receivables as of the most recent Cut-Off Date, by (B) the aggregate
amount of Receivables created during the three (3) Calculation Periods including
and immediately preceding such Cut-Off Date.
Deemed Collections: Collections deemed received by Borrower under Section
1.4(a).
I-5
Default Horizon Ratio: As of any Cut-Off Date, the ratio (expressed as a
decimal) computed by dividing (i) the aggregate sales generated by the
Originators during the four (4) Calculation Periods ending on such Cut-Off Date,
by (ii) the Net Pool Balance as of such Cut-off Date.
Default Rate: A rate per annum equal to the sum of (i) the Alternate Base Rate
plus (ii) 2.00%, changing when and as the Alternate Base Rate changes.
Default Ratio: As of any Cut-Off Date, the ratio (expressed as a percentage)
computed by dividing (i) the total amount of Receivables which became Defaulted
Receivables during the Calculation Period that includes such Cut-Off Date, by
(ii) the aggregate sales generated by the Originators during the Calculation
Period occurring four (4) months prior to the Calculation Period ending on such
Cut-Off Date.
Defaulted Receivable: A Receivable: (i) as to which the Obligor thereof has
suffered an Event of Bankruptcy; (ii) which, consistent with the Credit and
Collection Policy, would be written off Borrower's books as uncollectible; or
(iii) as to which any payment, or part thereof, remains unpaid for 91 days or
more from the original due date for such payment; in determining Defaulted
Receivables in accordance with clause (iii) above, the Adjusted Ageing Balances
may be utilized when preparing the Monthly Reports for January, 2003 and
February, 2003.
Delinquency Ratio: At any time, a percentage equal to (i) the aggregate
Outstanding Balance of all Receivables that were Delinquent Receivables at such
time divided by (ii) the aggregate Outstanding Balance of all Receivables at
such time.
Delinquent Receivable: A Receivable as to which any payment, or part thereof,
remains unpaid for 61-90 days from the original due date for such payment; in
determining Delinquent Receivables, the Adjusted Ageing Balances may be utilized
when preparing the Monthly Reports for January, 2003 and February, 2003.
Dilution: The amount of any reduction or cancellation of the Outstanding Balance
of a Receivable as described in Section 1.4(a).
Dilution Horizon Ratio: As of any Cut-off Date, a ratio (expressed as a
decimal), computed by dividing (i) the aggregate sales generated by the
Originators during the two and one-third Calculation Periods ending on such
Cut-Off Date, by (ii) the Net Pool Balance as of such Cut-Off Date.
Dilution Ratio: As of any Cut-Off Date, a ratio (expressed as a percentage),
computed by dividing (i) the total amount of decreases in Outstanding Balances
due to Dilutions during the Calculation Period ending on such Cut-Off Date, by
(ii) the aggregate sales generated by the Originators during the Calculation
Period that is two (2) months prior to the Calculation Period ending on such
Cut-Off Date.
Dilution Reserve: For any Calculation Period, the product (expressed as a
percentage) of:
(i) the sum of (A) two (2) times the Adjusted Dilution Ratio
as of the immediately preceding Cut-Off Date, plus (B) the Dilution
Volatility Component as of the immediately preceding Cut-Off Date, times
I-6
(ii) the Dilution Horizon Ratio as of the immediately
preceding Cut-Off Date.
Dilution Volatility Component: The product (expressed as a percentage) of (i)
the difference between (A) the highest three (3)-month rolling average Dilution
Ratio over the past 12 Calculation Periods and (B) the Adjusted Dilution Ratio,
and (ii) a fraction, the numerator of which is equal to the amount calculated in
(i)(A) of this definition and the denominator of which is equal to the amount
calculated in (i)(B) of this definition.
Downgraded Liquidity Bank: A Liquidity Bank which has been the subject of a
Downgrading Event.
Downgrading Event: With respect to any Person means the lowering of the rating
with regard to the short-term securities of such Person to below (i) A-1 by S&P,
or (ii) P-1 by Moody's.
Eligible Assignee: A commercial bank (i) having a combined capital and surplus
of at least $250,000,000, (ii) a rating of its (or its holding company's)
short-term securities equal to or higher than (a) A-1 by S&P and (b) P-1 by
Moody's and (iii) that, if such Person is not Wachovia or one of its Affiliates,
is acceptable to Borrower (whose consent will not be unreasonably withheld);
provided, that if an Unmatured Amortization Event or Amortization Event has
occurred, no consent of Borrower shall be required.
Eligible Receivable: At any time, a Receivable:
(i) the Obligor of which (A) if a natural person, is a
resident of the United States or, if a corporation or other business
organization, is organized under the laws of the United States, Canada
or any political subdivision thereof and has its chief executive office
in the United States or in Canada; (B) is not an Affiliate of any of the
parties hereto; and (C) is not a government or a governmental
subdivision or agency,
(ii) that is not a Xxxxxxx Receivable,
(iii) which is not a Defaulted Receivable or owing from an
Obligor as to which more than 35% of the aggregate Outstanding Balance
of all Receivables owing from such Obligor are Defaulted Receivables,
(iv) if such Receivable was originated by Central West
Virginia Coal Sales Company ("Central WVA Energy"), the Agent shall have
confirmed in writing to Borrower and the Servicer that the Agent has
received (a) UCC search reports showing filings in West Virginia through
a date no later than two weeks prior to the date of the opinion referred
to in subclause (b) hereof, and (b) an opinion (in form and substance
satisfactory to the Agent) of Hunton & Xxxxxxxx confirming that such UCC
search reports set forth the proper filing office and the proper debtor
necessary to identify those persons who under the West Virginia UCC have
on file financing statements against Central WVA Energy covering such
Receivables and the proceeds thereof as of the date of such reports and
that such search reports identify no secured party who has filed a
financing statement naming Central WVA Energy, as debtor and describing
such Receivables and the proceeds thereof and confirming that the
security interest opinion
I-7
delivered by Hunton & Xxxxxxxx on the Closing Date with respect to
priority of the Agent, on behalf of the Secured Parties, in such
Receivables and the proceeds thereof,
(v) which by its terms is due and payable (x) within 30 days
of the original billing date therefor and has not had its payment terms
extended more than once, (y) on or before the 25th day of the month
immediately following the month in which the sale or shipment from which
such Receivable arises occurred, or (z) subject to the Extended Term
Concentration Limit, to the extent not covered by (x) or (y), between 30
and 66 days of the original billing date therefor,
(vi) which is an "account," "payment intangible," or "chattel
paper" within the meaning of Section 9-102(a)(2) and Section
9-102(a)(11), respectively, of the UCC of all applicable jurisdictions,
(vii) which is denominated and payable only in United States
dollars in the United States,
(viii) which arises under a Contract which, together with such
Receivable, is in full force and effect and constitutes the legal, valid
and binding obligation of the related Obligor enforceable against such
Obligor in accordance with its terms subject to no offset, counterclaim
or other defense,
(ix) which arises under a Contract which (A) does not contain
an enforceable provision requiring the Obligor under such Contract to
consent to the transfer, sale, pledge or assignment of the rights and
duties of the applicable Originator or any of its assignees under such
Contract and (B) does not contain an enforceable confidentiality
provision that purports to restrict the ability of any Lender to
exercise its rights under this Agreement, including, without limitation,
its right to review the Contract,
(x) which arises under a Contract that contains an
obligation to pay a specified sum of money, contingent only upon the
sale of goods or the provision of services by the applicable Originator,
(xi) which, together with the Contract related thereto, does
not contravene any law, rule or regulation applicable thereto
(including, without limitation, any law, rule and regulation relating to
truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy) and with
respect to which no part of the Contract related thereto is in violation
of any such law, rule or regulation, except where such contravention or
violation could not reasonably be expected to have a Material Adverse
Effect,
(xii) which satisfies all applicable requirements of the
Credit and Collection Policy,
(xiii) which was generated in the ordinary course of the
applicable Originator's business,
I-8
(xiv) which arises solely from the sale of goods or the
provision of services to the related Obligor by the applicable
Originator, and not by any other Person (in whole or in part),
(xv) as to which the Agent, in the exercise of its reasonable
credit judgment, has not provided Borrower with (A) in the case of any
such decision affecting, based upon the preceding Monthly Report, up to
$2 million in aggregate Outstanding Balance of Eligible Receivables, at
least ten (10) Business Days prior written notice, (B) in the case of
any such decision affecting, based upon the preceding Monthly Report,
more than $2 million and up to $10 million in aggregate Outstanding
Balance of Eligible Receivables, at least thirty (30) days prior written
notice and (C) in the case of any such decision affecting, based upon
the preceding Monthly Report, more than $10 million in aggregate
Outstanding Balance of Eligible Receivables, at least ninety (90) days
prior written notice, that the Agent has determined that such Receivable
or class of Receivables is not acceptable as an Eligible Receivable,
including, without limitation, because such Receivable arises under a
Contract that is not acceptable to the Agent,
(xvi) which is not subject to any dispute, counterclaim, right
of rescission, set-off, counterclaim or any other defense (including
defenses arising out of violations of usury laws) of the applicable
Obligor against the applicable Originator or any other Adverse Claim,
and the Obligor thereon holds no right as against such Originator to
cause such Originator to repurchase the goods or merchandise the sale of
which shall have given rise to such Receivable (except with respect to
sale discounts effected pursuant to the Contract, or defective goods
returned in accordance with the terms of the Contract); provided,
however, that if such dispute, offset, counterclaim or defense affects
only a portion of the Outstanding Balance of such Receivable, then such
Receivable may be deemed an Eligible Receivable to the extent of the
portion of such Outstanding Balance which is not so affected, and
provided, further, that Receivables of any Obligor which has any
accounts payable by the applicable Originator or by a wholly-owned
Subsidiary of such Originator (thus giving rise to a potential offset
against such Receivables) may be treated as Eligible Receivables to the
extent that the Obligor of such Receivables has agreed pursuant to a
written agreement in form and substance satisfactory to the Agent, that
such Receivables shall not be subject to such offset,
(xvii) as to which the applicable Originator has satisfied and
fully performed all obligations on its part with respect to such
Receivable required to be fulfilled by it, and no further action is
required to be performed by any Person with respect thereto other than
payment thereon by the applicable Obligor,
(xviii) as to which each of the representations and warranties
contained in Sections 5.1(i), (j), (r), (s), (t) and (u) is true and
correct,
(xix) all right, title and interest to and in which has been
validly transferred by the applicable Originator directly to Borrower
under and in accordance with the Receivables Sale Agreement, and
Borrower has good and marketable title thereto free and clear of any
Adverse Claim
I-9
(xx) [reserved],
(xxi) if such Receivable is a Synfuel Receivable, the amount
of such Receivable that constitutes an Eligible Receivable shall be net
of any amounts owed to Synfuel, and
(xxii) if such Receivable is an Eligible Stockpile Receivable
the Originator thereof or the Servicer has received (and the Servicer
has delivered a copy thereof to the Agent) from the related Obligor the
most recent monthly Burn Accrual Report.
Eligible Stockpile Receivable: Any Receivable that arises upon the delivery by
an Originator of coal or other fuel to a stockpile maintained for the related
Obligor, as to which coal or other fuel the ownership thereof is retained by the
related Originator until such time as such coal or other fuel is used by the
related Obligor and with respect to which use by the related Obligor, the
related Obligor is obligated to deliver to the related Originator or the
Servicer at least once each calendar month a Burn Accrual Report.
Eligible Stockpile Receivable Concentration Limit: At any time, 25.0%.
Environmental Laws: Any and all federal, state, local and foreign statutes,
laws, regulations, ordinances, rules, judgments, orders, decrees, permits,
concessions, grants, franchises, licenses, agreements or other governmental
restrictions relating to the environment, to emissions, discharges or releases
of Contaminants into the environment, including, without limitation, ambient
air, surface water, groundwater, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Contaminants, or to Remedial Action.
Environmental Liabilities and Costs: With respect to any Person, all
liabilities, obligations, responsibilities, Remedial Actions, losses, damages,
punitive damages, consequential damages, treble damages, costs and expenses
(including all fees, disbursements and expenses of counsel, experts and
consultants and costs of investigation and feasibility studies), fines,
penalties, sanctions and interest incurred as a result of any claim or demand by
any other Person, whether based in contract, tort, implied or express warranty,
strict liability, criminal or civil statute and whether arising under any
Environmental Law, Permit, order or agreement with any Governmental Authority or
other Person, in each case relating to any environmental, health or safety
condition or to any Release or threatened Release and resulting from the past,
present or future operations of, or ownership of property by, such Person or any
of its Subsidiaries.
Environmental Lien: Any Lien in favor of any Governmental Authority for
Environmental Liabilities and Costs.
ERISA: The Employee Retirement Income Security Act of 1974, as amended from
time to time, and any rule or regulation issued thereunder.
ERISA Affiliate: Any trade or business (whether or not incorporated) under
common control with Performance Guarantor within the meaning of Section 414(b)
or (c) of the Tax Code (and Sections 414(m) and (o) of the Tax Code for purposes
of provisions relating to Section 412 of the Tax Code).
I-10
Event of Bankruptcy: Shall be deemed to have occurred with respect to a Person
if either:
(i) 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
(ii) 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 (other than a trustee under a
deed of trust, indenture or similar instrument), 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 be adjudicated insolvent, 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.
Excess Availability: As of any date of determination, prior to the occurrence of
an Unmatured Amortization Event, an Amortization Event of the Facility
Termination Date, and provided that on such day all of the conditions precedent
set forth in Section 6.2 hereof are satisfied, the amount (if any) by which the
Borrowing Base exceeds the Aggregate Principal.
Excluded Taxes: All taxed referred to in Section 10.1(iii), excluding those
referred to in the proviso clause of such section.
Extended Term Receivable: Any Receivable which by its terms is due and payable
between 30 and 66 days of the original billing date therefor and is not a
Receivable described in subclauses (x) or (y) of clause (v) of the definition of
Eligible Receivable.
Extended Term Concentration Limit: At any time, 6%.
Facility Account: Borrower's account no. 2000014795736 at Wachovia (or First
Union National Bank).
Facility Termination Date: The earliest of (i) the Liquidity Termination Date,
(ii) the Amortization Date and (iii) July 30, 2004.
Federal Bankruptcy Code: Title 11 of the United States Code entitled
"Bankruptcy," as amended and any successor statute thereto.
I-11
Federal Funds Effective Rate: For any period, a fluctuating interest rate per
annum for each day during such period equal 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 preceding Business Day) by the
Federal Reserve Bank of New York in the Composite Closing Quotations for U.S.
Government Securities; or (ii) if such rate is not so published for any day
which is a Business Day, the average of the quotations at approximately 11:30
a.m. (New York time) for such day on such transactions received by the Agent
from three federal funds brokers of recognized standing selected by it.
Fee Letter: That certain letter agreement dated as of the date hereof among
Borrower, Performance Guarantor and the Agent, as it may be amended or modified
and in effect from time to time.
Final Payout Date: The date on which all Obligations have been paid in full and
the Aggregate Commitment has been terminated.
Finance Charges: With respect to a Contract, any finance, interest, late
payment charges or similar charges owing by an Obligor pursuant to such
Contract.
Funding Agreement: (i) this Agreement, (ii) the Liquidity Agreement and (iii)
any other agreement or instrument executed by any Funding Source with or for the
benefit of Blue Ridge.
Funding Source: (i) any Liquidity Bank or (ii) any insurance company, bank or
other funding entity providing liquidity, credit enhancement or back-up purchase
support or facilities to Blue Ridge.
GAAP: At any time, generally accepted accounting principles in effect in the
United States of America at such time.
Governmental Authority: Any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.
Indebtedness: Of a Person means such Person's (i) obligations for borrowed
money, (ii) obligations representing the deferred purchase price of property or
services (other than accounts payable arising in the ordinary course of such
Person's business payable on terms customary in the trade), (iii) obligations,
whether or not assumed, secured by liens or payable out of the proceeds or
production from property now or hereafter owned or acquired by such Person, (iv)
obligations which are evidenced by notes, acceptances, or other instruments, (v)
capitalized lease obligations, (vi) net liabilities under interest rate swap,
exchange or cap agreements, and (vii) Contingent Obligations.
Independent Director: A member of the Board of Directors of Borrower who is not
at such time, and has not been at any time during the preceding five (5) years:
(i) a creditor, supplier, director, officer, employee, family member, manager or
contractor of A.T. Xxxxxx, Performance Guarantor, any Originator or any of their
respective Subsidiaries or Affiliates (other than Borrower), (ii) a direct or
indirect or beneficial owner, excluding de minimus ownership
I-12
interests, (at the time of such individual's appointment as an Independent
Director or at any time thereafter while serving as an Independent Director) of
any of the outstanding common shares of Borrower, A.T. Xxxxxx, Performance
Guarantor, any Originator, or any of their respective Subsidiaries or
Affiliates, having general voting rights, or (iii) a person who controls
(whether directly, indirectly or otherwise) A.T. Xxxxxx, Performance Guarantor,
any Originator or any of their respective Subsidiaries or Affiliates (other than
Borrower) or any creditor, supplier, employee, officer, director, manager or
contractor of A.T. Xxxxxx, Performance Guarantor, any Originator or any of their
respective Subsidiaries or Affiliates (other than Borrower).
Intercreditor Agreement: That certain Intercreditor Agreement, dated as of the
date hereof, by and between the Agent and Citicorp USA, Inc. in its capacity as
collateral agent (the "Collateral Agent") for the financial institutions from
time to time party to the Credit Agreements and relating to, among other things,
the pledge by Xxxxxx Coal Sales Co., Inc. of its interest in the capital stock
of Borrower to the Collateral Agent, as it may be amended or modified and in
effect from time to time.
Interest: For each respective Interest Period relating to Loans of the Liquidity
Banks, an amount equal to the product of the applicable Interest Rate for each
Loan multiplied by the principal of such Loan for each day elapsed during such
Interest Period, annualized on a 360 day basis.
Interest Period: With respect to any Loan held by a Liquidity Bank:
(i) if Interest for such Loan is calculated on the basis of
the LIBO Rate, a period of one, two, three or six \ months, or such
other period as may be mutually agreeable to the Agent and Borrower,
commencing on a Business Day selected by Borrower or the Agent pursuant
to this Agreement. Such Interest Period shall end on the day in the
applicable succeeding calendar month which corresponds numerically to
the beginning day of such Interest Period, provided, however, that if
there is no such numerically corresponding day in such succeeding month,
such Interest Period shall end on the last Business Day of such
succeeding month; or
(ii) if Interest for such Loan is calculated on the basis of
the Alternate Base Rate, a period commencing on a Business Day selected
by Borrower and agreed to by the Agent, provided that no such period
shall exceed one month.
If any Interest Period would end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, provided,
however, that in the case of Interest Periods corresponding to the LIBO Rate, if
such next succeeding Business Day falls in a new month, such Interest Period
shall end on the immediately preceding Business Day. In the case of any Interest
Period for any Loan which commences before the Amortization Date and would
otherwise end on a date occurring after the Amortization Date, such Interest
Period shall end on the Amortization Date. The duration of each Interest Period
which commences after the Amortization Date shall be of such duration as
selected by the Agent.
Interest Rate: With respect to each Loan of the Liquidity Banks, the LIBO Rate,
the Alternate Base Rate or the Default Rate, as applicable.
I-13
Interest Reserve: For any Calculation Period, the product (expressed as a
percentage) of (i) 1.5 times (ii) the Alternate Base Rate as of the immediately
preceding Cut-Off Date times (iii) a fraction the numerator of which is the
highest Days Sales Outstanding for the most recent 12 Calculation Periods and
the denominator of which is 360.
Lender: Blue Ridge and each Liquidity Bank.
LIBO Rate: For any Interest Period, the rate per annum determined on the basis
of the offered rate for deposits in U.S. dollars of amounts equal or comparable
to the principal amount of the related Loan offered for a term comparable to
such Interest Period, which rates appear on a Bloomberg L.P. terminal, displayed
under the address "US0001M *Index** Q *Go**" effective as of 11:00 A.M., London
time, two Business Days prior to the first day of such Interest Period, provided
that if no such offered rates appear on such page, the LIBO Rate for such
Interest Period will be the arithmetic average (rounded upwards, if necessary,
to the next higher 1/100th of 1%) of rates quoted by not less than two major
banks in New York, New York, selected by the Agent, at approximately 10:00
a.m.(New York time), two Business Days prior to the first day of such Interest
Period, for deposits in U.S. dollars offered by leading European banks for a
period comparable to such Interest Period in an amount comparable to the
principal amount of such Loan, divided by (i) one minus the maximum aggregate
reserve requirement (including all basic, supplemental, marginal or other
reserves) which is imposed against the Agent in respect of Eurocurrency
liabilities, as defined in Regulation D of the Board of Governors of the Federal
Reserve System as in effect from time to time (expressed as a decimal),
applicable to such Interest Period plus (ii) the Applicable Margin. The LIBO
Rate shall be rounded, if necessary, to the next higher 1/16 of 1%.
LIBO Rate Loan: A Loan which bears interest at the LIBO Rate.
Lien: With respect to any asset, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such asset.
Liquidity Agreement: That certain Liquidity Purchase Agreement, dated the date
hereof, by and among Blue Ridge, the financial institutions from time to time
party thereto and Wachovia Bank, National Association, as the same may be
amended, modified, waived and/or restated.
Liquidity Banks: As defined in the preamble in this Agreement.
Liquidity Commitment: As to each Liquidity Bank, its commitment under the
Liquidity Agreement (which shall equal 102% of its Commitment hereunder).
Liquidity Funding: (i) a purchase made by any Liquidity Bank pursuant to its
Liquidity Commitment of all or any portion of, or any undivided interest in, a
Blue Ridge Loan, or (ii) any Loan made by a Liquidity Bank in lieu of Blue Ridge
pursuant to Section 1.1.
I-14
Liquidity Termination Date: The earlier to occur of the following:
(i) the date on which the Liquidity Banks' Liquidity
Commitments expire (which expiration date, as of the Closing Date, is
scheduled to occur on July 30, 2004), cease to be available to Blue
Ridge or otherwise cease to be in full force and effect; or
(ii) the date on which a Downgrading Event with respect to a
Liquidity Bank shall have occurred and been continuing for not less than
30 days, and either (A) the Downgraded Liquidity Bank shall not have
been replaced by an Eligible Assignee pursuant to the Liquidity
Agreement, or (B) the Liquidity Commitment of such Downgraded Liquidity
Bank shall not have been funded or collateralized in such a manner that
will avoid a reduction in or withdrawal of the credit rating applied to
the Commercial Paper to which such Liquidity Agreement applies by any of
the rating agencies then rating such Commercial Paper.
Loan: Any loan made by a Lender to Borrower pursuant to this Agreement
(including, without limitation, any Liquidity Funding). Each Loan shall either
be a CP Rate Loan, an Alternate Base Rate Loan or a Eurodollar Rate Loan,
selected in accordance with the terms of this Agreement.
Loan Parties: As defined in the preamble to this Agreement.
Lock-Box: Each locked postal box with respect to which a bank who has executed a
Collection Account Agreement has been granted exclusive access for the purpose
of retrieving and processing payments made on the Receivables and which is
listed on Exhibit IV.
Loss Reserve: For any Calculation Period, the product (expressed as a
percentage) of (i) 2.0, times (ii) the highest three-month rolling average
Default Ratio during the 12 Calculation Periods ending on the immediately
preceding Cut-Off Date, times (iii) the Default Horizon Ratio as of the
immediately preceding Cut-Off Date.
Material Adverse Effect: A material adverse effect on (i) the financial
condition or operations of any Loan Party and its Subsidiaries, taken as a
whole, (ii) the ability of any Loan Party to perform its obligations under this
Agreement or the Performance Guarantor to perform its obligations under the
Performance Undertaking, (iii) the legality, validity or enforceability of this
Agreement or any other Transaction Document, (iv) the Agent's security interest,
for the benefit of the Secured Parties, in the Receivables generally or in any
significant portion of the Receivables, the Related Security or the Collections
with respect thereto, or (v) the collectibility of the Receivables generally or
of any material portion of the Receivables.
Material Indebtedness: As defined in Section 9.1(f).
Monthly Report: A report, in substantially the form of Exhibit IX hereto
(appropriately completed), furnished by the Servicer to the Agent pursuant to
Section 8.5.
Monthly Reporting Date: The 15th day of each month after the date of this
Agreement (or if any such day is not a Business Day, the next succeeding
Business Day thereafter).
Moody's: Xxxxx'x Investors Service, Inc.
I-15
Multiemployer Plan: As defined in Sections 4201 et seq. of ERISA.
Net Pool Balance: At any time, the aggregate Outstanding Balance of all Eligible
Receivables at such time reduced by the sum of (i) the aggregate amount by which
the Outstanding Balance of all Eligible Receivables of each Obligor and its
Affiliates exceeds the Obligor Concentration Limit for such Obligor, (ii) the
aggregate amount by which the Outstanding Balance of all Eligible Stockpile
Receivables that are Eligible Receivables exceeds the Eligible Stockpile
Receivable Concentration Limit, (iii) the aggregate amount by which the
Outstanding Balance of all Quality Accrual Receivables that are Eligible
Receivables exceeds the Quality Accrual Receivables Concentration Limit, and
(iv) the aggregate amount by which the Outstanding Balance of all Extended Term
Receivables that are Eligible Receivables exceeds the Extended Term
Concentration Limit.
Net Worth: As defined in the Receivables Sale Agreement.
Obligations: As defined in Section 2.1.
Obligor: A Person obligated to make payments pursuant to a Contract.
Obligor Concentration Limit: At any time, in relation to the aggregate
Outstanding Balance of Receivables owed by any single Obligor and its Affiliates
(if any), the applicable concentration limit shall be determined as follows for
Obligors who have short term unsecured debt ratings currently assigned to them
by S&P and Moody's (or in the absence thereof, the equivalent long term
unsecured senior debt ratings), the applicable concentration limit shall be
determined according to the following table:
Allowable % of Eligible
S&P Rating Xxxxx'x Rating Receivables
-------------------------------------------------------------------------------------------
A-1+ P-1 12%
-------------------------------------------------------------------------------------------
A-1 P-1 12%
-------------------------------------------------------------------------------------------
A-2 P-2 10%
-------------------------------------------------------------------------------------------
A-3 P-3 5%
-------------------------------------------------------------------------------------------
Below A-3 or Not Rated by either Below P-3 or Not Rated by
S&P or Moody's either S&P or Moody's 3.25%
-------------------------------------------------------------------------------------------
; provided, however, that (i) if any Obligor has a split rating, the applicable
rating will be the lower of the two, (ii) if any Obligor is not rated by either
S&P or Moody's, the applicable Obligor Concentration Limit shall be the one set
forth in the last line of the table above, and (iii) subject to satisfaction of
the Rating Agency Condition and/or an increase in the percentage set forth in
clause (a)(i) of the definition of "Required Reserve," upon Borrower's request
from time to time, the Agent may agree to a higher percentage of Eligible
Receivables for a particular Obligor and its Affiliates (each such higher
percentage, a "Special Concentration Limit"), it being understood that any
Special Concentration Limit may be cancelled by the Agent upon not less than
five (5) Business Days' written notice to the Loan Parties.
I-16
Originator: Each of Xxxxxx Coal Sales Company, Inc., Central West Virginia
Energy Company and Central Penn Energy Company, Inc., in its capacity as a
seller under the Receivables Sale Agreement.
Outstanding Balance: Of any Receivable at any time means the then outstanding
principal balance thereof. Participant: As defined in Section 12.2.
PBGC: The Pension Benefit Guaranty Corporation, or any successor thereto.
Pension Plan: A pension plan (as defined in Section 3(2) of ERISA) subject to
Title IV of ERISA which Performance Guarantor sponsors or maintains, or to which
it makes, is making, or is obligated to make contributions, or in the case of a
multiple employer plan (as described in Section 4064(a) of ERISA) has made
contributions at any time during the immediately preceding five plan years.
Performance Guarantor: Xxxxxx Energy Company.
Performance Undertaking: That certain Performance Undertaking, dated as of the
date hereof, by Performance Guarantor in favor of Borrower, substantially in the
form of Exhibit XI, as the same may be amended, restated or otherwise modified
from time to time.
Permit: Any permit, approval, authorization, license, variance or permission
required from a Governmental Authority under an applicable Requirement of Law.
Person: An individual, partnership, corporation (including a business trust),
limited liability company, joint stock company, trust, unincorporated
association, joint venture or other entity, or a government or any political
subdivision or agency thereof.
Plan: At any time, an employee pension benefit plan, other than a Multiemployer
Plan, which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code and is either (i) maintained by the
Performance Guarantor or any of its Subsidiaries for employees of the
Performance Guarantor or any of its Subsidiaries or (ii) maintained pursuant to
a collective bargaining agreement or any other arrangement under which more than
one employer, at least one of which is not a member of the Controlled Group,
makes contributions and to which the Performance Guarantor or any of its
Subsidiaries is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions.
Pooled Commercial Paper: Commercial Paper notes of Blue Ridge subject to any
particular pooling arrangement by Blue Ridge, but excluding Commercial Paper
issued by Blue Ridge for a tenor and in an amount specifically requested by any
Person in connection with any agreement effected by Blue Ridge.
Prime Rate: A rate per annum equal to the prime rate of interest announced from
time to time by Wachovia (which is not necessarily the lowest rate charged to
any customer), changing when and as said prime rate changes.
I-17
Pro Rata Share: For each Liquidity Bank, a percentage equal to the Commitment of
such Liquidity Bank, divided by the Aggregate Commitment.
Proposed Reduction Date: As defined in Section 1.3.
Purchasing Liquidity Bank: As defined in Section 12.1(b).
Quality Accrual Receivable: Any Receivable as to which the related Originator
has accrued any debit or credit on its internal accounting system for any
increase or decrease in the quality of the goods shipped that give rise to such
Receivable, which increase or decrease in quality is in relation to the quality
requirements of the related Contract.
Quality Accrual Receivable Concentration Limit: At any time, 2.50%.
Rating Agency Condition: That Blue Ridge has received written notice from S&P
and Moody's that an amendment, a change or a waiver will not result in a
withdrawal or downgrade of the then current ratings on Blue Ridge's Commercial
Paper.
Receivable: All indebtedness and other obligations owed to Borrower or any
Originator (whether now owned or hereafter arising through and including the
Termination Date, at the times such indebtedness or other obligation arises and
before giving effect to any transfer or conveyance under the Receivables Sale
Agreement) or in which Borrower or an Originator has a security interest or
other interest (whether now existing or hereafter arising through and including
the Termination Date), including, without limitation, any indebtedness,
obligation or interest constituting an account, chattel paper, instrument or
general intangible, arising in connection with the sale of goods or the
rendering of services by an Originator, relating to coal, synfuels or other fuel
and further includes, without limitation, (i) the obligation to pay any Finance
Charges with respect thereto, and (ii) all Xxxxxxx Receivables, but excluding in
all cases any Reconveyed Receivable. Indebtedness and other rights and
obligations arising from any one transaction, including, without limitation,
indebtedness and other rights and obligations represented by an individual
invoice, shall constitute a Receivable separate from a Receivable consisting of
the indebtedness and other rights and obligations arising from any other
transaction; provided, that any indebtedness, rights or obligations referred to
in the immediately preceding sentence shall be a Receivable regardless of
whether the account debtor or Borrower treats such indebtedness, rights or
obligations as a separate payment obligation.
Receivables Sale Agreement: That certain Receivables Sale Agreement, dated as of
the date hereof, among the Originators and Borrower, as the same may be amended,
restated or otherwise modified from time to time.
Reconveyed Receivable: Any Receivable transferred by an Originator to Borrower
under the Receivables Sale Agreement, that (a) subsequent to such transfer (i)
becomes subject to any event described in Section 1.4 of the Receivables Sale
Agreement and (ii) the full Outstanding Balance thereof is received by Borrower
as a Purchase Price Credit (as defined in the Receivables Sale Agreement) or in
cash from such Originator as provided for in the Receivables Sale Agreement, and
(b) following the satisfaction of the conditions described in clause (a) of this
definition, is identified in the Monthly Report next following such event and
payment as a Reconveyed Receivable.
I-18
Records: With respect to any Receivable, all Contracts and other documents,
books, records and other information (including, without limitation, computer
programs, tapes, disks, punch cards, data processing software and related
property and rights) relating to such Receivable, any Related Security therefor
and the related Obligor.
Reduction Notice: As defined in Section 1.3.
Regulatory Change: As defined in Section 10.2(a).
Related Security: All of Borrower's right, title and interest in, to and under
the Performance Undertaking and with respect to any
Receivable:
(i) all of Borrower's interest in the inventory and goods
(including returned or repossessed inventory or goods), if any, the sale
of which by an Originator gave rise to such Receivable, and all
insurance contracts with respect thereto,
(ii) all other security interests or liens and property
subject thereto from time to time, if any, purporting to secure payment
of such Receivable, whether pursuant to the Contract related to such
Receivable or otherwise, together with all financing statements 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 related to such Receivable or otherwise,
(iv) all service contracts and other contracts and agreements
associated with such Receivable,
(v) all Records related to such Receivable,
(vi) all of Borrower's right, title and interest in, to and
under the Receivables Sale Agreement in respect of such Receivable, and
(vii) all proceeds of any of the foregoing.
Release: With respect to any Person, any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration, in each case, of any Contaminant into the environment or into or out
of any property owned by such Person, including the movement of Contaminants
through or in the air, soil, surface water, ground water or property.
Release Agreement: The Payment Direction and Partial Release Agreement, dated as
of January 31, 2003 by and among each of the Originators, Borrower, Citicorp
USA, Inc. and Wachovia, as it may be amended or modified and in effect from time
to time.
Remedial Action: All actions required to (a) clean up, remove, treat or in any
other way address the Release of any Contaminant into the environment, (b)
prevent the Release or threat of Release or minimize the further Release so that
a Contaminant does not migrate or endanger or
I-19
threaten to endanger public health or the environment or (c) perform
pre-remedial studies and investigations and post-remedial monitoring and care.
Required Capital Amount: As defined in the Receivables Sale Agreement.
Required Liquidity Banks: At any time, Liquidity Banks with Commitments in
excess of 66-2/3% of the Aggregate Commitment.
Required Notice Period: Two (2) Business Days.
Required Reserve: On any day during a Calculation Period, the product of (i) the
greater of (A) the Required Reserve Factor Floor and (B) the sum of the Loss
Reserve, the Interest Reserve, the Dilution Reserve and the Servicing Reserve,
and (ii) the Net Pool Balance as of the Cut-Off Date immediately preceding such
Calculation Period.
Required Reserve Factor Floor: For any Calculation Period, the sum (expressed as
a percentage) of (i) 13% plus (ii) the product of the Adjusted Dilution Ratio
and the Dilution Horizon Ratio, in each case, as of the immediately preceding
Cut-Off Date.
Requirement of Law: With respect to any Person, the common law and all federal,
state, local and foreign laws, rules and regulations, orders, judgments, decrees
and other legal requirements or determinations of any Governmental Authority or
arbitrator, applicable to or binding upon such Person or any of its property or
to which such Person or any of its property is subject.
Responsible Officer: With respect to any Person, any Authorized Officer of such
Person and any executive officer of such Person, including, without limitation,
any controller, assistant controller, vice president of tax, general counsel,
treasurer and assistant treasurer.
Restricted Junior Payment: (i) any dividend or other distribution, direct or
indirect, on account of any shares of any class of capital stock of Borrower now
or hereafter outstanding, except a dividend payable solely in shares of that
class of stock or in any junior class of stock of Borrower, (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of capital stock of
Borrower now or hereafter outstanding, (iii) any payment or prepayment of
principal of, premium, if any, or interest, fees or other charges on or with
respect to, and any redemption, purchase, retirement, defeasance, sinking fund
or similar payment and any claim for rescission with respect to the Subordinated
Loans, (iv) any payment made to redeem, purchase, repurchase or retire, or to
obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of capital stock of Borrower now or hereafter
outstanding, and (v) any payment of management fees by Borrower (except for
reasonable management fees to any Originator or its Affiliates in reimbursement
of actual management services performed).
S&P: Standard and Poor's Ratings Services, a division of The McGraw Hill
Companies, Inc.
Secured Parties: The Indemnified Parties.
Servicer: At any time the Person (which may be the Agent) then authorized
pursuant to Article VIII to service, administer and collect Receivables.
I-20
Servicing Fee: For each day in a Calculation Period:
(i) an amount equal to (A) the Servicing Fee Rate (or, at
any time while A.T. Xxxxxx or one of its Affiliates is the Servicer,
such lesser percentage as may be agreed between Borrower and the
Servicer on an arms' length basis based on then prevailing market terms
for similar services), times (B) the aggregate Outstanding Balance of
all Receivables at the close of business on the Cut-Off Date immediately
preceding such Calculation Period, times (C) 1/360; or
(ii) on and after the Servicer's reasonable request made at
any time when A.T. Xxxxxx or one of its Affiliates is no longer acting
as Servicer hereunder, an alternative amount specified by the successor
Servicer not exceeding (A) 110% of such Servicer's reasonable costs and
expenses of performing its obligations under this Agreement during the
preceding Calculation Period, divided by (B) the number of days in the
current Calculation Period.
Servicing Fee Rate: 1.0% per annum.
Servicing Reserve: For any Calculation Period, the product (expressed as a
percentage) of (i) the Servicing Fee Rate, times (ii) a fraction, the numerator
of which is the highest Days Sales Outstanding for the most recent 12
Calculation Periods and the denominator of which is 360.
Settlement Date: (i) the 2nd Business Day after each Monthly Reporting Date, and
(ii) the last day of the relevant Interest Period in respect of each Loan of the
Liquidity Banks.
Settlement Period: (i) in respect of each Loan of Blue Ridge, the immediately
preceding Calculation Period, and (ii) in respect of each Loan of the Liquidity
Banks, the entire Interest Period of such Loan.
Subsidiary: Of a Person means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned or controlled by the Performance
Guarantor or one or more Subsidiaries, or by the Performance Guarantor and one
or more Subsidiaries.
Synfuel: Appalachian Synfuels, LLC
Synfuel Receivable: Any Receivable that includes an amount billed to the related
Obligor that is due and owing to Synfuel.
Tax Code: The Internal Revenue Code of 1986, as the same may be amended from
time to time.
Taxes: All taxes other than Excluded Taxes.
Termination Date: As defined in the Receivables Sale Agreement.
Terminating Tranche: As defined in Section 4.3(b).
I-21
Transaction Documents: Collectively, this Agreement, each Borrowing Notice, the
Receivables Sale Agreement, each Collection Account Agreement, the Performance
Undertaking, the Fee Letter, the Intercreditor Agreement, the Release Agreement
and all other instruments, documents and agreements executed and delivered in
connection herewith.
UCC: The Uniform Commercial Code as from time to time in effect in the specified
jurisdiction.
Unmatured Amortization Event: An event which, with the passage of time or the
giving of notice, or both, would constitute an Amortization Event.
Wachovia: Wachovia Bank, National Association in its individual capacity.
Withdrawal Liability: Has the meaning set forth in Sections 4201 et seq. of
ERISA.
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 New
York, and not specifically defined herein, are used herein as defined in such
Article 9.
I-22
EXHIBIT II
FORM OF BORROWING NOTICE
----------
[Borrower's Name]
BORROWING NOTICE
dated ______________, 20__
for Borrowing on ________________, 20__
Wachovia Bank, National Association, as Agent
000 Xxxxxxxxx Xxxxxx, X.X., XX-0000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxxxx, Fax No. (000) 000-0000
Ladies and Gentlemen:
Reference is made to the Credit and Security Agreement dated as
of _________, 2003 (as amended, supplemented or otherwise modified from time to
time, the "Credit Agreement") among ___________ (the "Borrower"), _____________,
as initial Servicer, Blue Ridge Asset Funding Corporation, and Wachovia Bank
National Association, individually and as Agent. Capitalized terms defined in
the Credit Agreement are used herein with the same meanings.
1. The [Servicer, on behalf of the] Borrower hereby
certifies, represents and warrants to the Agent and the Lenders that on and as
of the Borrowing Date (as hereinafter defined):
(a) all applicable conditions precedent set forth in Article
VI of the Credit Agreement have been satisfied;
(b) each of its representations and warranties contained in
Section 5.1 of the Credit Agreement will be true and correct, in all material
respects, as if made on and as of the Borrowing Date;
(c) no event will have occurred and is continuing, or would
result from the requested Purchase, that constitutes an Amortization Event or
Unmatured Amortization Event;
(d) the Facility Termination Date has not occurred; and
(e) after giving effect to the Loans comprising the Advance
requested below, the Aggregate Principal will not exceed the Borrowing Limit.
1
2. The [Servicer, on behalf of the] Borrower hereby
requests that Blue Ridge (or their respective Liquidity Banks) make an Advance
on ___________, 20__ (the "Borrowing Date") as follows:
(a) Aggregate Amount of Advance: $_____________.
(b) If the Advance is not funded by Blue Ridge, [Servicer on
behalf of the] Borrower requests that the Liquidity Banks make an Alternate Base
Rate Loan that converts into LIBO Rate Loan with an Interest Period of _____
months on the third Business Day after the Borrowing Date).
3. Please disburse the proceeds of the Loans as follows:
[Apply $________ to payment of principal and interest of
existing Loans due on the Borrowing Date]. [Apply $______ to payment of fees due
on the Borrowing Date]. [Wire transfer $________ to account no. ________ at
___________ Bank, in [city, state], ABA No. __________, Reference: ________].
IN WITNESS WHEREOF, the [Servicer, on behalf of the] Borrower
has caused this Borrowing Request to be executed and delivered as of this ____
day of ___________, _____.
[_______________________, as Servicer,
on behalf of:] ____________., as Borrower
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
2
EXHIBIT III
PLACES OF BUSINESS OF THE LOAN PARTIES; LOCATIONS OF RECORDS;
FEDERAL EMPLOYER IDENTIFICATION NUMBER(S)
EXHIBIT IV
NAMES OF COLLECTION BANKS; LOCK-BOXES & COLLECTION ACCOUNTS
LOCK-BOX RELATED COLLECTION ACCOUNT
-----------------------------------------------------------------------------------------
X.X. Xxx 00000 Name of Current Account Holder: Xxxxxx
Xxxxxxxxx, XX 00000 Coal Sales Company, Inc.
Account Number: 6261-070525
Bank Name: Wachovia Bank, National Association
ABA Number: 000000000
Contact Person: Xx. Xxxxx Xxxxxxx
Contact's Tel: 000-000-0000
Contact's Fax: 000-000-0000
-----------------------------------------------------------------------------------------
None Name of Current Account Holder: Xxxxxx
Coal Sales Company, Inc.
Account Number: 201367459
Bank Name: SunTrust Bank
ABA Number: 000000000
Contact Person: Xx. Xxxx Key
Contact's Tel: 000-000-0000
Contact's Fax: 000-000-0000
-----------------------------------------------------------------------------------------
P.O. Box 640048 Name of Current Account Holder: Xxxxxx
Xxxxxxxxxx, XX 00000-0000 Coal Sales Company, Inc.
Account Number: 0000000000
Bank Name: PNC Bank, National Association
ABA Number: 04000096
Contact Person: Mr. Xxxxxx Xxxxxxx
Contact's Tel: 000-000-0000
Contact's Fax: 000-000-0000
-----------------------------------------------------------------------------------------
None Name of Current Account Holder: Xxxxxx
Coal Sales Company, Inc., d/b/a Xxxxxx
Metallurgical Coal Inc.
Account Number: 201708329
Bank Name: SunTrust Bank
ABA Number: 201367459
Bank Name: SunTrust Bank
ABA Number: 000000000
Contact Person: Xx. Xxxx Key
Contact's Tel: 000-000-0000
Contact's Fax: 000-000-0000
-----------------------------------------------------------------------------------------
P.O. Box 642052 Name of Current Account Holder: Xxxxxx
Xxxxxxxxxx, XX 00000-0000 Coal Sales Company, Inc., d/b/a Xxxxxx
Metallurgical Coal Inc.
Account Number: 00-0000-0000
Bank Name: PNC Bank, National Association
ABA Number: 04000096
Contact Person: Mr. Xxxxxx Xxxxxxx
Contact's Tel: 000-000-0000
Contact's Fax: 000-000-0000
-----------------------------------------------------------------------------------------
P.O. Box 751999 Name of Current Account Holder: d/b/a
Xxxxxxxxx, XX 00000-0000 Central WV Energy Sales
Account Number: 1841247060
Bank Name: Wachovia Bank, National Association
ABA Number: 000000000
Contact Person: Xx. Xxxxx Xxxxxxx
Contact's Tel: 000-000-0000
Contact's Fax: 000-000-0000
-----------------------------------------------------------------------------------------
EXHIBIT V
FORM OF COMPLIANCE CERTIFICATE
To: Wachovia Bank, National Association, as Agent
This Compliance Certificate is furnished pursuant to that certain
Credit and Security Agreement dated as of __________, 2003 among __________ (the
"Borrower"), ____________ (the "Servicer"), the Lenders party thereto and
Wachovia Bank, National Association, as agent for such Lenders (the "Agreement")
and the Performance Undertaking (as defined in the Agreement).
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected [Chief Financial Officer] of the
[Borrower] [Performance Guarantor].
2. I have reviewed the terms of the Agreement [add for Compliance
Certificate of Performance Guarantor: , the Receivables Sale Agreement and the
Performance Undertaking] and I have made, or have caused to be made under my
supervision, a detailed review of the transactions and conditions of Borrower
[add for Compliance Certificate of Performance Guarantor: , the Originators, the
Performance Guarantor] and [its] [their respective] Subsidiaries during the
accounting period covered by the attached financial statements.
3. The examinations described in paragraph 2 did not disclose, and
I have no knowledge of, the existence of any condition or event which
constitutes an Amortization Event or Unmatured Amortization Event, as each such
term is defined under the Agreement, during or at the end of the accounting
period covered by the attached financial statements or as of the date of this
Certificate[, except as set forth in paragraph 6 below].
4. Schedule I attached hereto sets forth financial data and
computations evidencing the compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.
5. I have no knowledge of any relief granted to the prevailing
party in any litigation or proceeding in which a final judgment or order which
is either for the payment of money in an amount equal to or exceeding
$20,000,000 or which grants any non-monetary relief to the prevailing party
therein that was rendered against the Performance Guarantor, any Originator,
Borrower or any of their respective Subsidiaries (whether or not satisfied or
stayed) during the fiscal quarter ended on the date hereof[, except as set forth
in paragraph 7 below].
[6. Described below are the exceptions, if any, to paragraph 3 by
listing, in detail, the nature of the condition or event, the period during
which it has existed and the action which Borrower has taken, is taking, or
proposes to take with respect to each such condition or event:
____________________].
1
[7. Described below are the exceptions, if any, to paragraph 5 by
listing, in detail, the parties, subject matter, nature and amount of relief
granted to the prevailing party:]
[add the following for the Compliance Certificate of Performance
Guarantor: 8.Setting forth on Schedule II are the calculations required to
establish whether the Performance Guarantor was in compliance with the
requirements of Section 6A of the Performance Undertaking on the date of the
attached financial statements.]
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered as of ______________,
20__.
By:
----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
2
SCHEDULE I TO COMPLIANCE CERTIFICATE
A. Schedule of Compliance as of __________, ____ with Section ___
of the Agreement. Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
This schedule relates to the month ended: _______________
3
SCHEDULE II TO COMPLIANCE CERTIFICATE
A. Schedule of Compliance as of __________, ____ with Section ___
of the Agreement. Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
This schedule relates to the month ended: _______________
4
EXHIBIT VI
FORM OF COLLECTION ACCOUNT AGREEMENT
COLLECTION ACCOUNT AGREEMENT
_____________, 2003
[Collection Bank Name]
[Collection Bank Address]
Attn: ____________________
Fax No. (___) ______________
Re: [Name of current Lock-Box owner]/[Borrower's Name]
Ladies and Gentlemen:
Reference is hereby made to each of the [departmental] post office boxes
listed on Schedule 1 hereto (each, a "Lock-Box") of which [Collection Bank
Name], a _________ banking association (hereinafter "you"), has exclusive
control for the purpose of receiving mail and processing payments therefrom
pursuant to the [Lock-Box Service Agreement] dated _______________, originally
by and between _____________ (the "Company") and you (the "Service Agreement").
1. You hereby confirm your agreement to perform the services
described therein. Among the services you have agreed to perform therein, is to
endorse all checks and other evidences of payment received in each of the
Lock-Boxes, and credit such payments to account no. _____________ (the "Lock-Box
Account").
2. The Company hereby informs you that it has transferred to its
affiliate, [Borrower Name], a ____________ [corporation] (the "Borrower") all of
the Company's right, title and interest in and to the items from time to time
received in the Lock-Boxes and/or deposited in the Lock-Box Account, but that
the Company has agreed to continue to service the receivables giving rise to
such items. Accordingly, the Company and Borrower hereby request that the name
of the Lock-Box Account be changed to "[Borrower Name]" Borrower hereby further
advises you that it has pledged the receivables giving rise to such items to a
group of lenders for whom Wachovia Bank, National Association acts as agent (in
such capacity, the "Agent") and has granted a security interest to the Agent in
all of Borrower's right, title and interest in and to the Lock-Box Account and
the funds therein.
3. Each of the Company and Borrower hereby irrevocably instructs
you, and you hereby agree, that upon receiving notice from the Agent in the form
attached hereto as Annex A:
1
(i) the name of the Lock-Box Account will be changed to
"Wachovia Bank, National Association, as Agent" (or any designee of the
Agent), and the Agent will have exclusive ownership of and access to the
Lock-Boxes and the Lock-Box Account, and none of the Company, Borrower,
nor any of their respective affiliates will have any control of the
Lock-Boxes or the Lock-Box Account or any access thereto, (ii) you will
either continue to send the funds from the Lock-Boxes to the Lock-Box
Account, or will redirect the funds as the Agent may otherwise request,
(iii) you will transfer monies on deposit in the Lock-Box Account to the
following account:
Bank Name: Wachovia Bank, National Association
Location: Charlotte, NC
ABA Routing No.: ABA # 000000000
Credit Account No.: For credit to Blue Ridge Asset Funding
Account #2000010384921
Reference: Blue Ridge/[the Seller Name]
Attention: Xxxxxxx X. Xxxxxx, tel. (000) 000-0000
or to such other account as the Agent may specify, (iv) all services to be
performed by you under the Service Agreement will be performed on behalf of the
Agent, and (v) all correspondence or other mail which you have agreed to send to
the Company or Borrower will be sent to the Agent at the following address:
Wachovia Bank, National Association, as Agent
000 Xxxxxxxxx Xxxxxx
Mail Stop GA-8407
Xxxxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxxxxx,
Asset-Backed Finance
FAX: (404) 000- 0000
Moreover, upon such notice, the Agent will have all rights and remedies given to
the Company (and Borrower, as the Company's assignee) under the Service
Agreement. The Company agrees, however, to continue to pay all fees and other
assessments due thereunder at any time.
4. You hereby acknowledge that monies deposited in the Lock-Box
Account or any other account established with you by the Agent for the purpose
of receiving funds from the Lock-Boxes are subject to the liens of the Agent,
and will not be subject to deduction, set-off, banker's lien or any other right
you or any other party may have against the Company or Borrower except that you
may debit the Lock-Box Account for any items deposited therein that are returned
or otherwise not collected and for all charges, fees, commissions and expenses
incurred by you in providing services hereunder, all in accordance with your
customary practices for the charge back of returned items and expenses.
5. You will be liable only for direct damages in the event you fail
to exercise ordinary care. You shall be deemed to have exercised ordinary care
if your action or failure to act is in conformity with general banking usages or
is otherwise a commercially reasonable
2
practice of the banking industry. You shall not be liable for any special,
indirect or consequential damages, even if you have been advised of the
possibility of these damages.
6. The parties acknowledge that you may assign or transfer your
rights and obligations hereunder solely to a wholly-owned subsidiary of [insert
name of Collection Bank's holding company].
7. Borrower agrees to indemnify you for, and hold you harmless
from, all claims, damages, losses, liabilities and expenses, including legal
fees and expenses, resulting from or with respect to this letter agreement and
the administration and maintenance of the Lock-Box Account and the services
provided hereunder, including, without limitation: (a) any action taken, or not
taken, by you in regard thereto in accordance with the terms of this letter
agreement, (b) the breach of any representation or warranty made by Borrower
pursuant to this letter agreement, (c) any item, including, without limitation,
any automated clearinghouse transaction, which is returned for any reason, and
(d) any failure of Borrower to pay any invoice or charge to you for services in
respect to this letter agreement and the Lock-Box Account or any amount owing to
you from Borrower with respect thereto or to the service provided hereunder.
8. THIS LETTER AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER WILL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF _________, WHICH STATE SHALL BE YOUR
"LOCATION" FOR PURPOSES OF THE UNIFORM COMMERCIAL CODE FROM AND AFTER JULY 1,
2001. This letter agreement may be executed in any number of counterparts and
all of such counterparts taken together will be deemed to constitute one and the
same instrument.
9. This letter agreement contains the entire agreement between the
parties, and may not be altered, modified, terminated or amended in any respect,
nor may any right, power or privilege of any party hereunder be waived or
released or discharged, except upon execution by all parties hereto of a written
instrument so providing. In the event that any provision in this letter
agreement is in conflict with, or is inconsistent with, any provision of the
Service Agreement, this letter agreement will exclusively govern and control.
Each party agrees to take all actions reasonably requested by any other party to
carry out the purposes of this letter agreement or to preserve and protect the
rights of each party hereunder.
Please indicate your agreement to the terms of this letter agreement by
signing in the space provided below. This letter agreement will become effective
immediately upon execution of a counterpart of this letter agreement by all
parties hereto.
Very truly yours,
[NAME OF CURRENT LOCK-BOX OWNER]
By:
----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
3
[BORROWER NAME]
By:
----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
Acknowledged and agreed to as of the
date first above written:
[COLLECTION BANK]
By:
----------------------------------
Name:
--------------------------------
Title:
-------------------------------
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent
By:
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Name:
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Title:
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4
ANNEX A
FORM OF NOTICE
[On letterhead of the Agent]
[Date]
[Collection Bank Name]
[Collection Bank Address]
Attn: ____________________
Fax No. (___) ______________
Re: [Name of current Lock-Box owner]/[Borrower Name]
Ladies and Gentlemen:
We hereby notify you that we are exercising our rights pursuant to that
certain letter agreement dated ____________, 2003 (the "Letter Agreement") among
[Name of current Lock-Box Owner], [Borrower Name], you and us, to have the name
of, and to have exclusive ownership and control of, account no. __________
identified in the Letter Agreement (the "Lock-Box Account") maintained with you,
transferred to us. The Lock-Box Account will henceforth be a zero-balance
account, and funds deposited in the Lock-Box Account should be sent at the end
of each day to the account specified in Section 3(i) of the Letter Agreement, or
as otherwise directed by the undersigned. You have further agreed to perform all
other services you are performing under the "Service Agreement" (as defined in
the Letter Agreement) on our behalf.
We appreciate your cooperation in this matter.
Very truly yours,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent
By:
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Name:
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Title:
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5
SCHEDULE 1
LOCK-BOX POST OFFICE ADDRESS
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6
EXHIBIT VII
FORM OF ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT (this "Assignment Agreement") is entered into
as of the ___ day of ____________, ____, by and between _____________________
("Assignor") and __________________ ("Assignee").
PRELIMINARY STATEMENTS
A. This Assignment Agreement is being executed and delivered in
accordance with Section 12.1(b) of that certain Credit and Security Agreement
dated as of __________, 2003 by and among ____________, as Borrower,
___________________, as Servicer, Blue Ridge Asset Funding Corporation, Wachovia
Bank, National Association, as Agent, and the Liquidity Banks party thereto (as
amended, modified or restated from time to time, the "Credit and Security
Agreement") and that certain Liquidity Asset Purchase Agreement dated as of
__________, 2003 by and among Blue Ridge, the Liquidity Banks from time to time
party thereto and Wachovia Bank, National Association, as Agent (as amended,
modified or restated from time to time, the "Liquidity Agreement"). Capitalized
terms used and not otherwise defined herein are used with the meanings set forth
or incorporated by reference in the Credit and Security Agreement.
B. Assignor is a Liquidity Bank party to the Credit and Security
Agreement and the Liquidity Agreement, and Assignee wishes to become a Liquidity
Bank thereunder; and
C. Assignor is selling and assigning to Assignee an undivided
____________% (the "Transferred Percentage") interest in all of Assignor's
rights and obligations under the Transaction Documents and the Liquidity
Agreement, including, without limitation, Assignor's Commitment, Assignor's
Liquidity Commitment and (if applicable) Assignor's Loans as set forth herein.
AGREEMENT
The parties hereto hereby agree as follows:
(1) The sale, transfer and assignment effected by this Assignment
Agreement shall become effective (the "Effective Date") two (2) Business Days
(or such other date selected by the Agent in its sole discretion) following the
date on which a notice substantially in the form of Schedule II to this
Assignment Agreement ("Effective Notice") is delivered by the Agent to Blue
Ridge, Assignor and Assignee. From and after the Effective Date, Assignee shall
be a Liquidity Bank party to the Credit and Security Agreement for all purposes
thereof as if Assignee were an original party thereto and Assignee agrees to be
bound by all of the terms and provisions contained therein.
(2) If Assignor has no outstanding principal under the Credit and
Security Agreement or the Liquidity Agreement, on the Effective Date, Assignor
shall be deemed to have hereby transferred and assigned to Assignee, without
recourse, representation or warranty (except as
1
provided in paragraph 6 below), and the Assignee shall be deemed to have hereby
irrevocably taken, received and assumed from Assignor, the Transferred
Percentage of Assignor's Commitment and Liquidity Commitment and all rights and
obligations associated therewith under the terms of the Credit and Security
Agreement and the Liquidity Agreement, including, without limitation, the
Transferred Percentage of Assignor's future funding obligations under the Credit
and Security Agreement and the Liquidity Agreement.
(3) If Assignor has any outstanding principal under the Credit and
Security Agreement and Liquidity Agreement, at or before 12:00 noon, local time
of Assignor, on the Effective Date Assignee shall pay to Assignor, in
immediately available funds, an amount equal to the sum of (i) the Transferred
Percentage of the outstanding principal of Assignor's Loans and, without
duplication, Assignor's Percentage Interests (as defined in the Liquidity
Agreement) (such amount, being hereinafter referred to as the "Assignee's
Principal"); (ii) all accrued but unpaid (whether or not then due) Interest
attributable to Assignee's Principal; and (iii) accruing but unpaid fees and
other costs and expenses payable in respect of Assignee's Principal for the
period commencing upon each date such unpaid amounts commence accruing, to and
including the Effective Date (the "Assignee's Acquisition Cost"); whereupon,
Assignor shall be deemed to have sold, transferred and assigned to Assignee,
without recourse, representation or warranty (except as provided in paragraph 6
below), and Assignee shall be deemed to have hereby irrevocably taken, received
and assumed from Assignor, the Transferred Percentage of Assignor's Commitment,
Liquidity Commitment, Loans (if applicable) and Percentage Interests (if
applicable) and all related rights and obligations under the Transaction
Documents and the Liquidity Agreement, including, without limitation, the
Transferred Percentage of Assignor's future funding obligations under the Credit
and Security Agreement and the Liquidity Agreement.
(4) Concurrently with the execution and delivery hereof, Assignor
will provide to Assignee copies of all documents requested by Assignee which
were delivered to Assignor pursuant to the Credit and Security Agreement or the
Liquidity Agreement.
(5) Each of the parties to this Assignment Agreement agrees that at
any time and from time to time upon the written request of any other party, it
will execute and deliver such further documents and do such further acts and
things as such other party may reasonably request in order to effect the
purposes of this Assignment Agreement.
(6) By executing and delivering this Assignment Agreement, Assignor
and Assignee confirm to and agree with each other, the Agent and the Liquidity
Banks as follows: (a) other than the representation and warranty that it has not
created any Adverse Claim upon any interest being transferred hereunder,
Assignor makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made by any other
Person in or in connection with any of the Transaction Documents or the
Liquidity Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of Assignee, the Credit and Security
Agreement, the Liquidity Agreement or any other instrument or document furnished
pursuant thereto or the perfection, priority, condition, value or sufficiency of
any Collateral; (b) Assignor makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower, any Obligor,
any Affiliate of Borrower or the performance or observance by Borrower, any
Obligor, any Affiliate of Borrower of any of their
2
respective obligations under the Transaction Documents or any other instrument
or document furnished pursuant thereto or in connection therewith; (c) Assignee
confirms that it has received a copy of each of the Transaction Documents and
the Liquidity Agreement, and other documents and information as it has requested
and deemed appropriate to make its own credit analysis and decision to enter
into this Assignment Agreement; (d) Assignee will, independently and without
reliance upon the Agent, Blue Ridge, Borrower or any other Liquidity Bank or
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in taking or not taking
action under the Transaction Documents and the Liquidity Agreement; (e) Assignee
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under the Transaction Documents and the Liquidity
Agreement as are delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; and (f) Assignee agrees that it
will perform in accordance with their terms all of the obligations which, by the
terms of the Liquidity Agreement, the Credit and Security Agreement and the
other Transaction Documents, are required to be performed by it as a Liquidity
Bank or, when applicable, as a Lender.
(7) Each party hereto represents and warrants to and agrees with the
Agent that it is aware of and will comply with the provisions of the Credit and
Security Agreement, including, without limitation, Sections 14.5 and 14.6
thereof.
(8) Schedule I hereto sets forth the revised Commitment and
Liquidity Commitment of Assignor and the Commitment and Liquidity Commitment of
Assignee, as well as administrative information with respect to Assignee.
(9) THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
(10) Assignee hereby covenants and agrees that, prior to the date
which is one year and one day after the payment in full of all senior
indebtedness for borrowed money of Blue Ridge, it will not institute against, or
join any other Person in instituting against, Blue Ridge any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceeding under the laws of the United States or any state of the
United States.
3
IN WITNESS WHEREOF, the parties hereto have caused this Assignment
Agreement to be executed by their respective duly authorized officers of the
date hereof.
[ASSIGNOR]
By:
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Name:
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Title:
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[ASSIGNEE]
By:
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Name:
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Title:
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4
SCHEDULE I TO ASSIGNMENT AGREEMENT
LIST OF LENDING OFFICES, ADDRESSES
FOR NOTICES AND COMMITMENT AMOUNTS
Date: _____________, ______
Transferred Percentage: ____________%
X-0 X-0 X-0 X-0 C-1 C-2
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Assignor Commitment Commitment Outstanding Ratable Share Liquidity Liquidity
(prior to (after giving principal (if of Outstanding Commitment Commitment
giving effect effect to the any) principal (prior to (after giving
to the Assignment giving effect effect to the
Assignment Agreement) to the Assignment
Agreement) Assignment Agreement)
Agreement)
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X-0 X-0 X-0 X-0 C-1 C-2
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Assignee Commitment Commitment Outstanding Ratable Share Liquidity Liquidity
(prior to (after giving principal (if of Outstanding Commitment Commitment
giving effect effect to the any) principal (prior to (after giving
to the Assignment giving effect effect to the
Assignment Agreement) to the Assignment
Agreement) Assignment Agreement)
Agreement)
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Address for Notices
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Attention:
Phone:
Fax:
5
SCHEDULE II TO ASSIGNMENT AGREEMENT
EFFECTIVE NOTICE
TO: _______________________, Assignor
_______________________
_______________________
_______________________
TO: _______________________, Assignee
_______________________
_______________________
_______________________
The undersigned, as Agent under the Credit and Security Agreement dated
as of ______, ____ by and among ___________, a _________ corporation, _________,
as Servicer, Blue Ridge Asset Funding Corporation, Wachovia Bank, National
Association, as Agent, and the Liquidity Banks party thereto, hereby
acknowledges receipt of executed counterparts of a completed Assignment
Agreement dated as of ____________, 2003 between __________________, as
Assignor, and __________________, as Assignee. Terms defined in such Assignment
Agreement are used herein as therein defined.
1. Pursuant to such Assignment Agreement, you are advised that the
Effective Date will be ______________, ____.
2. Each of the undersigned hereby consents to the Assignment
Agreement as required by Section 12.1(b) of the Credit and Security Agreement.
[3. Pursuant to such Assignment Agreement, the Assignee is required
to pay $____________ to Assignor at or before 12:00 noon (local time of
Assignor) on the Effective Date in immediately available funds.]
Very truly yours,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Agent
By:
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Name:
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Title:
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6
BLUE RIDGE ASSET FUNDING CORPORATION
BY: WACHOVIA BANK, NATIONAL ASSOCIATION,
as attorney-in-fact
By:
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Name:
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Title:
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****[Borrower hereby consents to the foregoing assignment:
[BORROWER]
By:
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Name:
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Title: ]****
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7
EXHIBIT VIII
CREDIT AND COLLECTION POLICY
See Exhibit V to Receivables Sale Agreement
EXHIBIT IX
FORM OF MONTHLY REPORT
[to be provided by Wachovia]
EXHIBIT X
[reserved]
EXHIBIT XI
FORM OF PERFORMANCE UNDERTAKING
This Performance Undertaking (this "Undertaking"), dated as of January
31, 2003, is executed by Xxxxxx Energy Company, a Delaware corporation (the
"Performance Guarantor") in favor of Xxxxxx Receivables Corporation, a Delaware
corporation (together with its successors and assigns, "Recipient").
RECITALS
1. Xxxxxx Coal Sales Company, Inc., Central West Virginia Energy
Company and Central Penn Energy Company, Inc. (collectively, the "Originators"),
and Recipient have entered into a Receivables Sale Agreement, dated as of
January 31, 2003 (as amended, restated or otherwise modified from time to time,
the "Sale Agreement"), pursuant to which Originators, subject to the terms and
conditions contained therein, are selling and/or contributing their respective
right, title and interest in their accounts receivable to Recipient.
2. Performance Guarantor directly or indirectly owns one hundred
percent (100%) of the capital stock of each of the Originators and Recipient,
and each of the Originators, and accordingly, Performance Guarantor, is expected
to receive substantial direct and indirect benefits from their sale or
contribution of receivables to Recipient pursuant to the Sale Agreement (which
benefits are hereby acknowledged).
3. As an inducement for Recipient to acquire Originators' accounts
receivable pursuant to the Sale Agreement, Performance Guarantor has agreed to
guaranty the due and punctual performance by Originators of their obligations
under the Sale Agreement, as well as A.T. Xxxxxx Coal Company, Inc.'s Servicing
Related Obligations (as hereinafter defined).
4. Performance Guarantor wishes to guaranty the due and punctual
performance by Originators of their obligations to Recipient under or in respect
of the Sale Agreement and A.T. Xxxxxx Coal Company, Inc.'s Servicing Related
Obligations (as hereinafter defined), as provided herein.
AGREEMENT
NOW, THEREFORE, Performance Guarantor hereby agrees as follows:
Section 1. Definitions. Capitalized terms used herein and not defined
herein shall the respective meanings assigned thereto in the Sale Agreement or
the Credit and Security Agreement (as hereinafter defined). In addition:
Guaranteed Obligations: Collectively: (i) all covenants, agreements, terms,
conditions and indemnities to be performed and observed by any Originator under
and pursuant to the Sale Agreement and each other document executed and
delivered by any Originator pursuant to the Sale Agreement, including, without
limitation, the due and punctual payment of all sums which
1
are or may become due and owing by any Originator under the Sale Agreement,
whether for fees, expenses (including counsel fees), indemnified amounts or
otherwise, whether upon any termination or for any other reason and (ii) all
obligations of A.T. Xxxxxx Coal Company, Inc., (A) as Servicer under the Credit
and Security Agreement, dated as of January 31, 2003 by and among Recipient, as
Borrower, A.T. Xxxxxx Coal Company, Inc., as Servicer, Blue Ridge Asset Funding
Corporation, the Liquidity Banks and Wachovia Bank, National Association, as
Agent (as amended, restated or otherwise modified, the "Credit and Security
Agreement" and, together with the Sale Agreement, the "Agreements") or (B) which
arise pursuant to Sections 8.2, 8.3 or 14.4(a) of the Credit and Security
Agreement as a result of its termination as Servicer (all such obligations under
this clause (ii), collectively, the "Servicing Related Obligations").
Section 2. Guaranty of Performance of Guaranteed Obligations.
Performance Guarantor hereby guarantees to Recipient, the full and punctual
payment and performance by each Originator of its respective Guaranteed
Obligations. This Undertaking is an absolute, unconditional and continuing
guaranty of the full and punctual performance of all Guaranteed Obligations of
each Originator under the Agreements and each other document executed and
delivered by any Originator pursuant to the Agreements and is in no way
conditioned upon any requirement that Recipient first attempt to collect any
amounts owing by any Originator to Recipient, the Agent or the Lenders from any
other Person or resort to any collateral security, any balance of any deposit
account or credit on the books of Recipient, the Agent or any Lender in favor of
any Originator or any other Person or other means of obtaining payment. Should
any Originator default in the payment or performance of any of its Guaranteed
Obligations, Recipient (or its assigns) may cause the immediate performance by
Performance Guarantor of the Guaranteed Obligations and cause any payment
Guaranteed Obligations to become forthwith due and payable to Recipient (or its
assigns), without demand or notice of any nature (other than as expressly
provided herein), all of which are hereby expressly waived by Performance
Guarantor. Notwithstanding the foregoing, this Undertaking is not a guarantee of
the collection of any of the Receivables and Performance Guarantor shall not be
responsible for any Guaranteed Obligations to the extent the failure to perform
such Guaranteed Obligations by any Originator results from Receivables being
uncollectible on account of the insolvency, bankruptcy or lack of
creditworthiness of the related Obligor; provided that nothing herein shall
relieve any Originator from performing in full its Guaranteed Obligations under
the Agreements or Performance Guarantor of its undertaking hereunder with
respect to the full performance of such duties.
Section 3. Performance Guarantor's Further Agreements to Pay.
Performance Guarantor further agrees, as the principal obligor and not as a
guarantor only, to pay to Recipient (and its assigns), forthwith upon demand in
funds immediately available to Recipient, all reasonable costs and expenses
(including court costs and reasonable legal expenses) incurred or expended by
Recipient in connection with the Guaranteed Obligations, this Undertaking and
the enforcement thereof, together with interest on amounts recoverable under
this Undertaking from the time when such amounts become due until payment, at a
rate of interest (computed for the actual number of days elapsed based on a 360
day year) equal to the Prime Rate plus 2% per annum, such rate of interest
changing when and as the Prime Rate changes.
Section 4. Waivers by Performance Guarantor. Performance Guarantor
waives notice of acceptance of this Undertaking, notice of any action taken or
omitted by Recipient (or its assigns) in reliance on this Undertaking, and any
requirement that Recipient (or its assigns) be
2
diligent or prompt in making demands under this Undertaking, giving notice of
any Termination Event, Amortization Event, other default or omission by any
Originator or asserting any other rights of Recipient under this Undertaking.
Performance Guarantor warrants that it has adequate means to obtain from each
Originator, on a continuing basis, information concerning the financial
condition of such Originator, and that it is not relying on Recipient to provide
such information, now or in the future. Performance Guarantor also irrevocably
waives all defenses (i) that at any time may be available in respect of the
Obligations by virtue of any statute of limitations, valuation, stay, moratorium
law or other similar law now or hereafter in effect or (ii) that arise under the
law of suretyship, including impairment of collateral. Recipient (and its
assigns) shall be at liberty, without giving notice to or obtaining the assent
of Performance Guarantor and without relieving Performance Guarantor of any
liability under this Undertaking, to deal with each Originator and with each
other party who now is or after the date hereof becomes liable in any manner for
any of the Guaranteed Obligations, in such manner as Recipient in its sole
discretion deems fit, and to this end Performance Guarantor agrees that the
validity and enforceability of this Undertaking, including without limitation,
the provisions of Section 7 hereof, shall not be impaired or affected by any of
the following: (a) any extension, modification or renewal of, or indulgence with
respect to, or substitutions for, the Guaranteed Obligations or any part thereof
or any agreement relating thereto at any time; (b) any failure or omission to
enforce any right, power or remedy with respect to the Guaranteed Obligations or
any part thereof or any agreement relating thereto, or any collateral securing
the Guaranteed Obligations or any part thereof; (c) any waiver of any right,
power or remedy or of any Termination Event, Amortization Event, or default with
respect to the Guaranteed Obligations or any part thereof or any agreement
relating thereto; (d) any release, surrender, compromise, settlement, waiver,
subordination or modification, with or without consideration, of any other
obligation of any person or entity with respect to the Guaranteed Obligations or
any part thereof; (e) the enforceability or validity of the Guaranteed
Obligations or any part thereof or the genuineness, enforceability or validity
of any agreement relating thereto or with respect to the Guaranteed Obligations
or any part thereof; (f) the application of payments received from any source to
the payment of any payment Obligations of any Originator or any part thereof or
amounts which are not covered by this Undertaking even though Recipient (or its
assigns) might lawfully have elected to apply such payments to any part or all
of the payment Obligations of such Originator or to amounts which are not
covered by this Undertaking; (g) the existence of any claim, setoff or other
rights which Performance Guarantor may have at any time against any Originator
in connection herewith or any unrelated transaction; (h) any assignment or
transfer of the Guaranteed Obligations or any part thereof; or (i) any failure
on the part of any Originator to perform or comply with any term of the
Agreements or any other document executed in connection therewith or delivered
thereunder, all whether or not Performance Guarantor shall have had notice or
knowledge of any act or omission referred to in the foregoing clauses (a)
through (i) of this Section 4.
Section 5. Unenforceability of Guaranteed Obligations Against
Originators. Notwithstanding (a) any change of ownership of any Originator or
the insolvency, bankruptcy or any other change in the legal status of any
Originator; (b) the change in or the imposition of any law, decree, regulation
or other governmental act which does or might impair, delay or in any way affect
the validity, enforceability or the payment when due of the Guaranteed
Obligations; (c) the failure of any Originator or Performance Guarantor to
maintain in full force, validity or effect or to obtain or renew when required
all governmental and other approvals, licenses or
3
consents required in connection with the Guaranteed Obligations or this
Undertaking, or to take any other action required in connection with the
performance of all obligations pursuant to the Guaranteed Obligations or this
Undertaking; or (d) if any of the moneys included in the Guaranteed Obligations
have become irrecoverable from any Originator for any other reason other than
final payment in full of the payment Obligations in accordance with their terms,
this Undertaking shall nevertheless be binding on Performance Guarantor. This
Undertaking shall be in addition to any other guaranty or other security for the
Guaranteed Obligations, and it shall not be rendered unenforceable by the
invalidity of any such other guaranty or security. In the event that
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of any Originator or
for any other reason with respect to any Originator, all such amounts then due
and owing with respect to the Guaranteed Obligations under the terms of the
Agreements, or any other agreement evidencing, securing or otherwise executed in
connection with the Guaranteed Obligations, shall be immediately due and payable
by Performance Guarantor.
Section 6. Representations and Warranties. Performance Guarantor hereby
represents and warrants to Recipient that:
(a) Existence and Standing. Performance Guarantor is a corporation
duly organized, validly existing and in good standing under the laws of its
state of incorporation. Performance Guarantor is duly qualified to do business
and is in good standing as a foreign corporation, and has and holds all
corporate 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) Authorization, Execution and Delivery; Binding Effect. The
execution and delivery by Performance Guarantor of this Undertaking, and the
performance of its obligations hereunder, are within its corporate powers and
authority and have been duly authorized by all necessary corporate action on its
part. This Undertaking has been duly executed and delivered by Performance
Guarantor. This Undertaking constitutes the legal, valid and binding obligation
of Performance Guarantor enforceable against Performance Guarantor 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).
(c) No Conflict; Government Consent. The execution and delivery by
Performance Guarantor of this Undertaking, and the performance of its
obligations hereunder do not contravene or violate (i) its certificate or
articles of incorporation or by-laws, (ii) any law, rule or regulation
applicable to it, (iii) any restrictions under 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 Performance Guarantor or its Subsidiaries
(except as created hereunder) except, in any case, where such contravention or
violation could not reasonably be expected to have a Material Adverse Effect.
4
(d) Financial Statements. The consolidated financial statements of
Performance Guarantor and its consolidated Subsidiaries dated as of October 31,
2001 and September 30, 2002 heretofore delivered to Recipient have been prepared
in accordance with generally accepted accounting principles consistently applied
and fairly present in all material respects the consolidated financial condition
and results of operations of Performance Guarantor and its consolidated
Subsidiaries as of such dates and for the periods ended on such dates. Since the
later of (i) December 31, 2001 and (ii) the last time this representation was
made or deemed made, no event has occurred which would or could reasonably be
expected to have a Material Adverse Effect.
(e) Taxes. Performance Guarantor has filed all United States federal
tax returns and all other tax returns which are required to be filed and have
paid all taxes due pursuant to said returns or pursuant to any assessment
received by Performance Guarantor or any of its Subsidiaries, except such taxes,
if any, as are being contested in good faith and as to which adequate reserves
have been provided. The United States income tax returns of Performance
Guarantor have been audited by the Internal Revenue Service through the fiscal
year ended December 31, 2002. No federal or state tax liens have been filed and
no claims are being asserted with respect to any such taxes. The charges,
accruals and reserves on the books of Performance Guarantor in respect of any
taxes or other governmental charges are adequate.
(f) Litigation and Contingent Obligations. Except as disclosed in
the filings made by Performance Guarantor with the Securities and Exchange
Commission, there are no actions, suits or proceedings pending or, to the best
of Performance Guarantor's knowledge threatened against or affecting Performance
Guarantor 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 on (i)
the business, properties, condition (financial or otherwise) or results of
operations of Performance Guarantor and its Subsidiaries taken as a whole, (ii)
the ability of Performance Guarantor to perform its obligations under this
Undertaking, or (iii) the validity or enforceability of any of this Undertaking
or the rights or remedies of Recipient hereunder. Performance Guarantor does not
have any material Contingent Obligations not provided for or disclosed in the
financial statements referred to in Section 6(d).
Section 6A. Financial Covenants. Each of the financial covenants set
forth in Section 5.02 of each of the Credit Agreements is hereby incorporated by
reference, as if each such covenant were set forth herein in its entirety, such
incorporation by reference to be effective from and after the date on which the
commitments of the financial institutions party thereto expire, cease to be
available to Xxxxxx Energy Company or otherwise cease to be in full force and
effect.
Section 6B. Intercreditor Agreement. Performance Guarantor will take no
action in violation of any provision of the Intercreditor Agreement or fail to
take any action that could be reasonably expected to result in a violation of
any provision of the Intercreditor Agreement.
Section 7. Subrogation; Subordination. Notwithstanding anything to the
contrary contained herein, until the Guaranteed Obligations are paid in full
Performance Guarantor: (a) will not enforce or otherwise exercise any right of
subrogation to any of the rights of Recipient, the Agent or any Lender against
any Originator, (b) hereby waives all rights of subrogation
5
(whether contractual, under Section 509 of the United States Bankruptcy Code, at
law or in equity or otherwise) to the claims of Recipient, the Agent and the
Lenders against any Originator and all contractual, statutory or legal or
equitable rights of contribution, reimbursement, indemnification and similar
rights and "claims" (as that term is defined in the United States Bankruptcy
Code) which Performance Guarantor might now have or hereafter acquire against
any Originator that arise from the existence or performance of Performance
Guarantor's obligations hereunder, (c) will not claim any setoff, recoupment or
counterclaim against any Originator in respect of any liability of Performance
Guarantor to such Originator and (d) waives any benefit of and any right to
participate in any collateral security which may be held by Beneficiaries, the
Agent or the Lenders. The payment of any amounts due with respect to any
indebtedness of any Originator now or hereafter owed to Performance Guarantor is
hereby subordinated to the prior payment in full of all of the Guaranteed
Obligations. Performance Guarantor agrees that, after the occurrence of any
default in the payment or performance of any of the Guaranteed Obligations,
Performance Guarantor will not demand, xxx for or otherwise attempt to collect
any such indebtedness of any Originator to Performance Guarantor until all of
the Guaranteed Obligations shall have been paid and performed in full. If,
notwithstanding the foregoing sentence, Performance Guarantor shall collect,
enforce or receive any amounts in respect of such indebtedness while any
Obligations are still unperformed or outstanding, such amounts shall be
collected, enforced and received by Performance Guarantor as trustee for
Recipient (and its assigns) and be paid over to Recipient (or its assigns) on
account of the Guaranteed Obligations without affecting in any manner the
liability of Performance Guarantor under the other provisions of this
Undertaking. The provisions of this Section 7 shall be supplemental to and not
in derogation of any rights and remedies of Recipient under any separate
subordination agreement which Recipient may at any time and from time to time
enter into with Performance Guarantor.
Section 8. Termination of Performance Undertaking. Performance
Guarantor's obligations hereunder shall continue in full force and effect until
all Obligations are finally paid and satisfied in full and the Credit and
Security Agreement is terminated, provided that this Undertaking shall continue
to be effective or shall be reinstated, as the case may be, if at any time
payment or other satisfaction of any of the Guaranteed Obligations is rescinded
or must otherwise be restored or returned upon the bankruptcy, insolvency, or
reorganization of any Originator or otherwise, as though such payment had not
been made or other satisfaction occurred, whether or not Recipient (or its
assigns) is in possession of this Undertaking. No invalidity, irregularity or
unenforceability by reason of the federal bankruptcy code or any insolvency or
other similar law, or any law or order of any government or agency thereof
purporting to reduce, amend or otherwise affect the Guaranteed Obligations shall
impair, affect, be a defense to or claim against the obligations of Performance
Guarantor under this Undertaking.
Section 9. Effect of Bankruptcy. This Undertaking shall survive the
insolvency of any Originator and the commencement of any case or proceeding by
or against any Originator under the federal bankruptcy code or other federal,
state or other applicable bankruptcy, insolvency or reorganization statutes. No
automatic stay under the federal bankruptcy code with respect to any Originator
or other federal, state or other applicable bankruptcy, insolvency or
reorganization statutes to which any Originator is subject shall postpone the
obligations of Performance Guarantor under this Undertaking.
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Section 10. Setoff. Regardless of the other means of obtaining payment
of any of the Guaranteed Obligations, Recipient (and its assigns) is hereby
authorized at any time and from time to time, without notice to Performance
Guarantor (any such notice being expressly waived by Performance Guarantor) and
to the fullest extent permitted by law, to set off and apply any deposits and
other sums against the obligations of Performance Guarantor under this
Undertaking, whether or not Recipient (or any such assign) shall have made any
demand under this Undertaking and although such Obligations may be contingent or
unmatured.
Section 11. Taxes. (a) All payments to be made by Performance Guarantor
hereunder shall be made free and clear of any deduction or withholding. If
Performance Guarantor is required by law to make any deduction or withholding on
account of any Tax or otherwise from any such payment, the sum due from it in
respect of such payment shall be increased to the extent necessary to ensure
that, after the making of such deduction or withholding, any Recipient receives
a net sum equal to the sum which it would have received had no deduction or
withholding been made.
(b) Notwithstanding any other provision of this Undertaking, the
Performance Guarantor shall not be required to indemnify or pay any additional
amounts to the Recipient (or its assigns) pursuant to this Section 11 with
respect to Taxes imposed by the United States if the obligation to withhold with
respect to such Taxes results from, or would not have occurred but for, the
failure of the Recipient (or its assigns) to deliver to the Performance
Guarantor (following written request by the Performance Guarantor) (i) a
complete and properly executed Internal Revenue Service Form W-8BEN or W-8ECI,
as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Recipient (or its assigns) is entitled to benefits
under an income tax treaty to which the United States is a party which reduces
to zero the rate of withholding tax on payments due under this Undertaking or
certifying that the income receivable pursuant to this Undertaking or any of the
other Transaction Documents is effectively connected with the conduct of trade
or business in the United States, (ii) a complete and properly executed Internal
Revenue Service Form W-9, or any successor form prescribed by the Internal
Revenue Service, (iii) any other complete and properly executed form or
certificate required by any taxing authority (including any certificate required
by Sections 871(h) and 881(c) of the Tax Code), certifying that such Recipient
(or its assigns) is entitled to a complete exemption from tax on payments
pursuant to this Undertaking or any of the other Transaction Documents, or (iv)
a complete and properly executed Internal Revenue Service Form W-8IMY and any
related documents required in conjunction with such W-8IMY (unless such failure
is due to a change in treaty, law or regulation occurring subsequent to the date
on which a form originally was required to be provided). The Recipient (or its
assigns) shall not have failed to comply with the provisions of this Section
11(b) if it is legally unable to deliver the forms described herein.
(c) If any Recipient (or its assigns) actually receives a refund or
actually realizes the benefit of a credit or reduction in respect of any Taxes
for which it has received any payments pursuant to this Section 11 with respect
to Taxes, such Recipient (or the assignee who received such refund or realized
such benefit) shall within 45 days from the date of such receipt or realization
pay over the amount of such refund, credit or reduction to the Performance
Guarantor (but only to the extent of the payments made pursuant to this Section
11 with respect to Taxes), net of all reasonable out-of-pocket expenses of such
Recipient (or such assignee) and without interest
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(other than interest paid by the relevant Governmental Authority with respect to
such refund, credit or reduction).
(d) References in this Section 11 to the Recipient shall also refer
to and include any assignee, participant, transferee, successor or designee of
all or a portion of such Recipient's rights and obligations under this
Undertaking. Therefore, each assignee, participant, transferee, successor or
designee shall be required to deliver or cause to be delivered to the Recipient
properly completed and duly executed documents as provided in Section 11(b).
Section 12. Further Assurances. Performance Guarantor agrees that it
will from time to time, at the request of Recipient (or its assigns), provide
information relating to the business and affairs of Performance Guarantor as
Recipient may reasonably request. Performance Guarantor also agrees to do all
such things and execute all such documents as Recipient (or its assigns) may
reasonably consider necessary or desirable to give full effect to this
Undertaking and to perfect and preserve the rights and powers of Recipient
hereunder.
Section 13. Successors and Assigns. This Undertaking shall be binding
upon Performance Guarantor, its successors and permitted assigns, and shall
inure to the benefit of and be enforceable by Recipient and its successors and
assigns. Performance Guarantor may not assign or transfer any of its obligations
hereunder without the prior written consent of each of Recipient and the Agent.
Without limiting the generality of the foregoing sentence, Recipient may assign
or otherwise transfer the Agreements, any other documents executed in connection
therewith or delivered thereunder or any other agreement or note held by them
evidencing, securing or otherwise executed in connection with the Guaranteed
Obligations, or sell participations in any interest therein, to any other entity
or other person, and such other entity or other person shall thereupon become
vested, to the extent set forth in the agreement evidencing such assignment,
transfer or participation, with all the rights in respect thereof granted to the
Beneficiaries herein.
Section 14. Amendments and Waivers. No amendment or waiver of any
provision of this Undertaking nor consent to any departure by Performance
Guarantor therefrom shall be effective unless the same shall be in writing and
signed by Recipient, the Agent and Performance Guarantor. No failure on the part
of Recipient 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.
Section 15. Notices. All notices and other communications provided for
hereunder shall be made in writing and shall be addressed as follows: if to
Performance Guarantor, at the address set forth beneath its signature hereto,
and if to Recipient, at the addresses set forth beneath its signature hereto, or
at such other addresses as each of Performance Guarantor or any Recipient may
designate in writing to the other. Each such notice or other communication shall
be effective (1) if given by telecopy, upon the receipt thereof, (2) if given by
mail, three (3) Business Days after the time such communication is deposited in
the mail with first class postage prepaid or (3) if given by any other means,
when received at the address specified in this Section 15.
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Section 16. GOVERNING LAW. THIS UNDERTAKING SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF
NEW YORK.
Section 17. CONSENT TO JURISDICTION. EACH OF PROVIDER AND RECIPIENT
HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED
STATES FEDERAL OR NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS UNDERTAKING, THE
AGREEMENTS OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION THEREWITH OR DELIVERED
THEREUNDER AND EACH OF THE PERFORMANCE GUARANTOR AND RECIPIENT HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
Section 18. Bankruptcy Petition. Performance Guarantor hereby covenants
and agrees that, prior to the date that is one year and one day after the
payment in full of all outstanding senior Indebtedness of Blue Ridge, it will
not institute against, or join any other Person in instituting against, Blue
Ridge any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceeding under the laws of the United States or
any state of the United States.
Performance Guarantor hereby covenants and agrees that, prior to the
date that is one year and one day after the payment in full of all outstanding
senior indebtedness of Blue Ridge, it will not institute against, or join any
other Person in instituting against, Recipient any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceeding
under the laws of the United States or any state of the United States.
Section 19. Miscellaneous. This Undertaking constitutes the entire
agreement of Performance Guarantor with respect to the matters set forth herein.
The rights and remedies herein provided are cumulative and not exclusive of any
remedies provided by law or any other agreement, and this Undertaking shall be
in addition to any other guaranty of or collateral security for any of the
Guaranteed Obligations. The provisions of this Undertaking are severable, and in
any action or proceeding involving any state corporate law, or any state or
federal bankruptcy, insolvency, reorganization or other law affecting the rights
of creditors generally, if the obligations of Performance Guarantor hereunder
would otherwise be held or determined to be avoidable, invalid or unenforceable
on account of the amount of Performance Guarantor's liability under this
Undertaking, then, notwithstanding any other provision of this Undertaking to
the contrary, the amount of such liability shall, without any further action by
Performance Guarantor or Recipient, be automatically limited and reduced to the
highest amount that is valid and enforceable as determined in such action or
proceeding. Any provisions of this Undertaking which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
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Unless otherwise specified, references herein to "Section" shall mean a
reference to sections of this Undertaking.
10
IN WITNESS WHEREOF, Performance Guarantor has caused this Undertaking
to be executed and delivered as of the date first above written.
XXXXXX ENERGY COMPANY
By:
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Name:
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Title:
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Address for Notices:
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SCHEDULE A
COMMITMENTS OF LIQUIDITY BANKS
LIQUIDITY BANK COMMITMENT
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Wachovia Bank, National Association $ 80,000,000
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SCHEDULE B
DOCUMENTS TO BE DELIVERED TO THE AGENT
ON OR PRIOR TO THE INITIAL PURCHASE
Reference is made to that Wachovia/Xxxxxx Securitization Transaction Closing
Checklist, Closing Date January 31, 2003 and each of the agreements,
certificates, opinions and other documents referenced therein.
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