WAIVER AND AMENDMENT NO. 5
Exhibit 10.3
WAIVER AND AMENDMENT NO. 5
This WAIVER AND AMENDMENT NO. 5 (this “Amendment”) is dated as of October 6, 2005, and
is entered into by and among FLOWSERVE RECEIVABLES CORPORATION, a Delaware corporation
(“SPV”), FLOWSERVE US INC., a Delaware corporation (“Flowserve”), FLOWSERVE
CORPORATION, a New York corporation (the “Provider” and together with SPV and Flowserve,
the “Flowserve Entities”), the funding sources party hereto as the financial institutions
(the “Financial Institutions”), JUPITER SECURITIZATION CORPORATION (together with the
Financial Institutions, the “Purchasers”), and JPMORGAN CHASE BANK, N.A. (successor by
merger to Bank One, NA (Main Office Chicago)), as agent (the “Agent”) for the Purchasers.
W I T N E S S E T H:
WHEREAS, SPV, Flowserve, the Purchasers and the Agent are parties to that certain Receivables
Purchase Agreement, dated as of October 7, 2004 (as amended, restated, supplemented or otherwise
modified from time to time, the “RPA”);
WHEREAS, SPV and Flowserve are parties to that certain Receivables Sale Agreement, dated as of
October 7, 2004 (as amended, restated, supplemented or otherwise modified from time to time, the
“RSA”);
WHEREAS, the Provider executed a Performance Undertaking dated as of October 7, 2004 in favor
of SPV (as amended, restated, supplemented or otherwise modified from time to time, the
“Performance Undertaking” and together with the RSA and the RPA, the “Agreements”);
WHEREAS, as of the end of the Accrual Period ended August 31, 2005, the average Loss Ratio in
respect of the three Accrual Periods then most recently ended exceeded 3.5%, which constitutes an
Amortization Event under Section 9.1(e)(i) of the RPA (the “Specified Amortization
Event”);
WHEREAS, the Agent and the Purchasers have agreed to waive the Specified Amortization Event on
the terms and conditions set forth herein; and
WHEREAS, the Agent, the Purchasers, the SPV and Flowserve have agreed to amend the RPA on the
terms set forth herein;
NOW THEREFORE, in consideration of the premises herein contained, and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties hereto hereby
agree as follows:
1. Defined Terms. Capitalized terms used and not otherwise defined herein shall have
the meanings assigned to such terms in the RPA.
2. Waiver.
(a) Subject to the terms and conditions set forth herein and in reliance on the
representations and warranties of the Flowserve Entities herein contained, the Agent and the
Purchasers hereby waive the Specified Amortization Event.
(b) The waiver set forth in Section 2(a) shall be limited precisely as written and
relate solely to the noncompliance by the SPV with the provisions of the RPA with the Specified
Amortization Event, and nothing in this Amendment shall be deemed to:
1. constitute a waiver of noncompliance by SPV with respect to (i) Section 9.1(e)(i) of
the RPA in any other instance or (ii) any other term, provision or condition of the RPA or
any other Transaction Document;
2. constitute a waiver of noncompliance by Flowserve with respect to any term,
provision or condition of the RPA, the RSA or any other Transaction Document;
3. constitute a waiver of noncompliance by the Provider with respect to any term,
provision or condition of the Performance Undertaking or any other Transaction Document; or
4. prejudice any right or remedy that SPV, the Agent or any Purchaser may now have
(except to the extent such right or remedy was based upon the Specified Amortization Event)
or may have in the future under or in connection with any Agreement or any other Transaction
Document.
Except as expressly set forth herein, the terms, provisions and conditions of each Agreement
shall remain in full force and effect and in all other respects are hereby ratified and confirmed.
3. Amendment to the RPA. Subject to the satisfaction of the conditions precedent set
forth in Section 5 below, the Agent, the SPV, the Purchasers and Flowserve agree that Exhibit I
of the RPA is amended to delete the definition therein of “Liquidity Termination Date”
in its entirety and to substitute the following new definition therefor:
“Liquidity Termination Date” means December 6, 2005.
4. Representations and Warranties. Each of SPV, Flowserve and the Provider
represents and warrants, a s to itself only and not as to the others, that:
(a) The representations and warranties of the Flowserve Entities set forth in Agreements
(other than the representation and warranty of the Provider set forth in first sentence of Section
6(d) of the Performance Undertaking with respect to the June 30, 2004 financial
statements of the Provider and its consolidated Subsidiaries) are true, correct and complete on the
date hereof as if made on and as of the date hereof and there exists no Amortization Event,
Potential Amortization Event, Termination Event or Potential Termination Event on the date hereof,
provided, that, in the case of any representation or warranty in any Agreement that expressly
relates to facts in existence on an earlier date, the reaffirmation thereof under this Section 4(a)
shall be made as of such earlier date.
(b) The execution and delivery by SPV, Flowserve and the Provider of this Amendment has been
duly authorized by proper corporate proceedings of SPV, Flowserve and the Provider and each of this
Amendment and each Agreement, as amended by this Amendment, constitutes the legal, valid and
binding obligation of SPV, Flowserve and the Provider, as applicable, enforceable against such
Person in accordance with its terms, except as such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws of general applicability
affecting the enforcement of creditors’ rights generally.
5. Conditions Precedent. This Amendment shall become effective as of the date first
written above upon the Agent’s receipt of counterparts of this Amendment executed by SPV, the
Provider, Flowserve and each Purchaser.
6. Ratification. Each Agreement is hereby ratified, approved and confirmed in all
respects.
7. Reference to the Agreements. From and after the effective date hereof, each
reference any Agreement to “this Agreement”, “hereof”, or “hereunder” or words of like import, and
all references to such Agreement in any and all agreements, instruments, documents, notes,
certificates and other writings of every kind and nature shall be deemed to mean such Agreement.
8. Costs and Expenses. Each Flowserve Entity agrees to pay all reasonable costs, fees
and out-of-pocket expenses (including attorneys’ fees and time charges of attorneys representing
the Agent, which attorneys may be employees of the Agent) incurred by the Agent in connection with
the preparation, execution and enforcement of this Amendment.
9. CHOICE OF LAW. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS.
10. Execution of Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall constitute one and
the same agreement.
11. Reaffirmation of Performance Undertaking. Without limiting Section 6
hereof, the Provider consents to the execution by SPV and Flowserve of this Amendment,
reaffirms all of its obligations under the Performance Undertaking and acknowledges and agrees
that, after giving effect to this Amendment, the Performance Undertaking remains in full force
and effect and is hereby ratified and confirmed.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered
by their duly authorized officers as of the date first written above:
| FLOWSERVE RECEIVABLES CORPORATION | ||||||
| By: | /s/ Xxxx X. Xxxxx | |||||
| Name: Xxxx X. Xxxxx | ||||||
| Title: Vice President | ||||||
| FLOWSERVE US INC. | ||||||
| By: | /s/ Xxxx X. Xxxxx | |||||
| Name: Xxxx X. Xxxxx | ||||||
| Title: Vice President | ||||||
| FLOWSERVE CORPORATION | ||||||
| By: | /s/ Xxxx X. Xxxxx | |||||
| Name: Xxxx X. Xxxxx | ||||||
| Title: Vice President | ||||||
| JUPITER SECURITIZATION CORPORATION | ||||||
| By: | JPMorgan Chase Bank, N.A., its attorney- in-fact | |||||
| By: | /s/ Xxxxxxx X. Xxxx | |||||
| Name: Xxxxxxx X. Xxxx | ||||||
| Title: | ||||||
| JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, NA (Main Office Chicago)), as a Financial Institution and as Agent | ||||||
| By: | /s/ Xxxxxxx X. Xxxx | |||||
| Name: Xxxxxxx X. Xxxx | ||||||
| Title: Authorized Signatory | ||||||
