EXHIBIT 99.3
------------------------------------------------------------------------------
AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT
dated as of October 6, 2000
among
WARNACO OPERATIONS CORPORATION, as Seller
XXXXXXX STREET, INC., as Servicer
VARIOUS FINANCIAL INSTITUTIONS,
as Purchasers
and
THE BANK OF NOVA SCOTIA,
as Agent
and
CITIBANK, N.A.,
as the Co-Agent
------------------------------------------------------------------------------
TABLE OF CONTENTS
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1.Purchase Facility................................................2
Section 1.2.Purchase Procedure. ............................................2
Section 1.3.Continuation and Conversion Elections............................3
Section 1.4.Purchased Interest Computation...................................4
Section 1.5.Rates............................................................4
Section 0.0.Xxxx Termination Event Rates.....................................4
Section 1.7.Settlement Procedures............................................5
Section 1.8.Fees.............................................................9
Section 1.9.Payments and Computations, Etc...................................9
Section 1.10.Sharing of Payments.............................................9
Section 1.11.Eurodollar Rate Lending Unlawful...............................10
Section 1.12.Increased Costs................................................10
Section 1.13.Requirements of Law............................................11
Section 1.14.Broken Funding.................................................12
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
Section 2.1.Representations and Warranties; Covenants.......................12
Section 2.2.Termination Events..............................................12
ARTICLE III.
INDEMNIFICATION
Section 3.1.Indemnities by the Seller.......................................13
Section 3.2.Indemnities by the Servicer.....................................14
ARTICLE IV.
ADMINISTRATION AND COLLECTIONS
Section 4.1.Appointment of the Servicer.....................................15
Section 4.2.Duties of the Servicer..........................................16
Section 4.3.Establishment and Use of Certain Accounts.......................17
Section 4.4.Enforcement Rights..............................................17
Section 4.5.Responsibilities of the Seller..................................18
Section 4.6.Servicing Fee...................................................18
ARTICLE V.
THE AGENTS
Section 5.1.Appointment and Authorization...................................18
Section 5.2.Delegation of Duties............................................19
Section 5.3.Exculpatory Provisions..........................................19
Section 0.0.Xxxxxxxx by Agents..............................................19
Section 5.5.Notice of Termination Events....................................20
Section 5.6.Non-Reliance on Agent and Other Purchasers......................20
Section 5.7.Agents and Affiliates...........................................20
Section 5.8.Indemnification.................................................20
Section 5.9.Successor Agent.................................................21
Section 5.10.Certain Pool Assets and Other Matters..........................21
ARTICLE VI.
MISCELLANEOUS
Section 6.1.Amendments, Etc.................................................21
Section 6.2.Notices, Etc....................................................22
Section 6.3.Assignability...................................................22
Section 6.4.Participations..................................................24
Section 6.5.Certain Other Provisions........................................24
Section 6.6.Costs, Expenses and Taxes.......................................25
Section 0.0.Xx Proceedings; Limitation on Payments..........................25
Section 6.8.GOVERNING LAW AND JURISDICTION..................................26
Section 6.9.Execution in Counterparts.......................................26
Section 6.10.Survival of Termination........................................26
Section 6.11.WAIVER OF JURY TRIAL...........................................26
Section 6.12.Entire Agreement...............................................27
Section 6.13.Headings.......................................................27
Section 6.14.Conduit Purchaser's Liabilities................................27
EXHIBIT I Definitions
EXHIBIT II Conditions Precedent
EXHIBIT III Representations and Warranties
EXHIBIT IV Covenants
EXHIBIT V Termination Events
SCHEDULE I Credit and Collection Policy
SCHEDULE II Trade Names
SCHEDULE III Fiscal Months
ANNEX A Form of Monthly Report
ANNEX B Form of Purchase Request
ANNEX C Form of Continuation/Conversion Notice
ANNEX D Form of Weekly Report
ANNEX E Form of Purchaser Assignment Agreement
This AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT (as
amended, supplemented or otherwise modified and in effect from time to
time, this "Agreement") is entered into as of October 6, 2000, among
WARNACO OPERATIONS CORPORATION, a Delaware corporation, as seller (the
"Seller"), XXXXXXX STREET, INC., a Delaware corporation ("Xxxxxxx"), as
initial servicer (in such capacity, together with its successors and
permitted assigns in such capacity, the "Servicer"), the various financial
institutions as are or may become parties hereto as Purchasers
(collectively, the "Purchasers"), THE BANK OF NOVA SCOTIA, a Canadian
chartered bank acting through its New York branch ("BNS"), as agent for the
Purchasers (in such capacity, together with its successors and assigns in
such capacity, together with its successors and assigns in such capacity,
the "Agent"), and CITIBANK, N. A., a national banking association
("Citibank"), as co-agent (in such capacity, together with its successors
and assigns in such capacity, the "Co-Agent").
PRELIMINARY STATEMENTS. Certain terms that are capitalized and used
throughout this Agreement are defined in Exhibit I. References in the
Exhibits hereto to the "Agreement" refer to this Agreement, as amended,
supplemented or otherwise modified and in effect from time to time.
This Agreement amends and restates in its entirety the Receivables
Purchase Agreement dated as of September 30, 1998 (the "Original
Agreement"), among the Seller, the Servicer, Liberty Street Funding Corp.,
a Delaware corporation ("Liberty Street"), Corporate Asset Funding Company,
Inc., a Delaware corporation ("CAFCO"), the Agent and Co-Agent. Upon the
effectiveness of this Agreement, the terms and provisions of the Original
Agreement shall, subject to this paragraph, be superseded hereby in their
entirety. Notwithstanding the amendment and restatement of the Original
Agreement by this Agreement, the Seller and the Servicer shall continue to
be liable to Liberty Street, CAFCO, the Agent, Co-Agent or any other
Indemnified Party or Affected Person (as such terms are defined in the
Original Agreement) with respect to all unpaid fees and expenses accrued to
the date hereof under the Original Agreement and all agreements to
indemnify such parties in connection with events or conditions arising or
existing prior to the effective date of this Agreement. Upon the
effectiveness of this Agreement, each reference to the Original Agreement
in any other document, instrument or agreement shall mean and be a
reference to this Agreement. Nothing contained herein, unless expressly
herein stated to the contrary, is intended to amend, modify or otherwise
effect any other instrument, document or agreement executed and or
delivered in connection with the Original Agreement.
The Seller desires to sell, transfer and assign to the Purchasers
undivided variable percentage ownership interests in a pool of receivables,
and the Purchasers desire to acquire such undivided variable percentage
ownership interests on the terms and subject to the conditions set forth
herein.
In consideration of the mutual agreements, provisions and covenants
contained herein, the parties hereto agree as follows:
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1.Purchase Facility. (a) On the terms and conditions
hereinafter set forth, the Purchasers shall purchase, ratably in accordance
with their respective Percentages, and make reinvestments in, undivided
percentage ownership interests with regard to the Purchased Interest from
the Seller from time to time from the date hereof to the Facility
Termination Date. Under no circumstances shall any Purchaser be obligated
to make any such purchase or reinvestment if, after giving effect thereto,
(i) the Aggregate Capital would exceed the Purchase Limit or (ii) the
aggregate outstanding Capital of any Purchaser hereunder would exceed such
Purchaser's "Percentage" of the Aggregate Capital.
(b) The Seller may, upon at least 30 days' written notice to the
Agent and Co-Agent, terminate in whole or reduce in part the unused portion
of the Purchase Limit; provided, that each partial reduction shall be in
the amount of at least $10,000,000, or an integral multiple of $5,000,000
in excess thereof, and that, unless terminated in whole, the Purchase Limit
shall in no event be reduced below $100,000,000.
Section 1.2.Purchase Procedure. (a) The Seller may from time to time
request that a purchase of undivided percentage ownership interests with
regard to the Purchased Interest be made by the Purchasers on any Business
Day, by delivery to the Agent a Purchase Request on or before 10:00 a.m.
(i) on the Business Day immediately preceding the date of such requested
purchase (in the case of a purchase to be funded as a Base Rate Tranche) or
(ii) three Business Days prior to the date of such requested purchase (in
the case of a purchase to be funded as a Eurodollar Rate Tranche). Upon
receipt of such Purchase Request, the Agent shall notify each Purchaser
thereof within two hours of its receipt of such Purchase Request. All such
Purchases shall be made in a minimum aggregate amount of $5,000,000 and an
aggregate integral multiple of $1,000,000 or, if less, in the unused amount
of the applicable Purchase Limit.
(b) On the date of each purchase (but not reinvestment) each
Purchaser, shall, upon satisfaction of the applicable conditions set forth
in Exhibit II, make available to the Seller in same day funds, at Citibank,
N.A., account number 4077-4094, ABA 021-00-0089, an amount equal to its
Percentage of the amount of the purchase requested by Seller in such
Purchaser Request relating to its Purchased Interest then being purchased.
(c) The Aggregate Capital with respect to the Purchased Interest
shall be allocated to one or more tranches (each, a "Tranche") each having
such Interest Period and accruing Discount at the Rate Types specified in a
Purchase Request or Continuation/Conversion Notice delivered pursuant to
Section 1.3 and determined in accordance with Section 1.5. At any time,
each Tranche shall have only one Interest Period and one Rate Type. At no
time shall the number of Interest Periods for all Tranches exceed eight.
(d) Effective on the date of each purchase pursuant to this Section
and each reinvestment pursuant to Section 1.7, the Seller hereby sells and
assigns to the Agent, for the benefit of each Purchaser, undivided
percentage ownership interests in: (i) each Pool Receivable then existing,
(ii) all Related Security with respect to such Pool Receivables, and (iii)
all Collections with respect to, and other proceeds of, such Pool
Receivables and Related Security.
(e) To secure all of the Seller's obligations (monetary or otherwise)
under this Agreement and the other Transaction Documents to which it is a
party, whether now or hereafter existing or arising, due or to become due,
direct or indirect, absolute or contingent, the Seller hereby grants to the
Agent, for the benefit of the Purchasers, a security interest in all of the
Seller's right, title and interest (including any undivided interest of the
Seller) in, to and under all of the following, whether now or hereafter
owned, existing or arising: (i) all Pool Receivables, (ii) all Related
Security with respect to such Pool Receivables, (iii) all Collections with
respect to such Pool Receivables, (iv) the Collection Account and all
amounts on deposit therein, and all certificates and instruments, if any,
from time to time evidencing the Collection Account and amounts on deposit
therein, (v) all rights (but none of the obligations) of the Seller under
the Xxxxxxx Xxxx Agreement, and (vi) all proceeds of, and all amounts
received or receivable under any or all of, the foregoing (collectively,
the "Pool Assets"). Upon the sale of a Defaulted Receivable by the Servicer
permitted by Section 1(e) of Exhibit IV, the security interest of the Agent
in such Defaulted Receivable shall automatically be released and the Agent
shall take such actions as may be reasonably requested by the purchaser of
such Defaulted Receivable to evidence such release. The Agent, for the
benefit of the Purchasers, shall have, with respect to the Pool Assets, and
in addition to all the other rights and remedies available to the Agent and
the Purchasers hereunder, all the rights and remedies of a secured party
under any applicable UCC.
Section 1.3.Continuation and Conversion Elections. By delivering a
Continuation/Conversion Notice in the form of Annex C to the Agent in
accordance with Section 5.2 (which notice must be received by the Agent
before 11:00 a.m., New York City time) on a Business Day, the Seller may
from time to time irrevocably elect, on not less than one Business Day's
notice in the case of conversions to Base Rate Tranches, or three Business
Days' notice in the case of conversions to or continuations of Eurodollar
Rate Tranches, and in either case not more than five Business Days, that
all, or any portion in an aggregate minimum aggregate amount of $1,000,000
and an integral multiple of $200,000 be, in the case of Base Rate Tranches
converted into Eurodollar Rate Tranches or be, in the case of Eurodollar
Rate Tranches converted into Base Rate Tranches or continued as Eurodollar
Rate Tranches (in the absence of delivery of a Continuation/Conversion
Notice with respect to any Eurodollar Rate Tranche at least three Business
Days (but not more than five Business Days) before the last day of the then
current Interest Period with respect thereto, such Eurodollar Rate Tranche
shall, on such last day, automatically convert to a Base Rate Tranche);
provided, however, that (i) each such conversion or continuation shall be
prorated among the applicable outstanding Tranches of all Purchasers and
(ii) no Tranche may be continued as, or be converted into, Eurodollar Rate
Tranches when any Termination Event or Unmatured Termination Event has
occurred and is continuing (unless the Purchasers otherwise agree in
writing).
Section 1.4. Purchased Interest Computation. The Purchased Interest
shall be initially computed on the date of its initial purchase hereunder.
Thereafter, until the Facility Termination Date, the Purchased Interest
shall be automatically recomputed (or deemed to be recomputed) on each
Business Day other than a Termination Day. The Purchased Interest as
computed (or deemed recomputed) as of the day before the Facility
Termination Date shall thereafter remain constant. The Purchased Interest
shall become zero on the Final Payout Date.
Section 1.5. Rates. Subject to Section 1.2, 1.3 and 1.6, the Seller
may elect, pursuant to an appropriately delivered Purchase Request or
Continuation/Conversion Notice that each Tranche accrue interest at a rate
per annum:
(a) in the case of a Base Rate Tranche, during each Interest
Period, equal to the sum of the Base Rate from time to time in
effect during such Interest Period plus the Applicable Margin;
and
(b) in the case of a Eurodollar Rate Tranche, during each Interest
Period applicable thereto, equal to the sum of the Eurodollar
Rate for such Interest Rate plus the Applicable Margin.
"Eurodollar Rate" means, for any Interest Period, an interest rate per
annum (rounded upward to the nearest 1/16th of 1%) determined pursuant to
the following formula:
LIBOR
_________________________________
100% - Eurodollar Rate Reserve Percentage
where "Eurodollar Rate Reserve Percentage" means, for any Interest Period,
the maximum reserve percentage (expressed as a decimal, rounded upward to
the nearest 1/100th of 1%) in effect on the date LIBOR for such Interest
Period is determined under regulations issued from time to time by the
Federal Reserve Board for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve
requirement) with respect to "Eurocurrency" funding (currently referred to
as "Eurocurrency liabilities") having a term comparable to such Interest
Period.
"LIBOR" means, for any Interest Period, the rate of interest per
annum equal to the rate per annum at which dollar deposits in the
approximate amount of the Tranche to be funded at the Eurodollar Rate
during such Interest Period would be offered by major banks in the London
interbank market to The Bank of Nova Scotia at its request at or about
11:00 a.m. (London time) on the second Business Day before the commencement
of such Interest Period.
Section 1.6. Post Termination Event Rates. From and after the
occurrence and during the continuance, of a Termination Event or a Default
Event, the Seller shall pay, but only to the extent permitted by law,
interest (after as well as before judgment) on each Tranche at a rate equal
to 2.00% per annum above the Base Rate in effect from time to time plus the
Applicable Margin.
Section 1.7. Settlement Procedures. (a) The collection of the Pool
Receivables shall be administered by the Servicer in accordance with this
Agreement. The Seller shall provide to the Servicer on a timely basis all
information needed for such administration, including notice of the
occurrence of any Termination Day and current computations of the Purchased
Interests.
(b) The Servicer shall, on each day on which Collections of Pool
Receivables are received (or deemed received in accordance with Section
1.7(e)) by the Seller or Servicer, transfer such Collections into the
Collection Account. With respect to such Collections on such day, the
Servicer shall:
(i) set aside in the Collection Account for the benefit of the
Purchasers, out of the percentage of such Collections represented by
the Purchased Interest, first an amount equal to the Discount accrued
through such day for each Tranche and not previously set aside,
second, an amount equal to the Fees payable to the Purchasers and
accrued through such day and not previously set aside, and third, an
amount equal to such Purchasers' Share of the Servicing Fee accrued
through such day and not previously set aside; and
(ii) subject to Section 1.7(f), if such day is not a
Termination Day, remit to the Seller, on behalf of the Purchasers,
the remainder of the percentage of such Collections, represented by
the Purchased Interest, to the extent representing a return on the
Aggregate Capital; such Collections shall be automatically reinvested
for the benefit of the Purchasers in Pool Receivables, and in the
Related Security and Collections and other proceeds with respect
thereto, and the Purchased Interest shall be automatically recomputed
pursuant to Section 1.4;
(iii) if such day is a Termination Day, (A) set aside and
retain in the Collection Account for the benefit of the Purchasers,
the entire remainder of the percentage of the Collections represented
by the Purchased Interest; provided that, so long as the Facility
Termination Date has not occurred, if any amounts are so set aside
and retained in the Collection Account on any Termination Day and
thereafter, the conditions set forth in Section 2 of Exhibit II are
satisfied or are waived by the Required Purchasers, such previously
set aside amounts shall, to the extent representing a return on the
Aggregate Capital and not applied to the reduction of the Aggregate
Capital pursuant to Section 1.7(g), be reinvested in accordance with
the preceding paragraph (ii) on the day of such subsequent
satisfaction or waiver of conditions, and (B) set aside and retain in
the Collection Account the entire remainder of the Collections in the
Collection Account represented by the Seller's Share of the
Collections, if any; provided, that so long as the Facility
Termination Date has not occurred, if any amounts are so set aside
and retained in the Collection Account on any Termination Day and
thereafter, the conditions set forth in Section 2 of Exhibit II are
satisfied or are waived by the Required Purchasers, such previously
set aside amounts shall, to the extent not applied to the reduction
of the Aggregate Investment pursuant to Section 1.7(g), be
distributed to the Seller on the day of such subsequent satisfaction
or waiver of conditions; and
(iv) during such times as amounts are required to be reinvested
in accordance with the foregoing paragraph (ii) or the proviso to
paragraph (iii), release to the Seller (subject to Section 1.7(f))
for its own account any Collections in excess of (x) such amounts,
(y) the amounts that are required to be set aside and retained in the
Collection Account pursuant to paragraph (i) above and (z) in the
event Xxxxxxx (or any Affiliate of Group) is not the
Servicer, all reasonable and appropriate out-of-pocket costs and
expenses of such Servicer of servicing, collecting and administering
the Pool Receivables.
(c) The Servicer shall deposit into an account designated by the
Agent for the benefit of the Purchasers, on each Settlement Date for each
Tranche and for each Settlement Date for the payment of fees, as the case
may be:
(i) Collections held on deposit in the Collection Account for
the benefit of the Purchasers pursuant to Section 1.7(b)(i) in
respect of accrued Discount for such Tranche and accrued and unpaid
Fees;
(ii) Collections held on deposit in the Collection Account for
the benefit of the Purchasers pursuant to Section 1.7(f); and
(iii) If such Settlement Date occurs on a date that is a
Termination Day, the lesser of (x) the sum of (i) the amount of
Collections then held on deposit in the Collection Account for the
benefit of the Purchasers pursuant to Section 1.7(b)(iii)(A) plus
(ii) the amount of Collections then on deposit in the Collection
Account in respect of the Seller's Share of Collections pursuant to
Section 1.7(b)(iii)(B) and (y) the Tranche Amount of such Tranche.
The Servicer shall deposit to its own account from Collections held on
deposit in the Collection Account pursuant to Section 1.7(b)(i) in respect
of the accrued Servicing Fee, an amount equal to such accrued Servicing
Fee.
(d) Upon receipt of funds deposited into the Agent's account pursuant
to Section 1.7(c), the Agent shall distribute to the Purchasers ratably in
accordance with each Purchaser's Pro Rata Share as follows:
(i) if such distribution occurs on a day that is not a
Termination Day, first to the Purchasers in payment in full of all
accrued and unpaid Discount for such Tranche and accrued and unpaid
Fees payable to the Purchasers, and second, if the Servicer has set
aside amounts in respect of the Servicing Fee pursuant to Section
1.7(b)(i) and has not retained such amounts pursuant to Section
1.7(c), to the Servicer (payable in arrears on each Settlement Date)
in payment in full of each Purchasers' Share of accrued Servicing
Fees so set aside, and
(ii) if such distribution occurs on a Termination Day or on a
day when the Purchased Interest exceeds 100%, first to the Purchasers
in payment in full of all accrued Discount and such accrued and
unpaid Fees, second to the Purchasers in payment of the Capital of
the Purchasers (or, if such day is not a Termination Day, the amount
necessary to reduce the Purchased Interest to 100%), third, if
Xxxxxxx or an Affiliate of Group is not the Servicer, to the Servicer
in payment in full of all accrued Servicing Fees, fourth, if the
Aggregate Capital and accrued Discount with respect to each Tranche
has been reduced to zero, and all accrued Servicing Fees payable to
the Servicer (if other than Xxxxxxx or an Affiliate of Group) have
been paid in full, to such Purchaser, the Agent, the Co-Agent and any
other Indemnified Party or Affected Person in payment in full of any
other amounts owed thereto by the Seller hereunder and, fifth, unless
such amount has been retained by the Servicer pursuant to Section
1.7(c), to the Servicer (if the Servicer is Xxxxxxx or an Affiliate
of Group) in payment in full of such Purchasers' Share of all accrued
Servicing Fees.
After the Aggregate Capital, Discount with respect to all Tranches, Fees
and Servicing Fees, and any other amounts payable by the Seller and the
Servicer to the Purchasers, the Agent, the Co-Agent or any other
Indemnified Party or Affected Person hereunder, have been paid in full, all
additional Collections with respect to the Purchased Interests shall be
paid to the Seller for its own account.
(e) For the purposes of this Section 1.7:
(i) if on any day the Outstanding Balance of any Pool
Receivable is reduced or adjusted as a result of any defective,
rejected, returned, repossessed or foreclosed goods or services, or
any revision, cancellation, allowance, discount or other adjustment
made by any Originator, the Servicer, the Seller or any Affiliate of
the Seller, or any setoff or dispute between any Originator, the
Seller or any Affiliate of the Seller and an Obligor, the Seller
shall be deemed to have received on such day a Collection of such
Pool Receivable in the amount of such reduction or adjustment;
(ii) if on any day any of the representations or warranties in
Section 1(g) or (m) of Exhibit III is not true with respect to any
Pool Receivable, the Seller shall be deemed to have received on such
day a Collection of such Pool Receivable in full;
(iii) except as otherwise required by applicable law or the
relevant Contract, all Collections received from an Obligor of any
Receivable shall be applied to the Receivables of such Obligor in the
order of the age of such Receivables, starting with the oldest such
Receivable, unless such Obligor designates in writing its payment for
application to specific Receivables; and
(iv) if and to the extent the Agent, the Co-Agent or any
Purchaser shall be required for any reason to pay over to an Obligor
(or any trustee, receiver, custodian or similar official in any
Insolvency Proceeding) any amount received by it hereunder, such
amount shall be deemed not to have been so received by the Agent, the
Co-Agent or such Purchaser, as the case may be, but rather to have
been retained by the Seller and, accordingly, the Agent, the Co-Agent
or such Purchaser, as the case may be, shall have a claim against the
Seller for such amount, payable when and to the extent that any
distribution from or on behalf of such Obligor is made in respect
thereof.
(f) If at any time the Seller shall wish to cause the reduction of
the Aggregate Capital of the Purchased Interest, the Seller may do so as
follows:
(i) the Seller shall give the Agent, the Co-Agent and the
Servicer at least five Business Days' prior written notice thereof
(including the amount of such proposed reduction and the proposed
date on which such reduction will commence);
(ii) on the proposed date of commencement of such reduction and
on each day thereafter, the Servicer shall cause Collections not to
be reinvested until the amount thereof not so reinvested shall equal
the desired amount of reduction; and
(iii) the Servicer shall hold such Collections in the
Collection Account for the benefit of the Purchasers, for payment to
the Agent on behalf of each Purchaser in accordance with such
Purchaser's Pro Rata Share on the first Settlement Date to occur with
respect to any Tranche, and the Capital of each Purchaser shall be
deemed reduced in the amount to be paid to the applicable Purchaser
only when in fact finally so paid; provided, however, that if the
amount of such proposed reduction exceeds the Tranche Amount for such
Tranche, the amount of such excess shall be applied on the next
Settlement Date to occur for the other outstanding Tranches until
such excess amount has been applied to reduce the Tranche Amounts;
provided, that:
(A) the amount of any such reduction shall be not less than
$2,000,000 and shall be an integral multiple of $1,000,000, and no
Tranche Amount for any Tranche after giving effect to such reduction
shall be less than $2,000,000 (unless such Tranche Amount shall have
been reduced to zero);
(B) the Seller shall choose a reduction amount, and the date of
commencement thereof, so that to the extent practicable such
reduction shall commence and conclude in the same Interest Period;
and
(C) The Capital of each Purchaser shall be reduced pro rata
such that after giving effect to such reduction, the outstanding
Capital of such Purchaser hereunder is equal to such Purchaser's
Percentage of the Aggregate Capital.
(g) Notwithstanding any term or provision to the contrary contained
in this Agreement, if on any Weekly Report Date occurring prior to the
Facility Termination Date, the sum of the Aggregate Capital and Total
Reserves shall exceed the Net Receivable Pool Balance, the Seller shall not
later than 2:00 p.m. New York City time on the Business Day immediately
succeeding such Weekly Report Date, deposit into an account designated by
Agent for the benefit of the Purchasers, in reduction of the Aggregate
Capital, such amount as may be necessary to cause the sum of the Aggregate
Capital and Total Reserves to not exceed the Net Receivable Pool Balance
(after giving effect to the application of such payment to the reduction of
such Aggregate Capital). Upon receipt of such funds deposited in the
Agent's account, the Agent shall distribute such funds to the Purchasers
ratably in accordance with each Purchaser's Pro Rata Share and the Capital
of each Purchaser shall be reduced by the amount of such payment. Any
payments required to be made by the Seller pursuant to this Section 1.7(g)
shall be subject to any Breakage Amounts in accordance with Section 1.14.
Section 1.8.Fees. The Seller shall pay to the Agent for the account
of the Purchasers certain fees in the amounts and on the dates set forth in
a letter, dated the date hereof, among the Seller, the Agent (as such
letter agreement may be amended, supplemented or otherwise modified from
time to time, the "Fee Letter").
Section 1.9. Payments and Computations, Etc. (a) All amounts to be
paid or deposited by the Seller or the Servicer hereunder shall be made
without reduction for offset or counterclaim and shall be paid or deposited
no later than 12:00 noon (New York City time) on the day when due in same
day funds to the account designated by the Agent. All amounts received
after 12:00 noon (New York City time) will be deemed to have been received
on the next Business Day.
(b) The Seller or the Servicer, as the case may be, shall, to the
extent permitted by law, pay interest on any amount not paid or deposited
by the Seller or the Servicer for the account of the Agent, any Purchaser
or any other Affected Person, as the case may be, within three Business
Days of the date such payment or deposit is due, at an interest rate equal
to 2.0% per annum above the Base Rate, payable on demand.
(c) All computations of interest under Section 1.9(b) and all
computations of Discount, fees and other amounts hereunder shall be made on
the basis of a year of 360 (or 365 or 366, as applicable, with respect to
Discount or other amounts calculated by reference to the Base Rate) days
for the actual number of days elapsed. Whenever any payment or deposit to
be made hereunder shall be due on a day other than a Business Day, such
payment or deposit shall be made on the next Business Day and such
extension of time shall be included in the computation of such payment or
deposit.
Section 1.10. Sharing of Payments. If any Purchaser shall obtain any
payment or other recovery (whether voluntary, involuntary, by application
of setoff or otherwise) on account of any Tranche (other than pursuant to
the terms of Sections 1.12, and 1.13) in excess of its pro rata share of
payments pursuant to Section 1.9, then or therewith obtained by all
Purchasers, such Purchaser shall purchase from the other Purchasers such
participations in purchases made by them (without recourse, representation
or warranty) as shall be necessary to cause such purchasing Purchaser to
share the excess payment or other recovery ratably with each of them;
provided, however, that if all or any portion of the excess payment or
other recovery is thereafter recovered from such purchasing Purchaser, the
purchase shall be rescinded and each Purchaser which has sold a
participation to the purchasing Purchaser shall repay to the purchasing
Purchaser the purchase price to the ratable extent of such recovery
together with an amount equal to such selling Purchaser's ratable share
(according to the proportion of (a) the amount of such selling Purchaser's
required repayment to the purchasing Purchaser to (b) the total amount so
recovered from the purchasing Purchaser) of any interest or other amount
paid or payable by the purchasing Purchaser in respect of the total amount
so recovered. The Seller agrees that any Purchaser so purchasing a
participation from another Purchaser pursuant to this Section may, to the
fullest extent permitted by law, exercise all its rights of payment with
respect to such participation as fully as if such Purchaser were the direct
creditor of the Seller in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Purchaser
receives a secured claim in lieu of a setoff to which this Section applies,
such Purchaser shall, to the extent practicable, exercise its rights in
respect of such secured claim in a manner consistent with the rights of the
Purchasers entitled under this Section to share in the benefits of any
recovery on such secured claim.
Section 1.11. Eurodollar Rate Lending Unlawful. If any Purchaser shall
determine (which determination shall, upon notice thereof to the Seller and
the Agent, be conclusive and binding on the Seller) that the introduction
of or any change in or in the interpretation of any law makes it unlawful,
or any central bank or other governmental authority asserts that it is
unlawful, for such Purchaser to make, continue or maintain any Tranche as,
or to convert any Tranche into, a Eurodollar Rate Tranche, the obligations
of such Purchaser to make, continue, maintain or convert any such
Eurodollar Rate Tranche shall, upon such determination, forthwith be
suspended until such Purchaser shall notify the Agent that the
circumstances causing such suspension no longer exist, and all outstanding
Eurodollar Rate Tranches of such Purchaser shall automatically convert into
Base Rate Tranches at the end of the then current Interest Periods with
respect thereto or sooner, if required by such law or assertion; provided,
however, that, before making any such determination such Purchaser agrees
to use reasonable efforts (consistent with its internal policy and legal
and regulatory restrictions) to designate a different eurodollar lending
office if the making of such a designation would allow Purchaser or its
eurodollar lending office to continue to perform its obligations to make
eurodollar rate credit extensions or to continue to fund or maintain
eurodollar rate credit extensions and would not, in the judgment of such
Purchaser, be otherwise disadvantageous to such Purchaser.
Section 1.12. Increased Costs. (a) If any Affected Person determines
that the existence of or compliance with: (i) any law or regulation or any
change therein or in the interpretation or application thereof, in each
case adopted, issued or occurring after the date hereof, or (ii) any
request, guideline or directive from any central bank or other Governmental
Authority (whether or not having the force of law) issued or occurring
after the date of this Agreement, affects or would affect the amount of
capital required or expected to be maintained by such Affected Person, and
such Affected Person determines that the amount of such capital is
increased by or based upon the existence of any commitment to make
purchases of (or otherwise to maintain the investment in) Pool Receivables
related to this Agreement or any related liquidity facility, credit
enhancement facility and other commitments of the same type, then, upon
demand by such Affected Person (with a copy to the Agent), the Seller shall
pay to the Agent within 30 days of such demand, for the account of such
Affected Person, additional amounts sufficient to compensate such Affected
Person. A certificate submitted to the Seller and the Agent by such
Affected Person, certifying, in reasonably specific detail, the basis for
and calculation of such amounts, shall be conclusive and binding for all
purposes, absent manifest error.
(b) If, due to either: (i) the introduction of or any change in or in
the interpretation of any law or regulation or (ii) compliance with any
guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law), there shall be any increase in
the cost to any Affected Person of agreeing to purchase or purchasing, or
maintaining the ownership of, the Purchased Interest in respect of which
Discount is computed by reference to the Eurodollar Rate,
then, upon demand by such Affected Person, the Seller shall pay to such
Affected Person within 30 days of such demand, additional amounts
sufficient to compensate such Affected Person for such increased costs. A
certificate submitted to the Seller and the Agent by such Affected Person,
certifying, in reasonably specific detail, the basis for and calculation of
such amounts, shall be conclusive and binding for all purposes, absent
manifest error.
Section 1.13. Requirements of Law. If any Affected Person reasonably
determines that the existence of or compliance with: (a) any law or
regulation or any change therein or in the interpretation or application
thereof, in each case adopted, issued or occurring after the date hereof,
or (b) any request, guideline or directive from any central bank or other
Governmental Authority (whether or not having the force of law) issued or
occurring after the date of this Agreement:
(i) does or shall subject such Affected Person to any tax of
any kind whatsoever with respect to this Agreement, any increase in
any Purchased Interest or in the amount of Capital relating thereto,
or does or shall change the basis of taxation of payments to such
Affected Person on account of Collections, Discount or any other
amounts payable hereunder (excluding taxes imposed on the overall
pre-tax net income of such Affected Person, and franchise taxes
imposed on such Affected Person, by the jurisdiction under the laws
of which such Affected Person is organized or a political subdivision
thereof),
(ii) does or shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar requirement
against assets held by, or deposits or other liabilities in or for
the account of, purchases, advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such
Affected Person, or
(iii) does or shall impose on such Affected Person any other
condition,
and the result of any of the foregoing is: (A) to increase the cost to such
Affected Person of acting as Agent, or of agreeing to purchase or
purchasing or maintaining the ownership of undivided percentage ownership
interests with regard to any Purchased Interest (or interests therein) or
any Tranche, or (B) to reduce any amount receivable hereunder (whether
directly or indirectly), then, in any such case, upon demand by such
Affected Person, the Seller shall pay to such Affected Person within 30
days of such demand additional amounts necessary to compensate such
Affected Person for such additional cost or reduced amount receivable. All
such amounts shall be payable as incurred. A certificate from such Affected
Person to the Seller, certifying, in reasonably specific detail, the basis
for and calculation of the amount of such additional costs or reduced
amount receivable, shall be conclusive and binding for all purposes, absent
manifest error.
Section 1.14. Broken Funding. In the event of (i) the payment of any
principal of any Tranche (other than a Base Rate Tranche) other than on the
Settlement Date applicable thereto (including as a result of the occurrence
of the Termination Date or payment in respect of a reduction of the Capital
of a Tranche pursuant to Section 1.7(f) or (g)), or (ii) any failure to
borrow, continue or reduce any Tranche (other than a Base Rate Tranche) on
the date specified in any notice delivered pursuant hereto, then, in any
such event, the Seller shall pay to the Purchasers for the loss, cost and
expense attributable to such event. Such loss, cost or expense to any such
Purchaser shall be deemed to include an amount (the "Breakage Amount")
determined by such Purchaser to be the excess, if any, of (i) the amount of
Discount which would have accrued on the Tranche Amount of such Tranche had
such event not occurred, at the Tranche Rate that would have been
applicable to such Tranche, for the period from the date of such event to
the last day of the applicable Interest Period (or, in the case of a
failure to borrow for the period that would have been the related Interest
Period), over (ii) the amount of interest which would be obtainable upon
redeployment or reinvestment of an amount of funds equal to such Tranche
Amount for such period. A certificate of any Purchaser incurring any loss,
cost or expense as a result of any of the events specified in this Section
1.14 and setting forth any amount or amounts that such Purchaser is
entitled to receive pursuant to this Section 1.l4 and the reason(s)
therefor shall be delivered to the Seller by the Agent and shall include
reasonably detailed calculations and shall be conclusive absent manifest
error. The Seller shall pay to the related Agent on behalf of each such
Purchaser the amount shown as due on any such certificate within ten (10)
days after receipt thereof.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
Section 2.1.Representations and Warranties; Covenants. Each of the
Seller and the Servicer hereby makes the representations and warranties,
and hereby agrees to perform and observe the covenants, applicable to it
set forth in Exhibits III and IV, respectively.
Section 2.2.Termination Events. (a) If any of the Termination Events
set forth in Exhibit V shall occur, the Agent may, and if directed by the
Required Purchasers, shall, by notice to the Seller, declare the Facility
Termination Date to have occurred (in which case the Facility Termination
Date shall be deemed to have occurred); provided, that automatically upon
the occurrence of any event (without any requirement for the passage of
time or the giving of notice) described in paragraph (f) of Exhibit V, the
Facility Termination Date shall occur. Upon any occurrence of any
Termination Event, the Agent and the Purchasers shall have, in addition to
the rights and remedies that they may have under this Agreement, all other
rights and remedies provided after default under the New York UCC and under
other applicable law, which rights and remedies shall be cumulative.
(b) Notwithstanding anything to the contrary contained in this
Section 2.2 and Section 4.4, if a Termination Event described in paragraph
(j) of Exhibit V shall have occurred, each of the Agent, the Co-Agent and
the Purchasers agree that it will refrain from exercising any right, remedy
or power available to it hereunder or pursuant to an applicable law
(including, without limitation, the right to declare the Facility
Termination Date to have occurred) solely as a result of the occurrence of
such Termination Event) until such time as any Lender Party is permitted,
in accordance with the terms of the Intercreditor Agreement (or any
Purchaser is permitted by a vote or with the consent of the Required
Lenders), to exercise any rights, remedies or power available to it by
reason of the occurrence of any of the events or circumstances giving rise
to the occurrence
of such Termination Event; provided, however, that foregoing shall not
prohibit the Agent, the Co- Agent or any Purchaser from exercising any
right, power, or remedy available to it under Section 1.6 or 4.3(b) hereof
as a result of the occurrence of a Termination Event or Default Event, as
applicable.
ARTICLE III.
INDEMNIFICATION
Section 3.1.Indemnities by the Seller. Without limiting any other
rights that any Indemnified Party may have hereunder or under applicable
law, the Seller hereby agrees to indemnify each Indemnified Party from and
against any and all claims, damages, expenses, costs, losses and
liabilities (including Attorney Costs) (all of the foregoing being
collectively referred to as "Indemnified Amounts") arising out of or
resulting from this Agreement (whether directly or indirectly), the use of
proceeds of purchases or reinvestments, the ownership of the Purchased
Interest, or any interest therein, or, in respect of any Receivable,
Related Security or Contract, excluding, however: (a) Indemnified Amounts
to the extent resulting from gross negligence or willful misconduct on the
part of such Indemnified Party, (b) recourse (except as otherwise
specifically provided in this Agreement) for uncollectible Receivables, or
(c) any overall net income taxes or franchise taxes imposed on such
Indemnified Party by the jurisdiction under the laws of which such
Indemnified Party is organized or any political subdivision thereof.
Without limiting or being limited by the foregoing, and subject to the
exclusions set forth in the preceding sentence, the Seller shall pay on
demand to each Indemnified Party any and all amounts necessary to indemnify
such Indemnified Party from and against any and all Indemnified Amounts
relating to or resulting from any of the following:
(i) the failure of any Receivable included in the calculation
of the Net Receivables Pool Balance as an Eligible Receivable to be
an Eligible Receivable, the failure of any information contained in a
Monthly Report or the Weekly Report to be true and correct, or the
failure of any other information provided to any Purchaser, the Agent
or the Co-Agent with respect to Receivables or this Agreement to be
true and correct,
(ii) the failure of any representation, warranty or statement
made or deemed made by the Seller (or any of its officers) under or
in connection with this Agreement to have been true and correct as of
the date made or deemed made in all respects when made,
(iii) the failure by the Seller to comply with any applicable
law, rule or regulation with respect to any Pool Receivable or the
related Contract, or the failure of any Pool Receivable or the
related Contract to conform to any such applicable law, rule or
regulation,
(iv) the failure to vest in the Agent, for the benefit of each
Purchaser, a valid and enforceable: (A) perfected undivided
percentage ownership interest, to the extent of the Purchased
Interest of such Purchaser, in the Receivables in, or purporting to
be in, the
Receivables Pool and the other Pool Assets, or (B) first priority
perfected security interest in the Pool Assets, in each case, free
and clear of any Adverse Claim,
(v) 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 Receivables in, or purporting to be in, the
Receivables Pool and the other Pool Assets, whether at the time of
any purchase or reinvestment or at any subsequent time,
(vi) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment
of any Receivable in, or purporting to be in, the Receivables Pool
(including 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 goods or services related to
such Receivable or the furnishing or failure to furnish such goods or
services or relating to collection activities with respect to such
Receivable (if such collection activities were performed by the
Seller or any of its Affiliates acting as Servicer or by any agent or
independent contractor retained by the Seller or any of its
Affiliates),
(vii) any failure of the Seller (or any of its Affiliates
acting as the Servicer) to perform its duties or obligations in
accordance with the provisions hereof or under the Contracts,
(viii)any products liability or other claim, investigation,
litigation or proceeding arising out of or in connection with
merchandise, insurance or services that are the subject of any
Contract,
(ix) the commingling of Collections at any time with other funds,
(x) the use of proceeds by the Seller of purchases or
reinvestments, or
(xi) any reduction in Capital as a result of the distribution
of Collections pursuant to Section 1.7(d), if all or a portion of
such distributions shall thereafter be rescinded or otherwise must be
returned for any reason.
Section 3.2.Indemnities by the Servicer. Without limiting any other
rights that the Agent, the Purchasers or any other Indemnified Party may
have hereunder or under applicable law, the Servicer hereby agrees to
indemnify each Indemnified Party from and against any and all Indemnified
Amounts arising out of or resulting from (whether directly or indirectly):
(a) the failure of any information contained in a Monthly Report or a
Weekly Report to be true and correct, or the failure of any other
information provided to any Purchaser, the Agent or the Co-Agent by, or on
behalf of, the Servicer to be true and correct, (b) the failure of any
representation, warranty or statement made or deemed made by the Servicer
(or any of its officers) under or in connection with this Agreement to have
been true and correct in all respects as of the date made or deemed made,
(c) the failure by the Servicer to comply with any applicable law, rule or
regulation with respect to any Pool Receivable or the related Contract, or
(d) any failure of the Servicer to perform its covenants, duties or
obligations in accordance with the provisions hereof.
ARTICLE IV.
ADMINISTRATION AND COLLECTIONS
Section 4.1.Appointment of the Servicer. (a) The servicing,
administering and collection of the Pool Receivables shall be conducted by
the Person so designated from time to time as the Servicer in accordance
with this Section. Until the Agent gives notice to Xxxxxxx (in accordance
with this Section) of the designation of a new Servicer, Xxxxxxx is hereby
designated as, and hereby agrees to perform the duties and obligations of,
the Servicer pursuant to the terms hereof. Upon the occurrence of a
Termination Event, the Agent (at the direction of the Required Purchasers)
may designate as Servicer any Person (including itself) to succeed Xxxxxxx
or any successor Servicer, on the condition in each case that any such
Person so designated shall agree to perform the duties and obligations of
the Servicer pursuant to the terms hereof.
(b) Upon the designation of a successor Servicer as set forth in
Section 4.1(a), Xxxxxxx agrees that it will terminate its activities as
Servicer hereunder in a manner that the Agent reasonably determines will
facilitate the transition of the performance of such activities to the new
Servicer, and Xxxxxxx shall cooperate with and assist such new Servicer.
Such cooperation shall include access to and transfer of related records
and use by the new Servicer of all licenses, hardware or software necessary
or desirable to collect the Pool Receivables and the Related Security.
(c) Xxxxxxx acknowledges that, in making their decision to execute
and deliver this Agreement, the Agent, the Co-Agent and the Purchasers have
relied on Xxxxxxx'x agreement to act as Servicer hereunder. Accordingly,
Xxxxxxx agrees that it will not voluntarily resign as Servicer.
(d) The Servicer may delegate its duties and obligations hereunder to
any subservicer (each a "Sub-Servicer"); provided, that, in each such
delegation: (i) such Sub-Servicer shall agree in writing to perform the
duties and obligations of the Servicer pursuant to the terms hereof, (ii)
the Servicer shall remain primarily liable for the performance of the
duties and obligations so delegated, (iii) the Seller, the Agent, the
Co-Agent and the Purchasers shall have the right to look solely to the
Servicer for performance and (iv) the terms of any agreement with any
Sub-Servicer shall provide that the Agent and the Co-Agent may terminate
such agreement upon the termination of the Servicer hereunder by giving
notice of its desire to terminate such agreement to the Servicer (and the
Servicer shall provide appropriate notice to each such Sub-Servicer);
provided, however, that if any such delegation is to any Person other than
Group or an Affiliate of Group, the Agent and the Co-Agent shall have
consented in writing in advance to such delegation.
Section 4.2.Duties of the Servicer. (a) The Servicer shall take or
cause to be taken all such action as may be necessary or advisable to
administer and collect each Pool Receivable from time to time, all in
accordance with this Agreement and all applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Credit and Collection Policies. The Servicer shall set aside, for the
accounts of the Seller and the Purchasers, the amount of the Collections to
which each is entitled in accordance with Article I. The Servicer may, in
accordance with the applicable Credit and Collection Policy, extend the
maturity of any Pool Receivable, so long as no Termination Event or
Unmatured Termination Event has occurred or would result from such
extension, and extend the maturity or adjust the Outstanding Balance of any
Defaulted Receivable as the Servicer may determine to be appropriate to
maximize Collections thereof; provided, however, that: (i) such extension
or adjustment shall not alter the status of such Pool Receivable as a
Defaulted Receivable or limit the rights of the Purchasers or the Agent
under this Agreement and (ii) if a Termination Event has occurred and is
continuing and Xxxxxxx or an Affiliate of Group is serving as the Servicer,
Xxxxxxx or such Affiliate may make such extension or adjustment only upon
the prior approval of the Agent. The Seller shall deliver to the Servicer
and the Servicer shall hold for the benefit of the Seller and the Agent
(for the benefit of the Purchasers), in accordance with their respective
interests, all records and documents (including computer tapes or disks)
with respect to each Pool Receivable. Notwithstanding anything to the
contrary contained herein, for so long as a Termination Event has occurred
and is continuing, the Agent may direct the Servicer (whether the Servicer
is Xxxxxxx or any other Person) to commence or settle any legal action to
enforce collection of any Pool Receivable or to foreclose upon or repossess
any Related Security.
(b) The Servicer shall, as soon as practicable following actual
receipt of collected funds, turn over to the Seller the collections of any
indebtedness that is not a Pool Receivable, less, if Xxxxxxx or an
Affiliate of Group is not the Servicer, all reasonable and appropriate
out-of-pocket costs and expenses of such Servicer of servicing, collecting
and administering such collections. The Servicer, if other than Xxxxxxx or
an Affiliate of Group, shall, as soon as practicable upon demand, deliver
to the Seller all records in its possession that evidence or relate to any
indebtedness that is not a Pool Receivable, and copies of records in its
possession that evidence or relate to any indebtedness that is a Pool
Receivable.
(c) The Servicer's obligations hereunder shall terminate on the later
of: (i) the Facility Termination Date and (ii) the date on which all
amounts required to be paid to the Purchasers, the Agent, the Co-Agent and
any other Indemnified Party or Affected Person hereunder shall have been
paid in full.
After such termination, if Xxxxxxx or an Affiliate of Group was not
the Servicer on the date of such termination, the Servicer shall promptly
deliver to the Seller all books, records and related materials that the
Seller previously provided to the Servicer, or that have been obtained by
the Servicer, in connection with this Agreement.
Section 4.3.Establishment and Use of Certain Accounts. (a) The Seller
(or the Servicer on its behalf) agrees to establish the Collection Account
on or before the date of the effectiveness of this Agreement. The
Collection Account shall be used to accept the transfer of Collections of
Pool Receivables pursuant to Section 1.7(b) and for such other purposes
described in the Transaction Documents.
(b) Upon the occurrence and during the continuation of a Termination
Event or a Default Event, the Agent may, and if directed by the Required
Purchasers, shall at any time thereafter give notice to the Collection
Account Bank that the Agent is exercising its rights under the Collection
Account Agreement to do any or all of the following: (i) to have the
exclusive ownership and control of the Collection Account transferred to
the Agent and to exercise exclusive dominion and control over the funds
deposited therein, (ii) to have the proceeds that are sent to the
Collection Account redirected pursuant to the Agent's instructions rather
than deposited in the Collection Account, and (iii) to take any or all
other actions permitted under the Collection Account Agreement. The Seller
hereby agrees that if the Agent at any time takes any action set forth in
the preceding sentence, the Agent shall have exclusive control of the
proceeds (including Collections) of all Pool Receivables and the Seller
hereby further agrees to take any other action that the Agent may
reasonably request to transfer such control. Any proceeds of Pool
Receivables received by the Seller or the Servicer thereafter shall be sent
immediately to the Agent (or its designee).
Section 4.4.Enforcement Rights. (a) At any time following the
occurrence and during the continuance of a Termination Event (and in the
case of a Termination Event described in paragraph (j) of Exhibit V subject
to Section 2.2(b)):
(i) the Agent may direct the Obligors that payment of all
amounts payable under any Pool Receivable is to be made directly to
the Agent or its designee,
(ii) the Agent may give notice of the Agent's and the
Purchasers' interests in Pool Receivables to each Obligor, which
notice shall direct that payments be made directly to the Agent or
its designee, and
(iii) the Agent may request the Servicer to, and upon such
request the Servicer shall: (A) assemble all of the records necessary
or desirable to collect the Pool Receivables and the Related
Security, and transfer or license to a successor Servicer the use of
all software necessary or desirable to collect the Pool Receivables
and the Related Security, and make the same available to the Agent or
its designee at a place selected by the Agent, and (B) segregate all
cash, checks and other instruments received by it from time to time
constituting Collections in a manner acceptable to the Agent and,
promptly upon receipt, remit all such cash, checks and instruments,
duly endorsed or with duly executed instruments of transfer, to the
Agent or its designee.
(b) The Seller hereby authorizes the Agent, and irrevocably appoints
the Agent as its attorney-in-fact with full power of substitution and with
full authority in the place and stead of the Seller, which appointment is
coupled with an interest, to take any and all steps in the name of the
Seller and on behalf of the Seller necessary or desirable, in the
determination of the Agent, after the occurrence of a Termination Event, to
collect any and all amounts or portions thereof due under any and all Pool
Assets, including endorsing the name of the Seller on checks and other
instruments representing Collections and enforcing such Pool Assets.
Notwithstanding anything to the contrary contained in this subsection, none
of the powers conferred upon such attorney-in-fact pursuant to the
preceding sentence shall subject such attorney-in-fact to any liability if
any action taken by it shall prove to be inadequate or invalid, nor shall
they confer any obligations upon such attorney-in- fact in any manner
whatsoever.
Section 4.5. Responsibilities of the Seller. Anything herein to the
contrary notwithstanding, the Seller shall pay when due any taxes,
including any sales taxes payable in connection with the Pool Receivables
and their creation and satisfaction. None of the Agent, the Co- Agent or
any Purchaser shall have any obligation or liability with respect to any
Pool Asset, nor shall either of them be obligated to perform any of the
obligations of the Seller or Xxxxxxx thereunder.
Section 4.6. Servicing Fee. (a) Subject to Section 4.6(b), the
Servicer shall be paid a fee equal to .75% per annum (the "Servicing Fee
Rate") of the daily average aggregate Outstanding Balance of the Pool
Receivables. The Purchasers' Share of such fee shall be paid solely from
the distributions contemplated by Section 1.7(d), and the Seller's Share of
such fee shall be paid by the Seller.
If the Servicer ceases to be Xxxxxxx or an Affiliate of Group
the servicing fee shall be the greater of: (i) the amount calculated
pursuant to clause (a), and (ii) an alternative amount reasonably specified
by the successor Servicer not to exceed 110% of the aggregate reasonable
costs and expenses incurred by such successor Servicer in connection with
the performance of its obligations as Servicer.
ARTICLE V.
THE AGENTS
Section 5.1.Appointment and Authorization. (a) Each Purchaser and
Purchaser Agent hereby irrevocably designates and appoints The Bank of Nova
Scotia as the "Agent" hereunder and authorizes the Agent to take such
actions and to exercise such powers as are delegated to the Agent hereby
and to exercise such other powers as are reasonably incidental thereto. The
Agent shall hold, in its name, for the benefit of each Purchaser, ratably,
the Purchased Interest. The Agent shall not have any duties other than
those expressly set forth herein or any fiduciary relationship with any
Purchaser, and no implied obligations or liabilities shall be read into
this Agreement, or otherwise exist, against the Agent. The Agent does not
assume, nor shall it be deemed to have assumed, any obligation to, or
relationship of trust or agency with, the Seller or Servicer.
Notwithstanding any provision of this Agreement or any other Transaction
Document to the contrary, in no event shall the Agent ever be required to
take any action which exposes the Agent to personal liability or which is
contrary to the provision of any Transaction Document or applicable law.
(b) Except as otherwise specifically provided in this Agreement, the
provisions of this Article V are solely for the benefit of the Agent and
the Purchasers, and none of the Seller or Servicer shall have any rights as
a third-party beneficiary or otherwise under any of the provisions of this
Article V, except that this Article V shall not affect any obligations
which any Purchaser Agent, the Agent or any Purchaser may have to the
Seller or the Servicer under the other provisions of this Agreement.
(c) In performing its functions and duties hereunder, the Agent shall
act solely as the agent of the Purchasers and does not assume nor shall be
deemed to have assumed any obligation or relationship of trust or agency
with or for the Seller or Servicer or any of their successors and assigns.
Section 5.2.Delegation of Duties. The Agent may execute any of its
duties through agents or attorneys-in-fact and shall be entitled to advice
of counsel concerning all matters pertaining to such duties. The Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
Section 5.3.Exculpatory Provisions. None of the Agent or any of its
directors, officers, agents or employees shall be liable for any action
taken or omitted (i) with the consent or at the direction of the Required
Purchasers or (ii) in the absence of such Person's gross negligence or
willful misconduct. The Agent shall not be responsible to any Purchaser or
other Person for (i) any recitals, representations, warranties or other
statements made by the Seller, Servicer, or any of their Affiliates, (ii)
the value, validity, effectiveness, genuineness, enforceability or
sufficiency of any Transaction Document, (iii) any failure of the Seller,
any Originator or any of their Affiliates to perform any obligation or (iv)
the satisfaction of any condition specified in Exhibit II. The Agent shall
not have any obligation to any Purchaser to ascertain or inquire about the
observance or performance of any agreement contained in any Transaction
Document or to inspect the properties, books or records of the Seller,
Servicer, any Originator or any of their Affiliates.
Section 0.0.Xxxxxxxx by Agents. (a) The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any
document or other writing or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person and upon
advice and statements of legal counsel (including counsel to the Seller),
independent accountants and other experts selected by the Agent. The Agent
shall in all cases be fully justified in failing or refusing to take any
action under any Transaction Document unless it shall first receive such
advice or concurrence of the Required Purchasers, and assurance of its
indemnification, as it deems appropriate.
(b) The Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement in accordance with a request
of the Required Purchasers, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all Purchasers.
Section 5.5.Notice of Termination Events. The Agent shall not be
deemed to have knowledge or notice of the occurrence of any Termination
Event or Unmatured Termination Event unless such Agent has received notice
from any Purchaser, the Servicer or the Seller stating that a Termination
Event or Unmatured Termination Event has occurred hereunder and describing
such Termination Event or Unmatured Termination Event. The Agent shall take
such action concerning a Termination Event or Unmatured Termination Event
as may be directed by the Required Purchasers (unless such action otherwise
requires the consent of all Purchasers), but until the Agent
receives such directions, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, as the Agent deems
advisable and in the best interests of the Purchasers.
Section 5.6.Non-Reliance on Agent and Other Purchasers. Each
Purchaser expressly acknowledges that neither the Agent nor any of its
respective officers, directors, employees, agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act
by the Agent hereafter taken, including any review of the affairs of the
Seller, Xxxxxxx, Servicer or any Originator, shall be deemed to constitute
any representation or warranty by the Agent. Each Purchaser represents and
warrants to the Agent that, independently and without reliance upon the
Agent or any other Purchaser and based on such documents and information as
it has deemed appropriate, it has made and will continue to make its own
appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of the
Seller, Xxxxxxx, Servicer or any Originator, and the Receivables and its
own decision to enter into this Agreement and to take, or omit, action
under any Transaction Document. Except for items specifically required to
be delivered hereunder, the Agent shall not have any duty or responsibility
to provide any Purchaser with any information concerning the Seller,
Xxxxxxx, Servicer or the Originator or any of their Affiliates that comes
into the possession of the Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
Section 5.7.Agents and Affiliates. Each of the Purchasers and the
Agent and their Affiliates may extend credit to, accept deposits from and
generally engage in any kind of banking, trust, debt, equity or other
business with the Seller, Xxxxxxx, Servicer or any Originator or any of
their Affiliates and The Bank of Nova Scotia may exercise or refrain from
exercising its rights and powers as if it were not the Agent.
Section 5.8.Indemnification. Each Purchaser shall indemnify and hold
harmless the Agent and its officers, directors, employees, representatives
and agents (to the extent not reimbursed by the Seller, Xxxxxxx or Servicer
and without limiting the obligation of the Seller, Xxxxxxx or Servicer to
do so), ratably in accordance with its Purchaser's Pro Rata Share from and
against any and all liabilities, obligations, losses, damages, penalties,
judgments, settlements, costs, expenses and disbursements of any kind
whatsoever (including in connection with any investigative or threatened
proceeding, whether or not the Agent or such Person shall be designated a
party thereto) that may at any time be imposed on, incurred by or asserted
against the Agent or such Person as a result of, or related to, any of the
transactions contemplated by the Transaction Documents or the execution,
delivery or performance of the Transaction Documents or any other document
furnished in connection therewith (but excluding any such liabilities,
obligations, losses, damages, penalties, judgments, settlements, costs,
expenses or disbursements resulting solely from the gross negligence or
willful misconduct of the Agent or such Person as finally determined by a
court of competent jurisdiction); provided, that in the case of each
Purchaser that is a commercial paper conduit, such indemnity shall be
provided solely to the extent of amounts received by such Purchaser under
this Agreement which exceed the amounts required to repay such Purchaser's
outstanding Notes.
Section 5.9.Successor Agent. The Agent may, upon at least five (5)
days notice to the Seller and each Purchaser, resign as Agent. Such
resignation shall not become effective until a successor agent is appointed
by the Required Purchasers and has accepted such appointment. Upon
such acceptance of its appointment as Agent hereunder by a successor Agent,
such successor Agent shall succeed to and become vested with all the rights
and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under the Transaction Documents.
After any retiring Agent's resignation hereunder, the provisions of
Sections 3.1 and 3.2 and this Article V shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was the Agent.
Section 5.10. Certain Pool Assets and Other Matters. (a) The Agent is
authorized on behalf of all the Purchasers, without the necessity of any
notice to or further consent from the Purchasers, from time to time to take
any action with respect to any Pool Assets or the Transaction Documents
which may be necessary to perfect and maintain perfected the security
interest in and Liens upon the Pool Assets granted pursuant to the
Transaction Documents.
(b) The Purchasers irrevocably authorize the Agent, at its option and
in its discretion, to release any security interest or Lien granted to or
held by the Agent upon any Pool Assets (i) upon the Facility Termination
Date and the reduction of the Purchased Interest to zero, all fees payable
pursuant to Section 1.8, 3.1, 3.2 and 6.6 (including interest thereon) and
all other fees, costs and expenses that are payable under this Agreement or
under any other Transaction Document and have been invoiced (in which case
the Purchasers hereby authorize the Agent to execute, and the Agent agrees
to execute, reasonable releases in connection with this Agreement (other
than, in any event, as to items stated to survive the termination of this
Agreement)); (ii) constituting property sold or to be sold or disposed of
as part of or in connection with any disposition permitted hereunder; or
(iii) if approved, authorized or notified in writing by the Purchasers.
ARTICLE VI.
MISCELLANEOUS
Section 6.1.Amendments, Etc. No amendment or waiver of any provision
of this Agreement or any other Transaction Document, or consent to any
departure by the Seller or the Servicer therefrom, shall be effective
unless in a writing signed by the Required Purchasers, and, in the case of
any amendment, by the other parties thereto (other than the Agent and
Co-Agent); and then such amendment, waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given;
provided, however that no such amendment or waiver shall, (a) without the
consent of each Purchaser, (i) extend the date of any payment or deposit of
Collections by the Seller or the Servicer, (ii) reduce the rate or extend
the time of payment of Discount, (iii) reduce any fees payable to any
Purchaser hereunder, (iv) change the amount of outstanding Capital of any
Purchaser or any Purchaser's Percentage, (v) amend, modify or waive any
provision of the definition of "Required Purchaser" or this Section 6.1,
(vi) consent to or permit the assignment or transfer by the Seller of any
of its rights and obligations under this Agreement, (vii) change the
definition of "Eligible Receivable," "Loss Reserve," "Loss Reserve
Percentage," "Dilution Reserve," "Dilution Reserve Percentage" or
"Termination Event" or (viii) amend or modify any defined term (or any
defined term used directly or indirectly in such defined term) used in
clauses (i) through (viii) above in a manner that would circumvent the
intention of the restrictions set forth in such clauses (b) without the
consent of the Agent, affect the interests, rights or obligations of the
Agent or (c) without the consent of the Co-Agent, affect the interest,
rights or obligations of the Co-Agent; provided, further, however, that no
material amendment shall be effective until both Moody's and Standard &
Poor's have notified the Agent in writing that such action will not result
in a reduction or withdrawal of the rating of any Notes issued by Liberty
Street. No failure on the part of the Purchasers or the Agent 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 6.2.Notices, Etc. All notices and other communications
hereunder shall, unless otherwise stated herein, be in writing (which shall
include facsimile communication) and be sent or delivered to each party
hereto at its address set forth under its name on the signature pages
hereof or at such other address as shall be designated by such party in a
written notice to the other parties hereto. Notices and communications by
facsimile shall be effective when sent (and shall be followed by hard copy
sent by first class mail), and notices and communications sent by other
means shall be effective when received.
Section 6.3.Assignability. (a) Each Purchaser, with the prior written
consent of the Seller, (which consent shall not be unreasonably withheld or
delayed), and the Agent (which consent shall not be unreasonably withheld
or delayed), may assign and delegate all or a portion of its rights and
obligations hereunder (including without limitation, all or a portion of
its Capital and its interest in the Purchased Interest) to one or more
commercial banks or other financial institutions in a minimum aggregate
amount of $5,000,000 (or, if less, the total of such Purchaser's Capital;
provided, however, that no consent of the Seller shall be required if such
assignment and/or delegation is made to (i) an Eligible Assignee, (ii) any
other Purchaser or an Affiliate of such Purchaser thereof or, (iii) if such
Purchaser is a Conduit Purchaser, to a Program Support Provider for such
Conduit Purchaser (each Person described in either of the foregoing clauses
as the Person to whom such assignment and delegation is made being
hereinafter referred to as an "Assignee Purchaser"); or if a Termination
Event has occurred and is continuing; provided, further, that no such
assignment and delegation shall be effective until
(i) such Assignee Purchaser shall have executed and delivered
to the Seller and the Agent a Purchaser Assignment Agreement,
accepted by the Agent; and
(ii)the processing fees described below shall have been paid.
From and after the date that the Agent accepts such Purchaser Assignment
Agreement, (x) the Assignee Purchaser thereunder shall be deemed
automatically to have become a party hereto and to the extent that rights
and obligations hereunder have been assigned and delegated to such Assignee
Purchaser in connection with such Purchaser Assignment Agreement, shall
have the rights and obligations of a Purchaser hereunder and under the
other Transaction Documents, and (y) the assignor Purchaser, to the extent
that rights and obligations hereunder have been assigned and delegated by
it in connection with such Purchaser Assignment Agreement, shall be
released from its obligations hereunder and under the other Transaction
Documents. Accrued Discount on that portion of the Capital assigned, and
accrued fees, shall be paid as provided in the Purchaser
Assignment Agreement. Accrued Discount on that portion of Capital assigned
or delegated prior to the assignment or delegation shall be paid to the
assignor Purchaser. Accrued Discount and accrued fees shall be paid at the
same time or times provided in this Agreement. Such assignor Purchaser or
such Assignee Purchaser must also pay a processing fee to the Agent upon
delivery of any Purchaser Assignment Agreement in the amount of $3,500. Any
attempted assignment and delegation not made in accordance with this
Section 5.3 shall be null and void.
(b) Notwithstanding clause (a), any Purchaser may assign and pledge
all or any portion of its interest in the Purchased Interest and other
rights to a Federal Reserve Bank as collateral security; provided, however,
that no such assignment under this clause (b) shall release the assignor
Purchaser from any of its obligations hereunder.
(c) Liberty Street may, without the consent of the Seller, at any
time grant one or more Program Support Providers, participating interests
in its interest in the Purchased Interest. In the event of any such grant
by Liberty Street of a participating interest to a Program Support
Provider, such Purchaser shall remain responsible for the performance of
its obligations hereunder. The Seller agrees that each Program Support
Provider shall be entitled to the benefits of Sections 1.12 and 1.13.
(d) Each Conduit Purchaser agrees that it will not permit any Program
Support Provider to assign, in whole or in part, its commitment under any
liquidity agreement entered into in connection with this Agreement to any
Person (other than an Affiliate of such Program Support Provider) unless
such Person has been approved by the Seller; provided that such approval by
the Seller may not be unreasonably withheld.
(e) Except as provided in Section 4.1(d), neither the Seller nor the
Servicer may assign its rights or delegate its obligations hereunder or any
interest herein without the prior written consent of the Agent and all
Purchasers.
(f) Without limiting any other rights that may be available under
applicable law, the rights of each Purchaser may be enforced through it or
by its agents.
Section 6.4.Participations (a) Any Purchaser may at any time without
the consent of the Seller or the Agent (but with prior written notice to
the Agent and the Seller) sell to one or more commercial banks or other
Persons (each of such commercial banks and other Persons being herein
called a "Participant") participating interests in any of all or portion of
its rights and obligations hereunder (including without limitation, all or
portion of its Percentage of the Purchase Limit and any undivided ownership
interest of the Purchased Interest owned by it, or other interests of such
Purchaser hereunder; provided, however, that
(i) no participation contemplated in this Section 6.4 shall
relieve such Purchaser from its obligations hereunder or under any
other Transaction Document;
(ii) such Purchaser shall remain solely responsible for the
performance of its obligations;
(iii) the Seller the Agent and Co-Agent shall continue to deal
solely and directly with such Purchaser in connection with such
Purchaser's rights and obligations under this Agreement and each of
the other Transaction Documents;
(iv) no Participant, unless such Participant is an Affiliate of
such Purchaser, or is itself a Purchaser, shall be entitled to
require such Purchaser to take or refrain from taking any action
hereunder or under any other Transaction Document, except that such
Purchaser may agree with any Participant that such Purchaser will
not, without such Participant's consent, take any actions of the type
described in Section 6.1(a); and
(v) the Seller shall not be required to pay any amount under
clause (b) of this Section that is greater than the amount which it
would have been required to pay had no participating interest been
sold; and
(vi) such Purchaser shall record in books entries maintained by
such Purchaser the name of its Participants and the amounts such
Participants are entitled to receive in respect of any participating
interests sold pursuant to this Section.
(b) The Seller acknowledges and agrees that each Participant, for
purposes of Sections 1.12, 1.13, 3.1, 3.2 and 6.6, shall be considered a
Purchaser, subject to clause (v) above.
Section 6.5.Certain Other Provisions. (a) The Seller, any Originator
and the Servicer authorize each Purchaser to disclose to any participant or
assignee (each, a "Transferee") and any prospective Transferee, subject to
the agreement of such Transferee or prospective Transferee to keep
confidential, any and all financial and other information in such
Purchaser's possession concerning the Seller, any Originator, the Servicer
or any of their respective Subsidiaries which has been delivered to such
Purchaser by any such Person pursuant to or in connection with this
Agreement or which has been delivered to such Purchaser by any such Person
in connection with such Purchaser's credit evaluation of the Seller, any
Originator, the Servicer or any of their respective Subsidiaries prior to
entering into this Agreement.
(b) If, pursuant to this Section, any interest in this Agreement or
any portion of the Purchased Interest is transferred to any Transferee
which is organized under the laws of any jurisdiction other than the United
States or any State thereof, the transferor Purchaser shall cause such
Transferee (other than any Participant), and may cause any Participant,
concurrently with the effectiveness of such transfer, (i) to represent to
the transferor Purchaser (for the benefit of the transferor Purchaser, the
Agent, and the Seller) that under applicable law and treaties, no taxes
will be required to be withheld by the Agent, the Co-Agent, the Seller or
the transferor Purchaser with respect to any payments to be made to such
Transferee in respect of its interest in the Purchased Interest, (ii) to
furnish to the transferor Purchaser, the Agent, and the Seller either U.S.
Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 (wherein such Transferee claims entitlement to whole or partial
exemption from U.S. Federal withholding tax on all interest payments
hereunder) and (iii) to agree (for the benefit of the transferor Purchaser,
the Agent, and the Seller) to provide the transferor Purchaser, the Agent,
and the Seller a new Form 4224 or Form 1001 upon the obsolescence of any
previously delivered form and comparable statements in accordance with
applicable U.S. laws and regulations and amendments duly executed and
completed by such Transferee, and to comply from time to time with all
applicable U.S. laws and regulations with regard to such withholding tax
exemption.
Section 6.6.Costs, Expenses and Taxes. (a) In addition to the rights
of indemnification granted under Section 3.1, the Seller agrees to pay on
demand all reasonable costs and expenses in connection with the
preparation, execution, delivery and administration (including periodic
internal audits by the Agent, the Co-Agent or their respective designees of
Pool Receivables) of this Agreement, the other Transaction Documents and
the other documents and agreements to be delivered hereunder (and all
reasonable costs and expenses in connection with any amendment, waiver or
modification of any thereof, including: (i) Attorney Costs for the Agent,
the Co-Agent, the Purchasers and their respective Affiliates and agents
with respect thereto and with respect to advising the Agent, the Co-Agent,
the Purchasers and their respective Affiliates and agents as to their
rights and remedies under this Agreement and the other Transaction
Documents, and (ii) all reasonable costs and expenses (including Attorney
Costs), if any, of the Agent, the Co-Agent, the Purchasers and their
respective Affiliates and agents in connection with the enforcement of this
Agreement and the other Transaction Documents.
(b) In addition, the Seller shall pay on demand any and all stamp and
other taxes and fees payable in connection with the execution, delivery,
filing and recording of this Agreement or the other documents or agreements
to be delivered hereunder, and agrees to save each Indemnified Party
harmless from and against any liabilities with respect to or resulting from
any delay in paying or omission to pay such taxes and fees.
Section 6.7. No Proceedings; Limitation on Payments. Each of the
Seller, Xxxxxxx, the Servicer, the Agent, the Co-Agent, and the Purchasers
and each assignee of the Purchased Interest or any interest therein, hereby
covenants and agrees that it will not institute against, or join any other
Person in instituting against, any Conduit Purchaser any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding, or other
proceeding under any federal or state bankruptcy or similar law, for one
year and one day after the latest maturing Note issued by such Conduit
Purchaser is paid in full. The provision of this Section 6.7 shall survive
any termination of this Agreement.
Section 6.8. GOVERNING LAW AND JURISDICTION. (a) THIS AGREEMENT SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND
5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) EXCEPT TO
THE EXTENT THAT THE VALIDITY OR PERFECTION OF A SECURITY INTEREST OR
REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR
OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK; AND, BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES HERETO
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES HERETO IRREVOCABLY
WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, THAT IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY
DOCUMENT RELATED HERETO. EACH OF THE PARTIES HERETO WAIVES PERSONAL SERVICE
OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH SERVICE MAY BE MADE BY
ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
Section 6.9.Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which, when so executed, shall be
deemed to be an original, and all of which, when taken together, shall
constitute one and the same agreement.
Section 6.10Survival of Termination. This Agreement shall create and
constitute the continuing obligations of the parties hereto in accordance
with its terms, and shall remain in full force and effect until the Final
Payout Date. The provisions of Sections 1.12, 1.13, 3.1, 3.2, 6.6, 6.7,
6.8, 6.11 and 6.14 shall survive any termination of this Agreement.
Section 6.11WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO WAIVES
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY IN ANY ACTION, PROCEEDING OR OTHER
LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS OR
OTHERWISE. EACH OF THE PARTIES HERETO AGREES THAT ANY SUCH CLAIM OR CAUSE
OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING
THE FOREGOING, EACH OF THE PARTIES HERETO FURTHER AGREES THAT ITS
RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION
AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING THAT SEEKS, IN WHOLE OR
IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR
ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
Section 6.12. Entire Agreement. This Agreement and the other
Transaction Documents embody the entire agreement and understanding between
the parties hereto, and supersede all prior or contemporaneous agreements
and understandings of such Persons, verbal or written, relating to the
subject matter hereof and thereof.
Section 6.13. Headings. The captions and headings of this Agreement and
any Exhibit, Schedule or Annex hereto are for convenience of reference only
and shall not affect the interpretation hereof or thereof.
Section 6.14. Conduit Purchaser's Liabilities. The obligations of each
Conduit Purchaser under the Transaction Documents are solely the corporate
obligations of such Conduit Purchaser. No recourse shall be had for any
obligation or claim arising out of or based upon any Transaction Document
against any stockholder, employee, officer, director or incorporator of any
Conduit Purchaser; provided, however, that this Section shall not relieve
any such Person of any liability it might otherwise have for its own gross
negligence or willful misconduct.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
WARNACO OPERATIONS CORPORATION
By: /S/
-------------------------------------------
Name:
-------------------------------------------
Title:
-------------------------------------------
Address:
Attention:
Telephone No.:
Facsimile No.:
XXXXXXX STREET, INC.
By: /S/
-------------------------------------------
Name:
-------------------------------------------
Title:
-------------------------------------------
Address:
Attention:
Telephone No.:
Facsimile No.:
THE BANK OF NOVA SCOTIA,
as Agent
By: /S/
-------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
Address: Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:Xxxxxxx X. Xxxxxxx
Telephone No.:(000) 000-0000
Facsimile No.:(000) 000-0000
CITIBANK N.A.,
as Co-Agent
By: /S/
-------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
Address:399 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention:Xxxxxx Xxxxxx
Telephone No.:(000) 000-0000
Facsimile No.:(000) 000-0000
PURCHASERS
CITIBANK N.A.,
as a Purchaser
By: /S/
-------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
Percentage: ______
Address:399 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention:Xxxxxx Xxxxxx
Telephone No.:(000) 000-0000
Facsimile No.:(000) 000-0000
LIBERTY STREET FUNDING CORP.,
as a Purchaser
By: /S/
-------------------------------------
Name:
-------------------------------------
Title:
-------------------------------------
Percentage: _______
Address:c/o Global Securitization Services, LLC
000 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention No.:Xxxxxx X. Xxxxx
Telephone No.:(000) 000-0000
Facsimile No.:(000) 000-0000
With a copy to:
THE BANK OF NOVA SCOTIA
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone No(212) 000-0000
Facsimile No(212) 225-5090
EXHIBIT I
DEFINITIONS
As used in the Agreement (including its Exhibits, Schedules and
Annexes), 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). Unless otherwise indicated, all Section, Annex, Exhibit
and Schedule references in this Exhibit are to Sections of and Annexes,
Exhibits and Schedules to the Agreement.
"Adverse Claim" means a lien, security interest or other charge or
encumbrance, or any other type of preferential arrangement; it being
understood that any thereof in favor of any Purchaser or the Agent (for the
benefit of any Purchaser) shall not constitute an Adverse Claim.
"Affected Person" means the Agent, the Co-Agent, any Purchaser, any
Program Support Provider or any of their respective Affiliates.
"Affiliate" means, as to any Person, any other Person that, directly
or indirectly, is in control of, is controlled by, or is under common
control with, such Person. For purposes of this definition, control of a
Person shall include the power, direct or indirect, (a) to vote 10% or more
of the securities or other interests having ordinary voting power for the
election of directors or other managing Persons of such Person or (b) to
direct or cause direction of the management and policies of such Person
whether by contract or otherwise.
"Affiliated Obligor" means, (a) in relation to an Obligor that is a
Governmental Authority, any other Obligor that is a Governmental Authority,
and (b) in relation to an Obligor that is not a Governmental Authority,
each Obligor that is an Affiliate of such Obligor.
"Agent" has the meaning set forth in the preamble to the Agreement.
"Agreement" has the meaning set forth in the preamble to the
Agreement.
"Agreement Value" has the meaning set forth in Annex A to the
Facility Agreement, in effect on the date hereof.
"Aggregate Capital" means the sum of the Capital of all Purchases.
"Applicable Margin" has the meaning set forth in the Fee Letter.
"Assignee Purchaser" has the meaning set forth in Section 5.3.
"Attorney Costs" means and includes all reasonable fees and
disbursements of any law firm or other external counsel, the reasonable
allocated cost of internal legal services and all reasonable disbursements
of internal counsel.
"Authentic" means Authentic Fitness Products, Inc., a Delaware
corporation.
"Authentic Receivable" means a Receivable sold pursuant to the
Authentic Sale Agreement.
"Authentic Sale Agreement" means the Master Agreement of Sale, dated
as of March 10, 2000 between Authentic and Xxxxxxx, as the same may be
amended, amended and restated, supplemented or other wise modified from
time to time.
"Bankruptcy Code" means the United States Bankruptcy Reform Act of 1978
(11 X.X.X.xx. 101, et seq.), as amended from time to time.
"Base Rate" means, for any day, a fluctuating interest rate per annum
as shall be in effect from time to time, which rate shall be at all times
equal to the higher of:
(a) the rate of interest in effect for such day as publicly
announced from time to time by BNS in New York, New York as its "base
rate". Such "base rate" is based upon various factors, including
their respective costs and desired return, general economic
conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above or below such
announced rates, and
(b) 0.50% per annum above the latest Federal Funds Rate.
"Base Rate Tranche" means a Tranche funded by reference to the Base
Rate.
"Benefit Plan" means any employee benefit pension plan as defined in
Section 3(2) of ERISA in respect of which the Seller, any Originator,
Xxxxxxx or any ERISA Affiliate is, or at any time during the immediately
preceding six years was, an "employer" as defined in Section 3(5) of ERISA.
"BNS" has the meaning set forth in the preamble to the Agreement.
"Breakage Amount" has the meaning set forth in Section 1.14.
"Business Day" means any day (other than a Saturday or Sunday) on
which: (a) banks are not authorized or required to close in New York City,
New York and (b) if this definition of "Business Day" is utilized in
connection with the Eurodollar Rate, dealings are carried out in the London
interbank market.
"Xxxxxx Xxxxx" means Xxxxxx Xxxxx Jeanswear Company, a Delaware
corporation.
"Xxxxxx Xxxxx Sale Agreement" means the Master Agreement of Sale,
dated as of September 30, 1998 between Xxxxxx Xxxxx and Xxxxxxx, as the
same may be amended, amended and restated, supplemented or otherwise
modified from time to time.
"Capital" means with respect to any Purchaser, the aggregate amounts
paid to the Seller by such Purchaser in respect of purchases of interests
in the Purchased Interest pursuant to Section 1.2 of the Agreement, as
reduced from time to time by Collections distributed and applied on account
of such Capital pursuant to Section 1.7(d) of the Agreement; provided, that
if such Capital shall have been reduced by any distribution, and thereafter
all or a portion of such distribution is rescinded or must otherwise be
returned for any reason, such Capital shall be automatically increased by
the amount of such rescinded or returned distribution as though it had not
been made.
"Change in Control" means that Group ceases to own, directly or
indirectly, 100% of the capital stock of the Seller or Xxxxxxx free and
clear of all Adverse Claims other than any pledge of stock of the Seller or
Xxxxxxx to State Street Bank and Trust Company, as Collateral Trustee
pursuant to the Security Agreement, dated as of October 6, 2000 among
Group, Warnaco, the Persons listed on the signature pages thereto,
Additional Grantors (as defined therein) and State Street Bank and Trust
Company as the same may be amended, amended and restarted, supplemented or
otherwise modified from time to time.
"Citibank" means Citibank, N.A.
"Co-Agent" has the meaning set forth in the preamble to the
Agreement.
"Collection Account" means that certain bank account numbered
4071-9191 maintained at Citibank, N.A. in New York, New York which is
identified as the "Warnaco Operations Corporation and The Bank of Nova
Scotia, as Agent: Collection Account".
"Collection Account Agreement" means a letter agreement among the
Seller, the Agent and Citibank, N.A., as the same may be amended,
supplemented, amended and restated, or otherwise modified from time to time
in accordance with the Agreement.
"Collection Account Bank" means Citibank, N.A.
"Collections" means, with respect to any Pool Receivable: (a) all
funds that are received by any Originator, the Seller or the Servicer in
payment of any amounts owed in respect of such Receivable (including
purchase price, finance charges, interest and all other charges), or
applied to amounts owed in respect of such Receivable (including insurance
payments and net proceeds of the sale or other disposition of repossessed
goods or other collateral or property of the related Obligor or any other
Person directly or indirectly liable for the payment of such Pool
Receivable and available to be applied thereon), (b) all Collections deemed
to have been received pursuant to Section 1.12(e) of the Agreement and (c)
all other proceeds of such Pool Receivable.
"Conduit Purchaser" means each Purchaser that is a commercial paper
conduit.
"Contract" means, with respect to any Receivable, any and all
contracts, purchase orders, instruments, agreements, leases, invoices,
notes or other writings pursuant to which such Receivable arises or that
evidence such Receivable or under which an Obligor becomes or is obligated
to make payment in respect of such Receivable.
"Contributed Value" has the meaning set forth in Section 3.4 of the
Xxxxxxx Xxxx Agreement.
"Covered Facility" has the meaning set forth in Annex A to the
Facility Agreement, in effect on the date hereof.
"Credit and Collection Policy" means, as the context may require,
those receivables credit and collection policies and practices of Group in
effect on the date of the Agreement and described in Schedule I to the
Agreement, as modified in compliance with the Agreement.
"Cut-off Date" has the meaning set forth in the Xxxxxxx Xxxx
Agreement.
"Days' Sales Outstanding" means, for any Fiscal Month, an amount
computed as of the last day of such Fiscal Month equal to: (a) the average
of the Outstanding Balance of all Eligible Receivables as of the last day
of each of the three most recent Fiscal Months ended on the last day of
such Fiscal Month divided by (b) Domestic Sales during the three Fiscal
Months ended on or before the last day of such Fiscal Month multiplied by
(c) 90.
"Debt" has the meaning set forth in Annex A to the Facility
Agreement, as in effect on the date hereof.
"Default Event" any Loan Party or any of its Subsidiaries shall fail
to pay any principal of or premium or interest on or any other amount
payable in respect of any Debt that is outstanding in a principal or
reimbursement amount (or, in the case of any Hedge Agreement, its Agreement
Value) of (i) with respect to any Covered Facility, at least $5,000,000 or
(ii) with respect to any other Debt, at least $20,000,000 in the aggregate;
in any case either individually or in the aggregate of such Loan Party or
such Subsidiary (as the case may be), when the same becomes due and payable
whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise, and such failure shall have continued after the applicable grace
period, if any, specified in the agreement or instrument relating to such
Debt (but regardless of whether such failure is waived or the holder(s) of
such Debt in any other manner otherwise excuse such failure); or any other
event shall occur or condition shall exist under any agreement, or
instrument relating to any such Debt as specified in clause (ii) and shall
have continued after the applicable grace period, if any, specified in such
agreement or instrument (but regardless of whether such other event is
waived or the holder(s) of such Debt in any other manner otherwise excuse
such event) if the effect of such event or condition is to accelerate, or
to permit acceleration of, the maturity of such Debt as specified in clause
(ii) or otherwise to cause, or to permit the holder thereof to cause, such
Debt as specified in clause (ii) to mature; or any such Debt as specified
in clause (ii) shall be declared to be due and payable or is then required
to be prepaid or redeemed (other than by a regularly scheduled required
prepayment or redemption), purchased or defeased, or an offer to prepay,
redeem, purchase or defease such Debt as specified in clause (ii) shall be
then required to be made, in each case prior to the stated maturity
thereof.
"Default Ratio" means the ratio (expressed as a percentage and
rounded to the nearest 1/100 of 1%) computed as of the last day of each
Fiscal Month by dividing (i) the aggregate Outstanding
Balance of all Pool Receivables that are Defaulted Receivables as of such
day by (ii) Outstanding Balance of all Pool Receivables.
"Defaulted Receivable" means a Receivable:
(a) in the case of a Receivable that is not an Extended Term
Receivable, as to which any payment, or part thereof, remains unpaid
for 91 days or more from the original due date for such payment,
(b) in the case of a Receivable that is an Extended Term
Receivable, as to which any payment, or part thereof, remains unpaid
for 30 days or more from the original due date for such payment, or
(c) (i) as to which an Event of Bankruptcy shall have occurred
with respect to the Obligor thereof or any other Person obligated
thereon or owning any Related Security with respect thereto, or (ii)
which, has been, or, consistent with the Credit and Collection Policy
would be, written off the Seller's books as uncollectible.
"Delinquency Ratio" means the ratio (expressed as a percentage and
rounded upwards to the nearest 1/100th of 1%) computed as of the last day
of each Fiscal Month of (a) the Outstanding Balance of all Pool Receivables
(other than Defaulted Receivables) as to which any payment, or part
thereof, remains unpaid (i) with respect to such Pool Receivables other
than Pool Receivables that are Extended Term Receivables for more than 60
days from the original stated maturity date for such payment and (ii) with
respect to such Pool Receivables that are Extended Term Receivables for
more than one day after the original due date for such payment, to (b) the
Outstanding Balance of all Pool Receivables.
"Dilution Ratio" means the ratio (expressed as a percentage and
rounded upwards to the nearest 1/100th of 1%) computed as of the last day
of each Fiscal Month of (a) the aggregate amount of payments required to be
made by the Seller pursuant to Section 1.7(e)(i) of the Agreement for such
Fiscal Month, to (b) Domestic Sales during the preceding Fiscal Month.
"Dilution Reserve" for the Purchased Interest means, on any date, an
amount equal to (a) the Aggregate Capital thereof at the close of business
of the Servicer on such date multiplied by (b) the Dilution Reserve
Percentage on such date.
"Dilution Reserve Percentage" means, on any date 15.00%; provided
however, that, upon at least 10 Business Days notice to the Seller, the
Agent may increase such Dilution Reserve Percentage to such greater
percentage as may be necessary based on portfolio performance in the
Agent's sole discretion, to protect the Purchasers against increased
dilution risk with respect to the Pool Receivables; provided, further, that
such Dilution Reserve Percentage shall only be decreased upon unanimous
consent of all Purchasers.
"Discount" means:
for any Tranche for any Interest Period:
(TR x C x ED/Year) + TF
where:
TR = the Tranche Rate for such Tranche for such Interest Period,
C = the Tranche Amount during such Interest Period,
ED = the actual number of days during such Interest Period,
Year = if such Tranche Rate is based upon: (i) the Eurodollar Rate, 360
days, and (ii) the Base Rate, 365 or 366 days, as applicable, and
TF = the Termination Fee, if any, for such Tranche for such Interest
Period;
provided, however, that no provision of the Agreement shall require the
payment or permit the collection of Discount in excess of the maximum
permitted by applicable law; and provided further, that Discount for such
Tranche shall not be considered paid by any distribution to the extent that
at any time all or a portion of such distribution is rescinded or must
otherwise be returned for any reason.
"Discount Reserve" for the Purchased Interest means the sum of (i)
the Termination Discount at such time for such Purchased Interest, and (ii)
the then accrued and unpaid Discount for such Purchased Interest.
"Dollars" means dollars in lawful money of the United States of
America.
"Domestic Pool Receivable" means a Pool Receivable, the Obligor of
which is (a) organized under the laws of the United States or any state
thereof and has its principal place of business located in the United
States or (b) is an Eligible Foreign Obligor.
"Domestic Sales" for any period, means the aggregate amount of new
Domestic Pool Receivables generated by the Originators during such period.
"Eligible Assignee" means (i) a Lender party; (ii) an Affiliate of a
Lender Party; (iii) a commercial bank, savings and loan association or
savings bank organized under the laws of the United States, or any State
thereof, and having total assets in excess of $100,000,000, (iv) a
commercial bank organized under the laws of any other country that is a
member of the Organization of Economic Development and Cooperation (the
"OECD") or has concluded special lending arrangement with the International
Monetary Fund associated with its General Arrangements to Borrow, or a
political subdicision of any such country, and having total assets in
excess of $100,000,000; (v) the central bank of any country that is a
member of the OECD or (vi) a finance company, insurance company or other
financial institution or fund (whether a corporation, partnership, trust or
other entity) having total assets in excess of $100,000,000 that is engaged
in making, purchasing or otherwise investing in commercial loans in the
ordinary course of its business.
"Eligible Foreign Obligor" means an Obligor (i) who is organized
under the laws of a county other than the United States or any state
thereof (ii) whose Receivables are denominated and payable only in Dollars
in the United States and (iii) the obligations of which are supported by a
letter of credit which letter of credit names the Agent as beneficiary for
the benefit of the Purchasers or is in the possession of the Agent.
"Eligible Receivable" means, at any time, a Pool Receivable:
(a) the Obligor of which (i) (A) is organized under the laws of
the United States or any state thereof and has its principal place of
business located in the United States or (B) is an Eligible Foreign
Obligor and (ii) is not an Affiliate of the Seller or Group,
(b) that does not have a stated maturity which is more than 90
days after the original invoice date of such Receivable unless such
Pool Receivable is an Extended Term Receivable, in which case it does
not have a stated maturity which is more than 180 days after the
original invoice date of such Receivable,
(c) that arises under a duly authorized Contract for the sale
and delivery of goods and services in the ordinary course of any
Originator's business,
(d) that arises under a duly authorized Contract that is in
full force and effect and that is a legal, valid and binding
obligation of the related Obligor, enforceable against such Obligor
in accordance with its terms,
(e) that conforms in all material respects with all applicable
laws, rulings and regulations in effect,
(f) that is not the subject of any dispute, offset, hold back
defense, Adverse Claim or other claim other than such adjustments in
the ordinary course of the applicable Originator's business as such
Originator's business is conducted on the date hereof,
(g) that satisfies all applicable requirements of the
applicable Credit and Collection Policy,
(h) that has not been modified, waived or restructured since
its creation,
(i) in which the Seller owns good and marketable title, free
and clear of any Adverse Claims, and that is freely assignable by the
Seller (including without any consent of the related Obligor),
(j) for which the Agent, for the benefit of the Purchasers,
shall have a valid and enforceable undivided percentage ownership or
security interest and a valid and enforceable first priority
perfected security interest therein and in the Related Security and
Collections with respect thereto, in each case free and clear of any
Adverse Claim,
(k) that constitutes an account as defined in the UCC, and that
is not evidenced by instruments or chattel paper,
(l) that is not a Defaulted Receivable,
(m) that represents all or part of the sales price of
merchandise, insurance or services within the meaning of Section
3(c)(5) of the Investment Company Act of 1940,
(n) for which Defaulted Receivables of the related Obligor do
not exceed 25% of the Outstanding Balance of all such Obligor's
Receivables,
(o) which is denominated and payable only in Dollars in the
United States,
(p) that represents amounts earned and payable by the Obligor
that are not subject to the performance of additional services by the
Originator of such Receivable, and
(q) that has not been rewritten, canceled or rebilled or is not
a Pool Receivable that has resulted from a rewritten, canceled or
rebilled Receivable.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statute of similar import,
together with the regulations thereunder, in each case as in effect from
time to time. References to sections of ERISA also refer to any successor
sections.
"ERISA Affiliate" means: (a) any corporation that is a member of the
same controlled group of corporations (within the meaning of Section 414(b)
of the Internal Revenue Code) as the Seller or Group (b) a trade or
business (whether or not incorporated) under common control (within the
meaning of Section 414(c) of the Internal Revenue Code) with the Seller or
Group, or (c) a member of the same affiliated service group (within the
meaning of Section 414(m) of the Internal Revenue Code) as the Seller,
Group, any corporation described in clause (a) or any trade or business
described in clause (b).
"Eurodollar Rate Tranche" means a Tranche funded by reference to the
Eurodollar Rate.
"Event of Bankruptcy" means (a) any case, action or proceeding before
any court or other governmental authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors or (b) any general assignment for the
benefit of creditors of a Person composition, marshaling of assets for
creditors of a Person, or other similar arrangement in respect of its
creditors generally or any substantial portion of its creditors; in each of
cases (a) and (b) undertaken under U.S. Federal, state or foreign law,
including the U.S. Bankruptcy Code.
"Extended Term Receivable" means an Authentic Receivable that has an
original stated maturity that is greater than 90 days after the original
invoice date of such Receivable and less than or equal to 180 days after
the original invoice date of such Receivable.
"Facility Agreement" means the Amendment, Modification, Restatement
and General Provisions Agreement, dated as October 6, 2000 among Group,
Warnaco, the other direct or indirect subsidiaries of Group party thereto
from time to time, BNS, as Administrative Agent, BNS and Citibank, as the
Debt Coordinators and State Street Bank and Trust Company as the Collateral
Trustee, as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time.
"Facility Termination Date" means the earliest to occur of: (a)
August 12, 2002, (b) the date determined pursuant to Section 2.2 of the
Agreement following the occurrence of a Termination Event, and (c) the date
the Purchase Limit reduces to zero pursuant to Section 1.1(b) of the
Agreement.
"Federal Funds Rate" means, for any day, the per annum rate set forth
in the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Board (including any such
successor, "H.15(519)") for such day opposite the caption "Federal Funds
(Effective)." If on any relevant day such rate is not yet published in
H.15(519), the rate for such day will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for
U.S. Government Securities, or any successor publication, published by the
Federal Reserve Bank of New York (including any such successor, the
"Composite 3:30 p.m. Quotations") for such day under the caption "Federal
Funds Effective Rate." If on any relevant day the appropriate rate is not
yet published in either H.15(519) or the Composite 3:30 p.m. Quotations,
the rate for such day will be the arithmetic mean as determined by the
Agent of the rates for the last transaction in overnight Federal funds
arranged before 9:00 a.m. (New York time) on that day by each of three
leading brokers of Federal funds transactions in New York City selected by
the Agent.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System, or any entity succeeding to any of its principal functions.
"Fee Letter" has the meaning set forth in Section 1.8 of the
Agreement.
"Fees" means the fees payable by the Seller to the Purchasers
pursuant to the Fee Letter.
"Final Payout Date" means the date following the Facility Termination
Date on which the Aggregate Capital and Discount on all Tranches shall have
been paid in full and all the amounts owed by the Seller and the Servicer
under the Transaction Documents shall have been paid in full.
"Fiscal Month" means, with respect to any date, the monthly period
designated with respect to such date on Schedule III hereto, as such
Schedule may be modified or replaced from time to time.
"GAAP" means the generally accepted United States accounting
principles promulgated or adopted by the Financial Accounting Standards
Board and its predecessors and successors from time to time.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary
or regulatory authority) thereof, any body or entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government, including any court, and any Person owned or
controlled, through stock or capital ownership or otherwise, by any of the
foregoing.
"Xxxxxxx" has the meaning set forth in the preamble to the Agreement.
"Xxxxxxx Xxxx Agreement" means the Purchase and Sale Agreement, dated
as of September 30, 1998, between the Seller and Xxxxxxx, as such agreement
may be amended, amended and restated, supplemented or otherwise modified
from time to time.
"Group" means Warnaco Group, Inc., a Delaware corporation.
"Hedge Agreements" has the meaning set forth in Annex A to the
Facility Agreement, in effect on the date hereof.
"Impermissible Qualification" means, relative to the opinion or
certification of any independent public accountant as to any financial
statement of Seller or Group any qualification or exception to such opinion
or certification:
(i) which is of a "going concern" or similar nature; or
(ii) which relates to the limited scope of examination of
matters relevant to such financial statement (other than any standard
qualification of such nature).
"Indemnified Amounts" has the meaning set forth in Section 3.1 of the
Agreement.
"Indemnified Party" means the Agent, the Co-Agent, the Purchasers,
any Program Support Provider or any of their respective Affiliates,
employees, officers, directors, agents, counsel, successors, transferees or
assigns.
"Independent Director" has the meaning set forth in paragraph 3(c) of
Exhibit IV to the Agreement.
"Insolvency Proceeding" means: (a) any case, action or proceeding
before any court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the
benefit of creditors, composition, marshaling of assets for creditors, or
other, similar arrangement in respect of its creditors generally or any
substantial portion of its creditors, in each case undertaken under U.S.
Federal, state or foreign law, including the Bankruptcy Code.
"Intercreditor Agreement" means the Agreement dated as of October 6,
2000 among Group, Warnaco, BNS, as Administrative Agent, BNS and Xxxxxxx
Xxxxx Barney Inc., as Lead Arrangers, BNS and Citibank, N.A., as Debt
Coordinators, BNS, Xxxxxxx Xxxxx Barney Inc., Xxxxxx Guaranty Trust Company
of New York, Commerzbank A.G., New York Branch and Societe Generale, as
Arrangers, the other financial from time to time party thereto and State
Street Bank and Trust Company, as Collateral Trustee, as amended, amended
and restated, supplemented or otherwise modified from time to time.
"Interest Period" means (a) with respect to a Eurodollar Rate
Tranche, the period commencing on (and including) the date of the initial
funding of, continuance of or conversion into a Eurodollar Rate Tranche
pursuant to Section 1.2 or 1.3 and ending on (but excluding) the day which
is one, two or three months thereafter (or, if such month has no
numerically corresponding day, on the last Business Day of such month) as
the Seller may select in its relevant notice pursuant to Section 1.2 or 1.3
and (b) with respect to a Base Rate Tranche (i) initially the period
commencing on (and including) the date of the initial funding of,
continuance of or conversion into a Base Rate Tranche pursuant to Section
1.2 or 1.3 and ending on (and including) the last day of the current
calendar month, and (ii) thereafter, the period commencing on (and
including) the first day after the last day of the immediately preceding
Interest Period for such Base Rate Tranche and ending on (and including)
the last day of the current calendar month; provided, that
(A) any Interest Period (other than of one day) which
would otherwise end on a day which is not a Business Day shall
be extended to the next succeeding Business Day; provided,
however, if Discount in respect of such Interest Period is
computed by reference to the Eurodollar Rate, and such Interest
Period would otherwise end on a day which is not a Business
Day, and there is no subsequent Business Day in the same
calendar month as such day, such Interest Period shall end on
the next preceding Business Day; and
(B) in the case of any Interest Period for any Tranche
that commences before the Facility Termination Date and would
otherwise end on a date occurring after the Facility
Termination Date, such Interest Period shall end on such
Facility Termination Date and the duration of each Interest
Period which commences on or after the Facility Termination
Date shall be of such duration as shall be selected by the
Agent.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and any successor statute of similar import,
together with the regulations thereunder, in each case as in effect from
time to time. References to sections of the Internal Revenue Code also
refer to any successor sections.
"Lender Parties" has the meaning set forth in Annex A to the Facility
Agreement, as in effect on the date hereof.
"Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on
title to real property.
"Loan Parties" has the meaning set forth in Annex A to the Facility
Agreement, as in effect on the date hereof.
"Loss-to-Liquidation Ratio" means the ratio (expressed as a
percentage and rounded upward to the nearest 1/100th of 1%) computed as of
the last day of each Fiscal Month by dividing (a) the sum of (i) the
aggregate Outstanding Balance of all Domestic Pool Receivables written off
by the Seller or Servicer, or which should have been written off by the
Seller or Servicer in accordance with the Credit and Collection Policy,
during such Fiscal Month plus (ii) 50% of the aggregate Outstanding Balance
of all Domestic Pool Receivables as to which any payment, or part thereof,
remains unpaid for more than 120 days from the original due date for such
payment by (b) the aggregate amount of Collections of Domestic Pool
Receivables (other than deemed Collections) during such fiscal month.
"Loss Reserve" for the Purchased Interest means, on any date, an
amount equal to (a) the Aggregate Capital at the close of business of the
Servicer on such date multiplied by (b) the Loss Reserve Percentage on such
date.
"Loss Reserve Percentage" means, on any date 10.00%; provided,
however, that until such time as the Servicer or the Seller shall have
delivered the initial Weekly Report the "Loss Reserve Percentage" means on
any date 15.00%; provided however, that, upon at least 10 Business Days
notice to the Seller, the Agent may increase such Loss Reserve Percentage
to any such greater percentage as may be necessary based on portfolio
performance in the Agent's sole discretion to protect the Purchasers
against increased credit risk with respect to the Pool Receivables amount;
provided, further, that such Loss Reserve Percentage shall only be
decreased upon unanimous consent of all Purchasers.
"Material Adverse Effect" means, relative to any Person with respect
to any event or circumstance, a material adverse effect on:
(a) the assets, operations, business or financial condition of
such Person,
(b) the ability of any such Person to perform its obligations
under the Agreement or any other Transaction Document to which it is
a party,
(c) the validity or enforceability of any other Transaction
Document, or the validity, enforceability or collectibility of a
material portion of the Pool Receivables, or
(d) the status, perfection, enforceability or priority of the
Agent or any Purchaser's or the Seller's interest in the Pool Assets.
"Monthly Net Charge Back Amount" means the amount shown as the "U.S.
Domestic Net Charge Back Amount" on the most recent Monthly Report less
advertising, allowances and returns.
"Monthly Report" means a report, in substantially the form of Annex A
to the Agreement, furnished to the Agent pursuant to the Agreement.
"Monthly Report Date" means the seventeenth day of each calendar
month (or if such day is not a Business Day, then the next following
Business Day).
"Moody's" means Xxxxx'x Investors Service, Inc., and its successors.
"Net Receivables Pool Balance" means, at any time: (a) the
Outstanding Balance of Eligible Receivables then in the Receivables Pool
minus (b) the amount of Collections of such Receivables that have been
received by the Servicer but not yet applied to such Receivable at such
time, plus (c) the Permitted Dilution Amount.
"Notes" means with respect to any Conduit Purchaser, the short-term
promissory notes issued, or to be issued, by such Conduit Purchaser to fund
its investments in accounts receivable or other financial assets.
"Obligor" means, with respect to any Receivable, the Person obligated
to make payments pursuant to the Contract relating to such Receivable.
"Originator" means any of Warnaco, Authentic or Xxxxxx Xxxxx or their
respective successors and permitted assigns.
"Outstanding Balance" of any Receivable at any time means the then
outstanding principal balance thereof.
"Payment Date" has the meaning set forth in Section 1.4 of the
Xxxxxxx Xxxx Agreement.
"Percentage" means with respect to any Purchaser the percentage set
forth below its signature to the Agreement or in the Purchaser Assignment
Agreement pursuant to which it became a Purchaser, as such percentage may
be modified in connection with any subsequent Purchaser Assignment
Agreement to which such Purchaser is a party that is accepted by the Agent
in accordance with Section 6.3.
"Permitted Dilution Amount" means at any time 50% of the Monthly Net
Charge Back Amount.
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association,
joint venture, limited liability company or other entity, or a government
or any political subdivision or agency thereof.
"Pool Assets" has the meaning set forth in Section 1.2(e) of the
Agreement.
"Pool Receivable" means a Receivable in the Receivables Pool.
"Program Support Provider" means and includes any Person now or
hereafter extending credit or having a commitment to extend credit to or
for the account of, or to make purchases from, any Conduit Purchaser
pursuant to any program support agreement for the purpose of providing
liquidity or credit enhancement for the Notes issued by such Conduit
Purchaser.
"Purchase and Sale Indemnified Amounts" has the meaning set forth in
Section 8.1 of the Xxxxxxx Xxxx Agreement.
"Purchase and Sale Indemnified Party" has the meaning set forth in
Section 8.1 of the Xxxxxxx Xxxx Agreement.
"Purchase and Sale Termination Date" has the meaning set forth in
Section 1.4 of the Xxxxxxx Xxxx Agreement.
"Purchase and Sale Termination Event" has the meaning set forth in
Section 7.1 of the Xxxxxxx Xxxx Agreement.
"Purchase Facility" has the meaning set forth in Section 1.1 of the
Xxxxxxx Xxxx Agreement.
"Purchase Limit" means $300,000,000, as such amount may be (a)
reduced pursuant to Section 1.1(b) or (b) increased upon the request of the
Seller and with the consent of the Purchasers; it being understood that no
Purchaser shall be under no obligation to consent to an increase in the
Purchase Limit at any time and that such consent may be withheld by the
Purchasers in their sole and absolute discretion without regard to whether
such consent has been unreasonably withheld. References to the unused
portion of the Purchase Limit shall mean, at any time, the excess of the
Purchase Limit (as then reduced pursuant to Section 1.1(b) or as then
increased pursuant to the preceding sentence), over the then outstanding
Aggregate Capital.
"Purchase Price" has the meaning set forth in Section 2.1 of the
Xxxxxxx Xxxx Agreement.
"Purchase Report" has the meaning set forth in Section 2.1 of the
Xxxxxxx Xxxx Agreement.
"Purchase Request" means a purchase request and certificate duly
executed by an authorized officer of the Seller, substantially in the form
of Annex B hereto.
"Purchased Interest" means, at any time, an undivided percentage
ownership interest in: (a) each and every Pool Receivable now existing or
hereafter arising, (b) all Related Security with respect to such Pool
Receivables and (c) all Collections with respect to, and other proceeds of,
such Pool Receivables and Related Security. Such undivided percentage
interest shall be computed as:
Capital + Total Reserves
_____________________________
Net Receivables Pool Balance
The Purchased Interest shall be determined from time to time pursuant to
Section 1.4 of the Agreement.
"Purchaser Assignment Agreement" means a purchaser assignment
agreement substantially in the form of Annex E to the Agreement.
"Purchasers" has the meaning set forth in the preamble to the
Agreement.
"Purchaser's Pro Rata Share" means with respect to any Purchaser a
fraction, expressed as a percentage, the numerator of which is the
outstanding Capital of such Purchaser and the denominator of which is the
Aggregate Capital.
"Purchasers' Share" with respect to any amount means such amount
multiplied by the Purchased Interest at the time of determination.
"Rate Type" means the Eurodollar Rate or the Base Rate.
"Rate Variance Factor" means the number, computed from time to time
in good faith by the Agent, that reflects the largest potential variance
(from minimum to maximum) in selected interest rates over a period of time
selected by the Agent from time to time, as set forth in a written notice
by the Agent to the Seller and the Servicer; provided that the Rate
Variance Factor shall at no time exceed 1%.
"Receivable" means any indebtedness and other obligations owed to the
Seller as assignee of the Originators or any Originator by, or any right of
the Seller or any Originator to payment from or on behalf of, an Obligor),
whether constituting an account, chattel paper, instrument or general
intangible arising in connection with the sale of goods or the rendering of
services by the Originator, and includes the obligation to pay any finance
charges, fees and other charges with respect thereto.
"Receivables Pool" means, at any time, all of the then outstanding
Receivables purchased or purported to be purchased by the Seller or
contributed to the Seller pursuant to the Xxxxxxx Xxxx Agreement prior to
the Facility Termination Date.
"Related Rights" has the meaning set forth in Section 1.1 of the
Xxxxxxx Xxxx Agreement.
"Related Security" means, with respect to any Receivable:
(a) all of the Seller's, Xxxxxxx'x and each Originator's
interest in any goods (including returned goods), and documentation
of title evidencing the shipment or storage of any goods (including
returned goods), relating to any sale giving rise to such Receivable,
(b) all instruments and chattel paper that may evidence such
Receivable,
(c) all other security interests or liens and property subject
thereto from time to time purporting to secure payment of such
Receivable, whether pursuant to the Contract related to such
Receivable or otherwise, together with all UCC financing statements
or similar filings relating thereto, and
(d) all of the Seller's, Xxxxxxx'x and each Originator's
rights, interests and claims under the Contracts and all guaranties,
indemnities and other agreements (including the related Contract) or
arrangements of whatever character from time to time supporting or
securing payment of such Receivable or otherwise relating to such
Receivable, whether pursuant to the Contract related to such
Receivable or otherwise.
"Replacement Purchaser" has the meaning set forth in Section 5.3(c)
of the Agreement.
"Required Lenders" has the meaning set forth in Annex A to the
Facility Agreement, as in effect on the date hereof.
"Required Purchasers" means, at any time, Purchasers whose Capital
aggregates more than 51% of the Aggregate Capital.
"Seller" has the meaning set forth in the preamble to the Agreement.
"Seller's Share" of any amount means the greater of: (a) $0 and (b)
the product of (i) such amount multiplied by (ii) a percentage equal to (A)
100% minus (B) the Purchased Interest (expressed as a percentage).
"Servicer" has the meaning set forth in the preamble to the
Agreement.
"Servicing Fee" shall mean the fee referred to in Section 4.6 of the
Agreement.
"Servicing Fee Rate" shall mean the rate referred to in Section
4.6(a) of the Agreement.
"Servicing Fee Reserve" with respect to the Purchased Interest at any
time means the sum of (a) the then accrued and unpaid Servicing Fee
relating to the Purchased Interest plus (b) the product of (i) Aggregate
Capital at such time, times (ii) the product of (x) the Servicing Fee Rate
divided by one minus the Servicing Fee Rate multiplied by (y) a fraction,
the numerator of which is 1.5 times the Days' Sales Outstanding (calculated
on the last day of the most recent preceding Fiscal Month) and the
denominator of which is 360.
"Settlement Date" means (a) prior to the Facility Termination Date
(i) with respect to the payment of accrued and unpaid Discount with respect
to any Tranche, the last day of each Interest Period for such Tranche and
(ii) with respect to the payment of all other amounts hereunder, the fifth
day of each calendar month (or if such day is not a Business Day, then the
next following Business Day) as notified to the Seller by the Agent and (b)
on or after the Facility Termination Date, with respect to the payment of
accrued and unpaid Discount with respect to any Tranche or the payment of
all other amounts hereunder as notified to the Seller by the Agent each day
selected from time to time by the Agent (it being understood that the Agent
may select such Settlement Date(s) to occur as frequently as daily), or, in
the absence of any such selection, the day which would be the Settlement
Date for such Tranche or other amounts pursuant to clause (a)(i) or
(a)(ii), as applicable, of this definition.
"Solvent" means, with respect to any Person at any time, a condition
under which:
(i) the fair value and present fair saleable value of such
Person's total assets is, on the date of determination, greater than
such Person's total liabilities (including contingent and
unliquidated liabilities) at such time;
(ii) the fair value and present fair saleable value of such
Person's assets is greater than the amount that will be required to
pay such Person's probable liability on its existing debts as they
become absolute and matured ("debts," for this purpose, includes all
legal liabilities, whether matured or unmatured, liquidated or
unliquidated, absolute, fixed, or contingent);
(iii) such Person is and shall continue to be able to pay all
of its liabilities as such liabilities mature; and
(iv) such Person does not have unreasonably small capital with
which to engage in its current and in its anticipated business.
For purposes of this definition:
(A) the amount of a Person's contingent or unliquidated
liabilities at any time shall be that amount which, in light of all
the facts and circumstances then existing, represents the amount
which can reasonably be expected to become an actual or matured
liability;
(B) the "fair value" of an asset shall be the amount which may
be realized within a reasonable time either through collection or
sale of such asset at its regular market value;
(C) the "regular market value" of an asset shall be the amount
which a capable and diligent business person could obtain for such
asset from an interested buyer who is willing to Purchase such asset
under ordinary selling conditions; and
(D) the "present fair saleable value" of an asset means the
amount which can be obtained if such asset is sold with reasonable
promptness in an arm's-length transaction in an existing and not
theoretical market.
"Standard & Poor's" means Standard & Poor's, a division of The
XxXxxx-Xxxx Companies, Inc., and its successors.
"Subordinated Note" has the meaning set forth in Section 3.2 of the
Xxxxxxx Xxxx Agreement.
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which)
more than 50% of (a) the issued and outstanding capital stock having
ordinary voting power to elect a majority of the Board of Directors of such
corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting power upon
the occurrence of any contingency), (b) the interest in the capital or
profits of such partnership, joint venture or limited liability company or
(c) the beneficial interest in such trust or estate is at the time directly
or indirectly owned or controlled by such Person, by such Person and one or
more of its other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"Termination Day" means: (a) each day on which the conditions set
forth in Section 2 of Exhibit II to the Agreement are not satisfied or (b)
each day that occurs on or after the Facility Termination Date.
"Termination Discount" means, for the Purchased Interest on any date,
an amount equal to the product of (i) the Aggregate Capital on such date
and (ii) the product of (a) the Base Rate plus the Rate Variance Factor and
(b) a fraction having as its numerator the Days' Sales Outstanding and 360
as its denominator.
"Termination Event" has the meaning specified in Exhibit V to the
Agreement.
"Termination Fee" means, for any Tranche and the related Interest
Period during which a Termination Day occurs, the amount, if any, by which:
(a) the additional Discount (calculated without taking into account any
Termination Fee or any shortened duration of such Interest Period pursuant
to the definition thereof) that would have accrued during such Interest
Period on the reductions of the Tranche Amount relating to such Interest
Period had such reductions not been made, exceeds (b) the income, if any,
received by the Purchasers from investing the proceeds of such reductions
of the Tranche Amount, as determined by the Purchasers, which determination
shall be binding and conclusive for all purposes, absent manifest error.
"Total Reserves" means, at any time the sum of : (a) the Loss Reserve
plus (b) the Dilution Reserve plus (c) the Discount Reserve plus (d) the
Servicing Fee Reserve.
"Tranche" has the meaning set forth in Section 1.2(c) of the
Agreement.
"Tranche Amount" means, at any time, with respect to any Tranche, the
portion of the Aggregate Capital allocated to such Tranche.
"Tranche Rate" for any Interest Period for any Tranche of any
Purchased Interest means an interest rate per annum equal to the rate
determined pursuant to Section 1.5.
"Transaction Documents" means the Agreement, the Collection Account
Agreement, the Fee Letter, the Warnaco Sale Agreement, the Authentic Sale
Agreement, the Xxxxxx Xxxxx Sale Agreement, the Xxxxxxx Xxxx Agreement and
all other certificates, instruments, UCC financing statements, reports,
notices, agreements and documents executed or delivered under or in
connection with the Agreement, in each case as the same may be amended,
supplemented or otherwise modified from time to time in accordance with the
Agreement.
"Transferee" has the meaning set forth in Section 5.5.
"UCC" means the Uniform Commercial Code as from time to time in
effect in the applicable jurisdiction.
"Unmatured Purchase and Sale Termination Event" means any event
which, with the giving of notice or lapse of time, or both, would become a
Purchase and Sale Termination Event.
"Unmatured Termination Event" means an event that, with the giving of
notice or lapse of time, or both, would constitute a Termination Event.
"Warnaco" means Warnaco Inc., a Delaware corporation.
"Warnaco Sale Agreement" means the Amended and Restated Master
Agreement of Sale, dated as of September 30, 1998, between Warnaco and
Xxxxxxx, as such agreement may be amended, amended and restated,
supplemented or otherwise modified from time to time.
"Weekly Report" means a report, together with an officer's certified
certificate attached thereto, in substantially the form of Annex D to the
Agreement.
"Weekly Report Date" means the last Business Day of each week.
Other Terms. All accounting terms not specifically defined herein
shall be construed in accordance with generally accepted accounting
principles. All terms used in Article 9 of the UCC in the State of New
York, and not specifically defined herein, are used herein as defined in
such Article 9. Unless the context otherwise requires, "or" means "and/or,"
and "including" (and with correlative meaning "include" and "includes")
means including without limiting the generality of any description
preceding such term.
EXHIBIT II
CONDITIONS PRECEDENT
1. Conditions Precedent to Effectiveness of Agreement. The
effectiveness of this Agreement is subject to the following conditions
precedent that the Agent shall have received on or before the date of such
purchase, each in form and substance (including the date thereof)
satisfactory to the Agent:
(a) A counterpart of the Agreement and the other Transaction
Documents executed by the parties thereto.
(b) Certified copies of: (i) the resolutions of the Board of
Directors of each of the Seller, the Originators and Xxxxxxx authorizing
the execution, delivery and performance by the Seller, each Originator and
Xxxxxxx, as the case may be, of the Agreement and the other Transaction
Documents to which it is a party; (ii) all documents evidencing other
necessary corporate action and governmental approvals, if any, with respect
to the Agreement and the other Transaction Documents and (iii) the
certificate of incorporation and by-laws of the Seller, each Originator and
Xxxxxxx.
(c) A certificate of the Secretary or Assistant Secretary of the
Seller, each Originator and Xxxxxxx certifying the names and true
signatures of its officers who are authorized to sign the Agreement and the
other Transaction Documents. Until the Agent receives a subsequent
incumbency certificate from the Seller, each Originator or Xxxxxxx, as the
case may be, the Agent shall be entitled to rely on the last such
certificate delivered to it by the Seller, such Originator or Xxxxxxx, as
the case may be.
(d) Copies of duly executed financing statements, in proper form for
filing under the UCC of all jurisdictions that the Agent may deem necessary
or desirable in order to perfect the interests of the Seller, the Agent and
the Purchasers contemplated by the Transaction Documents.
(e) Acknowledgment copies, or time-stamped receipt copies, of proper
financing statements, if any, necessary to release all security interests
and other rights of any Person in the Receivables, Contracts or Related
Security previously granted by any Originator, Xxxxxxx or the Seller.
(f) Completed UCC search reports, dated on or shortly before the date
of this Agreement, listing the financing statements filed in all applicable
jurisdictions referred to in subsection (e) above that name any Originator,
Xxxxxxx or the Seller as debtor, together with copies of such other
financing statements, and similar search reports with respect to judgment
liens, federal tax liens and liens of the Pension Benefit Guaranty
Corporation in such jurisdictions, as the Agent may request, showing no
Adverse Claims on any Pool Assets.
(g) an executed copy of the Collection Account Agreement.
(h) Favorable opinions, including a true sale/non-substantive
consolidation opinion, in form and substance reasonably satisfactory to the
Agent, of: (i) special counsel for the Seller, the Originators and the
Servicer, and (ii) Xxxxxxx X. Xxxxxxxxxxx, counsel for Seller, the
Originators and the Servicer.
(i) [RESERVED]
(j) A Monthly Report representing the performance of the Receivables
Pool for the Fiscal Month ending August 31, 2000.
(k) Evidence of payment by the Seller of all accrued and unpaid fees
(including those contemplated by the Fee Letter), costs and expenses to the
extent then due and payable and invoiced on the date thereof, including any
such costs, fees and expenses arising under or referenced in Section 5.4 of
the Agreement and the Fee Letter.
(l) The Fee Letter duly executed by the Seller.
(m) Good standing certificates with respect to each of the Seller,
the Originators and Xxxxxxx issued by the Secretary of State (or similar
official) of the state of each such Person's organization and principal
place of business.
(n) Letters from each of the rating agencies then rating the Notes of
Liberty Street confirming the rating of such Notes after giving effect to
the transaction contemplated by the Agreement.
(o) The other Transaction Documents duly executed by the parties
thereto.
(p) Such other approvals, opinions or documents as the Agent may
reasonably request.
2. Conditions Precedent to All Purchases and Reinvestments. Each
purchase and each reinvestment under this Agreement shall be subject to the
further conditions precedent that:
(a) on the date of such purchase (including the initial purchase) or
reinvestment the following statements shall be true (and acceptance of the
proceeds of such purchase or reinvestment shall be deemed a representation
and warranty by the Seller that such statements are then true):
(i) the representations and warranties contained in Exhibit III
to the Agreement are true and correct in all material respects on and
as of the date of such purchase or reinvestment as though made on and
as of such date;
(ii) no event has occurred and is continuing, or would result
from such purchase or reinvestment, that constitutes a Termination
Event or an Unmatured Termination Event; provided, however, that it
shall not be a condition precedent to any reinvestment that a
Termination Event or Unmatured Termination Event described in
paragraph (j) of Exhibit V shall not have occurred unless and until
the Agent is permitted pursuant to Section 2.2(b),
to exercise any right, remedy or power available to it hereunder
(other than under the proviso to Section 2.2(b) of the Receivables
Purchase Agreement) or pursuant to applicable law as a result of the
occurrence of such Termination Event;
(iii) solely in the case of any purchase (but not
reinvestment), no Default Event shall have occurred and is
continuing; and
(iv) the sum of (a) the Aggregate Capital and (b) Total
Reserves of the Purchased Interest would not exceed the Net
Receivables Pool Balance.
EXHIBIT III
REPRESENTATIONS AND WARRANTIES
1. Representations and Warranties of the Seller. The Seller
represents and warrants as follows:
(a) The Seller is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware, and is duly
qualified to do business and is in good standing as a foreign corporation
in every jurisdiction where the nature of its business requires it to be so
qualified, except where the failure to be so qualified would not have a
Material Adverse Effect.
(b) The execution, delivery and performance by the Seller of the
Agreement and the other Transaction Documents to which it is a party,
including its use of the proceeds of purchases and reinvestments: (i) are
within its corporate powers; (ii) have been duly authorized by all
necessary corporate action; (iii) do not contravene in any material respect
or result in a default under or conflict with: (A) its charter or by-laws,
(B) any law, rule or regulation applicable to it, (C) any indenture, loan
agreement, mortgage, deed of trust or other agreement or instrument to
which it is a party or by which it is bound, or (D) any order, writ,
judgment, award, injunction or decree binding on or affecting it or any of
its property; and (iv) do not result in or require the creation of any
Adverse Claim upon or with respect to any of its properties.
(c) No authorization, approval or other action by, and no notice to
or filing with, any Governmental Authority or other Person is required for
the due execution, delivery and performance by the Seller of the Agreement
or any other Transaction Document to which it is a party, other than the
Uniform Commercial Code filings referred to in Exhibit II to the Agreement,
all of which shall have been filed on or before the date of the first
purchase hereunder.
(d) Each of the Agreement and the other Transaction Documents to
which it is a party has been duly executed and delivered by the Seller and
constitutes its legal, valid and binding obligation of the Seller
enforceable against the Seller in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or
other similar laws from time to time in effect affecting the enforcement of
creditors' rights generally and by general principles of equity, regardless
of whether such enforceability is considered in a proceeding in equity or
at law.
(e) There is no pending or, to the Seller's best knowledge,
threatened action or proceeding affecting the Seller or any of its
properties before any Governmental Authority or arbitrator.
(f) No proceeds of any purchase or reinvestment will be used by the
Seller to acquire any equity security of a class that is registered
pursuant to Section 12 of the Securities Exchange Act of 1934.
(g) The Seller is the legal and beneficial owner of the Pool
Receivables and Related Security, free and clear of any Adverse Claim. Upon
each purchase or reinvestment, each Purchaser, through the Agent, shall
acquire a valid and enforceable perfected undivided percentage ownership or
security interest in each Pool Receivable then existing or thereafter
arising and in the Related Security, Collections and other proceeds with
respect thereto, free and clear of any Adverse Claim. The Agreement creates
a security interest in favor of the Agent, for the benefit of the
Purchasers, in the Pool Assets, and the Agent on behalf of the Purchasers,
has a first priority perfected security interest in the Pool Assets, free
and clear of any Adverse Claims. No effective financing statement or other
instrument similar in effect covering any Pool Asset is on file in any
recording office, except those filed in favor of (A) Xxxxxxx pursuant to
the Warnaco Sale Agreement, the Authentic Sale Agreement and the Xxxxxx
Xxxxx Sale Agreement, (B) the Seller pursuant to the Xxxxxxx Xxxx Agreement
and (C) the Agent relating to the Agreement.
(h) Each Monthly Report and each Weekly Report (if prepared by the
Seller or one of its Affiliates, or to the extent that information
contained therein is supplied by the Seller or an Affiliate), information,
exhibit, financial statement, document, book, record or report furnished or
to be furnished at any time by or on behalf of the Seller to the Agent, the
Co-Agent and the Purchasers in connection with the Agreement or any other
Transaction Document to which it is a party is or will be complete and
accurate in all material respects as of its date or as of the date so
furnished.
(i) The Seller's principal place of business and chief executive
office (as such terms are used in the UCC) and the office where it keeps
its records concerning the Receivables are located at the address referred
to in Sections 1(b) and 2(b) of Exhibit IV to the Agreement.
(j) The Seller is not in violation of any order of any court,
arbitrator or Governmental Authority, the violation of which would have a
Material Adverse Effect on the Seller.
(k) No proceeds of any purchase or reinvestment will be used for any
purpose that violates any applicable law, rule or regulation, including
Regulation U of the Federal Reserve Board.
(l) Each Pool Receivable included as an Eligible Receivable in the
calculation of the Net Receivables Pool Balance is an Eligible Receivable.
(m) No event has occurred and is continuing, or would result from a
purchase in respect of, or reinvestment in respect of, the Purchased
Interests or from the application of the proceeds therefrom, that
constitutes a Termination Event or an Unmatured Termination Event.
(n) The Seller has complied in all material respects with the Credit
and Collection Policy.
(o) The Seller has complied in all material respects with all of the
terms, covenants and agreements contained in the Agreement and the other
Transaction Documents that are applicable to it.
(p) The Seller's complete corporate name is set forth in the preamble
to the Agreement, and it does not use and has not since its incorporation
used any other corporate name, trade name, doing-business name or
fictitious name, except as set forth on Schedule II to the Agreement and
except for names first used after the date of the Agreement and set forth
in a notice delivered to the Agent pursuant to Section 1(i)(iv) of Exhibit
III to the Agreement.
(q) The Seller is not an "investment company," or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended. In addition, the Seller is not
a "holding company," a "subsidiary company" of a "holding company" or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company" within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
2. Representations and Warranties of Xxxxxxx (including in its
capacity as the Servicer). Xxxxxxx, individually and in its capacity as the
Servicer, represents and warrants as follows:
(a) Xxxxxxx is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and is duly
qualified to do business and is in good standing as a foreign corporation
in every jurisdiction where the nature of its business requires it to be so
qualified, except where the failure to be so qualified would not have a
Material Adverse Effect.
(b) The execution, delivery and performance by Xxxxxxx of the
Agreement and the other Transaction Documents to which it is a party,
including the Servicer's use of the proceeds of purchases and
reinvestments: (i) are within its corporate powers; (ii) have been duly
authorized by all necessary corporate action; (iii) do not contravene in
any material respect or result in a default under or conflict with: (A) its
charter or by-laws, (B) any law, rule or regulation applicable to it, (C)
any indenture, loan agreement, mortgage, deed of trust or other material
agreement or instrument to which it is a party or by which it is bound, or
(D) any order, writ, judgment, award, injunction or decree binding on or
affecting it or any of its property; and (iv) do not result in or require
the creation of any Adverse Claim upon or with respect to any of its
properties. The Agreement and the other Transaction Documents to which
Xxxxxxx is a party have been duly executed and delivered by Xxxxxxx.
(c) No authorization, approval or other action by, and no notice to
or filing with any Governmental Authority or other Person, is required for
the due execution, delivery and performance by Xxxxxxx of the Agreement or
any other Transaction Document to which it is a party.
(d) Each of the Agreement and the other Transaction Documents to
which Xxxxxxx is a party constitutes the legal, valid and binding
obligation of Xxxxxxx enforceable against Xxxxxxx in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws from time to time in effect affecting
the enforcement of creditors' rights generally and by general principles of
equity, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(e) The balance sheets of Group and its consolidated Subsidiaries as
at January 3, 2000, and the related income and retained earnings for the
fiscal year then ended, copies of which have been furnished to the Agent
and the Co-Agent, fairly present the financial condition of Group and its
consolidated Subsidiaries as at such date and the results of the operations
of Group and its Subsidiaries for the period ended on such date, all in
accordance with generally accepted accounting principles consistently
applied, and since January 3, 2000 there has been no event or circumstances
which has had a Material Adverse Effect.
(f) Except as disclosed in the most recent audited financial
statements of Xxxxxxx furnished to the Agent, there is no pending or, to
its best knowledge, threatened action or proceeding affecting it or any of
its Subsidiaries before any Governmental Authority or arbitrator that would
have a Material Adverse Effect.
(g) Each Monthly Report and each Weekly Report (if prepared by
Xxxxxxx or one of its Affiliates, or to the extent that information
contained therein is supplied by Xxxxxxx or an Affiliate), information,
exhibit, financial statement, document, book, record or report furnished or
to be furnished at any time by or on behalf of the Servicer to the Agent in
connection with the Agreement is or will be complete and accurate in all
material respects as of its date or (except as otherwise disclosed to the
Agent at such time) as of the date so furnished.
(h) Xxxxxxx is not in violation of any order of any court, arbitrator
or Governmental Authority, which could reasonably be expected to have a
Material Adverse Effect.
(i) Xxxxxxx has complied in all material respects with the Credit and
Collection Policy.
EXHIBIT IV
COVENANTS
1. Covenants of the Seller. Until the Final Payout Date:
(a) Compliance with Laws, Etc. The Seller shall comply in all
material respects with all applicable laws, rules, regulations and orders,
and preserve and maintain its corporate existence, rights, franchises,
qualifications and privileges, except to the extent that the failure so to
comply with such laws, rules and regulations or the failure so to preserve
and maintain such rights, franchises, qualifications and privileges would
not have a Material Adverse Effect.
(b) Offices, Records and Books of Account, Etc. The Seller: (i) shall
keep its principal place of business and chief executive office (as such
terms or similar terms are used in the UCC) and the office where it keeps
its records concerning the Receivables at the address of the Seller set
forth under its name on the signature page to the Agreement or, pursuant to
clause (j)(iv) below, at any other locations in jurisdictions where all
actions reasonably requested by the Agent to protect and perfect the
interest of the Agent, for the benefit of the Purchasers, in the
Receivables and related items (including the Pool Assets) have been taken
and completed and (ii) shall provide the Agent with at least 30 days'
written notice before making any change in the Seller's name or making any
other change in the Seller's identity or corporate structure (including a
Change in Control) that could render any UCC financing statement filed in
connection with this Agreement "seriously misleading" as such term (or
similar term) is used in the UCC; each notice to the Agent pursuant to this
sentence shall set forth the applicable change and the effective date
thereof. The Seller also will maintain and implement (or cause the Servicer
to maintain and implement) administrative and operating procedures
(including an ability to recreate records evidencing Receivables and
related Contracts in the event of the destruction of the originals
thereof), and keep and maintain (or cause the Servicer to keep and
maintain) all documents, books, records, computer tapes and disks and other
information reasonably necessary or advisable for the collection of all
Receivables (including records adequate to permit, as and when necessary,
the daily identification of each Receivable and all Collections of and
adjustments to each existing Receivable).
(c) Performance and Compliance with Contracts and Credit and
Collection Policy. The Seller shall (and shall cause the Servicer to) fully
comply in all material respects with the Credit and Collection Policy.
(d) Ownership Interest, Etc. The Seller shall (and shall cause the
Servicer to), at its expense, take all action necessary or desirable to
establish and maintain a valid and enforceable undivided percentage
ownership or security interest, to the extent of the Purchased Interest, in
the Pool Receivables, the Related Security and Collections with respect
thereto, and a first priority perfected security interest in the Pool
Assets, in each case free and clear of any Adverse Claim, in favor of the
Agent, for the benefit of the Purchasers, including taking such action to
perfect, protect or more fully evidence the interests of the Agent and
Purchasers as the Agent may reasonably request.
(e) Sales, Liens, Etc. The Seller shall not sell, assign (by
operation of law or otherwise) or otherwise dispose of, or create or suffer
to exist any Adverse Claim upon or with respect to, any or all of its
right, title or interest in, to or under any Pool Assets (including the
Seller's undivided interest in any Receivable, Related Security or
Collections, or upon or with respect to any account to which any
Collections of any Receivables are sent), or assign any right to receive
income in respect of any items contemplated by this paragraph; it being
understood that the Servicer may sell a Defaulted Receivable if the
Servicer believes in good faith that such sale will maximize the amount of
Collections with respect to such Receivable.
(f) Change in Credit and Collection Policy. The Seller shall not make
(or permit any Originator to make) any material change in the character of
its business or the Credit and Collection Policy that would materially
adversely affect the collectibility of the Receivables Pool or the
enforceability of any related Contract or the ability of the Seller or
Servicer to perform its obligations under the Agreement.
(g) Audits. (i) The Seller shall (and shall cause each Originator
to), from time to time during regular business hours as reasonably
requested in advance (unless a Termination Event or Unmatured Termination
Event exists) by the Agent or the Co-Agent, permit the Agent or the Co-
Agent, or their agents or representatives: (A) to examine and make copies
of and abstracts from all books, records and documents (including computer
tapes and disks) in the possession or under the control of the Seller (or
any Originator) relating to Receivables and the Related Security, including
the related Contracts, and (B) to visit the offices and properties of the
Seller, Xxxxxxx and each Originator for the purpose of examining such
materials described in clause (i)(A) above, and to discuss matters relating
to Receivables and the Related Security or the Seller's, Xxxxxxx'x or such
Originator's performance under the Transaction Documents or such
Originator's performance under the Contracts with any of the officers,
employees, agents or contractors of the Seller, Xxxxxxx or such Originator
having knowledge of such matters; and (ii) without limiting the provisions
of clause (i) next above, from time to time during regular business hours,
upon five Business Days prior written notice from the Agent or the
Co-Agent, permit certified public accountants or other auditors acceptable
to the Agent or the Co-Agent to conduct a review of the Seller's or any
Originator's books and records, at the Seller's or such Originator's
expense (as the case may be), with respect to the Receivables.
(h) Change in Payment Instructions to Obligors. The Seller shall not,
and shall not permit the Servicer or any Originator to make any change in
its instructions to Obligors regarding payments to be made to the Seller,
such Originator, the Servicer or the Collection Account (or related post
office box), unless the Agent shall have consented thereto in writing
(which consent shall not be unreasonably withheld).
(i) Deposits to Collection Account. The Seller shall (or shall cause
the Servicer to): (i) instruct all Obligors to make payments of all
Receivables to the Collection Account or to post office boxes to which only
the Collection Account Bank has access (and shall instruct the Collection
Account Bank to cause all items and amounts relating to such Receivables
received in such post office boxes to be removed and deposited into the
Collection Account on a daily basis), and (ii) deposit, or cause to be
deposited, any Collections received by it, the Servicer or any Originator
into the Collection Account not later than one Business Day after receipt
thereof. The Collection Account shall at all times be subject to the
Collection Account Agreement. The Seller will not (and will not permit the
Servicer to) deposit or otherwise credit, or cause or permit to be so
deposited or credited, to the Collection Account cash or cash proceeds
other than Collections.
(j) Reporting Requirements. The Seller shall provide to the Agent the
following:
(i) as soon as available and in any event within 95 days after
the end of each fiscal year of the Seller, a copy of its unaudited
balance sheet and income statement for such year certified as to
accuracy by the chief financial officer or treasurer of the Seller;
(ii) as soon as possible and in any event within five days
after the occurrence of each Termination Event or Unmatured
Termination Event, a statement of the chief financial officer of the
Seller setting forth details of such Termination Event or Unmatured
Termination Event and the action that the Seller has taken and
proposes to take with respect thereto;
(iii) promptly after the filing or receiving thereof, copies of
all reports and notices that the Seller or any Affiliate files under
ERISA with the Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or that the Seller or any
Affiliate receives from any of the foregoing or from any
multiemployer plan (within the meaning of Section 4001(a)(3) of
ERISA) to which the Seller or any of its Affiliates is or was, within
the preceding five years, a contributing employer, in each case in
respect of the assessment of withdrawal liability or an event or
condition that could, in the aggregate, result in the imposition of
liability on the Seller and/or any such Affiliate;
(iv) at least 30 days before any change in the Seller's name or
any other change requiring the amendment of UCC financing statements,
a notice setting forth such changes and the effective date thereof;
(v) promptly after the Seller obtains knowledge thereof, notice
of any: (A) material litigation, investigation or proceeding that may
exist at any time between the Seller and any Person or (B) material
litigation or proceeding relating to any Transaction Document;
(vi) promptly after the occurrence thereof, notice of a change
in the business, operations, property or financial or other condition
of the Seller, the Servicer or any Originator which would have a
Material Adverse Effect; and
(vii) such other information respecting the Receivables or the
condition or operations, financial or otherwise, of the Seller or any
of its Affiliates as the Agent or the Co-Agent may from time to time
reasonably request upon reasonable notice.
(k) Certain Agreements. Without the prior written consent of the
Agent and the Co- Agent, the Seller will not (and will not permit any
Originator to) amend, modify, waive, revoke or terminate any Transaction
Document (other than this Agreement, which shall not be amended, modified,
waived, revoked or terminated except in accordance with this Agreement) to
which it is a party or any provision of Seller's certificate of
incorporation or by-laws.
(l) Restricted Payments. (i) Except pursuant to clause (ii) below,
the Seller will not: (A) purchase or redeem any shares of its capital
stock, (B) declare or pay any dividend or set aside any funds for any such
purpose, (C) prepay, purchase or redeem any Debt, (D) lend or advance any
funds or (E) repay any loans or advances to, for or from any of its
Affiliates (the amounts described in clauses (A) through (E) being referred
to as "Restricted Payments").
(ii) Subject to the limitations set forth in clause (iii)
below, the Seller may make Restricted Payments so long as such
Restricted Payments are made only in one or more of the following
ways: (A) the Seller may make cash payments (including prepayments)
on the Subordinated Note in accordance with its terms, and (B) if no
amounts are then outstanding under the Subordinated Note, the Seller
may declare and pay dividends.
(iii) The Seller may make Restricted Payments only out of the
funds it receives pursuant to Sections 1.7(b)(ii) and (iv) of the
Agreement. Furthermore, the Seller shall not pay, make or declare:
(A) any dividend if, after giving effect thereto, the Seller's
tangible net worth would be less than $20,000,000, or (B) any
Restricted Payment (including any dividend) if, after giving effect
thereto, any Termination Event or Unmatured Termination Event shall
have occurred and be continuing.
(m) Other Business. The Seller will not: (i) engage in any business
other than the transactions contemplated by the Transaction Documents and
its Certificate of Incorporation and Bylaws; (ii) create, incur or permit
to exist any Debt of any kind (or cause or permit to be issued for its
account any letters of credit or bankers' acceptances) other than pursuant
to this Agreement or the Subordinated Notes; or (iii) form any Subsidiary
or make any investments in any other Person; provided, however, that the
Seller shall be permitted to incur minimal obligations to the extent
necessary for the day-to-day operations of the Seller (such as expenses for
stationery, audits, maintenance of legal status, etc.); provided that such
miscellaneous expenses shall not exceed an aggregate amount of $9,750 at
any one time outstanding.
(n) Use of Seller's Share of Collections. The Seller shall apply the
Seller's Share of Collections to make payments in the following order of
priority: (i) the payment of its expenses (including all obligations
payable to the Purchasers under the Agreement and under the Fee Letter);
(ii) the payment of accrued and unpaid interest on the Subordinated Notes;
and (iii) Restricted Payments and other legal and valid corporate purposes.
(o) Tangible Net Worth. The Seller will not permit its tangible net
worth, at any time, to be less than $20,000,000.
(p) Extension or Amendment of Receivables. Except as provided in
Section 4.2 of the Agreement and the Credit and Collection Policy, the
Seller shall not, and shall not permit the Servicer to, extend the maturity
or adjust the Outstanding Balance or otherwise modify the terms of any Pool
Receivable, or amend, modify or waive any term or condition of any related
Contract.
2. Covenants of the Servicer and Xxxxxxx. Until the Final Payout Date:
(a) Compliance with Laws, Etc. The Servicer and, to the extent that
it ceases to be the Servicer, Xxxxxxx shall comply in all material respects
with all applicable laws, rules, regulations and orders, and preserve and
maintain its corporate existence, rights, franchises, qualifications and
privileges, except to the extent that the failure so to comply with such
laws, rules and regulations or the failure so to preserve and maintain such
existence, rights, franchises, qualifications and privileges would not have
a Material Adverse Effect.
(b) Records and Books of Account, Etc. The Servicer shall maintain
and implement administrative and operating procedures (including an ability
to recreate records evidencing Receivables and related Contracts in the
event of the destruction of the originals thereof), and keep and maintain
all documents, books, records, computer tapes and disks and other
information reasonably necessary or advisable for the collection of all
Receivables (including records adequate to permit the daily identification
of each Receivable and all Collections of and adjustments to each existing
Receivable).
(c) Change in Credit and Collection Policy. The Servicer shall not
make any material change in the character of its business or in the Credit
and Collection Policy that would materially adversely affect the
collectibility of the Receivables Pool or the enforceability of any related
Contract or its ability to perform its obligations under the Agreement.
(d) Audits. (i) The Servicer shall from time to time during regular
business hours as reasonably requested in advance (unless a Termination
Event or Unmatured Termination Event exists) by the Agent or the Co-Agent,
permit the Agent or the Co-Agent, or their agents or representatives: (A)
to examine and make copies of and abstracts from all books, records and
documents (including computer tapes and disks) in its possession or under
its control relating to Receivables and the Related Security, including the
related Contracts, and (B) to visit its offices and properties for the
purpose of examining such materials described in clause (i)(A) above, and
to discuss matters relating to Receivables and the Related Security or its
performance hereunder or under the Contracts with any of its officers,
employees, agents or contractors having knowledge of such matters; and (ii)
without limiting the provisions of clause (i) next above, from time to time
during regular business hours, upon five Business Days prior written notice
from the Agent or the Co-Agent, permit certified public accountants or
other auditors acceptable to the Agent to conduct, at Servicer's expense, a
review of the Servicer's books and records with respect to the Receivables.
(e) Deposits to Collection Account. The Servicer shall: (i) instruct
all Obligors to make payments of all Receivables to the Collection Account
or to post office boxes to which only the Collection Account Bank has
access (and shall instruct the Collection Account Bank to cause all items
and amounts relating to such Receivables received in such post office boxes
to be removed and deposited into the Collection Account on a daily basis);
and (ii) deposit, or cause to be deposited, any Collections received by it
into the Collection Account not later than one Business Day after receipt
thereof. The Collection Account shall at all times be subject to the
Collection Account Agreement. The Servicer will not deposit or otherwise
credit, or cause or permit to be so deposited or credited, to the
Collection Account cash or cash proceeds other than Collections.
(f) Reporting Requirements. Xxxxxxx shall provide to the Agent and
the Co-Agent (with sufficient copies for the Purchasers) the following:
(i) As soon as available and in any event within 50 days after
the end of each of the first three quarters of each fiscal year of
Group and Xxxxxxx, (a) copies of (A) the unaudited consolidated
balance sheet of Group and its consolidated Subsidiaries and (B) the
unaudited balance sheet of Xxxxxxx, in each case as at the end of
such quarter, together with unaudited statements of earnings and
stockholders' equity for such quarter and the portion of the fiscal
year through such quarter, prepared in accordance with GAAP and
certified by the chief financial officer, treasurer or chief
accounting officer of Group and Xxxxxxx, as applicable, and (b) a
letter from the chief financial officer, treasurer or chief
accounting officer of Group or Xxxxxxx, as applicable, certifying to
the best knowledge of such officer, that neither a Termination Event
nor an Unmatured Termination Event has occurred and is continuing;
(ii) As soon as available and in any event within 95 days after
the end of each fiscal year of Group and Xxxxxxx, (a) a copy of (A)
the consolidated balance sheet of Group and its consolidated
Subsidiaries and (B) the unaudited balance sheet of Xxxxxxx, in each
case as at the end of such fiscal year, together with the related
statements of earnings and stockholders' equity for such fiscal year,
each prepared in accordance with GAAP applied consistently throughout
the periods reflected therein (Group's consolidated balance sheet and
such related statements to be certified without any Impermissible
Qualification by independent certified public accountants of
nationally recognized standing), and (b) a letter from the chief
financial officer, treasurer or chief accounting officer of Group or
Xxxxxxx, as applicable, certifying to the best knowledge of such
officer, that neither a Termination Event nor an Unmatured
Termination Event has occurred and is continuing, in each case as at
the end of each such fiscal year and the date of delivery of such
letter;
(iii) As to the Servicer only, as soon as available and in any
event not later than (a) the Monthly Report Date for each month, a
Monthly Report as of the last day of the most recently ended Fiscal
Month or, within ten Business Days of a request by the Agent, a
Monthly Report for such periods as is specified by the Agent and (b)
not later than the Weekly Report Date commencing on November 3, 2000
and on each Weekly Report Date thereafter, for each week, a Weekly
Report reflecting information as of the last day of the prior week;
(iv) Promptly after the sending or filing thereof, copies of
all reports that Group sends to any of its security holders, and
copies of all reports and registration statements that Group or any
Subsidiary files with the Securities and Exchange Commission or any
national securities exchange;
(v) Promptly after the filing or receiving thereof, copies of
all reports and notices that Group or any of its Affiliate files
under ERISA with the Internal Revenue Service, the Pension Benefit
Guaranty Corporation or the U.S. Department of Labor or that such
Person or any of its Affiliates receives from any of the foregoing or
from any multiemployer plan (within the meaning of Section 4001(a)(3)
of ERISA) to which such Person or any of its Affiliate is or was,
within the preceding five years, a contributing employer, in each
case in respect of the assessment of withdrawal liability or an event
or condition that could, in the aggregate, result in the imposition
of liability on Group and/or any such Affiliate;
(vi) Promptly after Xxxxxxx obtains knowledge thereof, notice
of any: (A) litigation, investigation or proceeding that may exist at
any time between Xxxxxxx or any of its Affiliates and any
Governmental Authority that, if not cured or if adversely determined,
as the case may be, would have a Material Adverse Effect; (B)
litigation or proceeding adversely affecting such Person or any of
its Subsidiaries which would have a Material Adverse Effect; or (C)
litigation or proceeding relating to any Transaction Document;
(vii) As soon as available, a revised list of Fiscal Months as
may be necessary to update Schedule III from time to time;
(viii)Such other information respecting the Receivables or the
condition or operations, financial or otherwise, of Xxxxxxx or any of
its Affiliates as the Agent may from time to time reasonably request.
3. Separate Existence. Each of the Seller and Xxxxxxx hereby
acknowledges that the Purchasers and the Agent and the Co-Agent are
entering into the transactions contemplated by this Agreement and the other
Transaction Documents in reliance upon the Seller's identity as a legal
entity separate from Xxxxxxx and its Affiliates. Therefore, from and after
the date hereof, each of the Seller and Xxxxxxx shall take all steps
specifically required by the Agreement or reasonably required by the Agent
to continue the Seller's identity as a separate legal entity and to make it
apparent to third Persons that the Seller is an entity with assets and
liabilities distinct from those of Xxxxxxx and any other Person, and is not
a division of Xxxxxxx, its Affiliates or any other Person. Without limiting
the generality of the foregoing and in addition to and consistent with the
other covenants set forth herein, each of the Seller and Xxxxxxx shall take
such actions as shall be required in order that:
(a) The Seller will be a limited purpose corporation whose
primary activities are restricted in its certificate of incorporation
to: (i) purchasing or otherwise acquiring from the Originators,
owning, holding, granting security interests or selling interests in,
Pool Assets, (ii) entering into agreements for the selling and
servicing of the Receivables Pool, and (iii) conducting such other
activities as it deems necessary or appropriate to carry out its
primary activities;
(b) The Seller shall not engage in any business or activity, or
incur any indebtedness or liability, other than as expressly
permitted by the Transaction Documents;
(c) Not less than one member of the Seller's Board of Directors
(the "Independent Director") shall be an individual who is not and
has not been at any time during the preceding five years a direct,
indirect or beneficial stockholder, officer, director, employee,
creditor, affiliate, associate or supplier of Xxxxxxx or any of its
Affiliates. The certificate of incorporation of the Seller shall
provide that: (i) the Seller's Board of Directors shall not approve,
or take any other action to cause the filing of, a voluntary
bankruptcy petition with respect to the Seller unless the Independent
Director shall approve the taking of such action in writing before
the taking of such action, and (ii) such provision cannot be amended
without the prior written consent of the Independent Director;
(d) The Independent Director shall not at any time serve as a
trustee in bankruptcy for the Seller, Xxxxxxx or any Affiliate
thereof;
(e) Any employee, consultant or agent of the Seller will be
compensated from the Seller's funds for services provided to the
Seller. The Seller will not engage any agents other than its
attorneys, auditors and other professionals, and a servicer and any
other agent contemplated by the Transaction Documents for the
Receivables Pool, which servicer will be fully compensated for its
services by payment of the Servicing Fee, and a manager, which
manager will be fully compensated from the Seller's funds;
(f) The Seller will contract with the Servicer to perform for
the Seller all operations required on a daily basis to service the
Receivables Pool. The Seller will pay the Servicer the Servicing Fee
pursuant to the Agreement. The Seller will not incur any material
indirect or overhead expenses for items shared with Xxxxxxx (or any
other Affiliate of Group) that are not reflected in the Servicing
Fee. To the extent, if any, that the Seller (or any Affiliate
thereof) shares items of expenses not reflected in the Servicing Fee
or the manager's fee, such as legal, auditing and other professional
services, such expenses will be allocated to the extent practical on
the basis of actual use or the value of services rendered, and
otherwise on a basis reasonably related to the actual use or the
value of services rendered; it being understood that Group shall pay
all expenses relating to the preparation, negotiation, execution and
delivery of the Transaction Documents, including legal, agency and
other fees;
(g) The Seller's operating expenses will not be paid by Xxxxxxx
or any other Affiliate thereof;
(h) All of the Seller's business correspondence and other
communications shall be conducted in the Seller's own name and on its
own separate stationery;
(i) The Seller's books and records will be maintained
separately from those of Xxxxxxx and any other Affiliate thereof;
(j) All financial statements of Xxxxxxx or any Affiliate
thereof that are consolidated to include Seller will contain detailed
notes clearly stating that: (i) a special purpose corporation exists
as a Subsidiary of Warnaco, and (ii) Xxxxxxx has sold receivables
and other related assets to such special purpose Subsidiary that, in
turn, has sold undivided interests therein to certain financial
institutions and other entities;
(k) The Seller's assets will be maintained in a manner that
facilitates their identification and segregation from those of
Xxxxxxx or any Affiliate thereof;
(l) The Seller will strictly observe corporate formalities in
its dealings with Xxxxxxx or any Affiliate thereof, and funds or
other assets of the Seller will not be commingled with those of
Xxxxxxx or any Affiliate thereof. The Seller shall not maintain joint
bank accounts or other depository accounts to which Xxxxxxx or any
Affiliate thereof (other than Xxxxxxx in its capacity as the
Servicer) has independent access. The Seller will not guarantee the
obligations of any Person, and no Person will guarantee the
obligations of the Seller. The Seller will pay to the appropriate
Affiliate the marginal increase or, in the absence of such increase,
the market amount of its portion of the premium payable with respect
to any insurance policy that covers the Seller and such Affiliate;
and
(m) The Seller will maintain arm's-length relationships with
Xxxxxxx (and any Affiliate thereof). Any Person that renders or
otherwise furnishes services to the Seller will be compensated by the
Seller at market rates for such services it renders or otherwise
furnishes to the Seller. Neither the Seller nor Xxxxxxx will be or
will hold itself out to be responsible for the debts of the other or
the decisions or actions respecting the daily business and affairs of
the other. The Seller and Xxxxxxx will immediately correct any known
misrepresentation with respect to the foregoing, and they will not
operate or purport to operate as an integrated single economic unit
with respect to each other or in their dealing with any other entity.
(n) Xxxxxxx shall not pay the salaries of Seller's employees,
if any.
EXHIBIT V
TERMINATION EVENTS
Each of the following shall be a "Termination Event":
(a) (i) the Seller shall fail to make the payment or deposit required
to be made pursuant to Section 1.7(g), (ii) the Seller, Xxxxxxx, any
Originator or the Servicer shall fail to make when due any other payment or
deposit to be made by it under the Agreement or any other Transaction
Document within three Business Days of the date on which such other payment
or deposit is due, or (iii) the Seller, Xxxxxxx, any Originator or the
Servicer (if Xxxxxxx or any Affiliate of Group) shall fail to perform or
observe in any material respect any other term, covenant or agreement under
the Agreement or any other Transaction Document and such failure shall
continue for 10 Business Days after the Seller, such Originator or the
Servicer shall have obtained actual knowledge or notice thereof;
(b) Xxxxxxx (or any Affiliate of Group) shall fail to transfer to any
successor Servicer when required any rights pursuant to the Agreement that
Xxxxxxx (or such Affiliate) then has as Servicer;
(c) any representation or warranty made or deemed made by the Seller,
any Originator or Xxxxxxx (or any of their respective officers) under or in
connection with the Agreement or any other Transaction Document, or any
information or report (including any Monthly Report and Weekly Report)
delivered by the Seller or any Originator or the Servicer pursuant to the
Agreement or any other Transaction Document, shall prove to have been
incorrect or untrue in any material respect when made or deemed made or
delivered which in the sole judgment of the Agent and the Co-Agent, acting
together, has had or is reasonably likely to have a Material Adverse
Effect;
(d) the Servicer shall fail to deliver any Monthly Report on the
related Monthly Report Date, and such failure shall remain unremedied for
five Business Days, or the Servicer shall fail to deliver any Weekly Report
on the related Weekly Report Date.
(e) the Agreement or any purchase or reinvestment pursuant to the
Agreement shall for any reason: (i) cease to create, or the Purchased
Interest shall for any reason cease to be, a valid and enforceable
perfected undivided percentage ownership or security interest to the extent
of such Purchased Interest in each Pool Receivable, the Related Security
and Collections with respect thereto, free and clear of any Adverse Claim,
or (ii) cease to create with respect to the Pool Assets, or the interests
of the Purchasers with respect to such Pool Assets shall cease to be, a
valid and enforceable first priority perfected security interest, free and
clear of any Adverse Claim,
(f) the Seller, Xxxxxxx or any Originator shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to
pay its debts generally, or shall make a general assignment for the benefit
of creditors; or any proceeding shall be instituted by or against the
Seller, Xxxxxxx or any Originator seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any
law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of
a receiver, trustee, custodian or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding
shall remain undismissed or unstayed for a period of 60 days, or any of the
actions sought in such proceeding (including the entry of an order for
relief against, or the appointment of a receiver, trustee, custodian or
other similar official for, it or for any substantial part of its property)
shall occur; or the Seller, Xxxxxxx or any Originator shall take any
corporate action to authorize any of the actions set forth above in this
paragraph;
(g) (i) the average of the Default Ratios for any three consecutive
Fiscal Months shall exceed 9.0% or (ii) the average of the Dilution Ratios
for any three consecutive Fiscal Months shall exceed 35.0%, (iii) the
average of the Loss-to-Liquidation Ratios for any three consecutive Fiscal
Months shall exceed 11.0% or (iv) the greatest average of the Delinquency
Ratios for any three consecutive Fiscal Months during the twelve most
recent Fiscal Months shall exceed 9.0%;
(h) a Change in Control shall occur;
(i) at any time, the sum of (a) the Aggregate Capital and Total
Reserves under this Agreement exceeds the sum of (x) the Net Receivables
Pool Balance and (y) the aggregate Purchasers' Share of Collections then on
deposit in the Collection Account (other than amounts set aside therein in
respect of Discount, Fees and Servicing Fee), and such condition shall
continue unremedied for one Business Day;
(j) any Loan Party or any of its Subsidiaries shall fail to pay any
principal of or premium or interest on or any other amount payable in
respect of any Debt that is outstanding in a principal or reimbursement
amount (or, in the case of any Hedge Agreement, its Agreement Value) of (i)
with respect to any Covered Facility, at least $5,000,000 or (ii) with
respect to any other Debt, at least $20,000,000 in the aggregate; in any
case either individually or in the aggregate of such Loan Party or such
Subsidiary (as the case may be), when the same becomes due and payable
whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise, and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to such
Debt; or any other event shall occur or condition shall exist under any
agreement or instrument relating to any such Debt as specified in clause
(ii) and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or to permit the acceleration of, the maturity
of such Debt as specified in clause (ii) or otherwise to cause, or to
permit the holder thereof to cause, such Debt as specified in clause (ii)
to mature; or any such Debt as specified in clause (ii) shall be declared
to be due and payable or is then required to be prepaid or redeemed (other
than by a regularly scheduled required prepayment or redemption), purchased
or defeased, or an offer to prepay, redeem, purchase or defease such Debt
as specified in clause (ii) shall be then required to be made, in each case
prior to the stated maturity thereof; or
(k) either: (i) a contribution failure shall occur with respect to
any Benefit Plan sufficient to give rise to a lien under Section 302(f) of
ERISA, (ii) the Internal Revenue Service shall file a notice of lien
asserting a claim pursuant to the Internal Revenue Code with regard to any
of the assets of Seller or Xxxxxxx or any ERISA Affiliate, or (iii) the
Pension Benefit Guaranty Corporation shall file a notice of lien asserting
a claim pursuant to ERISA with regard to any assets of Seller, Xxxxxxx or
any ERISA Affiliate.
