Exhibit 10.6
TERTIARY PURCHASE AGREEMENT
Dated as of September 21, 2004
Among
RITE AID FUNDING I,
as Seller,
RITE AID FUNDING II,
as Purchaser, and
RITE AID HDQTRS. FUNDING, INC.,
as Collection Agent
TABLE OF CONTENTS
Page
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PRELIMINARY STATEMENTS......................................................................................1
ARTICLE I DEFINITIONS.....................................................................................1
SECTION 1.01. Certain Defined Terms...................................................................1
SECTION 1.02. Other Terms............................................................................14
ARTICLE II AMOUNTS AND TERMS OF PURCHASES.................................................................14
SECTION 2.01. Facility...............................................................................14
SECTION 2.02. Making Purchases.......................................................................14
SECTION 2.03. Collections............................................................................16
SECTION 2.04. Settlement Procedures..................................................................16
SECTION 2.05. Payments and Computations, Etc.........................................................16
ARTICLE III CONDITIONS OF PURCHASES........................................................................17
SECTION 3.01. Conditions Precedent to Initial Purchase from the Seller...........................17
SECTION 3.02. Conditions Precedent to All Purchases..............................................18
ARTICLE IV REPRESENTATIONS AND WARRANTIES.................................................................19
SECTION 4.01. Representations and Warranties of the Seller.......................................19
ARTICLE V COVENANTS .....................................................................................22
SECTION 5.01. Covenants of the Seller............................................................22
SECTION 5.02. Grant of Security Interest.........................................................27
ARTICLE VI ADMINISTRATION AND COLLECTION..................................................................28
SECTION 6.01. Designation of Collection Agent....................................................28
SECTION 6.02. Duties of Collection Agent.........................................................28
SECTION 6.03. Collection Agent Fee...............................................................29
SECTION 6.04. Certain Rights of the Purchaser....................................................29
SECTION 6.05. Rights and Remedies. ..............................................................30
SECTION 6.06. Transfer of Records to Purchaser...................................................31
ARTICLE VII EVENTS OF TERMINATION......................................................................31
SECTION 7.01. Events of Termination..............................................................31
ARTICLE VIII INDEMNIFICATION............................................................................34
SECTION 8.01. Indemnities by the Seller..........................................................34
ARTICLE IX MISCELLANEOUS..................................................................................36
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SECTION 9.01. Amendments, Etc....................................................................36
SECTION 9.02. Notices, Etc.......................................................................36
SECTION 9.03. Binding Effect; Assignability......................................................36
SECTION 9.04. Costs, Expenses and Taxes..........................................................37
SECTION 9.05. No Proceedings.....................................................................37
SECTION 9.06. Confidentiality....................................................................37
SECTION 9.07. GOVERNING LAW......................................................................38
SECTION 9.08. Third Party Beneficiary............................................................38
SECTION 9.09. Execution in Counterparts..........................................................38
SECTION 9.10. Consent to Jurisdiction............................................................38
SECTION 9.11. WAIVER OF JURY TRIAL...............................................................39
SECTION 9.12. Judgment...........................................................................39
SCHEDULE 1 Intentionally Omitted
SCHEDULE 2 MONTHS
EXHIBIT A CREDIT AND COLLECTION POLICY
EXHIBIT B DEPOSIT BANKS, LOCK BOXES AND DEPOSIT ACCOUNTS;
ACCOUNT BANKS AND GOVERNMENTAL ENTITY
RECEIVABLES ACCOUNTS
EXHIBIT C Intentionally Omitted
EXHIBIT D ADDRESSES
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TERTIARY PURCHASE AGREEMENT
Dated as of September 21, 2004
Rite Aid Funding I, a Cayman Islands exempted company
incorporated with limited liability on August 11, 2004 under the name Cayman
Resources (21) Ltd. (registration number 138720) (the "Seller"), Rite Aid
Funding II, a Cayman Islands exempted company incorporated with limited
liability on August 11, 2004 under the name Cayman Resources (22) Ltd.
(registration number 138722) (the "Purchaser") and Rite Aid Hdqtrs. Funding,
Inc., a Delaware corporation (the "Collection Agent"), agree as follows:
PRELIMINARY STATEMENTS.
(1) Certain terms which are capitalized and used throughout
this Agreement (in addition to those defined above) are defined in Article I of
this Agreement.
(2) The Seller has Receivables (or interests therein) that
it wishes to sell to the Purchaser, and the Purchaser is prepared to purchase
such Receivables (or interests therein) on the terms set forth in this Tertiary
Purchase Agreement (this "Agreement").
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"Account Bank" has the meaning given to such term in the
definition of Governmental Entity Receivables Agreement.
"Adverse Claim" means a lien, security interest, or other
charge or encumbrance, or any other type of preferential arrangement.
"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 or is a director or officer of such
Person.
"Alternate Base Rate" means 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 highest of:
(a) the rate of interest announced publicly by
Citibank, N.A. in New York, New York, from time to time as
Citibank, N.A.'s base rate; and
(b) 1/2 of one percent above the Federal Funds
Rate.
"Business Day" means any day on which banks are not authorized
or required to close in New York City.
"Capital Lease" means any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination
thereof, which, in accordance with GAAP, should be capitalized on the
lessee's balance sheet.
"Capital Lease Obligation" of any Person means the obligations
of such Person to pay rent or other amounts under any Capital Lease,
which obligations should be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in
accordance with GAAP.
"CHAMPUS" means the Civilian Health and Medical Program of the
Uniformed Service, a program of medical benefits covering former and
active members of the uniformed services and certain of their
dependents, financed and administered by the United States Departments
of Defense, Health and Human Services and Transportation and
established pursuant to 10 U.S.C. xx.xx. 1071-1106, and all regulations
promulgated thereunder including without limitation (a) all federal
statutes (whether set forth in 10 U.S.C. xx.xx. 1071-1106 or elsewhere)
affecting CHAMPUS and (b) all rules, regulations (including 32 CFR
199), manuals, orders and administrative, reimbursement and other
guidelines of all Governmental Entities (including, without limitation,
the Department of Health and Human Services, the Department of Defense,
the Department of Transportation, the Assistant Secretary of Defense
(Health Affairs) and the Office of CHAMPUS, or any Person or entity
succeeding to the functions of any of the foregoing) promulgated
pursuant to or in connection with any of the foregoing (whether or not
having the force of law) in each case, as amended, supplemented or
otherwise modified from time to time.
"CMS" means Centers for Medicare & Medicaid Services of the
Department of Health and Human Services, and any successor agency.
"Collection Agent" means at any time the Person then
authorized pursuant to Section 6.01 to service, administer and collect
Purchased Assets.
"Collection Agent Fee" has the meaning specified in Section
6.03.
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"Collections" means, (a) with respect to any Receivable, all
cash collections and other cash proceeds of such Receivable, including,
without limitation, all cash proceeds of Related Security with respect
to such Receivable, and all funds deemed to have been received by the
applicable Originator, the Collection Agent, the Seller or any other
Person as a Collection pursuant to Section 2.04, and (b) with respect
to any Participation Interest, all cash collections and other cash
proceeds of the Government Receivable underlying such Participation
Interest, including, without limitation, all cash proceeds of Related
Security with respect to such Participation Interest, and all funds
deemed to have been received by the applicable Originator, the Seller,
the Collection Agent or any other Person as a Collection pursuant to
Section 2.04.
"Contract" means an agreement between an Originator and a
Person, or between a PBM and a Contract Payor, pursuant to or under
which such Person or Contract Payor shall be obligated to pay for
pharmaceutical merchandise sold by such Originator or its Affiliates
from time to time.
"Contract Payor" means a Person who is required under its
agreement with a PBM to make payments to such PBM who, in turn, pays
such amounts to an Originator on such Person's behalf.
"Credit and Collection Policy" means those receivables credit
and collection policies and practices of the Seller, the Collection
Agent and the Originators in effect on the date of this Agreement
applicable to the Receivables and described in Exhibit A hereto, as
modified in compliance with this Agreement.
"Debt" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to
deposits or advances of any kind, (b) all obligations of such Person
evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person under conditional sale or other title
retention agreements relating to property acquired by such Person, (d)
all obligations of such Person in respect of the deferred purchase
price of property or services (excluding current accounts payable
incurred in the ordinary course of business), (e) all Debt of others
secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) any Adverse Claim on
property owned or acquired by such Person, whether or not the Debt
secured thereby has been assumed, (f) all Guarantees by such Person of
Debt of others, (g) all Capital Lease Obligations of such Person, (h)
all obligations, contingent or otherwise, of such Person as an account
party in respect of letters of credit and letters of guaranty and (i)
all obligations, contingent or otherwise, of such Person in respect of
bankers' acceptances. The Debt of any Person shall include the Debt of
any other entity (including any partnership in which such Person is a
general partner) to the extent such Person is liable therefor as a
result of such Person's ownership interest in or other relationship
with such entity, except to the extent of the terms of such Debt
provide that such Person is not liable therefor.
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"Defaulted Participation Interest" means a Participation
Interest in a Government Receivable which is a Defaulted Receivable.
"Defaulted Receivable" means a Receivable:
(i) as to which any payment, or part thereof,
remains unpaid for [120] or more days from the original date
of service relating to such Receivable;
(ii) as to which the Obligor thereof or any other
Person obligated thereon or owning any Related Security in
respect thereof has taken any action, or suffered any event to
occur, of the type described in Section 7.01(g);
(iii) which, consistent with the Credit and
Collection Policy, would be written off as uncollectible; or
(iv) as to which the applicable Originator, the
Collection Agent or the Seller has (or consistent with the
Credit and Collection Policy should have) established a
specific reserve for non-payment.
"Deposit Account" means an account maintained at a Deposit
Bank into which (i) Collections in the form of checks and other items
are deposited that have been sent to one or more related Lock Boxes by
Obligors (other than the Contract Payors paying a PBM) and/or (ii)
Collections in the form of electronic funds transfers and other items
are paid directly by Obligors (other than the Contract Payors paying a
PBM) and (iii) which is subject to a Deposit Account Agreement.
"Deposit Account Agreement" means an agreement among an
Originator, HQ (or its assignees or designees) and any Deposit Bank in
form and substance satisfactory to the Purchaser (or its assignees or
designees).
"Deposit Bank" means any of the banks holding one or more
Deposit Accounts.
"Designated Obligor" means, at any time, each Obligor;
provided, however, that any Obligor shall cease to be a Designated
Obligor upon three Business Days' notice by the Purchaser (or its
assignees or designees) to the applicable Seller.
"Determination Date" means the seventh Business Day after the
end of each Month, provided that if an Event of Termination has
occurred and is continuing, the Seller or the Purchaser may designate
more frequent Determination Dates.
"Diluted Participation Interest" means a Participation
Interest in a Government Receivable which is a Diluted Receivable.
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"Diluted Receivable" means that portion (and only that
portion) of any Receivable which is either (a) reduced or canceled as a
result of (i) any defective, rejected or returned merchandise or
services or any failure by an Originator to deliver any merchandise or
provide any services or otherwise to perform under the underlying
Contract, (ii) any change in the terms of or cancellation of, a
Contract or any cash discount, discount for quick payment or other
adjustment by an Originator which reduces the amount payable by the
Obligor on the related Receivable (except any such change or
cancellation resulting from or relating to the financial inability to
pay or insolvency of the Obligor of such Receivable) or (iii) any
set-off by an Obligor in respect of any claim by such Obligor as to
amounts owed by it on the related Receivable (whether such claim arises
out of the same or a related transaction or an unrelated transaction)
or (b) subject to any specific dispute, offset, counterclaim or defense
whatsoever (except the discharge in bankruptcy of the Obligor thereof);
provided that Diluted Receivables are calculated assuming that all
chargebacks are resolved in the Obligor's favor.
"Discount" means, in respect of each Purchase, 2.00% of the
Outstanding Balance of the Receivables that are the subject of such
Purchase; provided, however, the foregoing Discount may be revised
prospectively by request of the Seller or the Purchaser to reflect
changes in recent experience with respect to write-offs, timing and
cost of Collections and cost of funds, provided that such revision is
consented to by the Seller and the Purchaser (it being understood that
each party agrees to duly consider such request but shall have no
obligation to give such consent).
"Eligible Receivable" means a Receivable:
(i) the Obligor of which is a United States
resident, is not an Affiliate of the Parent, and is not a
Governmental Entity, except to the extent payment of such
Receivable is governed under the Social Security Act (42
U.S.C. ss. 1395, et seq.), including payments under Medicaid
and CHAMPUS or regulated by CMS;
(ii) the Obligor of which, at the time of the
transfer of such Receivable under this Agreement, is a
Designated Obligor;
(iii) which, at the time of the transfer thereof to
the Purchaser under this Agreement, is not a Defaulted
Receivable;
(iv) the Obligor of which, at the time of the
transfer of such Receivable under this Agreement, is not the
Obligor of any Defaulted Receivables which in the aggregate
constitute 50% or more of the aggregate Outstanding Balance of
all Receivables of such Obligor;
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(v) which has been billed and, according to the
Contract related thereto, is required to be paid in full
within 60 days of the original billing date therefor;
(vi) which is an obligation representing 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, as amended, and the nature
of which is such that its purchase with the proceeds of
notes would constitute a "current transaction" within the
meaning of Section 3(a)(3) of the Securities Act of 1933, as
amended;
(vii) which is an "account" or a "payment
intangible" within the meaning of Article 9 of the UCC of
the applicable jurisdictions;
(viii) which is denominated and payable only in
United States dollars in the United States;
(ix) which arises under a Contract which, together
with such Receivable, is in full force and effect and
constitutes the legal, valid and binding obligation of the
Obligor of such Receivable and is not subject to any Adverse
Claim or any dispute, offset, counterclaim or defense
whatsoever (except the potential discharge in bankruptcy of
such Obligor and except with respect to adjudication fees
charged by any relevant PBM) and is not settled on a net
basis;
(x) which, together with the Contract related
thereto, does not contravene in any material respect any laws,
rules or regulations applicable thereto (including, without
limitation, laws, rules and regulations relating to usury,
consumer protection, truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy) and with respect to which no
party to the Contract related thereto is in violation of any
such law, rule or regulation in any material respect;
(xi) which arises under a Contract (other than a
Contract with respect to which the related Obligor is a
Governmental Entity) which (A) does not contain an enforceable
provision requiring the Obligor under such Contract to consent
to the transfer, sale or assignment of the Obligor's payment
obligation by the applicable Originator, and (B) if such
Contract is between a PBM and a Contract Payor, does not
contain any enforceable provision prohibiting the transfer,
sale or assignment of such Contract Payor's payment obligation
to the applicable Originator;
(xii) which was generated in the ordinary course of
the applicable Originator's business;
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(xiii) which, at the time of the transfer of such
Receivable under this Agreement, has not been extended,
rewritten or otherwise modified from the original terms
thereof;
(xiv) the transfer, sale or assignment of which in
accordance with the Transaction Documents does not contravene
any applicable law, rule or regulation;
(xv) which (A) satisfies all applicable
requirements of the Credit and Collection Policy and (B)
complies with such other criteria and requirements (other
than those relating to the collectibility of such
Receivable) as the Purchaser or its assignees may from time
to time reasonably specify to the Seller upon 30 days'
notice;
(xvi) as to which, at or prior to the later of the
date of this Agreement and the date such Receivable is
created, the Purchaser or its assignees has not notified the
Seller that such Receivable (or class of Receivables) is no
longer reasonably acceptable for purchase hereunder;
(xvii) as to which the applicable Originator has
satisfied and fully performed all obligations required to be
fulfilled by it;
(xviii) as to which the applicable Originator has, or
has the right to use, valid provider identification numbers
and licenses to generate valid Receivables and all information
set forth in the xxxx and supporting claim documents with
respect to such Receivable is true, complete and correct;
(xix) as to which the applicable Originator has, or
has the right to use, valid provider identification numbers
and licenses to generate valid reports with respect to such
Receivable, and all cost reports required by the applicable
state agency or other CMS-designated agents or agents of such
state agency;
(xx) which does not arise from a sale by the
applicable Originator from a store located in Hawaii,
Illinois, Minnesota, Montana or New Mexico, unless the
applicable Originator shall have furnished the Seller and its
assignees with an opinion of local counsel, or other evidence
satisfactory to the Seller and its assignees, to the effect
that the transfer, sale and assignment of Receivables and
Participation Interests in accordance with this Agreement from
a store located in such state does not violate any provision
of the law of such state; and
(xxi) which is not a Medicare Receivable.
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"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"Event of Termination" has the meaning specified in
Section 7.01.
"Facility Termination Date" means the earliest of (i) the
"Facility Termination Date" (as such term is defined in the Financing
Agreement), (ii) the date determined pursuant to Section 7.01 and (iii)
the date which the Seller designates by at least two Business Days
prior notice to the Purchaser and its assignees (including the Program
Agent under the Financing Agreement).
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the
weighted average (rounded upwards, if necessary, to the next 1/100 of
1%) of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the
next preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business
Day, the average (rounded upwards, if necessary, to the next 1/100 of
1%) of the quotations for such day on such transactions received by
Citibank, N.A. from three Federal funds brokers of recognized standing
selected by it.
"Financial Officer" means the chief financial officer,
principal accounting officer, treasurer, vice president of financial
accounting or controller of the relevant Person.
"Financing Agreement" means that certain Receivables Financing
Agreement, dated as of the date hereof, among the Purchaser, as
borrower, CAFCO, LLC, Jupiter Securitization Corporation and Blue Ridge
Asset Funding Corporation, each as an investor, Citibank, N.A., Bank
One, NA and Wachovia Bank, National Association, each as a bank,
Citicorp North America, Inc., as program agent, Citicorp North America,
Inc., Bank One, NA and Wachovia Bank, National Association, each as an
investor agent, the other investors, banks and investor agents party
thereto from time to time, Rite Aid Hdqtrs. Funding, Inc., as the
collection agent, the parties thereto named as Originators, and
JPMorgan Chase Bank as trustee, as amended or restated from time to
time.
"GAAP" means generally accepted accounting principles in the
United States.
"General Trial Balance" for the Seller on any date means the
Seller's (or the Collection Agent's) accounts receivable trial balance
(whether in the form of a computer printout, magnetic tape or diskette)
on such date, listing Obligors (other than Contract Payors) and the
Receivables respectively owed by such Obligors on such date together
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with the aged Outstanding Balances of such Receivables, in form and
substance satisfactory to the Purchaser.
"Government Receivable" means any Receivable with respect to
which the Obligor is a Governmental Entity.
"Governmental Entity" means the United States of America, any
state, any political subdivision of a state and any agency or
instrumentality of the United States of America or any state or
political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government. Payments from Governmental Entities shall be
deemed to include payments governed under the Social Security Act (42
U.S.C. ss. 1395, et seq.), including payments under Medicare, Medicaid
and CHAMPUS, and payments administered or regulated by CMS.
"Governmental Entity Receivables Account Notice" means a
notice contained in a Governmental Entity Receivables Agreement
pursuant to which an Affiliate of the Parent gives revocable standing
instructions to the Account Bank to sweep funds on a daily basis from
the Governmental Entity Receivables Account to another designated
account approved by the Purchaser and its assigns.
"Governmental Entity Receivables Account" has the meaning
given to such term in the definition of Governmental Entity Receivables
Agreement.
"Governmental Entity Receivables Agreement" means an agreement
between a bank (an "Account Bank") and one or more Originators or
Affiliates of the Parent with respect to one or more accounts (each, a
"Governmental Entity Receivables Account") or associated Lock-Boxes
into which Collections on account of Receivables of Governmental
Entities are deposited or remitted and which is subject to a
Governmental Entity Receivables Account Notice.
"Guarantee" of or by any Person (the "guarantor") means any
obligation, contingent or otherwise, of the guarantor guaranteeing or
having the economic effect of guaranteeing any Debt or other obligation
of any Person (the "primary obligor") in any manner, whether directly
or indirectly, and including any obligation of the guarantor, direct or
indirect, (a) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation or to purchase
(or to advance or supply funds for the purchase of) any security for
the payment thereof, (b) to purchase or lease property, securities or
services for the purpose of assuring the owner of such Debt or other
obligation of the payment thereof, (c) to maintain working capital,
equity capital or any other financial statement condition or liquidity
of the primary obligor so as to enable the primary obligor to pay such
Debt or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Debt or
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obligation; provided, that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of
business.
"HQ" means Rite Aid Hdqtrs. Funding, Inc., a Delaware
corporation.
"Incipient Event of Termination" means an event that but for
notice or lapse of time or both would constitute an Event of
Termination.
"Indemnified Amounts" has the meaning specified in
Section 8.01.
"Intercreditor Agreement" means that certain Intercreditor
Agreement dated as of September 22, 2004 among Citicorp North America,
Inc. (as program agent under the Financing Agreement), the Borrower,
the Originators, the Seller, and Citicorp North America, Inc. and
JPMorgan Chase Bank, as collateral agents, as the same may be amended,
modified or restated from time to time.
"Lock-Box" means a post office box either (a) administered by
a Deposit Bank for the purpose of receiving Collections, which is the
subject of a Deposit Account Agreement, or (b) which receives
Collections of Government Receivables and is associated with a
Government Entity Receivables Account that is subject to a Governmental
Entity Receivables Agreement.
"Material Adverse Effect" means a material adverse effect on
(i) the collectibility of the Receivables, (ii) the ability of the
Purchaser, the Seller, the Collection Agent or any Originator to
perform any of its respective material obligations under the
Transaction Documents to which it is a party, (iii) the legality,
validity or enforceability of the Transaction Documents (including,
without limitation, the validity, enforceability or priority of the
ownership interests and security interests granted hereunder) or the
rights of or benefits available to the Purchaser under the Transaction
Documents, or (iv) the business, assets, operations, condition
(financial or otherwise), or prospects of the Parent and its
subsidiaries, taken as a whole.
"Medicaid" means the medical assistance program established by
Title XIX of the Social Security Act (42 U.S.C. Secs. 1396 et seq.)
and any statutes succeeding thereto.
"Medicare" means the health insurance program for the aged and
disabled established by Title XVIII of the Social Security Act (42
U.S.C. Secs. 1395 et seq.) and any statutes succeeding thereto.
"Month" means a fiscal month of the Parent as set forth on
Schedule 2 hereto, as such schedule shall be updated from time to time
in accordance with the terms hereof.
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"Obligor" means a Person obligated to make payments to an
Originator pursuant to a Contract; provided, however, if a PBM acts as
agent for Contract Payors and is obligated, pursuant to a Contract, to
turn over to an Originator payments made to it by such Contract Payors,
then the term "Obligor" shall include both such PBM and such Contract
Payors.
"Originator" means each of the Persons designated as such on
Schedule I to the Originator Purchase Agreement.
"Originator Purchase Agreement" means the Purchase Agreement
dated as of the date of this Agreement among the Originators, as
sellers and HQ, as purchaser and collection agent, as amended or
restated from time to time.
"Outstanding Balance" means at any time (i) with respect to
any Receivable, the then outstanding principal balance thereof and (ii)
with respect to any Participation Interest, the then outstanding
principal balance of the underlying Government Receivable. Any sales or
use tax billed in connection with a Receivable is not included in the
Outstanding Balance.
"Parent" means Rite Aid Corporation, a Delaware corporation.
"Parent Undertaking (Originators)" means the Undertaking
Agreement dated as of September 21, 2004 made by the Parent in favor of
HQ relating to obligations of the Originators, as amended, modified or
restated from time to time.
"Participated Receivable" means any Receivable which is the
subject of a Purchased Participation Interest.
"Participation Interest" means, with respect to any
Originator, a 100% undivided beneficial interest in such Originator's
right, title and interest, whether now owned or hereafter arising and
wherever located, in, to and under (i) each Government Receivable owned
by such Originator, (ii) all Related Security and Collections with
respect to such Government Receivable and (iii) all proceeds of such
Government Receivable, Related Security, and Collections.
"PBM" means a pharmaceutical benefits manager which has
entered into an agreement with an Originator to make payments as agent
for various insurers and other Persons, on account of pharmaceutical
goods sold by such Originator.
"Person" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock
company, trust, unincorporated association, joint venture or other
entity, or a Governmental Entity.
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"Purchase" means a purchase by the Purchaser of Receivables
and/or Participation Interests from the Seller pursuant to Article II
(including a purchase paid for in whole or in part by a capital
contribution).
"Purchase Date" means each day on which a Purchase is made
pursuant to Article II.
"Purchase Price" for any Purchase means an amount equal to the
Outstanding Balance of the Receivables that are the subject of such
Purchase as set forth in the Seller's General Trial Balance, minus the
Discount for such Purchase.
"Purchased Asset" means any Purchased Receivable or Purchased
Participation Interest.
"Purchased Participation Interest" means any Participation
Interest which is purchased or purported to be purchased by the
Purchaser pursuant to Article II (including a Participation Interest
which is contributed by the Seller to the Purchaser).
"Purchased Receivable" means any Receivable (other than a
Government Receivable) which is purchased or purported to be purchased
by the Purchaser pursuant to Article II (including a Receivable (other
than a Government Receivable) which is contributed by the Seller to the
Purchaser).
"Receivable" means the indebtedness or obligation of any
Obligor resulting from the provision or sale of pharmaceutical
merchandise by an Originator (or an Affiliate on behalf of such
Originator) under a Contract (whether constituting an account,
instrument, chattel paper, payment intangible or general intangible),
and includes the right to payment of any interest or finance charges
and other obligations of such Obligor with respect thereto.
"Related Security" means (a) with respect to any Receivable:
(i) all of the applicable Originator's interest in
merchandise, if any, (including returned merchandise) relating
to any sale giving rise to such Receivable;
(ii) all 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 financing
statements filed against an Obligor describing any collateral
securing such Receivable;
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(iii) all guaranties, insurance and other agreements
or arrangements of whatever character from time to time
supporting or securing payment of such Receivable whether
pursuant to the Contract related to such Receivable or
otherwise;
(iv) the Contract and all other books, records and
other information (including, without limitation, computer
programs, tapes, discs, punch cards, data processing software
and related property and rights, subject to the rights of any
licensors and to applicable law) relating to such Receivable
and the related Obligor; and
(v) the Originator Purchase Agreement, the
Secondary Purchase Agreement and the Parent Undertaking
(Originators) and all rights of the Seller to receive monies
due or to become due thereunder,
and (b) with respect to any Participation Interest, the Related
Security with respect to the Government Receivable that is the subject
of such Participation Interest.
"RFA Final Payment Date" means the later of the "Facility
Termination Date" (as such term is defined in the Financing Agreement)
and the date on which all Principal, Yield, fees and other obligations
under the Financing Agreement are paid in full.
"Secondary Purchase Agreement" means the purchase agreement,
dated as of the date hereof, among HQ, as seller and collection agent
and the Seller, as purchaser, as amended or restated from time to time.
"Secured Obligations" has the meaning given to such term in
Section 5.02 hereof.
"Seller Collateral" has the meaning given to such term in
Section 5.02 hereof.
"Seller Report" means a report, in form and substance
satisfactory to the Purchaser, furnished by the Collection Agent to the
Purchaser pursuant to Section 6.02(b).
"Settlement Date" means a Distribution Date (as such term is
defined in the Financing Agreement); provided, however, that following
the occurrence of an Event of Termination, Settlement Dates shall occur
on such days as are selected from time to time by the Purchaser or its
assignees in a written notice to the Collection Agent.
"Transaction Document" means any of this Agreement, the
Originator Purchase Agreement, the Secondary Purchase Agreement, the
Deposit Account Agreements, the Governmental Entity Receivables
Agreements, all amendments to any of the foregoing and all other
agreements and documents delivered and/or related hereto or thereto.
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"UCC" means the Uniform Commercial Code as from time to time
in effect in the relevant jurisdiction.
SECTION 1.02. 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.
ARTICLE II
AMOUNTS AND TERMS OF PURCHASES
SECTION 2.01. Facility. On the terms and conditions
hereinafter set forth and without recourse to the Seller (except to the extent
specifically provided herein), the Seller shall sell and/or contribute to the
capital of the Purchaser all of its right, title and interest in, to and under
(i) all Receivables (other than Government Receivables) acquired by it from time
to time, and (ii) all Participation Interests in all Government Receivables
acquired by it from time to time, and the Purchaser shall purchase and/or accept
as a contribution from the Seller all such Receivables (other than Government
Receivables) and all Participation Interests in Government Receivables of the
Seller from time to time, in each case during the period from the date hereof to
the Facility Termination Date.
SECTION 2.02. Making Purchases.
(a) Initial Purchase. The Seller shall give the Purchaser at
least one Business Day's notice of its request for the initial Purchase, which
request shall specify the date of such Purchase (which shall be a Business Day)
and the proposed Purchase Price for such Purchase. The Purchaser shall promptly
notify the Seller whether it has determined to make such Purchase. On the date
of such Purchase, the Seller shall sell or contribute to the capital of
Purchaser (i) all Receivables (other than Government Receivables) acquired by
the Seller pursuant to the Originator Purchase Agreement and (ii) all
Participation Interests acquired by the Seller pursuant to the Originator
Purchase Agreement, and the Purchaser shall, upon satisfaction of the applicable
conditions set forth in Article III, pay the Purchase Price for such Purchase in
the manner provided in Section 2.02(d). Effective upon such payment, the Seller
hereby sells, conveys, transfers and assigns to the Purchaser (i) all
Receivables (other than Government Receivables) acquired by it and in existence
on the date of the initial Purchase and (ii) all Participation Interests in all
Government Receivables acquired by it and in existence on the date of the
initial Purchase.
(b) Subsequent Purchases. On each Business Day following the
initial Purchase, unless the Seller or the Purchaser shall notify the other
party to the contrary (with a copy to the Collection Agent), the Seller shall
sell to the Purchaser and the Purchaser shall purchase from such Seller, upon
satisfaction of the applicable conditions set forth in Article III, (i) all
Receivables (other than Government Receivables) acquired by the Seller and (ii)
all
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Participation Interests in all Government Receivables acquired by the Seller, in
each case which have not previously been sold and/or contributed to the
Purchaser. The Purchaser shall pay the Purchase Price for such Purchase in the
manner provided in Section 2.02(d). Effective on each Purchase Date, the Seller
hereby sells, conveys, transfers and assigns to the Purchaser (i) all
Receivables (other than Government Receivables) acquired by it and not
previously sold, conveyed, transferred or assigned to the Purchaser and (ii) all
Participation Interests in all Government Receivables acquired by it and not
previously sold, conveyed, transferred or assigned to the Purchaser.
(c) Special Provisions Relating to Sales of Participation
Interests. Pursuant to the Originator Purchase Agreement, each Originator has
agreed, following each sale of a Participation Interest in a Government
Receivable, to hold such Government Receivable and any Related Security,
Collections and proceeds with respect thereto for the benefit of the Seller and
its assigns; provided that such Originator shall take no action in contravention
of any law, rule or regulation applicable to such Government Receivable. It is
understood and agreed that sales of Participation Interests in Government
Receivables shall not include any right to collect the proceeds of any
Government Receivable directly from the applicable Governmental Entity, except
insofar as a court of competent jurisdiction shall order such Governmental
Entity to make such payments directly to the Purchaser or its assigns.
(d) Payment of Purchase Price. The Purchase Price for the
initial Purchase shall be paid on the Purchase Date therefor and the Purchase
Price for each subsequent Purchase shall be paid on the next Settlement Date
(without giving effect to the proviso in the definition thereof) after the
Purchase Date therefor, in each case, by means of any one or a combination of
the following: (i) a deposit in same day funds to the Seller's account
designated by the Seller, and/or (ii) a contribution to the capital of the
Purchaser. To the extent that on any date set for the payment of Purchase Price,
the Purchaser does not have sufficient funds to pay the entire Purchase Price in
cash, the amount in excess of the cash portion of the Purchase Price paid by the
Purchaser shall constitute a contribution to the capital of the Purchaser by the
Seller, and the parties hereto will make the appropriate accounting entries in
their books and records to reflect such allocation of the Purchase Price as
between cash payment and capital contribution. It is agreed by the parties
hereto that the portion of the Purchase Price for the initial Purchase allocated
to a capital contribution is $394,971,504.26.
(e) Ownership of Receivables, Participation Interests and
Related Security. On each Purchase Date, after giving effect to the Purchase on
such date, the Purchaser shall own (i) all Receivables (other than Government
Receivables) acquired by the Seller as of such date (including Receivables which
have been previously sold and/or contributed to the Purchaser hereunder), and
(ii) all Participation Interests in all Government Receivables acquired by the
Seller as of such date (including Participation Interests in Government
Receivables which have been previously sold and/or contributed to the Purchaser
hereunder). The Purchase of any Receivable or Participation Interest shall
include all Related Security with respect to such Receivable or Participation
Interest.
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SECTION 2.03. Collections. (a) Unless otherwise agreed, the
Collection Agent shall, on each Settlement Date, deposit into an account of the
Purchaser or the Purchaser's assignee all Collections of Purchased Assets then
held by the Collection Agent.
(b) In the event that the Seller believes that Collections
which are not Collections of Purchased Assets have been deposited into an
account of the Purchaser or the Purchaser's assignee, the Seller shall notify
the Collection Agent who shall so advise the Purchaser and, on the Business Day
following such identification, the Purchaser shall remit, or shall cause to be
remitted, all Collections so deposited which are identified, to the Purchaser's
satisfaction, to be Collections of Receivables which are not either Purchased
Receivables or Participated Receivables to the Seller.
SECTION 2.04. Settlement Procedures. (a) If on any day any
Purchased Asset becomes (in whole or in part) a Diluted Receivable or a Diluted
Participation Interest (as the case may be), the Seller shall be deemed to have
received on such day a Collection of such Purchased Asset in the amount of such
Diluted Receivable or Diluted Participation Interest (as the case may be). The
Seller shall pay to the Collection Agent on or prior to the next Settlement Date
all amounts deemed to have been received pursuant to this subsection.
(b) Upon discovery by the Seller or the Purchaser of a
breach of any of the representations and warranties made by the Seller in
Section 4.01(j) with respect to any Purchased Asset, such party shall give
prompt written notice thereof to the Purchaser, the Collection Agent, and the
Seller, as soon as practicable and in any event within three Business Days
following such discovery. The Seller shall, upon not less than two Business
Days' notice from the Purchaser or its assignee or designee, repurchase such
Purchased Asset on the next succeeding Settlement Date for a repurchase price
equal to the Outstanding Balance of such Purchased Asset. Each repurchase of a
Purchased Asset shall include the Related Security with respect to such
Purchased Asset. The proceeds of any such repurchase shall be deemed to be a
Collection in respect of such Purchased Asset. The Seller shall pay to the
Collection Agent on or prior to the next Settlement Date the repurchase price
required to be paid pursuant to this subsection.
(c) Except as stated in subsection (a) or (b) of this
Section 2.04 or as otherwise required by law or the underlying Contract, all
Collections from an Obligor of any Purchased Receivable or Participated
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 its payment for application to specific Receivables.
SECTION 2.05. Payments and Computations, Etc. (a) All amounts
to be paid or deposited by the Seller or the Collection Agent hereunder 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 an account or accounts designated by the Purchaser from
time to time, which accounts, during the existence of the Financing Agreement,
shall be those set forth in the Financing Agreement.
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(b) The Seller shall, to the extent permitted by law, pay to
the Purchaser interest on any amount not paid or deposited by the Seller
(whether as Collection Agent or otherwise) when due hereunder at an interest
rate per annum equal to 2% per annum above the Alternate Base Rate, payable on
demand.
(c) All computations of interest and all computations of
fees hereunder shall be made on the basis of a year of 360 days for the actual
number of days (including the first but excluding the last day) 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
succeeding Business Day and such extension of time shall be included in the
computation of such payment or deposit.
ARTICLE III
CONDITIONS OF PURCHASES
SECTION 3.01. Conditions Precedent to Initial Purchase from
the Seller. The initial Purchase of Receivables and/or Participation Interests
from the Seller hereunder is subject to the conditions precedent that the
Purchaser shall have received on or before the date of such Purchase the
following, each (unless otherwise indicated) dated such date, in form and
substance satisfactory to the Purchaser:
(a) Certified copies of the resolutions (or similar
authorization, if not a corporation) of the Board of Directors (or
similar governing body or Persons, if not a corporation) of the Seller
approving this Agreement and certified copies of all documents
evidencing other necessary corporate action and governmental approvals,
if any, with respect to this Agreement.
(b) A certificate of the Secretary or Assistant Secretary
of the Seller certifying the names and true signatures of the officers
of such Seller authorized to sign this Agreement and the other
documents to be delivered by it hereunder.
(c) Copies of proper financing statements, duly filed on
or before the date of the initial Purchase, naming the Seller as the
seller/debtor and the Purchaser as the purchaser/secured party, or
other similar instruments or documents, as the Purchaser may deem
necessary or desirable under the UCC of all appropriate jurisdictions
or other applicable law to perfect the Purchaser's ownership of and
security interest in the Purchased Assets and Related Security and
Collections with respect thereto.
(d) Copies of proper financing statements, if any,
necessary to release all security interests and other rights of any
Person in the Purchased Assets, Contracts or Related Security
previously granted by the Seller, except those evidencing security
interests subject to the Intercreditor Agreement.
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(e) Completed requests for information, dated on or before
the date of such initial Purchase, listing all effective financing
statements filed in the jurisdictions referred to in subsection (c)
above that name the Seller as debtor, together with copies of such
other financing statements (none of which shall cover any Purchased
Assets, Contracts or Related Security except those evidencing security
interests subject to the Intercreditor Agreement).
(f) A favorable opinion of (i) Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel for the Seller, in form and substance
satisfactory to the Purchaser, (ii) Xxxxxxx & Xxxxxx relating to
various states' local perfection issues and (iii) Parent's general
counsel, in each case, as to such matters as the Purchaser may
reasonably request, and
(g) Executed copies of (i) Deposit Account Agreements with
each Deposit Bank and (ii) Governmental Entity Receivables Agreements
with each Account Bank.
(h) A copy of the Memorandum and Articles of Association
of the Seller, certified by the Secretary or Assistant Secretary of
the Seller.
SECTION 3.02. Conditions Precedent to All Purchases.
Each Purchase (including the initial Purchase) hereunder shall be
subject to the further conditions precedent that:
(a) with respect to any such Purchase, on or prior to the
date of such Purchase, the Seller shall have delivered to the
Purchaser, if requested by the Purchaser, (i) the Seller's General
Trial Balance (which if in magnetic tape or diskette format shall be
compatible with the Purchaser's computer equipment) as of a date not
more than 31 days prior to the date of such Purchase, and (ii) such
additional information concerning the Receivables and Participation
Interests to be purchased as may reasonably be requested by the
Purchaser;
(b) with respect to any such Purchase, on or prior to the
date of such Purchase, the Collection Agent shall have delivered to
the Purchaser, in form and substance satisfactory to the Purchaser, a
completed Seller Report for the most recently ended reporting period
for which information is required pursuant to Section 6.02(b) and
containing such additional information as may reasonably be requested
by the Purchaser;
(c) the Seller shall have marked its master data
processing records and, at the request of the Purchaser, each Contract
giving rise to Purchased Assets and all other relevant records
evidencing the Receivables and Participation Interests which are the
subject of such Purchase with a legend, acceptable to the Purchaser,
stating that such Receivables and Participation Interests, together
with the Related Security and Collections with respect thereto, have
been sold in accordance with this Agreement; and
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(d) on the date of such Purchase the following statements
shall be true (and the Seller, by accepting the Purchase Price for such
Purchase, shall be deemed to have certified that):
(i) The representations and warranties made by the
Seller in Section 4.01 are correct on and as of the date of
such Purchase as though made on and as of such date,
(ii) No event has occurred and is continuing, or
would result from such Purchase, that constitutes an Event of
Termination or an Incipient Event of Termination and
(iii) The Purchaser shall not have delivered to the
Seller a notice that the Purchaser shall not make any further
Purchases hereunder; and
(e) the Purchaser shall have received such other
approvals, opinions or documents as the Purchaser may reasonably
request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Seller.
The Seller represents and warrants as follows:
(a) The Seller is an exempted company incorporated with
limited liability validly existing and in good standing under the laws
of the Cayman Islands, and is duly qualified to do business, and is in
good standing, in every jurisdiction where the nature of its business
requires it to be so qualified.
(b) The execution, delivery and performance by the Seller
of this Agreement and the other documents to be delivered by it
hereunder, including the Seller's sale of Receivables and
Participation Interests hereunder and the Seller's use of the proceeds
of Purchases, (i) are within the Seller's corporate powers, (ii) have
been duly authorized by all necessary corporate action, (iii) do not
contravene (1) the Seller's Memorandum and Articles of Association,
(2) any law, rule or regulation applicable to the Seller, (3) any
contractual restriction binding on or affecting the Seller or its
property or (4) any order, writ, judgment, award, injunction or decree
binding on or affecting the Seller or its property, and (iv) do not
result in or require the creation of any lien, security interest or
other charge or encumbrance upon or with respect to any of its
properties (except for the interest created pursuant to this
Agreement). This Agreement has been duly executed and delivered by the
Seller.
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(c) No authorization or approval or other action by, and
no notice to or filing with, any governmental authority or regulatory
body is required for the due execution, delivery and performance by
the Seller of this Agreement or any other document to be delivered by
it hereunder, except for the filing of UCC financing statements
referred to herein.
(d) Each of the Transaction Documents to which it is a
party constitutes the legal, valid and binding obligation of the
Seller enforceable against the Seller in accordance with its terms,
subject to applicable bankruptcy, insolvency, moratorium or other
similar laws affecting the rights of creditors generally and general
equitable principles (whether considered in a proceeding at law or in
equity).
(e) Purchases made pursuant to this Agreement will
constitute a valid sale, transfer, and assignment of the Purchased
Assets to, or contributions of the Purchased Assets to the capital of,
the Purchaser, enforceable against creditors of, and purchasers from,
the Seller. The Seller shall have no remaining property interest in
any Purchased Asset.
(f) (i) The fair value of the property of the Seller is
greater than the total amount of liabilities, including contingent
liabilities, of the Seller, (ii) the present fair salable value of the
assets of the Seller is not less than the amount that will be required
to pay all probable liabilities of the Seller on its debts as they
become absolute and matured, (iii) the Seller does not intend to, and
does not believe that it will, incur debts or liabilities beyond the
Seller's abilities to pay such debts and liabilities as they mature and
(iv) the Seller is not engaged in a business or a transaction, and is
not about to engage in a business or a transaction, for which the
Seller's property would constitute unreasonably small capital.
(g) There is no pending or threatened action,
investigation or proceeding affecting the Seller or any of its
subsidiaries before any court, governmental agency or arbitrator which
if determined adversely to any of them, could reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.
(h) No proceeds of any Purchase will be used to acquire
any equity security of a class which is registered pursuant to Section
12 of the Securities Exchange Act of 1934.
(i) No transaction contemplated hereby requires compliance
with any bulk sales act or similar law.
(j) Each Receivable (including, without limitation, each
Participated Receivable) sold and/or contributed by the Seller and
characterized in any Seller Report (or, if applicable, as of a date
certain specified in such report) as an Eligible Receivable is, as of
the date of such Seller Report, an Eligible Receivable. Each Purchased
Asset, together with the Related Security, is owned (immediately prior
to its sale hereunder) by
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the Seller free and clear of any Adverse Claim (other than any Adverse
Claim arising solely as the result of any action taken by the
Purchaser). When the Purchaser makes a Purchase it shall acquire valid
and perfected first priority ownership of each Purchased Asset and the
Related Security and Collections with respect thereto free and clear of
any Adverse Claim (other than any Adverse Claim arising solely as the
result of any action taken by the Purchaser), and no effective
financing statement or other instrument similar in effect covering any
Purchased Asset, any interest therein, the Related Security or
Collections with respect thereto is on file in any recording office
except such as may be filed in favor of HQ as purchaser under the
Originator Purchase Agreement, in favor of the Seller in accordance
with the Secondary Purchase Agreement, in favor of Purchaser in
accordance with this Agreement or in connection with any Adverse Claim
arising solely as the result of any action taken by the Purchaser or
those which relate to security interests that are subject to the
Intercreditor Agreement.
(k) Each Seller Report (if prepared by the Seller, or to
the extent that information contained therein is supplied by the
Seller), information, exhibit, financial statement, document, book,
record or report furnished or to be furnished at any time (whether
before or after the date of this Agreement) by the Seller to the
Purchaser in connection with this Agreement is or will be accurate in
all material respects as of its date or (except as otherwise disclosed
to the Purchaser at such time) as of the date so furnished (or, if
applicable, as of a date certain specified in such report), and no
such document contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact necessary
in order to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading.
(l) The principal place of business and chief executive
office of the Seller and the office where such Seller keeps its
records concerning the Purchased Assets are located at the address or
addresses referred to in Section 5.01(b).
(m) The names and addresses of all the Deposit Banks and
Account Banks, together with the post office boxes and account numbers
of the Lock-Boxes, Deposit Accounts at such Deposit Banks, and
Governmental Entity Receivables Accounts at such Account Banks are
specified in Exhibit B (as the same may be updated from time to time
pursuant to Section 5.01(g)). The Lock-Boxes, Deposit Accounts and
Governmental Entity Receivables Accounts are the only post office boxes
and bank accounts into which Collections of Receivables and
Participation Interests are deposited or remitted.
(n) The Seller is not known by and does not use any
tradename or doing- business-as name.
(o) With respect to any programs used by HQ in the
servicing of the Receivables and Participation Interests, no
sublicensing agreements are necessary in connection with the
designation of a new Collection Agent pursuant to Section 6.01 so that
such new Collection Agent shall have the benefit of such programs (it
being understood
21
that, however, the Collection Agent, if other than HQ, shall be
required to be bound by a confidentiality agreement reasonably
acceptable to HQ (on behalf of itself and each of the Originators)).
(p) The transfers of Purchased Assets by the Seller to the
Purchaser pursuant to this Agreement, and all other transactions
between the Seller and the Purchaser, have been and will be made in
good faith and without intent to hinder, delay or defraud creditors of
such Seller.
(q) The Seller has timely filed or caused to be filed all
required income tax and sales tax returns and reports and all other
material tax returns and reports required to have been filed and has
paid or caused to be paid all material taxes due pursuant to such
returns or pursuant to any assessment received by the Seller, except
where the payment of any such taxes is being contested in good faith by
appropriate proceedings and for which the Seller has set aside on its
books adequate reserves. The charges, accruals and reserves on the
books of the Seller in respect of such taxes or charges imposed by all
Governmental Entities are, in the opinion of the Seller, adequate for
the payment thereof.
(r) The Seller was incorporated on August 11, 2004 under
the name Cayman Resources (21) Ltd., and the Seller did not engage in
any business activities prior to the date of this Agreement.
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Seller. The Seller covenants
from the date hereof until the first day following the Facility Termination Date
on which all of the Purchased Assets are either collected in full or become
Defaulted Receivables or Defaulted Participation Interests (as the case may be):
(a) Compliance with Laws, Etc. The Seller will 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 could not reasonably be expected to
result in a Material Adverse Effect.
(b) Offices, Records, Name and Organization. The Seller
will keep its principal place of business and chief executive office
and the office where it keeps its records concerning the Purchased
Assets at the address of the Seller set forth on Exhibit D hereto or,
upon 30 days' prior written notice to the Purchaser and its assignees,
at any other locations within the United States. The Seller will not
change its name or its
22
jurisdiction of organization, unless (i) the Seller shall have provided
the Purchaser and its assignees with at least 30 days' prior written
notice thereof and (ii) no later than the effective date of such
change, all actions required by Section 5.01(j) shall have been taken
and completed. The Seller also will maintain and implement
administrative and operating procedures (including, without limitation,
an ability to recreate records evidencing Purchased Assets and related
Contracts in the event of the destruction of the originals thereof),
and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Purchased Assets (including, without limitation, records adequate to
permit the daily identification of each new Purchased Asset and all
Collections of and adjustments to each existing Purchased Asset). The
Seller shall make a notation in its books and records, including its
computer files, to indicate that all of its Receivables and
Participation Interests have been sold by it to the Purchaser
hereunder.
(c) Performance and Compliance with Contracts and Credit
and Collection Policy. The Seller will, at its expense, timely and
fully perform and comply with all material provisions, covenants and
other promises required to be observed by it under the Contracts
related to the Purchased Receivables and Participated Receivables, and
timely and fully comply in all material respects with the Credit and
Collection Policy in regard to each Purchased Receivable, each
Participated Receivable and the related Contract.
(d) Sales, Liens, Etc. Except for the sales of Purchased
Assets contemplated herein, the Seller will 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
Purchased Asset, Receivable, Related Security, related Contract or
Collections, or upon or with respect to any account to which any
Collections of any Purchased Asset are sent, or assign any right to
receive income in respect thereof.
(e) Extension or Amendment of Purchased Assets. Except as
provided in Section 6.02(c), the Seller will not extend, amend or
otherwise modify the terms of any Purchased Receivable or Participated
Receivable, or amend, modify or waive any term or condition of any
Contract (to which it is a party) related thereto.
(f) Change in Business or Credit and Collection Policy.
The Seller will not make any change in the character of its business
or in the Credit and Collection Policy that could, in either case,
reasonably be expected to result in a Material Adverse Effect.
(g) Change in Payment Instructions to Obligors. The Seller
will not add or terminate any post office box, bank, or bank account as
a Lock-Box, Deposit Bank, Deposit Account, Governmental Entity
Receivables Account or Account Bank from those listed in Exhibit B to
this Agreement, or make any change in its instructions to Obligors
regarding payments to be made to any such box or account, unless the
Purchaser shall have received notice of such addition, termination or
change (including an updated Exhibit B) and a fully executed Deposit
Account Agreement or Governmental Entity Receivables
23
Agreement with each new Deposit Bank or Account Bank, as the case may
be, with respect to each new Lock-Box, Deposit Account, or Governmental
Entity Receivables Account.
(h) Deposits to Lock-Boxes, Deposit Accounts and
Governmental Entity Receivables Accounts. The Seller will instruct all
of the Obligors that are Governmental Entities other than Contract
Payers to remit all their payments in respect of Participated
Receivables to Governmental Entity Receivables Accounts or Lock-Boxes
associated therewith. The Seller will instruct all of its Obligors
that are not Governmental Entities (other than Contract Payors) to
remit all their payments in respect of Purchased Receivables to
Deposit Accounts or Lock-Boxes associated therewith. If the Seller
shall receive any Collections directly, it shall immediately (and in
any event within one Business Day) deposit the same to a Deposit
Account or Governmental Entity Receivables Account, as the case may
be. The Seller will not deposit or otherwise credit, or cause or
permit to be so deposited or credited, to any Lock-Box, Deposit
Account or Governmental Entity Receivables Account cash or cash
proceeds other than Collections of Purchased Receivables and
Participated Interests except as provided in the last sentence of this
Section 5.01(h).
In furtherance of the foregoing, the Collection Agent agrees
(i) within 30 days from the date of this Agreement, to notify all
Obligors that are not Governmental Entities (other than Contract
Payors) to remit all their payments in respect of Purchased Receivables
to Deposit Accounts or Lock-Boxes associated therewith and (ii)
thereafter, to use ongoing commercially reasonable efforts to obtain
compliance with such notice from those Obligors who have failed to so
comply. The foregoing notwithstanding the Collection Agent acknowledges
that collections on account of accounts receivable belonging to
Xxxxxxxxx.xxx are regularly deposited into the Governmental Entity
Receivables Account and agrees to identify and remove such collections
(from such account) within two Business Days after they are received.
(i) Audits. The Seller will, from time to time during
regular business hours as requested by the Purchaser or its assigns,
permit the Purchaser, or its agents, representatives or assigns, (i)
to examine and make copies of and abstracts from all books, records
and documents (including, without limitation, computer tapes and
disks) in the possession or under the control of the Seller relating
to Purchased Assets and the Related Security, including, without
limitation, the related Contracts, and (ii) to visit the offices and
properties of the Seller for the purpose of examining such materials
described in clause (i) above, and to discuss matters relating to
Purchased Assets and the Related Security or the Seller's performance
hereunder or under the Contracts with any of the officers or employees
of the Seller having knowledge of such matters.
(j) Further Assurances. (i) The Seller agrees from time to
time, at its expense, promptly to execute and deliver all further
instruments and documents, and to take all further actions, that may be
necessary or desirable, or that the Purchaser or its assignees
24
may reasonably request, to perfect, protect or more fully evidence the
sale of Purchased Assets under this Agreement, or to enable the
Purchaser or its assignees to exercise and enforce its respective
rights and remedies under this Agreement. Without limiting the
foregoing, the Seller will, upon the request of the Purchaser or its
assignees, (A) execute and file such financing or continuation
statements, or amendments thereto, and such other instruments and
documents, that may be necessary or desirable to perfect, protect or
evidence such Purchased Assets; and (B) deliver to the Purchaser copies
of all Contracts (to which it is a party) relating to the Purchased
Assets and all records relating to such Contracts and the Purchased
Assets, whether in hard copy or in magnetic tape or diskette format
(which if in magnetic tape or diskette format shall be compatible with
the Purchaser's computer equipment).
(ii) The Seller authorizes the Purchaser or its
assignees to file financing or continuation statements, and amendments
thereto and assignments thereof, relating to the Purchased Assets and
the Related Security, the related Contracts and the Collections with
respect thereto. Such financing statements filed against the Seller may
describe the collateral in the same manner specified in Section 5.02
hereof or in any other manner as the Purchaser or its assignees may
reasonably determine is necessary to ensure the perfection of such
security interest, including, without limitation, describing such
property as all assets or all personal property of the Seller whether
now owned or hereafter acquired.
(k) Reporting Requirements. The Seller will provide to the
Purchaser the following:
(i) any reports, notices, public filings,
financial information and any other information or correspondence
delivered to the Seller pursuant to the Secondary Purchase Agreement;
(ii) as soon as possible and in any event within
five days after the occurrence of each Event of Termination or
Incipient Event of Termination, a statement of a Financial Officer of
the Seller setting forth details of such Event of Termination or
Incipient Event of Termination and the action that the Seller has taken
and proposes to take with respect thereto;
(iii) at least 30 days prior to any change in the
Seller's name or state of incorporation, a notice setting forth the new
name or state of incorporation and the effective date thereof; and
(iv) such other information respecting the
Purchased Assets or the condition or operations, financial or
otherwise, of the Seller as the Purchaser may from time to time
reasonably request, to the extent such disclosure is permitted under
applicable law, rule or regulation.
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Reports and financial statements required to be delivered pursuant to
clauses (i) and (ii) of Section 5.01(k) of the Originator Purchase
Agreement (which are required to be delivered to the Seller pursuant to
the Secondary Purchase Agreement) shall be deemed to have been
delivered on the date on which the Parent posts such reports, or
reports containing such financial statements, on the Parent's website
on the internet at xxxx://xxx.xxxxxxx.xxx or when such reports, or
reports containing such financial statements, are posted on the SEC's
website at xxx.xxx.xxx.
(l) Separate Conduct of Business. The Seller will: (i)
maintain separate corporate records and books of account from those of
the Purchaser; (ii) conduct its business from an office separate from
that of the Purchaser (but which may be located in the same facility as
the Purchaser); (iii) ensure that all oral and written communications,
including without limitation, letters, invoices, purchase orders,
contracts, statements and applications, will be made solely in its own
name; (iv) have stationery and other business forms and a mailing
address and a telephone number separate from those of the Purchaser;
(v) not hold itself out as having agreed to pay, or as being liable for
the obligations of the Purchaser; (vi) not engage in any transaction
with the Purchaser except as contemplated by this Agreement or as
permitted by the other Transaction Documents; and (vii) in its capacity
as shareholder of the Purchaser, not adopt any special resolution for
the voluntary winding up of the Purchaser without the prior written
consent of the Program Agent under the Financing Agreement.
(m) Secondary Purchase Agreement. The Seller will not
amend, waive or modify any provision of the Secondary Purchase
Agreement or waive the occurrence of any "Event of Termination" under
the Secondary Purchase Agreement, without in each case the prior
written consent of the Purchaser and its assignees; provided, however,
that the Seller may amend the percentage set forth in the definition
of "Discount" in the Secondary Purchase Agreement in accordance with
the provisions of the Secondary Purchase Agreement without the consent
of the Purchaser and its assignees, provided, further, that the Seller
shall promptly notify the Purchaser and its assignees of any such
amendment. The Seller will perform all of its obligations under the
Secondary Purchase Agreement in all material respects and will enforce
the Secondary Purchase Agreement in accordance with its terms in all
material respects.
(n) Additional Information. If additional information is
requested by the Obligor as to a xxxx or supporting claim documents,
the Seller has or will (or will cause the applicable Originator to)
promptly provide the same, and if any error has been made with respect
to such information, the Seller will (or will cause the applicable
Originator to) promptly correct the same and, if necessary, rebill such
Receivable.
(o) Nature of Business. The Seller will not engage in any
business other than the purchase or acquisition of Receivables,
Participation Interests, Related Security and Collections from HQ and
the transactions contemplated by this Agreement. The Seller will not
create or form any Subsidiary other than the Purchaser.
26
(p) Mergers, Etc. The Seller will not merge with or into
or consolidate with or into, or convey, transfer, lease or otherwise
dispose of (whether in one transaction or in a series of
transactions), all or substantially all of its assets (whether now
owned or hereafter acquired) to, or acquire all or substantially all
of the assets or capital stock or other ownership interest of, or
enter into any joint venture or partnership agreement with, any
Person, other than as specifically contemplated by this Agreement and
the other Transaction Documents.
(q) Distributions, Etc. The Seller will not declare or
make any dividend payment or other distribution of assets, properties,
cash, rights, obligations or securities on account of any shares of
any class of equity interests of the Seller, or return any capital to
its shareholders as such, or purchase, retire, defease, redeem or
otherwise acquire for value or make any payment in respect of any
shares of any class of equity of the Seller or any warrants, rights or
options to acquire any such shares, now or hereafter outstanding;
provided, however, that the Seller may declare and pay cash dividends
on its share capital to its shareholders so long as (i) no Event of
Termination shall then exist or would occur as a result thereof, (ii)
such dividends are in compliance with all applicable law including the
laws of The Cayman Islands, and (iii) such dividends have been
approved by all necessary and appropriate corporate action of the
Seller.
(r) Debt. The Seller will not incur any Debt.
(s) Memorandum and Articles of Association. The Seller
will not amend, modify or delete any provision of its Memorandum and
Articles of Association without the prior written consent of the
Program Agent under the Financing Agreement.
SECTION 5.02. Grant of Security Interest. The Seller and the
Purchaser intend that the transfer of each Purchased Receivable and
Participation Interest hereunder from the Seller to the Purchaser be treated as
a sale of all of the Seller's right, title and interest in, to and under such
Purchased Receivable and Participation Interest and that, immediately after
giving effect to the transfer, the Seller has no further interest (legal or
equitable) in any Purchased Receivable or Participation Interest. The Seller and
the Purchaser shall record each Purchase as a sale or purchase, as the case may
be, on its books and records, and reflect each Purchase in its financial
statements and tax returns as a sale or purchase, as the case may be. In the
event that, contrary to the mutual intent of the Seller and the Purchaser, any
Purchase of Purchased Receivables and/or Participation Interests hereunder is
not characterized as a sale but rather as a collateral transfer for security (or
the transactions contemplated hereby are characterized as a financing
transaction), such Purchase shall be deemed to be a secured financing, secured
by a security interest in all of the Seller's right, title and interest now or
hereafter existing and hereafter arising in, to and under (i) all Receivables
now existing and hereafter arising, (ii) all Participation Interests, (iii) all
Related Security, (iv) all Collections with respect to the items in clauses (i)
through (iii), (v) all other assets, including without limitation, accounts,
chattel paper, instruments, payment intangibles and general intangibles (as
those terms are defined in the UCC) and (vi) all proceeds of the foregoing
(collectively, the "Seller Collateral"). In furtherance of the foregoing, the
Seller
27
hereby grants, to the Purchaser a security interest in all of the Seller's
right, title and interest now or hereafter existing in, to and under the Seller
Collateral to secure the repayment of all amounts due and owing by the Seller to
the Purchaser hereunder with accrued interest thereon, if applicable, whether
now or hereafter existing, due or to become due, direct or indirect, or absolute
or contingent (such amounts the "Secured Obligations").
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. Designation of Collection Agent. The servicing,
administration and collection of the Purchased Assets shall be conducted by such
Person (the "Collection Agent") so designated hereunder from time to time. Until
the RFA Final Payment Date, HQ (or such other Person as may be designated from
time to time under the Financing Agreement) is hereby designated as, and hereby
agrees to perform the duties and obligations of, the Collection Agent pursuant
to the terms hereof. Thereafter, the Purchaser, by notice to HQ and the Seller,
may designate as Collection Agent any Person (including itself) to succeed HQ or
any successor Collection Agent, if such Person shall consent and agree to the
terms hereof. Upon HQ's receipt of such notice, HQ agrees that it will terminate
its activities as Collection Agent hereunder in a manner which the Purchaser (or
its designee) believes will facilitate the transition of the performance of such
activities to the new Collection Agent, and HQ shall use its best efforts to
assist the Purchaser (or its designee) to take over the servicing,
administration and collection of the Purchased Assets, including, without
limitation, providing access to and copies of all computer tapes or disks and
other documents or instruments that evidence or relate to Purchased Assets
maintained by HQ in its capacity as Collection Agent and access to all employees
and officers of HQ responsible with respect thereto. The Collection Agent may,
with the prior consent of the Purchaser, subcontract with any other Person for
the servicing, administration or collection of Purchased Assets. Any such
subcontract shall not affect the Collection Agent's liability for performance of
its duties and obligations pursuant to the terms hereof, and any such
subcontract shall terminate upon designation of a successor Collection Agent.
SECTION 6.02. Duties of Collection Agent. (a) The Collection
Agent shall take or cause to be taken all such actions as may be necessary or
advisable to collect each Purchased Asset from time to time, all in accordance
in all material respects with applicable laws, rules and regulations, with
reasonable care and diligence, and in accordance with the Credit and Collection
Policy. The Purchaser hereby appoints the Collection Agent, from time to time
designated pursuant to Section 6.01, as agent to enforce its ownership and other
rights in the Purchased Assets, the Related Security and the Collections with
respect thereto. In performing its duties as Collection Agent, the Collection
Agent shall exercise the same care and apply the same policies as it would
exercise and apply if it owned the Purchased Assets and shall act in the best
interests of the Purchaser and its assignees.
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(b) On or before each Determination Date, the Collection
Agent shall prepare and forward to the Purchaser (i) a Seller Report, relating
to all then outstanding Purchased Assets, and the Related Security and
Collections with respect thereto, in each case, as of the close of business of
the Collection Agent on the last day of the immediately preceding Month, and
(ii) if requested by the Purchaser, a listing by Obligor (other than Contract
Payors) of all Purchased Assets, together with an aging report of such Purchased
Assets.
(c) If no Event of Termination or Incipient Event of
Termination shall have occurred and be continuing, HQ, while it is the
Collection Agent, may, in accordance with the Credit and Collection Policy,
extend the maturity or adjust the Outstanding Balance of any Purchased
Receivable or Participated Receivable as it deems appropriate to maximize
Collections thereof, or otherwise amend or modify other terms of any Purchased
Receivable or Participated Receivable.
(d) The Seller shall deliver to the Collection Agent, and
the Collection Agent shall hold in trust for the Seller and the Purchaser in
accordance with their respective interests, all documents, instruments and
records (including, without limitation, computer tapes or disks) which evidence
or relate to Purchased Assets.
(e) The Collection Agent shall as soon as practicable
following receipt turn over to the Seller (or other person entitled thereto) any
cash collections or other cash proceeds received with respect to Receivables not
constituting Purchased Receivables or Participated Receivables.
(f) The Collection Agent also shall perform the other
obligations of the "Collection Agent" set forth in this Agreement with respect
to the Purchased Assets.
SECTION 6.03. Collection Agent Fee. The Purchaser shall pay to
the Collection Agent, so long as it is acting as the Collection Agent hereunder,
a periodic collection fee (the "Collection Agent Fee") of 1.00% per annum on the
average daily aggregate Outstanding Balance of the Purchased Assets, payable in
arrears on each Settlement Date or such other day during each Month as the
Purchaser and the Collection Agent shall agree. So long as the Financing
Agreement is in effect, amounts paid to the Collection Agent as "Collection
Agent Fee" pursuant to the Financing Agreement shall reduce, on a
dollar-for-dollar basis, the obligation of the Purchaser to pay the Collection
Agent Fee hereunder, provided that such obligation of the Purchaser shall in no
event be reduced below zero.
SECTION 6.04. Certain Rights of the Purchaser. (a) The
Purchaser may, at any time during the existence of an Event of Termination or
Incipient Event of Termination, give notice of ownership and/or direct the
Obligors of Purchased Assets and any Person obligated on any Related Security,
or any of them, that payment of all amounts payable under any Purchased Asset
shall be made directly to the Purchaser or its assignees. The Seller hereby
transfers to the Purchaser (and its assigns and designees) the exclusive
ownership and control of the Lock-Boxes
29
and Deposit Accounts maintained by the Seller for the purpose of receiving
Collections (other than Collections from Governmental Entities).
(b) The Seller shall, at any time during the existence of
an Event of Termination or Incipient Event of Termination upon the Purchaser's
request and at the Seller's expense, give notice of the Purchaser's ownership to
each Obligor of Purchased Assets and, to the extent permitted under applicable
law, direct that payments of all amounts payable under the Purchased Receivables
or Participated Receivables be made directly to the Purchaser or its assignees.
(c) At the Purchaser's request and at the Seller's
expense, the Seller and the Collection Agent shall (A) assemble all of the
documents, instruments and other records (including, without limitation,
computer tapes and disks) that evidence or relate to the Purchased Assets, and
the related Contracts and Related Security, or that are otherwise necessary or
desirable to collect the Purchased Receivables and Participated Receivables, and
shall make the same available to the Purchaser at a place selected by the
Purchaser or its designee, and (B) segregate all cash, checks and other
instruments received by it from time to time constituting Collections of
Purchased Assets in a manner acceptable to the Purchaser and, promptly upon
receipt, remit all such cash, checks and instruments, duly indorsed or with duly
executed instruments of transfer, to the Purchaser or its designee. The
Purchaser shall also have the right to make copies of all such documents,
instruments and other records at any time.
(d) The Seller authorizes the Purchaser to take any and
all steps in the Seller's name and on behalf of the Seller that are necessary or
desirable, in the determination of the Purchaser, to collect amounts due under
the Purchased Receivables and Participated Receivables, including, without
limitation, endorsing the Seller's name on checks and other instruments
representing Collections of Purchased Assets and enforcing the Purchased
Receivables and Participated Receivables and the Related Security and related
Contracts.
SECTION 6.05. Rights and Remedies. (a) If the Seller or the
Collection Agent fails to perform any of its obligations under this Agreement,
the Purchaser may (but shall not be required to) (after notice to the Seller or
Collection Agent and such failure to perform, if capable of being cured, is not
cured within 10 days after such notice is sent) itself perform, or cause
performance of, such obligation, and, if the Seller (as Collection Agent or
otherwise) fails to so perform, the costs and expenses of the Purchaser incurred
in connection therewith shall be payable by the Seller as provided in Section
8.01 or Section 9.04 as applicable.
(b) The Seller shall perform all of its obligations under
the Contracts related to the Purchased Receivables and Participated Receivables
to the same extent as if the Seller had not sold Receivables or Participation
Interests hereunder and the exercise by the Purchaser of its rights hereunder
shall not relieve the Seller from such obligations or its obligations with
respect to the Purchased Receivables and Participated Receivables. The Purchaser
shall not have any obligation or liability with respect to any Purchased
Receivables and Participated Receivables or related
30
Contracts, nor shall the Purchaser be obligated to perform any of the
obligations of the Seller thereunder.
(c) The Seller shall cooperate with the Collection Agent
in collecting amounts due from Obligors in respect of the Purchased Receivables
and Participated Receivables.
(d) The Seller hereby grants to Collection Agent an
irrevocable power of attorney, with full power of substitution, coupled with an
interest, to take in the name of the Seller all steps necessary or advisable to
endorse, negotiate or otherwise realize on any writing or other right of any
kind held or transmitted by the Seller or transmitted or received by Purchaser
(whether or not from the Seller) in connection with any Purchased Asset.
SECTION 6.06. Transfer of Records to Purchaser. Each Purchase
of Receivables and Participation Interests hereunder shall include the transfer
to the Purchaser of all of the Seller's right and title to and interest in the
records relating to such Receivables or Participation Interests (as the case may
be) and, subject to the rights of any licensors and applicable law, shall
include an irrevocable non-exclusive license to the use of the Seller's computer
software system to access and create such records. Such license shall be without
royalty or payment of any kind, is coupled with an interest, and shall be
irrevocable until all of the Purchased Assets are either collected in full or
become Defaulted Receivables or Defaulted Participation Interests (as the case
may be).
The Seller shall take such action requested by the Purchaser,
from time to time hereafter, that may be necessary or appropriate to ensure that
the Purchaser has an enforceable ownership interest in the records relating to
the Purchased Assets and rights (whether by ownership, license or sublicense) to
the use of the Seller's computer software system to access and create such
records, subject to the rights of any licensors and applicable law.
In recognition of the Seller's need to have access to the
records transferred to the Purchaser hereunder, the Purchaser hereby grants to
the Seller an irrevocable license to access such records in connection with any
activity arising in the ordinary course of the Seller's business or in
performance of its duties as Collection Agent, provided that (i) the Seller
shall not disrupt or otherwise interfere with the Purchaser's use of and access
to such records during such license period and (ii) the Seller consents to the
assignment and delivery of the records (including any information contained
therein relating to the Seller or its operations) to any assignees or
transferees of the Purchaser provided they agree to hold such records
confidential.
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01. Events of Termination. If any of the following
events ("Events of Termination") shall occur and be continuing:
31
(a) The Collection Agent (i) shall fail to perform or
observe any term, covenant or agreement under this Agreement (other
than as referred to in clause (ii) or (iii) of this subsection (a))
and such failure, if capable of being cured, shall remain unremedied
for ten days or (ii) shall fail to make when due any payment or
deposit to be made by it under this Agreement or (iii) shall fail to
deliver any Seller Report when required and such failure shall remain
unremedied for one Business Day (provided that the grace period in
this clause (iii) may not be utilized more than once in any Month); or
(b) The Seller shall fail to make any payment required
under Section 2.04(a) or 2.04(b); or
(c) Any representation or warranty (unless such
representation or warranty relates solely to one or more specific
Receivables incorrectly characterized as Eligible Receivables and the
Seller shall have made any required deemed Collection payment pursuant
to Section 2.04 with respect to such Receivables) made or deemed made
by the Seller (or any of its officers) under or in connection with
this Agreement or any information or report delivered by the Seller
pursuant to this Agreement shall prove to have been incorrect or
untrue in any material respect when made or deemed made or delivered;
or
(d) The Seller shall fail to perform or observe any other
term, covenant or agreement contained in this Agreement on its part to
be performed or observed and any such failure shall remain unremedied
for 10 days, provided that failure to perform or observe any covenant
contained in Sections 5.01(b), 5.01(d), 5.01(g), and 5.01(h) shall not
be entitled to the benefit of such 10-day period; or
(e) The Seller or the Collection Agent shall fail to pay
any principal of or premium or interest on any of its Debt which is
outstanding in a principal amount of at least $25,000,000 in the
aggregate 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 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; or any
such Debt shall be declared to be due and payable, or required to be
prepaid (other than by a regularly scheduled required prepayment),
redeemed, purchased or defeased, or an offer to repay, redeem,
purchase or defease such Debt shall be required to be made, in each
case prior to the stated maturity thereof; or
(f) Any Purchase of Receivables or Participation Interests
hereunder, the Related Security and the Collections with respect
thereto shall for any reason cease to constitute valid and perfected
ownership of such Receivables, Participation Interests, Related
Security and Collections free and clear of any Adverse Claim; or
32
(g) The Seller or the Collection Agent 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 or the Collection Agent seeking to
adjudicate it a bankrupt or insolvent, or seeking liquidation, winding
up (whether such Person is insolvent or not), 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, without limitation, 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 any proceeding or
petition shall be instituted or adopted for the winding up of the
Seller (whether or not in the context of a bankruptcy or insolvency
proceeding); or the Seller shall take any corporate action to
authorize any of the actions set forth above in this subsection (g);
or
(h) An Event of Termination shall have occurred under the
Originator Purchase Agreement, the Secondary Purchase Agreement or the
Financing Agreement; or
(i) There shall have occurred any event which may
materially adversely affect the collectibility of the Purchased Assets
or the ability of the Seller or the Collection Agent to collect
Purchased Assets or otherwise perform its respective obligations under
this Agreement;
then, and in any such event, the Purchaser may in its sole discretion without
regard to Section 9.08, by notice to the Parent and the Seller take either or
both of the following actions: (x) declare the Facility Termination Date to have
occurred (in which case the Facility Termination Date shall be deemed to have
occurred), and all Purchases hereunder shall cease immediately and (y) following
the RFA Final Payment Date, without limiting any right under this Agreement to
replace the Collection Agent, designate another Person to succeed HQ (or any
successor Collection Agent) as Collection Agent; 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 (g) of this Section 7.01,
the Facility Termination Date shall occur, HQ (if it is then serving as the
Collection Agent) shall cease to be the Collection Agent, and the Purchaser (or,
prior to the RFA Final Payment Date, the Person designated under the Financing
Agreement) shall become the Collection Agent. Upon any such declaration or
designation or upon such automatic termination, the Purchaser shall have, in
addition to the rights and remedies under this Agreement, all other rights and
remedies with respect to the Receivables provided after default under the UCC
and under other applicable law, which rights and remedies shall be cumulative.
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ARTICLE VIII
INDEMNIFICATION
SECTION 8.01. Indemnities by the Seller. Without limiting any
other rights which the Purchaser may have hereunder or under applicable law, the
Seller hereby agrees to indemnify the Purchaser and its assigns and transferees
(each, an "Indemnified Party"), from and against any and all damages, claims,
losses, liabilities and related costs and expenses, including reasonable
attorneys' fees and disbursements (all of the foregoing being collectively
referred to as "Indemnified Amounts"), awarded against or incurred by any
Indemnified Party arising out of or as a result of this Agreement or the
purchase of any Purchased Assets or in respect of any Purchased Asset,
Participated Receivable or any Contract, including, without limitation, arising
out of or as a result of:
(i) the characterization in any Seller Report or other
statement made by the Seller of any Purchased Receivable or
Participated Receivable as an Eligible Receivable which is not an
Eligible Receivable as of the date on which such information was
certified;
(ii) any representation or warranty or statement made or
deemed made by the Seller (or any of its officers) under or in
connection with this Agreement, which shall have been incorrect in any
material respect when made;
(iii) the failure by the Seller to comply with any
applicable law, rule or regulation with respect to any Purchased
Asset, Participated Receivable or the related Contract; or the failure
of any Purchased Asset, Participated Receivable or the related
Contract to conform to any such applicable law, rule or regulation;
(iv) the failure to vest in the Purchaser absolute
ownership of the Purchased Receivables and Participation Interests
that are, or that purport to be, the subject of a Purchase under this
Agreement and the Related Security and Collections in respect thereof,
free and clear of any Adverse Claim;
(v) the failure of the Seller 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 Purchased Receivables or
Participation Interests that are, or that purport to be, the subject
of a Purchase under this Agreement and the Related Security and
Collections in respect thereof, whether at the time of any Purchase 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 that is, or that purports to be, the subject of (A) a
Purchase under this Agreement, or (B) a Participation Interest
purchased under this Agreement from the Seller (including, without
limitation, a defense based on such Receivable or the related Contract
not being a legal, valid and binding
34
obligation of such Obligor enforceable against it in accordance with
its terms), or any other claim resulting from the sale of the
merchandise or services related to such Receivable or the furnishing or
failure to furnish such merchandise or services or relating to
collection activities with respect to such Receivable (if such
collection activities were performed by the Seller acting as Collection
Agent);
(vii) any failure of the Seller to perform its duties or
obligations in accordance with the provisions hereof or to perform its
duties or obligations under any Contract related to a Purchased
Receivable or Participated Receivable;
(viii) any products liability or other claim arising out of
or in connection with merchandise, insurance or services which are the
subject of any Contract related to a Purchased Receivable or
Participated Receivable;
(ix) the commingling of Collections of Purchased Assets by
the Seller (or a designee of the Seller) at any time with other funds
of the Seller or an Affiliate of the Seller;
(x) any investigation, litigation or proceeding related to
this Agreement or the use of proceeds of Purchases by the Seller or the
ownership by the Seller of Receivables, Participation Interests (and
the Government Receivables with respect thereto) the Related Security,
or Collections with respect thereto or in respect of any Receivable,
Participation Interests (and the Government Receivables with respect
thereto) Related Security or Contract;
(xi) any failure of the Seller to comply with its covenants
contained in this Agreement;
(xii) any claim brought by any Person other than an
Indemnified Party arising from any activity the Seller or any designee
of the Seller in servicing, administering or collecting any Purchased
Asset or Participated Receivable; or
(xiii) any Purchased Asset becoming (in whole or in part) a
Diluted Receivable or a Diluted Participation Interest; or
(xiv) in the case of a Contract between an Originator and a
PBM, where such PBM acts as an agent for Contract Payors rather than as
a principal, the inability of the Program Agent, as collateral assignee
pursuant to this Agreement and the other Purchase Agreements of such
Contract, to enforce any Receivable arising under such contract
directly (by contract or by operation of law) against such Contract
Payor, except to the extent such Contract Payor is a Governmental
Entity and such enforcement rights are limited by the 1972 Amendments
to the Social Security Act; or
35
(xv) the inability of the Purchaser to exercise its rights
under this Agreement to review any Contract which contains a confidentiality
provision that purports to restrict its ability to do so, or any litigation or
proceeding relating to any such confidentiality provision.
It is expressly agreed and understood by the parties hereto (i) that the
foregoing indemnification is not intended to, and shall not, constitute a
guarantee of the collectibility or payment of the Purchased Assets and (ii) that
nothing in this Section 8.01 shall require the Seller to indemnify any Person
(A) for Purchased Receivables and Participation Interests which are not
collected, not paid or uncollectible on account of the insolvency, bankruptcy,
or financial inability to pay of the applicable Obligor, (B) for damages,
losses, claims or liabilities or related costs or expenses to the extent found
in a final non-appealable judgment of a court of competent jurisdiction to have
resulted from such Person's gross negligence or willful misconduct, or (C) for
any income taxes or franchise taxes measured by income incurred by such Person
arising out of or as a result of this Agreement or in respect of any Purchased
Asset, Participated Receivable or any Contract.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or consent to any departure by the Seller therefrom
shall be effective unless in a writing signed by the Purchaser and, in the case
of any amendment, also signed by the Seller and the Collection Agent, and then
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given. No failure on the part of
the Purchaser 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 9.02. Notices, Etc. All notices and other
communications hereunder shall, unless otherwise stated herein, be in writing
and shall be delivered by hand or overnight courier service, mailed by certified
or registered mail or sent by facsimile, to each party hereto, at its address
set forth on Exhibit D hereto or at such other address as shall be designated by
such party in a written notice to the other parties hereto. All notices and
communications given to any party hereto shall be deemed to have been given on
the date of receipt.
SECTION 9.03. Binding Effect; Assignability. (a) This
Agreement shall be binding upon and inure to the benefit of the Seller, the
Purchaser, the Collection Agent and their respective successors and assigns;
provided, however, that neither the Seller nor the Collection Agent may assign
its rights or obligations hereunder or any interest herein without the prior
written consent of the Purchaser. In connection with any sale or assignment by
the Purchaser of all or a portion of the Purchased Assets, the buyer or
assignee, as the case may be, shall, to the extent of its purchase or
assignment, have all rights of the Purchaser under this Agreement (as if such
buyer or assignee, as the case may be, were the Purchaser hereunder) except to
the extent
36
specifically provided in the agreement between the Purchaser and such buyer or
assignee, as the case may be.
(b) This Agreement shall create and constitute the
continuing obligations of the parties hereto in accordance with its terms, and
shall remain in full force and effect until such time, after the Facility
Termination Date, when all of the Purchased Receivables and Participated
Receivables are either collected in full or become Defaulted Receivables;
provided, however, that rights and remedies with respect to any breach of any
representation and warranty made by the Seller pursuant to Article IV and the
provisions of Article VIII and Sections 9.04, 9.05 and 9.06 shall be continuing
and shall survive any termination of this Agreement.
SECTION 9.04. Costs, Expenses and Taxes. (a) In addition to
the rights of indemnification granted to the Purchaser pursuant to Article VIII
hereof, the Seller agrees to pay on demand all costs and expenses in connection
with the preparation, execution and delivery of this Agreement and the other
documents and agreements to be delivered hereunder, including, without
limitation, the reasonable fees and out-of-pocket expenses of counsel for the
Purchaser with respect thereto and with respect to advising the Purchaser as to
its rights and remedies under this Agreement, and the Seller agrees to pay all
costs and expenses, if any (including reasonable counsel fees and expenses), in
connection with the enforcement of this Agreement and the other documents to be
delivered hereunder excluding, however, any costs of enforcement or collection
of Purchased Assets which are not paid on account of the insolvency, bankruptcy
or financial inability to pay of the applicable Obligor.
(b) In addition, the Seller agrees to pay 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 the Seller 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 9.05. No Proceedings. Each of the Seller and the
Collection Agent hereby agrees that it will not institute against, or join any
other Person in instituting against, the Purchaser any proceeding of the type
referred to in Section 7.01(g) so long as there shall not have elapsed one year
plus one day since the later of (i) the Facility Termination Date and (ii) the
date on which all of the Purchased Receivables and Participated Receivables are
either collected in full or become Defaulted Receivables.
SECTION 9.06. Confidentiality. Unless otherwise required by
applicable law, each party hereto agrees to maintain the confidentiality of this
Agreement in communications with third parties and otherwise; provided that this
Agreement may be disclosed to (i) third parties to the extent such disclosure is
made pursuant to a written agreement of confidentiality in form and substance
reasonably satisfactory to the other party hereto, and (ii) such party's legal
counsel and auditors and the Purchaser's assignees, if they agree in each case
to hold it confidential.
37
SECTION 9.07. GOVERNING LAW. THIS AGREEMENT SHALL, IN
ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK, BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO ANY CONFLICT OF LAWS PRINCIPLES THEREOF THAT
WOULD CALL FOR THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO
THE EXTENT THAT, PURSUANT TO THE UCC OF THE STATE OF NEW YORK, THE PERFECTION
AND THE EFFECT OF PERFECTION OR NON- PERFECTION OF THE PURCHASER'S OWNERSHIP OF
OR SECURITY INTEREST IN THE RECEIVABLES ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK.
SECTION 9.08. Third Party Beneficiary. Each of the parties
hereto hereby acknowledges that the Purchaser may assign all or any portion of
its rights under this Agreement and that such assignees may (except as otherwise
agreed to by such assignees) further assign their rights under this Agreement,
and the Seller hereby consents to any such assignments. All such assignees,
including parties to the Financing Agreement in the case of assignment to such
parties, shall be third party beneficiaries of, and shall be entitled to enforce
the Purchaser's rights and remedies under, this Agreement to the same extent as
if they were parties thereto, except to the extent specifically limited under
the terms of their assignment.
SECTION 9.09. 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 9.10. Consent to Jurisdiction. (a) Each party hereto
hereby irrevocably submits to the non-exclusive jurisdiction of any New York
State or Federal court sitting in New York City in any action or proceeding
arising out of or relating to this Agreement or the other Transaction Documents,
and each party hereto hereby irrevocably agrees that all claims in respect of
such action or proceeding may be heard and determined in such New York State
court or, to the extent permitted by law, in such Federal court. The parties
hereto hereby irrevocably waive, to the fullest extent they may effectively do
so, the defense of an inconvenient forum to the maintenance of such action or
proceeding. The Seller and the Purchaser hereby irrevocably appoints CT
Corporation (the "Process Agent"), with an office on the date hereof at 111 8th
Avenue, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Xxxxxx Xxxxxx, as their agent to
receive on behalf of each of the Seller and the Purchaser and its property
service of copies of the summons and complaint and any other process which may
be served in any such action or proceeding. Such service may be made by mailing
or delivering a copy of such process to the Purchaser in care of the Process
Agent at the Process Agent's above address, and each of the Seller and the
Purchaser hereby irrevocably authorizes and directs the Process Agent to accept
such service on its behalf. The parties hereto agree that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
38
(b) Each of the parties hereto consents to the service of
any and all process in any such action or proceeding by the mailing of copies of
such process to it at its address specified in Section 9.02. Nothing in this
Section 9.10 shall affect the right of the Purchaser or its assignees to serve
legal process in any other manner permitted by law.
(c) To the extent that the Seller or the Purchaser has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service or notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, such party hereby irrevocably waives such immunity in respect
of its obligations under this Agreement or any other Transaction Document.
SECTION 9.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO,
OR CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED OR DELIVERED PURSUANT
HERETO.
SECTION 9.12. Judgment. (a) If for the purposes of obtaining
judgment in any court it is necessary to convert a sum due hereunder in U.S.
Dollars into another currency, the parties hereto agree, to the fullest extent
that they may effectively do so, that the rate of exchange used shall be that at
which in accordance with normal banking procedures the judgment creditor could
purchase U.S. Dollars with such other currency at New York, New York on the
Business Day preceding that on which final judgment is given.
(b) The obligation of any party hereto (an "Obligor
Party") in respect of any sum due from it to any other party hereto (the
"Obligee") hereunder shall, notwithstanding any judgment in a currency other
than U.S. Dollars, be discharged only to the extent that on the Business Day
following receipt by the Obligee of any sum adjudged to be so due in such other
currency, the Obligee may in accordance with normal banking procedures purchase
U.S. Dollars with such other currency; if the U.S. Dollars so purchased are less
than the sum originally due to the Obligee in U.S. Dollars, the Obligor Party
agrees, as a separate obligation and notwithstanding any such judgment, to
indemnify the Obligee against such loss, and if the U.S. Dollars so purchased
exceed the sum originally due to the Obligee in U.S. Dollars, the Obligee shall
remit to the Obligor Party such excess.
39
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.
SELLER: RITE AID FUNDING I
By:
------------------------------------------
Title:
---------------------------------------
PURCHASER: RITE AID FUNDING II
By:
------------------------------------------
Title:
---------------------------------------
Signature Page to Tertiary Purchase Agreement
---------------------------------------------
COLLECTION AGENT: RITE AID HDQTRS. FUNDING, INC.
By:
------------------------------------------
Title:
---------------------------------------
Signature Page to Tertiary Purchase Agreement
---------------------------------------------
SCHEDULE 1
Intentionally Omitted.
Sch 1-1
SCHEDULE 2
MONTHS
Fiscal Year 2004
----------------
Period Start End # of Wks
------ ----- --- --------
1 3/2/2003 3/29/2003 4
2 3/30/2003 4/26/2003 4
3 4/27/2003 5/31/2003 5
4 6/1/2003 6/28/2003 4
5 6/29/2003 7/26/2003 4
6 7/27/2003 8/30/2003 5
7 8/31/2003 9/27/2003 4
8 9/28/2003 10/25/2003 4
9 10/26/2003 11/29/2003 5
10 11/30/2003 12/27/2003 4
11 12/28/2003 1/24/2004 4
12 1/25/2004 2/28/2004 5
Sch 2-1
SCHEDULE 2
MONTHS
Fiscal Year 2005 (leap year)
----------------------------
Period Start End # of Wks
------ ----- --- --------
1 2/29/2004 3/27/2004 4
2 3/28/2004 4/24/2004 4
3 4/25/2004 5/29/2004 5
4 5/30/2004 6/26/2004 4
5 6/27/2004 7/24/2004 4
6 7/25/2004 8/28/2004 5
7 8/29/2004 9/25/2004 4
8 9/26/2004 10/23/2004 4
9 10/24/2004 11/27/2004 5
10 11/28/2004 12/25/2004 4
11 12/26/2004 1/22/2005 4
12 1/23/2005 2/26/2005 5
Sch 2-2
SCHEDULE 2
MONTHS
Fiscal Year 2006 (53 weeks)
--------------------------
Period Start End # of Wks
------ ----- --- --------
1 2/27/2005 3/26/2005 4
2 3/27/2005 4/23/2005 4
3 4/24/2005 5/28/2005 5
4 5/29/2005 6/25/2005 4
5 6/26/2005 7/23/2005 4
6 7/24/2005 8/27/2005 5
7 8/28/2005 9/24/2005 4
8 9/25/2005 10/22/2005 4
9 10/23/2005 11/26/2005 5
10 11/27/2005 12/31/2005 5
11 1/1/2006 1/28/2006 4
12 1/29/2006 3/4/2006 5
Sch 2-3
SCHEDULE 2
MONTHS
Fiscal Year 2007
----------------
Period Start End # of Wks
------ ----- --- --------
1 3/5/2006 4/1/2006 4
2 4/2/2006 4/29/2006 4
3 4/30/2006 6/3/2006 5
4 6/4/2006 7/1/2006 4
5 7/2/2006 7/29/2006 4
6 7/30/2006 9/2/2006 5
7 9/3/2006 9/30/2006 4
8 10/1/2006 10/28/2006 4
9 10/29/2006 12/2/2006 5
10 12/3/2006 12/30/2006 4
11 12/31/2006 1/27/2007 4
12 1/28/2007 3/3/2007 5
Sch 2-4
SCHEDULE 2
MONTHS
Fiscal Year 2008 (leap year)
----------------------------
Period Start End # of Wks
------ ----- --- --------
1 3/4/2007 3/31/2007 4
2 4/1/2007 4/28/2007 4
3 4/29/2007 6/2/2007 5
4 6/3/2007 6/30/2007 4
5 7/1/2007 7/28/2007 4
6 7/29/2007 9/1/2007 5
7 9/2/2007 9/29/2007 4
8 9/30/2007 10/27/2007 4
9 10/28/2007 12/1/2007 5
10 12/2/2007 12/29/2007 4
11 12/30/2007 1/26/2008 4
12 1/27/2008 3/1/2008 5
Sch 2-5
SCHEDULE 2
MONTHS
Fiscal Year 2009
----------------
Period Start End # of Wks
------ ----- --- --------
1 3/2/2008 3/29/2008 4
2 3/30/2008 4/26/2008 4
3 4/27/2008 5/31/2008 5
4 6/1/2008 6/28/2008 4
5 6/29/2008 7/26/2008 4
6 7/27/2008 8/30/2008 5
7 8/31/2008 9/27/2008 4
8 9/28/2008 10/25/2008 4
9 10/26/2008 11/29/2008 5
10 11/30/2008 12/27/2008 4
11 12/28/2008 1/24/2009 4
12 1/25/2009 2/28/2009 5
Sch 2-6
EXHIBIT A
CREDIT AND COLLECTION POLICY
A-1
EXHIBIT B
DEPOSIT BANKS, LOCK BOXES AND DEPOSIT ACCOUNTS
--------------------------------------------------------------------------------------------------------------------
DEPOSIT BANK NAME AND ADDRESS LOCK BOX (POST OFFICE DEPOSIT ACCOUNT
BOX) NUMBER NUMBER
--------------------------------------------------------------------------------------------------------------------
Mellon Bank, Pittsburgh 360321 -
--------------------------------------------------------------------------------------------------------------------
Mellon Bank - 069-3636
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
ACCOUNT BANKS AND GOVERNMENTAL ENTITY RECEIVABLES ACCOUNTS
--------------------------------------------------------------------------------------------------------------------
ACCOUNT BANK NAME AND ADDRESS LOCK BOX (POST OFFICE GOVERNMENTAL
BOX) NUMBER ENTITY RECEIVABLES
ACCOUNT NUMBER
--------------------------------------------------------------------------------------------------------------------
Mellon Bank, Philadelphia 007020 -
--------------------------------------------------------------------------------------------------------------------
Mellon Bank, Pittsburgh 371115 -
--------------------------------------------------------------------------------------------------------------------
Mellon Bank - 103-7294
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
B-1
EXHIBIT C
Intentionally Omitted
C-1
EXHIBIT D
ADDRESSES
PURCHASER: Rite Aid Funding II
00 Xxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx Sari
Facsimile No. (000) 000-0000
SELLER: Rite Aid Funding I
00 Xxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx Sari
Facsimile No. (000) 000-0000
COLLECTION AGENT: Rite Aid Hdqtrs. Funding, Inc.
00 Xxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx Sari
Facsimile No. (000) 000-0000
D-1
