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EXHIBIT 10(a)
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RECEIVABLES SALE AGREEMENT
DATED AS OF MARCH 30, 2001
AMONG
ARVINMERITOR RECEIVABLES CORPORATION,
AS THE SELLER,
ARVINMERITOR, INC.,
as the Initial Collection Agent,
ABN AMRO BANK N.V.,
AS THE AGENT,
THE LIQUIDITY PROVIDERS
FROM TIME TO TIME PARTY HERETO,
ABN AMRO BANK N.V.,
AS THE ENHANCER,
AND
AMSTERDAM FUNDING CORPORATION
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TABLE OF CONTENTS
PAGE
ARTICLE I PURCHASES FROM SELLER AND SETTLEMENTS..................................................1
Section 1.1. Sales..................................................................................1
Section 1.2. Interim Liquidations...................................................................3
Section 1.3. Selection of Discount Rates and Tranche Periods........................................3
Section 1.4. Fees and Other Costs and Expenses......................................................4
Section 1.5. Maintenance of Sold Interest; Deemed Collection........................................4
Section 1.6. Reduction in Commitments...............................................................5
Section 1.7. Repurchases............................................................................5
Section 1.8. Security Interest......................................................................6
ARTICLE II SALES TO AND FROM AMSTERDAM; ALLOCATIONS...............................................6
Section 2.1. Required Purchases from Amsterdam......................................................6
Section 2.2. Purchases by Amsterdam.................................................................7
Section 2.3. Allocations and Distributions..........................................................7
ARTICLE III ADMINISTRATION AND COLLECTIONS.........................................................9
Section 3.1. Appointment of Collection Agent........................................................9
Section 3.2. Duties of Collection Agent.............................................................9
Section 3.3. Reports...............................................................................10
Section 3.4. Lock-Box Arrangements.................................................................10
Section 3.5. Enforcement Rights....................................................................11
Section 3.6. Collection Agent Fee..................................................................11
Section 3.7. Responsibilities of the Seller........................................................11
Section 3.8. Actions by Seller.....................................................................12
Section 3.9. Indemnities by the Collection Agent...................................................12
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................13
Section 4.1. Representations and Warranties of the Seller..........................................13
Section 4.2. Representations and Warrants of the Initial Collection Agent..........................15
ARTICLE V COVENANTS.............................................................................16
Section 5.1. Covenants of the Seller...............................................................16
Section 5.2. Covenants of the Initial Collection Agent.............................................21
ARTICLE VI INDEMNIFICATION.......................................................................24
Section 6.1. Indemnities by the Seller.............................................................24
Section 6.2. Increased Cost and Reduced Return.....................................................26
Section 6.3. Other Costs and Expenses..............................................................26
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Section 6.4. Withholding Taxes.....................................................................27
Section 6.5. Payments and Allocations..............................................................27
ARTICLE VII CONDITIONS PRECEDENT..................................................................28
Section 7.1. Conditions to Closing.................................................................28
Section 7.2. Conditions to Each Purchase...........................................................28
ARTICLE VIII THE AGENT.............................................................................29
Section 8.1. Appointment and Authorization.........................................................29
Section 8.2. Delegation of Duties..................................................................29
Section 8.3. Exculpatory Provisions................................................................30
Section 8.4. Reliance by Agent.....................................................................30
Section 8.5. Assumed Payments......................................................................30
Section 8.6. Notice of Termination Events..........................................................30
Section 8.7. Non-Reliance on Agent and Other Purchasers............................................30
Section 8.8. Agent and Affiliates..................................................................31
Section 8.9. Indemnification.......................................................................31
Section 8.10. Successor Agent.......................................................................31
ARTICLE IX MISCELLANEOUS.........................................................................32
Section 9.1. Termination...........................................................................32
Section 9.2. Notices...............................................................................32
Section 9.3. Payments and Computations.............................................................32
Section 9.4. Sharing of Recoveries.................................................................33
Section 9.5. Right of Setoff.......................................................................33
Section 9.6. Amendments............................................................................33
Section 9.7. Waivers...............................................................................34
Section 9.8. Successors and Assigns; Participations; Assignments...................................34
Section 9.9. Waiver of Confidentiality.............................................................36
Section 9.10. Confidentiality of Agreement..........................................................36
Section 9.11. Agreement Not to Petition.............................................................37
Section 9.12. Excess Funds..........................................................................37
Section 9.13. No Recourse...........................................................................37
Section 9.14. Headings; Counterparts................................................................38
Section 9.15. Cumulative Rights and Severability....................................................38
Section 9.16. Governing Law; Submission to Jurisdiction.............................................38
Section 9.17. Waiver of Trial by Jury...............................................................38
Section 9.18. Intended Tax Characterization.........................................................38
Section 9.19. Entire Agreement......................................................................38
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SCHEDULES DESCRIPTION
Schedule I Definitions
Schedule II Liquidity Providers and Commitments
EXHIBITS DESCRIPTION
Exhibit A Form of Incremental Purchase Request
Exhibit B Form of Notification of Assignment from the Liquidity
Providers and the Enhancer to Amsterdam
Exhibit C Form of Periodic Report
Exhibit D Addresses and Names of Seller
Exhibit E Lock-Boxes and Lock-Box Banks
Exhibit F Form of Lock-Box Letter
Exhibit G Form of Compliance Certificate
Exhibit H Credit and Collection Policy
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RECEIVABLES SALE AGREEMENT
RECEIVABLES SALE AGREEMENT, dated as of March 30, 2001, among
ArvinMeritor Receivables Corporation, a Delaware corporation (the "Seller"),
ArvinMeritor, Inc., an Indiana corporation (the "Initial Collection Agent," and,
together with any successor thereto, the "Collection Agent"), the liquidity
providers party hereto (the "Liquidity Providers"), Amsterdam Funding
Corporation, a Delaware corporation ("Amsterdam") and ABN AMRO Bank N.V., as
provider of the Program LOC (the "Enhancer"), and ABN AMRO Bank N.V., as agent
for the Purchasers (the "Agent"). Certain capitalized terms used herein, and
certain rules of construction, are defined in Schedule I. The Liquidity
Providers and the Commitments of all Committed Purchasers are listed on Schedule
II.
The parties hereto agree as follows:
ARTICLE I
PURCHASES FROM SELLER AND SETTLEMENTS
Section 1.1. Sales. (a) The Sold Interest. Subject to the terms and
conditions hereof, the Seller may, from time to time before the Liquidity
Termination Date, sell to Amsterdam or, only if Amsterdam declines to make the
applicable purchase, ratably to the Committed Purchasers an undivided percentage
ownership interest in the Receivables, the Related Security and all related
Collections. Any such purchase (a "Purchase") shall be made by each relevant
Purchaser remitting funds to the Seller, through the Agent, pursuant to Section
1.1(c) or by the Collection Agent remitting Collections to the Seller pursuant
to Section 1.1(d). The aggregate percentage ownership interest so acquired by a
Purchaser in the Receivables, the Related Security and related Collections (its
"Purchase Interest") shall equal at any time the sum of the following
percentages:
I + PRP
---------------
ER
where:
I = the outstanding Investment of such Purchaser at
such time;
ER = the Eligible Receivables Balance at such time;
and
PRP = the Purchaser Reserve Percentage at such time.
Except during a Liquidation Period for a Purchaser, such Purchaser's Purchase
Interest will change whenever its Investment, its Purchaser Reserve Percentage
or the Eligible Receivables Balance changes. During a Liquidation Period for a
Purchaser its Purchase Interest shall remain constant at the percentage in
effect as of the day immediately preceding the commencement of
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the relevant Liquidation Period, except for redeterminations to reflect
Investment acquired from or transferred to another Purchaser under the Transfer
Agreement. The sum of all Purchasers' Purchase Interests at any time is referred
to herein as the "Sold Interest," which at any time is the aggregate percentage
ownership interest then held by the Purchasers in the Receivables, the Related
Security and Collections.
(b) Amsterdam Purchase Option and Other Purchasers' Commitments.
Subject to Section 1.1(d) concerning Reinvestment Purchases, at no time will
Amsterdam have any obligation to make a Purchase. Each Liquidity Provider and
the Enhancer (together, the "Committed Purchasers" and each, a "Committed
Purchaser") severally hereby agrees, subject to Section 7.2 and the other terms
and conditions hereof, (including, in the case of an Incremental Purchase (as
defined below), that Amsterdam has refused to make a requested Purchase), to
make Purchases before the Liquidity Termination Date, based on its Ratable Share
of each Purchase, to the extent its Investment would not thereby exceed its
Commitment, the Aggregate Investment would not thereby exceed the Purchase
Limit, and the Matured Aggregate Investment would not thereby exceed the
Aggregate Commitments. Each Purchaser's first Purchase and each additional
Purchase by such Purchaser not made from Collections pursuant to Section 1.1(d)
is referred to herein as an "Incremental Purchase." Each Purchase made by a
Purchaser with the proceeds of Collections in which it has a Purchase Interest,
which does not increase the outstanding Investment of such Purchaser, is
referred to herein as a "Reinvestment Purchase."
(c) Incremental Purchases. In order to request an Incremental Purchase
from a Purchaser, the Seller must provide to the Agent an irrevocable written
request (including by telecopier or other facsimile communication) substantially
in the form of Exhibit A, by 10:00 a.m. (Chicago time) three Business Days
before the requested date (the "Purchase Date") of such Purchase, specifying the
requested Purchase Date (which must be a Business Day) and the requested amount
(the "Purchase Amount") of such Purchase, which must be in a minimum amount of
$1,000,000 and multiples thereof (or, if less, an amount equal to the Maximum
Incremental Purchase Amount). An Incremental Purchase may only be requested from
Amsterdam unless Amsterdam, in its sole discretion, determines not to make such
Incremental Purchase. If Amsterdam determines that it will not make the
Incremental Purchase, it will give notice to the Agent two Business Days prior
to the Purchase Date. The Agent will promptly give notice to the Seller of
Amsterdam's election not to fund, in which case the Seller may request such
Incremental Purchase from the Committed Purchasers. The Agent shall promptly
notify the contents of any such request to each Purchaser from which the
Purchase is requested. If Amsterdam determines, in its sole discretion, to make
all or any portion of the requested Purchase, Amsterdam shall transfer to the
Agent's Account the Purchase Amount (or portion thereof) on the requested
Purchase Date. If Amsterdam determines, in its sole discretion, not to make all
or any portion of a requested Purchase and the Seller requests the Incremental
Purchase from the Committed Purchasers subject to Section 7.2 and the other
terms and conditions hereof, each Committed Purchaser shall transfer its Ratable
Share of that portion of the requested Purchase Amount not funded by Amsterdam
into the Agent's Account by no later than 12:00 noon (Chicago time) on the
Purchase Date (which, in the case of a Purchase that is to accrue Discount at
the Eurodollar Rate, in no event will be earlier than three Business Days after
such
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request is made to the Committed Purchasers). The Agent shall transfer to the
Seller Account the proceeds of any Incremental Purchase delivered into the
Agent's Account.
(d) Reinvestment Purchases. Unless Amsterdam has provided to the Agent,
the Seller, and the Collection Agent a notice (which notice has not been revoked
by Amsterdam) that it no longer wishes to make Reinvestment Purchases (in which
case Amsterdam's Reinvestment Purchases, but not those of the Committed
Purchasers, shall cease), on each day before the Liquidity Termination Date that
any Collections are received by the Collection Agent and no Interim Liquidation
is in effect, a Purchaser's Purchase Interest in such Collections shall
automatically be used to make a Reinvestment Purchase by such Purchaser, but
only to the extent such Reinvestment Purchase would not cause the Purchaser's
Investment to increase above the amount of such Investment at the start of the
day plus any Incremental Purchases made by the Purchaser on that day. Amsterdam
may revoke any notice provided under the first sentence of this Section 1.1(d)
by notifying the Agent, the Seller, and the Collection Agent that it will make
Reinvestment Purchases.
Section 1.2. Interim Liquidations. (a) Optional. The Seller may at any
time direct that Reinvestment Purchases cease and that an Interim Liquidation
commence for all Purchasers by giving the Agent and the Collection Agent at
least three Business Days' prior written (including telecopy or other facsimile
communication) notice specifying the date on which the Interim Liquidation shall
commence and, if desired, when such Interim Liquidation shall cease (identified
as a specific date prior to the Liquidity Termination Date or as when the
Aggregate Investment is reduced to a specified amount). If the Seller does not
so specify the date on which an Interim Liquidation shall cease, it may cause
such Interim Liquidation to cease at any time before the Liquidity Termination
Date, subject to Section 1.2(b) below, by notifying the Agent and the Collection
Agent in writing (including by telecopy or other facsimile communication) at
least three Business Days before the date on which it desires such Interim
Liquidation to cease.
(b) Mandatory. If at any time before the Liquidity Termination Date any
condition in Section 7.2 is not fulfilled, the Seller shall immediately notify
the Agent and the Collection Agent, whereupon Reinvestment Purchases shall cease
and an Interim Liquidation shall commence, which shall only cease upon the
Seller confirming to the Agent that the conditions in Section 7.2 are fulfilled.
Section 1.3. Selection of Discount Rates and Tranche Periods. (a)
Amsterdam. Amsterdam's Investment will accrue Funding Charges for each day on
which it is outstanding. On each Settlement Date the Seller shall pay to the
Agent (for the benefit of Amsterdam) an aggregate amount equal to all accrued
and unpaid Funding Charges in respect of such Investment for the immediately
preceding Discount Period. The Agent shall allocate the Investment of Amsterdam
to Tranche Periods in its sole discretion.
(b) Committed Purchasers. All Investment of the Committed Purchasers
shall be allocated to one or more Tranches reflecting the Discount Rates at
which such Investment accrues Discount and the Tranche Periods for which such
Discount Rates apply. In each request for an Incremental Purchase from the
Committed Purchasers and three Business Days before the expiration of any
Tranche Period applicable to any Committed Purchaser's Investment, the Seller
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may request the Tranche Period(s) to be applicable to such Investment and the
Discount Rate(s) applicable thereto. All Investment of the Committed Purchasers
may accrue Discount at either the Eurodollar Rate or the Prime Rate, in all
cases as established for each Tranche Period applicable to such Investment. Any
Investment of the Committed Purchasers not allocated to a Tranche Period shall
be a Prime Tranche. During the pendency of a Termination Event, the Agent may
reallocate any outstanding Investment of the Committed Purchasers to a Prime
Tranche. All Discount accrued on the Investment of the Committed Purchasers
during a Tranche Period shall be payable by the Seller on the last day of such
Tranche Period or, for a LIBOR Tranche with a Tranche Period of more than three
months, three months after the commencement, and on the last day, of such
Tranche Period. If, by the time required by this Section 1.3(b), the Seller
fails to select a Discount Rate or Tranche Period for any Investment of the
Committed Purchasers, such amount of Investment shall automatically accrue
Discount at the Prime Rate for a three Business Day Tranche Period. Any
Investment purchased from Amsterdam pursuant to the Transfer Agreement shall
accrue interest at the Prime Rate and have an initial Tranche Period of three
Business Days.
(c) If any Committed Purchaser determines (i) that maintenance of any
LIBOR Tranche would violate any applicable law or regulation, (ii) that deposits
of a type and maturity appropriate to match fund any of such Purchaser's LIBOR
Tranches are not available or (iii) that the maintenance of any LIBOR Tranche
will not adequately and fairly reflect the cost of such Purchaser of funding
LIBOR Tranches, then the Agent, upon the direction of such Purchaser, shall
suspend the availability of future LIBOR Tranches until such time as the Agent
or applicable Committed Purchaser provides notice that the circumstances giving
rise to such suspension no longer exist, and, if required by any applicable law
or regulation, terminate any outstanding, LIBOR Tranche so affected. All
Investment allocated to any such terminated LIBOR Tranche shall be reallocated
to a Prime Tranche.
Section 1.4. Fees and Other Costs and Expenses. (a) The Seller shall
pay to the Agent (i) for the ratable benefit of the Liquidity Providers, based
on their Ratable Shares, the fees set forth in the Pricing Letter and (ii) for
the account of the Agent and the Enhancer, such amounts as agreed to with the
Agent in the Fee Letter.
(b) If (i) the amount of Amsterdam's Investment is reduced (other than
as a result of a Put) on any date other than the last day of a CP Tranche, (ii)
the amount of Investment allocated to any LIBOR Tranche is reduced on any day
other than the last day of its Tranche Period or (iii) if a requested
Incremental Purchase at the Eurodollar Rate does not take place on its scheduled
Purchase Date, the Seller shall pay the Early Payment Fee to each Purchaser that
had its Investment so reduced or scheduled Purchase not made.
(c) Investment and Discount shall be payable solely from Collections
and from amounts payable under Sections 1.5, 1.7 and 6.1 (to the extent amounts
paid under Section 6.1 indemnify against reductions in or non-payment of
Receivables). The Seller shall pay, as a full recourse obligation, all other
amounts payable hereunder.
Section 1.5. Maintenance of Sold Interest; Deemed Collection. (a)
General. If at any time before the Liquidity Termination Date the Eligible
Receivables Balance is less than the sum
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of the Aggregate Investment (or, if a Termination Event exists, the Matured
Aggregate Investment) plus the Total Reserve the Seller shall immediately pay to
the Agent an amount equal to such deficiency for application to reduce the
Investments of the Purchasers ratably in accordance with the principal amount of
their respective Investments, applied first to Prime Tranches and second to the
other Tranches with the shortest remaining maturities unless otherwise specified
by the Seller. Any amount so applied to reduce Amsterdam's Investment shall be
deposited in the Special Transaction Subaccount.
(b) Deemed Collections. If on any day the outstanding balance of a
Receivable is reduced or cancelled as a result of any defective or rejected
goods or services, any cash discount or adjustment (including any adjustment
resulting from the application of any special refund or other discounts or any
reconciliation), any setoff or credit (whether such claim or credit arises out
of the same, a related, or an unrelated transaction) or other reason not arising
from the financial inability of the Obligor to pay undisputed indebtedness, the
Seller shall be deemed to have received on such day a Collection on such
Receivable in the amount of such reduction or cancellation. If on any day any
representation, warranty, covenant or other agreement of the Seller related to a
Receivable is not true or is not satisfied, the Seller shall be deemed to have
received on such day a Collection in the amount of the outstanding balance of
such Receivable. All such Collections deemed received by the Seller under this
Section 1.5(b) shall be remitted by the Seller to the Collection Agent in
accordance with Section 5.1(i).
(c) Adjustment to Sold Interest. At any time before the Liquidity
Termination Date that the Seller is deemed to have received any Collection under
Section 1.5(b) ("Deemed Collections") that derives from a Receivable that is
otherwise reported as an Eligible Receivable, so long as no Liquidation Period
then exists, the Seller may satisfy its obligations to deliver such amount to
the Collection Agent by instead notifying the Agent that the Sold Interest
should be recalculated by decreasing the Eligible Receivables Balance by the
amount of such Deemed Collections, so long as such adjustment does not cause the
Sold Interest to exceed 100%.
(d) Payment Assumption. Unless an Obligor otherwise specifies or
another application is required by contract or law, any payment received by the
Seller from any Obligor shall be applied as a Collection of Receivables of such
Obligor (starting with the oldest such Receivable) and remitted to the
Collection Agent as such.
Section 1.6. Reduction in Commitments. The Seller may, upon thirty
days' notice to the Agent, reduce the Aggregate Commitment in increments of
$1,000,000, so long as the Aggregate Commitment as so reduced is no less than
the Matured Aggregate Investment. Each such reduction in the Aggregate
Commitment shall reduce the Commitment of each Committed Purchaser in accordance
with its Ratable Share and shall reduce the Purchase Limit so that the Aggregate
Commitment remains at least 102% of the Purchase Limit and the Purchase Limit is
no less than the outstanding Aggregate Investment.
Section 1.7. Optional Repurchases. At any time that the Aggregate
Investment is less than 10% of the Aggregate Commitment in effect on the date
hereof, the Seller may, upon thirty days' notice to the Agent, repurchase the
entire Sold Interest from the Purchasers at a price equal to the outstanding
Matured Aggregate Investment and all other amounts then owed hereunder.
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Section 1.8. Security Interest. (a) The Seller hereby grants to the
Agent, for its own benefit and for the ratable benefit of the Purchasers, a
security interest in all Receivables, Related Security, Collections and Lock-Box
Accounts to secure the payment of all amounts other than Investment owing
hereunder and (to the extent of the Sold Interest) to secure the repayment of
all Investment.
(b) The Seller hereby assigns and otherwise transfers to the Agent (for
the benefit of the Agent, each Purchaser and any other Person to whom any amount
is owed hereunder), all of the Seller's right, title and interest in, to and
under the Purchase Agreement. The Seller shall execute, file and record all
financing statements, continuation statements and other documents required to
perfect or protect such assignment. This assignment includes (a) all monies due
and to become due to the Seller from the Originators under or in connection with
the Purchase Agreement (including fees, expenses, costs, indemnities and damages
for the breach of any obligation or representation related to such agreements)
and (b) all rights, remedies, powers, privileges and claims of the Seller
against the Originators under or in connection with the Purchase Agreement. All
provisions of the Purchase Agreement shall inure to the benefit of, and may be
relied upon by, the Agent, each Purchaser and each such other Person. At any
time that a Termination Event has occurred and is continuing, the Agent shall
have the sole right to enforce the Seller's rights and remedies under the
Purchase Agreement to the same extent as the Seller could absent this
assignment, but without any obligation on the part of the Agent, any Purchaser
or any other such Person to perform any of the obligations of the Seller under
the Purchase Agreement (or the promissory note executed thereunder). All amounts
distributed to the Seller under the Purchase Agreement from Receivables sold to
the Seller thereunder shall constitute Collections hereunder and shall be
applied in accordance herewith.
(c) This agreement shall be a security agreement for purposes of the
UCC. Upon the occurrence of a Termination Event, the Agent shall have all rights
and remedies provided under the UCC as in effect in all applicable
jurisdictions.
ARTICLE II
SALES TO AND FROM AMSTERDAM; ALLOCATIONS
Section 2.1. Required Purchases from Amsterdam. (a) Amsterdam may, at
any time, and on the earlier of the Amsterdam Termination Date and ten (10)
Business Days following the Agent and Amsterdam learning of a continuing
Termination Event, Amsterdam shall, sell to the Committed Purchasers pursuant to
the Transfer Agreement any percentage designated by Amsterdam of Amsterdam's
Investment and its related Amsterdam Settlement (each, a "Put").
(b) Any portion of Amsterdam's Investment and related Amsterdam
Settlement purchased by a Committed Purchaser shall be considered part of such
Purchaser's Investment and related Amsterdam Settlement from the date of the
relevant Put. Immediately upon any purchase by the Committed Purchasers of any
portion of Amsterdam's Investment, the Seller shall pay to the Agent (for the
ratable benefit of such Purchasers) an amount equal to the sum of (i) the
Assigned Amsterdam Settlement, (ii) all unpaid Discount owed to Amsterdam
(whether or
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not then due) to the end of each applicable Tranche Period to which any
Investment being Put has been allocated, (iii) all accrued but unpaid fees
(whether or not then due) payable to Amsterdam in connection herewith at the
time of such purchase and (iv) all accrued and unpaid costs, expenses and
indemnities due to Amsterdam from the Seller in connection herewith.
(c) The proceeds from each Put received by Amsterdam (other than
amounts described in clauses (iii) and (iv) of the last sentence of Section
2.1(b)), shall be transferred into the Special Transaction Subaccount and used
solely to pay that portion of the outstanding commercial paper of Amsterdam
issued to fund or maintain the Investment of Amsterdam so transferred. Until
used to pay commercial paper, all proceeds of any Put pursuant to this Section
shall be invested in Permitted Investments. All earnings on such Permitted
Investments shall be promptly remitted to the Seller.
Section 2.2. Purchases by Amsterdam. Amsterdam may at any time deliver
to the Agent and each Committed Purchaser a notification of assignment in
substantially the form of Exhibit B. If Amsterdam delivers such notice, each
Committed Purchaser shall sell to Amsterdam and Amsterdam shall purchase in full
from each Committed Purchaser, the Investment of the Committed Purchasers on the
last day of the relevant Tranche Periods, at a purchase price equal to such
Investment plus accrued and unpaid Discount thereon. Any sale from any Committed
Purchaser to Amsterdam pursuant to this Section 2.2 shall be without recourse,
representation or warranty except for the representation and warranty that the
Investment sold by such Committed Purchaser is free and clear of any Adverse
Claim created or granted by such Committed Purchaser and that such Purchaser has
not suffered a Bankruptcy Event.
Section 2.3. Allocations and Distributions. (a) Amsterdam Termination
and Non-Reinvestment Periods. Before the Liquidity Termination Date (unless an
Interim Liquidation is in effect), on each day during a period that Amsterdam
has an outstanding Investment and is not making Reinvestment Purchases (as
established under Section 1.1(d)) and at all times on and after the Amsterdam
Termination Date, the Collection Agent (i) shall set aside and hold in trust
solely for the benefit of Amsterdam (or deliver to the Agent, if so instructed
pursuant to Section 3.2(a)) Amsterdam's Purchase Interest in all Collections
received on such day and (ii) shall distribute on each Settlement Date to the
Agent (for the benefit of Amsterdam) the amounts so set aside up to the amount
of Amsterdam's Investment allocated to such Tranche Period and, to the extent
not already paid in full, all Funding Charges thereon and all other amounts then
due from the Seller in connection with such Investment. If any part of the Sold
Interest in any Collections is applied to pay any amounts that are obligations
of the Seller pursuant to Section 1.4(c) and after giving effect to such
application the Sold Interest is greater than 100%, the Seller shall pay for
distribution as part of the Sold Interest in Collections, to the Collection
Agent the amount so applied to the extent necessary so that after giving effect
to such payment the Sold Interest is no greater than 100%.
(b) Liquidity Termination Date and Interim Liquidations. On each day
during any Interim Liquidation and on each day on and after the Liquidity
Termination Date the Collection Agent shall set aside and hold in trust solely
for the account of the Agent, for the benefit of the Agent and the Purchasers,
(or deliver to the Agent, if so instructed pursuant to Section 3.2(a)) the
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Sold Interest in all Collections received on such day and such Collections shall
be allocated as follows:
(i) first, to the Collection Agent until all amounts owed to
the Collection Agent under the Agreement have been paid in full;
(ii) second, only so long as (A) the sum of the Matured Value
of Amsterdam's Investment, the Matured Value of each Liquidity
Provider's Investment, and the Enhancer's Investment is less than (B)
the product of the Sold Interest multiplied by the Eligible Receivables
Balance, to the payment of all Discount then due but not already paid
to the Enhancer;
(iii) third, to Amsterdam and to the Liquidity Providers
(ratably, based on the Matured Value of their respective Investments)
until all Investment of, and Funding Charges with respect to Amsterdam
and Discount with respect to the Liquidity Providers, as applicable,
due but not already paid to, the Liquidity Providers and Amsterdam have
been paid in full;
(iv) fourth, to the Enhancer until all Investment of, and
Discount due but not already paid to, the Enhancer has been paid in
full;
(v) fifth, to the Purchasers until all other amounts owed to
the Purchasers have been paid in full;
(vi) sixth, to the Agent until all amounts owed to the Agent
have been paid in full;
(vii) seventh, to any other Person (other than the Seller, the
Collection Agent or an Originator) to whom any amounts are owed under
the Transaction Documents until all such amounts have been paid in
full; and
(viii) eighth, to the Seller (or as otherwise required by
applicable law).
On the last day of each Tranche Period (unless otherwise instructed by the Agent
pursuant to Section 3.2(a)), the Collection Agent shall deposit into the Agent's
Account, from such set aside Collections, all amounts allocated to such Tranche
Period and all Tranche Periods that ended before such date that are due in
accordance with the priorities in clauses (ii)-(iv) above. No distributions
shall be made to pay amounts under clauses (v)-(viii) until sufficient
Collections have been set aside to pay all amounts described in clauses (iii)
and (iv) that may become payable for all outstanding Tranche Periods. All
distributions by the Agent shall be made ratably within each priority level in
accordance with the respective amounts then due each Person included in such
level unless otherwise agreed by the Agent and all Purchasers. If any part of
the Sold Interest in any Collections is applied to pay any amounts payable
hereunder that are obligations of the Seller pursuant to Section 1.4(c) and
after giving effect to such application the Sold Interest is greater than 100%,
the Seller shall pay for distribution in respect of each applicable Purchaser's
Investment as part of the Sold Interest in Collections, to the Collection
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Agent the amount so applied to the extent necessary so that after giving effect
to such payment the Sold Interest is no greater than 100%.
ARTICLE III
ADMINISTRATION AND COLLECTIONS
Section 3.1. Appointment of Collection Agent. (a) The servicing,
administering and collecting of the Receivables shall be conducted by a Person
(the "Collection Agent") designated to so act on behalf of the Purchasers under
this Article III. As the Initial Collection Agent, the Parent is hereby
designated as, and agrees to perform the duties and obligations of, the
Collection Agent. The Initial Collection Agent acknowledges that the Agent and
each Purchaser have relied on the Initial Collection Agent's agreement to act as
Collection Agent (and the agreement of any of the sub-collection agents to so
act) in making the decision to execute and deliver this Agreement and agrees
that it will not voluntarily resign as Collection Agent nor permit any
sub-collection agent to voluntarily resign as a sub-collection agent. At any
time after the occurrence and during the continuance of a Termination Event, the
Agent may designate a new Collection Agent to succeed the Initial Collection
Agent (or any successor Collection Agent).
(b) The Initial Collection Agent may, and if requested by the Agent
shall, delegate its duties and obligations as Collection Agent to an Affiliate
of the Initial Collection Agent (acting as a sub-collection agent). The Initial
Collection Agent shall delegate certain duties with respect to Receivables
originated by such respective Originator to that respective Originator pursuant
to the terms of the Letter Agreement. Notwithstanding such delegation, the
Initial Collection Agent shall remain primarily liable for the performance of
the duties and obligations so delegated, and the Agent and each Purchaser shall
have the right to look solely to the Initial Collection Agent for such
performance. The Agent may at any time remove or replace any sub-collection
agent.
(c) If replaced, the Collection Agent agrees it will terminate, and
will cause each existing sub-collection agent to terminate, its collection
activities in a manner requested by the Agent to facilitate the transition to a
new Collection Agent. The Collection Agent shall cooperate with and assist any
new Collection Agent (including providing access to, and transferring, all
Records and allowing (to the extent permitted by applicable law and contract)
the new Collection Agent to use all licenses, hardware or software necessary or
desirable to collect the Receivables). The Initial Collection Agent irrevocably
agrees to act (if requested to do so) as the data-processing agent for any new
Collection Agent (in substantially the same manner as the Initial Collection
Agent conducted such data-processing functions while it acted as the Collection
Agent).
Section 3.2. Duties of Collection Agent. (a) The Collection Agent shall
take, or cause to be taken, all action necessary or advisable to collect each
Receivable in accordance with this Agreement, the Credit and Collection Policy
and all applicable laws, rules and regulations using the skill and attention the
Collection Agent exercises in collecting other receivables or obligations owed
solely to it. The Collection Agent shall, in accordance herewith, set aside all
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Collections to which a Purchaser is entitled and pay from such Collections all
Funding Charges and Discount when due. If so instructed by the Agent, the
Collection Agent shall transfer to the Agent the amount of Collections to which
the Agent and the Purchasers are entitled by the Business Day following receipt.
Each party hereto hereby appoints the Collection Agent to enforce such Person's
rights and interests in the Receivables, but (notwithstanding any other
provision in any Transaction Document) the Agent shall at all times have the
sole right to direct the Collection Agent to commence or settle any legal action
to enforce collection of any Receivable.
(b) If no Termination Event exists and the Collection Agent determines
that such action is appropriate in order to maximize the Collections, the
Collection Agent may, in accordance with the applicable Credit and Collection
Policy, extend the maturity of any Receivable, and extend the maturity or adjust
the outstanding balance of any Defaulted Receivables as the Collection Agent may
determine to be appropriate to maximize collections thereof; provided, however,
that if a Termination Event has occurred the Collection Agent may make such
extension or adjustment only upon written approval of the Agent. Any such
extension or adjustment shall not alter the status of a Receivable as a
Defaulted Receivable, affect the computation of the Delinquency Ratio or limit
any rights of the Agent or the Purchasers hereunder. If a Termination Event
exists, the Collection Agent may make such extensions or adjustments only with
the prior consent of the Instructing Group.
(c) The Collection Agent shall turn over to the Seller (i) any
percentage of Collections in excess of the Sold Interest, less all reasonable
costs and expenses of the Collection Agent for servicing, collecting and
administering the Receivables and (ii) subject to Section 1.5(d), the
collections and records for any indebtedness owed to the Seller that is not a
Receivable. The Collection Agent shall have no obligation to remit any such
funds or records to the Seller until the Collection Agent receives evidence
(satisfactory to the Agent) that the Seller is entitled to such items. The
Collection Agent has no obligations concerning indebtedness that is not a
Receivable other than to deliver the collections and records for such
indebtedness to the Seller when required by this Section 3.2(c).
Section 3.3. Reports. On or before the twentieth day of each month, and
at such other times covering such other periods as is requested by the Agent or
the Instructing Group (which such other periods shall not be shorter than a
calendar month if no Termination Event has occurred), the Collection Agent shall
deliver to the Agent a report reflecting information as of the close of business
of the Collection Agent for the immediately preceding calendar month or such
other preceding period as is requested (each a "Periodic Report"), containing
the information described on Exhibit C (with such modifications or additional
information as requested by the Agent or the Instructing Group).
Section 3.4. Lock-Box Arrangements. The Agent is hereby authorized to
give notice at any time to any or all Lock-Box Banks that the Agent is
exercising its rights under the Lock-Box Letters and to take all actions
permitted under the Lock-Box Letters. The Seller agrees to take any action
requested by the Agent to facilitate the foregoing. After the Agent takes any
such action under the Lock-Box Letters, the Seller shall immediately deliver to
the Agent any Collections received by the Seller. If the Agent takes control of
any Lock-Box Account, the
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Agent shall distribute Collections it receives in accordance herewith and shall
deliver to the Collection Agent, for distribution under Section 3.2, all other
amounts it receives from such Lock-Box Account.
Section 3.5. Enforcement Rights. (a) The Agent may, at any time, direct
the Obligors and the Lock-Box Banks to make all payments on the Receivables
directly to the Agent or its designee. The Agent may, and the Seller shall at
the Agent's request, withhold the identity of the Purchasers from the Obligors
and Lock-Box Banks. Upon the Agent's request and only after a Potential
Termination Event, the Seller (at the Seller's expense) shall (i) give notice to
each Obligor of the Purchaser's ownership of the Sold Interest and direct that
payments on Receivables be made directly to the Agent or its designee, (ii)
assemble for the Agent all Records and collateral security for the Receivables
and the Related Security and transfer to the Agent (or its designee), or (to the
extent permitted by applicable law and contract) license to the Agent (or its
designee) the use of, all software useful to collect the Receivables and (iii)
segregate in a manner acceptable to the Agent all Collections the Seller
receives and, promptly upon receipt, remit such Collections in the form
received, duly endorsed or with duly executed instruments of transfer, to the
Agent or its designee.
(b) The Seller hereby irrevocably appoints the Agent as its
attorney-in-fact coupled with an interest, with full power of substitution and
with full authority in the place of the Seller, to take any and all steps deemed
desirable by the Agent, in the name and on behalf of the Seller to (i) collect
any amounts due under any Receivable, including endorsing the name of the Seller
on checks and other instruments representing Collections and enforcing such
Receivables and the Related Security, and (ii) exercise any and all of the
Seller's rights and remedies under the Purchase Agreement. The Agent's powers
under this Section 3.5(b) shall not subject the Agent to any liability if any
action taken by it proves to be inadequate or invalid, nor shall such powers
confer any obligation whatsoever upon the Agent.
(c) Neither the Agent nor any Purchaser shall have any obligation to
take or consent to any action to realize upon any Receivable or Related Security
or to enforce any rights or remedies related thereto.
Section 3.6. Collection Agent Fee. On or before the twentieth day of
each calendar month, the Seller shall pay to the Collection Agent a fee for the
immediately preceding calendar month as compensation for its services (the
"Collection Agent Fee") equal to (a) at all times the Initial Collection Agent
or an Affiliate of the Initial Collection Agent is the Collection Agent, the
Seller Servicing Fee, the sufficiency of which is hereby acknowledged, and (b)
at all times any other Person is the Collection Agent, the Outside Servicing
Fee. The Agent may, with the consent of the Instructing Group, pay the
Collection Agent Fee to the Collection Agent from the Sold Interest in
Collections. The Seller shall be obligated to reimburse any such payment to the
extent required by Section 1.5 or 2.3.
Section 3.7. Responsibilities of the Seller. The Seller shall pay when
due all Taxes payable in connection with the Receivables and the Related
Security or their creation or satisfaction. The Seller shall cause each
Originator to perform all of its obligations under agreements related to the
Receivables and the Related Security to the same extent as if interests
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in the Receivables and the Related Security had not been transferred hereunder
or under the Purchase Agreement. The Agent's or any Purchaser's exercise of any
rights hereunder shall not relieve the Seller or an Originator from such
obligations. Neither the Agent nor any Purchaser shall have any obligation to
perform any obligation of the Seller or an Originator or any other obligation or
liability in connection with the Receivables or the Related Security.
Section 3.8. Actions by Seller. If any goods related to a Receivable
are repossessed, the Seller agrees to resell, or to have the related Originator
or another Affiliate resell, such goods in a commercially reasonable manner for
the account of the Agent and remit, or have remitted, to the Agent the
Purchasers' share in the gross sale proceeds thereof net of any out-of-pocket
expenses and any equity of redemption of the Obligor thereon. Any such moneys
collected by the Seller or the related Originator or other Affiliate of the
Seller pursuant to this Section 3.8 shall be segregated and held in trust for
the Agent and remitted to the Agent's Account within one Business Day of receipt
as part of the Sold Interest in Collections for application as provided herein.
Section 3.9. Indemnities by the Collection Agent. Without limiting any
other rights any Person may have hereunder or under applicable law, the
Collection Agent hereby indemnifies and holds harmless the Agent and each
Purchaser and their respective officers, directors, agents and employees (each a
"Collection Agent Indemnified Party") from and against any and all damages,
losses, claims, liabilities, penalties, Taxes, costs and expenses (including
attorneys' fees and court costs) (all of the foregoing collectively, the
"Collection Agent Indemnified Losses") at any time imposed on or incurred by any
Collection Agent Indemnified Party arising out of or otherwise relating to:
(i) any representation or warranty made by, on behalf of or in
respect of, the Collection Agent in this Agreement, any other
Transaction Document, any Periodic Report or any other information or
report delivered by the Collection Agent pursuant hereto, which shall
have been false or incorrect in any material respect when made;
(ii) the failure by the Collection Agent to comply with any
applicable law, rule or regulation related to any Receivable or the
Related Security;
(iii) any loss of a perfected security interest (or in the
priority of such security interest) as a result of any commingling by
the Collection Agent of funds to which the Agent or any Purchaser is
entitled hereunder with any other funds;
(iv) the imposition of any Adverse Claim with respect to any
Receivable, Related Security or Lock-Box Account as a result of any
action taken by the Collection Agent; or
(v) any failure of the Collection Agent to perform its duties
or obligations in accordance with the provisions of this Agreement
(including, without limitation, compliance with the Credit and
Collection Policy) or any other Transaction Document to which the
Collection Agent is a party;
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whether arising by reason of the acts to be performed by the Collection Agent
hereunder or otherwise, excluding only Collection Agent Indemnified Losses to
the extent (a) a final judgment of a court of competent jurisdiction determined
that such Collection Agent Indemnified Losses resulted from gross negligence or
willful misconduct of the Collection Agent Indemnified Party seeking
indemnification, (b) solely due to the credit risk of the Obligor and for which
reimbursement would constitute recourse to the Collection Agent for uncollected
or uncollectible Receivables, or (c) such Collection Agent Indemnified Losses
include Taxes on, or measured by, the overall net income of the Agent or any
Purchaser computed in accordance with the Intended Tax Characterization;
provided, however, that nothing contained in this sentence shall limit the
liability of the Collection Agent or limit the recourse of the Agent and each
Purchaser to the Collection Agent for any amounts otherwise specifically
provided to be paid by the Collection Agent hereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1. Representations and Warranties of the Seller. The Seller
represents and warrants to the Agent and each Purchaser that:
(a) Corporate Existence and Power. The Seller is a corporation
duly organized, validly existing and in good standing under the laws of
the State of Delaware and has all corporate power and authority and all
governmental licenses, authorizations, consents and approvals required
to carry on its business in each jurisdiction in which its business is
now conducted, except where failure to obtain such license,
authorization, consent or approval would not have a material adverse
effect on (i) its ability to perform its obligations under, or the
enforceability of, any Transaction Document, (ii) its business or
financial condition, (iii) the interests of the Agent or any Purchaser
under any Transaction Document or (iv) the enforceability or
collectibility of any material portion of the Receivables.
(b) Corporate Authorization and No Contravention. The
execution, delivery and performance by the Seller of each Transaction
Document to which it is a party (i) are within its corporate powers,
(ii) have been duly authorized by all necessary corporate action, (iii)
do not contravene or constitute a default under (A) any applicable law,
rule or regulation, (B) its charter or by-laws or (C) any agreement,
order or other instrument to which it is a party or its property is
subject and (iv) will not result in any Adverse Claim on any
Receivable, the Related Security or Collections (other than the Sold
Interest) or give cause for the acceleration of any indebtedness of the
Seller.
(c) No Consent Required. No approval, authorization or other
action by, or filings with, any Governmental Authority or other Person
is required in connection with the execution, delivery and performance
by the Seller of any Transaction Document or any transaction
contemplated thereby.
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(d) Binding Effect. Each Transaction Document to which the
Seller is a party constitutes the legal, valid and binding obligation
of the Seller enforceable against it in accordance with its terms,
except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting the enforcement
of creditor's rights generally.
(e) Perfection of Ownership Interest. The Seller owns the
Receivables free of any Adverse Claim other than the interests of the
Agent and the Purchasers therein that are created hereby, and each
Purchaser shall at all times have a valid undivided percentage
ownership interest, which shall be a first priority perfected security
interest for purposes of Article 9 of the applicable Uniform Commercial
Code, in the Receivables and Collections to the extent of its Purchase
Interest then in effect.
(f) Accuracy of Information. All written information furnished
by the Seller to the Agent or any Purchaser in connection with any
Transaction Document, or any transaction contemplated thereby, is true
and accurate in all material respects as of the date of such
information or the date furnished, as applicable (and is not incomplete
by omitting any information necessary to prevent such information from
being materially misleading as of the date of such information or the
date furnished, as applicable).
(g) No Actions, Suits. There are no actions, suits or other
proceedings (including matters relating to environmental liability)
pending or threatened against or affecting the Seller or any of its
properties, that (i) if adversely determined (individually or in the
aggregate), may have a material adverse effect on the financial
condition of the Seller or on the collectibility of the Receivables or
(ii) involve any Transaction Document or any transaction contemplated
thereby. The Seller is not in default of any contractual obligation or
in violation of any order, rule or regulation of any Governmental
Authority, which default or violation may have a material adverse
effect upon (i) the financial condition of the Seller or (ii) the
collectibility of the Receivables.
(h) No Material Adverse Change. Since the date of its
formation there has been no material adverse change in the
collectibility of the Receivables or the Seller's (i) financial
condition, business, operations or prospects or (ii) ability to perform
its obligations under any Transaction Document.
(i) Accuracy of Exhibits; Lock-Box Arrangements. All
information on Exhibits D-E (listing offices of the Seller and the
Originators and where they maintain Records; and Lock-Boxes) is true
and complete, subject to any changes permitted by, and notified to the
Agent in accordance with, Article V. The Seller has not granted any
interest in any Lock-Box or Lock-Box Account to any Person other than
the Agent and, upon execution and delivery of the Lock-Box Agreements
and delivery to a Lock-Box Bank of the related Lock-Box Letter, the
Agent will have exclusive ownership and control of the Lock-Box Account
at such Lock-Box Bank.
(j) Sales by an Originator. Each sale by each Originator to
the Seller of an interest in Receivables originated by such Originator
and Collections thereof has been
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made in accordance with the terms of the Purchase Agreement, including
the payment by the Seller to such Originator of the purchase price
described in the Purchase Agreement. Each such sale has been made for
"reasonably equivalent value" (as such term is used in Section 548 of
the Bankruptcy Code) and not for or on account of "antecedent debt" (as
such term is used in Section 547 of the Bankruptcy Code) owed by such
Originator to the Seller.
Section 4.2. Representations and Warrants of the Initial Collection
Agent. The Initial Collection Agent represents and warrants to the Agent and
each Purchaser that:
(a) Corporate Existence and Power. The Initial Collection
Agent is a corporation duly organized, validly existing and in good
standing under the laws of the State of Indiana and has all corporate
power and authority and all governmental licenses, authorizations,
consents and approvals required to carry on its business in each
jurisdiction in which its business is now conducted, except where
failure to obtain such license, authorization, consent or approval
would not have a material adverse effect on (i) its ability to perform
its obligations under, or the enforceability of, any Transaction
Document, (ii) its business or financial condition, (iii) the interests
of the Agent or any Purchaser under any Transaction Document or (iv)
the enforceability or collectibility of any material portion of the
Receivables.
(b) Corporate Authorization and No Contravention. The
execution, delivery and performance by the Initial Collection Agent of
each Transaction Document to which it is a party (i) are within its
corporate powers, (ii) have been duly authorized by all necessary
corporate action, (iii) do not contravene or constitute a default under
(A) any applicable law, rule or regulation, (B) its charter or by-laws
or (C) any agreement, order or other instrument to which it is a party
or its property is subject and (iv) will not result in any Adverse
Claim on any Receivable, the Related Security or Collections other than
the Sold Interest) or give cause for the acceleration of any
indebtedness of the Initial Collection Agent.
(c) No Consent Required. No approval, authorization or other
action by, or filings with, any Governmental Authority or other Person
is required in connection with the execution, delivery and performance
by the Initial Collection Agent of any Transaction Document or any
transaction contemplated thereby.
(d) Binding Effect. Each Transaction Document to which the
Initial Collection Agent is a party constitutes the legal, valid and
binding obligation of the Initial Collection Agent enforceable against
it in accordance with its terms, except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting the enforcement of creditor's rights generally.
(e) Accuracy of Information. All written information furnished
by the Initial Collection Agent to the Agent or any Purchaser in
connection with any Transaction Document, or any transaction
contemplated thereby, is true and accurate in all material respects as
of the date of such information or the date furnished, as applicable
(and is not
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incomplete by omitting any information necessary to prevent such
information from being materially misleading as of the date of such
information or the date furnished, as applicable).
(f) No Actions, Suits. There are no actions, suits or other
proceedings (including matters relating to environmental liability)
pending or threatened against or affecting the Initial Collection
Agent, or any of its properties, that (i) if adversely determined
(individually or in the aggregate), is likely to have a material
adverse effect on the financial condition of the Initial Collection
Agent and its Subsidiaries, taken as whole, or on the collectibility of
the Receivables or (ii) involve any Transaction Document or any
transaction contemplated thereby. The Initial Collection Agent is not
in default of any contractual obligation or in violation of any order,
rule or regulation of any Governmental Authority, which default or
violation is likely to have a material adverse effect upon (i) the
financial condition of the Initial Collection Agent and its
Subsidiaries, taken as whole, or (ii) the collectibility of the
Receivables.
(g) No Material Adverse Change. Since December 31, 2000, there
has been no material adverse change in the collectibility of the
Receivables or the Initial Collection Agent's (i) financial condition,
business, operations or prospects other than as publicly disclosed
prior to the date hereof or (ii) ability to perform its obligations
under any Transaction Document.
(h) Accuracy of Exhibits; Lock-Box Arrangements. All
information on Exhibits D-E (listing offices of the Initial Collection
Agent and the Originators and where they maintain Records; and
Lock-Boxes) is true and complete, subject to any changes permitted by,
and notified to the Agent in accordance with, Article V.
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Seller. The Seller hereby covenants and
agrees to comply with the following covenants and agreements, unless the Agent
(with the consent of the Instructing Group) shall otherwise consent:
(a) Financial Reporting. The Seller will maintain a system of
accounting established and administered in accordance with GAAP and
will furnish to the Agent and each Purchaser:
(i) Annual Financial Statements. Within 120 days
after each fiscal year of the Seller copies of its annual
balance sheet (and an annual profit and loss statement),
certified by a Designated Financial Officer thereof, prepared
on a consolidated basis in conformity with GAAP;
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(ii) Quarterly Financial Statements. Within 60 days
after each (except the last) fiscal quarter of each fiscal
year of the Seller, copies of its quarterly balance sheet (and
a profit and loss statement) for the period from the beginning
of the fiscal year to the close of such quarter), certified by
a Designated Financial Officer and prepared in a manner
consistent with the financial statements described in clause
(i) of this Section 5.l(a);
(iii) Officer's Certificate. Each time financial
statements are furnished pursuant to clause (i) or (ii) of
Section 5.1(a), a compliance certificate (in substantially the
form of Exhibit G) signed by a Designated Financial Officer,
dated the date of such financial statements;
(iv) Public Reports. Promptly upon becoming
available, a copy of each report or proxy statement filed by
the Parent with the Securities and Exchange Commission or any
securities exchange; and
(v) Other Information. With reasonable promptness,
such other information (including non-financial information)
respecting the Receivables or the conditions and operations,
financial or otherwise, of the Seller and any Seller Entity as
the Agent from time to time reasonably may request in order to
protect the interests of the Agent or Committed Purchasers
under this Agreement.
(b) Notices. As soon as possible and in any event within 5
Business Days of becoming actually aware of any of the following the
Seller will notify the Agent and provide a description of:
(i) Potential Termination Events. The occurrence of
any Potential Termination Event;
(ii) Downgrading. The downgrading, withdrawal or
suspension of any rating by any rating agency of any
indebtedness of any Special Obligor or of the Parent; or
(iii) Further Information. Any other information that
the Parent is required to deliver pursuant to the Credit
Agreement at the same time the Parent delivers such
information to the required parties pursuant to the Credit
Agreement.
If the Agent receives such a notice, the Agent shall promptly give
notice thereof to each Purchaser and, until Amsterdam has no Investment
after the Amsterdam Termination Date, to each CP Dealer and each Rating
Agency.
(c) Conduct of Business. The Seller will perform all actions
necessary to remain duly incorporated, validly existing and in good
standing in its jurisdiction of incorporation and to maintain all
requisite authority to conduct its business in each jurisdiction in
which it conducts business.
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(d) Compliance with Laws. The Seller will comply with all
laws, regulations, judgments and other directions or orders imposed by
any Governmental Authority to which it or any Receivable, any Related
Security or Collection may be subject.
(e) Furnishing Information and Inspection of Records. The
Seller will furnish to the Agent and the Purchasers such information
concerning the Receivables and the Related Security as the Agent or a
Purchaser may request. The Seller will, and will cause each Originator
to, permit, at any time during regular business hours upon reasonable
notice to the Seller, the Agent or any Purchaser (or any
representatives thereof) (i) to examine and make copies of all Records,
(ii) to visit the offices and properties of the Seller and each
Originator for the purpose of examining the Records and (iii) to
discuss matters relating hereto with any of the Seller's or such
Originator's officers, directors, employees or independent public
accountants having knowledge of such matters. No more than once during
any three calendar years or any time after the occurrence of a
Termination Event, the Agent may (at the expense of the Seller) or at
any time (at the expense of the Purchasers) have an independent public
accounting firm conduct an audit of the Records or make test
verifications of the Receivables and Collections.
(f) Keeping Records. (i) The Seller will, and will cause each
Originator to, have and maintain (A) administrative and operating
procedures (including an ability to recreate Records if originals are
destroyed), (B) adequate facilities, personnel and equipment and (C)
all Records and other information necessary or advisable for collecting
the Receivables (including Records adequate to permit the immediate
identification of each new Receivable and all Collections of, and
adjustments to, each existing Receivable). The Seller will give the
Agent prior notice of any material change in such administrative and
operating procedures.
(ii) The Seller will, (A) at all times from and after the date
hereof, clearly and conspicuously xxxx its computer and master data
processing books and records with a legend describing the Agent's and
the Purchasers' interest in the Receivables and the Collections and (B)
upon the request of the Agent, so xxxx each contract relating to a
Receivable and deliver to the Agent all such contracts (including all
multiple originals of such contracts), with any appropriate endorsement
or assignment, or segregate (from all other receivables then owned or
being serviced by the Seller) the Receivables and all contracts
relating to each Receivable and hold in trust and safely keep such
contracts so legended in separate filing cabinets or other suitable
containers at such locations as the Agent may specify.
(g) Perfection. (i) The Seller will, and will cause each
Originator to, at its expense, promptly execute and deliver all
instruments and documents and take all action necessary or requested by
the Agent (including the execution and filing of financing or
continuation statements, amendments thereto or assignments thereof) to
enable the Agent to exercise and enforce all its rights hereunder and
to vest and maintain vested in the Agent a valid, first priority
perfected security interest in the Receivables, the Collections, the
Related Security, the Purchase Agreement, the Lock-Box Accounts and
proceeds thereof free and clear of any Adverse Claim other than the
Seller's interest therein (and a
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perfected ownership interest in the Receivables and Collections to the
extent of the Sold Interest). The Agent will be permitted to sign and
file any continuation statements, amendments thereto and assignments
thereof without the Seller's signature, but shall provide prompt notice
to the Seller of any such filing.
(ii) The Seller will only change its name, identity or
corporate structure or relocate its chief executive office or the
Records following notice to the Agent and the delivery to the Agent of
all financing statements, instruments and other documents (including
direction letters) requested by the Agent.
(iii) The Seller will at all times maintain its chief
executive offices within a jurisdiction in the USA (other than in the
states of Alabama, Florida, Maryland and Tennessee) in which Article 9
of the UCC is in effect. If the Seller or an Originator moves its chief
executive office to a location that imposes Taxes, fees or other
charges to perfect the Agent's and the Purchasers' interests hereunder
or the Seller's interests under the Purchase Agreement, the Seller will
pay all such amounts and any other costs and expenses incurred in order
to maintain the enforceability of the Transaction Documents, the Sold
Interest and the interests of the Agent and the Purchasers in the
Receivables, the Related Security, Collections, Purchase Agreement and
Lock-Box Accounts.
(h) Performance of Duties. The Seller will perform its duties
or obligations in accordance with the provisions of each of the
Transaction Documents. The Seller (at its expense) will (i) fully and
timely perform in all material respects all agreements required to be
observed by it in connection with each Receivable, (ii) comply in all
material respects with the Credit and Collection Policy, and (iii)
refrain from any action that may impair the rights of the Agent or the
Purchasers in the Receivables, the Related Security, Collections,
Purchase Agreement or Lock-Box Accounts.
(i) Payments on Receivables, Accounts. The Seller will, and
will cause each Originator to, at all times instruct all Obligors to
deliver payments on the Receivables (including Deemed Collections) to a
Lock-Box or Lock-Box Account. If any such payments or other Collections
are received by the Seller, it shall hold such payments in trust for
the benefit of the Agent and the Purchasers and promptly (but in any
event within two Business Days after receipt) remit such funds into a
Lock-Box Account. The Seller will cause each Lock-Box Bank to comply
with the terms of each applicable Lock-Box Letter. The Seller will not
permit the funds of any Affiliate (other than AVM Inc. during the
period from the date hereof to and including April 30, 2001) to be
deposited into any Lock-Box Account. If such funds are nevertheless
deposited into any Lock-Box Account, the Seller will promptly identify
and separate such funds for segregation. The Seller will not, and will
not permit any Collection Agent or other Person to, commingle
Collections or other funds to which the Agent or any Purchaser is
entitled with any other funds (other than funds of Affiliates of the
Seller in concentration accounts). The Seller shall only add, and shall
only permit an Originator to add, a Lock-Box Bank, Lock-Box, or
Lock-Box Account to those listed on Exhibit E if the Agent has received
notice of and has consented to such addition, a copy of any new
Lock-Box Agreement and an executed and acknowledged copy of a Lock-Box
Letter substantially in the form of Exhibit F (with
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such changes as are acceptable to the Agent) from any new Lock-Box
Bank. The Seller shall only terminate a Lock-Box Bank or Lock-Box, or
close a Lock-Box Account, upon 30 days advance notice to the Agent.
(j) Sales and Adverse Claims Relating to Receivables. Except
as otherwise provided herein, the Seller will not (by operation of law
or otherwise), dispose of or otherwise transfer, or create or suffer to
exist any Adverse Claim upon, any inventory or goods (other than in the
ordinary course of business) the sale of which may give rise to a
Receivable or any proceeds thereof.
(k) Extension or Amendment of Receivables. Except as otherwise
permitted in Section 3.2(b) and then subject to Section 1.5, the Seller
will not extend, amend, rescind or cancel any Receivable.
(l) Change in Business or Credit and Collection Policy. The
Seller will not make any change in its Credit and Collection Policy
which change would impair the collectibility of any Receivable.
(m) Accounting for Sale. Except as provided in Section 9.9,
the Seller will not, account for, or otherwise treat, the transactions
contemplated hereby other than as a sale of Receivables or inconsistent
with the Purchasers' ownership interests in the Receivables and
Collections.
(n) Certain Agreements. Except as otherwise permitted by this
Agreement, the Seller will not amend, modify, waive, revoke or
terminate any Transaction Document to which it is a party or any
provision of Seller's certificate of incorporation or by-laws.
(o) Other Business. The Seller will not: (i) engage in any
business other than the transactions contemplated by the Transaction
Documents, (ii) create, incur or permit to exist any Debt of any kind
(or cause or permit to be issued for its account any letters of credit
or bankers' acceptances) other than pursuant to this Agreement and the
Subordinated Notes, or (iii) form any Subsidiary or make any
investments in any other Person; provided, however, that the Seller
shall be permitted to incur minimal obligations to the extent necessary
for the day-to-day operations of the Seller (such as expenses for
stationery, audits, maintenance of legal status, etc.).
(p) Lock-Box Letters. Not later than April 30, 2001 the Seller
shall deliver to the Agent fully executed Lock-Box Letters with respect
to each Lock-Box set forth on Exhibit E hereto.
(q) Net Worth. The Seller shall not, as of the last day of
each calendar quarter, permit Net Worth to be less than $9,000,000.
(r) Nonconsolidation. The Seller will operate in such a manner
that the separate corporate existence of the Seller and each Seller
Entity and Affiliate thereof
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would not be disregarded in the event of the bankruptcy or insolvency
of any Seller Entity and Affiliate thereof and, without limiting the
generality of the foregoing:
(i) the Seller will not engage in any activity other
than those activities expressly permitted under the Seller's
organizational documents and the Transaction Documents, nor
will the Seller enter into any agreement other than this
Agreement, the other Transaction Documents to which it is a
party and, with the prior written consent of the Agent, any
other agreement necessary to carry out more effectively the
provisions and purposes hereof or thereof;
(ii) the Seller will cause the financial statements
and books and records of the Seller and each Seller Entity to
reflect the separate corporate existence of the Seller;
(iii) except as otherwise expressly permitted
hereunder, under the other Transaction Documents and under the
Seller's organizational documents, the Seller will not permit
any Seller Entity or Affiliate thereof to (A) pay the Seller's
expenses, (B) guarantee the Seller's obligations, or (C)
advance funds to the Seller for the payment of expenses or
otherwise; and
(iv) the Seller will not act as agent for any Seller
Entity or Affiliate, but instead will present itself to the
public as a corporation separate from each such Person and
independently engaged in the business of purchasing and
financing Receivables.
Section 5.2. Covenants of the Initial Collection Agent. The Initial
Collection Agent hereby covenants and agrees to comply with the following
covenants and agreements, unless the Agent (with the consent of the Instructing
Group) shall otherwise consent:
(a) Financial Reporting. The Initial Collection Agent will
maintain a system of accounting established and administered in
accordance with GAAP and will furnish to the Agent and each Purchaser:
(i) Annual Financial Statements. Within 120 days
after each fiscal year of the Parent copies of its annual
audited financial statements (including a consolidated balance
sheet, consolidated statement of income and retained earnings
and statement of cash flows, with related footnotes) certified
by Deloitte & Touche, LLP or another firm of independent
certified public accountants of nationally recognized standing
(which accountants shall have acknowledged the reliance of the
Agent and the Purchasers on the financial statements audited
by such accountants) and prepared on a consolidated basis in
conformity with GAAP;
(ii) Quarterly Financial Statements. Within 60 days
after each (except the last) fiscal quarter of each fiscal
year of the Parent, copies of its unaudited financial
statements (including at least a consolidated balance sheet as
of the close
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of such quarter and statements of earnings and sources and
applications of funds for the period from the beginning of the
fiscal year to the close of such quarter) certified by a
Designated Financial Officer and prepared in a manner
consistent with the financial statements described in clause
(i) of this Section 5.l(a);
(iii) Officer's Certificate. Each time financial
statements are furnished pursuant to clause (i) or (ii) of
Section 5.1(a), a compliance certificate (in substantially the
form of Exhibit G) signed by a Designated Financial Officer,
dated the date of such financial statements;
(iv) Public Reports. Promptly upon becoming
available, a copy of each report or proxy statement filed by
the Parent with the Securities and Exchange Commission or any
securities exchange; and
(v) Other Information. With reasonable promptness,
such other information (including non-financial information)
respecting the Receivables or the conditions and operations,
financial or otherwise, of the Initial Collection Agent and
any Initial Collection Agent Entity as the Agent from time to
time reasonably may request in order to protect the interests
of the Agent or Committed Purchasers under this Agreement.
(b) Notices. As soon as possible and in any event within 5
Business Days of becoming actually aware of any of the following the
Initial Collection Agent will notify the Agent and provide a
description of:
(i) Potential Termination Events. The occurrence of
any Potential Termination Event;
(ii) Downgrading. The downgrading, withdrawal or
suspension of any rating by any rating agency of any
indebtedness of any Special Obligor or of the Parent; or
(iii) Further Information. Any other information that
the Parent is required to deliver pursuant to the Credit
Agreement at the same time the Parent delivers such
information to the required parties pursuant to the Credit
Agreement.
If the Agent receives such a notice, the Agent shall promptly give
notice thereof to each Purchaser and, until Amsterdam has no Investment
after the Amsterdam Termination Date, to each CP Dealer and each Rating
Agency.
(c) Conduct of Business. The Initial Collection Agent will
perform all actions necessary to remain duly incorporated, validly
existing and in good standing in its jurisdiction of incorporation and
to maintain all requisite authority to conduct its business in each
jurisdiction in which it conducts business.
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(d) Compliance with Laws. The Initial Collection Agent will
comply with all laws, regulations, judgments and other directions or
orders imposed by any Governmental Authority to which it or any
Receivable, any Related Security or Collection may be subject.
(e) Furnishing Information and Inspection of Records. The
Initial Collection Agent will furnish to the Agent and the Purchasers
such information concerning the Receivables and the Related Security as
the Agent or a Purchaser may request. The Initial Collection Agent
will, and will cause each Originator to, permit, at any time during
regular business hours upon reasonable notice to the Initial Collection
Agent, the Agent or any Purchaser (or any representatives thereof) (i)
to examine and make copies of all Records, (ii) to visit the offices
and properties of the Initial Collection Agent and each Originator for
the purpose of examining the Records and (iii) to discuss matters
relating hereto with any of the Initial Collection Agent's or such
Originator's officers, directors, employees or independent public
accountants having knowledge of such matters. No more than once during
any three calendar years or any time after the occurrence of a
Termination Event, the Agent may (at the expense of the Initial
Collection Agent) or at any time (at the expense of the Purchasers)
have an independent public accounting firm conduct an audit of the
Records or make test verifications of the Receivables and Collections.
(f) Keeping Records. (i) The Initial Collection Agent will,
and will cause each Originator to, have and maintain (A) administrative
and operating procedures (including an ability to recreate Records if
originals are destroyed), (B) adequate facilities, personnel and
equipment and (C) all Records and other information necessary or
advisable for collecting the Receivables (including Records adequate to
permit the immediate identification of each new Receivable and all
Collections of, and adjustments to, each existing Receivable). The
Initial Collection Agent will give the Agent prior notice of any
material change in such administrative and operating procedures.
(ii) The Initial Collection Agent will, (A) at all
times from and after the date hereof, clearly and conspicuously xxxx
its computer and master data processing books and records with a legend
describing the Agent's and the Purchasers' interest in the Receivables
and the Collections and (B) upon the request of the Agent, so xxxx each
contract relating to a Receivable and deliver to the Agent all such
contracts (including all multiple originals of such contracts), with
any appropriate endorsement or assignment, or segregate (from all other
receivables then owned or being serviced by the Initial Collection
Agent) the Receivables and all contracts relating to each Receivable
and hold in trust and safely keep such contracts so legended in
separate filing cabinets or other suitable containers at such locations
as the Agent may specify.
(g) Performance of Duties. The Initial Collection Agent will
perform its duties or obligations in accordance with the provisions of
each of the Transaction Documents. The Initial Collection Agent (at its
expense) will (i) fully and timely perform in all material respects all
agreements required to be observed by it in connection with each
Receivable, (ii) comply in all material respects with the Credit and
Collection
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Policy, and (iii) refrain from any action that may impair the rights of
the Agent or the Purchasers in the Receivables, the Related Security,
Collections, Purchase Agreement or Lock-Box Accounts.
(h) Payments on Receivables, Accounts. If any payments on
Receivables or other Collections are received by the Initial Collection
Agent, it shall hold such payments in trust for the benefit of the
Agent and the Purchasers and promptly (but in any event within two
Business Days after receipt) remit such funds into a Lock-Box Account.
Except as set forth in Section 5.1(i) hereof, the Initial Collection
Agent will not permit the funds of any Affiliate to be deposited into
any Lock-Box Account. If such funds of any Affiliate or Seller Entity
are deposited into any Lock-Box Account, the Initial Collection Agent
will promptly identify and separate such funds for segregation. Except
as set forth in Section 5.1(i) hereof, the Initial Collection Agent
will not, and will not permit any other Person to, commingle
Collections or other funds to which the Agent or any Purchaser is
entitled with any other funds.
(i) Extension or Amendment of Receivables. Except as otherwise
permitted in Section 3.2(b) and then subject to Section 1.5, the
Initial Collection Agent will not extend, amend, rescind or cancel any
Receivable.
(j) Change in Business or Credit and Collection Policy. The
Initial Collection Agent will not make any change in the Originator's
Credit and Collection Policy which change would impair the
collectibility of any Receivable.
ARTICLE VI
INDEMNIFICATION
Section 6.1. Indemnities by the Seller. Without limiting any other
rights any such Person may have hereunder or under applicable law, the Seller
hereby indemnifies and holds harmless, on an after-Tax basis, the Agent and each
Purchaser and their respective officers, directors, agents and employees (each
an "Indemnified Party") from and against any and all damages, losses, claims,
liabilities, penalties, Taxes, costs and expenses (including reasonable
attorneys' fees and court costs) (all of the foregoing collectively, the
"Indemnified Losses") at any time imposed on or incurred by any Indemnified
Party arising out of or otherwise relating to any Transaction Document, the
transactions contemplated thereby or the acquisition of any portion of the Sold
Interest, any commingling of funds, any failure of a Lock-Box Bank to comply
with the terms of a Lock-Box Letter, any Receivables or Collections, or any
action taken or omitted by any of the Indemnified Parties (including any action
taken by the Agent as attorney-in-fact for the Seller pursuant to Section
3.5(b)), whether arising by reason of the acts to be performed by the Seller
hereunder or otherwise, excluding only Indemnified Losses to the extent (a) such
Indemnified Losses to the extent such losses result from gross negligence or
willful misconduct of the Indemnified Party seeking indemnification, (b) solely
due to the credit risk of the Obligor and for which reimbursement would
constitute recourse to the Seller or the Collection Agent for uncollected or
uncollectible Receivables or (c) such Indemnified Losses
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are, or include Taxes on, or measured by, the overall net income or gross
receipts of the Agent or any Purchaser computed in accordance with the Intended
Tax Characterization; provided, however, that nothing contained in this sentence
shall limit the liability of the Seller or the Collection Agent or limit the
recourse of the Agent and each Purchaser to the Seller or the Collection Agent
for any amounts otherwise specifically provided to be paid by the Seller or the
Collection Agent hereunder. Without limiting the foregoing indemnification, but
subject to the limitation set forth in clauses (a), (b) and (c) of the previous
sentence, the Seller shall indemnify the Agent and each Purchaser for
Indemnified Losses (including losses in respect of uncollectible Receivables,
regardless of whether reimbursement therefor would constitute recourse to the
Seller or the Collection Agent) relating to or resulting from:
(i) reliance on any representation or warranty made by the
Seller or Collection Agent (or any officers of the Seller or the
Collection Agent) under or in connection with this Agreement, any
Periodic Report or any other information or report delivered by the
Seller or the Collection Agent pursuant hereto, which shall have been
false or incorrect in any material respect when made or deemed made;
(ii) the failure by the Seller or any Seller Entity to comply
with any applicable law, rule or regulation with respect to any
Receivable, or the nonconformity of any Receivable with any such
applicable law, rule or regulation;
(iii) the failure of the Seller to vest and maintain vested in
the Agent, for the benefit of the Purchasers, a perfected interest in
the Sold Interest and the property conveyed pursuant to Section 1.1(a)
and Section 1.8, free and clear of any Adverse Claim;
(iv) any commingling of funds to which the Agent or any
Purchaser is entitled hereunder with any other funds;
(v) failure of any Lock Box Bank (if appointed or designated
by the Seller or if otherwise a Lock Box Bank on the date hereof) to
comply with the terms of the applicable Lock Box Letter;
(vi) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment
of any Receivable resulting from the sale or lease of goods or the
rendering of services related to such Receivable or the furnishing or
failure to furnish any such goods or services;
(vii) any failure of the Seller or any Seller Entity to
perform its duties or obligations in accordance with the provisions of
this Agreement and each of the other Transaction Documents to which it
is a party; or
(viii) any environmental liability claim, products liability
claim or personal injury or property damage suit or other similar or
related claim or action of whatever sort, arising out of or in
connection with any Receivable or any other suit, claim or action of
whatever sort relating to any of the Transaction Documents.
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Section 6.2. Increased Cost and Reduced Return. By way of
clarification, and not of limitation, of Section 6.1, if the adoption of any
applicable law, rule or regulation not in effect as of the date hereof, or any
change therein, or any change in the interpretation or administration thereof by
any Governmental Authority charged with the interpretation or administration
thereof, or compliance by any Amsterdam Funding Source, the Agent or any
Purchaser (collectively, the "Funding Parties") with any request or directive
(whether or not having the force of law) of any such Governmental Authority (a
"Regulatory Change") (a) subjects any Funding Party to any charge or withholding
on or in connection with a Funding Agreement or this Agreement (collectively,
the "Funding Documents") or any Receivable, (b) changes the basis of taxation of
payments to any of the Funding Parties of any amounts payable under any of the
Funding Documents (except for changes in the rate of Tax on the overall net
income of such Funding Party), (c) imposes, modifies or deems applicable any
reserve, assessment, insurance charge, special deposit or similar requirement
against assets of, deposits with or for the account of, or any credit extended
by, any of the Funding Parties, (d) has the effect of reducing the rate of
return on such Funding Party's capital to a level below that which such Funding
Party could have achieved but for such adoption, change or compliance (taking
into consideration such Funding Party's policies concerning capital adequacy) or
(e) imposes any other condition, and the result of any of the foregoing is (x)
to impose a cost on, or increase the cost to, any Funding Party of its
commitment under any Funding Document or of purchasing, maintaining or funding
any interest acquired under any Funding Document, (y) to reduce the amount of
any sum received or receivable by, or to reduce the rate of return of, any
Funding Party under any Funding Document or (z) to require any payment
calculated by reference to the amount of interests held or amounts received by
it hereunder, then, upon demand by the Agent, the Seller shall pay to the Agent
for the account of the Person such additional amounts as will compensate the
Agent or such Purchaser (or, in the case of Amsterdam, will enable Amsterdam to
compensate any Amsterdam Funding Source) for such increased cost or reduction.
Without limiting the foregoing, the Seller acknowledges and agrees that the fees
and other amounts payable by the Seller to the Purchasers and the Agent have
been negotiated on the basis that the unused portion of each Liquidity
Provider's Commitment is treated as a "short term commitment" for which there is
no regulatory capital requirement and the Enhancer's Commitment carries the same
capital requirement as a funded loan in the same amount. If any Liquidity
Provider determines it is required to maintain capital against its Unused
Commitment, or if the Enhancer is required to maintain capital on its Unused
Commitment (or any Purchaser is required to maintain capital against its
Investment) in excess of the amount of capital it would be required to maintain
against a funded loan in the same amount, such Purchaser shall be entitled to
compensation under this Section 6.2.
Section 6.3. Other Costs and Expenses. Also by way of clarification,
and not of limitation, of Section 6.1, the Seller shall pay to the Agent on
demand all costs and expenses in connection with (a) the preparation, execution,
delivery and administration (including amendments of any provision) of the
Transaction Documents, (b) the sale of the Sold Interest, (c) the perfection of
the Agent's rights in the Receivables and Collections, (d) the enforcement by
the Agent or the Purchasers of the obligations of the Seller under the
Transaction Documents or of any Obligor under a Receivable and (e) the
maintenance by the Agent of the Lock-Boxes and Lock-Box Accounts, including
fees, costs and expenses of legal counsel for the Agent and Amsterdam relating
to any of the foregoing or to advising the Agent, Amsterdam and any Amsterdam
Funding Source about its rights and remedies under any Transaction Document or
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any related Funding Agreement and all costs and expenses (including counsel fees
and expenses) of the Agent, each Purchaser and each Amsterdam Funding Source in
connection with the enforcement of the Transaction Documents or any Funding
Agreement and in connection with the administration of the Transaction Documents
following a Termination Event. The Seller shall reimburse the Agent and
Amsterdam for the cost of the Agent's or Amsterdam's auditors (which may be
employees of such Person) auditing the books, records and procedures of the
Seller. The Seller shall reimburse Amsterdam for any amounts Amsterdam must pay
to any Committed Purchaser pursuant to the Transfer Agreement, this Agreement
and the Funding Agreements related thereto on account of any Tax. The Seller
shall reimburse Amsterdam on demand for all other costs and expenses incurred by
Amsterdam or any shareholder of Amsterdam in connection with the Transaction
Documents or the transactions contemplated thereby, including the cost of
auditing Amsterdam's books by certified public accountants, the cost of the
Ratings and the fees and out-of-pocket expenses of counsel of the Agent,
Amsterdam or any shareholder, or administrator, of Amsterdam for advice relating
to Amsterdam's operation.
Section 6.4. Withholding Taxes. (a) All payments made by the Seller
hereunder shall be made without withholding for or on account of any present or
future taxes (other than overall net income taxes on the recipient). If any such
withholding is so required, the Seller shall make the withholding, pay the
amount withheld to the appropriate authority before penalties attach thereto or
interest accrues thereon and pay such additional amount as may be necessary to
ensure that the net amount actually received by each Purchaser and the Agent
free and clear of such taxes (including such taxes on such additional amount) is
equal to the amount that Purchaser or the Agent (as the case may be) would have
received had such withholding not been made. If the Agent or any Purchaser pays
any such taxes, penalties or interest the Seller shall reimburse the Agent or
such Purchaser for that payment on demand. If the Seller pays any such taxes,
penalties or interest, it shall deliver official tax receipts evidencing that
payment or certified copies thereof to the Purchaser or Agent on whose account
such withholding was made (with a copy to the Agent if not the recipient of the
original) on or before the thirtieth day after payment.
(b) Before the first date on which any amount is payable hereunder for
the account of any Purchaser not incorporated under the laws of the USA such
Purchaser shall deliver to the Seller and the Agent each two (2) duly completed
copies of United States Internal Revenue Service Form W-8BEN or W-8ECI (or
successor applicable form) certifying that such Purchaser is entitled to receive
payments hereunder without deduction or withholding of any United States federal
income taxes. Each such Purchaser shall replace or update such forms when
necessary to maintain any applicable exemption and as requested by the Agent or
the Seller.
Section 6.5. Payments and Allocations. If any Person seeks compensation
pursuant to this Article VI, such Person shall deliver to the Seller and the
Agent a certificate setting forth the amount due to such Person, a description
of the circumstance giving rise thereto and the basis of the calculations of
such amount, which certificate shall be conclusive absent manifest error. The
Seller shall pay to the Agent (for the account of such Person) the amount shown
as due on any such certificate within thirty (30) days after receipt of the
notice.
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ARTICLE VII
CONDITIONS PRECEDENT
Section 7.1. Conditions to Closing. This Agreement shall become
effective on the first date all conditions in this Section 7.1 are satisfied. On
or before such date, the Seller (or, in the case of Section 7.1(e)(ii), the
Enhancer and the applicable Liquidity Providers) shall deliver to the Agent the
following documents in form, substance and quantity acceptable to the Agent:
(a) A certificate of the Secretary of the Seller and each
Seller Entity certifying (i) the resolutions of the Seller's and each
Seller Entity's board of directors approving each Transaction Document
to which it is a party, (ii) the name, signature, and authority of each
officer who executes on the Seller's or each Seller Entity's behalf a
Transaction Document (on which certificate the Agent and each Purchaser
may conclusively rely until a revised certificate is received), (iii)
the Seller's and each Seller Entity's certificate or articles of
incorporation or limited liability company agreement, as applicable,
certified by the Secretary or Assistant Secretary of such entity, (iv)
a copy of the Seller's and each Seller Entity's by-laws and (v) good
standing certificates issued by the Secretaries of State of each
jurisdiction where the Seller and each Seller Entity is organized.
(b) All instruments and other documents required, or deemed
desirable by the Agent, to perfect the Agent's first priority interest
in the Receivables, Collections, the Purchase Agreement and the
Lock-Box Accounts in all appropriate jurisdictions.
(c) UCC search reports from all jurisdictions the Agent
requests.
(d) Executed copies of (i) all consents and authorizations
necessary in connection with the Transaction Documents (ii) direction
letters executed by the Seller authorizing the Agent to inspect and
make copies from the Seller's books and records maintained at any
off-site data processing or storage facilities, (iii) a Periodic Report
covering the month ended February 20, 2001, and (iv) each Transaction
Document.
(e) Favorable opinions of counsel to the Seller and each
Seller Entity (and, if requested by Amsterdam, the Enhancer or any
Liquidity Provider and then at the expense of the Seller) covering such
matters as Amsterdam or the Agent may request.
(f) Such other approvals, opinions or documents as the Agent
or Amsterdam may reasonably request.
Section 7.2. Conditions to Each Purchase. The obligation of each
Committed Purchaser to make any Purchase, and the right of the Seller to request
or accept any Purchase, are subject to the conditions (and each Purchase shall
evidence the Seller's representation and warranty that clauses (a)-(d) of this
Section 7.2 have been satisfied) that on the date of such Purchase before and
after giving effect to the Purchase:
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(a) no Potential Termination Event shall then exist or shall
occur as a result of the Purchase;
(b) the Liquidity Termination Date has not occurred and,
after giving effect to the application of the proceeds of such
Purchase, the outstanding Matured Aggregate Investment would not exceed
the Aggregate Commitment;
(c) the representations and warranties of the Seller, each
Originator and the Collection Agent contained herein or in any other
Transaction Document are true and correct in all material respects on
and as of such date (except to the extent such representations and
warranties relate solely to an earlier date and then as of such earlier
date);
(d) each of the Seller and each Seller Entity is in full
compliance with the Transaction Documents to which it is a party
(including all covenants and agreements in Article V); and
(e) all legal matters related to the Purchase are reasonably
satisfactory to the Purchasers.
Nothing in this Section 7.2 limits the obligations (including those in Section
2.1) of each Committed Purchaser to Amsterdam (including the Transfer
Agreement).
ARTICLE VIII
THE AGENT
Section 8.1. Appointment and Authorization. Each Purchaser hereby
irrevocably designates and appoints ABN AMRO Bank N.V. as the "Agent" under the
Transaction Documents and authorizes the Agent to take such actions and to
exercise such powers as are delegated to the Agent hereby and to exercise such
other powers as are reasonably incidental thereto. The Agent shall hold, in its
name, for the benefit of each Purchaser, the Purchase Interest of the Purchaser.
The Agent shall not have any duties other than those expressly set forth in the
Transaction Documents or any fiduciary relationship with any Purchaser, and no
implied obligations or liabilities shall be read into any Transaction Document,
or otherwise exist, against the Agent. The Agent does not assume, nor shall it
be deemed to have assumed, any obligation to, or relationship of trust or agency
with, the Seller. Notwithstanding any provision of this Agreement or any other
Transaction Document, in no event shall the Agent ever be required to take any
action which exposes the Agent to personal liability or which is contrary to the
provision of any Transaction Document or applicable law.
Section 8.2. Delegation of Duties. The Agent may execute any of its
duties through agents or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.
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Section 8.3. Exculpatory Provisions. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted (i) with the consent or at the direction of the Instructing Group or
(ii) in the absence of such Persons gross negligence or willful misconduct. The
Agent shall not be responsible to any Purchaser or other Person for any
recitals, representations, warranties or other statements made by the Seller,
any Seller Entity or any of its Affiliates, (ii) the value, validity,
effectiveness, genuineness, enforceability or sufficiency of any Transaction
Document, (iii) any failure of the Seller, and Seller Entity or any of its
Affiliates to perform any obligation or (iv) the satisfaction of any condition
specified in Article VII. The Agent shall not have any obligation to any
Purchaser to ascertain or inquire about the observance or performance of any
agreement contained in any Transaction Document or to inspect the properties,
books or records of the Seller, any Seller Entity or any of its Affiliates.
Section 8.4. Reliance by Agent. The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any document,
other writing or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person and upon advice and
statements of legal counsel (including counsel to the Seller), independent
accountants and other experts selected by the Agent. The Agent shall in all
cases be fully justified in failing or refusing to take any action under any
Transaction Document unless it shall first receive such advice or concurrence of
the Purchasers, and assurance of its indemnification, as it deems appropriate.
Section 8.5. Assumed Payments. Unless the Agent shall have received
notice from the applicable Purchaser before the date of any Incremental Purchase
that such Purchaser will not make available to the Agent the amount it is
scheduled to remit as part of such Incremental Purchase the Agent may assume
such Purchaser has made such amount available to the Agent when due (an "Assumed
Payment") and, in reliance upon such assumption, the Agent may (but shall have
no obligation to) make available such amount to the appropriate Person. If and
to the extent that any Purchaser shall not have made its Assumed Payment
available to the Agent, such Purchaser and the Seller) hereby agrees to pay the
Agent forthwith on demand such unpaid portion of such Assumed Payment up to the
amount of funds actually paid by the Agent, together with interest thereon for
each day from the date of such payment by the Agent until the date the requisite
amount is repaid to the Agent, at a rate per annum equal to the Federal Funds
Rate plus 2%.
Section 8.6. Notice of Termination Events. The Agent shall not be
deemed to have knowledge or notice of the occurrence of any Potential
Termination Event unless the Agent has received notice from any Purchaser or the
Seller stating that a Potential Termination Event has occurred hereunder and
describing such Potential Termination Event. The Agent shall take such action
concerning a Potential Termination Event as may be directed by the Instructing
Group (or, if required for such action, all of the Purchasers), but until the
Agent receives such directions, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, as the Agent deems
advisable and in the best interests of the Purchasers.
Section 8.7. Non-Reliance on Agent and Other Purchasers. Each Purchaser
expressly acknowledges that neither the Agent nor any of its officers,
directors, employees, agents,
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attorneys-in-fact or Affiliates has made any representations or warranties to it
and that no act by the Agent hereafter taken, including any review of the
affairs of the Seller or any Seller Entity, shall be deemed to constitute any
representation or warranty by the Agent. Each Purchaser represents and warrants
to the Agent that, independently and without reliance upon the Agent or any
other Purchaser and based on such documents and information as it has deemed
appropriate, it has made and will continue to make its own appraisal of and
investigation into the business, operations, property, prospects, financial and
other conditions and creditworthiness of the Seller, the Seller Entities and the
Receivables and its own decision to enter into this Agreement and to take, or
omit, action under any Transaction Document. The Agent shall deliver each month
to any Purchaser that so requests a copy of the Periodic Report(s) received
covering the preceding calendar month. Except for items specifically required to
be delivered hereunder, the Agent shall not have any duty or responsibility to
provide any Purchaser with any information concerning the Seller, any Seller
Entity or any of its Affiliates that comes into the possession of the Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
Section 8.8. Agent and Affiliates. The Agent and its Affiliates may
extend credit to, accept deposits from and generally engage in any kind of
business with the Seller, any Seller Entity or any of their Affiliates and, in
its roles as a Liquidity Provider and the Enhancer, ABN AMRO may exercise or
refrain from exercising its rights and powers as if it were not the Agent. The
parties acknowledge that ABN AMRO acts as agent for Amsterdam and subagent for
Amsterdam's management company in various capacities, as well as providing
credit facilities and other support for Amsterdam not contained in the
Transaction Documents.
Section 8.9. Indemnification. Each Committed Purchaser shall indemnify
and hold harmless the Agent and its officers, directors, employees,
representatives and agents (to the extent not reimbursed by the Seller or any
Seller Entity and without limiting the obligation of the Seller or any Seller
Entity to do so), ratably in accordance with its Ratable Share from and against
any and all liabilities, obligations, losses, damages, penalties, judgments,
settlements, costs, expenses and disbursements of any kind whatsoever (including
in connection with any investigative or threatened proceeding, whether or not
the Agent or such Person shall be designated a party thereto) that may at any
time be imposed on, incurred by or asserted against the Agent or such Person as
a result of or related to, any of the transactions contemplated by the
Transaction Documents or the execution, delivery or performance of the
Transaction Documents or any other document furnished in connection therewith
(but excluding any such liabilities, obligations, losses, damages, penalties,
judgments, settlements, costs, expenses or disbursements resulting solely from
the gross negligence or willful misconduct of the Agent or such Person as
finally determined by a court of competent jurisdiction).
Section 8.10. Successor Agent. The Agent may, upon at least five (5)
days notice to the Seller and each Purchaser, resign as Agent. Such resignation
shall not become effective until a successor agent is appointed by an
Instructing Group and has accepted such appointment. Upon such acceptance of its
appointment as Agent hereunder by a successor Agent, such successor Agent shall
succeed to and become vested with all the rights and duties of the retiring
Agent, and the retiring Agent shall be discharged from its duties and
obligations under the Transaction Documents. After any retiring Agent's
resignation hereunder, the provisions of Article VI and
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this Article VIII shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was the Agent.
ARTICLE IX
MISCELLANEOUS
Section 9.1. Termination. Amsterdam shall cease to be a party hereto
when the Amsterdam Termination Date has occurred, Amsterdam holds no Investment
and all amounts payable to it hereunder have been indefeasibly paid in full.
This Agreement shall terminate following the Liquidity Termination Date when no
Investment is held by a Purchaser and all other amounts payable hereunder have
been indefeasibly paid in full, but the rights and remedies of the Agent and
each Purchaser concerning any representation, warranty or covenant made, or
deemed to be made, by the Seller, and under Article VI and Section 8.9, shall
survive such termination.
Section 9.2. Notices. Unless otherwise specified, all notices and other
communications hereunder shall be in writing (including by telecopier or other
facsimile communication), given to the appropriate Person at its address or
telecopy number set forth on the signature pages hereof or at such other address
or telecopy number as such Person may specify, and effective when received at
the address specified by such Person. Each party hereto, however, authorizes the
Agent to act on telephone notices of Purchases and Discount Rate and Tranche
Period selections from any person the Agent in good faith believes to be acting
on behalf of the relevant party and, at the Agent's option, to tape record any
such telephone conversation. Each party hereto agrees to deliver promptly to the
Agent a confirmation of each telephone notice given or received by such party
(signed by an authorized officer of such party), but the absence of such
confirmation shall not affect the validity of the telephone notice. The Agent's
records of all such conversations shall be deemed correct and, if the
confirmation of a conversation differs in any material respect from the action
taken by the Agent, the records of the Agent shall govern absent manifest error.
The number of days for any advance notice required hereunder may be waived
(orally or in writing) by the Person receiving such notice and, in the case of
notices to the Agent, the consent of each Person to which the Agent is required
to forward such notice.
Section 9.3. Payments and Computations. Notwithstanding anything herein
to the contrary, any amounts to be paid or transferred by the Seller or the
Collection Agent to, or for the benefit of, any Purchaser, or any other Person
shall be paid or transferred to the Agent (for the benefit of such Purchaser or
other Person). The Agent shall promptly (and, if reasonably practicable, on the
day it receives such amounts) forward each such amount to the Person entitled
thereto and such Person shall apply the amount in accordance herewith. All
amounts to be paid or deposited hereunder shall be paid or transferred on the
day when due in immediately available Dollars (and, if due from the Seller or
Collection Agent, by 11:00 a.m. (Chicago time), with amounts received after such
time being deemed paid on the Business Day following such receipt). The Seller
hereby authorizes the Agent to debit the Seller Account for application to any
amounts owed by the Seller hereunder. The Seller shall, to the extent permitted
by law, pay to the Agent upon demand, for the account of the applicable Person,
interest on all amounts not
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paid or transferred by the Seller or the Collection Agent when due hereunder at
a rate equal to the Prime Rate plus 1%, calculated from the date any such amount
became due until the date paid in full. Any payment or other transfer of funds
scheduled to be made on a day that is not a Business Day shall be made on the
next Business Day, and any Discount Rate or interest rate accruing on such
amount to be paid or transferred shall continue to accrue to such next Business
Day. All computations of interest, fees, Discount and Funding Charges shall be
calculated for the actual days elapsed based on a 360 day year.
Section 9.4. Sharing of Recoveries. Each Purchaser agrees that if it
receives any recovery, through set-off, judicial action or otherwise, on any
amount payable or recoverable hereunder in a greater proportion than should have
been received hereunder or otherwise inconsistent with the provisions hereof,
then the recipient of such recovery shall purchase for cash an interest in
amounts owing to the other Purchasers (as return of Investment or otherwise),
without representation or warranty except for the representation and warranty
that such interest is being sold by each such other Purchaser free and clear of
any Adverse Claim created or granted by such other Purchaser, in the amount
necessary to create proportional participation by the Purchasers in such
recovery (as if such recovery were distributed pursuant to Section 2.3). If all
or any portion of such amount is thereafter recovered from the recipient, such
purchase shall be rescinded and the purchase price restored to the extent of
such recovery, but without interest.
Section 9.5. Right of Setoff. During a Termination Event, each
Purchaser is hereby authorized (in addition to any other rights it may have) to
setoff, appropriate and apply (without presentment, demand, protest or other
notice which are hereby expressly waived) any deposits and any other
indebtedness held or owing by such Purchaser (including by any branches or
agencies of such Purchaser) to, or for the account of, the Seller against
amounts owing by the Seller hereunder (even if contingent or unmatured).
Section 9.6. Amendments. Except as otherwise expressly provided herein,
no amendment or waiver hereof shall be effective unless signed by the Seller and
the Instructing Group. In addition, no amendment of any Transaction Document
shall, without the consent of (a) all the Liquidity Providers, (i) extend the
Liquidity Termination Date or the date of any payment or transfer of Collections
by the Seller to the Collection Agent or by the Collection Agent to the Agent,
(ii) reduce the rate or extend the time of payment of Discount for any
Eurodollar Tranche or Prime Tranche, (iii) reduce or extend the time of payment
of any fee payable to the Liquidity Providers, (iv) except as provided herein,
release, transfer or modify any Committed Purchaser's Purchase Interest or
change any Commitment, (v) amend the definition of Required Liquidity Providers,
Instructing Group, Termination Event or Section 1.1, 1.2, 1.5, 1.7(a), 2.1, 2.2,
2.3, 6.1, 6.2, 6.3, 7.2 or 9.6, Section 2.1 of the Transfer Agreement or any
provision of the Limited Guaranty, (vi) consent to the assignment or transfer by
the Seller or any Originator of any interest in the Receivables other than
transfers hereunder, or (vii) amend any defined term relevant to the
restrictions in clauses (i) through (vi) in a manner which would circumvent the
intention of such restrictions or (b) the Agent, amend any provision hereof if
the effect thereof is to affect the indemnities to, or the rights or duties of,
the Agent or to reduce any fee payable for the Agent's own account.
Notwithstanding the foregoing, the amount of any fee or other payment due and
payable from the Seller to the Agent (for its own account), Amsterdam or the
Enhancer may be changed or otherwise adjusted solely with the consent of the
Seller and
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the party to which such payment is payable. Any amendment hereof shall apply to
each Purchaser equally and shall be binding upon the Seller, the Purchasers and
the Agent.
Section 9.7. Waivers. No failure or delay of the Agent or any Purchaser
in exercising any power, right, privilege or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right, privilege or remedy preclude any other or further exercise thereof or the
exercise of any other power, right, privilege or remedy. Any waiver hereof shall
be effective only in the specific instance and for the specific purpose for
which such waiver was given. After any waiver, the Seller, the Purchasers and
the Agent shall be restored to their former position and rights and any
Potential Termination Event waived shall be deemed to be cured and not
continuing, but no such waiver shall extend to (or impair any right consequent
upon) any subsequent or other Potential Termination Event. Any additional
Discount that has accrued after a Termination Event before the execution of a
waiver thereof, solely as a result of the occurrence of such Termination Event,
may be waived by the Agent at the direction of the Purchaser entitled thereto
or, in the case of Discount owing to the Liquidity Providers, of the Required
Liquidity Providers.
Section 9.8. Successors and Assigns; Participations; Assignments. (a)
Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
Except as otherwise provided herein, the Seller may not assign or transfer any
of its rights or delegate any of its duties without the prior consent of the
Agent and the Purchasers.
(b) Participations. Any Purchaser may sell to one or more Persons
affiliated with the Purchaser without the prior consent of the Seller, and to
one or more other Persons with the prior consent of the Seller (which consent
shall not be unreasonably withheld) (each a "Participant") participating
interests in the interests of such Purchaser hereunder and under the Transfer
Agreement. Such Purchaser shall remain solely responsible for performing its
obligations hereunder, and the Seller and the Agent shall continue to deal
solely and directly with such Purchaser in connection with such Purchaser's
rights and obligations hereunder and under the Transfer Agreement. Each
Participant shall be entitled to the benefits of Article VI and shall have the
right of setoff through its participation in amounts owing hereunder and under
the Transfer Agreement to the same extent as if it were a Purchaser hereunder
and under the Transfer Agreement, which right of setoff is subject to such
Participant's obligation to share with the Purchasers as provided in Section
9.4. A Purchaser shall not agree with a Participant to restrict such Purchaser's
right to agree to any amendment hereto or to the Transfer Agreement, except
amendments described in clause (a) of Section 9.6.
(c) Assignments by Liquidity Providers. Any Liquidity Provider may
assign to one or more Persons ("Purchasing Liquidity Providers"), acceptable to
the Agent in its sole discretion, and, so long as no Potential Termination Event
has occurred and is continuing, with the consent of the Seller which shall not
be unreasonably withheld, any portion of its Commitment as a Liquidity Provider
hereunder and under the Transfer Agreement and Purchase Interest pursuant to a
supplement hereto and to the Transfer Agreement (a "Transfer Supplement") in
form satisfactory to the Agent executed by each such Purchasing Liquidity
Provider, such selling Liquidity Provider and the Agent. Any such assignment by
a Liquidity Provider must be for an
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amount of at least Five Million Dollars. Each Purchasing Liquidity Provider
shall pay a fee of Three Thousand Dollars to the Agent. Any partial assignment
shall be an assignment of an identical percentage of such selling Liquidity
Provider's Investment and its Commitment as a Liquidity Provider hereunder and
under the Transfer Agreement. Upon the execution and delivery to the Agent of
the Transfer Supplement, delivery to the Seller and the Agent of the forms
identified in Section 6.4(b) hereof duly executed by such Purchasing Liquidity
Provider and payment by the Purchasing Liquidity Provider to the selling
Liquidity Provider of the agreed purchase price, such selling Liquidity Provider
shall be released from its obligations hereunder and under the Transfer
Agreement to the extent of such assignment and such Purchasing Liquidity
Provider shall for all purposes be a Liquidity Provider party hereto and shall
have all the rights and obligations of a Liquidity Provider hereunder to the
same extent as if it were an original party hereto and to the Transfer Agreement
with a Commitment as a Liquidity Provider, any Investment and any related
Assigned Amsterdam Settlement described in the Transfer Supplement.
(d) Replaceable Liquidity Providers. If any Liquidity Provider (a
"Replaceable Liquidity Provider") shall (i) petition the Seller for any amounts
under Section 6.2 or 6.4 (ii) cease to have a short-term debt rating of "A-1" by
S&P and "P-1" by Xxxxx'x (unless such Liquidity Provider is also the Enhancer),
the Seller or Amsterdam may designate a replacement financial institution (a
"Replacement Liquidity Provider") acceptable to the Agent, in its sole
discretion, to which such Replaceable Liquidity Provider shall, subject to its
receipt of an amount equal to its Investment, any related Assigned Amsterdam
Settlement, and accrued Discount and fees thereon (plus, from the Seller, any
Early Payment Fee that would have been payable if such transferred Investment
had been paid on such date) and all amounts payable under Section 6.2, promptly
assign all of its rights, obligations and Liquidity Provider Commitment
hereunder and under the Transfer Agreement, together with all of its Purchase
Interest, and any related Assigned Amsterdam Settlement, to the Replacement
Liquidity Provider in accordance with Section 9.8(c).
(e) Assignment by Amsterdam. Each party hereto agrees and consents (i)
to Amsterdam's assignment, participation, grant of security interests in or
other transfers of any portion of, or any of its beneficial interest in, the
Amsterdam Purchase Interest and the Amsterdam Settlement and (ii) to the
complete assignment by Amsterdam of all of its rights and obligations hereunder
to ABN AMRO or any other Person, and upon such assignment Amsterdam shall be
released from all obligations and duties hereunder; provided, however, that
Amsterdam may not, without the prior consent of the Required Liquidity Providers
and the Enhancer, transfer any of its rights under the Transfer Agreement to
cause the Liquidity Providers or the Enhancer to purchase the Amsterdam Purchase
Interest and the Amsterdam Settlement unless the assignee (i) is a corporation
whose principal business is the purchase of assets similar to the Receivables,
(ii) has ABN AMRO as its administrative agent and (iii) issues commercial paper
with credit ratings substantially comparable to the Ratings. Amsterdam shall
promptly notify each party hereto of any such assignment. Upon such an
assignment of any portion of Amsterdam's Purchase Interest and the Amsterdam
Settlement, the assignee shall have all of the rights of Amsterdam hereunder
relate to such Amsterdam Purchase Interest and Amsterdam Settlement.
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(f) Opinions of Counsel. If required by the Agent or to maintain the
Ratings, each Transfer Supplement must be accompanied by an opinion of counsel
of the assignee as to such matters as the Agent may reasonably request.
Section 9.9. Waiver of Confidentiality. The Seller hereby consents to
the disclosure of any nonpublic information relating thereto among the Agent and
the Purchasers and by the Agent or the Purchasers to (i) any officers,
directors, members, managers, employees or outside accountants, auditors or
attorneys thereof, (ii) any prospective or actual assignee or participant, (iii)
any rating agency, surety, guarantor or credit or liquidity enhancer to the
Agent or any Purchaser, (iv) any entity organized to purchase, or make loans
secured by, financial assets for which ABN AMRO provides managerial services or
acts as an administrative agent, (v) Amsterdam's administrator, management
company, referral agents, issuing agents or depositaries or CP Dealers and (vi)
Governmental Authorities with appropriate jurisdiction.
Section 9.10. Confidentiality of Agreement. (a) Unless otherwise
required by applicable law, order of any court or administrative agency, or
otherwise by any governmental authority, the Seller agrees to maintain the
confidentiality of the Transaction Documents (and all drafts thereof) in its
communications with third parties and otherwise; provided, however, that the
Transaction Documents may be disclosed to third parties to the extent such
disclosure is (i) required in connection with a sale of receivables of Seller,
(ii) made solely to Persons who are legal counsel for the Purchaser of such
receivables, and (iii) made pursuant to a written agreement of confidentiality
in form and substance reasonably satisfactory to the Agent; provided further,
however, that the Transaction Documents may be disclosed to the Seller's legal
counsel and independent auditors; and provided further, however, that neither
the Seller nor the Servicer have any obligation of confidentiality in respect of
any information which may be generally available to the public or becomes
available to the public through no fault of the Seller or the Servicer.
(b) Unless otherwise required by applicable law, order of any court or
administrative agency, or otherwise by any governmental authority, the Agent
agrees to maintain the confidentiality, in its communications with third parties
and otherwise, of any information regarding the Seller obtained in connection
with the Transaction Documents which has been identified by the Seller to the
Agent as confidential in nature (the "Confidential Material"); provided,
however, that the Confidential Material may be disclosed to third parties to the
extent such disclosure is (i) to a rating agency, (ii) required in connection
with the exercise of any remedy hereunder or under any related documents,
instruments and agreements, or (iii) to any actual or proposed participant or
assignee of all or part of its rights hereunder, or an actual or proposed
liquidity or enhancement provider, in each case which has agreed in writing to
be bound by the provisions of this Section, or (iv) to any Liquidity Provider;
provided further, however, that the Transaction Documents may be disclosed to
the Liquidity Providers' and the Agent's respective legal counsel and
independent auditors; and provided further, however, that neither the Investor
nor the Agent shall have any obligation of confidentiality in respect of any
information which may be generally available to the public or becomes available
to the public through no fault of such Person.
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Section 9.11. Agreement Not to Petition. Each party hereto agrees, for
the benefit of the holders of the privately or publicly placed indebtedness for
borrowed money for Amsterdam, not, prior to the date which is one (1) year and
one (1) day after the payment in full of all such indebtedness, to acquiesce,
petition or otherwise, directly or indirectly, invoke, or cause Amsterdam to
invoke, the process of any Governmental Authority for the purpose of (a)
commencing or sustaining a case against Amsterdam under any federal or state
bankruptcy, insolvency or similar law (including the Federal Bankruptcy Code),
(b) appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official for Amsterdam, or any substantial part of
its property, or (c) ordering the winding up or liquidation of the affairs of
Amsterdam.
Section 9.12. Excess Funds. Other than amounts payable under Section
9.4, Amsterdam shall be required to make payment of the amounts required to be
paid pursuant hereto only if Amsterdam has Excess Funds (as defined below). If
Amsterdam does not have Excess Funds, the excess of the amount due hereunder
(other than pursuant to Section 9.4) over the amount paid shall not constitute a
"claim" (as defined in Section 101(5) of the Federal Bankruptcy Code) against
Amsterdam until such time as Amsterdam has Excess Funds. If Amsterdam does not
have sufficient Excess Funds to make any payment due hereunder (other than
pursuant to Section 9.4), then Amsterdam may pay a lesser amount and make
additional payments that in the aggregate equal the amount of deficiency as soon
as possible thereafter. The term "Excess Funds" means the excess of (a) the
aggregate projected value of Amsterdam's assets and other property (including
cash and cash equivalents), over (b) the sum of (i) the sum of all scheduled
payments of principal, interest and other amounts payable on publicly or
privately placed indebtedness of Amsterdam for borrowed money, plus (ii) the sum
of all other liabilities, indebtedness and other obligations of Amsterdam for
borrowed money or owed to any credit or liquidity provider, together with all
unpaid interest then accrued thereon, plus (iii) all taxes payable by Amsterdam
to the Internal Revenue Service, plus (iv) all other indebtedness, liabilities
and obligations of Amsterdam then due and payable, but the amount of any
liability, indebtedness or obligation of Amsterdam shall not exceed the
projected value of the assets to which recourse for such liability, indebtedness
or obligation is limited. Excess Funds shall be calculated once each Business
Day.
Section 9.13. No Recourse. The obligations of Amsterdam, its management
company, its administrator and its referral agents (each a "Program
Administrator") under any Transaction Document or other document (each, a
"Program Document") to which a Program Administrator is a party are solely the
corporate obligations of such Program Administrator and no recourse shall be had
for such obligations against any Affiliate, director, officer, member, manager,
employee, attorney or agent of any Program Administrator.
Section 9.14. Headings; Counterparts. Article and Section Headings in
this Agreement are for reference only and shall not affect the construction of
this Agreement. This Agreement may be executed by different parties on any
number of counterparts, each of which shall constitute an original and all of
which, taken together, shall constitute one and the same agreement.
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Section 9.15. Cumulative Rights and Severability. All rights and
remedies of the Purchasers and Agent hereunder shall be cumulative and
non-exclusive of any rights or remedies such Persons have under law or
otherwise. Any provision hereof that is prohibited or unenforceable in any
jurisdiction shall, in such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof and without affecting such provision in any other jurisdiction.
Section 9.16. Governing Law; Submission to Jurisdiction. This Agreement
shall be governed by, and construed in accordance with, the internal laws (and
not the law of conflicts) of the State of Illinois. The Seller hereby submits to
the nonexclusive jurisdiction of the United States District Court for the
Northern District of Illinois and of any Illinois state court sitting in
Chicago, Illinois for purposes of all legal proceedings arising out of, or
relating to, the Transaction Documents or the transactions contemplated thereby.
The Seller hereby irrevocably waives, to the fullest extent permitted by law,
any objection it may now or hereafter have to the venue of any such proceeding
and any claim that any such proceeding has been brought in an inconvenient
forum. Nothing in this Section 9.16 shall affect the right of the Agent or any
Purchaser to bring any action or proceeding against the Seller or its property
in the courts of other jurisdictions.
Section 9.17. Waiver of Trial by Jury. To the extent permitted by
applicable law, each party hereto irrevocably waives all right of trial by jury
in any action, proceeding or counterclaim arising out of, or in connection with,
any transaction document or any matter arising thereunder.
Section 9.18. Intended Tax Characterization. It is the intention of the
parties hereto that, for the purposes of all Taxes, the transactions
contemplated hereby shall be treated as a loan by the Purchasers (through the
Agent) to the Seller that is secured by the Receivables (the "Intended Tax
Characterization"). The parties hereto agree to report and otherwise to act for
the purposes of all Taxes in a manner consistent with the Intended Tax
Characterization.
Section 9.19. Entire Agreement. The Transaction Documents constitute the
entire understanding of the parties thereto concerning the subject matter
thereof. Any previous or contemporaneous agreements, whether written or oral,
concerning such matters are superceded thereby.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date hereof.
ABN AMRO BANK N.V., as the Agent ABN AMRO BANK N.V., as the Enhancer
By: By:
-------------------------------------------------- -----------------------------------------------------
Title: Title:
-------------------------------------------- -----------------------------------------------
By: By:
-------------------------------------------------- -----------------------------------------------------
Title: Title:
------------------------------------------- -----------------------------------------------
Address: Address:
Structured Finance, Asset Securitization Structured Finance, Asset Securitization
000 Xxxxx XxXxxxx Xxxxxx 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000 Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Purchaser Agent-Amsterdam Attention: Enhancer-Amsterdam
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
ABN AMRO BANK N.V., as a AMSTERDAM FUNDING CORPORATION
Liquidity Provider
By: By:
-------------------------------------------------- -----------------------------------------------------
Title: Title:
-------------------------------------------- -----------------------------------------------
By:
--------------------------------------------------
Title:
--------------------------------------------
Address: Address:
Structured Finance, Asset Securitization Global Securitization Services, LLC
000 Xxxxx XxXxxxx Xxxxxx 000 Xxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000 Xxx Xxxx, Xxx Xxxx 00000
Attention: Purchaser Agent-Amsterdam Attention: Xxxxxx Xxxxx
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
Signature Page for
Receivables Sale Agreement
44
with a copy to:
ARVINMERITOR RECEIVABLES ABN AMRO BANK N.V.
CORPORATION, as the Seller Address: Structured Finance,
Asset Securitization
000 Xxxxx XxXxxxx Xxxxxx
By: Xxxxxxx, Xxxxxxxx 00000-0000
--------------------------------------------------
Title: Attention: Administrator-
----------------------------------------------- Amsterdam
Address: 0000 Xxxx Xxxxx Xxxx Telephone: (000) 000-0000
Xxxx, Xxxxxxxx 00000 Telecopy: (000) 000-0000
Attention:
------------------------------
Telephone:
------------------------------
Telecopy:
-------------------------------
ARVINMERITOR, INC., as the Initial
Collection Agent
By:
-----------------------------------------------
Title:
-----------------------------------------
Address: 0000 Xxxx Xxxxx Xxxx
Xxxx, Xxxxxxxx 00000
Attention:
------------------------------
Telephone:
------------------------------
Telecopy:
-------------------------------
Signature Page for
Receivables Sale Agreement
45
SCHEDULE I
DEFINITIONS
The following terms have the meanings set forth, or referred to, below:
"ABN AMRO" means ABN AMRO Bank N.V. in its individual capacity and not
in its capacity as the Agent.
"Adverse Claim" means, for any asset or property of a Person, a lien,
security interest, charge, mortgage, pledge, hypothecation, assignment or
encumbrance, or any other right or claim, in, of or on such asset or property in
favor of any other Person, except those in favor of the Seller and the Agent.
"Affiliate" means, for any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with
such Person. For purposes of this definition, "control" means the power,
directly or indirectly, to either (i) vote ten percent (10%) or more of the
securities having ordinary voting power for the election of directors of a
Person or (ii) cause the direction of the management and policies of a Person.
"Agent" is defined in the first paragraph hereof.
"Agent's Account" means the account designated to the Seller and the
Purchasers by the Agent.
"Aggregate Commitment" means One Hundred Two Million Dollars
($102,000,000), as such amount may be reduced pursuant to Section 1.6.
"Aggregate Investment" means the sum of the Investments of all
Purchasers.
"Amsterdam" is defined in the first paragraph hereof.
"Amsterdam Funding Source" means any insurance company, bank or other
financial institution providing liquidity, back-up purchase or credit support
for Amsterdam.
"Amsterdam Settlement" means the sum of all claims and rights to
payment pursuant to Section 1.5 or 1.7 or any other provision owed to Amsterdam
(or owed to the Agent or the Collection Agent for the benefit of Amsterdam) by
the Seller that, if paid, would be applied to reduce Amsterdam's Investment.
"Amsterdam Termination Date" means the earlier of (a) the Business Day
designated by Amsterdam at any time to the Seller and (b) the Liquidity
Termination Date.
"Assigned Amsterdam Settlement" means, for each Committed Purchaser for
any Put, the product of such Purchaser's Purchased Percentage and the amount of
the Amsterdam Settlement being transferred pursuant to such Put.
46
"Average Receivables Turnover Ratio" means, at any time, the average of
the Receivables Turnover Ratios calculated for the most recent three calendar
months.
"Bankruptcy Event" means, for any Person, that (a) such Person makes a
general assignment for the benefit of creditors or any proceeding is instituted
by or against such Person seeking to adjudicate it bankrupt or insolvent, or
seeking the liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors and, if instituted
against such Person, such proceeding remains undismissed and unstayed for a
period of 30 days, or seeking the entry of an order for relief or the
appointment of a receiver, trustee or other similar official for it or any
substantial part of its property or such Person generally does not pay its debts
as such debts become due or admits in writing its inability to pay its debts
generally or (b) such Person takes any corporate action to authorize any such
action.
"Business Day" means any day other than (a) a Saturday, Sunday or other
day on which banks in New York, New York or Chicago, Illinois are authorized or
required to close, (b) a holiday on the Federal Reserve calendar and, solely for
matters relating to a Eurodollar Tranche, (c) a day on which dealings in Dollars
are not carried on in the London interbank market.
"Changeover Receivable" means a Receivable generated from the sale of
merchandise not manufactured by Parent or one or its Subsidiaries which has been
purchased by one of Seller's Subsidiaries from one of its customers.
"Charge-Off" means any Receivable that has or should have been (in
accordance with the Credit and Collection Policy) (i) charged off or written off
by the Seller, or (ii) reserved against as a doubtful account by the Seller.
"Collection" means any amount paid, or deemed paid, on a Receivable,
including from the proceeds of collateral securing such Receivables or paid by
the Seller as a Deemed Collection under Section 1.5(b).
"Collection Agent" is defined in Section 3.1(a).
"Collection Agent Fee" is defined in Section 3.6.
"Commitment" means, for each Committed Purchaser, the amount set forth
on Schedule II, as adjusted in accordance with Sections 1.6 and 9.8.
"Committed Purchasers" is defined in Section 1.1(b).
"Concentration Limit" means (i) an amount not to exceed 10% of the
aggregate outstanding principal balance of all Eligible Receivables for Obligors
with unsecured debt ratings of at least A- and A3 by S&P and/or Xxxxx'x,
respectively, (ii) an amount not to exceed 5% of the aggregate outstanding
principal balance of all Eligible Receivables for Obligors with unsecured debt
ratings of at least BBB- and Baa3 but less than A- and A3 by S&P and/or Xxxxx'x,
respectively, and (iii) an amount not to exceed 2.5% of the aggregate
outstanding
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principal balance of all Eligible Receivables for Obligors with unsecured debt
ratings of below BBB- and Baa3 by S&P and Xxxxx'x, respectively, or Obligors
that are not rated by S&P or Xxxxx'x.
"CP Dealer" means, at any time, each Person Amsterdam then engages as a
placement agent or commercial paper dealer.
"CP Discount" means, for any Discount Period, the amount of interest or
discount accrued, during such Discount Period on all the outstanding commercial
paper, or portion thereof, issued by Amsterdam to fund its Investment, including
all dealer commissions and other costs of issuing commercial paper, whether any
such commercial paper was issued specifically to fund such Investment or is
allocated, in whole or in part, to such funding.
"CP Rate" means, for any CP Tranche Period, a rate per annum equal to
the weighted average of the rates at which commercial paper notes having a term
equal to such CP Tranche Period may be sold by any CP Dealer selected by
Amsterdam. If such rate is a discount rate, the CP Rate shall be the rate
resulting from Amsterdam's converting such discount rate to an interest-bearing
equivalent rate. If Amsterdam determines that it is not able, or that it is
impractical, to issue commercial paper notes for any period of time, then the CP
Rate shall be the Prime Rate. The CP Rate shall include all costs and expenses
to Amsterdam of issuing the related commercial paper notes, including all dealer
commissions and note issuance costs in connection therewith.
"Credit Agreement" means that certain 5-Year Revolving Credit Agreement
dated as of June 28, 2000, among the Parent, certain foreign subsidiaries, the
lenders from time to time party thereto, Bank One, NA, as administrative agent,
The Chase Manhattan Bank, as syndication agent, and Citicorp USA, Inc. and Bank
of America, N.A., as documentation agents.
"Credit and Collection Policy" means the Seller's credit and collection
policy and practices relating to Receivables attached hereto as Exhibit H.
"Deemed Collections" is defined in Section 1.5(b).
"Default Ratio" means the average for the most recent three calendar
month period, of the ratios for each calendar month in such period of (i) the
aggregate outstanding balance of all Defaulted Receivables (minus Charge-Offs)
for such calendar month to (ii) the sum of the aggregate outstanding balance of
all Receivables at the end of such calendar month.
"Defaulted Receivable" means any Receivable (a) on which any amount is
unpaid more than 90 days past its original due date or (b) the Obligor on which
has suffered a Bankruptcy Event.
"Delinquency Ratio" means the average, for the most recent three
calendar month period, of the ratios for each calendar month in such period of
(a) the aggregate outstanding balance of all Delinquent Receivables on the last
day of such calendar month to (b) the aggregate outstanding balance of all
Receivables on the last day of such calendar month.
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"Delinquent Receivable" means any Receivable (other than a Defaulted
Receivable), the outstanding balance on which any amount is 31 to 90 days past
due.
"Designated Financial Officer" means any Vice President and the
Treasurer of the Seller.
"Dilution Ratio" means the average, for the most recent three calendar
month period, of the ratios for each calendar month in such period of (a) the
aggregate amount of payments owed by the Seller pursuant to the first sentence
of Section 1.5(b) during such calendar month to (b) the aggregate amount of
Collections during such calendar month.
"Dilution Reserve Percentage" means the greater of (i) 5% and (ii) the
product of (a) the highest Dilution Ratio during the most recent twelve calendar
months and (b) 3.
"Discount" means, for any Tranche Period, (a) the product of (i) the
Discount Rate for such Tranche Period, (ii) the total amount of Investment
allocated to such Tranche Period, and (iii) the number of days elapsed during
the Tranche Period divided by (b) 360.
"Discount Period" means, with respect to any Settlement Date or the
Liquidity Termination Date, the period from and including the preceding
Settlement Date (or if none, the date that the first Incremental Purchase is
made hereunder) to but not including such Settlement Date or Liquidity
Termination Date, as applicable.
"Discount Rate" means, for any Tranche Period, the CP Rate, the
Eurodollar Rate or the Prime Rate, as applicable, but after the occurrence of a
Termination Event each such rate shall be increased by 1.50% per annum with
respect to the Investment of the Liquidity Provider, Amsterdam and the Enhancer.
"Discount Reserve Percentage" means (a) the product of (i) the Prime
Rate plus 1.50%, (ii) the average Receivables Turnover Ratio of the three
calendar months preceding the date the Discount Rate Percentage is to be
determined and (iii) 1.5 divided by (b) 360.
"Downgrade" means, for any Person at any time, the downgrade of such
Person's long-term unsecured, unsubordinated indebtedness by Moody's below "A3"
or by S&P below "A-" (or Moody's or S&P has withdrawn or suspended such
rating.).
"Dollar" and "$" means lawful currency of the United States of America.
"Early Payment Fee" means, if any Investment of a Purchaser allocated
(or, in the case of a requested Purchase not made by the Committed Purchasers
for any reason other than their default, scheduled to be allocated) to a Tranche
Period for a CP Tranche or LIBOR Tranche is reduced or terminated before the
last day of such Tranche Period (the amount of Investment so reduced or
terminated being referred to as the "Prepaid Amount"), the cost to the relevant
Purchaser of terminating or reducing such Tranche, which (a) for a CP Tranche
means any compensation payable in prepaying the related commercial paper or, if
not prepaid, any shortfall between the amount that will be available to
Amsterdam on the maturity date of the related
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commercial paper from reinvesting the Prepaid Amount in Permitted Investments
and the Face Amount of such commercial paper and (b) for a LIBOR Tranche will be
determined based on the difference between the LIBOR applicable to such Tranche
and the LIBOR applicable for a period equal to the remaining maturity of the
Tranche on the date the Prepaid Amount is received.
"Eligible Receivable" means, at any time, any Receivable:
(i) the Obligor of which (a) is a resident of, or organized
under the laws of, or with its chief executive office in, the USA; (b)
is not an Affiliate of any of the parties hereto or any Originator; (c)
is not a government or a governmental subdivision or agency; and (d)
has not suffered a Bankruptcy Event;
(ii) which is stated to be due and payable within 60 days
after the invoice therefor; provided, however, up to 10% of the
aggregate outstanding principal balance of all Eligible Receivables may
be stated to be due and payable within 120 days after the invoice
therefor;
(iii) which is not a Defaulted Receivable, a Delinquent
Receivable or a Charge-Off;
(iv) which is an "account" or "chattel paper" within the
meaning of Section 9-105 and Section 9-106, respectively of the UCC of
all applicable jurisdictions;
(v) which is denominated and payable only in Dollars in the
USA;
(vi) which arises under a contract that is in full force and
effect and constitutes the legal, valid and binding obligation of the
related Obligor enforceable against such Obligor in accordance with its
terms subject to no offset, counterclaim, defense or other Adverse
Claim, and is not an executory contract or unexpired lease within the
meaning of Section 365 of the Bankruptcy Code;
(vii) which arises under a contract that (A) contains an
obligation to pay a specified sum of money, contingent only upon the
sale or lease of goods or the provision of services by the Originator,
(B) does not require the Obligor under such contract to consent to the
transfer, sale or assignment of the rights of the related Originator
under such contract, (C) does not contain a confidentiality provision
that purports to restrict any Purchaser's exercise of rights under this
Agreement, including, without limitation, the right to review such
contract, and (D) directs that payment be made to a Lock-Box or other
collection account;
(viii) which does not, in whole or in part, contravene any
law, rule or regulation applicable thereto (including, without
limitation, those relating to usury, truth in lending, fair credit
credit reporting, equal credit opportunity, fair debt collection
billing, fair practices and privacy);
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(ix) which satisfies all applicable requirements of the Credit
and Collection Policy and was generated in the ordinary course of the
related Originator's business from the sale of goods or provision of
services to a related Obligor solely by such Originator;
(x) is not evidenced by any promissory note or other
instrument;
(xi) does not represent any amount due with respect to any
sales or similar tax;
(xii) is not a Changeover Receivable; and
(xiii) is not due from any Obligor the Defaulted Receivables
of which exceed 25% of such Obligor's Receivables.
"Eligible Receivables Balance" means, at any time, the aggregate
outstanding principal balance of all Eligible Receivables at such time, less the
portion of the aggregate outstanding principal balance of (a) Eligible
Receivables of any Obligor (other than a Special Obligor) at such time which
exceed the Concentration Limit, and (b) Eligible Receivables of any Special
Obligor which exceed the Special Limit, at such time.
"Enhancer" is defined in the first paragraph hereof.
"Enhancer Commitment Percentage" means ten percent (10%).
"Eurodollar Rate" means, for any Tranche Period for a LIBOR Tranche,
the sum of (a) LIBOR for such Tranche Period divided by 1 minus the "Reserve
Requirement" plus (b) (i) for the Investment of a Liquidity Provider the amount
specified in the Pricing Letter, or, (ii) for Investment of the Enhancer, the
amount specified in the Fee Letter; where "Reserve Requirement" means, for any
Tranche Period for a LIBOR Tranche, the maximum reserve requirement imposed
during such Tranche Period on "eurocurrency liabilities" as currently defined in
Regulation D of the Board of Governors of the Federal Reserve System.
"Face Amount" means the face amount of any Amsterdam commercial paper
issued on a discount basis or, if not issued on a discount basis, the principal
amount of such note and interest scheduled to accrue thereon to its stated
maturity.
"Federal Funds Rate" means for any day the greater of (i) the average
rate per annum as determined by ABN AMRO at which overnight Federal funds are
offered to ABN AMRO for such day by major banks in the interbank market, and
(ii) if ABN AMRO is borrowing overnight funds from a Federal Reserve Bank that
day, the average rate per annum at which such overnight borrowings are made on
that day. Each determination of the Federal Funds Rate by ABN AMRO shall be
conclusive and binding on the Seller except in the case of manifest error.
"Fee Letter" means the letter agreement, dated as of the date hereof,
between the Seller and the Agent. The Fee Letter is a supplement hereto.
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"Funding Agreement" means any agreement or instrument executed by
Amsterdam and executed by or in favor of any Amsterdam Funding Source or
executed by any Amsterdam Funding Source at the request of Amsterdam (including
the Program LOC).
"Funding Charges" means, for any day, the product of (i) the per annum
rate (inclusive of dealer fees and commissions) paid or payable by Amsterdam in
respect of commercial paper notes on such day that are allocated, in whole or in
part, to fund or maintain its Investment for such day, as determined by the
Agent, and other costs allocated by a Purchaser to fund or maintain its
Investment associated with the funding by Amsterdam of small or odd lot amounts
that are not funded with commercial paper notes and (ii) Amsterdam's Investment
as of the end of such day and (iii) 1/360.
"GAAP" means generally accepted accounting principles in the USA,
applied on a consistent basis.
"Governmental Authority" means any (a) Federal, state, municipal or
other governmental entity, board, bureau, agency or instrumentality, (b)
administrative or regulatory authority (including any central bank or similar
authority) or (c) court, judicial authority or arbitrator, in each case, whether
foreign or domestic.
"Incremental Purchase" is defined in Section 1.1(b).
"Initial Collection Agent" is defined in the first paragraph hereof.
"Instructing Group" means the Required Liquidity Providers, the
Enhancer and, unless the Amsterdam Termination Date has occurred and Amsterdam
has no Investment, Amsterdam.
"Intended Tax Characterization" is defined in Section 9.18.
"Interim Liquidation" means that no Reinvestment Purchases are made by
any Purchaser at a time before the Liquidity Termination Date, as established
pursuant to Section 1.2.
"Investment" means, for each Purchaser, (a) the sum of (i) all
Incremental Purchases by such Purchaser and (ii) the aggregate amount of any
payments or exchanges made by, or on behalf of, such Purchaser to any other
Purchaser to acquire Investment from such other Purchaser minus (b) all
Collections, amounts received from other Purchasers, and other amounts received
or exchanged and, in each case, applied by the Agent or such Purchaser to reduce
such Purchaser's Investment pursuant to this Agreement. A Purchaser's Investment
shall be restored to the extent any amounts so received or exchanged and applied
are rescinded or must be returned for any reason.
"Letter Agreement" means that certain Letter Agreement dated as of
March 30, 2001 between ArvinMeritor, Inc. and the Originators.
"LIBOR" means, for any Tranche Period for a LIBOR Tranche or other time
period, the rate per annum (rounded upwards, if necessary, to the next higher
one hundred-thousandth of a
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percentage point) for deposits in Dollars for a period equal to such Tranche
Period or other period, which appears on Page 3750 of the Telerate Service (or
any successor page or successor service that displays the British Bankers'
Association Interest Settlement Rates for Dollar deposits) as of 11:00 a.m.
(London, England time) two Business Days before the commencement of such Tranche
Period or other period. If for any Tranche Period for a LIBOR Tranche no such
displayed rate is available (or, for any other period, if such displayed rate is
not available or the need to calculate LIBOR is not notified to the Agent at
least 3 Business Days before the commencement of the period for which it is to
be determined), the Agent shall determine such rate based on the rates ABN AMRO
is offered deposits of such duration in the London interbank market.
"Limited Guaranty" means the Limited Guaranty, dated the date hereof,
by the Parent in favor of the Agent.
"Liquidation Period" for any Purchaser means all times (x) during an
Interim Liquidation and (y) on and after the Liquidity Termination Date and, for
Amsterdam only, also means all times when Amsterdam is not making Reinvestment
Purchases pursuant to Section 1.1(d).
"Liquidity Providers" is defined in the first paragraph hereof.
"Liquidity Termination Date" means the earliest of (a) the date of the
occurrence of a Termination Event described in clause (e) of the definition of
Termination Event, (b) the date designated by the Agent to the Seller at any
time after the occurrence of any other Termination Event, (c) the Business Day
designated by the Seller with no less than thirty (30) Business Days prior
notice to the Agent and (d) March 29, 2002.
"Lock-Box" means each post office box or bank box listed on Exhibit E,
as revised pursuant to Section 5.1(i).
"Lock-Box Account" means each account maintained by the Seller at a
Lock-Box Bank for the purpose of receiving or concentrating Collections.
"Lock-Box Agreement" means each agreement between the Seller,
Originator and a Lock-Box Bank concerning a Lock-Box Account.
"Lock-Box Bank" means each bank listed on Exhibit E, as revised
pursuant to Section 5.1(i).
"Lock-Box Letter" means a letter in substantially the form of Exhibit F
(or otherwise acceptable to the Agent) from the Seller or an Originator to each
Lock-Box Bank, acknowledged and accepted by such Lock-Box Bank and the Agent.
"Loss Reserve Percentage" means the greater of (i) 12.5% and (ii) the
highest Delinquency Ratio during the most recent twelve calendar months times 4.
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"Loss-to-Liquidation Ratio" means, for the most recent calendar month,
the ratio of the outstanding balance of Receivables that become Charge-Offs
during such month to the aggregate amount of Collections during such calendar
month.
"Matured Aggregate Investment" means, at any time, the Matured Value of
Amsterdam's Investment plus the total Investments of all other Purchasers then
outstanding.
"Matured Value" means, of any Investment, the sum of such Investment
and all unpaid Discount, fees and other amounts scheduled to become due (whether
or not then due) on such Investment during all Tranche Periods to which any
portion of such Investment has been allocated.
"Maximum Incremental Purchase Amount" means, at any time, the lesser of
(a) the difference between the Purchase Limit and the Aggregate Investment then
outstanding and (b) the difference between the Aggregate Commitment and the
Matured Aggregate Investment then outstanding.
"Maximum Receivables Turnover Ratio" is defined in clause (f) of the
definition of "Termination Event" herein.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Worth" means, at any time the same is to be determined, the total
shareholders' equity (including capital stock, additional paid-in capital and
retained earnings after deducting treasury stock) which would appear on the
balance sheet of the Seller determined in accordance with GAAP.
"Obligor" means, for any Receivable, each Person obligated to pay such
Receivable and each guarantor of such obligation.
"Originator" means Xxxxx Exhaust LLC, an Indiana limited liability
company, Maremont Exhaust Products, Inc., a Delaware corporation, Purolater
Products NA, Inc., a Delaware corporation, and Xxxxxxx Ride Control Products,
Inc., a Delaware corporation.
"Outside Servicing Fee" means the fee agreed to by the Collection
Agent, the Seller and the Agent.
"Parent" means ArvinMeritor, Inc., an Indiana corporation.
"Periodic Report" is defined in Section 3.3.
"Permitted Investments" means (a) evidences of indebtedness, maturing
within thirty (30) days after the date of purchase thereof, issued by, or
guaranteed by the full faith and credit of, the federal government of the USA,
(b) repurchase agreements with banking institutions or broker-dealers registered
under the Securities Exchange Act of 1934 which are fully secured by obligations
of the kind specified in clause (a), (c) money market funds (i) rated not lower
than
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the highest rating category from Moody's and "AAA m" or "AAAm-g," from S&P or
(ii) which are otherwise acceptable to the Rating Agencies or (d) commercial
paper issued by any corporation incorporated under the laws of the USA and rated
at least "A-1" (or the equivalent) by S&P and at least "P-1" (or the equivalent)
by Moody's.
"Person" means an individual, partnership, corporation, limited
liability company, association, joint venture, Governmental Authority or other
entity of any kind.
"Potential Termination Event" means any Termination Event or any event
or condition that with the lapse of time or giving of notice, or both, would
constitute a Termination Event.
"Pricing Letter" means the letter agreement, dated as of the date
hereof, between the Seller and the Agent. The Pricing Letter is a supplement
hereto.
"Prime Rate" means, for any period, the daily average during such
period of the greater of (a) the floating commercial loan rate per annum of ABN
AMRO (which rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer by ABN AMRO) announced from
time to time as its prime rate or equivalent for Dollar loans in the USA,
changing as and when said rate changes and (b) the Federal Funds Rate plus
0.50%.
"Program LOC" means that certain amended and restated irrevocable
transferable letter of credit No. S579017, dated June 11, 1997, issued by the
Enhancer at the request of Amsterdam, and each letter of credit issued in
substitution or replacement therefor.
"Program Unreimbursed Draw Amount" means the sum of all draws under the
Program LOC in connection with this transaction which have not been reimbursed
(whether through the payment of cash or the exchange of assets), together with
all interest thereon and all other amounts, if any, payable in connection
therewith.
"Purchase" is defined in Section 1.1(a).
"Purchase Agreement" means the Purchase and Sale Agreement dated as of
the date hereof between the Seller and the Originators.
"Purchase Amount" is defined in Section 1.1(c).
"Purchase Date" is defined in Section 1.1(c).
"Purchase Interest" means, for a Purchaser, the percentage ownership
interest in the Receivables and Collections held by such Purchaser, calculated
when and as described in Section 1.1(a); provided, however, that (except for
purposes of computing a Purchase Interest or the Sold Interest in Section 1.5 or
1.7) at any time the Sold Interest would otherwise exceed 100% each Purchaser
then holding any Investment shall have its Purchase Interest reduced by
multiplying such Purchase Interest by a fraction equal to 100% divided by the
Sold Interest otherwise then in effect, so that the Sold Interest is thereby
reduced to 100%.
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"Purchase Limit" means as of any day, the Aggregate Commitment
multiplied by 1/1.02.
"Purchased Percentage" means, for any Put, for each Committed
Purchaser, its Ratable Share or such lesser percentage as is necessary to
prevent the Purchase Price of such Purchaser from exceeding its Unused
Commitment (unless, in the case of the Enhancer, it elects not to reduce its
Purchased Percentage in whole or in part).
"Purchaser Reserve Percentage" means, for each Purchaser, the Total
Reserve multiplied by a fraction, the numerator of which is such Purchaser's
outstanding Investment and the denominator of which is the Aggregate Investment.
"Purchasers" means the Liquidity Providers, the Enhancer and Amsterdam.
"Put" is defined in Section 2.l(a).
"Ratable Share" means, for each Committed Purchaser, such Purchaser's
Commitment divided by the Aggregate Commitment. If, however, on the date any
Incremental Purchase or payment for any Put is to be made by the Committed
Purchasers, the aggregate amount of the outstanding Investment plus Program
Unreimbursed Draw Amount of the Enhancer exceeds its Ratable Share of the
outstanding Investment of all Committed Purchasers and Program Unreimbursed Draw
Amount of the Enhancer, then for purposes of such Incremental Purchase or Put
the Ratable Share of each Committed Purchaser shall be replaced with a
percentage equal for each Committed Purchaser to (a) its Commitment minus its
Investment before such Purchase or Put and Program Unreimbursed Draw Amount
before such Purchase or Put (its "Existing Investment") divided by (b) the
Aggregate Commitment minus the sum of the Existing Investments of all Committed
Purchasers.
"Rating Agency" means Moody's, S&P and any other rating agency
Amsterdam chooses to rate its commercial paper notes.
"Ratings" means the ratings by the Rating Agencies of the indebtedness
for borrowed money of Amsterdam.
"Receivable" means the obligation of an Obligor to pay for merchandise
sold or services rendered by an Originator and includes the Seller's rights to
payment of any interest or finance charges and in the merchandise (including
returned goods) and contracts relating to such Receivable, all security
interests, guaranties and property securing or supporting payment of such
Receivable, all Records and all proceeds of the foregoing. During any Interim
Liquidation and on and after the Liquidity Termination Date, the term
"Receivable" shall only include receivables existing on the date such Interim
Liquidation commenced or Liquidity Termination Date occurred, as applicable.
Deemed Collections shall reduce the outstanding balance of Receivables
hereunder, so that any Receivable that has its outstanding balance deemed
collected shall cease to be a Receivable hereunder after (x) the Collection
Agent receives payment of such Deemed Collections under Section 1.5(b) or (y) if
such Deemed Collection is received before the Liquidity Termination Date, an
adjustment to the Sold Interest permitted by Section 1.5(c) is made.
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"Receivables Turnover Ratio" means, with respect to a calendar month,
an amount, expressed in days, obtained by multiplying (a) a fraction, (i) the
numerator of which is equal to the aggregate outstanding principal balance of
all Receivables as of the first day of such calendar month and (ii) the
denominator of which is equal to Collections during the same such calendar
month; times (b) 30.
"Records" means, for any Receivable, all contracts, books, records and
other documents or information (including computer programs, tapes, disks,
software and related property and rights) relating to such Receivable or the
related Obligor.
"Reinvestment Purchase" is defined in Section 1.1(b).
"Related Security" means all of each Originator's rights in the
merchandise (including returned goods) and contracts relating to the
Receivables, all security interests, guaranties and property securing or
supporting payment of the Receivables, all Records and all proceeds of the
foregoing.
"Required Liquidity Providers" means Liquidity Providers having
Liquidity Provider Commitments in excess of 66-2/3% of the Commitment of all
Liquidity Providers or, if the Commitments of all Liquidity Providers shall then
have been terminated, such Liquidity Providers as together shall then own in
excess of sixty-six and two-thirds percent (66-2/3%) of the sum of the
Investments for all the Liquidity Providers at such time. For purposes of this
definition, prior to the Liquidity Termination Date, any Liquidity Provider that
has funded a Collateral Account pursuant to Section 4.12(e) of the Transfer
Agreement shall be deemed to have a Commitment equal to the sum of the amount on
deposit in such Collateral Account (less any earnings therein) plus the
outstanding amount of such Liquidity Provider's Investment.
"Reserve Percentage" means, at any time, the quotient obtained by
dividing (a) the Total Reserve by (b) the Eligible Receivables Balance.
"Seller" is defined in the first paragraph hereof.
"Seller Account" means an account designated by the Seller to the Agent
with at least ten (10) days prior notice.
"Seller Entity" means the Parent and each Originator.
"Seller Servicing Fee" means, for each month, the fee agreed to by the
Collection Agent, the Seller and the Agent.
"Servicer Reserve Percentage" means the greater of (i) the Seller
Servicing Fee or the Outside Servicing Fee, as applicable, and (ii) 0.50%.
"Settlement Date" means the 20th day of each calendar month.
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"Sold Interest" is defined in Section 1.1(a); provided, however, that
the Sold Interest shall not exceed one hundred percent (100%).
"Special Limit" means an amount not to exceed 50% of the aggregate
outstanding principal balance of all Eligible Receivables for the Special
Obligors.
"Special Obligors" means Ford Motor Company, General Motors Corporation
and Daimler Chrysler Corporation; provided, however, that if at any time any
such entity becomes subject to a Downgrade, such entity shall no longer be
treated as a Special Obligor hereunder.
"Special Transaction Subaccount" means the special transaction
subaccount established for this Agreement pursuant to Amsterdam's depositary
agreement.
"S&P" means Standard & Poor's Ratings Services.
"Subordinated Note" means each revolving promissory note issued by the
Seller to an originator under the Purchase Agreement.
"Subsidiary" means any Person of which at least a majority of the
voting stock (or equivalent equity interests) is owned or controlled by the
Parent or any Originator or by one or more other Subsidiaries of the Parent or
any Originator.
"Taxes" means all taxes, charges, fees, levies or other assessments
(including income, gross receipts, profits, withholding, excise, property,
sales, use, license, occupation and franchise taxes and including any related
interest, penalties or other additions) imposed by any jurisdiction or taxing
authority (whether foreign or domestic).
"Termination Date" means (a) for Amsterdam, the Amsterdam Termination
Date and (b) for the Liquidity Providers and the Enhancer, the Liquidity
Termination Date.
"Termination Event" means the occurrence of any one or more of the
following:
(a) any representation, warranty, certification or statement
made, or deemed made by the Seller, the Parent or the Collection Agent
in, or pursuant to, any Transaction Document proves to have been
incorrect in any material respect when made or deemed made; or
(b) the Collection Agent or the Seller fails to make any
payment or other transfer of funds hereunder within five (5) Business
Days when due; or
(c) the Seller fails to observe or perform any covenant or
agreement contained in Sections 5.1(b), (g), (i), (j) and (k), the
Collection Agent fails to observe or perform any covenant or agreement
contained in Sections 5.2(b), (g), (i) and (j) or an Originator fails
to perform any covenant or agreement in Sections 5.1(b), (g), (h), (i)
and (j) of the Purchase Agreement; or
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(d) the Seller or the Collection Agent (or any sub-collection
agent) fails to observe or perform any other term, covenant or
agreement under any Transaction Document, and such failure remains
unremedied for ten Business Days; or
(e) the Seller, the Collection Agent, any Seller Entity or any
Subsidiary suffers a Bankruptcy Event; or
(f) the Delinquency Ratio exceeds 6%, the Default Ratio
exceeds 6%, the Dilution Ratio exceeds 10%, the Loss-to Liquidation
Ratio exceeds 2.5% or the Average Receivables Turnover Ratio exceeds 90
days; or
(g) (i) the Seller, any Seller Entity or any Affiliate,
directly or indirectly, disaffirms or contests the validity or
enforceability of any Transaction Document or (ii) any Transaction
Document fails to be the enforceable obligation of the Seller, any
Seller Entity or any Affiliate party thereto; or
(h) the Seller, any Seller Entity or any Subsidiary generally
does not pay its debts as such debts become due or admits in writing
its inability to pay its debts generally; or
(i) the occurrence of any event or the existence of any
condition which is specified as a Default under the Credit Agreement
shall constitute a "Termination Event" hereunder (regardless of whether
any indebtedness is now or hereafter remains outstanding thereunder or
whether the Credit Agreement shall have terminated); or
(j) (i) the Parent's long-term unsecured, unsubordinated
indebtedness is rated less than "BBB-" by S&P and "Baa3" by Moody's (or
S&P and Moody's has withdrawn or suspended such ratings) or (ii) the
Parent's long-term unsecured, unsubordinated indebtedness is rated less
than "BB+" by S&P or "Ba1" by Moody's (or S&P or Moody's has withdrawn
or suspended such rating); or
(k) the Parent shall fail to own and control, directly or
indirectly, 100% of the outstanding voting stock of the Seller and each
Originator.
Notwithstanding the foregoing, a failure of a representation or warranty or
breach of any covenant described in clause (a), (c) or (d) above shall not
constitute a Termination Event if the Seller has been deemed to have collected
the affected Receivable pursuant to Section 1.5(b).
"Total Reserve" means an amount equal to the sum of (i) the Discount
Reserve Percentage multiplied by the Aggregate Commitment, (ii) the Dilution
Reserve Percentage multiplied by the Eligible Receivables Balance, (iii) the
Loss Reserve Percentage multiplied by the Eligible Receivables Balance and (iv)
the Servicing Reserve Percentage multiplied by the Eligible Receivables Balance.
"Tranche" means a portion of the Investment of a Amsterdam or of the
Committed Purchasers allocated to a Tranche Period pursuant to Section 1.3. A
Tranche is a (i) CP Tranche,
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(ii) LIBOR Tranche or (iii) Prime Tranche depending whether Discount accrues
during its Tranche Period based on a (i) CP Rate, (ii) Eurodollar Rate or (iii)
Prime Rate.
"Tranche Period" means a period of days ending on a Business Day
selected pursuant to Section 1.3, which (i) for a CP Tranche shall not exceed
270 days, (ii) for a LIBOR Tranche shall not exceed 180 days, and (iii) for a
Prime Tranche shall not be less than 2 days and shall not exceed 30 days.
"Transaction Documents" means this Agreement, the Fee Letter, the
Limited Guaranty, the Pricing Letter, the Purchase Agreement, the Subordinated
Note(s), the Transfer Agreement and all other documents, instruments and
agreements executed or furnished in connection herewith and therewith.
"Transfer Agreement" means the Amsterdam Transfer Agreement dated the
date hereof between Amsterdam, ABN AMRO Bank N.V., in its capacity as the
Amsterdam Agent, Amsterdam's Letter of Credit Provider and a Liquidity Provider
and the Other Persons who become Liquidity Providers thereunder.
"Transfer Supplement" is defined in Section 9.8.
"UCC" means, for any state, the Uniform Commercial Code as in effect in
such state.
"USA" means the United States of America (including all states and
political subdivisions thereof).
"Unused Aggregate Commitment" means, at any time, the difference
between the Aggregate Commitment then in effect and the outstanding Matured
Aggregate Investment.
"Unused Commitment" means, for any Committed Purchaser at any time, the
difference between its Commitment and its Investment then outstanding.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms. Unless otherwise inconsistent
with the terms of this Agreement, all accounting terms used herein shall be
interpreted, and all accounting determinations hereunder shall be made, in
accordance with GAAP. Amounts to be calculated hereunder shall be continuously
recalculated at the time any information relevant to such calculation changes.
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SCHEDULE II
LIQUIDITY PROVIDERS AND COMMITMENTS OF COMMITTED PURCHASERS
NAME OF LIQUIDITY PROVIDER COMMITMENT
-------------------------- ----------
ABN AMRO Bank N.V. $91,800,000
ENHANCER
ABN AMRO Bank N.V. $10,200,000