RECEIVABLES PURCHASE AGREEMENT
DATED AS OF JUNE 19, 2001
AMONG
TOWER AUTOMOTIVE RECEIVABLES COMPANY, INC., AS SELLER,
X. X. TOWER CORPORATION, AS INITIAL SERVICER,
BLUE RIDGE ASSET FUNDING CORPORATION
AND
WACHOVIA BANK, N.A., AS AGENT
TABLE OF CONTENTS
PAGE
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ARTICLE I. PURCHASE ARRANGEMENTS..................................................................................1
Section 1.1 Purchase Facility...............................................................................1
Section 1.2 Incremental Purchases...........................................................................2
Section 1.3 Decreases.......................................................................................2
Section 1.4 Deemed Collections; Purchase Limit..............................................................2
Section 1.5 Payment Requirements and Computations...........................................................3
ARTICLE II. PAYMENTS AND COLLECTIONS..............................................................................4
Section 2.1 Payments of Recourse Obligations................................................................4
Section 2.2 Collections Prior to the Facility Termination Date; Repayment of Certain Demand Advances........4
Section 2.3 Repayment of Demand Advances on the Facility Termination Date; Collections......................5
Section 2.4 Payment Rescission..............................................................................6
Section 2.5 Clean Up Call...................................................................................6
ARTICLE III. COMMERCIAL PAPER FUNDING.............................................................................6
Section 3.1 CP Costs........................................................................................6
Section 3.2 Calculation of CP Costs.........................................................................6
Section 3.3 CP Costs Payments...............................................................................7
Section 3.4 Default Rate....................................................................................7
ARTICLE IV. LIQUIDITY FUNDINGS....................................................................................7
Section 4.1 Liquidity Fundings..............................................................................7
Section 4.2 Yield Payments..................................................................................7
Section 4.3 Selection and Continuation of Interest Periods..................................................7
Section 4.4 Liquidity Funding Yield Rates...................................................................7
Section 4.5 Suspension of the LIBO Rate.....................................................................8
Section 4.6 Default Rate....................................................................................8
ARTICLE V. REPRESENTATIONS AND WARRANTIES.........................................................................8
Section 5.1 Representations and Warranties of the Seller Parties............................................8
ARTICLE VI. CONDITIONS OF PURCHASES..............................................................................12
Section 6.1 Conditions Precedent to Initial Incremental Purchase...........................................12
Section 6.2 Conditions Precedent to All Purchases and Reinvestments........................................12
ARTICLE VII. COVENANTS...........................................................................................13
Section 7.1 Affirmative Covenants of the Seller Parties....................................................13
Section 7.2 Negative Covenants of the Seller Parties.......................................................20
ARTICLE VIII. ADMINISTRATION AND COLLECTION......................................................................22
Section 8.1 Designation of Servicer........................................................................22
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Section 8.2 Duties of Servicer.............................................................................23
Section 8.3 Collection Notices.............................................................................24
Section 8.4 Responsibilities of Seller.....................................................................25
Section 8.5 Monthly Reports................................................................................25
Section 8.6 Servicing Fee..................................................................................25
ARTICLE IX. AMORTIZATION EVENTS..................................................................................25
Section 9.1 Amortization Events............................................................................25
Section 9.2 Remedies.......................................................................................28
ARTICLE X. INDEMNIFICATION.......................................................................................29
Section 10.1 Indemnities by the Seller Parties..............................................................29
Section 10.2 Increased Cost and Reduced Return..............................................................31
Section 10.3 Other Costs and Expenses.......................................................................32
Section 10.4 Allocations....................................................................................32
ARTICLE XI. THE AGENT............................................................................................32
Section 11.1 Authorization and Action.......................................................................32
ARTICLE XII. ASSIGNMENTS AND PARTICIPATIONS......................................................................33
Section 12.1 Assignments and Participations by Blue Ridge...................................................33
Section 12.2 Prohibition on Assignments by Seller Parties...................................................33
ARTICLE XIII. MISCELLANEOUS......................................................................................33
Section 13.1 Waivers and Amendments.........................................................................33
Section 13.2 Notices........................................................................................34
Section 13.3 Protection of Agent's Security Interest........................................................34
Section 13.4 Confidentiality................................................................................35
Section 13.5 Bankruptcy Petition............................................................................36
Section 13.6 Limitation of Liability........................................................................36
Section 13.7 CHOICE OF LAW..................................................................................36
Section 13.8 CONSENT TO JURISDICTION........................................................................36
Section 13.9 WAIVER OF JURY TRIAL...........................................................................37
Section 13.10 Integration; Binding Effect; Survival of Terms.................................................37
Section 13.11 Counterparts; Severability; Section References.................................................37
Section 13.12 Characterization...............................................................................38
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EXHIBITS AND SCHEDULES
Exhibit I Definitions
Exhibit II Form of Purchase Notice
Exhibit III Places of Business of the Seller Parties; Locations of
Records; Federal Employer Identification Number(s)
Exhibit IV Names of Collection Banks; Collection Accounts
Exhibit V Form of Compliance Certificate
Exhibit VI Form of Collection Account Agreement
Exhibit VII [Intentionally Deleted]
Exhibit VIII Form of Monthly Report
Exhibit IX [Intentionally Deleted]
Exhibit X Form of Performance Undertaking
Schedule A Closing Documents
Schedule B Approved Business Units
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RECEIVABLES PURCHASE AGREEMENT
THIS RECEIVABLES PURCHASE AGREEMENT, dated as of June 19, 2001 is
entered into by and among:
(a) Tower Automotive Receivables Company, Inc., a Michigan corporation
("SELLER"),
(b) X. X. Tower Corporation, a Michigan corporation ("TOWER"), as
initial Servicer (the Servicer together with Seller, the "SELLER PARTIES"
and each, a "SELLER PARTY"),
(c) Blue Ridge Asset Funding Corporation, a Delaware corporation ("BLUE
RIDGE"), and
(d) Wachovia Bank, N.A., as agent for Blue Ridge and its assigns under
the Transaction Documents and under the Liquidity Agreement (together with
its successors and assigns in such capacity, the "AGENT").
UNLESS DEFINED ELSEWHERE HEREIN, CAPITALIZED TERMS USED IN THIS AGREEMENT SHALL
HAVE THE MEANINGS ASSIGNED TO SUCH TERMS IN EXHIBIT I.
PRELIMINARY STATEMENTS
Seller desires to transfer and assign Receivable Interests from time to
time.
Blue Ridge shall purchase Receivable Interests from Seller from time to
time either by issuing its Commercial Paper or by availing itself of a
Liquidity Funding to the extent available.
Wachovia Bank, N.A. has been requested and is willing to act as Agent
on behalf of Blue Ridge and its assigns in accordance with the terms
hereof.
ARTICLE I.
PURCHASE ARRANGEMENTS
Section 1.1 Purchase Facility.
(a) Upon the terms and subject to the conditions of this Agreement
(including, without limitation, Article VI), from time to time prior to the
Facility Termination Date, Seller may request that Blue Ridge purchase from
Seller undivided ownership interests in the Receivables and the associated
Related Security and Collections, and Blue Ridge shall make such Purchase;
PROVIDED THAT no Purchase shall be made by Blue Ridge if, after giving effect
thereto, either (i)the Aggregate Invested Amount would exceed the Purchase
Limit, or (ii) the aggregate of the Receivable Interests would exceed 100%. It
is the intent of Blue Ridge to fund the Purchases by the issuance of Commercial
Paper. If for any reason Blue Ridge is unable, or determines that it is
undesirable, to issue Commercial Paper to fund or maintain its investment in
the Receivable Interests, or is unable for any reason to repay such Commercial
Paper upon the maturity thereof, Blue Ridge will avail itself of a Liquidity
Funding to the extent available. If Blue Ridge funds or refinances its
investment in a Receivable Interest through Liquidity Fundings, in lieu of
paying CP Costs on the Invested Amount pursuant to Article III hereof, Seller
will pay Yield thereon at the Alternate Base Rate or the LIBO Rate, selected in
accordance with Article IV hereof. Nothing herein shall be deemed to constitute
a commitment of Blue Ridge to issue Commercial Paper.
(b) Seller may, upon at least ten (10) Business Days' notice to the
Agent, terminate in whole or reduce in part, the unused portion of the Purchase
Limit; PROVIDED THAT each partial reduction of the Purchase Limit shall be in an
amount equal to $5,000,000 (or a larger integral multiple of $1,000,000 if in
excess thereof).
Section 1.2 Incremental Purchases. Seller shall provide the Agent with
at least two (2) Business Days' prior written notice in a form set forth as
Exhibit II hereto of each Incremental Purchase (each, a "PURCHASE NOTICE"). Each
Purchase Notice shall be subject to Section 6.2 hereof and, except as set forth
below, shall be irrevocable and shall specify the requested Purchase Price
(which shall not be less than $1,000,000 or a larger integral multiple of
$100,000) and the Purchase Date; PROVIDED, HOWEVER, that no more than three (3)
Incremental Purchases may be made in any calendar month. Following receipt of a
Purchase Notice, the Agent will determine whether Blue Ridge will fund the
requested Incremental Purchase through the issuance of Commercial Paper or
through a Liquidity Funding. If Blue Ridge determines to fund an Incremental
Purchase through a Liquidity Funding, Seller may cancel the Purchase Notice or,
in the absence of such a cancellation, the Incremental Purchase will be funded
through a Liquidity Funding. On each Purchase Date, upon satisfaction of the
applicable conditions precedent set forth in Article VI, Blue Ridge shall
deposit to the Facility Account, in immediately available funds, no later than
2:00 p.m. (New York time), an amount equal to the requested Purchase Price.
Section 1.3 Decreases. Seller shall provide the Agent with prior
written notice in conformity with the Required Notice Period (a "REDUCTION
NOTICE") of any proposed reduction of Aggregate Invested Amount. Such Reduction
Notice shall designate (i) the date (the "PROPOSED REDUCTION DATE") upon which
any such reduction of Aggregate Invested Amount shall occur (which date shall
give effect to the applicable Required Notice Period), and (ii) the amount of
Aggregate Invested Amount to be reduced which shall be applied ratably to all
Receivable Interests in accordance with the respective Invested Amounts thereof
(the "AGGREGATE REDUCTION"). Only one (1) Reduction Notice shall be outstanding
at any time.
Section 1.4 Deemed Collections; Purchase Limit.
(a) If on any day:
(i) the Outstanding Balance of any Receivable originated by an
Approved Business Unit is reduced or cancelled as a result of any
defective or rejected goods or services, any cash discount or any other
adjustment by any Seller Party or any Affiliate thereof, or as a result
of any governmental or regulatory action, or
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(ii) the Outstanding Balance of any Receivable originated by an
Approved Business Unit is reduced or canceled as a result of a setoff
in respect of any claim by the Obligor thereof (whether such claim
arises out of the same or a related or an unrelated transaction), or
(iii) the Outstanding Balance of any Receivable originated by
an Approved Business Unit is reduced on account of the obligation of
any Seller Party or any Affiliate thereof to pay to the related Obligor
any rebate or refund, or
(iv) the Outstanding Balance of any Receivable originated by an
Approved Business Unit is less than the amount included in calculating
the Net Pool Balance for purposes of any Monthly Report (for any reason
other than such Receivable becoming a Defaulted Receivable), or
(v) any of the representations or warranties of Seller set
forth in Section 5.1(g), (i), (j), (r), (s), (t) or (u) were not true
when made with respect to any Receivable originated by an Approved
Business Unit, or any Receivable originated by an Approved Business
Unit is repurchased by an Originator pursuant to the Receivables Sale
Agreement,
then, on such day, Seller shall be deemed to have received a Collection of such
Receivable (A) in the case of clauses (i)-(iv) above, in the amount of such
reduction or cancellation or the difference between the actual Outstanding
Balance and the amount included in calculating such Net Pool Balance, as
applicable; and (B) in the case of clause (v) above, in the amount of the
Outstanding Balance of such Receivable and, not later than the next Settlement
Date thereafter shall pay to the Agent's Account the amount of any such
Collection deemed to have been received.
(b) Seller shall ensure that the Aggregate Invested Amount shall at
no time prior to the occurrence of an Amortization Event exceed the Purchase
Limit. If at any time the Aggregate Invested Amount exceeds the Purchase Limit,
Seller shall pay to the Agent immediately an amount to be applied to reduce the
Aggregate Invested Amount (as allocated by the Agent), such that after giving
effect to such payment the Aggregate Invested Amount is less than or equal to
the Purchase Limit.
(c) Seller shall also ensure that the Receivable Interests shall at
no time prior to the occurrence of an Amortization Event exceed in the aggregate
100%. If the aggregate of the Receivable Interests exceeds 100%, Seller shall
pay to the Agent on or before the next succeeding Settlement Date (or, if such
excess is discovered on a Settlement Date, on such Settlement Date) an amount to
be applied to reduce the Aggregate Invested Amount (as allocated by the Agent),
such that after giving effect to such payment the aggregate of the Receivable
Interests equals or is less than 100%.
Section 1.5 Payment Requirements and Computations. All amounts to
be paid or deposited by any Seller Party pursuant to any provision of this
Agreement shall be paid or deposited in accordance with the terms hereof no
later than 12:00 noon (New York
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time) on the day when due in immediately available funds, and if not received
before 12:00 noon (New York time) shall be deemed to be received on the next
succeeding Business Day. If such amounts are payable to the Agent for the
account of Blue Ridge, they shall be paid to the Agent's Account, for the
account of Blue Ridge until otherwise notified by the Agent. All computations of
CP Costs, Yield, per annum fees calculated as part of any CP Costs, per annum
fees hereunder and per annum fees under the Fee Letter shall be made on the
basis of a year of 360 days for the actual number of days elapsed. If any amount
hereunder shall be payable on a day which is not a Business Day, such amount
shall be payable on the next succeeding Business Day.
ARTICLE II.
PAYMENTS AND COLLECTIONS
Section 2.1 Payments of Recourse Obligations. Seller hereby promises to
pay the following (collectively, the
"RECOURSE OBLIGATIONS"):
(a) all amounts due and owing under Sections 1.3, 1.4 or 2.4 on
the dates specified therein;
(b) the fees set forth in the Fee Letter on the dates specified
therein;
(c) all accrued and unpaid Yield on the Receivable Interests
accruing Yield at the Alternate Base Rate or the Default Rate on each
Settlement Date applicable thereto;
(d) all accrued and unpaid Yield on the Receivable Interests
accruing Yield at the LIBO Rate on the last day of each Interest Period
applicable thereto;
(e) all accrued and unpaid CP Costs on the Receivable Interests
funded with Commercial Paper on each Settlement Date; and
(f) all Broken Funding Costs and Indemnified Amounts upon demand.
Section 2.2 Collections Prior to the Facility Termination Date;
Repayment of Certain Demand Advances.
(a) Prior to the Facility Termination Date, (i) any Deemed
Collections received by the Servicer and (ii) Blue Ridge's Portion of any
Collections received by the Servicer shall be set aside and held in trust
by the Servicer for the payment of any accrued and unpaid Aggregate Unpaids
or for a Reinvestment as provided in this Section 2.2. If at any time any
Collections are received by the Servicer prior to the Facility Termination
Date, Seller hereby requests and Blue Ridge hereby agrees to make,
simultaneously with such receipt, a reinvestment (each, a "REINVESTMENT")
with Blue Ridge's Portion of the balance of each and every Collection
received by the Servicer such that after giving effect to such
Reinvestment, the Invested Amount of such Receivable Interest immediately
after such receipt and corresponding Reinvestment shall be equal to the
amount of Invested Amount immediately prior to such receipt.
(b) On each Settlement Date prior to the Facility Termination Date,
the Servicer shall remit to the Agent's Account the amounts set aside
during the preceding Settlement Period that have not been subject to a
Reinvestment and (after deduction of its
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Servicing Fee) apply such amounts (if not previously paid in accordance
with Section 2.1) to the Aggregate Unpaids in the order specified:
FIRST, ratably to the payment of all accrued and unpaid CP Costs,
Yield and Broken Funding Costs (if any) that are then due and owing,
SECOND, ratably to the payment of all accrued and unpaid fees under
the Fee Letter (if any) that are then due and owing,
THIRD, if required under Section 1.3 or 1.4, to the ratable
reduction of Aggregate Invested Amount,
FOURTH, for the ratable payment of all other unpaid Recourse
Obligations, if any, that are then due and owing, and
FIFTH, the balance, if any, to Seller or otherwise in accordance
with Seller's instructions.
(c) If the Collections are insufficient to pay the Servicing Fee
and the Aggregate Unpaids specified above on any Settlement Date, Seller shall
make demand upon Tower for repayment of any outstanding Demand Advances in an
aggregate amount equal to the lesser of (i) the amount of such shortfall in
Collections, and (ii) the aggregate outstanding principal balance of the Demand
Advances, together with all accrued and unpaid interest thereon, and Tower
hereby agrees to pay such amount to the Agent's Account on such Settlement Date.
Section 2.3 Repayment of Demand Advances on the Facility Termination
Date; Collections.
(a) On the Facility Termination Date, Tower hereby agrees to repay the
aggregate outstanding principal balance of all Demand Advances, together with
all accrued and unpaid interest thereon, to the Agent's Account, without demand
or notice of any kind, all of which are hereby expressly waived by Tower.
(b) On the Facility Termination Date and on each day thereafter, the
Servicer shall set aside and hold in trust, for the Secured Parties, all
Collections received on each such day. On and after the Facility Termination
Date, the Servicer shall, on each Settlement Date and on each other Business Day
specified by the Agent (after deduction of any accrued and unpaid Servicing Fee
as of such date): (i) remit to the Agent's Account the amounts set aside
pursuant to the preceding two sentences, and (ii) apply such amounts to reduce
the Aggregate Unpaids as follows:
FIRST, to the reimbursement of the Agent's costs of collection and
enforcement of this Agreement,
SECOND, ratably to the payment of all accrued and unpaid CP Costs,
Yield and Broken Funding Costs,
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THIRD, ratably to the payment of all accrued and unpaid fees under
the Fee Letter,
FOURTH, to the ratable reduction of Aggregate Invested Amount,
FIFTH, for the ratable payment of all other Aggregate Unpaids, and
SIXTH, after the Final Payout Date, to Seller.
Section 2.4 Payment Rescission. No payment of any of the Aggregate
Unpaids shall be considered paid or applied hereunder to the extent that, at any
time, all or any portion of such payment or application is rescinded by
application of law or judicial authority, or must otherwise be returned or
refunded for any reason. Seller shall remain obligated for the amount of any
payment or application so rescinded, returned or refunded, and shall promptly
pay to the Agent (for application to the Person or Persons who suffered such
rescission, return or refund) the full amount thereof, plus interest thereon at
the Default Rate from the date of any such rescission, return or refunding;
PROVIDED, HOWEVER, that Seller shall not be obligated to make any such payment
to the Agent to the extent that such rescission, return or refund arises in a
bankruptcy or insolvency proceeding of an Obligor.
Section 2.5 Clean Up Call. In addition to Seller's rights pursuant to
Section 1.3, Seller shall have the right (after providing written notice to the
Agent in accordance with the Required Notice Period), at any time following the
reduction of the Aggregate Invested Amount to a level that is less than 10.0% of
the original Purchase Limit, to repurchase all, but not less than all, of the
then outstanding Receivable Interests. The purchase price in respect thereof
shall be an amount equal to the Aggregate Unpaids through the date of such
repurchase, payable in immediately available funds to the Agent's Account. Such
repurchase shall be without representation, warranty or recourse of any kind by,
on the part of, or against Blue Ridge or the Agent.
ARTICLE III.
COMMERCIAL PAPER FUNDING
Section 3.1 CP Costs. Seller shall pay CP Costs allocable to the
Invested Amount of all Receivable Interests funded through the issuance of
Commercial Paper for each day that any Invested Amount in respect of such
Receivable Interests are outstanding. Each Receivable Interest that is funded
substantially with Pooled Commercial Paper will accrue CP Costs each day on a
pro rata basis, based upon the percentage share that the Invested Amount in
respect of such Receivable Interest represents in relation to all assets held by
Blue Ridge and funded substantially with related Pooled Commercial Paper.
Section 3.2 Calculation of CP Costs. Not later than the 3rd Business
Day immediately preceding each Monthly Reporting Date, Blue Ridge shall
calculate the aggregate amount of CP Costs applicable to its Receivable
Interests for the Calculation Period then most recently ended and shall notify
Seller of such aggregate amount.
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Section 3.3 CP Costs Payments. On each Settlement Date following
Seller's receipt of the notice delivered pursuant to Section 3.2, Seller shall
pay to the Agent (for the benefit of Blue Ridge) an aggregate amount equal to
all accrued and unpaid CP Costs allocable to the Invested Amount of all
Receivable Interests funded with Commercial Paper for the Calculation Period
then most recently ended in accordance with Article II.
Section 3.4 Default Rate. From and after the occurrence of an
Amortization Event, all Receivable Interests shall accrue Yield at the Default
Rate.
ARTICLE IV.
LIQUIDITY FUNDINGS
Section 4.1 Liquidity Fundings. Prior to the occurrence of an
Amortization Event, the outstanding Invested Amount of each Receivable Interest
funded with a Liquidity Funding shall accrue Yield for each day during its
Interest Period at either the LIBO Rate or the Alternate Base Rate in accordance
with the terms and conditions hereof. Until Seller gives the required notice to
the Agent of another Yield Rate in accordance with Section 4.4, the initial
Yield Rate for any Receivable Interest funded with a Liquidity Funding shall be
the Alternate Base Rate (unless the Default Rate is then applicable). If any
undivided interest in a Receivable Interest initially funded with Commercial
Paper is sold to the Liquidity Banks pursuant to the Liquidity Agreement, such
undivided interest in such Receivable Interest shall be deemed to have a
Interest Period commencing on the date of such sale.
Section 4.2 Yield Payments. On the Settlement Date for each Receivable
Interest that is funded with a Liquidity Funding, Seller shall pay to the Agent
(for the benefit of the Liquidity Banks) an aggregate amount equal to the
accrued and unpaid Yield thereon for the entire Interest Period of each such
Liquidity Funding in accordance with Article II.
Section 4.3 Selection and Continuation of Interest Periods.
(a) With consultation from (and approval by) the Agent, Seller
shall from time to time request Interest Periods for the Receivable Interests
funded with Liquidity Fundings, PROVIDED THAT if at any time any Liquidity
Funding is outstanding, Seller shall always request Interest Periods such that
at least one Interest Period shall end on the date specified in clause (A) of
the definition of Settlement Date.
(b) Seller or the Agent, upon notice to and consent by the other
received at least three (3) Business Days prior to the end of an Interest Period
(the "TERMINATING TRANCHE") for any Liquidity Funding, may, effective on the
last day of the Terminating Tranche: (i) divide any such Liquidity Funding into
multiple Liquidity Fundings, (ii) combine any such Liquidity Funding with one or
more other Liquidity Fundings that have a Terminating Tranche ending on the same
day as such Terminating Tranche or (iii) combine any such Liquidity Funding with
a new Liquidity Funding to be made by the Liquidity Banks on the day such
Terminating Tranche ends.
Section 4.4 Liquidity Funding Yield Rates. Seller may select the LIBO
Rate (subject to Section 4.5 below) or the Alternate Base Rate for each
Liquidity Funding. Seller shall by
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12:00 noon (New York time): (i) at least three (3) Business Days prior to the
expiration of any Terminating Tranche with respect to which the LIBO Rate is
being requested as a new Yield Rate and (ii) at least one (1) Business Day prior
to the expiration of any Terminating Tranche with respect to which the Alternate
Base Rate is being requested as a new Yield Rate, give the Agent irrevocable
notice of the new Yield Rate for the Liquidity Funding associated with such
Terminating Tranche. Until Seller gives notice to the Agent of another Yield
Rate, the initial Yield Rate for any Receivable Interest assigned or
participated to the Liquidity Banks pursuant to the Liquidity Agreement shall be
the Alternate Base Rate (unless the Default Rate is then applicable).
Section 4.5 Suspension of the LIBO Rate.
(a) If any Liquidity Bank notifies the Agent that it has determined
that funding its ratable share of the Liquidity Fundings at a LIBO Rate would
violate any applicable law, rule, regulation, or directive of any governmental
or regulatory authority, whether or not having the force of law, or that (i)
deposits of a type and maturity appropriate to match fund its Liquidity Funding
at such LIBO Rate are not available or (ii) such LIBO Rate does not accurately
reflect the cost of acquiring or maintaining a Liquidity Funding at such LIBO
Rate, then the Agent shall suspend the availability of such LIBO Rate and
require Seller to select the Alternate Base Rate for any Liquidity Funding
accruing Yield at such LIBO Rate.
(b) If less than all of the Liquidity Banks give a notice to
the Agent pursuant to Section 4.5(a), each Liquidity Bank which gave such a
notice shall be obliged, at the request of Seller, Blue Ridge or the Agent, to
assign all of its rights and obligations hereunder to (i) another Liquidity Bank
or (ii) another funding entity nominated by Seller or the Agent that is an
Eligible Assignee willing to participate in the Liquidity Agreement through the
Liquidity Termination Date in the place of such notifying Liquidity Bank;
PROVIDED THAT (i) the notifying Liquidity Bank receives payment in full of all
Aggregate Unpaids owing to it (whether due or accrued), and (ii) the replacement
Liquidity Bank otherwise satisfies the requirements of the Liquidity Agreement.
Section 4.6 Default Rate. From and after the occurrence of an
Amortization Event, all Liquidity Fundings shall accrue Yield at the Default
Rate.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of the Seller Parties. Each
Seller Party hereby represents and warrants to the Agent and Blue Ridge, as to
itself, as of the date hereof and as of the date of each Incremental Purchase
and the date of each Reinvestment that:
(a) Existence and Power. Such Seller Party's jurisdiction of
organization is correctly set forth in the preamble to this Agreement. Such
Seller Party is duly organized under the laws of that jurisdiction and no other
state or jurisdiction, and such jurisdiction must maintain a public record
showing the organization to have been organized. Such Seller Party is validly
existing and in good standing under the laws of its state of organization. Such
Seller Party is
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duly qualified to do business and is in good standing as a foreign entity, and
has and holds all organizational power and all governmental licenses,
authorizations, consents and approvals required to carry on its business in each
jurisdiction in which its business is conducted except where the failure to so
qualify or so hold could not reasonably be expected to have a Material Adverse
Effect.
(b) Power and Authority; Due Authorization, Execution and Delivery.
The execution and delivery by such Seller Party of this Agreement and each other
Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder and, in the case of Seller, Seller's use of
the proceeds of Purchases made hereunder, are within its corporate powers and
authority and have been duly authorized by all necessary corporate action on its
part. This Agreement and each other Transaction Document to which such Seller
Party is a party has been duly executed and delivered by such Seller Party.
(c) No Conflict. The execution and delivery by such Seller Party of
this Agreement and each other Transaction Document to which it is a party, and
the performance of its obligations hereunder and thereunder do not contravene or
violate (i) its certificate or articles of incorporation or by-laws or other
applicable organizational documents, (ii) any law, rule or regulation applicable
to it, (iii) any restrictions under any agreement, contract or instrument to
which it is a party or by which it or any of its property is bound, or (iv) any
order, writ, judgment, award, injunction or decree binding on or affecting it or
its property, and do not result in the creation or imposition of any Adverse
Claim on assets of such Seller Party or its Subsidiaries (except as created
hereunder) except, in any case, where such contravention or violation could not
reasonably be expected to have a Material Adverse Effect; and no transaction
contemplated hereby requires compliance with any bulk sales act or similar law.
(d) Governmental Authorization. Other than the filing of the
financing statements required hereunder, no authorization or approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution and delivery by such Seller
Party of this Agreement and each other Transaction Document to which it is a
party and the performance of its obligations hereunder and thereunder.
(e) Actions, Suits. There are no actions, suits or proceedings
pending, or to the best of such Seller Party's knowledge, threatened, against or
affecting such Seller Party, or any of its properties, in or before any court,
arbitrator or other body, that could reasonably be expected to have a Material
Adverse Effect. Such Seller Party is not in default with respect to any order of
any court, arbitrator or governmental body.
(f) Binding Effect. This Agreement and each other Transaction
Document to which such Seller Party is a party constitute the legal, valid and
binding obligations of such Seller Party enforceable against such Seller Party
in accordance with their respective terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(g) Accuracy of Information. All information heretofore furnished
by such Seller Party or any of its Affiliates to the Agent or Blue Ridge for
purposes of or in connection
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with this Agreement, any of the other Transaction Documents or any transaction
contemplated hereby or thereby is, and all such information hereafter furnished
by such Seller Party or any of its Affiliates to the Agent or Blue Ridge will
be, true and accurate in every material respect on the date such information is
stated or certified and does not and will not contain any material misstatement
of fact or omit to state a material fact or any fact necessary to make the
statements contained therein not misleading.
(h) Use of Proceeds. No proceeds of any Purchase hereunder will be
used (i) for a purpose that violates, or would be inconsistent with, (A) Section
7.2(e) of this Agreement or (B) Regulation T, U or X promulgated by the Board of
Governors of the Federal Reserve System from time to time or (ii) to acquire any
security in any transaction which is subject to Section 12, 13 or 14 of the
Securities Exchange Act of 1934, as amended.
(i) Good Title. Seller is the legal and beneficial owner of the
Receivables and Related Security with respect thereto, free and clear of any
Adverse Claim, except as created by the Transaction Documents. There have been
duly filed all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect Seller's ownership interest in each Receivable, its Collections and
the Related Security.
(j) Perfection. This Agreement is effective to create a valid
security interest in favor of the Agent for the benefit of the Secured Parties
in the Purchased Assets to secure payment of the Aggregate Unpaids, free and
clear of any Adverse Claim except as created by the Transactions Documents.
There have been duly filed all financing statements or other similar instruments
or documents necessary under the UCC (or any comparable law) of all appropriate
jurisdictions to perfect the Agent's (on behalf of the Secured Parties) security
interest in the Purchased Assets. Such Seller Party's jurisdiction of
organization is a jurisdiction whose law generally requires information
concerning the existence of a nonpossessory security interest to be made
generally available in a filing, record or registration system as a condition or
result of such a security interest's obtaining priority over the rights of a
lien creditor which respect to collateral.
(k) Places of Business and Locations of Records. The principal
places of business and chief executive office of such Seller Party and the
offices where it keeps all of its Records are located at the address(es) listed
on Exhibit III or such other locations of which the Agent has been notified in
accordance with Section 7.2(a) in jurisdictions where all action required by
Section 13.3(a) has been taken and completed. Seller's Federal Employer
Identification Number is correctly set forth on Exhibit III.
(l) Collections. The conditions and requirements set forth in
Section 7.1(j) and Section 8.2 have at all times been satisfied and duly
performed. The names, addresses and jurisdictions of organization of all
Collection Banks, together with the account numbers of the Collection Accounts
of Seller at each Collection Bank and the post office box number of each
Lock-Box, are listed on Exhibit IV. Seller has not granted any Person, other
than the Agent as contemplated by this Agreement, dominion and control of any
Lock-Box or Collection Account, or the right to take dominion and control of any
such Lock-Box or Collection Account at a future time or upon the occurrence of a
future event.
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(m) Material Adverse Effect. (i) The initial Servicer represents
and warrants that since December 31, 2000, no event has occurred that would have
a material adverse effect on the financial condition or operations of the
initial Servicer and its Subsidiaries, taken as a whole, or the ability of the
initial Servicer to perform its obligations under this Agreement, and (ii)
Seller represents and warrants that since the date of this Agreement, no event
has occurred that would have a material adverse effect on (A) the financial
condition or operations of Seller, (B) the ability of Seller to perform its
obligations under the Transaction Documents, or (C) the collectibility of the
Receivables generally or any material portion of the Receivables.
(n) Names. The name in which Seller has executed this Agreement is
identical to the name of Seller as indicated on the public record of its state
of organization which shows Seller to have been organized. In the past five (5)
years, Seller has not used any corporate names, trade names or assumed names
other than the name in which it has executed this Agreement.
(o) Ownership of Seller. Performance Guarantor owns, directly or
indirectly, 100% of the issued and outstanding capital stock or other applicable
equity interests of Seller, free and clear of any Adverse Claim. Such capital
stock or other applicable equity interests is validly issued, fully paid and
nonassessable, and there are no options, warrants or other rights to acquire
securities of Seller.
(p) Not a Holding Company or an Investment Company. Such Seller
Party is not a "holding company" or a "subsidiary holding company" of a "holding
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended, or any successor statute. Such Seller Party is not an "investment
company" within the meaning of the Investment Company Act of 1940, as amended,
or any successor statute.
(q) Compliance with Law. Such Seller Party has complied in all
respects with all applicable laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject, except where the
failure to so comply could not reasonably be expected to have a Material Adverse
Effect. Each Receivable, together with the Contract related thereto, does not
contravene any laws, rules or regulations applicable thereto (including, without
limitation, laws, rules and regulations relating to truth in lending, fair
credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy), and no part of such Contract is in violation
of any such law, rule or regulation, except where such contravention or
violation could not reasonably be expected to have a Material Adverse Effect.
(r) Compliance with Credit and Collection Policy. Such Seller Party
has complied in all material respects with the Credit and Collection Policy with
regard to each Receivable and the related Contract, and has not made any
material change to such Credit and Collection Policy, except such material
change as to which the Agent has been notified in accordance with Section
7.1(a)(vii).
(s) Payments to Applicable Originator. With respect to each
Receivable transferred to Seller under the Receivables Sale Agreement, Seller
has given reasonably equivalent value to the applicable Originator in
consideration therefor and such transfer was not made for or on account of an
antecedent debt. No transfer by any Originator of any Receivable
11
under the Receivables Sale Agreement is or may be voidable under any section of
the Bankruptcy Reform Act of 1978 (11 U.S.C.ss.ss.101 et seq.), as amended.
(t) Enforceability of Contracts. Each Contract with respect to each
Receivable is effective to create, and has created, a legal, valid and binding
obligation of the related Obligor to pay the Outstanding Balance of the
Receivable created thereunder and any accrued interest thereon, enforceable
against the Obligor in accordance with its terms, except as such enforcement may
be limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(u) Eligible Receivables. Each Receivable included in the Net Pool
Balance as an Eligible Receivable on the date of any Monthly Report was an
Eligible Receivable on such date.
(v) Purchase Limit and Maximum Receivable Interests. Immediately
after giving effect to each Incremental Purchase hereunder and prior to the
occurrence of an Amortization Event, (i) the Aggregate Invested Amount is less
than or equal to the Purchase Limit and (ii) the aggregate of the Receivable
Interests does not exceed 100%.
(w) Accounting. The manner in which such Seller Party accounts for
the transactions contemplated by this Agreement and the Receivables Sale
Agreement does not jeopardize the true sale analysis.
ARTICLE VI.
CONDITIONS OF PURCHASES
Section 6.1 Conditions Precedent to Initial Incremental Purchase. The
initial Incremental Purchase of a Receivable Interest under this Agreement is
subject to the conditions precedent that (a) the Agent shall have received on or
before the date of such Purchase those documents listed on Schedule A and (b)
the Agent shall have received all fees and expenses required to be paid on such
date pursuant to the terms of this Agreement and the Fee Letter.
Section 6.2 Conditions Precedent to All Purchases and Reinvestments.
Each Incremental Purchase and each Reinvestment shall be subject to the further
conditions precedent that (a) in the case of each such Purchase: (i) the
Servicer shall have delivered to the Agent on or prior to the date of such
Purchase, in form and substance satisfactory to the Agent, all Monthly Reports
as and when due under Section 8.5 and (ii) upon the Agent's request, the
Servicer shall have delivered to the Agent at least three (3) days prior to such
Purchase an interim Monthly Report showing the amount of Eligible Receivables;
(b) the Agent shall have received such other approvals, opinions or documents as
it may reasonably request and (c) on each Purchase Date, the following
statements shall be true (and acceptance of the proceeds of such Incremental
Purchase or Reinvestment shall be deemed a representation and warranty by Seller
that such statements are then true):
(i) the representations and warranties set forth in Section 5.1
are true and correct in all material respects on and as of the date of
such Incremental Purchase or
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Reinvestment as though made on and as of such Purchase Date; provided,
that the materiality threshold in the preceding clause shall not be
applicable with respect to any representation or warranty which itself
contains a materiality threshold;
(ii) no event has occurred and is continuing, or would result
from such Incremental Purchase or Reinvestment, that will constitute an
Amortization Event, and no event has occurred and is continuing, or
would result from such Incremental Purchase or Reinvestment, that would
constitute an Unmatured Amortization Event; and
(iii) prior to the occurrence of an Amortization Event (A) the
Aggregate Invested Amount does not exceed the Purchase Limit and (B)
the aggregate Receivable Interests do not exceed 100%.
It is expressly understood that each Reinvestment shall, unless otherwise
directed by the Agent or Blue Ridge, occur automatically on each day that the
Servicer shall receive any Collections without the requirement that any further
action be taken on the part of any Person and notwithstanding the failure of
Seller to satisfy any of the foregoing conditions precedent in respect of such
Reinvestment. The failure of Seller to satisfy any of the foregoing conditions
precedent in respect of any Reinvestment shall give rise to a right of the
Agent, which right may be exercised at any time on demand of the Agent, to
rescind the related purchase and direct Seller to pay to the Agent's Account,
for the benefit of Blue Ridge, an amount equal to the Collections prior to the
Facility Termination Date that shall have been applied to the affected
Reinvestment.
ARTICLE VII.
COVENANTS
Section 7.1 Affirmative Covenants of the Seller Parties. Until the date
on which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself, as set forth below:
(a) Financial Reporting. Such Seller Party will maintain, for
itself and each of its Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish or cause to be furnished to
the Agent:
(i) Annual Reporting. Within 120 days (A) after the close of
each fiscal year of Parent, audited, unqualified consolidated financial
statements (which shall include balance sheets, statements of income
and retained earnings and a statement of cash flows) for Parent for
such fiscal year certified in a manner acceptable to the Agent by
independent public accountants reasonably acceptable to the Agent; and
(B) after the close of Seller's fiscal year, unaudited financial
statements (which shall include balance sheets, statements of income
and retained earnings and a statement of cash flows) for Seller for
such fiscal year certified by its chief financial officer
(ii) Quarterly Reporting. Within 60 days after the close of the
first three (3) quarterly periods (A) of each fiscal year of Parent,
unaudited consolidated
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balance sheets of Parent as at the close of each such period and
unaudited consolidated statements of income and retained earnings and a
statement of cash flows for Parent for the period from the beginning of
such fiscal year to the end of such quarter, all certified by its
respective chief financial officer and (B) of Seller's fiscal year,
balance sheets of Seller as of the close of each such period and
statements of income and retained earnings and a statement of cash
flows for the Seller for the period from the beginning of such fiscal
year to the end of such quarter certified by Seller's chief financial
officer.
(iii) Compliance Certificate. Together with the financial
statements required hereunder, a compliance certificate in
substantially the form of Exhibit V signed by such Seller Party's
Authorized Officer and dated the date of such annual financial
statement or such quarterly financial statement, as the case may be.
(iv) Shareholders Statements and Reports. Promptly upon the
furnishing thereof to the shareholders of such Seller Party copies of
all financial statements, reports and proxy statements so furnished.
(v) S.E.C. Filings. Promptly upon the filing thereof, copies of
all registration statements and annual, quarterly, monthly or other
regular reports which any Seller Party or any of its Affiliates files
with the Securities and Exchange Commission.
(vi) Copies of Notices. Promptly upon its receipt of any
notice, request for consent, financial statements, certification,
report or other communication under or in connection with any
Transaction Document from any Person other than the Agent or Blue
Ridge, copies of the same.
(vii) Change in Credit and Collection Policy. At least thirty
(30) days prior to the effectiveness of any material change in or
material amendment to the Credit and Collection Policy, a copy of the
Credit and Collection Policy then in effect and a notice (A) indicating
such material change or amendment, and (B) if such proposed material
change or amendment would be reasonably likely to adversely affect the
collectibility of the Receivables or materially decrease the credit
quality of any newly created Receivables, requesting the Agent's
consent thereto.
(viii) Other Information. Promptly, from time to time, such
other information, documents, records or reports relating to the
Receivables or the condition or operations, financial or otherwise, of
such Seller Party as the Agent may from time to time reasonably request
in order to protect the interests of the Agent, for the benefit of Blue
Ridge, under or as contemplated by this Agreement.
(b) Notices. Such Seller Party will notify the Agent in writing of
any of the following promptly upon learning of the occurrence thereof,
describing the same and, if applicable, the steps being taken with
respect thereto:
(i) Amortization Events or Unmatured Amortization Events. The
occurrence of each Amortization Event and each Unmatured Amortization
Event, by a statement of an Authorized Officer of such Seller Party.
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(ii) Judgments and Proceedings. (A) (1) The entry of any
judgment or decree against Performance Guarantor, the Servicer or any
of their respective Subsidiaries if the aggregate amount of all
judgments and decrees then outstanding against Performance Guarantor,
the Servicer and their respective Subsidiaries exceeds $10,000,000
after deducting (a) the amount with respect to which Performance
Guarantor, the Servicer or any such Subsidiary, as the case may be, is
insured and with respect to which the insurer has assumed
responsibility in writing, and (b) the amount for which Performance
Guarantor, the Servicer or any such Subsidiary is otherwise indemnified
if the terms of such indemnification are satisfactory to the Agent, and
(2) the institution of any litigation, arbitration proceeding or
governmental proceeding against Performance Guarantor or the Servicer
which, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect; and (B) the entry of any judgment or
decree or the institution of any litigation, arbitration proceeding or
governmental proceeding against Seller.
(iii) Material Adverse Effect. The occurrence of any event or
condition that has had, or could reasonably be expected to have, a
Material Adverse Effect.
(iv) Termination Date. The occurrence of the "TERMINATION DATE"
under and as defined in the Receivables Sale Agreement.
(v) Defaults Under Other Agreements. The occurrence of a
default or an event of default under any other financing arrangement
involving Indebtedness in excess of $10,000,000 pursuant to which such
Seller Party is a debtor or an obligor.
(vi) Notices under Receivables Sale Agreement. Copies of all
notices delivered under the Receivables Sale Agreement.
(vii) Downgrade of Performance Guarantor. Any downgrade in the
rating of any Indebtedness of Performance Guarantor by S&P or Xxxxx'x,
setting forth the Indebtedness affected and the nature of such change.
(c) Compliance with Laws and Preservation of Corporate Existence.
Such Seller Party will comply in all respects with all applicable laws,
rules, regulations, orders, writs, judgments, injunctions, decrees or
awards to which it may be subject, except where the failure to so
comply could not reasonably be expected to have a Material Adverse
Effect. Such Seller Party will preserve and maintain its corporate
existence, rights, franchises and privileges in the jurisdiction of its
incorporation, and qualify and remain qualified in good standing as a
foreign corporation in each jurisdiction where its business is
conducted, except where the failure to so preserve and maintain or
qualify could not reasonably be expected to have a Material Adverse
Effect.
(d) Audits. Such Seller Party will, from time to time during
regular business hours as requested by the Agent, and prior to the
occurrence of an Amortization Event upon at least thirty (30) days
prior notice, and at the sole cost of such Seller Party, permit the
Agent, or its agents or representatives (and shall cause each
Originator to permit the Agent or its agents or representatives): (i)
to examine and make copies of and abstracts from all Records in the
15
possession or under the control of such Person relating to the
Purchased Assets, including, without limitation, the related Contracts,
and (ii) to visit the offices and properties of such Person for the
purpose of examining such materials described in clause (i) above, and
to discuss matters relating to such Person's financial condition or the
Purchased Assets or any Person's performance under any of the
Transaction Documents or any Person's performance under the Contracts
and, in each case, with any of the officers or employees of Seller or
the Servicer having knowledge of such matters (each of the foregoing
examinations and visits, a "REVIEW"); PROVIDED, HOWEVER, that, so long
as no Amortization Event has occurred and is continuing, (A) the Seller
Parties shall only be responsible for the costs and expenses of one (1)
Review in any one calendar year, and (B) the Agent will not request
more than two (2) Reviews in any one calendar year.
(e) Keeping and Marking of Records and Books.
(i) The Servicer will (and will cause each Originator to)
maintain and implement administrative and operating procedures
(including, without limitation, an ability to recreate records
evidencing Receivables in the event of the destruction of the originals
thereof), and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit
the immediate identification of each new Receivable and all Collections
of and adjustments to each existing Receivable). The Servicer will (and
will cause each Originator to) give the Agent notice of any material
change in the administrative and operating procedures referred to in
the previous sentence.
(ii) Such Seller Party will (and will cause each Originator
to): (A) on or prior to the date hereof, xxxx its master data
processing records and other books and records relating to the
Receivables with a legend, acceptable to the Agent, describing the
Agent's security interest in the Purchased Assets and (B) upon the
request of the Agent following the occurrence of an Amortization Event:
(x) xxxx each Contract with a legend describing the Agent's security
interest and (y) deliver to the Agent all Contracts, including all
multiple originals of any such Contract, if any, constituting an
instrument, a certificated security or chattel paper relating to the
Receivables.
(f) Compliance with Contracts and Credit and Collection Policy.
Such Seller Party will (and will cause each Originator to) timely and fully (i)
perform and comply with all provisions, covenants and other promises required to
be observed by it under the Contracts related to the Receivables, and (ii)
comply in all material respects with the Credit and Collection Policy in regard
to each Receivable and the related Contract.
(g) Performance and Enforcement of Receivables Sale Agreement.
Seller will, and will require each Originator to, perform each of their
respective obligations and undertakings under and pursuant to the Receivables
Sale Agreement, will purchase Receivables thereunder in strict compliance with
the terms thereof and will strictly enforce the rights and remedies accorded to
Seller under the Receivables Sale Agreement. Seller will take all actions to
perfect and enforce its rights and interests (and the rights and interests of
the Agent, as Seller's assignee) under the Receivables Sale Agreement as the
Agent may from time to time reasonably
16
request, including, without limitation, making claims to which it may be
entitled under any indemnity, reimbursement or similar provision contained in
the Receivables Sale Agreement.
(h) Ownership. Seller will (or will cause each Originator to) take
all necessary action to (i) vest legal and equitable title to the Purchased
Assets purchased under the Receivables Sale Agreement irrevocably in Seller,
free and clear of any Adverse Claims (other than Adverse Claims in favor of the
Agent, for the benefit of the Secured Parties) including, without limitation,
the filing of all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect Seller's interest in such Purchased Assets and such other action to
perfect, protect or more fully evidence the interest of Seller therein as the
Agent may reasonably request), and (ii) establish and maintain, in favor of the
Agent, for the benefit of the Secured Parties, a valid and perfected first
priority security interest in all Purchased Assets, free and clear of any
Adverse Claims, including, without limitation, the filing of all financing
statements or other similar instruments or documents necessary under the UCC (or
any comparable law) of all appropriate jurisdictions to perfect the Agent's (for
the benefit of the Secured Parties) security interest in the Purchased Assets
and such other action to perfect, protect or more fully evidence the interest of
the Agent for the benefit of the Secured Parties as the Agent may reasonably
request.
(i) Reliance. Seller acknowledges that the Agent and Blue Ridge are
entering into the transactions contemplated by this Agreement in reliance upon
Seller's identity as a legal entity that is separate from each Originator.
Therefore, from and after the date of execution and delivery of this Agreement,
Seller shall take all reasonable steps, including, without limitation, all steps
that the Agent or Blue Ridge may from time to time reasonably request, to
maintain Seller's identity as a separate legal entity and to make it manifest to
third parties that Seller is an entity with assets and liabilities distinct from
those of each Originator and any Affiliates thereof (other than Seller) and not
just a division of any Originator or any such Affiliate. Without limiting the
generality of the foregoing and in addition to the other covenants set forth
herein, Seller will:
(A) conduct its own business in its own name and require that
all full-time employees of Seller, if any, identify themselves as
such and not as employees of any Originator (including, without
limitation, by means of providing appropriate employees with
business or identification cards identifying such employees as
Seller's employees);
(B) compensate all employees, consultants and agents directly,
from Seller's own funds, for services provided to Seller by such
employees, consultants and agents and, to the extent any employee,
consultant or agent of Seller is also an employee, consultant or
agent of any Originator or any Affiliate thereof, allocate the
compensation of such employee, consultant or agent between Seller
and such Originator or such Affiliate, as applicable, on a basis
that reflects the services rendered to Seller and such Originator
or such Affiliate, as applicable;
(C) clearly identify its offices (by signage or otherwise) as
its offices and, if such office is located in the offices of any
Originator, Seller shall lease such office at a fair market rent;
17
(D) have a separate telephone number, which will be answered
only in its name and separate stationery and checks in its own
name;
(E) conduct all transactions with each Originator and the
Servicer (including, without limitation, any delegation of its
obligations hereunder as Servicer) strictly on an arm's-length
basis, allocate all overhead expenses (including, without
limitation, telephone and other utility charges) for items shared
between Seller and such Originator on the basis of actual use to
the extent practicable and, to the extent such allocation is not
practicable, on a basis reasonably related to actual use;
(F) at all times have a Board of Directors consisting of three
members, at least one member of which is an Independent Director;
(G) observe all corporate formalities as a distinct entity, and
ensure that all corporate actions relating to (A) the selection,
maintenance or replacement of the Independent Director, (B) the
dissolution or liquidation of Seller or (C) the initiation of,
participation in, acquiescence in or consent to any bankruptcy,
insolvency, reorganization or similar proceeding involving Seller,
are duly authorized by unanimous vote of its Board of Directors
(including the Independent Director);
(H) maintain Seller's books and records separate from those of
each Originator and any Affiliate thereof and otherwise readily
identifiable as its own assets rather than assets of any Originator
or any Affiliate thereof;
(I) prepare its financial statements separately from those of
each Originator and insure that any consolidated financial
statements of any Originator or any Affiliate thereof that include
Seller and that are filed with the Securities and Exchange
Commission or any other governmental agency have notes clearly
stating that Seller is a separate corporate entity and that its
assets will be available first and foremost to satisfy the claims
of the creditors of Seller;
(J) except as herein specifically otherwise provided, maintain
the funds or other assets of Seller separate from, and not
commingled with, those of any Originator or any Affiliate thereof
and only maintain bank accounts or other depository accounts to
which Seller alone is the account party, into which Seller alone
makes deposits and from which Seller alone (or the Agent hereunder)
has the power to make withdrawals;
(K) pay all of Seller's operating expenses from Seller's own
assets (except for certain payments by any Originator or other
Persons pursuant to allocation arrangements that comply with the
requirements of this Section 7.1(i));
(L) operate its business and activities such that: it does not
engage in any business or activity of any kind, or enter into any
transaction or indenture, mortgage, instrument, agreement,
contract, lease or other undertaking, other than the transactions
contemplated and authorized by this Agreement and the
18
Receivables Sale Agreement; and does not create, incur, guarantee,
assume or suffer to exist any indebtedness or other liabilities,
whether direct or contingent, other than (1) as a result of the
endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business, (2) the
incurrence of obligations under this Agreement, (3) the incurrence
of obligations, as expressly contemplated in the Receivables Sale
Agreement, to make payment to the applicable Originator thereunder
for the purchase of Receivables from such Originator under the
Receivables Sale Agreement, and (4) the incurrence of operating
expenses in the ordinary course of business of the type otherwise
contemplated by this Agreement;
(M) maintain its corporate charter in conformity with this
Agreement, such that it does not amend, restate, supplement or
otherwise modify its Certificate of Incorporation or By-Laws in any
respect that would impair its ability to comply with the terms or
provisions of any of the Transaction Documents, including, without
limitation, Section 7.1(i) of this Agreement;
(N) maintain the effectiveness of, and continue to perform
under the Receivables Sale Agreement and the Performance
Undertaking, such that it does not amend, restate, supplement,
cancel, terminate or otherwise modify the Receivables Sale
Agreement or the Performance Undertaking, or give any consent,
waiver, directive or approval thereunder or waive any default,
action, omission or breach under the Receivables Sale Agreement or
the Performance Undertaking or otherwise grant any indulgence
thereunder, without (in each case) the prior written consent of the
Agent;
(O) maintain its corporate separateness such that it does not
merge or consolidate with or into, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions, and except as otherwise contemplated herein) all or
substantially all of its assets (whether now owned or hereafter
acquired) to, or acquire all or substantially all of the assets of,
any Person, nor at any time create, have, acquire, maintain or hold
any interest in any Subsidiary.
(P) maintain at all times the Required Capital Amount and
refrain from making any dividend, distribution, redemption of
capital stock or payment of any subordinated indebtedness which
would cause the Required Capital Amount to cease to be so
maintained; and
(Q) take such other actions as are necessary on its part to
ensure that the facts and assumptions set forth in the opinion
issued by Xxxxxxxx & Xxxxx, as counsel for Seller, in connection
with the closing or initial Purchase under this Agreement and
relating to substantive consolidation issues, and in the
certificates accompanying such opinion, remain true and correct in
all material respects at all times.
19
(j) Collections. Such Seller Party will cause (1) all proceeds from
all Lock-Boxes to be directly deposited by a Collection Bank into a Collection
Account and (2) each Lock-Box and Collection Account to be subject at all times
to a Collection Account Agreement that is in full force and effect. In the event
any payments relating to the Purchased Assets are remitted directly to Seller or
any Affiliate of Seller, Seller will remit (or will cause all such payments to
be remitted) directly to a Collection Bank and deposited into a Collection
Account within two (2) Business Days following receipt thereof, and, at all
times prior to such remittance, Seller will itself hold or, if applicable, will
cause such payments to be held in trust for the exclusive benefit of the Agent
and Blue Ridge. Seller will maintain exclusive ownership, dominion and control
(subject to the terms of this Agreement) of each Lock-Box and Collection Account
and shall not grant the right to take dominion and control of any Lock-Box or
Collection Account at a future time or upon the occurrence of a future event to
any Person, except to the Agent as contemplated by this Agreement.
(k) Taxes. Such Seller Party will file all tax returns and reports
required by law to be filed by it and will promptly pay all taxes and
governmental charges at any time owing, except any such taxes which are not yet
delinquent or are being diligently contested in good faith by appropriate
proceedings and for which adequate reserves in accordance with GAAP shall have
been set aside on its books. Seller will pay when due any taxes payable in
connection with the Receivables, exclusive of taxes on or measured by income or
gross receipts of the Agent or Blue Ridge.
(l) Payment to Applicable Originator. With respect to any
Receivable purchased by Seller from any Originator, such sale shall be effected
under, and in strict compliance with the terms of, the Receivables Sale
Agreement, including, without limitation, the terms relating to the amount and
timing of payments to be made to such Originator in respect of the purchase
price for such Receivable.
Section 7.2 Negative Covenants of the Seller Parties. Until the date on
which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself, that:
(a) Name Change, Offices and Records. Such Seller Party will not
change its name, identity or structure (within the meaning of any applicable
enactment of the UCC), relocate its chief executive office at any time while the
location of its chief executive office is relevant to perfection of the Agent's
security interest, for the benefit of the Secured Parties, in the Receivables,
Related Security and Collections, or change any office where Records are kept
unless it shall have: (i) given the Agent at least forty-five (45) days' prior
written notice thereof and (ii) delivered to the Agent all financing statements,
instruments and other documents requested by the Agent in connection with such
change or relocation.
(b) Change in Payment Instructions to Obligors. Except as may be
required by the Agent pursuant to Section 8.2(b), such Seller Party will not add
or terminate any bank as a Collection Bank, or make any change in the
instructions to Obligors regarding payments to be made to any Lock-Box or
Collection
20
Account, unless the Agent shall have received, at least ten (10) days before the
proposed effective date therefor, (i) written notice of such addition,
termination or change and (ii) with respect to the addition of a Collection Bank
or a Collection Account or Lock-Box, an executed Collection Account Agreement
with respect to the new Collection Account or Lock-Box; PROVIDED, HOWEVER, that
the Servicer may make changes in instructions to Obligors regarding payments if
such new instructions require such Obligor to make payments to another existing
Collection Account.
(c) Modifications to Contracts and Credit and Collection Policy.
Such Seller Party will not, and will not permit any Originator to, make any
change to the Credit and Collection Policy that could materially adversely
affect the collectibility of the Receivables or materially decrease the credit
quality of any newly created Receivables. Except as provided in Section 8.2(d),
the Servicer will not, and will not permit any Originator to, extend, amend or
otherwise modify the terms of any Receivable or any Contract related thereto
other than in accordance with the Credit and Collection Policy.
(d) Sales, Liens. Seller will not sell, assign (by operation of law
or otherwise) or otherwise dispose of, or grant any option with respect to, or
create or suffer to exist any Adverse Claim (other than any right of set-off of
any Collection Bank pursuant to applicable law, if such right is not waived)
upon (including, without limitation, the filing of any financing statement) or
with respect to, any of the Purchased Assets, or assign any right to receive
income with respect thereto (other than, in each case, the creation of a
security interest therein in favor of the Agent as provided for herein), and
Seller will defend the right, title and interest of the Secured Parties in, to
and under any of the foregoing property, against all claims of third parties
claiming through or under Seller or any Originator.
(e) Use of Proceeds. Seller will not use the proceeds of the
Purchases for any purpose other than (i) paying for Receivables and Related
Security under and in accordance with the Receivables Sale Agreement, including
without limitation, making payments on the Subordinated Notes to the extent
permitted thereunder and under the Receivables Sale Agreement, (ii) making
Demand Advances to Tower at any time prior to the Facility Termination Date
while it is acting as Servicer and no Amortization Event or Unmatured
Amortization Event exists and is continuing, (iii) paying its ordinary and
necessary operating expenses when and as due, and (iv) making Restricted Junior
Payments to the extent permitted under this Agreement.
(f) Termination Date Determination. Seller will not designate the
Termination Date (as defined in the Receivables Sale Agreement), or send any
written notice to any Originator in respect thereof, without the prior written
consent of the Agent, except with respect to the occurrence of such Termination
Date arising pursuant to Section 5.1(d) of the Receivables Sale Agreement.
(g) Restricted Junior Payments. Seller will not make any Restricted
Junior Payment if after giving effect thereto, Seller's Net Worth, would be less
than the Required Capital Amount.
(h) Seller Indebtedness. Seller will not incur or permit to exist
any Indebtedness or liability on account of deposits except: (i) the Aggregate
Unpaids, (ii) the Subordinated Loans, and (iii) other current accounts payable
arising in the ordinary course of business and not overdue.
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(i) Prohibition on Additional Negative Pledges. No Seller Party
will enter into or assume any agreement (other than this Agreement and the other
Transaction Documents) prohibiting the creation or assumption of any Adverse
Claim upon the Purchased Assets except as contemplated by the Transaction
Documents, or otherwise prohibiting or restricting any transaction contemplated
hereby or by the other Transaction Documents, and no Seller Party will enter
into or assume any agreement creating any Adverse Claim upon the Subordinated
Notes.
ARTICLE VIII.
ADMINISTRATION AND COLLECTION
Section 8.1 Designation of Servicer.
(a) The servicing, administration and collection of the Receivables
shall be conducted by such Person (the "Servicer") so designated from time to
time in accordance with this Section 8.1. Tower is hereby designated as, and
hereby agrees to perform the duties and obligations of, the Servicer pursuant to
the terms of this Agreement. At any time after the occurrence of an Amortization
Event, the Agent may designate as Servicer any Person to succeed Tower or any
successor Servicer PROVIDED THAT the Rating Agency Condition is satisfied.
(b) Tower may delegate, and Tower hereby advises the Agent and Blue
Ridge that it has delegated, to the Originators, as sub-servicers of the
Servicer, certain of its duties and responsibilities as Servicer hereunder in
respect of the Receivables originated by such Originator. Without the prior
written consent of the Agent and the Required Liquidity Banks, Tower shall not
be permitted to delegate any of its duties or responsibilities as Servicer to
any Person other than (i) Seller, (ii) the Originators, and (iii) with respect
to certain Defaulted Receivables, outside collection agencies in accordance with
its customary practices. Neither Seller nor any Originator shall be permitted to
further delegate to any other Person any of the duties or responsibilities of
the Servicer delegated to it by Tower. If at any time after the occurrence of an
Amortization Event the Agent shall designate as Servicer any Person other than
Tower, all duties and responsibilities theretofore delegated by Tower to Seller
or the Originators may, at the discretion of the Agent, be terminated forthwith
on notice given by the Agent to Tower and to Seller and the Originators.
(c) Notwithstanding the foregoing subsection (b): (i) Tower shall
be and remain primarily liable to the Agent and Blue Ridge for the full and
prompt performance of all duties and responsibilities of the Servicer hereunder
other than any Servicer who is not an Affiliate of Tower and (ii) the Agent and
Blue Ridge shall be entitled to deal exclusively with Tower in matters relating
to the discharge by the Servicer of its duties and responsibilities hereunder.
The Agent and Blue Ridge shall not be required to give notice, demand or other
communication to any Person other than Tower in order for communication to the
Servicer and its sub-servicer or other delegate with respect thereto to be
accomplished. Tower, at all times that it is the Servicer, shall be responsible
for providing any sub-servicer or other delegate of the Servicer with any notice
given to the Servicer under this Agreement.
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Section 8.2 Duties of Servicer.
(a) The Servicer shall take or cause to be taken all such actions
as may be necessary or advisable to collect each Receivable from time to time,
all in accordance with applicable laws, rules and regulations, with reasonable
care and diligence, and in accordance with the Credit and Collection Policy.
(b) The Servicer will instruct all Obligors to pay all Collections
directly to a Lock-Box or Collection Account. The Servicer shall effect a
Collection Account Agreement substantially in the form of Exhibit VI with each
bank party to a Collection Account at any time. In the case of any remittances
received in any Lock-Box or Collection Account that shall have been identified,
to the satisfaction of the Servicer, not to constitute Collections or other
proceeds of the Receivables or the Related Security, the Servicer shall promptly
remit such items to the Person identified to it as being the owner of such
remittances. From and after the date the Agent delivers to any Collection Bank a
Collection Notice pursuant to Section 8.3, the Agent may request that the
Servicer, and the Servicer thereupon promptly shall instruct all Obligors with
respect to the Receivables, to remit all payments thereon to a new depositary
account specified by the Agent and, at all times thereafter, Seller and the
Servicer shall not deposit or otherwise credit, and shall not permit any other
Person to deposit or otherwise credit to such new depositary account any cash or
payment item other than Collections.
(c) The Servicer shall administer the Collections in accordance
with the procedures described herein and in Article II. The Servicer shall set
aside and hold in trust for the account of Seller and Blue Ridge their
respective shares of the Collections in accordance with Article II. The Servicer
shall, upon the request of the Agent, segregate, in a manner acceptable to the
Agent, all cash, checks and other instruments received by it from time to time
constituting Collections from the general funds of the Servicer or Seller prior
to the remittance thereof in accordance with Article II. If the Servicer shall
be required to segregate Collections pursuant to the preceding sentence, the
Servicer shall segregate and deposit with a bank designated by the Agent such
allocable share of Collections of Receivables set aside for Blue Ridge on the
first Business Day following receipt by the Servicer of such Collections, duly
endorsed or with duly executed instruments of transfer.
(d) The Servicer may, in accordance with the Credit and Collection
Policy, extend the maturity of any Receivable or adjust the Outstanding Balance
of any Receivable as the Servicer determines to be appropriate to maximize
Collections thereof; PROVIDED, HOWEVER, that such extension or adjustment shall
not alter the status of such Receivable as a Delinquent Receivable or Defaulted
Receivable or limit the rights of the Agent or Blue Ridge under this Agreement.
Notwithstanding anything to the contrary contained herein, the Agent shall have
the absolute and unlimited right after the occurrence of an Amortization Event
to direct the Servicer to commence or settle any legal action with respect to
any Receivable or to foreclose upon or repossess any Related Security.
(e) The Servicer shall hold in trust for Seller and the Agent and
Blue Ridge all Records that (i) evidence or relate to the Receivables, the
related Contracts and Related Security or (ii) are otherwise necessary or
desirable to collect the Receivables and shall, as soon as practicable upon
demand of the Agent on and on or after the occurrence of an Amortization
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Event, deliver or make available to the Agent all such Records, at a place
selected by the Agent. The Servicer shall, as soon as practicable following
receipt thereof turn over to the appropriate party any cash collections or other
cash proceeds not constituting Collections. The Servicer shall, from time to
time at the request of the Agent or Blue Ridge, furnish to Blue Ridge (promptly
after any such request) a calculation of the amounts set aside for Blue Ridge
pursuant to Article II.
(f) Any payment by an Obligor in respect of any indebtedness owed
by it to Originator or Seller shall, except as otherwise specified by such
Obligor or otherwise required by contract or law and unless otherwise instructed
by the Agent, be applied as a Collection of any Receivable of such Obligor
(starting with the oldest such Receivable) to the extent of any amounts then due
and payable thereunder before being applied to any other receivable or other
obligation of such Obligor.
Section 8.3 Collection Notices.
(a) The Agent is authorized after the occurrence of an Amortization
Event to date and to deliver to the Collection Banks the Collection Notices.
Seller hereby transfers to the Agent for the benefit of Blue Ridge, effective
when the Agent delivers such notice, the exclusive ownership and control of each
Lock-Box and the Collection Accounts. In case any authorized signatory of Seller
whose signature appears on a Collection Account Agreement shall cease to have
such authority before the delivery of such notice, such Collection Notice shall
nevertheless be valid as if such authority had remained in force. Seller hereby
authorizes the Agent, and agrees that the Agent shall be entitled (i) at any
time after delivery of the Collection Notices, to endorse Seller's name on
checks and other instruments representing Collections, (ii) at any time after
the occurrence of an Amortization Event, to enforce the Receivables, the related
Contracts and the Related Security, and (iii) at any time after the occurrence
of an Amortization Event, to take such action as shall be necessary or desirable
to cause all cash, checks and other instruments constituting Collections of
Receivables to come into the possession of the Agent rather than Seller.
(b) Notwithstanding the foregoing, in the event that the Agent has
delivered Collection Notice(s) after the occurrence of an Amortization Event
pursuant to Section 8.3(a), the Agent shall, subject to the following sentence,
deliver to the Seller or the Collection Banks the Facility Termination Notice(s)
within five (5) Business Days of the receipt of such Facility Termination Notice
from the Seller; provided that all outstanding Indebtedness and Aggregate
Unpaids under this Agreement shall have been paid in full and this Agreement
shall have terminated in accordance with its terms. Prior to Agent's obligation
to execute and deliver such Facility Termination Notice, if any Originator or
Seller has suffered an Event of Bankruptcy prior to Seller's delivery of such
Facility Termination Notice to Agent, Seller shall provide evidence satisfactory
to the Agent in its sole discretion that all amounts remitted by Servicer to the
Agent's Account pursuant to Article II hereof represent Collections received
with respect to Receivables generated prior to such Event of Bankruptcy. Upon
delivery of the Facility Termination Notice(s) by the Agent, the exclusive
ownership and control of the Collection Accounts shall revert from the Agent to
the Seller Parties, and the Agent shall thereafter cease to exercise control
over the Collection Accounts and shall relinquish all rights and remedies with
respect thereto. Notwithstanding anything herein or in any other Transaction
Document to the
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contrary, Agent is under no obligation to execute and deliver the Facility
Termination Notice except as provided in this Agreement.
Section 8.4 Responsibilities of Seller. Anything herein to the contrary
notwithstanding, the exercise by the Agent, on behalf of Blue Ridge, of the
Agent's rights hereunder shall not release the Servicer, any Originator or
Seller from any of their duties or obligations with respect to any Receivables
or under the related Contracts. The Agent and Blue Ridge shall have no
obligation or liability with respect to any Receivables or related Contracts,
nor shall any of them be obligated to perform the obligations of Seller or any
Originator thereunder.
Section 8.5 Monthly Reports. The Servicer shall prepare and forward to
the Agent (i) on each Monthly Reporting Date, a Monthly Report and an electronic
file of the data contained therein and (ii) at such times as the Agent shall
request, a listing by Obligor of all Receivables together with an aging of such
Receivables; provided, however, that if an Amortization Event shall exist and be
continuing, the Agent may request that the Servicer deliver a Monthly Report
more frequently than monthly.
Section 8.6 Servicing Fee. As compensation for the Servicer's servicing
activities on their behalf, the Servicer shall be paid the Servicing Fee in
arrears on each Settlement Date out of Collections.
ARTICLE IX.
AMORTIZATION EVENTS
Section 9.1 Amortization Events. The occurrence of any one or more of
the following events shall constitute an Amortization Event:
(a) Any Seller Party or Performance Guarantor shall fail to make
any (i) payment or deposit required to be made by it under the Transaction
Documents when due and such failure continues for one (1) Business Day;
PROVIDED, HOWEVER, that no Amortization Event shall occur under this Section
9.1(a)(i) as a result of any late payment or deposit which is cured within two
(2) Business Days if (A) such late payment or deposit was due to circumstances
beyond such Seller Party's or Performance Guarantor's control, (B) such late
payments or deposits do not occur more than two (2) times in any calendar year,
and (C) such Seller Party or Performance Guarantor pays interest on the overdue
amount of such payment or deposit until paid at the Default Rate, or (ii) for
any such payment or deposit which is not in respect of principal, such failure
continues for five (5) consecutive Business Days.
(b) Any representation, warranty, certification or statement made
by Performance Guarantor or any Seller Party in any Transaction Document to
which it is a party or in any other document delivered pursuant thereto shall
prove to have been incorrect in any material respect (except if such
representation or warranty already has a materiality threshold) when made or
deemed made.
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(c) Any Seller Party shall (i) fail to perform or observe any
covenant contained in Section 7.2(b)-(i) or (ii) fails to deliver any reports
required by Section 8.5 when due and such failure to deliver any such reports
continues for more than one (1) Business Day.
(d) Any Seller Party or Performance Guarantor or Permitted
Sub-Servicer shall fail to perform or observe any other covenant or agreement
under any Transaction Document and such failure continues for thirty (30) days
after such Seller Party obtains knowledge of such failure or Agent notifies such
Seller Party of such failure, whichever occurs first.
(e) Failure of Seller to pay any Indebtedness (other than the
Aggregate Unpaids) when due or the default by Seller in the performance of any
term, provision or condition contained in any agreement under which any such
Indebtedness was created or is governed, the effect of which is to cause, or to
permit the holder or holders of such Indebtedness to cause, such Indebtedness to
become due prior to its stated maturity; or any such Indebtedness of Seller
shall be declared to be due and payable or required to be prepaid (other than by
a regularly scheduled payment) prior to the date of maturity thereof.
(f) Failure of Performance Guarantor or any of its Material
Restricted Domestic Subsidiaries other than Seller to pay Indebtedness in excess
of $10,000,000 in aggregate principal amount (hereinafter, "MATERIAL
INDEBTEDNESS") when due; or the default by Performance Guarantor or any of its
Material Restricted Domestic Subsidiaries other than Seller in the performance
of any term, provision or condition contained in any agreement under which any
Material Indebtedness was created or is governed, the effect of which is, after
the passage of any applicable grace or cure period, to cause, or to permit the
holder or holders of such Material Indebtedness to cause, such Material
Indebtedness to become due prior to its stated maturity; or any Material
Indebtedness of Performance Guarantor or any of its Material Restricted Domestic
Subsidiaries other than Seller shall be declared to be due and payable or
required to be prepaid (other than by a regularly scheduled payment) prior to
the date of maturity thereof.
(g) An Event of Bankruptcy shall occur with respect to Performance
Guarantor, any Seller Party or any of their Material Restricted Domestic
Subsidiaries.
(h) As at the end of any Calculation Period:
(i) the three-month rolling average Delinquency Ratio shall
exceed 4.00%,
(ii) the three-month rolling average Loss Reserve Ratio shall
exceed 5.25%, or
(iii) the three-month rolling average Dilution Ratio shall
exceed 3.5%.
(i) A Change of Control shall occur.
(j) (i) One or more final judgments for the payment of money in an
aggregate amount of $10,750 or more shall be entered against Seller or (ii) one
or more final judgments for
26
the payment of money in an amount in excess of $10,000,000, individually or in
the aggregate, shall be entered against Performance Guarantor or any of its
Material Restricted Domestic Subsidiaries (other than Seller on claims not
covered by insurance or as to which the insurance carrier has denied its
responsibility, and such judgment shall continue unsatisfied and in effect for
thirty (30) consecutive days without a stay of execution.
(k) The "TERMINATION DATE" under and as defined in the Receivables
Sale Agreement shall occur under the Receivables Sale Agreement with respect to
a Material Originator or any Originator shall for any reason (other than
pursuant to a Permitted Restructuring) cease to transfer, or cease to have the
legal capacity to transfer, or otherwise be incapable of transferring
Receivables to Seller under the Receivables Sale Agreement.
(l) This Agreement shall terminate in whole or in part (except in
accordance with its terms), or shall cease to be effective or to be the legally
valid, binding and enforceable obligation of Seller or the Agent for the benefit
of Blue Ridge shall cease to have a valid and perfected first priority security
interest in the Purchased Assets.
(m) On any Settlement Date, after giving effect to the turnover of
Collections by the Servicer on such date and the application thereof to the
Aggregate Unpaids in accordance with this Agreement, the (i) the Receivable
Interest shall exceed 100% or (ii) Aggregate Invested Amount shall exceed the
Purchase Limit.
(n) The Performance Undertaking shall cease to be effective or to
be the legally valid, binding and enforceable obligation of Performance
Guarantor, or Performance Guarantor shall directly or indirectly contest in any
manner such effectiveness, validity, binding nature or enforceability of its
obligations thereunder.
(o) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Tax Code with regard to any of the Purchased
Assets and such lien shall not have been released within seven (7) days, or the
PBGC shall, or shall indicate its intention to, file notice of a lien pursuant
to Section 4068 of ERISA with regard to any of the Purchased Assets.
(p) Any Plan of Performance Guarantor or any of its ERISA
Affiliates:
(i) shall fail to be funded in an amount in excess of 10% of
the Net Worth of the Performance Guarantor in accordance with the
minimum funding standard required by applicable law, the terms of such
Plan, Section 412 of the Tax Code or Section 302 of ERISA for any plan
year or a waiver of such standard is sought or granted with respect to
such Plan under applicable law, the terms of such Plan or Section 412
of the Tax Code or Section 303 of ERISA; or
(ii) is being, or has been, terminated or the subject of
termination proceedings under applicable law or the terms of such Plan;
or
(iii) shall require Performance Guarantor or any of its ERISA
Affiliates to provide security in an amount in excess of 10% of the Net
Worth of the Performance Guarantor under applicable law, the terms of
such Plan, Section 401 or 412 of the Tax Code or Section 306 or 307 of
ERISA; or
27
(iv) results in a liability in an amount in excess of 10% of
the Net Worth of the Performance Guarantor to Performance Guarantor or
any of its ERISA Affiliates under applicable law, the terms of such
Plan, or Title IV ERISA,
and there shall result from any such failure, waiver, termination or other event
a liability to the PBGC or a Plan that would have a Material Adverse Effect.
(q) Any event shall occur which (i) materially and adversely
impairs the ability of the Originators to originate Receivables of a credit
quality not materially different than the credit quality of the Receivables sold
or contributed to Seller on the date of this Agreement or (ii) has, or could be
reasonably likely to have a Material Adverse Effect other than a Permitted
Restructuring.
(r) Any one of the following events shall occur:
(i) less than 75% of all Collections received during the
Calculation Period ending July 31, 2001 shall have been made to a
Lock-Box or a Lock-Box Account; a report indicating such collection
activity due no later than August 15, 2001;
(ii) less than 85% of all Collections received during the
Calculation Period ending August 31, 2001 shall have been made to a
Lock-Box or a Lock-Box Account; a report indicating such collection
activity due no later than September 17, 2001;
(iii) less than 95% of all Collections received during the
Calculation Period ending September 30, 2001 shall have been made to a
Lock-Box or a Lock-Box Account; a report indicating such collection
activity due no later than October 15, 2001;
Section 9.2 Remedies. Upon the occurrence and during the continuation
of an Amortization Event, the Agent may, or upon the direction of the Required
Liquidity Banks shall, take any of the following actions: (i) replace the Person
then acting as Servicer, (ii) declare the Facility Termination Date to have
occurred, whereupon Reinvestments shall immediately terminate and the Facility
Termination Date shall forthwith occur, all without demand, protest or further
notice of any kind, all of which are hereby expressly waived by each Seller
Party; PROVIDED, HOWEVER, that upon the occurrence of an Event of Bankruptcy
with respect to any Seller Party, the Facility Termination Date shall
automatically occur, without demand, protest or any notice of any kind, all of
which are hereby expressly waived by each Seller Party, (iii) deliver the
Collection Notices to the Collection Banks, (iv) exercise all rights and
remedies of a secured party upon default under the UCC and other applicable
laws, and (v) notify Obligors of the Agent's security interest in the
Receivables and other Purchased Assets. The aforementioned rights and remedies
shall be without limitation, and shall be in addition to all other rights and
remedies of the Agent and Blue Ridge otherwise available under any other
provision of this Agreement, by operation of law, at equity or otherwise, all of
which are hereby expressly preserved, including, without limitation, all rights
and remedies provided under the UCC, all of which rights shall be cumulative.
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ARTICLE X.
INDEMNIFICATION
Section 10.1 Indemnities by the Seller Parties. Without limiting any
other rights that the Agent or Blue Ridge may have hereunder or under applicable
law, (A) Seller hereby agrees to indemnify (and pay upon demand to) the Agent,
Blue Ridge, each of the Liquidity Banks and each of the respective assigns,
officers, directors, agents and employees of the foregoing (each, an
"INDEMNIFIED PARTY") from and against any and all damages, losses, claims,
taxes, liabilities, costs, expenses and for all other amounts payable, including
reasonable attorneys' fees (which attorneys may be employees of the Agent or
another Indemnified Party) and disbursements (all of the foregoing being
collectively referred to as "INDEMNIFIED AMOUNTS") awarded against or incurred
by any of them arising out of or as a result of this Agreement or the
acquisition, either directly or indirectly, by Blue Ridge or any of its
Liquidity Banks of an interest in the Receivables, and (B) the Servicer hereby
agrees to indemnify (and pay upon demand to) each Indemnified Party for
Indemnified Amounts awarded against or incurred by any of them arising out of
the Servicer's activities as Servicer hereunder EXCLUDING, HOWEVER, in all of
the foregoing instances under the preceding clauses (A) and (B):
(a) Indemnified Amounts to the extent a final judgment of a court
of competent jurisdiction holds that such Indemnified Amounts resulted
from gross negligence or willful misconduct on the part of the
Indemnified Party seeking indemnification;
(b) Indemnified Amounts to the extent the same includes losses in
respect of Receivables that are uncollectible on account of the
insolvency, bankruptcy or lack of creditworthiness of the related
Obligor; or
(c) all income taxes except in jurisdictions where Indemnified
Parties would not otherwise be subject to taxation but for the
transactions contemplated by the Transaction Documents;
PROVIDED, HOWEVER, that nothing contained in this sentence shall limit the
liability of any Seller Party or limit the recourse of Blue Ridge to any Seller
Party for amounts otherwise specifically provided to be paid by such Seller
Party under the terms of this Agreement. Without limiting the generality of the
foregoing indemnification, Seller shall indemnify the Agent and Blue Ridge for
Indemnified Amounts (including, without limitation, losses in respect of
uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to Seller or the Servicer) relating to or resulting from:
(i) any representation or warranty made by any Seller Party or
any Originator (or any officers of any such Person) under or in
connection with this Agreement, any other Transaction Document or any
other information or report delivered by any such Person pursuant
hereto or thereto, which shall have been false or incorrect when made
or deemed made;
29
(ii) the failure by Seller, the Servicer or any Originator to
comply with any applicable law, rule or regulation with respect to any
Receivable or Contract related thereto, or the nonconformity of any
Receivable or Contract included therein with any such applicable law,
rule or regulation or any failure of any Originator to keep or perform
any of its obligations, express or implied, with respect to any
Contract;
(iii) any failure of Seller, the Servicer or any Originator to
perform its duties, covenants or other obligations in accordance with
the provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or damage suit, or
other similar claim arising out of or in connection with merchandise,
insurance or services that are the subject of any Contract or any
Receivable;
(v) any dispute, claim, offset or defense (other than discharge
in bankruptcy of the Obligor) of the Obligor to the payment of any
Receivable (including, without limitation, a defense based on such
Receivable or the related Contract not being a legal, valid and binding
obligation of such Obligor enforceable against it in accordance with
its terms), or any other claim resulting from the sale of the
merchandise or service related to such Receivable or the furnishing or
failure to furnish such merchandise or services;
(vi) the commingling of Collections of Receivables at any time
with other funds;
(vii) any investigation, litigation or proceeding related to or
arising from this Agreement or any other Transaction Document, the
transactions contemplated hereby, the use of the proceeds of any
Purchase, the Purchased Assets or any other investigation, litigation
or proceeding relating to Seller, the Servicer or any Originator in
which any Indemnified Party becomes involved as a result of any of the
transactions contemplated hereby;
(viii) any inability to litigate any claim against any Obligor
in respect of any Receivable as a result of such Obligor being immune
from civil and commercial law and suit on the grounds of sovereignty or
otherwise from any legal action, suit or proceeding;
(ix) any Amortization Event of the type described in Section
9.1(g);
(x) any failure of Seller to acquire and maintain legal and
equitable title to, and ownership of any of the Purchased Assets from
the applicable Originator, free and clear of any Adverse Claim (other
than as created hereunder); or any failure of Seller to give reasonably
equivalent value to any Originator under the Receivables Sale Agreement
in consideration of the transfer by such Originator of any Receivable,
or any attempt by any Person to void such transfer under statutory
provisions or common law or equitable action;
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(xi) any failure to vest and maintain vested in the Agent for
the benefit of Blue Ridge, or to transfer to the Agent for the benefit
of the Secured Parties, a valid first priority perfected security
interests in the Purchased Assets, free and clear of any Adverse Claim
(except as created by the Transaction Documents);
(xii) the failure to have filed, or any material delay in
filing, financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable laws
with respect to any Purchased Assets, and the proceeds thereof, whether
at the time of any Purchase or at any subsequent time;
(xiii) any action or omission by any Seller Party which reduces
or impairs the rights of the Agent or Blue Ridge with respect to any
Purchased Assets or the value of any Purchased Assets;
(xiv) any attempt by any Person to void any Purchase or the
Agent's security interest in the Purchased Assets under statutory
provisions or common law or equitable action; and
(xv) the failure of any Receivable included in the calculation
of the Net Pool Balance as an Eligible Receivable to be an Eligible
Receivable at the time so included.
Section 10.2 Increased Cost and Reduced Return. If after the date
hereof, any Funding Source shall be charged any fee, expense or increased cost
on account of the adoption of any applicable law, rule or regulation (including
any applicable law, rule or regulation regarding capital adequacy) or any change
therein, or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency (a "REGULATORY CHANGE"): (i) that subjects any
Funding Source to any charge or withholding on or with respect to any Funding
Agreement or a Funding Source's obligations under a Funding Agreement, or on or
with respect to the Receivables, or changes the basis of taxation of payments to
any Funding Source of any amounts payable under any Funding Agreement (except
for changes in the rate of tax on the overall net income of a Funding Source or
taxes excluded by Section 10.1) or (ii) that imposes, modifies or deems
applicable any reserve, assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the account of a Funding
Source, or credit extended by a Funding Source pursuant to a Funding Agreement
or (iii) that imposes any other condition the result of which is to increase the
cost to a Funding Source of performing its obligations under a Funding
Agreement, or to reduce the rate of return on a Funding Source's capital as a
consequence of its obligations under a Funding Agreement, or to reduce the
amount of any sum received or receivable by a Funding Source under a Funding
Agreement or to require any payment calculated by reference to the amount of
interests or loans held or interest received by it, then, upon demand by the
Agent, Seller shall pay to the Agent, for the benefit of the relevant Funding
Source, such amounts charged to such Funding Source or such amounts to otherwise
compensate such Funding Source for such increased cost or such reduction.
31
Section 10.3 Other Costs and Expenses. Seller shall pay to the Agent
and Blue Ridge on demand all reasonable costs and out-of-pocket expenses
actually incurred in connection with the preparation, execution, delivery and
administration of this Agreement, the transactions contemplated hereby and the
other documents to be delivered hereunder, including without limitation, the
cost of Blue Ridge's auditors auditing the books, records and procedures of
Seller, reasonable fees and out-of-pocket expenses of legal counsel for Blue
Ridge and the Agent (which such counsel may be employees of Blue Ridge or the
Agent) with respect thereto and with respect to advising Blue Ridge and the
Agent as to their respective rights and remedies under this Agreement. Seller
shall pay to the Agent on demand any and all reasonable costs and expenses of
the Agent and Blue Ridge, if any, including reasonable counsel fees and expenses
actually incurred in connection with the enforcement of this Agreement and the
other documents delivered hereunder and in connection with any restructuring or
workout of this Agreement or such documents, or the administration of this
Agreement following an Amortization Event.
Section 10.4 Allocations. Blue Ridge shall allocate the liability for
increased costs covered by Section 10.2 arising under Funding Agreements that
are not specifically related solely to this Agreement ("SHARED INCREASED COSTS")
among Seller and other Persons with whom Blue Ridge has entered into agreements
to purchase interests in or finance receivables and other financial assets
("OTHER CUSTOMERS"). If any Shared Increased Costs are attributable to the
facility evidenced by this Agreement and not to any Other Customers' facilities,
Seller shall be solely liable for such Shared Increased Costs. However, if
Shared Increased Costs are attributable to Other Customers and their facilities
but not attributable to Seller and the facility evidenced hereby, such Other
Customer shall be solely liable for such Shared Increased Costs, as the case may
be. All allocations to be made pursuant to the foregoing provisions of this
Article X shall be made by Blue Ridge in its sole discretion and shall be
binding on Seller and the Servicer.
ARTICLE XI.
THE AGENT
Section 11.1 Authorization and Action. Blue Ridge, on behalf of itself
and its assigns, hereby designates and appoints Wachovia to act as its agent
under the Liquidity Agreement, this Agreement and under each other Transaction
Document, and authorizes the Agent to take such actions as agent on its behalf
and to exercise such powers as are delegated to the Agent by the terms of the
Liquidity Agreement, this Agreement and the other Transaction Documents together
with such powers as are reasonably incidental thereto, including, without
limitation, the power to perfect all security interests granted under the
Transaction Documents. The provisions of Article 6 of the Liquidity Agreement
are hereby incorporated by this reference with the same force and effect as if
fully set forth herein, and shall govern the relationship between the Agent, on
the one hand, and Blue Ridge, on the other. Agent shall provide to Seller notice
of any Downgrading Event with respect to a Downgraded Liquidity Bank.
32
ARTICLE XII.
ASSIGNMENTS AND PARTICIPATIONS
Section 12.1 Assignments and Participations by Blue Ridge. Each of the
parties hereto, on behalf of its successors and assigns, hereby agrees and
consents to the complete or partial sale by Blue Ridge of all or any portion of
its rights under, interest in, title to and obligations under this Agreement to
the Liquidity Banks pursuant to the Liquidity Agreement, regardless of whether
such sale constitutes an assignment or the sale of a participation in such
rights and obligations. Prior to the occurrence of an Unmatured Amortization
Event or an Amortization Event, no other Assignment shall be allowed without the
prior written consent of the Seller, such consent not to be unreasonably
withheld.
Section 12.2 Prohibition on Assignments by Seller Parties. No Seller Party may
assign any of its rights or obligations under this Agreement without the prior
written consent of the Agent and Blue Ridge and without satisfying the Rating
Agency Condition.
ARTICLE XIII.
MISCELLANEOUS
Section 13.1 Waivers and Amendments.
(a) No failure or delay on the part of the Agent or Blue Ridge in
exercising any power, right or remedy under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other further exercise thereof or the exercise of
any other power, right or remedy. The rights and remedies herein provided shall
be cumulative and nonexclusive of any rights or remedies provided by law. Any
waiver of this Agreement shall be effective only in the specific instance and
for the specific purpose for which given.
(b) No provision of this Agreement may be amended, supplemented,
modified or waived except in writing in accordance with the provisions of this
Section 13.1(b). Blue Ridge, Seller and the Agent, at the direction of the
Required Liquidity Banks, may enter into written modifications or waivers of any
provisions of this Agreement, PROVIDED, HOWEVER, that no such modification or
waiver shall:
(i) without the consent of Blue Ridge and each affected
Liquidity Bank, (A) extend the Liquidity Termination Date or the date
of any payment or deposit of Collections by Seller or the Servicer, (B)
reduce the rate or extend the time of payment of Yield or any CP Costs
(or any component of Yield or CP Costs), (C) reduce any fee payable to
the Agent for the benefit of Blue Ridge, (D) change the Invested Amount
of any Receivable Interest, (E) amend, modify or waive any provision of
the definition of Required Liquidity Banks or this Section 13.1(b), (F)
consent to or permit the assignment or transfer by Seller of any of its
rights and obligations under this Agreement, (G) change the definition
of "ELIGIBLE RECEIVABLE," "LOSS RESERVE," "DILUTION RESERVE," "YIELD
RESERVE," "SERVICING RESERVE," "SERVICING FEE RATE," "REQUIRED RESERVE"
or
33
"REQUIRED RESERVE FACTOR FLOOR" or (H) amend or modify any defined term
(or any defined term used directly or indirectly in such defined term)
used in clauses (A) through (G) above in a manner that would circumvent
the intention of the restrictions set forth in such clauses; or
(ii) without the written consent of the then Agent, amend,
modify or waive any provision of this Agreement if the effect thereof
is to affect the rights or duties of such Agent,
AND ANY MATERIAL AMENDMENT, WAIVER OR OTHER MODIFICATION OF THIS AGREEMENT SHALL
REQUIRE SATISFACTION OF THE RATING AGENCY CONDITION.
Section 13.2 Notices. Except as provided in this Section 13.2, all
communications and notices provided for hereunder shall be in writing (including
bank wire, telecopy or electronic facsimile transmission or similar writing) and
shall be given to the other parties hereto at their respective addresses or
telecopy numbers set forth on the signature pages hereof or at such other
address or telecopy number as such Person may hereafter specify for the purpose
of notice to each of the other parties hereto. Each such notice or other
communication shall be effective (i) if given by telecopy, upon the receipt
thereof, (ii) if given by mail, three (3) Business Days after the time such
communication is deposited in the mail with first class postage prepaid or (iii)
if given by any other means, when received at the address specified in this
Section 13.2. Seller hereby authorizes the Agent to effect Purchases and
Interest Period and Yield Rate selections based on telephonic notices made by
any Person whom the Agent in good faith believes to be acting on behalf of
Seller. Seller agrees to deliver promptly to the Agent a written confirmation of
each telephonic notice signed by an authorized officer of Seller; PROVIDED,
HOWEVER, the absence of such confirmation shall not affect the validity of such
notice. If the written confirmation differs from the action taken by the Agent,
the records of the Agent shall govern absent manifest error.
Section 13.3 Protection of Agent's Security Interest.
(a) Seller agrees that from time to time, at its expense, it will
promptly execute and deliver all instruments and documents, and take all
actions, that may be necessary or reasonably desirable, or that the Agent may
reasonably request, to perfect, protect or more fully evidence the Agent's
security interest in the Purchased Assets, or to enable the Agent or Blue Ridge
to exercise and enforce their rights and remedies hereunder. At any time after
the occurrence of an Amortization Event, the Agent may, or the Agent may direct
Seller or the Servicer to, notify the Obligors of Receivables, at Seller's
expense, of the ownership or security interests of Blue Ridge under this
Agreement and may also direct that payments of all amounts due or that become
due under any or all Receivables be made directly to the Agent or its designee.
Seller or the Servicer (as applicable) shall, at the Agent's request, withhold
the identities of the Agent and Blue Ridge in any such notification.
(b) If any Seller Party fails to perform any of its obligations
hereunder, the Agent or Blue Ridge may (but shall not be required to) perform,
or cause performance of, such obligations, and the Agent's or Blue Ridge's
reasonable costs and expenses incurred in connection therewith shall be payable
by Seller as provided in Section 10.3. Each Seller Party
34
irrevocably authorizes the Agent at any time and from time to time, and appoints
the Agent as its attorney-in-fact, to act on behalf of such Seller Party (i) to
execute on behalf of Seller as debtor and to file financing statements necessary
or reasonably desirable to perfect and to maintain the perfection and priority
of the interest of Blue Ridge in the Receivables and (ii) to file a carbon,
photographic or other reproduction of this Agreement or any financing statement
with respect to the Receivables as a financing statement in such offices as the
Agent deems necessary or reasonably desirable to perfect and to maintain the
perfection and priority of the Agent's security interest in the Purchased
Assets, for the benefit of the Secured Parties. This appointment is coupled with
an interest and is irrevocable. From and after July 1, 2001: (A) each of the
Seller Parties hereby authorizes the Agent to file financing statements and
other filing or recording documents with respect to the Receivables and Related
Security (including any amendments thereto, or continuation or termination
statements thereof), without the signature or other authorization of such Seller
Party, in such form and in such offices as the Agent reasonably determines
appropriate to perfect or maintain the perfection of the security interest of
the Agent hereunder, (B) each of the Seller Parties acknowledges and agrees that
it is not authorized to, and will not, file financing statements or other filing
or recording documents with respect to the Receivables or Related Security
(including any amendments thereto, or continuation or termination statements
thereof), without the express prior written approval by the Agent, consenting to
the form and substance of such filing or recording document, and (C) each of the
Seller Parties approves, authorizes and ratifies any filings or recordings made
by or on behalf of the Agent in connection with the perfection of the security
interests in favor of Seller or the Agent.
Section 13.4 Confidentiality.
(a) Each of the Seller Parties shall maintain and shall cause each
of its employees and officers to maintain the confidentiality of this Agreement
and the other confidential or proprietary information with respect to the Agent
and Blue Ridge and their respective businesses obtained by it or them in
connection with the structuring, negotiating and execution of the transactions
contemplated herein, except that such Seller Party and its officers and
employees may disclose such information to such Seller Party's external
accountants and attorneys and as required by any applicable law or order of any
judicial or administrative proceeding.
(b) Anything herein to the contrary notwithstanding, each Seller
Party hereby consents to the disclosure of any nonpublic information with
respect to it (i) to the Agent, the Liquidity Banks or Blue Ridge by each other,
(ii) by the Agent or Blue Ridge to any prospective or actual assignee or
participant of any of them and (iii) by the Agent to any rating agency,
Commercial Paper dealer or provider of a surety, guaranty or credit or liquidity
enhancement to Blue Ridge or any entity organized for the purpose of purchasing,
or making loans secured by, financial assets for which Wachovia acts as the
administrative agent and to any officers, directors, employees, outside
accountants and attorneys of any of the foregoing, PROVIDED THAT each such
Person is informed of the confidential nature of such information and instructed
to keep such information confidential. In addition, Blue Ridge and the Agent may
disclose any such nonpublic information pursuant to any law, rule, regulation,
direction, request or order of any judicial, administrative or regulatory
authority or proceedings (whether or not having the force or effect of law).
35
(c) Blue Ridge, Wachovia and each Liquidity Bank shall maintain and
shall cause each of its respective employees and officers to maintain the
confidentiality of this Agreement and the Receivables Sale Agreement and the
other confidential or proprietary information with respect to the Seller and the
Originators and their respective businesses obtained by it or them in connection
with the structuring, negotiating and execution of the transactions contemplated
herein or therein, except that each such party and its officers and employees
may disclose such information to such Person's external accountants and
attorneys and as required by any applicable law or order of any judicial or
administrative proceeding.
Section 13.5 Bankruptcy Petition. Seller, the Servicer, the Agent and
each Liquidity Bank hereby covenants and agrees that, prior to the date that is
one year and one day after the payment in full of all outstanding senior
indebtedness of Blue Ridge, it will not institute against, or join any other
Person in instituting against, Blue Ridge any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceeding
under the laws of the United States or any state of the United States.
Section 13.6 Limitation of Liability. Except with respect to any claim
arising out of the willful misconduct or gross negligence of Blue Ridge, the
Agent or any Liquidity Bank, no claim may be made by any Seller Party or any
other Person against Blue Ridge, the Agent or any Liquidity Bank or their
respective Affiliates, directors, officers, employees, attorneys or agents for
any special, indirect, consequential or punitive damages in respect of any claim
for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement, or any act, omission
or event occurring in connection therewith; and each Seller Party hereby waives,
releases, and agrees not to xxx upon any claim for any such damages, whether or
not accrued and whether or not known or suspected to exist in its favor.
Section 13.7 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, without regard
to the principles of conflicts of laws thereof OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW (except in the case of the other Transaction Documents,
to the extent otherwise expressly stated therein) AND EXCEPT TO THE EXTENT THAT
THE PERFECTION OF THE OWNERSHIP INTEREST OF SELLER OR THE SECURITY INTEREST OF
THE AGENT, FOR THE BENEFIT OF THE SECURED PARTIES, IN ANY OF THE COLLATERAL IS
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
Section 13.8 CONSENT TO JURISDICTION. EACH PARTY TO THIS AGREEMENT
HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED
STATES FEDERAL OR NEW YORK STATE COURT SITTING IN NEW YORK, NEW YORK, IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
DOCUMENT EXECUTED BY SUCH PERSON PURSUANT TO THIS AGREEMENT, AND EACH SUCH PARTY
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES
ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN SUCH
36
A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT
THE RIGHT OF THE AGENT OR ANY PURCHASER TO BRING PROCEEDINGS AGAINST ANY SELLER
PARTY IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY
SELLER PARTY AGAINST THE AGENT OR ANY PURCHASER OR ANY AFFILIATE OF THE AGENT OR
ANY PURCHASER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING
OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY
SUCH SELLER PARTY PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN
NEW YORK, NEW YORK.
Section 13.9 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT
OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY ANY
SELLER PARTY PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED
HEREUNDER OR THEREUNDER.
Section 13.10 Integration; Binding Effect; Survival of Terms.
(a) This Agreement and each other Transaction Document contain the
final and complete integration of all prior expressions by the parties hereto
with respect to the subject matter hereof and shall constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
superseding all prior oral or written understandings.
(b) This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted assigns
(including any trustee in bankruptcy). This Agreement shall create and
constitute the continuing obligations of the parties hereto in accordance with
its terms and shall remain in full force and effect until terminated in
accordance with its terms; PROVIDED, HOWEVER, that the rights and remedies with
respect to (i) any breach of any representation and warranty made by any Seller
Party pursuant to Article V, (ii) the indemnification and payment provisions of
Article X, and Sections 13.4 and 13.5 shall be continuing and shall survive any
termination of this Agreement.
(c) Each of the Seller Parties, Blue Ridge and the Agent hereby
acknowledges and agrees that the Liquidity Banks are hereby made express third
party beneficiaries of this Agreement and each of the other Transaction
Documents.
Section 13.11 Counterparts; Severability; Section References. This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which when taken together shall constitute one and
the same Agreement. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier shall be effective as delivery of a manually
executed counterpart of a signature page to this Agreement. Any provisions of
this Agreement which are prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction
37
shall not invalidate or render unenforceable such provision in any other
jurisdiction. Unless otherwise expressly indicated, all references herein to
"ARTICLE," "SECTION," "SCHEDULE" or "EXHIBIT" shall mean articles and sections
of, and schedules and exhibits to, this Agreement.
Section 13.12 Characterization.
(a) It is the intention of the parties hereto that each Purchase
hereunder shall constitute and be treated as an absolute and irrevocable sale,
which Purchase shall provide the Blue Ridge with the full benefits of ownership
of the applicable Receivable Interest. Except as specifically provided in this
Agreement, each sale of a Receivable Interest hereunder is made without recourse
to Seller; PROVIDED, HOWEVER, that (i) Seller shall be liable to Blue Ridge and
the Agent for all representations, warranties, covenants and indemnities made by
Seller pursuant to the terms of this Agreement, and (ii) such sale does not
constitute and is not intended to result in an assumption by Blue Ridge or the
Agent or any assignee thereof of any obligation of Seller or any Originator or
any other person arising in connection with the Receivables, the Related
Security, or the related Contracts, or any other obligations of Seller or any
Originator.
(b) In addition to any ownership interest which the Agent or Blue
Ridge may from time to time acquire pursuant hereto, Seller hereby grants to the
Agent for the ratable benefit of Blue Ridge a valid and perfected security
interest in all of Seller's right, title and interest in, to and under all
Receivables now existing or hereafter arising, the Collections, each Lock-Box,
each Collection Account, all Related Security, all other rights and payments
relating to such Receivables, and all proceeds of any thereof prior to all other
liens on and security interests therein to secure the prompt and complete
payment of the Aggregate Unpaids. The Agent, on behalf of Blue Ridge, shall
have, in addition to the rights and remedies that it may have under this
Agreement, all other rights and remedies provided to a secured creditor under
the UCC and other applicable law, which rights and remedies shall be cumulative.
(c) It is the intention of the parties hereto that the transactions
contemplated by this Agreement will create indebtedness for United States
federal, state and local income and franchise tax purposes (collectively, "Tax
Purposes"). Except insofar as there shall have been a final determination by a
court or governmental agency (in which a party hereto was a party) holding that
such transactions (or any part thereof) are not indebtedness for any Tax
Purposes or except, insofar as a party has received a legal opinion from legal
counsel who is reasonably satisfactory to the other parties hereto, to the
effect that substantial authority is lacking to treat such transactions as
indebtedness for any Tax Purposes, the parties agree to treat the transactions
contemplated by this Agreement as indebtedness for all Tax Purposes and not to
take any action that would call into question such treatment.
(signature pages follow)
38
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized officers or attorneys-in-fact as
of the date hereof.
TOWER AUTOMOTIVE RECEIVABLES COMPANY, INC.
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President, CFO and Secretary
Address: 0000 Xxxxxxx Xxxx X.X.
Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
X. X. TOWER CORPORATION
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
Address: 0000 Xxxxxxx Xxxx X.X.
Xxxxx 000
Xxxxx Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
[SELLER/SERVICER SIGNATURE PAGE TO RPA]
BLUE RIDGE ASSET FUNDING CORPORATION
BY: WACHOVIA BANK, N.A., ITS ATTORNEY-IN-FACT
By: /s/ XXXXX X. XXXXXXX
-----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
Address: Blue Ridge Asset Funding Corporation
000 Xxxxx Xxxx Xxxxxx
Xxxxxxx-Xxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
WACHOVIA BANK, N.A., as a Liquidity Bank and as Agent
By: /s/ XXXXX XXXXXXXXX
-----------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
Address: Wachovia Bank, NA
000 Xxxxxxxxx Xxxxxx, 26th Floor
GA-31261
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Address: Blue Ridge Asset Funding Corporation
c/o AMACAR Group, LLC
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
[WACHOVIA/BLUE RIDGE SIGNATURE PAGE TO RPA]
EXHIBIT I
DEFINITIONS
AS USED IN THIS AGREEMENT, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING
MEANINGS (SUCH MEANINGS TO BE EQUALLY APPLICABLE TO BOTH THE SINGULAR AND PLURAL
FORMS OF THE TERMS DEFINED):
"ADJUSTED DILUTION RATIO" means, at any time, the rolling average of
the Dilution Ratio for the 12 Calculation Periods then most recently ended.
"ADVERSE CLAIM" means a lien, security interest, charge or encumbrance,
or other right or claim in, of or on any Person's assets or properties in favor
of any other Person.
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person or any Subsidiary of such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the
management or policies of the controlled Person, whether through ownership of
stock, by contract or otherwise.
"AGENT" has the meaning set forth in the preamble to this Agreement.
"AGENT'S ACCOUNT" means account #8735-098787 at Wachovia Bank, N.A.,
ABA #000000000.
"AGGREGATE INVESTED AMOUNT" means, on any date of determination, the
aggregate Invested Amount of all Receivable Interests outstanding on such date.
"AGGREGATE REDUCTION" has the meaning specified in Section 1.3.
"AGGREGATE UNPAIDS" means, at any time, an amount equal to the sum of
(i) the Aggregate Invested Amount, plus (ii) all Recourse Obligations (whether
due or accrued) at such time.
"AGREEMENT" means this Receivables Purchase Agreement, as it may be
amended or modified and in effect from time to time.
"ALTERNATE BASE RATE" means for any day, the rate per annum equal to
the higher as of such day of (i) the Prime Rate, or (ii) one-half of one percent
(0.50%) above the Federal Funds Effective Rate. For purposes of determining the
Alternate Base Rate for any day, changes in the Prime Rate or the Federal Funds
Rate shall be effective on the date of each such change.
"AMORTIZATION DATE" means the earliest to occur of (i) the Business Day
immediately prior to the occurrence of an Event of Bankruptcy with respect to
any Seller Party, (ii) the Business Day specified in a written notice from the
Agent following the occurrence of any other Amortization Event, and (iii) the
date which is the earlier of (A) the last day of the
I-1
Required Notice Period with respect to the Invested Amount then outstanding and
(B) five (5) Business Days after the Agent's receipt of written notice from
Seller that it wishes to terminate the facility evidenced by this Agreement.
"AMORTIZATION EVENT" has the meaning specified in Article IX.
"APPROVED BUSINESS UNIT" means those business units of the Originators
listed on Schedule B hereto.
"AUTHORIZED OFFICER" means, with respect to any Person, its president,
corporate controller, treasurer or chief financial officer.
"BLUE RIDGE" has the meaning set forth in the preamble to this
Agreement.
"BLUE RIDGE'S PORTION" means, on any date of determination, the sum of
the percentages represented by the Receivable Interests.
"BROKEN FUNDING COSTS" means for any Receivable Interest which: (i) has
its Invested Amount reduced without compliance by Seller with the notice
requirements hereunder or (ii) does not become subject to an Aggregate Reduction
following the delivery of any Reduction Notice or (iii) is assigned by Blue
Ridge to the Liquidity Banks under the Liquidity Agreement or terminated prior
to the date on which it was originally scheduled to end; an amount equal to the
excess, if any, of (A) the CP Costs or Yield (as applicable) that would have
accrued during the remainder of the Interest Periods or the tranche periods for
Commercial Paper determined by the Agent to relate to such Receivable Interest
(as applicable) subsequent to the date of such reduction, assignment or
termination (or in respect of clause (ii) above, the date such Aggregate
Reduction was designated to occur pursuant to the Reduction Notice) of the
Invested Amount of such Receivable Interest if such reduction, assignment or
termination had not occurred or such Reduction Notice had not been delivered,
over (B) the sum of (x) to the extent all or a portion of such Invested Amount
is allocated to another Receivable Interest, the amount of CP Costs or Yield
actually accrued during the remainder of such period on such Invested Amount for
the new Receivable Interest, and (y) to the extent such Invested Amount is not
allocated to another Receivable Interest, the income, if any, actually received
during the remainder of such period by the holder of such Receivable Interest
from investing the portion of such Invested Amount not so allocated. All Broken
Funding Costs shall be due and payable hereunder upon demand.
"BUSINESS DAY" means any day on which banks are not authorized or
required to close in New York, New York, Detroit, Michigan or Atlanta, Georgia,
and The Depository Trust Company of New York is open for business, and, if the
applicable Business Day relates to any computation or payment to be made with
respect to the LIBO Rate, any day on which dealings in dollar deposits are
carried on in the London interbank market.
"CALCULATION PERIOD" means a calendar month or portion thereof which
elapses during the term of this Agreement. The first Calculation Period shall
commence on the date of the initial Purchase of the Receivables and the final
Calculation Period shall terminate on the Facility Termination Date.
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"CHANGE OF CONTROL" means any of (i) the acquisition by any "person" or
"group" (as such terms are used in sections 13(d) and 14(d) of the Exchange Act)
(other than Permitted Holders) at any time of beneficial ownership of thirty
percent (30%) or more of the outstanding capital stock of the Performance
Guarantor on a fully-diluted basis, (ii) the failure of individuals who are
members of the board of directors of the Performance Guarantor on the date
hereof (together with any new or replacement directors whose initial nomination
for election was approved by a majority of the directors who were either
directors on the date hereof or previously so approved) to constitute a majority
of the board of directors of the Performance Guarantor or (iii) the failure of
the Performance Guarantor to own directly or indirectly 100% of the outstanding
capital stock of the Seller.
"COLLECTION ACCOUNT" means each concentration account, depositary
account, lock-box account or similar account in which any Collections are
collected or deposited and which is listed on Exhibit IV.
"COLLECTION ACCOUNT AGREEMENT" means an agreement substantially in the
form of Exhibit VI among an Originator, Servicer, Seller, the Agent and a
Collection Bank.
"COLLECTION BANK" means, at any time, any of the banks holding one or
more Collection Accounts.
"COLLECTION NOTICE" means a notice, in substantially the form of Annex
A to Exhibit VI, from the Agent to a Collection Bank.
"COLLECTIONS" means, with respect to any Receivable, all cash
collections and other cash proceeds in respect of such Receivable, including,
without limitation, all Finance Charges or other related amounts accruing in
respect thereof and all cash proceeds of Related Security with respect to such
Receivable; provided, however, that, while Tower is the Servicer, late payment
charges, collection fees and extension fees shall not be considered to be
Collections hereunder.
"COMMERCIAL PAPER" means promissory notes of Blue Ridge issued by Blue
Ridge in the commercial paper market.
"CONTINGENT OBLIGATION" means, as to any Person, any direct or indirect
liability of that Person, whether or not contingent, with or without recourse,
(a) with respect to any Indebtedness, lease, dividend, letter of credit or other
obligation (the "primary obligations") of another Person (the "primary
obligor"), including any obligation of that Person (i) to purchase, repurchase
or otherwise acquire such primary obligations or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any such primary
obligation, or to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency or any balance sheet
item, level of income or financial condition of the primary obligor, (iii) to
purchase property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation, or (iv) otherwise to assure or hold
harmless the holder of any such primary obligation against loss in respect
thereof (each, a "Guaranty Obligation"); (b) with respect to any Surety
Instrument issued for the account of that Person or as to which that Person
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is otherwise liable for reimbursement of drawings or payments; (c) to purchase
any materials, supplies or other property from, or to obtain the services of,
another Person if the relevant contract or other related document or obligation
requires that payment for such materials, supplies or other property, or for
such services, shall be made regardless of whether delivery of such materials,
supplies or other property is ever made or tendered, or such services are ever
performed or tendered, or (d) in respect of any Swap Contract. The amount of any
Contingent Obligation shall, in the case of Guaranty Obligations, be deemed
equal to the stated or determinable amount of the primary obligation in respect
of which such Guaranty Obligation is made or, if not stated or if
indeterminable, the maximum reasonably anticipated liability in respect thereof,
and in the case of other Contingent Obligations other than in respect of Swap
Contracts, shall be equal to the maximum reasonably anticipated liability in
respect thereof and, in the case of Contingent Obligations in respect of Swap
Contracts, shall be equal to the Swap Termination Value.
"CONTRACT" means, with respect to any Receivable, any and all
instruments, agreements, invoices or other writings pursuant to which such
Receivable arises or which evidences such Receivable.
"CP COSTS" means, for each day, the sum of (i) discount or interest
accrued on Pooled Commercial Paper on such day, plus (ii) any and all accrued
commissions in respect of placement agents and Commercial Paper dealers, and
issuing and paying agent fees incurred, in respect of such Pooled Commercial
Paper for such day, plus (iii) other costs associated with funding small or
odd-lot amounts with respect to all receivable purchase or financing facilities
which are funded by Pooled Commercial Paper for such day, minus (iv) any accrual
of income net of expenses received on such day from investment of collections
received under all receivable purchase or financing facilities funded
substantially with Pooled Commercial Paper, minus (v) any payment received on
such day net of expenses in respect of Broken Funding Costs related to the
prepayment of any investment of Blue Ridge pursuant to the terms of any
receivable purchase or financing facilities funded substantially with Pooled
Commercial Paper. In addition to the foregoing costs, if Seller shall request
any Purchase during any period of time determined by the Agent reasonably and in
good faith to result in incrementally higher CP Costs applicable to such
Purchase, the principal associated with any such Purchase shall, during such
period, be deemed to be funded by Blue Ridge in a special pool (which may
include capital associated with other receivable purchase or financing
facilities) for purposes of determining such additional CP Costs applicable only
to such special pool and charged each day during such period against such
principal.
"CREDIT AND COLLECTION POLICY" means Seller's credit and collection
policies and practices relating to Contracts and Receivables existing on the
date hereof.
"CUT-OFF DATE" means the last day of a Calculation Period.
"DAYS SALES OUTSTANDING" means, as of any day, an amount equal to the
product of (x) 91, multiplied by (y) the amount obtained by dividing (i) the
aggregate outstanding balance of Receivables originated by an Approved Business
Unit as of the most recent Cut-Off Date, by (ii) the aggregate amount of
Receivables originated by an Approved Business Unit
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created during the three (3) Calculation Periods including and immediately
preceding such Cut-Off Date.
"DEEMED COLLECTIONS" means Collections deemed received by Seller under
Section 1.4(a).
"DEFAULT RATE" means a rate per annum equal to the sum of (i) the
Alternate Base Rate plus (ii) 2.00%, changing when and as the Alternate Base
Rate changes.
"DEFAULTED RECEIVABLE" means a Receivable originated by an Approved
Business Unit: (i) as to which the Obligor thereof has suffered an Event of
Bankruptcy; (ii) which, consistent with the Credit and Collection Policy, would
be written off Seller's, any Originator's or Servicer's books as uncollectible;
(iii) as to which any payment, or part thereof, remains unpaid for either 61
days or more from the original due date for such payment or 91 days or more from
the original invoice date for such payment, as applicable, for each Approved
Business Unit consistent with its ordinary business practices; or (iv) as to
which payments have been extended, or the terms of the payment thereof rewritten
other than as permitted by this Agreement.
"DELINQUENCY RATIO" means, at any time, a percentage equal to (i) the
aggregate Outstanding Balance of all Receivables that were Delinquent
Receivables at such time divided by (ii) the aggregate Outstanding Balance of
all Receivables originated by Approved Business Units at such time.
"DELINQUENT RECEIVABLE" means a Receivable originated by an Approved
Business Unit as to which any payment, or part thereof, remains unpaid for
either 31-60 days from the original due date for such payment or 61-90 days from
the original invoice date for such payment, as applicable for each Approved
Business Unit consistent with its business practices.
"DEMAND ADVANCE" means any advance made by Seller to Tower at any time
while it is acting as the Servicer, which advance (a) is payable upon demand,
(b) is not evidenced by an instrument, chattel paper or a certificated security,
(c) bears interest at a market rate determined by Seller and the Servicer from
time to time, (d) is not subordinated to any other Indebtedness or obligation of
the Servicer, and (e) may not be offset by Tower against amounts due and owing
from Seller to it under its Subordinated Note; PROVIDED, HOWEVER, that no Demand
Advance may be made after the Facility Termination Date or on any date prior to
the Facility Termination Date on which an Amortization Event or an Unmatured
Amortization Event exists and is continuing.
"DILUTION" means the amount of any reduction or cancellation of the
Outstanding Balance of a Receivable originated by an Approved Business Unit as
described in Section 1.4(a).
"DILUTION HORIZON RATIO" means, as of any Cut-off Date, a ratio
(expressed as a decimal), computed by dividing (i) the aggregate sales generated
by the Approved Business Units during the two Calculation Periods ending on such
Cut-Off Date, by (ii) the Net Pool Balance as of such Cut-Off Date.
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"DILUTION RATIO" means, as of any Cut-Off Date, a ratio (expressed as a
percentage), computed by dividing (i) the total amount of decreases in
Outstanding Balances due to Dilutions during the previous Calculation Period
ending on such Cut-Off Date, by (ii) the aggregate sales generated by the
Approved Business Units during the second Calculation Period prior to the
Calculation Period ending on such Cut-Off Date.
"DILUTION RESERVE" means, for any Calculation Period, the product
(expressed as a percentage) of:
(a) the sum of (i) two (2) times the Adjusted Dilution Ratio as of the
immediately preceding Cut-Off Date, plus (ii) the Dilution Volatility
Component as of the immediately preceding Cut-Off Date, TIMES
(b) the Dilution Horizon Ratio as of the immediately preceding Cut-Off
Date.
"DILUTION VOLATILITY COMPONENT" means the product (expressed as a
percentage) of (i) the difference between (a) the highest three (3)-month
rolling average Dilution Ratio over the past 12 Calculation Periods and (b) the
Adjusted Dilution Ratio, and (ii) a fraction, the numerator of which is equal to
the amount calculated in (i)(a) of this definition and the denominator of which
is equal to the amount calculated in (i)(b) of this definition.
"DOWNGRADED LIQUIDITY BANK" means a Liquidity Bank which has been the
subject of a Downgrading Event.
"DOWNGRADING EVENT" with respect to any Person means the lowering of
the rating with regard to the short-term securities of such Person to below (i)
A-1 by S&P, or (ii) P-1 by Xxxxx'x.
"ELIGIBLE ASSIGNEE" means a commercial bank having a combined capital
and surplus of at least $250,000,000 with a rating of its (or its parent holding
company's) short-term securities equal to or higher than (i) A-1 by S&P and (ii)
P-1 by Xxxxx'x.
"ELIGIBLE RECEIVABLE" means, at any time, a Receivable:
(i) the Obligor of which (a) if a natural person, is a resident of
the United States or, if a corporation or other business organization, is
qualified to conduct business in the United States and has its chief
executive office in the United States; (b) is not an Affiliate of any of
the parties hereto; and (c) is not a government or a governmental
subdivision or agency;
(ii) which is not a Defaulted Receivable at such time or owing from
an Obligor as to which more than 50% of the aggregate Outstanding Balance
of all Receivables owing from such Obligor are Defaulted Receivables,
(iii) which is not a Delinquent Receivable,
I-6
(iv) which by its terms is due and payable within 30 days of the
original billing date therefor, has not had its payment terms extended and
the Outstanding Balance of which has not been adjusted more than once,
(v) which is an "account" within the meaning of Section 9-106 (or
successor section), of the UCC of all applicable jurisdictions,
(vi) which is denominated and payable only in United States dollars
in the United States,
(vii) which arises under a Contract which, together with such
Receivable, is in full force and effect and constitutes the legal, valid
and binding obligation of the related Obligor enforceable against such
Obligor in accordance with its terms,
(viii) which arises under a Contract which (A) does not require the
Obligor under such Contract to consent to the transfer, sale, pledge or
assignment of the rights and duties of the applicable Originator or any of
its assignees under such Contract and (B) does not contain a
confidentiality provision that purports to restrict the ability of Blue
Ridge to exercise its rights under this Agreement, including, without
limitation, its right to review the Contract,
(ix) which arises under a Contract that contains an obligation to
pay a specified sum of money, contingent only upon the sale of goods or the
provision of services by the applicable Originator,
(x) which, together with the Contract related thereto, does not
contravene in any material respect any law, rule or regulation applicable
thereto (including, without limitation, any law, rule and regulation
relating to truth in lending, fair credit billing, fair credit reporting,
equal credit opportunity, fair debt collection practices and privacy) and
with respect to which no part of the Contract related thereto is in
violation of any such law, rule or regulation in any material respect if
such violation would impair the collectibility of such Receivable,
(xi) which satisfies in all material respects all applicable
requirements of the Credit and Collection Policy,
(xii) which was generated in the ordinary course of the applicable
Originator's business,
(xiii) which arises solely from the sale of goods or the provision
of services to the related Obligor by the applicable Originator, and not by
any other Person (in whole or in part),
(xiv) which is not a Receivable for tooling, cost recoveries or
steel recoveries;
I-7
(xv) which is not subject to any dispute, counterclaim, right of
rescission, set-off, counterclaim or any other defense (including defenses
arising out of violations of usury laws) of the applicable Obligor against
the applicable Originator or any other Adverse Claim, and the Obligor
thereon holds no right as against such Originator to cause such Originator
to repurchase the goods or merchandise the sale of which shall have given
rise to such Receivable (except with respect to sale discounts effected
pursuant to the Contract, or defective goods returned in accordance with
the terms of the Contract); PROVIDED, HOWEVER, that if such dispute,
offset, counterclaim or defense affects only a portion of the Outstanding
Balance of such Receivable, then such Receivable may be deemed an Eligible
Receivable to the extent of the portion of such Outstanding Balance which
is not so affected, and PROVIDED, FURTHER, that Receivables of any Obligor
which has any accounts payable by the applicable Originator or by a
wholly-owned Subsidiary of such Originator (thus giving rise to a potential
offset against such Receivables) may be treated as Eligible Receivables to
the extent that the Obligor of such Receivables has agreed pursuant to a
written agreement in form and substance satisfactory to the Agent, that
such Receivables shall not be subject to such offset,
(xvi) as to which the applicable Originator has satisfied and fully
performed all obligations on its part with respect to such Receivable
required to be fulfilled by it, and no further action is required to be
performed by any Person with respect thereto other than payment thereon by
the applicable Obligor,
(xvii) as to which each of the representations and warranties
contained in Sections 5.1(g), (i), (j), (r), (s), (t) and (u) is true and
correct in all material respects (unless such provisions themselves have
materiality thresholds),
(xviii) all right, title and interest to and in which has been
validly transferred by the applicable Originator directly to Seller under
and in accordance with the Receivables Sale Agreement, and Seller has good
and marketable title thereto free and clear of any Adverse Claim except as
created pursuant to the Transaction Documents, and
(xix) which is a Receivable originated by an Approved Business
Unit.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) under common control with Tower within the meaning of Section
414(b) or (c) of the Tax Code (and Sections 414(m) and (o) of the Tax Code for
purposes of provisions relating to Section 412 of the Tax Code).
"EVENT OF BANKRUPTCY" shall be deemed to have occurred with respect to
a Person if either:
(a) a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding up, or
composition or readjustment of debts of such
I-8
Person, the appointment of a trustee, receiver, custodian, liquidator,
assignee, sequestrator or the like for such Person or all or substantially
all of its assets, or any similar action with respect to such Person under
any law relating to bankruptcy, insolvency, reorganization, winding up or
composition or adjustment of debts, and such case or proceeding shall
continue undismissed, or unstayed and in effect, for a period of 60
consecutive days;
(b) such Person shall commence a voluntary case or other proceeding
under any applicable bankruptcy, insolvency, reorganization, debt
arrangement, dissolution or other similar law now or hereafter in effect,
or shall consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee (other than a trustee under a deed of trust,
indenture or similar instrument), custodian, sequestrator (or other similar
official) for, such Person or for any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall be
adjudicated insolvent, or admit in writing its inability to pay its debts
generally as they become due, or, if a corporation or similar entity, its
board of directors shall vote to implement any of the foregoing.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the regulations promulgated thereunder.
"FACILITY ACCOUNT" means Seller's account no. 881813 at Bank One, N.A.
"FACILITY TERMINATION DATE" means the earlier of (i) the Liquidity
Termination Date and (ii) the Amortization Date.
"FACILITY TERMINATION NOTICE" means a notice in substantially the form
of Annex B to Exhibit VI from the Agent to the Collection Bank.
"FEDERAL BANKRUPTCY CODE" means Title 11 of the United States Code
entitled "Bankruptcy," as amended and any successor statute thereto.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a fluctuating
interest rate per annum for each day during such period equal to (i) the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the preceding
Business Day) by the Federal Reserve Bank of New York in the Composite Closing
Quotations for U.S. Government Securities; or (ii) if such rate is not so
published for any day which is a Business Day, the average of the quotations at
approximately 11:30 a.m. (New York time) for such day on such transactions
received by the Agent from three federal funds brokers of recognized standing
selected by it.
"FEE LETTER" means that certain letter agreement dated as of June 19,
2001 between Seller and the Agent, as it may be amended, restated or otherwise
modified and in effect from time to time.
"FINAL PAYOUT DATE" means the date on which all Aggregate Unpaids have
been paid in full and the Purchase Limit has been reduced to zero.
I-9
"FINANCE CHARGES" means, with respect to a Contract, any finance,
interest, late payment charges or similar charges owing by an Obligor pursuant
to such Contract.
"FORD" means Ford Motor Company.
"FORD ADDITIONAL AVAILABILITY AMOUNT" means, at any time, an amount
equal to the lesser of (a) the Ford Maximum Additional Availability Limit and
(b) the difference between (i) the Ford Excess Concentration and (ii) the Ford
Required Reserve.
"FORD EXCESS CONCENTRATION" means, at any time, the difference between
(a) the Outstanding Balance of Eligible Receivables owed by Ford and (b) the
product of (i) the Obligor Concentration Limit for Ford times (ii) the aggregate
Outstanding Balance of Eligible Receivables.
"FORD MAXIMUM ADDITIONAL AVAILABILITY LIMIT" means initially
$20,000,000. At any time prior to the occurrence of an Amortization Event, with
at least five (5) Business Days notice, the Seller may request that this limit
be permanently reduced by an amount not less than $1,000,000 and such reduction
shall be an integral multiple of $1,000,000. No such reduction in the Ford
Maximum Additional Availability Limit will be permitted which results in the
Receivable Interest at that time being greater than 100% prior to the occurrence
of an Amortization Event. If Ford is downgraded by Moody's or S&P, the Ford
Maximum Additional Availability Limit may be reduced or revoked by the Agent.
"FORD REQUIRED RESERVE" means, at any time the product of (a) the sum
of (i) the Dilution Reserve, (ii) the Servicing Reserve, and (iii) the Yield
Reserve times (b) the Ford Excess Concentration.
"FUNDING AGREEMENT" means (i) this Agreement, (ii) the Liquidity
Agreement and (iii) any other agreement or instrument executed by any Funding
Source with or for the benefit of Blue Ridge.
"FUNDING SOURCE" means (i) any Liquidity Bank or (ii) any insurance
company, bank or other funding entity providing liquidity, credit enhancement or
back-up purchase support or facilities to Blue Ridge.
"GAAP" means generally accepted accounting principles in effect from
time to time in the United States of America.
"INCREMENTAL PURCHASE" means a purchase of one or more Receivable
Interests which increases the total outstanding Aggregate Invested Amount
hereunder.
"INDEBTEDNESS" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into and accrued expenses incurred, in each case in the
ordinary course of business on ordinary terms); (c) all non-contingent
reimbursement or payment obligations with respect to Surety Instruments; (d) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses; (e) all
I-10
indebtedness created or arising under any conditional sale or other title
retention agreement, or incurred as financing, in either case with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property); (f) all obligations with respect to
capital leases; (g) all indebtedness referred to in clauses (a) through (f)
above secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any lien upon or in property
(including accounts and contracts rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness;
and (h) all Guaranty Obligations (as defined in the definition of "Contingent
Obligations" above) in respect of indebtedness or obligations of others of the
kinds referred to in clauses (a) through (g) above.
"INDEMNIFIED AMOUNTS" has the meaning specified in Section 10.1.
"INDEMNIFIED PARTY" has the meaning specified in Section 10.1.
"INDEPENDENT DIRECTOR" shall mean a member of the Board of Directors of
Seller who is not at such time, and has not been at any time during the
preceding five (5) years: (A) a director, officer, employee or affiliate of
Performance Guarantor, any Originator or any of their respective Subsidiaries or
Affiliates (other than Seller), or (B) the beneficial owner (at the time of such
individual's appointment as an Independent Director or at any time thereafter
while serving as an Independent Director) of any of the outstanding common
shares of Seller, any Originator, or any of their respective Subsidiaries or
Affiliates, having general voting rights.
"INTEREST PERIOD" means, with respect to any Receivable Interest funded
through a Liquidity Funding:
(a) if Yield for such Receivable Interest is calculated on the basis of
the LIBO Rate, a period of one, two, three or six months, or such other
period as may be mutually agreeable to the Agent and Seller, commencing on
a Business Day selected by Seller or the Agent pursuant to this Agreement.
Such Interest Period shall end on the day in the applicable succeeding
calendar month which corresponds numerically to the beginning day of such
Interest Period, PROVIDED, HOWEVER, that if there is no such numerically
corresponding day in such succeeding month, such Interest Period shall end
on the last Business Day of such succeeding month; or
(b) if Yield for such Receivable Interest is calculated on the basis of
the Alternate Base Rate, a period commencing on a Business Day selected by
Seller and agreed to by the Agent, PROVIDED THAT no such period shall
exceed one month.
If any Interest Period would end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, PROVIDED,
HOWEVER, that in the case of Interest Periods corresponding to the LIBO Rate, if
such next succeeding Business Day falls in a new month, such Interest Period
shall end on the immediately preceding Business Day. In the case of any Interest
Period which commences before the Facility Termination Date and would otherwise
end on a date occurring after the Facility Termination Date, such Interest
Period shall end on the
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Facility Termination Date. The duration of each Interest Period which commences
after the Facility Termination Date shall be of such duration as selected by the
Agent.
"INVESTED AMOUNT" of any Receivable Interest means, at any time, (A)
the Purchase Price of such Receivable Interest, minus (B) the sum of the
aggregate amount of Collections and other payments received by the Agent which
in each case are applied to reduce such Invested Amount in accordance with the
terms and conditions of this Agreement; PROVIDED THAT such Invested Amount shall
be restored (in accordance with Section 2.4) in the amount of any Collections or
other payments so received and applied if at any time the distribution of such
Collections or payments are rescinded, returned or refunded for any reason.
"LIBO RATE" means, for any Interest Period, the rate per annum
determined on the basis of the offered rate for deposits in U.S. dollars of
amounts equal or comparable to the Invested Amount offered for a term comparable
to such Interest Period, which rates appear on a Bloomberg L.P. terminal,
displayed under the address "US0001M (Index) Q (Go)" effective as of 11:00 A.M.,
London time, two Business Days prior to the first day of such Interest Period,
PROVIDED that if no such offered rates appear on such page, the LIBO Rate for
such Interest Period will be the arithmetic average (rounded upwards, if
necessary, to the next higher 1/100th of 1%) of rates quoted by not less than
two major banks in New York, New York, selected by the Agent, at approximately
10:00 a.m.(New York time), two Business Days prior to the first day of such
Interest Period, for deposits in U.S. dollars offered by leading European banks
for a period comparable to such Interest Period in an amount comparable to the
Invested Amount, divided by (b) one minus the maximum aggregate reserve
requirement (including all basic, supplemental, marginal or other reserves)
which is imposed against the Agent in respect of Eurocurrency liabilities, as
defined in Regulation D of the Board of Governors of the Federal Reserve System
as in effect from time to time (expressed as a decimal), applicable to such
Interest Period plus (ii) the Applicable Margin (as defined in the Tower Credit
Agreement). The LIBO Rate shall be rounded, if necessary, to the next higher
1/16 of 1%.
"LIQUIDITY AGREEMENT" means that certain Liquidity Asset Purchase
Agreement dated as of June 19, 2001, by and among Blue Ridge, the Agent and the
Liquidity Banks from time to time party thereto, as the same may be amended,
restated and/or otherwise modified from time to time in accordance with the
terms thereof.
"LIQUIDITY BANK" means each bank from time to time party to the
Liquidity Agreement (other than the Agent acting in its capacity as the Agent
thereunder).
"LIQUIDITY COMMITMENT" means, as to each Liquidity Bank, its commitment
under the Liquidity Agreement. The Liquidity Commitments, in the aggregate,
shall equal 102% of the Purchase Limit hereunder.
"LIQUIDITY FUNDING" means a purchase by any Liquidity Bank pursuant to
its Liquidity Commitment of all or any portion of, or any undivided interest in,
a Receivable Interest.
"LIQUIDITY TERMINATION DATE" means the earlier to occur of the
following:
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(a) the date on which the Liquidity Banks' Liquidity Commitments
expire, cease to be available to Blue Ridge or otherwise cease to be in full
force and effect;
(b) the date on which a Downgrading Event with respect to a Liquidity
Bank shall have occurred and been continuing for not less than 45 days, and
either (i) the Downgraded Liquidity Bank shall not have been replaced by an
Eligible Assignee pursuant to the Liquidity Agreement, or (ii) the Liquidity
Commitment of such Downgraded Liquidity Bank shall not have been funded or
collateralized in such a manner that will avoid a reduction in or withdrawal
of the credit rating applied to the Commercial Paper to which such Liquidity
Agreement applies by any of the rating agencies then rating such Commercial
Paper; or
(c) the date on which a Purchaser shall become an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
"LOCK-BOX" means each locked postal box with respect to which a bank
who has executed a Collection Account Agreement has been granted exclusive
access for the purpose of retrieving and processing payments made on the
Receivables and which is listed on Exhibit IV.
"LOSS RESERVE" means, for any Calculation Period, the product
(expressed as a percentage) of (a) 2.0, times (b) the highest three-month
rolling average Loss Reserve Ratio during the 12 Calculation Periods ending on
the immediately preceding Cut-Off Date, times (c) the Loss Reserve Horizon Ratio
as of the immediately preceding Cut-Off Date.
"LOSS RESERVE HORIZON RATIO" means, as of any Cut-Off Date, the ratio
(expressed as a decimal) computed by dividing (i) the aggregate sales generated
by the Approved Business Units during the two (2) Calculation Periods ending on
such Cut-Off Date, by (ii) the Net Pool Balance as of such Cut-off Date.
"LOSS RESERVE RATIO" means, as of any Cut-Off Date, the ratio
(expressed as a percentage) computed by dividing (x) the total amount of
Receivables which became Delinquent Receivables during the Calculation Period
that includes such Cut-Off Date, by (y) the aggregate sales generated by the
Approved Business Units during the Calculation Period occurring two (2) months
prior to the Calculation Period ending on such Cut-Off Date.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
financial condition or operations of any Seller Party and its Subsidiaries,
taken as a whole, (ii) the ability of any Seller Party to perform its
obligations under this Agreement or the Performance Guarantor to perform its
obligations under the Performance Undertaking, (iii) the legality, validity or
enforceability of this Agreement or any other Transaction Document, (iv) the
Agent's security interest, for the benefit of the Secured Parties, in the
Receivables generally or in any significant portion of the Receivables, the
Related Security or the Collections with respect thereto, or (v) the
collectibility of the Receivables generally or of any material portion of the
Receivables.
"MATERIAL ORIGINATOR" means each of Tower Automotive Products Company,
Inc., a Delaware corporation and any other Originator that originates more than
20% of the Receivables in existence during the last twelve (12) Calculation
Periods.
I-13
"MATERIAL DOMESTIC RESTRICTED SUBSIDIARY" means, at any time any
Restricted Subsidiary (as defined in the Tower Credit Agreement) of the
Performance Guarantor which is organized under the laws of the United States and
which, together with its Subsidiaries, has either (i) at least 10% of the
consolidated total assets of the Performance Guarantor and its Subsidiaries or
(ii) at least 10% of the consolidated total revenues of the Performance
Guarantor and its Subsidiaries for the last fiscal year.
"MONTHLY REPORT" means a report, in substantially the form of Exhibit
VIII hereto (appropriately completed), furnished by the Servicer to the Agent
pursuant to Section 8.5.
"MONTHLY REPORTING DATE" means the 15th day of each month after the
date of this Agreement (or if any such day is not a Business Day, the next
succeeding Business Day thereafter) or such other days of any month as Agent may
request in connection with Section 8.5 hereof.
"MOODY'S" means Xxxxx'x Investors Service, Inc.
"NET POOL BALANCE" means, at any time, the aggregate Outstanding
Balance of all Eligible Receivables at such time reduced by the aggregate amount
by which the Outstanding Balance of all Eligible Receivables of each Obligor and
its Affiliates exceeds the Obligor Concentration Limit for such Obligor.
"NET WORTH" on any date means the consolidated stockholders equity of
the Performance Guarantor and its Restricted Subsidiaries on such date.
"OBLIGOR" means a Person obligated to make payments pursuant to a
Contract.
"OBLIGOR CONCENTRATION LIMIT" means, at any time, in relation to the
aggregate Outstanding Balance of Receivables originated by Approved Business
Units and owed by any single Obligor and its Affiliates (if any), the applicable
concentration limit shall be determined as follows for Obligors who have short
term unsecured debt ratings currently assigned to them by S&P and Moody's (or in
the absence thereof, the equivalent long term unsecured senior debt ratings),
the applicable concentration limit shall be determined according to the
following table:
-----------------------------------------------------------------------------------------------
Allowable % of Eligible
S&P Rating Xxxxx'x Rating Receivables
-----------------------------------------------------------------------------------------------
A-1+ P-1 10%
-----------------------------------------------------------------------------------------------
A-1 P-1 8%
-----------------------------------------------------------------------------------------------
A-2 P-2 6%
-----------------------------------------------------------------------------------------------
A-3 P-3 3%
-----------------------------------------------------------------------------------------------
Below A-3 or Not Rated by either Below P-3 or Not Rated by
S&P or Moody's either S&P or Moody's 2.5%
-----------------------------------------------------------------------------------------------
; PROVIDED, HOWEVER, that (a) if any Obligor has a split rating, the applicable
rating will be the lower of the two, (b) if any Obligor does not have either a
long term unsecured debt rating or a short term unsecured debt rating from both
S&P and Xxxxx'x, is not rated by either S&P or
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Moody's or has either a long-term unsecured debt rating or a short term
unsecured debt rating from either S&P or Moody's but does not have a long term
unsecured debt rating nor a short term unsecured debt rating from the other
rating agency, the applicable Obligor Concentration Limit shall be the one set
forth in the last line of the table above, and (c) subject to satisfaction of
the Rating Agency Condition and/or an increase in the percentage set forth in
clause (a)(i) of the definition of "REQUIRED RESERVE," upon Seller's request
from time to time, the Agent may agree to a higher percentage of Eligible
Receivables for a particular Obligor and its Affiliates (each such higher
percentage, a "SPECIAL CONCENTRATION LIMIT"), it being understood that any
Special Concentration Limit may be revoked by the Agent if the Obligor subject
thereto is downgraded by Moody's or S&P. If any Special Concentration Limit is
revoked by the Agent, the Obligor Concentration Limit for such Obligor may, in
the Agent's discretion, be determined according to the chart above or be set at
such higher percentage as otherwise agreed by the Agent upon the Seller's
request, as of the date hereof. As of the date hereof, the Agent has agreed to a
Special Concentration Limit of (i) 22% of the Unpaid Balance of Eligible
Receivables for Ford and (ii) 18% of the Unpaid Balance of Eligible Receivables
for Daimler Chrysler AG.
"ORIGINATOR" means each of Tower Automotive Products Company, Inc.,
Tower Automotive Technology Products, Inc., Trylon Corporation, Tower Automotive
Bardstown, Inc., Tower Automotive Michigan Limited Partnership and Tower
Automotive Tool, LLC, in its respective capacity as a seller under the
Receivables Sale Agreement.
"OUTSTANDING BALANCE" of any Receivable at any time means the then
outstanding principal balance thereof.
"PARENT" means Tower Automotive, Inc., a Delaware corporation and its
successors.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"PENSION PLAN" means a pension plan (as defined in Section 3(2) of
ERISA) subject to Title IV of ERISA which Performance Guarantor sponsors or
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding five plan years.
"PERFORMANCE GUARANTOR" means X. X. Tower Corporation, in its capacity
as Performance Guarantor pursuant to the Performance Undertaking.
"PERFORMANCE UNDERTAKING" means that certain Performance Undertaking,
dated as of June 19, 2001 by Performance Guarantor in favor of Seller,
substantially in the form of Exhibit X, as the same may be amended, restated or
otherwise modified from time to time.
"PERMITTED HOLDERS" shall have the same definition as in the Tower
Credit Agreement, as amended from time to time.
"PERMITTED RESTRUCTURING" means any merger, consolidation or similar
combination of an Originator (i) with another Originator, and/or (ii) with and
into a newly
I-15
formed entity that is (A) domiciled in the United States of America, and (B)
wholly-owned, directly or indirectly, by Tower, with no assets (other than its
initial paid-in capital) and no liabilities (other than minimal organization
costs) for the purpose of changing its legal form from a corporation,
partnership or limited liability company domiciled in one state of the United
States to a corporation, partnership or limited liability company domiciled in
another state, from a corporation to a partnership or limited liability company,
from a partnership to a corporation or limited liability company, or from a
limited liability company to a partnerships or corporation, as the case may be,
(iii) with any Person engaged in a similar line of business as such Originator
which would not, after giving effect to such merger, consolidation or similar
combination, cause such Originator to be the Originator of Receivables with an
aggregate Outstanding Balance of more than 20% of the aggregate Outstanding
Balance thereof immediately prior to such merger, consolidation or similar
combination, and/or (iv) with any other Person to whom the Agent gives its prior
written consent, SO LONG AS: (1) the successor or surviving entity
unconditionally assumes such Originator's (or Originators') respective
obligations under the Transaction Documents to which it is (or they are) a party
immediately prior to giving effect to such combination, (2) prior to the
effectiveness of such combination, all UCC financing statements necessary to
maintain the validity, perfection and priority of Seller's security interest in
Receivables under the Receivables Sale Agreement, and the Agent's ownership or
security interest therein, having been dully executed and filed in all necessary
jurisdictions, and (3) if the surviving entity in such combination(s) is not an
existing party to the Receivables Sale Agreement, all other documents required
to be delivered in connection with a joinder agreement under the Receivables
Sale Agreement have been duly executed and delivered substantially
contemporaneously with such combination(s).
"PERSON" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"PLAN" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which Performance Guarantor or any of its ERISA Affiliates sponsors or
maintains or to which Performance Guarantor or any of its ERISA Affiliates
makes, is making, or is obligated to make contributions and includes any Pension
Plan, other than a Plan maintained outside the United States primarily for the
benefit of Persons who are not U.S. residents.
"POOLED COMMERCIAL PAPER" means Commercial Paper notes of Blue Ridge
subject to any particular pooling arrangement by Blue Ridge, but excluding
Commercial Paper issued by Blue Ridge for a tenor and in an amount specifically
requested by any Person in connection with any agreement effected by Blue Ridge.
"PRIME RATE" means a rate per annum equal to the prime rate of interest
announced from time to time by Wachovia (which is not necessarily the lowest
rate charged to any customer), changing when and as said prime rate changes.
"PROPOSED REDUCTION DATE" has the meaning set forth in Section 1.3.
"PURCHASE" means an Incremental Purchase or a Reinvestment.
I-16
"PURCHASE DATE" means each Business Day on which a Purchase is made
hereunder.
"PURCHASE LIMIT" means $60,000,000.
"PURCHASE NOTICE" has the meaning set forth in Section 1.2.
"PURCHASE PRICE" means, with respect to any Incremental Purchase of a
Receivable Interest, the amount paid to Seller for such Receivable Interest
which shall not exceed the least of (i) the amount requested by Seller in the
applicable Purchase Notice, (ii) the unused portion of the Purchase Limit on the
applicable purchase date and (iii) the excess, if any, of the Net Pool Balance
(less the Required Reserve) on the applicable purchase date over the aggregate
outstanding amount of Aggregate Invested Amount determined as of the date of the
most recent Monthly Report, taking into account such proposed Incremental
Purchase.
"PURCHASED ASSETS" means all of Seller's right, title and interest,
whether now owned and existing or hereafter arising in and to all of the
Receivables, the Related Security, the Collections and all proceeds of the
foregoing.
"PURCHASER" means each Liquidity Bank and Blue Ridge, as applicable.
"RATING AGENCY CONDITION" means that Blue Ridge has received written
notice from S&P and Xxxxx'x that an amendment, a change or a waiver will not
result in a withdrawal or downgrade of the then current ratings on Blue Ridge's
Commercial Paper.
"RECEIVABLE" means all indebtedness and other obligations owed to
Seller or any Originator (at the time it arises, and before giving effect to any
transfer or conveyance under the Receivables Sale Agreement) or in which Seller
or an Originator has a security interest or other interest, including, without
limitation, any indebtedness, obligation or interest constituting an account,
chattel paper, instrument or general intangible, arising in connection with the
sale of goods or the rendering of services by an Originator, and further
includes, without limitation, the obligation to pay any Finance Charges with
respect thereto. Indebtedness and other rights and obligations arising from any
one transaction, including, without limitation, indebtedness and other rights
and obligations represented by an individual invoice, shall constitute a
Receivable separate from a Receivable consisting of the indebtedness and other
rights and obligations arising from any other transaction; provided further,
that any indebtedness, rights or obligations referred to in the immediately
preceding sentence shall be a Receivable regardless of whether the account
debtor or Seller treats such indebtedness, rights or obligations as a separate
payment obligation.
"RECEIVABLE INTEREST" means, at any time, an undivided percentage
ownership interest (computed as set forth below) associated with a designated
amount of Invested Amount, selected pursuant to the terms and conditions hereof
in (i) each Receivable arising prior to the time of the most recent computation
or recomputation of such undivided interest, (ii) all Related Security with
respect to each such Receivable, and (iii) all Collections with respect to, and
other proceeds of, each such Receivable. Each such undivided percentage interest
shall equal:
I-17
IA + RR
----------------------
NPB + FAA
WHERE:
IA = the Invested Amount of such Receivable Interest.
NPB = the Net Pool Balance.
FAA = the Ford Additional Availability Amount
RR = the Required Reserve.
Such undivided percentage ownership interest shall be initially computed on its
date of purchase. Thereafter, until the Facility Termination Date, each
Receivable Interest shall be automatically recomputed (or deemed to be
recomputed) on each day prior to the Facility Termination Date. The variable
percentage represented by any Receivable Interest as computed (or deemed
recomputed) as of the close of the business day immediately preceding the
Facility Termination Date shall remain constant at all times thereafter.
"RECEIVABLES SALE AGREEMENT" means that certain Receivables Sale
Agreement, dated as of June 19, 2001, among the Originators, Tower, in its
capacity as Originator Agent and Seller, as the same may be amended, restated or
otherwise modified from time to time.
"RECORDS" means, with respect to any Receivable, all Contracts and
other documents, books, records and other information (including, without
limitation, computer programs, tapes, disks, punch cards, data processing
software and related property and rights) relating to such Receivable, any
Related Security therefor and the related Obligor.
"RECOURSE OBLIGATIONS" has the meaning set forth in Section 2.1.
"REDUCTION NOTICE" has the meaning set forth in Section 1.3.
"REGULATORY CHANGE" has the meaning set forth in Section 10.2.
"REINVESTMENT" has the meaning set forth in Section 2.2.
"RELATED SECURITY" means, with respect to any Receivable:
(i) all of Seller's interest in the inventory and goods (including
returned or repossessed inventory or goods), if any, the sale of which by
an Originator gave rise to such Receivable, and all insurance contracts
with respect thereto,
(ii) all other security interests or liens and property subject thereto
from time to time, if any, purporting to secure payment of such Receivable,
whether pursuant to the Contract related to such Receivable or otherwise,
together with all financing statements and security agreements describing
any collateral securing such Receivable,
I-18
(iii) all guaranties, letters of credit, insurance and other agreements
or arrangements of whatever character from time to time supporting or
securing payment of such Receivable whether pursuant to the Contract
related to such Receivable or otherwise,
(iv) all service contracts and other contracts and agreements
associated with such Receivable,
(v) all Records related to such Receivable,
(vi) all of Seller's right, title and interest in, to and under the
Receivables Sale Agreement in respect of such Receivable and all of
Seller's right, title and interest in, to and under the Performance
Undertaking,
(vii) all of Seller's right, title and interest in and to the Demand
Advances, and
(viii) all proceeds of any of the foregoing.
"REQUIRED CAPITAL AMOUNT" means, as of the date of determination, an
amount equal to the greater of (a) 3% of the Purchase Limit and (b) the product
of (i) 1.5 times the product of the Loss Reserve Ratio times the Loss Reserve
Horizon Ratio, each as determined from the most recent Monthly Report received
from the Servicer and (ii) the Outstanding Balance of all Receivables originated
by Approved Business Units as of such date as determined from the most recent
Monthly Report received from the Servicer.
"REQUIRED LIQUIDITY BANKS" means, at any time, Liquidity Banks with
Liquidity Commitments in excess of 50% of the aggregate amount of all Liquidity
Commitments.
"REQUIRED NOTICE PERIOD" means the number of days required notice set
forth below applicable to the Aggregate Reduction indicated below:
AGGREGATE REDUCTION REQUIRED NOTICE PERIOD
less than 25% of the Purchase 2 Business Days
Limit
greater than 25% but less than 5 Business Days
50% of the Purchase Limit
greater than 50% of the Purchase 10 Business Days
Limit
"REQUIRED RESERVE" means, on any day during a Calculation Period, the
product of (a) the greater of (i) the Required Reserve Factor Floor and (ii) the
sum of the Loss Reserve, the Yield Reserve, the Dilution Reserve and the
Servicing Reserve, times (b) the Net Pool Balance as of the Cut-Off Date
immediately preceding such Calculation Period.
I-19
"REQUIRED RESERVE FACTOR FLOOR" means, for any Calculation Period, the
sum (expressed as a percentage) of (a) 36% plus (b) the product of the Adjusted
Dilution Ratio and the Dilution Horizon Ratio, in each case, as of the
immediately preceding Cut-Off Date.
"RESTRICTED JUNIOR PAYMENT" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of
capital stock of Seller now or hereafter outstanding, except a dividend payable
solely in shares of that class of stock or in any junior class of stock of
Seller, (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of capital stock of Seller now or hereafter outstanding, (iii) any
payment or prepayment of principal of, premium, if any, or interest, fees or
other charges on or with respect to, and any redemption, purchase, retirement,
defeasance, sinking fund or similar payment and any claim for rescission with
respect to the Subordinated Loans (as defined in the Receivables Sale
Agreement), (iv) any payment made to redeem, purchase, repurchase or retire, or
to obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of capital stock of Seller now or hereafter
outstanding, and (v) any payment of management fees by Seller (except for
reasonable management fees to any Originator or its Affiliates in reimbursement
of actual management services performed).
"RESTRICTED SUBSIDIARY" has the meaning set forth in the Tower Credit
Agreement.
"S&P" means Standard and Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc.
"SECURED PARTIES" means the Indemnified Parties.
"SELLER" has the meaning set forth in the preamble to this Agreement.
"SELLER'S NET WORTH" means, as of the last Business Day of each
calculation period preceding any date of determination in excess, if any, of (a)
the aggregate Outstanding Balance of the Receivables at such time, OVER (b) the
sum of (i) the Aggregate Invested Amount outstanding at such time PLUS (ii) the
aggregate outstanding principal balance of the Subordinated Loans (as defined in
the Receivables Sale Agreement) (including any Subordinated Loan proposed to be
made on the date of determination).
"SELLER PARTIES" has the meaning set forth in the preamble to this
Agreement.
"SERVICER" means at any time the Person (which may be the Agent) then
authorized pursuant to Article VIII to service, administer and collect
Receivables.
"SERVICING FEE" means, for each day in a Calculation Period:
(a) an amount equal to (i) the Servicing Fee Rate TIMES (ii) the
aggregate Outstanding Balance of all Receivables at the close of business
on the Cut-Off Date immediately preceding such Calculation Period, TIMES
(iii) 1/360; or
I-20
(b) on and after the Servicer's reasonable request made at any time
when Tower or one of its Affiliates is no longer acting as Servicer
hereunder, an alternative amount specified by the successor Servicer not
exceeding (i) 110% of such Servicer's reasonable costs and expenses of
performing its obligations under this Agreement during the Calculation
Period during which such request is made, DIVIDED BY (ii) the number of
days in the current Calculation Period.
"SERVICING FEE RATE" means 1.0% per annum.
"SERVICING RESERVE" means, for any Calculation Period, the product
(expressed as a percentage) of (a) the Servicing Fee Rate, TIMES (b) a fraction,
the numerator of which is the highest Days Sales Outstanding for the most recent
12 Calculation Periods and the denominator of which is 360.
"SETTLEMENT DATE" means (A) the 2nd Business Day after each Monthly
Reporting Date, and (B) the last day of the relevant Interest Period in respect
of each Receivable Interest funded through a Liquidity Funding.
"SETTLEMENT PERIOD" means (A) in respect of each Receivable Interest
funded through the issuance of Commercial Paper, the immediately preceding
Calculation Period, and (B) in respect of each Receivable Interest funded
through a Liquidity Funding, the entire Interest Period of such Liquidity
Funding.
"SUBSIDIARY" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, association, limited liability company, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
"SURETY INSTRUMENTS" means all letters of credit (including standby and
commercial), banker's acceptances, bank guaranties, shipside bonds, surety bonds
and similar instruments.
"SWAP CONTRACT" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity swap index swap
or option, bond, note or xxxx option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or any
combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.
"SWAP TERMINATION VALUE" means, in respect of one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amounts determined as the
I-21
xxxx-to-market value(s) for such Swap Contracts, as determined by the Company
based upon one or more mid-market or other readily available quotations provided
by any recognized dealer in such Swap Contracts (which may include any Lender
party to the Tower Credit Agreement, as such term is defined therein.)
"TAX CODE" means the Internal Revenue Code of 1986, as the same may be
amended from time to time.
"TERMINATING TRANCHE" has the meaning set forth in Section 4.3(b).
"TOWER" has the meaning set forth in the Preamble.
"TOWER CREDIT AGREEMENT" means that certain Credit Agreement dated as
of July 25, 2000, among X. X. Tower Corporation, Certain Subsidiaries thereof,
Bank of America, N.A., as Administrative Agent, The Chase Manhattan Bank, as
Syndication Agent and the other financial institutions parties thereto, as the
same may be amended, restated or modified from time to time.
"TRANSACTION DOCUMENTS" means, collectively, this Agreement, each
Purchase Notice, the Receivables Sale Agreement, each Collection Account
Agreement, the Liquidity Agreement, the Performance Undertaking, the Fee Letter,
each Subordinated Note (as defined in the Receivables Sale Agreement) and all
other instruments, documents and agreements executed and delivered in connection
herewith.
"UCC" means the Uniform Commercial Code or any successor statute as
from time to time in effect in the specified jurisdiction.
"UNMATURED AMORTIZATION EVENT" means an event which, with the passage
of time or the giving of notice, or both, would constitute an Amortization
Event.
"WACHOVIA" means Wachovia Bank, N.A. in its individual capacity and its
successors.
"YIELD" means for each Interest Period relating to a Receivable
Interest funded through a Liquidity Funding, an amount equal to the product of
the applicable Yield Rate for such Receivable Interest multiplied by the
Invested Amount of such Receivable Interest for each day elapsed during such
Interest Period, annualized on a 360 day basis.
"YIELD RATE" means, with respect to each Receivable Interest funded
through a Liquidity Funding, the LIBO Rate, the Alternate Base Rate or the
Default Rate, as applicable.
"YIELD RESERVE" means, for any Calculation Period, the product
(expressed as a percentage) of (i) 1.5 times (ii) the Alternate Base Rate as of
the immediately preceding Cut-Off Date times (iii) a fraction the numerator of
which is the highest Days Sales Outstanding for the most recent 12 Calculation
Periods and the denominator of which is 360.
I-22
ALL ACCOUNTING TERMS NOT SPECIFICALLY DEFINED HEREIN SHALL BE CONSTRUED
IN ACCORDANCE WITH GAAP. ALL TERMS USED IN ARTICLE 9 OF THE UCC IN THE STATE OF
NEW YORK, AND NOT SPECIFICALLY DEFINED HEREIN, ARE USED HEREIN AS DEFINED IN
SUCH ARTICLE 9.
I-23
EXHIBIT II
FORM OF PURCHASE NOTICE
---
TOWER AUTOMOTIVE RECEIVABLES COMPANY, INC.
PURCHASE NOTICE
DATED ______________, 20__
FOR PURCHASE ON ________________, 20__
Wachovia Bank, N.A., as Agent
000 Xxxxxxxxx Xxxxxx, X.X., XX-00000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxx X. Xxxxxx, Fax No. (000) 000-0000
Ladies and Gentlemen:
Reference is made to the Receivables Purchase Agreement dated as of
June 19, 2001 (as amended, supplemented or otherwise modified from time to time,
the "RECEIVABLES PURCHASE AGREEMENT") among Tower Automotive Receivables
Company, Inc. (the "SELLER"), X. X. Tower Corporation, as initial Servicer, Blue
Ridge Asset Funding Corporation, and Wachovia Bank N.A., as Agent. Capitalized
terms defined in the Receivables Purchase Agreement are used herein with the
same meanings.
1. The [Servicer, on behalf of the] Seller hereby certifies, represents
and warrants to the Agent and Blue Ridge that on and as of the Purchase Date (as
hereinafter defined):
(a) all applicable conditions precedent set forth in Article VI of the
Receivables Purchase Agreement have been satisfied;
(b) each of its representations and warranties contained in Section 5.1
of the Receivables Purchase Agreement will be true and correct, in all
material respects, as if made on and as of the Purchase Date;
(c) no event will have occurred and is continuing, or would result from
the requested Purchase, that constitutes an Amortization Event or Unmatured
Amortization Event;
(d) the Facility Termination Date has not occurred; and
(e) after giving effect to the Purchase requested below, the Aggregate
Invested Amount will not exceed the Purchase Limit and the aggregate
Receivable Interests will not exceed 100%.
II-1
2. The [Servicer, on behalf of the] Seller hereby requests that Blue
Ridge make a Purchase on ___________, 20__ (the "PURCHASE DATE") as follows:
(a) Purchase Price: $_____________
(b) If the Purchase is funded with a Liquidity Funding, [Servicer on
behalf of the] Seller requests that the Invested Amount (which will
initially accrue Yield at the Alternate Base Rate) (i) begin to accrue
Yield at a LIBO Rate for a Interest Period of _____ months on the third
Business Day after the Purchase Date or (ii) continue to accrue Yield at
the Alternate Base Rate).
3. Please disburse the proceeds of the Purchase as follows:
[Apply $________ to payment of Aggregate Unpaids due on the Purchase
Date]. [Wire transfer $________ to account no. ________ at ___________
Bank, in [city, state], ABA No. __________, Reference: ____________].
IN WITNESS WHEREOF, the [Servicer, on behalf of the] Seller has caused
this Purchase Request to be executed and delivered as of this ____ day of
___________, _____.
[_______________________, as Servicer,
on behalf of:] ____________., as Seller
By:
------------------------------------
Name:
Title:
II-2
EXHIBIT III
PLACES OF BUSINESS OF THE SELLER PARTIES;
LOCATIONS OF RECORDS;
FEDERAL EMPLOYER IDENTIFICATION NUMBER(S)
X. X. TOWER CORPORATION
Place of Business:
-----------------
0000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
Location of Records:
-------------------
0000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
Federal Employer Identification Number:
--------------------------------------
00-0000000
TOWER AUTOMOTIVE RECEIVABLES COMPANY, INC.
Place of Business:
-----------------
0000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
Location of Records:
-------------------
0000 Xxxxxxx Xxxx XX
Xxxxx Xxxxxx, XX 00000
Federal Employer Identification Number:
--------------------------------------
00-0000000
III-1
EXHIBIT IV
NAMES OF COLLECTION BANKS; LOCK-BOXES & COLLECTION ACCOUNTS
------------------------------------------------------------------------------------
LOCK-BOX RELATED COLLECTION ACCOUNT
------------------------------------------------------------------------------------
Name of Current Account Holder:
Department 77816 Tower Automotive, Inc.
Tower Automotive Account Number: 881813
P.O. Box 77000 Bank One, N.A., a national banking association
Xxxxxxx Xxxxxxxx 00000-0000 ABA Number: 000000000
Contact Person: Xxxxxxxxx X. Xxxxxx,
Treasury Management
Contact's Tel: (000) 000-0000
Contact's Fax: (000) 000-0000
------------------------------------------------------------------------------------
IV-1
EXHIBIT V
FORM OF COMPLIANCE CERTIFICATE
To: Wachovia Bank, N.A., as Agent
This Compliance Certificate is furnished pursuant to that certain
Receivables Purchase Agreement dated as of June 19, 2001 among Tower Automotive
Receivables Company, Inc. (the "SELLER"), X. X. Tower Corporation (the
"SERVICER"), Blue Ridge Asset Funding Corporation and Wachovia Bank, N.A., as
agent (the "AGREEMENT").
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected _________________ of Seller.
2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of Seller and its Subsidiaries during the accounting period
covered by the attached financial statements.
3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
an Amortization Event or Unmatured Amortization Event, as each such term is
defined under the Agreement, during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate[, except as set forth in paragraph 5 BELOW].
4. Schedule I attached hereto sets forth financial data and
computations evidencing the compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.
[5. Described below are the exceptions, if any, to paragraph 3 by
listing, in detail, the nature of the condition or event, the period during
which it has existed and the action which Seller has taken, is taking, or
proposes to take with respect to each such condition or event:
____________________]
V-1
The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered as of ______________, 20__.
By:
--------------------
Name:
Title:
V-2
SCHEDULE I TO COMPLIANCE CERTIFICATE
A. Schedule of Compliance as of __________, ____ with Section ___ of
the Agreement. Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the Agreement.
This schedule relates to the month ended: _______________
V-3
EXHIBIT VI
FORM OF COLLECTION ACCOUNT AGREEMENT
June ____, 200_
Bank One, NA and
Banc One National Processing Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
Attention: Xxxxxxxxx Xxxxxx
Treasury Management
Re: Tower Automotive, Inc., on behalf of Tower Automotive Products
Company, Inc./Tower Automotive Receivables Company, Inc.
Ladies and Gentlemen:
Reference is hereby made to the postal box identified on Schedule I
hereto in (the "Lock-Box") of which one or more of you has exclusive control for
the purpose of receiving mail and processing payments therefrom pursuant to your
agreement with Tower Automotive, Inc., a Delaware corporation ("Tower") on
behalf of Tower Automotive Products Company, Inc., a Delaware corporation (the
"Originator"), pursuant to a lock-box service agreement with Tower on behalf of
the Originator (the "Service Agreement"). You hereby confirm your agreement to
perform the services described therein. Among the services you have agreed to
perform therein, is to endorse all checks and other evidences of payment, and
credit such payments to Tower's checking accounts with you as identified on
Schedule I hereto (the "Lock-Box Account"). We understand that Bank One, NA (the
"Collection Bank") and Banc One National Processing Corporation ("BONPC") work
together to provide services with respect to the Lock-Box and Lock-Box Account.
All references herein to "you" and "your" shall mean the Collection Bank and
BONPC, as applicable.
Tower hereby informs you that (i) pursuant to that certain Receivables
Sale Agreement, dated as of June 19, 2001 among the Originator and certain of
its affiliates (collectively, the "Originators"), as xxxxxxx, X. X. Tower
Corporation, as Originator Agent for the Originators, and Tower Automotive
Receivables Company, Inc., a Michigan corporation ("SPV"), as purchaser, Tower,
on behalf of the Originator, has transferred to SPV all of the Originator's
right, title and interest in and to the items from time to time deposited into
the Lock-Box and the Lock-Box Account, and (ii) pursuant to that certain
Receivables Purchase Agreement, dated as of June 19, 2001 among SPV, as seller,
X. X. Tower Corporation, as initial servicer, Blue Ridge Asset Funding
Corporation and Wachovia Bank, N.A., individually and as
VI-1
agent (in such latter capacity, the "Agent"), SPV has granted to the Agent a
security interest in all of its right, title and interest in and to the items
from time to time deposited in the Lock-Box and the Lock-Box Account.
Each of Tower, the Originator and SPV hereby irrevocably instructs you,
and you hereby agree, that upon receiving notice from the Agent in the form
attached hereto as Annex A (the "Amortization Notice"): (i) the name of the
Lock-Box Account will be changed to "Wachovia Bank, N.A., as Agent" (or any
designee of the Agent) and the Agent will have exclusive ownership of and access
to the Lock-Box and the Lock-Box Account, and none of Tower the Originator, SPV,
nor any of their respective affiliates will have any control of the Lock-Box or
the Lock-Box Account or any access thereto, (ii) you will either continue to
send the funds from the Lock-Box to the Lock-Box Account, or will redirect the
funds as the Agent may otherwise request, (iii) you will transfer available
monies on deposit in the Lock-Box Account, at any time, to the following
account:
Bank Name: Wachovia Bank, N.A.
Location: Winston-Salem, SC
ABA Routing No.: ABA # 000000000
Credit Account No.: For credit to Blue Ridge Asset Funding
Account #8735-098787
Reference: Blue Ridge/Tower Automotive Receivables
Company, Inc.
Attention: Xxxx Xxxxxx, tel. (000) 000-0000
or as otherwise directed by the Agent, (iv) all services to be performed by you
under the Service Agreement will be performed on behalf of the Agent, and (v)
copies of all correspondence or other mail which you have agreed to send to
Tower, the Originator or SPV will be sent to the Agent at the following address:
Wachovia Bank, N.A., as Agent
000 Xxxxxxxxx Xxxxxx, X. E.
Mail Stop GA-31261
Xxxxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxxxxx,
Asset-Backed Finance
FAX: (000) 000-0000
Moreover, upon such notice, the Agent will have all rights and remedies given to
the Originator (and the SPV, as the Originator's assignee) under the Service
Agreement. The Originator agrees, however, to continue to pay all fees and other
assessments due thereunder at any time.
Notwithstanding the foregoing, in the event that you receive notice
from the Agent in the form attached hereto as Annex B (the "Facility Termination
Notice") after receipt of the Amortization Notice: (i) the name of the Lock-Box
Account will revert from "Wachovia Bank, N.A., as Agent" (or any designee of the
Agent) to "Tower Automotive, Inc." and Tower will once again have exclusive
ownership of and access to the Lock-Box and the Lock-Box Account, and neither of
Agent nor any designee of Agent will thereafter have any control of the
VI-2
Lock-Box or the Lock-Box Account or any access thereto, (ii) you will either
continue to send available funds from the Lock-Box to the Lock-Box Account, or
will redirect such funds as Tower may otherwise request, (iii) all services to
be performed by you under the Service Agreement will be performed on behalf of
Tower for the benefit of the Originator, and (iv) you will immediately cease
sending copies of all correspondence or other mail which you had previously
agreed to send to the Agent upon receipt of the Amortization Notice.
Prior to the Effective Time (as defined below) and after the Reverted
Effective Time (as defined below) you shall honor all withdrawal, payment,
transfer or other instructions (collectively, "instructions") received from
Tower (but not those from the Agent or its designee) concerning the Lock-Box and
the Lock-Box Account. On and after the Effective Time but prior to the Reverted
Effective Time, you shall honor all instructions received from the Agent (but
not those from Tower) concerning the Lock-Box and the Lock-Box Account.
For the purposes hereof, the "Effective Time" shall be the opening of
business on the business day next succeeding the business day on which a notice
in substantially the form of the Amortization Notice is actually received by
your individual employee to whom the notice is required hereunder to be
addressed (provided that if any such notice is so received after 12:00 P.M.
(Detroit, Michigan) on any business day, the "Effective Time" shall be the
opening of business on the business day next succeeding the business day on
which such receipt occurs); and a "business day" is any day other than a
Saturday, Sunday or any other day on which you are authorized or required by law
to be closed. For the purposes hereof, the "Reverted Effective Time" shall be
the opening of business on the business day next succeeding the business day on
which a notice in substantially the form of the Facility Termination Notice is
actually received by your individual employee to whom the notice is required
hereunder to be addressed (provided that if any such notice is so received after
12:00 P.M. (Detroit, Michigan) on any business day, the "Reverted Effective
Time" shall be the opening of business on the business day next succeeding the
business day on which such receipt occurs); and a "business day" is any day
other than a Saturday, Sunday or any other day on which you are authorized or
required by law to be closed.
Notwithstanding the foregoing (i) all transactions relating to the
Lock-Box and the Lock-Box Account or any items therein duly commenced by you or
any affiliate prior to the Effective Time and so consummated or processed
thereafter shall be deemed not to constitute a violation of this Agreement, (ii)
you and/or any affiliate may (at its discretion and without any obligation to do
so) commence honoring solely the Agent's instructions concerning the Lock-Box
and the Lock-Box Account at any time or from time to time after it becomes aware
that the Agent has sent to it a signed notice in substantially the form of the
Amortization Notice but prior to the Effective Time therefor (including without
limitation reversing or redirecting any transaction referred to in clause (i)
above) with no liability whatsoever to Tower, the Originator, SPV or any other
party for doing so and (iii) you and/or any affiliate may (at its discretion and
without any obligation to do so) commence honoring solely Tower's instructions
concerning the Lock-Box and the Lock-Box Account at any time or from time to
time after it becomes aware that the Agent has sent to it a signed notice in
substantially the form of the Facility Termination Notice but prior to the
Reverted Effective Time therefor (including without limitation reversing or
redirecting any transaction referred to in clause (i) above) with no liability
whatsoever to the Agent or any other party for doing so.
VI-3
You shall not be deemed to have any knowledge (imputed or otherwise)
of: (a) any of the terms or conditions of any financing arrangement or any
document referred to therein among Tower, the Originator, SPV, and the Agent, or
any breach thereof, or (b) any occurrence or existence of a default. You have no
obligation to inform any person of such breach or to take any action in
connection with any of the foregoing, except such actions regarding the Lock-Box
and Lock-Box Account as are specified in this Letter Agreement. You are not
responsible for the enforceability or validity of the security interest in the
Lock-Box or the Lock-Box Account.
You hereby acknowledge that monies deposited in the Lock-Box Account or
any other account established with you by the Agent for the purpose of receiving
funds from the Lock-Box are subject to the liens of the Agent, and will not be
subject to deduction, set-off, banker's lien or any other right you or any other
party may have against Tower, the Originator or SPV, except that you may debit
the Lock-Box Account for (a) any items, including, without limitation, any
automated clearinghouse transactions, which are returned for any reason and any
adjustments; and (b) any amount then due from Tower, the Originator, SPV or the
Agent to you under this Letter Agreement or related to such items, the Lock-Box
Account or any items deposited therein that are otherwise not collected and for
all charges, fees, commissions and expenses incurred by you in providing
services hereunder, all in accordance with your customary practices for the
charge back of returned items and expenses. Subject to the terms of this Letter
Agreement, you agree that the security interest is superior to any right of
set-off, security interest or other lien which you might otherwise have in the
items, the Lock-box or the Lock-box Account.
You will be liable only for direct damages in the event you fail to
exercise ordinary care. You shall be deemed to have exercised ordinary care if
your action or failure to act is in conformity with general banking usages or is
otherwise a commercially reasonable practice of the banking industry. You shall
not be liable for any special, indirect or consequential damages, even if you
have been advised of the possibility of these damages.
Each of Tower, the Originator, the SPV and, from and after delivery of
an Amortization Notice, the Agent, severally and jointly agrees to indemnify you
for, and hold you harmless from, all claims, damages, losses, liabilities and
expenses, including legal fees and expenses, resulting from or with respect to
this Letter Agreement and the administration and maintenance of the Lock-Box
Account and the services provided hereunder, including, without limitation: (a)
any action taken, or not taken, by you in regard thereto in accordance with the
terms of this Letter Agreement, (b) the breach of any representation or warranty
made by Tower, the Originator or SPV pursuant to this Letter Agreement, (c) any
item, including, without limitation, any automated clearinghouse transaction,
which is returned for any reason, and any adjustments, and (d) any failure of
Tower, the Originator or SPV to pay any invoice or charge to you for services in
respect to this Letter Agreement and the Lock-Box Account or any amount owing to
you from Tower, the Originator or SPV with respect thereto or to the service
provided hereunder.
None of Tower, the Originator, SPV, the Agent or you may assign or
transfer any of its rights or obligations under the this Letter Agreement,
except you may assign or transfer its rights and obligations to any subsidiary
of BANK ONE CORPORATION or any successor
VI-4
thereto. The Letter Agreement shall bind the respective successors and assigns
of the parties and shall inure to the benefit of their respective successors and
assigns.
This Letter Agreement and the rights and obligations of the parties
hereunder will be governed by and construed and interpreted in accordance with
internal laws (and not the law of conflicts) of the State of Illinois and
applicable federal laws. This Letter Agreement may be executed in any number of
counterparts and all of such counterparts taken together will be deemed to
constitute one and the same instrument.
This Letter Agreement and the services provided under the Service
Agreement may be terminated by the Agent or you at any time by giving each of
the other parties hereto ninety (90) calendar days' prior written notice of such
termination.
This Letter Agreement contains the entire agreement between the
parties, and may not be altered, modified, terminated or amended in any respect,
nor may any right, power or privilege of any party hereunder be waived or
released or discharged, except upon execution by all parties hereto of a written
instrument so providing. In the event that any provision in this Letter
Agreement is in conflict with, or inconsistent with, any provision of any of the
Service Agreement, this Letter Agreement will exclusively govern and control.
Each party agrees to take all actions reasonably requested by any other party to
carry out the purposes of this Letter Agreement or to preserve and protect the
rights of each party hereunder.
Any notices given pursuant to this Letter Agreement shall be given by
any commercially reasonable means and all notices shall be effective when
received. Each written notice shall be addressed to the relevant address
appearing below or at another address specified in a written notice by one party
to the other.
If to Tower:
Tower Automotive, Inc.
0000 Xxxxxxx Xxxx X.X.
Xxxxx Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx/Xxxxx X. Xxxxxx
Fax: 000-000-0000
If to Originator:
Tower Automotive Products Company, Inc.
0000 Xxxxxxx Xxxx X.X.
Xxxxx Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx/Xxxxx X. Xxxxxx
Fax: 000-000-0000
VI-5
If to SPV:
Tower Automotive Receivables Company, Inc.
0000 Xxxxxxx Xxxx X.X.
Xxxxx Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx/Xxxxx Xxxxxx
Fax: 000-000-0000
If to Bank One:
Bank One, Michigan
000 Xxxxxxxx Xxx.
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx, Treasury Mgmt.
MI1-8033
Fax: 000-000-0000
If to Agent:
Wachovia Bank, N.A., as Agent
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx XX-00000
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxx
Fax: 000-000-0000
Please indicate your agreement to the terms of this Letter Agreement by
signing in the space provided below. This Letter Agreement will become effective
immediately upon execution of a counterpart of this Letter Agreement by all
parties hereto.
Very truly yours,
TOWER AUTOMOTIVE, INC.
By:
-----------------------------
Name:
Title:
VI-6
TOWER AUTOMOTIVE PRODUCTS COMPANY, INC.
By:
---------------------------------------
Name:
Title:
TOWER AUTOMOTIVE RECEIVABLES COMPANY, INC.
By:
---------------------------------------
Name:
Title:
VI-7
ACKNOWLEDGED AND AGREED TO
AS OF THE DATE FIRST ABOVE WRITTEN:
BANK ONE, NA
By:
-----------------------------------
Name:
Title:
BANC ONE NATIONAL PROCESSING CORPORATION
By:
-----------------------------------
Name:
Title:
WACHOVIA BANK, N.A., as Agent
By:
-----------------------------------
Name:
Title:
VI-8
ANNEX A
FORM OF COLLECTION NOTICE
[On letterhead of the Agent]
[Date]
Bank One, NA and
Banc One National Processing Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
Attention: Xxxxxxxxx Xxxxxx
Treasury Management
Re: Tower Automotive Receivables Company, Inc.
Ladies and Gentlemen:
We hereby notify you that we are exercising our rights pursuant to that
certain letter agreement dated June 19, 2001 (the "Letter Agreement") among
Tower Automotive, Inc. ("Tower"), Tower Automotive Products Company, Inc., Tower
Automotive Receivables Company, Inc., you and us, to have the name of, and to
have exclusive ownership and control of, the bank account identified in the
Letter Agreement (the "Lock-Box Account") maintained with you, transferred to
us. We hereby certify that an Amortization Event, as such term is defined in
that certain Receivables Purchase Agreement, dated as of June 19, 2001 among
Tower Automotive Receivables Company, Inc., as seller, X. X. Tower Corporation,
as initial servicer, Blue Ridge Asset Funding Corporation and Wachovia Bank,
N.A., individually and as agent has occurred, the occurrence of which entitles
us to deliver this Amortization Notice to you.
Until further notice the Lock-Box Account will henceforth be a
zero-balance account, and available funds deposited in the Lock-Box Account
should be sent at the end of each day to:
Bank Name: Wachovia Bank, N.A.
Location: Winston-Salem, SC
ABA Routing No.: ABA # 000000000
Credit Account No.: For credit to Blue Ridge Asset Funding
Account #8735-098787
VI-9
Reference: Blue Ridge/Tower Automotive Receivables
Company, Inc.
Attention: Xxxx Xxxxxx, tel. (000) 000-0000
or as otherwise directed by the Agent. You have further agreed to perform all
other services you are performing under the "Service Agreement" (as defined in
the Letter Agreement) on our behalf.
We appreciate your cooperation in this matter.
Very truly yours,
WACHOVIA BANK, N.A., as Agent
By:
------------------------------------
Title:
VI-10
ANNEX B
FORM OF FACILITY TERMINATION NOTICE
[On letterhead of the Agent]
[Date]
Bank One, NA and
Banc One National Processing Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Fax No.: (000) 000-0000
Attn: Xxxxxxxxx Xxxxxx, Treasury Mgmt.
MI1-8033
Re: Tower Automotive Receivables Company, Inc.
Ladies and Gentlemen:
We hereby notify you, pursuant to that certain letter agreement dated
June 19, 2001 (the "Letter Agreement") among Tower Automotive, Inc. ("Tower"),
Tower Automotive Products Company, Inc., Tower Automotive Receivables Company,
Inc. ("SPV"), you and us, that all payment obligations consisting of Aggregate
Unpaids (as those terms are defined in that certain Receivables Purchase
Agreement, dated as of June 19, 2001 (the "Receivables Purchase Agreement")
among SPV, as seller, X. X. Tower Corporation, as initial servicer, Blue Ridge
Asset Funding Corporation and Wachovia Bank, N.A., individually and as agent)
have been discharged and that the Receivables Purchase Agreement has terminated
in accordance with its terms.
We hereby request that the name of, and the exclusive ownership and
control of, the bank account identified in the Letter Agreement (the "Lock-Box
Account") maintained with you, be transferred from us to Tower and into the name
of "Tower Automotive, Inc." and that all services to be performed by you under
the "Service Agreement" (as defined in the Letter Agreement) will henceforth be
performed on behalf of Tower.
VI-11
We appreciate your cooperation in this matter.
Very truly yours,
WACHOVIA BANK, N.A., as Agent
By:
-------------------------------
Title:
VI-12
SCHEDULE I
LOCK-BOXES AND LOCK-BOX ACCOUNTS
Name of Account Holder Lock-Box P.O. Address LockBox Account Number
---------------------- --------------------- ----------------------
Tower Automotive, Inc. Department 77816 DDA # 881813
Tower Automotive
X.X. Xxx 00000
Xxxxxxx, XX 00000-0000
VI-13
EXHIBIT VII
[INTENTIONALLY DELETED]
VII-1
EXHIBIT VIII
FORM OF MONTHLY REPORT
Tower Automotive Receivables Company Inc. Monthly Report
For the Month Ended:
($)
I. Portfolio Information
1. Beginning of Month Balance: (Total A/R Outstanding)
2. Gross Sales (Domestic & Foreign):
3. Deduct:
a. Total Collections:
b. Dilution
c. Write Offs
Add:
d. Recoveries
e. Miscellaneous Adjustments
4.
a. Calculated Ending A/R Balance [(1) + (2) - (3 a,b,c)+(3d,e)]:
b. Reported Ending A/R Balance
c. Difference (If any)
d. Total Receivables from Unapproved Business Units
5. Deduct:
a. Delinquent Receivables
b. Defaulted Receivables
c. Excess Canadian Receivables
d. Foreign Receivables:
VIII-1
e. Intercompany
f. Tooling
g. Contra Accounts
h. Total Bankrupt
i. Other Ineligibles (ie Cost Recoveries)
j. Total Ineligibles
6. Eligible Receivables [(4 b) - (5.c.)]:
7. Deduct: Excess Concentration:
8. Net Pool Balance [(6) - (7)]:
9. AGING CURRENT ONE MONTH TWO MONTHS THREE MONTHS
SCHEDULE: MONTH % PRIOR PRIOR PRIOR
---------------------------------------------------------------------------------------------------
a. 1-30 Days Past Invoice Date
b. 31-60 Days Past Invoice Date
c. 61-90 Days Past Invoice Date
d. 91+ Days Past Invoice Date
g. Total:
Tower Automotive Receivables Company Inc. Monthly Report
For the Month Ended:
($)
II. Calculations Reflecting Current Activity
10. Aggregate Invested Amount
11. Required Reserve %
12. Required Reserve [(8) x (11)]:
13. Net Pool Balance
15. Base Funded Amount Available
16. Additional Ford Availability
17. Total Funding Availability
VIII-2
III. Compliance
18. Asset Interest [(10) + (12) / (8) + (16)] < 100% :
19. 3M Avg. Delinquency Ratio
20. 3M Avg. Loss Reserve Ratio
21. 3M Avg. Dilution Ratio
22. Facility Limit [(10)<= $60,000,000]
23. Net Worth of Tower Receivables Company, Inc.
Required Capital Amount
24. Maximum Exposure Amount
Tower Automotive Receivables Company Inc. Monthly Report
For the Month Ended:
($)
IV. Excess Concentration:
(Calculation)
Eligible Receivables
Allowable Percentage Max. Allowable Balance) Credit Rating
2.5% NR/NR
3.0% A3/P3
6.0% A2/P2
8.0% A1/P1
10.0% A1+/P1
22.0% Ford
18.0% DaimlerChrysler
VIII-3
Largest Short-Term Allowable Total Allowable Excess
Obligors Debt Rating Percentage Receivables Receivables Concentrations
--------------------------------------------------------------------------------
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Total
The undersigned hereby represents and warrants that the foregoing is a true and
accurate accounting with respect to outstanding receivables as of ____________
accordance with the Receivables Purchase Agreement dated June 11, 2001 and that
all representations and warranties related to such Agreement are restated and
reaffirmed.
Signed: Date:
---------------------------------- ------------------------
Title:
-----------------------------------
VIII-4
EXHIBIT IX
[INTENTIONALLY DELETED]
IX-1
EXHIBIT X
FORM OF PERFORMANCE UNDERTAKING
THIS PERFORMANCE UNDERTAKING (this "UNDERTAKING"), dated as of June 19,
2001, is executed by X. X. Tower Corporation, a Michigan corporation (the
"PERFORMANCE GUARANTOR") in favor of Tower Automotive Receivables Company, Inc.,
a Michigan corporation (together with its successors and assigns, "RECIPIENT").
RECITALS
1. Tower Automotive Products Company, Inc., Tower Automotive Technology
Products, Inc., Trylon Corporation, Tower Automotive Bardstown, Inc., Tower
Automotive Michigan Limited Partnership and Tower Automotive Tool, LLC
(collectively, the "ORIGINATORS"), X. X. Tower Corporation, as Originator Agent
and Recipient have entered into a Receivables Sale Agreement, dated as of June
19, 2001 (as amended, restated or otherwise modified from time to time, the
"SALE AGREEMENT"), pursuant to which Originators, subject to the terms and
conditions contained therein, are selling and/or contributing their respective
right, title and interest in their accounts receivable to Recipient.
2. Performance Guarantor owns directly or indirectly one hundred
percent (100%) of the capital stock of each of the Originators and Recipient,
and each of the Originators, and accordingly, Performance Guarantor, is expected
to receive substantial direct and indirect benefits from their sale or
contribution of receivables to Recipient pursuant to the Sale Agreement (which
benefits are hereby acknowledged).
3. As an inducement for Recipient to acquire Originators' accounts
receivable pursuant to the Sale Agreement, Performance Guarantor has agreed to
guaranty the due and punctual performance by Originators of their obligations
under the Sale Agreement.
4. Performance Guarantor wishes to guaranty the due and punctual
performance by Originators of their obligations to Recipient under or in respect
of the Sale Agreement, as provided herein.
AGREEMENT
NOW, THEREFORE, Performance Guarantor hereby agrees as
follows:
Section 1. Definitions. Capitalized terms used herein and not defined
herein shall the respective meanings assigned thereto in the Sale Agreement or
the Receivables Purchase Agreement (as hereinafter defined). In addition:
"GUARANTEED OBLIGATIONS" means, collectively: all covenants,
agreements, terms, conditions and indemnities to be performed and observed by
any Originator under and pursuant to the Sale Agreement and each other document
executed and delivered by any Originator pursuant to the Sale Agreement,
including, without limitation, the due and punctual payment of all sums which
are or may become due and owing by any Originator under the Sale Agreement,
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whether for fees, expenses (including counsel fees), indemnified amounts or
otherwise, whether upon any termination or for any other reason.
Section 2. Guaranty of Performance of Guaranteed Obligations.
Performance Guarantor hereby guarantees to Recipient, the full and punctual
payment and performance by each Originator of its respective Guaranteed
Obligations. This Undertaking is an absolute, unconditional and continuing
guaranty of the full and punctual performance of all Guaranteed Obligations of
each Originator under the Sale Agreement and each other document executed and
delivered by any Originator pursuant to the Sale Agreement and is in no way
conditioned upon any requirement that Recipient first attempt to collect any
amounts owing by any Originator to Recipient, the Agent or Blue Ridge from any
other Person or resort to any collateral security, any balance of any deposit
account or credit on the books of Recipient, the Agent or Blue Ridge in favor of
any Originator or any other Person or other means of obtaining payment. Should
any Originator default in the payment or performance of any of its Guaranteed
Obligations and such default shall remain uncured after the passage of all
applicable grace periods provided for in the Sale Agreement, Recipient (or its
assigns) may cause the immediate performance by Performance Guarantor of the
Guaranteed Obligations and cause any payment Guaranteed Obligations to become
forthwith due and payable to Recipient (or its assigns), without demand or
notice of any nature (to Performance Guarantor or other than as expressly
provided herein), all of which are hereby expressly waived by Performance
Guarantor. Notwithstanding the foregoing, this Undertaking is not a guarantee of
the collection of any of the Receivables and Performance Guarantor shall not be
responsible for any Guaranteed Obligations to the extent the failure to perform
such Guaranteed Obligations by any Originator results from Receivables being
uncollectible on account of the insolvency, bankruptcy or lack of
creditworthiness of the related Obligor; PROVIDED THAT nothing herein shall
relieve any Originator from performing in full its Guaranteed Obligations under
the Agreements or Performance Guarantor of its undertaking hereunder with
respect to the full performance of such duties.
Section 3. Performance Guarantor's Further Agreements to Pay.
Performance Guarantor further agrees, as the principal obligor and not as a
guarantor only, to pay to Recipient (and its assigns), forthwith upon demand in
funds immediately available to Recipient, all reasonable costs and expenses
(including court costs and reasonable legal expenses) incurred or expended by
Recipient in connection with the Guaranteed Obligations, this Undertaking and
the enforcement thereof, together with interest on amounts recoverable under
this Undertaking from the time when such amounts become due until payment, at a
rate of interest (computed for the actual number of days elapsed based on a 360
day year) equal to the Prime Rate plus 2% per annum, such rate of interest
changing when and as the Prime Rate changes.
Section 4. Waivers by Performance Guarantor. Performance Guarantor
waives notice of acceptance of this Undertaking, notice of any action taken or
omitted by Recipient (or its assigns) in reliance on this Undertaking, and any
requirement that Recipient (or its assigns) be diligent or prompt in making
demands under this Undertaking, giving notice of any Termination Event,
Amortization Event, other default or omission by any Originator or asserting any
other rights of Recipient under this Undertaking. Performance Guarantor warrants
that it has adequate means to obtain from each Originator, on a continuing
basis, information concerning the financial condition of such Originator, and
that it is not relying on Recipient to provide such information, now or in the
future. Performance Guarantor also irrevocably waives all defenses
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(i) that at any time may be available in respect of the Guaranteed Obligations
by virtue of any statute of limitations, valuation, stay, moratorium law or
other similar law now or hereafter in effect or (ii) that arise under the law of
suretyship, including impairment of collateral. Recipient (and its assigns)
shall be at liberty, without giving notice to or obtaining the assent of
Performance Guarantor and without relieving Performance Guarantor of any
liability under this Undertaking, to deal with each Originator and with each
other party who now is or after the date hereof becomes liable in any manner for
any of the Guaranteed Obligations, in such manner as Recipient in its sole
discretion deems fit, and to this end Performance Guarantor agrees that the
validity and enforceability of this Undertaking, including without limitation,
the provisions of Section 7 hereof, shall not be impaired or affected by any of
the following: (a) any extension, modification or renewal of, or indulgence with
respect to, or substitutions for, the Guaranteed Obligations or any part thereof
or any agreement relating thereto at any time; (b) any failure or omission to
enforce any right, power or remedy with respect to the Guaranteed Obligations or
any part thereof or any agreement relating thereto, or any collateral securing
the Guaranteed Obligations or any part thereof; (c) any waiver of any right,
power or remedy or of any Termination Event, Amortization Event, or default with
respect to the Guaranteed Obligations or any part thereof or any agreement
relating thereto; (d) any release, surrender, compromise, settlement, waiver,
subordination or modification, with or without consideration, of any other
obligation of any person or entity with respect to the Guaranteed Obligations or
any part thereof; (e) the enforceability or validity of the Guaranteed
Obligations or any part thereof or the genuineness, enforceability or validity
of any agreement relating thereto or with respect to the Guaranteed Obligations
or any part thereof; (f) the application of payments received from any source to
the payment of any payment obligations of any Originator or any part thereof or
amounts which are not covered by this Undertaking even though Recipient (or its
assigns) might lawfully have elected to apply such payments to any part or all
of the payment obligations of such Originator or to amounts which are not
covered by this Undertaking; (g) the existence of any claim, setoff or other
rights which Performance Guarantor may have at any time against any Originator
in connection herewith or any unrelated transaction; (h) any assignment or
transfer of the Guaranteed Obligations or any part thereof; or (i) any failure
on the part of any Originator to perform or comply with any term of the
Agreements or any other document executed in connection therewith or delivered
thereunder, all whether or not Performance Guarantor shall have had notice or
knowledge of any act or omission referred to in the foregoing clauses (a)
through (i) of this Section 4.
Section 5. Unenforceability of Guaranteed Obligations Against
Originators. Notwithstanding (a) any change of ownership of any Originator or
the insolvency, bankruptcy or any other change in the legal status of any
Originator; (b) the change in or the imposition of any law, decree, regulation
or other governmental act which does or might impair, delay or in any way affect
the validity, enforceability or the payment when due of the Guaranteed
Obligations; (c) the failure of any Originator or Performance Guarantor to
maintain in full force, validity or effect or to obtain or renew when required
all governmental and other approvals, licenses or consents required in
connection with the Guaranteed Obligations or this Undertaking, or to take any
other action required in connection with the performance of all obligations
pursuant to the Guaranteed Obligations or this Undertaking; or (d) if any of the
moneys included in the Guaranteed Obligations have become irrecoverable from any
Originator for any other reason other than final payment in full of the payment
obligations in accordance with their terms, this Undertaking shall nevertheless
be binding on Performance Guarantor. This Undertaking shall be
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in addition to any other guaranty or other security for the Guaranteed
Obligations, and it shall not be rendered unenforceable by the invalidity of any
such other guaranty or security. In the event that acceleration of the time for
payment of any of the Guaranteed Obligations is stayed upon the insolvency,
bankruptcy or reorganization of any Originator or for any other reason with
respect to any Originator, all such amounts then due and owing with respect to
the Guaranteed Obligations under the terms of the Agreements, or any other
agreement evidencing, securing or otherwise executed in connection with the
Guaranteed Obligations, shall be immediately due and payable by Performance
Guarantor.
Section 6. Representations and Warranties. Performance Guarantor hereby
represents and warrants to Recipient that:
(a) Existence and Standing. Performance Guarantor is a corporation duly
organized, validly existing and in good standing under the laws of its state of
incorporation. Performance Guarantor is duly qualified to do business and is in
good standing as a foreign corporation, and has and holds all corporate power
and all governmental licenses, authorizations, consents and approvals required
to carry on its business in each jurisdiction in which its business is conducted
except where the failure to so qualify or so hold could not reasonably be
expected to have a Material Adverse Effect.
(b) Authorization, Execution and Delivery; Binding Effect. The
execution and delivery by Performance Guarantor of this Undertaking, and the
performance of its obligations hereunder, are within its corporate powers and
authority and have been duly authorized by all necessary corporate action on its
part. This Undertaking has been duly executed and delivered by Performance
Guarantor. This Undertaking constitutes the legal, valid and binding obligation
of Performance Guarantor enforceable against Performance Guarantor in accordance
with its terms, except as such enforcement may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws relating to or
limiting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).
(c) No Conflict; Government Consent. The execution and delivery by
Performance Guarantor of this Undertaking, and the performance of its
obligations hereunder do not contravene or violate (i) its certificate or
articles of incorporation or by-laws, (ii) any law, rule or regulation
applicable to it, (iii) any restrictions under any agreement, contract or
instrument to which it is a party or by which it or any of its property is
bound, or (iv) any order, writ, judgment, award, injunction or decree binding on
or affecting it or its property, and do not result in the creation or imposition
of any Adverse Claim on assets of Performance Guarantor or its Subsidiaries
(except as created hereunder) except, in any case, where such contravention or
violation could not reasonably be expected to have a Material Adverse Effect.
(d) Financial Statements. The consolidated financial statements of
Performance Guarantor and its consolidated Subsidiaries dated as of December 31,
2000 heretofore delivered to Recipient have been prepared in accordance with
generally accepted accounting principles consistently applied and fairly present
in all material respects the consolidated financial condition and results of
operations of Performance Guarantor and its consolidated Subsidiaries as of such
dates and for the periods ended on such dates. As of the
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date hereof, no event has occurred since December 31, 2000 which would or could
reasonably be expected to have a Material Adverse Effect.
(e) Taxes. Performance Guarantor has filed all United States federal
tax returns and all other tax returns which are required to be filed and have
paid all taxes due pursuant to said returns or pursuant to any assessment
received by Performance Guarantor or any of its Subsidiaries, except such taxes,
if any, as are being contested in good faith and as to which adequate reserves
have been provided. The United States income tax returns of Performance
Guarantor have been audited by the Internal Revenue Service through the fiscal
year ended December 31, 1997. No federal or state tax liens have been filed and
no claims are being asserted with respect to any such taxes. The charges,
accruals and reserves on the books of Performance Guarantor in respect of any
taxes or other governmental charges are adequate.
(f) Litigation and Contingent Obligations. Except as disclosed in the
filings made by Performance Guarantor with the Securities and Exchange
Commission, there are no actions, suits or proceedings pending or, to the best
of Performance Guarantor's knowledge threatened against or affecting Performance
Guarantor or any of its properties, in or before any court, arbitrator or other
body, that could reasonably be expected to have a material adverse effect on (i)
the business, properties, condition (financial or otherwise) or results of
operations of Performance Guarantor and its Subsidiaries taken as a whole, (ii)
the ability of Performance Guarantor to perform its obligations under this
Undertaking, or (iii) the validity or enforceability of any of this Undertaking
or the rights or remedies of Recipient hereunder. Performance Guarantor does not
have any material Contingent Obligations not provided for or disclosed in the
financial statements referred to in Section 6(d).
Section 7. Subrogation; Subordination. Notwithstanding anything to the
contrary contained herein, until the Guaranteed Obligations are paid in full
Performance Guarantor: (a) will not enforce or otherwise exercise any right of
subrogation to any of the rights of Recipient, the Agent or Blue Ridge against
any Originator, (b) hereby waives all rights of subrogation (whether
contractual, under Section 509 of the United States Bankruptcy Code, at law or
in equity or otherwise) to the claims of Recipient, the Agent and Blue Ridge
against any Originator and all contractual, statutory or legal or equitable
rights of contribution, reimbursement, indemnification and similar rights and
"claims" (as that term is defined in the United States Bankruptcy Code) which
Performance Guarantor might now have or hereafter acquire against any Originator
that arise from the existence or performance of Performance Guarantor's
obligations hereunder, (c) will not claim any setoff, recoupment or counterclaim
against any Originator in respect of any liability of Performance Guarantor to
such Originator and (d) waives any benefit of and any right to participate in
any collateral security which may be held by Beneficiaries, the Agent or Blue
Ridge. The payment of any amounts due with respect to any indebtedness of any
Originator now or hereafter owed to Performance Guarantor is hereby subordinated
to the prior payment in full of all of the Guaranteed Obligations. Performance
Guarantor agrees that, after the occurrence of any default in the payment or
performance of any of the Guaranteed Obligations, Performance Guarantor will not
demand, xxx for or otherwise attempt to collect any such indebtedness of any
Originator to Performance Guarantor until all of the Guaranteed Obligations
shall have been paid and performed in full. If, notwithstanding the foregoing
sentence, Performance Guarantor shall collect, enforce or receive any amounts in
respect of such indebtedness while any obligations are still unperformed or
outstanding, such
X-5
amounts shall be collected, enforced and received by Performance Guarantor as
trustee for Recipient (and its assigns) and be paid over to Recipient (or its
assigns) on account of the Guaranteed Obligations without affecting in any
manner the liability of Performance Guarantor under the other provisions of this
Undertaking. The provisions of this Section 7 shall be supplemental to and not
in derogation of any rights and remedies of Recipient under any separate
subordination agreement which Recipient may at any time and from time to time
enter into with Performance Guarantor.
Section 8. Termination of Performance Undertaking. Performance
Guarantor's obligations hereunder shall continue in full force and effect until
all Aggregate Unpaids are finally paid and satisfied in full and the Receivables
Purchase Agreement is terminated, PROVIDED THAT this Undertaking shall continue
to be effective or shall be reinstated, as the case may be, if at any time
payment or other satisfaction of any of the Guaranteed Obligations is rescinded
or must otherwise be restored or returned upon the bankruptcy, insolvency, or
reorganization of any Originator or otherwise, as though such payment had not
been made or other satisfaction occurred, whether or not Recipient (or its
assigns) is in possession of this Undertaking. No invalidity, irregularity or
unenforceability by reason of the federal bankruptcy code or any insolvency or
other similar law, or any law or order of any government or agency thereof
purporting to reduce, amend or otherwise affect the Guaranteed Obligations shall
impair, affect, be a defense to or claim against the obligations of Performance
Guarantor under this Undertaking.
Section 9. Effect of Bankruptcy. This Performance Undertaking shall
survive the insolvency of any Originator and the commencement of any case or
proceeding by or against any Originator under the federal bankruptcy code or
other federal, state or other applicable bankruptcy, insolvency or
reorganization statutes. No automatic stay under the federal bankruptcy code
with respect to any Originator or other federal, state or other applicable
bankruptcy, insolvency or reorganization statutes to which any Originator is
subject shall postpone the obligations of Performance Guarantor under this
Undertaking.
Section 10. Setoff. Regardless of the other means of obtaining payment
of any of the Guaranteed Obligations, Recipient (and its assigns) is hereby
authorized at any time and from time to time, without notice to Performance
Guarantor (any such notice being expressly waived by Performance Guarantor) and
to the fullest extent permitted by law, to set off and apply any deposits and
other sums against the obligations of Performance Guarantor under this
Undertaking, whether or not Recipient (or any such assign) shall have made any
demand under this Undertaking and although such obligations may be contingent or
unmatured.
Section 11. Taxes. All payments to be made by Performance Guarantor
hereunder shall be made free and clear of any deduction or withholding. If
Performance Guarantor is required by law to make any deduction or withholding on
account of tax or otherwise from any such payment, the sum due from it in
respect of such payment shall be increased to the extent necessary to ensure
that, after the making of such deduction or withholding, Recipient receive a net
sum equal to the sum which they would have received had no deduction or
withholding been made.
X-6
Section 12. Further Assurances. Performance Guarantor agrees that it
will from time to time, at the request of Recipient (or its assigns), provide
information relating to the business and affairs of Performance Guarantor as
Recipient may reasonably request. Performance Guarantor also agrees to do all
such things and execute all such documents as Recipient (or its assigns) may
reasonably consider necessary or desirable to give full effect to this
Undertaking and to perfect and preserve the rights and powers of Recipient
hereunder.
Section 13. Successors and Assigns. This Performance Undertaking shall
be binding upon Performance Guarantor, its successors and permitted assigns, and
shall inure to the benefit of and be enforceable by Recipient and its successors
and assigns. Performance Guarantor may not assign or transfer any of its
obligations hereunder without the prior written consent of each of Recipient and
the Agent. Without limiting the generality of the foregoing sentence, Recipient
may assign or otherwise transfer the Agreements, any other documents executed in
connection therewith or delivered thereunder or any other agreement or note held
by them evidencing, securing or otherwise executed in connection with the
Guaranteed Obligations, or sell participations in any interest therein, to any
other entity or other person, and such other entity or other person shall
thereupon become vested, to the extent set forth in the agreement evidencing
such assignment, transfer or participation, with all the rights in respect
thereof granted to the Beneficiaries herein.
Section 14. Amendments and Waivers. No amendment or waiver of any
provision of this Undertaking nor consent to any departure by Performance
Guarantor therefrom shall be effective unless the same shall be in writing and
signed by Recipient, the Agent and Performance Guarantor. No failure on the part
of Recipient to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right.
Section 15. Notices. All notices and other communications provided for
hereunder shall be made in writing and shall be addressed as follows: if to
Performance Guarantor, at the address set forth beneath its signature hereto,
and if to Recipient, at the addresses set forth beneath its signature hereto, or
at such other addresses as each of Performance Guarantor or any Recipient may
designate in writing to the other. Each such notice or other communication shall
be effective (1) if given by telecopy, upon the receipt thereof, (2) if given by
mail, three (3) Business Days after the time such communication is deposited in
the mail with first class postage prepaid or (3) if given by any other means,
when received at the address specified in this Section 15.
Section 16. GOVERNING LAW. THIS UNDERTAKING SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW (EXCEPT IN THE CASE OF THE OTHER TRANSACTION DOCUMENTS,
TO THE EXTENT OTHERWISE EXPRESSLY STATED THEREIN) IN ANY OF THE COLLATERAL IS
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
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Section 17. CONSENT TO JURISDICTION. EACH OF PROVIDER AND RECIPIENT
HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED
STATES FEDERAL OR NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS UNDERTAKING, THE
AGREEMENTS OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION THEREWITH OR DELIVERED
THEREUNDER AND EACH OF THE PERFORMANCE GUARANTOR AND RECIPIENT HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
Section 18. Bankruptcy Petition. Performance Guarantor hereby covenants
and agrees that, prior to the date that is one year and one day after the
payment in full of all outstanding senior Indebtedness of Blue Ridge, it will
not institute against, or join any other Person in instituting against, Blue
Ridge any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceeding under the laws of the United States or
any state of the United States.
Section 19. Miscellaneous. This Undertaking constitutes the entire
agreement of Performance Guarantor with respect to the matters set forth herein.
The rights and remedies herein provided are cumulative and not exclusive of any
remedies provided by law or any other agreement, and this Undertaking shall be
in addition to any other guaranty of or collateral security for any of the
Guaranteed Obligations. The provisions of this Undertaking are severable, and in
any action or proceeding involving any state corporate law, or any state or
federal bankruptcy, insolvency, reorganization or other law affecting the rights
of creditors generally, if the obligations of Performance Guarantor hereunder
would otherwise be held or determined to be avoidable, invalid or unenforceable
on account of the amount of Performance Guarantor's liability under this
Undertaking, then, notwithstanding any other provision of this Undertaking to
the contrary, the amount of such liability shall, without any further action by
Performance Guarantor or Recipient, be automatically limited and reduced to the
highest amount that is valid and enforceable as determined in such action or
proceeding. Any provisions of this Undertaking which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Unless otherwise specified, references herein to "SECTION"
shall mean a reference to sections of this Undertaking.
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IN WITNESS WHEREOF, Performance Guarantor has caused this Undertaking
to be executed and delivered as of the date first above written.
X. X. TOWER Corporation
By:
-------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
ADDRESS FOR NOTICES: X. X. Tower Corporation
0000 Xxxxxxx Xxxx, X.X.
Xxxxx Xxxxxx, XX 00000
ATTENTION: Xxxxxx X. Xxxxxx
TELEPHONE: (000) 000-0000
FACSIMILE: (000) 000-0000
X-9
SCHEDULE A
DOCUMENTS TO BE DELIVERED TO THE AGENT
ON OR PRIOR TO THE INITIAL PURCHASE
1. Executed copies of the Receivables Purchase Agreement, duly executed
by the parties thereto.
2. Copy of the Resolutions of the Board of Directors of each Seller
Party and Performance Guarantor certified by its Secretary authorizing such
Person's execution, delivery and performance of this Agreement and the other
documents to be delivered by it hereunder.
3. Articles or Certificate of Incorporation of each Seller Party and
Performance Guarantor certified by the Secretary of State of its jurisdiction of
incorporation on or within thirty (30) days prior to the initial Purchase.
4. Good Standing Certificate for each Seller Party and Performance
Guarantor issued by the Secretaries of State of its state of incorporation and
each jurisdiction where it has material operations, each of which is listed
below:
a. Seller: Tower Automotive Receivables Company, Inc.
b. Servicer: X. X. Tower Corporation.
c. Performance Guarantor: X. X. Tower Corporation.
5. A certificate of the Secretary of each Seller Party and Performance
Guarantor certifying (i) the names and signatures of the officers authorized on
its behalf to execute this Agreement and any other documents to be delivered by
it hereunder and (ii) a copy of such Person's By-Laws.
6. Pre-filing state and federal tax lien, judgment lien and UCC lien
searches against each Seller Party from the following jurisdictions:
a. Seller: Michigan
b. Servicer: Michigan, Delaware
7. Financing statements, executed and in proper form for filing under
the UCC on or before the date of the initial Purchase in all jurisdictions as
may be necessary or, in the opinion of the Agent, reasonably desirable, under
the UCC of all appropriate jurisdictions or any comparable law in order to
perfect the ownership interests contemplated by this Agreement.
8. Executed copies of Collection Account Agreements for each Lock-Box
and Collection Account.
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9. A favorable opinion of legal counsel for the Seller Parties and
Performance Guarantor reasonably acceptable to the Agent which addresses the
following matters and such other matters as the Agent may reasonably request:
(a) Each of the Seller Parties and Performance Guarantor is a
corporation duly organized, validly existing, and in good standing under the
laws of its respective state of incorporation.
(b) Each of the Seller Parties and Performance Guarantor has all
requisite authority to conduct its business in each jurisdiction where failure
to be so qualified would have a material adverse effect on such entity's
business.
(c) The execution and delivery by each of the Seller Parties and
Performance Guarantor of the Transaction Document to which it is a party and its
performance of its obligations thereunder have been duly authorized by all
necessary organizational action and proceedings on the part of such entity and
will not:
(i) require any action by or in respect of, or filing with, any
governmental body, agency or official (other than the filing of UCC
financing statements);
(ii) contravene, or constitute a default under, any provision of
applicable statutory law or regulation or of its articles or certificate of
incorporation or bylaws or of any material agreement, judgment, injunction,
order, decree or other instrument binding upon such entity; or
(iii) result in the creation or imposition of any Adverse Claim on
assets of such entity or any of its Subsidiaries (except as contemplated by
the Transaction Documents).
(d) Each of the Transaction Documents to which each of the Seller
Parties and Performance Guarantor is a party has been duly executed and
delivered by such entity and constitutes the legally valid, and binding
obligation of such entity enforceable in accordance with its terms, except to
the extent the enforcement thereof may be limited by bankruptcy, insolvency or
similar laws affecting the enforcement of creditors' rights generally and
subject also to the availability of equitable remedies if equitable remedies are
sought.
(e) The provisions of the Receivables Purchase Agreement are effective
to create valid security interests in favor of the Agent, for the benefit of the
Secured Parties, in all of Seller's right, title and interest in and to the
Receivables and Related Security described therein which constitute "accounts"
(as defined in the UCC) (collectively, the "OPINION COLLATERAL"), as security
for the payment of the Aggregate Unpaids.
(f) Each of the UCC-1 Financing Statements naming Seller as debtor, and
Agent, as secured party, to be filed in the [describe filing offices], is in
appropriate form for filing therein. Upon filing of such UCC-1 Financing
Statements in such filing offices and payment of the required filing fees, the
security interest in favor of the Agent, for the benefit of the Secured Parties,
in the Opinion Collateral will be perfected.
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(g) Based solely on our review of the [describe UCC Search Reports],
and assuming (i) the filing of the Financing Statements and payment of the
required filing fees in accordance with paragraph (f) and (ii) the absence of
any intervening filings between the date and time of the Search Reports and the
date and time of the filing of the Financing Statements, the security interest
of the Agent in the Opinion Collateral is prior to any security interest granted
in the Opinion Collateral by Seller, the priority of which is determined solely
by the filing of a financing statement in the [describe filing offices].
(h) Neither of the Seller Parties is a "holding company" or a
"subsidiary holding company" of a "holding company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.
10. A Compliance Certificate.
11. The Fee Letter.
12. A Monthly Report as at May 31, 2001.
13. The Liquidity Agreement, duly executed by each of the parties
thereto.
14. If applicable, for each Liquidity Bank that is not incorporated
under the laws of the United States of America, or a state thereof, two duly
completed copies of United States Internal Revenue Service Form W-8BEN or
W-8ECI, as applicable, certifying in either case that such Liquidity Bank is
entitled to receive payments under the Agreement without deduction or
withholding of any United States federal income taxes.
X-12
SCHEDULE B
APPROVED BUSINESS UNITS
1. Auburn
2. Bardstown
3. Bluffton
4. Bowling Green
5. Granite City
6. Kendallville
7. Milan
8. Ram
9. Ranger
10. Traverse City
11. Clinton
12. Elktown
13. Sebewaing
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