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EXECUTION COPY
AMENDED AND RESTATED
LEASE RECEIVABLES PURCHASE AGREEMENT
Dated as of March 31, 2000
among
HPSC BRAVO FUNDING CORP.,
as Seller
HPSC, INC.,
as Servicer
TRIPLE-A ONE FUNDING CORPORATION
and
CAPITAL MARKETS ASSURANCE CORPORATION,
as Administrative Agent and Collateral Agent
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TABLE OF CONTENTS
ARTICLE I.........................................................................................................1
DEFINITIONS.......................................................................................................1
SECTION 1.01 Certain Definitions..............................................................................1
SECTION 1.02. Accounting Terms................................................................................1
SECTION 1.03. Other Terms.....................................................................................2
SECTION 1.04. Computation of Time Periods.....................................................................2
ARTICLE II........................................................................................................2
AMOUNT AND TERMS OF THE PURCHASES.................................................................................2
SECTION 2.01. Receivables Purchase Facility...................................................................2
SECTION 2.02. Making Purchases from the Seller................................................................3
SECTION 2.03. Reduction of Facility Limit.....................................................................5
SECTION 2.04. Settlement Procedures...........................................................................5
SECTION 2.05. Payments and Computations, Etc..................................................................6
SECTION 2.06. Compensation....................................................................................7
SECTION 2.07. Dividing or Combining of Capital and Fixed Periods..............................................7
SECTION 2.08. Increased Costs, Capital Adequacy...............................................................7
SECTION 2.09. Taxes...........................................................................................8
SECTION 2.10. Fees............................................................................................9
SECTION 2.11. Grant of Security Interest in Equipment Collateral..............................................9
ARTICLE III......................................................................................................10
CONDITIONS OF PURCHASES..........................................................................................10
SECTION 3.01. Conditions Precedent to Initial Receivables Purchase...........................................10
SECTION 3.02. Conditions Precedent to Each Receivables Purchase..............................................11
ARTICLE IV.......................................................................................................13
REPRESENTATIONS AND WARRANTIES...................................................................................13
SECTION 4.01. Representations and Warranties of the Seller...................................................13
ARTICLE V........................................................................................................18
GENERAL COVENANTS................................................................................................18
SECTION 5.01. Affirmative Covenants of the Seller............................................................18
SECTION 5.02. Reporting Requirements of the Seller...........................................................22
SECTION 5.03. Negative Covenants of the Seller...............................................................23
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ARTICLE VI.......................................................................................................26
ADMINISTRATION AND COLLECTION....................................................................................26
SECTION 6.01. Designation of Servicer........................................................................26
SECTION 6.02. Duties of the Servicer.........................................................................27
SECTION 6.03. Rights of the Collateral Agent.................................................................29
SECTION 6.04. Further Action Evidencing Transfers............................................................29
SECTION 6.05. Responsibilities of the Seller.................................................................30
SECTION 6.06. Administration of Collections by Servicer......................................................30
SECTION 6.07. Application of Collections.....................................................................31
SECTION 6.08. Servicing Fee..................................................................................31
SECTION 6.09. Resignation; Successor Servicer................................................................31
SECTION 6.10. Lock-Box Accounts; Collection Account..........................................................32
SECTION 6.11. Collection Account.............................................................................32
ARTICLE VII......................................................................................................35
WIND-DOWN EVENTS; REMEDIES.......................................................................................35
SECTION 7.01. Wind-Down Events...............................................................................35
SECTION 7.02. Remedies.......................................................................................37
ARTICLE VIII.....................................................................................................37
INDEMNIFICATION; REPURCHASES.....................................................................................37
SECTION 8.01. Indemnities by the Seller......................................................................37
ARTICLE IX.......................................................................................................41
MISCELLANEOUS....................................................................................................41
SECTION 9.01. Amendments, Etc................................................................................41
SECTION 9.02. Notices, Etc...................................................................................41
SECTION 9.03. No Waiver; Remedies............................................................................41
SECTION 9.04. Binding Effect; Assignability..................................................................41
SECTION 9.05. GOVERNING LAW; WAIVER OF JURY TRIAL............................................................42
SECTION 9.06. Costs, Expenses and Taxes......................................................................43
SECTION 9.07. Execution in Counterparts; Severability........................................................43
SECTION 9.08. No Bankruptcy Petition Against Triple-A........................................................43
SECTION 9.09. Reference to and Effect on Prior LRPA and Credit Agreement.....................................43
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APPENDICES
APPENDIX A DEFINITIONS LIST
LIST OF EXHIBITS
EXHIBIT A Form of Sale Notice
EXHIBIT B Form of Opinion of Counsel
EXHIBIT C Form of Officer's Certificate
EXHIBIT D List of Offices of Originator Where Records Are Kept
EXHIBIT E Form of Interest Rate Hedge Assignment
EXHIBIT F Historical Static Loss Data
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EXECUTION COPY
AMENDED AND RESTATED
LEASE RECEIVABLES PURCHASE AGREEMENT
THIS AMENDED AND RESTATED LEASE RECEIVABLES PURCHASE AGREEMENT, dated as of
March 31, 2000 (as the same may be amended, restated, supplemented or otherwise
modified from time to time, the "TRIPLE-A PURCHASE AGREEMENT"), is entered into
by and among HPSC BRAVO FUNDING CORP., a Delaware corporation, as Seller (the
"SELLER"), HPSC, INC., a Delaware corporation, as Servicer (the "SERVICER"),
TRIPLE-A ONE FUNDING CORPORATION, a Delaware corporation ("TRIPLE-A") and
CAPITAL MARKETS ASSURANCE CORPORATION, a New York stock insurance company
("CAPMAC"), as Collateral Agent and as Administrative Agent (in such capacities,
the "COLLATERAL AGENT" or the "ADMINISTRATIVE AGENT").
W I T N E S S E T H:
WHEREAS, the Seller, the Servicer, Triple-A, and CapMAC are parties to that
certain Lease Receivables Purchase Agreement, dated as of October 18, 1996 (as
amended, the "Prior LRPA"); and
WHEREAS, the Seller, the Servicer, Triple-A, and CapMAC desire to amend and
restate the Prior LRPA in certain respects;
NOW, THEREFORE, the Seller, the Servicer, Triple-A, and CapMAC have agreed
to amend and restate the Prior LRPA in its entirety as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 CERTAIN DEFINITIONS. As used in this Triple-A Purchase
Agreement or any certificate or other document made or delivered pursuant hereto
or thereto, the capitalized terms used herein and therein shall, unless
otherwise defined herein or therein, have the meanings assigned to them in the
Definitions List attached hereto as Appendix A, the terms of which are
incorporated herein by reference (the "DEFINITIONS LIST"). Any reference in the
Facility Documents to a note, instrument, or other agreement substantially in
the form of Exhibit K-1, K-2, K-3, or K-4 to the Purchase Agreement, as
applicable, shall mean and be a reference to a note, instrument or other
agreement in substantially one of the forms included in such Exhibit.
SECTION 1.02. ACCOUNTING TERMS. As used herein and in any certificate or
other document made or delivered pursuant hereto and thereto, accounting terms
not defined in the Definitions List and accounting terms partly defined in the
Definitions List to the extent not defined, shall have the respective meanings
given to them under GAAP.
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SECTION 1.03. OTHER TERMS. (a) All other undefined terms contained in this
Triple-A Purchase Agreement shall, unless the context indicates otherwise, have
the meanings provided for by the UCC to the extent the same are used or defined
therein.
(b) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Triple-A Purchase Agreement shall refer to this
Triple-A Purchase Agreement as a whole and not to any particular provision of
this Triple-A Purchase Agreement, and Section, subsection, Schedule and Exhibit
references are to this Triple-A Purchase Agreement unless otherwise specified.
(c) Capitalized terms used herein shall be equally applicable to both the
singular and plural forms of such terms.
SECTION 1.04. COMPUTATION OF TIME PERIODS. In this Triple-A Purchase
Agreement, in the computation of periods of time from a specified date to a
later specified date, the word "from" shall mean "from and including" and the
words "to" and "until" shall each mean "to but excluding."
ARTICLE II
AMOUNT AND TERMS OF THE PURCHASES
SECTION 2.01. RECEIVABLES PURCHASE FACILITY. Triple-A shall subject to the
terms and conditions hereinafter set forth, make purchases of Receivables
("RECEIVABLES PURCHASES") from time to time on any Settlement Date (except that
the initial Receivables Purchase may be on a date other than a Settlement Date)
during the period from the date the conditions precedent in SECTION 3.01 are
satisfied to the Termination Date. Notwithstanding the foregoing, if, at any
time, two or more of the individuals who held the positions of Chief Executive
Officer, Chief Financial Officer and President of the Servicer as of April 30,
1998 no longer remain actively involved in the day-to-day management of the
Servicer, then Triple-A is no longer required to, but may, in its sole
discretion, make Receivables Purchases. Each Receivables Purchase shall
constitute an assignment and sale by the Seller, and a purchase and acquisition
by Triple-A of Purchased Assets, including, without limitation, Designated
Receivables identified as Eligible Receivables by the Seller, and Related
Security and Collections with respect thereto. Under no circumstances shall
Triple-A make any Receivables Purchase if, after giving effect to such
Receivables Purchase, the aggregate outstanding Capital hereunder would exceed
the least of (i) the Facility Limit, (ii) the Capital Limit, or (iii) the sum,
on such Receivables Purchase Date, of (a) the net proceeds from the sale of
Commercial Paper PLUS (b) the proceeds of Advances. The Capital Limit in effect
on any date shall be determined by reference to the most recent Settlement
Report delivered by the Seller to Triple-A in accordance with SECTION 5.02(f)
hereof (i) as adjusted on the most recent Settlement Date to reflect additional
Eligible Receivables sold on such Settlement Date since the delivery of such
Settlement Report and (ii) as adjusted on any other date of determination to
eliminate from the Discounted Eligible Receivables Balance any Receivables which
were Eligible Receivables as of the dates reflected in the Settlement Report but
which no longer satisfy the criteria for Eligible Receivables. It is the
intention of the parties hereto that each Receivables Purchase to be made
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hereunder shall constitute either (i) a "sale of accounts or chattel paper", as
such term is used in Article 9 of the UCC, or (ii) a sale of "instruments", as
such term is used in Article 9 of the UCC. If at any time a court characterizes
the transactions hereunder as loans by Triple-A to the Seller, then the Seller
hereby pledges, grants a security interest in and assigns to the Collateral
Agent, for the benefit of Triple-A, all of the right and title to and interest
in the Purchased Assets, including the Purchased Receivables and the Related
Security, Collections and Equipment related thereto, as security for such loans
and for the payment and performance of all obligations of the Seller hereunder.
SECTION 2.02. MAKING PURCHASES FROM THE SELLER.
(a) SALE NOTICE. Whenever the Seller wishes to sell Receivables hereunder,
it shall deliver to Triple-A a notice ("SALE NOTICE") in substantially the form
of EXHIBIT A hereto no later than 10:00 A.M. (New York City time) on the
Business Day immediately prior to the proposed Receivables Purchase Date;
PROVIDED that, in the case of any Capital funded as part of a Receivables
Purchase with respect to which Yield is to be calculated at the Eurodollar Rate,
such Sale Notice must be given not later than 10:00 A.M. (New York City time) at
least three (3) Business Days prior to the proposed Receivables Purchase Date.
Each Sale Notice shall be by telephone, telex, telecopy, cable or other
facsimile transmission (in the case of any such Sale Notice by telephone,
confirmed immediately in writing) and shall specify therein the (i) aggregate
initial Capital to be funded in connection with such Receivables Purchase, (ii)
the date of such Receivables Purchase and (iii) the duration of the initial
Fixed Period(s) for such Capital. In addition to the foregoing, the Seller shall
indicate which Receivables subject to such Sale Notice are Designated
Receivables and which Receivables subject to such Sale Notice are Non-Designated
Receivables.
(b) AMOUNT OF PURCHASED ASSETS; DEFERRED PURCHASE PRICE. The consideration
for each Receivables Purchase shall consist of the Capital funded under this
Agreement and the obligation of the Purchaser to remit to the Seller the
Deferred Purchase Price. The amount of the Deferred Purchase Price shall be
initially computed as of the opening of business of the Collection Agent on the
date of the initial Receivables Purchase hereunder. Thereafter until the
Termination Date, the amount of the Deferred Purchase Price shall be
automatically recomputed as of the close of business of the Collection Agent on
each day on which the aggregate Capital hereunder is increased or decreased or
on which any funds are remitted to the Seller in satisfaction thereof under
clause (v) of SECTION 6.11(b). From and after the Termination Date until the
Collection Date, the Deferred Purchase Price shall be automatically recomputed
on each Business Day to reflect any reductions in the amount hereof on account
of accrued Yield, Carrying Costs, or other amounts owed by (or paid on behalf
of) the Seller under this Agreement. The Purchased Assets shall become zero at
such time as Triple-A shall have recovered the aggregate outstanding Capital and
shall have received all other amounts payable to Triple-A pursuant to this
Triple-A Purchase Agreement and the Seller has received payment of the Deferred
Purchase Price. The Purchased Assets and the Deferred Purchase Price shall each
remain constant from the time as of which any such computation or recomputation
is made until the time as of which the next such recomputation, if any, shall be
made. Triple-A shall, in consideration of the sale of the Purchased Assets, from
and after the Collection Date, remit to the
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Seller with the proceeds of Collections in respect of the Purchased Assets, in
satisfaction of the Deferred Purchase Price; PROVIDED that, from and after the
date that the Outstanding Balance of the Purchased Receivables is less than or
equal to 10% of the Outstanding Balance of the Purchased Receivables as of the
Termination Date, the Administrative Agent may, in lieu of continuing to make
such remittances, by at least three (3) Business Days' prior written notice to
the Seller, reassign to the Seller all of Triple-A's right, title and interest
in and to the Purchased Assets in full satisfaction of the Deferred Purchase
Price. It is expressly understood and agreed that the Deferred Purchase Price
shall be payable solely through Collections and other proceeds of the Purchased
Assets and that none of Triple-A, the Administrative Agent, the Collateral Agent
nor any Liquidity Bank shall have any personal liability for the payment of the
Deferred Purchase Price.
(c) SELECTION OF FIXED PERIODS. Promptly upon receiving each Sale Notice,
the Administrative Agent shall, following its review of the Seller's proposal,
select Fixed Periods for all Capital so that all outstanding Capital is at all
times allocated to a Fixed Period (it being understood that if the Seller does
not propose a specific Fixed Period, the Administrative Agent shall select such
Fixed Period in its discretion). The initial Fixed Period for any Capital shall
be specified in the Sale Notice described in SUBSECTION (A) hereof. At least one
Business Day prior to the last day of each Fixed Period for any Capital
allocated to such Fixed Period, the Seller shall request new Fixed Periods for
such Capital; PROVIDED that, in the case of any Fixed Period for Capital for
which Yield is to be determined by reference to the Eurodollar Rate, such
request shall be given not later than 10:00 A.M. (New York City time) at least
three (3) Business Days prior to the last day of the relevant Fixed Period. The
Administrative Agent shall, on the date of any Receivables Purchase hereunder
and, so long as any Capital related to such Receivables Purchase is outstanding,
on the first day of each successive Fixed Period for such Capital, notify the
Collateral Agent and the Seller of the duration of the relevant Fixed Period and
the Yield which will be applicable to the Capital during such Fixed Period. Any
Fixed Period that commences before the Termination Date and would otherwise end
on a date occurring after the Termination Date shall end on the Termination Date
and the duration of any Fixed Period that commences on or after the Termination
Date shall be of such duration as shall be selected by the Administrative Agent.
In addition, if a CP Disruption shall have occurred and be continuing, Triple-A,
or the Administrative Agent on its behalf, may, upon notice to the Originator
and the Seller, terminate any Fixed Period then in effect if Triple-A has funded
the Capital allocated to such Fixed Period by issuing Commercial Paper. All
outstanding Capital shall be assigned a Fixed Period at all times, which Fixed
Periods will be limited as set forth in the definition thereof.
(d) FUNDING. Triple-A shall, before 3:00 P.M. (New York City time) on the
proposed Receivables Purchase Date of each Receivables Purchase, subject to the
applicable conditions set forth in ARTICLE IV, make available to the Seller a
wire transfer of such funds to the Seller in accordance with the Seller's
written wire transfer instructions.
SECTION 2.03. REDUCTION OF FACILITY LIMIT. The Seller shall have the right,
at any time upon at least three (3) Business Days' notice to Triple-A, to
terminate in whole or reduce in part the unused portion of the Facility Limit in
a minimum amount of $10,000,000 and
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increments of $1,000,000 in excess thereof; PROVIDED that if the aggregate of
the simultaneous reductions in the Facility Limit hereunder and under the Credit
Agreement satisfy such test, the Seller may reduce the unused portion of the
Facility Limit hereunder in a minimum amount of $3,000,000 and increments of
$600,000 in excess thereof; PROVIDED, that in no event shall the Facility Limit
be reduced to less than the amount of Capital then outstanding. Any such
termination shall be without premium or penalty of any kind, except for any
indemnification which may be owed in connection with such termination pursuant
to SECTION 2.06 and SECTION 8.01.
SECTION 2.04. SETTLEMENT PROCEDURES.
(a) Any Collections of Purchased Receivables received (or deemed to
have been received) by the Seller shall be remitted directly to Triple-A by
depositing such Collections in the Lock-Box Account within one Business Day of
Seller's receipt (or deemed receipt) thereof. On each Payment Date, the Seller
shall pay to Triple-A (i) Yield on all outstanding Capital the Fixed Period for
which ends on such date PLUS (ii) the CP Dealer Fees, if any, on any Commercial
Paper maturing on such date and raised to fund such Capital.
(b) On each Settlement Date to occur prior to the Designated
Termination Date, the Seller shall either:
(i) if Triple-A has consented thereto, sell additional Receivables
hereunder in accordance with the procedures and subject to the conditions
set forth in SECTION 2.01 such that, immediately following such Receivables
Purchase, the Capital Limit equals or exceeds outstanding Capital, in which
event the Collateral Agent shall, subject to the order of priority set
forth in SECTION 6.11(b), remit the Collections so set aside to the Seller
in consideration of the purchase price for such Receivables Purchase; or
(ii) if Triple-A has not consented to such additional purchase, out of
the Collections so set aside, direct the Collateral Agent to remit to the
Administrative Agent, subject to the order of priority set forth in SECTION
6.11, an amount of such Collections to be applied toward the reduction of
outstanding Capital such that, following the application of such
Collections to outstanding Capital, the Capital Limit equals or exceeds the
outstanding Capital.
(c) On each Payment Date from and after the Designated Termination
Date, the Seller shall direct the Collateral Agent to distribute to the
Administrative Agent for the benefit of Triple-A, to be applied toward the
reduction of outstanding Capital, all Collections so set aside but not to exceed
the sum of (i) the Capital allocated to such Fixed Period, (ii) all accrued and
unpaid Yield thereon, and (iii) the aggregate of all other amounts owed
hereunder by the Seller to Triple-A and/or the Administrative Agent, all as more
fully set forth in SECTION 6.11.
(d) If on any day the Outstanding Balance of any Purchased Receivable
is either (i) reduced or adjusted as a result of any defective, rejected,
returned, repossessed or foreclosed merchandise, any defective or rejected
services, any cash discount or any other
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adjustment made or performed by the Seller or any other Person (including,
without limitation, those described in the definition of "DILUTION FACTORS"), or
(ii) reduced or canceled as a result of a setoff in respect of any claim by the
Obligor thereof against the Seller or any other Person (whether such claim
arises out of the same or a related transaction or an unrelated transaction),
the Seller shall be deemed to have received on such day a Collection of such
Purchased Receivable in the amount of such reduction, cancellation or
adjustment. If on any day any of the representations or warranties in SECTION
4.01(g) is no longer true with respect to a Purchased Receivable or if the
Seller has breached its obligations under SECTION 5.01(j), then the Seller shall
be deemed to have received on such day a Collection of such Purchased
Receivable: (x) if such representation, warranty or covenant relates to the
non-existence of any Adverse Claims, the Seller shall be deemed to have received
a Collection of such Purchased Receivable in the dollar amount of the Adverse
Claims attaching thereto and (y) if such representation or warranty relates to
the validity or perfection of the transfer of such Purchased Receivable under
this Triple-A Purchase Agreement or the perfection of Triple-A's security
interest in any Equipment as against the Obligor thereunder, then the Seller be
deemed to have received a Collection of such Purchased Receivable in an amount
equal to the Outstanding Balance thereof. To the extent that any such deemed
Collection reduces the Outstanding Balance of such Purchased Receivable to zero,
then, upon the Seller's payment to the Collateral Agent of such deemed
Collection, the Collateral Agent shall re-assign to the Seller all of its right,
title and interest in and to the relevant Purchased Receivable, the Contract
under which such Purchased Receivable arose and the Related Security relating
thereto.
(e) Although the Originator, the Seller and Triple-A agree that the
Originator shall have no right to so terminate, reject or not assume a Contract,
if the Originator in its capacity as Servicer (or its successor in interest,
including a trustee appointed under the Bankruptcy Code) terminates, rejects or
does not assume a Contract, in whole or in part, prior to the expiration of the
original term of such Contract, whether such rejection, termination or
non-assumption is made pursuant to an equitable cause, statute, regulation,
judicial proceeding or other applicable law (including, without limitation,
Section 365 of the Bankruptcy Code), then (i) the Seller shall be deemed to have
received Collections with respect to Purchased Receivables arising under such
Contract in an amount equal to (A) in the event of a prepayment or termination
consented to by the Originator at the Obligor's request, the excess, if any, of
the Termination Amount over all amounts paid by the Obligor on account of such
termination or (B) in the event of any other rejection or non-assumption, the
amount, of the Outstanding Balance thereof that has not been, or may not be paid
as a result of such rejection, termination or non-assumption. Upon the Seller's
payment of any such deemed Collections described in this SECTION 2.05(e), the
Collateral Agent shall re-assign to the Seller all of its right, title and
interest in and to the relevant Purchased Receivable or Purchased Receivables,
the Contracts under which such Purchased Receivable(s) arose and the Related
Security relating thereto.
SECTION 2.05. PAYMENTS AND COMPUTATIONS, ETC. All amounts to be paid
or deposited by the Seller hereunder shall be paid or deposited by the Seller in
immediately available funds to Triple-A not later than 1:00 P.M. (New York City
time) on the date on which payable. Payments received by Triple-A after such
time shall be deemed to have been received on the next Business Day. All
payments by the Seller under this Triple-A Purchase Agreement
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shall be made without setoff, deduction or counterclaim and the Seller agrees to
pay on demand any present or future stamp or documentary taxes or any other
excise or property taxes, charges or similar levies which arise from any payment
made hereunder or from the execution, delivery or registration of, or otherwise
with respect to, this Triple-A Purchase Agreement. Whenever any payment to be
made hereunder shall be stated to be due on a day which is not a Business Day,
the due date thereof shall be extended to the next applicable Business Day and
interest shall be payable at the applicable rate during such extension;
PROVIDED, that if such extension would be inconsistent with one of the
provisions set forth in the definition of "Fixed Period", then such provision
shall control.
SECTION 2.06. COMPENSATION. The Seller shall compensate Triple-A, upon
its written request, for all losses, expenses and liabilities, including,
without limitation, any indemnification payments owed by Triple-A pursuant to
the Liquidity Agreement, on account of any liquidation or reemployment of
deposits or other funds acquired by such party to make, fund or maintain Capital
hereunder, (i) if for any reason a Receivables Purchase does not occur on a date
specified therefor in the Sale Notice; (ii) if for any reason any payment,
prepayment or conversion of any Capital occurs on a date which is not the last
day of the Fixed Period for such Capital or (iii) as a consequence of any
required conversion of any Eurodollar Rate Advance prior to the last day of the
Fixed Period for the relevant Capital. Any request for compensation under this
SECTION 2.06 shall be accompanied by a copy of a statement from Triple-A setting
forth in reasonable detail the basis for requesting compensation and the
determination of the amount thereof in such statement shall be conclusive and
binding for all purposes, absent manifest error.
SECTION 2.07. DIVIDING OR COMBINING OF CAPITAL AND FIXED PERIODS. The
Seller may, on notice to and with the consent of the Administrative Agent
received at least one Business Day prior to the last day of any Fixed Period,
either (a) divide such Capital so as to allocate such Capital to two or more
Fixed Periods, or (b) combine such Capital with other Capital originating on
such last day or having Fixed Periods ending on such last day so as to allocate
all such Capital to a single Fixed Period. On and after the Termination Date,
the Administrative Agent shall have the right to divide and/or combine Capital
for purposes of allocation to Fixed Periods in any manner which it may select in
its sole discretion.
SECTION 2.08. INCREASED COSTS, CAPITAL ADEQUACY.
(a) If, after the date hereof due to either (i) the introduction of
or any change in or to the interpretation of any law or regulation by the
governmental authority that promulgated or administers compliance with such law
or regulation (other than laws or regulations with respect to income taxes or
any change by way of imposition or increase of reserve requirements included in
the Eurodollar Reserve Percentage) or (ii) the compliance with any guideline or
request from any central bank or other governmental authority or similar agency
(whether or not having the force of law), and taking into account the
obligations of the Liquidity Banks under the Liquidity Agreement and otherwise
in connection with Triple-A's asset-supported financing business, any reserve or
deposit or similar requirement shall be imposed, modified or deemed applicable
or, any basis of taxation shall be changed or any other
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condition shall be imposed, and there shall be any increase in the cost to
Triple-A (either directly or indirectly through any increase in the costs to the
Liquidity Banks) of making, funding, or maintaining Receivables Purchases or in
the cost to Triple-A of agreeing to make, fund, or maintain Receivables
Purchases (including the reduction of any sum received or Receivable hereunder),
then the Seller shall from time to time, upon demand by Triple-A by the
submission of the certificate described below, pay to Triple-A additional
amounts sufficient to compensate Triple-A for such increased cost. A certificate
setting forth in reasonable detail the amount of such increased cost submitted
to the Seller by Triple-A shall be conclusive and binding for all purposes,
absent manifest error.
(b) If Triple-A or any Liquidity Bank determines that compliance with
any law or regulation or any guideline or request or any written interpretation
from any central bank or other governmental authority or similar agency (whether
or not having the force of law) which is introduced, implemented or received by
Triple-A or such Liquidity Bank after the date hereof, affects or would affect
capital adequacy or the amount of capital required or expected to be maintained
by Triple-A or such Liquidity Bank or any corporation controlling Triple-A or
such Liquidity Bank and that the amount of such capital is increased by or based
upon the Triple-A Loans or the existence of this Triple-A Purchase Agreement or
upon the Advances or such Liquidity Bank's commitment to lend under the
Liquidity Agreement and other commitments of that type, or has or would have the
effect of reducing the rate of return on capital, then, upon demand by Triple-A
by the submission of the certificate described below, the Seller shall pay to
Triple-A, from time to time as specified by Triple-A, additional amounts
sufficient to compensate Triple-A or such corporation in the light of such
circumstances, to the extent that Triple-A reasonably determines such increase
in capital to be allocable to the Receivables Purchases or the existence of this
Triple-A Purchase Agreement or to the extent that Triple-A owes compensation to
a Liquidity Bank in respect of or on account of such events. A certificate
setting forth in reasonable detail such amounts submitted to the Seller by
Triple-A shall be conclusive and binding for all purposes, absent manifest
error.
(c) In the event that Triple-A requests compensation for increased
costs on behalf of any Liquidity Bank under this SECTION 2.08 and such increased
costs are not being requested by the other Liquidity Banks generally or, if only
one Liquidity Bank exists, by Triple-A's liquidity providers for similar
transactions, then Triple-A shall, promptly following identification by the
Seller of an "Eligible Assignee" (as defined in the Liquidity Agreement) willing
to accept such commitment, cause the Liquidity Bank requesting such increased
costs to assign its outstanding Advances and commitments under the Liquidity
Agreement to such Eligible Assignee, all as more particularly described in
SECTION 8.06(g) of the Liquidity Agreement.
SECTION 2.09. TAXES. (a) All payments made by the Seller under this
Triple-A Purchase Agreement shall be made free and clear of, and without
deduction or withholding for or on account of, any present or future taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any governmental
authority having taxing authority, excluding net income taxes and franchise
taxes (imposed in lieu of income taxes) imposed on Triple-A, as a result of any
present or former
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connection between the jurisdiction of the government or taxing authority
imposing such tax or any political subdivision or taxing authority thereof or
therein and Triple-A (excluding a connection arising solely from Triple-A having
executed, delivered or performed its obligations or received a payment under, or
enforced, this Triple-A Purchase Agreement) (all such non-excluded taxes,
levies, imposts, duties, charges, fees, deductions and withholdings being
hereinafter called "TAXES"). If any Taxes are required to be withheld from any
amounts payable by the Seller, (i) the sum payable shall be increased as may be
necessary so that, after making all required deductions (including deductions
applicable to additional sums payable under this SECTION 2.09), Triple-A
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Seller shall make such deductions, and (iii) the
Seller shall pay the full amount deducted to the relevant taxation authority or
other authority in accordance with applicable law.
(b) In addition, the Seller agrees to pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges, or similar
levies that arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Triple-A
Purchase Agreement (hereinafter "OTHER TAXES").
(c) The Seller will indemnify Triple-A for the full amount of Taxes
or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed
by any jurisdiction on amounts payable under this SECTION 2.09) paid by Triple-A
and any liability (including penalties, interest and expenses) arising therefrom
or with respect thereto. Whenever any Taxes are payable by the Seller, as
promptly as possible thereafter the Seller shall send to Triple-A, a certified
copy of an original official receipt received by the Seller showing payment
thereof. If the Seller fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to Triple-A the required receipts or other required
documentary evidence, the Seller shall indemnify Triple-A for any incremental
Taxes, interest or penalties that Triple-A is legally required to pay as a
result of any such failure. The agreements in this subsection shall survive the
termination of this Triple-A Purchase Agreement.
SECTION 2.10. FEES. In further consideration of the Receivables
Purchases to be made hereunder, the Seller agrees to pay to the Administrative
Agent and Triple-A all fees specified in the Fee Letter of even date herewith,
which fees will be due and payable at the times and in the manner set forth in
such Fee Letter.
SECTION 2.11. GRANT OF SECURITY INTEREST IN EQUIPMENT COLLATERAL. (a)
As security for the payment and performance of all the obligations of the Seller
hereunder and as additional enhancement to enable Triple-A, the Liquidity Banks
and CapMAC to fully recover Capital and accrued and unpaid Yield and fees, the
Seller hereby grants to the Collateral Agent, for the benefit of Triple-A, the
Liquidity Banks and CapMAC, a security interest in all of the Seller's right,
title and interest in and to the following, whether now owned or hereafter
acquired and whether now existing or hereafter arising (the "EQUIPMENT
COLLATERAL"): all Equipment which is the subject of a Contract for any Purchased
Receivable and substitutions therefor and products and proceeds thereof,
including, without limitation, all payments under insurance (whether or not the
Collateral Agent is the loss payee thereof) or any indemnity, warranty or
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guaranty, payable by reason of loss or damage to or otherwise with respect to
any of the foregoing.
(b) The Seller shall, at its expense, promptly execute and deliver
all further instruments and documents, and take all further action (including,
without limitation, the execution and filing of such financing or continuation
statements, or amendments thereto and assignments thereof), that may reasonably
be necessary or desirable, or that the Administrative Agent may request, in
order to perfect and protect any security interest granted or purported to be
granted to the Collateral Agent hereunder or to enable the Collateral Agent to
exercise and enforce its rights and remedies hereunder with respect to any
Equipment Collateral. The Seller hereby authorizes the Collateral Agent to file
one or more financing or continuation statements, and amendments thereto and
assignments thereof, relative to all or any part of the Equipment Collateral now
existing or hereafter arising without the signature of the Seller where
permitted by law. A carbon, photographic or other reproduction of the Triple-A
Purchase Agreement of any financing statement covering the Equipment Collateral
or any part thereof shall be sufficient as a financing statement.
ARTICLE III
CONDITIONS OF PURCHASES
SECTION 3.01. CONDITIONS PRECEDENT TO INITIAL RECEIVABLES PURCHASE.
The agreement of Triple-A to make a Receivables Purchase on the occasion of the
first Receivables Purchase after the date hereof is subject to satisfaction of
the following conditions precedent:
(a) Triple-A shall have received, on or before the initial Receivables
Purchase Date, all of the following, each fully executed and in form and
substance satisfactory to Triple-A:
(i) This Triple-A Purchase Agreement;
(ii) The Amended and Restated Purchase and Contribution Agreement,
dated as of the date hereof, between the Seller and HPSC, Inc.;
(iii) A copy of the resolutions of the Board of Directors of the
Seller approving this Triple-A Purchase Agreement and all other documents
and instruments to be delivered hereunder or thereunder by the Seller,
certified by its Secretary or Assistant Secretary;
(iv) A certificate of the Secretary or an Assistant Secretary of the
Seller certifying (A) the names and true signatures of the officers of the
Seller authorized to sign this Triple-A Purchase Agreement and the other
documents and instruments to be delivered by the Seller pursuant hereto or
thereto (on which certificate Triple-A may conclusively rely until such
time as Triple-A shall receive from the Seller a revised certificate
meeting the requirements of this subsection (iv)) and (B) a true and
complete copy of the By-laws of the Seller;
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(v) A certificate executed by an officer of the Seller certifying that
as of the initial Receivables Purchase Date, all of the representations and
warranties contained in ARTICLE IV hereof are true and accurate in all
material respects with the same force and effect as though such
representations and warranties had been made as of such time;
(vi) The Certificate of Incorporation of the Seller, certified by the
Secretary of State of Delaware;
(vii) Good Standing Certificates for the Seller issued by the
Secretaries of the States of Delaware and Massachusetts;
(viii) An Officer's Certificate in the form of EXHIBIT C, executed by
the President or the Treasurer of the Seller;
(b) All fees and expenses due and owing as of the initial Receivables
Purchase Date under the Fee Letter shall have been paid;
(c) Triple-A shall have received a Sale Notice from the Seller requesting
that Triple-A Purchase all Receivables currently funded under the Credit
Agreement and indicating that all such Receivables are to constitute Designated
Receivables hereunder; and
(d) Triple-A shall have received such other approvals or documents as it
may reasonably request.
SECTION 3.02. CONDITIONS PRECEDENT TO EACH RECEIVABLES PURCHASE. The
agreement of Triple-A to make a Receivables Purchase on the occasion of each
Receivables Purchase Date (including the initial Receivables Purchase) shall be
subject (i) to Triple-A's receipt of (A) a Settlement Statement for the most
recent calendar month then ended, (B) a notice from the Custodian in
substantially the form of Exhibit A to the Custodial Agreement confirming that
the Custodian has received the Contract Files required to be delivered to it
pursuant to SECTION 6.04(b) hereof and (C) such other approvals or documents as
Triple-A may reasonably request and (ii) to the condition precedent that on the
Receivables Purchase Date of such Receivables Purchase, before and after giving
effect to such Receivables Purchase and to the application of the proceeds
therefrom, the following statements shall be true (and each of the giving of the
applicable Sale Notice and the acceptance by the Seller of the proceeds of such
Receivables Purchase shall constitute a representation and warranty by the
Seller that on the Receivables Purchase Date of such Receivables Purchase,
before and after giving effect thereto and to the application of the proceeds
therefrom, such statements are true):
(i) the representations and warranties contained in Article IV hereof
and all representations and warranties of the Originator in the Purchase
Agreement are true and accurate as of the Receivables Purchase Date in all
material respects with the same force and effect as though such
representations and warranties had been made as of such time;
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(ii) no event has occurred and is continuing, or would result from
such Receivables Purchase, which constitutes an Event of Termination or an
Unmatured Event of Termination or a Wind-Down Event or Unmatured Wind-Down
Event;
(iii) the outstanding amount of all Capital after giving effect to
such Receivables Purchase shall be equal to or less than the Capital Limit;
and
(iv) the proceeds of such Receivables Purchase shall be used to fund a
Purchase of Transferred Assets under the Purchase Agreement to occur
simultaneously with such Receivables Purchase and all conditions to such
Purchase under the Purchase Agreement on such date have been satisfied or
waived.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller
represents and warrants to Triple-A that:
(a) DUE INCORPORATION AND GOOD STANDING. The Seller is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation. The Seller is duly qualified to do business as a
foreign corporation and is in good standing in every jurisdiction in which the
nature of its business requires it to be so qualified or where the ownership of
its properties or the nature of its activities makes such qualification
necessary, except where the failure to be so qualified would not materially
adversely affect (i) the collectibility of the Purchased Assets, (ii) the
collectibility of any Receivable, (iii) the business, properties, operations,
prospects, profits or condition (financial or otherwise) of the Seller or (iv)
the ability of the Seller to perform its obligations hereunder and under the
other Facility Documents to which it is a party.
(b) DUE AUTHORIZATION AND NO CONFLICT. The execution, delivery and
performance by the Seller of this Triple-A Purchase Agreement and all other
Facility Documents and the transactions contemplated hereby and thereby,
including the acquisition of the Transferred Assets under the Purchase Agreement
and the purchases contemplated hereunder, are within the Seller's corporate
powers, have been duly authorized by all necessary corporate action, do not
contravene (i) the Seller's charter or by-laws, (ii) any law, rule or regulation
applicable to the Seller, (iii) any contractual restriction contained in any
indenture, loan or credit agreement, lease, mortgage, security agreement, bond,
note, or other agreement or instrument binding on or affecting the Seller or its
property or (iv) any order, writ, judgment, award, injunction or decree binding
on or affecting the Seller or its property, and do not result in or require the
creation of any Adverse Claim upon or with respect to any of its properties; and
no transaction contemplated hereby requires compliance with any bulk sales act
or similar law. This Triple-A Purchase Agreement and the other Facility
Documents to which the Seller is a party have been duly executed and delivered
on behalf of the Seller.
(c) GOVERNMENTAL AND OTHER CONSENTS. Except for the filing of
financing statements pursuant to the UCC required to perfect the security
interests granted hereunder or under the other Facility Documents and except for
consents under certain contractual agreements which have been obtained, no
authorization, consent, approval or other action by, and no registration,
qualification, designation, declaration, notice to or filing with, any
governmental authority or other Person is or will be necessary in connection
with the execution and delivery of this Triple-A Purchase Agreement or any other
Facility Document to which the Seller is a party or any of the other documents
contemplated hereby or thereby, consummation of the transactions herein or
therein contemplated, or performance of or compliance with the terms and
conditions hereof or thereof, to ensure the legality, validity or enforceability
hereof or thereof.
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(d) ENFORCEABILITY OF FACILITY DOCUMENTS. This Triple-A Purchase
Agreement and each of the other Facility Documents to which the Seller is a
party have been duly and validly executed and delivered by the Seller and
constitute the legal, valid and binding obligation of the Seller enforceable in
accordance with their respective terms, except as enforceability may be limited
by bankruptcy, insolvency or similar laws relating to or affecting creditors'
rights generally and by equitable principles.
(e) NO LITIGATION. There are no actions, suits or proceedings at law
or in equity or by or before any governmental authority now pending or, to the
knowledge of the Seller, threatened against or affecting the Seller or any
property or rights of the Seller which purport to challenge the legality,
validity or enforceability of this Triple-A Purchase Agreement or any other
Facility Document or which may materially impair the ability of the Seller to
carry on business substantially as now being conducted or which may materially
adversely affect the condition (financial or otherwise), operations or
properties of the Seller.
(f) USE OF PROCEEDS. No proceeds of any Receivables Purchase will be
used by the Seller other than to fund a Purchase of Transferred Assets from the
Originator except that the Seller may net from the Purchase Price paid to the
Originator reasonable and necessary amounts for the funding of its operating
expenses.
(g) VALID TITLE AND PERFECTED INTEREST. Each Receivable, together
with the Contract related thereto, is owned by the Seller free and clear of any
Adverse Claim except as provided herein or in the Credit Agreement and, upon the
making of each Receivables Purchase, Triple-A shall acquire a valid and
perfected first priority undivided percentage ownership interest, to the extent
of the Purchased Assets, in each Purchased Receivable then existing or
thereafter arising and in the Related Security and Collections with respect
thereto, in each case free and clear of any Adverse Claim except as provided
hereunder or under the Credit Agreement, the Liquidity Agreement or the
Liquidity Security Agreement (except that the Collateral Agent will not have a
perfected security interest in any Collateral constituting Equipment which is
owned by the Seller and located in a state other than The Commonwealth of
Massachusetts); and no effective financing statement or other instrument similar
in effect covering any Purchased Receivable or the Related Security or
Collections with respect thereto shall at any time be filed except in favor of
the Collateral Agent in accordance with this Triple-A Purchase Agreement and the
Credit Agreement.
(h) ACCURACY OF INFORMATION. All certificates, reports, financial
statements and similar writings furnished by or on behalf of the Seller to
Triple-A, the Collateral Agent, or the Administrative Agent at any time pursuant
to any requirement of, or in response to any written request of any such party
under, this Triple-A Purchase Agreement or any other Facility Document or any
transaction contemplated hereby or thereby, have been, and all such
certificates, reports, financial statements and similar writings hereafter
furnished by the Seller to such parties will be, true and accurate in every
respect material to the transactions contemplated hereby on the date as of which
any such certificate, report, financial statement or similar writing was or will
be delivered, and shall not omit to state any material facts or any facts
necessary to make the statements contained therein not materially misleading.
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(i) GOVERNMENTAL REGULATIONS. The Seller is not an "investment
company" or a company controlled by an "investment company" registered or
required to be registered under the Investment Company Act of 1940, as amended,
or otherwise subject to any other federal or state statute or regulation
limiting its ability to incur indebtedness.
(j) MARGIN REGULATIONS. The Seller is not engaged, principally or as
one of its important activities, in the business of extending credit for the
purpose of "purchasing" or "carrying" any "margin stock" (as each of the quoted
terms is defined or used in Regulation T, U or X). No part of the proceeds of
any Receivables Purchase has been used for so purchasing or carrying margin
stock or for any purpose which violates, or which would be inconsistent with,
the provisions of Regulation T, U or X.
(k) LOCATION OF CHIEF EXECUTIVE OFFICE AND RECORDS. The chief place
of business and chief executive office of the Seller are located at the address
referred to in EXHIBIT D hereof and the locations of the offices where the
Seller keeps all the Records are listed on EXHIBIT D (or at such other
locations, notified to the Collateral Agent in accordance with SECTION 5.01(f),
in jurisdictions where all action required by SECTION 6.04 has been taken and
completed).
(l) LOCK-BOX ACCOUNTS. Each Obligor under a Contract has, within one
month of the date of Purchase of such Contract, been instructed to remit payment
on the Receivables to a Post Office Box for remittance to a Lock-Box Account or
directly to a Lock-Box Account substantially in the form of EXHIBIT G to the
Purchase Agreement. From and after the initial Purchase Date, the Originator
will have no right, title and/or interest to any of the Lock-Box Accounts and
will maintain no lock-box accounts in its own name for the collection of such
Receivables. The Seller has caused the Originator to deliver to the Collateral
Agent a duplicate key to each Post Office Box and has filed a standing delivery
order with the United States Postal Service authorizing the Collateral Agent to
receive mail delivered to each such Post Office Box. The account numbers of all
Lock-Box Accounts, together with the names and addresses of all the Lock-Box
Banks maintaining such Lock-Box Accounts and the related Post Office Boxes, are
specified in EXHIBIT H to the Purchase Agreement. The Seller has no other
Lock-Box Accounts for the collection of the Transferred Assets except for the
Lock-Box Accounts.
(m) NO TRADE NAMES. The Seller has no trade names, fictitious names,
assumed names or "doing business as" names.
(n) SEPARATE IDENTITY. The Seller is operated as an entity separate
from the Originator and each other Subsidiary of the Originator and (i) has its
own board of directors, (ii) has at least one director who is reasonably
acceptable to Triple-A and who is not a direct, indirect or beneficial
stockholder, officer, director, employee, affiliate, associate, customer or
supplier of the Originator nor a relative of any thereof, nor a trustee in
bankruptcy for any Affiliate of the Originator, (iii) maintains its assets in a
manner which facilitates their identification and segregation from those of its
Affiliates, and has a separate telephone number from that of the Originator or
any Subsidiary of the Originator, (iv) has all office furniture, fixtures and
equipment necessary to operate its business and such furniture, fixtures and
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equipment are either owned by the Seller or leased pursuant to written leases,
(v) conducts all intercompany transactions with the Originator and each other
Subsidiary of the Originator on terms which the Seller reasonably believes to be
on an arm's-length basis, (vi) has not guaranteed any obligation of the
Originator or any other Subsidiary of the Originator, nor has it had any of its
obligations guaranteed by any such entities and has not held itself out as
responsible for debts of any such entity or for the decisions or actions with
respect to the business and affairs of any such entity, (vii) has not, except as
otherwise expressly acknowledged under the Facility Documents, permitted the
commingling or pooling of its funds or other assets with the assets of the
Originator or any other Affiliate, (viii) has separate deposit and other bank
accounts to which neither the Originator nor any other Affiliate has any access
and does not at any time pool any of its funds with those of the Originator or
any such Affiliate, (ix) maintains financial records which are separate from
those of the Originator and each other Subsidiary of the Originator, (x)
compensates all employees, consultants and agents, or reimburses the Originator,
from the Seller's own funds, for services provided to the Seller by such
employees, consultants and agents, (xi) has agreed with the Originator to
allocate among themselves shared corporate operating services and expenses which
are not reflected in the Servicing Fee (including, without limitation, the
services of shared employees, consultants and agents and reasonable legal and
auditing expenses) on the basis of actual use or the value of services rendered,
and otherwise on a basis reasonably related to actual use or the value of
services rendered, (xii) pays directly for its own account for accounting and
payroll services, rent, lease and other expenses and does not have such
operating expenses paid by the Originator or any other Subsidiary of the
Originator, (xiii) conducts all of its business (whether in writing or orally)
solely in its own name, (xiv) is not, directly or indirectly, named as a direct
or contingent beneficiary or loss payee on any insurance policy covering the
property of the Originator or any other Subsidiary of the Originator and has
entered into no agreement to be named as such a beneficiary or payee, (xv)
acknowledges that Triple-A, the Administrative Agent, the Surety and the
Liquidity Banks are entering into the transactions contemplated by this Triple-A
Purchase Agreement and the other Facility Documents in reliance on the Seller's
identity as a separate legal entity from the Originator and each other
Subsidiary of the Originator, and (xvi) practices and adheres to corporate
formalities such as complying with its By-laws and corporate resolutions and the
holding of regularly scheduled board of directors meetings.
(o) SUBSIDIARIES. The Seller has no Subsidiaries and does not own or
hold, directly or indirectly, any capital stock or equity security of, or any
equity interest in, any Person.
(p) FACILITY DOCUMENTS. The Purchase Agreement is the only agreement
pursuant to which the Seller purchases Receivables or other Transferred Assets.
The Seller has furnished to Triple-A true, correct and complete copies of each
Facility Document to which the Seller is a party, each of which is in full force
and effect. Neither the Seller nor any Affiliate thereof is in default of any of
its obligations thereunder in any material respect. Upon the Purchase of each
Receivable pursuant to the Purchase Agreement, the Seller shall be the lawful
owner of, and have good title to, such Receivable and all Transferred Assets
relating thereto, free and clear of any Adverse Claims. All such Transferred
Assets are purchased without recourse to the Originator except as described in
the Purchase Agreement. The Purchases of the Transferred Assets by the Seller
constitute valid and true sales and transfers for consideration (and not merely
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a pledge of such Transferred Assets for security purposes), enforceable against
creditors of the Originator and no Transferred Assets shall constitute property
of the Originator.
(q) BUSINESS. Since its incorporation, the Seller has conducted no
business other than the execution, delivery and performance of the Facility
Documents contemplated hereby, the purchase and servicing of Transferred Assets
thereunder, and such other activities as are incidental to the foregoing. The
Seller has incurred no Indebtedness except that expressly incurred hereunder and
under the other Facility Documents.
(r) OWNERSHIP OF THE SELLER. One hundred percent (100%) of the
outstanding capital stock of the Seller is directly owned (both beneficially and
of record) by HPSC, Inc. Such stock is validly issued, fully paid and
nonassessable and there are no options, warrants or other rights to acquire
capital stock from the Seller.
(s) TAXES. The Seller has filed or caused to be filed all Federal,
state and local tax returns which are required to be filed by it, and has paid
or caused to be paid all taxes shown to be due and payable on such returns or on
any assessments received by it, other than any taxes or assessments, the
validity of which are being contested in good faith by appropriate proceedings
and with respect to which the Seller has set aside adequate reserves on its
books in accordance with GAAP and which proceedings have not given rise to any
Adverse Claim.
(t) SOLVENCY. The Seller, both prior to and after giving effect to
the initial Purchase on the initial Purchase Date, and after giving effect to
each subsequent Purchase, (i) is not "insolvent" (as such term is defined in
ss.101(31)(A) of the Bankruptcy Code); (ii) is able to pay its debts as they
become due; and (iii) does not have unreasonably small capital for the business
in which it is engaged or for any business or transaction in which it is about
to engage.
(u) DIVERSIFICATION. After giving effect to the initial Receivables
Purchase on the initial Receivables Purchase Date, the number of Contracts and
the number of Obligors associated with the Purchased Receivables shall equal or
exceed 300.
(v) AVERAGE OUTSTANDING BALANCE. After giving effect to the initial
Receivables Purchase on the initial Receivables Purchase Date, and immediately
after giving effect to each subsequent Receivables Purchase, the average
Outstanding Balance of all Purchased Receivables hereunder shall not be less
than 90% nor more than 110% of the average "Outstanding Balance" of "Pledged
Receivables" (as each term is defined in the Definitions List to the Credit
Agreement).
(x) IMPLICIT INTEREST RATE. As of the date of any Receivables
Purchase, the excess of (i) the average implicit interest rates being charged to
Obligors in respect of the Receivables then being purchased OVER (ii) the
Discount Rate applicable to such Receivables, shall not be greater than eight
percent (8.0%).
(y) SELECTION OF RECEIVABLES. Each Receivable has been randomly
selected from the Originator's portfolio of receivables in accordance with its
normal standards and procedures used for all of its standard securitization
transactions and no selection procedures
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adverse to Triple-A have been employed in such selections. In addition, (i) the
designation of a Purchased Receivable as a Designated Receivable or a
Non-Designated Receivable and (ii) the repurchase of any Designated Receivable
pursuant to Section 8.02 shall be done on a basis which is not adverse to
Triple-A or CapMAC.
(z) HISTORIC LOSS DATA. Attached hereto as EXHIBIT F is a summary of
historical static loss data suffered by the Originator as a result of
charge-offs of the Originator's receivables, which summary is true and accurate
with respect to the periods described therein and does not omit any information
necessary to make such summary not misleading.
ARTICLE V
GENERAL COVENANTS
SECTION 5.01. AFFIRMATIVE COVENANTS OF THE SELLER. From the initial
Receivables Purchase Date until the later of the Termination Date or the
Collection Date, the Seller will, unless Triple-A shall otherwise consent in
writing:
(a) COMPLIANCE WITH LAWS, ETC. Comply in all material respects with
all applicable laws, rules, regulations and orders with respect to it, its
business and properties and all Receivables and related Contracts.
(b) PRESERVATION OF CORPORATE EXISTENCE. 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 except where the failure to preserve
and maintain such existence, rights, franchises, privileges and qualifications
would not materially adversely affect (i) the collectibility of the Purchased
Assets, (ii) the collectibility of any Receivable, (iii) the business,
properties, operations, prospects, profits or condition (financial or otherwise)
condition of the Seller or (iv) the ability of the Seller to perform its
obligations hereunder and under the other Facility Documents to which it is a
party.
(c) AUDITS. At any time and from time to time upon prior written
notice to the Seller during regular business hours and on a quarterly basis if
requested, permit the Collateral Agent, or its agents or representatives, (i) to
examine and make copies of and abstracts from all Records, and (ii) to visit the
offices and properties of the Seller for the purpose of examining such Records,
and to discuss matters relating to the Receivables or the Seller's performance
hereunder with any of the officers or employees of the Seller having knowledge
of such matters. Each such audit shall be at the sole expense of the Seller
(subject to the Seller's right under the Purchase Agreement to recover such
expenses from the Originator); PROVIDED, that, so long as no Wind-Down Event has
occurred during any calendar year, the annual audit expenses during such year
for which the Seller is responsible hereunder and under the Credit Agreement
shall not exceed $40,000 in the aggregate.
(d) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Maintain and implement
administrative and operating procedures (including, without limitation, an
ability to recreate records evidencing the Receivables in the event of the
destruction of the originals thereof) and
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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 daily
identification of all collections of and adjustments to each Purchased
Receivable).
(e) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS. At its
expense timely and fully perform and comply, and cause the Originator to comply,
in all material respects, with all material provisions, covenants and other
promises required to be observed by it or the Originator under the Contracts.
(f) LOCATION OF RECORDS. Keep its chief place of business and chief
executive office, and the offices where it keeps the Records, at the address of
the Seller referred to in SECTION 4.01(j), or, in any such case, upon 30 days'
prior written notice to the Collateral Agent, at such other locations within the
United States where all action required by SECTION 6.04 shall have been taken
and completed.
(g) CREDIT AND COLLECTION POLICIES. Comply in all material respects
with the Credit and Collection Policy in regard to each Purchased Receivable and
the related Contract.
(h) COLLECTIONS. Instruct all Obligors to cause all Collections to be
deposited directly to a Post Office Box or Lock-Box Account and if the Seller
shall receive any Collections, the Seller shall hold such Collections in trust
for the benefit of the Collateral Agent and deposit such Collections into a
Lock-Box Account or the Collection Account within one Business Day following
Seller's receipt thereof.
(i) COMPLIANCE WITH ERISA. Comply in all material respects with the
provisions of ERISA, the IRC, and all other applicable laws, and the regulations
and interpretations thereunder.
(j) PERFECTED SECURITY INTEREST UNDER CONTRACTS. Take such action
with respect to each Purchased Receivable as is necessary to ensure that the
Seller maintains, as against the Obligor thereunder, a perfected security
interest in any Equipment relating thereto free and clear of Adverse Claims or,
in the case of any Lease, to ensure that the Seller would maintain such a
perfected priority security interest in the event that a court or other Person
were to determine that such Lease purported to transfer to the Obligor an
ownership (rather than a leasehold) interest in the Equipment subject thereto;
PROVIDED, that the Seller shall not be required to file financing statements or
to maintain the effectiveness of previously filed financing statements with
respect to any Eligible Receivables the Outstanding Balance of which originally
is or has thereafter been reduced below $5,000, respectively, so long as the
aggregate Outstanding Balance of Receivables hereunder for which no such
financing statements are in effect at any time remains less than 7.5% of the
Discounted Eligible Receivables Balance hereunder; provided that such seven and
one-half percent limitation shall not apply from and after the Termination Date
unless and to the extent that the Collateral Agent specifically requests
otherwise.
(k) MAINTENANCE OF INSURANCE. Maintain, or cause the Originator or
each Obligor to maintain, with respect to the Contracts and the Equipment
related thereto, casualty
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and general liability insurance which provide at least the same coverage as a
fire and extended coverage insurance policy as is comparable for other companies
in related businesses. Such insurance policies (and self-insurance where
permitted) shall be maintained in an amount which is not less than the aggregate
Discounted Value of the Purchased Receivables hereunder arising under the
relevant Contracts hereunder. Each such casualty and liability policy if
maintained by an Obligor, shall name the Originator or the Seller as loss payee
and additional insured, and the Originator shall have assigned any such interest
to the Seller. The Seller shall remit, or shall cause to be remitted, the
proceeds of any such insurance policy to a Lock-Box Account or the Collection
Account.
(l) SEPARATE IDENTITY. Take all actions required to maintain the
Seller's status as a separate legal entity. Without limiting the foregoing, the
Seller shall:
(i) conduct all of its business, and make all communications to third
parties (including all invoices (if any), letters, checks and other
instruments) solely in its own name (and not as a division of any other
Person), and require that its employees, if any, when conducting its
business identify themselves as such and not as employees of any other
Affiliate of the Seller (including, without limitation, by means of
providing appropriate employees with business or identification cards
identifying such employees as the Seller's employees);
(ii) compensate all employees, consultants and agents directly or
indirectly through reimbursement of the Originator each calendar quarter,
from the Seller's bank accounts, for services provided to the Seller by
such employees, consultants and agents and, to the extent any employee,
consultant or agent of the Seller is also an employee, consultant or agent
of any Affiliate of the Seller, allocate the compensation of such employee,
consultant or agent between the Seller and such Affiliate on a basis which
reflects the services rendered to the Seller and such Affiliate;
(iii) pay its own operating expenses and liabilities from its own
funds, allocate all overhead expenses (including, without limitation,
telephone and other utility charges) for items shared between the Seller
and any Affiliate 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 and allocate taxes on the basis of their respective
incomes in accordance with applicable federal regulations;
(iv) at all times have at least one "Independent Director", as defined
in and as required under the Seller's Certificate of Incorporation and have
at least one officer responsible for managing its day-to-day business and
manage such business by or under the direction of its board of directors;
(v) maintain its books and records separate from those of any
Affiliate;
(vi) prepare its financial statements separately from those of its
other Affiliates and insure that any consolidated financial statements of
the Originator have notes to the effect that the Seller is a separate
corporate entity whose creditors have a claim on its
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assets prior to those assets becoming available to its equity holders and
therefore to any creditors of the Originator;
(vii) use its best efforts not to commingle its funds or other assets
with those of any other Affiliate, and not to hold its assets in any manner
that would create an appearance that such assets belong to any other
Affiliate, and not maintain bank accounts or other depository accounts to
which any Affiliate is an account party, into which any Affiliate makes
deposits or from which any Affiliate has the power to make withdrawals;
(viii) not permit any Affiliate to pay its operating expenses (except
pursuant to allocation arrangements that comply with the requirements of
SUBSECTION (II) or (III) of this SECTION 5.01(l) or pursuant to the terms
of the Purchase Agreement);
(ix) not guarantee any obligation of any Affiliate nor (to the extent
that the Seller has the legal power to prevent such) have any of its
obligations guaranteed by any such Affiliate, (either directly or by
seeking credit based on the assets of such Affiliate) or otherwise hold
itself out as responsible for the debts of any Affiliate;
(x) maintain at all times stationery and a telephone number separate
from that of any Affiliate and which telephone number will be answered in
its own name, and have all its officers and employees conduct all of its
business solely in its own name;
(xi) hold regular meetings of its board of directors in accordance
with the provisions of its Certificate of Incorporation and otherwise take
such actions as are necessary on its part to ensure that all corporate
procedures required by its Certificate of Incorporation and by-laws are
duly and validly taken;
(xii) maintain a separate office from the offices of any of its
Affiliates and identify such office by a sign in its own name;
(xiii) pay dividends only if (A) no other dividend has been paid
during the calendar month in which such dividend is paid, (B) such dividend
has been duly authorized by its board of directors in accordance with
applicable law and (C) its net worth, determined immediately after giving
effect to such dividend is at least $2,000,000; and
(xiv) take such other actions as are necessary on its part to ensure
that the facts and assumptions set forth in the opinion described in
SECTION 3.01(x) remain true and correct at all times.
(m) TAXES. File or cause to be filed, and (to the extent it has legal
power to cause such) cause each of its Affiliates with whom it shares
consolidated tax liability to file, all federal, state and local tax returns
which are required to be filed by it, except where the failure to file such
returns could not reasonably be expected to have a material adverse effect on
the collectibility of the Transferred Assets or the ability of the Seller to
perform its obligations hereunder or under any other Facility Document to which
it is a party or which could otherwise
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be reasonably expected to expose the Seller to a material liability. The Seller
shall pay or cause to be paid all taxes shown to be due and payable on such
returns or on any assessments received by it, other than any taxes or
assessments, the validity of which are being contested in good faith by
appropriate proceedings and with respect to which the Seller or the applicable
subsidiary shall have set aside adequate reserves on its books in accordance
with GAAP and which proceedings could not reasonably be expected to have a
material adverse effect on the collectibility of the Transferred Assets or the
ability of the Seller to perform its obligations hereunder or under any other
Facility Document to which it is a party or which could otherwise be reasonably
expected to expose the Seller to a material liability.
(n) INTEREST RATE XXXXXX. Concurrently with each Receivables
Purchase, enter into an Interest Rate Hedge with the Swap Provider as
contemplated in the definition of "Discount Rate", and transfer, assign and
otherwise convey to the Collateral Agent all of the Seller's rights in, to and
under such Interest Rate Hedge pursuant to an Interest Rate Hedge Assignment in
substantially in the form of EXHIBIT E hereto, together with a certificate
executed by the Swap Provider in substantially the form of Exhibit A to such
Interest Rate Hedge Assignment. The Seller shall thereafter maintain such
Interest Rate Xxxxxx in full force and effect at all times until the Capital
associated with such Receivables Purchase has been recovered in full by
Triple-A, in a notional amount equal to no less than 96% and no more than 105%
of the sum of the outstanding Capital plus the principal amount of all "Triple-A
Loans" (as defined in the Credit Agreement) related thereto and based on an
amortization schedule which matches the amortization of the aggregate
Receivables then outstanding and the terms of which are otherwise reasonably
satisfactory to the Collateral Agent. The Seller acknowledges that Triple-A
and/or the Surety on behalf of Triple-A have guaranteed the Seller's performance
of its obligations under the Interest Rate Xxxxxx. The Seller shall perform all
of its obligations under the Interest Rate Xxxxxx to the same extent as if its
rights under the Interest Rate Xxxxxx has not been assigned hereunder and shall
indemnify each of Triple-A and the Surety against any payments by either such
party on account of the Seller's failure to perform its obligations under the
Interest Rate Xxxxxx, including, without limitation, any payments by the Surety
under the Swap Bond, which indemnity shall survive any termination of this
Triple-A Purchase Agreement or the Credit Agreement. The exercise by the
Collateral Agent of any of its rights hereunder or under the Interest Rate Hedge
Assignment shall not relieve the Seller from such obligations.
(o) FACILITY DOCUMENTS. Comply in all material respects with the
terms of and employ the procedures outlined in and enforce the obligations of
the Originator under the Purchase Agreement, and all of the other Facility
Documents to which it is a party, take all such action to such end as may be
from time to time reasonably requested by the Collateral Agent, maintain all
such Facility Documents in full force and effect and make to the Originator such
reasonable demands and requests for information and reports or for action as the
Seller is entitled to make thereunder and as may be from time to time reasonably
requested by the Collateral Agent.
(p) SEGREGATION OF COLLECTIONS. Prevent the deposit into any of the
Lock-Box Accounts of any funds other than Collections in respect of the
Transferred Assets and, to the extent that any such funds are nevertheless
deposited into any of such Lock-Box Accounts,
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promptly identify any such funds to the Servicer for segregation and remittance
to the owner thereof.
SECTION 5.02. REPORTING REQUIREMENTS OF THE SELLER. From the initial
Receivables Purchase Date until the later of the Termination Date or the
Collection Date, the Seller will, unless the Collateral Agent shall otherwise
consent in writing, furnish to the Collateral Agent and to CapMAC:
(a) as soon as available and in any event within 45 days after the
end of each of the first three quarters of each fiscal year of the Seller,
balance sheets of the Seller as of the end of such quarter, and (to the extent
available) statements of income and retained earnings of the Seller for the
period commencing at the end of the previous fiscal year and ending with the end
of such quarter, certified by the chief financial officer, chief accounting
officer or treasurer of the Seller;
(b) as soon as available and in any event within 105 days after the
end of each fiscal year of the Seller, a copy of the balance sheet of the Seller
as of the end of such year and the related statements of income and retained
earnings of the Seller for such year each reported on by nationally recognized
independent public accountants acceptable to the Collateral Agent (the
Collateral Agent acknowledges that any of the "Big 5" accounting firms will be
acceptable to the Collateral Agent);
(c) promptly upon receipt thereof, copies of (i) all annual and
quarterly financial statements delivered to the Seller by the Originator
pursuant to the Purchase Agreement and (ii) all other reports and other written
information not specified above which are required to be delivered by the
Originator (individually, or as Servicer) to the Seller pursuant to the terms of
the Purchase Agreement;
(d) as soon as possible and in any event within five Business Days
after the occurrence of each Event of Termination or Wind-Down Event or each
Unmatured Event of Termination or Unmatured Wind-Down Event, the statement of
the chief financial officer, chief accounting officer or treasurer of the Seller
setting forth details of such Event of Termination, Wind-Down Event, Unmatured
Event of Termination or Unmatured Wind-Down Event and the action which the
Seller proposes to take with respect thereto;
(e) promptly after the filing or receiving thereof, copies of all
reports and notices with respect to any Reportable Event defined in Article IV
of ERISA which the Seller or any Affiliate files under ERISA with the IRS or the
PBGC or the DOL or which the Seller receives from the PBGC;
(f) on or before the 15th day of each month (or if such day is not a
Business Day, the immediately succeeding Business Day), a copy of the Settlement
Report for the most recent calendar month, which shall include a summary of the
portfolio of Interest Rate Xxxxxx as of such day; and
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(g) promptly, from time to time, such other information, documents,
records or reports respecting the Purchased Receivables or the conditions or
operations, financial or otherwise, of the Seller as the Collateral Agent may
from time to time reasonably request in order to protect the interests of the
Collateral Agent or of Triple-A under or as contemplated by this Triple-A
Purchase Agreement.
SECTION 5.03. NEGATIVE COVENANTS OF THE SELLER. From the initial
Receivables Purchase Date until the later of the Termination Date or the
Collection Date, the Seller will not, without the written consent of the
Collateral Agent:
(a) SALES, LIENS, ETC. AGAINST RECEIVABLES AND RELATED SECURITY.
Except as otherwise provided herein, sell, assign (by operation of law or
otherwise) or otherwise dispose of, or create or suffer to exist, any Adverse
Claim upon or with respect to, any Purchased Receivable, Related Security,
Collections, or any related Contract, or upon or with respect to any Lock-Box
Account to which any Collections of any Purchased Receivable are sent, or assign
any right to receive income in respect thereof, or upon any other Transferred
Asset, except (i) Adverse Claims created under the Credit Agreement, and (ii)
that the Seller shall have no responsibility for any Adverse Claim created by an
Obligor upon or with respect to any Equipment owned by such Obligor so long as
such Adverse Claim is subordinate to the security interest of the Seller in such
Equipment.
(b) EXTENSION OR AMENDMENT OF RECEIVABLES. Except for actions of the
Servicer otherwise permitted hereunder and in the Purchase Agreement, extend,
amend or otherwise modify, the terms of any Receivable, or amend, modify or
waive, any term or condition of any Contract related thereto, whether for any
reason relating to a negative change in the related Obligor's creditworthiness
or inability to make any payment under the related Contract or otherwise.
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. Make any
change in the character of its business or in the Credit and Collection Policy,
which change would, in either case, impair the collectibility of any Transferred
Asset.
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS. Add or terminate any
bank as a Lock-Box Bank from those listed in EXHIBIT I to the Purchase Agreement
or make any change in its instructions to Obligors regarding payments to be made
to the Seller or payments to be made to any Lock-Box Bank, unless the Collateral
Agent shall have received (i) ten Business Days' prior notice of such addition,
termination or change and (ii) prior to the effective date of such addition,
termination or change, (x) executed copies of Lock-Box Agreements executed by
each new Lock-Box Bank and the Seller and (y) copies of all agreements and
documents signed by either the Seller or the respective Lock-Box Bank with
respect to any new Lock-Box Account.
(e) STOCK, MERGER, CONSOLIDATION, ETC. Sell any shares of any class
of its capital stock to any Person (other than the Originator) or consolidate
with or merge into or with any other corporation, or purchase or otherwise
acquire all or substantially all of the assets or capital stock, or other
ownership interest of, any Person or sell, transfer, lease or otherwise dispose
of all or substantially all of its assets to any Person, except for the
conveyances of a
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security interest in favor of the Collateral Agent as expressly permitted under
the terms of this Triple-A Purchase Agreement and the Credit Agreement.
(f) CHANGE IN CORPORATE NAME. Make any change to its corporate name
or use any trade names, fictitious names, assumed names or "doing business as"
names.
(g) ERISA MATTERS. (i) Engage or permit any ERISA Affiliate to engage
in any prohibited transaction for which an exemption is not available or has not
previously been obtained from the DOL; (ii) permit to exist any accumulated
funding deficiency, as defined in Section 302(a) of ERISA and Section 412(a) of
the IRC, or funding deficiency with respect to any Benefit Plan other than a
Multiemployer Plan; (iii) fail to make any payments to any Multiemployer Plan
that the Seller or any ERISA Affiliate may be required to make under the
agreement relating to such Multiemployer Plan or any law pertaining thereto;
(iv) terminate any Benefit Plan so as to result in any liability; or (v) permit
to exist any occurrence of any reportable event described in Title IV of ERISA
which represents a material risk of a liability of the Seller or any ERISA
Affiliate under ERISA or the IRC; PROVIDED, HOWEVER, the Seller's ERISA
Affiliates may take or allow such prohibited transactions, accumulated funding
deficiencies, payments, terminations and reportable events described in clauses
(i) through (iv) above so long as such events occurring within any fiscal year
of the Seller, in the aggregate, involve a payment of money by or an incurrence
of liability of any such ERISA Affiliate in an amount which does not exceed
$500,000.
(h) TERMINATE OR REJECT CONTRACTS. Without limiting SECTION 5.03(b),
terminate or reject any Contract prior to the term of such Contract, whether
such rejection or early termination is made pursuant to an equitable cause,
statute, regulation, judicial proceeding or other applicable law (including,
without limitation, Section 365 of the Bankruptcy Code), unless prior to such
termination or rejection, the Seller pays the Collateral Agent, for the benefit
of Triple-A, an amount equal to the Termination Amount owed with respect
thereto.
(i) INDEBTEDNESS. Create, incur, assume or suffer to exist any
Indebtedness except for (i) Indebtedness to Triple-A, the Collateral Agent or
any Liquidity Bank expressly contemplated hereunder or under the Credit
Agreement, (ii) ordinary course expenses (to the extent, if any, that such
ordinary course expenses constitute Indebtedness) in an aggregate amount
outstanding at any time not to exceed $10,000 (exclusive of taxes) and (iii)
Indebtedness to the Originator pursuant to the Purchase Agreement.
(j) GUARANTEES. Guarantee, endorse or otherwise be or become
contingently liable (including by agreement to maintain balance sheet tests) in
connection with the obligations of any other Person, except endorsements of
negotiable instruments for collection in the ordinary course of business and
reimbursement or indemnification obligations in favor of Triple-A, the
Collateral Agent, or any Liquidity Bank as provided for under this Triple-A
Purchase Agreement or under the Credit Agreement.
(k) LIMITATION ON TRANSACTIONS WITH AFFILIATES. Enter into, or be a
party to any transaction with any Affiliate, except for:
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(i) the transactions contemplated by the Purchase Agreement;
(ii) transactions related to the allocation of shared overhead
expenses or taxes as described in clause (iii) of SECTION 5.01(l); and
(iii) to the extent not otherwise prohibited under this Triple-A
Purchase Agreement, other transactions in the nature of employment
contracts and directors' fees, upon fair and reasonable terms materially no
less favorable to the Seller than would be obtained in a comparable
arm's-length transaction with a Person not an Affiliate.
(l) FACILITY DOCUMENTS. Except as otherwise permitted under SECTION
9.01, (a) terminate, amend or otherwise modify any Facility Document to which it
is a party, or grant any waiver or consent thereunder, (b) without the prior
consent of the Collateral Agent, exercise any discretionary rights granted to
the Seller under the Purchase Agreement pursuant to provisions thereof providing
for certain actions to be taken "with the consent of the Buyer", "acceptable to
the Buyer" as "specified by the Buyer", "in the reasonable judgment of the
Buyer" or similar provisions (it being understood that inaction by the Seller
shall not be considered to be an exercise of such discretionary rights) or (c)
without the prior written consent of the Collateral Agent, consent to any
amendment or modification of the Credit and Collection Policy.
(m) CHARTER AND BY-LAWS. Amend or otherwise modify its Certificate of
Incorporation or By-laws in any manner which requires the consent of the
"Independent Director" (as defined in the Seller's Certificate of Incorporation)
without the prior written consent of the Collateral Agent and delivery of an
opinion of counsel that such amendment shall not alter the conclusions set forth
in the legal opinion described in SECTION 3.01(x).
(n) LINES OF BUSINESS. Conduct any business other than that described
in SECTION 4.01(q), or enter into any transaction with any Person which is not
contemplated by or incidental to the performance of its obligations under the
Facility Documents.
(o) ACCOUNTING TREATMENT. Prepare any financial statements or other
statements (including any tax filings which are not consolidated with those of
the Originator) which shall account for the transactions contemplated by the
Purchase Agreement in any manner other than as the sale of, or a capital
contribution of, the Transferred Assets by the Originator to the Seller (it
being understood that non-recognition of such transaction due to the application
of consolidated financial reporting principles under GAAP or the filing of tax
returns on a consolidated basis shall not constitute a violation of this
covenant).
(p) LIMITATION ON INVESTMENTS. Make or suffer to exist any loans or
advances to, or extend any credit to, or make any investments (by way of
transfer of property, contributions to capital, purchase of stock or securities
or evidences of indebtedness, acquisition of the business or assets, or
otherwise) in, any Affiliate or any other Person except for (i) Permitted
Investments, (ii) the purchase of Receivables and other Transferred Assets
pursuant to the terms of the Purchase Agreement and (iii) so long as the
aggregate outstanding Capital
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hereunder is less than the Capital Limit then in effect, the acceptance of
investments in exchange for Defaulted Receivables in an effort to maximize the
recoveries thereon.
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. DESIGNATION OF SERVICER. The servicing, administering
and collection of the Purchased Receivables and the other Purchased Assets shall
be conducted by the Person (the "SERVICER") designated by the Collateral Agent
from time to time in accordance with this SECTION 6.01. Until the Collateral
Agent gives notice to the Originator of the designation of a new Servicer, the
Originator is hereby designated as, and hereby agrees to perform the duties and
obligations of, the Servicer pursuant to the terms hereof. The Collateral Agent
may at any time from and after a Servicing Termination Event, or earlier upon
the written request of the Seller, designate as Servicer any other Person to
succeed the Originator or any Successor Servicer, on the condition in each case
that any such Person so designated shall agree to perform the duties and
obligations of the Servicer pursuant to the terms hereof. The Servicer may, with
the prior written consent of Triple-A and the Collateral Agent, subcontract with
any other Person for servicing, administering or collecting the Purchased
Assets, provided that the Servicer shall remain liable for the performance of
the duties and obligations of the Servicer pursuant to the terms hereof. The
Servicer shall use reasonable care in performing its duties as Servicer
hereunder and, without limiting the foregoing, shall service the Purchased
Receivables in accordance with the Credit and Collection Policy.
SECTION 6.02. DUTIES OF THE SERVICER. (a) The Servicer shall take or
cause to be taken all such actions as may be necessary or advisable to collect
each Purchased Receivables 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. Each of the Seller, Triple-A,
the Administrative Agent and the Collateral Agent hereby appoints as its agent
the Servicer, from time to time designated pursuant to SECTION 6.01, to enforce
its respective rights and interests in and under the Purchased Receivables, the
Related Security related thereto and the related Collections. The Servicer will
at all times apply the same standards and follow the same procedures with
respect to the decision to commence, and in prosecuting and litigating with
respect to Purchased Receivables as it applies and follows with respect to
accounts, chattel paper and instruments which are not Purchased Receivables. In
no event shall the Servicer be entitled to make the Collateral Agent, Triple-A
or the Administrative Agent a party to any litigation without the Collateral
Agent's, Triple-A's and the Administrative Agent's express prior written
consent. The Servicer shall segregate and set aside for the account of Triple-A
all Collections of the Purchased Receivables and Related Security in accordance
with SECTION 2.05 of the Purchase Agreement and SECTION 6.06 hereof and shall
cause all such Collections to be remitted to a Lock-Box Account and/or deposited
directly into the Collection Account within one Business Day after
identification thereof by the Servicer and in any event within four Business
Days after the Servicer's receipt thereof. The Servicer shall promptly review
all checks and other instruments returned to it by the Lock-Box Bank on account
of restrictive endorsements, improper payees, incorrect amounts or for any other
reason and shall not deposit any such checks or instruments in
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its own accounts unless it is determined to the Collateral Agent's satisfaction
that such amounts do not constitute Collections; any such checks or instruments
which are determined to be Collections of the Purchased Receivables or Related
Security related thereto shall be promptly remitted to the Lock-Box Account or
the Collection Account as provided above. Provided that the Termination Date
shall not have occurred, the Originator, while it is Servicer, may, in
accordance with the Credit and Collection Policy, (i) amend, modify or waive any
term or condition of any Contract to reflect any Permitted Extension, (ii)
adjust the Outstanding Balance of any Purchased Receivable to reflect the
reductions, adjustments or cancellations described in the first sentence of
SECTION 2.04(d) of this Triple-A Purchase Agreement, (iii) so long as such
prepayment would not cause a Wind-Down Event under this Triple-A Purchase
Agreement or a "Wind-Down Event" under the Credit Agreement, and subject to the
payment of the Termination Amount, consent to the prepayment or early
termination of a Contract, and (iv) amend, modify or waive any provision of a
Delinquent Receivable or Defaulted Receivable so as to maximize the
collectibility thereof. The Servicer shall hold in trust for the Seller and
Triple-A in accordance with their respective interests, all Records.
Notwithstanding anything to the contrary contained herein, following the
occurrence of an Event of Termination, the Collateral Agent shall have the
absolute and unlimited right to direct the Servicer (whether the Servicer is the
Originator or otherwise) to commence or settle any legal action to enforce
collection of any Receivable or other Transferred Asset or to foreclose upon or
repossess any Related Security.
(b) The Servicer shall, as soon as practicable following receipt,
turn over (i) to the "Collateral Agent" under the Credit Agreement the
collections of any Transferred Asset which is not a Purchased Asset, and (ii) to
the Originator the collections of any receivable which is not a Transferred
Asset, in either case less, in the event the Originator is not the Servicer, all
reasonable and appropriate out-of-pocket costs and expenses of such Servicer of
servicing, collecting and administering such receivable.
(c) Notwithstanding anything to the contrary contained in this
Agreement, the Servicer, if the Collateral Agent or its designee, shall have no
obligation to collect, enforce or take any other action described in this
ARTICLE VI with respect to any receivable that is not a Purchased Receivable
other than to deliver to the Seller the Collections and documents with respect
to any such receivable as described in the first two sentences of SECTION
6.02(b) and to exercise the same degree of care with respect to Collections and
documents in its possession as it would exercise with respect to its own
property.
(d) In the event the Servicer accepts in payment of any Purchased
Receivable the taking of repossession of the Equipment the sale or lease of
which gave rise to such Purchased Receivable, the Servicer agrees to use its
reasonable efforts to resell or re-lease such Equipment for the account of
Triple-A and shall remit to the Collateral Agent the gross sale proceeds thereof
or, to the extent such Equipment is re-leased, shall deliver to the Collateral
Agent the chattel paper or other documents evidencing the rights to payment
arising from such re-lease, all of which documents shall constitute Contracts
and which rights to payment shall constitute Purchased Receivables, and all of
which Contracts and Purchased Receivables shall constitute part of the Purchased
Assets. Neither Triple-A nor the Collateral Agent shall have any obligation to
take any action or commence any proceedings to realize upon any Purchased
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Receivable or to enforce any of its rights or remedies with respect thereto. Any
moneys collected by the Servicer pursuant to this SUBSECTION 6.02(D) shall be
segregated by the Servicer, held in trust by the Servicer for Triple-A and shall
be remitted to a Lock-Box Account or to the Collection Account within one
Business Day after identification thereof by the Servicer and in any event
within four Business Days after the Servicer's receipt thereof.
(e) The Servicer shall maintain all books of account and other
records pertaining to the Purchased Receivables and the other Purchased Assets
in such form as will enable Triple-A or its designees to determine at any time
the status thereof. The Servicer will permit Triple-A, the Collateral Agent and
any Person designated by Triple-A or the Collateral Agent, during regular
business hours, to inspect, audit, check and make abstracts from all books,
accounts, records, or other papers pertaining to such Purchased Assets. From
time to time, at the request of Triple-A or the Collateral Agent, the Servicer,
at its own expense, will (i) deliver to Triple-A and the Collateral Agent and
any Person designated by Triple-A or the Collateral Agent any records and
invoices pertaining to the Purchased Assets and evidence thereof as Triple-A,
the Collateral Agent or such designee may deem necessary to enable it to enforce
its rights thereunder and (ii) xxxx each computer record relating to, and each
invoice or other evidence of, the Purchased Assets (whether or not such computer
record or other item is the property of Triple-A) as Triple-A or the Collateral
Agent may direct to reflect the interests of Triple-A and the Collateral Agent
in such Purchased Assets. The Servicer will either (i) segregate, from all the
documents relating to other receivables then owned or being serviced by the
Servicer, all documents relating to the Purchased Assets or (ii) xxxx all such
documents relating to the Purchased Assets so as to make such documents readily
identifiable as property of Triple-A and with such legend as shall be specified
by the Collateral Agent, and will, in either such event, hold all such documents
in trust for Triple-A and safely keep such documents in filing cabinets or other
suitable containers marked to show Triple-A's interest.
SECTION 6.03. RIGHTS OF THE COLLATERAL AGENT. At any time:
(a) The Collateral Agent may notify the Obligors of the Purchased
Receivables, or any of them, of Triple-A's ownership interest in the
Purchased Assets and direct such Obligors, or any of them, that payment of
all amounts payable under any Purchased Receivable be made directly to
Triple-A or its designee (including, without limitation, the Collateral
Agent).
(b) The Seller shall, at the Collateral Agent's or Triple-A's request
and at the Seller's expense, give notice of Triple-A's interest in the
Purchased Assets to each Obligor (in substantially the form of the Notice
of Assignment) and direct that payments be made directly to Triple-A or its
designee (including, without limitation, the Collateral Agent).
(c) The Seller shall, at the Collateral Agent's request, assemble all
Records which the Collateral Agent reasonably believes are necessary or
appropriate for the administration and enforcement of the Purchased Assets,
and
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shall make the same available to the Collateral Agent at a place selected
by the Collateral Agent or its designee.
(d) Each of the Seller and Triple-A hereby authorize the Collateral
Agent to take any and all steps in the Seller's name and on behalf of the
Seller necessary or desirable, in the determination of the Collateral
Agent, to collect all amounts due under any and all Purchased Receivables
or Related Security related thereto, including, without limitation,
endorsing the Seller's name on checks and other instruments representing
Collections and enforcing such Purchased Receivables and the related
Contracts.
SECTION 6.04. FURTHER ACTION EVIDENCING TRANSFERS. (a) The Seller
agrees that from time to time, at its expense, it will promptly execute and
deliver all further instruments and documents, and take all further action that
Triple-A may reasonably request in order to protect or more fully evidence
Triple-A's ownership interest in the Purchased Receivables, the Related Security
and the Collections related thereto, or to enable Triple-A to exercise or
enforce any of its rights hereunder or under any related document. Without
limiting the generality of the foregoing, the Seller will xxxx its master data
processing records evidencing such Purchased Receivables, Related Security and
Collections related thereto with a legend, acceptable to Triple-A, evidencing
that Triple-A has acquired an ownership interest therein as provided in this
Agreement and, upon the request of Triple-A, will execute and file such
financing or continuation statements, or amendments thereto or assignments
thereof, and such other instruments or notices, as may be necessary or
appropriate or as Triple-A may reasonably request. The Seller hereby authorizes
Triple-A to file one or more financing or continuation statements, and
amendments thereto and assignments thereof, relative to all or any of the
Purchased Receivables, Related Security and Collections related thereto now
existing or hereafter arising without the signature of the Seller where
permitted by law. A carbon, photographic or other reproduction of this Agreement
or any financing statement covering the Purchased Receivables, Related Security
and Collections related thereto, or any part thereof, shall be sufficient as a
financing statement. If the Seller fails to perform any of its agreements or
obligations under this Agreement, Triple-A may (but shall not be required to)
itself perform, or cause performance of, such agreement or obligation, and the
expenses of Triple-A incurred in connection therewith shall be payable by the
Seller upon Triple-A's demand therefor; PROVIDED, HOWEVER, prior to taking any
such action, Triple-A shall give notice of such intention to the Seller and
provide the Seller with a reasonable opportunity to take such action itself.
(b) The Seller shall, on or prior to the date of each Receivables
Purchase hereunder, deliver or cause to be delivered the related Contract File
to the Custodian, in suitable form for transfer by delivery, or accompanied by
duly executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to Triple-A. In the event that the Seller or the Servicer
receives any other instrument or any writing constituting chattel paper which,
in either event, evidences a Purchased Receivable or other Purchased Assets, the
Seller or the Servicer as applicable shall deliver such instrument or chattel
paper to the Custodian on behalf of Triple-A within three (3) Business Days
after receipt, in suitable form for transfer by
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delivery, or accompanied by duly executed instruments of transfer or assignment
in blank, all in form and substance satisfactory to Triple-A.
SECTION 6.05. RESPONSIBILITIES OF THE SELLER. Anything herein to the
contrary notwithstanding, the Seller shall (i) perform all of its obligations
under the Contracts to the same extent as if such Contracts had not been
transferred to Triple-A hereunder and the exercise by Triple-A or its assigns of
their respective rights hereunder shall not relieve Seller from such obligations
and (ii) pay when due any taxes, including without limitation, sales, excise and
personal property taxes payable in connection with the Purchased Assets, unless
the Seller is contesting the payment of such taxes in good faith and by
appropriate proceedings and with respect to which no Adverse Claim has been
asserted or filed.
SECTION 6.06. ADMINISTRATION OF COLLECTIONS BY SERVICER. (a) The
Servicer shall identify on a timely basis all Collections which are on account
of the Purchased Assets, including all deposits to Lock Box Accounts. On each
Business Day, all Collections received in the Lock Box Accounts for the prior
Business Day (and such Business Day, if practicable) shall be transferred to the
Collection Account. If the Servicer receives any cash or checks, drafts, wire
transfers or other instruments for the payment of money on account or otherwise
in respect of the Purchased Assets, the Servicer shall segregate such cash and
other items, hold such cash and other items in trust for the benefit of Triple-A
and the Collateral Agent and shall cause such cash and other items (properly
endorsed, where required, so that such items may be collected by Triple-A) to be
deposited in a Lock Box Account or directly in the Collection Account
immediately after the date any such cash or other item shall have been
identified as being on account of a Purchased Assets.
SECTION 6.07. APPLICATION OF COLLECTIONS. All Collections on account
of the Purchased Receivables of each Obligor shall be applied in the order of
maturity thereof unless specifically identified otherwise in writing by such
Obligor or directed by a court of competent jurisdiction. Any payment by an
Obligor in respect of any indebtedness or other obligations owed by such Obligor
to the Seller or the Servicer shall, except as otherwise specified by such
Obligor or otherwise required by law, be applied as a Collection of a Receivable
of such Obligor (in the order of the age by invoice date of such Receivables,
starting with the oldest such Receivable) to the extent of any amounts then due
and payable thereunder before being applied to any other indebtedness of such
Obligor to the Seller or the Servicer. The Servicer shall not influence or
instruct any Obligor who is indebted to the Seller in respect of any
indebtedness not included in the Purchased Assets to direct that its remittances
be applied to any such indebtedness prior to being applied to the Purchased
Assets.
SECTION 6.08. SERVICING FEE. On each Settlement Date, as full
compensation for its servicing activities hereunder, the Servicer shall be
entitled to receive a fee (the "SERVICING FEE") in an amount equal to 1.0% TIMES
the Outstanding Balance of the Purchased Receivables as of the last day of the
prior calendar month TIMES a fraction, the numerator of which is the number of
actual days elapsed in such calendar month and the denominator of which equals
360, PROVIDED, THAT, if the Servicer hereunder is also the Servicer under the
Purchase Agreement, the Servicing Fee hereunder shall be deemed paid to the
extent of any payment by the Seller of the
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"Servicing Fee" specified and defined in the Purchase Agreement. Notwithstanding
the foregoing, to the extent that Advances under the Liquidity Agreement are
used to fund or maintain Borrowings or Purchases, then the Servicing Fee shall
be .75% TIMES the Outstanding Balance of the Receivables as of the last day of
the prior calendar month TIMES a fraction, the numerator of which is the number
of actual days elapsed in such calendar month and the denominator of which
equals 360. In the event that Triple-A (or the Collateral Agent) appoints a
successor Servicer, the Servicing Fee may be adjusted as required by such
successor Servicer and as agreed to by Triple-A and the Collateral Agent.
SECTION 6.09. RESIGNATION; SUCCESSOR SERVICER. (a) The obligation of
the Servicer to service the Purchased Receivables is personal to the Servicer
and the parties recognize that another Person may not be qualified to perform
such obligations. Accordingly, the Servicer's obligation to service the
Purchased Assets hereunder shall be specifically enforceable and shall be
absolute and unconditional in all circumstances, including, without limitation,
after the occurrence and during the continuation of any Event of Termination or
Servicing Termination Event hereunder; PROVIDED, HOWEVER, that a Successor
Servicer may be appointed pursuant to this SECTION 6.09.
(b) Notwithstanding the foregoing, the Servicer may resign from the
obligations and duties hereby imposed on it as Servicer upon determination that
(i) the performance of its duties hereunder is no longer permissible under any
applicable law and (ii) there is no reasonable action which the Servicer could
take to make the performance of its duties hereunder permissible under any such
applicable law. Any determination permitting the resignation of the Servicer
shall be evidenced as to clause (i) above by an opinion of counsel to such
effect delivered to Triple-A and the Collateral Agent. Except to the extent
inconsistent with any such applicable law, no such resignation shall become
effective until a Successor Servicer shall have assumed the responsibilities and
obligations of the Servicer in accordance with the remaining provisions of this
SECTION 6.09.
(c) The Collateral Agent shall, as promptly as possible after the
Servicer has given notice pursuant to SECTION 6.09(b) above or at any time after
the Collateral Agent's designation of a successor Servicer pursuant to SECTION
6.01, appoint a successor servicer (the "SUCCESSOR SERVICER") and such Successor
Servicer shall accept its appointment by a written assumption in a form
acceptable to the Collateral Agent. Upon its appointment, the Successor Servicer
shall be the successor in all respects to the Servicer with respect to servicing
functions under this Agreement shall be subject to all the responsibilities,
duties and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement or any other Facility
Documents to the Servicer shall be deemed to refer to the Successor Servicer.
The Servicer agrees to cooperate with the Successor Servicer in effecting the
transfer of its responsibilities, duties, liabilities and rights hereunder,
including, without limitation, the execution and delivery of assignments of
financing statements, the transfer to the Successor Servicer of all cash amounts
held by the Servicer or thereafter received with respect to the Purchased
Assets, the transfer of electronic records relating to the Purchased Assets in
such form as the Successor Servicer may reasonably request and the transfer of
all related Records, correspondence and other documents relating to the
Purchased Assets.
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SECTION 6.10. LOCK-BOX ACCOUNTS; COLLECTION ACCOUNT. The Seller has
established and will maintain a system of operations, accounts and instructions
to the Lock-Box Banks and will establish and maintain the Collection Account as
provided in this SECTION 6.10. Pursuant to a Lock-Box Agreement, each Lock-Box
Account shall be irrevocably instructed to wire all funds to the Collection
Account, which Collection Account shall be maintained in the name of the
Collateral Agent. Neither the Seller, nor any Person claiming by, through or
under the Seller shall have any control over the use of, or any right to
withdraw any item or amount from, any Lock-Box Account or the Collection Account
except as expressly provided in the Lock-Box Agreements. The Collateral Agent on
behalf of Triple-A is hereby irrevocably authorized and empowered, as the
Seller's attorney-in-fact, to endorse any item deposited in a lock-box or
presented for deposit in any Lock-Box Account or the Collection Account
requiring the endorsement of the Seller, which authorization is coupled with an
interest.
SECTION 6.11. COLLECTION ACCOUNT. (a) Pursuant to the Credit
Agreement, the Seller has established for the sole and exclusive benefit of the
Collateral Agent for the benefit of Triple-A, the Surety and their respective
assigns, a cash collateral account (the "COLLECTION ACCOUNT"). The Collection
Account shall be a special purpose segregated trust account maintained with Bank
of Boston but shall be under the sole dominion and control of, and in the name
of, the Collateral Agent. All funds held in the Collection Account, including
investment earnings thereon, shall be invested in Permitted Investments at the
direction of the Seller; PROVIDED, HOWEVER, that from and after the Termination
Date or otherwise upon the occurrence and during the continuance of any Event of
Termination, the Collateral Agent shall have the sole right to restrict the
maturities of any investments held in the Collection Account and to direct the
withdrawal of any such investments for the purposes of paying Capital, Yield and
any Obligations owed hereunder. The Collateral Agent shall have the sole and
exclusive right to withdraw or order a transfer of funds from the Collection
Account in accordance with the terms and provisions of this SECTION 6.11;
PROVIDED however, that the Collateral Agent agrees to turn over to the
Originator any funds which are deposited in the Collection Account and which do
not constitute Collections or other proceeds of Purchased Assets, less all
reasonable and appropriate out-of-pocket costs and expenses incurred by the
Collateral Agent in connection with such misdirected funds.
(b) All Collections and other proceeds of the Purchased Assets in the
Collection Account shall be held in trust for the benefit of Triple-A and the
Surety and, except as otherwise provided in SECTION 6.11(d) below with respect
to any Business Day from and after the Designated Termination Date, such
Collections and other proceeds shall be used solely for the following purposes
and in the following order of priority:
(i) To remit to the Seller any Collections representing sales or
other taxes or insurance payments for the purpose of satisfying the
Seller's obligations in respect of such taxes or insurance;
(ii) To pay Yield and other Carrying Costs which are then due and
payable;
(iii) To repay Capital as provided in SECTION 2.04;
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(iv) To pay any other Obligations which may be due and owing at such
time; and
(v) If such day is a Settlement Date, to be remitted to the Seller in
consideration of the Deferred Purchase Price, PROVIDED, THAT if any
"Obligations" under the Credit Agreement remain outstanding, such amounts
shall be remitted to the Collateral Agent for application in accordance
with the terms of the Credit Agreement to the extent of such Obligations;
PROVIDED, further, that such funds shall only be remitted to the Seller to
the extent that, after giving effect to such transfer of funds and such
Purchases, the amount of Capital then outstanding does not exceed the
Capital Limit then in effect.
The Seller, in making any request for funds to be withdrawn from the Collection
Account, shall certify to each of the Collateral Agent and the Collection
Account Bank that the funds will be used for one of the purposes described above
in this SECTION 6.11(b).
If, on any Business Day prior to the Designated Termination Date, the
Collections of Purchased Assets on deposit in the Collection Account and
available for withdrawal under CLAUSE (II) above are less than the amount of the
obligations described in such CLAUSE, such available funds shall be allocated in
the priority set forth in SECTION 6.11(c) below; if, on any such Business Day,
the Collections of Purchased Assets on deposit in the Collection Account and
available for withdrawal under CLAUSE (IV) above are less than the amount of the
obligations described in such CLAUSE, such available funds shall be allocated to
the Persons to whom such obligations are owed ratably according to the
respective amounts owed.
(c) On each Business Day prior to the Designated Termination Date, to
the extent that the Collections of Purchased Assets on deposit in the Collection
Account and available under CLAUSE (II) of SECTION 6.11(b) are insufficient to
pay all Carrying Costs which are then due and payable, such funds shall be
applied to the Carrying Costs in the following order of priority:
(i) To pay any accrued and unpaid Yield (either directly, by paying to
the Swap Provider amounts owed under the Interest Rate Xxxxxx or by
reimbursing Triple-A and/or the Surety for payments made by either of them
to the Swap Provider on account of amounts owed under the Interest Rate
Xxxxxx);
(ii) To pay the pro-rata portion of any accrued and unpaid fees owing
under the Fee Letter which are allocable to this Agreement;
(iii) To pay the pro-rata portion of any accrued and unpaid expenses
of the Collateral Agent which are allocable to this Agreement;
(iv) To pay any accrued and unpaid Servicing Fee; and
(v) To pay ordinary course expenses of the Seller to the extent the
same are due or past due.
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If, on any such Business Day, the Collections of Purchased Assets on deposit in
the Collection Account and available for withdrawal under either CLAUSE (II) or
(V) above are less than the amount of the obligations described in such CLAUSE,
such available funds shall be allocated to the Persons to whom such obligations
are owed ratably according to the respective amounts owed.
(d) On each Business Day from and after the Designated Termination
Date, Collections and other proceeds of Purchased Assets shall be withdrawn from
the Collection Account solely upon direction of the Collateral Agent to be
applied against the Obligations in the following order of priority;
(i) To remit to the Seller any Collections representing sales or other
taxes or insurance payments for the purpose of satisfying the Seller's
obligations in respect of such taxes or insurance;
(ii) To pay any accrued and unpaid Servicing Fee (if the Servicer is a
party other than the Originator or an Affiliate thereof);
(iii) To pay accrued and unpaid Yield (either directly or by paying to
the Swap Provider amounts owed under the Interest Rate Xxxxxx or by
reimbursing Triple-A and/or the Surety for payments made by either of them
to the Swap Provider on account of amounts owed under the Interest Rate
Xxxxxx);
(iv) To pay the pro-rata portion of any accrued and unpaid fees owing
under the Fee Letter which are allocable to this Agreement;
(v) To repay all outstanding Capital;
(vi) To pay the pro-rata portion of the accrued and unpaid expenses of
the Collateral Agent which are allocable to this Agreement;
(vii) To pay any other accrued and unpaid Obligations which have not
been paid pursuant to clauses (i) through (v) above;
(viii) To pay any other Carrying Costs which are due and owing but
have not been paid pursuant to clauses (i) through (vi) above; and
(ix) To pay any accrued and unpaid Servicing Fee owed to the
Originator or an Affiliate thereof.
If, on any such Business Day, the funds on deposit in the Collection Account and
available for withdrawal under either CLAUSE (iv), (vi), (vii) or (viii) above
are less than the amount of the obligations described in such CLAUSE, such
available funds shall be allocated to the Persons to whom such obligations are
owed ratably according to the respective amounts owed. Any funds remaining in
the Collection Account after payment of the foregoing Obligations and other fees
and expenses shall be remitted to the Seller in consideration of the Deferred
Purchase Price, PROVIDED that if any "Obligations" under the Credit Agreement
remain outstanding, such funds
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shall be remitted to the Collateral Agent for application in accordance with the
terms of the Credit Agreement to the extent of such "Obligations".
ARTICLE VII
WIND-DOWN EVENTS; REMEDIES
SECTION 7.01. WIND-DOWN EVENTS. Each of the following events shall
constitute a "WIND-DOWN EVENT" within the meaning of this Triple-A Purchase
Agreement:
(a) The occurrence of any Event of Termination under the Purchase
Agreement or any "Wind-Down Event" under the Credit Agreement;
(b) The Servicer (if the Seller or any Affiliate of the Seller) shall
fail to perform or observe any term, covenant or agreement hereunder (other than
as referred to in clause (ii) of this SECTION 7.01(b)) and such failure shall
remain unremedied for three Business Days after written notice from the
Collateral Agent or (ii) either the Servicer (if the Seller or any Affiliate of
the Seller) or the Seller shall fail to make any payment or deposit to be made
by it hereunder when due and, solely in the case of any such payments which do
not constitute payments of Capital or Yield, such failure shall remain
unremedied for three (3) Business Days after written notice from the Collateral
Agent; or
(c) The Seller shall fail to perform or observe any term, covenant or
agreement contained in SECTION 5.03 and any such failure shall remain unremedied
for five (5) Business Days after written notice from the Collateral Agent; or
(d) Any representation or warranty made or deemed to be made by the
Seller (or any of its officers) under or in connection with this Triple-A
Purchase Agreement, any Settlement Report or other information or report
delivered pursuant hereto shall prove to have been false or incorrect in any
material respect when made; PROVIDED, HOWEVER, that (i) to the extent any breach
of any such representation or warranty may be cured within ten (10) Business
Days, the Seller shall have ten (10) Business Days after learning of such breach
to make such representation and warranty true and correct and (ii) if any such
false or incorrect representation or warranty has given rise to a deemed
Collection as provided under SECTION 2.04 of this Triple-A Purchase Agreement,
then, upon the Seller's payment of such deemed Collection at the time and in the
manner required under this Triple-A Purchase Agreement, the breach of such
representation or warranty shall not give rise to a Wind-Down Event under this
subsection (d); or;
(e) The Seller shall fail to perform or observe any other term,
covenant or agreement contained in this Triple-A Purchase Agreement on its part
to be performed or observed and any such failure shall remain unremedied for ten
(10) Business Days after written notice from the Collateral Agent (it being
understood that if any such failure gives rise to a deemed Collection under
SECTION 2.04 of this Triple-A Purchase Agreement, then, the payment of such
deemed Collection at the time and in the manner required under this Triple-A
Purchase Agreement shall be deemed a remedy of such failure); or
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(f) The interest of the Collateral Agent in the Purchased Assets
shall for any reason, except to the extent permitted by the terms hereof, cease
to create a valid and perfected first priority interest in such Purchased
Assets; PROVIDED, HOWEVER, if any such failure results in a deemed Collection
under SECTION 2.04 of this Triple-A Purchase Agreement and the Seller satisfies
in full its payment obligations under such section with respect to such deemed
Collection, then such failure shall not give rise to a Wind-Down Event under
this subsection (f); or
(g) (i) An Insolvency Event shall occur with respect to the Seller or
the Originator or (ii) the Seller or the Originator shall take any corporate
action to authorize the filing of any Insolvency Proceeding; or
(h) As of the close of business on any Settlement Date, the Capital
Limit shall be less than the aggregate outstanding Capital; or
(i) The Originator shall cease to own 100% of the issued and
outstanding stock of the Seller; or
(j) There shall have occurred, since the initial Receivables Purchase
Date, a material adverse change in the financial condition of the Seller or
there shall have occurred any event which materially and adversely affects the
collectibility or the Receivables generally or the ability of the Seller to
perform hereunder; or
(k) Triple-A or the Surety shall determine that continuation of this
Triple-A Purchase Agreement without exercise of remedies under Section 7.02 will
impose a material adverse regulatory impact on Triple-A or the Surety, as the
case may be.
SECTION 7.02. REMEDIES. During the existence of a Wind-Down Event, the
Collateral Agent on behalf of Triple-A may, by written notice to the Seller,
take any or all of the following actions, at the same or different times: (i)
declare the Termination Date to have occurred; (ii) declare the Obligations to
be immediately due and payable; (iii) pursue any other remedy under this
Triple-A Purchase Agreement and the other Facility Documents and (iv) exercise
any rights and remedies of a secured party under Article 9 of the UCC, which
rights and remedies shall be cumulative to those provided for under this
Triple-A Purchase Agreement and the other Facility Documents; PROVIDED, HOWEVER,
that in the case of any event described in clause (i) of SUBSECTION 7.01(g)
above, then, automatically upon the occurrence of such event without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Seller, anything contained herein to the contrary
notwithstanding, the Termination Date shall be deemed to have occurred
automatically and any Obligations owed hereunder shall be immediately due and
payable. The rights and remedies of a secured party which may be exercised by
the Collateral Agent pursuant to clause (iv) of this SECTION 7.02 shall include,
without limitation, the right to (y) identify and engage a Successor Servicer to
act as servicer for the Receivables in the event of a Servicing Termination
Event, and (z) without notice except as specified below solicit and accept bids
for and sell the Purchased Assets or any part thereof in one or more parcels at
a public or private sale, at any exchange, broker's board or at any of the
Collateral Agent's offices or elsewhere, for cash, on credit or for future
delivery, and
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upon such other terms as the Collateral Agent may deem commercially reasonable.
The Seller agrees that, to the extent notice of sale shall be required by law,
10 Business Days' notice to the Seller of the time and place of any public sale
or the time after which any private sale is to be made shall constitute
reasonable notification and that it shall be commercially reasonable for the
Collateral Agent to sell the Purchased Assets on an as-is basis, without
representation or warranty of any kind. The Collateral Agent shall not be
obligated to make any sale of Purchased Assets regardless of notice of sale
having been given and may adjourn any public or private sale from time to time
by announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned.
ARTICLE VIII
INDEMNIFICATION; REPURCHASES
SECTION 8.01. INDEMNITIES BY THE SELLER. (a) Without limiting any
other rights which Triple-A may have hereunder or under applicable law, the
Seller hereby agrees to indemnify Triple-A and its permitted successors and
assigns (including, without limitation, Triple-A, the Collateral Agent and the
Surety) and their respective officers, directors, agents and employees (each, an
"INDEMNIFIED PARTY"), from and against any and all damages, losses, claims,
liabilities and related costs and expenses, including reasonable attorneys' fees
and disbursements (all of the foregoing being collectively referred to as
"INDEMNIFIED AMOUNTS") awarded against or incurred by any Indemnified Party
relating to or resulting from any of the following (excluding, however, (i)
Indemnified Amounts to the extent resulting from gross negligence or willful
misconduct on the part of an Indemnified Party or (ii) recourse (except with
respect to payment and performance obligations provided for in this Agreement)
for uncollectible Receivables):
(i) the transfer of any Receivable which was not, as of the
Receivables Purchase Date, an Eligible Receivable;
(ii) any representation or warranty made or deemed made by the Seller
or the Originator (or any of their respective officers) under or in
connection with the Purchase Agreement or this Triple-A Purchase Agreement,
any Settlement Report or any other information or report delivered by the
Seller or the Originator pursuant hereto, which shall have been false or
incorrect in any material respect when made or deemed made or delivered;
(iii) the failure by the Seller or the Originator (individually or as
Servicer) to comply with any term, provision or covenant contained in this
Triple-A Purchase Agreement or the Purchase Agreement (other than any
covenant contained in SECTION 5.04 of the Purchase Agreement, a breach of
which shall constitute an Event of Termination but shall not give rise to
indemnification under this SECTION 8.01), or any agreement executed in
connection with this Triple-A Purchase Agreement or the Purchase Agreement
or with any applicable law, rule or regulation with respect to any
Purchased Receivable, the related Contract, the Related Security or the
other Purchased Assets, or the nonconformity of any
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Purchased Receivable, the related Contract, the Related Security or the
other Purchased Assets with any such applicable law, rule or regulation;
(iv) the failure to vest and maintain vested in Triple-A or to
transfer to Triple-A an ownership interest in the Purchased Assets, free
and clear of any Adverse Claim (including, without limitation, free and
clear of any Permitted Lien except in favor of Triple-A or its assignees)
whether existing on the Receivables Purchase Date or at any time
thereafter;
(v) the failure to file, or any delay in filing (other than solely as
a result of the action or inaction of Triple-A), financing statements or
other similar instruments or documents under the UCC of any applicable
jurisdiction or other applicable laws against the Obligor with respect to
any Contract or Receivables which are, or are purported to be, Purchased
Assets, whether at the time of any Purchase or at any subsequent time;
(vi) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Purchased
Receivable (including, without limitation, a defense based on such
Purchased 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 or lease of the
Equipment and/or services related thereto or the furnishing or failure to
furnish such Equipment and/or services;
(vii) any failure of the Seller or the Originator, as Servicer or
otherwise, to perform its duties or obligations in accordance with the
provisions of Article VI hereof or Article VI of the Purchase Agreement;
(viii) any products liability claim or personal injury or property
damage suit or other similar or related claim or action of whatever sort
arising out of or in connection with the Equipment or any other goods,
merchandise and/or services which are the subject of any Receivable or
Contract;
(ix) the failure to pay when due any taxes, including, without
limitation, sales, excise or personal property taxes payable in connection
with the Purchased Assets;
(x) the termination, rejection or non-assumption by the Seller of any
Contract prior to the original term of such Contract, whether such
rejection, early termination or non-assumption is made pursuant to an
equitable cause, statute, regulation, judicial proceeding or other
applicable laws (including, without limitation, Section 365 of the
Bankruptcy Code);
(xi) the failure of the Seller, the Originator and the Obligors under
the Contracts to maintain casualty and liability insurance for the
Equipment related to the
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Purchased Receivables in an amount at least equal to the Discounted
Receivables Balance for such Purchased Receivables;
(xii) the failure of any Lock-Box Bank to remit any funds in the
Lock-Box Accounts as required hereunder; and
(xiii) the commingling of Collections of any Transferred Assets with
any other funds of the Seller.
Any amounts subject to the indemnification provisions of this SECTION 8.01 shall
be paid by the Seller to the applicable Indemnified Party within two Business
Days following the Indemnified Party's demand therefor.
SECTION 8.02. REPURCHASES OF DESIGNATED RECEIVABLES. The following
rights are in addition to and not in limitation of any other rights or remedies
that Triple-A or CapMAC may have hereunder.
(a) The Seller may, at any time upon not less than five Business
Days' prior written notice to the Collateral Agent, elect to repurchase any
Designated Receivable and the Purchased Assets relating thereto, which purchase
shall take place on the first Settlement Date to occur after the Collateral
Agent's receipt of such notice, for the repurchase price specified in SUBSECTION
(b) of this SECTION 8.02.
(b) In the case of a repurchase from Triple-A by the Seller of a
Purchased Asset pursuant to this SECTION 8.02, the Seller shall, on the
Settlement Date coinciding with such repurchase pay to the Collateral Agent as a
reduction of Capital an amount equal to the Outstanding Balance of the related
Designated Receivable. The proceeds of any such repurchase shall be deemed to be
Collections of such Purchased Asset received by the Seller, and the amount of
each such Collection shall be applied as provided in SECTION 2.04. The
repurchase of any Purchased Asset shall not relieve the Seller of its obligation
under SECTION 2.04(a) to pay Yield on the Capital outstanding with respect to
such Purchased Asset through the Payment Date relating to such Capital. Any such
repurchase shall be made without recourse or warranty, express or implied (other
than a representation and warranty that such Asset is free and clear of any
Adverse Claim created by or through Triple-A).
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ARTICLE IX
MISCELLANEOUS
SECTION 9.01. AMENDMENTS, ETC. No amendment to or waiver of any
provision of this Triple-A Purchase Agreement nor consent to any departure by
the Seller, shall in any event be effective unless the same shall be in writing
and signed by (i) the Collateral Agent on behalf of itself and Triple-A and the
Seller (with respect to an amendment) or (ii) the Collateral Agent on behalf of
itself and Triple-A (with respect to a waiver or consent by it) or the Seller
(with respect to a waiver or consent by it), as the case may be, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given. This Triple-A Purchase Agreement contains a
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 (together with the exhibits hereto) among the parties hereto with
respect to the subject matter hereof, superseding all prior oral or written
understandings.
SECTION 9.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in writing
(including telex communication and communication by facsimile copy) and mailed,
telexed, transmitted or delivered, as to each party hereto, at its address set
forth under its name on the signature pages hereof or at such other address as
shall be designated by such party in a written notice to the other parties
hereto. All such notices and communications shall be effective, upon receipt, or
in the case of delivery by mail, five days after being deposited in the mails,
or, in the case of notice by telex, when telexed against receipt of answer back,
or in the case of notice by facsimile copy, when verbal communication of receipt
is obtained, in each case addressed as aforesaid, except that notices and
communications pursuant to Article II shall not be effective until received.
SECTION 9.03. NO WAIVER; REMEDIES. No failure on the part of the
Collateral Agent or Triple-A 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. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
SECTION 9.04. BINDING EFFECT; ASSIGNABILITY. This Triple-A Purchase
Agreement shall be binding upon and inure to the benefit of the Seller,
Triple-A, the Collateral Agent and their respective successors and permitted
assigns (which successors of the Seller shall include a trustee in bankruptcy).
The Seller may not assign any of its rights and obligations hereunder or any
interest herein without the prior written consent of Triple-A and the Collateral
Agent. Each of Triple-A and the Collateral Agent may assign at any time its
rights and obligations hereunder and interests herein to any other Person
without the consent of the Seller. Without limiting the foregoing, the Seller
hereby acknowledges that Triple-A has agreed pursuant to the Liquidity Agreement
and certain related agreements that, subject to the restrictions set forth
therein, certain parties providing credit enhancements and/or liquidity for
Triple-A in connection with the Triple-A Purchase Agreement shall be entitled to
exercise Triple-A's rights under this Triple-A Purchase Agreement and in
addition, shall constitute third-
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party beneficiaries of this Agreement. The Seller hereby consents to the
foregoing and agrees to cooperate with any such Person electing to exercise
Triple-A's rights under this Triple-A Purchase Agreement. This Triple-A Purchase
Agreement shall create and constitute the continuing obligations of the parties
hereto in accordance with its terms, and shall remain in full force and effect
until such time, after the Termination Date, as the Collection Date shall occur;
PROVIDED, HOWEVER, that the rights and remedies with respect to any breach of
any representation and warranty made by the Seller pursuant to Article IV and
Article VIII shall be continuing and shall survive any termination of this
Triple-A Purchase Agreement.
SECTION 9.05. GOVERNING LAW; WAIVER OF JURY TRIAL. THIS TRIPLE-A
PURCHASE AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR
PERFECTION OF THE INTERESTS OF THE COLLATERAL AGENT IN THE COLLATERAL OR
REMEDIES HEREUNDER OR THEREUNDER, IN RESPECT THEREOF, ARE GOVERNED BY THE LAWS
OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK. THE SELLER HEREBY AGREES TO
THE JURISDICTION OF ANY FEDERAL COURT LOCATED WITHIN THE STATE OF NEW YORK, AND
WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL
SUCH SERVICE OF PROCESS BE MADE BY REGISTERED MAIL DIRECTED TO THE SELLER AT THE
ADDRESS SET FORTH ON THE SIGNATURE PAGE HEREOF AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN DEPOSITED IN
THE U.S. MAILS, POSTAGE PREPAID, OR, AT THE OPTION OF EITHER TRIPLE-A OR THE
COLLATERAL AGENT, BY SERVICE UPON CT CORPORATION SYSTEM, 0000 XXXXXXXX, XXX
XXXX, XXX XXXX 00000, WHICH THE SELLER HEREBY IRREVOCABLY APPOINTS AS ITS AGENT
FOR THE PURPOSE OF ACCEPTING SERVICE OF PROCESS. THE SELLER HEREBY WAIVES ANY
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE BETWEEN THE SELLER AND TRIPLE-A AND/OR THE
COLLATERAL AGENT ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO
THE RELATIONSHIP BETWEEN THEM IN CONNECTION WITH THIS TRIPLE-A PURCHASE
AGREEMENT. INSTEAD, ANY DISPUTE RESOLVED IN COURT WILL BE RESOLVED IN A BENCH
TRIAL WITHOUT A JURY. WITH RESPECT TO THE FOREGOING CONSENT TO JURISDICTION, THE
SELLER HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS, AND ANY
OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE
COURT. NOTHING IN THIS SECTION 9.05 SHALL AFFECT THE RIGHT OF TRIPLE-A OR THE
COLLATERAL AGENT TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
AFFECT THE RIGHT OF TRIPLE-A OR THE COLLATERAL AGENT TO BRING ANY ACTION OR
PROCEEDING AGAINST THE SELLER OR ITS PROPERTY IN THE COURTS OF ANY OTHER
JURISDICTION.
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SECTION 9.06. COSTS, EXPENSES AND TAXES. (a) The Seller agrees to pay
on demand all reasonable costs and expenses in connection with the preparation,
execution, delivery and administration (including periodic auditing fees as
provided for in SECTION 5.01(c) and any requested amendments, waivers or
consents) of this Triple-A Purchase Agreement and the other documents to be
delivered hereunder, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for Triple-A and the Collateral Agent with
respect thereto and with respect to advising Triple-A and the Collateral Agent
as to its rights and remedies under this Triple-A Purchase Agreement, and the
other agreements executed pursuant hereto and all costs and expenses, if any
(including reasonable counsel fees and expenses), in connection with the
enforcement of this Triple-A Purchase Agreement and the other agreements and
documents to be delivered hereunder.
(b) In addition, the Seller shall pay any and all stamp, sales,
excise and other taxes and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of this Triple-A
Purchase Agreement or the other agreements and documents to be delivered
hereunder, and agrees to indemnify the Collateral Agent, Triple-A and their
respective assignees against any liabilities with respect to or resulting from
any delay in paying or omission to pay such taxes and fees.
SECTION 9.07. EXECUTION IN COUNTERPARTS; SEVERABILITY. This Triple-A
Purchase 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. In case any provision in or
obligation under this Triple-A Purchase Agreement shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby.
SECTION 9.08. NO BANKRUPTCY PETITION AGAINST TRIPLE-A. The Seller
covenants and agrees that it will not institute against Triple-A, or join any
other Person in instituting against Triple-A, any Insolvency Proceeding under
bankruptcy law or under any similar federal or state law.
SECTION 9.09. REFERENCE TO AND EFFECT ON PRIOR LRPA AND CREDIT
AGREEMENT. Each of the parties hereto ratifies the sales, conveyances, payments,
representations, warranties, covenants and indemnities made by such party in the
Prior LRPA and Credit Agreement and agrees that such agreement is, as of the
date hereof, in full force and effect. From and after the effectiveness of the
initial Receivables Purchase under this Agreement in accordance with Section
3.01, (i) the terms and provisions of this Agreement shall amend and supersede
the terms and provisions of the Prior LRPA and the Credit Agreement in their
entirety, (ii) the continuing rights, remedies and obligations of the parties
with respect to any Receivables and other Purchased Assets acquired under the
Prior LRPA or financed under the Credit Agreement shall be governed by the terms
and provisions of this Agreement to the same extent as if such Purchased Assets
had been conveyed under this Agreement, (iii) all of Triple-A's funding
commitments under the Credit Agreement shall be terminated and (iv) all
references in any other
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Facility Documents to the Prior LRPA or Appendix A thereto shall mean and be a
reference to this Agreement and Appendix A hereto. It is expressly understood
and agreed that the execution and delivery of this Agreement is not intended to
be, and shall not be construed as, a novation of the Prior LRPA nor the Credit
Agreement nor of any liens granted or indebtedness incurred thereunder.
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IN WITNESS WHEREOF, the parties below have caused this Triple-A
Purchase Agreement to be duly executed by their duly authorized officers and
delivered as of the day and year first above written.
HPSC BRAVO FUNDING CORP., as Seller
By: ________________________________________
Title: President
Address: Sixty Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000-0000
Attn: President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
HPSC, INC., as Servicer
By: ________________________________________
Title:__________________________________
Address: Sixty Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000-0000
Attn: Vice President, Finance
Telephone:
Telecopy:
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TRIPLE-A ONE FUNDING CORPORATION
By: Capital Markets Assurance Corporation,
its Attorney-in-Fact
By:__________________________________________
Title: Vice-President
Address: 000 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Head of Exposure Management
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
CAPITAL MARKETS ASSURANCE CORPORATION
By:__________________________________________
Title: Vice-President
Address: 000 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Head of Exposure Management
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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APPENDIX A
to
TRIPLE-A PURCHASE AGREEMENT
DEFINITIONS LIST
Attached
52
DEFINITIONS LIST
TO
TRIPLE-A PURCHASE AGREEMENT
"ADVANCE" means an "Advance" funded to Triple-A under the Liquidity
Agreement.
"ADMINISTRATIVE AGENT" means CapMAC in its capacity as "Administrative
Agent" for Triple-A.
"ADVERSE CLAIM" means a lien, security interest, charge, encumbrance
or other right or claim of any Person other than Permitted Encumbrances.
"AFFILIATE" means, with respect to any Person, a Person: (i) that
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such Person; (ii) that
beneficially owns or holds 5% or more of any class of the voting stock (or, in
the case of a Person that is not a corporation, 5% or more of the equity
interest) of such Person; or (iii) 5% or more of the voting stock (or, in the
case of a Person that is not a corporation, 5% or more of the equity interest)
of which is beneficially owned or held, directly or indirectly, by such Person.
The term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting stock or an equity interest, by
contract, or otherwise.
"AFFILIATED OBLIGOR" means any Obligor which is an Affiliate of
another Obligor.
"AGREEMENT" means the Triple-A Purchase Agreement.
"AGGREGATE OUTSTANDINGS" means, on any day, an amount equal to the sum
of (i) the outstanding Capital as of such day and (ii) the outstanding principal
amount of all "Triple-A Loans" under the Credit Agreement as of such day.
"AGGREGATE RESERVES" means, on any day, an amount equal to the
Discounted Eligible Receivables Balance times the GREATEST of (i) 10%, (ii) the
Default Reserve Ratio as computed in the most recent Settlement Report and (iii)
the Excess Concentration Reserve Ratio as computed on the most recent Settlement
Date; PROVIDED, that the Aggregate Reserves shall not be less than the greatest
of (a) $1,000,000, (b) the sum of the Outstanding Balances of all Receivables
owed by the five (5) Obligors who owe the largest Outstanding Balances of
Receivables owed by any single Obligor, and (c) twenty-five percent (25%) of the
highest dollar amount of Aggregate Reserves as of any previous time.
"BANCO SANTANDER" means Banco Santander Central Hispano, a Spanish
bank, New York Branch.
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"BANK OF BOSTON" means The First National Bank of Boston, now known as
Fleet Capital Corporation, a national banking association.
"BANKRUPTCY CODE" means Title 11 of the United States Code (11 U.S.C.
Section 101 ET SEQ.), as amended from time to time, or any successor statute.
"BASE RATE" means a fluctuating interest rate per annum equal to the
higher of (i) the rate of interest published in the Wall Street Journal as the
prime rate, or, in the event that no such rate is published, the rate of
interest announced publicly by the Liquidity Agent in New York, New York, as its
prime or reference rate, whether or not such rate is the lowest rate offered by
such institution to its corporate borrowers and (ii) 1/2 of one percent per
annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance which bears interest at the Base
Rate.
"BENEFIT PLAN" means a defined benefit plan as defined in Section
3(35) of ERISA (other than a Multiemployer Plan) in respect of which the
Originator or any ERISA Affiliate is, or at any time within the immediately
preceding six (6) years was, an "employer" as defined in Section 3(5) of ERISA.
"BUSINESS DAY" means any day other than a Saturday, Sunday or public
holiday or the equivalent for banks in New York City or Boston, Massachusetts;
PROVIDED that, when used in connection with any Eurodollar Rate Advance or other
matters concerning the Eurodollar Rate, the term "Business Day" means any such
day on which dealings are carried on in the London interbank market and on which
banks are open for business in London, England.
"BUYER", when used in the Purchase Agreement or in these definitions,
means HPSC Bravo Funding Corp., a Delaware corporation.
"CAPITAL" means the original amount paid to the Seller for each
Receivables Purchase under this Triple-A Purchase Agreement pursuant to SECTIONS
2.01 and 2.02, reduced from time to time by Collections received and distributed
on account of such Capital pursuant to SECTION 2.04 hereof. If Triple-A or the
Administrative Agent is required (or believes in good faith that it is required)
by law to repay (as a preference or otherwise) to any Obligor, the Originator,
the Seller, a Lock-Box Bank, a trustee for any Obligor, the Originator or the
Seller, a court or any other Person, any amount that previously caused a
reduction in Capital, then Capital shall be reinstated by the amount of such
repayment and the Seller will indemnify and hold Triple-A or the Administrative
Agent harmless for the amount of such repayment, interest thereon required (or
believed in good faith by Triple-A or the Administrative Agent to be required)
to be paid in connection therewith and all losses, liabilities, costs and
expenses related thereto (including but not limited to reasonable attorneys'
fees and expenses).
"CAPITAL LIMIT" means, on any day, (A) the Discounted Eligible
Receivables Balance on such day MINUS (B) the Aggregate Reserves then in effect.
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"CAPMAC" means Capital Markets Assurance Corporation, a New York stock
insurance company.
"CARRYING COSTS" means, at any time, the aggregate amount of (i) all
accrued and unpaid Yield, fees, premiums and other expenses owing by the Seller
to Triple-A, the Collateral Agent, the Dealer, the Surety, the Swap Provider,
the Servicer and the Administrative Agent (including, without limitation, all
fees owed under the Fee Letter, collateral audit fees and expenses, the
Servicing Fee, the CP Dealer Fees and the Surety Bond Premium) PLUS (ii) all
ordinary course operating expenses incurred by the Seller during such calendar
month (including rent, salaries, professional fees and expenses incurred in
connection therewith).
"CARRYING COSTS PERCENTAGE" means a percentage, calculated as of the
last day of each month equal to the sum of (i) the sum of the per annum rates
used to calculate the Servicing Fee and the "Administration Fee" and "Program
Fee" described in the Fee Letter PLUS (ii) a fraction (expressed as a
percentage) the numerator of which equals Carrying Costs described in clause
(ii) of the definition thereof which were incurred during the calendar month
then ending and the denominator of which equals the sum of the average Aggregate
Outstandings during such month.
"COLLATERAL AGENT" means CapMAC, in its capacity as Collateral Agent
pursuant to the Credit Agreement and this Triple-A Purchase Agreement, and any
successor Collateral Agent.
"COLLECTION ACCOUNT" means that account defined as such in SECTION
6.11 of this Triple-A Purchase Agreement.
"COLLECTION ACCOUNT BANK" means the bank maintaining the Collection
Account.
"COLLECTION DATE" means the date following the Termination Date on
which (i) the aggregate outstanding Capital has been reduced to zero, (ii)
Triple-A has received all accrued Yield, fees and other amounts payable under
this Triple-A Purchase Agreement and the other Facility Documents (other than
the Credit Agreement) and (iii) the Surety Bonds have been discharged (other
than through payment thereunder).
"COLLECTIONS" means, with respect to any Purchased Asset or other
Receivable, as applicable, all cash collections and other cash proceeds of such
Purchased Asset or Receivable, including, without limitation, all cash proceeds
of Related Security related thereto, and in the case of any Purchased Assets,
all cash collections of any Purchased Receivables included therein, and, in
either such case, any Collection of such Purchased Asset or Receivable deemed to
have been received pursuant to SECTION 2.04 of this Triple-A Purchase Agreement
(it being understood that the Seller shall pay, or shall cause the Originator to
pay, all such deemed Collection amounts to Triple-A by depositing the amount
thereof into the Lock-Box Account).
"COMMERCIAL PAPER" means the short-term promissory notes of Triple-A
denominated in dollars, issued by Triple-A in connection with the transactions
contemplated by the Facility Documents, including any portion of such short-term
promissory notes that are
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identified on the books and records of Triple-A as issued in respect of the
transactions contemplated by the Facility Documents.
"CONTRACT" means each Lease, Finance Agreement, Leasehold Improvement
Note, Practice Finance Loan, Non-Medical Contract or other agreement or
instrument which is purported to be transferred to the Buyer under the Purchase
Agreement, whether by purchase or contribution to the Buyer's capital, as
identified on EXHIBIT A of the Purchase Agreement as such exhibit may be
supplemented from time to time in connection with any subsequent Purchase as
described in SECTION 2.02(b) of the Purchase Agreement.
"CONTRACT FILE" means, with respect to each Contract, the following
documents:
(i) The executed original counterpart of each Contract that
constitutes "chattel paper" under 9-105(1)(b) of the UCC or that
constitutes an "instrument" for purposes of 9-105(1)(i) of the UCC;
(ii) Any evidence of insurance and any other documents evidencing or
related to any insurance policy maintained by the related Obligor pursuant
to the Contract that covers physical damage to the Equipment;
(iii) If the related Contract is a Lease, copies of such documents, if
any, indicating that the Equipment was, as of the date such Contract arose,
owned by the Originator and kept on file by the Originator in accordance
with its customary procedures relating to such type of Contract, such
Obligor and such item of Equipment; and
(iv) Copies (if available) of UCC financing statements filed by the
Originator with respect to the related Equipment or, if no such copies are
available, other documentary evidence confirming the filing thereof.
"CONTRACT PAYMENT" means each periodic installment payable by an
Obligor under a Contract for rent, principal and/or interest, excluding all
supplemental or additional payments required by the terms of such Contract with
respect to sales or other taxes, insurance, maintenance, ancillary products and
services and other specific charges.
"CONTRACT PAYMENT DATE" means, with respect to any Contract, each date
on which a Contract Payment is or becomes due and payable thereunder.
"CP DEALER FEE" means, on any day, the fees payable to the Dealer in
respect of any Commercial Paper.
"CP DISRUPTION" means the inability of Triple-A, at any time, whether
as a result of a prohibition or any other event or circumstance whatsoever, to
raise funds through the issuance of its commercial paper notes (whether or not
constituting Commercial Paper as defined above) in the United States commercial
paper market.
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"CREDIT AGREEMENT" means that certain Credit Agreement, dated as of
January 31, 1995, as has been amended and as the same may be amended, restated,
supplemented, or otherwise modified from time to time, among the Borrower,
Triple-A, and CapMAC, as the Administrative Agent and the Collateral Agent.
"CREDIT AND COLLECTION POLICY" means those credit and collection
policies and practices relating to the Contracts and the Receivables described
in EXHIBIT D of the Purchase Agreement, as modified in compliance with SECTION
5.03(c).
"CUSTODIAL AGREEMENT" means that certain Custodial Agreement, dated as
January 31, 1995, as has been amended and as the same may be amended, restated,
supplemented, or otherwise modified from time to time, among Triple-A, the
Originator, the Seller, the Custodian and the Collateral Agent.
"CUSTODIAN" means Bank of Boston, in its capacity as "Custodian" under
the Custodial Agreement, or any successor thereto under the Custodial Agreement.
"DEALER" means any dealer or placement agent in respect of the
Commercial Paper.
"DEFAULT RATIO" means the ratio (expressed as a percentage), computed
as of the last day of each month by dividing (i) two TIMES the aggregate
Outstanding Balance of all Purchased Receivables that became Defaulted
Receivables or were written off the books of the Buyer as uncollectible during
the six-month period then ending by (ii) the average aggregate Outstanding
Balances of all Purchased Receivables during such six-month period.
"DEFAULT RESERVE RATIO" means the ratio (expressed as a percentage),
computed as of the last day of each month in accordance with the following
formula:
DRR = 2 X ADR X WRT, where
DRR = the Default Reserve Ratio;
ADR = the six-month rolling average of the Default Ratios for the six
most recent calendar months (including the month then ending); and
WRT = the Weighted Average Remaining Term as expressed in years of the
Purchased Receivables as of such day.
"DEFAULTED RECEIVABLE" means a Purchased Receivable at any time: (i)
as to which any Scheduled Contract Payment or part thereof is unpaid more than
180 days from its original due date, (ii) as to which the Obligor thereof has
taken any action, or suffered any event to occur, of the type described in the
definition of Insolvency Event or (iii) which, consistent with the Credit and
Collection Policy, has been or should be written off the Seller's books as
uncollectible.
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"DEFERRED PURCHASE PRICE" means, on any date, the excess if any of (i)
the aggregate Outstanding Balance of all Purchased Receivables over (ii) the sum
of aggregate outstanding Capital, accrued and unpaid Yield thereon, and any
other Carrying Costs or other amounts owed hereunder or paid under this
Agreement on behalf of the Seller including the pro-rata portion of any fees
payable under the Fee Letter to Triple-A and allocable to this Agreement, the
Administrative Agent, the Collateral Agent or any Liquidity Bank.
"DELINQUENCY RATIO" means the ratio (expressed as a percentage),
computed as of the last day of each month, by dividing (i) the aggregate
Outstanding Balance of all Purchased Receivables which became Delinquent
Receivables during the three-month period then ending, by (ii) the sum of the
aggregate Outstanding Balances of all Purchased Receivables as of each of the
last days of the fifth, fourth and third preceding calendar months (so that, for
example, the Delinquency Ratio calculated as of June 30th would have a
denominator equal to the sum of the Outstanding Balances of all Purchased
Receivables as of January 31st, February 28th, and March 31st).
"DELINQUENT RECEIVABLE" means a Purchased Receivable that is not a
Defaulted Receivable and (i) as to which any Scheduled Contract Payment or part
thereof, is unpaid more than 90 days from its original due date or (ii) which,
consistent with the Credit and Collection Policy, has been or should be
classified as delinquent by the Originator.
"DESIGNATED OBLIGOR" means, at any time, any Obligor of the Originator
whom the Collateral Agent has, following three Business Days' notice, advised
the Originator that such Obligor shall be considered a Designated Obligor.
"DESIGNATED RECEIVABLE" means a Purchased Receivable identified by the
Seller to Triple-A as a "Designated Receivable" pursuant to Section 2.02 of the
Triple-A Purchase Agreement.
"DESIGNATED TERMINATION DATE" means the date of the declaration or
automatic occurrence of the Termination Date pursuant to SECTION 7.01 of the
Purchase Agreement or SECTION 7.02 of this Triple-A Purchase Agreement.
"DILUTION FACTORS" means with respect to the Purchased Receivables,
any credits, rebates, freight charges, cash discounts, volume discounts,
cooperative advertising expenses, royalty payments, warranties, cost of parts
required to be maintained by agreement (whether express or implied), allowances,
disputes, chargebacks, returned or repossessed goods, inventory transfers,
allowances for early payments and other allowances that are made or coordinated
with the Originator's usual practices.
"DISCOUNT RATE" means (i) with respect to any Lease or Finance
Agreement pursuant to which the Buyer finances an Obligor's purchase of
Equipment, the discount rate used to calculate the aggregate Discounted Value of
the Scheduled Contract Payments payable under the related Contract as of the
last day of the month immediately preceding the month in which such Receivable
was acquired from the Originator and (ii) with respect to any other Contract,
the interest rate set forth in such Contract. The Discount Rate for such Leases
or Finance
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Agreements transferred on any date shall be a rate equal to the sum of (i) the
interest rate per annum quoted to the Seller by the Swap Provider as the rate at
which such Swap Provider is willing to enter into an Interest Rate Hedge
pursuant to which the Seller will pay an interest rate calculated in conjunction
with an Interest Rate Hedge amortization prepared by the Seller and which
complies with SECTION 5.01(n) of the Triple-A Purchase Agreement, and in return
shall receive a floating interest rate (calculated against the same principal
amount) approximately equal to the Eurodollar Rate, PLUS (ii) .15% per annum
PLUS (iii) the Carrying Costs Percentage at such time; PROVIDED, that the Seller
may, at its option, with respect to the Receivables transferred on any
Settlement Date, designate a rate which is higher than the rates calculated
above to be the "Discount Rate" for such Receivables.
"DISCOUNTED ELIGIBLE RECEIVABLES BALANCE" means, as of any date of
determination, the aggregate of the Discounted Values for all Eligible
Receivables.
"DISCOUNTED RECEIVABLES BALANCE" means, as of any date of
determination, the aggregate of the Discounted Values for all Purchased
Receivables.
"DISCOUNTED VALUE" means, (i) with respect to any Lease or Finance
Agreement pursuant to which the Buyer finances an Obligor's purchase of
Equipment, the present value of the aggregate amount of the remaining Scheduled
Contract Payments under the Contract relating thereto, with such aggregate
amount discounted to present value using the Discount Rate for such Scheduled
Contract Payments and a payment schedule of the first day of each month
commencing with the first day of the month in which the Discounted Value is
calculated and assuming that each Scheduled Contract Payment is paid on the last
Business Day of the month in which such Scheduled Contract Payment is due; it
being understood that the Discounted Value for that portion of any Receivable
which constitute payments or charges excluded from the definition of Contract
Payment or which constitute the price for a purchase option shall be zero; and
(ii) with respect to any other Contract, as of any date of determination, the
outstanding principal amount thereof.
"DOL" means the United States Department of Labor and any successor
department or agency.
"ELIGIBLE OBLIGOR" means, at any time, an Obligor who is a licensed
professional dental or medical practitioner and who (i) is not an Affiliate of
the Originator; (ii) is not the subject of any Insolvency Proceeding; (iii) is
not a Designated Obligor; (iv) is a United States resident; (v) is not the
United States of America nor any state, or other local governmental agency, or
any department, agency or instrumentality thereof and (vi) is not an Obligor of
any Defaulted Receivable; PROVIDED, HOWEVER, that an Obligor of a Non-Medical
Contract that otherwise constitutes an Eligible Receivable shall not be required
to be a licensed professional dental or medical practitioner.
"ELIGIBLE RECEIVABLE" means, at any time, a Purchased Receivable:
(i) the Obligor of which is an Eligible Obligor;
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(ii) which is not a Delinquent Receivable or a Defaulted Receivable;
(iii) which (a) if evidenced by a Practice Finance Loan, is required
pursuant to the terms thereof to be paid in full within 84 months of the
original commencement date of such Loan (or such longer period as may be
consented to by the Collateral Agent and the "Majority Liquidity Banks" (as
such term is defined in the Liquidity Agreement)), and (b) if evidenced by
a Contract other than a Practice Finance Loan, is required pursuant to the
terms thereof to be paid in full within 72 months of the original
commencement date thereof (or such longer period as may be consented to by
the Collateral Agent and the "Majority Liquidity Banks" (as such term is
defined in the Liquidity Agreement)); PROVIDED, HOWEVER, that an aggregate
amount of 30% of such Contracts that are not Practice Finance Loans and are
underlying Purchased Receivables may be allowed pursuant to the terms
thereof to be paid in full within 84 months of the original commencement
date thereof so long as each such Contract satisfies each other requirement
for an Eligible Receivable as set forth herein;
(iv) which, if arising under a Lease or Finance Agreement pursuant to
which the Buyer finances an Obligor's purchase of Equipment, arises under
such terms and conditions that the Equipment related thereto has been
installed and accepted by the related Obligor;
(v) the original Outstanding Balance of which, when added to the
Outstanding Balance of all other Receivables owing by the same Obligor at
such time, does not exceed the lesser of (i) $1,000,000 and (ii) 1.5% of
the Discounted Eligible Receivables Balance at such time;
(vi) which is either an "account" (as defined in Section 9-106 of the
UCC) or "chattel paper" (as defined in Section 9-105 of the UCC) or an
"instrument" (as defined in Section 9-105 of the UCC) as in effect in any
jurisdiction which has adopted Article 9 of the UCC and, if the Contract is
chattel paper, then there is only one counterpart of the Contract that
constitutes "chattel paper" for purposes of Section 9-105(l)(b) and 9-308
of the UCC;
(vii) which is denominated and payable only in United States dollars
in the United States;
(viii) which arises under a Contract which has been duly authorized
and which is in full force and effect and constitutes the legal, valid and
binding obligation of the Obligor enforceable against such Obligor in
accordance with its terms and is not subject (at the time each
determination of eligibility is made hereunder) to any dispute, offset or
counterclaim whatsoever;
(ix) which, together with the Contract related thereto, does not
contravene in any material respect any laws, rules or regulations
applicable thereto (including, without limitation, laws, rules and
regulations relating to truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection practices and
privacy) and
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with respect to which no party to the Contract related thereto is in
violation of any such law, rule or regulation applicable to such Contract
in any material respect;
(x) which, has not been compromised, adjusted, rewritten or otherwise
modified (including by extension of time for payment or the granting of any
discounts, allowances or credits) for any reason unless such modification
constitutes a Permitted Extension;
(xi) which (A) satisfies all applicable requirements of the Credit and
Collection Policy and (B) which is freely assignable and arises under a
Contract which is also freely assignable;
(xii) with respect to which, from and after the Receivables Purchase
thereof, Triple-A has a first priority ownership therein, free and clear of
any Adverse Claim;
(xiii) which arises under a Contract, none of the parties to which
have done or failed to do anything which would or might permit any other
party thereto to terminate such Contract or to suspend or reduce any
payments or obligations due or to become due thereunder;
(xiv) which does not constitute a "consumer lease" under the UCC;
(xv) which, if it arises under a Lease, such Lease requires the
Obligor to maintain insurance against loss or damage to the Equipment
subject to such Lease under an insurance policy which names the Buyer or
the Originator as loss payee and which interest as loss payee has been
transferred to the Buyer pursuant to the Purchase Agreement and to Triple-A
pursuant to this Triple-A Purchase Agreement;
(xvi) which arises under a Contract, no portion of which has been, or
is subject to rejection, early termination or non-assumption, prior to the
original term of such Contract except, in the case of a Practice Finance
Loan, pursuant to a provision therein requiring payment of a Termination
Amount upon any such rejection, early termination or non-assumption;
(xvii) which arises under a Contract that requires payments to be made
on a regular periodic basis and which payments, in the case of any Lease,
do not represent the payment of interim rents;
(xviii) which arises under a Contract that requires the Obligor to be
in possession of any Equipment subject thereto and does not permit the
subleasing of such Equipment to any other Person;
(xix) no portion of which is payable on account of sales taxes;
(xx) as to which the Collateral Agent has not notified the Originator
that the Collateral Agent has determined, in its reasonable discretion,
that such Receivable (or
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class of Receivables) is not acceptable for eligibility hereunder (which
notice shall state the reason(s) the Collateral Agent has elected to make
such determination);
(xxi) which was originated or acquired by the Originator in the
ordinary course of its business;
(xxii) The Discounted Value of which, (A) if arising under a Leasehold
Improvement Note, when added to the Discounted Value of all Eligible
Receivables arising under Leasehold Improvement Notes, does not exceed 25%
of the Discounted Eligible Receivables Balance, (B) if arising under a
promissory note, when added to the Discounted Value of all Eligible
Receivables arising under promissory notes, does not exceed 10% of the
Discounted Eligible Receivables Balance, and (C) if arising under either a
Leasehold Improvement Note or a promissory note, when added to the
Discounted Value of all Eligible Receivables arising under both Leasehold
Improvement Notes and promissory notes, does not exceed 30% of the
Discounted Eligible Receivables Balance;
(xxiii) the Contract for which is either (A) a Lease in substantially
the same form of EXHIBIT K-1 to the Purchase Agreement, (B) a Finance
Agreement in substantially the same form of EXHIBIT K-2 thereto, (C) a
Leasehold Improvement Note in substantially the same form of EXHIBIT K-3
thereto, (D) a Practice Finance Loan in substantially the same form of
EXHIBIT K-4 thereto, underwritten in accordance with Practice Finance Loan
underwriting criteria, as attached to EXHIBIT K-4, and which, when added to
all Practice Finance Loans, does not exceed 20% of the Discounted Eligible
Receivables Balance, (E) a Non-Medical Contract in substantially the form
of EXHIBIT K-1, EXHIBIT K-2, EXHIBIT K-3 or EXHIBIT K-4 to the Purchase
Agreement, or (F) a promissory note, the Discounted Value of which, when
added to the Discounted Value of all Eligible Receivables owed by such
Obligor and not described under (A), (B), (C), (D) or (E) above, does not
exceed $150,000; PROVIDED, that if a Contract is a Non-Medical Contract,
the Discounted Value of such Non-Medical Contract, when added together with
the Discounted Values of all other Non-Medical Contracts, does not exceed
10% of the Discounted Eligible Receivables Balance; and
(xxiv) with respect to which the Originator has filed and maintained
the effectiveness of UCC financing statements against the Obligor in order
to perfect any security interest granted under such Contract in the related
Equipment, PROVIDED that failure to maintain the effectiveness of any
financing statements for an otherwise Eligible Receivable whose Outstanding
Balance has been reduced below $5,000 shall, so long as such failure is
permitted by SECTION 5.01(j) of the Credit Agreement, not cause such
Receivable to become ineligible;
(xxv) the Contract for which was originated no earlier than December
1, 1993 and no later than the date which is one month prior to the Purchase
thereof by the Buyer and for which the Obligor has made at least one
Scheduled Contract Payment in full and in a timely manner;
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(xxvi) the Obligor of which has been notified of the Buyer's interest
as required under the Purchase Agreement;
(xxvii) with respect to which the Contract File has been delivered to
the Custodian as contemplated under the Custodial Agreement;
(xxviii) the Obligors of which are either (A) licensed dental, medical
or veterinary professionals or (B) corporations or similar entities engaged
in a dental, medical or veterinary practice, and which are licensed and/or
qualified, as appropriate, in each jurisdiction in which the nature of
their practices would require such license or qualification; PROVIDED,
HOWEVER, that an Obligor of a Receivable constituting a Non-Medical
Contract shall not be required to satisfy the conditions set forth in the
preceding clauses (A) and (B); and
(xxix) with respect to which the other representations and warranties
contained in clauses (i) (ii) (iv) and (v) of SECTION 4.01(r) of the
Purchase Agreement are true and correct in all material respects and with
respect to which all other representations and warranties contained in such
SECTION 4.01(r) are true and correct in all material respects as of the
date or dates therein made, in each such case (except for the
representations and warranties which specifically relate to the Cut-Off
Date), as if such representations and warranties were made with respect to
the Purchased Receivables only; PROVIDED, HOWEVER, that an Obligor of a
Non-Medical Contract which otherwise constitutes an Eligible Receivable
shall not be required to be a licensed professional dental or medical
practitioner.
"EQUIPMENT" means each item of equipment that is the subject of a
Contract, including all parts, accessions and modifications thereto and all
replacements thereof.
"ERISA" means the U.S. Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"ERISA AFFILIATE" means any (i) corporation which is a member of the
same controlled group of corporations (within the meaning of Section 414(b) of
the IRC) as the Originator; (ii) partnership or other trade or business (whether
or not incorporated) under common control (within the meaning of Section 414(c)
of the IRC) with the Originator or (iii) member of the same affiliated service
group (within the meaning of Section 414(m) of the IRC) as the Originator, any
corporation described in clause (i) above or any partnership or other trade or
business described in clause (ii) above.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"EURODOLLAR RATE" means for a Eurodollar Rate Advance and the relevant
Fixed Period, an interest rate per annum equal to an interest rate per annum
determined by the Liquidity Agent equal to the quotient of (i) the rate at which
it would offer deposits in United States dollars to prime banks in the London
interbank market for a period equal to such Fixed Period and in a
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principal amount of not less than $1,000,000 at or about 11:00 A.M. (London
time) on the second Business Day before (and for value on) the first day of such
Fixed Period, divided by, (ii) one minus the Eurodollar Reserve Percentage
(expressed as a decimal) applicable to the Liquidity Agent for that Fixed
Period.
"EURODOLLAR RATE ADVANCE" means an Advance which bears interest at a
rate per annum calculated by reference to the Eurodollar Rate.
"EURODOLLAR RESERVE PERCENTAGE" of any Liquidity Bank for the Fixed
Period for any Eurodollar Rate Advance means the reserve percentage applicable
during such Fixed Period (or, if more than one such percentage shall be so
applicable, the daily average of such percentages for those days in such Fixed
Period during which any such percentage shall be so applicable) under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for such Liquidity Bank with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities having
a term equal to such Fixed Period.
"EVENT OF TERMINATION" has the meaning assigned to that term in
SECTION 7.01 of the Purchase Agreement.
"EXCESS CONCENTRATION RESERVE RATIO" means, on any day, a ratio
(expressed as a percentage) calculated as of the most recent Settlement Date in
accordance with the following formula:
ECRR = (MOB/DRB * 2) + [.10(1-[MOB/DRB * 2])]; where
ECRR = the Excess Concentration Reserve Ratio;
MOB = the largest Outstanding Balance of Eligible Receivables owed by a
single Obligor; and
DRB = the Discounted Eligible Receivables Balance;
PROVIDED, however, that if MOB/DRB less and equal 1.5%, the Excess
Concentration Reserve Ratio shall be zero.
"FACILITY DOCUMENTS" means, collectively, the Purchase Agreement, the
Credit Agreement, this Triple-A Purchase Agreement, the Custodial Agreement, the
Lock-Box Agreements, the Insurance Agreement, and all other agreements,
documents and instruments delivered pursuant thereto or in connection therewith.
"FACILITY LIMIT" means, as of any date of determination, (i)
$347,500,000, as such amount may be reduced pursuant to SECTION 2.03 of the
Triple-A Purchase Agreement MINUS (ii) the aggregate principal amount of
"Triple-A Loans" outstanding on such date under the Credit Agreement.
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"FEDERAL FUNDS RATE" means, for any day, a fluctuating interest rate
per annum equal to 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 next preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day which is a Business Day, the
average of the quotations for such day for such transactions received by the
Liquidity Agent from three Federal funds brokers of recognized standing selected
by it.
"FEE LETTER" means that certain Fourth Amended and Restated Fee Letter
Agreement, dated March 31, 2000, among the Seller and CapMAC, individually, as
the Administrative Agent and the Collateral Agent, as the same may be amended,
supplemented or otherwise modified from time to time.
"FINANCE AGREEMENT" means a written finance agreement substantially in
the form of EXHIBIT K-2 to the Purchase Agreement, together with any Related
Contract Documents that may be entered into in connection with such written
finance agreement, pursuant to which the Buyer finances an Obligor's purchase of
equipment, leasehold improvements and/or working capital needs.
"FIXED PERIOD" means, with respect to any outstanding Capital, a
period selected in accordance with SECTION 2.02 and SECTION 2.07 of this
Triple-A Purchase Agreement. Such Fixed Period shall be:
(i) if such Capital is funded through the issuance of Commercial
Paper, a period of from 1 to 90 days;
(ii) if such Capital is funded through Base Rate Advances, a period of
from 1 to 30 days;
(iii) if such Capital is funded through Eurodollar Rate Advances, a
period of one, two or three months;
provided, however, that
(x) whenever the last day of a Fixed Period would otherwise occur on a
day other than a Business Day, the last day of such Fixed period shall be
extended to occur on the next succeeding Business Day, unless such
extension would cause the last day of a Fixed Period described in clause
(iii) above to occur in the next following calendar month, in which event
the last day of such Fixed Period shall be deemed to occur on the
immediately preceding Business Day;
(y) whenever a Fixed Period described in CLAUSE (iii) above commences
on the last Business Day in a month or on a date for which there is no
numerically corresponding day in the month in which such Fixed Period would
otherwise end, the last day of such Fixed Period shall occur on the last
Business Day of the month in which such Fixed Period ends; and
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(z) no Fixed Period described in CLAUSE (iii) above may end later than
the Scheduled Termination Date.
"GAAP" means generally accepted accounting principles as in effect
from time to time and applied on a basis consistent with the audited financial
statements described in SECTION 4.01(e) of the Purchase Agreement.
"INDEBTEDNESS" of any Person means (i) indebtedness of such Person for
borrowed money, (ii) obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments, (iii) obligations of such Person to pay the
deferred purchase price of property or services, (iv) obligations of such Person
as lessee under leases which shall have been or should be, in accordance with
GAAP, recorded as capital leases, (v) obligations secured by any lien or other
charge upon property or assets owned by such Person, even though such Person has
not assumed or become liable for the payment of such obligations, (vi)
obligations of such Person in connection with any letter of credit issued for
the account of such Person and (vii) obligations of such Person under direct or
indirect guaranties in respect of, and obligations (contingent or otherwise) to
purchase or otherwise acquire, or otherwise to assure a creditor against loss in
respect of, indebtedness or obligations of others of the kinds referred to in
clauses (i) through (vi) above.
"INDEMNIFIED PARTY" has the meaning assigned to such term in SECTION
8.01 of this Triple-A Purchase Agreement.
"INSOLVENCY EVENT" means with respect to any Person, any of the
following events: such Person shall generally not pay its debts as such debts
become due or shall admit in writing its inability to pay its debts generally,
or shall make a general assignment for the benefit of creditors; or any case or
proceeding shall be instituted by or against such Person seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, dissolution, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee, or other similar official for it or
for any substantial part of its property.
"INSOLVENCY PROCEEDING" means any proceeding of the sort described in
the definition of Insolvency Event.
"INSURANCE AGREEMENT" means that certain Insurance and Indemnity
Agreement, dated as of January 31, 1995, as has been amended and as the same may
be amended, restated, supplemented or otherwise modified from time to time,
among Triple-A, the Seller, the Liquidity Agent and CapMAC, as the
Administrative Agent and the Collateral Agent.
"INTEREST RATE HEDGE ASSIGNMENT" means an assignment in substantially
the form of EXHIBIT F to this Triple-A Purchase Agreement pursuant to which the
Seller assigns to the Collateral Agent all of its rights to payment under the
Interest Rate Xxxxxx.
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"INTEREST RATE XXXXXX" means interest rate swap or similar agreements
entered into by the Seller and Triple-A with the Swap Provider to provide
protection to, or minimize the impact upon, the Seller and Triple-A of
increasing interest rates under the Triple-A Purchase Agreement.
"IRC" means the Internal Revenue Code of 1986, as amended from time to
time, and any successor statute.
"IRS" means the Internal Revenue Service of the United States of
America.
"LEASE" means a lease agreement between the Originator and an Obligor
substantially in the form of EXHIBIT K-1 to the Purchase Agreement, together
with any Related Contract Documents that may be entered into in connection with
such lease agreement, pursuant to which the Originator originally leased
Equipment to such Obligor.
"LEASEHOLD IMPROVEMENT NOTE" means a note or instrument substantially
in the form of EXHIBIT K-3 to the Purchase Agreement, together with any Related
Contract Documents that may be entered into in connection with such note or
instrument, evidencing an Obligor's indebtedness to the Buyer on account of a
loan made to finance improvements to, or other costs incurred in connection with
the installation or maintenance of, Equipment.
"LIQUIDITY AGENT" means Banco Santander in its capacity as the agent
for the Liquidity Banks under the Liquidity Agreement, or any successor thereto.
"LIQUIDITY BANKS" means the financial institutions party to the
Liquidity Agreement as "Liquidity Banks" thereunder.
"LIQUIDITY AGREEMENT" means that certain Amended and Restated
Liquidity Agreement, dated as of June 29, 1998, as has been amended and as the
same may be amended, supplemented, restated, supplemented or otherwise modified
from time to time, by and among Triple-A, the Liquidity Banks party thereto and
the Liquidity Agent.
"LIQUIDITY SECURITY AGREEMENT" means that certain Liquidity Security
Agreement dated as of January 31, 1995, as has been amended and as the same may
be amended, restated, supplemented or otherwise modified from time to time, by
and among Triple-A, CapMAC and Banco Santander, in its capacity as the Liquidity
Agent and as "Liquidity Collateral Agent" under the Liquidity Security
Agreement.
"LOCK-BOX ACCOUNT" means an account maintained at a Lock-Box Bank for
the purpose of receiving Collections.
"LOCK-BOX AGREEMENT" means an agreement, in substantially the form of
EXHIBIT G to the Purchase Agreement, among the Originator, the Buyer and a
Lock-Box Bank which agreement sets forth the rights of the Collateral Agent, the
Originator, the Buyer and the Lock-Box Bank with respect to the disposition and
application of the Collections received into the applicable Lock-Box Account,
including, without limitation, the right of the Collateral Agent to
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direct the Lock-Box Bank to remit all Collections of Transferred Assets directly
to the Collateral Agent.
"LOCK-BOX BANK" means any of the banks holding one or more lock-box
accounts for receiving Collections from the Receivables.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA which is, or within the immediately preceding six
(6) years was, contributed to by either the Originator or any ERISA Affiliate.
"NON-DESIGNATED RECEIVABLE" means a Purchased Receivable identified by
the Seller to Triple-A as a "Non-Designated Receivable" pursuant to Section 2.02
of the Triple-A Purchase Agreement.
"NON-MEDICAL CONTRACT" means a Contract the Obligor of which is not
required to be a licensed professional or dental medical practitioner.
"NOTICE OF ASSIGNMENT" means a Notice of Assignment in substantially
the form of EXHIBIT B to the Purchase Agreement.
"OBLIGATIONS" means all present and future indebtedness and other
liabilities and obligations (howsoever created, arising or evidenced, whether
direct or indirect, absolute or contingent, or due or to become due) of the
Seller to Triple-A, the Collateral Agent, the Administrative Agent, the Surety
and/or the Indemnified Parties, arising under or in connection with this
Triple-A Purchase Agreement or the transactions contemplated hereby and shall
include, without limitation, all liability for Yield, closing fees, unused line
fees, audit fees, expense reimbursements, indemnifications, and other amounts
due or to become due under the Facility Documents, including, without
limitation, interest, fees and other obligations that accrue after the
commencement of an Insolvency Proceeding (in each case whether or not allowed as
a claim in such Insolvency Proceeding).
"OBLIGOR" means each Person obligated to make payments under a
Contract.
"ORIGINATOR" means HPSC, Inc., a Delaware corporation.
"OTHER TAXES" has the meaning assigned to such term in SECTION 2.09(b)
of this Triple-A Purchase Agreement.
"OUTSTANDING BALANCE" means, with respect to any Purchased Receivable
at any time, the Discounted Value of the remaining Scheduled Contract Payments
under the related Contract, as such amounts are adjusted as a result of any of
the events described in SECTION 2.05 of the Purchase Agreement.
"PAYMENT DATE" means, with respect to any Capital, the last day of the
Fixed Period then applicable to such Capital.
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"PBGC" means the Pension Benefit Guaranty Corporation and any Person
succeeding to the functions thereof.
"PERMITTED ENCUMBRANCE" means any of the following:
(a) liens, charges or other encumbrances for taxes and other
governmental assessments which are not yet due and payable;
(b) workers', mechanics', suppliers', carriers', warehousemen's,
landlords' liens and deposits, pledges or liens to secure statutory
obligations, surety or appeal bonds or other liens of like general nature
incurred in the ordinary course of business and not in connection with the
borrowing of money, PROVIDED in each case, the obligation secured is not
overdue or, if overdue, is being contested in good faith by appropriate
actions or proceedings, and PROVIDED, FURTHER, that such liens do not, in
the reasonable opinion of the Buyer, materially detract from the value of
the Contract or the Equipment subject thereto;
(d) liens, charges or encumbrances created in favor of the Buyer
pursuant to the Purchase Agreement or in favor of the Collateral Agent or
otherwise granted to Triple-A or to a Liquidity Bank in the Facility
Documents; or
(e) with respect to Equipment, liens thereon created in favor of the
Originator pursuant to a Contract and assigned to the Buyer pursuant to the
Purchase Agreement.
"PERMITTED EXTENSION" means an extension of a Scheduled Contract
Payment in the ordinary course of business for reasons unrelated to an Obligor's
creditworthiness for a period not to exceed 2 months.
"PERMITTED INVESTMENTS" means (i) securities issued or directly and
fully guaranteed or insured by the United States government or any agency or
instrumentality thereof having maturities on or before the first Settlement Date
after the date of acquisition; (ii) time deposits and certificates of deposit
having maturities on or before the first Settlement Date after the date of
acquisition, maintained with or issued by any commercial bank having capital and
surplus in excess of $500,000,000 and having the highest commercial paper rating
available by both Rating Agencies; (iii) money market funds which have the
highest applicable rating available by both Rating Agencies; (iv) repurchase
agreements having maturities on or before the first Settlement Date after the
date of acquisition for underlying securities of the types described in clauses
(i) and (ii) above or clause (v) below with any institution with the highest
long term debt rating and commercial paper rating available by both Rating
Agencies; and (v) commercial paper maturing on or before the first Settlement
Date after the date of acquisition and having the highest commercial paper
rating available by both Rating Agencies.
"PERSON" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, government (or any agency or political subdivision thereof) or other
entity.
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"PLAN" means an employee benefit plan defined in Section 3(3) of ERISA
in respect of which the Originator or any ERISA Affiliate is, or within the
immediately preceding six years was, an "employer" as defined in Section 3(5) of
ERISA.
"POST OFFICE BOX" means each post office box to which Obligors are
directed to mail payments in respect of the Receivables.
"PRACTICE FINANCE LOAN" means a note or instrument substantially in
the form of EXHIBIT K-4 to the Purchase and Contribution Agreement, together
with any Related Contract Documents that may be entered into in connection with
such note or instrument, evidencing an Obligor's indebtedness on account of a
loan made to finance working capital needs of such Obligor, in connection with
such Obligor's professional dental, medical or veterinary practice.
"PURCHASE" means a purchase (whether by means of cash payment or by
capital contribution) of Transferred Assets by the Buyer from the Originator
pursuant to SECTIONS 2.01 and 2.02 of the Purchase Agreement.
"PURCHASE AGREEMENT" means that certain Amended and Restated Purchase
and Contribution Agreement, dated as of March 31, 2000, as the same may be
amended, restated, supplemented or otherwise modified from time to time, between
the Originator and the Buyer.
"PURCHASE DATE" means, with respect to any Purchase, the date on which
such purchase occurs.
"PURCHASED ASSETS" (i) at all times prior to the Termination Date, (a)
all then outstanding Purchased Receivables, (b) all Related Security relating to
such Purchased Receivables and (c) all Collections with respect to, and other
proceeds of, such Receivables and (ii) at all times on and after the Termination
Date, (a) all Purchased Receivables outstanding as of the close of business on
the day preceding the Termination Date (including any interest or finance
charges accruing after the Termination Date which relate to any Purchased
Receivables outstanding as of the close of business on the day preceding the
Termination Date), (b) all Related Security relating to such Purchased
Receivables and (c) all Collections with respect to, and other proceeds of, such
Receivables.
"PURCHASED RECEIVABLES" means all Receivables purchased by Triple-A
pursuant to this Triple-A Purchase Agreement.
"RATING AGENCIES" means, collectively, Standard & Poor's Corporation
and Xxxxx'x Investors Services, Inc., or their respective successors.
"RECEIVABLE" means all rights to payment arising under a Contract,
including, without limitation, (i) Contract Payments, (ii) Termination Payments
and (iii) Residual Realizations, together with all supplemental or additional
payments required by the terms of such Contract with respect to insurance,
maintenance, ancillary products and services and other specific charges.
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"RECEIVABLES PURCHASE" means a purchase (whether by means of cash
payment or by capital contribution) of Receivables by Triple-A from the Seller
pursuant to SECTIONS 2.01 and 2.02 of the Triple-A Purchase Agreement.
"RECEIVABLES PURCHASE DATE" means, with respect to any Receivables
Purchase, the date on which such Receivables Purchase is funded, which date,
other than in the case of the initial Receivables Purchase, shall be a
Settlement Date.
"RECORDS" means all Contracts and other documents, books, records and
other information (including without limitation, computer programs, tapes,
discs, punch cards, data processing software and related property and rights)
maintained with respect to Contracts and the related Obligors. "RELATED CONTRACT
DOCUMENT" means any agreement or document substantially in the form of EXHIBIT
K-5 to the Purchase Agreement which may be entered into contemporaneously with a
Contract.
"RELATED SECURITY" means with respect to any Contract:
(i) all security interests or liens and property subject thereto from
time to time purporting to secure payment of the Receivables arising under
such Contract, whether pursuant to such Contract or otherwise;
(ii) the assignment to the Buyer, of all UCC financing statements
covering any Equipment or covering any collateral securing payment of the
Receivable arising under such Contract;
(iii) all guarantees, indemnities, warranties, letters of credit,
insurance policies and proceeds and premium refunds thereof and other
agreements or arrangements of whatever character from time to time
supporting or securing payment of the Receivables arising under such
Contract whether pursuant to the Contract related to such Receivable or
otherwise;
(iv) all of the Originator's right, title and interest in, to and
under the Equipment related to such Contract, whether as an ownership
interest, as collateral security, or which was repossessed from an Obligor
of a Receivable to the extent that the Outstanding Balance of such
Receivable remains unpaid;
(v) all Records; and
(vi) all Collections and other proceeds of the foregoing, including,
without limitation, all insurance and condemnation proceeds and all
security deposits related to the Equipment.
"REPORTABLE EVENT" means any of the events described in Section 4043
of ERISA.
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"RESIDUAL REALIZATION" means, with respect to any Equipment, the
amount received or receivable by the Buyer or the Servicer upon the sale or
other disposition of the Equipment, whether from the Obligor upon the exercise
of any purchase option or from a sale or from insurance proceeds or otherwise.
"SALE NOTICE" has the meaning set forth in SECTION 2.02(a) of the
Triple-A Purchase Agreement.
"SCHEDULED CONTRACT PAYMENTS" means the Contract Payments due under
each Contract, as set forth in the appendix to EXHIBIT A of the Purchase
Agreement (including any supplement to such exhibit delivered under SECTION
2.02(b) thereof and also including any modification to such appendix as the
result of any modification, waiver or amendment to any Contract undertaken in
conformity with the Purchase Agreement), excluding, however, (i) in the case of
any Contract which is not a Lease, starting with the final Contract Payment owed
thereunder and proceeding in reverse order of maturity, the Contract Payments
(or portions thereof) equal to any security deposit related to such Contract and
(ii) any Contract Payment that is due more than 72 months (unless such Contract
is a Contract that is permitted to come due in 84 months under the definition of
Eligible Receivables, in which case 84 months) after the original commencement
date of such Contract. The term "Scheduled Contract Payment" does not include
any Contract Payment which is payable in respect of any Residual Realization or
which otherwise reflects the residual value of the related Equipment.
"SCHEDULED LIQUIDITY COMMITMENT TERMINATION DATE" has the meaning
assigned to that term in the Liquidity Agreement.
"SCHEDULED TERMINATION DATE" means June 29, 2003.
"SELLER" means HPSC Bravo Funding Corp., a Delaware corporation.
"SERVICER" has the meaning assigned to that term in SECTION 6.01 of
this Triple-A Purchase Agreement.
"SERVICING FEE" has the meaning assigned to that term in SECTION 6.08
of this Triple-A Purchase Agreement.
"SERVICING TERMINATION EVENT" means a failure on the part of the
Servicer to observe or perform any of its duties or obligations as Servicer
under this Triple-A Purchase Agreement or as "Servicer" under the Purchase
Agreement, as determined by the Collateral Agent in its reasonable judgment.
"SETTLEMENT DATE" means the 20th day of each month; PROVIDED, that if
in any month such day is not a Business Day, the "SETTLEMENT DATE" for such
month shall be the first Business Day to occur after such 20th day.
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"SETTLEMENT REPORT" means a report, in substantially the form of
EXHIBIT C to the Purchase Agreement, furnished by the Originator to the Buyer
pursuant to SECTION 2.05(b) thereof and to the Collateral Agent pursuant to
SECTION 5.02(f) hereof.
"SUBSIDIARY" means, as to any Person, any corporation or other entity
of which securities or other ownership interests having ordinary voting power to
elect a majority of the Board of Directors or other Persons performing similar
functions are at the time directly or indirectly owned by such Person.
"SUCCESSOR SERVICER" means any Person which succeeds to the Originator
as the Servicer in accordance with the terms and provisions of this Triple-A
Purchase Agreement.
"SURETY" means CapMAC.
"SURETY BONDS" means the Surety Bonds for the benefit of Triple-A and
the Liquidity Banks to be issued by the Surety under the Insurance Agreement.
"SWAP BOND" means that certain surety bond in favor of the Swap
Provider whereby CapMAC guarantees the payments to be made by the Seller under
the Interest Rate Xxxxxx.
"SWAP PROVIDER" means Bank of Boston or such other financial
institution reasonably acceptable to CapMAC which enters into an Interest Rate
Hedge with the Seller, PROVIDED that the Swap Provider must at all times be a
nationally recognized financial institution rated A or better by Standard &
Poor's Corporation or the equivalent by Xxxxx'x Investors Services, Inc.
"TAXES" has the meaning assigned to such term in SECTION 2.10(a) of
this Triple-A Purchase Agreement.
"TERMINATION AMOUNT" means, with respect to any Contract which has
been prepaid or otherwise terminated prior to its stated maturity or termination
date, an amount equal to the present value of the remaining Scheduled Contract
Payments, discounted to the date of prepayment or termination at the Discount
Rate, PLUS, any billed and uncollected amounts related to and amounts owing
under such Contract, including late charges and overdue interest charges, PLUS,
if such Contract is a Lease or Finance Agreement pursuant to which the Buyer
finances an Obligor's purchase of Equipment, the booked residual value of the
related Equipment, PLUS any processing fees charged to cover expenses.
"TERMINATION DATE" means the earliest of (i) that Business Day which
the Originator designates as the Termination Date by notice to the Buyer and the
Administrative Agent at least thirty calendar days prior to such Business Day,
(ii) that Business Day which the Buyer designates as the Termination Date by
notice to the Originator and the Administrative Agent at least thirty calendar
days prior to such Business Day, (iii) the date of the declaration or automatic
occurrence of the Termination Date pursuant to SECTION 7.01 of the Purchase
Agreement, SECTION 7.02 of the Credit Agreement or SECTION 7.02 of the Triple-A
Xxxxxxxx
00
00
Xxxxxxxxx, (xx) the Scheduled Liquidity Commitment Termination Date and (v) the
Scheduled Termination Date.
"TERMINATION PAYMENT" means any amount or amounts payable by an
Obligor upon termination or prepayment of a Contract prior to the payment of all
Contract Payments.
"TRANSFERRED ASSETS" means, at any time, the Receivables, the
Contracts, the Equipment, all Related Security with respect to the foregoing and
all Collections with respect to, and other proceeds of, the foregoing.
"TRIPLE-A" means Triple-A One Funding Corporation, a Delaware
corporation.
"TRIPLE-A PURCHASE AGREEMENT" means the Amended and Restated Lease
Receivables Purchase Agreement, dated as of March 31, 2000, by and among HPSC
Bravo Funding Corp., a Delaware corporation, HPSC, Inc., a Delaware corporation,
Triple-A One Funding Corporation, a Delaware corporation, and Capital Markets
Assurance Corporation, a New York Stock insurance company, as the same may be
amended, restated, supplemented or otherwise modified from time to time.
"UCC" means the Uniform Commercial Code as from time to time in effect
in the State of New York, except that, with respect to the perfection or
priority of any security interest created under the UCC, the term "UCC" means
the Uniform Commercial Code as in effect in the jurisdiction whose law governs
the perfection and effect of perfection or non-perfection of such security
interest.
"UNMATURED EVENT OF TERMINATION" means any event which, with the
giving of notice or the passage of time or both, would constitute an Event of
Termination.
"UNMATURED WIND-DOWN EVENT" means any event which, with the giving of
notice or the passage of time or both, would constitute a Wind-Down Event.
"WEIGHTED AVERAGE REMAINING TERM" means the weighted average remaining
maturities of the Purchased Assets calculated to equal (i) the aggregate amount
of the remaining Scheduled Contract Payments of each Purchased Receivable TIMES
the remaining term of such Purchased Receivable, DIVIDED BY (ii) the aggregate
amount of the remaining Scheduled Contract Payments of all the Purchased
Receivables (each such calculation to include, for purposes of calculating the
Weighted Average Remaining Term on any Settlement Date, any Purchased
Receivables to be purchased on such date).
"WIND-DOWN EVENT" has the meaning assigned to such term in SECTION
7.01 of this Triple-A Purchase Agreement.
"YIELD" means, with respect to all Capital during any Fixed Period,
the product of
YR x C x ED
--
AD
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where:
C = the Capital allocated to such Fixed Period.
YR = the Yield Rate for the Capital allocated to such Fixed Period.
ED = the actual number of days elapsed during such Fixed
Period.
AD = 360; provided, however, that if the applicable Yield Rate is the
Base Rate, then AD = 365 or 366 days, as applicable, for the
current year.
PROVIDED, HOWEVER that (i) no provision of this Agreement shall require the
payment or permit the collection of Yield in excess of the maximum permitted by
applicable law and (ii) Yield shall not be considered paid by any distribution
if at any time such distribution is rescinded or must otherwise be returned for
any reason.
"YIELD RATE" for any Capital allocated to any Fixed Period means:
(a) to the extent that as of the first day of such Fixed Period,
Triple-A funds such Capital, or portion thereof, for such Fixed Period by
issuing Commercial Paper, the rate (or if more than one rate, the weighted
average of the rates) at which Commercial Paper of Triple-A having a term
equal to such Fixed Period and to be issued to fund the Purchase or
maintenance of such Capital by Triple-A may be sold by any Dealer selected
by Triple-A, as agreed between each such Dealer and Triple-A and notified
by Triple-A to the Administrative Agent and the Collateral Agent; PROVIDED,
HOWEVER, if the rate (or rates) as agreed between any such Dealer and
Triple-A with regard to any Fixed Period for any Capital is a discount rate
(or rates), the "YIELD RATE" for such Fixed Period shall be the rate (or if
more than one rate, the weighted average of the rates) resulting from
converting such discount rate (or rates) to an interest-bearing equivalent
rate (or rates) per annum; or
(b) to the extent that as of the first day of such Fixed Period,
Triple-A funds or maintains such Capital, or portion thereof, for such
Fixed Period through the making of Base Rate Advances, a per annum rate
equal to the Base Rate for such Fixed Period or such other rate as the
Administrative Agent and the Seller shall agree to in writing; or
(c) to the extent that as of the first day of such Fixed Period,
Triple-A funds or maintains such Capital, or portion thereof, for such
Fixed Period through the making of Eurodollar Rate Advances under the
Liquidity Agreement, a per annum rate equal to the Eurodollar Rate for such
Fixed Period plus one-half of one percent (.50%).
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DEFINITIONS LIST
Unless otherwise defined therein, the capitalized terms used in the
documents listed below shall have the meanings set forth in this Definitions
List.
1. Amended and Restated Purchase and Contribution Agreement, dated as of
March 31, 2000 (the "PURCHASE AGREEMENT"), between the Seller and the
Buyer, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
2. Credit Agreement, dated as of January 31, 1995 (as amended, the
"CREDIT AGREEMENT"), among the Borrower, Triple-A, and Capital Markets
Assurance Corporation ("CapMAC") as the Administrative Agent and the
Collateral Agent, as the same may be amended, restated, supplemented
or otherwise modified from time to time.
3. Insurance and Indemnity Agreement, dated as of January 31, 1995 (as
amended, the "INSURANCE AGREEMENT"), among Triple-A, the Borrower, the
Liquidity Agent and CapMAC, as the Administrative Agent and the
Collateral Agent, as the same may be amended, restated, supplemented
or otherwise modified from time to time.
4. Fourth Amended and Restated Fee Letter Agreement, dated March 31, 2000
(the "FEE LETTER"), among the Borrower and CapMAC individually, as the
Administrative Agent and the Collateral Agent, as the same may be
amended, restated, supplemented or otherwise modified from time to
time.
5. Custodial Agreement, dated as January 31, 1995 (as amended, the
"CUSTODIAL AGREEMENT") among Triple-A, the Seller, the Borrower, the
Custodian and the Collateral Agent, as the same may be amended,
restated, supplemented or otherwise modified from time to time.
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DEFINITIONS LIST
"ADVANCE" means an "Advance" funded to Triple-A under the Liquidity
Agreement.
"ADMINISTRATIVE AGENT" means CapMAC in its capacity as "Administrative
Agent" for Triple-A.
"ADVERSE CLAIM" means a lien, security interest, charge, encumbrance
or other right or claim of any Person other than Permitted Encumbrances.
"AFFILIATE" means, with respect to any Person, a Person: (i) that
directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such Person; (ii) that
beneficially owns or holds 5% or more of any class of the voting stock (or, in
the case of a Person that is not a corporation, 5% or more of the equity
interest) of such Person; or (iii) 5% or more of the voting stock (or, in the
case of a Person that is not a corporation, 5% or more of the equity interest)
of which is beneficially owned or held, directly or indirectly, by such Person.
The term "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting stock or an equity interest, by
contract, or otherwise.
"AFFILIATED OBLIGOR" means any Obligor which is an Affiliate of
another Obligor.
"AGGREGATE OUTSTANDINGS" means, on any day, an amount equal to the sum
of (i) the outstanding principal amount of the Triple-A Loans and (ii) the
outstanding "Capital" under the Triple-A Purchase Agreement.
"AGGREGATE RESERVES" has the meaning set forth in the Credit
Agreement.
"BANCO SANTANDER" means Banco Santander Central Hispano, a Spanish
bank, New York Branch.
"BANK OF BOSTON" means The First National Bank of Boston, now known as
Fleet Capital Corporation, a national banking association.
"BANKRUPTCY CODE" means Title 11 of the United States Code (11 U.S.C.
Section 101 ET SEQ.), as amended from time to time, or any successor statute.
"BASE RATE" means a fluctuating interest rate per annum equal to the
higher of (i) the rate of interest published in the Wall Street Journal as the
prime rate, or, in the event that no such rate is published, the rate of
interest announced publicly by the Liquidity Agent in New York, New York, as its
prime or reference rate, whether or not such rate is the lowest rate offered by
such institution to its corporate borrowers and (ii) 1/2 of one percent per
annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance which bears interest at the Base
Rate.
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"BENEFIT PLAN" means a defined benefit plan as defined in Section
3(35) of ERISA (other than a Multiemployer Plan) in respect of which the Seller
or any ERISA Affiliate is, or at any time within the immediately preceding six
(6) years was, an "employer" as defined in Section 3(5) of ERISA.
"BORROWER" means HPSC Bravo Funding Corp., a Delaware corporation.
"BORROWING" means a borrowing of Triple-A Loans under the Credit
Agreement.
"BORROWING BASE" means, on any day, (A) the Discounted Eligible
Receivables Balance on such day MINUS (B) the Aggregate Reserves then in effect.
"BORROWING DATE" means, with respect to any Borrowing, the date on
which such Borrowing is funded, which date, other than in the case of the
Closing Date, shall be a Settlement Date.
"BUSINESS DAY" means any day other than a Saturday, Sunday or public
holiday or the equivalent for banks in New York City or Boston, Massachusetts;
PROVIDED that, when used in connection with any Eurodollar Rate Advance or other
matters concerning the Eurodollar Rate, the term "Business Day" means any such
day on which dealings are carried on in the London interbank market and on which
banks are open for business in London, England.
"BUYER", when used in the Purchase Agreement or in these definitions,
means HPSC Bravo Funding Corp., a Delaware corporation.
"CAPMAC" means Capital Markets Assurance Corporation, a New York stock
insurance company.
"CARRYING COSTS" means, at any time, the aggregate amount of (i) all
accrued and unpaid interest, fees, premiums and other expenses owing by the
Borrower to Triple-A, the Collateral Agent, the Dealer, the Surety, the Swap
Provider, the Servicer and the Administrative Agent (including, without
limitation, all fees owed under the Fee Letter, collateral audit fees and
expenses, the Servicing Fee, the CP Dealer Fees and the Surety Bond Premium)
PLUS (ii) all ordinary course operating expenses incurred by the Borrower during
such calendar month (including rent, salaries, professional fees and expenses
incurred in connection therewith).
"CARRYING COSTS PERCENTAGE" means a percentage, calculated as of the
last day of each month equal to the sum of (i) the sum of the per annum rates
used to calculate the Servicing Fee and the "Administration Fee" and "Program
Fee" described in the Fee Letter PLUS (ii) a fraction (expressed as a
percentage) the numerator of which equals Carrying Costs described in clause
(ii) of the definition thereof which were incurred during the calendar month
then ending and the denominator of which equals the average Aggregate
Outstandings during such month.
"CERTIFICATE" means a certificate of assignment, in the substantially
the form delivered on the Closing Date, evidencing the assignment by the Seller
to the Buyer of the Transferred Assets.
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"CLOSING DATE" means the date on which the Borrower makes its initial
Borrowing under the Credit Agreement and its initial Purchase under the Purchase
Agreement.
"COLLATERAL" has the meaning assigned thereto in SECTION 6.01 of the
Credit Agreement.
"COLLATERAL AGENT" means CapMAC, in its capacity as Collateral Agent
pursuant to the Credit Agreement and the Triple-A Purchase Agreement, and any
successor Collateral Agent.
"COLLECTION ACCOUNT" has the meaning assigned thereto in SECTION 6.06
of the Credit Agreement.
"COLLECTION ACCOUNT BANK" means the bank maintaining the Collection
Account.
"COLLECTION DATE" means the date following the Termination Date on
which (i) the aggregate outstanding Triple-A Loans have been paid in full, (ii)
Triple-A has received all interest, fees and other amounts payable under the
Credit Agreement and the other Facility Documents (other than the Triple-A
Purchase Agreement) and (iii) the Surety Bonds have been discharged (other than
through payment thereunder).
"COLLECTIONS" means, with respect to any Transferred Asset or
Receivable, as applicable, all cash collections and other cash proceeds of such
Transferred Asset or Receivable, including, without limitation, all cash
proceeds of Related Security related thereto, and, in the case of Transferred
Assets, all cash collections of any Receivables included therein, and, in either
such case, any Collection of such Transferred Asset or Receivable deemed to have
been received pursuant to SECTION 2.05 of the Purchase Agreement (it being
understood that the Seller shall pay all such deemed Collection amounts to the
Buyer by depositing the amount thereof into the Lock-Box Account).
"COMMERCIAL PAPER" means the short-term promissory notes of Triple-A
denominated in dollars, issued by Triple-A in connection with the transactions
contemplated by the Facility Documents, including any portion of such short-term
promissory notes that are identified on the books and records of Triple-A as
issued in respect of the transactions contemplated by the Facility Documents.
"CONTRACT" means each Lease, Finance Agreement, Leasehold Improvement
Note, Practice Finance Loan, Non-Medical Contract or other agreement or
instrument which is purported to be transferred to the Buyer under the Purchase
Agreement, whether by purchase or contribution to the Buyer's capital, as
identified on EXHIBIT A of the Purchase Agreement as such exhibit may be
supplemented from time to time in connection with any subsequent Purchase as
described in SECTION 2.02(b) of the Purchase Agreement.
"CONTRACT FILE" means, with respect to each Contract, the following
documents:
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(i) The executed original counterpart of each Contract that
constitutes "chattel paper" under 9-105(1)(b) of the UCC or that
constitutes an "instrument" for purposes of 9-105(1)(i) of the UCC;
(ii) Any evidence of insurance and any other documents evidencing or
related to any insurance policy maintained by the related Obligor pursuant
to the Contract that covers physical damage to the Equipment;
(iii) If the related Contract is a Lease, copies of such documents, if
any, indicating that the Equipment was, as of the date such Contract arose,
owned by the Seller and kept on file by the Seller in accordance with its
customary procedures relating to such type of Contract, such Obligor and
such item of Equipment; and
(iv) Copies (if available) of UCC financing statements filed by the
Seller with respect to the related Equipment or, if no such copies are
available, other documentary evidence confirming the filing thereof.
"CONTRACT PAYMENT" means each periodic installment payable by an
Obligor under a Contract for rent, principal and/or interest, excluding all
supplemental or additional payments required by the terms of such Contract with
respect to sales or other taxes, insurance, maintenance, ancillary products and
services and other specific charges.
"CONTRACT PAYMENT DATE" means, with respect to any Contract, each date
on which a Contract Payment is or becomes due and payable thereunder.
"CP DEALER FEE" means, on any day, the fees payable to the Dealer in
respect of any Commercial Paper.
"CP DISRUPTION" means the inability of Triple-A, at any time, whether
as a result of a prohibition or any other event or circumstance whatsoever, to
raise funds through the issuance of its commercial paper notes (whether or not
constituting Commercial Paper as defined above) in the United States commercial
paper market.
"CREDIT AGREEMENT" has the meaning assigned thereto on the first page
of this Definitions List.
"CREDIT AND COLLECTION POLICY" means those credit and collection
policies and practices relating to the Contracts and the Receivables described
in EXHIBIT D of the Purchase Agreement, as modified in compliance with SECTION
5.03(c).
"CUSTODIAL AGREEMENT" has the meaning assigned thereto the first page
of this Definitions List.
"CUSTODIAN" means Bank of Boston, in its capacity as "Custodian" under
the Custodial Agreement, or any successor thereto under the Custodial Agreement.
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"CUT-OFF DATE" means December 31, 1994.
"DEALER" means any dealer or placement agent in respect of the
Commercial Paper.
"DEFAULT RATIO" means the ratio (expressed as a percentage), computed
as of the last day of each month by dividing (i) two times the aggregate
Outstanding Balance of all Pledged Receivables that became Defaulted Receivables
or were written off the books of the Buyer as uncollectible during the six-month
period then ending by (ii) the average aggregate Outstanding Balances of all
Pledged Receivables during such six-month period.
"DEFAULT RESERVE RATIO" means the ratio (expressed as a percentage),
computed as of the last day of each month in accordance with the following
formula:
DRR = 2 X ADR X WRT, where
DRR = the Default Reserve Ratio;
ADR = the six-month rolling average of the Default Ratios for the six
most recent calendar months (including the month then ending); and
WRT = the Weighted Average Remaining Term as expressed in years of the
Pledged Receivables as of such day.
"DEFAULTED RECEIVABLE" means a Receivable at any time: (i) as to which
any Scheduled Contract Payment or part thereof is unpaid more than 180 days from
its original due date, (ii) as to which the Obligor thereof has taken any
action, or suffered any event to occur, of the type described in the definition
of Insolvency Event or (iii) which, consistent with the Credit and Collection
Policy, has been or should be written off the Borrower's books as uncollectible.
"DELINQUENCY RATIO" means the ratio (expressed as a percentage),
computed as of the last day of each month, by dividing (i) the aggregate
Outstanding Balance of all Pledged Receivables which became Delinquent
Receivables during the three-month period then ending, by (ii) the sum of the
aggregate Outstanding Balances of all Pledged Receivables as of each of the last
days of the fifth, fourth and third preceding calendar months (so that, for
example, the Delinquency Ratio calculated as of June 30th would have a
denominator equal to the sum of the Outstanding Balances of all Pledged
Receivables as of January 31st, February 28th, and March 31st).
"DELINQUENT RECEIVABLE" means a Receivable that is not a Defaulted
Receivable and (i) as to which any Scheduled Contract Payment or part thereof,
is unpaid more than 90 days from its original due date or (ii) which, consistent
with the Credit and Collection Policy, has been or should be classified as
delinquent by the Seller.
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"DESIGNATED OBLIGOR" means, at any time, any Obligor of the Seller
whom the Collateral Agent has, following three Business Days' notice, advised
the Seller that such Obligor shall be considered a Designated Obligor.
"DESIGNATED TERMINATION DATE" means the date of the declaration or
automatic occurrence of the Termination Date pursuant to SECTION 7.01 of the
Purchase Agreement or SECTION 7.02 of the Credit Agreement.
"DILUTION FACTORS" means with respect to the Receivables, any credits,
rebates, freight charges, cash discounts, volume discounts, cooperative
advertising expenses, royalty payments, warranties, cost of parts required to be
maintained by agreement (whether express or implied), allowances, disputes,
chargebacks, returned or repossessed goods, inventory transfers, allowances for
early payments and other allowances that are made or coordinated with the
Seller's usual practices.
"DISCOUNT RATE" means (i) with respect to any Lease or Finance
Agreement pursuant to which the Buyer finances an Obligor's purchase of
Equipment, the discount rate used to calculate the aggregate Discounted Value of
the Scheduled Contract Payments payable under the related Contract as of the
last day of the month immediately preceding the month in which such Receivable
was acquired from the Seller and (ii) with respect to any other Contract, the
interest rate set forth in such Contract. The Discount Rate for such Leases or
Finance Agreements transferred on any date shall be a rate equal to the sum of
(i) the interest rate per annum quoted to the Borrower by the Swap Provider as
the rate at which such Swap Provider is willing to enter into an Interest Rate
Hedge pursuant to which the Seller will pay an interest rate calculated in
conjunction with an Interest Rate Hedge amortization prepared by the Borrower
and which complies with SECTION 5.01(n) of the Credit Agreement, and in return
shall receive a floating interest rate (calculated against the same principal
amount) approximately equal to the Eurodollar Rate, PLUS (ii) .15% per annum
PLUS (iii) the Carrying Costs Percentage at such time; PROVIDED, that the Seller
may, at its option, with respect to the Receivables transferred on any
Settlement Date, designate a rate which is higher than the rates calculated
above to be the "Discount Rate" for such Receivables.
"DISCOUNTED ELIGIBLE RECEIVABLES BALANCE" means, as of any date of
determination, the aggregate of the Discounted Values for all Pledged
Receivables which constitute Eligible Receivables.
"DISCOUNTED RECEIVABLES BALANCE" means, as of any date of
determination, the aggregate of the Discounted Values for all Receivables or
Pledged Receivables, as the case may be.
"DISCOUNTED VALUE" means, (i) with respect to any Lease or Finance
Agreement pursuant to which the Buyer finances an Obligor's purchase of
Equipment, the present value of the aggregate amount of the remaining Scheduled
Contract Payments under the Contract relating thereto, with such aggregate
amount discounted to present value using the Discount Rate for such Scheduled
Contract Payments and a payment schedule of the first day of each month
commencing with the first day of the month in which the Discounted Value is
calculated and
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assuming that each Scheduled Contract Payment is paid on the last Business Day
of the month in which such Scheduled Contract Payment is due; it being
understood that the Discounted Value for that portion of any Receivable which
constitute payments or charges excluded from the definition of Contract Payment
or which constitute the price for a purchase option shall be zero; and (ii) with
respect to any other Contract, as of any date of determination, the outstanding
principal amount thereof.
"DOL" means the United States Department of Labor and any successor
department or agency.
"ELIGIBLE OBLIGOR" means, at any time, an Obligor who is a licensed
professional dental or medical practitioner and who (i) is not an Affiliate of
the Seller; (ii) is not the subject of any Insolvency Proceeding; (iii) is not a
Designated Obligor; (iv) is a United States resident; (v) is not the United
States of America nor any state, or other local governmental agency, or any
department, agency or instrumentality thereof and (vi) is not an Obligor of any
Defaulted Receivable; PROVIDED, HOWEVER, that an Obligor of a Non-Medical
Contract that otherwise constitutes an Eligible Receivable shall not be required
to be a licensed professional dental or medical practitioner.
"ELIGIBLE RECEIVABLE" means, at any time, a Receivable:
(i) the Obligor of which is an Eligible Obligor;
(ii) which is not a Delinquent Receivable or a Defaulted
Receivable;
(iii) which (a) if evidenced by a Practice Finance Loan, is
required pursuant to the terms thereof to be paid in full within 84
months of the original commencement date of such Loan (or such longer
period as may be consented to by the Collateral Agent and the
"Majority Liquidity Banks" (as such term is defined in the Liquidity
Agreement)), and (b) if evidenced by a Contract other than a Practice
Finance Loan, is required pursuant to the terms thereof to be paid in
full within 72 months of the original commencement date thereof (or
such longer period as may be consented to by the Collateral Agent and
the "Majority Liquidity Banks" (as such term is defined in the
Liquidity Agreement); PROVIDED, HOWEVER, that an aggregate amount of
30% of such Contracts that are not Practice Finance Loans and are
underlying Purchased Receivables may be allowed pursuant to the terms
thereof to be paid in full within 84 months of the original
commencement date thereof so long as each such Contract satisfies each
other requirement for an Eligible Receivable as set forth herein;
(iv) which, if arising under a Lease or Finance Agreement
pursuant to which the Buyer finances an Obligor's purchase of
Equipment, arises under such terms and conditions that the Equipment
related thereto has been installed and accepted by the related
Obligor;
(v) the original Outstanding Balance of which, when added to the
Outstanding Balance of all other Receivables owing by the same Obligor
at such time, does not exceed the lesser of (i) $1,000,000 and (ii)
1.5% of the Discounted Eligible Receivables Balance at such time;
(vi) which is either an "account" (as defined in Section 9-106 of
the UCC) or "chattel paper" (as defined in Section 9-105 of the UCC)
or an "instrument" (as defined in Section 9-105 of the UCC) as in
effect in any jurisdiction which has adopted Article 9 of the UCC and,
if the Contract is chattel paper, then there is only one counterpart
of the Contract that constitutes "chattel paper" for purposes of
Section 9-105(l)(b) and 9-308 of the UCC;
(vii) which is denominated and payable only in United States
dollars in the United States;
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(viii) which arises under a Contract which has been duly
authorized and which is in full force and effect and constitutes the
legal, valid and binding obligation of the Obligor enforceable against
such Obligor in accordance with its terms and is not subject (at the
time each determination of eligibility is made hereunder) to any
dispute, offset or counterclaim whatsoever;
(ix) which, together with the Contract related thereto, does not
contravene in any material respect any laws, rules or regulations
applicable thereto (including, without limitation, laws, rules and
regulations relating to truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection
practices and privacy) and with respect to which no party to the
Contract related thereto is in violation of any such law, rule or
regulation applicable to such Contract in any material respect;
(x) which, has not been compromised, adjusted, rewritten or
otherwise modified (including by extension of time for payment or the
granting of any discounts, allowances or credits) for any reason
unless such modification constitutes a Permitted Extension;
(xi) which (A) satisfies all applicable requirements of the
Credit and Collection Policy and (B) which is freely assignable and
arises under a Contract which is also freely assignable;
(xii) with respect to which, from and after the Purchase thereof,
(A) the Buyer has a first priority ownership therein, free and clear
of any Adverse Claim; and (B) the Collateral Agent has a first
priority perfected security interest free and clear of any Adverse
Claim;
(xiii) which arises under a Contract, none of the parties to
which have done or failed to do anything which would or might permit
any other party thereto to terminate such Contract or to suspend or
reduce any payments or obligations due or to become due thereunder;
(xiv) which does not constitute a "consumer lease" under the UCC;
(xv) which, if it arises under a Lease, such Lease requires the
Obligor to maintain insurance against loss or damage to the Equipment
subject to such Lease under an insurance policy which names the Buyer
or the Seller as loss payee and which interest as loss payee has been
transferred to the Buyer pursuant to the Purchase Agreement and been
assigned to the Collateral Agent as security in accordance with the
Credit Agreement;
(xvi) which arises under a Contract, no portion of which has
been, or is subject to rejection, early termination or non-assumption,
prior to the original term of such Contract except, in the case of a
Practice Finance Loan, pursuant to a provision therein requiring
payment of a Termination Amount upon any such rejection, early
termination or non-assumption;
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(xvii) which arises under a Contract that requires payments to be
made on a regular periodic basis and which payments, in the case of
any Lease, do not represent the payment of interim rents;
(xviii) which arises under a Contract that requires the Obligor
to be in possession of any Equipment subject thereto and does not
permit the subleasing of such Equipment to any other Person;
(xix) no portion of which is payable on account of sales taxes;
(xx) as to which the Collateral Agent has not notified the Seller
that the Collateral Agent has determined, in its reasonable
discretion, that such Receivable (or class of Receivables) is not
acceptable for eligibility hereunder (which notice shall state the
reason(s) the Collateral Agent has elected to make such
determination);
(xxi) which was originated or acquired by the Seller in the
ordinary course of its business;
(xxii) the Discounted Value of which, (A) if arising under a
Leasehold Improvement Note, when added to the Discounted Value of all
Eligible Receivables arising under Leasehold Improvement Notes, does
not exceed 25% of the Discounted Eligible Receivables Balance, (B) if
arising under a promissory note, when added to the Discounted Value of
all Eligible Receivables arising under promissory notes, does not
exceed 10% of the Discounted Eligible Receivables Balance, and (C) if
arising under either a Leasehold Improvement Note or a promissory
note, when added to the Discounted Value of all Eligible Receivables
arising under both Leasehold Improvement Notes and promissory notes,
does not exceed 30% of the Discounted Eligible Receivables Balance;
(xxiii) the Contract for which is either (A) a Lease in
substantially the same form of EXHIBIT K-1 to the Purchase Agreement,
(B) a Finance Agreement in substantially the same form of EXHIBIT K-2
thereto, (C) a Leasehold Improvement Note in substantially the same
form of EXHIBIT K-3 thereto, (D) a Practice Finance Loan in
substantially the same form of EXHIBIT K-4 thereto, underwritten in
accordance with Practice Finance Loan underwriting criteria, as
attached to EXHIBIT K-4, and which, when added to all Practice Finance
Loans, does not exceed 20% of the Discounted Eligible Receivables
Balance; (E) a Non-Medical Contract in substantially the form of
EXHIBIT K-1, EXHIBIT K-2, EXHIBIT K-3 or EXHIBIT K-4 to the Purchase
Agreement, or (F) a promissory note, the Discounted Value of which,
when added to the Discounted Value of all Eligible Receivables owed by
such Obligor and not described under (A), (B), (C), (D) or (E) above,
does not exceed $150,000; PROVIDED, that if a Contract is a
Non-Medical Contract, the Discounted Value of such Non-Medical
Contract, when added together with the Discounted Values of all other
Non-Medical Contracts, does not exceed 10% of the Discounted Eligible
Receivables Balance;
(xxiv) with respect to which the Seller has filed and maintained
the effectiveness of UCC financing statements against the Obligor in
order to perfect any security interest granted under in such Contract
in the related Equipment, PROVIDED that failure to maintain the
effectiveness of any financing statements for an otherwise Eligible
Receivable whose Outstanding Balance has been reduced below $5,000
shall, so long as such failure is permitted by SECTION 5.01(j) of the
Credit Agreement, not cause such Receivable to become ineligible;
(xxv) the Contract for which was originated no earlier than
December 1, 1993 and no later than the date which is one month prior
to the Purchase thereof by the Buyer and for which the Obligor has
made at least one Scheduled Contract Payment in full and in a timely
manner;
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(xxvi) the Obligor of which has been notified of the Buyer's
interest as required under the Purchase Agreement;
(xxvii) with respect to which the Contract File has been
delivered to the Custodian as contemplated under the Custodial
Agreement;
(xxviii) the Obligors of which are either (A) licensed dental,
medical or veterinary professionals or (B) corporations or similar
entities engaged in a dental, medical or veterinary practice, and
which are licensed and/or qualified, as appropriate, in each
jurisdiction in which the nature of their practices would require such
license or qualification; PROVIDED, HOWEVER, that an Obligor of a
Receivable constituting a Non-Medical Contract shall not be required
to satisfy the conditions set forth in the preceding CLAUSES (A) and
(B); and
(xxix) with respect to which the other representations and
warranties contained in clauses (i), (ii), (iv) and (v) of SECTION
4.01(R) of the Purchase Agreement are true and correct in all material
respects and with respect to which all other representations and
warranties contained in such SECTION 4.01(r) are true and correct in
all material respects as of the date or dates therein made.
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"EQUIPMENT" means each item of equipment that is the subject of a
Contract, including all parts, accessions and modifications thereto and all
replacements thereof.
"ERISA" means the U.S. Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"ERISA AFFILIATE" means any (i) corporation which is a member of
the same controlled group of corporations (within the meaning of Section 414(b)
of the IRC) as the Seller; (ii) partnership or other trade or business (whether
or not incorporated) under common control (within the meaning of Section 414(c)
of the IRC) with the Seller or (iii) member of the same affiliated service group
(within the meaning of Section 414(m) of the IRC) as the Seller, any corporation
described in clause (i) above or any partnership or other trade or business
described in clause (ii) above.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that term
in Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"EURODOLLAR RATE" means for a Eurodollar Rate Advance and the
relevant Interest Period, an interest rate per annum equal to an interest rate
per annum determined by the Liquidity Agent equal to the quotient of (i) the
rate at which it would offer deposits in United States dollars to prime banks in
the London interbank market for a period equal to such Interest Period and in a
principal amount of not less than $1,000,000 at or about 11:00 A.M. (London
time) on the second Business Day before (and for value on) the first day of such
Interest Period, divided by, (ii) one minus the Eurodollar Reserve Percentage
(expressed as a decimal) applicable to the Liquidity Agent for that Interest
Period.
"EURODOLLAR RATE ADVANCE" means an Advance which bears interest
at a rate per annum calculated by reference to the Eurodollar Rate.
"EURODOLLAR RESERVE PERCENTAGE" of any Liquidity Bank for the
Interest Period for any Eurodollar Rate Advance means the reserve percentage
applicable during such Interest Period (or, if more than one such percentage
shall be so applicable, the daily average of such percentages for those days in
such Interest Period during which any such percentage shall be so applicable)
under regulations issued from time to time by the Board of Governors of the
Federal Reserve System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal reserve requirement) for such Liquidity Bank with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities having
a term equal to such Interest Period.
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"EVENT OF TERMINATION" has the meaning assigned to that term in
SECTION 7.01 of the Purchase Agreement.
"EXCESS CONCENTRATION RESERVE RATIO" means, on any day, a ratio
(expressed as a percentage) calculated as of the most recent Settlement Date in
accordance with the following formula:
ECRR = (MOB/DRB * 2) + [.10(1-[MOB/DRB * 2])]; where
ECRR = the Excess Concentration Reserve Ratio;
MOB = the largest Outstanding Balance of Eligible Receivables owed
by a single Obligor; and
DRB = the Discounted Eligible Receivables Balance;
PROVIDED, however, that if MOB/DRB less and equal 1.5%, the Excess Concentration
Reserve Ratio shall be zero.
"FACE AMOUNT" means (i) with respect to any Commercial Paper
issued on a discount basis, the face amount of any such Commercial Paper and
(ii) with respect to any Commercial Paper issued on an interest-bearing basis,
the sum of the principal amount thereof and the amount of all interest stated to
accrue thereon through the stated maturity date.
"FACILITY DOCUMENTS" means, collectively, the Purchase Agreement,
the Credit Agreement, the Triple-A Purchase Agreement, the Custodial Agreement,
the Lock-Box Agreements, the Insurance Agreement, and all other agreements,
documents and instruments delivered pursuant thereto or in connection therewith.
"FACILITY LIMIT" means, on any date of calculation, the amount
set forth in CLAUSE (I) of the definition of the "Facility Limit", as defined in
the Triple-A Purchase Agreement, MINUS the aggregate amount of "Capital"
outstanding thereunder on such date MINUS the aggregate principal amount of
Triple-A Loans under the Credit Agreement on such date.
"FEDERAL FUNDS RATE" means, for any day, a fluctuating interest
rate per annum equal to 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 next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations for such day for such transactions
received by the Liquidity Agent from three Federal funds brokers of recognized
standing selected by it.
"FEE LETTER" has the meaning assigned thereto on the first page
of this Definitions List.
"FINANCE AGREEMENT" means a written finance agreement
substantially in the form of EXHIBIT K-2 to the Purchase Agreement, together
with any Related Contract Documents that
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may be entered into in connection with such written finance agreement, pursuant
to which the Buyer finances an Obligor's purchase of equipment, leasehold
improvements and/or working capital needs.
"GAAP" means generally accepted accounting principles as in
effect from time to time and applied on a basis consistent with the audited
financial statements described in SECTION 4.01(e) of the Purchase Agreement.
"INDEBTEDNESS" of any Person means (i) indebtedness of such
Person for borrowed money, (ii) obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) obligations of such Person
to pay the deferred purchase price of property or services, (iv) obligations of
such Person as lessee under leases which shall have been or should be, in
accordance with GAAP, recorded as capital leases, (v) obligations secured by any
lien or other charge upon property or assets owned by such Person, even though
such Person has not assumed or become liable for the payment of such
obligations, (vi) obligations of such Person in connection with any letter of
credit issued for the account of such Person and (vii) obligations of such
Person under direct or indirect guaranties in respect of, and obligations
(contingent or otherwise) to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or obligations of
others of the kinds referred to in clauses (i) through (vi) above.
"INDEMNIFIED PARTY" has the meaning assigned to such term in
SECTION 8.01 of the Purchase Agreement.
"INSOLVENCY EVENT" means with respect to any Person, any of the
following events: such Person shall generally not pay its debts as such debts
become due or shall admit in writing its inability to pay its debts generally,
or shall make a general assignment for the benefit of creditors; or any case or
proceeding shall be instituted by or against such Person seeking to adjudicate
it a bankrupt or insolvent, or seeking liquidation, dissolution, winding up,
reorganization, arrangement, adjustment, protection, relief, or composition of
it or its debts under any law relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a receiver, trustee, or other similar official for it or
for any substantial part of its property.
"INSOLVENCY PROCEEDING" means any proceeding of the sort
described in the definition of Insolvency Event.
"INSURANCE AGREEMENT" has the meaning assigned thereto on the
first page of this Definitions List.
"INTEREST PAYMENT DATE" means, with respect to any Triple-A Loan,
the last day of the Interest Period then applicable to such Triple-A Loan.
"INTEREST PERIOD" means, with respect to any Triple-A Loan,
commencing on the date such Triple-A Loan is advanced until the Interest Payment
Date therefor, and thereafter commencing on the last day of the then existing
Interest Period for such Triple-A Loan until the
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next Interest Payment Date therefor, a period selected by the Administrative
Agent and notified to the Borrower in accordance with SECTION 2.03(b) of the
Credit Agreement. Such Interest Period shall be:
(i) if such Triple-A Loan is funded through the issuance of
Commercial Paper, a period of from 1 to 180 days;
(ii) if such Triple-A Loan is funded through Base Rate
Advances, a period of from 1 to 30 days;
(iii) if such Triple-A Loan is funded through Eurodollar
Rate Advances, a period of one, two or three months;
provided, however, that
(x) whenever the last day of an Interest Period would otherwise
occur on a day other than a Business Day, the last day of such
Interest period shall be extended to occur on the next succeeding
Business Day, unless such extension would cause the last day of an
Interest Period described in CLAUSE (iii) above to occur in the next
following calendar month, in which event the last day of such Interest
Period shall be deemed to occur on the immediately preceding Business
Day;
(y) whenever an Interest Period described in CLAUSE (iii) above
commences on the last Business Day in a month or on a date for which
there is no numerically corresponding day in the month in which such
Interest Period would otherwise end, the last day of such Interest
Period shall occur on the last Business Day of the month in which such
Interest Period ends; and
(z) no Interest Period described in CLAUSE (iii) above may end
later than the Scheduled Termination Date.
"INTEREST RATE HEDGE ASSIGNMENT" means an assignment in
substantially the form of EXHIBIT F to the Credit Agreement pursuant to which
the Borrower assigns to the Collateral Agent all of its rights to payment under
the Interest Rate Xxxxxx.
"INTEREST RATE XXXXXX" means interest rate swap or similar
agreements entered into by the Borrower and Triple-A with the Swap Provider to
provide protection to, or minimize the impact upon, the Borrower and Triple-A of
increasing interest rates under the Credit Agreement.
"IRC" means the Internal Revenue Code of 1986, as amended from
time to time, and any successor statute.
"IRS" means the Internal Revenue Service of the United States of
America.
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"ISSUING AND PAYING AGENT" means Bankers Trust Company, acting in
its capacity as the issuing and paying agent and depositary for the Commercial
Paper pursuant to that certain Depositary and Issuing and Paying Agency
Agreement dated as of February 25, 1994 among Triple-A, the Administrative Agent
and Bankers Trust Company, as the same may be amended, supplemented or otherwise
modified from time to time, and any successor to Bankers Trust Company under
such agreement.
"LEASE" means a lease agreement substantially in the form of
EXHIBIT K-1 to the Purchase Agreement, together with any Related Contract
Documents that may be entered into in connection with such lease agreement,
pursuant to which the Seller originally leased Equipment to such Obligor.
"LEASEHOLD IMPROVEMENT NOTE" means a note or instrument
substantially in the form of EXHIBIT K-3 to the Purchase Agreement, together
with any Related Contract Documents that may be entered into in connection with
such note or instrument, evidencing an Obligor's indebtedness to the Buyer on
account of a loan made to finance improvements to, or other costs incurred in
connection with the installation or maintenance of, Equipment.
"LIQUIDITY AGENT" means Banco Santander, in its capacity as the
agent for the Liquidity Banks under the Liquidity Agreement, or any successor
thereto.
"LIQUIDITY BANKS" means the financial institutions party to the
Liquidity Agreement as "Liquidity Banks" thereunder.
"LIQUIDITY AGREEMENT" means that certain Amended and Restated
Liquidity Agreement, dated as of June 29, 1998, as has been amended and as the
same may be amended, supplemented, restated, supplemented or otherwise modified
from time to time, by and among Triple-A, the Liquidity Banks party thereto and
the Liquidity Agent.
"LIQUIDITY SECURITY AGREEMENT" means that certain Liquidity
Security Agreement dated as of January 31, 1995, as has been amended and as the
same may be amended, restated, supplemented or otherwise modified from time to
time, by and among Triple-A, CapMAC and Banco Santander, in its capacity as the
Liquidity Agent and as "Liquidity Collateral Agent" under the Liquidity Security
Agreement.
"LOCK-BOX ACCOUNT" means an account maintained at a Lock-Box Bank
for the purpose of receiving Collections.
"LOCK-BOX AGREEMENT" means an agreement, in substantially the
form of EXHIBIT G to the Purchase Agreement, among the Seller, the Buyer and a
Lock-Box Bank which agreement sets forth the rights of the Collateral Agent, the
Seller, the Buyer and the Lock-Box Bank with respect to the disposition and
application of the Collections received into the applicable Lock-Box Account,
including, without limitation, the right of the Collateral Agent to direct the
Lock-Box Bank to remit all Collections of Transferred Assets directly to the
Collateral Agent.
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"LOCK-BOX BANK" means any of the banks holding one or more
lock-box accounts for receiving Collections from the Receivables.
"MULTIEMPLOYER PLAN" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA which is, or within the immediately preceding six
(6) years was, contributed to by either the Seller or any ERISA Affiliate.
"NON-MEDICAL CONTRACT" means a Contract the Obligor of which is
not required to be a licensed professional dental or medical practitioner.
"NOTICE OF ASSIGNMENT" means a Notice of Assignment in
substantially the form of EXHIBIT B to the Purchase Agreement.
"NOTICE OF BORROWING" has the meaning assigned to such term in
SECTION 2.03 of the Credit Agreement.
"OBLIGATIONS" means all present and future indebtedness and other
liabilities and obligations (howsoever created, arising or evidenced, whether
direct or indirect, absolute or contingent, or due or to become due) of the
Borrower to Triple-A, the Collateral Agent, the Administrative Agent, the Surety
and/or the Indemnified Parties, arising under or in connection with the Credit
Agreement, the Triple-A Note and the other Facility Documents (other than the
Triple-A Purchase Agreement) or the transactions contemplated thereby and shall
include, without limitation, all liability for principal of and interest on the
Triple-A Loans, closing fees, unused line fees, audit fees, expense
reimbursements, indemnifications, and other amounts due or to become due under
the Facility Documents, including, without limitation, interest, fees and other
obligations that accrue after the commencement of an Insolvency Proceeding (in
each case whether or not allowed as a claim in such Insolvency Proceeding).
"OBLIGOR" means each Person obligated to make payments under a
Contract.
"OTHER TAXES" has the meaning assigned to such term in SECTION
2.10(b) of the Credit Agreement.
"OUTSTANDING BALANCE" means, with respect to any Receivable at
any time, the Discounted Value of the remaining Scheduled Contract Payments
under the related Contract, as such amounts are adjusted as a result of any of
the events described in SECTION 2.05 of the Purchase Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation and any
Person succeeding to the functions thereof.
"PERMITTED ENCUMBRANCE" means any of the following:
(a) liens, charges or other encumbrances for taxes and other
governmental assessments which are not yet due and payable;
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(b) workers', mechanics', suppliers', carriers', warehousemen's,
landlords' liens and deposits, pledges or liens to secure statutory obligations,
surety or appeal bonds or other liens of like general nature incurred in the
ordinary course of business and not in connection with the borrowing of money,
PROVIDED in each case, the obligation secured is not overdue or, if overdue, is
being contested in good faith by appropriate actions or proceedings, and
PROVIDED, FURTHER, that such liens do not, in the reasonable opinion of the
Buyer, materially detract from the value of the Contract or the Equipment
subject thereto;
(c) liens, charges or encumbrances created in favor of the Buyer
pursuant to the Purchase Agreement or in favor of the Collateral Agent or
otherwise granted to Triple-A or to a Liquidity Bank in the Facility Documents;
or
(d) with respect to Equipment, liens thereon created in favor of the
Seller pursuant to a Contract and assigned to the Buyer pursuant to the Purchase
Agreement.
"PERMITTED EXTENSION" means an extension of a Scheduled Contract
Payment in the ordinary course of business for reasons unrelated to an Obligor's
creditworthiness for a period not to exceed 2 months.
"PERMITTED INVESTMENTS" means (i) securities issued or directly and
fully guaranteed or insured by the United States government or any agency or
instrumentality thereof having maturities on or before the first Settlement Date
after the date of acquisition; (ii) time deposits and certificates of deposit
having maturities on or before the first Settlement Date after the date of
acquisition, maintained with or issued by any commercial bank having capital and
surplus in excess of $500,000,000 and having the highest commercial paper rating
available by both Rating Agencies; (iii) money market funds which have the
highest applicable rating available by both Rating Agencies; (iv) repurchase
agreements having maturities on or before the first Settlement Date after the
date of acquisition for underlying securities of the types described in clauses
(i) and (ii) above or clause (v) below with any institution with the highest
long term debt rating and commercial paper rating available by both Rating
Agencies; and (v) commercial paper maturing on or before the first Settlement
Date after the date of acquisition and having the highest commercial paper
rating available by both Rating Agencies.
"PERSON" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, government (or any agency or political subdivision thereof) or other
entity.
"PLAN" means an employee benefit plan defined in Section 3(3) of ERISA
in respect of which the Seller or any ERISA Affiliate is, or within the
immediately preceding six years was, an "employer" as defined in Section 3(5) of
ERISA.
"PLEDGED ASSETS" means (i) at all times prior to the Termination Date,
(a) all then outstanding Pledged Receivables, (b) all Related Security relating
to such Pledged Receivables and (c) all Collections with respect to, and other
proceeds of, such Receivables and (ii) at all times on and after the Termination
Date, (a) all Pledged Receivables outstanding as of the close of business on the
day preceding the Termination Date (including any interest or finance charges
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accruing after the Termination Date which relate to any Pledged Receivables
outstanding as of the close of business on the day preceding the Termination
Date, (b) all Related Security relating to such Pledged Receivables and (c) all
Collections with respect to, and other proceeds of, such Receivables.
"PLEDGED RECEIVABLES" means all Receivables which are not Purchased
Receivables.
"POST OFFICE BOX" means each post office box to which Obligors are
directed to mail payments in respect of the Receivables.
"PRACTICE FINANCE LOAN" means a note or instrument substantially in
the form of EXHIBIT K-4 to the Purchase Agreement, together with any Related
Contract Documents that may be entered into in connection with such note or
instrument, evidencing an Obligor's indebtedness on account of a loan made to
finance working capital needs of such Obligor, in connection with such Obligor's
professional dental, medical or veterinary practice.
"PURCHASE" means a purchase (whether by means of cash payment or by
capital contribution) of Transferred Assets by the Buyer from the Seller
pursuant to SECTIONS 2.01 and 2.02 of the Purchase Agreement.
"PURCHASE AGREEMENT" has the meaning assigned thereto on the first
page of this Definitions List.
"PURCHASE DATE" means, with respect to any Purchase, the date on which
such purchase occurs.
"PURCHASE PRICE" means the purchase price payable for any Purchase as
calculated in SECTION 2.02(b) of the Purchase Agreement.
"PURCHASED RECEIVABLES" has the meaning assigned thereto in the
Triple-A Purchase Agreement.
"PURCHASED ASSETS" has the meaning assigned thereto in the Triple-A
Purchase Agreement.
"RATING AGENCIES" means, collectively, Standard & Poor's Corporation
and Xxxxx'x Investors Services, Inc., or their respective successors.
"RECEIVABLE" means all rights to payment arising under a Contract,
including, without limitation, (i) Contract Payments, (ii) Termination Payments
and (iii) Residual Realizations, together with all supplemental or additional
payments required by the terms of such Contract with respect to insurance,
maintenance, ancillary products and services and other specific charges.
"RECORDS" means all Contracts and other documents, books, records and
other information (including without limitation, computer programs, tapes,
discs, punch cards, data
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processing software and related property and rights) maintained with respect to
Contracts and the related Obligors.
"RELATED CONTRACT DOCUMENT" means any agreement or document
substantially in the form of EXHIBIT K-5 to the Purchase Agreement which may be
entered into contemporaneously with a Contract.
"RELATED SECURITY" means with respect to any Contract:
(xxxv) all security interests or liens and property subject
thereto from time to time purporting to secure payment of the
Receivables arising under such Contract, whether pursuant to such
Contract or otherwise;
(xxxvi) the assignment to the Buyer, of all UCC financing
statements covering any Equipment or covering any collateral securing
payment of the Receivable arising under such Contract;
(xxxvii) all guarantees, indemnities, warranties, letters of
credit, insurance policies and proceeds and premium refunds thereof
and other agreements or arrangements of whatever character from time
to time supporting or securing payment of the Receivables arising
under such Contract whether pursuant to the Contract related to such
Receivable or otherwise;
(xxxviii) all of the Seller's right, title and interest in, to
and under the Equipment related to such Contract, whether as an
ownership interest, as collateral security, or which was repossessed
from an Obligor of a Receivable to the extent that the Outstanding
Balance of such Receivable remains unpaid;
(xxxix) all Records; and
(xl) all Collections and other proceeds of the foregoing,
including, without limitation, all insurance and condemnation proceeds
and all security deposits related to the Equipment.
"REPORTABLE EVENT" means any of the events described in Section
4043 of ERISA.
"RESIDUAL REALIZATION" means, with respect to any Equipment, the
amount received or receivable by the Buyer or the Servicer upon the sale or
other disposition of the Equipment, whether from the Obligor upon the exercise
of any purchase option or from a sale or from insurance proceeds or otherwise.
"SCHEDULED CONTRACT PAYMENTS" means the Contract Payments due
under each Contract, as set forth in the appendix to EXHIBIT A of the Purchase
Agreement (including any supplement to such exhibit delivered under SECTION
2.02(b) thereof and also including any modification to such appendix as the
result of any modification, waiver or amendment to any Contract undertaken in
conformity with the Purchase Agreement), excluding, however, (i) in the
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case of any Contract which is not a Lease, starting with the final Contract
Payment owed thereunder and proceeding in reverse order of maturity, the
Contract Payments (or portions thereof) equal to any security deposit related to
such Contract and (ii) any Contract Payment that is due more than 72 months
(unless such Contract is a Contract that is permitted to come due in 84 months
under the definition of Eligible Receivables, in which case 84 months) after the
original commencement date of such Contract. The term "Scheduled Contract
Payment" does not include any Contract Payment which is payable in respect of
any Residual Realization or which otherwise reflects the residual value of the
related Equipment.
"SCHEDULED LIQUIDITY COMMITMENT TERMINATION DATE" has the meaning
assigned to that term in the Liquidity Agreement.
"SCHEDULED TERMINATION DATE" means June 29, 2003.
"SELLER" means HPSC, Inc., a Delaware corporation.
"SERVICER" has the meaning assigned to that term in SECTION 6.01 of
the Purchase Agreement.
"SERVICING FEE" has the meaning assigned to that term in SECTION 6.08
of the Purchase Agreement.
"SERVICING TERMINATION EVENT" means a failure on the part of the
Servicer to observe or perform any of its duties or obligations as Servicer
under the Purchase Agreement or as "Servicer" under the Triple-A Purchase
Agreement, as determined by the Collateral Agent in its reasonable judgment.
"SETTLEMENT DATE" means the 20th day of each month; PROVIDED, that if
in any month such day is not a Business Day, the "SETTLEMENT DATE" for such
month shall be the first Business Day to occur after such 20th day.
"SETTLEMENT REPORT" means a report, in substantially the form of
EXHIBIT C to the Purchase Agreement, furnished by the Seller to the Buyer
pursuant to SECTION 2.05(b) thereof.
"SUBSIDIARY" means, as to any Person, any corporation or other entity
of which securities or other ownership interests having ordinary voting power to
elect a majority of the Board of Directors or other Persons performing similar
functions are at the time directly or indirectly owned by such Person.
"SUCCESSOR SERVICER" means any Person which succeeds to the Seller as
the Servicer in accordance with the terms and provisions of the Purchase
Agreement and the Credit Agreement.
"SURETY" means CapMAC.
"SURETY BONDS" means the Surety Bonds for the benefit of Triple-A and
the Liquidity Banks to be issued by the Surety under the Insurance Agreement.
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"SWAP BOND" means that certain surety bond in favor of the
Swap Provider whereby CapMAC guarantees the payments to be made by the Borrower
under the Interest Rate Xxxxxx.
"SWAP PROVIDER" means Bank of Boston or such other financial
institution reasonably acceptable to CapMAC which enters into an Interest Rate
Hedge with the Borrower, PROVIDED that the Swap Provider must at all times be a
nationally recognized financial institution rated A or better by Standard &
Poor's Corporation or the equivalent by Xxxxx'x Investors Services, Inc.
"TAXES" has the meaning assigned to such term in SECTION 2.10(a) of
the Credit Agreement.
"TERMINATION AMOUNT" means, with respect to any Contract which has
been prepaid or otherwise terminated prior to its stated maturity or termination
date, an amount equal to the present value of the remaining Scheduled Contract
Payments, discounted to the date of prepayment or termination at the Discount
Rate, PLUS, any billed and uncollected amounts related to and amounts owing
under such Contract, including late charges and overdue interest charges, PLUS,
if such Contract is a Lease or Finance Agreement pursuant to which the Buyer
finances an Obligor's purchase of Equipment, the booked residual value of the
related Equipment, PLUS any processing fees charged to cover expenses.
"TERMINATION DATE" means the earliest of (i) that Business Day which
the Seller designates as the Termination Date by notice to the Buyer and the
Administrative Agent at least thirty calendar days prior to such Business Day,
(ii) that Business Day which the Buyer designates as the Termination Date by
notice to the Seller and the Administrative Agent at least thirty calendar days
prior to such Business Day, (iii) the date of the declaration or automatic
occurrence of the Termination Date pursuant to SECTION 7.01 of the Purchase
Agreement, SECTION 7.02 of the Credit Agreement or SECTION 7.02 of the Triple-A
Purchase Agreement, (iv) the Scheduled Liquidity Commitment Termination Date and
(v) the Scheduled Termination Date.
"TERMINATION PAYMENT" means any amount or amounts payable by an
Obligor upon termination or prepayment of a Contract prior to the payment of all
Contract Payments.
"TRANSFERRED ASSETS" means, at any time, the Receivables, the
Contracts, the Equipment, all Related Security with respect to the foregoing and
all Collections with respect to, and other proceeds of, the foregoing.
"TRIPLE-A" means Triple-A One Funding Corporation, a Delaware
corporation.
"TRIPLE-A LOAN" has the meaning assigned to such term in SECTION 2.01
of the Credit Agreement.
"TRIPLE-A NOTE" has the meaning assigned to such term in SECTION 2.02
of the Credit Agreement.
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"TRIPLE-A PURCHASE AGREEMENT" means the Amended and Restated Lease
Receivables Purchase Agreement, dated as of March 31, 2000, by and among HPSC
Bravo Funding Corp., a Delaware corporation, HPSC, Inc., a Delaware corporation,
Triple-A One Funding Corporation, a Delaware corporation, and Capital Markets
Assurance Corporation, a New York Stock insurance company, as the same may be
amended, restated, supplemented or otherwise modified from time to time.
"UCC" means the Uniform Commercial Code as from time to time in effect
in the State of New York, except that, with respect to the perfection or
priority of any security interest created under the UCC, the term "UCC" means
the Uniform Commercial Code as in effect in the jurisdiction whose law governs
the perfection and effect of perfection or non-perfection of such security
interest.
"UNMATURED EVENT OF TERMINATION" means any event which, with the
giving of notice or the passage of time or both, would constitute an Event of
Termination.
"UNMATURED WIND-DOWN EVENT" means any event which, with the giving of
notice or the passage of time or both, would constitute a Wind-Down Event.
"WEIGHTED AVERAGE REMAINING TERM" means the weighted average remaining
maturities of the Transferred Assets or the Pledged Assets, as the case may be,
calculated to equal (i) the aggregate amount of the remaining Scheduled Contract
Payments of each Receivable or Pledged Receivable, as the case may be, TIMES the
remaining term of such Receivable or Pledged Receivable, as the case may be,
DIVIDED BY (ii) the aggregate amount of the remaining Scheduled Contract
Payments of all the Receivables or Pledged Receivables, as the case may be,(each
such calculation to include, for purposes of calculating the Weighted Average
Remaining Term on any Settlement Date, any Receivables to be purchased on such
date).
"WIND-DOWN EVENT" has the meaning assigned to such term in SECTION
7.01 of the Credit Agreement.
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