RECEIVABLE INTEREST SALE AGREEMENT
Dated as of September 26, 2000
between
FERRELLGAS, L.P., as Originator,
and
FERRELLGAS RECEIVABLES, LLC, as Buyer
TABLE OF CONTENTS
Page
ARTICLE I.PURCHASE AND CONTRIBUTION...............................................................................1
Section 1.1 Contribution of Contributed Interest............................................................1
Section 1.2 Purchase of the Receivable Interest.............................................................2
Section 1.3 Payment of the Purchase Price...................................................................2
Section 1.4 Deemed Collections..............................................................................3
Section 1.5 Payments and Computations, Etc..................................................................3
Section 1.6 Intention of the Parties........................................................................3
ARTICLE II.PAYMENTS AND COLLECTIONS...............................................................................4
Section 2.1 Collections Prior to Termination................................................................4
Section 2.2 Collections Following Termination...............................................................4
Section 2.3 Payment Recission...............................................................................4
ARTICLE III.REPRESENTATIONS AND WARRANTIES........................................................................5
Section 3.1 Representations and Warranties of the Originator................................................5
(a) Existence and Power...................................................................................5
(b) Power and Authority; Due Authorization, Execution and Delivery........................................5
(c) No Conflict...........................................................................................5
(d) Governmental Authorization............................................................................5
(e) Actions, Suits........................................................................................5
(f) Binding Effect........................................................................................6
(g) Accuracy of Information...............................................................................6
(h) Use of Proceeds.......................................................................................6
(i) Good Title............................................................................................6
(j) Perfection............................................................................................6
(k) Places of Business and Locations of Records...........................................................6
(l) Material Adverse Effect...............................................................................7
(m) Names..............................................................................................7
(n) Ownership of Buyer....................................................................................7
(o) Not a Regulated Entity................................................................................7
(p) Compliance with Law...................................................................................7
(q) Compliance with Credit and Collection Policy..........................................................7
(r) Eligible Receivables..................................................................................7
(s) Payments to Originator................................................................................7
(t) Enforceability of Contracts...........................................................................8
(u) Accounting............................................................................................8
(v) Tax Status............................................................................................8
ARTICLE IV.CONDITIONS OF PURCHASE.................................................................................8
Section 4.1 Conditions Precedent to Purchase................................................................8
ARTICLE V.COVENANTS...............................................................................................8
Section 5.1 Financial Reporting.............................................................................8
(a) Originator's Annual Financial Statements..............................................................8
(b) Originator's Quarterly Financial Statements...........................................................9
(c) General Partner Annual Consolidated Statements........................................................9
Section 5.2 Certificates; Other Information.................................................................9
(a) Independent Auditor's Certificate.....................................................................9
(b) Compliance Certificate................................................................................9
(c) SEC Reports...........................................................................................9
(d) Other Information.....................................................................................9
Section 5.3 Notices........................................................................................10
Section 5.4 Compliance with Laws...........................................................................10
Section 5.5 Preservation of Existence, Etc.................................................................11
Section 5.6 Payment of Obligations.........................................................................11
Section 5.7 Audits.........................................................................................11
Section 5.8 Keeping of Records and Books...................................................................12
Section 5.9 Compliance with Contracts and Credit and Collection Policy.....................................12
Section 5.10 Ownership......................................................................................12
Section 5.11 Purchasers'Reliance............................................................................12
Section 5.12 Collections....................................................................................13
Section 5.13 Negative Covenants of Originator...............................................................13
(a) Name Change, Offices and Records.....................................................................13
(b) Change in Payment Instructions to Obligors...........................................................13
(c) Modifications to Contracts and Credit and Collection Policy..........................................13
(d) Sales, Adverse Claims................................................................................13
(e) Accounting for Purchase..............................................................................14
(f) Change in Business...................................................................................14
(g) Accounting Changes...................................................................................14
ARTICLE VI.ADMINISTRATION AND COLLECTION.........................................................................14
Section 6.1 Designation of Servicer........................................................................14
Section 6.2 Duties of Servicer.............................................................................14
Section 6.3 Servicing Fee..................................................................................15
ARTICLE VII.TERMINATION EVENTS...................................................................................15
Section 7.1 Termination Events.............................................................................15
(a) Non-Payment..........................................................................................15
(b) Representation or Warranty...........................................................................15
(c) Specific Defaults....................................................................................15
(d) Other Defaults.......................................................................................15
(e) Cross-Default........................................................................................15
(f) Insolvency; Voluntary Proceedings....................................................................16
(g) Involuntary Proceedings..............................................................................16
(h) ERISA................................................................................................17
(i) Monetary Judgments...................................................................................17
(j) Non-Monetary Judgments...............................................................................17
(l) Change of Control....................................................................................17
(m) Leverage Ratio....................................................................................17
(n) Interest Coverage Ratio..............................................................................17
(o) Excessive Contribution or Subordinated Note Balance..................................................17
Section 7.2 Remedies.......................................................................................18
ARTICLE VIII.INDEMNIFICATION.....................................................................................18
Section 8.1 Indemnities by Originator......................................................................18
Section 8.2 Other Costs and Expenses.......................................................................20
ARTICLE IX.MISCELLANEOUS.........................................................................................20
Section 9.1 Waivers and Amendments.........................................................................20
Section 9.2 Notices........................................................................................21
Section 9.3 Protection of Ownership Interests of Buyer.....................................................21
Section 9.4 Confidentiality................................................................................22
Section 9.5 Bankruptcy Petition............................................................................22
Section 9.6 Limitation of Liability........................................................................23
Section 9.7 CHOICE OF LAW..................................................................................23
Section 9.8 CONSENT TO JURISDICTION........................................................................23
Section 9.9 WAIVER OF JURY TRIAL...........................................................................24
Section 9.10 Integration; Binding Effect; Survival of Terms.................................................24
PAGE>
RECEIVABLE INTEREST SALE AGREEMENT
This Receivable Interest Sale Agreement dated as of September 26, 2000 is
between Ferrellgas, L.P., a Delaware limited partnership ("Originator"), and
Ferrellgas Receivables, LLC, a Delaware limited liability company ("Buyer").
Unless defined elsewhere herein, capitalized terms used in this Agreement shall
have the meanings assigned to such terms in Exhibit I.
PRELIMINARY STATEMENTS
On the terms and subject to the conditions hereinafter set forth,
Originator desires to sell a Receivable Interest,
and contribute a Contributed Interest to Buyer, and Buyer desires to
purchase such Receivable Interest, and accept the contribution of such
Contributed Interest, from Originator.
Originator and Buyer intend the transactions contemplated hereby to be a
true sale or other outright conveyance of the Receivable Interest and the
Contributed Interest from Originator to Buyer, providing Buyer with the full
benefits of ownership of the Receivable Interest and the Contributed Interest,
and Originator and Buyer do not intend these transactions to be, or for any
purpose to be characterized as, loans from Buyer to Originator.
From time to time after the date hereof, Buyer will sell undivided
interests in the Receivable Interest and the Contributed Interest pursuant to
that certain Receivables Purchase Agreement dated as of September 26, 2000 (as
the same may from time to time hereafter be amended, supplemented, restated or
otherwise modified, the "Purchase Agreement") among Buyer, as seller,
Originator, as initial Servicer, Jupiter Securitization Corporation ("Conduit"),
the financial institutions from time to time party thereto as "Financial
Institutions" (together with Conduit, the "Purchasers"), and Bank One, NA (Main
Office Chicago) or any successor agent appointed pursuant to the terms of the
Purchase Agreement, as agent for Conduit and such Financial Institutions (in
such capacity, the "Agent").
ARTICLE I.
PURCHASE AND CONTRIBUTION
Section 1.1 . Contribution of Contributed Interest. On the date hereof, in
consideration of the issuance of all of Buyer's Equity Interests, Originator
does hereby contribute, assign, transfer, set-over and otherwise convey to
Buyer, without recourse (except to the extent expressly provided herein), and
Buyer does hereby accept from Originator as a contribution to Buyer's capital,
the Contributed Interest. Subject to Section 7.1(o), after the date hereof
through and including the Termination Date, the Contributed Interest shall be
adjusted as of the opening of business on each Business Day on which any
adjustment in the Receivable Interest occurs as provided in Section 1.3(c).
Section 1.2 Purchase of the Receivable Interest. Upon the terms and subject to
the conditions hereof, in consideration of the Purchase Price, effective on the
date hereof, Originator does hereby sell, assign, transfer, set-over and
otherwise convey to Buyer, without recourse (except to the extent expressly
provided herein), and Buyer does hereby purchase from Originator, all of
Originator's right, title and interest in the Receivable Interest. The
Receivable Interest shall be adjusted as of the opening of business on each
Business Day after the date hereof through and including the Termination Date in
accordance with Section 1.3(c).
Section 1.3 Payment of the Purchase Price.
(a) On the date hereof, upon satisfaction of the conditions precedent set forth
in Article IV hereof, Buyer shall pay Originator the initial Purchase Price for
the Receivable Interest computed as of the Initial Computation Date, by (i)
deposit of immediately available funds, no later than 2:00 p.m. (Chicago time),
to Originator's account no. 4518054085 at Xxxxx Fargo Bank, N.A., in San
Francisco, California, ABA No. 000000000 ("Originator's Account"), and (ii)
delivering the Subordinated Note referred to in clause (b) below.
(b) A portion of the Purchase Price to be paid by the Buyer may from time to
time be paid to the Originator after the consummation of the sale of the
Receivable Interest. Such unpaid portion of the Purchase Price may be paid in
immediately available funds or, at Buyer's election, subject to Section 7.1(o),
by increasing the amount outstanding under the Subordinated Note.
(c) The Receivable Interest shall be adjusted on a daily basis because of the
daily changes that occur in respect of the Variable Purchased Percentage.
Notwithstanding such daily adjustments, the Buyer and the Originator agree that
the Buyer shall only be required to re-calculate the Variable Purchased
Percentage (i) on a monthly basis as of the last day of each calendar month (or
if such day is not a Business Day, the next succeeding Business Day), (ii) on
the date of the occurrence of any change in the Funded Amount in accordance with
clause (d) below, and (iii) on the Termination Date. Such redetermined amount of
the Variable Purchased Percentage shall be deemed to be the value of the
Receivable Interest for all purposes under this Agreement until such Receivable
Interest is redetermined pursuant to this clause (c).
(d) If the Funded Amount shall be increased or decreased on any date, the Buyer
shall (i) in the case of an increase in the Funded Amount, pay to the Originator
the proceeds received by it resulting from such increase as consideration for
the purchase of an additional portion of the Receivable Interest, and the
Receivable Interest shall be adjusted accordingly, and (ii) in the case of a
decrease in the Funded Amount, use the proceeds of Collections (and if necessary
to obtain additional proceeds, re-sell to the Originator a portion of the
Receivable Interest) to repay to the Agent for the account of the applicable
Purchaser(s), the amounts required to be repaid pursuant to the Purchase
Agreement, and the Receivable Interest shall be adjusted accordingly. In
addition, if the Variable Purchased Percentage would, but for the limitation
contained in the definition of such term, ever exceed 100%, the Buyer shall
repay to the Agent for the account of the applicable Purchaser(s), such amounts
as may be required to reduce the Variable Purchased Percentage to an amount
equal to or less than 100%.
Section 1.4 Deemed Collections.
(a) If on any day the Outstanding Balance of a Pool Receivable is either (i)
reduced as a result of any defective or rejected goods or services, any cash
discount or any adjustment by Originator, or (ii) reduced or cancelled as a
result of a setoff in respect of any claim by any Person (whether such claim
arises out of the same or a related transaction or an unrelated transaction),
Originator shall be deemed to have received on such day a Collection of such
Pool Receivable in the amount of such reduction or cancellation. If on any day
any of the representations or warranties in Section 3.1(h), (i), (j), (r) or (t)
is no longer true with respect to any Pool Receivable, Originator shall be
deemed to have received on such day a Collection of such Pool Receivable in
full.
(b) If Originator is deemed to receive Collections pursuant to this Section 1.4,
the Receivable Interest shall be adjusted accordingly on the date of such deemed
receipt pursuant to Section 1.3(c).
Section 1.5 Payments and Computations, Etc.
(a) All amounts to be paid or deposited by Buyer hereunder (except amounts
payable by increasing the outstanding principal balance under the Subordinated
Note) shall be paid or deposited to Originator's Account in accordance with the
terms hereof on the day when due in immediately available funds. All amounts to
be paid or deposited by Originator hereunder shall be paid or deposited to the
Facility Account in accordance with the terms hereof on the day when due in
immediately available funds.
(b) In the event that any payment owed by any Person hereunder becomes due on a
day that is not a Business Day, then such payment shall be made on the next
succeeding Business Day.
(c) If any Person fails to pay any amount hereunder when due, such Person agrees
to pay, on demand, the Default Fee in respect thereof until paid in full;
provided, however, that such Default Fee shall not at any time exceed the
maximum rate permitted by applicable law.
Section 1.6 Intention of the Parties. It is the intention of the parties hereto
that the contribution of the Contributed Interest, and the sale of the
Receivable Interest hereunder, shall constitute sales or other outright
conveyances which are absolute and irrevocable and provide Buyer with the full
benefits of ownership of the Contributed Interest and the Receivable Interest.
The sale of the Receivable Interest and contribution of the Contributed Interest
hereunder are made without recourse to Originator; provided, however, that (i)
Originator shall be liable to Buyer for all representations, warranties,
covenants and indemnities made by Originator pursuant to the terms of the
Transaction Documents to which Originator is a party, and (ii) such sale and
contribution do not constitute and are not intended to result in an assumption
by Buyer or any assignee thereof of any obligation of Originator or any other
Person arising in connection with the Pool Receivables, the related Contracts
and/or other Related Security or any other obligations of Originator. In view of
the intention of the parties hereto that the conveyances of the Receivable
Interest and the Contributed Interest made hereunder shall constitute sales or
other outright conveyances thereof rather than loans secured thereby, Originator
agrees that it will, on or prior to the date hereof, xxxx its master data
processing records relating to the Pool Receivables with a legend acceptable to
Buyer and to the Agent (as Buyer's assignee), evidencing that Buyer owns the
Receivable Interest and the Contributed Interest as provided in this Agreement
and to note in its financial statements that the Receivable Interest has been
sold, and the Contributed Interest has been contributed, to Buyer and have been
further sold or pledged to the Agent. Upon the request of Buyer or the Agent (as
Buyer's assignee), Originator 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 to perfect and
maintain the perfection of Buyer's ownership of the Receivable Interest and the
Contributed Interest, or as Buyer or the Agent (as Buyer's assignee) may
reasonably request.
ARTICLE II.
PAYMENTS AND COLLECTIONS
Section 2.1 Collections Prior to Termination. On each Business Day prior to the
Termination Date, after deduction by the Servicer of its Servicing Fee: (i) the
Originator's Percentage of any remaining Collections received by the Servicer on
such Business Day shall be deposited to the Originator's Account, and (ii) the
Buyer's Percentage then in effect of any remaining Collections received by the
Servicer shall be, at the Buyer's option, either applied to payment of any
amounts owing on such Business Day by Buyer to Originator in respect of the
Subordinated Note or deposited to the Facility Account and then transferred to
the Originator's Account as payment of the Purchase Price for the Receivable
Interest.
Section 2.2 Collections Following Termination. On the Termination Date and on
each day thereafter until payment in full of all Aggregate Unpaids, after
deduction of the Servicing Fee: (i) the Originator's Percentage then in effect
of any remaining Collections received by the Servicer on such Business Day shall
be deposited to the Originator's Account, and (ii) the Buyer's Percentage then
in effect of any remaining Collections received by the Servicer shall be
deposited to the Facility Account.
Section 2.3 Payment Recission. No amount due and owing to either party hereunder
shall be considered paid or applied hereunder to the extent that, at any time,
all or any portion of such payment or application is rescinded by application of
law or judicial authority, or must otherwise be returned or refunded for any
reason. The paying party shall remain obligated for the amount of any payment or
application so rescinded, returned or refunded, and shall promptly pay to the
Person who suffered such recission, return or refund) the full amount thereof,
plus interest thereon at the Default Fee from the date of any such recission,
return or refunding.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
Section 3.1 Representations and Warranties of the Originator. Originator hereby
represents and warrants to Buyer and its assigns, as of the date hereof and as
of each Business Day hereafter through and including the Termination Date that:
(a) Existence and Power. Originator is a limited partnership, duly organized,
validly existing and in good standing under the laws of Delaware, and is duly
qualified to do business and is in good standing as a foreign partnership, and
has and holds all partnership power and all governmental licenses,
authorizations, consents and approvals required to carry on its business in each
jurisdiction in which its business is conducted except where the failure to so
qualify or so hold could not reasonably be expected to have a Material Adverse
Effect.
(b) Power and Authority; Due Authorization, Execution and Delivery. The
execution and delivery by Originator of this Agreement and each other
Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder and, Originator's use of the proceeds of
the Purchase made hereunder, are within its partnership powers and authority and
have been duly authorized by all necessary partnership action on its part. This
Agreement and each other Transaction Document to which Originator is a party has
been duly executed and delivered by Originator.
(c) No Conflict. The execution and delivery by Originator of this Agreement and
each other Transaction Document to which it is a party, and the performance of
its obligations hereunder and thereunder do not contravene or violate (i) its
certificate of formation or partnership agreement, (ii) any law, rule or
regulation applicable to it, (iii) any restrictions under any agreement,
contract or instrument to which it is a party or by which it or any of its
property is bound, or (iv) any order, writ, judgment, award, injunction or
decree binding on or affecting it or its property, and do not result in the
creation or imposition of any Adverse Claim on assets of Originator or its
Subsidiaries (except as created under the Transaction Documents) except, in each
case, where such contravention or violation could not reasonably be expected to
have a Material Adverse Effect; and no transaction contemplated hereby requires
compliance with any bulk sales act or similar law.
(d) Governmental Authorization. Other than the filing of the financing
statements required hereunder, no authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution and delivery by Originator of this Agreement
and each other Transaction Document to which it is a party and the performance
of its obligations hereunder and thereunder.
(e) Actions, Suits. There are no actions, suits or proceedings pending, or to
the best of Originator's knowledge, threatened, against or affecting Originator,
or any of its properties, in or before any Governmental Authority, which (a)
purport to affect or pertain to this Agreement or any other Transaction Document
or any of the transactions contemplated hereby or thereby; or (b) if determined
adversely to Originator, would reasonably be expected to have a Material Adverse
Effect. No injunction, writ, temporary restraining order or any order of any
nature has been issued by any court or other Governmental Authority purporting
to enjoin or restrain the execution, delivery or performance of this Agreement
or any other Transaction Document, or directing that the transactions provided
for herein or therein not be consummated as herein or therein provided.
(f) Binding Effect. This Agreement and each other Transaction Document to which
Originator is a party constitute the legal, valid and binding obligations of
Originator enforceable against Originator in accordance with their respective
terms, except as such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws relating to or limiting
creditors' rights generally and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law).
(g) Accuracy of Information. All information heretofore furnished by Originator
or any of its Affiliates to Buyer (or its assigns) for purposes of or in
connection with this Agreement, any of the other Transaction Documents or any
transaction contemplated hereby or thereby is, and all such information
hereafter furnished by Originator or any of its Affiliates to Buyer (or its
assigns) will be, true and accurate in every material respect on the date such
information is stated or certified and does not and will not contain any untrue
statement of a material fact or omit any material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading as of the time when made
or delivered.
(h) Use of Proceeds. No Purchase Price payment hereunder will be used (i) for a
purpose that violates, or would be inconsistent with, any law, rule or
regulation applicable to Originator or (ii) to acquire any security in any
transaction which is subject to Section 13 or 14 of the Securities Exchange Act
of 1934, as amended. (i) Good Title. On the Initial Computation Date and upon
the creation of each Pool Receivable coming into existence after the Initial
Computation Date, Originator (i) is the legal and beneficial owner of the Pool
Receivables and (ii) is the legal and beneficial owner of the Collections and
Related Security with respect thereto, in each case, free and clear of any
Adverse Claim except as created by the Transaction Documents.
(j) Perfection. This Agreement, together with the filing of the financing
statements contemplated hereby, is effective to transfer to Buyer (and Buyer
shall acquire from Originator) legal and equitable title to, with the right to
sell and encumber, the Receivable Interest and the Contributed Interest, free
and clear of any Adverse Claim, except as created by the Transactions Documents.
There have been duly filed all financing statements or other similar instruments
or documents necessary under the UCC (or any comparable law) of all appropriate
jurisdictions to perfect Buyer's ownership of the Receivable Interest and the
Contributed Interest.
(k) Places of Business and Locations of Records. Originator is organized under
the laws of Delaware. The principal places of business and chief executive
office of Originator and the offices where it keeps all of its records regarding
the Receivable Interest are located at the address(es) listed on Exhibit II, or
such other locations of which Buyer has been notified in accordance with Section
5.13(a) in jurisdictions where all action required by Section 5.13(a) has been
taken and completed. Originator's Federal Employer Identification Number is
correctly set forth on Exhibit II.
(l) Material Adverse Effect. Since April 30, 2000, no event has occurred that
would have a Material Adverse Effect.
(m) Names. In the five (5) years prior to the date of this Agreement, Originator
has not used any partnership names, trade names or assumed names other than the
name in which it has executed this Agreement and as listed on Exhibit II.
(n) Ownership of Buyer. Originator owns, directly or indirectly, 100% of the
issued and outstanding Equity Interests of Buyer, free and clear of any Adverse
Claim. Such Equity Interests are validly issued, fully paid and nonassessable,
and there are no options, warrants or other rights to acquire securities of
Buyer.
(o) Not a Regulated Entity. Originator is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended, or any successor
statute. Originator is not subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act,
any state public utilities code, or any other Federal or state statute or
regulation limiting its ability to incur Indebtedness or to sell interests in
the Pool Receivables.
(p) Compliance with Law. Originator has complied with all applicable laws,
rules, regulations, orders, writs, judgments, injunctions, decrees or awards to
which it may be subject, except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect. Each Pool Receivable,
together with the Contract related thereto, does not contravene any laws, rules
or regulations applicable thereto (including, without limitation, laws, rules
and regulations relating to truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection practices and
privacy), and no part of such Contract is in violation of any such law, rule or
regulation, except where such contravention or violation could not reasonably be
expected to have a Material Adverse Effect.
(q) Compliance with Credit and Collection Policy. Originator has complied in all
material respects with the Credit and Collection Policy with regard to each Pool
Receivable and the related Contract, and has not made any change to such Credit
and Collection Policy, except such material change as to which Buyer (or its
assigns) has been notified in accordance with Section 5.13(a).
(r) Eligible Receivables. Each of the Receivables included as a Pool Receivable
in the Receivable Interest or the Contributed Interest on any day prior to the
Termination Date is an Eligible Receivable.
(s) Payments to Originator. Neither the sale by Originator of the Receivable
Interest, nor the contribution by Originator of the Contributed Interest, is
voidable under any section of the Federal Bankruptcy Code.
(t) Enforceability of Contracts. Each Contract with respect to each Pool
Receivable is effective to create, and has created, a legal, valid and binding
obligation of the related Obligor to pay the Outstanding Balance of the Pool
Receivable created thereunder and any accrued interest thereon, enforceable
against the Obligor in accordance with its terms, except as such enforcement may
be limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(u) Accounting. The manner in which Originator accounts for the sale of the
Receivable Interest and the contribution of the Contributed Interest does not
jeopardize its characterization as being a true sale or an absolute
contribution, as applicable.
(v) Tax Status. Originator is subject to taxation under the Code only as a
partnership and not as a corporation.
ARTICLE IV.
CONDITIONS OF PURCHASE
Section 4.1 Conditions Precedent to Purchase. The Purchase of the Receivable
Interest under this Agreement is subject to the conditions precedent that (a)
Buyer shall have been capitalized with the initial Contributed Interest, (b) the
Agent shall have received on or before the date of such purchase those documents
listed on Schedule A hereto, (c) all conditions precedent to the initial
purchase under the Purchase Agreement shall have been satisfied, (d) the
representations and warranties set forth in Section 3.1 are true and correct on
and as of the date of the Purchase, and (e) no event has occurred and is
continuing, or would result from the Purchase, that will constitute a
Termination Event, and no event has occurred and is continuing, or would result
from the Purchase, that would constitute a Potential Termination Event.
ARTICLE V.
COVENANTS
Section 5.1 Financial Reporting. Originator shall deliver to the Buyer and the
Agent (as Buyer's assignee), in form and detail satisfactory to the Buyer and
the Agent (as Buyer's assignee) and consistent with the form and detail of
financial statements and projections provided to the Buyer and the Agent (as
Buyer's assignee) by Originator and its Affiliates prior to the date of this
Agreement:
(a) Originator's Annual Financial Statements. As soon as available, but not
later than 100 days after the end of each fiscal year, a copy of the audited
consolidated balance sheet of Originator and its Subsidiaries as at the end of
such year and the related consolidated statements of income or operations,
partners' or shareholders' equity and cash flows for such year, setting forth in
each case in comparative form the figures for the previous fiscal year, and
accompanied by the opinion of a nationally-recognized independent public
accounting firm ("Independent Auditor") which report shall state that such
consolidated financial statements present fairly the financial position for the
periods indicated in conformity with GAAP applied on a basis consistent with
prior years. Such opinion shall not be qualified or limited in any manner,
including on account of any limitation on it because of a restricted or limited
examination by the Independent Auditor of any material portion of the
Originator's or any Subsidiary's records;
(b) Originator's Quarterly Financial Statements. As soon as available, but not
later than 45 days after the end of each of the first three fiscal quarters of
each fiscal year, a copy of the unaudited consolidated balance sheet of
Originator and its Subsidiaries as of the end of such quarter and the related
consolidated statements of income, partners' or shareholders' equity and cash
flows for the period commencing on the first day and ending on the last day of
such quarter, and certified by a Responsible Officer as fairly presenting, in
accordance with GAAP (subject to ordinary, good faith year-end audit
adjustments), the financial position and the results of operations of Originator
and the Subsidiaries; and
(c) General Partner Annual Consolidated Statements. As soon as available, but
not later than 100 days after the end of each fiscal year of the General
Partner, a copy of the unaudited (or audited, if available) consolidated balance
sheets of the General Partner as of the end of such fiscal year and the related
consolidated statements of income, shareholders' equity and cash flows for such
fiscal year, certified by a Responsible Officer as fairly presenting, in
accordance with GAAP, the financial position and the results of operations of
the General Partner and its Subsidiaries (or, if available, accompanied by an
opinion of an Independent Auditor as described in Section 5.1(a) above).
Section 5.2 Certificates; Other Information. Originator shall furnish to
the Buyer and the Agent (as Buyer's assignee):
(a) Independent Auditor's Certificate. Concurrently with the delivery of the
financial statements referred to in Section 5.1(a), a certificate of the
Independent Auditor stating that in making the examination necessary therefor no
knowledge was obtained of any Termination Event or Potential Termination Event,
except as specified in such certificate;
(b) Compliance Certificate. Concurrently with the delivery of the financial
statements referred to in Sections 5.1(a) and (b), a Compliance Certificate
executed by a Responsible Officer with respect to the periods covered by such
financial statements together with supporting calculations and such other
supporting detail as the Buyer and the Agent (as Buyer's assignee) shall
require;
(c) SEC Reports. Promptly, copies of all financial statements and reports that
the MLP sends to its partners, and copies of all financial statements and
regular, periodic or special reports (including Forms 10-K, 10-Q and 8-K) that
Originator or any Affiliate of Originator, the General Partner, the MLP or any
Subsidiary may make to, or file with, the SEC; and
(d) Other Information. Promptly, such additional information regarding the Pool
Receivables or the business, financial or corporate affairs of Originator, the
General Partner, the MLP or any Subsidiary as the Buyer or the Agent (as Buyer's
assignee) may from time to time request.
Section 5.3 Notices. Originator shall promptly notify the Buyer and the
Agent (as Buyer's assignee):
(a) Of the occurrence of any Potential Termination Event or Termination Event;
(b) Of any matter that has resulted or may reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Contractual Obligation of Originator, the General Partner, the
MLP or any Subsidiary; (ii) any dispute, litigation, investigation, proceeding
or suspension between Originator, the General Partner, the MLP or any Subsidiary
and any Governmental Authority; or (iii) the commencement of, or any material
development in, any litigation or proceeding affecting Originator, the General
Partner, the MLP or any Subsidiary, including pursuant to any applicable
Environmental Laws, in each case to the extent that any of the foregoing has
resulted or may reasonably be expected to result in a Material Adverse Effect;
(c) The occurrence of a default or an event of default under any other financing
arrangement pursuant to which Originator, the General Partner or the MLP is a
debtor or an obligor;
(d) From and after the time, if any, when either Standard and Poor's Ratings
Group or Xxxxx'x Investors Service, Inc. rates any Indebtedness of Originator,
any downgrade of which Originator becomes aware in the rating of any such
Indebtedness by either such rating agency, setting forth the Indebtedness
affected and the nature of such change;
(e) At least thirty (30) days prior to the effectiveness of any material change
in or material amendment to the Credit and Collection Policy, a copy of the
Credit and Collection Policy then in effect and a notice (A) indicating such
change or amendment, and (B) if such proposed change or amendment would be
reasonably likely to adversely affect the collectibility of the Pool Receivables
or decrease the credit quality of any newly created Pool Receivables, requesting
Buyer's consent thereto;
(f) Of any material change in accounting policies or financial reporting
practices by Originator or any of its consolidated Subsidiaries; and
(g) If any of the representations and warranties in Article III ceases to be
true and correct.
Each notice under this Section shall be accompanied by a written statement by a
Responsible Officer setting forth details of the occurrence referred to therein,
and stating what action Originator or any affected Affiliate proposes to take
with respect thereto and at what time. Each notice under Section 5.3(a) shall
describe with particularity any and all clauses or provisions of this Agreement
or other Transaction Document that have been breached or violated.
Section 5.4 Compliance with Laws. Originator shall comply with all Requirements
of Law of any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist or the
failure of which to comply with could not reasonably be expected to have a
Material Adverse Effect.
Section 5.5 Preservation of Existence, Etc. Originator shall:
(a) Preserve and maintain in full force and effect its partnership existence and
good standing under the laws of its state or jurisdiction of organization except
in connection with transactions permitted by the Credit Agreement;
(b) Preserve and maintain in full force and effect all governmental rights,
privileges, qualifications, permits, licenses and franchises necessary or
desirable in the normal conduct of its business except in connection with
transactions permitted by the Credit Agreement, or except where the failure to
so preserve or maintain such governmental rights, privileges, qualifications,
permits, licenses and franchises could not reasonably be expected to have a
Material Adverse Effect;
(c) Preserve its business organization and goodwill, except where the failure to
so preserve its business organization or goodwill could not reasonably be
expected to have a Material Adverse Effect; and
(d) Preserve or renew all of its registered patents, trademarks, trade names and
service marks, the non-preservation of which could reasonably be expected to
have a Material Adverse Effect.
Section 5.6 Payment of Obligations. Originator shall pay and discharge as the
same shall become due and payable (except to the extent the failure to so pay
and discharge could not reasonably be expected to have a Material Adverse
Effect), all of its obligations and liabilities, including:
(a) All tax liabilities, assessments and governmental charges or levies upon it
or its properties or assets, unless the same are being contested in good faith
by appropriate proceedings and adequate reserves in accordance with GAAP are
being maintained by Originator or such Subsidiary; and
(b) All lawful claims which, if unpaid, would by law become a Adverse Claim upon
its property, unless such claims are being contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP are being
maintained by Originator or such Subsidiary.
Section 5.7 Audits. Originator will furnish to Buyer (or its assigns) from time
to time such information with respect to it and the Pool Receivables as Buyer
(or its assigns) may reasonably request. Originator will, from time to time
during regular business hours as requested by Buyer (or its assigns), upon
reasonable notice and at the sole cost of Originator, permit Buyer (or its
assigns) or their respective agents or representatives (i) to examine and make
copies of and abstracts from all Records in the possession or under the control
of Originator relating to the Pool Receivables and the Related Security,
including, without limitation, the related Contracts, and (ii) to visit the
offices and properties of Originator for the purpose of examining such materials
described in clause (i) above, and to discuss matters relating to Originator's
financial condition or the Pool Receivables and the Related Security or
Originator's performance under any of the Transaction Documents or Originator's
performance under the Contracts and, in each case, with any of the officers or
employees of Originator having knowledge of such matters.
Section 5.8 Keeping of Records and Books. Originator will maintain and implement
administrative and operating procedures (including, without limitation, an
ability to recreate records evidencing Pool Receivables in the event of the
destruction of the originals thereof), and keep and maintain all documents,
books, records and other information reasonably necessary or advisable for the
collection of all Pool Receivables (including, without limitation, records
adequate to permit the immediate identification of each new Pool Receivable and
all Collections of and adjustments to each existing Pool Receivable). Originator
will give Buyer (or its assigns) notice of any material change in the
administrative and operating procedures referred to in the previous sentence.
Section 5.9 Compliance with Contracts and Credit and Collection Policy.
Originator will timely and fully (i) perform and comply with all provisions,
covenants and other promises required to be observed by it under the Contracts
related to the Pool Receivables, except where the failure to so comply could not
reasonably be expected to have a material adverse impact on the overall
collectibility of the Pool Receivables, and (ii) comply in all respects with the
Credit and Collection Policy in regard to each Pool Receivable and the related
Contract, except where the failure to so comply could not reasonably be expected
to have a material adverse impact on the overall collectibility of the Pool
Receivables.
Section 5.10 Ownership. Originator will take all necessary action to establish
and maintain, irrevocably in Buyer, legal and equitable title to the Receivable
Interest and the Contributed Interest, free and clear of any Adverse Claims
other than Adverse Claims arising under the Transaction Documents (including,
without limitation, the filing of all financing statements or other similar
instruments or documents necessary under the UCC (or any comparable law) of all
appropriate jurisdictions to perfect Buyer's interest in the Receivable Interest
and the Contributed Interest and such other action to perfect, protect or more
fully evidence the interest of Buyer as Buyer (or its assigns) may reasonably
request).
Section 5.11 Purchasers' Reliance. Originator acknowledges that the Agent and
the Purchasers are entering into the transactions contemplated by the Purchase
Agreement in reliance upon Buyer's identity as a legal entity that is separate
from Originator and any Affiliates thereof. Therefore, from and after the date
of execution and delivery of this Agreement, Originator will take all reasonable
steps including, without limitation, all steps that Buyer or any assignee of
Buyer may from time to time reasonably request to maintain Buyer's identity as a
separate legal entity and to make it manifest to third parties that Buyer is an
entity with assets and liabilities distinct from those of Originator and any
Affiliates thereof and not just a division of Originator or any such Affiliate.
Without limiting the generality of the foregoing and in addition to the other
covenants set forth herein, Originator (i) will not hold itself out to third
parties as liable for the debts of Buyer nor purport to own the Receivable
Interest or the Contributed Interest, (ii) will take all other actions necessary
on its part to ensure that Buyer is at all times in compliance with the
covenants set forth in Section 7.10 of the Purchase Agreement and (iii) will
cause all tax liabilities arising in connection with the transactions
contemplated herein or otherwise to be allocated between Originator and Buyer on
an arm's-length basis and in a manner consistent with the procedures set forth
in U.S. Treasury Regulations ss.ss.1.1502-33(d) and 1.1552-1.
Section 5.12 Collections. Originator, individually or as Servicer, will cause
all Collections on the Pool Receivables to be concentrated no less often than
weekly into the Servicer's Concentration Account; provided, however, that upon
written request of Buyer (or its assignee), Originator, individually or as
Servicer, will cause all such Collections to be concentrated each Business Day
into the Servicer's Concentration Account. Originator, individually or as
Servicer, will sweep the Buyer's Percentage of all such Collections from the
Servicer's Concentration Account no less than daily into the Facility Account
and, unless the Termination Date has occurred, immediately thereafter
transferred to the Originator's Account.
Section 5.13 Negative Covenants of Originator. Until the date on which this
Agreement terminates in accordance with its terms, Originator hereby covenants
that:
(a) Name Change, Offices and Records. Originator will not change its name,
identity or legal structure (within the meaning of Article 9 of any applicable
enactment of the UCC) or relocate its chief executive office or any office where
Records are kept unless it shall have: (i) given Buyer (or its assigns) at least
fifteen (15) days' prior written notice thereof and (ii) delivered to Buyer (or
its assigns) all financing statements, instruments and other documents requested
by Buyer (or its assigns) in connection with such change or relocation.
(b) Change in Payment Instructions to Obligors. Originator will not authorize
any Obligor to make payment to any Lock-Box or Collection Account (each, as
defined in the Purchase Agreement) other than one which is swept into the
Servicer's Concentration Account in accordance with Section 5.12.
(c) Modifications to Contracts and Credit and Collection Policy. Originator will
not make any change to the Credit and Collection Policy that could adversely
affect the collectibility of the Pool Receivables or decrease the credit quality
of any newly created Pool Receivables. Except as otherwise permitted in its
capacity as Servicer pursuant to Article VIII of the Purchase Agreement,
Originator will not extend, amend or otherwise modify the terms of any Pool
Receivable or any Contract related thereto other than in accordance with the
Credit and Collection Policy.
(d) Sales, Adverse Claims. Originator will not sell, assign (by operation of law
or otherwise) or otherwise dispose of, or grant any option with respect to, or
create or suffer to exist any Adverse Claim upon (including, without limitation,
the filing of any financing statement) or with respect to, the Receivable
Interest, the Contributed Interest, or the Servicer's Concentration Account, or
assign any right to receive income with respect thereto (other than, in each
case, the creation of the interests therein in favor of Buyer provided for
herein), and Originator will defend the right, title and interest of Buyer in,
to and under any of the foregoing property, against all claims of third parties
claiming through or under Originator.
(e) Accounting for Purchase. Originator will not, and will not permit any
Affiliate to, account for or treat (whether in financial statements or
otherwise) the transactions contemplated hereby in any manner other than the
sale of the Receivable Interest and a contribution of the Contributed Interest
by Originator to Buyer except to the extent that either such transaction is not
recognized on account of consolidated financial reporting in accordance with
generally accepted accounting principles.
(f) Change in Business. Originator shall not engage in any material line of
business substantially different from those lines of business carried on by
Originator and the Restricted Subsidiaries on the date of this Agreement.
(g) Accounting Changes. Originator shall not, and shall not suffer or permit any
Restricted Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
Originator or of any Restricted Subsidiary except as required by the Code.
ARTICLE VI.
ADMINISTRATION AND COLLECTION
Section 6.1 Designation of Servicer. The servicing, administration and
collection of the Pool Receivables shall be conducted by such Person (the
"Servicer") so designated from time to time in accordance with this Section 6.1.
Ferrellgas, L.P. is hereby designated as, and hereby agrees to perform the
duties and obligations of, the Servicer pursuant to the terms of this Agreement
and the Purchase Agreement. The Agent (as Buyer's assignee) may at any time
designate as Servicer any Person to succeed Ferrellgas, L.P. or any successor
Servicer; provided, however, that unless a Termination Event has occurred,
replacement of the Servicer shall not result in the occurrence of the
Termination Date.
Section 6.2 Duties of Servicer.
(a) The Servicer shall take or cause to be taken all such actions as may be
necessary or advisable to collect each Pool Receivable from time to time, all in
accordance with applicable laws, rules and regulations, with reasonable care and
diligence, and in accordance with the Credit and Collection Policy.
(b) The Servicer shall administer the Collections in accordance with the
procedures described in this Agreement and the Purchase Agreement.
(c) Any payment by an Obligor in respect of any indebtedness owed by it to
Originator shall, except as otherwise specified by such Obligor or otherwise
required by contract or law and unless otherwise instructed by the Agent, be
applied as a Collection of any Pool Receivable of such Obligor (starting with
the oldest such Pool Receivable) to the extent of any amounts then due and
payable thereunder before being applied to any other receivable or other
obligation of such Obligor.
Section 6.3 Servicing Fee. In consideration of Ferrellgas, L.P.'s agreement to
act as Servicer hereunder and under the Purchase Agreement, the parties hereby
agree that, so long as Ferrellgas, L.P. shall continue to perform as Servicer
hereunder and under the Purchase Agreement, as compensation for its servicing
activities, Ferrellgas, L.P. shall be entitled to a per annum fee (the
"Servicing Fee"), payable monthly in arrears on the 20th day of each month
hereafter (or, if any such date is not a Business Day, on the next succeeding
Business Day), determined between the Servicer and Buyer on an arms'-length
basis at a rate not to exceed 2.0% per annum of the average aggregate
Outstanding Balance of all Pool Receivables during the calendar month then most
recently ended (at any time while Ferrellgas, L.P. or one of its Affiliates is
acting as Servicer).
ARTICLE VII.
TERMINATION EVENTS
Section 7.1 Termination Events. The occurrence of any one or more of the
following events shall constitute a Termination Event:
(a) Non-Payment. Originator fails to pay, within 5 days after the same becomes
due, any interest, fee or any other amount payable under this Agreement or under
any other Transaction Document; or
(b) Representation or Warranty. Any representation or warranty by Originator
made or deemed made in this Agreement, in any other Transaction Document, or
which is contained in any certificate, document or financial or other statement
by Originator or any Responsible Officer furnished at any time under this
Agreement, or in or under any other Transaction Document, is incorrect in any
material respect on or as of the date made or deemed made; or
(c) Specific Defaults. Originator fails to perform or observe any term,
covenant or agreement contained in any of Section 5.3(a), 5.12 or 5.13; or
(d) Other Defaults. Originator fails to perform or observe any other term or
covenant contained in this Agreement or any other Transaction Document, and such
default shall continue unremedied for a period of 30 days after the earlier of
(i) the date upon which a Responsible Officer knew or reasonably should have
known of such failure or (ii) the date upon which written notice thereof is
given to Originator by Buyer or the Agent (as Buyer's assignee); or
(e) Cross-Default. (i) Any Event of Default under and as defined in the Credit
Agreement or the Synthetic Lease Documents shall occur and either (A) the
administrative agent thereunder accelerates the Indebtedness arising pursuant
thereto, or (B) the requisite lenders thereunder shall not have agreed in
writing to waive such Event of Default or to forbear from exercising their
remedies as a result thereof within 30 days after the occurrence thereof; or
(ii) Originator, the General Partner or any Restricted Subsidiary (A) fails to
make any payment in respect of any Indebtedness (other than Indebtedness arising
pursuant to the Credit Agreement), Synthetic Lease Obligation (other than one
arising under the Synthetic Lease Documents) or Contingent Obligation having an
aggregate principal amount (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated credit
arrangement) of more than $10,000,000 when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise) and such failure
continues after the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure; or (B) fails to perform or
observe any other condition or covenant, or any other event (including any
termination or similar event in respect of any Accounts Receivable
Securitization) shall occur or condition exist, under any agreement or
instrument relating to any such Indebtedness (other than Indebtedness pursuant
to the Credit Agreement), Synthetic Lease Obligation (other than one arising
under the Synthetic Lease Documents) or Contingent Obligation, and such failure
continues after the applicable grace or notice period, if any, specified in the
relevant document on the date of such failure if the effect of such failure,
event or condition is to cause, or to permit the holder or holders of such
Indebtedness or beneficiary or beneficiaries of such Indebtedness or such
Synthetic Lease Obligation (or a trustee or agent on behalf of such holder or
holders or beneficiary or beneficiaries) to cause such Indebtedness or such
Synthetic Lease Obligation to be declared to be due and payable prior to its
stated maturity or to cause such Indebtedness, Synthetic Lease Obligation or
Contingent Obligation to be prepaid, purchased or redeemed by Originator, the
General Partner or any Restricted Subsidiary, or such Contingent Obligation to
become payable or cash collateral in respect thereof to be demanded; or
(f) Insolvency; Voluntary Proceedings. The General Partner or Originator (i)
ceases or fails to be solvent, or generally fails to pay, or admits in writing
its inability to pay, its debts as they become due, subject to applicable grace
periods, if any, whether at stated maturity or otherwise; (ii) voluntarily
ceases to conduct its business in the ordinary course; (iii) commences any
Insolvency Proceeding with respect to itself; or (iv) takes any action to
effectuate or authorize any of the foregoing; or
(g) Involuntary Proceedings. (i) Any involuntary Insolvency Proceeding is
commenced or filed against the General Partner or Originator, or any writ,
judgment, warrant of attachment, execution or similar process, is issued or
levied against a substantial part of any such Person's properties, and any such
proceeding or petition shall not be dismissed, or such writ, judgment, warrant
of attachment, execution or similar process shall not be released, vacated or
fully bonded within 60 days after commencement, filing or levy; (ii) the General
Partner or Originator admits the material allegations of a petition against it
in any Insolvency Proceeding, or an order for relief (or similar order under
non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) the General
Partner or Originator acquiesces in the appointment of a receiver, trustee,
custodian, conservator, liquidator, mortgagee in possession (or agent therefor),
or other similar Person for itself or a substantial portion of its property or
business; or
(h) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan which has
resulted or could reasonably be expected to result in liability of Originator or
the General Partner under Title IV of ERISA to the Pension Plan or the PBGC in
an aggregate amount in excess of $10,000,000; or (ii) the commencement or
increase of contributions to, or the adoption of or the amendment of a Pension
Plan by Originator, the General Partner or any of their Affiliates which has
resulted or could reasonably be expected to result in an increase in Unfunded
Pension Liability among all Pension Plans in an aggregate amount in excess of
$10,000,000; or
(i) Monetary Judgments. One or more judgments, orders, decrees or arbitration
awards is entered against Originator or the General Partner involving in the
aggregate a liability (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage) as to any single or
related series of transactions, incidents or conditions, of more than
$10,000,000; or
(j) Non-Monetary Judgments. Any non-monetary judgment, order or decree is
entered against Originator or the General Partner which does or would reasonably
be expected to have a Material Adverse Effect, and there shall be any period of
60 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or
(k) Adverse Change. There occurs a Material Adverse Effect; or
(l) Change of Control. A Change of Control shall occur; or
(m) Leverage Ratio. Originator shall fail to maintain as of the last day of each
fiscal quarter a Leverage Ratio equal to or less than (i) 5.40 to 1.00 as of the
last day of each fiscal quarter ending after July 31, 2000 and on or prior to
January 31, 2001, and (ii) 4.90 to 1.00 as of the last day of each fiscal
quarter ending after January 31, 2001. For purposes of this Section 7.1(m), (x)
Funded Debt and Synthetic Lease Obligations shall be calculated as of the last
day of such fiscal quarter and (y) Consolidated Cash Flow shall be calculated
for the most recently ended four consecutive fiscal quarters, provided, however,
that prior to or concurrently with each delivery of a Compliance Certificate
pursuant to Section 5.2(b), Originator may elect to calculate Consolidated Cash
Flow for the most recently ended eight consecutive fiscal quarters (in which
case Consolidated Cash Flow shall be divided by two); or
(n) Interest Coverage Ratio. Originator shall fail to maintain, as of the last
day of each fiscal quarter of Originator, an Interest Coverage Ratio for the
fiscal period consisting of such fiscal quarter and the three immediately
preceding fiscal quarters of at least (i) 2.15 to 1.00 for each such period of
four fiscal quarters ending on or prior to January 31, 2001 and (ii) 2.40 to
1.00 each such period of four fiscal quarters ending after January 31, 2001; or
(o) Excessive Contribution or Subordinated Note Balance. The aggregate principal
amount outstanding under the Subordinated Note, plus (ii) the Contributed
Interest, plus (iii) all other Investments that are not Permitted Investments
(each, as defined in the Indenture dated as of April 26, 1996 among the MLP and
Ferrellgas Partners Finance Corp, as obligors, Originator, as guarantor, and
American Bank National Association, as trustee) exceeds $30,000,000 at any one
time outstanding.
Section 7.2 Remedies. Upon the occurrence and during the continuation of a
Termination Event, Buyer may take any of the following actions: (i) declare the
Termination Date to have occurred, whereupon the Termination Date shall
forthwith occur, without demand, protest or further notice of any kind, all of
which are hereby expressly waived by Originator; provided, however, that upon
the occurrence of a Termination Event described in Section 7.1(f) or (g), or of
an actual or deemed entry of an order for relief with respect to Originator
under the Federal Bankruptcy Code, the Termination Date shall automatically
occur, without demand, protest or any notice of any kind, all of which are
hereby expressly waived by Originator and (ii) to the fullest extent permitted
by applicable law, declare that the Default Fee shall accrue with respect to any
amounts then due and owing by Originator to Buyer. The aforementioned rights and
remedies shall be without limitation and shall be in addition to all other
rights and remedies of Buyer and its assigns otherwise available under any other
provision of this Agreement, by operation of law, at equity or otherwise, all of
which are hereby expressly preserved, including, without limitation, all rights
and remedies provided under the UCC, all of which rights shall be cumulative.
ARTICLE VIII.
INDEMNIFICATION
Section 8.1 Indemnities by Originator. Without limiting any other rights that
Buyer may have hereunder or under applicable law, Originator hereby agrees to
indemnify (and pay upon demand to) Buyer and its assigns, officers, directors,
agents and employees (each, an "Indemnified Party") from and against any and all
damages, losses, claims, taxes, liabilities, costs, expenses and for all other
amounts payable, including reasonable attorneys' fees (which attorneys may be
employees of Buyer or any such assign) and disbursements (all of the foregoing
being collectively referred to as "Indemnified Amounts") awarded against or
incurred by any of them arising out of or as a result of this Agreement or the
acquisition, either directly or indirectly, by Buyer of the Receivable Interest
and/or the Contributed Interest, excluding, however:
(a) Indemnified Amounts to the extent that a final judgment of
a court of competent jurisdiction holds that such Indemnified Amounts
resulted from gross negligence or willful misconduct on the part of the
Indemnified Party seeking indemnification;
(b) Indemnified Amounts to the extent the same includes losses
in respect of Pool Receivables that are uncollectible on account of the
insolvency, bankruptcy or lack of creditworthiness of the related
Obligor; or
(c) taxes imposed by the jurisdiction in which such
Indemnified Party's principal executive office is located, on or
measured by the overall net income of such Indemnified Party to the
extent that the computation of such taxes is consistent with the
characterization for income tax purposes of the acquisition by the
Purchasers of Purchaser Interests under the Purchase Agreement as a
loan or loans by the Purchasers to Buyer secured by, among other
things, the Receivable Interest and the Contributed Interest;
provided, however, that nothing contained in this sentence shall limit the
liability of Originator or limit the recourse of Buyer to Originator for amounts
otherwise specifically provided to be paid by Originator under the terms of this
Agreement. Without limiting the generality of the foregoing indemnification,
Originator shall indemnify Buyer for Indemnified Amounts (including, without
limitation, losses in respect of uncollectible Pool Receivables, regardless of
whether reimbursement therefor would constitute recourse to Originator) relating
to or resulting from:
(i) any representation or warranty made by Originator
(or any officers of Originator) under or in connection with
this Agreement, any other Transaction Document or any other
information or report delivered by Originator pursuant hereto
or thereto that shall have been false or incorrect when made
or deemed made;
(ii) the failure by Originator, to comply with any
applicable law, rule or regulation with respect to any Pool Receivable
or Contract related thereto, or the nonconformity of any Pool
Receivable or Contract included therein with any such applicable law,
rule or regulation or any failure of Originator to keep or perform any
of its obligations, express or implied, with respect to any Contract;
(iii) any failure of Originator to perform its
duties, covenants or other obligations in accordance with the
provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or
damage suit or other similar claim arising out of or in connection with
merchandise, insurance or services that are the subject of any Contract
or any Pool Receivable;
(v) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment
of any Pool Receivable (including, without limitation, a defense based
on such Pool Receivable or the related Contract not being a legal,
valid and binding obligation of such Obligor enforceable against it in
accordance with its terms), or any other claim resulting from the sale
of the merchandise or service related to such Pool Receivable or the
furnishing or failure to furnish such merchandise or services;
(vi) the commingling of Collections allocable to the
Receivable Interest or the Contributed Interest at any time with other
funds;
(vii) any investigation, litigation or proceeding
related to or arising from this Agreement or any other Transaction
Document, the transactions contemplated hereby, the use of the proceeds
of any Purchase Price payment, the ownership of the Receivable Interest
or the Contributed Interest or any other investigation, litigation or
proceeding relating to Originator in which any Indemnified Party
becomes involved as a result of any of the transactions contemplated
hereby;
(viii) any inability to litigate any claim against
any Obligor in respect of any Pool Receivable as a result of such
Obligor being immune from civil and commercial law and suit on the
grounds of sovereignty or otherwise from any legal action, suit or
proceeding;
(ix) any Termination Event described in Section 7.1(f) or (g);
(x) any failure to vest and maintain vested in Buyer,
or to transfer to Buyer, legal and equitable title to, and ownership
of, the Receivable Interest and the Contributed Interest free and clear
of any Adverse Claim;
(xi) the failure to have filed, or any delay in
filing, financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable laws
with respect to the Receivable Interest and the Contributed Interest,
and the proceeds of any thereof, whether at the time of the Purchase or
at any subsequent time;
(xii) any action or omission by Originator which
reduces or impairs the rights of Buyer with respect to any Pool
Receivable or the value of any such Pool Receivable; and
(xiii) any attempt by any Person to void the Purchase
hereunder under statutory provisions or common law or equitable action.
Section 8.2 Other Costs and Expenses. Originator shall pay all reasonable costs
and out-of-pocket expenses in connection with the preparation, execution and
delivery of this Agreement. Originator shall pay to Buyer on demand any and all
costs and expenses of Buyer, if any, including reasonable counsel fees and
expenses in connection with the enforcement of this Agreement and the other
documents delivered hereunder and in connection with any restructuring or
workout of this Agreement or such documents, or the administration of this
Agreement following a Termination Event.
ARTICLE IX.
MISCELLANEOUS
Section 9.1 Waivers and Amendments.
(a) No failure or delay on the part of Buyer (or its assigns) in exercising any
power, right or remedy under this Agreement shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power, right or remedy
preclude any other further exercise thereof or the exercise of any other power,
right or remedy. The rights and remedies herein provided shall be cumulative and
nonexclusive of any rights or remedies provided by law. Any waiver of this
Agreement shall be effective only in the specific instance and for the specific
purpose for which given.
(b) No provision of this Agreement or the Subordinated Note may be amended,
supplemented, modified or waived except in writing signed by Originator and
Buyer and, to the extent required under the Purchase Agreement, the Agent and
the Financial Institutions or the Required Financial Institutions.
Section 9.2 Notices. All communications and notices provided for hereunder shall
be in writing (including bank wire, telecopy or electronic facsimile
transmission or similar writing) and shall be given to the other parties hereto
at their respective addresses or telecopy numbers set forth on the signature
pages hereof or at such other address or telecopy number as such Person may
hereafter specify for the purpose of notice to the other party hereto. Each such
notice or other communication shall be effective (a) if given by telecopy, upon
the receipt thereof, (b) if given by mail, three (3) Business Days after the
time such communication is deposited in the mail with first class postage
prepaid or (c) if given by any other means, when received at the address
specified in this Section 7.2.
Section 9.3 Protection of Ownership Interests of Buyer.
(a) Originator agrees that from time to time, at its expense, it will promptly
execute and deliver all instruments and documents, and take all actions, that
may be necessary or desirable, or that Buyer (or its assigns) may request, to
perfect, protect or more fully evidence the interest of Buyer hereunder and the
Receivable Interest and the Contributed Interest, or to enable Buyer (or its
assigns) to exercise and enforce their rights and remedies hereunder. At any
time, Buyer (or its assigns) may, at Originator's sole cost and expense, direct
Originator to notify the Obligors of Pool Receivables of the ownership interests
of Buyer under this Agreement and may also, at any time after the occurrence and
continuation of a Termination Event, direct that payments of all amounts due or
that become due under any or all Pool Receivables be made directly to Buyer or
its designee.
(b) If Originator fails to perform any of its obligations hereunder, Buyer (or
its assigns) may (but shall not be required to) perform, or cause performance
of, such obligations, and Buyer's (or such assigns') costs and expenses incurred
in connection therewith shall be payable by Originator as provided in Section
6.2. Originator irrevocably authorizes Buyer (and its assigns) at any time and
from time to time in the sole discretion of Buyer (or its assigns), and appoints
Buyer (and its assigns) as its attorney(ies)-in-fact, to act on behalf of
Originator (i) to, after the occurrence and continuance of a Termination Event
execute on behalf of Originator as debtor and to file financing statements
necessary or desirable in Buyer's (or its assigns') sole discretion to perfect
and to maintain the perfection and priority of the interest of Buyer in the Pool
Receivables and (ii) after the occurrence and continuance of a Termination
Event, to file a carbon, photographic or other reproduction of this Agreement or
any financing statement with respect to the Receivable Interest and the
Contributed Interest as a financing statement in such offices as Buyer (or its
assigns) in their sole discretion deem necessary or desirable to perfect and to
maintain the perfection and priority of Buyer's interest in the Receivable
Interest and the Contributed Interest. This appointment is coupled with an
interest and is irrevocable.
Section 9.4 Confidentiality.
(a) Originator shall maintain and shall cause each of its employees and officers
to maintain the confidentiality of the Fee Letter and the other confidential or
proprietary information with respect to the Agent and Conduit and their
respective businesses obtained by it or them in connection with the structuring,
negotiating and execution of the transactions contemplated herein, except that
Originator and its officers and employees may disclose such information to
Originator's external accountants and attorneys and as required by any
applicable law or order of any judicial or administrative proceeding.
(b) Originator hereby consents to the disclosure of any nonpublic information
with respect to it (i) to Buyer, the Agent, the Financial Institutions or
Conduit, (ii) to any prospective or actual assignee or participant of any of the
Persons described in clause (i), (iii) to any rating agency, Commercial Paper
dealer or provider of a surety, guaranty or credit or liquidity enhancement to
Conduit or any entity organized for the purpose of purchasing, or making loans
secured by, financial assets for which Bank One acts as the administrative agent
and (iv) to any officers, directors, employees, outside accountants and
attorneys of any of the foregoing, provided each such Person is informed of the
confidential nature of such information and, in the case of a Person described
in clause (ii), agrees in writing to keep such information confidential. In
addition, the Purchasers and the Agent may disclose any such nonpublic
information pursuant to any law, rule, regulation, direction, request or order
of any judicial, administrative or regulatory authority or proceedings (whether
or not having the force or effect of law).
(c) Buyer shall maintain and shall cause each of its employees and officers to
maintain the confidentiality of the confidential or proprietary information with
respect to Originator, the Obligors and their respective businesses obtained by
it in connection with the due diligence evaluations, structuring, negotiating
and execution of the Transaction Documents, and the consummation of the
transactions contemplated herein and any other activities of Buyer arising from
or related to the transactions contemplated herein provided, however, that each
of Buyer and its employees and officers shall be permitted to disclose such
confidential or proprietary information: (i) to the Persons described in clause
(b) above, and (ii) to the extent required pursuant to any applicable law, rule,
regulation, direction, request or order of any judicial, administrative or
regulatory authority or proceedings with competent jurisdiction (whether or not
having the force or effect of law) so long as such required disclosure is made
under seal to the extent permitted by applicable law or by rule of court or
other applicable body.
Section 9.5 Bankruptcy Petition. (a) Originator and Buyer each hereby covenants
and agrees that, prior to the date that is one year and one day after the
payment in full of all outstanding senior indebtedness of Conduit, it will not
institute against, or join any other Person in instituting against Conduit any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other similar proceeding under the laws of the United States or any state of
the United States.
(b) Originator covenants and agrees that, prior to the date
that is one year and one day after the payment in full of all outstanding
obligations of Buyer under the Purchase Agreement, it will not institute
against, or join any other Person in instituting against, Buyer any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceeding under the laws of the United States or any state of the
United States.
Section 9.6 Limitation of Liability. Except with respect to any claim arising
out of the willful misconduct or gross negligence of Conduit, the Agent or any
Financial Institution, no claim may be made by Originator or any other Person
against Conduit, the Agent or any Financial Institution or their respective
Affiliates, directors, officers, employees, attorneys or agents for any special,
indirect, consequential or punitive damages in respect of any claim for breach
of contract or any other theory of liability arising out of or related to the
transactions contemplated by this Agreement, or any act, omission or event
occurring in connection therewith; and Originator hereby waives, releases, and
agrees not to xxx upon any claim for any such damages, whether or not accrued
and whether or not known or suspected to exist in its favor.
Section 9.7 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, without regard to the principles
of conflicts of laws thereof (except in the case of the other Transaction
Documents, to the extent otherwise expressly stated therein) AND EXCEPT TO THE
EXTENT THAT THE PERFECTION OF THE OWNERSHIP INTERESTS OR SECURITY INTERESTS OF
BUYER OR THE AGENT IN THE RECEIVABLE INTEREST AND THE CONTRIBUTED INTEREST IS
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF texas.
Section 9.8 CONSENT TO JURISDICTION. NOTWITHSTANDING THE CHOICE OF TEXAS LAW
PURSUANT TO SECTION 9.7, ORIGINATOR HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT
SITTING IN NEW YORK COUNTY, NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY ORIGINATOR PURSUANT TO
THIS AGREEMENT AND ORIGINATOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF
BUYER (OR ITS ASSIGNS) TO BRING PROCEEDINGS AGAINST ORIGINATOR IN THE COURTS OF
ANY OTHER JURISDICTION.
Section 9.9 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES TRIAL BY JURY
IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY
ORIGINATOR PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED HEREUNDER
OR THEREUNDER.
Section 9.10 Integration; Binding Effect; Survival of Terms.
(a) This Agreement and each other Transaction Document contain the final and
complete integration of all prior expressions by the parties hereto with respect
to the subject matter hereof and shall constitute the entire agreement among the
parties hereto with respect to the subject matter hereof superseding all prior
oral or written understandings.
(b) This Agreement shall be binding upon and inure to the benefit of Originator,
Buyer and their respective successors and permitted assigns (including any
trustee in bankruptcy). Originator may not assign any of its rights and
obligations hereunder or any interest herein without the prior written consent
of Buyer. Buyer may assign at any time its rights and obligations hereunder and
interests herein to any other Person without the consent of Originator. Without
limiting the foregoing, Originator acknowledges that Buyer, pursuant to the
Purchase Agreement, may assign to the Agent, for the benefit of the Purchasers,
its rights, remedies, powers and privileges hereunder and that the Agent may
further assign such rights, remedies, powers and privileges to the extent
permitted in the Purchase Agreement. Originator agrees that the Agent, as the
assignee of Buyer, shall, subject to the terms of the Purchase Agreement, have
the right to enforce this Agreement and to exercise directly all of Buyer's
rights and remedies under this Agreement (including, without limitation, the
right to give or withhold any consents or approvals of Buyer to be given or
withheld hereunder) and Originator agrees to cooperate fully with the Agent in
the exercise of such rights and remedies. This Agreement shall create and
constitute the continuing obligations of the parties hereto in accordance with
its terms and shall remain in full force and effect until terminated in
accordance with its terms; provided, however, that the rights and remedies with
respect to (i) any breach of any representation and warranty made by Originator
pursuant to Article II; (ii) the indemnification and payment provisions of
Article VIII; and (iii) Section 9.5 shall be continuing and shall survive any
termination of this Agreement.
Section 9.11 Counterparts; Severability; Section References. This Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Unless otherwise expressly indicated, all references herein
to "Article," "Section," "Schedule" or "Exhibit" shall mean articles and
sections of, and schedules and exhibits to, this Agreement.
IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be executed and delivered by their
duly
authorized officers as of the date hereof.
FERRELLGAS, L.P.
By: Ferrellgas, Inc., its General Partner
By:
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
Address:
Ferrellgas, L.P.
Xxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
FERRELLGAS RECEIVABLES, LLC
By:
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
Address:
One Xxxxx Center
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
(a)
EXHIBIT I
DEFINITIONS
This is Exhibit I to the Agreement (as hereinafter defined).
As used in the Agreement and the Exhibits, Schedules and Annexes thereto,
capitalized terms have the meanings set forth in this Exhibit I (such meanings
to be equally applicable to the singular and plural forms thereof). If a
capitalized term is used in the Agreement, or any Exhibit, Schedule or Annex
thereto, and not otherwise defined therein or in this Exhibit I, such term shall
have the meaning assigned thereto in Exhibit I to the Purchase Agreement.
"Acquisition" means any transaction or series of related
transactions for the purpose of or resulting, directly or indirectly, in (a) the
acquisition of all or substantially all of the assets of a Person, or of any
business or division of a Person, (b) the acquisition of in excess of 50% of the
capital stock, partnership interests or equity of any Person or otherwise
causing any Person, to become a Subsidiary of the acquiring Person, or (c) a
merger or consolidation or any other combination with another Person (other than
a Person that is a Subsidiary of the acquiring Person) provided that Originator
or the Subsidiary of the acquiring entity is the surviving Person.
"Adjusted Pool Amount" means, on any date of determination, an
amount to equal to the quotient of the Funded Amount divided by 0.80.
"Adverse Claim" means any security interest, mortgage, deed of
trust, pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of any kind
or nature whatsoever in respect of any property (including those created by,
arising under or evidenced by any conditional sale or other title retention
agreement, the interest of a lessor under a capital lease, any financing lease
having substantially the same economic effect as any of the foregoing, or the
filing of any financing statement naming the owner of the asset to which such
lien relates as debtor, under the UCC or any comparable law) and any contingent
or other agreement to provide any of the foregoing, but not including the
interest of a lessor under an operating lease.
"Affiliate" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person. A Person shall be deemed to control another Person if
the controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, by contract, or otherwise.
"Agent" has the meaning set forth in the Preliminary Statements to the
Agreement.
"Aggregate Unpaids" has the meaning set forth in the Purchase Agreement.
"Agreement" means the Receivable Interest Sale Agreement,
dated as of September 26, 2000, between Originator and Buyer, as the same may be
amended, restated or otherwise modified.
"Asset Sale" has the meaning specified in the CreditAgreement.
"Business Day" means any day on which banks are not authorized
or required to close in New York, New York or Chicago, Illinois and The
Depository Trust Company of New York is open for business.
"Buyer" has the meaning set forth in the preamble to the Agreement.
"Buyer's Percentage" means, on any date of determination, the
sum of the Variable Purchased Percentage plus the Variable Contributed
Percentage.
"Calculation Period" means (a) the period beginning on the
date hereof and ending on October 20, 2000, and (b) thereafter, each period
beginning on a Settlement Date and ending on the day preceding the next
succeeding Settlement Date.
"Capital Interests" means (a) with respect to any corporation,
any and all shares, participations, rights or other equivalent interests in the
capital of the corporation, (b) with respect to any partnership or limited
liability company, any and all partnership interests (whether general or
limited) or limited liability company interests, respectively, and other
interests or participations that confer on a Person the right to receive a share
of the profits and losses of, or distributions of assets of, such partnership or
limited liability company, and (c) with respect to any other Person, ownership
interests of any type in such Person.
"Capital Lease Obligation" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at such time be so required to be capitalized on the
balance sheet in accordance with GAAP.
"Change of Control" means (a) the sale, lease, conveyance or
other disposition of all or substantially all of the Originator's assets to any
Person or group (as such term is used in Section 13(d)(3) of the Exchange Act)
other than Xxxxx X. Xxxxxxx, the Related Parties and any Person of which Xxxxx
X. Xxxxxxx and the Related Parties beneficially own in the aggregate 51% or more
of the voting Capital Interests (or if such Person is a partnership, 51% or more
of the general partner interests), (b) the liquidation or dissolution of
Originator or the General Partner, and/or (c) the occurrence of any transaction,
the result of which is that Xxxxx X. Xxxxxxx and the Related Parties
beneficially own in the aggregate, directly or indirectly, less than 51% of the
total voting power entitled to vote for the election of directors of the General
Partner.
"Charged-Off Receivable" means a Receivable: (i) as to which
the Obligor thereof has taken any action, or suffered any event to occur, of the
type described in Section 7.1(f) or (g) (as if references to the Originator
therein refer to such Obligor); (ii) as to which the Obligor thereof, if a
natural person, is deceased, (iii) which, consistent with the Credit and
Collection Policy, would be written off the Originator's books as uncollectible,
or (iv) which has been identified by the Originator, Buyer or Servicer as
uncollectible.
"Code" means the Internal Revenue Code of 1986, as amended,
and regulations promulgated thereunder.
"Collections" means, with respect to any Pool Receivable, all
cash collections and other cash proceeds in respect of such Pool Receivable,
including, without limitation, all Finance Charges or other related amounts
accruing in respect thereof and all cash proceeds of Related Security with
respect to such Pool Receivable.
"Compliance Certificate" means a certificate in the form of
Exhibit III hereto duly executed by a Responsible Officer of Originator.
"Conduit" has the meaning set forth in the Preliminary Statements to the
Agreement.
"Consolidated Cash Flow" means, with respect to Originator and
the Restricted Subsidiaries for any period, the Consolidated Net Income for such
period, plus (a) an amount equal to any extraordinary loss plus any net loss
realized in connection with an asset sale, to the extent such losses were
deducted in computing Consolidated Net Income, plus (b) provision for taxes
based on income or profits of Originator and the Restricted Subsidiaries for
such period, to the extent such provision for taxes was deducted in computing
Consolidated Net Income, plus (c) Consolidated Interest Expense for such period,
whether paid or accrued (including amortization of original issue discount,
non-cash interest payments and the interest component of any payments associated
with Capital Lease Obligations and net payments (if any) pursuant to Hedging
Obligations), to the extent such expense was deducted in computing Consolidated
Net Income, plus (d) depreciation and amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid cash
expenses that were paid in a prior period) of Originator and the Restricted
Subsidiaries for such period, to the extent such depreciation and amortization
were deducted in computing Consolidated Net Income, plus (e) non-cash employee
compensation expenses of Originator and the Restricted Subsidiaries for such
period, plus (f) the Synthetic Lease Principal Component of Originator and the
Restricted Subsidiaries for such period; in each case, for such period without
duplication on a consolidated basis and determined in accordance with GAAP.
"Consolidated Interest Expense" means, with respect to
Originator and the Restricted Subsidiaries for any fiscal period, on a
consolidated basis, the sum of (a) all interest, fees (including Letter of
Credit fees), charges and related expenses paid or payable (without duplication)
by Originator and the Restricted Subsidiaries for that fiscal period to the
Banks hereunder or to any other lender in connection with borrowed money or the
deferred purchase price of assets that are considered "interest expense" under
GAAP, plus (b) the portion of rent paid or payable (without duplication) by
Originator and the Restricted Subsidiaries for that fiscal period under Capital
Lease Obligations that should be treated as interest in accordance with
Financial Accounting Standards Board Statement No. 13, on a consolidated basis,
plus (c) the Synthetic Lease Interest Component of Originator and the Restricted
Subsidiaries for that fiscal period.
"Consolidated Net Income" means, with respect to Originator
and the Restricted Subsidiaries for any period, the aggregate of the Net Income
of Originator and the Restricted Subsidiaries for such period, on a consolidated
basis, determined in accordance with GAAP; provided, that (a) the Net Income of
any Person that is not a Restricted Subsidiary or that is accounted for by the
equity method of accounting shall be included only to the extent of the amount
of dividends or distributions paid to Originator or a Wholly-Owned Subsidiary of
the Originator, (b) the Net Income of any Person that is a Restricted Subsidiary
(other than a Wholly-Owned Subsidiary) shall be included only to the extent of
the amount of dividends or distributions paid to Originator or a Wholly-Owned
Subsidiary of the Originator, (c) the Net Income of any Person acquired in a
pooling of interests transaction for any period prior to the date of such
acquisition shall be excluded except to the extent otherwise includable under
clause (a) above and (d) the cumulative effect of a change in accounting
principles shall be excluded.
"Contingent Obligation" means, as to any Person, any direct or
indirect liability of that Person, whether or not contingent, with or without
recourse: (a) with respect to any Indebtedness, lease, dividend, distribution,
letter of credit or other obligation (the "primary obligations") of another
Person (the "primary obligor"), including any obligation of that Person (i) to
purchase, repurchase or otherwise acquire such primary obligations or any
security therefor, (ii) to advance or provide funds for the payment or discharge
of any such primary obligation, or to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary
obligor, (iii) to purchase property, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation, or (iv)
otherwise to assure or hold harmless the holder of any such primary obligation
against loss in respect thereof (each, a "Guaranty Obligation"); (b) with
respect to any Surety Instrument (other than any Letter of Credit) issued for
the account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings or payments; (c) to purchase any materials, supplies
or other property from, or to obtain the services of, another Person if the
relevant contract or other related document or obligation requires that payment
for such materials, supplies or other property, or for such services, shall be
made regardless of whether delivery of such materials, supplies or other
property is ever made or tendered, or such services are ever performed or
tendered; or (d) in respect of any Hedging Obligation. The amount of any
Contingent Obligation shall, in the case of Guaranty Obligations, be deemed
equal to the stated or determinable amount of the primary obligation in respect
of which such Guaranty Obligation is made or, if not stated or if
indeterminable, the maximum reasonably anticipated liability in respect thereof,
and in the case of other Contingent Obligations, shall be equal to the maximum
reasonably anticipated liability in respect thereof.
"Contract" means, with respect to any Pool Receivable, any and
all instruments, agreements, invoices or other writings pursuant to which such
Pool Receivable arises or which evidences such Pool Receivable.
"Contractual Obligation" means, as to any Person, any
provision of any security issued by such Person or of any agreement,
undertaking, contract, indenture, mortgage, deed of trust or other instrument,
document or agreement to which such Person is a party or by which it or any of
its property is bound.
"Contributed Interest" means a specified dollar amount of Pool
Receivables which equates to a variable undivided percentage interest (less than
or equal to 100%) in and to the Pool Receivables, the associated Related
Security and Collections and all proceeds of the foregoing equal to the Variable
Contributed Percentage.
"Credit Agreement" means that certain Third Amended and
Restated Credit Agreement dated as of April 18, 2000, among Originator, as
borrower, the General Partner, the financial institutions from time to time
party thereto, and Bank of America, N.A., as administrative agent and
documentation agent, as amended from time to time in accordance with the terms
thereof.
"Credit and Collection Policy" means Originator's credit and
collection policies and practices relating to Contracts and Receivables existing
on the date hereof and summarized in Exhibit V, as modified from time to time in
accordance with the Agreement.
"Deemed Collections" means Collections deemed to be received by Originator
in accordance with Section 1.4 of the Agreement.
"Default Fee" means a per annum rate of interest equal to the
sum of (i) the Prime Rate, plus (ii) 2% per annum (computed for actual days
elapsed on the basis of a 365/366-day year).
"Defaulted Receivable" means a Receivable as to which any
payment, or part thereof, remains unpaid for 61 or more days from the original
invoice date for such payment.
"Discount Factor" means a percentage calculated to provide
Buyer with a reasonable return on its investment in the Receivable Interest
after taking account of (i) the time value of money based upon the anticipated
dates of collection of the Pool Receivables and the cost to Buyer of financing
its investment in the Receivable Interest during such period and (ii) the risk
of nonpayment by the Obligors. Originator and Buyer may agree from time to time
to change the Discount Factor based on changes in one or more of the items
affecting the calculation thereof, provided that any change to the Discount
Factor shall take effect as of the commencement of a Calculation Period, shall
apply only prospectively and shall not affect the Purchase Price payment made
prior to the Calculation Period during which Originator and Buyer agree to make
such change.
"Dollars," "dollars" and "$" each mean lawful money of the United States.
"Eligible Receivable" means, at any time, a Receivable:
(i) the Obligor of which (a) if a natural person, is a resident of the United
States or, if a corporation or other business organization, is organized under
the laws of the United States or any political subdivision thereof and has its
chief executive office in the United States; (b) is not an Affiliate of any of
the parties hereto; and (c) is not a government or a governmental subdivision or
agency against which assignments of claims may only be assigned in compliance
with the Federal Assignment of Claims Act or similar legislation unless the
aggregate Outstanding Balance of all Pool Receivables from such Obligors is less
than 2% of the aggregate Outstanding Balance of all Pool Receivables,
(ii) the Obligor of which is not the Obligor on Defaulted Receivables, the
aggregate Outstanding Balance of which exceeds 10% of such Obligor's total
Receivables,
(iii) which is not a Defaulted Receivable or a Charged-Off Receivable,
(iv) which by its terms is due and payable within 30 days of the original
billing date therefor and has not had its payment terms extended,
(v) which is an "account" within the meaning of Article 9 of the UCC of all
applicable jurisdictions,
(vi) which is denominated and payable only in United States dollars in the
United States,
(vii) which arises under an invoice, which, together with such Receivable, is in
full force and effect and constitutes the legal, valid and binding obligation of
the related Obligor enforceable against such Obligor in accordance with its
terms subject to no offset, counterclaim or other defense,
(viii) which arises under an invoice which (A) does not require the Obligor
under such invoice to consent to the transfer, sale or assignment of the rights
and duties of Originator or any of its assignees under such invoice and (B) does
not contain a confidentiality provision that purports to restrict the ability of
Buyer or any of its assigns to exercise its rights under the Transaction
Documents, including, without limitation, its right to review such invoice,
(ix) which arises under an invoice that contains an obligation to pay a
specified sum of money, contingent only upon the sale of propane or the
provision of services by Originator,
(x) which, together with the invoice related thereto, does not contravene any
law, rule or regulation applicable thereto (including, without limitation, any
law, rule and regulation relating to truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection practices and
privacy) and with respect to which no part of the invoice related thereto is in
violation of any such law, rule or regulation,
(xi) which satisfies all material requirements of the Credit and Collection
Policy,
(xii) which was generated in the ordinary course of Originator's business,
(xiii) which arises solely from the sale of propane or the provision of services
to the related Obligor by Originator, and not by any other Person (in whole or
in part),
(xiv) as to which the Agent has not notified Originator or Buyer that the Agent
has determined, in the exercise of its commercially reasonable credit judgment,
that such Receivable or class of Receivables is not acceptable as an Eligible
Receivable,
(xv) which is not subject to any right of rescission, set-off, counterclaim, any
other defense (including defenses arising out of violations of usury laws) of
the applicable Obligor against Originator or any other Adverse Claim, and the
Obligor thereon holds no right as against Originator to cause Originator to
repurchase the propane the sale of which shall have given rise to such
Receivable (except with respect to sale discounts effected pursuant to the
invoice, or defective goods returned in accordance with the terms of the
invoice),
(xvi) as to which Originator has satisfied and fully performed all obligations
on its part with respect to such Receivable required to be fulfilled by it, and
no further action is required to be performed by any Person with respect thereto
other than payment thereon by the applicable Obligor,
(xvii) in which Buyer's undivided ownership interest therein is free and clear
of any Adverse Claim, and
(xviii) of which the Obligor and its Affiliates (considered as if they were one
and the same Obligor) are not the Obligors on more than 2% of the aggregate
Outstanding Balance of all Receivables.
"Environmental Laws" means all federal, state or local laws,
statutes, common law duties, rules, regulations, ordinances and codes, together
with all administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental
Authorities, in each case relating to environmental, health, safety and land use
matters.
"Equity Interests" means Capital Interests and all warrants,
options or other rights to acquire Capital Interests (but excluding any debt
security that is convertible into, or exchangeable for, Capital Interests).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and regulations promulgated thereunder.
"ERISA Event" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by Originator or the General Partner from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was
a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a withdrawal under Section
4062(e) of ERISA; (c) the filing of a notice of intent to terminate, the
treatment of a plan amendment as a termination under Section 4041 or 4041A of
ERISA or the commencement of proceedings by the PBGC to terminate a Pension Plan
subject to Title IV of ERISA; (d) a failure by Originator or the General Partner
to make required contributions to a Pension Plan or other Plan subject to
Section 412 of the Code; (e) an event or condition which might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan; (f) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon Originator or the
General Partner; or (g) an application for a funding waiver or an extension of
any amortization period pursuant to Section 412 of the Code with respect to any
Pension Plan.
"Event of Default" has the meaning specified in the Credit Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
"Facility Account" means Buyer's account no. 0000000000 at Xxxxx Fargo
Bank, in Dallas, Texas, ABA No. 000000000.
"FCI ESOT" means the employee stock ownership trust of Xxxxxxx Companies,
Inc. organized under Section 4975(e)(7) of the Code.
"Finance Charges" means, with respect to a Contract, any
finance, interest, late payment charges or similar charges owing by an Obligor
pursuant to such Contract.
"Fixed Charge Coverage Ratio" means with respect to Originator
and the Restricted Subsidiaries for any period, the ratio of Consolidated Cash
Flow for such period to Fixed Charges for such period. In the event that
Originator or any of the Restricted Subsidiaries (a) incurs, assumes or
guarantees any Indebtedness or Synthetic Lease Obligations (other than revolving
credit borrowings including, with respect to the Originator, the Loans) or (b)
redeems or repays any Indebtedness or Synthetic Lease Obligations (other than
revolving credit borrowings that are properly classified as a current liability
for GAAP including, with respect to the Originator, the Loans to the extent that
such Loans are so classified and excluding, regardless of classification, any
Loans or other Indebtedness or Synthetic Lease Obligations the proceeds of which
are used for Acquisitions or Growth Related Capital Expenditures), in any case
subsequent to the commencement of the period for which the Fixed Charge Coverage
Ratio is being calculated but prior to the date of the event for which the
calculation of the Fixed Charge Coverage Ratio is made (the "Fixed Charge Ratio
Calculation Date"), then the Fixed Charge Coverage Ratio shall be calculated
giving pro forma effect to such incurrence, assumption, guarantee, redemption or
repayment of Indebtedness or Synthetic Lease Obligations, as if the same had
occurred at the beginning of the applicable reference period. The foregoing
calculation of the Fixed Charge Coverage Ratio shall also give pro forma effect
to Acquisitions (including all mergers and consolidations), Asset Sales and
other dispositions and discontinuances of businesses or assets that have been
made by Originator or any of the Restricted Subsidiaries during the reference
period or subsequent to such reference period and on or prior to the Fixed
Charge Ratio Calculation Date assuming that all such Acquisitions, Asset Sales
and other dispositions and discontinuances of businesses or assets had occurred
on the first day of the reference period; provided, however, that with respect
to Originator and the Restricted Subsidiaries, (a) Fixed Charges shall be
reduced by amounts attributable to businesses or assets that are so disposed of
or discontinued only to the extent that the obligations giving rise to such
Fixed Charges would no longer be obligations contributing to the Fixed Charges
of Originator or the Restricted Subsidiaries subsequent to Fixed Charge Ratio
Calculation Date and (b) Consolidated Cash Flow generated by an acquired
business or asset of Originator or the Restricted Subsidiaries shall be
determined by the actual gross profit (revenues minus costs of goods sold) of
such acquired business or asset during the immediately preceding number of full
fiscal quarters as are in the reference period minus the pro forma expenses that
would have been incurred by Originator and the Restricted Subsidiaries in the
operation of such acquired business or asset during such period computed on the
basis of (i) personnel expenses for employees retained by Originator and the
Restricted Subsidiaries in the operation of the acquired business or asset and
(ii) non-personnel costs and expenses incurred by Originator and the Restricted
Subsidiaries on a per gallon basis in the operation of the Originator's business
at similarly situated Originator facilities.
"Fixed Charges" means, with respect to Originator and the
Restricted Subsidiaries for any period, the sum, without duplication, of (a)
Consolidated Interest Expense for such period, whether paid or accrued, to the
extent such expense was deducted in computing Consolidated Net Income (including
amortization of original issue discounts, non-cash interest payments, the
interest component of all payments associated with Capital Lease Obligations and
net payments (if any) pursuant to Hedging Obligations permitted under this
Agreement), (b) commissions, discounts and other fees and charges incurred with
respect to letters of credit, (c) any interest expense on Indebtedness of
another Person that is guaranteed by Originator and the Restricted Subsidiaries
or secured by an Adverse Claim on assets of any such Person, and (d) the product
of (i) all cash dividend payments on any series of preferred stock of Originator
and the Restricted Subsidiaries, times (ii) a fraction, the numerator of which
is one and the denominator of which is one minus the then current combined
federal, state and local statutory tax rate of the Originator, expressed as a
decimal, determined, in each case, on a consolidated basis and in accordance
with GAAP.
"Funded Amount" means, as of any date of determination through
and including the Termination Date, the Aggregate Capital (under and as defined
in the Purchase Agreement) then outstanding.
"Funded Debt" means all Indebtedness of Originator and the
Restricted Subsidiaries, excluding all Contingent Obligations of Originator and
the Restricted Subsidiaries under or in connection with Letters of Credit
outstanding from time to time.
"GAAP" means generally accepted accounting principles set
forth from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
U.S. accounting profession), which are applicable to the circumstances as of the
date of determination.
"General Partner" means Ferrellgas, Inc., a Delaware
corporation and the sole general partner of Originator.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Growth-Related Capital Expenditures" means, with respect to
any Person, all capital expenditures by such Person made to improve or enhance
the existing capital assets or to increase the customer base of such Person or
to acquire or construct new capital assets (but excluding capital expenditures
made to maintain, up to the level thereof that existed at the time of such
expenditure, the operating capacity of the capital assets of such Person as such
assets existed at the time of such expenditure).
"Guarantor" has the meaning specified in the Credit Agreement.
"Guaranty Obligation" has the meaning specified in the definition of
"Contingent Obligation."
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (a) interest rate swap agreements, interest
rate cap agreements and interest rate collar agreements and (b) other agreements
or arrangements designed to protect such Person against fluctuations in interest
rates.
"Indebtedness" of any Person means, without duplication: (a)
all indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than trade
payables entered into in the ordinary course of business on ordinary terms); (c)
all non-contingent reimbursement or payment obligations with respect to Surety
Instruments; (d) all obligations evidenced by notes, bonds, debentures or
similar instruments, including obligations so evidenced incurred in connection
with the acquisition of property, assets or businesses; (e) all indebtedness
created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to property
acquired by the Person (even though the rights and remedies of the seller or
bank under such agreement in the event of default are limited to repossession or
sale of such property); (f) all Capital Lease Obligations; (g) all Hedging
Obligations; (h) all obligations in respect of Accounts Receivable
Securitizations (as defined in the Credit Agreement); (i) all indebtedness
referred to in clauses (a) through (h) above secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Adverse Claim upon or in property (including accounts and
contracts rights) owned by such Person, even though such Person has not assumed
or become liable for the payment of such Indebtedness; and (j) all Guaranty
Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (a) through (i) above; provided, however, that
"Indebtedness" shall not include Synthetic Lease Obligations.
"Indemnified Amounts" has the meaning specified in Section 8.1
"Indemnified Party" has the meaning specified in Section 8.1.
"Independent Auditor" has the meaning specified in Section 5.1(a).
"Initial Computation Date" means the close of business on September 25,
2000.
"Insolvency Proceeding" means (a) any case, action or
proceeding before any court or other Governmental Authority relating to
bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors, or (b) any general assignment for the benefit
of creditors, composition, marshalling of assets for creditors, or other similar
arrangement in respect of a Person's creditors generally or any substantial
portion of a Person's creditors; undertaken under U.S. Federal, state or foreign
law, including the Bankruptcy Code.
"Interest Coverage Ratio" means with respect to Originator and
the Restricted Subsidiaries for any period, the ratio of Consolidated Cash for
such period to Consolidated Interest Expense for such period. In the event that
Originator or any of the Restricted Subsidiaries (a) incurs, assumes or
guarantees any Indebtedness or Synthetic Lease Obligations (other than revolving
credit borrowings including, with respect to the Originator, the Loans) or (b)
redeems or repays any Indebtedness or Synthetic Lease Obligations (other than
revolving credit borrowings that are properly classified as a current liability
under GAAP including, with respect to the Originator, the Loans, to the extent
such Loans are so classified and excluding, regardless of classification, any
Loans or other Indebtedness or Synthetic Lease Obligations the proceeds of which
are used for Acquisitions or Growth Related Capital Expenditures), in any case
subsequent to the commencement of the period for which the Interest Coverage
Ratio is being calculated, but prior to the date on which the calculation of the
Interest Coverage Ratio is made (the "Interest Coverage Ratio Calculation
Date"), then the Interest Coverage Ratio shall be calculated giving pro forma
effect to such incurrence, assumption, guarantee, redemption or repayment of
Indebtedness or Synthetic Lease Obligations, as if the same had occurred at the
beginning of the applicable reference period. The foregoing calculation of the
Interest Coverage Ratio shall also give pro forma effect to Acquisitions
(including all mergers and consolidations), Asset Sales and other dispositions
and discontinuances of businesses or assets that have been made by Originator or
any of the Restricted Subsidiaries during the reference period or subsequent to
such reference period and on or prior to the Interest Coverage Ratio Calculation
Date assuming that all such Acquisitions, Asset Sales and other dispositions and
discontinuances of businesses or assets had occurred on the first day of the
reference period; provided, however, that with respect to Originator and the
Restricted Subsidiaries, (a) Consolidated Interest Expense shall be reduced by
amounts attributable to businesses or assets that are so disposed of or
discontinued only to the extent that the Indebtedness or Synthetic Lease
Obligations giving rise to such Consolidated Interest Expense would no longer be
Indebtedness or Synthetic Lease Obligations contributing to the Consolidated
Interest Expense of Originator or the Restricted Subsidiaries subsequent to the
Interest Coverage Ratio Calculation Date and (b) Consolidated Cash Flow
generated by an acquired business or asset of Originator and the Restricted
Subsidiaries shall be determined by the actual gross profit (revenues minus
costs of goods sold) of such acquired business or asset during the immediately
preceding number of full fiscal quarters as in the reference period minus the
pro forma expenses that would have been incurred by Originator and the
Restricted Subsidiaries in the operation of such acquired business or asset
during such period computed on the basis of (i) personnel expenses for employees
retained by Originator and the Restricted Subsidiaries in the operation of the
acquired business or asset and (ii) non-personnel costs and expenses incurred by
Originator and the Restricted Subsidiaries on a per gallon basis in the
operation of the Originator's business at similarly situated facilities of the
Originator.
"Letter of Credit" has the meaning provided in the Credit Agreement.
"Leverage Ratio" means, with respect to Originator and the
Restricted Subsidiaries for any period, the ratio of Funded Debt plus Synthetic
Lease Obligations, in each case of Originator and the Restricted Subsidiaries as
of the last day of such period, to Consolidated Cash Flow for such period. In
the event that Originator or any of the Restricted Subsidiaries (a) incurs,
assumes or guarantees any Indebtedness or Synthetic Lease Obligations (other
than revolving credit borrowings including, with respect to the Originator, the
Loans) or (b) redeems or repays any Indebtedness or Synthetic Lease Obligations
(other than revolving credit borrowings that are properly classified as a
current liability under GAAP including, with respect to the Originator, the
Loans to the extent such Loans are so classified and excluding, regardless of
classification, any Loans or other Indebtedness or Synthetic Lease Obligations
the proceeds of which are used for Acquisitions or Growth Related Capital
Expenditures), in any case subsequent to the commencement of the period for
which the Leverage Ratio is being calculated but prior to the date on which the
calculation of the Leverage Ratio is made (the "Leverage Ratio Calculation
Date"), then the Leverage Ratio shall be calculated giving pro forma effect to
such incurrence, assumption, guarantee, redemption or repayment of Indebtedness
or Synthetic Lease Obligations, as if the same had occurred at the beginning of
the applicable reference period. The foregoing calculation of the Leverage Ratio
shall also give pro forma effect to Acquisitions (including all mergers and
consolidations), Asset Sales and other dispositions and discontinuances of
businesses or assets that have been made by Originator or any of the Restricted
Subsidiaries during the reference period or subsequent to such reference period
and on or prior to the Leverage Ratio Calculation Date assuming that all such
Acquisitions, Asset Sales and other dispositions and discontinuances of
businesses or assets had occurred on the first day of the reference period;
provided, however, that with respect to Originator and the Restricted
Subsidiaries, (a) Funded Debt and Synthetic Lease Obligations shall be reduced
by amounts attributable to businesses or assets that are so disposed of or
discontinued only to the extent that the Indebtedness or Synthetic Leases
included within such Funded Debt and Synthetic Lease Obligations would no longer
be an obligation of Originator or the Restricted Subsidiaries subsequent to the
Leverage Ratio Calculation Date and (b) Consolidated Cash Flow generated by an
acquired business or asset of Originator or the Restricted Subsidiaries shall be
determined by the actual gross profit (revenues minus costs of goods sold) of
such acquired business or asset during the immediately preceding number of full
fiscal quarters as in the reference period minus the pro forma expenses that
would have been incurred by Originator and the Restricted Subsidiaries in the
operation of such acquired business or asset during such period computed on the
basis of (i) personnel expenses for employees retained by Originator and the
Restricted Subsidiaries in the operation of the acquired business or asset and
(ii) non-personnel costs and expenses incurred by Originator and the Restricted
Subsidiaries on a per gallon basis in the operation of the Originator's business
at similarly situated facilities of the Originator.
"Loan" has the meaning provided in the Credit Agreement.
"Material Adverse Effect" means (i) a material adverse change
in, or a material adverse effect upon, the operations, business, properties,
condition (financial or otherwise) or prospects of Originator; (ii) a material
impairment of the ability of Originator or any Subsidiary to perform under any
Transaction Document to which it is a party; (iii) a material adverse effect
upon the legality, validity, binding effect or enforceability against Originator
or any Subsidiary of any Transaction Document to which it is a party; (iv) a
material adverse effect upon Originator's, Buyer's, the Agent's or any
Purchaser's interest in the Pool Receivables generally or in any significant
portion of the Pool Receivables, or (v) a material adverse effect upon the
collectibility of the Pool Receivables generally or of any material portion of
the Pool Receivables.
"Minimum Receivables Percentage" means, on any date of
determination through and including the Termination Date, a variable undivided
interest in and to the Pool Receivables and the associated Collections and all
proceeds of the foregoing, which interest is equal to the percentage equal to a
fraction, the numerator of which is equal to the Adjusted Pool Amount as of such
date of determination, and the denominator of which is the aggregate Outstanding
Balance of all Pool Receivables as of the close of business on the Business Day
immediately preceding the date of determination.
"MLP" means Ferrellgas Partners, L.P., a Delaware limited
partnership and the sole limited partner of the Originator.
"Net Income" means, with respect to Originator and the
Restricted Subsidiaries, the net income (loss) of such Persons, determined in
accordance with GAAP and before any reduction in respect of preferred stock
dividends, excluding, however, (a) any gain (but not loss), together with any
related provision for taxes on such gain (but not loss), realized in connection
with (i) any asset sale (including, without limitation, dispositions pursuant to
sale and leaseback transactions), or (ii) the disposition of any securities or
the extinguishment of any Indebtedness of Originator or any of the Restricted
Subsidiaries, and (b) any extraordinary gain (but not loss), together with any
related provision for taxes on such extraordinary gain (but not loss); provided,
however, that all costs and expenses with respect to the redemption of the 10%
Series A Fixed Rate Senior Notes due 2001 that were issued by Originator and
Ferrellgas Finance Corp. pursuant to that certain Indenture dated as of July 5,
1994 among the Originator, Ferrellgas Finance Corp. and Norwest Bank Minnesota,
National Association, including, without limitation, cash premiums, tender offer
premiums, consent payments and all fees and expenses in connection therewith,
shall be added back to the Net Income of the Originator, the General Partner or
the Restricted Subsidiaries to the extent that they were deducted from such Net
Income in accordance with GAAP.
"Non-Recourse Subsidiary" has the meaning specified in the Credit
Agreement.
"Obligor" means a Person obligated to make payments pursuant to a Contract.
"Organization Documents" means, (a) for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate of
determination or instrument relating to the rights of preferred shareholders of
such corporation, any shareholder rights agreement, and all applicable
resolutions of the board of directors (or any committee thereof) of such
corporation, (b) for any general or limited partnership, the partnership
agreement of such partnership and all amendments thereto and any agreements
otherwise relating to the rights of the partners thereof, and (c) for any
limited liability company, the limited liability, operating or similar agreement
and all amendments thereto and any agreements otherwise relating to the rights
of the members thereof.
"Originator" has the meaning set forth in the preamble to the Agreement.
"Originator's Account" has the meaning set forth in Section 1.3(a).
"Originator's Percentage" means, on any date of determination,
100% minus the Buyer's Percentage on such date.
"Outstanding Balance" of any Pool Receivable at any time means
the then outstanding principal balance thereof.
"Partnership Agreement" shall mean the Second Amended and
Restated Agreement of Limited Partnership of Originator dated October 14, 1998,
as amended from time to time in accordance with the terms of this Agreement.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions under ERISA.
"Pension Plan" means a pension plan (as defined in Section
3(2) of ERISA) subject to Title IV of ERISA which Originator or the General
Partner sponsors, maintains, or to which it makes, is making, or is obligated to
make contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding five (5) plan years.
"Person" means an individual, partnership, corporation,
limited liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
"Plan" means an employee benefit plan (as defined in Section
3(3) of ERISA) which Originator sponsors or maintains or to which Originator or
the General Partner makes, is making, or is obligated to make contributions and
includes any Pension Plan.
"Pool Receivables" means, collectively, all Eligible
Receivables existing on the Initial Computation Date and all Eligible
Receivables arising after the Initial Computation Date through and including the
Termination Date, and "Pool Receivable" means any such Eligible Receivable
individually. For the avoidance of doubt, a Receivable shall cease to be a Pool
Receivable if on any day prior to the Termination Date, such Receivable ceases
to be an Eligible Receivable, but shall continue to be a Pool Receivable if it
ceases to be an Eligible Receivable on or after the Termination Date.
"Potential Termination Event" means an event which, with the
passage of time or the giving of notice, or both, would constitute a Termination
Event.
"Prime Rate" means a rate per annum equal to the prime rate of
interest announced from time to time by Bank One, NA or its Originator (which is
not necessarily the lowest rate charged to any customer), changing when and as
said prime rate changes
"Purchase" means the purchase pursuant to Section 1.2(a) of
the Agreement by Buyer from Originator of the Receivable Interest, together with
all related rights in connection therewith.
"Purchase Agreement" has the meaning set forth in the Preliminary
Statements to the Agreement.
"Purchase Price" means, on any date of determination, the
aggregate price to be paid by Buyer to Originator for the Receivable Interest,
which price shall equal (a) the product of (i) the Variable Purchased Percentage
on such date, multiplied by (ii) the Outstanding Balance of the Pool Receivables
as of the close of business on the Business Day preceding the date of
determination, multiplied by (iii) one minus the Discount Factor in effect on
such date.
"Receivable" means each account receivable owed to Originator
(at the time it arises, and before giving effect to any transfer or conveyance
under the Agreement), arising in connection with the sale of propane or
provision of related services by Originator, including, without limitation, the
obligation to pay any Finance Charges with respect thereto. Accounts receivable
arising from any one transaction, including, without limitation, accounts
receivable represented by a single invoice, shall constitute a Receivable
separate from a Receivable consisting of the accounts arising from any other
transaction; provided, further, that any account receivable referred to in the
immediately preceding sentence shall be a Receivable regardless or whether the
account debtor or Originator treats such obligation as a separate payment
obligation.
"Receivable Interest" means a specified dollar amount of Pool
Receivables which equates to a variable undivided percentage interest (equal to
the Variable Purchased Percentage) in and to the Pool Receivables, the
associated Related Security and Collections and all proceeds of the foregoing.
"Records" means, with respect to any Pool Receivable, (i) any
and all customer information regarding payment history of the applicable
Obligor, propane gallons delivered to the applicable Obligor, timing of propane
gallons delivered to the applicable Obligor, payment terms and prices charged to
the applicable Obligor, and (ii) any and all invoices evidencing all or any
portion of the amount owing under such Pool Receivable, whether each of the
foregoing is in paper or electronic form.
"Related Party" means (a) the spouse or any lineal descendant
of Xxxxx X. Xxxxxxx, (b) any trust for his benefit or for the benefit of his
spouse or any such lineal descendants, (c) any corporation, partnership or other
entity in which Xxxxx X. Xxxxxxx and/or such other Persons referred to in the
foregoing clauses (a) and (b) are the direct record and beneficial owners of all
of the voting and nonvoting Equity Interests, (d) the FCI ESOT or (e) any
participant in the FCI ESOT whose ESOT account has been allocated shares of
Xxxxxxx Companies, Inc.
"Related Security" means, with respect to any Pool Receivable:
(i) all Records related to such Pool Receivable, and
(ii) all proceeds of such Pool Receivable or Records.
"Reportable Event" means any of the events set forth in
Section 4043(b) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
"Requirement of Law" means, as to any Person, any law
(statutory or common), treaty, rule or regulation or determination of an
arbitrator or of a Governmental Authority, in each case applicable to or binding
upon the Person or any of its property or to which the Person or any of its
property is subject.
"Responsible Officer" means the chief executive officer, the
president, the chief financial officer or the treasurer of the General Partner
or any other officer having substantially the same authority and responsibility
to act for the General Partner on behalf of Originator.
"Restricted Subsidiary" has the meaning provided in the Credit Agreement.
"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
"Servicer" has the meaning specified in Section 6.1.
"Servicer's Concentration Account" means account no. 0000000000 in the name
of the Servicer at Xxxxx Fargo Bank in Dallas, Texas, ABA No. 000000000.
"Servicing Fee" has the meaning set forth in Section 6.3.
"Settlement Date" has the meaning set forth in the Purchase Agreement.
"Subordinated Loan" means a loan from Originator to Buyer of a
portion of the Purchase Price that is evidenced by and payable as provided in
the Subordinated Note.
"Subordinated Note" means a subordinated promissory note of
the Buyer payable to the order of the Originator in substantially the form of
Exhibit V hereto, which promissory note shall evidence that portion of the
Purchase Price owing by the Buyer to the Originator at any time in respect of
the Receivable Interest owned by the Buyer at such time.
"Subsidiary" means, with respect to any Person, any
corporation, limited liability company, partnership, association or other
business entity of which more than 50% of the total voting power of shares of
Capital Interests entitled (without regard to the occurrence of any contingency)
to vote in the election of directors, managers or trustees thereof (or, in the
case of a limited partnership, more than 50% of either the general partners'
Capital Interests or the limited partners' Capital Interests) is at the time
owned or controlled, directly or indirectly, by such Person or one or more of
the other Subsidiaries of that Person or a combination thereof. Unless otherwise
indicated in this Agreement, "Subsidiary" shall mean a Subsidiary of the
Originator. Notwithstanding the foregoing, any Subsidiary of Originator that is
designated a "Non-Recourse Subsidiary" pursuant to the definition thereof in
this Agreement shall, for so long as all of the statements in the definition
thereof remain true, not be deemed a Subsidiary of the Originator.
"Surety Instruments" means all letters of credit (including
standby and commercial), bankers' acceptances, bank guaranties, shipside bonds,
surety bonds and similar instruments.
"Synthetic Lease" means each arrangement, however described,
under which the obligor accounts for its interest in the property covered
thereby under GAAP as lessee of a lease which is not a capital lease under GAAP
and accounts for its interest in the property covered thereby for Federal income
tax purposes as the owner.
"Synthetic Lease Documents" means, collectively, (i) that
certain Lease Intended as Security dated as of December 1, 1999 between
Ferrellgas, LP, as lessee, and First Security Bank, National Association, in its
capacity as Certificate Trustee, a lessor, (ii) that certain Participation
Agreement (Ferrellgas, LP Trust No. 1999-A), dated as of December 1, 1999, among
Ferrellgas, LP, as lessee; Ferrellgas, Inc., as general partner, First Security
Bank, National Association, as certificate trustee; First Security Trust Company
of Nevada, as agent; and various certificate purchasers and lenders named
therein, together with all exhibits, schedules and appendices thereto, and (iii)
each of the "Operative Documents" and "Loan Documents" as defined in the
participation agreement described in clause (ii) above.
"Synthetic Lease Interest Component" means, with respect to
any Person for any period, the portion of rent paid or payable (without
duplication) for such period under Synthetic Leases of such Person that would be
treated as interest in accordance with Financial Accounting Standards Board
Statement No. 13 if such Synthetic Leases were treated as capital leases under
GAAP.
"Synthetic Lease Obligation" means, as to any Person with
respect to any Synthetic Lease at any time of determination, the amount of the
liability of such Person in respect of such Synthetic Lease that would (if such
lease was required to be classified and accounted for as a capital lease on a
balance sheet of such Person in accordance with GAAP) be required to be
capitalized on the balance sheet of such Person at such time.
"Synthetic Lease Principal Component" means, with respect to
any Person for any period, the portion of rent (exclusive of the Synthetic Lease
Interest Component) paid or payable (without duplication) for such period under
Synthetic Leases of such Person that was deducted in calculating Consolidated
Net Income of such Person for such period.
"Termination Date" means the earliest to occur of (i) the
Facility Termination Date under and as defined in the Purchase Agreement, (ii)
the Business Day immediately prior to the occurrence of a Termination Event set
forth in Section 7.1(f) or (g) with respect to Originator, (iii) the Business
Day specified in a written notice from Buyer (or the Agent, as Buyer's assignee)
to Originator following the occurrence of any other Termination Event, and (iv)
the date which is 30 Business Days after receipt by the Agent (as Buyer's
assignee) of written notice from Originator that it wishes to terminate the
facility evidenced by this Agreement.
"Termination Event" has the meaning set forth in Section 7.1 of the
Agreement.
"Transaction Documents" means, collectively, this Agreement,
the Purchase Agreement, and all other instruments, documents and agreements
executed and delivered by Originator in connection herewith or therewith.
"UCC" means the Uniform Commercial Code as from time to time
in effect in the specified jurisdiction.
"Unfunded Pension Liability" means the excess of a Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
"Unrestricted Subsidiary" means any Subsidiary which is not a Restricted
Subsidiary.
"Variable Contributed Percentage" means, on any date of
determination through and including the Termination Date, a variable undivided
interest in and to the Pool Receivables and the associated Related Security and
Collections and all proceeds of the foregoing, which interest is equal to the
percentage of the aggregate Outstanding Balance of all Pool Receivables as of
the close of business on the Business Day immediately preceding the date of
determination which has been transferred by the Originator to the Buyer in the
form of an equity capital contribution.
"Variable Purchased Percentage" means, on any date of
determination through and including the Termination Date, the Minimum
Receivables Percentage on such date minus the Variable Contributed Percentage on
such date; provided that, (a) from and after the Termination Date until the
Aggregate Unpaids have been indefeasibly paid in full, the Variable Purchased
Percentage shall be equal to the Variable Purchased Percentage determined as of
the date immediately preceding the Termination Date, (b) from and after the date
on which the Aggregate Unpaids have been indefeasibly paid in full, the Variable
Purchased Percentage shall be zero, and (c) at no time shall the Variable
Purchased Percentage exceed 100%.
"Wholly-Owned Subsidiary" means a Subsidiary of which all of
the outstanding Capital Interests or other ownership interests (other than
directors' qualifying shares) or, in the case of a limited partnership, all of
the partners' Capital Interests (other than up to a 1% general partner
interest), is owned, beneficially and of record, by the Originator, a
Wholly-Owned Subsidiary of Originator or both.
All accounting terms not specifically defined herein shall be
construed in accordance with GAAP. All terms used in Article 9 of the UCC in the
State of New York, and not specifically defined herein, are used herein as
defined in such Article 9.
Exhibit II
Principal Place of Business and Chief Executive Office; Locations of
Records;
Federal Employer Identification Number; Other Names
Chief Executive Office and Principal Place of Business:
Xxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Location of Records:
.........Same as above
Federal Employer Identification Number:
.........00-0000000
Partnership, Trade and Assumed Names:
Names currently used:...... Ferrellgas, L.P.
.................. Thermogas
.................. Elk Grove Gas & Oil, Inc.
.................. Foothill Propane, Inc.
.................. Puget Propane
Name previously used:......A-One Propane
.................. Folgers Gas
.................. Gas Plus, Inc.
.................. Pacific Propane, Inc.
.................. Propane Service Center
.................. Xxxxxxxx Fuels
.................. Xxxxx Gas & Appliance
Exhibit III
Form of Compliance Certificate
This Compliance Certificate is furnished pursuant to that
certain Receivable Interest Sale Agreement dated as of September 26, 2000,
between Ferrellgas, L.P. ("Originator") and Ferrellgas Receivables, LLC (the
"Agreement"). Capitalized terms used and not otherwise defined herein are used
with the meanings attributed thereto in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ______________ of Originator.
2. I have reviewed the terms of the Agreement and I have made,
or have caused to be made under my supervision, a detailed review of the
transactions and conditions of Originator and its Subsidiaries during the
accounting period covered by the attached financial statements.
3. The examinations described in paragraph 2 did not disclose,
and I have no knowledge of, the existence of any condition or event which
constitutes a Termination Event or a Potential Termination Event, as each such
term is defined under the Agreement, during or at the end of the accounting
period covered by the attached financial statements or as of the date of this
Certificate, except as set forth below.
4. Described below are the exceptions, if any, to paragraph 3
by listing, in detail, the nature of the condition or event, the period during
which it has existed and the action which Originator has taken, is taking, or
proposes to take with respect to each such condition or event:
The foregoing certifications, together with the computations
set forth in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this ____ day of
__________, 20__.
------------------------------
[Name]
Exhibit IV
Credit and Collection Policy
[attached]
Exhibit V
[Form of] Subordinated Note
SUBORDINATED NOTE
1. Note. FOR VALUE RECEIVED, the undersigned, Ferrellgas
Receivables, LLC, a Delaware limited liability company ("Buyer"), hereby
unconditionally promises to pay to the order of Ferrellgas, L.P., a Delaware
limited partnership ("Seller"), in lawful money of the United States of America
and in immediately available funds, on or before the date following the
Termination Date which is one year and one day after the date on which (i) the
Receivables Interest (as defined in the Receivables Interest Sale Agreement
hereinafter described) has been reduced to zero and (ii) all indemnities,
adjustments and other amounts which may be owed thereunder in connection with
the Receivable Interest (as defined in the Receivables Interest Sale Agreement
hereinafter described) have been paid (the "Collection Date"), the aggregate
unpaid principal sum outstanding of all Subordinated Loans (as defined in the
Receivables Interest Sale Agreement hereinafter described) made from time to
time by Seller to Buyer pursuant to and in accordance with the terms of that
certain Receivables Interest Sale Agreement dated as of September 26, 2000,
between Seller and Buyer (as amended, restated, supplemented or otherwise
modified from time to time, the "Receivables Interest Sale Agreement").
Reference to Section 1.3 of the Receivables Interest Sale Agreement is hereby
made for a statement of the terms and conditions under which the loans evidenced
hereby have been and will be made. Capitalized terms used and not otherwise
defined herein shall have the meanings ascribed to such terms in the Receivables
Interest Sale Agreement.
2. Interest. Buyer further promises to pay interest on the
outstanding unpaid principal amount hereof from the date hereof until payment in
full hereof at a rate equal to the one month LIBOR rate published on the first
business day of each month on or after September 1, 2000 in The Wall Street
Journal ("LIBOR"), changing on the first business day of each month; provided,
however, that if Buyer shall default in the payment of any principal hereof,
Buyer promises to pay, on demand, interest at a rate per annum equal to the sum
of LIBOR plus 2.00% per annum on any such unpaid amounts, from the date such
payment is due to the date of actual payment. Interest shall be payable on the
first Business Day of each month in arrears; provided, however, that Buyer may
elect on the date any interest payment is due hereunder to defer such payment
and upon such election the amount of interest due but unpaid on such date shall
constitute principal under this Subordinated Note. The outstanding principal of
any loan made under this Subordinated Note shall be due and payable on the
Collection Date and may be repaid or prepaid at any time without premium or
penalty.
3. Principal Payments. Seller is authorized and directed by
Buyer to enter on the grid attached hereto, or, at its option, in its books and
records, the date and amount of each loan made by it which is evidenced by this
Subordinated Note and the amount of each payment of principal made by Buyer, and
absent manifest error, such entries shall constitute prima facie evidence of the
accuracy of the information so entered; provided that neither the failure of
Seller to make any such entry or any error therein shall expand, limit or affect
the obligations of Buyer hereunder.
4. Subordination. Seller shall have the right to receive, and
Buyer shall have the right to make, any and all payments and prepayments
relating to the loans made under this Subordinated Note; provided that after
giving effect to any such payment or prepayment, the Receivable Interest plus
the Contributed Interest equals or exceeds the Minimum Receivables Percentage.
Seller hereby agrees that at any time during which the conditions set forth in
the proviso of the immediately preceding sentence shall not be satisfied, Seller
shall be subordinate in right of payment to the prior payment of any
indebtedness or obligation of Buyer owing to the Agent or any Purchaser (each,
as defined below) under that certain Receivables Purchase Agreement, dated as of
September 26, 2000, by and among Buyer, Seller, as Servicer, various
"Purchasers" from time to time party thereto, and Bank One, NA (Main Office
Chicago), as the "Agent" (as amended, restated, supplemented or otherwise
modified from time to time, the "Receivables Purchase Agreement"). The
subordination provisions contained herein are for the direct benefit of, and may
be enforced by, the Agent and the Purchasers and/or any of their respective
assignees (collectively, the "Senior Claimants") under the Receivables Purchase
Agreement. Until the date on which the "Aggregate Capital" outstanding under the
Receivables Purchase Agreement has been repaid in full and all obligations of
Buyer and/or the Servicer thereunder and under the "Fee Letter" referenced
therein (all such obligations, collectively, the "Senior Claim") have been
indefeasibly paid and satisfied in full, Seller shall not institute against
Buyer any proceeding of the type described in Section 7.1(f) or (g) of the
Receivables Interest Sale Agreement unless and until the Collection Date has
occurred. Should any payment, distribution or security or proceeds thereof be
received by Seller in violation of this Section 4, Seller agrees that such
payment shall be segregated, received and held in trust for the benefit of, and
deemed to be the property of, and shall be immediately paid over and delivered
to the Agent for the benefit of the Senior Claimants.
5. Bankruptcy; Insolvency. Upon the occurrence of any
proceeding of the type described in Section 7.1(f) or (g) of the Receivables
Interest Sale Agreement involving Buyer as debtor, then and in any such event
the Senior Claimants shall receive payment in full of all amounts due or to
become due on or in respect of the Aggregate Capital and the Senior Claim
(including "CP Costs" and "Yield" as defined and as accruing under the
Receivables Purchase Agreement after the commencement of any such proceeding,
whether or not any or all of such CP Costs or Yield is an allowable claim in any
such proceeding) before Seller is entitled to receive payment on account of this
Subordinated Note, and to that end, any payment or distribution of assets of
Buyer of any kind or character, whether in cash, securities or other property,
in any applicable insolvency proceeding, which would otherwise be payable to or
deliverable upon or with respect to any or all indebtedness under this
Subordinated Note, is hereby assigned to and shall be paid or delivered by the
Person making such payment or delivery (whether a trustee in bankruptcy, a
receiver, custodian or liquidating trustee or otherwise) directly to the Agent
for application to, or as collateral for the payment of, the Senior Claim until
such Senior Claim shall have been paid in full and satisfied.
6. Amendments. The terms of this Subordinated Note may not be
amended or otherwise modified without the prior written consent of the Agent for
the benefit of the Purchasers.
7. GOVERNING LAW. THIS SUBORDINATED NOTE HAS BEEN MADE AND
DELIVERED AT HOUSTON, TEXAS, AND SHALL BE INTERPRETED AND THE RIGHTS AND
LIABILITIES OF THE PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE LAWS AND
DECISIONS OF THE STATE OF TEXAS. WHEREVER POSSIBLE EACH PROVISION OF THIS
SUBORDINATED NOTE SHALL BE INTERPRETED IN SUCH MANNER AS TO BE EFFECTIVE AND
VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF THIS SUBORDINATED NOTE SHALL
BE PROHIBITED BY OR INVALID UNDER APPLICABLE LAW, SUCH PROVISION SHALL BE
INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR INVALIDITY, WITHOUT
INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE REMAINING PROVISIONS OF THIS
SUBORDINATED NOTE.
8. Waivers. All parties hereto, whether as makers, endorsers,
or otherwise, severally waive presentment for payment, demand, protest and
notice of dishonor. Seller additionally expressly waives all notice of the
acceptance by any Senior Claimant of the subordination and other provisions of
this Subordinated Note and expressly waives reliance by any Senior Claimant upon
the subordination and other provisions herein provided.
9. Assignment. This Subordinated Note may not be assigned,
pledged or otherwise transferred to any party without the prior written consent
of the Agent, and any such attempted transfer shall be void.
FERRELLGAS RECEIVABLES, LLC
By:_____________________________
Name: Xxxxx X. Xxxxx
Title:Chief Financial Officer
Schedule to Subordinated Note
SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL
Amount of Unpaid Principal
Subordinated Loan Amount of Principal Balance Notation Made by
Date Paid
Schedule A
DOCUMENTS TO BE DELIVERED TO BUYER
ON OR PRIOR TO THE PURCHASE
1. Executed copies of the Receivable Interest Sale Agreement, duly executed by
the parties thereto.
2. Certificate of Originator's [Assistant] Secretary certifying the incumbency
and signatures of its officers who are authorized to execute the
Transaction Documents to which it is a party and attaching each of the
following:
(b) Copy of the Resolutions of the Board of Directors of the General
Partner certified by its Secretary, authorizing Originator's execution,
delivery and performance of the Receivable Interest Sale Agreement and
the other documents to be delivered by it thereunder.
(c) Certificate of Limited Partnership of Originator certified by the
Secretary of State of Delaware on or within thirty (30) days prior to
the initial Purchase (as defined in the Receivable Interest Sale
Agreement).
(d) Good Standing Certificates for Originator and the General Partner
issued by the Secretaries of State of its state of organization and
each jurisdiction where it has material operations, each of which is
listed below:
i. Delaware
ii. Missouri
(e) A copy of Originator's Partnership Agreement.
3. Pre-filing state and federal tax lien, judgment lien and UCC lien searches
against Originator from the following jurisdictions:
a. Delaware SOS
b. Missouri SOS
x. Xxxx County, MO
4. Duly executed financing statements, in form suitable for filing under the
UCC, in all jurisdictions as may be necessary or, in the opinion of Buyer
(or its assigns), desirable, under the UCC of all appropriate jurisdictions
or any comparable law in order to perfect the ownership interests
contemplated by the Receivable Interest Sale Agreement.
5. Time stamped receipt copies of proper UCC termination statements, if any,
necessary to release all security interests and other rights of any Person
in the Pool Receivables, Contracts or Related Security previously granted
by Originator.
6. A favorable opinion of legal counsel for Originator reasonably acceptable
to Buyer (or its assigns) which addresses the following matters and such
other matters as Buyer (or its assigns) may reasonably request:
--Each of Originator and its General Partner is duly
organized, validly existing, and in good standing under the laws of its state of
organization.
--Each of Originator and its General Partner has all requisite
authority to conduct its business in each jurisdiction where failure to be so
qualified would have a material adverse effect on its business.
--The execution and delivery by Originator of the Receivable
Interest Sale Agreement and each other Transaction Document to which it is a
party and its performance of its obligations thereunder have been duly
authorized by all necessary action and proceedings on the part of Originator and
the General Partner and will not:
(a) require any action by or in respect of, or filing with,
any governmental body, agency or official (other than the filing of UCC
financing statements);
(b) contravene, or constitute a default under, any provision
of applicable law or regulation or of its Organization Documents or of
any material agreement, judgment, injunction, order, decree or other
instrument binding upon Originator, the MLP or the General Partner [to
include the Credit Agreement, both Note Purchase Agreements and the
Indenture]; or
(c) result in the creation or imposition of any Adverse Claim
on assets of the General Partner, Originator or any of their respective
Subsidiaries (except as contemplated by the Receivable Interest Sale
Agreement and the Purchase Agreement).
--The Receivable Interest Sale Agreement and each other
Transaction Document to which it is a party has been duly executed and delivered
by Originator and constitutes the legal, valid, and binding obligation of
Originator enforceable in accordance with its terms, except to the extent the
enforcement thereof may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and subject also to the
availability of equitable remedies if equitable remedies are sought.
--The provisions of the Receivable Interest Sale Agreement are
effective to create a valid security interest in favor of Buyer in all Pool
Receivables and upon the filing of financing statements, Buyer shall acquire a
first priority, perfected security interest in such Receivables.
--To the best of the opinion giver's knowledge, there is no
action, suit or other proceeding against Originator, General Partner or any
Affiliate of Originator or General Partner, which would materially adversely
affect the business or financial condition of Originator and its Affiliates
taken as a whole or which would materially adversely affect the ability of
Originator to perform its obligations under the Transaction Documents to which
it is a party.
7. A "true sale/true contribution" opinion and "substantive consolidation"
opinion of counsel for Originator with respect to the transactions
contemplated by the Receivable Interest Sale Agreement.
8. A Certificate of a Responsible Officer of Originator certifying that no
Termination Event or Potential Termination Event exists as of the date of
the Purchase or will result therefrom, and that each of the representations
and warranties made by Originator in any of the Transaction Documents to
which it is a party is true and correct as of such date.
9. Executed copies of (i) all consents from and authorizations by any Persons
and (ii) all waivers and amendments to existing credit facilities, that are
necessary in connection with the Receivable Interest Sale Agreement.
