Exhibit 10.4
SECOND AMENDED AND RESTATED REPURCHASE AGREEMENT
SECOND AMENDED AND RESTATED REPURCHASE AGREEMENT, dated as of
March 8, 2002 (as amended, supplemented or otherwise modified from time to
time, the "Repurchase Agreement"), made by RAYTHEON AIRCRAFT COMPANY, a Kansas
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corporation (together with its successors and assigns permitted herein, "RAC"),
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in favor of the Purchasers referred to below and BANK OF AMERICA, N.A., as
managing facility agent (in such capacity, the "Managing Facility Agent") for
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such Purchasers.
W I T N E S S E T H :
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WHEREAS, pursuant to the Purchase and Sale Agreement,
dated as of March 20, 1997 (as amended, supplemented or otherwise modified from
time to time, the "1997 Purchase Agreement"), among Raytheon Aircraft Credit
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Corporation ("Raytheon Credit"), as servicer, Raytheon Aircraft Receivables
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Corporation, as seller, the financial institutions from time to time parties
thereto, the several co-agents parties thereto, the several agents parties
thereto and Swiss Bank Corporation, New York Branch ("SBC"), RAC entered into
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the Repurchase Agreement, dated as of March 20, 1997 (the "1997 Repurchase
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Agreement") in favor of the purchasers referred to in the 1997 Purchase
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Agreement and SBC, as administrative agent for such purchasers;
WHEREAS, the 0000 Xxxxxxxxxx Agreement was amended and
restated by the Amended and Restated Repurchase Agreement, dated as of March
18, 1999 (the "Amended and Restated Repurchase Agreement");
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WHEREAS, the Amended and Restated Repurchase Agreement was
amended by the Reaffirmation of Amended and Restated Repurchase Agreement,
dated as of March 10, 2000;
WHEREAS, the Purchasers desire to continue the obligations
of RAC under the Amended and Restated Repurchase Agreement, as amended, and RAC
is willing to continue such obligations and undertake the obligations set forth
herein;
WHEREAS, the 1997 Purchase Agreement has been amended and
restated by the Amended and Restated Purchase and Sale Agreement, dated as of
March 18, 1999, the Second Amended and Restated Purchase and Sale Agreement,
dated as of March 10, 2000 and the Third Amended and Restated Purchase and Sale
Agreement, dated as of March 9, 2001 and is being amended and restated by the
Fourth Amended and Restated Purchase and Sale Agreement (the "Purchase
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Agreement"), dated as of March 8, 2002, among Raytheon Aircraft Receivables
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Corporation, as Seller (the "Seller"), Raytheon Credit, as Servicer (the
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"Servicer"), the financial institutions and special purpose corporations from
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time to time parties to the Purchase Agreement (the "Purchasers"), the Managing
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Facility Agent, Bank of America, N.A. and JPMorgan Chase Bank, as
Co-Administrative Agents for the Purchasers (in such capacity, a "Co-
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Administrative Agent"), X.X. Xxxxxx Securities Inc., as Syndication Agent (in
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such capacity, the "Syndication Agent"), Citibank, N.A., Credit Suisse First
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Boston and FleetBoston, as Co-Syndication Agents (in such capacity, a
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"Co-Syndication Agent"), and each Administrative Agent party thereto;
WHEREAS, it is a condition precedent to the obligations of
the Purchasers to make their respective purchases from the Seller under the
Purchase Agreement that RAC shall have executed and delivered this Repurchase
Agreement to the Managing Facility Agent for the ratable benefit of the
Purchasers;
WHEREAS, RAC is an indirect subsidiary of Raytheon Company,
which is also the indirect parent of each of the Seller and Raytheon Credit
and, since Raytheon Credit provides financing for RAC's aircraft inventory
which generates certain Receivables that Raytheon Credit sells to the Seller,
it is to the advantage of RAC that the Purchasers in turn purchase certain
Receivables from the Seller thereby ultimately providing Raytheon Credit with
additional funds for RAC aircraft inventory financings; and
WHEREAS, the parties hereto desire to restate the Amended
and Restated Repurchase Agreement as so amended, modified or supplemented in
its entirety;
NOW THEREFORE, in consideration of the premises and to
induce the Managing Facility Agent and the Purchasers to enter into the
Purchase Agreement and to induce the Purchasers to make their respective
purchases from the Seller under the Purchase Agreement, RAC hereby agrees with
the Managing Facility Agent, for the ratable benefit of the Purchasers, as
follows:
1. Defined Terms. Terms defined in the preamble hereof and
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the recitals hereto and terms defined in the Purchase Agreement and used herein
without definition shall have their defined meanings when used herein, and the
following terms shall have the following meanings:
"Debt": indebtedness for money borrowed.
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"Material Subsidiary": at any time, a Subsidiary of RAC
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which as of such time meets the definition of a "significant
subsidiary" as in effect at the Closing Date in Regulation S-X of
the Securities and Exchange Commission.
"Principal Property": (a) RAC's principal office building
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and (b) any manufacturing plant or principal research facility of
RAC or any Subsidiary of RAC which is located within the United
States of America or Canada, except any such principal office
building, plant or facility which the Board of Directors by
resolution declares is not of material importance to the total
business conducted by RAC and its Subsidiaries as an entirety.
"RAC Repurchase Percentage": means 90%.
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"RAC Repurchase Obligation": as defined in subsection 2(c).
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2. RAC Repurchase Obligation.
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(a) On each Settlement Date (other than a Special Settlement
Date) RAC agrees to repurchase from the Purchasers, up to the RAC Repurchase
Obligation, all Receivables which became Defaulted Receivables during each
preceding Settlement Period with respect to which the Seller has not
substituted an Eligible Receivable pursuant to subsection 2.13 of the Purchase
Agreement, as indicated on the Settlement Statement delivered on the related
Reporting Date. Subject to subsection 2(c) hereof and subsections 2.13,
2.15(b)(ii) and clause sixth of subsection 2.16(b) of the Purchase Agreement,
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RAC shall repurchase such Defaulted Receivables by depositing into the
Concentration Account on such Settlement Date cash in an amount equal to the
aggregate Outstanding Balances of the Defaulted Receivables plus, if a Trigger
Amortization Event has occurred and is continuing, accrued and unpaid interest
thereon at the rate under the related Contract except to the extent (without
duplication) of any payment made pursuant to subsection 2.18 of the Purchase
Agreement for the Settlement Period during which such interest accrued and was
not paid by the Obligor under such Contract. The amount of any such deposit
shall be applied and distributed in accordance with subsections 2.15 and 2.16
of the Purchase Agreement. If on any Settlement Date the Repurchase Price to be
paid by RAC for any Defaulted Receivable would cause the RAC Repurchase
Obligation then in effect (determined on such Settlement Date) to be exceeded,
RAC shall be deemed to acquire only a fractional interest in each Defaulted
Receivable repurchased on such Settlement Date. The numerator of such fraction
shall be the RAC Repurchase Obligation then in effect determined on such
Settlement Date and the denominator thereof shall be the aggregate Repurchase
Price for all Defaulted Receivables on such Settlement Date.
(b) In the event that a Rating Event occurs and is
continuing, any Net Recoveries received by RAC on account of any Defaulted
Receivable which neither RAC nor the Guarantor has repurchased shall be
deposited into the Cash Collateral Account. In the event that the Amortization
Period ends pursuant to clause (ii) of the definition of such term, any Net
Recoveries received by RAC after such time on account of any Defaulted
Receivable which neither RAC nor the Guarantor has repurchased shall be
deposited into the Cash Collateral Account. RAC shall make any deposit required
to be made by this subsection 2(b) within two Business Days after RAC's receipt
of such Net Recoveries and such deposits shall be applied in accordance with
subsections 2.15 and 2.16 of the Purchase Agreement. The obligation of RAC to
deposit such Net Recoveries shall survive the termination of this Repurchase
Agreement.
(c) The maximum repurchase obligation of RAC with respect to
Defaulted Receivables (the "RAC Repurchase Obligation") shall be equal to (a)
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at a ny time during the Revolving Period, an amount equal to the RAC Repurchase
Percentage of the excess of (A) the sum of (i) 25% of the aggregate Unadjusted
Outstanding Balances of the 25% Repurchase Receivables, (ii) 75% of the
aggregate Unadjusted Outstanding Balances of the 75% Repurchase Receivables and
(iii) 90% of the aggregate Unadjusted Outstanding Balances of the 90%
Repurchase Receivables over (B) the amount of any Discount Amount paid and the
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amount of any Purchase Discount resulting from the purchase or substitution of
Receivables during the
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existence of a Discount Event, in each case at the time the RAC Repurchase
Obligation is calculated;
provided that,
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(i) the RAC Repurchase Obligation shall not at any
time decrease below an amount equal to the RAC Repurchase
Percentage of (x) with respect to any Purchaser other than
a Dissenting Purchaser, an amount equal to the greater of
such Purchaser's share of (1) 15% of the maximum aggregate
Outstanding Balances of the Purchased Receivables which
existed at any time during the Revolving Period and (2)
the sum of the Outstanding Balances on the last day of the
Revolving Period of the three Obligors (and all of their
Affiliates) of Purchased Receivables with the largest
aggregate outstanding Principal Balances and (y) with
respect to any Dissenting Purchaser, an amount equal to
the greater of such Purchaser's share of (1) 15% of the
maximum aggregate Outstanding Balances of the sum of the
Purchased Receivables which existed at any time prior to
the date such Purchaser became a Dissenting Purchaser and
(2) the sum of the Outstanding Balances on the day on
which such Purchaser became a Dissenting Purchaser of the
three Obligors (and all of their Affiliates) of Purchased
Receivables with the largest aggregate outstanding Principal
Balances, minus, in each such case, to the extent not already
deducted in calculating such Outstanding Balances, such
Purchaser's allocated share of the amount of any Discount
Amount paid and the amount of any Purchase Discount resulting
from the purchase or substitution of Receivables during the
existence of a Discount Event and
(ii) notwithstanding clause (i) immediately above, the
RAC Repurchase Obligation shall not at any time exceed an
amount equal to the RAC Repurchase Percentage of the
Outstanding Purchase Price
or (b) during the Amortization Period, (A) the RAC Repurchase Obligation, as
calculated in accordance with clause (a) above, in effect on the last
Settlement Date prior to the commencement of the Amortization Period minus (B)
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the aggregate Repurchase Prices of Defaulted Receivables which were repurchased
by RAC pursuant to subsection 2(a) since the beginning of the Amortization
Period minus (C) amounts deposited by RAC into the RAC Cash Collateral
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Sub-Account pursuant to subsection 4(b) plus (D) all Net Recoveries received by
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RAC with respect to such Defaulted Receivables (or portion thereof) so
repurchased by RAC since the beginning of the Amortization Period and not
required to be deposited into the Cash Collateral Account pursuant to
subsection 2(b).
(d) The substitution by the Seller of an Eligible
Receivable for a Defaulted Receivable pursuant to
subsection 2.13 of the Purchase Agreement shall not reduce
the RAC Repurchase Obligation.
3. Certain Actions Following a Rating Event Under the
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Purchase Agreement. If a Rating Event shall occur and be continuing, then on no
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later than the twentieth Business Day following such occurrence RAC shall
deposit cash into the RAC Cash Collateral Sub-Account in an amount equal to the
RAC Repurchase Obligation (as of the Settlement Date preceding such
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date of deposit). As long as any Rating Event continues, (i) RAC shall deposit
cash into the RAC Cash Collateral Sub-Account in an amount equal to any
incremental increase in the RAC Repurchase Obligation resulting from purchases
of Receivables after the occurrence of such Rating Event immediately after such
incremental increase and (ii) any amounts deposited in the Cash Collateral
Account shall be applied from time to time in accordance with Section 4. If such
Rating Event shall cease to continue, the Managing Facility Agent shall, upon
written request of RAC, withdraw amounts so deposited in the RAC Cash Collateral
Sub-Account and deliver such amounts to RAC (or upon its order).
4. RAC Cash Collateral Sub-Account.
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(a) As provided in the Purchase Agreement, on or before the
Closing Date there shall be established with and in the name of the Managing
Facility Agent the Cash Collateral Account which shall be a segregated trust
account comprised of two segregated sub-accounts, the Seller Cash Collateral
Sub-Account and the RAC Cash Collateral Sub-Account and which shall be
maintained as a cash collateral account subject to the exclusive dominion and
control of the Managing Facility Agent for the ratable benefit of the
Purchasers. RAC hereby grants to the Managing Facility Agent for the ratable
benefit of the Purchasers a first priority security interest in the Cash
Collateral Account and all amounts on deposit from time to time therein and all
income from the investment of such amounts to secure, in each case, the
Obligations. Funds on deposit from time to time in the RAC Cash Collateral
Sub-Account shall bear interest at the then prevailing rate paid by the
Managing Facility Agent for deposit accounts with similar amounts on deposit
from time to time. If at any time funds on deposit in the RAC Cash Collateral
Sub-Account are greater than $100,000, the Managing Facility Agent may, but
shall not be required to, unless it receives a request from RAC, invest funds
on deposit in the RAC Cash Collateral Sub-Account in Cash Equivalents with
maturities not later than the next succeeding Settlement Date which is not a
Special Settlement Date (or such other maturities as RAC shall request and the
Managing Facility Agent shall approve), to the extent such requested Cash
Equivalents are available for investment. Any investment request by RAC shall
be given to the Managing Facility Agent one Business Day prior to the day the
investment is to be made (which shall be a Business Day in New York, New York
and San Francisco, California) and shall specify the particular Cash
Equivalents and maturities thereof. Any interest or investment earnings on
amounts in the RAC Cash Collateral Sub-Account or related investments shall be
retained in the RAC Cash Collateral Sub-Account to be withdrawn in accordance
with paragraphs (b), (c) and (d) of this Section 4. Neither the Managing
Facility Agent nor any Purchaser shall have any responsibility for any such
investment and the Managing Facility Agent shall be permitted to liquidate any
such investment, without liability for any loss occurring by reason of such
liquidation, to the extent necessary to make payments and distributions under
this Repurchase Agreement or the Purchase Agreement. RAC shall have no right to
withdraw amounts on deposit from time to time in the Cash Collateral Account.
(b) If on any Settlement Date on which RAC is required to
repurchase Defaulted Receivables pursuant to Section 2 and fails for any reason
to repurchase such Defaulted Receivables, whether or not the Seller fails to
repurchase such Defaulted Receivables or substitute for such Defaulted
Receivables under the Purchase Agreement, the Managing Facility Agent may
withdraw from amounts on deposit in the RAC Cash Collateral Sub-Account on
account of such Defaulted Receivables an amount equal to the lesser of (A) the
Repurchase Price
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for such Defaulted Receivables plus any accrued and unpaid interest thereon
required to be paid by Section 2(a) and (B) the amount then on deposit in the
RAC Cash Collateral Sub-Account. It is specifically understood and agreed that
amounts on deposit in the RAC Cash Collateral Sub-Account, whether on account
of 25% Repurchase Receivables, 75% Repurchase Receivables or 90% Repurchase
Receivables, may be withdrawn as aforesaid on account of any Defaulted
Receivable, regardless of the RAC Repurchase Percentage associated therewith or
whether the Seller's Repurchase Obligation shall be outstanding. Any amounts so
withdrawn shall be deposited into the Concentration Account and allocated and
distributed pursuant to subsections 2.15 and 2.16 of the Purchase Agreement,
respectively. RAC agrees with the Managing Facility Agent and the Purchasers to
deposit into the RAC Cash Collateral Sub-Account, without any requirement for
notice or demand therefor, the lesser of the amount withdrawn therefrom or the
sum of the RAC Repurchase Obligation then in effect on the date such withdrawal
is made, plus interest thereon at a rate per annum equal to the Default Rate
for the period from such date of withdrawal to such date of deposit. Deposit of
amounts into the RAC Cash Collateral Sub-Account pursuant to the preceding
sentence shall, to the extent of such deposit, satisfy RAC's obligation to
repurchase such Defaulted Receivables pursuant to Section 2.
(c) If the Seller or the Servicer (if then Raytheon Credit or
any Affiliate thereof) shall fail to make any deposit, payment or transfer of
funds required to be made by the Seller or the Servicer under the Purchase
Agreement or any other document executed and delivered in connection therewith,
including, without limitation, any payment, deposit or transfer of funds or
payment of any indemnity required to be made pursuant to subsection 2.7(b),
2.10, 2.11, 2.12, 2.18 or 9.1 of the Purchase Agreement (each such payment,
deposit or transfer, a "Reimbursable Obligation"), then the Managing Facility
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Agent with the consent of the Majority Purchasers may, in addition to any
similar rights in favor of the Managing Facility Agent hereunder, withdraw from
the RAC Cash Collateral Sub-Account on the date such Reimbursable Obligation is
due thereunder an amount equal to the lesser of (i) such Reimbursable
Obligation and (ii) the amount then on deposit in the RAC Cash Collateral
Sub-Account. RAC agrees with the Managing Facility Agent and the Purchasers to
deposit in the RAC Cash Collateral Sub-Account, without any requirement for
notice or demand therefor, the amount withdrawn on the date such withdrawal is
made, plus interest thereon at a rate per annum equal to the Default Rate for
the period from such date of withdrawal to such date of deposit.
(d) No amounts on deposit in the RAC Cash Collateral Sub-
Account (including interest or investment earnings) shall be released to RAC
until the Outstanding Purchase Price is reduced to zero and all other amounts
owing to the Managing Facility Agent or any Purchaser hereunder and under the
Purchase Agreement are paid in full, provided, that,
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(i) on each Settlement Date occurring during the continuance of a
Rating Event, after giving effect to all collections and
distributions on such date, the amounts on deposit in the Cash
Collateral Account in excess of the Aggregate Repurchase Obligation
on such Settlement Date shall be released pro rata based upon their
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respective repurchase obligations, to the Seller and to RAC; and
(ii) on the Business Day after the date on which the Outstanding
Purchase Price is reduced to zero and all other amounts owing to
the Managing Facility Agent and the
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Purchasers hereunder and under the Purchase Agreement have been paid
in full, all amounts on deposit in the RAC Cash Collateral Sub-Account
shall be released to RAC.
5. Yield Adjustment. If on any Settlement Date (other than
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a Special Settlement Date) any Expense Amount is not paid in full on such
Settlement Date, then on such Settlement Date RAC will pay to the Managing
Facility Agent for the account of each Purchaser the amounts required to pay
all such Expense Amounts in full. RAC shall not be obligated to pay pursuant to
this Section 5 any Expense Amounts which accrue after the date the Amortization
Period ends; provided that RAC shall remain obligated to pay any Expense Amount
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which accrued prior to such date (whether or not claimed prior to such date) so
long as a claim for such Expense Amount is made prior to the times set forth in
the subsection of the Purchase Agreement governing such Expense Amount.
6. Right of Set-off. Upon the occurrence and continuance of
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a Rating Event or of an Amortization Event of the type described in subsection
8.1(a), (b), (i) or (j) of the Purchase Agreement, the Managing Facility Agent
and each Purchaser are hereby irrevocably authorized at any time and from time
to time without notice to RAC, any such notice being hereby waived by RAC, to
set off and appropriate and apply any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether direct or
indirect, absolute or contingent, matured or unmatured, at any time held or
owing by the Managing Facility Agent or such Purchaser to or for the credit or
the account of RAC, or any part thereof in such amounts as the Managing
Facility Agent or such Purchaser may elect, on account of the liabilities of
RAC hereunder and claims of every nature and description of the Managing
Facility Agent or any Purchaser against RAC, whether arising hereunder or under
the Purchase Agreement, as the Managing Facility Agent or such Purchaser may
elect, whether or not the Managing Facility Agent or such Purchaser has made
any demand for payment and although such liabilities and claims may be
contingent or unmatured. The Managing Facility Agent and each Purchaser shall
notify RAC promptly of any such set-off made by it and the application made by
it of the proceeds thereof, provided that the failure to give such notice shall
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not affect the validity of such set-off and application. The rights of the
Managing Facility Agent and each Purchaser under this paragraph are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) which the Managing Facility Agent or such Purchaser may have.
7. No Subrogation, Etc. RAC, the Managing Facility Agent and
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by its acceptance of this Repurchase Agreement and each Purchaser hereby
acknowledges that this Repurchase Agreement constitutes an agreement to
purchase and sell receivables and make yield adjustment payments only.
Notwithstanding anything to the contrary in this Repurchase Agreement, it is
expressly understood that RAC has no right to be subrogated to any of the
rights (whether contractual, under Title 11 of the United States Code,
including Section 509 thereof, under common law or otherwise) of the Managing
Facility Agent and the Purchasers against the Seller or Raytheon Credit or
against any right of offset of the Managing Facility Agent and the Purchasers
with respect to the obligations of the Seller or Raytheon Credit under the
Purchase Agreement. Furthermore, RAC hereby irrevocably waives all contractual,
common law, statutory or other rights of reimbursement, contribution,
exoneration or indemnity (or any similar
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right) from or against Raytheon Credit which may have arisen in connection with
this Repurchase Agreement.
8. Payments. RAC hereby agrees that the RAC Repurchase
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Obligation will be paid to the Managing Facility Agent in immediately available
funds without set-off in U.S. Dollars at the office of the Managing Facility
Agent at the address specified in subsection 11.2 of the Purchase Agreement.
9. Representations and Warranties. RAC represents and
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warrants to the Managing Facility Agent and the Purchasers that:
(a) RAC (i) is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation,
(ii) has the corporate power and authority and the legal right to own and
operate its property, to lease the property it operates and to conduct the
business in which it is currently engaged, (iii) is duly qualified and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification except where the failure so to qualify could not reasonably be
expected to have a material adverse effect on the business, operations,
property or financial or other condition of RAC and its consolidated
Subsidiaries taken as a whole or on the ability of RAC to perform its
obligations hereunder and (iv) is in compliance with all Requirements of Law
except to the extent that the failure to comply therewith could not, in the
aggregate, reasonably be expected to have a material adverse effect on the
business, operations, property or financial or other condition of RAC and its
consolidated Subsidiaries taken as a whole or on the ability of RAC to perform
its obligations hereunder;
(b) RAC has the corporate power and authority and the legal
right to execute and deliver, and to perform its obligations under, this
Repurchase Agreement, and has taken all necessary corporate action to authorize
its execution, delivery and performance of this Repurchase Agreement;
(c) this Repurchase Agreement has been duly executed and
delivered on behalf of RAC and this Repurchase Agreement constitutes a legal,
valid and binding obligation of RAC enforceable in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally (whether enforcement is sought by proceedings in
equity or at law);
(d) the execution, delivery and performance of this Repurchase
Agreement will not violate any provision of any Requirement of Law or
Contractual Obligation of RAC or any of its Material Subsidiaries except to the
extent that such violation could not, in the aggregate, reasonably be expected
to have a material adverse effect on the business, operations, property or
financial or other condition of RAC and its consolidated Subsidiaries taken as
a whole or on the ability of RAC to perform its obligations hereunder, and will
not result in or require the creation or imposition of any Lien on any of the
properties or revenues of RAC or any of its Material Subsidiaries pursuant to
any Requirement of Law or Contractual Obligation of RAC or such Material
Subsidiary;
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(e) no consent or authorization of, filing with, or other act
by or in respect of, any arbitrator or Governmental Authority and no consent of
any other Person (including, without limitation, any stockholder or creditor of
RAC) is required in connection with the execution, delivery, performance,
validity or enforceability of this Repurchase Agreement;
(f) no litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority is pending or, to the knowledge of
RAC, threatened by or against RAC or any of its Material Subsidiaries or
against any of their respective properties or revenues (i) with respect to this
Repurchase Agreement or any of the transactions contemplated hereby or (ii)
which, individually or in the aggregate, could reasonably be expected to have a
material adverse effect on the business, operations, property or financial or
other condition of RAC and its consolidated Subsidiaries taken as a whole or on
the ability of RAC to perform its obligations hereunder; and
(g) no tax Lien has been filed, and, to the knowledge of RAC,
no claim is being asserted, with respect to any such tax, fee or other charge
which could reasonably be expected to have a material adverse effect on the
business, operations, property or financial or other condition of RAC and its
consolidated Subsidiaries taken as a whole or on the ability of RAC to perform
its obligations hereunder.
RAC agrees that the foregoing representations and warranties
shall be deemed to have been made by RAC on each date required by subsection
5.2(a) of the Purchase Agreement.
10. Covenants. RAC hereby agrees that it shall and (except in
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the case of paragraphs (a), (b), (c), (i)(1) and (j) below) shall cause each of
its Material Subsidiaries to:
(a) Promptly give notice to the Managing Facility Agent and
each Purchaser of (i) the occurrence of any Amortization Event or Ineligibility
Event of which it has knowledge and (ii) of any Rating Event, Discount Event or
Remittance Event.
(b) At its own expense, timely and fully perform and comply
with, and enforce and defend, or, with respect to Affiliate Receivables, cause
the related Affiliate Obligor to perform and comply with and enforce and
defend, all material provisions, covenants and other promises (which promises
are required to be observed by it) under the Contracts (other than the payment
by such Affiliate Obligor of the principal of and interest on the promissory
note included in such Contract) and with respect to the Financed Aircraft
related to the Purchased Receivables; and defend the right, title and interest
of the Managing Facility Agent and each Purchaser in and to such Purchased
Receivable, the Collections with respect thereto and the related Contract and
Financed Aircraft against the claims and demands of any Persons whomsoever
(other than of the Managing Facility Agent or any Purchaser).
(c) Not convey, sell, lease, assign, transfer or otherwise
dispose of all or substantially all the property, business or assets of RAC to
any Person or Persons unless such Person or Persons delivers a written
assumption of RAC's obligations under this Repurchase Agreement (which
assumption shall not release RAC hereunder) and a legal opinion with respect
thereto, all satisfactory in form and substance to the Managing Facility Agent
and its counsel.
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(i) Not issue, assume or guarantee any Debt on or after the date
hereof, if such Debt is secured by a mortgage, pledge, security
interest or lien (any mortgage, pledge, security interest or lien
being hereinafter in this subsection 10(d) referred to as a
"mortgage" or "mortgages") upon any Principal Property, or any
shares of stock or indebtedness of any Subsidiary, whether now
owned or hereafter acquired, without in any such case effectively
providing, concurrently with the issuance, assumption or guarantee
of any such Debt, that this Repurchase Agreement (together with, if
RAC shall so determine, any other indebtedness of or guaranteed by
RAC or such Subsidiary ranking equally with this Repurchase
Agreement and then existing or thereafter created) shall be secured
equally and ratably with (or prior to) such Debt; provided however,
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that the foregoing restriction shall not apply to:
(A) mortgages on any Principal Property, shares of stock
or indebtedness of any corporation existing at the time such
corporation becomes a Subsidiary;
(B) mortgages on any Principal Property acquired,
constructed or improved by RAC or any Subsidiary after
the date hereof which are created or assumed
contemporaneously with, or within 90 days after, such
acquisition, construction or improvement to secure or
provide for the payment of the purchase price of such
property or the cost of such construction or improvement
incurred after the date hereof, or, in addition to
mortgages contemplated by clause (C) below, mortgages on
any Principal Property existing at the time of acquisition
thereof; provided, however, that in the case of any such
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acquisition, construction or improvement the mortgage
shall not apply to any property theretofore owned by RAC
or any Subsidiary, other than, in the case of any such
construction or improvement, any theretofore unimproved
real property on which the property so constructed, or the
improvement, is located;
(C) mortgages on any Principal Property or shares of
stock or indebtedness acquired from a corporation which is
merged with or into RAC or a Subsidiary;
(D) mortgages to secure Debt of a Subsidiary to RAC or to
another Subsidiary; and
(E) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in
part, of any mortgage referred to in the foregoing clauses
(A) to (D) inclusive; provided, however, that the
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principal amount of Debt secured thereby shall not exceed
the principal amount of Debt so secured at the time of
such extension, renewal or replacement and that such
extension, renewal or replacement shall be applicable only
to all or a part of the property which secured the
mortgage extended, renewed or replaced (plus improvements
on the property).
11
(ii) RAC will not, nor will it permit any Subsidiary to merge or
consolidate with another corporation, or sell all or substantially
all of its assets to another corporation for a consideration other
than the fair market value thereof which consideration shall
consist of liquid assets (which shall have a fair market value
readily determinable by an independent source), (x) unless, in the
case of a merger or consolidation of RAC or a sale by RAC of
substantially all of its assets, the successor or purchasing
corporation, as applicable, has assumed all of the obligations of
RAC hereunder and (y) if such other corporation has outstanding
obligations secured by a mortgage which, after such merger,
consolidation or sale would extend to any of the assets owned by
RAC or such Subsidiary immediately prior to such merger,
consolidation or sale unless, prior to such merger, consolidation
or sale, RAC or such Subsidiary shall have effectively provided
that this Repurchase Agreement (together with, if RAC or such
Subsidiary shall so determine, any other Debt, indebtedness or
liability issued, assumed or guaranteed by RAC or such Subsidiary,
whether then existing or thereafter created) shall be secured by a
mortgage, the lien of which, upon completion of said merger,
consolidation or sale, will rank prior to the lien of such mortgage
of such other corporation on all assets owned by RAC or such
Subsidiary immediately prior to such merger, consolidation or sale,
which, upon completion of such merger, consolidation or sale, will
be subjected to the lien of such mortgage of such other corporation.
(iii) In the event that RAC shall enter into any indenture or other
agreement or instrument relating to the issuance of Debt
(collectively, referred to herein as an "indenture") and the
---------
provisions of any such indenture with respect to restrictions on
Liens permitted to be created or to exist on any of RAC's property
or the granting of equal and ratable security interests
(collectively, the "Lien Provisions") are more restrictive on RAC
---------------
than this subsection 10(d), then without any action by any Person,
the Lien Provisions shall be deemed to be incorporated by reference
in the provisions of this subsection 10(d) with the obligations
under this Repurchase Agreement constituting the "Debt" for
purposes of such Lien Provision.
(d) Not enter into any material transaction with any
Affiliate (other than a Subsidiary of Raytheon), including, without limitation,
any purchase, sale, lease or exchange of property or the rendering of any
service, unless any such transaction is upon fair and reasonable terms no less
favorable to RAC or such Material Subsidiary, as the case may be, than it would
obtain in a comparable arm's length transaction with a Person not an Affiliate.
(e) Pay, discharge or otherwise satisfy at or before maturity
or before they become delinquent, as the case may be, all obligations of
whatever nature which are material to the business, operations, property or
financial or other condition of RAC and its consolidated Subsidiaries taken as
a whole, except where the amount or validity thereof is currently being
contested in good faith by appropriate proceedings and reserves in conformity
with GAAP with respect thereto have been provided on the books of RAC and its
consolidated Subsidiaries taken as a whole.
(f) Comply, and cause each Affiliate Obligor to comply, in all
respects with all applicable Requirements of Law and all Contractual
Obligations with respect to it, its business
12
and properties and all Purchased Receivables and the related Contracts and
Financed Aircraft except to the extent that the failure to comply therewith
could not, in the aggregate, reasonably be expected to have a material adverse
effect on the business, operations, property or financial or other condition of
RAC and its consolidated Subsidiaries taken as a whole or on the ability of RAC
to perform its obligations hereunder.
(g) Maintain with financially sound and reputable insurance
companies insurance on all its property in at least such amounts and against at
least such risks as are usually insured against in the same general area by
companies engaged in the same or a similar business; and furnish to the
Managing Facility Agent, upon written request of any Purchaser, a schedule of
insurance then in force setting forth (1) the type of coverage, (2) the names
of the insurance carriers, (3) policy numbers, (4) the amount and type of
coverage and (5) the term of each policy, together with a certificate or
certificates of insurance.
(h) Permit representatives of the Managing Facility Agent or
any Purchaser (1) to visit and inspect any of its properties and examine and
make abstracts from any books and records of RAC with respect to the
transactions contemplated by the Purchase Documents at any reasonable time and
as often as may reasonably be necessary and (2) to discuss the business,
operations, properties and financial and other condition of RAC and its
Material Subsidiaries with officers of RAC having knowledge of such matters and
with its independent certified public accountants; provided that any
--------
information, records and materials obtained by the Managing Facility Agent or
any Purchaser pursuant to this section 10(h) shall be used by the Managing
Facility Agent or such Purchaser solely in connection with its participation in
the transactions contemplated by the Purchase Documents (including pursuant to
subsection 11.6(b) and (c) of the Purchase Agreement) and shall be treated as
confidential by the Managing Facility Agent or such Purchaser in accordance
with Section 11.22 of the Purchase Agreement.
11. Severability. Any provision of this Repurchase Agreement
------------
which is 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.
12. Section Headings. The section headings used in this
----------------
Repurchase Agreement are for convenience of reference only and are not to
affect the construction hereof or be taken into consideration in the
interpretation hereof.
13. No Waiver; Cumulative Remedies. Neither the Managing
------------------------------
Facility Agent nor any Purchaser shall by any act (except by a written
instrument pursuant to Section 14 hereof), delay, indulgence, omission or
otherwise be deemed to have waived any right or remedy hereunder or to have
acquiesced in any default or Amortization Event, Ineligibility Event,
Remittance Event, Discount Event or Rating Event, or in any breach of any of
the terms and conditions hereof. No failure to exercise, nor any delay in
exercising, on the part of the Managing Facility Agent or any Purchaser, any
right, power or privilege hereunder shall operate as a waiver thereof. No single
or partial exercise of any right, power or privilege hereunder shall preclude
any other or further exercise thereof or the exercise of any other right, power
or
13
privilege. A waiver by the Managing Facility Agent or any Purchaser of any
right or remedy hereunder on any one occasion shall not be construed as a bar
to any right or remedy which the Managing Facility Agent or such Purchaser
would otherwise have on any future occasion. The rights and remedies herein
provided are cumulative, may be exercised singly or concurrently and are not
exclusive of any rights or remedies provided by law.
14. Waivers and Amendments; Successors and Assigns. None of
----------------------------------------------
the terms or provisions of this Repurchase Agreement may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
RAC and the Managing Facility Agent in accordance with the Purchase Agreement.
This Repurchase Agreement shall be binding upon the successors and assigns of
RAC and shall inure to the benefit of the Managing Facility Agent and the
Purchasers and their successors and assigns.
15. GOVERNING LAW. THIS REPURCHASE AGREEMENT AND THE
-------------
OBLIGATIONS OF RAC HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
16. Notices. All notices by the Managing Facility Agent to
-------
RAC hereunder to be effective shall be in writing (including by telecopy or
telex), and shall be deemed to have been duly given or made (a) when delivered
by hand, (b) in the case of mail, three Business Days after deposit in the
mail, postage prepaid, (c) in the case of telecopy notice, when received, or
(d) in the case of telex notice, when sent, answerback received, addressed to
RAC at its address or transmission number set forth under its signature below.
RAC may change its address and transmission numbers by written notice to the
Managing Facility Agent.
17. Authority of Managing Facility Agent. RAC acknowledges
------------------------------------
that the rights and responsibilities of the Managing Facility Agent under this
Repurchase Agreement with respect to any action taken by the Managing Facility
Agent or the exercise or non-exercise by the Managing Facility Agent of any
option, right, request, judgment or other right or remedy provided for herein
or resulting or arising out of this Repurchase Agreement shall, as between the
Managing Facility Agent and the Purchasers, be governed by the Purchase
Agreement and by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Managing Facility Agent and RAC,
the Managing Facility Agent shall be conclusively presumed to be acting as
agent for the Purchasers with full and valid authority so to act or refrain
from acting, and RAC shall not be under any obligation, or entitlement, to make
any inquiry respecting such authority.
18. Waiver. Each of the Managing Facility Agent and, by its
------
acceptance of this Repurchase Agreement, each Purchaser hereby irrevocably and
unconditionally waives, to the maximum extent not prohibited by law, any right
the Managing Facility Agent or such Purchaser may have to claim or recover in
any legal action or proceeding relating to this Repurchase Agreement any
special, exemplary, punitive or consequential damages; provided that the waiver
--------
contained in this Section 18 shall not extend to any right to claim or recover
from RAC any special, exemplary, punitive or consequential damages for which
the Managing
14
Facility Agent or any Purchaser is liable to any Person (other than an
Affiliate of the Managing Facility Agent or such Purchaser).
19. Acknowledgements. RAC hereby acknowledges with respect to
----------------
the transactions contemplated by the Purchase Documents that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Repurchase Agreement;
(b) neither the Managing Facility Agent nor any Purchaser has
any fiduciary relationship to RAC or the Seller and the relationship between
the Managing Facility Agent and the Purchasers, on the one hand, and RAC or the
Seller, on the other hand, is solely that of debtor and creditor; and
(c) no joint venture exists among the Purchasers, among the
Seller, the Managing Facility Agent and the Purchasers or among RAC, the
Managing Facility Agent and the Purchasers.
20. WAIVERS OF JURY TRIAL. RAC AND, BY THEIR ACCEPTANCE
---------------------
HEREOF, THE MANAGING FACILITY AGENT AND THE PURCHASERS HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS REPURCHASE AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.
21. Submission To Jurisdiction; Waivers. RAC hereby
------------------------------------
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Repurchase Agreement, or for recognition and
enforcement of any judgment in respect thereof, to the non-exclusive general
jurisdiction of the courts of the State of New York, the courts of the United
States of America for the Southern District of New York, and appellate courts
from any thereof;
(b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or thereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
(c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to it at its
address set forth below its signature hereto or at such other address of which
the Managing Facility Agent shall have been notified pursuant hereto;
(d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to xxx in any other jurisdiction; and
15
(e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding
referred to in this subsection any special, exemplary, punitive or
consequential damages.
22. Travel Air Performance Guarantee. (a) RAC agrees with the
--------------------------------
Managing Facility Agent for the ratable benefit of the Managing Facility Agent
and the Purchasers that RAC will cause Travel Air duly and punctually to
perform and observe all of its terms, conditions, covenants, agreements and
indemnities under the Travel Air Contracts executed and outstanding with any
Obligor(s) under a Travel Air Receivable that is a Purchased Receivable, and
any other document executed and delivered by Travel Air in connection therewith
or related thereto (including any agreement between Travel Air and the Seller
or the Servicer relating to Travel Air's obligations upon a default by an
Obligor under a Purchased Travel Air Receivable; collectively, the "Travel Air
----------
Documents"), strictly in accordance with the terms thereof, and that if for any
---------
reason whatsoever Travel Air shall fail so to perform and observe the terms,
conditions, covenants, agreements and indemnities referred to above, RAC will
duly and punctually perform and observe the same (the obligations in this
subsection 22(a), collectively, the "Performance Guarantee").
---------------------
(b) RAC shall remain obligated hereunder notwithstanding that,
without any reservation of rights against RAC, and without notice to or further
assent by RAC, any demand for performance or observance under the Travel Air
Documents or any Travel Air Receivable made by the Managing Facility Agent or
any Purchaser may be rescinded by the Managing Facility Agent or such
Purchaser, and any of the obligations of Travel Air or any Obligor(s),
respectively, thereunder may be continued, and the obligations of Travel Air
under the Travel Air Documents and of the Obligor(s) under any Travel Air
Receivables or the liability of any other party upon or for any part thereof,
or any collateral security or guarantee therefor or right of offset with
respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or
released by the Managing Facility Agent or any Purchaser, and the Purchase
Agreement, the Guarantee, any other Purchase Document or any other documents
executed and delivered in connection therewith may be amended, modified,
supplemented or terminated, in whole or in part, as the Purchasers (or the
Required Purchasers, as the case may be) may deem advisable from time to time.
(c) RAC waives any and all notice of the creation, renewal,
extension or accrual of any of the obligations of Travel Air under the Travel
Air Documents and notice of or proof of reliance by the Managing Facility Agent
or any Purchaser upon the Performance Guarantee or acceptance of the
Performance Guarantee; the obligations of the Purchasers under the Purchase
Agreement shall conclusively be deemed to have been created, contracted or
incurred in reliance upon the Performance Guarantee; and all dealings between
Travel Air and RAC, on the one hand, and the Managing Facility Agent and the
Purchasers, on the other, shall likewise be conclusively presumed to have been
had or consummated in reliance upon the Performance Guarantee. RAC waives
diligence, presentment, protest, demand for payment and notice of default or
nonpayment to or upon Travel Air or RAC with respect to the obligations of
Travel Air under the Travel Air Documents. The Performance Guarantee shall be
construed as a continuing, absolute and unconditional guarantee without regard
to (1) the validity or enforceability of the Travel Air Documents, the Purchase
Agreement, the Guarantee, the
16
Assignments, the FAA Assignments, the Foreign Assignments, the Bailment
Agreement or any other document or instrument executed in connection with any
of the foregoing documents, any of the Obligations or any collateral security
therefor or guarantee or right of offset with respect thereto at any time or
from time to time held by the Managing Facility Agent or any Purchaser, (2) any
defense which relates, directly or indirectly, to the matters covered by the
representations and warranties set forth in Section 4 of the Purchase Agreement
or Section 9 of this Repurchase Agreement or set-off which in either case may
at any time be available to or be asserted by Travel Air or RAC against the
Managing Facility Agent or any Purchaser, or (3) any other circumstance
whatsoever (with or without notice to or knowledge of Travel Air or RAC) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of Travel Air or RAC for the obligations of Travel Air under the
Travel Air Documents, or of RAC under the Performance Guarantee, in bankruptcy
or in any other instance; provided that this clause (c) shall not prevent RAC
--------
from being discharged from its obligations under the Performance Guarantee
pursuant to confirmation of a plan of reorganization under Chapter 11 of the
United States Code in a case in which RAC is the debtor. When the Managing
Facility Agent or any Purchaser is pursuing its rights and remedies hereunder
against RAC, the Managing Facility Agent or such Purchaser may, but shall be
under no obligation to, pursue such rights and remedies as it may have against
Travel Air or RAC or any other Person or against any collateral security or
guarantee for the obligations of Travel Air under the Travel Air Documents or
any right of offset with respect thereto, and any failure by the Managing
Facility Agent or any Purchaser to pursue such other rights or remedies or to
collect any payments from Travel Air or RAC or any such other Person or to
realize upon any such collateral security or guarantee or to exercise any such
right of offset, or any release of Travel Air or RAC or any such other Person
or of any such collateral security, guarantee or right of offset, shall not
relieve RAC of any liability hereunder, and shall not impair or affect the
rights and remedies, whether express, implied or available as a matter of law,
of the Managing Facility Agent and the Purchasers against RAC.
(d) The Performance Guarantee shall continue to be effective,
or be reinstated, as the case may be, if at any time payment, or any part
thereof, of any of the obligations of Travel Air under the Travel Air Documents
is rescinded or must otherwise be restored or returned by the Managing Facility
Agent or any Purchaser upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of Travel Air or RAC or upon or as a result of
the appointment of a receiver, intervenor or conservator of, or trustee or
similar officer for, Travel Air or RAC or any substantial part of its property,
or otherwise, all as though such payments had not been made.
(e) Notwithstanding anything to the contrary in this Section
22, RAC hereby irrevocably waives all rights which may have arisen in
connection with this Performance Guarantee to be subrogated to any of the
rights (whether contractual, under Title 11 of the United States Code,
including Section 509 thereof, under common law or otherwise) of the Managing
Facility Agent and the Purchasers against Travel Air or against any right of
offset of the Managing Facility Agent and the Purchasers with respect to the
obligations of Travel Air under the Travel Air Documents. RAC hereby further
irrevocably waives all contractual, common law, statutory or other rights of
reimbursement, contribution, exoneration or indemnity (or any similar right)
from or against Travel Air or any other Person which may have arisen in
connection with this Performance Guarantee. The provisions of this subsection
22(e) shall survive the termination of the Purchase Agreement and the payment
in full of the Obligations; provided that
--------
17
the foregoing waiver shall be of no force and effect 370 days following the
termination of the Purchase Agreement and the payment in full of the
Obligations but only if during such 370-day period none of the Seller, the
Servicer or RAC shall have commenced or have commenced against it a bankruptcy
proceeding under Title 11 of the United States Code.
23. Amendment and Restatement of Purchase and Sale Agreement.
--------------------------------------------------------
RAC hereby consents to the amendments to the Third Amended and Restated
Purchase and Sale Agreement and to the execution of the Purchase Agreement by
Raytheon Credit and the Seller.
IN WITNESS WHEREOF, RAC has caused this Repurchase
Agreement to be duly executed and delivered in New York, New York by its proper
and duly authorized officer as of the day and year first above written.
RAYTHEON AIRCRAFT COMPANY
By: ________________________
Name:
Title:
Address for Notices:
Raytheon Aircraft Company
0000 Xxxx Xxxxxxx
Xxxxxxx, Xxxxxx 00000
Attention:
Telecopy:
Acknowledged By:
BANK OF AMERICA, N.A.,
as Managing Facility Agent
By: __________________________
Name:
Title:
