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EXECUTION COPY
AMENDED AND RESTATED
PURCHASE AND CONTRIBUTION AGREEMENT
DATED AS OF MARCH 31, 2000
BETWEEN
HPSC BRAVO FUNDING CORP.,
AS THE BUYER
AND
HPSC, INC.,
AS THE SELLER AND AS SERVICER
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS............................................................................................1
SECTION 1.01. Certain Defined Terms.........................................................................1
SECTION 1.02. Other Terms...................................................................................1
SECTION 1.03. Computation of Time Periods...................................................................1
ARTICLE II AMOUNTS AND TERMS OF THE PURCHASES....................................................................2
SECTION 2.01. Agreement to Sell and Contribute..............................................................2
SECTION 2.02. Purchases from the Seller.....................................................................2
SECTION 2.03. Servicing of Contracts and Equipment..........................................................3
SECTION 2.04. Transfer of Records...........................................................................3
SECTION 2.05. Collections; Deemed Collections...............................................................4
SECTION 2.06. Payments and Computations, Etc................................................................5
SECTION 2.07. Perfection of Liens; Further Assurances.......................................................5
ARTICLE III CONDITIONS OF PURCHASES..............................................................................6
SECTION 3.01. Conditions Precedent to Initial Purchase......................................................6
SECTION 3.02. Conditions Precedent to All Purchases.........................................................6
SECTION 3.03. Effect of Payment of Purchase Price...........................................................7
ARTICLE IV REPRESENTATIONS AND WARRANTIES........................................................................7
SECTION 4.01. Representations and Warranties of the Seller..................................................7
ARTICLE V GENERAL COVENANTS OF THE SELLER.......................................................................13
SECTION 5.01. Affirmative Covenants of the Seller..........................................................13
SECTION 5.02. Reporting Requirements of the Seller.........................................................16
SECTION 5.03. Negative Covenants of the Seller.............................................................17
SECTION 5.04. Financial Covenants of the Seller............................................................19
ARTICLE VI ADMINISTRATION AND COLLECTION........................................................................21
SECTION 6.01. Designation of Servicer......................................................................21
SECTION 6.02. Duties of the Servicer.......................................................................22
SECTION 6.03. Rights of the Buyer..........................................................................24
SECTION 6.04. Further Action Evidencing Transfers..........................................................25
SECTION 6.05. Responsibilities of the Seller...............................................................25
SECTION 6.06. Administration of Collections by Servicer....................................................25
SECTION 6.07. Application of Collections...................................................................26
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SECTION 6.08. Servicing Fee................................................................................26
SECTION 6.09. Resignation; Successor Servicer..............................................................26
ARTICLE VII EVENTS OF TERMINATION...............................................................................27
SECTION 7.01. Events of Termination........................................................................27
ARTICLE VIII INDEMNIFICATION....................................................................................29
SECTION 8.01. Indemnities by the Seller....................................................................29
ARTICLE IX MISCELLANEOUS........................................................................................31
SECTION 9.01. Amendments, Etc..............................................................................31
SECTION 9.02. Notices, Etc.................................................................................31
SECTION 9.03. No Waiver; Remedies..........................................................................31
SECTION 9.04. Binding Effect; Assignability................................................................32
SECTION 9.05. GOVERNING LAW; WAIVER OF JURY TRIAL..........................................................32
SECTION 9.06. Costs, Expenses and Taxes....................................................................33
SECTION 9.07. Execution in Counterparts; Severability......................................................33
SECTION 9.08. Reference to and Effect on Prior PCA.........................................................34
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LIST OF EXHIBITS
EXHIBIT A List of Contracts
EXHIBIT B Form of Notice of Assignment
EXHIBIT C Form of Settlement Report
EXHIBIT D Description of Credit and Collection Policy
EXHIBIT E Form of Opinion(s) of Counsel for Seller
EXHIBIT F List of Offices of Seller where Records Are Kept
EXHIBIT G Form of Lock-Box Agreement
EXHIBIT H List of Lock-Box Banks
EXHIBIT I Trade Names and Assumed Names
EXHIBIT J List of Computer Software
EXHIBIT K-1 Form of Lease
EXHIBIT K-2 Form of Finance Agreement
EXHIBIT K-3 Form of Leasehold Improvement Note
EXHIBIT K-4 Form of Practice Finance Loan and Practice Finance Loan
Underwriting Criteria
EXHIBIT K-5 Forms of Related Contract Documents
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AMENDED AND RESTATED
PURCHASE AND CONTRIBUTION AGREEMENT
DATED AS OF MARCH 31, 2000
HPSC BRAVO FUNDING CORP., a Delaware corporation (the "Buyer"), and
HPSC, INC., a Delaware corporation, (the "Seller") agree as follows:
PRELIMINARY STATEMENTS. (1) Certain terms which are capitalized and
used throughout this Agreement (in addition to those defined above) are defined
in the "Definitions List" (as defined in Article I of this Agreement).
(2) The Seller and the Buyer are parties to that certain Purchase and
Contribution Agreement, dated as of January 31, 1995 (as amended, the "Prior
PCA").
(3) The Seller and the Buyer have agreed to amend and restate the
Prior PCA in its entirety as follows:
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this Agreement,
capitalized terms used herein shall, unless otherwise defined herein, have the
meanings assigned to them in the Definitions List dated as of the date hereof
that refers to this Agreement (the "DEFINITIONS LIST"), the terms of which are
incorporated herein by reference (such meanings to be equally applicable to both
the singular and plural forms of the terms defined). Any reference in the
Facility Documents to a note, instrument, or other agreement substantially in
the form of Exhibit K-1, K-2, K-3, or K-4 to this Agreement, as applicable,
shall mean and be a reference to a note, instrument or other agreement in
substantially one of the forms included in such Exhibit.
(a) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to Sections, subsections, Schedules and
Exhibits of this Agreement unless otherwise specified.
SECTION 1.02. OTHER TERMS. 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.
SECTION 1.03. COMPUTATION OF TIME PERIODS. Unless otherwise stated in
this Agreement, in the computation of a period of time from a specified date to
a later specified date,
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the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding."
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01. AGREEMENT TO SELL AND CONTRIBUTE. On the terms and
conditions hereinafter set forth, the Seller hereby agrees, from time to time
until the Termination Date, to sell in part and to contribute in part to the
Buyer, and the Buyer hereby agrees, from time to time until the Termination
Date, to purchase and acquire from the Seller, all of the Seller's right, title
and interest in, to and under the Receivables, the Contracts, all Equipment, all
Related Security with respect to the foregoing, and all Collections and other
proceeds of the foregoing. Except as provided in the immediately succeeding
sentence, nothing contained in this Agreement is intended to, nor shall it be
deemed to, constitute a commitment on the part of the Seller or on the part of
the Buyer to consummate any Purchase hereunder, it being understood that all
such Purchases shall be made at the discretion of each such party but otherwise
subject to the terms and conditions set forth herein. Notwithstanding the
foregoing, the Buyer agrees, subject to the satisfaction of the conditions set
forth in SECTION 3.02, to consummate any Purchase requested by the Seller
pursuant to SECTION 2.02(b) for which the notice of purchase specifies that the
entire Purchase Price shall be paid as a contribution to the Buyer's capital and
not in cash. Nothing contained in this Agreement is intended to, nor shall it be
deemed to, constitute an assumption by the Buyer of any obligation under any
Contract, all of which obligations shall be retained by the Seller, and the
Seller hereby agrees to perform all such obligations.
(a) It is the intent of the Seller and the Buyer that the transfer by
the Seller to the Buyer of the Transferred Assets constitute a sale, in part,
and a contribution to capital, in part, which sales and contributions are
absolute and irrevocable, without recourse except as otherwise provided in this
Agreement, and will provide the Buyer with full ownership of the Transferred
Assets. Each of Seller and the Buyer hereby agrees to treat such transfer as a
sale and a contribution for tax, reporting and accounting purposes (except to
the extent that such transfer is not recognized due to the reporting of taxes on
a consolidated basis where applicable and the application of consolidated
financial reporting principles under GAAP). The Seller agrees to respond to any
inquiries with respect to the transfer hereunder by confirming the sale and
contribution of the Receivables, Contracts and the Equipment to the Buyer, and
to note on its financial statements that such Receivables, Contracts and
Equipment have been sold and/or contributed to the Buyer.
SECTION 2.02. PURCHASES FROM THE SELLER. On the Closing Date, the
Seller shall sell to the Buyer, and the Buyer shall purchase from the Seller,
all of the Transferred Assets arising under or in connection with the Contracts
described on EXHIBIT A hereto in consideration of which the Buyer will pay to
the Seller $8,000.000 in cash. The remaining portion of such Transferred Assets
shall be a contribution to the capital of the Buyer in return for 999 shares of
the capital stock of the Buyer.
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(a) Each Purchase subsequent to the Closing Date shall be made on a
Settlement Date upon not less than three Business Days' prior written notice to
the Buyer requesting such Purchase, which notice shall contain a supplemental
EXHIBIT A hereto setting forth a list of the Contracts to be transferred to the
Buyer on such Settlement Date. Each such notice of a proposed Purchase shall
accompany a Settlement Report and shall specify that portion of the Purchase
Price which is payable in cash for the Transferred Assets to be transferred.
Such notice shall be accompanied by a certification from the Seller that, after
giving effect to the Purchase proposed in such notice, the conditions set forth
in SECTION 3.02 hereto shall have been satisfied. The purchase price (the
"PURCHASE PRICE") for the new Transferred Assets included in any Purchase shall
be agreed to in writing by the Buyer and the Seller on or before the applicable
Settlement Date and shall be an amount not less than 95% nor more than 100%
TIMES the aggregate Discounted Receivables Balance of the Receivables included
in such Purchase.
(b) Except as otherwise provided below in this SECTION 2.02, the
Purchase Price for the Transferred Assets sold by the Seller under this
Agreement shall be payable in full in cash by the Buyer, in each case on the
date of each such Purchase, except that the Buyer may, with respect to any
Purchase, offset against such Purchase Price any amounts owed by the Seller to
the Buyer hereunder and which remain unpaid. On the date of each Purchase, the
Buyer shall, upon satisfaction of the applicable conditions set forth in ARTICLE
III, make available to the Seller the portion of the Purchase Price payable in
cash referred to above in same day funds.
(c) If, on any Settlement Date, the Buyer has insufficient funds to
pay in full the Purchase Price owed on such day, then the Buyer shall so notify
the Seller prior to consummating such Purchase and the Seller shall, by
accepting the cash proceeds tendered by the Buyer, be deemed to have contributed
to the capital of the Buyer Transferred Assets having a Purchase Price equal to
the otherwise unpaid portion of the total Purchase Price otherwise owed on such
day.
(d) Promptly after each Purchase hereunder (including the initial
Purchase), the Seller will send to each Obligor under the Contracts included in
such Purchase, with the next invoice sent to such Obligor, a Notice of
Assignment, substantially in the form attached hereto as EXHIBIT B, which shall,
inter alia, advise such Obligor of the absolute transfer by the Seller to the
Buyer of that Obligor's Contract, including the Receivables due thereunder, and
any related Equipment.
SECTION 2.03. SERVICING OF CONTRACTS AND EQUIPMENT. In connection with
the contribution, assignment, transfer, sale and conveyance of the Transferred
Assets to the Buyer, the Seller hereby agrees to service the Contracts and
Equipment for the benefit of the Buyer and its successors and assigns in
accordance with the terms and provisions of ARTICLE VI hereof.
SECTION 2.04. TRANSFER OF RECORDS. (a) The transfer of Transferred
Assets hereunder shall include the transfer to the Buyer of all of the Seller's
right and title to and interest in the Records relating to such Transferred
Assets, which transfer shall be effected automatically
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on the Purchase Date for such Transferred Assets without any further
documentation. In connection with such transfer, the Seller hereby grants to the
Buyer an irrevocable, non-exclusive license to use, without royalty or payment
of any kind, all software used by the Seller to account for the Receivables and
the Contracts, to the extent necessary to administer the Transferred Assets,
whether such software is owned by the Seller or is owned by others and used by
the Seller under license agreements with respect thereto, such use to be subject
to the terms and conditions of any such license agreements with third parties
where applicable. The license granted hereby shall be irrevocable, and shall
terminate on the date on which the aggregate Receivables Balance shall have been
reduced to zero.
(b) The Seller shall take such action requested by the Buyer, from
time to time hereafter, that may be necessary or appropriate to ensure that the
Buyer and its assigns have (i) an enforceable ownership interest in the Records
relating to the Transferred Assets and (ii) an enforceable right (whether by
license or sublicense or otherwise) to use all of the computer software used to
account for the Transferred Assets and/or to recreate such Records, such use to
be subject to the terms and conditions of any license agreements with third
parties pursuant to which the Seller has the right to use the applicable
computer software.
SECTION 2.05. COLLECTIONS; DEEMED COLLECTIONS. (a) Any Collections of
Receivables received (or deemed to have been received) by the Seller shall be
remitted directly to the Buyer by depositing such Collections in the Lock-box
Account within one Business Day of Seller's receipt.
(b) If on any day the Outstanding Balance of any Receivable is either (i)
reduced or adjusted as a result of any defective, rejected, returned,
repossessed or foreclosed merchandise, any defective or rejected services, any
cash discount or any other adjustment made or performed by the Seller or any
other Person (including, without limitation, those described in the definition
of "DILUTION FACTORS"), or (ii) reduced or cancelled as a result of a setoff in
respect of any claim by the Obligor thereof against the Seller or any other
Person (whether such claim arises out of the same or a related transaction or an
unrelated transaction), the Seller shall be deemed to have received on such day
a Collection of such Receivable in the amount of such reduction, cancellation or
adjustment. If on any day any of the representations or warranties in the first
sentence of SECTION 4.01(h) is no longer true with respect to a Receivable or if
the Seller has breached its obligations under SECTION 5.01(j), then the Seller
shall be deemed to have received on such day a Collection of such Receivable:
(x) if such representation, warranty or covenant relates to the non-existence of
any Adverse Claims, the Seller shall be deemed to have received a Collection of
such Receivable in the dollar amount of the Adverse Claims attaching thereto and
(y) if such representation or warranty relates to the validity or perfection of
the transfer of such Receivable under this Agreement or the perfection of the
Buyer's security interest in any Equipment as against the Obligor thereunder,
then the Seller be deemed to have received a Collection of such Receivable in an
amount equal to the Outstanding Balance thereof. To the extent that any such
deemed Collection reduces the Outstanding Balance of such Receivable to zero,
then, upon the Seller's payment to the Buyer of such deemed Collection, the
Buyer shall re-assign to the Seller all of its right, title and interest in and
to the relevant
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Receivable, the Contract under which such Receivable arose and the Related
Security relating thereto. Prior to the 15th day of each month (or if such day
is not a Business Day, the immediately succeeding Business Day), the Seller
shall prepare and forward to the Buyer, a Settlement Report as of the close of
business of the Seller on the last day of the immediately preceding month, in
substantially the form set forth in EXHIBIT C.
(c) Although the Seller and the Buyer agree that the Seller (except in
its capacity as Servicer pursuant to SECTION 6.02(a)), shall have no right to so
terminate, reject or not assume a Contract, if the Seller in its capacity as
Servicer (or its successor in interest, including a trustee appointed under the
Bankruptcy Code) terminates, rejects or does not assume a Contract, in whole or
in part, prior to the expiration of the original term of such Contract, whether
such rejection, termination or non-assumption is made pursuant to an equitable
cause, statute, regulation, judicial proceeding or other applicable law
(including, without limitation, Section 365 of the Bankruptcy Code), then (i)
the Seller shall be deemed to have received Collections with respect to
Receivables arising under such Contract in an amount equal to (A) in the event
of a prepayment or termination consented to by the Seller at the Obligor's
request, the excess, if any, of the Termination Amount over all amounts paid by
the Obligor on account of such termination or (B) in the event of any other
rejection or non-assumption, the amount, of the Outstanding Balance thereof that
has not been, or may not be paid as a result of such rejection, termination or
non-assumption. Upon the Seller's payment of any such deemed Collections
described in this SECTION 2.05(c), the Buyer shall re-assign to the Seller all
of its right, title and interest in and to the relevant Receivable or
Receivables, the Contracts under which such Receivable(s) arose and the Related
Security relating thereto.
SECTION 2.06. PAYMENTS AND COMPUTATIONS, ETC. Except as otherwise
provided herein, all amounts to be paid or deposited by the Seller hereunder
shall be paid or deposited in accordance with the terms hereof no later than
11:00 A.M. (New York City time) on the day when due in lawful money of the
United States of America in immediately available funds to a special account in
the name of Buyer and maintained at Bank of Boston. The Seller shall, to the
extent permitted by law, pay to the Buyer interest on all amounts not paid or
deposited when due hereunder (whether owing by the Seller individually or as
Servicer) at 2% per annum above the Base Rate, payable on demand; PROVIDED,
HOWEVER, that such interest rate shall not at any time exceed the maximum rate
permitted by applicable law. All computations of interest and other fees
hereunder shall be made on the basis of a year of 360 days for the actual number
of days (including the first but excluding the last day) elapsed.
SECTION 2.07. PERFECTION OF LIENS; FURTHER ASSURANCES. Upon the
request of the Buyer, the Seller shall, at its expense, promptly execute and
deliver all further instruments and documents, and take all further action
(including, without limitation, the execution and filing of such financing or
continuation statements, or amendments thereto or assignments thereof), that may
be necessary or desirable, or that the Buyer may request, in order to (i)
perfect and protect any security interest granted or purported to be granted by
an Obligor under any Contract and (ii) perfect and protect any ownership or
security interest granted or purported to be granted to the Buyer hereunder or
(iii) to enable the Buyer to exercise and enforce its rights and remedies
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hereunder with respect to any Transferred Assets; PROVIDED that the Seller shall
not be required to file financing statements or to maintain the effectiveness of
previously filed financing statements with respect to any Receivables the
Outstanding Balance of which originally is or has thereafter been reduced below
$5,000, respectively, so long as the aggregate Outstanding Balance of
Receivables for which no such financing statements are in effect at any time
remains less than 7.5% of the Discounted Eligible Receivables Balance at such
time; PROVIDED that such seven and one-half percent limitation shall not apply
from and after the Termination Date unless and to the extent that the Buyer or
the Collateral Agent on its behalf specifically requests otherwise.
ARTICLE III
CONDITIONS OF PURCHASES
SECTION 3.01. CONDITIONS PRECEDENT TO INITIAL PURCHASE. The first
Purchase hereunder after the date hereof shall be subject to the condition
precedent that the Buyer shall have received the following, each in form and
substance satisfactory to the Buyer:
(a) The Certificate for the Buyer;
(b) This Purchase Agreement executed by the Buyer and the Seller;
(c) A fully executed copy of the Triple-A Purchase Agreement;
(d) A copy of the resolutions of the Board of Directors of the Seller
approving this Purchase Agreement and the other Facility Documents to be
delivered by it hereunder and the transactions contemplated hereby, certified by
its Secretary or Assistant Secretary;
(e) The Certificate of Incorporation of the Seller certified by the
Secretary of State of Delaware;
(f) Good Standing Certificates for the Seller issued by the
Secretaries of State of Delaware and Massachusetts; and
(g) A certificate of the Secretary or Assistant Secretary of the
Seller certifying (i) the names and true signatures of the officers authorized
on its behalf to sign this Agreement and the other Facility Documents to be
delivered by it hereunder (on which certificate the Buyer (and the Collateral
Agent) may conclusively rely until such time as the Buyer (and the Collateral
Agent) shall receive from the Seller a revised certificate meeting the
requirements of this subsection (g)) and (ii) a copy of the Seller's by-laws.
SECTION 3.02. CONDITIONS PRECEDENT TO ALL PURCHASES. Each Purchase
(including the initial Purchase) by the Buyer from the Seller shall be subject
to the further conditions precedent that (a) with respect to any such Purchase,
on or prior to the date of such Purchase, the Seller shall have delivered to the
Buyer (i) in form and substance satisfactory to the Buyer, a completed
Settlement Report as of the end of the immediately preceding calendar month and
containing such additional information as may be reasonably requested by the
Buyer,
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(ii) a notice of purchase and list of the Contracts to be purchased as provided
in SECTION 2.02(b), (iii) a completed Certificate with respect to such Contracts
and (iv) a notice from the Custodian in substantially the form of Exhibit A to
the Custodial Agreement confirming that the Custodian has received the Contract
Files for each Contract to be included in such Purchase; (b) on the date of such
Purchase the following statements shall be true and the Seller by accepting the
cash portion of the Purchase Price shall be deemed to have certified that:
(i) The representations and warranties contained in SECTION 4.01
are correct on and as of such day as though made on and as of
such date and
(ii) No event has occurred and is continuing, or would result
from such Purchase which constitutes an Event of Termination or
would constitute an Event of Termination but for the requirement
that notice be given or time elapse or both; and
(iii) the Buyer shall have received such other approvals or
documents as the Buyer may reasonably request.
SECTION 3.03. EFFECT OF PAYMENT OF PURCHASE PRICE. Upon the payment of
the Purchase Price for any Purchase, (whether in cash or through a capital
contribution), title to the related Transferred Assets shall vest in the Buyer,
whether or not the conditions precedent to such Purchase were in fact satisfied;
PROVIDED, HOWEVER, that the Buyer shall not be deemed to have waived any claim
it may have under this Agreement for the failure by the Seller in fact to
satisfy any such condition precedent.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller
represents and warrants as follows:
(a) DUE INCORPORATION AND GOOD STANDING. The Seller is a corporation
duly incorporated, validly existing and in good standing under the laws of the
jurisdiction named at the beginning hereof and is duly qualified to do business,
and is in good standing, in every jurisdiction in which the nature of its
business requires it to be so qualified, except where the failure to be so
qualified would not materially adversely affect (i) the interests hereunder of
the Buyer, (ii) the collectibility of any Receivable, (iii) the business,
properties, operations, prospects, profits or condition (financial or otherwise)
of the Seller or (iv) the ability of the Seller (individually or as Servicer) to
perform its obligations hereunder.
(b) DUE AUTHORIZATION AND NO CONFLICT. The execution, delivery and
performance by the Seller of this Agreement, the Certificate, and all other
agreements, instruments and documents to be delivered hereunder, and the
transactions contemplated hereby and thereby (including the sale and
contribution to the Buyer of the Transferred Assets contemplated hereunder), are
within the Seller's corporate powers, have been duly authorized by all necessary
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corporate action, do not contravene (i) the Seller's charter or by-laws, (ii)
any law, rule or regulation applicable to the Seller, (iii) any contractual
restriction contained in any material indenture, loan or credit agreement,
lease, mortgage, security agreement, bond, note, or other agreement or
instrument binding on or affecting the Seller or its property or (iv) any order,
writ, judgment, award, injunction or decree binding on or affecting the Seller
or its property, and do not result in or require the creation of any Adverse
Claim upon or with respect to any of its properties (other than in favor of the
Buyer as contemplated hereunder); and no transaction contemplated hereby
requires compliance with any bulk sales act or similar law. This Agreement and
the Certificate have been duly executed and delivered on behalf of the Seller.
(c) GOVERNMENTAL AND OTHER CONSENTS. Except for the filing of
financing statements pursuant to the UCC required to perfect the sales of
accounts and chattel paper under this Agreement and the security interests
granted under the Credit Agreement or under the other Facility Documents and
except for consents under certain contractual agreements which have been
obtained, no authorization, consent, approval or other action by, and no
registration, qualification, designation, declaration, notice to or filing with,
any governmental authority or other Person is or will be necessary in connection
with the execution and delivery of this Agreement, the Certificate or any other
Facility Document to which the Seller is a party, or any of the other documents
contemplated hereby or thereby, consummation of the transactions herein or
therein contemplated, or performance of or compliance with the terms and
conditions hereof or thereof, to ensure the legality, validity or enforceability
hereof or thereof.
(d) ENFORCEABILITY OF FACILITY DOCUMENTS. This Agreement, the
Certificate and each other Facility Documents to be delivered by the Seller in
connection herewith constitute the legal, valid and binding obligations of the
Seller enforceable against the Seller in accordance with their respective terms,
except as enforceability may be limited by bankruptcy, insolvency or similar
laws relating to or affecting creditors' rights generally and by equitable
principles.
(e) FINANCIAL STATEMENTS. (i) The consolidated balance sheets of the
Seller and its consolidated Subsidiaries as at December 31, 1998, and the
related statements of income, retained earnings and cash flows of the Seller and
its consolidated Subsidiaries for the fiscal year then ended, certified by
Deloitte & Touche, independent public accountants, and the unaudited interim
consolidated balance sheets of the Seller and its subsidiaries as of June 30,
1999 and September 30, 1999 and the related consolidated statements of income,
retained earnings and cash flows for the six months and nine months,
respectively, ending on such dates (the "Interim Financials"), in each case
fairly present the consolidated financial condition of the Seller and its
consolidated Subsidiaries as at such dates and the consolidated results of the
operations of the Seller and its consolidated Subsidiaries for the period ended
on such dates, all in accordance with GAAP, and since December 31, 1998, there
has been no material adverse change in any such condition or operations, except
as reflected in the Interim Financials. Neither the Seller nor any of its
subsidiaries has any material liabilities or obligations other than those
disclosed in the financial statements referred to above or for which adequate
reserves are reflected in such financial statements.
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(f) NO LITIGATION. There are no actions, suits or proceedings pending,
or to the knowledge of the Seller threatened, against or affecting the Seller or
any of its Subsidiaries, or the property of the Seller or any of its
Subsidiaries, in any court, or before any arbitrator of any kind, or before or
by any governmental body, which may materially adversely affect (i) the
business, properties, operations, prospects, profits or condition (financial or
otherwise) financial condition of the Seller or (ii) the ability of the Seller
to perform its obligations under this Agreement or the Certificate or (iii) the
collectibility of the Receivables. Neither the Seller nor any of its
Subsidiaries is in default with respect to any order of any court, arbitrator or
governmental body except for defaults with respect to orders of governmental
agencies which defaults are not material to the business or operations of the
Seller or any of its Subsidiaries or the Seller's ability to perform its
obligations hereunder.
(g) USE OF PROCEEDS. No proceeds of any Purchase will be used by the
Seller to acquire any security in any transaction which is subject to Section 13
or 14 of the Securities Exchange Act of 1934, as amended.
(h) PERFECTION OF INTEREST IN TRANSFERRED ASSETS. Prior to the Buyer's
Purchase and/or acquisition of each Transferred Asset hereunder, the Seller is
or will be the lawful owner of, and have good title to, such Transferred Asset
free and clear of any Adverse Claim and upon each Purchase and/or acquisition by
the Buyer of Transferred Assets hereunder, the Buyer shall acquire a valid and
perfected first priority ownership interest in each Receivable then existing or
thereafter arising and in the Related Security, the other Transferred Assets and
Collections and with respect thereto, in each case free and clear of any Adverse
Claim. All such Purchases of Receivables and related Transferred Assets
constitute true and valid sales, and all such Purchases and contributions of
Receivables and related Transferred Assets constitute true and valid transfers
and assignments of all of Seller's right, title and interest in, to and under
such Transferred Assets (and not merely a pledge of such Receivables and related
Transferred Assets for security purposes), enforceable against creditors of the
Seller and no such Transferred Assets shall constitute property of the Seller;
and no effective financing statement or other instrument similar in effect
covering any Receivable, the Related Security, Collections or the other
Transferred Assets shall at any time be on file in any recording office except
such as may be filed in favor of the Buyer (or its assignees) in accordance with
this Agreement.
(i) ACCURACY OF INFORMATION. No Settlement Report (if prepared by the
Seller, or to the extent that information contained therein is supplied by the
Seller), information, exhibit, financial statement, document, book, record or
report (other than forecasts required to be delivered by the Seller hereunder)
furnished or to be furnished by the Seller to the Buyer in connection with this
Agreement is or shall be inaccurate in any material respect as of the date it is
or shall be dated or (except as otherwise disclosed to the Buyer, as the case
may be, at such time) as of the date so furnished, or contains or shall contain
any material misstatement of fact or omits or shall omit to state a material
fact or any fact necessary to make the statements contained therein not
materially misleading.
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(j) LOCATION OF CHIEF EXECUTIVE OFFICE AND RECORDS. The chief place of
business and chief executive office of the Seller are located at the address of
the Seller referred to in SECTION 9.02 hereof and the locations of the offices
where the Seller keeps all the Records are listed on EXHIBIT F (or at such other
locations, notified to the Buyer in accordance with SECTION 5.01(f), in
jurisdictions where all action required by SECTION 6.03 has been taken and
completed).
(k) LOCK-BOX ACCOUNTS. Each Obligor under a Contract has, within one
month of the date of Purchase of such Contract, been instructed to remit payment
on the Receivables to a Post Office Box for remittance to a Lock-Box Account or
directly to a Lock-Box Account substantially in the form of EXHIBIT G. From and
after the Closing Date, the Seller will have no right, title and/or interest to
any of the Lock-Box Accounts and will maintain no lock-box accounts in its own
name for the collection of such Receivables. The Seller has delivered to the
Collateral Agent a duplicate key to each Post Office Box and has filed a
standing delivery order with the United States Postal Service authorizing the
Collateral Agent to receive mail delivered to each such Post Office Box. The
account numbers of all Lock-Box Accounts, together with the names and addresses
of all the Lock-Box Banks maintaining such Lock-Box Accounts and the related
Post Office Boxes, are specified in EXHIBIT H.
(l) NO TRADE NAMES. Except as described in EXHIBIT I, the Seller has
no trade names, fictitious names, assumed names or "doing business as" names.
(m) SEPARATE CORPORATE EXISTENCE. The Seller is entering into the
transactions contemplated by this Agreement in reliance on the Buyer's identity
as a separate legal entity from the Seller and each of its Affiliates other than
the Buyer, and acknowledges that the Buyer and the other parties to the Facility
Documents are similarly entering into the transactions contemplated by the other
Facility Documents in reliance on the Buyer's identity as a separate legal
entity from the Seller and each such other Affiliate.
(n) TAXES. The Seller has filed or caused to be filed all Federal,
state and local tax returns which are required to be filed by it, and has paid
or caused to be paid all taxes shown to be due and payable on such returns or on
any assessments received by it, other than any taxes or assessments, the
validity of which are being contested in good faith by appropriate proceedings
and with respect to which the Seller has set aside adequate reserves on its
books in accordance with GAAP and which have not given rise to any Adverse
Claims.
(o) SOLVENCY. The Seller (i) is not "insolvent" (as such term is
defined in ss.101(32)(A) of the Bankruptcy Code, (ii) is able to pay its debts
as they mature; and (iii) does not have unreasonably small capital for the
business in which it is engaged or for any business or transaction in which it
is about to engage.
(p) NO FRAUDULENT CONVEYANCE. The transactions contemplated by this
Agreement and by each of the Facility Documents are being consummated by the
Seller in furtherance of the Seller's ordinary business, with no contemplation
of insolvency and with no intent to hinder, delay or defraud any of its present
or future creditors. By its receipt of the
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Purchase Prices hereunder and its ownership of the capital stock of the Buyer,
the Seller shall have received reasonably equivalent value for the Transferred
Assets sold or otherwise conveyed to the Buyer under this Agreement.
(q) SOFTWARE. Attached as EXHIBIT J is a list of all computer software
used by the Seller to administer the Receivables and other Transferred Assets.
Each of the Buyer and the Collateral Agent, as assignee of the Buyer, has (or
will have, concurrently with the effectiveness hereof) an enforceable right
(whether by license, sublicense or assignment) to use all of the computer
software used to account for the Transferred Assets to the extent necessary to
administer the Receivables and other Transferred Assets, such use to be subject
to the terms and conditions of any license agreement for such software between
the Seller and any third parties where applicable.
(r) REPRESENTATIONS WITH RESPECT TO RECEIVABLES AND CONTRACTS. With
respect to each Receivable:
(i) Each such Receivable, at the time of Purchase thereof, is an
Eligible Receivable. Each Contract relating to a Receivable: (a)
if it constitutes a Lease, is in substantially the form of
EXHIBIT K-1 hereto; (b) if it constitutes a Finance Agreement, is
in substantially the form of EXHIBIT K-2 hereto; (c) if it
constitutes a Leasehold Improvement Note, is in substantially the
form of EXHIBIT K-3 hereto; (d) if it constitutes a Practice
Finance Loan, is in substantially the form of EXHIBIT K-4 hereto,
and (e) if it constitutes a Non-Medical Contract, is in
substantially the form of EXHIBIT K-1, EXHIBIT K-2, EXHIBIT K-3
or EXHIBIT K-4 hereto.
(ii) There are no facts or circumstances existing as of the
Purchase Date thereof which give rise to any right of rescission,
offset, counterclaim or defense, including the defense of usury,
to the obligations of any Obligor, including the obligation of
such Obligor to pay all amounts due thereunder, with respect to
any Contract to which such Obligor is a party; and neither the
operation of any of the terms of any Contract nor the exercise of
any right thereunder will render such Contract unenforceable in
whole or in part or subject to any right of rescission, offset,
counterclaim or defense, including the defense of usury (other
than limitations on enforcement which may subsequently arise as a
result of bankruptcy, insolvency, reorganization or similar laws
relating to or affecting the enforcement of creditors, rights
generally and by general equitable principles), and no such right
of rescission, offset, counterclaim or defense has been asserted
with respect thereto.
(iii) As of the Cut-Off Date, (i) the aggregate Discounted
Receivables Balance of Contracts that are Leases is $5,239,644,
(ii) the aggregate Discounted Receivables Balance of Contracts
that are Finance Agreements
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pursuant to which the Buyer finances an Obligor's purchase of
Equipment is $2,963,452, (iii) the aggregate Discounted
Receivables Balance of Contracts that are Leasehold Improvement
Notes is $1,439,116 and (iv) the aggregate discounted book value
of anticipated residuals on the Equipment subject to Leases is,
net of security deposits, $290,283.
(iv) Each Lease requires the Obligor to assume all risk of loss
or malfunction of the related Equipment. Each Lease and Finance
Agreement pursuant to which the Buyer finances an Obligor's
purchase of Equipment requires the Obligor to pay all sales, use,
property, excise and other similar taxes imposed on or with
respect to the related Equipment and permits the rights with
respect to such Contract, and all collateral related thereto, to
be assigned by the Seller without the consent of any Person. No
Contract permits early termination or prepayment, unless the
amount required to be paid by or on behalf of Obligor in respect
thereof is equal to or greater than the applicable Termination
Amount. No Contract provides for the substitution, exchange or
addition of any Equipment subject thereto which would result in
any reduction of the amount of payments or change the timing of
payments due under such Contract.
(v) Each Lease requires the related Obligor to maintain the
related Equipment, if any, in good and workable order. Each Lease
and Finance Agreement pursuant to which the Buyer finances an
Obligor's purchase of Equipment requires the related Obligor to
obtain and maintain physical damage insurance on the Equipment
subject thereto and to name the lessor or lender thereunder as
loss payee and an additional insured with respect thereto. The
Collateral Agent is named as loss payee under all physical damage
insurance on the Equipment that is carried by the Seller or the
Buyer. To the best of Seller's knowledge, the Equipment was
properly delivered to the Obligor in good repair, without defects
and in satisfactory order and the related Equipment, if any, is
in good operating condition and repair. To the best of the
Seller's knowledge, the related Equipment was accepted by the
Obligor after reasonable opportunity to inspect and test the same
and no Obligor has informed the Seller of any defects therein.
(vi) On each Purchase Date, after giving effect to the Purchases
to be made on such date, the aggregate Discounted Receivables
Balance of all Contracts with Obligors located in any one state
does not exceed 30% of the Discounted Receivables Balance for all
Contracts.
(vii) On the Cut-Off Date, the Weighted Average Remaining Term of
the Contracts included in the initial Purchase was 49 months. On
each subsequent Purchase Date, after giving effect to the
Purchases to be made
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on such date, the Weighted Average Remaining Term does not exceed
57 months.
(viii) On the Cut-Off Date, the lowest Outstanding Balance of the
Receivables under any Contract included in the Purchases to be
made on such date is no less than $224 and the highest
Outstanding Balance of the Receivables under any Contract
included in the Purchases to be made on such date is no greater
than $130,667. As of each Purchase Date, after giving effect to
the Purchases to be made on such date, the average Outstanding
Balance of the Receivables is no greater than $30,000.
(ix) As of the Purchase Date thereof, the Seller has delivered
the Contract File for the related Contract to the Buyer or to the
Custodian on the Buyer's behalf together with duly executed
instruments of transfer or assignment in blank for each Contract
constituting an instrument or chattel paper.
(x) As of the Purchase Date thereof, the average original terms
of the Contracts included in such Purchase does not exceed 4.75
years.
(xi) As of the Purchase Date thereof, the excess of (i) the
average implicit interest rates being charged to Obligors in
respect of the Receivables then being purchased OVER (ii) the
Discount Rate applicable to such Receivables, shall not be
greater than eight percent (8.0%).
(s) OTHER INDEBTEDNESS. The Seller is not in default under any
material indenture, loan or credit agreement with respect to any Indebtedness,
the effect of which is to cause, or which would, with the giving of notice of
the lapse of time or both, permit the holder or holders thereof to cause, such
Indebtedness to become due prior to its stated maturity.
(t) INVESTMENT COMPANY. The Seller is not an "investment company" or a
company controlled by an "investment company" within the meaning of the
Investment Company Act of 1940.
(u) ERISA. Neither the Seller nor any of its ERISA Affiliates
maintains, contributes to or has any obligation to contribute to any Plan which
could reasonably be expected to, individually or in the aggregate, materially
adversely affect the ability of the Seller to perform its obligations under this
Agreement or any other Facility Document to which it is a party or which could
expose the Buyer to any material liability under ERISA. No accumulated or waived
funding deficiency (as defined in Section 302(a)(2) of ERISA or Section 412(a)
of the Internal Revenue Code) exists with respect to any Benefit Plan, and the
Seller has not failed to satisfy the minimum funding requirements under ERISA or
the Internal Revenue Code with respect to any Benefit Plan. Neither the Seller
nor any of its ERISA Affiliates has incurred any liability to or on account of a
Benefit Plan or Multiemployer Plan pursuant to Section 515, 4062, 4063, 4064,
4201 or 4204 of ERISA or expects to incur any liability under any of the
foregoing sections on
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account of the termination of participation in or contributions to any such Plan
or Multiemployer Plan.
(v) SELECTION OF RECEIVABLES. Each Receivable has been randomly
selected from the Originator's portfolio of receivables in accordance with its
normal standards and procedures used for all of its standard securitization
transactions and no selection procedures adverse to Triple-A have been employed
in such selections.
(w) HISTORIC LOSS DATA. Attached hereto as a part of EXHIBIT D is a
summary of historical static loss data of the Originator suffered as a result of
charge-offs of the Originator's receivables, which summary is true and accurate
with respect to the periods described therein and does not omit any information
necessary to make such summary not misleading.
(x) NON-MEDICAL CONTRACTS. On each Purchase Date, after giving effect
to the Purchases to be made on such date, the aggregate Discounted Receivables
Balance of all Non-Medical Contracts does not exceed 10% of the Discounted
Receivables Balance for all Contracts.
ARTICLE V
GENERAL COVENANTS OF THE SELLER
SECTION 5.01. AFFIRMATIVE COVENANTS OF THE SELLER. From the Closing
Date until the later of the Termination Date or the Collection Date, the Seller
will, unless the Buyer shall otherwise consent in writing:
(a) COMPLIANCE WITH LAWS, ETC. Comply in all material respects with
all applicable laws, rules, regulations and orders with respect to it, its
business and properties and all Receivables and related Contracts.
(b) PRESERVATION OF CORPORATE EXISTENCE. Preserve and maintain its
corporate existence, rights, franchises and privileges in the jurisdiction of
its incorporation, and qualify and remain qualified in good standing as a
foreign corporation in each jurisdiction except where the failure to preserve
and maintain such existence, rights, franchises, privileges and qualifications
would not materially adversely affect (i) the interests hereunder of the Buyer,
(ii) the collectibility of any Receivable, (iii) the business, properties,
operations, prospects, profits or condition (financial or otherwise) condition
of the Seller or (iv) the ability of the Seller (individually or as Servicer) to
perform its obligations hereunder and under the other Facility Documents to
which it is a party.
(c) AUDITS. At any time and from time to time upon prior written
notice to the Seller and during regular business hours and on a quarterly basis
if requested, permit the Buyer and its designees (including the Collateral
Agent), or their respective agents or representatives, (i) to examine and make
copies of and abstracts from all Records, and (ii) to visit the offices and
properties of the Seller for the purpose of examining such Records, and to
discuss matters relating to the Receivables or the Seller's performance
hereunder with any of the officers or employees of the Seller having knowledge
of such matters. Each such audit shall be at the sole
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expense of the Seller; PROVIDED, however, that so long as no Event of
Termination has occurred in any calendar year, the annual costs of the audits
during such year for which the Seller is responsible shall not exceed $22,000.
(d) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Maintain and implement
administrative and operating procedures (including, without limitation, an
ability to recreate records evidencing the Receivables in the event of the
destruction of the originals thereof) and keep and maintain, all documents,
books, records and other information reasonably necessary or advisable for the
collection of all Receivables (including, without limitation, records adequate
to permit the daily identification of all Collections of and adjustments to each
Receivable).
(e) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS. At its
expense timely and fully perform and comply, in all material respects, with all
material provisions, covenants and other promises required to be observed by it
under the Contracts.
(f) LOCATION OF RECORDS. Keep its chief place of business and chief
executive office, and the offices where it keeps the Records, at the address(es)
of the Seller referred to in SECTION 4.01(j), or, in any such case, upon 30
days' prior written notice to the Buyer, at such other locations within the
United States where all action required by SECTION 2.08 and by SECTION 6.04
shall have been taken and completed.
(g) CREDIT AND COLLECTION POLICIES. Comply in all material respects
with its Credit and Collection Policy attached hereto as EXHIBIT D in regard to
each Receivable and the related Contract.
(h) COLLECTIONS. Instruct all Obligors to cause all Collections to be
deposited directly to a Post Office Box or Lock-Box Account and if the Seller
shall receive any Collections (including, without limitation, any Collections
deemed to have been received pursuant to SECTION 2.05), the Seller shall hold
such Collections in trust for the benefit of the Buyer and remit such
Collections to the Buyer by depositing such Collections into a Lock-Box Account
within one Business Day following Seller's identification thereof and in any
event within four Business Days following Seller's receipt thereof.
(i) COMPLIANCE WITH ERISA. Establish, maintain and operate all Plans
to comply in all material respects with the provisions of ERISA, the IRC, and
all other applicable laws, and the regulations and interpretations thereunder.
(j) PERFECTED SECURITY INTEREST UNDER CONTRACTS. Take such action with
respect to each Receivable as is necessary to ensure that the Buyer maintains,
as against the Obligor thereunder, a perfected security interest in any
Equipment relating thereto free and clear of Adverse Claims or, in the case of
any Lease, to ensure that the Buyer would maintain such a perfected priority
security interest in the event that a court or other Person were to determine
that such Lease purported to transfer to the Obligor an ownership (rather than a
leasehold) interest in the Equipment subject thereto; PROVIDED, that the Seller
shall not be required to file financing statements or to maintain the
effectiveness of previously filed financing statements with respect
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to any Receivables the Outstanding Balance of which originally is or has
thereafter been reduced below $5,000, respectively, so long as the aggregate
Outstanding Balance of Receivables for which no such financing statements are in
effect at any time remains less than 7.5% of the Discounted Receivables Balance
of all Receivables at such time; PROVIDED that such seven and one-half percent
limitation shall not apply from and after the Termination Date unless and to the
extent that the Buyer or the Collateral Agent on its behalf specifically
requests otherwise.
(k) MAINTENANCE OF INSURANCE. Maintain, or cause each Obligor to
maintain, with respect to the Contracts and the Equipment related thereto,
casualty and general liability insurance which provide at least the same
coverage as a fire and extended coverage insurance policy as is comparable for
other companies in related businesses. Such insurance policies (and
self-insurance where permitted) shall be maintained in an amount which is not
less than the Discounted Value for the Receivables arising under the relevant
Contracts. Each such casualty and liability policy if maintained by an Obligor,
shall name the Seller or the Buyer as loss payee and additional insured and the
Seller shall have assigned any such interest to the Buyer. The Seller shall
remit, or shall cause to be remitted, the proceeds of any such insurance policy
to a Lock-Box Account.
(l) SEPARATE IDENTITY. Take all actions required to maintain the
Buyer's status as a separate legal entity, including, without limitation, (i)
not holding the Buyer out to third parties as other than an entity with assets
and liabilities distinct from the Seller and the Seller's other Subsidiaries;
(ii) not holding itself out to be responsible for the debts of the Buyer or,
other than by reason of owning capital stock of the Buyer, for any decisions or
actions relating to the business and affairs of the Buyer; (iii) causing any
financial statements consolidated with those of the Buyer to address (by
footnote or otherwise and in language reasonably satisfactory to the Buyer and
the Collateral Agent) the separate corporate existence of the Buyer and the
Buyer's ownership of the Receivables; (iv) taking such other actions as are
necessary on its part to ensure that all corporate procedures required by its
and the Buyer's respective certificates of incorporation and by-laws are duly
and validly taken; (v) keeping correct and complete records and books of account
and corporate minutes; (vi) not acting in any other matter that could
foreseeably mislead others with respect to the Buyer's separate identity; and
(vii) taking such other actions as may be necessary on its part to ensure that
the Buyer is in compliance at all times with SECTION 5.01(l) of the Credit
Agreement and SECTION 5.01(l) of the Triple-A Purchase Agreement.
(m) TAXES. File or cause to be filed, and cause each of its
Subsidiaries with whom it shares consolidated tax liability to file, all
federal, state and local tax returns which are required to be filed by it,
except where the failure to file such returns could not reasonably be expected
to have a material adverse effect on the collectibility of the Transferred
Assets or the ability of the Seller to perform its obligations hereunder or
under any other Facility Document to which it is a party or which could
otherwise be reasonably expected to expose the Buyer to a material liability.
The Seller shall pay or cause to be paid all taxes shown to be due and payable
on such returns or on any assessments received by it, other than any taxes or
assessments, the validity of which are being contested in good faith by
appropriate proceedings and with respect
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to which the Seller or the applicable subsidiary shall have set aside adequate
reserves on its books in accordance with GAAP and which proceedings could not
reasonably be expected to have a material adverse effect on the collectibility
of the Transferred Assets or the ability of the Seller to perform its
obligations hereunder or under any other Facility Document to which it is a
party or which could otherwise be reasonably expected to expose the Buyer to a
material liability.
(n) SEGREGATION OF COLLECTIONS. Prevent the deposit into any of the
Lock-Box Accounts of any funds other than Collections in respect of the
Transferred Assets and, to the extent that any such funds are nevertheless
deposited into any of such Lock-Box Accounts, promptly identify any such funds
to the Servicer for segregation and remittance to the owner thereof.
SECTION 5.02. REPORTING REQUIREMENTS OF THE SELLER. From the Closing
Date until the later of the Termination Date or the Collection Date, the Seller
will, unless the Buyer shall otherwise consent in writing, furnish to the Buyer:
(a) as soon as available and in any event within 45 days after the end
of each of the first three quarters of each fiscal year of the Seller,
consolidated balance sheets of the Seller and its consolidated Subsidiaries as
of the end of such quarter, and consolidated statements of income and retained
earnings of the Seller and its consolidated Subsidiaries each for the period
commencing at the end of the previous fiscal year and ending with the end of
such quarter, certified by the chief financial officer, chief accounting officer
or treasurer of the Seller;
(b) as soon as available and in any event within 105 days after the
end of each fiscal year of the Seller, a copy of the consolidated balance sheets
of the Seller and its consolidated Subsidiaries as of the end of such year and
the related consolidated statements of income and retained earnings of the
Seller and its consolidated Subsidiaries for such year each reported on by
nationally recognized independent public accountants acceptable to the Buyer
(the Buyer acknowledges that any of the "Big 5" accounting firms will be
acceptable to the Buyer);
(c) promptly after the sending or filing thereof, copies of all
reports which the Seller sends to any of its security holders and copies of all
reports and registration statements which the Seller files with the Securities
and Exchange Commission or any national securities exchange other than
registration statements relating to employee benefit plans and to registrations
of securities for selling security holders;
(d) as soon as possible and in any event within five Business Days
after the occurrence of each Event of Termination or each event which, with the
giving of notice or lapse of time or both, would constitute an Event of
Termination, the statement of the chief financial officer, chief accounting
officer or treasurer of the Seller setting forth details of such Event of
Termination or event and the action which the Seller proposes to take with
respect thereto;
(e) promptly after the filing or receiving thereof, copies of all
reports and notices with respect to any Reportable Event defined in Article IV
of ERISA which the Seller or any
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Subsidiary of the Seller files under ERISA with the IRS or the PBGC or the DOL
or which the Seller or any Subsidiary of the Seller receives from the PBGC;
(f) promptly, from time to time, such other information, documents,
records or reports respecting the Receivables or the conditions or operations,
financial or otherwise, of the Seller or any Subsidiary of the Seller as the
Buyer may from time to time reasonably request in order to protect the interests
of the Buyer under or as contemplated by this Agreement; and
(g) as soon as possible and in any event with five Business Days after
the occurrence thereof, notification of: (i) any material changes in the
Seller's bank agreements, indentures or other material agreements governing
Indebtedness and/or (ii) any event which constitutes (or which, with the giving
of notice or the passage of time or both, would constitute) a default under any
such agreement or permits or (iii) any other event which permits (or which, with
the giving of notice or the passage of time, would permit) the holder of such
Indebtedness to accelerate the maturity thereof.
SECTION 5.03. NEGATIVE COVENANTS OF THE SELLER. From the Closing Date
until the later of the Termination Date or the Collection Date, the Seller will
not, without the written consent of the Buyer:
(a) SALES, LIENS, ETC. AGAINST RECEIVABLES AND TRANSFERRED ASSETS.
Except as otherwise provided herein, sell, assign (by operation of law or
otherwise) or otherwise dispose of, or create or suffer to exist, any Adverse
Claim upon or with respect to, any Receivable, Related Security or Collections,
or any related Contract, or upon or with respect to any Lock-Box Account to
which any Collections of any Receivable are sent, or assign any right to receive
income in respect thereof, or upon any other Transferred Asset, except that the
Seller shall have no responsibility for any Adverse Claim created by an Obligor
upon or with respect to any Equipment owned by such Obligor so long as such
Adverse Claim is subordinate to the security interest of the Seller in such
Equipment.
(b) EXTENSION OR AMENDMENT OF RECEIVABLES. Extend, amend or otherwise
modify, the terms of any Receivable, or amend, modify or waive, any term or
condition of any Contract related thereto, except to the extent that the Seller,
in its capacity as Servicer, may make such amendments in accordance with the
Credit and Collection Policy or as otherwise permitted under ARTICLE VI hereof.
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. Without the
prior written consent of the Collateral Agent, make any material change in the
character of its business or make any change in the Credit and Collection
Policy, which change would, in either case, impair the collectibility of any
Transferred Asset.
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS. (i) After giving the
payment instructions described in the first sentence of SECTION 4.01(k), make
any change in such instructions to Obligors regarding payments to be made to the
Buyer or payments to be made to any Lock-Box Bank or (ii) add or terminate any
bank as a Lock-Box Bank from those listed in
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EXHIBIT H unless the Buyer shall have received (A) ten Business Days' prior
notice of such addition, termination or change and (B) prior to the effective
date of such addition, termination or change, (x) executed copies of Lock-Box
Agreements executed by each new Lock-Box Bank and (y) copies of all agreements
and documents signed by the Seller or the respective Lock-Box Bank with respect
to any new Lock-Box Account.
(e) MERGER ETC. (i) Merge with or into or consolidate with or into or
convey, transfer, lease or otherwise dispose of (whether in one transaction or
in a series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) or acquire all or substantially all of the assets
or capital stock or other ownership interest of, any Person, or permit any
Subsidiary of Seller to do so, except that (A) any Subsidiary of Seller may
merge or consolidate with or transfer assets to or acquire assets from any other
Subsidiary of Seller, (B) any Subsidiary of Seller may merge into or transfer
assets to the Seller or any other Person and (C) the Seller or any Subsidiary of
the Seller may acquire the capital stock or assets of any other Person, provided
in each case that immediately after giving effect to such proposed transaction,
no Event of Termination or event which, with the giving of notice or lapse of
time, or both, would constitute an Event of Termination, would exist, and in the
case of any such merger to which the Seller is a party, the Seller is the
surviving corporation.
(f) CHANGE IN CORPORATE NAME. Make any change to its corporate name or
use any trade names, fictitious names, assumed names or "doing business as"
names other than those described in EXHIBIT I, unless the Seller has given to
the Buyer at least thirty (30) days' prior written notice thereof and, prior to
the effective date of any such name change or use, Seller delivers to the Buyer
such Financing Statements (Form UCC-1 and UCC-3) executed by Seller which the
Buyer may reasonably request to reflect such name change or use, together with
such other documents and instruments that the Buyer may request in connection
therewith.
(g) ERISA MATTERS. (i) Engage or permit any ERISA Affiliate to engage
in any prohibited transaction for which an exemption is not available or has not
previously been obtained from the DOL; (ii) permit to exist any accumulated
funding deficiency, as defined in Section 302(a) of ERISA and Section 412(a) of
the IRC, or funding deficiency with respect to any Benefit Plan other than a
Multiemployer Plan; (iii) fail to make any payments to any Multiemployer Plan
that the Seller or any ERISA Affiliate may be required to make under the
agreement relating to such Multiemployer Plan or any law pertaining thereto;
(iv) terminate any Benefit Plan so as to result in any liability; or (v) permit
to exist any occurrence of any reportable event described in Title IV of ERISA
which represents a material risk of a liability of the Seller or any ERISA
Affiliate under ERISA or the IRC; PROVIDED, HOWEVER, the Seller and its ERISA
Affiliates may take or allow such prohibited transactions, accumulated funding
deficiencies, payments, terminations and reportable events described in clauses
(i) through (iv) above so long as such events occurring within any fiscal year
of the Seller, in the aggregate, involve a payment of money by or an incurrence
of liability of the Seller or any ERISA Affiliate (collectively, "ERISA
Liabilities") in an amount which does not exceed $500,000.
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(h) TERMINATE OR REJECT CONTRACTS. Without limiting SECTION 5.03(b)
and except as otherwise expressly permitted pursuant to SECTION 2.05, terminate
or reject any Contract prior to the term of such Contract, whether such
rejection or early termination is made pursuant to an equitable cause, statute,
regulation, judicial proceeding or other applicable law (including, without
limitation, Section 365 of the Bankruptcy Code), unless prior to such
termination or rejection, the Seller shall have paid to the Buyer an amount
equal to the Termination Amount thereof.
(i) ACCOUNTING TREATMENT. Prepare any financial statements or other
statements which shall account for the transactions contemplated by this
Agreement in any manner other than as the sale of, or a capital contribution of,
the Transferred Assets by the Seller to the Buyer (it being understood that
non-recognition of such transaction due to the application of consolidated
financial reporting principles under GAAP or the filing of tax returns on a
consolidated basis shall not constitute a violation of this covenant).
(j) CERTIFICATE OF INCORPORATION. Cause the Buyer to amend its
Certificate of Incorporation or By-laws in any manner which would require the
consent of the Buyer's independent director or directors, without the Collateral
Agent's prior written consent.
SECTION 5.04. FINANCIAL COVENANTS OF THE SELLER. (a) From the Closing
Date until the later of the Termination Date or the Collection Date, the Seller
will not suffer or permit:
(i) CONSOLIDATED TANGIBLE NET WORTH. The Seller will not permit
"Consolidated Tangible Net Worth" (as defined below) as of the
end of any fiscal quarter to be less than the sum of (i)
$35,000,000 PLUS (ii) on a cumulative basis, 75% of positive
"Consolidated Net Income" (as defined below) for each fiscal
quarter beginning with the fiscal quarter commencing on or after
October 1, 1999 PLUS (iii) 100% of the proceeds of any sale by
the Seller or any of its Subsidiaries of (A) equity securities
issued by the Seller or any of its Subsidiaries, or (B) warrants
or subscription rights for equity securities issued by the Seller
or any of its Subsidiaries.
(ii) Indebtedness of the Seller and its Consolidated Subsidiaries
at the end of any fiscal quarter to exceed seven-hundred percent
(700%) of Consolidated Tangible Net Worth at the end of such
fiscal quarter. For purposes of this SECTION 5.04(a)(ii), the
following shall be considered liabilities when calculating
"Consolidated Tangible Net Worth" as used herein:
(A) any Indebtedness of the Seller and/or its Consolidated Subsidiaries
that (i) is unsecured and expressly subordinate to the repayment of the
obligations evidenced by the Facility Documents and (ii) matures after the
date that is less than five years from the date on which "Consolidated
Tangible Net Worth" is calculated hereunder, excluding, without
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limitation, the unsecured and expressly subordinate Indebtedness with an
aggregate principal amount equal to $20,000,000 in existence on March 31,
2000, and
(B) any preferred stock or other equity interests in the Seller and/or its
Consolidated Subsidiaries that are subject to acceleration or other
mandatory repayment conditions and that mature in fewer than five years
from the date on which "Consolidated Tangible Net Worth" is calculated as
required hereunder (the Indebtedness described in clause (A) and the
preferred stock or other equity interests described in clause (B), taken
together, the "Sub Debt");
PROVIDED, that, on any date of calculation, in the event the aggregate amount of
the Sub Debt exceeds an amount equal to 45% of the sum of (a) "Consolidated
Tangible Net Worth" PLUS (b) Sub Debt PLUS (c) any other Indebtedness, preferred
stock or equity interest that does not constitute Sub Debt, then the amount of
such excess shall constitute a liability for purposes of calculating
"Consolidated Tangible Net Worth" hereunder.
(iii) The ratio of (A) "Consolidated EBIT" (as defined below) to
(B) "Total Interest Expense" (as defined below), as of the end of
any fiscal quarter, to be less than (1) 1.15 to 1.0 for the four
fiscal quarter period then ending.
(iv) the Seller to have a credit line less than $50,000,000 under
the terms of at least one committed credit facility not insured
by MBIA Insurance Corporation where such facility is extended to
the Seller by a financial institution (with the understanding
that such financial institution may not offer such facility
through a commercial paper conduit) and the terms and conditions
of such facility are in form and substance similar to the terms
and conditions set forth in the Third Amended and Restated Credit
Agreement, dated as of March 16, 1998 (as the same may be
amended, restated, supplemented or otherwise modified from time
to time, the "1998 Credit Agreement") among HPSC, Inc., American
Commercial Finance Company, and BankBoston, N.A.
(b) As used in this SECTION 5.04, the following terms shall have the
following meanings:
"CONSOLIDATED EBIT" for any period means the consolidated earnings (or
loss) from the operations of the Seller and its Consolidated Subsidiaries
after all expenses and other proper charges but before payment or provision
for income taxes or interest expense for such period, as determined in
accordance with GAAP.
"CONSOLIDATED NET INCOME" for any period means the consolidated net
income (or deficit) of the Seller and its Consolidated Subsidiaries, after
deduction of all expenses,
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taxes and other proper charges, for such period as determined in accordance
with GAAP, after eliminating therefrom all extraordinary nonrecurring items
of income.
"CONSOLIDATED SUBSIDIARIES" means all of the Subsidiaries of the
Seller consolidated for financial reporting purposes in accordance with
GAAP, whether or not such Subsidiary should be so consolidated for
financial reporting purposes.
"CONSOLIDATED TANGIBLE NET WORTH" means the excess of (i) total assets
of the Seller and its Consolidated Subsidiaries as determined in accordance
with GAAP MINUS (ii) total liabilities of the Seller and its Consolidated
Subsidiaries as determined in accordance with GAAP and any Indebtedness of
the Seller and its Consolidated Subsidiaries (whether or not classified as
liabilities) MINUS (iii) the total book value of all assets of the Seller
and its Consolidated Subsidiaries properly classified as intangible assets
under generally accepted accounting principles, including such items as
good will, the purchase price of acquired assets in excess of the fair
market value thereof, trademarks, trade names, service marks, brand names,
copyrights, patents and licenses, and rights with respect to the foregoing
MINUS (iv) all amounts representing any write-up in the book value of any
assets of the Seller or its Consolidated Subsidiaries resulting from a
revaluation thereof subsequent to December 25, 1993, excluding adjustments
to translate foreign assets and liabilities for changes in foreign exchange
rates made in accordance with Financial Accounting Standards Board
Statement No. 52, MINUS (v) deferred underwriting expenses and deferred
origination costs.
"TOTAL INTEREST EXPENSE" means for any period the aggregate amount of
interest required to be paid or accrued by the Seller and its Consolidated
Subsidiaries during such period in respect of Indebtedness, whether such
interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of
capitalized leases and including commitment fees, agency fees, facility
fees, balance deficiency fees and similar fees or expenses in connection
with such Indebtedness.
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. DESIGNATION OF SERVICER. Consistent with the Buyer's
ownership of the Transferred Assets, the Buyer shall have as against the Seller
the sole right to service, administer and collect the Receivables, to assign
such right and to delegate such right. The servicing, administering and
collection of the Receivables and the other Transferred Assets shall be
conducted by the Person (the "SERVICER") so designated by the Buyer from time to
time in accordance with this SECTION 6.01. Until the Collateral Agent gives
notice to the Seller of the designation of a new Servicer, the Seller is hereby
designated as, and hereby agrees to perform the duties and obligations of, the
Servicer pursuant to the terms hereof. The Buyer may, at any time upon ten
Business Days prior written notice, designate as Servicer any Person to succeed
the Seller on the condition any such Person so designated shall agree to perform
the duties and obligations of the Servicer pursuant to the terms hereof and
shall be acceptable to the Collateral
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Agent; PROVIDED that the Buyer's right to so designate a successor Servicer at
any time is personal to the Buyer and may not be assigned to any other Person
(including the Collateral Agent). The Collateral Agent may at any time from and
after a Servicing Termination Event designate as Servicer any other Person to
succeed the Seller or any Successor Servicer, on the condition in each case that
any such Person so designated shall agree to perform the duties and obligations
of the Servicer pursuant to the terms hereof. The Servicer may, with the prior
written consent of the Buyer and the Collateral Agent, subcontract with any
other Person for servicing, administering or collecting the Transferred Assets,
provided that the Servicer shall remain liable for the performance of the duties
and obligations of the Servicer pursuant to the terms hereof. The Servicer shall
use reasonable care in performing its duties as Servicer hereunder and, without
limiting the foregoing, shall service the Transferred Assets in accordance with
the Credit and Collection Policy. The Servicer acknowledges that the Buyer has
(a) pursuant to the Credit Agreement, granted to the Collateral Agent, for the
benefit of Triple-A and the Surety, a security interest in Pledged Assets and
has assigned to the Collateral Agent all of its rights under this Agreement with
respect to such Pledged Assets, including its rights with respect to the
Servicer under this ARTICLE VI, as more fully described in SECTION 9.04
hereunder, and (b) pursuant to the Triple-A Purchase Agreement, sold to Triple-A
Purchased Assets which will be serviced pursuant to ARTICLE VI of the Triple-A
Purchase Agreement.
SECTION 6.02. DUTIES OF THE SERVICER. (a) The Servicer shall take or
cause to be taken all such actions as may be necessary or advisable to collect
each Transferred Asset 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. The Buyer hereby appoints as
its agent the Servicer, from time to time designated pursuant to Section 6.01,
to enforce its respective rights and interests in and under the Receivables, the
Related Security, the related Contracts and the other Transferred Assets. The
Servicer will at all times apply the same standards and follow the same
procedures with respect to the decision to commence, and in prosecuting and
litigating with respect to Receivables as it applies and follows with respect to
accounts, chattel paper and instruments which are not Transferred Assets. In no
event shall the Servicer be entitled to make the Collateral Agent or the Buyer a
party to any litigation without the Buyer's and the Collateral Agent's express
prior written consent. The Servicer shall segregate and set aside for the
account of the Buyer all Collections of Transferred Assets in accordance with
SECTION 2.05 hereof, SECTION 6.06 of the Credit Agreement and SECTION 6.06 of
the Triple-A Purchase Agreement and shall cause all such Collections to be
remitted to a Lock-Box Account and/or deposited directly into the Collection
Account within one Business Day after identification thereof by the Servicer and
in any event within four Business Days after the Servicer's receipt thereof. The
Servicer shall promptly review all checks and other instruments returned to it
by the Lock-Box Bank on account of restrictive endorsements, improper payees,
incorrect amounts or for any other reason and shall not deposit any such checks
or instruments in its own accounts unless it is determined to the Buyer's
satisfaction that such amounts do not constitute Collections; any such checks or
instruments which are determined to be Collections shall be promptly remitted to
the Lock-Box Account or the Collection Account as provided above. Provided that
the Termination Date shall not have occurred, the Seller, while it is Servicer,
may, in accordance with the Credit and Collection Policy, (i) amend, modify or
waive
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any term or condition of any Contract to reflect any Permitted Extension, (ii)
adjust the Outstanding Balance of any Transferred Asset to reflect the
reductions, adjustments or cancellations described in the first sentence of
SECTION 2.05 of the Purchase Agreement, (iii) so long as such prepayment would
not cause an Event of Termination under SECTION 7.01(m) hereof and subject to
the payment of the Termination Amount, consent to the prepayment or early
termination of a Contract, and (iv) amend, modify or waive any provision of a
Delinquent Receivable or Defaulted Receivable so as to maximize the
collectibility thereof. The Seller shall deliver to the Servicer, and the
Servicer shall hold in trust for the Seller and the Buyer in accordance with
their respective interests, all Records. Notwithstanding anything to the
contrary contained herein, following the occurrence of an Event of Termination,
the Collateral Agent shall have the absolute and unlimited right to direct the
Servicer (whether the Servicer is the Seller or otherwise) to commence or settle
any legal action to enforce collection of any Receivable or other Transferred
Asset or to foreclose upon or repossess any Related Security.
(b) The Servicer shall as soon as practicable following receipt turn
over to the Seller the collections of any receivable which is not a Transferred
Asset less, in the event the Seller is not the Servicer, all reasonable and
appropriate out-of-pocket costs and expenses of such Servicer of servicing,
collecting and administering such receivable.
(c) Notwithstanding anything to the contrary contained in this
Agreement, the Servicer, if the Collateral Agent or its designee, shall have no
obligation to collect, enforce or take any other action described in this
ARTICLE VI with respect to any receivable that is not a Transferred Asset other
than to deliver to the Seller the Collections and documents with respect to any
such receivable as described in the first two sentences of SECTION 6.02(b) and
to exercise the same degree of care with respect to Collections and documents in
its possession as it would exercise with respect to its own property.
(d) The Servicer will, at the Servicer's cost and expense and as agent
in the name of and on behalf of the Buyer, but subject at any time to the right
of the Buyer to direct and control, endeavor to collect, as and when the same
becomes due, all amounts owing on each Receivable. In the event of default by an
Obligor under any Receivable, the Servicer shall have the power and authority,
on behalf of the Buyer, to take such action in respect of the enforcement and
collection of such Receivable as the Servicer, in the absence of contrary
instructions from the Buyer, may deem advisable. In any such suit for
enforcement or collection, the Servicer shall be entitled to xxx thereon in its
own name or as agent for the Buyer, in either case, for the account of the
Buyer.
(e) In the event the Servicer accepts in payment of any Receivable the
taking of repossession of the Equipment the sale or lease of which gave rise to
such Receivable, the Servicer agrees to use its reasonable efforts to resell or
re-lease such Equipment for the account of the Buyer and shall remit to the
Buyer the gross sale proceeds thereof or, to the extent such Equipment is
re-leased, shall deliver to the Buyer the chattel paper or other documents
evidencing the rights to payment arising from such re-lease, all of which
documents shall constitute Contracts and which rights to payment shall
constitute Receivables, and all of which
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Contracts and Receivables shall constitute part of the Transferred Assets.
Neither the Buyer nor the Collateral Agent shall have any obligation to take any
action or commence any proceedings to realize upon any Receivable or to enforce
any of its rights or remedies with respect thereto. Any moneys collected by the
Servicer pursuant to this SUBSECTION 6.02(e) shall be segregated by the
Servicer, held in trust by the Servicer for the Buyer and shall be remitted to a
Lock-Box Account or to the Collection Account within one Business Day after
identification thereof by the Servicer and in any event within four Business
Days after the Servicer's receipt thereof.
(f) The Servicer shall maintain all books of account and other records
pertaining to the Receivables and the other Transferred Assets in such form as
will enable the Buyer or its designees to determine at any time the status
thereof. The Servicer will permit the Buyer, the Collateral Agent and any Person
designated by the Buyer or the Collateral Agent, during regular business hours,
to inspect, audit, check and make abstracts from all books, accounts, records,
or other papers pertaining to such Transferred Assets. From time to time, at the
request of the Buyer or the Collateral Agent, the Servicer, at its own expense,
will (i) deliver to the Buyer and the Collateral Agent and any Person designated
by the Buyer or the Collateral Agent any records and invoices pertaining to the
Transferred Assets and evidence thereof as the Buyer, the Collateral Agent or
such designee may deem necessary to enable it to enforce its rights thereunder
and (ii) xxxx each computer record relating to, and each invoice or other
evidence of, the Transferred Assets (whether or not such computer record or
other item is the property of the Buyer) as the Buyer or Collateral Agent may
direct to reflect the interests of the Buyer and the Collateral Agent in such
Transferred Assets. The Servicer will either (i) segregate, from all the
documents relating to other receivables then owned or being serviced by the
Servicer, all documents relating to the Transferred Assets or (ii) xxxx all such
documents relating to the Transferred Assets so as to make such documents
readily identifiable as property of the Buyer and with such legend as shall be
specified by the Collateral Agent, and will, in either such event, hold all such
documents in trust for the Buyer and safely keep such documents in filing
cabinets or other suitable containers marked to show the Buyer's interest.
SECTION 6.03. Rights of the Buyer. At any time:
(a) The Buyer may notify the Obligors of the Receivables, or any of
them, of the Buyer's ownership interest in Transferred Assets and direct such
Obligors, or any of them, that payment of all amounts payable under any
Receivable be made directly to the Buyer or its designee (including, without
limitation, the Collateral Agent).
(b) The Seller shall, at the Collateral Agent's or Buyer's request and
at the Seller's expense, give notice of the Buyer's interest in the Transferred
Assets to each Obligor (in substantially the form of the Notice of Assignment)
and direct that payments be made directly to the Buyer or its designee
(including, without limitation, the Collateral Agent).
(c) The Seller shall, at the Buyer's request, assemble all Records
which the Buyer reasonably believes are necessary or appropriate for the
administration and enforcement of the
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Transferred Assets, and shall make the same available to the Buyer at a place
selected by the Buyer or its designee.
(d) The Seller hereby authorizes the Buyer and the Collateral Agent to
take any and all steps in the Seller's name and on behalf of the Seller
necessary or desirable, in the determination of the Buyer and/or the Collateral
Agent, to collect all amounts due under any and all Transferred Assets or
related Receivables, including, without limitation, endorsing the Seller's name
on checks and other instruments representing Collections and enforcing such
Receivables and the related Contracts.
SECTION 6.04. FURTHER ACTION EVIDENCING TRANSFERS. The Seller agrees
that from time to time, at its expense, it will promptly execute and deliver all
further instruments and documents, and take all further action that the Buyer
may reasonably request in order to perfect, protect or more fully evidence the
Buyer's interest in the Transferred Assets, or to enable the Buyer to exercise
or enforce any of its rights hereunder or under any related document. Without
limiting the generality of the foregoing, the Seller will xxxx its master data
processing records evidencing such Transferred Assets with a legend, acceptable
to the Buyer, evidencing that the Buyer has acquired an ownership interest
therein as provided in this Agreement and, upon the request of the Buyer, will
execute and file such financing or continuation statements, or amendments
thereto or assignments thereof, and such other instruments or notices, as may be
necessary or appropriate or as the Buyer may reasonably request. The Seller
hereby authorizes the Buyer to file one or more financing or continuation
statements, and amendments thereto and assignments thereof, relative to all or
any of the Transferred Assets now existing or hereafter arising without the
signature of the Seller where permitted by law. A carbon, photographic or other
reproduction of this Agreement or any financing statement covering the
Transferred Assets, or any part thereof, shall be sufficient as a financing
statement. If the Seller fails to perform any of its agreements or obligations
under this Agreement, the Buyer may (but shall not be required to) itself
perform, or cause performance of, such agreement or obligation, and the expenses
of the Buyer incurred in connection therewith shall be payable by the Seller
upon the Buyer's demand therefor; PROVIDED, HOWEVER, prior to taking any such
action, the Buyer shall give notice of such intention to the Seller and provide
the Seller with a reasonable opportunity to take such action itself.
SECTION 6.05. RESPONSIBILITIES OF THE SELLER. Anything herein to the
contrary notwithstanding, the Seller shall (i) perform all of its obligations
under the Contracts to the same extent as if such Contracts had not been
transferred to the Buyer under the Purchase Agreement and the exercise by the
Buyer or its assigns of their respective rights hereunder shall not relieve
Seller from such obligations and (ii) pay when due any taxes, including without
limitation, sales, excise and personal property taxes payable in connection with
the Transferred Assets, unless the Seller is contesting the payment of such
taxes in good faith and by appropriate proceedings and with respect to which no
Adverse Claim has been asserted or filed.
SECTION 6.06. ADMINISTRATION OF COLLECTIONS BY SERVICER. (a) The
Servicer shall identify on a timely basis all collections which are on account
of the Transferred Assets.
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including all deposits to Lock Box Accounts. On each Business Day, all
Collections received in the Lock Box Accounts for the prior Business Day (and
such Business Day, if practicable) shall be transferred to the Collection
Account. If the Servicer receives any cash or checks, drafts, wire transfers or
other instruments for the payment of money on account or otherwise in respect of
the Transferred Assets, the Servicer shall segregate such cash and other items,
hold such cash and other items in trust for the benefit of the Buyer and the
Collateral Agent and shall cause such cash and other items (properly endorsed,
where required, so that such items may be collected by the Buyer) to be
deposited in a Lock Box Account or directly in the Collection Account
immediately after the date any such cash or other item shall have been
identified as being on account of a Transferred Asset.
SECTION 6.07. APPLICATION OF COLLECTIONS. All Collections on account
of the Receivables of each Obligor shall be applied in the order of maturity
thereof unless specifically identified otherwise in writing by such Obligor or
directed by a court of competent jurisdiction. Any payment by an Obligor in
respect of any indebtedness or other obligations owed by such Obligor to the
Seller or the Servicer shall, except as otherwise specified by such Obligor or
otherwise required by law, be applied as a Collection of a Receivable of such
Obligor (in the order of the age by invoice date of such Receivables, starting
with the oldest such Receivable) to the extent of any amounts then due and
payable thereunder before being applied to any other indebtedness of such
Obligor to the Seller or the Servicer. The Servicer shall not influence or
instruct any Obligor who is indebted to the Seller in respect of any
indebtedness not included in the Transferred Assets to direct that its
remittances be applied to any such indebtedness prior to being applied to the
Transferred Assets.
SECTION 6.08. SERVICING FEE. On each Settlement Date, as full
compensation for its servicing activities hereunder, the Servicer shall be
entitled to receive a fee (the "SERVICING FEE") in an amount equal to 1.0% TIMES
the Outstanding Balance of the Receivables as of the last day of the prior
calendar month TIMES a fraction, the numerator of which is the number of actual
days elapsed in such calendar month and the denominator of which equals 360.
Notwithstanding the foregoing, to the extent that Advances under the Liquidity
Agreement are used to fund or maintain Borrowings or Purchases, then the
Servicing Fee shall be .75% TIMES the Outstanding Balance of the Receivables as
of the last day of the prior calendar month TIMES a fraction, the numerator of
which is the number of actual days elapsed in such calendar month and the
denominator of which equals 360. In the event that the Buyer (or the Collateral
Agent) appoints a successor Servicer, the Servicing Fee may be adjusted as
required by such successor Servicer and as agreed to by the Buyer and the
Collateral Agent.
SECTION 6.09. RESIGNATION; SUCCESSOR SERVICER. (a) The obligation of
the Servicer to service the Receivables is personal to the Servicer and the
parties recognize that another Person may not be qualified to perform such
obligations. Accordingly, the Servicer's obligation to service the Transferred
Assets hereunder shall be specifically enforceable and shall be absolute and
unconditional in all circumstances, including, without limitation, after the
occurrence and during the continuation of any Event of Termination or Servicing
Termination
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Event hereunder; PROVIDED, HOWEVER, that a Successor Servicer may be appointed
pursuant to this SECTION 6.09.
(b) Notwithstanding the foregoing, the Servicer may resign from the
obligations and duties hereby imposed on it as Servicer upon determination that
(i) the performance of its duties hereunder is no longer permissible under any
applicable law and (ii) there is no reasonable action which the Servicer could
take to make the performance of its duties hereunder permissible under any such
applicable law. Any determination permitting the resignation of the Servicer
shall be evidenced as to clause (i) above by an opinion of counsel to such
effect delivered to the Buyer and the Collateral Agent. Except to the extent
inconsistent with any such applicable law, no such resignation shall become
effective until a Successor Servicer shall have assumed the responsibilities and
obligations of the Servicer in accordance with the remaining provisions of this
SECTION 6.09.
(c) The Collateral Agent shall, as promptly as possible after the
Servicer has given notice pursuant to SECTION 6.09(b) above or at any time after
the Buyer's or the Collateral Agent's designation of a successor Servicer
pursuant to SECTION 6.01, appoint a successor servicer (the "SUCCESSOR
SERVICER") and such Successor Servicer shall accept its appointment by a written
assumption in a form acceptable to the Collateral Agent. Upon its appointment,
the Successor Servicer shall be the successor in all respects to the Servicer
with respect to servicing functions under this Agreement and the Credit
Agreement shall be subject to all the responsibilities, duties and liabilities
relating thereto placed on the Servicer by the terms and provisions hereof and
thereof, and all references in this Agreement or any other Facility Documents to
the Servicer shall be deemed to refer to the Successor Servicer. The Servicer
agrees to cooperate with the Successor Servicer in effecting the transfer of its
responsibilities, duties, liabilities and rights hereunder, including, without
limitation, the execution and delivery of assignments of financing statements,
the transfer to the Successor Servicer of all cash amounts held by the Servicer
or thereafter received with respect to the Transferred Assets, the transfer of
electronic records relating to the Transferred Assets in such form as the
Successor Servicer may reasonably request and the transfer of all related
Records, correspondence and other documents relating to the Transferred Assets.
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01. EVENTS OF TERMINATION. If any of the following events
("Events of Termination") shall occur:
(a) (i) The Servicer (if the Seller or any Affiliate of the Seller)
shall fail to perform or observe any term, covenant or agreement hereunder
(other than as referred to in clause (ii) of this SECTION 7.01(a)) and such
failure shall remain unremedied for three Business Days after written notice
from the Buyer or (ii) either the Servicer (if the Seller or any Affiliate of
the Seller) or the Seller shall fail to make any payment or deposit to be made
by it hereunder when due and with respect to such payments which do not relate
to the remittance of Collections,
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such failure shall remain unremedied for three Business Days after written
notice from the Buyer; or
(b) The Seller shall fail to perform or observe any term, covenant or
agreement contained in ARTICLE VI and any such failure shall remain unremedied
for five Business Days after written notice from the Buyer; or
(c) Any representation or warranty made or deemed to be made by the
Seller (or any of its officers) under or in connection with this Agreement, any
Settlement Report or other information or report delivered pursuant hereto shall
prove to have been false or incorrect in any material respect when made;
PROVIDED, HOWEVER, that (i) to the extent any breach of any such representation
or warranty may be cured within ten Business Days, the Seller shall have ten
Business Days after learning of such breach to make such representation and
warranty true and correct and (ii) if any such false or incorrect representation
or warranty has given rise to a deemed collection as provided under SECTION
2.05, then, upon the Seller's payment of such deemed Collection at the time and
in the manner required under this Agreement, the breach of such representation
or warranty shall not give rise to an Event of Termination under this subsection
(c); or
(d) The Seller shall fail to perform or observe any other term,
covenant or agreement contained in this Agreement on its part to be performed or
observed and any such failure shall remain unremedied for ten Business Days
after written notice from the Buyer (it being understood that, if any such
failure gives rise to a deemed Collection as provided under SECTION 2.05, then
the payment of such deemed Collection at the time and in the manner required
under this Agreement shall be deemed a remedy of such failure); or
(e) The Seller shall fail to pay any principal of or premium or
interest on any Indebtedness when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise) and
such failure shall continue after the applicable grace period, if any, specified
in the agreement or instrument relating to such Indebtedness; or any other
default under any agreement or instrument relating to any such Indebtedness of
the Seller or any other event, shall occur and shall continue after the
applicable grace period, if any, specified in such agreement or instrument if
the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or any such Indebtedness
shall be declared to be due and payable or required to be prepaid (other than by
a regularly scheduled required prepayment) prior to the stated maturity thereof;
or
(f) Any Purchase or acquisition by the Buyer of Transferred Assets
shall for any reason, except to the extent permitted by the terms hereof, cease
to create a valid and perfected first priority interest in each Receivable, the
Related Security and the Equipment and Collections with respect thereto;
provided, HOWEVER, if any such failure results in a deemed Collection under
SECTION 2.05 hereof and the Seller satisfies in full its payment obligations
under such section, then such failure shall not give rise to an Event of
Termination under this subsection (f); or
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(g) (i) An Insolvency Event shall occur with respect to the Seller or
the Buyer or (ii) the Seller or the Buyer shall take any corporate action to
authorize the filing of any Insolvency Proceeding; or
(h) There shall have been any material adverse change in the financial
condition or operations of the Seller since December 31, 1999 (except as
disclosed in the Interim Financials described in SECTION 4.01(e)), or there
shall have occurred any event which materially adversely affects the
collectibility of the Receivables generally or there shall have occurred any
other event which materially adversely affects the ability of the Seller to
collect Receivables generally or the ability of the Seller to perform hereunder;
or
(i) The Seller shall fail to observe any covenant contained in SECTION
5.04; or
(j) As of the last day of any month, the "Default Ratio" for the
aggregate of Receivables subject to the terms of the Credit Agreement and
Receivables subject to the terms of the Triple-A Purchase Agreement shall be
greater than 3.5%; or
(k) As of the last day of any month, the "Delinquency Ratio" for the
aggregate of Receivables subject to the terms of the Credit Agreement and
Receivables subject to the terms of the Triple-A Purchase Agreement shall be
greater than 3.5%; or
Any "Wind-Down Event" shall occur under the Credit Agreement or any
"Wind-Down Event" shall occur under the Triple-A Purchase Agreement; or
then, and in any such event, the Buyer may by notice to the Seller declare the
Termination Date to have occurred, EXCEPT that, in the case of any event
described in clause (i) of subsection (g) above, the Termination Date shall be
deemed to have occurred automatically upon the occurrence of such event. Upon
any such declaration or automatic occurrence, the Buyer shall have, in addition
to all other rights and remedies under this Agreement or otherwise, all other
rights and remedies provided under the UCC of the applicable jurisdiction and
other applicable laws, which rights shall be cumulative.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.01. INDEMNITIES BY THE SELLER. (a) Without limiting any
other rights which the Buyer may have hereunder or under applicable law, the
Seller hereby agrees to indemnify the Buyer and its permitted successors and
assigns (including, without limitation, Triple-A, the Collateral Agent and the
Surety) and their respective officers, directors, agents and employees (each, an
"INDEMNIFIED PARTY"), from and against any and all damages, losses, claims,
liabilities and related costs and expenses, including reasonable attorneys' fees
and disbursements (all of the foregoing being collectively referred to as
"INDEMNIFIED AMOUNTS") awarded against or incurred by any Indemnified Party
relating to or resulting from any of the following (excluding, however, (i)
Indemnified Amounts to the extent resulting from gross negligence or willful
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misconduct on the part of an Indemnified Party or (ii) recourse (except with
respect to payment and performance obligations provided for in this Agreement)
for uncollectible Receivables):
(i) the transfer of any Receivable which was not, as of the date
of Purchase, an Eligible Receivable;
(ii) any representation or warranty made or deemed made by the
Seller (or any of its officers) under or in connection with this
Agreement, any Settlement Report or any other information or
report delivered by the Seller pursuant hereto, which shall have
been false or incorrect in any material respect when made or
deemed made or delivered;
(iii) the failure by the Seller (individually or as Servicer) to
comply with any term, provision or covenant contained in this
Agreement (other than any covenant contained in SECTION 5.04, a
breach of which shall constitute an Event of Termination but
shall not give rise to indemnification under this SECTION 8.01),
or any agreement executed in connection with this Agreement or
with any applicable law, rule or regulation with respect to any
Receivable, the related Contract, the Related Security or the
other Transferred Assets, or the nonconformity of any Receivable,
the related Contract, the Related Security or the other
Transferred Assets with any such applicable law, rule or
regulation;
(iv) the failure to vest and maintain vested in the Buyer or to
transfer to the Buyer an interest in the Transferred Assets, free
and clear of any Adverse Claim (including, without limitation,
free and clear of any Permitted Encumbrance except in favor of
the Buyer or its assignees) whether existing at the time of the
Purchase of such Receivable or at any time thereafter;
(v) the failure to file, or any delay in filing (other than
solely as a result of the action or inaction of the Buyer),
financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable
laws against the Seller with respect to any Contract or
Receivables which are, or are purported to be, Transferred
Assets, whether at the time of any Purchase or at any subsequent
time;
(vi) any dispute, claim, offset or defense (other than discharge
in bankruptcy of the Obligor) of the Obligor to the payment of
any Receivable (including, without limitation, a defense based on
such Receivable or the related Contract not being a legal, valid
and binding obligation of such Obligor enforceable against it in
accordance with its terms), or any other claim resulting from the
sale or lease of the Equipment and/or services related thereto or
the furnishing or failure to furnish such Equipment and/or
services;
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(vii) any failure of the Seller, as Servicer or otherwise, to
perform its duties or obligations in accordance with the
provisions of ARTICLE VI;
(viii) any products liability claim or personal injury or
property damage suit or other similar or related claim or action
of whatever sort arising out of or in connection with the
Equipment or any other goods, merchandise and/or services which
are the subject of any Receivable or Contract;
(ix) the failure to pay when due any taxes, including, without
limitation, sales, excise or personal property taxes payable in
connection with the Transferred Assets;
(x) the termination, rejection or non-assumption by the Seller of
any Contract prior to the original term of such Contract, whether
such rejection, early termination or non-assumption is made
pursuant to an equitable cause, statute, regulation, judicial
proceeding or other applicable laws (including, without
limitation, Section 365 of the Bankruptcy Code);
(xi) the failure of the Seller and the Obligors under the
Contracts to maintain casualty and liability insurance for the
Equipment related to the Receivables in an amount at least equal
to the Discounted Receivables Balance for all Receivables at such
time;
(xii) the failure of any Lock-Box Bank to remit any funds in the
Lock-Box Accounts as required hereunder; and
(xiii) the commingling of Collections of any Transferred Assets
with any other funds of the Seller.
Any amounts subject to the indemnification provisions of this SECTION 8.01 shall
be paid by the Seller to the applicable Indemnified Party within two Business
Days following the Indemnified Party's demand therefor.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. AMENDMENTS, ETC. No amendment to or waiver of any
provision of this Agreement nor consent to any departure by the Seller, shall in
any event be effective unless the same shall be in writing and signed by (i) the
Seller and the Buyer (with respect to an amendment) or (ii) the Buyer (with
respect to a waiver or consent by it) or the Seller (with respect to a waiver or
consent by it), as the case may be, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given. This Agreement contains a final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire agreement (together with
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the exhibits hereto) among the parties hereto with respect to the subject matter
hereof, superseding all prior oral or written understandings.
SECTION 9.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in writing
(including telex communication and communication by facsimile copy) and mailed,
telexed, transmitted or delivered, as to each party hereto, at its address set
forth under its name on the signature pages hereof or at such other address as
shall be designated by such party in a written notice to the other parties
hereto. All such notices and communications shall be effective, upon receipt, or
in the case of delivery by mail, five days after being deposited in the mails,
or, in the case of notice by telex, when telexed against receipt of answer back,
or in the case of notice by facsimile copy, when verbal communication of receipt
is obtained, in each case addressed as aforesaid, except that notices and
communications pursuant to Article II shall not be effective until received.
SECTION 9.03. NO WAIVER; REMEDIES. No failure on the part of the Buyer
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
SECTION 9.04. BINDING EFFECT; ASSIGNABILITY. This Agreement shall be
binding upon and inure to the benefit of the Seller, the Buyer and their
respective successors and permitted assigns (which successors of the Seller
shall include a trustee in bankruptcy). The Seller may not assign any of its
rights and obligations hereunder or any interest herein without the prior
written consent of the Buyer and the Collateral Agent. The Buyer may assign at
any time its rights and obligations hereunder and interests herein to any other
Person without the consent of the Seller. Without limiting the foregoing, the
Seller acknowledges that the Buyer shall (i) assign to the Collateral Agent, for
the benefit of Triple-A and the Surety, as collateral security for its
obligations under the Credit Agreement, all of its rights, remedies, powers and
privileges hereunder with respect to Pledged Assets pledged to the Collateral
Agent thereunder and (ii) sell to Triple-A all of its right, remedies, powers
and privileges hereunder with respect to Purchased Assets (as defined in the
Triple-A Purchase Agreement), and that Triple-A and/or the Collateral Agent may
further assign such rights, remedies, powers and privileges to the extent
permitted in the Credit Agreement and the Triple-A Purchase Agreement. The
Seller agrees that the Collateral Agent, as the assignee of the Buyer, or
Triple-A, as appropriate, shall, subject to the terms of the Credit Agreement
and the Triple-A Purchase Agreement, have the right to enforce this Agreement
and to exercise directly all of the Buyer's rights and remedies under this
Agreement (including, without limitation, the rights and remedies under SECTIONS
6.01, 6.02, 6.03, 6.04 and 8.01) and the Seller agrees to cooperate fully with
the Collateral Agent and/or Triple-A in the exercise of such rights and
remedies. Without limiting the foregoing, the Seller hereby acknowledges that
the Buyer and Triple-A have agreed pursuant to the Credit Agreement, the
Triple-A Purchase Agreement and certain related agreements that, subject to the
restrictions set forth therein, the Collateral Agent and certain parties
providing credit enhancements and/or liquidity for Triple-A in connection with
the Credit Agreement and the Triple-A Purchase
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Agreement shall be entitled to exercise the Buyer's rights under this Agreement.
The Seller hereby consents to the foregoing and agrees to cooperate with any
such Person electing to exercise the Buyer's rights under this Agreement. 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 such time, after the Termination Date, as the Collection Date shall occur;
PROVIDED, HOWEVER, that the rights and remedies with respect to any breach of
any representation and warranty made by the Seller pursuant to ARTICLE IV and
the indemnification and payment provisions of ARTICLE VIII and ARTICLE X shall
be continuing and shall survive any termination of this Agreement.
SECTION 9.05. GOVERNING LAW; WAIVER OF JURY TRIAL. THIS AGREEMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE INTERESTS
OF THE BUYER IN THE TRANSFERRED ASSETS OR REMEDIES HEREUNDER OR THEREUNDER, IN
RESPECT THEREOF, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE
OF NEW YORK. THE SELLER HEREBY AGREES TO THE JURISDICTION OF ANY FEDERAL COURT
LOCATED WITHIN THE STATE OF NEW YORK, AND WAIVES PERSONAL SERVICE OF ANY AND ALL
PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY
REGISTERED MAIL DIRECTED TO THE SELLER AT THE ADDRESS SET FORTH ON THE SIGNATURE
PAGE HEREOF AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED FIVE (5) DAYS
AFTER THE SAME SHALL HAVE BEEN DEPOSITED IN THE U.S. MAILS, POSTAGE PREPAID, OR,
AT THE BUYER'S OPTION, BY SERVICE UPON CT CORPORATION SYSTEM, 0000 XXXXXXXX, XXX
XXXX, XXX XXXX 00000, WHICH THE SELLER HEREBY IRREVOCABLY APPOINTS AS ITS AGENT
FOR THE PURPOSE OF ACCEPTING SERVICE OF PROCESS. THE SELLER HEREBY WAIVES ANY
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE BETWEEN THE SELLER AND THE BUYER ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP BETWEEN THEM IN
CONNECTION WITH THIS AGREEMENT. INSTEAD, ANY DISPUTE RESOLVED IN COURT WILL BE
RESOLVED IN A BENCH TRIAL WITHOUT A JURY. WITH RESPECT TO THE FOREGOING CONSENT
TO JURISDICTION, THE SELLER HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON
CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND
CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY THE COURT. NOTHING IN THIS SECTION 9.05 SHALL AFFECT THE RIGHT OF
THE BUYER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT
THE RIGHT OF THE BUYER TO BRING ANY ACTION OR PROCEEDING AGAINST THE SELLER OR
ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.
SECTION 9.06. COSTS, EXPENSES AND TAXES. (a) In addition to the rights
of indemnification under ARTICLE VIII hereof, the Seller agrees to pay on demand
all reasonable
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costs and expenses in connection with the preparation, execution, delivery and
administration (including periodic auditing and any requested amendments,
waivers or consents) of this Agreement and the other documents to be delivered
hereunder, including, without limitation, the reasonable fees and out-of-pocket
expenses of counsel for the Buyer (and the Collateral Agent) with respect
thereto and with respect to advising the Buyer (and the Collateral Agent) as to
its rights and remedies under this Agreement, and the other agreements executed
pursuant hereto and all costs and expenses, if any (including reasonable counsel
fees and expenses), in connection with the enforcement of this Agreement and the
other agreements and documents to be delivered hereunder.
(b) In addition, the Seller shall pay any and all stamp, sales, excise
and other taxes and fees payable or determined to be payable in connection with
the execution, delivery, filing and recording of this Agreement or the other
agreements and documents to be delivered hereunder, and agrees to indemnify the
Buyer and its assignees against any liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes and fees.
SECTION 9.07. EXECUTION IN COUNTERPARTS; SEVERABILITY. This Agreement
may be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
agreement. In case any provision in or obligation under this Agreement or the
Certificate shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
SECTION 9.08. REFERENCE TO AND EFFECT ON PRIOR PCA. Each of the
parties hereto ratifies the sales, conveyances, payments, representations,
warranties, covenants and indemnities made by such party in the Prior PCA and
agrees that such agreement is, as of the date hereof, in full force and effect.
From and after the effectiveness of the initial Receivables Purchase under this
Agreement in accordance with Section 3.01, (i) the terms and provisions of this
Agreement shall amend and supersede the terms and provisions of the Prior PCA in
its entirety, (ii) the continuing rights, remedies and obligations of the
parties with respect to any Receivables acquired under the Prior PCA shall be
governed by the terms and provisions of this Agreement to the same extent as if
such Receivables had been conveyed under this Agreement, and (iii) all
references in any other Facility Documents to the Prior PCA or Appendix A
thereto shall mean and be a reference to this Agreement and Appendix A hereto.
It is expressly understood and agreed that the execution and delivery of this
Agreement is not intended to be, and shall not be construed as, a novation of
the Prior PCA nor of any liens granted or indebtedness incurred thereunder.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.
SELLER/SERVICER: HPSC, INC.
By:________________________________
Name: Xxxx XxXxxxxx
Title: Vice President and
Chief Financial Officer
By:________________________________
Name: Xxxx Xxxxxxx, Xx.
Title: Chairman and Chief Executive
Officer
Address: Sixty Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000-0000
Attn: Vice President, Finance
BUYER: HPSC BRAVO FUNDING CORP.
By:________________________________
Name: Xxxx Xxxxxxx, Xx.
Title: President
Address: Sixty Xxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000-0000
Attn: President
Signature Page to Amended and Restated Purchase and Contribution Agreement
