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EXHIBIT 10(b)
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PURCHASE AND SALE AGREEMENT
Dated as of March 30, 2001
among
XXXXX EXHAUST LLC,
XXXXXXX RIDE CONTROL PRODUCTS, INC,
MAREMONT EXHAUST PRODUCTS, INC.,
and
PUROLATOR PRODUCTS NA, INC.,
as Originators,
and
ARVINMERITOR RECEIVABLES CORPORATION,
as Buyer
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TABLE OF CONTENTS
SECTION HEADING PAGE
SECTION 1. DEFINITIONS AND RELATED MATTERS.....................................................................1
Section 1.1. Defined Terms......................................................................1
Section 1.2. Other Interpretive Matters.........................................................1
SECTION 2. AGREEMENT TO CONTRIBUTE, PURCHASE AND SELL..........................................................2
Section 2.1. Purchase and Sale..................................................................2
Section 2.2. Timing of Contribution, Purchases..................................................2
Section 2.3. Purchase Price.....................................................................2
Section 2.4. No Recourse or Assumption of Obligations...........................................3
SECTION 3. ADMINISTRATION AND COLLECTION.......................................................................3
Section 3.1. Collection Agent...................................................................3
Section 3.2. Deemed Collections.................................................................3
Section 3.3. Application of Collections.........................................................4
Section 3.4. Responsibilities of Originator.....................................................4
SECTION 4. REPRESENTATIONS AND WARRANTIES......................................................................4
Section 4.1. Mutual Representations and Warranties..............................................4
Section 4.2. Additional Representations by Each Originator......................................5
SECTION 5. GENERAL COVENANTS...................................................................................6
Section 5.1. Covenants..........................................................................6
Section 5.2. Organizational Separateness.......................................................10
SECTION 6. TERMINATION OF PURCHASES...........................................................................10
Section 6.1. Voluntary Termination.............................................................10
Section 6.2. Automatic Termination.............................................................10
SECTION 7. INDEMNIFICATION....................................................................................10
Section 7.1. Originators' Indemnity............................................................10
Section 7.2. Indemnification Due to Failure to Consummate Purchase.............................11
Section 7.3. Other Costs.......................................................................
SECTION 8. MISCELLANEOUS ..................................................................................11
Section 8.1. Amendments, Waivers, etc..........................................................11
Section 8.2. Assignment of Receivables Purchase Agreement......................................12
Section 8.3. Binding Effect; Assignment.......................................................12
Section 8.4. Survival..........................................................................12
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Section 8.5. Costs, Expenses and Taxes.........................................................12
Section 8.6. Execution in Counterparts; Integration............................................13
Section 8.7. Governing Law; Submission to Jurisdiction.........................................13
Section 8.8. No Proceedings....................................................................13
Section 8.9. Loans by Buyer to Originators....................................................13
Section 8.10. Notice............................................................................13
Section 8.11. Entire Agreement..................................................................13
SIGNATURE.........................................................................................................1
Exhibit A Purchase Price
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THIS PURCHASE AND SALE AGREEMENT dated as of March 30, 2001 (this
"Agreement") is among XXXXX EXHAUST LLC, an Indiana limited liability company,
XXXXXXX RIDE CONTROL PRODUCTS, INC., a Delaware corporation, MAREMONT EXHAUST
PRODUCTS, INC. a Delaware corporation and PUROLATOR PRODUCTS NA, INC., a
Delaware corporation (each an "Originator" and collectively, the "Originators"),
and ARVINMERITOR RECEIVABLES CORPORATION, a Delaware corporation ("Buyer"). The
parties agree as follows:
SECTION 1. DEFINITIONS AND RELATED MATTERS.
Section 1.1. Defined Terms. In this Agreement, unless otherwise
specified or defined herein: (a) capitalized terms are used as defined in
Schedule I to the Receivables Sale Agreement dated as of the date hereof (as
amended or modified from time to time, the "Second Tier Agreement") among Buyer,
ArvinMeritor, Inc., as collection agent (the "Initial Collection Agent"),
Amsterdam Funding Corporation, the liquidity providers party thereto, and ABN
AMRO Bank N.V. as the Enhancer and the Agent, as such agreement may be amended
or modified from time to time; and (b) terms defined in Article 9 of the UCC and
not otherwise defined herein are used as defined in such Article 9 as in effect
on the date hereof.
In addition, the following terms will have the meanings specified
below:
"Available Funds" is defined in Section 2.3(b) hereof.
"Closing Date" means the date on which this Agreement and the Second
Tier Agreement become effective in accordance with their terms.
"Excluded Losses" is defined in Section 7.1 hereof.
"Initial Funding Date" means March 30, 2001.
"Settlement Date" means, with respect to any Settlement Period, the
twentieth day of the immediately succeeding calendar month (or, if such day is
not a Business Day, the next preceding Business Day).
"Settlement Period" means a calendar month (or, in the case of the
first Settlement Period, the period from the Initial Funding Date to the end of
the next succeeding calendar month following the calendar month in which the
Initial Funding Date occurs).
"Trigger Event" means that (x) the outstanding principal amount of the
Subordinated Note exceeds the value of Buyer's interest in the Receivables
(determined in accordance with GAAP), and (y) such condition has continued for
five Business Days.
Section 1.2. Other Interpretive Matters. In this Agreement, unless
otherwise specified: (a) references to any Section or Annex refer to such
Section of, or Annex to, this Agreement, and references in any Section or
definition to any subsection or clause refer to such subsection or clause of
such Section or definition; (b) "herein," "hereof," "hereto," "hereunder" and
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terms refer to this Agreement as a whole and not to any particular provision of
this Agreement; (c) "including" means including without limitation, and other
forms of the verb "to include" have correlative meanings; (d) the word "or" is
not exclusive; and (e) captions are solely for convenience of reference and
shall not affect the meaning of this Agreement.
SECTION 2. AGREEMENT TO CONTRIBUTE, PURCHASE AND SELL.
Section 2.1. Purchase and Sale. On the terms and subject to the
conditions set forth in this Agreement, each Originator hereby sells to Buyer,
and Buyer hereby purchases from each Originator, all of such Originator's right,
title and interest in, to and under the Receivables originated by such
Originator, all Related Security and all proceeds thereof (including all
Collections with respect thereto), in each case whether now existing or
hereafter arising or acquired.
Section 2.2. Timing of Contribution, Purchases. All of the remaining
Receivables and Related Security existing at the opening of the Originators'
business on the Initial Funding Date are hereby sold to Buyer as of the Initial
Funding Date. After the Initial Funding Date, each Receivable and Related
Security shall be deemed to have been sold to Buyer immediately (and without
further action by any Person) upon the creation of such Receivable. The proceeds
with respect to each Receivable (including all Collections with respect thereto)
shall be sold at the same time as such Receivable, whether such proceeds (or
Collections) exist at such time or arise or are acquired thereafter.
Section 2.3. Purchase Price. (a) The aggregate purchase price for the
Receivables originated by an Originator sold on the Initial Funding Date shall
be such amount as agreed upon prior to the Initial Funding Date between such
Originator and Buyer to be the fair market value of such Receivables on such
date, which shall equal the excess of the (i) estimated aggregate outstanding
balance of such Receivables over (ii) an amount agreed upon by Buyer and such
Originator representing the uncertainty of payment and cost of purchase of such
Receivables. The purchase price for Receivables subsequently sold during any
Settlement Period shall be calculated in accordance with the provisions set
forth in Exhibit A hereto.
(b) On the Initial Funding Date, Buyer shall pay each Originator the
purchase price for the Receivables originated by it sold on that date. On each
Business Day after the Initial Funding Date on which an Originator sells any
Receivables originated by it to Buyer pursuant to the terms of Section 2.1,
until the termination of the purchase and sale of Receivables under Section 6
hereof, Buyer shall pay to such Originator the purchase price of such
Receivables (i) by depositing into such account as such Originator shall specify
immediately available funds from monies then held by or on behalf of Buyer
solely to the extent that such monies do not constitute Collections that are
required to be identified or are deemed to be held by the Collection Agent
pursuant to the Second Tier Agreement for the benefit of, or required to be
distributed to, the Agent or the Purchasers pursuant to the Second Tier
Agreement or required to be paid to the Collection Agent as the Collection Agent
Fee, or otherwise necessary to pay current expenses of Buyer (in its reasonable
discretion) (such available monies, the "Available Funds") and provided that
such Originator has paid all amounts then due by such Originator hereunder or
(ii) by increasing the principal amount owed to such Originator under a
promissory note (as amended or
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modified from time to time, each a "Subordinated Note" and collectively the
"Subordinated Notes") executed and delivered by Buyer to the order of such
Originator as of the Initial Funding Date. The outstanding principal amount owed
to an Originator under the related Subordinated Note may be reduced from time to
time as provided in Section 3.2 hereof or by payments made by Buyer from
Available Funds, provided that such Originator has paid all amounts then due by
such Originator hereunder. Each Originator shall make all appropriate record
keeping entries with respect to amounts due to such Originator under the related
Subordinated Note to reflect payments by Buyer thereon and increases of the
principal amount thereof, and such Originator's books and records shall
constitute rebuttable presumptive evidence of the principal amount of and
accrued interest owed to such Originator under the related Subordinated Note.
Section 2.4. No Recourse or Assumption of Obligations. Except as
specifically provided in this Agreement, the contribution, purchase and sale of
Receivables under this Agreement shall be without recourse to the Originators.
Each Originator and Buyer intend the transactions hereunder to constitute true
sales of Receivables by such Originator to Buyer, providing Buyer with the full
risks and benefits of ownership of the Receivables originated by such Originator
(such that the Receivables would not be property of such Originator's estate in
the event of such Originator's bankruptcy). If, however, despite the intention
of the parties, the conveyances provided for in this Agreement are determined
not to be "true sales" of Receivables from the Originators to Buyer, then this
Agreement shall also be deemed to be a "security agreement" within the meaning
of Article 9 of the UCC and each Originator hereby grants to Buyer a "security
interest" within the meaning of Article 9 of the UCC in all of such Originator's
right, title and interest in and to the Receivables (including the proceeds
thereof) originated by it, now existing and thereafter created, to secure a loan
in an amount equal to the aggregate purchase prices therefor and each of such
Originator's other payment obligations under this Agreement.
Buyer shall not have any obligation or liability with respect to any
Receivable, nor shall Buyer have any obligation or liability to any Obligor or
other customer or client of an Originator (including any obligation to perform
any of the obligations of such Originator under any Receivable).
SECTION 3. ADMINISTRATION AND COLLECTION.
Section 3.1. Collection Agent. The Initial Collection Agent shall be
responsible for the servicing, administration and collection of the Receivables,
all on the terms set out in (and subject to any rights to terminate the Initial
Collection Agent as Collection Agent pursuant to) the Second Tier Agreement.
Pursuant to the terms of the Second Tier Agreement, the Initial Collection Agent
has the right to appoint an Affiliate of the Initial Collection Agent to perform
certain services set forth in Article III of the Second Tier Agreement. The
Initial Collection Agent has appointed each Originator as a sub-collection agent
with respect to the Receivables originated by it to perform certain duties as
more fully set forth in the Letter Agreement.
Section 3.2. Deemed Collections. If on any day the outstanding balance
of a Receivable is reduced or cancelled as a result of any defective or rejected
goods or services, any cash discount or adjustment (including any adjustment
resulting from the application of any special refund or other discounts or any
reconciliation), any setoff or credit (whether such claim or credit
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arises out of the same, a related, or an unrelated transaction) or other reason
not arising from the financial inability of the Obligor to pay undisputed
indebtedness, (i) the applicable Originator shall be deemed to have received on
such day a Collection on such Receivable in the amount of such reduction or
cancellation and (ii) such Receivable shall thereupon be, or be deemed to be
reconveyed to an Originator. If on any day any representation, warranty,
covenant or other agreement of an Originator related to a Receivable is not true
or is not satisfied, (i) such Originator shall be deemed to have received on
such day a Collection in the amount of the outstanding balance of such
Receivable and (ii) such Receivable shall thereupon be, or be deemed to be
reconveyed to such Originator. Not later than the first Settlement Date after an
Originator is deemed pursuant to this Section 3.2 to have received any
Collections, such Originator shall transfer to Buyer, in immediately available
funds, the amount of such deemed Collections; provided, however, that if no such
application is required under the Second Tier Agreement, Buyer and such
Originator may agree to reduce the outstanding principal amount of the
Subordinated Note in lieu of all or part of such transfer. To the extent that
Buyer subsequently collects any payment with respect to any such "receivable,"
Buyer shall pay the applicable Originator an amount equal to the amount so
collected, such amount to be payable not later than the first Settlement Date
after Buyer has so collected such amount.
Section 3.3. Application of Collections. Any payment by an Obligor in
respect of any indebtedness owed by it to the related Originator shall, except
as otherwise specified by such Obligor (including by reference to a particular
invoice), or required by the related contracts or law, be applied, first, as a
Collection of any Receivable or Receivables then outstanding of such Obligor in
the order of the age of such Receivables, starting with the oldest of such
Receivables, and, second, to any other indebtedness of such Obligor to such
Originator.
Section 3.4. Responsibilities of Originator. Each Originator shall pay
when due all Taxes payable in connection with the Receivables originated by it
or their creation or satisfaction. Each Originator shall perform all of its
obligations under agreements related to the Receivables originated by it to the
same extent as if interests in such Receivables had not been transferred
hereunder. The Agent's or any Purchaser's exercise of any rights hereunder or
under the Second Tier Agreement shall not relieve any Originator from such
obligations. Neither the Agent nor any Purchaser shall have any obligation to
perform any obligation of any Originator in connection with the Receivables.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
Section 4.1. Mutual Representations and Warranties. Each of the
Originators and Buyer represents and warrants to the others as follows:
(a) Existence and Power. It is a corporation or limited
liability company, as applicable, duly organized, validly existing and
in good standing under the laws of its state of organization and has
all company power and authority and all governmental licenses,
authorizations, consents and approvals required to carry on its
business in each jurisdiction in which its business is now conducted,
except where failure to obtain such license, authorization, consent or
approval would not have a material adverse effect on (i) its ability to
perform its obligations under, or the enforceability of, any
Transaction
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Document to which it is a party, (ii) its business or financial
condition, (iii) the interests of Buyer or its assigns under the
Transaction Documents or (iv) the enforceability or collectibility of a
material portion of the Receivables.
(b) Authorization and No Contravention. Its execution,
delivery and performance of each Transaction Document to which it is a
party (i) are within its powers, (ii) have been duly authorized by all
necessary company action, (iii) do not contravene or constitute a
default under: (A) any applicable law, rule or regulation, (B) its
charter or by-laws or operating agreement, as applicable, or (C) any
material agreement, order or other instrument to which it is a party or
its property is subject and (iv) will not result in any Adverse Claim
on any Receivable, Related Security or Collection or give cause for the
acceleration of any of its indebtedness.
(c) No Consent Required. Other than the filing of financing
statements no approval, authorization or other action by, or filings
with, any Governmental Authority or other Person is required in
connection with the execution, delivery and performance by it of any
Transaction Document to which it is a party or any transaction
contemplated thereby.
(d) Binding Effect. Each Transaction Document to which it is
a party constitutes the legal, valid and binding obligation of such
Person enforceable against that Person in accordance with its terms,
except as limited by bankruptcy, insolvency, or other similar laws of
general application relating to or affecting the enforcement of
creditors' rights generally and subject to general principles of
equity.
Section 4.2. Additional Representations by Each Originator. Each
Originator further represents and warrants to Buyer as follows:
(a) Perfection of Ownership Interest. Immediately preceding
its sale of Receivables to Buyer, such Originator was the owner of, and
effectively sold, such Receivables to Buyer, free and clear of any
Adverse Claim. Buyer owns the Receivables free of any Adverse Claim
other than the interests of the Purchasers and the Agent therein that
are created by the Second Tier Agreement and, in the case of
Receivables not designated as Eligible Receivables, other Adverse
Claims.
(b) Accuracy of Information. All information furnished by
each Originator in writing in connection with any Transaction Document,
or any transaction contemplated thereby, is true and accurate in all
material respects (and was not incomplete by omitting to state a
material fact necessary to make such information not materially
misleading).
(c) No Actions, Suits. There are no actions, suits or other
proceedings (including matters relating to environmental liability)
pending or threatened against or affecting any Originator or any of its
properties, that (i) if adversely determined (individually or in the
aggregate), is likely to have a material adverse effect on the
financial condition of the Parent and its subsidiaries, on a
consolidated basis or on the collectibility of a material portion of
the Receivables or (ii) involve any Transaction
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Document or any transaction contemplated thereby. No Originator is in
default of any contractual obligation or in violation of any material
order, rule or regulation of any Governmental Authority, which default
or violation is likely to have a material adverse effect upon (i) the
financial condition of the Parent and its subsidiaries, on a
consolidated basis or (ii) the collectibility of a material portion of
the Receivables.
(d) No Material Adverse Change. Since December 31, 2000,
there has been no material adverse change in (i) such Originator's
financial condition, business, operations or prospects or (ii) such
Originator's ability to perform its obligations under any Transaction
Document.
(e) Accuracy of Exhibits. All information on Exhibits E and F
of the Second Tier Agreement (to the extent describing an Originator)
is true and complete, subject to any changes permitted by, and notified
to the Agent in accordance with the Second Tier Agreement.
(f) Sales by Originator. Each sale by such Originator to
Buyer of an interest in Receivables has been made for "reasonably
equivalent value" (as such term is used in Section 548 of the
Bankruptcy Code) and not for or on account of "antecedent debt" (as
such term is used in Section 547 of the Bankruptcy Code) owed by such
Originator to Buyer.
SECTION 5. GENERAL COVENANTS.
Section 5.1. Covenants. Each Originator hereby covenants and agrees to
comply with the following covenants and agreements, unless Buyer (with the
consent of the Agent) shall otherwise consent:
(a) Financial Reporting. Each Originator will maintain a
system of accounting established and maintained in accordance with GAAP
and will furnish to Buyer:
(i) Within 120 days after each fiscal year of the
Parent copies of Parent's annual audited financial statements
(including a consolidated balance sheet, consolidated
statement of income and retained earnings and statement of
cash flows, with related footnotes) certified by Deloitte &
Touche or other independent certified public accountants of
nationally recognized standing and prepared on a consolidated
basis in conformity with GAAP;
(ii) Within 45 days after each (except the last)
fiscal quarter of each fiscal year of the Parent, copies of
the Parent's unaudited financial statements (including at
least a consolidated balance sheet as of the close of such
quarter and statements of earnings and sources and
applications of funds for the period from the beginning of the
fiscal year to the close of such quarter) certified by the
chief financial officer and prepared in a manner consistent
with the financial statements described in part (A) of clause
(i) of this Section 5.1(a);
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(iii) copies of all financial statements, reports and
returns which the Parent shall send to its stockholders;
(iv) Promptly upon becoming available, a copy of each
report or proxy statement filed by the Parent with the
Securities and Exchange Commission or any securities exchange;
and
(v) with reasonable promptness such other information
(including non-financial information) as Buyer may reasonably
request.
(b) Notices. Promptly and in any event within three Business
Days after a Responsible Officer of an Originator obtains knowledge of
any of the following, such Originator will notify Buyer and provide a
description of:
(i) Potential Termination Events. The occurrence of
any Potential Termination Event;
(ii) Representations and Warranties. The failure of
any representations or warranty herein to be true when made in
any material respect;
(iii) Litigation. The institution of any litigation,
arbitration proceeding or governmental proceeding which is
reasonably likely to be material to such Originator or the
collectibility or quality of a material portion of the
Receivables; or
(iv) Judgments. The entry of any uninsured judgment
or decree against such Originator if the aggregate amount of
all such uninsured judgments then outstanding against such
Originator exceeds $10,000,000.
(c) Conduct of Business. Each Originator will perform all
actions necessary to remain duly incorporated or organized, validly
existing and in good standing in its jurisdiction of incorporation or
organization and to maintain all requisite authority to conduct its
business in each jurisdiction in which it conducts business.
(d) Compliance with Laws. Each Originator will comply with
all laws, regulations, judgments and other directions or orders imposed
by any Governmental Authority to which each Originator or any
Receivable, any Related Security or Collection may be subject.
(e) Furnishing Information and Inspection of Records. Each
Originator will furnish to Buyer such information concerning the
Receivables originated by it as Buyer may reasonably request, subject
to any confidentiality restrictions. Each Originator will permit, at
any time during regular business hours, Buyer (or any representatives
thereof) (i) to examine and make copies of all Records, (ii) to visit
the offices and properties of such Originator or office of any other
Person for the purpose of examining the Records and (iii) to discuss
matters relating hereto with any of such Originator's officers,
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directors, employees or independent public accountants having knowledge
of such matters. Once a year, Buyer may (at the expense of the
applicable Originator) have an independent public accounting firm
conduct an audit of the Records or make test verification of the
Receivables and Collections in connection with the audit and test
verifications conducted on behalf of the Agent under the Second Tier
Agreement.
(f) Keeping Records. (i) Each Originator will have and
maintain (A) administrative and operating procedures (including an
ability to recreate Records if originals are destroyed), (B) adequate
facilities, personnel and equipment and (C) all Records and other
information necessary or advisable for collecting the Receivables
originated by it (including Records adequate to permit the immediate
identification of each new Receivable originated by it and all
Collections of, and adjustments to, each existing Receivable originated
by it). Each Originator will give Buyer prior notice of any material
change in such administrative operating procedures.
(ii) Each Originator will, (A) at all times from and after the
date hereof, clearly and conspicuously xxxx its computer and master
data processing books and records with a legend describing Buyer's
interest in the Receivables originated by it and the Collections.
(g) Perfection. (i) Each Originator will at its expense,
promptly execute and deliver all instruments and documents and take all
action necessary or requested by the Buyer (including the execution and
filing of financing or continuation statements, amendments thereto or
assignments thereof) to enable the Buyer to exercise and enforce all
its rights against the Receivables originated by it and to vest and
maintain vested in the Buyer a valid, first priority perfected security
interest in such Receivables, the related Collections, and proceeds
thereof free and clear of any Adverse Claim (and a perfected ownership
interest in such Receivables and Collections to the extent of the Sold
Interest). To the extent permitted by applicable law, the Buyer will be
permitted to sign and file any continuation statements, amendments
thereto and assignments thereof without the Buyer's signature.
(ii) The Buyer will not change its name, identity or corporate
structure or relocate its chief executive office or the Records except
after thirty (30) days advance notice to the Buyer and the delivery to
the Buyer of all financing statements, instruments and other documents
(including direction letters) requested by the Buyer.
(iii) Each Originator will at all times maintain its chief
executive offices within a jurisdiction in the USA in which Article 9
of the UCC (as it may be amended from time to time) is in effect. If
any Originator moves its chief executive office to a location that
imposes Taxes, fees or other charges to perfect the Buyer's interests
hereunder, such Originator will pay all such amounts and any other
costs and expenses incurred in order to maintain the enforceability of
the Transaction Documents, the Sold Interest and the interests of the
Buyer in the Receivables, the Related Security and Collections.
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(h) Payments on Receivables, Accounts. Each Originator will
at all times instruct all Obligors to deliver payments on the
Receivables to a Lock-Box. If any such payments or other Collections
are received by an Originator, it shall hold such payments in trust for
the benefit of the Buyer and promptly (but in any event within two
Business Days after receipt) remit such funds at the direction of the
Buyer. Each Originator will cause each Lock-Box Bank to comply with the
terms of each applicable Lock-Box Letter. After the occurrence of a
Termination Event or the Liquidity Termination Date, such Originator
will not, and will not permit any Collection Agent or other Person to,
commingle Collections or other funds to which the Buyer is entitled
with any other funds. Each Originator shall only add a Lock-Box Bank,
Lock-Box, or Lock-Box Account to those listed on Exhibit F of the
Second Tier Agreement if the Buyer has received notice of such
addition, a copy of any new Lock-Box Agreement and an executed and
acknowledged copy of a Lock-Box Letter substantially in the form of
Exhibit G of the Second Tier Agreement (with such changes as are
acceptable to the Buyer) from any new Lock-Box Bank. Each Originator
shall only terminate a Lock-Box Bank or Lock-Box, or close a Lock-Box
Account, upon 30 days advance notice to the Buyer.
(i) Sales and Adverse Claims Relating to Receivables. Except
as otherwise provided herein, no Originator will (by operation of law
or otherwise) dispose of or otherwise transfer, or create or suffer to
exist any Adverse Claim upon, any Receivable or any proceeds thereof.
(j) Extension or Amendment of Receivables. Except as
otherwise permitted in the Second Tier Agreement and then subject to
Section 1.5 of the Second Tier Agreement, no Originator will extend,
amend, rescind or cancel any Receivable.
(k) Performance of Duties. Each Originator will perform its
duties or obligations in accordance with the provisions of each of the
Transaction Documents to which it is a party. Each Originator (at its
expense) will (i) fully and timely perform in all material respects all
agreements, if any, required to be observed by it in connection with
each Receivable originated by it, (ii) comply in all material respects
with the Credit and Collection Policy, and (iii) refrain from any
action that may impair the rights of Buyer in the Receivables,
Collections or Lock-Box Accounts.
(l) Change in Business or Credit and Collection Policy. No
Originator will make any change in its Credit and Collection Policy
which change would impair the collectibility of any Receivable.
(m) Accounting for Sale. No Originator will account for, or
otherwise treat, the transactions contemplated hereby other than as a
sale of Receivables or inconsistent with the Purchasers' ownership
interests in the Receivables and Collections.
(n) Certain Agreements. Except as otherwise permitted by this
Agreement, no Originator will amend, modify, waive, revoke or terminate
any Transaction Document to which it is a party.
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Section 5.2. Organizational Separateness. Each Originator agrees not to
take any action that would cause Buyer to violate its articles of incorporation
or certification of incorporation, as appropriate, and bylaws or its limited
liability company agreement or operating agreement, as applicable. Buyer agrees
to conduct its business in a manner consistent with its articles of
incorporation or certification of incorporation, as appropriate, and bylaws or
its limited liability company agreement or operating agreement, as applicable.
SECTION 6. TERMINATION OF PURCHASES.
Section 6.1. Voluntary Termination. The purchase and sale of
Receivables pursuant to this Agreement may be terminated by any party, upon at
least five Business Days' prior written notice to the other parties.
Section 6.2. Automatic Termination. The purchase and sale of
Receivables pursuant to this Agreement shall automatically terminate upon the
occurrence of (i) a Bankruptcy Event with respect to any Originator, (ii) a
Trigger Event or (iii) the Liquidity Termination Date.
SECTION 7. INDEMNIFICATION.
Section 7.1. Originators' Indemnity. Without limiting any other rights
any Person may have hereunder or under applicable law, each Originator, jointly
and severally, hereby indemnifies and holds harmless Buyer and its officers,
directors, agents and employees (each an "Indemnified Party") from and against
any and all damages, losses, claims, liabilities, penalties, Taxes, costs and
expenses (including reasonable attorneys' fees and court costs actually
incurred) (all of the foregoing collectively, the "Indemnified Losses") at any
time imposed on or incurred by any Indemnified Party arising out of or otherwise
relating to any Transaction Document, the transactions contemplated thereby, or
any action taken or omitted by any of the Indemnified Parties, whether arising
by reason of the acts to be performed by such Originator hereunder or otherwise,
excluding only Indemnified Losses ("Excluded Losses") to the extent (a) a final
judgment of a court of competent jurisdiction holds such Indemnified Losses
resulted solely from gross negligence or willful misconduct of the Indemnified
Party seeking indemnification, (b) solely due to the credit risk or financial
inability to pay of the Obligor and for which reimbursement would constitute
recourse to such Originator or the Collection Agent for uncollected or
uncollectible Receivables or (c) such Indemnified Losses include Taxes on, or
measured by, the overall net income or gross receipts of the Buyer. Without
limiting the foregoing indemnification, but subject to the limitations set forth
in clauses (a), (b) and (c) of the previous sentence, each Originator, jointly
and severally, shall indemnify each Indemnified Party for Indemnified Losses
relating to or resulting from:
(i) any representation or warranty made by or on behalf of an
Originator under or in connection with this Agreement, any Periodic
Report or any other information or report delivered by an Originator
pursuant to the Transaction Documents, which shall have been false or
incorrect in any material respect when made or deemed made;
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(ii) the failure by an Originator to comply with any
applicable law, rule or regulation related to any Receivable, or the
nonconformity of any such Receivable with any such applicable law, rule
or regulation;
(iii) the failure of an Originator to vest and maintain vested
in Buyer, a perfected ownership or security interest in the Receivables
and the other property conveyed pursuant hereto, free and clear of any
Adverse Claim;
(iv) any commingling of funds to which Buyer is entitled
hereunder with any other funds;
(v) any failure of a Lock-Box Bank to comply with the terms of
the applicable Lock-Box Letter;
(vi) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor or financial inability of the
Obligor to pay) of the Obligor to the payment of any Receivable, or any
other claim resulting from the sale or lease of goods or the rendering
of services related to such Receivable or the furnishing or failure to
furnish any such goods or services;
(vii) any failure of an Originator to perform its duties or
obligations in accordance with the provisions of this Agreement or any
other Transaction Document to which an Originator is a party; or
(viii) any environmental liability claim, 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 any Receivable or any other suit, claim or action of
whatever sort relating to any of any Originator's obligations under the
Transaction Documents.
Section 7.2. Indemnification Due to Failure to Consummate Purchase.
Each Originator will indemnify Buyer on demand and hold it harmless against all
costs (including, without limitation, breakage costs) and expenses incurred by
Buyer resulting from any failure by such Originator to consummate a purchase
after Buyer has requested a transfer of the applicable Receivables to the
Purchasers under the terms of the Second Tier Agreement.
SECTION 8. MISCELLANEOUS.
Section 8.1. Amendments, Waivers, etc. No amendment of this Agreement
or waiver of any provision hereof or consent to any departure by either party
therefrom shall be effective without the written consent of the party that is
sought to be bound. Any such waiver or consent shall be effective only in the
specific instance given. No failure or delay on the part of either party 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. Each Originator agrees that the
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Purchasers may rely upon the terms of this Agreement, and that the terms of this
Agreement may not be amended, nor any material waiver of those terms be granted,
without the consent of the Agent; provided that such Originator and Buyer may
agree to an adjustment of the purchase price for any Receivable originated by
such Originator without the consent of the Agent provided that the purchase
price paid for such Receivable shall be an amount not less than adequate
consideration that represents fair value for such Receivable.
Section 8.2. Assignment of Receivables Purchase Agreement. Each
Originator hereby acknowledges that on the date hereof Buyer has collaterally
assigned for security purposes all of its right, title and interest in, to and
under this Agreement to the Agent for the benefit of the Purchasers pursuant to
the Second Tier Agreement and that the Agent and the Purchasers are third party
beneficiaries hereof. Each Originator hereby further acknowledges that after the
occurrence and during the continuation of a Termination Event all provisions of
this Agreement shall inure to the benefit of the Agent and the Purchasers,
including the enforcement of any provision hereof to the extent set forth in the
Second Tier Agreement, but that neither the Agent nor any Purchaser shall have
any obligations or duties under this Agreement. No purchases shall take place
hereunder at any time that the Agent has exercised its right to enforce Buyer's
rights hereunder pursuant to Section 1.8 of the Second Tier Agreement. Each
Originator hereby further acknowledges that the execution and performance of
this Agreement are conditions precedent for the Agent and the Purchasers to
enter into the Second Tier Agreement and that the agreement of the Agent and
Purchasers to enter into the Second Tier Agreements will directly or indirectly
benefit such Originator and constitutes good and valuable consideration for the
rights and remedies of the Agent and each Purchaser with respect hereto.
Section 8.3. Binding Effect; Assignment. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns and shall also, to the extent provided herein, inure to
the benefit of the parties to the Second Tier Agreement. Each Originator
acknowledges that Buyer's rights under this Agreement are being assigned to the
Agent under the Second Tier Agreement and consents to such assignment and to the
exercise of those rights directly by the Agent, to the extent permitted by the
Second Tier Agreement.
Section 8.4. Survival. The rights and remedies with respect to any
breach of any representation and warranty made by an Originator or Buyer
pursuant to Section 4 and the indemnification provisions of Section 7 shall
survive any termination of this Agreement.
Section 8.5. Costs, Expenses and Taxes. In addition to the obligations
of the Originators under Section 7, each party (the Originators being one party
and the Buyer the other party) hereto agrees to pay on demand all costs and
expenses incurred by the other party and its assigns (other than Excluded
Losses) in connection with the enforcement of, or any actual or claimed breach
of, this Agreement, including the reasonable fees and expenses of counsel to any
of such Persons incurred in connection with any of the foregoing or in advising
such Persons as to their respective rights and remedies under this Agreement in
connection with any of the foregoing. Each Originator, jointly and severally,
also agrees to pay on demand all stamp and other taxes and fees payable or
determined to be payable in connection with the execution, delivery, filing, and
recording of this Agreement.
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Section 8.6. Execution in Counterparts; Integration. This Agreement may
be executed in any number of counterparts and by the different parties 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.
Section 8.7. Governing Law; Submission to Jurisdiction. This Agreement
shall be governed by, and construed in accordance with, the internal laws (and
not the law of conflicts) of the State of Illinois. Each Originator hereby
submits to the nonexclusive jurisdiction of the United States District Court for
the Northern District of Illinois and of any Illinois state court sitting in
Chicago for purposes of all legal proceedings arising out of, or relating to,
the Transaction Documents or the transactions contemplated thereby. Each
Originator hereby irrevocably waives, to the fullest extent permitted by law,
any objection it may now or hereafter have to the venue of any such proceeding
and any claim that any such proceeding has been brought in an inconvenient
forum. Nothing in this Section 8.7 shall affect the right of Buyer to bring any
action or proceeding against an Originator or its property in the courts of
other jurisdictions.
Section 8.8. No Proceedings. Each Originator agrees, for the benefit of
the parties to the Second Tier Agreement, that it will not institute against
Buyer, or join any other Person in instituting against Buyer, any proceeding of
a type referred to in the definition of Bankruptcy Event until one year and one
day after no investment, loan or commitment is outstanding under the Second Tier
Agreement.
In addition, all amounts payable by Buyer to an Originator pursuant to
this Agreement shall be payable solely from funds available for that purpose
(after Buyer has satisfied all obligations then due and owing under the Second
Tier Agreement).
Section 8.9. Loans by Buyer to Originators. Buyer may make loans to an
Originator from time to time if so agreed between such parties and to the extent
that Buyer has funds available for that purpose after satisfying its obligations
under this Agreement and the Second Tier Agreement. Any such loan shall be
payable upon demand (and may be prepaid with penalty or premium) and shall bear
interest at such rate as Buyer and such Originator shall from time to time
agree.
Section 8.10. Notices. Unless otherwise specified, all notices and
other communications hereunder shall be in writing (including by telecopier or
other facsimile communication), given to the appropriate Person at its address
or telecopy number set forth in the Second Tier Agreement or at such other
address or telecopy number as such Person may specify, and effective when
received at the address specified by such Person.
Section 8.11. Entire Agreement. This Agreement constitutes the entire
understanding of the parties thereto concerning the subject matter thereof. Any
previous or contemporaneous agreements, whether written or oral, concerning such
matters are superseded thereby.
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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.
XXXXX EXHAUST LLC, as Originator
By
Name: _______________________________________
Title:_______________________________________
XXXXXXX RIDE CONTROL PRODUCTS, INC., as
Originator
By
Name:________________________________________
Title:_______________________________________
MAREMONT EXHAUST PRODUCTS, INC., as
Originator
By
Name:________________________________________
Title:_______________________________________
PUROLATOR PRODUCTS NA, INC., as Originator
By
Name:________________________________________
Title:_______________________________________
ARVINMERITOR RECEIVABLES CORPORATION,
as Buyer
By
Name:________________________________________
Title:_______________________________________
The undersigned has caused this Agreement to be executed by its
officers thereunto duly authorized, as of the date first above written solely
for the purposes set forth in Section 3.1 of this Agreement.
ARVINMERITOR, INC.
By
Name:________________________________________
Title:_______________________________________
Signature Page for
Purchase and Sale Agreement
18
EXHIBIT A
PURCHASE PRICE
