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EXHIBIT 4.1
EXECUTION COPY
RECEIVABLES PURCHASE AGREEMENT
Dated as of June 29, 2001
Among
CXP FUNDING, LLC
as the Seller
and
ATLANTIC ASSET SECURITIZATION CORP.
as the Investor
and
CREDIT LYONNAIS NEW YORK BRANCH
as a Bank
and
CREDIT LYONNAIS NEW YORK BRANCH
as the Agent
and
CENTEX CONSTRUCTION PRODUCTS, INC.
as Parent and as Collection Agent
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TABLE OF CONTENTS
Page
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PRELIMINARY STATEMENT.............................................................................................1
ARTICLE I
DEFINITIONS..................................................................................................1
SECTION 1.01. Certain Defined Terms.................................................1
SECTION 1.02. Other Terms..........................................................22
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES..........................................................................22
SECTION 2.01. Purchase Facility....................................................22
SECTION 2.02. Making Purchases.....................................................23
SECTION 2.03. Receivable Interest Computation......................................24
SECTION 2.04. Settlement Procedures................................................24
SECTION 2.05. Fees.................................................................27
SECTION 2.06. Payments and Computations, Etc.......................................27
SECTION 2.07. Dividing or Combining Receivable Interests...........................28
SECTION 2.08. Increased Costs......................................................28
SECTION 2.09. Additional Yield on Receivable Interests Bearing
a Eurodollar Rate...........................................29
SECTION 2.10. Taxes................................................................29
SECTION 2.11. Security Interest....................................................30
SECTION 2.12. Repurchase Option....................................................31
ARTICLE III
CONDITIONS OF PURCHASES.....................................................................................32
SECTION 3.01. Conditions Precedent to Initial Purchase.............................32
SECTION 3.02. Conditions Precedent to All Purchases and Reinvestments..............34
ARTICLE IV
REPRESENTATIONS AND WARRANTIES..............................................................................35
SECTION 4.01. Representations and Warranties of the Seller.........................35
SECTION 4.02. Representations and Warranties of the Collection Agent...............38
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ARTICLE V
COVENANTS...................................................................................................40
SECTION 5.01. Covenants of the Seller..............................................40
SECTION 5.02. Covenants of the Seller and Parent...................................48
SECTION 5.03. Covenant of the Parent...............................................48
ARTICLE VI
ADMINISTRATION AND COLLECTION OF POOL RECEIVABLES ..........................................................50
SECTION 6.01. Designation of Collection Agent......................................50
SECTION 6.02. Duties of Collection Agent...........................................51
SECTION 6.03. Certain Rights of the Agent..........................................52
SECTION 6.04. Rights and Remedies..................................................53
SECTION 6.05. Further Actions Evidencing Purchases.................................53
SECTION 6.06. Audits; Changes in Credit and Collection Policy......................54
SECTION 6.07. Indemnities by the Collection Agent..................................55
ARTICLE VII
EVENTS OF TERMINATION.......................................................................................56
SECTION 7.01. Events of Termination................................................56
SECTION 7.02. Stop Purchase Events.................................................60
ARTICLE VIII
THE AGENT...................................................................................................60
SECTION 8.01. Authorization and Action.............................................60
SECTION 8.02. Agent's Reliance, Etc................................................60
SECTION 8.03. Credit Lyonnais and Affiliates.......................................61
SECTION 8.04. Bank's Purchase Decision.............................................61
ARTICLE IX
INDEMNIFICATION.............................................................................................62
SECTION 9.01. Indemnities by the Seller............................................62
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ARTICLE X
MISCELLANEOUS...............................................................................................64
SECTION 10.01. Amendments, Etc......................................................64
SECTION 10.02. Notices, Etc.........................................................65
SECTION 10.03. Assignability........................................................65
SECTION 10.04. Costs, Expenses and Taxes............................................66
SECTION 10.05. No Proceedings.......................................................66
SECTION 10.06. Confidentiality......................................................67
SECTION 10.07. GOVERNING LAW........................................................67
SECTION 10.08. Execution in Counterparts............................................68
SECTION 10.09. Survival of Termination..............................................68
SECTION 10.10. Consent to Jurisdiction..............................................68
SECTION 10.11. WAIVER OF JURY TRIAL.................................................68
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SCHEDULES
SCHEDULE I - Lock-Box Banks
SCHEDULE II - Credit and Collection Policy
SCHEDULE III - Normal Concentration Limits
SCHEDULE IV - Originators
ANNEXES
ANNEX A - Form of Seller Report
ANNEX B - Form of Lock-Box Agreement
ANNEX C - Forms of Opinions of Counsel to the Seller
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RECEIVABLES
PURCHASE AGREEMENT
Dated as of June 29, 2001
CXP FUNDING, LLC, a Delaware limited liability company (the
"Seller"),ATLANTIC ASSET SECURITIZATION CORP., a Delaware corporation, CREDIT
LYONNAIS
NEW YORK BRANCH, as agent (the "Agent") for the Investors and the Banks
(as defined herein)and as a Bank, and CENTEX CONSTRUCTION PRODUCTS, INC., a
Delaware corporation, as Parent and Collection Agent, agree as follows:
PRELIMINARY STATEMENT. The Seller has acquired, and may
continue to acquire, Receivables (as hereinafter defined) from the Parent,
either by purchase or by contribution to the capital of the Seller, as
determined from time to time by the Seller and the Parent. The Seller is
prepared to sell undivided fractional ownership interests (referred to and
defined herein as "Receivable Interests") in the Receivables. Atlantic may, in
its sole discretion, purchase such Receivable Interests, and the Banks shall, if
Atlantic does not, purchase such Receivable Interests, in each case on the terms
set forth herein. Accordingly, the parties agree as follows:
Article I
DEFINITIONS
SECTION 1.01. Certain Defined Terms. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"Adjusted Eurodollar Rate" means, for any Fixed Period, an
interest rate per annum equal to the rate per annum obtained by dividing (i) the
Eurodollar Rate for such Fixed Period by (ii) a percentage equal to 100% minus
the Eurodollar Rate Reserve Percentage for such Fixed Period.
"Administrative Services Agreement" means that Administrative
Services and Lease Agreement dated as of June 29, 2001 by and between the Parent
and the Seller pursuant to which the Parent will provide certain personnel and
equipment and lease office space to the Seller.
"Adverse Claim" means a lien, security interest or other
charge or encumbrance, or any other type of preferential arrangement.
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"Affiliate" means, as to any Person, any other Person that,
directly or indirectly, is in control of, is controlled by or is under common
control with such Person or, as used in Sections 6.07, 8.03 (other than the
first sentence of Section 8.03), 8.04, 9.01 and 10.04, is a director or officer
of such Person.
"Affiliated Obligor" means any Obligor that is an Affiliate of
another Obligor.
"Agent's Account" means the special account (account number
01-25680-0001-00-001) of the Agent maintained at the office of Credit Lyonnais
at 1301 Avenue of the Americas,
New York,
New York.
"Alternate Base Rate" means, as of any date, a fluctuating
interest rate per annum, which rate shall be equal to the higher of:
(a) the rate of interest announced by Credit Lyonnais
from time to time as its base rate (it being understood that
such rate is not necessarily intended to be the lowest rate of
interest determined by Credit Lyonnais in connection with
extensions of credit); and
(b) 1.40% per annum above the Federal Funds Rate for
such date.
"Asset Purchase Agreement" means, in the case of any Bank, the
liquidity asset purchase agreement entered into by such Bank concurrently with
its execution of this Agreement or of the Assignment and Acceptance pursuant to
which it became party to this Agreement.
"Assignee Rate" for any Fixed Period for any Receivable
Interest means an interest rate per annum equal to 2.40% per annum above the
Eurodollar Rate for such Fixed Period; provided, however, that in case of:
(i)any Fixed Period on or prior to the first day of
which an Investor or Bank shall have notified the Agent that
the introduction of or any change in or in the interpretation
of any law or regulation makes it unlawful, or any central
bank or other governmental authority asserts that it is
unlawful, for such Investor or Bank to fund such Receivable
Interest at the Assignee Rate set forth above (and such
Investor or Bank shall not have subsequently notified the
Agent that such circumstances no longer exist),
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(ii) any Fixed Period of one to (and including) 29
days (it being understood and agreed that this clause (ii)
shall not be applicable to a Fixed Period for which Yield is
to be computed by reference to the Eurodollar Rate that is
intended to have a one-month duration but due solely to LIBOR
interest period convention the duration thereof will be less
than 30 days),
(iii) any Fixed Period as to which the Agent does not
receive notice, by no later than 12:00 noon (
New York City
time) on the third Business Day preceding the first day of
such Fixed Period, that the related Receivable Interest will
not be funded by issuance of commercial paper, or
(iv) any Fixed Period for a Receivable Interest the
Capital of which allocated to the Investors or the Banks is
less than $500,000,
the "Assignee Rate" for such Fixed Period shall be an interest rate per annum
equal to the Alternate Base Rate in effect from time to time during such Fixed
Period; provided further that the Agent and the Seller may agree in writing from
time to time upon a different "Assignee Rate."
"Atlantic" means Atlantic Asset Securitization Corp. and any
successor or permitted assign of Atlantic that is a receivables investment
company which in the ordinary course of its business issues commercial paper or
other securities to fund its acquisition and maintenance of receivables.
"Bank Commitment" of any Bank means, (a) with respect to
Credit Lyonnais, $50,000,000 or such amount as reduced by any assignment entered
into between Credit Lyonnais and other Banks; or (b) with respect to a Bank that
has entered into an assignment, the amount set forth therein as such Bank's Bank
Commitment, in each case as such amount may be reduced by an assignment entered
into between such Bank and an Eligible Assignee, and as may be further reduced
(or terminated) pursuant to the next sentence. Any reduction (or termination) of
the Purchase Limit pursuant to the terms of this Agreement shall reduce ratably
(or terminate) each Bank's Bank Commitment.
"Banks" means Credit Lyonnais and each Eligible Assignee that
shall become a party to this Agreement pursuant to Section 10.03.
"Business Day" means any day on which (i) banks are not
authorized or required to close in
New York City or Dallas,
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Texas, and (ii) if this definition of "Business Day" is utilized in connection
with the Eurodollar Rate, dealings are carried out in the London interbank
market.
"Capital" of any Receivable Interest means the original amount
paid to the Seller for such Receivable Interest at the time of its purchase by
Atlantic or a Bank pursuant to this Agreement, or such amount divided or
combined in accordance with Section 2.07, in each case reduced from time to time
by Collections distributed on account of such Capital pursuant to Section
2.04(d); provided that if such Capital shall have been reduced by any
distribution and thereafter all or a portion of such distribution is rescinded
or must otherwise be returned for any reason, such Capital shall be increased by
the amount of such rescinded or returned distribution, as though it had not been
made.
"Centex" means Centex Corporation, a Nevada corporation.
"Collection Agent" means at any time the Person then
authorized pursuant to Section 6.01 to administer and collect Pool Receivables,
in its capacity as Collection Agent, which initially will be the Parent.
"Collection Agent Fee" has the meaning specified in Section
2.05(a).
"Collections" means, with respect to any Receivable, all cash
collections and other cash proceeds of such Receivable, including, without
limitation, all cash proceeds of Related Security with respect to such
Receivable, and any Collection of such Receivable deemed to have been received
pursuant to Section 2.04.
"Commitment Termination Date" means the earliest of (a) June
28, 2002, unless, prior to such date (or the date so extended pursuant to this
clause), upon the Seller's request, made not more than 90 nor less than 45 days
prior to the then Commitment Termination Date, one or more Banks having Bank
Commitments equal to 100% of the Purchase Limit shall in their sole discretion
consent, which consent shall be given not more than 30 days nor less than 15
days prior to the then Commitment Termination Date, to the extension of the
Commitment Termination Date to the date occurring 364 days after the then
Commitment Termination Date; provided, however, that any failure of any Bank to
respond to the Seller's request for such extension shall be deemed a denial of
such request by such Bank, (b) the date determined pursuant to Section 7.01, and
(c) the date the Purchase Limit reduces to zero pursuant to Section 2.01(b).
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"Concentration Limit" means (i) at any time for any Obligor
(other than an Obligor referred to in clause (ii) below), the "Normal
Concentration Limit" set forth on Schedule III hereto corresponding to such
Obligor's Debt Rating at such time, and (ii) at any time that Paperboard shall
be an Originator hereunder, for Xxxxx Xxxxxx N.V. together with any of its
Affiliates, 5%, and for Lafarge Corporation, together with any of its
Affiliates, 8% or such other percentage ("Special Concentration Limit") for such
Obligor designated by the Agent in a writing delivered to the Seller;
provided,that if the Debt Rating of Lafarge Corporation is withdrawn at any time
by either Xxxxx'x or S&P or reduced at any time by either Xxxxx'x or S&P below
the Debt Rating for Lafarge Corporation on the date hereof, then the Special
Concentration Limit described above in respect of Lafarge Corporation and any of
its Affiliates shall be canceled; and provided, further, that in the case of an
Obligor with any Affiliated Obligor, the Concentration Limit shall be calculated
as if such Obligor and all such Affiliated Obligors are one Obligor; provided,
however, that if the "Normal Concentration Limit" set forth on Schedule III
hereto corresponding to the Debt Rating of such Obligor and Affiliated Obligors
are different, then the lowest such Normal Concentration Limit shall apply to
such Obligor and Affiliated Obligors; and provided further that the Agent may
cancel any Special Concentration Limit upon three Business Days' notice to the
Seller.
"Contract" means an agreement between an Originator and an
Obligor, in the form of a written contract or (in the case of any open account
agreement) an invoice conforming to the applicable Originator's Credit and
Collection Policy, pursuant to or under which such Obligor shall be obligated to
pay for merchandise or services from time to time.
"Credit Agreement" means the Credit Agreement dated as of
November 10, 2000 (as amended by the amendment dated December 20, 2000) among
the Parent, Republic Holding Corporation, the lenders listed therein, Bank of
America, N.A., as syndication agent, PNC Bank, N.A., as documentation agent and
Bank One, Texas, N.A., as letter of credit issuer and as administrative agent.
"Credit and Collection Policy" means, for each Originator,
those receivables credit and collection policies and practices of such
Originator in effect on the date of this Agreement and described in Schedule II
hereto, as modified in compliance with this Agreement.
"Credit Lyonnais" means Credit Lyonnais
New York Branch, a
branch licensed under the laws of the State of
New York of a banking corporation
organized under the laws of the Republic of France.
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"Days Sales Outstanding" means, on any date, an amount equal
to
OBPR x 30
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S
where:
OBPR = the aggregate Outstanding Balance of all Pool
Receivables at the end of the most recently ended
month.
S = the aggregate Outstanding Balance (in each case at
the time of creation) of all Pool Receivables created
during the most recently ended month.
"Debt" means (i) indebtedness for borrowed money, (ii)
obligations evidenced by bonds, debentures, notes or other similar instruments,
(iii) obligations to pay the deferred purchase price of property or services,
(iv) obligations as lessee under leases which shall have been or should be, in
accordance with generally accepted accounting principles, recorded as capital
leases, and (v) obligations under direct or indirect guaranties in respect of,
and obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (i) through (iv)
above.
"Debt Rating" means, for any Person, the rating by S&P or
Xxxxx'x of such Person's short-term senior unsecured non-credit-enhanced debt.
"Default Ratio" means the ratio (expressed as a percentage)
computed as of the last day of each calendar month by dividing (i) the aggregate
Outstanding Balance of all Originator Receivables that were Defaulted
Receivables on such day or that would have been Defaulted Receivables on such
day had they not been written off the books of an Originator or the Seller
during such month by (ii) the aggregate Outstanding Balance of all Originator
Receivables on such day.
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"Defaulted Receivable" means an Originator Receivable:
(i) as to which any payment, or part thereof, remains
unpaid for 91 or more days from the original due date for such
payment;
(ii) as to which the Obligor thereof or any other
Person obligated thereon or owning any Related Security in
respect thereof has taken any action, or suffered any event to
occur, of the type described in Section 7.01(g); or
(iii) which, consistent with the applicable
Originator's Credit and Collection Policy, would be written
off the applicable Originator's or the Seller's books as
uncollectible.
"Delinquency Ratio" means the ratio (expressed as a
percentage) computed as of the last day of each calendar month by dividing (i)
the aggregate Outstanding Balance of all Originator Receivables that were
Delinquent Receivables on such day by (ii) the aggregate Outstanding Balance (in
each case, at the time of creation) of all Originator Receivables created during
the fourth preceding month.
"Delinquent Receivable" means an Originator Receivable that is
not a Defaulted Receivable and:
(i) as to which any payment, or part thereof, remains
unpaid for 61 or more days from the original due date for such
payment; or
(ii) which, consistent with the applicable
Originator's Credit and Collection Policy, would be classified
as delinquent by the applicable Originator or the Seller.
"Diluted Receivable" means that portion (and only that
portion) of any Originator Receivable which is either (a) reduced or canceled as
a result of (i) any defective, rejected or returned merchandise or services or
any failure by an Originator to deliver any merchandise or provide any services
or otherwise to perform under the underlying Contract, (ii) any change in the
terms of or cancellation of a Contract or any cash discount, discount for quick
payment or other adjustment by an Originator or any other Person which reduces
the amount payable by the Obligor on the related Originator Receivable (except
any such change or cancellation resulting from or relating to the financial
inability to pay or insolvency of the Obligor of such Originator Receivable) or
(iii) any set-off by an Obligor in
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respect of any claim by such Obligor as to amounts owed by it on the related
Originator Receivable (whether such claim arises out of the same or a related
transaction or an unrelated transaction) or (b) subject to any specific dispute,
offset, counterclaim or defense whatsoever (except the discharge in bankruptcy
of the Obligor thereof), including, without limitation, any non-payment by the
Obligor due to failure by an Originator to deliver any merchandise or provide
any services; provided that Diluted Receivables are calculated assuming that all
chargebacks are resolved in the Obligor's favor and do not include contractual
adjustments to the amount payable by an Obligor that are eliminated from an
Originator Receivables balance sold to the Seller through a reduction in the
purchase price paid by the Seller for the related Originator Receivable.
"Dilution Horizon Factor" means, as of any date, a ratio
(expressed as a percentage) computed by dividing (i) the aggregate Outstanding
Balance (in each case, at the time of creation) of all Originator Receivables
created by the Originators during the most recently ended calendar month by (ii)
the Outstanding Balance of Eligible Receivables in the Receivables Pool as at
the last day of the most recently ended calendar month.
"Dilution Percentage" means, as of any date, the greater of
(a) the product of (i) the sum of (A) the product of (1) two multiplied by (2)
the average of the Dilution Ratios for each of the twelve most recently ended
calendar months, plus (B) the Dilution Volatility Ratio as at the last day of
the most recently ended calendar month, multiplied by (ii) the Dilution Horizon
Factor as of such date and (b) 10%.
"Dilution Ratio" means, as of any date, the ratio (expressed
as a percentage) computed for the most recently ended calendar month by dividing
(i) the aggregate amount of Originator Receivables which became Diluted
Receivables during such calendar month by (ii) the aggregate Outstanding Balance
(in each case, at the time of creation) of all Originator Receivables created
during the calendar month immediately preceding such calendar month.
"Dilution Reserve" means, for any Receivable Interest on any
date, an amount equal to:
DP x C
where:
DP = the Dilution Percentage on such date.
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C = the Capital of such Receivable Interest on such
date.
"Dilution Volatility Ratio" means, as of any date, a ratio
(expressed as a percentage) equal to the product of (a) the highest of the
Dilution Ratios calculated for each of the twelve most recently ended calendar
months minus the average of the Dilution Ratios for each of the twelve most
recently ended calendar months, and (b) a ratio calculated by dividing the
highest of the Dilution Ratios calculated for each of the twelve most recently
ended calendar months by the average of the Dilution Ratios for each of the
twelve most recently ended calendar months.
"Eligible Assignee" means (i) Credit Lyonnais or any of its
Affiliates, (ii) any Person managed by Credit Lyonnais or any of its Affiliates
that is approved in writing by the Seller (such approval not to be unreasonably
withheld or delayed), or (iii) any financial or other institution acceptable to
the Agent that is approved in writing by the Seller (such approval not to be
unreasonably withheld or delayed); provided that if an Event of Termination or
Incipient Event of Termination has occurred and is continuing at the time of
such assignment, no approval by the Seller shall be required under clause (ii)
or (iii).
"Eligible Receivable" means, at any time, a Receivable:
(i) the Obligor of which (A) is a United States
resident, (B) is not an Affiliate of the Parent or any
Originator, (C) is not a government or a governmental
subdivision or agency and (D) is not USG Corporation or any of
its Subsidiaries, including, without limitation, L&W Supply
Corporation;
(ii) the Obligor of which, at the Origination Date,
is not the Obligor of any Defaulted Receivables which in the
aggregate constitute 30% or more of the aggregate Outstanding
Balance of all Receivables of such Obligor;
(iii) which is not a Defaulted or Delinquent
Receivable;
(iv) which, according to the Contract related
thereto, is required to be paid in full within 60 days of the
original billing date therefor;
(v) which is an "account" within the meaning of
Article 9 of the UCC of the applicable jurisdictions
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governing the perfection of the interest created by a
Receivable Interest;
(vi) which is denominated and payable only in United
States dollars in the United States;
(vii) which arises under a Contract which, together
with such Receivable, is in full force and effect and
constitutes the legal, valid and binding obligation of the
Obligor of such Receivable and is not subject to any Adverse
Claim or, at the Origination Date, any dispute, offset,
counterclaim or defense whatsoever (except the potential
discharge in bankruptcy of such Obligor);
(viii) which, together with the Contract related
thereto, does not contravene in any material respect any laws,
rules or regulations applicable thereto (including, without
limitation, laws, rules and regulations relating to usury,
consumer protection, truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy) and with respect to which
none of the Seller, the applicable Originator or the Obligor
is in violation of any such law, rule or regulation in any
material respect;
(ix) which arises under a Contract which (A) does not
require the Obligor thereunder to consent to the transfer,
sale or assignment of the rights and duties of the Seller or
the applicable Originator thereunder and (B) does not contain
a confidentiality provision that purports to restrict the
ability of the Agent, the Investors or the Banks to exercise
their rights under this Agreement, including, without
limitation, their right to review the Contract;
(x) which was generated in the ordinary course of the
applicable Originator's business;
(xi) which, at the Origination Date, has not been
extended, rewritten or otherwise modified from the original
terms thereof for credit-related reasons;
(xii) the transfer, sale or assignment of which does
not contravene any applicable law, rule or regulation;
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(xiii) which satisfies all applicable requirements of
the applicable Originator's Credit and Collection Policy; and
(xiv) as to which, prior to the Origination Date, the
Agent has not notified the Seller that such Receivable (or the
Obligor of such Receivable) is, in the reasonable good faith
judgment of Atlantic and the Banks, no longer acceptable for
purchase by Atlantic and the Banks hereunder.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve System, as
in effect from time to time.
"Eurodollar Rate" means, for any Fixed Period, an interest
rate per annum determined by the Agent equal to the offered rate per annum for
deposits in U.S. dollars in an amount substantially equal to the Capital
associated with such Fixed Period on the first day of such Fixed Period and for
a period equal to such Fixed Period, as of 11:00 A.M., London time, two Business
Days prior to the first day of the applicable Fixed Period, that appears on the
display designated as "Page 3750" on the Telerate Service (or such other page as
may replace "Page 3750" on that service for the purpose of displaying London
interbank offered rates of major banks); provided, that if such rate is not
available on any date when the Eurodollar Rate is to be determined, then the
rate shall be an interest rate per annum determined by the Agent equal to the
rate at which it would offer deposits in U.S. dollars to prime banks in the
London interbank market for a period equal to such Fixed Period and in an amount
substantially equal to the Capital associated with such Fixed Period at or about
11:00 A.M. (London Time) on the second Business Day before (and for value on)
the first day of such Fixed Period.
"Eurodollar Rate Reserve Percentage" of any Investor or Bank
for any Fixed Period in respect of which Yield is computed by reference to the
Eurodollar Rate means the reserve percentage applicable two Business Days before
the first day of such Fixed Period under regulations issued from time to time by
the Board of Governors of the Federal Reserve System (or any successor) (or if
more than one such percentage shall be applicable, the daily average of such
percentages for those days in such Fixed Period during which any such percentage
shall be so applicable) for determining the maximum reserve requirement
(including, without
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limitation, any emergency, supplemental or other marginal reserve requirement)
for such Investor or Bank with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other category of
liabilities that includes deposits by reference to which the interest rate on
Eurocurrency Liabilities is determined) having a term equal to such Fixed
Period.
"Event of Termination" has the meaning specified in Section
7.01.
"Facility Termination Date" means the earliest of (a) June 10,
2004 or (b) the date determined pursuant to Section 7.01 or (c) the date the
Purchase Limit reduces to zero pursuant to Section 2.01(b) or (d) the Commitment
Termination Date.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of
New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day
on such transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it.
"Fee Agreement" has the meaning specified in Section 2.05(b).
"Fees" has the meaning specified in Section 2.05(b).
"Fixed Period" means with respect to any Receivable Interest:
(a) initially the period commencing on the date of
purchase of such Receivable Interest and ending such number of
days as the Seller shall select and the Agent shall approve
pursuant to Section 2.02, up to three months from such date;
and
(b) thereafter each period commencing on the last day
of the immediately preceding Fixed Period for such Receivable
Interest and ending such number of days (not to exceed three
months) as the Seller shall select and the Agent shall approve
on notice by the Seller received by the Agent (including
notice by telephone, confirmed in writing) not later than
11:00 A.M. (New
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York City time) on such last day, except that if the Agent
shall not have received such notice or approved such period on
or before 11:00 A.M. (New York City time) on such last day,
such period shall be one day;
provided that (i) any Fixed Period in respect of which Yield is computed by
reference to the Assignee Rate shall be a period from one to and including 29
days, or a period of one, two or three months, as the Seller may select as
provided above; (ii) any Fixed Period (other than of one day) which would
otherwise end on a day which is not a Business Day shall be extended to the next
succeeding Business Day (provided, however, if Yield in respect of such Fixed
Period is computed by reference to the Eurodollar Rate, and such Fixed Period
would otherwise end on a day which is not a Business Day, and there is no
subsequent Business Day in the same calendar month as such day, such Fixed
Period shall end on the next preceding Business Day); (iii) in the case of any
Fixed Period of one day, (A) if such Fixed Period is the initial Fixed Period
for a Receivable Interest, such Fixed Period shall be the day of purchase of
such Receivable Interest; (B) any subsequently occurring Fixed Period which is
one day shall, if the immediately preceding Fixed Period is more than one day,
be the last day of such immediately preceding Fixed Period, and, if the
immediately preceding Fixed Period is one day, be the day next following such
immediately preceding Fixed Period; and (C) if such Fixed Period occurs on a day
immediately preceding a day which is not a Business Day, such Fixed Period shall
be extended to the next succeeding Business Day; and (iv) in the case of any
Fixed Period for any Receivable Interest which commences before the Termination
Date for such Receivable Interest and would otherwise end on a date occurring
after such Termination Date, such Fixed Period shall end on such Termination
Date and the duration of each Fixed Period which commences on or after the
Termination Date for such Receivable Interest shall be of such duration as shall
be selected by the Agent or, in the absence of any such selection, each period
of thirty days from the last day of the immediately preceding Fixed Period.
"Incipient Event of Termination" means an event that but for
notice or lapse of time or both would constitute an Event of Termination.
"Investor" means Atlantic and all other owners by permitted
assignment of a Receivable Interest originally purchased by Atlantic and, to the
extent of the undivided interests so purchased, shall include any participants.
"Investor Rate" for any Fixed Period for any Receivable
Interest means to the extent Atlantic funds such Receivable Interest for such
Fixed Period by issuing commercial paper, the
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rate per annum (or if more than one rate, the weighted average of the rates) at
which commercial paper notes of Atlantic having a term equal to such Fixed
Period and to be issued to fund such Receivable Interest may be sold by any
placement agent or commercial paper dealer selected by the Agent on behalf of
Atlantic, as agreed between each such agent or dealer and the Agent and notice
of which has been given by the Agent to the Collection Agent; provided if the
rate (or rates) as agreed between any such agent or dealer and the Agent for any
Fixed Period for any Receivable Interest is a discount rate (or rates), then
such rate shall be the rate (or if more than one rate, the weighted average of
the rates) resulting from converting such discount rate (or rates) to an
interest-bearing equivalent rate per annum.
"Liquidation Day" means, for any Receivable Interest, (i) each
day during a Fixed Period for such Receivable Interest on which the conditions
set forth in Section 3.02 are not satisfied, and (ii) each day which occurs on
or after the Termination Date for such Receivable Interest.
"Liquidation Fee" means, for (i) any Fixed Period during which
a Liquidation Day occurs or (ii) any Fixed Period for which Yield is computed by
reference to the Investor Rate or the Eurodollar Rate and a reduction of Capital
is made for any reason on any day other than the last day of such Fixed Period,
the amount, if any, by which (A) the additional Yield (calculated without taking
into account any Liquidation Fee or any shortened duration of such Fixed Period
pursuant to clause (iv) of the definition thereof) which would have accrued
during such Fixed Period on the reductions of Capital of the Receivable Interest
relating to such Fixed Period had such reductions remained as Capital, exceeds
(B) the income, if any, received by the Investors or the Banks which hold such
Receivable Interest from the investment of the proceeds of such reductions of
Capital.
"Lock-Box Account" means a post office box administered by a
Lock-Box Bank or an account maintained at a Lock-Box Bank, in each case for the
purpose of receiving Collections.
"Lock-Box Agreement" means an agreement, in substantially the
form of Annex B.
"Lock-Box Bank" means any of the banks holding one or more
Lock-Box Accounts.
"Loss Horizon Factor" means, as of any date, a ratio
(expressed as a percentage) computed by dividing (i) the aggregate Outstanding
Balance (in each case, at the time of creation) of all Originator Receivables
created by the
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Originators during the three most recently ended calendar months by (ii) the Net
Receivables Pool Balance as at the last day of the most recently ended calendar
month.
"Loss Percentage" means, as of any date, the greater of (a)
the product of (i) two multiplied by (ii) the Loss Horizon Factor as of the last
day of the most recently ended calendar month multiplied by (iii) the highest of
the Loss Ratios for the twelve most recently ended calendar months and (b) (i)
if Paperboard is then an Originator and the Special Concentration Limit for
either Xxxxx Xxxxxx N.V. or Lafarge Corporation exceeds the Normal Concentration
Limit, 20% and (ii) otherwise, 12%.
"Loss Ratio" means, as of any date, the average of the ratios
(each expressed as a percentage) for each of the three most recently ended
calendar months computed for each such month by dividing (a) the sum of the
aggregate Outstanding Balance of Originator Receivables which were 61-90 days
past due as at the last day of such month plus (without duplication) 1/12 of the
aggregate write-offs during such month and the preceding 11 months, by (b) the
aggregate Outstanding Balance (in each case, at the time of creation) of
Originator Receivables created during the fourth preceding month.
"Loss Reserve" means, for any Receivable Interest on any date,
an amount equal to:
LP x NRPB x C
---
AC
where:
LP = the Loss Percentage on such date.
NRPB = the Net Receivables Pool Balance on such date.
C = the Capital of such Receivable Interest on such
date.
AC = the aggregate Capital of all Receivable Interests
on such date.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Receivables Pool Balance" means at any time the
Outstanding Balance of Eligible Receivables then in the Receivables Pool reduced
by the sum of (i) the aggregate amount by which the Outstanding Balance of
Eligible Receivables of each Obligor then in the Receivables Pool exceeds the
product of
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(A) the Concentration Limit for such Obligor multiplied by (B) the Outstanding
Balance of Eligible Receivables of such Obligor, (ii) the aggregate amount of
Collections on hand at such time for payment on account of any Eligible
Receivables, the Obligor of which has not been identified and (iii) the
aggregate Outstanding Balance of all Eligible Receivables in respect of which
any credit memo issued by an Originator or the Seller is outstanding at such
time to the extent deemed Collections have not been paid pursuant to Section
2.04(e).
"Non-Significant Originator" means at any time an Originator,
where the Outstanding Balance of Receivables acquired from such Originator
pursuant to the Originator Purchase Agreement is less than 10% of the
Outstanding Balance of all Receivables at such time.
"Obligor" means a Person obligated to make payments pursuant
to a Contract.
"Origination Date" means (i) the date of this Agreement, with
respect to Receivables existing on such date and (ii) the date on which such
Receivable is created, with respect to all other Receivables.
"Originator" means each Person listed on Schedule IV hereto as
such Schedule shall be amended from time to time; provided that none of Illinois
Cement Company, Joint Venture, Paperboard or Texas Lehigh Cement Company, LP
shall be an Originator hereunder until (i) such Person is designated as such by
the Seller in a written notice to the Agent, (ii) the Agent shall have completed
its due diligence and obtained credit approval for such Person, (iii) the Agent
shall have received all agreements, documents and opinions as it may have
reasonably requested with respect to such Person (which shall be comparable to
the agreements, documents and opinions obtained by the Agent with respect to
each Originator pursuant to Section 3.01), and (iv) the Agent shall have
received a confirmation by each of S&P and Moody's similar to that obtained
pursuant to Section 3.01(m).
"Originator Purchase Agreement" means the Originator Purchase
Agreement dated as of the date of this Agreement among the Originators, as
sellers, and the Parent, as purchaser, as the same may be amended, modified or
restated from time to time.
"Originator Receivable" means the indebtedness of any Obligor
(other than an Obligor that does not meet the requirements of clause (i) of the
definition of "Eligible Receivable") resulting from the provision or sale of
merchandise or services by an Originator under a Contract, and includes the
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right to payment of any interest or finance charges and other obligations of
such Obligor with respect thereto.
"Other Companies" means the Parent, the Originators and all of
their respective Subsidiaries except the Seller.
"Outstanding Balance" of any Receivable or an Originator
Receivable, as the case may be, at any time means the then outstanding principal
balance thereof.
"Paperboard" means Republic Paperboard Company, LLC, a
Delaware limited liability company.
"Parent" means Centex Construction Products, Inc., a Delaware
corporation.
"Parent/Seller Purchase Agreement" means the Purchase and
Contribution Agreement dated as of the date of this Agreement between the
Parent, as seller, and the Seller, as purchaser, as the same may be amended,
modified or restated from time to time.
"Percentage" of any Bank means, (a) with respect to Credit
Lyonnais, the percentage set forth on the signature page to this Agreement, or
such amount as reduced by any Assignment and Acceptance entered into with an
Eligible Assignee, or (b) with respect to a Bank that has entered into an
Assignment and Acceptance, the amount set forth therein as such Bank's
Percentage, or such amount as reduced by an Assignment and Acceptance entered
into between such Bank and an Eligible Assignee.
"Person" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Pool Receivable" means a Receivable in the Receivables Pool.
"Purchase Limit" means $50,000,000, as such amount may be
reduced pursuant to Section 2.01(b). References to the unused portion of the
Purchase Limit shall mean, at any time, the Purchase Limit, as then reduced
pursuant to Section 2.01(b), minus the then outstanding Capital of Receivable
Interests under this Agreement.
"Purchase Price Note" has the meaning specified in the
Parent/Seller Purchase Agreement.
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"Receivable" means any Originator Receivable which has been
acquired by the Parent from an Originator pursuant to the Originator Purchase
Agreement and acquired by the Seller from the Parent by purchase or by capital
contribution pursuant to the Parent/Seller Purchase Agreement.
"Receivable Interest" means, at any time, an undivided
percentage ownership interest in (i) all then outstanding Pool Receivables
arising prior to the time of the most recent computation or recomputation of
such undivided percentage interest pursuant to Section 2.03, (ii) all Related
Security with respect to such Pool Receivables, and (iii) all Collections with
respect to, and other proceeds of, such Pool Receivables. Such undivided
percentage interest shall be computed as
C + YFR + LR + DR
-----------------
NRPB
where:
C = the Capital of such Receivable Interest at the time
of computation.
YFR = the Yield and Fee Reserve of such Receivable Interest
at the time of computation.
LR = the Loss Reserve of such Receivable Interest at the
time of computation.
DR = the Dilution Reserve of such Receivable Interest at
the time of computation.
NRPB = the Net Receivables Pool Balance at the time of
computation.
Each Receivable Interest shall be determined from time to time pursuant to the
provisions of Section 2.03.
"Receivables Pool" means at any time the aggregation of all
then outstanding Receivables.
"Related Security" means with respect to any Receivable
(i) all of the Seller's interest in any merchandise
(including returned merchandise) relating to any sale giving
rise to such Receivable;
(ii) all security interests or liens and property
subject thereto from time to time purporting to secure payment
of such Receivable, whether pursuant to the
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Contract related to such Receivable or otherwise, together
with all financing statements signed by an Obligor describing
any collateral securing such Receivable;
(iii) all guaranties, insurance and other agreements
or arrangements of whatever character from time to time
supporting or securing payment of such Receivable whether
pursuant to the Contract related to such Receivable or
otherwise; and
(iv) the Contract and all other books, records and
other information (including, without limitation, computer
programs, tapes, discs, punch cards, data processing software
and similar property and rights) relating to such Receivable
and the related Obligor.
"S&P" means Standard & Poor's Rating Services, a division of
XxXxxx-Xxxx Companies, Inc.
"SEC" means the Securities and Exchange Commission.
"Seller Report" means a report in substantially the form of
Annex A hereto and containing such additional information as the Agent may
reasonably request from time to time, furnished by the Collection Agent to the
Agent pursuant to Section 6.02(g).
"Settlement Date" for any Receivable Interest means the last
day of each Fixed Period for such Receivable Interest.
"Subsidiary" of a specified Person means any corporation or
other entity of which securities having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by such Person, or one or more of
such Person's Subsidiaries, or by such Person and one or more of such Person's
Subsidiaries.
"Tangible Net Worth" means at any time the excess of (i) the
sum of (a) the product of (x) 100% minus the Discount (as such term is defined
in the Parent/Seller Purchase Agreement) multiplied by (y) the Outstanding
Balance of all Receivables plus (b) cash and cash equivalents of the Seller plus
(c) the outstanding principal amount of Purchaser Loans (as such term is defined
in the Parent/Seller Purchase Agreement), minus (ii) the sum of (a) Capital plus
(b) the outstanding principal amount of the Purchase Price Note.
"Termination Date" for any Receivable Interest means (i) in
the case of a Receivable Interest owned by an Investor,
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the earlier of (a) the Business Day which the Seller or the Agent so designates
by notice to the other at least one Business Day in advance for such Receivable
Interest and (b) the Facility Termination Date and (ii) in the case of a
Receivable Interest owned by a Bank, the earlier of (a) the Business Day which
the Seller so designates by notice to the Agent at least one Business Day in
advance for such Receivable Interest and (b) the Commitment Termination Date.
"Transaction Document" means any of this Agreement, the
Originator Purchase Agreement, the Parent/Seller Purchase Agreement, the
Lock-Box Agreements, the Fee Agreement, the Administrative Services Agreement
and all other agreements and documents designated by the mutual agreement of the
parties hereto as "Transaction Documents" from time to time, and all amendments
and supplements hereto or thereto.
"UCC" means the Uniform Commercial Code as from time to time
in effect in the specified jurisdiction.
"Yield" means:
(i) for each Receivable Interest for any Fixed Period
to the extent Atlantic will be funding such Receivable
Interest through the issuance of commercial paper notes,
IR x C x ED + LF
---
360
(ii) for each Receivable Interest for any Fixed
Period to the extent (x) Atlantic will not be funding such
Receivable Interest through the issuance of commercial paper
notes, or (y) the Banks will be funding such Receivable
Interest,
AR x C x ED + LF
---
360
where:
AR = the Assignee Rate for such Receivable Interest for
such Fixed Period
C = the Capital of such Receivable Interest during such
Fixed Period
IR = the Investor Rate for such Receivable Interest for
such Fixed Period
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ED = the actual number of days elapsed during such Fixed
Period
LF = the Liquidation Fee, if any, for such Receivable
Interest for such Fixed Period
provided that no provision of this Agreement shall require the payment or permit
the collection of Yield in excess of the maximum permitted by applicable law;
and provided further that Yield for any Receivable Interest shall not be
considered paid by any distribution to the extent that at any time all or a
portion of such distribution is rescinded or must otherwise be returned for any
reason.
"Yield and Fee Reserve" means, for any Receivable Interest on
any date, an amount equal to
(C x YFRP) + AUYF
where:
C = the Capital of such Receivable Interest at the close
of business of the Collection Agent on such date.
YFRP = the Yield and Fee Reserve Percentage on such date.
AUYF = accrued and unpaid Yield, Collection Agent Fee and
Fees on such date, in each case for such Receivable
Interest.
"Yield and Fee Reserve Percentage" means, on any date, a
percentage equal to
(AER + CAF) x 2 x DSO
---------------------
360
where:
AER = the one-month Adjusted Eurodollar Rate in effect on
such date.
CAF = the percentage per annum used in the calculation of
the Collection Agent Fee in effect on such date.
DSO = the Days Sales Outstanding on such date.
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SECTION 1.02. Other Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles. 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.
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01. Purchase Facility. (a) On the terms and
conditions hereinafter set forth, Atlantic may, in its sole discretion, and the
Banks shall, ratably in accordance with their respective Bank Commitments,
purchase Receivable Interests from the Seller from time to time during the
period from the date hereof to the Facility Termination Date (in the case of
Atlantic) and to the Commitment Termination Date (in the case of the Banks).
Under no circumstances shall Atlantic make any such purchase, or the Banks be
obligated to make any such purchase, if after giving effect to such purchase the
aggregate outstanding Capital of Receivable Interests (after giving effect to
any reduction of Capital of Receivable Interests held by any Investor to be made
on the date of such purchase from the proceeds of any purchases by the Banks)
would exceed the Purchase Limit.
(b) The Seller may at any time, upon at least 30 days' notice
to the Agent, terminate the facility provided for in this Agreement in whole or,
from time to time, reduce in part the unused portion of the Purchase Limit;
provided that each partial reduction shall be in the amount of at least
$10,000,000 or an integral multiple of $1,000,000 in excess thereof; provided,
however, that one partial reduction in an amount less than $10,000,000 shall be
permitted in each calendar quarter.
(c) Until the Agent gives the Seller the notice provided in
Section 3.02(c)(iii), the Agent, on behalf of the Investors which own Receivable
Interests, shall have the Collections attributable to such Receivable Interests
automatically reinvested pursuant to Section 2.04 in additional undivided
percentage interests in the Pool Receivables by making an appropriate
readjustment of such Receivable Interests. The Agent, on behalf of the Banks
which own Receivable Interests, shall have the Collections attributable to such
Receivable Interests automatically reinvested pursuant to Section 2.04 in
additional undivided percentage interests in the Pool Receivables by making an
appropriate readjustment of such Receivable Interests.
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SECTION 2.02. Making Purchases. (a) Each purchase by Atlantic
or the Banks shall be made on at least three Business Days' notice from the
Seller to the Agent. Each such notice of a purchase shall specify (i) the amount
requested to be paid to the Seller (such amount, which shall not be less than
$1,000,000, being referred to herein as the initial "Capital" of the Receivable
Interest then being purchased), (ii) the date of such purchase (which shall be a
Business Day), and (iii) the requested duration of the initial Fixed Period for
such Receivable Interest. The Agent shall promptly thereafter notify the Seller
whether Atlantic has determined to make a purchase and, if so, whether all of
the terms specified by the Seller are acceptable to Atlantic.
If Atlantic has determined not to make a proposed purchase,
the Agent shall promptly send notice of the proposed purchase to all of the
Banks concurrently by telecopier, telex or cable specifying the date of such
purchase, each Bank's Percentage multiplied by the aggregate amount of Capital
of Receivable Interest being purchased, whether the Yield for the Fixed Period
for such Receivable Interest is calculated based on the Eurodollar Rate (which
may be selected by the Seller only if the notice referred to in the first
sentence of this Section is given at least three Business Days prior to the
purchase date) or the Alternate Base Rate, and the duration of the Fixed Period
for such Receivable Interest (which shall be one day if the Seller has not
selected another period).
(b) On the date of each such purchase of a Receivable
Interest, Atlantic or the Banks, as the case may be, shall, upon satisfaction of
the applicable conditions set forth in Article III, make available to the Seller
in same day funds an amount equal to the initial Capital of such Receivable
Interest, to the Seller's account no. 1013639238 at PNC Bank, 0xx xxx Xxxx
Xxxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, ABA No. 000000000 or such other account
of the Seller as the Seller may hereafter direct the Agent in writing; provided,
however, if such purchase is being made by the Banks following the designation
by the Agent of a Termination Date for a Receivable Interest owned by an
Investor pursuant to clause (i)(a) of the definition of Termination Date and any
Capital of such Receivable Interest is outstanding on such date of purchase, the
Seller hereby directs the Banks to pay the proceeds of such purchase (to the
extent of the outstanding Capital and accrued Yield on such Receivable Interest
of the Investor) to the Agent's Account, for application to the reduction of the
outstanding Capital and accrued Yield on such Receivable Interest of the
Investor.
(c) Effective on the date of each purchase pursuant to this
Section 2.02 and each reinvestment pursuant to Section 2.04,
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the Seller hereby sells and assigns to the Agent, for the benefit of the parties
making such purchase, an undivided percentage ownership interest, to the extent
of the Receivable Interest then being purchased, in each Pool Receivable then
existing and in the Related Security and Collections with respect thereto.
(d) Notwithstanding the foregoing, a Bank shall not be
obligated to make purchases under this Section 2.02 at any time in an amount
which would exceed such Bank's Bank Commitment less such Bank's ratable share of
the aggregate outstanding Capital held by Atlantic (whether or not any portion
thereof has been assigned by Atlantic pursuant to the Asset Purchase Agreement),
after giving effect to any reductions of the Capital held by Atlantic to be made
on the date of such purchase from the proceeds of purchases by the Banks. Each
Bank's obligation shall be several, such that the failure of any Bank to make
available to the Seller any funds in connection with any purchase shall not
relieve any other Bank of its obligation, if any, hereunder to make funds
available on the date of such purchase, but no Bank shall be responsible for the
failure of any other Bank to make funds available in connection with any
purchase.
SECTION 2.03. Receivable Interest Computation. Each Receivable
Interest shall be initially computed on its date of purchase. Thereafter until
the Termination Date for such Receivable Interest, such Receivable Interest
shall be automatically recomputed (or deemed to be recomputed) on each day other
than a Liquidation Day. Any Receivable Interest, as computed (or deemed
recomputed) as of the day immediately preceding the Termination Date for such
Receivable Interest, shall thereafter remain constant. Such Receivable Interest
shall become zero when Capital thereof and Yield thereon shall have been paid in
full, and all Fees and other amounts owed by the Seller hereunder to the
Investors, the Banks or the Agent are paid and the Collection Agent shall have
received the accrued Collection Agent Fee thereon.
SECTION 2.04. Settlement Procedures. (a) Collection of the
Pool Receivables shall be administered by a Collection Agent, in accordance with
the terms of Article VI of this Agreement. The Seller shall provide to the
Collection Agent (if other than the Seller) on a timely basis all information
needed for such administration, including notice of the occurrence of any
Liquidation Day.
(b) The Collection Agent shall, on each day on which
Collections of Pool Receivables are received by it:
(i) with respect to each Receivable Interest, set
aside and hold in trust (and, at the request of the
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Agent, segregate) for the Investors or the Banks that hold
such Receivable Interest, out of the percentage of such
Collections represented by such Receivable Interest, an amount
equal to the Yield, Fees and Collection Agent Fee accrued
through such day for such Receivable Interest and not
previously set aside;
(ii) with respect to each Receivable Interest, if
such day is not a Liquidation Day for such Receivable
Interest, reinvest with the Seller on behalf of the Investors
or the Banks that hold such Receivable Interest the percentage
of such Collections represented by such Receivable Interest,
to the extent representing a return of Capital, by
recomputation of such Receivable Interest pursuant to Section
2.03;
(iii) if such day is a Liquidation Day for any one or
more Receivable Interests, set aside and hold in trust (and,
at the request of the Agent, segregate) for the Investors or
the Banks that hold such Receivable Interests (x) if such day
is a Liquidation Day for less than all of the Receivable
Interests, the percentage of such Collections represented by
such Receivable Interests, and (y) if such day is a
Liquidation Day for all of the Receivable Interests, all of
the remaining Collections (but not in excess of the Capital of
such Receivable Interests); provided that if amounts are set
aside and held in trust on any Liquidation Day occurring prior
to the Termination Date, and thereafter prior to the
Settlement Date for such Fixed Period the conditions set forth
in Section 3.02 are satisfied or waived by the Agent, such
previously set aside amounts shall, to the extent representing
a return of Capital, be reinvested in accordance with the
preceding subsection (ii) on the day of such subsequent
satisfaction or waiver of conditions; and
(iv) release to the Seller for its own account any
remaining Collections.
(c) The Collection Agent shall deposit into the Agent's
Account, on the Settlement Date for each Receivable Interest, Collections held
for the Investors or the Banks that relate to such Receivable Interest pursuant
to Section 2.04(b).
(d) Upon receipt of funds deposited into the Agent's Account,
the Agent shall distribute them as follows:
(i) if such distribution occurs on a day that is
not a Liquidation Day, first to the Investors or the
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Banks that hold the relevant Receivable Interest and to the
Agent in payment in full of all accrued Yield and Fees and
then to the Collection Agent in payment in full of all accrued
Collection Agent Fee.
(ii) if such distribution occurs on a Liquidation
Day, first to the Investors or the Banks that hold the
relevant Receivable Interest and to the Agent in payment in
full of all accrued Yield and Fees, second to such Investors
or Banks in reduction to zero of all Capital, third to such
Investors, Banks or the Agent in payment of any other amounts
owed by the Seller hereunder, and fourth to the Collection
Agent in payment in full of all accrued Collection Agent Fee.
After the Capital, Yield, Fees and Collection Agent Fee with
respect to a Receivable Interest, and any other amounts payable by the Seller to
the Investors, the Banks or the Agent hereunder, have been paid in full, all
additional Collections with respect to such Receivable Interest shall be paid to
the Seller for its own account.
(e) For the purposes of this Section 2.04:
(i) if on any day any Pool Receivable becomes (in
whole or in part) a Diluted Receivable, the Seller shall be
deemed to have received on such day a Collection of such Pool
Receivable in the amount of such Diluted Receivable;
(ii) if on any day any of the representations or
warranties contained in Section 4.01(h) is no longer true with
respect to any Pool Receivable, the Seller shall be deemed to
have received on such day a Collection of such Pool Receivable
in full;
(iii) except as provided in subsection (i) or (ii) of
this Section 2.04(e), or as otherwise required by applicable
law or the relevant Contract, all Collections received from an
Obligor of any Receivables shall be applied to the Receivables
of such Obligor in the order of the age of such Receivables,
starting with the oldest such Receivable, unless such Obligor
designates its payment for application to specific
Receivables; and
(iv) if and to the extent the Agent, the Investors
or the Banks shall be required for any reason to pay over to
an Obligor any amount received on its behalf hereunder, such
amount shall be deemed not to have been
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so received but rather to have been retained by the Seller
and, accordingly, the Agent, the Investors or the Banks, as
the case may be, shall have a claim against the Seller for
such amount, payable when and to the extent that any
distribution from or on behalf of such Obligor is made in
respect thereof.
SECTION 2.05. Fees. (a) Each Investor and Bank shall pay to
the Collection Agent a fee (the "Collection Agent Fee") of 1% per annum on the
average daily Capital of each Receivable Interest owned by such Investor or
Bank, from the date of purchase of such Receivable Interest until the later of
the Termination Date for such Receivable Interest or the date on which such
Capital is reduced to zero, payable on the Settlement Date for such Receivable
Interest. Upon three Business Days' notice to the Agent, the Collection Agent
(if not the Parent, the Seller or its designee or an Affiliate of the Seller)
may elect to be paid, as such fee, another percentage per annum on the average
daily Capital of such Receivable Interest, but in no event in excess for all
Receivable Interests relating to the Receivables Pool of 110% of the reasonable
costs and expenses of the Collection Agent in administering and collecting the
Receivables in the Receivables Pool. The Collection Agent Fee shall be payable
only from Collections pursuant to, and subject to the priority of payment set
forth in, Section 2.04.
(b) The Seller shall pay to the Agent certain fees
(collectively, the "Fees") in the amounts and on the dates set forth in a
separate fee agreement of even date between the Seller and the Agent, as the
same may be amended or restated from time to time (the "Fee Agreement").
SECTION 2.06. Payments and Computations, Etc. (a) All amounts
to be paid or deposited by the Seller or the Collection Agent hereunder shall be
paid or deposited no later than 12:00 noon (New York City time) on the day when
due in same day funds to the Agent's Account.
(b) Each of the Seller and the Collection Agent shall, to the
extent permitted by law, pay interest on any amount not paid or deposited by it
when due hereunder, at an interest rate per annum equal to 2% per annum above
the Alternate Base Rate, payable on demand.
(c) All computations of interest under subsection (b) above
and all computations of Yield, fees, and other amounts 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. Whenever any payment or deposit to be
made hereunder shall be due on a day other than a Business Day, such
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payment or deposit shall be made on the next succeeding Business Day and such
extension of time shall be included in the computation of such payment or
deposit.
SECTION 2.07. Dividing or Combining Receivable Interests.
Either the Seller or the Agent may, upon notice to the other party received at
least three Business Days prior to the last day of any Fixed Period in the case
of the Seller giving notice, or up to the last day of such Fixed Period in the
case of the Agent giving notice, either (i) divide any Receivable Interest into
two or more Receivable Interests having aggregate Capital equal to the Capital
of such divided Receivable Interest, or (ii) combine any two or more Receivable
Interests originating on such last day or having Fixed Periods ending on such
last day into a single Receivable Interest having Capital equal to the aggregate
of the Capital of such Receivable Interests; provided, however, that no
Receivable Interest owned by Atlantic may be combined with a Receivable Interest
owned by any Bank.
SECTION 2.08. Increased Costs. (a) If Credit Lyonnais, any
Investor, any Bank, any entity which enters into a commitment to purchase
Receivable Interests or interests therein, or any of their respective Affiliates
(each an "Affected Person") determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or would
affect the amount of the capital required or expected to be maintained by such
Affected Person and such Affected Person determines that the amount of such
capital is increased by or based upon the existence of any commitment to make
purchases of or otherwise to maintain the investment in Pool Receivables or
interests therein related to this Agreement or to the funding thereof and other
commitments of the same type, then, upon demand by such Affected Person (with a
copy to the Agent), the Seller shall immediately pay to the Agent for the
account of such Affected Person (as a third-party beneficiary), from time to
time as specified by such Affected Person, additional amounts sufficient to
compensate such Affected Person in the light of such circumstances, to the
extent that such Affected Person reasonably determines such increase in capital
to be allocable to the existence of any of such commitments. A certificate as to
such amounts (which shall include calculations in reasonable detail) submitted
to the Seller and the Agent by such Affected Person shall be conclusive and
binding for all purposes, absent manifest error.
(b) If, due to either (i) the introduction of or any change
(other than any change by way of imposition or increase of reserve requirements
referred to in Section 2.09) in or in the interpretation of any law or
regulation or (ii) compliance with
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any guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
cost to any Investor or Bank of agreeing to purchase or purchasing, or
maintaining the ownership of, Receivable Interests in respect of which Yield is
computed by reference to the Eurodollar Rate, then, upon demand by such Investor
or Bank (with a copy to the Agent), the Seller shall immediately pay to the
Agent, for the account of such Investor or Bank (as a third-party beneficiary),
from time to time as specified by such Investor or Bank, additional amounts
sufficient to compensate such Investor or Bank for such increased costs. A
certificate as to such amounts (which shall include calculations in reasonable
detail) submitted to the Seller and the Agent by such Investor or Bank shall be
conclusive and binding for all purposes, absent manifest error.
SECTION 2.09. Additional Yield on Receivable Interests Bearing
a Eurodollar Rate. The Seller shall pay to any Investor or Bank, so long as such
Investor or Bank shall be required under regulations of the Board of Governors
of the Federal Reserve System to maintain reserves with respect to liabilities
or assets consisting of or including Eurocurrency Liabilities, additional Yield
on the unpaid Capital of each Receivable Interest of such Investor or Bank
during each Fixed Period in respect of which Yield is computed by reference to
the Eurodollar Rate, for such Fixed Period, at a rate per annum equal at all
times during such Fixed Period to the remainder obtained by subtracting (i) the
Eurodollar Rate for such Fixed Period from (ii) the rate obtained by dividing
such Eurodollar Rate referred to in clause (i) above by that percentage equal to
100% minus the Eurodollar Rate Reserve Percentage of such Investor or Bank for
such Fixed Period, payable on each date on which Yield is payable on such
Receivable Interest. Such additional Yield shall be determined by such Investor
or Bank and notice thereof given to the Seller through the Agent within 30 days
after any Yield payment is made with respect to which such additional Yield is
requested. A certificate as to such additional Yield (which shall include
calculations in reasonable detail) submitted to the Seller and the Agent by such
Investor or Bank shall be conclusive and binding for all purposes, absent
manifest error.
SECTION 2.10. Taxes. (a) Any and all payments and deposits
required to be made hereunder or under any other Transaction Document by the
Collection Agent or the Seller shall be made free and clear of and without
deduction for any and all present or future taxes, levies, imposts, deductions,
charges or withholdings, and all liabilities with respect thereto, excluding net
income taxes that are imposed by the United States and franchise taxes and net
income taxes that are imposed on an Affected Person by the state or foreign
jurisdiction under the
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laws of which such Affected Person is organized or any political subdivision
thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities being hereinafter referred to as "Taxes"). If the
Seller or the Collection Agent shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder to any Affected Person, (i) the
Seller shall make an additional payment to such Affected Person, in an amount
sufficient so that, after making all required deductions (including deductions
applicable to additional sums payable under this Section 2.10), such Affected
Person receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Seller or the Collection Agent, as the case may
be, shall make such deductions and (iii) the Seller or the Collection Agent, as
the case may be, shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.
(b) In addition, the Seller agrees to pay any present or
future stamp or other documentary taxes or any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or under
any other Transaction Document or from the execution, delivery or registration
of, or otherwise with respect to, this Agreement or any other Transaction
Document (hereinafter referred to as "Other Taxes").
(c) The Seller will indemnify each Affected Party for the full
amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section
2.10) paid by such Affected Person and any liability (including penalties,
interest and expenses) arising therefrom or with respect thereto whether or not
such Taxes or Other Taxes were correctly or legally asserted. This
indemnification shall be made within thirty days from the date the Affected
Person makes written demand therefor (and a copy of such demand shall be
delivered to the Agent). A certificate as to the amount of such indemnification
submitted to the Seller and the Agent by such Affected Person, setting forth, in
reasonable detail, the basis for and the calculation thereof, shall be
conclusive and binding for all purposes absent manifest error.
SECTION 2.11. Security Interest. As collateral security for
the performance by the Seller of all the terms, covenants and agreements on the
part of the Seller (whether as Seller or otherwise) to be performed under this
Agreement or any document delivered in connection with this Agreement in
accordance with the terms thereof, including the punctual payment when due of
all obligations of the Seller hereunder or thereunder, whether for
indemnification payments, fees, expenses or otherwise, the Seller hereby assigns
to the Agent for its benefit and the ratable benefit of the Investors and the
Banks, and hereby grants to the Agent for its
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benefit and the ratable benefit of the Investors and the Banks, a security
interest in, all of the Seller's right, title and interest in and to (A) the
Parent/Seller Purchase Agreement and the Originator Purchase Agreement,
including, without limitation, (i) all rights of the Seller to receive moneys
due or to become due under or pursuant to the Parent/Seller Purchase Agreement
or the Originator Purchase Agreement, (ii) all security interests and property
subject thereto from time to time purporting to secure payment of monies due or
to become due under or pursuant to the Parent/Seller Purchase Agreement or the
Originator Purchase Agreement, (iii) all rights of the Seller to receive
proceeds of any insurance, indemnity, warranty or guaranty with respect to the
Parent/Seller Purchase Agreement or the Originator Purchase Agreement, (iv)
claims of the Seller for damages arising out of or for breach of or default
under the Parent/Seller Purchase Agreement or the Originator Purchase Agreement,
and (v) the right of the Seller to compel performance and otherwise exercise all
remedies thereunder,(B) all Receivables, whether now owned and existing or
hereafter acquired or arising, the Related Security with respect thereto and the
Collections and all other assets, including, without limitation, accounts,
chattel paper, instruments and general intangibles (as those terms are defined
in the UCC), including undivided interests in any of the foregoing, owned by the
Seller and not otherwise purchased under this Agreement, and (C) to the extent
not included in the foregoing, all proceeds of any and all of the foregoing.
SECTION 2.12. Repurchase Option. So long as no Event of
Termination or Incipient Event of Termination would occur or be continuing after
giving effect thereto, the Seller shall have the right (the "Call Right") to
repurchase all, but not less than all, of the Receivable Interests held by the
Investors and the Banks upon not less than thirty Business Days' prior written
notice to the Agent. Such notice shall specify the date that the Seller desires
that such repurchase occur (such date, the "Repurchase Date"). On the Repurchase
Date, the Seller shall transfer to the Agent's Account in immediately available
funds an amount equal to (i) the Capital of the Receivable Interests held by the
Investors and the Banks, (ii) all accrued and unpaid Yield thereon to the
Repurchase Date, (iii) all accrued and unpaid Fees owing to the Investors and
the Banks, (iv) the Liquidation Fee owing to the Investors and the Banks in
respect of such repurchase and (v) all expenses and other amounts payable
hereunder to any of the Agent, the Investors and the Banks (including, without
limitation, attorneys' fees and disbursements). Any repurchase pursuant to this
Section 2.12 shall be made without recourse to or warranty by the Agent, the
Investors or the Banks. Further, on the Repurchase Date the Bank
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Commitments for all the Banks shall terminate, each of the Commitment
Termination Date and Facility Termination Date shall have occurred, the
Termination Date for all Banks and the Investors shall have occurred and no
further purchases or reinvestments of Collections shall be made hereunder.
ARTICLE III
CONDITIONS OF PURCHASES
SECTION 3.01. Conditions Precedent to Initial Purchase. The
initial purchase of a Receivable Interest under this Agreement is subject to the
conditions precedent that the Agent shall have received on or before the date of
such purchase the following, each (unless otherwise indicated) dated as of such
date of purchase, in form and substance satisfactory to the Agent:
(a) Certified copies of the resolutions (or similar
authorization, if not a corporation) of the Board of Directors (or similar
governing body or Persons, if not a corporation) of the Seller and the Parent
approving this Agreement and the Parent/Seller Purchase Agreement and certified
copies of all documents evidencing other necessary corporate action or limited
liability company action, as the case may be, and governmental approvals, if
any, with respect to this Agreement and the Parent/Seller Purchase Agreement.
(b) A certificate of the Secretary or Assistant Secretary of
the Seller and of the Parent certifying the names and true signatures of the
officers of the Seller and of the Parent authorized to sign the Parent/Seller
Purchase Agreement and this Agreement and the other documents to be delivered by
it hereunder and thereunder.
(c) Acknowledgment copies or time stamped receipt copies of
proper financing statements, duly filed on or before the date of such initial
purchase under the UCC of all jurisdictions that the Agent may deem necessary or
desirable in order to perfect the ownership and security interests contemplated
by this Agreement, the Parent/Seller Purchase Agreement and the Originator
Purchase Agreement.
(d) Acknowledgment copies or time stamped receipt copies of
proper financing statements, if any, necessary to release all security interests
and other rights of any Person (other than the interests evidenced by the
financing statement filings referred to in the second sentence of Section
4.01(h)) in (i) the Receivables, Contracts or Related Security previously
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granted by the Seller, the Parent or any Originator and (ii) the collateral
security referred to in Section 2.11 previously granted by the Seller.
(e) Completed requests for information, dated on or before the
date of such initial purchase, listing all effective financing statements filed
in the jurisdictions referred to in subsection (c) above that name the Seller,
the Parent or any Originator as debtor, together with copies of such financing
statements (none of which shall cover any Receivables, Contracts, Related
Security or the collateral security referred to in Section 2.11).
(f) Executed copies of Lock-Box Agreements with each Lock-Box
Bank.
(g) A favorable opinion of (i) Xxxxxxx & Xxxxx, L.L.P.,
counsel for the Seller and the Parent, (ii) in house counsel to the Seller, the
Parent and the Originators and (iii) Delaware counsel to the Seller,
substantially in the forms of Annex C hereto and as to such other matters as the
Agent may reasonably request.
(h) The Fee Agreement.
(i) An executed copy of the Parent/Seller Purchase Agreement
and the Originator Purchase Agreement.
(j) A copy of the limited liability company agreement of the
Seller, certified by the Parent, as member of the Seller, and of the by-laws of
the Parent, certified by the Secretary or Assistant Secretary of the Parent.
(k) A copy of the certificate of formation of the Seller and
of the certificate of incorporation of the Parent, certified as of a recent date
by the Secretary of State or other appropriate official of the state of its
organization, and a certificate as to the good standing of each of the Seller
and the Parent from such Secretary of State or other official, dated as of a
recent date.
(l) The opening pro forma balance sheet of the Seller referred
to in Section 4.01(e).
(m) Confirmation (informally but to the reasonable
satisfaction of the Agent) by each of S&P and Xxxxx'x that the commercial paper
notes of Atlantic issued in connection with this Agreement will be, or will
continue to be, rated at least A-1 and P-1, respectively.
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(n) Certified copies of the resolutions (or similar
authorization, if not a corporation) of the Board of Directors (or similar
governing body or Persons, if not a corporation) of the Parent and the
Originators approving the Originator Purchase Agreement and certified copies of
all documents evidencing other necessary corporate, partnership or limited
liability company action, as the case may be, and governmental approvals, if
any, with respect to the Originator Purchase Agreement.
(o) A certificate of a Secretary or Assistant Secretary (or,
in the case of the Originators, other equivalent office) of the Parent and the
Originators certifying the names and true signatures of the officers of the
Parent and the Originators authorized to sign the Originator Purchase Agreement
and the other documents to be delivered by it thereunder.
(p) A copy of the limited liability company agreement, by-laws
or other governance document of each of the Originators, certified by the
respective Secretary or Assistant Secretary or manager thereof.
(q) A copy of the certificate of formation or certificate or
articles of incorporation or other governance document of each of the
Originators, certified as of a recent date by the Secretary of State or other
appropriate official of the state of its organization, and a certificate as to
the good standing of each of the Originators from such Secretary of State or
other official, dated as of a recent date.
SECTION 3.02. Conditions Precedent to All Purchases and
Reinvestments. Each purchase (including the initial purchase) and each
reinvestment shall be subject to the further conditions precedent that (a) in
the case of each purchase, the Collection Agent shall have delivered to the
Agent at least one Business Day prior to such purchase, in form and substance
reasonably satisfactory to the Agent, a completed Seller Report (or, in the case
of the initial purchase, a pro forma Seller Report for the period ending May 31,
2001) containing information covering the most recently ended reporting period
for which information is required pursuant to Section 6.02(g) and demonstrating
that after giving effect to such purchase no Event of Termination or Incipient
Event of Termination under Section 7.01(i) would occur, (b) in the case of each
reinvestment, the Collection Agent shall have delivered to the Agent on or prior
to the date of such reinvestment, in form and substance reasonably satisfactory
to the Agent, a completed Seller Report containing information covering the most
recently ended reporting period for which information is required pursuant to
Section 6.02(g), (c) on the date of such purchase or reinvestment the following
statements shall be true, except that
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the statement in clause (iii) below is required to be true only if such purchase
or reinvestment is by an Investor (and acceptance of the proceeds of such
purchase or reinvestment shall be deemed a representation and warranty by the
Seller and the Collection Agent (each as to itself) that such statements are
then true):
(i) The representations and warranties contained in
Section 4.01 (in the case of the Seller) and 4.02 (in the case
of the Collection Agent) are correct on and as of the date of
such purchase or reinvestment as though made on and as of such
date,
(ii) No event has occurred and is continuing, or
would result from such purchase or reinvestment, that
constitutes an Event of Termination or an Incipient Event of
Termination,
(iii) The Agent shall not have given the Seller at
least one Business Day's notice that the Investors have
terminated the reinvestment of Collections attributable to
their Receivable Interests in Receivable Interests, and
(iv) The Originators shall have sold to the Parent,
pursuant to the Originator Purchase Agreement, and the Parent
shall have sold or contributed to the Seller, pursuant to the
Parent/Seller Purchase Agreement, all Originator Receivables
outstanding on the date the applicable Originator first became
an Originator hereunder and thereafter arising through and
including such purchase or reinvestment date, and
(d) the Agent shall have received such other approvals, opinions or documents as
it may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Seller.
The Seller hereby represents and warrants as follows:
(a) The Seller is a limited liability company duly formed,
validly existing and in good standing under the laws of Delaware, and is duly
qualified to do business, and is in good standing, in every jurisdiction where
the nature of its business requires it to be so qualified.
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(b) The execution, delivery and performance by the Seller of
the Transaction Documents to which it is a party and the other documents to be
delivered by it hereunder, including the Seller's use of the proceeds of
purchases and reinvestments, (i) are within the Seller's limited liability
company powers, (ii) have been duly authorized by all necessary limited
liability company action, (iii) do not contravene (1) the Seller's certificate
of formation or limited liability company agreement, (2) any law, rule or
regulation applicable to the Seller, (3) any contractual restriction binding on
or affecting the Seller or its property or (4) any order, writ, judgment, award,
injunction or decree binding on or affecting the Seller or its property, and
(iv) do not result in or require the creation of any lien, security interest or
other charge or encumbrance upon or with respect to any of its properties
(except for the interest created pursuant to this Agreement). Each of the
Transaction Documents to which the Seller is a party has been duly executed and
delivered by the Seller.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by the Seller of the
Transaction Documents to which the Seller is a party or any other document to be
delivered thereunder, except for the filing of UCC financing statements which
are referred to therein.
(d) Each of the Transaction Documents to which the Seller is a
party constitutes the legal, valid and binding obligation of the Seller
enforceable against the Seller in accordance with its terms, subject to
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally and to general principles of equity (whether considered in a
proceeding in equity or at law).
(e) The opening pro forma balance sheet of the Seller as at
June 29, 2001, giving effect to the initial purchase to be made under this
Agreement, a copy of which has been furnished to the Agent, fairly presents the
financial condition of the Seller as at such date, in accordance with generally
accepted accounting principles, and since May 1, 2001 there has been no material
adverse change in the business, operations, property or financial or other
condition of the Seller.
(f) There is no pending or, to the knowledge of the Seller,
threatened action or proceeding against the Seller before any court,
governmental agency or arbitrator which may materially adversely affect the
financial condition or operations of the Seller or the ability of the Seller to
perform its obligations under the Transaction Documents, or which purports to
affect the legality, validity or enforceability of the Transaction Documents.
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(g) No proceeds of any purchase or reinvestment will be used
to acquire any equity security of a class which is registered pursuant to
Section 12 of the Securities Exchange Act of 1934.
(h) Immediately prior to the purchase by the Investor or the
Banks, as the case may be, the Seller is the legal and beneficial owner of the
Pool Receivables and Related Security free and clear of any Adverse Claim; upon
each purchase or reinvestment, the Investors or the Banks, as the case may be,
shall acquire a valid and perfected first priority undivided percentage
ownership interest to the extent of the pertinent Receivable Interest in each
Pool Receivable then existing or thereafter arising and in the Related Security
and Collections with respect thereto. No effective financing statement or other
instrument similar in effect covering any Contract or any Pool Receivable or the
Related Security or Collections with respect thereto is on file in any recording
office, except those filed in favor of the Agent relating to this Agreement and
those filed against the Parent pursuant to the Parent/Seller Purchase Agreement
or against the Originators pursuant to the Originator Purchase Agreement.
(i) Each Seller Report (if prepared by the Seller or one of
its Affiliates, or to the extent that information contained therein is supplied
by the Seller or an Affiliate), information, exhibit, financial statement,
document, book, record or report furnished or to be furnished at any time by or
on behalf of the Seller to the Agent, the Investors or the Banks in connection
with this Agreement is or will be accurate in all material respects as of its
date or (except as otherwise disclosed to the Agent, Investors or the Banks, as
the case may be, at such time) as of the date so furnished, and no such document
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary in order to make the statements
contained therein, in the light of the circumstances under which they were made,
not misleading.
(j) The principal place of business and chief executive office
of the Seller and the office where the Seller keeps its records concerning the
Pool Receivables are located at the address or addresses referred to in Section
5.01(b).
(k) The names and addresses of all the Lock-Box Banks,
together with the account numbers of the Lock-Box Accounts of the Seller at such
Lock-Box Banks, are as specified in Schedule I
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hereto, as such Schedule I may be updated from time to time pursuant to Section
5.01(g).
(l) The Seller is not known by and does not use any tradename
or doing-business-as name.
(m) The Seller was formed on May 1, 2001, and the Seller did
not engage in any business activities prior to the date of this Agreement. The
Seller has no Subsidiaries.
(n) (i) The fair value of the property of the Seller is
greater than the total amount of liabilities, including contingent liabilities,
of the Seller, (ii) the present fair salable value of the assets of the Seller
is not less than the amount that will be required to pay all probable
liabilities of the Seller on its debts as they become absolute and matured,
(iii) the Seller does not intend to, and does not believe that it will, incur
debts or liabilities beyond the Seller's abilities to pay such debts and
liabilities as they mature and (iv) the Seller is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction, for
which the Seller's property would constitute unreasonably small capital.
(o) With respect to each Pool Receivable, the Seller (i) shall
have received such Pool Receivable as a contribution to the capital of the
Seller by the Parent or (ii) shall have purchased such Pool Receivable from the
Parent in exchange for payment (made by the Seller to the Parent in accordance
with the provisions of the Parent/Seller Purchase Agreement) of cash, an
increase in the principal balance of the Purchase Price Note, or a combination
thereof in an amount which constitutes fair consideration and reasonably
equivalent value. Each such sale referred to in clause (ii) of the preceding
sentence shall not have been made for or on account of an antecedent debt owed
by the Parent to the Seller and no such sale is or may be voidable or subject to
avoidance under any section of the Federal Bankruptcy Code.
(p) The Outstanding Balance at any time of Originator
Receivables the Contracts in respect of which permit the payment of the amount
due thereunder more than 40 days from the original respective billing dates
therefor does not exceed 60% of the Outstanding Balance at such time of all
Originator Receivables.
SECTION 4.02. Representations and Warranties of the Collection
Agent. The Collection Agent hereby represents and warrants as follows:
(a) The Collection Agent is a corporation duly incorporated,
validly existing and in good standing under the
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laws of the State of Delaware, and is duly qualified to do business, and is in
good standing, in every jurisdiction where the nature of its business requires
it to be so qualified.
(b) The execution, delivery and performance by the Collection
Agent of this Agreement and any other documents to be delivered by it hereunder
(i) are within the Collection Agent's corporate powers, (ii) have been duly
authorized by all necessary corporate action, (iii) do not contravene (1) the
Collection Agent's charter or by-laws, (2) any law, rule or regulation
applicable to the Collection Agent, (3) any contractual restriction binding on
or affecting the Collection Agent or its property or (4) any order, writ,
judgment, award, injunction or decree binding on or affecting the Collection
Agent or its property, and (iv) do not result in or require the creation of any
lien, security interest or other charge or encumbrance upon or with respect to
any of its properties. This Agreement has been duly executed and delivered by
the Collection Agent.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by the Collection Agent
of this Agreement or any other document to be delivered by it hereunder.
(d) This Agreement constitutes the legal, valid and binding
obligation of the Collection Agent enforceable against the Collection Agent in
accordance with its terms, subject to bankruptcy, insolvency or other similar
laws affecting creditors' rights generally and to general principles of equity
(whether considered in a proceeding in equity or at law).
(e) The consolidated balance sheet of the Collection Agent and
its consolidated Subsidiaries as at March 31, 2001, and the related consolidated
statements of income and retained earnings of the Collection Agent and its
consolidated Subsidiaries for the fiscal year then ended, copies of which have
been furnished to the Agent, fairly present the financial condition of the
Collection Agent and its consolidated Subsidiaries as at such date and the
results of the operations of the Collection Agent and its consolidated
Subsidiaries for the period ended on such date, all in accordance with generally
accepted accounting principles consistently applied, and since March 31, 2001
there has been no material adverse change in the business, operations, property
or financial condition of the Collection Agent and its consolidated Subsidiaries
taken as a whole.
(f) There is no pending or, to the knowledge of the Collection
Agent, threatened action or proceeding against the
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Collection Agent or any of its Subsidiaries before any court, governmental
agency or arbitrator which may materially adversely affect the financial
condition or operations of the Collection Agent and its consolidated
Subsidiaries taken as a whole or the ability of the Collection Agent to perform
its obligations under this Agreement, or which purports to affect the legality,
validity or enforceability of this Agreement.
(g) On the date of each purchase and reinvestment, the sum of
the Receivable Interests is not greater than 100%.
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Seller. Until the latest of the
Facility Termination Date or the date on which no Capital of or Yield on any
Receivable Interest shall be outstanding or the date all other amounts owed by
the Seller hereunder to the Investors, the Banks or the Agent are paid in full:
(a) Compliance with Laws, Etc. The Seller will comply in all
material respects with all applicable laws, rules, regulations and orders and
preserve and maintain its limited liability company existence, rights,
franchises, qualifications, and privileges except to the extent that the failure
so to comply with such laws, rules and regulations or the failure so to preserve
and maintain such rights, franchises, qualifications, and privileges would not
materially adversely affect the collectibility of the Receivables Pool or the
ability of the Seller to perform its obligations under the Transaction
Documents.
(b) Offices, Records and Books of Account. The Seller will
keep its principal place of business and chief executive office and the office
where it keeps its records concerning the Pool Receivables at the address of the
Seller set forth under its name on the signature pages to this Agreement or,
upon 30 days' prior written notice to the Agent, at any other locations in
jurisdictions where all actions reasonably requested by the Agent to protect and
perfect the interest in the Pool Receivables have been taken and completed. The
Seller will not change its state of formation from that of the State of
Delaware. The Seller also will maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing Pool Receivables and related Contracts in the event of the
destruction of the originals thereof), and keep and maintain all documents,
books, records and other information
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reasonably necessary or advisable for the collection of all Pool Receivables
(including, without limitation, records adequate to permit the daily
identification of each Pool Receivable and all Collections of and adjustments to
each existing Pool Receivable).
(c) Performance and Compliance with Contracts and Credit and
Collection Policy. The Seller will, at its expense, timely and fully perform and
comply with all material provisions, covenants and other promises required to be
observed by it under the Contracts related to the Pool Receivables, and timely
and fully comply in all material respects with the applicable Credit and
Collection Policy in regard to each Pool Receivable and the related Contract.
(d) Sales, Liens, Etc. The Seller will not 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, the Seller's undivided interest
in any Pool Receivable, Related Security, related Contract or Collections, or
upon or with respect to any account to which any Collections of any Pool
Receivable are sent, or assign any right to receive income in respect thereof,
other than as contemplated by the Transaction Documents.
(e) Extension or Amendment of Receivables. Except as provided
in Section 6.02(c), the Seller will not (and will not permit the Collection
Agent, the Parent or any Originator to) extend, amend or otherwise modify the
terms of any Pool Receivable, or amend, modify or waive any term or condition of
any Contract related thereto.
(f) Change in Business or Credit and Collection Policy. The
Seller will not make any change in the character of its business or in the
applicable Credit and Collection Policy that would, in either case, materially
adversely affect the collectibility of the Receivables Pool or the ability of
the Seller to perform its obligations under this Agreement.
(g) Change in Payment Instructions to Obligors. The Seller
will not add or terminate any bank as a Lock-Box Bank from those listed in
Schedule I to this Agreement, or make any change in its instructions to Obligors
regarding payments to be made to the Seller or payments to be made to any
Lock-Box Bank, unless the Agent shall have received notice of such addition,
termination or change (including an updated Schedule I) and a fully executed
Lock-Box Agreement with each new Lock-Box Bank.
(h) Deposits to Lock-Box Accounts. The Seller will instruct or
cause the Collection Agent to instruct all Obligors to remit all their payments
in respect of Receivables to Lock-Box
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Accounts. If the Seller shall receive any Collections directly, it shall
immediately (and in any event within two Business Days) deposit the same to a
Lock-Box Account. The Seller will not deposit or otherwise credit, or cause or
permit to be so deposited or credited, to any Lock-Box Account cash or cash
proceeds other than Collections of Receivables.
(i) Marking of Records. At its expense, the Seller will cause
the master data processing records evidencing Pool Receivables to be marked to
indicate that Receivable Interests related to such Pool Receivables have been
sold in accordance with this Agreement.
(j) Further Assurances. (i) The Seller agrees from time to
time, at its expense, upon the request of the Agent, promptly to execute and
deliver all further instruments and documents, and to take all further actions,
that may be reasonably necessary or desirable, or that the Agent may reasonably
request, to perfect, protect or more fully evidence the Receivable Interests
purchased under this Agreement, or to enable the Investors, the Banks or the
Agent to exercise and enforce their respective rights and remedies under this
Agreement. Without limiting the foregoing, the Seller will, upon the request of
the Agent, execute and file such financing or continuation statements, or
amendments thereto, and such other instruments and documents, that may be
reasonably necessary or desirable, or that the Agent may reasonably request, to
perfect, protect or evidence such Receivable Interests.
(ii) The Seller authorizes the Agent to file
financing or continuation statements, and amendments thereto
and assignments thereof, relating to the Pool Receivables and
the Related Security, the related Contracts and the
Collections with respect thereto without the signature of the
Seller where permitted by law. A photocopy or other
reproduction of this Agreement shall be sufficient as a
financing statement where permitted by law.
(k) Reporting Requirements. The Seller will provide to the
Agent (in multiple copies, if requested by the Agent) the following:
(i) as soon as available and in any event within 60
days after the end of the first three quarters of each fiscal
year of the Parent and Centex, a consolidated balance sheet of
the Parent and its consolidated Subsidiaries and of Centex and
its consolidated Subsidiaries as of the end of such quarter
and consolidated statements of income and retained
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earnings of the Parent and its consolidated Subsidiaries and
of Centex and its consolidated Subsidiaries 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 or treasurer of the Parent and Centex, respectively
(provided that the Seller may satisfy this delivery obligation
through the delivery of the SEC quarterly report for the
Parent and Centex for such quarter referred to in clause (v)
below);
(ii) as soon as available and in any event within 120
days after the end of each fiscal year of the Parent and
Centex, a copy of the annual report for such year of the
Parent and its consolidated Subsidiaries and of Centex and its
consolidated Subsidiaries, containing financial statements for
such year audited by a "Big Five" accounting firm or other
independent public accountants of recognized national
standing;
(iii) as soon as available and in any event within 60
days after the end of the first three quarters and within 120
days after the end of the fourth fiscal quarter of each fiscal
year of the Seller, a balance sheet of the Seller as of the
end of such quarter and a statement of income and retained
earnings of the Seller for the period commencing at the end of
the previous fiscal year and ending with the end of such
quarter, certified by the chief financial officer of the
Seller;
(iv) as soon as possible and in any event within
three Business Days after the occurrence of each Event of
Termination or obtaining knowledge of any Incipient Event of
Termination, a statement of the chief financial officer of the
Seller setting forth details of such Event of Termination or
Incipient Event of Termination and the action that the Seller
has taken and proposes to take with respect thereto;
(v) promptly after the sending or filing thereof,
copies of all reports that Centex or the Parent sends to any
of its security holders generally, and copies of all Form
10-K, Form 10-Q and Form 8-K reports that Centex or the Parent
files with the SEC;
(vi) promptly after the filing or receiving thereof,
copies of all reports and notices that the Seller or any
Affiliate files under ERISA with the Internal Revenue Service
or the Pension Benefit Guaranty Corporation or the U.S.
Department of Labor or
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that the Seller or any Affiliate receives from any of the
foregoing or from any multiemployer plan (within the meaning
of Section 4001(a)(3) of ERISA) to which the Seller or any
Affiliate is or was, within the preceding five years, a
contributing employer, in each case in respect of the
assessment of withdrawal liability or an event or condition
which could, in the aggregate, result in the imposition of
liability on the Seller and/or any such Affiliate in excess of
$2,500,000;
(vii) at least ten Business Days prior to any change
in the name of the Parent, any Originator or the Seller, a
notice setting forth the new name and the effective date
thereof;
(viii) as soon as possible and in any event within
three Business Days after the Seller obtains knowledge
thereof, notice of any "Event of Termination" or "Facility
Termination Date" under the Originator Purchase Agreement or
the Parent/Seller Purchase Agreement;
(ix) so long as any Capital shall be outstanding, as
soon as possible and in any event no later than the day of
occurrence thereof, notice that any Originator has stopped
selling to the Parent, pursuant to the Originator Purchase
Agreement, or that the Parent has stopped selling or
contributing to the Seller, pursuant to the Parent/Seller
Purchase Agreement, all newly arising Originator Receivables;
(x) at the time of the delivery of the financial
statements provided for in clauses (i) and (ii) of this
paragraph, a certificate of the chief financial officer of the
Seller, to the effect that, to the best of such officer's
knowledge, no Event of Termination has occurred and is
continuing or, if any Event of Termination has occurred and is
continuing, specifying the nature and extent thereof;
(xi) promptly after receipt thereof, copies of all
notices received by the Seller from the Parent under the
Parent/Seller Purchase Agreement; and
(xii) such other information respecting the
Receivables or the condition or operations, financial or
otherwise, of the Seller, the Parent or any Originator as the
Agent may from time to time reasonably request, provided that,
if requested by the
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Seller, the Parent or any Originator, the Agent shall execute
a confidentiality agreement in respect of such information.
(l) Separateness. (i) The Seller shall at all times maintain
at least one independent manager who (x) is not currently and has not been
during the five years preceding the date of this Agreement an officer, director
or employee of the Parent or an Affiliate of the Parent, other than an
independent member, director or manager of any bankruptcy remote, special
purpose Affiliate of the Parent, (y) is not a current or former officer or
employee of the Seller and (z) otherwise meets the requirements of an
independent manager under the Seller's limited liability company agreement.
(ii) The Seller shall not direct or participate in
the management of any of the Other Companies' operations.
(iii) The Seller shall conduct its business from an
office separate from that of the Other Companies (but which
may be located in the same facility as one or more of the
Other Companies). The Seller shall have stationery and other
business forms and a mailing address and a telephone number
separate from that of the Other Companies.
(iv) The Seller shall at all times be adequately
capitalized in light of its contemplated business.
(v) The Seller shall at all times provide for its own
operating expenses and liabilities from its own funds.
(vi) The Seller shall maintain its assets and
transactions separately from those of the Other Companies and
reflect such assets and transactions in financial statements
separate and distinct from those of the Other Companies and
evidence such assets and transactions by appropriate entries
in books and records separate and distinct from those of the
Other Companies. The Seller shall hold itself out to the
public under the Seller's own name as a legal entity separate
and distinct from the Other Companies. The Seller shall not
hold itself out as having agreed to pay, or as being liable,
primarily or secondarily, for, any obligations of the Other
Companies.
(vii) The Seller shall not maintain any joint account
with any Other Company or become liable as a
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guarantor or otherwise with respect to any Debt or contractual
obligation of any Other Company.
(viii) The Seller shall not make any payment or
distribution of assets with respect to any obligation of any
Other Company or grant an Adverse Claim on any of its assets
to secure any obligation of any Other Company.
(ix) The Seller shall not make loans, advances or
otherwise extend credit to any of the Other Companies other
than Purchaser Loans (as defined in the Parent/Seller Purchase
Agreement) on the terms and conditions set forth in the
Parent/Seller Purchase Agreement.
(x) The Seller shall hold regular duly noticed
meetings of its members and make and retain minutes of such
meetings (or otherwise duly effect the same by means of
written consents).
(xi) The Seller shall have bills of sale (or similar
instruments of assignment) and, if appropriate, UCC-1
financing statements, with respect to all assets purchased
from any of the Other Companies.
(xii) The Seller shall not engage in any transaction
with any of the Other Companies, except as permitted by this
Agreement and as contemplated by the Parent/Seller Purchase
Agreement and the other Transaction Documents.
(xiii) The Seller shall comply with (and cause to be
true and correct) each of the agreements contained in Section
9(b)(v) of its limited liability company agreement.
(m) Parent/Seller Purchase Agreement. The Seller will not
amend, waive or modify any provision of the Parent/Seller Purchase Agreement
(provided that the Seller may extend the "Facility Termination Date" thereunder)
or waive the occurrence of any "Event of Termination" under the Parent/Seller
Purchase Agreement, without in each case the prior written consent of the Agent.
The Seller will perform all of its obligations under the Parent/Seller Purchase
Agreement in all material respects and will enforce the Parent/Seller Purchase
Agreement in accordance with its terms in all material respects.
(n) Nature of Business. The Seller will not engage in any
business other than the purchase of Originator Receivables,
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Related Security and Collections from the Parent and the transactions
contemplated by this Agreement and the other Transaction Documents. The Seller
will not create or form any Subsidiary.
(o) Mergers, Etc. The Seller will not 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) to, or
acquire all or substantially all of the assets or capital stock or other
ownership interest of, or enter into any joint venture or partnership agreement
with, any Person, other than as contemplated by this Agreement, the
Parent/Seller Purchase Agreement and the Originator Purchase Agreement.
(p) Distributions, Etc. The Seller will not declare or make
any dividend payment or other distribution of assets, properties, cash, rights,
obligations or securities on account of any membership interests of the Seller,
or return any capital to its members as such, or purchase, retire, defease,
redeem or otherwise acquire for value or make any payment in respect of any
membership interests of the Seller or any warrants, rights or options to acquire
any such membership interests, now or hereafter outstanding; provided, however,
that the Seller may declare and pay cash distributions on its membership
interests to its members so long as (i) no Event of Termination shall then exist
or would occur as a result thereof, (ii) such distributions are in compliance
with all applicable law including the limited liability company law of the state
of Seller's formation, and (iii) such distributions have been approved by all
necessary and appropriate limited liability company action of the Seller.
(q) Debt. The Seller will not incur any Debt, other than any
Debt incurred pursuant to this Agreement, the other Transaction Documents and
the Purchase Price Note.
(r) Limited Liability Company Agreement. The Seller will not
amend or delete (or permit any amendment or deletion of) the definition of
"Independent Manager" or any of Sections 7, 9, 10, 21, 22, 24, 29 or 31 of its
limited liability company agreement.
(s) Tangible Net Worth. The Seller will maintain Tangible Net
Worth at all times equal to at least 3% of the Outstanding Balance of the
Receivables at such time.
(t) Taxes. The Seller will file all tax returns and reports
required by law to be filed by it and will promptly pay all taxes and
governmental charges at any time owing, except such
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as are being contested in good faith by appropriate proceedings and for which
appropriate reserves have been established. The Seller will pay when due any
taxes payable in connection with the Receivables, exclusive of taxes on or
measured by income or gross receipts of the Agent, the Investors and the Banks.
SECTION 5.02. Covenants of the Seller and Parent. Until the
latest of the Facility Termination Date or the date on which no Capital of or
Yield on any Receivable Interest shall be outstanding or the date all other
amounts owed by the Seller hereunder to the Investors, the Banks or the Agent
are paid in full, each of the Seller and the Parent will, at their respective
expense, from time to time during regular business hours as reasonably requested
by the Agent, permit the Agent or its agents or representatives (including
independent public accountants, which may be the Seller's, the Parent's or any
Originator's independent public accountants), (i) to conduct periodic audits of
the Receivables, the Related Security and the related books and records and
collections systems of the Seller, the Parent or any Originator, as the case may
be, (ii) to examine and make copies of and abstracts from all books, records and
documents (including, without limitation, computer tapes and disks) in the
possession or under the control of the Seller, the Parent or any Originator, as
the case may be, relating to Pool Receivables and the Related Security,
including, without limitation, the Contracts, and (iii) to visit the offices and
properties of the Seller, the Parent or any Originator, as the case may be, for
the purpose of examining such materials described in clause (ii) above, and to
discuss matters relating to Pool Receivables and the Related Security or the
Seller's, the Parent's or any Originator's performance under the Transaction
Documents or under the Contracts with any of the officers or employees of the
Seller, the Parent or any Originator, as the case may be, having knowledge of
such matters.
SECTION 5.03. Covenant of the Parent. Until the latest of the
Facility Termination Date or the date on which no Capital of or Yield on any
Receivable Interest shall be outstanding or the date all other amounts owed by
the Seller hereunder to the Investors, the Banks or the Agent are paid in full:
(a) Interest Coverage Ratio. The Parent will not permit the
ratio, determined as of the end of each of its fiscal quarters for the then
most-recently ended four fiscal quarters, of (i) Consolidated EBIT (as defined
in the Credit Agreement) to (ii) Consolidated Interest Expense (as defined in
the Credit Agreement) to be less than 3.00 to 1.00 or such other ratio as may be
agreed to in an amendment to the Credit Agreement entered
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into within 60 days from the date hereof. The Parent shall promptly provide the
Agent with a copy of any such amendment.
(b) Leverage Ratio. The Parent will not permit the ratio,
determined as of the end of each of its fiscal quarters, of (i) Consolidated
Funded Indebtedness (as defined in the Credit Agreement) to (ii) Consolidated
EBITDA (as defined in the Credit Agreement) for the then most-recently ended
four fiscal quarters to be greater than: (A) 3.50 to 1.00 as of the end of any
fiscal quarter through and including the fiscal quarter ending March 31, 2002;
(B) 3.25 to 1.00 as of the end of any subsequent fiscal quarter through and
including the fiscal quarter ending September 30, 2002; and (C) 3.00 to 1.00 as
of the end of any subsequent fiscal quarter.
(c) Dividends. The Parent will not, nor will it permit any
Subsidiary (as defined in the Credit Agreement) to, declare or pay any dividends
or make any distributions on its capital stock or other equity interests (other
than dividends payable in its own capital stock or other equity interests) or
redeem, repurchase or otherwise acquire or retire any of its capital stock or
other equity interests at any time outstanding, except that (i) any Subsidiary
(as defined in the Credit Agreement) may declare and pay dividends or make
distributions to the Parent or to a Wholly-Owned Subsidiary (as defined in the
Credit Agreement) and (ii) when no Default (as defined in the Credit Agreement)
exists or will result therefrom, the Parent may pay dividends on its capital
stock during each fiscal year in an amount not to exceed in the aggregate
$5,000,000; provided that this Section 5.03(c) shall be deemed modified to give
effect to any amendments to Section 6.10 of the Credit Agreement entered into
within 60 days of the date hereof. The Parent shall promptly provide the Agent
with a copy of any such amendment. The foregoing shall not permit the Seller to
declare or pay any dividends or make any distributions, which declarations and
payments by the Seller shall be governed by Section 5.01(p) hereof.
(d) Minimum Tangible Net Worth. As of March 31, 2001, the
Parent will at all times maintain Consolidated Tangible Net Worth (as defined in
the Credit Agreement) of not less than $326,826,000 and for the last day of each
fiscal quarter thereafter, not less than the sum of (i) the minimum Consolidated
Tangible Net Worth (as defined in the Credit Agreement) required for the prior
fiscal quarter, plus (ii) 50% of the Consolidated Net Income (as defined in the
Credit Agreement) (not less than $0.00) for the fiscal quarter then ended, plus
(iii) 100% of the Net Cash Proceeds (as defined in the Credit Agreement) of any
equity issuances (excluding issuances described in clause (a) of the first
sentence of Section 2.25 of the Credit Agreement as in
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effect on the date hereof and issuances solely to finance Permitted Acquisitions
(as defined in the Credit Agreement)) by the Parent or any Subsidiary (as
defined in the Credit Agreement) for the fiscal quarter then ended; provided
that this Section 5.03(d) shall be deemed modified to give effect to any
amendments to Section 6.22.3 of the Credit Agreement entered into within 60 days
of the date hereof. The Parent shall promptly provide the Agent with a copy of
any such amendment.
All terms used in this Section 5.03 as defined in the Credit
Agreement (as well as any defined terms used in such terms) shall have the
respective meanings as set forth in the Credit Agreement as in effect on the
date hereof.
ARTICLE VI
ADMINISTRATION AND COLLECTION
OF POOL RECEIVABLES
SECTION 6.01. Designation of Collection Agent. The servicing,
administration and collection of the Pool Receivables shall be conducted by the
Collection Agent so designated hereunder from time to time. Until the Agent
gives notice to the Seller of the designation of a new Collection Agent (which
notice may only be given following the occurrence and during the continuation of
an Event of Termination), the Parent is hereby designated as, and hereby agrees
to perform the duties and obligations of, the Collection Agent pursuant to the
terms hereof. The Agent at any time during the existence of an Event of
Termination may designate as Collection Agent any Person (including itself) to
succeed the Parent or any successor Collection Agent, if such Person shall
consent and agree to the terms hereof. The Collection Agent may, with the prior
consent of the Agent, subcontract with any other Person or Persons for the
servicing, administration or collection of all or any portion of the Pool
Receivables; provided that the Agent's consent shall not be required for any
such subcontract with an Originator in respect of the Pool Receivables
originated by such Originator. Any such subcontract shall not affect the
Collection Agent's liability for performance of its duties and obligations
pursuant to the terms hereof.
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SECTION 6.02. Duties of Collection Agent. (a) The Collection
Agent shall take or cause to be taken all such actions as may be necessary or
advisable to collect each Pool Receivable from time to time, all in accordance
with applicable laws, rules and regulations, with reasonable care and diligence,
and in accordance with the applicable Credit and Collection Policy. The Seller
and the Agent hereby appoint the Collection Agent, from time to time designated
pursuant to Section 6.01, as agent for themselves and for the Investors and the
Banks to enforce their respective rights and interests in the Pool Receivables,
the Related Security and the related Contracts. In performing its duties as
Collection Agent, the Collection Agent shall exercise the same care and apply
the same policies as it would exercise and apply if it owned such Receivables
and shall act in the best interests of the Seller, the Investors and the Banks.
(b) The Collection Agent shall administer the Collections in
accordance with the procedures described in Section 2.04.
(c) If no Event of Termination or Incipient Event of
Termination shall have occurred and be continuing, the Parent or any Affiliate
thereof, while it is the Collection Agent, may, in accordance with the Credit
and Collection Policy of the applicable Originator, extend the maturity or
adjust the Outstanding Balance of any Receivable as the Parent or such Affiliate
deems appropriate to maximize Collections thereof, or otherwise amend, modify or
waive the terms of any Receivable, provided that the classification of any such
Receivable as a Delinquent Receivable or Defaulted Receivable shall not be
affected by any such extension.
(d) The Collection Agent shall hold in trust for the Seller
and each Investor and Bank, in accordance with their respective interests, all
documents, instruments and records (including, without limitation, computer
tapes or disks) which evidence or relate to Pool Receivables. The Collection
Agent shall cause the master data processing records evidencing the Pool
Receivables to be marked to indicate that Receivable Interests therein have been
sold in accordance with this Agreement.
(e) The Collection Agent shall, as soon as practicable
following receipt, turn over to the Seller any cash collections or other cash
proceeds received with respect to Receivables not constituting Pool Receivables.
(f) The Collection Agent shall, from time to time at the
request of the Agent during the continuance of an Event of Termination or
Incipient Event of Termination, furnish to the
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Agent (promptly after any such request) a calculation of the amounts set aside
for the Investors and the Banks pursuant to Section 2.04.
(g) Prior to the 10th Business Day of each month, the
Collection Agent shall prepare and forward to the Agent a Seller Report relating
to the Receivable Interests outstanding on the last day of the immediately
preceding month.
SECTION 6.03. Certain Rights of the Agent. (a) The Agent is
authorized at any time during the existence of an Event of Termination or an
Incipient Event of Termination, to date, and to deliver to the Lock-Box Banks,
the notices of effectiveness attached to the Lock-Box Agreements. The Seller
hereby transfers to the Agent the exclusive control and, upon the occurrence of
an Event of Termination or an Incipient Event of Termination, ownership of the
Lock-Box Accounts to which the Obligors of Pool Receivables shall make payments.
The Agent may notify the Obligors of Pool Receivables, at any time and at the
Seller's expense, of the ownership of Receivable Interests under this Agreement;
provided that any such notice shall be subject to the Seller's prior written
approval, which shall not be unreasonably withheld.
(b) At any time during the existence of an Event of
Termination or Incipient Event of Termination:
(i) The Agent may direct the Obligors of Pool
Receivables that all payments thereunder be made directly to
the Agent or its designee.
(ii) At the Agent's request and at the Seller's
expense, the Seller shall notify each Obligor of Pool
Receivables of the ownership of Receivable Interests under
this Agreement and direct that payments be made directly to
the Agent or its designee.
(iii) At the Agent's request and at the Seller's
expense, the Seller and the Collection Agent shall (A)
assemble all of the documents, instruments and other records
(including, without limitation, computer tapes and disks) that
evidence or relate to the Pool Receivables and the related
Contracts and Related Security, or that are otherwise
necessary or desirable to collect the Pool Receivables, and
shall make the same available to the Agent at a place selected
by the Agent or its designee, and (B) segregate all cash,
checks and other instruments received by it from time to time
constituting Collections of Pool Receivables in a manner
acceptable to the Agent and, promptly upon
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receipt, remit all such cash, checks and instruments, duly
indorsed or with duly executed instruments of transfer, to the
Agent or its designee.
(iv) The Seller authorizes the Agent to take any and
all steps in the Seller's name and on behalf of the Seller
that are necessary or desirable, in the determination of the
Agent, to collect amounts due under the Pool Receivables,
including, without limitation, endorsing the Seller's name on
checks and other instruments representing Collections of Pool
Receivables and enforcing the Pool Receivables and the Related
Security and related Contracts.
SECTION 6.04. Rights and Remedies. (a) If the Collection Agent
fails to perform any of its obligations under this Agreement, the Agent may (but
shall not be required to) itself perform, or cause performance of, such
obligation; and the Agent's reasonable costs and expenses incurred in connection
therewith shall be payable by the Collection Agent.
(b) The Seller and the Parent shall perform their respective
obligations under the Contracts related to the Pool Receivables to the same
extent as if Receivable Interests had not been sold and the exercise by the
Agent on behalf of the Investors and the Banks of their rights under this
Agreement shall not release the Collection Agent or the Seller from any of their
duties or obligations with respect to any Pool Receivables or related Contracts.
Neither the Agent, the Investors nor the Banks shall have any obligation or
liability with respect to any Pool Receivables or related Contracts, nor shall
any of them be obligated to perform the obligations of the Seller thereunder.
(c) In the event of any conflict between the provisions of
Article VI of this Agreement and Article VI of the Parent/Seller Purchase
Agreement, the provisions of this Agreement shall control.
SECTION 6.05. Further Actions Evidencing Purchases. The Parent
agrees from time to time, at its expense, upon the request of the Agent, to
promptly execute and deliver all further instruments and documents, and to take
all further actions, that may be reasonably necessary or desirable, or that the
Agent may reasonably request, to perfect, protect or more fully evidence the
Receivable Interests purchased hereunder, or to enable the Investors, the Banks
or the Agent to exercise and enforce their respective rights and remedies
hereunder. Without limiting the foregoing, the Parent will (i) upon the request
of the Agent, execute and file, or cause to be executed and filed, such
financing or continuation statements, or amendments thereto, and
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such other instruments and documents, that may be reasonably necessary or
desirable, or that the Agent may reasonably request, to perfect, protect or
evidence such Receivable Interests; and (ii) cause the master data processing
records evidencing the Pool Receivables to be marked to indicate that Receivable
Interests therein have been sold in accordance with this Agreement.
SECTION 6.06. Audits; Changes in Credit and Collection Policy.
(a) The Collection Agent (if other than the Parent) will, from time to time
during regular business hours as requested by the Agent, permit the Agent, or
its agents or representatives (including independent public accountants, which
may be the Collection Agent's independent public accountants), (i) to conduct
periodic audits of the Receivables, the Related Security and the related books
and records and collections systems of the Collection Agent, (ii) to examine and
make copies of and abstracts from all books, records and documents (including,
without limitation, computer tapes and disks) in the possession or under the
control of the Collection Agent relating to Pool Receivables and the Related
Security, including, without limitation, the Contracts, and (iii) to visit the
offices and properties of the Collection Agent for the purpose of examining such
materials described in clause (ii) above, and to discuss matters relating to
Pool Receivables and the Related Security or the Collection Agent's performance
hereunder with any of the officers or employees of the Collection Agent having
knowledge of such matters.
(b) The Seller and the Parent agree that none of the
Originators will make any change in their Credit and Collection Policies that
would impair the collectibility of any Pool Receivable or the ability of the
Parent (if it is acting as Collection Agent) to perform its obligations under
this Agreement. In the event that any Originator makes any material change to
the Credit and Collection Policy, the Collection Agent shall, contemporaneously
with such change, provide the Agent with an updated Credit and Collection Policy
and a summary of all material changes.
(c) The Parent will not amend, waive or modify any provision
of the Originator Purchase Agreement (provided that the Parent may extend the
"Facility Termination Date" thereunder) or waive the occurrence of any "Event of
Termination" under the Originator Purchase Agreement, without in each case the
prior written consent of the Agent. The Parent will perform all of its
obligations under the Originator Purchase Agreement in all material respects and
will enforce the Originator Purchase Agreement in accordance with its terms in
all material respects.
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SECTION 6.07. Indemnities by the Collection Agent. Without
limiting any other rights that the Agent, any Investor, any Bank or any of their
respective Affiliates (each, a "Special Indemnified Party") may have hereunder
or under applicable law, and in consideration of its appointment as Collection
Agent, the Collection Agent hereby agrees to indemnify each Special Indemnified
Party from and against any and all claims, losses and liabilities (including
reasonable attorneys' fees) (all of the foregoing being collectively referred to
as "Special Indemnified Amounts") arising out of or resulting from any of the
following (excluding, however, (a) Special Indemnified Amounts to the extent
resulting from gross negligence, bad faith or willful misconduct on the part of
such Special Indemnified Party or of any affiliated Special Indemnified Party
acting in connection with the Transaction Documents, (b) recourse for
uncollectible Receivables or (c) any income taxes or any other tax or fee
measured by income incurred by such Special Indemnified Party arising out of or
as a result of this Agreement or the ownership of Receivable Interests or in
respect of any Receivable or any Contract):
(i) any representation or warranty or statement made
or deemed made by the Collection Agent under or in connection
with this Agreement (other than that contained in Section
4.02(g) hereof) which shall have been incorrect in any
material respect when made;
(ii) the failure by the Collection Agent to comply
with any applicable law, rule or regulation with respect to
any Pool Receivable or Contract;
(iii) the failure to have filed, or any delay in
filing, financing statements or other similar instruments or
documents under the UCC of any applicable jurisdiction or
other applicable laws with respect to any Receivables in, or
purporting to be in, the Receivables Pool, the Contracts and
the Related Security and Collections in respect thereof,
whether at the time of any purchase or reinvestment or at any
subsequent time;
(iv) any failure of the Collection Agent to perform
its duties or obligations in accordance with the provisions of
this Agreement;
(v) the commingling of Collections of Pool
Receivables at any time by the Collection Agent with other
funds;
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(vi) any action or omission by the Collection Agent
reducing or impairing the rights of the Investors or the Banks
with respect to any Pool Receivable or the value of any Pool
Receivable;
(vii) any Collection Agent Fees or other costs and
expenses payable to any replacement Collection Agent, to the
extent a current market rate fee and to the extent in excess
of the Collection Agent Fees payable to the Collection Agent
hereunder;
(viii) any claim brought by any Person other than a
Special Indemnified Party arising from any activity by the
Collection Agent or its Affiliates in servicing, administering
or collecting any Receivable;
(ix) the representation made or deemed made by the
Collection Agent in Section 4.02(g) hereof shall have been
incorrect in any respect when made; or
(x) the creation hereunder of an undivided percentage
ownership interest in any Receivable which purports to be part
of the Net Receivables Pool Balance but which is not at the
date of the creation hereunder of such interest an Eligible
Receivable or which thereafter ceases to be an Eligible
Receivable other than by such Receivable becoming a Delinquent
Receivable or a Defaulted Receivable subsequent to the
purchase of a Receivable Interest therein hereunder.
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01. Events of Termination. If any of the following
events ("Events of Termination", except as otherwise provided in Section 7.02)
shall occur and be continuing:
(a) The Collection Agent (if the Parent, an Originator or an
Affiliate of the Parent or an Originator) (i) shall fail to perform or observe
any term, covenant or agreement under this Agreement (other than as referred to
in clause (ii) of this subsection (a)) and such failure shall remain unremedied
for three Business Days or (ii) shall fail to make when due any payment or
deposit to be made by it under this Agreement, provided that an Event of
Termination shall not occur under this clause (ii) if such failure is caused not
by the unavailability of funds but is caused solely by a technical or
administrative error which is remedied within one Business Day after notice of
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such failure is given to the Collection Agent or the Collection Agent first
becomes aware of such error; provided, further, that the preceding proviso may
not be utilized more than once in any three month period; or
(b) The Seller shall fail to make any payment required under
Section 2.04(e)(i) or (ii) and such failure shall remain unremedied for one
Business Day after the earlier of (x) written notice thereof delivered to the
Seller or (y) the Seller or the Parent otherwise obtains knowledge thereof; or
(c) Any representation or warranty made or deemed made by the
Seller, the Parent, any Originator or the Collection Agent (or any of their
respective officers) under or in connection with this Agreement or any other
Transaction Document or any information or report delivered by the Seller, the
Parent, any Originator or the Collection Agent pursuant to this Agreement or any
other Transaction Document shall prove to have been incorrect or untrue in any
material respect when made or deemed made or delivered; or
(d) The Seller, the Parent or any Originator shall fail to
perform or observe any other term, covenant or agreement contained in any
Transaction Document on its part to be performed or observed and any such
failure shall remain unremedied for 15 days (provided, however, that no grace
period shall be permitted for any failure by the Seller, the Parent (as
Collection Agent or otherwise) or any Originator under any of Sections 5.01(a),
(d), (e), (f), (g), (h), (k)(iv), (k)(viii), (l), (m), (n), (o), (p), (q), (r)
or (t) or 5.03); or
(e) The Seller, the Parent or any Originator shall fail to pay
any principal of or premium or interest on any of its Debt which is outstanding
in a principal amount of at least $2,500,000 in the aggregate 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 Debt; or any other event shall occur or condition shall exist
under any agreement or instrument relating to any such Debt and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such Debt; or any such Debt shall be
declared to be due and payable, or required to be prepaid (other than by a
regularly scheduled required prepayment), redeemed, purchased or defeased, or an
offer to repay, redeem, purchase or defease such Debt shall be required to be
made, in each case prior to the stated maturity thereof; or
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(f) Any purchase or any reinvestment pursuant to this
Agreement shall for any reason (other than pursuant to the terms hereof) cease
to create, or any Receivable Interest shall for any reason cease to be, a valid
and perfected first priority undivided percentage ownership interest to the
extent of the pertinent Receivable Interest in each applicable Pool Receivable
and the Related Security and Collections with respect thereto; or the security
interest created pursuant to Section 2.11 shall for any reason cease to be a
valid and perfected first priority security interest in the collateral security
referred to in that section; or
(g) The Seller, the Parent or any Originator shall generally
not pay its debts as such debts become due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted by or against the
Seller, the Parent or any Originator seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted against the
Seller, the Parent or any Originator (but not instituted by the Seller, the
Parent or such Originator), either such proceeding shall remain undismissed or
unstayed for a period of 45 days, or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, the Seller, the Parent or such Originator or for any substantial
part of the Seller's, the Parent's or such Originator's property) shall occur;
or the Seller, the Parent or any Originator shall take any corporate or other
action to authorize any of the actions set forth above in this subsection (g);
or
(h) As of the last day of any calendar month, (i) the Default
Ratio for such calendar month shall exceed 7.5%; (ii) the average of the Default
Ratio for each of such calendar month and the two prior calendar months shall
exceed 6.0%; (iii) the Delinquency Ratio for such calendar month shall exceed
7.5%; or (iv) the average of the Delinquency Ratio for each of such calendar
month and the two prior calendar months shall exceed 6.5%; or
(i) The sum of the Receivable Interests shall be greater than
100% for any two consecutive Business Days; or
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(j) There shall have occurred any material adverse change in
the financial condition or operations of the Parent and its consolidated
Subsidiaries taken as a whole since March 31, 2001; or there shall have occurred
any event which may materially adversely affect the collectibility of the
Receivables Pool or the ability of the Seller, the Parent, any Originator or the
Collection Agent to collect Pool Receivables or otherwise perform its
obligations under this Agreement or the other Transaction Documents; or
(k) An "Event of Termination" or "Facility Termination Date"
shall occur under the Parent/Seller Purchase Agreement or the Originator
Purchase Agreement, or the Parent/Seller Purchase Agreement or the Originator
Purchase Agreement shall cease to be in full force and effect; or
(l) All of the membership interests of the Seller (other than
any non-equity interest held by a Special Member (as defined and described in
the Amended and Restated Limited Liability Company Agreement of the Seller dated
as of June 29, 2001)) shall cease to be owned, of record and beneficially,
directly or indirectly, by the Parent or by the Parent and one or more of its
Subsidiaries; or
(m) At least 51% of the capital stock of the Parent shall
cease to be owned, of record and beneficially, directly or indirectly, by
Centex;
then, and in any such event (but subject to Section 7.02), any or all of the
following actions may be taken by notice to the Seller: (x) the Investor or the
Agent may declare the Facility Termination Date to have occurred (in which case
the Facility Termination Date shall be deemed to have occurred), (y) the Agent
may declare the Commitment Termination Date to have occurred (in which case the
Commitment Termination Date shall be deemed to have occurred), and (z) without
limiting any right under this Agreement to replace the Collection Agent, the
Agent may designate another Person to succeed the Parent as the Collection
Agent; provided, that, automatically upon the occurrence of any event (without
any requirement for the passage of time or the giving of notice) described in
paragraph (g) of this Section 7.01, the Facility Termination Date and the
Commitment Termination Date shall occur, the Parent (if it is then serving as
the Collection Agent) shall cease to be the Collection Agent, and the Agent or
its designee shall become the Collection Agent; and provided, further, that,
automatically upon the occurrence of any event described in paragraph (i) of
this Section 7.01 which continues for 5 Business Days, the Facility Termination
Date and the Commitment Termination Date shall occur. Upon any such
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declaration or designation or upon such automatic termination, the Investors,
the Banks and the Agent shall have, in addition to the rights and remedies which
they may have under this Agreement, all other rights and remedies provided after
default under the UCC and under other applicable law, which rights and remedies
shall be cumulative.
SECTION 7.02. Stop Purchase Events. Upon the occurrence of an
event described in Section 7.01(e), (g) or (j) in respect of a Non-Significant
Originator, and if and so long as all of the following conditions are satisfied,
no Event of Termination or Incipient Event of Termination shall be deemed to
exist as a result of the occurrence of such event, but Atlantic and the Banks
shall, at their option, be permitted to stop purchasing additional Receivables
originated by such Non- Significant Originator: (i) such event does not
adversely affect the collectibility of the Receivables of such Non-Significant
Originator then in the Receivables Pool, (ii) not purchasing additional
Receivables of such Non-Significant Originator would not, as determined by the
Agent in its reasonable discretion, have a material adverse effect on the
composition of the Receivables Pool, (iii) the Seller, the Parent and the
Originators shall otherwise be in compliance with the terms of this Agreement
and of the other Transaction Documents and no other Event of Termination or
Incipient Event of Termination shall then exist, (iv) no event described in
Section 7.01 (e), (g) or (j) has occurred with respect to any other
Non-Significant Originator within the preceding three months and (v) no Person
challenges the "true sale" nature of the transfer of any Receivables under the
Originator Purchase Agreement or the Parent/Seller Purchase Agreement.
ARTICLE VIII
THE AGENT
SECTION 8.01. Authorization and Action. Each Investor and each
Bank hereby appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement as are delegated to
the Agent by the terms hereof, together with such powers as are reasonably
incidental thereto.
SECTION 8.02. Agent's Reliance, Etc. Neither the Agent nor any
of its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them as Agent under or in connection with
this Agreement (including, without limitation, the Agent's servicing,
administering or collecting Pool Receivables as Collection
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Agent), except for its or their own gross negligence, bad faith or willful
misconduct. Without limiting the generality of the foregoing, the Agent: (a) may
consult with legal counsel (including counsel for the Seller, the Parent any
Originator and the Collection Agent), independent certified public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (b) makes no warranty or representation to any
Investor or Bank (whether written or oral) and shall not be responsible to any
Investor or Bank for any statements, warranties or representations (whether
written or oral) made in or in connection with this Agreement; (c) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement on the part of the
Seller, the Parent, any Originator or the Collection Agent or to inspect the
property (including the books and records) of the Seller, the Parent, any
Originator or the Collection Agent; (d) shall not be responsible to any Investor
or Bank for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; and (e) shall incur no liability under or in respect
of this Agreement by acting upon any notice (including notice by telephone),
consent, certificate or other instrument or writing (which may be by telecopier
or telex) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 8.03. Credit Lyonnais and Affiliates. The obligation
of Credit Lyonnais to purchase Receivable Interests under this Agreement may be
satisfied by Credit Lyonnais or any of its Affiliates. With respect to any
Receivable Interest or interest therein owned by it, Credit Lyonnais shall have
the same rights and powers under this Agreement as any Bank and may exercise the
same as though it were not the Agent. Credit Lyonnais and any of its Affiliates
may generally engage in any kind of business with the Seller, the Parent, any
Originator, the Collection Agent or any Obligor, any of their respective
Affiliates and any Person who may do business with or own securities of the
Seller, the Parent, any Originator, the Collection Agent or any Obligor or any
of their respective Affiliates, all as if Credit Lyonnais were not the Agent and
without any duty to account therefor to the Investors or the Banks.
SECTION 8.04. Bank's Purchase Decision. Each Bank acknowledges
that it has, independently and without reliance upon the Agent, any of its
Affiliates or any other Bank and based on such documents and information as it
has deemed appropriate, made its own evaluation and decision to enter into this
Agreement.
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Each Bank also acknowledges that it will, independently and without reliance
upon the Agent, any of its Affiliates or any other Bank and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own decisions in taking or not taking action under this Agreement.
ARTICLE IX
INDEMNIFICATION
SECTION 9.01. Indemnities by the Seller. Without limiting any
other rights that the Agent, the Investors, the Banks or any of their respective
Affiliates (each, an "Indemnified Party") may have hereunder or under applicable
law, the Seller hereby agrees to indemnify each Indemnified Party from and
against any and all claims, losses and liabilities (including reasonable
attorneys' fees) (all of the foregoing being collectively referred to as
"Indemnified Amounts") arising out of or resulting from this Agreement or the
other Transaction Documents or the use of proceeds of purchases or reinvestments
or the ownership of Receivable Interests or in respect of any Receivable or any
Contract, excluding, however, (a) Indemnified Amounts to the extent resulting
from gross negligence, bad faith or willful misconduct on the part of such
Indemnified Party or any affiliated Indemnified Party acting in connection with
the Transaction Documents, (b) recourse (except as otherwise specifically
provided in this Agreement) for uncollectible Receivables or (c) any income
taxes or any other tax or fee measured by income incurred by such Indemnified
Party arising out of or as a result of this Agreement or the ownership of
Receivable Interests or in respect of any Receivable or any Contract. Without
limiting or being limited by the foregoing, the Seller shall pay on demand to
each Indemnified Party any and all amounts necessary to indemnify such
Indemnified Party from and against any and all Indemnified Amounts arising out
of or resulting from any of the following (but excluding Indemnified Amounts and
taxes described in clauses (a) and (c) above):
(i) the creation hereunder of an undivided percentage
ownership interest in any Receivable which purports to be part
of the Net Receivables Pool Balance but which is not at the
date of the creation hereunder of such interest an Eligible
Receivable or which thereafter ceases to be an Eligible
Receivable other than by such Receivable becoming a Delinquent
Receivable or a Defaulted Receivable subsequent to the
purchase of a Receivable Interest therein hereunder;
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(ii) any representation or warranty or statement made
or deemed made by the Seller (or any of its officers) under or
in connection with this Agreement or any of the other
Transaction Documents which shall have been incorrect in any
material respect when made;
(iii) the failure by the Seller or any Originator to
comply with any applicable law, rule or regulation with
respect to any Pool Receivable or the related Contract; or the
failure of any Pool Receivable or the related Contract to
conform to any such applicable law, rule or regulation;
(iv) the failure to vest in the Investors or the
Banks, as the case may be, (a) a perfected undivided
percentage ownership interest, to the extent of each
Receivable Interest, in the Receivables in, or purporting to
be in, the Receivables Pool and the Related Security and
Collections in respect thereof, or (b) a perfected security
interest as provided in Section 2.11, in each case free and
clear of any Adverse Claim;
(v) the failure to have filed, or any delay in
filing, financing statements or other similar instruments or
documents under the UCC of any applicable jurisdiction or
other applicable laws with respect to any Receivables in, or
purporting to be in, the Receivables Pool and the Related
Security and Collections in respect thereof, whether at the
time of any purchase or reinvestment 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 in, or purporting to be in, the
Receivables Pool (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 of the merchandise or
services related to such Receivable or the furnishing or
failure to furnish such merchandise or services or relating to
collection activities with respect to such Receivable (if such
collection activities were performed by the Seller or any of
its Affiliates acting as Collection Agent);
(vii) any failure of the Seller to perform its duties
or obligations in accordance with the provisions
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hereof or to perform its duties or obligations under the
Contracts;
(viii) any products liability or other claim arising
out of or in connection with merchandise, insurance or
services which are the subject of any Contract;
(ix) the commingling of Collections of Pool
Receivables at any time with other funds;
(x) any investigation, litigation or proceeding
related to this Agreement or the use of proceeds of purchases
or reinvestments or the ownership of Receivable Interests or
in respect of any Receivable or Related Security or Contract;
(xi) any failure of the Seller to comply with its
covenants contained in this Agreement or any other Transaction
Document; or
(xii) any claim brought by any Person other than an
Indemnified Party arising from any activity by the Seller or
any Affiliate of the Seller in servicing, administering or
collecting any Receivable.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. Amendments, Etc. No amendment or waiver of any
provision of this Agreement or consent to any departure by the Seller or the
Parent therefrom shall be effective unless in a writing signed by the Agent, as
agent for the Investors and the Banks (and, in the case of any amendment or any
waiver by the Seller or the Parent, also signed by the Seller and the Parent),
and then such amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by the Collection Agent in addition to the Agent, affect the rights or
duties of the Collection Agent under this Agreement. Notwithstanding the
foregoing (but only to the extent required by the relevant rating agencies then
rating the commercial paper of each Investor), no material amendment to or
material waiver of any provision of this Agreement, nor consent to any material
departure by the Seller or Collection Agent therefrom, shall be effective unless
a written statement is obtained from such relevant rating agencies that the
rating of the commercial paper of such Investor will not be downgraded or
withdrawn solely as a result of such amendment,
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waiver or consent (provided that no such statement shall be required in
connection with an amendment the sole purpose of which is to extend the
Commitment Termination Date or the Facility Termination Date or to cure any
ambiguity). No failure on the part of the Investors, the Banks or the Agent 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.
SECTION 10.02. Notices, Etc. All notices and other
communications hereunder shall, unless otherwise stated herein, be in writing
(which shall include facsimile communication) and faxed or delivered, 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. Notices and communications by
facsimile shall be effective when sent (and shall be followed by hard copy sent
by regular mail), and notices and communications sent by other means shall be
effective when received.
SECTION 10.03. Assignability. (a) This Agreement and the
Investors' rights and obligations herein (including ownership of each Receivable
Interest) shall not be assignable by the Investors or their successors and
assigns except by operation of law or to an Eligible Assignee. Each assignor of
a Receivable Interest or any interest therein shall notify the Agent and the
Seller of any such permitted assignment. Each assignor of a Receivable Interest
or any interest therein may, in connection with the permitted assignment or
participation, disclose to the assignee or participant any information relating
to the Seller, the Parent or any Originator, including the Receivables,
furnished to such assignor by or on behalf of the Seller or by the Agent.
(b) Each Bank may assign to any Eligible Assignee or to any
other Bank all or a portion of its rights and obligations under this Agreement
(including, without limitation, all or a portion of its Bank Commitment and any
Receivable Interests or interests therein owned by it). The parties to each such
assignment shall execute and deliver to the Agent an assignment agreement in
form and substance satisfactory to the Agent.
(c) This Agreement and the rights and obligations of the Agent
herein shall not be assignable by the Agent or its successors and assigns except
by operation of law or to an Eligible Assignee.
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(d) The Seller may not assign its rights or obligations
hereunder or any interest herein without the prior written consent of the Agent.
SECTION 10.04. Costs, Expenses and Taxes. (a) In addition to
the rights of indemnification granted under Section 9.01 hereof, the Seller
agrees to pay on demand all reasonable costs and expenses in connection with the
preparation, execution, delivery and administration (including periodic auditing
and the other activities contemplated in Section 5.02) of this Agreement, any
Asset Purchase Agreement and the other documents and agreements to be delivered
hereunder, including, without limitation, the reasonable fees and out-of-pocket
expenses of counsel for the Agent, Credit Lyonnais, Atlantic, and their
respective Affiliates with respect thereto and with respect to advising the
Agent, Credit Lyonnais, Atlantic, and their respective Affiliates as to their
rights and remedies under this Agreement, and all costs and expenses, if any
(including reasonable counsel fees and expenses), of the Agent, Credit Lyonnais,
the Investors, the Banks and their respective Affiliates, in connection with the
enforcement of this Agreement and the other documents and agreements to be
delivered hereunder; provided that any such fees and expenses in respect of
counsel for the Agent, Credit Lyonnais, Atlantic, and their respective
Affiliates shall be limited to such fees and expenses of one firm of attorneys.
(b) In addition, the Seller shall pay, to the extent not
included in the calculation of Yield, (i) any and all commissions of placement
agents and dealers in respect of commercial paper notes issued by Atlantic to
fund the purchase or maintenance of any Receivable Interest, and (ii) any and
all costs and expenses of any issuing and paying agent or other Person
responsible for the administration of Atlantic's commercial paper program in
connection with the preparation, completion, issuance, delivery or payment of
commercial paper notes issued to fund the purchase or maintenance of any
Receivable Interest.
SECTION 10.05. No Proceedings. Each of the Seller, the Parent,
the Agent, the Collection Agent, each Investor, each Bank, each assignee of a
Receivable Interest or any interest therein and each entity which enters into a
commitment to purchase Receivable Interests or interests therein hereby agrees
that it will not institute or join any other person in instituting against
Atlantic any proceeding of the type referred to in Section 7.01(g) for one year
and a day after the latest maturing commercial paper note issued by Atlantic is
paid.
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SECTION 10.06. Confidentiality. (a) Each of the Seller, the
Parent and the Collection Agent agrees to maintain the confidentiality of this
Agreement and the other Transaction Documents in communications with third
parties and otherwise; provided that this Agreement and the other Transaction
Documents may be disclosed (i) to the Originators and their Affiliates if they
agree to hold such documents confidential, (ii) to the legal counsel and
auditors of the Seller, the Parent, the Originators and the Collection Agent if
they agree to hold such documents confidential, (iii) to the extent required by
applicable law or regulation or by any court, regulatory body or agency having
jurisdiction over such party and (iv) to other Persons to the extent such
disclosure is made pursuant to a written agreement of confidentiality in form
and substance reasonably satisfactory to the Agent; and provided, further, that
such party shall have no obligation of confidentiality in respect of any
information which may be generally available to the public or becomes available
to the public through no fault of such party.
(b) Each Investor, each Bank and the Agent agrees to maintain
the confidentiality of all information with respect to the Seller, the Parent,
the Originators or the Receivables Pool (including the Seller Reports) furnished
or delivered to it pursuant to this Agreement; provided, that such information
may be disclosed (i) to such party's legal counsel and auditors and to such
party's assignees and participants and potential assignees and participants and
their respective counsel if they agree to hold it confidential on the same terms
as the disclosing party, (ii) to the rating agencies and the providers of
liquidity or credit enhancement for each Investor, and (iii) to the extent
required by applicable law or regulation or by any court, regulatory body or
agency having jurisdiction over such party; and provided, further, that such
party shall have no obligation of confidentiality in respect of any information
which may be generally available to the public or becomes available to the
public through no fault of such party.
SECTION 10.07. GOVERNING LAW. THIS AGREEMENT SHALL, IN
ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK, BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE
OF NEW YORK WITHOUT REGARD TO ANY CONFLICT OF LAWS PRINCIPLES THEREOF THAT WOULD
CALL FOR THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE
EXTENT THAT, PURSUANT TO THE UCC OF THE STATE OF NEW YORK, THE PERFECTION AND
THE EFFECT OF PERFECTION OR NON-PERFECTION OF THE INTERESTS OF THE INVESTORS AND
THE BANKS IN THE RECEIVABLES AND THE ORIGINATOR PURCHASE AGREEMENT ARE GOVERNED
BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
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SECTION 10.08. Execution in Counterparts. This Agreement may
be executed in any number of 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 10.09. Survival of Termination. The provisions of
Sections 2.08, 2.09, 6.07, 9.01, 10.04, 10.05 and 10.06 shall survive any
termination of this Agreement.
SECTION 10.10. Consent to Jurisdiction. (a) Each party hereto
hereby irrevocably submits to the non-exclusive jurisdiction of any New York
State or Federal court sitting in New York City in any action or proceeding
arising out of or relating to this Agreement, and each party hereto hereby
irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in such New York State court or, to the extent permitted
by law, in such Federal court. The parties hereto hereby irrevocably waive, to
the fullest extent they may effectively do so, the defense of an inconvenient
forum to the maintenance of such action or proceeding. The parties hereto agree
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.
(b) Each of the parties hereto consents to the service of any
and all process in any such action or proceeding by the mailing of copies of
such process to it at its address specified in Section 10.02. Nothing in this
Section 10.10 shall affect the right of the parties hereto to serve legal
process in any other manner permitted by law.
SECTION 10.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO,
OR CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED OR DELIVERED PURSUANT
HERETO.
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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 CXP FUNDING, LLC
By:
---------------------------
Title:
0000 X. Xxxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx Xxxxxx
Facsimile Number: (000) 000-0000
INVESTOR: ATLANTIC ASSET SECURITIZATION CORP.
By: Credit Lyonnais New York
Branch, as Attorney-in-Fact
By
-----------------------
Vice President
c/o Lord Securities Corporation
2 Wall Street, 19th Floor
New York, N.Y. 10006
Attention: Xxxxxx Xxxxxxx
Facsimile No. (000)000-0000
AGENT: CREDIT LYONNAIS NEW YORK BRANCH,
as Agent
By
-------------------------------
Vice President
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, X.X. 00000
Attention: Xxxx Xxxxxx
Facsimile No. (000)000-0000
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BANK: CREDIT LYONNAIS NEW YORK BRANCH
By:
----------------------------
Percentage Interest: 100%
1301 Avenue of the Americas
New York, N.Y. 10019
Attention: Xxxx Xxxxxx
Facsimile No. (000)000-0000
PARENT AND CENTEX CONSTRUCTION PRODUCTS, INC.
COLLECTION AGENT:
By:
--------------------------
Title:
0000 X. Xxxxxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxxxxx
Facsimile Number: (000) 000-0000
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