EXECUTION COPY
[CANADIAN SUBSIDIARIES]
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RECEIVABLES TRANSFER AND ADMINISTRATION AGREEMENT
Dated as of September 19, 1997
Among
COLTEC INDUSTRIES INC
as Sellers' Agent
certain Canadian subsidiaries and affiliates of
Coltec Industries Inc
as Sellers
and
COLTEC NORTH CAROLINA INC
as Purchaser
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS........................................................1
SECTION 1.01. Certain Defined Terms..................................1
SECTION 1.02. Other Terms............................................6
ARTICLE II AMOUNTS AND TERMS OF PURCHASES....................................6
SECTION 2.01. Facility...............................................6
SECTION 2.02. Making Purchases.......................................6
SECTION 2.03. Collections; Purchase Price............................7
SECTION 2.04. Settlement Procedures..................................7
SECTION 2.05. Payments and Computations, Etc.........................8
SECTION 2.06. Annual Rates of Interest...............................9
ARTICLE III [reserved].......................................................9
ARTICLE IV REPRESENTATIONS AND WARRANTIES....................................9
SECTION 4.01. Representations and Warranties of the Sellers..........9
ARTICLE V COVENANTS ........................................................12
SECTION 5.01. Covenants of the Sellers..............................12
SECTION 5.02. Covenant of the Sellers and the Purchaser.............16
ARTICLE VI ADMINISTRATION AND COLLECTION....................................17
SECTION 6.01. Undertaking to Collect and Administer Receivables.....17
SECTION 6.02. Duties................................................17
SECTION 6.03. Certain Rights of the Purchaser.......................18
SECTION 6.04. Rights and Remedies...................................19
SECTION 6.05. Transfer of Records to Purchaser......................19
ARTICLE VII EVENTS OF TERMINATION...........................................20
SECTION 7.01. Events of Termination.................................20
SECTION 7.02 Individual Seller Termination.........................21
ARTICLE VIII INDEMNIFICATION.21
SECTION 8.01. Indemnities...........................................21
ARTICLE IX MISCELLANEOUS.....23
SECTION 9.01. Amendments, Etc.......................................23
SECTION 9.02. Notices, Etc..........................................24
SECTION 9.03. Binding Effect; Assignability.........................24
SECTION 9.04. Costs, Expenses and Taxes.............................24
SECTION 9.05. [reserved]............................................25
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SECTION 9.06. [reserved]............................................25
SECTION 9.07. Governing Law.........................................25
SECTION 9.08. Third Party Beneficiary...............................25
SECTION 9.09. Execution in Counterparts.............................26
EXHIBITS(a)
EXHIBIT A Form of Opinion of Counsel for the Sellers
EXHIBIT B Credit and Collection Policy
EXHIBIT C Lock-Box Banks
Attachment 1 - Form of Sale Assignment
SCHEDULES
Schedule 4.01(n) List of Tradenames
Schedule 5.01(b) Addresses of Sellers
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RECEIVABLES TRANSFER AND ADMINISTRATION AGREEMENT
RECEIVABLES TRANSFER AND ADMINISTRATION AGREEMENT, dated as of September
19, 1997 (this "Agreement"), by and among COLTEC INDUSTRIES INC, a Pennsylvania
corporation ("Coltec"), as agent for the Sellers (the "Sellers' Agent"), each of
the persons listed on the signature page to this Agreement under the heading
"Sellers" (each a "Seller" and collectively, the "Sellers") and COLTEC NORTH
CAROLINA INC, a North Carolina corporation (the "Purchaser").
PRELIMINARY STATEMENTS
1. Certain terms which are capitalized and used throughout this Agreement
(in addition to those defined above) are defined in Article I of this Agreement.
2. Each Seller has Receivables that it wishes to sell to the Purchaser, and
the Purchaser is prepared to purchase such Receivables on the terms set forth
herein.
3. The Purchaser wishes to engage each of the Sellers to perform certain
collection and administration duties with respect to the Receivables acquired by
the Purchaser from such Seller.
NOW, THEREFORE, 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):
Adverse Claim: means a lien, security interest, or other charge or encumbrance,
or any other type of preferential arrangement other than inchoate liens, such as
for taxes not yet due.
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 is a director or officer of such Person.
Alternate Base Rate: means a fluctuating interest rate per annum as shall be in
effect from time to time, which rate shall be at all times equal to the lower
of:
(a) the rate of interest announced publicly by Credit Lyonnais New York
Branch in New York, New York, from time to time as its prime rate, less 1.50%
and
(b) the Federal Funds Rate plus 0.50%.
Business Day: means any day on which banks are not authorized or required to
close in the cities of New York, New York; Charlotte, North Carolina; or
Xxxxxxx, Xxxxxxx, Xxxxxx.
Closing Date: means September 22, 1997.
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 all funds
deemed to have been received by the Seller or any other Person as a Collection
pursuant to Section 2.04, but excluding any amounts representing GST.
Contract: means an agreement between the Seller and an Obligor 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 March 24, 1992, as
amended and restated as of January 11, 1994 and as further amended and restated
as of December 18, 1996, supplemented or restated from time to time, among
Coltec Industries Inc, various banks, Bankers Trust Company, as administrative
agent, Bank of America Illinois, as documentation agent, and The Chase Manhattan
Bank, as syndication agent.
Credit and Collection Policy: means those receivables credit and collection
policies and practices of the Sellers in effect on the date of this Agreement
applicable to the Receivables and described in Exhibit B hereto, as modified in
compliance with this Agreement.
Defaulted Receivable: means a Receivable:
(i) as to which any payment, or part thereof, remains unpaid for 60
days (or 90 days, subject to receipt by the Sellers' Agent of the
Purchaser's written consent following revision by the Sellers of their
reporting systems to further specify the aging of the Receivables) 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(e); or
(iii) which, consistent with the Credit and Collection Policy, would
be written off as uncollectible.
Dilution: means, with respect to any Receivable, the aggregate amount of any
reductions or adjustments in the Outstanding Balance of such Receivable as a
result of any defective, rejected, returned, repossessed or foreclosed
merchandise or services or any cash discount or other adjustment or setoff.
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Discount Percentage: means, with respect to any Seller on any day prior to the
day on which the Sellers' Agent completes its initial fair market valuation
methodology, 2.50% and, thereafter, shall mean for each Fiscal Month the
percentage set forth in such fair market valuation methodology with respect to
such Seller, as adjusted periodically from time to time.
Event of Termination: has the meaning specified in Section 7.01.
Facility: means the commitment of the Purchaser to make Purchases of Receivables
from the Sellers pursuant to the terms of this Agreement.
Facility Termination Date: means the earlier of (i) the date of termination of
the Facility pursuant to Section 7.01 and (ii) the date which the Sellers' Agent
designates by at least two Business Days' notice to the Purchaser.
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 under the Sale Agreement from three federal funds brokers
of recognized standing selected by it.
Fiscal Month: means each period specified as a "Fiscal Month" by the Seller's
Agent to the Purchaser on a schedule provided as of the beginning of each fiscal
year of the Seller's Agent.
General Trial Balance: of a Seller on any date means such Seller's accounts
receivable trial balance (whether in the form of a computer printout, magnetic
tape or diskette) on such date, listing Obligors and the Receivables
respectively owed by such Obligors on such date together with the aged
Outstanding Balances of such Receivables, in form and substance satisfactory to
the Purchaser.
GST: means any tax imposed under Part IX of the Excise Tax Act (Canada) and any
other similar goods and services tax or value added tax or other sales tax
imposed by a Canadian province including Quebec Sales Tax.
Indemnified Amounts: has the meaning specified in Section 8.01.
Lock-Box Account: means one or more accounts maintained for the purpose of
receiving Collections.
Lock-Box Agreement: means an agreement relating to a Lock-Box Account between a
Seller and any Lock-Box Bank in form and substance satisfactory to the Purchaser
(or its assignees or designees).
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Lock-Box Bank: means any of the banks or other financial institutions holding
one or more Lock-Box Accounts.
Long Term Contract: means any agreement between a Seller and an Obligor pursuant
to or under which such Obligor shall be obligated to pay for merchandise or
services from time to time, the term of which exceeds 12 months.
Monthly Report: means a report, in form and substance satisfactory to the
Purchaser, furnished by each Seller to the Purchaser pursuant to Section
6.02(b).
Obligor: means a Person obligated to make payments to a Seller pursuant to a
Contract.
Outstanding Balance: of any Receivable on any date means the outstanding
principal balance thereof on such date.
Person: means an individual, partnership, corporation (including a business
trust), joint stock company, limited liability company, trust, unincorporated
association, joint venture or other entity, or a government or any political
subdivision or agency thereof.
PPSA: The Personal Property Security Act (Ontario), as amended from time to
time.
Purchase: means a purchase by the Purchaser of Receivables from a Seller
pursuant to Article II.
Purchase Price: means, for any Receivable sold by a Seller during a Fiscal
Month, the product of (a) the Outstanding Balance of such Receivable on the date
such Receivable is sold to the Purchaser, and (b) the excess of 100% over the
Discount Percentage in effect for such Fiscal Month.
Purchased Receivable: means any Receivable which has been sold by a Seller
hereunder.
Receivable: means the indebtedness, excluding any amounts due that represent
GST, of any Obligor resulting from the provision or sale of merchandise or
services by a Seller under a Contract, and includes the right to payment of any
interest or finance charges and other obligations of such Obligor with respect
thereto provided, however that no Specified Boeing Receivable may at any time
constitute a Receivable.
Related Security: means with respect to any Receivable:
(i) all of the applicable 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 Contract
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related to such Receivable or otherwise, together with all financing
statements signed by an Obligor describing any collateral securing such
Receivable;
(iii) all guaranties, proceeds from insurance policies 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;
(iv) the Contract and all other books, records and other information
(including, without limitation, computer programs, tapes, discs, punch
cards, data processing software and related property and rights) relating
to such Receivable and the related Obligor to the extent assignable or
licensable under the related contract or license and applicable law; and
(v) rights to payment under Long Term Contracts.
Sale Agreement: means that certain Receivables Purchase Agreement, dated as of
the date hereof, among CNC Finance LLC, as seller, Atlantic Asset Securitization
Corp., as a purchaser, The Industrial Bank of Japan, Limited, Lloyds Bank PLC,
The Sumitomo Bank, Limited, Credit Lyonnais New York Branch, individually and as
agent, and the Sellers' Agent, as collection agent, as amended or restated from
time to time.
Securitized Receivable: means any Purchased Receivables that are transferred by
the Purchaser to CNC Finance LLC under the Receivables Purchase and Contribution
Agreement, dated as of the date hereof, by and between the Purchaser and CNC
Finance LLC and, with respect to which Receivables, CNC Finance LLC sells,
transfers or grants a security interest, or otherwise transfers an interest, in
such Purchased Receivables in connection with a securitization transaction.
Settlement Date: means the thirteenth Business Day of each Fiscal Month (or if
such day is not a Business Day, the immediately succeeding Business Day);
provided, however, that following the occurrence of an Event of Termination,
Settlement Dates shall occur on such days as are selected from time to time by
the Purchaser or its designee in a written notice to each Seller.
Specified Boeing Receivable: means any indebtedness of The Boeing Company
("Boeing") owed to Xxxxxxx Aerospace Ltd., now Coltec Aerospace Canada Ltd.
("Xxxxxxx") that is subject to the terms and conditions of that certain Security
Agreement, dated as of September 26, 1988, by and between Boeing and Xxxxxxx.
SECTION 1.02 Other Terms.
All accounting terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles.
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ARTICLE II
AMOUNTS AND TERMS OF PURCHASES
SECTION 2.01 Facility.
On the terms and conditions hereinafter set forth and without recourse
(except to the extent as is specifically provided herein), the Purchaser agrees
to purchase Receivables from the Sellers as such Receivables arise during the
period from the date hereof to the Facility Termination Date.
SECTION 2.02 Making Purchases.
(a) On the Closing Date, each Seller hereby sells, transfers, absolutely
assigns, sets-over and conveys to the Purchaser all Receivables owned by such
Seller as of the close of business on the Business Day immediately preceding the
Closing Date. Each Seller hereby agrees, on each Business Day occurring after
the Closing Date and prior to the Facility Termination Date, to sell, transfer,
absolutely assign, set-over and convey to the Purchaser all Receivables owned by
such Seller as of the close of business on the immediately preceding Business
Day. Each Seller and the Purchaser shall enter into a certificate of assignment
(the "Sale Assignment"), dated as of the date hereof, in the form of Attachment
1 hereto, evidencing such sale, transfer, absolute assignment, set-over and
conveyance of such Receivables.
(b) Upon the sale, transfer, absolute assignment, set-over and conveyance
of the Purchased Receivables the ownership of each such Receivable shall be
vested in the Purchaser and no Seller shall take any action inconsistent with
such ownership and shall not claim any ownership interest in any such Purchased
Receivable.
(c) Each Seller shall indicate in its records that ownership of each
Purchased Receivable is held by the Purchaser or its assignee. In addition, each
Seller shall respond to any inquiries with respect to ownership of a Purchased
Receivable by stating that it is no longer the owner of such Receivable and that
ownership of such Purchased Receivable is held by the Purchaser or its assignee.
(d) All payments of the Purchase Price of any Receivable payable in
Canadian dollars shall be made in Canadian dollars.
SECTION 2.03 Collections; Purchase Price.
(a) On the Business Day following the Closing Date, the Purchaser shall pay
each Seller an amount equal to the Purchase Price for all Receivables owned by
such Seller as of the close of business on the last Business Day of the Seller's
August Fiscal Month and sold to the Purchaser on the Closing Date. On each
Settlement Date, (i) each Seller shall deposit into an account of the Purchaser
or the Purchaser's assignee all Collections of Purchased Receivables
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received during the related Fiscal Month and then held by the Seller, and (ii)
the Purchaser shall pay each Seller in respect of all Receivables sold,
transferred, absolutely assigned, set-over and conveyed by such Seller to the
Purchaser during the immediately preceding Fiscal Month (except for the first
Settlement Date, which shall relate only to Receivables sold, transferred,
absolutely assigned, set-over and conveyed after the Closing Date) an amount
equal to the aggregate Purchase Price of such Receivables. Each party's
obligation to make payment of any amount under this Section 2.03(a) will be
automatically satisfied and discharged and, if the aggregate amount that would
otherwise have been payable by one party exceeds the aggregate amount that would
otherwise have been payable by the other party, replaced by an obligation upon
the party by whom the larger aggregate amount would have been payable to pay to
the other party the excess of the larger aggregate amount over the smaller
aggregate amount.
(b) In the event that the Sellers' Agent believes that amounts which are
not Collections of Purchased Receivables have been deposited into an account of
the Purchaser or the Purchaser's assignee, the Sellers' Agent shall so advise
the Purchaser and, on the Business Day following such identification, the
Purchaser shall remit, or shall cause to be remitted, to the Sellers' Agent for
the account of the applicable Seller, all amounts so deposited which are
identified, to the Purchaser's satisfaction, as not being Collections of
Receivables which are Purchased Receivables. Any amounts representing GST or
collections of any Specified Boeing Receivable deposited into an account of the
Purchaser or Purchaser's assignee shall be held in trust for the applicable
Seller.
SECTION 2.04 Settlement Procedures.
(a) If on any day the Outstanding Balance of any Purchased Receivable is
reduced or adjusted as a result of any defective, rejected, returned,
repossessed or foreclosed merchandise or services or any cash discount or other
similar adjustment made by a Seller, or any set-off or dispute in respect of any
claim by the Obligor thereof against a Seller (whether such claim arises out of
the same or a related transaction or an unrelated transaction but excluding
adjustments, reductions or cancellations in respect of such Obligor's
bankruptcy, insolvency or similar event), such Seller shall be deemed to have
received on such day a Collection of such Purchased Receivable in the amount of
such reduction or adjustment.
(b) Upon discovery by a Seller or the Purchaser of a breach of any of the
representations and warranties made by such Seller in Section 4.01(j) with
respect to any Transferred Receivable transferred by such Seller, such party
shall give prompt written notice thereof to the other party, as soon as
practicable and in any event within three Business Days following such
discovery. If such breach cannot be cured, such Seller shall, upon not less than
two Business Days' notice from the Purchaser or its assignee or designee,
repurchase such Transferred Receivable on the next succeeding Settlement Date
for a repurchase price equal to the outstanding balance of such Transferred
Receivable (which shall be calculated excluding the amount of the related GST).
Each repurchase of a Transferred Receivable shall include the Related Security
with respect to such Transferred Receivable. The proceeds of any such repurchase
shall be deemed to be a Collection in respect of such Transferred Receivable.
Such
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Seller shall pay to the Purchaser on or prior to the next Settlement Date the
repurchase price required to be paid pursuant to this subsection.
(c) Except as stated in subsections (a) or (b) of this Section 2.04 or as
otherwise required by law or the underlying Contract, all Collections from an
Obligor of any Purchased Receivable 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.
SECTION 2.05 Payments and Computations, Etc.
(a) All amounts to be paid or deposited by any Party hereunder shall be
paid or deposited no later than 11:00 A.M. (New York City time) on the day when
due in same day funds to the account specified by the recipient of such funds to
the payor as set forth in a written notice from time to time.
(b) Each Seller shall, to the extent permitted by law, pay to the Purchaser
interest on any amount not paid or deposited by such Seller (whether as Seller
or otherwise) when due hereunder at an interest rate per annum equal to 2.0% per
annum above the Alternate Base Rate, payable on demand.
(c) All computations of interest and all computations of fees hereunder
shall be made on the basis of a year of 360 days for the actual number of days
(including the first but excluding the last day) elapsed. Whenever any payment
or deposit to be made hereunder shall be due on a day other than a Business Day,
such 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 2.06 Annual Rates of Interest.
For the purposes of the Interest Act (Canada), whenever interest payable
pursuant to this Agreement is calculated on the basis of a period other than a
calendar year (the "Interest Period"), each rate of interest determined pursuant
to such calculation expressed as an annual rate is equivalent to such rate as so
determined multiplied by the actual number of days in the calendar year in which
the same is to be ascertained and divided by the number of days in the Interest
Period.
ARTICLE III
[reserved]
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Representations and Warranties of the Sellers.
Each Seller represents and warrants as follows:
(a) Such Seller is a corporation duly incorporated, validly existing and in
good standing under the laws of its jurisdiction of incorporation, 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 such Seller of this
Agreement and the other documents to be delivered by it hereunder, including
such Seller's sale of Receivables hereunder and such Seller's use of the
proceeds of Purchases, (i) are within such Seller's corporate powers, (ii) have
been duly authorized by all necessary corporate action, (iii) do not contravene
(1) such Seller's charter or by-laws, (2) any law, rule or regulation applicable
to such Seller, (3) any contractual restriction binding on or affecting such
Seller or its property or (4) any order, writ, judgment, award, injunction or
decree binding on or affecting such Seller or its property, and (iv) do not
result in or require the creation of any Adverse Claim upon or with respect to
any of its properties (except for the transfer of such Seller's interest in the
Purchased Receivables pursuant to this Agreement). This Agreement has been duly
executed and delivered by such 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 such Seller of this Agreement or any
other document to be delivered by it hereunder other than the filing of
financing statements and similar documents as contemplated in Section
5.01(k)(i).
(d) This Agreement constitutes the legal, valid and binding obligation of
such Seller enforceable against such Seller in accordance with its terms, except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
(e) Each sale made pursuant to this Agreement will constitute a valid sale,
transfer, and assignment of the Purchased Receivables to the Purchaser,
enforceable against creditors of, and purchasers from, such Seller. Following
each such sale, such Seller shall have no remaining property interest in any
Purchased Receivable.
(f) The balance sheets of the Sellers' Agent and its consolidated
subsidiaries for the most recently ended fiscal year, and the related statements
of income and retained earnings of the Sellers' Agent and its consolidated
subsidiaries for such fiscal year, copies of which have been
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furnished to the Purchaser, fairly present the financial condition of the
Sellers' Agent and its subsidiaries as at the date of such balance sheets and
the results of the operations of the Sellers' Agent and its consolidated
subsidiaries for the period ended on such date, all in accordance with generally
accepted accounting principles consistently applied, and since the date of such
balance sheets there has been no material adverse change in the business,
operations, property or financial or other condition of such Seller.
(g) There are no actions, suits or proceedings pending or, to the best
knowledge of such Seller, threatened (i) with respect to this Agreement or any
documentation executed in connection herewith or the transactions contemplated
hereby, (ii) with respect to the Credit Agreement or (iii) that are reasonably
likely to materially and adversely affect the business, property, assets,
conditions (financial or otherwise) or prospects of Coltec Industries Inc or
Coltec Industries Inc and its Subsidiaries (as defined in the Sale Agreement)
taken as a whole. Such Seller is not in default with respect to any order of any
court, arbitration or governmental body, except for defaults that are not
material to the business or operation of Coltec Industries Inc and its
Subsidiaries (as defined in the Sale Agreement) taken as a whole.
(h) No proceeds of any Purchase 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.
(i) No transaction contemplated hereby requires compliance with any bulk
sales act or similar law.
(j) Each Purchased Receivable, together with the Related Security, is owned
(prior to its sale hereunder) by such Seller free and clear of any Adverse Claim
(other than any Adverse Claim arising solely as the result of any action taken
by the Purchaser). When the Purchaser makes a Purchase and when a Seller sells a
Receivable to the Purchaser, the Purchaser shall acquire a valid and perfected
first priority ownership or security interest of each such Purchased Receivable
and the Related Security and Collections with respect thereto free and clear of
any Adverse Claim (other than any Adverse Claim arising solely as the result of
any action taken by the Purchaser), and no effective financing statement or
other instrument similar in effect covering any Purchased Receivable, any
interest therein, the Related Security or Collections with respect thereto is on
file in any recording office except such as may be filed in favor of Purchaser
in accordance with this Agreement or in connection with any Adverse Claim
arising solely as the result of any action taken by the Purchaser.
(k) All written information and each exhibit, financial statement,
document, book, record or report furnished by such Seller to the Purchaser in
connection with this Agreement is accurate in all material respects as of its
date (except as otherwise disclosed in writing to the Purchaser at such time),
and no such document contains any untrue statement of a material fact or omits
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.
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(l) The principal place of business and chief executive office of such
Seller and the office where such Seller keeps its records concerning the
Purchased Receivables are located at the address or addresses referred to in
Section 5.01(b).
(m) The names and addresses of all the Lock-Box Banks, together with the
account numbers of the Lock-Box Accounts at such Lock-Box Banks, are specified
in Exhibit C (as the same may be updated from time to time pursuant to Section
5.01(h)), together with a notation indicating which such Lock-Box Accounts will
receive collections of Receivables that constitute Securitized Receivables.
(n) Except as specified in Schedule 4.01(n), such Seller is not known by
and does not use any tradename or doing-business-as name.
(o) The transfers of Purchased Receivables by such Seller to the Purchaser
pursuant to this Agreement, and all other transactions between such Seller and
the Purchaser, have been and will be made in good faith and without intent to
hinder, delay or defraud creditors of such Seller.
ARTICLE V
COVENANTS
SECTION 5.01 Covenants of the Sellers.
From the date hereof until the first day following the Facility Termination
Date on which all of the Purchased Receivables are either collected in full or
are written off the books of the Purchaser as uncollectible:
(a) Compliance with Laws, Etc. Each Seller will comply in all material
respects with all applicable laws, rules, regulations and orders and preserve
and maintain its corporate 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 existence,
rights, franchises, qualifications, and privileges would not materially
adversely affect the collectibility of the Purchased Receivables or the ability
of such Seller to perform its obligations under this Agreement.
(b) Offices, Records and Books of Account. Each Seller will keep its
principal place of business and chief executive office and the office where it
keeps its records concerning the Purchased Receivables at the addresses in
Schedule 5.01(b) hereto or, upon 30 days' prior written notice to the Purchaser,
at any other locations in jurisdictions where all actions required by Section
5.01(k) shall have been taken and completed. Each Seller also will maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing Purchased Receivables and
related Contracts in the event of the destruction of the originals thereof), and
keep and maintain all documents, books, records and
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other information reasonably necessary or advisable for the collection of all
Purchased Receivables (including, without limitation, records adequate to permit
the daily identification of each new Purchased Receivable and all Collections of
and adjustments to each existing Purchased Receivable). Each Seller shall make a
notation in its books and records, including its computer files, to indicate
which Receivables have been sold to the Purchaser hereunder.
(c) Performance and Compliance with Contracts and Credit and Collection
Policy. Each 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 Purchased Receivables, and
timely and fully comply in all material respects with the Credit and Collection
Policy in regard to each Purchased Receivable and the related Contract.
(d) Sales, Liens, Etc. Except for the sales of Receivables contemplated
herein, each 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, any Purchased Receivable, Related Security or Collections, or
upon or with respect to any account to which any Collections of any Purchased
Receivable are sent, or assign any right to receive income in respect thereof;
provided, however, that the provisions of this paragraph shall not prevent the
existence of inchoate liens for taxes, assessments and governmental charges or
claims not yet due or being contested in good faith and by appropriate
proceedings; notwithstanding anything to the contrary, the Purchaser understands
that each Seller will not segregate any Collections from other funds of such
Person and that such Collections will be commingled with other funds of such
Persons in the Sellers' Agent's cash management operations.
(e) Extension or Amendment of Purchased Receivables. Except as provided in
Section 6.02(c), each Seller will not extend, amend or otherwise modify the
terms of any Purchased Receivable.
(f) Change in Business or Credit and Collection Policy. No Seller will make
any change in either (i) the character of its business or (ii) its Credit and
Collection Policy if such change would impair the collectibility of the
Purchased Receivables.
(g) Audits. Each Seller will, from time to time during regular business
hours as requested by the Purchaser, permit the Purchaser and each Seller whose
Purchased Receivables at such time constitute Securitized Receivables will, from
time to time during regular business hours as requested by the Agent under the
Sale Agreement, permit the Agent under the Sale Agreement:
(i) to conduct an annual audit (or more frequently if an Event of
Termination occurs) of the Purchased Receivables, the Related Security and
the related books and records and collections systems of such Seller, the
first such audit by the Agent under the Sale Agreement shall occur prior to
Xxxxx 0, 0000,
(xx) semi-annually (or more frequently if an Event of Termination
occurs) to examine and make copies of and abstracts from all books, records
and documents
12
(including, without limitation, computer tapes and disks) in the possession
or under the control of the Seller relating to Purchased Receivables and
the Related Security, including, without limitation, the Contracts, and
(iii) semi-annually (or more frequently if an Event of Termination
occurs) to visit the offices and properties of such Seller for the purpose
of examining such materials described in clause (ii) above, and to discuss
matters relating to Purchased Receivables and the Related Security or such
Seller's performance hereunder with any of the officers or employees of
such Seller having knowledge of such matters.
(h) Change in Payment Instructions to Obligors. Each Seller whose
Receivables constitute Securitized Receivables will not add or terminate any
bank or bank account as a Lock-Box Bank or Lock-Box Account from those listed in
Exhibit C to this Agreement, or make any change in its instructions to Obligors
regarding payments to be made to any Lock-Box Bank, unless the Purchaser shall
have received notice of such addition, termination or change (including an
updated Exhibit C) and executed copies of Lock-Box Agreements with each new
Lock-Box Bank or with respect to each new Lock-Box Account.
(i) Deposits to Lock-Box Accounts. Each Seller of Receivables that
constitute Securitized Receivables will deposit, or cause to be deposited, all
Collections of Purchased Receivables that constitute Securitized Receivables
into Lock-Box Accounts, and such 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 Purchased Receivables that constitute
Securitized Receivables; provided, however, that notwithstanding the foregoing,
failure to comply with the provisions hereof prior to December 19, 1997 shall
not be a breach of this subsection (i); provided, further, however that cash
collections representing payment of GST and/or Specified Boeing Receivables may
at any time be credited or deposited to any Lock-Box Account; provided, however
that any such amount so credited or deposited shall be held in trust for the
applicable Seller.
(j) Marking of Records. At its expense, each Seller will xxxx its master
data processing records evidencing Purchased Receivables with a legend
evidencing or otherwise xxxx its records to indicate that such Purchased
Receivables have been sold in accordance with this Agreement.
(k) Further Assurances.
(i) Each Seller agrees from time to time, at its expense, promptly to
execute and deliver all further instruments and documents, and to take all
further actions, that may be necessary or desirable, or that the Purchaser
or its assignee may reasonably request, to perfect, protect or more fully
evidence the sale of Receivables under this Agreement, or to enable the
Purchaser or its assignee to exercise and enforce its respective rights and
remedies under this Agreement. Without limiting the foregoing, such Seller
will, upon the request of the Purchaser or its assignee, (x) execute and
file such financing or continuation statements, or amendments thereto, and
such other instruments and
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documents, that may be necessary or desirable to perfect, protect or
evidence such Purchased Receivables; and (y) deliver to the Purchaser
copies of all Contracts (other than Long Term Contracts) relating to the
Purchased Receivables and all records relating to such Contracts and the
Purchased Receivables, whether in hard copy or in magnetic tape or diskette
format (which if in magnetic tape or diskette format shall be compatible
with the Purchaser's computer equipment).
(ii) Each Seller authorizes the Purchaser or its assignee to file
financing or continuation statements, and amendments thereto and
assignments thereof, relating to the Purchased Receivables and the Related
Security, the related Contracts and the Collections with respect thereto
without the signature of such Seller where permitted by law. A photocopy or
other reproduction of this Agreement shall be sufficient as a financing
statement where permitted by law.
(iii) Each Seller shall perform its obligations under the Contracts
related to the Purchased Receivables to the same extent as if the Purchased
Receivables had not been sold or transferred.
(l) Reporting Requirements. The Sellers' Agent will provide to the
Purchaser the following:
(i) as soon as available and in any event within 45 days after the end
of the first three quarters of each fiscal year of the Sellers' Agent
balance sheets of the Sellers' Agent and its consolidated subsidiaries as
of the end of such quarter and statements of income and retained earnings
of the Sellers' Agent and its 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 of the Sellers' Agent;
(ii) as soon as available and in any event within 90 days after the
end of each fiscal year of the Sellers' Agent, a copy of the Annual Report
of Form 10-K for such year for the Sellers' Agent and its consolidated
subsidiaries, containing financial statements for such year audited by
Xxxxxx Xxxxxxxx & Co. or other nationally recognized independent public
accountants;
(iii) as soon as possible and in any event within five days after the
occurrence of each Event of Termination or event that, but for notice or
the lapse of time or both, would constitute an Event of Termination, a
statement of the chief financial officer of the Sellers' Agent setting
forth details of such Event of Termination or event that, but for notice or
the lapse of time or both, would constitute an Event of Termination and the
action that the Sellers' Agent has taken and proposes to take with respect
thereto;
(iv) promptly after the filing or receiving thereof, copies of all
reports and notices that the Sellers' Agent or any Affiliate files under
applicable legislation or that the Sellers' Agent or any Affiliate receives
from any applicable regulatory authority or from any multiemployer plan to
which the Sellers' Agent or any Affiliate is or was, within the
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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
Sellers' Agent and/or any such Affiliate in excess of $1,000,000;
(v) at least ten Business Days prior to any change in each Seller's
name, a notice setting forth the new name and the effective date thereof;
and
(vi) such other information respecting the Purchased Receivables or
the condition or operations, financial or otherwise, of the Sellers as the
Purchaser may from time to time reasonably request.
(m) Each Seller will: (i) maintain separate corporate records and books of
account from those of the Purchaser and CNC Finance LLC; (ii) conduct its
business from an office separate from that of the Purchaser and CNC Finance LLC
(which office may be located in identifiable space within the headquarters of
Coltec Industries Inc or any of its affiliates); (iii) ensure that all oral and
written communications, including without limitation, letters, invoices,
purchase orders, contracts, statements and applications, will be made solely in
its own name; (iv) have stationery and other business forms and a mailing
address and a telephone number separate from those of the Purchaser or CNC
Finance LLC; (v) not hold itself out as having agreed to pay, or as being liable
for, the obligations of the Purchaser or CNC Finance LLC; (vi) continuously
maintain as official records the resolutions, agreements and other instruments
underlying the transactions contemplated by this Agreement; and (vii) disclose
on its annual financial statements the effects of the transactions contemplated
by this Agreement in accordance with generally accepted accounting principles.
SECTION 5.02 Covenant of the Sellers and the Purchaser.
The Sellers and the Purchaser have structured this Agreement with the
intention that each Purchase of Receivables hereunder be treated as a sale of
such Receivables by the Sellers to the Purchaser for all purposes. The Sellers
and the Purchaser shall record each Purchase as a sale or purchase, as the case
may be, on its books and records, and reflect, to the extent required or
permitted by applicable law and/or accounting rules, each Purchase in its
financial statements and tax returns as a sale or purchase, as the case may be.
In the event that, contrary to the mutual intent of the Sellers and the
Purchasers, any Purchase of Receivables hereunder is not characterized as a
sale, the Sellers shall, effective as of the date hereof, be deemed to have
granted (and the Sellers hereby do grant) to the Purchaser a first priority
security interest in and to any and all Purchased Receivables, Related Security
and the proceeds thereof to secure the repayment of all amounts advanced to the
Sellers hereunder with accrued interest thereon, and this Agreement shall be
deemed to be a security agreement.
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ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01 Undertaking to Collect and Administer Receivables.
In consideration of the purchase by the Purchaser of Receivables hereunder
and the payment to each Seller purchase price therefor, each Seller agrees to
service, administer and collect the portion of the Purchased Receivables owned
by the Purchaser that was acquired from such Seller.
SECTION 6.02 Duties.
(a) Each Seller shall take or cause to be taken all such actions as may be
necessary or advisable to collect each Purchased Receivable that was sold by it
to the Purchaser hereunder from time to time, all in accordance with applicable
laws, rules and regulations, with reasonable care and diligence, in accordance
with the Credit and Collection Policy and subject to the directions of the
Purchaser or its designees. In performing such duties, each Seller shall,
subject to the directions of the Purchaser or its designee, exercise the same
care and apply the same policies as it would exercise and apply if it owned such
Purchased Receivables and shall act in the best interests of the Purchaser and
its assignees.
(b) On or before the tenth Business Day after the end of each Fiscal Month,
each Seller shall prepare and forward to the Purchaser (i) a Monthly Report,
relating to all then outstanding Purchased Receivables sold by such Seller
hereunder and the Related Security and Collections with respect thereto, in each
case, as of the close of business of such Seller on the last day of the
immediately preceding Fiscal Month, and (ii) if requested by the Purchaser, a
listing by Obligor of all Purchased Receivables, together with an aging report
of such Purchased Receivables.
(c) Without the prior approval of the Purchaser or its designee, no Seller
may extend the maturity or adjust the Outstanding Balance of any Purchased
Receivable that was sold by it to the Purchaser hereunder or amend or otherwise
modify the terms of any Purchased Receivable that was sold by it to the
Purchaser hereunder.
(d) Each Seller shall retain for the benefit of the Purchaser and shall
hold in trust for the Purchaser, all documents, instruments and records
(including, without limitation, computer tapes or disks) which evidence or
relate to Purchased Receivables sold by such Seller hereunder.
(e) Each Seller shall retain any cash collections or other cash proceeds
received by it with respect to Receivables not constituting Purchased
Receivables sold by it hereunder, unless such Collections or proceeds related to
Purchased Receivables sold by a different Seller, in which case, such
collections or proceeds shall constitute Collections of such Purchased
Receivables and shall be forthwith paid to the Purchaser. Each Seller shall
retain or promptly remove from the Lockbox Accounts all cash collections
representing payment of GST or a
16
Specified Boeing Receivable and shall timely make payment of all GST when due to
applicable tax authorities.
(f) No Seller shall have the authority to act on behalf of the Purchaser or
its designee except as is expressly conferred herein; provided, however, that no
Seller shall have the authority to contract in the name of the Purchaser or its
designees.
(g) Each Seller shall, at the request of the Sellers' Agent or the
Purchaser or its successors and assigns, separately state in each Monthly Report
all Receivables that are denominated in United States dollars and all
Receivables that are denominated in Canadian dollars.
SECTION 6.03 Certain Rights of the Purchaser.
(a) The Purchaser may, at any time, give notice of ownership and/or direct
the Obligors of Purchased Receivables and any Person obligated on any Related
Security, or any of them, that payment of all amounts payable under any
Purchased Receivable shall be made directly to the Purchaser or its designee.
Each Seller hereby transfers to the Purchaser (and its assigns and designees)
the exclusive ownership and control of the Lock-Box Accounts maintained by such
Seller for the purpose of receiving Collections.
(b) Each Seller shall, at any time upon the Purchaser's request and at such
Seller's expense, give notice of such ownership to each Obligor of Purchased
Receivables and direct that payments of all amounts payable under such Purchased
Receivables be made directly to the Purchaser or its designee.
(c) At the Purchaser's request and at each Seller's expense, each Seller
shall (x) assemble all of the documents, instruments and other records
(including, without limitation, computer tapes and disks) that evidence or
relate to the Purchased Receivables acquired from such Seller, and the related
Contracts (excluding the Long Term Contracts themselves) and Related Security,
or that are otherwise necessary or desirable to collect the Purchased
Receivables, and shall make the same available to the Purchaser at a place
selected by the Purchaser, and (y) segregate all cash, checks and other
instruments received by it from time to time constituting Collections of such
Purchased Receivables in a manner acceptable to the Purchaser and, promptly upon
receipt, remit all such cash, checks and instruments, duly endorsed or with duly
executed instruments of transfer, to the Purchaser or its designee. The
Purchaser shall also have the right to make copies of all such documents,
instruments and other records at any time.
(d) At the Purchaser's request and at each Seller's expense, each Seller
shall (x) assemble all of the documents, instruments and other records
(including, without limitation, computer tapes and disks), maintained by such
Seller that relate to the Purchased Receivables, and the related Contracts
(excluding the Long Term Contracts themselves) and Related Security, and shall
make the same available to the Purchaser at a place selected by the Purchaser,
and (y) segregate all cash, checks and other instruments received by it from
time to time constituting
17
Collections of Purchased Receivables in a manner acceptable to the Purchaser
and, promptly upon receipt, remit all such cash, checks and instruments, duly
endorsed or with duly executed instruments of transfer, to the Purchaser or its
designee. The Purchaser shall also have the right to make copies of all such
documents, instruments and other records at any time.
SECTION 6.04 Rights and Remedies.
(a) If a Seller fails to perform any of its obligations under this
Agreement, the Purchaser may (but shall not be required to) itself perform, or
cause performance of, such obligation, and, if such Seller fails to so perform,
the costs and expenses of the Purchaser incurred in connection therewith shall
be payable by such Seller, as provided in Section 8.01 or Section 9.04 as
applicable.
(b) Each Seller shall perform all of its obligations under the Contracts
related to the Purchased Receivables to the same extent as if such Seller had
not sold Receivables hereunder and the exercise by the Purchaser of its rights
hereunder shall not relieve such Seller from such obligations or its obligations
with respect to the Purchased Receivables. The Purchaser shall not have any
obligation or liability with respect to any Purchased Receivables or related
Contracts, nor shall the Purchaser be obligated to perform any of the
obligations of such Seller thereunder.
SECTION 6.05 Transfer of Records to Purchaser.
(a) Each Purchase of Receivables hereunder shall include the transfer to
the Purchaser of all of the Seller's right and title to and interest in the
records relating to such Receivables.
(b) Each Seller shall take such action requested by the Purchaser, from
time to time hereafter, that may be necessary or appropriate to ensure that the
Purchaser has an enforceable ownership interest in the records relating to the
Purchased Receivables.
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01 Events of Termination.
If any of the following events ("Events of Termination") shall occur and be
continuing:
(a) The Sellers' Agent shall fail (i) to transfer to the Purchaser when
requested any rights, pursuant to this Agreement, which the Sellers' Agent then
has and such failure shall have a material adverse effect upon the interest of
the Purchaser and shall remain unremedied for thirty (30) days after written
notice thereof shall have been given to the Sellers' Agent by the Purchaser, or
(ii) to make any payment required under Section 2.04(a) or 2.04(b); or
18
(b) Any representation or warranty made or deemed made by a Seller (or any
of its officers) under or in connection with this Agreement or any written
information or report delivered by a Seller pursuant to this Agreement shall
prove to have been incorrect or untrue in any material respect when made or
deemed made or delivered and such breach shall have a material adverse effect
upon the interest of the Purchaser and shall remain unremedied for thirty (30)
days after written notice thereof shall have been given to the Sellers' Agent by
the Purchaser; or
(c) A Seller shall fail to perform or observe any other term, covenant or
agreement contained in this Agreement on its part to be performed or observed
and any such failure shall remain unremedied for thirty (30) days after written
notice thereof shall have been given to the Sellers' Agent by the Purchaser (or,
with respect to a failure to deliver the Monthly Report pursuant to this
Agreement, such failure shall remain unremedied for five days, without a
requirement for notice) and such failure shall have a material adverse effect on
the interest of the Purchaser; or
(d) Any Purchase of Receivables hereunder, the Related Security and the
Collections with respect thereto shall for any reason cease to constitute valid
and perfected ownership interest or security interest in such Purchased
Receivables, Related Security and Collections free and clear of any Adverse
Claim; or
(e) A Seller or any of its subsidiaries 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 a Seller or any
of its subsidiaries 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 it (but not instituted by it), either such proceeding shall
remain undismissed or unstayed for a period of sixty (60) 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, it or for any substantial part of its
property) shall occur; or the Seller or any of its subsidiaries shall take any
corporate action to authorize any of the actions set forth above in this
subsection (e); or
(f) The occurrence of an Event of Default under the Credit Agreement and
such Event of Default shall remain unremedied for five (5) days after written
notice thereof shall have been given to the Sellers' Agent by the Purchaser; or
(g) An Event of Termination shall have occurred under the Sale Agreement;
then, and in any such event, the Purchaser may, by notice to the Sellers' Agent,
declare the Facility Termination Date to have occurred (in which case the
Facility Termination Date shall be deemed to have occurred); provided, that,
automatically upon the occurrence of any event
19
(without any requirement for the passage of time or the giving of notice)
described in paragraph (e) of this Section 7.01, the Facility Termination Date
shall occur. Upon any such declaration or designation or upon such automatic
termination, the Purchaser shall have, in addition to the rights and remedies
under this Agreement, all other rights and remedies with respect to the
Purchased Receivables provided after default under the PPSA and under other
applicable law, which rights and remedies shall be cumulative.
SECTION 7.02 Individual Seller Termination.
Except for any Seller constituting a division of Coltec Industries Inc, if
all of the outstanding capital stock of a Seller shall cease to be owned,
directly or indirectly, by Coltec Industries Inc, such Seller shall immediately
cease selling Receivables and the Purchaser shall immediately cease purchasing
such Seller's Receivables hereunder.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.01 Indemnities.
Without limiting any other rights which the Purchaser may have hereunder or
under applicable law, each Seller, severally and not jointly, and Coltec,
jointly and severally with each other Seller, hereby agree to indemnify the
Purchaser and its assigns and transferees (each, an "Indemnified Party") from
and against any and all damages, claims, losses, liabilities and related costs
and expenses, including reasonable attorneys' fees and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts"), awarded
against or incurred by any Indemnified Party arising out of or as a result of:
(i) any representation or warranty or statement made or deemed made by
such Seller (or any of its officers) under or in connection with this
Agreement, which shall have been incorrect in any material respect when
made;
(ii) the failure by such Seller to comply with any applicable law,
rule or regulation with respect to any Purchased Receivable sold by such
Seller; or the failure of any Purchased Receivable sold by such Seller or
the related Contract to conform to any such applicable law, rule or
regulation;
(iii) the failure to vest in the Purchaser absolute ownership of the
Receivables that are, or that purport to be, the subject of a Purchase from
such Seller under this Agreement and the Related Security and Collections
in respect thereof, free and clear of any Adverse Claim;
(iv) the failure of such Seller to have filed, or any delay in filing,
financing statements or other similar instruments or documents under the
PPSA of any applicable
20
jurisdiction or other applicable laws with respect to any Receivables that
are, or that purport to be, the subject of a Purchase sold by such Seller
under this Agreement and the Related Security and Collections in respect
thereof, whether at the time of any Purchase from such Seller or at any
subsequent time;
(v) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
that is, or that purports to be, the subject of a Purchase from such Seller
under this Agreement (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 except to the extent that such
dispute, claim, offset or defense results solely from actions or failures
to act of the Purchaser or its assigns;
(vi) any failure of such Seller to perform its duties or obligations
in accordance with the provisions hereof or to perform its duties or
obligations under any Contract related to a Purchased Receivable sold by
such Seller;
(vii) any products liability or other claim arising out of or in
connection with merchandise, insurance or services which are the subject of
any Contract related to a Purchased Receivable sold by such Seller;
(viii) the commingling by such Seller or an affiliate of such Seller
of Collections of Purchased Receivables sold by such Seller at any time
with other funds of such Seller or an Affiliate of such Seller;
(ix) any investigation, litigation or proceeding related solely to
this Agreement or the ownership of Purchased Receivables sold by such
Seller and the Related Security, or Collections with respect thereto or in
respect of any Purchased Receivable sold by such Seller and the Related
Security or related Contract, except to the extent any such investigation,
litigation or proceeding relates to a possible matter involving an
Indemnified Party for which neither such Seller nor any of its Affiliates
is at fault;
(x) any failure of such Seller to comply with its covenants contained
in Section 5.01;
(xi) any claim brought by any Person other than an Indemnified Party
arising from any activity by such Seller or any Affiliate of such Seller in
servicing, administering or collecting any Purchased Receivable sold by
such Seller; or
(xii) any Dilution with respect to any Purchased Receivable sold by
such Seller.
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It is expressly agreed and understood by the parties hereto (i) that the
foregoing indemnification is not intended to, and shall not, constitute a
guarantee of the collectibility or payment of the Purchased Receivables and (ii)
that nothing in this Section 8.01 shall require a Seller to indemnify any Person
(x) for Receivables which are not collected, not paid or uncollectible on
account of the insolvency, bankruptcy, or financial inability to pay of the
applicable Obligor, (y) for damages, losses, claims or liabilities or related
costs or expenses resulting from such Person's gross negligence or willful
misconduct, or (z) for any income taxes or franchise taxes incurred by such
Person arising out of or as a result of this Agreement or in respect of any
Purchased Receivable or any Contract.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Amendments, Etc.
No amendment or waiver of any provision of this Agreement or consent to any
departure by a Seller therefrom shall be effective unless in a writing signed by
the Purchaser and, in the case of any amendment, also signed by the Sellers'
Agent, and then such amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given. No failure on
the part of the Purchaser 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 9.02 Notices, Etc.
All notices and other communications hereunder shall, unless otherwise
stated herein, be in writing (which shall include electronic transmission) shall
be personally delivered, express couriered, electronically transmitted (whether
by facsimile, e-mail or otherwise) or mailed by registered or certified mail and
shall, unless otherwise expressly provided herein, be effective when received at
the address set forth under a party's 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.
SECTION 9.03 Binding Effect; Assignability.
(a) This Agreement shall be binding upon and inure to the benefit of the
Sellers, the Purchaser and their respective successors and assigns; provided,
however, that a Seller may not assign its rights or obligations hereunder or any
interest herein without the prior written consent of the Purchaser.
(b) This Agreement shall create and constitute the continuing obligations
of the parties hereto in accordance with its terms, and shall remain in full
force and effect until such time, after the Facility Termination Date, when all
of the Purchased Receivables are either
22
collected in full or become Defaulted Receivables; provided, however, that
rights and remedies with respect to any breach of any representation and
warranty made by the Seller pursuant to Article IV and the provisions of Article
VIII and Section 9.04 shall be continuing and shall survive any termination of
this Agreement.
SECTION 9.04 Costs, Expenses and Taxes.
(a) In addition to the rights of indemnification granted to the Purchaser
pursuant to Article VIII hereof, each Seller agrees to pay on demand all costs
and expenses in connection with the preparation, execution and delivery of this
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 Purchaser with respect thereto and with respect to advising the
Purchaser as to its rights and remedies under this Agreement, and each Seller
agrees to pay all costs and expenses, if any (including reasonable counsel fees
and expenses), in connection with the enforcement of this Agreement against such
Seller and the other documents to be delivered hereunder excluding, however, any
costs of enforcement or collection of Purchased Receivables.
(b) In addition, each Seller agrees to pay any and all stamp and other
taxes and fees payable in connection with the execution, delivery, filing and
recording of this Agreement or the other documents or agreements to be delivered
hereunder with respect to such Seller, and each Seller agrees to save each
Indemnified Party harmless from and against any liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes and fees.
SECTION 9.05 [reserved]
SECTION 9.06 [reserved]
SECTION 9.07 Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NORTH CAROLINA (WITHOUT GIVING EFFECT TO THE CONFLICT OF
LAWS PRINCIPLES THEREOF), EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE
PURCHASER'S OWNERSHIP OF OR SECURITY INTEREST IN THE RECEIVABLES OR REMEDIES
HEREUNDER, IN RESPECT THEREOF, ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER
THAN THE STATE OF NORTH CAROLINA.
SECTION 9.08 Third Party Beneficiary.
Each of the parties hereto hereby acknowledges that the Purchaser is
transferring the Securitized Receivables and certain of its rights under this
Agreement to CNC Finance LLC under the Receivables Purchase and Contribution
Agreement, dated as of the date hereof (the "CNCI Purchase Agreement") between
the Purchaser and CNC Finance LLC and that CNC Finance LLC is transferring an
interest in the Securitized Receivables and certain of its rights
23
under the CNCI Purchase Agreement pursuant to the Sale Agreement and each Seller
hereby consents to all such transfers and assignments. CNC Finance LLC and the
other parties to the Sale Agreement shall be third-party beneficiaries of and
shall, following the occurrence of an Event of Termination under the Sale
Agreement, be entitled to enforce the Purchaser's rights and remedies under this
Agreement solely with respect to the Securitized Receivables to the same extent
as if they were parties hereto, except to the extent specifically limited under
the terms of the CNCI Purchase Agreement or the Sale Agreement.
SECTION 9.09 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. Delivery of an executed
counterparty of a signature page to this Agreement by facsimile shall be
effective as delivery of a manually executed counterpart of this Agreement.
[Remainder of Page Intentionally Left Blank]
24
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.
SELLERS: COLTEC AEROSPACE CANADA LTD.
By:_____________________________________
Name:___________________________________
Title:__________________________________
Address:
________________________________________
Attention:______________________________
Facsimile No.: ( ) -
___ __ ____
Account Information:
____________________
XXXXXXX OF CANADA LTD.
By:_____________________________________
Name:___________________________________
Title:__________________________________
Address:
________________________________________
Attention:______________________________
Facsimile No.: ( ) -
___ ___ ____
Account Information:
____________________
PURCHASER: COLTEC NORTH CAROLINA INC
By:_____________________________________
Name:___________________________________
Title:__________________________________
Address:
3 Coliseum Centre
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Xx.,
Treasury Department
Facsimile No.: (000) 000-0000
SELLER'S AGENT: COLTEC INDUSTRIES INC
By:_____________________________________
Name:___________________________________
Title:__________________________________
Address:
3 Coliseum Centre
0000 Xxxx Xxxxxx Xxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Xx.,
Treasury Department
Facsimile No.: (000) 000-0000
EXHIBIT A
FORM OF OPINION OF COUNSEL FOR THE SELLERS
EXHIBIT B
CREDIT AND COLLECTION POLICY
EXHIBIT C
LOCK-BOX BANKS
Bank Name Contains Collections of
and Address Account No. Securitized Receivables
----------- ----------- -----------------------
Attachment 1
To
Receivables Transfer and
Administration Agreement
[FORM OF SALE ASSIGNMENT]
SALE ASSIGNMENT, dated as of ______________ ___ 19___, between [SELLER]
(the "Seller") and Coltec North Carolina Inc ("CNCI").
1. We refer to the Receivables Transfer and Administration Agreement, dated
as of September _, 1997, by and among Coltec Industries Inc, the Seller, certain
affiliates of Coltec Industries Inc and CNCI (the "Agreement"). All provisions
of the Agreement are incorporated herein by reference. All capitalized terms
shall have the meanings set forth in the Agreement.
2. The Seller does hereby sell, transfer, absolutely assign, set over and
convey to CNCI, without recourse, all right, title and interest of the Seller in
and to all Receivables from time to time arising and owned by the Seller.
3. The Seller does hereby make the representations and warranties referred
to in Section 4.01 of the Agreement with respect to each Purchased Receivable
with full force and effect as if fully set forth herein.
IN WITNESS WHEREOF, the parties have caused this Sale Assignment to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
[SELLER]
By:
-------------------------------------
Name:
Title:
COLTEC NORTH CAROLINA INC
By:
-------------------------------------
Name:
Title:
