Exhibit 10(a)
RECEIVABLES TRANSFER AGREEMENT
by and among
GGRC CORP.,
as Transferor,
GEORGIA GULF CORPORATION,
individually and
as Collection Agent,
and
BLUE RIDGE ASSET FUNDING CORPORATION
Dated as of March 10, 1998
TABLE OF CONTENTS
Page
----
ARTICLE I Definitions................................................. 1
SECTION 1.1 Certain Defined Terms....................................... 1
SECTION 1.2 Other Terms.................................................17
SECTION 1.3 Computation of Time Periods.................................18
ARTICLE II Transfers and Settlements...................................18
SECTION 2.1 Assignment and Conveyance; Facility.........................18
SECTION 2.2 Transfers...................................................18
SECTION 2.3 Selection of Tranche Periods and Tranche Rates..............20
SECTION 2.4 Discount, Fees and Other Costs and Expenses.................21
SECTION 2.5 Non-Liquidation Settlement and Reinvestment Procedures......22
SECTION 2.6 Liquidation Settlement Procedures...........................22
SECTION 2.7 Fees ......................................................23
SECTION 2.8 Protection of Company's Ownership Rights....................23
SECTION 2.9 General Settlement Procedures...............................24
SECTION 2.10 Payments and Computations, Etc..............................24
SECTION 2.11 Reports.....................................................25
SECTION 2.12 Increase in and Reduction of Facility Limit.................25
SECTION 2.13 Optional Retransfer.........................................25
ARTICLE III Representations and Warranties..............................25
SECTION 3.1 Representations and Warranties..............................25
SECTION 3.2 Reaffirmation of Representations and Warranties.............29
ARTICLE IV Conditions Precedent........................................30
SECTION 4.1 Conditions to Closing.......................................30
ARTICLE V Covenants...................................................32
SECTION 5.1 Reporting Obligations.......................................32
SECTION 5.2 Negative Covenants of the Transferor and Georgia Gulf.......35
ARTICLE VI Administration and Collections..............................37
SECTION 6.1 Appointment of Collection Agent; Collection Agent Fee.......37
SECTION 6.2 Duties of Collection Agent..................................37
SECTION 6.3 Rights After Designation of New Collection Agent............38
SECTION 6.4 Responsibilities of the Transferor and Georgia Gulf.........39
SECTION 6.5 Lock-Box Notices............................................39
ARTICLE VII Termination Events..........................................40
SECTION 7.1 Termination Events..........................................40
SECTION 7.2 Termination.................................................42
ARTICLE VIII Indemnification.............................................42
SECTION 8.1 Indemnities by the Transferor...............................42
SECTION 8.2 Tax Indemnification.........................................44
SECTION 8.3 Additional Costs............................................45
SECTION 8.4 Other Costs and Expenses....................................46
SECTION 8.5 Reconveyance Under Certain Circumstances....................47
ARTICLE IX Miscellaneous...............................................47
SECTION 9.1 Term of Agreement...........................................47
SECTION 9.2 Waivers; Amendments.........................................47
SECTION 9.3 Notices.....................................................47
SECTION 9.4 Governing Law; Submission to Jurisdiction; Integration......49
SECTION 9.5 Severability; Counterparts..................................49
SECTION 9.6 Assignments.................................................49
SECTION 9.7 Confidentiality.............................................49
SECTION 9.8 No Bankruptcy Petition Against the Company..................50
SECTION 9.9 Limited Recourse; Waiver of Setoff..........................50
SECTION 9.10 Tax Characterization of the Transactions Contemplated by
this Agreement........................................... 50
EXHIBITS
EXHIBIT A Form of Contract...........................................A-1
EXHIBIT B Credit Policy..............................................B-1
EXHIBIT C List of Lock-Box Banks.....................................C-1
EXHIBIT D Form of Lock-Box Notice....................................D-1
EXHIBIT E Form of Monthly Report.....................................E-1
EXHIBIT F Form of Tranche Selection Notice...........................F-1
EXHIBIT G List of Top Ten Obligors By Aging..........................G-1
EXHIBIT H List of Actions/Suits......................................H-1
EXHIBIT I Schedule of Location of Records............................I-1
EXHIBIT J Schedule of Corporate Names, Trade Names or Assumed Names..J-1
EXHIBIT K Form of Compliance Certificate.............................K-1
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RECEIVABLES TRANSFER AGREEMENT
RECEIVABLES TRANSFER AGREEMENT, dated as of March 10, 1998 (as amended,
supplemented or otherwise modified and in effect from time to time, this
"Agreement") between GGRC CORP., a Delaware corporation, as transferor (the
"Transferor"), GEORGIA GULF CORPORATION, a Delaware corporation ("Georgia
Gulf"), individually and as the initial collection agent (in such capacity, the
"Collection Agent") and BLUE RIDGE ASSET FUNDING CORPORATION, a Delaware
corporation (the "Company" or "Blue Ridge"), individually and as agent for and
on behalf of itself and any commercial paper funding conduit (each, a "Conduit")
or bank or liquidity bank, designated by the Administrative Agent.
PRELIMINARY STATEMENT
The Transferor desires to sell and assign, from time to time, undivided
percentage interests in the domestic accounts receivable generated in the normal
course of Georgia Gulf's business, and the Company desires to acquire such
undivided percentage interests, subject to the terms and conditions of this
Agreement. The Collection Agent has agreed to service, upon the terms and
conditions described herein, the accounts receivable sold to the Company.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Additional Costs" shall have the meaning specified in Section 8.3(a).
"Adjusted Dilution Ratio" shall mean the average Dilution Ratio
calculated for the 12 monthly Reporting Periods immediately preceding the date
of determination.
"Adjusted LIBOR" applicable to any Interest Period means a rate per
annum equal to the quotient obtained (rounded upwards, if necessary, to the next
higher 1/100th of 1%) by dividing (i) the applicable LIBOR for such Interest
Period by (ii) 1.00 minus the Eurodollar Reserve Percentage.
"Administration Fee" shall mean the fee payable by the Transferor to
Blue Ridge pursuant to Section 2.7 hereof, the terms of which are set forth in
the Fee Letter.
"Administrative Agent" shall mean Wachovia Bank, N.A. and its
successors and assigns.
"Advance Rate" shall mean the difference, expressed as a percentage, of
1.00 less the Required Reserve Factor.
"Adverse Claim" shall mean a lien, security interest, charge or
encumbrance, or other right, or claim or interest in, of or on any Person's
assets or properties in favor of any other Person.
"Affiliate" shall mean any Person directly or indirectly controlling,
controlled by, or under direct or indirect common control with, another Person
or a Subsidiary of such other Person. A Person shall be deemed to control
another Person if the controlling Person owns, directly or indirectly, 10% or
more of any class of voting securities of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the
management or policies of the controlled Person, whether through ownership of
stock or otherwise.
"Aggregate Net Investment" shall mean the sum of the amounts paid to
the Transferor for all Transfers less the aggregate amount of Collections (or
payments, if any, pursuant to the first sentence of Section 2.6) received and
applied by the Company to reduce such Aggregate Net Investment pursuant to
Sections 2.5 or 2.6; provided that the Aggregate Net Investment shall be
restored in the amount of any Collections so received and applied if at any time
the distribution of such Collections is rescinded or returned for any reason.
"Aggregate Unpaids" shall mean, at any time, an amount equal to the sum
of (i) the aggregate accrued and unpaid Discount with respect to all Tranche
Periods at such time, (ii) the Aggregate Net Investment at such time and (iii)
all other amounts owed (whether due or accrued) hereunder by the Transferor to
the Company at such time.
"Allocated Net Investment" shall mean, with respect to any Tranche
Period, the portion of the Aggregate Net Investment allocated to such Tranche
Period.
"Assets" shall have the meaning specified in Section 2.1.
"Bankruptcy Code" shall have the meaning specified in Section 3.1(m).
"Base Rate" means for any Base Rate Loan for any day, the rate per
annum equal to the higher as of such day of (i) the Prime Rate, or (ii) one-half
of one percent above the Federal Funds Rate. For purposes of determining the
Base Rate for any day, changes in the Prime Rate or the Federal Funds Rate shall
be effective on the date of each such change.
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"XX Xxxxxxx" shall mean a Tranche as to which Discount is calculated at
the Base Rate.
"BR Tranche Period" shall mean, with respect to a BR Tranche, prior to
the Termination Date, a period of up to thirty (30) days (which period shall be
equal to the number of calendar days by which the date of the related Transfer
precedes the related due date for such Receivable) commencing on a Business Day
selected by the Transferor pursuant to this Agreement, and after the Termination
Date or the occurrence of the event described in Section 7.1(e)(i) (exclusive of
any days of grace), at the Company's option pursuant to Section 2.3(b), up to
thirty (30) days. If such BR Tranche Period would end on a day which is not a
Business Day, such BR Tranche Period shall end on the next succeeding Business
Day.
"Business Day" shall mean (i) with respect to any matters relating to
the Eurodollar Rate, a day on which banks are open for business in New York, New
York and in Atlanta, Georgia and on which dealings in Dollars are carried on in
the London interbank market and (ii) for all other purposes, any day other than
a Saturday, Sunday or other day on which banking institutions or trust companies
in New York, New York or Atlanta, Georgia are authorized or obligated by law,
executive order or governmental decree to be closed.
"Capitalized Lease" of a Person shall mean any lease of property by
such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in accordance with GAAP.
"Closing Date" shall mean March 10, 1998.
"Collection Agent" or "Servicer" shall mean, at any time, the Person
then authorized pursuant to Section 6.1 to service, administer and collect
Receivables.
"Collection Agent Fee" shall have the meaning specified in Section 6.1.
"Collections" shall mean all payments (including Recoveries),
collections and other proceeds of Receivables, including all Finance Charges and
proceeds of all Residual Receivable Interests with respect to such Receivables
received by the Collection Agent in cash or cash equivalents with respect to
such Receivables, whether in the form of checks, wire transfers, ACH or
electronic entry, and any Collections of such Receivables deemed to have been
received pursuant to Section 2.9 hereof.
"Commercial Paper" shall mean the commercial paper promissory notes, if
any, issued by or on behalf of the Company or that fund the Company's purchase
of Assets in connection with a CP Tranche.
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"Concentration Limit" shall mean, at any time for any Obligor and its
Affiliates, subject to specific review and approval by the Company, from time to
time, as follows on any date of determination:
Obligor's Short-Term Maximum Allowable Concentration
Unsecured Credit Rating as a % of Receivables
----------------------- ---------------------
A-1 +/ P-1 10.0%
A-1 / P-1 8.0
A-2 / P-2 6.0
A-3 / P-3 3.0
Unrated or below
A-3/P-3 2.0
In the event the Obligor has split short-term unsecured ratings, the
Concentration Limit shall be calculated using the lowest of the ratings;
provided, however, that nothing contained in this definition shall be construed
to require more than one rating from a Rating Agency.
"Contract" shall mean any invoice in substantially the form of Exhibit
A hereto or any other written agreement, invoice or purchase order relating
thereto approved in writing by the Company, pursuant to, or under which, an
Obligor is obligated to pay for goods and services purchased or otherwise
obtained from Georgia Gulf.
"Coverage Amount" shall mean, at any time, the amount equal to the
product of (i) the Coverage Percentage at such time and (ii) the Aggregate Net
Investment at such time.
"Coverage Percentage" shall mean, at any time, a Percentage equal
to the sum of (i) 100% plus (ii) the Required Reserve Factor at such time.
"CP Rate" shall mean, with respect to any CP Tranche Period, the rate
equivalent to the rate (or if more than one rate, the weighted average of the
rates) at which Commercial Paper having a term equal to such CP Tranche Period
is sold by any placement agent or commercial paper dealer, as agreed between
each such dealer or agent and the Company, plus the amount of any placement
agent or commercial agent fees.
"CP Tranche" shall mean a Tranche as to which Discount is calculated at
a CP Rate.
"CP Tranche Period" shall mean, with respect to a CP Tranche, a period
of up to 270 days commencing on a Business Day requested by the Transferor
pursuant to Section 2.3. If such CP Tranche Period would end on a day which is
not a Business Day, such CP Tranche Period shall end on the preceding Business
Day.
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"Credit Agreement" shall mean that certain Credit Agreement, dated as
of March 30, 1995, between Georgia Gulf and The Chase Manhattan Bank N.A., as in
effect on the Closing Date, and for purposes of determining whether a Potential
Termination Event or Termination Event has occurred, such Credit Agreement as it
may from time to time be amended, supplemented, or otherwise modified and in
effect for the purposes of termination.
"Credit Policy" shall mean Georgia Gulf's credit and collections
policies, procedures and practices relating to its determination of the
creditworthiness of customers, extensions of credit to customers and collection
of the Receivables as attached hereto as Exhibit B and as such credit policies
may be modified from time to time in accordance with Section 5.2(c) hereof.
"Cut-off Date" shall mean the last business day of each monthly
Reporting Period, except that the Initial Cut-off Date shall be February 28,
1998.
"Days Sales Outstanding" shall mean, as of any day, an amount equal to
the product of (a) 91 multiplied by (b) the amount obtained by dividing the
aggregate outstanding balance of Total Receivables by the aggregate amount of
Sales less total Dilutive Credits created during the three fiscal months
immediately preceding the most recent Settlement Date.
"Default Ratio" shall mean, on any date of determination, the amount
(expressed as a percentage) equal to a fraction, the numerator of which is, (i)
the aggregate Total Receivables that became Defaulted Receivables during the
most recent monthly Reporting Period, divided by (ii) the Sales during the
Reporting Period four monthly Reporting Periods prior to the most recent monthly
Reporting Period.
"Default Horizon Ratio" shall mean the amount, expressed as a
percentage, obtained by dividing the Sales during the most recent four
Settlement Periods by the Net Pool Balance as of the most recent Cut-off Date.
"Defaulted Receivable" shall mean that portion of a Total Receivable:
(i) as to which the payment related thereto, remains unpaid for 91 days or more
from the original due date for such payment; (ii) as to which Georgia Gulf or
the Transferor has notice that the Obligor thereof has taken any action, or
suffered any event to occur, of the type described in Section 7.1(e) (as if
references to the Transferor therein refer to such Obligor, excluding any cure
period); or (iii) which, consistent with the requirements of the Credit Policy,
have been or should have been written off the Transferor's or Georgia Gulf's
books as uncollectible.
"Delinquency Ratio" shall mean, for any date of determination, the
ratio (expressed as a percentage) of (i) the aggregate Outstanding Balance of
all Delinquent
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Receivables, to (ii) the total amount of Sales generated two
months prior to such date of determination
"Delinquent Receivable" shall mean that portion of a Total Receivable
as to which the payment related thereto remains unpaid for more than 30 days,
but less than 91 days, from the due date for such payment.
"Dilution Horizon Ratio" shall mean the amount obtained by dividing (i)
aggregate Sales during the two most recent monthly Reporting Periods preceding
the date of determination by (ii) the aggregate Eligible Receivables outstanding
as of the most recent Cut-off Date.
"Dilution Ratio" shall mean the amount, expressed as a percentage,
obtained by dividing (i) aggregate Dilutive Credits incurred during the
Reporting Period immediately preceding the date of determination, by (ii) the
Sales for the Reporting Period immediately preceding the Reporting Period
referenced in clause (i) of this definition.
"Dilution Reserve" initially shall be zero, provided, however, if at
any time Georgia Gulf fails to meet the Minimum Credit Standard, the Dilution
Reserve will be the amount, expressed as a percentage, equal to the product of
(i) the Dilution Horizon Ratio and (ii) the sum of (x) 150% of the Adjusted
Dilution Ratio and (y) the Dilution Volatility Component.
"Dilution Volatility Component" shall mean an amount, expressed as a
percentage, equal to the product of (i) the difference between (x) the highest
average Dilution Ratio for any three consecutive monthly Reporting Periods
calculated in the Monthly Report for each of the 12 monthly Reporting Periods
preceding the date of determination, provided that, for the first two monthly
Reporting Periods following the Initial Cut-off Date, the Dilution Ratio used
for the purpose of this clause (x) for the first month, shall be the Dilution
Ratio for the first such month, and for the second month, shall be the average
Dilution Ratio for the first two months, and (y) the Adjusted Dilution Ratio;
multiplied by (ii) a fraction the numerator of which is equal to the amount
calculated under clause (i)(x) of this paragraph, and the denominator of which
is equal to the amount calculated in clause (i)(y) of this paragraph.
"Dilutive Credit" shall have the meaning provided in Section 6.2 of the
Receivables Purchase Agreement.
"Discount" shall mean, with respect to any Tranche Period:
(TR) x (TA) x (AD)
-----
(360)
Where:
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TR = the Tranche Rate applicable to such Tranche Period.
TA = the portion of the Aggregate Net Investment allocated to such Tranche
Period.
AD = the actual number of days in such Tranche Period.
provided, however, that no provision of this Agreement shall require the payment
or permit the collection of Discount in excess of the maximum permitted by
applicable law; and provided further, that Discount shall not be considered paid
by any distribution if at any time such distribution is rescinded or must be
returned for any reason.
"Discount Payable" shall mean, on any date of determination,(A) if
Georgia Gulf is the Collection Agent, the sum of the accrued and unpaid Discount
for all outstanding Tranche Periods and (B) if Georgia Gulf is not the
Collection Agent, or if a Termination Event has occurred and is continuing, the
sum of (i) the accrued and unpaid Discount for all outstanding Tranche Periods
and (ii) the aggregate Discount to become due (other than as specified in clause
(i)) with respect to all outstanding Tranche Periods.
"Dollars" or "$" shall mean the lawful currency of the United States of
America.
"Early Collection Fee" shall mean, for any Tranche Period (such Tranche
Period to be determined without regard to the last sentence in Section 2.3(a))
during which the Allocated Net Investment allocated to such Tranche Period is
reduced (other than by reason of a termination of a Tranche Period by the
Company pursuant to Section 7.2), the excess, if any, of (i) the additional
Discount that would have accrued during such Tranche Period if such reductions
had not occurred, minus (ii) the income, if any, received by the Company from
investing the proceeds of such reductions.
"Eligible Receivable" shall mean, at any date of determination, any
Receivable:
(i) which has been originated by Georgia Gulf in the ordinary
course of its business consistent with its Credit Policy and has been
sold to the Transferor pursuant to (and in accordance with) the
Receivables Purchase Agreement and to which the Transferor has good
title thereto and is the sole owner thereof, free and clear of all
Adverse Claims;
(ii) the Obligor of which is (A) a resident of, or (B)
organized and existing under, the laws of the United States of America,
is not an Affiliate of any of the parties hereto, and is not a
government or a governmental subdivision or agency;
(iii) which is not a Defaulted Receivable;
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(iv) which is not a Delinquent or Defaulted Receivable at the
time of the initial creation of an interest of the Company therein;
(v) which, according to the Contract related thereto, is
required to be paid in full within 60 days of the original billing date
thereof or, in the case of Contracts relating to the sale of polyvinyl
chloride resin, 90 days of the original billing date thereof;
(vi) an acquisition of which by the Company with the proceeds
of Commercial Paper would constitute a "current transaction" within the
meaning of Section 3(a)(3) of the Securities Act of 1933, as amended
(the "1933 Act");
(vii) which is either (A) an account receivable representing
all or part of the sales price of merchandise, insurance or services
which have been shipped or rendered, and meets the requirements of
Section 3(c)(5) of the Investment Company Act of 1940, as amended (the
"1940 Act") or (B) an "eligible asset" within the meaning of Rule 3a-7
promulgated under the 1940 Act;
(viii) which is an "account" or a "general intangible" within
the meaning of Section 9-106, or "chattel paper" within the meaning of
Section 9-105, of the Relevant UCC;
(ix) which is denominated and payable only in Dollars;
(x) which is evidenced by a Contract as to which, together
with such Receivable, is (A) in full force and effect and constitutes
the legal, valid and binding obligation of all related Obligors,
enforceable against such Obligors in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors', rights generally, (B) subject to no
rescission, setoff, counterclaim or other defense, and (C) the terms of
such Contract have not been extended, modified, waived or adjusted in
any manner except consistent with the Credit Policy and that will not
have a Material Adverse Effect on the collectibility of the related
Receivables or would cause such Receivables not to be Eligible
Receivables;
(xi) which, together with the Contract related thereto,
Georgia Gulf or the Transferor has no knowledge and has not received
notice that such Receivable contravenes or violates in any material
respect any laws, rules or regulations applicable thereto (including
laws, rules and regulations relating to truth in lending, fair credit
billing, fair credit reporting, interest and usury, equal credit
opportunity, fair debt collection practices and privacy);
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(xii) which arises under a Contract which (A) is freely
transferable and does not require the Obligor under such Contract to
consent to the transfer of the rights and duties of Georgia Gulf under
such contract (provided that, breach of any such consent provision
shall not be deemed to cause this condition to be breached unless such
breach causes the related Contract to be unenforceable) and (B) does
not contain a confidentiality provision that purports to restrict the
ability of the Company to exercise its rights under this Agreement,
including its right to review the Contract;
(xiii) which satisfies all applicable requirements of the
Credit Policy;
(xiv) the Obligor of which has been directed to make all
payments to a specified account of the Collection Agent with respect to
which there shall be a Lock-Box Agreement;
(xv) as to which the Company has not notified Georgia Gulf or
the Transferor in writing that such Receivable is not acceptable for
acquisition hereunder because of credit-related reasons determined in
the Company's sole discretion; and
(xvi) in which the Company has a perfected security interest
prior in right to the rights of any other Person.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the rules and regulations promulgated
thereunder.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Tranche
Period, a rate per annum determined by the Liquidity Bank to be equal to the sum
of (a) 0.45% and (b) Adjusted LIBOR for such Eurodollar Tranche Period.
"Eurodollar Tranche" shall mean a Tranche as to which Discount is
calculated at the Eurodollar Rate.
"Eurodollar Tranche Period" shall mean, with respect to a Eurodollar
Tranche, a period of one month commencing on a Business Day as requested by the
Transferor and agreed to by the Company pursuant to Section 2.3. If such
Eurodollar Tranche Period would end on a day which is not a Business Day, such
Eurodollar Tranche Period shall end on the next succeeding Business Day, unless
such extension would cause the last day of such Period to occur in the next
following calendar month, in which event the last day of such Period shall occur
on the next preceding Business Day.
"Excess Concentration Amount" shall mean, with respect to all Obligors,
the sum of all amounts by which the outstanding aggregate unpaid balance of all
Total Receivables of each Obligor exceeds the Concentration Limit related to
such Obligor,
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without counting for such purpose any Receivables of such Obligor
not deemed to be Eligible Receivables.
"Facility Limit" shall mean an amount equal to $50,000,000, as such
amount may be increased or reduced from time to time in accordance with
Section 2.12.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the next higher 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, provided that (i) if the day for which such rate is to be
determined is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the average
rate charged to the Administrative Agent on such day on such transactions, as
determined by the Administrative Agent.
"Fee Letter" shall mean the letter agreement between the Transferor and
the Company, as from time to time amended, supplemented or otherwise modified
and in effect.
"Finance Charges" shall mean, with respect to a Contract, any finance,
interest, late fee or similar charges owing by the Obligor pursuant to such
Contract.
"GAAP" shall mean United States generally accepted accounting
principles, consistently applied during the periods involved.
"Guaranty" of a Person shall mean any agreement by which such Person
assumes, guarantees, endorses, contingently agrees to purchase or provide funds
for the payment of, or otherwise becomes liable upon, the obligation of any
other Person, or agrees to maintain the net worth, working capital or other
financial condition of any other Person, or otherwise assures any creditor of
such other Person against loss, including, without limitation, any comfort
letter, administrative agreement or take-or-pay contract and shall include the
contingent liability of such Person in connection with any letter of credit or
bankers' or trade acceptance.
"Indebtedness" shall mean, as to any Person (determined without
duplication) any Indebtedness as such is defined and used in the Credit
Agreement.
"Indemnified Amounts" shall have the meaning specified in Section 8.1.
"Initial Settlement Date" shall mean March 11, 1998.
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"LIBOR" shall mean for each Eurodollar Tranche Period, the rate per
annum determined on the basis of the offered rate for deposits in Dollars of
amounts equal or comparable to the principal amount of such Eurodollar Tranche
offered for a term comparable to such Eurodollar Tranche Period, which rates
appear on the Telerate Page 3750 effective as of 11:00 A.M., London time, two
Business Days prior to the first day of such Eurodollar Tranche Period, provided
that if no such offered rates appear on such page, the "London Interbank Offered
Rate" or "LIBOR" for such Interest Period will be the arithmetic average
(rounded upwards, if necessary, to the next higher 1/100th of 1%) of rates
quoted by not less than two major banks in New York City, selected by the
Administrative Agent, at approximately 10:00 A.M., New York City time, two
Business Days prior to the first day of such Eurodollar Tranche Period, for
deposits in Dollars offered by leading European banks for a period comparable to
such Eurodollar Tranche Period in an amount comparable to the principal amount
of such Eurodollar Tranche.
"LIBOR Reserve Percentage" shall mean, with respect to any Eurodollar
Tranche Period, the maximum reserve percentage, if any, applicable to the
Liquidity Bank under Regulation D during such Eurodollar Tranche Period (or if
more than one percentage shall be applicable, the daily average of such
percentages for those days in such Eurodollar Tranche Period during which any
such percentage shall be applicable) for determining the Liquidity Bank's
reserve requirement (including any marginal, supplemental or emergency reserves)
with respect to liabilities or assets having a term comparable to such
Eurodollar Tranche Period consisting or included in the computation of
Eurocurrency liabilities. Without limiting the effect of the foregoing, the
LIBOR Reserve Percentage shall reflect any other reserves required to be
maintained by the Liquidity Bank by reason of any Regulatory Change against (a)
any category of liabilities which includes deposits by reference to which LIBOR
is to be determined or (b) any category of extensions of credit or other assets
which include LIBOR-based credits or assets.
"Liquidity Bank" shall mean Wachovia Bank, N.A., and such other
liquidity banks as may be designated by the Administrative Agent.
"Liquidity Facility" shall mean any revolving liquidity facility
entered into between the Company and the Liquidity Bank pursuant to which the
Liquidity Bank has agreed to make certain liquidity loans from time to time to
the Company.
"Lock-Box Account" shall mean an account maintained by the Collection
Agent at a Lock-Box Bank for the purpose of receiving Collections from
Receivables.
"Lock-Box Bank" shall mean each of the banks set forth in Exhibit C and
such banks as may be added thereto or deleted therefrom pursuant to Section 2.8.
"Lock-Box Notice" shall mean a notice in substantially the form of
Exhibit D from the Transferor to any Lock-Box Bank.
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"Loss Reserve" shall mean, on any date of determination, an amount,
expressed as a percentage equal to the product of (i) 2.0 times the highest
Default Ratio for any three consecutive monthly Reporting Periods calculated in
the Monthly Report for each of the 12 monthly Reporting Periods preceding the
date of determination, and (ii) the Default Horizon Ratio.
"Material Adverse Effect" shall mean a material adverse effect on (i)
the condition (financial or otherwise) or operations of (x) Georgia Gulf and its
Subsidiaries (except the Transferor) taken as one enterprise, or (y) the
Transferor, (ii) the ability of Georgia Gulf or the Transferor to perform their
respective obligations under this Agreement or the Receivables Purchase
Agreement, (iii) the legality, validity or enforceability of this Agreement or
the Receivables Purchase Agreement, (iv) the Company's interest in the aggregate
amount of Receivables or in any significant portion of the Receivables, the
Residual Receivable Interest or the Collections with respect thereto, or (v) the
collectibility of the aggregate amount of Receivables or of any significant
portion of the Receivables.
"Minimum Credit Standard" shall mean that (i) Georgia Gulf's Leverage
Ratio (as defined in the Credit Agreement on and as of the Closing Date) is
3.25x or less, (ii) Georgia Gulf's Interest Coverage Ratio (as defined in the
Credit Agreement on and as of the Closing Date) is 2.75x or higher, or (iii)
Georgia Gulf's Restricted Payments (as defined in the Credit Agreement) are less
than or equal to the sum of (x) $200,000,000 and (y) 50.0% of Cumulative Net
Income (as defined in the Credit Agreement on and as of the Closing Date).
"Monthly Report" shall mean a report, in substantially the form of
Exhibit E or in such other form as is mutually agreed to by the Transferor and
the Company, furnished by the Collection Agent to the Company pursuant to
Section 2.11.
"Net Pool Balance" or "Net Receivables Balance" shall mean, at any
time, the aggregate Outstanding Balance of all Eligible Receivables at such time
reduced by (i) the Excess Concentration Amount and (ii) the Outstanding Balance
of all Defaulted Receivables and Delinquent Receivables at such time.
"1933 Act" shall have the meaning specified in Sub-section (vi) of the
definition of Eligible Receivable.
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended.
"1940 Act" shall have the meaning specified in Sub-section (vii) of the
definition of Eligible Receivable.
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"Obligor" shall mean any Person obligated to make payments to the
Transferor pursuant to or with respect to a Contract, whether such obligation is
direct or indirect, contingent or non-contingent, absolute or conditional, or
matured or unmatured.
"Other Costs" shall have the meaning specified in Section 8.4.
"Other Transferors" shall have the meaning specified in Section 8.1.
"Outstanding Balance" of any Receivable at any time shall mean the then
outstanding principal amount thereof, plus any accrued and outstanding Finance
Charges related thereto.
"Percentage Factor" shall mean the percentage computed at any time of
determination as follows:
ANI + RR
--------
NPB
Where:
ANI= the Aggregate Net Investment at the time of such computation.
RR= the Required Reserve at the time of such computation.
NPB= the Net Pool Balance.
Notwithstanding the foregoing computation, the Percentage Factor shall
not exceed 100%. The Percentage Factor shall be calculated by the Collection
Agent on the day of the Initial Settlement Date. Thereafter, until the
Termination Date, the Collection Agent shall daily recompute the Percentage
Factor and report such recomputations to the Company monthly in the Monthly
Report or as requested by the Company. The Percentage Factor shall remain
constant from the time as of which any such computation or recomputation is made
until the time as of which the next such recomputation shall be made,
notwithstanding any additional Receivables arising, any incremental Transfer
made pursuant to Section 2.2(a) or any reinvestment Transfer made pursuant to
Sections 2.2(b) and 2.5 during any period between computations of the Percentage
Factor. On and after the Termination Date, the Percentage Factor shall be
calculated as of the close of business on the Business Day immediately preceding
the Termination Date, and shall remain constant at all times thereafter until
such time as the Company shall have received the Aggregate Unpaids, at which
time the Percentage Factor shall be recomputed in accordance with Section 2.6.
"Person" shall mean any corporation, natural person, firm, joint
venture, partnership, trust, joint stock company, limited liability company,
unincorporated
13
organization, enterprise, or any government, any department or
agency of any government or any governmental authority.
"Potential Termination Event" shall mean an event which, but for the
lapse of time or the giving of notice or both, would constitute a Termination
Event.
"Prime Rate" refers to that interest rate so denominated and set by
Wachovia from time to time as an interest rate basis for borrowings. The
Prime Rate is but one of several interest rate bases used by Wachovia.
Wachovia lends at interest rates above and below the Prime Rate.
"Proceeds" shall mean "proceeds" as defined in Section 9-306(l) of the
Relevant UCC.
"Rating Agency" shall mean any nationally recognized statistical rating
organization, which as of the date hereof, shall be Xxxxx'x Investor Services,
Standard & Poor's Rating Service, a Division of McGraw Hill, Inc., Duff & Xxxxxx
Credit Rating Co. and Fitch IBCA.
"Receivable" shall mean indebtedness that is (i) owed to Georgia Gulf
by an Obligor that is a resident of the United States of America or organized
and existing under the laws of the United States of America or any state
thereof, and that has a mailing address in the United States under a Contract,
and (ii) sold by Georgia Gulf to the Transferor pursuant to the Receivables
Purchase Agreement, whether constituting an account, chattel paper, instrument
or general intangible, arising in connection with the sale of products or
services by Georgia Gulf, and includes the right to payment of any Finance
Charges and other obligations of all Obligors with respect thereto.
Notwithstanding the foregoing, once a Receivable has been deemed collected
pursuant to Section 2.9 hereof, it shall no longer constitute a Receivable
hereunder.
"Receivables Purchase Agreement" shall mean that certain Receivables
Purchase Agreement, dated as of March 10, 1998, between Georgia Gulf, as seller,
and the Transferor, as purchaser, as the same may from time to time be amended,
supplemented or otherwise modified and in effect.
"Records" shall mean all Contracts and other documents, books, records
and other information (including without limitation computer programs, tapes,
discs, punch cards, data processing software and related property and rights)
maintained by the Transferor and Georgia Gulf with respect to the Receivables
and the Obligors.
"Recoveries" shall mean all amounts (including insurance proceeds, if
any) received by the Collection Agent or the Seller with respect to Defaulted
Receivables.
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"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System, as the same may be amended or supplemented from time to
time.
"Regulatory Change" shall mean any change after the date of this
Agreement in United States (federal, state or municipal) or foreign laws or
regulations (including Regulation D) or the adoption or making after such date
of any interpretations, directives or requests applying to a class of banks
(including the Liquidity Bank) of or under any United States (federal, state or
municipal) or foreign, laws or regulations (whether or not having the force of
law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"Relevant UCC" shall mean, with respect to any state, the Uniform
Commercial Code as from time to time in effect in such state.
"Reporting Date" shall mean the 20th day following the end of each
monthly Reporting Period.
"Reporting Period" shall mean each monthly fiscal period for which the
Collection Agent is required to deliver a report hereunder.
"Required Reserve" shall mean an amount equal to the product of (i) the
Required Reserve Factor and (ii) the aggregate outstanding balances of the Net
Pool Balance.
"Required Reserve Factor" shall mean an amount equal to the greater of
(x) 8.0% (the "Required Reserve Factor Floor") or (y) the sum of (i) the Loss
Reserve, (ii) the Dilution Reserve, (iii) the Yield Reserve and (iv) the
Servicing Reserve; provided, however, in the event Georgia Gulf at any time
fails to meet the Minimum Credit Standard, the Required Reserve Factor Floor
shall be 8.0% plus the product of (x) the Adjusted Dilution Ratio and (y) the
Dilution Horizon Ratio.
"Requirements of Law" shall mean with respect to any Person, the
certificate or articles of incorporation and the by-laws or other organizational
governing documents of such Person, and any law, treaty or rule or regulation,
or determination of an arbitrator or governmental authority, in each case
applicable to or binding upon such Person or to which such Person is subject,
whether federal, state or local (including, but not limited to, usury laws, the
Federal Truth-in-Lending Act, and the Fair Debt Collection Practices Act).
"Residual Receivable Interest" shall mean with respect to any
Receivable:
(i) all of the Transferor's interest, if any, in the product
(including returned product), the sale of which by the Transferor gave
rise to such Receivable;
15
(ii) all other security interests or liens and property
subject thereto from time to time, if any, purporting to secure or
guarantee payment of such Receivable, whether pursuant to the Contract
related to such Receivable or otherwise, together with all financing
statements signed by the Obligor describing any collateral securing
such Receivable;
(iii) all guarantees, letters of credit, acceptances,
insurance and other agreements, instruments or arrangements of whatever
character (including the beneficial interest in any insurance policy or
xxxx of lading) from time to time supporting or securing payment of
such Receivable, whether pursuant to the Contract related to such
Receivable or otherwise;
(iv) all Records; and
(v) all Proceeds of the foregoing.
"Sales" shall mean the gross sales (excluding intercompany sales)
recorded by Georgia Gulf in accordance with GAAP, on its books and records for
the period referenced.
"Section 8.2 Costs" shall have the meaning specified in Section 8.2.
"Section 8.3 Costs" shall have the meaning specified in Section 8.3.
"Servicing Reserve" shall mean the product of the Servicing Fee
applicable to a replacement Servicer and a fraction, the numerator of which is
the highest Days Sales Outstanding of Total Receivables and the denominator of
which is 360.
"Settlement Date" shall mean the first Business Day of each monthly
Reporting Period.
"Settlement Period" shall mean the period beginning on the calendar day
immediately following the Settlement Date for the immediately preceding
Settlement Period and ending on the immediately succeeding Settlement Date;
provided, however, the initial Settlement Period shall begin on the Closing Date
and shall end on the first Settlement Date.
"Subsidiary" shall mean, for any Person, any corporation or other
business organization 50% or more of the outstanding voting securities of which
shall at the time be owned or controlled, directly or indirectly, by such Person
or by one or more such corporations or organizations or by such Person and one
or more such corporations or organizations, and any partnership of which such
Person or any such corporation or organization is a general partner.
16
"Termination Date" shall mean the earliest to occur of (i) the date
that the Company terminates outstanding Tranche Periods pursuant to Section 7.2
hereof, (ii) that Business Day designated by the Transferor as the Termination
Date at any time following 90 days' written notice to the Company, and (iii)
March 9, 1999 , unless extended from time to time upon written agreement between
the Company and the Transferor.
"Termination Event" shall mean an event described in Section 7.1.
"Total Receivable" shall have the meaning set forth herein in the
definition of "Receivable", except that a Total Receivable shall include
indebtedness owed to Georgia Gulf by Obligors with mailing addresses outside the
United States.
"Tranche" shall mean a portion of the Aggregate Net Investment
allocated to a Tranche Period pursuant to Section 2.3.
"Tranche Period" shall mean a CP Tranche Period, Eurodollar Tranche
Period or a BR Tranche Period, as the case may be.
"Tranche Rate" shall mean the CP Rate, the Eurodollar Rate or the Base
Rate, as the case may be.
"Tranche Selection Notice" shall have the meaning set forth in
Section 2.2(a).
"Transfer" shall mean a transfer, sale and conveyance by the Transferor
on each Transfer Date of an undivided percentage ownership interest in each and
every Receivable, together with all Residual Receivable Interest, Collections
and Proceeds with respect thereto and any security or collateral therefor.
"Transfer Date" shall mean, with respect to each Transfer, either (i)
one, two or three Business Days from the Transfer Notice Date, as specified in
Sections 2.2(a) and 2.3(a) relating to such Transfer hereof or (ii) each day on
which Collections are received by the Collection Agent and reinvested in
accordance with Section 2.2(a) and Section 2.2(b) hereof.
"Transfer Notice Date" shall mean, with respect to each Transfer
pursuant to Section 2.2(a) hereof, the Business Day indicated in a written
notice provided by the Transferor to the Company, which date is agreed to by the
Company.
"Transfer Price" shall mean, with respect to any Transfer, an amount
equal to the product of the Advance Rate and the Eligible Receivables to be
transferred.
"Transferred Interest" shall mean, at any time of determination, an
undivided percentage ownership interest in (i) each and every then outstanding
Receivable, (ii) all Residual Receivable Interest with respect to each such
Receivable, (iii) all Collections
17
with respect thereto, and (iv) other Proceeds
of the foregoing, equal to the Percentage Factor at such time, and only at such
time (without regard to prior calculations).
"Yield Reserve" shall mean, on any date of determination, 1.5 times the
Base Rate multiplied by a fraction, the numerator of which is the 12-month high
Days Sales Outstanding and the denominator of which is 360.
SECTION 1.2. Other Terms. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP. To the extent the definitions
of accounting terms used herein are inconsistent with the meanings of such terms
under GAAP, the definitions contained herein shall control. All terms used in
Article 9 of the Relevant UCC, and not specifically defined herein, are used
herein as defined in such Article 9. The definitions of all terms used herein
shall include the singular as well as the plural forms of such terms and the
masculine as well as the feminine and neuter genders of such terms. The terms
"include", "including" and "includes" shall mean including without limitation by
way of enumeration or otherwise. References herein to Articles, Sections,
Exhibits and Schedules shall, unless otherwise specified, refer respectively to
Articles and Sections hereof and Exhibits and Schedules hereto.
SECTION 1.3. Computation of Time Periods. Unless otherwise stated in
this Agreement, in the computation of a period of time from a specified date to
a later specified date, the word "from" means "from and including" and the words
"to" and "until" each means "to but excluding".
ARTICLE II
TRANSFERS AND SETTLEMENTS
SECTION 2.1. Assignment and Conveyance; Facility. Upon the terms and
subject to the conditions herein set forth, the Transferor may sell, transfer,
assign, deliver, convey and set over to the Company, and the Company shall,
subject to its ability to obtain financing therefor through the issuance of
Commercial Paper or the obtaining of liquidity loans pursuant to the Liquidity
Facility (it being understood that the Company shall have no obligation to
obtain such financing through the obtaining of a Eurodollar Tranche or BR
Tranche unless financing is not available through a CP Tranche on such day),
acquire from the Transferor undivided percentage ownership interests in
Receivables, together with the Residual Receivable Interest and Collections with
respect thereto and all proceeds of the foregoing (collectively, the "Assets");
provided, however, that no such acquisition shall be made in excess of the
Transfer Price if, after giving effect to such acquisition, the sum of the
Aggregate Net Investment and the aggregate amount of Discount applicable to all
existing Tranches would exceed the Facility Limit; provided further, however,
that no such acquisition shall be made unless such Transfer Price, together with
any Discount is equal to at least $1,000,000, and no such acquisition
18
shall be made on or after (i) the occurrence of a Termination Event or (ii) the
Termination Date. The Company will pay the Transfer Price of any Transfer made
pursuant to Section 2.2(a) with the proceeds of (a) a CP Tranche or (b) the
obtaining of liquidity loans pursuant to the Liquidity Facility.
SECTION 2.2. Transfers. (a) On each Transfer Notice Date, the
Transferor shall provide the Company with notice in substantially the form of
Exhibit F hereto (each, a "Tranche Selection Notice") which shall specify, among
other things, the face amount of the Commercial Paper proposed to be issued by
or on behalf of the Company; provided that all Commercial Paper issued to fund
Receivables purchased hereunder shall have maturities no later than fifteen (15)
days prior to the scheduled Termination Date hereunder. Such Tranche Selection
Notice shall also contain the Tranche Period(s) and Tranche Rate(s) requested by
the Transferor as required by, and subject to, the limitations of Sections 2.1
and 2.3. The Company shall inquire as to the availability of such Tranche Period
and Tranche Rate and shall, if available and if the terms of the transfer of
such Receivables is otherwise satisfactory, transfer such Receivables on the
following Transfer Date. Following each Transfer on a Transfer Date pursuant to
this Section 2.2(a), the Company shall deposit to the Transferor's account (No.
910-2-624310), account name "GGRC Corp." maintained at the office of The Chase
Manhattan Bank, N.A. in New York, New York, in immediately available funds, an
amount equal to the Transfer Price for such Transfer. Each Tranche Selection
Notice shall be irrevocable and binding on the Transferor, and the Transferor
shall indemnify the Company against any loss or expense incurred by the Company
as a result of any failure by the Transferor to complete such Transfer
including, without limitation, any loss or expense incurred by the Company by
reason of the liquidation or reemployment of funds acquired or requested by the
Company to fund such Transfer.
(b) Reinvestment Transfers. On each Business Day
occurring after the initial Transfer hereunder and prior to the Termination
Date, the Transferor hereby sells, transfers, assigns, delivers, conveys and
sets over to the Company, and the Company hereby acquires from the Transferor,
undivided percentage ownership interests in each and every Receivable, together
with the Residual Receivable Interest and Collections with respect thereto, to
the extent the Collections are available for such Transfer in accordance with
Section 2.5, such that, after giving effect to such Transfer, (i) the amount of
the Company's Aggregate Net Investment at the close of the Company's business on
such Business Day, shall be equal to the amount of the Company's Aggregate Net
Investment at the close of the Company's business on the Business Day
immediately preceding such Business Day, plus the Transfer Price of any Transfer
made on such day, if any, but in no event shall the Aggregate Net Investment
plus Discount be greater than the then Facility Limit, nor shall the Coverage
Amount exceed the Net Pool Balance, and (ii) the Company's Transferred Interest
in each Receivable, together with the Residual Receivable Interest and
Collections with respect thereto, shall be equal to its Transferred Interest in
each other Receivable, together with the Residual Receivable Interest and
Collections with respect thereto.
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(c) All Transfers. Each Transfer shall constitute an
absolute sale, transfer and assignment of undivided percentage ownership
interests in each and every Receivable, together with the Residual Receivable
Interest and Collections with respect thereto then existing, as well as each and
every Receivable, together with the Residual Receivable Interest and Collections
with respect thereto which arises at any time after the date of such Transfer
until the Termination Date. The Company's aggregate undivided percentage
ownership interest in the Receivables, together with the Residual Receivable
Interest and Collections with respect thereto, shall equal the Percentage Factor
in effect from time to time. The Transferred Interest in each Receivable,
together with the Residual Receivable Interest and Collections with respect
thereto, shall at all times be equal to the Transferred Interest in each other
Receivable, together with the Residual Receivable Interest and Collections. To
the extent that the Transferred Interest shall decrease as a result of a
recalculation of the Percentage Factor, the Company shall be considered to have
reconveyed to the Transferor an undivided percentage ownership interest in such
Receivable, together with the Residual Receivable Interest and Collections with
respect thereto, in an amount equal to such decrease such that, in each case,
the Transferred Interest in Receivable shall be equal to the Transferred
Interest in each other Receivable.
It is the express intent of the Transferor and the Company
that the conveyance of the Receivables by the Transferor to the Company pursuant
to this Agreement be construed as a sale of such Receivables by the Transferor
to the Company. Further, it is not the intention of the Transferor and the
Company that such conveyance be deemed a grant of a security interest in the
Receivables by the Transferor to the Company to secure a debt or other
obligation of the Transferor. However, in the event that, notwithstanding the
intent of the parties, the Receivables are construed to constitute property of
the Transferor, then (i) this Agreement also shall be deemed to be, and hereby
is, a security agreement within the meaning of the Relevant UCC; and (ii) the
conveyance by the Transferor provided for in this Agreement shall be deemed to
be, and the Transferor hereby grants to the Company, a security interest in, to
and under all of the Transferor's right, title and interest in, to and under the
Receivables outstanding on the Closing Date and thereafter purchased by the
Transferor pursuant to the Receivables Purchase Agreement, together with all
Residual Receivable Interest and Collections with respect thereto and all
proceeds of the foregoing, to secure the rights of the Company set forth in this
Agreement or as may be determined in connection therewith by applicable law. The
Transferor and the Company shall, to the extent consistent with this Agreement,
take such actions as may be necessary to ensure that, if this Agreement were
deemed to create a security interest in the Receivables, such security interest
would be deemed to be a perfected security interest in favor of the Company
under applicable law and will be maintained as such throughout the term of this
Agreement.
(d) Percentage Factor. The Percentage Factor shall be
initially computed on the Initial Settlement Date. Thereafter, until the
Termination Date, the
20
Percentage Factor shall be automatically recomputed as of
the close of business of the Collection Agent on each day (other than a day
after the Termination Date). The Percentage Factor shall remain constant from
the time as of which any such computation or recomputation is made until the
time as of which the next such recomputation, if any, shall be made. The
Percentage Factor, as computed as of the day immediately preceding the
Termination Date, shall remain constant at all times on and after such
Termination Date until the date on which the Aggregate Net Investment shall
become zero.
SECTION 2.3. Selection of Tranche Periods and Tranche Rates.
(a) At all times hereafter, but prior to the occurrence
of a Termination Event, the Transferor shall, subject to availability and the
Company's approval as provided in Sections 2.1 and 2.2 and the limitations
described below, request Tranche Periods and Tranche Rates applicable thereto
and allocate each Transfer to each selected Tranche Period, so that the
aggregate amounts allocated to outstanding Tranche Periods at all times shall
equal the Aggregate Net Investment. In the Tranche Selection Notice, the
Transferor shall give the Company irrevocable notice of each new Tranche Period
(i) with respect to a BR Tranche, by 12:00 P.M. (Eastern Time) on the day of
expiration of any then existing Tranche Period, (ii) with respect to a
Eurodollar Tranche, by 12:00 P.M. Eastern Time) on a Business Day not less than
three Business Days prior to the expiration of any then existing Tranche Period,
and (iii) with respect to a CP Tranche, by the close of business in Atlanta,
Georgia not less than three Business Days prior to the expiration of any then
existing Tranche Period; provided, however, that the Company may select, in its
sole discretion, any such new Tranche Period and Tranche Rate if (i) the
Transferor fails to provide such notice on a timely basis or (ii) the Company
determines, in its sole discretion, that the Tranche Rate or Tranche Period
selected by the Transferor is unavailable; and provided further, however, that
any such Tranche Period chosen by the Company, in its sole discretion, shall be
for a term of one day. Subject to the provisions of this Agreement, including
Section 2.1, and without changing the limitations on the Company's obligations
hereunder, in the event the Transferor does not specify a Tranche Rate or
Tranche Period, the Tranche Period and Tranche Rate shall be the CP Rate for a
CP Tranche Period of 30 days or the actual number of days until the next
Settlement Date. In the event that the Company after exercising all reasonable
efforts, cannot sell or cause to be sold the Commercial Paper pursuant to the
preceding sentence, then for the next two Business Days the tranche shall be a
BR Tranche, and thereafter the tranche shall be a Eurodollar Tranche for a
Eurodollar Tranche Period and the Tranche Rate shall be the corresponding
Eurodollar Rate. The Company shall promptly confirm to the Transferor each
Tranche Rate and each Tranche Period. In the case of any Tranche Period
outstanding at the time of the Company's notice of termination of all
outstanding Tranche Periods given pursuant to Section 7.2, such Tranche Period
shall end on the date of such notice.
(b) Notwithstanding anything to the contrary contained
herein, at all times on and after the occurrence of a Termination Event, (i) the
Company shall select all
21
Tranche Periods and Tranche Rates (which shall be the Base Rate) applicable
thereto and (ii) the Facility Limit will be reduced on each day thereafter to
the Aggregate Unpaids as of such day.
SECTION 2.4. Discount, Fees and Other Costs and Expenses. The
Transferor shall pay or cause to be paid, as and when due in accordance with
this Agreement (to the extent unpaid after giving effect to any payments made
pursuant to Section 2.5 or Section 2.6), all amounts payable as Discount, all
fees hereunder, all dealer commissions (if applicable), all amounts payable
pursuant to Article VIII, if any, and all Collection Agent costs, if any,
payable pursuant to Section 6.2. Discount shall accrue with respect to each
Tranche on each day occurring during the Tranche Period related thereto, and
shall be paid on each Settlement Date. The Transferor may, at its option and
prior to the occurrence of a Termination Event or 15 days prior to any scheduled
Termination Date hereunder, satisfy its obligation to pay Discount accrued on a
Tranche by requesting a new CP Tranche Period in accordance with Section 2.3(a).
Such new CP Tranche will increase the Aggregate Net Investment by the amount of
such accrued Discount which is allocated to such new CP Tranche Period and will
constitute a Transfer pursuant to Section 2.2(a). In the event that the proceeds
from such new CP Tranche exceed the sum of such Discount and tranche amounts
that are refinanced pursuant to the second preceding sentence, the excess amount
shall be treated in a manner consistent with the treatment of the Percentage
Factor of Collections under Section 2.5 and the Aggregate Net Investment shall
be increased accordingly All per annum fees shall be paid monthly on the
Settlement Date. If any amount hereunder shall be paid on a day which is not a
Business Day, such amount shall be payable on the next succeeding Business Day.
Discount and all per annum fees payable hereunder shall be calculated for the
actual days elapsed and on a year consisting of 360 days. Nothing in this
Agreement shall limit in any way the obligations of Transferor to pay the
amounts set forth in this Section 2.4.
SECTION 2.5. Non-Liquidation Settlement and Reinvestment Procedures. On
each day after the date of the initial Transfer, but prior to the Termination
Date, the Collection Agent shall, out of the Percentage Factor of Collections
received on such day or prior to such day and not previously applied or
accounted for, allocate funds in the following order: (i) from and after the
request of the Company, set aside and hold in trust for the Company, an amount
equal to all Discount and all facility fees and charges accrued through such day
and not previously set aside or paid and (ii) apply the balance of such
Percentage Factor of Collections remaining after application as provided in
clause (i) of this Section 2.5 to (x) the Transfer, for the benefit of the
Company, of additional undivided percentage interests in each Receivable, to the
extent that a transfer under Section 2.5(ii)(x) would cause a Termination Event
as described in Section 7.1(k) or 7.1(l), together with Residual Receivable
Interest and Collections with respect thereto, pursuant to Section 2.2(b) or (y)
as necessary to reduce the sum of the Aggregate Net Investment plus Discount to
not more than the Facility Limit. On the last day of each Tranche Period, from
the amounts set aside as described in clause (i) of the first sentence
22
of this Section 2.5, the Collection Agent shall deposit to the Company's account
an amount equal to the accrued and unpaid Discount for such Tranche Period.
SECTION 2.6. Liquidation Settlement Procedures.
(a) If, on the Termination Date, the Net Receivables
Balance is less than the Coverage Amount, then the Transferor shall
immediately pay to the Company an amount equal to the difference between the
Coverage Amount and the Net Receivables Balance, and such amount shall be
applied to the reduction of the Aggregate Net Investment for Tranche Periods
selected by the Company. On the Termination Date and on each day thereafter,
the Collection Agent shall set aside and hold in trust for the Company, the
Percentage Factor of all Collections received on such day. On the last day of
each Tranche Period to occur on or after the Termination Date, the Collection
Agent shall deposit to the Company's account the amounts set aside pursuant
to the preceding sentence, together with any remaining amounts set aside
pursuant to Section 2.5(i) prior to the Termination Date, but not to exceed
the sum of (i) the Discount for such Tranche Period, (ii) the portion of the
Aggregate Net Investment allocated to such Tranche Period, and (iii) the
aggregate of all other amounts then owed (whether due or accrued) hereunder
by Transferor to the Company. If Georgia Gulf is the Collection Agent, the
Collection Agent shall pay all the amounts described in clauses (i), (ii) and
(iii) of this Section 2.6(a) from any funds available therefor, up to the
amount that would have been set aside by the Collection Agent had the
Collection Agent been required to comply with the second sentence of this
Section 2.6.
(b) If there shall be insufficient funds on deposit for the
Collection Agent to distribute funds in payment in full of the amounts
described in Section 2.6(a), the Collection Agent shall distribute funds
first, to pay the accrued Discount, second, to reduce the Aggregate Net
Investment, third, to pay all fees and expenses payable to the Company, and
fourth, in payment of all other amounts payable to the Company. Following the
date on which the Aggregate Net Investment has been reduced to zero, all
accrued Discount has been paid in full and all other Aggregate Unpaids have
been paid in full, (i) the Collection Agent shall recompute the Percentage
Factor as zero, (ii) the Company shall be deemed to have reconveyed to the
Transferor any interest in the Receivables (including the Transferred
Interest), (iii) the Collection Agent shall pay to the Transferor all amounts
held pursuant to the second sentence of Section 2.6(a) and (iv) the Company
shall promptly at the request of the Transferor execute and deliver to the
Transferor any documents required or advisable to terminate its interest in
the Receivables and the Residual Receivable Interest.
SECTION 2.7. Fees. Notwithstanding any limitation on recourse
contained in this Agreement, the Transferor shall pay the following fees in
the following priority:
(a) to the Company, on the first Business Day of each
month, the Administration Fee for the preceding month,
23
(b) to the Company, on the date of incurrence thereof, any
Early Collection Fee,
(c) to the Collection Agent, on the first Business Day of
each month, the Servicing Fee .
SECTION 2.8. Protection of Company's Ownership Rights.
(a) The Transferor agrees that from time to time, at its
expense, it will promptly execute and deliver all instruments and documents
and take all actions that the Company may reasonably request in order to
perfect or protect the Transferred Interest or to enable the Company to
exercise or enforce any of its rights hereunder. Without limiting the
foregoing, each of the Transferor and Georgia Gulf will, upon the request of
the Company, in order to accurately reflect this transaction, execute and
file such financing and continuation statements, and amendments thereto or
assignments thereof (as permitted pursuant to Section 9.6) as may be
reasonably requested by the Company and xxxx its master data processing
records and other documents with a legend describing the acquisition by the
Company of the Transferred Interest, as the Company may reasonably request.
To the fullest extent permitted by applicable law, the Company shall be
permitted to sign and file continuation statements and amendments thereto and
assignments thereof without the Transferor's signature in such cases where
the Transferor is obligated hereunder to sign such statements, amendments or
assignments. Carbon, photographic or other reproductions of this Agreement or
any financing statement shall be sufficient as a financing statement. Neither
the Transferor nor Georgia Gulf shall change its name, identity or corporate
structure (within the meaning of Section 9-402(7) of the Relevant UCC) nor
relocate its chief executive office or any office where Records are kept
unless it shall have: (i) given the Company at least fifteen (15) days' prior
notice thereof and (ii) delivered to the Company all financing statements,
instruments and other documents reasonably requested by the Company in
connection with such change or relocation and deemed reasonably appropriate
by the Company to preserve its ownership of in the Receivables and the
Residual Receivable Interest.
(b) Each Contract shall instruct the Obligor with respect
thereto to cause all Collections to be deposited directly with a Lock-Box
Bank. Neither the Transferor nor the Collection Agent shall add any bank as a
Lock-Box Bank to those listed on Exhibit C hereto unless the Company shall
have received notice of such addition and undated executed copies of Lock-Box
Notices to each new Lock-Box Bank. Neither the Transferor nor the Collection
Agent shall terminate any bank as a Lock-Box Bank or terminate any account as
a Lock-Box Account unless the Company shall have received thirty (30) days'
prior notice of such termination. If the Transferor or the Collection Agent
receives any Collections or is deemed to receive any Collections pursuant to
Section 2.9, the Transferor or the Collection Agent shall immediately, and
not later than the next business day, remit such Collections to the Company.
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SECTION 2.9. General Settlement Procedures. If on any day the
Outstanding Balance of a Receivable is either (x) reduced as a result of any
defective or rejected goods or services, any cash discount or any adjustment by
the Transferor or the Collection Agent or (y) reduced or canceled as a result of
a setoff in respect of any claim by any Person (whether such claim arises out of
the same or a related transaction or an unrelated transaction) or (z) canceled
as a result of the Transferor or the Collection Agent exercising its right to
assign a Receivable back to the Obligor thereof, the Transferor shall be deemed
to have received on such day a Collection of such Receivable in the full amount
of such reduction or cancellation, and the Aggregate Net Investment shall not be
deemed to be reduced hereunder until such time as such amount is remitted to,
and received by, the Company. If on any day any of the representations or
warranties with respect to the Receivables in Section 3.1(d), (e), (f), (i),
(j), (k), (n), (o), (p) or (r) is no longer true with respect to a Receivable,
as the Transferor or the Company shall notify the other, the Transferor shall be
deemed to have received on such day a Collection of such Receivable in full, and
the Aggregate Net Investment shall not be deemed to be reduced hereunder until
such time as such amount is remitted to, and received by, the Company. Any
payment by an Obligor in respect of any Receivable shall, except as otherwise
specified by such Obligor or otherwise required by contract or law, be applied
as a Collection of the Receivable of such Obligor (starting with the oldest such
Receivable) to the extent of any amounts then due and payable thereunder before
being applied to any other Receivable of such Obligor.
SECTION 2.10. Payments and Computations, Etc. All amounts to be paid or
deposited by the Transferor or the Collection Agent hereunder shall be paid or
deposited in accordance with the terms hereof no later than 11:00 A.M. (Eastern
Time) on the day when due in funds immediately available to the Company in
Atlanta, Georgia; if such amounts are payable to the Company they shall be paid
or deposited to Account Number 8735-098787, titled "Blue Ridge Asset Funding
Corporation, "CP"," and maintained at the offices of Wachovia Bank N.A., until
otherwise notified by the Company. The Transferor shall pay to the Company upon
demand, interest on all amounts not paid or deposited when due to the Company
hereunder at a rate equal to 2% per annum plus the Base Rate, provided such
interest shall in no event exceed the maximum permitted by law. All computations
of interest hereunder shall be made on the basis of a year of 360 days for the
actual number of days (including the first but excluding the last day) elapsed.
SECTION 2.11. Reports. Prior to the 20th day of each month, the
Collection Agent shall prepare and forward to the Company (i) a Monthly
Report, as of the close of business of the Collection Agent on the last day
of the immediately preceding Reporting Period, in the form attached hereto as
Exhibit E, (ii) a listing of the ten (10) largest Obligors by Receivables
balance, together with an aging of such Receivables, in substantially the
form of Exhibit G hereto and (iii) such other information as the Company may
reasonably request. The Transferor shall, by not later than May 10, 1998,
change the Monthly Report to show categories of aged Receivables based on
Sales and
25
the Sales for each month related to such Monthly Report and the related dollar
amounts of customer credits in a manner reasonably acceptable to the Company.
SECTION 2.12. Increase in and Reduction of Facility Limit. The
Transferor may, upon at least 30 days' prior written notice to the Company, and
with the consent of the Company, either (i) increase in part the Facility Limit
or (ii) terminate in whole or reduce in part the unused portion of the Facility
Limit; provided that each partial increase or reduction of the Facility Limit
shall be in an amount equal to $5,000,000 or an integral multiple thereof.
SECTION 2.13. Optional Retransfer. On any day on which the Aggregate
Unpaids falls below 10% of the Facility Limit, then, in such event, the
Transferor may, in its sole discretion, direct the Company to retransfer the
Transferred Interest to the Transferor at a price equal to the Aggregate Unpaids
calculated as of the proposed date of such retransfer. The Company further
agrees to take, on or prior to such transfer, at the sole expense of the
Transferor, any action reasonably necessary to effectuate the transfer to the
Transferor of all of the Company's interest in, to and under the Receivables and
the Residual Receivable Interest and Collections with respect thereto.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties. Each of the Transferor
and Georgia Gulf, as applicable to itself and not as to the other, hereby
represents and warrants to the Company that:
(a) Corporate Existence and Power. Each of the Transferor
and Georgia Gulf is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and has all corporate
power, authority and legal right to own its properties and conduct its
businesses as presently conducted and to execute, deliver and perform its
obligations under this Agreement. Each of the Transferor and Georgia Gulf is
duly qualified to do business and is in good standing (or is exempt from such
requirements) and has obtained all necessary licenses and approvals,
authorizations and consents with respect to the Transferor or Georgia Gulf,
as applicable, in each jurisdiction which failure to so qualify or to obtain
such licenses, approvals, consents and authorizations would render any
Receivable or Contract unenforceable by it, the Company or the Company's
assigns, and would have a Material Adverse Effect on the Company's or the
Collection Agent's ability to perform their respective obligations under this
Agreement or the Receivables Purchase Agreement.
(b) Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the Transferor and
Georgia Gulf of this Agreement and each other document and instrument
required to be delivered by the
26
Transferor and Georgia Gulf, respectively, hereunder (collectively, the
"Conveyance Papers") are within their respective corporate powers, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any governmental body, agency or official (except
as contemplated by Section 2.8). The execution and delivery of this Agreement
by the Seller, the performance by the Transferor and Georgia Gulf,
respectively, of the transactions contemplated hereby, and the performance by
the Transferor and Georgia Gulf, respectively, of the terms hereof and of the
Receivables Purchase Agreement will not conflict with, violate or result in
any breach of any of the material terms and provisions of, or constitute
(with or without notice or lapse of time, or both) a default under, any
Requirement of Law applicable to the Transferor or and Georgia Gulf, as
applicable, or any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which the Transferor or Georgia Gulf, as applicable, is a
party or by which it or any of their respective properties are bound and
which conflict, violation, breach or default would have a Material Adverse
Effect on the Company or its successors and assigns or on the Company's or
the Collection Agent's ability to perform their respective obligations under
this Agreement or the Receivables Purchase Agreement.
(c) Binding Effect of Agreement. Each of this Agreement and
the Receivables Purchase Agreement constitutes the legal, valid and binding
obligation of the Transferor and Georgia Gulf, enforceable against each of
them in accordance with the terms hereof, subject to the effect of
bankruptcy, insolvency, reorganization or other similar laws affecting
enforcement of creditors' rights generally.
(d) Perfection. Immediately preceding each Transfer
hereunder, the Transferor shall be the sole owner of all of the Receivables
and all Residual Receivable Interest, free and clear of any Adverse Claim. On
or prior to each Transfer, all financing statements and other documents and
instruments required to be recorded or filed in order to perfect and protect
the Transferred Interest against all creditors of, and purchasers of
Receivables from, the Transferor or Georgia Gulf, as applicable (other than
any financing statements or assignments of financing statements required to
perfect the Transferred Interest), will have been duly filed in each filing
office necessary for such purpose and all filing fees and taxes, if any,
payable in connection with such filings shall have been paid in full.
(e) Accuracy of Information. All information heretofore
furnished by the Transferor and Georgia Gulf to the Company for purposes of
or in connection with this Agreement, the Receivables Purchase Agreement or
any transaction contemplated hereby is, and all such information hereafter
furnished by the Transferor or Georgia Gulf, as applicable, to the Company
and/or any successor and assign will be, true and accurate in every material
respect, on the date such information is stated or certified.
(f) Tax Returns. The Transferor has filed or properly
extended all tax returns (federal, state and local) required to be filed and
has paid or made adequate
27
provision for the payment of all taxes, assessments and other government
charges except where the failure by the Transferor to perform such
obligations would not have a Material Adverse Effect.
(g) Actions, Suits. Except as set forth in Exhibit H, there
are no actions, suits or proceedings pending, or to the knowledge of the
Transferor and/or Georgia Gulf threatened, against or affecting the
Transferor, Georgia Gulf or any Affiliate of either of them or their
respective properties or with respect to the Receivables, in or before any
court, arbitrator, governmental authority or other body, (i) asserting the
invalidity of this Agreement or the Receivables Purchase Agreement, (ii)
seeking to prevent the consummation of any of the transactions contemplated
by this Agreement or the Receivables Purchase Agreement, (iii) seeking any
determination or ruling that, in the reasonable judgment of the Transferor
and/or Georgia Gulf, would materially and adversely affect the performance by
the Transferor or Georgia Gulf of their respective obligations hereunder,
(iv) seeking any determination or ruling that would materially and adversely
affect the validity or enforceability of this Agreement or the Receivables
Purchase Agreement, or (v) which may have a Material Adverse Effect.
(h) Place of Business. The principal place of business and
chief executive office of Georgia Gulf and the Transferor are located at 000
Xxxxxxxxx Xxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000, and the offices
where each of Georgia Gulf and the Transferor keeps all its Records are
located at the address(es) described on Exhibit I or such other locations
notified to the Company in accordance with Section 2.8 in jurisdictions where
all action required by Section 2.8 has been taken and completed.
(i) Good Title. This Agreement constitutes a valid sale,
transfer and assignment to the Company of all right, title and interest of
the Transferor in and to the Receivables, whether existing on the date
hereof, or hereafter created and all proceeds thereof, which are effective as
to each Receivable upon the creation thereof. Upon each Transfer, the Company
shall acquire a valid and perfected first priority undivided percentage
ownership interest in each Receivable and Related Security that exists on the
date of such Transfer and in the Residual Receivable Interest and Collections
with respect thereto, free and clear of any Adverse Claim.
(j) Nature of Receivables; Use of Proceeds. Each Receivable
is (A) an account receivable representing all or part of the sales price of
merchandise, insurance or services (or an "eligible asset" within the meaning
of Rule 3a-7 under the 0000 Xxx) and the proceeds of the Commercial Paper
with which the Company will acquire the Receivables are to be used by the
Transferor for current transactions within the meaning of Section 3(a)(3) of
the 1933 Act, and (B) an Eligible Receivable. No proceeds of any Transfer
will be used by the Transferor to acquire any security in any transaction
which is subject to Section 13 or 14 of the 1934 Act, or for the purpose of
acquiring or holding any margin securities.
28
(k) Lock-Box Accounts. The names and addresses of all the
Lock-Box Banks, together with the account numbers of the Transferor at such
Lock-Box Banks are described on Exhibit C or described in a notice provided
by the Transferor and Georgia Gulf to the Company pursuant to Section 2.8.
All Obligors have been instructed to make payment directly to a Lock-Box
Account, and all Collections are deposited into the Lock-Box Accounts.
(l) No Material Adverse Change. Since September 30, 1997,
there has been no change in the condition (financial or otherwise), business,
operations or prospects of the Transferor or Georgia Gulf, or in the ability
of either of them to perform their respective obligations hereunder or in the
collectibility of the Receivables, which change might have a Material Adverse
Effect.
(m) Trade Names. Except as described in Exhibit J, neither
the Transferor nor Georgia Gulf has used any corporate names, trade names or
assumed names other than its name set forth on the signature pages of this
Agreement and, within the last five years, has not changed its name, merged
with or into or consolidated with any other corporation or been the subject
of any proceeding under Xxxxx 00, Xxxxxx Xxxxxx Code (the "Bankruptcy Code").
(n) Binding Effect of Receivables and Contract. Each
Receivable and the related Contract and any Residual Receivable Interest
constitutes a legal, valid and binding obligation of the Obligor enforceable
against the Obligor, subject to the effect of bankruptcy, insolvency,
reorganization or similar laws affecting the enforcement of creditors' rights
generally.
(o) No Restriction on Transfer. No Contract requires the
prior consent of an Obligor or contains any other restriction relating to the
transfer or assignment of rights of payment under such Contract which are
legally enforceable (other than a consent or waiver of such restriction that
has been obtained prior to the Closing Date).
(p) Restrictions on Chattel Paper. The Transferor and
Georgia Gulf shall not permit any portion of the Transferred Interest that
constitutes chattel paper within the meaning of Section 9-105 of the Relevant
UCC to be transferred to or possessed by any other party other than the
Company or the Transferor, as appropriate.
(q) Coverage Requirement. The Net Receivables Balance
equals or exceeds the Coverage Amount.
(r) Credit Policy. Since February 2, 1998, there have been
no material changes in the Credit Policy, and since such date, no material
adverse change has occurred in the overall rate of collection of Receivables.
29
(s) No Termination Event. No event has occurred and is
continuing and no condition exists which constitutes a Termination Event or
a Potential Termination Event.
(t) Not an Investment Company. The Transferor and Georgia
Gulf are (i) not, and are not controlled by, an "investment company" within
the meaning of the 1940 Act, or (ii) are exempt from all provisions of the
1940 Act.
(u) ERISA. Each of the Transferor and Georgia Gulf is in
compliance in all material respects with ERISA and no lien in favor of the
Pension Benefit Guaranty Corporation on any of the Receivables exists, or to
the knowledge of the Transferor or Georgia Gulf, is pending or threatened.
(v) Bulk Sales. No transaction contemplated by this
Agreement requires compliance with any bulk sales act or similar law.
(w) No Preference, etc. The conveyance of the Receivables,
the Collections and Related Security to the Company, and each such
conveyance, shall not have been made for or on account of an antecedent debt
owed by the Transferor or Georgia Gulf to the Company.
Any document, instrument, certificate or notice delivered to
the Company hereunder shall be deemed a representation and warranty by the
Transferor and Georgia Gulf.
SECTION 3.2. Reaffirmation of Representations and Warranties On each
day that a Transfer is made hereunder, the Transferor, by accepting the proceeds
of such Transfer or reinvestment pursuant to Section 2.2(b), shall be deemed to
have certified that (i) all representations and warranties described in Section
3.1 are true and correct on and as of such day as though made on and as of such
day and (ii) no event has occurred or is continuing, or would result from any
such Transfer or recomputation, which constitutes a Termination Event or a
Potential Termination Event. The representations and warranties set forth in
Section 3.1 shall survive the conveyance of the Receivables to the Company and
the termination of this Agreement. Upon discovery by the Company, or the
Transferor or Georgia Gulf of a breach of the representations and warranties set
forth in Section 3.1, the party discovering such breach shall give written
notice to the others within three Business Days of such discovery.
ARTICLE IV
CONDITIONS PRECEDENT
30
SECTION 4.1. Conditions to Closing. This Agreement shall become
effective on the first date on which the Transferor and Georgia Gulf shall
deliver to the Company the following documents and instruments, all of which
shall be in form and substance acceptable to the Company:
(a) A Certificate of the Secretary of the Transferor
certifying (i) the names and signatures of the officers and employees
authorized on its behalf to execute this Agreement and any other documents to
be delivered by it hereunder (on which Certificate the Company may
conclusively rely until such time as the Company shall receive from the
Transferor a revised Certificate meeting the requirements of this clause
(a)(i)), (ii) a copy of the Transferor's Certificate of Incorporation,
certified by the Secretary of State of the State of Delaware, (iii) a copy of
the Transferor's By-Laws, (iv) a copy of resolutions of the Board of
Directors of the Transferor approving this Agreement and the transactions
contemplated herein, and (v) certificates of the Secretaries of State of the
States of Delaware and Georgia certifying the Transferor's good standing
under the laws of the States of Delaware and Georgia, respectively.
(b) A Certificate of the Secretary of Georgia Gulf
certifying (i) the names and signatures of the officers and employees
authorized on its behalf to execute this Agreement and any other documents to
be delivered by it hereunder (on which Certificate the Company may
conclusively rely until such time as the Company shall receive from Georgia
Gulf a revised Certificate meeting the requirements of this clause (b)(i)),
(ii) a copy of Georgia Gulf's Certificate of Incorporation, certified by the
Secretary of State of the State of Delaware, (iii) a copy of Georgia Gulf's
By-Laws, (iv) a copy of resolutions of the Board of Directors of Georgia Gulf
approving this transaction and (v) certificates of the Secretaries of State
of the States of Delaware and Georgia certifying the Transferor's good
standing under the laws of the States of Delaware and Georgia, respectively.
(c) Acknowledgment copies of proper financing statements
(Form UCC-1), dated a date reasonably near to the date of the initial
Transfer naming the Transferor as the transferor of Receivables and the
Company as acquiror or other similar instruments or documents as may be
necessary or in the opinion of the Company desirable under the Relevant UCC
of all appropriate jurisdictions or any comparable law to perfect the
Company's ownership interest in all Receivables and the Residual Receivable
Interest with respect thereto hereunder.
(d) Acknowledgment copies of proper financing statements
(Form UCC-1), dated a date reasonably near to the date of the initial
Transfer naming Georgia Gulf as the seller of Receivables and the Transferor
as purchaser or other similar instruments or documents as may be necessary or
in the opinion of the Company desirable under the Relevant UCC of all
appropriate jurisdictions or any comparable law to perfect the Transferor's
ownership interest in all Receivables and the Residual Receivable Interest
with respect thereto under the Receivables Purchase Agreement.
31
(e) Acknowledgment copies of proper financing statements
(Form UCC-3) and lien releases, if any, necessary to release all security
interests and other rights of any person in Receivables previously granted by
Georgia Gulf and/or the Transferor.
(f) Certified copies of request for information or copies
of UCC-1 or similar search reports (certified by parties acceptable to the
Company) dated a date reasonably near the date of the initial Transfer
listing all effective financing statements which name Georgia Gulf (under its
present name and any previous name) as transferor or debtor and which are
filed in appropriate jurisdictions together with copies of such financing
statements.
(g) A favorable opinion of Xxxxx, Day, Xxxxxx and Xxxxx,
special counsel for Georgia Gulf, as to such matters as the Company may
reasonably request.
(h) A favorable opinion of Xxxxx, Day, Xxxxxx and Xxxxx,
special counsel for the Transferor, as to such matters as the Company may
reasonably request.
(i) A favorable opinion of Xxxxx, Day, Xxxxxx and Xxxxx,
special counsel for Georgia Gulf and the Transferor, covering certain
bankruptcy, insolvency and substantive nonconsolidation matters, in form and
substance satisfactory to the Company and the Company's counsel.
(j) A certificate in the form of Exhibit K, executed by
the chief financial officer or corporate controller of the Transferor.
(k) A Monthly Report relating to the Receivables for the
months of January and February 1998.
(l) Undated executed copies of Lock-Box Notices to Lock-Box
Banks.
(m) Executed copies of the Receivables Purchase Agreement
and the Fee Letter.
(n) Draft consolidated financial statements for (i) Georgia
Gulf and its Subsidiaries and (ii) the Transferor, as of and for the year
ended December 31, 1997 (with executed finals to be provided as soon as these
are available to Georgia Gulf and by not later than April 5, 1998), and
agreed upon procedures prepared by Xxxxxx Xxxxxxxx LLP dated March 1998 with
respect to servicing.
(o) Such other documents as the Company shall reasonably
request.
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ARTICLE V
COVENANTS
SECTION 5.1. At all times from the date hereof to the latest to occur
of (i) the Termination Date or (ii) the date on which the Company's Transferred
Interest shall be equal to zero, unless the Company shall otherwise consent in
writing:
(a) Reporting Obligations. The Transferor will, and will
cause Georgia Gulf to, maintain, each for itself and each Subsidiary, a
system of accounting established and administered in accordance with GAAP,
and furnish to the Company:
(i) SEC Filings. Within 5 days of filing thereof, copies of
all registration statements, annual (Form 10-K) report, including
financial statements audited by, with a report thereon prepared by,
nationally recognized independent public accountants, (Form 10-Q),
monthly or other reports, including Form 8-K current reports which the
Transferor, Georgia Gulf or any Subsidiary thereof files with the
Securities and Exchange Commission pursuant to the 1934 Act.
(ii) Compliance Certificate. Together with the reports
required above, a compliance certificate in substantially the form of
Exhibit K hereto signed by its chief financial officer or corporate
controller stating that no Termination Event or Potential Termination
Event exists, or if any Termination Event or Potential Termination
Event exists, stating the nature and status thereof.
(iii) Change in Credit Policy. Within 10 days after the date
any material change in or amendment to the Credit Policy is made
(including changes in payment instructions to Obligors), a copy of the
Credit Policy then in effect indicating such change or amendment.
(iv) Other Information. Such other information (including
non-financial information) as the Company may from time to time
reasonably request.
(b) Certain Notices. Each of the Transferor and Georgia
Gulf will notify the Company in writing of any of the following, immediately
upon learning of the occurrence thereof, describing the same and, if
applicable, the steps being taken by the Person(s) affected with respect
thereto:
(i) Notice of Termination Events or Potential Termination
Events. As soon as possible and in any event within two (2) days after
the occurrence of each Termination Event or each Potential Termination
Event of which the Transferor or Georgia Gulf has knowledge, a
statement of the chief financial officer or corporate controller of the
Transferor or Georgia Gulf, as applicable, setting forth details of
such Termination Event or Potential Termination Event and the action
33
which the Transferor or Georgia Gulf, as applicable, proposes to take
with respect thereto.
(ii) Litigation. The institution of any litigation,
arbitration proceeding or governmental proceeding which may have a
Material Adverse Effect.
(iii) Judgments. The entry of any judgment or decree against
the Transferor, or Georgia Gulf or any of its Subsidiaries (other than
the Transferor) if the aggregate amount of all judgments or decrees
then outstanding against the Transferor or Georgia Gulf and its
Subsidiaries, respectively, exceeds $5,000,000 after deducting (A) the
amount with respect to which the Transferor or Georgia Gulf and its
Subsidiaries is insured and (B) the amount for which the Transferor or
Georgia Gulf and such Subsidiary is otherwise indemnified if the terms
of such indemnification are satisfactory to the Company.
(c) Conduct of Business. Each of the Transferor and Georgia
Gulf will, and Georgia Gulf will cause each of its Subsidiaries to, carry on
and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently conducted and
will do all things necessary to remain duly incorporated, validly existing
and in good standing as a domestic corporation in its jurisdiction of
incorporation and will maintain all requisite authority to conduct its
business in each jurisdiction in which its business is conducted, except
where the failure to obtain any such approval would not have a Material
Adverse Effect.
(d) Compliance with Laws. Each of the Transferor and
Georgia Gulf will, and Georgia Gulf will cause each of its Subsidiaries to,
comply with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject, except where the
failure to comply with such laws and regulations would not have a Material
Adverse Effect.
(e) Furnishing of Information and Inspection of Records.
Each of the Transferor and Georgia Gulf will furnish to the Company from time
to time such information with respect to the Receivables as the Company may
reasonably request, including listings identifying the Outstanding Balance
for each Receivable. Each of the Transferor and Georgia Gulf will, at any
time and from time to time during regular business hours with prior written
notice, permit the Company or its agents or representatives, (i) to examine
and make copies of and abstracts from all Records and (ii) to visit the
offices and properties of the Transferor or Georgia Gulf for the purpose of
examining such Records, and to discuss matters relating to Receivables or the
Transferor's or Georgia Gulf's performance hereunder with any of the
officers, directors, employees or independent public accountants of the
Transferor or Georgia Gulf having knowledge of such matters.
34
(f) Keeping of Records and Books of Account. Each of the
Transferor and Georgia Gulf will maintain and implement administrative and
operating procedures (including an ability to recreate all Records evidencing
Receivables in the event of the destruction of the originals thereof), and
keep and maintain, or obtain, as and when required, all documents, books,
records and other information reasonably necessary or advisable for the
collection of all Receivables (including, without limitation, records
adequate to permit the daily identification of each new Receivable and all
Collections of, and adjustments to, each existing Receivable). Without
limiting the foregoing, the Transferor will, in order to accurately reflect
this purchase and sale transaction, execute and file such financing or
continuation statements or amendments thereto or assignments thereof (as
permitted pursuant hereto) as may be requested by the Company and xxxx its
master data processing records and other documents including the Detailed
Aged Trial Balance and the Summary Aged Trial Balance by the Closing Date or
as soon as practicable thereafter (but in no event to exceed 20 days from the
Closing Date), with a legend describing the purchase by the Company of the
Receivables pursuant to the Transfer Agreement and stating "These accounts
receivable have been purchased from Georgia Gulf Corporation by GGRC Corp.
pursuant to a Receivables Purchase Agreement dated as of March 10, 1998 and
GGRC Corp. has conveyed an interest in these accounts receivable to Blue
Ridge Asset Funding Corporation pursuant to a Receivables Transfer Agreement
dated as of March 10, 1998." Each of the Transferor and Georgia Gulf will
give the Company prompt written notice of any change in the administrative
and operating procedures referred to in this paragraph (f).
(g) Performance and Compliance with Receivables and
Contracts. Each of the Transferor and Georgia Gulf will at its own expense
timely and fully perform and comply with all provisions, covenants and other
promises required to be observed by it under the Contracts related to the
Receivables.
(h) Credit Policy. Each of the Transferor and Georgia
Gulf will comply with the Credit Policy in regard to each Receivable and the
related Contract.
(i) Collections. The Transferor and/or Georgia Gulf
shall instruct all Obligors to cause all Collections to be deposited directly
to a Lock-Box Account.
(j) Payment to Georgia Gulf. With respect to any Receivable
sold by Georgia Gulf to the Transferor, the Transferor shall, and shall cause
Georgia Gulf to, effect such sale under, and pursuant to the terms of, the
Receivables Purchase Agreement, including the payment by the Transferor
either in cash, by a capital contribution or by an increase in the amount of
the Subordinated Note (as defined in the Receivables Purchase Agreement) to
Georgia Gulf of an amount equal to the purchase price for such Receivable as
required by the terms of the Receivables Purchase Agreement.
35
SECTION 5.2. Negative Covenants of the Transferor and Georgia Gulf.
During the term of this Agreement, unless the Company shall otherwise consent
in writing:
(a) No Sales, Transfers, Liens, etc. Except as otherwise
provided herein and in the Receivables Purchase Agreement, neither the
Transferor nor Georgia Gulf will sell, transfer, assign (by operation of law
or otherwise) or otherwise dispose of, or create or suffer to exist any
Adverse Claim upon (including the filing of any financing statement) or with
respect to, any Receivable or related Contract, or upon or with respect to
any account which concentrates in a Lock-Box Bank to which any Collections of
any Receivable are sent, or assign any right to receive income in respect
thereof.
(b) No Extension or Amendment of Receivables. Neither the
Transferor nor Georgia Gulf will extend, amend or otherwise modify the terms
of any Receivable, or amend, modify or waive any term or condition of any
Contract related thereto, without the prior written consent of the Company if
such amendment, modification or waiver might result in a Material Adverse
Effect, or would breach any of their respective representations, warranties
or covenants under this Agreement.
(c) Change in Business or Credit Policy. Neither the
Transferor nor Georgia Gulf will make any change in the character of its
business or in the Credit Policy, which change might result in a Material
Adverse Effect.
(d) Use of Proceeds. No proceeds of any Transfer will be
used by the Transferor or Georgia Gulf to purchase or carry any margin stock
(as defined in Regulation U of the Board of Governors of the Federal Reserve
System) in violation of Regulations T, U or X of the Board of Governors of
the Federal Reserve System.
(e) No Mergers, Etc. Neither the Transferor nor Georgia
Gulf will (i) consolidate or merge with or into any other Person, (ii) sell,
lease or transfer all or substantially all of its assets to any other person
(except with respect to the Transferor, to the Company hereunder) or (iii)
enter into any plan of liquidation, partial liquidation, spin-off or
split-off.
(f) Change in Payment Instructions to Obligors. Neither the
Transferor nor Georgia Gulf will add or terminate any bank as a Lock-Box Bank
or any account as a Lock-Box Account to or from those listed in Exhibit C
hereto or make any change in its instructions to Obligors regarding payments
to be made to any Lock-Box Account, unless (i) such instructions are to
deposit such payments to another existing Lock-Box Account or (ii) the
Company shall have received written notice of such addition, termination or
change (including any change in the officer or agent of the Transferor or
Georgia Gulf executing the related Lock-Box Notice) at least 30 days prior
thereto and the Company shall have received a Lock-Box Notice executed by
each new
36
Lock-Box Bank or an existing Lock-Box Bank with respect to each new Lock-Box
Account, as applicable.
(g) Deposits to Lock-Box Accounts. Neither the Transferor
nor Georgia Gulf will 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.
(h) Change of Name, Etc. Neither the Transferor nor Georgia
Gulf will change its name, identity or structure or its chief executive
office, unless, at least 10 days prior to the effective date of any such
change, the Transferor or Georgia Gulf, as applicable, delivers to the
Company (i) UCC financing statements, executed by the Transferor or Georgia
Gulf (as applicable), necessary to reflect such change and to continue the
perfection of the Company's or Transferor's, as applicable, ownership
interests or security interests in the Receivables and the Residual
Receivable Interest and Collections with respect thereto and (ii) new or
revised Lock-Box Notices executed by the Lock-Box Banks which reflect such
change and enable the Company to continue to exercise its rights contained in
Section 2.8.
(i) Sale Treatment. The Transferor will not and will not
permit Georgia Gulf to, (i) account for (including for financial reporting
purposes), or otherwise treat, the transactions contemplated by the
Receivables Purchase Agreement in any manner other than as a sale of
Receivables by Georgia Gulf to the Transferor, or (ii) account for (other
than for tax purposes) or otherwise treat the transactions contemplated
hereby in any manner other than a sale of Receivables by the Transferor to
the Company. In addition, the Transferor shall, and shall cause Georgia Gulf
to, disclose (in a footnote or otherwise) in all of its respective financial
statements (including any such financial statements consolidated with any
other Persons' financial statements) the existence and nature of the
transactions contemplated hereby and by the Receivables Purchase Agreement
and the interest of the Transferor (in the case of Georgia Gulf's financial
statements) and the Company in the Transferred Property.
(j) Separate Business. The Transferor shall at all times
comply in all respects with Articles X, XV and XVII of its Certificate of
Incorporation. The officers and directors of the Transferor (as appropriate)
shall make decisions with respect to the business and daily operations of the
Transferor independent of and not dictated by any controlling entity. The
Transferor shall not engage in any business not permitted by its Certificate
of Incorporation as in effect on the Closing Date.
(k) Corporate Documents. The Transferor shall only amend,
alter, change or repeal its Certificate of Incorporation with the prior
written consent of the Administrative Agent.
37
ARTICLE VI
ADMINISTRATION AND COLLECTIONS
SECTION 6.1. Appointment of Collection Agent; Collection Agent Fee. The
servicing, administering and collection of the Receivables shall be conducted by
such Person (the "Collection Agent") so designated from time to time in
accordance with this Section 6.1. Until the Company gives notice to Georgia Gulf
of the designation of a new Collection Agent, Georgia Gulf is hereby designated
as, and hereby agrees to perform the duties and obligations of, the Collection
Agent pursuant to the terms hereof. The Company may, upon the occurrence of a
Termination Event (other than a Termination Event solely with respect to Section
7.1(n), but including any Termination Event under Subsections 7.1(a) and 7.1(c)
regardless of whether Georgia Gulf is then serving as the Collection Agent) (i)
designate as Collection Agent any Person (including itself) to succeed Georgia
Gulf or any successor Collection Agent, on the condition in each case that any
such Person so designated shall agree to perform the duties and obligations of
the Collection Agent pursuant to the terms hereof and (ii) notify any Obligor of
the Transferred Interest. For the period Georgia Gulf serves as the Collection
Agent, the Receivables Purchase Agreement provides that the Collection Agent
shall receive one Collection Agent Fee (the "Collection Agent Fee") of 0.50% per
annum, payable monthly on the aggregate amount of Receivables sold, provided,
however, that if a successor Collection Agent is appointed that is not a Georgia
Gulf Affiliate, such successor shall receive a Collection Agent Fee of 1.00% per
annum payable monthly.
SECTION 6.2. Duties of Collection Agent.
(a) The Collection Agent shall take or cause to be taken
all such action as may be necessary or advisable to collect each Receivable
from time to time, in accordance with all applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Credit Policy. Each of the Transferor and the Company hereby appoints as its
agent the Collection Agent, from time to time designated pursuant to Section
6.1, to enforce their respective rights and interests in and under the
Receivables, the Residual Receivable Interest, the Collections and the
Contracts. The Collection Agent shall set aside for the account of the
Transferor and the Company their respective allocable shares of the
Collections of Receivables in accordance with Sections 2.5 and 2.6. The
Collection Agent shall segregate and deposit to the Company's account the
Company's allocable share of Collections of Receivables when required
pursuant to Article II hereof. The Transferor and Georgia Gulf shall deliver
to the Collection Agent, and the Collection Agent shall hold in trust for the
Transferor and the Company in accordance with their respective interests, all
Records which evidence or relate to Receivables, the Residual Receivable
Interest or Collections. Notwithstanding anything to the contrary contained
herein, the Company shall have the absolute and unlimited right to direct the
Collection Agent (whether the Collection Agent is Georgia Gulf or any other
38
Person) to commence or settle any legal action to enforce collection of
any Receivable or to foreclose upon or repossess any Residual Receivable
Interest.
(b) The Collection Agent shall hold, for the benefit of the
Transferor, Collections received minus the Percentage Factor of such
Collections. On the last day of each Tranche Period, the Collection Agent
shall deduct from such Collections and pay to the Company in reduction of the
Aggregate Net Investment and accrued Discount and any amounts due under
Section 2.9 hereof and unpaid from the Transferor and turn the remainder of
such Collections over to the Transferor. In addition, the Collection Agent
shall, as soon as practicable following receipt thereof, turn over to the
Transferor any collections of any indebtedness of any Obligor which is not a
Receivable. The Collection Agent, if other than the Transferor, shall as soon
as practicable upon demand, deliver to the Transferor all Records in its
possession which evidence or relate to indebtedness of an Obligor which is
not a Receivable or the Residual Receivable Interest.
(c) On or before 90 days after the end of each fiscal year
of the Collection Agent, beginning with December 31, 1998, the Collection
Agent shall cause a firm of nationally recognized independent public
accountants (who may also render other services to the Collection Agent,
Georgia Gulf or the Transferor) to furnish a report to the Company
substantially to the effect that (i) such accountants have performed certain
agreed upon procedures related to certain documents and records relating to
the servicing of the Receivables under this Agreement, compared on a test
basis the information contained in the Monthly Reports delivered pursuant to
Section 2.11 during the period covered by such reports with such documents
and records and that, on the basis of such procedures, and subject to such
limitations and qualifications as may be reasonably and customarily set forth
in such report, that the servicing has been conducted substantially in
compliance with the terms and conditions as set forth in this Agreement,
except for such exceptions as they believe to be immaterial and such other
exceptions as shall be set forth in such statement and (ii) such accountants
have compared on a test basis the mathematical calculations of the amounts
set forth in the Monthly Reports delivered pursuant to Section 2.11 during
the period covered by such reports, with the Transferor's and Collection
Agent's computer reports which were the source of such amounts and that, on
the basis of such comparison, such accountants are of the opinion that such
amounts are in agreement, except for such exceptions as they believe to be
immaterial and such other exceptions as shall be set forth in such statement.
(d) Notwithstanding anything to the contrary contained in
this Article VI, the Collection Agent, if not Georgia Gulf, shall have no
obligation to collect, enforce or take any other action described in this
Article VI with respect to any Receivable that is not included in the
Transferred Interest other than to deliver to the Transferor the Collections
and documents with respect to any such Receivable as described in Section
6.2(b).
39
SECTION 6.3. Rights After Designation of New Collection Agent. At any
time following the designation of a Collection Agent (other than Georgia Gulf)
pursuant to Section 6.1:
(i) The Company may direct that payment of all amounts payable
under any Receivable be made directly to the Company or its designee.
(ii) The Transferor shall, at the Company's request and at the
Transferor's expense, give notice of the Company's ownership of
Receivables to each Obligor and direct that payments be made directly
to the Company or its designee.
(iii) The Transferor shall, at the Company's request, (A)
assemble all of the Records, and shall make the same available to the
Company at a place selected by the Company or its designee, and (B)
segregate all cash, checks and other instruments received by it from
time to time constituting Collections of Receivables in a manner
acceptable to the Company and shall, promptly upon receipt, remit all
such cash, checks and instruments, duly endorsed or with duly executed
instruments of transfer, to the Company or its designee.
(iv) Each of Georgia Gulf and the Transferor hereby authorizes
the Company to take any and all steps in the Transferor's name and
Georgia Gulf's name and on behalf of the Transferor and Georgia Gulf,
as applicable, necessary or desirable in the determination of the
Company, to collect all amounts due under any and all Receivables,
including endorsing the Transferor's name and Georgia Gulf's name on
checks and other instruments representing Collections and enforcing
such Receivables and the related Contracts.
SECTION 6.4. Responsibilities of the Transferor and Georgia Gulf.
Anything herein to the contrary notwithstanding, each of the Transferor and
Georgia Gulf shall (i) perform all of its obligations under the Contracts
related to the Receivables to the same extent as if such Receivables had not
been sold hereunder, and the exercise by the Company of its rights hereunder
shall not relieve the Transferor and Georgia Gulf from such obligations and (ii)
pay when due any taxes of the Transferor and Georgia Gulf, including all sales
taxes payable in connection with the Receivables. The Company shall not have any
obligation or liability with respect to any Receivable or related Contracts, nor
shall it be obligated to perform any of the obligations of the Transferor and
Georgia Gulf thereunder.
SECTION 6.5. Lock-Box Notices. From and after the occurrence of a
Potential Termination Event, the Company is hereby authorized at any time to
date, and to deliver to the Lock-Box Banks, the Lock-Box Notices delivered
hereunder; provided that for so long as this Agreement is in full force and
effect and a Potential Termination Event has not occurred, the Company hereby
covenants and agrees with the Transferor and Georgia
40
Gulf that it will hold any such Lock-Box Notice provided by the Transferor and
Georgia Gulf to the Company in safekeeping. Each of the Transferor and Georgia
Gulf, when the Company shall deliver the Lock-Box Notices to the Lock-Box Banks,
hereby transfers to the Company the exclusive ownership and control of the
Lock-Box Accounts to which the Obligors of Receivables shall make payments and
in which Collections may be concentrated, and shall take any further action that
the Company may reasonably request, to effect such transfer. In case any
authorized signatory of the Transferor or Georgia Gulf whose signature shall
appear on any Lock-Box Notice shall cease to have such authority before the
delivery of such Lock-Box Notice, such signature shall nevertheless be valid and
sufficient for all purposes as if such authority had remained in force at the
time of such delivery. Notwithstanding the delivery of such Lock-Box Notices,
the Collection Agent shall continue to comply with the provisions of this
Section 6.5.
ARTICLE VII
TERMINATION EVENTS
SECTION 7.1. Termination Events. The occurrence of any one or
more of the following events shall constitute a Termination Event:
(a) the Transferor, Georgia Gulf or the Collection Agent
(provided, except for purposes of Section 6.1 only, Georgia Gulf is the
Collection Agent) shall fail to perform or observe any term, covenant,
agreement or undertaking hereunder (other than as referred to in clause (c)
below) and such failure shall remain unremedied for two Business Days after
written notice thereof has been given to the Transferor, Georgia Gulf or the
Collection Agent, as applicable, by the Company; or
(b) any representation, warranty, certification or
statement made by the Transferor or Georgia Gulf in this Agreement or in any
other document delivered pursuant hereto or in connection herewith, including
the Receivables Purchase Agreement and the Credit Agreement, shall prove to
have been incorrect in any material respect when made or deemed made and such
condition shall continue unremedied for a period of five days; or
(c) any event or occurrence that has a material adverse
effect on Georgia Gulf, the Transferor or on Blue Ridge or any Affiliates
thereof to perform in all material respects their respective obligations
hereunder under the Receivables Purchase Agreement or any related agreement,
including the Credit Agreement, or on the status, existence, perfection,
priority or enforceability of Blue Ridge's interest in the Receivables; or
(d) either the Transferor, Georgia Gulf or the Collection
Agent (provided, except for purposes of Section 6.1 only, Georgia Gulf is the
Collection Agent)
41
shall fail, for a period of two Business Days, to make any
payment or deposit to be made by it hereunder when due; or
(e) (i) failure of the Transferor, Georgia Gulf or any of
their respective Subsidiaries to pay any Indebtedness (other than
Indebtedness subject to a good faith dispute) when due; or (ii) any
Indebtedness (other than Indebtedness subject to a good faith dispute) shall
be declared to be due and payable or required to be prepaid (other than by a
regularly scheduled payment) prior to the date of maturity thereof (other
than any acceleration arising out of a good faith dispute), and such
condition shall continue unremedied for a period of two Business Days; or
(f) (i) the Transferor, Georgia Gulf or any of their
respective 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 the Transferor, Georgia Gulf or any of
their respective Subsidiaries, or 30 days shall have elapsed since the
commencement of any proceeding against the Transferor, Georgia Gulf or any of
their respective Subsidiaries (which proceeding shall not have been
dismissed), seeking to adjudicate it as 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 or
other similar official for it or any substantial part of its property, or
(ii) the Transferor, Georgia Gulf or any of their respective Subsidiaries
shall take any corporate action to authorize any of the actions set forth in
clause (i) above in this subsection (e); or
(g) the institution of any litigation, arbitration
proceedings or governmental proceeding involving the Transferor, Georgia
Gulf, any of their respective Subsidiaries or the Receivables which may have
a Material Adverse Effect; or
(h) the entry of any judgment or decree against the
Transferor, Georgia Gulf or any of their respective Subsidiaries if the
aggregate amount of all judgments and decrees then outstanding against any of
them or their Subsidiaries for which insurance is not available and the
collection of which has not been stayed, might result in a Material Adverse
Effect; or
(i) a change in the majority ownership of the voting stock
of Georgia Gulf or the Transferor shall have occurred, or Georgia Gulf or the
Transferor shall enter into any transaction, merger, consolidation or sale of
all or substantially all its assets whereby it is not the surviving entity; or
(j) the Default Ratio (averaged over the previous three
consecutive months) shall exceed 2.5% or the Delinquency Ratio (averaged over
the previous three consecutive months) shall exceed 2.5%; or
42
(k) the Net Receivables Balance shall be less than the
Coverage Amount and such failure shall remain unremedied for five consecutive
Business Days thereafter; or
(l) the Aggregate Net Investment plus Discount exceeds the
Facility Limit, and the Aggregate Net Investment plus Discount is not reduced
by the Transferor by the payment of cash to the Company to an amount not more
than the Facility Limit within five business days following notice from the
Company; or
(m) an Event of Default (as defined by the Credit
Agreement) shall have occurred under the Credit Agreement; or
(n) the Company is unable to obtain liquidity loans under
the Liquidity Facility in support of Commercial Paper issued or to be issued
by or on behalf of the Company in connection with the transactions
contemplated by this Agreement; or
(o) the Receivables Purchase Agreement shall have
terminated in accordance with the terms of Article VIII thereof; or
(p) the Internal Revenue Service, the Pension Benefit
Guaranty Corporation or any other governmental authority files notice of a
lien with respect to taxes of $1,000,000 or more with respect to the
Receivables and such lien is not released within 30 days; or
(q) Georgia Gulf, Blue Ridge or any successor or assign
becomes an "investment company" within the meaning of the 1940 Act.
SECTION 7.2. Termination. If a Termination Event occurs, (i) the
Company may, by notice to the Transferor, declare all outstanding Tranche
Periods to be ended and designate the Tranche Rate applicable to the Aggregate
Net Investment plus the Discount, (ii) the Company shall have no further
obligation to make any Advances hereunder or otherwise fund any transfers of
Receivables, and the Facility Limit shall be reduced on each day thereafter to
the aggregate, as of the preceding day, of the Aggregate Net Investment plus the
Discount, (iii) the Company may cease to issue or cause to be issued Commercial
Paper or obtain liquidity loans for the purpose of reinvestment from the
Liquidity Bank under the Liquidity Facility, (iv) if Georgia Gulf is the
Collection Agent at the time, the Company may terminate Georgia Gulf as
Collection Agent and appoint a new Collection Agent, which may be the Company,
Wachovia Bank, N.A. or any affiliate of either, and (v) the Company shall have
all of the rights and remedies provided to a secured creditor or a transferee
under the Relevant UCC and applicable local law.
ARTICLE VIII
43
INDEMNIFICATION
SECTION 8.1. Indemnities by the Transferor. Without limiting any other
rights which the Company may have hereunder or under applicable law, the
Transferor hereby agrees to hold harmless and indemnify the Company and the
Administrative Agent and their respective officers, directors, agents and
employees from and against any and all damages, losses, claims, liabilities,
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 the Company and/or the Administrative Agent
arising out of or as a result of this Agreement or the ownership, either
directly or indirectly, by the Company of the Transferred Interest excluding,
however, (i) Indemnified Amounts to the extent resulting from gross negligence
or willful misconduct on the part of the Company and/or the Administrative Agent
or (ii) recourse (except as otherwise specifically provided in this Agreement)
for uncollectible Receivables. Without limiting the generality of the foregoing,
the Transferor shall hold harmless and indemnify the Company and the
Administrative Agent for Indemnified Amounts relating to or resulting from:
(a) reliance on any representation or warranty made by the
Transferor (or any of its officers) under or in connection with this
Agreement or any other information or report delivered by or on behalf of the
Transferor pursuant hereto, which shall have been false or incorrect in any
material respect when made or deemed made;
(b) the failure by the Transferor or the Collection Agent
to comply with any applicable law, rule or regulation with respect to any
Receivable or the related Contract, or the nonconformity of any Receivable or
the related Contract with any such applicable law, rule or regulation;
(c) the failure to vest and maintain vested in the Company
or the Liquidity Bank, as applicable, the Transferred Interest in the
Receivables free and clear of any Adverse Claim;
(d) the failure to file, or delay in filing, financing
statements or other similar instruments or documents under the UCC or the
laws of any applicable jurisdiction or other applicable laws with respect to
any Receivable;
(e) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment of any
Receivable (including, without limitation, a defense based on such Receivable
or the related Contract not being a legal, valid and binding obligation of
such Obligor enforceable against it in accordance with its terms), or any
other claim resulting from the sale of products or services related to such
Receivable or the furnishing or failure to furnish such products or services;
44
(f) any failure of the Transferor or the Collection Agent
to perform its duties or obligations in accordance with the provisions of
this Agreement;
(g) any products liability claim, environmental liability
claim, or personal injury or property damage suit or other similar or related
claim or action of whatever sort arising out of or in connection with
products or services which are the subject of any Receivable;
(h) the transfer of an undivided percentage ownership
interest in any Receivable other than an Eligible Receivable, if, on the date
of such transfer the Net Receivables Balance was less than the Coverage
Amount; or
(i) the inability of the Company after using all reasonable
efforts to sell or cause to be sold Commercial Paper to fund any CP Tranche
requested by the Transferor.
If the Company and/or the Administrative Agent enter into
agreements for the transfer of interests in receivables from one or more other
Persons ("Other Transferors"), the Company and the Administrative Agent shall
allocate such Indemnified Amounts which are attributable to the Transferor and
to the Other Transferors to the Transferor and each Other Transferor; provided,
however, that if such Indemnified Amounts are attributable to the Transferor and
not attributable to any Other Transferor, the Transferor shall be solely liable
for such Indemnified Amounts or if such Indemnified Amounts are attributable to
Other Transferors and not attributable to the Transferor, such Other Transferors
shall be solely liable for such Indemnified Amounts.
SECTION 8.2. Tax Indemnification. The Transferor and the Collection
Agent hereby agree to pay, and to indemnify the Company and the Administrative
Agent from and against, any taxes which may at any time be asserted in respect
of this transaction or the subject matter hereof or any funding agreement or the
subject matter thereof (including any sales, gross receipts, general
corporation, personal property, privilege or license taxes, but not including
any federal or (except as provided below) other income taxes imposed upon the
Company and/or the Administrative Agent, with respect to its net income or
profits arising out of the transactions contemplated hereby), whether arising by
reason of the acts to be performed by the Transferor hereunder or imposed
against the Transferor, or the Company and/or the Administrative Agent, the
property involved or otherwise. If any tax, fee or similar charge measured by
net income or profits is imposed or with respect to any payment for the account
of the Company or the Administrative Agent provided for in this Agreement by any
State or political subdivision thereof (other than income taxes of the Company),
the Transferor will, upon demand by the Company or the Administrative Agent, pay
an amount necessary to make the Company and/or the Administrative Agent whole,
taking into account any tax consequences to the Company of the payment of such
tax and the receipt of the indemnity provided for by this Section 8.2, including
the effect of such tax or refund on the amount of tax measured by net
45
income or profits which is or was payable by the Company and/or the
Administrative Agent in the jurisdiction in which its principal executive office
is located, provided, however, that if the Company and/or the Administrative
Agent enters into agreements for the transfer of interests in receivables from
Other Transferors, the Company shall allocate among the Transferor and such
Other Transferors any amounts owing under this Section 8.2 which are
attributable to the Transferor or to the Other Transferors ("Section 8.2
Costs"); provided, further, that if such Section 8.2 Costs are attributable to
the Transferor and not attributable to any other Transferor, the Transferor
shall be solely liable for such Section 8.2 Costs or if such Section 8.2 Costs
are attributable to Other Transferors and not attributable to the Transferor,
such Other Transferors shall be solely liable for such Section 8.2 Costs; and
provided, further, that such Section 8.2 Costs shall include any amounts the
Company and/or the Administrative Agent must pay to the Liquidity Bank pursuant
to the Liquidity Facility on account of any tax described in this Section 8.2
and applicable to the Liquidity Bank.
SECTION 8.3. Additional Costs.
(a) The Transferor shall pay to the Company from time to
time on demand of the Company such amounts as the Company and/or the
Administrative Agent may reasonably determine to be necessary to compensate
it for any increase in costs which the Company determines are attributable to
its making a Transfer or maintaining any Tranche under this Agreement or its
obligation to make any such Transfer or reinvestment hereunder, or any
reduction in any amount receivable by the Company hereunder in respect of any
such Tranche or such obligation (such increases in costs, payments and
reductions in amounts receivable being herein called "Additional Costs")
resulting from any Regulatory Change which (i) changes the method or basis of
taxation of (A) any amounts payable to the Company under this Agreement in
respect of any such Tranche or (B) such amounts when considered together with
any amounts to be paid by the Company in respect of its Commercial Paper
notes relating to such Tranche, (ii) imposes or modifies any reserve, special
deposit, deposit insurance or assessment, capital or similar requirements
relating to any extensions of credit or other assets of, or any deposits with
or other liabilities of, the banks that are parties to the Liquidity
Facility, or (iii) imposes any other condition affecting this Agreement (or
any of such extensions of credit or liabilities). The Company will notify the
Transferor of any event that will entitle the Company to compensation
pursuant to this Section 8.3(a) as promptly as practicable after it obtains
knowledge thereof.
(b) Without limiting the effect of the foregoing provisions
of this Section 8.3 (but without duplication), the Transferor shall pay to
the Company from time to time on demand of the Company such amounts as the
Company may reasonably determine to be necessary to compensate it for any
costs which the Company determines are attributable to its making a Transfer
or maintaining any Tranche under this Agreement or its obligation to make any
transfers or reinvestments hereunder, in respect of any amount of capital
maintained by the banks that are parties to the Liquidity Facility
46
pursuant to any law or regulation of any jurisdiction or any interpretation,
directive or request (whether or not having the force of law) of any court or
governmental or monetary authority, whether in effect on the date of this
Agreement or thereafter or in respect of any costs or expenses incurred by the
Company under the Liquidity Facility. The Company will notify the Transferor if
the Company is entitled to compensation pursuant to this Section 8.3(b) as
promptly as practicable after it obtains knowledge of such event or condition.
(c) Determinations and allocations by the Company for
purposes of this Section 8.3 shall be conclusive, provided that such
determinations and allocations are made in good faith and on a reasonable
basis, reasonable evidence (including an explanation of the applicable
Regulatory Change and an accounting for any amounts demanded) of which shall
be provided to the Transferor upon request.
(d) Anything in this Section 8.3 to the contrary
notwithstanding, if the Company enters into agreements for the transfer of
interests in receivables from Other Transferors, the Company shall allocate
the liability for any amounts under this Section 8.3 ("Section 8.3 Costs") to
the Transferor and each Other Transferor which is attributable to the
Transferor, which amounts shall be paid by the Transferor or to the Other
Transferors; and provided, further, that if such Section 8.3 Costs are
attributable to the Transferor and not attributable to any Other Transferor,
the Transferor shall be solely liable for such Section 8.3 Costs, or if such
Section 8.3 Costs are attributable to Other Transferors and not attributable
to the Transferor, such Other Transferors shall be solely liable for such
Section 8.3 Costs.
SECTION 8.4. Other Costs and Expenses. The Transferor shall pay on
demand all costs and expenses in connection with the preparation, execution,
delivery and administration of this Agreement, any operating agreement, any
funding agreement by and between the Company, the Administrative Agent and any
financial institution and the other documents to be delivered hereunder,
including reasonable fees and charges of legal counsel for the Company, the
Administrative Agent and the financial institution party to such funding
agreement (which such counsel may be employees of the Company, the
Administrative Agent or such financial institution) with respect thereto and
with respect to advising the Company, the Administrative Agent, and any such
financial institution as to its rights and remedies under this Agreement, any
operating agreement and any funding agreement, respectively, and all costs and
expenses, if any, including reasonable counsel's fees and expenses in connection
with the enforcement or amendment of this Agreement and the other documents
delivered hereunder. The Transferor shall reimburse the Company and the
Administrative Agent immediately on demand for any amounts the Company and/or
the Administrative Agent must pay to any financial institution pursuant to any
funding agreement on account of any tax described in Section 8.2 and applicable
to such financial institution. The Transferor shall reimburse the Company and/or
the Administrative Agent for any and all commissions of placement agents and
commercial paper dealers in respect of Commercial Paper issued to fund any CP
Tranche hereunder.
47
The Transferor shall reimburse the Company and the Administrative Agent on
demand for all other costs and expenses incurred by the Company and/or the
Administrative Agent or any shareholder of the Company and/or the Administrative
Agent, including reasonable counsel's fees and expenses incurred in connection
with the enforcement of, or amendment to, this Agreement and any documents
related hereto, to the extent such fees, costs and expenses are incurred in
respect of such enforcement or amendment by or in respect of the Transferor
("Other Costs") (provided that with respect to legal fees of the Company and the
Administrative Agent incurred in connection with the negotiation and
implementation of this Agreement, the Transferor shall be obligated to pay such
fees, together with any reasonable charges of such counsel); provided, however,
that if the Company or the Administrative Agent enters into agreements for the
transfer of interests in receivables from Other Transferors, the Company or the
Administrative Agent shall allocate the liability for such Other Costs to the
Transferor and each Other Transferor; and provided, further, that if such Other
Costs are attributable to the Transferor and not attributable to any Other
Transferor, the Transferor shall be solely liable for such Other Costs or if
such Other Costs are attributable to Other Transferors and not attributable to
the Transferor, such Other Transferors shall be solely liable for such other
Costs.
SECTION 8.5. Reconveyance Under Certain Circumstances. The Transferor
agrees to accept the reconveyance from the Company of a particular portion of
the Transferred Interest if the Company notifies the Transferor of a breach of
any representation or warranty made or deemed made at the time of such Transfer
pursuant to Article III of this Agreement, with respect to such portion of the
Transferred Interest and the Transferor shall fail to cure such breach with
respect to such portion within five days after becoming aware thereof. The
reconveyance price shall be paid by the Transferor to the Company in immediately
available funds on such day in an amount equal to the Outstanding Balance of the
Receivables related to such portion of the Transferred Interest.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. Term of Agreement. This Agreement shall terminate
following the Termination Date when all Aggregate Unpaids have been paid in
full; provided, however, that (i) the rights and remedies of the Company with
respect to any representation and warranty made or deemed to be made by
Transferor and Georgia Gulf pursuant to this Agreement and (ii) the
indemnification and payment provisions of Article VIII, shall be continuing and
shall survive any termination of this Agreement, subject to applicable statutes
of limitation.
SECTION 9.2. Waivers; Amendments. No failure or delay on the part of
the Company in exercising any power, right or remedy under this Agreement shall
operate as
48
a waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other further exercise thereof or the exercise
of any other power, right or remedy. The rights and remedies herein provided
shall be cumulative and nonexclusive of any rights or remedies provided by
law. Any provision of this Agreement may be amended if, but only if, such
amendment is in writing and is signed by the Transferor, Georgia Gulf and the
Company.
SECTION 9.3. Notices. Except as provided below, all communications and
notices provided for hereunder shall be in writing (including bank wire, telex,
telecopy or electronic facsimile transmission or similar writing) and shall be
given to the other party at its address or facsimile set forth below. Each such
notice or other communication shall be effective if given by facsimile, when
such facsimile is transmitted to the facsimile number specified in this Section
9.3 and the appropriate answerback or written confirmation is received, if given
by any other means when received at the address specified in this Section 9.3.
However, anything in this Section 9.3 to the contrary notwithstanding, the
Transferor hereby authorizes the Company to effect Transfers, Tranche Period and
Tranche Rate selections based on telephonic notices made by any Person which the
Company in good faith believes to be acting on behalf of the Transferor. The
Transferor agrees to deliver promptly to the Company a written confirmation of
each telephonic notice signed by an authorized officer of Transferor. However,
the absence of such confirmation shall not affect the validity of such notice.
If the written confirmation differs in any material respect from the action
taken by the Company, the records of the Company shall govern, absent manifest
error.
If to the Transferor:
---------------------
GGRC CORP.
000 Xxxxxxxxx Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to Georgia Gulf:
-------------------
GEORGIA GULF CORPORATION
000 Xxxxxxxxx Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
49
If to the Company:
------------------
BLUE RIDGE ASSET FUNDING CORPORATION
c/o Wachovia Bank, N.A.
000 Xxxxxxxxx Xxxxxx, XX-000
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx, Administrative Specialist
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to the Administrative Agent:
-------------------------------
WACHOVIA BANK, N.A.
000 Xxxxxxxxx Xxxxxx, XX-000
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx, Administrative Specialist
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
SECTION 9.4. Governing Law; Submission to Jurisdiction; Integration.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Georgia. Each of the Transferor and Georgia Gulf hereby submits to
the nonexclusive jurisdiction of the United States District Court for the
Northern District of Georgia and of any Georgia State Court sitting in such
Northern District of Georgia for purposes of all legal proceedings arising out
of or relating to this Agreement or the transactions contemplated hereby. Each
of the Transferor and Georgia Gulf hereby irrevocably waives, to the fullest
extent it may effectively do so, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum. Nothing in this Section 9.4 shall affect the right of
the Company to bring any action or proceeding against the Transferor, Georgia
Gulf or their respective properties in the courts of other jurisdictions. This
Agreement contains the final and complete integration of all prior expressions
by the parties hereto with respect to the subject matter hereof and shall
constitute the entire Agreement among the parties hereto with respect to the
subject matter hereof superseding all prior oral or written understandings.
SECTION 9.5. Severability; Counterparts. Any provisions of this
Agreement which are prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. This Agreement
may be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be
50
deemed to be an original and all of which when taken together shall constitute
one and the same Agreement.
SECTION 9.6. Assignments. This Agreement shall be binding on the
parties hereto and their respective successors and assigns; provided, however,
that neither the Transferor nor Georgia Gulf may assign any of its rights or
delegate any of its duties hereunder without the prior written consent of the
Company. No provision on this Agreement shall in any manner restrict the ability
of the Company to assign, participate, grant security interests in, or otherwise
transfer any portion of the Transferred Interest.
SECTION 9.7. Confidentiality.
(a) Each of the Transferor and Georgia Gulf hereby consents
to the disclosure of any non-public information with respect to it to (i) the
Company by the others and (ii) the Liquidity Bank (or any prospective or actual
participant in the Liquidity Facility) by the Company.
(b) Each of the Transferor and Georgia Gulf shall
maintain, and shall cause each of its officers, employees and agents to
maintain, the confidentiality of this Agreement, all documents related hereto
and all other confidential proprietary information with respect to the Company
and its successors and assigns, the Liquidity Bank and each of their respective
businesses, obtained by them in connection with the structuring, negotiation and
execution of the transactions contemplated herein, except for information that
has become publicly available and has been disclosed to (i) legal counsel,
accountants and other professional advisors to the Transferor and Georgia Gulf,
(ii) as required by law, regulation or legal process, and (iii) in connection
with any legal or regulatory proceeding to which the Transferor and/or Georgia
Gulf is subject. The Company hereby consents to the disclosure of information in
the manner and to the Persons set forth in clauses (i) through (iii) above.
SECTION 9.8. No Bankruptcy Petition Against the Company. Each of the
Transferor and Georgia Gulf hereby covenants and agrees that, prior to the date
which is one year and one day after the date upon which all outstanding
Commercial Paper is paid in full, it will not institute against, or join any
other Person in instituting against, the Company any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceeding
under the laws of any jurisdiction.
SECTION 9.9. Limited Recourse; Waiver of Setoff.
(a) Notwithstanding anything to the contrary contained
herein, the obligations of the Company under this Agreement are solely the
corporate obligations of the Company and shall be payable at such time as funds
are received from the Transferor, Georgia Gulf and other transferors or from any
party to any agreement with the Company in accordance with the terms thereof in
excess of funds necessary to pay matured and
51
maturing Commercial Paper and, to the extent funds are not available to pay such
obligations, the claims relating thereto shall continue to accrue. Each party
hereto agrees that the payment of any claim (as defined in Section 101 of Title
11 of the Bankruptcy Code) of any such party shall be subordinated to the
payment in full of all Commercial Paper. No recourse shall be had for the
payment of any amount owing in respect of any obligation of, or claim against,
the Company arising out of or based upon this Agreement against any stockholder,
employee, officer, director or incorporator of the Company or any Affiliate
thereof provided, however, that the foregoing shall not relieve any such person
or entity from any liability they might otherwise have as a result of fraudulent
actions or omissions taken by them.
(b) Each of the Transferor and Georgia Gulf hereby agrees
to waive any right of setoff which it may have or to which it may be entitled
against the Company and its assets.
SECTION 9.10. Tax Characterization of the Transactions Contemplated by
this Agreement. The Transferor and the Company agree to treat the transactions
contemplated by this Agreement as a financing for tax purposes and further agree
to file on a timely basis all federal and other income tax returns consistent
with such treatment.
52
IN WITNESS WHEREOF, the parties hereto have caused this Receivables
Transfer Agreement to be executed and delivered by their duly authorized
officers as of the date first above written.
GGRC CORP., as Transferor
By
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Treasurer
GEORGIA GULF CORPORATION,
individually and as Collection Agent
By
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Corporate Controller
BLUE RIDGE ASSET FUNDING
CORPORATION,
as Company
By
----------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Senior Vice President
53
EXHIBIT A
FORM OF CONTRACT
A-1
EXHIBIT B
CREDIT POLICY
B-1
EXHIBIT C
LIST OF LOCK-BOX BANKS
Bank Account Number
Wachovia Bank, N.A 00-000-000
000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxx, Xxxxxxx 00000-0000
Attn: Xxxxxxx X. XxXxxxx
Tel: (000) 000-0000
Customers make payments to:
Georgia Gulf Corporation
X.X. Xxx 00000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Xxxxxxx X. XxXxxxx
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Lock-Box #: 75250 (Data transmission)
75259 00-000-000
C-1
EXHIBIT D
FORM OF LOCK-BOX NOTICE
______________________, 19___
[Name and Address of
Lock-Box Bank]
Ladies and Gentlemen:
We hereby notify you that we have transferred exclusive ownership and
control of our lock-box account[s] no[s]. __________ maintained with you (the
"Lock-Box Account[s]") to Blue Ridge Asset Funding Corporation, c/o Wachovia
Bank, N.A., 000 Xxxxxxxxx Xxxxxx, XX-000, Xxxxxxx, Xxxxxxx 00000 (the
"Company").
We hereby irrevocably instruct you to make all payments to be made by
you out of or in connection with the Lock-Box Account[s] directly to Wachovia
Bank, N.A., [_______] Branch, Account no. ____ in the name of the Company, for
the account of the Company, or otherwise in accordance with the instructions of
the Company.
We also hereby notify you that the Company shall be irrevocably
entitled to exercise any and all rights in respect of or in connection with the
Lock-Box Account[s], including, without limitation, the right to specify when
payments are to be made out of or in connection with the Lock-Box Account[s].
Please agree to the terms of, and acknowledge receipt of, this notice
by signing in the space provided below on two copies hereto sent herewith and
send one signed copy to the Company, at its address referred to above,
Attention: Xxxxxxx X. Xxxxxxxx, Administrative Specialist, and send the other
signed copy via overnight courier to the undersigned at its address at
________________________, Attention of ____________________. In addition, please
furnish a copy to Wachovia Bank, N.A., 000 Xxxxxxxxx Xxxxxx, XX-000, Xxxxxxx,
Xxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx, Administrative Specialist.
Very truly yours,
-----------------------------
By:
-------------------------
Name:
Title:
Agreed and acknowledged:
[NAME OF BANK]
By:
---------------------------
Name:
Title:
E-2
EXHIBIT E
FORM OF MONTHLY REPORT
E-1
EXHIBIT F
FORM OF TRANCHE SELECTION NOTICE
GGRC CORP.
000 Xxxxxxxxx Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Transfer Notice Date:______________________
Blue Ridge Asset Funding Corporation
c/o Wachovia Bank, N.A.
000 Xxxxxxxxx Xxxxxx, XX-000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
TRANCHE SELECTION NOTICE
Dear Sir or Madam:
With reference to Section 2.2 of the Receivables Transfer Agreement,
dated as of March 10, 1998 (as amended, the "Transfer Agreement") by and among
Blue Ridge Asset Funding Corporation (the "Company"), GGRC Corp., (the
"Transferor") and Georgia Gulf Corporation, the Transferor hereby requests the
Company to accept the Transfer or maintain the Transfer of Receivables, as the
case may be, from the Transferor utilizing the proceeds of the following:
CP Tranche (A CP Tranche is automatically chosen unless otherwise specified).
Commercial Paper Face Value: -------------------
Transfer Date: -------------------
Maturity Date: -------------------
Eurodollar Tranche
Amount: -------------------
Transfer Date: -------------------
Maturity Date: -------------------
BR Tranche.
Amount: -------------------
Transfer Date: -------------------
F-1
Maturity Date: -------------------
Sincerely,
-------------------
Name:
Title:
F-2
EXHIBIT G
LIST OF TOP TEN OBLIGORS BY AGING
Georgia-Pacific
Allied Signal
Mitsui
Borden
Klockner Pentaplast
Genova
Puretec Corp
Xxxxxx & Sessions
Royal Plastics, Inc.
Imperial Chemical Industries
G-1
EXHIBIT H
LIST OF ACTIONS/SUITS
None
H-1
EXHIBIT I
SCHEDULE OF LOCATION OF RECORDS
Georgia Gulf Corporation
Xxxxxxx 000
Xxxxxxxxxx, Xxxxxxxxx 00000
Attention: Credit Department
Georgia Gulf Corporation
000 Xxxxxxxxx Xxxxxx Xxxxxxx Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
I-1
EXHIBIT J
SCHEDULE OF CORPORATE NAMES,
----------------------------
TRADE NAMES OR ASSUMED NAMES
----------------------------
GG Terminal Management Corporation
Georgia Gulf Export Corporation
Georgia Gulf Corporation
Georgia Gulf
J-1
EXHIBIT K
FORM OF COMPLIANCE CERTIFICATE
I, the undersigned Treasurer of GGRC Corp. ("GGRC") DO HEREBY CERTIFY
pursuant to Section 5.1(a)(iii) of the Receivables Transfer Agreement, dated as
of March 10, 1998 (as amended, supplemented or otherwise modified and in effect
from time to time, the "Transfer Agreement"), between GGRC Corp., Georgia Gulf
Corporation and Blue Ridge Asset Funding Corporation, that on and as of the date
hereof, there exists no Termination Event or Potential Termination Event.
Capitalized terms not otherwise defined herein have the meanings
assigned to them in the Transfer Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Certificate this
___day of _________, 199___.
GGRC CORP. , as
Transferor
By: --------------------
Name:
Title: [Treasurer]
K-1
