EXHIBIT 10.02
RECEIVABLES PURCHASE AGREEMENT
dated as of June 24, 2002
Among
COMDATA FUNDING CORPORATION, as Seller,
COMDATA NETWORK, INC., as Servicer,
JUPITER SECURITIZATION CORPORATION,
THE FINANCIAL INSTITUTIONS PARTY HERETO
and
BANK ONE, NA (MAIN OFFICE CHICAGO),
as Agent
TABLE OF CONTENTS
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ARTICLE I. PURCHASE ARRANGEMENTS..................................................................................1
Section 1.1 Purchase Facility......................................................................1
Section 1.2 Increases..............................................................................2
Section 1.3 Decreases..............................................................................2
Section 1.4 Payment Requirements...................................................................2
ARTICLE II. PAYMENTS AND COLLECTIONS..............................................................................3
Section 2.1 Payments...............................................................................3
Section 2.2 Collections Prior to Amortization......................................................3
Section 2.3 Collections Following Amortization.....................................................4
Section 2.4 Application of Collections.............................................................4
Section 2.5 Payment Rescission.....................................................................5
Section 2.6 Maximum Purchaser Interests............................................................5
Section 2.7 Repurchase Right.......................................................................5
ARTICLE III. COMPANY FUNDING......................................................................................5
Section 3.1 CP Costs...............................................................................5
Section 3.2 CP Costs Payments......................................................................5
Section 3.3 Calculation of CP Costs................................................................5
ARTICLE IV. FINANCIAL INSTITUTION FUNDING.........................................................................6
Section 4.1 Financial Institution Funding..........................................................6
Section 4.2 Yield Payments.........................................................................6
Section 4.3 Selection and Continuation of Tranche Periods..........................................6
Section 4.4 Financial Institution Discount Rates...................................................6
Section 4.5 Suspension of the LIBO Rate............................................................7
ARTICLE V. REPRESENTATIONS AND WARRANTIES.........................................................................7
Section 5.1 Representations and Warranties of the Seller Parties...................................7
Section 5.2 Financial Institution Representations and Warranties..................................11
ARTICLE VI. CONDITIONS OF PURCHASES..............................................................................12
Section 6.1 Conditions Precedent to Initial Incremental Purchase..................................12
Section 6.2 Conditions Precedent to All Purchases and Reinvestments...............................12
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ARTICLE VII. COVENANTS...........................................................................................13
Section 7.1 Affirmative Covenants of The Seller Parties...........................................13
Section 7.2 Negative Covenants of The Seller Parties..............................................21
ARTICLE VIII. ADMINISTRATION AND COLLECTION......................................................................22
Section 8.1 Designation of Servicer...............................................................22
Section 8.2 Duties of Servicer....................................................................23
Section 8.3 Collection Notices....................................................................24
Section 8.4 Responsibilities of Seller............................................................25
Section 8.5 Reports...............................................................................25
Section 8.6 Servicing Fees........................................................................25
ARTICLE IX. AMORTIZATION EVENTS..................................................................................25
Section 9.1 Amortization Events...................................................................25
Section 9.2 Remedies..............................................................................27
ARTICLE X. INDEMNIFICATION.......................................................................................27
Section 10.1 Indemnities by The Seller Parties............................................27
Section 10.2 Increased Cost and Reduced Return............................................30
Section 10.3 Other Costs and Expenses.....................................................30
ARTICLE XI. THE AGENT............................................................................................31
Section 11.1 Authorization and Action.....................................................31
Section 11.2 Delegation of Duties.........................................................31
Section 11.3 Exculpatory Provisions.......................................................31
Section 11.4 Reliance by Agent............................................................32
Section 11.5 Non-Reliance on Agent and Other Purchasers...................................32
Section 11.6 Reimbursement and Indemnification............................................32
Section 11.7 Agent in its Individual Capacity.............................................33
Section 11.8 Successor Agent..............................................................33
ARTICLE XII. ASSIGNMENTS; PARTICIPATIONS.........................................................................33
Section 12.1 Assignments..................................................................33
Section 12.2 Participations...............................................................34
ARTICLE XIII. LIQUIDITY FACILITY.................................................................................34
Section 13.1 Transfer to Financial Institutions...........................................34
Section 13.2 Transfer Price Reduction Yield...............................................35
Section 13.3 Payments to Company..........................................................35
Section 13.4 Limitation on Commitment to Purchase from Company............................35
Section 13.5 Defaulting Financial Institutions............................................35
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Section 13.6 Terminating Financial Institutions...........................................36
ARTICLE XIV. MISCELLANEOUS.......................................................................................37
Section 14.1 Waivers and Amendments.......................................................37
Section 14.2 Notices......................................................................38
Section 14.3 Ratable Payments.............................................................38
Section 14.4 Protection of Ownership Interests of the Purchasers..........................38
Section 14.5 Confidentiality..............................................................39
Section 14.6 Bankruptcy Petition..........................................................39
Section 14.7 Limitation of Liability......................................................40
Section 14.8 CHOICE OF LAW................................................................40
Section 14.9 CONSENT TO JURISDICTION......................................................40
Section 14.10 WAIVER OF JURY TRIAL.........................................................41
Section 14.11 Integration; Binding Effect; Survival of Terms...............................41
Section 14.12 Counterparts; Severability; Section References...............................41
Section 14.13 Bank One Roles...............................................................41
Section 14.14 Characterization.............................................................42
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RECEIVABLES PURCHASE AGREEMENT
This Receivables Purchase Agreement dated as of June 24, 2002
is among Comdata Funding Corporation, a Delaware corporation ("Seller"), Comdata
Network, Inc., a Maryland corporation ("Comdata"), as initial Servicer (the
Servicer together with Seller, the "Seller Parties" and each a "Seller Party"),
the entities listed on Schedule A to this Agreement (together with any of their
respective successors and assigns hereunder, the "Financial Institutions"),
Jupiter Securitization Corporation ("Company") and Bank One, NA (Main Office
Chicago), as agent for the Purchasers hereunder or any successor agent hereunder
(together with its successors and assigns hereunder, the "Agent"). Unless
defined elsewhere herein, capitalized terms used in this Agreement shall have
the meanings assigned to such terms in Exhibit I.
PRELIMINARY STATEMENTS
Seller desires to transfer and assign Purchaser Interests to
the Purchasers from time to time.
Company may, in its absolute and sole discretion, purchase
Purchaser Interests from Seller from time to time.
In the event that Company declines to make any purchase, the
Financial Institutions shall, at the request of Seller, purchase Purchaser
Interests from time to time. In addition, the Financial Institutions have agreed
to provide a liquidity facility to Company in accordance with the terms hereof.
Bank One, NA (Main Office Chicago) has been requested and is
willing to act as Agent on behalf of Company and the Financial Institutions in
accordance with the terms hereof.
ARTICLE I.
PURCHASE ARRANGEMENTS
Section 1.1 Purchase Facility.
(a) Upon the terms and subject to the conditions hereof,
during the period from the date hereof to but not including the Facility
Termination Date, Seller may, at its option up to four times per month, sell and
assign Purchaser Interests to the Agent for the benefit of one or more of the
Purchasers. In accordance with the terms and conditions set forth herein,
Company may, at its option, instruct the Agent to purchase on behalf of Company,
or if Company shall decline to purchase, the Agent shall purchase, on behalf of
the Financial Institutions, Purchaser Interests from time to time in an
aggregate amount not to exceed at such time the lesser of (i) the Purchase Limit
and (ii) the aggregate amount of the Commitments during the period from the date
hereof to but not including the Facility Termination Date.
(b) Seller may, upon at least 10 Business Days' notice to the
Agent, terminate in whole or reduce in part, ratably among the Financial
Institutions, the unused portion of the Purchase Limit; provided that each
partial reduction of the Purchase Limit shall be in an amount equal to
$5,000,000 or an integral multiple thereof.
Section 1.2 Increases.
Seller shall provide the Agent with at least two Business
Days' prior notice in a form set forth as Exhibit II hereto of each Incremental
Purchase (a "Purchase Notice"). Each Purchase Notice shall be subject to Section
6.2 hereof and, except as set forth below, shall be irrevocable and shall
specify the requested Purchase Price (which shall not be less than $1,000,000
and shall be in increments of $100,000) and date of purchase and, in the case of
an Incremental Purchase to be funded by the Financial Institutions, the
requested Discount Rate and Tranche Period. Following receipt of a Purchase
Notice, the Agent will determine whether Company agrees to make the purchase. If
Company declines to make a proposed purchase, the Agent will advise Seller of
such fact and Seller may cancel the Purchase Notice or, in the absence of such a
cancellation, the Incremental Purchase of the Purchaser Interest will be made by
the Financial Institutions. On the date of each Incremental Purchase, upon
satisfaction of the applicable conditions precedent set forth in Article VI,
Company or the Financial Institutions, as applicable, shall deposit to the
Facility Account, in immediately available funds, no later than 12:00 noon
(Chicago time), an amount equal to (i) in the case of Company, the aggregate
Purchase Price of the Purchaser Interests Company is then purchasing or (ii) in
the case of a Financial Institution, such Financial Institution's Pro Rata Share
of the aggregate Purchase Price of the Purchaser Interests the Financial
Institutions are purchasing.
Section 1.3 Decreases. Seller shall provide the Agent with
prior written notice in a form set forth as Exhibit XII hereto in conformity
with the Required Notice Period (a "Reduction Notice") of any proposed reduction
of Aggregate Capital from Collections. Such Reduction Notice shall designate (i)
the date (the "Proposed Reduction Date") upon which any such reduction of
Aggregate Capital shall occur (which date shall give effect to the applicable
Required Notice Period), and (ii) the amount of Aggregate Capital to be reduced
which shall be applied ratably to the Purchaser Interests of Company and the
Financial Institutions in accordance with the amount of Capital (if any) owing
to Company, on the one hand, and the amount of Capital (if any) owing to the
Financial Institutions (ratably, based on their respective Pro Rata Shares), on
the other hand (the "Aggregate Reduction"). Only one (1) Reduction Notice shall
be outstanding at any time.
Section 1.4 Payment Requirements. All amounts to be paid or
deposited by any Seller Party pursuant to any provision of this Agreement shall
be paid or deposited in accordance with the terms hereof no later than 11:00
a.m. (Chicago time) on the day when due in immediately available funds, and if
not received before 11:00 a.m. (Chicago time) shall be deemed to be received on
the next succeeding Business Day. If such amounts are payable to a Purchaser
they shall be paid to Company, for the account of such Purchaser, at 1 Bank Xxx
Xxxxx, Xxxxxxx, Xxxxxxxx 00000 until otherwise notified by the Agent. Upon
notice to Seller, the Agent may debit the Facility Account for all amounts due
and payable hereunder. All computations of Yield, per annum fees calculated as
part of any CP Costs, per annum fees hereunder and per annum fees under the Fee
Letter shall be made on the basis of a year of 360 days for the actual number of
days elapsed. If any amount hereunder shall be payable on a day which is not a
Business Day, such amount shall be payable on the next succeeding Business Day.
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ARTICLE II.
PAYMENTS AND COLLECTIONS
Section 2.1 Payments. Notwithstanding any limitation on
recourse contained in this Agreement, Seller shall pay to Company when due, for
the account of the relevant Purchaser or Purchasers on a full recourse basis,
(i) such fees as set forth in the Fee Letter (which fees shall be sufficient to
pay all fees owing to the Financial Institutions), (ii) all CP Costs, (iii) all
amounts payable as Yield, (iv) all amounts payable as Deemed Collections (which
shall be immediately due and payable by Seller and applied to reduce outstanding
Aggregate Capital hereunder in accordance with Sections 2.2 and 2.3 hereof), (v)
all amounts required pursuant to Section 2.6, (vi) all amounts payable pursuant
to Article X, if any, (vii) all Servicer costs and expenses, including the
Servicing Fee, in connection with servicing, administering and collecting the
Receivables, if Comdata or one of its Affiliates is not then acting as Servicer
(if Comdata or one of its Affiliates is then acting as Servicer, such amount
remains payable but shall be paid to the Servicer), (viii) all Broken Funding
Costs and (ix) all Default Fees (collectively, the "Obligations"). If any Person
fails to pay any of the Obligations when due, such Person agrees to pay, on
demand, the Default Fee in respect thereof until paid. Notwithstanding the
foregoing, no provision of this Agreement or the Fee Letter shall require the
payment or permit the collection of any amounts hereunder in excess of the
maximum permitted by applicable law. If at any xxxx Xxxxxx receives any
Collections or is deemed to receive any Collections, Seller shall immediately
pay such Collections or Deemed Collections to the Servicer for application in
accordance with the terms and conditions hereof and, at all times prior to such
payment, such Collections or Deemed Collections shall be held in trust by Seller
for the exclusive benefit of the Purchasers and the Agent.
Section 2.2 Collections Prior to Amortization. Prior to the
Amortization Date, any Collections and/or Deemed Collections received by the
Servicer shall be set aside and held in trust by the Servicer for the payment of
any accrued and unpaid Aggregate Unpaids or for a Reinvestment as provided in
this Section 2.2. If at any time any Collections are received by the Servicer
prior to the Amortization Date, (a) the Servicer shall set aside the Termination
Percentage (hereinafter defined) of Collections evidenced by the Purchaser
Interests of each Terminating Financial Institution and (b) Seller hereby
requests and the Purchasers (other than any Terminating Financial Institutions)
hereby agree to make, simultaneously with such receipt, a reinvestment (each a
"Reinvestment") with that portion of the balance of each and every Collection
received by the Servicer that is part of any Purchaser Interest (other than any
Purchaser Interests of Terminating Financial Institutions), such that after
giving effect to such Reinvestment, the amount of Capital of such Purchaser
Interest immediately after such receipt and corresponding Reinvestment shall be
equal to the amount of Capital immediately prior to such receipt. On each
Settlement Date prior to the occurrence of the Amortization Date, the Servicer
shall remit to the Company's account the amounts set aside during the preceding
Settlement Period that have not been subject to a Reinvestment and apply such
amounts (if not previously paid in accordance with Section 2.1) first, to reduce
unpaid Obligations and second, to reduce the Capital of all Purchaser Interests
of Terminating Financial Institutions, applied ratably to each Terminating
Financial Institution according to its respective Termination Percentage. If
such Capital and Obligations shall be reduced to zero, any additional
Collections received by the Servicer (i) if applicable, shall be remitted to the
Company's account no later than 11:00 a.m. (Chicago time) to the extent required
to fund any Aggregate Reduction on such
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Settlement Date and (ii) any balance remaining thereafter shall be remitted from
the Servicer to Seller on such Settlement Date. Each Terminating Financial
Institution shall be allocated a ratable portion of Collections from the date of
any assignment by Company pursuant to Section 13.6 (the "Termination Date")
until such Terminating Financing Institution's Capital shall be paid in full.
This ratable portion shall be calculated on the Termination Date of each
Terminating Financial Institution as a percentage equal to (A) Capital of such
Terminating Financial Institution outstanding on its Termination Date, divided
by (B) the Aggregate Capital outstanding on such Termination Date (the
"Termination Percentage"). Each Terminating Financial Institution's Termination
Percentage shall remain constant prior to the Amortization Date. On and after
the Amortization Date, each Termination Percentage shall be disregarded, and
each Terminating Financial Institution's Capital shall be reduced ratably with
all Financial Institutions in accordance with Section 2.3.
Section 2.3 Collections Following Amortization. On the
Amortization Date and on each day thereafter, the Servicer shall set aside and
hold in trust, for the holder of each Purchaser Interest, all Collections
received on such day and an additional amount for the payment of any accrued and
unpaid Obligations owed by Seller and not previously paid by Seller in
accordance with Section 2.1. On and after the Amortization Date, the Servicer
shall, at any time upon the request from time to time by (or pursuant to
standing instructions from) the Agent remit to the Company's account the amounts
set aside pursuant to the preceding sentence, and apply such amounts to reduce
the Capital associated with each such Purchaser Interest and any other Aggregate
Unpaids.
Section 2.4 Application of Collections. If there shall be
insufficient funds on deposit for the Servicer to distribute funds in payment in
full of the aforementioned amounts pursuant to Section 2.2 or 2.3 (as
applicable), the Servicer shall distribute funds:
first, to the reimbursement of the Agent's costs of
collection and enforcement of this Agreement,
second, ratably to the payment of all accrued and
unpaid fees under the Fee Letter, CP Costs and Yield,
third, (to the extent applicable) to the ratable
reduction of the Aggregate Capital (without regard to any Termination
Percentage),
fourth, for the ratable payment of all other unpaid
Obligations excluding Servicer costs and expenses and the Servicing
Fee, fifth, to the payment of the Servicer's reasonable out-of-pocket
costs and expenses in connection with servicing, administering and
collecting the Receivables, including the Servicing Fee, and
sixth, after the Aggregate Unpaids have been
indefeasibly reduced to zero, to Seller.
Collections applied to the payment of Aggregate Unpaids shall
be distributed in accordance with the aforementioned provisions, and, giving
effect to each of the priorities set
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forth in Section 2.4 above, shall be shared ratably (within each priority) among
the Agent and the Purchasers in accordance with the amount of such Aggregate
Unpaids owing to each of them in respect of each such priority.
Section 2.5 Payment Rescission. No payment of any of the
Aggregate Unpaids shall be considered paid or applied hereunder to the extent
that, at any time, all or any portion of such payment or application is
rescinded by application of law or judicial authority, or must otherwise be
returned or refunded for any reason. Seller shall remain obligated for the
amount of any payment or application so rescinded, returned or refunded, and
shall promptly pay to the Agent (for application to the Person or Persons who
suffered such rescission, return or refund) the full amount thereof, plus the
Default Fee from the date of any such rescission, return or refunding.
Section 2.6 Maximum Purchaser Interests. Seller shall ensure
that the Purchaser Interests of the Purchasers shall at no time exceed in the
aggregate 100%. If the aggregate of the Purchaser Interests of the Purchasers
exceeds 100%, Seller shall pay to the Agent within two (2) Business Days of
actual knowledge thereof an amount to be applied to reduce the Aggregate Capital
(as allocated by the Agent), such that after giving effect to such payment the
aggregate of the Purchaser Interests equals or is less than 100%.
Section 2.7 Repurchase Right. In addition to Seller's rights
pursuant to Section 1.3, Seller shall have the right (after providing written
notice to the Agent in accordance with the Required Notice Period), at any time
following the reduction of the Aggregate Capital to a level that is less than
100% of the original Purchase Limit, to repurchase from the Purchasers all, but
not less than all, of the then outstanding Purchaser Interests. The purchase
price in respect thereof shall be an amount equal to the Aggregate Unpaids
through the date of such repurchase, payable in immediately available funds.
Such repurchase shall be without representation, warranty or recourse of any
kind by, on the part of, or against any Purchaser or the Agent.
ARTICLE III.
COMPANY FUNDING
Section 3.1 CP Costs. Seller shall pay CP Costs with respect
to the Capital associated with each Purchaser Interest of Company for each day
that any Capital in respect of such Purchaser Interest is outstanding. Each
Purchaser Interest funded substantially with Pooled Commercial Paper will accrue
CP Costs each day on a pro rata basis, based upon the percentage share the
Capital in respect of such Purchaser Interest represents in relation to all
assets held by Company and funded substantially with Pooled Commercial Paper.
Section 3.2 CP Costs Payments. On each Settlement Date, Seller
shall pay to the Agent (for the benefit of Company) an aggregate amount equal to
all accrued and unpaid CP Costs in respect of the Capital associated with all
Purchaser Interests of Company for the immediately preceding Accrual Period in
accordance with Article II.
Section 3.3 Calculation of CP Costs. On the fifth Business Day
immediately preceding each Settlement Date, Company shall calculate the
aggregate amount of CP Costs for the applicable Accrual Period and shall notify
Seller of such aggregate amount.
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ARTICLE IV.
FINANCIAL INSTITUTION FUNDING
Section 4.1 Financial Institution Funding. Each Purchaser
Interest of the Financial Institutions shall accrue Yield for each day during
its Tranche Period at either the LIBO Rate or the Prime Rate in accordance with
the terms and conditions hereof. Until Seller gives notice to the Agent of
another Discount Rate in accordance with Section 4.4, the initial Discount Rate
for any Purchaser Interest transferred to the Financial Institutions pursuant to
the terms and conditions hereof shall be the Prime Rate. If the Financial
Institutions acquire by assignment from Company any Purchaser Interest pursuant
to Article XIII, each Purchaser Interest so assigned shall each be deemed to
have a new Tranche Period commencing on the date of any such assignment.
Section 4.2 Yield Payments. On the Settlement Date for each
Purchaser Interest of the Financial Institutions, Seller shall pay to the Agent
(for the benefit of the Financial Institutions) an aggregate amount equal to the
accrued and unpaid Yield for the entire Tranche Period of each such Purchaser
Interest in accordance with Article II.
Section 4.3 Selection and Continuation of Tranche Periods.
(a) With consultation from (and approval by) the
Agent, Seller shall from time to time request Tranche Periods for the Purchaser
Interests of the Financial Institutions, provided that, if at any time the
Financial Institutions shall have a Purchaser Interest, Seller shall always
request Tranche Periods such that at least one Tranche Period shall end on the
date specified in clause (A) of the definition of Settlement Date.
(b) Seller or the Agent, upon notice to and consent
by the other received at least three (3) Business Days prior to the end of a
Tranche Period (the "Terminating Tranche") for any Purchaser Interest, may,
effective on the last day of the Terminating Tranche: (i) divide any such
Purchaser Interest into multiple Purchaser Interests, (ii) combine any such
Purchaser Interest with one or more other Purchaser Interests that have a
Terminating Tranche ending on the same day as such Terminating Tranche or (iii)
combine any such Purchaser Interest with a new Purchaser Interests to be
purchased on the day such Terminating Tranche ends, provided, that in no event
may a Purchaser Interest of Company be combined with a Purchaser Interest of the
Financial Institutions.
Section 4.4 Financial Institution Discount Rates. Seller may
select the LIBO Rate or the Prime Rate for each Purchaser Interest of the
Financial Institutions. Seller shall by 11:00 a.m. (Chicago time): (i) at least
three (3) Business Days prior to the expiration of any Terminating Tranche with
respect to which the LIBO Rate is being requested as a new Discount Rate and
(ii) at least one (1) Business Day prior to the expiration of any Terminating
Tranche with respect to which the Prime Rate is being requested as a new
Discount Rate, give the Agent irrevocable notice of the new Discount Rate for
the Purchaser Interest associated with such Terminating Tranche. Until Seller
gives notice to the Agent of another Discount Rate, the initial Discount Rate
for any Purchaser Interest transferred to the Financial Institutions pursuant to
the terms and conditions hereof shall be the Prime Rate.
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Section 4.5 Suspension of the LIBO Rate.
(a) If any Financial Institution notifies the Agent
that it has determined that funding its Pro Rata Share of the Purchaser
Interests of the Financial Institutions at a LIBO Rate would violate any
applicable law, rule, regulation, or directive of any governmental or regulatory
authority, whether or not having the force of law, or that (i) deposits of a
type and maturity appropriate to match fund its Purchaser Interests at such LIBO
Rate are not available or (ii) such LIBO Rate does not accurately reflect the
cost of acquiring or maintaining a Purchaser Interest at such LIBO Rate, then
the Agent shall suspend the availability of such LIBO Rate and require Seller to
select the Prime Rate for any Purchaser Interest accruing Yield at such LIBO
Rate.
(b) If less than all of the Financial Institutions
give a notice to the Agent pursuant to Section 4.5(a), each Financial
Institution which gave such a notice shall be obliged, at the request of Seller,
Company or the Agent, to assign all of its rights and obligations hereunder to
(i) another Financial Institution or (ii) another funding entity nominated by
Seller or the Agent that is acceptable to Company and willing to participate in
this Agreement through the Liquidity Termination Date in the place of such
notifying Financial Institution; provided that (i) the notifying Financial
Institution receives payment in full, pursuant to an Assignment Agreement, of an
amount equal to such notifying Financial Institution's Pro Rata Share of the
Capital and Yield owing to all of the Financial Institutions and all accrued but
unpaid fees and other costs and expenses payable in respect of its Pro Rata
Share of the Purchaser Interests of the Financial Institutions, and (ii) the
replacement Financial Institution otherwise satisfies the requirements of
Section 12.1(b).
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of the Seller
Parties. Each Seller Party hereby represents and warrants to the Agent and the
Purchasers, as to itself, as of the date hereof and as of the date of each
Incremental Purchase and the date of each Reinvestment that:
(a) Corporate Existence and Power. Such Seller Party
(i) is a corporation duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation; (ii) has the power and authority
and all material governmental licenses, authorizations, consents and approvals
to own its assets and carry on its business, to execute, deliver, and perform
its obligations under this Agreement and each other Transaction Document to
which it is a party and to use the proceeds of the purchases made hereunder;
(iii) is duly qualified as a foreign corporation, licensed and in good standing
under the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification or license,
except where the failure to be so qualified, licensed or in good standing would
not adversely affect the business or operations of such Seller Party in any
significant manner; and (iv) is in compliance with all material Laws applicable
to it.
(b) Corporate Authorization; No Contravention. The
execution, delivery and performance by each Seller Party of this Agreement and
each other Transaction Document to which it is a party, and the consummation of
the transactions herein and therein contemplated, have been duly authorized by
all necessary corporate action by or on behalf of such Seller Party,
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and do not and will not (i) contravene the terms of such Seller Party's
certificate or articles of incorporation and the bylaws or any shareholder
agreements, voting trusts, and similar arrangements applicable to any of its
authorized shares; (ii) conflict with or result in any breach or contravention
of any document evidencing any Contractual Obligation to which such Seller Party
is a party or any of its property is bound or any order, injunction, writ or
decree of any Governmental Authority to which such Seller Party or its property
is subject; (iii) result in the creation of any Lien under (except as created
hereunder), any document evidencing any Contractual Obligation to which such
Seller Party or its Subsidiaries is a party or any of its property is bound or
any order, injunction, writ or decree of any Governmental Authority to which
such Seller Party or its property is subject; or (iv) violate any Law applicable
to such Seller Party or require compliance with any bulk sales act or similar
law.
(c) Binding Effect. This Agreement and each other
Transaction Document to which such Seller Party is a party has been duly
executed and delivered and constitutes the legal, valid and binding obligations
of such Seller Party, enforceable against such Seller Party in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, or similar laws affecting the enforcement of creditors' rights
generally or by equitable principles relating to enforceability.
(d) Governmental Authorization. Other than the filing
of the financing statements required hereunder, no approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, such Seller Party
of this Agreement or any other Transaction Document to which such Seller Party
is a party.
(e) Actions, Suits. There are no actions, suits,
proceedings, claims or disputes pending, or to the best knowledge of such Seller
Party, threatened or contemplated, at law, in equity, in arbitration or before
any Governmental Authority, against such Seller Party or any of its properties
which would reasonably be expected to have a Material Adverse Effect (and
assuming for this purpose a reasonable likelihood of an adverse decision). Such
Seller Party is not in default with respect to any order of any court,
arbitrator or governmental body.
(f) Accuracy of Information. All information
heretofore furnished by such Seller Party or any of its Affiliates to the Agent
or the Purchasers for purposes of or in connection with this Agreement, any of
the other Transaction Documents or any transaction contemplated hereby or
thereby is, and all such information hereafter furnished by such Seller Party or
any of its Affiliates to the Agent or the Purchasers will be, true and accurate
in every material respect on the date such information is stated or certified
and does not and will not contain any material misstatement of fact or omit to
state a material fact or any fact necessary to make the statements contained
therein not misleading.
(g) Use of Proceeds. No proceeds of any purchase
hereunder will be used (i) for a purpose that violates, or would be inconsistent
with, Regulation T, U or X promulgated by the Board of Governors of the Federal
Reserve System from time to time or (ii) to acquire any security in any
transaction which is subject to Section 12, 13 or 14 of the Securities Exchange
Act of 1934, as amended.
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(h) Good Title. Immediately prior to each purchase
hereunder, Seller (i) shall be the legal and beneficial owner of the Receivables
and (ii) shall be the legal or beneficial owner of the Related Security with
respect thereto (to the extent such Related Security is covered by Article 9 of
the UCC), in each case free and clear of any Adverse Claim, except as created by
the Transaction Documents. There have been duly filed all financing statements
or other similar instruments or documents necessary under the UCC (or any
comparable law) of all appropriate jurisdictions to perfect Seller's ownership
interest in each Receivable, its Collections and the Related Security (to the
extent such Related Security is covered by Article 9 of the UCC).
(i) Perfection. This Agreement, together with the
filing of the financing statements contemplated hereby, is effective to, and
shall, upon each purchase hereunder, transfer to the Agent for the benefit of
the relevant Purchaser or Purchasers (and the Agent for the benefit of such
Purchaser or Purchasers shall acquire from Seller) a valid and perfected first
priority undivided percentage ownership or security interest in each Receivable
existing or hereafter arising and in the Related Security (to the extent such
Related Security is covered by Article 9 of the UCC) and Collections with
respect thereto, free and clear of any Adverse Claim, except as created by the
Transactions Documents. There have been duly filed all financing statements or
other similar instruments or documents necessary under the UCC (or any
comparable law) of all appropriate jurisdictions to perfect the Agent's (on
behalf of the Purchasers) ownership or security interest in the Receivables, the
Related Security (to the extent such Related Security is covered by Article 9 of
the UCC) and the Collections.
(j) Places of Business, Jurisdiction of Organization
and Locations of Records. The principal places of business, jurisdiction of
organization and chief executive office of such Seller Party and the offices
where it keeps all of its Records are located at the address(es) listed on
Exhibit III or such other locations of which the Agent has been notified in
accordance with Section 7.2(a) in jurisdictions where all action required by
Section 14.4(a) has been taken and completed. Seller's organizational number
assigned to it by its jurisdiction of organization and Seller's Federal Employer
Identification Number are correctly set forth on Exhibit III. Seller has not,
within a period of one year prior to the date hereof, (i) changed the location
of its principal place of business or chief executive office or its corporate
structure, (ii) changed its legal name, (iii) become a "new debtor" (as defined
in Section 9-102(a)(56) of the UCC in effect in the state of Delaware or (iv)
changed its jurisdiction of organization. Seller is a Delaware corporation and
is a "registered organization" (within the meaning of Section 9-102 of the UCC
in effect in the State of Delaware).
(k) Collections. The conditions and requirements set
forth in Section 7.1(j) and Section 8.2 have at all times been satisfied and
duly performed. The names and addresses of all Collection Banks, together with
the account numbers of the Collection Accounts of Seller at each Collection Bank
and the post office box number of each Lock-Box, are listed on Exhibit IV.
Seller has not granted any Person, other than the Agent as contemplated by this
Agreement, dominion and control or "control" (within the meaning of Section
9-104 of the UCC of all applicable jurisdictions) of any Lock-Box or Collection
Account, or the right to take dominion and control or "control" (within the
meaning of Section 9-104 of the UCC of all applicable jurisdictions) of any such
Lock-Box or Collection Account at a future time or upon the occurrence of a
future event. Seller has taken all steps necessary to ensure that the Agent has
"control" (within the meaning of Section 9-104 of the UCC of all applicable
jurisdictions) over
Page 9
all Collection Accounts and Lock-Boxes. Such Seller Party has the ability to
identify, within two (2) Business Days of deposit, all amounts that are
deposited to the ACH Account as constituting Collections or non-Collections.
(l) Material Adverse Effect. (i) The initial Servicer
represents and warrants that since December 31, 2001, no event has occurred that
would have a material adverse effect on the financial condition or operations of
the initial Servicer and its Subsidiaries or the Performance Guarantor or the
ability of the initial Servicer to perform its obligations under this Agreement,
and (ii) Seller represents and warrants that since the date of this Agreement,
no event has occurred that would have a material adverse effect on (A) the
financial condition or operations of Seller, (B) the ability of Seller to
perform its obligations under the Transaction Documents, or (C) the
collectibility of the Receivables generally or any material portion of the
Receivables.
(m) Names. In the past five (5) years, Seller has not
used any corporate names, trade names or assumed names other than the name in
which it has executed this Agreement and other than the trade names listed on
Exhibit III hereto.
(n) Ownership of Seller. Originator owns, directly or
indirectly, 100% of the issued and outstanding capital stock of Seller, free and
clear of any Adverse Claim. Such capital stock is validly issued, fully paid and
nonassessable, and there are no options, warrants or other rights to acquire
securities of Seller.
(o) Not a Holding Company or an Investment Company.
Such Seller Party is not a "holding company" or a "subsidiary holding company"
of a "holding company" within the meaning of the Public Utility Holding Company
Act of 1935, as amended, or any successor statute. Such Seller Party is not, and
after giving effect to the transactions contemplated hereby, will not be
required to be registered as, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or any successor statute.
(p) Compliance with Law. Such Seller Party has
complied in all respects with all applicable laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards to which it may be subject,
except where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect (such determination to be made solely by Agent). Each
Receivable, together with the Contract related thereto, does not contravene any
laws, rules or regulations applicable thereto (including, without limitation,
laws, rules and regulations relating to truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt collection practices
and privacy), and no part of such Contract is in violation of any such law, rule
or regulation, except, in each of the foregoing cases, where such contravention
or violation could not reasonably be expected to have a Material Adverse Effect
(such determination to be made solely by Agent).
(q) Compliance with Credit and Collection Policy.
Such Seller Party has complied in all material respects with the Credit and
Collection Policy with regard to each Receivable and the related Contract, and
has not made any material change to such Credit and Collection Policy, except
such material change as to which the Agent has been notified in accordance with
Section 7.1(a)(vii).
Page 10
(r) Payments to Originator. The Seller represents and
warrants with respect to each Receivable transferred to Seller under the
Receivables Sale Agreement, Seller has given reasonably equivalent value to
Originator in consideration therefor and such transfer was not made for or on
account of an antecedent debt. No transfer by Originator of any Receivable under
the Receivables Sale Agreement is or may be voidable under any Section of the
Bankruptcy Reform Act of 1978 (11 U.S.C. Sections 101 et seq.), as amended.
(s) Enforceability of Contracts. The Seller
represents and warrants each Contract with respect to each Receivable is
effective to create, and has created, a legal, valid and binding obligation of
the related Obligor to pay the Outstanding Balance of the Receivable created
thereunder (as such Outstanding Balance may be adjusted pursuant to the terms of
the Contract) and any accrued interest thereon, enforceable against the Obligor
in accordance with its terms, except as such enforcement may be limited by
applicable bankruptcy, insolvency, reorganization or other similar laws relating
to or limiting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity or at
law).
(t) Eligible Receivables. The Seller represents and
warrants each Receivable included in the Net Receivables Balance as an Eligible
Receivable on the date of its purchase under the Receivables Sale Agreement was
an Eligible Receivable on such purchase date.
(u) Net Receivables Balance. Seller has determined
that, immediately after giving effect to each purchase hereunder, the Net
Receivables Balance is at least equal to the sum of (i) the Aggregate Capital,
plus (ii) the Aggregate Reserves.
(v) Accounting. The fact that such Seller Party does
not account for the transactions contemplated by this Agreement as sales for
financial or tax accounting purposes does not jeopardize the legal
characterization of the transactions contemplated herein as being true sales.
(w) Identification of Receivables. Each Seller Party
identifies receivables belonging to the "Company 1" accounting classification in
the GEAC Accounting System with an account code beginning with "01000000000"
followed by a two-alpha, three numeric identification system.
(x) Master Data Processing Records. Such Seller Party
does not maintain any master data processing records or other database that
includes or refers to the Receivables other than those relating to the aging of
the Receivables.
(y) Receivables Not Evidenced by Negotiable
Instruments. At the time each Receivable is created, such Receivable is not
evidenced by a negotiable instrument.
Section 5.2 Financial Institution Representations and
Warranties. Each Financial Institution hereby represents and warrants to the
Agent and Company that:
(a) Existence and Power. Such Financial Institution
is a corporation or a banking association duly organized, validly existing and
in good standing under the laws of its
Page 11
jurisdiction of incorporation or organization, and has all corporate power to
perform its obligations hereunder.
(b) No Conflict. The execution and delivery by such Financial
Institution of this Agreement and the performance of its obligations hereunder
are within its corporate powers, have been duly authorized by all necessary
corporate action, do not contravene or violate (i) its certificate or articles
of incorporation or association or by-laws, (ii) any law, rule or regulation
applicable to it, (iii) any restrictions under any agreement, contract or
instrument to which it is a party or by which any of its property is bound, or
(iv) any order, writ, judgment, award, injunction or decree binding on or
affecting it or its property, and do not result in the creation or imposition of
any Adverse Claim on its assets. This Agreement has been duly authorized,
executed and delivered by such Financial Institution.
(c) Governmental Authorization. No authorization or approval
or other action by, and no notice to or filing with, any governmental authority
or regulatory body is required for the due execution and delivery by such
Financial Institution of this Agreement and the performance of its obligations
hereunder.
(d) Binding Effect. This Agreement constitutes the legal,
valid and binding obligation of such Financial Institution enforceable against
such Financial Institution in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization
or other similar laws relating to or limiting creditors' rights generally and by
general principles of equity (regardless of whether such enforcement is sought
in a proceeding in equity or at law).
ARTICLE VI.
CONDITIONS OF PURCHASES
Section 6.1 Conditions Precedent to Initial Incremental Purchase. The
initial Incremental Purchase of a Purchaser Interest under this Agreement is
subject to the conditions precedent that (a) the Agent shall have received on or
before the date of such purchase those documents listed on Schedule B, (b) the
Agent shall have received all fees and expenses required to be paid on such date
pursuant to the terms of this Agreement and the Fee Letter and (c) the Agent
shall have completed its audit and due diligence review and shall have obtained
credit approval for the transactions contemplated by this Agreement.
Section 6.2 Conditions Precedent to All Purchases and Reinvestments.
Each purchase of a Purchaser Interest (other than pursuant to Section 13.1) and
each Reinvestment shall be subject to the further conditions precedent that (a)
in the case of each such purchase or Reinvestment: (i) the Servicer shall have
delivered to the Agent on or prior to the date of such purchase, in form and
substance satisfactory to the Agent, all Settlement Reports as and when due
under Section 8.5 and (ii) upon the Agent's request, the Servicer shall have
delivered to the Agent at least three (3) days prior to such purchase or
Reinvestment an interim Settlement Report showing the amount of Eligible
Receivables; (b) the Facility Termination Date shall not have occurred; (c) the
Agent shall have received such other approvals, opinions or documents as it may
reasonably request and (d) on the date of each such Incremental Purchase or
Reinvestment, the following statements shall be true (and acceptance of the
proceeds of such
Page 12
Incremental Purchase or Reinvestment shall be deemed a representation and
warranty by Seller that such statements are then true):
(i) the representations and warranties set forth in
Section 5.1 are true and correct on and as of the date of such
Incremental Purchase or Reinvestment as though made on and as of such
date;
(ii) no event has occurred and is continuing, or
would result from such Incremental Purchase or Reinvestment, that will
constitute an Amortization Event, and no event has occurred and is
continuing, or would result from such Incremental Purchase or
Reinvestment, that would constitute a Potential Amortization Event,
provided, however, that upon notice to the Agent of such Potential
Amortization Event (A) Reinvestments shall be permitted during the five
(5) consecutive Business Day period during which Seller Party can cure
an event described in Section 9.1(a)(ii) hereof and (B) Reinvestments
shall be permitted during the thirty (30) consecutive day period during
which Servicer can cure an event described in Section 9.1(h)(ii)
hereof, provided that Servicer has adequate cash reserves available and
allocated to cover such money judgment; and
(iii) the Aggregate Capital does not exceed the
Purchase Limit and the aggregate Purchaser Interests do not exceed
100%.
It is expressly understood that each Reinvestment shall, unless otherwise
directed by the Agent or any Purchaser, occur automatically on each day that the
Servicer shall receive any Collections without the requirement that any further
action be taken on the part of any Person and notwithstanding the failure of
Seller to satisfy any of the foregoing conditions precedent in respect of such
Reinvestment. The failure of Seller to satisfy any of the foregoing conditions
precedent in respect of any Reinvestment shall give rise to a right of the
Agent, which right may be exercised at any time on demand of the Agent, to
rescind the related purchase and direct Seller to pay to the Agent for the
benefit of the Purchasers an amount equal to the Collections prior to the
Amortization Date that shall have been applied to the affected Reinvestment.
ARTICLE VII.
COVENANTS
Section 7.1 Affirmative Covenants of The Seller Parties. Until the date
on which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself, as set forth below:
(a) Financial Reporting. Such Seller Party will maintain, for
itself and each of its Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish or cause to be furnished to
the Agent:
(i) Annual Reporting. Within 90 days after the close
of each of its respective fiscal years, audited, unqualified financial
statements (which shall include balance sheets, statements of income
and retained earnings and a statement of cash flows) for Ceridian for
such fiscal year certified in a manner reasonably acceptable to the
Agent by nationally recognized independent public accountants
reasonably
Page 13
acceptable to the Agent (such acceptance not to be unreasonably
withheld) and within 90 days after the close of its fiscal year,
unaudited financial statements (which shall include balance sheet,
statement of income and retained earnings and statement of cash flows)
for the Seller for such fiscal year.
(ii) Quarterly Reporting. Within 45 days after the
close of the first three (3) quarterly periods of each of its
respective fiscal years, balance sheets of each of Seller and Ceridian
as at the close of each such period and statements of income and
retained earnings and a statement of cash flows for each such Person
for the period from the beginning of such fiscal year to the end of
such quarter, all certified by its respective chief financial officer,
corporate controller or treasurer.
(iii) Compliance Certificate. Together with the
financial statements required hereunder, if any, a compliance
certificate in substantially the form of Exhibit V signed by such
Seller Party's or Ceridian's Authorized Officer, as applicable, and
dated the last date of such year or quarter, as the case may be.
(iv) Shareholders Statements and Reports. Promptly
upon the furnishing thereof to the shareholders of such Seller Party or
Ceridian copies of all financial statements, reports and proxy
statements so furnished.
(v) S.E.C. Filings. Promptly upon the filing thereof,
copies of all registration statements and annual, quarterly, monthly or
other regular reports which Originator, any of its Subsidiaries or
Ceridian files with the Securities and Exchange Commission.
(vi) Copies of Notices. Promptly upon its receipt of
any notice, request for consent, financial statements, certification,
report or other communication under or in connection with any
Transaction Document from any Person other than the Agent or Company,
copies of the same.
(vii) Change in Credit and Collection Policy. At
least thirty (30) days prior to the effectiveness of any material
change in or material amendment to the Credit and Collection Policy, a
copy of the Credit and Collection Policy then in effect and a notice
(A) indicating such change or amendment, and (B) if such proposed
change or amendment would be reasonably likely to adversely affect the
collectibility of the Receivables or decrease the credit quality of any
newly created Receivables, requesting the Agent's consent thereto.
(viii) Other Information. Promptly, from time to
time, such other information, documents, records or reports relating to
the Receivables or the condition or operations, financial or otherwise,
of such Seller Party or Ceridian as the Agent may from time to time
reasonably request in order to protect the interests of the Agent and
the Purchasers under or as contemplated by this Agreement.
(b) Notices. Such Seller Party will notify the Agent in
writing of any of the following promptly upon learning of the occurrence
thereof, describing the same and, if applicable, the steps being taken with
respect thereto:
Page 14
(i) Amortization Events or Potential Amortization
Events. The occurrence of each Amortization Event and each Potential
Amortization Event, by a statement of an Authorized Officer of such
Seller Party.
(ii) Judgment and Proceedings. (A) (1) The entry of
any judgment or decree against the Servicer or any of its respective
Subsidiaries if the aggregate amount of all judgments and decrees then
outstanding against the Servicer and its Subsidiaries exceeds
$10,000,000 and (2) the institution of any litigation, arbitration
proceeding or governmental proceeding against the Servicer which,
individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect; and (B) the entry of any judgment or decree
or the institution of any litigation, arbitration proceeding or
governmental proceeding against Seller that could reasonably be
expected to have a Material Adverse Effect.
(iii) Material Adverse Effect. The occurrence of any
event or condition that has had, or could reasonably be expected to
have, a Material Adverse Effect.
(iv) Termination Date. The occurrence of the
"Termination Date" under and as defined in the Receivables Sale
Agreement.
(v) Defaults Under Other Agreements. The occurrence
of a default or an event of default under any other financing
arrangement pursuant to which such Seller Party or Performance
Guarantor is a debtor or an obligor.
(c) Compliance with Laws and Preservation of Corporate
Existence. Such Seller Party will comply in all respects with all applicable
laws, rules, regulations, orders, writs, judgments, injunctions, decrees or
awards to which it may be subject, except where the failure to so comply could
not reasonably be expected to have a Material Adverse Effect (such determination
to be made solely by the Agent). Such Seller Party will preserve and maintain
its corporate existence, rights, franchises and privileges in the jurisdiction
of its incorporation, and qualify and remain qualified in good standing as a
foreign corporation in each jurisdiction where its business is conducted, except
where the failure to so qualify or remain in good standing could not reasonably
be expected to have a Material Adverse Effect (such determination to be made
solely by the Agent).
(d) Audits. Such Seller Party will furnish to the Agent from
time to time such information with respect to it and the Receivables as the
Agent may reasonably request. Such Seller Party will, from time to time during
regular business hours as requested by the Agent upon reasonable notice and at
the sole cost of such Seller Party, permit the Agent, or its agents or
representatives, (i) to examine and make copies of and abstracts from all
Records in the possession or under the control of such Person relating to the
Receivables and the Related Security and Shared Security, including, without
limitation, the related Contracts and (ii) to visit the offices and properties
of such Person for the purpose of examining such materials described in clause
(i) above, and to discuss matters relating to such Person's financial condition
or the Receivables and the Related Security and Shared Security or any Person's
performance under any of the Transaction Documents or any Person's performance
under the Contracts and, in each
Page 15
case, with any of the officers or employees of Seller or the Servicer having
knowledge of such matters. Such Seller Party will, (A) annually and prior to any
Financial Institution renewing its Commitment hereunder, during regular business
hours as requested by the Agent upon reasonable notice and at the sole cost of
such Seller Party, permit the Agent, or its agents or representatives, to
conduct a follow-up audit; (B) from and after the occurrence of any Amortization
Event, at any time during regular business hours as requested by the Agent and
at the sole cost of such Seller Party, permit the Agent, or its agents or
representatives, to conduct a follow-up audit; and (C) at any time during
regular business hours as requested by the Agent upon reasonable notice and at
the sole cost of the Agent, permit the Agent, or its agents or representatives,
to conduct a follow-up audit, provided that the audits conducted pursuant to
this clause (C) shall not exceed two per fiscal year unless the results from any
such follow-up audit are unsatisfactory in the sole discretion of the Agent.
(e) Keeping and Marking of Records and Books.
(i) The Servicer will maintain and implement
administrative and operating procedures (including, without limitation,
an ability to recreate records evidencing Receivables in the event of
the destruction of the originals thereof), and keep and maintain all
documents, books, records and other information reasonably necessary or
advisable for the collection of all Receivables (including, without
limitation, records adequate to permit the immediate identification of
each new Receivable and all Collections of and adjustments to each
existing Receivable). The Servicer will give the Agent notice of any
material change in the administrative and operating procedures referred
to in the previous sentence.
(ii) Such Seller Party will (A) on or prior to the
date hereof, xxxx its master data processing records relating to the
aging of the Receivables with a legend, acceptable to the Agent,
describing the Purchaser Interests and (B) upon the request of the
Agent from and after the occurrence of any Amortization Event (x) xxxx
each Contract and other books and records relating to the Purchaser
Interests with a legend describing the Purchaser Interests and (y)
deliver to the Agent all Contracts (including, without limitation, all
multiple originals of any such Contract) and other books and records
relating to the Receivables (it being understood and agreed that such
Seller Party may retain copies of all such Contracts, and upon the
request of such Seller Party, the Agent will return (1) the original
copy of any such Contract to the extent such Contract is not needed to
enforce the Agent's or the Purchasers' rights thereunder and solely for
the limited purpose of enabling such Seller Party to enforce its rights
thereunder and (2) the original copy of any such Contract following the
indefeasible payment in full of the Aggregate Unpaids).
(f) Compliance with Contracts and Credit and Collection
Policy. Such Seller Party will timely and fully (i) perform and comply with all
material provisions, covenants and other promises required to be observed by it
under the Contracts related to the Receivables, and (ii) comply in all material
respects with the Credit and Collection Policy in regard to each Receivable and
the related Contract.
Page 16
(g) Performance and Enforcement of Receivables Sale Agreement.
Seller will, and will require Originator to, perform each of their respective
obligations and undertakings under and pursuant to the Receivables Sale
Agreement, will purchase Receivables thereunder in strict compliance with the
terms thereof and will vigorously enforce the rights and remedies accorded to
Seller under the Receivables Sale Agreement. Seller will take all actions to
perfect and enforce its rights and interests (and the rights and interests of
the Agent and the Purchasers as assignees of Seller) under the Receivables Sale
Agreement as the Agent may from time to time reasonably request, including,
without limitation, making claims to which it may be entitled under any
indemnity, reimbursement or similar provision contained in the Receivables Sale
Agreement.
(h) Ownership. Seller will (or will cause Originator to) take
all necessary action to (i) vest legal and equitable title to the Receivables,
the Related Security (to the extent such Related Security is covered by Article
9 of the UCC) and the Collections purchased under the Receivables Sale Agreement
irrevocably in Seller, free and clear of any Adverse Claims other than Adverse
Claims in favor of the Agent and the Purchasers (including, without limitation,
the filing of all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect Seller's interest in such Receivables, Related Security and
Collections and such other action to perfect, protect or more fully evidence the
interest of Seller therein as the Agent may reasonably request), and (ii)
establish and maintain, in favor of the Agent, for the benefit of the
Purchasers, a valid and perfected first priority undivided percentage ownership
interest (and/or a valid and perfected first priority security interest) in all
Receivables, Related Security and Collections to the full extent contemplated
herein, free and clear of any Adverse Claims other than Adverse Claims in favor
of the Agent for the benefit of the Purchasers (including, without limitation,
the filing of all financing statements or other similar instruments or documents
necessary under the UCC (or any comparable law) of all appropriate jurisdictions
to perfect the Agent's (for the benefit of the Purchasers) interest in such
Receivables, Related Security and Collections and such other action to perfect,
protect or more fully evidence the interest of the Agent for the benefit of the
Purchasers as the Agent may reasonably request).
(i) Purchasers' Reliance. Seller acknowledges that the
Purchasers are entering into the transactions contemplated by this Agreement in
reliance upon Seller's identity as a legal entity that is separate from
Originator. Therefore, from and after the date of execution and delivery of this
Agreement, Seller shall take all reasonable steps, including, without
limitation, all steps that the Agent or any Purchaser may from time to time
reasonably request, to maintain Seller's identity as a separate legal entity and
to make it manifest to third parties that Seller is an entity with assets and
liabilities distinct from those of Originator and any Affiliates thereof and not
just a division of Originator or any such Affiliate. Without limiting the
generality of the foregoing and in addition to the other covenants set forth
herein, Seller will:
(A) conduct its own business in its own name and
require that all full-time employees of Seller, if any, identify themselves as
such and not as employees of Originator or any Affiliate thereof (including,
without limitation, by means of providing appropriate employees with business or
identification cards identifying such employees as Seller's employees);
Page 17
(B) compensate all employees, consultants and agents
directly, from Seller's own funds, for services provided to Seller by such
employees, consultants and agents and, to the extent any employee, consultant or
agent of Seller is also an employee, consultant or agent of Originator or any
Affiliate thereof, allocate the compensation of such employee, consultant or
agent between Seller and Originator or such Affiliate, as applicable, on a basis
that reflects the services rendered to Seller and Originator or such Affiliate,
as applicable;
(C) clearly identify its offices (by signage or
otherwise) as its offices and, if such office is located in the offices of
Originator or any Affiliate thereof, Seller shall lease such office at a fair
market rent;
(D) have a separate telephone number, which will be
answered only in its name and separate stationery, invoices and checks in its
own name;
(E) conduct all transactions with Originator and the
Servicer and their respective Affiliates (including, without limitation, any
delegation of its obligations hereunder as Servicer) strictly on an arm's-length
basis, allocate all overhead expenses (including, without limitation, telephone
and other utility charges) for items shared between Seller and Originator or any
Affiliate thereof on the basis of actual use to the extent practicable and, to
the extent such allocation is not practicable, on a basis reasonably related to
actual use;
(F) at all times have a Board of Directors consisting
of three members, at least one member of which is an Independent Director;
(G) observe all corporate formalities as a distinct
entity, and ensure that all corporate actions relating to (A) the selection,
maintenance or replacement of the Independent Director, (B) the dissolution or
liquidation of Seller or (C) the initiation of, participation in, acquiescence
in or consent to any bankruptcy, insolvency, reorganization or similar
proceeding involving Seller, are duly authorized by unanimous vote of its Board
of Directors (including the Independent Director);
(H) maintain Seller's books and records separate from
those of Originator and any Affiliate thereof and otherwise readily identifiable
as its own assets rather than assets of Originator and any Affiliate thereof;
(I) prepare its financial statements separately from
those of Originator and insure that any consolidated financial statements of
Originator or any Affiliate thereof that include Seller and that are filed with
the Securities and Exchange Commission or any other governmental agency have
notes clearly stating that Seller is a separate corporate entity and that its
assets will be available first and foremost to satisfy the claims of the
creditors of Seller;
(J) except as herein specifically otherwise provided,
maintain the funds or other assets of Seller separate from, and not commingled
with, those of Originator or any Affiliate thereof and only maintain bank
accounts or other depository accounts to which Seller alone (or the Servicer in
the performance of its duties hereunder) is the account party, into which Seller
alone (or the Servicer in the performance of its duties hereunder) makes
deposits
Page 18
and from which Seller alone ((or the Servicer in the performance of its duties
hereunder) or the Agent hereunder) has the power to make withdrawals;
(K) pay all of Seller's operating expenses from
Seller's own assets (except for certain payments by Originator or other Persons
pursuant to allocation arrangements that comply with the requirements of this
Section 7.1(i));
(L) operate its business and activities such that: it
does not engage in any business or activity of any kind, or enter into any
transaction or indenture, mortgage, instrument, agreement, contract, lease or
other undertaking, other than the transactions contemplated and authorized by
this Agreement and the Receivables Sale Agreement; and does not create, incur,
guarantee, assume or suffer to exist any indebtedness or other liabilities,
whether direct or contingent, other than (1) as a result of the endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business, (2) the incurrence of obligations under this
Agreement, (3) the incurrence of obligations, as expressly contemplated in the
Receivables Sale Agreement, to make payment to Originator thereunder for the
purchase of Receivables from Originator under the Receivables Sale Agreement,
and (4) the incurrence of operating expenses in the ordinary course of business
of the type otherwise contemplated by this Agreement;
(M) maintain its corporate charter in conformity with
this Agreement, such that it does not amend, restate, supplement or otherwise
modify its Certificate of Incorporation or By-Laws in any respect that would
impair its ability to comply with the terms or provisions of any of the
Transaction Documents, including, without limitation, Section 7.1(i) of this
Agreement;
(N) maintain the effectiveness of, and continue to
perform under the Receivables Sale Agreement and the Performance Undertaking,
such that it does not amend, restate, supplement, cancel, terminate or otherwise
modify the Receivables Sale Agreement or the Performance Undertaking, or give
any consent, waiver, directive or approval thereunder or waive any default,
action, omission or breach under the Receivables Sale Agreement or the
Performance Undertaking or otherwise grant any indulgence thereunder, without
(in each case) the prior written consent of the Agent;
(O) maintain its corporate separateness such that it
does not merge or consolidate with or into, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of transactions,
and except as otherwise contemplated herein) all or substantially all of its
assets (whether now owned or hereafter acquired) to, or acquire all or
substantially all of the assets of, any Person, nor at any time create, have,
acquire, maintain or hold any interest in any Subsidiary.
(P) maintain at all times the Required Capital Amount
(as defined in the Receivables Sale Agreement) and refrain from making any
dividend, distribution, redemption of capital stock or payment of any
subordinated indebtedness which would cause the Required Capital Amount to cease
to be so maintained; and
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(Q) take such other actions as are necessary on its
part to ensure that the facts and assumptions set forth in the opinion issued by
Xxxxxx & Xxxxxxx, as counsel for Seller, in connection with the closing or
initial Incremental Purchase under this Agreement and relating to substantive
consolidation issues, and in the certificates accompanying such opinion, remain
true and correct in all material respects at all times.
(j) Collections. Subject to the second sentence of this clause
(j), such Seller Party will cause (1) all proceeds from all Lock-Boxes to be
directly deposited by a Collection Bank into a Collection Account, (2) from and
after September 24, 2002, all Collections to be remitted to a Collection Account
and not the ACH Account, (3) each Lock-Box and Collection Account to be subject
at all times to a Collection Account Agreement that is in full force and effect.
In the event any payments relating to receivables not owned by Seller are
remitted directly to a Lock-Box, Servicer will transfer (or will cause all such
amounts to be transferred) out of the Lock-Box or Collection Account within one
(1) Business Day following discovery thereof. In the event any payments relating
to Receivables are remitted directly to Seller or any Affiliate of Seller,
Seller will remit (or will cause all such payments to be remitted) directly to a
Collection Bank and deposited into a Collection Account within two (2) Business
Days following discovery thereof, and, at all times prior to such remittance,
Seller will itself hold or, if applicable, will cause such payments to be held
in trust for the exclusive benefit of the Agent and the Purchasers. Seller will
maintain exclusive ownership, dominion and control (subject to the terms of this
Agreement) of each Lock-Box and Collection Account and shall not grant the right
to take dominion and control or establish "control" (within the meaning of
Section 9-104 of the UCC of all applicable jurisdictions) of any Lock-Box or
Collection Account at a future time or upon the occurrence of a future event to
any Person, except to the Agent as contemplated by this Agreement. With respect
to each Lock-Box or Collection Account, Seller shall take all steps necessary to
ensure that the Agent has "control" (within the meaning of Section 9-104 of the
UCC of all applicable jurisdictions) over such Lock-Box or Collection Account.
(k) Taxes. To the extent not filed by Ceridian, such Seller
Party will file all tax returns and reports required by law to be filed by it.
To the extent not paid by Ceridian, such Seller Party shall pay and discharge as
the same shall become due and payable, all tax liabilities, assessments and
governmental charges or levies upon it or its properties or assets, unless the
same are being contested in good faith by appropriate proceedings and adequate
reserves in accordance with GAAP are being maintained by such Seller Party,
provided, however, that such Seller Party shall not be deemed to be in default
under this clause (k) if failure to comply herewith would not result in a
Material Adverse Effect. Seller will pay when due any taxes payable in
connection with the Receivables, exclusive of taxes on or measured by income or
gross receipts of Company, the Agent or any Financial Institution.
(l) Insurance. Seller will maintain in effect, or cause to be
maintained in effect, at Seller's own expense, such casualty and liability
insurance as Seller shall deem appropriate in its good faith business judgment.
Seller will pay or cause to be paid, the premiums therefor and deliver to the
Agent evidence satisfactory to the Agent of such insurance coverage. Copies of
each declarations page shall be made available for inspection to the Agent and
any Purchaser upon the Agent's or such Purchaser's request. The foregoing
requirements shall not be construed to negate, reduce or modify, and are in
addition to, Seller's obligations hereunder.
Page 20
(m) Payment to Originator. With respect to any Receivable
purchased by Seller from Originator, such sale shall be effected under, and in
strict compliance with the terms of, the Receivables Sale Agreement, including,
without limitation, the terms relating to the amount and timing of payments to
be made to Originator in respect of the purchase price for such Receivable.
(n) Identification of Receivables. Each Seller Party will
continue to identify receivables belonging to the "Company 1" accounting
classification in the GEAC Accounting System with an account code beginning with
"01000000000" followed by a two-alpha, three numeric identification system.
(o) Shared Security. Upon the request of Agent, each Seller
Party will exercise any and all of its rights to foreclose, draw, collect,
liquidate or otherwise convert to cash or other property any Shared Security
which secures, guarantees or provides other support in respect of any Receivable
for the satisfaction of any defaulted obligation. Immediately upon receipt of
any cash or other proceeds of Shared Security which secure, guarantee or provide
other support in respect of any Receivable, either Seller Party shall deliver
that portion which relates to such Receivable to a Collection Account and, at
all times prior to delivering such proceeds to a Collection Account, such Seller
Party shall hold the same in trust for the benefit of the Agent.
Section 7.2 Negative Covenants of The Seller Parties. Until the date on
which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself, that:
(a) Name Change, Jurisdiction of Organization, Corporate
Structure, Offices and Records. Such Seller Party will not change its name,
identity, jurisdiction of organization or corporate structure (within the
meaning of Sections 9-503 and/or 9-507 of the UCC of all applicable
jurisdictions) or relocate its chief executive office, principal place of
business or any office where Records are kept unless it shall have: (i) given
the Agent at least forty-five (45) days' prior written notice thereof and (ii)
delivered to the Agent all financing statements, instruments and other documents
requested by the Agent in connection with such change or relocation.
(b) Change in Payment Instructions to Obligors. Except as may
be required by the Agent pursuant to Section 8.2(b), such Seller Party will not
add or terminate any bank as a Collection Bank, or make any change in the
instructions to Obligors regarding payments to be made to any Lock-Box or
Collection Account, unless the Agent shall have received, at least ten (10) days
before the proposed effective date therefor, (i) written notice of such
addition, termination or change and (ii) with respect to the addition of a
Collection Bank or a Collection Account or Lock-Box, an executed Collection
Account Agreement with respect to the new Collection Account or Lock-Box;
provided, however, that the Servicer may make changes in instructions to
Obligors regarding payments if such new instructions require such Obligor to
make payments to another existing Collection Account.
(c) Modifications to Contracts and Credit and Collection
Policy. Such Seller Party will not make any change to the Credit and Collection
Policy that could adversely affect the collectibility of the Receivables or
decrease the credit quality of any newly created
Page 21
Receivables. Except as provided in Section 8.2(d), the Servicer will not extend,
amend or otherwise modify the terms of any Receivable or any Contract related
thereto other than in accordance with the Credit and Collection Policy.
(d) Sales, Liens. Seller will not sell, assign (by operation
of law or otherwise) or otherwise dispose of, or grant any option with respect
to, or create or suffer to exist any Adverse Claim upon (including, without
limitation, the filing of any financing statement) or with respect to, any
Receivable, Related Security, Shared Security or Collections, or upon or with
respect to any Contract under which any Receivable arises, or any Lock-Box or
Collection Account, or assign any right to receive income with respect thereto
(other than, in each case, the creation of the interests therein in favor of the
Agent and the Purchasers provided for herein and, solely in the case of Shared
Security, liens in favor of Originator), and Seller will defend the right, title
and interest of the Agent and the Purchasers in, to and under any of the
foregoing property, against all claims of third parties claiming through or
under Seller or Originator. Seller will not create or suffer to exist any
mortgage, pledge, security interest, encumbrance, lien, charge or other similar
arrangement on any of its inventory.
(e) Net Receivables Balance. At no time prior to the
Amortization Date shall Seller permit the Net Receivables Balance to be less
than an amount equal to the sum of (i) the Aggregate Capital plus (ii) the
Aggregate Reserves.
(f) Termination Date Determination. Seller will not designate
the Termination Date (as defined in the Receivables Sale Agreement), or send any
written notice to Originator in respect thereof, without the prior written
consent of the Agent, except with respect to the occurrence of such Termination
Date arising pursuant to Section 5.1(d) of the Receivables Sale Agreement.
(g) Restricted Junior Payments. From and after the occurrence
of any Amortization Event, Seller will not make any Restricted Junior Payment
if, after giving effect thereto, Seller would fail to meet its obligations set
forth in Section 7.2(e).
(h) Collections. Except as contemplated by Section 7.1(j),
Seller will not deposit or otherwise credit, or cause or permit to be so
deposited or credited, to any Collection Account cash or cash proceeds other
than Collections. Except as may be required pursuant to the last sentence of
Section 8.2(b), Seller will not deposit or credit, or cause to be so deposited
or credited, any Collections or proceeds thereof to any lockbox account or to
any other account not covered by a Collection Account Agreement.
ARTICLE VIII.
ADMINISTRATION AND COLLECTION
Section 8.1 Designation of Servicer. (a) The servicing, administration
and collection of the Receivables shall be conducted by such Person (the
"Servicer") so designated from time to time in accordance with this Section
8.1. Comdata is hereby designated as, and hereby agrees to perform the duties
and obligations of, the Servicer pursuant to the terms of this Agreement. The
Agent may at any time after an occurrence and during the continuation of an
Amortization Event
Page 22
or a Specified Potential Amortization Event designate as Servicer any Person to
succeed Comdata or any successor Servicer.
(b) Without the prior written consent of the Agent and the
Required Financial Institutions, Comdata shall not be permitted to delegate any
of its duties or responsibilities as Servicer to any Person other than (i)
Seller, (ii) Performance Guarantor or (iii) with respect to certain Charged-Off
Receivables, outside collection agencies in accordance with its customary
practices. Seller shall not be permitted to further delegate to any other Person
any of the duties or responsibilities of the Servicer delegated to it by
Comdata. If at any time the Agent shall designate as Servicer any Person other
than Comdata, all duties and responsibilities theretofore delegated by Comdata
to Seller may, at the discretion of the Agent, be terminated forthwith on notice
given by the Agent to Comdata and to Seller.
(c) Notwithstanding the foregoing subSection (b), (i) Comdata
shall be and remain primarily liable to the Agent and the Purchasers for the
full and prompt performance of all duties and responsibilities of the Servicer
hereunder and (ii) the Agent and the Purchasers shall be entitled to deal
exclusively with Comdata in matters relating to the discharge by the Servicer of
its duties and responsibilities hereunder. The Agent and the Purchasers shall
not be required to give notice, demand or other communication to any Person
other than Comdata in order for communication to the Servicer and its
sub-servicer or other delegate with respect thereto to be accomplished. Comdata,
at all times that it is the Servicer, shall be responsible for providing any
sub-servicer or other delegate of the Servicer with any notice given to the
Servicer under this Agreement.
Section 8.2 Duties of Servicer. (a) The Servicer shall take or cause
to be taken all such actions as may be necessary or advisable to collect each
Receivable from time to time, all in accordance with applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Credit and Collection Policy.
(b) The Servicer will instruct all Obligors to remit payments
in respect of their Receivables directly to (i) a Lock-Box or Collection Account
or (ii) the Servicer at its Chief Executive Office identified on Exhibit III
hereto. The Servicer shall effect a Collection Account Agreement substantially
in the form of Exhibit VI with each bank party to a Collection Account at any
time. The Servicer shall ensure that from and after September 24, 2002, no
Collections are remitted to the ACH Account. Upon receipt by Comdata of any
remittances constituting Collections or other proceeds of the Receivables or the
Related Security, the Servicer shall cause such amounts to be deposited into a
Collection Account promptly and in every case within two (2) Business Days of
such discovery. In the case of any remittances received in any Lock-Box or
Collection Account that shall have been identified, to the satisfaction of the
Servicer, to not constitute Collections or other proceeds of the Receivables or
the Related Security, the Servicer shall within one (1) Business Day following
discovery thereof, remit such items to the Person identified to it as being the
owner of such remittances. From and after the date the Agent delivers to any
Collection Bank a Collection Notice pursuant to Section 8.3, the Agent may
request that the Servicer, and the Servicer thereupon promptly shall instruct
all Obligors with respect to the Receivables, to remit all payments thereon to a
new depositary account specified by the Agent and, at all times thereafter,
Seller and the Servicer shall not deposit or otherwise
Page 23
credit, and shall not authorize any other Person to deposit or otherwise credit
to such new depositary account any cash or payment item other than Collections.
(c) The Servicer shall administer the Collections in
accordance with the procedures described herein and in Article II. The Servicer
shall set aside and hold in trust for the account of Seller and the Purchasers
their respective shares of the Collections in accordance with Article II. The
Servicer shall, upon the request of the Agent after the occurrence of an
Amortization Event or a Specified Potential Amortization Event, segregate, in a
manner acceptable to the Agent, all cash, checks and other instruments received
by it from time to time constituting Collections from the general funds of the
Servicer or Seller prior to the remittance thereof in accordance with Article
II. If the Servicer shall be required to segregate Collections pursuant to the
preceding sentence, the Servicer shall segregate and deposit with a bank
designated by the Agent such allocable share of Collections of Receivables set
aside for the Purchasers on the first Business Day following receipt by the
Servicer of such Collections, duly endorsed or with duly executed instruments of
transfer.
(d) The Servicer may, in accordance with the Credit and
Collection Policy, extend the maturity of any Receivable or adjust the
Outstanding Balance of any Receivable as the Servicer determines to be
appropriate to maximize Collections thereof; provided, however, that such
extension or adjustment shall not alter the status of such Receivable as a
Delinquent Receivable or Charged-Off Receivable or limit the rights of the Agent
or the Purchasers under this Agreement. Notwithstanding anything to the contrary
contained herein, the Agent shall have the absolute and unlimited right to
direct the Servicer to commence or settle any legal action with respect to any
Receivable or to foreclose upon or repossess any Related Security after the
occurrence of an Amortization Event or a Specified Potential Amortization Event.
(e) The Servicer shall hold in trust for Seller and the
Purchasers all Records that (i) evidence or relate to the Receivables, the
related Contracts and Related Security or (ii) are otherwise necessary or
desirable to collect the Receivables. The Servicer shall, as soon as
practicable, (A) prior to an Amortization Event or a Specified Potential
Amortization Event, upon the request of Agent, make available to the Agent all
Records, at the Servicer's offices or other locations where it maintains such
Records, and (B) after the occurrence of an Amortization Event or a Specified
Potential Amortization Event, upon demand of the Agent, make available or
deliver to the Agent all such Records, at a place selected by the Agent. The
Servicer shall, from time to time at the request of any Purchaser, furnish to
the Purchasers (promptly after any such request) a calculation of the amounts
set aside for the Purchasers pursuant to Article II.
(f) Subject to clause (b) hereof, any payment by an Obligor in
respect of any Indebtedness owed by it to Originator or Seller shall, except as
otherwise specified by such Obligor or as otherwise ascertained by the Servicer
within four (4) Business Days of receipt, or as otherwise required by contract
or law and unless otherwise instructed by the Agent, be applied as a Collection
of any 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 or other obligation of such Obligor.
Section 8.3 Collection Notices. The Agent is authorized at any time
after the occurrence of an Amortization Event or a Potential Amortization Event
to date and to deliver to
Page 24
the Collection Banks the Collection Notices. Seller hereby transfers to the
Agent for the benefit of the Purchasers, effective when the Agent delivers such
notice, the dominion and control and "control" (within the meaning of Section
9-104 of the UCC of all applicable jurisdictions) of each Lock-Box and the
Collection Accounts and the amounts deposited therein. In case any authorized
signatory of Seller whose signature appears on a Collection Account Agreement
shall cease to have such authority before the delivery of such notice, such
Collection Notice shall nevertheless be valid as if such authority had remained
in force. Seller hereby authorizes the Agent, and agrees that the Agent shall be
entitled to (i) endorse Seller's name on checks and other instruments
representing Collections, (ii) enforce the Receivables, the related Contracts
and the Related Security and (iii) take such action as shall be necessary or
desirable to cause all cash, checks and other instruments constituting
Collections of Receivables to come into the possession of the Agent rather than
Seller.
Section 8.4 Responsibilities of Seller. Anything herein to the contrary
notwithstanding, the exercise by the Agent and the Purchasers of their rights
hereunder shall not release the Servicer, Originator or Seller from any of their
duties or obligations with respect to any Receivables or under the related
Contracts. The Purchasers shall have no obligation or liability with respect to
any Receivables or related Contracts, nor shall any of them be obligated to
perform the obligations of Seller.
Section 8.5 Reports. The Servicer shall prepare and forward to the
Agent (i) on the 18th day of each month or, if such day is not a Business Day,
on the next succeeding Business Day and at such times as the Agent shall
request, a Settlement Report and (ii) at such times as the Agent shall request,
a listing by Obligor of all Receivables together with an aging of such
Receivables.
Section 8.6 Servicing Fees. In consideration of Comdata's agreement to
act as Servicer hereunder, the Purchasers hereby agree that, so long as Comdata
shall continue to perform as Servicer hereunder, Seller shall pay over to
Comdata a fee (the "Servicing Fee") on the first calendar day of each month, in
arrears for the immediately preceding month, equal to 1.0% per annum of the
average aggregate Outstanding Balance of all Receivables during such period, as
compensation for its servicing activities.
ARTICLE IX.
AMORTIZATION EVENTS
Section 9.1 Amortization Events. The occurrence of any one or more of
the following events shall constitute an Amortization Event:
(a) Any Seller Party shall fail (i) to make any payment or
deposit required hereunder when due, or (ii) to perform or observe any term,
covenant or agreement hereunder (other than as referred to in clause (i) of this
paragraph (a) and paragraph 9.1(e)) or under any other Transaction Document and
such failure shall continue for five (5) consecutive Business Days.
(b) Any representation, warranty, certification or statement
made by any Seller Party in this Agreement, any other Transaction Document or in
any other document
Page 25
delivered pursuant hereto or thereto shall prove to have been incorrect when
made or deemed made.
(c) Failure of Seller to pay any Indebtedness when due or the
failure of any other Seller Party or Ceridian to pay Indebtedness when due; or
the default by any Seller Party or Ceridian in the performance of any term,
provision or condition contained in any agreement under which any such
Indebtedness was created or is governed, the effect of which is to cause, or to
permit the holder or holders of such Indebtedness to cause, such Indebtedness to
become due prior to its stated maturity; or any such Indebtedness of any Seller
Party or Ceridian 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.
(d) (i) Performance Guarantor, any Seller Party, 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 (ii) any
proceeding shall be instituted by or against Performance Guarantor, any Seller
Party, or any of their respective Subsidiaries seeking to adjudicate it 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 (iii) Performance Guarantor, any Seller Party or any of their respective
Subsidiaries shall take any corporate action to authorize any of the actions set
forth in clauses (i) or (ii) above in this subSection (d).
(e) Seller shall fail to comply with the terms of Section 2.6
hereof.
(f) (i) As at the end of any calendar month, the Collections
to Sales Ratio for such calendar month shall be less than 90%; or (ii) as at the
end of any calendar month ending after August, 2002, the average of the
Delinquency Ratios for the three most recently-ended calendar months shall
exceed the Delinquent Receivables Trigger Amount.
(g) A Change of Control shall occur.
(h) (i) One or more final judgments for the payment of money
shall be entered against Seller or (ii) one or more final judgments for the
payment of money in an amount in excess of $10,000,000, individually or in the
aggregate, shall be entered against the Servicer on claims not covered by
insurance or as to which the insurance carrier has denied its responsibility,
and such judgment shall continue unsatisfied and in effect for thirty (30)
consecutive days without a stay of execution.
(i) The "Termination Date" under and as defined in the
Receivables Sale Agreement shall occur under the Receivables Sale Agreement or
Originator shall for any reason cease to transfer, or cease to have the legal
capacity to transfer, or otherwise be incapable of transferring Receivables to
Seller under the Receivables Sale Agreement or Seller shall for any reason cease
to purchase, or cease to have the legal capacity to purchase, or otherwise be
incapable of accepting Receivables from Originator under the Receivables Sale
Agreement.
Page 26
(j) This Agreement shall terminate in whole or in part (except
in accordance with its terms), or shall cease to be effective or to be the
legally valid, binding and enforceable obligation of Seller, or any Obligor
shall directly or indirectly contest in any manner such effectiveness, validity,
binding nature or enforceability, or the Agent for the benefit of the Purchasers
shall cease to have a valid and perfected first priority security interest in
the Receivables, the Related Security and the Collections with respect thereto
and the Collection Accounts.
(k) Performance Guarantor shall fail to perform or observe any
term, covenant or agreement required to be performed by it under the Performance
Undertaking, or the Performance Undertaking shall cease to be effective or to be
the legally valid, binding and enforceable obligation of Performance Guarantor,
or Performance Guarantor shall directly or indirectly contest in any manner such
effectiveness, validity, binding nature or enforceability.
Section 9.2 Remedies. Upon the occurrence and during the continuation
of an Amortization Event, the Agent may, or upon the direction of the Required
Financial Institutions shall, take any of the following actions: (i) replace the
Person then acting as Servicer, (ii) declare the Amortization Date to have
occurred, whereupon the Amortization Date shall forthwith occur, without demand,
protest or further notice of any kind, all of which are hereby expressly waived
by each Seller Party; provided, however, that upon the occurrence of an
Amortization Event described in Section 9.1(d)(ii), or of an actual or deemed
entry of an order for relief with respect to any Seller Party under the Federal
Bankruptcy Code, the Amortization Date shall automatically occur, without
demand, protest or any notice of any kind, all of which are hereby expressly
waived by each Seller Party, (iii) to the fullest extent permitted by applicable
law, declare that the Default Fee shall accrue with respect to any of the
Aggregate Unpaids outstanding at such time, (iv) deliver the Collection Notices
to the Collection Banks, and (v) notify Obligors of the Purchasers' interest in
the Receivables. The aforementioned rights and remedies shall be without
limitation, and shall be in addition to all other rights and remedies of the
Agent and the Purchasers otherwise available under any other provision of this
Agreement, by operation of law, at equity or otherwise, all of which are hereby
expressly preserved, including, without limitation, all rights and remedies
provided under the UCC, all of which rights shall be cumulative.
ARTICLE X.
INDEMNIFICATION
Section 10.1 Indemnities by The Seller Parties. Without limiting any
other rights that the Agent or any Purchaser may have hereunder or under
applicable law, (A) Seller hereby agrees to indemnify (and pay upon demand to)
the Agent and each Purchaser and their respective assigns, officers, directors,
agents and employees (each an "Indemnified Party") from and against any and all
damages, losses, claims, taxes, liabilities, costs, expenses and for all other
amounts payable, including reasonable attorneys' fees (which attorneys may be
employees of the Agent or such Purchaser) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts") awarded
against or incurred by any of them arising out of or as a result of this
Agreement or the acquisition, either directly or indirectly, by a Purchaser of
an interest in the Receivables, and (B) the Servicer hereby agrees to indemnify
(and pay upon demand to) each Indemnified Party for Indemnified Amounts awarded
against or incurred by any of them arising
Page 27
out of the Servicer's activities as Servicer hereunder excluding, however, in
all of the foregoing instances under the preceding clauses (A) and (B):
(a) Indemnified Amounts to the extent a final judgment of a
court of competent jurisdiction holds that such Indemnified Amounts resulted
from gross negligence or willful misconduct on the part of the Indemnified Party
seeking indemnification;
(b) Indemnified Amounts to the extent the same includes losses
in respect of Receivables that are uncollectible on account of the insolvency,
bankruptcy or lack of creditworthiness of the related Obligor; or
(c) taxes imposed by the United States, the Indemnified
Party's jurisdiction of organization (or, in the case of an individual, primary
residence) or any other jurisdiction in which such Indemnified Party has
established a taxable nexus other than in connection with the transactions
contemplated hereby and by this Agreement, in any case on or measured by the
overall net income of such Indemnified Party to the extent that the computation
of such taxes is consistent with the Intended Characterization;
provided, however, that nothing contained in this sentence shall limit the
liability of any Seller Party or limit the recourse of the Purchasers to any
Seller Party for amounts otherwise specifically provided to be paid by such
Seller Party under the terms of this Agreement. Without limiting the generality
of the foregoing indemnification, Seller shall indemnify each Indemnified Party
for Indemnified Amounts (including, without limitation, losses in respect of
uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to Seller or the Servicer) relating to or resulting from:
(i) any representation or warranty made by
Performance Guarantor, any Seller Party or Originator (or any officers
of any such Person) under or in connection with this Agreement, any
other Transaction Document or any other information or report delivered
by any such Person pursuant hereto or thereto, which shall have been
false or incorrect when made or deemed made;
(ii) the failure by Seller, the Servicer or
Originator to comply with any applicable law, rule or regulation with
respect to any Receivable or contract related thereto, or the
nonconformity of any Receivable or contract included therein with any
such applicable law, rule or regulation or any failure of Originator to
keep or perform any of its obligations, express or implied, with
respect to any such contract;
(iii) any failure of Performance Guarantor, Seller,
the Servicer or Originator to perform its duties, covenants or other
obligations in accordance with the provisions of this Agreement or any
other Transaction Document to which they are parties;
(iv) any products liability, personal injury or
damage suit, or other similar claim arising out of or in connection
with merchandise, insurance or services that are the subject of any
contract related to any Receivable or any Receivable;
Page 28
(v) 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 the
merchandise or service related to such Receivable or the furnishing or
failure to furnish such merchandise or services;
(vi) the commingling of Collections of Receivables at
any time with other funds;
(vii) any investigation, litigation or proceeding
related to or arising from this Agreement or any other Transaction
Document, the transactions contemplated hereby, the use of the proceeds
of an Incremental Purchase or a Reinvestment, the ownership of the
Purchaser Interests or any other investigation, litigation or
proceeding relating to Seller, the Servicer or Originator in which any
Indemnified Party becomes involved as a result of any of the
transactions contemplated hereby;
(viii) any inability to litigate any claim against
any Obligor in respect of any Receivable as a result of such Obligor
being immune from civil and commercial law and suit on the grounds of
sovereignty or otherwise from any legal action, suit or proceeding;
(ix) any Amortization Event described in Section
9.1(d);
(x) any failure of Seller to acquire and maintain
legal and equitable title to, and ownership of any Receivable and the
Related Security (whether or not such Related Security is covered by
Article 9 of the UCC), Shared Security and Collections with respect
thereto from Originator, free and clear of any Adverse Claim (other
than as created hereunder); or any failure of Seller to give reasonably
equivalent value to Originator under the Receivables Sale Agreement in
consideration of the transfer by Originator of any Receivable, or any
attempt by any Person to void such transfer under statutory provisions
or common law or equitable action;
(xi) any failure to vest and maintain vested in the
Agent for the benefit of the Purchasers, or to transfer to the Agent
for the benefit of the Purchasers, legal and equitable title to, and
ownership of, a first priority perfected undivided percentage ownership
interest (to the extent of the Purchaser Interests contemplated
hereunder) or security interest in the Receivables, the Related
Security (whether or not such Related Security is covered by Article 9
of the UCC), Shared Security and the Collections, free and clear of any
Adverse Claim (except as created by the Transaction Documents);
(xii) the failure to have filed, or any delay in
filing, financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable laws
with respect to any Receivable, the Related Security
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(whether or not such Related Security is covered by Article 9 of the
UCC), Shared Security and Collections with respect thereto, and the
proceeds of any thereof, whether at the time of any Incremental
Purchase or Reinvestment or at any subsequent time;
(xiii) any action or omission by any Seller Party
which reduces or impairs the rights of the Agent or the Purchasers with
respect to any Receivable or the value of any such Receivable;
(xiv) any attempt by any Person to void any
Incremental Purchase or Reinvestment hereunder under statutory
provisions or common law or equitable action; and
(xv) the failure of any Receivable included in the
calculation of the Net Receivables Balance as an Eligible Receivable to
be an Eligible Receivable at the time so included.
Section 10.2 Increased Cost and Reduced Return.
If after the date hereof, any Funding Source shall be charged
any fee, expense or increased cost on account of the adoption of any applicable
law, rule or regulation (including any applicable law, rule or regulation
regarding capital adequacy) or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance with any request or directive (whether or not having the
force of law) of any such authority, central bank or comparable agency (a
"Regulatory Change"): (i) that subjects any Funding Source to any charge or
withholding on or with respect to any Funding Agreement or a Funding Source's
obligations under a Funding Agreement, or on or with respect to the Receivables,
or changes the basis of taxation of payments to any Funding Source of any
amounts payable under any Funding Agreement (except for changes in the rate of
tax on the overall net income of a Funding Source or taxes excluded by Section
10.1) or (ii) that imposes, modifies or deems applicable any reserve,
assessment, insurance charge, special deposit or similar requirement against
assets of, deposits with or for the account of a Funding Source, or credit
extended by a Funding Source pursuant to a Funding Agreement or (iii) that
imposes any other condition the result of which is to increase the cost to a
Funding Source of performing its obligations under a Funding Agreement, or to
reduce the rate of return on a Funding Source's capital as a consequence of its
obligations under a Funding Agreement, or to reduce the amount of any sum
received or receivable by a Funding Source under a Funding Agreement or to
require any payment calculated by reference to the amount of interests or loans
held or interest received by it, then, upon demand by the Agent, Seller shall
pay to the Agent, for the benefit of the relevant Funding Source, such amounts
charged to such Funding Source or such amounts to otherwise compensate such
Funding Source for such increased cost or such reduction.
Section 10.3 Other Costs and Expenses. Seller shall reimburse the Agent
and Company on demand for all invoiced and reasonable costs and out-of-pocket
expenses in connection with the preparation, execution, delivery and
administration of this Agreement, the transactions contemplated hereby and the
other documents to be delivered hereunder, including without limitation, the
cost of Company's auditors auditing the books, records and procedures of Seller,
Page 30
reasonable fees and out-of-pocket expenses of legal counsel for Company and the
Agent (which such counsel may be employees of Company or the Agent) with respect
thereto and with respect to advising Company and the Agent as to their
respective rights and remedies under this Agreement. Seller shall reimburse the
Agent on demand for any and all costs and expenses of the Agent and the
Purchasers, if any, including reasonable counsel fees and expenses in connection
with the enforcement of this Agreement and the other documents delivered
hereunder and in connection with any restructuring or workout of this Agreement
or such documents, or the administration of this Agreement following an
Amortization Event.
ARTICLE XI.
THE AGENT
Section 11.1 Authorization and Action. Each Purchaser hereby designates
and appoints Bank One to act as its agent hereunder and under each other
Transaction Document, and authorizes the Agent to take such actions as agent on
its behalf and to exercise such powers as are delegated to the Agent by the
terms of this Agreement and the other Transaction Documents together with such
powers as are reasonably incidental thereto. The Agent shall not have any duties
or responsibilities, except those expressly set forth herein or in any other
Transaction Document, or any fiduciary relationship with any Purchaser, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of the Agent shall be read into this Agreement or any
other Transaction Document or otherwise exist for the Agent. In performing its
functions and duties hereunder and under the other Transaction Documents, the
Agent shall act solely as agent for the Purchasers and does not assume nor shall
be deemed to have assumed any obligation or relationship of trust or agency with
or for any Seller Party or any of such Seller Party's successors or assigns. The
Agent shall not be required to take any action that exposes the Agent to
personal liability or that is contrary to this Agreement, any other Transaction
Document or applicable law. The appointment and authority of the Agent hereunder
shall terminate upon the indefeasible payment in full of all Aggregate Unpaids.
Each Purchaser hereby authorizes the Agent to execute each of the Uniform
Commercial Code financing or continuation statements (and amendments thereto and
assignments or terminations thereof) on behalf of such Purchaser (the terms of
which shall be binding on such Purchaser).
Section 11.2 Delegation of Duties. The Agent may execute any of its
duties under this Agreement and each other Transaction Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.
Section 11.3 Exculpatory Provisions. Neither the Agent nor any of its
directors, officers, agents or employees shall be (i) liable for any action
lawfully taken or omitted to be taken by it or them under or in connection with
this Agreement or any other Transaction Document (except for its, their or such
Person's own gross negligence or willful misconduct), or (ii) responsible in any
manner to any of the Purchasers for any recitals, statements, representations or
warranties made by any Seller Party contained in this Agreement, any other
Transaction Document or any certificate, report, statement or other document
referred to or provided for in, or received under or in connection with, this
Agreement, or any other Transaction Document or for the value, validity,
effectiveness, genuineness, enforceability or
Page 31
sufficiency of this Agreement, or any other Transaction Document or any other
document furnished in connection herewith or therewith, or for any failure of
any Seller Party to perform its obligations hereunder or thereunder, or for the
satisfaction of any condition specified in Article VI, or for the perfection,
priority, condition, value or sufficiency of any collateral pledged in
connection herewith. The Agent shall not be under any obligation to any
Purchaser to ascertain or to inquire as to the observance or performance of any
of the agreements or covenants contained in, or conditions of, this Agreement or
any other Transaction Document, or to inspect the properties, books or records
of the Seller Parties. The Agent shall not be deemed to have knowledge of any
Amortization Event or Potential Amortization Event unless the Agent has received
notice from Seller or a Purchaser.
Section 11.4 Reliance by Agent. The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to Seller), independent
accountants and other experts selected by the Agent. The Agent shall in all
cases be fully justified in failing or refusing to take any action under this
Agreement or any other Transaction Document unless it shall first receive such
advice or concurrence of Company or the Required Financial Institutions or all
of the Purchasers, as applicable, as it deems appropriate and it shall first be
indemnified to its satisfaction by the Purchasers, provided that unless and
until the Agent shall have received such advice, the Agent may take or refrain
from taking any action, as the Agent shall deem advisable and in the best
interests of the Purchasers. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, in accordance with a request of Company or
the Required Financial Institutions or all of the Purchasers, as applicable, and
such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Purchasers.
Section 11.5 Non-Reliance on Agent and Other Purchasers. Each Purchaser
expressly acknowledges that neither the Agent, nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by the Agent hereafter
taken, including, without limitation, any review of the affairs of any Seller
Party, shall be deemed to constitute any representation or warranty by the
Agent. Each Purchaser represents and warrants to the Agent that it has and will,
independently and without reliance upon the Agent or any other Purchaser and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of Seller and
made its own decision to enter into this Agreement, the other Transaction
Documents and all other documents related hereto or thereto.
Section 11.6 Reimbursement and Indemnification. The Financial
Institutions agree to reimburse and indemnify the Agent and its officers,
directors, employees, representatives and agents ratably according to their Pro
Rata Shares, to the extent not paid or reimbursed by the Seller Parties (i) for
any amounts for which the Agent, acting in its capacity as Agent, is entitled to
reimbursement by the Seller Parties hereunder and (ii) for any other expenses
incurred by the Agent, in its capacity as Agent and acting on behalf of the
Purchasers, in connection with the administration and enforcement of this
Agreement and the other Transaction Documents.
Page 32
Section 11.7 Agent in its Individual Capacity. The Agent and its
Affiliates may make loans to, accept deposits from and generally engage in any
kind of business with Seller or any Affiliate of Seller as though the Agent were
not the Agent hereunder. With respect to the acquisition of Purchaser Interests
pursuant to this Agreement, the Agent shall have the same rights and powers
under this Agreement in its individual capacity as any Purchaser and may
exercise the same as though it were not the Agent, and the terms "Financial
Institution," "Purchaser," "Financial Institutions" and "Purchasers" shall
include the Agent in its individual capacity.
Section 11.8 Successor Agent. The Agent may, upon five days' notice to
Seller and the Purchasers, and the Agent will, upon the direction of all of the
Purchasers (other than the Agent, in its individual capacity) resign as Agent.
If the Agent shall resign, then the Required Financial Institutions during such
five-day period shall appoint from among the Purchasers a successor agent. If
for any reason no successor Agent is appointed by the Required Financial
Institutions during such five-day period, then effective upon the termination of
such five day period, the Purchasers shall perform all of the duties of the
Agent hereunder and under the other Transaction Documents and Seller and the
Servicer (as applicable) shall make all payments in respect of the Aggregate
Unpaids directly to the applicable Purchasers and for all purposes shall deal
directly with the Purchasers. After the effectiveness of any retiring Agent's
resignation hereunder as Agent, the retiring Agent shall be discharged from its
duties and obligations hereunder and under the other Transaction Documents and
the provisions of this Article XI and Article X shall continue in effect for its
benefit with respect to any actions taken or omitted to be taken by it while it
was Agent under this Agreement and under the other Transaction Documents.
ARTICLE XII.
ASSIGNMENTS; PARTICIPATIONS
Section 12.1 Assignments. (a)(a) Seller and each Financial Institution
hereby agree and consent to the complete or partial assignment by Company of all
or any portion of its rights under, interest in, title to and obligations under
this Agreement to the Financial Institutions pursuant to Section 13.1 or to any
other Person, and upon such assignment, Company shall be released from its
obligations so assigned. Further, Seller and each Financial Institution hereby
agree that any assignee of Company of this Agreement or all or any of the
Purchaser Interests of Company shall have all of the rights and benefits under
this Agreement as if the term "Company" explicitly referred to such party, and
no such assignment shall in any way impair the rights and benefits of Company
hereunder. Neither Seller nor the Servicer shall have the right to assign its
rights or obligations under this Agreement.
(b) Any Financial Institution may at any time and from time to
time assign to one or more Persons ("Purchasing Financial Institutions") all or
any part of its rights and obligations under this Agreement pursuant to an
assignment agreement, substantially in the form set forth in Exhibit VII hereto
(the "Assignment Agreement") executed by such Purchasing Financial Institution
and such selling Financial Institution. The consent of Company shall be required
prior to the effectiveness of any such assignment. Each assignee of a Financial
Institution must (i) have a short-term debt rating of A-1 or better by Standard
& Poor's Ratings Group and P-1 by Xxxxx'x Investor Service, Inc. and (ii) agree
to deliver to the Agent, promptly following any request therefor by the Agent or
Company, an enforceability opinion in form and
Page 33
substance satisfactory to the Agent and Company. Upon delivery of the executed
Assignment Agreement to the Agent, such selling Financial Institution shall be
released from its obligations hereunder to the extent of such assignment.
Thereafter the Purchasing Financial Institution shall for all purposes be a
Financial Institution party to this Agreement and shall have all the rights and
obligations of a Financial Institution under this Agreement to the same extent
as if it were an original party hereto and no further consent or action by
Seller, the Purchasers or the Agent shall be required.
(c) Each of the Financial Institutions agrees that in the
event that it shall cease to have a short-term debt rating of A-1 or better by
Standard & Poor's Ratings Group and P-1 by Xxxxx'x Investor Service, Inc. (an
"Affected Financial Institution"), such Affected Financial Institution shall be
obliged, at the request of Company or the Agent, to assign all of its rights and
obligations hereunder to (x) another Financial Institution or (y) another
funding entity nominated by the Agent and acceptable to Company, and willing to
participate in this Agreement through the Liquidity Termination Date in the
place of such Affected Financial Institution; provided that the Affected
Financial Institution receives payment in full, pursuant to an Assignment
Agreement, of an amount equal to such Financial Institution's Pro Rata Share of
the Aggregate Capital and Yield owing to the Financial Institutions and all
accrued but unpaid fees and other costs and expenses payable in respect of its
Pro Rata Share of the Purchaser Interests of the Financial Institutions.
Section 12.2 Participations. Any Financial Institution may, in the
ordinary course of its business at any time sell to one or more Persons (each a
"Participant") participating interests in its Pro Rata Share of the Purchaser
Interests of the Financial Institutions, its obligation to pay Company its
Acquisition Amounts or any other interest of such Financial Institution
hereunder. Notwithstanding any such sale by a Financial Institution of a
participating interest to a Participant, such Financial Institution's rights and
obligations under this Agreement shall remain unchanged, such Financial
Institution shall remain solely responsible for the performance of its
obligations hereunder, and Seller, Company and the Agent shall continue to deal
solely and directly with such Financial Institution in connection with such
Financial Institution's rights and obligations under this Agreement. Each
Financial Institution agrees that any agreement between such Financial
Institution and any such Participant in respect of such participating interest
shall not restrict such Financial Institution's right to agree to any amendment,
supplement, waiver or modification to this Agreement, except for any amendment,
supplement, waiver or modification described in Section 14.1(b)(i).
ARTICLE XIII.
LIQUIDITY FACILITY
Section 13.1 Transfer to Financial Institutions. Each Financial
Institution hereby agrees, subject to Section 13.4, that immediately upon
written notice from Company delivered on or prior to the Liquidity Termination
Date, it shall acquire by assignment from Company, without recourse or warranty,
its Pro Rata Share of one or more of the Purchaser Interests of Company as
specified by Company. Each such assignment by Company shall be made pro rata
among all of the Financial Institutions, except for pro rata assignments to one
or more Terminating Financial Institutions pursuant to Section 13.6. Each such
Financial Institution shall, no later than 1:00 p.m. (Chicago time) on the date
of such assignment, pay in immediately
Page 34
available funds (unless another form of payment is otherwise agreed between
Company and any Financial Institution) to Company at an account designated by
Company, its Acquisition Amount. Unless a Financial Institution has notified the
Agent that it does not intend to pay its Acquisition Amount, the Agent may
assume that such payment has been made and may, but shall not be obligated to,
make the amount of such payment available to Company in reliance upon such
assumption. Company hereby sells and assigns to the Agent for the ratable
benefit of the Financial Institutions, and the Agent hereby purchases and
assumes from Company, effective upon the receipt by Company of the Company
Transfer Price, the Purchaser Interests of Company which are the subject of any
transfer pursuant to this Article XIII.
Section 13.2 Transfer Price Reduction Yield. If the Adjusted Funded
Amount is included in the calculation of the Company Transfer Price for any
Purchaser Interest, each Financial Institution agrees that the Agent shall pay
to Company the Reduction Percentage of any Yield received by the Agent with
respect to such Purchaser Interest.
Section 13.3 Payments to Company. In consideration for the reduction of
the Company Transfer Prices by the Company Transfer Price Reductions, effective
only at such time as the aggregate amount of the Capital of the Purchaser
Interests of the Financial Institutions equals the Company Residual, each
Financial Institution hereby agrees that the Agent shall not distribute to the
Financial Institutions and shall immediately remit to Company any Yield,
Collections or other payments received by it to be applied pursuant to the terms
hereof or otherwise to reduce the Capital of the Purchaser Interests of the
Financial Institutions.
Section 13.4 Limitation on Commitment to Purchase from Company.
Notwithstanding anything to the contrary in this Agreement, no Financial
Institution shall have any obligation to purchase any Purchaser Interest from
Company, pursuant to Section 13.1 or otherwise, if:
(i) Company shall have voluntarily commenced any
proceeding or filed any petition under any bankruptcy, insolvency or
similar law seeking the dissolution, liquidation or reorganization of
Company or taken any corporate action for the purpose of effectuating
any of the foregoing; or
(ii) involuntary proceedings or an involuntary
petition shall have been commenced or filed against Company by any
Person under any bankruptcy, insolvency or similar law seeking the
dissolution, liquidation or reorganization of Company and such
proceeding or petition shall have not been dismissed.
Section 13.5 Defaulting Financial Institutions. If one or more
Financial Institutions defaults in its obligation to pay its Acquisition Amount
pursuant to Section 13.1 (each such Financial Institution shall be called a
"Defaulting Financial Institution" and the aggregate amount of such defaulted
obligations being herein called the "Company Transfer Price Deficit"), then upon
notice from the Agent, each Financial Institution other than the Defaulting
Financial Institutions (a "Non-Defaulting Financial Institution") shall promptly
pay to the Agent, in immediately available funds, an amount equal to the lesser
of (x) such Non-Defaulting Financial Institution's proportionate share (based
upon the relative Commitments of the Non-Defaulting Financial Institutions) of
the Company Transfer Price Deficit and (y) the unused portion of such
Non-Defaulting Financial Institution's Commitment. A Defaulting Financial
Institution shall
Page 35
forthwith upon demand pay to Company for the account of the Non-Defaulting
Financial Institutions all amounts paid by each Non-Defaulting Financial
Institution on behalf of such Defaulting Financial Institution, together with
interest thereon, for each day from the date a payment was made by a
Non-Defaulting Financial Institution until the date such Non-Defaulting
Financial Institution has been paid such amounts in full, at a rate per annum
equal to the Federal Funds Effective Rate plus two percent (2%). In addition,
without prejudice to any other rights that Company may have under applicable
law, each Defaulting Financial Institution shall pay to Company forthwith upon
demand, the difference between such Defaulting Financial Institution's unpaid
Acquisition Amount and the amount paid with respect thereto by the
Non-Defaulting Financial Institutions, together with interest thereon, for each
day from the date of the Agent's request for such Defaulting Financial
Institution's Acquisition Amount pursuant to Section 13.1 until the date the
requisite amount is paid to Company in full, at a rate per annum equal to the
Federal Funds Effective Rate plus two percent (2%).
Section 13.6 Terminating Financial Institutions.
(a) Each Financial Institution hereby agrees to deliver
written notice to the Agent not more than 30 Business Days and not less than 5
Business Days prior to the Liquidity Termination Date indicating whether such
Financial Institution intends to renew its Commitment hereunder. If any
Financial Institution fails to deliver such notice on or prior to the date that
is 5 Business Days prior to the Liquidity Termination Date, such Financial
Institution will be deemed to have declined to renew its Commitment (each
Financial Institution which has declined or has been deemed to have declined to
renew its Commitment hereunder, a "Non-Renewing Financial Institution"). The
Agent shall promptly notify Company of each Non-Renewing Financial Institution
and Company, in its sole discretion, may (A) to the extent of Commitment
Availability, declare that such Non-Renewing Financial Institution's Commitment
shall, to such extent, automatically terminate on a date specified by Company on
or before the Liquidity Termination Date or (B) upon one (1) Business Days'
notice to such Non-Renewing Financial Institution assign to such Non-Renewing
Financial Institution on a date specified by Company its Pro Rata Share of the
aggregate Purchaser Interests then held by Company, subject to, and in
accordance with, Section 13.1. In addition, Company may, in its sole discretion,
at any time (x) to the extent of Commitment Availability, declare that any
Affected Financial Institution's Commitment shall automatically terminate on a
date specified by Company or (y) assign to any Affected Financial Institution on
a date specified by Company its Pro Rata Share of the aggregate Purchaser
Interests then held by Company, subject to, and in accordance with, Section 13.1
(each Affected Financial Institution or each Non-Renewing Financial Institution
is hereinafter referred to as a "Terminating Financial Institution"). The
parties hereto expressly acknowledge that any declaration of the termination of
any Commitment, any assignment pursuant to this Section 13.6 and the order of
priority of any such termination or assignment among Terminating Financial
Institutions shall be made by Company in its sole and absolute discretion.
(b) Upon any assignment to a Terminating Financial Institution
as provided in this Section 13.6, any remaining Commitment of such Terminating
Financial Institution shall automatically terminate. Upon reduction to zero of
the Capital of all of the Purchaser Interests of a Terminating Financial
Institution (after application of Collections thereto pursuant to Sections 2.2
and 2.3) all rights and obligations of such Terminating Financial Institution
Page 36
hereunder shall be terminated and such Terminating Financial Institution shall
no longer be a "Financial Institution" hereunder; provided, however, that the
provisions of Article X shall continue in effect for its benefit with respect
to Purchaser Interests held by such Terminating Financial Institution prior to
its termination as a Financial Institution.
ARTICLE XIV.
MISCELLANEOUS
Section 14.1 Waivers and Amendments. (a) (a) No failure or delay on the
part of the Agent or any Purchaser in exercising any power, right or remedy
under this Agreement shall operate as 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 waiver of this Agreement shall be effective
only in the specific instance and for the specific purpose for which given.
(b) No provision of this Agreement may be amended,
supplemented, modified or waived except in writing in accordance with the
provisions of this Section 14.1(b). Company, Seller and the Agent, at the
direction of the Required Financial Institutions, may enter into written
modifications or waivers of any provisions of this Agreement, provided, however,
that no such modification or waiver shall:
(i) without the consent of each affected Purchaser,
(A) extend the Liquidity Termination Date or the date of any payment or
deposit of Collections by Seller or the Servicer, (B) reduce the rate
or extend the time of payment of Yield or any CP Costs (or any
component of Yield or CP Costs), (C) reduce any fee payable to the
Agent for the benefit of the Purchasers, (D) except pursuant to Article
XII hereof, change the amount of the Capital of any Purchaser, any
Financial Institution's Pro Rata Share (except pursuant to Sections
13.1 or 13.5) or any Financial Institution's Commitment, (E) amend,
modify or waive any provision of the definition of Required Financial
Institutions or this Section 14.1(b), (F) consent to or permit the
assignment or transfer by Seller of any of its rights and obligations
under this Agreement, (G) change the definition of "Eligible
Receivable," "Loss Reserve," "Loss Percentage," "Dilution Reserve,"
"Dilution Ratio," or "Discount Reserve" or (H) amend or modify any
defined term (or any defined term used directly or indirectly in such
defined term) used in clauses (A) through (G) above in a manner that
would circumvent the intention of the restrictions set forth in such
clauses; or
(ii) without the written consent of the then Agent,
amend, modify or waive any provision of this Agreement if the effect
thereof is to affect the rights or duties of such Agent.
Notwithstanding the foregoing, (i) without the consent of the Financial
Institutions, but with the consent of Seller, the Agent may amend this Agreement
solely to add additional Persons as Financial Institutions hereunder and (ii)
the Agent, the Required Financial Institutions and Company may enter into
amendments to modify any of the terms or provisions of Article XI, Article XII,
Section 14.13 or any other provision of this Agreement without the consent of
Seller,
Page 37
provided that such amendment has no negative impact upon Seller. Any
modification or waiver made in accordance with this Section 14.1 shall apply to
each of the Purchasers equally and shall be binding upon Seller, the Purchasers
and the Agent.
Section 14.2 Notices. Except as provided in this Section 14.2, all
communications and notices provided for hereunder shall be in writing (including
bank wire, telecopy or electronic facsimile transmission or similar writing) and
shall be given to the other parties hereto at their respective addresses or
telecopy numbers set forth on the signature pages hereof or at such other
address or telecopy number as such Person may hereafter specify for the purpose
of notice to each of the other parties hereto. Each such notice or other
communication shall be effective (i) if given by telecopy, upon the receipt
thereof, (ii) if given by mail, three (3) Business Days after the time such
communication is deposited in the mail with first class postage prepaid or (iii)
if given by any other means, when received at the address specified in this
Section 14.2. Seller hereby authorizes the Agent to effect purchases and Tranche
Period and Discount Rate selections based on telephonic notices made by any
Person whom the Agent in good faith believes to be acting on behalf of Seller.
Seller agrees to deliver promptly to the Agent a written confirmation of each
telephonic notice signed by an authorized officer of Seller; provided, however,
the absence of such confirmation shall not affect the validity of such notice.
If the written confirmation differs from the action taken by the Agent, the
records of the Agent shall govern absent manifest error.
Section 14.3 Ratable Payments. If any Purchaser, whether by setoff or
otherwise, has payment made to it with respect to any portion of the Aggregate
Unpaids owing to such Purchaser (other than payments received pursuant to
Section 10.2 or 10.3) in a greater proportion than that received by any other
Purchaser entitled to receive a ratable share of such Aggregate Unpaids, such
Purchaser agrees, promptly upon demand, to purchase for cash without recourse or
warranty a portion of such Aggregate Unpaids held by the other Purchasers so
that after such purchase each Purchaser will hold its ratable proportion of such
Aggregate Unpaids; provided that if all or any portion of such excess amount is
thereafter recovered from such Purchaser, such purchase shall be rescinded and
the purchase price restored to the extent of such recovery, but without
interest.
Section 14.4 Protection of Ownership Interests of the Purchasers. (a)
(a) Seller agrees that from time to time, at its expense, it will promptly
execute and deliver all instruments and documents, and take all actions, that
may be necessary or desirable, or that the Agent may request, to perfect,
protect or more fully evidence the Purchaser Interests, or to enable the Agent
or the Purchasers to exercise and enforce their rights and remedies hereunder.
Without limiting the foregoing, Seller will, upon the request of the Agent, file
such financing or continuation statements, or amendments thereto or assignments
thereof, and execute and file such other instruments and documents, that may be
necessary or desirable, or that the Agent may reasonably request, to perfect,
protect or evidence such Purchaser Interests. At any time following the
occurrence of an Amortization Event, the Agent may, or the Agent may direct
Seller or the Servicer to, notify the Obligors of Receivables, at Seller's
expense, of the ownership or security interests of the Purchasers under this
Agreement and may also direct that payments of all amounts due or that become
due under any or all Receivables be made directly to the Agent or its designee.
Seller or the Servicer (as applicable) shall, at any Purchaser's request,
withhold the identity of such Purchaser in any such notification.
Page 38
(b) If any Seller Party fails to perform any of its
obligations hereunder, the Agent or any Purchaser may (but shall not be required
to) perform, or cause performance of, such obligations, and the Agent's or such
Purchaser's costs and expenses incurred in connection therewith shall be payable
by Seller as provided in Section 10.3. Each Seller Party irrevocably authorizes
the Agent at any time and from time to time in the sole discretion of the Agent,
and appoints the Agent as its attorney-in-fact, to act on behalf of such Seller
Party (i) to authorize on behalf of such Seller Party as debtor and to file
financing or continuation statements (and amendments thereto and assignments
thereof) necessary or desirable in the Agent's sole discretion to perfect and to
maintain the perfection and priority of the interest of the Purchasers in the
Receivables and (ii) to file a carbon, photographic or other reproduction of
this Agreement or any financing statement with respect to the Receivables as a
financing statement in such offices as the Agent in its sole discretion deems
necessary or desirable to perfect and to maintain the perfection and priority of
the interests of the Purchasers in the Receivables. This appointment is coupled
with an interest and is irrevocable. The authorization by each Seller Party set
forth in the second sentence of this Section 14.4(b) is intended to meet all
requirements for authorization by a debtor under Article 9 of any applicable
enactment of the UCC, including, without limitation, Section 9-509 thereof.
Section 14.5 Confidentiality. (a) (a) Each Seller Party and each
Purchaser (other than Company and Bank One) shall maintain and shall cause each
of its employees and officers to maintain the confidentiality of this Agreement
and the other confidential or proprietary information with respect to the Agent
and Company and their respective businesses obtained by it or them in connection
with the structuring, negotiating and execution of the transactions contemplated
herein, except that such Seller Party and such Purchaser and its officers and
employees may disclose such information to such Seller Party's and such
Purchaser's external accountants and attorneys (provided that each such Person
is informed of the confidential nature of such information) and as required by
any applicable law, rule, regulation (including, without limitation, the federal
securities laws and regulations), direction, request or order of any judicial,
administrative or regulatory authority or proceedings (whether or not having the
force or effect of law).
(b) Anything herein to the contrary notwithstanding, each
Seller Party hereby consents to the disclosure of any nonpublic information with
respect to it (i) to the Agent, the Financial Institutions or Company by each
other, (ii) by the Agent or the Purchasers to any prospective or actual assignee
or participant of any of them and (iii) by the Agent to any rating agency,
Commercial Paper dealer or provider of a surety, guaranty or credit or liquidity
enhancement to Company or any entity organized for the purpose of purchasing, or
making loans secured by, financial assets for which Bank One acts as the
administrative agent and to any officers, directors, employees, outside
accountants and attorneys of any of the foregoing, provided each such Person is
informed of the confidential nature of such information. In addition, the
Purchasers and the Agent may disclose any such nonpublic information pursuant to
any law, rule, regulation, direction, request or order of any judicial,
administrative or regulatory authority or proceedings (whether or not having the
force or effect of law).
Section 14.6 Bankruptcy Petition. Seller, the Servicer, the Agent and
each Financial Institution hereby covenants and agrees that, prior to the date
that is one year and one day after the payment in full of all outstanding senior
Indebtedness of Company, it will not institute
Page 39
against, or join any other Person in instituting against, Company or any such
entity any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceeding under the laws of the United States or
any state of the United States.
Section 14.7 Limitation of Liability. (a) (a) Except with respect to
any claim arising out of the willful misconduct or gross negligence of Company,
the Agent or any Financial Institution, no claim may be made by any Seller Party
or any other Person against Company, the Agent or any Financial Institution or
their respective Affiliates, directors, officers, employees, attorneys or agents
for any special, indirect, consequential or punitive damages in respect of any
claim for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement, or any act, omission
or event occurring in connection therewith; and each Seller Party hereby waives,
releases, and agrees not to xxx upon any claim for any such damages, whether or
not accrued and whether or not known or suspected to exist in its favor.
(b) Without limiting the provisions of Article X hereof and
except with respect to any claim arising out of the willful misconduct or gross
negligence of any Seller Party, no claim may be made by Company, the Agent or
any Financial Institution or any other Person against any Seller Party or their
respective Affiliates, directors, officers, employees, attorneys or agents for
any special, indirect, consequential or punitive damages in respect of any claim
for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement, or any act, omission
or event occurring in connection therewith; and Company, the Agent and each
Financial Institution hereby waives, releases, and agrees not to xxx upon any
claim for any such damages, whether or not accrued and whether or not known or
suspected to exist in its favor.
Section 14.8 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS.
Section 14.9 CONSENT TO JURISDICTION. EACH SELLER PARTY HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR ILLINOIS STATE COURT SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED
BY SUCH PERSON PURSUANT TO THIS AGREEMENT AND EACH SELLER PARTY HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY PURCHASER TO BRING
PROCEEDINGS AGAINST ANY SELLER PARTY IN THE COURTS OF ANY OTHER JURISDICTION.
ANY JUDICIAL PROCEEDING BY ANY SELLER PARTY AGAINST THE AGENT OR ANY PURCHASER
OR ANY AFFILIATE OF THE AGENT OR ANY PURCHASER INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
THIS AGREEMENT OR ANY DOCUMENT
Page 40
EXECUTED BY SUCH SELLER PARTY PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY
IN A COURT IN CHICAGO, ILLINOIS.
Section 14.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT
OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY ANY
SELLER PARTY PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED
HEREUNDER OR THEREUNDER.
Section 14.11 Integration; Binding Effect; Survival of Terms.
(a) This Agreement and each other Transaction Document contain
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.
(b) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns (including any trustee in bankruptcy). This Agreement shall create and
constitute the continuing obligations of the parties hereto in accordance with
its terms and shall remain in full force and effect until terminated in
accordance with its terms; provided, however, that the rights and remedies with
respect to (i) any breach of any representation and warranty made by any Seller
Party pursuant to Article V, (ii) the indemnification and payment provisions of
Article X, and Sections 14.5 and 14.6 shall be continuing and shall survive any
termination of this Agreement.
Section 14.12 Counterparts; Severability; Section References. This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which when taken together shall constitute one and
the same Agreement. 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. Unless otherwise expressly indicated, all references herein
to "Article," "Section," "Schedule" or "Exhibit" shall mean articles and
sections of, and schedules and exhibits to, this Agreement.
Section 14.13 Bank One Roles. Each of the Financial Institutions
acknowledges that Bank One acts, or may in the future act, (i) as administrative
agent for Company or any Financial Institution, (ii) as issuing and paying agent
for the Commercial Paper, (iii) to provide credit or liquidity enhancement for
the timely payment for the Commercial Paper and (iv) to provide other services
from time to time for Company or any Financial Institution (collectively, the
"Bank One Roles"). Without limiting the generality of this Section 14.13, each
Financial Institution hereby acknowledges and consents to any and all Bank One
Roles and agrees that in connection with any Bank One Role, Bank One may take,
or refrain from taking, any action that it, in its discretion, deems
appropriate, including, without limitation, in its role as administrative agent
for
Page 41
Company, and the giving of notice to the Agent of a mandatory purchase pursuant
to Section 13.1.
Section 14.14 Characterization. (a) (a) It is the intention of the
parties hereto that each purchase hereunder shall constitute and be treated as
an absolute and irrevocable sale, which purchase shall provide the applicable
Purchaser with the full benefits of ownership of the applicable Purchaser
Interest. Except as specifically provided in this Agreement, each sale of a
Purchaser Interest hereunder is made without recourse to Seller; provided,
however, that (i) Seller shall be liable to each Purchaser and the Agent for all
representations, warranties, covenants and indemnities made by Seller pursuant
to the terms of this Agreement, and (ii) such sale does not constitute and is
not intended to result in an assumption by any Purchaser or the Agent or any
assignee thereof of any obligation of Seller or Originator or any other person
arising in connection with the Receivables, the Related Security, or the related
Contracts, or any other obligations of Seller or Originator.
(b) In addition to any ownership interest which the Agent may
from time to time acquire pursuant hereto, Seller hereby grants to the Agent for
the ratable benefit of the Purchasers a valid and perfected security interest in
all of Seller's right, title and interest in, to and under all Receivables now
existing or hereafter arising, the Collections, each Lock-Box, each Collection
Account, all Related Security, all other rights and payments relating to such
Receivables, and all proceeds of any thereof prior to all other liens on and
security interests therein to secure the prompt and complete payment of the
Aggregate Unpaids. The Agent and the Purchasers shall have, in addition to the
rights and remedies that they may have under this Agreement, all other rights
and remedies provided to a secured creditor under the UCC and other applicable
law, which rights and remedies shall be cumulative.
[SIGNATURE PAGES FOLLOW]
Page 42
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their duly authorized officers as of
the date hereof.
COMDATA FUNDING CORPORATION
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Assistant Treasurer
Address: 0000 Xxxxxxxx Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
COMDATA NETWORK, INC.
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Executive Vice President, Finance
Address: 0000 Xxxxxxxx Xxx
Xxxxxxxxx, XX 00000
JUPITER SECURITIZATION CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Authorized Signer
Address: c/o Bank One, NA (Main Office
Chicago), as Agent
Asset Backed Finance
Suite IL1-0079, 1-19
1 Bank Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Fax: (000) 000-0000
BANK ONE, NA (MAIN OFFICE CHICAGO), as
a Financial Institution and as Agent
By:
Name: Xxxxxx X. Xxxxxx
Title: Director, Capital Markets
Address: Bank One, NA (Main Office Chicago)
Asset Backed Finance
Suite IL1-0596, 1-21
1 Bank Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Fax: (000) 000-0000
EXHIBIT I
DEFINITIONS
As used in this Agreement, the following terms shall have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined):
"Accrual Period" means each calendar month, provided that the
initial Accrual Period hereunder means the period from (and including) the date
of the initial purchase hereunder to (and including) the last day of the
calendar month thereafter.
"ACH Account" means the deposit account no. 1000846881
maintained at AmSouth Bank in Nashville, Tennessee in the name "Comdata Network,
Inc."
"Acquisition Amount" means, on the date of any purchase from
Company of one or more Purchaser Interests pursuant to Section 13.1, with
respect to each Financial Institution, the lesser of (i) such Financial
Institution's Pro Rata Share of the sum of (A) the lesser of (1) the Adjusted
Liquidity Price of each such Purchaser Interest and (2) the Capital of each such
Purchaser Interest and (B) all accrued and unpaid CP Costs for each such
Purchaser Interest and (ii) such Financial Institution's unused Commitment.
"Adjusted Funded Amount" means, in determining the Company
Transfer Price for any Purchaser Interest, an amount equal to the Adjusted
Liquidity Price of each such Purchaser Interest.
"Adjusted Liquidity Price" means an amount equal to:
PI [ DC + [ NDR ] ]
------
1 + ( .50 X .10 )
where:
PI = the undivided percentage interest evidenced
by such Purchaser Interest.
DC = the Deemed Collections.
NDR = the Outstanding Balance of all Receivables
other than Receivables as to which any
payment, or part thereof, remains unpaid for
61 days or more from the original due date
for such payment.
Each of the foregoing shall be determined from the most recent Settlement Report
received from the Servicer.
Exh. I-1
"Adverse Claim" means a lien, security interest, charge or
encumbrance, or other right or claim in, of or on any Person's assets or
properties in favor of any other Person.
"Affected Financial Institution" has the meaning specified in
Section 12.1(c).
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such Person or any Subsidiary of such Person. A
Person shall be deemed to control another Person if the controlling Person owns
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, by contract or otherwise.
"Agent" has the meaning set forth in the preamble to this
Agreement.
"Aggregate Capital" means, on any date of determination, the
aggregate amount of Capital of all Purchaser Interests outstanding on such date.
"Aggregate Reduction" has the meaning specified in Section
1.3.
"Aggregate Reserves" means, on any date of determination, the
sum of the Loss Reserve, the Dilution Reserve, and the Discount Reserve.
"Aggregate Unpaids" means, at any time, an amount equal to the
sum of all Aggregate Capital and all unpaid Obligations (whether due or accrued)
at such time.
"Agreement" means this Receivables Purchase Agreement, as it
may be amended or modified and in effect from time to time.
"Amortization Date" means the earliest to occur of (i) the day
on which any of the conditions precedent set forth in Section 6.2 are not
satisfied, (ii) the Business Day immediately prior to the occurrence of an
Amortization Event set forth in Section 9.1(d)(ii), (iii) the Business Day
specified in a written notice from the Agent following the occurrence of any
other Amortization Event and (iv) the date which is 30 Business Days after the
Agent's receipt of written notice from Seller that it wishes to terminate the
facility evidenced by this Agreement.
"Amortization Event" has the meaning specified in Article IX.
"Assignment Agreement" has the meaning set forth in Section
12.1(b).
"Authorization Payable Reserve Account" means the reserve
account related to "Express Check" undrafted codes authorized by any customer.
"Authorized Officer" means, with respect to any Person, its
president, corporate controller, treasurer or chief financial officer.
"Bank One" means Bank One, NA (Main Office Chicago) in its
individual capacity and its successors.
Exh. I-2
"Broken Funding Costs" means for any Purchaser Interest which:
(i) has its Capital reduced without compliance by Seller with the notice
requirements hereunder or (ii) does not become subject to an Aggregate Reduction
following the delivery of any Reduction Notice or (iii) is assigned under
Article XIII or terminated prior to the date on which it was originally
scheduled to end; an amount equal to the excess, if any, of (A) the CP Costs or
Yield (as applicable) that would have accrued during the remainder of the
Tranche Periods or the tranche periods for Commercial Paper determined by the
Agent to relate to such Purchaser Interest (as applicable) subsequent to the
date of such reduction, assignment or termination (or in respect of clause (ii)
above, the date such Aggregate Reduction was designated to occur pursuant to the
Reduction Notice) of the Capital of such Purchaser Interest if such reduction,
assignment or termination had not occurred or such Reduction Notice had not been
delivered, over (B) the sum of (x) to the extent all or a portion of such
Capital is allocated to another Purchaser Interest, the amount of CP Costs or
Yield actually accrued during the remainder of such period on such Capital for
the new Purchaser Interest, and (y) to the extent such Capital is not allocated
to another Purchaser Interest, the income, if any, actually received during the
remainder of such period by the holder of such Purchaser Interest from investing
the portion of such Capital not so allocated. In the event that the amount
referred to in clause (B) exceeds the amount referred to in clause (A), the
relevant Purchaser or Purchasers agree to pay to Seller the amount of such
excess. All Broken Funding Costs shall be due and payable hereunder upon demand.
"Business Day" means any day on which banks are not authorized
or required to close in New York, New York or Chicago, Illinois and The
Depository Trust Company of New York is open for business, and, if the
applicable Business Day relates to any computation or payment to be made with
respect to the LIBO Rate, any day on which dealings in dollar deposits are
carried on in the London interbank market.
"Capital" of any Purchaser Interest means, at any time, (A)
the Purchase Price of such Purchaser Interest, minus (B) the sum of the
aggregate amount of Collections and other payments received by the Agent which
in each case are applied to reduce such Capital in accordance with the terms and
conditions of this Agreement; provided that such Capital shall be restored (in
accordance with Section 2.5) in the amount of any Collections or other payments
so received and applied if at any time the distribution of such Collections or
payments are rescinded, returned or refunded for any reason.
"Capital Lease" means, as applied to any Person, any lease of
property by such Person as lessee that is classified as a capital lease under
GAAP.
"Ceridian" means Ceridian Corporation, formerly known as New
Ceridian Corporation, a Delaware corporation.
"Change of Control" means (i) any "person" or "group" (as such
terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934, but excluding any employee benefit plan of Performance Guarantor or
Originator, or any Person acting in its capacity as trustee, agent or other
fiduciary or administrator of any such plan), becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934,
except that a person shall be deemed to have "beneficial ownership" of all
securities that such person has the right to acquire (such rights, "option
rights"), whether such right is exercisable
Exh. I-3
immediately or only after the passage of time), directly or indirectly, of 30%
or more of the equity interests of Performance Guarantor or Originator on a
partially-diluted basis, taking into account equity interests realizable upon
the exercise of such person's or group's option rights or (ii) Originator shall
cease to own directly or indirectly 100% of the capital stock of Seller.
"Charged-Off Receivable" means a Receivable: (i) as to which
the Obligor thereof has taken any action, or suffered any event to occur, of the
type described in Section 9.1(d) (as if references to Seller Party therein refer
to such Obligor); (ii) as to which the Obligor thereof, if a natural person, is
deceased, (iii) which, consistent with the Credit and Collection Policy, would
be written off Seller's books as uncollectible, (iv) which has been identified
by Seller as uncollectible or (v) which has been transferred to Company 4 by the
Servicer.
"Collection Account" means each concentration account,
depositary account, lock-box account or similar account in which any Collections
are collected or deposited and which is listed on Exhibit IV.
"Collection Account Agreement" means an agreement
substantially in the form of Exhibit VI (or such other form as approved by the
Agent) among Originator, Seller, the Agent and a Collection Bank.
"Collection Bank" means, at any time, any of the banks holding
one or more Collection Accounts.
"Collection Notice" means a notice, in substantially the form
of Annex A to Exhibit VI (or such other form as approved by the Agent), from the
Agent to a Collection Bank.
"Collections" means, with respect to any Receivable, all cash
collections and other cash proceeds in respect of such Receivable, including,
without limitation, all yield, Finance Charges or other related amounts accruing
in respect thereof and all cash proceeds of Related Security with respect to
such Receivable.
"Collections to Sales Ratio" means, for a calendar month, a
percentage equal to (a) the current month's Collections as at the end of such
calendar month divided by (b) the current month's sales as at the end of such
calendar month.
"Comdata" means Comdata Network, Inc., a Maryland corporation.
"Commercial Paper" means promissory notes of Company issued by
Company in the commercial paper market.
"Commitment" means, for each Financial Institution, the
commitment of such Financial Institution to purchase Purchaser Interests from
(i) Seller and (ii) Company, in an amount not to exceed (i) in the aggregate,
the amount set forth opposite such Financial Institution's name on Schedule A to
this Agreement, as such amount may be modified in accordance with the terms
hereof (including, without limitation, any termination of Commitments pursuant
to Section 13.6 hereof) and (ii) with respect to any individual purchase
hereunder, its Pro Rata Share of the Purchase Price therefor.
Exh. I-4
"Commitment Availability" means at any time the positive
difference (if any) between (a) an amount equal to the aggregate amount of the
Commitments minus an amount equal to 2% of such aggregate Commitments at such
time minus (b) the Aggregate Capital at such time.
"Company" has the meaning set forth in the preamble to this
Agreement.
"Company 4" means the receivables aging accounting
classification for Receivables that are collected by escalated collection
efforts as a result of aging or suspension of the customer account.
"Company Residual" means the sum of the Company Transfer Price
Reductions.
"Company Transfer Price" means, with respect to the assignment
by Company of one or more Purchaser Interests to the Agent for the benefit of
one or more of the Financial Institutions pursuant to Section 13.1, the sum of
(i) the lesser of (a) the Capital of each such Purchaser Interest and (b) the
Adjusted Funded Amount of each such Purchaser Interest and (ii) all accrued and
unpaid CP Costs for each such Purchaser Interest.
"Company Transfer Price Deficit" has the meaning set forth in
Section 13.5.
"Company Transfer Price Reduction" means in connection with
the assignment of a Purchaser Interest by Company to the Agent for the benefit
of the Financial Institutions, the positive difference (if any) between (i) the
Capital of such Purchaser Interest and (ii) the Adjusted Funded Amount for such
Purchaser Interest.
"Concentration Limit" means, at any time, for any Obligor,
3.33% of the aggregate Outstanding Balance of Eligible Receivables, or such
other amount (a "Special Concentration Limit") for such Obligor designated by
the Agent; provided, that in the case of an Obligor and any Affiliate of such
Obligor, the Concentration Limit shall be calculated as if such Obligor and such
Affiliate are one Obligor; and provided, further, that Company or the Required
Financial Institutions may, upon not less than three Business Days' notice to
Seller, cancel any Special Concentration Limit.
"Contingent Obligation" of a Person means any agreement,
undertaking or arrangement by which such Person assumes, guarantees, endorses,
contingently agrees to purchase or provide funds for the payment of, or
otherwise becomes or is contingently liable upon, the obligation or liability of
any other Person, or agrees to maintain the net worth or 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, operating agreement, take-or-pay contract or application for a letter of
credit.
"Contract" means, with respect to any Receivable, any and all
invoices, statements of account balance or other writings (i) evidencing the
rights to receive payment of such Receivable (including the rights to receive
any finance charges, late fees or similar adjustments to such Receivable) or
(ii) necessary to enforce or collect the amounts owed pursuant to such
Receivable.
Exh. I-5
"Contractual Obligation" means, as to any Person, any
provision of any security issued by such Person or of any agreement, instrument
or other undertaking to which such Person is a party or by which it or any of
its property is bound.
"CP Costs" means, for each day, the sum of (i) discount or
yield accrued on Pooled Commercial Paper on such day, plus (ii) any and all
accrued commissions in respect of placement agents and Commercial Paper dealers,
and issuing and paying agent fees incurred, in respect of such Pooled Commercial
Paper for such day, plus (iii) other costs associated with funding small or
odd-lot amounts with respect to all receivable purchase facilities which are
funded by Pooled Commercial Paper for such day, minus (iv) any accrual of income
net of expenses received on such day from investment of collections received
under all receivable purchase facilities funded substantially with Pooled
Commercial Paper, minus (v) any payment received on such day net of expenses in
respect of Broken Funding Costs related to the prepayment of any Purchaser
Interest of Company pursuant to the terms of any receivable purchase facilities
funded substantially with Pooled Commercial Paper. In addition to the foregoing
costs, if Seller shall request any Incremental Purchase during any period of
time determined by the Agent in its sole discretion to result in incrementally
higher CP Costs applicable to such Incremental Purchase, the Capital associated
with any such Incremental Purchase shall, during such period, be deemed to be
funded by Company in a special pool (which may include capital associated with
other receivable purchase facilities) for purposes of determining such
additional CP Costs applicable only to such special pool and charged each day
during such period against such Capital.
"Credit and Collection Policy" means Seller's credit and
collection policies and practices relating to Receivables and related contracts
existing on the date hereof and attached hereto as Exhibit VIII hereto, as
modified from time to time in accordance with this Agreement.
"Deemed Collections" means the aggregate of all amounts Seller
shall have been deemed to have received as a Collection of a Receivable. Seller
shall be deemed to have received a Collection in full of a Receivable if at any
time (i) the Outstanding Balance of any such Receivable is either (x) reduced as
a result of any defective or rejected goods or services, any discount, rebate,
concession or any adjustment or otherwise by Seller (other than cash Collections
on account of the Receivables) 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 (ii) any of
the representations or warranties in Article V are no longer true with respect
to any Receivable.
"Default Fee" means with respect to any amount due and payable
by Seller in respect of any Aggregate Unpaids, an amount equal to the greater of
(i) $1000 and (ii) interest on any such unpaid Aggregate Unpaids at a rate per
annum equal to 2% above the Prime Rate.
"Defaulting Financial Institution" has the meaning set forth
in Section 13.5.
"Defaulted Receivable" means a Receivable as to which any
payment, or part thereof, remains unpaid for 61 days or more, but less than 90
days from the original due date for such payment.
Exh. I-6
"Delinquency Ratio" means, at any time, a percentage equal to
(i) the aggregate Outstanding Balance of all Receivables that were Delinquent
Receivables at such time divided by (ii) the aggregate Outstanding Balance of
all Receivables at such time, calculated on a three month rolling average basis.
"Delinquent Receivable" means a Receivable as to which any
payment, or part thereof, remains unpaid for 31 days or more from the original
due date for such payment.
"Delinquent Receivables Trigger Amount" means, as of August
30, 2002, the greater of (i)150% of the average of the Delinquency Ratios for
the six most recently ended calendar months or (ii) 125% of the highest one of
the Delinquency Ratios for the six most recently ended calendar months.
"Designated Obligor" means an Obligor indicated by the Agent
to Seller in writing.
"Dilution Ratio" means, as at the last day of any calendar
month, a percentage equal to (i) the aggregate amount of Dilutions which
occurred during such calendar month, divided by (ii) the aggregate sales which
occurred during the calendar month ending immediately prior to such calendar
month.
"Dilution Reserve" means, on any date, an amount equal to the
result of multiplying the Net Receivables Balance by the greater of (a) 1.0% and
(b) the following:
(2 X ED + ((DS-ED) X (DS/ED))) X DHR
where:
ED = the average of the Dilution Ratios for the
twelve most recently-ended complete calendar
months.
DS = the highest of the Dilution Ratios
occurring during the twelve most
recently-ended complete calendar months.
DHR = the result of dividing the aggregate
amount of all sales by all Originators which
have occurred during the two most
recently-ended complete calendar months by
the aggregate Outstanding Balance of all
Eligible Receivables as of the most recently
ended complete calendar month.
"Dilutions" means, at any time, the aggregate amount of
non-cash reductions or cancellations described in clause (i) of the definition
of "Deemed Collections" and any cash payments for the same.
"Discount Rate" means, the LIBO Rate or the Prime Rate, as
applicable, with respect to each Purchaser Interest of the Financial
Institutions.
Exh. I-7
"Discount Reserve" means, at any time, the Net Receivables
Balance multiplied by 2%.
"Eligible Receivable" means, at any time, a Receivable:
(i) the Obligor of which (a) if a natural person, is a
resident of the United States or, if a corporation or other business
organization, is organized under the laws of the United States or any political
subdivision thereof and has its chief executive office in the United States; (b)
is not an Affiliate of any of the parties hereto; (c) is not a Designated
Obligor; and (d) is not a government or a governmental subdivision or agency,
(ii) the Obligor of which is not the Obligor of any
Charged-Off Receivable,
(iii) which is not a Charged-Off Receivable or a Delinquent
Receivable,
(iv) which (a) by its terms is due and payable within 38 days
of the original billing date therefor and has not had its payment terms extended
or (b) by its terms is due and payable more than 38 but less than or equal to 68
days of the original billing date therefor and has not had its payment terms
extended and the Outstanding Balance of which, when combined with all other
Eligible Receivables that are due and payable more than 38 but less than or
equal to 68 days of the original billing date therefor, does not exceed an
amount equal to 1% of the Outstanding Balance of all Receivables,
(v) which is an "account" within the meaning of Article 9 of
the UCC of all applicable jurisdictions,
(vi) which is denominated and payable only in United States
dollars in the United States,
(vii) which arises under a contract in substantially the form
of one of the form contracts set forth on Exhibit IX hereto, in a form
originally submitted to Comdata by the customer thereunder or in a form
otherwise approved by the Agent in writing, which, together with such
Receivable, is in full force and effect and constitutes the legal, valid and
binding obligation of the related Obligor enforceable against such Obligor in
accordance with its terms subject to no offset, counterclaim or other defense,
(viii) [Intentionally Omitted]
(ix) which arises under a contract that contains an obligation
to pay a specified sum of money, contingent only upon the sale of goods or the
provision of services by Originator,
(x) which, together with the contract related thereto, does
not contravene any law, rule or regulation applicable thereto (including,
without limitation, any law, rule and regulation relating to truth in lending,
fair credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy) and with respect to which no part of the
contract related thereto is in violation of any such law, rule or regulation,
Ehx. I-8
(xi) which satisfies all applicable requirements of the Credit
and Collection Policy,
(xii) which was generated in the ordinary course of
Originator's business,
(xiii) which arises solely from the sale of goods or the
provision of services to the related Obligor by Originator, and not by any other
Person (in whole or in part),
(xiv) as to which the Agent has not notified Seller that the
Agent has determined that such Receivable or class of Receivables is not
acceptable as an Eligible Receivable, including, without limitation, because
such Receivable arises under a contract that is not acceptable to the Agent,
(xv) which is not subject to any right of rescission, set-off,
counterclaim, any other defense (including defenses arising out of violations of
usury laws) of the applicable Obligor against Originator or any other Adverse
Claim, and the Obligor thereon holds no right as against Originator to cause
Originator to repurchase the goods or merchandise the sale of which shall have
given rise to such Receivable (except with respect to sale discounts effected
pursuant to the Contract, or defective goods returned in accordance with the
terms of the Contract),
(xvi) as to which Originator has satisfied and fully performed
all obligations on its part with respect to such Receivable required to be
fulfilled by it, and no further action is required to be performed by any Person
with respect thereto other than payment thereon by the applicable Obligor,
(xvii) all right, title and interest to and in which has been
validly transferred by Originator directly to Seller under and in accordance
with the Receivables Sale Agreement, and Seller has good and marketable title
thereto free and clear of any Adverse Claim, and
(xviii) the Obligor of which is not the Obligor of Defaulted
Receivables the aggregate Outstanding Balance of which constitutes more than 25%
of the aggregate Outstanding Balance of all Receivables of such Obligor.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
"Facility Account" means Seller's Account No. 0000000 at Bank
One.
"Facility Termination Date" means the earliest of (i) June 24,
2005, (ii) the Liquidity Termination Date and (iii) the Amortization Date.
"Federal Bankruptcy Code" means Title 11 of the United States
Code entitled "Bankruptcy," as amended and any successor statute thereto.
"Federal Funds Effective Rate" means, for any period, a
fluctuating interest rate per annum for each day during such period equal to (a)
the weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the
Exh. I-9
preceding Business Day) by the Federal Reserve Bank of New York in the Composite
Closing Quotations for U.S. Government Securities; or (b) if such rate is not so
published for any day which is a Business Day, the average of the quotations at
approximately 10:30 a.m. (Chicago time) for such day on such transactions
received by the Agent from three federal funds brokers of recognized standing
selected by it.
"Fee Letter" means that certain letter agreement dated as of
the date hereof between Seller and the Agent, as it may be amended or modified
and in effect from time to time.
"Finance Charges" means, with respect to a Contract, any
finance, interest, late payment charges or similar charges owing by an Obligor
pursuant to such Contract.
"Financial Institutions" has the meaning set forth in the
preamble in this Agreement.
"Funding Agreement" means this Agreement and any agreement or
instrument executed by any Funding Source with or for the benefit of Company.
"Funding Source" means (i) any Financial Institution or (ii)
any insurance company, bank or other funding entity providing liquidity, credit
enhancement or back-up purchase support or facilities to Company.
"GAAP" means generally accepted accounting principles in
effect in the United States of America as of the date of this Agreement.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof, any agency, authority,
instrumentality, regulatory body, court, administrative tribunal, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.
"Incremental Purchase" means a purchase of one or more
Purchaser Interests which increases the total outstanding Aggregate Capital
hereunder.
"Indebtedness" of a Person means such Person's (i) obligations
for borrowed money, (ii) obligations representing the deferred purchase price of
property or services (other than accounts payable arising in the ordinary course
of such Person's business payable on terms customary in the trade), (iii)
obligations, whether or not assumed, secured by liens or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) capitalized lease obligations, (vi) net liabilities under
interest rate swap, exchange or cap agreements, (vii) Contingent Obligations and
(viii) liabilities in respect of unfunded vested benefits under plans covered by
Title IV of ERISA.
"Independent Director" shall mean a member of the Board of
Directors of Seller who is not at such time, and has not been at any time during
the preceding five (5) years, (A) a director, officer, employee or affiliate of
Seller, Originator, or any of their respective
Exh. I-10
Subsidiaries or Affiliates, or (B) the beneficial owner (at the time of such
individual's appointment as an Independent Director or at any time thereafter
while serving as an Independent Director) of any of the outstanding common
shares of Seller, Originator, or any of their respective Subsidiaries or
Affiliates, having general voting rights.
"Intended Characterization" means, for income tax purposes,
the characterization of the acquisition by the Purchasers of Purchaser Interests
under this Agreement as a loan or loans by the Purchasers to the Seller secured
by the Receivables, the Related Security, the Collection Accounts and the
Collections.
"Laws" means, collectively, all international, foreign,
Federal, state and local statutes, treaties, rules, guidelines, regulations,
ordinances, codes and administrative or judicial precedents or authorities,
including the interpretation or administration thereof by any Governmental
Authority charged with the enforcement, interpretation or administration
thereof, and all applicable administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any Governmental
Authority, in each case whether or not having the force of law.
"LIBO Rate" means the rate per annum equal to the sum of (i)
(a) the applicable British Bankers' Association Interest Settlement Rate for
deposits in U.S. dollars appearing on Reuters Screen LIBOROI as of 11:00 a.m.
(London time) two Business Days prior to the first day of the relevant Tranche
Period, and having a maturity equal to such Tranche Period, provided that, (i)
if Reuters Screen LIBOROI is not available to the Agent for any reason, the
applicable LIBO Rate for the relevant Tranche Period shall instead be the
applicable British Bankers' Association Interest Settlement Rate for deposits in
U.S. dollars as reported by any other generally recognized financial information
service as of 11:00 a.m. (London time) two Business Days prior to the first day
of such Tranche Period, and having a maturity equal to such Tranche Period, and
(ii) if no such British Bankers' Association Interest Settlement Rate is
available to the Agent, the applicable LIBO Rate for the relevant Tranche Period
shall instead be the rate determined by the Agent to be the rate at which Bank
One offers to place deposits in U.S. dollars with first-class banks in the
London interbank market at approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Tranche Period, in the approximate amount to
be funded at the LIBO Rate and having a maturity equal to such Tranche Period,
divided by (b) one minus the maximum aggregate reserve requirement (including
all basic, supplemental, marginal or other reserves) which is imposed against
the Agent in respect of Eurocurrency liabilities, as defined in Regulation D of
the Board of Governors of the Federal Reserve System as in effect from time to
time (expressed as a decimal), applicable to such Tranche Period plus (ii) 1.5%
per annum. The LIBO Rate shall be rounded, if necessary, to the next higher 1/16
of 1%.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing, and the filing of any financing statement under
the Uniform Commercial Code or comparable Laws of any jurisdiction), including
the interest of a purchaser of accounts receivable, but excluding the interest
of a lessor under an Operating Lease.
Exh. I-11
"Liquidity Termination Date" means June 23, 2003.
"Lock-Box" means each locked postal box with respect to which
a bank who has executed a Collection Account Agreement has been granted
exclusive access for the purpose of retrieving and processing payments made on
the Receivables and which is listed on Exhibit IV.
"Loss Percentage" means, for any Purchaser Interest on any
date, an amount equal to the greater of: (i) 2 times the Loss Ratio multiplied
by the Loss Horizon Ratio and (ii) 10%,
where:
Loss Ratio = As at the last day of any calendar month,
the highest three month rolling average
Default Ratio in the most recent twelve
months.
Default Ratio = As at the last day of any calendar month,
(x) the Outstanding Balance of all
Charged-Off Receivables plus Defaulted
Receivables as of such day , divided by (y)
the aggregate sales for the calendar month
occurring three months immediately prior to
such month.
Loss Horizon Ratio = As at the last day of any calendar month,
(x) the sum of the aggregate amount of
sales of the Originator for such calendar
month plus the aggregate amount of all sales
of the Originator for the month ended
immediately prior to such month, divided by
(y) the aggregate Outstanding Balance of all
Eligible Receivables as of such day.
"Loss Reserve" means, on any date, an amount equal to the Loss
Percentage multiplied by the Net Receivables Balance as of the close of business
of the Servicer on such date.
"Material Adverse Effect" means a material adverse effect on
(i) the financial condition or operations of any Seller Party and its
Subsidiaries, (ii) the ability of any Seller Party to perform its obligations
under this Agreement or the Performance Guarantor to perform its obligations
under the Performance Undertaking, (iii) the legality, validity or
enforceability of this Agreement or any other Transaction Document, (iv) any
Purchaser's interest in the Receivables generally or in any significant portion
of the Receivables, the Related Security or the Collections with respect
thereto, or (v) the collectibility of the Receivables generally or of any
material portion of the Receivables.
"Net Receivables Balance" means, at any time, the aggregate
Outstanding Balance of all Eligible Receivables at such time, reduced by (i) the
aggregate amount by which the Outstanding Balance of all Eligible Receivables of
each Obligor and its Affiliates exceeds the Concentration Limit for such
Obligor, (ii) the aggregate amount of deposits by Obligors which are designated
as security deposits, (iii) the amounts on deposit in the Authorization Payable
Reserve Account and (iv) the aggregate amount by which the then aggregate
Outstanding
Exh. I-12
Balance of all Eligible Receivables that are Unbilled Receivables exceeds 10% of
the aggregate Outstanding Balance of all Eligible Receivables.
"Non-Defaulting Financial Institution" has the meaning set
forth in Section 13.5.
"Non-Renewing Financial Institution" has the meaning set forth
in Section 13.6(a).
"Obligations" shall have the meaning set forth in Section 2.1.
"Obligor" means a Person obligated to make payments pursuant
to a Contract.
"Operating Lease" means, as applied to any Person, any lease
of property which is not a Capital Lease.
"Originator" means Comdata, in its capacity as seller under
the Receivables Sale Agreement.
"Outstanding Balance" of any Receivable at any time means the
then outstanding principal balance thereof.
"Participant" has the meaning set forth in Section 12.2.
"Performance Guarantor" means Ceridian.
"Performance Undertaking" means that certain Performance
Undertaking, dated as of June 24, 2002, by Performance Guarantor in favor of
Seller, substantially in the form of Exhibit XI, as the same may be amended,
restated or otherwise modified from time to time.
"Person" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"Pooled Commercial Paper" means Commercial Paper notes of
Company subject to any particular pooling arrangement by Company, but excluding
Commercial Paper issued by Company for a tenor and in an amount specifically
requested by any Person in connection with any agreement effected by Company.
"Potential Amortization Event" means an event which, with the
passage of time or the giving of notice, or both, would constitute an
Amortization Event.
"Prime Rate" means a rate per annum equal to the prime rate of
interest announced from time to time by Bank One or its parent (which is not
necessarily the lowest rate charged to any customer), changing when and as said
prime rate changes.
"Proposed Reduction Date" has the meaning set forth in Section
1.3.
"Pro Rata Share" means, for each Financial Institution, a
percentage equal to (i) the Commitment of such Financial Institution, divided by
(ii) the aggregate amount of all
Exh. I-13
Commitments of all Financial Institutions hereunder, adjusted as necessary to
give effect to the application of the terms of Sections 13.5 or 13.6.
"Purchase Limit" means $150,000,000.
"Purchase Notice" has the meaning set forth in Section 1.2.
"Purchase Price" means, with respect to any Incremental
Purchase of a Purchaser Interest, the amount paid to Seller for such Purchaser
Interest which shall not exceed the least of (i)the amount requested by Seller
in the applicable Purchase Notice, (ii)the unused portion of the Purchase Limit
on the applicable purchase date and (iii)the excess, if any, of the Net
Receivables Balance (less the Aggregate Reserves) on the applicable purchase
date over the aggregate outstanding amount of Aggregate Capital determined as of
the date of the most recent Settlement Report, taking into account such proposed
Incremental Purchase.
"Purchasers" means Company and each Financial Institution.
"Purchaser Interest" means, at any time, an undivided
percentage ownership interest (computed as set forth below) associated with a
designated amount of Capital, selected pursuant to the terms and conditions
hereof in (i) each Receivable arising prior to the time of the most recent
computation or recomputation of such undivided interest, (ii) all Related
Security with respect to each such Receivable, and (iii) all Collections with
respect to, and other proceeds of, each such Receivable. Each such undivided
percentage interest shall equal:
C
-----------------------
NRB -- AR
where:
C = the Capital of such Purchaser Interest.
AR = the Aggregate Reserves.
NRB = the Net Receivables Balance.
Such undivided percentage ownership interest shall be initially computed on its
date of purchase. Thereafter, until the Amortization Date, each Purchaser
Interest shall be automatically recomputed (or deemed to be recomputed) on each
day prior to the Amortization Date. The variable percentage represented by any
Purchaser Interest as computed (or deemed recomputed) as of the close of the
business day immediately preceding the Amortization Date shall remain constant
at all times thereafter.
"Purchasing Financial Institution" has the meaning set forth
in Section 12.1(b).
"Receivable" means all indebtedness and other obligations
arising in connection with the sale of goods or the rendering of services by
Originator and which are owed to Seller or Originator (at the time it arises,
and before giving effect to any transfer or conveyance under the Receivables
Sale Agreement or hereunder), or in which Seller or Originator has a security
Exh. I-14
interest or other interest, and are identified in the GEAC Accounting System as
having an account code beginning with "01000000000" followed by a two-alpha,
three numeric identification system (such account code identifying the
indebtedness or other obligation as belonging to the "Company 1" accounting
classification), including, without limitation, any such indebtedness,
obligation or interest constituting an account, chattel paper, instrument or
general intangible, whether billed or unbilled, and further includes, without
limitation, the obligation to pay any Finance Charges with respect thereto.
Indebtedness and other rights and obligations arising from any one transaction,
including, without limitation, indebtedness and other rights and obligations
represented by an individual invoice, shall constitute a Receivable separate
from a Receivable consisting of the indebtedness and other rights and
obligations arising from any other transaction; provided further, that any
indebtedness, rights or obligations referred to in the immediately preceding
sentence shall be a Receivable regardless of whether the account debtor or
Seller treats such indebtedness, rights or obligations as a separate payment
obligation.
"Receivables Sale Agreement" means that certain Receivables
Sale Agreement, dated as of June 24, 2002, between Originator and Seller, as the
same may be amended, restated or otherwise modified from time to time.
"Records" means, with respect to any Receivable, all Contracts
and all other documents, books, records and other information (including,
without limitation, computer programs, tapes, disks, punch cards, data
processing software and related property and rights) relating to the rights to
payment or enforcement of such Receivable, any Related Security therefor and the
related Obligor.
"Reduction Notice" has the meaning set forth in Section 1.3.
"Reduction Percentage" means, for any Purchaser Interest
acquired by the Financial Institutions from Company for less than the Capital of
such Purchaser Interest, a percentage equal to a fraction the numerator of which
is the Company Transfer Price Reduction for such Purchaser Interest and the
denominator of which is the Capital of such Purchaser Interest.
"Regulatory Change" has the meaning set forth in Section
10.2(a).
"Reinvestment" has the meaning set forth in Section 2.2.
"Related Security" means, with respect to any Receivable:
(i) all of Seller's interest in the inventory and
goods (including returned or repossessed inventory or goods), if any,
the sale, financing or lease of which by Seller gave rise to such
Receivable, and all insurance contracts with respect thereto,
(ii) all other security interests or liens and
property subject thereto from time to time, if any, purporting to
secure payment of such Receivable, whether pursuant to the Contract
related to such Receivable or otherwise, together with all financing
statements and security agreements describing any collateral securing
such Receivable,
Exh. I-15
(iii) all guaranties, letters of credit, insurance,
supporting obligations and other agreements or arrangements of whatever
character from time to time supporting or securing payment of such
Receivable whether pursuant to the Contract related to such Receivable
or otherwise,
(iv) all service contracts and other contracts and
agreements associated with such Receivable (excluding, however, any
such contract or agreement to the extent that it is not related to the
enforcement or collection of such Receivable or any other Related
Security),
(v) all Records related to such Receivable,
(vi) all of Seller's right, title and interest in, to
and under the Receivables Sale Agreement in respect of such Receivable
and all of Seller's right, title and interest in, to and under the
Performance Undertaking,
(vii) all of Seller's right, title and interest in
and to each Lock-Box and Collection Account, and
(viii) all proceeds of any of the foregoing;
excluding, however, in each of the foregoing cases, any Shared
Security.
"Required Financial Institutions" means, at any time,
Financial Institutions with Commitments in excess of 66-2/3% of the Purchase
Limit.
"Required Notice Period" means the number of days required
notice set forth below applicable to the Aggregate Reduction indicated below:
Aggregate Reduction Required Notice Period
*$100,000,000 two Business Days
$100,000,000 to $250,000,000 five Business Days
>$250,000,000 ten Business Days
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of
capital stock of Seller now or hereafter outstanding, except a dividend payable
solely in shares of that class of stock or in any junior class of stock of
Seller, (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of capital stock of Seller now or hereafter outstanding, (iii) any
payment or prepayment of principal of, premium, if any, or interest, fees or
other charges on or with respect to, and any redemption, purchase, retirement,
defeasance, sinking fund or similar payment and any claim for rescission with
respect to the Subordinated Loans (as defined in the Receivables Sale
Agreement), (iv) any payment made to redeem, purchase, repurchase or retire, or
to obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of capital stock of Seller now or hereafter
outstanding, and (v) any payment of management fees by Seller (except
Exh. I-16
for reasonable management fees to the Originator or its Affiliates in
reimbursement of actual management services performed).
"Seller" has the meaning set forth in the preamble to this
Agreement.
"Seller Parties" has the meaning set forth in the preamble to
this Agreement.
"Servicer" means at any time the Person (which may be the
Agent) then authorized pursuant to Article VIII to service, administer and
collect Receivables.
"Servicing Fee" has the meaning set forth in Section 8.6.
"Settlement Date" means (A) two Business Days following the
Settlement Report Date, and (B) the last day of the relevant Tranche Period in
respect of each Purchaser Interest of the Financial Institutions.
"Settlement Period" means (A) in respect of each Purchaser
Interest of Company, the immediately preceding Accrual Period, and (B) in
respect of each Purchaser Interest of the Financial Institutions, the entire
Tranche Period of such Purchaser Interest.
"Settlement Report" means a report, in substantially the form
of Exhibit X hereto (appropriately completed), furnished by the Servicer to the
Agent pursuant to Section 8.5.
"Settlement Report Date" shall mean the 18th day of any
calendar month or, if such day is not a Business Day, the next succeeding
Business Day.
"Shared Security" means (i) all security interests or liens
and property subject thereto from time to time, if any, purporting to secure
both payment of Receivables owned by Seller and payment of other indebtedness
owed to Originator, whether pursuant to the contract related to such
indebtedness or otherwise, together with all financing statements and security
agreements describing any collateral securing such indebtedness and (ii) all
guaranties, letters of credit, insurance, supporting obligations and other
agreements or arrangements of whatever character from time to time supporting or
securing both payment of Receivables owned by Seller and payment of any other
indebtedness owed to Originator, whether pursuant to the contract related to
such indebtedness or otherwise.
"Specified Potential Amortization Event" means an event which,
with the passage of time or the giving of notice, or both, would constitute an
Amortization Event (other than an Amortization Event described in Section9.1(a)
or 9.1(h)).
"Subsidiary" of a Person means (i) any corporation more than
50% of the outstanding securities having ordinary voting power of which shall at
the time be owned or controlled, directly or indirectly, by such Person or by
one or more of its Subsidiaries or by such Person and one or more of its
Subsidiaries, or (ii) any partnership, association, limited liability company,
joint venture or similar business organization more than 50% of the ownership
interests having ordinary voting power of which shall at the time be so owned or
controlled. Unless otherwise expressly provided, all references herein to a
"Subsidiary" shall mean a Subsidiary of Seller.
Exh. I-17
"Termination Date" has the meaning set forth in Section 2.2.
"Termination Percentage" has the meaning set forth in Section
2.2.
"Terminating Financial Institution" has the meaning set forth
in Section 13.6(a).
"Terminating Tranche" has the meaning set forth in Section
4.3(b).
"Tranche Period" means, with respect to any Purchaser Interest
held by a Financial Institution:
(a) if Yield for such Purchaser Interest is
calculated on the basis of the LIBO Rate, a period of one, two, three
or six months, or such other period as may be mutually agreeable to the
Agent and Seller, commencing on a Business Day selected by Seller or
the Agent pursuant to this Agreement. Such Tranche Period shall end on
the day in the applicable succeeding calendar month which corresponds
numerically to the beginning day of such Tranche Period, provided,
however, that if there is no such numerically corresponding day in such
succeeding month, such Tranche Period shall end on the last Business
Day of such succeeding month; or
(b) if Yield for such Purchaser Interest is
calculated on the basis of the Prime Rate, a period commencing on a
Business Day selected by Seller and agreed to by the Agent, provided no
such period shall exceed one month.
If any Tranche Period would end on a day which is not a Business Day, such
Tranche Period shall end on the next succeeding Business Day, provided, however,
that in the case of Tranche Periods corresponding to the LIBO Rate, if such next
succeeding Business Day falls in a new month, such Tranche Period shall end on
the immediately preceding Business Day. In the case of any Tranche Period for
any Purchaser Interest which commences before the Amortization Date and would
otherwise end on a date occurring after the Amortization Date, such Tranche
Period shall end on the Amortization Date. The duration of each Tranche Period
which commences after the Amortization Date shall be of such duration as
selected by the Agent.
"Transaction Documents" means, collectively, this Agreement,
each Purchase Notice, the Receivables Sale Agreement, each Collection Account
Agreement, the Performance Undertaking, the Fee Letter, the Subordinated Note
(as defined in the Receivables Sale Agreement) and all other instruments,
documents and agreements executed and delivered in connection herewith
"UCC" means the Uniform Commercial Code as from time to time
in effect in the specified jurisdiction.
"Unbilled Receivable" means a Receivable which has not been
invoiced but for which the associated service has been performed or good has
been provided.
"Yield" means for each respective Tranche Period relating to
Purchaser Interests of the Financial Institutions, an amount equal to the
product of the applicable Discount Rate for
Exh. I-18
each Purchaser Interest multiplied by the Capital of such Purchaser Interest for
each day elapsed during such Tranche Period, annualized on a 360 day basis.
All accounting terms not specifically defined herein shall be
construed in accordance with GAAP. All terms used in Article 9 of the UCC in the
State of Illinois, and not specifically defined herein, are used herein as
defined in such Article 9.
Exh. I-19
EXHIBIT II
FORM OF PURCHASE NOTICE
[Date]
Bank One, NA (Main Office Chicago), as Agent
1 Bank One Plaza, 21st Floor
Asset-Backed Finance
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: [Xxx Xxxxxx]
Re: PURCHASE NOTICE
Ladies and Gentlemen:
Reference is hereby made to the Receivables Purchase
Agreement, dated as of June 24, 2002, by and among Comdata Funding Corporation,
a Delaware corporation (the "Seller"), Comdata Network, Inc., as Servicer, the
Financial Institutions, Jupiter Securitization Corporation ("Company"), and Bank
One, NA (Main Office Chicago), as Agent (the "Receivables Purchase Agreement").
Capitalized terms used herein shall have the meanings assigned to such terms in
the Receivables Purchase Agreement.
The Agent is hereby notified of the following Incremental
Purchase:
--------------------------------- ----------------------------------------------
Purchase Price: $
---------------------------------------------
--------------------------------- ----------------------------------------------
Date of Purchase:
----------------------------------------------
--------------------------------- ----------------------------------------------
Requested Discount Rate: [LIBO Rate] [Prime Rate] [Pooled Commercial
Paper rate]
--------------------------------- ----------------------------------------------
Please credit the Purchase Price in immediately available
funds to our Facility Account [and then wire-transfer the Purchase Price in
immediately available funds on the above-specified date of purchase to]:
[Account Name]
[Account No.]
[Bank Name & Address]
[ABA #]
Reference:
Telephone advice to: [Name] @ tel. No. ( )
Please advise [Name] at telephone no ( ) _________________ if
Company will not be making this purchase.
Exh. II-1
In connection with the Incremental Purchase to be made on the
above listed "Date of Purchase" (the "Purchase Date"), the Seller hereby
certifies that the following statements are true on the date hereof, and will be
true on the Purchase Date (before and after giving effect to the proposed
Incremental Purchase):
(i) the representations and warranties of the Seller set forth
in Section 5.1 of the Receivables Purchase Agreement are true and correct on and
as of the Purchase Date as though made on and as of such date;
(ii) no event has occurred and is continuing, or would result
from the proposed Incremental Purchase, that will constitute an Amortization
Event or a Potential Amortization Event;
(iii) the Facility Termination Date has not occurred, the
Aggregate Capital does not exceed the Purchase Limit and the aggregate Purchaser
Interests do not exceed 100%; and
(iv) the amount of Aggregate Capital is $_________ after
giving effect to the Incremental Purchase to be made on the Purchase Date.
Very truly yours,
COMDATA FUNDING CORPORATION
By:
--------------------------------------------
Name:
Title:
Exh. II-2
EXHIBIT III
PLACES OF BUSINESS, JURISDICTIONS OF ORGANIZATION AND
CHIEF EXECUTIVE OFFICES; LOCATIONS OF RECORDS; ORGANIZATIONAL
NUMBER(S); FEDERAL EMPLOYER IDENTIFICATION NUMBER(S); OTHER NAMES
SERVICER:
Principal Place of Business: 0000 Xxxxxxxx Xxx
Xxxxxxxxx, XX 00000
Jurisdiction of Organization: Maryland
Chief Executive Office: 0000 Xxxxxxxx Xxx
Xxxxxxxxx, XX 00000
Location of Records: 0000 Xxxxxxxx Xxx
Xxxxxxxxx, XX 00000
Organizational Number: D00563916
Federal Employer Identification Number: 00-0000000
Other Names and Trade Names: Archco, Inc. and International
Automated Energy Systems, Inc.
were merged into Comdata
Network, Inc.
Trade names include Comdata,
Comchek, Comchek eCash, Comdata
Network, Comdata Corporation,
Comdata Transceiver, Comdata
Financial Services, Comdata
Merchant Services, Comdata
Payment Services, Comdata
Transportation Services, Comdata
Transportation Group, Trendar,
Trendar Corporation,
Transceiver, NTS, Comdata
Complete, Comdata Gaming
Services, Comdata
Telecommunications Services,
Comdata Telecommunications
Services, Inc., Comdata Network,
Inc. of California, Stored Value
Systems, Inc.
SELLER:
Principal Place of Business: 0000 Xxxxxxxx Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Jurisdiction of Organization: Delaware
Chief Executive Office: 0000 Xxxxxxxx Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Exh. III-1
Location(s) of Records: 0000 Xxxxxxxx Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Organizational Number: 3526500
Federal Employer Identification Number: 00-0000000
Other Names: None
Exh. III-2
EXHIBIT IV
NAMES OF COLLECTION BANKS; COLLECTION ACCOUNTS
------------------------ -------------------------------------- --------------------------
Bank Lock Box Address Related Collection Bank Lock
Account
------------------------ -------------------------------------- --------------------------
Bank of America, P.O. Box 100647 Account No. 003250355791
Atlanta, GA Xxxxxxx, XX 00000-0000
ABA No. 000000000
------------------------ -------------------------------------- --------------------------
Bank of America, P.O. Box 500544 Account No. 100101204865
Xx. Xxxxx, XX Xx. Xxxxx, XX 00000-0000
ABA No. 000000000
------------------------ -------------------------------------- --------------------------
Bank of America, P.O. Box 845738 Account No. 001252888157
Dallas, TX Xxxxxx, XX 00000-0000
ABA No. 000000000
------------------------ -------------------------------------- --------------------------
Mellon Bank, P.O. Box 360239 Account No. 131-1759
Pittsburgh, PA Xxxxxxxxxx, XX 00000-0000
ABA No. 000000000
------------------------ -------------------------------------- --------------------------
AmSouth Bank, None - account for deposits of Account No. 1000851850
Nashville, TN checks received at corporate office
ABA No. 000000000 in Brentwood, TN
------------------------ -------------------------------------- --------------------------
Bank of America, None - wire transfer receipt account Account Xx. 000000000000
Xx. Xxxxx, XX
ABA No. 000000000
------------------------ -------------------------------------- --------------------------
Exh. IV-1
EXHIBIT V
FORM OF COMPLIANCE CERTIFICATE
To: Bank One, NA (Main Office Chicago), as Agent
This Compliance Certificate is furnished pursuant to that
certain Receivables Purchase Agreement dated as of June24, 2002 among Comdata
Funding Corporation (the "Seller"), Comdata Network, Inc. (the "Servicer"), the
Purchasers party thereto and Bank One, NA (Main Office Chicago), as agent for
such Purchasers (as the same may be amended, supplemented, restated or otherwise
modified from time to time, the "Agreement"). Capitalized terms used and not
otherwise defined herein are used with the meanings attributed thereto in the
Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ___________________ of [Insert name
of applicable Seller Party] (the "Applicable Party").
2. I have reviewed the terms of the Agreement and I have made,
or have caused to be made under my supervision, a detailed review of the
transactions and conditions of the Applicable Party and its Subsidiaries during
the [accounting period covered by the attached financial statements]
[[quarterly][annual] period ending on ____________].
3. The examinations described in paragraph 2 did not disclose,
and I have no knowledge of, the existence of any condition or event which
constitutes an Amortization Event or Potential Amortization Event during or at
the end of the [accounting period covered by the attached financial statements]
[[quarterly][annual] period ending on ___________] or as of the date of this
Certificate, except as set forth in paragraph 5 below.
[4. Schedule I attached hereto sets forth financial data and
computations evidencing the compliance with certain covenants of the Agreement,
all of which data and computations are true, complete and correct.]
5. Described below are the exceptions, if any, to paragraph 3
by listing, in detail, the nature of the condition or event, the period during
which it has existed and the action which the Applicable Party has taken, is
taking, or proposes to take with respect to each such condition or event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Exh. V-1
6. As of the date hereof, the jurisdiction of organization of
Seller is Delaware, the jurisdiction of organization of the Servicer is
Maryland, each of the Seller and the Servicer is a "registered organization"
(within the meaning of Section 9-102 of the UCC in effect in Delaware or
Maryland, as applicable) and neither Seller nor any Servicer has changed its
jurisdiction of organization since the date of the Agreement.
The foregoing certifications[, together with the computations
set forth in Schedule I hereto and the financial statements delivered with this
Certificate in support hereof,] are made and delivered this day of , _____.
[INSERT NAME OF APPLICABLE SELLER PARTY]
By:
Name:
Title:
Exh. V-2
SCHEDULE I TO COMPLIANCE CERTIFICATE
A. Schedule of Compliance as of __________, ____ with Section 9.1 of the
Agreement. Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the
Agreement.
This schedule relates to the month ended:
Exh. V-3
EXHIBIT VI
FORM OF COLLECTION ACCOUNT AGREEMENT
[On letterhead of Comdata Network, Inc.]
[ ], 2002
[Lock-Box Bank/Concentration Bank/Depositary Bank]
Re: Comdata Network, Inc.
Ladies and Gentlemen:
Reference is hereby made to P.O. Box #[ ] in [city, state, zip
code] (the "Lock-Box") of which you have exclusive control for the purpose of
receiving mail and processing payments therefrom pursuant to that certain [name
of lock-box agreement] between you and Comdata Network, Inc. (the "Company")
dated [ ] (the "Agreement"). You hereby confirm your agreement to perform the
services described therein. Among the services you have agreed to perform
therein, is to endorse all checks and other evidences of payment, and credit
such payments to the Company's checking account no. [ ] maintained with you in
the name of the Company (the "Lock-Box Account").
The Company hereby informs you that pursuant to that certain
Receivables Sale Agreement, dated as of June24, 2002, among the Company, the
other parties thereto as Originators and Comdata Funding Corporation (the
"Seller"), the Company has transferred all of its right, title and interest in
and to, and exclusive ownership and control of, the Lock-Box and the Lock-Box
Account to Seller. Seller has granted a security interest in the Lock-Box and
the Lock-Box Account to Bank One (as defined below), as agent. The Company and
Seller hereby request that the name of the Lock-Box Account be changed to
"Comdata Network, Inc., as Servicer."
The Company and Seller hereby irrevocably instruct you, and
you hereby agree, that (i) if at any time you receive any instruction originated
by Bank One, NA (Main Office Chicago) ("Bank One") directing the disposition of
funds in the Lock-Box Account you will comply with such instruction without
further consent of the Company, Seller or any other party, provided, that until
you receive notice in the form attached hereto as Annex A (a "Default Notice")
from Bank One, Seller and the Company, as servicer, shall be entitled to give
instructions directing the disposition of funds in the Lock-Box Account; and
(ii) upon receiving the Default Notice, (A) you will take all instructions
regarding the Lock-Box Account and the disposition of funds therein solely from
Bank One, (B) the name of the Lock-Box Account will be changed to Bank One for
itself and as agent (or any designee of Bank One) and Bank One
Exh. VI-1
e exclusive ownership of and access to and sole control of the Lock-Box
and the Lock-Box Account, and neither the Company, Seller, nor any of their
respective affiliates will have any control of the Lock-Box or the Lock-Box
Account or any access thereto, (C) you will either continue to send the funds
from the Lock-Box to the Lock-Box Account, or will redirect the funds as Bank
One may otherwise request, (D) you will transfer monies on deposit in the
Lock-Box Account, at any time, as directed by Bank One, (E) all services to be
performed by you under the Agreement will be performed on behalf of Bank One,
and (F) all correspondence or other mail that you have agreed to send to the
Company or Seller will be sent to Bank One at the following address:
Bank One, NA (Main Office Chicago), as Agent
Suite ______, 00xx Xxxxx
0 Xxxx Xxx Xxxxx
Xxxxxxx, Xxxxxxxx 60670-______
Attention: Credit Manager, Asset Backed
Securities Division
Moreover, upon such notice, Bank One for itself and as agent
will have all rights and remedies given to the Company (and Seller, as the
Company's assignee) under the Agreement. Seller agrees, however, to continue to
pay all fees and other assessments due thereunder at any time.
You hereby acknowledge that monies deposited in the Lock-Box
Account, the Lock-Box Account and any other account established with you by Bank
One for the purpose of receiving funds from the Lock-Box are subject to the
liens of Bank One for itself and as agent, and will not be subject to deduction,
set-off, banker's lien or any other right you or any other party may have
against the Company or Seller (including, without limitation, any security
interest therein arising by operation of law or otherwise, which security
interest is hereby released).
You hereby acknowledge and agree that (i) you are executing
this letter agreement and agree to perform hereunder in your capacity as a
"bank" as defined in Section 9-102 of the UCC; (ii) the Lock-Box Account is a
"Deposit Account" as defined in Section 9-102(a)(29) of the UCC; (iii)
regardless of any provision in any other agreement, for purposes of the UCC,
Illinois shall be deemed to be your jurisdiction (with the meaning of Section
9-304 of the UCC); (iv) you have not entered into, and until termination of this
letter agreement will not enter into, any agreement with any other party
relating to the Lock-Box Account and/or any financial assets credited thereto
pursuant to which you have agreed to comply with instructions (within the
meaning of Section 9-104 of the UCC) of such other party; (v) except for the
claims and interest of Bank One and Seller in the Lock-Box Account, you do not
know of any lien on or claim to, or interest in the Lock-Box Account; and (vi)
if any party asserts any lien, encumbrance or similar process against the
Lock-Box Account, you will promptly notify Bank One and Seller thereof. All
references herein to the "UCC" shall mean the Uniform Commercial Code as in
effect from time to time in the State of Illinois.
THIS LETTER AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER WILL BE GOVERNED BY AND CONSTRUED AND
Exh. VI-2
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS. This letter
agreement may be executed in any number of counterparts and all of such
counterparts taken together will be deemed to constitute one and the same
instrument.
This letter agreement contains the entire agreement between
the parties, and may not be altered, modified, terminated or amended in any
respect, nor may any right, power or privilege of any party hereunder be waived
or released or discharged, except upon execution by all parties hereto of a
written instrument so providing. In the event that any provision in this letter
agreement is in conflict with, or inconsistent with, any provision of the
Agreement, this letter agreement will exclusively govern and control. Each party
agrees to take all actions reasonably requested by any other party to carry out
the purposes of this letter agreement or to preserve and protect the rights of
each party hereunder.
Exh. VI-3
Please indicate your agreement to the terms of this letter
agreement by signing in the space provided below. This letter agreement will
become effective immediately upon execution of a counterpart of this letter
agreement by all parties hereto.
Very truly yours,
COMDATA NETWORK, INC.
By:
----------------------------------------
Name:
Title:
COMDATA FUNDING CORPORATION
By:
----------------------------------------
Name:
Title:
Acknowledged and agreed to
this ______ day of _________, 2002
[COLLECTION BANK]
By:
------------------------------------------
Name:
Title:
BANK ONE, NA (MAIN OFFICE CHICAGO), as Agent
By:
------------------------------------------
Name:
Title:
Exh. VI-4
ANNEX A
FORM OF NOTICE
[On letterhead of Bank One]
-----------------------,---------
[Collection Bank/Depositary Bank/Concentration Bank]
Re: Comdata Network, Inc.
Ladies and Gentlemen:
We hereby notify you that we are exercising our rights pursuant to that
certain letter agreement among Comdata Network, Inc., Comdata Funding
Corporation, you and us, to have the name of, and to have exclusive ownership
and sole control of, account number ______________ (the "Lock-Box Account")
maintained with you. You are hereby instructed not to accept any direction,
instructions or entitlement orders with respect to the Lock-Box Account or the
funds credited thereto from any person or entity other than the Agent, unless
otherwise ordered by a court of competent jurisdiction. [Lock-Box Account will
henceforth be a zero-balance account, and funds deposited in the Lock-Box
Account should be sent at the end of each day to _______________.] You have
further agreed to perform all other services you are performing under that
certain agreement dated __________ between you and Comdata Network, Inc. on our
behalf.
We appreciate your cooperation in this matter.
Very truly yours,
BANK ONE, NA (MAIN OFFICE CHICAGO)
(for itself and as agent)
By:
-------------------------------------
Title:
----------------------------------
Annex A-1
EXHIBIT VII
FORM OF ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT (this "Assignment Agreement") is
entered into as of the ___ day of ____________, ____, by and between
_____________________ ("Assignor") and __________________ ("Assignee").
PRELIMINARY STATEMENTS
A. This Assignment Agreement is being executed and delivered
in accordance with Section 12.1(b) of that certain Receivables Purchase
Agreement dated as of June24, 2002 by and among Comdata Funding Corporation,
Comdata Network, Inc., as servicer, Jupiter Securitization Corporation, Bank
One, NA (Main Office Chicago), as Agent, and the Financial Institutions party
thereto (as amended, modified or restated from time to time, the "Purchase
Agreement"). Capitalized terms used and not otherwise defined herein are used
with the meanings set forth or incorporated by reference in the Purchase
Agreement.
B. Assignor is a Financial Institution party to the Purchase
Agreement, and Assignee wishes to become a Financial Institution thereunder; and
C. Assignor is selling and assigning to Assignee an undivided
____________% (the "Transferred Percentage") interest in all of Assignor's
rights and obligations under the Purchase Agreement and the Transaction
Documents, including, without limitation, Assignor's Commitment and (if
applicable) the Capital of Assignor's Purchaser Interests as set forth herein.
AGREEMENT
The parties hereto hereby agree as follows:
1. The sale, transfer and assignment effected by this
Assignment Agreement shall become effective (the "Effective Date") two (2)
Business Days (or such other date selected by the Agent in its sole discretion)
following the date on which a notice substantially in the form of Schedule II to
this Assignment Agreement ("Effective Notice") is delivered by the Agent to
Company, Assignor and Assignee. From and after the Effective Date, Assignee
shall be a Financial Institution party to the Purchase Agreement for all
purposes thereof as if Assignee were an original party thereto and Assignee
agrees to be bound by all of the terms and provisions contained therein.
2. If Assignor has no outstanding Capital under the Purchase
Agreement, on the Effective Date, Assignor shall be deemed to have hereby
transferred and assigned to Assignee, without recourse, representation or
warranty (except as provided in paragraph 6 below), and the Assignee shall be
deemed to have hereby irrevocably taken, received and assumed from Assignor, the
Transferred Percentage of Assignor's Commitment and all rights and obligations
associated therewith under the terms of the Purchase Agreement, including,
Exh. VII-1
without limitation, the Transferred Percentage of Assignor's future funding
obligations under Section 4.1 of the Purchase Agreement.
3. If Assignor has any outstanding Capital under the Purchase
Agreement, at or before 12:00 noon, local time of Assignor, on the Effective
Date Assignee shall pay to Assignor, in immediately available funds, an amount
equal to the sum of (i) the Transferred Percentage of the outstanding Capital of
Assignor's Purchaser Interests (such amount, being hereinafter referred to as
the "Assignee's Capital"); (ii) all accrued but unpaid (whether or not then due)
Yield attributable to Assignee's Capital; and (iii) accruing but unpaid fees and
other costs and expenses payable in respect of Assignee's Capital for the period
commencing upon each date such unpaid amounts commence accruing, to and
including the Effective Date (the "Assignee's Acquisition Cost"); whereupon,
Assignor shall be deemed to have sold, transferred and assigned to Assignee,
without recourse, representation or warranty (except as provided in paragraph 6
below), and Assignee shall be deemed to have hereby irrevocably taken, received
and assumed from Assignor, the Transferred Percentage of Assignor's Commitment
and the Capital of Assignor's Purchaser Interests (if applicable) and all
related rights and obligations under the Purchase Agreement and the Transaction
Documents, including, without limitation, the Transferred Percentage of
Assignor's future funding obligations under Section 4.1 of the Purchase
Agreement.
4. Concurrently with the execution and delivery hereof,
Assignor will provide to Assignee copies of all documents requested by Assignee
which were delivered to Assignor pursuant to the Purchase Agreement.
5. Each of the parties to this Assignment Agreement agrees
that at any time and from time to time upon the written request of any other
party, it will execute and deliver such further documents and do such further
acts and things as such other party may reasonably request in order to effect
the purposes of this Assignment Agreement.
6. By executing and delivering this Assignment Agreement,
Assignor and Assignee confirm to and agree with each other, the Agent and the
Financial Institutions as follows: (a) other than the representation and
warranty that it has not created any Adverse Claim upon any interest being
transferred hereunder, Assignor makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or representations
made by any other Person in or in connection with the Purchase Agreement or the
Transaction Documents or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of Assignee, the Purchase Agreement or any
other instrument or document furnished pursuant thereto or the perfection,
priority, condition, value or sufficiency of any collateral; (b) Assignor makes
no representation or warranty and assumes no responsibility with respect to the
financial condition of the Seller, any Obligor, any Seller Affiliate or the
performance or observance by the Seller, any Obligor, any Seller Affiliate of
any of their respective obligations under the Transaction Documents or any other
instrument or document furnished pursuant thereto or in connection therewith;
(c) Assignee confirms that it has received a copy of the Purchase Agreement and
copies of such other Transaction Documents, and other documents and information
as it has requested and deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement; (d) Assignee will,
independently and without reliance upon the Agent, Company, the Seller or any
other Financial Institution or Purchaser and based on such
Exh. VII-2
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Purchase
Agreement and the Transaction Documents; (e) Assignee appoints and authorizes
the Agent to take such action as agent on its behalf and to exercise such powers
under the Transaction Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto; and (f)
Assignee agrees that it will perform in accordance with their terms all of the
obligations which, by the terms of the Purchase Agreement and the other
Transaction Documents, are required to be performed by it as a Financial
Institution or, when applicable, as a Purchaser.
7. Each party hereto represents and warrants to and agrees
with the Agent that it is aware of and will comply with the provisions of the
Purchase Agreement, including, without limitation, Sections 1.1, 4.1, 13.1 and
14.6 thereof.
8. Schedule I hereto sets forth the revised Commitment of
Assignor and the Commitment of Assignee, as well as administrative information
with respect to Assignee.
9. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS.
10. Assignee hereby covenants and agrees that, prior to the
date which is one year and one day after the payment in full of all senior
indebtedness for borrowed money of Company, it will not institute against, or
join any other Person in instituting against, Company or any such entity any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other similar proceeding under the laws of the United States or any state of
the United States.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment Agreement to be executed by their respective duly authorized officers
of the date hereof.
[ASSIGNOR]
By:
---------------------------------
Title:
[ASSIGNEE]
By:
---------------------------------
Title:
Exh. VII-3
SCHEDULE I TO ASSIGNMENT AGREEMENT
LIST OF LENDING OFFICES, ADDRESSES
FOR NOTICES AND COMMITMENT AMOUNTS
Date: _______________, ____
Transferred Percentage: ________%
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
X-0 X-0 X-0 X-0
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Assignor Commitment (prior to Commitment (after Outstanding Capital Ratable Share of
giving effect to the giving effect to the (if any) Outstanding Capital
Assignment Agreement) Assignment Agreement)
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
X-0 X-0 X-0
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Assignee Commitment (after Outstanding Capital Ratable Share of
giving effect to the (if any) Outstanding Capital
Assignment Agreement)
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
ADDRESS FOR NOTICES
----------------------------------------
----------------------------------------
Attention:
Phone:
Fax:
Exh. VII-4
SCHEDULE II TO ASSIGNMENT AGREEMENT
EFFECTIVE NOTICE
TO: ________________________, Assignor
_______________________________
_______________________________
_______________________________
TO: ________________________, Assignee
_______________________________
_______________________________
_______________________________
The undersigned, as Agent under the Receivables Purchase
Agreement dated as of June24, 2002 by and among Comdata Funding Corporation,
Comdata Network, Inc., as servicer, Jupiter Securitization Corporation, Bank
One, NA (Main Office Chicago), as Agent, and the Financial Institutions party
thereto, hereby acknowledges receipt of executed counterparts of a completed
Assignment Agreement dated as of ____________, ____ between __________________,
as Assignor, and __________________, as Assignee. Terms defined in such
Assignment Agreement are used herein as therein defined.
1. Pursuant to such Assignment Agreement, you are advised that
the Effective Date will be ___________________,_____.
2. Company hereby consents to the Assignment Agreement as
required by Section 12.1(b) of the Receivables Purchase Agreement.
Exh. VII-5
[3. Pursuant to such Assignment Agreement, the Assignee is
required to pay $____________ to Assignor at or before 12:00 noon (local time of
Assignor) on the Effective Date in immediately available funds.]
Very truly yours,
BANK ONE, NA (MAIN OFFICE CHICAGO),
individually and as Agent
By:
-----------------------------------------
Title:
--------------------------------------
JUPITER SECURITIZATION CORPORATION
By:
-----------------------------------------
Authorized Signer
Exh. VII-6
EXHIBIT VIII
CREDIT AND COLLECTION POLICY
See Exhibit V to Receivables Sale Agreement
Exh. VIII-1
EXHIBIT IX
FORM OF CONTRACT(S)
See Attached
Exh. IX-1
EXHIBIT X
FORM OF SETTLEMENT REPORT
The attached Settlement Report is a true and accurate
accounting pursuant to the terms of the Receivables Purchase Agreement dated as
of June 24, 2002 (as the same may be amended, supplemented, restated or
otherwise modified from time to time, the "Agreement"), by and among Comdata
Funding Corporation, Comdata Network, Inc., Jupiter Securitization Corporation,
the financial institutions party thereto and Bank One, NA (Main Office Chicago),
as agent, and I have no knowledge of the existence of any conditions or events
which constitute an Amortization Event or Potential Amortization Event, as each
such term is defined under the Agreement, during or at the end of the accounting
period covered by the attached Settlement Report or as of the date of this
certificate, except as set forth below.
By:
-------------------------------------------------
Name:
-----------------------------------------------
Title:
----------------------------------------------
Company Name:
---------------------------------------
Date:
-----------------------------------------------
Exh. X-1
EXHIBIT XI
FORM OF PERFORMANCE UNDERTAKING
[See Attached]
Exh. XI-1
EXHIBIT XII
FORM OF REDUCTION NOTICE
[Date]
Bank One, NA (Main Office Chicago), as Agent
1 Bank One Plaza, 21st Floor
Asset-Backed Finance
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: [Xxx Xxxxxx]
Re: REDUCTION NOTICE
Ladies and Gentlemen:
Reference is hereby made to the Receivables Purchase
Agreement, dated as of June24, 2002, by and among Comdata Funding Corporation, a
Delaware corporation (the "Seller"), Comdata Network, Inc., as Servicer, the
Financial Institutions, Jupiter Securitization Corporation ("Company"), and Bank
One, NA (Main Office Chicago), as Agent (the "Receivables Purchase Agreement").
Capitalized terms used herein shall have the meanings assigned to such terms in
the Receivables Purchase Agreement.
The Agent is hereby notified of the following request to
reduce Aggregate Capital from Collections:
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Aggregate Capital Reduction: $
-------------------------------------
---------------------------------------- --------------------------------------
Proposed Reduction Date:
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The amount of Aggregate Capital is $______________ after
giving effect to the reduction in Aggregate Capital to be made on the Proposed
Reduction Date
Very truly yours,
COMDATA FUNDING CORPORATION
By:
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Name:
Title:
Exh. XII-1
SCHEDULE A
COMMITMENTS OF FINANCIAL INSTITUTIONS
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Financial Institution Commitment
------------------------------------------------------------ ---------------------------------------------------------
Bank One, NA (Main Office Chicago) $ 153,000,000
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A-1
SCHEDULE B
DOCUMENTS TO BE DELIVERED TO THE AGENT
ON OR PRIOR TO THE INITIAL PURCHASE
PART I: DOCUMENTS TO BE DELIVERED IN CONNECTION WITH THE RECEIVABLES SALE
AGREEMENT
1. Executed copies of the Receivables Sale Agreement, duly executed by the
parties thereto.
2. Copy of the Resolutions of the Board of Directors of Originator
certified by its Secretary, authorizing Originator's execution,
delivery and performance of the Receivables Sale Agreement and the
other documents to be delivered by it thereunder.
3. Articles or Certificate of Incorporation of Originator certified by the
Secretary of State of the jurisdiction of incorporation of Originator
on or within thirty (30) days prior to the initial Purchase (as defined
in the Receivables Sale Agreement).
4. Good Standing Certificate for Originator issued by the Secretaries of
State of its state of incorporation and each jurisdiction where it has
material operations, each of which is listed below:
a. Maryland
b. Tennessee
5. A certificate of the Secretary of Originator certifying: (i) the names
and signatures of the officers authorized on its behalf to execute the
Receivables Sale Agreement and any other documents to be delivered by
it thereunder and (ii) a copy of Originator's By-Laws.
6. Pre-filing state and federal tax lien, judgment lien and UCC lien
searches against Originator from the following jurisdictions:
a. Maryland
b. Tennessee
7. Time stamped receipt copies of proper financing statements, duly filed
under the UCC on or before the date of the initial Purchase (as defined
in the Receivables Sale Agreement) in all jurisdictions as may be
necessary or, in the opinion of Seller (or its assigns), desirable,
under the UCC of all appropriate jurisdictions or any comparable law in
order to perfect the ownership interests contemplated by the
Receivables Sale Agreement.
8. Time stamped receipt copies of proper UCC termination statements, if
any, necessary to release all security interests and other rights of
any Person in the Receivables, Contracts or Related Security previously
granted by Originator.
9. Executed Collection Account Agreements for each Lock-Box and Collection
Account.
Sch. B-1
10. A favorable opinion of legal counsel for Originator reasonably
acceptable to Seller (or its assigns) which addresses the following
matters and such other matters as Seller (or its assigns) may
reasonably request:
-- Originator is a corporation duly incorporated,
validly existing, and in good standing under the laws
of its state of incorporation.
-- Originator has all requisite authority to conduct its
business in each jurisdiction where failure to be so
qualified would have a material adverse effect on
Originator's business.
-- Originator has all requisite power and authority to
execute, deliver and perform all of its obligations
under the Receivables Sale Agreement and each other
Transaction Document to which it is a party.
-- The execution and delivery by Originator of the
Receivables Sale Agreement and each other Transaction
Document to which it is a party and its performance
of its obligations thereunder have been duly
authorized by all necessary corporate action and
proceedings on the part of Originator and will not:
(a) require any action by or in respect of, or
filing with, any governmental body, agency
or official (other than the filing of UCC
financing statements);
(b) contravene, or constitute a default under,
any provision of applicable law or
regulation or of its articles or certificate
of incorporation or bylaws or of any
agreement, judgment, injunction, order,
decree or other instrument binding upon
Originator; or
(c) result in the creation or imposition of any
Adverse Claim on assets of Originator or any
of its Subsidiaries (except as contemplated
by the Receivables Sale Agreement).
-- The Receivables Sale Agreement and each other
Transaction Document to which it is a party has been
duly executed and delivered by Originator and
constitutes the legal, valid, and binding obligation
of Originator enforceable in accordance with its
terms, except to the extent the enforcement thereof
may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights
generally and subject also to the availability of
equitable remedies if equitable remedies are sought.
-- The provisions of the Receivables Sale Agreement are
effective to create a valid security interest in
favor of Seller in all Receivables and upon the
filing of financing statements, Seller shall acquire
a first priority, perfected security interest in such
Receivables.
Sch. B-2
-- For the purposes of the Maryland UCC, Originator is a
"registered organization".
-- Pursuant to the provisions of the Receivables Sale
Agreement, Originator has authorized the filing of
the Financing Statement identifying the Receivables,
Related Security and Collections for purposes of
Section 9-509 of the Maryland UCC.
-- The Financing Statement includes not only all of the
types of information required by Section 9-502(a) of
the Maryland UCC but also the types of information
without which the Filing Office may refuse to accept
the Financing Statement pursuant to Section 9-516 of
the Maryland UCC.
-- To the best of the opinion giver's knowledge, there
is no action, suit or other proceeding against
Originator or any Affiliate of Originator, which
would materially adversely affect the business or
financial condition of Originator and its Affiliates
taken as a whole or which would materially adversely
affect the ability of Originator to perform its
obligations under the Receivables Sale Agreement.
11. A "true sale" opinion and "substantive consolidation" opinion of
counsel for Originator with respect to the transactions contemplated by
the Receivables Sale Agreement.
12. A Compliance Certificate.
13. Executed copies of (i) all consents from and authorizations by any
Persons and (ii) all waivers and amendments to existing credit
facilities, that are necessary in connection with the Receivables Sale
Agreement.
14. Executed copies of the Subordinated Note (as defined in the Receivables
Sale Agreement) by Seller in favor of Originator.
15. A direction letter executed by Originator authorizing Seller (and its
assignees) and directing warehousemen to allow Seller (and its
assignees) to inspect and make copies from Originator's books and
records maintained at off-site data processing or storage facilities,
if applicable.
PART II: DOCUMENTS TO BE DELIVERED IN CONNECTION WITH THE AGREEMENT
1. Executed copies of the Agreement, duly executed by the parties thereto.
2. Copy of the Resolutions of the Board of Directors of each Seller Party
and Performance Guarantor certified by its Secretary authorizing such
Person's execution, delivery and performance of this Agreement and the
other documents to be delivered by it hereunder.
Sch. B-3
3. Articles or Certificate of Incorporation of each Seller Party and
Performance Guarantor certified by the Secretary of State of its
jurisdiction of incorporation on or within thirty (30) days prior to
the initial Incremental Purchase.
4. Good Standing Certificate for each Seller Party and Performance
Guarantor issued by the Secretaries of State of its state of
incorporation and each jurisdiction where it has material operations,
each of which is listed below:
a. Seller:
Delaware
Tennessee
b. Servicer:
Maryland
Tennessee
c. Performance Guarantor:
Delaware
Minnesota
5. A certificate of the Secretary of each Seller Party and Performance
Guarantor certifying (i) the names and signatures of the officers
authorized on its behalf to execute this Agreement and any other
documents to be delivered by it hereunder and (ii) a copy of such
Person's By-Laws.
6. Pre-filing state and federal tax lien, judgment lien and UCC lien
searches against each Seller Party from the following jurisdictions:
a. Seller:
Delaware
b. Servicer:
Maryland
Tennessee
7. Time stamped receipt copies of proper financing statements, duly filed
under the UCC on or before the date of the initial Incremental Purchase
in all jurisdictions as may be necessary or, in the opinion of the
Agent, desirable, under the UCC of all appropriate jurisdictions or any
comparable law in order to perfect the ownership interests contemplated
by this Agreement.
8. Time stamped receipt copies of proper UCC termination statements, if
any, necessary to release all security interests and other rights of
any Person in the Receivables, Contracts or Related Security previously
granted by Seller.
9. Executed copies of Collection Account Agreements for each Lock-Box and
Collection Account.
Sch. B-4
10. A favorable opinion of legal counsel for the Seller Parties and
Performance Guarantor reasonably acceptable to the Agent which
addresses the following matters and such other matters as the Agent may
reasonably request:
-- Each Seller Party and Performance Guarantor is a corporation
duly incorporated, validly existing, and in good standing
under the laws of its state of incorporation.
-- Each Seller Party and Performance Guarantor has all requisite
authority to conduct its business in each jurisdiction where
failure to be so qualified would have a material adverse
effect on such Person's business.
-- Each Seller Party and Performance Guarantor has all requisite
power and authority to execute, deliver and perform all of its
obligations under this Agreement and each other Transaction
Document to which it is a party.
-- The execution and delivery by each Seller Party and
Performance Guarantor of this Agreement and each other
Transaction Document to which it is a party and its
performance of its obligations thereunder have been duly
authorized by all necessary corporate action and proceedings
on the part of such Person and will not:
(a) require any action by or in respect of, or filing
with, any governmental body, agency or official
(other than the filing of UCC financing statements);
(b) contravene, or constitute a default under, any
provision of applicable law or regulation or of its
articles or certificate of incorporation or bylaws or
of any agreement, judgment, injunction, order, decree
or other instrument binding upon such Person; or
(c) result in the creation or imposition of any Adverse
Claim on assets of such Person or any of its
Subsidiaries (except as contemplated by this
Agreement).
-- The provisions of this Agreement are sufficient to constitute
authorization by Seller for the filing of the financing
statements required under this Agreement.
-- For the purposes of the Delaware UCC, Seller is a "registered
organization."
-- Pursuant to the provisions of the Receivables Purchase
Agreement, Seller has authorized the filing of the Financing
Statement identifying the Receivables, Related Security and
Collections for purposes of Section 9-509 of the Delaware UCC.
-- The Financing Statement includes not only all of the types of
information required by Section 9-502(a) of the Delaware UCC
but also the types of information without which the Filing
Office may refuse to accept the Financing Statement pursuant
to Section 9-516 of the Delaware UCC.
Sch. B-5
-- This Agreement and each other Transaction Document to which
such Person is a party has been duly executed and delivered by
such Person and constitutes the legal, valid, and binding
obligation of such Person, enforceable in accordance with its
terms, except to the extent the enforcement thereof may be
limited by bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally and subject
also to the availability of equitable remedies if equitable
remedies are sought.
-- The provisions of this Agreement are effective to create a
valid security interest in favor of the Agent for the benefit
of the Purchasers in all Receivables, and upon the filing of
financing statements, the Agent for the benefit of the
Purchasers shall acquire a first priority, perfected security
interest in such Receivables.
-- To the best of the opinion giver's knowledge, there is no
action, suit or other proceeding against any Seller Party,
Performance Guarantor or any of their respective Affiliates,
which would materially adversely affect the business or
financial condition of such Person and its Affiliates taken as
a whole or which would materially adversely affect the ability
of such Person to perform its obligations under any
Transaction Document to which it is a party.
11. If requested by Company or the Agent, a favorable opinion of legal
counsel for each Financial Institution, reasonably acceptable to the
Agent which addresses the following matters:
-- This Agreement has been duly authorized by all necessary
corporate action of such Financial Institution.
-- This Agreement has been duly executed and delivered by such
Financial Institution and, assuming due authorization,
execution and delivery by each of the other parties thereto,
constitutes a legal, valid and binding obligation of such
Financial Institution, enforceable against such Financial
Institution in accordance with its terms.
12. A Compliance Certificate.
13. The Fee Letter.
14. A Settlement Report as at May 31, 2002.
15. Executed copies of (i) all consents from and authorizations by any
Persons and (ii) all waivers and amendments to existing credit
facilities, that are necessary in connection with this Agreement.
16. A direction letter executed by Seller and the Servicer authorizing the
Agent and Company and directing warehousemen to allow the Agent and
Company to inspect and make copies from Seller's books and records
maintained at off-site data processing or storage facilities, if
applicable.
Sch. B-6
17. For each Purchaser that is not incorporated under the laws of the
United States of America, or a state thereof, two duly completed copies
of United States Internal Revenue Service Form 1001 or 4224, certifying
in either case that such Purchaser is entitled to receive payments
under the Agreement without deduction or withholding of any United
States federal income taxes.
Sch. B-7
