1
EXHIBIT 10.3
RECEIVABLES SALE AGREEMENT
DATED AS OF JULY 2, 2001
AMONG
CHOICEPOINT CAPITAL INC.,
AS SELLER,
AND
CHOICEPOINT FINANCIAL INC.,
AS PURCHASER
2
TABLE OF CONTENTS
PAGE
----
ARTICLE I CONTRIBUTION AND SALE OF RECEIVABLES............................................ 2
Section 1.1 Capitalization of Purchaser............................................. 2
Section 1.2 Purchases; Purchase Reports............................................. 2
Section 1.3 Payment for the Purchases............................................... 3
Section 1.4 Purchase Price Credit Adjustments....................................... 4
Section 1.5 Payments and Computations, Etc.......................................... 4
Section 1.6 License of Software..................................................... 5
Section 1.7 Intention of the Parties; Marking of Records; Further Assurances........ 5
Section 1.8 Characterization; Grant of Security Interest............................ 6
ARTICLE II REPRESENTATIONS AND WARRANTIES................................................. 6
Section 2.1 Representations and Warranties of Seller................................ 6
(a) Existence and Power........................................................... 6
(b) Power and Authority; Due Authorization, Execution and Delivery................ 7
(c) No Conflict................................................................... 7
(d) Governmental Authorization.................................................... 7
(e) Actions, Suits................................................................ 7
(f) Binding Effect................................................................ 7
(g) Accuracy of Information....................................................... 8
(h) Use of Proceeds............................................................... 8
(i) Good Title.................................................................... 8
(j) Perfection.................................................................... 8
(k) Places of Business and Locations of Records................................... 8
(l) LockBoxes, Etc................................................................ 8
(m) Seller Material Adverse Effect................................................ 9
(n) Names......................................................................... 9
(o) Ownership of Purchaser........................................................ 9
(p) Not a Holding Company or an Investment Company................................ 9
(q) Compliance with Law........................................................... 9
(r) Compliance with Credit and Collection Policy.................................. 9
(s) Payments to Seller............................................................ 9
(t) Enforceability of Contracts................................................... 10
(u) Eligible Receivables.......................................................... 10
(v) Accounting.................................................................... 10
(w) Solvency...................................................................... 10
i
3
ARTICLE III CONDITIONS OF PURCHASE........................................................ 10
Section 3.1 Conditions Precedent to Purchase........................................ 10
Section 3.2 Conditions Precedent to Subsequent Payments............................. 10
ARTICLE IV COVENANTS...................................................................... 11
Section 4.1 Affirmative Covenants of Seller......................................... 11
(a) Financial Reporting........................................................... 11
(i) Annual Reporting........................................................... 11
(ii) Quarterly Reporting........................................................ 11
(iii) Financial Officer's Certificate............................................ 11
(iv) S.E.C. Filings............................................................. 11
(v) Change in Credit and Collection Policy..................................... 11
(vi) Other Information.......................................................... 12
(b) Notices....................................................................... 12
(i) Termination Events or Unmatured Termination Events......................... 12
(ii) Judgment and Proceedings................................................... 12
(iii) Seller Material Adverse Effect............................................. 12
(c) Compliance with Laws and Preservation of Existence............................ 12
(d) Audits........................................................................ 13
(e) Keeping and Marking of Records and Books...................................... 13
(f) Compliance with Contracts and Credit and Collection Policy.................... 14
(g) Ownership..................................................................... 14
(h) Administrator's and Lender's Reliance......................................... 14
(i) Collections................................................................... 14
(j) Taxes......................................................................... 15
Section 4.2 Negative Covenants of Seller............................................ 15
(a) Name Change, Offices and Records.............................................. 15
(b) Change in Payment Instructions to Obligors.................................... 15
(c) Modifications to Contracts and Credit and Collection Policy................... 15
(d) Sales, Adverse Claims......................................................... 15
(e) Accounting for Purchases...................................................... 16
ARTICLE V TERMINATION EVENTS.............................................................. 16
Section 5.1 Termination Events...................................................... 16
Section 5.2 Remedies................................................................ 17
ARTICLE VI INDEMNIFICATION................................................................ 18
Section 6.1 Indemnities by Seller................................................... 18
Section 6.2 Other Costs and Expenses................................................ 20
ii
4
Section 6.3 Taxes................................................................... 20
ARTICLE VII MISCELLANEOUS................................................................. 20
Section 7.1 Waivers and Amendments.................................................. 20
Section 7.2 Notices................................................................. 21
Section 7.3 Protection of Ownership Interests of Purchaser.......................... 21
Section 7.4 Confidentiality......................................................... 22
Section 7.5 Bankruptcy Petition..................................................... 22
Section 7.6 CHOICE OF LAW........................................................... 23
Section 7.7 CONSENT TO JURISDICTION................................................. 23
Section 7.8 WAIVER OF JURY TRIAL.................................................... 23
Section 7.9 Integration; Binding Effect; Survival of Terms.......................... 24
Section 7.10 Counterparts; Severability; Section References.......................... 24
EXHIBITS AND SCHEDULES
Exhibit I - Definitions
Exhibit II - Chief Executive Office; Principal Place(s) of Business;
Location(s) of Records; Federal Employer Identification
Number; Other Names
Exhibit III - LockBoxes, LockBox Accounts, Depositary Accounts
Exhibit IV - Form of Financial Officer's Certificate
Exhibit V - Form of Subordinated Note
Exhibit VI Form of Purchase Report
Schedule A List of Documents to Be Delivered to Purchaser Prior to the
Closing Date
iii
5
RECEIVABLES SALE AGREEMENT
THIS RECEIVABLES SALE AGREEMENT, dated as of July 2, 2001, is
by and between:
(a) ChoicePoint Capital Inc., a Delaware corporation (together
with its successors, "SELLER"), and
(b) ChoicePoint Financial Inc., a Delaware corporation
(together with its successors, "PURCHASER").
UNLESS DEFINED ELSEWHERE HEREIN, CAPITALIZED TERMS USED IN THIS AGREEMENT SHALL
HAVE THE MEANINGS ASSIGNED TO SUCH TERMS IN EXHIBIT I HERETO OR, IF NOT DEFINED
THEREIN, IN THE FIRST STEP SALE AGREEMENT (HEREINAFTER DEFINED).
PRELIMINARY STATEMENTS
Purchaser may from time to time acquire various Receivables
and the Related Security and Collections associated therewith pursuant
to that certain Receivables Sale and Contribution Agreement dated as of
July 2, 2001 by and among ChoicePoint Services Inc. ("PARENT
ORIGINATOR"), PRC Corporation, a Georgia corporation, ChoicePoint
Business and Government Services Inc., a Georgia corporation,
ChoicePoint Direct Inc., an Illinois corporation, Statewide Data
Services, Inc., a Florida corporation, I.R.S.C., Inc., a California
corporation, ChoicePoint Public Records Inc., a Georgia corporation,
Patlex Corporation, a Pennsylvania corporation, National Safety
Alliance Incorporated, a Tennessee corporation, and BTi Employee
Screening Services Inc., a Texas corporation (all of the foregoing
including Parent Originator, collectively, the "ORIGINATORS"), as
sellers, and Seller, as purchaser (as amended, restated or otherwise
modified from time to time, the "FIRST STEP SALE AGREEMENT").
Seller wishes to contribute all of Seller's right, title and
interest in certain of the Receivables and to sell all other
Receivables, in each case, together with the associated Collections and
Related Security, to Purchaser, and Purchaser wishes to acquire the
foregoing from Seller.
Each of the parties hereto intends the transactions
contemplated hereby to be true sales or other outright conveyances of
Receivables to Purchaser, providing Purchaser with the full benefits of
ownership of the Receivables transferred to it, and neither of the
parties hereto intends any of such transactions to be, or for any
purpose to be characterized as, loans from Purchaser to Seller.
1
6
Purchaser intends to finance certain of its purchases of
Receivables hereunder in part by borrowing under that certain Loan
Agreement dated as of July 2, 2001 (as the same may from time to time
hereafter be amended, supplemented, restated or otherwise modified, the
"LOAN AGREEMENT") among Purchaser, as borrower, Parent Originator, as
initial servicer, Three Pillars Funding Corporation (together with its
successors and permitted assigns, "LENDER"), and SunTrust Equitable
Securities Corporation, as agent and administrator for Lender (in such
capacity, together with its successor and assigns in such capacity, the
"ADMINISTRATOR").
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I
CONTRIBUTION AND SALE OF RECEIVABLES
Section 1.1 Capitalization of Purchaser. Effective on the Closing
Date: (a) Seller hereby contributes to Purchaser all Existing Receivables (the
"ORIGINAL CONTRIBUTED RECEIVABLES"), together with the associated Collections
and Related Security, in exchange for 100% of Purchaser's authorized capital
stock, and (b) Purchaser hereby accepts from Seller as a contribution to
Purchaser's capital, the Original Contributed Receivables, together with the
associated Collections and Related Security.
Section 1.2 Purchases; Purchase Reports.
(a) Upon the terms and subject to the conditions set forth herein,
effective on the Closing Date and on each Business Day after the Closing Date
through and including the Termination Date (each such Business Day, a "PURCHASE
DATE"), Seller does hereby sell, assign, transfer, set-over and otherwise convey
to Purchaser, in consideration for the Purchase Price, without recourse (except
to the extent expressly provided herein), and Purchaser does hereby purchase
from Seller, all of Seller's right, title and interest in and to all Receivables
(other than Original Contributed Receivables) existing as of the close of
business on the Business Day immediately preceding such Purchase Date, together
with all Related Security and Collections associated therewith. Purchaser shall
be obligated to pay the Purchase Price for the Receivables purchased hereunder
in accordance with Section 1.3.
(b) On each Reporting Date, Seller shall (or shall require
Servicer to) deliver to Purchaser (with a copy to Administrator) a report in
substantially the form of Exhibit VI hereto (each such report being herein
called a "PURCHASE REPORT") with respect to the Receivables sold during the
Calculation Period then most recently ended. In addition to, and not in
limitation of, the foregoing, in connection with the payment of the Purchase
Price for any
2
7
Receivables purchased hereunder, Purchaser may request that Seller deliver, and
Seller shall deliver, such information or documents as Purchaser may reasonably
request.
Section 1.3 Payment for the Purchases.
(a) The Purchase Price for each Purchase shall be payable in full
by Purchaser to Seller on the applicable Purchase Date in the following manner:
(i) by delivery to Seller or its designee of immediately
available funds;
(ii) by delivery to Seller or its designee of the proceeds
of a subordinated revolving loan from Seller to Purchaser (each, a
"SUBORDINATED LOAN") in an amount not to exceed the least of (A) the
remaining unpaid portion of such Purchase Price, (B) the maximum
Subordinated Loan that could be borrowed without rendering Purchaser's
Net Worth less than the Required Capital Amount, and (C) fifteen
percent (15%) of such Purchase Price. Seller is hereby authorized by
Purchaser to endorse on the schedule attached to the Subordinated Note
an appropriate notation evidencing the date and amount of each advance
thereunder, as well as the date of each payment with respect thereto,
PROVIDED THAT the failure to make such notation shall not affect any
obligation of Purchaser thereunder, and
(iii) at Seller's election unless the Termination Date has
occurred, by accepting a contribution to its capital in an amount equal
to the remaining unpaid balance of such Purchase Price.
Seller irrevocably agrees to advance each Subordinated Loan requested by
Purchaser on or prior to the Termination Date. The Subordinated Loans owing to
Seller shall be evidenced by, and shall be payable in accordance with the terms
and provisions of the Subordinated Note and shall be payable solely from funds
which Purchaser is not required under the Receivables Sale Agreement to set
aside for the benefit of, or otherwise pay over to, Purchaser.
(b) From and after the Termination Date, Seller shall not be
obligated to (but may, at its option) sell or contribute Receivables to
Purchaser.
(c) Although the Purchase Price for each Receivable shall be due
and payable in full by Purchaser to Seller on the Purchase Date immediately
following the Business Day on which such Receivable came into existence,
settlement of the Purchase Price between Purchaser and Seller shall be effected
on a monthly basis on Settlement Dates with respect to all Receivables
originated during the same Calculation Period and based on the information
contained in the Purchase Report delivered by or on behalf of Seller for the
Calculation Period then most recently ended. Although settlement shall be
effected on Settlement Dates, increases or decreases in the amount owing under
the Subordinated Note made pursuant to Section 1.3 and any contribution of
capital by Seller to Purchaser made pursuant to Section 1.3(a)(iii) shall be
3
8
deemed to have occurred and shall be effective as of the last Business Day of
the Calculation Period to which such settlement relates.
Section 1.4 Purchase Price Credit Adjustments. If on any day:
(a) the Outstanding Balance of any Receivable purchased from
Seller is:
(i) reduced as a result of any defective, rejected or
returned goods or services, any discount or adjustment or otherwise by
Seller (OTHER THAN A REDUCTION IN SUCH OUTSTANDING BALANCE RESULTING
FROM (A) cash Collections received by Purchaser or Servicer, on
Purchaser's behalf, on account of such Receivable's Outstanding
Balance, or (B) any reserve established against or write-off of such
Receivable that is made due to its becoming a Defaulted Receivable),
(ii) reduced (in whole or in part) 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
(b) any of the representations and warranties set forth in
Sections 2.1(h), (i), (j), (r), (s), (t), (u), the second sentence of Section
2.1(q) hereof and the last clause (relating to bulk sales laws) of Section
2.1(c) are not true when made or deemed made with respect to any Receivable,
then, in such event, Purchaser shall be entitled to a credit (each, a "PURCHASE
PRICE CREDIT") against the Purchase Price otherwise payable to Seller hereunder
equal to (x) in the case of a reduction under the preceding clause (a)(i) or
(ii), the amount of such whole or partial reduction, and (y) in the case of a
misrepresentation described in the preceding clause (b), the full Outstanding
Balance of such Receivable. If such Purchase Price Credit exceeds the aggregate
Original Balance of the Receivables on any day, Seller shall pay the remaining
amount of such Purchase Price Credit in cash (i) if the Termination Date has not
occurred, not later than the next Settlement Date, and (ii) if the Termination
Date has occurred, immediately, PROVIDED THAT if the Termination Date has not
occurred, Seller shall be allowed to deduct the remaining amount of any Purchase
Price Credit owing by it from any indebtedness owed to it under the Subordinated
Note.
Section 1.5 Payments and Computations, Etc. All amounts to be
paid or deposited by Purchaser hereunder shall be paid or deposited in
accordance with the terms hereof on the day when due in immediately available
funds to the account of Seller designated from time to time by Seller or as
otherwise directed by Seller. In the event that any payment owed by any Person
hereunder becomes due on a day that is not a Business Day, then such payment
shall be made on the next succeeding Business Day. If any Person fails to pay
any amount hereunder when due, such Person agrees to pay, on demand, the Default
Fee in respect thereof until paid in full; PROVIDED, HOWEVER, that such Default
Fee shall not at any time exceed the maximum rate
4
9
permitted by applicable law. All computations of interest payable hereunder
shall be made on the basis of a year of 360 days for the actual number of days
(including the first but excluding the last day) elapsed.
Section 1.6 License of Software.
(a) To the extent that any software used by Seller to account for
the Receivables is non-transferable, Seller hereby grants to Purchaser, Servicer
and their respective assigns, an irrevocable, non-exclusive license to use,
without royalty or payment of any kind, all such software used by Seller to
account for such Receivables, to the extent necessary to administer such
Receivables, whether such software is owned by Seller or is owned by others and
used by Seller under license agreements with respect thereto, PROVIDED THAT
should the consent of any licensor of such software be required for the grant of
the license described herein, to be effective, Seller hereby agrees that upon
the request of Purchaser (or its assigns), Seller will use its reasonable
efforts to obtain the consent of such third-party licensor. The license granted
hereby shall be irrevocable until the later to occur of (i) indefeasible payment
in full of the Obligations (as defined in the Loan Agreement), and (ii) the date
on which each of this Agreement and the Loan Agreement terminates in accordance
with its terms.
(b) Seller (i) shall take such action requested by Purchaser
and/or Administrator (as the ultimate assignee), from time to time hereafter,
that may be necessary or appropriate to ensure that Purchaser and its assigns
have an enforceable ownership interest in the records included in the Receivable
Files relating to the Receivables purchased from Seller hereunder, and (ii)
shall use its reasonable efforts to ensure that Purchaser, Servicer and their
respective assigns each has an enforceable right (whether by license or
sublicense or otherwise) to use all of the computer software used to account for
such Receivables and/or to recreate such records.
Section 1.7 Intention of the Parties; Marking of Records; Further
Assurances. It is the intention of the parties hereto that each sale or
contribution of Receivables under this Agreement shall constitute a sale or
other absolute transfer and assignment, which sale or other transfer is absolute
and irrevocable and provides Purchaser with the full benefits of ownership of
the Receivables. Except for the Purchase Price Credits owed to Seller pursuant
to Section 1.4, each sale of Receivables hereunder by Seller is made without
recourse to Seller; PROVIDED, HOWEVER, that (i) Seller shall be liable to
Purchaser and each of its assigns for all representations, warranties, covenants
and indemnities made by Seller pursuant to the terms of the Transaction
Documents to which Seller is a party, and (ii) such sale does not constitute,
and is not intended to result in, an assumption by Purchaser or any assignee
thereof of any obligation of Seller or any other Person arising in connection
with the Receivables, the related Contracts and/or other Related Security or any
other obligations of Seller. In view of the intention of the parties hereto that
each Purchase of Receivables made hereunder shall constitute a purchase and sale
of such Receivables rather than a loan secured thereby, Seller agrees that it
will, on or prior to the Closing Date and in accordance with Section 4.1(e)(ii),
▇▇▇▇ its master data processing records
5
10
relating to the Receivables with a legend stating that Purchaser has purchased
such Receivables and to note in its financial statements that its Receivables
have been sold to Purchaser. Upon the request of Purchaser or any of its
assigns, Seller will execute and file such financing or continuation statements,
or amendments thereto or assignments thereof, and such other instruments or
notices, as may be necessary or appropriate to perfect and maintain the
perfection of Purchaser's ownership interest in the Receivables and the Related
Security (other than Excluded Items) that is subject to Article 9 of the UCC and
Collections with respect thereto, or as Purchaser or any of its assigns may
reasonably request.
Section 1.8 Characterization; Grant of Security Interest. If,
notwithstanding the intention of the parties expressed in Section 1.7, any sale
or contribution by Seller of Receivables hereunder shall be characterized as a
secured loan and not a sale or such sale or contribution shall for any reason be
ineffective or unenforceable, then this Agreement shall be deemed to constitute
a security agreement under the UCC and other applicable law. For this purpose
and without being in derogation of the parties' intention that each sale or
contribution of Receivables by Seller hereunder shall constitute a true sale or
other outright conveyance thereof: Seller hereby grants to Purchaser a valid and
continuing security interest in all of Seller's right, title and interest in, to
and under all Receivables which are now existing or hereafter created by Seller,
all Collections and Related Security with respect thereto, all other rights and
payments relating to such Receivables and all proceeds of the foregoing to
secure the prompt and complete payment of a loan deemed to have been made in an
amount equal to the Purchase Price of the Receivables purchased from Seller
together with all other obligations of Seller hereunder, which security interest
shall be prior to all other Adverse Claims thereto. Purchaser and its assigns
shall have, in addition to the rights and remedies which 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.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of Seller. On the
Closing Date and on each Purchase Date, Seller hereby represents and warrants to
Purchaser, as to Seller and the Receivables originated by it, as follows:
(a) Existence and Power. Seller is a corporation duly incorporated
under the laws of the state indicated after its name in the preamble to this
Agreement (Seller's "APPLICABLE STATE"). Seller is validly existing and in good
standing under the laws of its Applicable State and is duly qualified to do
business and is in good standing as a foreign corporation, and has and holds all
corporate power and all governmental licenses, authorizations, consents and
approvals required to carry on its business in each jurisdiction in which its
business is conducted except where the failure to so qualify or so hold could
not reasonably be expected to have a Seller Material Adverse Effect.
6
11
(b) Power and Authority; Due Authorization, Execution and
Delivery. The execution and delivery by Seller of this Agreement and each other
Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder, and Seller's use of the proceeds of the
Purchases made from it hereunder, are within its corporate powers and authority
and have been duly authorized by all necessary corporate action on its part.
This Agreement and each other Transaction Document to which Seller is a party
has been duly executed and delivered by Seller.
(c) No Conflict. The execution and delivery by Seller of this
Agreement and each other Transaction Document to which it is a party, and the
performance of its obligations hereunder and thereunder do not contravene or
violate (i) its Organizational Documents, (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 it or 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 assets of Seller or its Subsidiaries (except as created
hereunder) except, in any case described in clauses (i)-(iv) inclusive, where
such contravention or violation could not reasonably be expected to have a
Seller Material Adverse Effect; and no transaction contemplated hereby requires
compliance with any bulk sales act or similar law.
(d) Governmental Authorization. Other than the filing of the
financing statements required hereunder, 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 Seller of this
Agreement and each other Transaction Document to which it is a party and the
performance of its obligations hereunder and thereunder.
(e) Actions, Suits. Except as disclosed in the SEC Filings, there
is no litigation, arbitration, governmental investigation, proceeding or inquiry
pending or, to the knowledge of any of their officers, threatened against or
affecting Seller or any of its Subsidiaries which could reasonably be expected
to have a Seller Material Adverse Effect or which seeks to prevent, enjoin or
delay the making or repayment of any Subordinated Loans. Other than any
liability incident to any litigation, arbitration or proceeding which could not
reasonably be expected to have a Seller Material Adverse Effect, Seller and its
Subsidiaries have no material contingent obligations not provided for or
disclosed in the SEC Filings.
(f) Binding Effect. This Agreement and each other Transaction
Document to which Seller is a party constitute the legal, valid and binding
obligations of Seller enforceable against Seller in accordance with their
respective 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).
7
12
(g) Accuracy of Information. All written information heretofore
furnished by Seller or any of its Affiliates to Purchaser (or its assigns) 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
written information hereafter furnished by Seller or any of its Affiliates to
Purchaser (or its assigns) 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, taken as a whole,
not misleading.
(h) Use of Proceeds. No portion of any Purchase Price payment to
Seller hereunder will be used for a purpose that violates, or would be
inconsistent with, any law, rule or regulation applicable to Seller.
(i) Good Title. Immediately prior to each Purchase from Seller
hereunder and upon the creation of each Receivable, Seller (i) is the legal and
beneficial owner of the Receivables and (ii) is the legal and beneficial owner
of the Related Security with respect thereto or possesses a valid and perfected
security interest therein, 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 such Receivable, its Collections and the
Related Security (except for Excluded Items).
(j) Perfection. This Agreement, together with the filing of the
financing statements contemplated hereby, is effective to transfer to Purchaser
(and Purchaser shall acquire from Seller) (i) legal and equitable title to, with
the right to sell and encumber each Receivable originated by Seller, whether now
existing and hereafter arising, together with the Collections with respect
thereto, and (ii) all of Seller's right, title and interest in the Related
Security associated with each such Receivable (except for Excluded Items), in
each case, 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 Purchaser's
ownership interest in such Receivables, the Related Security (except for
Excluded Items) and the Collections.
(k) Places of Business and Locations of Records. Seller's chief
executive office, principal place(s) of business, and locations where it keeps
all of its Receivable Files are located at the address(es) listed on Exhibit II
or such other locations of which Purchaser has been notified in accordance with
Section 4.2(a) in jurisdictions where all action required by Section 4.2(a) has
been taken and completed. Seller's Federal Employer Identification Number is
correctly set forth on Exhibit II.
(l) LockBoxes, Etc. The addresses of all existing LockBoxes and
the banks, account names and account numbers for all existing LockBox Accounts
and Depositary Accounts are correctly listed on Exhibit III. Seller has not
granted any Person, other than
8
13
Purchaser (and Administrator, as its pledgee) dominion and control of any
LockBox, any LockBox Account or any Depositary Account, or the right to take
dominion and control of any such LockBox, LockBox Account or Depositary Account
at a future time or upon the occurrence of a future event.
(m) Seller Material Adverse Effect. Since the date on which Seller
was incorporated, no event has occurred that would have a Seller Material
Adverse Effect.
(n) Names. The name in which Seller has executed this Agreement is
identical to the name of Seller as indicated on the public records of its
Applicable State. 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 as listed on Exhibit II.
(o) Ownership of Purchaser. Seller owns, directly or indirectly,
100% of the issued and outstanding equity interests of Purchaser, free and clear
of any Adverse Claims. Such equity interests are validly issued, fully paid and
nonassessable, and there are no options, warrants or other rights to acquire
securities of Purchaser.
(p) Not a Holding Company or an Investment Company. Seller 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. Seller is not an "investment company" within
the meaning of the Investment Company Act of 1940, as amended, or any successor
statute.
(q) Compliance with Law. Seller has complied 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 Seller Material Adverse Effect. Each
Receivable originated by Seller, 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 where such contravention
or violation could not reasonably be expected to have a Seller Material Adverse
Effect.
(r) Compliance with Credit and Collection Policy. Seller 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 change
to such Credit and Collection Policy, except such material change as to which
Purchaser (or its assigns) has been notified in accordance with Section
4.1(a)(vii).
(s) Payments to Seller. With respect to each Receivable sold to
Purchaser by Seller hereunder, the Purchase Price received by Seller constitutes
reasonably equivalent value in
9
14
consideration therefor. No transfer hereunder by Seller of any Receivable is or
may be voidable under any section of the Bankruptcy Reform Act of 1978 (11
U.S.C.ss.ss.101 et seq.), as amended.
(t) Enforceability of Contracts. Each Contract with respect to
each Receivable sold by Seller hereunder is effective to create, and has
created, a legally valid and binding obligation of the related Obligor to pay
the Outstanding Balance of the Receivable created thereunder 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).
(u) Eligible Receivables. Each Receivable which is reflected in
any Purchase Report as an Eligible Receivable was an Eligible Receivable on the
date of its acquisition by Purchaser hereunder.
(v) Accounting. The manner in which Seller accounts for the
transactions contemplated by this Agreement in its financial statements does not
jeopardize the characterization of the transactions contemplated herein as being
true sales.
(w) Solvency. Seller is Solvent.
ARTICLE III
CONDITIONS OF PURCHASE
Section 3.1 Conditions Precedent to Purchase. The initial
Purchase from Seller under this Agreement is subject to the conditions precedent
that (a) Purchaser shall have been capitalized with the Initial First Step
Contribution, and (b) Purchaser shall have received on or before the date of
such Purchase those documents listed on Schedule A.
Section 3.2 Conditions Precedent to Subsequent Payments.
Purchaser's obligation to pay Seller for any Receivable shall be subject to the
further conditions precedent that: (a) as of the applicable Purchase Date,
Purchaser (or its assigns) shall have received such other documents as it may
reasonably request and (b) as of the applicable Purchase Date, the following
statements shall be true (and acceptance of the proceeds of any payment for such
Receivable shall be deemed a representation and warranty by Seller that such
statements are then true):
(i) the representations and warranties of Seller set
forth in Article II are true and correct in all material respects on
and as of the date such Receivable came into existence as though made
on and as of such date; PROVIDED THAT the materiality
10
15
threshold in the preceding clause shall not be applicable with respect
to any representation or warranty which itself contains a materiality
threshold; and
(ii) no event has occurred and is continuing that will
constitute a Termination Event or an Unmatured Termination Event.
Notwithstanding the foregoing conditions precedent, upon the applicable Purchase
Date for any Receivable, title to such Receivable and the Related Security and
Collections with respect thereto shall vest in Purchaser, whether or not the
conditions precedent to Purchaser's obligation to pay for such Receivable were
in fact satisfied and whether or not the Purchase Price has actually been paid
as of such date; PROVIDED, HOWEVER, that failure of Seller to satisfy any of the
foregoing conditions precedent shall give rise to a right of Purchaser to
rescind the related Purchase and direct Seller to pay to Purchaser an amount
equal to the Purchase Price payment, if any, made with respect to the
Receivables included in such Purchase.
ARTICLE IV
COVENANTS
Section 4.1 Affirmative Covenants of Seller. Until the date on
which this Agreement terminates in accordance with its terms, Seller hereby
covenants as set forth below:
(a) Financial Reporting. Seller will maintain, for itself
and each Consolidated Subsidiary, a system of accounting established and
administered in accordance with generally accepted accounting principles, and
furnish to Purchaser (and its assigns):
(i) Annual Reporting. Within 95 days after the
close of each of its fiscal years, the financial statements required to be
delivered to Seller under Section 4.1(a)(i) of the First Step Sale Agreement.
(ii) Quarterly Reporting. Within 50 days after
the close of the first three quarterly periods of each of its fiscal years, the
financial statements and certificates required to be delivered to Seller under
Section 4.1(a)(ii) of the First Step Sale Agreement
(iii) Financial Officer's Certificate. Together
with the financial statements required hereunder, a certificate in substantially
the form of Exhibit IV signed by a Financial Officer of Seller and dated the
date of such annual financial statement or such quarterly financial statement,
as the case may be.
(iv) S.E.C. Filings. Promptly upon the filing
thereof, copies of all tender offer documents and reports on Form 8-K (or any
successor form thereto) which ChoicePoint Inc. or any of its Subsidiaries files
with the Securities and Exchange Commission.
(v) 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
11
16
Collection Policy, a copy of the Credit and Collection Policy then in effect and
a notice (A) indicating such proposed material change or material 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 in any material respect, requesting Purchaser's
(and, if the Loan Agreement remains in effect, Administrator's) consent thereto.
(vi) 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 Seller as
Purchaser (or its assigns) may from time to time reasonably request in order to
protect the interests of Purchaser (and its assigns) under or as contemplated by
this Agreement.
(b) Notices. As soon as practicable and in any event within one
(1) Business Day after learning of any of the following, Seller will notify
Purchaser (and, while the Loan Agreement remains in effect, Administrator) in
writing of any of the following, describing the same and, if applicable, the
steps being taken with respect thereto:
(i) Termination Events or Unmatured Termination
Events. The occurrence of each Termination Event and each Unmatured Termination
Event, by a statement of a Financial Officer of Seller.
(ii) Judgment and Proceedings. (1) The entry of
any judgment or decree against ChoicePoint Inc. or any of its Subsidiaries if
the aggregate amount of all judgments and decrees then outstanding against
ChoicePoint Inc. and its Subsidiaries exceeds $5,000,000 after deducting (a) the
amount with respect to which ChoicePoint Inc. or such Subsidiary is insured and
with respect to which the insurer has assumed responsibility in writing or
undertaken the defense with a reservation of rights, and (b) the amount for
which ChoicePoint Inc. or such Subsidiary is otherwise indemnified if the terms
of such indemnification are satisfactory to Purchaser (or its assigns), and (2)
the institution of any litigation, arbitration proceeding or governmental
proceeding against Seller which, individually or in the aggregate, could
reasonably be expected to have a Seller Material Adverse Effect.
(iii) Seller Material Adverse Effect. The
occurrence of any event or condition that has had, or could reasonably be
expected to have, a Seller Material Adverse Effect.
(c) Compliance with Laws and Preservation of Existence. Seller
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 Seller Material Adverse Effect. Seller will preserve and maintain its
legal existence, rights, franchises and privileges in the jurisdiction of its
organization, and qualify and remain qualified in good standing as a foreign
entity in each
12
17
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
Seller Material Adverse Effect.
(d) Audits. Seller will furnish to Purchaser and Administrator (as
Purchaser's pledgee) from time to time such information with respect to Seller
and the Receivables sold or contributed by it as Purchaser (or Administrator)
may reasonably request. Seller will, from time to time during regular business
hours as requested by Purchaser (or Administrator), upon reasonable notice and
at the sole cost of Seller, permit an accounting firm designated by Purchaser
(or by Administrator), on at least a semi-annual basis: (i) to examine and make
copies of and abstracts from all Receivable Files in the possession or under the
control of Seller and other records relating to the Receivables originated by
Seller, the Collections and the Related Security, including, without limitation,
the related Contracts, and (ii) to visit the offices and properties of Seller
for the purpose of examining such materials described in clause (i) above, and
to discuss matters relating to Seller's financial condition or the Receivables
and the Related Security or Seller's performance under any of the Transaction
Documents or Seller's performance under the Contracts and, in each case, with
any of the officers or employees of Seller having knowledge of such matters;
PROVIDED, HOWEVER, that unless and until a Termination Event shall have occurred
and be continuing, Seller and the Originators in the aggregate shall not be
responsible to pay for more than two (2) such examinations in any period
beginning on July 2 of one year and ending on July 1 of the following year.
(e) Keeping and Marking of Records and Books.
(i) Seller 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 Receivable and all Collections of and adjustments to each
Receivable sold or contributed by it). Seller will give Purchaser (or
its assigns) notice of any material change in the administrative and
operating procedures referred to in the previous sentence.
(ii) Seller will (A) on or prior to the Closing
Date, ▇▇▇▇ its master data processing records and other books and
records relating to the Receivables with a legend, acceptable to
Purchaser (or its assigns), describing Purchaser's ownership interests
in such Receivables and (B) upon the request of Purchaser (or its
assigns) from and after the occurrence of a Termination Event: (x) ▇▇▇▇
each invoice evidencing any Receivable with a legend describing
Purchaser's ownership thereof and (y) at any time after Seller (or one
of its Affiliates) is no longer acting as Servicer, deliver to
Purchaser (or its assigns) all Contracts relating to such Receivables.
13
18
(f) Compliance with Contracts and Credit and Collection Policy.
Seller will timely and fully (i) perform and comply in all material respects
with all provisions, covenants and other promises required to be observed by it
under the Contracts related to the Receivables, and (ii) comply in all respects
with the Credit and Collection Policy in regard to each such Receivable and the
related Contract.
(g) Ownership. Seller will take all necessary action to establish
and maintain, irrevocably in Purchaser: (A) legal and equitable title to the
Receivables and the Collections and (B) all of Seller's right, title and
interest in the Related Security associated with the Receivables (except for
Excluded Items), in each case, free and clear of any Adverse Claims other than
Adverse Claims in favor of Purchaser (and its assigns) (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 Purchaser's interest in such Receivables, Related
Security (except for Excluded Items) and Collections and such other action to
perfect, protect or more fully evidence the interest of Purchaser as Purchaser
(or its assigns) may reasonably request).
(h) Administrator's and Lender's Reliance. Seller acknowledges
that Purchaser is entering into the transactions contemplated by the Receivables
Sale Agreement, and Administrator and Lender are entering into the transactions
contemplated by the Loan Agreement, in reliance upon Purchaser's identity as a
legal entity that is separate from Seller and any Affiliates thereof. Therefore,
from and after the Closing Date, Seller will take all reasonable steps within
Seller's control to maintain Purchaser's identity as a separate legal entity and
to make it manifest to third parties that Purchaser is an entity with assets and
liabilities distinct from those of Seller and any Affiliates thereof and not
just a division of Seller or any such Affiliate. Without limiting the generality
of the foregoing and in addition to the other covenants set forth herein, Seller
(i) will not hold itself out to third parties as liable for the debts of
Purchaser nor purport to own any of the Receivables and other assets acquired by
Purchaser, (ii) will not take any action that would cause Purchaser to violate
the "separateness covenants" set forth in Section 7.1(i) of the Loan Agreement
and (iii) will cause all tax liabilities arising in connection with the
transactions contemplated herein or otherwise to be allocated between Seller and
Purchaser on an arm's-length basis and in a manner consistent with the
procedures set forth in U.S. Treasury Regulations ss.ss.1.1502-33(d) and
1.1552-1.
(i) Collections. 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
LockBox Account or a Depositary Account within one (1) Business Day following
receipt 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 Purchaser and its assigns. Seller will transfer exclusive
ownership, dominion and control of each LockBox, LockBox Account and Depositary
Account to Purchaser and, will not grant the right to take dominion and control
of any LockBox, any LockBox Account or any Depositary Account at
14
19
a future time or upon the occurrence of a future event to any Person, except to
Purchaser, as contemplated by this Agreement, and to Administrator, as
contemplated by the Loan Agreement.
(j) Taxes. Seller will file all tax returns and reports required
by law to be filed by it and promptly pay all Covered Taxes at any time owing,
except any such Covered Taxes which are not yet delinquent or are being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on its
books.
Section 4.2 Negative Covenants of Seller. Until the date on which
this Agreement terminates in accordance with its terms, Seller hereby covenants
that:
(a) Name Change, Offices and Records. Seller will not change its
(i) state of organization, (ii) name, (iii) identity or structure (within the
meaning of Article 9 of any applicable enactment of the UCC) or relocate its
chief executive office at any time while the location of its chief executive
office is relevant to perfection of Purchaser's interest in the Receivables or
the associated Related Security (except for Excluded Items) and Collections or
any office where Receivable Files are kept unless, in each of the foregoing
cases, it shall have: (A) given Purchaser (and Administrator as Purchaser's
pledgee) written notice thereof within 30 days thereafter and (B) delivered to
Administrator (as Purchaser's pledgee) all financing statements, instruments and
other documents reasonably requested by Purchaser (or Administrator, as
Purchaser's pledgee) in connection with such change or relocation.
(b) Change in Payment Instructions to Obligors. Seller will not
add or terminate any LockBox, LockBox Account or Depositary Account, or make any
change in the instructions to Obligors regarding payments to be made to any
LockBox, any LockBox Account or any Depositary Account, unless Purchaser and, if
the Loan Agreement remains in effect, Administrator 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 LockBox, LockBox Account or Depositary Account, an executed
LockBox and Collection Account Agreement; PROVIDED, HOWEVER, that Seller may
make changes in instructions to Obligors regarding payments if such new
instructions require such Obligor to make payments to another existing LockBox,
LockBox Account, Depositary Account.
(c) Modifications to Contracts and Credit and Collection Policy.
Seller will not make any change to the Credit and Collection Policy that could
reasonably be expected to adversely affect the collectibility of the Receivables
or decrease the credit quality of any of its newly created Receivables. Except
as otherwise permitted in its capacity as a sub-Servicer, Seller 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, Adverse Claims. 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
15
20
exist any Adverse Claim upon (including, without limitation, the filing of any
financing statement) or with respect to, any Receivable, Related Security or
Collections, or upon or with respect to any Contract under which any Receivable
arises, or any LockBox, LockBox Account or Depositary 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 Purchaser provided for herein),
and Seller will defend the right, title and interest of Purchaser in, to and
under any of the foregoing property, against all claims of third parties
claiming through or under Seller.
(e) Accounting for Purchases. Seller will not, and will not permit
any Affiliate to, account for the transactions contemplated hereby in any
financial statements in any manner other than the sale (or other outright
conveyance) by Seller to Purchaser of the Receivables and the associated
Collections and Related Security except to the extent that such transactions are
not recognized on account of consolidated financial reporting in accordance with
generally accepted accounting principles.
ARTICLE V
TERMINATION EVENTS
Section 5.1 Termination Events. The occurrence of any one or more
of the following events shall constitute a Termination Event:
(a) Seller shall fail to make any payment or deposit required
hereunder when due and such failure shall continue for three (3) consecutive
Business Days.
(b) Any representation, warranty, certification or statement made
by Seller in this Agreement, any other Transaction Document or in any other
document delivered pursuant hereto or thereto shall prove to have been incorrect
in any material respect when made or deemed made; PROVIDED THAT the materiality
threshold in the preceding clause shall not be applicable with respect to any
representation or warranty which itself contains a materiality threshold and
PROVIDED FURTHER, that any misrepresentation or certification for which
Purchaser has actually received a Purchase Price Credit from Seller shall not
constitute a Termination Event hereunder.
(c) Seller shall breach any covenant contained in Section
4.1(b)(i) which is not cured within three (3) Business Days, or Seller shall
breach any covenant contained in Section 4.2(c) or 4.2(e), which is not cured
within thirty (30) days, or Seller shall breach any covenant contained in
Section 4.2(a), (b) or (d).
(d) Seller shall breach, fail to perform or observe any covenant
contained in any Section of this Agreement (which is not covered by another
subsection, paragraph or clause of this Section 5.1) or of any other Transaction
Document to which it is a party which is not remedied within thirty (30) days
after written notice from Purchaser (or, at any time while the Loan Agreement
remains in effect, Administrator).
16
21
(e) Failure of Seller or any of its Subsidiaries to pay any of its
Material Debts when due; or the default by Seller or any of its Subsidiaries in
the performance of any term, provision or condition contained in any agreement
under which such Material Debt was created or is governed, or any other event
shall occur or condition exist, the effect of which is to cause, or to permit
the holder or holders of such Material Debt to cause such Material Debt to
become due prior to its stated maturity; or any Material Debt of Seller or any
of its Subsidiaries shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled payment or as a result of the sale
of an asset securing such Material Debt) prior to the stated maturity thereof.
(f) (i) Seller 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 Seller 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) Seller shall take any corporate action to authorize any of
the actions set forth in the foregoing clauses (i) or (ii) of this subsection
(f).
(g) A Change of Control shall occur.
(h) Seller or any of its Subsidiaries shall fail within 30 days
to pay, bond or otherwise discharge any judgment or order for the payment of
money in excess of $5,000,000, which is not stayed on appeal or otherwise being
appropriately contested in good faith.
(i) The Subordinated Note shall be assigned, pledged or otherwise
transferred to any Person in violation of the last section thereof.
Section 5.2 Remedies. Upon the occurrence and during the continuation
of a Termination Event, Purchaser may take any of the following actions: (i)
declare the Termination Date to have occurred, whereupon the Termination Date
shall forthwith occur, without demand, protest or further notice of any kind,
all of which are hereby expressly waived by Seller; PROVIDED, HOWEVER, that upon
the occurrence of a Termination Event described in Section 5.1(f), or of an
actual or deemed entry of an order for relief with respect to Seller under the
United States Bankruptcy Code, the Termination Date shall automatically occur,
without demand, protest or any notice of any kind, all of which are hereby
expressly waived by Seller and (ii) to the fullest extent permitted by
applicable law, declare that the Default Fee shall accrue with respect to any
amounts then due and owing by Seller to Purchaser. The aforementioned rights and
remedies shall be without limitation and shall be in addition to all other
rights and remedies of Purchaser and its assigns 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,
17
22
without limitation, all rights and remedies provided under the UCC, all of which
rights shall be cumulative.
ARTICLE VI
INDEMNIFICATION
Section 6.1 Indemnities by Seller. Without limiting any other
rights that Purchaser may have hereunder or under applicable law, Seller hereby
agrees to indemnify (and pay upon demand to) Purchaser and its assigns,
officers, directors, agents and employees (each a "SELLER INDEMNIFIED PARTY")
from and against any and all damages, losses, claims, Covered Taxes,
liabilities, costs, expenses and for all other amounts payable, including
reasonable attorneys' fees (which attorneys may be employees of Purchaser or any
such assign) and disbursements (all of the foregoing being collectively referred
to as "SELLER INDEMNIFIED AMOUNTS") awarded against or incurred by any of them
arising out of any of the following:
(i) any representation or warranty made by Seller (or any
officers of Seller) under or in connection with any Purchase Report,
this Agreement, any other Transaction Document to which Seller is a
party or any other information or report delivered by Seller pursuant
hereto or thereto for which Purchaser has not received a Purchase Price
Credit that shall have been false or incorrect when made or deemed
made;
(ii) the failure by Seller, 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 Seller to keep or perform any of its obligations,
express or implied, with respect to any Contract;
(iii) any failure of Seller to perform its duties,
covenants or other obligations in accordance with the provisions of
this Agreement or any other Transaction Document to which Seller is a
party;
(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
to which Seller is a party or any Receivable;
(v) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor or failure to pay due to
financial inability) 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;
18
23
(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 to
which Seller is a party, the transactions contemplated hereby, Seller's
use of the proceeds of the Purchase from it hereunder, the ownership of
the Receivables or any other investigation, litigation or proceeding
relating to Seller in which any Seller 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 failure to vest and maintain vested in Purchaser,
or to transfer to Purchaser, legal and equitable title to, and
ownership of, the Receivables and the associated Collections, and all
of Seller's right, title and interest in the Related Security
associated with such Receivables (other than Excluded Items), in each
case, free and clear of any Adverse Claim;
(x) 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 or the Related Security (other than Excluded
Items) and Collections with respect thereto, and the proceeds of any
thereof, whether at the time of the applicable Purchase from Seller
hereunder or at any subsequent time;
(xi) any attempt by any Person to void any Purchase from
Seller hereunder under statutory provisions or common law or equitable
action; and
(xii) the failure of any Receivable that is reflected as an
Eligible Receivable on any Purchase Report prepared by Seller (or by
Servicer on its behalf) to be an Eligible Receivable at the time
acquired by Purchaser;
EXCLUDING, HOWEVER, (a) Seller Indemnified Amounts to the extent a final
judgment of a court of competent jurisdiction holds that Seller Indemnified
Amounts resulted from gross negligence or willful misconduct on the part of the
Seller Indemnified Party seeking indemnification; (b) Seller Indemnified Amounts
to the extent the same includes losses in respect of Receivables originated by
that are uncollectible on account of the insolvency, bankruptcy or lack of
creditworthiness of the related Obligor; and (c) Excluded Taxes. Nothing in this
Section 6.1 shall limit the liability
19
24
of Seller or limit the recourse of Purchaser to Seller for amounts otherwise
specifically provided to be paid by Seller under the terms of this Agreement.
Section 6.2 Other Costs and Expenses. Seller agrees to pay to
Purchaser, on demand, (a) all reasonable out-of-pocket costs and expenses in
connection with (i) the preparation, execution and delivery of this Agreement
and the other documents to be delivered hereunder, and (ii) the preparation,
execution and delivery of any amendment hereto or waiver hereof requested by
Seller, and (b) any and all reasonable costs and expenses of Purchaser, if any,
including reasonable counsel fees and expenses, in connection with the
enforcement of this Agreement and the other documents delivered hereunder.
Section 6.3 Taxes. All payments by Seller to or for the account
of Purchaser (or any of its assigns) hereunder or under any other Transaction
Document to which Seller is a party shall be made free and clear of and without
deduction for any and all Covered Taxes. If Seller shall be required by law to
deduct any Covered Taxes from or in respect of any sum payable hereunder to
Purchaser (or any of its assigns), (a) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 6.3), Purchaser (or
such assign, as the case may be) receives an amount equal to the sum it would
have received had no such deductions been made, (b) Seller shall make such
deductions, (c) Seller shall pay the full amount deducted to the relevant
authority in accordance with applicable law and (d) Seller shall furnish to
Purchaser (and to Administrator, as the ultimate assignee) the original copy of
a receipt evidencing payment thereof within 30 days after such payment is made.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Waivers and Amendments.
(a) No failure or delay on the part of Purchaser (or its
assigns) 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 signed by Seller and
Purchaser and, for so long as the Loan Agreement remains in effect to
the extent required thereunder, by Administrator. At any time while the
Loan Agreement remains in effect, any material amendment, supplement,
modification or waiver will require
20
25
Administrator's receipt of written notice from S&P and ▇▇▇▇▇'▇ that
such change will not cause the rating on the then outstanding
commercial paper of Lender to be downgraded or withdrawn.
Section 7.2 Notices. 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
Schedule B hereto 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 (a) if given by
telecopy, upon the receipt thereof, (b) if given by mail, five (5) Business Days
after the time such communication is deposited in the mail with first class
postage prepaid or (c) if given by any other means, when received at the address
specified in this Section 7.2.
Section 7.3 Protection of Ownership Interests of Purchaser.
(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 Purchaser (or its assigns)
may reasonably request, to perfect, protect or more fully evidence the interest
of Purchaser and its assigns therein, or to enable Purchaser (or its assigns) to
exercise and enforce their rights and remedies hereunder. At any time following
the earlier to occur of a Termination Event or an Amortization Event: Purchaser
(or its assigns) may, at Seller's sole cost and expense, direct Seller to notify
the Obligors of Receivables of the ownership interests of Purchaser under this
Agreement and may also direct that payments of all amounts due or that become
due under any or all such Receivables be made directly to Purchaser or its
designee.
(b) If Seller fails to perform any of its obligations hereunder:
(i) with not less than ten (10) days' prior written
notice (or, if such 10-days would have the effect of extending the cure
period, if any, applicable to Seller's nonperformance, such shorter
period of prior written notice as would not cause such an extension),
Purchaser (or its assigns) may (but shall not be required to) perform,
or cause performance of, such obligations, and Purchaser's (or such
assigns') costs and expenses incurred in connection therewith shall be
payable by Seller as provided in Section 6.2;
(ii) Seller irrevocably authorizes Purchaser (and its
assigns) at any time and from time to time in the sole discretion of
Purchaser (or its assigns), and appoints Purchaser (and its assigns) as
its attorney(ies)-in-fact, to act on behalf of Seller (A) to execute on
behalf of Seller as debtor (if the debtor's signature is required) and
to file financing statements (with or without Seller's signature, as
debtor, as permitted by applicable law) necessary or desirable in
Purchaser's (or its assigns') sole discretion to perfect and to
maintain the perfection and priority of the interest of Purchaser in
the
21
26
Receivables and the associated Related Security (except for Excluded
Items) and Collections and (B) 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
Purchaser (or its assigns) in their sole discretion deem necessary or
desirable to perfect and to maintain the perfection and priority of
Purchaser's interests in such Receivables.
The appointment under the foregoing clause (ii) is coupled with an interest and
is irrevocable.
Section 7.4 Confidentiality.
(a) Seller shall maintain and shall cause each of its
employees and officers to maintain the confidentiality of the Fee Letter and the
other confidential or proprietary information with respect to Administrator and
Lender and their respective businesses obtained by it or them in connection with
the structuring, negotiating and execution of the transactions contemplated
herein, except that Seller and its officers and employees may disclose such
information to Seller's external accountants, attorneys and other advisors and
as required by any applicable law, rule, direction, request or order of any
judicial, administrative or regulatory authority or proceeding (whether or not
having the force or effect of law). The restrictions in this Section 7.4(a)
shall not apply to any information which is or becomes generally available to
the public other than as a result of disclosure by Seller or one of its
Affiliates.
(b) Seller hereby consents to the disclosure of any
nonpublic information with respect to it (i) to Purchaser, Administrator, the
Liquidity Banks or Lender by each other, (ii) to any prospective or actual
assignee or participant of any of the Persons described in clause (i), (iii) to
any of Lender's rating agencies, commercial paper dealers or Support Providers
or to any entity organized for the purpose of purchasing, or making loans
secured by, financial assets for which Administrator acts as the administrative
agent or administrator and to any officers, directors, employees, outside
accountants and attorneys of any of the foregoing, PROVIDED each Person
described in the foregoing clauses (ii) and (iii) is informed of the
confidential nature of such information, and (iv) as required 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 7.5 Bankruptcy Petition. Seller 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 Lender, it will not institute
against, or join any other Person in instituting against, Lender 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. Seller 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 Purchaser, it will not institute against, or join any other
Person in instituting against, Purchaser any bankruptcy, reorganization,
arrangement, insolvency
22
27
or liquidation proceedings or other similar proceeding under the laws of the
United States or any state of the United States
Section 7.6 CHOICE OF LAW. THIS AGREEMENT SHALL BE A CONTRACT
MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW) EXCEPT TO THE EXTENT THAT THE LAWS OF
ANOTHER JURISDICTION GOVERN THE PERFECTION, OR THE EFFECT OF PERFECTION OR
NONPERFECTION, OF THE OWNERSHIP OR SECURITY INTERESTS OF PURCHASER.
Section 7.7 CONSENT TO JURISDICTION. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW
YORK STATE COURT SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SELLER
PURSUANT TO THIS AGREEMENT, AND EACH OF THE PARTIES HERETO 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 PURCHASER (OR ITS ASSIGNS) TO BRING PROCEEDINGS AGAINST
SELLER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY
SELLER AGAINST PURCHASER (OR ITS ASSIGNS) OR ANY AFFILIATE THEREOF INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SELLER PURSUANT TO
THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW YORK, NEW YORK.
Section 7.8 WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, 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 ORIGINATOR PURSUANT TO THIS
AGREEMENT OR THE RELATIONSHIP ESTABLISHED HEREUNDER OR THEREUNDER.
23
28
Section 7.9 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 Seller, Purchaser and their respective successors and permitted assigns
(including any trustee in bankruptcy). Seller may not assign any of its rights
and obligations hereunder or any interest herein without the prior written
consent of Purchaser (and, while the Loan Agreement remains in effect,
Administrator). Purchaser may assign at any time its rights and obligations
hereunder and interests herein to any other Person without the consent of
Seller. Without limiting the foregoing, Seller acknowledges that Purchaser,
pursuant to the Loan Agreement, may pledge to Administrator, for the benefit of
Lender and its assigns, its rights, remedies, powers and privileges hereunder.
Seller agrees that Administrator, as the pledgee of Purchaser, shall, subject to
the terms of the Loan Agreement, have the right to enforce this Agreement and to
exercise directly all of Purchaser's rights and remedies under this Agreement
(including, without limitation, the right to give or withhold any consents or
approvals of Purchaser to be given or withheld hereunder). 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 Seller pursuant to Article II; (ii) the indemnification and payment
provisions of Article VI; and (iii) Section 7.5 shall be continuing and shall
survive any termination of this Agreement.
Section 7.10 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.
[signature pages follow]
24
29
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.
CHOICEPOINT CAPITAL INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Treasurer
CHOICEPOINT FINANCIAL INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Treasurer
25
30
EXHIBIT I
Definitions
This is Exhibit I to the Agreement (as hereinafter defined). As used in
the Agreement and the Exhibits and Schedules thereto, capitalized terms have the
meanings set forth in this Exhibit I (such meanings to be equally applicable to
the singular and plural forms thereof). IF A CAPITALIZED TERM IS USED IN THE
AGREEMENT AND IS NOT OTHERWISE DEFINED THEREIN OR IN THIS EXHIBIT I, SUCH TERM
SHALL HAVE THE MEANING ASCRIBED THERETO IN THE FIRST STEP SALE AGREEMENT
(HEREINAFTER DEFINED).
"ADMINISTRATOR" has the meaning set forth in the Preliminary Statements
to the Agreement.
"AGREEMENT" means the Receivables Sale Agreement, dated as of July 2,
2001, between Seller and Purchaser, as the same may be amended, restated or
otherwise modified.
"APPLICABLE STATE" has the meaning set forth in Section 2.1(a) of the
Agreement
"CALCULATION PERIOD" means each calendar month or portion thereof which
elapses during the term of the Agreement. The first Calculation Period shall
commence on the date of the initial Purchase hereunder and the final Calculation
Period shall terminate on the Termination Date.
"CHANGE OF CONTROL" means (a) a "Change of Control" under and as
defined in the First Step Agreement, or (b) Seller ceases to own , directly or
indirectly, 100% of the outstanding voting securities of Purchaser.
"COVERED TAXES" means all Taxes other than Excluded Taxes.
"DISCOUNT FACTOR" means a percentage calculated to provide Purchaser
with a reasonable profit from its investment in the Receivables after taking
account of (i) the time value of money based upon the anticipated dates of
collection of such Receivables and the cost to Purchaser of financing its
investment in such Receivables during such period, (ii) the risk of nonpayment
by the Obligors, and (iii) the cost to Purchaser of paying the Servicer to
service and collect the Receivables and Related Security on Purchaser's behalf.
Seller and Purchaser may agree from time to time to change the Discount Factor
applicable to Receivables based on changes in one or more of the items affecting
the calculation thereof, PROVIDED THAT any change to the Discount Factor shall
take effect as of the commencement of a Calculation Period, shall apply only
prospectively and shall not affect the Purchase Price payment made prior to the
Calculation Period during which Seller and Purchaser agree to make such change.
As of the Closing Date, the Discount Factor in respect of the Receivables
purchased by Purchaser from Seller is 0%.
26
31
"EXCLUDED ITEMS" means the interest of Seller (or Purchaser, as its
assignee) in Related Security which, by operation of law or enforceable
contractual restrictions, either (i) cannot be transferred by Seller to
Purchaser or (ii) cannot be subjected to an Adverse Claim which can be perfected
by filing a UCC financing statement in the state where Seller maintains its
chief executive office or is organized.
"EXCLUDED TAXES" means, in the case of Purchaser (or any other Seller
Indemnified Party), taxes imposed on its overall net income, and franchise taxes
and branch profit taxes based on net income imposed on it, by (i) the
jurisdiction under the laws of which Purchaser (or other Seller Indemnified
Party) is incorporated or organized or (ii) the jurisdiction in which
Purchaser's (or Seller Indemnified Party's) principal executive office is
located.
"EXISTING RECEIVABLE" means an "EXISTING RECEIVABLE" under and as
defined in the First Step Sale Agreement in which Seller now has or hereafter
acquires any rights.
"LENDER" has the meaning set forth in the Preliminary Statements to the
Agreement.
"LOAN AGREEMENT" has the meaning set forth in the Preliminary
Statements to the Agreement.
"MATERIAL DEBT" means Debt of Seller and/or one or more of its
Subsidiaries, arising in one or more related or unrelated transactions, in an
aggregate principal or face amount exceeding $10,700.
"MATERIAL ORIGINATOR" means, on any date of determination, any
Originator who originated more than 10% of the total Receivables originated
during the Calculation Period then most recently ended.
"NET WORTH" means as of the last Business Day of each Calculation
Period preceding any date of determination, the excess, if any, of (a) the
aggregate Outstanding Balance of the Receivables at such time, OVER (b) the sum
of (i) the aggregate outstanding principal balance of the Loans under the Loan
Agreement at such time, PLUS (ii) the aggregate outstanding principal balance of
the Subordinated Loans (including any Subordinated Loan proposed to be made on
the date of determination).
"ORIGINAL CONTRIBUTED RECEIVABLES" has the meaning set forth in Section
1.1 of the Agreement.
"ORIGINATORS" has the meaning set forth in the preamble to the
Agreement.
"PARENT ORIGINATOR" has the meaning set forth in the preamble to the
Agreement.
27
32
"PURCHASE" means each purchase by Purchaser from Seller pursuant to
Section 1.2 of the Agreement of Receivables and the Related Security and
Collections related thereto, together with all related rights in connection
therewith.
"PURCHASE DATE" has the meaning set forth in Section 1.2(a)of the
Agreement.
"PURCHASE PRICE" means, with respect to each Purchase by Purchaser from
Seller, the aggregate price to be paid by Purchaser to Seller for such Purchase
in accordance with Section 1.3 of the Agreement for the Receivables and the
associated Collections and Related Security being sold to Purchaser, which price
shall equal on any date (i) the product of (x) the Outstanding Balance of such
Receivables on such date, MULTIPLIED BY (y) one minus the Discount Factor in
effect on such date, minus (ii) any Purchase Price Credits to be credited in
accordance with Section 1.4 of the Agreement against the Purchase Price
otherwise payable.
"PURCHASE PRICE CREDIT" has the meaning set forth in Section 1.4 of the
Agreement.
"PURCHASE REPORT" has the meaning set forth in Section 1.2(b) of the
Agreement.
"PURCHASER" has the meaning set forth in the preamble to the Agreement.
"RECEIVABLE" means a "RECEIVABLE" under and as defined in the First
Step Sale Agreement in which Seller now has or hereafter acquires any rights.
"RECEIVABLES SALE AGREEMENT" has the meaning set forth in the
Preliminary Statements to the Agreement.
"RELATED SECURITY" means, with respect to any Receivable, (a) all
"Related Security" under and as defined in the First Step Sale Agreement in
which Seller now has or hereafter acquires any rights, and (b) all right, title
and interest of Seller in and to, but not its obligations under, the First Step
Sale Agreement.
"SELLER INDEMNIFIED AMOUNTS" has the meaning set forth in Section 6.1.
"SELLER INDEMNIFIED PARTY" has the meaning set forth in Section 6.1.
"SELLER MATERIAL ADVERSE EFFECT" means a material adverse effect on (i)
on the business, property, condition (financial or otherwise) or results of
operations of the Originators and their Subsidiaries (including Seller) taken as
a whole, (ii) the ability of Seller to perform its obligations under the
Agreement or any other Transaction Document to which it is a party, (iii) the
legality, validity or enforceability of the Agreement or any other Transaction
Document, (iv) any Originator's, Seller's, Purchaser's, Administrator's or
Lender's interest in the Receivables generally or in any significant portion of
the Receivables, the Related Security or Collections
28
33
with respect thereto, or (v) the collectibility of the Receivables generally or
of any material portion of the Receivables.
"SUBORDINATED LOAN" has the meaning set forth in Section 1.3(a) of the
Agreement.
"SUBORDINATED NOTE" means the promissory note in substantially the form
of Exhibit V hereto as more fully described in Section 1.3 of the Agreement, as
the same may be amended, restated, supplemented or otherwise modified from time
to time.
"TERMINATION DATE" means the earliest to occur of (i) the Commitment
Termination Date (as defined in the Loan Agreement), (ii) the Business Day
immediately prior to the occurrence of a Termination Event set forth in Section
5.1(f), (iii) the Business Day specified in a written notice from Purchaser to
Seller following the occurrence of any other Termination Event, (iv) the
occurrence of any Material Originator's Termination Date under the First Step
Sale Agreement, and (v) the date which is ten (10) Business Days after
Purchaser's receipt of written notice from Seller that it wishes to terminate
the facility evidenced by this Agreement.
"TERMINATION EVENT" has the meaning set forth in Section 5.1 of the
Agreement.
"TRANSACTION DOCUMENTS" means, collectively, the First Step Sale
Agreement, the First Step Notes, the Agreement, the Subordinated Note, and all
other instruments, documents and agreements executed and delivered by Seller or
Purchaser in connection with the foregoing.
"UNMATURED TERMINATION EVENT" means an event which, with the passage of
time or the giving of notice, or both, would constitute a Termination Event
under the Agreement.
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
NEW YORK, AND NOT SPECIFICALLY DEFINED HEREIN, ARE USED HEREIN AS DEFINED IN
SUCH ARTICLE 9.
29