EXHIBIT 2.29
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THIRD AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
among
PARADIGM FUNDING LLC,
GIRO MULTI-FUNDING CORPORATION,
ASSET ONE SECURITIZATION, LLC
LIBERTY STREET FUNDING CORP.
as Conduit Investors
NMC FUNDING CORPORATION,
as Transferor
NATIONAL MEDICAL CARE, INC.,
as Collection Agent
THE FINANCIAL INSTITUTIONS PARTIES HERETO,
as Bank Investors
BAYERISCHE LANDESBANK, NEW YORK BRANCH,
as an Administrative Agent
SOCIETE GENERALE,
as an Administrative Agent
THE BANK OF NOVA SCOTIA
as an Administrative Agent
and
WESTLB AG, NEW YORK BRANCH,
as an Administrative Agent and as Agent
Dated as of October 23, 2003
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Defined Terms....................................... 1
SECTION 1.2. Other Terms................................................. 20
SECTION 1.3. Computation of Time Periods................................. 20
SECTION 1.4. Amendment and Restatement................................... 20
SECTION 1.5. Funding on Effective Date................................... 20
ARTICLE II
PURCHASE AND SETTLEMENTS
SECTION 2.1. Facility.................................................... 21
SECTION 2.2. Transfers; Certificates; Eligible Receivables (a)
Incremental Transfers....................................... 21
SECTION 2.3. Selection of Tranche Periods and Tranche Rates.............. 23
SECTION 2.4. Discount, Fees and Other Costs and Expenses................. 25
SECTION 2.5. Non-Liquidation Settlement and Reinvestment Procedures...... 25
SECTION 2.6. Liquidation Settlement Procedures........................... 25
SECTION 2.7. Fees........................................................ 26
SECTION 2.8. Protection of Ownership Interest of the Investors; Special
Accounts and Concentration Account.......................... 27
SECTION 2.9. Deemed Collections; Application of Payments................. 28
SECTION 2.10. Payments and Computations, Etc.............................. 28
SECTION 2.11. Reports..................................................... 29
SECTION 2.12. Collection Account.......................................... 29
SECTION 2.13. Sharing of Payments, Etc.................................... 29
SECTION 2.14. Right of Setoff............................................. 29
SECTION 2.15. Additional Transferring Affiliates.......................... 29
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the Transferor............ 30
SECTION 3.2. Representations and Warranties of the Collection Agent...... 34
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1. Conditions to Closing....................................... 35
ARTICLE V
COVENANTS
SECTION 5.1. Affirmative Covenants of Transferor......................... 36
SECTION 5.2. Negative Covenants of the Transferor........................ 40
SECTION 5.3. Affirmative Covenants of the Collection Agent............... 43
SECTION 5.4. Negative Covenants of the Collection Agent.................. 44
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ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.1. Appointment of Collection Agent............................. 44
SECTION 6.2. Duties of Collection Agent.................................. 44
SECTION 6.3. Right After Designation of New Collection Agent............. 46
SECTION 6.4. Collection Agent Default.................................... 46
SECTION 6.5. Responsibilities of the Transferor.......................... 47
ARTICLE VII
TERMINATION EVENTS
SECTION 7.1. Termination Events.......................................... 47
SECTION 7.2. Termination................................................. 50
ARTICLE VIII
INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 8.1. Indemnities by the Transferor............................... 50
SECTION 8.2. Indemnity for Taxes, Reserves and Expenses.................. 52
SECTION 8.3. Taxes....................................................... 54
SECTION 8.4. Other Costs, Expenses and Related Matters................... 55
SECTION 8.5. Reconveyance Under Certain Circumstances.................... 56
ARTICLE IX
THE AGENT; BANK COMMITMENT; THE ADMINISTRATIVE AGENTS
SECTION 9.1. Authorization and Action.................................... 56
SECTION 9.2. Agent's Reliance, Etc....................................... 57
SECTION 9.3. Credit Decision............................................. 57
SECTION 9.4. Indemnification of the Agent................................ 57
SECTION 9.5. Successor Agent............................................. 57
SECTION 9.6. Payments by the Agent....................................... 58
SECTION 9.7. Bank Commitment; Assignment to Bank Investors............... 58
SECTION 9.8. Appointment of Administrative Agents........................ 60
SECTION 9.9. Administrative Agent's Reliance, Etc........................ 61
SECTION 9.10. Indemnification of the Administrative Agents................ 62
SECTION 9.11. Successor Administrative Agents............................. 62
SECTION 9.12. Payments by the Administrative Agents....................... 62
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ARTICLE X
MISCELLANEOUS
SECTION 10.1. Term of Agreement........................................... 63
SECTION 10.2. Waivers; Amendments......................................... 63
SECTION 10.3. Notices..................................................... 63
SECTION 10.4. Governing Law; Submission to Jurisdiction; Integration...... 65
SECTION 10.5. Severability; Counterparts.................................. 66
SECTION 10.6. Successors and Assigns...................................... 66
SECTION 10.7. Waiver of Confidentiality................................... 66
SECTION 10.8. Confidentiality Agreement................................... 66
SECTION 10.9. No Bankruptcy Petition Against Conduit Investors............ 67
SECTION 10.10. No Recourse Against Stockholders, Officers or Directors..... 68
SECTION 10.11. Characterization of the Transactions Contemplated by the
Agreement................................................... 68
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SCHEDULES
SCHEDULE I Notice Addresses of Bank Investors
SCHEDULE II Commitments of Bank Investors
SCHEDULE III Agreed Upon Procedures
EXHIBITS
EXHIBIT A Forms of Contracts
EXHIBIT B Credit and Collection Policies and Practices
EXHIBIT C List of Special Account Banks, Designated Account Agents and
Bank Concentration
EXHIBIT D-1 Form of Special Account Letter
EXHIBIT D-2 Form of Concentration Account Agreement
EXHIBIT E Form of Investor Report
EXHIBIT F Form of Transfer Certificate
EXHIBIT G Form of Assignment and Assumption Agreement
EXHIBIT H List of Actions and Suits (Sections 3.1(g), 3.1(k) and
3.3(e))
EXHIBIT I Location of Records
EXHIBIT J Form of Business Associate Agreement
EXHIBIT K Forms of Opinions of Counsel
EXHIBIT L Forms of Secretary's Certificate
EXHIBIT M Form of Certificate
EXHIBIT N List of Approved Fiscal Intermediaries
EXHIBIT O Form of Transferring Affiliate Letter
EXHIBIT P Form of Parent Agreement
EXHIBIT Q List of Transferring Affiliates
EXHIBIT R Form of Account Agent Agreement
EXHIBIT S List of Closing Documents
EXHIBIT T Form of Agreed Upon Procedures Report
EXHIBIT U Form of "No Material Weakness" Report
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THIRD AMENDED AND RESTATED
TRANSFER
AND ADMINISTRATION AGREEMENT
THIRD AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT (this
"Agreement"), dated as of October 23, 2003, by and among NMC FUNDING
CORPORATION, a Delaware corporation, as transferor (in such capacity, the
"Transferor"), NATIONAL MEDICAL CARE, INC., a Delaware corporation, as the
initial "Collection Agent", PARADIGM FUNDING LLC, a Delaware limited liability
company ("Paradigm"), as a Conduit Investor, GIRO MULTI-FUNDING CORPORATION, a
Delaware Corporation ("GMFC"), as a Conduit Investor, ASSET ONE SECURITIZATION,
LLC, a Delaware limited liability company ("Asset One"), as a Conduit Investor,
LIBERTY STREET FUNDING CORP., a Delaware corporation ("Liberty Street"), as a
Conduit Investor, the FINANCIAL INSTITUTIONS PARTIES HERETO, as Bank Investors,
BAYERISCHE LANDESBANK,
NEW YORK BRANCH ("BAYERNLB"), as an Administrative Agent,
SOCIETE GENERALE ("SG"), as an Administrative Agent, THE BANK OF NOVA SCOTIA
("Scotiabank"), as an Administrative Agent and WESTLB AG,
NEW YORK BRANCH
(formerly known as Westdeutsche Landesbank Girozentrale,
New York Branch)
("WestLB"), as an Administrative Agent and as agent (in such capacity, the
"Agent") for the Investors.
PRELIMINARY STATEMENTS
WHEREAS, the Transferor, the Collection Agent, the Conduit Investors, the
Bank Investors, the Administrative Agents, and the Agent (other than Scotiabank
and Liberty Street) are parties to that certain Second Amended and Restated
Transfer and Administration Agreement dated as of September 24, 2002 (as amended
prior to the date hereof, the "Existing TAA"); and
WHEREAS, the parties hereto desire to amend and restate the Existing TAA in
its entirety.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"Account Agent Agreement" means an agreement in substantially the form of
Exhibit R hereto.
"Administrative Agent" means (i) WestLB, as administrative agent for the
Related Group that includes Paradigm, (ii) BayernLB, as administrative agent for
the Related Group that includes GMFC, (iii) Societe Generale, as administrative
agent for the Related Group that includes Asset One or (iv) Scotiabank, as
administrative agent for the Related Group that includes Liberty Street.
"Administration Fee" means the fee payable by the Transferor to the Agent
pursuant to Section 2.7(iii) hereof, the terms of which are set forth in the
Agent Fee Letter.
"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 (including any UCC financing statement or any similar
instrument filed against such Person's assets or properties), other than
customary rights of set-off and other similar claims.
"Affected Assets" means, collectively, the Receivables and the Related
Security, Collections and Proceeds relating thereto.
"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. A Person shall be deemed to control another Person if
the controlling Person 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 voting stock, by contract or otherwise.
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"Agent" means WestLB, in its capacity as agent for the Investors, and any
successor thereto appointed pursuant to Article IX.
"Agent Fee Letter" means the letter agreement dated as of the Closing Date
between the Transferor and the Agent relating to certain fees payable by the
Transferor to the Agent hereunder, as amended, restated, supplemented or
otherwise modified from time to time.
"Aggregate Unpaids" means, at any time, an amount equal to the sum of (i)
the aggregate accrued and unpaid Discount with respect to all Tranche Periods at
such time, (ii) the Net Investment at such time, and (iii) all other amounts
owed (whether due or accrued) hereunder by the Transferor to the Investors at
such time.
"Agreement" shall have the meaning specified in the Preamble to this
Agreement.
"Amendment Agreement" means the amendment agreement dated as of October 23,
2003 among the parties to the Existing TAA.
"Applicable Margin" means at any time for purposes of calculating the
Eurodollar Rate for any Eurodollar Tranche Period:
(i) the applicable margin corresponding to the Consolidated Leverage
Ratio (as such term is defined in the Parent Agreement) set forth below as
determined as of the last day of the month then most recently ended for
which an Investor Report shall have been delivered to each Administrative
Agent:
CONSOLIDATED LEVERAGE RATIO APPLICABLE MARGIN
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< 1.75...................................................... 0.450%
$ 1.75 but < 2.0............................................ 0.500%
$ 2.0 but < 2.5............................................. 0.625%
$ 2.50 but < 3.0............................................ 0.875%
$ 3.0 but < 3.25............................................ 1.000%
$ 3.25 but < 3.75........................................... 1.250%
$ 3.75 but < 4.0............................................ 1.375%
$ 4.0 but < 4.25............................................ 1.500%
$ 4.25...................................................... 1.750%
; provided that, if any Tranche is not funded through the issuance of Commercial
Paper for more than 90 days, then from and after such 90(th) day, the Applicable
Margin shall be equal to the higher of (i) 1.25% or (ii) the applicable margin
set forth in the table above.
The Applicable Margin shall be determined on each date that an Investor Report
shall be delivered by the Transferor or the Collection Agent to each
Administrative Agent and such Applicable Margin shall remain in effect until the
date upon which the next Investor Report shall have been so delivered to each
Administrative Agent, at which time the Applicable Margin shall be redetermined
in accordance with the Consolidated Leverage Ratio reported at such time.
"Asset One" means Asset One Securitization, LLC, a limited liability
company organized under the laws of Delaware, together with its successors and
permitted assigns.
"Assignment Amount" with respect to a Bank Investor shall mean at any time
an amount equal to the lesser of (i) such Bank Investor's Pro Rata Share of the
Net Investment held by the Conduit Investor in the same Related Group at such
time and (ii) such Bank Investor's unused Commitment.
"Assignment and Assumption Agreement" means an Assignment and Assumption
Agreement substantially in the form of Exhibit G attached hereto.
"Auditor" shall have the meaning specified in Section 6.2(c).
"Bank Investors" means each financial institution identified as a "Bank
Investor" on Schedule II and their respective successors and assigns.
"Bankruptcy Code" means the United States Bankruptcy Code, 11 U.S.C.
sec.101 et seq., as amended.
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"Base Rate" or "BR" means, with respect to the Investors in any Related
Group, a rate per annum equal to the greater of (i) the prime rate of interest
announced by the Administrative Agent for such Related Group from time to time,
changing when and as said prime rate changes (such rate not necessarily being
the lowest or best rate charged by such Administrative Agent) and (ii) the sum
of (a) 1.50% and (b) the rate equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of
New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such transactions
received by such Administrative Agent from three Federal funds brokers of
recognized standing selected by it.
"Bayerische Landesbank, Cayman Islands Branch" means Bayerische Landesbank,
Cayman Islands Branch, together with its successors and permitted assigns.
"BayernLB" means Bayerische Landesbank,
New York Branch, together with its
successors and permitted assigns.
"Benefit Plan" means any employee benefit plan as defined in Section 3(3)
of ERISA in respect of which the Transferor, the Seller or any ERISA Affiliate
of the Transferor or the Seller is, or at any time during the immediately
preceding six years was, an "employer" as defined in Section 3(5) of ERISA.
"BMA" means Bio-Medical Applications Management Company, Inc., a Delaware
corporation, and its successors and permitted assigns.
"BMA Transfer Agreement" means that certain Receivables Purchase Agreement
dated as of August 28, 1997 by and between BMA, as seller, and NMC, as
purchaser, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"Business Day" means any day excluding Saturday, Sunday and any day on
which banks in
New York,
New York or Charlotte, North Carolina are authorized or
required by law to close, and, when used with respect to the determination of
any Eurodollar Rate or any notice with respect thereto, any such day which is
also a day for trading by and between banks in United States dollar deposits in
the London interbank market.
"BR Tranche" means a Tranche as to which Discount is calculated at the Base
Rate.
"BR Tranche Period" means, with respect to a BR Tranche for the Investors
in any Related Group, either (i) prior to the Termination Date, a period of up
to 30 days requested by the Transferor and agreed to by the Administrative Agent
for such Related Group, commencing on a Business Day requested by the Transferor
and agreed to by such Administrative Agent, or (ii) after the Termination Date,
a period of one day. If such BR Tranche Period would end on a day which is not a
Business Day, such BR Tranche Period shall end on the next succeeding Business
Day.
"Capitalized Lease" of a Person means any lease of property by such Person
as lessee which would be capitalized on a balance sheet of such Person prepared
in accordance with GAAP.
"Certificate" means the certificate issued to the Agent for the benefit of
the Investors pursuant to Section 2.2(d) of the Existing TAA.
"CHAMPUS/VA" means, collectively, (i) the Civilian Health and Medical
Program of the Uniformed Service, a program of medical benefits covering
retirees and dependents of a member or a former member of a uniformed service,
provided, financed and supervised by the United States Department of Defense and
established by 10 USC sec.1071 et seq. and (ii) the Civilian Health and Medical
Program of Veterans Affairs, a program of medical benefits covering dependents
of veterans, administered by the United States Veterans' Administration and
Department of Defense and established by 38 USC sec.1713 et seq.
"CHAMPUS/VA Regulations" means collectively, all regulations of the
Civilian Health and Medical Program of the Uniformed Services and the Civilian
Health and Medical Program of Veterans Affairs, including (a) all federal
statutes (whether set forth in 10 USC 1071, 38 USC 1713 or elsewhere) affecting
CHAMPUS/VA; and (b) all applicable provisions of all rules, regulations
(including 32 CFR 199 and 38 CFR 17.54), manuals, orders, and administrative,
reimbursement and other guidelines of all Governmental Authorities (including,
3
without limitation, HHS, the Department of Defense, the Veterans'
Administration, the Department of Transportation, the Assistant Secretary of
Defense (Health Affairs), and the Office of CHAMPUS, or any Person or entity
succeeding to the functions of any of the foregoing) promulgated pursuant to or
in connection with any of the foregoing (whether or not having the force of
law), in each case as may be amended, supplemented or otherwise modified from
time to time.
"Closing Date" means October 23, 2003.
"CMS" means the Centers for Medicare and Medicaid Services (formerly known
as the Health Care Financing Administration), an agency of the HHS charged with
administering and regulating, among other things, certain aspects of Medicaid
and Medicare.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral Agent" means with respect to the Related Group that includes
Paradigm, WestLB AG (formerly known as Westdeutsche Landesbank Girozentrale), as
collateral agent for any related Liquidity Provider, any related Credit Support
Provider, the holders of Commercial Paper issued by Paradigm and certain other
parties.
"Collection Account" means the account, established by the Agent, for the
benefit of the Investors, pursuant to Section 2.12.
"Collection Agent" means at any time the Person then authorized pursuant to
Section 6.1 to service, administer and collect Receivables.
"Collection Agent Default" has the meaning specified in Section 6.4 hereof.
"Collections" means, with respect to any Receivable, all cash collections
and other cash proceeds of such Receivable, including, without limitation, all
Finance Charges, if any, and cash proceeds of Related Security with respect to
such Receivable.
"Collection Delay Period" means 10 days or such other number of days as the
Agent may select upon three Business Days' notice to the Transferor.
"Commercial Obligor" means any Obligor referred to in clause (C) or (E) of
the definition of "Obligor" contained in this Section 1.1 hereof.
"Commercial Paper" means, with respect to any Conduit Investor, the
promissory notes issued by such Conduit Investor in the commercial paper market.
"Commitment" means (i) with respect to each Bank Investor party hereto, the
agreement of such Bank Investor to make acquisitions from the Transferor or the
Conduit Investor in its Related Group in accordance herewith in an amount not to
exceed the dollar amount set forth opposite such Bank Investor's name on
Schedule II hereto under the heading "Commitment", minus the dollar amount of
any Commitment or portion thereof assigned pursuant to an Assignment and
Assumption Agreement plus the dollar amount of any increase to such Bank
Investor's Commitment consented to by such Bank Investor prior to the time of
determination, (ii) with respect to any assignee of a Bank Investor party hereto
taking pursuant to an Assignment and Assumption Agreement, the commitment of
such assignee to make acquisitions from the Transferor or the Conduit Investor
in its Related Group not to exceed the amount set forth in such Assignment and
Assumption Agreement minus the dollar amount of any Commitment or portion
thereof assigned pursuant to an Assignment and Assumption Agreement prior to
such time of determination and (iii) with respect to any assignee of an assignee
referred to in clause (ii), the commitment of such assignee to make acquisitions
from the Transferor or the Conduit Investor in its Related Group not to exceed
the amount set forth in an Assignment and Assumption Agreement between such
assignee and its assign.
"Commitment Termination Date" means October 21, 2004, or such later date to
which the Commitment Termination Date may be extended by Transferor, the Agent
and the Bank Investors.
"Concentration Account" means a special depositary account in the name of
the Transferor maintained at a bank acceptable to the Agent for the purpose of
receiving Collections remitted from the Special Accounts.
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"Concentration Account Agreement" means an agreement substantially in the
form attached as Exhibit D-2 hereto among the Transferor, the Concentration
Account Bank and the Agent.
"Concentration Account Bank" means the bank holding the Concentration
Account.
"Concentration Account Notice" means a notice, in substantially the form of
the Notice of Effectiveness attached to the Concentration Account Agreement,
from the Agent to the Concentration Account Bank.
"Concentration Factor" means for any Designated Obligor on any date of
determination (calculated prior to the payment of any Transfer Price to be made
on such date but as if such payment had been made):
(a) in the case of any Commercial Obligor or Hospital Obligor that
does not have a Special Concentration Limit (as defined below), 5% of the
Net Investment outstanding on such date; provided that, subject to clause
(c) below, the Concentration Factor for each of Aetna, Inc., Cigna Corp.,
and United Health Group Inc., and any successor thereto, shall be (i) for
so long as such Obligor is rated at least A- by Standard and Poor's and at
least A3 by Moody's and, at least A- by Fitch, 10% of the Net Investment
outstanding on such date and (ii) for so long as clause (i) does not apply
but such Obligor is rated at least BBB- by Standard and Poor's and at least
Baa3 by Moody's and, at least BBB- by Fitch, 7% of the Net Investment
outstanding on such date;
(b) in the case of any US Government Obligor that does not have a
Special Concentration Limit, 80% of the Net Investment outstanding on such
date; or
(c) in the case of any Obligor (including any Obligor described in
clauses (a) and (b)), such higher amount determined by the Agent (with the
consent of each Administrative Agent) or such lower amount determined by
any Administrative Agent in the reasonable exercise of its good faith
judgment and disclosed in a written notice delivered to the Transferor and
the other Administrative Agent (any such higher or lower amount being a
"Special Concentration Limit").
"Conduit Investor" means Paradigm, GMFC, Asset One or Liberty Street.
"Confidential Information" shall have the meaning specified in Section
5.1(d).
"Contract" means an agreement between an Originating Entity and an Obligor
which (i) if in writing, is in substantially the form of one of the forms of
written contract set forth in Exhibit A hereto or otherwise approved by each
Administrative Agent, and (ii) if an open account agreement, is evidenced by one
of the forms of invoices set forth in Exhibit A hereto or otherwise approved by
each Administrative Agent, in each case pursuant to or under which such Obligor
shall be obligated to pay for services or merchandise from time to time.
"Contractual Adjustment" means, with respect to any Receivable, an amount
by which the outstanding principal amount of such Receivable is reduced as a
result of (i) Medicare or Medicaid program funding and fee requirements or (ii)
any other reasonable and customary insurance company or other charge or
reimbursement policies or procedures.
"Contractual Adjustment Amount" means, with respect to any Receivable
originated by a member of the Spectra Renal Management Group, at any time, an
amount equal to (i) 75% of the original outstanding principal amount of such
Receivable (excluding any accrued and outstanding Finance Charges related
thereto) minus (ii) the amount of any Contractual Adjustments already granted
with respect to such Receivable.
"CP Rate" means, for any CP Tranche Period for any Conduit Investor, the
per annum rate equivalent to the weighted average cost (as determined by the
related Administrative Agent, and which shall include (without duplication) the
fees and commissions of placement agents and dealers, incremental carrying costs
incurred with respect to Commercial Paper maturing on dates other than those on
which corresponding funds are received by such Conduit Investor, other
borrowings by such Conduit Investor and any other costs associated with the
issuance of Commercial Paper) of or related to the issuance of Commercial Paper
that are allocated, in whole or in part, by such Conduit Investor or its related
Administrative Agent to fund or maintain the related Tranche during such CP
Tranche Period (and which may also be allocated in part to the funding of other
assets of the Conduit Investor); provided, however, that if any component of any
such rate is a discount rate, in calculating the "CP Rate" for such Tranche for
such CP Tranche Period, the related Administrative Agent shall for such
5
component use the rate resulting from converting such discount rate to an
interest bearing equivalent rate per annum.
"CP Tranche" means a Tranche as to which Discount is calculated at a CP
Rate.
"CP Tranche Period" means, with respect to a CP Tranche for any Conduit
Investor, (i) initially, the period commencing on (and including) the date such
CP Tranche is established and ending on (and including) the next succeeding CP
Tranche Period End Date, and (ii) thereafter, each successive period commencing
on (but excluding) a CP Tranche Period End Date and ending on (and including)
the next succeeding CP Tranche Period End Date; provided that, from and after
the Termination Date, each CP Tranche Period shall be such period as may be
selected pursuant to Section 2.3(b).
"CP Tranche Period End Date" means the last day of each calendar month.
"Credit and Collection Policy" shall mean the Transferor's credit and
collection policy or policies and practices, relating to Contracts and
Receivables existing on the date hereof and referred to in Exhibit B attached
hereto, as modified from time to time in compliance with Section 5.2(c).
"Credit Support Agreement" means, with respect to any Conduit Investor, an
agreement between such Conduit Investor and a Credit Support Provider evidencing
the obligation of such Credit Support Provider to provide credit support to such
Conduit Investor in connection with the issuance by such Conduit Investor of
Commercial Paper.
"Credit Support Provider" means, with respect to any Conduit Investor, the
Person or Persons who provides credit support to such Conduit Investor in
connection with the issuance by such Conduit Investor of Commercial Paper.
"Deemed Collections" means any Collections on any Receivable deemed to have
been received pursuant to Section 2.9(a) or (b) hereof.
"Defaulted Receivable" means a Receivable: (i) as to which any payment, or
part thereof, remains unpaid for over 270 days from the original due date when a
contract exists with an Originating Entity that is part of the dialysis products
division of the Parent Group and otherwise from the original invoice date for
such Receivable; (ii) as to which an Event of Bankruptcy has occurred and is
continuing with respect to the Obligor thereof; (iii) which has been identified
by the Transferor, any Originating Entity or the Collection Agent as
uncollectible (including, without limitation, any Receivable that is written off
by the Transferor, any Originating Entity or the Collection Agent); or (iv)
which, consistent with the Credit and Collection Policy, should be written off
as uncollectible.
"Default Ratio" means the ratio (expressed as a percentage) computed as of
the last day of each calendar month by dividing (i) the aggregate Outstanding
Balance of all Receivables that became Defaulted Receivables during such month
together with all Receivables under the Medicare or Medicaid Program that were
deemed disputed as provided for in the proviso to clause (xi) of the definition
of "Eligible Receivables" during such month, by (ii) the aggregate Outstanding
Balance of Receivables that shall have been acquired by the Seller during the
month occurring nine months prior to such calendar month.
"Delinquent Receivable" means a Receivable: (i) as to which any payment, or
part thereof, remains unpaid for more than 90 days from the original due date
when a contract exists with an Originating Entity that is part of the dialysis
products division of the Parent Group and otherwise from the original invoice
date for such Receivable and (ii) which is not a Defaulted Receivable.
"Designated Account Agent" means, in the case of any Originating Entity, an
Affiliate thereof that (i) is, directly or indirectly, a wholly-owned Subsidiary
of FMCH, (ii) has agreed to maintain a deposit account for the benefit of such
Originating Entity to which Obligors in respect of such Originating Entity have
been directed to remit payments on Receivables, and (iii) shall have executed
and delivered to the Agent an Account Agent Agreement.
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"Designated Obligor" means, at any time, each Obligor; provided, however,
that any Obligor shall cease to be a Designated Obligor upon notice to the
Transferor from any Administrative Agent, delivered at any time (with a copy to
the other Administrative Agents).
"Dilution Horizon" means the ratio (expressed as a percentage) computed as
of the last day of each calendar month by dividing (i) the aggregate Outstanding
Balance of all Receivables acquired by the Transferor during the calendar month
preceding such calendar month by (ii) the Net Receivables Balance as of such
last day of such calendar month.
"Dilution Ratio" means, with respect to any calendar month, the greater of
(a) the ratio (expressed as a percentage) computed as of the last day of such
calendar month by dividing (i) the aggregate amount of any reductions to or
cancellations of the respective Outstanding Balances of the Receivables as a
result of any defective, rejected or returned merchandise or services and all
credits, rebates, discounts, disputes, warranty claims, repossessed or returned
goods, chargebacks, allowances and any other billing and other adjustment
(whether effected through the granting of credits against the applicable
Receivables or by the issuance of a check or other payment in respect of (and as
payment for) such reduction) by the Seller, the Transferor or the Collection
Agent, provided to Obligors in respect of Receivables during such month,
excluding (x) volume rebates paid in cash by the Dialysis Products Division and
(y) credit memos for future purchases (it being understood and agreed that any
Receivables arising from such purchases will have an initial Outstanding Balance
that reflects such credit memos) by (ii) the aggregate Outstanding Balance of
all Receivables which arose during the preceding month and (b) 6.0%.
"Dilution Reserve" means, at any time, an amount equal to the product of
(i) the Dilution Reserve Percentage and (ii) the Net Receivables Balance on such
date.
"Dilution Reserve Percentage" means, on any day, an amount equal to:
[(1.5 X ADR) + [(DS - ADR) X (DS/ADR)]] X DH
Where:
ADR = the average Dilution Ratio in respect of the 12 calendar month period
then most recently ended.
DS = the highest Dilution Ratio at any time during the 12 calendar month
period then most recently ended.
DH = the Dilution Horizon on such date.
"Discount" means, with respect to any Tranche Period:
(TR X TNI X AD)
---
360
Where:
TR = the Tranche Rate applicable to such Tranche Period.
TNI = the portion of the Net Investment allocated to such Tranche Period.
AD = the actual number of days during such Tranche Period.
provided, however, that no provision of this Agreement shall require the payment
or permit the collection of Discount in excess of the maximum amount permitted
by applicable law; and provided, further, that Discount shall not be considered
paid by any distribution if at any time such distribution is rescinded or must
be returned for any reason.
"Discount Reserve" means, at any time, an amount equal to:
TD + LY
7
Where:
TD = the sum of the unpaid Discount for all Tranche Periods to which any
portion of the Net Investment is allocated.
LY = the Liquidation Yield.
"Early Collection Fee" means, for any Tranche Period (such Tranche Period
to be determined without regard to the last sentence in Section 2.3(a) hereof)
during which the portion of the Net Investment that was allocated to such
Tranche Period is reduced for any reason whatsoever, the excess, if any, of (i)
the additional Discount that would have accrued during such Tranche Period (or,
in the case of a CP Tranche Period, during the period until the maturity date of
the Commercial Paper allocated to fund or maintain such Net Investment) if such
reductions had not occurred, minus (ii) the income, if any, received by the
recipient of such reductions from investing the proceeds of such reductions.
"Effective Date" has the meaning specified in Section 1.4.
"Eligible Investments" means any of the following (a) negotiable
instruments or securities represented by instruments in bearer or registered or
in book-entry form which evidence (i) obligations fully guaranteed by the United
States of America; (ii) time deposits in, or bankers acceptances issued by, any
depositary institution or trust company incorporated under the laws of the
United States of America or any state thereof and subject to supervision and
examination by Federal or state banking or depositary institution authorities;
provided, however, that at the time of investment or contractual commitment to
invest therein, the certificates of deposit or short-term deposits, if any, or
long-term unsecured debt obligations (other than such obligation whose rating is
based on collateral or on the credit of a Person other than such institution or
trust company) of such depositary institution or trust company shall have a
credit rating from ▇▇▇▇▇'▇ and S&P of at least "P-1" and "A-1", respectively, in
the case of the certificates of deposit or short-term deposits, or a rating not
lower than one of the two highest investment categories granted by ▇▇▇▇▇'▇ and
by S&P; (iii) certificates of deposit having, at the time of investment or
contractual commitment to invest therein, a rating from ▇▇▇▇▇'▇ and S&P of at
least "P-1" and A-1", respectively; or (iv) investments in money market funds
rated in the highest investment category or otherwise approved in writing by the
applicable rating agencies; (b) demand deposits in any depositary institution or
trust company referred to in (a) (ii) above; (c) commercial paper (having
original or remaining maturities of no more than 30 days) having, at the time of
investment or contractual commitment to invest therein, a credit rating from
▇▇▇▇▇'▇ and S&P of at least "P-1" and "A-1", respectively; and (e) repurchase
agreements involving any of the Eligible Investments described in clauses
(a)(i), (a)(iii) and (d) hereof so long as the other party to the repurchase
agreement has at the time of investment therein, a rating from ▇▇▇▇▇'▇ and S&P
of at least "P-1" and "A-1", respectively.
"Eligible Receivable" means, at any time, any Receivable:
(i) which has been (A) originated by the Seller or a Transferring
Affiliate, (B) sold by the applicable Transferring Affiliate to the Seller
pursuant to (and in accordance with) the Transferring Affiliate Letter or
the BMA Transfer Agreement, free and clear of any Adverse Claim, in the
case of a Receivable originated by a Transferring Affiliate, and (C) sold
to the Transferor pursuant to (and in accordance with) the Receivables
Purchase Agreement, with the effect that the Transferor has good title
thereto, free and clear of all Adverse Claims;
(ii) which (together with the Collections and Related Security related
thereto) has been the subject of either a valid transfer and assignment
from the Transferor to the Agent, on behalf of the Investors, of all of the
Transferor's right, title and interest therein or the grant of a first
priority perfected security interest herein (and in the Collections and
Related Security related thereto), effective until the termination of this
Agreement;
(iii) the Obligor of which (A) is a United States resident, (B) is a
Designated Obligor at the time of the initial creation of an interest
therein hereunder, (C) is not an Affiliate of any Originating Entity or any
of the parties hereto, and (D) other than in the case of any Obligor of the
type described in clause (A), (B) or (F) of the definition herein of
"Obligor", is not a government or a governmental subdivision or agency;
8
(iv) which is not a Defaulted Receivable at the time of the initial
creation of an interest therein hereunder;
(v) which is not a Delinquent Receivable at the time of the initial
creation of an interest of the Agent or any Investor therein;
(vi) which, (A) arises pursuant to a Contract with respect to which
each of the Seller and the Transferor has performed all material
obligations required to be performed by it thereunder, including without
limitation shipment of the merchandise and/or the performance of the
services purchased thereunder; (B) has been billed in accordance with the
Credit and Collection Policy and in accordance with such requirements
(including any requirements that relate to the timing of billing) as may
have been imposed by the applicable Obligor thereon (including, without
limitation, any Official Body associated with any of the CHAMPUS/VA,
Medicaid or Medicare programs); and (C) according to the Contract related
thereto, is required to be paid in full upon receipt by the Obligor thereof
of the invoice related thereto or at a later time not to exceed 90 days
from the original billing date therefor;
(vii) which is an "eligible asset" as defined in Rule 3a-7 under the
Investment Company Act of 1940, as amended;
(viii) a purchase of which with the proceeds of Commercial Paper would
constitute a "current transaction" within the meaning of Section 3(a)(3) of
the Securities Act of 1933, as amended;
(ix) which is an "account" or "general intangible" within the meaning
of Article 9 of the UCC of all applicable jurisdictions;
(x) which is denominated and payable only in United States dollars in
the United States;
(xi) which, to the knowledge of the Transferor, the Seller and the
applicable Transferring Affiliate, after due enquiry in accordance with
customary practice, (A) arises under a Contract that has been duly
authorized and that, together with the Receivable related thereto, 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, (B) is not subject to any litigation, dispute,
counterclaim or other defense and (C) is not subject to any offset other
than as set forth in the related Contract; provided, however, that for the
purposes of this clause (xi), any Receivable under the Medicare, Medicaid
or CHAMPUS/VA program as to which any payment, or part thereof, remains
unpaid for 270 days or more from the original invoice date shall be deemed
to be a disputed Receivable and, further, any Receivable, for which the
Transferor receives a partial payment that is below the estimated value of
such Receivable, net of Contractual Adjustments, shall be deemed to be a
disputed Receivable;
(xii) which, together with the Contract related thereto, does not
contravene in any material respect any laws, rules or regulations
applicable thereto (including, without limitation, (A) laws, rules and
regulations relating to healthcare, insurance, usury, consumer protection,
truth in lending, fair credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices and privacy and (B) CHAMPUS/VA
Regulations, Medicare Regulations and Medicaid Regulations) and with
respect to which no part of the Contract related thereto is or would, as a
result of any of the transactions contemplated herein, be in violation of
any such law, rule or regulation in any material respect and with respect
to which no Originating Entity or the Transferor, and to the best knowledge
of the Seller and the Transferor, no other party to the Contract related
thereto, is in violation of any such law, rule or regulation in any
material respect;
(xiii) which (A) satisfies in all material respects all applicable
requirements of the Credit and Collection Policy, (B) is assignable as
contemplated under the Transaction Documents, and (C) complies with such
other criteria and requirements as any Administrative Agent may from time
to time specify to the Transferor following five Business Days' notice;
(xiv) which was generated in the ordinary course of an Originating
Entity's business;
(xv) the Obligor of which has been directed to make all payments to a
Special Account with respect to which there shall be a Special Account
Letter (and, if applicable, an Account Agent Agreement) in effect;
9
(xvi) neither the assignment of which under the Transferring Affiliate
Letter or the BMA Transfer Agreement by the applicable Transferring
Affiliate, the assignment of which under the Receivables Purchase Agreement
by the Seller and the assignment of which hereunder by the Transferor nor
the performance or execution of any of the other transactions contemplated
in any of the Transaction Documents with respect thereto violates,
conflicts or contravenes any applicable laws, rules or regulations
(including without limitation, any CHAMPUS/VA Regulations, any Medicaid
Regulations and any Medicare Regulations), orders or writs or any
contractual or other restriction, limitation or encumbrance;
(xvii) which has not been compromised, adjusted or modified (including
by the extension of time for payment or the granting of any discounts,
allowances or credits); provided, however, that only such portion of such
Receivable that is the subject of such compromise, adjustment or
modifications shall be deemed to be ineligible pursuant to the terms of
this clause (xvii);
(xviii) which, in the case of any Receivable payable by an Obligor
through a fiscal intermediary or similar entity, is payable through one of
the Persons in such capacity that is specified in Exhibit N hereto or that
has otherwise been approved by each Administrative Agent; and
(xix) as to which, in the case of any Obligor of the type described in
clause (C) or (D) of the definition of "Obligor" herein, notice of the
interest therein of the Transferor shall have been given to such Obligor.
"ERISA" means the U.S. Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means, with respect to any Person, (i) any corporation
which is a member of the same controlled group of corporations (within the
meaning of Section 414(b) of the Code (as in effect from time to time, the
"Code")) as such Person; (ii) a trade or business (whether or not incorporated)
under common control (within the meaning of Section 414(c) of the Code) with
such Person; or (iii) a member of the same affiliated service group (within the
meaning of Section 414(n) of the Code) as such Person, any corporation described
in clause (i) above or any trade or business described in clause (ii) above.
"Estimated Maturity Period" shall mean, at any time, the period, rounded
upward to the nearest whole number of days, equal to the weighted average number
of days until due of the Receivables as calculated by the Collection Agent in
good faith and set forth in the most recent Investor Report, such calculation to
be based on the assumptions that (a) each Receivable within a particular aging
category (as set forth in the Investor Report) will be paid on the last day of
such aging category and (b) the last day of the last such aging category
coincides with the last date on which any Outstanding Balance of Receivables
would be written off as uncollectible or charged against any applicable reserve
or similar account in accordance with the objective requirements of the Credit
and Collection Policy and the Seller's and the Transferor's normal accounting
practices applied on a basis consistent with those reflected in the Seller's
financial statements, provided, however, that if the Agent, any Administrative
Agent or any Investor shall reasonably disagree with any such calculation, the
Agent may recalculate the Estimated Maturity Period, and such recalculation, in
the absence of manifest error, shall be conclusive.
"Eurodollar Rate" means, with respect to any Eurodollar Tranche Period for
the Investors in any Related Group, a rate which is equal to the sum (rounded
upwards, if necessary, to the next higher 1/100 of 1%) of (A) the Applicable
Margin at such time, (B) the rate obtained by dividing (i) the applicable LIBOR
Rate by (ii) a percentage equal to 100% minus the reserve percentage used for
determining the maximum reserve requirement as specified in Regulation D
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves) that is applicable to the Administrative Agent for such
Related Group during such Eurodollar Tranche Period in respect of eurocurrency
or eurodollar funding, lending or liabilities (or, if more than one percentage
shall be so applicable, the daily average of such percentage for those days in
such Eurodollar Tranche Period during which any such percentage shall be
applicable) plus (C) the then daily net annual assessment rate (rounded upwards,
if necessary, to the nearest 1/100 of 1%) as estimated by such Administrative
Agent for determining the current annual assessment payable by such
Administrative Agent to the Federal Deposit Insurance Corporation in respect of
eurocurrency or eurodollar funding, lending or liabilities.
"Eurodollar Tranche" means a Tranche as to which Discount is calculated at
the Eurodollar Rate.
10
"Eurodollar Tranche Period" means, with respect to a Eurodollar Tranche for
the Investors in any Related Group, prior to the Termination Date, a period of
up to one month requested by the Transferor and agreed to by the Administrative
Agent for such Related Group, commencing on a Business Day requested by the
Transferor and agreed to by such Administrative Agent; provided, however, that
if such Eurodollar Tranche Period would expire on a day which is not a Business
Day, such Eurodollar Tranche Period shall expire on the next succeeding Business
Day; provided, further, that if such Eurodollar Tranche Period would expire on
(a) a day which is not a Business Day but is a day of the month after which no
further Business Day occurs in such month, such Eurodollar Tranche Period shall
expire on the next preceding Business Day or (b) a Business Day for which there
is no numerically corresponding day in the applicable subsequent calendar month,
such Eurodollar Tranche Period shall expire on the last Business Day of such
month.
"Event of Bankruptcy" means, with respect to any Person, (i) that such
Person (a) shall generally not pay its debts as such debts become due or (b)
shall admit in writing its inability to pay its debts generally or (c) shall
make a general assignment for the benefit of creditors; (ii) any proceeding
shall be instituted by or against such Person seeking to adjudicate it as
bankruptcy or insolvent, or seeking liquidation, winding up, reorganization,
arrangements, 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) if such Person is a corporation (or other business
entity), such Person or any Subsidiary shall take any corporate (or analogous)
action to authorize any of the actions set forth in the preceding clauses (i) or
(ii).
"Excluded Taxes" shall have the meaning specified in Section 8.3 hereof.
"Existing TAA" shall have the meaning specified in the Preliminary
Statements hereof.
"Face Amount" means, with respect to any Commercial Paper, (i) the face
amount of any such Commercial Paper issued on a discount basis and (ii) the
principal amount of, plus the amount of all interest accrued and to accrue
thereon to the stated maturity date of, any such Commercial Paper issued on an
interest-bearing basis.
"Facility Fee" means, with respect to any Conduit Investor, a fee payable
by the Transferor to such Conduit Investor pursuant to Section 2.7(ii) hereof,
the terms of which are set forth in the Investor Fee Letter.
"Facility Limit" means $460,000,000; provided that such amount may not at
any time exceed the aggregate Commitments at any time in effect.
"Fee Letter" means the Investor Fee Letter or the Agent Fee Letter.
"Finance Charges" means, with respect to a Contract, any finance, interest,
late or similar charges owing by an Obligor pursuant to such Contract.
"FMCAG" means Fresenius Medical Care AG, a corporation organized and
existing under the laws of the Federal Republic of Germany, and its successors
and permitted assigns.
"FMCAG Bank Revolver" means the Amended and Restated Credit Agreement dated
as of February 21, 2003 among FMCAG, FMCH and FMC FINANCE II S.a.r.l., as
borrowers, the guarantors party thereto, the lenders party thereto, and Bank of
America, N.A., as Administrative Agent together with all amendments thereto
through the date hereof.
"FMCH" means Fresenius Medical Care Holdings, Inc., a
New York corporation,
and its successors and permitted assigns.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
accounting profession, which are in effect as of the date of this Agreement.
"GMFC" means Giro Multi-Funding Corporation, a bankruptcy-remote special
purpose company incorporated in Delaware, together with its successors and
permitted assigns.
"Group Majority Investors" has the meaning specified in Section 9.8.
11
"Guaranty" means, with respect to any Person any agreement by which such
Person assumes, guarantees, endorses, contingently agrees to purchase or provide
funds for the payment of, or otherwise becomes liable upon, the obligation of
any other Person, or agrees to maintain the net worth or working capital or
other financial condition of any other Person or otherwise assures any other
creditor of such other Person against loss, including, without limitation, any
comfort letter, operating agreement or take-or-pay contract and shall include,
without limitation, the contingent liability of such Person in connection with
any application for a letter of credit.
"HHS" means the Department of Health and Human Services, an agency of the
Federal Government of the United States.
"Hospital Obligor" means any Obligor referred to in clause (D) of the
definition of "Obligor" contained in this Section 1.1 hereof.
"Incremental Transfer" means a Transfer upon giving effect to which the Net
Investment hereunder shall be increased.
"Indebtedness" means, with respect to any Person and without duplication,
such Person's (i) obligations for borrowed money, (ii) obligations representing
the deferred purchase price of property other than accounts payable arising in
the ordinary course of such Person's business 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 and (vi) obligations for
which such Person is obligated pursuant to a Guaranty.
"Indemnified Amounts" has the meaning specified in Section 8.1 hereof.
"Indemnified Parties" has the meaning specified in Section 8.1 hereof.
"Initial Transfer Documents" shall have the meaning specified in Section
5.2(h).
"Interest Component" shall mean, (i) with respect to any Commercial Paper
issued on an interest-bearing basis, the interest payable on such Commercial
Paper at its maturity (including any dealer commissions) and (ii) with respect
to any Commercial Paper issued on a discount basis, the portion of the face
amount of such Commercial Paper representing the discount incurred in respect
thereof (including any dealer commissions).
"Investor" means a Conduit Investor or a Bank Investor.
"Investor Fee Letter" means the letter agreement dated as of the Closing
Date among the Transferor and the Administrative Agents relating to certain fees
payable by the Transferor to the Administrative Agents, for the account of the
Investors in their respective Related Groups, as amended, restated, supplemented
or otherwise modified from time to time.
"Investor Report" means a report, in substantially the form attached hereto
as Exhibit E or in such other form as is mutually agreed to by the Transferor
and each Administrative Agent, furnished by the Collection Agent pursuant to
Section 2.11 hereof.
"Law" means any law (including common law), constitution, statute, treaty,
regulation, rule, ordinance, order, injunction, writ, decree or award of any
Official Body.
"Liberty Street" means Liberty Street Funding Corp., a Delaware
corporation, together with its successors and permitted assigns.
"LIBOR Rate" means, with respect to any Eurodollar Tranche Period for the
Investors in any Related Group, the rate at which deposits in dollars are
offered to the Administrative Agent for such Related Group, in the London
interbank market at approximately 11:00 a.m. (London time) two Business Days
before the first day of such Eurodollar Tranche Period in an amount
approximately equal to the Eurodollar Tranche to which the Eurodollar Rate is to
apply and for a period of time approximately equal to the applicable Eurodollar
Tranche Period.
12
"Liquidation Yield" means, at any time, an amount equal to:
(RVF X LBR X NI) (EMP + CDF)
X
------------
360
Where:
RVF = the Rate Variance Factor at such time;
the Base Rate at such time which is applicable to the
LBR = liquidation period after a Termination Event;
NI = the Net Investment at such time;
EMP = the Estimated Maturity Period of the Receivables; and
CDF = the Collection Delay Factor.
"Liquidity Provider" means, with respect to any Conduit Investor, the
Person or Persons who will provide liquidity support to such Conduit Investor in
connection with the issuance by such Conduit Investor of Commercial Paper.
"Liquidity Provider Agreement" means an agreement between a Conduit
Investor and one or more Liquidity Providers evidencing the obligation of each
such Liquidity Provider to provide liquidity support to such Conduit Investor in
connection with the issuance by such Conduit Investor of Commercial Paper.
"Loss Horizon" means, as of any date, the product of (a) a ratio (expressed
as a percentage) computed by dividing (i) the aggregate Outstanding Balance of
all Receivables acquired by the Seller during the nine most recently ended
calendar months by (ii) the aggregate Outstanding Balance of all Receivables
that are not more than 270 days past due as of the last day of the most recently
ended calendar month times (b) the highest average Default Ratio for any
consecutive three month period during the immediately preceding 12-month period.
"Loss Percentage" means on any day the greater of (i) one and one-half
(1.5) times the Loss Horizon as of such day and (ii) 20%.
"Loss Reserve" means, on any day, an amount equal to:
LP X (NI + DLR + DR + SFR)
Where:
the Loss Percentage at the close of business of the
LP = Collection Agent on such day;
the Net Investment at the close of business of the
NI = Collection Agent on such day;
the Dilution Reserve at the close of business of the
DLR = Collection Agent on such day;
the Discount Reserve at the close of business of the
DR = Collection Agent on such day;
the Servicing Fee Reserve at the close of business of the
SFR = Collection Agent on such day.
"Loss-to-Liquidation Ratio" means the ratio (expressed as a percentage)
computed as of the last day of each calendar month by dividing (i) the aggregate
Outstanding Balance of all Receivables which became Defaulted Receivables during
such month, by (ii) the aggregate amount of Collections received by the
Collection Agent during such period.
"Majority Investors" means, at any time, those Investors which hold
Commitments aggregating in excess of 51% of the aggregate Commitments of all
Investors as of such date.
"Material Adverse Effect" means a material adverse effect on any of (i) the
collectibility or enforceability of a material portion of the Receivables or
Related Security, (ii) the ability of the Transferor or any Originating Entity
to charge or collect a material portion of the Receivables or Related Security,
(iii) the ability of (A) the Transferor or any Originating Entity to perform or
observe in any material respect any provision of this Agreement or any other
Transaction Document to which it is a party or (B) of FMCAG or FMCH to cause the
due and punctual performance and observation by the Seller or the Transferor of
any such provision or, if the Seller or the Transferor shall fail to do so, to
perform or observe any such provision required to be performed or observed by
the Seller or the Transferor under this Agreement or any other Transaction
Document to which the
13
Seller or the Transferor is party, in each case pursuant to the Parent
Agreement, (iv) the ability of (A) any Transferring Affiliate to perform or
observe in any material respect any provision of the Transferring Affiliate
Letter or, in the case of BMA, the BMA Transfer Agreement or, in the case of any
Designated Account Agent, the applicable Account Agent Agreement, or (B) of
FMCAG or FMCH to cause the due and punctual performance and observation by such
Transferring Affiliate, BMA or such Designated Account Agent of any such
provision or, if such Transferring Affiliate, BMA or such Designated Account
Agent shall fail to do so, to perform or observe any such provision, in each
case pursuant to the Parent Agreement, (v) the financial condition, operations,
businesses or properties, each on a consolidated basis, of FMCAG, FMCH, NMC or
the Transferor or (vi) the interests of the Agent, any Administrative Agent or
any of the Investors under the Transaction Documents.
"Maximum Net Investment" means at any time, an amount equal to 98% of the
Facility Limit in effect at such time.
"Maximum Percentage Factor" means 98%.
"Medicaid" means the medical assistance program established by Title XIX of
the Social Security Act (42 USC sec.sec.1396 et seq.) and any statutes
succeeding thereto.
"Medicaid Regulations" means, collectively, (a) all federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting Medicaid; (b) all state statutes and plans for medical assistance
enacted in connection with such statutes and federal rules and regulations
promulgated pursuant to or in connection with such statutes; and (c) all
applicable provisions of all rules, regulations manuals, orders and
administrative, reimbursement and other guidelines of all Governmental
Authorities (including, without limitation, HHS, CMS, the office of the
Inspector General for HHS, or any Person succeeding to the functions of any of
the foregoing) promulgated pursuant to or in connection with any of the
foregoing (whether or not having the force of law), in each case as may be
amended, supplemented or otherwise modified from time to time.
"Medicare" means the health insurance program for the aged and disabled
established by Title XVIII of the Social Security Act (42 USC sec.sec.1395 et
seq.) and any statutes succeeding thereto.
"Medicare Regulations" means, collectively, (a) all federal statutes
(whether set forth in Title XVIII of the Social Security Act or elsewhere)
affecting Medicare; and (b) all applicable provisions of all rules, regulations,
manuals, orders and administrative, reimbursement and other guidelines of all
Governmental Authorities (including, without limitation, HHS, CMS, the Office of
the Inspector General for HHS, or any Person succeeding to the functions of any
of the foregoing) promulgated pursuant to or in connection with the foregoing
(whether or not having the force of law), as each may be amended, supplemented
or otherwise modified from time to time.
"Minimum Amount" shall have the meaning specified in Section 5.1(h).
"Moody's" means ▇▇▇▇▇'▇ Investors Service.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA which is or was at any time during the current year or the
immediately preceding five years contributed to by the Transferor, the Seller or
any ERISA Affiliate of the Transferor or the Seller on behalf of its employees.
"Net Asset Test" shall mean, in connection with any assignment by a Conduit
Investor of an interest in the Net Investment pursuant to Section 9.7 hereof,
that on the day immediately prior to the day on which such assignment is to take
effect, the Net Receivables Balance shall be greater than the Net Investment.
"Net Investment" means the sum of the cash amounts paid to the Transferor
for each Incremental Transfer less the aggregate amount of Collections received
and applied by the Agent to reduce such Net Investment pursuant to Section 2.5,
2.6 or 2.9 hereof; provided that the Net Investment shall be restored and
reinstated in the amount of any Collections so received and applied if at any
time the distribution of such Collections is rescinded or must otherwise be
returned for any reason; and provided further that the Net Investment may be
increased by the amount described in Section 9.7(d) as described therein. A
portion of the Net Investment shall be deemed to
14
be held by an Investor to the extent such portion of the Net Investment shall
have been funded by, or assigned to, such Investor.
"Net Receivables Balance" means at any time the Outstanding Balance of the
Eligible Receivables at such time reduced, without duplication, by the sum of
(i) the aggregate amount by which the Outstanding Balance of all Eligible
Receivables of each Designated Obligor or class of Designated Obligors exceeds
the Concentration Factor for such Designated Obligor or class of Designated
Obligors, plus (ii) the aggregate Outstanding Balance of all Eligible
Receivables which are Defaulted Receivables, plus (iii) the excess, if any, of
(A) the aggregate Outstanding Balance of all Eligible Receivables of each
Obligor referred to in clause (G) of the definition of "Obligor" contained in
this Section 1.1, over (B) an amount equal to 5% of the aggregate Outstanding
Balance of all Eligible Receivables, plus (iv) the aggregate amount by which the
Outstanding Balance of all Eligible Receivables originated by any member of the
Spectra Renal Management Group exceeds 7.5% of the Net Investment, plus (v) the
Unrealized Contractual Adjustment Reserve.
"NMC" means National Medical Care, Inc., a Delaware corporation and owner
of 100% of the outstanding stock of the Transferor.
"NPRBI" shall have the meaning specified in Section 2.13.
"Obligor" of any Receivable means (i) any Person obligated to make payments
of such Receivable pursuant to a Contract and/or (ii) any Person owing any
amount in respect of such Receivable, or in respect of any Related Security with
respect to such Receivable, all such Persons referred to in any of clauses (A),
(B), (E), (F) and (G) below, and each Person referred to in any of clauses (C)
and (D) below, to be deemed for purposes of this Agreement to be one Obligor:
(A): all Persons owing Receivables or Related Security under the
Medicare program;
(B): all Persons owing Receivables or Related Security under the
Medicaid program;
(C): each Person which is an insurance company;
(D): each Person which is a hospital or other health care provider;
(E): all Persons, other than health care providers or Persons referred
to in clause (A), (B), (C) or (D) above or clause (F) or (G) below, owing
Receivables arising from the sale of services or merchandise;
(F): all Persons owing Receivables or Related Security under the
CHAMPUS/VA Program; and
(G): all Persons who receive the services or merchandise the sale of
which results in Receivables that are not insured, guaranteed or otherwise
supported in respect thereof by any of the Persons referred to in clauses
(A) through (F) above, including any Person owing any amount in respect of
Receivables by reason of insurance policy deductibles or co-insurance
agreements or arrangements.
"Official Body" means any government or political subdivision or any
agency, authority, bureau, central bank, commission, department or
instrumentality of any such government or political subdivision, or any court,
tribunal, grand jury or arbitrator, or any accounting board or authority
(whether or not a part of government) which is responsible for the establishment
or interpretation of national or international accounting principles in each
case whether foreign or domestic.
"Originating Entity" means any of the Seller and any Transferring
Affiliate.
"Other Transferor" means, with respect to any Conduit Investor, any Person
other than the Transferor that has entered into a receivables purchase agreement
or
transfer and administration agreement with such Conduit Investor.
"Outstanding Balance" means (i) with respect to any Receivable originated
by a member of the Spectra Renal Management Group, the outstanding principal
amount thereof (excluding any accrued and outstanding Finance Charges related
thereto) minus the Contractual Adjustment Amount with respect to such Receivable
and (ii) with respect to any other Receivable, the outstanding principal amount
thereof (excluding any accrued and outstanding Finance Charges related thereto).
15
"Paradigm" means, Paradigm Funding LLC, a Delaware limited liability
company, together with its successors and permitted assigns.
"Parent Agreement" means an agreement substantially in the form set forth
as Exhibit P hereto dated as of August 28, 1997 made by FMCAG and FMCH in
respect of the obligations of the Originating Entities and NMC under the
Transaction Documents, as the same may be amended, restated, supplemented or
otherwise modified from time to time with the consent of each Administrative
Agent.
"Parent Group" means, collectively, FMCAG, FMCH, NMC, the Transferor, the
Originating Entities and their Subsidiaries and Affiliates, and "Parent Group
Member" means any such Person individually.
"Payor" shall, solely for purposes of Section 8.3, have the meaning
specified in such section.
"Percentage Factor" shall mean the fraction (expressed as a percentage)
computed at any time of determination as follows:
NI + LR+ DLR + DR + SFR
------------------------------
NRB
Where:
NI = the Net Investment at the time of such computation;
LR = the Loss Reserve at the time of such computation;
DLR = the Dilution Reserve at the time of such computation;
DR = the Discount Reserve at the time of such computation;
SFR = the Servicing Fee Reserve at the time of such computation; and
NRB = the Net Receivables Balance at the time of such computation.
"Person" means any corporation, limited liability company, natural person,
firm, joint venture, partnership, trust, unincorporated organization,
enterprise, government or any department or agency or any government.
"Potential Termination Event" means an event which but for the lapse of
time or the giving of notice, or both, would constitute a Termination Event.
"Primary Payor" means (i) each Obligor referred to in clauses (A), (B),
(E), (F) and (G) of the definition of "Obligor" contained in this Section 1.1,
(ii) collectively, all Obligors of the type referred to in clause (C) of the
definition of "Obligor" contained in this Section 1.1 and (iii) collectively,
all Obligors of the type referred to in clause (D) of the definition of
"Obligor" contained in this Section 1.1.
"Pro Rata Share" means, for a Bank Investor in any Related Group, the
Commitment of such Bank Investor divided by the sum of the Commitments of all
Bank Investors in such Related Group.
"Proceeds" means "proceeds" as defined in Section 9-306 (1) of the UCC as
in effect on the date hereof.
"Program Fee" means, with respect to any Conduit Investor, the fee payable
by the Transferor to such Conduit Investor pursuant to Section 2.7(i) hereof,
the terms of which are set forth in the Investor Fee Letter.
"Purchased Interest" means the interest in the Receivables acquired by a
Liquidity Provider from a Conduit Investor through purchase pursuant to the
terms of a Liquidity Provider Agreement.
"Purchase Termination Date" means the date upon which the Transferor shall
cease, for any reason whatsoever, to make purchases of Receivables from the
Seller under the Receivables Purchase Agreement or the Receivables Purchase
Agreement shall terminate for any reason whatsoever.
"Ratable Share" means (i) in the case of a Conduit Investor in any Related
Group, a fraction (expressed as a percentage) equal to the Related Group Limit
of such Related Group divided by the Facility Limit and (ii) in the case of a
Bank Investor, a fraction (expressed as a percentage) equal to such Bank
Investor's Commitment
16
divided by the sum of the Commitments of all Bank Investors (including Bank
Investors from other Related Groups).
"Rate Variance Factor" means the number, computed from time to time in good
faith by the Agent (with the written consent of each Administrative Agent), that
reflects the largest potential variance (from minimum to maximum) in selected
interest rates over a period of time selected by the Agent from time to time,
set forth in written notice by the Agent to each Administrative Agent, the
Transferor and the Collection Agent.
"Rating Agency" means, at any time, Moody's, S&P or any other rating agency
chosen by a Conduit Investor to rate its commercial paper notes at such time.
"Receivable" means the indebtedness of any Obligor under a Contract and
sold by the Seller to the Transferor pursuant to the Receivables Purchase
Agreement, whether constituting an account, chattel paper, instrument, insurance
claim, investment property or general intangible, arising in connection with the
sale or lease of merchandise, or the rendering of services, by an Originating
Entity, and includes the right to payment of any Finance Charges and other
obligations of such Obligor with respect thereto.
"Receivable Systems" has the meaning specified in Section 3.1(aa).
"Receivables Purchase Agreement" means the Receivables Purchase Agreement
dated as of August 28, 1997 by and between NMC, as seller, and the Transferor,
as purchaser, as such agreement may be amended, modified or supplemented and in
effect from time to time.
"Recipient" shall, solely for purposes of Section 8.3, have the meaning
specified in such section.
"Records" means all Contracts and other documents, books, records and other
information (including, without limitation, computer programs, tapes, discs,
punch cards, data processing software and related property and rights)
maintained with respect to receivables and the related Obligors.
"Reinvestment Termination Date" means, with respect to any Conduit
Investor, the second Business Day after the delivery by such Conduit Investor to
the Transferor of written notice that such Conduit Investor elects to commence
the amortization of its interest in the Net Investment or otherwise liquidate
its interest in the Transferred Interest.
"Reinvestment Transfer" means a Transfer occurring in connection with the
reinvestment of Collections pursuant to Section 2.2(b) and 2.5.
"Related Group" means any of the following groups: (i) Paradigm, as a
Conduit Investor, Landesbank Hessen-Thueringen Girozentrale, as a Bank Investor
and WestLB, as a Bank Investor and as an Administrative Agent, together with
their respective successors and permitted assigns, (ii) GMFC, as a Conduit
Investor, and Bayerische Landesbank, Cayman Island Branch, as a Bank Investor
and BayernLB, as an Administrative Agent, together with their respective
successors and permitted assigns, (iii) Asset One, as a Conduit Investor, and
Societe Generale, as a Bank Investor and as Administrative Agent, together with
their respective successors and permitted assigns and (iv) Liberty Street, as a
Conduit Investor, and Scotiabank, as a Bank Investor and as Administrative
Agent, together with their respective successors and permitted assigns.
"Related Group Limit" means, with respect to any Related Group, the
aggregate Commitments of the Bank Investors in such Related Group.
"Related Security" means with respect to any Receivable, all of the
Transferor's rights, title and interest in, to and under:
(i) all of the Seller's, the Transferor's or any Transferring
Affiliate's interest, if any, in the merchandise (including returned or
repossessed merchandise), if any, the sale of which gave rise to such
Receivable;
(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 signed by an Obligor
describing any collateral securing such Receivable;
17
(iii) all guarantees, indemnities, warranties, insurance (and proceeds
and premium refunds thereof) or other agreements or arrangements of any
kind from time to time supporting or securing payment of such Receivable
whether pursuant to the Contract related to such Receivable or otherwise,
including, without limitation, insurance, guaranties and other agreements
or arrangements under the Medicare program, the Medicaid program, state
renal programs, CHAMPUS/VA, private insurance policies, and hospital and
other health care programs and health care provider arrangements;
(iv) all Records related to such Receivable;
(v) all rights and remedies of the Transferor (A) under the
Receivables Purchase Agreement, together with all financing statements
filed by the Transferor against the Seller in connection therewith, (B)
under the Transferring Affiliate Letter, together with all financing
statements filed in connection therewith against the Transferring
Affiliates, (C) under the BMA Transfer Agreement, together with all
financing statements filed in connection therewith against BMA and (D)
under the Parent Agreement; and
(vi) all Proceeds of any of the foregoing.
"Scotiabank" means The Bank of Nova Scotia, together with its successors
and permitted assigns.
"Section 8.2 Costs" has the meaning specified in Section 8.2(d) hereof.
"Seller" means NMC and its successors and permitted assigns.
"Servicing Fee" means the fees payable by the Investors in a Related Group
to the Collection Agent, with respect to a Tranche held by the Investors in such
Related Group, in an amount equal to 0.25% per annum on the amount of the Net
Investment allocated to such Tranche pursuant to Section 2.3 hereof. Such fee
shall accrue from the date of the initial purchase of an interest in the
Receivables to the date on which the Percentage Factor is reduced to zero. Such
fee shall be payable only from Collections pursuant to, and subject to the
priority of payments set forth in, Section 2.5 hereof. After the Termination
Date, such fee shall be payable only from Collections pursuant to, and subject
to the priority of payments set forth in, Section 2.6 hereof.
"Servicing Fee Reserve" means at any time an amount equal to the product of
(i) the aggregate Outstanding Balance of all Receivables at such time, (ii) the
Servicing Fee percentage and (iii) a fraction having as the numerator, the sum
of (a) the Estimated Maturity Period plus (b) the Collection Delay Period, and
as the denominator, 360.
"SG" means Societe Generale together with its successors and permitted
assigns.
"Social Security Act" means the Social Security Act, as amended from time
to time, and the regulations promulgated and rulings and advisory opinions
issued thereunder.
"Special Account" means a special depositary account maintained at a bank
acceptable to the Agent for the purpose of receiving Collections, which account
is in the name of either (i) the Originating Entity in respect of the
Receivables giving rise to such Collections or (ii) a Designated Account Agent
acting on behalf of such Originating Entity.
"Special Account Bank" means any of the banks holding one or more Special
Accounts.
"Special Account Letter" means a letter, in substantially the form of
Exhibit D-1 hereto, from an Originating Entity (or, if applicable, a Designated
Account Agent) to any Special Account Bank, executed by such Originating Entity
(or such Designated Account Agent) to such Special Account Bank.
"Spectra Renal Management Group" means, collectively, Spectra East, Inc., a
Delaware corporation, Spectra Laboratories, Inc., a Nevada corporation, as
Transferring Affiliates, and their respective successors.
"Standard & Poor's" or "S&P" means Standard & Poor's Ratings Services, a
division of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Subordinated Note" shall have the meaning specified in the Receivables
Purchase Agreement.
18
"Subsidiary" of a Person means any Person more than 50% of the outstanding
voting interests of which shall at any time be owned or controlled, directly or
indirectly, by such Person or by one or more Subsidiaries of such Person or any
similar business organization which is so owned or controlled.
"Taxes" shall have the meaning specified in Section 8.3 hereof.
"Termination Date" means the earliest of (i) the Business Day designated by
the Transferor to each Administrative Agent as the Termination Date at any time
following 60 days' written notice to each Administrative Agent, (ii) the day
upon which the Termination Date is declared or automatically occurs pursuant to
Section 7.2(a) hereof, (iii) two Business Days prior to the Commitment
Termination Date, (iv) the Purchase Termination Date, or (v) October 21, 2004.
"Termination Event" means an event described in Section 7.1 hereof.
"Tranche" means a portion of the Net Investment allocated to a Tranche
Period pursuant to Section 2.3 hereof.
"Tranche Period" means a CP Tranche Period, a BR Tranche Period or a
Eurodollar Tranche Period.
"Tranche Rate" means the CP Rate, the Base Rate or the Eurodollar Rate.
"Transaction Costs" has the meaning specified in Section 8.4(a) hereof.
"Transaction Documents" means, collectively, this Agreement, the
Receivables Purchase Agreement, the Fee Letters, the Special Account Letters,
the Concentration Account Agreement, the Account Agent Agreement(s), the
Certificates, the Transfer Certificates, the Transferring Affiliate Letter, the
BMA Transfer Agreement, the Parent Agreement and all of the other instruments,
documents and other agreements executed and delivered by any Originating Entity,
FMCAG, FMCH, NMC or the Transferor in connection with any of the foregoing, in
each case, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"Transfer" means a conveyance, transfer and assignment by the Transferor to
the Agent, for the benefit of the Investors, of an undivided percentage
ownership interest in Receivables hereunder together with Related Security,
Collections and Proceeds with respect thereto (including, without limitation, as
a result of any reinvestment of Collections in Transferred Interests pursuant to
Sections 2.2(b) and 2.5).
"Transfer Certificate" has the meaning specified in Section 2.2(a) hereof.
"Transfer Date" means, with respect to each Transfer, the Business Day on
which such Transfer is made.
"Transfer Price" means with respect to any Incremental Transfer to be made
by the Agent, on behalf of the Investors participating in such Incremental
Transfer, the amount paid to the Transferor by such Investors as described in
the applicable Transfer Certificate.
"Transferor" means NMC Funding Corporation, a Delaware corporation, and its
successors and permitted assigns.
"Transferred Interest" means, at any time of determination, an undivided
percentage ownership interest in (i) each and every then outstanding Receivable,
(ii) all Related Security with respect to each such Receivable, (iii) all
Collections with respect thereto, and (iv) other Proceeds of the foregoing,
which undivided ownership interest shall be equal to the Percentage Factor at
such time, and only at such time (without regard to prior calculations). The
Transferred Interest in each Receivable, together with Related Security,
Collections and Proceeds with respect thereto, shall at all times be equal to
the Transferred Interest in each other Receivable, together with Related
Security, Collections and Proceeds with respect thereto. To the extent that the
Transferred Interest shall decrease as a result of a recalculation of the
Percentage Factor, the Agent, on behalf of the applicable Investors, shall be
considered to have reconveyed to the Transferor (without recourse,
representation or warranty of any type or kind) an undivided percentage
ownership interest in each Receivable, together with Related Security,
Collections and Proceeds with respect thereto, in an amount equal to such
decrease such that in each case the Transferred Interest in each Receivable
shall be equal to the Transferred Interest in each other Receivable.
19
"Transferring Affiliate" means a company specified on Exhibit Q hereto, as
such Schedule may be amended from time to time as provided in Section 2.15;
provided, however, that no such company shall be a Transferring Affiliate from
and after the occurrence of any Event of Bankruptcy by or with respect thereto
unless any Receivables that arose from sales by such company exist on such date,
in which case such company shall continue to be a Transferring Affiliate until
the respective Outstanding Balances of all such Receivables shall have been
reduced to zero; and provide, further, that, solely with respect to the
Receivables transferred by it to the Seller pursuant to the BMA Transfer
Agreement, BMA shall constitute a "Transferring Affiliate" hereunder.
"Transferring Affiliate Letter" means the letter agreement dated as of
August 28, 1997 from the Transferring Affiliates (other than BMA) to the Seller,
as the same may be amended, restated, supplemented or otherwise modified from
time to time with the consent of the Agent.
"UCC" means, with respect to any state, the Uniform Commercial Code as from
time to time in effect in such state.
"Unrealized Contractual Adjustment Reserve" means the reserve maintained by
the Collection Agent in accordance with its customary practices reflecting the
difference between the Outstanding Balance of Receivables owing by certain
commercial insurers and the Collection Agent's estimate of what such commercial
insurers will pay in respect of such Receivables.
"U.S." or "United States" means the United States of America.
"US Government Obligor" means any Obligor that is the federal government of
the United States, or any subdivision or agency thereof the obligations of which
are supported by the full faith and credit of the United States, and shall
include any Obligor referred to in clause (A),(B) or (F) of the definition of
"Obligor" contained in this Section 1.1.
"Voting Stock" means, with respect to any Person, capital stock issued by
such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
"WestLB" means WestLB AG, New York Branch (formerly known as Westdeutsche
Landesbank Girozentrale, New York Branch), together with its successors and
assigns.
SECTION 1.2. Other Terms. 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.
SECTION 1.3. Computation of Time Periods. Unless otherwise stated in this
Agreement, in the computation of a period of time from a specified date to a
later specified date, the word "from" means "from and including", the words "to"
and "until" each means "to but excluding", and the word "within" means "from and
excluding a specified date and to and including a later specified date".
SECTION 1.4. Amendment and Restatement. Subject to the satisfaction of
the conditions precedent set forth in Section 4.1, this Agreement amends and
restates the Existing TAA in its entirety. This Agreement is not intended to
constitute a novation of the Existing TAA. Upon the effectiveness of this
Agreement (the "Effective Date"), each reference to the Existing TAA in any
other document, instrument or agreement executed and/or delivered in connection
therewith shall mean and be a reference to this Agreement.
SECTION 1.5. Funding on Effective Date. The parties hereto acknowledge
that an adjustment to the Net Investment held by the respective Related Groups
is required to be made on the Effective Date in order to ensure that the Net
Investment held by the Investors in each Related Group is proportional to their
respective Related Group Limits. Accordingly, on the Effective Date, the
Transferor shall request such Incremental Transfers, and make such repayments,
in each case a non-pro rata basis among the Related Groups, such that by the
close of business on the Effective Date the Net Investment held by the Investors
in the respective Related Groups shall be proportional to their respective
Related Group Limits.
20
ARTICLE II
PURCHASE AND SETTLEMENTS
SECTION 2.1. Facility. Upon the terms and subject to the conditions
herein set forth, the Transferor may from time to time prior to the Termination
Date, at its option, convey, transfer and assign to the Agent, on behalf of the
Investors, percentage ownership interests in the Receivables, together with
Related Security, Collections and Proceeds with respect thereto. Each such
Transfer is made without recourse to the Transferor; provided, however, that the
Transferor shall be liable for all representations, warranties, covenants and
other agreements made by the Transferor pursuant to the terms of this Agreement
or any other Transaction Document. Each such Transfer shall be made among the
Related Groups ratably in accordance with their respective Related Group Limits.
Subject to the terms and conditions set forth herein, the Agent shall accept
such conveyance, transfer and assignment on behalf of the Investors. By
accepting any conveyance, transfer and assignment hereunder, none of the
Investors, the Administrative Agents or the Agent assumes or shall have any
obligations or liability under any of the Contracts, all of which shall remain
the obligations and liabilities of the Transferor and the Seller.
SECTION 2.2. Transfers; Certificates; Eligible Receivables (a) Incremental
Transfers. Upon the terms and subject to the conditions herein set forth the
Transferor may, at its option, request that an Incremental Transfer be made by
the Agent, on behalf of each of the applicable Investors. It shall be a
condition precedent to each Incremental Transfer that (i) after giving effect to
the payment to the Transferor of the applicable Transfer Price, (x) the sum of
the Net Investment plus the Interest Component of all outstanding Related
Commercial Paper, would not exceed the Facility Limit, (y) the Percentage Factor
would not exceed the Maximum Percentage Factor and (z) the Net Investment would
not exceed the Maximum Net Investment; (ii) the representations and warranties
set forth in Section 3.1 shall be true and correct both immediately before and
immediately after giving effect to any such Incremental Transfer and the payment
to the Transferor of the Transfer Price related thereto; (iii) an Investor
Report shall have been delivered prior to such Incremental Transfer as required
by Section 3.2 hereof and (iv) in the case of any Incremental Transfer to be
funded by the Bank Investors in any Related Group, either (x) such Bank
Investors shall have previously accepted the assignment by the related Conduit
Investor of all of its interest in the Affected Assets or (y) such Conduit
Investor shall have had an opportunity to direct that such assignment occur on
or prior to giving effect to such Incremental Transfer.
The Transferor shall, by notice to the Agent (with a copy to each
Administrative Agent) given by telecopy, offer to convey, transfer and assign to
the Agent, on behalf of the Investors, undivided percentage ownership interests
in the Receivables and the other Affected Assets relating thereto at least one
(1) Business Day prior to the proposed date of any Incremental Transfer. Each
such notice shall specify, (w) with respect to each Related Group, whether such
request is made to the Agent, on behalf of the Conduit Investor in such Related
Group or on behalf of the Bank Investors in such Related Group (it being
understood and agreed that once any Transferred Interest hereunder is acquired
on behalf of the Bank Investors in any Related Group, the Agent, on behalf of
Bank Investors in such Related Group, shall be required to purchase all
Transferred Interests held by the Agent on behalf of the Conduit Investor in
such Related Group in accordance with Section 9.7 and thereafter no additional
Incremental Transfers shall be acquired on behalf of such Conduit Investor
hereunder), (x) the desired Transfer Price (which shall be at least $1,000,000
or integral multiples of $250,000 in excess thereof) or, to the extent that the
then available unused portion of the Facility Limit is less than such amount,
such lesser amount equal to such available portion of the Facility Limit, (y)
the desired date of such Incremental Transfer and (z) the desired Tranche
Period(s) and allocations of the Net Investment of such Incremental Transfer
thereto as required by Section 2.3. Each Administrative Agent will promptly
notify the related Conduit Investor or each of the Bank Investors in its Related
Group, as the case may be, of such Administrative Agent's receipt of any request
for an Incremental Transfer to be made to the Agent on behalf of such Person. To
the extent that any such Incremental Transfer is requested of the Agent, on
behalf of a Conduit Investor, such Conduit Investor shall instruct the Agent to
accept or reject such offer by notice given to the Transferor and the Agent by
telephone or telecopy by no later than the close of its business on the Business
Day following its receipt of any such request. Each notice of proposed Transfer
shall be irrevocable and binding on the Transferor and the Transferor shall
indemnify each Investor against any loss or expense incurred by any Investor,
either directly or indirectly (including, in the case of a Conduit Investor,
through the related Liquidity Provider Agreement) as a result of any failure for
any reason (including failure to satisfy any of the conditions precedent in
respect thereof) by the Transferor to complete such
21
Incremental Transfer including, without limitation, any loss (including loss of
anticipated profits) or expense incurred by any Investor, either directly or
indirectly (including, in the case of a Conduit Investor, pursuant to the
related Liquidity Provider Agreement) by reason of the liquidation or
reemployment of funds acquired by any Investor or a related Liquidity Provider
(including, without limitation, funds obtained by issuing commercial paper or
promissory notes or obtaining deposits as loans from third parties) for any
Investor to fund such Incremental Transfer.
The Transferor has previously delivered to the Agent the Transfer
Certificate in the form of Exhibit F hereto (the "Transfer Certificate"). On the
date of each Incremental Transfer, each Administrative Agent shall send written
confirmation to the Transferor and to the Agent of the Transfer Price, the
Tranche Period(s), the Transfer Date and the Tranche Rate(s) applicable to the
portion of such Incremental Transfer made by such Administrative Agent's Related
Group. The Agent shall indicate the amount of the Incremental Transfer together
with the date thereof as well as any decrease in the Net Investment on the grid
attached to the Transfer Certificate. The Transfer Certificate shall evidence
the Incremental Transfers.
By no later than 3:00 p.m. (New York time) on any Transfer Date, each
Investor participating in the relevant Transfer shall remit its Ratable Share of
the aggregate Transfer Price for such Transfer either (i) to the account of the
related Administrative Agent specified therefor from time to time by such
Administrative Agent by notice to such Investor or (ii) if so directed by such
Administrative Agent, directly to the Transferor. The obligation of each
Investor to remit its Ratable Share of any such Transfer Price shall be several
from that of each other Investor, and the failure of any Investor to so make
such amount available to its related Administrative Agent or the Transferor, as
applicable, shall not relieve any other Investor of its obligation hereunder. If
the portion of the Transfer Price payable by the Investors in a Related Group is
remitted to the related Administrative Agent, then, following each Incremental
Transfer and such Administrative Agent's receipt of funds from the Investors in
its Related Group participating in such Transfer as aforesaid, such
Administrative Agent shall remit such portion of the Transfer Price to the
Transferor's account at the location indicated in Section 10.3 hereof, in
immediately available funds. Unless an Administrative Agent shall have received
notice from any Bank Investor in its Related Group participating in an
Incremental Transfer that such Bank Investor will not make its share of any
Transfer Price relating to such Incremental Transfer available on the applicable
Transfer Date therefor, such Administrative Agent may (but shall have no
obligation to) make such Bank Investor's share of any such Transfer Price
available to the Transferor in anticipation of the receipt by such
Administrative Agent of such amount from such Bank Investor. To the extent such
Bank Investor fails to remit any such amount to its Administrative Agent after
any such advance by such Administrative Agent on such Transfer Date, such Bank
Investor, on the one hand, and the Transferor, on the other hand, shall be
required to pay such amount, together with interest thereon at a per annum rate
equal to the Federal funds rate (as determined in accordance with clause (ii) of
the definition of "Base Rate"), in the case of such Bank Investor, or the
otherwise applicable Tranche Rate, in the case of the Transferor, to such
Administrative Agent upon its demand therefor; provided that such Administrative
Agent shall not be permitted to recover more than once for such amount or
interest thereon. Until such amount shall be repaid, such amount shall be deemed
to be Net Investment paid by the applicable Administrative Agent and such
Administrative Agent shall be deemed to be the owner of a Transferred Interest
hereunder. Upon the payment of such amount to such Administrative Agent (x) by
the Transferor, the amount of the aggregate Net Investment shall be reduced by
such amount or (y) by such Bank Investor, such payment shall constitute such
Bank Investor's payment of its share of the applicable Transfer Price for such
Transfer.
(b) Reinvestment Transfers. On each Business Day occurring after the
initial Incremental Transfer hereunder and prior to the Termination Date, the
Transferor hereby agrees to convey, transfer and assign to the Agent, on behalf
of the Investors, and in consideration of Transferor's agreement to maintain at
all times prior to the Termination Date a Net Receivables Balance in an amount
at least sufficient to maintain the Percentage Factor at an amount not greater
than the Maximum Percentage Factor, the Agent may, on behalf of each Conduit
Investor (unless such Conduit Investor has otherwise directed the Agent) and
shall, on behalf of each of the Bank Investors, agree to purchase from the
Transferor undivided percentage ownership interests in each and every
Receivable, together with Related Security, Collections and Proceeds with
respect thereto, to the extent that Collections are available for such Transfer
in accordance with Section 2.5 hereof, such that after giving effect to such
Transfer, (i) the amount of the Net Investment at the close of business on such
Business Day shall be equal
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to the amount of the Net Investment at the close of the business on the Business
Day immediately preceding such Business Day plus the Transfer Price of any
Incremental Transfer made on such day, if any, and (ii) the Transferred Interest
in each Receivable, together with Related Security, Collections and Proceeds
with respect thereto, shall be equal to the Transferred Interest in each other
Receivable, together with Related Security, Collections and Proceeds with
respect thereto.
(c) All Transfers. Each Transfer shall constitute a purchase by the Agent,
on behalf of the Investors, of undivided percentage ownership interests in each
and every Receivable, together with Related Security, Collections and Proceeds
with respect thereto, then existing, as well as in each and every Receivable,
together with Related Security, Collections and Proceeds with respect thereto,
which arises at any time after the date of such Transfer. The Agent's aggregate
undivided percentage ownership interest in the Receivables, together with the
Related Security, Collections and Proceeds with respect thereto, held on behalf
of the Investors, shall equal the Percentage Factor in effect from time to time.
The Agent shall hold the Transferred Interests on behalf of the Investors in
accordance with each such Investor's percentage interest in the Transferred
Interest (determined on the basis of the relationship that the portion of the
Net Investment funded by such Investor bears to the aggregate Net Investment of
all Investors at such time).
(d) Certificate. The Transferor has issued to the Agent the Certificate,
in the form of Exhibit M. The Certificate remains in full force and effect and
is hereby ratified and confirmed.
(e) Percentage Factor. The Percentage Factor shall be computed by the
Collection Agent as of the opening of business of the Collection Agent on the
effective date of this Agreement. Thereafter until the Termination Date, the
Collection Agent shall recompute the Percentage Factor at the time of each
Incremental Transfer pursuant to Section 2.2(a) and as of the close of business
of the Collection Agent on each Business Day (other than a day after the
Termination Date) and report such recomputation to the Agent monthly, in the
Investor Report, and at such other times as may be requested by the Agent. The
Percentage Factor shall remain constant from the time as of which any such
computation or recomputation is made until the time as of which the next such
recomputation, if any, shall be made, notwithstanding any additional Receivables
arising, any Incremental Transfer made pursuant to Section 2.2(a) or any
Reinvestment Transfer made pursuant to Sections 2.2(b) and 2.5 during any period
between computations of the Percentage Factor. The Percentage Factor, as
computed as of the close of business on the Business Day immediately preceding
the Termination Date, shall remain constant at all times on and after the
Termination Date until the date on which the Net Investment has been reduced to
zero, and all accrued Discount and Servicing Fees have been paid in full and all
other Aggregate Unpaids have been paid in full at which time the Percentage
Factor shall be recomputed in accordance with Section 2.6.
SECTION 2.3. Selection of Tranche Periods and Tranche Rates.
(a) Prior to the Termination Date; Transferred Interest held on behalf of a
Conduit Investor. At all times hereafter, but prior to the Termination Date
with respect to any portion of the Net Investment held on behalf of a Conduit
Investor that is funded through the issuance of Commercial Paper, such portion
of the Net Investment shall be allocated to a CP Tranche Period as set forth in
the definition of such term. Each Conduit Investor confirms that it is its
intention to allocate all or substantially all of the Net Investment held on
behalf of it to CP Tranche Periods, provided that such Conduit Investor may
determine, from time to time, in its sole discretion, that funding such Net
Investment through the issuance of Commercial Paper is not possible or is not
desirable for any reason. If, prior to the Termination Date, any portion of the
Net Investment held on behalf of a Conduit Investor is not funded through the
issuance of Commercial Paper, then such portion of the Net Investment shall be
allocated to a BR Tranche or a Eurodollar Tranche in accordance with Section
2.3(c) in the same manner as if such portion of the Net Investment was held by
or on behalf of the Bank Investors. In the case of any Tranche Period
outstanding upon the Termination Date, such Tranche Period shall end on such
date.
(b) After the Termination Date; Transferred Interest Held on behalf of a
Conduit Investor. At all times on and after the Termination Date, with respect
to any portion of the Transferred Interest which shall be held by the Agent on
behalf of a Conduit Investor, such Conduit Investor or its Administrative Agent,
as applicable, shall select all Tranche Periods and Tranche Rates applicable
thereto.
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(c) Prior to the Termination Date; Transferred Interest Held on Behalf of
Bank Investor. At all times with respect to any portion of the Transferred
Interest held by the Agent on behalf of the Bank Investors in any Related Group,
but prior to the Termination Date, the initial Tranche Period applicable to such
portion of the Net Investment allocable thereto shall be a period of not greater
than 14 days and such Tranche shall be a BR Tranche. Thereafter, with respect to
such portion, and with respect to any other portion of the Transferred Interest
held on behalf of the Bank Investors (or any of them) in any Related Group,
provided that the Termination Date shall not have occurred, the Tranche Period
applicable thereto shall be, at the Transferor's option, either a BR Tranche or
a Eurodollar Tranche. The Transferor shall give the Administrative Agent for
each Related Group irrevocable notice by telephone of the new requested Tranche
Period applicable to the Bank Investors in such Related Group at least three (3)
Business Days prior to the expiration of any then existing Tranche Period
applicable to such Related Group and, if the Transferor shall fail to provide
such notice, the applicable Administrative Agent on behalf of the Bank Investors
in such Related Group may, in its sole discretion, select the new Tranche Period
in respect of the applicable Tranche. In the case of any Tranche Period
outstanding upon the occurrence of the Termination Date, such Tranche Period
shall end on the date of such occurrence.
(d) After the Termination Date; Transferred Interest Held on behalf of Bank
Investor. At all times on and after the Termination Date, with respect to any
portion of the Transferred Interest held by the Agent on behalf of the Bank
Investors in any Related Group, the Administrative Agent for such Related Group
shall select all Tranche Periods and Tranche Rates applicable thereto.
(e) Eurodollar Rate Protection; Illegality. (i) If the Administrative
Agent for any Related Group is unable to obtain on a timely basis the
information necessary to determine the LIBOR Rate for any proposed Eurodollar
Tranche, then
(A) such Administrative Agent shall forthwith notify the Investors in
such Related Group, as applicable, and the Transferor that the Eurodollar
Rate cannot be determined for such Eurodollar Tranche, and
(B) while such circumstances exist, neither such Administrative Agent
nor any of the Investors in such Related Group shall allocate the Net
Investment of any additional Transferred Interests purchased during such
period or reallocate the Net Investment allocated to any then existing
Tranche ending during such period, to a Eurodollar Tranche.
(ii) If, with respect to any outstanding Eurodollar Tranche, any Investor
on behalf of which the Agent holds any Transferred Interest therein notifies its
Administrative Agent that it is unable to obtain matching deposits in the London
interbank market to fund its purchase or maintenance of such Transferred
Interest or that the Eurodollar Rate applicable to such Transferred Interest
will not adequately reflect the cost to such Investor of funding or maintaining
its respective Transferred Interest for such Tranche Period then such
Administrative Agent shall forthwith so notify the Transferor, whereupon neither
such Administrative Agent nor the Investors in the Related Group shall, while
such circumstances exist, allocate any Net Investment of any additional
Transferred Interest purchased during such period or reallocate the Net
Investment allocated to any Tranche Period ending during such period, to a
Eurodollar Tranche.
(iii) Notwithstanding any other provision of this Agreement, if any
Investor shall notify its Administrative Agent that such Investor has determined
(or has been notified by any Liquidity Provider) that the introduction of or any
change in or in the interpretation of any law or regulation makes it unlawful
(either for such Investor or such Liquidity Provider, as applicable), or any
central bank or other governmental authority asserts that it is unlawful, for
such Investor or such Liquidity Provider, as applicable, to fund the purchases
or maintenance of Transferred Interests at the Eurodollar Rate, then (x) as of
the effective date of such notice from such Investor to its Administrative
Agent, the obligation or ability of the such Investor to fund its purchase or
maintenance of Transferred Interests at the Eurodollar Rate shall be suspended
until such Investor notifies its Administrative Agent that the circumstances
causing such suspension no longer exist and (y) the Net Investment of each
Eurodollar Tranche in which such Investor owns an interest shall either (1) if
such Investor may lawfully continue to maintain such Transferred Interest at the
Eurodollar Rate until the last day of the applicable Tranche Period, be
reallocated on the last day of such Tranche Period to another Tranche Period in
respect of which the Net Investment allocated thereto accrues Discount at a
Tranche Rate other than the Eurodollar Rate or (2) if such
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Investor shall determine that it may not lawfully continue to maintain such
Transferred Interest at the Eurodollar Rate until the end of the applicable
Tranche Period, such Investor's share of the Net Investment allocated to such
Eurodollar Tranche shall be deemed to accrue Discount at the Base Rate from the
effective date of such notice until the end of such Tranche Period.
(f) Separate Tranches for Related Groups. In no event shall portions of
the Net Investment held by Investors from different Related Groups be allocated
to the same Tranche.
SECTION 2.4. Discount, Fees and Other Costs and Expenses. Notwithstanding
any limitation on recourse contained herein, the Transferor shall pay, as and
when due in accordance with this Agreement, all fees hereunder, Discount
(including Discount due any Conduit Investor or any Bank Investor), all amounts
payable pursuant to Article VIII hereof, if any, and the Servicing Fees. On the
last day of each Tranche Period (or, in the case of a CP Tranche Period, by no
later than the second Business Day following the last day of such CP Tranche
Period), the Transferor shall pay to each Administrative Agent, on behalf of the
applicable Investors in its Related Group, an amount equal to the accrued and
unpaid Discount for such Tranche Period together with, in the event the
Transferred Interest is held on behalf of a Conduit Investor, an amount equal to
the discount accrued on the Commercial Paper of such Conduit Investor to the
extent such Commercial Paper was issued in order to fund the Transferred
Interest in an amount in excess of the Transfer Price of an Incremental
Transfer. Discount shall accrue with respect to each Tranche on each day
occurring during the Tranche Period related thereto. Nothing in this Agreement
shall limit in any way the obligations of the Transferor to pay the amounts set
forth in this Section 2.4.
SECTION 2.5. Non-Liquidation Settlement and Reinvestment Procedures. On
each day after the date of any Incremental Transfer but prior to the Termination
Date and provided that no Potential Termination Event shall have occurred and be
continuing, the Collection Agent shall, out of Collections received on or prior
to such day and not previously applied or accounted for: (i) set aside and hold
in trust for the Agent, on behalf of the applicable Investors (or deposit into
the Collection Account if so required pursuant to Section 2.12 hereof), an
amount equal to all Discount and the Servicing Fee accrued through such day and
not so previously set aside or paid and (ii) apply the balance of such
Collections remaining after application of Collections as provided in clause (i)
of this Section 2.5 hereof to the Transferor, for the benefit of the Agent, on
behalf of the applicable Investors, to the purchase of additional undivided
percentage interests in each Receivable pursuant to Section 2.2(b) hereof. Any
Collections so set aside as described in clause (i) above shall be allocated,
among the Related Groups ratably in proportion to the accrued Discount and
Servicing Fee with respect to the Investors in each such Related Group. On the
last day of each Tranche Period applicable to any portion of the Net Investment
held by one or more Investors in a Related Group (or, in the case of a CP
Tranche Period, by no later than the second Business Day following the last day
of such CP Tranche Period), from the amounts set aside as described in clause
(i) of the first sentence of this Section 2.5 hereof that have been allocated to
the Investors in such Related Group, the Collection Agent shall deposit to the
applicable Administrative Agent's account, for the benefit of such Investors, an
amount equal to the accrued and unpaid Discount for such Tranche Period and
shall deposit to its own account an amount equal to the accrued and unpaid
Servicing Fee for such Tranche Period. The applicable Administrative Agent, upon
its receipt of such amounts in such Administrative Agent's account, shall
distribute such amounts to the applicable Investors entitled thereto as set
forth above; provided that if such Administrative Agent shall have insufficient
funds to pay all of the above amounts in full on any such date, such
Administrative Agent shall pay such amounts ratably (based on the amounts owing
to each such Investor) to all such Investors entitled to payment thereof. In
addition, the Collection Agent shall remit to the Transferor at the end of each
Tranche Period, such portion of Collections not allocated to the Agent, on
behalf of the applicable Investors.
SECTION 2.6. Liquidation Settlement Procedures. (a) If at any time on or
prior to the Termination Date, the Percentage Factor is greater than the Maximum
Percentage Factor, then the Transferor shall immediately pay to the
Administrative Agents for the Related Groups, for the benefit of the applicable
Investors in their respective Related Groups, from previously received
Collections, an aggregate amount equal to the amount such that, when applied in
reduction of the Net Investment, will result in the Percentage Factor being less
than or equal to the Maximum Percentage Factor. Such aggregate amount shall be
paid to such Administrative Agents ratably in accordance with the portion of the
Net Investment held by their respective Related Groups. Any amount so paid
25
to an Administrative Agent for a Related Group shall be applied to the reduction
of the Net Investment of Tranche Periods applicable to such Related Group
selected by such Administrative Agent.
(b) On the Termination Date and on each day thereafter, and on each day on
which a Termination Event or a Potential Termination Event has occurred and is
continuing, the Collection Agent shall set aside and hold in trust for the
Agent, on behalf of the Investors (or deposit into the Collection Account if so
required pursuant to Section 2.12 hereof) all Collections received on such day.
The Collections so set aside shall be allocated, among the Related Groups
ratably in accordance with the portion of the Net Investment held by each such
Related Group. On the Termination Date or the day on which a Termination Event
or Potential Termination Event has occurred and is continuing, the Collection
Agent shall deposit to each Administrative Agent's account, for the benefit of
the applicable Investors, any amounts set aside pursuant to Section 2.5 above
which have been allocated to such Administrative Agent's Related Group as
described in Section 2.5. On the last day of each Tranche Period to occur on or
after the Termination Date, during the continuance of a Termination Event or
Potential Termination Event, the Collection Agent shall deposit to each
Administrative Agent's account to the extent not already so deposited, for the
benefit of the applicable Investors in its Related Group, the amounts so set
aside that have been allocated to the Investors in such Related Group pursuant
to this Section 2.6, but not to exceed the sum of (i) the accrued Discount for
such Tranche Period, (ii) the portion of the Net Investment allocated to such
Tranche Period, and (iii) all other Aggregate Unpaids. On such day, the
Collection Agent shall deposit to its account, from the amounts so allocated to
the Investors in such Related Group pursuant to the preceding sentence which
remain after payment in full of the aforementioned amounts, the accrued
Servicing Fee for such Tranche Period. If with respect to any Tranche Period
there shall be insufficient funds on deposit for the Collection Agent to
distribute funds in payment in full of the aforementioned amounts, the
Collection Agent shall distribute funds first, in payment of the accrued
Discount for such Tranche Period, second, if the Transferor, the Seller or any
Affiliate of the Transferor or the Seller is not then the Collection Agent, to
the Collection Agent's account, in payment of the Servicing Fee payable to the
Collection Agent to the extent allocable to such Tranche Period, third, in
reduction of the Net Investment allocated to such Tranche Period fourth, in
payment of all fees payable by the Transferor hereunder to the members of the
relevant Related Group, fifth, in payment of all other Aggregate Unpaids owing
to the members of such Related Group and sixth, if the Transferor, the Seller or
any Affiliate of the Transferor or the Seller is the Collection Agent, to its
account as Collection Agent, in payment of the Servicing Fee payable to such
Person as Collection Agent to the extent such Servicing Fee is allocable to such
Tranche Period. The applicable Administrative Agent, upon its receipt of such
amounts in such Administrative Agent's account, shall distribute such amounts to
the Investors in its Related Group entitled thereto as set forth above; provided
that if such Administrative Agent shall have insufficient funds to pay all of
the above amounts in full on any such date, such Administrative Agent shall pay
such amounts in the order of priority set forth above and, with respect to any
such category above for which such Administrative Agent shall have insufficient
funds to pay all amounts owing on such date, ratably (based on the amounts in
such categories owing to such Persons) among all such Persons entitled to
payment thereof. For purposes of this Section 2.6, the Agent shall be deemed to
be a member of the Related Group that includes Paradigm.
(c) Following the later to occur of the Termination Date and the date on
which the Net Investment has been reduced to zero, all accrued Discount and
Servicing Fees have been paid in full and all other Aggregate Unpaids have been
paid in full, (i) the Collection Agent shall recompute the Percentage Factor,
(ii) the Agent, on behalf of the Investors, shall be considered to have
reconveyed to the Transferor all of the right, title and interest in and to the
Affected Assets (including the Transferred Interest) without recourse,
representation or warranty of any type or kind, (iii) the Collection Agent shall
pay to the Transferor any remaining Collections set aside and held by the
Collection Agent for the Investors pursuant to this Section 2.6 and (iv) the
Agent, on behalf of the Investors, shall execute and deliver to the Transferor,
at the Transferor's expense, such documents or instruments as are necessary to
terminate the Agent's interests in the Affected Assets. Any such documents shall
be prepared by or on behalf of the Transferor.
SECTION 2.7. Fees. Notwithstanding any limitation on recourse contained
in this Agreement, on the last day of each month the Transferor shall pay the
following non-refundable fees: (i) to each Conduit Investor, solely for its own
account, the Program Fee with respect to such Conduit Investor, (ii) to each
Conduit Investor, the
26
Facility Fee with respect to the applicable Related Group (for distribution to
the Bank Investors in such Related Group) and (iii) to the Agent the
Administration Fee.
SECTION 2.8. Protection of Ownership Interest of the Investors; Special
Accounts and Concentration Account. (a) The Transferor agrees that it will, and
will cause the Seller to, from time to time, at its expense, promptly execute
and deliver all instruments and documents and take all actions as may be
necessary or as the Agent or any Administrative Agent may reasonably request in
order to perfect or protect the Transferred Interest or to enable the Agent, the
Administrative Agents or the Investors to exercise or enforce any of their
respective rights hereunder. Without limiting the foregoing, the Transferor
will, and will cause the Seller to, upon the request of the Agent, any
Administrative Agent or any of the Investors, in order to accurately reflect
this purchase and sale transaction, execute and file such financing or
continuation statements or amendments thereto or assignments thereof as
permitted pursuant to Section 9.7 hereof as may be requested by the Agent, any
Administrative Agent or any of the Investors and (y) ▇▇▇▇ its respective master
data processing records and other documents with a legend describing the
conveyance to the Transferor of the Receivables (in the case of the Seller) and
to the Agent, for the benefit of the Investors, of the Transferred Interest. The
Transferor shall, and will cause the Seller to, upon request of the Agent, any
Administrative Agent or any of the Investors obtain such additional search
reports as the Agent, any Administrative Agent or any of the Investors shall
request. To the fullest extent permitted by applicable law, the Agent shall be
authorized to sign and file financing statements , continuation statements and
amendments thereto relating to the Receivables, Related Security and Collections
and assignments thereof to the Agent or any successor or permitted assign of the
Agent without the Transferor's or the Seller's signature. Carbon, photographic
or other reproduction of this Agreement or any financing statement shall be
sufficient as a financing statement. The Transferor shall not, and shall not
permit the Seller or any Transferring Affiliate to, change its respective name,
identity or corporate structure nor relocate its respective chief executive
office or jurisdiction of organization or any office where Records are kept
unless it shall have: (i) given the Agent and each Administrative Agent at least
thirty (30) days prior notice thereof and (ii) prepared at Transferor's expense
and delivered to the Agent all financing statements, instruments and other
documents necessary to preserve and protect the Transferred Interest or
requested by the Agent or any Administrative Agent in connection with such
change or relocation; provided that the jurisdiction of organization for the
Transferor, the Seller and each Transferring Affiliate shall at all times be a
State within the United States. Any filings under the UCC or otherwise that are
occasioned by such change in name or location shall be made at the expense of
Transferor.
(b) The Agent is hereby authorized at any time to date, and to deliver to
the Concentration Account Bank, the Concentration Account Notice delivered
hereunder. The Transferor hereby, when the Agent shall deliver the Concentration
Account Notice to the Concentration Account Bank, transfers to the Agent the
exclusive ownership and control of the Concentration Account, and shall take any
further action that the Agent may reasonably request to effect such transfer. In
case any authorized signatory of the Transferor whose signature shall appear on
the Concentration Account Agreement shall cease to have such authority before
the delivery of the Concentration Account Notice, such signature shall
nevertheless be valid and sufficient for all purposes as if such authority had
remained in force at the time of such delivery. The Agent shall, at the time it
delivers the Concentration Account Notice to the Concentration Account Bank,
provide a copy thereof to the Transferor; provided that the failure on the part
of the Agent to provide such notice to the Transferor shall not affect the
validity or effectiveness of the Concentration Account Notice or impair any
rights of the Agent, any Administrative Agent or any of the Investors hereunder.
(c) In addition and without limiting the authority of the Agent set forth
in subsection (b) above, but subject to subsection (d) below, the Transferor
shall cause each Originating Entity to instruct any or all of the Special
Account Banks (which instructions shall be maintained in full force and effect
at all times) to transfer directly to the Concentration Account all Collections
from time to time on deposit in the applicable Special Accounts on a daily basis
in accordance with the terms set forth in the applicable Special Account Letter.
In the event the Transferor shall at any time determine, for any of the reasons
described in subsection (d) below, that the Transferor or any Originating Entity
shall be unable to comply fully with the requirements of this subsection (c),
the Transferor shall promptly so advise the Agent and each Administrative Agent,
and the Transferor, the Agent and each Administrative Agent shall commence
discussions with a view toward implementing an alternative arrangement therefor
satisfactory to the Agent and each Administrative Agent.
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(d) Anything to the contrary herein notwithstanding, all Medicare or
Medicaid payments which are made by an Obligor with respect to any Receivables
shall be collected from such Obligor only by (i) the applicable Originating
Entity or (ii) an agent of such Originating Entity, except to the extent that an
Obligor may be required to submit any such payments directly to a Person other
than such Originating Entity pursuant to a court-ordered assignment which is
valid, binding and enforceable under applicable federal and state Medicare
Regulations and Medicaid Regulations; and neither this Agreement nor any other
Transaction Document shall be construed to permit any other Person, in violation
of applicable Medicare Regulations or Medicaid Regulations to collect or
receive, or to be entitled to collect or receive, any such payments prior to
such Originating Entity's or such agent's receipt thereof.
SECTION 2.9. Deemed Collections; Application of Payments. (a) If on any
day the Outstanding Balance of a Receivable is either (x) reduced as a result of
any defective, rejected or returned merchandise or services, any discount,
credit, Contractual Adjustment, rebate, dispute, warranty claim, repossessed or
returned goods, chargeback, allowance, any billing adjustment or other
adjustment, or (y) reduced or canceled as a result of a setoff or offset in
respect of any claim by any Person (whether such claim arises out of the same or
a related transaction or an unrelated transaction), the Transferor shall be
deemed to have received on such day a Collection of such Receivable in the
amount of such reduction or cancellation and the Transferor shall pay to the
Collection Agent an amount equal to such reduction or cancellation and such
amount shall be applied by the Collection Agent as a Collection in accordance
with Section 2.5 or 2.6 hereof, as applicable. The Net Investment shall be
reduced by the amount of such payment applied to the reduction of the Net
Investment and actually received by the applicable Administrative Agent.
(b) If on any day it is determined that (i) any of the representations or
warranties in Article III was untrue with respect to a Receivable as of the date
such representation or warranty was made or (ii) any of the representations or
warranties set forth in Section 3.1(d) or Section 3.1(j) becomes untrue with
respect to a Receivable (whether on or after the date of any transfer of an
interest therein to the Agent or any of the Investors as contemplated hereunder)
or (iii) a Receivable that was formerly treated as or represented to be an
Eligible Receivable does not satisfy the requirements in paragraph (xi) of the
definition of Eligible Receivable, the Transferor shall be deemed to have
received on such day a Collection on such Receivable in full and the Transferor
shall on such day pay to the Collection Agent an amount equal to the Outstanding
Balance of such Receivable and such amount shall be allocated and applied by the
Collection Agent as a Collection allocable to the Transferred Interest in
accordance with Section 2.5 or 2.6 hereof, as applicable. The Net Investment
shall be reduced by the amount of such payment applied to the reduction of the
Net Investment and actually received by the applicable Administrative Agent.
(c) Any payment by an Obligor in respect of any indebtedness owed by it to
the Transferor or the Seller shall, except as otherwise specified by such
Obligor or otherwise required by contract or law and unless otherwise instructed
by each Administrative Agent, be applied as a Collection of any Receivable of
such Obligor included in the Transferred Interest (starting with the oldest such
Receivable) or the extent of any amounts then due and payable thereunder before
being applied to any other receivable or other indebtedness of such Obligor.
SECTION 2.10. Payments and Computations, Etc. All amounts to be paid or
deposited by the Transferor or the Collection Agent hereunder shall be paid or
deposited in accordance with the terms hereof no later than 11:00 a.m. (New York
City time) on the day when due in immediately available funds; if such amounts
are payable to the Agent or any Administrative Agent (whether on behalf of any
of the Investors or otherwise) they shall be paid or deposited in the applicable
account indicated in Section 10.3 hereof, until otherwise notified by the Agent
or such Administrative Agent, as the case may be. The Transferor shall, to the
extent permitted by law, pay to each Administrative Agent, for the benefit of
itself and the Investors in its Related Group, upon demand, interest on all
amounts owing to such Administrative Agent or such Investors not paid or
deposited when due hereunder at a rate equal to 2% per annum plus the Base Rate.
All computations of Discount, interest and all per annum fees hereunder shall be
made on the basis of a year of 360 days for the actual number of days (including
the first but excluding the last day) elapsed. Any computations by an
Administrative Agent of amounts payable by the Transferor hereunder to such
Administrative Agent or any Investor in its Related Group shall be binding upon
all parties hereto absent manifest error.
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SECTION 2.11. Reports. On or prior to the last Business Day of each
month, the Collection Agent shall prepare and forward to the Agent and each
Administrative Agent (i) an Investor Report as of the end of the last day of the
immediately preceding month, (ii) a listing by Primary Payor of all Receivables
together with an analysis as to the aging of such Receivables as of such last
day, but only to the extent the Receivable Systems of the Collection Agent are
able to generate such information, (iii) written confirmation that all payments
in cash, by way of credits to intercompany accounts (in the case of purchases
made by the Seller from any Transferring Affiliate) or by way of application of
proceeds of advances made under the Subordinated Note (in the case of purchases
made by the Transferor from the Seller) have been made by the Transferor under
the Receivables Purchase Agreement or by the Seller under the Transferring
Affiliate Letter or the BMA Transfer Agreement, as applicable, in accordance
with the respective terms of such agreement, and (iv) such other information as
the Agent or any Administrative Agent may reasonably request.
SECTION 2.12. Collection Account. The Collection Agent has established
and shall maintain with the Agent a segregated account (the "Collection
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Agent, on behalf of the Investors.
During the continuance of a Collection Agent Default or a Termination Event or a
Potential Termination Event, the Collection Agent shall remit daily within
forty-eight hours of receipt to the Collection Account all Collections received
with respect to any Receivables. Funds on deposit in the Collection Account
(other than investment earnings) shall be invested by the Agent in Eligible
Investments that will mature so that such funds will be available prior to the
last day of each successive Tranche Period following such investment. On the
last day of each Tranche Period, such funds on deposit, together with all
interest and earnings (net of losses and investment expenses) thereon, in the
Collection Account shall be made available for application in accordance with
the terms of Section 2.6 or otherwise for application toward payments required
to be made hereunder (including Discount) by the Transferor. On the date on
which the Net Investment is zero, all accrued Discount and Servicing Fees have
been paid in full and all other Aggregate Unpaids have been paid in full, any
funds remaining on deposit in the Collection Account shall be paid to the
Transferor.
SECTION 2.13. Sharing of Payments, Etc. If any Investor (for purposes of
this Section only, being a "NPRBI") shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of setoff, or otherwise) on
account of Transferred Interest owned by it (other than pursuant to Section 2.7,
or Article VIII and other than as a result of the differences in the timing of
the applications of Collections pursuant to Section 2.5 or 2.6) in excess of its
ratable share of payments on account of Transferred Interest obtained by the
Investors entitled thereto, such NPRBI shall forthwith purchase from the other
Investors entitled to a share of such amount participations in the Transferred
Interests owned by such other Investors the excess payment ratably with each
such other Investor entitled thereto; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such NPRBI, such
purchase from each such other Investor shall be rescinded and each such other
Investor shall repay to the NPRBI the purchase price paid by such NPRBI for such
participation to the extent of such recovery, together with an amount equal to
such other Investor's ratable share (according to the proportion of (a) the
amount of such other Investor's required payment to (b) the total amount so
recovered from the NPRBI) of any interest or other amount paid or payable by the
NPRBI in respect of the total amount so recovered.
SECTION 2.14. Right of Setoff. Without in any way limiting the provisions
of Section 2.13, each Investor is hereby authorized (in addition to any other
rights it may have) at any time after the occurrence of the Termination Date or
during the continuance of a Potential Termination Event to setoff, appropriate
and apply (without presentment, demand, protest or other notice which are hereby
expressly waived) any deposits (other than any deposits then being held in any
Special Account maintained by an Investor as to which deposits the Investors
waive their rights of set-off in respect of the Aggregate Unpaid) and any other
indebtedness held or owing by any Investor to, or for the account of, the
Transferor against the amount of the Aggregate Unpaids owing by the Transferor
to such Investor or to the Agent or any Administrative Agent on behalf of such
Investor (even if contingent or unmatured).
SECTION 2.15. Additional Transferring Affiliates. (a) If (i) one or more
direct or indirect wholly-owned subsidiaries of FMCH (other than the
Transferring Affiliates) now owned or hereafter acquired, is primarily engaged
in the same business as is conducted on the date hereof by the Originating
Entities or (ii) FMCH
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reorganizes its corporate structure such that facilities generating Receivables
on the date hereof (or acquired as contemplated by clause (i)) are owned by one
or more additional wholly-owned subsidiaries of FMCH, any or all of the
wholly-owned subsidiaries referred to in clauses (i) and (ii) may, with the
prior written consent of each Administrative Agent (which consent shall not be
unreasonably withheld or delayed), become Transferring Affiliates under this
Agreement upon delivery to each Administrative Agent of (x) counterparts of the
Transferring Affiliate Letter duly executed by such subsidiary or subsidiaries
and (y) the documents relating to such subsidiary or subsidiaries of the kind
delivered by or on behalf of the Transferring Affiliates (other than BMA)
pursuant to Section 4.1, together with such other instruments, documents and
agreements as any Administrative Agent may reasonably request in connection
therewith.
(b) Upon the addition of any wholly-owned subsidiary of FMCH as a
Transferring Affiliate pursuant to subsection (a) above, the provisions of this
Agreement, including Exhibit Q, shall, without further act or documentation, be
deemed amended to apply to such subsidiary to the same extent as the same apply
to the Transferring Affiliates as of the date hereof and the term "Transferring
Affiliate" in this Agreement shall mean and refer to such subsidiary as well as
each then existing Transferring Affiliate.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the Transferor. The
Transferor represents and warrants to the Agent, each Administrative Agent and
each Investor that:
(a) Corporate Existence and Power. The Transferor is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all corporate power and all material
governmental licenses, authorizations, consents and approvals required to
carry on its business in each jurisdiction in which its business is now
conducted. The Transferor is duly qualified to do business in, and is in
good standing in, every other jurisdiction in which the nature of its
business requires it to be so qualified, except where the failure to be so
qualified or in good standing would not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization; Contravention. The
execution, delivery and performance by the Transferor of this Agreement,
the Receivables Purchase Agreement, the Fee Letters, the Certificates, the
Transfer Certificates and the other Transaction Documents to which the
Transferor is a party are within the Transferor's corporate powers, have
been duly authorized by all necessary corporate action, require no action
by or in respect of, or filing with, any Official Body or official thereof
(except as contemplated by Section 2.8 hereof), and do not contravene, or
constitute a default under, any provision of applicable law, rule or
regulation (including, without limitation, any CHAMPUS/VA Regulation, any
Medicaid Regulation or any Medicare Regulation) or of the Certificate of
Incorporation or Bylaws of the Transferor or of any agreement, judgment,
injunction, order, writ, decree or other instrument binding upon the
Transferor or result in the creation or imposition of any Adverse Claim on
the assets of the Transferor or any of its Subsidiaries (except as
contemplated by Section 2.8 hereof).
(c) Binding Effect. Each of this Agreement, the Receivables Purchase
Agreement, the Fee Letters, the Certificates and the other Transaction
Documents to which the Transferor is a party constitutes and the Transfer
Certificate upon payment of the Transfer Price set forth therein will
constitute the legal, valid and binding obligation of the Transferor,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, moratorium or other similar laws affecting the
rights of creditors generally.
(d) Perfection. Immediately preceding each Transfer hereunder, the
Transferor shall be the owner of all of the Receivables, free and clear of
all Adverse Claims. On or prior to each Transfer and each recomputation of
the Transferred Interest, all financing statements and other documents
required to be recorded or filed, or notices to Obligors to be given, in
order to perfect and protect the Agent's Transferred Interest against all
creditors of and purchasers from the Transferor and the Seller will have
been duly filed in each filing office necessary for such purpose and all
filing fees and taxes, if any, payable in connection with such filings
shall have been paid in full.
30
(e) Accuracy of Information. All information heretofore furnished by
the Transferor (including without limitation, the Investor Reports, any
reports delivered pursuant to Section 2.11 hereof and the Transferor's
financial statements) to any Investor, the Agent or any Administrative
Agent for purposes of or in connection with this Agreement or any
transaction contemplated hereby is, and all such information hereafter
furnished by the Transferor to the any Investor, the Agent or any
Administrative Agent will be, true and accurate in every material respect,
on the date such information is stated or certified.
(f) Tax Status. The Transferor has filed all tax returns (federal,
state and local) required to be filed and has paid or made adequate
provision for the payment of all taxes, assessments and other governmental
charges.
(g) Action, Suits. Except as set forth in Exhibit H hereof, there are
no actions, suits or proceedings pending, or to the knowledge of the
Transferor threatened, in or before any court, arbitrator or other body,
against or affecting (i) the Transferor or any of its properties or (ii)
any Affiliate of the Transferor or its respective properties, which may, in
the case of proceedings against or affecting any such Affiliate,
individually or in the aggregate, have a Material Adverse Effect.
(h) Use of Proceeds. No proceeds of any Transfer will be used by the
Transferor to acquire any security in any transaction which is subject to
Section 13 or 14 of the Securities Exchange Act of 1934, as amended.
(i) Place of Business. The principal place of business and chief
executive office of the Transferor are located at the address of the
Transferor indicated in Section 10.3 hereof and the offices where the
Transferor keeps substantially all its Records, are located at the
address(es) described on Exhibit I or such other locations notified to each
Administrative Agent in accordance with Section 2.8 hereof in jurisdictions
where all action required by Section 2.8 hereof has been taken and
completed. The principal place of business and chief executive office of
each Originating Entity is located at the address of such Originating
Entity indicated in Exhibit I hereof and the offices where the each
Originating Entity keeps substantially all its Records are located at the
address(es) specified on Exhibit I with respect to such Originating Entity
or such other locations notified to each Administrative Agent in accordance
with Section 2.8 hereof in jurisdictions where all action required by
Section 2.8 hereof has been taken and completed. The jurisdiction of
organization of each of the Seller and the Transferor is the State of
Delaware. The jurisdiction of organization for each Transferring Affiliate
is the state specified opposite such Transferring Affiliate's name on
Exhibit Q.
(j) Good Title. Upon each Transfer and each recomputation of the
Transferred Interest, the Agent shall acquire a valid and perfected first
priority undivided percentage ownership interest to the extent of the
Transferred Interest or a first priority perfected security interest in
each Receivable that exists on the date of such Transfer and recomputation
and in the Related Security and Collections with respect thereto free and
clear of any Adverse Claim.
(k) Tradenames, Etc. As of the date hereof: (i) the Transferor's
chief executive office is located at the address for notices set forth in
Section 10.3 hereof; (ii) the Transferor has no subsidiaries or divisions;
(iii) the Transferor has, within the last five (5) years, not operated
under any tradename, and, within the last five (5) years, has not changed
its name, merged with or into or consolidated with any other corporation or
been the subject of any proceeding under Title 11, United States Code
(Bankruptcy); and (iv) none of the Originating Entities has, within the
last five (5) years, operated under any tradename other than Fresenius
Medical Care North America or Spectra Renal Management or, within the last
five (5) years, changed its name, merged with or into or consolidated with
any other Person or been the subject of any proceeding under ▇▇▇▇▇ ▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ Code (Bankruptcy), except in each case as described on
Exhibit H.
(l) Nature of Receivables. Each Receivable (x) represented by the
Transferor or the Collection Agent to be an Eligible Receivable (including
in any Investor Report or other report delivered pursuant to Section 2.11
hereof) or (y) included in the calculation of the Net Receivables Balance
is an "eligible asset" as defined in Rule 3a-7 under the Investment Company
Act, of 1940, as amended and, in the case of clause (y) above, is not a
Receivable of the type described in clauses (i) through (iii) of the
definition of "Net Receivables Balance."
31
(m) Coverage Requirement; Amount of Receivables. The Percentage
Factor does not exceed the Maximum Percentage Factor.
(n) Credit and Collection Policy. Since July 10, 1997, there have
been no material changes in the Credit and Collection Policy other than as
permitted hereunder. Since such date, no material adverse change has
occurred in the overall rate of collection of the Receivables.
(o) Collections and Servicing. Since July 10, 1997, there has been no
material adverse change in the ability of the Collection Agent (to the
extent it is the Seller, the Transferor or any Subsidiary or Affiliate of
any of the foregoing) to service and collect the Receivables.
(p) No Termination Event. No event has occurred and is continuing and
no condition exists which constitutes a Termination Event or a Potential
Termination Event.
(q) Not an Investment Company. The Transferor is not, and is not
controlled by, an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or is exempt from all provisions of such
Act.
(r) ERISA. Each of the Transferor and its ERISA Affiliates is in
compliance in all material respects with ERISA and no lien exists in favor
of the Pension Benefit Guaranty Corporation on any of the Receivables.
(s) Special Account Banks and Concentration Bank. The names and
addresses of all the Special Account Banks (and, if applicable, the
Designated Account Agent in respect thereof) and the Concentration Account
Bank, together with the account numbers of the Special Accounts at such
Special Account Banks and the account number of the Concentration Account
of the Transferor at the Concentration Account Bank, are specified in
Exhibit C hereto (or at such other Special Account Banks or Concentration
Account Bank, with such other Special Accounts or Concentration Account or
with such other Designated Account Agents as have been notified to each
Administrative Agent in accordance with Section 5.2(e)). This Agreement,
together with the Concentration Account Agreement, is effective to, and
does, transfer to the Agent, for the benefit of the Investors, all right,
title and interest of the Transferor in and to the Concentration Account.
The Transferor has not granted to any Person (other than the Agent under
the Concentration Account Agreement) dominion and control over the
Concentration Account, or the right to take dominion and control over the
Concentration Account at a future time or upon the occurrence of a future
event; neither the Transferor nor any other Parent Group Member has granted
to any Person dominion and control over any Special Account, or the right
to take dominion or control over any Special Account at a future time or
upon the occurrence of a future event; and the Concentration Account and
each Special Account is otherwise free and clear of any Adverse Clam.
(t) Bulk Sales. No transaction contemplated hereby or by the
Receivables Purchase Agreement requires compliance with any bulk sales act
or similar law.
(u) Transfers Under Receivables Purchase Agreement. With respect to
each Receivable, and Related Security, if any, with respect thereto,
originally owed to the Seller or acquired by the Seller from any
Transferring Affiliate, the Transferor purchased such Receivable and
Related Security from the Seller under the Receivables Purchase Agreement,
such purchase was deemed to have been made on the date such Receivable was
credited or acquired by the Seller and such purchase was made strictly in
accordance with the terms of the Receivables Purchase Agreement.
(v) Preference; Voidability (Receivables Purchase Agreement). The
Transferor has given reasonably equivalent value to the Seller in
consideration for each transfer to the Transferor of Receivables and
Related Security from the Seller, and no such transfer has been made for or
on account of an antecedent debt owed by the Seller to the Transferor and
no such transfer is or may be voidable under any Section of the Bankruptcy
Code.
(w) Transfers by Transferring Affiliates. With respect to each
Receivable, and Related Security, if any, with respect thereto, originally
owed to any Transferring Affiliate, the Seller (i) purchased such
Receivable and Related Security from such Transferring Affiliate under the
Transferring Affiliate Letter or
32
from BMA under the BMA Transfer Agreement, such purchase being deemed to
have been made on the date such Receivable was created (or, in the case of
a Receivable outstanding on the Closing Date, on the Closing Date), (ii) by
the last Business Day of the month following the month in which such
purchase was so made, paid to the applicable Transferring Affiliate in cash
or by way of a credit to such Transferring Affiliate in the appropriate
intercompany account, an amount equal to the face amount of such Receivable
and (iii) settled from time to time each such credit, by way of payments in
cash, or by way of credits in amounts equal to cash expended, obligations
incurred or the value of services or property provided by or on behalf of
the Seller, in each case for the benefit of such Transferring Affiliate, to
the account of such Transferring Affiliate in accordance with the Seller's
and such Transferring Affiliate's cash management and accounting policies.
(x) Preference; Voidability (Transferring Affiliates). The Seller has
given reasonably equivalent value to each Transferring Affiliate in
consideration for each transfer to the Seller of Receivables and Related
Security from such Transferring Affiliate, and no such transfer has been
made for or on account of an antecedent debt owed by such Transferring
Affiliate to the Seller and no such transfer is or may be voidable under
any Section of the Bankruptcy Code.
(y) Ownership. FMCAG owns, directly or indirectly through a
wholly-owned Subsidiary, all of the issued and outstanding common stock of
(and such stock comprises more than 80% of the Voting Stock of) FMCH, free
and clear of any Adverse Claim except to the extent such stock is pledged
in connection with the FMCAG Bank Revolver. All of the issued and
outstanding stock of each Originating Entity is owned directly or
indirectly by FMCH, free and clear of any Adverse Claim except to the
extent such stock is pledged in connection with the FMCAG Bank Revolver.
All of the issued and outstanding stock of the Transferor is owned by NMC,
free and clear of any Adverse Claim.
(z) Representations and Warranties of the Seller. Each of the
representations and warranties of the Seller set forth in Section 3.1 of
the Receivables Purchase Agreement are true and correct in all material
respects and the Transferor hereby remakes all such representations and
warranties for the benefit of the Agent, each of the Investors and each
Administrative Agent.
Any document, instrument, certificate or notice delivered by the Transferor
to any Conduit Investor, Administrative Agent or the Agent hereunder shall be
deemed a representation and warranty by the Transferor.
Reaffirmation of Representations and Warranties by the Transferor. On each
day that a Transfer is made hereunder, the Transferor, by accepting the proceeds
of such Transfer, whether delivered to the Transferor pursuant to Section 2.2(a)
or Section 2.5 hereof, shall be deemed to have certified that all
representations and warranties described in Section 3.1 hereof are correct on
and as of such day as though made on and as of such day. Each Incremental
Transfer shall be subject to the further conditions precedent that:
(a) prior to the date of such Incremental Transfer, the Collection
Agent shall have delivered to the Agent and each Administrative Agent, in
form and substance satisfactory to the Agent and each Administrative Agent,
a completed Investor Report dated within ten (10) days prior to the date of
such Incremental Transfer, together with a listing by Primary Payor of all
Receivables, and such additional information as may be reasonably requested
by any Administrative Agent or the Agent;
(b) on date of such Incremental Transfer, either (i) FMCH's long-term
public senior debt securities are rated as least B- by Standard & Poor's
and B3 by Moody's, or if neither Standard & Poor's nor Moody's shall rate
such securities, FMCH's long-term senior debt shall have a deemed rating of
at least B as determined by each Administrative Agent using its standard
bond rating methodology, or (ii) FMCAG's long-term public senior debt
securities are rated as least B- by Standard & Poor's and B3 by ▇▇▇▇▇'▇
Investors Service, or if neither Standard & Poor's nor Moody's shall rate
such securities, FMCAG's long-term senior debt shall have deemed rating of
at least B as determined by each Administrative Agent using its standard
bond rating methodology,
and the Transferor shall be deemed to have represented and warranted that such
conditions precedent have been satisfied.
33
SECTION 3.2. Representations and Warranties of the Collection Agent. The
Collection Agent represents and warrants to the Agent, each Administrative Agent
and each of the Investors that:
(a) Corporate Existence and Power. The Collection Agent is a
corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation and has all corporate power and
all material governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its
business is now conducted. The Collection Agent is duly qualified to do
business in, and is in good standing in, every other jurisdiction in which
the nature of its business requires it to be so qualified, except where the
failure to be so qualified or in good standing would not have a Material
Adverse Effect.
(b) Corporate and Governmental Authorization; Contravention. The
execution, delivery and performance by the Collection Agent of this
Agreement are within the Collection Agent's corporate powers, have been
duly authorized by all necessary corporate action, require no action by or
in respect of, or filing with, any Official Body or official thereof, and
do not contravene, or constitute a default under, any provision of
applicable law, rule or regulation (including, without limitation, any
CHAMPUS/VA Regulation, any Medicaid Regulation or any Medicare Regulation)
or of the Certificate of Incorporation or Bylaws of the Collection Agent or
of any agreement, judgment, injunction, order, writ, decree or other
instrument binding upon the Collection Agent or result in the creation or
imposition of any Adverse Claim on the assets of the Collection Agent or
any of its Subsidiaries.
(c) Binding Effect. This Agreement constitutes the legal, valid and
binding obligation of the Collection Agent, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency, moratorium or
similar laws affecting the rights of creditors.
(d) Accuracy of Information. All information heretofore furnished by
the Collection Agent to the Agent, any Investor or any Administrative Agent
for the purposes of or in connection with this Agreement or any transaction
contemplated hereby is, and all such information hereafter furnished by the
Collection Agent to the Agent, any Investor or any Administrative Agent
will be, true and accurate in every material respect, on the date such
information is stated or certified.
(e) Action, Suits. Except as set forth in Exhibit H, there are no
actions, suits or proceedings pending, or to the knowledge of the
Collection Agent threatened, against or affecting the Collection Agent or
any Affiliate of the Collection Agent or their respect properties, in or
before any court, arbitrator or other body, which may, individually or in
the aggregate, have a Material Adverse Effect.
(f) Nature of Receivables. Each Receivable included in the
calculation of the Net Receivables Balance is not a Receivable of the type
described in clauses (i) through (iii) of the definition of "Net
Receivables Balance".
(g) Amount of Receivables. The Percentage Factor does not exceed the
Maximum Percentage Factor.
(h) Credit and Collection Policy. Since July 10, 1997, there have
been no material changes in the Credit and Collection Policy other than as
permitted hereunder. Since such date, no material adverse change has
occurred in the overall rate of collection of the Receivables.
(i) Collections and Servicing. Since July 10, 1997, there has been no
material adverse change in the ability of the Collection Agent to service
and collect the Receivables.
(j) Not an Investment Company. The Collection Agent is not, and is
not controlled by, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or is exempt from all
provisions of such Act.
(k) Special Accounts and Concentration Account. The names and
addresses of all the Special Account Banks (and, if applicable, the
Designated Account Agent in respect thereof) and the Concentration Account
Bank, together with the account numbers of the Special Accounts at such
Special Account Banks and the account number of the Concentration Account
of the Transferor at the Concentration Account Bank, are specified in
Exhibit C hereto (or at such other Special Account Banks or Concentration
Account Bank,
34
with such other Special Accounts or Concentration Account or with such
other Designated Account Agents as have been notified to the Agent in
accordance with Section 5.2(e)).
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1. Conditions to Closing. The effectiveness of this Agreement
shall be subject to the conditions precedent that (i) all fees required to be
paid on or prior to the date hereof pursuant to the Fee Letters or the separate
renewal or up-front fee letters entered into between the Transferor and the
respective Administrative Agents shall have been paid in full, (ii) Bank of
America shall have received payment in full of the Payout Amount under (and as
defined in) the Amendment Agreement and (iii) each Administrative Agent (or, in
the case of clause (n) below, the Administrative Agent(s) for the relevant
Conduit Investor(s)) shall have received the following documents, instruments
and agreements all of which shall be in a form and substance acceptable to each
Administrative Agent:
(a) A copy of the resolutions of the Board of Directors of the
Transferor certified by its Secretary approving the execution, delivery and
performance by the Transferor of this Agreement, the Receivables Purchase
Agreement and the other Transaction Documents to be delivered by the
Transferor hereunder or thereunder.
(b) A copy of the resolutions of the Board of Directors of the
Collection Agent certified by its Secretary approving the execution,
delivery and performance by the Collection Agent of this Agreement and the
other Transaction Documents to be delivered by the Collection Agent
hereunder or thereunder.
(c) The Certificates of Incorporation of the Transferor certified by
the Secretary of the Transferor dated a date reasonably prior to the
Closing Date.
(d) The Certificate of Incorporation of the Collection Agent certified
by the Secretary of the Collection Agent dated a date reasonably prior to
the Closing Date.
(e) A Good Standing Certificate for the Transferor issued by the
Secretary of State or a similar official of the Transferor's jurisdiction
of incorporation and certificates of qualification as a foreign corporation
issued by the Secretaries of State or other similar officials of each
jurisdiction where such qualification is material to the transactions
contemplated by this Agreement and the other Transaction Documents, in each
case, dated a date reasonably prior to the Closing Date.
(f) A Good Standing Certificate for the Collection Agent issued by the
Secretary of State or a similar official of the Collection Agent's
jurisdiction of incorporation and certificates of qualification as a
foreign corporation issued by the Secretaries of State or other similar
officials of each jurisdiction when such qualification is material to the
transactions contemplated by this Agreement and the Receivables Purchase
Agreement and the other Transaction Documents, in each case, dated a date
reasonably prior to the Closing Date.
(g) A Certificate of the Secretary of the Transferor substantially in
the form of Exhibit L attached hereto.
(h) A Certificate of the Secretary of the Collection Agent
substantially in the form of Exhibit L attached hereto.
(i) If requested by the Agent, copies of proper financing statements
(Form UCC-1), dated a date reasonably near to the Closing Date naming the
Transferor as the debtor in favor of the Agent, for the benefit of the
Investors, as the secured party or other similar instruments or documents
as may be necessary or in the reasonable opinion of the Agent desirable
under the UCC of all appropriate jurisdictions or any comparable law to
perfect the Agent's undivided percentage interest in all Receivables and
the Related Security and Collections relating thereto.
35
(j) An opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Vice President/Deputy General
Counsel for FMCH, NMC and each Transferring Affiliate, acting as counsel to
FMCH, the Transferor, the Collection Agent and the Originating Entities, in
the respective form attached in Exhibit K hereto.
(k) An opinion of Arent Fox ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC special
counsel to FMCAG, FMCH, the Transferor and the Seller, covering certain
bankruptcy and general corporate matters in the respective forms attached
in Exhibit K hereto.
(l) An executed copy of this Agreement and each of the other
Transaction Documents to be executed by the Transferor, any Originating
Entity or the Collection Agent.
(m) Amendments to the Parent Agreement, the Receivables Purchase
Agreement, the Transferring Affiliate Letter and the Concentration Account
Agreement, in the respective forms attached hereto as Exhibit P, duly
executed by each of the parties thereto.
(n) To the extent requested by any Conduit Investor, confirmation from
each Rating Agency rating the Commercial Paper of such Conduit Investor
that the execution and delivery of this Agreement and the transactions
contemplated hereby will not result in the reduction or withdrawal of the
then current rating of the Commercial Paper issued by such Conduit
Investor.
(o) Drafts of (i) the agreed upon procedures report from KPMG in
substantially the form attached as Exhibit T and (ii) the "not material
weakness" report from KPMG in substantially the form attached as Exhibit U,
in each case satisfactory to the Administrative Agents.
(p) Such other documents, instruments, certificates and opinions as
the Agent or any Administrative Agent shall reasonably request including
each of the documents, instruments, certificates and opinion identified on
the List of Closing Documents attached hereto as Exhibit S.
ARTICLE V
COVENANTS
SECTION 5.1. Affirmative Covenants of Transferor. At all times from the
date hereof to the later to occur of (i) the Termination Date or (ii) the date
on which the Net Investment has been reduced to zero, all accrued Discount and
Servicing Fees shall have been paid in full and all other Aggregate Unpaids
shall have been paid in full, in cash, unless each Administrative Agent shall
otherwise consent in writing:
(a) Financial Reporting. The Transferor will, and will cause the
Seller and each of the Transferring Affiliates to, maintain, for itself and
each of its respective Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish to each Administrative
Agent:
(i) Annual Reporting. As soon as available, but in any event
within ninety-five (95) days after the end of each fiscal year of the
Transferor, financial statements for the Transferor, including a balance
sheet as of the end of such period, the related statement of income,
retained earnings, shareholders' equity and cash flows for such year
prepared by the Transferor in accordance with GAAP and reviewed by a
nationally recognized accounting firm accompanied by a certificate of
said accountants that, in the course of the foregoing, they have
obtained no knowledge of any Termination Event or Potential Termination
Event, or if, in the opinion of such accountants, any Termination Event
or Potential Termination Event shall exist, stating the nature and
status thereof.
(ii) Quarterly Reporting. As soon as available, but in any event
within fifty (50) days after the end of each of the first three
quarterly periods of the Transferor's fiscal years, financial statements
for the Transferor, including a balance sheet as at the close of each
such period and a related statement of income and retained earnings for
the period from the beginning of such fiscal year to the end of such
quarter, all certified by its chief executive officer or its senior
financial officer.
In the case of each of the financial statements required to be
delivered under clause (i) or (ii) above, such financial statement shall
set forth in comparative form the figures for the corresponding
36
period or periods of the preceding fiscal year or the portion of the
fiscal year ending with such period, as applicable (but not for any
period prior to the Closing Date), in each case subject to normal
recurring year-end audit adjustments. Each such financial statement
shall be prepared in accordance with GAAP consistently applied.
(iii) Compliance Certificate. Together with the financial
statements required hereunder, a compliance certificate signed by the
Transferor's chief executive officer or its senior financial officer
stating that (x) the attached financial statements have been prepared in
accordance with GAAP and accurately reflect the financial condition of
the Transferor and (y) to the best of such Person's knowledge, no
Termination Event or Potential Termination Event exists, or if any
Termination Event or Potential Termination Event exists, stating the
nature and status thereof and (z) such Person has reviewed each Investor
Report prepared by the Collection Agent since the end of the last day of
the immediately preceding monthly period of the Transferor's fiscal year
and the information upon which each such Investor Report was based and,
based on such review, such Person has concluded that (1) the calculation
of the Net Receivables Balance (including, without limitation, the
calculation of each of the items described in clauses (i) through (iv)
of the definition of "Net Receivables Balance") by the Collection Agent
in each such Investor Report is accurate and complete in all material
respects and (2) each such Investor Report is otherwise accurate and
complete in all material respects.
(iv) Notice of Termination Events or Potential Termination
Events. As soon as possible and in any event within two (2) days (or
the next Business Day thereafter if such day is not a Business Day)
after the occurrence of each Termination Event or each Potential
Termination Event, a statement of the chief executive officer or the
senior financial officer of the Transferor setting forth details of such
Termination Event or Potential Termination Event and the action which
the Transferor proposes to take with respect thereto.
(v) Change in Credit and Collection Policy and Debt
Ratings. Within ten (10) days after the date any material change in or
amendment to the Credit and Collection Policy is made, a copy of the
Credit and Collection Policy then in effect indicating such change or
amendment.
(vi) Credit and Collection Policy. Within ninety (90) days after
the close of each of the Seller's and the Transferor's fiscal years, a
complete copy of the Credit and Collection Policy then in effect.
(vii) ERISA. Promptly after the filing or receiving thereof,
copies of all reports and notices with respect to any Reportable Event
(as defined in Article IV of ERISA) which the Transferor, the Seller or
any ERISA Affiliate of the Transferor or the Seller files under ERISA
with the Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or which the Transferor, the
Seller or any ERISA Affiliates of the Transferor or the Seller receives
from the Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor.
(viii) Notices under Transaction Documents. Forthwith upon its
receipt thereof, a copy of each notice, report, financial statement,
certification, request for amendment, directive, consent, waiver or
other modification or any other writing issued under or in connection
with any other Transaction Document by any party thereto (including,
without limitation, by the Transferor).
(ix) Investigations and Proceedings. Unless prohibited by either
(i) the terms of the subpoena, request for information or other document
referred to below, (ii) law (including, without limitation, rules and
regulations) or (iii) restrictions imposed by the U.S. federal or state
government or any agency or instrumentality thereof and subject to the
execution by the applicable Administrative Agent of a confidentiality
agreement in form and substance satisfactory to both the Transferor and
such Administrative Agent, as soon as possible and in any event (A)
within three Business Days after the Transferor (or within five Business
Days after any Originating Entity) receives any subpoena, request for
information, or any other document relating to any possible violation by
the Transferor or any Originating Entity of, or failure by the
Transferor or any Originating Entity to comply with, any rule,
regulation or statute from HHS or any other governmental agency or
instrumentality, notice of such receipt and, if requested by the Agent,
the information contained in, or copies of, such subpoena,
37
request or other document, and (B) periodic updates and other management
reports relating to the subpoenas, requests for information and other
documents referred to in clause (A) above as may be reasonably requested
by any Administrative Agent unless such updates or requests could
reasonably be deemed a contravention or waiver of any available claim of
legal privilege, or would otherwise materially impair available
defenses, of the Transferor or any Originating Entity.
(x) Other Information. Such other information (including
non-financial information) as the Agent or any Administrative Agent may
from time to time reasonably request with respect to the Seller, the
Transferor, any party to the Parent Agreement, any Transferring
Affiliate or any Subsidiary of any of the foregoing.
(b) Conduct of Business. The Transferor (i) will carry on and conduct
its business in substantially the same manner and in substantially the same
fields of enterprise as it is presently conducted and do all things
necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of incorporation and
maintain all requisite authority to conduct its business in each
jurisdiction in which its business is conducted and (ii) will cause each
Originating Entity to do each of the foregoing in respect of such
Originating Entity.
(c) Compliance with Laws. The Transferor will, and will cause each
Originating Entity to, comply with all laws, rules and regulations
(including, without limitation, all CHAMPUS/VA Regulations, Medicaid
Regulations and Medicare Regulations), and all orders, writs, judgments,
injunctions, decrees or awards to which it or its respective properties may
be subject.
(d) Furnishing of Information and Inspection of Records. The
Transferor will, and will cause each Originating Entity to, furnish to each
Administrative Agent from time to time such information with respect to the
Receivables as such Administrative Agent may reasonably request, including,
without limitation, listings identifying the Obligor and the Outstanding
Balance for each Receivable. The Transferor will, and will cause each
Originating Entity to, at any time and from time to time during regular
business hours permit any Administrative Agent, or its agents or
representatives, (i) to examine and make copies of and take abstracts from
Records and (ii) to visit the offices and properties of the Transferor or
such Originating Entity, as applicable, for the purpose of examining such
Records, and to discuss matters relating to Receivables or the Transferor's
or such Originating Entity's performance hereunder and under the other
Transaction Documents to which such Person is a party with any of the
officers, directors, employees or independent public accountants of the
Transferor or such Originating Entity, as applicable, having knowledge of
such matters.
(e) Keeping of Records and Books of Account. The Transferor will, and
will cause each Originating Entity to, 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 daily identification of each new
Receivable and all Collections of and adjustments to each existing
Receivable). The Transferor will, and will cause each Originating Entity
to, give each Administrative Agent notice of any material change in the
administrative and operating procedures of the Transferor or such
Originating Entity, as applicable, referred to in the previous sentence.
(f) Performance and Compliance with Receivables and Contracts. The
Transferor, at its expense, will, and will cause each Originating Entity
to, timely and fully perform and comply with all material provisions,
covenant and other promises required to be observed by the Transferor or
such Originating Entity under the Contracts related to the Receivables.
(g) Credit and Collection Policies. The Transferor will, and will
cause each Originating Entity to, comply in all material respects with the
Credit and Collection Policy in regard to each Receivable and the related
Contract.
(h) Special Accounts; Concentration Account. The Transferor shall (i)
cause each Originating Entity to establish and maintain Special Accounts
with Special Account Banks, or to engage a Designated Account
38
Agent to maintain a Special Account with a Special Account Bank on its
behalf, (ii) instruct, and cause each Originating Entity to instruct, all
Obligors to cause all collections to be deposited directly into a Special
Account, (iii) report, and cause each Originating Entity to report, on each
banking day to the Concentration Account Bank, the amount of all
Collections on deposit on such banking day in the Special Accounts at each
Special Account Bank, (iv) establish and maintain a Concentration Account
with the Concentration Account Bank, (v) instruct, and cause each
Originating Entity to instruct (or to cause the applicable Designated
Account Agent to instruct), each Special Account Bank to transfer to the
Concentration Account prior to the close of business on such banking day
all Collections on deposit during such banking day in the Special Accounts
at such Special Account Bank, and (vi) instruct the Concentration Account
Bank to give to each Special Account Bank on each banking day notice to
transfer to the Concentration Account all Collections on deposit during
such banking day in the Special Accounts at such Special Account Bank;
provided, however, that if the Collections on deposit in any Special
Account during such banking day shall be less than $5,000.00 (the "Minimum
Amount"), the Special Account Bank shall transfer such Collections to the
Concentration Account on the next succeeding banking day on which
Collections in such Special Account first exceed the Minimum Amount. With
respect to any Special Account that is located at or maintained by a Bank
Investor hereunder, the Transferor shall, by not later than the date that
occurs six months after the Closing Date, cause the applicable Originating
Entity to close such Special Account and shall instruct, and shall cause
each applicable Originating Entity to instruct, all Obligors theretofore
remitting payments to such Special Account to remit all future payments on
Receivables and Related Security to a Special Account located at and
maintained by a financial institution that is not a Bank Investor.
(i) Collections Received. The Transferor shall, and shall cause each
Originating Entity to, segregate and hold in trust, and deposit,
immediately, but in any event not later than the day that occurs
forty-eight (48) hours thereafter (or, if such day is not a Business Day,
the next Business Day) after its receipt thereof, to the Concentration
Account all Collections received from time to time by the Transferor or
such Originating Entity, as the case may be.
(j) Sale Treatment. The Transferor will not (i) and will not permit
any Originating Entity to, account for (including for accounting and tax
purposes), or otherwise treat, the transactions contemplated by the
Receivables Purchase Agreement, the Transferring Affiliate Letter or the
BMA Transfer Agreement in any manner other than as a sale of Receivables by
the applicable Originating Entity to the Seller or Transferor, as
applicable, or (ii) account for (other than for tax purposes) or otherwise
treat any transactions contemplated hereby in any manner other than as a
sale of Receivables by the Transferor to the Agent on behalf of the
applicable Investors. In addition, the Transferor shall, and shall cause
each Originating Entity to, disclose (in a footnote or otherwise) in all of
its respective financial statements (including any such financial
statements consolidated with any other Persons' financial statements) the
existence and nature of the transaction contemplated hereby, by the
Receivables Purchase Agreement, by the Transferring Affiliate Letter and by
the BMA Transfer Agreement, and the interest of the Transferor (in the case
of the Seller's financial statements), and the Agent, on behalf of the
Investors, in the Affected Assets.
(k) Separate Business. The Transferor shall at all times (a) to the
extent the Transferor's office is located in the offices of any Parent
Group Member, pay fair market rent for its executive office space located
in the offices of such Parent Group Member, (b) have at all times at least
one member of its board of directors which is not and has never been an
employee, officer or director of any Parent Group Member or of any major
creditor of any Parent Group Member and is a person who is and has
experience with asset securitization, (c) maintain the Transferor's books,
financial statements, accounting records and other corporate documents and
records separate from those of any Parent Group Member or any other entity,
(d) not commingle the Transferor's assets with those of any Parent Group
Member or any other entity, (e) act solely in its corporate name and
through its own authorized officers and agents, (f) make investments
directly or by brokers engaged and paid by the Transferor its agents
(provided that if any such agent is an Affiliate of the Transferor it shall
be compensated at a fair market rate for its services), (g) separately
manage the Transferor's liabilities from those of the Parent Group and pay
its own liabilities, including all administrative expenses, from its own
separate assets, except that the Seller may pay the organizational expenses
of the Transferor, and (h) pay from the Transferor's assets all obligations
and indebtedness of any
39
kind incurred by the Transferor. The Transferor shall abide by all
corporate formalities, including the maintenance of current minute books,
and the Transferor shall cause its financial statements to be prepared in
accordance with GAAP in a manner that indicates the separate existence of
the Transferor and its assets and liabilities. The Transferor shall (i) pay
all its liabilities, (ii) not assume the liabilities of any Parent Group
Member, (iii) not lend funds or extend credit to any Parent Group Member
except pursuant to the Receivables Purchase Agreement in connection with
the purchase of Receivables thereunder and (iv) not guarantee the
liabilities of any Parent Group Member. The officers and directors of the
Transferor (as appropriate) shall make decisions with respect to the
business and daily operations of the Transferor independent of and not
indicated by any controlling entity. The Transferor shall not engage in any
business not permitted by its Certificate of Incorporation as in effect on
the Closing Date. The Transferor shall, in addition to the foregoing, take
such other actions as are necessary on its part to ensure that the facts
and assumptions set forth in the opinions issued by Arent Fox ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇, as counsel for the Transferor, in connection with the
closing or initial Transfer under this Agreement and relating to "non-
consolidation" issues and "true sale" issues, and in the certificates
accompanying such opinions, remain true and correct in all material
respects at all times.
(l) Corporate Documents. The Transferor shall only amend, alter,
change or repeal any provision of the Third, Fifth, Seventh, Tenth,
Eleventh or Twelfth Article of its Certificate of Incorporation with the
prior written consent of each Administrative Agent.
(m) Payment to the Originating Entities. With respect to any
Receivable purchased by the Transferor from the Seller, such sale shall be
effected under, and in strict compliance with the terms of, the Receivables
Purchase Agreement, including, without limitation, the terms relating to
the amount and timing of payments to be made to the Seller by the
Transferor in respect of the purchase price for such Receivable. With
respect to any Receivable purchased by the Seller from any Transferring
Affiliate, the Transferor shall cause such sale to be effected under, and
in strict compliance with the terms of, the Transferring Affiliate Letter
and the BMA Transfer Agreement, as applicable, including, without
limitation, the terms relating to the amount and timing of payments to be
made to each Transferring Affiliate in respect of the purchase price for
such Receivable.
(n) Performance and Enforcement of the Receivables Purchase Agreement,
etc. The Transferor shall timely perform the obligations required to be
performed by the Transferor, and shall vigorously enforce the rights and
remedies accorded to the Transferor, under the Receivables Purchase
Agreement. The Transferor shall cause the Seller to timely perform the
obligations required to be performed by the Seller, and shall cause the
Seller to vigorously enforce the rights and remedies accorded to the
Seller, under each of the Transferring Affiliate Letter and the BMA
Transfer Agreement. The Transferor shall take all actions to perfect and
enforce its rights and interests (and the rights and interests of the
Agent, each Administrative Agent and each of the Investors, as assignees of
the Transferor) under the Receivables Purchase Agreement as any
Administrative 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
Purchase Agreement. The Transferor shall cause the Seller to take all
actions to perfect and enforce the Seller's rights and interests (and the
rights and interests of the Transferor, the Agent, the Administrative Agent
and each of the Investors, as assignees of the Seller) under the
Transferring Affiliate Letter or the BMA Transfer Agreement as any
Administrative 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 Transferring
Affiliate Letter or the BMA Transfer Agreement.
SECTION 5.2. Negative Covenants of the Transferor. At all times from the
date hereof to the later to occur of (i) the Termination Date or (ii) the date
on which the Net Investment has been reduced to zero, all accrued Discount and
Servicing Fees shall have been paid in full and all other Aggregate Unpaids
shall have been paid in full, in cash, unless each Administrative Agent shall
otherwise consent in writing:
(a) No Sales, Liens, Etc. Except as otherwise provided herein and in
the Receivables Purchase Agreement, the Transferor will not, and will not
permit any Originating Entity to, sell, assign (by operation
40
of law or otherwise) or otherwise dispose of, or create or suffer to exist
any Adverse Claim upon (or the filing of any financing statement) or with
respect to (x) any of the Affected Assets, (y) any inventory or goods, the
sale of which may give rise to a Receivable or any Receivable or related
Contract, or (z) any Special Account or the Concentration Account or any
other account to which any Collections of any Receivable are sent, or
assign any right to receive income in respect thereof.
(b) No Extension or Amendment of Receivables. Except as otherwise
permitted in Section 6.2 hereof, the Transferor will not, and will not
permit any Originating Entity to, extend, amend or otherwise modify the
terms of any Receivable, or amend, modify or waive any term or condition of
any Contract related thereto.
(c) No Change in Business or Credit and Collection Policy. The
Transferor will not, and will not permit any Originating Entity to, make
any change in the character of its business or in the Credit and Collection
Policy, which change would, in either case, impair the collectibility of
any Receivable or otherwise have a Material Adverse Effect.
(d) No Mergers, Etc. The Transferor will not, and will not permit any
Originating Entity to, merge with or into or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one transaction
or in a series of transactions), all or substantially all of its assets
(whether now owned or hereafter acquired and except as contemplated in the
Transaction Documents) to any Person, except that (i) any Transferring
Affiliate may merge or consolidate with any other Transferring Affiliate
and (ii) the Seller may merge or consolidate with any other Person if, but
only if, (x) immediately after giving effect to such merger or
consolidation, no Termination Event or Potential Termination Event would
exist and (y) if the Seller is not the surviving corporation, each
Administrative Agent shall have received a written agreement, in form and
substance satisfactory to such Administrative Agent, executed by the Person
resulting from such merger or consolidation, under which agreement such
Person shall become the Seller and Collection Agent, and shall assume the
duties, obligations and liabilities of the Seller, under the Receivables
Purchase Agreement, this Agreement (in its capacity as Collection Agent
hereunder), the Special Account Letters and each other Transaction Document
to which the Seller is party (whether in its individual capacity or as
Collection Agent), together with the documents relating to the Seller of
the kind delivered by or on behalf of the Seller pursuant to Section 3.1.
(e) Change in Payment Instructions to Obligors, Special Account Banks,
Designated Account Agents and Concentration Account. The Transferor will
not, and will not permit any Originating Entity to:
(i) add or terminate any bank as a Special Account Bank from those
listed in Exhibit C hereto, or make any change in its instructions to
Obligors regarding payments to be made to any Special Account Bank;
provided that the Transferor may permit the (A) addition of any bank as
a Special Account Bank for purposes of this Agreement at any time
following delivery to each Administrative Agent of written notice of
such addition and a Special Account Letter duly executed by such bank,
and (B) termination of any Special Account Bank at any time following
delivery to each Administrative Agent of written notice of such
termination and evidence satisfactory to each Administrative Agent that
the affected Obligors shall have been instructed to remit all subsequent
Collections to another Special Account; or
(ii) add, terminate or change the Concentration Account, or any
bank as the Concentration Account Bank, from that listed in Exhibit C
hereto, or make any change in the instructions contained in any Special
Account Letter or any change in the instructions to the Concentration
Account Bank; provided, however, that the Transferor may terminate the
then existing Concentration Account Bank and appoint a new Concentration
Account Bank if, prior to such termination and appointment, each
Administrative Agent shall receive (i) ten Business Days' prior notice
of such termination and appointment and (ii) prior to the effective date
of such termination and appointment, (x) executed copies of Special
Account Letters (in each case, executed by the applicable Originating
Entity and the applicable Special Account Bank) instructing the Special
Account Banks to transfer to the new Concentration Account prior to the
close of business on each banking day all Collections on deposit during
such banking day in the Special Accounts at the Special Account Banks,
and (y) a copy of a Concentration Account Agreement executed by the new
Concentration Account Bank and the Transferor; or
41
(iii) add or terminate any Person as a Designated Account Agent
from those listed in Exhibit C hereto, or make any change in its
instructions to such Designated Account Agent regarding the handling of
the Collections in the applicable Special Account; provided that the
Transferor may permit the (A) addition of any Person that satisfies the
requirements set forth herein of a "Designated Account Agent" as a
Designated Account Agent for purposes of this Agreement at any time
following delivery to each Administrative Agent of written notice of
such addition and an Account Agent Agreement duly executed by such
Person, and (B) termination of any Designated Account Agent at any time
following delivery to each Administrative Agent of written notice of
such termination and evidence satisfactory to each Administrative Agent
that either an Originating Entity or a new Designated Account Agent
shall have been added in accordance with the terms of this Agreement to
succeed such terminated Designated Account Agent in respect of the
applicable Special Account or the affected Obligors shall have been
instructed to remit all subsequent Collections to another Special
Account.
(f) Deposits to Special Accounts and the Concentration Account. The
Transferor will not, and will not permit any of the Originating Entities or
Designated Account Agents to, deposit or otherwise credit, or cause or
permit to be so deposited or credited, to any Special Account or the
Concentration Account cash or cash proceeds other than Collections of
Receivables.
(g) Change of Name, Etc. The Transferor will not, and will not permit
any Originating Entity to, change its name, identity or structure or the
location of its chief executive office or jurisdiction of organization,
unless at least 10 days prior to the effective date of any such change the
Transferor delivers to each Administrative Agent (i) such documents,
instruments or agreements, executed by the Transferor and/or the affected
Originating Entities, as are necessary to reflect such change and to
continue the perfection of the Agent's ownership interests or security
interest in the Affected Assets and (ii) new or revised Special Account
Letters executed by the Special Account Banks which reflect such change and
enable the Agent to continue to exercise its rights contained in Section
2.8 hereof. The Transferor will not, and will not permit any Originating
Entity to, change its jurisdiction of organization to a jurisdiction other
than a State within the United States.
(h) Amendment to Receivables Purchase Agreement, Etc. The Transferor
will not, and will not permit any Originating Entity to, (i) amend, modify,
or supplement the Receivables Purchase Agreement, the Transferring
Affiliate Letter, the BMA Transfer Agreement or any instrument, document or
agreement executed in connection therewith (collectively the "Initial
Transfer Documents"), (ii) terminate or cancel any Initial Transfer
Document, (iii) issue any consent or directive under any Initial Transfer
Document, (iv) undertake any enforcement proceeding in respect of any of
the Initial Transfer Documents, or (v) waive, extend the time for
performance or grant any indulgence in respect of any provision of any
Initial Transfer Document, in each case except with the prior written
consent of the Agent and each Administrative Agent; nor shall the
Transferor take, or permit any Originating Entity to take, any other action
under any of the Initial Transfer Documents that shall have a material
adverse affect on the Agent, any Administrative Agent or any Investor or
which is inconsistent with the terms of this Agreement.
(i) Other Debt. Except as provided for herein, the Transferor will
not create, incur, assume or suffer to exist any indebtedness whether
current or funded, or any other liability other than (i) indebtedness of
the Transferor representing fees, expenses and indemnities arising
hereunder or under the Receivables Purchase Agreement for the purchase
price of the Receivables under the Receivables Purchase Agreement, and (ii)
other indebtedness incurred in the ordinary course of its business in an
amount not to exceed $50,000 at any time outstanding.
(j) ERISA Matters. The Transferor will not, and will not permit any
Originating Entity to, (i) engage or permit any of its respective ERISA
Affiliates to engage in any prohibited transaction (as defined in Section
4975 of the Code and Section 406 of ERISA) for which an exemption is not
available or has not previously been obtained from the U.S. Department of
Labor; (ii) permit to exist any accumulated funding deficiency (as defined
in Section 302(a) of ERISA and Section 412(a) of the Code) or funding
deficiency with respect to any Benefit Plan other than a Multiemployer
Plan; (iii) fail to make any payments to any Multiemployer Plan that the
Transferor, such Originating Entity or any ERISA Affiliate thereof is
required
42
to make under the agreement relating to such Multiemployer Plan or any law
pertaining thereto; (iv) terminate any Benefit Plan so as to result in any
liability; or (v) permit to exist any occurrence of any reportable event
described in Title IV of ERISA which represents a material risk of a
liability to the Transferor, such Originating Entity or any ERISA Affiliate
thereof under ERISA or the Code, if such prohibited transactions,
accumulated funding deficiencies, payments, terminations and reportable
events occurring within any fiscal year of the Transferor, in the
aggregate, involve a payment of money or an incurrence of liability by the
Transferor, any Originating Entity or any ERISA Affiliate thereof, in an
amount in excess of $500,000.
SECTION 5.3. Affirmative Covenants of the Collection Agent. At all times
from the date hereof to the later to occur of (i) the Termination Date or (ii)
the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless each Administrative Agent
shall otherwise consent in writing.
(a) Conduct of Business. The Collection Agent will carry on and
conduct its business in substantially the same manner and in substantially
the same fields of enterprise as it is presently conducted and do all
things necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of incorporation and
maintain all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.
(b) Compliance with Laws. The Collection Agent will comply with all
laws, rules and regulations (including, without limitation, all CHAMPUS/VA
Regulations, Medicaid Regulations and Medicare Regulations), and all
orders, writs, judgments, injunctions, decrees or awards to which it or its
respective properties may be subject.
(c) Furnishing of Information and Inspection of Records. The
Collection Agent will furnish to each Administrative Agent from time to
time such information with respect to the Receivables as such
Administrative Agent may reasonably request, including, without limitation,
listings identifying the Obligor and the Outstanding Balance for each
Receivable. The Collection Agent will, at any time and from time to time
during regular business hours permit any Administrative Agent, or its
agents or representatives, (i) to examine and make copies of and take
abstracts from all Records and (ii) to visit the offices and properties of
the Collection Agent for the purpose of examining such records, and to
discuss matters relating to Receivables or the Transferor's, the
Originating Entities' or the Collection Agent's performance hereunder and
under the other Transaction Documents to which such Person is a party with
any of the officers, directors, employees or independent public accountants
of the Collection Agent having knowledge of such matters.
(d) Keeping of Records and Books of Account. The Collection Agent
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 daily
identification of each new Receivable and all Collections of and
adjustments to each existing Receivable). The Collection Agent will give
each Administrative Agent notice of any material change in the
administrative and operating procedures of the Collection Agent referred to
in the previous sentence.
(e) Notice of Agent's Interest. The Collection Agent shall cause its
master data processing records, computer tapes, files and other documents
or instruments provided to, developed by or otherwise maintained by the
Collection Agent in connection with any Transfer or otherwise for purposes
of the transactions contemplated in this Agreement to disclose
conspicuously the Transferor's ownership of the Receivables and the Agent's
interest therein.
(f) Credit and Collection Policies. The Collection Agent will comply
in all material respects with the Credit and Collection Policy in regard to
each Receivable and the related Contract.
(g) Collections. The Collection Agent shall instruct all Obligors to
cause all Collections to be deposited directly to a Special Account and
shall take, or omit to take, all actions in respect of Obligors, the
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Special Account Banks and the Concentration Account Bank solely in a manner
that is consistent with the terms of this Agreement, including, without
limitation, Sections 2.8, 5.1(h), 5.2(e) and 5.2(f) hereof.
(h) Collections Received. The Collection Agent shall segregate and
hold in trust, and deposit, immediately, but in any event not later than
the day that occurs forty-eight (48) hours thereafter (or, if such day is
not a Business Day, the next Business Day) after its receipt thereof, to
the Concentration Account all Collections received from time to time by the
Collection Agent.
SECTION 5.4. Negative Covenants of the Collection Agent. At all times
from the date hereof to the later to occur of (i) the Termination Date or (ii)
the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless each Administrative Agent
shall otherwise consent in writing:
(a) No Extension or Amendment of Receivables. Except as otherwise
permitted in Section 6.2 hereof, the Collection Agent will not extend,
amend or otherwise modify the terms of any Receivable, or amend, modify or
waive any term or condition of any Contract related thereto.
(b) No Change in Business or Credit and Collection Policy. The
Collection Agent will not make any change in the character of its business
or in the Credit and Collection Policy, which change would, in either case,
impair the collectibility of any Receivable or otherwise have a Material
Adverse Effect.
(c) No Mergers, Etc. Except as otherwise permitted under Section
5.2(d), the Collection Agent will not (i) consolidate or merge with or into
any other Person, or (ii) sell, lease or transfer all or substantially all
of its assets to any other Person.
(d) Deposits to Accounts. The Collection Agent will not deposit or
otherwise credit, or cause or permit to be so deposited or credited, to any
Special Account or Concentration Account cash or cash proceeds other than
Collections of Receivables.
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.1. Appointment of Collection Agent. The servicing,
administering and collection of the Receivables shall be conducted by such
Person (the "Collection Agent") so designated from time to time in accordance
with this Section 6.1. Until the Agent gives notice to the Transferor of the
designation of a new Collection Agent, NMC is hereby designated as, and hereby
agrees to perform the duties and obligations of, the Collection Agent pursuant
to the terms hereof. The Collection Agent may not delegate any of its rights,
duties or obligations hereunder, or designate a substitute Collection Agent,
without the prior written consent of each Administrative Agent; provided that
the Collection Agent may from time to time delegate to any Originating Entity
such of its rights, duties and obligations hereunder as relate to the servicing,
administering and collection of the Receivables originated by such Originating
Entity; provided further that (i) any such delegation shall be terminated upon
the replacement of the Collection Agent hereunder and (ii) the Collection Agent
shall continue to remain solely liable for the performance of the duties as
Collection Agent hereunder notwithstanding any such delegation hereunder. The
Agent may, and upon the direction of the Majority Investors the Agent shall,
after the occurrence of a Collection Agent Default or any other Termination
Event designate as Collection Agent any Person (including itself) to succeed NMC
or any successor Collection Agent, on the conditions in each case that any such
Person so designated shall agree to perform the duties and obligations of the
Collection Agent pursuant to the terms hereof and such designation of such
Person is permitted by applicable law (including, without limitation, applicable
CHAMPUS/VA Regulations, Medicaid Regulations and Medicare Regulations) or any
order of a court of competent jurisdiction. The Agent may notify any Obligor as
to the ownership interest therein that shall have been transferred to the
Transferor and, except as otherwise provided hereunder, as to the Transferred
Interest hereunder.
SECTION 6.2. Duties of Collection Agent.
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(a) The Collection Agent shall take or cause to be taken all such action as
may be necessary or advisable to collect each Receivable from time to time, all
in accordance with applicable laws, rules and regulations (including, without
limitation, all CHAMPUS/VA Regulations, Medicaid Regulations and Medicare
Regulations), with reasonable care and diligence, and in accordance with the
Credit and Collection Policy. Each of the Transferor, the Agent, the
Administrative Agents and the Investors hereby appoints as its agent the
Collection Agent, from time to time designated pursuant to Section 6.1 hereof,
to enforce its respective rights and interests in and under the Affected Assets.
To the extent permitted by applicable law, the Transferor hereby grants to any
Collection Agent appointed hereunder an irrevocable power of attorney to take
any and all steps in the Transferor's and/or any Originating Entity's name and
on behalf of the Transferor necessary or desirable, in the reasonable
determination of the Collection Agent, to collect all amounts due under any and
all Receivables, including, without limitation, endorsing the Transferor's
and/or any Originating Entity's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Contracts. The Transferor represents and warrants that the foregoing power of
attorney, in the case of any Originating Entity, has been duly granted to the
Transferor under the Receivables Purchase Agreement and the Transferor is
authorized under the Receivables Purchase Agreement, to the extent permitted by
applicable law, to authorize the Collection Agent hereunder to exercise such
power. The Collection Agent shall set aside for the account of the Transferor
and the Agent (for the benefit of the Investors) their respective allocable
shares of the Collections of Receivables in accordance with Sections 2.5 and 2.6
hereof. The Collection Agent shall segregate and deposit to each Administrative
Agent's account such Administrative Agent's allocable share of Collections of
Receivables when required pursuant to Article II hereof. So long as no
Termination Event shall have occurred and be continuing, the Collection Agent
may, in accordance with the Credit and Collection Policy, extend the maturity or
adjust the Outstanding Balance of any Defaulted Receivable as the Collection
Agent may determine to be appropriate to maximize Collections thereof; provided,
however, that such extension or adjustment shall not alter the status of such
Receivable as a Defaulted Receivable. The Transferor shall deliver to the
Collection Agent and the Collection Agent shall hold in trust for the
Transferor, and the Agent, on behalf of the Investors, in accordance with their
respective interests, all Records which evidence or relate to Receivables or
Related Security. Notwithstanding anything to the contrary contained herein, the
Agent shall have the absolute and unlimited right to direct the Collection Agent
(whether the Collection Agent is NMC or any other Person) to commence or settle
any legal action to enforce collection of any Receivable or to foreclose upon or
repossess any Related Security. The Collection Agent shall not make the Agent,
any Administrative Agent or any of the Investors a party to any litigation
without the prior written consent of such Person.
(b) The Collection Agent shall, as soon as practicable following receipt
thereof, turn over to the Transferor any collections of any indebtedness of any
Person which is not on account of a Receivable. If the Collection Agent is not
NMC or an Affiliate thereof, the Collection Agent, by giving three Business
Days' prior written notice to the Agent, may revise the percentage used to
calculate the Servicing Fee so long as the revised percentage will not result in
a Servicing Fee that exceeds 110% of the reasonable and appropriate out-of
pocket costs and expenses of such Collection Agent incurred in connection with
the performance of its obligations hereunder as documented to the reasonable
satisfaction of each Administrative Agent, provided, however, that at any time
after the Percentage Factor equals or exceeds 98%, any compensation to the
Collection Agent in excess of the Servicing Fee initially provided for herein
shall be an obligation of the Transferor and shall not be payable, in whole or
in part, from the Collections allocated to or for the benefit of any of the
Investors hereunder. The Collection Agent, if other than NMC, shall as soon as
practicable upon demand, deliver to the Transferor all Records in its possession
which evidence or relate to indebtedness of an Obligor which is not a
Receivable.
(c) On or before June 30, 2004 the Collection Agent shall cause a firm of
independent public accountants (who may also render other services to the
Collection Agent, the Transferor, the Seller or any Affiliates of any of the
foregoing), or such other Person as may be approved by each Administrative Agent
(any of the foregoing being an "Auditor"), to furnish a report to each
Administrative Agent in accordance with the procedures set forth on Schedule
III.
(d) Notwithstanding anything to the contrary contained in this Article VI,
the Collection Agent, if not the Transferor or NMC, shall have no obligation to
collect, enforce or take any other action described in this Article VI with
respect to any indebtedness that is not included in the Transferred Interest
other than to deliver to
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the Transferor the collections and documents with respect to any such
indebtedness as described in Section 6.2 (b) hereof.
SECTION 6.3. Right After Designation of New Collection Agent. At any time
following the designation of a Collection Agent (other than the Transferor, the
Seller or any Affiliate of the Transferor or the Seller) pursuant to Section 6.1
hereof:
(i) The Agent may direct that payment of all amounts payable under any
Receivable be made directly to the Agent or its designee.
(ii) The Transferor shall, at the Agent's request and at the
Transferor's expense, give notice of the Agent's, the Transferor's and/or
the Bank Investors' ownership of Receivables to each Obligor and direct
that payments be made directly to the Agent or its designee.
(iii) The Transferor shall, at the Agent's request, (A) assemble all
of the Records, and shall make the same available to the Agent or its
designee at a place selected by the Agent or its designee, and (B)
segregate all cash, checks and other instruments received by it from time
to time constituting Collections of Receivables in a manner acceptable to
the Agent and shall, promptly upon receipt, remit all such cash, checks and
instruments, duly endorsed or with duly executed instruments of transfer,
to the Agent or its designee.
(iv) The Transferor hereby authorizes the Agent to take, to the extent
permitted by applicable law, any and all steps in the Transferor's or any
Originating Entity's name (which power, in the case of each Originating
Entity, the Transferor is authorized to grant pursuant to authority granted
to the Transferor under the Receivables Purchase Agreement) and on behalf
of the Transferor and such Originating Entity necessary or desirable, in
the determination of the Agent, to collect all amounts due under any and
all Receivables, including, without limitation, endorsing the Transferor's
or such Originating Entity's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Contracts.
Notwithstanding the foregoing clauses (i), (ii), (iii) and (iv), the Agent shall
not at any time direct, or cause the Transferor or any Originating Entity to
direct, Obligors of Receivables or Related Security payable under the Medicare
or Medicaid program to make payment of amounts due or to become due to the
Transferor or any Originating Entity in respect of such Receivables or Related
Security directly to the Concentration Account or to the Agent or its designee,
except for any such payment in respect of such Receivables or Related Security
or any assignment thereof that is established by, or made pursuant to, the order
of a court of competent jurisdiction.
SECTION 6.4. Collection Agent Default. The occurrence of any one or more
of the following events shall constitute a Collection Agent Default:
(a) (i) the Collection Agent or, to the extent that the Transferor,
the Seller or any Affiliate of the Transferor or the Seller is then acting
as Collection Agent, the Transferor, the Seller or such Affiliate, as
applicable, shall fail to observe or perform any term, covenant or
agreement to be observed or performed (A) under Section 5.3(d), 5.3(g) or
5.3(h) or Section 5.4, or (B) under Section 5.3 (other than subsection (d),
(g) or (h) thereof) and such failure shall continue for five (5) days, or
(ii) the Collection Agent or, to the extent that the Transferor, the Seller
or any Affiliate of the Transferor, or the Seller is then acting as
Collection Agent, the Transferor, the Seller or such Affiliate, as
applicable, shall fail to observe or perform any term, covenant or
agreement hereunder (other than as referred to in clause (i) or (iii) of
this Section 6.4(a)) or under any of the other Transaction Documents to
which such Person is a party or by which such Person is bound, and such
failure shall remain unremedied for ten (10) days, or (iii) the Collection
Agent or, the extent that the Transferor, the Seller or any Affiliate of
the Transferor, or the Seller is then acting as Collection Agent, the
Transferor, the Seller or such Affiliate, as applicable, shall fail to make
any payment or deposit required to be made by it hereunder when due or the
Collection Agent shall fail to observe or perform any term, covenant or
agreement on the Collection Agent's part to be performed under Section
2.8(b) hereof; or
(b) any representation, warranty, certification or statement made by
the Collection Agent or the Transferor, the Seller or any Affiliate of the
Transferor or the Seller (in the event that the Transferor, the
46
Seller or such Affiliate is then acting as the Collection Agent) in this
Agreement, the Receivables Purchase Agreement, the Transferring Affiliate
Letter, the BMA Transfer Agreement or in any of the other Transaction
Documents or in any certificate or report delivered by it pursuant to any
of the foregoing shall prove to have been incorrect in any material respect
when made or deemed made; or
(c) failure of the Collection Agent or any of its Subsidiaries, FMCAG,
or FMCH to pay when due any amounts due under any agreement under which any
Indebtedness greater that $50,000,000 is governed; or the default by the
Collection Agent or any of its Subsidiaries, FMCAG or FMCH in the
performance of any term, provision of condition contained in any agreement
under which any Indebtedness greater than $50,000,000 was created or is
governed, regardless of whether such event is an "event of default" or
"default" under any such agreement; or any Indebtedness of the Collection
Agent or any of its Subsidiaries, FMCAG or FMCH greater than $50,000,000
shall be declared to be due and payable or required to be prepaid (other
than by a regularly scheduled payment and other than in the case of an
instrument stated to be payable on demand) prior to the scheduled date of
maturity thereof; or
(d) any Event of Bankruptcy shall occur with respect to the Collection
Agent or any of its Subsidiaries; provided that in the case of any
immaterial Subsidiary of the Collection Agent, if an Event of Bankruptcy
shall have occurred by reason of any institution of an involuntary
proceeding against such Subsidiary, such Event of Bankruptcy shall not
constitute a Collection Agent Default unless such proceeding shall have
remained undismissed or unstayed for a period of 60 days; or
(e) there shall have occurred any material adverse change in the
operations of the Collection Agent since the end of the last fiscal year
ending prior to the date of its appointment as Collection Agent hereunder
or any other event shall have occurred which, in the commercially
reasonably judgment of the Agent, materially and adversely affects the
Collection Agent's ability to either collect the Receivables or to perform
under this Agreement.
SECTION 6.5. Responsibilities of the Transferor. Anything herein to the
contrary notwithstanding, the Transferor shall, and/or shall cause each
Originating Entity to, (i) perform all of each Originating Entity's obligations
under the Contracts related to the Receivables to the same extent as if
interests in such Receivables had not been sold hereunder and under the
Transferring Affiliate Letter, the BMA Transfer Agreement and/or the Receivables
Purchase Agreement, as applicable, and the exercise by the Agent, any
Administrative Agent and the Investors of their rights hereunder and under the
Transferring Affiliate Letter, the BMA Transfer Agreement and the Receivables
Purchase Agreement shall not relieve the Transferor or the Seller from such
obligations and (ii) pay when due any taxes, including without limitation, any
sales taxes payable in connection with the Receivables and their creation and
satisfaction. Neither the Agent nor any of the Investors or the Administrative
Agents shall have any obligation or liability with respect to any Receivable or
related Contracts, nor shall it be obligated to perform any of the obligations
of the Seller thereunder.
ARTICLE VII
TERMINATION EVENTS
SECTION 7.1. Termination Events. The occurrence of any one or more of the
following events shall constitute a Termination Event:
(a) the Transferor or the Collection Agent shall fail to make any
payment or deposit to be made by it hereunder or under the Receivables
Purchase Agreement when due hereunder or thereunder; or
(b) any representation, warranty, certification or statement made or
deemed made by the Transferor in this Agreement, by FMCAG or FMCH under the
Parent Agreement, or by the Transferor, FMCAG, FMCH or any other Parent
Group Member in any other Transaction Document to which it is a party or in
any other document certificate or other writing delivered pursuant hereto
or thereto, shall prove to have been incorrect in any material respect when
made or deemed made; or
47
(c) the Transferor or the Collection Agent shall default in the
performance of any payment or undertaking (other than those covered by
clause (a) above) to be performed or observed under:
(i) Section 5.1(a)(iv); provided that, in the case of any failure
to provide any such notice relating to a Potential Termination Event
that shall have ceased to exist prior to the date such notice was
required to have been given under Section 5.1(a)(iv), the failure to
give such notice shall not constitute a Termination Event unless a
senior officer of the Seller or the Transferor (including, in each case,
the Treasurer, any Assistant Treasurer, General Counsel or any assistant
or associate general counsel of such Person) shall have known of the
occurrence of such Potential Termination Event during such period; or
(ii) any of Sections 5.1(a)(v), 5.1 (a)(x), 5.1 (a)(ix), 5.1(b)(i),
5.1(f), 5.1(g), 5.1(h), 5.1(i), 5.1(k), 5.1(l), 5.2(a), 5.2(c), 5.2(d),
5.2(e), 5.2(f), 5.2(g), 5.2(h), 5.2(i) or 6.3; or
(iii) Section 5.1(b)(ii), and such default shall continue for 2
Business Days; or
(iv) any other provision hereof and such default in the case of
this clause (iv) shall continue for ten (10) days;
(d) (i) failure of the Transferor to pay when due any amounts due
under any agreement relating to Indebtedness to which it is a party; or the
default by the Transferor in the performance of any term, provision or
condition contained in any agreement relating to Indebtedness to which it
is a party regardless of whether such event is an "event of default" or
"default" under any such agreement; or any Indebtedness owing by the
Transferor 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; or (ii) failure of the Seller, FMCH, FMCAG or any
Transferring Affiliate to pay when due any amounts due under any agreement
to which any such Person is a party and under which any Indebtedness
greater than $50,000,000 is governed; or the default by the Seller, FMCH,
FMCAG or any Transferring Affiliate in the performance of any term,
provision or condition contained in any agreement to which any such Person
is a party and under which any Indebtedness owing by the Seller, FMCH,
FMCAG or any Transferring Affiliate greater than $50,000,000 was created or
is governed, regardless of whether such event is an "event of default" or
"default" under any such agreement; or any Indebtedness owing by the
Seller, FMCH, FMCAG or any Transferring Affiliate greater than $50,000,000
shall be declared to be due and payable or required to be prepaid (other
than by a regularly scheduled payment and other than in the case of an
instrument stated to be payable on demand) prior to the date of maturity
thereof; or
(e) any Event of Bankruptcy shall occur with respect to the
Transferor, any Originating Entity, FMCAG, FMCH or NMC; provided that, in
the case of any Event of Bankruptcy relating to any Transferring Affiliate,
such Event of Bankruptcy shall not constitute a Termination Event hereunder
if at such time the Percentage Factor does not exceed the Maximum
Percentage Factor after reducing the Net Receivables Balance by an amount
equal to the aggregate Outstanding Balance of all Receivables otherwise
included in the calculation of Net Receivables Balance which either (i)
have been originated by such Transferring Affiliate or (ii) are owing from
any Obligor that shall have been directed to remit payments thereon to a
Special Account that is a Special Account to which Obligors in respect of
the Transferring Affiliate that is the subject of such Event of Bankruptcy
shall have been directed to remit payments; or
(f) the Agent, on behalf of the Investors, shall, for any reason, fail
or cease to have a valid and perfected first priority ownership or security
interest in the Affected Assets free and clear of any Adverse Claims; or
the Transferor shall, for any reason, fail or cease to have all right,
title and interest in and to all Receivables, Related Security and
Collections, free and clear of any Adverse Claim, subject only to the
interests therein of the Agent, on behalf of the Investors; or
(g) a Collection Agent Default shall have occurred; or
(h) the Transferring Affiliate Letter, the BMA Transfer Agreement, the
Receivables Purchase Agreement or any other Transaction Document shall have
terminated; or any material provision thereof shall cease for any reason to
be valid and binding on any party thereto or any party shall so state in
writing; or any
48
party to any Transaction Document (other than the Agent, any Administrative
Agent or any Investor) shall fail to perform any material term, provision
or condition contained in any Transaction Document on its part to be
performed or a default shall otherwise occur thereunder; or
(i) any of FMCH, NMC, the Transferor or the Seller shall enter into
any transaction or merger whereby it is not the surviving entity; or
(j) there shall have occurred any material adverse change in the
operations of any of FMCH, NMC, the Transferor or the Seller since December
31, 2002 or any other Material Adverse Effect shall have occurred; or
(k) any Liquidity Provider or Credit Support Provider shall have given
notice that an event of default has occurred and is continuing under any of
its respective agreements with a Conduit Investor; or
(l) the Commercial Paper issued by a Conduit Investor or its Related
Issuer shall not be rated at least "A-2" by Standard & Poor's and at least
"P-2" by Moody's, unless any rating of such Commercial Paper shall be lower
than such level solely as a result of the correspondingly lower rating of
the Credit Support Provider for such Conduit Investor; or
(m) (i) the Percentage Factor exceeds the Maximum Percentage Factor
unless the Transferor reduces the Net Investment or increases the balance
of the Affected Assets on the next Business Day so as to reduce the
Percentage Factor to less than or equal to the Maximum Percentage Factor;
(ii) the Percentage Factor equals or exceeds 100% at any time; or (iii) the
portion of the Net Investment held by the Investors in any Related Group
plus, in the case where any portion of such Net Investment is held by a
Conduit Investor, the Interest Component of all outstanding Related
Commercial Paper with respect to such Conduit Investor, shall exceed the
applicable Related Group Limit at any time; or
(n) the Dilution Ratio for any month exceeds 12%; or
(o) the Loss-to-Liquidation Ratio for any month exceeds 8%; or
(p) the Default Ratio for any month exceeds 12%; or
(q) a default shall occur under the Parent Agreement; or the Parent
Agreement shall for any reason terminate; or any material provision thereof
shall cease to be valid and binding on any party thereto or any party
thereto shall so state in writing; or
(r) (i) the Seller shall cease to own, free and clear of any Adverse
Claim all of the outstanding shares of capital stock of the Transferor on a
fully diluted basis; or (ii) FMCH shall cease to own, directly or
indirectly, free and clear of any Adverse Claim, other than a pledge made
pursuant to the FMCAG Bank Revolver, all of the outstanding shares of
capital stock of any of the Originating Entities or the Collection Agent on
a fully diluted basis; or (iii) FMCAG shall cease to own, directly or
indirectly, free and clear of any Adverse Claim other than a pledge made
pursuant to the FMCAG Bank Revolver, all of the Voting Stock of FMCH other
than the preferred stock of FMCH outstanding as of the date hereof (which
preferred stock outstanding as of the date hereof shall not represent more
than 20% of the total Voting Stock of FMCH); or (iv) Fresenius AG, a
corporation organized under the laws of the Federal Republic of Germany,
shall cease to own, directly or indirectly, free and clear of any Adverse
Claim at least a majority of the Voting Stock of FMCAG; or
(s) both (i) FMCH's long-term public senior debt securities shall be
rated lower than B+ by Standard & Poor's or B1 by Moody's, or if neither
Standard & Poor's nor Moody's shall rate such securities, FMCH's long-term
senior debt shall have a deemed rating of lower than B+ as determined by
the Agent using its standard bond rating methodology, and (ii) FMCAG's
long-term public senior debt securities shall be rated lower than B+ by
Standard & Poor's or B1 by Moody's, or if neither Standard & Poor's nor
Moody's shall rate such securities, FMCAG's long-term senior debt shall
have a deemed rating of lower than B+ as determined by the Agent using its
standard bond rating methodology; or
(t) the Administrative Agents shall not have received, by no later
than November 21, 2003 (i) a final agreed upon procedures report from KPMG
substantially in the form attached as Exhibit T with results
49
satisfactory to each Administrative Agent and (ii) a final "no material
weakness" report from KPMG substantially in the form attached as Exhibit U
with results satisfactory to each Administrative Agent.
SECTION 7.2. Termination. (a) Upon the occurrence of any Termination
Event, the Agent may, and at the direction of any Administrative Agent or the
Majority Investors shall, by notice to the Transferor and the Collection Agent
declare the Termination Date to have occurred; provided, however, that in the
case of any event described in Section 7.1(e), 7.1(f), 7.1(m)(ii), 7.1(m)(iii)
or 7.1(r) above, the Termination Date shall be deemed to have occurred
automatically upon the occurrence of such event. Upon any such declaration or
automatic occurrence, the Agent shall have, in addition to all other rights and
remedies under this Agreement or otherwise, all other rights and remedies
provided under the UCC of the applicable jurisdiction and other applicable laws,
all of which rights shall be cumulative.
(b) At all times after the declaration or automatic occurrence of the
Termination Date pursuant to Section 7.2(a), the Base Rate plus 2.00% shall be
the Tranche Rate applicable to the Net Investment for all existing and future
Tranches.
Article VIII
INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 8.1. Indemnities by the Transferor. Without limiting any other
rights which the Agent, the Administrative Agents or the Investors may have
hereunder or under applicable law, the Transferor hereby agrees to indemnify the
Investors, the Agent, the Administrative Agents, the Collateral Agents, the
Liquidity Providers and the Credit Support Providers and their respective
successors and permitted assigns and their respective officers, directors and
employees (collectively, "Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, costs and expenses, including, without
limitation, reasonable attorneys' fees (which such attorneys may be employees of
a Liquidity Provider, a Credit Support Provider, the Agent, an Administrative
Agent or a Collateral Agent, as applicable) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts") awarded
against or incurred by any of them in any action or proceeding between the
Transferor or any Parent Group Member (including any Parent Group Member, in its
capacity as the Collection Agent) and any of the Indemnified Parties or between
any of the Indemnified Parties and any third party or otherwise arising out of
or as a result of this Agreement, the other Transaction Documents, the ownership
or maintenance, either directly or indirectly, by the Agent or any Investor of
the Transferred Interest or any of the other transactions contemplated hereby or
thereby, excluding, however, (i) Indemnified Amounts to the extent resulting
from gross negligence or willful misconduct on the part of an Indemnified Party
or (ii) recourse (except as otherwise specifically provided in this Agreement)
for uncollectible Receivables. Without limiting the generality of the foregoing,
the Transferor shall indemnify each Indemnified Party for Indemnified Amounts
relating to or resulting from:
(i) any representation or warranty made by any Parent Group Member
(including any Parent Group Member, in its capacity as the Collection
Agent) or any officers of any Parent Group Member (including any Parent
Group Member, in its capacity as the Collection Agent) under or in
connection with this Agreement, the Receivable Purchase Agreement, the
Parent Agreement, the Transferring Affiliate Letter, the BMA Transfer
Agreement, any of the other Transaction Documents, any Investor Report or
any other information or report delivered by any Parent Group Member
pursuant to or in connection with any Transaction Document, which shall
have been false or incorrect in any material respect when made or deemed
made;
(ii) the failure by any Parent Group Member (including any Parent
Group Member, in its capacity as the Collection Agent) to comply with any
applicable law, rule or regulation (including, without limitation, any
CHAMPUS/VA Regulation, any Medicaid Regulation or any Medicare Regulation),
including with respect to any Receivable or the related Contract, or the
nonconformity of any Receivable or the related Contract with any such
applicable law, rule or regulation;
(iii) the failure (x) to vest and maintain vested in the Agent, on
behalf of the Investors, an undivided first priority, perfected percentage
ownership interest (to the extent of the Transferred Interest) in the
Affected Assets free and clear of any Adverse Claim or (y) to create or
maintain a valid and perfected first
50
priority security interest in favor of the Agent, for the benefit of the
Investors, in the Affected Assets as contemplated pursuant to Section
10.11, free and clear of any Adverse Claim;
(iv) the failure to file, or any delay in filing, financing
statements, continuation statements, or other similar instruments or
documents under the UCC of any applicable jurisdiction or other applicable
laws with respect to any of the Affected Assets;
(v) any dispute, claim, offset or defense (other than discharge in
bankruptcy) of the Obligor to the payment of any Receivable (including,
without limitation, a defense based on such Receivable or the related
Contract not being the 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 merchandise or services related to such
Receivable or the furnishing or failure to furnish such merchandise or
services;
(vi) any failure of the Collection Agent to perform its duties or
obligations in accordance with the provisions hereof; or
(vii) any products liability claim or personal injury or property
damage suit or other similar or related claim or action of whatever sort
arising out of or in connection with merchandise or services which are the
subject of any Receivable;
(viii) the transfer of an ownership interest in any Receivable other
than an Eligible Receivable;
(ix) the failure by any Parent Group Member (individually or as
Collection Agent) to comply with any term, provision or covenant contained
in this Agreement or any of the other Transaction Documents to which it is
a party or to perform any of its respective duties under the Contracts;
(x) the Percentage Factor exceeding the Maximum Percentage Factor at
any time;
(xi) the failure of any Originating Entity to pay when due any taxes,
including without limitation, sales, excise or personal property taxes
payable in connection with any of the Receivables;
(xii) any repayment by any Indemnified Party of any amount previously
distributed in reduction on Net Investment which such Indemnified Party
believes in good faith is required to be made;
(xiii) the commingling by the Transferor, any Originating Entity or
the Collection Agent of Collections of Receivables at any time with other
funds;
(xiv) any investigation, litigation or proceeding instituted by or
against a Person other than such Indemnified Party related to this
Agreement, any of the other Transaction Documents, the use of proceeds of
Transfers by the Transferor or any Originating Entity, the ownership of
Transferred Interests, or any Receivable, Related Security or Contract;
(xv) the failure of any Special Account Bank, Designated Account Agent
or the Concentration Account Bank to remit any amounts held by it pursuant
to the instructions set forth in the applicable Special Account Letter or
Concentration Account Agreement or any instruction of the Collection Agent,
the Transferor, any Originating Entity or the Agent (to the extent such
Person is entitled to give such instructions in accordance with the terms
hereof and of any applicable Special Account Letter or Concentration
Account Agreement) whether by reason of the exercise of set-off rights or
otherwise;
(xvi) any inability to obtain any judgment in or utilize the court or
other adjudication system of, any state in which an Obligor may be located
as a result of the failure of the Transferor or the Seller to qualify to do
business or file any notice of business activity report or any similar
report;
(xvii) any failure of the Transferor to give reasonably equivalent
value to the Seller in consideration of the purchase by the Transferor from
the Seller of any Receivable, any failure of the Seller to give reasonably
equivalent value to any Transferring Affiliate in consideration of the
purchase by the Seller from such Transferring Affiliate of any Receivable,
or any attempt by any Person to void, rescind or set-aside any such
transfer under statutory provisions or common law or equitable action,
including, without limitation, any provision of the Bankruptcy Code;
51
(xviii) any action taken by the Transferor, any Originating Entity or
the Collection Agent (if a Parent Group Member or designee thereof) in the
enforcement or collection of any Receivable; provided, however, that if any
Conduit Investor enters into agreements for the purchase of interests in
receivables from one or more Other Transferors, such Conduit Investor shall
allocate such Indemnified Amounts which are in connection with a Credit
Support Agreement or the credit support furnished by the Credit Support
Provider to the Transferor and each Other Transferor; and provided,
further, that if such Indemnified Amounts are attributable to any Parent
Group Member and not attributable to any Other Transferor, the Transferor
shall be solely liable for such Indemnified Amounts or if such Indemnified
Amounts are attributable to Other Transferors and not attributable to any
Parent Group Member, such Other Transferors shall be solely liable for such
Indemnified Amounts;
(xix) any reduction or extinguishment of, or any failure by any
Obligor to pay (in whole or in part), any Receivable or any Related
Security with respect thereto as a result of or on account of any violation
of or prohibition under any law, rule or regulation now or hereafter in
effect from time to time, including without limitation and CHAMPUS/VA
Regulation, any Medicaid Regulation or any Medicare Regulation, or as a
result of or on account of the entering of any judicial or regulatory order
or agreement adversely affecting the Transferor or any Parent Group Member;
or
(xx) any failure by the Transferor or any Parent Group Member to
maintain all governmental and other authorization and approvals necessary
to render the services, or sell the merchandise, resulting in Receivables.
SECTION 8.2. Indemnity for Taxes, Reserves and Expenses. (a) If after the
date hereof, the adoption of any Law or bank regulatory guideline or any
amendment or change in the interpretation of any existing or future Law or bank
regulatory guideline by any Official Body charged with the administration,
interpretation or application thereof, or the compliance with any directive of
any Official Body (in the case of any bank regulatory guideline, whether or not
having the force of Law):
(i) shall subject any Indemnified Party to any tax, duty or other
charge (other than Excluded Taxes) with respect to this Agreement, the
other Transaction Documents, the ownership, maintenance or financing of the
Transferred Interest, the Receivables or payments of amounts due hereunder,
or shall change the basis of taxation of payments to any Indemnified Party
of amounts payable in respect of this Agreement, the other Transaction
Documents, the ownership, maintenance or financing of the Transferred
Interest, the Receivables or payments of amounts due hereunder or its
obligation to advance funds hereunder, under a Liquidity Provider Agreement
or the credit support furnished by a Credit Support Provider or otherwise
in respect of this Agreement, the other Transaction Documents, the
ownership, maintenance or financing of the Transferred Interest or the
Receivables (except for changes in the rate of general corporate,
franchise, net income or other income tax imposed on such Indemnified Party
by the jurisdiction in which such Indemnified Party's principal executive
office is located);
(ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System) against assets of, deposits with or for the account of, or credit
extended by, any Indemnified Party or shall impose on any Indemnified Party
or on the United States market for certificates of deposit or the London
interbank market any other condition affecting this Agreement, the other
Transaction Documents, the ownership, maintenance or financing of the
Transferred Interest, the Receivables or payments of amounts due hereunder
or its obligation to advance funds hereunder under a Liquidity Provider
Agreement or the credit support provided by a Credit Support Provider or
otherwise in respect of this Agreement, the other Transaction Documents,
the ownership, maintenance or financing of the Transferred Interest or the
Receivables; or
(iii) imposes upon any Indemnified Party any other expense (including,
without limitation, reasonable attorneys' fees and expenses, and expenses
of litigation or preparation therefor in contesting any of the foregoing)
with respect to this Agreement, the other Transaction Documents, the
ownership, maintenance or financing of the Transferred Interest, the
Receivables or payments of amounts due hereunder or its obligation to
advance funds hereunder under a Liquidity Provider Agreement or the credit
support furnished by a
52
Credit Support Provider or otherwise in respect to this Agreement, the
other Transaction Documents, the ownership, maintenance or financing of the
Transferred Interests or the Receivables, and the result of any of the
foregoing is to increase the cost to such Indemnified Party with respect to
this Agreement, the other Transaction Documents, the ownership, maintenance
or financing of the Transferred Interest, the Receivables, the obligations
hereunder, the funding of any purchases hereunder, a Liquidity Provider
Agreement or a Credit Support Agreement, by an amount deemed by such
Indemnified Party to be material,
then, within ten (10) days after demand by such Indemnified Party through any
Administrative Agent, the Transferor shall pay to such Administrative Agent for
the benefit of such Indemnified Party, such additional amount or amounts as will
compensate such Indemnified Party for such tax, increased cost or reduction.
(b) If any Indemnified Party shall have determined that after the date
hereof, the adoption of any applicable Law or bank regulatory guideline
regarding capital adequacy or accounting principles, or any change therein, or
any change in the interpretation or administration thereof by any Official Body,
or any request or directive regarding capital adequacy (in each case of any bank
regulatory guideline or accounting principles, whether or not having the force
of law) of any such Official Body, has or would have the effect of reducing the
rate of return on capital of such Indemnified Party (or its parent) as a
consequence of such Indemnified Party's obligations hereunder or with respect
hereto or otherwise as a consequence of the transactions contemplated hereby to
a level below that which such Indemnified Party (or its parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Indemnified Party to be material, then from time to time, within ten
(10) days after demand by such Indemnified Party through any Administrative
Agent, the Transferor shall pay to such Administrative Agent, for the benefit of
such Indemnified Party, such additional amount or amounts as will compensate
such Indemnified Party (or its parent) for such reduction. For avoidance of
doubt, any interpretation of Accounting Research Bulletin No. 51 by the
Financial Accounting Standards Board shall constitute an adoption, change,
request or directive subject to this Section 8.2(b).
(c) Each Administrative Agent will promptly notify the Transferor of any
event of which it has knowledge, occurring after the date hereof, which will
entitle an Indemnified Party to compensation pursuant to this Section 8.2. A
notice by an Administrative Agent or the applicable Indemnified Party claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Administrative Agent or any
applicable Indemnified Party may use any reasonable averaging and attributing
methods.
(d) Anything in this Section 8.2 to the contrary notwithstanding, if a
Conduit Investor enters into agreements for the acquisition of interests in
receivables from one or more Other Transferors, such Conduit Investor shall
allocate the liability for any amounts under this Section 8.2 which are in
connection with a Credit Support Agreement or the credit support provided by the
Credit Support Provider ("Section 8.2 Costs") to the Transferor and each Other
Transferor; provided, however, that if such Section 8.2 Costs are attributable
to any Parent Group Member and not attributable to any Other Transferor, the
Transferor shall be solely liable for such Section 8.2 Costs or if such Section
8.2 Costs are attributable to Other Transferors and not attributable to any
Parent Group Member, such Other Transferors shall be solely liable for such
Section 8.2 Costs.
(e) If any Indemnified Party in a Related Group makes a claim for payment
pursuant to this Section 8.2, then the Transferor may, at its option, remove
such Related Group and terminate the Commitments of the Investors in such
Related Group by paying to the Administrative Agent for such Related Group an
amount (the "Payoff Amount") equal to the sum of (i) the portion of the Net
Investment funded by the Investors in such Related Group, (ii) all Discount
accrued and to accrue thereon through the last day of the applicable Yield
Period(s) to which such Net Investment has been allocated and (iii) all other
Aggregate Unpaids owing to the members of such Related Group under the
Transaction Documents accrued through the date of such payment (including,
without limitation, amounts payable pursuant to this Section 8.2 accrued through
the date of payment). Any such removal and termination shall be made upon not
less than five (5) Business Days notice delivered by the Transferor to the
applicable Administrative Agent. The Payoff Amount for any Related Group shall
be calculated by the Administrative Agent and notified to the Transferor, which
calculation shall be conclusive and binding absent manifest error. Upon such
removal and termination, (x) the members of such
53
Related Group shall cease to be parties to this Agreement and the Commitments of
all Bank Investors in such Related Group shall be reduced to zero, (y) the
Facility Limit will be reduced by an amount equal to the Commitments (determined
immediately prior to such termination) of the Bank Investors, in such Related
Group and (z) the Maximum Net Investment shall be reduced to 98% of the Facility
Limit (determined after giving effect to the reduction thereof as described
above).
SECTION 8.3. Taxes. (a) All payments made hereunder by the Transferor or
the Collection Agent (each, a "Payor") to any Investor, any Administrative Agent
or the Agent (each, a "Recipient") shall be made free and clear of and without
deduction for any present or future income, excise, stamp or franchise taxes and
any other taxes, fees, duties, withholdings or other charges of any nature
whatsoever imposed by any taxing authority on any recipient (or any assignee of
such parties) (such non-excluded items being called "Taxes"), but excluding
franchise taxes and taxes imposed on or measured by the recipient's net income
or gross receipts ("Excluded Taxes"). In the event that any withholding or
deduction from any payment made by the Payor hereunder is required in respect of
any Taxes, then such Payor shall:
(i) pay directly to the relevant authority the full amount required to
be so withheld or deducted;
(ii) promptly forward to each Administrative Agent an official receipt
or other documentation satisfactory to the Administrative Agent evidencing
such payment to such authority; and
(iii) pay to the Recipient such additional amount or amounts as is
necessary to ensure that the net amount actually received by the Recipient
will equal the full amount such Recipient would have received had no such
withholding or deduction been required.
Moreover, if any Taxes are directly asserted against any Recipient with respect
to any payment received by such Recipient hereunder, the Recipient may pay such
Taxes and the Payor will promptly pay such additional amounts (including any
penalties, interest or expenses) as shall be necessary in order that the net
amount received by the Recipient after the payment of such Taxes (including any
Taxes on such additional amount) shall equal the amount such Recipient would
have received had such Taxes not been asserted. Notwithstanding the foregoing,
the Payor shall not be obligated to pay any such additional amounts pursuant to
clause (iii) above or pursuant to the immediately preceding sentence to a Bank
Investor that is not organized under the laws of the United States of America or
a state thereof if such Bank Investor shall have failed to comply with the
requirements of paragraph (b) of this Section 8.3 as of the time such Taxes are
due and payable.
If the Payor fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the Recipient the required receipts or other
required documentary evidence, the Payor shall indemnify the Recipient for any
incremental Taxes, interest, or penalties that may become payable by any
Recipient as a result of any such failure.
(b) Each Investor that is not incorporated under the laws of the United
States of America or a state thereof shall:
(X) (i) on or before the date of any payment by a Payor to such
Investor, deliver to such Payor, the Agent and the Administrative Agent for
its Related Group (A) two (2) duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor applicable form,
as the case may be, certifying that it is entitled to receive payments
hereunder without deduction or withholding of any United States federal
income taxes and (B) an Internal Revenue Service Form W-8 or W-9, or
successor applicable form, as the case may be, certifying that it is
entitled to an exemption from United States backup withholding tax;
(ii) deliver to each Payor, the Agent and the Administrative Agent for
its Related Group two (2) further copies of any such form or certification
on or before the date that any such form or certification expires or
becomes obsolete and after the occurrence of any event requiring a change
in the most recent form previously delivered by it to such Payor; and
(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by either Payor, the
Agent or the Administrative Agent for its Related Group; or
54
(Y) Each Investor or transferee that is not a "bank" under Section
881(c)(3)(A) of the Internal Revenue Code thereof shall:
(i) on or before the date it becomes a party hereto (or, in the case
of a participant, on or before the date such participant becomes a
participant hereunder), deliver to each Payor, the Agent and the
Administrative Agent for its Related Group (i) a statement under penalties
of perjury that such Investor or transferee (x) is not a "bank" under
Section 881(c)(3)(A) of the Internal Revenue Code, is not subject to
regulatory or other legal requirements as a bank in any jurisdiction, and
has not been treated as a bank for purposes of any tax, securities law or
other filing or submission made to any governmental authority, any
application made to a rating agency or qualification for any exemption from
tax, securities law or other legal requirements, (y) is not a 10-percent
shareholder within the meaning of Section 811(c)(3)(B) of the Internal
Revenue Code and (z) is not a controlled foreign corporation receiving
interest from a related person within the meaning of Section 881(c)(3)(C)
of the Internal Revenue Code and (ii) a properly completed and duly
executed Internal Revenue Service Form W-8 or applicable successor form;
(ii) deliver to each Payor, the Agent and its Administrative Agent two
further properly completed and duly executed copies of such Form W-8
expires or becomes obsolete or after the occurrence of any event requiring
a change in the most recent form previously delivered by it to such Payor
or upon the request of such Payor; and
(iii) obtain such extensions of time for filing and completing such
forms or certifications as may be reasonably requested by either Payor, the
Agent or its Administrative Agent;
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes an Investor hereunder which renders all such
forms inapplicable or which would prevent such Investor from duly completing and
delivering any such form with respect to it and such Investor so advises each
Payor, the Agent and its Administrative Agent. Each Person that shall become an
Investor or a participant of an Investor pursuant to subsection 10.6 shall, upon
the effectiveness of the related transfer, be required to provide all of the
forms, certifications and statements required pursuant to this subsection,
provided that in the case of a participant of an Investor the obligations of
such participant of an Investor pursuant to this subsection (b) shall be
determined as if the participant of an Investor were an Investor except that
such participant of an Investor shall furnish all such required forms,
certifications and statements to the Investor from which the related
participation shall have been purchased.
SECTION 8.4. Other Costs, Expenses and Related Matters. (a) The
Transferor agrees, upon receipt of a written invoice, to pay or cause to be
paid, and to save the Investors, the Administrative Agents and the Agent
harmless against liability for the payment of, all reasonable out-of-pocket
expenses (including, without limitation, attorneys', accountants' and other
third parties' fees and expenses, any filing fees and expenses incurred by
officers or employees of any of the Investors, the Administrative Agents and/or
the Agent) or intangible, documentary or recording taxes incurred by or on
behalf of any Investor, any Administrative Agent or the Agent (i) in connection
with the negotiation, execution, delivery and preparation of this Agreement, the
other Transaction Documents and any documents or instruments delivered pursuant
hereto and thereto and the transactions contemplated hereby or thereby
(including, without limitation, the perfection or protection of the Transferred
Interest) and (ii) from time to time (a) relating to any amendments, waivers or
consents under this Agreement and the other Transaction Documents, (b) arising
in connection with any Investor's, any Administrative Agent's, the Agent's or
any Collateral Agent's enforcement or preservation of rights (including, without
limitation, the perfection and protection of the Transferred Interest under this
Agreement), or (c) arising in connection with any audit, dispute, disagreement,
litigation or preparation for litigation involving this Agreement or any of the
other Transaction Documents (all of such amounts, collectively, "Transaction
Costs").
(b) With respect to any Tranche to which all or any portion of the Net
Investment held by any of the Investors in a Related Group has been allocated,
the Transferor shall pay to the Administrative Agent for such Related Group, for
the account of each applicable Investor, on demand any Early Collection Fee due
on account of the reduction of such Tranche on a day prior to the last day of
its Tranche Period (or, in the case of a CP Tranche Period, on or prior to the
maturity date for the Commercial Paper allocated to fund or maintain such Net
Investment).
55
SECTION 8.5. Reconveyance Under Certain Circumstances. The Transferor
agrees to accept the reconveyance from the Agent, on behalf of the applicable
Investors, of the Transferred Interest if the Agent or any Administrative Agent
notifies Transferor of a material breach of any representation or warranty made
or deemed made pursuant to Article III of this Agreement and Transferor shall
fail to cure such breach within 15 days (or, in the case of the representations
and warranties in Sections 3.1(d) and 3.1(j), 3 days) of such notice. The
reconveyance price shall be paid by the Transferor to the Agent, for the account
of the applicable Investors, as applicable, in immediately available funds on
such 15th day (or 3rd day, if applicable) in an amount equal to the Aggregate
Unpaids; provided that if such 15th day (or 3rd day) is not a Business Day, such
reconveyance and the related payment shall be made on the next following
Business Day.
ARTICLE IX
THE AGENT; BANK COMMITMENT; THE ADMINISTRATIVE AGENTS
SECTION 9.1. Authorization and Action. (a) Each Investor hereby appoints
and authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the other Transaction Documents as
are delegated to the Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto. In furtherance, and without
limiting the generality, of the foregoing, each Investor hereby appoints the
Agent as its agent to execute and deliver all further instruments and documents,
and take all further action that the Agent may deem necessary or appropriate or
that any Investor may reasonably request in order to perfect, protect or more
fully evidence the interests transferred or to be transferred from time to time
by the Transferor hereunder, or to enable any of them to exercise or enforce any
of their respective rights hereunder, including, without limitation, the
execution by the Agent as secured party/assignee of such financing or
continuation statements, or amendments thereto or assignments thereof, relative
to all or any of the Receivables now existing or hereafter arising, and such
other instruments or notices, as may be necessary or appropriate for the
purposes stated hereinabove. The Majority Investors may direct the Agent to take
any such incidental action hereunder. With respect to other actions which are
incidental to the actions specifically delegated to the Agent hereunder, the
Agent shall not be required to take any such incidental action hereunder, but
shall be required to act or to refrain from acting (and shall be fully protected
in acting or refraining from acting) upon the direction of the Majority
Investors; provided, however, the Agent shall not be required to take any action
hereunder if the taking of such action, in the reasonable determination of the
Agent, shall be in violation of any applicable law, rule or regulation or
contrary to any provision of this Agreement or shall expose the Agent to
liability hereunder or otherwise. Upon the occurrence and during the continuance
of any Termination Event or Potential Termination Event, the Agent shall take no
action hereunder (other than ministerial actions or such actions as are
specifically provided for herein) without the prior consent of the Majority
Investors (which consent shall not be unreasonably withheld or delayed). The
Agent shall not, without the prior written consent of all Bank Investors, agree
to (i) amend, modify or waive any provision of this Agreement in any way which
would (A) reduce or impair Collections or the payment of Discount or fees
payable hereunder to the Investors or delay the scheduled dates for payment of
such amounts, (B) increase the Servicing Fee (other than as permitted pursuant
to Section 6.2(b)), (C) modify any provisions of this Agreement or the
Receivables Purchase Agreement or the Parent Agreement relating to the timing of
payments required to be made by the Transferor, any Originating Entity, FMCAG or
FMCH or the application of the proceeds of such payments, (D) permit the
appointment of any Person (other than the Agent) as successor Collection Agent,
(E) release any property from the lien provided by this Agreement (other than as
expressly contemplated herein) or (F) extend or permit the extension of the
Commitment Termination Date without the consent of each Bank Investor. The Agent
shall not, without the prior written consent of each Administrative Agent, agree
to amend, modify or waive any provision of this Agreement, the Transferring
Affiliate Letter, the BMA Transfer Agreement, the Receivables Purchase Agreement
or the Parent Agreement. The Agent shall not agree to any amendment of this
Agreement which increases the dollar amount of any Investor's Commitment without
the prior consent of such Investor. In addition, the Agent shall not agree to
any amendment of this Agreement not specifically described in the two preceding
sentences without the consent of the Majority Investors (which consent shall not
be unreasonably withheld or delayed). In the event the Agent requests any
Investor's consent pursuant to the foregoing provisions and the Agent does not
receive a consent (either positive or negative) from such Investor within 10
Business Days of such Investor's receipt of such
56
request, then such Investor (and its percentage interest hereunder) shall be
disregarded in determining whether the Agent shall have obtained sufficient
consent hereunder.
(b) The Agent shall exercise such rights and powers vested in it by this
Agreement and the other Transaction Documents, and use the same degree of care
and skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
SECTION 9.2. Agent's Reliance, Etc. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them as Agent under or in connection with this
Agreement or any of the other Transaction Documents, except for its or their own
gross negligence or willful misconduct. Without limiting the foregoing, the
Agent: (i) may consult with legal counsel (including counsel for any Parent
Group Member), independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts; (ii) makes no warranty or representation to any Investor and shall not
be responsible to any Investor for any statements, warranties or representations
made in or in connection with this Agreement; (iii) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of this Agreement or any of the other Transaction
Documents on the part of any Parent Group Member or the Collection Agent or to
inspect the property (including the books and records) of any Parent Group
Member or the Collection Agent; (iv) shall not be responsible to any Investor
for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any of the other Transaction Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(v) shall incur no liability under or in respect of this Agreement or any of the
other Transaction Documents by acting upon any notice (including notice by
telephone), consent, certificate or other instrument or writing (which may be by
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 9.3. Credit Decision. Each Investor acknowledges that it has,
independently and without reliance upon the Agent, any Administrative Agent, any
Affiliate of an Administrative Agent or any other Investor and based upon such
documents and information as it has deemed appropriate, made its own evaluation
and decision to enter into this Agreement and the other Transaction Documents to
which it is a party and, if it so determines, to accept the transfer to the
Agent on its behalf of any undivided ownership interest in the Affected Assets
hereunder. Each Investor also acknowledges that it will, independently and
without reliance upon the Agent, any of the Agent's Affiliates or any other
Investor and based on such documents and information as it shall deem
appropriate at the time, continue to make its own decisions in taking or not
taking action under this Agreement and the other Transaction Documents to which
it is a party.
SECTION 9.4. Indemnification of the Agent. The Bank Investors agree to
indemnify the Agent (to the extent not reimbursed by the Transferor), ratably in
accordance with their respective Commitments, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent in any way relating to or
arising out of this Agreement or any action taken or omitted by the Agent, any
of the other Transaction Documents hereunder or thereunder, provided that the
Bank Investors shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, the Bank Investors agree to
reimburse the Agent, ratably in accordance with their respective Commitments,
promptly upon demand for any out-of-pocket expenses (including counsel fees)
incurred by the Agent in connection with the administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement and the other Transaction Documents, to the extent that such
expenses are incurred in the interests of or otherwise in respect of the Bank
Investors hereunder and/or thereunder and to the extent that the Agent is not
reimbursed for such expenses by the Transferor.
SECTION 9.5. Successor Agent. The Agent may resign at any time by giving
written notice thereof to each Investor and the Transferor and may be removed at
any time with cause by the Majority Investors. Upon any such resignation or
removal, the Majority Investors shall appoint a successor Agent. Each Investor
agrees that it shall not unreasonably withhold or delay its approval of the
appointment of a successor Agent. If no such successor
57
Agent shall have been so appointed, and shall have accepted such appointment,
within 30 days after the retiring Agent's giving of notice of resignation or the
Majority Investors' removal of the retiring Agent, then the retiring Agent may,
on behalf of the Investors, appoint a successor Agent which successor Agent
shall be either (i) a commercial bank organized under the laws of the United
States or of any state thereof and have a combined capital and surplus of at
least $50,000,000 or (ii) an Affiliate of such a bank. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Agent's resignation or removal hereunder as Agent, the provisions of
this Article IX shall continue to inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
SECTION 9.6. Payments by the Agent. All amounts received by the Agent on
behalf of the Investors shall be paid by the Agent to the Investors (at their
respective accounts specified in their respective Assignment and Assumption
Agreements) on the Business Day received by the Agent, unless such amounts are
received after 12:00 noon on such Business Day, in which case the Agent shall
use its reasonable efforts to pay such amounts to the Investors on such Business
Day, but, in any event, shall pay such amounts to the Investors not later than
the following Business Day. All amounts received by the Agent hereunder on
behalf of the Investors shall be allocated among the Related Groups in
accordance with Sections 2.5 and/or 2.6, as applicable. For purposes of the
foregoing, the Agent shall be deemed to be a member of the Related Group that
includes Paradigm.
SECTION 9.7. Bank Commitment; Assignment to Bank Investors.
(a) Bank Commitment. At any time on or prior to the Commitment Termination
Date, in the event that a Conduit Investor does not effect an Incremental
Transfer as requested under Section 2.2(a), then at any time, the Transferor
shall have the right to require such Conduit Investor to assign its interest in
the Net Investment in whole to the Bank Investors in its Related Group pursuant
to this Section 9.7. In addition, at any time on or prior to the Commitment
Termination Date, (i) upon the occurrence of a Termination Event that results in
the Termination Date or (ii) if a Conduit Investor elects to give notice to the
Transferor of a Reinvestment Termination Date, the Transferor hereby requests
and directs that such Conduit Investor assign its interest in the Net Investment
in whole to the Bank Investors in its Related Group pursuant to this Section 9.7
and the Transferor hereby agrees to pay the amounts described in Section 9.7(d)
below. Provided that the Net Asset Test is satisfied, upon any such election by
a Conduit Investor or any such request by the Transferor to such Conduit
Investor, such Conduit Investor shall make such assignment and the Bank
Investors in its Related Group shall accept such assignment and shall assume all
of such Conduit Investor's obligations hereunder. In connection with any
assignment from a Conduit Investor to the Bank Investors in its Related Group
pursuant to this Section 9.7, each Bank Investor shall, on the date of such
assignment, pay to such Conduit Investor an amount equal to its Assignment
Amount. Upon any assignment by a Conduit Investor to the Bank Investors in its
Related Group as contemplated hereunder, such Conduit Investor shall cease to
make any additional Incremental Transfers hereunder.
(b) Assignment. No Bank Investor may assign all or a portion of its
interests in the Net Investment, the Receivables, and Collections, Related
Security and Proceeds with respect thereto and its rights and obligations
hereunder to any Person unless approved in writing by the Administrative Agent
for its Related Group, on behalf of the related Conduit Investor. Without
limiting the generality of the foregoing, it is understood for the avoidance of
doubt that an Administrative Agent may condition any approval on its receipt of
written confirmation from each applicable Rating Agency that such assignment
will not result in the reduction or withdrawal of the then current rating of the
Commercial Paper issued by the related Conduit Investor. In the case of an
assignment by a Conduit Investor to the Bank Investors or by a Bank Investor to
another Person, the assignor shall deliver to the assignee(s) an Assignment and
Assumption Agreement in substantially the form of Exhibit G attached hereto,
duly executed, assigning to the assignee a pro rata interest in the Net
Investment, the Receivables, and Collections, Related Security and Proceeds with
respect thereto and the assignor's rights and obligations hereunder and the
assignor shall promptly execute and deliver all further instruments and
documents, and take all further action, that the assignee may reasonably
request, in order to protect, or more fully evidence the assignee's right, title
and interest in and to such interest and to enable the Agent, on behalf of such
assignee, to exercise or enforce any rights hereunder and under the other
Transaction Documents to which such assignor is or,
58
immediately prior to such assignment, was a party. Upon any such assignment, (i)
the assignee shall have all of the rights and obligations of the assignor
hereunder and under the other Transaction Documents to which such assignor is
or, immediately prior to such assignment, was a party with respect to such
interest for all purposes, it being understood that the Bank Investors, as
assignees, shall (x) be obligated to fund Incremental Transfers under Section
2.2(a) in accordance with the terms thereof, notwithstanding that related
Conduit Investor was not so obligated and (y) not have the right to elect the
commencement of the amortization of the Net Investment pursuant to the
definition of "Reinvestment Termination Date", notwithstanding that the related
Conduit Investor had such right) and (ii) the assignor shall relinquish its
rights with respect to such interest for all purposes of this Agreement and
under the other Transaction Documents to which such assignor is or, immediately
prior to such assignment, was a party. No such assignment shall be effective
unless a fully executed copy of the related Assignment and Assumption Agreement
shall be delivered to the Agent, the Administrative Agent for the applicable
Related Group and the Transferor. All costs and expenses of the Agent, the
applicable Administrative Agent and the assignor and assignee incurred in
connection with any assignment hereunder shall be borne by the Transferor and
not by the assignor or any such assignee. No Bank Investor shall assign any
portion of its Commitment hereunder without also simultaneously assigning an
equal portion of its interest in the applicable Liquidity Provider Agreement.
(c) Effects of Assignment. By executing and delivering an Assignment and
Assumption Agreement, the assignor and assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Assumption Agreement, the assignor makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement, the other Transaction Documents or any other instrument or document
furnished pursuant hereto or thereto or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, the other
Transaction Documents or any such other instrument or document; (ii) the
assignor makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Transferor, any Parent Group Member or
the Collection Agent or the performance or observance by the Transferor, any
Parent Group Member or the Collection Agent of any of their respective
obligations under this Agreement, the Receivables Purchase Agreement, the
Transferring Affiliate Letter, the BMA Transfer Agreement, the Parent Agreement,
the other Transaction Documents or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, the Receivables Purchase Agreement, the Transferring Affiliate
Letter, the BMA Transfer Agreement, the Parent Agreement, and such other
instruments, documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Assumption
Agreement and to purchase such interest; (iv) such assignee will, independently
and without reliance upon the Agent, any Administrative Agent, or any of their
respective Affiliates, or the assignor and based on such agreements, 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 this Agreement and the
other Transaction Documents; (v) such assignee appoints and authorizes the Agent
to take such action as agent on its behalf and to exercise such powers under
this Agreement, the other Transaction Documents and any other instrument or
document furnished pursuant hereto or thereto as are delegated to the Agent by
the terms hereof or thereof, together with such powers as are reasonably
incidental thereto and to enforce its respective rights and interests in and
under this Agreement, the other Transaction Documents, the Receivables, the
Contracts and the Related Security; (vi) such assignee appoints and authorizes
the applicable Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement, the other Transaction
Documents and any other instrument or document furnished pursuant hereto or
thereto as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such powers as are reasonably incidental thereto and to
enforce its respective rights and interests in and under this Agreement, the
other Transaction Documents, the Receivables, the Contracts and the Related
Security, (vii) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement and the
other Transaction Documents are required to be performed by it as the assignee
of the assignor; and (viii) such assignee agrees that it will not institute
against any Conduit Investor any proceeding of the type referred to in Section
10.9 prior to the date which is one year and one day after the payment in full
of all Commercial Paper issued by such Conduit Investor.
59
(d) Transferor's Obligation to Pay Certain Amounts; Additional Assignment
Amount. The Transferor shall pay to the Administrative Agent for a Conduit
Investor or, in the case of GMFC, to such Conduit Investor, for the account of
such Conduit Investor, in connection with any assignment by such Conduit
Investor to the Bank Investors in its Related Group pursuant to this Section
9.7, an aggregate amount equal to all Discount to accrue through the end of each
outstanding Tranche Period plus all other Aggregate Unpaids (other than the Net
Investment) owing to such Conduit Investor. To the extent that such Discount
relates to interest or discount on Related Commercial Paper, if the Transferor
fails to make payment of such amounts at or prior to the time of assignment by
such Conduit Investor to the Bank Investors in its Related Group, such amount
shall be paid by such Bank Investors (in accordance with their respective Pro
Rata Shares) to such Conduit Investor as additional consideration for the
interests assigned to such Bank Investors and the amount of the "Net Investment"
hereunder held by such Bank Investors shall be increased by an amount equal to
the additional amount so paid by such Bank Investors.
(e) Administration of Agreement After Assignment. After any assignment by
a Conduit Investor to the Bank Investors in its Related Group pursuant to this
Section 9.7 (and the payment of all amounts owing to such Conduit Investor in
connection therewith), all rights of the related Collateral Agent set forth
herein shall be deemed to be afforded to the Administrative Agent for such
Related Group on behalf of such Bank Investors instead of such Collateral Agent.
(f) Payments. After any assignment by a Conduit Investor to the Bank
Investors in its Related Group pursuant to this Section 9.7, all payments to be
made hereunder by the Transferor or the Collection Agent to such Conduit
Investor shall be made to the applicable Administrative Agent's account as such
account shall have been notified to the Transferor and the Collection Agent.
(g) Downgrade of Bank Investor. If (at any time prior to any assignment
by a Conduit Investor to the Bank Investors in its Related Group as contemplated
pursuant to this Section 9.7) the short term debt rating of any Bank Investor in
such Related Group shall be "A-2" or "P-2" from Standard & Poor's or Moody's,
respectively, with negative credit implications, such Bank Investor, upon
request of the applicable Administrative Agent, shall, within 30 days of such
request, assign its rights and obligations hereunder to another financial
institution (which institution's short term debt shall be rated at least "A-2"
and "P-2" from Standard & Poor's and Moody's, respectively, and which shall not
be so rated with negative credit implications). If the short term debt rating of
a Bank Investor in a Related Group shall be "A-3" or "P-3", or lower, from
Standard & Poor's or Moody's, respectively (or such rating shall have been
withdrawn by Standard & Poor's or Moody's), such Bank Investor, upon request of
the applicable Administrative Agent, shall, within five (5) Business Days of
such request, assign its rights and obligations hereunder to another financial
institution (which institution's short term debt shall be rated at least "A-2"
and "P-2" from Standard & Poor's and Moody's, respectively, and which shall not
be so rated with negative credit implications). In either such case, if any such
Bank Investor in a Related Group shall not have assigned its rights and
obligations under this Agreement within the applicable time period described
above, the related Conduit Investor shall have the right to require such Bank
Investor to accept the assignment of such Bank Investor's Pro Rata Share of the
Net Investment; such assignment shall occur in accordance with the applicable
provisions of this Section 9.7. Such Bank Investor shall be obligated to pay to
such Conduit Investor, in connection with such assignment, in addition to the
Pro Rata Share of the Net Investment, an amount equal to the Interest Component
of the outstanding Commercial Paper issued to fund the portion of the Net
Investment being assigned to such Bank Investor, as reasonably determined by the
applicable Administrative Agent. Notwithstanding anything contained herein to
the contrary, upon any such assignment to a downgraded Bank Investor as
contemplated pursuant to the immediately preceding sentence, the aggregate
available amount of the applicable Related Group Limit, solely as it relates to
new Incremental Transfers to such Conduit Investor, shall be reduced by the
amount of unused Commitment of such downgraded Bank Investor; it being
understood and agreed, that nothing in this sentence or the two preceding
sentences shall affect or diminish in any way any such downgraded Bank
Investor's Commitment to the Transferor or such downgraded Bank Investor's other
obligations and liabilities hereunder and under the other Transaction Documents.
SECTION 9.8. Appointment of Administrative Agents. (a) Each Investor in a
Related Group hereby appoints and authorizes the Administrative Agent for its
Related Group to take such action as agent on its behalf and to exercise such
powers under this Agreement and the other Transaction Documents as are delegated
to such
60
Administrative Agent by the terms hereof and thereof, together with such powers
as are reasonably incidental thereto. In furtherance, and without limiting the
generality, of the foregoing, each Investor in a Related Group hereby appoints
the Administrative Agent for its Related Group as its agent to execute and
deliver all further instruments and documents, and take all further action that
such Administrative Agent may deem necessary or appropriate or that any Investor
may reasonably request to enable any of them to exercise or enforce any of their
respective rights hereunder. Bank Investors representing at least 66 and 2/3% of
the aggregate Commitments of all Bank Investors in a Related Group (the "Group
Majority Investors" for such Related Group) may direct the Administrative Agent
for such Related Group to take any such incidental action hereunder. With
respect to other actions which are incidental to the actions specifically
delegated to an Administrative Agent hereunder, such Administrative Agent shall
not be required to take any such incidental action hereunder, but shall be
required to act or to refrain from acting (and shall be fully protected in
acting or refraining from acting) upon the direction of the Group Majority
Investors; provided, however, no Administrative Agent shall be required to take
any action hereunder if the taking of such action, in the reasonable
determination of such Administrative Agent, shall be in violation of any
applicable law, rule or regulation or contrary to any provision of this
Agreement or shall expose such Administrative Agent to liability hereunder or
otherwise. Upon the occurrence and during the continuance of any Termination
Event or Potential Termination Event, the Administrative Agent for a Related
Group shall take no action hereunder (other than ministerial actions or such
actions as are specifically provided for herein) without the prior consent of
the Group Majority Investors (which consent shall not be unreasonably withheld
or delayed). The Administrative Agent for a Related Group shall not, without the
prior written consent of all Bank Investor, in such Related Group, agree to (i)
amend, modify or waive any provision of this Agreement in any way which would
(A) reduce or impair Collections or the payment of Discount or fees payable
hereunder to the Bank Investors, in such Related Group or delay the scheduled
dates for payment of such amounts, (B) increase the Servicing Fee (other than as
permitted pursuant to Section 6.2(b)), (C) modify any provisions of this
Agreement or the Receivables Purchase Agreement or the Parent Agreement relating
to the timing of payments required to be made by the Transferor, any Originating
Entity, FMCAG or FMCH or the application of the proceeds of such payments, (D)
permit the appointment of any Person (other than the Agent) as successor
Collection Agent, (E) release any property from the lien provided by this
Agreement (other than as expressly contemplated herein) or (F) extend or permit
the extension of the Commitment Termination Date without the consent of each
Bank Investor, in such Related Group. The Administrative Agent for a Related
Group shall not agree to any amendment of this Agreement which increases the
dollar amount of the Commitment of a Bank Investor in such Related Group without
the prior consent of such Bank Investor. In addition, no Administrative Agent
shall agree to any amendment of this Agreement not specifically described in the
two preceding sentences without the consent of the related Group Majority
Investors (which consent shall not be unreasonably withheld or delayed). In the
event an Administrative Agent requests any Investor's consent pursuant to the
foregoing provisions and such Administrative Agent does not receive a consent
(either positive or negative) from such Investor within 10 Business Days of such
Investor's receipt of such request, then such Investor (and its percentage
interest hereunder) shall be disregarded in determining whether such
Administrative Agent shall have obtained sufficient consent hereunder.
(b) Each Administrative Agent shall exercise such rights and powers vested
in it by this Agreement and the other Transaction Documents, and use the same
degree of care and skill in their exercise, as a prudent person would exercise
or use under the circumstances in the conduct of such person's own affairs.
SECTION 9.9. Administrative Agent's Reliance, Etc. Neither any
Administrative Agent nor any directors, officers, agents or employees of an
Administrative Agent shall be liable for any action taken or omitted to be taken
by it or them as Administrative Agent under or in connection with this Agreement
or any of the other Transaction Documents, except for its or their own gross
negligence or willful misconduct. Without limiting the foregoing, each
Administrative Agent: (i) may consult with legal counsel (including counsel for
any Parent Group Member), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (ii) makes no warranty or representation to any Investor
and shall not be responsible to any Investor for any statements, warranties or
representations made in or in connection with this Agreement; (iii) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement or any of the other
Transaction Documents on the part of any Parent Group Member
61
or the Collection Agent or to inspect the property (including the books and
records) of any Parent Group Member or the Collection Agent; (iv) shall not be
responsible to any Investor for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, any of the
other Transaction Documents or any other instrument or document furnished
pursuant hereto or thereto; and (v) shall incur no liability under or in respect
of this Agreement or any of the other Transaction Documents by acting upon any
notice (including notice by telephone), consent, certificate or other instrument
or writing (which may be by telex) believed by it to be genuine and signed or
sent by the proper party or parties.
SECTION 9.10. Indemnification of the Administrative Agents. The Bank
Investors, in each Related Group agree to indemnify the Administrative Agent for
such Related Group (to the extent not reimbursed by the Transferor), ratably in
accordance with their Pro Rata Shares, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against such Administrative Agent in any way
relating to or arising out of this Agreement or any action taken or omitted by
such Administrative Agent, any of the other Transaction Documents hereunder or
thereunder, provided that the Bank Investors, in a Related Group shall not be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the applicable Administrative Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, the Bank Investors, in each
Related Group agree to reimburse the Administrative Agent for such Related
Group, ratably in accordance with their Pro Rata Shares, promptly upon demand
for any out-of-pocket expenses (including counsel fees) incurred by such
Administrative Agent in connection with the administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement and the other Transaction Documents, to the extent that such
expenses are incurred in the interests of or otherwise in respect of such Bank
Investors, hereunder and/or thereunder and to the extent that such
Administrative Agent is not reimbursed for such expenses by the Transferor.
SECTION 9.11. Successor Administrative Agents. Any Administrative Agent
may resign at any time by giving written notice thereof to the Agent, each
Investor in its Related Group and the Transferor and may be removed at any time
with cause by the applicable Group Majority Investors. Upon any such resignation
or removal, the Group Majority Investors for such Related Group shall appoint a
successor Administrative Agent. Each Investor agrees that it shall not
unreasonably withhold or delay its approval of the appointment of a successor
Administrative Agent. If no such successor Administrative Agent shall have been
so appointed for such Related Group, and shall have accepted such appointment,
within 30 days after the retiring Administrative Agent's giving of notice of
resignation or the Group Majority Investors' removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of
the Investors in such Related Group, appoint a successor Administrative Agent
for such Related Group which successor Administrative Agent shall be either (i)
a commercial bank having a combined capital and surplus of at least $50,000,000
or (ii) an Affiliate of such a bank. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties
and obligations under this Agreement. After any retiring Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Article IX shall continue to inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement.
SECTION 9.12. Payments by the Administrative Agents. Unless specifically
allocated to an Investor pursuant to the terms of this Agreement, all amounts
received by an Administrative Agent on behalf of the Investors in its Related
Group shall be paid by such Administrative Agent to the Investors in its Related
Group (at their respective accounts specified in their respective Assignment and
Assumption Agreements) in accordance with their respective related pro rata
interests in the Net Investment on the Business Day received by such
Administrative Agent, unless such amounts are received after 12:00 noon on such
Business Day, in which case such Administrative Agent shall use its reasonable
efforts to pay such amounts to the Investors in its Related Group on such
Business Day, but, in any event, shall pay such amounts to such Investors in
accordance with their respective related pro rata interests in the Net
Investment not later than the following Business Day.
62
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Term of Agreement. This Agreement shall terminate on the
date following the Termination Date upon which the Net Investment has been
reduced to zero, all accrued Discount and Servicing Fees have been paid in full
and all other Aggregate Unpaids have been paid in full, in each case, in cash;
provided, however, that (i) the rights and remedies of the Agent, the Investors
and the Administrative Agents with respect to any representation and warranty
made or deemed to be made by the Transferor pursuant to this Agreement, (ii) the
indemnification and payment provisions of Article VIII, and (iii) the agreement
set forth in Section 10.9 hereof, shall be continuing and shall survive any
termination of this Agreement.
SECTION 10.2. Waivers; Amendments. No failure or delay on the part of the
Agent, any Investor or any Administrative Agent 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 provision of this Agreement may be
amended or waived if, but only if, in the case of any amendment, such amendment
is in writing and is signed by the Transferor, the Agent, each Administrative
Agent and the Majority Investors and in the case of any waiver, such waiver is
granted in writing by each Administrative Agent. Without limiting the generality
of the foregoing, it is understood for the avoidance of doubt that an
Administrative Agent may condition its consent to any amendment or waiver on its
receipt of written confirmation from S&P and Moody's that such amendment or
waiver will not result in the reduction or withdrawal of the then current rating
of the Commercial Paper issued by its related Conduit Investor.
SECTION 10.3. Notices. Except as provided below, all communications and
notices provided for hereunder shall be in writing (including telecopy or
electronic facsimile transmission or similar writing) and shall be given to the
other party at its address or telecopy number set forth below or at such other
address or telecopy number as such party may hereafter specify for the purposes
of notice to such party. Each such notice or other communication shall be
effective (i) if given by telecopy when such telecopy is transmitted to the
telecopy number specified in this Section 10.3 and confirmation is received,
(ii) if given by mail 3 Business Days following such posting, postage prepaid,
U.S. certified or registered, (iii) if given by overnight courier, one (1)
Business Day after deposit thereof with a national overnight courier service, or
(iv) if given by any other means, when received at the address specified in this
Section 10.3. However, anything in this Section to the contrary notwithstanding,
the Transferor hereby authorizes each Investor, each Administrative Agent and
the Agent to effect Transfers, Tranche Period and Tranche Rate selections based
on telephonic notices made by any Person which such Investor, such
Administrative Agent or the Agent, as applicable, in good faith believes to be
acting on behalf of the Transferor. The Transferor agrees to deliver promptly to
each such Investor or Administrative Agent or the Agent, as applicable, a
written confirmation of each telephonic notice directed to such Person signed by
an authorized officer of Transferor. However, the absence of such confirmation
shall not affect the validity of such notice. If the written confirmation
differs in any material respect from the action taken by the Agent or the
applicable Investor or Administrative Agent, the records of such Investor or
Administrative Agent or the Agent, as applicable shall govern absent manifest
error.
If to the Transferor:
(NMC Funding Corporation)
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
Payment Information:
Chase Manhattan Bank, N.A.
ABA ▇▇▇-▇▇▇-▇▇▇
Account ▇▇▇-▇-▇▇▇▇▇
63
If to the Collection Agent:
National Medical Care, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
If to the Agent:
WestLB AG, New York Branch
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to Paradigm:
▇/▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Administrative Agent for Paradigm:
▇/▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to GMFC:
Giro Multi-Funding Corporation
c/o Global Securitization Services
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Tel: 631/▇▇▇-▇▇▇▇
Telecopy: 212/302-8767
If to BayernLB:
Bayerische Landesbank, New York Branch
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Asset Securitization
Tel: 212/▇▇▇-▇▇▇▇
Telecopy: 212/230-9020
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If to Asset One:
Asset One Securitization, LLC
c/o AMACAR Group, LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Tel: 704/▇▇▇-▇▇▇▇
Fax: 704/▇▇▇-▇▇▇▇
If to the Administrative Agent for Asset One:
Societe Generale
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chin-Eav Eap
Tel: 212/▇▇▇-▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
If to Liberty Street:
c/o Global Securitization Services, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Administrative Agent for Liberty Street:
The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Tel: 212/▇▇▇-▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
with a copy to:
The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel: 212/▇▇▇-▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
If to the Bank Investors, at their respective addresses set forth on
Schedule I or in the Assignment and Assumption Agreement pursuant to which it
became a party hereto.
SECTION 10.4. Governing Law; Submission to Jurisdiction; Integration.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. THE TRANSFEROR HEREBY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE CITY OF NEW
YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. Each of the Transferor and
the Collection Agent hereby irrevocably waives, to the fullest extent it may
effectively do so, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum. Nothing in
65
this Section 10.4 shall affect the right of any Investor to bring any action or
proceeding against the Transferor or the Collection Agent or any of their
respective properties in the courts of other jurisdictions.
(b) EACH OF THE PARTIES HERETO HEREBY WAIVES ANY RIGHT TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE AMONG ANY OF THEM ARISING OUT OF, CONNECTED WITH, RELATING TO OR
INCIDENTAL TO THE RELATIONSHIP BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR
THE OTHER TRANSACTION DOCUMENTS.
(c) This Agreement contains the final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire Agreement among the parties hereto with respect to
the subject matter hereof superseding all prior oral or written understandings.
(d) The Transferor and NMC each hereby appoint Arent Fox ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
▇▇▇▇, located at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as the authorized agent
upon whom process may be served in any action arising out of or based upon this
Agreement, the other Transaction Documents to which such Person is a party or
the transactions contemplated hereby or thereby that may be instituted in the
United States District Court for the Southern District of New York and of any
New York State Court sitting in the City of New York by any Administrative
Agent, the Agent, any Investor, any Collateral Agent or any assignee of any of
them.
SECTION 10.5. Severability; Counterparts. 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.
SECTION 10.6. Successors and Assigns. (a) This Agreement shall be binding
on the parties hereto and their respective successors and assigns; provided,
however, that neither the Transferor nor the Collection Agent may assign any of
its rights or delegate any of its duties hereunder or under any of the other
Transaction Documents to which it is a party without the prior written consent
of each Administrative Agent. No provision of this Agreement shall in any manner
restrict the ability of any Conduit Investor, any Bank Investor to assign,
participate, grant security interests in, or otherwise transfer any portion of
the Transferred Interest.
(b) Each of the Transferor and the Collection Agent hereby agrees and
consents to the assignment by any Conduit Investor from time to time of all or
any part of its rights under, interest in and title to this Agreement and the
Transferred Interest to any Liquidity Provider for such Conduit Investor. In
addition, each of the Transferor and the Collection Agent hereby consents to and
acknowledges the assignment by any Conduit Investor of all of its rights under,
interest in and title to this Agreement and the Transferred Interest to the
related Collateral Agent.
SECTION 10.7. Waiver of Confidentiality. The Transferor hereby consents
to the disclosure of any non-public information with respect to it received by
any Conduit Investor, the Agent, any Bank Investor or any Administrative Agent
to any of the Conduit Investors, the Agent, any nationally recognized rating
agency rating the Commercial Paper of such Conduit Investor, any Administrative
Agent, any Collateral Agent, any Bank Investor or potential Bank Investor, any
Liquidity Provider or any Credit Support Provider in relation to this Agreement.
SECTION 10.8. Confidentiality Agreement. (a) Each of the parties hereto
hereby agrees that, from the commencement of discussions with respect to the
transactions contemplated by the Transaction Documents (the "Transaction"), each
of the parties hereto (and each of their respective, and their respective
affiliates, employees, officers, directors, advisors, representatives and
agents) are permitted to disclose to any and all Persons, without limitation of
any kind, the structure and tax aspects (as such terms are used in Internal
Revenue Code Sections 6011, 6111 and 6112 and the regulations promulgated
thereunder) of the Transaction, and all materials of any kind (including
opinions or other tax analyses) that are provided to any party related to such
structure and tax aspects. In this regard, the parties hereto acknowledge and
agree that the disclosure of the structure or tax aspects of the Transaction is
not limited in any way by an express or implied understanding or agreement, oral
or
66
written (whether or not such understanding or agreement is legally binding).
Furthermore, each of the parties hereto acknowledges and agrees that it does not
know or have reason to know that its use or disclosure of information relating
to the structure or tax aspects of the Transaction is limited in any other
manner (such as where the Transaction is claimed to be proprietary or exclusive)
for the benefit of any other Person.
(b) Subject to Section 10.8(a), each of the Transferor and the Collection
Agent hereby agrees that it will not disclose, and the Transferor will cause
each Parent Group Member to refrain from disclosing, the contents of this
Agreement or any other proprietary or confidential information of any Conduit
Investor, the Agent, any Administrative Agent, any Collateral Agent, any
Liquidity Provider or any Bank Investor to any other Person except (i) as
required by federal or state securities laws, (ii) its auditors and attorneys,
employees or financial advisors (other than any commercial bank) and any
nationally recognized rating agency provided such auditors, attorneys, employees
financial advisors or rating agencies are informed of the highly confidential
nature of such information or (iii) following notice thereof to each
Administrative Agent, as otherwise required by other applicable law or order of
a court of competent jurisdiction.
(c) Each Administrative Agent, each Investor and the Agent acknowledges
that it or its agents or representatives may, from time to time, obtain
knowledge of information, practices, books, correspondence and records
("Confidential Information") identified to it in writing as being of a
confidential nature or in which the Transferor or an Originating Entity has a
proprietary interest. Subject to Section 10.8(a), each Administrative Agent,
each Investor and the Agent agrees that all such Confidential Information so
obtained by it is to be regarded as confidential information and that such
Confidential Information may be subject to laws, rules and regulations regarding
patient confidentiality, and agrees that (x) it shall retain in confidence, and
shall ensure that its agents and representatives retain in confidence, and will
not disclose, any of such Confidential Information without the prior written
consent of the Transferor and (y) it will not, and will ensure that its agents
and representatives will not, make any use whatsoever (other than for purposes
of this Agreement) of any of such Confidential Information without the prior
written consent of the Transferor; provided, however, that such Confidential
Information may be disclosed to the extent that such Confidential Information
(i) may be or becomes generally available to the public (other than as a breach
of this Section 10.8(c), (ii) is required or appropriate in response to any
summons or subpoena in connection with any litigation or (iii) is required by
law to be disclosed; and provided, further, however, that such Confidential
Information may be disclosed to (A) the Agent, any Administrative Agent, any
Investor, any Credit Support Provider and any Liquidity Provider, subject to the
terms of this Section 10.8(c), (B) any such Person's legal counsel, auditors and
other business advisors, (C) any such Person's government regulators and (D) the
rating agencies rating any Commercial Paper issued by a Conduit Investor,
provided that the Person making such disclosure shall advise each recipient
thereof referred to in clauses (A), (B), (C) and (D) above that such
Confidential Information is to be regarded and maintained as confidential
information and that each Administrative Agent has agreed to keep confidential
such Confidential Information as provided in clauses (x) and (y) above.
Notwithstanding anything herein to the contrary, the parties hereto agree that
the Transferor and the Collection Agent shall not be required to furnish any
patient specific medical information to the extent the disclosure of such
information would violate applicable law, unless and until the recipient of such
information executes and delivers a business associate agreement in
substantially the form attached as Exhibit J.
SECTION 10.9. No Bankruptcy Petition Against Conduit Investors. Each of
the Transferor and the Collection Agent hereby covenants and agrees that, prior
to the date which is one year and one day after the payment in full of all
outstanding Commercial Paper or other indebtedness of any Conduit Investor, it
will not, and the Transferor will cause each Parent Group Member to not,
institute against, or encourage, assist or join any other Person in instituting
against, such Conduit Investor 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 or any other proceedings
related to an Event of Bankruptcy. Notwithstanding any provision contained in
this Agreement to the contrary, no Conduit Investor shall, nor shall any Conduit
Investor be obligated to, pay any amount pursuant to this Agreement unless (i)
the Conduit Investor has received funds which may be used to make such payment
in accordance with such Conduit Investor's commercial paper program documents,
which funds are not required to repay its Commercial Paper when due; and (ii)
after giving effect to such payment, either (x) there is sufficient liquidity
available (determined in accordance with such program
67
documents) to pay the Face Amount of all its Commercial Paper, (y) the Conduit
Investor is not rendered insolvent or (z) its Commercial Paper has been repaid
in full. Any amount which the Conduit Investor does not pay pursuant to the
operation of the preceding sentence shall not constitute a claim (as defined in
Section 101 of the United States Bankruptcy Code) against or a corporate
obligation of the Conduit Investor for any insufficiency. The provisions of this
Section shall survive the termination of this Agreement.
SECTION 10.10. No Recourse Against Stockholders, Officers or
Directors. No recourse under any obligation, covenant or agreement of any
Conduit Investor contained in this Agreement shall be had against Global
Securitization Services, LLC (nor any affiliate thereof), AMACAR Group L.L.C.
(nor any affiliate thereof), or any stockholder, officer or director of such
Conduit Investor, as such, by the enforcement of any assessment or by any legal
or equitable proceeding, by virtue of any statute or otherwise; it being
expressly agreed and understood that this Agreement is solely a corporate
obligation of such Conduit Investor, and that no personal liability whatsoever
shall attach to or be incurred by Global Securitization Services, LLC (or any
affiliate thereof), AMACAR Group L.L.C. (or any affiliate thereof), or the
stockholders, officers, or directors of such Conduit Investor, as such, or any
of them, under or by reason of any of the obligations, covenants or agreements
of such Conduit Investor contained in this Agreement, or implied therefrom, and
that any and all personal liability for breaches by a Conduit Investor of any of
such obligations, covenants or agreements, either at common law or at equity, or
by statute or constitution, of Global Securitization Services , LLC (or any
affiliate thereof), AMACAR Group L.L.C. (or any affiliate thereof) and every
such stockholder, officer or director of such Conduit Investor is hereby
expressly waived as a condition of and consideration for the execution of this
Agreement.
SECTION 10.11. Characterization of the Transactions Contemplated by the
Agreement. It is the intention of the parties that the transactions
contemplated hereby constitute the sale of the Transferred Interest, conveying
good title thereto free and clear of any Adverse Claims to the Agent, on behalf
of the Investors, and that the Transferred Interest not be part of the
Transferor's estate in the event of an insolvency. If, notwithstanding the
foregoing, the transactions contemplated hereby should be deemed a financing,
the parties intend that the Transferor shall be deemed to have granted to the
Agent, on behalf of the Investors, and the Transferor hereby grants to the
Agent, on behalf of the Investors, a first priority perfected and continuing
security interest in all of the Transferor's right, title and interest in, to
and under the Receivables, together with Related Security, Collections and
Proceeds with respect thereto, and together with all of the Transferor's rights
under the Receivables Purchase Agreement, the Transferring Affiliate Letter, the
BMA Transfer Agreement and all other Transaction Documents with respect to the
Receivables and with respect to any obligations thereunder of any Originating
Entity with respect to the Receivables, and that this Agreement shall constitute
a security agreement under applicable law. The Transferor hereby assigns to the
Agent, on behalf of the Investors, all of its rights and remedies under the
Receivables Purchase Agreement, the Transferring Affiliate Letter and the BMA
Transfer Agreement (and all instruments, documents and agreements executed in
connection therewith) with respect to the Receivables and with respect to any
obligations thereunder of any Originating Entity with respect to the
Receivables.
[Remainder of page intentionally left blank]
68
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Transfer and Administration Agreement as of the date first written above.
PARADIGM FUNDING LLC,
as a Conduit Investor
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
GIRO MULTI-FUNDING CORPORATION,
as a Conduit Investor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
ASSET ONE SECURITIZATION, LLC,
as a Conduit Investor
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
LIBERTY STREET FUNDING CORP.,
as a Conduit Investor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
69
NMC FUNDING CORPORATION,
as Transferor
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Treasurer
NATIONAL MEDICAL CARE, INC.,
as Collection Agent
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Treasurer
WESTLB AG, New York Branch,
as Agent, an Administrative Agent and
as a Bank Investor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Director, Global
Specialized Finance
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director
▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇
Branch,
as an Administrative Agent
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
By: /s/ ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇
Title: Vice President
BAYERISCHE LANDESBANK, Cayman Islands
Branch,
as a Bank Investor
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
71
SOCIETE GENERALE,
as an Administrative Agent and as a
Bank Investor
By: /s/ CHIN-EAV EAP
------------------------------------
Name: Chin-Eav Eap
Title: Vice President
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Director
THE BANK OF NOVA SCOTIA,
as an Administrative Agent and as a
Bank Investor
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Director
LANDESBANK HESSEN-THUERINGEN
GIROZENTRALE,
as a Bank Investor
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Associate
72
SCHEDULE I
TO
THIRD AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
NOTICE ADDRESSES FOR BANK INVESTORS
WESTLB AG, NEW YORK BRANCH
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
BAYERISCHE LANDESBANK, CAYMAN ISLANDS BRANCH
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇-▇▇▇ ▇▇▇▇▇▇
Tel: 212/▇▇▇-▇▇▇▇
Telecopy: 212/230-9020
LANDESBANK HESSEN -- THUERINGEN GIROZENTRALE
Neue ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇-▇▇
▇-▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Tel: ▇▇▇▇▇-▇▇-▇▇▇▇-▇▇▇▇
Fax: ▇▇▇▇▇-▇▇-▇▇▇▇-▇▇▇▇
SOCIETE GENERALE
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chin-Eav Eap
Tel: 212/▇▇▇-▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
THE BANK OF NOVA SCOTIA
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇
Tel: 212/▇▇▇-▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
with a copy to:
The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel: 212/▇▇▇-▇▇▇▇
Fax: 212/▇▇▇-▇▇▇▇
SCHEDULE II
TO
THIRD AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
A. COMMITMENTS OF BANK INVESTORS
BANK INVESTOR COMMITMENT
------------- ----------
WestLB AG, New York Branch.................................. $130,000,000
Bayerische Landesbank, Cayman Islands Branch................ $120,000,000
Scotiabank.................................................. $100,000,000
Societe Generale............................................ $ 60,000,000
Landesbank Hessen - Thueringen Girozentrale................. $ 50,000,000