Exhibit 10.23
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CREDIT AND SECURITY AGREEMENT
dated as of November 29, 2000
among
PACKAGING RECEIVABLES COMPANY, LLC,
as Borrower
PACKAGING CREDIT COMPANY, LLC,
as Initial Servicer
BLUE RIDGE ASSET FUNDING CORPORATION,
as a Lender
and
WACHOVIA BANK, N.A.,
individually as a Lender and as Agent
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TABLE OF CONTENTS
SECTION HEADING PAGE
ARTICLE I THE CREDIT......................................................... 2
Section 1.1. The Facility....................................................... 2
Section 1.2. Funding Mechanics; Liquidity Fundings.............................. 2
Section 1.3. Interest Rates..................................................... 3
Section 1.4. Payment Dates; Noteless Agreement.................................. 4
Section 1.5. Prepayments........................................................ 4
Section 1.6. Reductions in Aggregate Commitment................................. 5
Section 1.7. Requests for Increases in Aggregate Commitment..................... 5
Section 1.8. Extension of the Scheduled Termination Date........................ 5
Section 1.9. Distribution of Certain Notices; Notification of Interest Rates.... 6
ARTICLE II BORROWING AND PAYMENT MECHANICS; CERTAIN
COMPUTATIONS....................................................... 6
Section 2.1. Method of Borrowing................................................ 6
Section 2.2. Selection of CP Tranche Periods and Interest Periods............... 6
Section 2.3. Computation of Concentration Limits and Unpaid Balance............. 7
Section 2.4. Maximum Interest Rate.............................................. 7
Section 2.5. Payments and Computations, Etc..................................... 7
Section 2.6. Non-Receipt of Funds by the Agent.................................. 8
ARTICLE III SETTLEMENTS........................................................ 8
Section 3.1. Reporting.......................................................... 8
Section 3.2. Allocations and Distributions...................................... 8
Section 3.3. Non-Distribution of Servicer's Fee................................. 10
Section 3.4. Deemed Collections................................................. 10
ARTICLE IV FEES AND YIELD PROTECTION.......................................... 11
Section 4.1. Fees............................................................... 11
Section 4.2. Yield Protection................................................... 11
Section 4.3. Funding Losses..................................................... 13
ARTICLE V CONDITIONS OF ADVANCES............................................. 13
Section 5.1. Conditions Precedent to Initial Advance............................ 13
Section 5.2. Conditions Precedent to All Advances............................... 15
ARTICLE VI REPRESENTATIONS AND WARRANTIES..................................... 16
Section 6.1. Representations and Warranties of the Borrower..................... 16
ARTICLE VII GENERAL COVENANTS OF THE BORROWER.................................. 19
Section 7.1. Affirmative Covenants of the Borrower.............................. 19
Section 7.2. Reporting Requirements of the Borrower............................. 21
Section 7.3. Negative Covenants of the Borrower................................. 23
Section 7.4. Separate Corporate Existence of the Borrower....................... 25
ARTICLE VIII ADMINISTRATION AND COLLECTION...................................... 28
Section 8.1. Designation of Servicer............................................ 28
Section 8.2. Duties of Servicer................................................. 29
Section 8.3. Rights of the Agent................................................ 30
Section 8.4. Responsibilities of the Borrower................................... 31
Section 8.5. Further Action Evidencing the Security Interest.................... 31
Section 8.6. Application of Collections......................................... 32
ARTICLE IX SECURITY INTEREST.................................................. 32
Section 9.1. Grant of Security Interest......................................... 32
Section 9.2. Remedies........................................................... 32
Section 9.3. Termination after Final Payout Date................................ 32
Section 9.4. Limitation on Rights to Collateral Proceeds........................ 32
ARTICLE X EVENTS OF DEFAULT.................................................. 32
Section 10.1. Events of Default.................................................. 32
Section 10.2. Remedies........................................................... 35
ARTICLE XI THE AGENT.......................................................... 35
Section 11.1. Appointment........................................................ 35
Section 11.2. Delegation of Duties............................................... 36
Section 11.3. Exculpatory Provisions............................................. 36
Section 11.4 Reliance by Agent.................................................. 36
Section 11.5. Notice of Events of Default........................................ 37
Section 11.6. Non-Reliance on Agent and Other Lenders............................ 37
Section 11.7. Indemnification of Agent........................................... 37
Section 11.8. Agent in its Individual Capacity................................... 38
Section 11.9. Successor Agent.................................................... 38
Section 11.10. Agent's Conflict Waivers........................................... 38
Section 11.11. UCC Filings........................................................ 38
ARTICLE XII ASSIGNMENTS AND PARTICIPATIONS..................................... 39
Section 12.1. Restrictions on Assignments, etc................................... 39
Section 12.2. Rights of Assignees and Participants............................... 39
Section 12.3. Terms and Evidence of Assignment................................... 39
ARTICLE XIII INDEMNIFICATION.................................................... 40
Section 13.1. Indemnities by the Borrower........................................ 40
Section 13.2. Indemnities by Servicer............................................ 42
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ARTICLE XIV MISCELLANEOUS...................................................... 43
Section 14.1. Amendments, Etc. .................................................. 43
Section 14.2. Notices, Etc. ..................................................... 43
Section 14.3. No Waiver; Remedies................................................ 43
Section 14.4. Binding Effect; Survival........................................... 44
Section 14.5. Costs, Expenses and Taxes.......................................... 44
Section 14.6. No Proceedings..................................................... 45
Section 14.7. Confidentiality of Borrower Information............................ 45
Section 14.8. Confidentiality of Program Information............................. 47
Section 14.9. Captions and Cross References...................................... 48
Section 14.10. Integration........................................................ 48
Section 14.11. Governing Law...................................................... 48
Section 14.12. Waiver of Jury Trial............................................... 48
Section 14.13. Consent to Jurisdiction; Waiver of Immunities...................... 49
Section 14.14. Execution in Counterparts.......................................... 49
Section 14.15. No Recourse Against Other Parties.................................. 49
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CREDIT AND SECURITY AGREEMENT
THIS
CREDIT AND SECURITY AGREEMENT is entered into as of November 29, 2000,
by and among:
(1) Packaging Receivables Company LLC, a Delaware limited liability
company (together with its successors and permitted assigns, the
"BORROWER"),
(2) Packaging Credit Company, LLC, a Delaware limited liability
company (together with its successors, "INITIAL SERVICER"), as initial
servicer hereunder (in such capacity, together with any successor servicer
or sub-servicer appointed pursuant to Section 8.1, the "SERVICER"),
(3) Blue Ridge Asset Funding Corporation, a Delaware corporation
(together with its successors, "BLUE RIDGE"), and Wachovia Bank, N.A., a
national banking association, in its capacity as a Liquidity Bank to Blue
Ridge (together with its successors, "WACHOVIA"), as Lenders (hereinafter
defined), and
(4) Wachovia Bank, N.A., as agent for the Lenders (in such capacity,
together with any successors thereto in such capacity, the "AGENT").
Unless otherwise indicated, capitalized terms used in this Agreement are
defined in Annex A.
W I T N E S S E T H:
WHEREAS, the Borrower is a wholly-owned subsidiary of Packaging Corporation
of America;
WHEREAS, Packaging Corporation of America, as Originator, and Packaging
Credit Company, LLC ("SELLER") have entered into a Receivables Sale Agreement
(the "SALE AGREEMENT") pursuant to which the Originator has sold, and hereafter
will sell, to the Seller all of its right, title and interest in and to its
accounts receivable and certain related rights;
WHEREAS, the Seller sells or contributes to the Borrower under the Purchase
and Sale Agreement all of its right, title and interest in and to its accounts
receivable and certain related rights;
WHEREAS, the Borrower has requested that the Lenders make revolving loans
to the Borrower from time to time hereafter secured by the Collateral, and,
subject to the terms and conditions contained in this Agreement, the Lenders are
willing to make such secured loans;
WHEREAS, the Lenders have requested that Initial Servicer act as the
initial Servicer for the Collateral, and, subject to the terms and conditions
contained in this Agreement, Initial Servicer is willing to act in such
capacity; and
WHEREAS, Wachovia has been requested, and is willing, to act as the Agent
under this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein contained, the parties hereto hereby agree as follows:
ARTICLE I
THE CREDIT
SECTION 1.1. THE FACILITY. On the terms and subject to the conditions set
forth in this Agreement, the Borrower (or the Servicer on the Borrower's behalf)
may from time to time during the Revolving Period request Advances by delivering
a Borrowing Request to the Agent in accordance with Section 2.1. Upon receipt of
a copy of each Borrowing Request from the Borrower or Servicer, the Agent shall
advise the Borrower not later than 12:00 noon (
New York City time) on the
Business Day following such receipt whether Blue Ridge and/or the Liquidity
Banks will fund a Loan (or Loans) in the aggregate amount of the requested
Advance, and in the event that Blue Ridge elects not to make any such Loan to
the Borrower, each of the Liquidity Banks severally agrees to make its Ratable
Share of such Loan to the Borrower, on the terms and subject to the conditions
hereof, provided that at no time may the aggregate principal amount of Blue
Ridge's and the Liquidity Banks' Loans at any one time outstanding exceed the
lesser of (i) the aggregate amount of the Liquidity Banks' Commitments, and (ii)
the Borrowing Base (such lesser amount, the "ALLOCATION LIMIT"). If the Agent
advises the Borrower that Blue Ridge elects not to fund a Loan, the Borrower or
Servicer may rescind the Borrowing Request. Each Loan shall be in the minimum
amount of $1,000,000 or a larger integral multiple of $500,000. In no event may
the aggregate principal amount of the Advances hereunder exceed the lesser of
(x) the Aggregate Commitment, or (y) the Borrowing Base. All Liquidity Banks'
Commitments shall terminate on the Termination Date. Each of the Loans, and all
other Obligations of the Borrower, shall be secured by the Collateral as
provided in Article IX.
SECTION 1.2. FUNDING MECHANICS; LIQUIDITY FUNDINGS. (a) Each Advance
hereunder shall consist of Loans made from Blue Ridge and/or the Liquidity
Banks.
(b) If a Liquidity Bank fails to transfer to the Agent its full Ratable
Share of any Loan when required by Section 1.1 (the aggregate amount not made
available to the Agent by each such Liquidity Bank being the "UNPAID AMOUNT"),
then, upon notice from the Agent by not later than 1:15 p.m. (Chicago time),
each Liquidity Bank not owing an Unpaid Amount shall transfer to the Agent, by
not later than 1:45 p.m. (Chicago time), an amount equal to the lesser of such
Liquidity Bank's proportionate share (based on its Commitment divided by the
Commitments of all Liquidity Banks that have not so failed to pay their full
Ratable Share) of the Unpaid Amount and its Commitment. If the Agent does not
then receive the Unpaid Amount in full, upon notice from the Agent by not later
than 2:00 p.m. (Chicago time) on such day, each Liquidity Bank that has not
failed to fund any part of its obligations on such day under this Section 1.2
shall pay to the Agent, by not later than 2:30 p.m. (Chicago time), its
proportionate share (determined as described above) of the amount of such
remaining deficiency up to the amount of its unused Commitment. Any Liquidity
Bank that fails to make a payment under this Section 1.2 on the date of a
Liquidity Funding shall pay on demand to each other Liquidity Bank that makes a
payment under this subsection (b) the amount paid by it to cover such failure,
together with interest thereon, for each day from the date such payment was made
until the date such other Liquidity Bank has been paid such amount in full, at a
rate per annum equal to the Federal Funds Rate plus two percent (2%) per annum.
In addition, without prejudice to any other rights Blue Ridge may have under
applicable
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law, any Liquidity Bank that has failed to transfer to the Agent under Section
1.1 its full Ratable Share of any Loan shall pay on demand to Blue Ridge the
difference between such unpaid Ratable Share of such Loan and the amount paid by
other Liquidity Banks or the Agent to cover such failure, together with interest
thereon, for each day from the date such Ratable Share of such Loan was due
until the date paid, at a rate per annum equal to the Federal Funds Rate plus
two percent (2%) per annum.
(c) While it is the intent of Blue Ridge to fund each requested Advance
through the issuance of Commercial Paper Notes, the parties acknowledge that if
Blue Ridge is unable, or determines that it is undesirable, to issue Commercial
Paper Notes to fund all or any portion the Loans at a CP Rate, or is unable to
repay such Commercial Paper Notes upon the maturity thereof, Blue Ridge may put
all or any portion of its Loans to the Liquidity Banks at any time pursuant to
the Liquidity Agreement to finance or refinance the necessary portion of its
Loans through a Liquidity Funding to the extent available. The Liquidity
Fundings may be Alternate Base Rate Loans or Eurodollar Loans, or a combination
thereof, selected by the Borrower in accordance with Article II. In addition,
the parties acknowledge that Commercial Paper Notes are issued at a discount and
at varying discount rates; accordingly, it may not be possible for all CP Rate
Loans to be made in amounts precisely equal to the amounts specified in a
Borrowing Request. Regardless of whether a Liquidity Funding constitutes an
assignment of a Loan or the sale of one or more participations therein, each
Liquidity Bank participating in a Liquidity Funding shall have the rights of a
"Lender" hereunder with the same force and effect as if it had directly made a
Loan to the Borrower in the amount of its Liquidity Funding.
(d) Nothing herein shall be deemed to commit any Lender to make CP Rate
Loans.
SECTION 1.3. INTEREST RATES. (a) Each CP Rate Loan shall bear interest on
the outstanding principal amount thereof from and including the first day of the
CP Tranche Period applicable thereto selected in accordance with Article II of
this Agreement to (but not including) the last day of such CP Tranche Period at
the applicable CP Rate.
(b) Each Eurodollar Loan shall bear interest on the outstanding principal
amount thereof from and including the first day of the Interest Period
applicable thereto selected in accordance with Article II of this Agreement to
(but not including) the last day of such Interest Period at a rate per annum
equal to the sum of (i) the applicable Eurodollar Rate (Reserve Adjusted) for
such Interest Period plus (ii) the Bank Rate Spread.
(c) Each Alternate Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from and including the date such Loan is
made to but excluding the date it is paid at a rate per annum equal to the
Alternate Base Rate for such day. Changes in the rate of interest on Alternate
Base Rate Loans will take effect simultaneously with each change in the
Alternate Base Rate.
(d) Notwithstanding anything to the contrary contained in Sections 1.3(a),
(b) or (c), upon the occurrence of an Event of Default, and during the
continuance thereof, all Obligations shall bear interest, payable upon demand,
at the Default Rate.
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(e) Interest at any of the aforementioned rates shall be calculated for
actual days elapsed on the basis of a 360-day year. Interest shall be payable
for the day a Loan is made but not for the day of any payment on the amount paid
if payment is received prior to noon (local time) at the place of payment. If
any payment of principal of or interest on a Loan shall become due on a day
which is not a Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such extension of time
shall be included in computing interest in connection with such payment.
SECTION 1.4. PAYMENT DATES; NOTELESS AGREEMENT. (a) The Borrower promises to
pay each CP Rate Loan on the last day of its CP Tranche Period.
(b) The Borrower promises to pay each Eurodollar Loan on the last day of
its Interest Period.
(c) The Borrower promises to pay each Alternate Base Rate Loan, together
with all accrued and unpaid interest thereon, on or before the earlier to occur
of (i) the Termination Date, and (ii) refinancing of such Loan with a CP Rate
Loan or a Eurodollar Rate Loan.
(d) The Borrower promises to pay all accrued and unpaid interest on each
Loan on its applicable Interest Payment Date.
(e) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time hereunder. Upon request of the Borrower or the Agent, such Lender will
confirm the outstanding principal balances of its Loans and the amount of any
accrued and unpaid interest thereon. The entries maintained in the accounts
maintained pursuant to this Section shall be prima facie evidence of the
existence and amounts of the Obligations therein recorded; PROVIDED, HOWEVER,
that the failure of any Lender to maintain such accounts or any error therein
shall not in any manner affect the obligation of the Borrower to repay the
Obligations in accordance with their terms.
SECTION 1.5. PREPAYMENTS. Subject, in the case of CP Rate Loans and
Eurodollar Loans, to the funding indemnification provisions of Section 4.3:
(a) The Borrower may from time to time prepay, without penalty or
premium, all outstanding Loans, or, in a minimum aggregate amount of
$2,000,000 (or a larger integral multiple of $1,000,000), any portion of
the outstanding Loans upon two Business Days' prior written notice to the
Agent (each, a "PREPAYMENT NOTICE"), PROVIDED that each such prepayment of
principal is accompanied by a payment of all accrued and unpaid interest
thereon and is made ratably amongst the Lenders; it being understood that
the Borrower, in its discretion, may designate the outstanding Loans to
which the Agent will apply each such prepayment or portion thereof, subject
to, in the case of CP Rate Loans or Eurodollar Loans, the funding
indemnification provisions of Section 4.3 hereof;
(b) If on any Business Day, the aggregate outstanding principal amount
of Blue Ridge's Loans and the Liquidity Fundings made by the Liquidity
Banks exceeds the
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Allocation Limit, the Borrower shall prepay such Loans, subject, in the
case of CP Rate Loans and Eurodollar Loans, to the funding indemnification
provision of Section 4.3 but otherwise without premium or penalty, by
initiating a wire transfer to the Agent not later than 11:00 a.m. (
New York
City time) on the second Business Day thereafter in an amount sufficient to
eliminate such excess, together with interest accrued and to accrue unpaid
on the amount prepaid; and
(c) Upon receipt of any wire transfer pursuant to Section 1.5(b), the
Agent shall initiate a wire transfer to the Lenders of their respective
shares thereof not later than 11:00 a.m. (
New York City time) on the date
when received.
SECTION 1.6. REDUCTIONS IN AGGREGATE COMMITMENT. The Borrower may
permanently reduce the Aggregate Commitment in whole, or ratably in part, in a
minimum amount of $5,000,000 (or a larger integral multiple of $1,000,000), upon
at least five Business Days' written notice to the Agent (each, a "COMMITMENT
REDUCTION NOTICE"), PROVIDED, HOWEVER, that (a) the amount of the Aggregate
Commitment may not be reduced below the aggregate principal amount of the
outstanding Advances, and (b) the amount of the Aggregate Commitment may not be
reduced below $5,000,000 unless the Aggregate Commitment is terminated in full.
All accrued and unpaid fees shall be payable on the effective date of any
termination of the Aggregate Commitment. Each Commitment Reduction Notice shall
be irrevocable once delivered to the Agent.
SECTION 1.7. REQUESTS FOR INCREASES IN AGGREGATE COMMITMENT. The Borrower
may from time to time request increases in the Aggregate Commitment in a minimum
amount of $5,000,000 (or a larger integral multiple of $1,000,000), upon at
least 30 days' prior written notice to the Agent, which notice shall specify the
amount of and proposed effective date for any such requested increase (each, a
"COMMITMENT INCREASE REQUEST"). If each of the Lenders agrees to the requested
increase by notifying the Agent and the Borrower in writing of their
concurrence, such increase shall be made to the Commitments of the Liquidity
Banks, ratably in accordance with their respective Ratable Shares as of the
effective date specified in the Commitment Increase Request. If less than all of
the Lenders agree to such increase, the amount of the Aggregate Commitment shall
remain unchanged.
SECTION 1.8. EXTENSION OF THE SCHEDULED TERMINATION DATE. Provided that no
Event of Default exists and is continuing, the Borrower may request an extension
of the Scheduled Termination Date by submitting a request for an extension
(each, an "EXTENSION REQUEST") to the Agent no more than 60 days prior to the
Scheduled Termination Date then in effect. The Extension Request must specify
the new Scheduled Termination Date requested by the Borrower and the date (which
must be at least 30 days after the Extension Request is delivered to the Agent)
as of which the Agent, the Lenders and the Liquidity Banks must respond to the
Extension Request (the "RESPONSE DATE"). The new Scheduled Termination Date
shall be no more than 364 days after the Scheduled Termination Date in effect at
the time the Extension Request is received, including the Scheduled Termination
Date as one of the days in the calculation of the days elapsed. Promptly upon
receipt of an Extension Request, the Agent shall notify Blue Ridge and the
Liquidity Banks of the contents thereof and shall request each such Person to
approve the Extension Request. Each Lender and Liquidity Bank approving the
Extension Request shall deliver its written approval to the Agent no later than
the Response Date, whereupon the Agent shall notify the Borrower within one
Business Day thereafter as to whether all of the Lenders have approved the
Extension Request. If all of the Lenders have approved the Extension Request,
the Scheduled Termination Date specified in
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the Extension Request shall become effective on the existing Scheduled
Termination Date, and the Agent shall promptly notify the Borrower and the
Lenders of the new Scheduled Termination Date. If all of the Lenders do not
unanimously agree to an Extension Request, the Scheduled Termination Date shall
remain unchanged.
SECTION 1.9. DISTRIBUTION OF CERTAIN NOTICES; NOTIFICATION OF INTEREST
RATES. Promptly after receipt thereof, the Agent will notify Blue Ridge and the
Liquidity Banks of the contents of each Information Package, Borrowing Request,
Extension Request, Commitment Reduction Notice, Prepayment Notice, Commitment
Increase Request or notice of default received by it from the Borrower or the
Servicer hereunder. In addition, the Agent shall promptly notify the Lenders and
the Borrower of each determination of and change in Interest Rates.
ARTICLE II
BORROWING AND PAYMENT MECHANICS; CERTAIN COMPUTATIONS
SECTION 2.1. METHOD OF BORROWING. The Borrower (or the Servicer on the
Borrower's behalf) shall give the Agent irrevocable notice in the form of
Exhibit 2.1 hereto (each, a "BORROWING REQUEST") not later than 12:00 noon (
New
York City time) at least two Business Days before the Borrowing Date of each
Advance. On each Borrowing Date, each Lender shall make available its Loan or
Loans in immediately available funds to the Agent by initiating a wire transfer
in such amount not later than 10:00 a.m. (
New York City time). Subject to its
receipt of such wire transfers, the Agent will initiate a wire transfer of the
funds so received from the Lenders to the Borrower at the account specified in
its Borrowing Request not later than 11:00 a.m. (
New York City time) on the
applicable Borrowing Date. Neither the Borrower, nor the Servicer on the
Borrower's behalf, may deliver more than 4 Borrowing Requests in any month.
SECTION 2.2. SELECTION OF CP TRANCHE PERIODS AND INTEREST PERIODS. Prior to
the occurrence of an Event of Default, the Borrower or the Servicer in its
Borrowing Request may request CP Tranche Periods (or, in the case of Liquidity
Fundings, Interest Periods) from time to time to apply to each Lender's CP Rate
Loans or Eurodollar Loans, as applicable; provided, however, that (i) at least
one CP Tranche Period or one Interest Period shall mature on each Settlement
Date, and (ii) no CP Tranche Period or Interest Period which began prior to the
Scheduled Termination Date shall extend beyond the Scheduled Termination Date.
While the Agent will use reasonable efforts to accommodate the Borrower's
or the Servicer's requests for CP Tranche Periods or Interest Periods prior to
an Event of Default, the Agent shall have the right to subdivide any requested
Loan into one or more Loans of different CP Tranche Periods or Interest Periods,
as the case may be, or, if the requested period is not feasible, to suggest an
alternative CP Tranche Period or Interest Period, provided that not less than
$1,000,000 of principal may be allocated to any CP Tranche Period or Interest
Period of any Lender, and no Alternate Base Rate Loan may have a principal
amount of less than $1,000,000.
The Borrower (or the Servicer on the Borrower's behalf) may not request an
Interest Period for a Eurodollar Loan unless it shall have given the Agent
written notice of its desire therefor not later than 12:00 noon (
New York City
time) at least 3 Business Days prior to the first day of the desired Interest
Period. Accordingly, all Liquidity Fundings shall initially be Alternate Base
Rate Loans.
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Unless the Agent shall have received written notice by 12:00 noon (
New York
City time) on the second Business Day prior to the last day of a CP Tranche
Period that the Borrower intends to reduce or increase the aggregate principal
amount of the CP Rate Loans outstanding, unless an Event of Default exists and
is continuing or Blue Ridge determines that it must avail itself of a Liquidity
Funding, Blue Ridge shall be entitled to assume that the Borrower desires to
refinance the principal and interest maturing CP Rate Loan on the last day of
its CP Tranche Period with a new CP Rate Loan with CP Tranche Periods selected
by the Agent. In addition, in the event and to the extent Blue Ridge cannot
issue Commercial Paper Notes or avail itself of a Liquidity Funding, in either
case, in an amount necessary to refinance the maturing CP Rate Loan and the
accrued and unpaid interest thereon, Blue Ridge may, by notice to the Agent, the
Seller and the Servicer, require the mandatory prepayment of all outstanding CP
Rate Loans in accordance with Section 3.2 hereof.
Unless the Agent shall have received written notice by 12:00 noon (
New York
City time) on the third Business Day prior to the last day of an Interest Period
that the Borrower intends to reduce the aggregate principal amount of the
Eurodollar Loans outstanding from the Liquidity Banks, each of the Liquidity
Banks shall be entitled to assume that the Borrower desires to refinance its
maturing Eurodollar Loans on the last day of such Interest Period with
Eurodollar Loans with an Interest Period of one month.
The Agent acknowledges and agrees that a Borrowing Request shall not be
required in connection with the refinancing on the last day of an Interest
Period of maturing CP Rate Loans or maturing Eurodollar Loans.
(c) If the Agent or any Liquidity Bank determines (i) that maintenance of
any Eurodollar Loan would violate any applicable law or regulation, (ii) that
deposits of a type and maturity appropriate to match fund any of such Liquidity
Bank's Eurodollar Loans are not available or (iii) that the maintenance of any
Eurodollar Loans will not adequately and fairly reflect the cost of such
Liquidity Bank of funding Eurodollar Loans, then the Agent, upon the direction
of such Liquidity Bank, shall suspend the availability of future Eurodollar
Loans until such time as the Agent or applicable Liquidity Bank provides notice
that the circumstances giving rise to such suspension no longer exist, and, if
required by any applicable law or regulation, terminate any outstanding
Eurodollar Loan so affected. All Loans allocated to any such terminated
Eurodollar Loan shall be reallocated to an Alternative Base Rate Loan.
SECTION 2.3. COMPUTATION OF CONCENTRATION LIMITS AND UNPAID BALANCE. The
Obligor Concentration Limits and the aggregate Unpaid Balance of Receivables of
each Obligor and its Affiliated Obligors (if any) shall be calculated as if each
such Obligor and its Affiliated Obligors were one Obligor.
SECTION 2.4. MAXIMUM INTEREST RATE. No provision of this Agreement shall
require the payment or permit the collection of interest in excess of the
maximum permitted by applicable law.
SECTION 2.5. PAYMENTS AND COMPUTATIONS, Etc. (a) PAYMENTS. The Borrower or
the Servicer, as the case may be, shall initiate a wire transfer of immediately
available funds of all amounts to be paid or deposited by the Borrower or the
Servicer to the Agent or any of the Lenders (other than amounts payable under
Section 4.2) no later than 11:00 a.m. (
New York City time) on the day when due
in lawful money of the United States of America to the Agent at its address
specified in
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Schedule 14.2, and, to the extent such payment is for the account of a Lender,
the Agent shall promptly disburse such funds to the appropriate Lender.
(b) LATE PAYMENTS. To the extent permitted by law, upon demand, the
Borrower or the Servicer, as applicable, shall pay to the Agent for the account
of each Person to whom payment of any Obligation is due, interest on all amounts
not paid or deposited by 2:00 p.m. (New York City time) on the date when due
(without taking into account any applicable grace period) at the Default Rate as
specified in Section 10.1(a), provided, however, that no such interest rate
shall at any time exceed the maximum rate permitted by applicable law.
(c) METHOD OF COMPUTATION. All computations of interest, Servicer's Fee,
any per annum fees payable under Section 4.1 and any other per annum fees
payable by the Borrower to the Lenders, the Servicer or the Agent under the Loan
Documents shall be made on the basis of a year of 360 days for the actual number
of days (including the first day but excluding the last day) elapsed.
(d) AVOIDANCE OR RECISSION OF PAYMENTS. To the maximum extent permitted by
applicable law, no payment of any Obligation shall be considered to have been
paid if at any time such payment is rescinded or must be returned for any
reason.
SECTION 2.6. NON-RECEIPT OF FUNDS BY THE AGENT. Unless a Lender notifies the
Agent prior to the date and time on which it is scheduled to fund a Loan that it
does not intend to fund, the Agent may assume that such funding will be made and
may, but shall not be obligated to, make the amount of such Loan available to
the intended recipient in reliance upon such assumption. If such Lender has not
in fact funded its Loan proceeds to the Agent, the recipient of such payment
shall, on demand by the Agent, repay to the Agent the amount so made available
together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Agent until the
date the Agent recovers such amount at a rate per annum equal to the Federal
Funds Rate for such day.
ARTICLE III
SETTLEMENTS
SECTION 3.1. REPORTING. (a) INFORMATION PACKAGES. On the 15th Business Day
after each Cut-Off Date hereafter (each, a "REPORTING DATE"), the Servicer shall
deliver to the Agent, a report in the form of Exhibit 3.1(a) (each, an
"INFORMATION PACKAGE") accompanied by an electronic file in a form reasonably
satisfactory to the Agent; PROVIDED, HOWEVER, that if an Event of Default shall
exist and be continuing, the Agent may request that a computation of the
Borrowing Base be made more frequently than monthly but no more frequently than
once per day.
(b) INTEREST; OTHER AMOUNTS DUE. At or before 12:00 noon (New York City
time) on the Business Day before each Settlement Date, the Agent shall notify
the Borrower and the Servicer of (i) the aggregate principal balance of all
Loans made by the Lenders that are then outstanding, and (ii) the aggregate
amount of all principal, interest and fees that will be due and payable by the
Borrower to the Agent for the account of the Agent or the Lenders on such
Settlement Date.
SECTION 3.2. ALLOCATIONS AND DISTRIBUTIONS.
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(a) MANDATORY PREPAYMENT. On each day which occurs (i) before the
Termination Date and after the date on which Blue Ridge delivers the notice
requiring prepayment of outstanding CP Rate Loans pursuant to Section 2.2
hereof, the Servicer (i) shall set aside and hold in trust solely for the
benefit of Blue Ridge (or deliver to the Collection Account if required pursuant
to Section 7.1(i) hereof) Blue Ridge's Ratable Share in the Percentage Share of
all Collections received on such day (the "RETAINED COLLECTIONS"). To the extent
the Retained Collections are not required to pay interest, fees and Servicing
Fee due on any date prior to the last day of a CP Tranche Period ("PRIOR USES"),
then the Servicer shall distribute the Retained Collections (net of the amount
of Prior Uses) in the following order of priority, in each case only to the
extent of amounts available therefor:
(i) FIRST, to the Agent (for the benefit of Blue Ridge) all interest
due but not already paid to Blue Ridge;
(ii) SECOND, to the Agent (for the benefit of Blue Ridge) the
outstanding principal balance of all Loans made by Blue Ridge;
(iii) THIRD, to the Agent (for the benefit of Blue Ridge) all other
amounts owed to Blue Ridge;
(iv) FOURTH, to be retained in trust by the Servicer, to the extent of
the principal and interest that will be due on the last day of any
subsequent CP Tranche Period with respect to any other outstanding CP Rate
Loan as to which the Servicer has received a notice requiring prepayment of
such outstanding CP Rate Loan pursuant to Section 2.2 hereof;
(v) FIFTH, to the Servicer until all amounts owed to the Servicer
under the Agreement have been paid in full; and
(vi) SIXTH, to the Borrower (or as otherwise required by applicable
law).
(b) TERMINATION DATE. On each day on and after the Termination Date, the
Servicer shall set aside and hold in trust solely for the account of the Agent,
for the benefit of the Agent and the Lenders, (or delivered to the Collection
Account as required pursuant to Section 7.1(i) hereof) the Percentage Share of
all Collections received on such day and such Collections shall be allocated as
follows:
(i) FIRST, to the Lenders (ratably, based on their Ratable Share)
until all Loans of, and interest due but not already paid to, the Lenders
have been paid in full;
(ii) SECOND, to the Lenders until all other amounts owed to the
Lenders have been paid in full;
(iii) THIRD, to the Agent until all amounts owed to the Agent have
been paid in full;
(iv) FOURTH, to any other Person to whom any amounts are owed under
the Transaction Documents until all such amounts have been paid in full;
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(v) FIFTH, to the Servicer until all amounts owed to the Servicer
under the Agreement have been paid in full; and
(vi) SIXTH, to the Borrower (or as otherwise required by applicable
law).
On the last day of each Tranche Period, the Servicer shall deposit with the
Agent, from such set aside Collections, all amounts allocated to such Tranche
Period and all Tranche Periods that ended before such date that are due in
accordance with clause (i) above. No distributions shall be made to pay amounts
under clauses (ii) - (vi) until sufficient Collections have been set aside to
pay all amounts described in clause (i) that may become payable for all
outstanding Tranche Periods. All distributions by the Agent shall be made
ratably within each priority level in accordance with the respective amounts
then due each Person included in such level unless otherwise agreed by the Agent
and the Lenders.
SECTION 3.3. NON-DISTRIBUTION OF SERVICER'S FEE. Each of the Agent and the
Secured Parties hereby consents to the retention by the Servicer of a portion of
the Percentage Share of the Collections equal to the Servicer's Fee (and, if
applicable, any invoiced expenses of such Servicer that are due and owing
pursuant to Section 8.1(d)) so long as the Collections received by the Servicer
are sufficient to pay all amounts pursuant to Section 3.2 of a higher priority
as specified in such Section.
SECTION 3.4. DEEMED COLLECTIONS. If on any day:
(a) the Unpaid Balance of any Receivable is reduced as a result of any
defective or rejected goods or services, any cash discount or any other
adjustment by any Loan Party or any Affiliate thereof, or as a result of any
tariff or other governmental or regulatory action, or
(b) the Unpaid Balance of any Receivable is reduced or canceled as a result
of a setoff in respect of any claim by the Obligor thereof (whether such claim
arises out of the same or a related or an unrelated transaction), or
(c) the Unpaid Balance of any Receivable is reduced on account of the
obligation of any Loan Party or any Affiliate thereof to pay to the related
Obligor any rebate or refund, or
(d) the Unpaid Balance of any Receivable is less than the amount included
in calculating the Net Pool Balance for purposes of any Information Package (for
any reason other than such Receivable becoming a Defaulted Receivable), or
(e) any of the representations or warranties of the Borrower set forth in
Section 6.1(j), (l) or (p) were not true when made with respect to any
Receivable, or any of the representations or warranties of the Borrower set
forth in Section 6.1(k) are no longer true with respect to any Receivable, or
any Receivable is repurchased by the Seller pursuant to the Purchase and Sale
Agreement,
then, on such day, the Borrower shall be deemed to have received a
Collection of such Receivable (1) in the case of clauses (a)-(d) above, in the
amount of such reduction or cancellation or the difference between the actual
Unpaid Balance and the amount included in calculating such Net Pool
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Balance, as applicable; and (2) in the case of clause (e) above, in the amount
of the Unpaid Balance of such Receivable.
ARTICLE IV
FEES AND YIELD PROTECTION
SECTION 4.1. FEES. The Borrower shall pay to the Agent and the Lenders
certain fees from time to time in amounts and payable on such dates as are set
forth in the Fee Letter.
SECTION 4.2. YIELD PROTECTION. If (i) a change to Regulation D or (ii) any
Regulatory Change, in either case, occurring after the date hereof:
(a) shall subject an Affected Party to any tax, duty or other charge
with respect to its Obligations or, as applicable, its Commitment or its
commitment under any Liquidity Agreement, or shall change the basis of
taxation of payments to the Affected Party of any Obligations, owed to or
funded in whole or in part by it or any other amounts due under this
Agreement in respect of its Obligations or, as applicable, its Commitment
or its commitment under any Liquidity Agreement except for (1) taxes based
on, or measured by, net income, or changes in the rate of tax on or
determined by reference to the overall net income, of such Affected Party,
(2) franchise taxes, taxes on, or in the nature of, doing business taxes or
capital taxes, or (3) withholding taxes required for payments made to any
foreign entity which, at the time such foreign entity issues its Commitment
or Liquidity Commitment or becomes an assignee of a Lender hereunder, fails
to deliver to the Agent and the Borrower an accurate IRS Form W-8 BEN or
W-8 ECI, as applicable; or
(b) shall impose, modify or deem applicable any reserve (including,
without limitation, any reserve imposed by the Federal Reserve Board, but
excluding any reserve included in the determination of interest), special
deposit or similar requirement against assets of any Affected Party,
deposits or obligations with or for the account of any Affected Party or
with or for the account of any affiliate (or entity deemed by the Federal
Reserve Board to be an affiliate) of any Affected Party, or credit extended
by any Affected Party; or
(c) shall affect the amount of capital required or expected to be
maintained by any Affected Party; or
(d) shall impose any other condition affecting any Obligation owned or
funded in whole or in part by any Affected Party, or its rights or
obligations, if any, to make Loans or Liquidity Fundings; or
(e) shall change the rate for, or the manner in which the Federal
Deposit Insurance Corporation (or a successor thereto) assesses deposit
insurance premiums or similar charges;
and the result of any of the foregoing is or would be:
(x) to increase the cost to or to impose a cost on (I) an
Affected Party funding or making or maintaining any Loan, any
Liquidity Funding, or any
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commitment of such Affected Party with respect to any of the
foregoing, or (II) any Agent for continuing its or the Borrower's
relationship with any Affected Party, in each case, in an amount
deemed to be material by such Affected Party,
(y) to reduce the amount of any sum received or receivable by an
Affected Party under this Agreement or under the Liquidity Agreement,
or
(z) to reduce the rate of return on such Affected Party's capital
as a consequence of its Commitment, its Liquidity Commitment or the
Loans made by it to a level below that which such Affected Party could
have achieved but for the occurrence of such circumstances,
then, within thirty days after demand by such Affected Party (which demand shall
be accompanied by a certificate setting forth, in reasonable detail, the basis
of such demand and the methodology for calculating, and the calculation of, the
amounts claimed by the Affected Party), the Borrower shall pay directly to such
Affected Party such additional amount or amounts as will compensate such
Affected Party for such actual additional cost, actual increased cost or actual
reduction.
(f) Each Affected Party will promptly notify the Borrower and the
Agent of any event of which it has knowledge (including any future event
that, in the judgment of such Affected Party, is reasonably certain to
occur) which will entitle such Affected Party to compensation pursuant to
this Section 4.2; PROVIDED, HOWEVER, no failure to give or delay in giving
such notification shall adversely affect the rights of any Affected Party
to such compensation.
(g) In determining any amount provided for or referred to in this
Section 4.2, an Affected Party may use any reasonable averaging and
attribution methods (consistent with its ordinary business practices) that
it (in its reasonable discretion) shall deem applicable. Any Affected Party
when making a claim under this Section 4.2 shall submit to the Borrower the
above-referenced certificate as to such actual increased cost or actual
reduced return (including calculation thereof in reasonable detail), which
statement shall, in the absence of demonstrable error, be conclusive and
binding upon the Borrower.
(h) Each of the Lenders agrees, and will require each Affected Party
to agree that, with reasonable promptness after an officer of such Lender
or such Affected Party responsible for administering the Transaction
Documents becomes aware that it has become an Affected Party under this
Section 4.2, is entitled to receive payments under this Section 4.2, or is
or has become subject to U.S. withholding taxes payable by any Loan Party
in respect of its investment hereunder, it will, to the extent not
inconsistent with any internal policy of such Person or any applicable
legal or regulatory restriction, (i) use all reasonable efforts to make,
fund or maintain its commitment or investment hereunder through another
branch or office of such Affected Party, or (ii) take such other reasonable
measures, if, as a result thereof, the circumstances which would cause such
Person to be an Affected Party under this Section 4.2 would cease to exist,
or the additional amounts which would otherwise be required to be paid to
such Person pursuant to this Section 4.2 would be reduced, or such
withholding taxes would be reduced, and if the making, funding or
maintaining of such commitment or investment through such other office or
in accordance with such other
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measures, as the case may be, would not otherwise adversely affect such
commitment or investment or the interests of such Person; provided that
such Person will not be obligated to utilize such other lending office
pursuant to this Section 4.2 unless the Borrower agrees to pay all
incremental expenses incurred by such Person as a result of utilizing such
other office as described in clause (i) above.
SECTION 4.3. FUNDING LOSSES. In the event that any Lender shall actually
incur any actual loss or expense (including any actual loss or expense incurred
by reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender to make any Loan or any Liquidity Funding, as applicable, or
maintain any Loan or Liquidity Funding, as applicable) as a result of (i) any
payment of principal with respect to such Lender's Loan being made on any day
other than the scheduled last day of an applicable CP Tranche Period or Interest
Period with respect thereto (it being understood that the foregoing shall not
apply to any Alternate Base Rate Loans), or (ii) any Loan not being made in
accordance with a request therefor under Section 2.1, then, upon written notice
from the Agent to the Borrower and the Servicer, the Borrower shall pay to the
Servicer and the Servicer shall pay to the Agent for the account of such Lender
the amount of such actual loss or expense. Such written notice (which notice
shall set forth in reasonable detail the basis to the loss or expense and shall
include the methodology for calculating, and the calculation of, the amount of
such actual loss or expense, in reasonable detail) shall, in the absence of
demonstrable error or unreasonable assumption, methodology or allocations, be
conclusive and binding upon the Borrower and the Servicer.
Notwithstanding the foregoing, unless the Agent gives notice to the
Borrower and the Servicer that it is obligated to pay an amount pursuant to this
Section 4.3 within one year after the date the Lender incurred the respective
actual loss or expense, then such Lender shall only be entitled to be
compensated for such actual loss or expense as are incurred or suffered on or
after the date which occurs one year prior to the Agent giving notice to the
Borrower and the Servicer unless such loss or expense is incurred on a
retroactive basis, in which case, such Lender shall be entitled to be
compensated for all loss and expense provided the Agent or such Lender gives
notice within one year from the date of such retroactive change. If the Borrower
pays any additional amount under this Section 4.3 to a Lender and such Lender
determines that it has actually received or realized in connection therewith any
refund or any reduction of, or credit against its tax liabilities in or with
respect to the taxable year in which the additional amount is paid (a "TAX
BENEFIT"), such Lender shall pay to the Borrower an amount that such Lender
shall determine is equal to the net benefit, after tax, which was obtained by
such Lender in such year as a consequence of such Tax Benefit; PROVIDED,
HOWEVER, that nothing in this Section 4.3 shall require any Lender to (i) seek a
Tax Benefit or (ii) disclose any confidential information to the Borrower or
Servicer (including, without limitation, its tax returns).
ARTICLE V
CONDITIONS OF ADVANCES
SECTION 5.1. CONDITIONS PRECEDENT TO INITIAL ADVANCE. The initial Advance
pursuant to this Agreement is subject to the condition precedent that the Agent
shall have received, on or before the date of such initial Advance, the
following each (unless otherwise indicated) dated such date and in form and
substance reasonably satisfactory to the Agent:
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(a) The Sale Agreement and the Purchase and Sale Agreement, duly
executed by the parties thereto;
(b) A certificate of the Secretary or Assistant Secretary or other
appropriate officer of each Loan Party certifying the names and true
signatures of the officers authorized on its behalf to sign this Agreement
and the other Transaction Documents to be delivered by it hereunder (on
which certificate the Agent and the Lenders may conclusively rely until
such time as the Agent shall receive from such Loan Party a revised
certificate meeting the requirements of this subsection (b));
(c) The Certificate of Formation or other organizational documents of
each Loan Party, duly certified by the Secretary of State of such Loan
Party's state of incorporation or organization, as of a recent date
acceptable to the Agent in each case together with a copy of the by-laws or
other organizational document of such Loan Party, duly certified by the
Secretary or an Assistant Secretary of such Loan Party or other appropriate
officer;
(d) Copies of good standing certificates or similar certificates of
existence for each Loan Party, issued by the Secretaries of State of the
state of incorporation or organization of such Loan Party and the state
where such Loan Party's principal place of business is located;
(e) Acknowledgment copies (or other evidence of filing reasonably
acceptable to the Agent) of (i) proper financing statements (Form UCC-1),
in such form as the Agent may reasonably request, naming the Originator as
debtor and seller of its Receivables and Related Assets, the Seller as the
secured party and purchaser thereof and the Agent, as agent for the Secured
Parties, as assignee, (ii) financing statements (Form UCC-1), in such form
as the Agent may reasonably request, naming the Seller as debtor and seller
of its Receivables and Related Assets, the Borrower as the secured party
and purchaser thereof and the Agent, as agent for the Secured Parties, as
assignee and (iii) financing statements (Form UCC-1), in such form as the
Agent may reasonably request, naming the Borrower as the debtor and the
Agent, as agent for the Secured Parties, as the secured party, or other,
similar instruments or documents, as may be necessary or, in the opinion of
the Agent desirable under the UCC or any comparable law of all appropriate
jurisdictions to perfect the sale by the Originator to the Seller and the
Seller to the Borrower of, and the Agent's security interest in, the
Collateral;
(f) Search reports provided in writing to the Agent (i) listing all
effective financing statements that name any Loan Party as debtor and that
are filed in the jurisdictions in which filings were made pursuant to
subsection (e) above and in such other jurisdictions that the Agent shall
reasonably request, together with copies of such financing statements (none
of which (other than any of the financing statements described in
subsection (e) above or financing statements in favor of the agent pursuant
to the Senior Credit Agreement) shall cover any Receivables or Related
Assets), and (ii) listing all tax liens and judgment liens (if any) filed
against any debtor referred to in clause (i) above in the jurisdictions
described therein and showing no such Liens;
(g) The Seller Note, duly executed by the Borrower and the Initial PCA
Note, duly executed by the Seller;
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(h) A favorable opinion of counsel to Loan Parties admitted to
practice in the State of Illinois, covering the matters set forth in
Exhibit 5.1(h);
(i) Favorable opinions of counsel to Loan Parties, as to:
(1) the existence of a "true sale" of the Receivables from the
Originator to the Seller and from the Seller to the Borrower under the
Sale Agreement and the Purchase and Sale Agreement, respectively; and
(2) the inapplicability of the doctrine of substantive
consolidation to the Borrower and the Originator and to the Borrower
and the Seller in connection with any bankruptcy proceeding involving
any Loan Party;
(j) A pro forma Information Package, prepared as of the Cut-Off Date
of October 31, 2000;
(k) A report in form and substance satisfactory to the Agent from the
Initial Due Diligence Auditor as to a pre-closing due diligence audit by
the Initial Due Diligence Auditor;
(l) The Liquidity Agreement, in form and substance satisfactory to the
Agent, duly executed by the parties thereto;
(m) With respect to the Performance Guarantor, copies of its most
recent reports on SEC Forms 10-K and 10-Q;
(n) The Fee Letter, together with payment of any and all fees due on
or prior to the date of the initial Advance;
(o) A certificate of an Authorized Officer of each of the Loan Parties
certifying that as of the date of the initial Advance, no Event of Default
or Unmatured Default exists and is continuing; and
(p) Such other agreements, instruments, certificates, opinions and
other documents as the Agent may reasonably request.
SECTION 5.2. CONDITIONS PRECEDENT TO ALL ADVANCES. Each Advance (including
the initial Advance) shall be subject to the further conditions precedent that
on the applicable Borrowing Date, each of the following statements shall be true
(and the Borrower, by accepting the amount of such Advances or by receiving the
proceeds of any Loan comprising such Advance, and each other Loan Party, upon
such acceptance or receipt by the Borrower, shall be deemed to have certified
that):
(a) the representations and warranties contained in Section 6.1 are
accurate in all material respects on and as of the date of such Advance as
though made on and as of such day and shall be deemed to have been made on
such day,
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(b) no event has occurred and is continuing, or would result from such
Advance, that constitutes an Event of Default or Unmatured Default,
(c) after giving effect to each proposed Advance, the outstanding
Loans made by Blue Ridge and the Liquidity Banks will not exceed the
Allocation Limit,
(d) the Termination Date shall not have occurred, and
(e) the Agent shall have timely received an appropriate Borrowing
Request in accordance with Section 2.1;
PROVIDED, HOWEVER, the absence of the occurrence and continuance of an Unmatured
Default shall not be a condition precedent to any Advance which does not
increase the aggregate principal amount of all Advances outstanding over the
aggregate outstanding principal balance of the Advances as of the opening of
business on such day.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.1. REPRESENTATIONS AND WARRANTIES OF THE BORROWER. The Borrower
represents and warrants, as to itself, as follows:
(a) DUE ORGANIZATION AND GOOD STANDING; OWNERSHIP OF THE BORROWER. The
Borrower is a limited liability company duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization
or formation. Performance Guarantor owns, directly or indirectly, all
outstanding membership interests of the Borrower, and all of such
membership interests are fully paid and non-assessable and free and clear
of any Liens.
(b) DUE QUALIFICATION. The Borrower is duly qualified to do business
as a limited liability company in good standing in all jurisdictions not
covered by Section 6.1(a) in which the ownership or lease of property or
the conduct of its business requires such qualification, except where the
failure to be so qualified or have such licenses or approvals would not
have a Material Adverse Effect.
(c) POWER AND AUTHORITY; DUE AUTHORIZATION. The Borrower (i) has all
necessary power, authority and legal right, and has obtained all necessary
licenses and approvals, (A) to execute and deliver this Agreement and the
other Transaction Documents to which it is a party, (B) to carry out the
terms of the Transaction Documents to which it is a party, (C) in the case
of the Servicer (or any Affiliate thereof that is acting as a
sub-servicer), to service the Receivables and the Related Assets in
accordance with this Agreement and the Purchase and Sale Agreement, and (D)
in the case of the Borrower, to grant the security interest in the
Collateral and borrow the Loans on the terms and conditions herein
provided, and (ii) has duly authorized by all necessary corporate action
the execution, delivery and performance of this Agreement and the other
Transaction Documents to which it is a party and, in the case of the
Borrower, the security interest described in clause (i)(D) above.
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(d) TITLE TO RECEIVABLES; VALID SECURITY INTEREST. Each Receivable has
been acquired by the Borrower from the Seller in accordance with the terms
of the Purchase and Sale Agreement, and the Borrower has thereby
irrevocably obtained all legal and equitable title to, and has the legal
right to sell and encumber, such Receivable and the Related Assets. Each
such Receivable has been transferred to the Borrower free and clear of any
Lien except as created hereby. Without limiting the foregoing, there have
been duly filed all financing statements or other similar instruments or
documents necessary under the UCC of all appropriate jurisdictions to
perfect the Borrower's ownership interest in such Receivable. This
Agreement creates a valid security interest in the Collateral in favor of
the Agent, for the benefit of the Secured Parties, enforceable against
creditors of and purchasers from the Borrower.
(e) NONCONTRAVENTION. The execution, delivery and performance by the
Borrower of this Agreement and each other Transaction Document to which it
is party do not and will not: (i) contravene the terms of any of its
articles of organization or by-laws or other appropriate organizational
documents; (ii) conflict with or result in a material breach or
contravention of, or the creation of any Lien under, any document
evidencing any material Contractual Obligation to which such Person is a
party or any order, injunction, writ or decree of any Governmental
Authority to which such Person or its property is subject; or (iii) violate
any Requirement of Law.
(f) NO PROCEEDINGS. There are no actions, suits, labor controversies,
proceedings, claims or disputes pending, or to the best knowledge of the
Borrower, threatened or contemplated, at law, in equity, in arbitration or
before any Governmental Authority, against the Borrower, or its
Subsidiaries or any of their respective properties which: (i) purport to
affect or pertain to this Agreement or any other Transaction Document, or
any of the transactions contemplated hereby or thereby; or (ii) if
determined adversely to the Borrower or its Subsidiaries, would reasonably
be expected to have a Material Adverse Effect. No injunction, writ,
temporary restraining order or order of any nature has been issued by any
court or other Governmental Authority purporting to enjoin or restrain the
execution, delivery or performance of this Agreement or any other
Transaction Document, or directing that the transactions provided for
herein or therein not be consummated as herein or therein provided. The
Borrower is generally subject to suit and it does not nor does any of its
properties or revenues enjoy any right of immunity from judicial
proceedings.
(g) ENFORCEABILITY. This Agreement and each other Transaction Document
signed by the Borrower constitutes, a legal, valid and binding obligation
of the Borrower, enforceable in accordance with its terms (except as
enforceability may be limited by applicable bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability).
(h) GOVERNMENT APPROVALS. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Borrower
of this Agreement or any other Transaction Document, except for (i) the
filing of the UCC financing statements referred to in Article V, and (ii)
the filing of any UCC continuation statements and amendments from time to
time required in relation to
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any UCC financing statements filed in connection with this Agreement, as
provided in Section 8.5, all of which, at the time required in Article V or
Section 8.5, as applicable, shall have been duly made and shall be in full
force and effect.
(i) NATURE OF RECEIVABLES. Each Receivable constitutes an Account.
(j) MARGIN REGULATIONS. The use of all funds obtained by the Borrower
under this Agreement or any other Transaction Document will not conflict
with or contravene any of Regulations T, U and X promulgated by the Board
of Governors of the Federal Reserve System from time to time.
(k) QUALITY OF TITLE. (i) Each Receivable, together with the Related
Assets, is owned by the Borrower free and clear of any Lien (other than any
Lien arising solely as the result of any action taken by the Agent or one
of the Secured Parties); (ii) the Agent, on behalf of the Secured Parties,
has a valid and perfected first priority security interest in the
Collateral; and (iii) no financing statement or other instrument similar in
effect covering any portion of the Collateral is on file in any recording
office except such as may be filed (A) in favor of the Originator in
accordance with the Contracts, (B) in favor of the Seller in accordance
with the Sale Agreement (C) in favor of the Borrower and its assigns in
connection with the Purchase and Sale Agreement, (D) in favor of the Agent
in accordance with this Agreement or in connection with any Lien arising
solely as the result of any action taken by the Agent or one of the Secured
Parties or (E) in favor of the agent pursuant to the Senior Credit
Agreement.
(l) ACCURATE REPORTS. No Information Package (if prepared by the
Borrower, or to the extent information therein was supplied by the
Borrower), no other information furnished verbally or in writing prior to
the date of this Agreement, and no other information, exhibit, financial
statement, document, book, record or report furnished or to be furnished in
writing after the date of this Agreement, by or on behalf of the Borrower
to the Agent or any of the Lenders pursuant to this Agreement was or will
be inaccurate in any material respect as of the date it was or will be
dated or (except as otherwise disclosed to the Agent or the Lenders at such
time) as of the date so furnished, or contained or (in the case of
information or other materials to be furnished in the future) will contain
any material misstatement of fact or omitted or (in the case of information
or other materials to be furnished in the future) will omit to state a
material fact or any fact necessary to make the statements contained
therein not materially misleading in light of the circumstances made or
presented.
(m) OFFICES. The principal places of business and chief executive
offices of the Servicer and the Borrower are located at the respective
addresses set forth on Schedule 14.2, and the offices where the books,
records and documents evidencing the Receivables, the related Contracts and
all purchase orders and other agreements related to such Receivables are
located are specified in Schedule 6.1(m) (or at such other locations,
notified to the Agent in accordance with Section 7.1(f), in jurisdictions
where all action required by Section 8.5 has been taken and completed).
(n) LOCK-BOX ACCOUNTS. The names and addresses of all the Lock-Box
Banks, together with the account numbers of the accounts of the Borrower at
such Lock-Box Banks,
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are specified in Schedule 6.1(n) (or have been notified to and approved by
the Agent in accordance with Section 7.3(d)). Each of the Lock-Box Accounts
is subject to a Lock-Box Agreement that is in full force and effect.
(o) ELIGIBLE RECEIVABLES. Each Receivable included as an Eligible
Receivable in the Net Pool Balance in connection with any computation or
recomputation of the Borrowing Base is an Eligible Receivable on such date.
(p) NAMES. In the past five years, the Borrower has not used any
corporate names, trade names or assumed names other than the name in which
it has executed this Agreement.
(q) CREDIT AND COLLECTION POLICY. With respect to each Receivable,
each of the Originator, the Borrower and the Servicer has complied in all
material respects with the applicable Credit and Collection Policy, and no
change has been made to such Credit and Collection Policy since the date of
this Agreement which would be reasonably likely to materially and adversely
affect the collectibility of the Receivables or decrease the credit quality
of any newly created Receivables except for such changes as to which each
of the Agent have received the notice required under Section 7.2(g) and, to
the extent that such change is material, has given its prior written
consent thereto (which consent shall not be unreasonably withheld or
delayed).
(r) PAYMENTS TO SELLER. With respect to each Receivable sold to the
Borrower by the Seller, the Borrower has given reasonably equivalent value
to the Seller in consideration for such Receivable and the Related Assets
with respect thereto under the Purchase and Sale Agreement and such
transfer was not made for or on account of an antecedent debt. No transfer
by the Seller of any Receivable is or may be voidable under any Section of
the Bankruptcy Reform Act of 1978 (11 U.S.C. Sections 101 et seq.), as
amended.
(s) NOT AN INVESTMENT COMPANY. The Borrower is not an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended from time to time, or any successor statute.
(t) BORROWING BASE. As of each Borrowing Date, after giving effect to
the Loans to be made on such date, the Borrowing Base is at least equal to
the aggregate outstanding principal balance of the Advances.
ARTICLE VII
GENERAL COVENANTS OF THE BORROWER
SECTION 7.1. AFFIRMATIVE COVENANTS OF THE BORROWER. From the date hereof
until the Final Payout Date, unless the Agent shall otherwise consent in
writing:
(a) COMPLIANCE WITH LAWS, Etc. The Borrower will comply in all
material respects with all applicable laws, rules, regulations and orders,
including those with respect to the Receivables and related Contracts,
except where the failure to so comply would not individually or in the
aggregate have a Material Adverse Effect.
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(b) PRESERVATION OF CORPORATE EXISTENCE. The Borrower will preserve
and maintain its limited liability existence, rights, franchises and
privileges in the jurisdiction of its organization, and qualify and remain
qualified in good standing as a limited liability company in each
jurisdiction where the failure to preserve and maintain such existence,
rights, franchises, privileges and qualification would have a Material
Adverse Effect.
(c) AUDITS. The Borrower will (i) at any time and from time to time
upon not less than ten (10) Business Days' notice (unless an Event of
Default has occurred and is continuing, in which case no such notice shall
be required) during regular business hours, permit the Agent or any of its
agents or representatives: (A) to examine and make copies of and abstracts
from all books, records and documents (including, without limitation,
computer tapes and disks) in the possession or under the control of or
accessible to the Borrower relating to Receivables, including, without
limitation, the related Contracts and purchase orders and other agreements,
and (B) to visit the offices and properties of the Borrower for the purpose
of examining such materials described in clause (i) (A) next above, and to
discuss matters relating to Receivables or the Borrower's performance
hereunder with any of the officers or employees of the Borrower having
knowledge of such matters; and (ii) without limiting the provisions of
clause (i) above, from time to time upon not less than ten (10) Business
Days notice, at the expense of the Borrower, permit Performance Guarantor's
outside auditors (except as hereinafter provided) or other certified public
accountants or auditors acceptable to the Agent to conduct a review of the
Borrower's books and records with respect to the Receivables and Related
Assets (each of the reviews described in clause (i) and (ii) hereof, a
"REVIEW"); PROVIDED, HOWEVER, that, so long as no Event of Default has
occurred and is continuing, (i) the Borrower shall only be responsible for
the costs and expenses of one such Review under this Section or under
Section 7.2(h) in any one calendar year and (ii) there shall be no more
than two such Reviews under this Section or under Section 7.2(h) in any one
calendar year.
(d) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. The Servicer will
maintain and implement administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing Receivables
in the event of the destruction of the originals thereof), and keep and
maintain, all documents, books, records and other information reasonably
necessary or advisable for the collection of all Receivables (including,
without limitation, records adequate to permit the daily identification of
outstanding Unpaid Balances by Obligor and related debit and credit details
of the Receivables).
(e) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS. The
Borrower will, at its expense, timely and fully perform and comply with all
material provisions, covenants and other promises, if any, required to be
observed by it under the Contracts related to the Receivables and all
agreements related to such Receivables.
(f) LOCATION OF CHIEF EXECUTIVE OFFICE. The Borrower will keep its
chief place of business and chief executive office, and the offices where
records concerning the Receivables and all related Contracts are kept (and
all original documents relating thereto), at the address(es) referred to in
Section 6.1(n) or, upon 15 days' prior written notice to the Agent, at such
other locations in jurisdictions where all action required by Section 8.5
shall have been taken and completed.
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(g) CREDIT AND COLLECTION POLICIES. The Borrower will comply in all
material respects with the Credit and Collection Policy in regard to each
Receivable and the related Contracts.
(h) PURCHASE AND SALE AGREEMENT. The Borrower will perform and comply
in all material respects with all of its covenants and agreements set forth
in the Purchase and Sale Agreement, and will enforce the performance by the
Seller of its obligations under the Purchase and Sale Agreement.
(i) COLLECTIONS. All Obligors shall be instructed to make payments on
Receivables directly to a Lock-Box Account which is the subject of a
Lock-Box Agreement. If, notwithstanding the foregoing, any Collections are
paid directly to the Borrower, the Borrower shall deposit the same (with
any necessary endorsements) to such a Lock-Box Account within two (2)
Business Days after receipt thereof. Upon demand of the Agent to the extent
that the Agent reasonably determines necessary in order to protect the
interests of the Agent or the Secured Parties under this Agreement, the
Borrower or the Servicer shall establish a segregated account at Wachovia
Bank, N.A. which is subject to a perfected security interest in favor of
the Agent, for the benefit of the Secured Parties (the "COLLECTION
ACCOUNT"), into which all deposits from time to time in Lock-Box Accounts,
and all other Collections, are concentrated pending application in
accordance with the terms of this Agreement to the Obligations.
(j) FURTHER ASSURANCES. The Borrower shall take all necessary action
to establish and maintain (i) in favor of the Borrower, a valid and
perfected ownership interest in the Receivables and Related Assets (other
than books and records evidencing or otherwise relating to any
Receivables), and (ii) in favor of the Agent for the benefit of the Secured
Parties, a valid and perfected first priority security interest in the
Receivables and the Related Assets (other than books and records evidencing
or otherwise relating to any Receivables), including, without limitation,
taking such action to perfect, protect or more fully evidence the interest
of the Agent as the Agent may reasonably request.
SECTION 7.2. REPORTING REQUIREMENTS OF THE BORROWER. From the date hereof
until the Final Payout Date, unless the Agent shall otherwise consent in
writing:
(a) QUARTERLY FINANCIAL STATEMENTS. (i) The Borrower will cause the
Performance Guarantor to furnish to the Agent as soon as available and in
any event within 50 days after the end of each of the first three quarters
of each fiscal year of Performance Guarantor, copies of its consolidated
balance sheets and related statements of income and statements of cash
flow, showing the financial condition of Performance Guarantor and its
consolidated Subsidiaries as of the close of such fiscal quarter and the
results of its operations and the operations of such Subsidiaries during
such fiscal quarter and the then elapsed portion of the fiscal year,
together with a Certificate of Financial Officer in the form attached
hereto as Exhibit 7.2 executed by the chief financial officer or treasurer
of Performance Guarantor; and (ii) the Borrower will furnish to the Agent,
as soon as available and in any event within 50 days after the end of each
of the first three quarters of each fiscal year of the Borrower, copies of
the financial statements of the Borrower, consisting of at least a balance
sheet as at the close of such quarter and statements of earnings and
changes in cash flows for such
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quarter and for the period from the beginning of the fiscal year to the
close of such quarter, together with a Certificate of Financial Officer in
the form attached hereto as Exhibit 7.2 executed by the chief financial
officer or treasurer of the Borrower;
(b) ANNUAL FINANCIAL STATEMENTS. (i) The Borrower will cause the
Performance Guarantor to furnish to the Agent, as soon as available and in
any event within 90 days after the end of each fiscal year of Performance
Guarantor, copies of its consolidated balance sheets and related statements
of income and statements of cash flow, showing the financial condition of
Performance Guarantor and its consolidated Subsidiaries as of the close of
such fiscal year and the results of its operations and the operations of
such Subsidiaries during such year, all audited by independent public
accountants of recognized national standing acceptable to the Agent and
accompanied by an opinion of such accountants (which shall not be qualified
in any material respect with respect to any matter related to the
Receivables or the collectability of the Receivables) to the effect that
such consolidated financial statements fairly present the financial
condition and results of operations of Performance Guarantor on a
consolidated basis (except as noted therein) in accordance with GAAP
consistently applied; and (ii) the Borrower will furnish to the Agent, as
soon as available and in any event within 90 days after the end of each
fiscal year of the Borrower, copies of the financial statements of the
Borrower, consisting of at least a balance sheet of Borrower for such year
and statements of earnings, cash flows and shareholders' equity, setting
forth in each case in comparative form corresponding figures from the
preceding fiscal year, together with a Certificate of Financial Officer in
the form attached hereto as Exhibit 7.2 executed by the chief financial
officer or treasurer of the Borrower;
(c) REPORTS TO SEC AND EXCHANGES. In addition to the reports required
by subsections (a) and (b) next above, promptly upon the Agent's reasonable
request, the Borrower will cause the Performance Guarantor to furnish to
the Agent copies of any reports or registration statements that Performance
Guarantor files with the Securities and Exchange Commission or any national
securities exchange other than registration statements relating to employee
benefit plans and to registrations of securities for selling
securityholders;
(d) ERISA. Promptly after the filing or receiving thereof, the
Borrower will furnish to the Agent copies of all reports and notices with
respect to any Reportable Event defined in Article IV of ERISA which the
Borrower files under ERISA with the Internal Revenue Service, the Pension
Benefit Guaranty Corporation or the U.S. Department of Labor or which the
Borrower receives from the Pension Benefit Guaranty Corporation;
(e) EVENTS OF DEFAULT, ETC. As soon as possible and in any event
within five (5) Business Days after any Responsible Officer of the Borrower
obtains knowledge of the occurrence of any Event of Default or any
Unmatured Default, the Borrower will furnish to the Agent a written
statement of a Responsible Officer of the Borrower setting forth details of
such event and the action that the Borrower will take with respect thereto;
(f) LITIGATION. As soon as possible and in any event within ten
Business Days after any Responsible Officer of the Borrower obtains
knowledge thereof, the Borrower will furnish to the Agent notice of (i) any
litigation, investigation or proceeding which may exist at any time which
would reasonably be expected to have a Material Adverse Effect and (ii)
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any development in previously disclosed litigation which development would
reasonably be expected to have a Material Adverse Effect;
(g) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. The Borrower
will furnish to the Agent prompt written notice of any material change in
the character of the Borrower's business prior to the occurrence of such
change, and the Borrower will provide the Agent with not less than 15
Business Days' prior written notice of any material change in the Credit
and Collection Policy (together with a copy of such proposed change); and
(h) OTHER. Promptly, from time to time, the Borrower will furnish to
the Agent such other information, documents, records or reports respecting
the Receivables (including all Records) or the condition or operations,
financial or otherwise, of the Borrower as the Agent may from time to time
reasonably request in order to protect the interests of the Agent or the
Secured Parties under or as contemplated by this Agreement.
Notwithstanding anything herein to the contrary, as long as the Agent is a
party to the Senior Credit Agreement, the Borrower shall be deemed to be in
compliance with Section 7.2(a)(i), 7.2(b)(i) and 7.2(c) to the extent the
Performance Guarantor is in compliance with Section 8.01 of the Senior Credit
Agreement.
SECTION 7.3. NEGATIVE COVENANTS OF THE BORROWER. From the date hereof until
the Final Payout Date, without the prior written consent of the Agent:
(a) SALES, LIENS, ETC. (i) The Borrower will not, except as otherwise
provided herein and in the other Transaction Documents, sell, assign (by
operation of law or otherwise) or otherwise dispose of, or create or suffer
to exist any Lien upon or with respect to, any Collateral, or any account
to which any Collections are sent, or any right to receive income or
proceeds from or in respect of any of the foregoing (except, prior to the
execution of Lock-Box Agreements, set-off rights of any bank at which any
such account is maintained), and (ii) the Servicer will not assert any
interest in the Receivables, except as the Servicer.
(b) EXTENSION OR AMENDMENT OF RECEIVABLES. The Borrower will not,
except as otherwise permitted in Section 8.2(c), extend, amend or otherwise
modify the terms of any Receivable, or amend, modify or waive any material
term or condition of any Contract related thereto in any way that
materially adversely affects the collectibility of any Receivable or any
Lender's rights therein.
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. The Borrower
will not make or permit to be made 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 significant portion of the
Receivables or otherwise materially and adversely affect the interests or
remedies of each Lender under this Agreement or any other Transaction
Document.
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS. The Borrower will not
add or terminate any bank as a Lock-Box Bank from those listed in Schedule
6.1(o) or, after the
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Collection Account has been established pursuant to Section 7.1(i), make
any material change in its instructions to Obligors regarding payments to
be made to the Borrower or the Servicer or payments to be made to any
Lock-Box Bank (which shall not include a change in instructions solely for
the purpose of directing Obligors to make such payments to another existing
Lock-Box Bank), unless (i) the Agent shall have received prior written
notice of such addition, termination or change and (ii) the Agent shall
have received duly executed copies of Lock-Box Agreements in a form
reasonably acceptable to the Agent with each new Lock-Box Bank.
(e) DEPOSITS TO LOCK-BOX ACCOUNTS AND COLLECTION ACCOUNT. The Borrower
will not deposit or otherwise credit, or cause or permit to be so deposited
or credited, to any Lock-Box Account or the Collection Account, any cash or
cash proceeds other than Collections of Receivables.
(f) CHANGES TO OTHER DOCUMENTS. The Borrower will not, without the
consent of the Agent, enter into any amendment or modification of, or
supplement to, the Purchase and Sale Agreement, the Seller Note or the
Borrower's Certificate of Formation or such other equivalent certificate.
(g) RESTRICTED PAYMENTS BY THE BORROWER. The Borrower will not:
(i) declare or pay any distributions in respect of any membership
or other equity interest in the Borrower or set aside any funds for
any such purpose, unless, in each of the foregoing cases: (A) such
distribution is made on, or immediately following, a Settlement Date
after payment of all Obligations due and owing on such Settlement
Date, and (B) after giving effect to such distribution, the Borrower's
net worth (determined in accordance with GAAP) will be at least
$20,000,000; or
(ii) Make any payment of principal or interest on the Seller Note
if any Event of Default exists or would result therefrom or if such
payment would result in the Borrower's having insufficient cash on
hand to pay all Obligations that will be due and owing on the next
succeeding Settlement Date.
(h) BORROWER INDEBTEDNESS. The Borrower will not incur or permit to
exist any Indebtedness or liability on account of deposits except: (A)
current accounts payable arising in the ordinary course of business and not
overdue in an aggregate amount at any time outstanding not to exceed
$50,000 (B) Indebtedness incurred in accordance with the Purchase and Sale
Agreement and evidenced by the Seller Note and (C) current payables not
mentioned in Clause (A) of this subsection (h) and expense reimbursement
obligations arising under the Transaction Documents and not overdue.
(i) PROHIBITION ON ADDITIONAL NEGATIVE PLEDGES. The Borrower will not
enter into or assume any agreement (other than this Agreement and the other
Transaction Documents) prohibiting the creation or assumption of any Lien
upon any Receivables or Related Assets, whether now owned or hereafter
acquired, except as contemplated by the Transaction Documents, or otherwise
prohibiting or restricting any transaction contemplated hereby or by the
other Transaction Documents, and the Borrower will not enter into or assume
any
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agreement creating any Lien upon the Seller Note, except as required by the
Senior Credit Agreement.
(j) NAME CHANGE, OFFICES. The Borrower will not change its name,
identity or corporate structure (within the meaning of Section 9-402(7) of
any applicable enactment of the UCC) or relocate its chief executive office
unless it shall have: (i) given the Agent at least 15 Business Days' prior
written notice thereof and (ii) prior to effectiveness of such change,
delivered to the Agent all financing statements, instruments and other
documents requested by the Agent in connection with such change or
relocation.
(k) MERGERS, CONSOLIDATIONS AND ACQUISITIONS. The Borrower will not
merge into or consolidate with any other Person, or permit any other Person
to merge into or consolidate with it, or purchase, lease or otherwise
acquire (in one transaction or a series of transactions) all or
substantially all of the assets of any other Person (whether directly by
purchase, lease or other acquisition of all or substantially all of the
assets of such Person or indirectly by purchase or other acquisition of all
or substantially all of the capital stock of such other Person) other than
the acquisition of the Receivables and Related Assets pursuant to the
Purchase and Sale Agreement.
(l) DISPOSITION OF RECEIVABLES AND RELATED ASSETS. Except pursuant to
this Agreement, the Borrower will not sell, lease, transfer, assign or
otherwise dispose of (in one transaction or in a series of transactions)
any Receivables and Related Assets.
(m) BORROWING BASE. The Borrower will not request any Advance if,
after giving effect thereto, the aggregate outstanding principal balance of
the Loans would exceed the Borrowing Base.
SECTION 7.4. SEPARATE CORPORATE EXISTENCE OF THE BORROWER. The Borrower
hereby acknowledges that the Lenders and the Agent are entering into the
transactions contemplated hereby in reliance upon the Borrower's identity as a
legal entity separate from the Servicer and its other Affiliates. Therefore, the
Borrower shall take all steps specifically required by this Agreement or
reasonably required by the Agent to continue the Borrower's identity as a
separate legal entity and to make it apparent to third Persons that the Borrower
is an entity with assets and liabilities distinct from those of its Affiliates,
and is not a division of Performance Guarantor or any other Person. Without
limiting the foregoing, the Borrower will take such actions as shall be required
in order that:
(a) The Borrower will be a limited purpose company whose primary
activities are restricted in its Certificate of Formation or other
equivalent certificate to purchasing or otherwise acquiring from Seller,
owning, holding, granting security interests in the Collateral, entering
into agreements for the financing and servicing of the Receivables, and
conducting such other activities as it deems necessary or appropriate to
carry out its primary activities;
(b) Not less than one member of the Borrower's Board of Managers (the
"INDEPENDENT MANAGER") shall be an individual who is not, and never has
been, a direct, indirect or beneficial stockholder (other than through a
mutual fund the investment decisions of which are not controlled by such
person), officer, director, employee, affiliate, associate, material
supplier or material customer of Performance Guarantor or any of its
Affiliates
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(other than an Affiliate organized with a limited purpose charter for the
purpose of acquiring receivables or other financial assets or intangible
property). The certificate of formation or other equivalent certificate of
the Borrower shall provide that (a) at least one member of the Borrower's
Board of Managers or other similar governing body shall be an Independent
Manager, (b) the Borrower's Board of Managers or other similar governing
body shall not approve, or take any other action to cause the filing of, a
voluntary bankruptcy petition with respect to the Borrower unless the
Independent Manager shall approve the taking of such action in writing
prior to the taking of such action and (c) the provisions requiring an
independent director and the provision described in clauses (a) and (b) of
this paragraph (ii) cannot be amended without the prior written consent of
the Independent Manager;
(c) The Independent Manager shall not at any time serve as a trustee
in bankruptcy for the Borrower or any Affiliate thereof;
(d) Any director, employee, consultant or agent of the Borrower will
be compensated from the Borrower's funds for services provided to the
Borrower. The Borrower will not engage any agents other than its attorneys,
auditors and other professionals and a servicer (which servicer will be
fully compensated for its services by payment of the Servicer's Fee) and
any other agent contemplated by the Transaction Documents for the
Collateral;
(e) The Borrower will contract with the Servicer to perform for the
Borrower all operations required on a daily basis to service the
Collateral. The Borrower will pay the Servicer the Servicer's Fee pursuant
hereto. The Borrower will not incur any material indirect or overhead
expenses for items shared with Performance Guarantor (or any other
Affiliate thereof) which are not reflected in the Servicer's Fee. To the
extent, if any, that the Borrower (or any other Affiliate thereof) shares
items of expenses not reflected in the Servicer's Fee, for legal, auditing
and other professional services and directors' fees, such expenses will be
allocated to the extent practical on the basis of actual use or the value
of services rendered, and otherwise on a basis reasonably related to the
actual use or the value of services rendered, it being understood that
Performance Guarantor shall pay all expenses relating to the preparation,
negotiation, execution and delivery of the Transaction Documents,
including, without limitation, legal, rating agency and other fees;
(f) The Borrower's operating expenses will not be paid by any other
Loan Party or other Affiliate of the Borrower;
(g) The Borrower will have its own stationery;
(h) The books of account, financial reports and corporate records of
the Borrower will be maintained separately from those of Performance
Guarantor and each other Affiliate of the Borrower;
(i) Any financial statements of any Loan Party or Affiliate thereof
which are consolidated to include the Borrower will contain detailed notes
clearly stating that (A) all of the Borrower's assets are owned by the
Borrower, and (B) the Borrower is a separate corporate entity with its own
separate creditors that will be entitled to be satisfied out of the
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Borrower's assets prior to any value in the Borrower becoming available to
the Borrower's equity holders; and the accounting records and the published
financial statements of the Seller will clearly show that, for accounting
purposes, the Receivables and Related Assets have been sold by the Seller
to the Borrower;
(j) The Borrower's assets will be maintained in a manner that
facilitates their identification and segregation from those of the Servicer
and the other Affiliates;
(k) Each Affiliate of the Borrower will strictly observe corporate
formalities in its dealings with the Borrower, and, except as permitted
pursuant to this Agreement with respect to Collections, funds or other
assets of the Borrower will not be commingled with those of any of its
Affiliates;
(l) No Affiliate of the Borrower will maintain joint bank accounts
with the Borrower or other depository accounts with the Borrower to which
any such Affiliate (other than in the Borrower's or such Affiliate's
existing or future capacity as the Servicer hereunder or under the Purchase
and Sale Agreement) has independent access, provided that prior to demand
by the Agent pursuant to Section 7.1(i) to establish a segregated
Collection Account, Collections may be deposited into general accounts of
Performance Guarantor, subject to the obligations of the Servicer
hereunder;
(m) No Affiliate of the Borrower shall, directly or indirectly, name
the Borrower or enter into any agreement to name the Borrower as a direct
or contingent beneficiary or loss payee on any insurance policy covering
the property of any Affiliate of the Borrower;
(n) Each Affiliate of the Borrower will maintain arm's length
relationships with the Borrower, and each Affiliate of the Borrower that
renders or otherwise furnishes services or merchandise to the Borrower will
be compensated by the Borrower at market rates for such services or
merchandise;
(o) No Affiliate of the Borrower will be, nor will it hold itself out
to be, responsible for the debts of the Borrower or the decisions or
actions in respect of the daily business and affairs of the Borrower.
Packaging Corporation of America and the Borrower will immediately correct
any known misrepresentation with respect to the foregoing and they will not
operate or purport to operate as an integrated single economic unit with
respect to each other or in their dealing with any other entity;
(p) The Borrower will keep correct and complete books and records of
account and minutes of the meetings and other proceedings of its
stockholder and board of directors, as applicable, and the resolutions,
agreements and other instruments of the Borrower will be continuously
maintained as official records by the Borrower; and
(q) Each of the Borrower, on the one hand, and the Seller and the
Originator, on the other hand, will conduct its business solely in its own
corporate name and in such a separate manner so as not to mislead others
with whom they are dealing.
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ARTICLE VIII
ADMINISTRATION AND COLLECTION
SECTION 8.1. DESIGNATION OF SERVICER. (a) SELLER AS INITIAL SERVICER. The
servicing, administering and collection of the Receivables shall be conducted by
the Person designated as Servicer hereunder from time to time in accordance with
this Section 8.1. Until the Agent gives to Seller a Successor Notice (as defined
in Section 8.1(b)), Seller is hereby designated as, and hereby agrees to perform
the duties and obligations of, Servicer pursuant to the terms hereof.
(b) SUCCESSOR NOTICE; SERVICER TRANSFER EVENTS. Upon Seller's receipt of a
notice from the Agent following a Servicer Transfer Event of the designation of
a new Servicer (a "SUCCESSOR NOTICE"), Seller agrees that it will terminate its
activities as Servicer hereunder in a manner that will facilitate the transition
of the performance of such activities to the new Servicer, and the Agent (or the
designee of the Agent) shall assume each and all of Seller's obligations to
service and administer such Receivables, on the terms and subject to the
conditions herein set forth, and Seller shall use its reasonable best efforts to
assist the Agent (or the Agent's designee) in assuming such obligations. Without
limiting the foregoing, Seller agrees, at its expense, to take all actions
necessary to provide the new Servicer with access to all computer software
necessary to generate reports useful in collecting or billing Receivables,
solely for use in collecting and billing Receivables. If Seller disputes the
occurrence of a Servicer Transfer Event, Seller may take appropriate action to
resolve such dispute; provided that Seller must terminate its activities
hereunder as Servicer and allow the newly designated Servicer to perform such
activities on the date specified by the Agent as described above,
notwithstanding the commencement or continuation of any proceeding to resolve
the aforementioned dispute, if the Agent reasonably determine, in good faith,
that such termination is necessary or advisable to protect the Secured Parties'
interests hereunder.
(c) SUBCONTRACTS. So long as Seller is acting as the Servicer, it may
subcontract with the Originator for servicing, administering or collecting all
or any portion of the Receivables, PROVIDED, HOWEVER, that no such subcontract
shall relieve Seller of its primary liability for performance of its duties as
Servicer pursuant to the terms hereof and any such subservicing arrangement may
be terminated at the request of the Agent at any time after a Successor Notice
has been given. In addition to the foregoing, with the prior written consent of
the Agent (which consent shall not be unreasonably withheld or delayed), any
Servicer may subcontract with other Persons for servicing, administering or
collecting all or any portion of the Receivables, provided, however, that no
such subcontract shall relieve such Servicer of its primary liability for
performance of its duties as Servicer pursuant to the terms hereof and any such
subservicing arrangement may be terminated at the request of the Agent at any
time that such Agent reasonably determines that such subservicer is not
performing adequately.
(d) EXPENSE INDEMNITY AFTER A SERVICER TRANSFER EVENT. In addition to, and
not in lieu of the Servicer's Fee, if Seller or one of its Affiliates is
replaced as Servicer following a Servicer Transfer Event, the Borrower shall
reimburse the Servicer within 10 Business Days after receipt of a written
invoice, any and all reasonable costs and expenses (based on then current market
prices) of the Servicer incurred in connection with its servicing of the
Receivables for the benefit of the Secured Parties.
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SECTION 8.2. DUTIES OF SERVICER.
(a) APPOINTMENT; DUTIES IN GENERAL. Each of the Borrower, the Lenders and
the Agent hereby appoints as its agent, the Servicer, as from time to time
designated pursuant to Section 8.1, to enforce its rights and interests in and
under the Receivables, the Related Security and the related Contracts. The
Servicer shall take or cause to be taken all such actions as may be necessary or
advisable to collect each Receivable from time to time, all in accordance with
applicable laws, rules and regulations, with reasonable care and diligence, and
in accordance with the Credit and Collection Policy.
(b) SEGREGATION OF COLLECTIONS. The Servicer shall not be required (unless
otherwise requested by the Agent) to segregate the funds constituting the
Collections prior to the remittance thereof in accordance with Article III. If
the Agent determines in its reasonable judgment that it is necessary or
desirable and so instructs the Servicer, the Servicer shall segregate and
deposit into the Collection Account Collections not later than the second
Business Day following receipt by the Servicer of such Collections in
immediately available funds.
(c) MODIFICATION OF RECEIVABLES. Seller, while it is the Servicer, may, in
accordance with the Credit and Collection Policy, so long as no Event of Default
and no Unmatured Default shall have occurred and be continuing, extend the
maturity as Seller may reasonably determine to be appropriate to maximize
Collections thereof or adjust the Unpaid Balance of any Receivable in a manner
consistent with the Credit and Collection Policy (although no such extension or
adjustment shall alter the status of such Receivable as a Defaulted Receivable
or a Delinquent Receivable or, in the case of an adjustment, limit the rights of
the Agent or the Lenders under Section 3.4).
(d) DOCUMENTS AND RECORDS. The Borrower shall deliver to the Servicer, and
the Servicer shall hold in trust for the Borrower and the Secured Parties, all
documents, instruments and records (including, without limitation, computer
tapes or disks) that evidence or relate to Receivables.
(e) CERTAIN DUTIES TO THE BORROWER. The Servicer shall, as soon as
practicable following receipt, turn over to the Borrower (i) that portion of the
Collections which are not required to be turned over to the Agent, less the
Servicer's Fee, and, in the event that neither Seller nor any other Loan Party
or Affiliate thereof is the Servicer, all reasonable and appropriate
out-of-pocket costs and expenses of the Servicer of servicing, collecting and
administering the Receivables to the extent not covered by the Servicer's Fee
received by it, and (ii) the Collections of any receivable which is not a
Receivable. The Servicer, if other than Seller or any other Loan Party or
Affiliate thereof, shall, as soon as practicable upon demand, deliver to the
Borrower all documents, instruments and records in its possession that evidence
or relate to Receivables of the Borrower, and copies of documents, instruments
and records in its possession that evidence or relate to Receivables.
(f) TERMINATION. The Servicer's authorization under this Agreement shall
terminate upon the Final Payout Date.
(g) POWER OF ATTORNEY. The Borrower hereby grants to the Servicer an
irrevocable power of attorney, with full power of substitution, coupled with an
interest, to take in the name of the Borrower all steps which are necessary or
advisable to endorse, negotiate or otherwise realize on any
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writing or other right of any kind held or transmitted by the Borrower or
transmitted or received by Lender (whether or not from the Borrower) in
connection with any Receivable.
SECTION 8.3. RIGHTS OF THE AGENT.
(a) NOTICE TO OBLIGORS. At any time when an Unmatured Default or Event of
Default has occurred and is continuing, the Agent may notify the Obligors of
Receivables, or any of them, of its security interest, for the benefit of the
Secured Parties, in the Collateral.
(b) NOTICE TO LOCK-BOX BANKS. At any time after the occurrence of an
Unmatured Default or an Event of Default, the Agent is hereby authorized to
direct the Servicer, and the Servicer is hereby authorized and directed to
comply with such direction, to give notice to the Lock-Box Banks, as provided in
the Lock-Box Agreements, of the transfer to the Agent of dominion and control
over the Lock-Boxes and related Lock-Box Accounts to which the Obligors of
Receivables make payments. The Borrower and the Servicer hereby transfer to the
Agent, effective when the Agent shall give notice to the Lock-Box Banks as
provided in the Lock-Box Agreements, the exclusive dominion and control over
such Lock-Boxes and Lock-Box Accounts, and shall take any further action that
the Agent may reasonably request to effect such transfer.
(c) RIGHTS ON SERVICER TRANSFER EVENT. At any time following the
designation of a Servicer other than Initial Servicer pursuant to Section 8.1:
(i) The Agent may direct the Obligors of Receivables, or any of them,
to pay all amounts payable under any Receivable directly to the Agent or
its designee.
(ii) The Borrower shall, at the Agent's request and at the Borrower's
expense, give notice of the Agent's security interest in the Collateral to
each Obligor of Receivables and direct that payments be made directly to
the Agent or its designee.
(iii) The Borrower shall, at the Agent's request: (A) assemble all of
the documents, instruments and other records (including, without
limitation, computer programs, tapes and disks) which evidence the
Collateral, or which are otherwise necessary or desirable to collect the
Collateral, and make the same available to the successor Servicer at a
place selected by the Agent, and (B) segregate all cash, checks and other
instruments received by it from time to time constituting Collections in a
manner acceptable to the Agent and promptly upon receipt, remit all such
cash, checks and instruments, duly endorsed or with duly executed
instruments of transfer, to the successor Servicer.
(iv) The Borrower and the Lenders hereby authorize the Agent and grant
to the Agent an irrevocable power of attorney (which shall terminate on the
Final Payout Date), to take any and all steps in such Person's name and on
behalf of such Person which are necessary or desirable, in the
determination of the Agent, to collect all amounts due under any and all
Receivables, including, without limitation, endorsing the Borrower's name
on checks and other instruments representing Collections and enforcing such
Receivables and the related Contracts.
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SECTION 8.4. RESPONSIBILITIES OF THE BORROWER. Anything herein to the
contrary notwithstanding:
(a) CONTRACTS. The Borrower shall remain responsible for performing all of
its obligations (if any) under the Contracts related to the Receivables and
under the related agreements to the same extent as if the security interest in
the Collateral had not been granted hereunder, and the exercise by the Agent or
its designee of its rights hereunder shall not relieve the Borrower from such
obligations.
(b) LIMITATION OF LIABILITY. The Agent and the Lenders shall not have any
obligation or liability with respect to any Receivables, Contracts related
thereto or any other related agreements, nor shall any of them be obligated to
perform any of the obligations of the Borrower or the Seller thereunder.
SECTION 8.5. FURTHER ACTION EVIDENCING THE SECURITY INTEREST.
(a) FURTHER ASSURANCES. The Borrower agrees that from time to time, at its
expense, it will promptly execute and deliver all further instruments and
documents, and take all further action that the Agent or its designee may
reasonably request in order to perfect, protect or more fully evidence the
Agent's security interest, on behalf of the Secured Parties, in the Collateral,
or to enable the Agent or its designee to exercise or enforce any of the Secured
Parties' respective rights hereunder or under any Transaction Document in
respect thereof. Without limiting the generality of the foregoing, the Borrower
will:
(i) upon the request of the Agent, execute and file such financing or
continuation statements, or amendments thereto or assignments thereof, and
such other instruments or notices, as may be necessary or appropriate, in
accordance with the terms of this Agreement;
(ii) upon the request of the Agent after the occurrence and during the
continuance of an Event of Default, ▇▇▇▇ conspicuously each Contract
evidencing each Receivable constituting chattel paper with a legend,
acceptable to the Agent, evidencing its security interest therein pursuant
to this Agreement; and
(iii) ▇▇▇▇ its master data processing records evidencing the
Collateral with a legend, acceptable to the Agent, evidencing that a
security interest in the Collateral has been granted pursuant to this
Agreement.
(b) ADDITIONAL FINANCING STATEMENTS; CONTINUATION STATEMENTS; PERFORMANCE
BY AGENT. The Borrower hereby authorizes the Agent or its designee to file one
or more financing or continuation statements, and amendments thereto and
assignments thereof, relative to all or any of the Collateral now existing or
hereafter arising in the name of the Borrower. If the Borrower fails to promptly
execute and deliver to the Agent any financing statement or continuation
statement or amendment thereto or assignment thereof requested by the Agent, the
Borrower hereby authorizes the Agent to execute such statement on behalf of the
Borrower. If the Borrower fails to perform any of its agreements or obligations
under this Agreement, the Agent or its designee may (but shall not be required
to) itself perform, or cause performance of, such agreement or obligation, and
the reasonable expenses of the Agent or its designee incurred in connection
therewith shall be payable by the Borrower as provided in Section 14.5.
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SECTION 8.6. APPLICATION OF COLLECTIONS. Any payment by an Obligor in
respect of any indebtedness owed by it to the Originator, the Seller or the
Borrower shall, except as otherwise specified by such Obligor or required by the
underlying Contract or law, be applied, first, as a Collection of any Receivable
or Receivables then outstanding of such Obligor in the order of the age of such
Receivables, starting with the oldest of such Receivables and, second, to any
other indebtedness of such Obligor.
ARTICLE IX
SECURITY INTEREST
SECTION 9.1. GRANT OF SECURITY INTEREST. To secure the due and punctual
payment of the Obligations, whether now or hereafter existing, due or to become
due, direct or indirect, or absolute or contingent, including, without
limitation, all Indemnified Amounts, in each case pro rata according to the
respective amounts thereof, the Borrower hereby pledges to the Agent, for the
benefit of the Secured Parties, and hereby grants to the Agent, for the benefit
of the Secured Parties, a security interest in, all of the Borrower's right,
title and interest now or hereafter existing in, to and under (a) all the
Receivables and Related Assets, (b) the Purchase and Sale Agreement and the
other Transaction Documents (other than the Initial PCA Note and the Seller
Note), and (c) all proceeds of any of the foregoing (collectively, the
"COLLATERAL").
SECTION 9.2. REMEDIES. Upon the occurrence of an Event of Default, the
Agent, on behalf of the Secured Parties, shall have, with respect to the
Collateral granted pursuant to Section 9.1, and in addition to all other rights
and remedies available to the Secured Parties or the Agent under this Agreement
and the other Transaction Documents or other applicable law, all the rights and
remedies of a secured party upon default under the UCC.
SECTION 9.3. TERMINATION AFTER FINAL PAYOUT DATE. Each of the Secured
Parties hereby authorizes the Agent, and the Agent hereby agrees, promptly after
the Final Payout Date to execute and deliver to the Borrower such UCC-3
termination statements as may be necessary to terminate the Agent's security
interest in and Lien upon the Collateral, all at the Borrower's expense. Upon
the Final Payout Date, all right, title and interest of the Agent and the
Secured Parties in and to the Collateral shall terminate.
SECTION 9.4. LIMITATION ON RIGHTS TO COLLATERAL PROCEEDS. Nothing in this
Agreement shall entitle the Secured Parties to receive or retain proceeds of the
Collateral in excess of the aggregate amount of the Obligations owing to such
Secured Party (or to any Indemnified Party claiming through such Secured Party).
ARTICLE X
EVENTS OF DEFAULT
SECTION 10.1. EVENTS OF DEFAULT. The occurrence of any of the following
events shall constitute an "EVENT OF DEFAULT" hereunder:
(a) The Servicer or the Borrower shall fail to make (i) when and as
required to be made by it herein, payments of or deposits of any amount of
principal of any Loan, or (ii) within two Business Days after the same
becomes due, payment of any amount of
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interest, fees or any other Obligations payable hereunder or under any
other Transaction Document; PROVIDED THAT any interest, fees or other
amounts which are not paid on the due date shall bear interest at the
Default Rate after such due date; or
(b) Any representation or warranty made or deemed to be made by any
Loan Party (or any of its officers) under this Agreement or any other
Transaction Document or any Information Package or other information,
recomputation of the Borrowing Base or other report delivered pursuant
hereto shall prove to have been false or incorrect in any material adverse
respect when made or deemed to have been made; or
(c)(i) Any Loan Party fails to perform or observe any term, covenant
or agreement contained in any of SECTIONS 3.1(a), 7.1(i), 7.2(e), 7.2(f),
7.2(g), 7.2(h), 7.3(a), 7.3(b), 7.3(c), 7.3(d), 7.3(f) or 8.2(b); or
(ii) Any Loan Party fails to perform or observe any other term or
covenant contained in this Agreement or any other Transaction Document, and
such default shall continue unremedied for a period of 30 days after the
date upon which written notice thereof is given to such Loan Party by the
Agent; or
(d)(i) The Borrower or the Seller shall (A) fail to pay any principal
or interest, regardless of amount, due in respect of any Indebtedness of
which the aggregate unpaid principal amount is in excess of $10,000, when
and as the same shall become due and payable (after expiration of any
applicable grace period) or (B) fail to observe or perform any other term,
covenant, condition or agreement (after expiration of any applicable grace
period) contained in any agreement or instrument evidencing or governing
any such Indebtedness if the effect of any failure referred to in this
CLAUSE (B) is to cause, or permit the holder or holders of such
Indebtedness or a trustee on its or their behalf (with or without the
giving of notice, the lapse of time or both) to cause, such Indebtedness to
become due prior to its stated maturity; or
(ii) Performance Guarantor or any of its Subsidiaries (other than the
Borrower) (A) shall fail to pay any principal or interest, regardless of
amount, due in respect of any Indebtedness (other than Indebtedness arising
under the Senior Credit Agreement) of which the aggregate unpaid principal
amount is in excess of $10,000,000, when and as the same shall become due
and payable (after expiration of any applicable grace period) or (B) shall
fail to observe or perform any other term, covenant, condition or agreement
(after expiration of any applicable grace period) contained in any
agreement or instrument evidencing or governing any such (other than
Indebtedness arising under the Senior Credit Agreement) Indebtedness if the
effect of any failure referred to in this CLAUSE (B) is to cause, or permit
the holder or holders of such Indebtedness or a trustee on its or their
behalf (with or without the giving of notice, the lapse of time or both) to
cause such Indebtedness to become due prior to its stated maturity;
(iii) An "EVENT OF DEFAULT" under and as defined in the Senior Credit
Agreement; shall occur and (i) be continuing for more than 20 consecutive
days or (ii) result in the acceleration of any amount payable thereunder;
or
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(e) An Event of Bankruptcy shall have occurred and remain continuing
with respect to any Loan Party or, if the Servicer is not Performance
Guarantor or an Affiliate thereof, with respect to the Servicer; or
(f) At any Cut-off Date, the average of the Dilution Ratio for the
period of three calendar months then ended exceeds 1.25%; or
(g) At any Cut-off Date, the average of the Default Ratio for the
period of three calendar months then ended exceeds 1.25%; or
(h) At any Cut-off Date, the average of the Delinquency Ratio for the
period of three calendar months then ended exceeds 2.00%; or
(i) On any Settlement Date, after giving effect to the payments made
under Article II or Article III, the aggregate outstanding principal
balance of the Advances exceeds the least of the Borrowing Base, the
Aggregate Commitment or the Allocation Limit; or
(j) There shall have occurred any event which materially adversely
impairs the ability of the Originator to originate Receivables of a credit
quality not materially different than the credit quality of the Receivables
acquired by the Seller and sold to the Borrower on the Closing Date or any
other event occurs that is reasonably likely to have a Material Adverse
Effect; or
(k) A Change in Control shall occur; or
(l) The Internal Revenue Service shall file notice of a lien pursuant
to Section 6323 of the Internal Revenue Code with regard to any of the
Receivables or Related Assets and such lien has had or would reasonably be
expected to have a Material Adverse Effect and shall not have been released
within seven (7) days, or the Pension Benefit Guaranty Corporation shall,
or shall indicate its intention to, file notice of a lien pursuant to
Section 4068 of the Employee Retirement Income Security Act of 1974 with
regard to any of the Receivables or Related Assets and such lien would
reasonably be expected to have a Material Adverse Effect; or
(m) The Agent, on behalf of the Secured Parties, for any reason, does
not have a valid, perfected first priority security interest in the
Receivables or the Related Assets described in clauses (b), (d) or (e) of
the definition thereof; or
(n)(i) One or more non-interlocutory judgments, non-interlocutory orders,
decrees or arbitration awards is entered against the Borrower or the Seller
involving in the aggregate a liability (to the extent not covered by
independent third-party insurance as to which the insurer does not dispute
coverage) as to any single or related series of transactions, incidents or
conditions, of $10,000 or more, with respect to the Borrower, or $100,000
or more, with respect to the Seller, and the same shall remain unsatisfied,
unvacated and unstayed pending appeal for a period of 60 days after the
entry thereof, or any non-monetary judgment, order or decree is entered
against the Borrower or the Seller, as applicable, which has had or would
reasonably be expected to have a Material Adverse Effect; or
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(ii) One or more non-interlocutory judgments, non-interlocutory
orders, decrees or arbitration awards is entered against the Originator
involving in the aggregate a liability (to the extent not covered by
independent third-party insurance as to which the insurer does not dispute
coverage) as to any single or related series of transactions, incidents or
conditions, of $10,000,000 or more, and the same shall remain unsatisfied,
unvacated and unstayed pending appeal for a period of 60 days after the
entry thereof, or any non-monetary judgment, order or decree is entered
against the Originator which has had or would reasonably be expected to
have a Material Adverse Effect; or
(o)(i) An ERISA Event shall occur with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Originator under Title IV of ERISA to such
Pension Plan, such Multiemployer Plan or the PBGC in an aggregate amount in
excess of $10,000,000; (ii) the aggregate amount of Unfunded-Pension
Liability among all Pension Plans at any time exceeds $10,000,000; or (iii)
the Originator or any ERISA Affiliate shall fail to pay when due, after the
expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of $10,000,000.
SECTION 10.2. REMEDIES.
(a) OPTIONAL AMORTIZATION. Upon the occurrence of an Event of Default
(other than an Event of Default described in Section 10.1(e) with respect to the
Borrower), the Agent may by notice to the Borrower, declare the Termination Date
to have occurred, whereupon the Aggregate Commitment shall terminate and all
Collections shall be allocated and distributed pursuant to Section 3.2(b)
hereof.
(b) AUTOMATIC AMORTIZATION. Upon the occurrence of an Event of Default
described in Section 10.1(e) with respect to the Borrower, the Termination Date
shall automatically occur and Collections shall be allocated and distributed
pursuant to Section 3.2(b) hereof.
(c) ADDITIONAL REMEDIES. Upon the Termination Date pursuant to this Section
10.2, the Aggregate Commitment will terminate, no Loans or Advances thereafter
will be made, and the Agent, on behalf of the Secured Parties, 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 each applicable jurisdiction
and other applicable laws, which rights shall be cumulative.
ARTICLE XI
THE AGENT
SECTION 11.1. APPOINTMENT. (a) Each Lender hereby irrevocably designates and
appoints Wachovia Bank, N.A. as its Agent hereunder, and authorizes the Agent to
take such action on its behalf under the provisions of the Transaction Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Agent by the terms of the Transaction Documents, together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary elsewhere in this Agreement, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender or Liquidity
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Bank, and no implied covenants, functions, responsibilities, duties, obligations
or liabilities on the part of the Agent shall be read into this Agreement or
otherwise exist against the Agent.
(b) The provisions of this Article XI are solely for the benefit of the
Agent and the Lenders, and the Borrower shall have any rights as a third-party
beneficiary or otherwise under any of the provisions of this Article XI, except
that this Article XI shall not affect any obligations which the Agent or any
Lender may have to the Borrower under the other provisions of this Agreement.
(c) In performing its functions and duties hereunder, the Agent shall act
solely as the agent of the Secured Parties and does not assume nor shall be
deemed to have assumed any obligation or relationship of trust or agency with or
for the Borrower or any of their respective successors and assigns.
SECTION 11.2. DELEGATION OF DUTIES. The Agent may execute any of its duties
under this Agreement by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such duties.
The Agent shall not be responsible for the negligence or misconduct of any
agents or attorneys-in-fact selected by it with reasonable care.
SECTION 11.3. EXCULPATORY PROVISIONS. Neither the Agent nor any of its
directors, officers, agents or employees shall be (i) liable for any action
lawfully taken or omitted to be taken by it or them or any Person described in
Section 11.2 under or in connection with this Agreement (except for its, their
or such Person's own bad faith, gross negligence or willful misconduct), or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by the Borrower contained in this Agreement
or in any certificate, report, statement or other document referred to or
provided for in, or received under or in connection with, this Agreement or for
the value, validity, effectiveness, genuineness, enforceability or sufficiency
of this Agreement or any other document furnished in connection herewith, or for
any failure of the Borrower to perform its respective obligations hereunder, or
for the satisfaction of any condition specified in Article V, except receipt of
items required to be delivered to the Agent. The Agent shall not be under any
obligation to any Lender or Liquidity Bank to ascertain or to inquire as to the
observance or performance of any of the agreements or covenants contained in, or
conditions of, this Agreement, or to inspect the properties, books or records of
the Borrower. This Section 11.3 is intended solely to govern the relationship
between each Agent, on the one hand, and the Lenders and their respective
Liquidity Banks, on the other.
SECTION 11.4 RELIANCE BY AGENT.
(a) The Agent shall in all cases be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy,
telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by the Agent.
The Agent shall in all cases be fully justified in failing or refusing to
take any action under this Agreement or any other document furnished in
connection herewith unless it shall first receive such advice or
concurrence of such of the Lenders and Liquidity Banks as it shall
determine to be appropriate under the relevant
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circumstances, or it shall first be indemnified to its satisfaction by the
Liquidity Banks against any and all liability, cost and expense which may
be incurred by it by reason of taking or continuing to take any such
action.
(b) Any action taken by the Agent in accordance with Section 11.4(a)
shall be binding upon all Lenders.
SECTION 11.5. NOTICE OF EVENTS OF DEFAULT. The Agent shall not be deemed to
have knowledge or notice of the occurrence of any Event of Default or Unmatured
Default unless the Agent has received notice from a Lender, a Liquidity Bank or
a Loan Party referring to this Agreement, stating that an Event of Default or
Unmatured Default has occurred hereunder and describing such Event of Default or
Unmatured Default. In the event that the Agent receives such a notice, it shall
promptly give notice thereof to the Lenders and Liquidity Banks. The Agent shall
take such action with respect to such Event of Default or Unmatured Default as
shall be directed by the Majority Lenders.
SECTION 11.6. NON-RELIANCE ON AGENT AND OTHER LENDERS. Each of the Lenders
expressly acknowledges that neither the Agent, nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by the Agent hereafter
taken, including, without limitation, any review of the affairs of the Borrower,
shall be deemed to constitute any representation or warranty by the Agent. Each
of the Lenders also represents and warrants to the Agent and the other Lenders
that it has, independently and without reliance upon any such Person (or any of
their Affiliates) and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, prospects, financial and other conditions and
creditworthiness of the Borrower and made its own decision to enter into this
Agreement. Each of the Lenders also represents that it will, independently and
without reliance upon the Agent or any other Liquidity Bank or Lender, and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement, and to make such investigation as it
deems necessary to inform itself as to the business, operations, property,
prospects, financial and other condition and creditworthiness of the Borrower.
Neither of the Agent nor any of the Lenders, nor any of their respective
Affiliates, shall have any duty or responsibility to provide any party to this
Agreement with any credit or other information concerning the business,
operations, property, prospects, financial and other condition or
creditworthiness of the Borrower which may come into the possession of such
Person or any of its respective officers, directors, employees, agents,
attorneys-in-fact or affiliates, except that the Agent shall promptly distribute
to the Lenders and the Liquidity Banks, copies of financial and other
information expressly provided to the Agent by the Borrower pursuant to this
Agreement for distribution to the Lenders.
SECTION 11.7. INDEMNIFICATION OF AGENT. Each Liquidity Bank agrees to
indemnify the Agent and its officers, directors, employees, representatives and
agents (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so), ratably in accordance with their
respective Ratable 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 (including, without
limitation, the reasonable fees and disbursements of counsel for the Agent or
such Person in connection with any investigative, administrative or judicial
proceeding commenced or threatened, whether or not the Agent in its capacity as
such or such Person shall be
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designated a party thereto) that may at any time be imposed on, incurred by or
asserted against the Agent or such Person as a result of, or arising out of, or
in any way related to or by reason of, any of the transactions contemplated
hereunder or the execution, delivery or performance of this Agreement or any
other document furnished in connection herewith (but excluding any such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the bad faith, gross
negligence or willful misconduct of the Agent or such Person as finally
determined by a court of competent jurisdiction).
SECTION 11.8. AGENT IN ITS INDIVIDUAL CAPACITY. The Agent in its individual
capacity and its affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower and their Affiliates
as though it were not the Agent hereunder. With respect to its Loans, if any,
pursuant to this Agreement, the Agent shall have the same rights and powers
under this Agreement as any Lender and may exercise the same as though it were
not an Agent, and the terms "Lender" and "Lenders" shall include the Agent in
its individual capacity.
SECTION 11.9. SUCCESSOR AGENT. The Agent, upon five (5) days' notice to the
Borrower and the Lenders, may voluntarily resign at any time; PROVIDED, HOWEVER,
that Wachovia Bank, N.A. shall not voluntarily resign as the Agent so long as
any of the Liquidity Banks' respective Commitments remain in effect or Blue
Ridge has any outstanding Loans hereunder. If the Agent (other than Wachovia
Bank, N.A.) shall voluntarily resign, then the Majority Lenders during such
five-day period shall appoint, from amongst the remaining Lenders, a successor
agent, whereupon such successor agent shall succeed to the rights, powers and
duties of the Agent and the term "Agent" shall mean such successor agent,
effective upon its appointment, and the former Agent's rights, powers and duties
as Agent shall be terminated, without any other or further act or deed on the
part of such former Agent or any of the parties to this Agreement. Upon
replacement of any Agent in accordance with this Section 11.9, the retiring
Agent shall execute such UCC-3 assignments and amendments, and assignments and
amendments of the Transaction Documents, as may be necessary to give effect to
its replacement by a successor Agent. After any retiring Agent's resignation
hereunder as Agent, the provisions of this Article XI and Article XIII shall
inure to its benefit as to any actions taken or omitted to be taken by it while
it was Agent under this Agreement.
SECTION 11.10. AGENT'S CONFLICT WAIVERS. Wachovia acts, or may in the future
act, (i) as administrative agent for Blue Ridge, (ii) as issuing and paying
agent for Blue Ridge's Commercial Paper Notes, (iii) to provide credit or
liquidity enhancement for the timely payment for Blue Ridge's Commercial Paper
Notes and (iv) to provide other services from time to time for Blue Ridge
(collectively, the "WACHOVIA ROLES"). Without limiting the generality of
Sections 11.1 and 11.8, each Agent, Lender and Liquidity Bank hereby
acknowledges and consents to any and all Wachovia Roles and agrees that in
connection with any Wachovia Role, Wachovia may take, or refrain from taking,
any action which it, in its discretion, deems appropriate, including, without
limitation, in its role as administrative agent for Blue Ridge, the giving of
notice to the Liquidity Banks of a mandatory purchase pursuant to the Liquidity
Agreement, and hereby acknowledges that neither Wachovia nor any of its
Affiliates has any fiduciary duties hereunder to any Lender (other than Blue
Ridge) or to any of the Liquidity Banks arising out of any Wachovia Roles.
SECTION 11.11. UCC FILINGS. Each of the Secured Parties hereby expressly
recognizes and agrees that the Agent may be listed as the assignee or secured
party of record on the various UCC filings required to be made under the
Transaction Documents in order to perfect their respective
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interests in the Collateral, that such listing shall be for administrative
convenience only in creating a record or nominee holder to take certain actions
hereunder on behalf of the Secured Parties and that such listing will not affect
in any way the status of the Secured Parties as the true parties in interest
with respect to the Collateral. In addition, such listing shall impose no duties
on the Agent other than those expressly and specifically undertaken in
accordance with this Article XI.
ARTICLE XII
ASSIGNMENTS AND PARTICIPATIONS
SECTION 12.1. RESTRICTIONS ON ASSIGNMENTS, ETC. (a) Neither the Borrower nor
the Servicer may assign its rights, or delegate its duties hereunder or any
interest herein without the prior written consent of the Agent; PROVIDED,
HOWEVER, that the foregoing shall not be deemed to restrict Seller's right,
prior to delivery of a Successor Notice, to delegate its duties as Servicer to
the Originator, provided that Seller shall remain primarily liable for the
performance or non-performance of such duties.
(b) Blue Ridge may, at any time, assign all or any portion of a Loan, or
sell participations therein, to the Liquidity Banks (or to the Agent for the
ratable benefit of the Liquidity Banks).
(c) In addition to, and not in limitation of, assignments and
participations described in Section 12.1(b):
(i) in the event that any Liquidity Bank becomes a Downgraded
Liquidity Bank, such Downgraded Liquidity Bank shall give prompt written
notice of its Downgrading Event to the Agent and to the Borrower, whereupon
the Agent may identify an Eligible Assignee and the Downgraded Liquidity
Bank shall promptly assign its rights and obligations to the Eligible
Assignee designated by the Agent against payment in full of its
Obligations;
(ii) each of the Lenders may assign all or any portion of its Loans
and, if applicable, its Commitment under this Agreement to any Eligible
Assignee; and
(iii) each of the Lenders may sell participations in all or any
portion of their respective rights and obligations in, to and under the
Transaction Documents and the Obligations in accordance with Sections 12.2
and 14.7.
SECTION 12.2. RIGHTS OF ASSIGNEES AND PARTICIPANTS. (a) Upon the assignment
by a Lender in accordance with Section 12.1(b) or (c), the Eligible Assignee(s)
receiving such assignment shall have all of the rights of such Lender with
respect to the Transaction Documents and the Obligations (or such portion
thereof as has been assigned).
(b) In no event will the sale of any participation interest in any
Lender's or any Eligible Assignee's rights under the Transaction Documents or in
the Obligations relieve the seller of such participation of its obligations, if
any, hereunder or, if applicable, under the applicable Liquidity Agreement.
SECTION 12.3. TERMS AND EVIDENCE OF ASSIGNMENT. Any assignment to any
Eligible Assignee(s) pursuant to SECTION 1.8, 12.1(b) or 12.1(c) shall be upon
such terms and conditions as the
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assigning Lender and the Agent, on the one hand, and the Eligible Assignee, on
the other, may mutually agree, and shall be evidenced by such instrument(s) or
document(s) as may be satisfactory to such Lender, the Agent and the Eligible
Assignee(s). Any assignment made in accordance with the terms of the Article XII
shall relieve the assigning Lender of its obligations, if any, under this
Agreement (and, if applicable, the Liquidity Agreement) to the extent assigned.
ARTICLE XIII
INDEMNIFICATION
SECTION 13.1. INDEMNITIES BY THE BORROWER.
(a) GENERAL INDEMNITY. Without limiting any other rights which any such
Person may have hereunder or under applicable law, the Borrower hereby agrees to
indemnify each of the Agent, the Lenders, each of their respective Affiliates,
and all successors, transferees, participants and assigns and all officers,
directors, shareholders, controlling persons, employees and agents of any of the
foregoing (each, an "INDEMNIFIED PARTY"), forthwith on demand, from and against
any and all damages, losses, claims, liabilities and related costs and expenses,
including attorneys' fees and disbursements (all of the foregoing being
collectively referred to as "INDEMNIFIED AMOUNTS") awarded against or incurred
by any of them arising out of or relating to the Transaction Documents, the
Obligations or the Collateral, EXCLUDING, HOWEVER, (i) Indemnified Amounts to
the extent determined by a court of competent jurisdiction to have resulted from
bad faith, gross negligence or willful misconduct on the part of such
Indemnified Party, (ii) recourse (except as otherwise specifically provided in
this Agreement) for Indemnified Amounts to the extent the same includes losses
in respect of Receivables which are uncollectible on account of the insolvency,
bankruptcy or lack of creditworthiness of the related Obligor, (iii) Indemnified
Amounts that represent taxes based upon, or measured by, net income, or changes
in the rate of tax or as determined by reference to the overall net income, of
such Indemnified Party, (iv) Indemnified Amounts that represent franchise taxes,
taxes on, or in the nature of, doing business taxes or capital taxes or (v)
Indemnified Amounts that represent withholding taxes required for payments made
to any foreign entity which, at the time such foreign entity issues its
Commitment or Liquidity Commitment or becomes an assignee of a Lender hereunder,
fails to deliver to the Agent and the Borrower an accurate IRS Form W-8 BEN or
W-8 ECI, as applicable. Without limiting the foregoing, the Borrower shall
indemnify each Indemnified Party for Indemnified Amounts arising out of or
relating to:
(A) the creation of any Lien on, or transfer by any Loan Party of any
interest in, the Collateral other than the sale of Receivables and related
property by the Originator to the Seller pursuant to the Sale Agreement and
by the Seller to the Borrower pursuant to the Purchase and Sale Agreement
and the grant by the Borrower of a security interest in the Collateral to
the Agent pursuant to Section 9.1;
(B) any representation or warranty made by any Loan Party (or any of
its officers) under or in connection with any Transaction Document, any
Information Package or any other information or report delivered by or on
behalf of any Loan Party pursuant hereto, which shall have been false,
incorrect or misleading in any respect when made or deemed made or
delivered, as the case may be;
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(C) the failure by any Loan Party to comply with any applicable law,
rule or regulation with respect to any Receivable or the related Contract,
or the nonconformity of any Receivable or the related Contract with any
such applicable law, rule or regulation;
(D) the failure to vest and maintain vested in the Agent, for the
benefit of the Secured Parties, a valid and perfected first priority
security interest in the Collateral, free and clear of any other Lien,
other than a Lien arising solely as a result of an act of one of the
Secured Parties, now or at any time thereafter;
(E) the failure to file, or any delay in filing, financing statements
or other similar instruments or documents under the UCC of any applicable
jurisdiction or other applicable laws with respect to any Collateral;
(F) 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 Receivables or the related
Contract not being a legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms), or any other claim
resulting from the sale of the services related to such Receivable or the
furnishing or failure to furnish such services;
(G) any matter described in SECTION 3.4;
(H) any failure of any Loan Party, as the Borrower, the Servicer or
otherwise, to perform its duties or obligations in accordance with the
provisions of this Agreement or the other Transaction Documents to which it
is a party;
(I) any products liability claim or any claim of breach by any Loan
Party of any related Contract with respect to any Receivable;
(J) any tax or governmental fee or charge, all interest and penalties
thereon or with respect thereto, and all out-of-pocket costs and expenses,
including the reasonable fees and expenses of counsel in defending against
the same, which may arise by reason of the Agent's security interest in the
Collateral;
(K) the commingling of Collections of Receivables at any time with
other funds;
(L) any investigation, litigation or proceeding related to or arising
from this Agreement or any other Transaction Document, the transactions
contemplated hereby or thereby, the use of the proceeds of any Loan, the
security interest in the Receivables and Related Assets or any other
investigation, litigation or proceeding relating to the Borrower, the
Seller or the Originator in which any Indemnified Party becomes involved as
a result of any of the transactions contemplated hereby or thereby (other
than an investigation, litigation or proceeding (1) relating to a dispute
solely amongst the Lenders (or certain Lenders) and the Agent or (2)
excluded by SECTION 13.1(a));
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(M) any inability to litigate any claim against any Obligor in respect
of any Receivable as a result of such Obligor being immune from civil and
commercial law and suit on the grounds of sovereignty or otherwise from any
legal action, suit or proceeding;
(N) the occurrence of any Event of Default of the type described in
SECTION 10.1(e); or
(O) any loss incurred by any of the Secured Parties as a result of the
inclusion in the Borrowing Base of Receivables owing from any single
Obligor and its Affiliated Obligors which causes the aggregate Unpaid
Balance of all such Receivables to exceed the applicable Obligor
Concentration Limit.
(b) CONTEST OF TAX CLAIM; AFTER-TAX BASIS. If any Indemnified Party shall
have notice of any attempt to impose or collect any tax or governmental fee or
charge for which indemnification will be sought from any Loan Party under
Section 13.1(a)(xi), such Indemnified Party shall give prompt and timely notice
of such attempt to the Borrower and the Borrower shall have the right, at its
expense, to participate in any proceedings resisting or objecting to the
imposition or collection of any such tax, governmental fee or charge.
Indemnification hereunder shall be in an amount necessary to make the
Indemnified Party whole after taking into account any tax consequences to the
Indemnified Party of the payment of any of the aforesaid taxes (including any
deduction) and the receipt of the indemnity provided hereunder or of any refund
of any such tax previously indemnified hereunder, including the effect of such
tax, deduction or refund on the amount of tax measured by net income or profits
which is or was payable by the Indemnified Party.
(c) CONTRIBUTION. If for any reason the indemnification provided above in
this Section 13.1 (and subject to the exceptions set forth therein) is
unavailable to an Indemnified Party or is insufficient to hold an Indemnified
Party harmless, then the Borrower shall contribute to the amount paid or payable
by such Indemnified Party as a result of such loss, claim, damage or liability
in such proportion as is appropriate to reflect not only the relative benefits
received by such Indemnified Party on the one hand and the Borrower on the other
hand but also the relative fault of such Indemnified Party as well as any other
relevant equitable considerations.
SECTION 13.2. INDEMNITIES BY SERVICER. Without limiting any other rights
which any Indemnified Party may have hereunder or under applicable law, the
Servicer hereby agrees to indemnify each of the Indemnified Parties forthwith on
demand, from and against any and all Indemnified Amounts awarded against or
incurred by any of them arising out of or relating to the Servicer's performance
of, or failure to perform, any of its obligations under or in connection with
any Transaction Document, or any representation or warranty made by the Servicer
(or any of its officers) under or in connection with any Transaction Document,
any Information Package or any other information or report delivered by or on
behalf of the Servicer, which shall have been false, incorrect or misleading in
any material respect when made or deemed made or delivered, as the case may be,
or the failure of the Servicer to comply with any applicable law, rule or
regulation with respect to any Receivable or the related Contract.
Notwithstanding the foregoing, in no event shall any Indemnified Party be
awarded any Indemnified Amounts (a) to the extent determined by a court of
competent jurisdiction to have resulted from gross negligence or willful
misconduct on the part of such Indemnified Party, (b) as recourse for
Indemnified Amounts to the extent the same includes losses in respect of
Receivables which are uncollectible on account of the insolvency, bankruptcy or
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lack of creditworthiness of the related Obligor, (c) that represent taxes based
upon, or measured by, net income, of changes in the rate of tax or as determined
by reference to the overall net income, of such Indemnified Party, (d) that
represent franchise taxes, taxes on, or in the nature of, doing business taxes
or capital taxes or (e) that represent withholding taxes required for payments
made to any foreign entity which, at the time such foreign entity issues its
Commitment or Liquidity Commitment or becomes an assignee of a Lender hereunder,
fails to deliver to the Agent and the Borrower an accurate IRS Form W-8 BEN or
W-8 ECI, as applicable.
If for any reason the indemnification provided above in this Section 13.2
(and subject to the exceptions set forth therein) is unavailable to an
Indemnified Party or is insufficient to hold an Indemnified Party harmless, then
the Servicer shall contribute to the amount paid or payable by such Indemnified
Party as a result of such loss, claim, damage or liability in such proportion as
is appropriate to reflect not only the relative benefits received by such
Indemnified Party on the one hand and the Servicer on the other hand but also
the relative fault of such Indemnified Party as well as any other relevant
equitable considerations.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1. AMENDMENTS, ETC. No amendment or waiver of any provision of
this Agreement nor consent to any departure by any Loan Party therefrom shall in
any event be effective unless the same shall be in writing and signed by the
Borrower and the Agent, and any such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given. The
Borrower acknowledges that, before entering into such an amendment or granting
such a waiver or consent, the Agent will be required to obtain the approval of
the Lenders and the Liquidity Banks.
SECTION 14.2. NOTICES, ETC. All notices and other communications provided
for hereunder shall, unless otherwise stated herein, be in writing (including
facsimile communication) and shall be personally delivered or sent by express
mail or courier or by certified mail, postage prepaid, or by facsimile, to the
intended party at the address or facsimile number of such party set forth on
Schedule 14.2 or at such other address or facsimile number as shall be
designated by such party in a written notice to the other parties hereto. All
such notices and communications shall be effective, (a) if personally delivered
or sent by express mail or courier or if sent by certified mail, when received,
and (b) if transmitted by facsimile, when sent, receipt confirmed by telephone
or electronic means.
SECTION 14.3. NO WAIVER; REMEDIES. No failure on the part of any Agent or
any of the Secured Parties to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law. Without limiting the
foregoing, each of the Agent, the Lenders and the Liquidity Banks is hereby
authorized by the Borrower at any time and from time to time, to the fullest
extent permitted by law, to set off and apply to payment of any Obligations that
are then due and owing any and all deposits (general or special, time or demand
provisional or final) at any time held and other indebtedness at any time owing
by such Person to or for the credit or the account of the Borrower.
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SECTION 14.4. BINDING EFFECT; SURVIVAl. This Agreement shall be binding upon
and inure to the benefit of the Borrower, the Agent, the Lenders and their
respective successors and assigns, and the provisions of Section 4.2 and Article
XIII shall inure to the benefit of the Affected Parties and the Indemnified
Parties, respectively, and their respective successors and assigns; PROVIDED,
HOWEVER, nothing in the foregoing shall be deemed to authorize any assignment
not permitted by Section 12.1. This Agreement shall create and constitute the
continuing obligations of the parties hereto in accordance with its terms, and
shall remain in full force and effect until the Final Payout Date. The rights
and remedies with respect to any breach of any representation and warranty made
by the Borrower pursuant to Article VI and the indemnification and payment
provisions of Article XIII and Sections 4.2, 14.5, 14.6, 14.7, 14.8 and 14.15
shall be continuing and shall survive any termination of this Agreement.
SECTION 14.5. COSTS, EXPENSES AND TAXES. In addition to its obligations
under the other provisions of this Agreement, the Borrower agrees to pay:
(a) within 15 Business Days after receipt of a written invoice
therefor: all reasonable out-of-pocket costs and expenses incurred by the
Agent, in connection with (i) the negotiation, preparation, execution and
delivery of this Agreement, the other Transaction Documents or the
Liquidity Agreement (subject to the limitations set forth in the Fee
Letter), or (ii) the administration of the Transaction Documents prior to
an Event of Default including, without limitation, (A) the reasonable fees
and expenses of a single law firm acting as counsel to the Agent and the
Lenders incurred in connection with any of the foregoing, and (B) subject
to the limitations set forth in the Fee Letter and in Section 7.1(c), the
reasonable fees and expenses of independent accountants incurred in
connection with any review of any Loan Party's books and records either
prior to or after the execution and delivery hereof;
(b) within 15 Business Days after receipt of a written invoice
therefor: all reasonable out-of-pocket costs and expenses (including,
without limitation, the reasonable fees and expenses of counsel and
independent accountants) incurred by each of the Lenders, the Agent and the
Liquidity Banks in connection with the negotiation, preparation, execution
and delivery of any amendment or consent to, or waiver of, any provision of
the Transaction Documents which is requested or proposed by any Loan Party
(whether or not consummated), the administration of the Transaction
Documents following an Event of Default (or following a waiver of or
consent to any Event of Default), or the enforcement by any of the
foregoing Persons of, or any actual or claimed breach of, this Agreement or
any of the other Transaction Documents, including, without limitation, (i)
the reasonable fees and expenses of counsel to any of such Persons incurred
in connection with any of the foregoing or in advising such Persons as to
their respective rights and remedies under any of the Transaction Documents
in connection with any of the foregoing, and (ii) the reasonable fees and
expenses of independent accountants incurred in connection with any review
of any Loan Party's books and records or valuation of the Receivables and
Related Assets; and
(c) upon demand: all stamp and other taxes and fees payable or
determined to be payable in connection with the execution, delivery, filing
and recording of this Agreement or the other Transaction Documents (and The
Borrower, jointly and severally agree to
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indemnify each Indemnified Party against any liabilities with respect to or
resulting from any delay in paying or omission to pay such taxes and fees).
SECTION 14.6. NO PROCEEDINGS. Each of the parties hereto hereby agrees that
it will not institute against the Borrower or Blue Ridge, or join any Person in
instituting against the Borrower or Blue Ridge, any insolvency proceeding
(namely, any proceeding of the type referred to in the definition of Event of
Bankruptcy) so long as any Commercial Paper Notes or other senior Indebtedness
issued by Blue Ridge shall be outstanding or there shall not have elapsed one
year plus one day since the last day on which any such Commercial Paper Notes or
other senior Indebtedness shall have been outstanding.
SECTION 14.7. CONFIDENTIALITY OF BORROWER INFORMATION.
(a) CONFIDENTIAL BORROWER INFORMATION. Each party hereto (other than the
Borrower) acknowledges that certain of the information provided to such party by
or on behalf of the Borrower in connection with this Agreement and the
transactions contemplated hereby is or may be confidential, and each such party
severally agrees that, unless Performance Guarantor shall otherwise agree in
writing, and except as provided in subsection (b), such party will not disclose
to any other person or entity any information which is designated by any Loan
Party in writing as confidential, whether furnished by any Loan Party or any
attorney for or other representative thereof (each, a "BORROWER INFORMATION
PROVIDER"), is collectively referred to as the "BORROWER INFORMATION");
PROVIDED, HOWEVER, "BORROWER INFORMATION" shall not include any information
which is or becomes generally available to the general public or to such party
on a nonconfidential basis from a source other than any Borrower Information
Provider, or which was known to such party on a nonconfidential basis prior to
its disclosure by any Borrower Information Provider.
(b) DISCLOSURE. Notwithstanding subsection (a), each party may disclose any
Borrower Information:
(i) to any of such party's attorneys and auditors,
(ii) to any dealer or placement agent for such party's Commercial
Paper Notes, who (A) in the good faith belief of such party, has a need to
know the Borrower Information, (B) is informed by such party of the
confidential nature of the Borrower Information and the terms of this
Section 14.7 and (C) has agreed in writing to be bound by the provisions of
this Section 14.7,
(iii) to any Liquidity Bank (whether or not on the date of
disclosure, such Liquidity Bank continues to be an Eligible Assignee), to
any other actual or potential permitted assignee or participant permitted
under Section 12.1 who has agreed to be bound by the provisions of this
Section 14.7,
(iv) to any rating agency that maintains a rating for such party's
Commercial Paper Notes or is considering the issuance of such a rating, for
the purposes of reviewing the credit of any Lender in connection with such
rating,
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(v) to any other party to this Agreement (and any independent
attorneys and auditors of such party), for the purposes contemplated
hereby,
(vi) as may be required by any municipal, state, federal or other
regulatory body having or claiming to have jurisdiction over such party, in
order to comply with any law, order, regulation, regulatory request or
ruling applicable to such party,
(vii) subject to subsection (c), in the event such party is legally
compelled (by interrogatories, requests for information or copies,
subpoena, civil investigative demand or similar process) to disclose such
Borrower Information,
(viii) to any entity that provides a surety bond or other credit
enhancement to Blue Ridge, or
(ix) in connection with the enforcement of this Agreement or any
other Transaction Document.
In addition, each of the Lenders and the Agent may disclose on a "no name" basis
to any actual or potential investor in Commercial Paper Notes information
regarding the nature of this Agreement, the basic terms hereof (including
without limitation the amount and nature of the Aggregate Commitment and the
Advances), the nature, amount and status of the Receivables, and the current
and/or historical ratios of losses to liquidations and/or outstandings with
respect to the Receivables.
(c) LEGAL COMPULSION. In the event that any party hereto (other than any
Loan Party) or any of its representatives is requested or becomes legally
compelled (by interrogatories, requests for information or documents, subpoena,
civil investigative demand or similar process) to disclose any of the Borrower
Information, such party will (or will cause its representative to):
(i) provide Performance Guarantor with prompt written notice so that
(A) Performance Guarantor may seek a protective order or other appropriate
remedy, or (B) Performance Guarantor may, if it so chooses, agree that such
party (or its representatives) may disclose such Borrower Information
pursuant to such request or legal compulsion; and
(ii) unless Performance Guarantor agrees that such Borrower
Information may be disclosed, make a timely objection to the request or
compulsion to provide such Borrower Information on the basis that such
Borrower Information is confidential and subject to the agreements
contained in this SECTION 14.7.
In the event such protective order or remedy is not obtained, or Performance
Guarantor agrees that such Borrower Information may be disclosed, such party
will furnish only that portion of the Borrower Information which (in such
party's good faith judgment) is legally required to be furnished and will
exercise reasonable efforts to obtain reliable assurance that confidential
treatment will be afforded the Borrower Information.
(d) SURVIVAL. This SECTION 14.7 shall survive termination of this
Agreement.
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SECTION 14.8. CONFIDENTIALITY OF PROGRAM INFORMATION.
(a) CONFIDENTIAL INFORMATION. Each party hereto acknowledges that Blue
Ridge and the Agent regard the structure of the transactions contemplated by
this Agreement to be proprietary, and each such party agrees that:
(i) it will not disclose without the prior consent of Blue Ridge or
the Agent (other than to the directors, employees, auditors, counsel or
affiliates (collectively, "REPRESENTATIVES") of such party, each of whom
shall be informed by such party of the confidential nature of the Program
Information (as defined below) and of the terms of this SECTION 14.8): (A)
any information regarding the pricing in, or copies of, this Agreement, the
Liquidity Agreement or the Fee Letter or any transaction contemplated
hereby or thereby, (B) any information regarding the organization, business
or operations of Blue Ridge generally or the services performed by the
Agent for Blue Ridge, or (C) any information which is furnished by Blue
Ridge or the Agent to such party and which is designated by Blue Ridge or
the Agent to such party in writing or otherwise as confidential or not
otherwise available to the general public (the information referred to in
CLAUSES (A), (B) and (C) is collectively referred to as the "PROGRAM
INFORMATION"); PROVIDED, HOWEVER, that such party may disclose any such
Program Information (I) as may be required by any municipal, state, federal
or other regulatory body having or claiming to have jurisdiction over such
party, including, without limitation, the SEC, (II) in order to comply with
any law, order, regulation, regulatory request or ruling applicable to such
party, (III) subject to SUBSECTION (c) below, in the event such party is
legally compelled (by interrogatories, requests for information or copies,
subpoena, civil investigative demand or similar process) to disclose any
such Program Information, or (IV) in financial statements as required by
GAAP;
(ii) it will use the Program Information solely for the purposes of
evaluating, administering and enforcing the transactions contemplated by
the Transaction Documents and making any necessary business judgments with
respect thereto; and
(iii) it will, upon demand, return (and cause each of its
representatives to return) to the Agent, all documents or other written
material received from Blue Ridge or the Agent in connection with (a)(i)
(B) or (C) above and all copies thereof made by such party which contain
the Program Information.
(b) AVAILABILITY OF CONFIDENTIAL INFORMATION. This Section 14.8 shall be
inoperative as to such portions of the Program Information which are or become
generally available to the public or such party on a nonconfidential basis from
a source other than the Agent or were known to such party on a nonconfidential
basis prior to its disclosure by the Agent.
(c) LEGAL COMPULSION TO DISCLOSE. In the event that any party or anyone to
whom such party or its representatives transmits the Program Information is
requested or becomes legally compelled (by interrogatories, requests for
information or documents, subpoena, civil investigative demand or similar
process) to disclose any of the Program Information, such party will:
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(i) provide the Agent with prompt written notice so that the Agent may
seek a protective order or other appropriate remedy and/or, if it so
chooses, agree that such party may disclose such Program Information
pursuant to such request or legal compulsion; and
(ii) unless the Agent agrees that such Program Information may be
disclosed, make a timely objection to the request or confirmation to
provide such Program Information on the basis that such Program Information
is confidential and subject to the agreements contained in this SECTION
14.8.
In the event that such protective order or other remedy is not obtained, or the
Agent agrees that such Program Information may be disclosed, such party will
furnish only that portion of the Program Information which (in such party's good
faith judgment) is legally required to be furnished and will exercise reasonable
efforts to obtain reliable assurance that confidential treatment will be
accorded the Program Information. In the event any Loan Party is required to
file a copy of this Agreement with the SEC or any other governmental authority,
it will (A) provide the Agent with prompt written notice of such requirement and
(B) exercise reasonable efforts to obtain reliable assurance that such
governmental authority will give confidential treatment to this Agreement.
(d) SURVIVAL. This SECTION 14.8 shall survive termination of this
Agreement.
SECTION 14.9. CAPTIONS AND CROSS REFERENCES. The various captions
(including, without limitation, the table of contents) in this Agreement are
provided solely for convenience of reference and shall not affect the meaning or
interpretation of any provision of this Agreement. Unless otherwise indicated,
references in this Agreement to any Section, Appendix, Schedule or Exhibit are
to such Section of or Appendix, Schedule or Exhibit to this Agreement, as the
case may be, and references in any Section, subsection, or clause to any
subsection, clause or subclause are to such subsection, clause or subclause of
such Section, subsection or clause.
SECTION 14.10. INTEGRATION. This Agreement and the other Transaction
Documents contain a final and complete integration of all prior expressions by
the parties hereto with respect to the subject matter hereof and shall
constitute the entire understanding among the parties hereto with respect to the
subject matter hereof, superseding all prior oral or written understandings.
SECTION 14.11. GOVERNING LAW. THIS AGREEMENT, INCLUDING THE RIGHTS AND
DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO PRINCIPLES
OF CONFLICTS OF LAW, EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE SECURITY
INTEREST OF THE AGENT, ON BEHALF OF THE SECURED PARTIES, IN THE COLLATERAL IS
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
SECTION 14.12. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY EXPRESSLY
WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR
DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR UNDER
ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR WHICH MAY IN THE FUTURE BE
DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING OR OTHER
RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER TRANSACTION
DOCUMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL NOT BE TRIED BEFORE
A JURY.
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SECTION 14.13. CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES. EACH SELLER
PARTY HEREBY ACKNOWLEDGES AND AGREES THAT:
(a) IT IRREVOCABLY (i) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION,
FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL
JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER
CASE SITTING IN NEW YORK COUNTY, NEW YORK, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND (ii) WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO, THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF AN ACTION OR PROCEEDING IN SUCH COURTS.
(b) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY
FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN
AID TO EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, IT HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER OR IN CONNECTION WITH THIS AGREEMENT.
SECTION 14.14. EXECUTION IN COUNTERPARTS. This Agreement may be executed in
any number of counterparts and by the 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.
SECTION 14.15. NO RECOURSE AGAINST OTHER PARTIES. The several obligations of
the Lenders under this Agreement are solely the corporate obligations of such
Lender. No recourse shall be had for the payment of any amount owing by such
Lender under this Agreement or for the payment by such Lender of any fee in
respect hereof or any other obligation or claim of or against such Lender
arising out of or based upon this Agreement, against any employee, officer,
director, incorporator or stockholder of such Lender. Each of the Borrower, the
Servicer and the Agent agrees that Blue Ridge shall be liable for any claims
that such party may have against Blue Ridge only to the extent Blue Ridge has
excess funds and to the extent such assets are insufficient to satisfy the
obligations of Blue Ridge hereunder, Blue Ridge shall have no liability with
respect to any amount of such obligations remaining unpaid and such unpaid
amount shall not constitute a claim against Blue Ridge. Any and all claims
against Blue Ridge or the Agent shall be subordinate to the claims against such
Persons of the holders of Commercial Paper Notes and the Liquidity Banks.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
BORROWER:
PACKAGING RECEIVABLES COMPANY, LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Title: Assistant Secretary
& Tax Director
--------------------------------
SERVICER:
PACKAGING CREDIT COMPANY, LLC
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Title: Assistant Secretary
& Tax Director
--------------------------------
Borrower/Servicer Signature Page
AGENT:
WACHOVIA BANK, N.A., as Agent
By: /s/ W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------
Title: Vice President
--------------------
LENDERS:
BLUE RIDGE ASSET FUNDING CORPORATION
By: Wachovia Bank, N.A., its
attorney-in-fact
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------
Title: Vice President
--------------------
Initial Commitment: not applicable
WACHOVIA BANK, N.A.
By: /s/ W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
--------------------
Title: Vice President
--------------------
Initial Commitment: $150,000,000
Agent/Blue Ridge/Wachovia CSA Signature Page
ANNEX A
DEFINITIONS
A. Certain Defined Terms. As used in this Agreement:
"ACCOUNT" shall have the meaning specified in Section 9-106 of the UCC.
"ADJUSTED DILUTION RATIO" at any time means the 12-month rolling average of
the Dilution Ratio for the 12 Settlement Periods then most recently ended.
"ADVANCE" means a borrowing hereunder consisting of the aggregate amount of
the several Loans made on the same Borrowing Date.
"AFFECTED PARTY" means each of the Lenders and the Agent.
"AFFILIATE" means, as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under 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 and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.
"AFFILIATED OBLIGOR" in relation to any Obligor means an Obligor that is an
Affiliate of such Obligor.
"AGENT" has the meaning provided in the preamble of this Agreement.
"AGGREGATE COMMITMENT" means the aggregate of the Commitments of the
Liquidity Banks, as reduced or increased from time to time pursuant to the terms
hereof.
"AGREEMENT" means this
Credit and Security Agreement, as it may be amended
or modified and in effect from time to time.
"ALLOCATION LIMIT" has the meaning set forth in SECTION 1.1.
"ALTERNATE BASE RATE" means for any day, the rate per annum equal to the
higher as of such day of (i) the Base Rate, or (ii) one-half of one percent
(0.50%) above the Federal Funds Rate. For purposes of determining the Alternate
Base Rate for any day, changes in the Base Rate or the Federal Funds Rate shall
be effective on the date of each such change. The Alternate Base Rate is not
necessarily intended to be the lowest rate of interest determined by Wachovia in
connection with extensions of credit.
"ALTERNATE BASE RATE LOAN" means a Loan which bears interest at the
Alternate Base Rate or the Default Rate.
"ARTICLE" means an article of this Agreement unless another document is
specifically referenced.
"BASE RATE" means the rate of interest per annum publicly announced from
time to time by Wachovia as its "prime rate." (The "prime rate" is a rate set by
Wachovia based upon various factors including Wachovia's costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate.) Any change in the prime rate announced by Wachovia shall
take effect at the opening of business on the day specified in the public
announcement of such change.
"BANK RATE SPREAD" has the meaning provided in the Fee Letter.
"BLUE RIDGE" has the meaning provided in the preamble of this Agreement.
"BORROWER" has the meaning provided in the preamble of this Agreement.
"BORROWER INFORMATION" has the meaning set forth in SECTION 14.7(a).
"BORROWER INFORMATION PROVIDER" has the meaning set forth in SECTION
14.7(a).
"BORROWING BASE" means, on any date of determination, the amount determined
by reference to the following formula:
(NPB - RR) - EDC
where:
NPB = the Net Pool Balance as of the most recent Cut-Off Date
occurring at least seven Business Days prior to the date
of determination;
RR = the Required Reserve as of the most recent Cut-Off Date
occurring at least seven Business Days prior to the date
of determination; and
EDC = Deemed Collections that have occurred since the most
recent Cut-Off Date occurring at least seven Business Days
prior to the date of determination to the extent such
Deemed Collections exceed the Dilution Reserve.
"BORROWING DATE" means a date on which an Advance is made hereunder.
"BORROWING REQUEST" is defined in Section 2.1.
"BUSINESS DAY" means (i) any day on which banks are not authorized or
required to close in New York, New York, Chicago, Illinois or Atlanta, Georgia,
and The Depository Trust Company of New York is open for business, and (ii) if
the applicable Business Day relates to any computation or payment to be made
with respect to the Eurodollar Rate (Reserve Adjusted), any day on which
dealings in dollar deposits are carried on in the London interbank market.
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"CHANGE IN CONTROL" means:
(a) the failure of Performance Guarantor to own (directly or through
one or more wholly-owned Subsidiaries of Performance Guarantor) 100% of the
membership interests of the Borrower; or
(b)(i) the acquisition by any Person, or two or more Persons acting in
concert, other than the Principal and its Related Parties, of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Exchange Act) of 20% or more of the outstanding shares
of voting stock of Performance Guarantor or (ii) during any period of up to
12 consecutive months, commencing on the date of this Agreement,
individuals who at the beginning of such 12-month period were directors of
Performance Guarantor shall cease for any reason (other than the death,
disability or retirement of an officer of Performance Guarantor that is
serving as a director at such time so long as another officer of
Performance Guarantor replaces such Person as a director) to constitute a
majority of the Board of Directors of Performance Guarantor.
"CODE" means the Internal Revenue Code of 1986, as the same may be amended
from time to time.
"COLLATERAL" has the meaning set forth in Section 9.1.
"COLLECTION ACCOUNT" has the meaning set forth in Section 7.1(i).
"COLLECTIONS" means all funds which either (i) are received by the
Borrower, the Seller, the Originator or the Servicer from or on behalf of the
related Obligor in payment of any amounts owed (including, without limitation,
purchase prices, finance charges, interest and all other charges) in respect of
such Receivable, or applied to such amounts owed by such Obligor (including,
without limitation, insurance payments that the Borrower, the Seller, the
Originator or the Servicer applies in the ordinary course of its business to
amounts owed in respect of such Receivable and net proceeds of sale or other
disposition of repossessed goods or other collateral or property of the Obligor
or any other party directly or indirectly liable for payment of such Receivable
and available to be applied thereon), or (ii) are Deemed Collections.
"COMMERCIAL PAPER NOTES" shall mean the commercial paper promissory notes,
if any, issued by or on behalf of Blue Ridge that fund any CP Rate Loan.
"COMMITMENT" means, for each Liquidity Bank, its obligation to make Loans
not exceeding the amount set forth opposite its signature to the Agreement, as
such amount may be modified from time to time pursuant to the terms hereof.
"COMMITMENT INCREASE REQUEST" has the meaning set forth in SECTION 1.7.
"COMMITMENT REDUCTION NOTICE" has the meaning set forth in SECTION 1.6.
"CONTRACT" means with respect to any Receivable, any agreement, contract or
other writing with respect to the provision of services by the Originator to an
Obligor, any paper or electronic ▇▇▇▇,
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statement or invoice for services rendered by the Originator to an Obligor, and
any instrument or chattel paper now or hereafter evidencing all or any portion
of the same.
"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of or other instrument, document or agreement to which
such Person is a party or by which it or any of its property is bound.
"CP RATE" means, for any CP Tranche Period, the rate equivalent to the rate
(or if more than one rate, the weighted average of the rates) at which
Commercial Paper Notes of Blue Ridge having a term equal to such CP Tranche
Period are sold plus (to the extent not already deducted from the Principal
Amount of such Commercial Paper Notes) the amount of any placement agent or
commercial paper dealer fees incurred in connection with such sale and other
costs associated with funding small or odd-lot amounts; PROVIDED, HOWEVER, that
if the rate (or rates) as agreed between any such agent or dealer and Blue Ridge
is a discount rate (or rates), the "CP Rate" for such Tranche Period shall be
the rate (or if more than one rate, the weighted average of the rates) resulting
from Blue Ridge's converting such discount rate (or rates) to an
interest-bearing equivalent rate per annum.
"CP RATE LOAN" means a Loan made by Blue Ridge which bears interest at a CP
Rate.
"CP TRANCHE PERIOD" shall mean a period of 7 to 90 days commencing on a
Business Day selected by the Borrower (or by the Servicer on the Borrower's
behalf) and agreed to by the Agent pursuant to Section 2.2. If such CP Tranche
Period would end on a day which is not a Business Day, such CP Tranche Period
shall end on the preceding Business Day.
"CREDIT AND COLLECTION POLICY" means those credit and collection policies
and practices of the Originator relating to Contracts and Receivables as in
effect on the date of this Agreement, as modified without violating Section
7.3(c); PROVIDED that if an Event of Default or an Unmatured Default has
occurred, at the request of the Agent, Packaging Corporation of America shall
provide a copy of its existing Credit and Collection Policy.
"CREDIT EVENT" means, with respect to the Performance Guarantor, the
lowering of the Performance Guarantor's issuer rating or bank debt rating to
below BB- by S&P or the withdrawal or suspension of either such rating.
"CUT-OFF DATE" means October 31, 2000 and the last day of each month
thereafter.
"DAYS SALES OUTSTANDING" or "DSO", means, as of any day, an amount equal to
the product of (x) 91, multiplied by (y) the amount obtained by dividing (i) the
aggregate outstanding balance of Receivables as of the most recent Cut-Off Date,
by (ii) the aggregate amount of Receivables created during the three Settlement
Periods including and immediately preceding such Cut-Off Date.
"DEEMED COLLECTIONS" means Collections deemed received by the Borrower
under Section 3.4.
-4-
"DEFAULT HORIZON RATIO" at any time means the ratio (expressed as a
percentage) computed as of the Cut-Off Date for the next preceding Settlement
Period by dividing the aggregate sales generated during the most recent five
Settlement Periods by the Net Pool Balance as of the most recent Cut-off Date.
"DEFAULT RATE" means a rate per annum equal to the sum of (i) the Alternate
Base Rate plus (ii) 2.00%, changing when and as the Alternate Base Rate changes.
"DEFAULT RATIO" means, as of any Cut-Off Date, the ratio (expressed as a
percentage) computed by dividing (x) the total amount of Receivables which
became Defaulted Receivables during the Settlement Period that includes such
Cut-Off Date, by (y) the aggregate sales generated by the Originator during the
Settlement Period occurring five months prior to the Settlement Period ending on
such Cut-Off Date.
"DEFAULTED RECEIVABLE" means a Receivable: (a) as to which any payment, or
part thereof, remains unpaid for more than 90 days from the original due date
for such payment; or (b) as to which an Event of Bankruptcy has occurred and
remains continuing with respect to the Obligor thereof.
"DELINQUENCY RATIO" at any time means the ratio (expressed as a percentage)
computed as of the Cut-Off Date for the next preceding Settlement Period by
dividing (x) the aggregate Unpaid Balance of all Receivables that are Delinquent
Receivables on such Cut-Off Date by (y) the aggregate Unpaid Balance of
Receivables on such Cut-Off Date.
"DELINQUENT RECEIVABLE" means a Receivable as to which any payment, or part
thereof, remains unpaid for 61-90 days from the original due date for such
payment.
"DILUTION" means the reduction or cancellation of the Unpaid Balance of a
Receivable as described in SECTION 3.4(a).
"DILUTION HORIZON RATIO" means, on any Settlement Date, an amount
calculated by dividing (a) cumulative sales generated during the two most recent
Settlement Periods by (b) the Net Pool Balance as of the most recent Cut-off
Date.
"DILUTION RATIO" means, as of any Settlement Date, a percentage equal to a
fraction, the numerator of which is the total amount of decreases in Unpaid
Balances due to Dilutions during the most recent Settlement Period, and the
denominator of which is the amount of sales generated during the Settlement
Period one month prior to the most recent Settlement Period.
"DILUTION RESERVE" means, as of any Settlement Date, a percentage equal to
the product of (x) the sum of (i) 2.0 times the Adjusted Dilution Ratio, plus
(ii) the Dilution Volatility Component, multiplied by (y) the Dilution Horizon
Ratio.
"DILUTION VOLATILITY COMPONENT" means, as of any Settlement Date, an amount
(expressed as a percentage) equal to the product of (i) the difference between
(a) the highest three-month rolling average Dilution Ratio over the preceding 12
Settlement Periods and (b) the Adjusted Dilution Ratio,
-5-
and (ii) a fraction, the numerator of which is equal to the amount calculated in
(i)(a) of this definition and the denominator of which is equal to the amount
calculated in (i)(b) of this definition.
"DOLLARS" means dollars in lawful money of the United States of America.
"DOWNGRADED LIQUIDITY BANK" means a Liquidity Bank which has been the
subject of a Downgrading Event.
"DOWNGRADING EVENT" with respect to any Liquidity Bank means the lowering
of a rating with regard to the short-term securities of such Liquidity Bank to
below (i) A-1 by S&P, or (ii) P-1 by Moody's.
"ELIGIBLE ASSIGNEE" means (a) any "bankruptcy remote" special purpose
entity which is administered by Wachovia (or any Affiliate of Wachovia) that is
in the business of acquiring or financing receivables, securities and/or other
financial assets and which issues commercial paper notes that are rated at least
A-1 by S&P and P-1 by Moody's, (b) any Qualifying Liquidity Bank having a
combined capital and surplus of at least $250,000,000, or (c) any Downgraded
Liquidity Bank whose liquidity commitment has been fully drawn by Blue Ridge or
the Agent and funded into a collateral account.
"ELIGIBLE RECEIVABLE" means, at any time, a Receivable:
(a) which is a Receivable arising out of the sale of goods or services
by the Originator in the ordinary course of its business that has been sold
or contributed to the Seller pursuant to the Sale Agreement in a "true
sale" or "true contribution" transaction and which has been subsequently
sold or contributed by the Seller to the Borrower in a "TRUE SALE" or "TRUE
CONTRIBUTION" transaction;
(b) as to which the perfection of the Agent's security interest, on
behalf of the Secured Parties, is governed by the laws of a jurisdiction
where the Uniform Commercial Code-Secured Transactions is in force, and
which constitutes an "account" as defined in the UCC as in effect in such
jurisdiction;
(c) the Obligor of which is a resident of the United States or any of
its possessions or territories, and is not (i) an Affiliate of any Loan
Party, or (ii) a Governmental Authority as to which the assignment of
receivables owing therefrom requires compliance with the Federal Assignment
of Claims Act or other similar legislation (unless the Borrower has
complied therewith);
(d) which is not a Defaulted Receivable at such time;
(e) with regard to which the representations and warranties of the
Borrower in SECTIONS 6.1(j) and (l) are true and correct;
(f) the granting of a security interest therein does not contravene or
conflict with any law;
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(g) which is denominated and payable only in Dollars in the United
States;
(h) which arises under a Contract and is evidenced by a Contract, in
each case that has been duly authorized and that, together with such
Receivable, is in full force and effect and constitutes the legal, valid
and binding obligation of the Obligor of such Receivable enforceable
against such Obligor in accordance with its terms and is not subject to any
dispute, offset (except as provided below), counterclaim or defense
whatsoever; PROVIDED, HOWEVER, that if such dispute, offset, counterclaim
or defense affects only a portion of the Unpaid Balance of such Receivable,
then such Receivable may be deemed an Eligible Receivable to the extent of
the portion of such Unpaid Balance which is not so affected, and PROVIDED
FURTHER, that Receivables owing from any Obligor to whom the Originator
owes accounts payable (thereby giving rise to a potential offset) may be
treated as Eligible Receivables to the extent the Obligor of such
receivables has agreed pursuant to a written agreement in form and
substance satisfactory to the Agent, that such Receivables shall not be
subject to such offset;
(i) which, together with the Contract related thereto, does not
contravene in any material respect any laws, rules or regulations
applicable thereto (including, without limitation, laws, rules and
regulations relating to usury, truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection practices
and privacy) and with respect to which no party to the Contract related
thereto is in violation of any such law, rule or regulation in any material
respect if such violation would impair the collectibility of such
Receivable;
(j) which satisfies in all material respects all applicable
requirements of the Originator's Credit and Collection Policy;
(k) which, according to the Contract related thereto, is due and
payable within 61 days from the invoice date of such Receivable;
(l) the original term of which has not been extended (except as
permitted in SECTION 8.2(c)); and
(m) when aggregated with all other Receivables owing from the same
Obligor, not more than 35% of the aggregate Unpaid Balance of all
Receivables owing from such Obligor are Defaulted Receivables.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"ERISA AFFILIATE" means any trade or business (whether or not incorporated)
under common control with Performance Guarantor within the meaning of Section
414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes
of provisions relating to Section 412 of the Code).
"ERISA EVENT" means (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by Performance Guarantor or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in
-7-
Section 4001 (a) (2) of ERISA) or a cessation of operations which is treated as
such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial
withdrawal by Performance Guarantor or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as
a termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e)
an event or condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon Performance Guarantor
or any ERISA Affiliate.
"EURODOLLAR BUSINESS DAY" means a day of the year as defined in CLAUSE (i)
of the definition of Business Day.
"EURODOLLAR LOAN" means a Loan which bears interest at the applicable
Eurodollar Rate.
"EURODOLLAR RATE" means, for any Interest Period, the rate per annum
determined on the basis of the offered rate for deposits in Dollars of amounts
equal or comparable to the principal amount of the related Liquidity Funding
offered for a term comparable to such Interest Period, which rates appear on a
Bloomberg L.P. terminal, displayed under the address "US0001M [Index] Q [Go]"
effective as of 11:00 A.M., London time, two Eurodollar Business Days prior to
the first day of such Interest Period, PROVIDED that if no such offered rates
appear on such page, the Eurodollar Rate for such Interest Period will be the
arithmetic average (rounded upwards, if necessary, to the next higher 1/100th of
1%) of rates quoted by not less than two major banks in New York City, selected
by the Agent, at approximately 10:00 A.M., New York City time, two Eurodollar
Business Days prior to the first day of such Interest Period, for deposits in
Dollars offered by leading European banks for a period comparable to such
Interest Period in an amount comparable to the principal amount of such
Liquidity Funding.
"EURODOLLAR RATE (RESERVE ADJUSTED)" applicable to any Interest Period
means a rate PER ANNUM equal to the quotient obtained (rounded upwards, if
necessary, to the next higher 1/100th of 1%) by DIVIDING (i) the applicable
Eurodollar Rate for such Interest Period by (ii) 1.00 minus the Eurodollar
Reserve Percentage.
"EURODOLLAR RESERVE PERCENTAGE" shall mean, with respect to any Interest
Period, the maximum reserve percentage, if any, applicable to a Liquidity Bank
under Regulation D during such Interest Period (or if more than one percentage
shall be applicable, the daily average of such percentages for those days in
such Interest Period during which any such percentage shall be applicable) for
determining such Liquidity Bank's reserve requirement (including any marginal,
supplemental or emergency reserves) with respect to liabilities or assets having
a term comparable to such Interest Period consisting or included in the
computation of "Eurocurrency Liabilities" pursuant to Regulation D. Without
limiting the effect of the foregoing, the Eurodollar Reserve Percentage shall
reflect any other reserves required to be maintained by such Liquidity Bank by
reason of any Regulatory Change against (a) any category of liabilities which
includes deposits by reference to which the "London Interbank Offered Rate" or
"LIBOR" is to be determined or (b) any category of extensions of credit or other
assets which include LIBOR-based credits or assets.
-8-
"EVENT OF DEFAULT" means an event described in SECTION 10.1.
"EVENT OF BANKRUPTCY" shall be deemed to have occurred with respect to a
Person if either:
(a) a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding up, or
composition or readjustment of debts of such Person, the appointment of a
trustee, receiver, custodian, liquidator, assignee, sequestrator or the
like for such Person or all or substantially all of its assets, or any
similar action with respect to such Person under any law relating to
bankruptcy, insolvency, reorganization, winding up or composition or
adjustment of debts, and such case or proceeding shall continue
undismissed, or unstayed and in effect, for a period of 60 consecutive
days; or an order for relief in respect of such Person shall be entered in
an involuntary case under the federal bankruptcy laws or other similar laws
now or hereafter in effect; or
(b) such Person shall commence a voluntary case or other proceeding
under any applicable bankruptcy, insolvency, reorganization, debt
arrangement, dissolution or other similar law now or hereafter in effect,
or shall consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or other similar
official) for, such Person or for any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall be
adjudicated insolvent, or admit in writing its inability to, pay its debts
generally as they become due, or, if a corporation or similar entity, its
board of directors shall vote to implement any of the foregoing.
"EXCESS CONCENTRATION AMOUNT" means, as of any date, the sum of the amounts
by which the aggregate Unpaid Balance of Receivables of each Obligor exceeds the
Obligor Concentration Limit for such Obligor.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXHIBIT" refers to an exhibit to this Agreement, unless another document
is specifically referenced.
"EXTENSION REQUEST" has the meaning set forth in SECTION 1.8.
"FACILITY FEE" has the meaning set forth in the Fee Letter.
"FEDERAL FUNDS RATE" means, for any day, the rate PER ANNUM (rounded
upwards, if necessary, to the next higher 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, PROVIDED that (i) if the day for which such rate is to be
determined is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the average
rate charged to the Agent on such day on such transactions, as reasonably
determined by the Agent.
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"FEDERAL RESERVE BOARD" means the Board of Governors of the Federal Reserve
System, or any successor thereto or to the functions thereof.
"FEE LETTER" means that certain Fee Letter dated as of November 29, 2000 by
and among Performance Guarantor, the Borrower, Blue Ridge and the Agent.
"FINAL PAYOUT DATE" means the earlier to occur of (i) the date following
the Termination Date on which all Receivables in existence on the Termination
Date have been paid in full or have been charged-off pursuant to the provisions
of the Credit and Collection Policy and (ii) date following the Termination Date
on which the Obligations have been paid in full.
"GAAP" shall mean 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 applicable to the circumstances as of the date
of determination.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"GUARANTEE" of or by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness of any other Person (the "PRIMARY OBLIGOR") in any
manner, whether directly or indirectly, and including any obligation of such
Person, direct or indirect, (a) to purchase or pay (or advance or supply funds
for the purchase or payment of) such Indebtedness or to purchase (or to advance
or supply funds for the purchase of) any security for the payment of such
Indebtedness, (b) to purchase property, securities or services for the purpose
of assuring the owner of such Indebtedness of the payment of such Indebtedness
or (c) to maintain working capital, equity capital or other financial statement
condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness; PROVIDED HOWEVER that the term Guarantee shall
not include endorsements for collection or deposit, in either case, in the
ordinary course of business.
"INDEBTEDNESS" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property or assets purchased by such Person, (e) all obligations of such Person
issued or assumed as the deferred purchase price of property or services (other
than trade payables incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, but limited, if such obligations are without
recourse to such Person, to the lesser of the principal amount of such
Indebtedness or the fair market value of such property, (g) all Guarantees by
such Person of
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Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i)
all obligations of such Person in respect of interest rate protection
agreements, foreign currency exchange agreements or other interest or exchange
rate hedging arrangements (the amount of any such obligation to be the amount
that would be payable upon the acceleration, termination or liquidation thereof)
and (j) all obligations of such Person as an account party in respect of letters
of credit and bankers' acceptances. The Indebtedness of any Person shall include
the Indebtedness of any partnership in which such Person is a general partner.
"INDEMNIFIED AMOUNTS" has the meaning set forth in SECTION 13.1(a).
"INDEMNIFIED PARTY" has the meaning set forth in SECTION 13.1(a).
"INDEPENDENT DIRECTOR" has the meaning set forth in SECTION 7.4(ii).
"INFORMATION PACKAGE" has the meaning set forth in SECTION 3.1.
"INITIAL DUE DILIGENCE AUDITOR" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP.
"INITIAL PCA NOTE" means the Initial PCA Note as defined in the Receivables
Sale Agreement.
"INTEREST PAYMENT DATE" means:
(a) with respect to any CP Rate Loan, the last day of its CP Tranche
Period, the date on which any such Loan is prepaid, in whole or in part,
and the Termination Date;
(b) with respect to any Eurodollar Loan, the last day of its Interest
Period, the date on which any such Loan is prepaid, in whole or in part,
and the Termination Date;
(c) with respect to any Alternate Base Rate Loan, each Settlement Date
while such Loan remains outstanding, the date on which any such Loan is
prepaid, in whole or in part, and the Termination Date; and
(d) with respect to any Loan while the Default Rate is applicable
thereto, upon demand or, in the absence of any such demand, each Settlement
Date while such Loan remains outstanding, the date on which any such Loan
is prepaid, in whole or in part, and the Termination Date.
"INTEREST PERIOD" means, with respect to a Eurodollar Loan, a period of
one, two or three months commencing on a Business Day selected by the Borrower
(or the Servicer on the Borrower's behalf) pursuant to this Agreement and agreed
to by the Agent. Such Interest Period shall end on the day which corresponds
numerically to such date one, two, or three months thereafter, PROVIDED,
HOWEVER, that (i) if there is no such numerically corresponding day in such
next, second or third succeeding month, such Interest Period shall end on the
last Business Day of such next, second or third succeeding month, and (ii) if an
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day unless said next
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succeeding Business Day falls in a new calendar month, then such Interest Period
shall end on the immediately preceding Business Day.
"INTEREST RATE" means a Eurodollar Rate (Reserve Adjusted), a CP Rate, an
Alternate Base Rate or the Default Rate.
"INTEREST RESERVE" shall mean, on any date of determination, 1.5 times the
Alternate Base Rate multiplied by a fraction the numerator of which is the
12-month high Days Sales Outstanding for the preceding period of 12 months and
the denominator of which is 360.
"LENDERS" means Blue Ridge, each Liquidity Bank and their respective
successors and permitted assigns.
"LIEN" means any security interest, lien, encumbrance, pledge, assignment,
title retention, similar claim, right or interest.
"LIQUIDITY AGREEMENT" means the Liquidity Asset Purchase Agreement dated as
of the date hereof among Blue Ridge, the Agent, and the Liquidity Banks from
time to time party thereto, as the same may be amended, restated, supplemented,
replaced or otherwise modified from time to time.
"LIQUIDITY BANK" means (a) Wachovia, (b) any other Liquidity Bank which
becomes a party hereto and (c) any Eligible Assignee of such Liquidity Bank's
Commitment hereunder and under the Liquidity Agreement. A Liquidity Bank will
become a "Lender" hereunder at such time as it makes any Liquidity Funding.
"LIQUIDITY COMMITMENT" means, with respect to each Liquidity Bank, its
commitment to make Liquidity Fundings pursuant to the Liquidity Agreement to
which it is a party.
"LIQUIDITY FUNDING" means (a) a purchase made by any Liquidity Bank
pursuant to its Liquidity Commitment of all or any portion of one of Blue
Ridge's Loans, or (b) any Loan made by the Liquidity Banks in lieu of Blue Ridge
pursuant to SECTION 1.1.
"LIQUIDITY TERMINATION DATE" means the earlier to occur of the following:
(a) the date on which the Liquidity Banks' commitments pursuant to the
Liquidity Agreement expire, cease to be available to Blue Ridge or
otherwise cease to be in full force and effect; or
(b) the date on which a Downgrading Event with respect to a Liquidity
Bank shall have occurred and been continuing for not less than 30 days, and
either (i) the Downgraded Liquidity Bank shall not have been replaced by a
Qualifying Liquidity Bank pursuant to the Applicable Liquidity Agreement,
or (ii) the commitment of such Downgraded Liquidity Bank under a Liquidity
Agreement shall not have been funded or collateralized in such a manner
that will avoid a reduction in or withdrawal of the credit rating applied
to the Commercial Paper Notes to which such Liquidity Agreement applies by
any of the rating agencies then rating such Commercial Paper Notes.
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"LOAN" means any loan made by a Lender to the Borrower pursuant to this
Agreement. Each Loan shall either be a CP Rate Loan, an Alternate Base Rate Loan
or a Eurodollar Rate Loan, selected in accordance with the terms of this
Agreement.
"LOAN PARTIES" means, collectively, the Borrower, the Seller and the
Performance Guarantor.
"LOCK-BOX" has the meaning set forth in the Lock-Box Agreements.
"LOCK-BOX ACCOUNT" means any bank account of the Borrower or the Agent into
which Collections are deposited or transferred and which is subject to a
Lock-Box Agreement.
"LOCK-BOX AGREEMENT" means a letter agreement, in substantially the form of
Exhibit A (or as otherwise approved by the Agent), among the Originator, the
Borrower, the Agent and a Lock-Box Bank.
"LOCK-BOX BANK" means any of the banks holding one or more lock-boxes,
blocked accounts or Lock-Box Accounts receiving Collections from Receivables.
"LOSS RESERVE" as of any Cut-Off Date means a percentage equal the product
of (i) 2.0 times the highest three-month rolling average Default Ratio during
the most recent 12 Settlement Periods and (ii) the Default Horizon Ratio.
"MATERIAL ADVERSE EFFECT" means:
(i) a Credit Event shall have occurred;
(ii) a material impairment of the ability of any Loan Party to
perform under any Transaction Document or to avoid or cure, as applicable,
any Unmatured Default or Event of Default;
(iii) a material adverse effect upon the legality, validity, binding
effect or enforceability against any Loan Party of any Transaction
Document;
(iv) a material adverse effect upon the validity, enforceability or
collectibility of a material portion of the Receivables; or
(v) a material adverse effect upon the validity, perfection,
priority or enforceability of the Borrower's title to -- or the Agent's
security interest, on behalf of the Secured Parties, in -- the Collateral.
"MDP GROUP" shall have the meaning assigned such term in the Senior Credit
Agreement.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTIEMPLOYER PLAN" means a "multiemployer plan", within the meaning of
Section 4001 (a) (3) of ERISA, to which Packaging Corporation of America or any
ERISA Affiliate makes, is
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making, or is obligated to make contributions or, during the preceding three
calendar years, has made, or been obligated to make, contributions.
"NET POOL BALANCE" means, at any time, an amount equal to (i) the aggregate
Unpaid Balance of all Eligible Receivables at such time, MINUS (ii) the Excess
Concentration Amount at such time.
"OBLIGATIONS" means all unpaid principal of and accrued and unpaid interest
on the Loans, all accrued and unpaid fees and all expenses, reimbursements,
indemnities and other obligations of the Borrower to the Lenders (or any
Lender), the Agent or any Indemnified Party arising under the Transaction
Documents.
"OBLIGOR" means a Person obligated to make payments with respect to a
Receivable, including any guarantor thereof.
"OBLIGOR CONCENTRATION LIMIT" means, at any time, in relation to the
aggregate Unpaid Balance of Receivables owed by any single Obligor and its
Affiliated Obligors (if any), the applicable concentration limit (unless the
Agent from time to time upon the Borrower's request agrees to a higher
percentage of Eligible Receivables for a particular Obligor and its Affiliates)
be determined for Obligors who have short term unsecured debt ratings (or, in
the absence of such a rating, the equivalent long term unsecured senior debt
rating as specified below) currently assigned to them by S&P or Moody's;
PROVIDED, HOWEVER, that (a) if such Obligor has a split rating, the applicable
rating will be the lower of the two, (b) if such Obligor is rated by only S&P,
the applicable rating will be deemed to be one ratings tier below the actual
rating by S&P, and (c) if such Obligor is rated by only Moody's, the applicable
rating will be deemed to be one ratings tier below the actual rating by Moody's,
it being understood that if Moody's has assigned a P-1 rating to such Obligor
and S&P has not rated it, the applicable rating will be P-2:
---------------------------------------------------------------------------------------------
Moody's Allowable % of
S&P Long-Term Long-Term S&P Short-Term Moody's Eligible
Rating Rating Rating Short-Term Rating Receivables
---------------------------------------------------------------------------------------------
AAA to AA- Aaa to Aa2 A-1+ P-1 10%
---------------------------------------------------------------------------------------------
A+ A-1 8%
---------------------------------------------------------------------------------------------
A to BBB+ ▇▇▇-▇▇ ▇-▇ P-2 6%
---------------------------------------------------------------------------------------------
▇▇▇-▇▇▇- ▇▇-▇▇▇▇ ▇-▇ P-3 3%
---------------------------------------------------------------------------------------------
Below BBB- or Below Baa 1 or Below A-3 or Not Below P-3 or Not 2%
Not Rated Not Rated Rated Rated
---------------------------------------------------------------------------------------------
"ORIGINATOR" means Packaging Corporation of America, a Delaware
corporation.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"PERCENTAGE SHARE" means, as of any time prior to the Termination Date, the
lesser of (i) 100% and (ii) a fraction, expressed as a percentage, the numerator
of which is the sum of (A) the aggregate principal amount of outstanding Loans,
and (B) the Required Reserve as of the most recent Cut-Off Date occurring at
least five Business Days prior to the date of determination and the denominator
of which is the difference between (A) the Net Pool Balance as of the most
recent Cut-Off Date occurring at least five Business Days, prior to the date of
determination and (B) Deemed
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Collections that have occurred since the most recent Cut-Off Date occurring at
least five Business Days prior to the date of determination to the extent such
Deemed Collections exceed the Dilution Reserve. Prior to the Termination Date,
the Percentage Share shall change whenever the aggregate principal amount of the
outstanding Loans, Required Reserve, Net Pool Balance or amount of Deemed
Collections changes. On and after the Termination Date, the Percentage Share
shall remain fixed at the percentage in effect as of the Termination Date as
determined pursuant to the preceding sentence.
"PENSION PLAN" means a pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA which Packaging Corporation of America sponsors or
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding five plan years.
"PERFORMANCE GUARANTEE" means the Performance Guarantee dated as of the
date hereof from Performance Guarantor to Agent.
"PERFORMANCE GUARANTOR" means Packaging Corporation of America, a Delaware
corporation.
"PERSON" means any natural Person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"PLAN" means an employee benefit plan (as defined in Section 3(3) of ERISA)
which a Loan Party sponsors or maintains or to which a Loan Party makes, is
making, or is obligated to make contributions and includes any Pension Plan,
other than a Plan maintained outside the United States primarily for the benefit
of Persons who are not U.S. residents.
"PREPAYMENT NOTICE" has the meaning set forth in SECTION 1.5(a)
"PRINCIPAL" means MDP Group and its Affiliates.
"PRINCIPAL AMOUNT" means the actual net cash proceeds received by Blue
Ridge upon issuance of a Commercial Paper Note.
"PROGRAM FEE" has the meaning set forth Fee Letter.
"PROGRAM INFORMATION" has the meaning set forth in SECTION 14.8.
"PROPERTY" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"PURCHASE AND SALE AGREEMENT" means the Purchase and Sale Agreement dated
as of the date hereof between the Seller and the Borrower.
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"QUALIFYING LIQUIDITY BANK" means a Liquidity Bank with ratings of its
short-term securities equal to or higher than (i) A-1 by S&P and (ii) P-1 by
▇▇▇▇▇'▇.
"RATABLE SHARE" means (i) with respect to any Lender, the ratio which its
Loans bear to the sum of the Loans of all Lenders and (ii) with respect to any
Liquidity Bank, the ratio which its Commitment bears to the sum of the
Commitments of all Liquidity Banks.
"RECEIVABLE" means any right to payment arising from the sale of products
by the Originator, including, without limitation, the right to payment of any
interest or finance charges and other amounts with respect thereto, which is
sold to the Seller under the Sale Agreement and to the Borrower under the
Purchase and Sale Agreement. Rights to payment arising from any one transaction,
including, without limitation, rights to payment represented by an individual
invoice, shall constitute a Receivable separate from a Receivable consisting of
the rights to payment arising from any other transaction or evidenced by any
other invoice; PROVIDED, HOWEVER, any right to payment referred to in this
sentence shall be a Receivable regardless of whether the account debtor or the
Borrower treats such right to payment as a separate payment obligation.
"REGULATION D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"REGULATION U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"REGULATORY CHANGE" shall mean any change after the date of this Agreement
in United States (federal, state or municipal) or foreign laws or regulations
(including Regulation D) or the adoption or making after such date of any
interpretations, directives or requests applying to a class of banks (including
the Liquidity Banks) of or under any United States (federal, state or municipal)
or foreign, laws, or regulations (whether or not having the force of law) by any
court or governmental or monetary authority charged with the interpretation or
administration thereof.
"RELATED ASSETS" means (a) all rights to, but not any obligations under,
all related Contracts and all Related Security related to any Receivables, (b)
all rights and interests of the Borrower under the Purchase and Sale Agreement
in relation to any Receivables, (c) all books and records evidencing or
otherwise relating to any Receivables, (d) the Collection Account (if any) and
all Lock-Box Accounts and all cash and instruments therein, to the extent
constituting or representing the items in the following clause and (e) all
Collections in respect of, and other proceeds of, any Receivables or any other
Related Assets.
"RELATED PARTIES" shall have the meaning assigned such term in the Senior
Credit Agreement.
"RELATED SECURITY" means, with respect to any Receivable, all of the
Borrower's right, title and interest in and to: (a) all Contracts that relate to
such Receivable; (b) all security deposits and
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other security interests or liens and property subject thereto from time to time
purporting to secure payment of such Receivable, whether pursuant to the
Contract related to such Receivable or otherwise; (c) all UCC financing
statements covering any collateral securing payment of such Receivable; (d) all
guarantees and other agreements or arrangements of whatever character from time
to time supporting or securing payment of such Receivable whether pursuant to
the Contract related to such Receivable or otherwise; and (e) all insurance
policies, and all claims thereunder, related to such Receivable, in each case to
the extent directly related to rights to payment, collection and enforcement,
and other rights with respect to such Receivable.
"REPORTABLE EVENT" means any of the events set forth in Section 4043(c) of
ERISA or the regulations thereunder, other than any such event for which the
30-day notice requirement under ERISA has been waived in regulations issued by
the PBGC.
"REPORTING DATE" has the meaning set forth in SECTION 3.1(a).
"REQUIRED AMOUNTS" has the meaning set forth in SECTION 3.2.
"REQUIRED RESERVE" means, on any day during a Settlement Period, an amount
equal to the product of (A) the greater of (i) 12% and (ii) the sum of (w) the
Loss Reserve, (x) the Dilution Reserve, (y) the Interest Reserve and (z) the
Servicing Reserve (in each case, as of the immediately preceding Settlement
Date) times (B) the Net Pool Balance on such day.
"REQUIREMENT OF LAW" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or final, nonappealable determination of an
arbitrator or of a Governmental Authority, in each case applicable to or binding
upon such Person or any of its property or to which such Person or any of its
property is subject.
"RESPONSE DATE" has the meaning set forth in SECTION 1.8.
"RESPONSIBLE OFFICER" of any Person means any of its Chairman, Chief
Executive Officer, Chief Operating Officer, President, Chief Financial Officer
or Treasurer.
"REVIEW" has the meaning set forth in SECTION 7.1(c).
"REVOLVING PERIOD" means the period from and after the date of the initial
Advance under this Agreement to but excluding the Termination Date.
"S&P" means Standard and Poor's Ratings Services, a division of The McGraw
Hill Companies, Inc.
"SALE AGREEMENT" means the Receivables Sale Agreement dated as of that date
hereof between the Originator, as seller, and the Seller, as purchaser, as it
may be amended, supplemented or otherwise modified in accordance with SECTION
7.3(f).
"SCHEDULE" refers to a specific schedule to this Agreement, unless another
document is specifically referenced.
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"SCHEDULED TERMINATION DATE" means November 29, 2003, unless extended by
unanimous agreement of the Agent, the Lenders and the Liquidity Banks.
"SEC" means the Securities and Exchange Commission.
"SECTION" means a numbered section of this Agreement, unless another
document is specifically referenced.
"SECURED PARTIES" means the Agent, the Indemnified Parties and the Affected
Parties.
"SELLER" means Packaging Credit Company, LLC, a Delaware limited liability
company.
"SELLER NOTE" means the Seller Note as defined in the Purchase and Sale
Agreement.
"SENIOR CREDIT AGREEMENT" means that certain Amended and Restated Credit
Agreement dated as of June 29, 2000 among, the Performance Guarantor, various
Lenders (as defined therein), ▇.▇. ▇▇▇▇▇▇ Securities, Inc., Deutsche Bank
Securities, Inc., ▇▇▇▇▇▇▇ Sachs Credit Partners L.P., and ▇▇▇▇▇▇ Guaranty Trust
Company of New York, with giving effect to any amendment or modifications made
after the date hereof without the prior written consent of the Agent.
"SERVICER" has the meaning set forth in the preamble of this Agreement.
"SERVICER TRANSFER EVENT" means the occurrence of any Unmatured Default or
Event of Default.
"SERVICER'S FEE" accrued for any day in a Settlement Period means:
(a) an amount equal to (x) 1.0% PER ANNUM (or, at any time while
Seller is the Servicer, such lesser percentage as may be agreed between the
Borrower and the Servicer on an arms' length basis based on then prevailing
market terms for similar services), TIMES (y) the aggregate Unpaid Balance
of the Receivables at the close of business on the first day of such
Settlement Period, TIMES (z) 1/360; or
(b) on and after the Servicer's reasonable request made at any time
when Seller shall no longer be the Servicer, an alternative amount
specified by the Servicer not exceeding (x) 110% of the Servicer's
reasonable costs and expenses of performing its obligations under the
Agreement during the Settlement Period when such day occurs, divided by (y)
the number of days in such Settlement Period.
"SERVICING RESERVE" shall mean the product of 1.0% and a fraction, the
numerator of which is the highest Days Sales Outstanding calculated for each of
the most recent 12 Settlement Periods and the denominator of which is 360.
"SETTLEMENT DATE" means (a) the second Business Day after each Reporting
Date, or such later Business Day as the Agent may specify in a written notice to
the Borrower, and (b) the Termination Date.
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"SETTLEMENT PERIOD" means: (a) the period from and including the date of
the initial Advance to and including the next Cut-Off Date; and (b) thereafter,
each period from but excluding a Cut-Off Date to and including the earlier to
occur of the next Cut-Off Date or the Final Payout Date.
"SUBSIDIARY" of any Person means (i) a corporation more than 50% of whose
stock of any class or classes having by the terms thereof ordinary voting power
to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned or controlled by such Person, directly or
indirectly through Subsidiaries, and (ii) any partnership, association, joint
venture or other entity in which such Person, directly or indirectly through
Subsidiaries, has more than a 50% equity interest at the time.
"SUCCESSOR NOTICE" has the meaning set forth in SECTION 8.1(b).
"TERMINATION DATE" means the earliest to occur of:
(a) the Scheduled Termination Date;
(b) the Liquidity Termination Date;
(c) the date designated by the Borrower as the "Termination Date" on
not less than five (5) Business Days' notice to the Agent, PROVIDED that on
such date the Obligations have been paid in full;
(d) the date specified in SECTION 10.2(a) or (b); or
(e) the date on which the Seller ceases selling Receivables to the
Borrower under the Purchase and Sale Agreement.
"TRANSACTION DOCUMENTS" means this Agreement, the Lock-Box Agreements, the
Sale Agreement, the Purchase and Sale Agreement the Fee Letter, the Seller Note,
the Initial PCA Note and the other documents to be executed and delivered in
connection herewith.
"TRANSFEREE" is defined in SECTION 12.4.
"UCC" means the Uniform Commercial Code as from time to time in effect in
the applicable jurisdiction or jurisdictions.
"UNMATURED DEFAULT" means an event which but for the lapse of time or the
giving of notice, or both, would constitute an Event of Default.
"UNPAID BALANCE" of any Receivable means at any time the unpaid amount
thereof, but excluding all late payment charges, delinquency charges and
extension or collection fees.
"UNUSED FEE" has the meaning set forth in the Fee Letter.
"WACHOVIA" has the meaning set forth in the preamble of this Agreement.
-19-
"WACHOVIA ROLES" has the meaning set forth in SECTION 11.10(a).
The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.
B. 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.
C. COMPUTATION OF TIME PERIODS. Unless otherwise stated in this Agreement,
in the computation of a period of time from a specified date to a later
specified date, the word "from" means "from and including" and the words "to"
and "until" each mean "to but excluding".
-20-
EXHIBIT A
FORM OF LOCK-BOX AGREEMENT
[SEE PURCHASE AND SALE AGREEMENT]
EXHIBIT 2.1
FORM OF BORROWING REQUEST
Packaging Receivables Company, LLC
BORROWING REQUEST
For Borrowing On __________________
Wachovia Bank, N.A., as Agent
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇-▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Reference is made to the
Credit and Security Agreement dated as of November
29, 2000 (as amended, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT") among Packaging Receivables Company, LLC (the "BORROWER"),
Packaging Credit Company, LLC, as initial Servicer, Blue Ridge Asset Funding
Corporation, and Wachovia Bank N.A., individually and as Agent. Capitalized
terms defined in the Credit Agreement are used herein with the same meanings.
I. The [SERVICER, ON BEHALF OF THE] Borrower hereby certifies, represents and
warrants to the Agent and the Lenders that on and as of the Borrowing Date
(as hereinafter defined):
(a) all applicable conditions precedent set forth in Article V of the
Credit Agreement have been satisfied;
(b) each of its representations and warranties contained in Section
6.1 of the Credit Agreement will be true and correct, in all material
respects, as if made on and as of the Borrowing Date;
(c) no event will have occurred and is continuing, or would result
from the requested Purchase, that constitutes an Event of Default or
Unmatured Default;
(d) the Termination Date has not occurred; and
(e) after giving effect to the Loans comprising the Advance requested
below, Blue Ridge's and the Liquidity Banks' Loans at any one time
outstanding will not exceed the Allocation Limit.
III. The [SERVICER, ON BEHALF OF THE] Borrower hereby requests that Blue Ridge
(or the Liquidity Banks) make an Advance on ___________, _____ (the
"BORROWING DATE") as follows:
(a) AGGREGATE AMOUNT OF ADVANCE: $_____________
(b) INTEREST RATE REQUESTED: CP Rate (unless you advise the Borrower
that a Liquidity Funding will be made, in which case the [SERVICER ON
BEHALF OF THE] Borrower requests that the Liquidity Banks make an Alternate
Base Rate Loan that converts into Eurodollar Loan with an Interest Period
approximately equal to the CP Tranche Period specified below on the third
Business Day after the Borrowing Date).
(c) CP TRANCHE PERIOD REQUESTED: ________ days
IV. Please disburse the proceeds of the Loans as follows:
[APPLY $________ TO PAYMENT OF PRINCIPAL AND INTEREST OF EXISTING
LOANS DUE ON THE BORROWING DATE]. [APPLY $______ TO PAYMENT OF FEES DUE ON
THE BORROWING DATE]. [WIRE TRANSFER $________ TO ACCOUNT NO. ________ AT
___________ BANK, IN [CITY, STATE], ABA NO. __________, REFERENCE:
________].
IN WITNESS WHEREOF, the [SERVICER, ON BEHALF OF THE] Borrower has caused
this Borrowing Request to be executed and delivered as of this ____ day of
___________, _____.
[_______________________, AS SERVICER,
ON BEHALF OF:] Packaging Receivables
Company, LLC, as Borrower
By:
-----------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
-2-
EXHIBIT 3.1(a)
FORM OF INFORMATION PACKAGE
EXHIBIT 5.1(h)
SUBSTANCE OF CORPORATE/UCC OPINIONS
- All opinions should be addressed to the Agent and the Lenders and should
permit reliance thereon by (A) the Liquidity Banks and (B) S&P and ▇▇▇▇▇'▇.
- The opinion giver must be licensed to practice in the state whose law
governs the Purchase and Sale Agreement and the
Credit and Security
Agreement (i.e., New York)
- Corporate/UCC opinions should address the following matters as to the
Borrower and Originators (collectively, the "COMPANIES"):
1. Each of the Companies has been duly organized and is validly existing
under the laws of Delaware, with power and authority to conduct its business as
now conducted (or, in the case of the Borrower, proposed to be conducted), to
own, or hold under lease, its assets and to enter into the Transaction Documents
to which it is a party and perform its obligations thereunder. Based solely on
certificates from public officials, we confirm that each of the Companies is
qualified to do business in the following States: Delaware, Illinois.
2. The execution, delivery and performance of the Transaction Documents to
which any of the Companies is a party and the execution and delivery of the
Financing Statements naming any of the Companies as debtor or seller have been
duly authorized by all necessary action of such Company, and such Transaction
Documents and Financing Statements have been duly executed and delivered by such
Company.
3. Each of the Transaction Documents constitutes a legally valid and
binding obligation of each of the Companies signatory thereto, enforceable
against such Company in accordance with its terms.
4. The execution and delivery of the Transaction Documents and the
Financing Statements by each of the Companies signatory thereto, and the
performance of their respective obligations do not: (a) violate any federal or
the State of Delaware or State of Illinois statute, rule or regulation
applicable to the Companies (including, without limitation, Regulations T, U or
X of the Board of Governors of the Federal Reserve System), (b) violate the
provisions of the Companies' respective Governing Documents, (c) result in the
breach of or a default under, the creation of a lien under or the acceleration
of indebtedness pursuant to any indenture, credit agreement, lease, note or
other agreement, instrument or contract or any judgment, writ or other court
order, in any of the foregoing cases, which has been identified to you as being
material to any of the Companies, or (d) require any consents, approvals,
authorizations, registrations, declarations or filings by any of the Companies
under any federal or the State of Delaware or State of Illinois statute, rule or
regulation applicable to any of the Companies of the State of Delaware or State
of Illinois except the filing of the Financing Statements in the Office of the
_______________ (the "Filing Office(s)").
5. The provisions of the Purchase and Sale Agreement are effective to
create a valid security interest (as defined in Section 1-201(37) of the New
York UCC) in favor of the Borrower
and its assigns in that portion of the Receivables and Related Rights which
constitute accounts or general intangibles. The provisions of the
Credit and
Security Agreement are effective to create a valid security interest (as defined
above) in favor of the Agent for the benefit of the Secured Parties in that
portion of the Collateral which constitutes accounts or general intangibles as
security for the payment of the Obligations.
6. Each of the Financing Statements is in appropriate form for filing in
the Filing Office specified on the face thereof. Upon the proper filing of each
of the Financing Statements in such Filing Office, the security interest in
favor of the Agent for the benefit of the Secured Parties in the Collateral
described therein will be perfected.
7. Based solely on our review of the Search Reports, and assuming (a) the
proper filing of the Financing Statements in the appropriate Filing Offices, and
(b) the absence of any intervening filings between the date and time of the
Search Reports and the date and time of the filing of the Financing Statements
in the Filing Offices, the security interests of the Agent for the benefit of
Secured Parties in the Collateral described in #6 above will be prior to any
other security interest granted by any of the Companies in such collateral, the
priority of which is determined solely by the filing of a financing statement in
the applicable Filing Office.
8. None of the Companies is an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
-2-
EXHIBIT 7.2
FORM OF CERTIFICATE OF FINANCIAL OFFICER
[NAME OF LOAN PARTY]
CERTIFICATE OF FINANCIAL OFFICER
This Certificate is made pursuant to the provisions of the
Credit and
Security Agreement dated as of November 29, 2000 (as amended or otherwise
modified from time to time in accordance with the terms thereof, the
"Agreement") among Packaging Receivables Company, LLC, as Borrower, Packaging
Credit Company, LLC, as initial Servicer, Blue Ridge Asset Funding Corporation,
and Wachovia Bank, N.A., individually and as Agent. The capitalized terms used,
but not defined, herein have the meanings assigned to them in the Agreement.
The undersigned [FINANCIAL OFFICER] of the [BORROWER/INITIAL SERVICER]
hereby certifies that the financial statements being delivered concurrently
herewith fairly present the financial condition and results of operations of the
[BORROWER/INITIAL SERVICER] in accordance with generally accepted accounting
principles[, SUBJECT TO NORMAL YEAR-END AUDIT ADJUSTMENTS], and that no Default
or Event of Default exists as of the date hereof and is continuing.
[NAME OF LOAN PARTY]
By:
----------------------------
Name:
--------------------------
Dated:
-------------------------
SCHEDULE 6.1(m)
BORROWER'S FEDERAL TAXPAYER ID NUMBER, CHIEF EXECUTIVE OFFICE, PRINCIPAL PLACE
OF BUSINESS AND OTHER RECORDS LOCATION(S)
Federal Taxpayer I.D. No.: Borrower: ▇▇-▇▇▇▇▇▇▇
Servicer: ▇▇-▇▇▇▇▇▇▇
Chief Executive Office (Servicer and Borrower): ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Principal Place of Business:(Servicer and Borrower): ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Other Records Locations:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇. ▇.▇.
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-2-
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇
▇.▇. ▇▇▇ ▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
#▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-3-
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇. #▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-4-
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇. ▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
-5-
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇
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SCHEDULE 6.1(n)
LOCK-BOXES AND ASSOCIATED ACCOUNTS
Bank One, N.A.
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Account No.: 10-14950
Lockboxes:
Chicago Lockbox
Lockbox Number 21594
Packaging Corporation of America
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Charlotte Lockbox
Lockbox Number 905197
Packaging Corporation of America
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▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Pasadena Lockbox
Lockbox Number 100720
Packaging Corporation of America
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Dallas Lockbox
Lockbox Number 730758
Packaging Corporation of America
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▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
SCHEDULE 14.2
NOTICE ADDRESSES AND WIRE TRANSFER INFORMATION
A. BORROWER AND INITIAL SERVICER
ADDRESS FOR NOTICES:
Packaging Receivables Company, LLC
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Attention: ▇▇▇▇ ▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Wire Transfer Instructions:
Account No. 10-48230 at Bank One, N.A.
in Chicago, Illinois
ABA No.▇▇▇▇▇▇▇▇▇
Reference: Blue Ridge Securitization
with a copy to:
Packaging Credit Company, LLC
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Attention: ▇▇▇▇ ▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
B. BLUE RIDGE
ADDRESS FOR NOTICES (OTHER THAN BORROWING REQUESTS):
Blue Ridge Asset Funding Corporation
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Attention: ▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Blue Ridge Asset Funding Corporation
c/o AMACAR Group, L.L.C.
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Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
WIRE TRANSFER INSTRUCTIONS (UNLESS OTHERWISE NOTIFIED):
Account #8735-098787 at Wachovia Bank, N.A.,
ABA #▇▇▇▇▇▇▇▇▇,
Reference: Blue Ridge/Packaging Receivables Company, LLC,
Attention: ▇▇▇▇ ▇▇▇▇▇▇, tel. (▇▇▇) ▇▇▇-▇▇▇▇
C. WACHOVIA BANK, N.A., individually or as Agent
ADDRESS FOR NOTICES (OTHER THAN BORROWING REQUESTS):
Wachovia Bank, N.A.
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Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
WIRE TRANSFER INSTRUCTIONS (UNLESS OTHERWISE NOTIFIED):
Account #8735-098787 at Wachovia Bank, N.A.,
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ABA #▇▇▇▇▇▇▇▇▇,
Reference: Blue Ridge/Packaging Receivables Company, LLC,
Attention: ▇▇▇▇ ▇▇▇▇▇▇, tel. (▇▇▇) ▇▇▇-▇▇▇▇
BORROWING REQUESTS SHOULD BE SENT TO THE
ADDRESS AND FAX NO. SPECIFIED ON EXHIBIT 2.1
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