EXHIBIT 10.55
RECEIVABLES SALE AGREEMENT
Dated as of July 29, 2004
by and among
EACH OF THE ENTITIES PARTY HERETO FROM TIME TO TIME
AS ORIGINATORS,
▇▇▇▇▇▇ FUNDING INC.
and
▇▇▇▇▇▇ MICRO INC.
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS AND INTERPRETATION..................................................................... 1
Section 1.01. Definitions............................................................................... 1
Section 1.02. Rules of Construction..................................................................... 1
ARTICLE II TRANSFERS OF RECEIVABLES.......................................................................... 1
Section 2.01. Agreement to Transfer..................................................................... 1
Section 2.02. Grant of Security Interest................................................................ 4
Section 2.03. Parent Agreement.......................................................................... 4
Section 2.04. Originators Remain Liable................................................................. 4
Section 2.05. Rebates, Adjustments, Returns, Reductions and Modifications............................... 5
Section 2.06. Payments in Respect of Ineligible Receivables and Originator Indemnification Payments..... 5
ARTICLE III CONDITIONS PRECEDENT............................................................................. 6
Section 3.01. Conditions Precedent to the Buyer's Purchase of Receivables and other Receivable
Assets on the Effective Date..................................................................... 6
Section 3.02. Conditions Precedent to All Transfers..................................................... 7
Section 3.03. Conditions Precedent to Each Originator's Obligations on the Effective Date............... 8
Section 3.04. Conditions Precedent to All of Each Originator's Obligations.............................. 8
Section 3.05. Condition Precedent to the Addition of an Originator......................................
ARTICLE IV REPRESENTATIONS, WARRANTIES AND COVENANTS......................................................... 10
Section 4.01. Representations and Warranties of the Originators......................................... 10
Section 4.02. Representations and Warranties of the Originators Relating to the Receivables and
other Receivable Assets.......................................................................... 14
Section 4.03. Representations and Warranties of the Buyer............................................... 14
ARTICLE V AFFIRMATIVE COVENANTS OF THE ORIGINATORS........................................................... 15
Section 5.01. Certificates; Other Information........................................................... 15
Section 5.02. Compliance with Law and Credit and Collection Policy...................................... 16
Section 5.03. Preservation of Existence................................................................. 16
Section 5.04. Separate Corporate Existence.............................................................. 16
Section 5.05. Inspection of Property; Books and Records; Discussions.................................... 17
Section 5.06. Location of Records....................................................................... 17
Section 5.07. Computer Files............................................................................ 17
Section 5.08. Obligations............................................................................... 17
Section 5.09. Collections............................................................................... 18
Section 5.10. Furnishing Copies, Etc.................................................................... 18
Section 5.11. Responsibilities of the Originators....................................................... 18
Section 5.12. Assessments............................................................................... 18
Section 5.13. Further Action............................................................................ 19
Section 5.14. Sale of Receivables and other Receivable Assets........................................... 19
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ARTICLE VI NEGATIVE COVENANTS................................................................................ 19
Section 6.01. Limitations on Transfers of Receivables and other Receivable Assets....................... 20
Section 6.02. Extension or Amendment of Receivables..................................................... 20
Section 6.03. Change in Payment Instructions to Obligors................................................ 20
Section 6.04. Change in Name............................................................................ 20
Section 6.05. Credit and Collection Policy.............................................................. 20
Section 6.06. Modification of Legend.................................................................... 20
Section 6.07. Accounting for Purchases.................................................................. 20
Section 6.08. Instruments............................................................................... 20
Section 6.09. Ineligible Receivables.................................................................... 21
Section 6.10. Business of such Originator............................................................... 21
Section 6.11. Limitation on Fundamental Changes......................................................... 21
ARTICLE VII PURCHASE TERMINATION EVENTS...................................................................... 21
Section 7.01. Purchase Termination Events............................................................... 21
Section 7.02. Remedies.................................................................................. 23
ARTICLE VIII MISCELLANEOUS................................................................................... 24
Section 8.01. Payments.................................................................................. 24
Section 8.02. Costs and Expenses........................................................................ 24
Section 8.03. Successors and Assigns.................................................................... 25
Section 8.04. No Waiver; Cumulative Remedies............................................................ 26
Section 8.05. Amendments and Waivers.................................................................... 26
Section 8.06. Severability.............................................................................. 26
Section 8.07. Notices................................................................................... 26
Section 8.08. Counterparts.............................................................................. 26
Section 8.09. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.............................. 26
Section 8.10. Addition of Originators................................................................... 28
Section 8.11. Termination of Originators................................................................ 28
Section 8.12. No Bankruptcy Petition.................................................................... 30
Section 8.13. Termination............................................................................... 30
Section 8.14. Complete Agreement; Modification of Agreement............................................. 30
Section 8.15. Section Titles............................................................................ 30
Section 8.16. No Setoff................................................................................. 30
Section 8.17. Confidentiality........................................................................... 30
Section 8.18. Further Assurances........................................................................ 31
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INDEX OF APPENDICES
Exhibit 2.01(a) Form of Receivables Assignment
Exhibit 2.01(c) Form of Subordinated Note
Exhibit 2.03 Form of Parent Agreement
Exhibit 3.05 Form of Additional Originator Supplement
Schedule 4.01(p) Lockbox Accounts
Schedule 4.01(q) Jurisdiction of Organization; Executive Offices; Collateral Locations;
Schedule 4.01(s) Other Names
Schedule 8.07 Notice Addresses
Annex X Definitions
Annex Y Schedule of Documents
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THIS RECEIVABLES SALE AGREEMENT (as amended, supplemented or
otherwise modified and in effect from time to time, this "Agreement") is entered
into as of July 29, 2004, by and among each of the persons signatory hereto from
time to time as Originators (each an "Originator" and, collectively, the
"Originators"), ▇▇▇▇▇▇ MICRO INC., a Delaware corporation ("▇▇▇▇▇▇ Micro"), and
▇▇▇▇▇▇ FUNDING INC., a Delaware corporation company ("Buyer").
RECITALS
A. The Buyer is a direct Subsidiary of ▇▇▇▇▇▇ Micro.
B. Buyer intends to purchase Receivables originated by each
Originator and other Receivable Assets related thereto and to finance such
Receivables and other Receivable Assets under the Funding Agreement.
C. Each Originator intends to sell, and Buyer intends to
purchase, such Receivables and other Receivable Assets related thereto, from
time to time, as described herein.
D. In addition, ▇▇▇▇▇▇ Micro may, from time to time, contribute
capital to Buyer in the form of Contributed Receivables and other Receivable
Assets related thereto or cash.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter contained, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01. Definitions. Capitalized terms used and not otherwise
defined herein shall have the meanings ascribed to them in Annex X.
Section 1.02. Rules of Construction. For purposes of this Agreement, the
rules of construction set forth in Annex X shall govern. All Appendices hereto,
or expressly identified to this Agreement, are incorporated herein by reference
and, taken together with this Agreement, shall constitute but a single
agreement.
ARTICLE II
TRANSFERS OF RECEIVABLES
Section 2.01. Agreement to Transfer.
(a) Receivables Transfers. Subject to the terms and conditions hereof,
each Originator agrees to sell (without recourse except to the limited extent
specifically provided herein) or, in the case of ▇▇▇▇▇▇ Micro, sell or
contribute, to Buyer on the Effective Date and on each Business Day thereafter
until the occurrence of the Termination Date (each such date
(including the Effective Date), a "Transfer Date"), all Receivables and other
Receivable Assets related thereto owned by it as of the close of business on the
immediately preceding Business Day, and Buyer agrees to purchase or acquire as a
capital contribution all such Receivables and other Receivable Assets on the
Effective Date and each such Transfer Date. All such Transfers by an Originator
to Buyer shall collectively be evidenced by a single certificate of assignment
between such Originator and Buyer substantially in the form of Exhibit 2.01(a)
(each such certificate of assignment, a "Receivables Assignment"), and each
Originator and Buyer shall execute and deliver such Receivables Assignment on or
before the Effective Date (or, in the case of an Originator that becomes a party
hereto after the Effective Date, on or before the relevant Originator Addition
Date).
(b) Determination of Sold Receivables. On and as of each Transfer Date,
(i) all Receivables and other Receivable Assets owned by each Originator (other
than ▇▇▇▇▇▇ Micro) as of the close of business on the immediately preceding
Business Day and not previously acquired by Buyer shall be identified for sale
to Buyer, and (ii) to the extent Receivables and other Receivable Assets owned
by ▇▇▇▇▇▇ Micro as of the close of business on the immediately preceding
Business Day have not been contributed to Buyer in accordance with Section
2.01(d), such Receivables and other Receivable Assets shall be identified for
sale to Buyer (each such Receivable identified for sale pursuant to clauses (i)
and (ii) above, individually, a "Sold Receivable" and, collectively, the "Sold
Receivables"). The Sold Receivables will be identified by reference to the
General Trial Balance of each Originator.
(c) Payment of Sale Price. In consideration for each Sale of Sold
Receivables and other Receivable Assets hereunder, Buyer shall pay to the
Originator thereof on the Transfer Date therefor the Sale Price therefor in
Dollars in immediately available funds (except as set forth in the second
succeeding sentence or as provided in subsection (d) below). All cash payments
by Buyer under this Section 2.01(c) shall be effected by means of a wire
transfer on the day when due to such account or accounts as the Originators may
designate from time to time. To the extent that the Sale Price of Sold
Receivables and other Receivable Assets exceeds the amount of cash then
available to Buyer, the applicable Originator hereby agrees to make a
subordinated loan (each, a "Subordinated Loan") to Buyer in an amount up to the
amount of such excess in satisfaction of the equivalent portion of the Sale
Price not paid in cash; provided, that in no event shall the aggregate amount of
all Subordinated Loans outstanding at any time from all Originators exceed
twenty percent (20%) of the aggregate Outstanding Balance of Transferred
Receivables at such time. The Subordinated Loans made by each Originator shall
be evidenced by a subordinated promissory note substantially in the form of
Exhibit 2.01(c) hereto (each, a "Subordinated Note") executed by Buyer. The
Subordinated Loans shall bear interest and be payable as provided in the
applicable Subordinated Note.
(d) Determination of Contributed Receivables. On each Transfer Date,
▇▇▇▇▇▇ Micro shall identify Receivables and other Receivable Assets related
thereto then owned by ▇▇▇▇▇▇ Micro which have not been previously acquired by
Buyer or identified for sale to Buyer pursuant to clause (b) above, and shall,
prior to the delivery of an Election Notice, contribute such Receivables and
other Receivable Assets related thereto as a capital contribution to the Buyer
(each such contributed Receivable individually, a "Contributed Receivable," and
collectively, the "Contributed Receivables"), to the extent Buyer cannot pay the
Sale Price therefor first, in cash or second, through Subordinated Loans
pursuant to the foregoing clauses (b) and (c).
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Notwithstanding the foregoing, ▇▇▇▇▇▇ Micro shall not be obligated to make
additional contributions to Buyer at any time. If on any Transfer Date (i)
▇▇▇▇▇▇ Micro elects not to contribute Receivables and other Receivable Assets to
Buyer, or (ii) any Originator (other than ▇▇▇▇▇▇ Micro) elects not to sell all
of its then owned Receivables and other Receivable Assets to Buyer, ▇▇▇▇▇▇ Micro
or such Originator, as applicable, shall deliver to Buyer not later than 5:00
p.m. (New York time) on such Transfer Date a notice of election thereof (each
such notice, an "Election Notice").
(e) Ownership of Transferred Receivables and other Receivable Assets. On
and after each Transfer Date and after giving effect to the Transfers to be made
on each such date, Buyer shall own the Transferred Receivables and other
Receivable Assets and no Originator shall take any action inconsistent with such
ownership nor shall any Originator claim any ownership interest in such
Transferred Receivables and other Receivable Assets.
(f) Reconstruction of General Trial Balance. If at any time any
Originator fails to generate its General Trial Balance, Buyer shall have the
right to reconstruct such General Trial Balance so that a determination of the
Sold Receivables and Contributed Receivables can be made pursuant to Section
2.01(b). Each Originator agrees to cooperate with such reconstruction, including
by delivery to Buyer, upon Buyer's request, of copies of all applicable
Contracts and Records.
(g) Servicing of Receivables. So long as no Event of Servicer
Termination shall have occurred and be continuing and no Successor Servicer has
assumed the responsibilities and obligations of the Servicer pursuant to Section
11.02 of the Funding Agreement, the Servicer shall (i) conduct the servicing,
administration and collection of the Transferred Receivables and other
Receivable Assets and shall take, or cause to be taken, all such actions as may
be necessary or advisable to service, administer and collect the Transferred
Receivables and other Receivable Assets, all in accordance with the terms of the
Funding Agreement and the Credit and Collection Policy, and (ii) hold all
Contracts and other documents and incidents relating to the Transferred
Receivables and other Receivable Assets in trust for the benefit of Buyer, as
the owner thereof, and for the sole purpose of facilitating the servicing of the
Transferred Receivables and other Receivable Assets in accordance with the terms
of the Funding Agreement.
(h) Marking of Records. In connection with the sales and contributions
contemplated hereby, each Originator agrees at its own expense, with respect to
the Receivables and any other similar receivables originated by such Originator
that it will, as agent of the Buyer, (i) on or prior to the Effective Date and
thereafter, indicate or cause to be indicated on the computer files and other
physical records (but not including individual invoices or individual collection
files) relating to such Receivables (by means of a general legend that will
automatically appear at or near the beginning of any screen, list or print-out
of such Receivables) that, unless otherwise specifically identified on such
screen, list or print-out as a receivable not so sold or contributed, all
Receivables included in such screen, list or print-out have been sold or
contributed to the Buyer in accordance with this Agreement and (ii) deliver or
transmit or cause to be delivered or transmitted to the Buyer and the Lender a
computer tape, diskette or data transmission containing a complete list of all
Receivables transferred to the Buyer specifying for each such Receivable, as of
a date no later than the Effective Date and as of such other dates as Buyer or
Lender shall designate, which date, in the absence of the occurrence and
continuance of a Termination Event,
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shall not occur more often than annually (each such date, a "Subsequent Cut-Off
Date"), at least (A) the name of the Obligor and (B) the Outstanding Balance of
the Receivables owing by such Obligor.
Section 2.02. Grant of Security Interest. The parties hereto intend that
each Transfer shall constitute a purchase and sale or capital contribution, as
applicable, and not a loan. Notwithstanding the foregoing, in addition to and
not in derogation of any rights now or hereafter acquired by Buyer under Section
2.01 hereof, the parties hereto intend that this Agreement shall constitute a
security agreement under applicable law and if a court of competent jurisdiction
determines that any transaction provided for herein constitutes a loan and not a
sale or capital contribution, as applicable, that each Originator shall be
deemed to have granted, and each Originator does hereby grant, to Buyer a
continuing security interest in all of such Originator's right, title and
interest in, to and under the Receivables and other Receivable Assets whether
now owned or hereafter acquired by such Originator to secure the obligations of
such Originator to Buyer hereunder (including, if and to the extent that any
Transfer is recharacterized as a transfer for security under applicable law, the
repayment of a loan deemed to have been made by Buyer to the applicable
Originator in the amount of the Sale Price with respect to such recharacterized
Transfer).
Section 2.03. Parent Agreement. ▇▇▇▇▇▇ Micro hereby undertakes and agrees,
to and for the benefit of Buyer, to cause the due and punctual performance and
observance by each Originator (other than ▇▇▇▇▇▇ Micro) of all of the terms,
conditions, agreements and undertakings on the part of such Originator to be
performed or observed by it hereunder or under any other Related Document and,
in connection therewith, shall execute and deliver to Buyer on the first
Originator Addition Date, an agreement substantially in the form of Exhibit 2.03
(the "Parent Agreement"), to more fully evidence such undertaking.
Section 2.04. Originators Remain Liable. It is expressly agreed by the
Originators that, anything herein to the contrary notwithstanding, each
Originator shall remain liable to the Obligor (and any other party to the
related Contract) under any and all of the Receivables originated by it and
other Receivable Assets related thereto and under the Contracts therefor to
observe and perform all the conditions and obligations to be observed and
performed by it thereunder. Buyer shall not have any obligation or liability to
the Obligor or any other party to the related Contract under any such
Receivables and other Receivable Assets or Contracts by reason of or arising out
of this Agreement or the granting herein of a Lien thereon or the receipt by
Buyer of any payment relating thereto pursuant hereto. The exercise by Buyer of
any of its rights under this Agreement shall not release any Originator from any
of its respective duties or obligations under any such Receivables and other
Receivable Assets or Contracts. Buyer shall not be required or obligated in any
manner to perform or fulfill any of the obligations of any Originator under or
pursuant to any such Receivable and other Receivable Assets or Contract, or to
make any payment, or to make any inquiry as to the nature or the sufficiency of
any payment received by it or the sufficiency of any performance by any party
under any such Receivable and other Receivable Assets or Contract, or to present
or file any claims, or to take any action to collect or enforce any performance
or the payment of any amounts that may have been assigned to it or to which it
may be entitled at any time or times.
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Section 2.05. Rebates, Adjustments, Returns, Reductions and Modifications.
From time to time each Originator may make Dilution Adjustments to Receivables
in accordance with this Section 2.05 and Section 6.02. Each Originator agrees to
pay to the Buyer, on the Settlement Date immediately succeeding the date on
which any Dilution Adjustment is granted or made, the amount of any such
Dilution Adjustment (a "Dilution Adjustment Payment"). The amount of any
Dilution Adjustment shall be set forth on the first Borrowing Base Certificate
prepared after the date on which such Dilution Adjustment was granted or made.
Section 2.06. Payments in Respect of Ineligible Receivables and Originator
Indemnification Payments. (a) Originator Adjustment Payments. If (i) any
representation or warranty under Sections 4.02(a) or (b) is not true and correct
as of the date specified therein with respect to any Receivable sold to the
Buyer or any Receivable encompassed by the representation or warranty under
Section 4.02(c) hereof is determined not to be an Eligible Receivable as of its
date of purchase, (ii) there is a breach of any covenant under Section 6.01
hereof with respect to any Receivable or (iii) the Buyer's interest in any
Receivable is not a first priority perfected ownership or security interest at
any time as a result of any action taken by, or the failure to take action by,
the applicable Originator (each event referred to in clauses (i), (ii) and (iii)
of this Section 2.06(a) shall be referred to herein as an "Ineligibility Event"
and any Receivable as to which an Ineligibility Event applies shall be referred
to herein as an "Ineligible Receivable"), then the Originator that originated
such Receivable agrees to pay to the Buyer, upon the request of the Buyer or the
Originator obtaining knowledge of such Ineligibility Event, an amount (the
"Adjustment Amount") equal to the Outstanding Balance of such Receivable as of
the date such Receivable was conveyed to the Buyer hereunder (whether the Buyer
paid the related Sale Price in cash or otherwise) less Collections received by
the Buyer in respect of the principal amount of such Receivable. Such payment
shall be made on or prior to the 30th day after the day the Buyer requests such
payment or the applicable Originator obtains knowledge that such payment is due
(except that if such day is not a Business Day, then such payment shall be made
on the Business Day immediately succeeding such day); provided that in the event
that a Purchase Termination Event with respect to such Originator has occurred
and is continuing, such Originator shall make such payment immediately upon the
Buyer's request for such payment or such Originator obtaining knowledge that
such payment is due. Any payment by any Originator pursuant to this Section
2.06(a) is referred to as an "Originator Adjustment Payment". If, on or prior to
such 30th day (or the Business Day immediately succeeding such 30th day, as
applicable), an Originator shall make an Originator Adjustment Payment in
respect of any such Ineligible Receivable, then the Buyer shall have no further
remedy against such Originator in respect of the Ineligibility Event with
respect to such Receivable. Upon payment of an Originator Adjustment Payment,
the Buyer shall automatically agree to pay to the applicable Originator all
Collections received with respect to such Ineligible Receivable.
(b) Special Indemnification. In addition to its obligations under
Section 8.02 hereof, each Originator agrees to pay, indemnify and hold harmless
the Buyer and its successors and assigns from any loss, liability, expense,
damage or injury which may at any time be imposed on, incurred by or asserted
against the Buyer in any way relating to or arising out of (i) any Eligible
Receivable originated by such Originator becoming subject to any defense,
dispute, offset or counterclaim of any kind (other than as expressly permitted
by this Agreement or the Funding Agreement) or (ii) such Originator breaching
any covenant applicable to it contained in Section 5.02, 5.08, 5.09, 5.10, 5.14,
6.01, 6.02, 6.03, 6.04, 6.05, 6.09 or 6.10 with respect to any
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Receivable originated by it (each of the foregoing events or circumstances being
an "Originator Indemnification Event"), and such Receivable (or a portion
thereof) ceasing to be an Eligible Receivable on the date on which such
Originator Indemnification Event occurs. The amount of such indemnification
shall be equal to the Outstanding Balance of such Receivable on the date it was
conveyed to the Buyer hereunder (whether the Company paid the related Sale Price
in cash or otherwise) less Collections received by the Buyer in respect of the
principal amount of such Receivable. Such payment shall be made on or prior to
the 30th Business Day after the day the Buyer requests such payment or the
applicable Originator obtains knowledge that such payment is due unless such
Originator Indemnification Event shall have been cured on or before such 30th
Business Day; provided, however, that in the event that a Purchase Termination
Event with respect to such Originator has occurred and is continuing, such
Originator shall make such payment immediately. If, on or prior to such 30th
Business Day, the applicable Originator shall make such payment, then the Buyer
shall have no further remedy against such Originator in respect of such
Originator Indemnification Event. Any payment by an Originator pursuant to this
Section 2.06(b) is referred to as an "Originator Indemnification Payment". Upon
payment of an Originator Indemnification Payment, the Buyer shall automatically
agree to pay to such Originator all Collections with respect to the Receivable
in respect of which an Originator Indemnification Payment is made.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.01. Conditions Precedent to the Buyer's Purchase of Receivables
and other Receivable Assets on the Effective Date. The obligation of the Buyer
to purchase from each Originator the Receivables and other Receivable Assets on
the Effective Date is subject to the conditions precedent, which may be waived
by the Buyer, that (a) this Agreement and each Subordinated Note shall be in
full force and effect and (b) the conditions set forth below shall have been
satisfied on or before the Effective Date:
(i) the Buyer shall have received copies of duly adopted
resolutions of the Board of Directors or other governing body of each
Originator, as in effect on the Effective Date, authorizing the
transactions contemplated hereby, certified by the Secretary or Assistant
Secretary of such Originator;
(ii) the Buyer shall have received duly executed certificates of
the Secretary or an Assistant Secretary of each Originator, dated the
Effective Date, and in form and substance reasonably satisfactory to the
Buyer, certifying the names and true signatures of the officers authorized
on behalf of such Originator to sign this Agreement and any instruments or
documents in connection with this Agreement;
(iii) each Originator shall have filed, at its own expense, UCC-1
financing statements with respect to the Receivables originated by such
Originator and other Receivable Assets related thereto in such manner and
in such jurisdictions as are necessary to perfect the Buyer's ownership
interest therein under the UCC and delivered evidence of such filings to
the Buyer; and all other action necessary, in the reasonable judgment of
the Buyer, to perfect under the UCC (to the extent applicable) the Buyer's
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ownership of the Transferred Receivables originated by such Originator and
other Receivable Assets related thereto shall have been duly taken;
(iv) each Originator shall have delivered or transmitted to the
Buyer, with respect to the Receivables originated by such Originator, a
computer tape, diskette or data transmission reasonably acceptable to the
Buyer showing, as of a date no later than the Effective Date, such
information as the Buyer shall reasonably request relating to all
Receivables to be transferred by such Originator to the Buyer on or prior
to the Effective Date;
(v) the Buyer shall have received reports of UCC-1 and other
searches of each Originator with respect to the Receivables originated by
such Originator and other Receivable Assets related thereto reflecting the
absence of Adverse Claims thereon, except for Permitted Liens and Liens as
to which the Buyer has received UCC termination statements;
(vi) the Buyer shall be satisfied that each Originator's systems,
procedures and record keeping relating to the Receivables originated by
such Originator are sufficient and satisfactory in order to permit the
purchase and administration of such Receivables in accordance with the
terms and intent of this Agreement;
(vii) a Lockbox Account shall have been established in the name of
the Buyer and all Obligors with respect to Transferred Receivables shall
have been directed to remit all payments with respect to such Transferred
Receivables to the related Lockbox; and
(viii) the Buyer shall have received such other approvals, opinions
or documents as the Buyer may reasonably request.
Section 3.02. Conditions Precedent to All Transfers. The obligation of the
Buyer to purchase any Receivable and other Receivable Assets on each Transfer
Date (including the Effective Date) shall be subject to the further conditions
precedent, which, other than conditions precedent relating to Purchase
Termination Events set forth in Section 7.01(g) or (h), may be waived by the
Buyer, that, on and as of such Transfer Date, the following statements shall be
true (and the acceptance by each Originator of the Sale Price for such
Receivable and other Receivable Assets on such Transfer Date shall constitute a
representation and warranty by such Originator that on such Transfer Date the
statements in clauses (i) and (ii) below are true):
(i) the representations and warranties of each Originator
contained in Sections 4.01 and 4.02 shall be true and correct on and as of
such Transfer Date as though made on and as of such date, except insofar
as such representations and warranties are expressly made only as of
another date (in which case they shall be true and correct as of such
other date);
(ii) after giving effect to such purchase, no Purchase Termination
Event or Potential Purchase Termination Event (including, without
limitation, any event set forth in Section 7.01 (d)(ii)(A)) with respect
to the applicable Originator shall have occurred and be continuing;
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(iii) after giving effect to such purchase, no Termination Event or
Incipient Termination Event shall have occurred and be continuing; and
(iv) the Buyer shall have received such other approvals, opinions
or documents as the Buyer may reasonably request; provided, however, that
the failure of the applicable Originator to satisfy any of the foregoing
conditions shall not prevent such Originator from subsequently selling
Receivables originated by it and other Receivable Assets related thereto
upon satisfaction of all such conditions.
Section 3.03. Conditions Precedent to Each Originator's Obligations on the
Effective Date. The obligations of each Originator on the Effective Date shall
be subject to the conditions precedent, which may be waived by such Originator,
that such Originator shall have received on or before the Effective Date the
following, each dated the Effective Date and in form and substance satisfactory
to such Originator:
(i) a copy of duly adopted resolutions of the Board of Directors
of the Buyer authorizing the transactions contemplated hereby, certified
by the Secretary or Assistant Secretary of the Buyer; and
(ii) a duly executed certificate of the Secretary or Assistant
Secretary of the Buyer certifying the names and true signatures of the
officers or authorized representatives authorized on its behalf to sign
this Agreement and the other documents to be delivered by it hereunder.
Section 3.04. Conditions Precedent to All of Each Originator's
Obligations. The obligation of each Originator to sell any Receivable and other
Receivable Assets on any Transfer Date (including on the Effective Date) shall
be subject to the further conditions precedent, which may be waived by such
Originator, that, on the such Transfer Date, the following statement shall be
true (and the payment by the Buyer of the Sale Price for such Receivable and
other Receivable Assets on such Transfer Date shall constitute a representation
and warranty by the Buyer on such Transfer Date that the statement in clause
(ii) below is true): after giving effect to such purchase, (i) no Purchase
Termination Event set forth in Section 7.01(d) hereof shall have occurred and be
continuing, and (ii) no Termination Event set forth in Section 9.01(d) of the
Funding Agreement (as in effect on the date hereof and without giving effect to
any amendment or supplement to, or modification or waiver of, or departure from,
such paragraph unless, in each case, such Originator shall have consented
thereto) shall have occurred and be continuing.
Section 3.05. Condition Precedent to the Addition of an Originator. No
direct or indirect Subsidiary approved by the Buyer as an additional Originator
pursuant to Section 8.10 hereof shall be added as an Originator hereunder unless
the conditions set forth below shall have been satisfied on or before the date
designated for the addition of such Originator (the "Originator Addition Date"):
(i) the Buyer shall have received an executed copy of a supplement
substantially in the form of Exhibit 3.05 hereto (each such supplement, an
"Additional Originator Supplement"), duly executed and delivered by such
Originator;
8
(ii) the Buyer shall have received copies of duly adopted
resolutions of the Board of Directors of such Originator, as in effect on
the related Originator Addition Date, authorizing this Agreement, the
other documents to be delivered by such Originator hereunder and the
transactions contemplated hereby and thereby, certified by the Secretary
or Assistant Secretary of such Originator;
(iii) the Buyer shall have received duly executed certificates of
the Secretary or an Assistant Secretary of such Originator, dated the
related Originator Addition Date, and in form and substance reasonably
satisfactory to the Buyer, certifying the names and true signatures of the
officers authorized on behalf of such Originator to sign the Additional
Originator Supplement or any instruments or documents in connection with
this Agreement;
(iv) a Lockbox Account with respect to Receivables to be sold by
such Originator shall have been established in the name of the Buyer, or
such Originator shall have become a party to an agreement governing an
existing Lockbox Account pursuant to which such Originator shall transfer
ownership of such Lockbox Account to the Buyer, and all Obligors with
respect to such Receivables shall have been directed to remit payments
with respect to such Receivables to such Lockbox Account or the related
Lockbox;
(v) such Originator shall have filed and recorded, at its own
expense, UCC-1 financing statements (and other similar instruments) with
respect to the Receivables and other Receivable Assets originated by such
Originator in such manner and in such jurisdictions as are necessary to
perfect the Buyer's ownership interest thereof under the UCC and delivered
evidence of such filings to the Buyer on or prior to the related
Originator Addition Date; and all other action necessary, in the
reasonable judgment of the Buyer, to perfect the Buyer's ownership of the
Transferred Receivables and other Receivable Assets originated by such
Originator shall have been duly taken;
(vi) such Originator shall have delivered or transmitted to the
Buyer, with respect to the Receivables originated by it, a computer tape,
diskette or data transmission reasonably acceptable to the Buyer showing,
as of a date no later than five Business Days preceding the related
Originator Addition Date, such information relating to all Receivables to
be transferred by such Originator to the Buyer on the related Originator
Addition Date as the Buyer shall request;
(vii) the Buyer shall have received reports of UCC-1 and other
searches of such Originator with respect to the Receivables and other
Receivable Assets originated by such Originator reflecting the absence of
Adverse Claim thereon, except for (i) Permitted Liens and (ii) Liens as to
which the Buyer has received UCC termination statements to be filed on or
prior to the related Originator Addition Date;
(viii) the Buyer shall be satisfied that such Originator's systems,
procedures and record keeping relating to the Transferred Receivables
originated by such Originator and other Receivable Assets related thereto
are sufficient and satisfactory in order to permit
9
the purchase and administration of such Transferred Receivables and other
Receivable Assets in accordance with the terms and intent of this
Agreement;
(ix) such Originator shall have delivered to the Buyer a duly
executed copy of a Receivables Assignment;
(x) in the case of the first Originator Addition Date, ▇▇▇▇▇▇
Micro shall have delivered to the Buyer and the Lender a duly executed
copy of the Parent Agreement;
(xi) the prior written consent of the Lender shall have been
obtained; and
(xii) the Buyer shall have received such other approvals, opinions
or documents as the Buyer may reasonably request from such Originator.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.01. Representations and Warranties of the Originators. ▇▇▇▇▇▇
Micro as to itself and, where provided, its Significant Subsidiaries, and each
other Originator as to itself only, represents and warrants as follows:
(a) Organization; Powers. It (i) is a corporation, business trust or
limited partnership, as applicable, duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization, (ii) has all
requisite power and authority to own its property and assets and to carry on its
business as now conducted and as proposed to be conducted, (iii) is qualified to
do business in, and is in good standing in, every jurisdiction where the nature
of its business so requires, except where the failure so to qualify could not
reasonably be expected to result in an Originator Material Adverse Effect and
(iv) has the corporate, trust or limited partnership, as applicable, power and
authority to execute, deliver and perform its obligations under each of the
Related Documents and each other agreement or instrument contemplated hereby or
thereby to which it is or will be a party.
(b) Authorization. The execution, delivery and performance by such
Originator of each of the Related Documents to which such Originator is a party
and the performance of the transactions contemplated hereby and thereby
(collectively, the "Transactions") (i) have been duly authorized by all
requisite corporate, trust or partnership action, as applicable, and, if
required, stockholder action and (ii) will not (A) violate (1) any Requirement
of Law applicable to such Originator or (2) any provision of any Related
Document or other material Contractual Obligation to which it is a party or by
which any of them or any of their property is or may be bound, (B) be in
conflict with, result in a breach of or constitute (alone or with notice or
lapse of time or both) a default under, or give rise to any right to accelerate
or to require the prepayment, repurchase or redemption of any obligation under,
any Related Document or any other material Contractual Obligation except where
any such conflict, violation, breach or default referred to in clause (A) or
(B), individually or in the aggregate, could not reasonably be expected to have
an Originator Material Adverse Effect or (C) result in the creation or
imposition of any Lien upon the Transferred Receivables or other Receivable
Assets (other than Permitted Liens and any Lien created hereunder or
contemplated or permitted hereby).
10
(c) Enforceability. This Agreement has been duly executed and delivered
by such Originator and constitutes, and each other Related Document to which
such Originator is a party when executed and delivered by such Originator will
constitute, a legal, valid and binding obligation of such Originator enforceable
against such Originator in accordance with its terms, subject to (i) applicable
bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the enforcement of creditors' rights generally, from time to time in
effect, and (ii) general principles of equity (whether enforcement is sought by
a proceeding in equity or at law).
(d) Governmental Approvals. No action, consent or approval of,
registration or filing with, or any other action by, any Governmental Authority
is or will be required in connection with the Transactions, except for (i) the
filing of UCC financing statements, (ii) such actions, consents, approvals,
registrations and filings as have been made or obtained and are in full force
and effect and (iii) such actions, consents, approvals and filings the failure
of which to obtain or make could not reasonably be expected to result in an
Originator Material Adverse Effect.
(e) Litigation; Compliance with Laws. There are no actions, suits or
proceedings at law or in equity or by or before any Governmental Authority now
pending or, to the knowledge of such Originator, threatened against such
Originator or any Significant Subsidiary in respect of which there exists a
reasonable possibility of an outcome that would result in an Originator Material
Adverse Effect.
(f) Judgments. Neither such Originator nor any Significant Subsidiary is
in default with respect to any judgment, writ, injunction, decree or order of
any Governmental Authority, where such violation or default could reasonably be
expected to result in an Originator Material Adverse Effect.
(g) Agreements. Neither such Originator nor any Significant Subsidiary
is a party to any agreement or instrument or subject to any corporate
restriction that has resulted or could reasonably be expected to result in an
Originator Material Adverse Effect.
(h) Contractual Obligations. Neither such Originator nor any Significant
Subsidiary is in default in any manner under any provision of any Contractual
Obligation to which it is a party or by which it or any of its properties or
assets are bound, where such default could reasonably be expected to result in
an Originator Material Adverse Effect.
(i) Federal Reserve Regulations. Neither such Originator nor any
Significant Subsidiary is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of buying or
carrying Margin Stock.
(j) Use of Proceeds. No part of the proceeds from the sale of
Receivables and other Receivable Assets hereunder will be used, whether directly
or indirectly, and whether immediately, incidentally or ultimately, for any
purpose that entails a violation of, or that is inconsistent with, the
provisions of the Regulations of the Board, including Regulation U or Regulation
X.
(k) Investment Company Act. Such Originator is not an "investment
company" as defined in, or subject to regulation under, the Investment Company
Act or any successor statute thereto.
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(l) Tax Returns. Such Originator and each Significant Subsidiary has
filed or caused to be filed all material tax returns (Federal, State and local)
and has paid or caused to be paid or made adequate provision for all taxes due
and payable by it and all assessments received by it, except to the extent that
such failure to file or nonpayment (i) is being contested in good faith or (ii)
could reasonably be expected to result in an Originator Material Adverse Effect.
(m) Employee Benefit Plans. Except to the extent failure to comply could
not reasonably be expected to result in an Originator Material Adverse Effect,
such Originator and its ERISA Affiliates are in compliance in all material
respects with the applicable provisions of ERISA and the IRC and the regulations
and published interpretations thereunder. No Reportable Event has occurred or is
reasonably expected to occur that, when taken together with all other such
Reportable Events, could reasonably be expected to result in an Originator
Material Adverse Effect.
(n) Accounting Treatment. Such Originator will not prepare any financial
statements that shall account for the transactions contemplated hereby, nor will
it in any other respect (other than for tax purposes) account for the
transactions contemplated hereby, in a manner that is inconsistent with the
Buyer's ownership interest in the Transferred Receivables and other Receivable
Assets.
(o) Indebtedness to Buyer. Immediately prior to consummation of the
transactions contemplated hereby on the Effective Date, such Originator had no
outstanding Debt to the Buyer other than amounts permitted by this Agreement.
(p) Lockboxes. Set forth in Schedule 4.01(p) hereto is a complete and
accurate description as of the Effective Date of each Lockbox Account currently
maintained by such Originator. Each of the Lockbox Account Agreements is the
valid and binding agreement of such Originator, enforceable against such
Originator in accordance with its terms subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting the
enforcement of creditors' rights generally, from time to time in effect and to
general principles of equity (whether enforcement is sought by a proceeding in
equity or at law).
(q) Chief Executive Office; Jurisdiction of Organization. The offices at
which such Originator keeps its records concerning the Transferred Receivables
originated by it and other Receivable Assets related thereto either (x) are
located as set forth on Schedule 4.01(q) hereto or (y) are in locations as to
which such Originator has notified the Buyer in accordance with Section 5.06
hereof. The chief executive office and jurisdiction of organization of such
Originator are listed opposite its name on Schedule 4.01(q), and neither the
location of such chief executive office nor such jurisdiction of organization
has changed in the past four months.
(r) Bulk Sales Act. No transaction contemplated hereby with respect to
such Originator requires compliance with, or will be subject to avoidance under,
any bulk sales act or similar law.
(s) Names. The legal name of such Originator is as set forth in this
Agreement. It has no trade names, fictitious names, assumed names or "doing
business as" names except as set forth on Schedule 4.01(s).
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(t) Solvency. No Insolvency Event with respect to such Originator has
occurred and the sale of the Receivables and other Receivable Assets by it to
the Buyer has not been made in contemplation of the occurrence thereof. Both
prior to and after giving effect to the transactions occurring on the Effective
Date and after giving effect to each subsequent transaction contemplated
hereunder, (i) the fair value of the assets of such Originator at a fair
valuation will exceed the debts and liabilities, subordinated, contingent or
otherwise, of such Originator; (ii) the present fair salable value of the
property of such Originator will be greater than the amount that will be
required to pay the probable liability of such Originator on its debts and other
liabilities, subordinated, contingent or otherwise, as such debts and other
liabilities become absolute and matured; (iii) such Originator will be able to
pay its debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (iv) such Originator will
not have unreasonably small capital with which to conduct the business in which
it is engaged as such business is now conducted and is proposed to be conducted.
For all purposes of clauses (i) through (iv) above, the amount of contingent
liabilities at any time shall be computed as the amount that, in the light of
all the facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured liability. Such
Originator does not intend to, nor does it believe that it will, incur debts
beyond its ability to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it and the timing of the amounts
of cash to be payable on or in respect of its Indebtedness.
(u) No Purchase Termination Event. As of the Effective Date, no Purchase
Termination Event or Potential Purchase Termination Event with respect to such
Originator has occurred and is continuing.
(v) No Fraudulent Transfer. Such Originator is not entering into this
Agreement with the intent (whether actual or constructive) to hinder, delay, or
defraud its present or future creditors and is receiving reasonably equivalent
value and fair consideration for the Receivables and other Receivable Assets
originated by it being transferred hereunder.
(w) Collection Procedures. Such Originator has in place procedures which
are either necessary or advisable to facilitate the timely collection of
Receivables originated by it.
(x) Fair Value. With respect to each Transferred Receivable and other
Receivable Assets acquired by the Buyer hereunder, the Buyer has purchased such
Transferred Receivable and other Receivable Assets from such Originator in
exchange for payment in an amount which constitutes fair consideration and
approximates fair market value for such Transferred Receivable and other
Receivable Assets and in a sale the terms and conditions of which (including,
without limitation, the purchase price thereof) reasonably approximate an
arm's-length transaction between unaffiliated parties. Each sale by such
Originator to the Buyer of a Transferred Receivable and other Receivable Assets
has been made for "reasonably equivalent value" (as such term is used in Section
548 of the Bankruptcy Code) and not for or on account of an "antecedent debt"
(as such term is used in Section 547 of the Bankruptcy Code) owed by such
Originator to the Buyer.
The representations and warranties described in this Section 4.01 shall survive
the Transfer of the Transferred Receivables and other Receivable Assets to
Buyer, any subsequent assignment of
13
the Transferred Receivables and other Receivable Assets by Buyer, and the
termination of this Agreement and the other Related Documents and shall continue
until the indefeasible payment in full of all Transferred Receivables.
Section 4.02. Representations and Warranties of the Originators Relating
to the Receivables and other Receivable Assets. Each Originator hereby
represents and warrants to the Buyer on each Transfer Date that with respect to
the Receivables and other Receivable Assets originated by it being paid for as
of such date:
(a) Receivables Description. As of the Effective Date and each
Subsequent Cut-Off Date, the computer tape, diskette or data transmission
delivered or transmitted pursuant to Section 2.01(h) sets forth in all material
respects an accurate and complete listing of all Receivables conveyed to the
Buyer on or before the Effective Date or such Subsequent Cut-Off Date, as the
case may be, and the information contained therein with respect to each such
Receivable is true and correct as of the Effective Date or such Subsequent
Cut-Off Date, as applicable. As of the Effective Date and each Subsequent
Cut-Off Date, the aggregate amount of Receivables owned by such Originator is
accurately set forth on such computer tape, diskette or data transmission.
(b) No Adverse Claims. Each Receivable and other Receivable Assets
existing on the Effective Date or, in the case of Receivables and other
Receivable Assets transferred to the Buyer after the Effective Date, on the
applicable Transfer Date, has been conveyed to the Buyer free and clear of any
Adverse Claims, except for Permitted Liens.
(c) Eligible Receivables. On the Effective Date, each Receivable
identified in the Borrowing Base Certificate delivered on the Effective Date as
an Eligible Receivable transferred to the Buyer is an Eligible Receivable on the
Effective Date and, in the case of Receivables transferred to the Buyer after
the Effective Date, each such Receivable that is identified in a Borrowing Base
Certificate or a Monthly Report as an Eligible Receivable transferred to the
Buyer on such later date is an Eligible Receivable on such later date.
(d) Filings. All filings and other acts necessary (including but not
limited to all filings and other acts necessary or advisable under the UCC)
shall have been made or performed in order to grant the Buyer a first priority
perfected ownership or security interest in respect of all Transferred
Receivables and other Receivable Assets.
The representations and warranties described in this Section 4.02 shall survive
the Transfer of the Transferred Receivables and other Receivable Assets to
Buyer, any subsequent assignment of the Transferred Receivables and other
Receivable Assets by Buyer, and the termination of this Agreement and the other
Related Documents and shall continue until the indefeasible payment in full of
all Transferred Receivables.
Section 4.03. Representations and Warranties of the Buyer. The Buyer
represents and warrants as to itself as follows:
(a) Organization; Powers. The Buyer (i) is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, (ii) has all requisite power and authority to own its property and
assets and to carry on its business as now
14
conducted and as proposed to be conducted, (iii) is qualified to do business in,
and is in good standing in, each jurisdiction where the nature of its business
so requires, except where the failure so to qualify would not have a Borrower
Material Adverse Effect and (iv) has the corporate power and authority to
execute, deliver and perform its obligations under each of the Related Documents
and each other agreement or instrument contemplated hereby or thereby to which
it is or will be a party.
(b) Authorization. The execution, delivery and performance by the Buyer
of each of the Related Documents and the performance of the Transactions (i)
have been duly authorized by all requisite corporate and, if required,
stockholder action and (ii) will not (A) violate (1) any Requirement of Law
applicable to the Buyer or (2) any provision of any Related Document or any
other Contractual Obligation to which the Buyer is a party or by which it or any
of its property is or may be bound, (B) be in conflict with, result in a breach
of or constitute (alone or with notice or lapse of time or both) a default
under, or give rise to any right to accelerate or to require the pre-payment,
repurchase or redemption of any obligation under any Related Document or any
other Contractual Obligation or (C) result in the creation or imposition of any
Adverse Claim upon the Transferred Receivables and other Receivable Assets
(other than Permitted Liens).
(c) Enforceability. This Agreement has been duly executed and delivered
by the Buyer and constitutes, and each other Related Document to which the Buyer
is a party when executed and delivered by the Buyer will constitute, a legal,
valid and binding obligation of the Buyer enforceable against the Buyer in
accordance with its respective terms, subject (i) to applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting the
enforcement of creditors, rights generally, from time to time in effect and (ii)
to general principles of equity whether enforcement is sought by a proceeding in
equity or at law.
(d) Accounting Treatment. The Buyer will not prepare any financial
statements that shall account for the transactions contemplated hereby, nor will
it in any other respect (other than for tax purposes) account for the
transactions contemplated hereby, in a manner that is inconsistent with the
Buyer's ownership interest in the Transferred Receivables and other Receivable
Assets.
ARTICLE V
AFFIRMATIVE COVENANTS OF THE ORIGINATORS
Each Originator hereby agrees that, so long as there are any amounts outstanding
with respect to Transferred Receivables originated by it previously conveyed to
the Buyer or until the occurrence of an Early Termination, whichever is later,
such Originator shall:
Section 5.01. Certificates; Other Information. Furnish to the Buyer:
(a) not later than 120 days after the end of each fiscal year and not
later than 90 days after the end of each of the first three fiscal quarters of
each fiscal year, a certificate of a Responsible Officer of such Originator
stating that, to the knowledge of such Responsible Officer (after due inquiry),
such Originator during such period has observed or performed all of its
covenants and other agreements, and satisfied every condition, contained in the
Related
15
Documents to which it is a party to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any Purchase
Termination Event or Potential Purchase Termination Event except as specified in
such certificate; and
(b) promptly, such additional financial and other information as the
Buyer may from time to time reasonably request.
Section 5.02. Compliance with Law and Credit and Collection Policy.
(a) Comply with all Requirements of Law and material Contractual
Obligations applicable to it except to the extent that non-compliance would not
reasonably be likely to result in an Originator Material Adverse Effect.
(b) Perform its obligations in accordance with the Credit and Collection
Policy, as amended from time to time in accordance with the Related Documents,
in regard to the Receivables originated by it.
Section 5.03. Preservation of Existence. (a) Preserve and maintain its
corporate trust or limited partnership existence, rights, franchises and
privileges in the jurisdiction of its organization and (b) qualify and remain
qualified in good standing as a foreign corporation, business trust or limited
partnership in each jurisdiction where the nature of its business so requires,
except where the failure so to qualify would not, individually or in the
aggregate with other such failures, have an Originator Material Adverse Effect.
Section 5.04. Separate Corporate Existence.
(a) Maintain its deposit account or accounts, separate from those of the
Buyer and ensure that its funds will not be diverted to the Buyer, nor will such
funds be commingled with the funds of the Buyer;
(b) To the extent that it shares any officers or other employees with
the Buyer, the salaries of and the expenses related to providing benefits to
such officers and other employees shall be fairly allocated among it and the
Buyer, and it and the Buyer shall bear their fair shares of the salary and
benefit costs associated with all such common officers and employees;
(c) To the extent that it jointly contracts with the Buyer to do
business with vendors or service providers or to share overhead expenses, the
costs incurred in so doing shall be allocated fairly between it and the Buyer
and it and the Buyer shall bear their fair shares of such costs. To the extent
that it contracts or does business with vendors or service providers where the
goods and services provided are partially for the benefit of the Buyer, the
costs incurred in so doing shall be fairly allocated between it and the Buyer in
proportion to the benefit of the goods or services each is provided, and it and
the Buyer shall bear their fair shares of such costs. All material transactions
between it and the Buyer, whether currently existing or hereafter entered into,
shall be only on an arm's length basis;
(d) Maintain office space separate from the office space of the Buyer
(but which may be located at the same address as the Buyer). To the extent that
it and the Buyer have offices
16
in the same location, there shall be a fair and appropriate allocation of
overhead costs between them, and each shall bear its fair share of such
expenses;
(e) Issue financial statements separate from any financial statements
issued by the Buyer;
(f) Not assume or guarantee any of the liabilities of the Buyer; and
(g) Take, or refrain from taking, as the case may be, all other actions
that are necessary to be taken or not to be taken in order (x) to ensure that
the assumptions and factual recitations set forth in the opinion of ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇ delivered pursuant to the Schedule of Documents with respect to issues
of substantive consolidation and true-sale and absolute transfer, remain true
and correct with respect to it (and, to the extent within its control, to ensure
that the assumptions and factual recitations set forth in such opinions remain
true and correct with respect to the Buyer) and (y) to comply with those
procedures described in such provisions that are applicable to it.
Section 5.05. Inspection of Property; Books and Records; Discussions. Keep
proper books of records and account in which entries in conformity with GAAP
shall be made of all dealings and transactions in relation to its business and
activities; and permit representatives of the Buyer upon reasonable advance
notice to visit and inspect any of its properties and examine and make abstracts
from any of its books and records during normal business hours on any Business
Day and as often as may reasonably be requested, subject to such Originator's
security and confidentiality requirements and to discuss the business,
operations, properties and financial condition of such Originator with officers
and employees of such Originator. Any such examination or visit shall be at the
cost and expense of the party or parties making such examination or visit.
Section 5.06. Location of Records. Keep its chief place of business and
chief executive office, and the offices where it keeps the records concerning
the Transferred Receivables and other Receivable Assets (and all original
documents relating thereto), at the locations set forth on Schedule 4.01(q)
hereto or upon 30 days' prior written notice to the Buyer, at such other
locations in a jurisdiction where all action required by Section 5.13 shall have
been taken and completed and be in full force and effect; provided, however,
that the Lender shall be notified of any such changes in location.
Section 5.07. Computer Files. At its own cost and expense, retain the
ledger used by it as a master record of the Obligors and retain copies of all
documents relating to each Obligor as custodian and agent for the Buyer and
other Persons with interests in the Transferred Receivables originated by it and
other Receivable Assets related thereto.
Section 5.08. Obligations. Defend the right, title and interest of the
Buyer and its assigns in, to and under the Receivables originated by it and
other Receivable Assets related thereto, whether now existing or hereafter
created, against all claims of third parties claiming through any Originator.
Such Originator will duly fulfill all obligations on its part to be fulfilled
under or in connection with each Receivable originated by it and other
Receivable Assets related thereto
17
and will do nothing to materially impair the rights of the Buyer in such
Receivable and other Receivable Assets.
Section 5.09. Collections. Instruct each Obligor to make payments in
respect of its Receivables to a Lockbox or a Lockbox Account or by wire transfer
to the Collection Account and to comply in all material respects with procedures
with respect to Collections reasonably specified from time to time by the Buyer.
In the event that any payments in respect of any such Receivables are made
directly to such Originator (including, without limitation, any employees
thereof or independent contractors employed thereby), such Originator shall,
within two Business Days of receipt thereof, deliver (which may be via regular
mail) or deposit such amounts to a Lockbox, a Lockbox Account or the Collection
Account and, prior to forwarding such amounts, such Originator shall hold such
payments in trust as custodian for the Buyer and the Lender.
Section 5.10. Furnishing Copies, Etc. Furnish to the Buyer:
(a) within five Business Days of the Buyer's request, a certificate of
the chief financial officer of such Originator or of the Servicer, on behalf of
such Originator, certifying, as of the date thereof, to the knowledge of such
officer, that no Purchase Termination Event has occurred and is continuing or if
one has so occurred, specifying the nature and extent thereof and any corrective
action taken or proposed to be taken with respect thereto;
(b) promptly after a Responsible Officer of such Originator obtains
knowledge of the occurrence of any Purchase Termination Event or Potential
Purchase Termination Event, written notice thereof;
(c) promptly following request therefor, such other information,
documents, records or reports regarding or with respect to the Transferred
Receivables and other Receivable Assets, as the Buyer may from time to time
reasonably request;
(d) promptly upon determining that any Transferred Receivable originated
by it designated as an Eligible Receivable on the applicable Borrowing Base
Certificate or Monthly Report was not an Eligible Receivable as of the date
provided therefor, written notice of such determination.
Section 5.11. Responsibilities of the Originators. Notwithstanding
anything herein to the contrary, (i) each Originator shall perform or cause to
be performed all of its obligations under the Credit and Collection Policy
related to the Transferred Receivables to the same extent as if such Transferred
Receivables had not been transferred to the Buyer hereunder, (ii) the exercise
by the Buyer of any of its rights hereunder shall not relieve such Originator of
its obligations with respect to such Transferred Receivables and other
Receivable Assets and (iii) except as provided by law, the Buyer shall not have
any obligation or liability with respect to any Transferred Receivables and
other Receivable Assets, nor shall the Buyer be obligated to perform any of the
obligations or duties of such Originator thereunder.
Section 5.12. Assessments. Pay before the same become delinquent and
discharge all taxes, assessments, levies and other governmental charges imposed
on it except such taxes,
18
assessments, levies and governmental charges which are being contested in good
faith and for which such Originator has set aside on its books adequate
reserves.
Section 5.13. Further Action. In addition to the foregoing:
(a) Each Originator 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 may be necessary in such Originator's reasonable
judgment or that the Buyer may reasonably request, in order to protect the
Buyer's right, title and interest in the Transferred Receivables and other
Receivable Assets, or to enable the Buyer to exercise or enforce any of its
rights in respect thereof. Without limiting the generality of the foregoing,
each Originator will upon the request of the Buyer (i) execute and file such
financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary or, in the opinion of the Buyer,
advisable to protect the Buyer's security interest in the Receivables and other
Receivable Assets and (ii) obtain the agreement of any Person having an Adverse
Claim on any Receivables or other Receivable Assets owned by such Originator
(other than any Permitted Lien) to release such Adverse Claim upon the purchase
of any such Receivables or other Receivable Assets by the Buyer.
(b) Until the termination of this Agreement, each Originator hereby
irrevocably authorizes the Buyer to file one or more financing or continuation
statements (and other similar instruments), and amendments thereto, relative to
all or any part of the Transferred Receivables and other Receivable Assets sold
or to be sold by such Originator without the signature of such Originator to the
extent permitted by applicable law.
(c) If any Originator fails to perform any of its agreements or
obligations under this Agreement, following notice to such Originator detailing
such delinquency, the Buyer may (but shall not be required to) perform, or cause
performance of, such agreements or obligations, and the expenses of the Buyer
incurred in connection therewith shall be payable by such Originator as provided
in Section 8.02 hereof. The Buyer agrees promptly to notify the applicable
Originator after any such performance; provided, however, that the failure to
give such notice shall not affect the validity of any such performance.
Section 5.14. Sale of Receivables and other Receivable Assets. Sell
Receivables solely in accordance with the terms of this Agreement.
ARTICLE VI
NEGATIVE COVENANTS
Except as otherwise provided in Section 6.11 hereof, ▇▇▇▇▇▇ Micro and each other
Originator, to the extent applicable to it, hereby agrees that, so long as there
are any amounts outstanding with respect to Transferred Receivables originated
by it previously transferred by such Originator to the Buyer or until an Early
Termination with respect to such Originator, whichever is later, such Originator
shall not, directly or indirectly:
19
Section 6.01. Limitations on Transfers of Receivables and other Receivable
Assets. At any time sell, transfer or otherwise dispose of any of the
Receivables or other Receivable Assets related thereto except as contemplated by
the Related Documents.
Section 6.02. Extension or Amendment of Receivables. Extend, make any
Dilution Adjustment to, rescind, cancel, amend or otherwise modify, or attempt
or purport to extend, amend or otherwise modify, the terms of any Transferred
Receivables, except (a) in accordance with the terms of the Credit and
Collection Policy, (b) as required by any Requirement of Law applicable to such
Originator or (c) in the case of Dilution Adjustments, upon making a Dilution
Adjustment Payment pursuant to Section 2.05.
Section 6.03. Change in Payment Instructions to Obligors. Instruct any
Obligor of any Transferred Receivables to make any payments with respect to any
Receivables other than, in accordance with Section 5.09 hereof, to a Lockbox, a
Lockbox Account or by wire transfer to the Collection Account; provided,
however, that subject to the consent of the Lender (which consent shall not be
unreasonably withheld), it may execute additional Lockbox Agreements or
establish additional Lockbox Accounts and instruct Obligors to make payments in
respect of any Receivables to such additional accounts; provided, further, that
subject to the consent of the Lender (which consent shall not be unreasonably
withheld), any Originator may enter into any amendments or modifications of a
Lockbox Agreement that such Originator reasonably deems necessary to conform
such Lockbox Agreement to the cash management system of the Buyer or such
Originator.
Section 6.04. Change in Name. Change its name indicated on the public
records of its jurisdiction of organization, use an additional name, or change
the type of entity it is or its jurisdiction of organization, without 30 days'
prior written notice to the Buyer and the Lender.
Section 6.05. Credit and Collection Policy. Make any change or
modification (or permit any change or modification to be made) in any material
respect to the Credit and Collection Policy, except (i) if such changes or
modifications are necessary under any Requirement of Law, or (ii) if the Lender
has consented thereto (which consent shall not be unreasonably withheld).
Section 6.06. Modification of Legend. Delete or otherwise modify the
legend referred to in Section 2.01(h).
Section 6.07. Accounting for Purchases. Prepare any financial statements
which shall account for the transactions contemplated hereby (other than capital
contributions and the Subordinated Notes contemplated hereby) in any manner
other than as a sale of the Transferred Receivables and other Receivable Assets
originated by such Originator to the Buyer or in any other respect account for
or treat the transactions contemplated hereby (including for financial
accounting purposes, except as required by law) (other than capital
contributions and the Subordinated Notes contemplated hereby) in any manner
other than as sales of the Transferred Receivables and other Receivable Assets
originated by such Originator to the Buyer; provided, however, that this
subsection shall not apply for any tax or tax accounting purposes.
Section 6.08. Instruments. Take any action to cause any Receivable not
evidenced by an "instrument" (as defined in the UCC as in effect in the State of
New York or other similar statute
20
or legislation) upon origination to become evidenced by an instrument, except in
connection with the enforcement or collection of an overdue Receivable.
Section 6.09. Ineligible Receivables. Without the prior written approval
of the Buyer, take any action to cause, or which would permit, a Receivable that
was designated as an Eligible Receivable on the applicable Transfer Date
relating to such Receivable to cease to be an Eligible Receivable, except as
otherwise expressly provided by this Agreement.
Section 6.10. Business of such Originator. Fail to maintain and operate
the business currently conducted by such Originator and business activities
reasonably incidental or related thereto in substantially the manner in which it
is presently conducted and operated if such failure would materially adversely
affect the interests of the Buyer under the Related Documents.
Section 6.11. Limitation on Fundamental Changes. Such Originator shall not
enter into any merger or consolidate with another Person or sell, lease,
transfer or otherwise dispose of assets constituting all or substantially all of
the assets of such Originator and its consolidated Subsidiaries (taken as a
whole) other than the assignments and transfers contemplated hereby to another
Person or liquidate or dissolve unless:
(a) either (i) such Originator is the surviving entity or (ii) the
surviving Person (A) is organized and in good standing under a State of the
United States or the District of Columbia and (B) assumes, upon consummation of
such transaction without execution or filing of any paper or any further act on
the part of any of the parties hereto other than an Originator, the performance
of each of such Originator's covenants and obligations hereunder; and
(b) it has delivered to the Lender an officer's certificate executed by
a Vice President or other senior official of such Originator addressed to the
Lender (i) stating that such consolidation, merger, conveyance or transfer
complies with this Section 6.11 and (ii) further stating in the officer's
certificate that all conditions precedent herein provided for relating to such
transaction have been complied with.
ARTICLE VII
PURCHASE TERMINATION EVENTS
Section 7.01. Purchase Termination Events. If any of the following events
(each, a "Purchase Termination Event") shall have occurred and be continuing
with respect to an Originator:
(a) such Originator shall fail to pay (i) any amount due under Article
II hereof in accordance with the provisions hereof and such failure shall
continue unremedied for a period of five Business Days or (ii) any other amount
due hereunder in accordance with the provisions hereof and such failure shall
continue unremedied for a period of five Business Days from the earlier to occur
of (x) the date upon which a Responsible Officer of such Originator obtains
knowledge of such failure or (y) the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to such
Originator by the Buyer or the Lender; or
(b) such Originator shall fail to observe or perform in any material
respect any covenant or agreement applicable to it contained herein and such
failure to observe or perform
21
such covenant (other than as specified in subsection (a) of this Section 7.01)
shall continue unremedied for a period of 30 consecutive days from the earlier
of (i) the date on which such Originator obtains actual knowledge of such
failure and (ii) the date on which such Originator receives notice of such
failure from the Buyer, the Servicer or the Lender; or
(c) any representation, warranty, certification or statement made or
deemed made by such Originator in this Agreement or in any certificate delivered
pursuant to this Agreement shall prove to have been incorrect in any material
respect when made or deemed made; provided that a Purchase Termination Event
shall not be deemed to have occurred under this subsection (c) based upon a
breach of any representation or warranty set forth in Section 4.02 if such
Originator shall have complied with the provisions of Section 2.06 in respect
thereof; or
(d) (i) a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of such Originator in an involuntary case under
the Bankruptcy Code or any Applicable Insolvency Law now or hereafter in effect,
which decree or order is not stayed or any other similar relief shall be granted
under any applicable federal or state law now or hereafter in effect and shall
not be stayed; (ii)(A) an involuntary case is commenced against such Originator
under any Applicable Insolvency Law now or hereafter in effect, a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or other officer having
similar powers over such Originator, or over all or a substantial part of the
property of such Originator, shall have been entered, an interim receiver,
trustee or other custodian of such Originator for all or a substantial part of
the property of such Originator is involuntarily appointed, a warrant of
attachment, execution or similar process is issued against any substantial part
of the property of such Originator and (B) any event referred to in clause
(ii)(A) above continues for 60 days unless dismissed, bonded or discharged;
provided, however, that such 60-day period shall be deemed terminated
immediately upon the occurrence of any of the events referred to in this Section
7.01(d) other than those referred to in clause (ii)(A) above; (iii) such
Originator shall at its request have a decree or an order for relief entered
with respect to it or commence a voluntary case under any Applicable Insolvency
Law now or hereafter in effect, or shall consent to the entry of a decree or an
order for relief in an involuntary case, or to the conversion of an involuntary
case to a voluntary case, under any such Applicable Insolvency Law, consent to
the appointment of or taking possession by a receiver, trustee or other
custodian for all or a substantial part of its property; (iv) the making by such
Originator of any general assignment for the benefit of creditors; (v) the
inability or failure of such Originator generally to pay its debts as such debts
become due; or (vi) the Board of Directors of such Originator authorizes action
to approve any of the foregoing; or
(e) there shall have occurred and be continuing a Termination Event set
forth in Section 9.01 of the Funding Agreement; or
(f) a Responsible Officer of such Originator receives notice or is aware
that a notice of Lien shall have been filed by the PBGC against such Originator
under Section 412(n) of the IRC or Section 302(f) of ERISA for a failure to make
a required installment or other payment to a plan to which Section 412(n) of the
IRC or Section 302(f) of ERISA applies unless there shall have been delivered to
the Lender proof of release of such Lien; or
22
(g) a Responsible Officer of such Originator receives notice or is aware
that a Federal tax notice of Lien shall have been filed against such Originator
unless there shall have been delivered to the Lender proof of release of such
Lien;
then, (i) in the case of any Purchase Termination Event described in subsection
(e) above, the obligation of the Buyer to purchase Receivables and other
Receivable Assets from the Originators shall thereupon automatically terminate
without further notice of any kind, which is hereby waived by each Originator,
(ii) in the case of any Purchase Termination Event described in subsection (d),
(f) or (g) above, the obligation of the Buyer to purchase Receivables and other
Receivable Assets from the Originators shall thereupon, after expiration of any
applicable cure period, automatically terminate without further notice of any
kind, which is hereby waived by each Originator and (iii) in the case of any
other Purchase Termination Event, so long as such Purchase Termination Event
shall be continuing and after expiration of any applicable cure period, the
Buyer may terminate its obligation to purchase Receivables and other Receivable
Assets from all of the Originators by written notice to each Originator (any
termination pursuant to clause (i), (ii) or (iii) above is herein called an
"Early Termination").
Section 7.02. Remedies. (a) If a Purchase Termination Event has occurred
and is continuing, the Buyer (and its assignees) shall have all of the rights
and remedies provided to a secured creditor or a purchaser of accounts under the
UCC by applicable law in respect thereto.
(b) Each Originator agrees that, upon the occurrence and during the
continuation of a Purchase Termination Event under Section 7.01(d) or (e):
(i) the Buyer (and its assignees) shall have the right at any time
to notify, or require that such Originator, at such Originator's expense,
notify, the respective Obligors of the Buyer's ownership of the
Transferred Receivables and may direct that payment of all amounts due or
to become due under the Transferred Receivables be made directly to the
Buyer or its designee;
(ii) the Buyer (and its assignees) shall have the right to (A) ▇▇▇
for collection on any Transferred Receivables or (B) sell any Transferred
Receivables or other Receivable Assets to any Person for a price that is
acceptable to the Buyer. If required by the terms of the UCC (or any other
similar law applicable to the Receivables and other Receivable Assets),
the Buyer (and its assignees) may offer to sell any Transferred Receivable
and other Receivable Assets to any Person, together, at its option, with
all other Receivables created by the same Obligor. Any Transferred
Receivable and other Receivable Assets related thereto sold hereunder
(other than pursuant to the Funding Agreement) shall cease to be a
Receivable for all purposes under this Agreement as of the effective date
of such sale;
(iii) such Originator shall, upon the Buyer's written request and at
such Originator's expense, (A) assemble all of such Originator's
documents, instruments and other records (including credit files and
computer tapes or disks) that (1) evidence or will evidence or record
Receivables and other Receivable Assets transferred by such Originator and
(2) are otherwise necessary or desirable to effect Collections of such
Transferred Receivables (collectively, the "Documents") and (B) deliver
the Documents
23
to the Buyer or its designee at a place designated by the Buyer. In
recognition of such Originator's need to have access to any Documents
which may be transferred to the Buyer hereunder, whether as a result of
its continuing business relationship with any Obligor for Receivables and
other Receivable Assets purchased hereunder or as a result of its
responsibilities as Servicer, the Buyer hereby grants to such Originator
an irrevocable license to access the Documents transferred by such
Originator to the Buyer and to access any such transferred computer
software in connection with any activity arising in the ordinary course of
such Originator's business or in performance of such Originator's duties
as Servicer; provided that such Originator shall not disrupt or otherwise
interfere with the Buyer's use of and access to the Documents and its
computer software during such license period;
(iv) such Originator hereby grants to the Buyer an irrevocable
power of attorney (coupled with an interest) to take any and all steps in
such Originator's name necessary or desirable, in the reasonable opinion
of the Buyer, to collect all amounts due under the Transferred
Receivables, including, without limitation, endorsing such Originator's
name on checks and other instruments representing Collections, enforcing
the Transferred Receivables and other Receivable Assets and exercising all
rights and remedies in respect thereof; and
(v) upon written request of the Buyer, such Originator will (A)
deliver to the Buyer all licenses, rights, computer programs, related
material, computer tapes, disks, cassettes and data necessary for the
immediate collection of the Transferred Receivables by the Buyer, with or
without the participation of such Originator (excluding software licenses
which by their terms are not permitted to be so delivered; provided that
such Originator shall use reasonable efforts to obtain the consent of the
relevant licensor to such delivery but shall not be required, to the
extent it has an ownership interest in any electronic records, computer
software or licenses, to transfer, assign, set-over or otherwise convey
such ownership interests to the Buyer) and (B) make such arrangements with
respect to the collection of the Transferred Receivables as may be
reasonably required by the Buyer.
ARTICLE VIII
MISCELLANEOUS
Section 8.01. Payments. Each cash payment to be made by the Buyer or any
Originator hereunder shall be made on the required payment date and in
immediately available funds at the office of the payee set forth on Schedule
8.07 hereto or to such other office as may be specified by either party in a
notice to the other party hereto.
Section 8.02. Costs and Expenses. Each Originator agrees (a) to pay or
reimburse the Buyer for all its out-of-pocket costs and expenses incurred in
connection with the preparation and execution of, and any amendment, supplement
or modification to, this Agreement, the other Related Documents and any other
documents prepared in connection herewith and therewith, the consummation and
administration of the transactions contemplated hereby and thereby, including,
without limitation, all reasonable fees and disbursements of counsel, (b) to pay
or reimburse the Buyer for all its costs and expenses incurred in connection
with the enforcement or
24
preservation of any rights under this Agreement and any of the other Related
Documents, including, without limitation, the reasonable fees and disbursements
of counsel to the Buyer, (c) to pay, indemnify, and hold the Buyer harmless
from, any and all recording and filing fees and any and all liabilities with
respect to, or resulting from any delay caused by such Originator in paying,
stamp, excise and other similar taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of, any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement and any such other documents, and (d) to pay,
indemnify, and hold the Buyer harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever (i) which may
at any time be imposed on, incurred by or asserted against the Buyer in any way
relating to or arising out of this Agreement or the other Related Documents or
the transactions contemplated hereby and thereby or in connection herewith or
any action taken or omitted by the Buyer under or in connection with any of the
foregoing (all such other liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses and disbursements being herein called
"Indemnified Liabilities") or (ii) which would not have been imposed on,
incurred by or asserted against the Buyer but for its having acquired the
Receivables and other Receivable Assets hereunder; provided, however, that such
indemnity shall not be available to the extent that such Indemnified Liabilities
result from the gross negligence or willful misconduct of the Buyer; provided,
further, that such Originator shall have no obligation under this Section 8.02
to the Buyer with respect to Indemnified Liabilities arising from (i) any action
taken or omitted to be taken by the Lender or the Buyer at the direction of the
Lender in collecting from an Obligor or (ii) a default by an Obligor with
respect to any Transferred Receivable (other than arising out of (x) any
discharge, claim, offset or defense (other than discharge in bankruptcy of the
Obligor) of the Obligor to the payment of any Transferred Receivable (including,
without limitation, a defense based on such Transferred Receivable not being a
legal, valid and binding obligation of such Obligor enforceable against it in
accordance with its terms) or any other claim resulting from the sale of the
merchandise or services related to any such Transferred Receivable or the
furnishing or failure to furnish such merchandise or services, (y) a failure by
such Originator to perform its duties or obligations under this Agreement or (z)
the sale of any Transferred Receivable that is designated on any Borrowing Base
Certificate to be an Eligible Receivable and is determined to have been at the
date of such sale an Ineligible Receivable or any Transferred Receivable which
thereafter becomes subject to a Dilution Adjustment). The agreements in this
Section 8.02 shall survive the collection of all Receivables, the termination of
this Agreement and the payment of all amounts payable hereunder.
Section 8.03. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the Originators and the Buyer and their respective
successors (whether by merger, consolidation or otherwise) and assigns. Each
Originator agrees that it will not assign or transfer all or any portion of its
rights or obligations hereunder without the prior written consent of the Buyer.
acknowledges that the Buyer shall assign all of its rights hereunder to the
Lender. Each Originator consents to such assignment and agrees that the Lender,
to the extent provided in the Funding Agreement, shall be entitled to enforce
the terms of this Agreement and the rights (including, without limitation, the
right to grant or withhold any consent or, waiver) of the Buyer directly against
such Originator, whether or not a Purchase Termination Event or a Potential
Purchase Termination Event has occurred. Each Originator
25
further agrees that, in respect of its obligations hereunder, it will act at the
direction of and in accordance with all requests and instructions from the
Lender until all Borrower Obligations are paid in full. The Lender shall have
the rights of a third-party beneficiary under this Agreement.
Section 8.04. No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Buyer, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any other right, remedy,
power or privilege. The rights, remedies, powers and privileges herein provided
are cumulative and not exhaustive of any rights, remedies, powers and privileges
provided by law.
Section 8.05. Amendments and Waivers. Neither this Agreement nor any terms
hereof may be amended, supplemented or modified except in a writing signed by
the Buyer and each Originator. Any amendment, supplement or modification shall
not be effective until the Lender shall have given its written consent thereto
(which consent shall not be unreasonably withheld).
Section 8.06. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Section 8.07. Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered by hand, or three days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, all of which shall be to the address or facsimile number set forth on
Schedule 8.07 hereto.
Section 8.08. Counterparts. This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts
(including by telecopy), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Buyer.
Section 8.09. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY
TRIAL.
(a) THIS AGREEMENT AND EACH RELATED DOCUMENT (EXCEPT TO THE EXTENT THAT
ANY RELATED DOCUMENT EXPRESSLY PROVIDES TO THE CONTRARY) AND THE OBLIGATIONS
ARISING HEREUNDER AND THEREUNDER SHALL IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAWS BUT OTHERWISE WITHOUT REGARD TO
CONFLICTS OF LAW PRINCIPLES), EXCEPT TO THE EXTENT THAT THE PERFECTION, EFFECT
26
OF PERFECTION OR PRIORITY OF THE INTERESTS OF THE BUYER IN THE RECEIVABLES OR
REMEDIES HEREUNDER OR THEREUNDER, IN RESPECT THEREOF, ARE GOVERNED BY THE LAWS
OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK, AND ANY APPLICABLE LAWS OF
THE UNITED STATES OF AMERICA.
(b) EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR
FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY SHALL HAVE
EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THEM
PERTAINING TO THIS AGREEMENT OR TO ANY MATTER ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR ANY RELATED DOCUMENT; PROVIDED, THAT EACH PARTY HERETO ACKNOWLEDGES
THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE OF THE BOROUGH OF MANHATTAN IN NEW YORK CITY; PROVIDED FURTHER, THAT
NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE BUYER FROM
BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE
ON THE RECEIVABLES OR ANY OTHER SECURITY FOR THE OBLIGATIONS OF THE ORIGINATORS
ARISING HEREUNDER, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
BUYER. EACH PARTY HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN
ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH PARTY HERETO HEREBY
WAIVES, TO THE EXTENT PERMITTED BY LAW, ANY OBJECTION THAT SUCH PARTY MAY HAVE
BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS
AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS
DEEMED APPROPRIATE BY SUCH COURT. EACH PARTY HERETO HEREBY WAIVES PERSONAL
SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR
SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH PARTY AT THE ADDRESS SET
FORTH IN SECTION 7.01 HEREOF AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED
UPON THE EARLIER OF SUCH PARTY'S ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER
DEPOSIT IN THE UNITED STATES MAIL, PROPER POSTAGE PREPAID. NOTHING IN THIS
SECTION SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW.
BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE
MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND
THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN
ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A
JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO
WAIVE, TO THE EXTENT PERMITTED
27
BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO
RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING
OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY RELATED DOCUMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section 8.10. Addition of Originators. Subject to the conditions precedent
set forth in Section 3.05, from time to time one or more additional direct or
indirect Subsidiaries of ▇▇▇▇▇▇ Micro may become an Originator hereunder and a
party hereto. If any such Subsidiary wishes to become an Originator hereunder,
it shall submit a request to such effect in writing to the Buyer. If the Buyer
shall have agreed to any such request, such Subsidiary shall become an
additional Originator hereunder and a party hereto on the related Originator
Addition Date upon satisfaction of the conditions set forth in Section 3.05.
Section 8.11. Termination of Originators. (a) Any Originator shall be
terminated as an Originator hereunder by the Buyer on the date such Originator
ceases to be a direct or indirect Subsidiary of ▇▇▇▇▇▇ Micro; provided that (i)
the aggregate Outstanding Balance of Transferred Receivables sold by all
Originators which so cease to be Subsidiaries at such time (together with the
aggregate Outstanding Balance of Transferred Receivables sold by all Originators
which have been terminated pursuant to this Section 8.11 within the preceding 90
days) shall not exceed 10% of the aggregate Outstanding Balance of all
Transferred Receivables and (ii) no Purchase Termination Event or Potential
Purchase Termination Event (other than with respect to the Originator so
terminated) has occurred and is continuing, or would occur as a result thereof.
From and after the date any such Originator ceases to be a direct or indirect
Subsidiary of ▇▇▇▇▇▇ Micro, the Buyer shall cease buying Receivables and other
Receivable Assets from such Originator. Each such Originator shall be released
as an Originator party hereto for all purposes and shall cease to be a party
hereto on the 91st day after the date on which there are no amounts outstanding
with respect to Transferred Receivables previously transferred by such
Originator to the Buyer, whether such amounts have been collected or written off
in accordance with the Credit and Collection Policy, except to the extent of
such Originator's continuing obligations under Section 8.11(c) below. Prior to
such date, such Originator shall be obligated to perform its obligations
hereunder and under the other Related Documents to which it is a party with
respect to Transferred Receivables and other Receivable Assets previously sold
by such Originator to the Buyer, including, without limitation, its obligation
to direct the deposit of Collections into the appropriate Lockbox or Lockbox
Account.
(b) From time to time the Originators, or the Servicer on behalf of the
Originators, may request in writing that the Buyer designate one or more
Originators as Originators that shall cease to be parties to this Agreement;
provided that no Purchase Termination Event or Potential Purchase Termination
Event has occurred and is continuing, or would occur as a result thereof.
Promptly after receipt of any such designation by the Buyer, the Originators
shall either (i) elect not to terminate such designated Originators or (ii)
select a date, which date shall not be later than 30 days after the date of
receipt of such designation, as the "Sale Termination Date" for such designated
Originators. From and after such Sale Termination Date, the Buyer shall cease
buying Receivables and other Receivable Assets from such Originators. Each such
Originator shall be released as an Originator hereunder and a party hereto for
all purposes and shall cease to
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be a party hereto on the 91st day after the date on which there are no amounts
outstanding with respect to Transferred Receivables and other Receivable Assets
previously transferred by such Originator to the Buyer, whether such amounts
have been collected or written off in accordance with the Credit and Collection
Policy, except to the extent of such Originator's continuing obligations under
Section 8.11(c) below. Prior to such date, such Originator shall be obligated to
perform its obligations hereunder and under the other Related Documents to which
it is a party with respect to Transferred Receivables and other Receivable
Assets previously sold by such Originator to the Buyer, including, without
limitation, its obligation to direct the deposit of Collections into the
appropriate Lockbox or Lockbox Account.
(c) A terminated Originator shall have no obligation to repurchase any
Transferred Receivables and other Receivable Assets previously sold by it to the
Buyer on and after the 90th day following the date on which there are no amounts
outstanding with respect to such Transferred Receivables, but will have
continuing obligations with respect to such Transferred Receivables and other
Receivable Assets (including making any Dilution Adjustment Payments, Originator
Adjustment Payments and Originator Indemnification Payments and with respect to
any Indemnified Liabilities) to the extent such obligations arise hereunder.
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Section 8.12. No Bankruptcy Petition. Each Originator, by entering into
this Agreement, and any present or future holder of each Subordinated Note, by
its acceptance thereof, covenants and agrees that, prior to the date which is
one year and one day after the date of termination of this Agreement pursuant to
Section 8.13, it will not institute against, or join any other Person in
instituting against, the Buyer any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any Applicable
Insolvency Laws.
Section 8.13. Termination. This Agreement will terminate at such time as
(i) the commitment of the Buyer to purchase Receivables and other Receivable
Assets from all the Originators hereunder shall have terminated, (ii) all
Receivables purchased hereunder have been collected, and the proceeds thereof
turned over to the Buyer and all other amounts owing to the Buyer hereunder
shall have been paid in full or, if Receivables sold hereunder have not been
collected, such Receivables have become Defaulted Receivables and the Buyer
shall have completed its collection efforts in respect thereto and (iii) the
Termination Date shall have occurred; provided, however, that the indemnities of
the Originators to the Buyer set forth in this Agreement shall survive such
termination; provided, further, that, to the extent any amounts remain due and
owing to the Buyer hereunder, the Buyer shall remain entitled to receive any
Collections on Receivables sold hereunder which have become Defaulted
Receivables after it shall have completed its collection efforts in respect
thereof. Notwithstanding anything to the contrary contained herein, if at any
time any payment made by any Originator is rescinded or must be restored or
returned by the Buyer as a result of any Insolvency Event with respect to such
Originator, then such Originator's obligations with respect to such payment
shall be reinstated as though such payment had never been made.
Section 8.14. Complete Agreement; Modification of Agreement. This
Agreement and the other Related Documents constitute the complete agreement
between the parties with respect to the subject matter hereof and thereof,
supersede all prior agreements and understandings relating to the subject matter
hereof and thereof, and may not be modified, altered or amended except as set
forth in Section 8.05.
Section 8.15. Section Titles. The section titles and table of contents
contained in this Agreement are provided for ease of reference only and shall be
without substantive meaning or content of any kind whatsoever and are not a part
of the agreement between the parties hereto.
Section 8.16. No Setoff. Each Originator's obligations under this
Agreement shall not be affected by any right of setoff, counterclaim,
recoupment, defense or other right such Originator might have against Buyer or
the Lender, all of which rights are hereby expressly waived by such Originator
for the term of this Agreement.
Section 8.17. Confidentiality.
(a) Except to the extent otherwise required by applicable law or
regulation or subpoena or similar legal process, or in connection with any
judicial or administrative proceedings, as required to be filed publicly with
the Securities and Exchange Commission, or unless the Lender shall otherwise
consent in writing, each Originator and Buyer agree to maintain the
confidentiality of this Agreement (and all drafts hereof and documents ancillary
hereto) in its communications with third parties other than any Affected Party
and otherwise and
30
not to disclose, deliver or otherwise make available to any third party (other
than its directors, officers, employees, accountants or counsel or ratings
agencies or credit insurance providers) the original or any copy of all or any
part of this Agreement (or any draft hereof and documents ancillary hereto)
except to an Affected Party.
(b) Each Originator agrees that it shall not (and shall not permit any
of its Subsidiaries to) issue any news release or make any public announcement
pertaining to the transactions contemplated by this Agreement and the Related
Documents without the prior written consent of Buyer and the Lender (which
consent shall not be unreasonably withheld) unless such news release or public
announcement is required by law or regulation or subpoena or similar legal
process, in which case such Originator shall consult with Buyer and the Lender
prior to the issuance of such news release or public announcement. Any
Originator may, however, disclose the general terms of the transactions
contemplated by this Agreement and the Related Documents to trade creditors,
suppliers and other similarly-situated Persons so long as such disclosure is not
in the form of a news release or public announcement.
(c) Except to the extent otherwise required by applicable law, or in
connection with any judicial or administrative proceedings, as required to be
filed publicly with the Securities Exchange Commission, or unless the
Originators otherwise consent in writing, the Buyer agrees (i) to maintain the
confidentiality of (A) this Agreement (and all drafts hereof and documents
ancillary hereto) and (B) all other confidential proprietary information with
respect to the Originators and their respective Affiliates and each of their
respective businesses obtained by the Buyer in connection with the structuring,
negotiation and execution of the transactions contemplated herein and in the
other documents ancillary hereto, in each case, in its communications with third
parties other than any Affected Party, any Originator or any party to whom
information may be disclosed pursuant to Section 14.05 of the Funding Agreement,
and (ii) not to disclose, deliver, or otherwise make available to any third
party (other than its directors, officers, employees, accountants or counsel)
the original or any copy of all or any part of this Agreement (or any draft
hereof and documents ancillary hereto) except to an Affected Party or any
Originator.
Section 8.18. Further Assurances.
(a) Each Originator shall, at its sole cost and expense, upon the
reasonable request of Buyer or the Lender, promptly and duly execute and deliver
any and all further instruments and documents and take such further actions that
may be necessary or desirable or that Buyer or the Lender may reasonably request
to carry out more effectively the provisions and purposes of this Agreement or
any other Related Document or to obtain the full benefits of this Agreement and
of the rights and powers herein granted, including (i) using its best efforts to
secure all consents and approvals necessary or appropriate for the assignment to
or for the benefit of Buyer of any Transferred Receivable and other Receivable
Assets held by such Originator or in which such Originator has any rights not
heretofore assigned, and (ii) filing any financing or continuation statements
under the UCC with respect to the ownership interests or Liens granted hereunder
or under any other Related Document. Each Originator hereby authorizes Buyer and
the Lender to file any such financing or continuation statements without the
signature of such Originator to the extent permitted by applicable law. A
carbon, photographic or other reproduction of this Agreement or of any notice or
financing statement covering the Transferred Receivables and
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other Receivable Assets or any part thereof shall be sufficient as a notice or
financing statement where permitted by law. If any amount payable under or in
connection with any of the Transferred Receivables is or shall become evidenced
by any instrument, such instrument, other than checks and notes received in the
ordinary course of business, shall be duly endorsed in a manner satisfactory to
Buyer immediately upon such Originator's receipt thereof and promptly delivered
to Buyer.
If any Originator fails to perform any agreement or obligation under this
Section 8.18, Buyer or the Lender may (but shall not be required to) itself
perform, or cause performance of, such agreement or obligation, and the
reasonable expenses of Buyer or the Lender incurred in connection therewith
shall be payable by such Originator upon demand of Buyer or the Lender.
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IN WITNESS WHEREOF, the parties have caused this Receivables Sale
Agreement to be executed by their respective duly authorized representatives, as
of the date first above written.
▇▇▇▇▇▇ MICRO INC., individually and as an Originator
By /s/ P. ▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
Name P. ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title Senior Director and Worldwide
Assistant Treasurer
▇▇▇▇▇▇ FUNDING INC., as Buyer
By /s/ ▇▇▇ ▇▇▇▇▇
-----------------------------------
Name ▇▇▇ ▇▇▇▇▇
Title Assistant Treasurer