Exhibit 10M
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
dated as of February 6, 2002
Among
AVNET RECEIVABLES CORPORATION, as Seller,
AVNET, INC., as Servicer,
THE COMPANIES,
THE FINANCIAL INSTITUTIONS,
and
BANK ONE, NA (MAIN OFFICE CHICAGO)
as Agent
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
TABLE OF CONTENTS
Page
ARTICLE I PURCHASE ARRANGEMENTS...........................................2
Section 1.1 Purchase Facility...............................................2
Section 1.2 Increases.......................................................2
Section 1.3 Decreases.......................................................3
Section 1.4 Payment Requirements............................................4
ARTICLE II PAYMENTS AND COLLECTIONS........................................4
Section 2.1 Payments........................................................4
Section 2.2 Collections Prior to Amortization...............................5
Section 2.3 Collections Following Amortization..............................6
Section 2.4 Application of Collections......................................6
Section 2.5 Payment Rescission..............................................7
Section 2.6 Maximum Purchaser Interests.....................................7
Section 2.7 Clean Up Call...................................................7
Section 2.8 Release of Lock-Box Arrangements................................7
ARTICLE III COMPANY FUNDING.................................................8
Section 3.1 CP Costs........................................................8
Section 3.2 CP Costs Payments...............................................8
Section 3.3 Calculation of CP Costs.........................................8
ARTICLE IV FINANCIAL INSTITUTION FUNDING...................................8
Section 4.1 Financial Institution Funding...................................8
Section 4.2 Yield Payments..................................................8
Section 4.3 Selection and Continuation of Tranche Periods...................9
Section 4.4 Financial Institution Discount Rates............................9
Section 4.5 Suspension of the LIBO Rate....................................10
Section 4.6 Extension of Liquidity Termination Date........................10
ARTICLE V REPRESENTATIONS AND WARRANTIES.................................12
Section 5.1 Representations and Warranties of The Seller Parties...........12
Section 5.2 Financial Institution Representations and Warranties...........16
ARTICLE VI CONDITIONS OF PURCHASES........................................17
Section 6.1 Conditions Precedent to Initial Incremental Purchase...........17
Section 6.2 Conditions Precedent to All Purchases and Reinvestments........17
ARTICLE VII COVENANTS......................................................18
Section 7.1 Affirmative Covenants of The Seller Parties....................18
Section 7.2 Negative Covenants of The Seller Parties.......................26
ARTICLE VIII ADMINISTRATION AND COLLECTION..................................27
Section 8.1 Designation of Servicer........................................27
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Section 8.2 Duties of Servicer...........................................28
Section 8.3 Collection Notices...........................................29
Section 8.4 Responsibilities of Seller...................................30
Section 8.5 Reports......................................................30
Section 8.6 Servicing Fees...............................................30
Section 8.7 Limited Recourse to Servicer.................................30
ARTICLE IX AMORTIZATION EVENTS..........................................31
Section 9.1 Amortization Events..........................................31
Section 9.2 Remedies.....................................................32
ARTICLE X INDEMNIFICATION..............................................33
Section 10.1 Indemnities by The Seller Parties............................33
Section 10.2 Increased Cost and Reduced Return............................36
Section 10.3 Other Costs and Expenses.....................................37
Section 10.4 Allocations..................................................37
ARTICLE XI THE AGENT....................................................38
Section 11.1 Authorization and Action.....................................38
Section 11.2 Delegation of Duties.........................................38
Section 11.3 Exculpatory Provisions.......................................38
Section 11.4 Reliance by Agent............................................39
Section 11.5 Non-Reliance on Agent and Other Purchasers...................39
Section 11.6 Reimbursement and Indemnification............................39
Section 11.7 Agent in its Individual Capacity.............................40
Section 11.8 Successor Agent..............................................40
ARTICLE XII ASSIGNMENTS; PARTICIPATIONS..................................40
Section 12.1 Assignments..................................................40
Section 12.2 Participations...............................................41
ARTICLE XIII MISCELLANEOUS................................................42
Section 13.1 Waivers and Amendments.......................................42
Section 13.2 Notices......................................................43
Section 13.3 Ratable Payments.............................................44
Section 13.4 Protection of Ownership Interests of the Purchasers..........44
Section 13.5 Confidentiality..............................................45
Section 13.6 Bankruptcy Petition..........................................45
Section 13.7 Limitation of Liability......................................45
Section 13.8 CHOICE OF LAW................................................46
Section 13.9 CONSENT TO JURISDICTION......................................46
Section 13.10 WAIVER OF JURY TRIAL.........................................46
Section 13.11 Integration; Binding Effect; Survival of Terms...............46
Section 13.12 Counterparts; Severability; Section References...............47
Section 13.13 Bank One Roles...............................................47
Section 13.14 Characterization.............................................47
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RECEIVABLES PURCHASE AGREEMENT
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Section 13.15 Assignment of Bank One Company's and Bank One's
Interests under the Original Agreement.......................48
Section 13.16 Confirmation and Ratification of Terms.......................49
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
iii
Exhibits and Schedules
Exhibit I Definitions
Exhibit II Form of Purchase Notice
Exhibit III Places of Business, Jurisdictions of Organization and Chief
Executive Offices of the Seller Parties; Locations of Records;
Organizational Number(s); Federal Employer Identification
Number(s); Other Names
Exhibit IV Names of Collection Banks; Collection Accounts
Exhibit V Form of Compliance Certificate
Exhibit VI Form of Collection Account Agreement
Exhibit VII Form of Assignment Agreement
Exhibit VIII Credit and Collection Policy
Exhibit IX Form of Contract(s)
Exhibit X Form of Monthly Report
Schedule A Commitments
Schedule B Closing Documents
Schedule C Computation of CP Costs
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
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AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
This Amended and Restated Receivables Purchase Agreement dated as of
February 6, 2002 is among Avnet Receivables Corporation, a Delaware corporation
("Seller"), Avnet, Inc., a New York corporation ("Avnet"), as initial Servicer
(the Servicer together with Seller, the "Seller Parties" and each a "Seller
Party"), the entities listed on Schedule A to this Agreement under the heading
"Financial Institution" (together with any of their respective successors and
assigns hereunder, the "Financial Institutions"), the entities listed on
Schedule A to this Agreement under the heading "Company" (together with any of
their respective successors and assigns hereunder, the "Companies") and Bank
One, NA (Main Office Chicago), as agent for the Purchasers hereunder or any
successor agent hereunder (together with its successors and assigns hereunder,
the "Agent"). Unless defined elsewhere herein, capitalized terms used in this
Agreement shall have the meanings assigned to such terms in Exhibit I.
PRELIMINARY STATEMENTS
The Seller Parties, Bank One, NA (Main Office Chicago), in its
capacity as a Financial Institution, the Bank One Company, in its capacity as a
Company, and the Agent entered into that certain Receivables Purchase Agreement,
dated as of June 28, 2001 (the "Original Agreement").
Liberty Street Funding Corp. (the "Scotia Company") desires to
become a Company party to the Original Agreement, and The Bank of Nova Scotia
("Scotia") desires to become a Financial Institution party to the Original
Agreement.
The Bank One Company desires to assign and transfer an undivided
33.3333333% interest in its, and the Scotia Company desires to acquire an
undivided 33.3333333% interest in the Bank One Company's, rights and obligations
under the Original Agreement and the other Transaction Documents (including,
without limitation, the Capital of the Bank One Company's Purchaser Interests)
as set forth herein.
Bank One, in its capacity as a Financial Institution, desires to
assign and transfer an undivided 14.28571% interest in its, and Scotia desires
to acquire an undivided 14.28571% interest in Bank One's, rights and obligations
as a Financial Institution under the Original Agreement and the other
Transaction Documents (including, without limitation, Bank One's Commitment) as
set forth herein.
Each of the parties hereto desires to increase the Purchase Limit
under the Original Agreement from $350,000,000 to $450,000,000 and to increase
the aggregate amount of the Commitments under the Original Agreement from
$357,000,000 to $459,000,000.
Seller desires to transfer and assign Purchaser Interests to the
Purchasers from time to time.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Each Company may, in its absolute and sole discretion, purchase
Purchaser Interests from Seller from time to time.
In the event that any Company declines to make any purchase, such
Company's Related Financial Institution(s) shall, at the request of Seller,
purchase Purchaser Interests that such Company declined to purchase from time to
time.
Bank One, NA (Main Office Chicago) has been requested and is willing
to act as Agent on behalf of the Companies and the Financial Institutions in
accordance with the terms hereof.
The parties hereto now desire to amend and restate the Original
Agreement in its entirety to read as set forth herein.
AGREEMENT
Now Therefore , in consideration of the foregoing and for other
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree that, subject to satisfaction of
the conditions precedent set forth in Section 6.1, the Original Agreement is
hereby amended and restated in its entirety to read as follows:
ARTICLE I
PURCHASE ARRANGEMENTS
Section 1.1 Purchase Facility.
Upon the terms and subject to the conditions hereof, Seller may, at
its option, sell and assign Purchaser Interests to the Agent for the benefit of
one or more of the Purchasers. In accordance with the terms and conditions set
forth herein, each Company may, at its option, instruct the Agent to purchase on
behalf of such Company, or if any Company shall decline to purchase, the Agent
shall purchase, on behalf of such declining Company's Related Financial
Institutions, Purchaser Interests from time to time in an aggregate amount not
to exceed at such time the lesser of (i) the Purchase Limit and (ii) the
aggregate amount of the Commitments during the period from the date hereof to
but not including the Facility Termination Date.
Section 1.2 Increases.
Seller shall provide the Agent and Scotia with at least two Business
Days' prior notice in a form set forth as Exhibit II hereto of each Incremental
Purchase (a "Purchase Notice"). Each Purchase Notice shall be subject to Section
6.2 hereof (and, in the case of the initial Purchase Notice, Section 6.1) and,
except as set forth below, shall be irrevocable and shall specify the requested
Purchase Price (which shall not be less than $10,000,000) and date of purchase
and, in the case of an Incremental Purchase to be funded by any of the Financial
Institutions, the requested Discount Rate and Tranche Period. Following receipt
of a Purchase Notice, the Agent will promptly notify the Bank
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One Company of such Purchase Notice, Scotia will promptly notify the Scotia
Company of such Purchase Notice and the Agent and Scotia will identify the
Companies that agree to make the purchase. If any Company declines to make a
proposed purchase, Seller may cancel the Purchase Notice as to all Purchasers
or, in the absence of such a cancellation, the Incremental Purchase of the
Purchaser Interests, which such Company has declined to purchase, will be made
by such declining Company's Related Financial Institutions in accordance with
the rest of this Section 1.2. If the proposed Incremental Purchase or any
portion thereof is to be made by any of the Financial Institutions, the Agent
shall send notice of the proposed Incremental Purchase to the Bank One Company's
Related Financial Institutions and/or Scotia shall send notice of the proposed
Incremental Purchase to the Scotia Company's Related Financial Institutions, as
applicable, in each case concurrently by telecopier, telex or cable specifying
(i) the date of such Incremental Purchase, which date must be at least one
Business Day after such notice is received by the applicable Financial
Institutions, (ii) each Financial Institution's Pro Rata Share of the aggregate
Purchase Price of the Purchaser Interests the Financial Institutions in such
Financial Institution's Purchaser Group are then purchasing and (iii) the
requested Discount Rate and Tranche Period. On the date of each Incremental
Purchase, upon satisfaction of the applicable conditions precedent set forth in
Article VI and the conditions set forth in this Section 1.2, the Companies
and/or the Financial Institutions, as applicable, shall deposit to the Facility
Account, in immediately available funds, no later than 12:00 noon (Chicago
time), an amount equal to (i) in the case of a Company that has agreed to make
such Incremental Purchase, such Company's Pro Rata Share of the aggregate
Purchase Price of the Purchaser Interests of such Incremental Purchase or (ii)
in the case of a Financial Institution, such Financial Institution's Pro Rata
Share of the aggregate Purchase Price of the Purchaser Interests the Financial
Institutions in such Financial Institution's Purchaser Group are then
purchasing. Each Financial Institution's Commitment hereunder shall be limited
to purchasing Purchaser Interests that the Company in such Financial
Institution's Purchaser Group has declined to purchase. Each Financial
Institution's obligation shall be several, such that the failure of any
Financial Institution to make available to Seller any funds in connection with
any purchase shall not relieve any other Financial Institution of its
obligation, if any, hereunder to make funds available on the date of such
purchase, but no Financial Institution shall be responsible for the failure of
any other Financial Institution to make funds available in connection with any
purchase.
Section 1.3 Decreases. Seller shall provide the Agent and Scotia
with prior written notice in conformity with the Required Notice Period (a
"Reduction Notice") of any proposed reduction of Aggregate Capital from
Collections and the Agent will promptly notify each Purchaser in the Bank One
Company's Purchaser Group of such Reduction Notice after the Agent's receipt
thereof and Scotia will promptly notify each Purchaser in the Scotia Company's
Purchaser Group of such Reduction Notice after Scotia's receipt thereof. Such
Reduction Notice shall designate (i) the date (the "Proposed Reduction Date")
upon which any such reduction of Aggregate Capital shall occur (which date shall
give effect to the applicable Required Notice Period), and (ii) the amount of
Aggregate Capital to be reduced which shall be applied ratably to the Purchaser
Interests of the Companies and the Financial Institutions in accordance with
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the amount of Capital (if any) owing to the Companies (ratably, based on their
respective Pro Rata Shares), on the one hand, and the amount of Capital (if any)
owing to the Financial Institutions (ratably to each Financial Institution,
based on the ratio of such Financial Institution's Capital at such time to the
aggregate Capital of all of the Financial Institutions at such time), on the
other hand (the "Aggregate Reduction"). Only one (1) Reduction Notice shall be
outstanding at any time. Concurrently with any reduction of Aggregate Capital
pursuant to this Section, Seller shall pay to the applicable Purchaser all
Broken Funding Costs arising as a result of such reduction. No Aggregate
Reduction will be made following the occurrence of the Amortization Date without
the consent of the Agent.
Section 1.4 Payment Requirements. All amounts to be paid or
deposited by any Seller Party pursuant to any provision of this Agreement shall
be paid or deposited in accordance with the terms hereof no later than 11:00
a.m. (Chicago time) on the day when due in immediately available funds, and if
not received before 11:00 a.m. (Chicago time) shall be deemed to be received on
the next succeeding Business Day. If such amounts are payable to a Purchaser,
they shall be paid to such Purchaser at the "Payment Address" specified for such
Purchaser on Schedule A or such other address specified in writing to each other
party hereto. If such amounts are payable to the Agent, they shall be paid to
the Agent at ▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ until otherwise notified
by the Agent. Upon notice to Seller, the Agent (on behalf of itself and/or any
Purchaser) may debit the Facility Account for all amounts due and payable
hereunder. All computations of Yield, per annum fees or discount calculated as
part of any CP Costs, per annum fees hereunder and per annum fees under the Fee
Letters shall be made on the basis of a year of 360 days for the actual number
of days elapsed. If any amount hereunder or under any other Transaction Document
shall be payable on a day which is not a Business Day, such amount shall be
payable on the next succeeding Business Day.
ARTICLE II
PAYMENTS AND COLLECTIONS
Section 2.1 Payments. Notwithstanding any limitation on recourse
contained in this Agreement, Seller shall immediately pay to the Agent or
relevant Purchaser, as applicable, when due, for the account of the Agent or the
relevant Purchaser or Purchasers on a full recourse basis, (i) such fees as set
forth in the Fee Letters (which fees collectively shall be sufficient to pay all
fees owing to the Financial Institutions), (ii) all CP Costs, (iii) all amounts
payable as Yield, (iv) all amounts payable as Deemed Collections (which shall be
immediately due and payable by Seller and applied to reduce outstanding
Aggregate Capital hereunder in accordance with Sections 2.2 and 2.3 hereof), (v)
all amounts required pursuant to Section 2.6, (vi) all amounts payable pursuant
to Article X, if any, (vii) all Servicer costs and expenses, including the
Servicing Fee, in connection with servicing, administering and collecting the
Receivables, (viii) all Broken Funding Costs and (ix) all Default Fees
(collectively, the "Obligations"). If any Person fails to pay any of the
Obligations when due, such Person agrees to pay, on demand, the Default Fee in
respect thereof until paid. Notwithstanding the foregoing, no provision of this
Agreement or the Fee Letters shall require the payment or permit the collection
of
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any amounts hereunder in excess of the maximum permitted by applicable law. If
at any ▇▇▇▇ ▇▇▇▇▇▇ receives any Collections or is deemed to receive any
Collections, Seller shall immediately pay such Collections or Deemed Collections
to the Servicer for application in accordance with the terms and conditions
hereof and, at all times prior to such payment, such Collections or Deemed
Collections shall be held in trust by Seller for the exclusive benefit of the
Purchasers and the Agent.
Section 2.2 Collections Prior to Amortization. Prior to the
Amortization Date, any Collections and/or Deemed Collections received by the
Servicer shall be set aside and held in trust by the Servicer for the benefit of
the Agent and the Purchasers for the payment of any accrued and unpaid Aggregate
Unpaids or for a Reinvestment as provided in this Section 2.2. If at any time
any Collections and/or Deemed Collections are received by the Servicer prior to
the Amortization Date, (i) the Servicer shall set aside the Termination
Percentage (hereinafter defined) of Collections evidenced by the Purchaser
Interests of each Terminating Financial Institution, shall set aside Collections
to be used to effect any Aggregate Reduction in accordance with Section 1.3 and
shall set aside amounts necessary to pay Obligations due on the next succeeding
Settlement Date and (ii) Seller hereby requests and the Purchasers (other than
any Terminating Financial Institutions) hereby agree to make, simultaneously
with such receipt, a reinvestment (each a "Reinvestment") with that portion of
the balance of each and every Collection and Deemed Collection received by the
Servicer that is part of any Purchaser Interest (other than any Purchaser
Interests of Terminating Financial Institutions), such that after giving effect
to such Reinvestment, the amount of Capital of such Purchaser Interest
immediately after such receipt and corresponding Reinvestment shall be equal to
the amount of Capital immediately prior to such receipt (but giving effect to
any ratable reduction thereof pursuant to application of an Aggregate
Reduction). On each Settlement Date prior to the occurrence of the Amortization
Date, the Servicer shall remit to the Agent's or applicable Purchaser's account
the amounts set aside during the preceding Settlement Period that have not been
subject to a Reinvestment and apply such amounts (if not previously paid in
accordance with Section 2.1) first, to reduce unpaid Obligations and second, to
reduce the Capital of all Purchaser Interests of Terminating Financial
Institutions, applied ratably to each Terminating Financial Institution
according to its respective Termination Percentage. If such Capital and
Obligations shall be reduced to zero, any additional Collections received by the
Servicer (i) if applicable, shall be remitted to the Agent's or applicable
Purchaser's account no later than 11:00 a.m. (Chicago time) to the extent
required to fund any Aggregate Reduction on such Settlement Date and (ii) any
balance remaining thereafter shall be remitted from the Servicer to Seller on
such Settlement Date. Each Terminating Financial Institution shall be allocated
a ratable portion of Collections from the Liquidity Termination Date that such
Terminating Financial Institution did not consent to extend (as to such
Terminating Financial Institution, the "Liquidity Provider Termination Date"),
until such Terminating Financial Institution's Capital shall be paid in full.
This ratable portion shall be calculated on the Liquidity Provider Termination
Date of each Terminating Financial Institution as a percentage equal to (i)
Capital of such Terminating Financial Institution outstanding on its Liquidity
Provider Termination Date, divided by (ii) the Aggregate Capital outstanding on
such Liquidity Provider Termination Date (the
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"Termination Percentage"). Each Terminating Financial Institution's Termination
Percentage shall remain constant prior to the Amortization Date. On and after
the Amortization Date, each Termination Percentage shall be disregarded, and
each Terminating Financial Institution's Capital shall be reduced ratably with
all Financial Institutions in accordance with Section 2.3.
Section 2.3 Collections Following Amortization. On the Amortization
Date and on each day thereafter, the Servicer shall set aside and hold in trust,
for the holder of each Purchaser Interest, all Collections received on such day
and an additional amount for the payment of any Aggregate Unpaids owed by Seller
and not previously paid by Seller in accordance with Section 2.1. On and after
the Amortization Date, the Servicer shall, at any time upon the request from
time to time by (or pursuant to standing instructions from) the Agent (i) remit
to the Agent's or applicable Purchaser's account the amounts set aside pursuant
to the preceding sentence, and (ii) apply such amounts to reduce the Capital
associated with each such Purchaser Interest and any other Aggregate Unpaids.
Section 2.4 Application of Collections. If there shall be
insufficient funds on deposit for the Servicer to distribute funds in payment in
full of the aforementioned amounts pursuant to Section 2.2 or 2.3 (as
applicable), the Servicer shall distribute funds:
first, to the payment of the Servicer's reasonable out-of-pocket
costs and expenses in connection with servicing, administering and
collecting the Receivables, including the Servicing Fee, if Seller or one
of its Affiliates is not then acting as the Servicer,
second, to the reimbursement of the Agent's and the Purchasers'
costs of collection and enforcement of this Agreement,
third, ratably to the payment of all accrued and unpaid fees
under the Fee Letters, CP Costs and Yield,
fourth, (to the extent applicable) to the ratable reduction of
the Aggregate Capital (without regard to any Termination Percentage),
fifth, for the ratable payment of all other unpaid Obligations,
provided that to the extent such Obligations relate to the payment of
Servicer costs and expenses, including the Servicing Fee, when Seller or
one of its Affiliates is acting as the Servicer, such costs and expenses
will not be paid until after the payment in full of all other Obligations,
and
sixth, after the Aggregate Unpaids have been indefeasibly reduced to
zero, to Seller.
Collections applied to the payment of Aggregate Unpaids shall be
distributed in accordance with the aforementioned provisions, and, giving effect
to each
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of the priorities set forth in Section 2.4 above, shall be shared ratably
(within each priority) among the Agent and the Purchasers in accordance with the
amount of such Aggregate Unpaids owing to each of them in respect of each such
priority.
Section 2.5 Payment Rescission. No payment of any of the Aggregate
Unpaids shall be considered paid or applied hereunder to the extent that, at any
time, all or any portion of such payment or application is rescinded by
application of law or judicial authority, or must otherwise be returned or
refunded for any reason. Seller shall remain obligated for the amount of any
payment or application so rescinded, returned or refunded, and shall promptly
pay to the Agent (for application to the Person or Persons who suffered such
rescission, return or refund) the full amount thereof, plus the Default Fee from
the date of any such rescission, return or refunding.
Section 2.6 Maximum Purchaser Interests. Seller shall ensure that
the Purchaser Interests of the Purchasers shall at no time exceed in the
aggregate 100%. If the aggregate of the Purchaser Interests of the Purchasers
exceeds 100%, Seller shall pay to the Purchasers (ratably based on the ratio of
each Purchaser's Capital at such time to the Aggregate Capital at such time)
within one (1) Business Day an amount to be applied to reduce the Aggregate
Capital, such that after giving effect to such payment the aggregate of the
Purchaser Interests equals or is less than 100%.
Section 2.7 Clean Up Call. In addition to Seller's rights pursuant
to Section 1.3, Servicer shall have the right (after providing written notice to
the Agent and Scotia in accordance with the Required Notice Period), at any time
following the reduction of the Aggregate Capital to a level that is less than
10.0% of the maximum amount drawn, to repurchase from the Purchasers all, but
not less than all, of the then outstanding Purchaser Interests. The purchase
price in respect thereof shall be an amount equal to the Aggregate Unpaids
through the date of such repurchase, payable in immediately available funds.
Such repurchase shall be without representation, warranty or recourse of any
kind by, on the part of, or against any Purchaser or the Agent.
Section 2.8 Release of Lock-Box Arrangements. After all Aggregate
Unpaids have been reduced to zero, the Agent and Purchasers agree that the
Collection Account Agreements maintained pursuant to Section 7.1(j) hereof for
the benefit of the Purchasers shall be terminated and any amounts remaining in
such accounts shall be released to Seller, provided, however, if any amounts
paid to the Agent or Purchaser is voided, limited or otherwise required to be
disgorged by any Purchaser in a bankruptcy, insolvency, reorganization or other
proceeding, each Seller Party hereby agrees to use its best efforts to reinstate
such Lock-Box arrangements and Collection Account Agreements, and hereby grants
a power of attorney (which shall be irrevocable and coupled with an interest) to
the Agent and hereby authorizes the Agent, on its behalf, to execute Lock-Box
arrangements and Collection Account Agreements in the event of any such
reinstatement.
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ARTICLE III
COMPANY FUNDING
Section 3.1 CP Costs. Seller shall pay CP Costs with respect to the
Capital associated with each Purchaser Interest of the Companies for each day
that any Capital in respect of any such Purchaser Interest is outstanding.
Section 3.2 CP Costs Payments. On each Settlement Date, Seller shall
pay to each Company an aggregate amount equal to all accrued and unpaid Company
Costs in respect of the Capital associated with all Purchaser Interests of such
Company for the immediately preceding Accrual Period in accordance with Article
II.
Section 3.3 Calculation of CP Costs. On the fifth Business Day
immediately preceding each Settlement Date, each Company shall calculate the
aggregate amount of its Company Costs for the applicable Accrual Period and
shall notify the Agent of such aggregate amount. Within two (2) Business Days of
the Agent's receipt of notification of such Company Costs for all Companies, the
Agent shall calculate the aggregate amount of CP Costs due and payable on the
applicable Settlement Date and shall notify Seller of the aggregate amount of
the CP Costs due and payable on the applicable Settlement Date and shall notify
Seller of the aggregate amount of the Company Costs due and payable on such
Settlement Date to each Company.
ARTICLE IV
FINANCIAL INSTITUTION FUNDING
Section 4.1 Financial Institution Funding. Each Purchaser Interest
of the Financial Institutions shall accrue Yield for each day during its Tranche
Period at either the LIBO Rate or the Prime Rate in accordance with the terms
and conditions hereof. Until Seller gives notice to the Agent of a change in the
rate applicable to the Discount Rate in accordance with Section 4.4, the initial
Discount Rate for any Purchaser Interest transferred to the Financial
Institutions pursuant to the terms and conditions hereof shall be the Prime
Rate. If any Purchaser Interest of any Company is assigned or transferred to, or
funded by, any Funding Source of such Company pursuant to any Funding Agreement
or to or by any other Person, each such Purchaser Interest so assigned,
transferred or funded shall each be deemed to have a new Tranche Period
commencing on the date of any such transfer or funding and shall accrue Yield
for each day during its Tranche Period at either the LIBO Rate or the Prime Rate
in accordance with the terms and conditions hereof as if each such Purchaser
Interest was held by a Financial Institution, and with respect to each such
Purchaser Interest, the assignee or transferee thereof or lender with respect
thereto shall be deemed to be a Financial Institution in the transferring
Company's Purchaser Group solely for the purposes of Sections 4.1, 4.2, 4.3, 4.4
and 4.5.
Section 4.2 Yield Payments. On the Settlement Date for each
Purchaser Interest of each Financial Institution, Seller shall pay to each
Financial Institution an aggregate amount equal to all accrued and unpaid Yield
for the entire Tranche Period of each Purchaser Interest funded by such
Financial Institution. On the
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Page 8
fifth Business Day immediately preceding the Settlement Date for each Purchaser
Interest of the Financial Institutions, each Financial Institution shall
calculate the aggregate amount of accrued and unpaid Yield for the entire
Tranche Period of each Purchaser Interest funded by such Financial Institution
and shall notify the Agent of such aggregate amount. Within two Business Days of
the Agent's receipt of notification of such applicable Yield for all Financial
Institutions, the Agent shall calculate the aggregate amount of Yield due and
payable on the applicable Settlement Date and shall notify Seller of the
aggregate amount of Yield due and payable on such Settlement Date to each
Financial Institution.
Section 4.3 Selection and Continuation of Tranche Periods.
(a) With consultation from (and approval by) the applicable
Financial Institution, Seller shall from time to time request Tranche Periods
for the Purchaser Interests of the Financial Institutions, provided that, if at
any time the Financial Institutions shall have a Purchaser Interest, Seller
shall always request Tranche Periods such that at least one Tranche Period shall
end on the date specified in clause (A) of the definition of Settlement Date.
(b) Seller or the applicable Financial Institution, upon
notice to and consent by the other received at least three (3) Business Days
prior to the end of a Tranche Period (the "Terminating Tranche") for any
Purchaser Interest, may, effective on the last day of the Terminating Tranche:
(i) divide any such Purchaser Interest into multiple Purchaser Interests by
subdividing the associated Capital for such Purchaser Interest into smaller
amounts of Capital, (ii) combine any such Purchaser Interest with one or more
other Purchaser Interests that have a Terminating Tranche ending on the same day
as such Terminating Tranche by combining the associated Capital for such
Purchaser Interests or (iii) combine any such Purchaser Interest with a new
Purchaser Interest to be purchased on the day such Terminating Tranche ends by
combining the associated Capital for such Purchaser Interests; provided that in
no event may a Purchaser Interest of any Purchaser be combined with a Purchaser
Interest of any other Purchaser.
Section 4.4 Financial Institution Discount Rates. Seller may select
the LIBO Rate or the Prime Rate for each Purchaser Interest of the Financial
Institutions. Seller shall by 11:00 a.m. (Chicago time): (i) at least three (3)
Business Days prior to the expiration of any Terminating Tranche with respect to
which the LIBO Rate is being requested as a new Discount Rate and (ii) at least
one (1) Business Day prior to the expiration of any Terminating Tranche with
respect to which the Prime Rate is being requested as a new Discount Rate, give
the applicable Financial Institution irrevocable notice of the new Discount Rate
for the Purchaser Interest associated with such Terminating Tranche. Until
Seller gives notice to the applicable Financial Institution (or Funding Source)
of another Discount Rate, the initial Discount Rate for any Purchaser Interest
transferred to the Financial Institutions pursuant to the terms and conditions
hereof (or assigned or transferred to, or funded by, any Funding Source pursuant
to any Funding Agreement or to or by any other Person) shall be the Prime Rate.
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Section 4.5 Suspension of the LIBO Rate. If any Financial
Institution notifies the Agent that it has determined that funding its Pro Rata
Share of the Purchaser Interests of the Financial Institutions in such Financial
Institution's Purchaser Group at the LIBO Rate would violate any applicable law,
rule, regulation, or directive of any governmental or regulatory authority,
whether or not having the force of law, or that (i) deposits of a type and
maturity appropriate to match fund its Purchaser Interests at the LIBO Rate are
not available or (ii) the LIBO Rate does not accurately reflect the cost of
acquiring or maintaining a Purchaser Interest at the LIBO Rate, then the Agent
shall suspend the availability of the LIBO Rate for the Financial Institutions
in such Financial Institution's Purchaser Group and require Seller to select the
Prime Rate for any Purchaser Interest funded by the Financial Institutions in
such Financial Institution's Purchaser Group accruing Yield at the LIBO Rate.
Section 4.6 Extension of Liquidity Termination Date.
(a) Seller may request one or more 364-day extensions of the
Liquidity Termination Date then in effect by giving written notice of such
request to the Agent (each such notice an "Extension Notice") at least 60 days
prior to the Liquidity Termination Date then in effect. After the Agent's
receipt of any Extension Notice, the Agent shall promptly advise each Financial
Institution of such Extension Notice. Each Financial Institution may, in its
sole discretion, by a revocable notice (a "Consent Notice") given to the Agent
on or prior to the 30th day prior to the Liquidity Termination Date then in
effect (such period from the date of the Extension Notice to such 30th day being
referred to herein as the "Consent Period"), consent to such extension of such
Liquidity Termination Date; provided, however, that, except as provided in
Section 4.6(b), such extension shall not be effective with respect to any of the
Financial Institutions if any one or more Financial Institutions: (i) notifies
the Agent during the Consent Period that such Financial Institution either does
not wish to consent to such extension or wishes to revoke its prior Consent
Notice or (ii) fails to respond to the Agent within the Consent Period (each
Financial Institution that does not wish to consent to such extension or wishes
to revoke its prior Consent Notice or fails to respond to the Agent within the
Consent Period is herein referred to as a "Non-Renewing Financial Institution").
If none of the events described in the foregoing clauses (i) or (ii) occurs
during the Consent Period and all Consent Notices have been received, then, the
Liquidity Termination Date shall be irrevocably extended until the date that is
364 days after the Liquidity Termination Date then in effect. The Agent shall
promptly notify Seller of any Consent Notice or other notice received by the
Agent pursuant to this Section 4.6(a).
(b) Upon receipt of notice from the Agent pursuant to Section
4.6(a) of any Non-Renewing Financial Institution or that the Liquidity
Termination Date has not been extended, one or more of the Financial
Institutions (including any Non-Renewing Financial Institution) may proffer to
the Agent and the Company in such Non-Renewing Financial Institution's Purchaser
Group the names of one or more institutions meeting the criteria set forth in
Section 12.1(b)(i) that are willing to accept assignments of and assume the
rights and obligations under this Agreement and the other applicable Transaction
Documents of the Non-Renewing Financial Institution. Provided the
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proffered name(s) are acceptable to the Agent and the Company in such
Non-Renewing Financial Institution's Purchaser Group, the Agent shall notify the
remaining Financial Institutions of such fact, and the then existing Liquidity
Termination Date shall be extended for an additional 364 days upon satisfaction
of the conditions for an assignment in accordance with Section 12.1 and the
Commitment of each Non-Renewing Financial Institution shall be reduced to zero.
If the rights and obligations under this Agreement and the other applicable
Transaction Documents of each Non-Renewing Financial Institution are not
assigned as contemplated by this Section 4.6(b) (each such Non-Renewing
Financial Institution whose rights and obligations under this Agreement and the
other applicable Transaction Documents are not so assigned is herein referred to
as a "Terminating Financial Institution") and at least one Financial Institution
is not a Non-Renewing Financial Institution, the then existing Liquidity
Termination Date shall be extended for an additional 364 days; provided,
however, that (i) the Purchase Limit shall be reduced on the Liquidity Provider
Termination Date applicable to each Terminating Financial Institution by an
aggregate amount equal to the Terminating Commitment Availability of each
Terminating Financial Institution as of such date and shall thereafter continue
to be reduced by amounts equal to any reduction in the Capital of any
Terminating Financial Institution (after application of Collections pursuant to
Sections 2.2 and 2.3), (ii) the Company Purchase Limit of each Company shall be
reduced by the aggregate amount of the Terminating Commitment Amount of each
Terminating Financial Institution in such Company's Purchaser Group and (iii)
the Commitment of each Terminating Financial Institution shall be reduced to
zero on the Liquidity Provider Termination Date applicable to such Terminating
Financial Institution. Upon reduction to zero of the Capital of all of the
Purchaser Interests of a Terminating Financial Institution (after application of
Collections thereto pursuant to Sections 2.2 and 2.3) all rights and obligations
of such Terminating Financial Institution hereunder shall be terminated and such
Terminating Financial Institution shall no longer be a "Financial Institution";
provided, however, that the provisions of Article X shall continue in effect for
its benefit with respect to Purchaser Interests held by such Terminating
Financial Institution prior to its termination as a Financial Institution.
(c) Any requested extension may be approved or disapproved by
a Financial Institution in its sole discretion. In the event that the
Commitments are not extended in accordance with the provisions of this Section
4.6, the Commitment of each Financial Institution shall be reduced to zero on
the Liquidity Termination Date. Upon reduction to zero of the Commitment of a
Financial Institution and upon reduction to zero of the Capital of all of the
Purchaser Interests of such Financial Institution all rights and obligations of
such Financial Institution hereunder shall be terminated and such Financial
Institution shall no longer be a "Financial Institution"; provided, however,
that the provisions of Article X shall continue in effect for its benefit with
respect to Purchaser Interests held by such Financial Institution prior to its
termination as a Financial Institution.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of The Seller Parties.
Each Seller Party hereby represents and warrants to the Agent and the
Purchasers, as to itself (and not as to any other Seller Party), as of the date
hereof and as of the date of each Incremental Purchase and the date of each
Reinvestment that:
(a) Corporate Existence and Power. Such Seller Party is a
corporation duly organized, validly existing and in good standing under the laws
of its state of incorporation. Such Seller Party is duly qualified to do
business and is in good standing as a foreign corporation, and has and holds all
corporate power and all governmental licenses, authorizations, consents and
approvals required to carry on its business in each jurisdiction in which its
business is conducted, except where the failure of the Servicer to so qualify or
so hold could not reasonably be expected to have a Material Adverse Effect.
(b) Power and Authority; Due Authorization, Execution and
Delivery. The execution and delivery by such Seller Party of this Agreement and
each other Transaction Document to which it is a party, and the performance of
its obligations hereunder and thereunder and, in the case of Seller, Seller's
use of the proceeds of purchases made hereunder, are within its corporate powers
and authority and have been duly authorized by all necessary corporate action on
its part. This Agreement and each other Transaction Document to which such
Seller Party is a party has been duly executed and delivered by such Seller
Party.
(c) No Conflict. The execution and delivery by such Seller
Party of this Agreement and each other Transaction Document to which it is a
party, and the performance of its obligations hereunder and thereunder do not
contravene or violate (i) its certificate or articles of incorporation or
by-laws, (ii) any law, rule or regulation applicable to it, (iii) any
restrictions under any agreement, contract or instrument to which it is a party
or by which it or any of its property is bound, or (iv) any order, writ,
judgment, award, injunction or decree binding on or affecting it or its
property, and do not result in the creation or imposition of any Adverse Claim
on assets of such Seller Party or its Subsidiaries (except as created
hereunder); and no transaction contemplated hereby requires compliance with any
bulk sales act or similar law.
(d) Governmental Authorization. Other than the filing of the
financing statements required hereunder, no authorization or approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution and delivery by such Seller
Party of this Agreement and each other Transaction Document to which it is a
party and the performance of its obligations hereunder and thereunder.
(e) Actions, Suits. There are no actions, suits or proceedings
pending, or to the best of such Seller Party's knowledge, threatened, against or
affecting such Seller Party, or any of its properties, in or before any court,
arbitrator or other body,
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except for actions, suits or proceedings (i) that, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect or
(ii) that have been publicly disclosed in any periodic report or other filing
made by such Seller Party pursuant to, and in full conformity with the
requirements of, the Securities Exchange Act of 1934. In addition to the
foregoing, there are no actions, suits or proceedings pending, or to the best of
such Seller Party's knowledge, threatened against or affecting the Receivables,
the Related Security or any Transaction Document, in or before any court,
arbitration or other body. Such Seller Party is not in default with respect to
any order of any court, arbitrator or governmental body.
(f) Binding Effect. This Agreement and each other Transaction
Document to which such Seller Party is a party constitute the legal, valid and
binding obligations of such Seller Party enforceable against such Seller Party
in accordance with their respective terms, except as such enforcement may be
limited by applicable bankruptcy, insolvency, reorganization or other similar
laws relating to or limiting creditors' rights generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
(g) Accuracy of Information. All information heretofore
furnished by such Seller Party or any of its Affiliates to the Agent or the
Purchasers for purposes of or in connection with this Agreement, any of the
other Transaction Documents or any transaction contemplated hereby or thereby
is, and all such information hereafter furnished by such Seller Party or any of
its Affiliates to the Agent or the Purchasers will be, true and accurate in
every material respect on the date such information is stated or certified and
does not and will not contain any material misstatement of fact or omit to state
a material fact or any fact necessary to make the statements contained therein
not misleading.
(h) Use of Proceeds. No proceeds of any purchase hereunder
will be used (i) for a purpose that violates, or would be inconsistent with,
Regulation T, U or X promulgated by the Board of Governors of the Federal
Reserve System from time to time or (ii) to acquire any security in any
transaction which is subject to Section 12, 13 or 14 of the Securities Exchange
Act of 1934, as amended.
(i) Good Title. Immediately prior to each purchase hereunder,
Seller shall be the legal and beneficial owner of the Receivables and Related
Security with respect thereto, free and clear of any Adverse Claim, except as
created by the Transaction Documents. There have been duly filed all financing
statements or other similar instruments or documents necessary under the UCC (or
any comparable law) of all appropriate jurisdictions to perfect Seller's
ownership interest in each Receivable, its Collections and the Related Security.
(j) Perfection. This Agreement, together with the filing of
the financing statements contemplated hereby, is effective to, and shall, upon
each purchase hereunder, transfer to the Agent for the benefit of the relevant
Purchaser or Purchasers (and the Agent for the benefit of such Purchaser or
Purchasers shall acquire from Seller) a valid and perfected first priority
undivided percentage ownership or security interest in
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each Receivable existing or hereafter arising and in the Related Security and
Collections with respect thereto, free and clear of any Adverse Claim, except as
created by the Transaction Documents. There have been duly filed all financing
statements or other similar instruments or documents necessary under the UCC (or
any comparable law) of all appropriate jurisdictions to perfect the Agent's (on
behalf of the Purchasers) ownership or security interest in the Receivables, the
Related Security and the Collections.
(k) Places of Business, Jurisdiction of Organization and
Locations of Records. The principal places of business, jurisdiction of
organization and chief executive office of such Seller Party and the offices
where it keeps all of its Records are located at the address(es) listed on
Exhibit III or such other locations of which the Agent has been notified in
accordance with Section 7.2(a) in jurisdictions where all action required by
Section 7.1(h) and/or Section 13.4(a) has been taken and completed. Seller's
organizational number assigned to it by its jurisdiction of organization and
Seller's Federal Employer Identification Number are correctly set forth on
Exhibit III. Seller has not changed the location of its principal place of
business and chief executive office or its corporate structure within the four
months prior to June 28, 2001. Seller has not changed its jurisdiction of
organization. Seller is a Delaware corporation and is a "registered
organization" (within the meaning of Section 9-102 of the UCC in effect in the
State of Delaware). Servicer is a New York corporation and is a "registered
organization" (within the meaning of Section 9-102 of the UCC in effect in the
State of New York).
(l) Collections. The conditions and requirements set forth in
Section 7.1(j) and Section 8.2 have at all times been satisfied and duly
performed. The names and addresses of all Collection Banks, together with the
account numbers of the Collection Accounts of Seller at each Collection Bank and
the post office box number of each Lock-Box, are listed on Exhibit IV. Seller
has not granted any Person, other than the Agent as contemplated by this
Agreement, dominion and control or "control" (within the meaning of Section
9-104 of the UCC of all applicable jurisdictions) of any Lock-Box or Collection
Account, or the right to take dominion and control or "control" (within the
meaning of Section 9-104 of the UCC of all applicable jurisdictions) of any such
Lock-Box or Collection Account at a future time or upon the occurrence of a
future event. Seller has taken all steps necessary to ensure that the Agent has
"control" (within the meaning of Section 9-104 of the UCC of all applicable
jurisdictions) over all its Collection Accounts and Lock-Boxes.
(m) Material Adverse Effect. (i) The initial Servicer
represents and warrants that since March 31, 2001, no event has occurred that
would have a material adverse effect on the financial condition or operations of
the initial Servicer and its Subsidiaries or the ability of the initial Servicer
to perform its obligations under this Agreement, and (ii) Seller represents and
warrants that since June 28, 2001, no event has occurred that would have a
material adverse effect on (A) the financial condition or operations of Seller,
(B) the ability of Seller to perform its obligations under the Transaction
Documents, or (C) the collectibility of the Receivables generally or any
material portion of the Receivables.
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(n) Names. In the past five (5) years, Seller has not used any
corporate names, trade names or assumed names other than the name in which it
has executed this Agreement.
(o) Ownership of Seller. Originator owns, directly or
indirectly, 100% of the issued and outstanding capital stock of Seller, free and
clear of any Adverse Claim. Such capital stock is validly issued, fully paid and
nonassessable, and there are no options, warrants or other rights to acquire
securities of Seller.
(p) Not a Holding Company or an Investment Company. Such
Seller Party is not a "holding company" or a "subsidiary holding company" of a
"holding company" within the meaning of the Public Utility Holding Company Act
of 1935, as amended, or any successor statute. Such Seller Party is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, or any successor statute.
(q) Compliance with Law. Such Seller Party has complied in all
respects with all applicable laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject, except where the
failure to so comply could not reasonably be expected to have a Material Adverse
Effect. Seller represents that each Receivable, together with the Contract
related thereto, does not contravene any laws, rules or regulations applicable
thereto (including, without limitation, laws, rules and regulations relating to
truth in lending, fair credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices and privacy), and no part of such
Contract is in violation of any such law, rule or regulation.
(r) Compliance with Credit and Collection Policy. Seller has
complied in all material respects with the Credit and Collection Policy with
regard to each Receivable and the related Contract, and has not made any
material change to such Credit and Collection Policy, except as permitted in
accordance with Section 7.2(c) and except such material change as to which the
Agent has been notified in accordance with Section 7.1(a)(vii).
(s) Payments to Originator. Seller represents that with
respect to each Receivable transferred to Seller under the Receivables Sale
Agreement, Seller has given reasonably equivalent value to Originator in
consideration therefor and such transfer was not made for or on account of an
antecedent debt. Seller represents that no transfer by Originator of any
Receivable under the Receivables Sale Agreement is or may be voidable under any
section of the Bankruptcy Reform Act of 1978 (11 U.S.C. Sections 101 et
seq.), as amended.
(t) Enforceability of Contracts. Seller represents that each
Contract with respect to each Receivable is effective to create, and has
created, a legal, valid and binding obligation of the related Obligor to pay the
Outstanding Balance of the Receivable created thereunder and any accrued
interest thereon, if any, enforceable against the Obligor in accordance with its
terms, except as such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws
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relating to or limiting creditors' rights generally and by general principles of
equity (regardless of whether enforcement is sought in a proceeding in equity or
at law).
(u) Eligible Receivables. Each Receivable included in the Net
Receivables Balance as an Eligible Receivable on the date of its purchase under
the Receivables Sale Agreement was an Eligible Receivable on such purchase date.
(v) Net Receivables Balance. At all times from June 28, 2001,
the Net Receivables Balance is at least equal to the sum of (i) the Aggregate
Capital, plus (ii) the Aggregate Reserves.
(w) Accounting. The manner in which such Seller Party accounts
for the transactions contemplated by this Agreement and the Receivables Sale
Agreement does not jeopardize the true sale analysis of the sale of Receivables
by Originator to Seller.
Section 5.2 Financial Institution Representations and Warranties. Each
Financial Institution hereby represents and warrants to the Agent and the
Company in such Financial Institution's Purchaser Group that:
(a) Existence and Power. Such Financial Institution is a
corporation or a banking association duly organized, validly existing and in
good standing under the laws of its jurisdiction of incorporation or
organization, and has all corporate power to perform its obligations hereunder.
(b) No Conflict. The execution and delivery by such Financial
Institution of this Agreement and the performance of its obligations hereunder
are within its corporate powers, have been duly authorized by all necessary
corporate action, do not contravene or violate (i) its certificate or articles
of incorporation or association or by-laws, (ii) any law, rule or regulation
applicable to it, (iii) any restrictions under any agreement, contract or
instrument to which it is a party or by which any of its property is bound, or
(iv) any order, writ, judgment, award, injunction or decree binding on or
affecting it or its property, and do not result in the creation or imposition of
any Adverse Claim on its assets. This Agreement has been duly authorized,
executed and delivered by such Financial Institution.
(c) Governmental Authorization. No authorization or approval
or other action by, and no notice to or filing with, any governmental authority
or regulatory body is required for the due execution and delivery by such
Financial Institution of this Agreement and the performance of its obligations
hereunder, except that has already been received.
(d) Binding Effect. This Agreement constitutes the legal,
valid and binding obligation of such Financial Institution enforceable against
such Financial Institution in accordance with its terms, except as such
enforcement may be limited by applicable bankruptcy, insolvency, reorganization
or other similar laws relating to or
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limiting creditors' rights generally and by general principles of equity
(regardless of whether such enforcement is sought in a proceeding in equity or
at law).
ARTICLE VI
CONDITIONS OF PURCHASES
Section 6.1 Conditions Precedent to Initial Incremental Purchase.
The initial Incremental Purchase of a Purchaser Interest under, and the
effectiveness of, this Agreement is subject to the conditions precedent that (a)
the Agent, Scotia and their respective auditors shall have completed a due
diligence review satisfactory to the Agent and Scotia of the Originator's
operating locations, (b) the Purchasers shall have obtained approval of the
transactions contemplated hereby by their respective credit committees, (c) the
Agent and Scotia shall have received on or before the date of such purchase
those documents listed on Schedule B, (d) the Agent and the Purchasers shall
have received all fees and expenses required to be paid on or prior to the date
hereof pursuant to the terms of this Agreement and the Fee Letters and (e) the
Servicer, Seller and Originator shall have identified in their general ledger a
legend satisfactory to the Agent describing the sale of the Receivables to
Seller and the purchase of the Purchaser Interests hereunder.
Section 6.2 Conditions Precedent to All Purchases and Reinvestments.
Each purchase of a Purchaser Interest and each Reinvestment shall be subject to
the further conditions precedent that (a) in the case of each such purchase or
Reinvestment: (i) the Servicer shall have delivered to the Agent and Scotia on
or prior to the date of such purchase, in form and substance satisfactory to the
Agent, all Monthly Reports as and when due under Section 8.5 and (ii) upon the
Agent's request, the Servicer shall have delivered to the Agent and Scotia at
least three (3) days prior to such purchase or Reinvestment an interim report
showing the amount of Eligible Receivables only; (b) the Facility Termination
Date shall not have occurred; (c) the Agent shall have received such other
approvals, opinions or documents as it may reasonably request; and (d) on the
date of each such Incremental Purchase or Reinvestment, the following statements
shall be true (and acceptance of the proceeds of such Incremental Purchase or
Reinvestment shall be deemed a representation and warranty by Seller that such
statements are then true):
(i) the representations and warranties set forth in
Section 5.1 are true and correct on and as of the date of such Incremental
Purchase or Reinvestment as though made on and as of such date;
(ii) no event has occurred and is continuing, or would
result from such Incremental Purchase or Reinvestment, that will
constitute an Amortization Event, and no event has occurred and is
continuing, or would result from such Incremental Purchase or
Reinvestment, that would constitute a Potential Amortization Event; and
(iii) the Aggregate Capital does not exceed the Purchase
Limit and the aggregate Purchaser Interests do not exceed 100%.
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It is expressly understood that each Reinvestment shall, unless otherwise
directed by the Agent or any Purchaser, occur automatically on each day that the
Servicer shall receive any Collections without the requirement that any further
action be taken on the part of any Person and notwithstanding the failure of
Seller to satisfy any of the foregoing conditions precedent in respect of such
Reinvestment. The failure of Seller to satisfy any of the foregoing conditions
precedent in respect of any Reinvestment shall give rise to a right of the
Agent, which right may be exercised at any time on demand of the Agent, to
rescind the related purchase and direct Seller to pay to the Agent for the
benefit of the Purchasers an amount equal to the Collections prior to the
Amortization Date that shall have been applied to the affected Reinvestment.
ARTICLE VII
COVENANTS
Section 7.1 Affirmative Covenants of The Seller Parties. Until the
date on which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself (and not as to any other Seller Party), as set forth
below:
(a) Financial Reporting. Such Seller Party will maintain, for
itself and each of its Subsidiaries, a system of accounting established and
administered in accordance with GAAP, and furnish or cause to be furnished to
the Agent and Scotia:
(i) Annual Reporting. Within 120 days after the close of
each of its respective fiscal years, audited, unqualified consolidated
financial statements (which shall include balance sheets, statements of
income and retained earnings and a statement of cash flows) for Avnet, and
its Subsidiaries, for such fiscal year certified in a manner acceptable to
the Agent by independent public accountants of recognized national
standing.
(ii) Quarterly Reporting. Within 60 days after the close
of the first three (3) quarterly periods of each of its respective fiscal
years, consolidated balance sheets of Avnet, and its Subsidiaries, as at
the close of each such period and statements of income and retained
earnings and a statement of cash flows for Avnet, and its Subsidiaries,
for the period from the beginning of such fiscal year to the end of such
quarter, all certified subject to year-end audit adjustments, as to
fairness of presentation, GAAP, and consistency, by its chief financial
officer, chief accounting officer or treasurer.
(iii) Compliance Certificate. Together with the
financial statements required hereunder, a compliance certificate in
substantially the form of Exhibit V signed by such Seller Party's
Authorized Officer and dated the date of such annual financial statement
or such quarterly financial statement, as the case may be.
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(iv) Shareholders Statements and Reports. Promptly upon
the furnishing thereof to the shareholders of Servicer copies of all
financial statements, reports and proxy statements so furnished.
(v) S.E.C. Filings. Promptly upon the filing thereof,
copies of all registration statements and annual, quarterly, monthly or
other regular reports which Originator or any of its Subsidiaries files
with the Securities and Exchange Commission.
(vi) Copies of Notices. Promptly upon its receipt of any
notice, request for consent, financial statements, certification, report
or other communication under or in connection with any Transaction
Document from any Person other than the Agent, copies of the same.
(vii) Change in Credit and Collection Policy. At least
thirty (30) days prior to the effectiveness of any material change in or
material amendment to the Credit and Collection Policy, a copy of the
Credit and Collection Policy then in effect and a notice (A) indicating
such change or amendment, and (B) if such proposed change or amendment
would be reasonably likely to adversely affect the collectibility of the
Receivables or decrease the credit quality of any newly created
Receivables, requesting the Agent's and each Purchaser's consent thereto,
provided that such consent shall not be unreasonably withheld.
(viii) Other Information. Promptly, from time to time,
such other information, documents, records or reports relating to the
Receivables or the condition or operations, financial or otherwise, of
such Seller Party as the Agent may from time to time reasonably request in
order to protect the interests of the Agent and the Purchasers under or as
contemplated by this Agreement.
(b) Notices. Such Seller Party will notify the Agent and
Scotia in writing of any of the following promptly upon learning of the
occurrence thereof, describing the same and, if applicable, the steps being
taken with respect thereto:
(i) Amortization Events or Potential Amortization
Events. The occurrence of each Amortization Event and each Potential
Amortization Event, by a statement of an Authorized Officer of such Seller
Party.
(ii) Judgment and Proceedings. (A) (1) The entry of any
judgment or decree against the Servicer or any of its respective
Subsidiaries if the aggregate amount of all judgments and decrees then
outstanding against the Servicer and its Subsidiaries exceeds $25,000,000
and (2) the institution of any litigation, arbitration proceeding
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or governmental proceeding against the Servicer, which, individually or in
the aggregate, if adversely determined, would reasonably be expected to
result in a judgment in excess of $50,000,000; and (B) the entry of any
judgment or decree or the institution of any litigation, arbitration
proceeding or governmental proceeding against Seller.
(iii) Material Adverse Effect. The occurrence of any
event or condition that has had, or could reasonably be expected to have,
a Material Adverse Effect.
(iv) Termination Date. The occurrence of the
"Termination Date" under and as defined in the Receivables Sale Agreement.
(v) Defaults Under Other Agreements. The occurrence of a
default or an event of default under any other financing arrangement
pursuant to which such Seller Party is a debtor or an obligor.
(vi) Downgrade of Originator. Any downgrade in the
rating of any Indebtedness of Originator by Standard & Poor's Ratings
Services or by ▇▇▇▇▇'▇ Investors Service, Inc., setting forth the
Indebtedness affected and the nature of such change.
(c) Compliance with Laws and Preservation of Corporate
Existence. Such Seller Party will comply in all respects with all applicable
laws, rules, regulations, orders, writs, judgments, injunctions, decrees or
awards to which it may be subject, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect. Such Seller Party will
preserve and maintain its corporate existence, rights, franchises and privileges
in the jurisdiction of its incorporation, and qualify and remain qualified in
good standing as a foreign corporation in each jurisdiction where its business
is conducted, except where the failure of the Servicer to so qualify or to
maintain such qualification could not reasonably be expected to have a Material
Adverse Effect.
(d) Audits. Such Seller Party will furnish to the Agent and
Scotia from time to time such information with respect to it and the Receivables
as the Agent or the Required Purchasers may reasonably request. Such Seller
Party will, from time to time during regular business hours as requested by the
Agent upon reasonable notice and at the sole cost of such Seller Party, permit
the Agent, or its agents or representatives, (i) to examine and make copies of
and abstracts from all Records in the possession or under the control of such
Seller Party relating to the Receivables and the Related Security, including,
without limitation, the related Contracts, and (ii) to visit the offices and
properties of such Seller Party for the purpose of examining such materials
described in clause (i) above, and to discuss matters relating to such Seller
Party's financial condition or the Receivables and the Related Security or any
Seller Party's performance under any of the Transaction Documents or any Seller
Party's performance
AMENDED AND RESTATED
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under the Contracts and, in each case, with any of the officers or employees of
Seller or the Servicer having knowledge of such matters.
(e) Keeping and Marking of Records and Books.
(i) The Servicer will maintain and implement
administrative and operating procedures (including, without limitation, an
ability to recreate records evidencing Receivables in the event of the
destruction of the originals thereof), and keep and maintain all
documents, books, records and other information reasonably necessary or
advisable for the collection of all Receivables (including, without
limitation, records adequate to permit the immediate identification of
each new Receivable and all Collections of and adjustments to each
existing Receivable). The Servicer will give the Agent notice of any
material change in the administrative and operating procedures referred to
in the previous sentence.
(ii) Such Seller Party will (A) on or prior to June 28,
2001, identify in its general ledger a legend, acceptable to the Agent,
describing the Purchaser Interests and (B) upon the request of the Agent
(x) ▇▇▇▇ each Contract with a legend describing the Purchaser Interests
and (y) deliver to the Agent all Contracts (including, without limitation,
all multiple originals of any such Contract) relating to the Receivables.
(f) Compliance with Contracts and Credit and Collection
Policy. Seller will timely and fully (i) perform and comply with all provisions,
covenants and other promises, if any, required to be observed by it under the
Contracts related to the Receivables, and (ii) comply in all respects with the
Credit and Collection Policy in regard to each Receivable and the related
Contract.
(g) Performance and Enforcement of Receivables Sale Agreement.
Seller will, and will require Originator to, perform each of their respective
obligations and undertakings under and pursuant to the Receivables Sale
Agreement, will purchase Receivables thereunder in strict compliance with the
terms thereof and will vigorously enforce the rights and remedies accorded to
Seller under the Receivables Sale Agreement. Seller will take all actions to
perfect and enforce its rights and interests (and the rights and interests of
the Agent and the Purchasers as assignees of Seller) under the Receivables Sale
Agreement as the Agent may from time to time reasonably request, including,
without limitation, making claims to which it may be entitled under any
indemnity, reimbursement or similar provision contained in the Receivables Sale
Agreement.
(h) Ownership. Seller will (or will cause Originator to) take
all necessary action to (i) vest legal and equitable title to the Receivables,
the Related Security and the Collections purchased under the Receivables Sale
Agreement irrevocably in Seller, free and clear of any Adverse Claims other than
Adverse Claims in
AMENDED AND RESTATED
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favor of the Agent and the Purchasers (including, without limitation, the filing
of all financing statements or other similar instruments or documents necessary
under the UCC (or any comparable law) of all appropriate jurisdictions to
perfect Seller's interest in such Receivables, Related Security and Collections
and such other action to perfect, protect or more fully evidence the interest of
Seller therein as the Agent may reasonably request), and (ii) establish and
maintain, in favor of the Agent, for the benefit of the Purchasers, a valid and
perfected first priority undivided percentage ownership interest (and/or a valid
and perfected first priority security interest) in all such Receivables, Related
Security and Collections to the full extent contemplated herein, free and clear
of any Adverse Claims other than Adverse Claims in favor of the Agent for the
benefit of the Purchasers (including, without limitation, the filing of all
financing statements or other similar instruments or documents necessary under
the UCC (or any comparable law) of all appropriate jurisdictions to perfect the
Agent's (for the benefit of the Purchasers) interest in such Receivables,
Related Security and Collections and such other action to perfect, protect or
more fully evidence the interest of the Agent for the benefit of the Purchasers
as the Agent may reasonably request).
(i) Purchasers' Reliance. Seller acknowledges that the
Purchasers are entering into the transactions contemplated by this Agreement in
reliance upon Seller's identity as a legal entity that is separate from
Originator. Therefore, from and after June 28, 2001, Seller shall take all
reasonable steps, including, without limitation, all steps that the Agent or any
Purchaser may from time to time reasonably request, to maintain Seller's
identity as a separate legal entity and to make it manifest to third parties
that Seller is an entity with assets and liabilities distinct from those of
Originator and any Affiliates thereof and not just a division of Originator or
any such Affiliate. Without limiting the generality of the foregoing and in
addition to the other covenants set forth herein, Seller will:
(A) conduct its own business in its own name and require
that all full-time employees of Seller, if any, identify themselves as
such and not as employees of Originator (including, without limitation, by
means of providing appropriate employees with business or identification
cards identifying such employees as Seller's employees);
(B) compensate all employees, consultants and agents
directly, from Seller's own funds, for services provided to Seller by such
employees, consultants and agents and, to the extent any employee,
consultant or agent of Seller is also an employee, consultant or agent of
Originator or any Affiliate thereof, allocate the compensation of such
employee, consultant or agent between Seller and Originator or such
Affiliate, as applicable, on a basis that reflects the services rendered
to Seller and Originator or such Affiliate, as applicable;
(C) clearly identify its offices (by signage or
otherwise) as its offices and, if such office is located in the offices of
Originator, Seller shall lease such office at a fair market rent;
AMENDED AND RESTATED
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(D) have a separate telephone number, which will be
answered only in its name and separate stationery, invoices and checks in
its own name;
(E) conduct all transactions with Originator, the
Servicer and any Affiliate thereof (including, without limitation, any
delegation of its obligations hereunder as Servicer) strictly on an
arm's-length basis, allocate all overhead expenses (including, without
limitation, telephone and other utility charges) for items shared between
Seller and Originator or any Affiliate thereof on the basis of actual use
to the extent practicable and, to the extent such allocation is not
practicable, on a basis reasonably related to actual use;
(F) at all times have a Board of Directors consisting of
three members, at least one member of which is an Independent Director;
(G) observe all corporate formalities as a distinct
entity, and ensure that all corporate actions relating to (A) the
selection, maintenance or replacement of the Independent Director, (B) the
dissolution or liquidation of Seller or (C) the initiation of,
participation in, acquiescence in or consent to any bankruptcy,
insolvency, reorganization or similar proceeding involving Seller, are
duly authorized by unanimous vote of its Board of Directors (including the
Independent Director);
(H) maintain Seller's books and records separate from
those of Originator and any Affiliate thereof and otherwise readily
identifiable as its own assets rather than assets of Originator and any
Affiliate thereof;
(I) prepare its financial statements separately from
those of Originator and insure that any consolidated financial statements
of Originator or any Affiliate thereof that include Seller and that are
filed with the Securities and Exchange Commission or any other
governmental agency have notes clearly stating that Seller is a separate
corporate entity and that its assets will be available first and foremost
to satisfy the claims of the creditors of Seller;
(J) except as herein specifically otherwise provided,
maintain the funds or other assets of Seller separate from, and not
commingled with, those of Originator or any Affiliate thereof (other than
any Excluded Receivables) and only maintain bank accounts or other
depository accounts to which Seller alone is the account party;
(K) pay all of Seller's operating expenses from Seller's
own assets (except for certain payments by Originator or
AMENDED AND RESTATED
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other Persons pursuant to allocation arrangements that comply with the
requirements of this Section 7.1(i));
(L) operate its business and activities such that: it
does not engage in any business or activity of any kind, or enter into any
transaction or indenture, mortgage, instrument, agreement, contract, lease
or other undertaking, other than the transactions contemplated and
authorized by this Agreement and the Receivables Sale Agreement; and does
not create, incur, guarantee, assume or suffer to exist any indebtedness
or other liabilities, whether direct or contingent, other than (1) as a
result of the endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business, (2)
the incurrence of obligations under this Agreement, (3) the incurrence of
obligations, as expressly contemplated in the Receivables Sale Agreement,
to make payment to Originator thereunder for the purchase of Receivables
from Originator under the Receivables Sale Agreement, and (4) the
incurrence of operating expenses in the ordinary course of business of the
type otherwise contemplated by this Agreement;
(M) maintain its corporate charter in conformity with
this Agreement, such that it does not amend, restate, supplement or
otherwise modify its Certificate of Incorporation or By-Laws in any
respect that would impair its ability to comply with the terms or
provisions of any of the Transaction Documents, including, without
limitation, Section 7.1(i) of this Agreement;
(N) maintain the effectiveness of, and continue to
perform under the Receivables Sale Agreement, such that it does not amend,
restate, supplement, cancel, terminate or otherwise modify the Receivables
Sale Agreement, or give any consent, waiver, directive or approval
thereunder or waive any default, action, omission or breach under the
Receivables Sale Agreement or otherwise grant any indulgence thereunder,
without (in each case) the prior written consent of the Agent and the
Required Purchasers;
(O) maintain its corporate separateness such that it
does not merge or consolidate with or into, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions, and except as otherwise contemplated herein) all or
substantially all of its assets (whether now owned or hereafter acquired)
to, or acquire all or substantially all of the assets of, any Person, nor
at any time create, have, acquire, maintain or hold any interest in any
Subsidiary.
(P) maintain at all times the Required Capital Amount
(as defined in the Receivables Sale Agreement) and refrain from making any
dividend, distribution, redemption of capital
AMENDED AND RESTATED
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Page 24
stock or payment of any subordinated indebtedness which would cause the
Required Capital Amount to cease to be so maintained; and
(Q) take such other actions as are necessary on its part
to ensure that the facts and assumptions set forth in the opinion issued
by ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, as counsel for Seller, in connection with
the closing or initial Incremental Purchase under the Original Agreement
and relating to substantive consolidation issues, and in the certificates
accompanying such opinion, remain true and correct in all material
respects at all times.
(j) Collections. Such Seller Party will cause (1) all proceeds
from all Lock-Boxes to be directly deposited by a Collection Bank into a
Collection Account and (2) each Lock-Box and Collection Account to be subject at
all times to a Collection Account Agreement that is in full force and effect. In
the event any payments relating to Receivables are remitted directly to Seller
or any Affiliate of Seller, Seller will remit (or will cause all such payments
to be remitted) directly to a Collection Bank and deposited into a Collection
Account within two (2) Business Days following receipt thereof, and, at all
times prior to such remittance, Seller will itself hold or, if applicable, will
cause such payments to be held in trust for the exclusive benefit of the Agent
and the Purchasers. Seller will maintain exclusive ownership, dominion and
control (subject to the terms of this Agreement) of each Lock-Box and Collection
Account and shall not grant the right to take dominion and control or establish
"control" (within the meaning of Section 9-104 of the UCC of all applicable
jurisdictions) of any Lock-Box or Collection Account at a future time or upon
the occurrence of a future event to any Person, except to the Agent as
contemplated by this Agreement. With respect to any Lock-Box or Collection
Account, Seller shall take all steps necessary to ensure that the Agent has
"control" (within the meaning of Section 9-104 of the UCC of all applicable
jurisdictions) over such Lock-Box or Collection Account. So long as no
Amortization Event or Potential Amortization Event shall have occurred and be
continuing, the Servicer will be permitted to transfer proceeds from a Lock-Box
or Collection Account to another account of Servicer, provided that at all times
Servicer will hold such payments or, if applicable, will cause such payments to
be held in trust for the exclusive benefit of the Agent and the Purchasers
subject to application pursuant to Sections 2.2 and 2.3 hereof.
(k) Taxes. Such Seller Party will file all tax returns and
reports required by law to be filed by it and will promptly pay all taxes and
governmental charges at any time owing. Seller will pay when due any taxes
payable in connection with the Receivables, exclusive of taxes on or measured by
income or gross receipts of any Company, the Agent or any Financial Institution.
(l) Insurance. Seller will maintain in effect, or cause to be
maintained in effect, at Seller's own expense, such liability insurance as
Seller shall deem appropriate in its good faith business judgment. The Agent,
for the benefit of the Purchasers, shall be named as an additional insured with
respect to all such liability insurance maintained by Seller. Seller will pay or
cause to be paid, the premiums therefor and deliver to the Agent evidence
satisfactory to the Agent of such insurance
AMENDED AND RESTATED
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Page 25
coverage. Copies of each policy shall be furnished to the Agent and any
Purchaser in certificated form upon the Agent's or such Purchaser's request. The
foregoing requirements shall not be construed to negate, reduce or modify, and
are in addition to, Seller's obligations hereunder.
(m) Payment to Originator. With respect to any Receivable
purchased by Seller from Originator, such sale shall be effected under, and in
strict compliance with the terms of, the Receivables Sale Agreement, including,
without limitation, the terms relating to the amount and timing of payments to
be made to Originator in respect of the purchase price for such Receivable.
(n) Segregation of Other Servicer Collected Funds. Upon the
request of the Agent or Scotia and subject to the Servicer's ability to do so,
the Servicer shall, within six days of the date any Other Servicer Collected
Funds are deposited, credited or funded to any Collection Account, (i)
specifically identify all such Other Servicer Collected Funds and (ii) cause all
Other Servicer Collected Funds to be transferred from the applicable Collection
Account.
(o) Elimination of Other Servicer Collected Funds. Within 60
days of the date hereof, each Seller Party shall eliminate all Other Servicer
Collected Funds from, and prevent all Other Servicer Collected Funds from being
deposited, credited or otherwise funded to, any and all Collection Accounts.
Section 7.2 Negative Covenants of The Seller Parties. Until the date on
which the Aggregate Unpaids have been indefeasibly paid in full and this
Agreement terminates in accordance with its terms, each Seller Party hereby
covenants, as to itself (and not as to any other Seller Party), that:
(a) Name Change, Jurisdiction of Organization, Corporate
Structure, Offices and Records. Such Seller Party will not change its name,
identity, jurisdiction of organization or corporate structure (within the
meaning of Sections 9-503 and/or 9-507 of the UCC of all applicable
jurisdictions) or relocate its chief executive office, principal place of
business or any office where Records are kept unless it shall have: (i) given
the Agent at least forty-five (45) days' prior written notice thereof and (ii)
delivered to the Agent all financing statements, instruments and other documents
requested by the Agent in connection with such change or relocation.
(b) Change in Payment Instructions to Obligors. Except as may
be required by the Agent pursuant to Section 8.2(b), such Seller Party will not
add or terminate any bank as a Collection Bank, or make any change in the
instructions to Obligors regarding payments to be made to any Lock-Box or
Collection Account, unless the Agent shall have received, at least ten (10) days
before the proposed effective date therefor, (i) written notice of such
addition, termination or change and (ii) with respect to the addition of a
Collection Bank or a Collection Account or Lock-Box, an executed Collection
Account Agreement with respect to the new Collection Account or Lock-Box;
provided, however, that the Servicer may make changes in instructions to
Obligors
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regarding payments if such new instructions require such Obligors to make
payments to another existing Collection Account.
(c) Modifications to Contracts and Credit and Collection
Policy. Such Seller Party will not make any change to the Credit and Collection
Policy that could adversely affect the collectibility of the Receivables or
decrease the credit quality of any newly created Receivables. Except as provided
in Section 8.2(d), the Servicer will not extend, amend or otherwise modify the
terms of any Receivable or any Contract related thereto other than in accordance
with the Credit and Collection Policy.
(d) Sales, Liens. Seller will not sell, assign (by operation
of law or otherwise) or otherwise dispose of, or grant any option with respect
to, or create or suffer to exist any Adverse Claim upon (including, without
limitation, the filing of any financing statement) or with respect to, any
Receivable, Related Security or Collections, or upon or with respect to any
Contract under which any Receivable arises, or any Lock-Box or Collection
Account, or assign any right to receive income with respect thereto (other than,
in each case, the creation of the interests therein in favor of the Agent and
the Purchasers provided for herein), and Seller will defend the right, title and
interest of the Agent and the Purchasers in, to and under any of the foregoing
property, against all claims of third parties claiming through or under Seller
or Originator. Seller will not create or suffer to exist any mortgage, pledge,
security interest, encumbrance, lien, charge or other similar arrangement on any
of its inventory, the financing or lease of which gives rise to any Receivable.
(e) Net Receivables Balance. At no time after June 28, 2001
shall Seller permit the Net Receivables Balance to be less than an amount equal
to the sum of (i) the Aggregate Capital plus (ii) the Aggregate Reserves.
(f) Termination Date Determination. Seller will not designate
the Termination Date (as defined in the Receivables Sale Agreement), or send any
written notice to Originator in respect thereof, without the prior written
consent of the Agent, except with respect to the occurrence of such Termination
Date arising pursuant to Section 5.1(d) of the Receivables Sale Agreement.
(g) Restricted Junior Payments. From and after the occurrence
of any Amortization Event, Seller will not make any Restricted Junior Payment
if, after giving effect thereto, Seller would fail to meet its obligations set
forth in Section 7.2(e).
ARTICLE VIII
ADMINISTRATION AND COLLECTION
Section 8.1 Designation of Servicer. (a) The servicing,
administration and collection of the Receivables shall be conducted by such
Person (the "Servicer") so designated from time to time in accordance with this
Section 8.1. Avnet is hereby designated as, and hereby agrees to perform the
duties and obligations of, the Servicer pursuant to the terms of this Agreement.
The Agent (on behalf of the Purchasers) may, and at the direction of the
Required Purchasers shall, at any time after the occurrence of
AMENDED AND RESTATED
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Page 27
any Amortization Event, designate as Servicer any Person to succeed Avnet or any
successor Servicer.
(b) Without the prior written consent of the Agent and the
Required Purchasers, Avnet shall not be permitted to delegate any of its duties
or responsibilities as Servicer to any Person other than (i) Seller and (ii)
with respect to certain Charged-Off Receivables, outside collection agencies or
law firms, taking action in connection with collection activities, in accordance
with its customary practices. Seller shall not be permitted to further delegate
to any other Person any of the duties or responsibilities of the Servicer
delegated to it by Avnet. If at any time the Agent shall designate as Servicer
any Person other than Avnet, all duties and responsibilities theretofore
delegated by Avnet to Seller may, at the discretion of the Agent, be terminated
forthwith on notice given by the Agent to Avnet and to Seller.
(c) Notwithstanding the foregoing subsection (b), (i) Avnet
shall be and remain primarily liable to the Agent and the Purchasers for the
full and prompt performance of all duties and responsibilities of the Servicer
hereunder (unless a successor servicer has been designated by the Agent pursuant
to Section 8.1 hereof) and (ii) the Agent and the Purchasers shall be entitled
to deal exclusively with Avnet in matters relating to the discharge by the
Servicer of its duties and responsibilities hereunder. The Agent and the
Purchasers shall not be required to give notice, demand or other communication
to any Person other than Avnet in order for communication to the Servicer and
its sub-servicer or other delegate with respect thereto to be accomplished.
Avnet, at all times that it is the Servicer, shall be responsible for providing
any sub-servicer or other delegate of the Servicer with any notice given to the
Servicer under this Agreement.
Section 8.2 Duties of Servicer. (a) The Servicer shall take or cause
to be taken all such actions as may be necessary or advisable to collect each
Receivable from time to time, all in accordance with applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Credit and Collection Policy.
(b) The Servicer will instruct all Obligors to pay all
Collections directly to a Lock-Box or Collection Account. The Servicer shall
effect a Collection Account Agreement substantially in the form of Exhibit VI
with each bank party to a Collection Account at any time. In the case of any
remittances received in any Lock-Box or Collection Account that shall have been
identified, to the satisfaction of the Servicer, to not constitute Collections
or other proceeds of the Receivables or the Related Security, the Servicer shall
promptly remit such items to the Person identified to it as being the owner of
such remittances. From and after the date the Agent delivers to any Collection
Bank a Collection Notice pursuant to Section 8.3, the Agent may request that the
Servicer, and the Servicer thereupon promptly shall instruct all Obligors with
respect to the Receivables to, remit all payments thereon to a new depositary
account specified by the Agent and, at all times thereafter, Seller and the
Servicer shall not deposit or otherwise credit, and shall not permit any other
Person to deposit or otherwise credit to such new depositary account any cash or
payment item other than Collections. The Agent shall notify Scotia of such new
depositary account.
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(c) The Servicer shall administer the Collections in
accordance with the procedures described herein and in Article II. The Servicer
shall set aside and hold in trust for the account of Seller and the Purchasers
their respective shares of the Collections in accordance with Article II. The
Servicer shall, upon the request of the Agent, segregate, in a manner acceptable
to the Agent, all cash, checks and other instruments received by it from time to
time constituting Collections from the general funds of the Servicer or Seller
prior to the remittance thereof in accordance with Article II. If the Servicer
shall be required to segregate Collections pursuant to the preceding sentence,
the Servicer shall segregate and deposit with a bank designated by the Agent
such allocable share of Collections of Receivables set aside for the Purchasers
on the first Business Day following receipt by the Servicer of such Collections,
duly endorsed or with duly executed instruments of transfer.
(d) The Servicer may, in accordance with the Credit and
Collection Policy, extend the maturity of any Receivable or adjust the
Outstanding Balance of any Receivable as the Servicer determines to be
appropriate to maximize Collections thereof; provided, however, that such
extension or adjustment shall not alter the status of such Receivable as a
Delinquent Receivable or Charged-Off Receivable or limit the rights of the Agent
or the Purchasers under this Agreement. Notwithstanding anything to the contrary
contained herein, the Agent shall have the right, in its sole discretion, to
direct the Servicer to take all actions that a reasonable business person,
exercising prudent business judgment, would undertake to commence or settle any
legal action with respect to any Receivable or to foreclose upon or repossess
any Related Security.
(e) The Servicer shall hold in trust for Seller and the
Purchasers all Records that (i) evidence or relate to the Receivables, the
related Contracts and Related Security or (ii) are otherwise necessary or
desirable to collect the Receivables and shall, as soon as practicable upon
demand of the Agent, deliver or make available to the Agent all such Records, at
a place selected by the Agent. The Servicer shall, as soon as practicable
following receipt thereof turn over to Seller any cash collections or other cash
proceeds received with respect to Indebtedness owed to Seller not constituting
Receivables. The Servicer shall, from time to time at the request of any
Purchaser, furnish to the Purchasers (promptly after any such request) a
calculation of the amounts set aside for the Purchasers pursuant to Article II.
(f) Any payment by an Obligor in connection with any
Receivables in respect of any indebtedness owed by it to Originator or Seller
shall, except as otherwise specified by such Obligor or otherwise required by
contract or law and unless otherwise instructed by the Agent, be applied as a
Collection of any Receivable of such Obligor (starting with the oldest such
Receivable) to the extent of any amounts then due and payable thereunder before
being applied to any other receivable or other obligation of such Obligor.
Section 8.3 Collection Notices. The Agent is authorized at any time
after the occurrence of any Amortization Event to date and to deliver to the
Collection Banks the Collection Notices. The Agent agrees to notify the Seller
promptly after the
AMENDED AND RESTATED
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delivery of such Collection Notices to the Collection Banks. Seller hereby
transfers to the Agent for the benefit of the Purchasers, effective when the
Agent delivers such notice, the dominion and control and "control" (within the
meaning of Section 9-104 of the UCC of all applicable jurisdictions) of each
Lock-Box, each Collection Account and the amounts on deposit therein. In case
any authorized signatory of Seller whose signature appears on a Collection
Account Agreement shall cease to have such authority before the delivery of such
notice, such Collection Notice shall nevertheless be valid as if such authority
had remained in force. Seller hereby authorizes the Agent, and agrees that the
Agent shall be entitled to (i) endorse Seller's name on checks and other
instruments representing Collections, (ii) enforce the Receivables, the related
Contracts and the Related Security and (iii) take such action as shall be
necessary or desirable to cause all cash, checks and other instruments
constituting Collections of Receivables to come into the possession of the Agent
rather than Seller. The Agent agrees that after delivery of a Collection Notice,
the Collection Banks may continue to provide or otherwise make available to the
Seller and the Servicer copies of all correspondence or other mail which will be
sent directly to the Agent subsequent to the delivery of such Collection Notice
pursuant to the Collection Account Agreements.
Section 8.4 Responsibilities of Seller. Anything herein to the
contrary notwithstanding, the exercise by the Agent and the Purchasers of their
rights hereunder shall not release the Servicer, Originator or Seller from any
of their duties or obligations with respect to any Receivables or under the
related Contracts. The Purchasers shall have no obligation or liability with
respect to any Receivables or related Contracts, nor shall any of them be
obligated to perform the obligations of Seller.
Section 8.5 Reports. The Servicer shall prepare and forward to the
Agent and Scotia (i) on the fifteenth (15th) calendar day of each month (or if
such day is not a Business Day, the next Business Day) and at such times as the
Agent or the Required Purchasers shall request, a Monthly Report (which shall
include a work sheet calculating the Net Receivables Balance and the amount of
Eligible Receivables) and (ii) at such times as the Agent or the Required
Purchasers shall request, a listing by Obligor of all Receivables together with
an aging of such Receivables.
Section 8.6 Servicing Fees. In consideration of Avnet's agreement to
act as Servicer hereunder, the Purchasers hereby agree that, so long as Avnet
shall continue to perform as Servicer hereunder, Seller shall pay over to Avnet
a fee (the "Servicing Fee") on the first calendar day of each month, in arrears
for the immediately preceding month, equal to 1/12 of 1% per annum (in an
aggregate amount equal to 1% per annum) of the average Net Receivables Balance
during such period, as compensation for its servicing activities.
Section 8.7 Limited Recourse to Servicer. Purchasers shall have no
recourse to Servicer for any amounts due hereunder, other than those
specifically provided to be paid by Servicer hereunder and under the other
Transaction Documents, including, without limitation, for amounts payable
pursuant to Section 10.1(b) hereof.
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ARTICLE IX
AMORTIZATION EVENTS
Section 9.1 Amortization Events. The occurrence of any one or more
of the following events shall constitute an Amortization Event:
(a) Any Seller Party shall fail (i) to make any payment or
deposit required to be made by such Seller Party hereunder when due and, for any
such payment or deposit which is not in respect of Capital, such failure
continues for one (1) day, or (ii) to perform or observe any term, covenant or
agreement applicable to it hereunder (other than as referred to in clause (i) of
this paragraph (a) and Section 9.1(e)) or any other Transaction Document and
such failure shall continue for three (3) consecutive Business Days.
(b) Any representation, warranty, certification or statement
made by any Seller Party in this Agreement, any other Transaction Document or in
any other document delivered pursuant hereto or thereto shall prove to have been
incorrect when made or deemed made.
(c) Failure of Seller to pay any Indebtedness when due; or the
failure of Servicer to pay any Indebtedness in excess of $35 million,
individually or in the aggregate, when due; or the default by Servicer, or any
affiliate of Servicer which is a party thereto, in the performance of any term,
provision or condition contained in the Avnet 364-Day Credit Agreement or in the
Avnet Multi-Year Credit Agreement, the effect of which is to cause, or to permit
the holder or holders of such Indebtedness to cause, such Indebtedness to become
due prior to its stated maturity; or any Indebtedness of any Seller Party in
excess of $35 million (other than the Avnet 364-Day Credit Agreement and the
Avnet Multi-Year Credit Agreement) shall be caused to be declared due and
payable, or shall be declared to be due and payable or required to be prepaid
(other than by a regularly scheduled payment) prior to the date of maturity
thereof.
(d) (i) Any Seller Party or any of its Subsidiaries shall
generally not pay its debts as such debts become due or shall admit in writing
its inability to pay its debts generally or shall make a general assignment for
the benefit of creditors; or (ii) any proceeding shall be instituted by or
against any Seller Party or any of its Subsidiaries seeking to adjudicate it
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any substantial part of
its property or (iii) any Seller Party or any of its Subsidiaries shall take any
corporate action to authorize any of the actions set forth in clauses (i) or
(ii) above in this subsection (d).
(e) Seller shall fail to comply with the terms of Section 2.6
hereof.
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(f) As at the end of any calendar month, the three-month
rolling average of the Delinquency Ratio Trigger shall exceed 9.25%, or the
three-month rolling average of the Dilution Ratio Trigger shall exceed 8.25% or
the three-month rolling average of the Loss Ratio Trigger shall exceed 5.25%.
(g) A Change of Control shall occur.
(h) The senior unsecured long-term debt rating of Avnet shall
fall below BBB, as determined by Standard & Poor's Ratings Services, and shall
fall below Baa2, as determined by ▇▇▇▇▇'▇ Investors Service, Inc.
(i) (i) One or more final judgments for the payment of money
shall be entered against Seller or (ii) one or more final judgments for the
payment of money in an amount in excess of $50,000,000, individually or in the
aggregate, shall be entered against the Servicer on claims not covered by
insurance or as to which the insurance carrier has denied its responsibility,
and such judgment shall continue unsatisfied and in effect for thirty (30)
consecutive days without a stay of execution.
(j) The "Termination Date" under and as defined in the
Receivables Sale Agreement shall occur under the Receivables Sale Agreement or
Originator shall for any reason cease to transfer, or cease to have the legal
capacity to transfer, or otherwise be incapable of transferring Receivables to
Seller under the Receivables Sale Agreement.
(k) This Agreement shall terminate in whole or in part (except
in accordance with its terms), or shall cease to be effective or to be the
legally valid, binding and enforceable obligation of Seller, or any Obligor
shall directly or indirectly contest in any manner such effectiveness, validity,
binding nature or enforceability, or the Agent for the benefit of the Purchasers
shall cease to have a valid and perfected first priority security interest in
the Receivables, the Related Security and the Collections with respect thereto
and the Collection Accounts.
Section 9.2 Remedies. Upon the occurrence and during the
continuation of an Amortization Event, the Agent may, or upon the direction of
the Required Purchasers shall, take any of the following actions: (i) replace
the Person then acting as Servicer, (ii) with prior written notice to the
Servicer (except as provided in the following proviso), declare the Amortization
Date to have occurred, whereupon the Amortization Date shall forthwith occur;
provided, however, that upon the occurrence of an Amortization Event described
in Section 9.1(d)(ii), or of an actual or deemed entry of an order for relief
with respect to any Seller Party under the Federal Bankruptcy Code, the
Amortization Date shall automatically occur, without demand, protest or any
notice of any kind, all of which are hereby expressly waived by each Seller
Party, (iii) to the fullest extent permitted by applicable law, declare that the
Default Fee shall accrue with respect to any of the Aggregate Unpaids
outstanding at such time, (iv) deliver the Collection Notices to the Collection
Banks, and (v) notify Obligors of the Purchasers' interest in the Receivables.
The aforementioned rights and remedies shall be without limitation, and shall be
in addition to all other rights and remedies of the Agent and the Purchasers
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otherwise available under any other provision of this Agreement, by operation of
law, at equity or otherwise, all of which are hereby expressly preserved,
including, without limitation, all rights and remedies provided under the UCC
(or any comparable law), all of which rights shall be cumulative.
ARTICLE X
INDEMNIFICATION
Section 10.1 Indemnities by The Seller Parties. (a) Without limiting
any other rights that the Agent, any Purchaser, any Funding Source or any of
their respective Affiliates may have hereunder or under applicable law, Seller
hereby agrees to indemnify (and pay upon demand to) the Agent, each Funding
Source, each Purchaser and their respective Affiliates, assigns, officers,
directors, agents and employees (each an "Indemnified Party") from and against
any and all damages, losses, claims, taxes, liabilities, costs, expenses and for
all other amounts payable, including reasonable attorneys' fees (which attorneys
may be employees of the Agent or such Purchaser) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts") awarded
against or incurred by any of them arising out of or as a result of this
Agreement, or the use of the proceeds of any purchase hereunder, or the
acquisition, funding or ownership, either directly or indirectly, by a Purchaser
or a Funding Source of a Purchaser Interest or of an interest in the
Receivables, or any Receivable or any Contract or any Related Security, or any
action of any Seller Party or any Affiliate of any Seller Party, excluding,
however:
(i) Indemnified Amounts to the extent a final judgment
of a court of competent jurisdiction holds that such Indemnified Amounts
resulted from gross negligence or willful misconduct on the part of the
Indemnified Party seeking indemnification;
(ii) Indemnified Amounts to the extent the same includes
losses in respect of Receivables that are uncollectible on account of the
insolvency, bankruptcy or lack of creditworthiness of the related Obligor;
or
(iii) taxes imposed by the jurisdiction in which such
Indemnified Party's principal executive office is located, on or measured
by the overall net income of such Indemnified Party to the extent that the
computation of such taxes is consistent with the characterization for
income tax purposes of the acquisition by the Purchasers of Purchaser
Interests as a loan or loans by the Purchasers to Seller secured by the
Receivables, the Related Security, the Collection Accounts and the
Collections;
provided, however, that nothing contained in this sentence shall limit the
liability of Seller or limit the recourse of the Purchasers to Seller for
amounts otherwise specifically provided to be paid by Seller under the terms of
this Agreement. Without limiting the generality of the foregoing
indemnification, Seller shall indemnify each Indemnified
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Party for Indemnified Amounts (including, without limitation, losses in respect
of uncollectible receivables, regardless of whether reimbursement therefor would
constitute recourse to Seller or the Servicer) relating to or resulting from:
(iv) any representation or warranty made by any Seller
Party or Originator (or any officers of any such Person) under or in
connection with this Agreement, any other Transaction Document or any
other information or report delivered by any such Person pursuant hereto
or thereto, which shall have been false or incorrect when made or deemed
made;
(v) the failure by Seller, the Servicer or Originator to
comply with any applicable law, rule or regulation with respect to any
Receivable or Contract related thereto, or the nonconformity of any
Receivable or Contract included therein with any such applicable law, rule
or regulation or any failure of Originator to keep or perform any of its
obligations, express or implied, with respect to any Contract;
(vi) any failure of Seller, the Servicer or Originator
to perform its duties, covenants or other obligations in accordance with
the provisions of this Agreement or any other Transaction Document;
(vii) any products liability, personal injury or damage
suit, or other similar claim arising out of or in connection with
merchandise, insurance or services that are the subject of any Contract or
any Receivable;
(viii) any dispute, claim, offset or defense (other than
discharge in bankruptcy of the Obligor) of the Obligor to the payment of
any Receivable (including, without limitation, a defense based on such
Receivable or the related Contract not being a legal, valid and binding
obligation of such Obligor enforceable against it in accordance with its
terms), or any other claim resulting from the sale of the merchandise or
service related to such Receivable or the furnishing or failure to furnish
such merchandise or services;
(ix) the commingling of Collections of Receivables at
any time with other funds;
(x) any investigation, litigation or proceeding related
to or arising from this Agreement or any other Transaction Document, the
transactions contemplated hereby, the use of the proceeds of an
Incremental Purchase or a Reinvestment, the ownership of the Purchaser
Interests or any other investigation, litigation or proceeding relating to
Seller, the Servicer or Originator in which any Indemnified
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Party becomes involved as a result of any of the transactions contemplated
hereby;
(xi) any inability to litigate any claim against any
Obligor in respect of any Receivable as a result of such Obligor being
immune from civil and commercial law and suit on the grounds of
sovereignty or otherwise from any legal action, suit or proceeding;
(xii) any Amortization Event described in Section
9.1(d);
(xiii) any failure of Seller to acquire and maintain
legal and equitable title to, and ownership of any Receivable and the
Related Security and Collections with respect thereto from Originator,
free and clear of any Adverse Claim (other than as created hereunder); or
any failure of Seller to give reasonably equivalent value to Originator
under the Receivables Sale Agreement in consideration of the transfer by
Originator of any Receivable, or any attempt by any Person to void such
transfer under statutory provisions or common law or equitable action;
(xiv) any failure to vest and maintain vested in the
Agent for the benefit of the Purchasers, or to transfer to the Agent for
the benefit of the Purchasers, legal and equitable title to, and ownership
of, a first priority perfected undivided percentage ownership interest (to
the extent of the Purchaser Interests contemplated hereunder) or security
interest in the Receivables, the Related Security and the Collections,
free and clear of any Adverse Claim (except as created by the Transaction
Documents);
(xv) the failure to have filed, or any delay in filing,
financing statements or other similar instruments or documents under the
UCC (or any comparable law) of any applicable jurisdiction or other
applicable laws with respect to any Receivable, the Related Security and
Collections with respect thereto, and the proceeds of any thereof, whether
at the time of any Incremental Purchase or Reinvestment or at any
subsequent time;
(xvi) any action or omission by any Seller Party which
reduces or impairs the rights of the Agent or the Purchasers with respect
to any Receivable or the value of any such Receivable;
(xvii) any attempt by any Person to void any Incremental
Purchase or Reinvestment hereunder under statutory provisions or common
law or equitable action; and
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(xviii) the failure of any Receivable included in the
calculation of the Net Receivables Balance as an Eligible Receivable to be
an Eligible Receivable at the time so included.
(b) Without limiting any other rights that the Agent, any
Purchaser, any Funding Source or any of their respective Affiliates may have
hereunder or under applicable law, the Servicer hereby agrees to indemnify (and
pay upon demand to) each Indemnified Party for Indemnified Amounts awarded
against or incurred by any of them arising out of the Servicer's activities as
Servicer hereunder excluding, however:
(i) Indemnified Amounts to the extent a final judgment
of a court of competent jurisdiction holds that such Indemnified Amounts
resulted from gross negligence or willful misconduct on the part of the
Indemnified Party seeking indemnification;
(ii) Indemnified Amounts to the extent the same includes
losses in respect of Receivables that are uncollectible on account of the
insolvency, bankruptcy or lack of creditworthiness of the related Obligor;
or
(iii) taxes imposed by the jurisdiction in which such
Indemnified Party's principal executive office is located, on or measured
by the overall net income of such Indemnified Party to the extent that the
computation of such taxes is consistent with the characterization for
income tax purposes of the acquisition by the Purchasers of Purchaser
Interests as a loan or loans by the Purchasers to Seller secured by the
Receivables, the Related Security, the Collection Accounts and the
Collections;
provided, however, that nothing contained in this sentence shall limit the
liability of Servicer or limit the recourse of the Purchasers to Servicer for
amounts otherwise specifically provided to be paid by Servicer under the terms
of this Agreement.
Section 10.2 Increased Cost and Reduced Return.
If after June 28, 2001 with respect to any Funding Source relating
to the Bank One Company, or after the date hereof with respect to any other
Funding Source, any such Funding Source shall be charged any fee, expense or
increased cost on account of the adoption of any applicable law, rule or
regulation (including any applicable law, rule or regulation regarding capital
adequacy) or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
with any request or directive (whether or not having the force of law) of any
such authority, central bank or comparable agency (a "Regulatory Change"): (i)
that subjects any Funding Source to any charge or withholding on or with respect
to any Funding Agreement or a Funding Source's obligations under a Funding
Agreement, or on or with respect to the Receivables, or changes the basis of
taxation of payments to any
AMENDED AND RESTATED
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Funding Source of any amounts payable under any Funding Agreement (except for
changes in the rate of tax on the overall net income of a Funding Source or
taxes excluded by Section 10.1) or (ii) that imposes, modifies or deems
applicable any reserve, assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the account of a Funding
Source, or credit extended by a Funding Source pursuant to a Funding Agreement
or (iii) that imposes any other condition the result of which is to increase the
cost to a Funding Source of performing its obligations under a Funding
Agreement, or to reduce the rate of return on a Funding Source's capital as a
consequence of its obligations under a Funding Agreement, or to reduce the
amount of any sum received or receivable by a Funding Source under a Funding
Agreement or to require any payment calculated by reference to the amount of
interests or loans held or interest received by it, then, upon demand by the
Agent, Seller shall pay to the Agent, for the benefit of the relevant Funding
Source, such amounts charged to such Funding Source or such amounts to otherwise
compensate such Funding Source for such increased cost or such reduction.
Section 10.3 Other Costs and Expenses. Seller shall pay to the Agent
and each Purchaser on demand all costs and out-of-pocket expenses in connection
with the preparation, execution, delivery and administration of this Agreement,
the transactions contemplated hereby and the other documents to be delivered
hereunder, including without limitation, the cost of any Purchaser's auditors
auditing the books, records and procedures of Seller, reasonable fees and
out-of-pocket expenses of legal counsel for each Purchaser and the Agent (which
such counsel may be employees of any Purchaser or the Agent) with respect
thereto and with respect to advising any Purchaser and the Agent as to their
respective rights and remedies under this Agreement. Seller shall pay to the
Agent and each Purchaser on demand any and all costs and expenses of the Agent
and the Purchasers, if any, including reasonable counsel fees and expenses in
connection with the enforcement of this Agreement and the other documents
delivered hereunder and in connection with any restructuring or workout of this
Agreement or such documents, or the administration of this Agreement following
an Amortization Event. Seller shall reimburse each Company on demand for all
other costs and expenses incurred by such Company ("Other Costs"), including,
without limitation, the cost of auditing such Company's books by certified
public accountants, the cost of rating the Commercial Paper by independent
financial rating agencies, and the reasonable fees and out-of-pocket expenses of
counsel for such Company or any counsel for any shareholder of such Company with
respect to advising such Company or such shareholder as to matters relating to
such Company's operations.
Section 10.4 Allocations. Each Company shall allocate the liability
for Other Costs among Seller and other Persons with whom such Company has
entered into agreements to purchase interests in receivables ("Other Sellers").
If any Other Costs are attributable to Seller and not attributable to any Other
Seller, Seller shall be solely liable for such Other Costs. However, if Other
Costs are attributable to Other Sellers and not attributable to Seller, such
Other Sellers shall be solely liable for such Other Costs. All allocations to be
made pursuant to the foregoing provisions of this Article X shall be
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made by the applicable Company in its sole discretion and shall be binding on
Seller and the Servicer.
ARTICLE XI
THE AGENT
Section 11.1 Authorization and Action. Each Purchaser hereby
designates and appoints Bank One to act as its agent hereunder and under each
other Transaction Document, and authorizes the Agent to take such actions as
agent on its behalf and to exercise such powers as are delegated to the Agent by
the terms of this Agreement and the other Transaction Documents together with
such powers as are reasonably incidental thereto. The Agent shall not have any
duties or responsibilities, except those expressly set forth herein or in any
other Transaction Document, or any fiduciary relationship with any Purchaser,
and no implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of the Agent shall be read into this Agreement or any
other Transaction Document or otherwise exist for the Agent. In performing its
functions and duties hereunder and under the other Transaction Documents, the
Agent shall act solely as agent for the Purchasers and does not assume nor shall
be deemed to have assumed any obligation or relationship of trust or agency with
or for any Seller Party or any of such Seller Party's successors or assigns. The
Agent shall not be required to take any action that exposes the Agent to
personal liability or that is contrary to this Agreement, any other Transaction
Document or applicable law. The appointment and authority of the Agent hereunder
shall terminate upon the indefeasible payment in full of all Aggregate Unpaids.
Each Purchaser hereby authorizes the Agent to execute each of the Uniform
Commercial Code financing or continuation statements (and amendments thereto and
assignments or terminations thereof) on behalf of such Purchaser (the terms of
which shall be binding on such Purchaser).
Section 11.2 Delegation of Duties. The Agent may execute any of its
duties under this Agreement and each other Transaction Document by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agents or attorneys-in-fact
selected by it with reasonable care.
Section 11.3 Exculpatory Provisions. Neither the Agent nor any of
its directors, officers, agents or employees shall be (i) liable for any action
lawfully taken or omitted to be taken by it or them under or in connection with
this Agreement or any other Transaction Document (except for its, their or such
Person's own gross negligence or willful misconduct), or (ii) responsible in any
manner to any of the Purchasers for any recitals, statements, representations or
warranties made by any Seller Party contained in this Agreement, any other
Transaction Document or any certificate, report, statement or other document
referred to or provided for in, or received under or in connection with, this
Agreement, or any other Transaction Document or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement, or
any other Transaction Document or any other document furnished in connection
herewith or therewith, or for any failure of any Seller Party to perform its
obligations hereunder or thereunder, or for the satisfaction of any condition
specified in Article VI, or for the
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perfection, priority, condition, value or sufficiency of any collateral pledged
in connection herewith. The Agent shall not be under any obligation to any
Purchaser to ascertain or to inquire as to the observance or performance of any
of the agreements or covenants contained in, or conditions of, this Agreement or
any other Transaction Document, or to inspect the properties, books or records
of the Seller Parties. The Agent shall not be deemed to have knowledge of any
Amortization Event or Potential Amortization Event unless the Agent has received
notice from Seller or a Purchaser.
Section 11.4 Reliance by Agent. The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to Seller), independent
accountants and other experts selected by the Agent. The Agent shall in all
cases be fully justified in failing or refusing to take any action under this
Agreement or any other Transaction Document unless it shall first receive such
advice or concurrence of the Required Purchasers or all of the Purchasers, as
applicable, as it deems appropriate and it shall first be indemnified to its
satisfaction by the Purchasers, provided that unless and until the Agent shall
have received such advice, the Agent may take or refrain from taking any action,
as the Agent shall deem advisable and in the best interests of the Purchasers.
The Agent shall in all cases be fully protected in acting, or in refraining from
acting, in accordance with a request of the Required Purchasers or all of the
Purchasers, as applicable, and such request and any action taken or failure to
act pursuant thereto shall be binding upon all the Purchasers.
Section 11.5 Non-Reliance on Agent and Other Purchasers. Each
Purchaser expressly acknowledges that neither the Agent, nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates has made
any representations or warranties to it and that no act by the Agent hereafter
taken, including, without limitation, any review of the affairs of any Seller
Party, shall be deemed to constitute any representation or warranty by the
Agent. Each Purchaser represents and warrants to the Agent that it has and will,
independently and without reliance upon the Agent or any other Purchaser and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of Seller and
made its own decision to enter into this Agreement, the other Transaction
Documents and all other documents related hereto or thereto.
Section 11.6 Reimbursement and Indemnification. Each Financial
Institution agrees to reimburse and indemnify the Agent and its officers,
directors, employees, representatives and agents ratably based on the ratio of
each such indemnifying Financial Institution's Commitment to the aggregate
Commitment, to the extent not paid or reimbursed by the Seller Parties (i) for
any amounts for which the Agent, acting in its capacity as Agent, is entitled to
reimbursement by the Seller Parties hereunder and (ii) for any other expenses
incurred by the Agent, in its capacity as Agent and acting on behalf of the
Purchasers, in connection with the administration and enforcement of this
Agreement and the other Transaction Documents.
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Section 11.7 Agent in its Individual Capacity. The Agent and its
Affiliates may make loans to, accept deposits from and generally engage in any
kind of business with Seller or any Affiliate of Seller as though the Agent were
not the Agent hereunder. With respect to the acquisition of Purchaser Interests
pursuant to this Agreement, the Agent shall have the same rights and powers
under this Agreement in its individual capacity as any Purchaser and may
exercise the same as though it were not the Agent, and the terms "Financial
Institution," "Purchaser," "Related Financial Institution," "Financial
Institutions," "Purchasers," and "Related Financial Institutions," shall include
the Agent in its individual capacity.
Section 11.8 Successor Agent. The Agent may, upon five days' notice
to Seller and the Purchasers, and the Agent will, upon the direction of all of
the Purchasers (other than the Agent, in its individual capacity), resign as
Agent. If the Agent shall resign, then the Required Purchasers during such
five-day period shall appoint from among the Purchasers a successor agent. If
for any reason no successor Agent is appointed by the Required Purchasers during
such five-day period, then effective upon the termination of such five-day
period, the Purchasers shall perform all of the duties of the Agent hereunder
and under the other Transaction Documents and Seller and the Servicer (as
applicable) shall make all payments in respect of the Aggregate Unpaids directly
to the applicable Purchasers and for all purposes shall deal directly with the
Purchasers. After the effectiveness of any retiring Agent's resignation
hereunder as Agent, the retiring Agent shall be discharged from its duties and
obligations hereunder and under the other Transaction Documents and the
provisions of this Article XI and Article X shall continue in effect for its
benefit with respect to any actions taken or omitted to be taken by it while it
was Agent under this Agreement and under the other Transaction Documents.
ARTICLE XII
ASSIGNMENTS; PARTICIPATIONS
Section 12.1 Assignments. (a) Seller, the Servicer, the Agent and
each Purchaser hereby agree and consent to the complete or partial assignment by
any Company of all or any portion of its rights under, interest in, title to and
obligations under this Agreement to any Funding Source pursuant to any Funding
Agreement or to any other Person, and upon such assignment, such Company shall
be released from its obligations so assigned. Further, Seller, the Servicer, the
Agent and each Purchaser hereby agree that any assignee of any Company of this
Agreement or of all or any of the Purchaser Interests of any Company shall have
all of the rights and benefits under this Agreement as if the term "Company"
explicitly referred to and included such party (provided that (i) the Purchaser
Interests of any such assignee that is a Company or a commercial paper conduit
shall accrue CP Costs based on such Company's Company Costs or on such
commercial paper conduit's cost of funds, respectively, and (ii) the Purchaser
Interests of any other such assignee shall accrue Yield pursuant to Section
4.1), and no such assignment shall in any way impair the rights and benefits of
any Company hereunder. Neither Seller nor the Servicer shall have the right to
assign its rights or obligations under this Agreement.
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(b) Any Financial Institution may at any time and from time to
time assign to one or more Persons ("Purchasing Financial Institutions") all or
any part of its rights and obligations under this Agreement pursuant to an
assignment agreement, substantially in the form set forth in Exhibit VII hereto
(the "Assignment Agreement") executed by such Purchasing Financial Institution
and such selling Financial Institution. The consent of the Company in such
selling Financial Institution's Purchaser Group shall be required prior to the
effectiveness of any such assignment. Each assignee of a Financial Institution
must (i) have a short-term debt rating of A-1 or better by Standard & Poor's
Ratings Services and P-1 by ▇▇▇▇▇'▇ Investors Service, Inc. and (ii) agree to
deliver to the Agent, promptly following any request therefor by the Agent or
the Company in such selling Financial Institution's Purchaser Group, an
enforceability opinion in form and substance satisfactory to the Agent and such
Company. Upon delivery of the executed Assignment Agreement to the Agent, such
selling Financial Institution shall be released from its obligations hereunder
to the extent of such assignment. Thereafter the Purchasing Financial
Institution shall for all purposes be a Financial Institution party to this
Agreement and shall have all the rights and obligations of a Financial
Institution (including, without limitation, the applicable obligations of a
Related Financial Institution) under this Agreement to the same extent as if it
were an original party hereto and no further consent or action by Seller, the
Purchasers or the Agent shall be required.
(c) Each of the Financial Institutions agrees that in the
event that it shall cease to have a short-term debt rating of A-1 or better by
Standard & Poor's Ratings Services and P-1 by ▇▇▇▇▇'▇ Investors Service, Inc.
(an "Affected Financial Institution"), such Affected Financial Institution shall
be obliged, at the request of the Company in such Affected Financial
Institution's Purchaser Group or the Agent, to assign all of its rights and
obligations hereunder to (x) another Financial Institution in such Affected
Financial Institution's Purchaser Group or (y) another funding entity nominated
by the Agent or Scotia and acceptable to the Company in such Affected Financial
Institution's Purchaser Group, and willing to participate in this Agreement
through the Liquidity Termination Date in the place of such Affected Financial
Institution; provided that the Affected Financial Institution receives payment
in full, pursuant to an Assignment Agreement, of an amount equal to such
Financial Institution's Pro Rata Share of the Aggregate Capital and Yield owing
to the Financial Institutions in such Affected Financial Institution's Purchaser
Group and all accrued but unpaid fees and other costs and expenses payable in
respect of its Pro Rata Share of the Purchaser Interests of the Financial
Institutions in such Affected Financial Institution's Purchaser Group.
Section 12.2 Participations. Any Financial Institution may, in the
ordinary course of its business at any time sell to one or more Persons (each a
"Participant") participating interests in its Pro Rata Share of the Purchaser
Interests of the Financial Institutions in such Financial Institution's
Purchaser Group or any other interest of such Financial Institution hereunder.
Notwithstanding any such sale by a Financial Institution of a participating
interest to a Participant, such Financial Institution's rights and obligations
under this Agreement shall remain unchanged, such Financial Institution shall
remain solely responsible for the performance of its obligations hereunder, and
AMENDED AND RESTATED
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Page 41
Seller, each Company and the Agent shall continue to deal solely and directly
with such Financial Institution in connection with such Financial Institution's
rights and obligations under this Agreement. Each Financial Institution agrees
that any agreement between such Financial Institution and any such Participant
in respect of such participating interest shall not restrict such Financial
Institution's right to agree to any amendment, supplement, waiver or
modification to this Agreement, except for any amendment, supplement, waiver or
modification described in Section 13.1(b)(i).
ARTICLE XIII
MISCELLANEOUS
Section 13.1 Waivers and Amendments. (a) No failure or delay on the
part of the Agent or any Purchaser in exercising any power, right or remedy
under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or remedy preclude any other further
exercise thereof or the exercise of any other power, right or remedy. The rights
and remedies herein provided shall be cumulative and nonexclusive of any rights
or remedies provided by law. Any waiver of this Agreement shall be effective
only in the specific instance and for the specific purpose for which given.
(b) No provision of this Agreement may be amended,
supplemented, modified or waived except in writing in accordance with the
provisions of this Section 13.1(b). Each Company, Seller and the Agent, at the
direction of the Required Purchasers, may enter into written modifications or
waivers of any provisions of this Agreement, provided, however, that no such
modification or waiver shall:
(i) without the consent of each affected Purchaser, (A)
extend the Liquidity Termination Date or the date of any payment or
deposit of Collections by Seller or the Servicer, (B) reduce the rate or
extend the time of payment of Yield or any CP Costs (or any component of
Yield or CP Costs), (C) reduce any fee payable to the Agent for the
benefit of the Purchasers, (D) except pursuant to Article XII hereof,
change the amount of the Capital of any Purchaser, any Financial
Institution's Pro Rata Share, any Company's Pro Rata Share, any Financial
Institution's Commitment or any Company's Company Purchase Limit (other
than, to the extent applicable, pursuant to Section 4.6 or the terms of
any Funding Agreement), (E) amend, modify or waive any provision of the
definition of Required Purchasers or this Section 13.1(b) or Section 4.6
or Section 13.6, (F) consent to or permit the assignment or transfer by
Seller of any of its rights and obligations under this Agreement, or (G)
amend or modify any defined term (or any defined term used directly or
indirectly in such defined term) used in clauses (A) through (F) above in
a manner that would circumvent the intention of the restrictions set forth
in such clauses;
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(ii) without the written consent of the then Agent,
amend, modify or waive any provision of this Agreement if the effect
thereof is to affect the rights or duties of such Agent; or
(iii) without the written consent of the Agent and each
Purchaser (A) amend, modify or waive any Potential Amortization Event or
Amortization Event; (B) change the definition of "Aggregate Reserves,"
"Concentration Limits," "Default Ratio," "Delinquency Ratio Trigger,"
"Dilution Horizon Factor," "Dilution Reserve," "Dilution Ratio," "Dilution
Percentage," "Dilution Ratio Trigger," "Eligible Receivable," "Loss
Horizon Factor," "Loss Reserve," "Loss Percentage,""Loss Ratio Trigger,"
and "Servicing and Yield Reserve,"; (C) amend, modify or waive any
provision in Article IX; or (D) amend or modify any defined term (or any
defined term used directly or indirectly in such defined term) used in
clauses (A) through (C) above in a manner that would circumvent the
intention of the restrictions set forth in such clauses.
Notwithstanding the foregoing, (i) without the consent of the Financial
Institutions, but with the consent of Seller, the Agent may amend this Agreement
solely to add additional Persons as Financial Institutions hereunder and (ii)
the Agent, the Required Purchasers and each Company may enter into amendments to
modify any of the terms or provisions of Article XI, Section 13.13 or any other
provision of this Agreement without the consent of Seller, provided that such
amendment has no negative impact upon Seller. Any modification or waiver made in
accordance with this Section 13.1 shall apply to each of the Purchasers equally
and shall be binding upon Seller, the Purchasers and the Agent.
Section 13.2 Notices. Except as provided in this Section 13.2, all
communications and notices provided for hereunder shall be in writing (including
bank wire, telecopy or electronic facsimile transmission or similar writing) and
shall be given to the other parties hereto at their respective addresses or
telecopy numbers set forth on the signature pages hereof or at such other
address or telecopy number as such Person may hereafter specify for the purpose
of notice to each of the other parties hereto. Each such notice or other
communication shall be effective (i) if given by telecopy, upon the receipt
thereof, (ii) if given by mail, three (3) Business Days after the time such
communication is deposited in the mail with first class postage prepaid or (iii)
if given by any other means, when received at the address specified in this
Section 13.2. Seller hereby authorizes the Agent and the Purchasers to effect
purchases and selections of Tranche Periods and Discount Rates based on
telephonic notices made by any Person whom the Agent or applicable Purchaser in
good faith believes to be acting on behalf of Seller. Seller agrees to deliver
promptly to the Agent and each applicable Purchaser a written confirmation of
each telephonic notice signed by an authorized officer of Seller; provided,
however, the absence of such confirmation shall not affect the validity of such
notice. If the written confirmation differs from the action taken by the Agent
or applicable Purchaser, the records of the Agent or applicable Purchaser shall
govern absent manifest error.
AMENDED AND RESTATED
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Section 13.3 Ratable Payments. If any Purchaser, whether by setoff
or otherwise, has payment made to it with respect to any portion of the
Aggregate Unpaids owing to such Purchaser (other than payments received pursuant
to Section 10.2 or 10.3) in a greater proportion than that received by any other
Purchaser entitled to receive a ratable share of such Aggregate Unpaids, such
Purchaser agrees, promptly upon demand, to purchase for cash without recourse or
warranty a portion of such Aggregate Unpaids held by the other Purchasers so
that after such purchase each Purchaser will hold its ratable proportion of such
Aggregate Unpaids; provided that if all or any portion of such excess amount is
thereafter recovered from such Purchaser, such purchase shall be rescinded and
the purchase price restored to the extent of such recovery, but without
interest.
Section 13.4 Protection of Ownership Interests of the Purchasers.
(a) Seller agrees that from time to time, at its expense, it will promptly
execute and deliver all instruments and documents, and take all actions, that
may be necessary or desirable, or that the Agent may request, to perfect,
protect or more fully evidence the Purchaser Interests, or to enable the Agent
or the Purchasers to exercise and enforce their rights and remedies hereunder.
Without limiting the foregoing, Seller will, upon the request of the Agent, file
such financing or continuation statements, or amendments thereto or assignments
thereof, and execute and file such other instruments and documents, that may be
necessary or desirable, or that the Agent may reasonably request, to perfect,
protect or evidence such Purchaser Interest. At any time after an Amortization
Event or Potential Amortization Event shall have occurred and be continuing, the
Agent may, or the Agent may direct Seller or the Servicer to, notify the Obligor
of Receivables, at Seller's expense, of the ownership or security interests of
the Purchasers under this Agreement and may also direct that payments of all
amounts due or that become due under any or all Receivables be made directly to
the Agent or its designee. Seller or the Servicer (as applicable) shall, at any
Purchaser's request, withhold the identity of such Purchaser in any such
notification.
(b) If any Seller Party fails to perform any of its
obligations hereunder, the Agent or any Purchaser may (but shall not be required
to) perform, or cause performance of, such obligations, and the Agent's or such
Purchaser's costs and expenses incurred in connection therewith shall be payable
by Seller as provided in Section 10.3. Each Seller Party irrevocably authorizes
the Agent at any time and from time to time after the occurrence of any
Amortization Event in the sole discretion of the Agent, and appoints the Agent
as its attorney-in-fact, to act on behalf of such Seller Party (i) to authorize
on behalf of such Seller Party as debtor and to file financing or continuation
statements (and amendments thereto and assignments thereof) necessary or
desirable in the Agent's sole discretion to perfect and to maintain the
perfection and priority of the interest of the Purchasers in the Receivables and
(ii) to file a carbon, photographic or other reproduction of this Agreement or
any financing statement with respect to the Receivables as a financing statement
in such offices as the Agent in its sole discretion deems necessary or desirable
to perfect and to maintain the perfection and priority of the interests of the
Purchasers in the Receivables. This appointment is coupled with an interest and
is irrevocable. The authorization by each Seller Party set forth in the
AMENDED AND RESTATED
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Page 44
second sentence of this Section 13.4(b) is intended to meet all requirements for
authorization by a debtor under Article 9 of any applicable enactment of the
UCC, including, without limitation, Section 9-509 thereof.
Section 13.5 Confidentiality. (a) Each Seller Party and each
Purchaser shall maintain and shall cause each of its employees and officers to
maintain the confidentiality of this Agreement, except as required by law, and
the other confidential or proprietary information with respect to the Agent and
each Purchaser and their respective businesses obtained by it or them in
connection with the structuring, negotiating and execution of the transactions
contemplated herein, except that such Seller Party and such Purchaser and its
officers and employees may disclose such information to such Seller Party's and
such Purchaser's external accountants and attorneys and as required by any law,
rule, regulation, direction, request or order of any judicial, administrative or
regulatory authority or proceedings (whether or not having the force or effect
of law), including disclosure in the financial statements of each of the Seller
Parties of the existence and financial effects of the transactions contemplated
by this Agreement.
(a) Anything herein to the contrary notwithstanding, each
Seller Party hereby consents to the disclosure of any nonpublic information with
respect to it (i) to the Agent, the Financial Institutions or the Companies by
each other, (ii) by the Agent or the Purchasers to any prospective or actual
assignee or participant of any of them and (iii) by the Agent or any Purchaser
to any rating agency, Funding Source, Commercial Paper dealer or provider of a
surety, guaranty or credit or liquidity enhancement to any Company or any entity
organized for the purpose of purchasing, or making loans secured by, financial
assets for which Bank One or Scotia acts as the administrative agent and to any
officers, directors, employees, outside accountants and attorneys of any of the
foregoing. In addition, the Purchasers and the Agent may disclose any such
nonpublic information pursuant to any law, rule, regulation, direction, request
or order of any judicial, administrative or regulatory authority or proceedings
(whether or not having the force or effect of law). Except as provided in this
clause (b) above, the Agent, Bank One, NA (Main Office Chicago), as a Purchaser,
and the other Purchasers shall maintain and shall cause each of its employees
and officers to maintain the confidentiality of any confidential or proprietary
information with respect to the Seller Parties obtained by it or them in
connection with the structuring, negotiating and execution of the transactions
contemplated herein.
Section 13.6 Bankruptcy Petition. Seller, the Servicer, the Agent
and each Purchaser hereby covenants and agrees that, prior to the date that is
one year and one day after the payment in full of all outstanding senior
indebtedness of any Company or any Funding Source that is a special purpose
bankruptcy remote entity, it will not institute against, or join any other
Person in instituting against, any Company or any such entity any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceeding under the laws of the United States or any state of the
United States.
Section 13.7 Limitation of Liability. Except with respect to any
claim arising out of the willful misconduct or gross negligence of any Company,
the Agent or any Financial Institution, no claim may be made by any Seller Party
or any other Person against any Company, the Agent or
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Page 45
any Financial Institution or their respective Affiliates, directors, officers,
employees, attorneys or agents for any special, indirect, consequential or
punitive damages in respect of any claim for breach of contract or any other
theory of liability arising out of or related to the transactions contemplated
by this Agreement, or any act, omission or event occurring in connection
therewith; and each Seller Party hereby waives, releases, and agrees not to ▇▇▇
upon any claim for any such damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
Section 13.8 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK EXCLUDING
CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE
APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.
Section 13.9 CONSENT TO JURISDICTION. EACH SELLER PARTY HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR NEW YORK STATE COURT SITTING IN NEW YORK COUNTY, NEW YORK IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
DOCUMENT EXECUTED BY SUCH PERSON PURSUANT TO THIS AGREEMENT AND EACH SELLER
PARTY HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES
ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN
INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY
PURCHASER TO BRING PROCEEDINGS AGAINST ANY SELLER PARTY IN THE COURTS OF ANY
OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY SELLER PARTY AGAINST THE
AGENT OR ANY PURCHASER OR ANY AFFILIATE OF THE AGENT OR ANY PURCHASER INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY SUCH SELLER PARTY
PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A COURT IN NEW YORK COUNTY,
NEW YORK.
Section 13.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT
OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY ANY
SELLER PARTY PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED
HEREUNDER OR THEREUNDER.
Section 13.11 Integration; Binding Effect; Survival of Terms.
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RECEIVABLES PURCHASE AGREEMENT
Page 46
(a) This Agreement and each other Transaction Document contain
the final and complete integration of all prior expressions by the parties
hereto with respect to the subject matter hereof and shall constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
superseding all prior oral or written understandings.
(b) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns (including any trustee in bankruptcy). This Agreement shall create and
constitute the continuing obligations of the parties hereto in accordance with
its terms and shall remain in full force and effect until terminated in
accordance with its terms; provided, however, that the rights and remedies with
respect to (i) any breach of any representation and warranty made by any Seller
Party pursuant to Article V, (ii) the indemnification and payment provisions of
Article X, and Sections 13.5 and 13.6 shall be continuing and shall survive any
termination of this Agreement.
Section 13.12 Counterparts; Severability; Section References. This
Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which when taken together shall constitute one and
the same Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Unless otherwise expressly indicated, all references herein
to "Article," "Section," "Schedule" or "Exhibit" shall mean articles and
sections of, and schedules and exhibits to, this Agreement.
Section 13.13 Bank One Roles. Each of the Purchasers acknowledges
that Bank One acts, or may in the future act, (i) as administrative agent for
the Bank One Company or any Financial Institution in the Bank One Company's
Purchaser Group, (ii) as issuing and paying agent for certain Commercial Paper,
(iii) to provide credit or liquidity enhancement for the timely payment for
certain Commercial Paper and (iv) to provide other services from time to time
for the Bank One Company or any Financial Institution in the Bank One Company's
Purchaser Group (collectively, the "Bank One Roles"). Without limiting the
generality of this Section 13.13, each Purchaser hereby acknowledges and
consents to any and all Bank One Roles and agrees that in connection with any
Bank One Role, Bank One may take, or refrain from taking, any action that it, in
its discretion, deems appropriate, including, without limitation, in its role as
administrative agent for the Bank One Company.
Section 13.14 Characterization. (a) It is the intention of the
parties hereto that each purchase hereunder shall constitute and be treated as
an absolute and irrevocable sale, which purchase shall provide the applicable
Purchaser with the full benefits of ownership of the applicable Purchaser
Interest. Except as specifically provided in this Agreement, each sale of a
Purchaser Interest hereunder is made without recourse to Seller; provided,
however, that (i) Seller shall be liable to each Purchaser and
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Page 47
the Agent for all representations, warranties, covenants and indemnities made by
Seller pursuant to the terms of this Agreement, and (ii) such sale does not
constitute and is not intended to result in an assumption by any Purchaser or
the Agent or any assignee thereof of any obligation of Seller or Originator or
any other Person arising in connection with the Receivables, the Related
Security, or the related Contracts, or any other obligations of Seller or
Originator.
(b) In addition to any ownership interest which the Agent may
from time to time acquire pursuant hereto, Seller hereby grants to the Agent for
the ratable benefit of the Purchasers a valid and perfected security interest in
all of Seller's right, title and interest in, to and under all Receivables now
existing or hereafter arising, the Collections, each Lock-Box, each Collection
Account, all Related Security, all other rights and payments relating to such
Receivables, and all proceeds of any thereof prior to all other liens on and
security interests therein to secure the prompt and complete payment of the
Aggregate Unpaids. The Agent and the Purchasers shall have, in addition to the
rights and remedies that they may have under this Agreement, all other rights
and remedies provided to a secured creditor under the UCC (or any comparable
law) and other applicable law, which rights and remedies shall be cumulative.
Section 13.15 Assignment of Bank One Company's and Bank One's
Interests under the Original Agreement. In furtherance of, and without limiting
any other provision of, this Agreement and the transactions contemplated hereby,
the parties hereto hereby effect the following assignments and assumptions:
(a) Assignment to the Scotia Company. At or before 12:00 noon
(Chicago time) on the date hereof the Scotia Company shall pay to the Bank One
Company, in immediately available funds, an amount equal to $112,482,509,
representing 33.3333333% of the outstanding Capital of the Bank One Company's
Purchaser Interests (such amount, being hereinafter referred to as the "Scotia
Capital"); whereupon, the Bank One Company shall be deemed to have sold,
transferred and assigned to the Scotia Company, without recourse, representation
or warranty, and the Scotia Company shall be deemed to have hereby irrevocably
taken, received and assumed from the Bank One Company, the Scotia Capital and
all related rights and obligations hereunder, under the Original Agreement and
under the other Transaction Documents.
(b) Assignment to Scotia. On the date hereof, Bank One shall
be deemed to have hereby transferred and assigned to Scotia, without recourse,
representation or warranty, and Scotia shall be deemed to have hereby
irrevocably taken, received and assumed from Bank One, 14.28571% of Bank One's
Commitment under the Original Agreement representing $51,000,000 and all rights
and obligations associated therewith (including, without limitation, the rights
and obligations of a Financial Institution) under the terms hereof and of the
Original Agreement, including, without limitation, Bank One's future funding
obligations under Article I of the Original Agreement; provided that Scotia
shall be the Scotia Company's Related Financial Institution and not the Bank One
Company's Related Financial Institution; and provided, further, that following
such assignment the Commitment of Scotia and the Commitment of Bank One shall be
in the applicable amount set forth on Schedule A.
AMENDED AND RESTATED
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Section 13.16 Confirmation and Ratification of Terms.
(a) Upon the effectiveness of this Agreement, each reference
to the Original Agreement in any other Transaction Document, and any document,
instrument or agreement executed and/or delivered in connection with the
Original Agreement or any other Transaction Document, shall mean and be a
reference to this Agreement.
(b) The other Transaction Documents and all agreements,
instruments and documents executed or delivered in connection with the Original
Agreement or any other Transaction Document shall each be deemed to be amended
to the extent necessary, if any, to give effect to the provisions of this
Agreement, as the same may be amended, modified, supplemented or restated from
time to time.
(c) The effect of this Agreement is to amend and restate the
Original Agreement in its entirety, and to the extent that any rights, benefits
or provisions in favor of the Agent or any Purchaser existed in the Original
Agreement and continue to exist in this Agreement without any written waiver of
any such rights, benefits or provisions prior to the date hereof, then such
rights, benefits or provisions are acknowledged to be and to continue to be
effective from and after June 28, 2001. This Agreement is not a novation.
(d) The parties hereto agree and acknowledge that any and all
rights, remedies and payment provisions under the Original Agreement, including,
without limitation, any and all rights, remedies and payment provisions with
respect to (i) any representation and warranty made or deemed to be made
pursuant to the Original Agreement, or (ii) any indemnification provision, shall
continue and survive the execution and delivery of this Agreement.
(e) The parties hereto agree and acknowledge that any and all
amounts owing as or for Capital, Yield, CP Costs, fees, expenses or otherwise
under or pursuant to the Original Agreement, immediately prior to the
effectiveness of this Agreement shall be owing as or for Capital, Yield, CP
Costs, fees, expenses or otherwise, respectively, under or pursuant to this
Agreement.
(SIGNATURE PAGES FOLLOW)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date
hereof.
AVNET RECEIVABLES CORPORATION, as Seller
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President and Secretary
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
AVNET, INC., as Servicer
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Senior Vice President and Chief Financial
Officer
Address: ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
PREFERRED RECEIVABLES FUNDING CORPORATION, as a
Company
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Authorized Signatory
Address: c/o Bank One, NA (Main Office Chicago),
as agent
Asset Backed Finance
Suite IL1-0079, 1-19
1 Bank ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
BANK ONE, NA (MAIN OFFICE CHICAGO), as a Financial
Institution and as Agent
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Authorized Signatory
Address: Bank One, NA (Main Office Chicago)
Asset Backed Finance
Suite IL1-0596, 1-21
1 Bank ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
LIBERTY STREET FUNDING CORP., as a Company
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
Address: c/o Global Securitization Services, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
THE BANK OF NOVA SCOTIA, as a Financial Institution
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Director
Address: The Bank of Nova Scotia
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
EXHIBIT I
DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):
"Accrual Period" means each calendar month, provided that the initial
Accrual Period hereunder with respect to the Scotia Company means the period
from (and including) the date hereof to (and including) February 28, 2002.
"Adverse Claim" means a lien, security interest, charge or encumbrance,
or other right or claim in, of or on any Person's assets or properties in favor
of any other Person.
"Affected Financial Institution" has the meaning specified in Section
12.1(c).
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person or any Subsidiary of such Person. A Person
shall be deemed to control another Person if the controlling Person owns 20% or
more of any class of voting securities of the controlled Person or possesses,
directly or indirectly, the power to direct or cause the direction of the
management or policies of the controlled Person, whether through ownership of
stock, by contract or otherwise.
"Agent" has the meaning set forth in the preamble to this Agreement.
"Aggregate Capital" means, on any date of determination, the aggregate
amount of Capital of all Purchaser Interests outstanding on such date.
"Aggregate Reduction" has the meaning specified in Section 1.3.
"Aggregate Reserves" means, on any date of determination, the sum of
the Loss Reserve, the Dilution Reserve and the Servicing and Yield Reserve.
"Aggregate Unpaids" means, at any time, an amount equal to the sum of
all, Aggregate Capital and all other unpaid Obligations (whether due or accrued)
at such time.
"Agreement" means this Amended and Restated Receivables Purchase
Agreement, as it may be amended or modified and in effect from time to time.
"Amortization Date" means the earliest to occur of (i) the Business Day
immediately prior to the occurrence of an Amortization Event set forth in
Section 9.1(d)(ii), (ii) the Business Day specified in a written notice from the
Agent following the occurrence of any other Amortization Event, (iii) the date
which is thirty (30) Business Days after the Agent's receipt of written notice
from Seller that it wishes to
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-1
terminate the facility evidenced by this Agreement and (iv) the Facility
Termination Date.
"Amortization Event" has the meaning specified in Article IX.
"Applicable Margin" means on any date the applicable spread set forth
below based upon the ratings of Avnet, Inc. applicable on such date to any
Long-Term Debt then outstanding:
Applicable Margin
-----------------
Category 1
A or higher by S&P or A2
or higher by Moody's 0.250%
Category 2
A- or higher by S&P or A3
or higher by Moody's (and
not Category 1) 0.375%
Category 3
BBB+ or higher by S&P
or Baa1 or higher by
Moody's (and not Category 2) 0.475%
Category 4
BBB or higher by S&P or
Baa2 or higher by
Moody's (and not
Category 1, 2 or 3) 0.575%
Category 5
Lower than BBB by S&P
and lower than Baa2 by
Moody's 0.800%
For purposes of the foregoing, (i) if no rating for Long-Term Debt shall be
available from either Moody's or S&P, such rating agency shall be deemed to have
established a rating for the Long-Term Debt of Avnet which is one rating grade
higher than the subordinated debt rating grade of Avnet, (ii) if no rating for
Long-Term Debt or subordinated debt of Avnet shall be available from either
Moody's or S&P, the Applicable Margin shall be as set forth in Category 5, (iii)
if the ratings established or deemed to have been established by Moody's and S&P
shall fall within different Categories, the Applicable Margin shall be based
upon the numerically lower Category, provided, however, that if such ratings
shall differ by more than two numerical Categories, the Applicable Margin shall
be based on the Category that is two numerical Categories lower than the
Category containing the lower rating and (iv) if any rating established or
deemed to have been established by
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-2
Moody's or S&P shall be changed (other than as a result of a change in the
rating system of either Moody's or S&P), such change shall be effective as of
the date on which such change is first announced by the rating agency making
such change. Each such change shall apply to all LIBO Rate funds that are
outstanding at any time during the period commencing on the effective date of
such change and ending on the date immediately preceding the effective date of
the next such change. If the rating system of either Moody's or S&P shall change
prior to the Facility Termination Date, Avnet and the Agent shall negotiate in
good faith to amend the references to specific ratings in this definition to
reflect such changed rating system. In addition, for the purposes of this
definition, (i) "S&P" means Standard & Poor's Ratings Services and its
successors, and (ii) "Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its
successors.
"Assignment Agreement" has the meaning set forth in Section 12.1(b).
"Authorized Officer" means, with respect to any Person, its president,
corporate controller, treasurer or chief financial officer.
"Avnet 364-Day Credit Agreement" means that certain Credit Agreement
(364-Day), dated as of October 25, 2001, among Avnet, Inc. and certain other
borrowers and lenders party thereto and Bank of America, N.A., as Administrative
Agent, as the same may be from time to time be supplemented, amended or
modified, together with any renewals, replacements, extensions or refinancings
or substitution refinancings of such agreement or the related Indebtedness.
"Avnet Multi-Year Credit Agreement" means that certain Credit Agreement
(Multi-Year), dated as of October 25, 2001, among Avnet, Inc. and certain other
borrowers and lenders party thereto and Bank of America, N.A., as Agent, as the
same may be from time to time be supplemented, amended or modified, together
with any renewals, replacements, extensions or refinancings or substitution
refinancings of such agreement or the related Indebtedness.
"Avnet Companies" means Avnet, Inc. and each corporation or any other
entity of which securities or other ownership interest having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are at such time directly or indirectly owned by Avnet, Inc.
"Bank One" means Bank One, NA (Main Office Chicago) in its individual
capacity and its successors.
"Bank One Company" means Preferred Receivables Funding Corporation and
its successors.
"Broken Funding Costs" means for any Purchaser Interest which: (i) has
its Capital reduced without compliance by Seller with the notice requirements
hereunder or (ii) does not become subject to an Aggregate Reduction following
the delivery of any Reduction Notice or (iii) is assigned, transferred or funded
pursuant to a Funding Agreement or otherwise transferred or terminated prior to
the date on which it was
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-3
originally scheduled to end; an amount equal to the excess, if any, of (A) the
CP Costs or Yield (as applicable) that would have accrued during the remainder
of the Tranche Periods or the tranche periods for Commercial Paper determined by
the applicable Purchaser to relate to such Purchaser Interest (as applicable)
subsequent to the date of such reduction, assignment or termination (or in
respect of clause (ii) above, the date such Aggregate Reduction was designated
to occur pursuant to the Reduction Notice) of the Capital of such Purchaser
Interest if such reduction, assignment or termination had not occurred or such
Reduction Notice had not been delivered, over (B) the sum of (x) to the extent
all or a portion of such Capital is allocated to another Purchaser Interest, the
amount of CP Costs or Yield actually accrued during the remainder of such period
on such Capital for the new Purchaser Interest, and (y) to the extent such
Capital is not allocated to another Purchaser Interest, the income, if any,
actually received net of any costs of redeployment of funds during the remainder
of such period by the holder of such Purchaser Interest from investing the
portion of such Capital not so allocated. In the event that the amount referred
to in clause (B) exceeds the amount referred to in clause (A), the relevant
Purchaser or Purchasers agree to pay to Seller the amount of such excess. All
Broken Funding Costs shall be due and payable hereunder upon demand.
"Business Day" means any day on which banks are not authorized or
required to close in New York, New York or Chicago, Illinois and The Depository
Trust Company of New York is open for business, and, if the applicable Business
Day relates to any computation or payment to be made with respect to the LIBO
Rate, any day on which dealings in dollar deposits are carried on in the London
interbank market.
"Capital" of any Purchaser Interest means, at any time, (A) the
Purchase Price of such Purchaser Interest, minus (B) the sum of the aggregate
amount of Collections and other payments received by the Agent or any Purchaser
which in each case are applied to reduce such Capital in accordance with the
terms and conditions of this Agreement; provided that such Capital shall be
restored (in accordance with Section 2.5) in the amount of any Collections or
other payments so received and applied if at any time the distribution of such
Collections or payments are rescinded, returned or refunded for any reason.
"Capitalized Lease Indebtedness" means indebtedness incurred pursuant
to a lease that would be capitalized on a balance sheet of the lessee prepared
in accordance with GAAP.
"Change of Control" means (i) the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of 20% or more of the outstanding shares of voting stock
of the Servicer or (ii) Avnet shall cease to own 100% of the outstanding Capital
Stock of Seller free and clear of any Adverse Claim.
"Charged-Off Receivable" means a Receivable: (i) as to which the
Obligor thereof has taken any action, or suffered any event to occur, of the
type described in Section 9.1(d) (as if references to Seller Party therein refer
to such Obligor); (ii) as to
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-4
which the Obligor thereof, if a natural person, is deceased, (iii) which,
consistent with the Credit and Collection Policy, would be written off Seller's
books as uncollectible or (iv) which has been identified by Seller as
uncollectible.
"Collection Account" means each concentration account, depositary
account, lock-box account or similar account in which any Collections are
collected or deposited and which is listed on Exhibit IV.
"Collection Account Agreement" means an agreement substantially in the
form of Exhibit VI, or otherwise in a form approved by Agent, among Originator,
Seller, the Agent and a Collection Bank.
"Collection Bank" means, at any time, any of the banks holding one or
more Collection Accounts.
"Collection Notice" means a notice, in substantially the form of Annex
A to Exhibit VI, from the Agent to a Collection Bank or any similar or analogous
notice from the Agent to a Collection Bank.
"Collections" means, with respect to any Receivable, all cash
collections and other cash proceeds in respect of such Receivable, including,
without limitation, all yield, Finance Charges or other related amounts accruing
in respect thereof and all cash proceeds of Related Security with respect to
such Receivable.
"Commercial Paper" means promissory notes of any Company issued by such
Company in the commercial paper market.
"Commitment" means, for each Financial Institution, the commitment of
such Financial Institution to purchase Purchaser Interests from Seller to the
extent that the Company in its Purchaser Group declines to purchase such
Purchaser Interests, in an amount not to exceed (i) in the aggregate, the amount
set forth opposite such Financial Institution's name on Schedule A to this
Agreement, as such amount may be modified in accordance with the terms hereof
(including, without limitation, any termination of Commitments pursuant to
Section 4.6) and (ii) with respect to any individual purchase hereunder, its Pro
Rata Share of the Purchase Price therefor.
"Company" has the meaning set forth in the preamble to this Agreement.
"Company Costs" has the meaning set forth in Schedule C to this
Agreement in connection with each respective Company.
"Company Purchase Limit" means, for each Company, the purchase limit of
such Company with respect to the purchase of Purchaser Interests from Seller, in
an amount not to exceed (i) in the aggregate, the amount set forth opposite such
Company's name on Schedule A to this Agreement, as such amount may be modified
in accordance with the terms hereof (including Section 4.6(b)) and (ii) with
respect to any individual purchase hereunder, its Pro Rata Share of the Purchase
Price therefor.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-5
"Concentration Limit" means, at any time, for any Obligor, 3.25% of the
aggregate Capital of the Purchaser Interests, or such other amount (a "Special
Concentration Limit") for such Obligor designated by the Agent; provided, that
in the case of an Obligor and any Affiliate of such Obligor, the Concentration
Limit shall be calculated as if such Obligor and such Affiliate are one Obligor;
and provided, further, that the Required Purchasers may, upon not less than
three Business Days' notice to Seller, cancel any Special Concentration Limit.
"Consent Notice" has the meaning set forth in Section 4.6(a).
"Consent Period" has the meaning set forth in Section 4.6(a).
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or application for a letter of credit.
"Contract" means, with respect to any Receivable, any and all
instruments, agreements, leases, invoices or other writings pursuant to which
such Receivable arises or which evidences such Receivable.
"CP Costs" means, for each day, the aggregate discount or yield accrued
with respect to the Purchaser Interests of each respective Company as determined
in accordance with Schedule C to this Agreement.
"Credit and Collection Policy" means Seller's credit and collection
policies and practices relating to Contracts and Receivables existing on the
date of the Original Agreement and summarized in Exhibit VIII hereto, as
modified from time to time in accordance with this Agreement.
"Debt" of any Person means at any date, without duplication (i.e., in
calculating the Debt of the Avnet Companies at any time, without counting the
Guarantee by any such Person of the Debt of any other such Person), (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (c)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable and accrued expenses arising in the
ordinary course of business, (d) all Capitalized Lease Indebtedness, (e) all
Debt of others secured by an Adverse Claim on any asset of such Person, whether
or not such Debt is assumed by such Person (to the extent of the lesser of the
amount of such Debt and the book value of any assets subject to such Adverse
Claim), (f) the maximum amount available to be drawn under all outstanding
standby letters of credit or acceptances issued or created for the account of
such Person, (g) to the extent of any Maturing Amount thereof, any Preference
Stock, and (h) all Debt of others
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-6
Guaranteed by such Person (to the extent of the lesser of the amount of such
Debt Guaranteed or the amount of such Guarantee). The Debt of any Person shall
exclude trade accounts payable and accrued expenses arising in the ordinary
course of such Person's business.
"Deemed Collections" means the aggregate of all amounts Seller shall
have been deemed to have received as a Collection of a Receivable. Seller shall
be deemed to have received a Collection in full of a Receivable if at any time
(i) the Outstanding Balance of any such Receivable is either (x) reduced as a
result of any defective or rejected goods or services, any discount or any
adjustment or otherwise by Seller (other than cash Collections on account of the
Receivables) or (y) reduced or canceled as a result of a setoff in respect of
any claim by any Person (whether such claim arises out of the same or a related
transaction or an unrelated transaction) or (ii) any of the representations or
warranties in Article V are no longer true with respect to any Receivable.
"Default Fee" means with respect to any amount due and payable by
Seller in respect of any Aggregate Unpaids, an amount equal to the greater of
(i) $1000 and (ii) interest on any such unpaid Aggregate Unpaids at a rate per
annum equal to 2% above the Prime Rate.
"Default Ratio" means (X) for any calendar month prior to March of
2001, an amount (expressed as a percentage) equal to (i) the sum of (A) forty
percent (40%) of the aggregate Outstanding Balance of all Receivables that were
unpaid for more than 91 days after the original due date as of the last day of
such calendar month and (B) the aggregate Outstanding Balance of all Receivables
that became Charged-Off Receivables during such calendar month divided by (ii)
the aggregate gross sales of the Originator during the calendar month four
calendar months prior to such calendar month and (Y) for any calendar month from
and including March of 2001, an amount (expressed as a percentage) equal to (i)
the sum of (A) the aggregate Outstanding Balance of all Receivables that were
unpaid for 91 days or more (but less than 121 days) after the original due date
as of the last day of such calendar month and (B) the aggregate Outstanding
Balance of all Receivables that became Charged-Off Receivables during such
calendar month divided by (ii) the aggregate Outstanding Balance of Receivables
originated during the calendar month that is the fourth calendar month prior to
such calendar month.
"Defaulted Receivable" means a Receivable (i) as to which any payment,
or part thereof, remains unpaid for 91 calendar days or more from the original
due date for such payment or (ii) that becomes a Charged-Off Receivable prior to
91 calendar days after the original due date.
"Delinquency Ratio Trigger" means, at any time, a percentage equal to
(i) the aggregate Outstanding Balance of all Receivables that were Delinquent
Receivables at such time divided by (ii) the aggregate Outstanding Balance of
all Receivables at such time.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-7
"Delinquent Receivable" means a Receivable as to which any payment, or
part thereof, remains unpaid for 61 days or more from the original due date for
such payment.
"Designated Obligor" means an Obligor indicated by the Agent to Seller
in writing.
"Dilution Horizon Factor" means, at any time, a percentage equal to (i)
the aggregate amount of Receivables, less the amount of such Receivables that
are rebilled to the Obligor, originated during the two calendar month period
then most recently ended, divided by (ii) the aggregate Outstanding Balance of
all Non-Delinquent Receivables at the end of the calender month period then most
recently ended.
"Dilution Percentage" means as of any date of determination the greater
of (i) 5% and (ii) a percentage calculated in accordance with the following
formula:
DP = [(2 x ADR) + [(HDR - ADR) x (HDR/ADR)]] x DHF]
where:
DP = the Dilution Percentage;
ADR = the average of the monthly Dilution Ratios
occurring during the 12 most recent calendar
months;
HDR = the highest average three-month Dilution Ratio
occurring during the 12 most recent calendar
months; and
DHF = the Dilution Horizon Factor at such time.
"Dilution Ratio" means, at any time, a percentage equal to (i) the
aggregate amount of Dilutions, less the amount of such Dilutions for which the
related Receivables are rebilled to the Obligor, which occurred during the
calendar month period then most recently ended, divided by (ii) the aggregate
amount of Receivables, less the amount of such Receivables that are rebilled to
the Obligor, originated during the calendar month period two months prior to the
month then most recently ended.
"Dilution Ratio Trigger" means, at any time, a percentage equal to (i)
the aggregate amount of Dilutions, less the amount of such Dilutions for which
the related Receivables are rebilled to the Obligor, which occurred during the
calendar month period then most recently ended, divided by (ii) the aggregate
amount of Receivables, less the amount of such Receivables that are rebilled to
the Obligor, originated during the calendar month period two months prior to the
month then most recently ended.
"Dilution Reserve" means, on any date, an amount equal to (i) the
greater of (a) 5% and (b) the Dilution Percentage, multiplied by (ii) the Net
Receivables Balance as of the close of business of the Servicer on such date.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-8
"Dilutions" means, at any time, the aggregate amount of reductions or
cancellations described in clause (i) of the definition of "Deemed Collections".
"Discount Rate" means, the LIBO Rate or the Prime Rate, as applicable,
with respect to each Purchaser Interest of the Financial Institutions.
"Eligible Receivable" means, at any time, a Receivable:
(i) the Obligor of which (a) if a natural person, is a
resident of the United States or, if a corporation or other business
organization, is organized under the laws of the United States or any
political subdivision thereof and has its chief executive office in the
United States; (b) is not an Affiliate of any of the parties hereto;
(c) is not a Designated Obligor; and (d) is not a government or a
governmental subdivision or agency,
(ii) the Obligor of which is not the Obligor of any Defaulted
Receivable, which in the aggregate constitute more than 25% of all
Receivables of such Obligor,
(iii) which is not a Charged-Off Receivable or a Delinquent
Receivable,
(iv) which by its terms is due and payable (A) within 45
calendar days of the original billing date therefor and has not had its
payment terms extended or (B) within 60 calendar days of the billing
date therefor and has not had its payment terms extended, provided that
with respect to subsection (B) hereof the total amount of Eligible
Receivables permitted pursuant to this subsection (B) shall not exceed,
on the date of any Monthly Report, 10% of the aggregate amount of
Eligible Receivables as set forth on such Monthly Report,
(v) which is an "account" within the meaning of the UCC of all
applicable jurisdictions,
(vi) which is denominated and payable only in United States
dollars in the United States,
(vii) which arises under a Contract in substantially the form
of or containing comparable basic provisions as one of the form
contracts set forth on Exhibit IX hereto, or if such form contracts are
modified in any material respect, the Seller Parties will use
reasonable efforts to give prior written notice of and provide a copy
of such modified Contract to the Agent prior to its use, which,
together with such Receivable, is in full force and effect and
constitutes the legal, valid and binding obligation of the related
Obligor enforceable against such Obligor in accordance with its terms
subject to no offset, counterclaim or other defense,
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-9
(viii) which arises under a Contract which does not contain a
confidentiality provision that purports to restrict the ability of any
Purchaser to exercise its rights under this Agreement, including,
without limitation, its right to review the Contract,
(ix) which arises under a Contract that contains an obligation
to pay a specified sum of money, contingent only upon the sale or lease
of goods or the provision of services by Originator,
(x) which, together with the Contract related thereto, does
not contravene any law, rule or regulation applicable thereto
(including, without limitation, any law, rule and regulation relating
to truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy) and
with respect to which no part of the Contract related thereto is in
violation of any such law, rule or regulation,
(xi) which satisfies all applicable requirements of the Credit
and Collection Policy,
(xii) which was generated in the ordinary course of
Originator's business,
(xiii) which arises solely from the sale of goods or the
provision of services, to the related Obligor by Originator, and not by
any other Person (in whole or in part),
(xiv) as to which the Agent has not notified Seller that the
Agent has determined that such Receivable or class of Receivables is
not acceptable as an Eligible Receivable, including, without
limitation, because such Receivable arises under a Contract that is not
acceptable to the Agent,
(xv) which is not subject to any right of rescission, set-off,
counterclaim, any other defense (including defenses arising out of
violations of usury laws) of the applicable Obligor against Originator
or any other Adverse Claim, and the Obligor thereon holds no right as
against Originator to cause Originator to repurchase the goods or
merchandise the sale of which shall have given rise to such Receivable
(except with respect to sale discounts effected pursuant to the
Contract, or defective goods returned in accordance with the terms of
the Contract),
(xvi) as to which Originator has satisfied and fully performed
all obligations on its part with respect to such Receivable required to
be fulfilled by it, and no further action is required to be performed
by any Person with respect thereto other than payment thereon by the
applicable Obligor, and
(xvii) all right, title and interest to and in which has been
validly transferred by Originator directly to Seller under and in
accordance with the
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-10
Receivables Sale Agreement, and Seller has good and marketable title
thereto free and clear of any Adverse Claim.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Excluded Receivable" means all indebtedness and other obligations owed
to Originator or in which Originator has a security interest or other interest
(including, without limitation, any indebtedness, obligation or interest
constituting an account, chattel paper, instrument or general intangible)
arising in connection with the sale or lease of goods or the rendering of
services by Originator and further includes, without limitation, the obligation
to pay any Finance Charges with respect thereto, which, in any case, General
Electric Capital Corporation has or could finance, fund, purchase or otherwise
acquire pursuant to that certain Agreement, dated October 12, 1998, between
General Electric Capital Corporation and Avnet, Inc. Indebtedness and other
rights and obligations arising from any one transaction, including, without
limitation, indebtedness and other rights and obligations represented by an
individual invoice, shall constitute an Excluded Receivable separate from an
Excluded Receivable consisting of the indebtedness and other rights and
obligations arising from any other transaction; provided, that any indebtedness,
rights or obligations referred to in the immediately preceding sentence shall be
an Excluded Receivable regardless of whether the account debtor or Seller treats
such indebtedness, rights or obligations as a separate payment obligation. For
the avoidance of doubt, 'Excluded Receivable' shall include, without limitation,
all such indebtedness and other obligations for which AlliedSignal, Inc. or
Honeywell International Inc. is the account debtor during the period that the
Agreement, dated October 12, 1998, between General Electric Capital Corporation
and Avnet, Inc. is in effect.
"Extension Notice" has the meaning set forth in Section 4.6(a).
"Facility Account" means Seller's Account No. ▇▇▇▇▇▇▇ at Bank One.
"Facility Termination Date" means the earliest of (i) June 28, 2006,
(ii) the Liquidity Termination Date and (iii) the Amortization Date.
"Federal Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy," as amended and any successor statute thereto.
"Federal Funds Effective Rate" means, for any period, a fluctuating
interest rate per annum for each day during such period equal to (a) the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the preceding
Business Day) by the Federal Reserve Bank of New York in the Composite Closing
Quotations for U.S. Government Securities; or (b) if such rate is not so
published for any day which is a Business Day, the average of the quotations at
approximately 10:30 a.m. (Chicago time) for such day on such transactions
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-11
received by the Agent from three federal funds brokers of recognized standing
selected by it.
"Fee Letter" means each of (i) the amended and restated letter
agreements relating to the payment of fees to Agent, dated as of the date
hereof, among Seller, the Bank One Company and the Agent, as each such letter
agreement may be amended or modified and in effect from time to time and (ii)
the letter agreement relating to the payment of fees to the Scotia Company and
to Scotia, dated as of the date hereof, among Seller, the Scotia Company and
Scotia, as it may be amended or modified and in effect from time to time.
"Finance Charges" means, with respect to a Contract, any finance,
interest, late payment charges or similar charges owing by an Obligor pursuant
to such Contract.
"Financial Institutions" has the meaning set forth in the preamble in
this Agreement.
"Funding Agreement" means this Agreement and any agreement or
instrument executed by any Funding Source with or for the benefit of a Company.
"Funding Source" means with respect to any Company (i) such Company's
Related Financial Institution(s) or (ii) any insurance company, bank or other
funding entity providing liquidity, credit enhancement or back-up purchase
support or facilities to such Company.
"GAAP" means generally accepted accounting principles in effect in the
United States of America as of the date of this Agreement.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (a) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (b) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the payment thereof
or to protect such obligee against loss in respect thereof (in whole or in
part); provided that the term Guarantee shall not include endorsement for
collection or deposit in the ordinary course of business. The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable
amount of the related primary obligation, or portion thereof, in respect of
which such Guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
guarantying Person in good faith.
"Incremental Purchase" means a purchase of one or more Purchaser
Interests which increases the total outstanding Aggregate Capital hereunder.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-12
"Indebtedness" of a Person means such Person's (i) obligations for
borrowed money, (ii) obligations representing the deferred purchase price of
property or services (other than accounts payable arising in the ordinary course
of such Person's business payable on terms customary in the trade), (iii)
obligations, whether or not assumed, secured by liens or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) capitalized lease obligations, (vi) net liabilities under
interest rate swap, exchange or cap agreements, (vii) Contingent Obligations and
(viii) liabilities in respect of unfunded vested benefits under plans covered by
Title IV of ERISA.
"Independent Director" shall mean a member of the Board of Directors of
Seller who is not at such time, and has not been at any time during the
preceding five (5) years, (A) a director, officer, employee or affiliate of
Seller, Originator, or any of their respective Subsidiaries or Affiliates, or
(B) the beneficial owner (at the time of such individual's appointment as an
Independent Director or at any time thereafter while serving as an Independent
Director) of any of the outstanding common shares of Seller, Originator, or any
of their respective Subsidiaries or Affiliates, having general voting rights.
"LIBO Rate" means the sum of (i)(a) the rate per annum (rounded
upwards, if necessary, to the next 1/100 of 1%) appearing on Telerate Page 3750
(or any successor page) as the London Interbank offered rate for deposits in
U.S. dollars at approximately 11:00 a.m. (London time) two Business Days prior
to the first day of the relevant Tranche Period and for delivery on the first
day of such Tranche Period, for the number of days comprised therein, and in an
amount equal to or comparable to the amount of the Capital associated with such
Tranche Period (provided, that if at least two such offered rates appear on
Telerate Page 3750, the rate in respect of such Tranche Period will be the
arithmetic mean of such offered rates), divided by (b) one minus a percentage
(expressed as a decimal) equal to the daily average during such Tranche Period
of the percentage in effect on each day of such Tranche Period, as prescribed by
the Board of Governors of the Federal Reserve System (or any successor thereto),
for determining the aggregate maximum reserve requirements applicable to
"Eurocurrency Liabilities" pursuant to Regulation D or any other then applicable
regulation of such Board of Governors which prescribes reserve requirements
applicable to "Eurocurrency Liabilities" as presently defined in Regulation D,
plus (ii) the Applicable Margin. If for any reason the foregoing rates are
unavailable from the Telerate service, then such rate of interest shall be based
upon Reuters or another market quotation rate source as determined by Bank One,
N.A..
"Liquidity Provider Termination Date" has the meaning set forth in
Section 2.2.
"Liquidity Termination Date" means June 27, 2002.
"Lock-Box" means each locked postal box with respect to which a bank
who has executed a Collection Account Agreement has been granted exclusive
access for the purpose of retrieving and processing payments made on the
Receivables and which is listed on Exhibit IV.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-13
"Long-Term Debt" means, at any time, in respect of Avnet, any
publicly-held senior unsecured debt obligations outstanding at any such time
with a maturity more than one year after the date of any determination
hereunder.
"Loss Horizon Factor" means, at any time, a percentage equal to (i) the
aggregate amount of Receivables, less the amount of such Receivables that are
rebilled to the Obligor, originated during the three calendar month period then
most recently ended, divided by (ii) the aggregate Outstanding Balance of all
Non-Delinquent Receivables at the end of the calender month period then most
recently ended.
"Loss Percentage" means at any time the greater of (i) 10% and (ii) a
percentage calculated in accordance with the following formula:
LP = 2 x LHF x LR
where:
LP = the Loss Percentage;
LHF = the Loss Horizon Factor; and
LR = the highest three month rolling average
of the Default Ratios occurring during the
12 most recent calendar months.
"Loss Reserve" means, on any date, an amount equal to the Loss
Percentage multiplied by the Net Receivables Balance as of the close of business
of the Servicer on such date.
"Loss Ratio Trigger" means, at any time, a percentage equal to (i) the
aggregate Outstanding Balance of all Receivables that were Defaulted Receivables
at such time, divided by (ii) the aggregate Outstanding Balance of all
Receivables at such time.
"Material Adverse Effect" means a material adverse effect on (i) the
financial condition or operations of any Seller Party and its Subsidiaries, (ii)
the ability of any Seller Party to perform its obligations under this Agreement,
(iii) the legality, validity or enforceability of this Agreement or any other
Transaction Document, (iv) any Purchaser's interest in the Receivables generally
or in any significant portion of the Receivables, the Related Security or the
Collections with respect thereto, or (v) the collectibility of the Receivables
generally or of any material portion of the Receivables.
"Maturing Amount" means, with respect to any Preference Stock, an
amount equal to the aggregate amount of such Preference Stock that will or may
become due before the "Scheduled Maturity Date" as defined in the Avnet 364-Day
Credit Agreement (or the analogous date set forth in any agreement renewing,
replacing, extending or refinancing the Avnet 364-Day Credit Agreement or the
related Indebtedness) as a result of any scheduled maturity, amortization or
mandatory redemption thereof.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-14
"Monthly Report" means a report, in substantially the form of Exhibit X
hereto (appropriately completed), furnished by the Servicer to the Agent and
Scotia pursuant to Section 8.5.
"Net Receivables Balance" means, at any time, the aggregate Outstanding
Balance of all Eligible Receivables at such time reduced by the aggregate amount
by which the Outstanding Balance of all Eligible Receivables of each Obligor and
its Affiliates exceeds the Concentration Limit for such Obligor.
"Non-Delinquent Receivables" means, at any time, the aggregate
Outstanding Balance of all Receivables that are not Delinquent Receivables.
"Non-Renewing Financial Institution" has the meaning set forth in
Section 4.6(a).
"Obligations" shall have the meaning set forth in Section 2.1.
"Obligor" means a Person obligated to make payments pursuant to a
Contract.
"Originator" means Avnet, Inc., in its capacity as seller under the
Receivables Sale Agreement.
"Original Agreement" has the meaning set forth in the Preliminary
Statements to this Agreement.
"Other Servicer Collected Funds" means any cash collections, other cash
proceeds or other amounts deposited, credited or funded to any Collection
Account, to the extent such cash collections, other cash proceeds or other
amounts do not constitute Collections.
"Outstanding Balance" of any Receivable at any time means the then
outstanding principal balance thereof.
"Participant" has the meaning set forth in Section 12.2.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"Pooled Commercial Paper" has the meaning set forth in Schedule C to
this Agreement.
"Potential Amortization Event" means an event which, with the passage
of time or the giving of notice, or both, would constitute an Amortization
Event.
"Preference Stock" means, with respect to any issuer, capital stock of
such issuer which, under the certificate of incorporation and by-laws or other
constitutional documents of such issuer, such issuer is entitled to a preference
over any other capital
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-15
stock of such issuer as to payment of dividends and/or distributions upon the
voluntary or involuntary liquidation of such issuer.
"Prime Rate" means a rate per annum equal to the higher of (1) prime
rate of interest announced from time to time by Bank One or its parent and (2)
the Federal Funds Effective Rate most recently determined by Bank One plus
-1/2%.
"Proposed Reduction Date" has the meaning set forth in Section 1.3.
"Pro Rata Share" means, (a) for each Financial Institution, a
percentage equal to (i) the Commitment of such Financial Institution, divided by
(ii) the aggregate amount of all Commitments of all Financial Institutions in
such Financial Institution's Purchaser Group, adjusted as necessary to give
effect to the application of the terms of Section 4.6 and (b) for each Company,
a percentage equal to (i) the Company Purchase Limit of such Company, divided by
(ii) the aggregate amount of all Company Purchase Limits of all Companies
hereunder.
"Purchase Limit" means $450,000,000, as such amount may be modified in
accordance with the terms of Section 4.6(b).
"Purchase Notice" has the meaning set forth in Section 1.2.
"Purchase Price" means, with respect to any Incremental Purchase of a
Purchaser Interest, the amount paid to Seller for such Purchaser Interest which
shall not exceed the least of (i) the amount requested by Seller in the
applicable Purchase Notice, (ii) the unused portion of the Purchase Limit on the
applicable purchase date and (iii) the excess, if any, of the Net Receivables
Balance (less the Aggregate Reserves) on the applicable purchase date over the
aggregate outstanding amount of Aggregate Capital determined as of the date of
the most recent Monthly Report, taking into account such proposed Incremental
Purchase.
"Purchaser Group" means with respect to (i) each Company, a group
consisting of such Company and its Related Financial Institutions and (ii) each
Financial Institution, a group consisting of such Financial Institution, the
Company for which such Financial Institution is a Related Financial Institution
and each other Financial Institution that is a Related Financial Institution for
such Company.
"Purchasers" means each Company and each Financial Institution.
"Purchaser Interest" means, at any time, an undivided percentage
ownership interest (computed as set forth below) associated with a designated
amount of Capital, selected pursuant to the terms and conditions hereof in (i)
each Receivable arising prior to the time of the most recent computation or
recomputation of such undivided interest, (ii) all Related Security with respect
to each such Receivable, and (iii) all Collections with respect to, and other
proceeds of, each such Receivable. Each such undivided percentage interest shall
equal:
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-16
C
--------------
(NRB - AR)
where:
C = the Capital of such Purchaser Interest.
AR = the Aggregate Reserves.
NRB = the Net Receivables Balance.
Such undivided percentage ownership interest shall be initially computed on its
date of purchase. Thereafter, until the Amortization Date, each Purchaser
Interest shall be automatically recomputed (or deemed to be recomputed) on each
day prior to the Amortization Date. The variable percentage represented by any
Purchaser Interest as computed (or deemed recomputed) as of the close of the
business day immediately preceding the Amortization Date shall remain constant
at all times thereafter.
"Purchasing Financial Institution" has the meaning set forth in Section
12.1(b).
"Receivable" means all indebtedness and other obligations owed to
Seller or Originator (at the time it arises, and before giving effect to any
transfer or conveyance under the Receivables Sale Agreement, the Original
Agreement or hereunder) or in which Seller or Originator has a security interest
or other interest, including, without limitation, any indebtedness, obligation
or interest constituting an account, chattel paper, instrument or general
intangible, arising in connection with the sale or lease of goods or the
rendering of services by Originator, and further includes, without limitation,
the obligation to pay any Finance Charges with respect thereto; provided, that
'Receivable' shall not include any Excluded Receivable. Indebtedness and other
rights and obligations arising from any one transaction, including, without
limitation, indebtedness and other rights and obligations represented by an
individual invoice, shall constitute a Receivable separate from a Receivable
consisting of the indebtedness and other rights and obligations arising from any
other transaction; provided, that any indebtedness, rights or obligations
referred to in the immediately preceding sentence shall be a Receivable
regardless of whether the account debtor or Seller treats such indebtedness,
rights or obligations as a separate payment obligation.
"Receivables Sale Agreement" means that certain Receivables Sale
Agreement, dated as of June 28, 2001 and amended by the RSA Amendment, between
Originator and Seller, as the same may be further amended, restated or otherwise
modified from time to time.
"Records" means, with respect to any Receivable, all Contracts and
other documents, books, records and other information (including, without
limitation, computer programs, tapes, disks, punch cards, data processing
software and related property and rights) relating to such Receivable, any
Related Security therefor and the related Obligor.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-17
"Reduction Notice" has the meaning set forth in Section 1.3.
"Regulatory Change" has the meaning set forth in Section 10.2(a).
"Reinvestment" has the meaning set forth in Section 2.2.
"Related Financial Institution" means with respect to each Company,
each Financial Institution set forth opposite such Company's name in Schedule A
to this Agreement and/or, in the case of an assignment pursuant to Section 12.1,
set forth in the applicable Assignment Agreement.
"Related Security" means, with respect to any Receivable:
(i) all of Seller's interest in the inventory and goods
(including returned or repossessed inventory or goods), if any, the
sale, financing or lease of which by Originator gave rise to such
Receivable, and all insurance contracts with respect thereto,
(ii) except to the extent prohibited by the terms of any
Contract (unless, and to the extent, such prohibition is rendered
ineffective by law, including, without limitation, statutory
authority), all other security interests or liens and property subject
thereto from time to time, if any, purporting to secure payment of such
Receivable, whether pursuant to the Contract related to such Receivable
or otherwise, together with all financing statements and security
agreements describing any collateral securing such Receivable,
(iii) except to the extent prohibited by the terms of any
Contract (unless, and to the extent, such prohibition is rendered
ineffective by law, including, without limitation, statutory
authority), all guaranties, letters of credit, insurance, "supporting
obligations" (within the meaning of Section 9-102(a) of the UCC of all
applicable jurisdictions) and other agreements or arrangements of
whatever character from time to time supporting or securing payment of
such Receivable whether pursuant to the Contract related to such
Receivable or otherwise,
(iv) except to the extent prohibited by the terms of any
Contract (unless, and to the extent, such prohibition is rendered
ineffective by law, including, without limitation, statutory
authority), all service contracts and other contracts and agreements
associated with such Receivable,
(v) all Records related to such Receivable,
(vi) all of Seller's right, title and interest in, to and
under the Receivables Sale Agreement in respect of such Receivable, and
(vii) all proceeds of any of the foregoing.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-18
"Required Notice Period" means the number of days required notice set
forth below applicable to the Aggregate Reduction indicated below:
Aggregate Reduction Required Notice Period
------------------- ----------------------
(Less than
or equal to) $100,000,000 two Business Days
$100,000,000 to $250,000,000 five Business Days
(Greater than) $250,000,000 ten Business Days
"Required Purchasers" means, at any time, collectively, the Financial
Institutions with Commitments in excess of 66-2/3% of the aggregate Commitments
and the Companies with Company Purchase Limits in excess of 66-2/3% of the
aggregate amount of all Company Purchase Limits of all Companies hereunder.
"Restricted Junior Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any shares of any class of
capital stock of Seller now or hereafter outstanding, except a dividend payable
solely in shares of that class of stock or in any junior class of stock of
Seller, (ii) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of capital stock of Seller now or hereafter outstanding, (iii) any
payment or prepayment of principal of, premium, if any, or interest, fees or
other charges on or with respect to, and any redemption, purchase, retirement,
defeasance, sinking fund or similar payment and any claim for rescission with
respect to the Subordinated Loans (as defined in the Receivables Sale
Agreement), (iv) any payment made to redeem, purchase, repurchase or retire, or
to obtain the surrender of, any outstanding warrants, options or other rights to
acquire shares of any class of capital stock of Seller now or hereafter
outstanding, and (v) any payment of management fees by Seller (except for
reasonable management fees to the Originator or its Affiliates in reimbursement
of actual management services performed).
"RSA Amendment" means that certain Amendment No. 1 to Receivables Sale
Agreement, dated as of February 6, 2002, between Originator and Seller.
"Scotia" has the meaning set forth in the Preliminary Statements to
this Agreement.
"Scotia Capital" has the meaning set forth in Section 13.15(a).
"Scotia Company" has the meaning set forth in the Preliminary
Statements to this Agreement.
"Seller" has the meaning set forth in the preamble to this Agreement.
"Seller Parties" has the meaning set forth in the preamble to this
Agreement.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-19
"Servicer" means at any time the Person (which may be the Agent) then
authorized pursuant to Article VIII to service, administer and collect
Receivables.
"Servicing and Yield Reserve" means, on any date, an amount equal to 2%
multiplied by the Net Receivables Balance as of the close of business of the
Servicer on such date.
"Servicing Fee" has the meaning set forth in Section 8.6.
"Settlement Date" means (A) the 20th calendar day at each month (and if
such day is not a Business Day, then the next Business Day), and (B) the last
day of the relevant Tranche Period in respect of each Purchaser Interest of any
Financial Institution.
"Settlement Period" means (A) in respect of each Purchaser Interest of
the Companies, the immediately preceding Accrual Period, and (B) in respect of
each Purchaser Interest of any Financial Institution, the entire Tranche Period
of such Purchaser Interest.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, association, limited liability company, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of Seller.
"Terminating Commitment Amount" means, with respect to any Terminating
Financial Institution, an amount equal to the Commitment (without giving effect
to clause (iii) of the proviso to the penultimate sentence of Section 4.6(b)) of
such Terminating Financial Institution, minus, an amount equal to 2% of such
Commitment.
"Terminating Commitment Availability" means, with respect to any
Terminating Financial Institution, the positive difference (if any) between (a)
an amount equal to the Commitment (without giving effect to clause (iii) of the
proviso to the penultimate sentence of Section 4.6(b)) of such Terminating
Financial Institution, minus, an amount equal to 2% of such Commitment minus (b)
the Capital of the Purchaser Interests funded by such Terminating Financial
Institution.
"Terminating Financial Institution" shall have the meaning set forth in
Section 4.6(b).
"Termination Percentage" has the meaning set forth in Section 2.2.
"Terminating Tranche" has the meaning set forth in Section 4.3(b).
"Tranche Period" means, with respect to any Purchaser Interest held by
a Financial Institution:
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-20
(a) if Yield for such Purchaser Interest is calculated on the
basis of the LIBO Rate, a period of one, two, three, four or six months,
commencing on a Business Day selected by Seller or the applicable Financial
Institution pursuant to this Agreement. Such Tranche Period shall end on the day
in the applicable succeeding calendar month which corresponds numerically to the
beginning day of such Tranche Period, provided, however, that if there is no
such numerically corresponding day in such succeeding month, such Tranche Period
shall end on the last Business Day of such succeeding month; or
(b) if Yield for such Purchaser Interest is calculated on the
basis of the Prime Rate, a period commencing on a Business Day selected by
Seller and agreed to by the applicable Financial Institution, provided no such
period shall exceed one month.
If any Tranche Period would end on a day which is not a Business Day, such
Tranche Period shall end on the next succeeding Business Day, provided, however,
that in the case of Tranche Periods corresponding to the LIBO Rate, if such next
succeeding Business Day falls in a new month, such Tranche Period shall end on
the immediately preceding Business Day. In the case of any Tranche Period for
any Purchaser Interest which commences before the Amortization Date and would
otherwise end on a date occurring after the Amortization Date, such Tranche
Period shall end on the Amortization Date. The duration of each Tranche Period
which commences after the Amortization Date shall be of such duration as
selected by the applicable Financial Institution.
"Transaction Documents" means, collectively, this Agreement, the
Original Agreement, each Purchase Notice, the Receivables Sale Agreement, the
RSA Amendment, each Collection Account Agreement, the Fee Letters, the
Subordinated Note (as defined in the Receivables Sale Agreement) and all other
instruments, documents and agreements executed and delivered in connection
herewith or in connection with the Original Agreement.
"UCC" means the Uniform Commercial Code as from time to time in effect
in the specified jurisdiction.
"Yield" means for each respective Tranche Period relating to Purchaser
Interests of the Financial Institutions, an amount equal to the product of the
applicable Discount Rate for each Purchaser Interest multiplied by the Capital
of such Purchaser Interest for each day elapsed during such Tranche Period,
annualized on a 360 day basis.
All accounting terms not specifically defined herein shall be construed
in accordance with GAAP. All terms used in Article 9 of the UCC in the State of
New York, and not specifically defined herein, are used herein as defined in
such Article 9. All section references herein to the UCC shall include all
successor sections under any subsequent version or amendment to any Article of
the UCC.
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Exh I-21