EXHIBIT 4.14
EXECUTION COPY
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RECEIVABLES PURCHASE AGREEMENT
Dated as of May 7, 2004
among
VVP FUNDING CORPORATION,
as Seller,
VITRO AMERICA, INC.,
as initial Servicer,
WINDMILL FUNDING CORPORATION,
THE COMMITTED PURCHASERS FROM TIME TO TIME PARTY HERETO,
and
ABN AMRO BANK N.V.,
as Agent
ABN AMRO BANK N.V., as Arranger
and
FINACITY CORPORATION, as Co-Arranger
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TABLE OF CONTENTS
SECTION HEADING PAGE
ARTICLE I PURCHASE ARRANGEMENTS....................................1
Section 1.1. Purchase Facility.........................................1
Section 1.2. Incremental Purchases.....................................2
Section 1.3. Decreases.................................................3
Section 1.4. Deemed Collections; Purchase Limit........................3
Section 1.5. Payment Requirements and Computations.....................4
ARTICLE II SALES TO AND FROM THE CONDUIT; PAYMENTS AND COLLECTIONS...4
Section 2.1. Required Purchases from the Conduit.......................4
Section 2.2. Purchases by the Conduit..................................5
Section 2.3. Payments of Recourse Obligations..........................5
Section 2.4. Collections Prior to the Facility Termination Date........6
Section 2.5. Application of Collections After the Facility Termination
Date.........................7
Section 2.6. Payment Rescission........................................7
Section 2.7. Clean Up Call; Reconveyance of Receivable Interests.......8
ARTICLE III COMMERCIAL PAPER FUNDING..................................8
Section 3.1. CP Costs..................................................8
Section 3.2. Calculation of CP Costs...................................8
Section 3.3. CP Costs Payments.........................................8
Section 3.4. Default Rate..............................................8
ARTICLE IV COMMITTED PURCHASE FUNDING................................9
Section 4.1. Liquidity Fundings........................................9
Section 4.2. Yield Payments............................................9
Section 4.3. Selection and Continuation of Tranche Periods.............9
Section 4.4. Suspension of the LIBO Rate...............................9
Section 4.5. Default Rate.............................................10
ARTICLE V REPRESENTATIONS AND WARRANTIES...........................10
Section 5.1. Representations and Warranties of the Seller Parties.....10
ARTICLE VI CONDITIONS OF PURCHASES..................................14
Section 6.1. Conditions Precedent to Initial Incremental Purchase.....14
Section 6.2. Conditions Precedent to All Purchases and Reinvestments..15
ARTICLE VII COVENANTS................................................16
Section 7.1. Affirmative Covenants of the Seller Parties..............16
Section 7.2. Negative Covenants of the Seller Parties.................24
Section 7.3. Post-Office Boxes and Depositary Accounts................26
ARTICLE VIII ADMINISTRATION AND COLLECTION............................26
Section 8.1. Designation of Servicer..................................27
Section 8.2. Duties of Servicer.......................................27
Section 8.3. Collection Notices.......................................29
Section 8.4. Responsibilities of the Seller...........................29
Section 8.5. Investment Reports.......................................29
Section 8.6. Servicing Fee............................................29
ARTICLE IX AMORTIZATION EVENTS......................................29
Section 9.1. Amortization Events......................................29
Section 9.2. Remedies.................................................33
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.................................36
Section 10.4. Allocations..............................................37
ARTICLE XI THE AGENT................................................37
Section 11.1. Authorization and Action.................................37
ARTICLE XII ASSIGNMENTS AND PARTICIPATIONS...........................37
Section 12.1. Successors and Assigns; Participations; Assignments......37
Section 12.2. Prohibition on Assignments by the Seller Parties.........39
ARTICLE XIII MISCELLANEOUS............................................39
Section 13.1. Waivers and Amendments...................................39
Section 13.2. Notices..................................................40
Section 13.3. Protection of Agent's Security Interest..................40
Section 13.4. Confidentiality..........................................41
Section 13.5. Bankruptcy Petition......................................42
Section 13.6. Limitation of Liability..................................42
Section 13.7. Choice of Law............................................42
Section 13.8. Consent to Jurisdiction..................................42
Section 13.9. Waiver of Jury Trial.....................................43
Section 13.10. Integration; Binding Effect; Survival of Terms...........43
Section 13.11. Counterparts; Severability; Section References...........43
Section 13.12. Characterization; Power of Attorney......................43
Section 13.13. Excess Funds.............................................44
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Section 13.14. Sharing of Recoveries....................................45
EXHIBITS
Exhibit I -- Definitions
Exhibit II -- Form of Purchase Notice
Exhibit III -- Jurisdiction of Organization, Places of Business of the
Seller Parties; Locations of Records; Federal Employer
Identification Number(s); Other Names
Exhibit IV -- Names of Collection Banks; Lock-Boxes and Collection
Accounts
Exhibit V -- Form of Compliance Certificate
Exhibit VI -- Form of Collection Account Agreement
Exhibit VII -- Credit and Collection Policy
Exhibit VIII -- Form of Daily Report
Exhibit IX -- Form of Weekly Report
Exhibit X -- Form of Performance Undertaking
Exhibit XI -- Form of Power of Attorney
Exhibit XII -- Form of Reduction Notice
Exhibit XIII -- Form of Monthly Report
Exhibit XIV -- Form of Postal Power of Attorney
Exhibit XV -- Form of Postal Direction Letter
Exhibit XVI -- Post-Office Boxes
Exhibit XVII -- Form of Notification of Assignment to the Conduit from the
Committed Purchasers
SCHEDULES
Schedule A -- Closing Documents
Schedule B -- Committed Purchaser Commitments
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RECEIVABLES PURCHASE AGREEMENT
This Receivables Purchase Agreement, dated as of May 7, 2004 is entered
into by and among:
(a) VVP Funding Corporation, a Delaware corporation (the "Seller"),
(b) Vitro America, Inc., a Delaware corporation ("Vitro America"),
as initial Servicer (the Servicer together with the Seller, the "Seller
Parties" and each, a "Seller Party"),
(c) Windmill Funding Corporation (the "Conduit"),
(d) the committed purchasers party hereto, and
(e) ABN AMRO Bank N.V., as agent for the Purchasers and their
respective assigns under the Transaction Documents and under the
Liquidity Agreement (together with its successors and assigns in such
capacity, the "Agent").
Unless defined elsewhere herein, capitalized terms used in this Agreement
shall have the meanings assigned to such terms in Exhibit I attached hereto.
PRELIMINARY STATEMENTS
The Seller desires to transfer and assign Receivable Interests from
time to time.
The Conduit may, in its absolute and sole discretion, purchase
Receivable Interests from the Seller from time to time.
In the event that the Conduit declines to make any such purchase, the
Committed Purchasers shall purchase Receivable Interests from the Seller from
time to time.
ABN AMRO Bank N.V. has been requested and is willing to act as Agent
on behalf of the Purchasers and their respective assigns in accordance with
the terms hereof.
ARTICLE I
PURCHASE ARRANGEMENTS
Section 1.1. Purchase Facility. (a) Upon the terms and subject to the
conditions of this Agreement (including, without limitation, Article VI), from
time to time prior to the Facility Termination Date, the Seller may request
that the Conduit purchase from the Seller
undivided ownership interests in the Receivables and the associated Related
Security and Collections, and the Conduit may, in its sole discretion, make
such purchase, or, only if the Conduit shall decline to make any such
purchase, the Committed Purchasers shall ratably purchase from the Seller
undivided ownership interests in the Receivables and the associated Related
Security and Collections, in each case without recourse except as provided
herein; provided that no Purchase shall be made by any Purchaser hereunder if,
after giving effect thereto, either (i) the Aggregate Invested Amount would
exceed the Purchase Limit, or (ii) the aggregate of the Receivable Interests
would exceed 100%.
(b) Conduit Purchase Option and Other Purchasers' Commitments. Subject to
Section 2.4 concerning Reinvestments, at no time will the Conduit have any
obligation to make a Purchase. Each purchaser listed on Schedule B hereto
(together, the "Committed Purchasers" and each, a "Committed Purchaser")
severally hereby agrees, subject to Section 6.2 and the other terms and
conditions hereof (including, in the case of an Incremental Purchase, that the
Conduit has refused to make a requested Purchase), to make Purchases before
the Facility Termination Date, based on its Ratable Share of each Purchase, to
the extent its Invested Amount would not thereby exceed its Commitment, the
Aggregate Invested Amount would not thereby exceed the Purchase Limit, and the
Matured Aggregate Invested Amount would not thereby exceed the Aggregate
Commitments. Each Purchaser's first Purchase and each additional Purchase by
such Purchaser not made from Collections pursuant to Section 2.2 is referred
to herein as an "Incremental Purchase."
(c) The Seller may, upon thirty days' notice to the Agent, reduce the
Aggregate Commitment in increments of $1,000,000, so long as the Aggregate
Commitment as so reduced is no less than the Matured Aggregate Investment.
Each such reduction in the Aggregate Commitment shall reduce the Commitment of
each Committed Purchaser in accordance with its Ratable Share and shall reduce
the Purchase Limit so that the Aggregate Commitment remains at least 102% of
the Purchase Limit and the Purchase Limit is no less than the outstanding
Aggregate Investment.
Section 1.2. Incremental Purchases. The Seller shall provide the Agent an
irrevocable written request in a form set forth as Exhibit II hereto of each
Incremental Purchase (each, a "Purchase Notice") by (i) 10:00 a.m. (Chicago
time) two Business Days before the requested date (the "Purchase Date") of
such Purchase, in the case of a Purchase by the Conduit, (ii) 10:00 a.m.
(Chicago time) three Business Days before the Purchase Date in the case of
each Purchase by the Committed Purchasers that is to accrue Yield at the LIBO
Rate and (iii) 10:00 a.m. (Chicago time) on the Purchase Date in the case of
each Purchase by the Committed Purchasers that is to accrue Yield at the Prime
Rate, or, in each of the foregoing cases, such later time or day as the
Conduit or the Committed Purchasers, as applicable, shall agree. Each such
notice shall specify the requested Purchase Date (which must be a Business
Day) and the requested Purchase Price, which must be in a minimum amount of
$1,000,000 and multiples thereof (or, if less, an amount equal to the Maximum
Incremental Purchase Amount). If the Conduit determines, in its sole
discretion, to make all or any portion of the requested Purchase, the Conduit
shall transfer to the Agent's Account the Purchase Price (or portion thereof)
on the requested Purchase Date. If the Conduit determines, in its sole
discretion, not to make all or any portion of a requested Purchase, each
Committed Purchaser shall transfer its Ratable Share of that portion of the
requested Purchase Price not funded by the Conduit into the Agent's Account by
no later than 12:00 noon (Chicago time) on the Purchase Date (which, in the
case of a Purchase that is to accrue Yield at the LIBO Rate, in no event will
be earlier than three
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Business Days after such request is made to the Committed Purchasers). The
Agent shall transfer to the Facility Account the proceeds of any Incremental
Purchase delivered into the Agent's Account. No Incremental Purchase shall be
made if after giving effect to the payment of the Purchase Price, the
Aggregate Invested Amount would exceed the Purchase Limit or the aggregate
Receivables Interest would exceed 100%.
Section 1.3. Decreases. (a) Optional. The Seller shall provide the Agent
with prior written notice in substantially the form of Exhibit XII and in
conformity with the Required Notice Period (a "Reduction Notice") of any
proposed reduction of Aggregate Invested Amount (such reduction to be paid
from Collections). Such Reduction Notice shall designate (a) the date (the
"Proposed Reduction Date") upon which any such reduction of Aggregate Invested
Amount shall occur (which date shall give effect to the applicable Required
Notice Period), and (b) the amount of Aggregate Invested Amount to be reduced
which shall be applied ratably to all Receivable Interests in accordance with
the respective Invested Amounts thereof (the "Aggregate Reduction"). Only one
(1) Reduction Notice shall be outstanding at any time.
(b) Mandatory. If at any time before the Facility Termination Date any
condition in Section 6.2 is not fulfilled, Reinvestments shall cease and an
Aggregate Reduction shall commence, which shall cease only upon the Seller
confirming to the Agent that the conditions in Section 6.2 are fulfilled.
Section 1.4. Deemed Collections; Purchase Limit. (a) If on any day:
(i) the Outstanding Balance of any Receivable is reduced or canceled
as a result of any defective or rejected goods or services, any cash
discount or any other adjustment by the Originator or any Affiliate
thereof, or as a result of any governmental or regulatory action, or
(ii) the Outstanding Balance of any Receivable is reduced or
canceled as a result of a setoff in respect of any claim by the Obligor
thereof (whether such claim arises out of the same or a related or an
unrelated transaction), or
(iii) the Outstanding Balance of any Receivable is reduced on
account of the obligation of the Originator or any Affiliate thereof to
pay to the related Obligor any rebate or refund, or
(iv) the Outstanding Balance of any Receivable is less than the
amount included in calculating the Net Pool Balance for purposes of any
Investment Report (for any reason other than receipt of Collections or
such Receivable becoming a Defaulted Receivable), or
(v) any of the representations or warranties of the Seller set forth
in Section 5.1(g), Section 5.1(i), Section 5.1(j), Section 5.1(l),
Section 5.1(q), Section 5.1(r), Section 5.1(s), Section 5.1(t) or Section
5.1(u) were not true when made with respect to any Receivable,
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then, on such day, the Seller shall be deemed to have received a Collection of
such Receivable (A) in the case of clauses (i)-(iv) above, in the amount of
such reduction or cancellation or the difference between the actual
Outstanding Balance and the amount included in calculating such Net Pool
Balance, as applicable; and (B) in the case of clause (v) above, in the amount
of the Outstanding Balance of such Receivable and, in each case, not later
than two (2) Business Days thereafter shall pay to the Agent's Account the
amount of any such Collection deemed to have been received in the same manner
as actual cash collections.
(b) The Seller shall ensure that the Aggregate Invested Amount at no time
exceeds the Purchase Limit. If at any time the Aggregate Invested Amount
exceeds the Purchase Limit, the Seller shall immediately pay to the Agent an
amount to be applied to reduce the Aggregate Invested Amount (as allocated by
the Agent), such that after giving effect to such payment the Aggregate
Invested Amount is less than or equal to the Purchase Limit.
(c) The Seller shall also ensure that the Receivable Interests shall at
no time exceed in the aggregate 100%. If the aggregate of the Receivable
Interests exceeds 100%, the Seller shall pay to the Agent immediately an
amount to be applied to reduce the Aggregate Invested Amount (as allocated by
the Agent), such that after giving effect to such payment, the aggregate of
the Receivable Interests equals or is less than 100%.
Section 1.5. Payment Requirements and Computations. 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 12:00 noon (New York time) on the day when due in immediately
available funds, and if not received before 12:00 noon (New York time) shall
be deemed to be received on the next succeeding Business Day. If such amounts
are payable to the Agent for the account of any Purchaser, they shall be paid
to the Agent's Account, for the account of such Purchaser until otherwise
notified by the Agent. Upon notice to the Seller, the Agent may debit the
Facility Account for all amounts due and payable hereunder. All computations
of CP Costs, Yield, per annum fees calculated as part of any CP Costs, per
annum fees hereunder and per annum fees under the Fee Letter shall be made on
the basis of a year of 360 days for the actual number of days elapsed. If any
amount hereunder 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
SALES TO AND FROM THE CONDUIT; PAYMENTS AND COLLECTIONS
Section 2.1. Required Purchases from the Conduit. (a) The Conduit may, at
any time sell to the Committed Purchasers pursuant to the Transfer Agreement
any percentage designated by the Conduit of the Conduit's Invested Amount and
its related Conduit Settlement (each, a "Put").
(b) Any portion of the Conduit's Invested Amount and related Conduit
Settlement purchased by a Committed Purchaser shall be considered part of such
Purchaser's Invested Amount and related Conduit Settlement from the date of
the relevant Put. Immediately upon any purchase by the Committed Purchasers of
any portion of the Conduit's Invested Amount, the
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Seller shall pay to the Agent (for the ratable benefit of such Purchasers) an
amount equal to the sum of (i) the Assigned Conduit Settlement and (ii) all
unpaid CP Costs owed to the Conduit (whether or not then due) to the end of
each applicable Tranche Period to which any Invested Amount being Put has been
allocated, (iii) all accrued but unpaid fees (whether or not then due) payable
to the Conduit in connection herewith at the time of such purchase and (iv)
all accrued and unpaid costs, expenses and indemnities due to the Conduit from
the Seller in connection herewith.
(c) The proceeds from each Put received by the Conduit (other than
amounts described in clauses (iii) and (iv) of the last sentence of Section
2.1(b)), shall be transferred into the Special Transaction Subaccount and used
solely to pay that portion of the outstanding commercial paper of the Conduit
issued to fund or maintain the Invested Amount of the Conduit so transferred.
Until used to pay commercial paper, all proceeds of any Put pursuant to this
Section shall be invested in Permitted Investments. All earnings on such
Permitted Investments shall be promptly remitted to the Seller.
Section 2.2. Purchases by the Conduit. The Conduit may at any time
deliver to the Agent and each Committed Purchaser a notification of assignment
in substantially the form of Exhibit XVII. If the Conduit delivers such
notice, each Committed Purchaser shall sell to the Conduit and the Conduit
shall purchase in full from each Committed Purchaser, the Invested Amount of
the Committed Purchasers on the last day of the relevant Tranche Periods, at a
purchase price equal to such Invested Amount plus accrued and unpaid Yield
thereon. Any sale from any Committed Purchaser to the Conduit pursuant to this
Section 2.2 shall be without recourse, representation or warranty except for
the representation and warranty that the Invested Amount sold by such
Committed Purchaser is free and clear of any Adverse Claim created or granted
by such Committed Purchaser and that such Purchaser has not suffered an Event
of Bankruptcy.
Section 2.3. Payments of Recourse Obligations. The Seller hereby promises
to pay the following (collectively, the "Obligations"):
(a) all amounts due and owing under Section 1.3 or Section 1.4 on
the dates specified therein;
(b) the fees set forth in the Fee Letter on the dates specified
therein;
(c) all accrued and unpaid Yield on the Receivable Interests
accruing Yield at the Prime Rate or the Default Rate on each Settlement
Date applicable thereto;
(d) all accrued and unpaid Yield on the Receivable Interests
accruing Yield at the LIBO Rate on the last day of each Tranche Period
applicable thereto;
(e) all accrued and unpaid CP Costs on the Receivable Interests
funded with Commercial Paper on each Settlement Date; and
(f) all Broken Funding Costs and Indemnified Amounts upon demand.
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Section 2.4. Collections Prior to the Facility Termination Date. (a)
Prior to the Facility Termination Date, any Deemed Collections received by the
Servicer and all Collections received by the Servicer shall be set aside and
held in trust by the Servicer for the payment of any accrued and unpaid
Aggregate Unpaids or for a Reinvestment as provided in this Section 2.4. On
each day on which any of the conditions precedent set forth in Section 6.2 are
not satisfied, the Servicer shall set aside and hold in trust for the benefit
of the Secured Parties all Collections received on such day. If at any time
any Collections are received by the Servicer prior to the Facility Termination
Date, the Seller hereby requests and each Purchaser hereby agrees to make,
simultaneously with such receipt, a reinvestment (each, a "Reinvestment") with
the balance of each and every Collection received by the Servicer such that
after giving effect to such Reinvestment, the Invested Amount of such
Purchaser's Receivable Interest immediately after such receipt and
corresponding Reinvestment shall be equal to the amount of Invested Amount
immediately prior to such receipt; provided that no such Reinvestment shall be
made if the conditions precedent in Section 6.2 are not satisfied; provided,
further, that the Conduit shall not be required to make any such Reinvestments
if the Conduit has provided notice to the Agent, the Seller and the Collection
Agent (which notice has not been revoked in writing by the Conduit) that it no
longer will make Reinvestments (in which case the Conduit's Reinvestments, but
not those of the Committed Purchasers, shall cease).
(b) On each Settlement Date prior to the Facility Termination Date, the
Servicer shall remit to the Agent's Account the amounts required to be set
aside during the preceding Settlement Period and all amounts on deposit in the
Facility Account on such date that have not been subject to a Reinvestment and
apply such amounts (if not previously paid in accordance with Section 2.3) to
the Aggregate Unpaids in the order specified:
first, to all fees and other amounts due and payable to the Agent,
second, ratably to the Purchasers to the payment of all accrued and
unpaid CP Costs, Yield and Broken Funding Costs (if any) that are then
due and owing,
third, to the accrued and unpaid Subservicer Fee if and so long as
Finacity acts as sub-servicer pursuant to Section 8.1 hereof.
fourth, to the accrued and unpaid Servicing Fee (so long as the
Servicer is not Vitro America or an Affiliate of Vitro America),
fifth, ratably to the payment of all accrued and unpaid fees under
the Fee Letter (if any) that are then due and owing,
sixth, if required under Section 1.3 or Section 1.4, to the ratable
reduction of Aggregate Invested Amount,
seventh, for the ratable payment of all other unpaid Obligations, if
any, that are then due and owing,
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eighth, to the accrued and unpaid Servicing Fee (so long as the
Servicer is Vitro America or an Affiliate of Vitro America), and
ninth, the balance, if any, to the Seller or otherwise in accordance
with the Seller's instructions. Such amounts remitted to the Seller shall
be available for the ordinary business purposes of the Seller or
otherwise, subject to the provisions of the Transaction Documents.
Section 2.5. Application of Collections After the Facility Termination
Date. On the Facility Termination Date and on each day thereafter, the
Servicer shall set aside and hold in trust, for the benefit of the Secured
Parties and retain in the Facility Account all Collections received on each
such day. On and after the Facility Termination Date, the Servicer shall, on
each Settlement Date and on each other Business Day specified by the Agent:
(a) remit to the Agent's Account the amounts required to be set aside and
retained pursuant to the preceding sentence, and (b) apply such amounts to
reduce the Aggregate Unpaids as follows:
first, to the Agent until all amounts owed to the Agent have been
paid in full,
second, ratably to the Purchasers to the payment of all accrued and
unpaid CP Costs, Yield and Broken Funding Costs,
third, to the accrued and unpaid Subservicer Fee if and so long as
Finacity acts as sub-servicer pursuant to Section 8.1 hereof,
fourth, to the accrued and unpaid Servicing Fee (so long as the
Servicer is not Vitro America or an Affiliate of Vitro America),
fifth, ratably to the payment of all accrued and unpaid fees under
the Fee Letter,
sixth, to the ratable reduction of Aggregate Invested Amount,
seventh, for the ratable payment of all other Aggregate Unpaids,
eighth, to the accrued and unpaid Servicing Fee (so long as the
Servicer is Vitro America or an Affiliate of Vitro America),
ninth, to Finacity for the payment of any unpaid Breakage Fee, and
tenth, after the Final Payout Date, to the Seller
Section 2.6. 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. The 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
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amount thereof, plus interest thereon at the Default Rate from the date of any
such rescission, return or refunding.
Section 2.7. Clean Up Call; Reconveyance of Receivable Interests. (a) The
Servicer shall have the right (after providing written notice to the Agent in
accordance with the Required Notice Period), at any time following the
reduction of the Aggregate Invested Amount to a level that is less than 10.0%
of the original Purchase Limit, to purchase all, but not less than all, of the
then outstanding Receivable Interests (the "Clean Up Call"). The purchase
price in respect thereof shall be an amount equal to the Aggregate Unpaids
through the date of such purchase, payable in immediately available funds to
the Agent's Account. Such purchase shall be free and clear of any Adverse
Claim created by the Agent but otherwise shall be without representation,
warranty or recourse of any kind by, on the part of, or against the Secured
Parties or the Agent.
(b) Following the Final Payment Date, the Agent on behalf of the Secured
Parties shall be considered to have reconveyed free and clear of any Adverse
Claim created by the Agent (but otherwise shall be without representation,
warranty or recourse of any kind by, on the part of, or against the Secured
Parties or the Agent) to the Seller all of the Agent's (on behalf of the
Secured Parties) right, title and interest in, to and under the Receivables,
Related Security and Collections with respect thereto and shall at the
request, and sole cost and expense, of the Seller, execute and deliver to the
Seller, all such documents or instruments as are necessary to terminate the
Agent's interest on behalf of the Purchasers in the Receivables, Related
Security and Collections with respect thereto.
ARTICLE III
COMMERCIAL PAPER FUNDING
Section 3.1. CP Costs. The Seller shall pay CP Costs with respect to the
Invested Amount of all Receivable Interests held by the Conduit. The Agent
shall allocate the Invested Amount of the Conduit to Tranche Periods in its
sole discretion.
Section 3.2. Calculation of CP Costs. Not later than the third Business
Day immediately preceding each Monthly Reporting Date, the Conduit shall
calculate the aggregate amount of CP Costs applicable to its Receivable
Interests for the Calculation Period then most recently ended and shall notify
the Seller of such aggregate amount.
Section 3.3. CP Costs Payments. On each Settlement Date, the Seller shall
pay to the Agent (for the benefit of the Conduit) an aggregate amount equal to
all accrued and unpaid CP Costs in respect of the Invested Amount of all
Receivable Interests held by the Conduit for any portion of the Calculation
Period then most recently ended in accordance with Article II.
Section 3.4. Default Rate. From and after the occurrence of an
Amortization Event, all Receivable Interests funded through the issuance of
Commercial Paper shall accrue Yield at the Default Rate.
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ARTICLE IV
COMMITTED PURCHASER FUNDING
Section 4.1. Committed Purchaser Fundings. Prior to the occurrence of an
Amortization Event, the outstanding Invested Amount of each Receivable
Interest held by a Committed Purchaser 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 the Seller gives the required
notice to the Agent of another Yield Rate in accordance with Section 4.3, the
initial Yield Rate for any Invested Amount of a Committed Purchaser shall be
the Prime Rate (unless the Default Rate is then applicable). If any undivided
interest in a Receivable Interest initially funded by the Conduit is Put to
the Committed Purchasers pursuant to Section 2.1 hereof, such undivided
interest in such Receivable Interest shall be deemed to have a Tranche Period
commencing on the date of such sale.
Section 4.2. Yield Payments. On the Settlement Date for each Receivable
Interest that is held by the Committed Purchasers, the Seller shall pay to the
Agent (for the benefit of the Committed Purchasers) an aggregate amount equal
to the accrued and unpaid Yield thereon for the entire related Tranche Period
in accordance with Article II.
Section 4.3. Selection and Continuation of Tranche Periods. All of the
Invested Amount of the Committed Purchasers shall be allocated to one or more
Tranches reflecting the Yield Rates at which such Invested Amount accrues
Yield and the Tranche Periods for which such Yield Rates apply. In each
request for an Incremental Purchase from the Committed Purchasers and three
Business Days before the expiration of any Tranche Period applicable to any
Committed Purchaser's Investment, the Seller may request the Tranche Period(s)
to be applicable to such Investment and the Yield Rate(s) applicable thereto.
All of the Invested Amount of the Committed Purchasers may accrue Yield at
either the LIBO Rate or the Prime Rate, in all cases as established for each
Tranche Period applicable to such Invested Amount. Any Invested Amount of the
Committed Purchasers not allocated to a Tranche Period shall be a Prime
Tranche. During the pendency of an Amortization Event, the Agent may
reallocate any outstanding Invested Amount of the Committed Purchasers to a
Prime Tranche. All Yield accrued on the Invested Amount of the Committed
Purchasers during a Tranche Period shall be payable by the Seller on the last
day of such Tranche Period or, for a LIBO Rate Tranche with a Tranche Period
of more than three months, three months after the commencement, and on the
last day, of such Tranche Period. If, by the time required by this Section
4.3, the Seller fails to select a Yield Rate or Tranche Period for any
Invested Amount of the Committed Purchasers, such amount of Investment shall
automatically accrue Yield at the Prime Rate for a three-Business-Day Tranche
Period. Any Invested Amount purchased from the Conduit pursuant to the
Liquidity Agreement shall accrue interest at the Prime Rate and have an
initial Tranche Period of three Business Days.
Section 4.4. Suspension of the LIBO Rate. (a) If any Committed Purchaser
notifies the Agent that it has determined that funding its Invested Amount at
a 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
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match fund its Invested Amount at such LIBO Rate are not available or (ii)
such LIBO Rate does not accurately reflect the cost of acquiring or
maintaining its Invested Amount at such LIBO Rate, then the Agent shall
promptly notify the Seller Parties and the Agent shall suspend the
availability of such LIBO Rate and require the Seller to select the Prime Rate
for any Invested Amount accruing Yield at such LIBO Rate; provided, that
failure to so notify any Seller Party shall not result in the nonsuspension of
the availability of such LIBO Rate.
(b) If less than all of the Committed Purchasers give a notice to the
Agent pursuant to Section 4.4(a), each Committed Purchaser which gave such a
notice shall be obliged, at the request of the Seller, the Conduit or the
Agent, to assign all of its rights and obligations hereunder to (i) another
Committed Purchaser or (ii) another funding entity nominated by the Seller or
the Agent that is an Eligible Assignee willing to participate in this
Agreement through the Liquidity Termination Date in the place of such
notifying Committed Purchaser; provided, that (A) the notifying Committed
Purchaser receives payment in full of all Aggregate Unpaids owing to it
(whether due or accrued) and (B) the replacement Committed Purchaser otherwise
satisfies the requirements of this Agreement.
(c) Each Committed Purchaser agrees that, upon the occurrence of any
event giving rise to the operation of Section 4.4 with respect to such
Committed Purchaser, it will, if requested by the Seller, to the extent
permissible under applicable law, endeavor in good faith to change the funding
office at which it books its ratable share of any Invested Amount funded at a
LIBO Rate hereunder if such change would make it lawful for such Committed
Purchaser to fund such Invested Amount at a LIBO Rate; provided, however, that
such change may be made in such manner that such Committed Purchaser, in its
sole determination, suffers no unreimbursed cost or expense or any
disadvantage whatsoever.
Section 4.5. Default Rate. From and after the occurrence of an
Amortization Event, all Invested Amount of the Committed Purchasers shall
accrue Yield at the Default Rate.
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 each Purchaser,
as to itself, as of the date hereof and as of the date of each Incremental
Purchase and the date of each Reinvestment that:
(a) Existence and Power. Such Seller Party's jurisdiction of
organization is correctly set forth in Exhibit III to this Agreement.
Such Seller Party is duly organized under the laws of such jurisdiction
and is a "registered organization" as defined in the UCC in effect in
such jurisdiction. Such Seller Party is validly existing and in good
standing under the laws of its jurisdiction of organization. Such Seller
Party is duly qualified to do business and is in good standing as a
foreign entity, and has and holds all organizational power and all
governmental licenses, authorizations, consents and approvals required to
carry on its business in each jurisdiction in which its business is
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conducted except where the failure to do 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 the Seller, the Seller's use of the proceeds of Purchases made
hereunder are within its organizational powers and authority and have
been duly authorized by all necessary organizational 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 Organizational Documents, (ii) any law,
rule or regulation applicable to it, (iii) any restrictions under any
agreement, contract or instrument to which it is a party or by which it
or any of its property is bound, or (iv) any order, writ, judgment,
award, injunction or decree binding on or affecting it or its property,
and do not result in the creation or imposition of any Adverse Claim on
assets of such Seller Party or the assets of its Subsidiaries (except as
created hereunder) except, in any case, where such contravention or
violation could not reasonably be expected to have a Material Adverse
Effect; and no transaction contemplated hereby requires compliance with
any bulk sales act or similar law.
(d) Governmental Authorization. Other than the filing of the UCC
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, that could reasonably be
expected to have a Material Adverse Effect. Such Seller Party is not in
default with respect to any order of any court, arbitrator or
governmental body that could reasonably be expected to have a Material
Adverse Effect.
(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).
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(g) Accuracy of Information. All information (other than any
projections, forecasts or other forward-looking information) heretofore
furnished by such Seller Party or any of its Affiliates to the Agent or
any Purchaser (or any of their assigns) for purposes of or in connection
with this Agreement (including without limitation any Investment Report),
any of the other Transaction Documents or any transaction contemplated
hereby or thereby is, and all such information (other than any
projections, forecasts or other forward-looking information) hereafter
furnished by such Seller Party or any of its Affiliates to the Agent or
any Purchaser (or any of their assigns) will be, true, complete 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.
(h) Use of Proceeds. No proceeds of any Purchase hereunder will be
used (i) for a purpose that violates (A) Section 7.2(e) of this Agreement
or (B) 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. The Seller owns and has legal and equitable title to
the Purchased Assets free and clear of any Adverse Claim, except as
created by the Transaction Documents.
(j) Perfection. (i) This Agreement creates a valid and continuing
security interest (as defined in the UCC) in the Purchased Assets in
favor of Agent for the benefit of the Secured Parties, which security
interest is prior to all other Adverse Claims and is enforceable as such
as against creditors and purchasers from the Seller.
(ii) All actions necessary under the UCC (or any comparable law) of
all appropriate jurisdictions have been taken including, without
limitation, the execution of the Collection Account Agreements and the
filing of UCC financing statements or other similar instruments or
documents necessary under the UCC (or any comparable law) of all
appropriate jurisdictions to perfect (A) the Seller's security interest
in each Receivable, its Collections and the Related Security and (B) the
Agent's (on behalf of the Secured Parties) security interest in the
Purchased Assets.
(iii) Other than the security interest granted to Agent for the
benefit of the Secured Parties pursuant to this Agreement and security
interests that have been terminated or become ineffective on or prior to
the date hereof, the Seller has not pledged, assigned, sold, granted a
security interest in, or otherwise conveyed any of the Purchased Assets.
(iv) The Seller has not authorized the filing of and is not aware of
any financing statements against the Seller that include a description of
collateral covering the Purchased Assets other than any financing
statement relating to the security interest granted to Agent for the
benefit of the Secured Parties hereunder or that has been terminated or
otherwise becomes ineffective on or prior to the date hereof. The Seller
is not aware of any judgment or tax lien filings against the Seller.
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(v) Each Receivable constitutes an "account" within the meaning of
the UCC.
(k) Places of Business and Locations of Records. The jurisdiction of
organization, principal places of business 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 attached hereto 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
13.3(a) has been taken and completed. The Seller's Federal Employer
Identification Number is correctly set forth on Exhibit III attached
hereto.
(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 the Seller at each
Collection Bank and the post office box number of each Lock-Box, are
listed on Exhibit IV attached hereto. The Seller has not granted any
Person, other than the Agent (and its assigns) as contemplated by this
Agreement, dominion and control of any Lock-Box or Collection Account, or
the right to take dominion and control of any such Lock-Box or Collection
Account at a future time or upon the occurrence of a future event.
(m) Material Adverse Effect. Since December 31, 2003, no event has
occurred that would have a Material Adverse Effect.
(n) Names. The name in which the Seller has executed this Agreement
is identical to the name of the Seller as indicated on the public record
of its jurisdiction of organization which shows the Seller to have been
organized. In the past five (5) years, the Seller has not used any
organizational names, trade names or assumed names other than the name in
which it has executed this Agreement and as listed on Exhibit III
attached hereto.
(o) Ownership of the Seller. Vitro America owns, directly or
indirectly, 100% of the issued and outstanding equity interests of the
Seller, free and clear of any Adverse Claim. Such equity interests are
validly issued, fully paid and nonassessable, and there are no options,
warrants or other rights to acquire securities of the 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. Each Receivable, together with the
Contract related thereto, does not contravene any laws, rules or
regulations
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applicable thereto (including, without limitation, laws, rules and
regulations relating to truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection
practices and privacy), and no part of such Contract is in violation of
any such law, rule or regulation, except where such contravention or
violation could not reasonably be expected to have a Material Adverse
Effect.
(r) Compliance with Credit and Collection Policy. Such Seller Party
has complied in all material respects with the Credit and Collection
Policy with regard to each Receivable and the related Contract, and has
not made any change to such Credit and Collection Policy, except such
change as to which the Agent has been notified in accordance with Section
7.1(a)(vii).
(s) Payments to the Originator. With respect to each Receivable
transferred to the Seller under the Receivables Sale Agreement, the
Seller has given reasonably equivalent value to the Originator in
consideration therefor and such transfer was not made for or on account
of an antecedent debt. No transfer by the 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. ▇▇.▇▇. 101 et
seq.), as amended.
(t) Enforceability of Contracts. 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,
enforceable against the Obligor in accordance with its terms, except as
such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or limiting creditors'
rights generally and by general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law).
(u) Eligible Receivables. Each Receivable included in the Net Pool
Balance as an Eligible Receivable on the date of any Investment Report
was an Eligible Receivable on such date.
(v) Purchase Limit and Maximum Receivable Interests. Immediately
after giving effect to each Incremental Purchase hereunder, the Aggregate
Invested Amount is less than or equal to the Purchase Limit and the
aggregate of the Receivable Interests does not exceed 100%.
(w) Accounting. Such Seller Party will account for the transactions
contemplated by the Receivables Sale Agreement as true sales.
ARTICLE VI
CONDITIONS OF PURCHASES
Section 6.1. Conditions Precedent to Initial Incremental Purchase. The
initial Incremental Purchase of a Receivable Interest under this Agreement is
subject to the conditions
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precedent that (a) the Agent shall have received on or before the Closing Date
those documents listed on Schedule A and (b) the Agent shall have received all
fees and expenses required to be paid on such date pursuant to the terms of
this Agreement and the Fee Letter.
Section 6.2. Conditions Precedent to All Purchases and Reinvestments.
Each Incremental Purchase and each Reinvestment shall be subject to the
further conditions precedent that (a) in the case of each such Purchase the
Servicer shall have delivered to the Agent on or prior to the date of such
Purchase, in form and substance satisfactory to the Agent, all Investment
Reports as and when due under Section 8.5, (b) the Agent shall have received
such other approvals, opinions or documents as it may reasonably request and
(c) on each Purchase Date, 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 the 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 Purchase Date, except to
the extent such representations and warranties are expressly limited to
an earlier 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 an Unmatured Amortization Event;
(iii) the Net Pool Balance is greater than or equal to the sum of
(x) the Aggregate Invested Amount plus (y) the Required Reserve at such
time and after giving effect to such Incremental Purchase and
Reinvestment, as applicable; and
(iv) the Aggregate Invested Amount does not exceed the Purchase
Limit and the aggregate Receivable Interests do not exceed 100%.
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 the Seller to satisfy any of the foregoing conditions precedent in
respect of such Reinvestment.
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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, 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 will furnish or cause to be
furnished to the Agent (or its assigns):
(i) Annual Reporting. As soon as available and in any event
within one hundred twenty (120) days after the end of each of its
respective fiscal years, (A) the audited balance sheet and the
related audited consolidated statements of income and cash flows for
each of the Performance Guarantor and the Servicer and its
respective consolidated Subsidiaries as at the end of such fiscal
year, setting forth in each case in comparative form the figures for
such fiscal year, all reported in conformity with GAAP, with the
unqualified opinion of (1) in the case of the Performance Guarantor,
the Mexican office of Deloitte & Touche or other independent public
accountants of recognized international standing and (2) in the case
of the Servicer, independent public accountants of recognized
international standing and (B) the balance sheet, statements of
income and cash flows of the Seller as at the end of such fiscal
year certified by its chief financial officer.
(ii) Quarterly Reporting. As soon as available and in any event
within sixty (60) days after the end of each quarter of each of its
respective fiscal years, (A) the unaudited consolidated balance
sheet of the Servicer and the Performance Guarantor and the related
unaudited consolidated statements of income and cash flows of such
Person and its consolidated Subsidiaries for such quarter and for
the period from the beginning of the then current fiscal year to the
end of such quarter, setting forth in each case in comparative form
the figures for the corresponding quarter in the previous fiscal
year, all certified as to the fairness of presentation and
conformity with GAAP by an Authorized Officer of such Person and (B)
the unaudited balance sheet of the Seller and the related unaudited
statements of income and cash flow of the Seller for such quarter
and for the period from the beginning of the then current fiscal
year to the end of such quarter, setting forth in each case in
comparative form the figures for the corresponding quarter in the
previous fiscal year, all certified as to the fairness of
presentation and conformity with GAAP by an Authorized Officer of
the Seller.
(iii) Compliance Certificate. Together with the financial
statements required hereunder, a compliance certificate in
substantially the form of Exhibit V attached hereto, 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 such Seller Party, 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 such Seller Party or any of its Affiliates
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 or any
Purchaser, copies of the same.
(vii) Change in Credit and Collection Policy. At least thirty
(30) days prior to the effectiveness of any change in or 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 consent thereto.
(viii) Other Information. Promptly, from time to time, such
other information, documents, records or reports relating to the
Receivables or the financial condition or results of operations of
such Seller Party as the Agent (or its assigns) may from time to
time reasonably request in order to protect the interests of the
Agent (and its assigns), for the benefit of the Purchasers, under or
as contemplated by this Agreement.
(b) Notices. Such Seller Party will notify the Agent (or its
assigns) 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 Unmatured Amortization Events. The
occurrence of each Amortization Event and each Unmatured
Amortization Event, by a statement of an Authorized Officer of such
Seller Party.
(ii) Judgments and Proceedings. (A) (1) The entry of any
judgment or decree against Performance Guarantor, the Servicer or
any of their respective Subsidiaries if the aggregate amount of all
judgments and decrees then outstanding against Performance
Guarantor, the Servicer and their respective Subsidiaries exceeds
$10,000,000 in the case of the Performance Guarantor and any of its
Subsidiaries or exceeds $1,000,000 in the case of the Servicer and
any of its Subsidiaries after deducting (I) the amount with respect
to which Performance Guarantor, the Servicer or any such Subsidiary,
as the case may be, is insured and with respect to which the insurer
has assumed responsibility in
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writing, and (II) the amount for which Performance Guarantor, the
Servicer or any such Subsidiary is otherwise indemnified if the
terms of such indemnification are reasonably satisfactory to the
Agent (or its assigns), and (2) the institution of any litigation,
arbitration proceeding or governmental proceeding against
Performance Guarantor or the Servicer which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse
Effect; and (B) the entry of any judgment or decree or the
institution of any litigation, arbitration proceeding or
governmental proceeding against the 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) Notices under Receivables Sale Agreement. Copies of all
notices delivered under the Receivables Sale Agreement.
(vii) ERISA Events. The occurrence of any ERISA Event.
(viii) Downgrade of Servicer or Performance Guarantor. If
Indebtedness of the Servicer or the Performance Guarantor, as the
case may be, shall be rated by any Rating Agency, any downgrade in,
or withdrawal of, the rating of any Indebtedness of the Servicer or
the Performance Guarantor, as the case may be, by such Rating
Agency, setting forth the Indebtedness affected and the nature of
such change.
(c) Compliance with Laws and Preservation of 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 so comply could not reasonably be expected to have a
Material Adverse Effect. Such Seller Party will preserve and maintain
its legal existence, rights, franchises and privileges in its
jurisdiction of organization, and qualify and remain qualified in
good standing as a foreign entity in each organization where its
business is conducted, except where the failure to so preserve and
maintain or qualify could not reasonably be expected to have a
Material Adverse Effect.
(d) Audits. Such Seller Party will furnish to the Agent (or its
assigns) from time to time such information with respect to it and the
Receivables as the Agent (or its assigns) may reasonably request. Such
Seller Party will, from time to time during regular business hours as
requested by the Agent (or its assigns) upon reasonable notice and at the
sole cost of such Seller Party, permit the Agent (or its assigns), or
their respective
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agents or representatives (and shall cause the Originator to permit the
Agent (or its assigns) or their respective agents or representatives):
(i) to examine and make copies of and abstracts from all Records in the
possession or under the control of such Person relating to the Purchased
Assets, including, without limitation, the related Contracts, and (ii) to
visit the offices and properties of such Person for the purpose of
examining such materials described in clause (i) above, and to discuss
matters relating to such Person's financial condition or the Purchased
Assets or any Person's performance under any of the Transaction Documents
or any Person's performance under the Contracts and, in each case, with
any of the officers or employees of the Seller or the Servicer having
knowledge of such matters (each of the foregoing examinations and visits,
a "Review"); provided, however, that, if an Unmatured Amortization Event
or Amortization Event shall have occurred and be continuing then such
Seller Party shall, and shall cause the Originator to, permit the Agent
(or its assigns) or to conduct a Review at any time and without advance
notice.
(e) Keeping and Marking of Records and Books. (i) The Servicer will
(and will cause the Originator to) maintain and implement administrative
and operating procedures (including, without limitation, an ability to
recreate records evidencing Receivables in the event of the destruction
of the originals thereof), and keep and maintain all documents, books,
records and other information reasonably necessary or advisable for the
collection of all Receivables (including, without limitation, records
adequate to permit the immediate identification of each new Receivable
and all Collections of and adjustments to each existing Receivable). The
Servicer will (and will cause the Originator to) give the Agent (or its
assigns) notice of any material change in the administrative and
operating procedures referred to in the previous sentence.
(ii) Such Seller Party will (and will cause the Originator to): (A)
on or prior to the date hereof, ▇▇▇▇ its master data processing records
and other books and records relating to the Receivables with a legend,
reasonably acceptable to the Agent (or its assigns), describing the
security interest of the Agent (for the benefit of the Secured Parties)
in the Purchased Assets and (B) upon the request of the Agent (or its
assigns) following the occurrence of an Amortization Event: (1) ▇▇▇▇ each
Contract with a legend describing the Agent's security interest and (2)
assemble and make available to the Agent at its sole expense all
Contracts (including, without limitation, all multiple originals of any
such Contract constituting an instrument, a certificated security or
chattel paper) relating to the Receivables.
(f) Compliance with Contracts and Credit and Collection Policy. Such
Seller Party will (and will require the Originator to) timely and fully
(i) perform and comply with all provisions, covenants and other promises
required to be observed by it under the Contracts related to the
Receivables, and (ii) comply in all material respects with the Credit and
Collection Policy in regard to each Receivable and the related Contract.
(g) Performance and Enforcement of Receivables Sale Agreement. The
Seller will, and will require the Originator to, perform its obligations
and undertakings under and pursuant to the Receivables Sale Agreement,
will purchase Receivables thereunder in
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strict compliance with the terms thereof and will vigorously enforce the
rights and remedies accorded to the Seller under the Receivables Sale
Agreement. The Seller will take all actions to perfect and enforce its
rights and interests (and the rights and interests of the Agent, as the
Seller's assignee) under the Receivables Sale Agreement as the Agent (or
its assigns) 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. The Seller will (or will require the Originator to)
take all necessary action to (i) vest legal and equitable title to the
Purchased Assets purchased under the Receivables Sale Agreement
irrevocably in the Seller, free and clear of any Adverse Claims (other
than Adverse Claims in favor of the Agent, for the benefit of the Secured
Parties) 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 Seller's interest in such Purchased Assets and such other action to
perfect, protect or more fully evidence the interest of the Seller
therein as the Agent may reasonably request), and (ii) establish and
maintain, in favor of the Agent, for the benefit of the Secured Parties,
a valid and perfected first priority security interest in all Purchased
Assets, free and clear of any Adverse Claims, 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 Secured Parties) security interest in the Purchased Assets and
such other action to perfect, protect or more fully evidence the interest
of the Agent (for the benefit of the Secured Parties) as the Agent (or
its assigns) may reasonably request.
(i) Reliance. The Seller acknowledges that the Agent and the
Purchasers are entering into the transactions contemplated by this
Agreement in reliance upon the Seller's identity as a legal entity that
is separate from the Originator. Therefore, from and after the date of
execution and delivery of this Agreement, the 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
the Seller's identity as a separate legal entity and to make it manifest
to third parties that the Seller is an entity with assets and liabilities
distinct from those of the Originator and any Affiliates thereof (other
than the Seller) and not just a division of the Originator or any such
Affiliate. Without limiting the generality of the foregoing and in
addition to the other covenants set forth herein, the Seller will:
(i) hold itself out as a separate entity, conduct its own
business in its own name and require that all full-time employees of
the Seller, if any, identify themselves as such and not as employees
of the Originator (including, without limitation, by means of
providing appropriate employees with business or identification
cards identifying such employees as the Seller's employees) and
correct any known misunderstanding regarding its status as a
separate entity;
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(ii) maintain a sufficient number of employees in light of its
contemplated business operations and compensate all employees,
consultants and agents directly, from the Seller's own funds, for
services provided to the Seller by such employees, consultants and
agents and, to the extent any employee, consultant or agent of the
Seller is also an employee, consultant or agent of the Originator or
any Affiliate thereof, allocate the compensation of such employee,
consultant or agent between the Seller and such Originator or such
Affiliate, as applicable, on a basis that reflects the services
rendered to the Seller and such Originator or such Affiliate, as
applicable;
(iii) clearly identify its offices (by signage or otherwise) as
its offices and, if such office is located in the offices of the
Originator, the Seller shall lease such office at a fair market
rent;
(iv) have a separate telephone number, which will be answered
only in its name and separate stationery, invoices and checks in its
own name;
(v) conduct all transactions with the Originator and the
Servicer (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 the Seller and the Originator 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;
(vi) at all times have a Board of Directors consisting of at
least three (3) members, at least two (2) members of which are
Independent Directors;
(vii) observe all organizational formalities as a distinct
entity, and ensure that all organizational actions relating to (A)
the selection, maintenance or replacement of the Independent
Directors, (B) the dissolution or liquidation of the Seller or (C)
the initiation of, participation in, acquiescence in or consent to
any bankruptcy, insolvency, reorganization or similar proceeding
involving the Seller, are duly authorized by unanimous vote of its
members (including the Independent Directors);
(viii) maintain the Seller's accounts and books and records
separate from those of any other Person or entity thereof and
otherwise readily identifiable as its own assets rather than assets
of any other Person or entity;
(ix) prepare its financial statements separately from those of
the Originator and insure that any consolidated financial statements
of the Originator or any Affiliate thereof that include the Seller
and that are filed with the Securities and Exchange Commission or
any other governmental agency have notes clearly stating that the
Seller is a separate legal entity and that its assets will be
available first and foremost to satisfy the claims of the creditors
of the Seller;
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(x) except as herein specifically otherwise provided, maintain
the funds or other assets of the Seller separate from, and not
commingled with, those of the Originator or any Affiliate thereof
and only maintain bank accounts or other depository accounts to
which the Seller alone is the account party, into which the Seller
alone makes deposits and from which the Seller alone (or the Agent
hereunder) has the power to make withdrawals;
(xi) pay all of the Seller's operating expenses and other
liabilities from the Seller's own assets (except for certain
payments by the Originator or other Persons pursuant to allocation
arrangements that comply with the requirements of this Section
7.1(i));
(xii) 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, the other Transaction Documents
and its Organizational Documents;
(xiii) maintain its Organizational Documents in conformity with
this Agreement, such that it does not amend, restate, supplement or
otherwise modify its Organizational Documents in any respect that
would impair its ability to comply with the terms or provisions of
any of the Transaction Documents, including, without limitation,
this Section 7.1(i);
(xiv) maintain its organizational 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.
(xv) maintain at all times the Required Capital Amount,
including, without limitation in this regard the requirements of
Section 7.2(g); and
(xvi) take such other actions as are necessary on its part to
ensure that the facts and assumptions set forth in the opinion
issued by Cravath, Swaine & ▇▇▇▇▇ LLP as counsel for the Seller, in
connection with the closing or initial Purchase under this 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. (i) Such Seller Party will cause (A) all cash,
checks, money orders or other proceeds of the Receivables or other
Purchased Assets received by it, in the form so received (with all
necessary endorsements), not later than the close of business on the
first Business Day following the date of receipt thereof to be deposited
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into a Depository Account or Lock-Box, (B) all proceeds of the
Receivables or other Purchased Assets received in any Depositary Account
or Lock-Box to be transferred to the Concentration Account, on each
Business Day in same day funds, (C) each Collection Bank maintaining each
Concentration Account to deposit on each Business Day in same day funds,
all available funds in each Concentration Account to the Facility Account
and (D) each Concentration Account, Bank of America Depositary Account
and the Facility Account to be subject at all times to a Collection
Account Agreement that is in full force and effect. At all times prior to
the remittance of Collections to a Collection Account in accordance
herewith, the Seller and/or the Servicer, as the case may be, will itself
hold or, if applicable, will cause all such payments to be held in trust
for the exclusive benefit of the Agent and the Secured Parties. The
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 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 (or its assigns) as
contemplated by this Agreement.
(ii) Seller, or Servicer on behalf of the Seller, shall cause
evidence to be delivered to Agent showing that the each Concentration
Account and the Facility Account are maintained in the name of the Seller
on the Closing Date.
(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, except any such taxes which are
not yet delinquent or are being diligently contested in good faith by
appropriate proceedings and for which adequate reserves in accordance
with GAAP shall have been set aside on its books. The 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 the Agent or any
Purchaser.
(l) Payment to Applicable Originator. With respect to any Receivable
purchased by the Seller from the 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 such Originator in respect of
the purchase price for such Receivable.
(m) Maintenance of Agreements. The Seller shall maintain the
effectiveness of, and continue to perform under the Receivables Sale
Agreement and the Performance Undertaking, such that it does not amend,
restate, supplement, cancel, terminate or otherwise modify the
Receivables Sale Agreement or the Performance Undertaking, or give any
consent, waiver, directive or approval thereunder or waive any default,
action, omission or breach under the Receivables Sale Agreement or the
Performance Undertaking or otherwise grant any indulgence thereunder,
without (in each case) the prior written consent of the Agent.
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Section 7.2. Negative Covenants of the Seller Parties. Until the date on
which the Aggregate Unpaids have been paid in full and this Agreement
terminates in accordance with its terms, such Seller Party hereby covenants,
as to itself, that:
(a) Change in Name, Jurisdiction of Organization, Offices and
Records. Such Seller Party will not change (i) its name as it appears in
official filings in the jurisdiction of its organization, (ii) its status
as a "registered organization" (within the meaning of Article 9 of any
applicable enactment of the UCC), (iii) its organizational identification
number, if any, issued by its jurisdiction of organization, or (iv) its
jurisdiction of organization unless it shall have: (A) given the Agent at
least ten (10) days' prior written notice thereof; (B) at least ten (10)
days prior to such change, delivered to the Agent all financing
statements, instruments and other documents requested by the Agent in
connection with such change or relocation and (C) caused an opinion of
counsel acceptable to Agent and its assigns to be delivered to Agent and
its assigns that Agent's security interest (for the benefit of the
Secured Parties) is perfected and of first priority, such opinion to be
in form and substance acceptable to Agent and its assigns in their sole
discretion.
(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 regarding payments if such
new instructions require such Obligor to make payments to another
existing Collection Account.
(c) Modifications to Contracts and Credit and Collection Policy.
Such Seller Party will not, and will not permit the Originator to, make
any change to the Credit and Collection Policy unless, at least 30 days
prior to such change or amendment, it has delivered to the Agent a copy
of the Credit and Collection Policy then in effect and a notice (i)
indicating such proposed change or amendment and (ii) 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 consent thereto and in
connection therewith, prior to such proposed change or amendment such
Seller Party has received the Agent's consent thereto. Except as provided
in Section 8.2(d), the Servicer will not, and will not permit the
Originator to, extend, amend or otherwise modify the terms of any
Receivable or any Contract related thereto other than in accordance with
the Credit and Collection Policy.
(d) Sales, Adverse Claims. The 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
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financing statement) or with respect to, any of the Purchased Assets, or
assign any right to receive income with respect thereto (other than, in
each case, the creation of a security interest therein in favor of the
Agent as provided for herein), and the Seller will defend the right,
title and interest of the Agent (for the benefit of the Secured Parties)
in, to and under any of the foregoing property, against all claims of
third parties claiming through or under the Seller or the Originator. The
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) Use of Proceeds. The Seller will not use the proceeds of the
Purchases for any purpose other than (i) paying for Receivables and
Related Security under and in accordance with the Receivables Sale
Agreement, including without limitation, making payments on the
Subordinated Notes to the extent permitted thereunder and under the
Receivables Sale Agreement, (ii) paying its ordinary and necessary
operating expenses when and as due, and (iii) making Restricted Junior
Payments to the extent permitted under this Agreement.
(f) Termination Date Determination. The Seller will not designate
the Termination Date, or send any written notice to the 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. The Seller will not make any
Restricted Junior Payment if, after giving effect thereto, the Seller's
Net Worth would be less than the Required Capital Amount.
(h) The Seller Indebtedness. The Seller will not incur or permit to
exist any Indebtedness or liability on account of deposits except: (i)
the Aggregate Unpaids, (ii) the Subordinated Loans, and (iii) other
current accounts payable arising in the ordinary course of business and
not overdue, (iv) the endorsement of negotiable instruments for deposit
or collection or similar transactions in the ordinary course of business,
(v) the incurrence of obligations under this Agreement, (vi) the
incurrence of obligations, as expressly contemplated in the Receivables
Sale Agreement, to make payment to the Originator thereunder for the
purchase of Receivables from such Originator under the Receivables Sale
Agreement, and (vii) the incurrence of operating expenses in the ordinary
course of business of the type otherwise contemplated by this Agreement.
The Seller shall not hold out its credit as available to satisfy the
obligations of others, pledge its assets for the benefit of any other
entity, make loans or advances to any other entity or acquire obligations
or securities of its shareholders.
(i) Prohibition on Additional Negative Pledges. No Seller Party will
enter into or assume any agreement (other than this Agreement and the
other Transaction Documents) prohibiting the creation or assumption of
any Adverse Claim upon the Purchased Assets except as contemplated by the
Transaction Documents, or otherwise prohibiting or restricting any
transaction contemplated hereby or by the other Transaction
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Documents, and no Seller Party will enter into or assume any agreement
creating any Adverse Claim upon the Subordinated Notes.
Section 7.3. Post-Office Boxes and Depositary Accounts. (a) The parties
hereto acknowledge that certain Collections may be remitted by Obligors
directly to Vitro America (at a field office or otherwise) or to any
Post-Office Box. Vitro America agrees that it will instruct each of its
employees that is responsible for receiving any Collections that Vitro America
and such employee (i) are acting as servicer for the Seller, (ii) owe a duty
of due care to the Seller in all of their actions relating to the handling and
deposit of such Collections and (iii) are liable to the Seller for breaches of
such duty of due care.
(b) The Seller Parties hereby agree that each Post-Office Box shall be
maintained in the name of the Seller. Within 45 days after the Closing Date,
the Seller shall, and shall require the Originator to, execute a Postal
Direction Letter with respect to each Post-Office Box and the Seller shall,
and shall require the Originator to, execute a Postal Power of Attorney in
favor of the Agent for the benefit of the Secured Parties for each Post-Office
Box. No Seller Party shall, nor permit the Originator to, establish new
Post-Office Boxes without delivering to the Agent a Postal Power of Attorney
and a Postal Direction Letter with respect thereto and a revised Exhibit XVI.
(c) On the Closing Date, the Seller shall provide to the Agent evidence
that each of the Bank of America Depositary Accounts and the Selected
Depositary Accounts is maintained in the name of the Seller and execute (and,
if applicable, require the Originator to execute) such documents as may be
requested by the Agent in order to facilitate the transfer of Collections to,
and the retention of such Collections in, the Concentration Accounts. No
Seller Party shall, nor shall such Seller Party permit the Originator to,
establish new Depositary Accounts into which Collections are deposited unless
such account is (i) in the name of the Seller and (ii) either (A) an account
maintained with Bank of America, National Association which is automatically
swept to a Concentration Account on a daily basis or (B) an account with
respect to which NDC has been instructed to direct funds to be swept into a
Concentration Account on a daily basis.
(d) Without the prior written consent of the Agent, no Seller Party
shall, nor shall any Seller Party permit the Originator to, change any sweep
instructions given to Bank of America or NDC.
(e) No Seller Party shall, nor shall such Seller Party permit the
Originator to, engage any Person other than NDC to give instructions with
respect to bank accounts (other than accounts maintained with Bank of America)
into which Collections are deposited without the prior written consent of the
Agent; provided that any successor to NDC shall agree to comply with the
provisions of this Agreement and the other Transaction Documents with respect
to the handling of Collections.
ARTICLE VIII
ADMINISTRATION AND COLLECTION
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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. The Seller and the Agent, on behalf of the Secured Parties, hereby
appoints Vitro America as Servicer hereunder and Vitro America hereby accepts
such appointment and agrees to perform the duties and obligations of, the
Servicer pursuant to the terms of this Agreement. Upon written notice to the
Servicer, the Agent may designate as Servicer upon the occurrence of an
Amortization Event (other than one arising as a result of a Voluntary
Termination, unless another Amortization Event occurs) any Person to succeed
Vitro America or any successor Servicer.
(b) The Agent hereby acknowledges that the Servicer has delegated to
Finacity, as sub-servicer of the Servicer, certain of its duties and
responsibilities as Servicer hereunder in respect of the Receivables pursuant
to the terms of the Subservicing Agreement. Without the prior written consent
of the Agent, the Conduit and the Required Committed Purchasers, the Servicer
shall not be permitted to delegate any of its duties or responsibilities as
Servicer to any Person other than Finacity. Finacity shall not be permitted to
further delegate to any other Person any of the duties or responsibilities of
the Servicer delegated to it by the Servicer. If at any time the Agent shall
designate a successor Servicer, all duties and responsibilities theretofore
delegated by the then Servicer to Finacity may, at the discretion of the
Agent, be terminated forthwith on notice given by the Agent to Finacity.
(c) Notwithstanding the foregoing subsection (b): (i) The Servicer shall
be and remain primarily liable to the Agent and the Secured Parties for the
full and prompt performance of all duties and responsibilities of the Servicer
hereunder and (ii) the Agent and the Purchasers shall be entitled to deal
exclusively with the Servicer 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 the Servicer in order for communication to the
Servicer and its subservicer or other delegates with respect thereto to be
accomplished. 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. The Servicer shall perform those other
services which the Servicer is required to perform as set forth in the
Subservicing Agreement.
(b) The Servicer shall effect a Collection Account Agreement with each
bank party to a Collection Account at any time; provided, however, that, with
respect to the Ozaukee Bank account, the Servicer shall deliver a Collection
Account Agreement for such account satisfactory to the Agent within 15 days of
the Closing Date. 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
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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, the 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.
(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 the Seller and the Agent, on behalf of
the Purchasers, their respective shares of the Collections in accordance with
Article II. The Servicer shall retain in the Facility Account or otherwise
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 the Seller prior to the remittance thereof in
accordance with Article II. The Servicer shall segregate and deposit all
Collections in the Facility Account no later than the second Business Day
following receipt by the Seller or the Servicer of such Collections and cause
all checks, instruments and other non-cash forms of payment to be duly
endorsed or with duly executed instruments of transfer; provided, however,
that from and after the occurrence of an Amortization Event, the Agent may
notify the Servicer that such Collections shall be segregated and deposited in
the Facility Account immediately upon the Servicer's receipt thereof.
(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 Defaulted Receivable or limit the rights of the Agent or the
Secured Parties under this Agreement. Notwithstanding anything to the contrary
contained herein, after the occurrence of an Amortization Event, the Agent
shall have the absolute and unlimited right to direct the Servicer 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 the Seller and the Agent and the
Secured Parties 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 the Seller any cash collections or
other cash proceeds in accordance with Article II. The Servicer shall, from
time to time at the request of the Agent or any Purchaser, furnish to the
Agent (promptly after any such request) a calculation of the amounts set aside
pursuant to Article II.
(f) Any payment by an Obligor in respect of any indebtedness owed by it
to the Originator or the 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.
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Section 8.3. Collection Notices. The Agent is authorized at any time to
date and to deliver to the Collection Banks the Collection Notices. The Seller
hereby transfers to the Agent for the benefit of the Secured Parties, the
exclusive ownership and control of each Lock-Box and the Collection Accounts.
In case any authorized signatory of the 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. The Seller hereby authorizes the
Agent, and agrees that the Agent shall be entitled (a) at any time after
delivery of the Collection Notices, to endorse the Seller's name on checks and
other instruments representing Collections, (b) at any time after the
occurrence of an Amortization Event, to enforce the Receivables, the related
Contracts and the Related Security, and (c) at any time after the occurrence
of an Amortization Event, to 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 the Seller.
Section 8.4. Responsibilities of the Seller. Anything herein to the
contrary notwithstanding, the exercise by the Agent, on behalf of the Secured
Parties, of the Agent's rights hereunder shall not release the Servicer, the
Originator or the Seller from any of their duties or obligations with respect
to any Receivables or under the related Contracts. Neither the Agent nor any
of the Secured Parties shall have any obligation or liability with respect to
any Receivables or related Contracts, nor shall any of them be obligated to
perform the obligations of the Seller or the Originator thereunder.
Section 8.5. Investment Reports. The Servicer shall prepare and forward
to the Agent and to the financial institution then maintaining the Facility
Account (a) on each Business Day, a Daily Report for the immediately preceding
Business Day, (b) on each Weekly Reporting Date, a Weekly Report and an
electronic file of the data contained therein, (c) on each Monthly Reporting
Date, a Monthly Report and an electronic file of the data contained therein
and (d) at such times as the Agent shall request, a listing by Obligor of all
Receivables together with an aging of such Receivables; provided, however, if
an Unmatured Amortization Event or an Amortization Event shall have occurred
and be continuing, then an Investment Report shall be delivered for such
periods and as frequently as the Agent shall request.
Section 8.6. Servicing Fee. As compensation for the Servicer's servicing
activities on their behalf, the Servicer shall be paid the Servicing Fee in
arrears on each Settlement Date out of Collections in accordance with Sections
2.4 and 2.5.
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 of the Seller Parties or Performance Guarantor shall fail
(i) to make any payment or deposit required to be made by it under the
Transaction Documents when due and, for any such payment or deposit which
is not in respect of any portion of the
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Aggregate Invested Amount, such failure continues for one (1) Business
Day, or (ii) to perform or observe any other covenant or agreement under
any Transaction Documents (other than as described in clause (i) above or
paragraph (c) below) and such failure shall continue for ten (10)
consecutive Business Days.
(b) Any representation, warranty, certification or statement made by
Performance Guarantor or any of the Seller Parties 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; provided, that no such event shall constitute an Amortization Event
unless such event is unremedied for a period of ten (10) days after the
earlier to occur of (i) written notice thereof shall have been given by
the Agent to such Seller Party or (ii) an Authorized Officer of such
Seller Party shall have actual knowledge thereof or should have had
knowledge thereof if such Authorized Officer had exercised reasonable
care in the performance of his or her duties; provided, further, that no
grace period shall apply to Section 5.1(f), 5.1(i), 5.1(j), 5.1(n),
5.1(p), 5.1(u) or 5.1(v); and provided, further, no such event shall
constitute an Amortization Event if the Seller shall have timely paid to
the Agent the Deemed Collection required to be paid as a result of such
event in accordance with Section 1.4(a).
(c) Any of the Seller Parties shall fail to perform or observe any
covenant contained in Section 7.1(h)(ii), Section 7.2 or Section 8.5.
(d) Failure of the Seller to pay any Indebtedness (other than the
Aggregate Unpaids) when due or the default by the Seller in the
performance of any term, provision or condition contained in any
agreement under which any such Indebtedness was created or is governed;
or any such Indebtedness of the Seller 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.
(e) Failure of Performance Guarantor or Vitro America or any of
their respective Subsidiaries other than the Seller to pay Indebtedness
in excess of $10,000,000 in the case of the Performance Guarantor or any
of its Subsidiaries or $1,000,000 in the case of Vitro America or any of
its Subsidiaries in aggregate principal amount (in each case,
hereinafter, "Material Indebtedness") when due (after giving effect to
any applicable grace periods with respect thereto); or the default by
Performance Guarantor, Vitro America or any of its Subsidiaries other
than the Seller in the performance of any term, provision or condition
contained in any agreement under which any Material Indebtedness was
created or is governed if the effect of such default is to cause, or to
permit the holder of such Material Indebtedness to cause such Material
Indebtedness to become due and payable prior to the date of maturity
thereof; or any Material Indebtedness of Performance Guarantor, Vitro
America or any of their respective Subsidiaries other than the Seller
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.
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(f) An Event of Bankruptcy shall occur with respect to Performance
Guarantor, any Seller Party or any of their respective Subsidiaries.
(g) As at the end of any Calculation Period:
(i) the three-month rolling average Delinquency Ratio shall
exceed 4.00%,
(ii) the three-month rolling average Default Ratio shall exceed
4.75%,
(iii) the three-month rolling average Dilution Ratio shall
exceed 4.00%,
(iv) the Loss-to-Liquidation Ratio for the most recently
completed Calculation Period shall exceed 4.00%, or
(v) the three-month rolling average Turnover Ratio shall exceed
70 days.
(h) A Change of Control shall occur.
(i) (i) One or more final judgments for the payment of money in an
aggregate amount of $10,750 or more shall be entered against the Seller
or (ii) one or more final judgments for the payment of money in an amount
in excess of $10,000,000 in the case of the Performance Guarantor or any
of its Subsidiaries or in excess of $1,000,000 in the case of Vitro
America or any of its Subsidiaries, individually or in the aggregate,
shall be entered against Performance Guarantor, Vitro America or any of
their respective Subsidiaries (other than the Seller) 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 forty-five (45) 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 the
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 the 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 the Seller or the
Agent (for the benefit of the Secured Parties) shall cease to have a
valid and perfected first priority security interest in the Purchased
Assets.
(l) On any Settlement Date, after giving effect to the turnover of
Collections by the Servicer on such date and the application thereof to
the Aggregate Unpaids in accordance with this Agreement, the Aggregate
Invested Amount shall exceed the Purchase Limit.
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(m) The Performance Undertaking shall cease to be effective or to be
the legally valid, binding and enforceable obligation of Performance
Guarantor, or Performance Guarantor shall directly or indirectly contest
in any manner such effectiveness, validity, binding nature or
enforceability of its obligations thereunder.
(n) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Tax Code against the Seller, the
Originator or any of their respective Affiliates and such lien shall
continue until the earlier of (i) seven (7) days after inception and (ii)
knowledge by any Secured Party of such lien, or the PBGC shall, or shall
indicate its intention to, file notice of a lien pursuant to Section 4068
of ERISA against the Seller, the Originator or any of their respective
ERISA Affiliates.
(o) Any Plan of Performance Guarantor or any of its ERISA
Affiliates:
(i) shall fail to be funded in accordance with the minimum
funding standard required by applicable law, the terms of such Plan,
Section 412 of the Tax Code or Section 302 of ERISA for any plan
year or a waiver of such standard is sought or granted with respect
to such Plan under applicable law, the terms of such Plan or Section
412 of the Tax Code or Section 303 of ERISA; or
(ii) is being, or has been, terminated or the subject of
termination proceedings under applicable law or the terms of such
Plan; or
(iii) shall require Performance Guarantor or any of its ERISA
Affiliates to provide security under applicable law, the terms of
such Plan, Section 401 or 412 of the Tax Code or Section 306 or 307
of ERISA; or
(iv) results in a liability to Performance Guarantor or any of
its ERISA Affiliates under applicable law, the terms of such Plan,
or Title IV ERISA,
and there shall result from any such failure, waiver, termination or
other event a liability to the PBGC or a Plan that would have a Material
Adverse Effect.
(p) An ERISA Event shall occur which has resulted or could
reasonably be expected to result in a Material Adverse Effect.
(q) Any event shall occur which (i) materially and adversely impairs
the ability of the Originators to originate Receivables of a credit
quality that is at least equal to the credit quality of the Receivables
sold or contributed to the Seller on the date of this Agreement or (ii)
has, or could be reasonably expected to have a Material Adverse Effect.
(r) On any Settlement Date, the Net Pool Balance on such date shall
be less than an amount equal to the sum of (i) the Aggregate Invested
Amount on such date plus (ii) the Required Reserve on such date.
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Section 9.2. Remedies. Upon the occurrence and during the continuation of
an Amortization Event, the Agent may, or upon the direction of the Conduit and
the Required Committed Purchasers shall, take any of the following actions (to
the extent it has not already done so in accordance with the provisions of
this Agreement): (a) except upon a Voluntary Termination (unless another
Amortization Event has occurred) replace the Person then acting as Servicer,
(b) declare the Facility Termination Date to have occurred, whereupon
Reinvestments shall immediately terminate and the Facility Termination Date
shall forthwith occur, all without demand, protest or further notice of any
kind, all of which are hereby expressly waived by the Seller Party; provided,
however, that upon the occurrence of an Event of Bankruptcy with respect to
the Seller Party, the Facility Termination Date shall automatically occur,
without demand, protest or any notice of any kind, all of which are hereby
expressly waived by the Seller Party, (c) deliver the Collection Notices to
the Collection Banks, (d) exercise all rights and remedies of a secured party
upon default under the UCC and other applicable laws, and (e) notify Obligors
of the Agent's security interest in the Receivables and other Purchased
Assets. 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 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, all of which rights shall be cumulative.
ARTICLE X
INDEMNIFICATION
Section 10.1. Indemnities by the Seller Parties. Without limiting any
other rights that the Agent or any Purchaser may have hereunder or under
applicable law, (x) the Seller hereby agrees to indemnify (and pay upon demand
to) the Agent, the Conduit, each of the Committed Purchasers and each of the
respective assigns, officers, directors, agents and employees of the foregoing
(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 and disbursements pursuant to an invoice
in reasonable detail (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 acquisition, either directly or
indirectly, by the Conduit or any Committed Purchaser of an interest in the
Receivables, and (y) 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 solely arising out of the Servicer's activities as
Servicer hereunder excluding, however, in all of the foregoing instances under
the preceding clauses (x) and (y):
(a) 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;
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(b) with respect to the Servicer, 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;
(c) taxes imposed by any jurisdiction in which such Indemnified
Party is organized, its principal executive office is located or it does
business, on or measured by the net income of such Indemnified Party,
other than any taxes on or measured by net income as a result of such
Indemnified Party's having executed, delivered or performed its
obligations, or received payment under or enforced, this Agreement or any
of the other Transaction Documents, or
(d) taxes imposed on any Committed Purchaser (and any Eligible
Assignee thereof) that is not incorporated under the laws of the United
States of America, any state thereof or the District of Columbia, only if
and to the extent that such Committed Purchaser or Eligible Assignee
shall not have furnished to the Seller, at the time or times prescribed
by applicable law, such properly completed and executed documentation
reasonably requested by the Seller as will permit payments under this
Agreement to be made without deduction or withholding, including, without
limitation, United States Internal Revenue Service Form W-9, W-8BEN or
W-8ECI, as applicable, certifying that such Committed Purchaser or
Eligible Assignee is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income tax;
provided, however, that nothing contained in this sentence shall limit the
liability of the Seller Party or limit the recourse of the Agent or any
Purchaser to the Seller Party for amounts otherwise specifically provided to
be paid by the Seller Party under the terms of this Agreement. Without
limiting the generality of the foregoing indemnification, the Seller shall
indemnify the Agent and each Purchaser for Indemnified Amounts (including,
without limitation, losses in respect of uncollectible receivables, regardless
of whether reimbursement therefor would constitute recourse to the Seller)
relating to or resulting from:
(i) any representation or warranty made by the Seller (or any
officers of the Seller) under or in connection with this Agreement, any
other Transaction Document or any other information or report delivered
by such Person pursuant hereto or thereto, which shall have been false or
incorrect when made or deemed made;
(ii) the failure by the Seller to comply with in any material
respect any applicable law, rule or regulation with respect to any
Receivable or Contract related thereto;
(iii) any failure of the Seller to perform in any material respect
its duties, covenants or other obligations in accordance with the
provisions of this Agreement or any other Transaction Document;
(iv) any products liability, personal injury or damage suit, or
other similar claim arising out of or in connection with merchandise,
insurance or services that are the subject of any Contract or any
Receivable;
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(v) 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;
(vi) the commingling of Collections of Receivables at any time with
other funds;
(vii) any failure of a Collection Bank to comply with the terms of
the applicable Collection Account Agreement;
(viii) any investigation, litigation or proceeding related to or
arising from this Agreement or any other Transaction Document, the
transactions contemplated hereby, the use by the Seller of the proceeds
of any Purchase, the Purchased Assets or any other investigation,
litigation or proceeding relating to such Person in which any Indemnified
Party becomes involved as a result of any of the transactions
contemplated hereby;
(ix) any Amortization Event other than a Voluntary Termination;
(x) any failure of the Seller to acquire and maintain legal and
equitable title to, and ownership of any of the Purchased Assets from the
Originator, free and clear of any Adverse Claim (other than as created
hereunder); or any failure of the Seller to give reasonably equivalent
value to the Originator under the Receivables Sale Agreement in
consideration of the transfer by such Originator of any Receivable, or
any attempt by any Person to void such transfer under statutory
provisions or common law or equitable action;
(xi) 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 Secured Parties, a valid first priority perfected security interests
in the Purchased Assets, free and clear of any Adverse Claim (except as
created by the Transaction Documents);
(xii) the failure by the Seller to have filed, or any delay in
filing, financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable laws
with respect to any Purchased Assets, and the proceeds thereof, whether
at the time of any Purchase or at any subsequent time;
(xiii) any action or omission by the Seller which reduces or impairs
the rights of the Agent or any Purchaser with respect to any Purchased
Assets or the value of any Purchased Assets; and
(xiv) any attempt by any Person to void any Purchase or the Agent's
security interest in the Purchased Assets under statutory provisions or
common law or equitable action.
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Section 10.2. Increased Cost and Reduced Return. If after the date
hereof, any Funding Source shall be charged any fee, expense or increased cost
(other than taxes) 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"): (a) 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 (b) 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 (c) 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,
accompanied by a certificate of such Funding Source setting forth the
calculation of such amounts in reasonable detail (which certificate shall be
conclusive in the absence of manifest error), the 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. For avoidance of doubt, any
interpretation of Accounting Research Bulletin No. 51 by the Financial
Accounting Standards Board shall constitute an adoption, change, request or
directive subject to this Section 10.2.
Section 10.3. Other Costs and Expenses. The Seller shall pay to the
Agent and each Purchaser on demand all reasonable 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 the Conduit's auditors auditing the books, records and procedures of
the Seller, reasonable fees and out-of-pocket expenses of legal counsel for
the Purchasers and the Agent with respect thereto and with respect to advising
the Purchasers and the Agent as to their respective rights and remedies under
this Agreement pursuant to an invoice in reasonable detail. The Seller shall
pay to the Agent on demand any and all costs and expenses of the Agent and
each Purchaser, if any, including 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. Subject to Section 10.4, the Seller shall reimburse the Conduit on
demand for all other reasonable costs and expenses incurred by the Conduit
("Other Costs"), including, without limitation, the cost of auditing the
Conduit'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 the Conduit or any counsel for
any shareholder of the Conduit with respect to advising the Conduit or such
shareholder as to matters relating to the Conduit's operations.
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Section 10.4. Allocations. The Conduit shall allocate in a consistent
manner the liability for Other Costs among the Seller and other Persons with
whom the Conduit has entered into agreements to purchase interests in or
finance receivables and other financial assets ("Other Customers"). If any
Other Costs are attributable to the Seller and not attributable to any Other
Customer, the Seller shall be solely liable for such Other Costs. However, if
Other Costs are attributable to Other Customers and not attributable to the
Seller, such Other Customer shall be solely liable for such Other Costs. All
allocations to be made pursuant to the foregoing provisions of this Article X
shall be made by the Conduit in its sole discretion and shall be binding on
the Seller and the Servicer.
ARTICLE XI
THE AGENT
Section 11.1. Authorization and Action. Each Purchaser, on behalf of
itself and its assigns, hereby designates and appoints ABN AMRO Bank N.V. to
act as its agent under the Liquidity Agreement, this Agreement 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 the Liquidity Agreement, this Agreement and the other
Transaction Documents together with such powers as are reasonably incidental
thereto, including, without limitation, the power to perfect all security
interests granted under the Transaction Documents. The provisions of Section 6
of the Liquidity Agreement are hereby incorporated by this reference with the
same force and effect as if fully set forth herein, and shall govern the
relationship between the Agent, on the one hand, and each Purchaser, on the
other.
ARTICLE XII
ASSIGNMENTS AND PARTICIPATIONS
Section 12.1. Successors and Assigns; Participations; Assignments.
(a) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns. Except as otherwise provided herein, the Seller may not assign or
transfer any of its rights or delegate any of its duties without the prior
consent of the Agent and the Purchasers.
(b) Participations. Any Purchaser may sell to one or more Persons (each a
"Participant") participating interests in the interests of such Purchaser
hereunder and under the Liquidity Agreement. Such Purchaser shall remain
solely responsible for performing its obligations hereunder, and the Seller
and the Agent shall continue to deal solely and directly with such Purchaser
in connection with such Purchaser's rights and obligations hereunder and under
the Liquidity Agreement. Each Participant shall be entitled to the benefits of
Article X and shall have the right of setoff through its participation in
amounts owing hereunder and under the Liquidity Agreement to the same extent
as if it were a Purchaser hereunder and under the Liquidity Agreement, which
right of setoff is subject to such Participant's obligation to share
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with the Purchasers as provided in Section 13.14. A Purchaser shall not agree
with a Participant to restrict such Purchaser's right to agree to any
amendment hereto or to the Liquidity Agreement, except amendments described in
clause (b) of Section 13.1.
(c) Assignments by Committed Purchasers. Any Committed Purchaser may
assign to one or more financial institutions ("Purchasing Committed
Purchasers") rated at least A-1+/P-1 and otherwise acceptable to the Agent in
its sole discretion, any portion of its Commitment as a Committed Purchaser
hereunder and under the Liquidity Agreement and Receivable Interest pursuant
to a supplement hereto and to the Liquidity Agreement (a "Transfer
Supplement") in form satisfactory to the Agent executed by each such
Purchasing Committed Purchaser, such selling Committed Purchaser and the
Agent. Prior to the occurrence of an Amortization Event, any such assignment
shall require the prior written consent of the Seller which shall not be
unreasonably withheld. Any such assignment by a Committed Purchaser must be
for an amount of at least Five Million Dollars. Each Purchasing Committed
Purchaser shall pay a fee of Three Thousand Dollars to the Agent. Any partial
assignment shall be an assignment of an identical percentage of such selling
Committed Purchaser's Invested Amount and its Commitment as a Committed
Purchaser hereunder and under the Liquidity Agreement. Upon the execution and
delivery to the Agent of the Transfer Supplement and payment by the Purchasing
Committed Purchaser to the selling Committed Purchaser of the agreed purchase
price, such selling Committed Purchaser shall be released from its obligations
hereunder and under the Liquidity Agreement to the extent of such assignment
and such Purchasing Committed Purchaser shall for all purposes be a Committed
Purchaser party hereto and shall have all the rights and obligations of a
Committed Purchaser hereunder to the same extent as if it were an original
party hereto and to the Liquidity Agreement with a Commitment as a Committed
Purchaser, any Invested Amount and any related Assigned Conduit Settlement
described in the Transfer Supplement.
(d) Replaceable Committed Purchasers. If any Committed Purchaser other
than ABN AMRO (a "Replaceable Committed Purchaser") shall (i) petition the
Seller for any amounts under Section 10.2 or (ii) have a short-term debt
rating lower than the "A-1+" by S&P and "P-1" by ▇▇▇▇▇'▇, the Seller or the
Conduit may designate a replacement financial institution (a "Replacement
Committed Purchaser") reasonably acceptable to the Agent and, prior to the
occurrence of an Amortization Event, consented to by the Seller (which consent
shall not be unreasonably withheld) to which such Replaceable Committed
Purchaser shall, subject to its receipt of an amount equal to its Investment,
any related Assigned Conduit Settlement, and accrued Yield and fees thereon
and all amounts payable under Section 10.2, promptly assign all of its rights,
obligations and Commitment hereunder and under the Liquidity Agreement,
together with all of its Purchase Interest, and any related Assigned Conduit
Settlement, to the Replacement Committed Purchaser in accordance with Section
12.1(c).
(e) Assignment by the Conduit. Each party hereto agrees and consents (i)
to the Conduit's assignment, participation, grant of security interests in or
other transfers of any portion of, or any of its beneficial interest in, the
Conduit's Receivable Interest and the Conduit Settlement and (ii) to the
complete assignment by the Conduit of all of its rights and obligations
hereunder to ABN AMRO or any other Person, and upon such assignment the
Conduit shall be released from all obligations and duties hereunder to the
extent accruing thereafter; provided, however, that the Conduit may not,
without the prior consent of the Required Purchasers and,
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prior to the occurrence of an Amortization Event, the Seller, which consent of
the Seller shall not be unreasonably withheld, transfer any of its rights
hereunder or under the Liquidity Agreement unless the assignee (i) is a
corporation whose principal business is the purchase of assets similar to the
Receivables, (ii) has ABN AMRO as its administrative agent and (iii) issues
commercial paper with credit ratings substantially identical to the Ratings.
The Conduit shall promptly notify each party hereto of any such assignment.
Upon such an assignment of any portion of the Conduit's Purchase Interest and
the Conduit Settlement, the assignee shall have all of the rights of the
Conduit hereunder relate to such Conduit Purchase Interest and the Conduit
Settlement.
(f) Opinions of Counsel. If required by the Agent or to maintain the
Ratings, each Transfer Supplement must be accompanied by an opinion of counsel
of the assignee as to such matters as the Agent may reasonably request.
Section 12.2. Prohibition on Assignments by the Seller Parties. No Seller
Party may assign any of its rights or obligations under this Agreement without
the prior written consent of each of the Agent and each Purchaser.
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 or any other Transaction Document 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 or any other Transaction Document shall be effective
only in the specific instance and for the specific purpose for which given.
(b) No provision of this Agreement or any other Transaction Document may
be amended, supplemented, modified or waived except in writing in accordance
with the provisions of this Section 13.1(b). The Purchasers, the Seller and
the Agent, at the direction of the Conduit and the Required Committed
Purchasers, may enter into written modifications or waivers of any provisions
of this Agreement and any other Transaction Document, provided, however, that
no such modification or waiver shall:
(i) without the consent of the Conduit and each affected Committed
Purchaser, (A) extend the Liquidity Termination Date or the date of any
payment or deposit of Collections by the 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 any Purchaser, (D) change the Invested
Amount of any Receivable Interest, (E) amend, modify or waive any
provision of the definition of Required Committed Purchasers or this
Section 13.1(b), (F) consent to or permit the assignment or transfer by
the Seller of any of its rights and obligations under this Agreement, (G)
change the definition of "Eligible Receivable," "Loss
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Reserve," "Dilution Reserve," "Yield Reserve," "Servicing Reserve,"
"Servicing Fee Rate," "Required Reserve" or "Required Reserve Factor
Floor" or (H) amend or modify any defined term (or any defined term used
directly or indirectly in such defined term) used in clauses (A) through
(G) above in a manner that would circumvent the intention of the
restrictions set forth in such clauses; or
(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.
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 facsimile numbers set forth on the signature pages hereof or at
such other address or facsimile number as such Person may hereafter specify
for the purpose of notice to each of the other parties hereto. Each such
notice or other communication shall be effective (a) if given by facsimile,
upon the receipt thereof, (b) if given by mail, three (3) Business Days after
the time such communication is deposited in the mail with first class postage
prepaid or (c) if given by any other means, when received at the address
specified in this Section 13.2. The Seller hereby authorizes the Agent to
effect Purchases and Tranche Period and Yield Rate selections based on
telephonic notices made by any Person whom the Agent in good faith believes to
be acting on behalf of the Seller. The Seller agrees to deliver promptly to
the Agent a written confirmation of each telephonic notice signed by an
authorized officer of the 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, the records of the
Agent shall govern absent manifest error.
Section 13.3. Protection of Agent's Security Interest. (a) The Seller
agrees that from time to time, at its expense, it will promptly authorize and
deliver all instruments and documents, and take all actions, that may be
necessary or desirable, or that the Agent may reasonably request, to perfect,
protect or more fully evidence the Agent's security interest in the Purchased
Assets, or to enable the Agent or any Purchaser to exercise and enforce their
rights and remedies hereunder. After the occurrence of an Amortization Event
or an Unmatured Amortization Event, the Agent may, or the Agent may direct the
Seller or the Servicer to, notify the Obligors of Receivables, at the Seller's
expense, of the ownership or security interests of the Agent 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. The Seller or the Servicer (as applicable) shall, at the Agent's
request, withhold the identities of the Agent and each 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
Purchaser's costs and expenses incurred in connection therewith shall be
payable by the Seller as provided in Section 10.3. Each Seller Party
irrevocably authorizes the Agent at any time and from time to time 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
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behalf of the Seller as debtor and to file financing statements necessary or
desirable in the Agent's sole discretion to perfect and to maintain the
perfection and priority of the interest of the Agent on behalf 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 Agent's security interest in the Purchased
Assets, for the benefit of the Secured Parties. This appointment is coupled
with an interest and is irrevocable.
(c) (A) Each of the Seller Parties hereby authorizes the Agent to file
financing statements and other filing or recording documents with respect to
the Receivables and Related Security (including any amendments thereto, or
continuation or termination statements thereof), without the signature or
other authorization of the Seller Party, in such form and in such offices as
the Agent reasonably determines appropriate to perfect or maintain the
perfection of the security interest of the Agent hereunder, (B) each of the
Seller Parties acknowledges and agrees that it is not authorized to, and will
not, file financing statements or other filing or recording documents with
respect to the Receivables or Related Security (including any amendments
thereto, or continuation or termination statements thereof), without the
express prior written approval by the Agent, consenting to the form and
substance of such filing or recording document, and (C) each of the Seller
Parties approves, authorizes and ratifies any filings or recordings made by or
on behalf of the Agent in connection with the perfection of the security
interests in favor of the Seller or the Agent.
Section 13.4. Confidentiality. (a) Each of the Seller Parties shall
maintain and shall cause each of its employees and officers to maintain in
confidence any 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 (including, without limitation, the Fee
Letter), except that such Seller Party and its officers and employees may
disclose such information to such Seller Party'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).
(b) 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 Committed Purchasers or the Conduit by each other,
(ii) by the Agent, any Committed Purchaser or the Conduit (or its permitted
assigns) to any prospective or actual assignee or participant of any of them
and (iii) by the Agent to any rating agency, Commercial Paper dealer or
provider of a surety, guaranty or credit or liquidity enhancement to the
Conduit or any entity organized for the purpose of purchasing, or making loans
secured by, financial assets for which the Conduit acts as the administrative
agent and to any officers, directors, employees, outside accountants and
attorneys of any of the foregoing, provided that each such Person is informed
of the confidential nature of such information. In addition, the Conduit, each
Committed Purchaser and the Agent may disclose any such nonpublic information
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).
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(c) Notwithstanding any other express or implied agreement to the
contrary, the parties agree and acknowledge that each of them and each of
their employees, representatives, and other agents may disclose to any and all
persons, without limitation of any kind, the tax treatment and tax structure
of the transaction and all materials of any kind (including opinions or other
tax analyses) that are provided to any of them relating to such tax treatment
and tax structure, except to the extent that confidentiality is reasonably
necessary to comply with U.S. federal or state securities law. For purposes of
this paragraph, the terms "tax treatment" and "tax structure" have the
meanings specified in Treasury Regulation section 1.6011-4(c).
Section 13.5. Bankruptcy Petition. Each party hereto agrees, for the
benefit of the holders of the privately or publicly placed indebtedness for
borrowed money for the Conduit, not, prior to the date which is one (1) year
and one (1) day after the payment in full of all such indebtedness, to
acquiesce, petition or otherwise, directly or indirectly, invoke, or cause the
Conduit to invoke, the process of any Governmental Authority for the purpose
of (a) commencing or sustaining a case against the Conduit under any federal
or state bankruptcy, insolvency or similar law (including the Federal
Bankruptcy Code), (b) appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official for the Conduit, or any
substantial part of its property, or (c) ordering the winding up or
liquidation of the affairs of the Conduit. The provisions of this Section 13.5
shall survive the termination of this Agreement.
Section 13.6. Limitation of Liability. Except with respect to any claim
arising out of the willful misconduct or gross negligence of the Conduit, the
Agent or any Committed Purchaser, no claim may be made by any Seller Party or
any other Person against the Conduit, the Agent or any Committed Purchaser 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 13.7. Choice of Law. THIS AGREEMENT SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF
THE GENERAL OBLIGATIONS LAW AND EXCEPT TO THE EXTENT THAT THE PERFECTION OF
THE OWNERSHIP INTEREST OF SELLER OR THE SECURITY INTEREST OF THE AGENT, FOR
THE BENEFIT OF THE SECURED PARTIES, IN ANY OF THE PURCHASED ASSETS IS GOVERNED
BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
Section 13.8. Consent to Jurisdiction. EACH PARTY TO THIS AGREEMENT
HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED
STATES FEDERAL OR NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
NEW YORK, 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 SUCH 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
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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 THE BOROUGH OF
MANHATTAN IN NEW YORK, NEW YORK.
Section 13.9. 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 13.10. Integration; Binding Effect; Survival of Terms. (a) This
Agreement and each other Transaction Document contain the final and complete
integration of all prior expressions by the parties hereto with respect to the
subject matter hereof and shall constitute the entire agreement among the
parties hereto with respect to the subject matter hereof superseding all prior
oral or written understandings.
(b) This Agreement shall be binding upon and inure to the benefit of 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 Section 13.4 and Section 13.5 shall be continuing
and shall survive any termination of this Agreement.
Section 13.11. 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. Delivery of an executed counterpart of
a signature page to this Agreement by fax or other electronic transmission
shall be effective as delivery of a manually executed counterpart of a
signature page to this 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 13.12. Characterization; Power of Attorney. (a) It is the
intention of the parties hereto that, other than for federal, state and local
income and franchise tax purposes, each
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Purchase hereunder shall constitute and be treated as an absolute and
irrevocable sale, which Purchase shall provide the Purchasers with the full
benefits of ownership of the applicable Receivable Interest. Except as
specifically provided in this Agreement, each sale of a Receivable Interest
hereunder is made without recourse to the Seller; provided, however, that (i)
the Seller shall be liable to the Purchasers and the Agent for all
representations, warranties, covenants and indemnities made by the 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 the Purchasers or
the Agent or any assignee thereof of any obligation of the Seller or the
Originator or any other person arising in connection with the Receivables, the
Related Security, or the related Contracts, or any other obligations of the
Seller or the Originator. It is the intention of the parties hereto that for
federal, state and local income and franchise tax purposes, the Purchasers,
acquisition of the Receivables Interests shall be treated as a secured loan by
the Purchasers to the Seller, and each party hereto agrees to characterize all
Purchases hereunder as secured loans on all tax returns filed by such party.
(b) In addition to any ownership interest which the Agent or any
Purchaser may from time to time acquire pursuant hereto, the Seller hereby
grants to the Agent for the ratable benefit of the Secured Parties, a valid
and perfected security interest in all of the Seller's assets, whether now
owned or hereafter acquired, including, without limitation, all of the
Seller's right, title and interest in, to and under the Purchased Assets, and
all proceeds thereof prior to all other liens on and security interests
therein to secure the prompt and complete payment of the Aggregate Unpaids.
The Agent, on behalf of the Secured Parties, shall have, in addition to the
rights and remedies that it may have under this Agreement, all other rights
and remedies provided to a secured creditor under the UCC and other applicable
law, which rights and remedies shall be cumulative.
(c) On the Closing Date, each of the Seller and the Servicer shall
execute and deliver a power of attorney substantially in the form attached
hereto as Exhibit XI (each, a "Power of Attorney"). The power of attorney
granted pursuant to each Power of Attorney is a power coupled with an interest
and shall be irrevocable until all Aggregate Unpaids are indefeasibly paid or
otherwise satisfied in full. The powers conferred on the Agent under each
Power of Attorney are solely to protect the Agent's security interest on
behalf of the Secured Parties and shall not impose any duty upon the Agent to
exercise any such powers. The Agent shall not be accountable for any amount
other than amounts that it actually receives as a result of the exercise of
such powers and none of the Agent's officers, directors, employees, agents or
representatives shall be responsible to the Seller or the Servicer for any act
or failure to act, except in respect of damages attributable solely to their
own gross negligence or willful misconduct as finally determined by a court of
competent jurisdiction. The Agent shall exercise its rights and remedies under
the Power of Attorney only to the extent otherwise permitted under the
Transaction Documents.
Section 13.13. Excess Funds. Notwithstanding any provisions contained in
this Agreement to the contrary, the Conduit shall not, and shall not be
obligated to, pay any amount pursuant to this Agreement unless (i) the Conduit
has received funds which may be used to make such payment and which funds are
not required to repay its commercial paper notes when due and (ii) after
giving effect to such payment, either (x) the Conduit could issue commercial
paper notes to
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refinance all of its outstanding commercial paper notes (assuming such
outstanding commercial paper notes matured at such time) in accordance with
the program documents governing the Conduit's securitization program or (y)
all of the Conduit's commercial paper notes are paid in full. Any amount which
the Conduit does not pay pursuant to the operation of the preceding sentence
shall not constitute a claim (as defined in ss.101 of the United States
Bankruptcy Code) against or corporate obligation of the Conduit for any such
insufficiency unless and until the Conduit satisfies the provisions of clauses
(i) and (ii) above. This Section shall survive the termination of this
Agreement.
Section 13.14. Sharing of Recoveries. Each Purchaser agrees that if it
receives any recovery, through set-off, judicial action or otherwise, on any
amount payable or recoverable hereunder in a greater proportion than should
have been received hereunder or otherwise inconsistent with the provisions
hereof, then the recipient of such recovery shall purchase for cash an
interest in amounts owing to the other Purchasers (as return of Investment or
otherwise), without representation or warranty except for the representation
and warranty that such interest is being sold by each such other Purchaser
free and clear of any Adverse Claim created or granted by such other
Purchaser, in the amount necessary to create proportional participation by the
Purchasers in such recovery (as if such recovery were distributed pursuant to
Section 2.3). If all or any portion of such amount is thereafter recovered
from the recipient, such purchase shall be rescinded and the purchase price
restored to the extent of such recovery, but without interest.
[SIGNATURE PAGES TO 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 or attorneys-in-fact
as of the date hereof.
VVP FUNDING CORPORATION
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: President
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Secretary
Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
VITRO AMERICA, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President/Finance
Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
[ADDITIONAL SIGNATURES TO FOLLOW]
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WINDMILL FUNDING CORPORATION
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Address:
c/o Global Securitization Services,
LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
ABN AMRO BANK N.V., as Agent
By /s/ S. ▇▇▇▇ ▇▇▇▇
------------------------------------
Name: S. ▇▇▇▇ ▇▇▇▇
Title: Senior Vice President
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Group Vice President
Address:
Structured Finance, Asset
Securitization
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Agent
ABN AMRO BANK N.V., as Committed
Purchaser
By /s/ S. ▇▇▇▇ ▇▇▇▇
------------------------------------
Name: S. ▇▇▇▇ ▇▇▇▇
Title: Senior Vice President
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Group Vice President
Address:
Structured Finance, Asset
Securitization
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Windmill-Committed
Purchaser
[END OF SIGNATURES]
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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):
"ABN AMRO"-- ABN AMRO Bank N.V.
"Adjusted Dilution Ratio" -- At any time, the rolling average of the
Dilution Ratio for the twelve (12) Calculation Periods then most recently
ended.
"Adverse Claim" -- 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.
"Affiliate" -- 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 10% 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" -- As defined in the preamble.
"Agent's Account" -- The account designated to the Seller and the
Purchasers the Agent.
"Aggregate Commitment" -- $40,800,000, as such amount may be reduced
pursuant to Section 1.1(c).
"Aggregate Invested Amount" -- On any date of determination, the
aggregate Invested Amount of all Receivable Interests outstanding on such
date.
"Aggregate Reduction" -- As defined in Section 1.3(b).
"Aggregate Unpaids" -- At any time, an amount equal to the sum of (i) the
Aggregate Invested Amount, plus (ii) all Obligations (whether due or accrued)
at such time.
"Agreement" -- This Receivables Purchase Agreement, as it may be amended
or modified and in effect from time to time.
"Amortization Date" -- The earliest to occur of (i) the Business Day
immediately prior to the occurrence of an Event of Bankruptcy with respect to
the Seller Party, (ii) the Business Day specified in a written notice from the
Agent following the occurrence of any other Amortization Event, and (iii) the
date which is ten (10) Business Days after the Agent's receipt of written
notice from the Seller that it wishes to terminate the facility evidenced by
this Agreement.
"Amortization Event" -- As defined in Article IX.
"Applicable Margin"-- As defined in the Fee Letter.
"Application For Payment" -- With respect to any Progress Billed
Receivable, an invoice submitted in accordance with the underlying Contract by
the Originator to the related architect requesting a progress payment with
respect to the related contract price.
"Authorized Officer" -- With respect to any Person, its president, any
vice president, corporate controller, treasurer or chief financial officer.
"Bank of America Depositary Account" -- Each deposit account maintained
with Bank of America, N.A. established by the Originator for the deposit of
Collections. Each such Bank of America Depositary Account shall be listed on
Exhibit IV hereto.
"Breakage Fee"-- As defined in the Subservicing Agreement.
"Broken Funding Costs" -- For any Receivable Interest which: (i) has its
Invested Amount reduced without compliance by the 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
by the Conduit to the Committed Purchasers under the Liquidity Agreement or
terminated prior to the date on which it was 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 Agent to
relate to such Receivable 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 Invested Amount of such Receivable Interest if such
reduction, assignment or termination had not occurred or such Reduction Notice
had not been delivered, over (B) the sum of (1) to the extent all or a portion
of such Invested Amount is allocated to another Receivable Interest, the
amount of CP Costs or Yield actually accrued during the remainder of such
period on such Invested Amount for the new Receivable Interest, and (2) to the
extent such Invested Amount is not allocated to another Receivable Interest,
the income, if any, actually received during the remainder of such period by
the holder of such Receivable Interest from investing the portion of such
Invested Amount not so allocated. All Broken Funding Costs shall be due and
payable hereunder upon demand.
"Business Day" -- 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.
"Calculation Period" -- A calendar month.
-2-
"Change of Control" -- (i) either (A) Vitro, S.A. de CV shall cease to
own, beneficially and of record, directly or through one or more wholly-owned
Subsidiaries, at least 51% of the outstanding Voting Shares of the Performance
Guarantor or (B) ▇▇▇▇▇▇▇▇▇▇ PLC shall cease to own, beneficially and of
record, directly or through one or more wholly-owned Subsidiaries, at least
35% of the outstanding Voting Shares of the Performance Guarantor, (ii) the
Performance Guarantor shall cease to own beneficially and of record, directly
or through one or more wholly owned Subsidiaries at least 75% of the
outstanding Voting Shares of Vitro America or (iii) Vitro America ceases to
own 100% of the outstanding shares of capital stock of the Seller free and
clear of any Adverse Claim.
"Charge-Off" -- Any Receivable that has or should have been (in
accordance with the Credit and Collection Policy) charged off or written off
by the Seller.
"Clean Up Call" -- As defined in Section 2.5(a).
"Closing Date" -- May 7, 2004.
"Collection Account" -- Each Concentration Account, Bank of America
Depositary Account, the Facility Account and such lock-box account or similar
account in which any Collections are collected or deposited (excluding Other
Depositary Accounts). Each Collection Account shall be listed on Exhibit IV
hereto.
"Collection Account Agreement" -- An agreement substantially in the form
of Exhibit VI hereto or such other form as the Agent may agree among the
Originator, Servicer, the Seller, the Agent and a Collection Bank.
"Collection Bank" -- At any time, any of the banks holding one or more
Collection Accounts.
"Collection Notice" -- A notice, in substantially the form of Annex A to
Exhibit VI hereto or such other form as the Agent may agree, from the Agent to
a Collection Bank.
"Collections" -- With respect to any Receivable, all cash collections and
other cash proceeds in respect of such Receivable, including, without
limitation, all Deemed Collections, all Finance Charges or other related
amounts accruing in respect thereof and all cash proceeds of Related Security
with respect to such Receivable.
"Commercial Paper" -- Promissory notes of the Conduit issued in the
commercial paper market.
"Committed Purchasers" -- As defined in Section 1.1(b).
"Commitment" -- For each Committed Purchaser, the amount set forth on
Schedule B, as adjusted in accordance with Sections 1.1(c) and 12.1.
-3-
"Concentration Account" -- Each segregated deposit account established by
the Seller for the deposit of Collections.
"Conduit" -- As defined in the preamble to this Agreement.
"Conduit Settlement" -- The sum of all claims and rights to payment
pursuant to Section 1.4 or 2.7 or any other provision owed to the Conduit (or
owed to the Agent or the Collection Agent on behalf of the Conduit) by the
Seller that, if paid, would be applied to reduce the Conduit's Invested
Amount.
"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" -- With respect to any Receivable, any and all instruments,
agreements, invoices or other writings pursuant to which such Receivable
arises or which evidences such Receivable.
"CP Costs" -- For any day, means the product of (i) the per annum rate
(inclusive of dealer fees and commissions) paid or payable by the Conduit in
respect of Commercial Paper on such day that are allocated, in whole or in
part, to fund or maintain its Invested Amount for such day, as determined by
the Agent and other costs allocated by the Conduit to fund or maintain its
Invested Amount associated with the funding by the Conduit of small or odd lot
amounts that are not funded with Commercial Paper and (ii) the Conduit's
Invested Amount as of the end of such day and (iii) 1/360.
"Credit Agreement" -- That certain Loan Agreement dated as of February
26, 2003, by and among the Performance Guarantor, VVP Holding Corp., VVP
Syndication, Inc., Citibank, N.A. and Wachovia Bank, National Association.
"Credit and Collection Policy" -- The Seller's credit and collection
policies and practices relating to Contracts and Receivables existing on the
date hereof and summarized in Exhibit VII hereto, as modified from time to
time in accordance with this Agreement.
"Cut-Off Date" -- The last day of a Calculation Period.
"Daily Report" -- A report, in substantially the form of Exhibit VIII
hereto (appropriately completed), furnished by the Servicer to the Agent
pursuant to Section 8.5.
"Debt to EBITDA Ratio" -- As defined in the Credit Agreement.
-4-
"Deemed Collections" -- Collections deemed received by the Seller under
Section 1.4(a).
"Default Horizon Ratio" -- As of any Cut-Off Date, the ratio (expressed
as a decimal) computed by dividing (i) the aggregate Outstanding Balance of
Eligible Receivables (the Outstanding Balance of each Eligible Receivable
being the Outstanding Balance thereof as at the time the relevant Eligible
Receivable was originated) that were originated by the Originators during the
five (5) Calculation Periods ending on such Cut-Off Date, by (ii) the Net Pool
Balance as of such Cut-off Date.
"Default Rate" -- A rate per annum equal to the sum of (i) the Prime Rate
plus (ii) 2.00%, changing when and as the Prime Rate changes.
"Default Ratio" -- As of any Cut-Off Date, the ratio (expressed as a
percentage) computed by dividing (i) the total amount of Receivables which
were unpaid more than 120 days and less than 151 days during the Calculation
Period that includes such Cut-Off Date plus any Charge-Offs made during such
Calculation Period with respect to Receivables which were not unpaid for 121
days or more, by (ii) the Outstanding Balance of Receivables originated by the
Originators during the Calculation Period occurring five (5) months prior to
the Calculation Period ending on such Cut-Off Date.
"Default Reserve Ratio" -- As of any Cut-Off Date, the ratio (expressed
as a percentage) computed by dividing (i) the total amount of Receivables that
were Eligible Receivables when originated which were unpaid more than 120 days
and less than 151 days during the Calculation Period that includes such
Cut-Off Date plus any Charge-Offs made during such Calculation Period with
respect to Receivables which were not unpaid for 121 days or more, by (ii) the
Outstanding Balance of Eligible Receivables originated by the Originators
during the Calculation Period occurring five (5) months prior to the
Calculation Period ending on such Cut-Off Date.
"Defaulted Receivable" -- A Receivable: (i) as to which the Obligor
thereof has suffered an Event of Bankruptcy; or (ii) as to which any payment,
or part thereof, remains unpaid for 121 days or more from the original due
date for such payment.
"Delinquency Ratio" -- 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.
"Delinquent Receivable" -- A Receivable that was an Eligible Receivable
when originated as to which any payment, or part thereof, remains unpaid for
91 days or more but less than 121 days from the original due date for such
payment.
"Depositary Account" -- Each deposit account established by the
Originator for the deposit of Collections. Each such Depositary Account shall
be listed on Exhibit IV hereto.
"Dilution" -- The amount of any reduction or cancellation of the
Outstanding Balance of a Receivable as described in Section 1.4(a).
-5-
"Dilution Horizon" -- As of any Cut-Off Date, a number of months
(expressed as a decimal) computed by dividing (i) the sum of the product of,
for each invoice originated by the Originators, (a) the amount of each
Dilution during the twelve (12) Calculation Periods ending on such Cut-Off
Date for any such invoice, times (b) the number of days from the origination
of such invoice to such Dilution, divided by (ii) the product of (a) 30 times
(b) the sum of, for each invoice originated by the Originators, the amount of
each Dilution during the twelve (12) Calculation Periods ending on such
Cut-Off Date.
"Dilution Horizon Ratio" -- As of any Cut-Off Date, a ratio (expressed as
a decimal), computed by dividing (i) the aggregate Outstanding Balance of
Eligible Receivables (the Outstanding Balance of each Eligible Receivable
being the Outstanding Balance thereof as at the time the relevant Eligible
Receivable was originated) that were originated by the Originators during a
number of Calculation Periods (or proportional fraction thereof) equal to the
Dilution Horizon and ending on such Cut-Off Date (the amount of Eligible
Receivables originated during any fraction of a Calculation Period being a
proportionate amount of all the Eligible Receivables originated during such
Calculation Period), by (ii) the Net Pool Balance as of such Cut-Off Date.
"Dilution Ratio" -- As of any Cut-Off Date, a ratio (expressed as a
percentage), computed by dividing (i) the total amount of decreases in
Outstanding Balances due to Dilutions during the Calculation Period ending on
such Cut-Off Date arising from Receivables that were Eligible Receivables
during all or any portion of such Calculation Period, by (ii) the aggregate
Outstanding Balance of Eligible Receivables originated by the Originators
during the two Calculation Periods prior to the Calculation Period ending on
such Cut-Off Date.
"Dilution Reserve" -- For any Calculation Period, the product (expressed
as a percentage) of:
(i) the sum of (A) two (2) times the Adjusted Dilution Ratio as of
the related Cut-Off Date, plus (B) the Dilution Volatility Component as
of the related Cut-Off Date, times
(ii) the Dilution Horizon Ratio as of the related Cut-Off Date.
"Dilution Volatility Component" -- The product (expressed as a
percentage) of (i) the difference between (A) the highest three (3)-month
rolling average Dilution Ratio over the past twelve (12) Calculation Periods
and (B) the Adjusted Dilution Ratio, and (ii) a fraction, the numerator of
which is equal to the amount calculated in (i)(A) of this definition and the
denominator of which is equal to the amount calculated in (i)(B) of this
definition.
"Downgraded Committed Purchaser" -- A Committed Purchaser which has been
the subject of a Downgrading Event.
"Downgrading Event" -- With respect to any Person means the lowering of
the rating with regard to the short-term securities of such Person to below
(i) A-1 by S&P, or (ii) P-1 by Moody's.
"Eligible Assignee" -- A commercial bank having a combined capital and
surplus of at least $250,000,000 with a rating of its (or its parent holding
company's) short-term securities
-6-
equal to or higher than (i) A-1+ by S&P and (ii) P-1 by Moody's and which, if
not organized under the laws of the United States or any state thereof, has
furnished to the Seller two completed copies of the United States Internal
Revenue Service Form W-8BEN or W-8ECI, as applicable, certifying in either
case that such bank is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes;
provided, that prior to the occurrence of an Amortization Event, any such
Person shall also be reasonably acceptable to the Seller.
"Eligible Progress Billed Receivable"-- Any Progress Billed Receivable:
(i) which is originated pursuant to a Form Progress Billed
Receivable Contract;
(ii) for which an Application For Payment has been submitted in good
faith by the Originator, which such Application For Payment is true,
accurate and complete in all material respects; and
(iii) for which payment is due from the Obligor not later than
twenty (20) days after the related architect receives such Application
For Payment;
provided, however, that if the Debt to EBITDA Ratio shall be greater than 3.00
to 1.00, no Progress Billed Receivable shall be deemed to be an "Eligible
Progress Billed Receivable".
"Eligible Receivable" -- 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; and (C) is
not (except as set forth in clause (xx) below) a government or a
governmental subdivision or agency,
(ii) which is not a Defaulted Receivable or owing from an Obligor as
to which more than 50% of the aggregate Outstanding Balance of all
Receivables owing from such Obligor are Defaulted Receivables,
(iii) which is not a Delinquent Receivable; provided, however, up to
50% of all Receivables which by their terms are Delinquent Receivables
shall be deemed "Eligible Receivables" so long as they meet all other
requirements of this definition,
(iv) which (A) is an Eligible Progress Billed Receivable or (B) by
its terms is due and payable within thirty (30) days of the original
billing date therefor and has not had its payment terms extended more
than once; provided, however, up to 10% of Receivables (other than
Progress Billed Receivables) which by their terms are due and payable
greater than thirty (30) days but less than sixty-one (61) days after the
original billing date therefor shall be deemed "Eligible Receivables" so
long as they meet all other
-7-
requirements of this definition; provided,further that no more than
10% of all Receivables shall be "Eligible Progress Billed Receivables";
provided, further, that no more than 1% of all Receivables shall include
any "service charge" payment,
(v) which is not a "COD" or "cash on delivery" Receivable,
(vi) which is an "account" within the meaning of Section 9-102(a)(2)
of the UCC of all applicable jurisdictions,
(vii) which is denominated and payable only in United States dollars
in the United States,
(viii) which arises under a Contract 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,
(ix) which arises under a Contract which (A) does not require the
Obligor under such Contract to consent to the transfer, sale, pledge or
assignment of the rights and duties of the Originator or any of its
assignees under such Contract and (B) does not contain a confidentiality
provision that purports to restrict the ability of the Agent to exercise
its rights under this Agreement, including, without limitation, its right
to review the Contract,
(x) which arises under a Contract that contains an obligation to pay
a specified sum of money, contingent only upon the sale of goods or the
provision of services by the Originator,
(xi) 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,
(xii) which satisfies all applicable requirements of the Credit and
Collection Policy,
(xiii) which was generated in the ordinary course of the
Originator's business,
(xiv) which arises solely from the sale of goods or the provision of
services to the related Obligor by the Originator, and not by any other
Person (in whole or in part),
(xv) as to which the Agent has not notified the Seller that the
Agent has determined in its reasonable credit judgment 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,
-8-
(xvi) which is not subject to any dispute, counterclaim, right of
rescission, setoff, counterclaim or any other defense (including defenses
arising out of violations of usury laws) of the applicable Obligor
against the Originator or any other Adverse Claim, and the Obligor
thereon holds no right as against such Originator to cause such
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); provided, however, that if
such dispute, offset, counterclaim or defense affects only a portion of
the Outstanding Balance of such Receivable, then such Receivable may be
deemed an Eligible Receivable to the extent of the portion of such
Outstanding Balance which is not so affected, and provided, further, that
Receivables of any Obligor which has any accounts payable by the
Originator or by a wholly-owned Subsidiary of such Originator (thus
giving rise to a potential offset against such Receivables) may be
treated as Eligible Receivables to the extent that the Obligor of such
Receivables has agreed pursuant to a written agreement in form and
substance satisfactory to the Agent, that such Receivables shall not be
subject to such offset,
(xvii) as to which the 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 (except for Progress Billed Receivables and then only
to the extent provided in the definition herein of such term),
(xviii) as to which each of the representations and warranties
contained in applicable to such Receivable is true and correct,
(xix) all right, title and interest to and in which has been validly
transferred by the Originator directly to the Seller under and in
accordance with the Receivables Sale Agreement, and the Seller has good
and marketable title thereto free and clear of any Adverse Claim, and
(xx) if the Obligor of which is a state or municipal government,
governmental subdivision or agency, the aggregate Outstanding Balance of
which when added to the aggregate Outstanding Balance of all Eligible
Receivables the Obligors of which are state or municipal governments,
governmental subdivisions or agencies, would not exceed 2% of the Net
Pool Balance.
"ERISA" -- The Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"ERISA Affiliate" -- Any trade or business (whether or not incorporated)
under common control with Guarantor or Vitro America within the meaning of
Section 414(b) or (c) of the Tax Code (and Sections 414(m) and (o) of the Tax
Code for purposes of provisions relating to Section 412 of the Tax Code).
-9-
"ERISA Event" -- (i) a Reportable Event; (ii) a withdrawal by Vitro
America or any ERISA Affiliate from a Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as defined in
Section 4001(a)(2) of ERISA) or a cessation of operations which is treated as
such a withdrawal under Section 4062(e) of ERISA; (iii) a complete or partial
withdrawal by the Performance Guarantor or Vitro America or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan
is in reorganization; (iv) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (v) an event or condition which might reasonably
be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension
Plan or Multiemployer Plan; or (vi) the imposition of any liability under
Title IV of ERISA, other than PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon the Performance Guarantor or Vitro America or any
ERISA Affiliate.
"Event of Bankruptcy" -- Shall be deemed to have occurred with respect to
a Person if either:
(i) a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding up,
or composition or readjustment of debts of such Person, the appointment
of a trustee, receiver, custodian, liquidator, assignee, sequestrator or
the like for such Person or all or substantially all of its assets, or
any similar action with respect to such Person under any law relating to
bankruptcy, insolvency, reorganization, winding up or composition or
adjustment of debts, and such case or proceeding shall continue
undismissed, or unstayed and in effect, for a period of 60 consecutive
days; or an order for relief in respect of such Person shall be entered
in an involuntary case under the federal bankruptcy laws or other similar
laws now or hereafter in effect; or
(ii) such Person shall commence a voluntary case or other proceeding
under any applicable bankruptcy, insolvency, reorganization, debt
arrangement, dissolution or other similar law now or hereafter in effect,
or shall consent to the appointment of or taking possession by a
receiver, liquidator, assignee, trustee (other than a trustee under a
deed of trust, indenture or similar instrument), custodian, sequestrator
(or other similar official) for, such Person or for any substantial part
of its property, or shall make any general assignment for the benefit of
creditors, or shall be adjudicated insolvent, or admit in writing its
inability to pay its debts generally as they become due, or, if a
corporation or similar entity, its board of directors shall vote to
implement any of the foregoing.
"Facility Account" -- The Seller's account no. 721780.1 at LaSalle Bank
National Association.
"Facility Termination Date" -- The earlier of (i) the Liquidity
Termination Date and (ii) the Amortization Date.
-10-
"Federal Bankruptcy Code" -- Title 11 of the United States Code entitled
"Bankruptcy," as amended and any successor statute thereto.
"Federal Funds Rate" means for any day the greater of (i) the average
rate per annum as determined by ABN AMRO at which overnight Federal funds are
offered to ABN AMRO for such day by major banks in the interbank market, and
(ii) if ABN AMRO is borrowing overnight funds from a Federal Reserve Bank that
day, the average rate per annum at which such overnight borrowings are made on
that day. Each determination of the Federal Funds Rate by ABN AMRO shall be
conclusive and binding on the Seller except in the case of manifest error.
"Fee Letter" -- That certain letter agreement dated as of even date
herewith among the Seller, Vitro America, the Conduit and the Agent, as it may
be amended, restated or otherwise modified and in effect from time to time.
"Finacity" -- Finacity Corporation.
"Final Payout Date" -- The date on which all Aggregate Unpaids have been
paid in full and the Purchase Limit has been reduced to zero.
"Finance Charges" -- With respect to a Contract, any finance, interest,
late payment charges or similar charges owing by an Obligor pursuant to such
Contract.
"Form Progress Billed Receivable Contract" -- A Contract in substantially
the form of the Standard Form of Agreement Between Contractor and
Subcontractor by The American Institute of Architects.
"Funding Agreement" -- (i) this Agreement, (ii) the Liquidity Agreement
and (iii) any other agreement or instrument executed by any Funding Source
with or for the benefit of the Conduit.
"Funding Source" -- (i) any Committed Purchaser or (ii) any insurance
company, bank or other funding entity providing liquidity, credit enhancement
or back-up purchase support or facilities to the Conduit.
"GAAP" -- At any time, generally accepted accounting principles in effect
in the United States of America at such time.
"Governmental Authority" -- Any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any body or entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, any court or arbitrator and any accounting board or authority
(whether or not a part of government) which is responsible for the
establishment or interpretation of national or international accounting
principles, in each case whether foreign or domestic.
"Incremental Purchase" -- As defined in Section 1.1(b).
-11-
"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.
"Indemnified Amounts" -- As defined in Section 10.1(a).
"Indemnified Party" -- As defined in Section 10.1(a).
"Independent Director" -- A Person who is a director of the Seller who is
not at such time, and has not been at any time during the preceding five (5)
years: (i) a creditor, supplier, director, officer, employee, family member,
manager, member, limited partner, partner or contractor of Vitro America,
Performance Guarantor, the Originator or any of their respective Subsidiaries
or Affiliates (other than Seller), (ii) a direct or indirect or beneficial
owner, excluding de minimus ownership interests, (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, Vitro America, Performance Guarantor, the Originator, or any
of their respective Subsidiaries or Affiliates, having general voting rights,
or (iii) a person who controls (whether directly, indirectly or otherwise)
Vitro America, Performance Guarantor, the Originator or any of their
respective Subsidiaries or Affiliates (other than Seller) or any creditor,
supplier, employee, officer, director, manager, member, limited partner,
partner or contractor of Vitro America, Performance Guarantor, the Originator
or any of their respective Subsidiaries or Affiliates (other than Seller).
"Intercreditor Agreement" -- That certain Intercreditor Agreement, dated
as of May 7, 2004, by and between the Agent and Bank of America, N.A., as
acknowledged by the Seller and Vitro America.
"Invested Amount" -- Of any Receivable Interest means, at any time, (i)
the Purchase Price of such Receivable Interest, minus (ii) the sum of the
aggregate amount of Collections and other payments received by the Agent which
in each case are applied to reduce such Invested Amount in accordance with the
terms and conditions of this Agreement; provided that such Invested Amount
shall be restored (in accordance with Section 2.7) 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.
"Investment Report" -- Any Daily Report, Weekly Report or Monthly Report,
as the case may be.
"LIBO Rate" -- For any Tranche Period for a LIBO Rate Tranche or other
time period, the rate per annum (rounded upwards, if necessary, to the next
higher one hundred-thousandth of
-12-
a percentage point) for deposits in Dollars for a period equal to such Tranche
Period or other period, (a) which appears on Page 3750 of the Telerate Service
(or any successor page or successor service that displays the British Bankers'
Association Interest Settlement Rates for Dollar deposits) as of 11:00 a.m.
(London, England time) two Business Days before the commencement of such
Tranche Period or other period or (b) if for any Tranche Period for a LIBO
Rate Tranche no such displayed rate is available (or, for any other period, if
such displayed rate is not available or the need to calculate the LIBO Rate is
not notified to the Agent at least 3 Business Days before the commencement of
the period for which it is to be determined), as determined by the Agent based
on the rates ABN AMRO is offered deposits of such duration in the London
interbank market, in each case, divided by (i) one (1) minus the maximum
aggregate reserve requirement (including all basic, supplemental, marginal or
other reserves) which is imposed against the Agent in respect of Eurocurrency
liabilities, as defined in Regulation D of the Board of Governors of the
Federal Reserve System as in effect from time to time (expressed as a
decimal), applicable to such Tranche Period plus (ii) the Applicable Margin.
"Liquidity Agreement" -- That certain Transfer Agreement dated as of even
date herewith, by and among the Conduit, the Agent and the banks from time to
time party thereto, as the same may be amended, restated and/or otherwise
modified from time to time in accordance with the terms thereof.
"Liquidity Termination Date" -- The earliest to occur of the following:
(a) the date of the occurrence of an Amortization Event described in
Section 9.1(f);
(b) the date designated by the Agent to the Seller at any time after
the occurrence of any other Amortization Event;
(c) the Business Day designated by the Seller with no less than five
(5) Business Days prior notice to the Agent; or
(d) May 6, 2005.
"Lock-Box" -- 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 hereto.
"Loss Reserve" -- For any Calculation Period, the greater of (x) 12.0%
and (y) the product (expressed as a percentage) of (i) 2.0, times (ii) the
highest three (3)-month rolling average Default Reserve Ratio during the
twelve (12) Calculation Periods ending on the related Cut-Off Date, times
(iii) the Default Horizon Ratio as of the related Cut-Off Date.
"Loss-to-Liquidation Ratio" -- For any Calculation Period, a fraction
(expressed as a percentage), the numerator of which is the Outstanding Balance
of Receivables as to which any payment or part thereof, remained unpaid for
121 days or more but less than 151 days from the
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original due date for such payment during all or any portion of such
Calculation Period, and the denominator of which is the aggregate amount of
Collections during such Calculation Period.
"Material Adverse Effect" -- A material adverse effect on (i) the
financial condition or operations of the Performance Guarantor, any Seller
Party and each of their respective Subsidiaries, taken as a whole, (ii) the
ability of any Seller Party to perform its obligations under this Agreement,
or Originator to perform its obligations under the Sale Agreement or the
Performance Guarantor to perform its obligations under the Performance
Undertaking, (iii) the legality, validity or enforceability of this Agreement
or any other Transaction Document, (iv) the Agent's security interest, for the
benefit of the Secured Parties, in the Receivables generally or in any
material 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.
"Material Indebtedness"-- As defined in Section 9.1(e).
"Matured Aggregate Invested Amount" -- At any time, the Matured Value of
the Conduit's Invested Amount plus the total Invested Amounts of all other
Purchasers then outstanding.
"Matured Value" -- Of any Invested Amount, the sum of such Invested
Amount and all unpaid Yield scheduled to become due (whether or not then due)
on such Invested Amount during all Tranche Periods to which any portion of
such Investment has been allocated.
"Monthly Report" -- A report, in substantially the form of Exhibit XIII
hereto (appropriately completed), furnished by the Servicer to the Agent
pursuant to Section 8.5.
"Monthly Reporting Date" -- (i) The 15th calendar of each month after the
date of this Agreement, of if such day is not a Business Day, the next
succeeding Business Day and (ii) such other days of the month as Agent may
request in connection with Section 8.5.
"Moody's" -- ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" -- A "multiemployer plan", within the meaning of
Section 4001(a)(3) of ERISA, to which Originator or any ERISA Affiliate makes,
is making, or is obligated to make contributions or, during the preceding
three calendar years, has made, or been obligated to make, contributions.
"NDC" -- National Data Communications.
"Net Pool Balance" -- 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 Obligor Concentration Limit for such Obligor.
"Net Worth"-- As defined in the Receivables Sale Agreement.
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"Obligations" -- As defined in Section 2.3.
"Obligor" -- A Person obligated to make payments pursuant to a Contract.
"Obligor Concentration Limit" -- At any time, in relation to the
aggregate Outstanding Balance of Receivables owed by any single Obligor and
its Affiliates (if any), the applicable concentration limit shall be
determined as follows for Obligors who have short term unsecured debt ratings
currently assigned to them by S&P and Moody's (or in the absence thereof, the
equivalent long term unsecured senior debt ratings), the applicable
concentration limit shall be determined according to the following table:
-------------------------------------------------------------------------------
ALLOWABLE % OF
ELIGIBLE
S&P RATING ▇▇▇▇▇'▇ RATING RECEIVABLES
-------------------------------------------------------------------------------
A-1+ P-1 10%
-------------------------------------------------------------------------------
A-1 P-1 8%
-------------------------------------------------------------------------------
A-2 P-2 6%
-------------------------------------------------------------------------------
A-3 P-3 3%
-------------------------------------------------------------------------------
Below A-3 or Not Rated by Below P-3 or Not Rated by 2.4%
either S&P or Moody's either S&P or Moody's
-------------------------------------------------------------------------------
; provided, however, that (i) if any Obligor has a split rating, the
applicable rating will be the lower of the two, (ii) if any Obligor is not
rated by either S&P or Moody's, the applicable Obligor Concentration Limit
shall be the one set forth in the last line of the table above, and (iii)
subject to an increase in the percentage set forth in clause (i)(A) of the
definition of "Required Reserve," upon the Seller's request from time to time,
the Agent may agree to a higher percentage of Eligible Receivables for a
particular Obligor and its Affiliates or class of Receivables (each such
higher percentage, a "Special Concentration Limit"), it being understood that
any Special Concentration Limit may be canceled by the Agent upon not less
than five (5) Business Days' written notice to the Seller Parties.
"Organizational Documents" -- For any Person, the documents for its
formation and organization, which, for example, (i) for a corporation are its
certificate or articles of incorporation and bylaws, (ii) for a partnership
are its certificate of partnership (if applicable) and partnership agreement,
(iii) for a limited liability company are its certificate of formation or
organization and its operating agreement, regulations or the like and (iv) for
a trust is the trust agreement, declaration of trust, indenture or bylaws
under which it is created.
"Originator" -- Vitro America , in its capacity as a seller under the
Receivables Sale Agreement.
"Other Costs" -- As defined in Section 10.3.
"Other Customers" -- As defined in Section 10.4.
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"Other Depositary Account" -- Each deposit account, excluding each Bank
of America Depositary Account, established by the Originator for the deposit
of Collections. Each such Other Depositary Account shall be listed on Exhibit
IV hereto.
"Outstanding Balance" -- Of any Receivable at any time means the then
outstanding principal balance thereof net of any unapplied discounts set forth
under and pursuant to the terms of the related Contract.
"Participant" -- As defined in Section 12.2.
"PBGC" -- The Pension Benefit Guaranty Corporation, or any successor
thereto.
"Pension Plan" -- A pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA, other than a Multiemployer Plan, which Vitro
America or Performance Guarantor sponsors or maintains, or to which it makes,
is making, or is obligated to make contributions, or in the case of a multiple
employer plan (as described in Section 4064(a) of ERISA) has made
contributions at any time during the immediately preceding five (5) plan
years.
"Performance Guarantor"-- Vitro Plan S.A. de CV.
"Performance Undertaking" -- That certain Performance Undertaking, dated
as of even date herewith, by Performance Guarantor in favor of the Seller,
substantially in the form of Exhibit XI hereto, as the same may be amended,
restated or otherwise modified from time to time.
"Permitted Investments" -- (a) evidences of indebtedness, maturing not
more than thirty (30) days after the date of purchase thereof, issued by, or
the full and timely payment of which is guaranteed by, the full faith and
credit of, the federal government of the United States of America; (b)
repurchase agreements with banking institutions or broker-dealers that are
registered under the Securities Exchange Act of 1934 fully secured by
obligations of the kind specified in clause (a) above; (c) money market funds
denominated in Dollars rated not lower than A-1+ (and without the "r" symbol
attached to any such rating) by S&P and P-1 by Moody's or otherwise acceptable
to the Rating Agencies; or (d) commercial paper denominated in Dollars issued
by any corporation incorporated under the laws of the United States or any
political subdivision thereof, provided that such commercial paper is rated at
least A-1+ (and without any "r" symbol attached to any such rating) thereof by
S&P and at least Prime-1 thereof by Moody's.
"Person" -- 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.
"Plan" -- An employee benefit plan (as defined in Section 3(3) of ERISA)
which Performance Guarantor or any of its ERISA Affiliates sponsors or
maintains or to which Performance Guarantor or any of its ERISA Affiliates
makes, is making, or is obligated to make contributions and includes any
Pension Plan, other than a Plan maintained outside the United States primarily
for the benefit of Persons who are not U.S. residents.
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"Post-Office Box" -- Any United States Postal Service post office box
into which Collections are deposited. Each Post-Office Box shall be listed on
Exhibit XVI and such exhibit shall include the number of such Post-Office Box,
the address of such Post-Office Box, the address of the post office at which
such Post-Office Box is located.
"Postal Direction Letter" -- A direction letter in substantially the form
of Exhibit XV, executed by the Originator and/or the Seller instructing the
post office to follow the instructions of the Agent with respect to each post
office box to which Collections are remitted.
"Postal Power of Attorney" -- A power of attorney in substantially the
form of Exhibit XIV, executed by the Originator and/or the Seller in favor of
the Agent with respect to each post office box to which Collections are
remitted.
"Power of Attorney" -- As defined in Section 13.12(c).
"Prime Rate" -- For any period, the daily average during such period of
(a) the greater of (i) the floating commercial loan rate per annum of ABN AMRO
(which rate is a reference rate and does not necessarily represent the lowest
or best rate actually charged to any customer by ABN AMRO) announced from time
to time as its prime rate or equivalent for Dollar loans in the USA, changing
as and when said rate changes and (ii) the Federal Funds Rate plus 0.75% plus
(b) the Applicable Margin.
"Progress Billed Receivable" -- Any Receivable which arises from the
Originator's provision of a portion of the good or services required to be
provided by such Originator in connection with a particular construction or
installation project and which meets all of the criteria herein for being an
"Eligible Receivable" except that such Originator has not completed such
project in its entirety; provided, however, that any Receivables status as a
"Progress Billed Receivable" may be canceled by the Agent at any time.
"Proposed Reduction Date" -- As defined in Section 1.3.
"Purchase"-- An Incremental Purchase or a Reinvestment.
"Purchase Date" -- Each Business Day on which a Purchase is made
hereunder.
"Purchase Limit" -- $40,000,000.
"Purchase Notice" -- As defined in Section 1.2.
"Purchase Price" -- With respect to any Incremental Purchase of a
Receivable Interest, the amount requested by the Seller in the applicable
Purchase Notice; provided that such Purchase Price shall not exceed the amount
available for an Incremental Purchase pursuant to Section 1.2.
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"Purchased Assets" -- All of the Seller's right, title and interest,
whether now owned and existing or hereafter arising in and to all of the
Receivables, the Related Security, the Collections and all proceeds of the
foregoing.
"Purchasers"-- The Committed Purchasers and the Conduit.
"Ratable Share"-- Is defined in the Liquidity Agreement.
"Rating Agency" -- Moody's, S&P and any other rating agency the Conduit
chooses to rate its Commercial Paper.
"Ratings" -- The ratings by the Rating Agencies of the indebtedness for
borrowed money of the Conduit.
"Receivable" -- All indebtedness and other obligations owed to the Seller
or the Originator (at the time it arises, and before giving effect to any
transfer or conveyance under the Receivables Sale Agreement) or in which the
Seller or the 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 of goods or the rendering of services by such
Originator, and further includes, without limitation, the obligation to pay
any Finance Charges with respect thereto. 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, further, that any indebtedness, rights or obligations
referred to in the immediately preceding sentence shall be a Receivable
regardless of whether the account debtor or the Seller treats such
indebtedness, rights or obligations as a separate payment obligation.
"Receivable Interest" -- At any time, an undivided percentage ownership
interest (computed as set forth below) associated with a designated amount of
Invested Amount, 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:
IA + RR
-----------------
NPB
where:
IA = the Invested Amount of such Receivable Interest.
NPB = the Net Pool Balance.
RR = the Required Reserve.
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Such undivided percentage ownership interest shall be initially computed on
its date of purchase. Thereafter, until the Facility Termination Date, each
Receivable Interest shall be automatically recomputed (or deemed to be
recomputed) on each day prior to the Facility Termination Date. The variable
percentage represented by any Receivable Interest as computed (or deemed
recomputed) as of the close of the business day immediately preceding the
Facility Termination Date shall remain constant at all times thereafter.
"Receivables Sale Agreement" -- That certain Receivables Sale Agreement,
dated as of even date herewith, among the Originators and the Seller, as the
same may be amended, restated or otherwise modified from time to time.
"Records" -- 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.
"Reduction Notice" -- As defined in Section 1.3.
"Register" -- As defined in Section 12.1(b).
"Regulatory Change" -- As defined in Section 10.2.
"Reinvestment" -- As defined in Section 2.2(a).
"Related Security" -- All of the Seller's right, title and interest in,
to and under the Performance Undertaking and with respect to any Receivable
all of the Seller's interest in:
(i) the inventory and goods (including returned or repossessed
inventory or goods), if any, the sale of which by the Originator gave
rise to such Receivable, and all insurance contracts with respect
thereto,
(ii) all other security interests or liens and property subject
thereto from time to time, if any, purporting to secure payment of such
Receivable, whether pursuant to the Contract related to such Receivable
or otherwise, together with all financing statements and security
agreements describing any collateral securing such Receivable,
(iii) all guaranties, letters of credit, insurance 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) all service contracts and other contracts and agreements
associated with such Receivable,
(v) all of the Seller's right, title and interest in, to and under
the Receivables Sale Agreement in respect of such Receivable and each
post-office box and account
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containing Collections, including without limitation, the Lock-Boxes and
the Collection Accounts, and
(vi) all proceeds of any of the foregoing.
"Required Capital Amount"-- As defined in the Receivables Sale Agreement.
"Required Committed Purchasers" -- At any time, Committed Purchasers with
Liquidity Commitments in excess of 50% of the aggregate amount of all
Liquidity Commitments.
"Required Notice Period" -- The number of days required notice set forth
below applicable to the Aggregate Reduction or Clean Up Call indicated below:
Aggregate Reduction Required Notice Period
less than 25% of the Purchase Limit Two (2) Business Days
greater than 25% of the Purchase Limit Five (5) Business Days
"Required Reserve" -- On any day during a Calculation Period, the product
of (i) the greater of (A) the Required Reserve Factor Floor and (B) the sum of
the Loss Reserve, the Yield Reserve, the Dilution Reserve and the Servicing
Reserve, times (ii) the Net Pool Balance as of the Cut-Off Date immediately
preceding such Calculation Period.
"Required Reserve Factor Floor" -- At any time, an amount, expressed as a
percentage, equal to the sum of (i) the product of (x) 5 and (y) the lowest
Obligor Concentration Limit then in effect, plus (ii) the product of (x) the
Adjusted Dilution Ratio and (y) the Dilution Horizon Ratio as most recently
computed.
"Restricted Junior Payment" -- (i) any dividend or other distribution,
direct or indirect, on account of any shares of any class of capital stock of
the 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 the 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 the 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 with respect to the Subordinated
Loans, (iv) 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 the Seller now or hereafter
outstanding, and (v) any payment of management fees by the Seller (except for
reasonable management fees to the Originator or its respective Affiliates in
reimbursement of actual management services performed).
"Review" -- As defined in Section 7.1(d)(ii).
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"S&P" -- Standard and Poor's Ratings Services, a division of The
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Secured Parties" -- The Conduit, the Agent, the Committed Purchasers and
their respective successors and assigns.
"Selected Depositary Account" -- Each of (i) account number 0000293253
maintained with AmSouth Bank (Birmingham, AL), (ii) account number 90000385003
maintained with AmSouth Bank (Metairie, LA), (iii) account number 5002070430
maintained with AmSouth Bank (Jackson, MS), (iv) account number 816030706
maintained with Hibernia National Bank (Shreveport, LA) or (v) account number
▇▇▇▇▇▇▇▇ maintained with Union Planters Bank (Grenada, MS). Each such Selected
Depositary Account shall be listed on Exhibit IV hereto.
"Seller" -- As defined in the preamble to this Agreement.
"Seller Parties" -- As defined in the preamble to this Agreement.
"Servicer" -- At any time the Person (which may be the Agent) then
authorized pursuant to Article VIII to service, administer and collect
Receivables.
"Servicing Fee" -- For each day in a Calculation Period:
(i) an amount equal to (A) the Servicing Fee Rate (or, at any time
while Vitro America or one of its Affiliates is the Servicer, such lesser
percentage as may be agreed between the Seller and the Servicer on an
arms' length basis based on then prevailing market terms for similar
services), times (B) the aggregate Outstanding Balance of all Receivables
at the close of business on the Cut-Off Date immediately preceding such
Calculation Period, times (C) 1/360; or
(ii) on and after the Servicer's reasonable request made at any time
when Vitro America or one of its Affiliates is no longer acting as
Servicer hereunder, an alternative amount specified by the successor
Servicer not exceeding (A) 110% of such Servicer's reasonable costs and
expenses of performing its obligations under this Agreement during the
preceding Calculation Period, divided by (B) the number of days in the
current Calculation Period.
"Servicing Fee Rate" -- 1.0% per annum.
"Servicing Reserve" -- For any Calculation Period, the product (expressed
as a percentage) of (i) the Servicing Fee Rate, times (ii) a fraction, the
numerator of which is the highest three-month average Turnover Reserve Ratio
for the most recent twelve (12) Calculation Periods and the denominator of
which is 360.
"Settlement Date" -- (i) the second (2nd) Business Day after each Monthly
Reporting Date, and (ii) the last day of the relevant Tranche Period in
respect of each Receivable Interest held by the Committed Purchasers.
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"Settlement Period" -- (i) in respect of each Receivable Interest funded
through the issuance of Commercial Paper, the immediately preceding
Calculation Period, and (ii) in respect of each Receivable Interest held by
the Committed Purchasers, the entire related Tranche Period.
"Special Transaction Subaccount" -- The special transaction subaccount
established for this Agreement pursuant to the Conduit's depository agreement.
"Subordinated Loan"-- As defined in the Receivables Sale Agreement.
"Subordinated Note"-- As defined in the Receivables Sale Agreement.
"Subservicing Agreement" -- That certain Subservicing Agreement dated as
of May 7, 2004, among Finacity and the Servicer.
"Subservicer Fee"-- As defined in the Subservicing Agreement.
"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.
"Tax Code" -- The Internal Revenue Code of 1986, as the same may be
amended from time to time.
"Tranche" -- A portion of the Investment Amount allocated to a Tranche
Period.
"Tranche Period" -- A period of days ending on a Business Day selected
pursuant to Section 1.3, which (i) for a CP Tranche shall not exceed 270 days,
(ii) for a LIBO Rate Tranche shall not exceed one, two, three or six months,
and (iii) for a Prime Tranche shall not exceed 30 days.
"Transaction Documents" -- Collectively, this Agreement, each Purchase
Notice, the Receivables Sale Agreement, each Collection Account Agreement, the
Fee Letter, the Intercreditor Agreement, the Subordinated Note, the
Subservicing Agreement and all other instruments, documents and agreements
executed and delivered in connection herewith.
"Turnover Ratio" -- With respect to any Calculation Period, an amount,
expressed in days, obtained by multiplying (a) a fraction, (i) the numerator
of which is equal to the aggregate Outstanding Balance of Receivables on the
first day of such Calculation Period and (ii) the denominator of which is
equal to Collections on the Receivables during such Calculation Period by (b)
30.
"Turnover Reserve Ratio" -- With respect to any Calculation Period, an
amount, expressed in days, obtained by multiplying (a) a fraction, (i) the
numerator of which is equal to
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the aggregate Outstanding Balance of the Eligible Receivables on the first day
of such Calculation Period and (ii) the denominator of which is equal to
Collections on the Eligible Receivables during such Calculation Period by (b)
30.
"UCC" -- The Uniform Commercial Code as from time to time in effect in
the specified jurisdiction.
"Unmatured Amortization Event" -- An event which, with the passage of
time or the giving of notice, or both, would constitute an Amortization Event.
"Vitro America" -- As defined in the preamble.
"Voluntary Termination" -- The occurrence of an Amortization Event
resulting from the occurrence of the "Termination Date" pursuant to subclause
(iv) of the definition of "Termination Date" in the Receivables Sale
Agreement.
"Voting Shares" -- With respect to any Person, any class or classes of
capital stock or other ownership interest pursuant to which the holders
thereof have the general voting power under ordinary circumstances to elect
directors, manager or trustees of such Person (irrespective of whether or not,
at the time, stock of any other class or classes has, or might have, voting
power by reason of the happening of any contingency).
"Weekly Report" -- A report, in substantially the form of Exhibit IX
hereto (appropriately completed), furnished by the Servicer to the Agent
pursuant to Section 8.5.
"Weekly Reporting Date" -- (i) The second Business Day of each week
(other than any week during which a Monthly Reporting Date occurs) after the
date of this Agreement and (ii) such other days of any week as Agent may
request in connection with Section 8.5 hereof.
"Yield" -- For each Tranche Period relating to a Receivable Interest held
by the Committed Purchasers, an amount equal to the product of the applicable
Yield Rate for such Receivable Interest multiplied by the Invested Amount of
such Receivable Interest for each day elapsed during such Tranche Period,
annualized on a 360 day basis.
"Yield Rate" -- With respect to each Receivable Interest held by the
Committed Purchasers, the LIBO Rate, the Prime Rate or the Default Rate, as
applicable.
"Yield Reserve" -- For any Calculation Period, the product (expressed as
a percentage) of (i) 1.5 times (ii) the Prime Rate as of the related Cut-Off
Date times (iii) a fraction the numerator of which is the highest three month
average Turnover Reserve Ratio for the most recent twelve (12) Calculation
Periods and the denominator of which is 360.
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.
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