Inter-City Products Corporation (USA)
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RECEIVABLES PURCHASE AGREEMENT
dated as of July 25,1996
among
INTER-CITY PRODUCTS CORPORATION (USA)
and
CERTAIN SUBSIDIARIES,
as Sellers
INTER-CITY PRODUCTS PARTNER CORPORATION,
and
INTER-CITY PRODUCTS RECEIVABLES COMPANY, L.P.
as Buyer
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TABLE OF CONTENTS
Page
ARTICLE I
AGREEMENT TO PURCHASE AND SELL
SECTION 1.1 Agreement to Purchase and Sell 1
SECTION 1.2 Timing of Purchases 2
SECTION 1.3 Consideration for Purchases 2
SECTION 1.4 No Recourse 2
SECTION 1.5 No Assumption of Obligations Relating to Receivables,
Related Assets or Contracts 2
SECTION 1.6 True Sales 3
SECTION 1.7 Addition of Sellers 3
SECTION 1.8 Contribution of Receivables 4
ARTICLE II
CALCULATION OF PURCHASE PRICE
SECTION 2.1 Calculation of Purchase Price 6
SECTION 2.2 Definitions and Calculations Related to
Purchase Price Percentage 7
ARTICLE III
PAYMENT OF PURCHASE PRICE; SERVICING, ETC.
SECTION 3.1 Purchase Price Payments 8
SECTION 3.2 The Buyer Notes 11
SECTION 3.3 Application of Collections and Other Funds 11
SECTION 3.4 Servicing of Receivables and Related Assets 12
SECTION 3.5 Adjustments for Noncomplying Receivables and Dilution 12
SECTION 3.6 Payments and Computations, Etc 12
ARTICLE IV
CONDITIONS TO PURCHASES
SECTION 4.1 Conditions Precedent to Initial Purchase 13
SECTION 4.2 Certification as to Representations and Warranties 14
SECTION 4.3 Effect of Payment of Purchase Price 14
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ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.1 Representations and Warranties of the Sellers 15
SECTION 5.2 Representations and Warranties of Buyer 20
ARTICLE VI
GENERAL COVENANTS OF THE SELLERS
SECTION 6.1 Affirmative Covenants 21
SECTION 6.2 Reporting Requirements 24
SECTION 6.3 Negative Covenants 25
ARTICLE VII
ADDITIONAL RIGHTS AND OBLIGATIONS IN
RESPECT OF THE SPECIFIED ASSETS
SECTION 7.1 Rights of Buyer 28
SECTION 7.2 Responsibilities of the Sellers 29
SECTION 7.3 Further Action Evidencing Purchases 29
SECTION 7.4 Collection of Receivables; Rights of Buyer
and Its Assignees 30
ARTICLE VIII
TERMINATION
SECTION 8.1 Automatic Termination 31
ARTICLE IX
INDEMNIFICATION
SECTION 9.1 Indemnities by the Sellers 32
ARTICLE X
MISCELLANEOUS
SECTION 10.1 Amendments; Waivers, Etc 34
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SECTION 10.2 Notices, Etc 34
SECTION 10.3 Cumulative Remedies 34
SECTION 10.4 Binding Effect; Assignability; Survival of Provisions 35
SECTION 10.5 Governing Law 35
SECTION 10.6 Costs, Expenses and Taxes 35
SECTION 10.7 Submission to Jurisdiction 36
SECTION 10.8 Waiver of Jury Trial 36
SECTION 10.9 Integration 36
SECTION 10.10 Counterparts 37
SECTION 10.11 Acknowledgment and Consent 37
SECTION 10.12 No Partnership or Joint Venture 37
SECTION 10.13 No Proceedings 37
SECTION 10.14 Severability of Provisions 38
SECTION 10.15 Recourse to Buyer 38
EXHIBITS
EXHIBIT A Form of Buyer Note
EXHIBIT B Form of Seller Assignment Certificate
SCHEDULES
SCHEDULE 1 Litigation and Other Proceedings
SCHEDULE 2 Changes in Financial Condition
SCHEDULE 3 Offices of the Sellers where Records are Maintained
SCHEDULE 4 Legal Names, Trade Names and Names Under Which the
Companies Do Business
SCHEDULE 5 Software Programs and Licenses
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This RECEIVABLES PURCHASE AGREEMENT, dated as of July 25, 1996
(this "Agreement"), is made among INTER-CITY PRODUCTS CORPORATION (USA),
a Delaware corporation ("ICP"), INTER-CITY PRODUCTS PARTNER CORPORATION,
a Delaware corporation ("ICPPC"), certain direct or indirect domestic
subsidiaries of ICP that are listed on the signature pages hereto or that
become party hereto in accordance with the terms hereof (together with ICP
and ICPPC, the "Sellers"), and INTER-CITY PRODUCTS RECEIVABLES COMPANY,
L.P., a Tennessee limited partnership ("Buyer").
Pursuant to the Pooling and Servicing Agreement dated as of the
date hereof (as amended, supplemented or otherwise modified from time to
time, the "Pooling Agreement"), Buyer intends to transfer its interests
in the Receivables sold pursuant hereto, together with Receivables
contributed to Buyer by ICP and ICPPC from time to time, to the Trust in
order to, among other things, finance its purchases hereunder. Except as
otherwise defined herein, capitalized terms have the meanings assigned to
them in Appendix A to the Pooling Agreement, and this Agreement shall be
interpreted in accordance with the conventions set forth in Part B of such
Appendix A.
NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, agree as follows:
ARTICLE I
AGREEMENT TO PURCHASE AND SELL
SECTION 1.1 Agreement to Purchase and Sell. Each Seller hereby
sells, transfers, assigns, sets over and conveys to Buyer, and Buyer
agrees to purchase from each Seller, at the times set forth in Section
1.2, all of such Seller's right, title and interest in, to and under:
(a) all Receivables of such Seller (other than
Contributed Initial Receivables) that existed and were owing to such
Seller as at the closing of such Seller's business on the Initial Cut-Off
Date,
(b) all Receivables created by such Seller (other than
Contributed Subsequent Receivables) that arise during the period from and
including the closing of such Seller's business on the Initial Cut-Off
Date to but excluding the Purchase Termination Date,
(c) all Related Security with respect to such
Receivables of such Seller,
(d) all proceeds of the foregoing, including all funds
received by any Person in payment of any amounts owed (including invoice
prices, finance charges, interest and all other charges, if any) in
respect of any Receivable described above or Related Security with respect
to any such Receivable, or otherwise applied to repay or discharge any
such Receivable (including insurance payments that a Seller or the
Servicer applies in the ordinary course of its business to amounts owed
in respect of any such Receivable and net proceeds of any sale or
other disposition of repossessed goods that were the subject of any such
Receivable) or other collateral or property of any Obligor or any other
party directly or indirectly liable for payment of such Receivables, and
(e) all Records relating to any of the foregoing.
As used herein, (i) "Purchased Receivables" means the items listed
above in clauses (a) and (b), (ii) "Related Purchased Assets" means the
items listed above in clauses (c), (d) and (e), (iii) "Related Assets"
means the Related Purchased Assets and the Related Contributed Assets,
(iv) "Purchased Assets" means the Purchased Receivables and the Related
Purchased Assets, (v) "Specified Assets" means the Purchased Receivables,
the Contributed Receivables and the Related Assets and (vi) "Specified
Receivables" means the Purchased Receivables and the Contributed
Receivables.
SECTION 1.2 Timing of Purchases.
(a) Initial First Issuance Date Purchases. All of the
Purchased Assets of each Seller that existed at the closing of such
Seller's business on the Initial Cut-Off Date shall be sold automatically
to Buyer on the First Issuance Date.
(b) Regular Purchases. Except to the extent otherwise
provided in Section 8.1, after the closing of a Seller's business on the
Initial Cut-Off Date until the closing of such Seller's business on the
Business Day immediately preceding the Purchase Termination Date, all
Purchased Receivables and the Related Purchased Assets of each Seller
shall be sold automatically to Buyer pursuant hereto immediately (and
without further action by any Person) upon the creation of the Purchased
Receivable or Related Purchased Asset.
SECTION 1.3 Consideration for Purchases. On the terms and
subject to the conditions set forth in this Agreement, Buyer agrees to
make Purchase Price payments to the Sellers in accordance with Article
III.
SECTION 1.4 No Recourse. Except as specifically provided in
this Agreement, the sale and purchase of Purchased Assets under this
Agreement shall be without recourse to the Sellers; it being understood
that (i) each Seller shall be liable to Buyer for all representations,
warranties, covenants and indemnities made by such Seller pursuant to the
terms of this Agreement, all of which obligations are limited so as not
to constitute recourse to such Seller for the credit risk of the Obligors,
and (ii) ICP shall be liable to Buyer to the extent specified in the
Seller Guaranty.
SECTION 1.5 No Assumption of Obligations Relating to
Receivables, Related Assets or Contracts. None of Buyer, any Servicer nor
the Trustee shall have any obligation or liability to any Obligor or other
customer or client of a Seller (including any obligation to perform any
of the obligations of such Seller under any Receivable, related Contracts
or any other related
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purchase orders or other agreements). No such obligation or liability is
intended to be assumed by Buyer, any Servicer or the Trustee hereunder,
and any assumption thereof is expressly disclaimed.
SECTION 1.6 True Sales. The Sellers and Buyer intend the
transfers of Receivables hereunder to be true sales (or, with respect to
Contributed Receivables, true conveyances) by the Sellers to Buyer that
are absolute and irrevocable and that provide Buyer with the full benefits
of ownership of the Receivables, and none of the Sellers nor Buyer intends
the transactions contemplated hereunder to be, or for any purpose to be
characterized as, loans from Buyer to any Seller. ICP and ICPPC intend
the transfers of Receivables by ICP to ICPPC to be true conveyances by ICP
to ICPPC that are absolute and irrevocable and that provide ICPPC with the
full benefits of ownership of such Receivables, and neither ICP nor ICPPC
intends the transactions contemplated hereunder to be, or for any purpose
to be characterized as, loans from ICPPC to ICP.
It is, further, not the intention of Buyer or any Seller that the
conveyance of the Specified Assets by a Seller be deemed a grant of a
security interest in the Specified Assets by such Seller to Buyer (or
ICPPC, as the case may be) to secure a debt or other obligation of such
Seller. However, in the event that, notwithstanding the intent of the
parties, any Specified Assets are property of any Seller's estate, then
(i) this Agreement also shall be deemed to be and hereby is a security
agreement within the meaning of the UCC, and (ii) the conveyance by such
Seller provided for in this Agreement shall be deemed to be a grant by
such Seller to Buyer (or ICPPC, as the case may be) of, and such Seller
hereby grants to Buyer (or ICPPC, as the case may be), a security interest
in and to all of such Seller's right, title and interest in, to and under
the Specified Assets to secure (1) the rights of Buyer (or ICPPC, as the
case may be) hereunder and (2) a loan by Buyer (or ICPPC, as the case may
be) to such Seller in the amount of the related Purchase Price of the
Purchased Assets sold by it or the Unpaid Balance of any Contributed
Receivables and the Related Contributed Assets, as the case may be. Each
Seller and Buyer shall, to the extent consistent with this Agreement, take
such actions as may be necessary to ensure that, if this Agreement were
deemed to create a security interest in the Specified Assets, such
security interest would be deemed to be a perfected security interest of
first priority (subject to Permitted Adverse Claims) in favor of Buyer (or
ICPPC, as the case may be) under applicable law and will be maintained as
such throughout the term of this Agreement.
SECTION 1.7 Addition of Sellers. ICP shall cause each
Subsidiary of ICP which originates any right of such Subsidiary to
payment, whether constituting an account, chattel paper, instrument,
general intangible or otherwise, arising from the sale of goods, services
or future services by such Subsidiary, to become a Seller hereunder
immediately upon such entity becoming a Subsidiary and shall cause such
Subsidiary to sell its accounts receivable and property of the types that
constitute Related Assets hereunder to Buyer. ICP and each Person that
will be added as a Subsidiary shall give to Buyer, the Trustee, the Rating
Agencies and each Required Person not less than 30 days' prior written
notice of the effective date of the addition
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of such Person as a Subsidiary. Once the notice has been given, the
Receivables given by any Subsidiary of ICP as a Seller added to this
Agreement pursuant to this section shall satisfy clause (n) of the
definition of "Eligible Receivables" on the first Business Day following
the expiration of the notice period (or such later date as may be
specified in the notice) on which (i) the Required Persons have consented
(if the Subsidiary is General or Coastline) or the Modification Condition
has been satisfied (for any other Subsidiary), (ii) the Servicer shall
have delivered to the Trustee a supplement to the Monthly Report then in
effect as described in Section 3.5(e) of the Pooling Agreement and shall
have confirmed in writing to the Trustee that the Seller Guaranty covers
Obligations of such Subsidiary, (iii) such Subsidiary and the parties
hereto shall have executed and delivered the agreements, instruments and
other documents and the amendments or other modifications to the
Transaction Documents, in form and substance reasonably satisfactory to
Buyer, the Trustee and each Required Person, that Buyer, the Trustee or
any Required Person reasonably determine are necessary or appropriate to
effect the addition and (iv) shall have delivered such legal opinions as
are in form and substance satisfactory to the Rating Agencies, each
Required Person and the Trustee.
SECTION 1.8 Contribution of Receivables. (a) ICP hereby
transfers to ICPPC, as a contribution to the capital of ICPPC, all its
right, title and interest in, to and under:
(i) $1,017,156,.79 of Receivables of ICP having, among
the existing Receivables, the oldest invoice dates as of the
closing of ICP's business on the Initial Cut-Off Date (the
"Contributed ICPPC Initial Receivables"),
(ii) all Related Security with respect to the
Contributed ICPPC Initial Receivables,
(iii) all proceeds of the foregoing, including all funds
received by any Person in payment of any amounts owed (including
invoice prices, finance charges, interest and all other charges,
if any) in respect of any Contributed ICPPC Initial Receivable or
Related Security with respect to any such Contributed ICPPC
Initial Receivable, or otherwise applied to repay or discharge
any such Contributed ICPPC Initial Receivable (including
insurance payments that ICP or the Servicer applies in the
ordinary course of its business to amounts owed in respect of any
such Contributed ICPPC Initial Receivable and net proceeds of any
sale or other disposition or repossessed goods that were the
subject of any such Contributed ICPPC Initial Receivable) or
other collateral or property of any Obligor or any other party
directly or indirectly liable for payment of such Contributed
ICPPC Initial Receivables, and
(iv) all Records relating to any of the foregoing (the
items listed above in clauses (ii), (iii) and (iv) being referred
to herein as the "Related Contributed ICPPC Initial Assets").
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(b) ICPPC hereby transfers to Buyer, as a contribution
to the capital of Buyer, all its right, title and interest in, to and
under the Contributed ICPPC Initial Receivables and the Related
Contributed ICPPC Initial Assets.
(c) ICP hereby transfers to Buyer, as a contribution to
the capital of Buyer, all its right, title and interest in, to and under:
(i) $54,926,466.85 of Receivables of ICP having, among
the existing Receivables (other than the Contributed ICPPC
Initial Receivables), the oldest invoice dates as of the closing
of ICP's business on the Initial Cut-Off Date (the "Contributed
ICP Initial Receivables," and collectively with the Contributed
ICPPC Initial Receivables, the "Contributed Initial
Receivables"),
(ii) all Related Security with respect to the
Contributed ICP Initial Receivables,
(iii) all proceeds of the foregoing, including all funds
received by any Person in payment of any amounts owed (including
invoice prices, finance charges, interest and all other charges,
if any) in respect of any Contributed ICP Initial Receivable or
Related Security with respect to any such Contributed ICP Initial
Receivable, or otherwise applied to repay or discharge any such
Contributed ICP Initial Receivable (including insurance payments
that ICP or the Servicer applies in the ordinary course of its
business to amounts owed in respect of any such Contributed ICP
Initial Receivable and net proceeds of any sale or other
disposition or repossessed goods that were the subject of any
such Contributed ICP Initial Receivable) or other collateral or
property of any Obligor or any other party directly or indirectly
liable for payment of such Contributed ICP Initial Receivables,
and
(iv) all Records relating to any of the foregoing (the
items listed above in clauses (ii), (iii) and (iv) being referred
to herein as the "Related Contributed ICP Initial Assets," and
collectively with the Related Contributed ICPPC Initial Assets,
the "Related Contributed Initial Assets").
(d) On any date following the date hereof, (x) ICP may
elect to transfer to Buyer or to ICPPC (in which case ICPPC shall
immediately transfer to Buyer), as a contribution to capital, or (y) ICP
may be required to transfer to Buyer or to ICPPC (in which case ICPPC
shall immediately transfer to Buyer), as a contribution to capital
pursuant to Section 3.1(a)(iii):
(i) any Receivables which have arisen since the
preceding Business Day which ICP shall have identified on a
schedule (a "Contributed Subsequent Receivables Schedule")
delivered to the Buyer on such date (such Receivables being
"Contributed Subsequent Receivables" and, together with
Contributed Initial Receivables, "Contributed Receivables"),
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(ii) all Related Security with respect to the
Contributed Subsequent Receivables,
(iii) all proceeds of the foregoing, including all funds
received by any Person in payment of any amounts owed (including
invoice prices, finance charges, interest and all other charges,
if any) in respect of any Contributed Subsequent Receivable or
Related Security with respect to any such Contributed Subsequent
Receivable, or otherwise applied to repay or discharge any such
Contributed Subsequent Receivable (including insurance payments
that ICP or the Servicer applies in the ordinary course of its
business to amounts owed in respect of any such Contributed
Subsequent Receivable and net proceeds of any sale or other
disposition or repossessed goods that were the subject of any
such Contributed Subsequent Receivable) or other collateral or
property of any Obligor or any other party directly or indirectly
liable for payment of such Contributed Subsequent Receivables,
and
(iv) all Records relating to any of the foregoing (the
items listed above in clauses (ii), (iii) and (iv) being referred
to herein as the "Related Contributed Subsequent Assets" and,
together with the Related Contributed Initial Assets, "Related
Contributed Assets").
ARTICLE II
CALCULATION OF PURCHASE PRICE
SECTION 2.1 Calculation of Purchase Price. (a) On each
Business Day (including the First Issuance Date), the Servicer shall
deliver to Buyer, the Trustee and ICP a Daily Report with respect to
Buyer's purchases of Receivables from the Sellers:
(i) that are to be made on the First Issuance Date (in
the case of the Daily Report to be delivered on the First
Issuance Date) or
(ii) that were made on the immediately preceding
Business Day (in the case of each subsequent Daily Report).
(b) On each day when Receivables are purchased by Buyer from
a Seller pursuant to Article I, the "Purchase Price" to be paid to such
Seller on such day for the Purchased Receivables and Related Purchased
Assets that are to be sold by such Seller on such day shall be determined
in accordance with the following formula:
PP = AUB x PPP
where:
PP = the aggregate Purchase Price for the Purchased
Receivables and Related Purchased Assets to be
purchased from such Seller on such day,
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AUB = the "Aggregate Unpaid Balance" of the Purchased
Receivables that are to be purchased from such
Seller on such day. For purposes of this
calculation, "Aggregate Unpaid Balance" shall mean
(i) for purposes of calculating the Purchase Price
to be paid to such Seller on the First Issuance
Date, the sum of the Unpaid Balance of each
Receivable generated by such Seller (other than
Contributed Initial Receivables), as measured as
at the closing of such Seller's business on the
Initial Cut-Off Date, and (ii) for purposes of
calculating the Purchase Price on each Business
Day thereafter, the sum of the Unpaid Balance of
each Receivable to be purchased from such Seller
on such day, calculated at the time of the
Receivable's sale to Buyer, and
PPP = the Purchase Price Percentage applicable to the
Receivables to be purchased on such day, as
determined pursuant to Section 2.2.
SECTION 2.2 Definitions and Calculations Related to Purchase
Price Percentage.
(a) "Purchase Price Percentage" for the Receivables to be
sold by a Seller on any day during a Distribution Period shall mean the
percentage determined in accordance with the following formula:
PPP = 100% - (LLR + PDRR)
where:
PPP = the Purchase Price Percentage in effect during
such Distribution Period,
LLR = the Loss to Liquidation Ratio (expressed as a
percentage) in effect during such Distribution
Period, and
PDRR = the Purchase Discount Reserve Ratio (expressed as
a percentage) in effect during such Distribution
Period, as determined on such day pursuant to
subsection (b) below.
The Purchase Price Percentage, the Loss to Liquidation Ratio and the
Purchase Discount Reserve Ratio shall be recomputed by the Servicer on
each Report Date, in each case as of the then most recent Cut-Off Date,
and shall become effective on the next Distribution Date.
(b) "Purchase Discount Reserve Ratio" for the Receivables to
be sold on any day shall mean a percentage determined in accordance with
the following formula:
PDRR = (TD/360 x DR) + PD
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where:
PDRR = the Purchase Discount Reserve Ratio in effect
during such Distribution Period,
TD = the Portfolio Collection Days during the
Calculation Period preceding the first day of such
Distribution Period,
DR = the Discount Rate (expressed as a percentage) in
effect during such Distribution Period as
determined pursuant to subsection (c) below, and
PD = a profit discount equal to .25%; provided that
such percentage may be changed by written
agreement of the Sellers and Buyer if, prior to
giving effect to such change, (i) Buyer shall have
provided to the Trustee, the Agent and the Rating
Agencies a Bankruptcy Opinion that takes such
change into account and (ii) the Modification
Condition shall have been satisfied.
(c) "Discount Rate" for the Receivables to be sold on any day
during a Distribution Period shall mean a fraction (expressed as a
percentage) having (i) a numerator equal to 12 multiplied by an amount
equal to the sum for the Calculation Period ending prior to the first day
of such Distribution Period of (A) accrued Carrying Costs and (B) accrued
interest on Buyer Notes and (ii) a denominator equal to the aggregate
Unpaid Balance of the Receivables as of the last day of the Calculation
Period preceding the first day of such Distribution Period.
ARTICLE III
PAYMENT OF PURCHASE PRICE; SERVICING, ETC.
SECTION 3.1 Purchase Price Payments. (a) On the First
Issuance Date and on the Business Day following each day on which any
Purchased Receivables and Related Purchased Assets are purchased by Buyer
pursuant to Article I, on the terms and subject to the conditions of this
Agreement, Buyer shall pay to the Sellers the Purchase Price for the
Purchased Receivables and Related Purchased Assets purchased on such day
by Buyer (i) by making a cash payment to Servicer (for the account of the
Sellers) to the extent that Buyer has cash available to make the payment
pursuant to Section 3.3, (ii) if the Purchase Price to be paid for such
Receivables and Related Assets of any Seller exceeds the amount of any
cash actually paid for the account of such Seller on such day pursuant to
clause (i), by automatically increasing the principal amount outstanding
under the relevant Buyer Notes by the amount of such excess and (iii) if
the Purchase Price to be paid for such Receivables and Related Assets of
ICP exceeds the sum of (x) the amount of any cash paid to the Servicer on
such day pursuant to clause (i) and (y) the aggregate amount by which all
Buyer Notes may be increased without exceeding the Maximum Exposure
Amount, by deeming (x) Receivables in an amount equal to 99% of such
excess to have been contributed to Buyer by ICP as a capital contribution,
(y) Receivables in an
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amount equal to 1% of such excess to have been contributed to ICPPC by ICP
as a capital contribution and (z) the Receivables contributed to ICPPC
pursuant to clause (y) to have been contributed to Buyer by ICPPC as a
capital contribution.
Each Seller agrees that, prior to the Seller Maturity Date, Buyer
shall be required to make payments in respect of the payment obligations
evidenced by the Buyer Notes only to the extent that it has cash available
under Section 3.3.
(b) Except as provided in a Supplement, on each Business Day,
the "Noncomplying Receivables and Dilution Adjustment" shall be equal to
the result (whether the result is positive or negative) of (i) the sum of
(A) the aggregate Seller Dilution Adjustments in respect of all Sellers,
if any, for the immediately preceding Business Day, as shown in the Daily
Report for such day, plus (B) the aggregate Seller Noncomplying
Receivables Adjustments in respect of all Sellers, if any, for the
immediately preceding Business Day, as shown in the Daily Report for such
day, in the case of each of clauses (A) and (B), as the amounts are
determined pursuant to Section 3.5, minus (ii) the amount of the payments
(if any) that Buyer shall have received on the immediately preceding
Business Day on account of any Seller Noncomplying Receivables that had
been the subject of an earlier Seller Noncomplying Receivables Adjustment.
If the Noncomplying Receivables and Dilution Adjustment is positive on any
day, Buyer shall reduce the Purchase Price payable on such day pursuant
to subsection (a) above by the amount of the Noncomplying Receivables and
Dilution Adjustment. If instead, the Noncomplying Receivables and
Dilution Adjustment is negative on any day, Buyer shall increase the
Purchase Price payable pursuant to subsection (a) above on such day by the
amount of the Noncomplying Receivables and Dilution Adjustment.
(c) If on any day the Noncomplying Receivables and Dilution
Adjustment attributable to any Seller exceeds the Purchase Price payable
by Buyer to such Seller pursuant to subsection (a) above on such day (the
amount of such excess being a "Seller Noncomplying Receivables and
Dilution Excess") then (i) if a Trust Asset Shortfall exists on such day
or if the Purchase Termination Date has occurred, such Seller shall pay
to the Servicer an amount equal to the lesser of (A) the amount of the
Trust Asset Shortfall and (B) the amount of the Seller Noncomplying
Receivables and Dilution Excess, (ii) to the extent of any remaining
Seller Noncomplying Receivables and Dilution Excess after reducing it by
the amount paid to the Servicer pursuant to clause (i), the principal
amount of Seller's Buyer Note shall be reduced automatically by the amount
of such remaining Seller Noncomplying Receivables and Dilution Excess and
(iii) any Seller Noncomplying Receivables and Dilution Excess remaining
after reduction by the amounts specified in clauses (i) and (ii) shall be
paid to Servicer. Amounts paid to Servicer pursuant to this Section
3.1(c) shall be deposited on behalf of such Seller into the Master
Collection Account and shall be deemed a Collection in accordance with
Section 3.5.
(d) If, on any day, the amounts, if any, allocated to any
Seller pursuant to clause (b)(ii) above exceed the sum of any Seller
Dilution Adjustments and the Seller Noncomplying Receivables Adjustments,
if any, in respect of such Seller (as determined pursuant to Section
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3.5) for such day, then Buyer shall either (i) pay Servicer (for the
account of such Seller) in cash the amount of such excess, or (ii) if
Buyer does not have sufficient cash to pay such amount in full, increase
the principal amount of such Seller's Buyer Note by the amount of such
excess that is not paid in cash to Servicer.
(e) Amounts received by Servicer pursuant to this Section 3.1
shall be allocated among the Sellers in accordance with Section 3.3, and
the Seller Dilution Adjustments and the Seller Noncomplying Receivables
Adjustments, if any, in respect of each such Seller (as determined
pursuant to Section 3.5) shall be allocated to such Seller. Servicer
shall maintain a bookkeeping account (the "Seller Account") for purposes
of tracking:
(i) the Purchase Price payable to each Seller in
respect of Receivables and Related Assets sold by it to Buyer
(including the extent to which cash and non-cash payments made by
Buyer should be allocated to each Seller),
(ii) the extent to which such Purchase Price should be
reduced on account of such Seller's Seller Dilution Adjustments
and Seller Noncomplying Receivables Adjustments (including any
allocation of Seller Noncomplying Receivables and Dilution
Excess),
(iii) if a Seller makes cash payments in respect of the
Noncomplying Receivables and Dilution Adjustment (including any
payment in respect of Seller Noncomplying Receivables and
Dilution Excess), the obligation of each other Seller to
reimburse such Seller for its proportionate share thereof,
(iv) if Purchase Price payments attributable to a
Seller's Receivables and Related Assets have been reduced on
account of another Seller's Seller Dilution Adjustment or the
Seller Noncomplying Receivables Adjustment, the obligation of
such other Seller to reimburse the Seller subject to such
reduction,
(v) the extent to which payments (whether cash or non-
cash) by Buyer in respect of a negative Noncomplying Receivables
and Dilution Adjustment should be allocated to each Seller, and
(vi) cash payments made to and by each Seller in respect
of the items described above.
Servicer shall calculate each of the items set forth above on each
day. Intercompany accounts among the Sellers resulting from the items
described above and any payments made by ICP pursuant to the Seller
Guaranty will be settled in accordance with the intercompany cash
management system customarily employed by ICP and its Subsidiaries.
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SECTION 3.2 The Buyer Notes. (a) On the First Issuance Date,
Buyer will deliver to each Seller a promissory note, substantially in the
form of Exhibit A, payable to the order of such Seller (each such
promissory note, as the same may be amended, supplemented, endorsed or
otherwise modified from time to time, together with any promissory note
issued from time to time in substitution therefor or renewal thereof in
accordance with the Transaction Documents, being herein called a "Buyer
Note"), that is subordinated to all Senior Interests now or hereafter
arising under or in connection with the Pooling Agreement. Each Buyer
Note is payable in full on the date (the "Seller Maturity Date") that is
one year and one day after the date on which all Investor Certificates
have been repaid in full and the Revolving Periods for all Investor
Certificates have terminated. Each Buyer Note bears interest at a rate
per annum equal to the rate publicly announced by the Trustee from time
to time as its "reference" or "prime" rate, determined as of each Cut-Off
Date. Buyer may prepay all or part of the outstanding balance of any
Buyer Note from time to time without any premium or penalty, unless the
prepayment would result in a default in Buyer's payment of any other
amount required to be paid by it under any Transaction Document.
(b) The Initial Servicer (or its designee) shall hold all
Buyer Notes for the benefit of the Sellers and shall make all appropriate
recordkeeping entries with respect to the Buyer Notes or otherwise to
reflect the payments on and adjustment of the Buyer Notes. The Initial
Servicer's books and records shall constitute rebuttable presumptive
evidence of the principal amount of and accrued interest on each Buyer
Note at any time. Each Seller hereby irrevocably authorizes the Initial
Servicer to ▇▇▇▇ its Buyer Note "CANCELLED" and return it to Buyer upon
the final payment thereof.
SECTION 3.3 Application of Collections and Other Funds. If,
on any day, Buyer receives proceeds of transfers pursuant to the Pooling
Agreement, Buyer shall apply the funds as follows:
(a) first, to pay its existing expenses and to set
aside funds for the payment of expenses that are then accrued (in
each case to the extent such expenses are permitted to exist
under Section 7.2(m) of the Pooling Agreement),
(b) second, to pay the Purchase Price as adjusted
pursuant to Section 3.1 for Receivables and Related Assets
purchased by Buyer from the Sellers on such day (in the case of
the First Issuance Date) or the next preceding Business Day,
(c) third, in such order among Sellers as Buyer shall
elect, to repay amounts owed by Buyer to the Sellers under the
Buyer Notes,
(d) fourth, to pay amounts owed pursuant to Section
3.1(d), and
(e) fifth, if the Buyer shall elect, to declare and
make distributions to its partners to the extent permitted by law
and the Transaction Documents.
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SECTION 3.4 Servicing of Receivables and Related Assets.
Consistent with Buyer's ownership of the Receivables and the Related
Assets, as between the parties to this Agreement, Buyer shall have the
sole right to service, administer and collect the Receivables, to assign
the right and to delegate the right to others. Without limiting the
generality of Section 10.11, each Seller hereby acknowledges and agrees
that Buyer shall assign to the Trustee for the benefit of the Investor
Certificateholders the rights and interests of Buyer hereunder and agrees
to cooperate fully with the Servicer and the Trustee in the exercise of
such rights and interests. As more fully described in Section 7.4(b) and
in the Pooling Agreement, the Trustee may exercise the rights in the place
of Buyer (as assignee or otherwise) only after the designation of a
Servicer other than the Initial Servicer pursuant to Section 10.2 of the
Pooling Agreement.
At Trustee's request, each Seller will (A) assemble all of the
Records that are necessary or appropriate to collect the Receivables and
Related Transferred Assets, and shall make the same available to Trustee
at one or more places selected by Trustee or its designee, and (B) permit,
upon not less than two Business Days' prior written notice, any Successor
Servicer and its agents, employees and assignees access to their
respective facilities and their respective Records.
SECTION 3.5 Adjustments for Noncomplying Receivables and
Dilution. (a) If at any time any of Buyer, the Servicer, the Trustee or
a Seller shall determine that any Receivable identified by the Servicer
as an Eligible Receivable on the date of Purchase thereof by Buyer or the
contribution thereof to Buyer was in fact a Seller Noncomplying Receivable
on such date, or that any of the representations and warranties made by
the related Seller in Section 5.1(k) with respect to such Receivable was
not true on such date, such Seller shall be deemed to have received on the
date of such determination a Collection of the Receivable in an amount
equal to the Unpaid Balance of the Receivable on such date (the sum of all
such amounts for such Seller on any day being called the "Seller
Noncomplying Receivables Adjustment" for such Seller for such day), and
such Seller Noncomplying Receivables Adjustment shall be settled in the
manner provided for in Section 3.1.
(b) If on any day the aggregate Unpaid Balance of the
Receivables sold or contributed to Buyer on or before such date by a
Seller is reduced in any manner described in the definition of "Dilution"
(the total of the reductions being called the "Seller Dilution Adjustment"
for the Seller for such day), then such Seller shall be deemed to have
received on such day a Collection of Receivables in the amount of the
Seller Dilution Adjustment and such Seller Dilution Adjustment shall be
settled in the manner provided in Section 3.1.
SECTION 3.6 Payments and Computations, Etc. (a) All amounts
to be paid by a Seller to Buyer hereunder shall be received in accordance
with the terms hereof no later than 1:00 p.m., New York City time, on the
day when due in Dollars in immediately available funds in the Master
Collection Account. Payments received by Buyer after such time shall be
deemed to have been received on the next Business Day. In the event that
any payment otherwise is scheduled to become due on a day that is not a
Business Day, then payment shall become due
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on the next Business Day. Each Seller shall, to the extent permitted by
law, pay to Buyer, on demand, interest on all amounts not paid when due
hereunder at 2% per annum above the interest rate on the applicable Buyer
Note in effect on the date the payment was due; provided, however, that
the interest rate shall not at any time exceed the maximum rate permitted
by applicable law. All computations of interest payable hereunder shall
be made on the basis of a year of 360 days for the actual number of days
(including the first but excluding the last day) elapsed.
(b) All amounts to be paid by Buyer to a Seller hereunder
shall be paid to Servicer (for the account of such Seller) no later than
2:00 p.m., New York City time, on the day when due in Dollars in
immediately available funds to an account that Servicer shall from time
to time specify in writing. Payments received by Servicer after such time
shall be deemed to have been received on the next Business Day. Servicer
shall promptly remit payments received by it in immediately available
funds to such account as the applicable Seller shall from time to time
specify in writing. In the event that any payment otherwise is scheduled
to become due on a day that is not a Business Day, then such payment shall
become due on the next Business Day.
(c) Permitted Inventory Discretionary Returns shall not be
deemed to give rise to a Seller Noncomplying Receivables Adjustment or a
Seller Dilution Adjustment if effected in accordance with Section 3.2(k)
of the Pooling Agreement.
ARTICLE IV
CONDITIONS TO PURCHASES
SECTION 4.1 Conditions Precedent to Initial Purchase. The
initial purchase hereunder is subject to the conditions precedent that (i)
each of the conditions precedent to the execution, delivery and
effectiveness of each other Transaction Document (other than a condition
precedent in any other Transaction Document relating to the effectiveness
of this Agreement) shall have been fulfilled to the satisfaction of Buyer,
and (ii) Buyer shall have received (or in the case of subsection (f)
below, shall have delivered) each of the following, on or before the First
Issuance Date, each (unless otherwise indicated) dated the date hereof or
the First Issuance Date and each in form and substance satisfactory to
Buyer:
(a) Seller Assignment Certificates. A Seller
Assignment Certificate from each Seller in the form of Exhibit B,
duly completed, executed and delivered by such Seller,
(b) Resolutions. A copy of the resolutions of the
Board of Directors of each Seller approving this Agreement and
the other Transaction Documents to be delivered by it hereunder
and the transactions contemplated hereby and thereby and
addressing such other matters as may be required by Buyer,
certified by its Secretary or Assistant Secretary, each as of a
recent date acceptable to Buyer,
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(c) Good Standing Certificate of each Seller;
Certificates as to Foreign Qualification of each Seller. A good
standing certificate for each Seller, issued as of a recent date
by the Secretary of State of: (i) the jurisdiction of its
incorporation and (ii) each state in which such Seller does
business and where the failure so to be in good standing
reasonably could be expected to have a Material Adverse Effect,
(d) Incumbency Certificate. A certificate of the
Secretary or Assistant Secretary of each Seller certifying, as of
a recent date reasonably acceptable to Buyer, the names and true
signatures of the officers authorized on such Seller's behalf to
sign the Transaction Documents to be delivered by such Seller (on
which certificate Buyer, the Trustee and the Servicer may
conclusively rely until such time as Buyer shall receive from
such Seller (with a copy to the Trustee and the Servicer), a
revised certificate meeting the requirements of this subsection),
(e) Other Transaction Documents. Original copies,
executed by each of the parties thereto in such reasonable number
as shall be specified by Buyer, of each of the other Transaction
Documents to be executed and delivered in connection herewith,
(f) Buyer Notes. The Buyer Notes, executed by Buyer,
and
(g) License Agreements. Duly executed counterparts of
(i) software license agreements between each Seller or Servicer
that uses its own proprietary software in the origination or
servicing of Receivables or Related Assets and Buyer, and (ii)
amendments to any license agreement between a Seller or Servicer
and any third party vendor, adding any substitute Servicer as a
licensee.
(h) Auditors' Letter. A letter from Coopers & ▇▇▇▇▇▇▇
L.L.P. in form and substance satisfactory to Buyer, as to certain
agreed-upon procedures performed prior to the First Issuance
Date.
SECTION 4.2 Certification as to Representations and Warranties.
Each Seller (by accepting the Purchase Price paid for each Purchase), ICP
(upon a contribution of Receivables and Related Assets to the Buyer or
ICPPC) and ICPPC (upon a contribution of Receivables and Related Assets
to the Buyer) shall be deemed to have certified with respect to such
Receivables and Related Assets to be sold or contributed on such day that
its representations and warranties contained in Article V (excluding, with
respect to any day after the First Issuance Date, Section 5.1(i)) are true
and correct on and as of such day, with the same effect as though made on
and as of such day.
SECTION 4.3 Effect of Payment of Purchase Price. Upon the
payment of the Purchase Price (whether in cash or by an increase in a
Buyer Note pursuant to Section 3.1) for any Purchase or, in the case of
ICP or ICPPC as a Seller, by a capital contribution, title to the
Receivables and the Related Assets included in the Purchase shall vest in
Buyer, whether or not
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the conditions precedent to the Purchase were in fact satisfied; provided,
however, that Buyer shall not be deemed to have waived any claim it may
have under this Agreement for the failure by a Seller in fact to satisfy
any such condition precedent. Upon any capital contribution of
Receivables and Related Assets by ICP to ICPPC, title to the Receivables
and Related Assets included in the contribution shall vest in ICPPC.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
SECTION 5.1 Representations and Warranties of the Sellers. In
order to induce Buyer to enter into this Agreement and to make purchases
hereunder, each Seller hereby makes the representations and warranties set
forth in this section with respect to itself at the times and to the
extent set forth in Section 4.2 (it being understood that only ICP makes
the representations and warranties set forth below with respect to any
Contributed Receivables and Related Contributed Assets). Furthermore, in
order to induce ICPPC to enter into this Agreement, ICP hereby makes the
representations and warranties set forth in this section with respect to
itself at the times and to the extent set forth in Section 4.2 with
respect to any Contributed Receivables and Related Contributed Assets
contributed to ICPPC.
(a) Organization and Good Standing. Such Seller is a
corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has
full power and authority to own its properties and to conduct its
business as the properties presently are owned and the business
presently is conducted. Such Seller had at all relevant times,
and now has, all necessary power, authority and legal right to
own, sell and (if applicable) contribute its Receivables and the
Related Assets.
(b) Due Qualification. Such Seller is duly qualified
to do business and is in good standing as a foreign corporation
(or is exempt from such requirements), and has obtained all
necessary licenses and approvals, in all jurisdictions in which
the ownership or lease of property or the conduct of its business
requires qualification, licenses or approvals.
(c) Power and Authority; Due Authorization. Such
Seller has (i) all necessary power and authority to (A) execute
and deliver this Agreement and the other Transaction Documents to
which it is a party, (B) perform its obligations under this
Agreement and the other Transaction Documents to which it is a
party, and (C) sell, assign and (if applicable) contribute the
Receivables and the Related Assets on the terms and subject to
the conditions herein and therein provided and (ii) duly
authorized by all necessary action such sale, assignment and (if
applicable) contribution, the execution, delivery and performance
of this Agreement and the other Transaction Documents to which it
is a
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party and the consummation of the transactions provided for in
this Agreement and the other Transaction Documents to which it is
a party.
(d) Valid Sale; Binding Obligations. Each sale of
Receivables and Related Assets made by such Seller pursuant to
this Agreement, and each contribution of Receivables and Related
Assets made to Buyer shall constitute a valid sale (except in the
case of Contributed Receivables and Related Contributed Assets),
transfer and assignment of all of such Seller's right, title and
interest in, to and under such Receivables and the Related Assets
of such Seller to Buyer that is perfected and of first priority
under the UCC and otherwise, enforceable against creditors of,
and purchasers from, such Seller and free and clear of any
Adverse Claim (other than any Permitted Adverse Claim); and this
Agreement constitutes, and each other Transaction Document to
which such Seller is a party when duly executed and delivered
will constitute, a legal, valid and binding obligation of such
Seller, enforceable against it in accordance with its terms,
except as enforceability may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally and by general
principles of equity, regardless of whether enforceability is
considered in a proceeding in equity or at law.
(e) No Conflict or Violation. The execution, delivery
and performance of, and the consummation of the transactions
contemplated by, this Agreement and the other Transaction
Documents to be signed by such Seller and the fulfillment of the
terms hereof and thereof will not (i) conflict with, violate,
result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time or both) a
default under, (A) its Certificate of Incorporation or Bylaws or
(B) any indenture, loan agreement, mortgage, deed of trust or
other agreement or instrument to which such Seller is a party or
by which it or any of its properties is bound, (ii) result in the
creation or imposition of any Adverse Claim upon any of the
Receivables or Related Assets pursuant to the terms of any such
indenture, loan agreement, mortgage, deed of trust or other
agreement or instrument, other than to this Agreement and the
other Transaction Documents, or (iii) conflict with or violate
any federal, state, local or foreign law or any decision, decree,
order, rule or regulation applicable to it or any of its
properties of any court or of any federal, state, local or
foreign regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over it or any
of its properties.
(f) Litigation and Other Proceedings. Except as
described in Schedule 1, (i) there is no action, suit, proceeding
or investigation pending or, to the best knowledge of such
Seller, threatened against it before any court, regulatory body,
arbitrator, administrative agency or other tribunal or
governmental instrumentality and (ii) it is not subject to any
order, judgment, decree, injunction, stipulation or consent order
of or with any court or other government authority that, in the
case of each of clauses (i) and (ii), (A) asserts the invalidity
of this Agreement or any other Transaction Document, (B) seeks to
prevent the sale, assignment or contribution of any Receivables
or Related
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Assets by such Seller to Buyer, the issuance of the applicable
Seller Assignment Certificate or the consummation of any of the
transactions contemplated by this Agreement or any other
Transaction Document, (C) seeks any determination or ruling that
would materially and adversely affect the performance by such
Seller of its obligations under this Agreement or any other
Transaction Document or the validity or enforceability of this
Agreement or any other Transaction Document, (D) seeks to affect
adversely the income tax attributes of the purchases hereunder or
the applicable Seller Assignment Certificate, in the case of each
of the foregoing whether under the United States Federal income
tax system or any state income tax system, or (E) individually or
in the aggregate for all such actions, suits, proceedings and
investigations would have a reasonable likelihood of having a
Material Adverse Effect.
(g) Third Party Approvals. Except for the filing of
the Public Notices referred to in Article IV, all of which, at
the time required in Article IV, shall have been duly made and
shall be in full force and effect, all authorizations, consents,
orders and approvals of, or other action by, any Governmental
Authority or other third party that are required to be obtained
by such Seller, and all notices to and filings with any
Governmental Authority or other third party that are required to
be made by it, in the case of each of the foregoing in connection
with the conveyance of Receivables and Related Assets or the due
execution, delivery and performance by such Seller of this
Agreement, such Seller's Seller Assignment Certificate or any
other Transaction Document to which it is a party and the
consummation of the transactions contemplated by this Agreement
and the other Transaction Documents, have been obtained or made
and are in full force and effect.
(h) Bulk Sales Act. No transaction contemplated by
this Agreement or any other Transaction Document requires
compliance with, or will be subject to avoidance under, any bulk
sales act or similar law.
(i) Financial Condition. The audited consolidated
balance sheet of ICP and its consolidated Subsidiaries as at the
end of ICP's most recent fiscal year and the related statements
of earnings, stockholders' equity and cash flows of ICP and its
consolidated Subsidiaries for such fiscal year and the unaudited
consolidated balance sheet of ICP and its consolidated
Subsidiaries as at the end of ICP's most recent fiscal quarter
and the related statements of earnings, stockholders' equity and
cash flows of ICP and its consolidated Subsidiaries for such
fiscal quarter, copies of which have been furnished to Buyer, the
Trustee and each Required Person, fairly present the consolidated
financial position and business of ICP and its consolidated
Subsidiaries as at the dates specified therein and the
consolidated results of the operations of ICP and its
consolidated Subsidiaries for the periods ended on such dates,
all in accordance with GAAP consistently applied throughout the
periods reflected therein, and, since the end of ICP's most
recent fiscal year through the date hereof there has been no
material adverse change
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in the condition (financial or otherwise), business or operations
of ICP and its consolidated Subsidiaries.
(j) Margin Regulations. No use of any funds obtained
by such Seller under this Agreement will conflict with or
contravene any of Regulations G, T, U and X promulgated by the
Federal Reserve Board from time to time.
(k) Quality of Title. (i) Immediately before each
purchase to be made by Buyer hereunder and (in the case of ICP
and ICPPC) each contribution to be made to Buyer, each Receivable
and Related Asset of such Seller that is then to be transferred
to Buyer thereunder, and the related Contracts, shall be owned by
such Seller free and clear of any Adverse Claim (other than any
Permitted Adverse Claim or any Adverse Claim arising solely as
the result of any action taken by Buyer hereunder or by the
Trustee under the Pooling Agreement); provided that the existence
of an Adverse Claim that is released on the First Issuance Date
(upon application of the proceeds of the issuance of Certificates
on that date) shall not constitute a breach of this
representation and warranty; and such Seller shall have made or
effected all Public Notices and shall have taken all other action
under applicable law in each relevant jurisdiction in order to
protect and perfect the ownership interest of Buyer and its
successors in the Receivables and Related Assets against all
creditors of, and purchasers from, such Seller.
(ii) Whenever Buyer makes a purchase hereunder
from such Seller (or accepts a contribution from ICP or
ICPPC), Buyer shall have acquired a valid and perfected
first priority ownership interest in each Specified Asset
sold by such Seller or contributed by ICP or ICPPC on
such date, free and clear of any Adverse Claim (other
than any Permitted Adverse Claim).
(iii) No effective Public Notice that covers all
or part of any Receivable originated by such Seller, any
interest therein or any Related Asset with respect
thereto is on file in any recording office except such as
may be filed (A) in favor of such Seller in accordance
with the Contracts, (B) in favor of Buyer pursuant to
this Agreement and (C) in favor of the Trustee, for the
benefit of the Investor Certificateholders, in accordance
with the Pooling Agreement. No Public Notice relating to
perfection that covers any inventory of such Seller that
might give rise to Receivables is on file in any
recording office except for (x) (so long as an
Intercreditor Agreement is in effect) Public Notices in
favor of creditors of such Seller bound by such
Intercreditor Agreement and (y) that certain Public
Notice in favor of The Toronto Dominion Bank which covers
certain inventory of ICP but which does not cover any
Specified Assets (including, without limitation, any
Related Security).
(iv) No Purchase by Buyer from such Seller (or,
in the case of ICP and ICPPC, no capital contribution to
Buyer) constitutes a fraudulent transfer or
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fraudulent conveyance under the United States Bankruptcy
Code or applicable state bankruptcy or insolvency laws or
is otherwise void or voidable or subject to subordination
under similar laws or principles or for any other reason.
(v) Each Purchase by Buyer from such Seller
constitutes a true and valid sale of the Receivables and
Related Assets under applicable state law and true and
valid assignments and transfers for consideration (and
not merely a pledge of the Receivables and Related Assets
for security purposes), enforceable against the creditors
of such Seller, and no Receivables or Related Assets
transferred to Buyer hereunder shall constitute property
of such Seller.
(l) Eligible Receivables. (i) On the date of each
Purchase of Receivables hereunder from such Seller (or, in the
case of ICP or ICPPC, contribution from ICP or ICPPC,
respectively), each such Receivable, unless otherwise identified
to Buyer and the Trustee by the Servicer in the Daily Report for
such date, is an Eligible Receivable, and (ii) on the date of
each Daily Report or Monthly Report that identifies a Receivable
originated by such Seller as an Eligible Receivable, such
Receivable is an Eligible Receivable.
(m) Accuracy of Information. All written information
furnished by or on behalf of such Seller to Buyer, the Servicer
or the Trustee pursuant to or in connection with any Transaction
Document or any transaction contemplated herein or therein shall
not contain any untrue statement of a material fact or omit to
state material facts necessary to make the statements made
therein not misleading, in each case in the light of the
circumstances under which the statements were made or the
information was furnished.
(n) Offices. The principal place of business and chief
executive office of such Seller is located at the address set
forth on Schedule 3, and any other location which has been such
Seller's principal place of business or chief executive office
during the past four months or in which such Seller keeps (or has
kept during the past four months) all Records and all Contracts,
invoices, purchase orders and agreements related to the
Receivables or Related Assets (and all original documents
relating thereto) is specified in Schedule 3 (or at such other
locations, notified to the Servicer, the Trustee, each Rating
Agency and each Required Person in accordance with Section
6.1(f), in jurisdictions where all action required pursuant to
Section 7.3 has been taken and completed).
(o) Account Banks and Payment Instructions. The names
and addresses of all the banks, together with the account numbers
of the accounts at the banks, into which Collections are paid as
of the First Issuance Date have been accurately identified to
Buyer in a letter from such Seller to Buyer dated the First
Issuance Date or have been specified in the notices as shall have
been delivered thereafter pursuant to Section 6.3(c). Each
Account Bank has executed and delivered an Account Agreement to
Buyer and the
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Trustee. Such Seller has instructed all Obligors to submit all
payments on the Receivables and Related Assets directly to one of
the Lockbox Accounts. Any payments not made directly to the
Account Banks will be forwarded by the recipient of such payments
to the Account Banks within two Business Days.
(p) Compliance with Applicable Laws. Such Seller is in
compliance with the requirements of all applicable laws, rules,
regulations and orders of all Governmental Authorities (federal,
state, local or foreign, and including consumer protection and
environmental laws).
(q) Legal Names. Except as set forth in Schedule 4,
since January 1, 1990 such Seller has not been known by any legal
name other than its corporate name as of the date hereof, except
to the extent permitted otherwise pursuant to Section 6.3(e), nor
has such Seller been the subject of any merger, consolidation,
amalgamation or other corporate reorganization since January 1,
1990 that resulted in a change of name, identity or corporate
structure. Such Seller uses no trade names other than its actual
corporate name and the trade names set forth in Schedule 4.
(r) Investment Company Act. Such Seller is not, and is
not controlled by, an "investment company" registered or required
to be registered under the Investment Company Act of 1940, as
amended.
(s) Taxes. Such Seller has filed or caused to be filed
all tax returns (foreign or domestic, federal, province,
territory, state or local) and reports required by law to have
been filed by it and has paid all taxes, assessments and
governmental charges which are due and payable by it, except any
such taxes, assessments or charges (i) that are being diligently
contested in good faith by appropriate proceedings, (ii) for
which adequate reserves in accordance with GAAP have been set
aside on its books and (iii) with respect to which no Adverse
Claim, except Permitted Adverse Claims, has been imposed upon any
Receivables or Related Assets.
(t) Software Programs. Each software program, and any
license or other agreement relating to such program, used in the
origination or servicing of Receivables and Related Assets is
described in Schedule 5.
SECTION 5.2 Representations and Warranties of Buyer. From the
date hereof until the Purchase Termination Date, Buyer hereby represents
and warrants that (a) this Agreement (i) has been duly authorized,
executed and delivered by Buyer and (ii) constitutes the legal, valid and
binding obligation of Buyer, enforceable against it in accordance with its
terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity,
regardless of whether enforceability is considered in a proceeding in
equity or at law, and
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(b) the execution, delivery and performance of this Agreement does not
violate any applicable law or any agreement to which Buyer is a party or
by which its properties are bound.
ARTICLE VI
GENERAL COVENANTS OF THE SELLERS
SECTION 6.1 Affirmative Covenants. From the First Issuance
Date until the first day following the Purchase Termination Date on which
all Obligations of the Sellers shall have been finally and fully paid and
performed and the Invested Amount for each Series shall have been reduced
to zero, unless Buyer shall otherwise give its prior written consent, each
Seller hereby agrees that it will perform the covenants and agreements set
forth in this section.
(a) Compliance with Laws, Etc. Such Seller will comply
in all material respects with all applicable laws, rules,
regulations, judgments, decrees and orders (including those
relating to the Receivables, the Related Assets, the related
Contracts of such Seller and any other agreements related
thereto), in each case to the extent the failure to comply,
individually or in the aggregate for all such failures,
reasonably could be expected to have a Material Adverse Effect.
(b) Preservation of Corporate Existence. Such Seller
will preserve and maintain its corporate existence, rights,
franchises and privileges in the jurisdiction of its
incorporation, and qualify and remain qualified in good standing
as a foreign corporation in each jurisdiction where the failure
to preserve and maintain such existence, rights, franchises,
privileges and qualifications reasonably could be expected to
have a Material Adverse Effect.
(c) Receivables Reviews. Such Seller shall, during
regular business hours upon not less than two Business Days'
prior notice, permit Buyer and its agents or representatives, at
the expense of such Seller, (i) to examine and make copies of and
abstracts from, and to conduct accounting reviews of, all Records
in the possession or under the control of such Seller relating to
the Receivables or Related Assets generated by such Seller, and
(ii) to visit the offices and properties of such Seller for the
purpose of examining the materials described in clause (i) above,
and to discuss matters relating to any Receivables or any Related
Assets of such Seller or such Seller's performance hereunder with
any of the Authorized Officers of such Seller or, with the prior
consent of an Authorized Officer of such Seller, with employees
of such Seller having knowledge of such matters (the examinations
set forth in the foregoing clauses (i) and (ii) being herein
called a "Seller Receivables Review"). Buyer and its agents or
representatives shall be entitled to conduct Seller Receivables
Reviews whenever Buyer, in its reasonable judgment, deems it
appropriate; provided, that prior to the occurrence and
continuance of an Early Amortization Event or an Unmatured Early
Amortization Event or during the period in which the most recent
quarterly servicing report delivered pursuant to Section
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3.7 of the Pooling Agreement discloses a material exception,
Buyer (or its agent or representative) shall give such Seller at
least one Business Day's prior notice of any Seller Receivables
Review, and Buyer shall have the right to request a Seller
Receivables Review not more than three times in any calendar
year.
(d) Keeping of Records and Books of Account. Such
Seller shall maintain and implement administrative and operating
procedures (including an ability to recreate records evidencing
its Receivables and Related Assets in the event of the
destruction of the originals thereof), and shall keep and
maintain all documents, books, records and other information
that, in the reasonable determination of Buyer and the Trustee,
are necessary or advisable in accordance with prudent industry
practice and custom for transactions of this type for the
collection of all Receivables and the Related Assets. Upon the
reasonable request of Buyer made at any time after the occurrence
and continuance of a Servicer Default, such Seller will deliver
copies of all books and records maintained pursuant to this
subsection to the Trustee. Such Seller shall maintain at all
times accurate and complete books, records and accounts relating
to the Receivables, Related Assets and Contracts and all
Collections thereon in which timely entries shall be made. Such
books and records shall be marked to indicate the sales (and, in
the case of ICP and ICPPC, contributions) of all Receivables and
Related Assets hereunder and shall include (i) all payments
received and all credits and extensions granted with respect to
the Receivables and (ii) the return, rejection, repossession or
stoppage in transit of any merchandise, the sale of which has
given rise to a Receivable that has been purchased by or
contributed to Buyer.
(e) Performance and Compliance with Receivables and
Contracts. Such Seller will, at its expense, timely and fully
perform and comply with all provisions, covenants and other
promises required to be observed by it under the Contracts of
such Seller related to the Receivables and Related Assets, in
each case to the extent failure to perform or comply reasonably
could be expected to have a Material Adverse Effect.
(f) Location of Records and Offices. Such Seller will
keep its principal place of business and chief executive office,
and the offices where it keeps all Records related to the
Receivables and the Related Assets (and all original documents
relating thereto), at the addresses referred to in Schedule 3 or,
upon not less than 30 days' prior written notice given by such
Seller to Buyer, the Trustee, the Rating Agencies and each
Required Person at such other locations in jurisdictions where
all action required by Section 7.3 shall have been taken and
completed.
(g) Credit and Collection Policies. Such Seller will
comply with its Credit and Collection Policy in regard to each
Receivable of such Seller and the Related Assets and the
Contracts related to each such Receivable.
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(h) Separate Existence of Buyer. Such Seller hereby
acknowledges that the Trustee, on behalf of the Trust, is
entering into the transactions contemplated by the Transaction
Documents in reliance upon Buyer's identity as a legal entity
separate from such Seller and the other Related Persons.
Therefore, from and after the date hereof until the first day
following the Purchase Termination Date on which all Obligations
shall have been fully paid and performed and the Invested Amount
for each Series shall have been reduced to zero, such Seller
will, and will cause each other Related Person to, take all
reasonable steps to continue their respective identities as
separate legal entities and to make it apparent to third Persons
that each is an entity with assets and liabilities distinct from
those of Buyer and that Buyer is not a division of the Servicer,
such Seller, ICP or any other Person. Without limiting the
foregoing, ICP and each Seller will, and will cause each other
ICP Person to, operate, conduct their respective businesses and
otherwise act in a manner which is consistent with the factual
assumptions in each Bankruptcy Opinion for each Series.
(i) Payment Instructions to Obligors. Such Seller will
instruct all Obligors to submit all payments either (i) to one of
the lockboxes maintained at the Lockbox Banks for deposit in a
Lockbox Account or (ii) directly to one of the Lockbox Accounts.
(j) Segregation of Collections. Such Seller shall use
best efforts to minimize the deposit of any funds other than
Collections into any of the Lockbox Accounts and, to the extent
that any such funds nevertheless are deposited into any of the
Lockbox Accounts, shall promptly identify any such funds, or
shall cause the funds to be so identified, to Buyer, the
Servicer, the Trustee and each Required Person (following which
notice, Buyer shall use best efforts to cause the Servicer to
return all the funds to such Seller).
(k) Identification of Eligible Receivables. Such Seller
will (i) establish and maintain such procedures as are necessary
for determining no less frequently than each Business Day whether
each Receivable qualifies as an Eligible Receivable, and for
identifying, on any Business Day, all Receivables to be sold on
that date that are not Eligible Receivables, and (ii) except as
permitted in Section 3.5(c) of the Pooling Agreement, notify
Buyer prior to the occurrence of a Purchase (and, in the case of
ICP and ICPPC, before a contribution of Receivables and Related
Assets) if a Receivable to be sold or contributed hereunder will,
to such Seller's knowledge, not be an Eligible Receivable as of
the date of such Purchase or contribution.
(l) Accuracy of Information. All written information
furnished on and after the First Issuance Date by or on behalf of
such Seller to Buyer, the Servicer or the Trustee pursuant to or
in connection with any Transaction Document or any transaction
contemplated herein or therein shall not contain any untrue
statement of a material fact or omit to state material facts
necessary to make the statements made not misleading, in each
case on the date the statement was made and in light of the
circumstances under which the statements were made or the
information was furnished.
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(m) Taxes. Such Seller shall file or cause to be filed,
and cause each Person with whom it shares consolidated tax
liability to file, all Federal, state and local tax returns
(foreign or domestic, federal, state, province, territory or
local) and reports required by law to have been filed by it
(except where the failure to file such returns or reports
reasonably could not be expected to have a Material Adverse
Effect) and pay or cause to be paid all taxes, assessments and
governmental charges which are due and payable by it (including
any obligation, as agent or otherwise, to pay or remit any goods
and services tax) except any such taxes or assessments the
validity of which are being contested in good faith by
appropriate proceedings and with respect to which such Seller
shall have set aside adequate reserves on its books in accordance
with GAAP and which proceedings reasonably could not be expected
to have a Material Adverse Effect.
(n) Software Licenses. Such Seller shall cause all
software licenses or similar agreements used by the Sellers or
Servicer in the origination or servicing of Receivables to
expressly permit use by any Successor Servicer of the materials
subject to such licenses or agreements.
SECTION 6.2 Reporting Requirements. From the First Issuance
Date until the first day following the Purchase Termination Date on which
all Obligations of the Sellers shall have been finally and fully paid and
performed and the Invested Amount for each Series shall have been reduced
to zero, such Seller agrees that it will, unless Buyer and the Trustee
shall otherwise give prior written consent, and (with respect to the
notices described below in subsections (c) and (d)) unless the
Modification Condition has been satisfied, furnish to Buyer, the Trustee
and each Required Person (and in the case of the notices described below
in subsections (c), (d) and (f), to the Rating Agencies):
(a) Quarterly Financial Statements. Within 45 days
after the end of each of the first three fiscal quarters of each
fiscal year of ICP, copies of the unaudited consolidated balance
sheets of ICP and its consolidated Subsidiaries as at the end of
the fiscal quarter and the related unaudited statements of
earnings and cash flows, in each case for the fiscal quarter and
for the period from the beginning of the fiscal year through the
end of such fiscal quarter, prepared in accordance with GAAP
consistently applied throughout the periods reflected therein and
certified (subject to year end adjustments and the omission of
footnotes) by the chief financial officer or chief accounting
officer of ICP,
(b) Annual Financial Statements. As soon as possible
and in any event within 90 days after the end of each fiscal year
of ICP, a copy of the audited consolidated balance sheet of ICP
and its consolidated Subsidiaries as at the end of the fiscal
year and the related statements of earnings, stockholders' equity
and cash flows of ICP and its consolidated Subsidiaries for the
fiscal year, setting forth in each case in comparative form the
corresponding figures for the preceding fiscal year and prepared
in accordance with GAAP consistently applied throughout the
periods reflected therein, certified, without Impermissible
Qualification, by Coopers & ▇▇▇▇▇▇▇ L.L.P. (or such other
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independent certified public accountants of a nationally
recognized standing in the United States of America as shall be
selected by ICP),
(c) Early Amortization Events. As soon as possible, and
in any event within two Business Days after any officer of such
Seller has obtained knowledge of the occurrence of any Early
Amortization Event or any Unmatured Early Amortization Event, a
written statement of an Authorized Officer of such Seller
describing the event and the action that such Seller proposes to
take with respect thereto, in each case in reasonable detail,
(d) Material Adverse Effect. As soon as possible and in
any event within two Business Days after any officer of such
Seller has knowledge thereof, written notice that describes in
reasonable detail any event or occurrence that, individually or
in the aggregate for all such events or occurrences, has had, or
reasonably could be expected to have, a Material Adverse Effect,
(e) Proceedings. As soon as possible and in any event
within two Business Days after any officer of such Seller has
knowledge thereof, written notice of (i) any litigation,
investigation or proceeding of the type described in Section
5.1(f) not previously disclosed to Buyer and (ii) any judgment,
settlement or other final disposition with respect to any such
previously disclosed litigation, investigation or proceeding, and
(f) Other. Promptly, from time to time, (i) such other
information, documents, records or reports respecting the
Receivables or the Related Assets or (ii) such other publicly
available information respecting the condition or operations,
financial or otherwise, of such Seller, in each case as Buyer may
from time to time reasonably request in order to protect the
interests of Buyer, the Trustee or the Certificateholders under
or as contemplated by this Agreement.
SECTION 6.3 Negative Covenants. From the First Issuance Date
until the first day following the Purchase Termination Date on which all
Obligations of the Sellers shall have been finally and fully paid and
performed and the Invested Amount for each Series shall have been reduced
to zero, unless Buyer and the Trustee shall otherwise give prior written
consent, each Seller hereby agrees that it will perform the covenants and
agreements set forth in this section.
(a) Sales, Liens, Etc. Except as otherwise provided
herein or in the Pooling Agreement, such Seller will not (i)(A)
sell, assign (by operation of law or otherwise) or otherwise
transfer to any Person, (B) pledge any interest in, (C) grant,
create, incur, assume or permit to exist any Adverse Claim (other
than Permitted Adverse Claims) to or in favor of any Person upon
or with respect to, or (D) cause to be filed any Public Notice
relating to perfection with respect to, any Transferred Asset or
any Contract related to any Receivable, or upon or with respect
to any lockbox or account to which any Collections of any such
Receivable or any Related Assets are sent or any interest
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therein, or (ii) assign to any Person any right to receive income
from or in respect of any of the foregoing.
In the event that such Seller fails to keep any Specified
Assets free and clear of any Adverse Claim (other than a
Permitted Adverse Claim, any Adverse Claims arising hereunder,
and other Adverse Claims permitted by any other Transaction
Document), Buyer may (without limiting its other rights with
respect to such Seller's breach of its obligations hereunder)
make reasonable expenditures necessary to release the Adverse
Claim. Buyer shall be entitled to indemnification for any such
expenditures pursuant to the indemnification provisions of
Article IX. Alternatively, Buyer may deduct such expenditures as
an offset to the Purchase Price owed to such Seller hereunder.
Such Seller will not pledge or grant any security
interest in its inventory, the Buyer Note or its ownership
interest in Buyer unless (i) prior to any pledge or grant such
Seller, Buyer, the Trustee and the Person for whose benefits the
pledge or grant is being made have entered into an Intercreditor
Agreement and (ii) the Modification Condition has been satisfied;
provided that the continuing existence of that certain security
interest previously granted by ICP in favor of The Toronto
Dominion Bank in certain inventory of ICP (but no Specified
Assets (including, without limitation, any Related Security))
shall not be a breach of the covenant contained in this
paragraph.
(b) Extension or Amendment of Receivables; Change in
Credit and Collection Policy or Contracts. Such Seller will not,
(i) without the prior written consent of Buyer and the Trustee,
extend, amend or otherwise modify the terms of any Receivable or
Contract in a manner that reasonably could be expected to have a
Material Adverse Effect or (ii) change the terms and provisions
of the Credit and Collection Policy in any material respect
unless (x) with respect to collection policies, the change is
made with the prior written approval of the Trustee and Buyer and
the Modification Condition is satisfied with respect thereto, (y)
with respect to collection procedures, the change is made with
prior written notice to the Trustee, Buyer and each Required
Person and no Material Adverse Effect would result and (z) with
respect to accounting policies relating to Receivables that have
become Write-Offs, the change is made in accordance with GAAP.
(c) Change in Payment Instructions to Obligors. Such
Seller will not (i) add or terminate any bank as an Account Bank
from those listed in the letter referred to in Section 5.1(o)
unless, prior to any such addition or termination, Buyer, the
Trustee, the Rating Agencies and the Required Persons shall have
received not less than ten Business Days' prior written notice of
the addition or termination and, not less than ten Business Days
prior to the effective date of any such proposed addition or
termination, Buyer and the Trustee shall have received (A)
counterparts of the applicable type of Account Agreement with
each new Account Bank, duly executed by such new Account Bank and
all other parties thereto, and (B) copies of all other agreements
and documents signed by
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the Account Bank and such other parties with respect to any new
Bank Account, all of which agreements and documents shall be
reasonably satisfactory in form and substance to Buyer and the
Trustee, or (ii) make any change in its instructions to Obligors,
given in accordance with Section 5.1(o), regarding payments to be
made to such Seller or payments to be made to any Account Bank,
other than changes in the instructions that direct Obligors to
make payments to another Bank Account at such Account Bank or
another Account Bank or to the Master Collection Account.
(d) Mergers, Acquisitions, Sales, etc. Except for
(i) mergers or consolidations in which such Seller is the
surviving Person, (ii) mergers or consolidations of a Subsidiary
of ICP into such Seller or (iii) mergers or consolidations in
which the surviving Person expressly assumes the performance of
this Agreement and the Modification Condition shall have been
satisfied with respect to the consolidation or merger, such
Seller will not be a constituent corporation to any merger or
consolidation. Such Seller will give the Rating Agencies, the
Trustee and each Required Person written notice of any such
permitted merger or consolidation promptly following completion
thereof. Unless the Modification Condition is satisfied, such
Seller will not, directly or indirectly, transfer, assign, convey
or lease, whether in one transaction or in a series of
transactions, all or substantially all of its assets or sell or
assign, with or without recourse, any Receivables or Related
Assets, in each case other than pursuant to this Agreement.
(e) Change in Name. Such Seller will not (i) change
its corporate name or (ii) change the name under or by which it
does business in any manner that would or may make any Public
Notice filed by such Seller in accordance herewith seriously
misleading within the meaning of Section 9-402(7) of an
applicable enactment of the UCC, in each case unless such Seller
shall have given Buyer, the Servicer, the Trustee, the Rating
Agencies and each Required Person 30 days' prior written notice
thereof and unless, prior to any change in name, such Seller
shall have taken and completed all action required by Section
7.3.
(f) Certificate of Limited Partnership. ICP will not
cause or permit Buyer to amend its Certificate of Limited
Partnership or partnership agreement without the prior written
consent of the Required Persons.
(g) Amendments to Transaction Documents. Such Seller
will not amend or otherwise modify or supplement any Transaction
Document to which it is a party unless (i) Buyer and the Trustee
shall have given prior written consent to each amendment,
modification or supplement and (ii) the Modification Condition
shall have been satisfied.
(h) Accounting for Purchases. Such Seller shall
prepare its financial statements in accordance with GAAP, and any
financial statements that are made publicly available and which
are consolidated to include Buyer will contain footnotes stating
that such Seller
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has sold or contributed its Receivables to Buyer and that the
assets of Buyer will not be available to ICP and its Subsidiaries
(other than Buyer) unless Buyer's liabilities have been paid in
full. Such Seller shall not prepare any financial statements
that account for the transactions contemplated in this Agreement
in any manner other than as a sale or contribution of Specified
Assets by such Seller to Buyer, or in any other respect account
for or treat the transactions contemplated in this Agreement
(including but not limited to accounting and, where taxes are not
consolidated, for tax reporting purposes) in any manner other
than as a sale or contribution of Specified Assets by such Seller
to Buyer.
(i) Discretionary Returns and Terminations of
Distributors. Such Seller will not allow any Discretionary
Returns or exercise its right to terminate a Distributor under a
Distributor Agreement unless it has complied with the provisions
of Section 3.2(k) of the Pooling Agreement.
ARTICLE VII
ADDITIONAL RIGHTS AND OBLIGATIONS IN
RESPECT OF THE SPECIFIED ASSETS
SECTION 7.1 Rights of Buyer. (a) Subject to Section 7.4(b),
each Seller hereby authorizes Buyer, the Servicer and/or their respective
designees to take any and all steps in such Seller's name and on behalf
of such Seller that Buyer, the Servicer and/or their respective designees
determine are reasonably necessary or appropriate to collect all amounts
due under any and all Specified Assets, including endorsing the name of
such Seller on checks and other instruments representing Collections and
enforcing such Seller's rights under such Specified Assets.
(b) Except as set forth in Section 3.1 with respect to payments
that Buyer shall have received on account of Seller Noncomplying
Receivables that had been the subject of an earlier Seller Noncomplying
Receivables Adjustment, Buyer shall have no obligation to account for any
Specified Asset to any Seller. Buyer shall have no obligation to account
for, or to return Collections, or any interest or other finance charge
collected pursuant thereto, to any Seller, irrespective of whether such
Collections and charges are in excess of the Purchase Price for the
Purchased Assets.
(c) Buyer shall have the unrestricted right to further assign,
transfer, deliver, hypothecate, subdivide or otherwise deal with the
Specified Assets, and all of Buyer's right, title and interest in, to and
under this Agreement, on whatever terms Buyer shall determine, pursuant
to the Pooling Agreement or otherwise.
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(d) Buyer shall have the sole right to retain any gains or
profits created by buying, selling or holding the Specified Assets and
shall have the sole risk of and responsibility for losses or damages
created by such buying, selling or holding.
SECTION 7.2 Responsibilities of the Sellers. Anything herein
to the contrary notwithstanding, each Seller hereby agrees:
(a) to deliver directly to the Servicer (for Buyer's
account), within two Business Days after receipt thereof, any
Collections that it receives, in the form so received, and agrees
that all such Collections shall be deemed to be received in trust
for Buyer and shall be maintained and segregated separate and
apart from all other funds and moneys of such Seller until
delivery of such Collections to the Servicer,
(b) to perform all of its obligations hereunder and
under the Contracts at least to the same extent as if the
Receivables had not been sold hereunder, and the exercise by
Buyer or its designee or assignee of Buyer's rights hereunder or
in connection herewith shall not relieve such Seller from any of
its obligations under the Contracts or Related Assets related to
the Receivables,
(c) that it hereby grants to Buyer an irrevocable power
of attorney, with full power of substitution, coupled with an
interest, to take in the name of such Seller all steps necessary
or advisable to endorse, negotiate or otherwise realize on any
writing or other right of any kind held or transmitted by such
Seller or transmitted or received by Buyer (whether or not from
such Seller) in connection with any Transferred Asset, and
(d) to the extent that such Seller does not own the
computer software that such Seller uses to account for
Receivables, such Seller shall provide Buyer, any Successor
Servicer and the Trustee with such licenses, sublicenses and/or
assignments of contracts as Buyer, such Successor Servicer or the
Trustee shall require with regard to all services and computer
hardware or software used by such Seller that relate to the
servicing of the Specified Assets.
SECTION 7.3 Further Action Evidencing Purchases. Each Seller
agrees that from time to time, at its expense, it will promptly, upon
reasonable request by Buyer, Servicer or Trustee, execute and deliver all
further instruments and documents, and take all further action, in order
to perfect, protect or more fully evidence the Purchase by Buyer or
contribution to Buyer of the Receivables and the Related Assets under this
Agreement (as applicable), or to enable Buyer to exercise or enforce any
of its rights under any Transaction Document. Each Seller further agrees
that from time to time, at its expense, it will promptly, upon request,
take all action that Buyer, the Servicer or the Trustee may reasonably
request in order to perfect, protect or more fully evidence the Purchase
or contribution of the Receivables and the Related
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Assets or to enable Buyer or the Trustee (as the assignee of Buyer) to
exercise or enforce any of its rights hereunder or under any other
Transaction Document. Without limiting the generality of the foregoing,
upon the request of Buyer or the Trustee, each Seller will:
(a) execute and file such Public Notices and such other
instruments or notices, as Buyer or the Trustee may reasonably
determine to be necessary or appropriate, and
(b) ▇▇▇▇ the master data processing records evidencing
the Receivables with the following legend:
"THE RECEIVABLES DESCRIBED HEREIN HAVE BEEN SOLD
TO INTER-CITY PRODUCTS RECEIVABLES COMPANY, L.P.
("BUYER") PURSUANT TO A RECEIVABLES PURCHASE
AGREEMENT, DATED AS OF JULY 25, 1996, AMONG
INTER-CITY PRODUCTS CORPORATION (USA), CERTAIN
OF ITS SUBSIDIARIES AND BUYER; AND SUCH
RECEIVABLES HAVE BEEN TRANSFERRED TO THE INTER-
CITY PRODUCTS MASTER TRUST PURSUANT TO A
POOLING AND SERVICING AGREEMENT, DATED AS OF THE
SAME DATE, AMONG BUYER, AS TRANSFEROR, INTER-
CITY PRODUCTS CORPORATION (USA) AS THE INITIAL
SERVICER, AND LASALLE NATIONAL BANK, AS
TRUSTEE."
Each Seller hereby authorizes Buyer or its designee to file one
or more Public Notices relative to all or any of the Receivables and
Related Assets of such Seller, in each case whether now existing or
hereafter generated by such Seller. Except for material performance
obligations of such Seller to any Obligor hereunder or under any of the
Contracts, if (i) such Seller fails to perform any of its agreements or
obligations under this Agreement and does not remedy the failure within
the applicable cure period, if any, and (ii) Buyer in good faith
reasonably believes that the performance of such agreements and
obligations is necessary or appropriate to protect its interests under
this Agreement, then Buyer or its designee may (but shall not be required
to) perform, or cause performance of, such agreement or obligation and the
reasonable expenses of Buyer or its designee or assignee incurred in
connection with such performance shall be payable by such Seller as
provided in Section 9.1.
SECTION 7.4 Collection of Receivables; Rights of Buyer and Its
Assignees. (a) Each Seller hereby transfers to the Trustee (as
transferee of Buyer's interest in the Specified Assets) the ownership of,
and the exclusive dominion and control over, each of the Bank Accounts and
all related lockboxes owned by such Seller, and such Seller hereby agrees
to take any further action that Buyer or the Trustee may reasonably
request in order to effect or complete the transfer. Each Seller further
agrees to use best efforts to prevent funds other than proceeds of the
Specified Assets from being deposited in any Bank Account.
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(b) Buyer may, at any time after an Early Amortization Event or
Servicer Default, direct the Obligors of Receivables, or any of them, to
pay all amounts payable under any Transferred Asset directly to the
Trustee or its designees. Furthermore, each Seller shall, at the request
of Buyer and at such Seller's expense, promptly give notice of the Trust's
interest in the Receivables of the Obligor and the Related Assets to each
such Obligor and direct that payments be made directly to the Trustee or
its designee, which notice shall be acceptable in form and substance to
Buyer. In addition, each Seller hereby authorizes Buyer to take any and
all steps in such Seller's name and on its behalf that are necessary or
desirable, in the reasonable determination of Buyer, to collect all
amounts due under any and all Specified Assets, including endorsing such
Seller's name on checks and other instruments representing Collections and
enforcing the Specified Assets and the Contracts related to the
Receivables. The Trustee may exercise any of the foregoing rights in the
place of Buyer (as assignee or otherwise) at any time following the
designation of a Servicer other than the Initial Servicer pursuant to
Section 10.2 of the Pooling Agreement.
(c) At any time when (i) an Early Amortization Event shall have
occurred and remain continuing or (ii) a Servicer other than the Initial
Servicer has been designated pursuant to Section 10.2 of the Pooling
Agreement, each Seller shall, at Buyer's request, assemble all of the
Records that evidence the Receivables and Related Assets originated by
such Seller, or that are otherwise necessary or desirable to collect the
Receivables or Related Assets, and make the same available to Buyer or the
Trustee at a place selected by the Trustee or its designee.
ARTICLE VIII
TERMINATION
SECTION 8.1 Automatic Termination. (a) This Agreement shall
terminate on the date on which the Pooling Agreement terminates in
accordance with its terms. Notwithstanding anything to the contrary in
this Agreement, if, at any time prior to such date, an event specified in
the definition of Bankruptcy Event occurs (without regard to the 60 day
grace period specified in paragraph (a) of that definition), then on and
after the date on which such bankruptcy proceeding is filed until the
dismissal of the proceeding Buyer shall not purchase Receivables and
Related Assets from such Seller.
(b) If the Internal Revenue Service or the PBGC files one or more
Tax or ERISA Liens against the assets of any Seller or Buyer (including
Receivables), then (unless such liens are removed and the Modification
Condition is satisfied) Buyer shall not purchase any Receivables or
Related Assets from such Seller (or from any Seller if such Lien is filed
against Buyer).
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ARTICLE IX
INDEMNIFICATION
SECTION 9.1 Indemnities by the Sellers. Without limiting any
other rights that any RPA Indemnified Party (as defined below) may have
hereunder or under applicable law, each Seller agrees to indemnify Buyer,
each of its successors, permitted transferees and assigns, and all
officers, directors, shareholders, controlling Persons, employees and
agents of any of the foregoing (each of the foregoing Persons being
individually called a "RPA Indemnified Party"), forthwith on demand, from
and against any and all damages, losses, claims (whether on account of
settlements or otherwise), judgments, liabilities and related reasonable
costs and expenses (including reasonable attorneys' fees and
disbursements) awarded against or incurred by any of them arising out of,
in connection with, or as a result of any of the following (all of the
foregoing being collectively called "RPA Indemnified Losses"):
(a) any representation or warranty by such Seller (or
any of its Authorized Officers) under any of the Transaction
Documents, any Monthly Report, any Daily Report or any other
information or report delivered by or on behalf of such Seller or
the Servicer with respect to such Seller or the Receivables or
Related Assets originated by such Seller (including without
limitation any representation, warranty, information or report
relied upon by Buyer in connection with the offering or sale of
any Certificate), that contained any untrue statement or omitted
to state facts necessary to make the statements not misleading
when made,
(b) the failure by such Seller to comply with any
applicable law, rule or regulation with respect to any Receivable
or any Related Asset or to comply with any Contract related
thereto, or the nonconformity of any Receivable, the related
Contract or any Related Assets with any such applicable law, rule
or regulation,
(c) the failure to vest and maintain vested in Buyer a
first priority perfected ownership interest in the Receivables
originated by such Seller and the Related Assets, free and clear
of any Adverse Claim (other than an Adverse Claim created in
favor of Buyer pursuant to this Agreement or in favor of the
Trustee pursuant to the Pooling Agreement), whether existing at
the time of the sale of such Receivable or at any time thereafter
and without regard to whether such Adverse Claim was a Permitted
Adverse Claim,
(d) any failure of such Seller to perform its duties or
obligations in accordance with the provisions of the Transaction
Documents,
(e) any products liability claim, personal injury or
property damage suit, environmental liability claim or any other
claim or action by a party other than Buyer of whatever sort,
whether sounding in tort, contract or any other legal theory,
arising out
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of or in connection with the goods or services that are the
subject of any Specified Assets with respect thereto,
(f) the failure to file, or any delay in filing, any
Public Notice with respect to any Specified Assets, whether at
the time of any sale or at any subsequent time,
(g) any dispute, claim, offset or defense (other than
the discharge in bankruptcy) of an Obligor to the payment of any
Receivable originated by such Seller or Related Asset, or
purported Receivable or Related Asset, including a defense based
on such Receivable's or the related Contract's not being a legal,
valid and binding obligation of the Obligor enforceable against
it in accordance with its terms, and
(h) any tax or governmental fee or charge (other than
franchise taxes and taxes on or measured by the net income of
Buyer or any of its assignees), all interest and penalties
thereon or with respect thereto, and all reasonable out-of-pocket
costs and expenses, including the reasonable fees and expenses of
counsel in defending against the same, that may arise by reason
of the purchase or ownership of the Receivables originated by
such Seller or any Related Asset connected with any such
Receivables.
Notwithstanding the foregoing (and with respect to clause (ii) below,
without prejudice to the rights that Buyer may have pursuant to the other
provisions of this Agreement or the provisions of any of the other
Transaction Documents), in no event shall any RPA Indemnified Party be
indemnified for any RPA Indemnified Losses (i) resulting from gross
negligence or willful misconduct on the part of the RPA Indemnified Party,
(ii) to the extent the same includes losses in respect of Receivables and
reimbursement therefor that would constitute credit recourse to such
Seller for the amount of any Receivable or Related Asset not paid by the
related Obligor, (iii) to the extent the same are or result from lost
profits (other than any breakage amounts or early termination amounts owed
to any RPA Indemnified Party) or (iv) to the extent the same are or result
from taxes on or measured by the net income of the RPA Indemnified Party.
If for any reason the indemnification provided above in this
section is unavailable to a RPA Indemnified Party or is insufficient to
hold a RPA Indemnified Party harmless, then such Seller shall contribute
to the maximum amount payable or paid to the RPA Indemnified Party as a
result of the loss, claim, damage or liability in such proportion as is
appropriate to reflect not only the relative benefits received by the RPA
Indemnified Party on the one hand and such Seller on the other hand, but
also the relative fault of the RPA Indemnified Party (if any) and such
Seller and any other relevant equitable considerations.
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ARTICLE X
MISCELLANEOUS
SECTION 10.1 Amendments; Waivers, Etc. (a) The provisions of
this Agreement may from time to time be amended, modified or waived, if
such amendment, modification or waiver is in writing and signed by Buyer
and each Seller (with respect to an amendment) or by Buyer (with respect
to a waiver or consent by it) and, in the case of any amendment,
modification or waiver, to the extent provided in Section 7.2(k) of the
Pooling Agreement, by the Trustee and each Required Person, and then any
such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given. This Agreement shall not
be amended unless Buyer shall have delivered the proposed amendment to the
Rating Agencies at least ten Business Days (or such shorter period as
shall be acceptable to each of them) prior to the execution and delivery
thereof and the Modification Condition has been satisfied with respect to
such amendment.
(b) No failure or delay on the part of Buyer, any RPA
Indemnified Party, the Trustee or any other third party beneficiary
referred to in Section 10.11(a) in exercising any power or right hereunder
shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power or right preclude any other or further exercise
thereof or the exercise of any other power or right. No notice to or
demand on any Seller in any case shall entitle it to any notice or demand
in similar or other circumstances. No waiver or approval by Buyer, the
Trustee or any Required Person under this Agreement shall, except as may
otherwise be stated in the waiver or approval, be applicable to subsequent
transactions. No waiver or approval under this Agreement shall require
any similar or dissimilar waiver or approval thereafter to be granted
hereunder.
SECTION 10.2 Notices, Etc. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in
writing (including facsimile communication) and shall be personally
delivered or sent by certified mail, postage prepaid, by facsimile or by
overnight courier, to the intended party at the address or facsimile
number of such party set forth under its name on the signature pages
hereof or at such other address or facsimile number as shall be designated
by the party in a written notice to the other parties hereto given in
accordance with this section. Copies of all notices and other
communications provided for hereunder shall be delivered to the Trustee,
the Rating Agencies and any Required Person at their respective addresses
for notices set forth in the Pooling Agreement. All notices and
communications provided for hereunder shall be effective, (a) if
personally delivered, when received, (b) if sent by certified mail, four
Business Days after having been deposited in the mail, postage prepaid and
properly addressed, (c) if transmitted by facsimile, when sent, receipt
confirmed by telephone or electronic means and (d) if sent by overnight
courier, two Business Days after having been given to the courier unless
sooner received by the addressee.
SECTION 10.3 Cumulative Remedies. The remedies herein provided
are cumulative and not exclusive of any remedies provided by law. Without
limiting the foregoing, each Seller
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hereby authorizes Buyer, at any time and from time to time, to the fullest
extent permitted by law, to set-off, against any Obligations of any Seller
to Buyer that are then due and payable or that are not then due and
payable from a Seller to Buyer but have then accrued, any and all
indebtedness or other obligations at any time owing to any Seller by Buyer
to or for the credit or the account of any Seller or that are not then due
and payable from Buyer to a Seller but have then accrued.
SECTION 10.4 Binding Effect; Assignability; Survival of
Provisions. This Agreement shall be binding upon and inure to the benefit
of Buyer and the Sellers and their respective successors and permitted
assigns (including, in the case of the Buyer, the Trustee). No Seller may
assign any of its rights hereunder or any interest herein without (i) the
prior written consent of Buyer and the Trustee and (ii) the satisfaction
of the Modification Condition. This Agreement shall create and constitute
the continuing obligations of the parties hereto in accordance with its
terms, and shall remain in full force and effect until the first date
following the Purchase Termination Date, but not later than the date on
which the Trust is terminated pursuant to Section 12.1 of the Pooling
Agreement, on which all Obligations shall have been finally and fully paid
and performed or such other time as the parties hereto shall agree and as
to which the Trustee (at the direction of the Majority Investors) shall
have given its prior written consent, which consent shall not be
unreasonably withheld or delayed. The rights and remedies with respect
to any breach of any representation and warranty made by a Seller pursuant
to Article V and the indemnification and payment provisions of Article IX
and Section 10.6 shall be continuing and shall survive any termination of
this Agreement.
SECTION 10.5 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES, EXCEPT (I) WITH RESPECT TO EACH SELLER, TO
THE EXTENT THAT THE PERFECTION AND THE EFFECT OF PERFECTION OR
NONPERFECTION OF THE SECURITY INTERESTS OF BUYER IN THE RECEIVABLES AND
THE RELATED ASSETS OF SUCH SELLER ARE GOVERNED BY THE LAWS OF A
JURISDICTION (SUCH SELLER'S "HOME STATE") OTHER THAN THE STATE OF NEW YORK
AND (II) WITH RESPECT TO EACH SELLER THE CREATION OF SUCH SECURITY
INTERESTS OF BUYER SHALL BE GOVERNED BY THE LAWS OF SUCH SELLER'S HOME
STATE.
SECTION 10.6 Costs, Expenses and Taxes. In addition to the
obligations of the Sellers under Article IX, the Sellers agree jointly and
severally to pay on demand:
(a) all reasonable out-of-pocket and other costs and
expenses in connection with the enforcement of this Agreement,
the Seller Assignment Certificates or the other Transaction
Documents by Buyer or any successor in interest to Buyer, and
(b) all stamp and other taxes and fees payable or
determined to be payable in connection with the execution and
delivery, and the filing and recording, of this
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Agreement or the other Transaction Documents, and agrees to
indemnify each RPA Indemnified Party against any liabilities with
respect to or resulting from any delay in paying or omission to
pay the taxes and fees.
SECTION 10.7 Submission to Jurisdiction. Each party hereto
hereby irrevocably submits to the non-exclusive jurisdiction of any New
York State or Federal court sitting in the Borough of Manhattan in the
City of New York, New York over any action or proceeding arising out of
or relating to the Transaction Documents, and hereby (A) irrevocably
agrees that all claims in respect of the action or proceeding may be heard
and determined in the state or Federal court, (B) irrevocably waives, to
the fullest extent it may effectively do so, the defense of an
inconvenient forum to the maintenance of the action or proceeding, and (C)
irrevocably consents to the service of any and all process in any action
or proceeding by the mailing of copies of the process to Buyer or a Seller
(as applicable) at its address specified herein.
Nothing in this section shall affect the right of any party hereto
to serve legal process in any other manner permitted by law or affect the
right of any party hereto to bring any action or proceeding against the
other party or any of its properties in the courts of any other
jurisdiction.
SECTION 10.8 Waiver of Jury Trial. Each party hereto waives any
right to a trial by jury in any action or proceeding to enforce or defend
any rights under or relating to the Transaction Documents or any
amendment, instrument, document or agreement delivered or that may in the
future be delivered in connection therewith or arising from any course of
conduct, course of dealing, statements (whether verbal or written),
actions of either of the parties hereto or any other relationship existing
in connection with the Transaction Documents, and agrees that any such
action or proceeding shall be tried before a court and not before a jury.
SECTION 10.9 Integration. This Agreement and the other
Transaction Documents contain a final and complete integration of all
prior expressions by the parties hereto with respect to the subject matter
hereof and thereof and shall together constitute the entire agreement
between the parties hereto with respect to the subject matter hereof and
thereof, superseding all prior oral or written understandings.
SECTION 10.10 Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which together shall constitute one and the same
agreement.
SECTION 10.11 Acknowledgment and Consent. (a) The Sellers
acknowledge that, contemporaneously herewith, Buyer is selling,
transferring, assigning, setting over and otherwise conveying to the Trust
all of Buyer's right, title and interest in, to and under the Specified
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Assets, this Agreement and all of the other Transaction Documents pursuant
to Sections 2.1 and 2.4 of the Pooling Agreement. The Sellers hereby
consent to the sale, transfer, assignment, set over and conveyance to the
Trust by Buyer of all right, title and interest of Buyer in, to and under
the Specified Assets, this Agreement and the other Transaction Documents,
and all of Buyer's rights, remedies, powers and privileges, and all claims
of Buyer against the Sellers, under or with respect to this Agreement and
the other Transaction Documents (whether arising pursuant to the terms of
this Agreement or otherwise available at law or in equity), including (i)
the right of Buyer, at any time, to enforce this Agreement against the
Sellers and the obligations of the Sellers hereunder, (ii) the right to
appoint a successor to the Servicer at the times and upon the conditions
set forth in the Pooling Agreement, and (iii) the right, at any time, to
give or withhold any and all consents, requests, notices, directions,
approvals, demands, extensions or waivers under or with respect to this
Agreement, any other Transaction Document or the obligations in respect
of the Sellers thereunder to the same extent as Buyer may do. Each of the
parties hereto acknowledges and agrees that the Trustee and the Trust are
third party beneficiaries of the rights of Buyer arising hereunder and
under the other Transaction Documents to which any Seller is a party
except to the extent the Trustee's rights have been expressly limited
hereunder. Each Seller hereby acknowledges and agrees that it has no
claim to or interest in any of the Bank Accounts or the Trust Accounts.
(b) The Sellers hereby agree to execute all agreements,
instruments and documents, and to take all other action, that Buyer or the
Trustee reasonably determines is necessary or appropriate to evidence its
consent described in subsection (a) above. To the extent that Buyer,
individually or through the Servicer, has granted or grants powers of
attorney to the Trustee under the Pooling Agreement, the Sellers hereby
grant a corresponding power of attorney on the same terms to Buyer. The
Sellers hereby acknowledge and agree that Buyer, in all of its capacities,
shall assign to the Trustee for the benefit of the Certificateholders the
powers of attorney and other rights and interests granted by the Sellers
to Buyer hereunder and agrees to cooperate fully with the Trustee in the
exercise of the rights.
SECTION 10.12 No Partnership or Joint Venture. Nothing contained
in this Agreement shall be deemed or construed by the parties hereto or
by any third person to create the relationship of principal and agent or
of partnership or of joint venture.
SECTION 10.13 No Proceedings. Each Seller hereby agrees that it
will not institute against Buyer or the Trust, or join any other Person
in instituting against Buyer or the Trust, any insolvency proceeding (such
as any proceeding of the type referred to in the definition of Event of
Bankruptcy) so long as any Investor Certificates issued by the Trust shall
be outstanding or there shall not have elapsed one year plus one day since
the last day on which any such Investor Certificates shall have been
outstanding. The foregoing shall not limit the right of a Seller to file
any claim in or otherwise take any action with respect to any insolvency
proceeding that was instituted against Buyer or the Trust by any Person
other than a Seller or any other Related Person (provided that no such
action may be taken by a Seller until such proceeding has continued
undismissed, unstayed and in effect for a period of 10 days).
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SECTION 10.14 Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement or any
of the other Transaction Documents shall for any reason whatsoever be held
invalid, then the unenforceable covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement or the other Transaction Documents
(as applicable) and shall in no way affect the validity or enforceability
of the other provisions of this Agreement or any of the other Transaction
Documents.
SECTION 10.15 Recourse to Buyer. Except to the extent expressly
provided otherwise in the Transaction Documents, the obligations of Buyer
under the Transaction Documents to which it is a party are solely the
obligations of Buyer. No recourse shall be had for payment of any fee
payable by or other obligation of or claim against Buyer that arises out
of any Transaction Document to which Buyer is a party against any
director, officer or employee of Buyer. The provisions of this section
shall survive the termination of this Agreement.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
INTER-CITY PRODUCTS CORPORATION (USA),
as Seller
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
------------------------------------
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
INTER-CITY PRODUCTS PARTNER CORPORATION,
as Seller
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
GENERAL HEATING AND COOLING COMPANY,
as Seller
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
COASTLINE DISTRIBUTION, INC., as Seller
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
INTER-CITY PRODUCTS
RECEIVABLES COMPANY, L.P.,
as the Buyer
By: Inter-City Products Partner Corporation,
its general partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------------
Title: Senior Vice President
Address: ▇▇▇ ▇▇▇▇-▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
EXHIBIT A
to Receivables Purchase Agreement
FORM OF BUYER NOTE
___________, 1996
FOR VALUE RECEIVED, the undersigned, INTER-CITY PRODUCTS
RECEIVABLES COMPANY, L.P., a Tennessee limited partnership ("Buyer"),
promises to pay to _________________________, a ____________ corporation
(the "Seller" and together with its successors and assigns, the "Holder"),
on the terms and subject to the conditions set forth in this promissory
note (this "Note") and in the Receivables Purchase Agreement, dated as of
July 25, 1996 (the "Agreement") among Buyer, Inter-City Products
Corporation (USA), ("ICP") and certain of its Subsidiaries, an amount
equal to the aggregate deferred Purchase Price owed by Buyer to the Seller
pursuant to Article III of the Agreement. Such amount, as shown in the
records of the Servicer, will be rebuttable presumptive evidence of the
principal amount and interest owing under this Note.
1. Purchase Agreement. This Note is a Buyer Note described in,
and is subject to the terms and conditions set forth in, the Agreement.
Reference is hereby made to the Agreement for a statement of certain other
rights and obligations of Buyer and the Seller.
2. Rules of Construction; Definitions. Certain rules of
construction governing the interpretation of this Note are as set forth
in Appendix A to the Pooling Agreement (as defined in the Agreement) and,
except as otherwise specifically provided herein, capitalized terms used
but not defined herein have the meanings ascribed to them in such Appendix
A. In addition, as used herein, the following terms have the following
meanings:
"Bankruptcy Proceedings" means any dissolution, winding
up, liquidation, readjustment, reorganization or other similar
event relating to Buyer, whether voluntary or involuntary,
partial or complete, and whether in bankruptcy, insolvency,
receivership or other similar proceedings, or upon an assignment
for the benefit of creditors, or any other marshalling of the
assets and liabilities of Buyer or any sale of all or
substantially all of the assets of Buyer; provided, however, that
none of the following shall constitute a "Bankruptcy Proceeding"
so long as no Bankruptcy Event shall have occurred with respect
to the Buyer and is continuing: (i) the commencement of an
amortization period, accumulation period or early amortization
period, (ii) the allocation and distribution of Collections and
other amounts during an amortization period, accumulation period
or early amortization period in accordance with the terms of the
Pooling Agreement and (iii)
A-1
the liquidation, dissolution and winding up of Buyer during an
amortization period, accumulation period or early amortization
period in accordance with the Pooling Agreement after the
termination of the Pooling Agreement in accordance with Section
12.1 thereof.
"Final Maturity Date" means the date occurring one year
and one day after the Final Scheduled Payment Date of the latest
maturing Series from time to time outstanding.
"Highest Lawful Rate" has the meaning set forth in
paragraph 9.
"Junior Liabilities" means all obligations of Buyer to
the Holder under this Note.
"Reference Rate" means, with respect to any day occurring
in a Calculation Period, the rate of interest publicly announced
from time to time by the Trustee as its "reference rate" or
"prime rate" and in effect on the first day of such Calculation
Period, as determined by the Servicer.
"Senior Interests" means all obligations of Buyer to the
Trustee or the Investor Certificateholders under or in connection
with the Transaction Documents, whether direct or indirect,
absolute or contingent, now or hereafter existing, or due or to
become due, including without limitation interest or other
amounts due or to become due after an Event of Bankruptcy.
"Subordination Provisions" means, collectively, the
provisions of paragraph 7.
3. Interest. Subject to the Subordination Provisions, Buyer
promises to pay interest on the aggregate unpaid principal amount of this
Note outstanding on each day at an adjustable rate per annum equal to the
Reference Rate in effect on such day.
4. Interest Payment Dates. (a) Subject to the Subordination
Provisions, Buyer shall pay accrued interest on this Note on each
Distribution Date and on the Final Maturity Date. Buyer also shall pay
accrued interest on the principal amount of each prepayment hereof on the
date of such prepayment.
(b) Notwithstanding the provisions of paragraph 4(a), in the
event that on the date an interest payment is due hereunder the amount of
funds available therefor pursuant to Section 3.3 of the Agreement is
insufficient to pay any amount due pursuant to paragraph 4(a), then
interest shall be payable only to the extent that funds are available
therefor in accordance with Section 3.3 of the Agreement. All interest
on this Note that is not paid when due pursuant to this paragraph shall
be payable on the next date on which an interest payment on this Note is
due and on which funds are available therefor pursuant to Section 3.3 of
the Agreement, and all such unpaid interest shall accrue interest at the
Reference Rate until paid in full.
A-2
5. Basis of Computation. Interest accrued hereunder shall be
computed for the actual number of days elapsed on the basis of a 360-day
year.
6. Principal Payment Dates. Subject to the Subordination
Provisions, any unpaid principal of this Note shall only become due and
payable on the Final Maturity Date. Subject to the Subordination
Provisions, the principal amount of and accrued interest on this Note may
be prepaid on any Business Day without premium or penalty; provided, that
no prepayment shall be made by Buyer to the extent that such prepayment
would result in a default in the payment of any other amount required to
be paid by Buyer under any Transaction Document.
7. Subordination Provisions. Buyer covenants and agrees, and the
Holder, by its acceptance of this Note, likewise covenants and agrees,
that the payment of all Junior Liabilities is hereby expressly
subordinated in right of payment to the payment and performance of the
Senior Interests to the extent and in the manner set forth in this
paragraph:
(a) In the event of any Bankruptcy Proceeding, the
Senior Interests shall first be paid and performed in full and in
cash before the Holder shall be entitled to receive and to retain
any payment or distribution in respect of the Junior Liabilities.
In order to implement the foregoing: (i) all payments and
distributions of any kind or character in respect of the Junior
Liabilities to which the Holder would be entitled except for this
clause (a) shall be made directly to the Trustee (for the benefit
of itself and the Investor Certificateholders), and (ii) if a
Bankruptcy Proceeding has been commenced, the Holder shall
promptly file a claim or claims, in the form required in any
Bankruptcy Proceedings, for the full outstanding amount of the
Junior Liabilities, and shall use commercially reasonable efforts
to cause said claim or claims to be approved and all payments and
other distributions in respect thereof to be made directly to the
Trustee (for the benefit of itself and the Investor
Certificateholders) until the Senior Interests shall have been
paid and performed in full and in cash.
(b) In the event that the Holder receives any payment
or other distribution of any kind or character from Buyer or from
any other source whatsoever, in payment of the Junior
Liabilities, after the commencement of any Bankruptcy Proceeding,
such payment or other distribution shall be received in trust for
the Trustee and the Investor Certificateholders and shall be
turned over by the Holder to the Trustee forthwith.
(c) Upon the date that is a year and a day after the
final payment in full and in cash of all Senior Interests, the
Holder shall be subrogated to the rights of the Trustee and the
Investor Certificateholders to receive payments or distributions
from Buyer that are applicable to the Senior Interests until the
Junior Liabilities are paid in full.
(d) These Subordination Provisions are intended solely
for the purpose of defining the relative rights of the Holder, on
the one hand, and the Trustee and the Investor Certificateholders
on the other hand. Nothing contained in these Subordination
A-3
Provisions or elsewhere in this Note is intended to or shall
impair, as between Buyer, its creditors (other than the Trustee
and the Investor Certificateholders) and the Holder, Buyer's
obligation, which is unconditional and absolute, to pay the
Junior Liabilities as and when the same shall become due and
payable in accordance with the terms hereof and of the Agreement
or to affect the relative rights of the Holder and creditors of
Buyer (other than the Trustee and the Investor
Certificateholders).
(e) Except as otherwise permitted in Section 10.4 of
the Agreement, the Holder shall not, until the Senior Interests
have been finally paid and performed in full and in cash, (i)
cancel, waive, forgive, transfer or assign, or commence legal
proceedings to enforce or collect, or subordinate to any
obligation of Buyer (other than to the Senior Interests),
howsoever created, arising or evidenced, whether direct or
indirect, absolute or contingent, or now or hereafter existing,
or due or to become due, the Junior Liabilities or any rights in
respect hereof or (ii) convert the Junior Liabilities into an
equity interest in Buyer, unless, in the case of each of clauses
(i) and (ii), the Holder shall have received the prior written
consent of the Trustee in each case.
(f) The Holder shall not, without the advance written
consent of the Trustee, commence, or join with any other Person
in commencing, any Bankruptcy Proceedings with respect to Buyer
until at least one year and one day shall have passed after the
Senior Interests shall have been finally paid and performed in
full and in cash; provided, however, that the Holder shall at all
times have the right to file any claim in or otherwise take any
action with respect to any insolvency proceeding instituted
against Buyer by any Person other than the Holder or any other
Related Person (provided that no such action may be taken by the
Holder until such proceeding has continued undismissed, unstayed
and in effect for a period of 10 days).
(g) If, at any time, any payment (in whole or in part)
made with respect to any Senior Interest is rescinded or must be
restored or returned by a Certificateholder (whether in
connection with any Bankruptcy Proceedings or otherwise), these
Subordination Provisions shall continue to be effective or shall
be reinstated, as the case may be, as though such payment had not
been made.
(h) Each of the Trustee and the Investor
Certificateholders may, from time to time, in its sole
discretion, without notice to the Holder, and without waiving any
of its rights under these Subordination Provisions, take any or
all of the following actions: (i) retain or obtain an interest in
any property to secure any of the Senior Interests, (ii) retain
or obtain the primary or secondary obligations of any other
obligor or obligors with respect to any of the Senior Interests,
(iii) extend or renew for one or more periods (whether or not
longer than the original period), alter, increase or exchange any
of the Senior Interests, or release or compromise any obligation
of any nature with respect to any of the Senior Interests, (iv)
amend, supplement, amend and restate, or otherwise modify any
Transaction Document to which it is a party, and (v) release its
security
A-4
interest in, or surrender, release or permit any substitution or exchange
for all or any part of any rights or property securing any of the Senior
Interests, or extend or renew for one or more periods (whether or not
longer than the original period), or release, compromise, alter or
exchange any obligations of any nature of any obligor with respect to any
such rights or property.
(i) The Holder hereby waives: (i) notice of acceptance
of these Subordination Provisions by the Trustee or any of the
Investor Certificateholders, (ii) notice of the existence,
creation, non-payment or non-performance of all or any of the
Senior Interests, and (iii) all diligence in enforcement,
collection or protection of, or realization upon, the Senior
Interests, or any thereof, or any security therefor.
(j) These Subordination Provisions constitute a
continuing offer from Buyer to all Persons who become the holders
of, or who continue to hold, Senior Interests, and these
Subordination Provisions are made for the benefit of the Trustee
and the Investor Certificateholders, and the Trustee may proceed
to enforce such provisions on behalf of each of such Persons.
8. General. No failure or delay on the part of the Holder in
exercising any power or right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power or right
preclude any other or further exercise thereof or the exercise of any
other power or right. No amendment, modification or waiver of, or consent
with respect to, any provision of this Note shall in any event be
effective unless (a) the same shall be in writing and signed and delivered
by Buyer and the Seller, and (b) all consents required for such actions
under the Transaction Documents shall have been received by the
appropriate Persons.
9. Limitation on Interest. Notwithstanding anything in this Note
to the contrary, Buyer shall never be required to pay unearned interest
on any amount outstanding hereunder, and shall never be required to pay
interest on the principal amount outstanding hereunder, at a rate in
excess of the maximum nonusurious interest rate that may be contracted
for, charged or received under applicable federal or state law (such
maximum rate being herein called the "Highest Lawful Rate"). If the
effective rate of interest that would otherwise be payable under this Note
would exceed the Highest Lawful Rate, or the Holder shall receive any
unearned interest or shall receive monies that are deemed to constitute
interest that would increase the effective rate of interest payable by
Buyer under this Note to a rate in excess of the Highest Lawful Rate, then
(a) the amount of interest that would otherwise be payable by Buyer under
this Note shall be reduced to the amount allowed by applicable law, and
(b) any unearned interest paid by Buyer or any interest paid by Buyer in
excess of the Highest Lawful Rate shall be refunded to Buyer. Without
limitation of the foregoing, all calculations of the rate of interest
contracted for, charged or received by the Holder under this Note that are
made for the purpose of determining whether such rate exceeds the Highest
Lawful Rate shall be made, to the extent permitted by applicable usury
laws (now or hereafter enacted), by amortizing, prorating and spreading
in equal parts during the actual period during which any amount has been
outstanding hereunder all interest
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at any time contracted for, charged or received by the Holder in
connection herewith. If at any time and from time to time (i) the amount
of interest payable to the Holder on any date shall be computed at the
Highest Lawful Rate pursuant to the provisions of the foregoing sentence,
and (ii) in respect of any subsequent interest computation period the
amount of interest otherwise payable to the Holder would be less than the
amount of interest payable to the Holder computed at the Highest Lawful
Rate, then the amount of interest payable to the Holder in respect of such
subsequent interest computation period shall continue to be computed at
the Highest Lawful Rate until the total amount of interest payable to the
Holder shall equal the total amount of interest that would have been
payable to the Holder if the total amount of interest had been computed
without giving effect to the provisions of the foregoing sentence.
10. No Negotiation. This Note is not negotiable.
11. Governing Law. THIS NOTE SHALL BE DEEMED TO BE A CONTRACT
MADE UNDER AND CONSTRUED IN ACCORDANCE WITH THE AGREEMENT AND THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES.
12. Security Interest. The Seller may grant a security interest
in or otherwise pledge this Note as security, and any Person to whom such
security interest is granted or to whom this Note is pledged shall be
bound by, and for all purposes takes this Note subject to, the
restrictions and other provisions (including the Subordination Provisions)
set forth herein.
13. Captions. Paragraph captions used in this Note are provided
solely for convenience of reference and shall not affect the meaning or
interpretation of any provision of this Note.
INTER-CITY PRODUCTS
RECEIVABLES COMPANY, L.P.
By: Inter-City Products Partner Corporation
By:
--------------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
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EXHIBIT B
EXHIBIT B
to Receivables Purchase Agreement
FORM OF
SELLER ASSIGNMENT CERTIFICATE
Reference is made to the Receivables Purchase Agreement, dated as
of July 25, 1996 (as the same may be amended, supplemented, amended and
restated or otherwise modified from time to time, the "Agreement") between
INTER-CITY PRODUCTS CORPORATION (USA), CERTAIN OF ITS SUBSIDIARIES and
INTER-CITY PRODUCTS RECEIVABLES COMPANY, L.P. ("Buyer"). Unless otherwise
defined herein, capitalized terms used herein have the meanings ascribed
to them pursuant to the Agreement.
The undersigned (the "Seller") hereby sells, transfers, assigns,
sets over and conveys unto Buyer and its successors and assigns all right,
title and interest of the Seller in, to and under:
(a) all Receivables of the Seller (other than
Contributed Receivables) that existed and was owing to the Seller
as at the closing of the Seller's business on the Initial Cut-Off
Date,
(b) all Receivables created by the Seller (other than
Contributed Receivables) that arise during the period from and
including the closing of the Seller's business on the Initial
Cut-Off Date to but excluding the Purchase Termination Date,
(c) all Related Security with respect to all Receivables
(other than Contributed Receivables) of the Seller,
(d) all proceeds of the foregoing, including all funds
received by any Person in payment of any amounts owed (including
invoice prices, finance charges, interest and all other charges,
if any) in respect of any Receivable described above (other than
a Contributed Receivable) or Related Security with respect to any
such Receivable, or otherwise applied to repay or discharge any
such Receivable (including insurance payments that the Seller or
the Servicer applies in the ordinary course of its business to
amounts owed in respect of any such Receivable and net proceeds
of any sale or other disposition of repossessed goods that were
the subject of any such Receivable) or other collateral or
property of any Obligor or any other party directly or indirectly
liable for payment of such Receivables, and
(e) all Records relating to any of the foregoing.
B-1
This Seller Assignment Certificate is made without recourse but
on the terms and subject to the conditions set forth in the Transaction
Documents to which the Seller is a party. The Seller acknowledges and
agrees that Buyer is accepting this Seller Assignment Certificate in
reliance on the representations, warranties and covenants of the Seller
contained in the Transaction Documents to which the Seller is a party.
THIS SELLER ASSIGNMENT CERTIFICATE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE AGREEMENT AND THE INTERNAL LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.
IN WITNESS WHEREOF, the undersigned has caused this Seller
Assignment Certificate to be duly executed and delivered by its duly
Authorized Officer this _____ day of _______________, 1996.
[SELLER'S FULL NAME]
By:
------------------------------
Title:
----------------------------
SCHEDULE 1
to Receivables Purchase Agreement
LITIGATION AND OTHER PROCEEDINGS
[OMITTED]
SCHEDULE 2
to Receivables Purchase Agreement
CHANGES IN FINANCIAL CONDITION
[OMITTED]
SCHEDULE 3
to Receivables Purchase Agreement
OFFICES OF THE SELLERS WHERE
RECORDS ARE MAINTAINED
[OMITTED]
SCHEDULE 4
to Receivables Purchase Agreement
LEGAL NAMES
TRADE NAMES
[OMITTED]
SCHEDULE 5
to Receivables Purchase Agreement
SOFTWARE LICENSES
[OMITTED]