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AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
among
ENTERPRISE FUNDING CORPORATION,
as Company
TECH DATA FINANCE, INC.
as Transferor
and
TECH DATA CORPORATION,
as Collection Agent and Guarantor
and
NATIONSBANK, N.A.,
as Agent and a Bank Investor
Dated as of January 21, 1997
--------------------------------------------------------------------------------
0104420.05-01S7a
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Defined Terms......................................... 1
SECTION 1.2. Other Terms................................................... 29
SECTION 1.3. Computation of Time Periods................................... 29
ARTICLE II
PURCHASES AND SETTLEMENTS
SECTION 2.1. Facility...................................................... 30
SECTION 2.2. Transfers; Certificates;
Eligible Receivables............................. 30
SECTION 2.3. Selection of Tranche Periods and
Tranche Rates.................................... 35
SECTION 2.4. Discount, Fees and Other Costs and
Expenses......................................... 39
SECTION 2.5. Non-Liquidation Settlement and
Reinvestment Procedures.......................... 39
SECTION 2.6. Liquidation Settlement Procedures............................. 40
SECTION 2.7. Fees.......................................................... 42
SECTION 2.8. Protection of Ownership Interest of the
Company and the Bank Investors................... 42
SECTION 2.9. Deemed Collections; Application of
Payments......................................... 44
SECTION 2.10. Payments and Computations, Etc................................ 45
SECTION 2.11. Reports....................................................... 46
SECTION 2.12. Collection Account............................................ 46
SECTION 2.13. Sharing of Payments, Etc...................................... 46
SECTION 2.14. Rights of Set-off............................................. 47
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the
Transferor....................................... 48
SECTION 3.2. Reaffirmation of Representations and
Warranties by the Transferor..................... 52
0104420.05-01S7a
i
SECTION 3.3. Representations and Warranties of Tech
Data, as Collection Agent and
Guarantor........................................ 52
SECTION 3.4 Reaffirmation of Representations
and Warranties by Tech Data, as
Collection Agent and Guarantor................... 55
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1. Conditions to Closing......................................... 56
SECTION 4.2. Post Closing Conditions....................................... 59
ARTICLE V
COVENANTS
SECTION 5.1. Affirmative Covenants of Transferor........................... 60
SECTION 5.2. Negative Covenants of Transferor.............................. 63
SECTION 5.3. Affirmative Covenants of Tech Data............................ 65
SECTION 5.4. Negative Covenants of Tech Data............................... 68
SECTION 5.5. Financial Covenants........................................... 70
ARTICLE VI
ADMINISTRATION AND COLLECTIONS
SECTION 6.1. Appointment of Collection Agent............................... 71
SECTION 6.2. Duties of Collection Agent.................................... 71
SECTION 6.3. Rights After Designation of New
Collection Agent................................. 74
SECTION 6.4. Responsibilities of the Transferor
and Tech Data.................................... 75
ARTICLE VII
TERMINATION EVENTS
SECTION 7.1. Termination Events............................................ 76
SECTION 7.2. Termination................................................... 78
ARTICLE VIII
INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 8.1. Indemnities by the Transferor................................. 80
0104420.05-01S7a
ii
SECTION 8.2. Indemnity for Taxes, Reserves and
Expenses......................................... 82
SECTION 8.3. Other Costs, Expenses and Related
Matters.......................................... 84
SECTION 8.4. Reconveyance Under Certain
Circumstances.................................... 85
ARTICLE IX
GUARANTEE
SECTION 9.1. Guaranty of Obligations....................................... 87
SECTION 9.2. Validity of Obligations;
Irrevocability................................... 87
SECTION 9.3. Rights of Set-Off............................................. 88
ARTICLE X
THE AGENT; BANK COMMITMENT
SECTION 10.1. Authorization and Action..................................... 89
SECTION 10.2. Agent's Reliance, Etc........................................ 91
SECTION 10.3. Credit Decision.............................................. 91
SECTION 10.4. Indemnification of the Agent..................................92
SECTION 10.5. Successor Agent.............................................. 92
SECTION 10.6. Payments by the Agent........................................ 93
SECTION 10.7. Bank Commitment; Assignment to
Bank Investors.................................. 94
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Term of Agreement............................................ 99
SECTION 11.2. Waivers; Amendments.......................................... 99
SECTION 11.3. Notices ..................................................... 99
SECTION 11.4. Governing Law; Submission to
Jurisdiction; Integration......................101
SECTION 11.5. Severability; Counterparts...................................102
SECTION 11.6. Successors and Assigns.......................................102
SECTION 11.7. Waiver of Confidentiality....................................103
SECTION 11.8. Confidentiality Agreement....................................103
SECTION 11.9. No Bankruptcy Petition Against the
Company........................................103
SECTION 11.10. No Recourse Against Stockholders,
Officers or Directors..........................103
SECTION 11.11. Characterization of the Transactions
0104420.05-01S7a
iii
Contemplated by the Agreement..................104
SECTION 11.12. Optional Reconveyance of All
Receivables....................................104
SECTION 11.13. Mandatory Reconveyance of Certain
Receivables....................................105
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
AMENDED AND RESTATED TRANSFER AND ADMINISTRATION AGREEMENT
(this "Agreement"), dated as of January 21, 1997 among TECH DATA CORPORATION, a
Florida corporation ("Tech Data"), as collection agent and guarantor (in such
capacities, the "Collection Agent" and the "Guarantor", respectively), TECH DATA
FINANCE, INC., a Califor- nia corporation, as transferor (in such capacity, the
"Transferor"), ENTERPRISE FUNDING CORPORATION, a Delaware corporation (the
"Company"), and NATIONSBANK, N.A., a national banking association
("NationsBank"), as agent for the Company and the Bank Investors (in such
capacity, the "Agent") and as a Bank Investor, amending and restating that
certain Transfer and Administration Agreement among Tech Data, as collection
agent and guarantor, the Transferor and Company dated as of December 23, 1993,
and as amended to the date hereof.
PRELIMINARY STATEMENTS
WHEREAS, the Transferor may desire to convey, transfer and
assign, from time to time, undivided percentage interests in certain accounts
receivable, and the Company may desire to, and the Bank Investors, if requested
shall, accept such conveyance, transfer and assignment of such undivided
percentage interests, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Defined Terms. As used
in this Agreement, the following terms shall have the
following meanings:
0104420.05-01S7a
"Administrative Agent" means NationsBank, N.A.,
as administrative agent.
"Adverse Claim" means a lien, security interest, charge or
encumbrance, or other right or claim in, of or on any Person's assets or
properties in favor of any other Person (including any UCC financing statement
or any similar instrument filed against such Person's assets or properties).
"Affected Assets" means, collectively, the
Receivables and the Related Security, Collections and Proceeds relating thereto.
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such Person. A Person shall be deemed to control
another Person if the controlling Person possesses, directly or indirectly, the
power to direct or cause the direction of the management or policies of the
controlled Person, whether through ownership of voting stock, by contract or
otherwise.
"Affiliated Obligor" means any Obligor which is
an Affiliate of another Obligor.
"Agent" means NationsBank, N.A., in its capacity as agent for
the Company and the Bank Investors, and any successor thereto appointed pursuant
to Article X.
"Aggregate Unpaids" means, at any time, an amount equal to the
sum of (i) the aggregate accrued and unpaid Discount with respect to all Tranche
Periods at such time, (ii) the Net Investment at such time, and (iii) all other
amounts owed (whether due or accrued) hereunder by Transferor to the Company at
such time.
0104420.05-01S7a
2
"Applicable Margin" means the percent per annum set forth
below in the case of a Eurodollar Tranche or a CD Tranche, which percent shall
be the Applicable Margin effective with Tranche Periods commencing after the
first day next following the delivery by the Transferor of the quarterly
certificate referred to in Section 5.3(a)(iii) hereof demonstrating that (i) the
ratio of Consolidated Total Funded Indebtedness to Consolidated Total Capital
(each as defined in Exhibit N attached hereto) is less than or equal to or more
than, as the case may be, or (ii) the ratio of Consolidated EBIT to Consolidated
Interest Expense (each as defined in Exhibit N attached hereto) is greater than
or equal to or less than, as the case may be, the applicable ratio set forth
opposite such Applicable Margin (provided that if such determination shall
result in more than one Applicable Margin, the lower Applicable Margin shall
apply):
=======================================================================
|Ratio of | OR | Ratio of | Eurodol- | CD |
|EBIT to | -- | Debt to | lar | Tranche |
|Interest | | Capital | Tranche | Applica- |
| | | | | ble Mar- |
| | | | | gin |
| | | | | |
|-----------|---------|---------------|--------------|----------------|
|Less than | | Less than | .550% | .675% |
|3.0 to | | .60 to | | |
|1.00 | | 1.00 but | | |
| | | equal to | | |
| | | or great- | | |
| | | er than | | |
| | | .55 to | | |
| | | 1.00 | | |
|-----------|---------|---------------|--------------|----------------|
|Greater | | Less than | .450% | .575% |
|than or | | .55 to | | |
|equal to | | 1.00 but | | |
|3.0 to | | equal to | | |
|1.00 but | | or great- | | |
|less than | | er than | | |
|4.0 to | | .50 to | | |
|1.00 | | 1.00 | | |
|---------------------------------------------------------------------|
0104420.05-01S7a
3
|-----------|---------|---------------|--------------|----------------|
|Greater | | Less than | .400% | .525% |
|than or | | .50 to | | |
|equal to | | 1.00 but | | |
|4.0 but | | equal to | | |
|less than | | or great- | | |
|5.0 to | | er than | | |
|1.0 | | .45 to | | |
| | | 1.00 | | |
|-----------|---------|---------------|--------------|----------------|
|Greater | | Less than | .375% | .500% |
|than or | | .45 to | | |
|equal to | | 1.00 | | |
|5.0 to | | | | |
|1.00 | | | | |
| | | | | |
| | | | | |
| | | | | |
=======================================================================
Notwithstanding the foregoing, if Tech Data fails to deliver any such quarterly
certificate when required pursuant to Section 5.3(a)(iii) hereof, then the
Applicable Margin for any Eurodollar Tranche or CD Tranche shall be the highest
Applicable Margin for such type of Tranche set forth above until such quarterly
certificate is so delivered. From the Closing Date to the first date such
quarterly certificate is required to be delivered, the Applicable Margin shall
be .525% for CD Tranches and .40% for Eurodollar Tranches.
"Assignment Amount" with respect to a Bank Investor shall mean
at any time an amount equal to the lesser of (i) such Bank Investor's Pro Rata
Share of the Net Investment at such time and (ii) such Bank Investor's unused
Commitment.
"Assignment and Assumption Agreement" means an
Assignment and Assumption Agreement substantially in the
form of Exhibit G attached hereto.
"Average Collection Period" means at any time a period of days
equal to the product of (i) a fraction the numerator of which shall be the
amount set forth in the most recent Investor Report as the "Beginning Balance"
of the Receivables and the denominator of which shall be the Collections as set
forth in the most recent Investor Report and (ii) thirty (30).
"Bank Investors" shall mean NationsBank, N.A.
and its successors and assigns.
0104420.05-01S7a
4
"Base Rate" or "BR" means, a rate per annum equal to the
greater of (i) the prime rate of interest announced by the Liquidity Provider
(or, if more than one Liquidity Provider, then by NationsBank) from time to
time, changing when and as said prime rate changes (such rate not necessarily
being the lowest or best rate charged by the Liquidity Provider (or NationsBank,
as applicable)) and (ii) sum of (a) 1.50% and (b) the rate equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day that is a Business Day, the average of the quotations for such day
for such transactions received by the Liquidity Provider (or, if more than one
Liquidity Provider, then by NationsBank) from three Federal funds brokers of
recognized standing selected by it.
"Benefit Plan" means any employee benefit plan as defined in
Section 3(3) of ERISA in respect of which the Transferor or any ERISA Affiliate
of the Transferor, is or at any time during the immediately preceding six years
was, an "employer" as defined in Section 3(5) of ERISA.
"Business Day" means any day excluding Satur- day, Sunday and
any day on which banks in ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇, California or Clearwater, Florida are authorized or required by law to
close, and, when used with respect to the determination of any Eurodollar Rate
or any notice with respect thereto, any such day which is also a day for trading
by and between banks in United States dollar deposits in the London interbank
market.
"BR Tranche" means a Tranche as to which Discount is
calculated at the Base Rate.
"BR Tranche Period" means, with respect to a BR Tranche,
either (i) prior to the Termination Date, a period of up to 30 days requested by
the Transferor and agreed to by the Company, NationsBank on behalf of the
Liquidity Provider, or the Agent, as the case may be, commencing on a Business
Day requested by the Transferor
0104420.05-01S7a
5
and agreed to by the Company, NationsBank or the Agent, as the case may be, or
(ii) after the Termination Date, a period of one day. If such BR Tranche Period
would end on a day which is not a Business Day, such BR Tranche Period shall end
on the next succeeding Business Day.
"Capitalized Lease" of a Person means any lease of property by
such Person as lessee which would be capitalized on a balance sheet of such
Person prepared in accordance with generally accepted accounting principles.
"CD Rate" shall mean, with respect to any CD Tranche Period, a
rate which is the Applicable Margin in excess of a rate per annum equal to the
sum (rounded upward to the nearest 1/100 of 1%) of (A) the rate obtained by
dividing (x) the Certificate of Deposit Rate for such CD Tranche Period by (y) a
percentage equal to 100% minus the stated maximum rate for all reserve
requirements as specified in Regulation D (including without limitation any
marginal, emergency, supplemental, special or other reserves) that would be
applicable during such Tranche Period to a negotiable certificate of deposit in
excess of $100,000, with a maturity approximately equal to such Tranche Period,
of any member bank of the Federal Reserve System plus (B) the then daily net
annual assessment rate (rounded upward, if necessary, to the nearest 1/100 of
1%) as estimated by the Agent for determining the current annual assessment
payable by the Agent to the Federal Deposit Insurance Corporation for insuring
such certificates of deposit.
"CD Tranche" means a Tranche as to which Discount is
calculated at the CD Rate.
"CD Tranche Period" means, with respect to a CD Tranche,
either (i) prior to the Termination Date, a period of up to one month requested
by the Transferor and agreed to by the Company, NationsBank on behalf of the
Liquidity Provider, or the Agent, as the case may be, commencing on a Business
Day requested by the Transferor and agreed to by the Company, NationsBank or the
Agent, as the case may be, or (ii) after the Termination Date, a period of one
day. If such CD Tranche Period would end on a day which is not a Business Day,
such CD Tranche Period shall end on the next succeeding Business Day.
0104420.05-01S7a
6
"Certificate" means the certificate issued to
the Agent for the benefit of the Company and the Bank
Investors pursuant to Section 2.2(d) hereof.
"Certificate of Deposit Rate" means, with respect to any CD
Tranche Period, the average of the bid rates determined by the Agent to be bid
rates per annum, at approximately 10:00 a.m. (New York City time) on the
Business Day before the first day of the CD Tranche Period for which such CD
Rate is to be applicable, of two or more New York certificate of deposit dealers
of recognized standing selected by the Agent for the purchase in New York from
the Agent at face value of certificates of deposit of the Agent in an aggregate
amount approximately comparable to the amount of the CD Tranche to which such CD
Rate is to be applicable and with a maturity approximately equal to the
applicable CD Tranche Period.
"Closing Date" means January 21, 1997
"Collateral Agent" means NationsBank N.A., as collateral agent
for any Liquidity Provider, any Credit Support Provider, the holders of
Commercial Paper and certain other parties.
"Collections" means, with respect to any Receivable, all cash
collections and other cash proceeds of such Receivable, including, without
limitation, all Finance Charges, if any, and cash proceeds of Related Security
with respect to such Receivable and any Deemed Collections of such Receivable.
"Collection Account" means the account, established by the
Agent, for the benefit of the Company and the Bank Investors, pursuant to
Section 2.12.
"Collection Agent" means at any time the Person then
authorized pursuant to Section 6.1 to service, administer and collect
Receivables.
"Collection Agent Account" means the account, established by
the Collection Agent, for the benefit of the Company and the Bank Investors,
pursuant to Section 2.8(b).
"Collection Delay" means 30 days.
0104420.05-01S7a
7
"Commercial Paper" means the promissory notes of the Company
issued by the Company in the commercial paper market.
"Commitment" means (i) with respect to each Bank Investor
party hereto, the commitment of such Bank Investor to make acquisitions from the
Transferor or the Company in accordance herewith in an amount not to exceed the
dollar amount set forth opposite such Bank Investor's signature on the signature
page hereto under the heading "Commitment", minus the dollar amount of any
Commitment or portion thereof assigned pursuant to an Assignment and Assumption
Agreement plus the dollar amount of any increase to such Bank Investor's
Commitment consented to by such Bank Investor prior to the time of
determination, (ii) with respect to any assignee of a Bank Investor party hereto
taking pursuant to an Assignment and Assumption Agreement, the commitment of
such assignee to make acquisitions from the Transferor or the Company not to
exceed the amount set forth in such Assignment and Assumption Agreement minus
the dollar amount of any Commitment or portion thereof assigned pursuant to an
Assignment and Assumption Agreement prior to such time of determination and
(iii) with respect to any assignee of an assignee referred to in clause (ii),
the commitment of such assignee to make acquisitions from the Transferor or the
Company not to exceed the amount set forth in an Assignment and Assumption
Agreement between such assignee and its assign.
"Commitment Termination Date" means December 31, 1997, or such
later date to which the Commitment Termination Date may be extended by
Transferor, the Agent and the Bank Investors not later than 60 days prior to the
then current Commitment Termination Date.
"Company" means Enterprise Funding Corporation,
and its successors and assigns.
"Concentration Factor" means for any Designated Obligor (a) 2%
of the Outstanding Balance of all Eligible Receivables; provided however, that
for up to three (3) Designated Obligors at any one time, 2.5% of the Outstanding
Balance of all Eligible Receivables at such time; provided further, however,
that with respect to any Designated Obligor and its affiliates whose long term
unsecured debt obligations are rated at ▇▇▇▇▇ "▇▇" by
0104420.05-01S7a
8
Moody's and at least "A+" by Standard & Poor's and with respect to which rating
neither Moody's nor Standard & Poor's shall have made a public announcement
anticipating a downgrading of such Designated Obligor's long term unsecured debt
obligations to a rating less than the aforementioned ratings ("A1/A+ Rated
Obligors") 5% of the Outstanding Balance of all Eligible Receivables at such
time, or (b) such other greater amount determined by the Agent in the reasonable
exercise of its good faith judgment and disclosed in a written notice delivered
to the Transferor.
"Consolidated Fixed Charge Ratio" has the
meaning specified in Exhibit N hereto.
"Consolidated Tangible Net Worth" has the
meaning specified in Exhibit N hereto.
"Consolidated Total Liabilities" has the mean-
ing specified in Exhibit N hereto.
"Contract" means an agreement or invoice in substantially the
form of one of the forms set forth in Exhibit A attached hereto or otherwise
approved by the Company, pursuant to or under which an Obligor shall be
obligated to pay for merchandise purchased or services rendered.
"CP Rate" means, with respect to any CP Tranche Period, the
rate equivalent to the rate (or if more than one rate, the weighted average of
the rates) at which Commercial Paper having a term equal to such CP Tranche
Period may be sold by any placement agent or commercial paper dealer selected by
the Company, provided, however, that if the rate (or rates) as agreed between
any such agent or dealer and the Company is a discount rate, then the rate (or
if more than one rate, the weighted average of the rates) resulting from the
Company's converting such discount rate (or rates) to an interest-bearing
equivalent rate per annum.
"CP Tranche" means a Tranche as to which Discount is
calculated at a CP Rate.
"CP Tranche Period" means, with respect to a CP Tranche, a
period of days not to exceed 90 days commencing on a Business Day requested by
the Transferor and
0104420.05-01S7a
9
agreed to by the Company pursuant to Section 2.3. If a CP Tranche Period would
end on a day which is not a Business Day, such CP Tranche Period shall end on
the next succeeding Business Day.
"Credit and Collection Policy" shall mean Tech Data's and the
Transferor's credit and collection policy or policies and practices, relating to
Contracts and Receivables existing on the date hereof and referred to in Exhibit
B attached hereto, as modified from time to time in compliance with Section
5.2(c).
"Credit Support Agreement" means the agreement between the
Company and the Credit Support Provider evidencing the obligation of the Credit
Support Provider to provide credit support to the Company in connection with the
issuance by the Company of Commercial Paper.
"Credit Support Provider" means the Person or Persons who
provides credit support to the Company in connection with the issuance by the
Company of Commercial Paper.
"Current Receivable" means any Receivable with respect to
which no payment is outstanding beyond the date on which such payment was due.
"Dealer Fee" means the fee payable by the Transferor to the
Agent, pursuant to Section 2.4 hereof, the terms of which are set forth in the
Fee Letter.
"Deemed Collections" means any Collections on any Receivable
deemed to have been received pursuant to Section 2.9(a) or (b) hereof.
"Defaulted Receivable" means a Receivable: (i)
as to which any payment, or part thereof, remains unpaid for 91 days or more
from the original due date for such Receivable; (ii) as to which an Event of
Bankruptcy has occurred with respect to the Obligor thereof; (iii) which has
been identified by the Collection Agent as uncollect- ible; or (iv) which,
consistent with the Credit and Col- lection Policy, should be written off the
Transferor's books as uncollectible.
"Delinquency Ratio" means, the ratio (expressed
as a percentage) computed as of the last day of each
0104420.05-01S7a
10
calendar month by dividing (i) the aggregate Outstanding Balance of all
outstanding Receivables as to which on the date of determination, any payment or
part thereof, remains unpaid for more than 30 days from the original due date
for such Receivable and which is not a Defaulted Receivable, by (ii) the
aggregate Outstanding Balance of all Receivables as of such date less Defaulted
Receivables as of such date.
"Delinquent Receivable" means a Receivable:
(i) as to which any payment, or part thereof, remains
unpaid for more than 60 days from the original due date
for such Receivable and (ii) which is not a Defaulted
Receivable.
"Designated Obligor" means, at any time, each Obligor;
provided, however, that any Obligor shall cease to be a Designated Obligor upon
notice from the Agent to the Transferor and the Collection Agent, delivered at
any time in good faith and based upon reasonable criteria.
"Dilution Ratio" means, the ratio (expressed as a percentage)
computed as of the last day of each calendar month by dividing (i) the aggregate
amount of credits, rebates, discounts, disputes, warranty claims, repossessed or
returned goods, charge back allowances and other dilutive factors, and any other
billing or other adjustment by the Transferor or the Collection Agent, provided
to Obligors in respect of Receivables during the preceding three months
(including such month) by (ii) the aggregate Outstanding Balance of all
Receivables which arose during the three month period commencing with the first
day of the fourth preceding month and ending with the last day of the second
preceding month.
"Dilution Reserve" means, at any time, an amount equal to the
product of (i) the highest Dilution Ratio as of the preceding six (6) months and
(ii) the Net Investment at such time.
"Discount" means, with respect to any Tranche
Period:
(TR x TNI x AD)
360
Where:
0104420.05-01S7a
11
TR = the Tranche Rate applicable to such Tranche Period.
TNI = the portion of the Net Investment allocated to such Tranche
Period.
AD = the actual number of days during such Tranche Period.
provided, however, that no provision of this Agreement shall require the payment
or permit the collection of Discount in excess of the maximum amount permitted
by applicable law; and provided, further, that Discount shall not be considered
paid by any distribution if at any time such distribution is rescinded or must
be returned for any reason.
"Discount Reserve" means, at any time, an
amount equal to:
TD + LY
Where:
TD = the sum of the unpaid Discount for all Tranche
Periods.
LY = the Liquidation Yield
"Early Collection Fee" means, for any Tranche Period (such
Tranche Period to be determined without regard to the last sentence in Section
2.3(a) hereof) during which the portion of the Net Investment that was allocated
to such Tranche Period is reduced for any reason whatsoever, the excess, if any,
of (i) the additional Discount that would have accrued during such Tranche
Period if such reductions had not occurred, minus (ii) the income, if any,
received by the recipients of such reductions from investing the proceeds of
such reductions.
"Eligible Investments" means any of the following: (a)
negotiable instruments or securities represented by instruments in bearer or
registered or in book-entry form which evidence (i) obligations fully guaranteed
by the United States of America; (ii) time deposits in, or bankers acceptances
issued by, any depositary institution
0104420.05-01S7a
12
or trust company incorporated under the laws of the United States of America or
any state thereof and subject to supervision and examination by Federal or state
banking or depositary institution authorities; provided, however, that at the
time of investment or contractual commitment to invest therein, the certificates
of deposit or short-term deposits, if any, or long-term unsecured debt
obligations (other than such obligation whose rating is based on collateral or
on the credit of a Person other than such institution or trust company) of such
deposi- tary institution or trust company shall have a credit rating from
Moody's and S&P of at least "P-1" and "A-1", respectively, in the case of the
certificates of deposit or short-term deposits, or a rating not lower than one
of the two highest investment categories granted by Moody's and by S&P; (iii)
certificates of deposit having, at the time of investment or contractual
commitment to invest therein, a rating from Moody's and S&P of at least "P-1"
and "A-1", respectively; or (iv) investments in money market funds rated in the
highest investment category or otherwise approved in writing by the applicable
rating agencies, (b) demand deposits in any depositary institution or trust
company referred to in (a)(ii) above; (c) commercial paper (having original or
remaining maturities of no more than 30 days) having, at the time of investment
or contractual commitment to invest therein, a credit rating from Moody's and
S&P of at least "P-1" and "A-1", respectively; (d) Eurodollar time deposits
having a credit rating from Moody's and S&P of at least "P-1" and "A-1",
respectively; and (e) repurchase agreements involving any of the Eligible
Investments described in clauses (a)(i), (a)(iii) and (d) hereof so long as the
other party to the repurchase agreement has at the time of investment therein, a
rating from Moody's and S&P of at least "P-1" and "A-1", respectively.
"Eligible Receivable" means, at any time, any
Receivable:
(i) which has been transferred
by Tech Data to the Transferor and to which the
Transferor has good title thereto, free and
clear of all Adverse Claims;
(ii) the Obligor of which is a
United States resident, is a Designated Obligor
0104420.05-01S7a
13
at the time of the initial creation of an in-
terest therein hereunder, is not an Affiliate
of any of the parties hereto, and is not a
government or a governmental subdivision or agency;
(iii) which is not a Defaulted
Receivable at the time of the initial creation
of an interest therein hereunder;
(iv) which is not a Delinquent
Receivable at the time of the initial creation
of an interest of the Company therein;
(v) which, (A) arises pursuant
to a Contract with respect to which each of the
Seller and the Transferor has performed all
obligations required to be performed by it
thereunder, including without limitation ship-
ment of the merchandise and/or the performance
of the services purchased thereunder; (B) has
been billed; and (C) according to the Contract
related thereto, is required to be paid in full
within 60 days of the original billing date
therefor;
(vi) which is an "eligible as-
set" as defined in Rule 3a-7 under the Invest-
ment Company Act of 1940, as amended;
(vii) a purchase of which with
the proceeds of Commercial Paper would consti-
tute a "current transaction" within the meaning
of Section 3(a)(3) of the Securities Act of
1933, as amended;
(viii) which is an "account" with-
in the meaning of Article 9 of the UCC of all
applicable jurisdictions;
(ix) which is denominated and
payable only in United States dollars in the
United States;
(x) which, arises under a Con-
tract that together with the Receivable related
thereto, is in full force and effect and con-
0104420.05-01S7a
14
stitutes the legal, valid and binding obliga-
tion of the related Obligor enforceable against
such Obligor in accordance with its terms and,
to the best knowledge of the Collection Agent
or the Transferor is not subject to any litiga-
tion, dispute, offset, counterclaim or other
defense at such time;
(xi) which, together with the
Contract related thereto, does not contravene
in any material respect any laws, rules or
regulations applicable thereto (including,
without limitation, laws, rules and regulations
relating to truth in lending, fair credit ▇▇▇▇-
ing, fair credit reporting, equal credit oppor-
tunity, fair debt collection practices and
privacy) and with respect to which no part of
the Contract related thereto is in violation
of any such law, rule or regulation in any material respect;
(xii) which (A) satisfies, in all
material respects, all applicable requirements
of the applicable Credit and Collection Policy
and (B) is assignable;
(xiii) which was generated in the
ordinary course of Tech Data's business; and
(xiv) the Obligor of which has
been directed to make all payments to a speci-
fied account of the Collection Agent with re-
spect to which there shall be a Lock-Box Agreement in effect.
"ERISA" means the U.S. Employee Retirement Income Security Act
of 1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA Affiliate" means, with respect to any Person, (i) any
corporation which is a member of the same controlled group of corporations
(within the meaning of Section 414(b) of the Code (as in effect from time to
time, the "Code")) as such Person; (ii) a trade or business (whether or not
incorporated) under common control (within the meaning of Section 414(c) of the
Code) with
0104420.05-01S7a
15
such Person; or (iii) a member of the same affiliated service group (within the
meaning of Section 414(n) of the Code) as such Person, any corporation described
in clause (i) above or any trade or business described in clause (ii) above.
"Estimated Maturity Period" means, at any time, the period,
rounded upward to the nearest whole number of days, equal to the weighted
average number of days until due of the Receivables as calculated by the
Collection Agent in good faith and set forth in the most recent Investor Report,
such calculation to be based on the assumptions that (a) each Receivable within
a particular aging category, (as set forth in the Investor Report) will be paid
on the last day of such aging category and (b) the last day of the last such
aging category coincides with the last date on which any Outstanding Balance of
any Receivables would be written off as uncollectible or charged against any
applicable reserve or similar account in accordance with the objective
requirements of the Credit and Collection Policy and the Transferor's normal
accounting practices applied on a basis consistent with those reflected in the
Transferor's financial statements, provided, however, that if the Agent, the
Company or any of the Bank Investors shall reasonably disagree with any such
calculation, the Agent may recalculate the Estimated Maturity Period on the
basis of such calculation at such time, and such recalculation, in the absence
of manifest error, shall be conclusive.
"Eurodollar Rate" means, with respect to any Eurodollar
Tranche Period, a rate which is the Applicable Margin in excess of a rate per
annum equal to the sum (rounded upwards, if necessary, to the next higher 1/100
of 1%) of (A) the rate obtained by dividing (i) the applicable LIBOR Rate by
(ii) a percentage equal to 100% minus the reserve percentage used for
determining the maximum reserve requirement as specified in Regulation D
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves) that is applicable to the Agent during such Eurodollar
Tranche Period in respect of eurocurrency or eurodollar funding, lending or
liabilities (or, if more than one percentage shall be so applicable, the daily
average of such percentage for those days in such Eurodollar Tranche Period
during which any such percentage shall be applicable) plus (B) the then daily
net annual assessment rate (rounded upwards,
0104420.05-01S7a
16
if necessary, to the nearest 1/100 of 1%) as estimated by the Agent for
determining the current annual assessment payable by the Agent to the Federal
Deposit Insurance Corporation in respect of eurocurrency or eurodollar funding,
lending or liabilities.
"Eurodollar Tranche" means a Tranche as to
which Discount is calculated at the Eurodollar Rate.
"Eurodollar Tranche Period" means, with respect to a
Eurodollar Tranche, prior to the Termination Date, a period of up to one month
requested by the Transferor and agreed to by the Company, NationsBank, on behalf
of the Liquidity Provider, or the Agent, as the case may be, commencing on a
Business Day requested by the Transferor and agreed to by the Company,
NationsBank or the Agent, as applicable; provided, however, that if such
Eurodollar Tranche Period would expire on a day which is not a Business Day,
such Eurodollar Tranche Period shall expire on the next succeeding Business Day;
provided, further, that if such Eurodollar Tranche Period would expire on (a) a
day which is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Eurodollar Tranche Period shall expire
on the next preceding Business Day or (b) a Business Day for which there is no
numerically corresponding day in the applicable subsequent calendar month, such
Eurodollar Tranche Period shall expire on the last Business Day of such month.
"Event of Bankruptcy", means, with respect to any Person, (i)
that such Person (a) shall generally not pay its debts as such debts become due
or (b) shall admit in writing its inability to pay its debts generally or (c)
shall make a general assignment for the benefit of creditors; (ii) any
proceeding shall be instituted by or against such Person seeking to adjudicate
it as bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any substantial part of
its property or (iii) if such Person is a corporation, such Person or any
Subsidiary shall take any corporate action to autho-
0104420.05-01S7a
17
rize any of the actions set forth in the preceding claus-
es (i) or (ii).
"Facility Limit" means $306,000,000 provided that such amount
may not at any time exceed the aggregate Commitments at any time in effect.
"Fee Letter" means the letter agreement dated the date hereof
between the Transferor, the Agent and the Company with respect to the fees to be
paid by the Trans- feror hereunder, as amended, modified or supplemented from
time to time.
"Finance Charges" means, with respect to a Contract, any
finance, interest, late or similar charges owing by an Obligor pursuant to such
Contract.
"Guaranty" means the agreement of guarantee of
the Guarantor set forth in Article IX hereof.
"Incremental Transfer" means a Transfer which is made pursuant
to Section 2.2(a) hereof.
"Indebtedness" means, with respect to any Person, such
Person's (i) obligations for borrowed money, (ii) obligations representing the
deferred purchase price of property other than accounts payable arising in the
ordinary course of such Person's business on terms customary in the trade, (iii)
obligations, whether or not assumed, secured by liens or payable out of the
proceeds or production from property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) Capitalized Lease obligations and (vi) obligations for which
such Person is obligated pursuant to a Guaranty.
"Indemnified Amounts" has the meaning specified
in Section 8.1 hereof.
"Indemnified Parties" has the meaning specified
in Section 8.1 hereof.
"Interest Component" shall mean, (i) with respect to any
Commercial Paper issued on an interest-bearing basis, the interest payable on
such Commercial Paper at its maturity (including any dealer commissions)
0104420.05-01S7a
18
and (ii) with respect to any Commercial Paper issued on a discount basis, the
portion of the face amount of such Commercial Paper representing the discount
incurred in respect thereof (including any dealer commissions).
"Investor Report" means a report, in substantially the form
attached hereto as Exhibit E or in such other form as is mutually agreed to by
the Transferor and the Agent, furnished by the Collection Agent pursuant to
Section 2.11.
"Law" means any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or
award of any Official Body.
"LIBOR Rate" means, with respect to any Euro- dollar Tranche
Period, the rate at which deposits in dollars are offered to the Agent in the
London interbank market at approximately 11:00 a.m. (London time) two Business
Days before the first day of such Eurodollar Tranche Period in an amount
approximately equal to the Eurodollar Tranche to which the Eurodollar Rate is to
apply and for a period of time approximately equal to the applicable Eurodollar
Tranche Period.
"Liquidation Yield" means, at any time, an
amount equal to:
(RVF x LBR x NI) x (EM + CD)
---------
360
Where:
RVF = the Rate Variance Factor;
LBR = the Base Rate which is applicable to the liqui-
dation period of the Net Investment at such
time;
NI = the Net Investment;
EM = the Estimated Maturity Period of the Receiv-
▇▇▇▇▇; and
CD = the Collection Delay.
0104420.05-01S7a
19
"Liquidity Provider" means the Person or Persons who will
provide liquidity support to the Company in connection with the issuance by the
Company of Commercial Paper.
"Liquidity Provider Agreement" means the agreement between the
Company and the Liquidity Provider evidencing the obligation of the Liquidity
Provider to provide liquidity support to the Company in connection with the
issuance by the Company of Commercial Paper.
"Lock-Box Account" means an account maintained by the
Collection Agent at a Lock-Box Bank for the purpose of receiving Collections
from Receivables.
"Lock-Box Agreement" means an agreement between the Collection
Agent and a Lock-Box Bank in substantially the form of Exhibit D hereto.
"Lock-Box Bank" means each of the banks set forth in Exhibit C
hereto and such banks as may be added thereto or deleted therefrom pursuant to
Section 2.8 hereof.
"Loss Percentage" means on any day the greater (i) 5 times the
highest Loss-to-Liquidation Ratio as of the last day of the 12 months preceding
the then current month, or (ii) 10 percent.
"Loss Reserve" means, on any day, an amount
equal to:
LP x (NI + DLR + DR + SFR)
Where:
LP = the Loss Percentage at the close of business of
the Collection Agent on such day;
NI = the Net Investment at the close of business of
the Collection Agent on such day;
DLR = the Dilution Reserve at the close of business
of the Collection Agent on such day;
DR = the Discount Reserve at the close of business
of the Collection Agent on such day; and
0104420.05-01S7a
20
SFR = the Servicing Fee Reserve at the close of business of the
Collection Agent on such day.
Notwithstanding the foregoing, the Loss Reserve shall at all times be at least
equal to $25,000,000.
"Loss-to-Liquidation Ratio" means, for any period of
determination, the ratio (expressed as a percentage) computed as of the last day
of each calendar month by dividing (i) the aggregate Outstanding Balance of all
Receivables which became Defaulted Receivables during such period, by (ii) the
aggregate amount of Collections received by the Collection Agent during such
period less Deemed Collections for the period.
"Majority Investors" shall have the meaning
specified in Section 10.1(a) hereof.
"Maximum Net Investment" means $300,000,000.
"Maximum Percentage Factor" means 98%.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA which is or was at any time during the current
year or the immediately preceding five years contributed to by the Trans- feror,
or any ERISA Affiliate of the Transferor on behalf of its employees.
"Net Asset Test" means, in connection with any assignment by
the Company to the Bank Investors of an interest in the Net Investment pursuant
to Section 10.7 hereof, that on the day immediately prior to the day on which
such assignment is to take effect, the Net Receivables Balance shall be equal to
or greater than the Net Investment.
"Net Investment" means the sum of the cash amounts paid to the
Transferor for each Incremental Transfer less the aggregate amount of
Collections received and applied by the Agent to reduce such Net Investment
pursuant to Section 2.5, 2.6 or 2.9 hereof; provided that the Net Investment
shall be restored and reinstated in the amount of any Collections so received
and applied if at any time the distribution of such
0104420.05-01S7a
21
Collections is rescinded or must otherwise be returned for any reason; and
provided further that the Net Investment may be increased by the amount
described in Section 10.7(d) as described therein.
"Net Receivables Balance" means at any time the Outstanding
Balance of the Eligible Receivables at such time reduced by the sum of (i) the
aggregate amount by which the Outstanding Balance of all Eligible Receivables of
each Designated Obligor exceeds the Concentration Factor for such Designated
Obligor, plus (ii) the aggregate Outstanding Balance of all Eligible Receivables
which are Defaulted Receivables, plus (iii) the aggregate Outstanding Balance of
all Eligible Receivables which are Delinquent Receivables.
"Obligations" shall have the meaning specified
in Section 9.1.
"Obligor" means a Person obligated to make payments for the
provision of goods and services pursuant to a Contract.
"Official Body" means any government or political subdivision
or any agency, authority, bureau, central bank, commission, department or
instrumentality of any such government or political subdivision, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
"Other Transferor" means any Person other than the Transferor
that has entered into a receivables purchase agreement or transfer and
administration agreement with the Company.
"Outstanding Balance" means, with respect to any Receivable at
any time, the then outstanding principal amount thereof including any accrued
and outstanding Finance Charges related thereto.
"Percentage Factor" shall mean the fraction (expressed as a
percentage) computed at any time of determination as follows:
NI + LR + DLR + DR + SFR
------------------------
NRB
Where:
0104420.05-01S7a
22
NI = the Net Investment at the time of such computa-
tion;
LR = the Loss Reserve at the time of such computa-
tion;
DLR = the Dilution Reserve at the time of such compu-
tation;
DR = the Discount Reserve at the time of such compu-
tation;
SFR = the Servicing Fee Reserve at the time of such
computation; and
NRB = the Net Receivables Balance at the time of such
computation as reduced by the amount of all
Deemed Collections.
Notwithstanding the foregoing computation, the Percentage
Factor shall not exceed one hundred percent (100%). The Percentage Factor shall
be calculated by the Collection Agent on the day of the initial Incremental
Transfer hereunder. Thereafter, until the Termination Date, the Collection Agent
shall daily recompute the Percentage Factor and report such recomputations to
the Agent monthly in the Investor Report or as reasonably otherwise requested by
the Agent. The Percentage Factor shall remain constant from the time as of which
any such computation or recomputation is made until the time as of which the
next such recomputation shall be made, notwithstanding any additional
Receivables arising, any Incremental Transfer made pursuant to Section 2.2(a) or
any reinvestment Transfer made pursuant to Section 2.2(b) and 2.5 during any
period between computations of the Percentage Factor. The Percentage Factor, as
calculated at the close of business on the Business Day immediately preceding
the Termination Date, shall remain constant at all times thereafter until such
time as the Agent shall have received the Aggregate Unpaids, in cash, at which
time the Percentage Factor shall be recomputed in accordance with Section 2.6.
"Person" means any corporation, limited liabil-
ity company, natural person, firm, joint venture, part-
0104420.05-01S7a
23
nership, trust, unincorporated organization, enterprise,
government or any department or agency of any government.
"Potential Termination Event" means an event which but for the
lapse of time or the giving of notice, or both, would constitute a Termination
Event.
"Pro Rata Share" means, for a Bank Investor, the Commitment of
such Bank Investor divided by the sum of the Commitments of all Bank Investors.
"Proceeds" means "proceeds" as defined in
Section 9.306(1) of the UCC.
"Program Fee" means the fee payable by the Transferor to the
Company pursuant to Section 2.7 hereof, the terms of which are set forth in the
Fee Letter.
"Purchase Agreement" means the Receivables Purchase Agreement
dated as of December 21, 1993, between Tech Data and the Transferor, as the same
may be amended, supplemented or otherwise modified.
"Purchase Termination Date" means the date upon which the
Transferor shall cease, for any reason whatsoever, to make purchases of
Receivables from Tech Data under the Purchase Agreement or the Purchase
Agreement shall terminate for any reason whatsoever.
"Purchased Interest" means the interest in the Receivables
acquired by the Liquidity Provider through purchase pursuant to the terms of the
Liquidity Provider Agreement.
"Rate Variance Factor" means the number, computed from time to
time in good faith by the Agent, that reflects the largest potential variance
(from minimum to maximum) in selected interest rates over a period of time
selected by the Agent from time to time, set forth in a written notice by the
Agent to the Transferor and the Collection Agent.
"Receivable" means the indebtedness owed to the Transferor by
any Obligor (without giving effect to any purchase hereunder by the Company at
any time) under a Contract whether constituting an account, chattel paper,
instrument or general intangible, arising in connection
0104420.05-01S7a
24
with the sale of merchandise or services by Tech Data and thereafter transferred
to the Transferor by Tech Data, and includes the right to payment of any Finance
Charges and other obligations of such Obligor with respect thereto.
Notwithstanding the foregoing, once a Receivable has been deemed collected
pursuant to Section 2.9 hereof, it shall no longer constitute a Receivable
hereunder.
"Records" means all Contracts and other documents, books,
records and other information (including, without limitation, computer programs,
tapes, discs, punch cards, data processing software and related property and
rights) maintained with respect to Receivables and the related Obligors.
"Reinvestment Termination Date" means the second Business Day
after the delivery by the Company to the Transferor of written notice that the
Company elects to commence the amortization of its interest in the Net
Investment or otherwise liquidate its interest in the Transferred Interest.
"Related Commercial Paper" shall mean Commercial Paper issued
by the Company the proceeds of which were used to acquire, or refinance the
acquisition of, an interest in Receivables with respect to the Transferor.
"Related Security" means with respect to any Receivable, all
of the Transferor's rights, title and interest in, to and under:
(i) all of the Transferor's interest, if any, in the
merchandise (including returned or repossessed merchandise), if any,
the sale of which by the Transferor gave rise to such Receivable;
(ii) all other security interests or liens and
property subject thereto from time to time, if any, purporting to
secure payment of such Receivable, whether pursuant to the Contract
related to such Receivable or otherwise, together with all financing
statements signed by an Obligor describing any collateral securing such
Receivable;
0104420.05-01S7a
25
(iii) all guarantees, indemnities, warranties,
insurance (and proceeds and premium refunds thereof) or other
agreements or arrangements of any kind from time to time supporting or
securing payment of such Receivable whether pursuant to the Contract
related to such Receivable or otherwise;
(iv) all Records related to such
Receivable; and
(v) all rights and remedies of the Transferor under
the Receivables Purchase Agreement, together with all financing
statements filed by the Transferor against the Seller in connection
therewith; and
(vi) all Proceeds of any of the
foregoing.
"Section 8.2 Costs" has the meaning specified
in Section 8.2(d) hereof.
"Seller" means Tech Data Corporation, a Florida
corporation.
"Servicing Fee" means the fees payable by the Company or the
Bank Investors to the Collection Agent, with respect to a Tranche, in an amount
equal to .75% per annum on the amount of the Net Investment allocated to such
Tranche pursuant to Section 2.3. Such fee shall accrue from the date of the
initial purchase of an interest in the Receivables to the later of the
Termination Date or the date on which the Net Investment is reduced to zero. On
or prior to the Termination Date, such fee shall be payable only from
Collections pursuant to, and subject to the priority of payments set forth in,
Section 2.5 hereof. After the Termination Date, such fee shall be payable only
from Collections pursuant to, and subject to the priority of payments set forth
in, Section 2.6 hereof.
"Servicing Fee Reserve" means at any time the sum of (i) the
Servicing Fee for all Tranches and (ii) an amount equal to the product of (A)
the Net Investment at such time, and (B) the Servicing Fee percentage and (C) a
fraction having as the numerator, the sum of the Estimat-
0104420.05-01S7a
26
ed Maturity Period and the Collection Delay and as the
denominator, 360.
"Standard & Poor's" or "S&P" means Standard & Poor's Ratings
Services, a division of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Subsidiary" of a Person means any corporation more than 50%
of the outstanding voting interests of which shall at any time be owned or
controlled, directly or indirectly, by such Person or by one or more
Subsidiaries of such Person or any similar business organization which is so
owned or controlled.
"Termination Date" means the earliest of (i) that Business Day
designated by the Transferor to the Agent as the Termination Date at any time
following 60 days' written notice to the Agent, (ii) the date of termination of
the commitment of the Liquidity Provider under the Liquidity Provider Agreement,
(iii) the date of termination of the commitment of the Credit Support Provider
under the Credit Support Agreement, (iv) the day upon which a Termination Date
is declared or automatically occurs pursuant to Section 7.2(a) hereof, (v)
December 31, 1997 unless extended for any additional period by consent of Tech
Data, the Company, the Transferor and the Agent upon notice given by the Company
to Tech Data and the Transferor at least 60 days prior to such date, (vi) two
Business Days prior to the Commitment Termination Date, (vi) the day on which a
Reinvestment Termination Date shall occur, or (vii) the Purchase Termination
Date.
"Termination Event" means an event described in
Section 7.1 hereof.
"Tranche" means a portion of the Net Investment allocated to a
Tranche Period pursuant to Section 2.3 hereof.
"Tranche Period" means a CP Tranche Period, a
BR Tranche Period, a CD Tranche Period or a Eurodollar
Tranche Period.
"Tranche Rate" means the CP Rate, the Base Rate, the CD Rate
or the Eurodollar Rate.
0104420.05-01S7a
27
"Transaction Documents" means, collectively, this Agreement,
the Purchase Agreement, the Fee Letter, the Lock-Box Agreements, the
Certificates, the Transfer Certificates and all of the other instruments,
documents and other agreements executed and delivered by Tech Data or the
Transferor in connection with any of the foregoing, in each case, as the same
may be amended, restated, supplemented or otherwise modified from time to time.
"Transfer" means a conveyance, transfer and assignment by the
Transferor to the Company or the Bank Investors of an undivided percentage
ownership interest in Receivables hereunder (including, without limitation, as a
result of any reinvestment of Collections in Transferred Interests pursuant to
Section 2.2(b) and 2.5 hereof).
"Transfer Certificate" has the meaning speci-
fied in Section 2.2(a) hereof.
"Transfer Date" means, with respect to each Transfer, the
Business Day on which such Transfer is made.
"Transfer Price" means with respect to any Incremental
Transfer, the amount paid to the Transferor by the Company or the Bank Investors
as described in the applicable Transfer Certificate.
"Transferor" means Tech Data Finance, Inc., a California
corporation, and its successors and permitted assigns.
"Transferred Interest" means, at any time of determination, an
undivided percentage ownership interest in (i) each and every then outstanding
Receivable, (ii) all Related Security with respect to each such Receivable,
(iii) all Collections with respect thereto, and (iv) other Proceeds of the
foregoing, which undivided ownership interest shall be equal to the Percentage
Factor at such time, and only at such time (without regard to prior
calculations). The Transferred Interest in each Receivable, together with
Related Security, Collections and Proceeds with respect thereto, shall at all
times be equal to the Transferred Interest in each other Receivable, together
with Related Security, Collections and Proceeds with respect thereto. To the
extent that
0104420.05-01S7a
28
the Transferred Interest shall decrease as a result of a recalculation of the
Percentage Factor, the Company or the Bank Investors, as applicable, shall be
considered to have reconveyed to the Transferor an undivided percentage
ownership interest in each Receivable, together with Related Security,
Collections and Proceeds with respect thereto, in an amount equal to such
decrease such that in each case the Transferred Interest in each Receivable
shall be equal to the Transferred Interest in each other Receivable.
"UCC" means, with respect to any state, the Uniform Commercial
Code as from time to time in effect in such state.
"Unpaid Balance" means, at any time, with respect to any
Receivable, the outstanding principal amount of the indebtedness of the related
Obligor incurred in connection with a particular purchase under or evidenced by
such Receivable, exclusive of any sales or other tax, if any, included in or
payable with respect to such purchase.
"Unused Facility Fee" means the fee payable by the Transferor
to the Company pursuant to Section 2.7 hereof, the terms of which are set forth
in the Fee Letter.
SECTION 1.2. Other Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles. All terms used in Article 9 of the UCC in the
State of New York, and not specifically defined herein, are used herein as
defined in such Article 9.
SECTION 1.3. Computation of Time Periods. Unless otherwise
stated in this Agreement, in the computation of a period of time from a
specified date to a later specified date, the word "from" means "from and
including", the words "to" and "until" each means "to but excluding" and the
word "within" means "from and excluding a specified date and to and including a
later specified date".
0104420.05-01S7a
29
ARTICLE II
PURCHASES AND SETTLEMENTS
SECTION 2.1. Facility. Upon the terms and subject to the
conditions herein set forth, (x) the Transferor may, at its option, convey,
transfer and assign to the Agent, on behalf of the Company or the Agent, on
behalf of the Bank Investors, as applicable, and (y) the Agent, on behalf of the
Company may, provided that the Termination Date shall not have occurred, at its
option, or the Agent on behalf of the Bank Investors, provided that the
Termination Date shall not have occurred and that the Bank Investors shall have
previously accepted the assignment by the Company of all of its interest in the
Affected Assets, shall, if so requested, accept such conveyance, transfer and
assignment from the Transferor of, without recourse except as provided herein,
undivided percentage ownership interests in the Receivables, together with
Related Security, Collections and Proceeds with respect thereto, from time to
time. By accepting any conveyance, transfer and assignment hereunder, neither
the Company, any Bank Investor nor the Agent assumes or shall have any
obligations or liability under any of the Contracts, all of which shall remain
the obligations and liabilities of the Transferor and the Seller.
SECTION 2.2. Transfers; Certificates; Eligible
Receivables. (a) Incremental Transfers. Upon the terms and subject to the
conditions herein set forth the Trans- feror may, at its option, convey,
transfer and assign to the Agent on behalf of the Company or the Bank Investors,
as applicable, and the Agent, on behalf of the Company may, provided that the
Termination Date shall not have occurred, at its option, or the Agent on behalf
of the Bank Investors, provided that the Termination Date shall not have
occurred and that the Bank Investors shall have previously accepted the
assignment by the Company of all of its interest in the Affected Assets, shall,
if so re- quested by the Transferor, accept such conveyance, trans- fer and
assignment from the Transferor, without recourse except as provided herein,
undivided percentage ownership interests in the Receivables, together with
Related Security, Collections and Proceeds with respect thereto (each, an
"Incremental Transfer"); provided that after
0104420.05-01S7a
30
giving effect to the payment to the Transferor of such Transfer Price (x) the
sum of the Net Investment plus, in the case where the Transferred Interest is
held by the Company, the Interest Component of all outstanding Related
Commercial Paper, would not exceed the Facility Limit and (y) the Net Investment
would not exceed the Maximum Net Investment; and, provided further, that the
representations and warranties set forth in Section 3.1 shall be true and
correct both immediately before and immediately after giving effect to any such
Incremental Transfer and the payment to the Transferor of the Transfer Price
related thereto and an Investor Report shall have been delivered with respect to
such Incremental Transfer as required by Section 3.2 hereof.
The Transferor shall, by notice to the Agent given by
telecopy, offer to convey, transfer and assign to the Agent, on behalf of the
Company or the Bank Investors, as applicable, undivided percentage ownership
interests in the Receivables and the other Affected Assets relating thereto at
least three (3) Business Days prior to the proposed date of any Incremental
Transfer. Each such notice shall specify (w) whether such request is made to the
Agent on behalf of the Company or to the Agent on behalf of the Bank Investors
(it being understood and agreed that once the Bank Investors acquire any
Transferred Interest hereunder, the Bank Investors shall be required to purchase
all Transferred Interests held by the Company in accordance with Section 10.7
and thereafter the Company shall no longer accept any additional Incremental
Transfers hereunder), (x) the desired Transfer Price (which shall be at least
$5,000,000 or integral multiples of $1,000,000 in excess thereof) or, to the
extent that the then available unused portion of the Facility Limit is less than
such amount, such lesser amount equal to such available portion of the Facility
Limit), (y) the desired date of such Incremental Transfer and (z) the desired
Tranche Period(s) and allocations of the Net Investment of such Incremental
Transfer thereto as required by Section 2.3. The Agent will promptly notify the
Company or each of the Bank Investors, as the case may be, of the Agent's
receipt of any request for an Incremental Transfer to be made to such Person. To
the extent that any such Incremental Transfer is requested of the Company, the
Company shall accept or reject such offer by notice given to the Transferor and
the Agent by telephone or telecopy by no later than the close of its
0104420.05-01S7a
31
business on the Business Day following its receipt of any such request. Each
notice of proposed Transfer shall be irrevocable and binding on the Transferor
and the Trans- feror shall indemnify the Company and each Bank Investor against
any loss or expense incurred by the Company or any Bank Investor, either
directly or through the Liquidity Provider Agreement) as a result of any failure
by the Transferor to complete such Incremental Transfer including, without
limitation, any loss (including loss of anticipated profits) or expense incurred
by the Company or any Bank Investor, either directly or pursuant to the
Liquidity Provider Agreement by reason of the liquidation or reemployment of
funds acquired by the Company (or the Liquidity Provider) or any Bank Investor
(including, without limitation, funds obtained by issuing commercial paper or
promissory notes or obtaining deposits as loans from third parties) for the
Company or any Bank Investor to fund such Incremental Transfer.
On the date of the initial Incremental Transfer, the Agent, on
behalf of the Company or the Bank Investors, as applicable, shall deliver
written confirmation to the Transferor of the Transfer Price, the Tranche
Period(s) and the Tranche Rate(s) relating to such Transfer and the Transferor
shall deliver to the Agent the Transfer Certificate in the form of Exhibit F
hereto (the "Transfer Certificate"). The Agent shall indicate the amount of the
initial Incremental Transfer together with the date thereof on the grid attached
to the Transfer Certificate. On the date of each subsequent Incremental
Transfer, the Agent shall send written confirmation to the Transferor of the
Transfer Price, the Tranche Period(s), the Transfer Date and the Tranche Rate(s)
applicable to such Incremental Transfer. The Agent shall indicate the amount of
the Incremental Transfer together with the date thereof as well as any decrease
in the Net Investment on the grid attached to the Transfer Certificate. The
Transfer Certificate shall evidence the Incremental Transfers. Following each
Incremental Transfer, the Agent shall deposit to the Transferor's account at the
location indicated in Section 11.3 hereof, in immediately available funds, an
amount equal to the Transfer Price for such Incremental Transfer made to the
Company or the Bank Investors, as applicable.
By no later than 11:00 a.m. (New York time) on
any Transfer Date, the Company or each Bank Investor, as
▇▇▇▇▇▇▇.05-01S7a
32
the case may be, shall remit its share (which, in the case of an Incremental
Transfer to the Bank Investors, shall be equal to such Bank Investor's Pro Rata
Share) of the aggregate Transfer Price for such Transfer to the account of the
Agent specified therefor from time to time by the Agent by notice to such
Persons. The obligation of each Bank Investor to remit its Pro Rata Share of any
such Transfer Price shall be several from that of each other Bank Investor, and
the failure of any Bank Investor to so make such amount available to the Agent
shall not relieve any other Bank Investor of its obligation hereunder. Following
each Incremental Transfer and the Agent's receipt of funds from the Company or
the Bank Investors as aforesaid, the Agent shall remit the Transfer Price to the
Transferor's account at the location indicated in Section 11.3 hereof, in
immediately available funds, an amount equal to the Transfer Price for such
Incremental Transfer. Unless the Agent shall have received notice from the
Company or any Bank Investor, as applicable, that such Person will not make its
share of any Transfer Price relating to any Incremental Transfer available on
the applicable Transfer Date therefor, the Agent may (but shall have no
obligation to) make the Company's or any such Bank Investor's share of any such
Transfer Price available to the Transferor in anticipation of the receipt by the
Agent of such amount from the Company or such Bank Investor. To the extent the
Company or any such Bank Investor fails to remit any such amount to the Agent
after any such advance by the Agent on such Transfer Date, the Company or such
Bank Investor, on the one hand, and the Transferor, on the other hand, shall be
required to pay such amount, together with interest thereon at a per annum rate
equal to the Federal funds rate (as determined in accordance with clause (ii) of
the definition of "Base Rate"), in the case of the Company or any such Bank
Investor, or the Base Rate, in the case of the Transferor, to the Agent upon its
demand therefor (provided that the Company shall have no obligation to pay such
interest amounts except to the extent that it shall have sufficient funds to pay
the face amount of its Commercial Paper in full). Until such amount shall be
repaid, such amount shall be deemed to be Net Investment paid by the Agent and
the Agent shall be deemed to be the owner of a Transferred Interest hereunder.
Upon the payment of such amount to the Agent (x) by the Transfer- or, the amount
of the aggregate Net Investment shall be reduced by such amount or (y) by the
Company or such Bank
▇▇▇▇▇▇▇.05-01S7a
33
Investor, such payment shall constitute such Person's payment of its share of
the applicable Transfer Price for such Transfer.
(b) Reinvestment Transfers. On each
Business Day occurring after the initial Incremental Transfer hereunder and
prior to the Termination Date, the Transferor hereby agrees to convey, transfer
and assign to the Agent, on behalf of the Company or the Bank Investors then
owning any Transferred Interests, and in consideration of Transferor's agreement
to maintain at all times prior to the Termination Date a Net Receivables Balance
in an amount at least sufficient to maintain the Percentage Factor at an amount
not greater than the Maximum Percentage Factor, the Agent on behalf of the
Company may, and the Agent on behalf of the Bank Investors shall (in either
case, to the extent such Persons then own any Transferred Interest), agrees to
purchase from the Transferor undivided percentage ownership interests in each
and every Receivable, together with Related Security, Collections and Proceeds
with respect thereto, to the extent that Collections are available for such
Transfer in accordance with Section 2.5 hereof, such that after giving effect to
such Transfer, (i) the amount of the Net Investment at the close of business on
such Business Day shall be equal to the amount of the Company's Net Investment
at the close of the business on the Business Day immediately preceding such
Business Day plus the Transfer Price of any Incremental Transfer made on such
day, if any, and (ii) the Transferred Interest in each Receivable, together with
Related Security, Collections and Proceeds with respect thereto, shall be equal
to the Transferred Interest in each other Receivable, together with Related
Security, Collections and Proceeds with respect thereto.
(c) All Transfers. Each Transfer shall
constitute a purchase by the Agent on behalf of the Company or the Bank
Investors, as applicable, of undivided percentage ownership interests in each
and every Receivable, together with Related Security, Collections and Proceeds
with respect thereto, then existing, as well as in each and every Receivable,
together with Related Security, Collections and Proceeds with respect thereto,
which arises at any time after the date of such Transfer. The Agent's aggregate
undivided percentage ownership interest in the Receivables, together with the
Related
0104420.05-01S7a
34
Security, Collections and Proceeds with respect thereto, held on behalf of the
Company or the Bank Investors, as applicable, shall equal the Percentage Factor
in effect from time to time. So long as the Agent on behalf of either the
Company, on the one hand, or the Bank Investors, on the other hand, owns all of
the Transferred Interests at such time, each of the Company's and each Bank
Investor's undivided percentage ownership interest in the Affected Assets shall
equal such Person's ratable share (determined on the basis of the relationship
that such Person's Net Investment bears to the aggregate Net Investment of the
Company and all of the Bank Investors at such time) of the Percentage Factor at
such time.
(d) Certificate. The Transferor shall
issue to the Agent the Certificate, in the form of Exhib-
it M, on or prior to the date hereof.
(e) Percentage Factor. The Percentage
Factor shall be initially computed as of the opening of business of the
Collection Agent on the date of the initial Incremental Transfer hereunder.
Thereafter until the Termination Date, the Percentage Factor shall be
automatically recomputed as of the close of business of the Collection Agent on
each day (other than a day after the Termination Date). The Percentage Factor
shall remain constant from the time as of which any such computation or
recomputation is made until the time as of which the next such recomputation, if
any, shall be made. The Percentage Factor, as computed as of the day immediately
preceding the Termination Date shall remain constant at all times on and after
the Termination Date until the date on which the Net Investment has been reduced
to zero, and all accrued Discount and Servicing Fees have been paid in full and
all other Aggregate Unpaids have been paid in full.
SECTION 2.3. Selection of Tranche Periods and
Tranche Rates.
(a) At all times hereafter, but prior to
the occurrence of a Termination Event and not with respect to any portion of the
transferred Interest held by the Bank Investors (or any of them), the Transferor
may, subject to the Company's approval and the limitations described below,
request Tranche Periods and allocate a portion of the Net Investment to each
selected Tranche
0104420.05-01S7a
35
Period, so that the aggregate amounts allocated to outstanding Tranche Periods
at all times shall equal the Net Investment held by the Company. The Transferor
shall give the Company irrevocable notice by telephone of the new requested
Tranche Period(s) and whether the requested Tranche Rate applicable thereto
shall be the CP Rate, the BR Rate, the CD Rate or the Eurodollar Rate at least
(i) three (3) Business Days prior to the expiration of any then existing Tranche
Period if the Tranche Rate to be applicable to the new requested Tranche Period
shall be the Eurodollar Rate, (ii) two (2) Business Days prior to the expiration
of any then existing Tranche Period if the Tranche Rate to be applicable to the
new requested Tranche Period shall be the BR Rate or the CD Rate, and (iii) one
(1) Business Day prior to the expiration of any then existing Tranche Period if
the Tranche Rate to be applicable to the new requested Tranche Period shall be
the CP Rate; provided, however, that the Company may select, in its reasonable
discretion, any such new Tranche Period and Tranche Rate if (i) the Transferor
fails to provide such notice on a timely basis or (ii) the Company determines,
in its reasonable discretion, that the Tranche Rate or Tranche Period requested
by the Transferor is unavailable or for any reason commercially undesirable. The
Company confirms that it is its intention to allocate all or substantially all
of the Net Investment held by it to one or more CP Tranche Periods; provided
that the Company may determine from time to time, in its sole discretion, that
funding such Net Investment by means of one or more CP Tranche Periods is not
desirable for any reason. If the Liquidity Provider acquires from the Company a
Purchased Interest with respect to the Receivables pursuant to the terms of the
Liquidity Provider Agreement, NationsBank, on behalf of the Liquidity Provider,
may exercise the right of selection granted to the Company hereby. The initial
Tranche Period applicable to any such Purchased Interest shall be a period of
not greater than 14 days. In the case of any Tranche Period outstanding upon the
occurrence of a Termination Event, such Tranche Period shall end on such date.
(b) After a Termination Event; Trans-
ferred Interest Held by Company. At all times on and after the occurrence of a
Termination Event, with respect to any portion of the Transferred Interest which
shall not have been transferred to the Bank Investors (or any
▇▇▇▇▇▇▇.05-01S7a
36
of them), the Company or NationsBank, as applicable, shall select all Tranche
Periods and Tranche Rates applicable thereto.
(c) Prior to a Termination Event; Trans-
ferred Interest Held by Bank Investor. At all times with respect to any portion
of the Transferred Interest transferred to the Bank Investors (or any of them)
pursuant to Section 10.7, but prior to the occurrence of a Termination Event,
the initial Tranche Period applicable to such portion of the Net Investment
allocable thereto shall be a period of not greater than 14 days and such Tranche
shall be a BR Tranche. Thereafter, with respect to such portion, and with
respect to any other portion of the Transferred Interest held by the Bank
Investors (or any of them), provided that a Termination Event shall not have
occurred, the Tranche Period applicable thereto shall be, at the Transferor's
option, either a BR Tranche, a CD Tranche or a Eurodollar Tranche. The
Transferor shall give the Agent irrevocable notice by telephone of the new
requested Tranche Period at least three (3) Business Days prior to the
expiration of any then existing Tranche Period. In the case of any Tranche
Period outstanding upon the occurrence of a Termination Event, such Tranche
Period shall end on the date of such occurrence.
(d) After a Termination Event; Trans-
ferred Interest Held by Bank Investor. At all times on and after the occurrence
of a Termination Event, with respect to any portion of the Transferred Interest
which shall have been owned or transferred to the Bank Investors (or any of
them), the Agent shall select all Tranche Periods and Tranche Rates applicable
thereto.
(e) Eurodollar Rate Protection; Illegali-
ty. (i) If the Agent is unable to obtain on a timely basis the information
necessary to determine the LIBOR Rate for any proposed Eurodollar Tranche, then
(A) the Agent shall forthwith notify the Company or Bank
Investors, as applicable and the Transferor that the Eurodollar Rate
cannot be determined for such Eurodollar Tranche, and
(B) while such circumstances exist, neither
the Company, the Bank Investors or the Agent shall
0104420.05-01S7a
37
allocate the Net Investment of any additional Transferred Interests
purchased during such period or reallocate the Net Investment allocated
to any then existing Tranche ending during such period, to a Eurodollar
Tranche.
(ii) If, with respect to any outstanding Eurodollar Tranche,
the Company or any of the Bank Investors owning any Transferred Interest therein
notifies the Agent that it is unable to obtain matching deposits in the London
interbank market to fund its purchase or maintenance of such Transferred
Interest or that the Eurodol- lar Rate applicable to such Transferred Interest
will not adequately reflect the cost to the Person of funding or maintaining its
respective Transferred Interest for such Tranche Period then the Agent shall
forthwith so notify the Transferor, whereupon neither the Agent nor the Company
or the Bank Investors, as applicable, shall, while such circumstances exist,
allocate any Net Investment of any additional Transferred Interest purchased
during such period or reallocate the Net Interest allocated to any Tranche
Period ending during such period, to a Eurodollar Tranche.
(iii) Notwithstanding any other provision of this Agreement,
if the Company or any of the Bank Investors, as applicable, shall notify the
Agent that such Person has determined (or has been notified by any Liquidity
Provider) that the introduction of or any change in or in the interpretation of
any law or regulation makes it unlawful (either for the Company, such Bank
Investor, or such Liquidity Provider, as applicable), or any central bank or
other governmental authority asserts that it is unlawful, for the Company, such
Bank Investor or such Liquidity Provider, as applicable, to fund the purchases
or maintenance of Transferred Interests at the Eurodollar Rate, then (x) as of
the effective date of such notice from such Person to the Agent, the obligation
or ability of the Company or such Bank Investor, as applicable, to fund its
purchase or maintenance of Transferred Interests at the Eurodollar Rate shall be
suspended until such Person notifies the Agent that the circumstances causing
such suspension no longer exist and (y) the Net Investment of each Eurodollar
Tranche in which such Person owns an interest shall either (1) if such Person
may lawfully continue to maintain such Transferred Interest at the Eurodollar
Rate until the last day of the
0104420.05-01S7a
38
applicable Tranche Period, be reallocated on the last day of such Tranche Period
to another Tranche Period in respect of which the Net Investment allocated
thereto accrues Discount at a Tranche Rate other than the Euro- dollar Rate or
(2) if such Person shall determine that it may not lawfully continue to maintain
such Transferred Interest at the Eurodollar Rate until the end of the applicable
Tranche Period, such Person's share of the Net Investment allocated to such
Eurodollar Tranche shall be deemed to accrue Discount at the Base Rate from the
effective date of such notice until the end of such Tranche Period.
SECTION 2.4. Discount, Fees and Other Costs and Expenses.
Notwithstanding the limitation on recourse under Section 2.1 hereof, the
Transferor shall pay, as and when due in accordance with this Agreement, all
fees hereunder, all amounts payable pursuant to Article VIII hereof, if any, and
the Servicing Fees. On the last day of each Tranche Period, the Transferor shall
pay to the Agent, on behalf of the Company, in the event the Transferred
Interest is held by the Company, an amount equal to the discount accrued on the
Company's Commercial Paper to the extent such Commercial Paper was issued in
order to fund the Transferred Interest in an amount in excess of the Transfer
Price of an Incremental Transfer, which excess amount shall not exceed $5,000.
The Transferor shall pay to the Agent, on behalf of the Company, each day on
which Commercial Paper is issued by the Company, the Dealer Fee. Discount shall
accrue with respect to each Tranche on each day occurring during the Tranche
Period related thereto. Nothing in this Agreement shall limit in any way the
obligations of the Transferor to pay the amounts set forth in this Section 2.4.
SECTION 2.5. Non-Liquidation Settlement and Reinvestment
Procedures. On each day after the date of any Incremental Transfer but prior to
the Termination Date and provided that no Potential Termination Event for which
there is no grace period shall have occurred and be continuing, the Collection
Agent shall out of the Percentage Factor of Collections received on or prior to
such day and not previously applied or accounted for: (i) set aside and hold in
trust for the Company or the Bank Investors, as applicable (or deposit into the
Collection Account if so required pursuant to Section 2.12 hereof) an amount
equal to all Discount and the Servicing
0104420.05-01S7a
39
Fee accrued through such day and not so previously set aside or paid and (ii)
apply the balance of such Percentage Factor of Collections remaining after
application of Collections as provided in clause (i) of this Section 2.5 to the
Transferor, for the benefit of the Company or the Bank Investors, as applicable,
to the purchase of additional undivided percentage interests in each Receivable
pursuant to Section 2.2(b) hereof. On the last day of each Tranche Period, from
the amounts set aside as described in clause (i) of the first sentence of this
Section 2.5, the Collection Agent shall deposit to the Agent's account, for the
benefit of the Company or the Bank Investors, as applicable, an amount equal to
the accrued and unpaid Discount for such Tranche Period and shall deposit to its
own account an amount equal to the accrued and unpaid Servicing Fee for such
Tranche Period. The Agent, upon its receipt of such amounts in the Agent's
account, shall distribute such amounts to the Company and/or the Bank Investors
entitled thereto as set forth above; provided that if the Agent shall have
insufficient funds to pay all of the above amounts in full on any such date, the
Agent shall pay such amounts ratably (based on the amounts owing to each such
Person) to all such Persons entitled to payment thereof. In addition, the
Collection Agent shall remit to the Transferor at the end of each Tranche
Period, as provided in Section 6.2(b), such portion of Collections not allocated
to the Company and the Bank Investors.
SECTION 2.6. Liquidation Settlement Procedures. If at any time
on or prior to the Termination Date, the Percentage Factor is greater than the
Maximum Percentage Factor, then the Transferor shall immediately pay to the
Agent, for the benefit of the Company or the Bank Investors, as applicable, from
previously received Collections, an amount equal to the amount such that, when
applied in reduction of the Net Investment, will result in a Percentage Factor
less than or equal to the Maximum Percentage Factor. Such amount shall be
applied to the reduction of the Net Investment of Tranche Periods selected by
the Agent. On the Termination Date and on each day thereafter, and on each day
on which a Potential Termination Event has occurred and is continuing, the
Collection Agent shall set aside and hold in trust for the Company or the Bank
Investors, as applicable (or deposit into the Collection Account if so required
pursuant to Section 2.12 hereof) the Percentage Factor of all
0104420.05-01S7a
40
Collections received on such day and shall set aside and hold in trust for the
Transferor such portion of Collections not allocated to the Company or the Bank
Investors, as applicable. On the Termination Date or the day on which a
Potential Termination Event for which there is no grace period occurs, the
Collection Agent shall deposit to the Agent's account, for the benefit of the
Company or the Bank Investors, as applicable, any amounts set aside pursuant to
Section 2.5 above. On the last day of each Tranche Period to occur on or after
the Termination Date or during the continuance of a Potential Termination Event,
the Collection Agent shall deposit to the Agent's account to the extent not
already so deposited, for the benefit of the Company or the Bank Investors, as
applicable, the amounts so set aside for the Company or the Bank Investors
pursuant to the second preceding sentence, but not to exceed the sum of (i) the
accrued Discount for such Tranche Period, (ii) the portion of the Net Investment
allocated to such Tranche Period, and (iii) all other Aggregate Unpaids. On such
day, the Collection Agent shall deposit to its account, from the amounts set
aside for the Company and the Bank Investors pursuant to the preceding sentence
which remain after payment in full of the aforementioned amounts, the accrued
Servicing Fee for such Tranche Period. If there shall be insufficient funds on
deposit for the Collection Agent to distribute funds in payment in full of the
aforementioned amounts, the Collection Agent shall distribute funds first, in
payment of the accrued Discount, second, in payment of all fees payable by the
Transferor, third, if the Trans- feror, Tech Data or any Affiliate of the
Transferor or Tech Data is not then the Collection Agent, to the Collection
Agent's account, in payment of the Servicing Fee payable to the Collection
Agent, fourth, in reduction of the Net Investment allocated to any Tranche
Period ending on such date, fifth, in payment of all other Aggregate Unpaids and
sixth, if the Transferor, Tech Data or any Affiliate of the Transferor or Tech
Data is the Collection Agent, to its account as Collection Agent, in payment of
the Servicing Fee payable to such Person as Collection Agent. The Agent, upon
its receipt of such amounts in the Agent's account, shall distribute such
amounts to the Company and/or the Bank Investors entitled thereto as set forth
above; provided that if the Agent shall have insufficient funds to pay all of
the above amounts in full on any such date, the Agent shall pay such amounts in
the order of priority set forth above
0104420.05-01S7a
41
and, with respect to any such category above for which the Agent shall have
insufficient funds to pay all amounts owing on such date, ratably (based on the
amounts in such categories owing to such Persons) among all such Persons
entitled to payment thereof.
Following the date on which the Net Investment has been
reduced to zero, all accrued Discount and Servicing Fees have been paid in full
and all other Aggregate Unpaids have been paid in full, (i) the Collection Agent
shall recompute the Percentage Factor, (ii) the Agent, on behalf of the Company
and the Bank Investors, shall be considered to have reconveyed to the Transferor
all of the Company's and the Bank Investors' right, title and interest in and to
the Affected Assets (including the Transferred Interest), (iii) the Collection
Agent shall pay to the Transferor any remaining Collections set aside and held
by the Collection Agent pursuant to the third sentence of this Section 2.6 and
(iv) the Agent, on behalf of the Company and the Bank Investors, shall execute
and deliver to the Transferor, at the Transferor's expense, such documents or
instruments as are necessary to terminate the Company's and the Bank Investors'
respective interests in the Affected Assets. Any such documents shall be
prepared by or on behalf of the Trans- feror. On the last day of each Tranche
Period, the Collection Agent shall remit to the Transferor such portion of
Collections set aside for the Transferor pursuant to this Section 2.6.
SECTION 2.7. Fees. Notwithstanding any limitation on recourse
contained in this Agreement, the Transferor shall pay, on the last day of each
month, to the Agent, for distribution to the Company and/or the Bank Investors,
as agreed between themselves, the Program Fee and the Unused Facility Fee. The
Transferor acknowledges that the foregoing fees are non-refundable.
SECTION 2.8. Protection of Ownership Interest of the Company
and the Bank Investors. (a) The Transferor agrees that it will, and will cause
the Seller to, from time to time, at its expense, it will promptly execute and
deliver all instruments and documents and take all actions as may be necessary
or as the Agent may reasonably request in order to perfect or protect the
Transferred Interest or to enable the Agent, the Company or the Bank Investors
to exercise or enforce any of their
0104420.05-01S7a
42
respective rights hereunder. Without limiting the foregoing, the Transferor
will, and will cause the Seller to, upon the reasonable request of the Agent,
the Company or any of the Bank Investors, in order to accurately reflect this
purchase and sale transaction, (x) execute and file such financing or
continuation statements or amendments thereto or assignments thereof (as
permitted pursuant to Section 11.6 hereof) as may be requested by the Agent, the
Company or any of the Bank Investors and (y) ▇▇▇▇ its and the Seller's
respective master data processing records and other documents with a legend
describing (i) in the case of the Seller, the conveyance to the Transferor and
(ii) in the case of the Transferor, the conveyance to the Agent, for the benefit
of the Company and the Bank Investors, of the Transferred Interest. The
Transferor shall, and will cause the Seller to, upon the reasonable request of
the Agent, the Company or any of the Bank Investors, obtain such additional
search reports as the Agent, the Company or any of the Bank Investors shall
request. To the fullest extent permitted by applicable law, the Agent shall be
permitted to sign and file continuation statements and amendments thereto and
assignments thereof without the Transferor's or the Seller's signature. Carbon,
photographic or other reproduction of this Agreement or any financing statement
shall be sufficient as a financing statement. The Transferor shall not, and
shall not permit the Seller to, change its respective name, identity or
corporate structure (within the meaning of Section 9-402(7) of the UCC as in
effect in the States of New York and California) nor relocate its respective
chief executive office or any office where Records are kept unless it shall
have: (i) given the Agent at least thirty (30) days prior notice thereof and
(ii) prepared at Transferor's expense and delivered to the Agent all financing
statements, instruments and other documents necessary to preserve and protect
the Transferred Interest or requested by the Agent in connection with such
change or relocation. Any filings under the UCC or otherwise that are occasioned
by such change in name or location shall be made at the expense of Trans- feror.
(b) The Collection Agent shall instruct
all Obligors to cause all Collections to be deposited directly with a Lock-Box
Bank. Any Lock-Box Account maintained by a Lock-Box Bank pursuant to the related
Lock-Box Agreement shall be under the exclusive ownership
0104420.05-01S7a
43
and control of the Agent which is hereby granted to the Agent by the Seller and
the Transferor. The Collection Agent shall be permitted to give instructions to
the Lock-Box Banks for so long as neither a Collection Agent default nor any
other Termination Event has occurred hereunder. The Collection Agent shall not
add any bank as a Lock-Box Bank to those listed on Exhibit C attached hereto
unless such bank has entered into a Lock-Box Agreement. The Collection Agent
shall not terminate any bank as a Lock-Box Bank unless the Agent shall have
received fifteen (15) days' prior notice of such termination. If the Transferor
receives any Collections or is deemed to receive any Collections pursuant to
Section 2.9, the Transferor shall immediately remit such Collections to a
Lock-Box Account. Any Collections that are received by the Seller or the
Collection Agent shall be immediately, but in any event within forty-eight (48)
hours of receipt, be deposited by into a Lock-Box Account or a bank account (the
"Collection Agent Account") established by the Collection Agent pursuant to an
agreement between the Collection Agent, the Agent and a bank consented to by the
Agent, which shall be substantially in the form of a Lock-Box Agreement.
SECTION 2.9. Deemed Collections; Application of Payments. (a)
If on any day the Outstanding Balance of a Receivable is either (x) reduced as a
result of any defective, rejected or returned merchandise or services, any
discount, credit, rebate, dispute, warranty claim, repossessed or returned
goods, chargeback, allowance, any billing adjustment, dilutive factor or other
adjustment, or (y) reduced or canceled as a result of a setoff or offset in
respect of any claim by any Person (whether such claim arises out of the same or
a related transaction or an unrelated transaction), the Transferor shall be
deemed to have received on such day a Collection of such Receivable in the
amount of such reduction or cancellation and the Transferor shall pay to the
Collection Agent an amount equal to such reduction or cancellation and such
amount shall be applied by the Collection Agent as a Collection in accordance
with Section 2.5 or 2.6 hereof, as applicable. The Net Investment shall be
reduced by the amount of such payment applied to the reduction of the Net
Investment and actually received by the Agent.
0104420.05-01S7a
44
(b) If on any day any of the representa-
tions or warranties in Article III was or becomes untrue with respect to a
Receivable (whether on or after the date of any transfer of an interest therein
to the Agent, the Company or the Bank Investors as contemplated hereunder), the
Transferor shall be deemed to have received on such day a Collection of such
Receivable in full and the Transferor shall on such day pay to the Collection
Agent an amount equal to the Outstanding Balance of such Receivable and such
amount shall be allocated and applied by the Collection Agent as a Collection
allocable to the Transferred Interest in accordance with Section 2.5 or 2.6
hereof, as applicable. The Net Investment shall be reduced by the amount of such
payment applied to the reduction of the Net Investment and actually received by
the Agent.
(c) Any payment by an Obligor in respect
of any indebtedness owed by it to the Transferor shall, except as otherwise
specified by such Obligor or otherwise required by contract or law and unless
otherwise instructed by the Company, be applied as a Collection of any
Receivable of such Obligor included in the Transferred Interest (starting with
the oldest such Receivable) to the extent of any amounts then due and payable
thereunder before being applied to any other receivable or other indebtedness of
such Obligor.
SECTION 2.10. Payments and Computations, Etc. All amounts to
be paid or deposited by the Transferor or the Collection Agent hereunder shall
be paid or deposited in accordance with the terms hereof no later than 11:00
a.m. (New York City time) on the day when due in immediately available funds; if
such amounts are payable to the Company or any Bank Investor they shall be paid
or deposited in the account indicated in Section 11.3 hereof, until otherwise
notified by the Agent. The Transferor shall, to the extent permitted by law, pay
to the Agent, for the benefit of the Company and the Bank Investors upon demand,
interest on all amounts not paid or deposited when due hereunder at a rate equal
to 1% per annum plus the Base Rate. All computations of Discount, interest and
all per annum fees 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. Any computations by the Agent of amounts payable by the
0104420.05-01S7a
45
Transferor hereunder shall be binding upon the Transferor absent manifest error.
SECTION 2.11. Reports. Prior to the 15th day of each month,
the Collection Agent shall prepare and forward to the Agent and the
Administrative Agent (i) an Investor Report (including without limitation, a
settlement statement and a certification as to the Net Receivables Balance)
together with an aging of all Receivables, as of the close of business of the
Collection Agent on the last day of the immediately preceding month, (ii) if
requested by the Company, a listing by Obligor of all Receivables together with
an aging of such Receivables and (iii) such other information as the Agent or
the Administrative Agent may reasonably request.
SECTION 2.12. Collection Account. There shall be established
on the day of the initial Incremental Transfer hereunder and maintained, for the
benefit of the Company and the Bank Investors, with the Agent, a segregated
account (the "Collection Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the Company and the
Bank Investors. On and after the occurrence of a Collection Agent default or a
Termination Event, the Collection Agent shall remit daily within forty-eight
hours of receipt to the Collection Account all Collections received with respect
to any Receivables. Funds on deposit in the Collection Account (other than
investment earnings) shall be invested by the Agent in Eligible Investments that
will mature so that such funds will be available prior to the last day of each
successive Tranche Period following such investment. On the last day of each
calendar month, all interest and earnings (net of losses and investment
expenses) on funds on deposit in the Collection Account shall be retained in the
Collection Account and be available to make any payments required to be made
hereunder (including Discount) to the Agent, the Company or the Bank Investors.
On the date on which the Net Investment is zero, all accrued Discount and
Servicing Fees have been paid in full and all other Aggregate Unpaids have been
paid in full, any funds remaining on deposit in the Collection Account shall be
paid to the Transferor.
SECTION 2.13. Sharing of Payments, Etc. If
the Company or any Bank Investor (for purposes of this
0104420.05-01S7a
46
Section only, being a "Recipient") shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of setoff, or otherwise) on
account of Transferred Interest owned by it (other than pursuant to Section 2.7,
or Article VIII and other than as a result of the differences in the timing of
the applications of Collections pursuant to Section 2.5 or 2.6) in excess of its
ratable share of payments on account of Transferred Interest obtained by the
Company and/or the Bank Investors entitled thereto, such Recipient shall
forthwith purchase from the Company and/or the Bank Investors entitled to a
share of such amount participations in the Percentage Interests owned by such
Persons as shall be necessary to cause such Recipient to share the excess
payment ratably with each such other Person entitled thereto; provided, however,
that if all or any portion of such excess payment is thereafter recovered from
such Recipient, such purchase from each such other Person shall be rescinded and
each such other Person shall repay to the Recipient the purchase price paid by
such Recipient for such participation to the extent of such recovery, together
with an amount equal to such other Person's ratable share (according to the
proportion of (a) the amount of such other Person's required payment to (b) the
total amount so recovered from the Recipient) of any interest or other amount
paid or payable by the Recipient in respect of the total amount so recovered.
SECTION 2.14. Rights of Set-off. Without in any way limiting
the provisions of Section 2.13, each of the Company and the Bank Investors is
hereby authorized (in addition to any other rights it may have) at any time
after the occurrence of the Termination Date or during the continuance of a
Potential Termination Event to set-off, appropriate and apply (without
presentment, demand, protest or other notice which are hereby expressly waived)
any deposits and any other indebtedness held or owing by the Company or such
Bank Investor to, or for the account of, the Transferor against the amount of
the Aggregate Unpaids owing by the Transferor to such Person (even if contingent
or unmatured).
0104420.05-01S7a
47
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the Transferor.
The Transferor represents and warrants to the Company, the Agent and the Bank
Investors that:
(a) Corporate Existence and Power. The
Transferor is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
corporate power and all material governmental licenses, authorizations, consents
and approvals required to carry on its business in each jurisdiction in which
its business is now conducted.
(b) Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the Transferor of this
Agreement, the Purchase Agreement, the Fee Letter, the Certificate and the
Transfer Certificate are within the Transferor's corporate powers, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, Official Body or official thereof (except as
contemplated by Section 2.8 hereof), and do not contravene, or constitute a
default under, any provision of applicable law or regulation or of the
Certificate of Incorporation or Bylaws of the Transferor or of any agreement,
judgment, injunction, order, decree or other instrument binding upon the
Transferor or result in the creation or imposition of any Adverse Claim on the
assets of the Transferor or any of its Subsidiaries (except as contemplated by
Section 2.8 hereof).
(c) Binding Effect. Each of this Agree-
ment, the Purchase Agreement, the Fee Letter and the Certificate constitutes and
the Transfer Certificate upon payment of the Transfer Price set forth therein
will constitute, the legal, valid and binding obligation of the Transferor,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, moratorium or other similar laws affecting the rights of
creditors generally.
0104420.05-01S7a
48
(d) Perfection. Immediately preceding
each Transfer hereunder, the Transferor shall be the owner of all of the
Receivables, free and clear of all Adverse Claims. On or prior to each Transfer
and each recomputation of the Transferred Interest, all financing statements and
other documents required to be recorded or filed in order to perfect and protect
the Transferred Interest against all creditors of and purchasers from the
Transferor and Tech Data will have been duly filed in each filing office
necessary for such purpose and all filing fees and taxes, if any, payable in
connection with such filings shall have been paid in full.
(e) Accuracy of Information. All infor-
mation heretofore furnished by the Transferor (including without limitation, the
Investor Report furnished on a monthly basis and the Transferor's financial
statements) to the Company, any Bank Investors, the Agent or the Administrative
Agent for purposes of or in connection with this Agreement or any transaction
contemplated hereby is, and all such information hereafter furnished by the
Transferor to the Company, any Bank Investors, the Agent or the Administrative
Agent will be, true and accurate in every material respect, on the date such
information is stated or certified.
(f) Tax Status. The Transferor has filed
all tax returns (federal, state and local) required to be filed and has paid or
made adequate provision for the payment of all taxes, assessments and other
governmental charges.
(g) Action, Suits. Except as set forth
in Exhibit H, there are no actions, suits or proceedings pending, or to the
knowledge of the Transferor threatened, against or affecting the Transferor or
any Affiliate of the Transferor or their respective properties, in or before any
court, arbitrator or other body, which may materially adversely affect the
financial condition of the Transferor and the Subsidiaries taken as a whole or
materially adversely affect the ability of Transferor to perform its obligations
under this Agreement.
(h) Use of Proceeds. No proceeds of any
Transfer will be used by the Transferor to acquire any security in any
transaction which is subject to Section 13 or 14 of the Securities Exchange Act
of 1934, as amended.
0104420.05-01S7a
49
(i) Place of Business. The principal
place of business and chief executive office of the Transferor are located at
the address of the Transferor indicated in Section 11.3 hereof and the offices
where the Transferor keeps all its Records, are located at the address(es)
described on Exhibit I or such other locations notified to the Agent in
accordance with Section 2.8 hereof in jurisdictions where all action required by
Section 2.8 hereof has been taken and completed.
(j) Good Title. Upon each Transfer and
each recomputation of the Transferred Interest, the Company shall acquire a
valid and perfected first priority undivided percentage ownership interest to
the extent of the Transferred Interest or a first priority perfected security
interest in each Receivable that exists on the date of such Transfer and
recomputation and in the Related Security and Collections with respect thereto
free and clear of any Adverse Claim.
(k) Tradenames, Etc. As of the date
hereof: (i) the Transferor's chief executive office is located at the address
for notices set forth in Section 11.3 hereof; (ii) the Transferor has only the
subsidiaries and divisions listed on Exhibit J hereto; and (iii) the Transferor
has, within the last five (5) years, operated only under the tradenames
identified in Exhibit J hereto, and, within the last five (5) years, has not
changed its name, merged with or into or consolidated with any other corporation
or been the subject of any proceeding under ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code
(Bankruptcy), except as disclosed in Exhibit J hereto.
(l) Nature of Receivables. Each Receiv-
able (x) represented by the Transferor or the Collection Agent to be an Eligible
Receivable (including in any Investor Report or other report delivered pursuant
to Section 2.11 hereof) or (y) included in the calculation of the Net
Receivables Balance in fact satisfies at such time the definition of "Eligible
Receivable" set forth herein and is an "eligible asset" as defined in Rule 3a-7
under the Investment Company Act, of 1940, as amended and, in the case of clause
(y) above, is not a Receivable of the type described in clauses (i) through
(iii) of the definition of "Net Receivables Balance."
0104420.05-01S7a
50
(m) Coverage Requirement; Amount of
Receivables. The Percentage Factor does not exceed the Maximum Percentage
Factor. As of December 31, 1996 the aggregate Outstanding Balance of the
Receivables in exis- tence was $503,847,551 and the Net Receivables Balance was
$456,871,841.
(n) No Termination Event. No event has
occurred and is continuing and no condition exists which constitutes a
Termination Event or a Potential Termination Event or if either such event has
occurred, the Transferor has notified the Company in writing of either such
event immediately upon learning of the occurrence thereof, describing the same
and if applicable, the steps being taken by the Person(s) affected with respect
thereto.
(o) Not an Investment Company. The
Transferor is not an "investment company" within the meaning of the Investment
Company Act of 1940, as amended, or is exempt from all provisions of such Act.
(p) ERISA. The Transferor and each of
its ERISA Affiliates is in compliance in all material respects with ERISA and no
ERISA lien exists on any of the Receivables.
(q) Lock-Box Accounts. The name and
address of the Bank where the Collection Agent Account is maintained, together
with the account number of such account, and the names and addresses of all the
Lock-Box Banks, together with the account numbers of the Lock-Box Accounts of
Tech Data at such Lock-Box Banks, are specified in Exhibit C hereto (or at such
other Lock-Box Banks and/or with such other Lock-Box Accounts as have been
notified to the Agent and for which Lock-Box Agreements have been executed in
accordance with Section 2.8(b) hereof and delivered to the Collection Agent).
All Obligors have been instructed to make payment to a Lock- Box Account and
only Collections are deposited into the Lock-Box Accounts.
Any document, instrument, certificate or notice delivered to
the Company hereunder shall be deemed a representation and warranty by the
Transferor.
0104420.05-01S7a
51
SECTION 3.2. Reaffirmation of Representations and Warranties
by the Transferor. On each day that a Transfer is made hereunder, the
Transferor, by accepting the proceeds of such Transfer, whether delivered to the
Transferor pursuant to Section 2.2(a) or Section 2.5 hereof, shall be deemed to
have certified that all representations and warranties described in Section 3.1
hereof are correct on and as of such day as though made on and as of such day.
Each Incremental Transfer shall be subject to the further condition precedent
that prior to the date of such Transfer, the Collection Agent shall have
delivered to the Agent and the Administrative Agent, in form and substance
satisfactory to the Agent and the Administrative Agent, a completed Investor
Report dated within 14 days prior to the date of such Transfer, together with a
listing by Obligor, if requested, and such additional information as may be
reasonably requested by the Agent or the Administrative Agent; and the
Transferor shall be deemed to have represented and warranted that such
conditions precedent have been satisfied.
SECTION 3.3. Representations and Warranties of Tech Data, as
Collection Agent and Guarantor. Tech Data, as Collection Agent and Guarantor
represents and warrants to the Company and the Bank Investors that:
(a) Corporate Existence and Power. Tech
Data is a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation and has all corporate power
and all material governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its business is
now conducted.
(b) Corporate and Governmental Autho-
rization; Contravention. The execution, delivery and performance by Tech Data of
this Agreement and the Purchase Agreement are within Tech Data's corporate
powers, have been duly authorized by all necessary corporate action, require no
action by or in respect of, or filing with, any Official Body or official
thereof (except for the filing of UCC financing statements in connection with
the Purchase Agreement), and do not contravene, or constitute a default under,
any provision of applicable law or regulation or of the Certificate of
Incorporation or Bylaws of Tech Data or of any agreement, judgment, injunction,
order, decree or other instrument binding upon
0104420.05-01S7a
52
Tech Data or result in the creation or imposition of any Adverse Claim on the
assets of Tech Data or any of Tech Data's Subsidiaries except as contemplated by
this Agreement and the Purchase Agreement.
(c) Binding Effect. Each of this Agree-
ment and the Purchase Agreement constitute the legal, valid and binding
obligation of Tech Data, enforceable in accordance with their respective terms,
subject to applicable bankruptcy, insolvency, moratorium or other similar laws
affecting the rights of creditors.
(d) Accuracy of Information. All infor-
mation heretofore furnished by Tech Data to the Transfer- or, the Agent, the
Company, any Bank Investor or the Administrative Agent for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by Tech Data to the Transferor, the
Agent, the Company, any Bank Investor or the Administrative Agent will be, true
and accurate in every material respect, on the date such information is stated
or certified.
(e) Tax Status. Tech Data has filed all
tax returns (federal, state and local) required to be filed and has paid or made
adequate provision for the payment of all taxes, assessments and other
governmental charges.
(f) Action, Suits. Except as set forth
in Exhibit H hereto, there are no actions, suits or proceedings pending, or to
the knowledge of Tech Data threatened, against or affecting Tech Data or any
Affiliate of Tech Data or their respective properties, in or before any court,
arbitrator or other body, which may materially adversely affect the financial
condition of Tech Data and Tech Data's Subsidiaries taken as a whole or
materially adversely affect the ability of Tech Data to perform its obligations
under this Agreement.
(g) Credit and Collection Policy. Since
Closing Date, there have been no material changes in Tech Data's Credit and
Collection Policy; since such date, no material adverse change has occurred in
the overall rate of collection of the Receivables.
0104420.05-01S7a
53
(h) Collections and Servicing. Since
December 31, 1996, there has been no material adverse change in the ability of
Tech Data to service and collect the Receivables.
(i) Place of Business. The principal
place of business and chief executive office of Tech Data are located at the
address of Tech Data indicated in Section 11.3 hereof and the offices where Tech
Data keeps all its Records, are located at the address(es) described on Exhibit
I or such other locations notified to the Company in accordance with Section 2.8
hereof in jurisdictions where all action required by Section 2.8 hereof has been
taken and completed.
(j) Tradenames, Etc. As of the date
hereof: (i) Tech Data's chief executive office is located at the address for
notices set forth in Section 11.3 hereof; (ii) Tech Data has only the
subsidiaries and divisions listed on Exhibit J hereto; and (iii) Tech Data has,
within the last five (5) years, operated only under the tradenames identified in
Exhibit J hereto, and, within the last five (5) years, has not changed its name,
merged with or into or consolidated with any other corporation or been the
subject of any proceeding under ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code (Bankruptcy),
except as disclosed in Exhibit J hereto.
(k) Nature of Receivables. Each Receiv-
able is an "eligible asset" as defined in Rule 3a-7 under the Investment Company
Act, of 1940, as amended.
(l) No Termination Event. No event has
occurred and is continuing and no condition exists which constitutes a
Termination Event or a Potential Termination Event or if either such event has
occurred, Tech Data has notified the Company in writing of either such event
immediately upon learning of the occurrence thereof, describing the same and if
applicable, the steps being taken by the Person(s) affected with respect
thereto.
(m) Not an Investment Company. Tech Data
is not an "investment company" within the meaning of the Investment Company Act
of 1940, as amended, or is exempt from all provisions of such Act.
0104420.05-01S7a
54
(n) ERISA. Tech Data is in compliance in
all material respects with ERISA and no lien exists in favor of the Pension
Benefit Guaranty Corporation on any of the Receivables.
SECTION 3.4. Reaffirmation of Representations and Warranties
by Tech Data, as Collection Agent and Guarantor. On each day that a Transfer is
made hereunder, Tech Data shall be deemed to have certified that all
representations and warranties described in Section 3.3 are correct on and as of
such day as though made on and as of such day.
Any document, instrument, certificate or notice delivered to
the Company hereunder shall be deemed a representation and warranty by Tech
Data.
0104420.05-01S7a
55
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1. Conditions to Closing. On or prior to the date of
execution hereof, the Transferor shall deliver to the Agent the following
documents, instruments and fees all of which shall be in a form and substance
acceptable to the Agent:
(a) A copy of the resolutions of the
Board of Directors of the Transferor and Tech Data certified by its Secretary
approving the execution, delivery and performance by the Transferor and Tech
Data of this Agreement, the Purchase Agreement and the other Transaction
Documents to be delivered by the Transferor and Tech Data hereunder or
thereunder.
(b) The Articles of Incorporation of the
Transferor and of Tech Data certified by the Secretary of State or other similar
official of the Transferor's and Tech Data's respective jurisdictions of
incorporation, each dated a date reasonably prior to the Closing Date.
(c) A Good Standing Certificate for the
Transferor and a Certificate of Status for Tech Data issued by the Secretary of
State or a similar official of the Transferor's and Tech Data's respective
jurisdictions of incorporation and certificates of qualification as a foreign
corporation issued by the Secretaries of State or other similar officials of
each jurisdiction where such qualification is material to the transactions
contemplated by this Agreement and the other Transaction Documents, in each
case, dated a date reasonably prior to the Closing Date.
(d) A Certificate of the Secretary of the
Transferor and Tech Data substantially in the form of Exhibit L attached hereto
certifying (i) the names and signatures of the officers authorized on its behalf
to execute this Agreement, the Purchase Agreement, the Certificate, the Fee
Letter and any other documents to be delivered by it hereunder (on which
Secretary's Certificates the Company may conclusively rely until such time as
the Company shall receive from the Transferor and Tech Data a revised
Certificate meeting the requirements of
0104420.05-01S7a
56
this clause (d)(i)) and (ii) a copy of the Transferor's
and Tech Data's By-Laws.
(e) Copies of proper financing statements
(Form UCC-1), dated a date reasonably near to the date of the initial
Incremental Transfer naming the Transferor as the debtor in favor of the Agent,
for the benefit of the Company and the Bank Investors, secured party or other
similar instruments or documents as may be necessary or in the reasonable
opinion of the Agent desirable under the UCC of all appropriate jurisdictions or
any comparable law to perfect the Agent's undivided percentage interest in all
Receivables and the Related Security and Collections relating thereto.
(f) Copies of proper financing statements
(Form UCC-1), dated a date reasonably near to the date of the initial
Incremental Transfer naming Tech Data as the debtor in favor of the Transferor
as secured party and the Agent, for the benefit of the Company and the Bank
Investors, as assignee of the secured party or other similar instruments or
documents as may be necessary or in the reasonable opinion of the Agent
desirable under the UCC of all appropriate jurisdictions or any comparable law
to perfect the Transferor's ownership interest in all Receivables.
(g) Copies of proper financing statements
(Form UCC-3), if any, necessary to terminate all security interests and other
rights of any person in Receivables previously granted by Tech Data and the
Transferor.
(h) Certified copies of request for
information or copies (Form UCC-11) (or a similar search report certified by
parties acceptable to the Agent) dated a date reasonably near the date of the
initial Incremental Transfer listing all effective financing statements which
name the Transferor or the Seller (under their respective present names and any
previous names) as debtor and which are filed in jurisdictions in which the
filings were made pursuant to items (e) or (f) above together with copies of
such financing statements (none of which shall cover any Receivables or
Contracts).
(i) Executed copies of the Lock-Box
Agreements, relating to each of the Lock-Boxes and the
0104420.05-01S7a
57
Lock-Box Accounts, and an executed copy of the agreement referred to in Section
2.8(b).
(j) An opinion of ▇▇▇▇▇ ▇▇▇▇▇▇, counsel
to Tech Data, addressing certain corporate matters relating to Tech Data,
covering the appropriate matters set forth in Exhibit K hereto.
(k) An opinion of Heller, Ehrman, White &
▇▇▇▇▇▇▇▇▇, special California counsel to the Transferor, addressing certain
corporate matters relating to the Transferor, covering the appropriate matters
set forth in Exhibit K hereto.
(l) A certificate of the Transferor and
Tech Data in the form of Exhibit L-1 and Exhibit L-2 hereto executed by ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇, Secretary of the Transferor and Tech Data, respectively.
(m) A hard copy, microfiche or computer
tape setting forth all Receivables and the Outstanding Balances thereon and such
other information as the Agent may reasonably request.
(n) An executed copy of this Agreement,
the Purchase Agreement, and the Fee Letter.
(o) The Transfer Certificate, duly exe-
cuted by the Transferor.
(p) The Certificate, duly executed by the
Transferor and appropriately completed.
(q) An Investor Report for December 31,
1996.
(r) An assignment by NationsBank, N.A.,
as collateral agent under the Company's commercial paper program, of its
interest in certain of the Lock-Box Agreements to the Agent.
(s) A letter agreement, dated the Closing
Date, between NationsBank, N.A. and the Transferor relat-
ing to certain legal opinion matters.
0104420.05-01S7a
58
(t) Such other documents, instruments,
certificates and opinions as the Agent or the Administra-
tive Agent, shall reasonably request.
SECTION 4.2. Post Closing Conditions. On or prior to February
3, 1997, the Transferor shall deliver to the Agent the following documents,
which shall be in a form and substance acceptable to the Agent:
(a) An opinion of Heller, Ehrman, White &
▇▇▇▇▇▇▇▇▇, special California counsel to the Transferor, addressing certain
security interest and Uniform Commercial Code matters relating to the Agent's
interest in the Receivables; and
(b) An original fully executed copy of a
Lock-Box Agreement relating to account number ▇▇▇▇▇▇▇▇▇▇ maintained at
NationsBank of Texas, N.A.
▇▇▇▇▇▇▇.05-01S7a
59
ARTICLE V
COVENANTS
SECTION 5.1. Affirmative Covenants of Trans- feror. At all
times from the date hereof to the later to occur of (i) the Termination Date or
(ii) the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless the Agent shall otherwise
consent in writing:
(a) Reports. The Transferor shall deliv-
er to the Agent, on behalf of the Company:
(i) Compliance Certificate. Within one hundred and
twenty (120) days of the close of each of its fiscal years and within
sixty (60) days of the close of each of the first three fiscal quarters
of each of its fiscal years, a compliance certificate signed by its
chief financial officer stating that no Termination Event or Potential
Termination Event exists, or if any Termination Event or Potential
Termination Event exists, stating the nature and status thereof.
(ii) Notice of Termination Events or Potential
Termination Events. As soon as possible and in any event within two
days after the occurrence of each Termination Event or each Potential
Termination Event, a statement of the chief financial officer or chief
accounting officer of the Transferor setting forth details of such
Termination Event or Potential Termination Event and the action which
the Transferor proposes to take with respect thereto.
(iii) Change in Credit and Collection Policy. Within
15 days after the date any material change in or amendment to the
Credit and Collection Policy is made, a copy of the Credit and
Collection Policy then in effect indicating such change or amendment.
0104420.05-01S7a
60
(iv) ERISA. Promptly after the filing or receiving
thereof, copies of all reports and notices with respect to any
"reportable event" (as defined in Article IV of ERISA) which the
Transferor, Tech Data or any Affiliate of the Transferor files under
ERISA with the Internal Revenue Service, the Pension Benefit Guaranty
Corporation or the U.S. Department of Labor or which the Transferor,
Tech Data or any Affiliates of the Transferor receives from the
Internal Revenue Service, the Pension Benefit Guaranty Corporation or
the U.S. Department of Labor.
(v) Other Information. Such other
information (including non-financial in- formation) as the Agent, or
the Administrative Agent, may from time to time reasonably re- quest.
(b) Conduct of Business. The Transferor
will carry on and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently conducted and do
all things necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of incorporation and
maintain all requisite authority to conduct its business in each jurisdiction in
which its business is conducted.
(c) Compliance with Laws. The Transferor
will comply in all material respects with all laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards to which it may be subject.
(d) Furnishing of Information and Inspec-
tion of Records. The Transferor will furnish to the Agent from time to time such
information with respect to the Receivables as the Agent may reasonably request,
including, without limitation, listings identifying the Obligor and the
Outstanding Balance for each Receivable. The Transferor will at any time and
from time to time during regular business hours upon forty-eight (48) hours
prior written notice, permit the Agent, or its agents or representatives, (i) to
examine and make copies of and abstracts from all Records and (ii) to visit the
offices and properties of the Transferor or Tech Data, as appli-
0104420.05-01S7a
61
cable, for the purpose of examining such Records, and to discuss matters
relating to Receivables or the Transferor's performance hereunder with any of
the officers, directors, employees or independent public accountants of the
Transferor having knowledge of such matters.
(e) Keeping of Records and Books of
Account. The Transferor will maintain and implement administrative and operating
procedures (including, without limitation, an ability to recreate records
evidencing Receivables in the event of the destruction of the originals
thereof), and keep and maintain, all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit the daily
identification of each new Receivable and all Collections of and adjustments to
each existing Receivable); provided, that the Transferor shall not be required
to keep and maintain such records with respect to any Receivables for a period
of more than sixty (60) days after such Receivables shall have been paid in full
by the Obligors thereof. The Transferor will give the Agent notice of any
material change in the administrative and operating procedures referred to in
the previous sentence.
(f) Performance and Compliance with
Receivables and Contracts. The Transferor will at its expense timely and fully
perform and comply with all material provisions, covenants and other promises
required to be observed by it under the Contracts related to the Receivables.
(g) Credit and Collection Policies. The
Transferor will comply in all material respects with the Credit and Collection
Policy in regard to each Receivable and the related Contract.
(h) Collections. The Transferor shall
instruct all Obligors to cause all Collections to be
deposited directly to a Lock-Box Account.
(i) Collections Received by Transferor.
The Transferor shall hold in trust, and deposit, immediately, but in any event
not later than forty-eight (48) hours of its receipt thereof, to a Lock-Box
Account all Collections received from time to time by the Transferor
0104420.05-01S7a
62
(including without limitation, in the case of the Trans- feror, all Collections
deemed to have been received by the Transferor under Section 2.9(a)).
SECTION 5.2. Negative Covenants of Transferor. At all times
from the date hereof to the later to occur of (i) the Termination Date or (ii)
the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless the Agent shall otherwise
consent in writing:
(a) No Sales, Liens, Etc. Except as
otherwise provided herein, the Transferor will not sell, assign (by operation of
law or otherwise) or otherwise dispose of, or create or suffer to exist any
Adverse Claim upon (or the filing of any financing statement) or with respect to
(x) any of the Affected Assets, (y) any inventory or goods, the sale of which
may give rise to a Receivable or any Receivable or related Contract, or (z) any
account which concentrates in a Lock-Box Bank to which any Collections of any
Receivable are sent, or assign any right to receive income in respect thereof.
(b) No Extension or Amendment of Receiv-
▇▇▇▇▇. Except as otherwise permitted in Section 6.2 hereof, the Transferor will
not extend, amend or otherwise modify the terms of any Receivable, or amend,
modify or waive any term or condition of any Contract related thereto.
(c) No Change in Business or Credit and
Collection Policy. The Transferor will not make any change in the character of
its business or in the Credit and Collection Policy, which change would, in
either case, impair the collectibility of the Receivables in a material respect.
(d) No Mergers, Etc. The Transferor will
not (i) consolidate or merge with or into any other Person, or (ii) sell, lease
or transfer all or substantially all of its assets to any other person;
provided, however, that so long as the Transferor remains wholly owned by Tech
Data, the foregoing prohibitions will not apply.
0104420.05-01S7a
63
(e) Change in Payment Instructions to
Obligors. The Transferor will not add or terminate any bank as a Lock-Box Bank
or any account as a Lock-Box Account to or from those listed in Exhibit C hereto
or make any change in its instructions to Obligors regarding payments to be made
to any Lock-Box Account, unless (i) such instructions are to deposit such
payments to another existing Lock-Box Account or (ii) the Agent shall have
received written notice of such addition, termination or change at least 30 days
prior thereto and the Agent shall have received a Lock-Box Agreement executed by
each new Lock-Box Bank or an existing Lock-Box Bank with respect to each new
Lock-Box Account, as applicable.
(f) Deposits to Lock-Box Accounts. The
Transferor will not deposit or otherwise credit, or cause or permit to be so
deposited or credited, to any Lock-Box Account cash or cash proceeds other than
Collections of Receivables or cash proceeds of other receivables that were
originally Receivables but were not Eligible Receivables on the date of the
initial Transfer hereunder and so were subsequently repurchased by the
Transferor pursuant to Section 2.9 and, upon any deposit of any proceeds of such
other receivables to any Lock-Box Account, remove such proceeds within two
Business Days following such deposit.
(g) Change of Name, Etc. The Transferor
will not change its name, identity or structure or the location of its chief
executive office, unless at least 10 days prior to the effective date of any
such change the Transferor delivers to the Agent (i) such documents, instruments
or agreements, executed by the Transferor, necessary to reflect such change and
to continue the perfection of the Agent's ownership interests or security
interests in the Affected Assets and (ii) new or revised Lock-Box Agreements
executed by the Lock-Box Banks which reflect such change and enable the Agent to
continue to exercise its rights contained in Section 2.8 hereof.
(h) Amendment to Purchase Agreement. The
Transferor will not amend, modify, or supplement the Purchase Agreement between
the Transferor and Tech Data, except that the Transferor may, upon 15 days prior
written notice to the Agent and the Administrative Agent, enter into an
amendment, modification or supplement to the Purchase Agreement, provided the
same shall not mate-
0104420.05-01S7a
64
rially adversely affect the interests of the Agent, the Company or any Bank
Investor; nor shall the Transferor take any other action under the Purchase
Agreement that shall have the same such affect upon the interests of the Agent,
the Company, or any Bank Investor.
SECTION 5.3. Affirmative Covenants of Tech Data. At all times
from the date hereof to the later to occur of (i) the Termination Date or (ii)
the date on which the Transferred Interest shall be equal to zero, unless the
Agent shall otherwise consent in writing:
(a) Financial Reporting. Tech Data will
maintain, for itself, a system of accounting established and administered in
accordance with generally accepted accounting principles, and furnish to the
Agent and each Bank Investor:
(i) Annual Reporting. Within one hundred and twenty
(120) days after the close of each of its fiscal years, an unqualified
audit report certified by independent certified public accountants,
acceptable to the Agent, prepared in accordance with generally accepted
accounting principles on a consolidated and consolidating basis
(consolidating statements need not be certified by such accountants)
for itself including balance sheets as of the end of such period,
related profit and loss and reconciliation of surplus statements, and a
statement of cash flows, accompanied by any management letter prepared
by said accountants and by a certificate of said accountants that, in
the course of the foregoing, they have obtained no knowledge of any
Termination Event or Potential Termination Event, or if, in the opinion
of such accountants, any Termination Event or Potential Termination
Event shall exist, stating the nature and status thereof.
(ii) Quarterly Reporting. With-
in sixty (60) days after the close of the first three quarterly periods
of each of its fiscal years, for itself consolidated and consolidating
unaudited balance sheets as at the close of each such period and
consolidated and ▇▇▇▇▇▇▇-
0104420.05-01S7a
65
dating profit and loss and reconciliation of surplus statements and a
statement of cash flows for the period from the beginning of such
fiscal year to the end of such quarter, all certified by its chief
financial officer.
(iii) Compliance Certificate. Together with the
financial statements required hereunder, a compliance certificate
signed by its chief financial officer stating that no Termination Event
or Potential Termination Event exists, or if any Termination Event or
Potential Termination Event exists, stating the nature and status
thereof and containing a computation of, and showing compliance with,
each of the financial ratios and restrictions contained in this
Agreement and showing all information necessary in order to determine
the Applicable Margin.
(iv) Shareholders Statements and
Reports. Promptly upon the furnishing thereof to the shareholders of
Tech Data, copies of all financial statements, reports and proxy
statements so furnished.
(v) S.E.C. Filings. Promptly
upon the filing thereof, copies of all registration statements and
nnual, quarterly, monthly or other regular reports which Tech Data
or any subsidiary files with the Securities and Exchange Commission.
(vi) Other Information. Such
other information (including non-financial in- formation) as the Agent
may from time to time reasonably request.
(b) Conduct of Business. Tech Data will,
and will cause each of its Subsidiaries to, carry on and conduct its business in
substantially the same manner and in substantially the same fields of enterprise
as it is presently conducted and to do all things necessary to remain duly
incorporated, validly existing and in good standing as a domestic corporation in
its jurisdiction of incorporation and maintain all requisite authority to
0104420.05-01S7a
66
conduct its business in each jurisdiction in which its
business is conducted.
(c) Compliance with Laws. Tech Data
will, and will cause each of its Subsidiaries to, comply in all material
respects with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it or its properties may be subject.
(d) Furnishing of Information and Inspec-
tion of Records. Tech Data will furnish to the Transfer- or and the Agent from
time to time such information with respect to the Receivables as the Transferor
or the Agent may reasonably request, including, without limitation, listings
identifying the Obligor and the Outstanding Balance for each Receivable. Tech
Data will at any time and from time to time during regular business hours upon
forty-eight (48) hours prior written notice, permit the Agent, or its agents or
representatives, (i) to examine and make copies of and abstracts from all
Records and (ii) to visit the offices and properties of Tech Data for the
purpose of examining such Records, and to discuss matters relating to
Receivables or Tech Data's performance hereunder with any of the officers,
directors, employees or independent public accountants of Tech Data having
knowledge of such matters.
(e) Keeping of Records and Books of
Account. Tech Data will maintain and implement administrative and operating
procedures (including, without limitation, an ability to recreate records
evidencing Receivables in the event of the destruction of the originals
thereof), and keep and maintain, all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit the daily
identification of each new Receivable and all Collections of and adjustments to
each existing Receivable); provided, that Tech Data shall not be required to
keep and maintain such records with respect to any Receivables for a period of
more than sixty (60) days after such Receivables shall have been paid in full by
the Obligors thereof. Tech Data will give the Agent notice of any material
change in the administrative and operating procedures referred to in the
previous sentence.
0104420.05-01S7a
67
(f) Performance and Compliance with
Receivables and Contracts. Tech Data, at its expense, will timely and fully
perform and comply with all material provisions, covenants and other promises
required to be observed by it under the Contracts related to the Receivables.
(g) Credit and Collection Policies. Tech
Data will comply in all material respects with the Credit and Collection Policy
in regard to each Receivable and the related Contract.
(h) Collections. Tech Data shall in-
struct all Obligors to cause all Collections to be depos-
ited directly to a Lock-Box Account.
(i) Collections Received by Tech Data.
Tech Data shall hold in trust, and deposit, immediately, but in any event not
later than forty-eight (48) hours of its receipt thereof, to a Lock-Box Account
or the Collection Agent Account all Collections received from time to time by
Tech Data.
(j) Transfer of Receivables. Tech Data
shall sell or contribute Receivables (as defined in the Purchase Agreement) to
the Transferor at such time or times as necessary in order to cause the
Percentage Factor not to exceed the Maximum Percentage Factor.
SECTION 5.4. Negative Covenants of Tech Data. At all times
from the date hereof to the later to occur of (i) the Termination Date or (ii)
the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless the Agent shall otherwise
consent in writing:
(a) No Sales, Liens, Etc. Except as
otherwise provided herein and in the Receivables Purchase Agreement, Tech Data
will not sell, assign (by operation of law or otherwise) or otherwise dispose
of, or create or suffer to exist any Adverse Claim upon (or the filing of any
financing statement) or with respect to (x) any of the Affected Assets, (y) any
inventory or goods, the sale of which may give rise to a Receivable or any
Receivable or related Contract, or (z) any account which concen-
▇▇▇▇▇▇▇.05-01S7a
68
trates in a Lock-Box Bank to which any Collections of any Receivable are sent,
or assign any right to receive income in respect thereof.
(b) No Extension or Amendment of Receiv-
▇▇▇▇▇. Except as otherwise permitted in Section 6.2 hereof, Tech Data will not
extend, amend or otherwise modify the terms of any Receivable, or amend, modify
or waive any term or condition of any Contract related thereto.
(c) No Change in Business or Credit and
Collection Policy. Tech Data will not make any change in the character of its
business or in the Credit and Collection Policy, which change would, in either
case, impair the collectibility of the Receivables in a material respect.
(d) No Mergers, Etc. Tech Data will not
(i) consolidate or merge with or into any other Person if such action shall
result in a Potential Termination Event or a Termination Event and Tech Data
shall not be the surviving entity or (ii) sell, lease or transfer all or
substantially all of its assets to any other person.
(e) Change in Payment Instructions to
Obligors. Tech Data will not add or terminate any bank as a Lock-Box Bank or any
account as a Lock-Box Account to or from those listed in Exhibit C hereto or
make any change in its instructions to Obligors regarding payments to be made to
any Lock-Box Account, unless (i) such instructions are to deposit such payments
to another existing Lock-Box Account or (ii) the Agent shall have received
written notice of such addition, termination or change at least 30 days prior
thereto and the Agent shall have received a Lock-Box Agreement executed by each
new Lock-Box Bank or an existing Lock-Box Bank with respect to each new Lock-Box
Account, as applicable.
(f) Deposits to Lock-Box Accounts. Tech
Data will not deposit or otherwise credit, or cause or permit to be so deposited
or credited, to any Lock-Box Account cash or cash proceeds other than
Collections of Receivables or cash proceeds or other receivables that were
originally Receivables but were not Eligible Receivables on the date of the
initial Transfer hereunder and so were subsequently repurchased by the
Transferor pursu-
0104420.05-01S7a
69
ant to Section 2.9 and, upon any deposit of any proceeds of such other
receivables to any Lock-Box Account, remove such proceeds within two Business
Days following such deposit.
(g) Change of Name, Etc. Tech Data will
not change its name, identity or structure or location of its chief executive
office, unless at least 10 days prior to the effective date of any such change
Tech Data delivers to the Transferor and the Agent (i) such documents,
instruments or agreements, executed by the Transferor, as are necessary to
reflect such change and to continue the perfection of the Transferor's ownership
interest in the Receivables and (ii) new or revised Lock-Box Agreements executed
by the Lock-Box Banks which reflect such change and enable the Agent to continue
to exercise its rights contained in Section 2.8 hereof.
SECTION 5.5. Financial Covenants.
(a) Indebtedness to Total Capital.
Tech Data shall not permit the ratio of Consolidated Funded
Indebtedness to Consolidated Total Capital to exceed .60 to 1.00 at any
time.
(b) EBIT to Interest Expense. Tech Data shall not
permit the ratio of Consolidated EBIT to Consolidated Interest Expense
to be less than 2.50 to 1.00 at any time.
Capitalized terms used in this Section 5.5 and not defined
herein shall have those meanings assigned in Exhibit N.
0104420.05-01S7a
70
ARTICLE VI
ADMINISTRATION AND COLLECTIONS
SECTION 6.1. Appointment of Collection Agent. The servicing,
administering and collection of the Receivables shall be conducted by such
Person (the "Collection Agent") so designated from time to time in accordance
with this Section 6.1. Until the Agent gives notice to Tech Data of the
designation of a new Collection Agent, Tech Data is hereby designated as, and
hereby agrees to perform the duties and obligations of, the Collection Agent
pursuant to the terms hereof. The Collection Agent may not delegate any of its
rights, duties or obligations hereunder, or designate a substitute Collection
Agent, without the prior written consent of the Agent, and provided that the
Collection Agent shall continue to remain solely liable for the performance of
the duties as Collection Agent hereunder. The Agent may, and upon the direction
of the Majority Investors, shall, after the occurrence of a Collection Agent
default or any other Termination Event designate as Collection Agent any Person
(including itself) to succeed Tech Data or any successor Collection Agent, on
the condition in each case that any such Person so designated shall agree to
perform the duties and obligations of the Collection Agent pursuant to the terms
hereof. The Agent, at any time following the occurrence of a Termination Event,
may notify any Obligor of the Transferred Interest.
SECTION 6.2. Duties of Collection Agent.
(a) Subject to the limitations contained
herein, the Collection Agent shall take or cause to be taken all such action as
may be necessary or advisable to collect each Receivable from time to time, all
in accordance with applicable laws, rules and regulations, with reasonable care
and diligence, and in accordance with the Credit and Collection Policy. Each of
the Transferor, the Company, the Agent and the Bank Investors hereby appoints as
its agent the Collection Agent, from time to time designated pursuant to Section
6.1 hereof, to enforce its respective rights and interests in and under the
Affected Assets. To the extent permitted by applicable law, each of the
Transferor and the Seller (to the extent not then acting as Collection Agent
hereunder)
0104420.05-01S7a
71
hereby grants to any Collection Agent appointed hereunder an irrevocable power
of attorney to take any and all steps in the Transferor's and/or the Seller's
name and on behalf of the Transferor or the Seller necessary or desirable, in
the reasonable determination of the Collection Agent, to collect all amounts due
under any and all Receivables, including, without limitation, endorsing the
Transferor's and/or the Seller's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Contracts. The Collection Agent shall set aside for the account of the
Transferor and the Company or the Bank Investors their respective allocable
shares of the Collections of Receivables in accordance with Sections 2.5 and 2.6
hereof. The Collection Agent shall segregate and deposit to the Agent's account
the Company's and the Bank Investors' allocable share of Collections of
Receivables when required pursuant to Article II hereof. So long as no
Termination Event shall have occurred and be continuing, the Collection Agent
may, in accordance with the Credit and Collection Policy, extend the maturity of
Receivables, but not beyond 60 days, and extend the maturity or adjust the
Outstanding Balance as the Collection Agent may determine to be appropriate to
maximize Collections thereof; provided, however, that such extension or
adjustment shall not alter the status of such Receivable as a Delinquent
Receivable or a Defaulted Receivable. The Transferor shall deliver to the
Collection Agent and the Collection Agent shall hold in trust for the
Transferor, the Company, the Agent and the Bank Investors, in accordance with
their respective interests, all Records which evidence or relate to Receivables
or Related Security. Notwithstanding anything to the contrary contained herein,
the Agent shall have the absolute and unlimited right to direct the Transferor,
if Tech Data is the Collection Agent, or if Tech Data is not the Collection
Agent, the Collection Agent to commence or settle any legal action to enforce
collection of any Receivable or to foreclose upon or repossess any Related
Security. The Collection Agent shall not make the Agent, the Company or any of
the Bank Investors a party to any litigation without the prior written consent
of such Person.
(b) The Collection Agent shall, as soon
as practicable following receipt of any Collections, turn over to the Transferor
an amount equal to such Collections minus the Percentage Factor of such
Collections.
0104420.05-01S7a
72
In addition, the Collection Agent shall, as soon as practicable following
receipt thereof, turn over to the Transferor any collections of any indebtedness
of any Obligor which is not a Receivable. If the Collection Agent is not Tech
Data or the Transferor or any Affiliate of the Transferor or Tech Data, the
Collection Agent, by giving three Business Days' prior written notice to the
Agent, may revise the percentage used to calculate the Servicing Fee so long as
the revised percentage will not result in a Servicing Fee that exceeds 110% of
the reasonable and appropriate out-of-pocket costs and expenses of such
Collection Agent incurred in connection with the performance of its obligations
hereunder as documented to the reasonable satisfaction of the Agent. The
Collection Agent, if other than Tech Data, shall as soon as practicable upon
demand, deliver to the Transferor all Records in its possession which evidence
or relate to indebtedness of an Obligor which is not a Receivable, and copies of
Records in its possession which evidence or relate to Receivables.
(c) On or before 120 days after the end
of each fiscal year of the Collection Agent, beginning with the fiscal year
ending January 31, 1997, the Collection Agent shall cause a firm of independent
public accountants (who may also render other services to the Collection Agent
or the Transferor) to furnish a report to the Agent to the effect that they have
(i) confirmed the Net Receivables Balance as of the end of each Tranche Period
during such fiscal year, and (ii) confirmed that the Receivables treated by the
Collection Agent as Eligible Receivables in fact satisfied the requirements of
the definition thereof contained herein, except, in each case for (a) such
exceptions as such firm shall believe to be immaterial (which exceptions need
not be enumerated) and (b) such other exceptions as shall be set forth in such
statement.
(d) Notwithstanding anything to the
contrary contained in this Article VI, the Collection Agent, if not Tech Data,
the Transferor, or any Affiliate of the Transferor or Tech Data, shall have no
obligation to collect, enforce or take any other action described in this
Article VI with respect to any indebtedness that is not included in the
Transferred Interest other than to deliver to the Transferor the collections and
documents
0104420.05-01S7a
73
with respect to any such Receivable as described in
Section 6.2(b) hereof.
SECTION 6.3. Rights After Designation of New Collection Agent.
At any time following the designation of a Collection Agent (other than Tech
Data, the Trans- feror, or any Affiliate of Tech Data or the Transferor)
pursuant to Section 6.1 hereof:
(i) The Agent may direct that payment of all amounts
payable under any Receivable be made directly to the Agent or its
designee.
(ii) Tech Data shall, at the Agent's request and at
Tech Data's expense, give notice of the Agent's, the Transferor's, the
Company's and/or the Bank Investor's ownership of Receivables to each
Obligor and direct that payments be made directly to the Agent or its
designee.
(iii) Tech Data shall, at the Agent's request, (A)
assemble all of the Records, and shall make the same available to the
Agent at a place selected by the Agent or its designee, and (B)
segregate all cash, checks and other instruments received by it from
time to time constituting Collections of Receivables in a manner
acceptable to the Agent and shall, promptly upon receipt, remit all
such cash, checks and instruments, duly endorsed or with duly executed
instruments of transfer, to the Agent or its designee.
(iv) The Transferor and Tech Data hereby authorize
the Agent to take any and all steps in the Transferor's or Tech Data's
name and on behalf of the Transferor or Tech Data necessary or
desirable, in the determination of the Agent, to collect all amounts
due under any and all Receivables, including, without limitation,
endorsing the Transferor's or Tech Data's name on checks and other
instruments representing Collections and enforcing such Receivables and
the related Contracts.
0104420.05-01S7a
74
SECTION 6.4. Responsibilities of the Trans- feror and Tech
Data. Anything herein to the contrary notwithstanding, the Transferor and Tech
Data, as seller under the Purchase Agreement, shall (i) perform all of their
respective obligations under the Contracts related to the Receivables to the
same extent as if interests in such Receivables had not been sold hereunder and
the exercise by the Agent of its rights hereunder shall not relieve the
Transferor or Tech Data, as seller under the Purchase Agreement, from such
obligations and (ii) pay when due any taxes, including without limitation, any
sales taxes payable in connection with the Receivables and their creation and
satisfaction. Neither the Agent nor the Company nor any of the Bank Investors
shall have any obligation or liability with respect to any Receivable or related
Contracts, nor shall it be obligated to perform any of the obligations of the
Transferor or Tech Data thereunder.
0104420.05-01S7a
75
ARTICLE VII
TERMINATION EVENTS
SECTION 7.1. Termination Events. The occur-
rence of any one or more of the following events shall
constitute a Termination Event:
(a) (i) the Collection Agent shall fail
to perform or observe any term, covenant or agreement hereunder (other than as
referred to in clause (ii) of this Section 7.1(a)) and such failure shall remain
unremedied for 15 days, or (ii) either the Collection Agent, the Transferor, or
the Guarantor shall fail to make any payment or deposit to be made by it
hereunder when due or the Collection Agent shall fail to observe or perform any
term, covenant or agreement on the Collection Agent's part to be performed under
Section 2.8(b) hereof; or
(b) any representation, warranty, certif-
ication or statement made by Tech Data or the Transferor in this Agreement or in
any other document delivered pursuant hereto shall prove to have been incorrect
in any material respect when made or deemed made; or
(c) (i) the Transferor shall default in
the observance or performance of the terms, covenants, conditions or agreements
on the Transferor's part to be performed or observed under Section 4.2, Section
5.1(a)(ii), Section 5.1(h), Section 5.1(i), Section 5.2(a), Section 5.2(c),
Section 5.2(d), Section 5.2(e), Section 5.2(f), Section 5.2(g) or Section 5.2(h)
hereof or (ii) the Transferor shall default in the observance or performance of
the terms, covenants, conditions or agreements on the Transferor's part to be
performed or observed under Section 5.1(a)(i), Section 5.1(a)(iii), Section
5.1(a)(iv), Section 5.1(a)(v), Section 5.1(b), Section 5.1(c), Section 5.1(d),
Section 5.1(e), Section 5.1(f), Section 5.1(g) or Section 5.2(b) hereof and such
failure shall remain unremedied for 15 days; or
(d) (i) Tech Data shall default in the
observance or performance of the terms, covenants, conditions or agreements on
Tech Data's part to be performed or observed under Section 5.3(h), Section
5.3(i), Section 5.4(a), Section 5.4(c), Section 5.4(d), Section 5.4(e),
0104420.05-01S7a
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Section 5.4(f) or Section 5.5 or (ii) Tech Data shall default in the observance
or performance of the terms, covenants, conditions or agreements on Tech Data's
part to be performed under Section 5.3(a), Section 5.3(b), Section 5.3(c),
Section 5.3(d), Section 5.3(e), Section 5.3(f), Section 5.3(g) or Section 5.4(b)
hereof and such failure shall remain unremedied for 15 days; or
(e) the Transferor or Tech Data shall de-
fault in the observance or performance of any other term, covenant, condition or
agreement on the Transferor's or Tech Data's part to be performed or observed
under this Agreement and such default shall continue for 30 days after the
earlier of (i) the date that such written notice thereof is given to the
Transferor or Tech Data, as applicable, by the Agent or (ii) the date the Trans-
feror or Tech Data, as applicable, becomes aware of such default; or
(f) failure of Tech Data or any Subsid-
iary of Tech Data to pay any Indebtedness greater than $500,000 when due; or the
default by Tech Data or any Subsidiary of Tech Data in the performance of any
term, provision or condition contained in any agreement under which any
Indebtedness greater than $500,000 was created or is governed, the effect of
which is to cause, or to permit the holder or holders of such Indebtedness
greater than $500,000 to cause, such Indebtedness to become due prior to its
stated maturity; or any Indebtedness greater than $500,000 shall be declared to
be due and payable or required to be prepaid (other than by a regularly
scheduled payment) prior to the date of maturity thereof; or
(g) any Event of Bankruptcy shall occur
with respect to the Transferor, the Collection Agent,
Tech Data or any Subsidiary of either the Transferor or
Tech Data; or
(h) the Agent, on behalf of the Company
and/or the Bank Investors, shall, for any reason, fail or cease to have a valid
and perfected first priority ownership or security interest in the Affected
Assets free and clear of any Adverse Claims; or
(i) Tech Data shall enter into any trans-
action or merger whereby it is not the surviving entity;
0104420.05-01S7a
77
or the Transferor shall no longer be wholly owned by Tech
Data; or
(j) there shall have occurred any materi-
al adverse change in the operations of Tech Data since October 31, 1996 or any
other event shall have occurred which materially affects Tech Data's ability to
either collect the Receivables or to perform under this Agreement or under the
Purchase Agreement; or
(k) the Liquidity Provider or the Credit
Support Provider shall have given notice that an event of default has occurred
and is continuing under any of its respective agreements with the Company; or
(l) the Commercial Paper issued by the
Company shall not be rated at least "A-2" by Standard & Poor's and at least
"P-2" by ▇▇▇▇▇'▇, unless such downgrading is the result of the Credit Support
Provider being downgraded; or
(m) the Percentage Factor exceeds the
Maximum Percentage Factor unless the Transferor reduces the Net Investment on
the next day or increases the balance of the Affected Assets on the next
Business Day so as to reduce the Percentage Factor to less than or equal to 98%;
or
(n) the Percentage Factor equals or ex-
ceeds 100% for a period of one full Business Day (provided that in such case the
Termination Event caused thereby shall be deemed to have occurred at the start
of such one full Business Day period) or the Net Investment plus the aggregate
Interest Component exceeds the Facility Limit; or
(o) the Dilution Ratio equals or exceeds
15%; or
(p) the average of the Loss to Liquida-
tion Ratios for any three consecutive months exceeds
2.25%; or
(q) the Delinquency Ratio exceeds 11%.
SECTION 7.2. Termination. (a) Upon the
occurrence of any Termination Event, the Agent may, or at
0104420.05-01S7a
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the direction of the Majority Investors shall, by notice to the Transferor and
the Collection Agent declare the Termination Date to have occurred; provided,
however, that in the case of any event described in Section 7.1(g), 7.1(h),
7.1(i) or 7.1(n) above, the Termination Date shall be deemed to have occurred
automatically upon the occurrence of such event. Upon any such declaration or
automatic occurrence, the Agent shall have, in addition to all other rights and
remedies under this Agreement or otherwise, all other rights and remedies
provided under the UCC of the applicable jurisdiction and other applicable laws,
all of which rights shall be cumulative.
(b) At all times after the declaration or automatic occurrence
of the Termination Date pursuant to Section 7.2(a) (other than a declaration
following the occurrence of a Termination Event set forth in Section 7.1(k) or
Section 7.1(l)), the Base Rate plus 2.00% shall be the Tranche Rate applicable
to the Net Investment for all existing and future Tranches.
0104420.05-01S7a
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ARTICLE VIII
INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 8.1. Indemnities by the Transferor. Without limiting
any other rights which the Agent, the Company or the Bank Investors may have
hereunder or under applicable law, the Transferor hereby agrees to indemnify the
Agent, the Company, the Bank Investors, the Administrative Agent, the Collateral
Agent, the Liquidity Provider and the Credit Support Provider and any successors
and any permitted assigns and their respective officers, directors and employees
(collectively, "Indemnified Parties") from and against any and all damages,
losses, claims, liabilities, costs and expenses, including, without limitation,
reasonable attorneys' fees (which such attorneys may be employees of the
Liquidity Provider, the Credit Support Provider, the Agent, the Administrative
Agent or the Collateral Agent, as applicable) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts") awarded
against or incurred by any of them arising out of or as a result of this
Agreement or the ownership, either directly or indirectly, by the Agent, the
Company or any Bank Investor of the Transferred Interest excluding, however, (i)
Indemnified Amounts to the extent resulting from gross negligence or willful
misconduct on the part of an Indemnified Party or (ii) recourse (except as
otherwise specifically provided in this Agreement) for uncollectible Receivables
or (iii) claims arising from credit losses. Without limiting the generality of
the foregoing, the Transferor shall indemnify each Indemnified Party for
Indemnified Amounts relating to or resulting from:
(i) reliance on any representation or warranty made
by the Transferor (or any officers of the Transferor) under or in
connection with this Agreement, any Investor Report or any other
information or report delivered by the Transferor pursuant hereto,
which shall have been false or incorrect in any material respect when
made or deemed made;
(ii) the failure by the Transferor to comply with
any applicable law, rule or regulation with respect to any Receivable
or
0104420.05-01S7a
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the related Contract, or the nonconformity of any Receivable or the
related Contract with any such applicable law, rule or regulation;
(iii) the failure to vest and maintain vested in the
Agent on behalf of the Company and/or the Bank Investors, an undivided
percentage ownership or security interest, to the extent of the
Transferred Interest, in the Receivables included in the Transferred
Interest, free and clear of any Adverse Claim;
(iv) the failure to file, or any delay in filing,
financing statements, continuation statements, or other similar
instruments or documents under the UCC of any applicable jurisdiction
or other applicable laws with respect to any of the Affected Assets;
(v) any dispute, claim, offset or defense (other than
discharge in bankruptcy) of the Obligor to the payment of any
Receivable included in the Transferred Interest (including, without
limitation, a defense based on such Receivable or the related Contract
not being legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms), or any other
claim resulting from the sale of merchandise or services related to
such Receivable or the furnishing or failure to furnish such
merchandise or services;
(vi) any failure of the Trans- feror, as Collection
Agent or otherwise, to perform its duties or obligations in accordance
with the provisions of Article VI; or
(vii) any products liability claim or personal injury
or property damage suit or other similar or related claim or action of
whatever sort arising out of or in connection with merchandise or
services which are the subject of any Receivable;
provided, however, that if the Company enters into agreements for the purchase
of interests in receivables from
0104420.05-01S7a
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one or more Other Transferors, the Company shall allocate such Indemnified
Amounts which are in connection with the Liquidity Provider Agreement, the
Credit Support Agreement or the credit support furnished by the Credit Support
Provider to the Transferor and each Other Trans- feror.
SECTION 8.2. Indemnity for Taxes, Reserves and Expenses. (a)
If after the date hereof, the adoption of any Law or bank regulatory guideline
or any amendment or change in the interpretation of any existing or future Law
or bank regulatory guideline by any Official Body charged with the
administration, interpretation or application thereof, or the compliance with
any directive of any Official Body (in the case of any bank regulatory
guideline, whether or not having the force of Law):
(i) shall subject any Indemnified Party to any tax,
duty or other charge with respect to this Agreement, the Transferred
Interest, the Receivables or payments of amounts due hereunder, or
shall change the basis of taxation of payments to any Indemnified Party
of amounts payable in respect of this Agreement, the Transferred
Interest, the Receivables or payments of amounts due hereunder or its
obligation to advance funds under the Liquidity Provider Agreement or
the credit support furnished by the Credit Support Provider or
otherwise in respect of this Agreement, the Transferred Interest or the
Receivables (except for changes in the rate of general corporate,
franchise, net income or other income tax imposed on such Indemnified
Party by the jurisdiction in which such Indemnified Party's principal
executive office is located);
(ii) shall impose, modify or deem applicable any
reserve, special deposit or similar requirement (including, without
limitation, any such requirement imposed by the Board of Governors of
the Federal Reserve System) against assets of, deposits with or for the
account of, or credit extended by, any Indemnified Party or shall
impose on any Indemnified Party or on the United States market for cer-
0104420.05-01S7a
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tificates of deposit or the London interbank market any other condition
affecting this Agreement, the Transferred Interest, the Receivables or
payments of amounts due hereunder or its obligation to advance funds
under the Liquidity Provider Agreement or the credit support provided
by the Credit Support Provider or otherwise in respect of this
Agreement, the Transferred Interest or the Receivables; or
(iii) imposes upon any Indemnified Party any other
expense (including, without limitation, reasonable attorneys' fees and
expenses, and expenses of litigation or preparation therefor in
contesting any of the foregoing) with respect to this Agreement, the
Transferred Interest, the Receivables or payments of amounts due
hereunder or its obligation to advance funds under the Liquidity
Provider Agreement or the credit support furnished by the Credit
Support Provider or otherwise in respect of this Agreement, the
Transferred Interests or the Receivables,
and the result of any of the foregoing is to increase the cost to such
Indemnified Party with respect to this Agreement, the Transferred Interest, the
Receivables, the obligations hereunder, the funding of any purchases hereunder,
the Liquidity Provider Agreement or the Credit Support Agreement, by an amount
deemed by such Indemnified Party to be material, then, within ten (10) days
after demand by such Indemnified Party through the Agent, the Transferor shall
pay to the Agent, for the benefit of such Indemnified Party such additional
amount or amounts as will compensate such Indemnified Party for such increased
cost or reduction.
(b) If any Indemnified Party shall have
determined that after the date hereof, the adoption of any applicable Law or
bank regulatory guideline regarding capital adequacy, or any change therein, or
any change in the interpretation thereof by any Official Body, or any directive
regarding capital adequacy (in the case of any bank regulatory guideline,
whether or not having the force of law) of any such Official Body, has or would
have the effect of reducing the rate of return on capital of such Indemnified
Party (or its parent) as a conse-
0104420.05-01S7a
83
quence of such Indemnified Party's obligations hereunder or with respect hereto
to a level below that which such Indemnified Party (or its parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Indemnified Party to be material, then from time to time, within ten
(10) days after demand by such Indemnified Party through the Agent, the
Transferor shall pay to the Agent, for the benefit of such Indemnified Party
such additional amount or amounts as will compensate such Indemnified Party (or
its parent) for such reduction.
(c) The Agent will promptly notify the
Transferor of any event of which it has knowledge, occurring after the date
hereof, which will entitle an Indemnified Party to compensation pursuant to this
Section. A notice by the Agent or the applicable Indemnified Party claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, the Agent or any applicable
Indemnified Party may use any reasonable averaging and attributing methods.
(d) Anything in this Section 8.2 to the
contrary notwithstanding, if the Company enters into agreements for the
acquisition of interests in receivables from one or more Other Transferors, the
Company shall allocate the liability for any amounts under this Section 8.2
("Section 8.2 Costs") to the Transferor and each Other Transferor; and provided,
further, that if such Section 8.2 Costs are attributable to the Transferor and
not attributable to any Other Transferor, the Trans- feror shall be solely
liable for such Section 8.2 Costs or if such Section 8.2 Costs are attributable
to Other Transferors and not attributable to the Transferor, such Other
Transferors shall be solely liable for such Section 8.2 Costs.
SECTION 8.3. Other Costs, Expenses and Related Matters. (a)
The Transferor agrees, upon receipt of a written invoice, to pay or cause to be
paid, and to save the Company and the Agent harmless against liability for the
payment of, all reasonable out-of-pocket expenses (including, without
limitation, attorneys', accountants' and other third parties' fees and expenses,
any filing
0104420.05-01S7a
84
fees and expenses incurred by officers or employees of the Company and the
Agent) incurred by or on behalf of the Company or the Agent (i) in connection
with the negotiation, execution, delivery and preparation of this Agreement and
any documents or instruments delivered pursuant hereto and thereto and the
transactions contemplated hereby or thereby (including, without limitation, the
perfection or protection of the Transferred Interest) and (ii) from time to time
relating to any amendments, waivers or consents under this Agreement.
(b) The Transferor agrees, upon receipt of a written invoice,
to pay or cause to be paid, and to save the Company, the Bank Investors and the
Agent harmless against liability for the payment of, all reasonable
out-of-pocket expenses (including, without limitation, attorneys', accountants'
and other third parties' fees and expenses, any filing fees and expenses
incurred by officers or employees of the Company, the Bank Investors and/or the
Agent) incurred by or on behalf of the Company, any Bank Investor or the Agent
from time to time (i) arising in connection with the Company's, any Bank
Investor's, the Agent's or the Collateral Agent's enforcement or preservation of
rights (including, without limitation, the perfection and protection of the
Transferred Interest under this Agreement), or (ii) arising in connection with
any audit, dispute, disagreement, litigation or preparation for litigation
involving this Agreement.
(c) The Transferor shall pay the Agent,
for the account of the Company and the Bank Investors, as applicable, on demand
any Early Collection Fee due on account of the reduction of a Tranche on a day
prior to the last day of its Tranche Period.
SECTION 8.4. Reconveyance Under Certain Circumstances. The
Transferor agrees to accept the recon- veyance from the Agent, on behalf of the
Company and/or the Bank Investors, of the Transferred Interest if the Agent
notifies Transferor of a material breach of any representation or warranty made
or deemed made pursuant to Article III of this Agreement and Transferor shall
fail to cure such breach within 15 days (or, in the case of the representations
and warranties in Sections 3.1(d) and 3.1(j), 3 days) of such notice. The
reconveyance price shall be paid by the Transferor to the Agent, for the account
of the Company and the Bank Investors, as
▇▇▇▇▇▇▇.05-01S7a
85
applicable, in immediately available funds on such 15th day (or 3rd day, if
applicable) in an amount equal to the Aggregate Unpaids.
0104420.05-01S7a
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ARTICLE IX
GUARANTEE
SECTION 9.1. Guaranty of Obligations. Tech Data
unconditionally guarantees the full and prompt payment when due of all of the
payment obligations and timely performance of all of the payment and performance
obligations ("Obligations") of the Transferor of every kind and nature now or
hereafter existing, or due or to become due, under this Agreement, to the
Transferor, the Company, the Agent or any Bank Investor. Tech Data shall pay all
reasonable costs and expenses including, without limitation, all court costs and
attorneys' fees and expenses paid or incurred by the Transferor, the Company,
the Agent or any Bank Investor in connection with the collection of all or any
part of the Obligations from Tech Data.
SECTION 9.2. Validity of Obligations; Irrevo- cability. Tech
Data agrees that its obligations under this guaranty shall be unconditional,
irrespective of (i) the validity, enforceability, discharge or disaffirmance (by
any Person, including a trustee in bankruptcy) of the Obligations or of this
Agreement, (ii) the absence of any attempt to collect the Obligations from the
Transferor or any guarantor, (iii) the waiver or consent by the Trans- feror,
Company, the Agent or any Bank Investor with respect to any provision of any
instrument evidencing the Obligations, (iv) any change of the time, manner or
place of payment or performance, or any other term of any of the Obligations,
(v) any law, regulation or order of any jurisdiction affecting any term of any
of the Obligations or rights of the Transferor, the Company, the Agent or any
Bank Investor with respect thereto, (vi) the failure by the Transferor, the
Company, the Agent or any Bank Investor to take any steps to perfect and
maintain perfected its respective interest in the Receivables or other property
acquired by the Company from the Trans- feror, or by the Transferor from Tech
Data or any security or collateral related to the Obligations or (vii) any other
circumstances which might otherwise constitute a legal or equitable discharge or
defense of a guarantor. Tech Data agrees that none of the Transferor, the
Company, the Agent or any Bank Investor shall be under any obligation to
▇▇▇▇▇▇▇▇ any assets in favor of or against or in payment of any or all of the
Obligations. Tech
0104420.05-01S7a
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Data further agrees that, to the extent that the Trans- feror makes a payment or
payments to the Company, the Agent or any Bank Investor, which payment or
payments or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to the
Transferor its estate, trustee, receiver or any other party, including without
limitation, Tech Data, under any bankruptcy, insolvency or similar state or
federal law, common law or equitable cause, then to the extent of such payment
or repayment, the Obligation or part thereof which has been paid, reduced or
satisfied by such amount shall be reinstated and continued in full force and
effect as of the date such initial payment, reduction or satisfaction occurred.
Tech Data waives all set-offs and counterclaims and all presentments, demands
for performance, notices of dishonor and notices of acceptance of this guaranty.
Tech Data agrees that its obligations under this guaranty shall be irrevocable.
SECTION 9.3. Rights of Set-Off. Tech Data hereby authorizes
the Transferor, the Company, the Agent or any Bank Investor at any time and from
time to time, to the fullest extent permitted by law, to set-off and apply any
and all deposits (whether general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by the
Transfer- or, the Company, the Agent or any Bank Investor to or for the credit
or the account of Tech Data against any and all of the obligations of Tech Data
now or hereafter existing under this Agreement to the Transferor or the Company.
Tech Data acknowledges that the Company's rights described in this Section 9.3
are in addition to other rights and remedies (including, without limitation,
other rights of set-off) the Transferor or the Company may have.
0104420.05-01S7a
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ARTICLE X
THE AGENT; BANK COMMITMENT
SECTION 10.1. Authorization and Action. (a) The Company and each Bank
Investor hereby appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers under this Agreement and the other
Transaction Documents as are delegated to the Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto. In
furtherance, and without limiting the generality, of the foregoing, the Company
and each Bank Investor hereby appoints the Agent as its agent to execute and
deliver all further instruments and documents, and take all further action that
the Agent may deem necessary or appropriate or that the Company or a Bank
Investor may reasonably request in order to perfect, protect or more fully
evidence the interests transferred or to be transferred from time to time by the
Transferor hereunder, or to enable any of them to exercise or enforce any of
their respective rights hereunder, including, without limitation, the execution
by the Agent as secured party/assignee of such financing or continuation
statements, or amendments thereto or assignments thereof, relative to all or any
of the Receivables now existing or hereafter arising, and such other instruments
or notices, as may be necessary or appropriate for the purposes stated
hereinabove. The Company and the Majority Investors may direct the Agent to take
any such incidental action hereunder. With respect to other actions which are
incidental to the actions specifically delegated to the Agent hereunder, the
Agent shall not be required to take any such incidental action hereunder, but
shall be required to act or to refrain from acting (and shall be fully protected
in acting or refraining from acting) upon the direction of the Majority
Investors; provided, however, that Agent shall not be required to take any
action hereunder if the taking of such action, in the reasonable determination
of the Agent, shall be in violation of any applicable law, rule or regulation or
contrary to any provision of this Agreement or shall expose the Agent to
liability hereunder or otherwise. Upon the occurrence and during the continuance
of any Termination Event or Potential Termination Event, the Agent shall take no
action hereunder (other than ministerial actions or such actions as are
specifically provided for herein) without the prior
0104420.05-01S7a
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consent of the Majority Investors (which consent shall not be unreasonably
withheld or delayed). The Agent shall not, without the prior written consent of
all Bank Investors, agree to (i) amend, modify or waive any provision of this
Agreement in any way which would (A) reduce or impair Collections or the payment
of Discount or fees payable hereunder to the Bank Investors or delay the
scheduled dates for payment of such amounts, (B) increase the Servicing Fee
(other than as permitted pursuant to Section 6.2(b)), (C) modify any provisions
of this Agreement or the Receivables Purchase Agreement relating to the timing
of payments required to be made by the Trans- feror, the Seller or the Guarantor
or the application of the proceeds of such payments, (D) permit the appointment
of any Person (other than the Agent) as successor Collection Agent, or (E)
release any property from the lien provided by this Agreement (other than as
expressly contemplated herein). The Agent shall not agree to any amendment of
this Agreement which increases the dollar amount of a Bank Investor's Commitment
without the prior consent of such Bank Investor. In addition, the Agent shall
not agree to any amendment of this Agreement not specifically described in the
two preceding sentences without the consent of the related Majority Investors
(which consent shall not be unreasonably withheld or delayed). "Majority
Investors" shall mean, at any time, the Agent and those Bank Investors which
hold Commitments aggregating in excess of 51% of the Facility Limit as of such
date. In the event the Agent requests the Company's or a Bank Investor's consent
pursuant to the foregoing provisions and the Agent does not receive a consent
(either positive or negative) from the Company or such Bank Investor within 10
Business Days of the Company's or Bank Investor's receipt of such request, then
the Company or such Bank Investor (and its percentage interest hereunder) shall
be disregarded in determining whether the Agent shall have obtained sufficient
consent hereunder.
(b) The Agent shall exercise such rights
and powers vested in it by this Agreement and the other Transaction Documents,
and use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs.
0104420.05-01S7a
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SECTION 10.2. Agent's Reliance, Etc. Neither the Agent nor any
of its directors, officers, agents or employees shall be liable for any action
taken or omitted to be taken by it or them as Agent under or in connection with
this Agreement or any of the other Transaction Documents, except for its or
their own gross negligence or willful misconduct. Without limiting the
foregoing, the Agent: (i) may consult with legal counsel (including counsel for
the Transferor or the Seller), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (ii) makes no warranty or representation to the Company
or any Bank Investor and shall not be responsible to the Company or any Bank
Investor for any statements, warranties or representations made in or in
connection with this Agreement; (iii) shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of this Agreement or any of the other Transaction Documents on the
part of the Transferor, the Collection Agent or Tech Data or to inspect the
property (including the books and records) of the Transferor, the Collection
Agent or Tech Data (iv) shall not be responsible to the Company or any Bank
Investor for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any of the other Transaction Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(v) shall incur no liability under or in respect of this Agreement or any of the
other Transaction Documents by acting upon any notice (including notice by
telephone), consent, certificate or other instrument or writing (which may be by
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 10.3. Credit Decision. The Company and each Bank
Investor acknowledges that it has, independently and without reliance upon the
Agent, any of the Agent's Affiliates, any other Bank Investor or the Company (in
the case of any Bank Investor) and based upon such documents and information as
it has deemed appropriate, made its own evaluation and decision to enter into
this Agreement and the other Transaction Documents to which it is a party and,
if it so determines, to accept the trans-
0104420.05-01S7a
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fer of any undivided ownership interest in the Affected Assets hereunder. The
Company and each Bank Investor also acknowledges that it will, independently and
without reliance upon the Agent, any of the Agent's Affiliates, any other Bank
Investor or the Company (in the case of any Bank Investor) and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own decisions in taking or not taking action under this Agreement and
the other Transaction Documents to which it is a party.
SECTION 10.4. Indemnification of the Agent. The Bank Investors
agree to indemnify the Agent (to the extent not reimbursed by the Transferor),
ratably in accordance with their Pro Rata Shares, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent in any way relating to or
arising out of this Agreement or any action taken or omitted by the Agent, any
of the other Transaction Documents hereunder or thereunder, provided that the
Bank Investors shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, the Bank Investors agree to
reimburse the Agent, ratably in accordance with their Pro Rata Shares, promptly
upon demand for any out-of-pocket expenses (including counsel fees) incurred by
the Agent in connection with the administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
and the other Transaction Documents, to the extent that such expenses are
incurred in the interests of or otherwise in respect of the Bank Investors
hereunder and/or thereunder and to the extent that the Agent is not reimbursed
for such expenses by the Transferor.
SECTION 10.5. Successor Agent. The Agent may resign at any
time by giving written notice thereof to each Bank Investor, the Company
and the Transferor and may be removed at any time with cause by the Majority
Investors. Upon any such resignation or removal, (i) if no Termination Event
shall have occurred, the Transferor
0104420.05-01S7a
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shall appoint a successor Agent and (ii) if a Termination Event shall have
occurred, the Company and the Majority Investors shall appoint a successor
Agent. The Transfer- or and the Company and each Bank Investor, as applicable,
each agrees that it shall not unreasonably withhold or delay its approval of the
appointment of a successor Agent. If no such successor Agent shall have been so
appointed, and shall have accepted such appointment, within 30 days after the
retiring Agent's giving of notice of resignation or the Majority Investors'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Company and the Bank Investors, appoint a successor Agent which successor Agent
shall be either (i) a commercial bank organized under the laws of the United
States or of any state thereof and have a combined capital and surplus of at
least $50,000,000 or (ii) an Affiliate of such a bank. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent, such successor Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Agent's resignation or removal hereunder as Agent, the provisions of
this Article IX shall continue to inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
SECTION 10.6. Payments by the Agent. Unless specifically
allocated to a Bank Investor pursuant to the terms of this Agreement, all
amounts received by the Agent on behalf of the Bank Investors shall be paid by
the Agent to the Bank Investors (at their respective accounts specified in their
respective Assignment and Assumption Agreements) in accordance with their
respective related pro rata interests in the Net Investment on the Business Day
received by the Agent, unless such amounts are received after 12:00 noon on such
Business Day, in which case the Agent shall use its reasonable efforts to pay
such amounts to the Bank Investors on such Business Day, but, in any event,
shall pay such amounts to the Bank Investors in accordance with their respective
related pro rata interests in the Net Investment not later than the following
Business Day.
0104420.05-01S7a
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SECTION 10.7. Bank Commitment; Assignment to
Bank Investors.
(a) Bank Commitment. At any time on or
prior to the Commitment Termination Date, in the event that the Company does not
effect an Incremental Transfer as requested under Section 2.2(a), then at any
time, the Transferor shall have the right to require the Company to assign its
interest in the Net Investment in whole to the Bank Investors pursuant to this
Section 10.7. In addition, at any time on or prior to the Commitment Termination
Date (i) upon the occurrence of a Termination Event that results in a
Termination Date or (ii) the Company elects to give notice to the Transferor of
a Reinvestment Termination Date, the Transferor hereby requests and directs that
the Company assign its interest in the Net Investment in whole to the Bank
Investors pursuant to this Section 10.7 and the Transferor hereby agrees to pay
the amounts described in Section 10.7(d) below. Provided that the Net Asset Test
is satisfied, upon any such election by the Company or any such request by the
Transfer- or, the Company shall make such assignment and the Bank Investors
shall accept such assignment and shall assume all of the Company's obligations
hereunder. In connection with any assignment from the Company to the Bank
Investors pursuant to this Section 10.7, each Bank Investor shall, on the date
of such assignment, pay to the Company an amount equal to its Assignment Amount.
Upon any assignment by the Company to the Bank Investors contemplated hereunder,
the Company shall cease to make any additional Incremental Transfers hereunder.
(b) Assignment. No Bank Investor may
assign all or a portion of its interests in the Net Investment, the Receivables,
and Collections, Related Security and Proceeds with respect thereto and its
rights and obligations hereunder to any Person unless approved in writing by the
Agent. In the case of an assignment by the Company to the Bank Investors or by a
Bank Investor to another Person, the assignor shall deliver to the assignee(s)
an Assignment and Assumption Agreement in substantially the form of Exhibit G
attached hereto, duly executed, assigning to the assignee a pro rata interest in
the Net Investment, the Receivables, and Collections, Related Security and
Proceeds with respect thereto and the assignor's rights and obligations
hereunder and the
0104420.05-01S7a
94
assignor shall promptly execute and deliver all further instruments and
documents, and take all further action, that the assignee may reasonably
request, in order to protect, or more fully evidence the assignee's right, title
and interest in and to such interest and to enable the Agent, on behalf of such
assignee, to exercise or enforce any rights hereunder and under the other
Transaction Documents to which such assignor is or, immediately prior to such
assignment, was a party. Upon any such assignment, (i) the assignee shall have
all of the rights and obligations of the assignor hereunder and under the other
Transaction Documents to which such assignor is or, immediately prior to such
assignment, was a party with respect to such interest for all purposes of this
Agreement and under the other Transaction Documents to which such assignor is
or, immediately prior to such assignment, was a party (it being understood that
the Bank Investors, as assignees, shall (x) be obligated to effect Incremental
Transfers under Section 2.2(a) in accordance with the terms thereof,
notwithstanding that the Company was not so obligated and (y) not have the right
to elect the commencement of the amortization of the Net Investment pursuant to
the definition of "Rein- vestment Termination Date", notwithstanding that the
Company had such right) and (ii) the assignor shall relinquish its rights with
respect to such interest for all purposes of this Agreement and under the other
Transaction Documents to which such assignor is or, immediately prior to such
assignment, was a party. No such assignment shall be effective unless the
Administrative Agent, on behalf of the Company, and the Transferor shall have
consented thereto and a fully executed copy of the related Assignment and
Assumption Agreement shall be delivered to the Agent. All costs and expenses of
the Agent and the initial Bank Investor as assignor incurred in connection with
any assignment hereunder shall be borne by the Transferor and not by the Agent
or the initial Bank Investor. No Bank Investor shall assign any portion of its
Commitment hereunder without also simultaneously assigning an equal portion of
its interest in the Liquidity Provider Agreement.
(c) Effects of Assignment. By executing
and delivering an Assignment and Assumption Agreement, the assignor and
assignee thereunder confirm to and agree with each other and the other parties
hereto as follows: (i) other than as provided in such Assignment and Assump-
0104420.05-01S7a
95
tion Agreement, the assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement, the other Transaction Documents or
any other instrument or document furnished pursuant hereto or thereto or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
or this Agreement, the other Transaction Documents or any such other instrument
or document; (ii) the as- ▇▇▇▇▇▇ makes no representation or warranty and assumes
no responsibility with respect to the financial condition of the Transferor, the
Seller or the Collection Agent or the performance or observance by the
Transferor, the Seller or the Collection Agent of any of their respective
obligations under this Agreement, the Receivables Purchase Agreement, the other
Transaction Documents or any other instrument or document furnished pursuant
hereto; (iii) such assignee confirms that it has received a copy of this
Agreement, the Receivables Purchase Agreement and such other instruments,
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Assumption Agreement and
to purchase such interest; (iv) such assignee will, independently and without
reliance upon the Agent, or any of its Affiliates, or the assignor and based on
such agreements, documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement and the other Transaction Documents; (v) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under this Agreement, the other Transaction Documents
and any other instrument or document furnished pursuant hereto or thereto as are
delegated to the Agent by the terms hereof or thereof, together with such powers
as are reasonably incidental thereto and to enforce its respective rights and
interests in and under this Agreement, the other Transaction Documents, the
Receivables, the Contracts and the Related Security; (vi) such assignee agrees
that it will perform in accordance with their terms all of the obligations which
by the terms of this Agreement and the other Transaction Documents are required
to be performed by it as the assignee of the assignor; and (vii) such assignee
agrees that it will not institute against the Company any proceeding of the type
referred to in Section 11.9 prior to the date which is
0104420.05-01S7a
96
one year and one day after the payment in full of all Commercial Paper issued by
the Company.
(d) Transferor's Obligation to Pay Cer-
tain Amounts; Additional Assignment Amount. The Trans- feror shall pay to the
Agent, for the account of the Company, in connection with any assignment by the
Company to the Bank Investors pursuant to this Section 10.7, an aggregate amount
equal to all Discount to accrue through the end of each outstanding Tranche
Period plus all other Aggregate Unpaids (other than the Net Investment). To the
extent that such Discount relates to interest or discount on Related Commercial
Paper, if the Transferor fails to make payment of such amounts at or prior to
the time of assignment by the Company to the Bank Investors, such amount shall
be paid by the Bank Investors (in accordance with their respective Pro Rata
Shares) to the Company as additional consideration for the interests assigned to
the Bank Investors and the amount of the "Net Investment" hereunder held by the
Bank Investors shall be increased by an amount equal to the additional amount so
paid by the Bank Investors.
(e) Administration of Agreement After
Assignment. After any assignment by the Company to the Bank Investors pursuant
to this Section 10.7 (and the payment of all amounts owing to the Company in
connection therewith), all rights of the Administrative Agent and the Collateral
Agent set forth herein shall be deemed to be afforded to the Agent on behalf of
the Bank Investors instead of either such party.
(f) Payments. After any assignment by
the Company to the Bank Investors pursuant to this Section 10.7, all payments to
be made hereunder by the Transferor or the Collection Agent to the Bank
Investors shall be made to the Agent's account as such account shall have been
notified to the Transferor and the Collection Agent.
(g) Downgrade of Bank Investor. If at
any time prior to any assignment by the Company to the Bank Investors as
contemplated pursuant to this Section 10.7, the short term debt rating of any
Bank Investor shall be "A-2" or "P-2" from Standard & Poor's or Moody's,
respectively, with negative credit implications, such Bank Investor, upon
request of the Agent, shall,
0104420.05-01S7a
97
within 30 days of such request, assign its rights and obligations hereunder to
another financial institution (which institution's short term debt shall be
rated at least "A-2" and "P-2" from Standard & Poor's and Moody's, respectively,
and which shall not be so rated with negative credit implications). If the short
term debt rating of a Bank Investor shall be "A-3" or "P-3", or lower, from
Standard & Poor's or Moody's, respectively (or such rating shall have been
withdrawn by Standard & Poor's or Moody's), such Bank Investor, upon request of
the Agent, shall, within five (5) Business Days of such request, assign its
rights and obligations hereunder to another financial institution (which
institution's short term debt shall be rated at least "A-2" and "P-2" from
Standard & Poor's and Moody's, respectively, and which shall not be so rated
with negative credit implications). In either such case, if any such Bank
Investor shall not have assigned its rights and obligations under this Agreement
within the applicable time period described above, the Company shall have the
right to require such Bank Investor to accept the assignment of such Bank
Investor's Pro Rata Share of the Net Investment; such assignment shall occur in
accordance with the applicable provisions of this Section 10.7. Such Bank
Investor shall be obligated to pay to the Company, in connection with such
assignment, in addition to the Pro Rata Share of the Net Investment, an amount
equal to the interest component of the outstanding Commercial Paper issued to
fund the portion of the Net Investment being assigned to such Bank Investor, as
reasonably determined by the Agent. Notwithstanding anything contained herein to
the contrary, upon any such assignment to a downgraded Bank Investor as
contemplated pursuant to the immediately preceding sentence, the aggregate
available amount of the Facility Limit, solely as it relates to new Incremental
Transfers by the Company, shall be reduced by the amount of unused Commitment of
such downgraded Bank Investor; it being understood and agreed, that nothing in
this sentence or the two preceding sentences shall affect or diminish in any way
any such downgraded Bank Investor's Commitment to the Transferor or such
downgraded Bank Investor's other obligations and liabilities hereunder and under
the other Transaction Documents.
0104420.05-01S7a
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ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Term of Agreement. This Agreement shall
terminate on the date following the Termination Date upon which the Net
Investment has been reduced to zero, all accrued Discount and Servicing Fees
have been paid in full, and all other Aggregate Unpaids have been paid in full,
in each case, in cash; provided, however, that (i) the rights and remedies of
the Agent, the Company, the Bank Investors and the Administrative Agent with
respect to any representation and warranty made or deemed to be made by the
Transferor pursuant to this Agreement, (ii) the indemnification and payment
provisions of Article VIII, (iii) Tech Data's obligations under Article IX and
(iv) the agreement set forth in Section 11.8 hereof, shall be continuing and
shall survive any termination of this Agreement.
SECTION 11.2. Waivers; Amendments. No failure or delay on the
part of the Agent, the Company, the Administrative Agent or any Bank Investor in
exercising any power, right or remedy under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other further exercise thereof or the exercise of
any other power, right or remedy. The rights and remedies herein provided shall
be cumulative and nonexclusive of any rights or remedies provided by law. Any
provision of this Agreement may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Transferor, the Company,
the Agent and the Majority Investors.
SECTION 11.3. Notices. Except as provided below, all
communications and notices provided for hereunder shall be in writing (including
bank wire, telex, telecopy or electronic facsimile transmission or similar
writing) and shall be given to the other party at its address or telecopy number
set forth below or at such other address or telecopy number as such party may
hereafter specify for the purposes of notice to such party. Each such notice or
other communication shall be effective (i) if given by telecopy, when such
telecopy is transmitted to the telecopy number specified in this
0104420.05-01S7a
99
Section 11.3 and confirmation is received, (ii) if given by mail 3 Business Days
following such posting, postage prepaid, U.S. certified or registered, (iii) if
given by overnight courier, one (1) Business Day after deposit thereof with a
national overnight courier service, or (iv) if given by any other means, when
received at the address specified in this Section 11.3. However, anything in
this Section 11.3 to the contrary notwithstanding, the Transferor hereby
authorizes the Company to effect Transfers, Tranche Period and Tranche Rate
selections based on telephonic notices made by any Person which the Company in
good faith believes to be acting on behalf of the Transferor. The Transferor
agrees to deliver promptly to the Company a written confirmation of each
telephonic notice signed by an authorized officer of Transferor. However, the
absence of such confirmation shall not affect the validity of such notice. If
the written confirmation differs in any material respect from the action taken
by the Company, the records of the Company shall govern absent manifest error.
If to the Company:
Enterprise Funding Corporation
c/o Merrill ▇▇▇▇▇ Money Markets Inc.
World Financial Center--South Tower
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(with a copy to the Administrative Agent)
If to the Transferor:
Tech Data Finance, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to Tech Data:
Tech Data Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
0104420.05-01S7a
100
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(with a copy to General Counsel)
If to the Agent:
NationsBank, N.A.
NationsBank Corporate ▇▇▇▇▇▇--▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇--
Structured Finance
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Administrative Agent:
NationsBank, N.A.
NationsBank Corporate ▇▇▇▇▇▇--▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇--
Structured Finance
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Bank Investors, at their respective addresses set
forth on the signature pages hereto or of the Assignment and Assumption
Agreement pursuant to which it became a party hereto.
SECTION 11.4. Governing Law; Submission to
Jurisdiction; Integration.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. THE TRANSFEROR HEREBY SUBMITS
TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE
CITY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. The
Transferor hereby irrevocably waives, to the fullest extent it may effectively
do so, any objection which it may now or hereafter have to the laying of the
venue of any such proceeding brought in such a court and any claim that any such
proceeding brought in such a court has been brought in an inconvenient forum.
Nothing in this Sec-
0104420.05-01S7a
101
tion 11.4 shall affect the right of the Company to bring any action or
proceeding against the Transferor or its property in the courts of other
jurisdictions.
(b) This Agreement contains the final and complete integration
of all prior expressions by the parties hereto with respect to the subject
matter hereof and shall constitute the entire Agreement among the parties hereto
with respect to the subject matter hereof superseding all prior oral or written
understandings, including but not limited to the mandate letter dated November
16, 1993.
SECTION 11.5. Severability; 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 when taken together shall constitute one and the same
Agreement. Any provisions of this Agreement which are prohibited or unen-
forceable in any jurisdiction shall, as to such jurisdiction, be ineffective to
the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 11.6. Successors and Assigns.(a)
This Agreement shall be binding on the parties hereto and
their respective successors and assigns; provided, however, that the Transferor
may not assign any of its rights or delegate any of its duties hereunder without
the prior written consent of the Company. No provision of this Agreement shall
in any manner restrict the ability of the Company to assign, participate, grant
security interests in, or otherwise transfer any portion of the Transferred
Interest.
(b) The Transferor hereby agrees and
consents to the assignment by the Company from time to time of all or any part
of its rights under, interest in and title to this Agreement and the Transferred
Interest to any Liquidity Provider. In addition, the Transferor hereby consents
to and acknowledges the assignment by the Company of all of its rights under,
interest in and title
0104420.05-01S7a
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to this Agreement and the Transferred Interest to the
Collateral Agent.
SECTION 11.7. Waiver of Confidentiality. The
Transferor and Tech Data hereby consent to the disclosure of any non-public
information with respect to it received by the Company, the Agent, any Bank
Investor or the Administrative Agent to any of the Company, the Agent, any
nationally recognized rating agency rating the Company's Commercial Paper, the
Administrative Agent, the Collateral Agent, any Bank Investor or potential Bank
Investor, the Liquidity Provider or the Credit Support Provider in relation to
this Agreement.
SECTION 11.8. Confidentiality Agreement. The
Transferor and Tech Data hereby agree that they will not disclose the
contents of this Agreement or any other proprietary or confidential information
of the Company, the Agent, the Administrative Agent, any Bank Investor, the
Collateral Agent, the Liquidity Provider or the Credit Support Provider to any
other Person except (i) its auditors and attorneys, employees or financial advi-
sors (other than any commercial bank) and any nationally recognized rating
agency, provided such auditors, attorneys, employees, financial
advisors or rating agencies are informed of the highly confidential nature of
such information or (ii) as otherwise required by applicable law or order of a
court of competent jurisdiction.
SECTION 11.9. No Bankruptcy Petition Against the Company. The
Transferor and Tech Data each hereby covenant and agree that, prior to the date
which is one year and one day after the payment in full of all outstanding
Commercial Paper or other indebtedness of the Company, it will not institute
against, or join any other Person in instituting against, the Company any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings
or other similar proceeding under the laws of the United States or any state of
the United States.
SECTION 11.10. No Recourse Against Stockholders, Officers or
Directors. No recourse under any obligation, covenant or agreement of the
Company contained in this Agreement shall be had against ▇▇▇▇▇▇▇ ▇▇▇▇▇ Money
Markets Inc. (or any affiliate thereof), or any stockholder, officer or director
of the Company, as such, by
0104420.05-01S7a
103
the enforcement of any assessment or by any legal or equitable proceeding, by
virtue of any statute or otherwise; it being expressly agreed and understood
that this Agreement is solely a corporate obligation of the Company, and that no
personal liability whatsoever shall attach to or be incurred by ▇▇▇▇▇▇▇ ▇▇▇▇▇
Money Markets Inc. (or any affiliate thereof), or the stockholders, officers or
directors of the buyer, as such, or any of them, under or by reason of any of
the obligations, covenants or agreements of the Company contained in this
Agreement, or implied therefrom, and that any and all personal liability for
breaches by the Company of any of such obligations, covenants or agreements,
either at common law or at equity, or by statute or constitution, of ▇▇▇▇▇▇▇
▇▇▇▇▇ Money Markets Inc. (or any affiliate thereof) and every such stockholder,
officer or director of the Company is hereby expressly waived as a condition of
and consideration for the execution of this Agreement.
SECTION 11.11. Characterization of the Transactions
Contemplated by the Agreement. It is the intention of the parties that the
transactions contemplated hereby constitute the sale of the Transferred
Interest, conveying good title thereto free and clear of any Adverse Claims to
the Agent, on behalf of the Company and the Bank Investors, and that the
Transferred Interest not be part of the Transferor's estate in the event of an
insolvency. If, notwithstanding the foregoing, the transactions contemplated
hereby should be deemed a financing, the parties intend that the Transferor
shall be deemed to have granted to the Agent, on behalf of the Company and the
Bank Investors, and the Transferor hereby grants to the Agent, on behalf of the
Company and the Bank Investors, a first priority perfected security interest in
all of the Transferor's right, title and interest in, to and under the
Receivables, together with Related Security and Collections with respect
thereto, and that this Agreement shall constitute a security agreement under
applicable law.
SECTION 11.12. Optional Reconveyance of All Receivables. The
Transferor shall have the option at any time to require the Agent, on behalf of
the Company and the Bank Investors, to reconvey all of it's interest in the
Receivables to the Transferor subject to the following terms and conditions: (a)
the Transferor shall give the Agent not less than 10 Business Days notice of the
0104420.05-01S7a
104
Transferor's exercise of this option and (b) simultaneously with the
reconveyance by the Agent to the Trans- feror of the Agent's interest in the
Receivables, the Transferor shall pay to the Agent, for the benefit of the
Company and the Bank Investors, an amount equal to the Net Investment plus all
discount accrued and to accrue on the Company's Related Commercial Paper to
maturity, together with any other costs associated with the receipt by the
Company of the Net Investment on a day other than the last day of a Tranche
Period, along with any other amounts owing hereunder to the Company or the Bank
Investors by the Transferor.
SECTION 11.13. Mandatory Reconveyance of Certain Receivables.
The Agent, on behalf of the Company and the Bank Investors, upon each occasion
on which the Transferor shall be required to reconvey any Receivables to Tech
Data pursuant to Section 7.2(a) of the Purchase Agreement, shall be considered
to have reconveyed and does hereby reconvey to the Transferor such Receivables
(including the Transferred Interest therein) and upon such reconveyance, hereby
terminates its interest in any such Receivables; provided that no such
reconveyance by the Agent shall occur or be deemed to have occurred if (a) any
Event of Termination shall have occurred and be continuing hereunder or (b) Tech
Data shall not have contemporaneously with such reconveyance sold to the
Transferor a substitute receivable as described in Section 7.2(b) of the
Purchase Agreement.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
0104420.05-01S7a
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Amended and Restated Transfer and Administration Agreement as of
the day first written above.
ENTERPRISE FUNDING CORPORATION,
as Company
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
TECH DATA FINANCE, INC.,
as Transferor
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Treasurer
TECH DATA CORPORATION,
as Collection Agent and
Guarantor
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Treasurer
NATIONSBANK, N.A., as Agent
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Investment Banking Officer
▇▇▇▇▇▇▇.05-01S7a
106
Commitment NATIONSBANK, N.A., as
$306,000,000.00 Bank Investor
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Investment Banking Officer
▇▇▇▇▇▇▇.05-01S7a
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