1
Exhibit 10.14
================================================================================
CREDIT AND SECURITY AGREEMENT
DATED AS OF JULY 1, 1999
AMONG
INTERIM SERVICES RECEIVABLES CORP., AS BORROWER,
INTERIM SERVICES, INC., AS INITIAL SERVICER,
EACH THE LENDERS FROM TIME TO TIME PARTY HERETO,
THE FIRST NATIONAL BANK OF CHICAGO, AS FALCON AGENT
AND
WACHOVIA BANK, N.A.,
AS BLUE RIDGE AGENT AND COLLATERAL AGENT
================================================================================
2
TABLE OF CONTENTS
PAGE
ARTICLE I. THE CREDIT.............................................................................................2
SECTION 1.1 THE FACILITY....................................................................................2
SECTION 1.2 RATABLE LOANS; FUNDING MECHANICS; LIQUIDITY FUNDINGS............................................3
SECTION 1.3 INTEREST RATES..................................................................................3
SECTION 1.4 PAYMENT DATES; NOTELESS AGREEMENT...............................................................4
SECTION 1.5 PREPAYMENTS.....................................................................................5
SECTION 1.6 REDUCTIONS IN AGGREGATE COMMITMENT..............................................................5
SECTION 1.7 REQUESTS FOR INCREASES IN AGGREGATE COMMITMENT..................................................6
SECTION 1.8 EXTENSION OF THE SCHEDULED TERMINATION DATE.....................................................6
SECTION 1.9 DISTRIBUTION OF CERTAIN NOTICES; NOTIFICATION OF INTEREST RATES.................................7
ARTICLE II. BORROWING AND PAYMENT MECHANICS; CERTAIN COMPUTATIONS.................................................7
SECTION 2.1 METHOD OF BORROWING.............................................................................7
SECTION 2.2 SELECTION OF CP TRANCHE PERIODS AND INTEREST PERIODS............................................7
SECTION 2.3 COMPUTATION OF CONCENTRATION LIMITS AND UNPAID BALANCE..........................................8
SECTION 2.4 MAXIMUM INTEREST RATE...........................................................................8
SECTION 2.5 PAYMENTS AND COMPUTATIONS, ETC..................................................................8
(a) PAYMENTS..............................................................................................8
(b) LATE PAYMENTS.........................................................................................9
(c) METHOD OF COMPUTATION.................................................................................9
(d) AVOIDANCE OR RECISSION OF PAYMENTS....................................................................9
SECTION 2.6 NON-RECEIPT OF FUNDS BY THE CO-AGENTS...........................................................9
ARTICLE III. SETTLEMENTS..........................................................................................9
SECTION 3.1 REPORTING.......................................................................................9
(a) INFORMATION PACKAGES..................................................................................9
(b) INTEREST; OTHER AMOUNTS DUE...........................................................................9
SECTION 3.2 TURNOVER OF COLLECTIONS........................................................................10
i
3
SECTION 3.3 NON-DISTRIBUTION OF SERVICER'S FEE.............................................................11
SECTION 3.4 DEEMED COLLECTIONS.............................................................................11
ARTICLE IV. FEES AND YIELD PROTECTION............................................................................12
SECTION 4.1 FEES...........................................................................................12
SECTION 4.2 YIELD PROTECTION...............................................................................12
SECTION 4.3 FUNDING LOSSES.................................................................................14
ARTICLE V. CONDITIONS OF ADVANCES................................................................................15
SECTION 5.1 CONDITIONS PRECEDENT TO INITIAL ADVANCE........................................................15
SECTION 5.2 CONDITIONS PRECEDENT TO ALL ADVANCES...........................................................17
ARTICLE VI. REPRESENTATIONS AND WARRANTIES.......................................................................17
SECTION 6.1 REPRESENTATIONS AND WARRANTIES OF LOAN PARTIES.................................................17
(a) DUE INCORPORATION AND GOOD STANDING; OWNERSHIP OF THE BORROWER.......................................17
(b) DUE QUALIFICATION....................................................................................17
(c) POWER AND AUTHORITY; DUE AUTHORIZATION...............................................................18
(d) TITLE TO RECEIVABLES; VALID SECURITY INTEREST........................................................18
(e) NONCONTRAVENTION.....................................................................................18
(f) NO PROCEEDINGS.......................................................................................18
(g) ENFORCEABILITY.......................................................................................19
(h) GOVERNMENT APPROVALS.................................................................................19
(i) FINANCIAL STATEMENTS AND ABSENCE OF CERTAIN MATERIAL ADVERSE CHANGES.................................19
(j) NATURE OF RECEIVABLES................................................................................20
(k) MARGIN REGULATIONS...................................................................................20
(l) QUALITY OF TITLE.....................................................................................20
(m) ACCURATE REPORTS.....................................................................................20
(n) OFFICES..............................................................................................20
(o) LOCK-BOX ACCOUNTS....................................................................................20
(p) ELIGIBLE RECEIVABLES.................................................................................21
(q) YEAR 2000 READINESS..................................................................................21
(r) NAMES................................................................................................21
(s) CREDIT AND COLLECTION POLICY.........................................................................21
(t) PAYMENTS TO ORIGINATOR...............................................................................21
(u) NOT AN INVESTMENT COMPANY............................................................................21
(v) BORROWING BASE.......................................................................................21
ARTICLE VII. GENERAL COVENANTS OF LOAN PARTIES...................................................................21
SECTION 7.1 AFFIRMATIVE COVENANTS OF LOAN PARTIES..........................................................21
(a) COMPLIANCE WITH LAWS, ETC............................................................................21
(b) PRESERVATION OF CORPORATE EXISTENCE..................................................................22
(c) AUDITS...............................................................................................22
(d) KEEPING OF RECORDS AND BOOKS OF ACCOUNT..............................................................22
(e) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS AND/OR INVOICES............................23
ii
4
(f) LOCATION OF RECORDS..................................................................................23
(g) CREDIT AND COLLECTION POLICIES.......................................................................23
(h) SALE AGREEMENT.......................................................................................23
(i) COLLECTIONS..........................................................................................23
(j) FURTHER ASSURANCES...................................................................................23
SECTION 7.2 REPORTING REQUIREMENTS OF LOAN PARTIES.........................................................23
(a) QUARTERLY FINANCIAL STATEMENTS.......................................................................24
(b) ANNUAL FINANCIAL STATEMENTS..........................................................................24
(c) REPORTS TO SEC AND EXCHANGES.........................................................................24
(d) ERISA................................................................................................24
(e) EVENTS OF DEFAULT, ETC...............................................................................24
(f) LITIGATION...........................................................................................24
(g) REVIEWS OF RECEIVABLES...............................................................................24
(h) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY...................................................24
(i) ACCOUNTING PERIODS...................................................................................25
(j) OTHER................................................................................................25
SECTION 7.3 NEGATIVE COVENANTS OF LOAN PARTIES.............................................................25
(a) SALES, LIENS, ETC....................................................................................25
(b) EXTENSION OR AMENDMENT OF RECEIVABLES................................................................25
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY...................................................25
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS...........................................................25
(e) DEPOSITS TO LOCK-BOX ACCOUNTS AND COLLECTION ACCOUNT.................................................26
(f) CHANGES TO OTHER DOCUMENTS...........................................................................26
(g) RESTRICTED PAYMENTS BY THE BORROWER..................................................................26
(h) BORROWER INDEBTEDNESS................................................................................26
(i) PROHIBITION ON ADDITIONAL NEGATIVE PLEDGES...........................................................26
(j) NAME CHANGE, OFFICES, RECORDS AND BOOKS OF ACCOUNTS..................................................27
(k) MERGERS, CONSOLIDATIONS AND ACQUISITIONS.............................................................27
(l) DISPOSITION OF RECEIVABLES AND RELATED ASSETS........................................................27
(m) BORROWING BASE.......................................................................................27
SECTION 7.4 SEPARATE CORPORATE EXISTENCE OF THE BORROWER...................................................27
ARTICLE VIII. ADMINISTRATION AND COLLECTION......................................................................30
SECTION 8.1 DESIGNATION OF SERVICER........................................................................30
(a) INTERIM SERVICES AS INITIAL SERVICER.................................................................30
(b) SUCCESSOR NOTICE; SERVICER TRANSFER EVENTS...........................................................30
(c) SUBCONTRACTS.........................................................................................30
(d) EXPENSE INDEMNITY AFTER A SERVICER TRANSFER EVENT....................................................31
SECTION 8.2 DUTIES OF SERVICER.............................................................................31
(a) APPOINTMENT; DUTIES IN GENERAL.......................................................................31
(b) SEGREGATION OF COLLECTIONS...........................................................................31
(c) MODIFICATION OF RECEIVABLES..........................................................................31
(d) DOCUMENTS AND RECORDS................................................................................31
(e) CERTAIN DUTIES TO THE BORROWER.......................................................................31
(f) TERMINATION..........................................................................................32
(g) POWER OF ATTORNEY....................................................................................32
SECTION 8.3 RIGHTS OF THE COLLATERAL AGENT.................................................................32
(a) NOTICE TO OBLIGORS...................................................................................32
iii
5
(b) NOTICE TO LOCK-BOX BANKS.............................................................................32
(c) RIGHTS ON SERVICER TRANSFER EVENT....................................................................32
SECTION 8.4 RESPONSIBILITIES OF LOAN PARTIES...............................................................33
(a) CONTRACTS............................................................................................33
(b) LIMITATION OF LIABILITY..............................................................................33
SECTION 8.5 FURTHER ACTION EVIDENCING THE SECURITY INTEREST................................................33
(a) FURTHER ASSURANCES...................................................................................33
(b) ADDITIONAL FINANCING STATEMENTS; CONTINUATION STATEMENTS; PERFORMANCE BY COLLATERAL AGENT............34
SECTION 8.6 APPLICATION OF COLLECTIONS.....................................................................34
ARTICLE IX. SECURITY INTEREST....................................................................................34
SECTION 9.1 GRANT OF SECURITY INTEREST.....................................................................34
SECTION 9.2 REMEDIES.......................................................................................35
SECTION 9.3 TERMINATION AFTER FINAL PAYOUT DATE............................................................35
SECTION 9.4 LIMITATION ON RIGHTS TO COLLATERAL PROCEEDS....................................................35
ARTICLE X. EVENTS OF DEFAULT.....................................................................................35
SECTION 10.1 EVENTS OF DEFAULT..............................................................................35
SECTION 10.2 REMEDIES.......................................................................................38
(a) OPTIONAL ACCELERATION................................................................................38
(b) AUTOMATIC ACCELERATIon...............................................................................38
(c) ADDITIONAL REMEDIES..................................................................................38
ARTICLE XI. THE AGENTS...........................................................................................38
SECTION 11.1 APPOINTMENT....................................................................................38
SECTION 11.2 DELEGATION OF DUTIES...........................................................................39
SECTION 11.3 EXCULPATORY PROVISIONS.........................................................................39
SECTION 11.4 RELIANCE BY AGENTS.............................................................................40
SECTION 11.5 NOTICE OF EVENTS OF DEFAULT....................................................................41
SECTION 11.6 NON-RELIANCE ON AGENTS AND OTHER LENDERS.......................................................41
SECTION 11.7 INDEMNIFICATION OF AGENTS......................................................................42
SECTION 11.8 AGENTS IN THEIR INDIVIDUAL CAPACITIES..........................................................42
SECTION 11.9 SUCCESSOR COLLATERAL AGENT.....................................................................42
iv
6
SECTION 11.10 AGENTS'CONFLICT WAIVERS.....................................................................43
SECTION 11.11 UCC FILINGS.................................................................................44
ARTICLE XII. ASSIGNMENTS AND PARTICIPATIONS......................................................................44
SECTION 12.1 RESTRICTIONS ON ASSIGNMENTS, ETC...............................................................44
SECTION 12.2 RIGHTS OF ASSIGNEES AND PARTICIPANTS...........................................................45
SECTION 12.3 TERMS AND EVIDENCE OF ASSIGNMENT...............................................................46
ARTICLE XIII. INDEMNIFICATION....................................................................................46
SECTION 13.1 INDEMNITIES BY THE BORROWER....................................................................46
(a) GENERAL INDEMNITY....................................................................................46
(b) CONTEST OF TAX CLAIM; AFTER-TAX BASIS................................................................48
(c) CONTRIBUTION.........................................................................................49
SECTION 13.2 INDEMNITIES BY SERVICER........................................................................49
ARTICLE XIV. MISCELLANEOUS.......................................................................................50
SECTION 14.1 AMENDMENTS, ETC................................................................................50
SECTION 14.2 NOTICES, ETC...................................................................................50
SECTION 14.3 NO WAIVER; REMEDIES............................................................................50
SECTION 14.4 BINDING EFFECT; SURVIVAL.......................................................................50
SECTION 14.5 COSTS, EXPENSES AND TAXES......................................................................51
SECTION 14.6 NO PROCEEDINGS.................................................................................51
SECTION 14.7 CONFIDENTIALITY OF BORROWER INFORMATION........................................................51
(a) CONFIDENTIAL BORROWER INFORMATION....................................................................52
(b) DISCLOSURE...........................................................................................52
(c) LEGAL COMPULSION.....................................................................................53
(d) SURVIVAL.............................................................................................53
SECTION 14.8 CONFIDENTIALITY OF PROGRAM INFORMATION.........................................................54
(a) CONFIDENTIAL INFORMATION.............................................................................54
(b) AVAILABILITY OF CONFIDENTIAL INFORMATION.............................................................54
(c) LEGAL COMPULSION TO DISCLOSE.........................................................................54
(d) SURVIVAL.............................................................................................55
SECTION 14.9 CAPTIONS AND CROSS REFERENCES..................................................................55
SECTION 14.10 INTEGRATION.................................................................................55
SECTION 14.11 GOVERNING LAW...............................................................................55
v
7
SECTION 14.12 WAIVER OF JURY TRIAL........................................................................56
SECTION 14.13 CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES...............................................56
SECTION 14.14 EXECUTION IN COUNTERPARTS...................................................................56
SECTION 14.15 NO RECOURSE AGAINST OTHER PARTIES...........................................................56
vi
8
CREDIT AND SECURITY AGREEMENT
THIS CREDIT AND SECURITY AGREEMENT is entered into as of
July 1, 1999, by and among:
(1) INTERIM SERVICES RECEIVABLES CORP., a Delaware corporation
(together with its successors and permitted assigns, the "BORROWER"),
(2) INTERIM SERVICES INC., a Delaware corporation (together
with its successors, "INTERIM SERVICES"), as initial servicer hereunder
(in such capacity, together with any successor servicer or sub-servicer
appointed pursuant to SECTION 8.1, the "SERVICER"),
(3) BLUE RIDGE ASSET FUNDING CORPORATION, a Delaware
corporation (together with its successors, "BLUE RIDGE"), FALCON ASSET
SECURITIZATION CORPORATION, a Delaware corporation (together with its
successors, "FALCON" and, together with Blue Ridge, the "CONDUITS"),
WACHOVIA BANK, N.A., a national banking association, in its capacity as
a Liquidity Bank to Blue Ridge (together with its successors,
"WACHOVIA"), and THE FIRST NATIONAL BANK OF CHICAGO, a national banking
association, in its capacity as a Liquidity Bank to Falcon (together
with its successors, "FIRST CHICAGO"), as Lenders (hereinafter
defined),
(4) WACHOVIA BANK, N.A., as administrative and liquidity agent
for Blue Ridge and its Liquidity Banks (in such capacity, the "BLUE
RIDGE AGENT"), and THE FIRST NATIONAL BANK OF CHICAGO, as
administrative and liquidity agent for Falcon and its Liquidity Banks
(in such capacity, the "FALCON AGENT" and, together with the Blue Ridge
Agent, the "CO-AGENTS"), and
(5) WACHOVIA BANK, N.A., as collateral agent for the Agents
and the Lenders (in such capacity, together with any successors thereto
in such capacity, the "COLLATERAL AGENT").
UNLESS OTHERWISE INDICATED, CAPITALIZED TERMS USED IN THIS AGREEMENT ARE DEFINED
IN ANNEX A.
W I T N E S S E T H :
WHEREAS, the Borrower is a wholly-owned direct subsidiary of
INTERIM SERVICES;
WHEREAS, INTERIM SERVICES is engaged primarily in the business
of providing professionals in the fields of information technology,
finance, law, manufacturing and human resources, as well as clerical,
administrative and light industrial staffing through its four main
operating segments -- consulting, managed services, search/recruitment
and flexible staffing;
9
WHEREAS, INTERIM SERVICES and certain of its Subsidiaries as
Originators and the Borrower have entered into the Sale Agreement
pursuant to which each of the Originators has sold, and hereafter will
sell, to the Borrower all of its right, title and interest in and to
its accounts receivable and certain related rights;
WHEREAS, the Borrower has requested that the Lenders make
revolving loans to the Borrower from time to time hereafter secured by
the Collateral, and, subject to the terms and conditions contained in
this Agreement, the Lenders are willing to make such secured loans;
WHEREAS, the Lenders have requested that INTERIM SERVICES act
as the initial Servicer for the Collateral, and, subject to the terms
and conditions contained in this Agreement, INTERIM SERVICES is willing
to act in such capacity; and
WHEREAS, Wachovia has been requested, and is willing, to act
as the Collateral Agent under this Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereto hereby agree as follows:
ARTICLE I.
THE CREDIT
Section 1.1 THE FACILITY. On the terms and subject to the
conditions set forth in this Agreement, the Borrower (or the Servicer on the
Borrower's behalf) may from time to time during the Revolving Period request
Advances by delivering a Borrowing Request to the Co-Agents in accordance with
SECTION 2.1. Upon receipt of a copy of each Borrowing Request from the Borrower
or Servicer, each of the Co-Agents shall advise the Borrower not later than
12:00 noon (New York City time) on the Business Day following such receipt
whether its Conduit or such Conduit's Liquidity Banks will fund a Loan in an
amount equal to its Percentage of the requested Advance, and:
(a) in the event that Blue Ridge elects not to make any such
Loan to the Borrower, each of the Liquidity Banks of Blue Ridge severally agrees
to make its Ratable Share of such Loan to the Borrower, on the terms and subject
to the conditions hereof, PROVIDED THAT at no time may the aggregate principal
amount of Blue Ridge's and its Liquidity Banks' Loans at any one time
outstanding exceed the lesser of (i) the aggregate amount of the Blue Ridge
Liquidity Banks' Commitments, and (ii) Blue Ridge's Percentage of the Borrowing
Base (such lesser amount, the "BLUE RIDGE ALLOCATION LIMIT"); and
(b) in the event that Falcon elects not to make any such Loan
to the Borrower, each of the Liquidity Banks of Falcon severally agrees to make
its Ratable Share of such Loan to the Borrower, on the terms and subject to the
conditions hereof, PROVIDED THAT at no time may the aggregate principal amount
of Falcon's and its Liquidity Banks' Loans at any one time outstanding exceed
the lesser of (i) the aggregate amount of the Falcon Liquidity Banks'
2
10
Commitments, and (ii) Falcon's Percentage of the Borrowing Base (such lesser
amount, the "FALCON ALLOCATION LIMIT").
Each Loan shall be in the minimum amount of $1,000,000 or a larger integral
multiple of $500,000. In no event may the aggregate principal amount of the
Advances hereunder exceed the lesser of (x) the Aggregate Commitment, or (y) the
Borrowing Base. All Liquidity Banks' Commitments shall terminate on the
Termination Date. Each of the Loans, and all other Obligations of the Borrower,
shall be secured by the Collateral as provided in Article IX.
Section 1.2 RATABLE LOANS; FUNDING MECHANICS; LIQUIDITY
FUNDINGS.
(a) Each Advance hereunder shall consist of Loans made from
Falcon and/or its Liquidity Banks, on the one hand, and Blue Ridge and/or its
Liquidity Banks, on the other hand, ratably in proportion to their respective
Percentages.
(b) Each Lender funding any Loan (or portion thereof) shall
initiate a wire transfer in the principal amount of its Loan on the applicable
Borrowing Date to its applicable Co-Agent in immediately available funds not
later than 10:00 a.m. (New York City time) on the applicable Borrowing Date and,
subject to its receipt of such Loan proceeds, such Co-Agent shall initiate a
wire transfer of such funds to the account specified by the Borrower in its
Borrowing Request not later than 11:00 a.m. (New York City time) on such
Borrowing Date.
(c) While it is the intent of the Conduits to fund their
respective Percentages of each requested Advance through the issuance of
Commercial Paper Notes, the parties acknowledge that if either of the Conduits
is unable, or determines that it is undesirable, to issue Commercial Paper Notes
to fund all or any portion its Loans at a CP Rate, or is unable to repay such
Commercial Paper Notes upon the maturity thereof, such Conduit may put all or
any portion of its Loans to its Liquidity Banks at any time pursuant to its
Liquidity Agreement to finance or refinance the necessary portion of its Loans
through a Liquidity Funding to the extent available. The Liquidity Fundings may
be Alternate Base Rate Loans or Eurodollar Loans, or a combination thereof,
selected by the Borrower in accordance with Article II. In addition, the parties
acknowledge that Commercial Paper Notes are issued at a discount and at varying
discount rates; accordingly, it may not be possible for all CP Rate Loans to be
made in amounts precisely equal to the amounts specified in a Borrowing Request.
Regardless of whether a Liquidity Funding constitutes an assignment of a Loan or
the sale of one or more participations therein, each Liquidity Bank
participating in a Liquidity Funding shall have the rights of a "Lender"
hereunder with the same force and effect as if it had directly made a Loan to
the Borrower in the amount of its Liquidity Funding.
(d) Nothing herein shall be deemed to commit any Lender to
make CP Rate Loans.
Section 1.3 INTEREST RATES.
(a) Each CP Rate Loan shall bear interest on the outstanding
principal amount thereof from and including the first day of the CP Tranche
Period applicable thereto selected in
3
11
accordance with Article II of this Agreement to (but not including) the last day
of such CP Tranche Period at the applicable CP Rate.
(b) Each Eurodollar Loan shall bear interest on the
outstanding principal amount thereof from and including the first day of the
Interest Period applicable thereto selected in accordance with Article II of
this Agreement to (but not including) the last day of such Interest Period at a
rate per annum equal to the sum of (i) the applicable Eurodollar Rate (Reserve
Adjusted) for such Interest Period plus (ii) 0.60% per annum.
(c) Each Alternate Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from and including the date
such Loan is made to but excluding the date it is paid at a rate per annum equal
to the Alternate Base Rate for such day. Changes in the rate of interest on
Alternate Base Rate Loans will take effect simultaneously with each change in
the Alternate Base Rate.
(d) Notwithstanding anything to the contrary contained in
SECTIONS 1.3(a), (b) or (c), upon the occurrence of an Event of Default, and
during the continuance thereof, all Obligations shall bear interest, payable
upon demand, at the Default Rate.
(e) Interest at any of the aforementioned rates shall be
calculated for actual days elapsed on the basis of a 360-day year. Interest
shall be payable for the day a Loan is made but not for the day of any payment
on the amount paid if payment is received prior to noon (local time) at the
place of payment. If any payment of principal of or interest on a Loan shall
become due on a day which is not a Business Day, such payment shall be made on
the next succeeding Business Day and, in the case of a principal payment, such
extension of time shall be included in computing interest in connection with
such payment.
Section 1.4 PAYMENT DATES; NOTELESS AGREEMENT.
(a) The Borrower promises to pay each CP Rate Loan on the last
day of its CP Tranche Period.
(b) The Borrower promises to pay each Eurodollar Loan on the
last day of its Interest Period.
(c) The Borrower promises to pay each Alternate Base Rate
Loan, together with all accrued and unpaid interest thereon, on or before the
earlier to occur of (i) the Termination Date, and (ii) refinancing of such Loan
with a CP Rate Loan or a Eurodollar Rate Loan.
(d) The Borrower promises to pay all accrued and unpaid
interest on each Loan on its applicable Interest Payment Date.
(e) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender resulting from each Loan made by such Lender from time to time,
including the amounts of principal and interest payable and paid to such Lender
from time to time hereunder. Upon request of its Co-Agent or the Collateral
Agent, such Lender will confirm the outstanding principal balances of its
4
12
Loans and the amount of any accrued and unpaid interest thereon. The entries
maintained in the accounts maintained pursuant to this Section shall be PRIMA
FACIE evidence of the existence and amounts of the Obligations therein recorded;
PROVIDED, HOWEVER, that the failure of any Lender to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Obligations in accordance with their terms.
Section 1.5 PREPAYMENTS. Subject, in the case of CP Rate Loans
and Eurodollar Loans, to the funding indemnification provisions of Section 4.3:
(a) The Borrower may from time to time prepay, without penalty
or premium, all outstanding Loans, or, in a minimum aggregate amount of
$2,000,000 (or a larger integral multiple of $1,000,000), any portion of the
outstanding Loans upon two Business Days' prior written notice to the Co-Agents
(each, a "PREPAYMENT NOTICE"), PROVIDED THAT each such prepayment of principal
is accompanied by a payment of all accrued and unpaid interest thereon and is
made ratably amongst the Lenders;
(b) If on any Business Day, the aggregate outstanding
principal amount of Blue Ridge's Loans and the Liquidity Fundings made by Blue
Ridge's Liquidity Banks exceeds the Blue Ridge Allocation Limit, the Borrower
shall prepay such Loans, without premium or penalty, by initiating a wire
transfer to the Blue Ridge Co-Agent not later than 11:00 a.m. (New York City
time) on the second Business Day thereafter in an amount sufficient to eliminate
such excess, together with accrued and unpaid interest on the amount prepaid;
(c) If on any Business Day, the aggregate outstanding
principal amount of Falcon's Loans and the Liquidity Fundings made by Falcon's
Liquidity Banks exceeds the Falcon Allocation Limit, the Borrower shall prepay
such Loans, without premium or penalty, by initiating a wire transfer to the
Falcon Co-Agent not later than 11:00 a.m. (New York City time) on the second
Business Day thereafter in an amount sufficient to eliminate such excess,
together with accrued and unpaid interest on the amount prepaid; and
(d) Upon receipt of any wire transfer pursuant to SECTION
1.5(b) or (c), the applicable Co-Agent shall initiate a wire transfer to each of
its constituent Lenders of their respective shares thereof not later than 11:00
a.m. (New York City time) on the date when received.
Section 1.6 REDUCTIONS IN AGGREGATE COMMITMENT. The Borrower
may permanently reduce the Aggregate Commitment in whole, or ratably in part, in
a minimum amount of $10,000,000 (or a larger integral multiple of $1,000,000),
upon at least five Business Days' written notice to the Co-Agents (each, a
"COMMITMENT REDUCTION NOTICE"), which notice shall specify the aggregate amount
of any such reduction and the Blue Ridge Liquidity Banks' and Falcon Liquidity
Banks' respective Percentages thereof, PROVIDED, HOWEVER, that (a) the amount of
the Aggregate Commitment may not be reduced below the aggregate principal amount
of the outstanding Advances, and (b) the amount of the Aggregate Commitment may
not be reduced below $50,000,000 unless the Aggregate Commitment is terminated
in full. All accrued and unpaid fees shall be payable on the effective date of
any termination of the Aggregate
5
13
Commitment. Each Commitment Reduction Notice shall be irrevocable once delivered
to the Co-Agents.
Section 1.7 REQUESTS FOR INCREASES IN AGGREGATE COMMITMENT.
The Borrower may from time to time request increases in the Aggregate Commitment
in a minimum amount of $10,000,000 (or a larger integral multiple of
$1,000,000), upon at least 30 days' prior written notice to the Co-Agents, which
notice shall specify the amount of and proposed effective date for any such
requested increase (each, a "COMMITMENT INCREASE REQUEST"). If both Co-Agents
agree to the requested increase by notifying the Borrower in writing of their
concurrence, such increase shall be made to the Commitments of the Blue Ridge
Liquidity Banks and the Falcon Liquidity Banks, ratably in accordance with their
respective Percentages and Ratable Shares as of the effective date specified in
the Commitment Increase Request. If either Co-Agent declines such request, the
other Co-Agent may elect to increase the Commitments of its constituent
Liquidity Banks by all or any portion of the entire amount requested, in which
case the Percentages shall be adjusted to reflect such increase on the effective
date specified in the Commitment Increase Request. If neither Co-Agent agrees to
such increase, the amount of the Aggregate Commitment shall remain unchanged.
Section 1.8 EXTENSION OF THE SCHEDULED TERMINATION DATE.
Provided that no Event of Default exists and is continuing, the Borrower may
request an extension of the Scheduled Termination Date by submitting a request
for an extension (each, an "EXTENSION REQUEST") to the Co-Agents no more than 60
days prior to the Scheduled Termination Date then in effect. The Extension
Request must specify the new Scheduled Termination Date requested by the
Borrower and the date (which must be at least 30 days after the Extension
Request is delivered to the Co-Agents) as of which the Co-Agents and their
respective constituents must respond to the Extension Request (the "RESPONSE
DATE"). The new Scheduled Termination Date shall be no more than 364 days after
the Scheduled Termination Date in effect at the time the Extension Request is
received, including the Scheduled Termination Date as one of the days in the
calculation of the days elapsed. Promptly upon receipt of an Extension Request,
the Blue Ridge Agent shall notify Blue Ridge and its Liquidity Banks of the
contents thereof and shall request each such Person to approve the Extension
Request, and the Falcon Agent shall notify Falcon and its Liquidity Banks of the
contents thereof and shall request each such Person to approve the Extension
Request. Each Lender and Liquidity Bank approving the Extension Request shall
deliver its written approval to its Co-Agent no later than the Response Date,
whereupon such Co-Agent shall notify the other Co-Agent and the Borrower within
one Business Day thereafter as to whether all of such Co-Agent's constituents
have approved the Extension Request. If all of the Blue Ridge Agent's
constituents and all of the Falcon Agent's constituents have approved the
Extension Request, the Scheduled Termination Date specified in the Extension
Request shall become effective on the existing Scheduled Termination Date, and
each of the Co-Agents shall promptly notify the Borrower and the other Co-Agent
of the new Scheduled Termination Date. If either Co-Agent's constituents do not
unanimously agree to an Extension Request, the Borrower shall have the right to
require such constituents to assign all, but not less than all, of their
Commitment (as applicable) and outstanding Obligations by entering into written
assignments with one or more Eligible Assignees not later than the 5th Business
Day prior to the existing Scheduled Termination Date. Each such assignment to an
Eligible Assignee (including, if agreed by the other Co-Agent's constituents, to
such
6
14
constituents) shall become effective on such existing Scheduled Termination Date
and, subject to receipt of payment in full on such existing Scheduled
Termination Date for all such Obligations, the non-extending Lenders shall make
such assignments; PROVIDED THAT any expenses or other amounts which would be
owing to such Lender pursuant to any indemnification provision hereof shall be
payable by the Borrower as if the Borrower had prepaid the Loans of the
assigning Lenders rather than such assigning Lenders having assigned their
respective interests hereunder.
Section 1.9 DISTRIBUTION OF CERTAIN NOTICES; NOTIFICATION OF
INTEREST RATES. Promptly after receipt thereof, the Blue Ridge Agent will notify
Blue Ridge and its Liquidity Banks, and the Falcon Agent will notify Falcon and
its Liquidity Banks of the contents of each Information Package, Borrowing
Request, Extension Request, Commitment Reduction Notice, Prepayment Notice,
Commitment Increase Request or notice of default received by it from the
Borrower or the Servicer hereunder. In addition, each of the Co-Agents shall
promptly notify its constituent Lenders and the Borrower of each determination
of and change in Interest Rates.
ARTICLE II.
BORROWING AND PAYMENT MECHANICS; CERTAIN COMPUTATIONS
Section 2.1 METHOD OF BORROWING. The Borrower (or the Servicer
on the Borrower's behalf) shall give the Co-Agents irrevocable notice in the
form of EXHIBIT 2.1 hereto (each, a "BORROWING REQUEST") not later than 12:00
noon (New York City time) at least two Business Days before the Borrowing Date
of each Advance. On each Borrowing Date, each Lender shall make available its
Loan or Loans in immediately available funds to its Co-Agent by initiating a
wire transfer in such amount not later than 10:00 a.m. (New York City time).
Subject to its receipt of such wire transfers, each Co-Agent will initiate a
wire transfer of the funds so received from the Lenders to the Borrower at the
account specified in its Borrowing Request not later than 11:00 a.m. (New York
City time) on the applicable Borrowing Date. Neither the Borrower, nor the
Servicer on the Borrower's behalf, may deliver more than 1 Borrowing Request in
any week of this Agreement (except that the Borrower, or the Servicer on the
Borrower's behalf, may deliver up to 2 Borrowing Requests in the week in which
INTERIM SERVICES' acquisition of ▇▇▇▇▇▇▇ Corporation and/or its Subsidiaries is
consummated).
Section 2.2 SELECTION OF CP TRANCHE PERIODS AND INTEREST
PERIODS.
Prior to the occurrence of an Event of Default, the Borrower
or the Servicer in its Borrowing Request may request CP Tranche Periods
(or, in the case of Liquidity Fundings, Interest Periods) from time to
time to apply to each Lender's CP Rate Loans or Eurodollar Loans, as
applicable; PROVIDED, HOWEVER, that (i) at least one CP Tranche Period
or one Interest Period shall mature on each Settlement Date, and (ii)
no CP Tranche Period or Interest Period which began prior to the
Scheduled Termination Date shall extend beyond the Scheduled
Termination Date.
While each of the Co-Agents will use reasonable efforts to
accommodate the Borrower's or the Servicer's requests for CP Tranche
Periods or Interest Periods prior to an Event of Default, each of the
Co-Agents shall have the right to subdivide any requested Loan into one
or more Loans of different CP Tranche Periods or Interest Periods, as
the case may be, or, if the requested period is not feasible, to
suggest an
7
15
alternative CP Tranche Period or Interest Period, PROVIDED THAT not
less than $1,000,000 of principal may be allocated to any CP Tranche
Period or Interest Period of any Lender, and no Alternate Base Rate
Loan may have a principal amount of less than $1,000,000.
The Borrower (or the Servicer on the Borrower's behalf) may
not request an Interest Period for a Eurodollar Loan unless it shall
have given the Co-Agents written notice of its desire therefor not
later than 12:00 noon (New York City time) at least 3 Business Days
prior to the first day of the desired Interest Period. Accordingly, all
Liquidity Fundings shall initially be Alternate Base Rate Loans.
Unless the Co-Agents shall have received written notice by
12:00 noon (New York City time) on the second Business Day prior to the
last day of a CP Tranche Period that the Borrower intends to reduce the
aggregate principal amount of the Conduits' respective CP Rate Loans
outstanding, each Conduit shall be entitled to assume that the Borrower
desires to refinance its maturing CP Rate Loans on the last day of such
CP Tranche Period with new CP Rate Loans in like principal amounts with
CP Tranche Periods of approximately the same duration; PROVIDED,
HOWEVER, that neither Conduit shall be liable for failure to effect
such refinancing and the Borrower shall remain liable for failure to
pay the matured CP Rate Loans which were not so refinanced.
Unless the Co-Agents shall have received written notice by
12:00 noon (New York City time) on the third Business Day prior to the
last day of an Interest Period that the Borrower intends to reduce the
aggregate principal amount of the Eurodollar Loans outstanding from the
Liquidity Banks, each of the Liquidity Banks shall be entitled to
assume that the Borrower desires to refinance its maturing Eurodollar
Loans on the last day of such Interest Period with Alternate Base Rate
Loans.
Section 2.3 COMPUTATION OF CONCENTRATION LIMITS AND UNPAID
BALANCE. The Obligor Concentration Limits and the aggregate Unpaid Balance of
Receivables of each Obligor and its Affiliated Obligors (if any) shall be
calculated as if each such Obligor and its Affiliated Obligors were one Obligor.
Section 2.4 MAXIMUM INTEREST RATE. No provision of this
Agreement shall require the payment or permit the collection of interest in
excess of the maximum permitted by applicable law.
Section 2.5 PAYMENTS AND COMPUTATIONS, ETC.
(a) PAYMENTS. The Borrower or the Servicer, as the case may
be, shall initiate a wire transfer of immediately available funds of all amounts
to be paid or deposited by the Borrower or the Servicer to any of the Agents or
the Lenders (other than amounts payable under SECTION 4.2) no later than 11:00
a.m. (New York City time) on the day when due in lawful money of the United
States of America to the applicable Co-Agent at such Co-Agent's address
specified in SCHEDULE 14.2, and, to the extent such payment is for the account
of a Lender, such Co-Agent shall promptly disburse such funds to the appropriate
Lender.
8
16
(b) LATE PAYMENTS. To the extent permitted by law, upon
demand, the Borrower or the Servicer, as applicable, shall pay to the applicable
Co-Agent for the account of each Person to whom payment of any Obligation is
due, interest on all amounts not paid or deposited by 2:00 p.m. (New York City
time) on the date when due (without taking into account any applicable grace
period) at the Default Rate as specified in SECTION 10.1(a), PROVIDED, HOWEVER,
that no such interest rate shall at any time exceed the maximum rate permitted
by applicable law.
(c) METHOD OF COMPUTATION. All computations of interest,
Servicer's Fee, any per annum fees payable under SECTION 4.1 and any other per
annum fees payable by the Borrower to the Lenders, the Servicer or the Agents
under the Loan Documents shall be made on the basis of a year of 360 days for
the actual number of days (including the first day but excluding the last day)
elapsed.
(d) AVOIDANCE OR RECISSION OF PAYMENTS. To the maximum extent
permitted by applicable law, no payment of any Obligation shall be considered to
have been paid if at any time such payment is rescinded or must be returned for
any reason.
Section 2.6 NON-RECEIPT OF FUNDS BY THE CO-AGENTS. Unless a
Lender notifies its Co-Agent prior to the date and time on which it is scheduled
to fund a Loan that it does not intend to fund, such Co-Agent may assume that
such funding will be made and may, but shall not be obligated to, make the
amount of such Loan available to the intended recipient in reliance upon such
assumption. If such Lender has not in fact funded its Loan proceeds to its
Co-Agent, the recipient of such payment shall, on demand by such Co-Agent, repay
to such Co-Agent the amount so made available together with interest thereon in
respect of each day during the period commencing on the date such amount was so
made available by such Co-Agent until the date such Co-Agent recovers such
amount at a rate per annum equal to the Federal Funds Rate for such day.
ARTICLE III.
SETTLEMENTS
Section 3.1 REPORTING.
(a) INFORMATION PACKAGES. Not later than 15 Business Days
after each Cut-Off Date hereafter (each, a "REPORTING DATE"), the Servicer shall
deliver to the Co-Agents, a report in the form of EXHIBIT 3.1(a) (each, an
"INFORMATION PACKAGE") accompanied by an electronic file in a form reasonably
satisfactory to the Co-Agents; PROVIDED, HOWEVER, that if an Event of Default
shall exist and be continuing, either of the Co-Agents may request that a
computation of the Borrowing Base be made more frequently than monthly.
(b) INTEREST; OTHER AMOUNTS DUE. At or before 12:00 noon (New
York City time) on the Business Day before each Settlement Date, each of the
Co-Agents shall notify the Borrower and the Servicer of (i) the aggregate
principal balance of all Loans made by such Co-Agent's constituent Lenders that
are then outstanding, and (ii) the aggregate amount of all
9
17
principal, interest and fees that will be due and payable by the Borrower to
such Co-Agent for the account of such Co-Agent or its constituent Lenders on
such Settlement Date.
Section 3.2 TURNOVER OF COLLECTIONS. Without limiting the
Agents' and the Lenders' recourse to the Borrower for payment of any and all
Obligations:
(a) If any Information Package reveals that a mandatory
prepayment is required under SECTION 1.5(b) or (c), not later than the 12:00
noon (New York City time) on the next succeeding Settlement Date, the Servicer
shall turn over to the Co-Agents, for distribution to their respective
constituent Lenders, a portion of the Collections equal to the aggregate amount
of such required mandatory prepayments;
(b) If any Loans are to be voluntarily prepaid on a Settlement
Date in accordance with SECTION 1.5(a), on such Settlement Date, the Servicer
shall turn over to the Co-Agents, for distribution to their respective
constituent Lenders, a portion of the Collections equal to the aggregate amount
of such optional prepayment; and
(c) In addition to, but without duplication of, the foregoing,
on (i) each Settlement Date and (ii) each other date on which any principal of
or interest on any of the Loans becomes due (whether by acceleration or
otherwise), the Servicer shall turn over to the Co-Agents, for distribution to
their respective constituent Lenders, a portion of the Collections equal to the
aggregate amount all Obligations that are due and owing on such date.
If the Collections are insufficient to make all payments required under clauses
(a), (b) and (c) and the Servicer's Fees and, if applicable, all expenses due
and owing to any replacement Servicer under SECTION 8.1(d) (all of the
foregoing, collectively, the "REQUIRED AMOUNTS") and the Borrower has made any
Demand Advances, the Borrower shall make demand upon INTERIM SERVICES for
payment of the Demand Advances in an amount equal to the lesser of the Required
Amounts or the aggregate outstanding principal balance of such Demand Advances
(plus any accrued and unpaid interest thereon) and, upon receipt of any such
amounts, the Borrower shall pay them to the Co-Agents for distribution in
accordance with this SECTION 3.2.
(d) If the amount of Collections and payments on Demand
Advances received by the Co-Agents on any Settlement Date are insufficient to
pay all Required Amounts, such amount shall be applied to the items specified in
the subclauses below, in the order of priority of such subclauses:
(i) to any accrued and unpaid interest on the Loans that is
then due and owing, including any previously accrued interest which was not paid
on its applicable due date;
(ii) if the Servicer is not the Borrower or an Affiliate
thereof, to any accrued and unpaid Servicer's Fee that is then due and owing to
such Servicer, together with any invoiced expenses of the Servicer due and owing
pursuant to SECTION 8.1(d);
10
18
(iii) to the Facility Fee and the Usage Fee accrued during
such Settlement Period, plus any previously accrued Facility Fee and Usage Fee
not paid on a prior Settlement Date;
(iv) to the payment of the principal of any Loans that are
then due and owing;
(v) to other Obligations that are then due and owing;
(vi) if the Servicer is the Borrower, INTERIM SERVICES or one
of their respective Affiliates, to the accrued and unpaid Servicer's Fee and
Supplemental Servicer's Fee that are then due and owing to such Servicer; and
(vii) the balance, if any, to the Borrower.
Section 3.3 NON-DISTRIBUTION OF SERVICER'S FEE. Each of the
Agents and the Secured Parties hereby consents to the retention by the Servicer
of a portion of the Collections equal to the Servicer's Fee (and, if applicable,
any invoiced expenses of such Servicer that are due and owing pursuant to
SECTION 8.1(d)) so long as the Collections received by the Servicer are
sufficient to pay all amounts pursuant to SECTION 3.2 of a higher priority as
specified in such Section.
Section 3.4 DEEMED COLLECTIONS. If on any day:
(a) the Unpaid Balance of any Receivable is reduced as a
result of any rejected services, any cash discount, any Applicable Rebill, or
any other adjustment by any Loan Party or any Affiliate thereof, or as a result
of any tariff or other governmental or regulatory action, or
(b) the Unpaid Balance of any Receivable is reduced or
canceled as a result of a setoff in respect of any claim by the Obligor thereof
(whether such claim arises out of the same or a related or an unrelated
transaction), or
(c) the Unpaid Balance of any Receivable is reduced on account
of the obligation of any Loan Party or any Affiliate thereof to pay to the
related Obligor any rebate or refund, or
(d) the Unpaid Balance of any Receivable is less than the
amount included in calculating the Net Pool Balance for purposes of any
Information Package (for any reason other than such Receivable becoming a
Defaulted Receivable), or
(e) any of the representations or warranties of the Borrower
set forth in SECTION 6.1(j), (l) or (p) were not true when made with respect to
any Receivable, or any of the representations or warranties of the Borrower set
forth in SECTION 6.1(l) are no longer true with respect to any Receivable, or
any Receivable is repurchased by any of the Originators pursuant to the Sale
Agreement,
then, on such day, the Borrower shall be deemed to have received a Collection of
such Receivable (1) in the case of clauses (a)-(d) above, in the amount of such
reduction or
11
19
cancellation or the difference between the actual Unpaid Balance and the amount
included in calculating such Net Pool Balance, as applicable; and (2) in the
case of clause (e) above, in the amount of the Unpaid Balance of such
Receivable.
ARTICLE IV.
FEES AND YIELD PROTECTION
Section 4.1 FEES. INTERIM SERVICES or the Borrower, as
applicable, shall pay to the Agents and the Lenders certain fees from time to
time in amounts and payable on such dates as are set forth in the Fee Letters.
Section 4.2 YIELD PROTECTION.
If (i) Regulation D or (ii) any Regulatory Change occurring
after the date hereof:
(a) shall subject an Affected Party to any tax, duty or other
charge with respect to its Obligations or, as applicable, its Commitment or its
commitment under any Liquidity Agreement, or shall change the basis of taxation
of payments to the Affected Party of any Obligations, owed to or funded in whole
or in part by it or any other amounts due under this Agreement in respect of its
Obligations or, as applicable, its Commitment or its commitment under any
Liquidity Agreement except for (1) taxes based on, or measured by, net income,
or changes in the rate of tax on or determined by reference to the overall net
income, of such Affected Party imposed by the United States of America, by the
jurisdiction in which such Affected Party's principal executive office is
located and, if such Affected Party's principal executive office is not in the
United States of America, by the jurisdiction where such Affected Party's
principal office in the United States is located, (2) franchise taxes, taxes on,
or in the nature of, doing business taxes or capital taxes, or (3) withholding
taxes required for payments made to any foreign entity which, at the time such
foreign entity issues its Commitment or Liquidity Commitment or becomes an
assignee of a Lender hereunder, fails to deliver to the applicable Co-Agent and
the Borrower an accurate IRS Form 1001 or 4224, as applicable; or
(b) shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the Federal Reserve
Board, but excluding any reserve included in the determination of interest),
special deposit or similar requirement against assets of any Affected Party,
deposits or obligations with or for the account of any Affected Party or with or
for the account of any affiliate (or entity deemed by the Federal Reserve Board
to be an affiliate) of any Affected Party, or credit extended by any Affected
Party; or
(c) shall affect the amount of capital required or expected to
be maintained by any Affected Party; or
(d) shall impose any other condition affecting any Obligation
owned or funded in whole or in part by any Affected Party, or its rights or
obligations, if any, to make Loans or Liquidity Fundings; or
12
20
(e) shall change the rate for, or the manner in which the
Federal Deposit Insurance Corporation (or a successor thereto) assesses deposit
insurance premiums or similar charges;
and the result of any of the foregoing is or would be:
(x) to increase the cost to or to impose a cost on
(I) an Affected Party funding or making or maintaining any
Loan, any Liquidity Funding, or any commitment of such
Affected Party with respect to any of the foregoing, or (II)
any Agent for continuing its or the Borrower's relationship
with any Affected Party, in each case, in an amount deemed to
be material by such Affected Party,
(y) to reduce the amount of any sum received or
receivable by an Affected Party under this Agreement or under
its Liquidity Agreement, or
(z) to reduce the rate of return on such Affected
Party's capital as a consequence of its Commitment, its
Liquidity Commitment or the Loans made by it to a level below
that which such Affected Party could have achieved but for the
occurrence of such circumstances,
then, within thirty days after demand by such Affected Party (which demand shall
be made not more than 180 days after the date on which the Affected Party
becomes aware of such Regulatory Change and shall be accompanied by a
certificate setting forth, in reasonable detail, the basis of such demand and
the methodology for calculating, and the calculation of, the amounts claimed by
the Affected Party), the Borrower shall pay directly to such Affected Party such
additional amount or amounts as will compensate such Affected Party for such
actual additional cost, actual increased cost or actual reduction.
(f) Each Affected Party will promptly notify the Borrower and
the applicable Co-Agent of any event of which it has knowledge (including any
future event that, in the judgment of such Affected Party, is reasonably certain
to occur) which will entitle such Affected Party to compensation pursuant to
this SECTION 4.2; PROVIDED, HOWEVER, no failure to give or delay in giving such
notification shall adversely affect the rights of any Affected Party to such
compensation unless such notification is given more than 180 days after the
Affected Party becomes aware of such Regulatory Change.
(g) In determining any amount provided for or referred to in
this SECTION 4.2, an Affected Party may use any reasonable averaging and
attribution methods (consistent with its ordinary business practices) that it
(in its reasonable discretion) shall deem applicable. Any Affected Party when
making a claim under this SECTION 4.2 shall submit to the Borrower the
above-referenced certificate as to such actual increased cost or actual reduced
return (including calculation thereof in reasonable detail), which statement
shall, in the absence of demonstrable error, be conclusive and binding upon the
Borrower.
13
21
(h) Each of the Lenders agrees, and to require each Affected
Party to agree that, with reasonable promptness after an officer of such Lender
or such Affected Party responsible for administering the Transaction Documents
becomes aware that it has become an Affected Party under this SECTION 4.2, is
entitled to receive payments under this SECTION 4.2, or is or has become subject
to U.S. withholding taxes payable by any Loan Party in respect of its investment
hereunder, it will, to the extent not inconsistent with any internal policy of
such Person or any applicable legal or regulatory restriction, (i) use all
reasonable efforts to make, fund or maintain its commitment or investment
hereunder through another branch or office of such Affected Party, or (ii) take
such other reasonable measures, if, as a result thereof, the circumstances which
would cause such Person to be an Affected Party under this SECTION 4.2 would
cease to exist, or the additional amounts which would otherwise be required to
be paid to such Person pursuant to this SECTION 4.2 would be reduced, or such
withholding taxes would be reduced, and if the making, funding or maintaining of
such commitment or investment through such other office or in accordance with
such other measures, as the case may be, would not otherwise adversely affect
such commitment or investment or the interests of such Person; provided that
such Person will not be obligated to utilize such other lending office pursuant
to this SECTION 4.2 unless the Borrower agrees to pay all incremental expenses
incurred by such Person as a result of utilizing such other office as described
in clause (i) above.
(i) If any Liquidity Bank makes a claim for compensation under
this SECTION 4.2, the Borrower may propose an Eligible Assignee to such
Liquidity Bank's Co-Agent who is willing to accept an assignment of all of such
Liquidity Bank's rights and obligations under the Transaction Documents;
PROVIDED THAT any expenses or other amounts which would be owing to such
Liquidity Bank pursuant to any indemnification provision hereof (including, if
applicable, SECTION 4.3) shall be payable by the Borrower as if the Borrower had
prepaid the Loans of the assigning Lenders rather than such assigning Lenders
having assigned their respective interests hereunder. Provided that such
proposed Eligible Assignee is acceptable to such Co-Agent (who shall not
unreasonably withhold or delay its approval), the claiming Liquidity Bank will
be obligated to assign all of its rights and obligations to such proposed
Eligible Assignee within 10 Business Days after such Co-Agent gives its consent
to such proposed Eligible Assignee.
Section 4.3 FUNDING LOSSES. In the event that any Lender or
any Liquidity Bank shall actually incur any actual loss or expense (including
any actual loss or expense incurred by reason of the liquidation or reemployment
of deposits or other funds acquired by such Lender to make any Loan or such
Liquidity Bank to make any Liquidity Funding or maintain any Liquidity Funding)
as a result of (i) any payment of principal with respect to Lender's Loan being
made on any day other than the scheduled last day of an applicable CP Tranche
Period or Interest Period with respect thereto (it being understood that the
foregoing shall not apply to any Alternate Base Rate Loans), or (ii) any Loan
not being made in accordance with a request therefor under SECTION 2.1, then,
upon written notice from any Co-Agent to the Borrower and the Servicer, the
Borrower shall pay to the Servicer, the Servicer shall pay to the applicable
Co-Agent for the account of such Lender or Liquidity Bank, as applicable, the
amount of such actual loss or expense. Such written notice (which shall include
the methodology for calculating, and the calculation of, the amount of such
actual loss or expense, in reasonable detail) shall, in the absence of
demonstrable error, be conclusive and binding upon the Borrower and the
Servicer.
14
22
ARTICLE V.
CONDITIONS OF ADVANCES
Section 5.1 CONDITIONS PRECEDENT TO INITIAL ADVANCE. The
initial Advances pursuant to this Agreement is subject to the condition
precedent that each of the Co-Agents shall have received, on or before the date
of such initial Advance, the following each (unless otherwise indicated) dated
such date and in form and substance reasonably satisfactory to each of the
Co-Agents:
(a) The Sale Agreement, duly executed by the parties thereto;
(b) A certificate of the Secretary or Assistant Secretary of
each Loan Party certifying the names and true signatures of the officers
authorized on its behalf to sign this Agreement and the other Transaction
Documents to be delivered by it hereunder (on which certificate the Agents and
the Lenders may conclusively rely until such time as each of the Co-Agents shall
receive from such Loan Party a revised certificate meeting the requirements of
this SUBSECTION (b));
(c) The Certificate of Incorporation of each Loan Party, duly
certified by the Secretary of State of such Loan Party's state of incorporation,
as of a recent date acceptable to Co-Agents in each case together with a copy of
the by-laws of such Loan Party, duly certified by the Secretary or an Assistant
Secretary of such Loan Party;
(d) Copies of good standing certificates for each Loan Party,
issued by the Secretaries of State of the state of incorporation of such Loan
Party and the state where such Loan Party's principal place of business is
located;
(e) Acknowledgment copies (or other evidence of filing
reasonably acceptable to the Collateral Agent) of (i) proper financing
statements (Form UCC-1), in such form as the Collateral Agent may reasonably
request, naming each of the Originators as debtor and seller of its Receivables
and Related Assets, the Borrower as the secured party and purchaser thereof and
the Collateral Agent, as agent for the Secured Parties, as assignee, and (ii)
financing statements (Form UCC-1), in such form as the Collateral Agent may
reasonably request, naming the Borrower as the debtor and the Collateral Agent,
as agent for the Secured Parties, as the secured party, or other, similar
instruments or documents, as may be necessary or, in the opinion of the
Collateral Agent desirable under the UCC or any comparable law of all
appropriate jurisdictions to perfect the sale by each of the Originators to the
Borrower of, and the Collateral Agent's security interest in the Collateral;
(f) Search reports provided in writing to the Co-Agents (i)
listing all effective financing statements that name any Loan Party as debtor
and that are filed in the jurisdictions in which filings were made pursuant to
SUBSECTION (e) above and in such other jurisdictions that the Collateral Agent
shall reasonably request, together with copies of such financing statements
(none of which (other than any of the financing statements described in
SUBSECTION (e) above) shall cover any Receivables or Related Assets), and (ii)
listing all tax liens and judgment liens (if
15
23
any) filed against any debtor referred to in CLAUSE (i) above in the
jurisdictions described therein and showing no such Liens;
(g) The Subordinated Notes, duly executed by the Borrower;
(h) A favorable opinion of counsel to Loan Parties admitted to
practice in the State of New York, covering the matters set forth in of EXHIBIT
5.1(h);
(i) Favorable opinions of counsel to Loan Parties, as to:
(1) the existence of a "true sale" of the Receivables
from each of the Originators to the Borrower under the Sale
Agreement; and
(2) the inapplicability of the doctrine of
substantive consolidation to the Borrower and each of the
Originators in connection with any bankruptcy proceeding
involving any Loan Party;
(j) A PRO FORMA Information Package, prepared as of the
Cut-Off Date of May 23, 1999;
(k) A report in form and substance satisfactory to the
Co-Agents from the Initial Due Diligence Auditor as to a pre-closing due
diligence audit by the Initial Due Diligence Auditor;
(l) Each of the Liquidity Agreements, in form and substance
satisfactory to the applicable Co-Agent, duly executed by the parties thereto;
(m) UCC-3 partial releases and/or termination statements with
respect to any existing Liens on the Collateral;
(n) With respect to INTERIM SERVICES, copies of its most
recent reports on SEC Forms 10-K and 10-Q;
(o) The Fee Letter to which such Co-Agent is a party, together
with payment of any and all fees due on or prior to the date of the initial
Advance;
(p) A certificate of an Authorized Officer of each of the Loan
Parties certifying that as of the date of the initial Advance, no Event of
Default or Unmatured Event of Default exists and is continuing;
(q) Letters in the form of Exhibit 6.1(q) hereto, addressed to
the Agents and the Lenders, and duly executed by each of the Originators and the
Loan Parties; and
(r) Such other agreements, instruments, certificates, opinions
and other documents as any of the Agents may reasonably request.
16
24
Section 5.2 CONDITIONS PRECEDENT TO ALL ADVANCES. Each Advance
(including the initial Advance) shall be subject to the further conditions
precedent that on the applicable Borrowing Date, each of the following
statements shall be true (and the Borrower, by accepting the amount of such
Advances or by receiving the proceeds of any Loan comprising such Advance, and
each other Loan Party, upon such acceptance or receipt by the Borrower, shall be
deemed to have certified that):
(a) the representations and warranties contained in SECTION
6.1 are correct in all material respects on and as of the date of such Advance
as though made on and as of such day and shall be deemed to have been made on
such day,
(b) no event has occurred and is continuing, or would result
from such Advance, that constitutes an Event of Default or Unmatured Default,
(c) after giving effect to each proposed Advance, the Advances
will not exceed the lesser of the Borrowing Base or the Aggregate Commitment,
the Loans made by Blue Ridge and its Liquidity Banks will not exceed the Blue
Ridge Allocation Limit, and the Loans made by Falcon and its Liquidity Banks
will not exceed the Falcon Allocation Limit,
(d) the Termination Date shall not have occurred, and
(e) the Co-Agents shall have timely received an appropriate
Borrowing Request in accordance with SECTION 2.1;
PROVIDED, HOWEVER, the absence of the occurrence and continuance of an Unmatured
Default shall not be a condition precedent to any Advance which does not
increase the aggregate principal amount of all Advances outstanding over the
aggregate outstanding principal balance of the Advances as of the opening of
business on such day.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES
Section 6.1 REPRESENTATIONS AND WARRANTIES OF LOAN PARTIES.
Each Loan Party represents and warrants, as to itself, as follows:
(a) DUE INCORPORATION AND GOOD STANDING; OWNERSHIP OF THE
BORROWER. Each Loan Party is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation or
formation. INTERIM SERVICES owns, directly or indirectly, all the issued and
outstanding capital stock of the Borrower, and all of such capital stock is
fully paid and non-assessable and free and clear of any Liens.
(b) DUE QUALIFICATION. Each Loan Party is duly qualified to do
business as a foreign corporation in good standing in all jurisdictions not
covered by SECTION 6.1(a) in which the ownership or lease of property or the
conduct of its business requires such qualification, except where the failure to
be so qualified or have such licenses or approvals would not have a Material
Adverse Effect.
17
25
(c) POWER AND AUTHORITY; DUE AUTHORIZATION. Each Loan Party
(i) has all necessary power, authority and legal right, and has obtained all
necessary licenses and approvals, (A) to execute and deliver this Agreement and
the other Transaction Documents to which it is a party, (B) to carry out the
terms of the Transaction Documents to which it is a party, (C) in the case of
the Servicer (or any Affiliate thereof that is acting as a sub-servicer), to
service the Receivables and the Related Assets in accordance with this Agreement
and the Sale Agreement, and (D) in the case of the Borrower, to grant the
security interest in the Collateral and borrow the Loans on the terms and
conditions herein provided, and (ii) has duly authorized by all necessary
corporate action the execution, delivery and performance of this Agreement and
the other Transaction Documents to which it is a party and, in the case of the
Borrower, the security interest described in CLAUSE (i)(D) above.
(d) TITLE TO RECEIVABLES; VALID SECURITY INTEREST. Each
Receivable has been acquired by the Borrower from the applicable Originator in
accordance with the terms of the Sale Agreement, and the Borrower has thereby
irrevocably obtained all legal and equitable title to, and has the legal right
to sell and encumber, such Receivable and the Related Assets. Each such
Receivable has been transferred to the Borrower free and clear of any Lien
except as created hereby. Without limiting the foregoing, there have been duly
filed all financing statements or other similar instruments or documents
necessary under the UCC of all appropriate jurisdictions to perfect the
Borrower's ownership interest in such Receivable. This Agreement creates a valid
security interest in the Collateral in favor of the Collateral Agent, for the
benefit of the Secured Parties, enforceable against creditors of and purchasers
from the Borrower.
(e) NONCONTRAVENTION. The execution, delivery and performance
by such Loan Party of this Agreement and each other Transaction Document to
which it is party do not and will not: (i) contravene the terms of any of its
articles or certificate of incorporation or by-laws; (ii) conflict with or
result in a material breach or contravention of, or the creation of any Lien
under, any document evidencing any material Contractual Obligation to which such
Person is a party or any order, injunction, writ or decree of any Governmental
Authority to which such Person or its property is subject; or (iii) violate any
Requirement of Law.
(f) NO PROCEEDINGS. There are no actions, suits, labor
controversies, proceedings, claims or disputes pending, or to the best knowledge
of such Loan Party, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against such Loan Party, or
its Subsidiaries or any of their respective properties which: (i) purport to
affect or pertain to this Agreement or any other Transaction Document, or any of
the transactions contemplated hereby or thereby; or (ii) if determined adversely
to such Loan Party or its Subsidiaries, would reasonably be expected to have a
Material Adverse Effect. No injunction, writ, temporary restraining order or
order of any nature has been issued by any court or other Governmental Authority
purporting to enjoin or restrain the execution, delivery or performance of this
Agreement or any other Transaction Document, or directing that the transactions
provided for herein or therein not be consummated as herein or therein provided.
The Loan Parties are generally subject to suit and none of them nor any of their
properties or revenues enjoys any right of immunity from judicial proceedings.
(g) ENFORCEABILITY. This Agreement and each other Transaction
Document signed by such Loan Party constitutes, a legal, valid and binding
obligation of such Loan Party,
18
26
enforceable in accordance with its terms (except as enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws affecting the
enforcement of creditors' rights generally or by equitable principles relating
to enforceability).
(h) GOVERNMENT APPROVALS. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, such Loan Party
of this Agreement or any other Transaction Document, EXCEPT, in the case of the
Borrower, for (i) the filing of the UCC financing statements referred to in
ARTICLE V, and (ii) the filing of any UCC continuation statements and amendments
from time to time required in relation to any UCC financing statements filed in
connection with this Agreement, as provided in SECTION 8.5, all of which, at the
time required in ARTICLE V or SECTION 8.5, as applicable, shall have been duly
made and shall be in full force and effect.
(i) FINANCIAL STATEMENTS AND ABSENCE OF CERTAIN MATERIAL
ADVERSE CHANGES.
(x) Each of the financial statements of INTERIM
SERVICES and its consolidated Subsidiaries previously or
hereafter furnished to any of the Agents, fairly presents in
all material respects the consolidated financial condition of
INTERIM SERVICES and its consolidated Subsidiaries, taken as a
whole, as at the dates thereof and the results of their
consolidated operations for the periods covered thereby and
each of such financial statements has been prepared in
accordance with GAAP consistently applied (subject, in the
case of interim financial statements, to customary year-end
audit adjustments).
(y) From December 25, 1998 through and including the
date of the initial Advance, there has been no material
adverse change in INTERIM SERVICES' consolidated financial
condition, business or operations. Since the date of the
initial Advance, there has been no material adverse change in
INTERIM SERVICES' consolidated financial condition, business
or operations that has had, or would reasonably be expected to
have, a material adverse effect upon its ability to perform
its obligations, as an Originator or as Servicer, under the
Transaction Documents when and as required, and no material
adverse effect on the collectibility of any material portion
of the Receivables.
(z) Since the date of the initial Advance, no event
has occurred which would have a Material Adverse Effect.
(j) NATURE OF RECEIVABLES. Each Receivable constitutes an
"Account" or a "General Intangible."
(k) MARGIN REGULATIONS. The use of all funds obtained by such
Loan Party under this Agreement or any other Transaction Document will not
conflict with or contravene
19
27
any of Regulations T, U and X promulgated by the Board of Governors of the
Federal Reserve System from time to time.
(l) QUALITY OF TITLE. (i) Each Receivable, together with the
Related Assets, is owned by the Borrower free and clear of any Lien (other than
any Lien arising solely as the result of any action taken by the Collateral
Agent or one of the Secured Parties); (ii) the Collateral Agent, on behalf of
the Secured Parties, has a valid and perfected first priority security interest
in the Collateral; and (iii) no financing statement or other instrument similar
in effect covering any portion of the Collateral is on file in any recording
office except such as may be filed (A) in favor of an Originator in accordance
with the Contracts and/or Invoices, (B) in favor of the Borrower and its assigns
in connection with the Sale Agreement, or (C) in favor of the Collateral Agent
in accordance with this Agreement or in connection with any Lien arising solely
as the result of any action taken by the Collateral Agent or one of the Secured
Parties.
(m) ACCURATE REPORTS. No Information Package (if prepared by
such Loan Party, or to the extent information therein was supplied by such Loan
Party), no other information furnished verbally or in writing prior to the date
of this Agreement, and no other information, exhibit, financial statement,
document, book, record or report furnished or to be furnished in writing after
the date of this Agreement, by or on behalf of such Loan Party to any of the
Agents or Lenders pursuant to this Agreement was or will be inaccurate in any
material respect as of the date it was or will be dated or (except as otherwise
disclosed to the Agents or the Lenders at such time) as of the date so
furnished, or contained or (in the case of information or other materials to be
furnished in the future) will contain any material misstatement of fact or
omitted or (in the case of information or other materials to be furnished in the
future) will omit to state a material fact or any fact necessary to make the
statements contained therein not materially misleading in light of the
circumstances made or presented.
(n) OFFICES. The principal places of business and chief
executive offices of the Servicer and the Borrower are located at the respective
addresses set forth on SCHEDULE 14.2, and the offices where the Servicer and the
Borrower keep all their books, records and documents evidencing Receivables, the
related Contracts and/or Invoices and all purchase orders and other agreements
related to such Receivables are located at the addresses specified in SCHEDULE
6.1(n) (or at such other locations, notified to the Collateral Agent in
accordance with SECTION 7.1(f), in jurisdictions where all action required by
SECTION 8.5 has been taken and completed).
(o) LOCK-BOX ACCOUNTS. The names and addresses of all the
Lock-Box Banks, together with the account numbers of the accounts of the
Borrower at such Lock-Box Banks, are specified in SCHEDULE 6.1(o) (or have been
notified to and approved by the Agents in accordance with SECTION 7.3(d)). Each
of the Lock-Box Accounts is subject to a Lock-Box Agreement that is in full
force and effect.
(p) ELIGIBLE RECEIVABLES. Each Receivable included as an
Eligible Receivable in the Net Pool Balance in connection with any computation
or recomputation of the Borrowing Base is an Eligible Receivable on such date.
(q) YEAR 2000 READINESS. In addition to the matters referenced
in the letters attached as Exhibit 6.1(q) hereto, each Loan Party reasonably
believes that all computer
20
28
applications that are material to its business and operations will on a timely
basis be able to perform properly date-sensitive functions for all dates before,
on and after January 1, 2000 (that is, be "YEAR 2000 COMPLIANT"), except to the
extent that a failure to do so could not reasonably be expected to have a
Material Adverse Effect.
(r) NAMES. In the past five years, the Borrower has not used
any corporate names, trade names or assumed names other than the name in which
it has executed this Agreement.
(s) CREDIT AND COLLECTION POLICY. With respect to each
Receivable, each of the applicable Originator, the Borrower and the Servicer has
complied in all material respects with the applicable Credit and Collection
Policy, and no change has been made to such Credit and Collection Policy since
the date of this Agreement which would be reasonably likely to materially and
adversely affect the collectibility of the Receivables or decrease the credit
quality of any newly created Receivables except for such changes as to which
each of the Agents have received the notice required under SECTION 7.2(j) and
has given its prior written consent thereto (which consent shall not be
unreasonably withheld or delayed).
(t) PAYMENTS TO ORIGINATOR. With respect to each Receivable
sold to the Borrower by any Originator, the Borrower has given reasonably
equivalent value to such Originator in consideration for such Receivable and the
Related Assets with respect thereto under the Sale Agreement and such transfer
was not made for or on account of an antecedent debt. No transfer by any
Originator of any Receivable is or may be voidable under any Section of the
Bankruptcy Reform Act of 1978 (11 U.S.C. ss.ss.101 ET seq.), as amended.
(u) NOT AN INVESTMENT COMPANY. The Borrower is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended from time to time, or any successor statute.
(v) BORROWING BASE. As of each Borrowing Date, after giving
effect to the Loans to be made on such date, the Borrowing Base is at least
equal to the aggregate outstanding principal balance of the Advances.
ARTICLE VII.
GENERAL COVENANTS OF LOAN PARTIES
Section 7.1 AFFIRMATIVE COVENANTS OF LOAN PARTIES. From the
date hereof until the Final Payout Date, unless each of the Co-Agents shall
otherwise consent in writing:
(a) COMPLIANCE WITH LAWS, ETC. Each Loan Party will comply in
all material respects with all applicable laws, rules, regulations and orders,
including those with respect to the Receivables and related Contracts and/or
Invoices, except where the failure to so comply would not individually or in the
aggregate have a Material Adverse Effect.
(b) PRESERVATION OF CORPORATE EXISTENCE. Each Loan Party will
preserve and maintain its corporate existence, rights, franchises and privileges
in the jurisdiction of its incorporation, and qualify and remain qualified in
good standing as a foreign corporation in each
21
29
jurisdiction where the failure to preserve and maintain such existence, rights,
franchises, privileges and qualification would have a Material Adverse Effect.
(c) AUDITS. Each Loan Party will (i) at any time and from time
to time upon not less than ten (10) Business Days' notice (unless an Event of
Default has occurred and is continuing, in which case no such notice shall be
required) during regular business hours, permit the Co-Agents or any of their
agents or representatives: (A) to examine and make copies of and abstracts from
all books, records and documents (including, without limitation, computer tapes
and disks) in the possession or under the control of such Loan Party relating to
Receivables, including, without limitation, the related Contracts and/or
Invoices and purchase orders and other agreements, and (B) to visit the offices
and properties of such Loan Party for the purpose of examining such materials
described in CLAUSE (i)(A) next above, and to discuss matters relating to
Receivables or such Loan Party's performance hereunder with any of the officers
or employees of such Loan Party having knowledge of such matters; and (ii)
without limiting the provisions of CLAUSE (i) above, from time to time, at the
expense of such Loan Party, permit INTERIM SERVICES' outside auditors (except as
hereinafter provided) or other certified public accountants or auditors
acceptable to the Co-Agents to conduct a review of such Loan Party's books and
records with respect to the Receivables and Related Assets (each, a "REVIEW");
PROVIDED, HOWEVER, that, so long as no Event of Default has occurred and is
continuing, the Loan Parties shall only be responsible for the costs and
expenses of one such Review under this Section or under SECTION 7.2(i) in any
one calendar year except as provided in the next sentence. Notwithstanding the
foregoing, if (1) any Loan Party requests the approval of a new Eligible
Originator who is a Material Proposed Addition or (2) any Material Acquisition
is consummated, the Loan Parties shall be responsible for the costs and expenses
of one additional Review per proposed Material Proposed Addition or per Material
Acquisition in the Contract Year in which such Material Proposed Addition is
expected to occur or such Material Acquisition is expected to be consummated if
such additional Review is requested by the Co-Agents. In the event that INTERIM
SERVICES' outside auditors fail to perform any Review to the reasonable
satisfaction of the Co-Agents, thereafter, the Co-Agents shall have the
exclusive right to select the accountants or auditors who perform Reviews.
(d) KEEPING OF RECORDS AND BOOKS OF ACCOUNT. The Servicer will
maintain and implement administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing Receivables in the
event of the destruction of the originals thereof), and keep and maintain, all
documents, books, records and other information reasonably necessary or
advisable for the collection of all Receivables (including, without limitation,
records adequate to permit the daily identification of outstanding Unpaid
Balances by Obligor and related debit and credit details of the Receivables).
Each of the Borrower and the Servicer shall post all Demand Advances to its
respective books and records in accordance with GAAP on or before each
Settlement Date.
(e) PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS
AND/OR INVOICES. Each Loan Party will, at its expense, timely and fully perform
and comply with all material provisions, covenants and other promises, if any,
required to be observed by it under the Contracts and/or Invoices related to the
Receivables and all agreements related to such Receivables.
22
30
(f) LOCATION OF RECORDS. Each Loan Party will keep its chief
place of business and chief executive office, and the offices where it keeps its
records concerning the Receivables, all related Contracts and/or Invoices and
all agreements related to such Receivables (and all original documents relating
thereto), at the address(es) of the Servicer and the Borrower referred to in
SECTION 6.1(n) or, upon 15 days' prior written notice to the Collateral Agent,
at such other locations in jurisdictions where all action required by SECTION
8.5 shall have been taken and completed.
(g) CREDIT AND COLLECTION POLICIES. Each Loan Party will
comply in all material respects with the Credit and Collection Policy in regard
to each Receivable and the related Contracts and/or Invoices.
(h) SALE AGREEMENT. The Borrower will perform and comply in
all material respects with all of its covenants and agreements set forth in the
Sale Agreement, and will enforce the performance by each of the Originators of
its obligations under the Sale Agreement.
(i) COLLECTIONS. All Obligors shall be instructed to make
payments on Receivables directly to a Lock-Box Account which is the subject of a
Lock-Box Agreement. If, notwithstanding the foregoing, any Collections are paid
directly to any Loan Party, such Loan Party shall deposit the same (with any
necessary indorsements) to such a Lock-Box Account within two (2) Business Days
after receipt thereof. Upon demand of the Collateral Agent, the Borrower or the
Servicer shall establish a segregated account at Wachovia Bank, N.A. which is
subject to a perfected security interest in favor of the Collateral Agent, for
the benefit of the Secured Parties (the "COLLECTION ACCOUNT"), into which all
deposits from time to time in Lock-Box Accounts, and all other Collections, are
concentrated pending application in accordance with the terms of this Agreement
to the Obligations.
(j) FURTHER ASSURANCES. Each of the Loan Parties shall take
all necessary action to establish and maintain (i) in favor of the Borrower, a
valid and perfected ownership interest in the Receivables and Related Assets,
and (ii) in favor of the Collateral Agent for the benefit of the Secured
Parties, a valid and perfected first priority security interest in the
Receivables and the Related Assets, including, without limitation, taking such
action to perfect, protect or more fully evidence the interest of the Collateral
Agent as the Collateral Agent may reasonably request.
Section 7.2 REPORTING REQUIREMENTS OF LOAN PARTIES. From the
date hereof until the Final Payout Date, unless each of the Co-Agents shall
otherwise consent in writing:
(a) QUARTERLY FINANCIAL STATEMENTS. INTERIM SERVICES will
furnish to the Co-Agents as soon as available and in any event within 60 days
after the end of each of the first three quarters of each of its fiscal years,
copies of its report on SEC Form 10-Q as of the close of such fiscal quarter;
(b) ANNUAL FINANCIAL STATEMENTS. INTERIM SERVICES will furnish
to the Co-Agents, as soon as available and in any event within 120 days after
the end of each fiscal year of INTERIM SERVICES, copies of its annual report on
SEC Form 10-K for such year;
23
31
(c) REPORTS TO SEC AND EXCHANGES. In addition to the reports
required by SUBSECTIONS (a) and (b) next above, promptly upon filing any report
on SEC Form 8-K with the SEC, INTERIM SERVICES shall deliver copies thereof to
the Co-Agents;
(d) ERISA. Promptly after the filing or receiving thereof,
each Loan Party will furnish to the Co-Agents copies of all reports and notices
with respect to any Reportable Event defined in Article IV of ERISA which any
Loan Party files under ERISA with the Internal Revenue Service, the Pension
Benefit Guaranty Corporation or the U.S. Department of Labor or which such Loan
Party receives from the Pension Benefit Guaranty Corporation;
(e) EVENTS OF DEFAULT, ETC. As soon as possible and in any
event within five (5) Business Days after any Responsible Officer of either Loan
Party obtains knowledge of the occurrence of any Event of Default or any
Unmatured Default, each Loan Party will furnish to the Co-Agents a written
statement of a Responsible Officer of such Loan Party setting forth details of
such event and the action that such Loan Party will take with respect thereto;
(f) LITIGATION. As soon as possible and in any event within
ten Business Days after any Responsible Officer of either Loan Party obtains
knowledge thereof, such Loan Party will furnish to the Co-Agents notice of (i)
any litigation, investigation or proceeding which may exist at any time which
would reasonably be expected to have a Material Adverse Effect and (ii) any
development in previously disclosed litigation which development would
reasonably be expected to have a Material Adverse Effect;
(g) REVIEWS OF RECEIVABLES. As soon as available and in any
event within 90 days following the end of each fiscal year of the Borrower, the
Borrower will furnish to the Co-Agents a report of the Review referenced in
SECTION 7.1(c) prepared by accountants or auditors selected as specified therein
and reasonably acceptable to the Agents as of the end of such fiscal year,
substantially in the form of the report delivered pursuant to SECTION 5.1(k) and
covering such other matters as any of the Agents may reasonably request in order
to protect the interests of the Collateral Agent or the Secured Parties under or
as contemplated by this Agreement. Unless the performance of the Receivables
indicates that broader testing is appropriate, such reviews will be limited to
the matters summarized in SCHEDULE 2 hereto;
(h) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. Each
Loan Party will furnish to the Co-Agents prompt written notice of any material
change in the character of such Loan Party's business prior to the occurrence of
such change, and each Loan Party will provide the Agents with not less than 15
Business Days' prior written notice of any material change in the Credit and
Collection Policy (together with a copy of such proposed change);
(i) ACCOUNTING PERIODS. Not later than December 1 of each
year, the Loan Parties will deliver to the Co-Agents a listing of their
accounting periods for the upcoming calendar year, and Schedule 1 hereto will be
deemed amended to add such dates to SCHEDULE 1 hereto;
(j) OTHER. Promptly, from time to time, each Loan Party will
furnish to the Co-Agents such other information, documents, records or reports
respecting the Receivables or the condition or operations, financial or
otherwise, of such Loan Party as any of the Agents may
24
32
from time to time reasonably request in order to protect the interests of the
Collateral Agent or the Secured Parties under or as contemplated by this
Agreement.
Section 7.3 NEGATIVE COVENANTS OF LOAN PARTIES. From the date
hereof until the Final Payout Date, without the prior written consent of each of
the Co-Agents:
(a) SALES, LIENS, ETC. (i) The Borrower will not, except as
otherwise provided herein and in the other Transaction Documents, sell, assign
(by operation of law or otherwise) or otherwise dispose of, or create or suffer
to exist any Lien upon or with respect to, any Collateral, or any account to
which any Collections are sent, or any right to receive income or proceeds from
or in respect of any of the foregoing (except, prior to the execution of
Lock-Box Agreements, set-off rights of any bank at which any such account is
maintained), and (ii) the Servicer will not assert any interest in the
Receivables, except as the Servicer.
(b) EXTENSION OR AMENDMENT OF RECEIVABLES. No Loan Party will,
except as otherwise permitted in SECTION 8.2(c), extend, amend or otherwise
modify the terms of any Receivable, or amend, modify or waive any material term
or condition of any Contract and/or Invoice related thereto in any way that
adversely affects the collectibility of any Receivable or the Lender's rights
therein.
(c) CHANGE IN BUSINESS OR CREDIT AND COLLECTION POLICY. No
Loan Party will make or permit to be made 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 any significant portion of the Receivables or
otherwise materially and adversely affect the interests or remedies of Lender
under this Agreement or any other Transaction Document.
(d) CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS. No Loan Party
will add or terminate any bank as a Lock-Box Bank from those listed in SCHEDULE
6.1(o) or, after the Collection Account has been established pursuant to SECTION
7.1(i), make any change in its instructions to Obligors regarding payments to be
made to the Borrower or the Servicer or payments to be made to any Lock-Box Bank
(except for a change in instructions solely for the purpose of directing
Obligors to make such payments to another existing Lock-Box Bank), unless (i)
the Collateral Agent shall have received prior written notice of such addition,
termination or change and (ii) the Collateral Agent shall have received duly
executed copies of Lock-Box Agreements in a form reasonably acceptable to the
Agents with each new Lock-Box Bank.
(e) DEPOSITS TO LOCK-BOX ACCOUNTS AND COLLECTION ACCOUNT. No
Loan Party will deposit or otherwise credit, or cause or permit to be so
deposited or credited, to any Lock-Box Account or the Collection Account, any
cash or cash proceeds in excess of $5,000,000 per year other than Collections of
Receivables.
(f) CHANGES TO OTHER DOCUMENTS. The Borrower will not enter
into any amendment or modification of, or supplement to, the Sale Agreement, the
Subordinated Notes or the Borrower's Certificate of Incorporation, except that
the Borrower may enter into Joinder Agreements to add Eligible Originators as
sellers under the Sale Agreement.
25
33
(g) RESTRICTED PAYMENTS BY THE BORROWER. The Borrower will
not:
(i) Purchase or redeem any shares of the capital
stock of the Borrower, declare or pay any dividends thereon
(other than stock dividends), make any distribution to
stockholders or set aside any funds for any such purpose,
unless, in each of the foregoing cases: (A) such purchase,
redemption, payment or distribution is made on, or immediately
following, a Settlement Date after payment of all Obligations
due and owing on such Settlement Date, and (B) after giving
effect to such purchase, redemption, payment or distribution,
the Borrower's net worth (determined in accordance with GAAP)
will be at least $4,500,000 at all times prior to the addition
of ▇▇▇▇▇▇▇ Corporation and/or its Subsidiaries (or any
successor thereto) as an Eligible Originator, and $5,000,000
at all times thereafter; or
(ii) Make any payment of principal or interest on the
Subordinated Notes if any Event of Default exists or would
result therefrom or if such payment would result in the
Borrower's having insufficient cash on hand to pay all
Obligations that will be due and owing on the next succeeding
Settlement Date.
(h) BORROWER INDEBTEDNESS. The Borrower will not incur or
permit to exist any Indebtedness or liability on account of deposits except: (A)
Subordinated Loans incurred in accordance with the Sale Agreement and evidenced
by a Subordinated Note, (B) current payables and expense reimbursement
obligations arising under the Transaction Documents and not overdue and (C)
other current accounts payable arising in the ordinary course of business and
not overdue, in an aggregate amount at any time outstanding not to exceed
$10,700.
(i) PROHIBITION ON ADDITIONAL NEGATIVE PLEDGES. No Loan Party
will enter into or assume any agreement (other than this Agreement and the other
Transaction Documents) prohibiting the creation or assumption of any Lien upon
the any Receivables or Related Assets, whether now owned or hereafter acquired,
except as contemplated by the Transaction Documents, or otherwise prohibiting or
restricting any transaction contemplated hereby or by the other Transaction
Documents, and no Loan Party will enter into or assume any agreement creating
any Lien upon the Subordinated Notes.
(j) NAME CHANGE, OFFICES, RECORDS AND BOOKS OF ACCOUNTS. The
Borrower will not change its name, identity or corporate structure (within the
meaning of Section 9-402(7) of any applicable enactment of the UCC) or relocate
its chief executive office or any office where Records are kept unless it shall
have: (i) given the Collateral Agent at least 15 days' prior notice thereof and
(ii) prior to effectiveness of such change, delivered to the Collateral Agent
all financing statements, instruments and other documents requested by the
Collateral Agent in connection with such change or relocation.
(k) MERGERS, CONSOLIDATIONS AND ACQUISITIONS. The Borrower
will not merge into or consolidate with any other Person, or permit any other
Person to merge into or consolidate
26
34
with it, or purchase, lease or otherwise acquire (in one transaction or a series
of transactions) all or substantially all of the assets of any other Person
(whether directly by purchase, lease or other acquisition of all or
substantially all of the assets of such Person or indirectly by purchase or
other acquisition of all or substantially all of the capital stock of such other
Person) other than the acquisition of the Receivables and Related Assets
pursuant to the Sale Agreement.
(l) DISPOSITION OF RECEIVABLES AND RELATED ASSETS. Except
pursuant to this Agreement, the Borrower will not sell, lease, transfer, assign
or otherwise dispose of (in one transaction or in a series of transactions) any
Receivables and Related Assets.
(m) BORROWING BASE. The Borrower will not request any Advance
if, after giving effect thereto, the aggregate outstanding principal balance of
the Loans would exceed the Borrowing Base.
Section 7.4 SEPARATE CORPORATE EXISTENCE OF THE BORROWER. Each
Loan Party hereby acknowledges that Lenders and the Agents are entering into the
transactions contemplated hereby in reliance upon the Borrower's identity as a
legal entity separate from the Servicer and its other Affiliates. Therefore,
each Loan Party shall take all steps specifically required by this Agreement or
reasonably required by any of the Agents to continue the Borrower's identity as
a separate legal entity and to make it apparent to third Persons that the
Borrower is an entity with assets and liabilities distinct from those of its
Affiliates, and is not a division of INTERIM SERVICES or any other Person.
Without limiting the foregoing, each Loan Party will take such actions as shall
be required in order that:
(a) The Borrower will be a limited purpose corporation whose
primary activities are restricted in its Certificate of Incorporation to
purchasing or otherwise acquiring from any of the Originators, owning, holding,
granting security interests in the Collateral, entering into agreements for the
financing and servicing of the Receivables, and conducting such other activities
as it deems necessary or appropriate to carry out its primary activities;
(b) Not less than one member of the Borrower's Board of
Directors (the "INDEPENDENT DIRECTOR") shall be an individual who is not, and
never has been, a direct, indirect or beneficial stockholder, officer, director,
employee, affiliate, associate, material supplier or material customer of
INTERIM SERVICES or any of its Affiliates (other than an Affiliate organized
with a limited purpose charter for the purpose of acquiring receivables or other
financial assets or intangible property). The certificate of incorporation of
the Borrower shall provide that (a) at least one member of the Borrower's Board
of Directors shall be an Independent Director, (b) the Borrower's Board of
Directors shall not approve, or take any other action to cause the filing of, a
voluntary bankruptcy petition with respect to the Borrower unless the
Independent Director shall approve the taking of such action in writing prior to
the taking of such action and (c) the provisions requiring an independent
director and the provision described in clauses (a) and (b) of this paragraph
(ii) cannot be amended without the prior written consent of the Independent
Director;
(c) The Independent Director shall not at any time serve as a
trustee in bankruptcy for the Borrower or any Affiliate thereof;
27
35
(d) Any director, employee, consultant or agent of the
Borrower will be compensated from the Borrower's funds for services provided to
the Borrower. The Borrower will not engage any agents other than its attorneys,
auditors and other professionals and a servicer and any other agent contemplated
by the Transaction Documents for the Collateral, which servicer will be fully
compensated for its services by payment of the Servicer's Fee, and certain
organizational expenses in connection with the formation of the Borrower;
(e) The Borrower will contract with the Servicer to perform
for the Borrower all operations required on a daily basis to service the
Collateral. The Borrower will pay the Servicer the Servicer's Fee pursuant
hereto. The Borrower will not incur any material indirect or overhead expenses
for items shared with INTERIM SERVICES (or any other Affiliate thereof) which
are not reflected in the Servicer's Fee. To the extent, if any, that the
Borrower (or any other Affiliate thereof) shares items of expenses not reflected
in the Servicer's Fee, for legal, auditing and other professional services and
directors' fees, such expenses will be allocated to the extent practical on the
basis of actual use or the value of services rendered, and otherwise on a basis
reasonably related to the actual use or the value of services rendered, it being
understood that INTERIM SERVICES shall pay all expenses relating to the
preparation, negotiation, execution and delivery of the Transaction Documents,
including, without limitation, legal, rating agency and other fees;
(f) The Borrower's operating expenses will not be paid by any
other Loan Party or other Affiliate of the Borrower;
(g) The Borrower will have its own stationery;
(h) The books of account, financial reports and corporate
records of the Borrower will be maintained separately from those of INTERIM
SERVICES and each other Affiliate of the Borrower;
(i) Any financial statements of any Loan Party or Affiliate
thereof which are consolidated to include the Borrower will contain detailed
notes clearly stating that (A) all of the Borrower's assets are owned by the
Borrower, and (B) the Borrower is a separate corporate entity with its own
separate creditors that will be entitled to be satisfied out of the Borrower's
assets prior to any value in the Borrower becoming available to the Borrower's
equity holders; and the accounting records and the published financial
statements of each of the Originators will clearly show that, for accounting
purposes, the Receivables and Related Assets have been sold by such Originator
to the Borrower;
(j) The Borrower's assets will be maintained in a manner that
facilitates their identification and segregation from those of the Servicer and
the other Affiliates;
(k) Each Affiliate of the Borrower will strictly observe
corporate formalities in its dealings with the Borrower, and, except as
permitted pursuant to this Agreement with respect to Collections, funds or other
assets of the Borrower will not be commingled with those of any of its
Affiliates;
28
36
(l) No Affiliate of the Borrower will maintain joint bank
accounts with the Borrower or other depository accounts with the Borrower to
which any such Affiliate (other than in the Borrower's or such Affiliate's
existing or future capacity as the Servicer hereunder or under the Sale
Agreement) has independent access, PROVIDED that prior to demand by the
Collateral Agent pursuant to SECTION 7.1(i) to establish a segregated Collection
Account, Collections may be deposited into general accounts of INTERIM SERVICES,
subject to the obligations of the Servicer hereunder;
(m) No Affiliate of the Borrower shall, directly or
indirectly, name the Borrower or enter into any agreement to name the Borrower
as a direct or contingent beneficiary or loss payee on any insurance policy
covering the property of any Affiliate of the Borrower;
(n) Each Affiliate of the Borrower will maintain arm's length
relationships with the Borrower, and each Affiliate of the Borrower that renders
or otherwise furnishes services or merchandise to the Borrower will be
compensated by the Borrower at market rates for such services or merchandise;
(o) No Affiliate of the Borrower will be, nor will it hold
itself out to be, responsible for the debts of the Borrower or the decisions or
actions in respect of the daily business and affairs of the Borrower. INTERIM
SERVICES and the Borrower will immediately correct any known misrepresentation
with respect to the foregoing and they will not operate or purport to operate as
an integrated single economic unit with respect to each other or in their
dealing with any other entity;
(p) The Borrower will keep correct and complete books and
records of account and minutes of the meetings and other proceedings of its
stockholder and board of directors, as applicable, and the resolutions,
agreements and other instruments of the Borrower will be continuously maintained
as official records by the Borrower; and
(q) Each of the Borrower, on the one hand, and the
Originators, on the other hand, will conduct its business solely in its own
corporate name and in such a separate manner so as not to mislead others with
whom they are dealing.
ARTICLE VIII.
ADMINISTRATION AND COLLECTION
Section 8.1 DESIGNATION OF SERVICER.
(a) INTERIM SERVICES AS INITIAL SERVICER. The servicing,
administering and collection of the Receivables shall be conducted by the Person
designated as Servicer hereunder from time to time in accordance with this
SECTION 8.1. Until the Collateral Agent gives to INTERIM SERVICES a Successor
Notice (as defined in SECTION 8.1(b)), INTERIM SERVICES is hereby designated as,
and hereby agrees to perform the duties and obligations of, Servicer pursuant to
the terms hereof.
(b) SUCCESSOR NOTICE; SERVICER TRANSFER EVENTS. Upon INTERIM
SERVICES' receipt of a notice from both Co-Agents following a Servicer Transfer
Event of the designation of a new Servicer (a "SUCCESSOR NOTICE"), INTERIM
SERVICES agrees that it will terminate its
29
37
activities as Servicer hereunder in a manner that will facilitate the transition
of the performance of such activities to the new Servicer, and the Collateral
Agent (or the designee of the Co-Agents) shall assume each and all of INTERIM
SERVICES' obligations to service and administer such Receivables, on the terms
and subject to the conditions herein set forth, and INTERIM SERVICES shall use
its reasonable best efforts to assist the Collateral Agent (or the Co-Agents'
designee) in assuming such obligations. Without limiting the foregoing, INTERIM
SERVICES agrees, at its expense, to take all actions necessary to provide the
new Servicer with access to all computer software necessary to generate reports
useful in collecting or billing Receivables, solely for use in collecting and
billing Receivables. If INTERIM SERVICES disputes the occurrence of a Servicer
Transfer Event, INTERIM SERVICES may take appropriate action to resolve such
dispute; provided that INTERIM SERVICES must terminate its activities hereunder
as Servicer and allow the newly designated Servicer to perform such activities
on the date specified by the Co-Agents as described above, notwithstanding the
commencement or continuation of any proceeding to resolve the aforementioned
dispute, if the Co-Agents reasonably determine, in good faith, that such
termination is necessary or advisable to protect the Secured Parties' interests
hereunder.
(c) SUBCONTRACTS. So long as INTERIM SERVICES is acting as the
Servicer, it may subcontract with any other Originator for servicing,
administering or collecting all or any portion of the Receivables, PROVIDED,
HOWEVER, that no such subcontract shall relieve INTERIM SERVICES of its primary
liability for performance of its duties as Servicer pursuant to the terms hereof
and any such subservicing arrangement may be terminated at the request of any of
the Agents at any time after a Successor Notice has been given. In addition to
the foregoing, with the prior written consent of the Agents (which consent shall
not be unreasonably withheld or delayed), any Servicer may subcontract with
other Persons for servicing, administering or collecting all or any portion of
the Receivables, PROVIDED, HOWEVER, that no such subcontract shall relieve such
Servicer of its primary liability for performance of its duties as Servicer
pursuant to the terms hereof and any such subservicing arrangement may be
terminated at the request of any of the Agents at any time that such Agent
reasonably determines that such subservicer is not performing adequately.
(d) EXPENSE INDEMNITY AFTER A SERVICER TRANSFER EVENT. In
addition to, and not in lieu of the Servicer's Fee, if INTERIM SERVICES or one
of its Affiliates is replaced as Servicer following a Servicer Transfer Event,
the Borrower shall reimburse the Servicer within 10 Business Days after receipt
of a written invoice, any and all reasonable costs and expenses of the Servicer
incurred in connection with its servicing of the Receivables for the benefit of
the Secured Parties.
30
38
Section 8.2 DUTIES OF SERVICER.
(a) APPOINTMENT; DUTIES IN GENERAL. Each of the Borrower, the
Lenders and the Agents hereby appoints as its agent, the Servicer, as from time
to time designated pursuant to SECTION 8.1, to enforce its rights and interests
in and under the Receivables, the Related Security and the related Contracts
and/or Invoices. The Servicer shall take or cause to be taken all such actions
as may be necessary or advisable to collect each Receivable from time to time,
all in accordance with applicable laws, rules and regulations, with reasonable
care and diligence, and in accordance with the Credit and Collection Policy.
(b) SEGREGATION OF COLLECTIONS. The Servicer shall not be
required (unless otherwise requested by the Collateral Agent) to segregate the
funds constituting such portions of such Collections prior to the remittance
thereof in accordance with Article III. If instructed by the Collateral Agent,
the Servicer shall segregate and deposit into the Collection Account Collections
not later than the second Business Day following receipt by the Servicer of such
Collections in immediately available funds.
(c) MODIFICATION OF RECEIVABLES. INTERIM SERVICES, while it is
the Servicer, may, in accordance with the Credit and Collection Policy, so long
as no Event of Default and no Unmatured Default shall have occurred and be
continuing, extend the maturity or adjust the Unpaid Balance of any Receivable
as INTERIM SERVICES may reasonably determine to be appropriate to maximize
Collections thereof in a manner consistent with the Credit and Collection Policy
(although no such extension or adjustment shall alter the status of such
Receivable as a Defaulted Receivable or a Delinquent Receivable or, in the case
of an adjustment, limit the rights of the Agents or the Lenders under SECTION
3.4).
(d) DOCUMENTS AND RECORDS. Each Loan Party shall deliver to
the Servicer, and the Servicer shall hold in trust for the Borrower and the
Secured Parties, all documents, instruments and records (including, without
limitation, computer tapes or disks) that evidence or relate to Receivables.
(e) CERTAIN DUTIES TO THE BORROWER. The Servicer shall, as
soon as practicable following receipt, turn over to the Borrower (i) that
portion of the Collections which are not required to be turned over to the
Co-Agents, less the Servicer's Fee, and, in the event that neither INTERIM
SERVICES nor any other Loan Party or Affiliate thereof is the Servicer, all
reasonable and appropriate out-of-pocket costs and expenses of the Servicer of
servicing, collecting and administering the Receivables to the extent not
covered by the Servicer's Fee received by it, and (ii) the Collections of any
receivable which is not a Receivable. The Servicer, if other than INTERIM
SERVICES or any other Loan Party or Affiliate thereof, shall, as soon as
practicable upon demand, deliver to the Borrower all documents, instruments and
records in its possession that evidence or relate to Receivables of the Borrower
other than Receivables, and copies of documents, instruments and records in its
possession that evidence or relate to Receivables.
(f) TERMINATION. The Servicer's authorization under this
Agreement shall terminate upon the Final Payout Date.
31
39
(g) POWER OF ATTORNEY. The Borrower hereby grants to the
Servicer an irrevocable power of attorney, with full power of substitution,
coupled with an interest, to take in the name of the Borrower all steps which
are necessary or advisable to endorse, negotiate or otherwise realize on any
writing or other right of any kind held or transmitted by the Borrower or
transmitted or received by Lender (whether or not from the Borrower) in
connection with any Receivable.
Section 8.3 RIGHTS OF THE COLLATERAL AGENT.
(a) NOTICE TO OBLIGORS. At any time when an Event of Default
has occurred and is continuing, the Collateral Agent may notify the Obligors of
Receivables, or any of them, of its security interest, for the benefit of the
Secured Parties, in the Collateral.
(b) NOTICE TO LOCK-BOX BANKS. At any time, either of the
Co-Agents is hereby authorized to direct the Collateral Agent, and the
Collateral Agent is hereby authorized and directed to comply with such
direction, to give notice to the Lock-Box Banks, as provided in the Lock-Box
Agreements, of the transfer to the Collateral Agent of dominion and control over
the Lock-Boxes and related Lock-Box Accounts to which the Obligors of
Receivables make payments. The Borrower and the Servicer hereby transfer to the
Collateral Agent, effective when the Collateral Agent shall give notice to the
Lock-Box Banks as provided in the Lock-Box Agreements, the exclusive dominion
and control over such Lock-Boxes and Lock-Box Accounts, and shall take any
further action that the Collateral Agent may reasonably request to effect such
transfer.
(c) RIGHTS ON SERVICER TRANSFER EVENT. At any time following
the designation of a Servicer other than INTERIM SERVICES pursuant to SECTION
8.1:
(i) The Collateral Agent may direct the Obligors of
Receivables, or any of them, to pay all amounts payable under any Receivable
directly to the Collateral Agent or its designee.
(ii) Any Loan Party shall, at the Collateral Agent's request
and at such Loan Party's expense, give notice of the Collateral Agent's security
interest in the Collateral to each Obligor of Receivables and direct that
payments be made directly to the Collateral Agent or its designee.
(iii) Each Loan Party shall, at the Collateral Agent's
request: (A) assemble all of the documents, instruments and other records
(including, without limitation, computer programs, tapes and disks) which
evidence the Collateral, or which are otherwise necessary or desirable to
collect the Collateral, and make the same available to the successor Servicer at
a place selected by the Collateral Agent, and (B) segregate all cash, checks and
other instruments received by it from time to time constituting Collections in a
manner acceptable to the Collateral Agent and promptly upon receipt, remit all
such cash, checks and instruments, duly endorsed or with duly executed
instruments of transfer, to the successor Servicer.
32
40
(iv) Each of the Loan Parties, the Co-Agents and the Lenders
hereby authorizes the Collateral Agent and grants to the Collateral Agent an
irrevocable power of attorney (which shall terminate on the Final Payout Date),
to take any and all steps in such Person's name and on behalf of such Person
which are necessary or desirable, in the determination of the Collateral Agent,
to collect all amounts due under any and all Receivables, including, without
limitation, endorsing any Loan Party's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Invoices.
Section 8.4 RESPONSIBILITIES OF LOAN PARTIES. Anything herein
to the contrary notwithstanding:
(a) CONTRACTS. Each Loan Party shall remain responsible for
performing all of its obligations (if any) under the Contracts related to the
Receivables and under the related agreements to the same extent as if the
security interest in the Collateral had not been granted hereunder, and the
exercise by the Collateral Agent or its designee of its rights hereunder shall
not relieve any Loan Party from such obligations.
(b) LIMITATION OF LIABILITY. The Agents and the Lenders shall
not have any obligation or liability with respect to any Receivables, Contracts
and/or Invoices related thereto or any other related agreements, nor shall any
of them be obligated to perform any of the obligations of any Loan Party or any
Originator thereunder.
Section 8.5 FURTHER ACTION EVIDENCING THE SECURITY INTEREST.
(a) FURTHER ASSURANCES. Each Loan Party agrees that from time
to time, at its expense, it will promptly execute and deliver all further
instruments and documents, and take all further action that the Collateral Agent
or its designee may reasonably request in order to perfect, protect or more
fully evidence the Collateral Agent's security interest, on behalf of the
Secured Parties, in the Collateral, or to enable the Collateral Agent or its
designee to exercise or enforce any of the Secured Parties' respective rights
hereunder or under any Transaction Document in respect thereof. Without limiting
the generality of the foregoing, each Loan Party will:
(i) upon the request of the Collateral Agent, execute
and file such financing or continuation statements, or
amendments thereto or assignments thereof, and such other
instruments or notices, as may be necessary or appropriate, in
accordance with the terms of this Agreement;
(ii) upon the request of the Collateral Agent after
the occurrence and during the continuance of an Event of
Default, ▇▇▇▇ conspicuously each Invoice evidencing each
Receivable with a legend, acceptable to the Collateral Agent,
evidencing its security interest therein pursuant to this
Agreement; and
(iii) ▇▇▇▇ its master data processing records
evidencing the Collateral with a legend, acceptable to the
Collateral Agent,
33
41
evidencing that a security interest in the Collateral has been
granted pursuant to this Agreement.
(b) ADDITIONAL FINANCING STATEMENTS; CONTINUATION STATEMENTS;
PERFORMANCE BY COLLATERAL AGENT. Each Loan Party hereby authorizes the
Collateral Agent or its designee to file one or more financing or continuation
statements, and amendments thereto and assignments thereof, relative to all or
any of the Collateral now existing or hereafter arising in the name of any Loan
Party. If any Loan Party fails to promptly execute and deliver to the Collateral
Agent any financing statement or continuation statement or amendment thereto or
assignment thereof requested by the Collateral Agent each Loan Party hereby
authorizes the Collateral Agent to execute such statement on behalf of such Loan
Party. If any Loan Party fails to perform any of its agreements or obligations
under this Agreement, the Collateral Agent or its designee may (but shall not be
required to) itself perform, or cause performance of, such agreement or
obligation, and the reasonable expenses of the Collateral Agent or its designee
incurred in connection therewith shall be payable by Loan Parties as provided in
Section 14.5.
Section 8.6 APPLICATION OF COLLECTIONS. Any payment by an
Obligor in respect of any indebtedness owed by it to an Originator or the
Borrower shall, except as otherwise specified by such Obligor or required by the
underlying Contract and/or Invoice or law, be applied, first, as a Collection of
any Receivable or Receivables then outstanding of such Obligor in the order of
the age of such Receivables, starting with the oldest of such Receivables and,
second, to any other indebtedness of such Obligor.
ARTICLE IX.
SECURITY INTEREST
Section 9.1 GRANT OF SECURITY INTEREST. To secure the due and
punctual payment of the Obligations, whether now or hereafter existing, due or
to become due, direct or indirect, or absolute or contingent, including, without
limitation, all Indemnified Amounts, in each case pro rata according to the
respective amounts thereof, the Borrower hereby pledges to the Collateral Agent,
for the benefit of the Secured Parties, and hereby grants to the Collateral
Agent, for the benefit of the Secured Parties, a security interest in, all of
the Borrower's right, title and interest now or hereafter existing in, to and
under (a) all the Receivables and Related Assets, (b) the Sale Agreement and the
other Transaction Documents, (c) the Demand Advances, and (d) all proceeds of
any of the foregoing (collectively, the "COLLATERAL").
Section 9.2 REMEDIES. Upon the occurrence of an Event of
Default, the Collateral Agent, on behalf of the Secured Parties, shall have,
with respect to the Collateral granted pursuant to SECTION 9.1, and in addition
to all other rights and remedies available to Lenders or the Agents under this
Agreement and the other Transaction Documents or other applicable law, all the
rights and remedies of a secured party upon default under the UCC.
Section 9.3 TERMINATION AFTER FINAL PAYOUT DATE. Each of the
Secured Parties hereby authorizes the Collateral Agent, and the Collateral Agent
hereby agrees, promptly after the Final Payout Date to execute and deliver to
the Borrower such UCC-3 termination statements as may be necessary to terminate
the Collateral Agent's security interest in and Lien upon the
34
42
Collateral, all at the Borrower's expense. Upon the Final Payout Date, all
right, title and interest of the Collateral Agent and the Secured Parties in and
to the Collateral shall terminate.
Section 9.4 LIMITATION ON RIGHTS TO COLLATERAL PROCEEDS.
Nothing in this Agreement shall entitle the Secured Parties to receive or retain
proceeds of the Collateral in excess of the aggregate amount of the Obligations
owing to such Secured Party (or to any Indemnified Party claiming through such
Secured Party).
ARTICLE X.
EVENTS OF DEFAULT
Section 10.1 EVENTS OF DEFAULT. The occurrence of any of the
following events shall constitute an "EVENT OF DEFAULT" hereunder:
(a) The Servicer or the Borrower shall fail to make (i) when
and as required to be made by it herein, payments of or deposits of any amount
of principal of any Loan, or (ii) within five days after the same becomes due,
payment of any amount of interest, fees or any other Obligations payable
hereunder or under any other Transaction Document; PROVIDED THAT any interest,
fees or other amounts which are not paid on the due date shall bear interest at
the Default Rate after such due date; or
(b) Any representation or warranty made or deemed to be made
by any Loan Party (or any of its officers) under this Agreement or any other
Transaction Document or any Information Package or other information,
recomputation of the Borrowing Base or other report delivered pursuant hereto
shall prove to have been false or incorrect in any material adverse respect when
made and, if such representation or warranty is capable of being cured, shall
not have been cured within 5 Business Days after (i) notice by any Agent or
Lender of such error to such Loan Party to the applicable Loan Party, or, if
earlier (ii) the date on which any Responsible Officer of either Loan Party
discovers or should have discovered such error; PROVIDED THAT the materiality
threshold in this SECTION 10.1(b) shall not be applicable with respect to any
representation or warranty which itself contains a materiality threshold; or
(c) (i) Any Loan Party fails to perform or observe
any term, covenant or agreement contained in any of SECTIONS 3.1(a),
7.1(i), 7.2(e), 7.2(f), 7.2(g), 7.2(h), 7.3 OR 8.2(b); or
(ii) Any Loan Party fails to perform or observe any
term, covenant or agreement contained in any of SECTIONS 7.1(c), (e) OR
(g), and such default shall continue unremedied for a period of 10
Business Days after the earlier to occur of (A) the date upon which
written notice thereof is given to such Loan Party by any of the Agents
and (B) the date either of the Loan Parties becomes aware thereof; or
(iii) Any Loan Party fails to perform or observe any
other term or covenant contained in this Agreement or any other
Transaction Document, and such default shall continue unremedied for a
period of 30 days after the earlier to occur of (A) the date upon which
written notice thereof is given to such Loan Party by any of the Agents
and (B) the date either of the Loan Parties becomes aware thereof; or
35
43
(d) (i) The Borrower shall (A) fail to pay any
principal or interest, regardless of amount, due in respect of any
Indebtedness of which the aggregate unpaid principal amount is in
excess of $10,700, when and as the same shall become due and payable
(after expiration of any applicable grace period) or (B) fail to
observe or perform any other term, covenant, condition or agreement
(after expiration of any applicable grace period) contained in any
agreement or instrument evidencing or governing any such Indebtedness
if the effect of any failure referred to in this CLAUSE (b) is to
cause, or permit the holder or holders of such Indebtedness or a
trustee on its or their behalf (with or without the giving of notice,
the lapse of time or both) to cause, such Indebtedness to become due
prior to its stated maturity; or
(ii) INTERIM SERVICES or any of its Subsidiaries
(other than the Borrower) (A) shall fail to pay any principal or
interest, regardless of amount, due in respect of any Indebtedness of
which the aggregate unpaid principal amount is in excess of
$10,000,000, when and as the same shall become due and payable (after
expiration of any applicable grace period) or (B) shall fail to observe
or perform any other term, covenant, condition or agreement (after
expiration of any applicable grace period) contained in any agreement
or instrument evidencing or governing any Indebtedness in excess of
$10,000,000 in aggregate principal amount of INTERIM SERVICES or any of
its Subsidiaries (other than the Borrower) if, as a result of such
failure, the holder or holders of the Indebtedness outstanding
thereunder (or an agent or a trustee on their behalf) cause the holder
or holders of such Indebtedness or a trustee on its or their behalf to
cause such Indebtedness to become due prior to its stated maturity; or
(e) An Event of Bankruptcy shall have occurred and remain
continuing with respect to any Loan Party or, if the Servicer is not INTERIM
SERVICES or an Affiliate thereof, with respect to the Servicer; or
(f) The Dilution Ratio at any Cut-Off Date exceeds 2.00%; or
(g) The Default Trigger Ratio at any Cut-Off Date exceeds
8.75%; or
(h) The Delinquency Ratio at any Cut-Off Date exceeds 3.60%;
or
(i) On any Settlement Date, after giving effect to the
payments made under Article II or Article III, the aggregate outstanding
principal balances of the Advances exceed the lesser of the Borrowing Base or
the Aggregate Commitment, the Loans made by Blue Ridge and its Liquidity Banks
exceed the Blue Ridge Allocation Limit, or the Loans made by Falcon and First
Chicago (and any other Falcon Liquidity Bank, if applicable) exceed the Falcon
Allocation Limit; or
(j) There shall have occurred any event which materially
adversely impairs the ability of any of the Originators to originate
receivables; or
(k) A Change in Control shall occur; or
(l) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Internal Revenue Code with regard to any of the
Receivables or Related Assets and
36
44
such lien shall not have been released within seven (7) days, or the Pension
Benefit Guaranty Corporation shall, or shall indicate its intention to, file
notice of a lien pursuant to Section 4068 of the Employee Retirement Income
Security Act of 1974 with regard to any of the Receivables or Related Assets; or
(m) The Collateral Agent, on behalf of the Secured Parties,
for any reason, does not have a valid, perfected first priority interest in the
Receivables and the Related Assets; or
(n) (i) One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Borrower involving in the aggregate a liability (to the extent not covered by
independent third-party insurance as to which the insurer does not dispute
coverage) as to any single or related series of transactions, incidents or
conditions, of $10,700 or more, and the same shall remain unsatisfied, unvacated
and unstayed pending appeal for a period of 30 days after the entry thereof, or
any non-monetary judgment, order or decree is entered against the Borrower which
does or would reasonably be expected to have a Material Adverse Effect, and
there shall be any period of 10 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(ii) One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered
against any of the Originators involving in the aggregate a liability
(to the extent not covered by independent third-party insurance as to
which the insurer does not dispute coverage) as to any single or
related series of transactions, incidents or conditions, of $10,000,000
or more, and the same shall remain unsatisfied, unvacated and unstayed
pending appeal for a period of 30 days after the entry thereof, or any
non-monetary judgment, order or decree is entered against any of the
Originators which does or would reasonably be expected to have a
Material Adverse Effect, and there shall be any period of 10
consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(o) (i) An ERISA Event shall occur with respect to a Pension
Plan or Multiemployer Plan which his resulted or could reasonably be expected to
result in liability of any of the Originators under Title IV of ERISA to such
Pension Plan, such Multiemployer Plan or the PBGC in an aggregate amount in
excess of $1,000,000; (ii) the aggregate amount of Unfunded-Pension Liability
among all Pension Plans at any time exceeds $1,000,000; or (iii) any of the
Originators or any ERISA Affiliate shall fail to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $1,000,000.
37
45
Section 10.2 REMEDIES.
(a) OPTIONAL ACCELERATION. Upon the occurrence of an Event of
Default (other than an Event of Default described in SECTION 10.1(e) with
respect to the Borrower), either of the Co-Agents may by notice to the Borrower
and the other Agents, declare the Termination Date to have occurred and the
Obligations to be immediately due and payable, whereupon the Aggregate
Commitment shall terminate and all Obligations shall become immediately due and
payable.
(b) AUTOMATIC ACCELERATIon. Upon the occurrence of an Event of
Default described in Section 10.1(e) with respect to the Borrower, the
Termination Date shall automatically occur and the Obligations shall be
immediately due and payable.
(c) ADDITIONAL REMEDIES. Upon the Termination Date pursuant to
this SECTION 10.2, the Aggregate Commitment will terminate, no Loans or Advances
thereafter will be made, and the Collateral Agent, on behalf of the Secured
Parties, 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
each applicable jurisdiction and other applicable laws, which rights shall be
cumulative.
ARTICLE XI.
THE AGENTS
Section 11.1 APPOINTMENT.
(a) Each Lender and Co-Agent hereby irrevocably designates and
appoints Wachovia Bank, N.A. as Collateral Agent hereunder, and authorizes the
Collateral Agent to take such action on its behalf under the provisions of the
Transaction Documents and to exercise such powers and perform such duties as are
expressly delegated to the Collateral Agent by the terms of the Transaction
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Collateral Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender,
Liquidity Bank or Co-Agent, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities on the part of the
Collateral Agent shall be read into this Agreement or otherwise exist against
the Collateral Agent.
(b) Each of Blue Ridge and its Liquidity Banks hereby
irrevocably designates and appoints Wachovia Bank, N.A. as its Co-Agent
hereunder, and authorizes such Co-Agent to take such action on its behalf under
the provisions of this Agreement and to exercise such powers and perform such
duties as are expressly delegated to such Co-Agent by the terms of this
Agreement, if any, together with such other powers as are reasonably incidental
thereto. Each of Falcon and its Liquidity Banks hereby irrevocably designates
and appoints The First National Bank of Chicago as its Co-Agent hereunder, and
authorizes such Co-Agent to take such action on its behalf under the provisions
of this Agreement and to exercise such powers and perform such duties as are
expressly delegated to such Co-Agent by the terms of this Agreement, if any,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, no
Co-Agent shall have any duties or responsibilities, except those expressly set
forth herein, or any fiduciary relationship with any
38
46
Lender, any Liquidity Bank or any other Agent, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities on the part of
such Co-Agent shall be read into this Agreement or otherwise exist against such
Co-Agent.
(c) The provisions of this ARTICLE XI are solely for the
benefit of the Agents and the Lenders, and neither of the Loan Parties shall
have any rights as a third-party beneficiary or otherwise under any of the
provisions of this ARTICLE XI, except that this ARTICLE XI shall not affect any
obligations which any Agent or any Lender may have to either of the Loan Parties
under the other provisions of this Agreement. Furthermore, no Lender or
Liquidity Bank shall have any rights as a third-party beneficiary or otherwise
under any of the provisions hereof in respect of a Co-Agent which is not the
Co-Agent for such Person.
(d) In performing its functions and duties hereunder, the
Collateral Agent shall act solely as the agent of the Secured Parties and does
not assume nor shall be deemed to have assumed any obligation or relationship of
trust or agency with or for either of the Loan Parties or any of their
respective successors and assigns. In performing its functions and duties
hereunder, each Co-Agent shall act solely as the agent of its respective Conduit
and its respective Liquidity Bank(s), and does not assume nor shall be deemed to
have assumed any obligation or relationship of trust or agency with or for
either of the Loan Parties, any other Lender, Liquidity Bank or Agent, or any of
their respective successors and assigns.
Section 11.2 DELEGATION OF DUTIES. Each Agent may execute any
of its duties under this Agreement by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. No Agent shall be responsible for the negligence or misconduct of any
agents or attorneys-in-fact selected by it with reasonable care.
Section 11.3 EXCULPATORY PROVISIONS. No Agent nor any of its
directors, officers, agents or employees shall be (i) liable for any action
lawfully taken or omitted to be taken by it or them or any Person described in
SECTION 11.2 under or in connection with this Agreement (except for its, their
or such Person's own bad faith, gross negligence or willful misconduct), or (ii)
responsible in any manner to any of the Lenders or other agents for any
recitals, statements, representations or warranties made by the Borrower
contained in this Agreement or in any certificate, report, statement or other
document referred to or provided for in, or received under or in connection
with, this Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other document furnished
in connection herewith, or for any failure of either of the Loan Parties to
perform its respective obligations hereunder, or for the satisfaction of any
condition specified in ARTICLE V, except receipt of items required to be
delivered to such Agent. No Agent shall be under any obligation to any Lender,
Liquidity Bank or other Agent to ascertain or to inquire as to the observance or
performance of any of the agreements or covenants contained in, or conditions
of, this Agreement, or to inspect the properties, books or records of the Loan
Parties. This SECTION 11.3 is intended solely to govern the relationship between
each Agent, on the one hand, and the Lenders and their respective Liquidity
Banks, on the other.
39
47
Section 11.4 RELIANCE BY AGENTS.
(a) Each Agent shall in all cases be entitled to rely, and
shall be fully protected in relying, upon any note, writing, resolution, notice,
consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Loan Parties), independent accountants and
other experts selected by such Agent. Each Agent shall in all cases be fully
justified in failing or refusing to take any action under this Agreement or any
other document furnished in connection herewith unless it shall first receive
such advice or concurrence of (i) in the case of the Collateral Agent, each of
the Co-Agents (except where another provision of this Agreement specifically
authorizes the Collateral Agent to take action based on the instructions of
either of the Co-Agents) or (ii) in the case of a Co-Agent, such of its Lenders
and Liquidity Banks, as it shall determine to be appropriate under the relevant
circumstances, or it shall first be indemnified to its satisfaction by its
constituent Liquidity Banks against any and all liability, cost and expense
which may be incurred by it by reason of taking or continuing to take any such
action. (b) Any action taken by the Collateral Agent in accordance with Section
11.4(a) shall be binding upon all Lenders and Agents.
(c) Each Co-Agent shall determine with its Conduit and, as
applicable, its Liquidity Banks, the number of such Persons which shall be
required to request or direct such Co-Agent to take action, or refrain from
taking action, under this Agreement on behalf of such Persons and whether any
consent of the rating agencies who rate such Conduit's Commercial Paper Notes is
required (such Persons and, if applicable, rating agencies, a "VOTING BLOCK").
Such Co-Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement in accordance with a request of its
appropriate Voting Block, and such request and any action taken or failure to
act pursuant thereto shall be binding upon all of such Co-Agent's constituents.
(d) Unless otherwise advised in writing by a Co-Agent or by
any Lender or Liquidity Bank on whose behalf such Co-Agent is purportedly
acting, each party to this Agreement may assume that (i) such Co-Agent is acting
for the benefit of each of its constituent Lenders and, as applicable, Liquidity
Banks, as well as for the benefit of each permitted assignee from any such
Person, and (ii) each action taken by such Co-Agent has been duly authorized and
approved by all necessary action on the part of its Voting Block. Each Conduit
(or, with the consent of all other Lenders then existing, any other Lender)
shall have the right to designate a new Co-Agent (which may be itself) to act on
its behalf and on behalf of its assignees and transferees for purposes of this
Agreement by giving to the Agents written notice thereof signed by such
Lender(s) and the newly designated Co-Agent. Such notice shall be effective when
receipt thereof is acknowledged by the retiring Co-Agent, which acknowledgment
shall not be withheld or unreasonably delayed, and thereafter the party named as
such therein shall be Co-Agent for such Lenders under this Agreement. Each
Co-Agent and its Lenders and Liquidity Banks shall agree amongst themselves as
to the circumstances and procedures for removal and resignation of such
Co-Agent.
Section 11.5 NOTICE OF EVENTS OF DEFAULT. No Agent shall be
deemed to have knowledge or notice of the occurrence of any Event of Default or
40
48
Unmatured Default unless such Agent has received notice from another Agent, a
Lender, a Liquidity Bank or a Loan Party referring to this Agreement, stating
that an Event of Default or Unmatured Default has occurred hereunder and
describing such Event of Default or Unmatured Default. In the event that any of
the Agents receives such a notice, it shall promptly give notice thereof to the
other Agents for distribution, in the case of a Co-Agent, to its constituent
Lender(s) and Liquidity Banks. The Collateral Agent shall take such action with
respect to such Event of Default or Unmatured Default as shall be directed by
either of the Co-Agents.
Section 11.6 NON-RELIANCE ON AGENTS AND OTHER LENDERS. Each of
the Lenders expressly acknowledges that no Agent, nor any of such Agent's
officers, directors, employees, agents, attorneys-in-fact or affiliates has made
any representations or warranties to it and that no act by any Agent hereafter
taken, including, without limitation, any review of the affairs of the Loan
Parties, shall be deemed to constitute any representation or warranty by such
Agent. Each of the Lenders also represents and warrants to the Agents and the
other Lenders that it has, independently and without reliance upon any such
Person (or any of their Affiliates) and based on such documents and information
as it has deemed appropriate, made its own appraisal of and investigation into
the business, operations, property, prospects, financial and other conditions
and creditworthiness of the Loan Parties and made its own decision to enter into
this Agreement. Each of the Lenders also represents that it will, independently
and without reliance upon any Agent or any other Liquidity Bank or Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement, and to make such investigation
as it deems necessary to inform itself as to the business, operations, property,
prospects, financial and other condition and creditworthiness of the Loan
Parties. None of the Agents or the Lenders, nor any of their respective
Affiliates, shall have any duty or responsibility to provide any party to this
Agreement with any credit or other information concerning the business,
operations, property, prospects, financial and other condition or
creditworthiness of the Loan Parties which may come into the possession of such
Person or any of its respective officers, directors, employees, agents,
attorneys-in-fact or affiliates, except that each of the Co-Agents shall
promptly distribute to its related Conduit (and, as applicable, its Liquidity
Banks), copies of financial and other information expressly provided to such
Co-Agent by either of the Loan Parties pursuant to this Agreement for
distribution to the Agents and/or Lenders.
Section 11.7 INDEMNIFICATION OF AGENTS.
(a) Each Liquidity Bank agrees to indemnify the Collateral
Agent and its officers, directors, employees, representatives and agents (to the
extent not reimbursed by the Loan Parties and without limiting the obligation of
the Loan Parties to do so), ratably in accordance with their respective
Percentages or Loans, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and disbursements of counsel for the Collateral Agent or
such Person in connection with any investigative, administrative or judicial
proceeding commenced or threatened, whether or not the Collateral Agent in its
capacity as Collateral Agent or such Person shall be designated a party thereto)
that may at any time be imposed on, incurred by or asserted against the
Collateral Agent or such Person as a result of, or arising out of, or in any way
related to or by reason of, any of the transactions contemplated hereunder or
the execution, delivery or performance of this Agreement
41
49
or any other document furnished in connection herewith (but excluding any such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the bad faith, gross
negligence or willful misconduct of the Collateral Agent or such Person as
finally determined by a court of competent jurisdiction).
(b) Each Liquidity Bank agrees to indemnify its Co-Agent and
such Co-Agent's officers, directors, employees, representatives and agents (to
the extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so), ratably in accordance with their respective Percentages
or Loans, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including, without limitation, the fees and
disbursements of counsel for such Co-Agent or such Person in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not such Co-Agent in its capacity as Co-Agent or such Person shall be
designated a party thereto) that may at any time be imposed on, incurred by or
asserted against such Co-Agent or such Person as a result of, or arising out of,
or in any way related to or by reason of, any of the transactions contemplated
hereunder or the execution, delivery or performance of this Agreement or any
other document furnished in connection herewith (but excluding any such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting solely from the bad faith, gross
negligence or willful misconduct of such Co-Agent or such Person as finally
determined by a court of competent jurisdiction).
Section 11.8 AGENTS IN THEIR INDIVIDUAL CAPACITIES. Each of
the Agents in its individual capacity and its affiliates may make loans to,
accept deposits from and generally engage in any kind of business with the Loan
Parties and their Affiliates as though such Agent were not an Agent hereunder.
With respect to its Loans, if any, pursuant to this Agreement, each Agent shall
have the same rights and powers under this Agreement as any Lender and may
exercise the same as though it were not an Agent, and the terms "LENDER" and
"LENDERS" shall include each of the Agents in their individual capacities.
Section 11.9 SUCCESSOR COLLATERAL AGENT. The Collateral Agent,
upon five (5) days' notice to the Borrower, the Lenders and the Co-Agents, may
voluntarily resign and may be removed at any time, with or without cause, by the
Co-Agents; PROVIDED, HOWEVER, that Wachovia Bank, N.A. shall not voluntarily
resign as the Collateral Agent so long as any of Blue Ridge's Liquidity Banks'
respective Commitments remain in effect or Blue Ridge has any outstanding Loans
hereunder and, PROVIDED, FURTHER, that if Wachovia Bank, N.A. voluntarily
resigns or is removed as the Collateral Agent at a time when Falcon has
outstanding Loans or Falcon's Liquidity Banks have outstanding Loans or
Commitments, First Chicago shall succeed to Wachovia Bank, N.A. as Collateral
Agent. In addition, if Blue Ridge's Liquidity Banks cease to have Commitments
hereunder and neither Blue Ridge nor any of its other Liquidity Banks has any
outstanding Loans, First Chicago shall succeed to Wachovia Bank, N.A. as
Collateral Agent. If any Collateral Agent (other than Wachovia Bank, N.A.) shall
voluntarily resign or be removed as Collateral Agent under this Agreement, then
the Co-Agents during such five-day period shall appoint, with the consent of the
Borrower from among the remaining Agents and Lenders, a successor collateral
agent, whereupon such successor collateral agent shall succeed to the rights,
powers and duties of the Collateral Agent and the term "COLLATERAL AGENT" shall
mean such successor agent, effective upon its appointment, and the former
Collateral Agent's rights, powers
42
50
and duties as Collateral Agent shall be terminated, without any other or further
act or deed on the part of such former Collateral Agent or any of the parties to
this Agreement. Upon resignation or replacement of any Collateral Agent in
accordance with this Section 11.9, the retiring Collateral Agent shall execute
such UCC-3 assignments and amendments, and assignments and amendments of the
Transaction Documents, as may be necessary to give effect to its replacement by
a successor Collateral Agent. After any retiring Collateral Agent's resignation
hereunder as Collateral Agent, the provisions of this ARTICLE XI and ARTICLE
XIII shall inure to its benefit as to any actions taken or omitted to be taken
by it while it was Collateral Agent under this Agreement.
Section 11.10 AGENTS' CONFLICT WAIVERS.
(a) Wachovia acts, or may in the future act, (i) as
administrative agent for Blue Ridge, (ii) as issuing and paying agent for Blue
Ridge's Commercial Paper Notes, (iii) to provide credit or liquidity enhancement
for the timely payment for Blue Ridge's Commercial Paper Notes and (iv) to
provide other services from time to time for Blue Ridge (collectively, the
"WACHOVIA ROLES"). Without limiting the generality of SECTIONS 11.1 AND 11.8,
each Agent, Lender and Liquidity Bank hereby acknowledges and consents to any
and all Wachovia Roles and agrees that in connection with any Wachovia Role,
Wachovia may take, or refrain from taking, any action which it, in its
discretion, deems appropriate, including, without limitation, in its role as
administrative agent for Blue Ridge, the giving of notice to Blue Ridge's
Liquidity Banks of a mandatory purchase pursuant to Blue Ridge's Liquidity
Agreement, and hereby acknowledges that neither Wachovia nor any of its
Affiliates has any fiduciary duties hereunder to any Lender (other than Blue
Ridge) or to any of Blue Ridge's Liquidity Banks arising out of any Wachovia
Roles.
(b) First Chicago acts, or may in the future act, (i) as
administrative agent for Falcon, (ii) as issuing and paying agent for Falcon's
Commercial Paper, (iii) to provide credit or liquidity enhancement for the
timely payment for Falcon's Commercial Paper and (iv) to provide other services
from time to time for Falcon (collectively, the "FIRST CHICAGO ROLES"). Without
limiting the generality of SECTIONS 11.1 and 11.8, each of the Agents and the
Lenders hereby acknowledges and consents to any and all First Chicago Roles and
agrees that in connection with any First Chicago Role, First Chicago may take,
or refrain from taking, any action which it, in its discretion, deems
appropriate, including, without limitation, in its role as administrative agent
for Falcon, the giving of notice to Falcon's Liquidity Banks of a mandatory
purchase pursuant to Falcon's Liquidity Agreement, and hereby acknowledges that
neither First Chicago nor any of its Affiliates has any fiduciary duties
hereunder to any Lender (other than Falcon) or to any of Falcon's Liquidity
Banks arising out of any First Chicago Roles.
Section 11.11 UCC FILINGS. Each of the Secured Parties hereby
expressly recognizes and agrees that the Collateral Agent may be listed as the
assignee or secured party of record on the various UCC filings required to be
made under the Transaction Documents in order to perfect their respective
interests in the Collateral, that such listing shall be for administrative
convenience only in creating a record or nominee holder to take certain actions
hereunder on behalf of the Secured Parties and that such listing will not affect
in any way the status of the Secured Parties as the true parties in interest
with respect to the Collateral. In addition, such
43
51
listing shall impose no duties on the Collateral Agent other than those
expressly and specifically undertaken in accordance with this ARTICLE XI.
ARTICLE XII.
ASSIGNMENTS AND PARTICIPATIONS
Section 12.1 RESTRICTIONS ON ASSIGNMENTS, ETC.
(a) No Loan Party may assign its rights, or delegate its
duties hereunder or any interest herein without the prior written consent of
each of the Agents; PROVIDED, HOWEVER, that the foregoing shall not be deemed to
restrict:
(i) INTERIM SERVICES' right, prior to delivery of a Successor
Notice, to delegate its duties as Servicer to other Originators,
provided that INTERIM SERVICES shall remain primarily liable for the
performance or non-performance of such duties, or
(ii) any Originator(s), whether or not it is acting as the
Servicer or a sub-servicer, from entering into a Permitted
Restructuring.
(b) Each of the Conduits may, at any time, assign all or any
portion of a Loan, or sell participations therein, to its Liquidity Banks (or to
its Co-Agent for the ratable benefit of its Liquidity Banks).
(c) In addition to, and not in limitation of, assignments and
participations described in SECTION 12.1(b):
(i) in the event that any Liquidity Bank becomes a Downgraded
Liquidity Bank, such Downgraded Liquidity Bank shall give prompt
written notice of its Downgrading Event to its Co-Agent and to the
Borrower. Within 5 Business Days after the Borrower's receipt of such
notice, the Borrower may propose an Eligible Assignee who is willing to
accept an assignment of, and to assume, such Downgraded Liquidity
Bank's rights and obligations under this Agreement and under its
applicable Liquidity Agreement. In the event that the Borrower fails to
propose such an Eligible Assignee within such 5 Business Day period, or
such Eligible Assignee does not execute and deliver assignment and
assumption documents reasonably acceptable to such Downgraded Liquidity
Bank and its Co-Agent and pays the Downgraded Liquidity Bank's
Obligations in full, in each case, not later than 5:00 p.m. (New York
City time) on the 10th Business Day following the Borrower's receipt of
notice of such Downgrading Event, such Co-Agent may identify an
Eligible Assignee without the Borrower's consent, and the Downgraded
Liquidity Bank shall promptly assign its rights and obligations to the
Eligible Assignee designated by its Co-Agent against payment in full of
its Obligations;
(ii) each of the Lenders may assign all or any portion of its
Loans and, if applicable its Commitment under this Agreement to any
Eligible
44
52
Assignee with the prior written consent of the Borrower, which consent
shall not be unreasonably withheld or delayed; and
(iii) each of the Lenders may, with the prior written consent
of the Borrower, sell participations in all or any portion of their
respective rights and obligations in, to and under the Transaction
Documents and the Obligations in accordance with SECTIONS 12.2 and
14.7.
In the event that the Borrower reasonably withholds its consent to a proposed
assignment or participation under SECTION 12.1(c)(ii) or SECTION 12.1(c)(iii),
the Borrower will have 60 days from the date on which it first received notice
of a proposed assignment or participation to propose an Eligible Assignee as an
alternate assignee or participant, as the case may be, to the Lender who
proposed to make such assignment or to sell such participation (each, a
"PROPOSING LENDER") and to its Co-Agent. Provided that (x) such proposed
Eligible Assignee is, in the case of a participation, reasonably acceptable to
the Proposing Lender, and (y) such proposed Eligible Assignee, in the case of an
assignment or a participation, executes and delivers an assignment and
assumption agreement or a participation agreement, as the case may be,
reasonably acceptable to the Proposing Lender and its Co-Agent and, if
applicable, pays the Proposing Lender the amounts due to it under its assignment
or participation agreement, as applicable, in each case, not later than 5:00
p.m. (New York City time) on such 60th day, the Proposing Lender shall be
obliged to make the proposed assignment or sell the proposed participation to
the Eligible Assignee proposed by the Borrower against payment in full of its
Obligations, if any, that are being assigned or participated. In the event the
Borrower fails to propose an Eligible Assignee, or the proposed Eligible
Assignee fails to execute and deliver documents or to pay for the assigned
Obligations, by such 60th day, then the Proposing Lender may proceed to enter
into the proposed assignment or participation with the Eligible Assignee or
participant originally identified by the Proposing Lender.
Section 12.2 RIGHTS OF ASSIGNEES AND PARTICIPANTS.
(a) Upon the assignment by a Lender in accordance with SECTION
12.1(b) OR (c), the Eligible Assignee(s) receiving such assignment shall have
all of the rights of such Lender with respect to the Transaction Documents and
the Obligations (or such portion thereof as has been assigned).
(b) In no event will the sale of any participation interest in
any Lender's or any Eligible Assignee's rights under the Transaction Documents
or in the Obligations relieve the seller of such participation of its
obligations, if any, hereunder or, if applicable, under the applicable Liquidity
Agreement.
45
53
Section 12.3 TERMS AND EVIDENCE OF ASSIGNMENT. Any assignment
to any Eligible Assignee(s) pursuant to SECTION 1.8, 12.1(b) or 12.1(c) shall be
upon such terms and conditions as the assigning Lender and its Co-Agent, on the
one hand, and the Eligible Assignee, on the other, may mutually agree, and shall
be evidenced by such instrument(s) or document(s) as may be satisfactory to such
Lender, its Co-Agent and the Eligible Assignee(s). Any assignment made in
accordance with the terms of the Article XII shall relieve the assigning Lender
of its obligations, if any, under this Agreement (and, if applicable, its
Liquidity Agreement) to the extent assigned.
ARTICLE XIII.
INDEMNIFICATION
Section 13.1 INDEMNITIES BY THE BORROWER.
(a) GENERAL INDEMNITY. Without limiting any other rights which
any such Person may have hereunder or under applicable law, the Borrower hereby
agrees to indemnify each of the Agents, the Lenders, the Liquidity Banks, each
of their respective Affiliates, and all successors, transferees, participants
and assigns and all officers, directors, shareholders, controlling persons,
employees and agents of any of the foregoing (each, an "INDEMNIFIED PARTY"),
forthwith on demand, from and against any and all damages, losses, claims,
liabilities and related costs and expenses, including attorneys' fees 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 relating to the Transaction Documents, the Obligations or the Collateral,
EXCLUDING, HOWEVER, (i) Indemnified Amounts to the extent determined by a court
of competent jurisdiction to have resulted from bad faith, gross negligence or
willful misconduct on the part of such Indemnified Party or (ii) recourse
(except as otherwise specifically provided in this Agreement) for Indemnified
Amounts to the extent the same includes losses in respect of Receivables which
are uncollectible on account of the insolvency, bankruptcy or lack of
creditworthiness of the related Obligor. Without limiting the foregoing, the
Borrower shall indemnify each Indemnified Party for Indemnified Amounts arising
out of or relating to:
(A) the creation of any Lien on, or transfer by any
Loan Party of any interest in, the Collateral other than the
sale of Receivables and related property by the Originators to
the Borrower pursuant to the Sale Agreement and the grant of
by the Borrower of a security interest in the Collateral to
the Collateral Agent pursuant to SECTION 9.1;
(B) any representation or warranty made by any Loan
Party (or any of its officers) under or in connection with any
Transaction Document, any Information Package or any other
information or report delivered by or on behalf of any Loan
Party pursuant hereto, which shall have been false, incorrect
or misleading in any respect when made or deemed made or
delivered, as the case may be;
46
54
(C) the failure by any Loan Party to comply with any
applicable law, rule or regulation with respect to any
Receivable or the related Contract and/or Invoice, or the
nonconformity of any Receivable or the related Contract and/or
Invoice with any such applicable law, rule or regulation;
(D) the failure to vest and maintain vested in the
Collateral Agent, for the benefit of the Secured Parties, a
valid and perfected first priority security interest in the
Collateral, free and clear of any other Lien, other than a
Lien arising solely as a result of an act of one of the
Secured Parties, now or at any time thereafter;
(E) the failure to file, or any delay in filing,
financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other
applicable laws with respect to any Collateral;
(F) any dispute, claim, offset or defense (other than
discharge in bankruptcy) of the Obligor to the payment of any
Receivable (including, without limitation, a defense based on
such Receivables or the related Contract and/or Invoice not
being a legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms), or any
other claim resulting from the sale of the services related to
such Receivable or the furnishing or failure to furnish such
services;
(G) any Rebill or other matter described in
SECTION 3.4;
(H) any failure of any Loan Party, as the Borrower,
the Servicer or otherwise, to perform its duties or
obligations in accordance with the provisions of this
Agreement or the other Transaction Documents to which it is a
party;
(I) any claim of breach by any Loan Party of any
related Contract and/or Invoice with respect to any
Receivable;
(J) any tax or governmental fee or charge (but not
including taxes upon or measured by net income), all interest
and penalties thereon or with respect thereto, and all
out-of-pocket costs and expenses, including the reasonable
fees and expenses of counsel in defending against the same,
which may arise by reason of the Collateral Agent's security
interest in the Collateral;
(K) any failure of the Borrower, any of the
Originators, the Servicer or any Person to whom the Servicer
delegates any servicing responsibilities to be Year 2000
Compliant;
47
55
(L) the commingling of Collections of Receivables at
any time with other funds;
(M) any investigation, litigation or proceeding
related to or arising from this Agreement or any other
Transaction Document, the transactions contemplated hereby or
thereby, the use of the proceeds of any Loan, the security
interest in the Receivables and Related Assets or any other
investigation, litigation or proceeding relating to the
Borrower or any of the Originators in which any Indemnified
Party becomes involved as a result of any of the transactions
contemplated hereby or thereby (other than an investigation,
litigation or proceeding (1) relating to a dispute solely
amongst the Lenders (or certain Lenders) and one of the Agents
or (2) excluded by SECTION 13.1(a));
(N) any inability to litigate any claim against any
Obligor in respect of any Receivable as a result of such
Obligor being immune from civil and commercial law and suit on
the grounds of sovereignty or otherwise from any legal action,
suit or proceeding;
(O) the occurrence of any Event of Default of the
type described in SECTION 10.1(e); or
(P) any loss incurred by any of the Secured Parties
as a result of the inclusion in the Borrowing Base of
Receivables owing from any single Obligor and its Affiliated
Obligors which causes the aggregate Unpaid Balance of all such
Receivables to exceed the applicable Obligor Concentration
Limit.
(b) CONTEST OF TAX CLAIM; AFTER-TAX BASIS. If any Indemnified
Party shall have notice of any attempt to impose or collect any tax or
governmental fee or charge for which indemnification will be sought from any
Loan Party under SECTION 13.1(a)(xi), such Indemnified Party shall give prompt
and timely notice of such attempt to the Borrower and the Borrower shall have
the right, at its expense, to participate in any proceedings resisting or
objecting to the imposition or collection of any such tax, governmental fee or
charge. Indemnification hereunder shall be in an amount necessary to make the
Indemnified Party whole after taking into account any tax consequences to the
Indemnified Party of the payment of any of the aforesaid taxes (including any
deduction) and the receipt of the indemnity provided hereunder or of any refund
of any such tax previously indemnified hereunder, including the effect of such
tax, deduction or refund on the amount of tax measured by net income or profits
which is or was payable by the Indemnified Party.
(c) CONTRIBUTION. If for any reason the indemnification
provided above in this SECTION 13.1 (and subject to the exceptions set forth
therein) is unavailable to an Indemnified Party or is insufficient to hold an
Indemnified Party harmless, then the Borrower shall contribute to the amount
paid or payable by such Indemnified Party as a result of such loss, claim,
damage
48
56
or liability in such proportion as is appropriate to reflect not only the
relative benefits received by such Indemnified Party on the one hand and the
Borrower on the other hand but also the relative fault of such Indemnified Party
as well as any other relevant equitable considerations.
Section 13.2 INDEMNITIES BY SERVICER. Without limiting any
other rights which any Indemnified Party may have hereunder or under applicable
law, the Servicer hereby agrees to indemnify each of the Indemnified Parties
forthwith on demand, from and against any and all Indemnified Amounts awarded
against or incurred by any of them arising out of or relating to the Servicer's
performance of, or failure to perform, any of its obligations under or in
connection with any Transaction Document, or any representation or warranty made
by the Servicer (or any of its officers) under or in connection with any
Transaction Document, any Information Package or any other information or report
delivered by or on behalf of the Servicer, which shall have been false,
incorrect or misleading in any material respect when made or deemed made or
delivered, as the case may be, or the failure of the Servicer to comply with any
applicable law, rule or regulation with respect to any Receivable or the related
Contract and/or Invoice. Notwithstanding the foregoing, in no event shall any
Indemnified Party be awarded any Indemnified Amounts (a) to the extent
determined by a court of competent jurisdiction to have resulted from gross
negligence or willful misconduct on the part of such Indemnified Party or (b) as
recourse for Indemnified Amounts to the extent the same includes losses in
respect of Receivables which are uncollectible on account of the insolvency,
bankruptcy or lack of creditworthiness of the related Obligor.
If for any reason the indemnification provided above in this
SECTION 13.2 (and subject to the exceptions set forth therein) is unavailable to
an Indemnified Party or is insufficient to hold an Indemnified Party harmless,
then the Servicer shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, claim, damage or liability in such
proportion as is appropriate to reflect not only the relative benefits received
by such Indemnified Party on the one hand and the Servicer on the other hand but
also the relative fault of such Indemnified Party as well as any other relevant
equitable considerations.
ARTICLE XIV.
MISCELLANEOUS
Section 14.1 AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement nor consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be in writing
and signed by each of the Loan Parties, the Collateral Agent, and, with the
consent of their respective Voting Blocks, the Co-Agents, and any such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. The Loan Parties acknowledge that, before entering into
such an amendment or granting such a waiver or consent, each of the Co-Agents
will be required to obtain the approval of their respective Voting Blocks.
Section 14.2 NOTICES, ETC. All notices and other
communications provided for hereunder shall, unless otherwise stated herein, be
in writing (including facsimile communication) and shall be personally delivered
or sent by express mail or courier or by certified mail, postage prepaid, or by
facsimile, to the intended party at the address or facsimile number of such
party set forth on SCHEDULE 14.2 or at such other address or facsimile number as
49
57
shall be designated by such party in a written notice to the other parties
hereto. All such notices and communications shall be effective, (a) if
personally delivered or sent by express mail or courier or if sent by certified
mail, when received, and (b) if transmitted by facsimile, when sent, receipt
confirmed by telephone or electronic means.
Section 14.3 NO WAIVER; REMEDIES. No failure on the part of
any Agent or any of the Secured Parties to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law. Without limiting
the foregoing, each of the Agents, the Lenders and the Liquidity Banks is hereby
authorized by the Borrower at any time and from time to time, to the fullest
extent permitted by law, to set off and apply to payment of any Obligations that
are then due and owing any and all deposits (general or special, time or demand
provisional or final) at any time held and other indebtedness at any time owing
by such Person to or for the credit or the account of the Borrower.
Section 14.4 BINDING EFFECT; SURVIVAL. This Agreement shall be
binding upon and inure to the benefit of each the Loan Parties, the Agents, the
Lenders and their respective successors and assigns, and the provisions of
SECTION 4.2 and ARTICLE XIII shall inure to the benefit of the Affected Parties
and the Indemnified Parties, respectively, and their respective successors and
assigns; PROVIDED, HOWEVER, nothing in the foregoing shall be deemed to
authorize any assignment not permitted by SECTION 12.1. This Agreement shall
create and constitute the continuing obligations of the parties hereto in
accordance with its terms, and shall remain in full force and effect until the
Final Payout Date. The rights and remedies with respect to any breach of any
representation and warranty made by the Borrower pursuant to ARTICLE VI and the
indemnification and payment provisions of ARTICLE XIII and SECTIONS 4.2, 14.5,
14.6, 14.7, 14.8 and 14.15 shall be continuing and shall survive any termination
of this Agreement.
Section 14.5 COSTS, EXPENSES AND TAXES. In addition to their
obligations under the other provisions of this Agreement, the Loan Parties
jointly and severally agree to pay:
(a) within 15 Business Days after receipt of a written invoice
therefor: all reasonable out-of-pocket costs and expenses incurred by the
Agents, in connection with (i) the negotiation, preparation, execution and
delivery of this Agreement, the other Transaction Documents or the Liquidity
Agreements (subject to the limitations set forth in the Fee Letters), or (ii)
the administration of the Transaction Documents prior to an Event of Default
including, without limitation, (A) the reasonable fees and expenses of a single
law firm acting as counsel to the Agents and the Lenders incurred in connection
with any of the foregoing, and (B) subject to the limitations set forth in the
Fee Letters and in SECTION 7.1(c), the reasonable fees and expenses of
independent accountants incurred in connection with any review of any Loan
Party's books and records either prior to or after the execution and delivery
hereof;
(b) within 15 Business Days after receipt of a written invoice
therefor: all reasonable out-of-pocket costs and expenses (including, without
limitation, the reasonable fees and expenses of counsel and independent
accountants) incurred by each of the Lenders, the Agents and the Liquidity Banks
in connection with the negotiation, preparation, execution and delivery of any
amendment or consent to, or waiver of, any provision of the Transaction
Documents which is requested or proposed by any Loan Party (whether or not
consummated), the administration of the Transaction Documents following an Event
of Default (or following a waiver of or consent to any Event of Default), or the
enforcement by any of the foregoing Persons of, or any actual or claimed breach
of, this Agreement or any of the other Transaction
50
58
Documents, including, without limitation, (i) the reasonable fees and expenses
of counsel to any of such Persons incurred in connection with any of the
foregoing or in advising such Persons as to their respective rights and remedies
under any of the Transaction Documents in connection with any of the foregoing,
and (ii) the reasonable fees and expenses of independent accountants incurred in
connection with any review of any Loan Party's books and records or valuation of
the Receivables and Related Assets; and
(c) upon demand: all stamp and other taxes and fees payable or
determined to be payable in connection with the execution, delivery, filing and
recording of this Agreement or the other Transaction Documents (and Loan
Parties, jointly and severally agree to indemnify each Indemnified Party against
any liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and fees).
Section 14.6 NO PROCEEDINGS. Each of the parties hereto hereby
agrees that it will not institute against the Borrower, Blue Ridge or Falcon, or
join any Person in instituting against the Borrower, Blue Ridge or Falcon, any
insolvency proceeding (namely, any proceeding of the type referred to in the
definition of Event of Bankruptcy) so long as any Commercial Paper Notes or
other senior Indebtedness issued by Blue Ridge or Falcon shall be outstanding or
there shall not have elapsed one year plus one day since the last day on which
any such Commercial Paper Notes or other senior Indebtedness shall have been
outstanding.
Section 14.7 CONFIDENTIALITY OF BORROWER INFORMATION.
(a) CONFIDENTIAL BORROWER INFORMATION. Each party hereto
(other than the Loan Parties) acknowledges that certain of the information
provided to such party by or on behalf of Loan Parties in connection with this
Agreement and the transactions contemplated hereby is or may be confidential,
and each such party severally agrees that, unless INTERIM SERVICES shall
otherwise agree in writing, and except as provided in SUBSECTION (b), such party
will not disclose to any other person or entity:
(i) any information regarding, or copies of, any nonpublic
financial statements, reports, schedules and other information furnished by any
Loan Party to the Co-Agents and the Lenders (A) prior to the date hereof in
connection with such party's due diligence relating to Loan Parties and the
transactions contemplated hereby, or (B) pursuant to SECTION 3.1, 5.1, 6.1(i),
6.1(m), 7.1(c) or 7.2, or
(ii) any other information regarding any Loan Party which is
designated by any Loan Party to such party in writing as confidential
(the information referred to in CLAUSES (i) AND (ii) above, whether furnished by
any Loan Party or any attorney for or other representative thereof (each, a
"BORROWER INFORMATION PROVIDER"), is collectively referred to as the "BORROWER
INFORMATION"); PROVIDED, HOWEVER, "BORROWER INFORMATION" shall not include any
information which is or becomes generally available to the
51
59
general public or to such party on a nonconfidential basis from a source other
than any Borrower Information Provider, or which was known to such party on a
nonconfidential basis prior to its disclosure by any Borrower Information
Provider.
(b) DISCLOSURE. Notwithstanding SUBSECTION (a), each party may
disclose any Borrower Information:
(i) to any of such party's attorneys and auditors,
(ii) to any dealer or placement agent for such party's
Commercial Paper Notes, who (A) in the good faith belief of such party, has a
need to know the Borrower Information, (B) is informed by such party of the
confidential nature of the Borrower Information and the terms of this SECTION
14.7 and (C) has agreed in writing to be bound by the provisions of this SECTION
14.7,
(iii) to any Liquidity Bank (whether or not on the date of
disclosure, such Liquidity Bank continues to be an Eligible Assignee), to any
other actual or potential permitted assignee or participant permitted under
SECTION 12.1 who has agreed to be bound by the provisions of this SECTION 14.7,
(iv) to any rating agency that maintains a rating for such
party's Commercial Paper Notes or is considering the issuance of such a rating,
for the purposes of reviewing the credit of any Lender in connection with such
rating,
(v) to any other party to this Agreement (and any independent
attorneys and auditors of such party), for the purposes contemplated hereby,
(vi) as may be required by any municipal, state, federal or
other regulatory body having or claiming to have jurisdiction over such party,
in order to comply with any law, order, regulation, regulatory request or ruling
applicable to such party,
(vii) subject to SUBSECTION (C), in the event such party is
legally compelled (by interrogatories, requests for information or copies,
subpoena, civil investigative demand or similar process) to disclose such
Borrower Information,
(viii) to any entity that provides a surety bond or other
credit enhancement to either of the Conduits, or
(ix) in connection with the enforcement of this Agreement or
any other Transaction Document.
In addition, each of the Lenders and the Agents may disclose on a "no name"
basis to any actual or potential investor in Commercial Paper Notes information
regarding the nature of this Agreement, the basic terms hereof (including
without limitation the amount and nature of the Aggregate Commitment and the
Advances), the nature, amount and status of the Receivables,
52
60
and the current and/or historical ratios of losses to liquidations and/or
outstandings with respect to the Receivables.
(c) LEGAL COMPULSION. In the event that any party hereto
(other than any Loan Party) or any of its representatives is requested or
becomes legally compelled (by interrogatories, requests for information or
documents, subpoena, civil investigative demand or similar process) to disclose
any of the Borrower Information, such party will (or will cause its
representative to):
(i) provide INTERIM SERVICES with prompt written notice so
that (A) INTERIM SERVICES may seek a protective order or other appropriate
remedy, or (B) INTERIM SERVICES may, if it so chooses, agree that such party (or
its representatives) may disclose such Borrower Information pursuant to such
request or legal compulsion; and
(ii) unless INTERIM SERVICES agrees that such Borrower
Information may be disclosed, make a timely objection to the request or
compulsion to provide such Borrower Information on the basis that such Borrower
Information is confidential and subject to the agreements contained in this
SECTION 14.7.
In the event such protective order or remedy is not obtained,
or INTERIM SERVICES agrees that such Borrower Information may be disclosed, such
party will furnish only that portion of the Borrower Information which (in such
party's good faith judgment) is legally required to be furnished and will
exercise reasonable efforts to obtain reliable assurance that confidential
treatment will be afforded the Borrower Information.
(d) SURVIVAL. This SECTION 14.7 shall survive termination of
this Agreement.
Section 14.8 CONFIDENTIALITY OF PROGRAM INFORMATION.
(a) CONFIDENTIAL INFORMATION. Each party hereto acknowledges
that each of the Conduits and its Co-Agent regard the structure of the
transactions contemplated by this Agreement to be proprietary, and each such
party agrees that:
(i) it will not disclose without the prior consent of the
applicable Conduit or its Co-Agent (other than to the directors, employees,
auditors, counsel or affiliates (collectively, "REPRESENTATIVES") of such party,
each of whom shall be informed by such party of the confidential nature of the
Program Information (as defined below) and of the terms of this SECTION 14.8):
(A) any information regarding the pricing in, or copies of, this Agreement, the
Liquidity Agreements or the Fee Letters or any transaction contemplated hereby
or thereby, (B) any information regarding the organization, business or
operations of such Conduit generally or the services performed by such Conduit's
Co-Agent for such Conduit, or (C) any information which is furnished by such
Conduit or its Co-Agent to such party and which is designated by such Conduit or
its Co-Agent to such party in writing or otherwise as confidential or not
otherwise available to the general public (the information referred to in
CLAUSES (A), (B) and (C) is collectively referred to as the "PROGRAM
INFORMATION"); PROVIDED, HOWEVER, that such party may disclose any such Program
Information (I) as may be required by any
53
▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ or other regulatory body having or claiming to have
jurisdiction over such party, including, without limitation, the SEC, (II) in
order to comply with any law, order, regulation, regulatory request or ruling
applicable to such party, (III) subject to SUBSECTION (c) below, in the event
such party is legally compelled (by interrogatories, requests for information or
copies, subpoena, civil investigative demand or similar process) to disclose any
such Program Information, or (IV) in financial statements as required by GAAP;
(ii) it will use the Program Information solely for the
purposes of evaluating, administering and enforcing the transactions
contemplated by the Transaction Documents and making any necessary business
judgments with respect thereto; and
(iii) it will, upon demand, return (and cause each of its
representatives to return) to the applicable Co-Agent, all documents or other
written material received from such Conduit or Co-Agent in connection with
(a)(i)(b) or (c) above and all copies thereof made by such party which contain
the Program Information.
(b) AVAILABILITY OF CONFIDENTIAL INFORMATION. This SECTION
14.8 shall be inoperative as to such portions of the Program Information which
are or become generally available to the public or such party on a
nonconfidential basis from a source other than the applicable Co-Agent or were
known to such party on a nonconfidential basis prior to its disclosure by such
Co-Agent.
(c) LEGAL COMPULSION TO DISCLOSE. In the event that any party
or anyone to whom such party or its representatives transmits the Program
Information is requested or becomes legally compelled (by interrogatories,
requests for information or documents, subpoena, civil investigative demand or
similar process) to disclose any of the Program Information, such party will:
(i) provide the applicable Co-Agent with prompt written notice
so that such Co-Agent may seek a protective order or other appropriate remedy
and/or, if it so chooses, agree that such party may disclose such Program
Information pursuant to such request or legal compulsion; and
(ii) unless such Co-Agent agrees that such Program Information
may be disclosed, make a timely objection to the request or confirmation to
provide such Program Information on the basis that such Program Information is
confidential and subject to the agreements contained in this SECTION 14.8.
In the event that such protective order or other remedy is not obtained, or the
applicable Co-Agent agrees that such Program Information may be disclosed, such
party will furnish only that portion of the Program Information which (in such
party's good faith judgment) is legally required to be furnished and will
exercise reasonable efforts to obtain reliable assurance that confidential
treatment will be accorded the Program Information. In the event any Loan Party
is required to file a copy of this Agreement with the SEC or any other
governmental authority, it will (A) provide the applicable Co-Agent with prompt
written notice of such requirement and (B)
54
62
exercise reasonable efforts to obtain reliable assurance that such governmental
authority will give confidential treatment to this Agreement.
(d) SURVIVAL. This SECTION 14.8 shall survive termination of
this Agreement.
Section 14.9 CAPTIONS AND CROSS REFERENCES. The various
captions (including, without limitation, the table of contents) in this
Agreement are provided solely for convenience of reference and shall not affect
the meaning or interpretation of any provision of this Agreement. Unless
otherwise indicated, references in this Agreement to any Section, Appendix,
Schedule or Exhibit are to such Section of or Appendix, Schedule or Exhibit to
this Agreement, as the case may be, and references in any Section, subsection,
or clause to any subsection, clause or subclause are to such subsection, clause
or subclause of such Section, subsection or clause.
Section 14.10 INTEGRATION. This Agreement and the other
Transaction Documents contain a final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire understanding among the parties hereto with respect
to the subject matter hereof, superseding all prior oral or written
understandings.
Section 14.11 GOVERNING LAW. THIS AGREEMENT, INCLUDING THE
RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO
PRINCIPLES OF CONFLICTS OF LAW, EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE
SECURITY INTEREST OF THE COLLATERAL AGENT, ON BEHALF OF THE SECURED PARTIES, IN
THE COLLATERAL IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK.
Section 14.12 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO
ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT, ANY OTHER TRANSACTION
DOCUMENT OR UNDER ANY AMENDMENT, INSTRUMENT OR DOCUMENT DELIVERED OR WHICH MAY
IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH OR ARISING FROM ANY BANKING OR
OTHER RELATIONSHIP EXISTING IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
TRANSACTION DOCUMENT AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL NOT BE
TRIED BEFORE A JURY.
Section 14.13 CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES.
EACH SELLER PARTY HEREBY ACKNOWLEDGES AND AGREES THAT:
(a) IT IRREVOCABLY (i) SUBMITS TO THE NON-EXCLUSIVE
JURISDICTION, FIRST, OF ANY UNITED STATES FEDERAL COURT, AND SECOND, IF FEDERAL
JURISDICTION IS NOT AVAILABLE, OF ANY NEW YORK STATE COURT, IN EITHER CASE
SITTING IN NEW YORK COUNTY, NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT, AND (ii) WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO, THE DEFENSE OF
55
63
AN INCONVENIENT FORUM TO THE MAINTENANCE OF AN ACTION OR PROCEEDING IN SUCH
COURTS.
(b) TO THE EXTENT THAT IT HAS OR HEREAFTER MAY ACQUIRE ANY
IMMUNITY FROM THE JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER
THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID TO
EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, IT
HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER OR
IN CONNECTION WITH THIS AGREEMENT.
Section 14.14 EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by the 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.
Section 14.15 NO RECOURSE AGAINST OTHER PARTIES. The several
obligations of the Lenders under this Agreement are solely the corporate
obligations of such Lender. No recourse shall be had for the payment of any
amount owing by such Lender under this Agreement or for the payment by such
Lender of any fee in respect hereof or any other obligation or claim of or
against such Lender arising out of or based upon this Agreement, against any
employee, officer, director, incorporator or stockholder of such Lender. Each of
the Borrower, the Servicer and the Agents agrees that each of the Conduits shall
be liable for any claims that such party may have against such Conduit only to
the extent such Conduit has excess funds and to the extent such assets are
insufficient to satisfy the obligations of such Conduit hereunder, such Conduit
shall have no liability with respect to any amount of such obligations remaining
unpaid and such unpaid amount shall not constitute a claim against such Conduit.
Any and all claims against the Conduits or the Co-Agents shall be subordinate to
the claims against such Persons of the holders of such Conduit's Commercial
Paper Notes and its Liquidity Banks.
56
64
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
BORROWER:
INTERIM SERVICES RECEIVABLES CORP.
By: __________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President and Treasurer
SERVICER:
INTERIM SERVICES INC.
By: __________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President and Treasurer
AGENTS:
WACHOVIA BANK, N.A., as Collateral Agent and
Blue Ridge Agent
By: __________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
THE FIRST NATIONAL BANK OF CHICAGO, as Falcon Agent
By: __________________________________
Name:
Title:
57
65
LENDERS:
BLUE RIDGE ASSET FUNDING CORPORATION
BY: WACHOVIA BANK, N.A., ITS ATTORNEY-IN-FACT
By: __________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
Initial Commitment: not applicable
Initial Percentage: not applicable
WACHOVIA BANK, N.A.
By: __________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
Initial Commitment: $90,000,000
Initial Percentage: 60%
58
66
FALCON ASSET SECURITIZATION CORPORATION
By: __________________________________
Name:
Title:
Initial Commitment: not applicable
Initial Percentage: not applicable
THE FIRST NATIONAL BANK OF CHICAGO
By: __________________________________
Name:
Title:
Initial Commitment: $60,000,000
Initial Percentage: 40%
59
67
ANNEX A
DEFINITIONS
A. CERTAIN DEFINED TERMS. As used in this Agreement:
"ACCOUNT" shall have the meaning specified in Section 9-106 of
the UCC.
"ADJUSTED DILUTION RATIO" at any time means the 12-month
rolling average of the Dilution Ratio for the 12 Settlement Periods then most
recently ended.
"ADVANCE" means a borrowing hereunder consisting of the
aggregate amount of the several Loans made on the same Borrowing Date.
"AFFECTED PARTY" means each of the Lenders, the Agents and the
Liquidity Banks.
"AFFILIATE" means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under 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 and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.
"AFFILIATED OBLIGOR" in relation to any Obligor means an
Obligor that is an Affiliate of such Obligor.
"AGENTS" means the Collateral Agent and the Co-Agents.
"AGGREGATE COMMITMENT" means the aggregate of the Commitments
of the Liquidity Banks, as reduced or increased from time to time pursuant to
the terms hereof.
"AGREEMENT" means this Credit and Security Agreement, as it
may be amended or modified and in effect from time to time.
"ALTERNATE BASE RATE" means for any day, the rate per annum
equal to the higher as of such day of (i) the Base Rate, or (ii) one-half of one
percent (0.50%) above the Federal Funds Rate. For purposes of determining the
Alternate Base Rate for any day, changes in the Prime Rate or the Federal Funds
Rate shall be effective on the date of each such change. The Alternate Base Rate
is not necessarily intended to be the lowest rate of interest determined by
Wachovia in connection with extensions of credit.
"ALTERNATE BASE RATE LOAN" means a Loan which bears interest
at the Alternate Base Rate or the Default Rate.
"APPLICABLE REBILLS" means (a) at all times prior to the date,
if any, when the Servicer is able to link rebilled Invoices to the original
Invoice by number, Rebills, and (b) at all
60
68
times from and after the date, if any, when the Servicer is able to link
rebilled Invoices to the original Invoice by number, Net Rebills.
"ARTICLE" means an article of this Agreement unless another
document is specifically referenced.
"AUTHORIZED OFFICER" means: (a) with respect to Interim
Services Inc., any of its Chairman/President/CEO, Executive Vice President/CFO,
Vice President and Treasurer, Assistant Treasurer or Senior Vice
President/Secretary, acting singly, (b) with respect to each of Interim Services
Atlantic LLC and Interim Services Pacific LLC, any of its President/CEO,
Executive Vice President/CFO, Vice President and Treasurer, Assistant Treasurer
or Secretary, acting singly, (c) with respect to Interim Assessment Services
Inc. (F/K/A HR Easy), any of its CEO, Executive Vice President, Treasurer or
Secretary, acting singly, (d) with respect to Saratoga Institute, any of its
Director, Executive Vice President/CFO, Vice President and Treasurer, Assistant
Treasurer or Secretary, acting singly, (e) with respect to ▇▇▇▇▇▇▇ Page
International Inc., any of its Chairman, Executive Vice President/CFO, Vice
President and Treasurer, Assistant Treasurer or Secretary, acting singly, and
(f) with respect to Interim Services Receivables Corp., any of its President,
Executive Vice President/CFO, Vice President/Treasurer, Assistant Treasurer or
Secretary, acting singly.
"BASE RATE" means (a) with respect to Blue Ridge and its
Liquidity Banks, the Prime Rate, and (b) with respect to Falcon and its
Liquidity Banks, the Corporate Base Rate.
"BLUE RIDGE" has the meaning provided in the preamble of this
Agreement.
"BLUE RIDGE AGENT" has the meaning provided in the preamble of
this Agreement.
"BLUE RIDGE ALLOCATION LIMIT" has the meaning set forth in
SECTION 1.1(a).
"BLUE RIDGE FEE LETTER" means that certain Blue Ridge Fee
Letter dated as of July 1, 1999 by and among INTERIM SERVICES, the Borrower,
Blue Ridge and Wachovia, as the Blue Ridge Agent and the Collateral Agent.
"BLUE RIDGE LIQUIDITY AGREEMENT" means the Liquidity Asset
Purchase Agreement dated as of the date hereof among Blue Ridge, the Blue Ridge
Agent, and the Liquidity Banks from time to time party thereto, as the same may
be amended, restated, supplemented, replaced or otherwise modified from time to
time.
"BORROWER" has the meaning provided in the preamble of this
Agreement.
"BORROWER INFORMATION" has the meaning set forth in SECTION
14.7(a).
"BORROWER INFORMATION PROVIDER" has the meaning set forth in
SECTION 14.7(a).
"BORROWING BASE" means, on any date of determination, the
amount determined by reference to the following formula:
[ (NPB - RR) - EDC ]
61
69
WHERE:
NPB = the Net Pool Balance as of the most recent
Cut-Off Date;
RR = the Required Reserve as of the most recent
Cut-Off Date; and
EDC = Deemed Collections that have occurred since
the most recent Cut-Off Date to the extent
such Deemed Collections exceed the Dilution
Reserve.
"BORROWING DATE" means a date on which an Advance is made
hereunder.
"BORROWING REQUEST" is defined in Section 2.1.
"BUSINESS DAY" means any day on which banks are not authorized
or required to close in New York, New York, Chicago, Illinois, Atlanta, Georgia,
or Fort Lauderdale, Florida, and The Depository Trust Company of New York is
open for business, and, if the applicable Business Day relates to any
computation or payment to be made with respect to the Eurodollar Rate (Reserve
Adjusted), any day on which dealings in dollar deposits are carried on in the
London interbank market.
"CHANGE IN CONTROL" means:
(a) the failure of INTERIM SERVICES to own (directly or
through one or more wholly-owned Subsidiaries of INTERIM SERVICES) 100%
of the issued and outstanding shares of the capital stock (including
all warrants, options, conversion rights, and other rights to purchase
or convert into such stock) of the Borrower on a fully diluted basis;
or
(b) means (i) the acquisition by any Person, or two or more
Persons acting in concert, of beneficial ownership (within the meaning
of Rule 13d-3 of the Securities and Exchange Commission under the
Exchange Act) of 20% or more of the outstanding shares of voting stock
of INTERIM SERVICES or (ii) during any period of up to 12 consecutive
months, commencing on the date of this Agreement, individuals who at
the beginning of such 12-month period were directors of INTERIM
SERVICES shall cease for any reason (other than the death, disability
or retirement of an officer of INTERIM SERVICES that is serving as a
director at such time so long as another officer of INTERIM SERVICES
replaces such Person as a director) to constitute a majority of the
Board of Directors of INTERIM SERVICES; PROVIDED, HOWEVER, that the
acquisition of voting stock of INTERIM SERVICES by the existing
shareholders of ▇▇▇▇▇▇▇ Corporation as a portion of the consideration
for INTERIM SERVICES' acquisition of ▇▇▇▇▇▇▇ Corporation and/or its
Subsidiaries shall not constitute a "Change of Control" for purposes of
the Transaction Documents.
"CO-AGENTS" has the meaning provided in the preamble of this
Agreement.
62
70
"CODE" means the Internal Revenue Code of 1986, as the same
may be amended from time to time.
"COLLATERAL" has the meaning set forth in SECTION 9.1.
"COLLATERAL AGENT" has the meaning provided in the preamble of
this Agreement.
"COLLECTION ACCOUNT" has the meaning set forth in SECTION
7.1(i).
"COLLECTIONS" means, (a) with respect to any Receivable, all
funds which either (i) are received by the Borrower, any of the Originators or
the Servicer from or on behalf of the related Obligor in payment of any amounts
owed (including, without limitation, purchase prices, finance charges, interest
and all other charges) in respect of such Receivable, or applied to such amounts
owed by such Obligor (including, without limitation, insurance payments that the
Borrower, any Originator or the Servicer applies in the ordinary course of its
business to amounts owed in respect of such Receivable and net proceeds of sale
or other disposition of repossessed goods or other collateral or property of the
Obligor or any other party directly or indirectly liable for payment of such
Receivable and available to be applied thereon), or (ii) are Deemed Collections,
and (b) with respect to any Demand Advance, any payment of principal or interest
in respect thereof.
"COMMERCIAL PAPER NOTES" shall mean the commercial paper
promissory notes, if any, issued by or on behalf of Blue Ridge of Falcon or that
fund, any CP Rate Loan.
"COMMITMENT" means, for each of Wachovia and First Chicago,
its obligation to make Loans not exceeding the amount set forth opposite its
signature to the Agreement, as such amount may be modified from time to time
pursuant to the terms hereof.
"COMMITMENT INCREASE REQUEST" has the meaning set forth in
SECTION 1.7.
"COMMITMENT REDUCTION NOTICE" has the meaning set forth in
SECTION 1.6.
"CONDUITS" has the meaning provided in the preamble of this
Agreement.
"CONSTITUENTS" means, as to either Co-Agent, the Conduit
represented by it as specified in the preamble to this Agreement, and each of
such Conduit's Liquidity Banks.
"CONTRACT" means with respect to any Receivable, any
agreement, contract or other writing (other than, in each of the foregoing
cases, an Invoice) with respect to the provision of services by an Originator to
an Obligor.
"CONTRACT YEAR" means (i) initially, the period beginning on
July 1, 1999 and ending on June 29, 2000 and (ii) thereafter, each period
beginning on a Scheduled Termination Date and ending on the succeeding Scheduled
Termination Date.
"CONTRACTUAL OBLIGATION" means, as to any Person, any
provision of any security issued by such Person or of any agreement,
undertaking, contract, indenture, mortgage, deed of
63
71
or other instrument, document or agreement to which such Person is a party or by
which it or any of its property is bound.
"CORPORATE BASE RATE" means the rate of interest publicly
announced from time to time by First Chicago as its "corporate base rate." (The
"corporate base rate" is a rate set by First Chicago based upon various factors
including First Chicago's costs and desired return, general economic conditions
and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above, or below such announced rate.) Any change in the
corporate base rate announced by First Chicago shall take effect at the opening
of business on the day specified in the public announcement of such change.
"CP RATE" shall mean:
(a) with respect to Blue Ridge for 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 Notes of Blue Ridge
having a term equal to such CP Tranche Period are sold plus (to the
extent not already deducted from the Principal Amount of such
Commercial Paper Notes) the amount of any placement agent or commercial
paper dealer fees incurred in connection with such sale and other costs
associated with funding small or odd-lot amounts; and
(b) with respect to Falcon for 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 Notes of Falcon having a term
equal to such CP Tranche Period are sold plus (to the extent not
already deducted from the Principal Amount of such Commercial Paper
Notes) the amount of any placement agent or commercial paper dealer
fees incurred in connection with such sale and other costs associated
with funding small or odd-lot amounts.
"CP RATE LOAN" means a Loan made by a Conduit which bears
interest at a CP Rate.
"CP TRANCHE PERIOD" shall mean, a period of 7 to 90 days
commencing on a Business Day selected by the Borrower (or by the Servicer on the
Borrower's behalf) and agreed to by the applicable Co-Agent pursuant to SECTION
2.2. If such CP Tranche Period would end on a day which is not a Business Day,
such CP Tranche Period shall end on the preceding Business Day.
"CREDIT AND COLLECTION POLICY" means those credit and
collection policies and practices of INTERIM SERVICES relating to Contracts
and/or Invoices and Receivables as in effect on the date of this Agreement, as
modified without violating Section 7.3(c), but subject to compliance with
applicable tariffs or state regulations in effect from time to time; PROVIDED
that if an Event of Default or an Unmatured Default has occurred, at the request
of any of the Agents, INTERIM SERVICES shall provide a detailed written summary
of the Credit and Collection Policy.
64
72
"CUT-OFF DATE" means May 23, 1999 and the last day of each
accounting period of INTERIM SERVICES thereafter as reflected on SCHEDULE 1
hereto.
"DAYS SALES OUTSTANDING" or "DSO", means, as of any day, an
amount equal to the product of (x) 91, multiplied by (y) the amount obtained by
dividing (i) the aggregate outstanding balance of Receivables as of the most
recent Cut-Off Date, by (ii) the aggregate amount of Receivables created during
the three Settlement Periods including and immediately preceding such Cut-Off
Date.
"DEEMED COLLECTIONS" means Collections deemed received by the
Borrower under SECTION 3.4.
"DEFAULT HORIZON RATIO" at any time means the ratio (expressed
as a percentage) computed as of the Cut-Off Date for the next preceding
Settlement Period by dividing the aggregate sales generated during the most
recent four Settlement Periods by the aggregate Unpaid Balance of all Eligible
Receivables as of the most recent Cut-off Date.
"DEFAULT RATE" means a rate per annum equal to the sum of (i)
the Alternate Base Rate plus (ii) 2.00%, changing when and as the Alternate Base
Rate changes.
"DEFAULT RATIO" means, as of any Cut-Off Date, the ratio
(expressed as a percentage) computed by dividing (x) the total amount of
Receivables which became Defaulted Receivables during the Settlement Period that
includes such Cut-Off Date, by (y) the aggregate sales generated by the
Originators during the Settlement Period occurring four months prior to the
Settlement Period ending on such Cut-Off Date.
"DEFAULT TRIGGER RATIO" means, as of any Cut-Off Date, the
ratio (expressed as a percentage) computed by dividing (x) the total amount of
Receivables that are Defaulted Receivables as of such Cut-Off Date, by (y) the
aggregate sales generated by the Originators during the Settlement Period
occurring four months prior to the Settlement Period ending on such Cut-Off
Date.
"DEFAULTED RECEIVABLE" means a Receivable: (a) as to which any
payment, or part thereof, remains unpaid for more than 120 days from the
original due date for such payment; (b) as to which an Event of Bankruptcy has
occurred and remains continuing with respect to the Obligor thereof; (c) which
has been referred to an outside collection agency or attorney for collection, or
(d) which has been, or, consistent with the Credit and Collection Policy would
be, written off the Borrower's, any Originator's or the Servicer's books as
uncollectible.
"DELINQUENCY RATIO" at any time means the ratio (expressed as
a percentage) computed as of the Cut-Off Date for the next preceding Settlement
Period by dividing (x) the aggregate Unpaid Balance of all Receivables that are
Delinquent Receivables on such Cut-Off Date by (y) the aggregate Unpaid Balance
of Receivables on such Cut-Off Date.
"DELINQUENT RECEIVABLE" means a Receivable as to which any
payment, or part thereof, remains unpaid for 91-120 days from the original due
date for such payment.
65
73
"DEMAND ADVANCE" means an advance made by the Borrower to
INTERIM SERVICES on any day during the Revolving Period other than a Settlement
Date on which no Event of Default or Unmatured Default exists and is continuing,
which advance (a) is payable upon demand, (b) is not evidenced by an instrument,
chattel paper or a certificated security, (c) bears interest at a market rate
determined by the Borrower and the Servicer from time to time, and (d) may not
be offset by INTERIM SERVICES against amounts due and owing from the Borrower to
INTERIM SERVICES under its Subordinated Note.
"DILUTION" means the amount of any reduction or cancellation
of the Unpaid Balance of a Receivable as described in SECTION 3.4(a).
"DILUTION HORIZON RATIO" means, on any date of determination,
an amount calculated by dividing (a) cumulative sales generated during the two
most recent Settlement Periods by (b) the aggregate Unpaid Balance of all
Eligible Receivables as of the most recent Cut-off Date.
"DILUTION RATIO" means a percentage equal to a fraction, the
numerator of which is the total amount of decreases in Unpaid Balances due to
Dilutions during the most recent Settlement Period, and the denominator of which
is the amount of sales generated during the Settlement Period one month prior to
the most recent Settlement Period.
"DILUTION RESERVE" means a percentage equal to the product of
(x) the sum of (i) 2.0 times the Adjusted Dilution Ratio, plus (ii) the Dilution
Volatility Component, multiplied by (y) the Dilution Horizon Ratio.
"DILUTION VOLATILITY COMPONENT" means an amount (expressed as
a percentage) equal to the product of (i) the difference between (a) the highest
three-month rolling average Dilution Ratio over the past 12 Settlement Periods
and (b) the Adjusted Dilution Ratio, and (ii) a fraction, the numerator of which
is equal to the amount calculated in (i)(a) of this definition and the
denominator of which is equal to the amount calculated in (i)(b) of this
definition.
"DOLLARS" means dollars in lawful money of the United States
of America.
"DOWNGRADED LIQUIDITY BANK" means a Liquidity Bank which has
been the subject of a Downgrading Event.
"DOWNGRADING EVENT" with respect to any Person means the
lowering of the rating with regard to the short-term securities of such Person
to below (i) A-1 by S&P, or (ii) P-1 by Moody's.
"ELIGIBLE ASSIGNEE" means (a) any "bankruptcy remote" special
purpose entity which is administered by Wachovia or First Chicago (or any
Affiliate of the foregoing) that is in the business of acquiring or financing
receivables, securities and/or other financial assets and which issues
commercial paper notes that are rated at least A-1 by S&P and P-1 by Moody's,
(b) any Qualifying Liquidity Bank having a combined capital and surplus of at
least $250,000,000, or (c) any Downgraded Liquidity Bank whose liquidity
commitment has been fully drawn by the applicable Conduit or its Co-Agent and
funded into a collateral account.
66
74
"ELIGIBLE ORIGINATOR" means each of (a) INTERIM SERVICES, (b)
each of Interim Services Atlantic LLC, a Delaware limited liability company,
Interim Services Pacific LLC, a Delaware limited liability company, Interim
Assessment Services Inc. (f/k/a HR Easy Inc.), a North Carolina corporation,
Saratoga Institute Inc., a California corporation, and ▇▇▇▇▇▇▇ Page
International Inc., a Delaware corporation, so long as they are direct or
indirect wholly-owned Subsidiaries of INTERIM SERVICES, and (c) each of the
other direct or indirect, wholly-owned Subsidiaries of INTERIM SERVICES who
(with the consent of the Co-Agents if such Subsidiary constitutes a Material
Proposed Addition) becomes a "seller" party to the Sale Agreement by executing a
Joinder Agreement and complying with the conditions set forth in Article V of
the Sale Agreement.
"ELIGIBLE RECEIVABLE" means, at any time, a Receivable:
(a) which is a Receivable arising out of the sale of services
by an Eligible Originator in the ordinary course of its business that
has been sold to the Borrower pursuant to the Sale Agreement in a "true
sale" transaction;
(b) as to which the perfection of the Collateral Agent's
security interest, on behalf of the Secured Parties, is governed by the
laws of a jurisdiction where the Uniform Commercial Code-Secured
Transactions is in force, and which constitutes an "account" or a
"general intangible" as defined in the Uniform Commercial Code as in
effect in such jurisdiction;
(c) the Obligor of which is resident of the United States or
any of its possessions or territories, and is not (i) an Affiliate of
any Loan Party, or (ii) a Governmental Authority as to which the
assignment of receivables owing therefrom requires compliance with the
Federal Assignment of Claims Act or other similar legislation (unless
the Borrower has complied therewith); PROVIDED, HOWEVER, that the
Borrower shall not be required to comply with the Federal Assignment of
Claims Act or other similar legislation so long as the aggregate amount
of Receivables of the type described in this clause (c)(ii) does not
exceed 2.5% of the aggregate Outstanding Balance of all Eligible
Receivables as of the last day of any Settlement Period;
(d) which is not a Defaulted Receivable or a Delinquent
Receivable at such time;
(e) with regard to which the representations and warranties of
the Borrower in SECTIONS 6.1(j), (l) and (p) are true and correct;
(f) the granting of a security interest therein does not
contravene or conflict with any law;
(g) which is denominated and payable only in Dollars in the
United States;
(h) which arises under a Contract and is evidenced by an
Invoice , in each case that has been duly authorized and that, together
with such Receivable, is in
67
75
full force and effect and constitutes the legal, valid and binding
obligation of the Obligor of such Receivable enforceable against such
Obligor in accordance with its terms and is not subject to any dispute,
offset (except as provided below), counterclaim or defense whatsoever;
PROVIDED, HOWEVER, that if such dispute, offset, counterclaim or
defense affects only a portion of the Unpaid Balance of such
Receivable, then such Receivable may be deemed an Eligible Receivable
to the extent of the portion of such Unpaid Balance which is not so
affected, and PROVIDED, further, that (x) Receivables of any Obligor
which has any accounts payable by the applicable Originator or by a
wholly-owned Subsidiary of such Originator (thus giving rise to a
potential offset against such Receivables) may be treated as Eligible
Receivables to the extent that the Obligor of such Receivables has
agreed pursuant to a written agreement in form and substance
satisfactory to the Administrative Agent, that such Receivables shall
not be subject to such offset, and (y) unless and until either of the
Co-Agents notifies the other Co-Agent and the Borrower to the contrary,
the potential right of Dell Computer Corporation or IBM Corporation to
offset against such Receivables shall not constitute a reduction in the
portion thereof that will be deemed to be eligible unless Dell Computer
Corporation or IBM Corporation, as the case may be, has effected such
offset or notified the applicable Originator or its wholly-owned
Subsidiary that it intends to offset unless paid amounts owed to it;
(i) which, together with the Contract and/or Invoice 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 usury, truth in lending, fair credit
billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy) and with respect to which no party to
the Contract and/or Invoice related thereto is in violation of any such
law, rule or regulation in any material respect if such violation would
impair the collectibility of such Receivable;
(j) which satisfies in all material respects all applicable
requirements of the applicable Eligible Originator's Credit and
Collection Policy;
(k) which, according to the Contract and/or Invoice related
thereto, is due and payable within 30 days from the invoice date of
such Receivable;
(l) the original term of which has not been extended (except
as permitted in SECTION 8.2(c)); and
(m) if the applicable Eligible Originator acquired such
Receivable through a Material Acquisition requiring a Review, the
Co-Agents have notified the Borrower in writing that such Receivable
(and other similarly-acquired Receivables) are acceptable to the
Co-Agents based on the satisfactory outcome of such Review.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any rule or regulation issued
thereunder.
68
76
"ERISA AFFILIATE" means any trade or business (whether or not
incorporated) under common control with INTERIM SERVICES within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).
"ERISA EVENT" means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by INTERIM SERVICES or any ERISA Affiliate from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was
a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a
cessation of operations which is treated as such a withdrawal under Section
4062(e) of ERISA; (c) a complete or partial withdrawal by INTERIM SERVICES or
any ERISA Affiliate from a Multiemployer Plan or notification that a
Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to
terminate, the treatment of a Plan amendment as a termination under Section 4041
or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which might
reasonably be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan
or Multiemployer Plan; or (f) the imposition of any liability under Tide IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon INTERIM SERVICES or any ERISA Affiliate.
"EURODOLLAR BUSINESS DAY" means a day of the year as defined
in CLAUSE (I) of the definition of Business Day.
"EURODOLLAR LOAN" means a Loan which bears interest at the
applicable Eurodollar Rate.
"EURODOLLAR RATE" means, for any Interest Period, the rate per
annum determined on the basis of the offered rate for deposits in Dollars of
amounts equal or comparable to the principal amount of the related Liquidity
Funding offered for a term comparable to such Interest Period, which rates
appear on a Bloomberg L.P. terminal, displayed under the address "US0001M
(Index) Q (Go)" effective as of 11:00 A.M., London time, two Eurodollar Business
Days prior to the first day of such Interest Period, PROVIDED that if no such
offered rates appear on such page, the Eurodollar Rate for such Interest Period
will be the arithmetic average (rounded upwards, if necessary, to the next
higher 1/100th of 1%) of rates quoted by not less than two major banks in New
York City, selected by the Co-Agents, at approximately 10:00 A.M., New York City
time, two Eurodollar Business Days prior to the first day of such Interest
Period, for deposits in Dollars offered by leading European banks for a period
comparable to such Interest Period in an amount comparable to the principal
amount of such Liquidity Funding.
"EURODOLLAR RATE (RESERVE ADJUSTED)" applicable to any
Interest Period means a rate PER ANNUM equal to the quotient obtained (rounded
upwards, if necessary, to the next higher 1/100th of 1%) by DIVIDING (i) the
applicable Eurodollar Rate for such Interest Period by (ii) 1.00 MINUS the
Eurodollar Reserve Percentage.
"EURODOLLAR RESERVE PERCENTAGE" shall mean, with respect to
any Interest Period, the maximum reserve percentage, if any, applicable to a
Liquidity Bank under Regulation D during such Interest Period (or if more than
one percentage shall be applicable, the daily average
69
77
of such percentages for those days in such Interest Period during which any such
percentage shall be applicable) for determining such Liquidity Bank's reserve
requirement (including any marginal, supplemental or emergency reserves) with
respect to liabilities or assets having a term comparable to such Interest
Period consisting or included in the computation of "Eurocurrency Liabilities"
pursuant to Regulation D. Without limiting the effect of the foregoing, the
Eurodollar Reserve Percentage shall reflect any other reserves required to be
maintained by such Liquidity Bank by reason of any Regulatory Change against (a)
any category of liabilities which includes deposits by reference to which the
"London Interbank Offered Rate" or "LIBOR" is to be determined or (b) any
category of extensions of credit or other assets which include LIBOR-based
credits or assets.
"EVENT OF DEFAULT" means an event described in SECTION 10.1.
"EVENT OF BANKRUPTCY" shall be deemed to have occurred with
respect to a Person if either:
(a) a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the
liquidation, reorganization, debt arrangement, dissolution, winding up,
or composition or readjustment of debts of such Person, the appointment
of a trustee, receiver, custodian, liquidator, assignee, sequestrator
or the like for such Person or all or substantially all of its assets,
or any similar action with respect to such Person under any law
relating to bankruptcy, insolvency, reorganization, winding up or
composition or adjustment of debts, and such case or proceeding shall
continue undismissed, or unstayed and in effect, for a period of 60
consecutive days; or an order for relief in respect of such Person
shall be entered in an involuntary case under the federal bankruptcy
laws or other similar laws now or hereafter in effect; or
(b) such Person shall commence a voluntary case or other
proceeding under any applicable bankruptcy, insolvency, reorganization,
debt arrangement, dissolution or other similar law now or hereafter in
effect, or shall consent to the appointment of or taking possession by
a receiver, liquidator, assignee, trustee, custodian, sequestrator (or
other similar official) for, such Person or for any substantial part of
its property, or shall make any general assignment for the benefit of
creditors, or shall be adjudicated insolvent, or admit in writing its
inability to, pay its debts generally as they become due, or, if a
corporation or similar entity, its board of directors shall vote to
implement any of the foregoing.
"EXCESS CONCENTRATION AMOUNT" means, as of any date, the sum
of the amounts by which the aggregate Unpaid Balance of Receivables of each
Obligor exceeds the Obligor Concentration Limit for such Obligor.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXHIBIT" refers to an exhibit to this Agreement, unless
another document is specifically referenced.
70
78
"EXTENSION REQUEST" has the meaning set forth in SECTION 1.8.
"FACILITY FEE" has the meaning set forth in the Fee Letters.
"FALCON" has the meaning provided in the preamble of this
Agreement.
"FALCON AGENT" has the meaning provided in the preamble of
this Agreement.
"FALCON ALLOCATION LIMIT" has the meaning set forth in SECTION
1.1(b).
"FALCON FEE LETTER" means that certain Falcon Fee Letter dated
as of July 1, 1999 by and among INTERIM SERVICES, the Borrower, Falcon and First
Chicago, as the Falcon Agent.
"FALCON LIQUIDITY AGREEMENT" means the Liquidity Asset
Purchase Agreement dated as of the date hereof among Falcon, the Falcon Agent,
and the Liquidity Banks from time to time party thereto, as the same may be
amended, restated, supplemented, replaced or otherwise modified from time to
time.
"FEDERAL FUNDS RATE" means, for any day, the rate PER ANNUM
(rounded upwards, if necessary, to the next higher 1/100th of 1%) 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 on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day, PROVIDED THAT (i) if the day for which such rate is to
be determined is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the average
rate charged to the applicable Co-Agent on such day on such transactions, as
reasonably determined by such Co-Agent.
"FEDERAL RESERVE BOARD" means the Board of Governors of the
Federal Reserve System, or any successor thereto or to the functions thereof.
"FEE LETTERS" means, collectively, the Blue Ridge Fee Letter
and the Falcon Fee Letter.
"FINAL PAYOUT DATE" means the date following the Termination
Date on which the Obligations have been paid in full.
"FIRST CHICAGO" has the meaning provided in the preamble of
this Agreement.
"FIRST CHICAGO ROLES" has the meaning set forth in SECTION
11.10(b).
"GAAP" shall mean generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such accounting profession, which are applicable to the
circumstances as of the date of determination.
71
79
"GENERAL INTANGIBLE" shall have the meaning specified in
Section 9-105 of the UCC.
"GOVERNMENTAL AUTHORITY" means any nation or government, any
state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"GUARANTEE" of or by any Person means any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other Person (the "PRIMARY
OBLIGOR") in any manner, whether directly or indirectly, and including any
obligation of such Person, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness, (b) to purchase property, securities or
services for the purpose of assuring the owner of such Indebtedness of the
payment of such Indebtedness or (c) to maintain working capital, equity capital
or other financial statement condition or liquidity of the primary obligor so as
to enable the primary obligor to pay such Indebtedness; PROVIDED HOWEVER that
the term Guarantee shall not include endorsements for collection or deposit, in
either case, in the ordinary course of business.
"INDEBTEDNESS" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money or with respect to deposits or
advances of any kind, (b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments, (c) all obligations of such Person
upon which interest charges are customarily paid, (d) all obligations of such
Person under conditional sale or other title retention agreements relating to
property or assets purchased by such Person, (e) all obligations of such Person
issued or assumed as the deferred purchase price of property or services (other
than trade payables incurred in the ordinary course of business), (f) all
Indebtedness of others secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, but limited, if such obligations are without
recourse to such Person, to the lesser of the principal amount of such
Indebtedness or the fair market value of such property, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations of such
Person, (i) all obligations of such Person in respect of interest rate
protection agreements, foreign currency exchange agreements or other interest or
exchange rate hedging arrangements (the amount of any such obligation to be the
amount that would be payable upon the acceleration, termination or liquidation
thereof) and (j) all obligations of such Person as an account party in respect
of letters of credit and bankers' acceptances. The Indebtedness of any Person
shall include the Indebtedness of any partnership in which such Person is a
general partner.
"INDEMNIFIED AMOUNTS" has the meaning set forth in SECTION
13.1(a).
"INDEMNIFIED PARTY" has the meaning set forth in SECTION
13.1(a).
"INDEPENDENT DIRECTOR" has the meaning set forth in SECTION
7.4(ii).
72
80
"INFORMATION PACKAGE" has the meaning set forth in SECTION
3.1.
"INITIAL DUE DILIGENCE AUDITOR" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP.
"INTEREST PAYMENT DATE" means:
(a) with respect to any CP Rate Loan, the last day of its CP
Tranche Period, the date on which any such Loan is prepaid, in whole or
in part, and the Termination Date;
(b) with respect to any Eurodollar Loan, the last day of its
Interest Period, the date on which any such Loan is prepaid, in whole
or in part, and the Termination Date;
(c) with respect to any Alternate Base Rate Loan, each
Settlement Date while such Loan remains outstanding, the date on which
any such Loan is prepaid, in whole or in part, and the Termination
Date; and
(d) with respect to any Loan while the Default Rate is
applicable thereto, upon demand or, in the absence of any such demand,
each Settlement Date while such Loan remains outstanding, the date on
which any such Loan is prepaid, in whole or in part, and the
Termination Date.
"INTEREST PERIOD" means, with respect to a Eurodollar Loan, a
period not to exceed three months commencing on a Business Day selected by the
Borrower (or the Servicer on the Borrower's behalf) pursuant to this Agreement
and agreed to by the applicable Co-Agent. Such Interest Period shall end on the
day which corresponds numerically to such date one, two, or three months
thereafter, PROVIDED, HOWEVER, that (i) if there is no such numerically
corresponding day in such next, second or third succeeding month, such Interest
Period shall end on the last Business Day of such next, second or third
succeeding month, and (ii) if an Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day unless said next succeeding Business Day falls in a new
calendar month, then such Interest Period shall end on the immediately preceding
Business Day.
"INTEREST RATE" means a Eurodollar Rate (Reserve Adjusted), a
CP Rate, an Alternate Base Rate or the Default Rate.
"INTEREST RESERVE" shall mean, on any date of determination,
1.5 TIMES the Alternate Base Rate MULTIPLIED by a fraction the numerator of
which is the 12-month high Days Sales Outstanding and the denominator of which
is 360.
"INTERIM SERVICES" has the meaning set forth in the preamble
of this Agreement.
"INVOICE" means, collectively, with respect to any Receivable:
(i) any paper or electronic ▇▇▇▇, statement or invoice for services rendered by
an Originator to an Obligor, and (ii)
73
81
any instrument or chattel paper now or hereafter evidencing all or any portion
of the same, but in all instances excluding Contracts and/or Invoices.
"JOINDER AGREEMENT" has the meaning set forth in the Sale
Agreement.
"LENDERS" means Blue Ridge, Falcon, First Chicago, Wachovia
and their respective successors and permitted assigns.
"LIEN" means any security interest, lien, encumbrance, pledge,
assignment, title retention, similar claim, right or interest.
"LIQUIDITY AGREEMENTS" means, collectively, the Blue Ridge
Liquidity Agreement and the Falcon Liquidity Agreement.
"LIQUIDITY BANK" means (a) with respect to Falcon, First
Chicago, (b) with respect to Blue Ridge, Wachovia, and (c) any Eligible Assignee
of First Chicago's Commitment hereunder and under Falcon's Liquidity Agreement
or Wachovia's Commitment hereunder and under Blue Ridge's Liquidity Agreement,
in each case, to which the Borrower has consented if required under SECTION
12.1. A Liquidity Bank will become a "LENDER" hereunder at such time as it makes
any Liquidity Funding.
"LIQUIDITY COMMITMENT" means, with respect to each Liquidity
Bank, its commitment to make Liquidity Fundings pursuant to the Liquidity
Agreement to which it is a party.
"LIQUIDITY FUNDING" means (a) a purchase made by any Liquidity
Bank pursuant to its Liquidity Commitment of all or any portion of a Conduit's
Loan, or (b) any Loan made by a Conduit's Liquidity Banks in lieu of such
Conduit pursuant to SECTION 1.1.
"LIQUIDITY TERMINATION DATE" means the earlier to occur of the
following:
(a) the date on which either Conduit's Liquidity Banks'
commitments pursuant to such Conduit's Liquidity Agreement expire,
cease to be available to such Conduit or otherwise cease to be in full
force and effect; or
(b) the date on which a Downgrading Event with respect to a
Liquidity Bank shall have occurred and been continuing for not less
than 30 days, and either (i) the Downgraded Liquidity Bank shall not
have been replaced by a Qualifying Liquidity Bank pursuant to the
Applicable Liquidity Agreement, or (ii) the commitment of such
Downgraded Liquidity Bank under a Liquidity Agreement shall not have
been funded or collateralized in such a manner that will avoid a
reduction in or withdrawal of the credit rating applied to the
Commercial Paper Notes to which such Liquidity Agreement applies by any
of the rating agencies then rating such Commercial Paper Notes.
74
82
"LOAN" means any loan made by a Lender to the Borrower
pursuant to this Agreement. Each Loan shall either be a CP Rate Loan, an
Alternate Base Rate Loan or a Eurodollar Rate Loan, selected in accordance with
the terms of this Agreement.
"LOAN PARTIES" means, collectively, (i) the Borrower, and (ii)
INTERIM SERVICES.
"LOCK-BOX" has the meaning set forth in the Lock-Box
Agreements.
"LOCK-BOX ACCOUNT" means any bank account of the Borrower or
the Collateral Agent into which Collections are deposited or transferred and
which is subject to a Lock-Box Agreement.
"LOCK-BOX AGREEMENT" means a letter agreement, in
substantially the form of EXHIBIT A (or as otherwise approved by the Collateral
Agent), among an Originator, the Borrower, the Collateral Agent and a Lock-Box
Bank.
"LOCK-BOX BANK" means any of the banks holding one or more
lock-boxes, blocked accounts or Lock-Box Accounts receiving Collections from
Receivables.
"LOSS RESERVE" as of any Cut-Off Date means a percentage equal
to the greater of (a) 10% and (b) the product of (i) 2.0 times the highest
three-month rolling average Default Ratio during the most recent 12 Settlement
Periods and (ii) the Default Horizon Ratio.
"MATERIAL ACQUISITION" means that any existing Originator
acquires the receivables originated by one or more other Persons who are not
existing Eligible Originators, whether by purchase, merger, consolidation or
otherwise, if the aggregate amount of receivables so acquired from any one such
Person exceeds $10 million or the aggregate amount of receivables so acquired
from all such Persons in any Contract Year exceeds $25 million.
"MATERIAL ADVERSE EFFECT" means:
(i) a material adverse change in, or a material adverse effect
upon (A) the operations, business, properties, condition (financial or
otherwise) or prospects of INTERIM SERVICES and its Subsidiaries taken
as a whole, or (B) the Borrower's assets or financial condition;
(ii) a material impairment of the ability of any Loan Party to
perform under any Transaction Document or to avoid or cure, as
applicable, any Unmatured Default or Event of Default;
(iii) a material adverse effect upon the legality, validity,
binding effect or enforceability against any Loan Party of any
Transaction Document;
(iv) a material adverse effect upon the validity,
enforceability or collectibility of a material portion of the
Receivables; or
75
83
(v) a material adverse effect upon the validity, perfection,
priority or enforceability of the Borrower's title to -- or the
Collateral Agent's security interest, on behalf of the Secured Parties,
in -- the Collateral.
"MATERIAL PROPOSED ADDITION" means a Person (other than
▇▇▇▇▇▇▇ Corporation and its Subsidiaries or a successor thereto) whom the
Borrower or INTERIM SERVICES proposes to add as a "seller" under the Sale
Agreement if either (i) such Person's receivables (on the proposal date) exceed
$10 million in the aggregate, or (ii) such Person's receivables (on such
proposal date), when aggregated with the receivables of all other Persons added
as "sellers" under the Sale Agreement in the same Contract Year (measured on the
respective dates such other Persons became "sellers" under the Sale Agreement)
exceed $25 million in the aggregate.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"MULTIEMPLOYER PLAN" means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, to which INTERIM SERVICES or any ERISA
Affiliate makes, is making, or is obligated to make contributions or, during the
preceding three calendar years, has made, or been obligated to make,
contributions.
"NET POOL BALANCE" means, at any time, an amount equal to (i)
the aggregate Unpaid Balance of all Eligible Receivables at such time, MINUS
(ii) the Excess Concentration Amount at such time.
"NET REBILLS" means, for any Settlement Period, the aggregate
amount of increases in Invoice amounts due to Rebills minus the aggregate amount
of decreases in Invoice amounts due to Rebills.
"OBLIGATIONS" means all unpaid principal of and accrued and
unpaid interest on the Loans, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Borrower to the Lenders
(or any Lender), the Agents (or any Agent) or any Indemnified Party arising
under the Transaction Documents.
"OBLIGOR" means a Person obligated to make payments with
respect to a Receivable, including any guarantor thereof.
"OBLIGOR CONCENTRATION LIMIT" means, at any time, in relation
to the aggregate Unpaid Balance of Receivables owed by any single Obligor and
its Affiliated Obligors (if any), the lesser of (a) one-third of the Loss
Reserve, or (b) the applicable concentration limit shall (unless BOTH Co-Agents
agree, from time to time upon the Borrower's request, to a higher percentage of
Eligible Receivables for a particular Obligor and its Affiliates) be determined
as follows for Obligors who have a short term unsecured debt rating currently
assigned to them by either S&P or Moody's, the applicable concentration limit
shall be determined according to the following table (and, if such Obligor is
rated by both agencies and has a split rating, the applicable rating will be the
lower of the two):
76
84
---------------------------------- ----------------------------- ------------------------------
Allowable % of Eligible
S&P Rating ▇▇▇▇▇'▇ Rating Receivables
---------------------------------- ----------------------------- ------------------------------
A-1+ 10%
---------------------------------- ----------------------------- ------------------------------
A-1 P-1 8%
---------------------------------- ----------------------------- ------------------------------
A-2 P-2 6%
---------------------------------- ----------------------------- ------------------------------
A-3 P-3 3%
---------------------------------- ----------------------------- ------------------------------
Below A-3 or Not Rated Below P-3 or Not Rated 2%
---------------------------------- ----------------------------- ------------------------------
PROVIDED, HOWEVER, that unless and until either Co-Agent gives the Borrower 5
Business Days' notice to the contrary, the Obligor Concentration Limit for IBM
Corporation and its Affiliated Obligors shall be 9% of Eligible Receivables .
"ORIGINATOR" means any of INTERIM SERVICES or any its direct
or indirect wholly-owned Subsidiaries who is or becomes a "seller" under the
Sale Agreement.
"PAYMENT INTANGIBLE" means a "general intangible for money due
or to become due" as such phrase is used in Section 9-318(4) of the UCC.
"PBGC" means the Pension Benefit Guaranty Corporation, or any
successor thereto.
"PENSION PLAN" means a pension plan (as defined in Section
3(2) of ERISA) subject to Title IV of ERISA which INTERIM SERVICES sponsors or
maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a multiple employer plan (as described in
Section 4064(a) of ERISA) has made contributions at any time during the
immediately preceding five plan years.
"PERCENTAGE" means (a) with respect to Blue Ridge and its
Liquidity Banks in the aggregate, 60%, and (b) with respect to Falcon and its
Liquidity Banks in the aggregate, 40%, as the foregoing percentages may be
adjusted from time to time pursuant to SECTION 1.7.
"PERMITTED RESTRUCTURING" means any merger, consolidation or
similar combination of an Originator (i) with another Originator, and/or (ii)
with and into a newly formed entity that is (A) domiciled in the United States
of America, and (B) wholly-owned, directly or indirectly, by INTERIM SERVICES,
with no assets (other than its initial paid-in capital) and no liabilities
(other than minimal organization costs) for the purpose of changing its legal
form from a corporation, partnership or limited liability company domiciled in
one state of the United States to a corporation, partnership or limited
liability company domiciled in another state, from a corporation to a
partnership or limited liability company, from a partnership to a corporation or
limited liability company, or from a limited liability company to a partnership
or corporation, as the case may be, and/or (iii) with any other Person to whom
each of the Co-Agents gives its prior written consent, SO LONG AS: (1) the
successor or surviving entity unconditionally assumes such Originator's (or
Originators') respective obligations under the Transaction Documents to which it
is (or they are) a party immediately prior to giving effect to
77
85
such combination, (2) prior to the effectiveness of such combination, all UCC
financing statements necessary to maintain the validity, perfection and priority
of the Borrower's ownership interest in the Receivables and Related Rights (as
defined in the Sale Agreement) acquired or to be acquired from such Originator
or Originators under the Sale Agreement, and the Collateral Agent's security
interest therein, have been duly executed and filed in all necessary
jurisdictions, and (3) if the surviving entity in such combination(s) is not an
existing party to the Sale Agreement, all other documents required to be
delivered in connection with a Joinder Agreement under the Sale Agreement have
been duly executed and delivered substantially contemporaneously with such
combination(s).
"PERSON" means any natural Person, corporation, firm, joint
venture, partnership, limited liability company, association, enterprise, trust
or other entity or organization, or any government or political subdivision or
any agency, department or instrumentality thereof.
"PLAN" means an employee benefit plan (as defined in Section
3(3) of ERISA) which a Loan Party sponsors or maintains or to which a Loan Party
makes, is making, or is obligated to make contributions and includes any Pension
Plan, other than a Plan maintained outside the United States primarily for the
benefit of Persons who are not U.S. residents.
"PREPAYMENT NOTICE" has the meaning set forth in SECTION
1.5(a).
"PRIME RATE" means the rate of interest per annum publicly
announced from time to time by Wachovia as its "prime rate." (The "prime rate"
is a rate set by Wachovia based upon various factors including Wachovia's costs
and desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at, above, or
below such announced rate.) Any change in the prime rate announced by Wachovia
shall take effect at the opening of business on the day specified in the public
announcement of such change.
"PRINCIPAL AMOUNT" means the actual net cash proceeds received
by a Conduit upon issuance of a Commercial Paper Note.
"PROGRAM INFORMATION" has the meaning set forth in SECTION
14.8.
"PROPERTY" of a Person means any and all property, whether
real, personal, tangible, intangible, or mixed, of such Person, or other assets
owned, leased or operated by such Person.
"QUALIFYING LIQUIDITY BANK" means a Liquidity Bank with a
rating of its short-term securities equal to or higher than (i) A-1 by S&P and
(ii) P-1 by Moody's.
"RATABLE SHARE" means with respect to any Liquidity Bank, the
ratio which its Commitment bears to the sum of the Commitments of all Liquidity
Banks for the same Conduit.
"REBILL" means, with respect to any Receivable, any
cancellation of the applicable Invoice and reissuance of a replacement Invoice
therefor.
78
86
"RECEIVABLE" means any Account or any Payment Intangible
arising from the sale of professional services in the fields of information
technology, finance, law, manufacturing and human resources, as well as
clerical, administrative and light industrial staffing by an Originator,
including, without limitation, the right to payment of any interest or finance
charges and other amounts with respect thereto, which is sold to the Borrower
under the Sale Agreement. Rights to payment arising from any one transaction,
including, without limitation, rights to payment represented by an individual
Invoice, shall constitute a Receivable separate from a Receivable consisting of
the rights to payment arising from any other transaction; PROVIDED, HOWEVER,
that a Rebill shall not be deemed to be the creation of a new Receivable
(regardless of the invoice number assigned thereto) and shall instead be deemed
to be an amendment and restatement of the original Receivable and related
Invoice; and PROVIDED, FURTHER, that any right to payment referred to in the
immediately preceding sentence shall be a Receivable regardless of whether the
account debtor or the Borrower treats such right to payment as a separate
payment obligation.
"REGULATION D" means Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor
thereto or other regulation or official interpretation of said Board of
Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.
"REGULATION U" means Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to the extension of credit by banks for the purpose of purchasing or carrying
margin stocks applicable to member banks of the Federal Reserve System.
"REGULATORY CHANGE" shall mean any change after the date of
this Agreement in United States (federal, state or municipal) or foreign laws or
regulations (including Regulation D) or the adoption or making after such date
of any interpretations, directives or requests applying to a class of banks
(including the Liquidity Banks) of or under any United States (federal, state or
municipal) or foreign, laws, or regulations (whether or not having the force of
law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"RELATED ASSETS" means (a) all rights to, but not any
obligations under, all related Invoices and all Related Security related to any
Receivables, (b) all rights and interests of the Borrower under the Sale
Agreement in relation to any Receivables, (c) all books and records evidencing
or otherwise relating to any Receivables, (d) the Collection Account (if any)
and all Lock-Box Accounts and all cash and instruments therein, to the extent
constituting or representing the items in the following clauses (e) and (f), (e)
all of the Borrower's rights to demand and receive payment in respect of any
Demand Advances, and (f) all Collections in respect of, and other proceeds of,
any Receivables or any other Related Assets.
"RELATED SECURITY" means, with respect to any Receivable, all
of the Borrower's right, title and interest in and to: (a) all Invoices that
relate to such Receivable; (b) all security deposits and other security
interests or liens and property subject thereto from time to time purporting to
secure payment of such Receivable, whether pursuant to the Contract and/or
79
87
Invoice related to such Receivable or otherwise; (c) all UCC financing
statements covering any collateral securing payment of such Receivable; (d) all
guarantees and other agreements or arrangements of whatever character from time
to time supporting or securing payment of such Receivable whether pursuant to
the Invoice related to such Receivable or otherwise; and (e) all insurance
policies, and all claims thereunder, related to such Receivable, in each case to
the extent directly related to rights to payment, collection and enforcement,
and other rights with respect to such Receivable.
"REPORTABLE EVENT" means any of the events set forth in
Section 4043(c) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been waived in
regulations issued by the PBGC.
"REPORTING DATE" has the meaning set forth in SECTION 3.1(a).
"REQUIRED AMOUNTS" has the meaning set forth in SECTION 3.2.
"REQUIRED RESERVE" means, on any day during a Settlement
Period, an amount equal to the product of (A) the greater of (i) 9.79% and (ii)
the sum of (w) the Loss Reserve, (x) the Dilution Reserve, (y) the Interest
Reserve and (z) the Servicing Reserve TIMES (B) the Net Pool Balance on such
day.
"REQUIREMENT OF LAW" means, as to any Person, any law
(statutory or common), treaty, rule or regulation or final, nonappealable
determination of an arbitrator or of a Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.
"RESPONSE DATE" has the meaning set forth in SECTION 1.8.
"RESPONSIBLE OFFICER" of any Person means any of its Chairman,
Chief Executive Officer, Chief Operating Officer, President, Chief Financial
Officer or Treasurer.
"REVIEW" has the meaning set forth in SECTION 7.1(c).
"REVOLVING PERIOD" means the period from and after the date of
the initial Advance under this Agreement to but excluding the Termination Date.
"S&P" means Standard and Poor's Ratings Services, a division
of The McGraw Hill Companies, Inc.
"SALE AGREEMENT" means the Receivables Sale Agreement dated as
of July 1, 1999 between the Originators, as sellers, and the Borrower, as
purchaser, as it may be amended, supplemented or otherwise modified in
accordance with SECTION 7.3(f).
"SCHEDULE" refers to a specific schedule to this Agreement,
unless another document is specifically referenced.
80
88
"SCHEDULED TERMINATION DATE" means June 29, 2000, unless
extended by unanimous agreement of Blue Ridge, Falcon and their respective
Co-Agents and Liquidity Banks.
"SEC" means the Securities and Exchange Commission.
"SECTION" means a numbered section of this Agreement, unless
another document is specifically referenced.
"SECURED PARTIES" means the Agents, the Indemnified Parties
and the Affected Parties.
"SERVICER" has the meaning set forth in the preamble of this
Agreement.
"SERVICER TRANSFER EVENT" means the occurrence of any Event of
Default.
"SERVICER'S FEE" accrued for any day in a Settlement Period
means:
(a) an amount equal to (x) 1.0% PER ANNUM (or, at any time
while INTERIM SERVICES is the Servicer, such lesser percentage as may
be agreed between the Borrower and the Servicer on an arms' length
basis based on then prevailing market terms for similar services),
TIMES (y) the aggregate Unpaid Balance of the Receivables at the close
of business on the first day of such Settlement Period, TIMES (z)
1/360; or
(b) on and after the Servicer's reasonable request made at any
time when INTERIM SERVICES shall no longer be the Servicer, an
alternative amount specified by the Servicer not exceeding (x) 110% of
the Servicer's costs and expenses of performing its obligations under
the Agreement during the Settlement Period when such day occurs,
divided by (y) the number of days in such Settlement Period.
"SERVICING RESERVE" shall mean the product of 1.0% and a
fraction, the numerator of which is the highest Days Sales Outstanding
calculated for each of the most recent 12 Settlement Periods and the denominator
of which is 360.
"SETTLEMENT DATE" means (a) the second Business Day after each
Reporting Date, and such other Business Days as the Co-Agents may specify in a
written notice to the Co-Agents and the Loan Parties, and (b) the Termination
Date.
"SETTLEMENT PERIOD" means: (a) the period from and including
the date of the initial Advance to but excluding the next Cut-Off Date; and (b)
thereafter, each period from and including a Cut-Off Date to the earlier to
occur of the next Cut-Off Date or the Final Payout Date.
"SUBORDINATED LOAN" has the meaning set forth in the Sale
Agreement.
"SUBORDINATED NOTES" has the meaning set forth in the Sale
Agreement.
81
89
"SUBSIDIARY" of any Person means (i) a corporation more than
50% of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned or controlled by such Person,
directly or indirectly through Subsidiaries, and (ii) any partnership,
association, joint venture or other entity in which such Person, directly or
indirectly through Subsidiaries, has more than a 50% equity interest at the
time.
"SUCCESSOR NOTICE" has the meaning set forth in SECTION
8.1(b).
"SUPPLEMENTAL SERVICER'S FEE" accrued for any day in a
Settlement Period means an amount not to exceed (x) 2.0% PER ANNUM, TIMES (y)
the aggregate Unpaid Balance of the Receivables at the close of business on the
first day of such Settlement Period, TIMES (z) 1/360, as agreed between the
Borrower and the Servicer from time to time.
"TERMINATION DATE" means the earliest to occur of:
(a) the Scheduled Termination Date;
(b) the Liquidity Termination Date;
(c) the date designated by the Borrower as the "Termination
Date" on not less than five (5) Business Days' notice to the Co-Agents,
PROVIDED that on such date the Obligations have been paid in full;
(d) the date specified in SECTION 10.2(a) or (b); or
(e) the date on which any one or more Originators whose
Receivables represent more than 50% of all Receivables being sold under
the Sale Agreement as of the Initial Closing Date (under and as defined
therein) cease(s) selling Receivables to the Borrower under the Sale
Agreement.
"TRANSACTION DOCUMENTS" means this Agreement, the Lock-Box
Agreements, the Sale Agreement, the Fee Letters, the Subordinated Notes and the
other documents to be executed and delivered in connection herewith.
"TRANSFEREE" is defined in SECTION 12.4.
"UCC" means the Uniform Commercial Code as from time to time
in effect in the applicable jurisdiction or jurisdictions.
"UNMATURED DEFAULT" means an event which but for the lapse of
time or the giving of notice, or both, would constitute an Event of Default.
"UNPAID BALANCE" of any Receivable means at any time the
unpaid amount thereof, but EXCLUDING all late payment charges, delinquency
charges and extension or collection fees.
82
90
"USAGE FEE" has the meaning set forth in each of the Fee
Letters.
"VOTING BLOCK" has the meaning set forth in SECTION 11.4.
"WACHOVIA" has the meaning set forth in the preamble of this
Agreement.
"WACHOVIA ROLES" has the meaning set forth in SECTION
11.10(a).
"YEAR 2000 COMPLIANT" has the meaning set forth in SECTION
6.1(q).
The foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms.
B. OTHER TERMS. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP. All terms used in Article 9
of the UCC in the State of New York, and not specifically defined herein, are
used herein as defined in such Article 9.
C. 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" and the words
"to" and "until" each mean "to but excluding".
83