Exhibit 10.1
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Dated as of October 8, 2004
Among
LEXMARK RECEIVABLES CORPORATION
as the Seller
and
▇▇▇▇▇▇, LLC
and
GOTHAM FUNDING CORPORATION
as the Investors
and
CITIBANK, N.A.
and
THE BANK OF TOKYO - MITSUBISHI, LTD.,
NEW YORK BRANCH
as Banks
and
CITICORP NORTH AMERICA, INC.
as the Program Agent
and
CITICORP NORTH AMERICA, INC.
and
THE BANK OF TOKYO - MITSUBISHI, LTD.,
NEW YORK BRANCH
as Investor Agents
and
LEXMARK INTERNATIONAL, INC.
as Collection Agent and Originator
TABLE OF CONTENTS
Page
PRELIMINARY STATEMENTS.........................................................5
ARTICLE I......................................................................5
SECTION 1.01. Certain Defined Terms......................................6
SECTION 1.02. Other Terms...............................................30
ARTICLE II....................................................................30
SECTION 2.01. Purchase Facility.........................................30
SECTION 2.02. Making Purchases..........................................31
SECTION 2.03. Receivable Interest Computation...........................32
SECTION 2.04. Settlement Procedures.....................................33
SECTION 2.05. Fees......................................................37
SECTION 2.06. Payments and Computations, Etc............................38
SECTION 2.07. Dividing or Combining Receivable Interests................38
SECTION 2.08. Increased Costs...........................................38
SECTION 2.09. Additional Yield on Receivable Interests Bearing a
Eurodollar Rate....................................................39
SECTION 2.10. Taxes.....................................................39
SECTION 2.11. Security Interest.........................................41
SECTION 2.12. Sharing of Payments.......................................41
ARTICLE III...................................................................42
SECTION 3.01. Conditions Precedent to Initial Purchase..................42
SECTION 3.02. Conditions Precedent to All Purchases and Reinvestments...43
ARTICLE IV....................................................................44
SECTION 4.01. Representations and Warranties of the Seller..............44
SECTION 4.02. Representations and Warranties of the Collection Agent....47
ARTICLE V.....................................................................48
SECTION 5.01. Covenants of the Seller...................................48
SECTION 5.02. Covenant of the Seller and the Originator.................54
ARTICLE VI....................................................................54
SECTION 6.01. Designation of Collection Agent...........................54
SECTION 6.02. Duties of Collection Agent................................55
SECTION 6.03. Certain Rights of the Agents..............................56
SECTION 6.04. Rights and Remedies.......................................57
SECTION 6.05. Further Actions Evidencing Purchases......................58
SECTION 6.06. Covenants of the Collection Agent and the Originator......58
SECTION 6.07. Indemnities by the Collection Agent.......................58
SECTION 6.08. Cash Collateral Account...................................59
ARTICLE VII...................................................................60
2
SECTION 7.01. Events of Termination.....................................60
ARTICLE VIII..................................................................63
SECTION 8.01. Authorization and Action..................................63
SECTION 8.02. Program Agent's Reliance, Etc.............................64
SECTION 8.03. CNAI and Affiliates.......................................64
SECTION 8.04. Indemnification of Program Agent..........................64
SECTION 8.05. Delegation of Duties......................................65
SECTION 8.06. Action or Inaction by Program Agent.......................65
SECTION 8.07. Notice of Events of Termination...........................65
SECTION 8.08. Non-Reliance on Program Agent and Other Parties...........65
SECTION 8.09. Successor Program Agent...................................66
SECTION 8.10. Reports and Notices.......................................66
ARTICLE IX....................................................................66
SECTION 9.01. Authorization and Action..................................66
SECTION 9.02. Investor Agent's Reliance, Etc............................66
SECTION 9.03. Investor Agent and Affiliates.............................67
SECTION 9.04. Indemnification of Investor Agents........................67
SECTION 9.05. Delegation of Duties......................................68
SECTION 9.06. Action or Inaction by Investor Agent......................68
SECTION 9.07. Notice of Events of Termination...........................68
SECTION 9.08. Non-Reliance on Investor Agent and Other Parties..........68
SECTION 9.09. Successor Investor Agent..................................69
SECTION 9.10. Reliance on Investor Agent................................69
ARTICLE X.....................................................................69
SECTION 10.01. Indemnities by the Seller................................69
ARTICLE XI....................................................................71
SECTION 11.01. Amendments, Etc..........................................71
SECTION 11.02. Notices, Etc.............................................71
SECTION 11.03. Assignability............................................71
SECTION 11.04. Costs, Expenses and Taxes................................72
SECTION 11.05. No Proceedings...........................................73
SECTION 11.06. Confidentiality..........................................73
SECTION 11.07. GOVERNING LAW............................................74
SECTION 11.08. Execution in Counterparts................................74
SECTION 11.09. Survival of Termination..................................74
SECTION 11.10. Consent to Jurisdiction..................................74
SECTION 11.11. WAIVER OF JURY TRIAL.....................................75
3
SCHEDULES
SCHEDULE I - Lock-Box Banks
SCHEDULE II - Credit and Collection Policy
ANNEXES
ANNEX A-1 - Form of Monthly Report
ANNEX A-2 - Form of Weekly Report
ANNEX A-3 - Form of Daily Report
ANNEX B - Form of Lock-Box Agreement
ANNEX C - Form of Opinion of Counsel to
the Seller
ANNEX D - Assignment and Acceptance
ANNEX E - Form of Funds Transfer Letter
4
AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT
Dated as of October 8, 2004
LEXMARK RECEIVABLES CORPORATION, a Delaware corporation (the "Seller"),
▇▇▇▇▇▇, LLC, a New York limited liability company, as an Investor (as defined
herein), GOTHAM FUNDING CORPORATION, a Delaware corporation, as an Investor,
CITIBANK, N.A., as a Bank (as defined herein), THE BANK OF TOKYO-MITSUBISHI,
LTD., NEW YORK BRANCH, as a Bank and an Investor Agent (as defined herein),
CITICORP NORTH AMERICA, INC., a Delaware corporation ("CNAI"), as program agent
(the "Program Agent") for the Investors and the Banks and as an Investor Agent,
and LEXMARK INTERNATIONAL, INC., a Delaware corporation, as Collection Agent and
Originator, agree as follows:
PRELIMINARY STATEMENTS.
(1) Seller has acquired, and may continue to acquire, Receivables from the
Originator (as hereinafter defined), either by purchase or by contribution to
the capital of the Seller, as determined from time to time by the Seller and the
Originator. The Seller is prepared to sell undivided fractional ownership
interests (referred to herein as "Receivable Interests") in the Receivables (as
such term is defined herein).
(2) The Seller, the Program Agent, the Originator, ▇▇▇▇▇▇ and Citibank (as
such terms are hereinafter defined) are parties to a certain Receivables
Purchase Agreement dated as of October 22, 2001, as heretofore amended (as so
amended, the "Original Agreement"), pursuant to which, on the terms and subject
to the conditions set forth therein, ▇▇▇▇▇▇ may, in its sole discretion,
purchase Receivable Interests and Citibank is prepared to purchase such
Receivable Interests.
(3) Gotham (as hereinafter defined) intends to, from time to time, purchase
Receivable Interests (as hereinafter defined) and BTM (as hereinafter defined)
is prepared to purchase such Receivable Interests, in each case on the terms set
forth herein.
(4) The parties hereto wish to amend and restate in its entirety the
Original Agreement to reflect, among other things, the purchase of Receivable
Interests by Gotham and BTM and further amendments thereto agreed upon by the
parties.
NOW, THEREFORE, the parties hereto agree that the Original Agreement is
amended and restated in its entirety as follows:
ARTICLE I
DEFINITIONS
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SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Adjusted Eurodollar Rate" means, for any Fixed Period, an interest rate
per annum equal to the rate per annum obtained by dividing (i) the Eurodollar
Rate for such Fixed Period by (ii) a percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage for such Fixed Period.
"Adverse Claim" means a lien, security interest or other charge or
encumbrance, or any other type of preferential arrangement.
"Affected Person" has the meaning specified in Section 2.08(a).
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by or is under common control with
such Person or is a director or officer of such Person.
"Affiliated Obligor" means any Obligor that is an Affiliate of another
Obligor.
"Agent" means any of the Program Agent or any Investor Agent and "Agents"
means, collectively, the Program Agent and the Investor Agents.
"Allocation Percentage" means, at any time, the sum of the Receivable
Interest percentages at such time, based on the information in the most recent
Daily Report.
"Alternate Base Rate" means a fluctuating interest rate per annum as shall
be in effect from time to time, which rate shall be at all times equal to the
highest of:
(a) the rate of interest announced publicly by Citibank in New York, New
York, from time to time as Citibank's base rate;
(b) 1/2 of one percent above the latest three-week moving average of
secondary market morning offering rates in the United States for three-month
certificates of deposit of major United States money market banks, such
three-week moving average being determined weekly on each Monday (or, if such
day is not a Business Day, on the next succeeding Business Day) for the
three-week period ending on the previous Friday by Citibank on the basis of such
rates reported by certificate of deposit dealers to and published by the Federal
Reserve Bank of New York or, if such publication shall be suspended or
terminated, on the basis of quotations for such rates received by Citibank from
three New York certificate of deposit dealers of recognized standing selected by
Citibank, in either case adjusted to the nearest 1/4 of one percent or, if there
is no nearest 1/4 of one percent, to the next higher 1/4 of one percent; and
(c) the Federal Funds Rate.
"Applicable Margin" means, at any time, a rate per annum equal to the sum
of (x) the "Applicable Margin" as defined in the Credit Facility plus (y) 0.25%.
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"Asset Purchase Agreement" means (a) in the case of any Bank other than
Citibank and BTM, the asset purchase agreement entered into by such Bank
concurrently with the Assignment and Acceptance pursuant to which it became
party to this Agreement and (b) in the case of Citibank and BTM, the secondary
market agreement, asset purchase agreement or other similar liquidity agreement
entered into by such Bank for the benefit of its respective Investor, to the
extent relating to the sale or transfer of interests in Receivable Interests, in
each case as amended or modified from time to time.
"Assignee Rate" for any Fixed Period for any Receivable Interest means an
interest rate per annum equal to the Applicable Margin at such time plus the
Eurodollar Rate for such Fixed Period; provided, however, that in case of:
(i) any Fixed Period on or prior to the first day of which an Investor or
Bank shall have notified the Program Agent and each Investor Agent that the
introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for such Investor or Bank to fund such
Receivable Interest at the Assignee Rate set forth above (and such Investor or
Bank shall not have subsequently notified the Program Agent and each Investor
Agent that such circumstances no longer exist),
(ii) any Fixed Period of one to (and including) 29 days (it being
understood and agreed that this clause (ii) shall not be applicable to a Fixed
Period for which Yield is to be computed by reference to the Eurodollar Rate
that is intended to have a one-month duration but due solely to LIBOR interest
period convention the duration thereof will be less than 30 days),
(iii) any Fixed Period as to which the Program Agent and each Investor
Agent does not receive notice, by no later than 12:00 noon (New York City time)
on the third Business Day preceding the first day of such Fixed Period, that the
related Receivable Interest will not be funded by ▇▇▇▇▇▇ and Gotham through the
issuance of commercial paper or
(iv) any Fixed Period for a Receivable Interest the Capital of which
allocated to the Investors or the Banks is less than $500,000,
the "Assignee Rate" for such Fixed Period shall be an interest rate per annum
equal to the Alternate Base Rate in effect from time to time during such Fixed
Period; provided further that the Agents and the Seller may agree in writing
from time to time upon a different "Assignee Rate".
"Assignment and Acceptance" means an assignment and acceptance agreement
entered into by a Bank, an Eligible Assignee, such Bank's Investor Agent and the
Program Agent, pursuant to which such Eligible Assignee may become a party to
this Agreement, in substantially the form of Annex D hereto.
"Bank Commitment" of any Bank means, (a) with respect to Citibank,
$100,000,000 or such amount as reduced or increased by any Assignment and
Acceptance entered into among Citibank, another Bank, the Investor Agent for
Citibank and the Program Agent, (b) with respect to BTM, $100,000,000 or such
amount as reduced or increased by any Assignment and Acceptance entered into
among BTM, another Bank, the Investor Agent for
7
BTM and the Program Agent or (c) with respect to a Bank (other than Citibank or
BTM) that has entered into an Assignment and Acceptance, the amount set forth
therein as such Bank's Bank Commitment, in each case as such amount may be
reduced or increased by an Assignment and Acceptance entered into among such
Bank, an Eligible Assignee, the Investor Agent for such Bank and the Program
Agent, and as may be further reduced (or terminated) pursuant to the next
sentence. Any reduction (or termination) of the Purchase Limit pursuant to the
terms of this Agreement shall reduce ratably (or terminate) each Bank's Bank
Commitment; provided that if the Investors and Banks in any Group (the
"Departing Group") shall determine not to extend the Commitment Termination Date
or shall approve an extension of the Commitment Termination Date based on a
reduced Investor Purchase Limit for their Group, then, if the Investors and the
Banks in the other Groups shall nonetheless determine to extend the Commitment
Termination Date, effective from such Commitment Termination Date, the Bank
Commitment of each Bank in the Departing Group shall be terminated or reduced
(ratably, or as otherwise mutually agreed by such Banks). Upon such termination
or reduction, the Banks in the other Groups shall have the option of increasing
their Bank Commitment by up to the full amount of such termination or reduction
(the "Bank Commitment Increase Option"). If, within 30 days of notice from the
Departing Group that the Departing Group intends to reduce or terminate its Bank
Commitment, the Banks in the other Groups choose not to exercise the Bank
Commitment Increase Option in full, the Seller shall be permitted to bring in
other financial institutions as Banks and Investors hereunder under the terms
herein for the remaining Bank Commitment amount.
"Bank Commitment Increase Option" has the meaning specified within the
definition of "Bank Commitment" in this Section 1.01.
"Banks" means Citibank, BTM and each Eligible Assignee that shall become a
party to this Agreement pursuant to Section 11.03.
"BTM" means The Bank of Tokyo-Mitsubishi, Ltd., New York Branch, a Japanese
banking corporation acting through its New York Branch.
"Business Day" means any day on which (i) banks are not authorized or
required to close in New York City, and (ii) if this definition of "Business
Day" is utilized in connection with the Eurodollar Rate, dealings are carried
out in the London interbank market.
"Capital" of any Receivable Interest means the original amount paid to the
Seller for such Receivable Interest at the time of its purchase by an Investor
or a Bank pursuant to this Agreement, or such amount divided or combined in
accordance with Section 2.07, in each case reduced from time to time by
Collections distributed on account of such Capital pursuant to Section 2.04(d);
provided that if such Capital shall have been reduced by any distribution and
thereafter all or a portion of such distribution is rescinded or must otherwise
be returned for any reason, such Capital shall be increased by the amount of
such rescinded or returned distribution, as though it had not been made.
"Cash Collateral Account" has the meaning specified in Section 6.08.
"Cash Collateral Agreement" has the meaning specified in Section 6.08.
"Cash Collateral Bank" has the meaning specified in Section 6.08.
8
"Cash Control Triggering Event" means the occurrence of any of the
following: (i) (A) the Program Agent shall send a notice of an Event of
Termination or (B) an Event of Termination under Section 7.01(g) shall occur,
(ii) an Incipient Event of Termination shall occur pursuant to Section 7.01(c),
(iii) there shall occur (in the Program Agent's and each Investor Agent's
reasonable judgment) a material adverse change in collectibility of more than
20% of the Receivables in the Receivables Pool or (iv) a Level II Downgrade
Event shall occur.
"▇▇▇▇▇▇" means ▇▇▇▇▇▇, LLC and any successor or assign of ▇▇▇▇▇▇ that is a
receivables investment company which in the ordinary course of its business
issues commercial paper or other securities to fund its acquisition and
maintenance of receivables.
"Citibank" means Citibank, N.A., a national banking association. --------
"CNAI" has the meaning specified in the introductory paragraph hereof.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collection Agent" means at any time the Person then authorized pursuant to
Section 6.01 to administer and collect Pool Receivables.
"Collection Agent Default" means the occurrence of an Event of Termination
described in Sections 7.01(a), 7.01(c), 7.01(e) or 7.01(g), in each case with
respect to the Collection Agent. "Collection Agent Fee" has the meaning
specified in Section 2.05(a).
"Collection Delay Period" means 10 days.
"Collections" means, with respect to any Receivable, all cash collections
and other cash proceeds of such Receivable, including, without limitation, all
cash proceeds of Related Security with respect to such Receivable, and any
Collection of such Receivable deemed to have been received pursuant to Section
2.04.
"Commitment Termination Date" means the earliest of (a) October 7, 2005,
unless, prior to such date (or the date so extended pursuant to this clause),
upon the Seller's request, made not more than 90 nor less than 45 days prior to
the then Commitment Termination Date, each Investor and, with respect to each
such Investor, one or more of its Related Banks which, immediately after giving
effect to such extension would have Bank Commitments in an aggregate amount
equal to such Investor's Investor Purchase Limit to be in effect immediately
after giving effect to such extension, shall in their sole discretion consent,
which consent shall be given not more than 30 days prior to the then Commitment
Termination Date, to the extension of the Commitment Termination Date to the
date occurring not more than 364 days after the then Commitment Termination
Date; provided, however, that any failure of any Investor or Bank to respond to
the Seller's request for such extension shall be deemed a denial of such request
by such Bank, (b) the Facility Termination Date (provided that if the Facility
Termination Date shall occur solely under clause (d) of such defined term, the
Commitment Termination Date shall occur only with respect to the Investor and
Banks for which such Facility Termination Date
9
occurred under clause (d)), (c) the date determined pursuant to Section 7.01,
and (d) the date the Purchase Limit reduces to zero pursuant to Section 2.01(b).
"Concentration Limit" at any time means (x) for any Group A Obligor, 20%,
(y) for any Group B Obligor, 10%, and (z) for any Group C Obligor 5%, or such
other higher percentage ("Special Concentration Limit") for such Obligor or
Obligor Group designated by the Program Agent and each Investor Agent in a
writing delivered to the Seller (with a copy to each of the other Agents);
provided that in the case of an Obligor with any Affiliated Obligor, the
Concentration Limit shall be calculated as if such Obligor and such Affiliated
Obligor are one Obligor; provided further that the Program Agent and any
Investor Agent may reduce or cancel any Special Concentration Limit upon three
Business Days' notice to the Seller (with a copy to each of the other Agents).
"Consolidated EBITDA" has the meaning set forth in such definition in the
Credit Facility as in effect on the date hereof and any additional defined terms
used in such definition shall have their meanings as in effect on the date
hereof.
"Consolidated Interest Coverage Ratio" means, for any period, the ratio of
(a) Consolidated EBITDA for such period to (b) Consolidated Interest Expense for
such period.
"Consolidated Interest Expense" has the meaning set forth in such
definition in the Credit Facility as in effect on the date hereof and any
additional defined terms used in such definition shall have their meanings as in
effect on the date hereof.
"Consolidated Leverage Ratio" means, at any date, the ratio of (a)
Consolidated Total Debt on such date to (b) Consolidated EBITDA for the period
of four consecutive fiscal quarters ending with the most recent fiscal quarter
for which the relevant financial information is available.
"Consolidated Total Debt" has the meaning set forth in such definition in
the Credit Facility as in effect on the date hereof and any additional defined
terms used in such definition shall have their meanings as in effect on the date
hereof.
"Contract" means an agreement between the Originator and an Obligor,
substantially in the form of one of the written contracts or (in the case of any
open account agreement) one of the invoices approved by the Program Agent,
pursuant to or under which such Obligor shall be obligated to pay for
merchandise, insurance or services from time to time.
"CP Fixed Period Date" means, for any Receivable Interest, the date of
purchase of such Receivable Interest and thereafter the 20th day of each
calendar month (or, if such day is not a Business Day, the immediately
succeeding Business Day) or any other day as shall have been agreed to in
writing by the Program Agent, the Investor Agents and the Seller prior to the
first day of the preceding Fixed Period for such Receivable Interest or, if
there is no preceding Fixed Period, prior to the first day of such Fixed Period.
"Credit and Collection Policy" means those receivables credit and
collection policies and practices of the Seller and the Originator in effect on
the date of this Agreement and described in Schedule II hereto, as modified in
compliance with this Agreement.
10
"Credit Facility" means the Multicurrency Revolving Credit Agreement, dated
as of May 29, 2002, among the Originator, as borrower, the lenders party
thereto, Fleet National Bank, as administrative agent with Fleet Securities,
Inc. having acted as arranger, JPMorgan Chase Bank and Citicorp USA, Inc. as
co-syndication agents and Key Corporate Capital Inc. and Suntrust Bank as
co-documentation agents, as amended, restated, modified or supplemented from
time to time, and all agreements, documents and instruments executed in
connection therewith together with any replacement facility or refinancing
thereof entered into by the Originator.
"Cure Period" means the period beginning on and including a Pool
Non-compliance Date and ending on but excluding the earlier of (a) the first
date thereafter on which the Net Receivables Pool Balance equals or exceeds the
Required Net Receivables Pool Balance and (b) the Business Day following the
delivery of the next Daily Report.
"Daily Report" means a report in substantially the form of Annex A-3 hereto
and containing such additional information as the Program Agent or any Investor
Agent may reasonably request from time to time, furnished by the Collection
Agent to the Program Agent and each Investor Agent pursuant to Section
6.02(g)(iii) following the occurrence of a Level II Downgrade Event.
"Days Sales Outstanding" means, on any date, an amount equal to
[OBPR x 91] + CDP
----
S
where:
OBPR = the aggregate Outstanding Balance
of all Receivables at the end of the
most recently ended month.
S = the aggregate Outstanding Balance
(in each case at the time of
creation) of all Receivables created
during the most recently ended three
month period.
CDP = the Collection Delay Period.
"Debt" means (i) indebtedness for borrowed money, (ii) obligations
evidenced by bonds, debentures, notes or other similar instruments, (iii)
obligations to pay the deferred purchase price of property or services (but
excluding trade accounts payable or accrued liabilities arising in the ordinary
course of business consistent with past practices), (iv) obligations as lessee
under leases which shall have been or should be, in accordance with GAAP,
recorded as capital leases, and (v) obligations under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to purchase
or otherwise acquire, or otherwise to assure a creditor against loss in respect
of, indebtedness or obligations of others of the kinds referred to in clauses
(i) through (iv) above.
"Debt Rating" for any Person, means the rating by S&P or ▇▇▇▇▇'▇ of such
Person's long-term public senior unsecured non-credit-enhanced debt.
11
"Default Ratio" means the ratio (expressed as a percentage) computed as of
the last day of each calendar month by dividing (i) the sum of the aggregate
Outstanding Balances of all Originator Receivables that were Defaulted
Receivables as of the last day of each of the three most recently ended calendar
months (including the calendar month then ending), or that would have been
Defaulted Receivables as of the last day of the applicable month had they not
been written off the books of the Originator or the Seller during the applicable
month, by (ii) the sum of the aggregate Outstanding Balances of all Originator
Receivables as of the last day of each of the three most recently ended calendar
months (including the calendar month then ending).
"Defaulted Receivable" means an Originator Receivable:
(i) as to which any payment, or part thereof, remains unpaid for 91 or more
days from the original due date for such payment;
(ii) as to which the Obligor thereof or any other Person obligated thereon
or owning any Related Security in respect thereof has taken any action, or
suffered any event to occur, of the type described in Section 7.01(g); or
(iii) which, consistent with the Credit and Collection Policy, would be
written off the Originator's or the Seller's books as uncollectible.
"Deferred Purchase Price" has the meaning specified in the Originator
Purchase Agreement.
"Delinquency Ratio" means the ratio (expressed as a percentage) computed as
of the last day of each calendar month by dividing (i) the aggregate Outstanding
Balances of all Originator Receivables that were Delinquent Receivables as of
the last day of each of the three most recently ended calendar months (including
the calendar month then ending) by (ii) the aggregate Outstanding Balances of
all Originator Receivables as of the last day of each of the three most recently
ended calendar months (including the calendar month then ending).
"Delinquent Receivable" means an Originator Receivable that is not a
Defaulted Receivable and:
(i) as to which any payment, or part thereof, remains unpaid for 31 or more
days from the original due date for such payment; or
(ii) which, consistent with the Credit and Collection Policy, would be
classified as delinquent by the Originator or the Seller.
"Departing Group" has the meaning specified within the definition of "Bank
Commitment" in this Section 1.01.
"Deposit Date" means each day on which any Collections are deposited in any
of the Lock-Box Accounts or on which the Collection Agent shall receive
Collections of Pool Receivables.
12
"Designated Obligor" means, at any time, each Obligor; provided, however,
that with respect to any Group C Obligor, if the Program Agent or any Investor
Agent has determined to de-designate such Designated Obligor for bona fide
credit-related reasons, such Group C Obligor shall cease to be a Designated
Obligor upon three Business Days' notice by such Agent to the Seller and the
other Agents.
"Diluted Receivable" means that portion (and only that portion) of any
Originator Receivable which is either (a) reduced or canceled as a result of (i)
any defective, rejected or returned merchandise or services or any failure by
the Originator to deliver any merchandise or provide any services or otherwise
to perform under the underlying Contract or invoice, (ii) any change in the
terms of or cancellation of, a Contract or invoice or any cash discount,
discount for quick payment or other adjustment by the Originator which reduces
the amount payable by the Obligor on the related Originator Receivable (except
any such change or cancellation resulting from or relating to the financial
inability to pay or insolvency of the Obligor of such Originator Receivable) or
(iii) any set-off by an Obligor in respect of any claim by such Obligor as to
amounts owed by it on the related Originator Receivable (whether such claim
arises out of the same or a related transaction or an unrelated transaction) or
(b) subject to any specific dispute, offset, counterclaim or defense whatsoever
(except the discharge in bankruptcy of the Obligor thereof); provided that
Diluted Receivables are calculated assuming that all chargebacks are resolved in
the Obligor's favor and do not include contractual adjustments to the amount
payable by an Obligor that are eliminated from the Originator Receivables
balance sold to the Seller through a reduction in the purchase price for the
related Originator Receivable.
"Dilution Horizon Factor" means, as of any date, a ratio computed by
dividing (i) the aggregate original Outstanding Balance of all Originator
Receivables created by the Originator during the three most recently ended
calendar months by (ii) the Outstanding Balance of Originator Receivables (other
than Defaulted Receivables) as at the last day of the most recently ended
calendar month.
"Dilution Percentage" means, as of any date, the product of (a) the sum of
(i) the product of (x) 1.5, multiplied by (y) the average of the Dilution Ratios
for each of the twelve most recently ended calendar months, plus (ii) the
Dilution Volatility Ratio as at the last day of the most recently ended calendar
month, multiplied by (b) the Dilution Horizon Factor as of such date.
"Dilution Ratio" means, as of any date, the ratio (expressed as a
percentage) computed for the most recently ended calendar month by dividing (i)
the aggregate amount of Originator Receivables which became Diluted Receivables
during such calendar month by (ii) the aggregate Outstanding Balance (in each
case, at the time of creation) of all Originator Receivables created during the
third calendar month immediately preceding such calendar month.
"Dilution Reserve" means, for any Receivable Interest on any date $0,
unless (i) a Dilution Reserve Trigger Event (but no Level I Downgrade Event)
shall have occurred and be continuing in which case the "Dilution Reserve" for
each Receivable Interest on such date shall be an amount equal to:
13
0.5 x ADR x NPRB
where:
ADR = the average Dilution Ratio for the twelve most
recently ended months.
NRPB = the Net Receivables Pool Balance at the time of
computation;
or (ii) a Level I Downgrade Event shall have occurred and be continuing in which
case the "Dilution Reserve" for each Receivable Interest on such date shall be
an amount equal to:
DP x NRPB
where:
DP = the Dilution Percentage for such Receivable Interest
on such date.
NRPB = the Net Receivables Pool Balance at the time of
computation.
"Dilution Reserve Trigger Event" means the Debt Rating of the Originator is
rated lower than BBB by S&P or lower than Baa2 by ▇▇▇▇▇'▇ but no Level I
Downgrade Event shall have occurred and be continuing.
"Dilution Volatility Ratio" means, as of any date, a ratio (expressed as a
percentage) equal to the product of (a) the highest of the Dilution Ratios
calculated for each of the twelve most recently ended calendar months minus the
average of the Dilution Ratios for each of the twelve most recently ended
calendar months, and (b) a ratio calculated by dividing the highest of the
Dilution Ratios calculated for each of the twelve most recently ended calendar
months by the average of the Dilution Ratios for each of the twelve most
recently ended calendar months.
"Downgraded Loss Horizon Factor" means, as of any date, a ratio computed by
dividing (i) the aggregate Outstanding Balance (in each case, at the time of
creation) of all Originator Receivables created by the Originator during the
four most recently ended calendar months by (ii) the Outstanding Balance of
Originator Receivables (other than Defaulted Receivables) as at the last day of
the most recently ended calendar month.
"Downgraded Loss Percentage" means, as of any date, the greatest of (a) the
product of (i) two multiplied by (ii) the Downgraded Loss Horizon Factor as of
the last day of the most recently ended calendar month multiplied by (iii) the
highest of the Downgraded Loss Ratios for the twelve most recently ended
calendar months, (b) four times the Concentration Limit applicable to Group C
Obligors and (c) 20%.
"Downgraded Loss Ratio" means, as of any date, the average of the ratios
(each expressed as a percentage) for each of the three most recently ended
calendar months computed for each such month by dividing (a) the sum of the
aggregate Outstanding Balance of Originator
14
Receivables which were 91-120 days past due (or otherwise would have been
classified during such month as Defaulted Receivables in accordance with clauses
(ii) or (iii) of the definition of "Defaulted Receivables") as at the last day
of such month plus (without duplication) write-offs (which are less than 91 days
past due) during such month, by (b) the aggregate Outstanding Balance (in each
case, at the time of creation) of Originator Receivables created during the
fourth preceding month.
"E-Mail Report" has the meaning specified in Section 6.02(g).
"Eligible Assignee" means (a) with respect to the Group which includes
▇▇▇▇▇▇, (i) CNAI or any of its Affiliates, (ii) any Person managed by Citibank,
CNAI or any of their Affiliates or (iii) any financial or other institution
acceptable to the Investor Agent for such Group and (b) with respect to the
Group which includes Gotham, (i) BTM or any of its Affiliates, (ii) any Person
managed by BTM or any of its Affiliates or (iii) any financial or other
institution acceptable to the Investor Agent for such Group.
"Eligible Receivable" means, at any time, a Receivable:
(i) the Obligor of which is a United States resident (and shall include
without limitation, Government Obligors, state and local governments of
jurisdictions located in the United States, or any agency or subdivision
thereof) and is not an Affiliate of any of the parties hereto;
(ii) the Obligor of which, at the later of the date of this Agreement and
the date such Receivable is created, is a Designated Obligor;
(iii) which is not a Defaulted Receivable and the Obligor of which is not
the Obligor of any Defaulted Receivables which in the aggregate constitute 25%
or more of the aggregate Outstanding Balance of all Receivables of such Obligor;
(iv) which, according to the Contract related thereto, is required to be
paid in full within 90 days of the original billing date therefor;
(v) which is an obligation representing all or part of the sales price of
merchandise, insurance or services within the meaning of Section 3(c)(5) of the
Investment Company Act of 1940, as amended, and the nature of which is such that
its purchase with the proceeds of notes would constitute a "current transaction"
within the meaning of Section 3(a)(3) of the Securities Act of 1933, as amended;
(vi) which is an "account" within the meaning of Article 9 of the UCC of
the applicable jurisdictions governing the perfection of the interest created by
a Receivable Interest;
(vii) which is denominated and payable only in United States dollars in the
United States;
(viii) which arises under a Contract which, together with such Receivable,
is in full force and effect and constitutes the legal, valid and binding
obligation of the Obligor of such
15
Receivable and is not subject to any Adverse Claim or any dispute, offset,
counterclaim or defense whatsoever (except the potential discharge in bankruptcy
of such Obligor);
(ix) which, together with the Contract related thereto, does not contravene
in any material respect any laws, rules or regulations applicable thereto
(including, without limitation, laws, rules and regulations relating to usury,
consumer protection, truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection practices and privacy)
and with respect to which none of the Seller, the Originator, the Collection
Agent (other than a Collection Agent designated by the Program Agent pursuant to
Section 6.01 hereof) or the Obligor is in violation of any such law, rule or
regulation in any material respect;
(x) Intentionally omitted;
(xi) which was generated in the ordinary course of the Originator's
business;
(xii) which has not been extended, rewritten or otherwise modified from the
original terms thereof (except as permitted by Section 6.02(c);
(xiii) the transfer, sale or assignment of which does not contravene any
applicable law, rule or regulation;
(xiv) which satisfies all applicable requirements of the Credit and
Collection Policy; and
(xv) as to which, at or prior to the later of the date of this Agreement
and the date such Receivable is created, an Investor Agent has not notified the
Seller that such Receivable (or class of Receivables) is no longer acceptable
for purchase hereunder by any Investor or any Bank for which such Investor Agent
is acting as Investor Agent for bona fide credit-related reasons.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any trade or business (whether or not incorporated)
that, together with the Seller, is treated as a single employer under Section
414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and
Section 412 of the Code, is treated as a single employer under Section 414 of
the Code.
"ERISA Event" means (a) any "reportable event", as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other than
an event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an "accumulated funding deficiency" (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any
Plan; (d) the incurrence by the Seller or any ERISA Affiliate of any liability
under Title IV of ERISA with respect to the termination of any Plan; (e) the
receipt by the Seller or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the incurrence by
16
the Seller or any ERISA Affiliate of any liability with respect to the
withdrawal or partial withdrawal form any Plan or Multiemployer Plan; or (g) the
receipt by the Seller or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Seller or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization,
within the meaning of Title IV of ERISA.
"Eurocurrency Liabilities" has the meaning assigned to that term in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time.
"Eurodollar Rate" means, for any Fixed Period, an interest rate per annum
equal to the rate per annum at which deposits in U.S. dollars are offered by the
principal office of Citibank in London, England to prime banks in the London
interbank market at 11:00 A.M. (London Time) two Business Days before the first
day of such Fixed Period in an amount substantially equal to the Capital
associated with such Fixed Period on such first day and for a period equal to
such Fixed Period.
"Eurodollar Rate Reserve Percentage" of any Investor or Bank for any Fixed
Period in respect of which Yield is computed by reference to the Eurodollar Rate
means the reserve percentage applicable two Business Days before the first day
of such Fixed Period under regulations issued from time to time by the Board of
Governors of the Federal Reserve System (or any successor) (or if more than one
such percentage shall be applicable, the daily average of such percentages for
those days in such Fixed Period during which any such percentage shall be so
applicable) for determining the maximum reserve requirement (including, without
limitation, any emergency, supplemental or other marginal reserve requirement)
for such Investor or Bank with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other category of
liabilities that includes deposits by reference to which the interest rate on
Eurocurrency Liabilities is determined) having a term equal to such Fixed
Period.
"Event of Termination" has the meaning specified in Section 7.01.
"Excluded Receivables" means the indebtedness of (i) KeyTronicEMS Co., (ii)
any Obligor located outside of the fifty states of the United States and the
District of Columbia, but solely to the extent such indebtedness arises from
goods having a final destination or services rendered exclusively outside of the
fifty states of the United States and the District of Columbia, and (iii) any
Obligor of the managed print services business of the Originator (formerly known
as Lexmark Solution Services) (but only with respect to such Obligor's
indebtedness to the Lexmark Solution Services business), in each case resulting
from the provision or sale of merchandise, insurance or services by the
Originator under a Contract.
"Facility Termination Date" means, unless extended, the earliest of (a)
October 16, 2007 or (b) the date determined pursuant to Section 7.01 or (c) the
date the Purchase Limit reduces to zero pursuant to Section 2.01(b) or (d) the
date the Asset Purchase Agreement of any Bank expires without being renewed
(provided that under this clause (d), the Facility Termination Date shall occur
solely with respect to the Investors and Banks in such Bank's Group).
17
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such
transactions received by the Program Agent from three Federal funds brokers of
recognized standing selected by it.
"Fee Agreements" has the meaning specified in Section 2.05(b).
"Fees" has the meaning specified in Section 2.05(b).
"Fixed Period" means, with respect to any Receivable Interest:
(a) in the case of any Fixed Period in respect of which Yield is computed
by reference to the Investor Rate, each successive period commencing on
each CP Fixed Period Date for such Receivable Interest and ending on the
next succeeding CP Fixed Period Date for such Receivable Interest; and
(b) in the case of any Fixed Period in respect of which Yield is computed
by reference to the Assignee Rate, each successive period of from one to
and including 29 days, or a period of one, two or three months, as the
Seller shall select and the Investor Agent for the relevant Investor or
Bank may approve on notice by the Seller received by such Investor Agent
(including notice by telephone, confirmed in writing) not later than 11:00
A.M. (New York City time) on (A) the day which occurs three Business Days
before the first day of such Fixed Period (in the case of Fixed Periods in
respect of which Yield is computed by reference to the Eurodollar Rate) or
(B) the first day of such Fixed Period (in the case of Fixed Periods in
respect of which Yield is computed by reference to the Alternate Base
Rate), each such Fixed Period for such Receivable Interest to commence on
the last day of the immediately preceding Fixed Period for such Receivable
Interest (or, if there is no such Fixed Period, on the date of purchase of
such Receivable Interest), except that if such Investor Agent shall not
have received such notice, or such Investor Agent and the Seller shall not
have so mutually agreed, before 11:00 A.M. (New York City time) on such
day, such Fixed Period shall be one day;
provided, however, that:
(i) any Fixed Period (other than of one day) which would otherwise end
on a day which is not a Business Day shall be extended to the next
succeeding Business Day (provided, however, if Yield in respect of
such Fixed Period is computed by reference to the Eurodollar Rate, and
such Fixed Period would otherwise end on a day which is not a Business
Day, and there is no subsequent Business Day in the same calendar
month as
18
such day, such Fixed Period shall end on the next preceding Business
Day);
(ii) in the case of any Fixed Period of one day, (A) if such Fixed
Period is the initial Fixed Period for a Receivable Interest, such
Fixed Period shall be the day of the purchase of such Receivable
Interest; (B) any subsequently occurring Fixed Period which is one day
shall, if the immediately preceding Fixed Period is more than one day,
be the last day of such immediately preceding Fixed Period and, if the
immediately preceding Fixed Period is one day, be the day next
following such immediately preceding Fixed Period; and (C) if such
Fixed Period occurs on a day immediately preceding a day which is not
a Business Day, such Fixed Period shall be extended to the next
succeeding Business Day; and
(iii) in the case of any Fixed Period for any Receivable Interest
which commences before the Termination Date for such Receivable
Interest and would otherwise end on a date occurring after such
Termination Date, such Fixed Period shall end on such Termination Date
and the duration of each Fixed Period which commences on or after the
Termination Date for such Receivable Interest shall be of such
duration (including, without limitation, one day) as shall be selected
by the Program Agent with the consent of the Investor Agents (or, if
such Termination Date occurs solely as a result of the occurrence of a
Facility Termination Date under clause (d) of the defined term
Facility Termination Date for less than all the Groups, as shall be
selected by the Investor Agent for the Investor and Banks for which
such Facility Termination Date under clause (d) is applicable) or, in
the absence of any such selection, each period of thirty days from the
last day of the immediately preceding Fixed Period.
"Funds Transfer Letter" means a letter in substantially the form of Annex E
hereto executed and delivered by the Seller to the Program Agent and the
Investor Agents, as the same may be amended or restated in accordance with the
terms thereof.
"GAAP" means generally accepted accounting principles in the United States
of America.
"Gotham" means Gotham Funding Corporation, a Delaware corporation and any
successor or assign of Gotham which in the ordinary course of its business
issues commercial paper or other securities.
"Government Obligor" means an Obligor which is the federal government of
the United States of America or a subdivision or agency thereof.
"Group" means (a) with respect to ▇▇▇▇▇▇, its Investor Agent, its Related
Banks and ▇▇▇▇▇▇, and (b) with respect to Gotham, its Investor Agent, its
Related Banks and Gotham.
"Group A Obligor" means any Obligor whose (or if such Obligor is a
subsidiary of another Person, whose ultimate parent's) unsecured short-term
senior non-credit-enhanced
19
debt, is rated no lower than A-1 by S&P and P-1 by ▇▇▇▇▇'▇, if such rating
exists, or if such Obligor's unsecured short-term senior non-credit-enhanced
debt is not rated by either S&P or ▇▇▇▇▇'▇, such Obligor's Debt Rating, if such
rating exists, is no lower than A by S&P and A2 by ▇▇▇▇▇'▇; provided, that if
none of the foregoing ratings exist, such Obligor shall not be a "Group A
Obligor".
"Group B Obligor" means any Obligor (i) which is not a Group A Obligor and
(ii) whose (or if such Obligor is a subsidiary of another Person, whose ultimate
parent's) unsecured short-term senior non-credit-enhanced debt is rated no lower
than A-3 by S&P and P-3 by ▇▇▇▇▇'▇, if such rating exists, or if such Obligor's
unsecured short-term senior non-credit-enhanced debt is not rated by either S&P
or ▇▇▇▇▇'▇, such Obligor's Debt Rating is no lower than BBB- by S&P and Baa3 by
▇▇▇▇▇'▇; provided, that if none of the foregoing ratings exist, such Obligor
shall not be a "Group B Obligor".
"Group C Obligor" means any Obligor which is not a Group A Obligor or a
Group B Obligor.
"Incipient Event of Termination" means an event that but for notice or
lapse of time or both would constitute an Event of Termination.
"Indemnified Party" has the meaning specified in Section 10.01.
"Investor" means ▇▇▇▇▇▇, Gotham and all other owners by assignment or
otherwise of a Receivable Interest originally purchased by ▇▇▇▇▇▇, Gotham and,
to the extent of the undivided interests so purchased, shall include any
participants.
"Investor Agent" means (a) with respect to ▇▇▇▇▇▇ and its Related Banks,
CNAI or any successor investor agent designated by such parties, and (b) with
respect to Gotham and its Related Banks, BTM or any successor investor agent
designated by such parties.
"Investor Agent's Account" means (a) with respect to ▇▇▇▇▇▇ and its Related
Banks, the special account (account number ▇▇▇▇▇▇▇▇) of their Investor Agent
maintained at the office of Citibank at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, or
such other account as such Investor Agent shall designate in writing to the
Seller, the Collection Agent and the Program Agent, and (b) with respect to
Gotham and its Related Banks, the special account (account number 310035147) of
their Investor Agent maintained at the office of BTM at 1251 Avenue of the
Americas, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or such other account as such Investor Agent
shall designate in writing to the Seller, the Collection Agent and the Program
Agent.
"Investor Purchase Limit" means (a) with respect to the Group consisting of
▇▇▇▇▇▇ and its Related Banks, $100,000,000, and (b) with respect to the Group
consisting of Gotham and its Related Banks, $100,000,000. Any reduction (or
termination) of the Purchase Limit pursuant to the terms of this Agreement shall
reduce ratably (or terminate) each Group's Investor Purchase Limit; provided,
that if any Departing Group shall determine not to extend the Commitment
Termination Date or shall approve an extension of the Commitment Termination
Date based on a reduced Investor Purchase Limit for their Group, then, if the
Investors and Banks in the other Groups shall nonetheless determine to extend
the Commitment Termination Date, effective from such Commitment Termination
Date, the Investor Purchase Limit of the
20
Departing Group shall be so terminated or reduced. Upon such termination or
reduction, the Banks in the other Groups shall have the option of increasing
their Investor Purchase Limit by up to the full amount of such termination or
reduction (the "Investor Purchase Limit Increase Option"). If, within 30 days of
notice from the Departing Group that the Departing Group intends to reduce or
terminate its Investor Purchase Limit, the Banks in the other Groups choose not
to exercise the Investor Purchase Limit Increase Option in full, the Seller
shall be permitted to bring in other financial institutions as Banks and
Investors hereunder under the terms herein for the remaining Investor Purchase
Limit amount.
"Investor Purchase Limit Increase Option" has the meaning specified within
the definition of "Investor Purchase Limit" in this Section 1.01.
"Investor Rate" means for any Fixed Period for any Receivable Interest:
(a) with respect to ▇▇▇▇▇▇, the per annum rate equivalent to the weighted
average of the per annum rates paid or payable by ▇▇▇▇▇▇ from time to time as
interest on or otherwise (by means of interest rate ▇▇▇▇▇▇ or otherwise) in
respect of those promissory notes issued by ▇▇▇▇▇▇ that are allocated, in whole
or in part, by ▇▇▇▇▇▇'▇ Investor Agent (on behalf of ▇▇▇▇▇▇) to fund the
purchase or maintenance of such Receivable Interest during such Fixed Period as
determined by such Investor Agent (on behalf of ▇▇▇▇▇▇) and reported to the
Seller, the Program Agent and, if the Collection Agent is not the Seller, the
Collection Agent, which rates shall reflect and give effect to the commissions
of placement agents and dealers in respect of such promissory notes, to the
extent such commissions are allocated, in whole or in part, to such promissory
notes by such Investor Agent (on behalf of ▇▇▇▇▇▇); provided, however, that if
any component of such rate is a discount rate, in calculating the "Investor
Rate" for such Fixed Period such Investor Agent shall for such component use the
rate resulting from converting such discount rate to an interest bearing
equivalent rate per annum.
(b) with respect to Gotham, the per annum rate equivalent to the weighted
average of the per annum rates paid or payable by Gotham from time to time as
interest or otherwise (by means of interest rate ▇▇▇▇▇▇ or otherwise) in respect
of the commercial paper issued by Gotham to fund or maintain the Receivable
Interest during the related Fixed Period, as determined by Gotham and reported
to the Seller and Investor Agent, which rates shall reflect and give effect to
the commissions of placement agents and dealers in respect of such commercial
paper, to the extent such commissions are allocated, in whole or in part, to
such commercial paper by Gotham; provided, however, that if any component of
such rate is a discount rate, in calculating the Investor Rate with respect to
Gotham, shall for such component use the rate resulting from converting such
discount rate to an interest bearing equivalent rate per annum.
"Level I Downgrade Event" means the Debt Rating of the Originator is rated
lower than BBB- by S&P or lower than Baa3 by ▇▇▇▇▇'▇ (and includes each Level II
Downgrade Event).
"Level II Downgrade Event" means the Debt Rating of the Originator is rated
lower than BB by S&P or lower than Ba2 by ▇▇▇▇▇'▇.
21
"LIBOR" means the London Interbank Offered Rate.
"Liquidation Day" means, for any Receivable Interest, (i) each day during a
Fixed Period for such Receivable Interest on which the conditions set forth in
Section 3.02 are not satisfied, and (ii) each day which occurs on or after the
Termination Date for such Receivable Interest.
"Liquidation Fee" means, for (i) any Fixed Period for which Yield is
computed by reference to the Investor Rate and a reduction of Capital is made
for any reason in any amount on any day other than a Settlement Date or (ii) any
Fixed Period for which Yield is computed by reference to the Eurodollar Rate and
a reduction of Capital is made for any reason on any day other than the last day
of such Fixed Period, the amount, if any, by which (A) the additional Yield
(calculated without taking into account any Liquidation Fee or any shortened
duration of such Fixed Period pursuant to clause (iii) of the definition
thereof) which would have accrued from the date of such repayment to the last
day of such Fixed Period (or, in the case of clause (i) above, the maturity of
the underlying commercial paper tranches) on the reductions of Capital of the
Receivable Interest relating to such Fixed Period had such reductions remained
as Capital, exceeds (B) the income, if any, received by the Investors or the
Banks which hold such Receivable Interest from the investment of the proceeds of
such reductions of Capital.
"Liquidation Period" means the period commencing on the day following the
last day of the Revolving Period and ending on the later of the Facility
Termination Date and the date on which no Capital of or Yield on any Receivable
Interest shall be outstanding and all other amounts owed by the Seller to the
Investors, the Banks, the Investor Agents, the Program Agent and the Collection
Agent shall be paid in full.
"Lock-Box Account" means a post office box administered by a Lock-Box Bank
or an account maintained at a Lock-Box Bank, in each case for the purpose of
receiving Collections.
"Lock-Box Agreement" means an agreement, in substantially the form of Annex
B.
"Lock-Box Bank" means any of the banks holding one or more Lock-Box
Accounts.
"Loss Percentage" means, for any Receivable Interest on any date, the
greatest of (i) three times the Default Ratio as of the most recently ended
calendar month, (ii) four times the Concentration Limit applicable to Group C
Obligors and (iii) 20%.
"Loss-to-Liquidation Ratio" means the ratio (expressed as a percentage)
computed as of the last day of each calendar month by dividing (i) the aggregate
Outstanding Balances (as of the last day of each of the three most recently
ended calendar months (including the calendar month then ending)) of all
Originator Receivables written off by the Originator or the Seller, or which
should have been written off by the Originator or the Seller in accordance with
the Credit and Collection Policy, during each such calendar month by (ii) the
aggregate amount of Collections of Originator Receivables actually received
during such three calendar month period.
22
"Loss Reserve" means, for any Receivable Interest on any date (i) on which
no Level I Downgrade Event shall have occurred and be continuing, an amount
equal to
▇▇ ▇ ▇▇▇▇
where:
LP = the Loss Percentage for such Receivable Interest
on such date.
▇▇▇▇ = the Outstanding Balance of Eligible Receivables
calculated at the close of business of the Collection
Agent on such date; or
(ii) following the occurrence and during the continuation of a Level I
Downgrade Event, an amount equal to
DLP x ▇▇▇▇
where:
DLP = the Downgraded Loss Percentage for
such Receivable Interest on such
date.
▇▇▇▇ = the Outstanding Balance of
Eligible Receivables calculated at
the close of business of the
Collection Agent on such date.
"Monthly Report" means a report in substantially the form of Annex A-1
hereto and containing such additional information as the Program Agent or any
Investor Agent may reasonably request from time to time, furnished by the
Collection Agent to the Program Agent and each Investor Agent pursuant to
Section 6.02(g)(i).
"Multiemployer Plan" means a Multiemployer plan as defined in Section
4001(a)(3) of ERISA.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Net Receivables Pool Balance" means at any time the Outstanding Balance of
Eligible Receivables then in the Receivables Pool reduced by the sum of (i) the
aggregate amount by which the Outstanding Balance of Eligible Receivables of
each Obligor then in the Receivables Pool exceeds the product of (A) the
Concentration Limit for such Obligor multiplied by (B) the Outstanding Balance
of the Eligible Receivables then in the Receivables Pool, (ii) the aggregate
amount of Collections on hand at such time for payment on account of any
Eligible Receivables, the Obligor of which has not been identified, (iii) the
aggregate Outstanding Balance of all Eligible Receivables in respect of which
any credit memo issued by the Originator or the Seller is outstanding at such
time to the extent deemed Collections have not been paid pursuant to Section
2.04(e), and (iv) the aggregate amount by which the Outstanding Balance of
23
Eligible Receivables the Obligor of which is a Government Obligor exceeds three
percent of the Outstanding Balance of Eligible Receivables then in the
Receivables Pool.
"Obligor" means a Person obligated to make payments pursuant to a Contract.
"Obligor Group" means the Group A Obligors, Group B Obligors or the Group C
Obligors.
"Original Agreement" has the meaning specified in the Preliminary
Statements.
"Originator" means Lexmark International, Inc., a Delaware corporation.
"Originator Purchase Agreement" means the Purchase and Contribution
Agreement dated as of the date of this Agreement between the Originator, as
seller, and the Seller, as purchaser, as the same may be amended, modified or
restated from time to time.
"Originator Receivable" means the indebtedness of any Obligor resulting
from the provision or sale of merchandise, insurance or services by the
Originator under a Contract (other than Excluded Receivables), and includes the
right to payment of any interest or finance charges and other obligations of
such Obligor with respect thereto.
"Other Companies" means the Originator and all of its Subsidiaries except
the Seller.
"Outstanding Balance" of any Receivable at any time means the then
outstanding principal balance thereof.
"PBGC" means the Pension Benefit Guaranty Corporation referred to and
defined in ERISA and any successor entity performing similar functions.
"Percentage" of any Bank means, (a) with respect to Citibank, the
percentage set forth on the signature page to this Agreement, or such amount as
reduced or increased by any Assignment and Acceptance entered into with an
Eligible Assignee, (b) with respect to BTM, the percentage set forth on the
signature page to this Agreement, or such amount as reduced or increased by any
Assignment and Acceptance entered into with an Eligible Assignee, or (c) with
respect to a Bank that has entered into an Assignment and Acceptance, the amount
set forth therein as such Bank's Percentage, or such amount as reduced or
increased by an Assignment and Acceptance entered into between such Bank and an
Eligible Assignee.
"Person" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.
"Plan" means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code
or Section 302 of ERISA, and in respect of which the Seller or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 or
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.
24
"Pool Non-compliance Date" means any day on which the Net Receivables Pool
Balance as shown in the most recent Monthly Report (prior to a Level I Downgrade
Event), Weekly Report (following a Level I Downgrade Event but prior to a Level
II Downgrade Event) or Daily Report (following a Level II Downgrade Event) is
less than the Required Net Receivables Pool Balance.
"Pool Receivable" means a Receivable in the Receivables Pool.
"Program Agent" has the meaning specified in the introductory paragraph
hereof.
"Purchase Limit" means $200,000,000, as such amount may be reduced pursuant
to the immediately succeeding sentence or Section 2.01(b). In the event that the
Facility Termination Date shall occur solely under clause (d) of such defined
term, then on such Facility Termination Date the Purchase Limit shall be reduced
by the aggregate Bank Commitments of the Banks in the Group for which such
Facility Termination Date has occurred (as such Bank Commitments were in effect
immediately prior to such Facility Termination Date), except that the Purchase
Limit may be increased by the additional Bank Commitments of Banks in the other
Groups and/or other financial institutions as provided under the definition of
"Bank Commitment." References to the unused portion of the Purchase Limit shall
mean, at any time, the Purchase Limit, as then reduced pursuant to Section
2.01(b), minus the then outstanding Capital of Receivable Interests under this
Agreement.
"Purchaser Collections" means, as of any Deposit Date, that portion of the
Collections deposited to the Lock-Box Accounts on such date or received by the
Collection Agent on such date equal to the product of (i) the Allocation
Percentage on such date times (ii) the aggregate amount of such Collections.
"Receivable" means any Originator Receivable which has been acquired by the
Seller from the Originator by purchase or by capital contribution pursuant to
the Originator Purchase Agreement.
"Receivable Interest" means, at any time, an undivided percentage ownership
interest in (i) all then outstanding Pool Receivables arising prior to the time
of the most recent computation or recomputation of such undivided percentage
interest pursuant to Section 2.03, (ii) all Related Security with respect to
such Pool Receivables, and (iii) all Collections with respect to, and other
proceeds of, such Pool Receivables. Such undivided percentage interest shall be
computed as
C + YFR + LR + DR
-----------------
NRPB
where:
C = the Capital of such Receivable Interest at the time of computation.
YFR = the Yield and Fee Reserve of such Receivable Interest at the time
of computation.
25
LR = the Loss Reserve of such Receivable Interest at the time of
computation.
DR = the Dilution Reserve of such Receivable Interest at the time of
computation.
NRPB = the Net Receivables Pool Balance at the time of computation.
Each Receivable Interest shall be determined from time to time pursuant to the
provisions of Section 2.03.
"Receivables Pool" means at any time the aggregation of each then
outstanding Receivable in respect of which the Obligor is a Designated Obligor
at such time or was a Designated Obligor on the date of the initial creation of
an interest in such Receivable under this Agreement.
"Related Bank" means (a) with respect to ▇▇▇▇▇▇, Citibank, each Bank which
has entered into an Assignment and Acceptance with Citibank, and each assignee
(directly or indirectly) of any such Bank, which assignee has entered into an
Assignment and Acceptance, and (b) with respect to Gotham, BTM, each Bank which
has entered into an Assignment and Acceptance with BTM, and each assignee
(directly or indirectly) of any such Bank, which assignee has entered into an
Assignment and Acceptance.
"Related Security" means with respect to any Receivable
(i) all of the Seller's interest in any merchandise (including returned
merchandise) relating to any sale giving rise to such Receivable;
(ii) all security interests or liens and property subject thereto from time
to time purporting to secure payment of such Receivable, whether pursuant to the
Contract related to such Receivable or otherwise, together with all financing
statements filed against an Obligor describing any collateral securing such
Receivable;
(iii) all guaranties, insurance and other agreements or arrangements of
whatever character from time to time supporting or securing payment of such
Receivable whether pursuant to the Contract related to such Receivable or
otherwise; and
(iv) the Contract and all other books, records and other information
(including, without limitation, computer programs, tapes, discs, punch cards,
data processing software and related property and rights) relating to such
Receivable and the related Obligor.
"Required Net Receivables Pool Balance" means, as of any day, the sum of
(i) the aggregate Reserves for all Receivable Interests calculated as of such
day, plus (ii) the aggregate outstanding Capital for all Receivable Interests as
of such day. For purposes of such calculation, Capital shall be reduced by the
aggregate amount of funds then held in the Cash Collateral Account, and (to the
extent applicable) the Reserves shall be computed on such reduced Capital.
26
"Reserves" means, with respect to any Receivable Interest as of any day,
the sum of the Yield and Fee Reserve, the Loss Reserve and the Dilution Reserve
for such Receivable Interest as of such day.
"Responsible Financial Officer" means, for any Person, its chief financial
officer, controller, treasurer or assistant treasurer.
"Revolving Period" means the period beginning on the date of the initial
purchase hereunder and terminating at the close of business on the Business Day
immediately preceding the date on which the Termination Date shall have occurred
for all Receivable Interests.
"S&P" means Standard and Poors, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.
"SEC" means the Securities and Exchange Commission.
"Seller" has the meaning specified in the introductory paragraph hereof.
"Seller Collections" means, with respect to any Deposit Date, that portion
of the Collections deposited to the Lock-Box Accounts on such date or received
by the Collection Agent on such date equal to the product of (i) 100% minus the
Allocation Percentage on such date times (ii) the aggregate amount of such
Collections.
"Seller Report" means a Monthly Report, a Weekly Report or a Daily Report.
"Settlement Date" for any Receivable Interest means the last day of each
Fixed Period for such Receivable Interest; provided, however, that if Yield with
respect to such Receivable Interest is computed by reference to the Investor
Rate and no Liquidation Day exists on the last day of a Fixed Period for such
Receivable Interest, the Settlement Date for such Receivable Interest for such
Fixed Period shall be the second Business Day after the last day of such Fixed
Period.
"Subsidiary" means any corporation or other entity of which securities
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by the Seller or the Originator, as the case may be, or one or
more Subsidiaries, or by the Seller or the Originator, as the case may be, and
one or more Subsidiaries.
"Tangible Net Worth" means at any time the excess of (i) the sum of (a) the
product of (x) 100% minus the Discount (as such term is defined in the
Originator Purchase Agreement) multiplied by (y) the Outstanding Balance of all
Receivables other than Defaulted Receivables plus (b) cash and cash equivalents
of the Seller plus (c) the outstanding principal amount of Purchaser Loans (as
such term is defined in the Originator Purchase Agreement), minus (ii) the sum
of (a) Capital plus (b) the Deferred Purchase Price.
"Taxes" has the meaning specified in Section 2.10.
27
"Termination Date" for any Receivable Interest means (i) in the case of a
Receivable Interest owned by an Investor, the earlier of (a) the Business Day
which the Seller or the Investor Agent for such Investor so designates by notice
to the other (with a copy to the Program Agent and the other Investor Agents) at
least one Business Day in advance for such Receivable Interest and (b) the
Facility Termination Date and (ii) in the case of a Receivable Interest owned by
a Bank, the earlier of (a) the Business Day which the Seller so designates by
notice to the Program Agent and the Investor Agents at least one Business Day in
advance for such Receivable Interest and (b) the Commitment Termination Date.
"Transaction Document" means any of this Agreement, the Originator Purchase
Agreement, the Lock-Box Agreement, the Cash Collateral Agreement, the Fee
Agreements and all amendments to any of the foregoing and all other agreements
and documents delivered and/or related hereto or thereto.
"UCC" means the Uniform Commercial Code as from time to time in effect in
the specified jurisdiction.
"Week" means each calendar week beginning on Monday and ending on (and
including) the following Sunday.
"Weekly Report" means a report in substantially the form of Annex A-2
hereto and containing such additional information as the Program Agent or any
Investor Agent may reasonably request from time to time, furnished by the
Collection Agent to the Program Agent and each Investor Agent pursuant to
Section 6.02(g)(ii) following the occurrence of a Level I Downgrade Event.
"Withdrawal Liability" means liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.
"Yield" means:
(i) for each Receivable Interest for any Fixed Period to the extent an
Investor will be funding its portion of such Receivable Interest through the
issuance of commercial paper or other promissory notes,
IR x C x ED + LF
--
360
(ii) for each Receivable Interest for any Fixed Period to the extent (x) an
Investor will not be funding its portion of such Receivable Interest through the
issuance of commercial paper or other promissory notes, or (y) a Bank will be
funding its portion of such Receivable Interest,
AR x C x ED + LF
--
360
where:
28
AR = the Assignee Rate for such portion of such Receivable Interest for
such Fixed Period
C = the Capital of such portion of such Receivable Interest during such
Fixed Period
IR = the Investor Rate for such portion of such Receivable Interest for
such Fixed Period
ED = the actual number of days elapsed during such Fixed Period
LF = the Liquidation Fee, if any, for such portion of such Receivable
Interest for such Fixed Period
provided that no provision of this Agreement shall require the payment or permit
the collection of Yield in excess of the maximum permitted by applicable law;
and provided further that Yield for any Receivable Interest shall not be
considered paid by any distribution to the extent that at any time all or a
portion of such distribution is rescinded or must otherwise be returned for any
reason.
"Yield and Fee Reserve" means, for any Receivable Interest on any date, an
amount equal to
(C x YFRP) + AUYF
where:
C = the Capital of such Receivable
Interest at the close of business of
the Collection Agent on such date.
YFRP = the Yield and Fee Reserve Percentage on such date.
AUYF = accrued and unpaid Yield,
Collection Agent Fee and Fees on
such date, in each case for such
Receivable Interest.
"Yield and Fee Reserve Percentage" means, on any date, a
percentage equal to
[(AER x 1.1) + AM + PF + CAF] x DSO
-----------------------------------
360
where:
AER = the one-month Adjusted Eurodollar Rate in effect on
such date.
AM = the applicable spread or margin
over the Eurodollar Rate used in the
calculation of the Assignee Rate in
effect on such date.
29
PF = the Program Fee (as defined in the
Fee Agreement), in effect on such
date.
CAF = the percentage per annum used in
the calculation of the Collection
Agent Fee in effect on such date.
DSO = the Days Sales Outstanding on such date.
SECTION 1.02. Other Terms. (a) All accounting terms not specifically
defined herein shall be construed in accordance with GAAP.
(b) 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) A reference to an "Article," "Section" or "Subsection" without further
reference to a specific article or section number is a reference to the same
Article, Section or Subsection in which the reference appears, and this rule
shall also apply to paragraphs and other subdivisions.
(d) A reference to a Subsection without further reference to a Section is a
reference to such Subsection as contained in the same Section in which the
reference appears, and this rule shall also apply to paragraphs and other
subdivisions.
(e) The words "herein," "hereof," "hereunder" and other words of similar
import refer to this Agreement as a whole and not to any particular provision.
(f) The term "include" or "including" shall mean without limitation by
reason of enumeration.
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01. Purchase Facility. (a) On the terms and conditions
hereinafter set forth, each of ▇▇▇▇▇▇ and Gotham may, in its sole discretion,
ratably in accordance with the Investor Purchase Limit of its Group, and, if and
to the extent ▇▇▇▇▇▇ or Gotham does not make a purchase, the Related Banks for
such Investor shall, ratably in accordance with their respective Bank
Commitments, purchase Receivable Interests from the Seller from time to time
during the period from the date hereof to the Facility Termination Date (in the
case of the Investors) and to the Commitment Termination Date (in the case of
the Banks). Under no circumstances shall the Investors make any such purchase,
or the Banks be obligated to make any such purchase, if after giving effect to
such purchase the aggregate outstanding Capital of Receivable Interests would
exceed the Purchase Limit.
(b) The Seller may at any time after December 31, 2004, upon at least five
Business Days' notice to the Program Agent and the Investor Agents, terminate
the facility provided for in this Agreement in whole or, from time to time,
reduce in part the unused portion
30
of the Purchase Limit; provided that each partial reduction shall be in the
amount of at least $1,000,000 or an integral multiple thereof.
(c) Until the Program Agent (or any Investor Agent with respect to its
Investor) gives the Seller the notice provided in Section 3.02(c)(iii), the
Program Agent, on behalf of the Investors which own Receivable Interests, may
have the Collections attributable to such Receivable Interests automatically
reinvested pursuant to Section 2.04 in additional undivided percentage interests
in the Pool Receivables by making an appropriate readjustment of such Receivable
Interests. The Program Agent, on behalf of the Banks which own Receivable
Interests, shall have the Collections attributable to such Receivable Interests
automatically reinvested pursuant to Section 2.04 in additional undivided
percentage interests in the Pool Receivables by making an appropriate
readjustment of such Receivable Interests.
SECTION 2.02. Making Purchases. (a) Each purchase by any of the Investors
or the Banks shall be made on at least one Business Day's notice from the Seller
to the Program Agent and each Investor Agent. Each such notice of a purchase
shall specify (i) the amount requested to be paid to the Seller (such amount,
which shall not be less than $1,000,000, being referred to herein as the initial
"Capital" of the Receivable Interest then being purchased), (ii) the allocation
of such amount among each of the Groups (which shall be proportional to the
Investor Purchase Limit of each Group), (iii) the date of such purchase (which
shall be a Business Day), and (iv) if the Assignee Rate based on the Eurodollar
Rate is to apply to such Receivable Interest, the duration of the initial Fixed
Period for such Receivable Interest. Each Investor Agent shall promptly notify
the Program Agent whether such Investor has determined to make the requested
purchase on the terms specified by the Seller.
The Program Agent shall promptly thereafter notify the Seller whether the
Investors have determined to make the requested purchase and, if so, whether all
of the terms specified by the Seller are acceptable to the Investors.
If any Investor has determined not to make the entire amount of a proposed
purchase requested to be made by it, the Investor Agent for such Investor shall
promptly send notice of the proposed purchase to all of the Related Banks for
such Investor concurrently by telecopier, telex or cable specifying the date of
such purchase, the aggregate amount of Capital of Receivable Interest being
purchased by such Related Banks (which amount shall be equal to the portion of
the initial Capital requested to be funded by such Investor, which such Investor
determined not to fund), each such Related Bank's portion thereof (determined
ratably in accordance with its respective Bank Commitment), whether the Yield
for the Fixed Period for such Receivable Interest is calculated based on the
Eurodollar Rate (which may be selected only if such notice is given at least
three Business Days prior to the purchase date) or the Alternate Base Rate, and
the duration of the Fixed Period for such Receivable Interest (which shall be
one day if the Seller has not selected another period).
(b) On the date of each such purchase of a Receivable Interest, the
applicable Investors and/or Banks, as the case may be, shall, upon satisfaction
of the applicable conditions set forth in this Article II and Article III, make
available to the Seller in same day funds at the account set forth in the Funds
Transfer Letter, an aggregate amount equal to the initial Capital of such
Receivable Interest; provided, however, if such purchase is being made by the
applicable
31
Banks following the designation by the Investor Agent for an Investor of a
Termination Date for a Receivable Interest owned by such Investor pursuant to
clause (i)(a) of the definition of Termination Date and any Capital of such
Receivable Interest is outstanding on such date of purchase, the Seller hereby
directs the applicable Banks to pay the proceeds of such purchase (to the extent
of the outstanding Capital and accrued Yield on such Receivable Interest of such
Investor) to the relevant Investor Agent's Account, for application to the
reduction of the outstanding Capital and accrued Yield on such Receivable
Interest of such Investor.
(c) Effective on the date of each purchase pursuant to this Section 2.02
and each reinvestment pursuant to Section 2.04, the Seller hereby sells and
assigns to the Program Agent, for the benefit of the parties making such
purchase, an undivided percentage ownership interest, to the extent of the
Receivable Interest then being purchased, in each Pool Receivable then existing
and in the Related Security and Collections with respect thereto.
(d) Notwithstanding the foregoing, (i) neither ▇▇▇▇▇▇ nor Gotham shall make
purchases under this Section 2.02 at any time in an amount which would exceed
the Investor Purchase Limit of such Investor's Group and (ii) a Bank shall not
be obligated to make purchases under this Section 2.02 at any time in an amount
which would exceed such Bank's Bank Commitment less the sum of (A) the aggregate
outstanding and unpaid amount of any purchases made by such Bank under such
Bank's Asset Purchase Agreement plus (B) such Bank's ratable share of the
aggregate outstanding portion of Capital held by the Investor in such Bank's
Group (whether or not any portion thereof has been assigned under an Asset
Purchase Agreement), after giving effect to reductions of the Capital held by
the Investor in such Bank's Group to be made on the date of such purchase
(whether from the distribution of Collections or from the proceeds of purchases
by such Bank). Each Bank's obligation shall be several, such that the failure of
any Bank to make available to the Seller any funds in connection with any
purchase shall not relieve any other Bank of its obligation, if any, hereunder
to make funds available on the date of such purchase, but no Bank shall be
responsible for the failure of any other Bank to make funds available in
connection with any purchase.
SECTION 2.03. Receivable Interest Computation. Each Receivable Interest
shall be initially computed on its date of purchase. Thereafter until the
Termination Date for such Receivable Interest, such Receivable Interest shall be
automatically recomputed (or deemed to be recomputed) on each day other than a
Liquidation Day. Any Receivable Interest, as computed (or deemed recomputed) as
of the day immediately preceding the Termination Date for such Receivable
Interest, shall thereafter remain constant; provided, however, that from and
after the date on which the Termination Date shall have occurred for all
Receivable Interests and until each Receivable Interest becomes zero in
accordance with the next sentence, each Receivable Interest shall be calculated
as the percentage equivalent of a fraction the numerator of which is the
percentage representing such Receivable Interest immediately prior to such date
and the denominator of which is the sum of the percentages representing all
Receivable Interests which were outstanding immediately prior to such date. Each
Receivable Interest shall become zero when Capital thereof and Yield thereon
shall have been paid in full, and all Fees and other amounts owed by the Seller
hereunder to the Investors, the Banks, the Investor Agents or the Program Agent
are paid and the Collection Agent shall have received the accrued Collection
Agent Fee thereon.
32
SECTION 2.04. Settlement Procedures. (a) Collection of the Pool Receivables
shall be administered by a Collection Agent, in accordance with the terms of
Article VI of this Agreement. The Seller shall provide to the Collection Agent
(if other than the Seller) on a timely basis all information needed for such
administration, including notice of the occurrence of any Liquidation Day and
current computations of each Receivable Interest.
(b) So long as no Level II Downgrade Event shall have occurred, the
Collection Agent shall, on each Deposit Date, with respect to Collections
deposited in any of the Lock-Box Accounts on such Deposit Date or received by
the Collection Agent on such Deposit Date (in the following order and priority):
(i) with respect to each Receivable Interest, set aside and hold in trust
(and, at the request of the Program Agent following the occurrence and during
the continuation of a Collection Agent Default, segregate) for the Investors or
the Banks that hold such Receivable Interest and for the Investor Agents, out of
the percentage of such Collections represented by such Receivable Interest, an
amount equal to the Yield, Fees and Collection Agent Fee accrued through such
day for such Receivable Interest and not previously set aside;
(ii) with respect to each Receivable Interest, if such day is not a
Liquidation Day for such Receivable Interest, reinvest with the Seller on behalf
of the Investors or the Banks that hold such Receivable Interest the percentage
of such Collections represented by such Receivable Interest, to the extent
representing a return of Capital, by recomputation of such Receivable Interest
pursuant to Section 2.03;
(iii) if such day is a Liquidation Day for any one or more Receivable
Interests, set aside and hold in trust (and, at the request of the Program
Agent, segregate) for the Investors and/or the Banks that hold such Receivable
Interests and for the Investor Agents (x) if such day is a Liquidation Day for
less than all of the Receivable Interests, the percentage of such Collections
represented by such Receivable Interests, and (y) if such day is a Liquidation
Day for all of the Receivable Interests, all of the remaining Collections (but
not in excess of the Capital of such Receivable Interests); provided that if
amounts are set aside and held in trust on any Liquidation Day occurring prior
to the Termination Date, and thereafter prior to the Settlement Date for such
Fixed Period the conditions set forth in Section 3.02 are satisfied or waived by
the Program Agent and the Investor Agents, such previously set aside amounts
shall, to the extent representing a return of Capital, be reinvested in
accordance with the preceding subsection (ii) on the day of such subsequent
satisfaction or waiver of conditions; and
(iv) during such times as amounts are required to be reinvested in
accordance with the foregoing subsection (ii) or the proviso to subsection
(iii), release to the Seller for its own account any Collections in excess both
of such amounts and of the amounts that are required to be set aside pursuant to
subsection (i) above.
(c) If a Level II Downgrade Event shall have occurred and be continuing,
the Collection Agent shall comply with the following:
(I) On each Deposit Date during the Revolving Period, the Collection
Agent shall, by no later than 3:00 P.M. (New York City time), deliver to the
Program Agent and
33
the Investor Agents the Daily Report for such date. If the Collection Agent
shall fail to deliver the Daily Report on any Deposit Date during the Revolving
Period, the Collection Agent shall not be permitted to withdraw any amounts from
the Lock-Box Accounts on any date thereafter unless and until the Collection
Agent shall be in compliance with this subsection (I) (but subject to the right
of the Agent to prohibit withdrawals by the Collection Agent from the Lock-Box
Accounts to the extent provided in Section 6.03).
(II) On the first Business Day following each Deposit Date during
the Revolving Period, if the Daily Report for such date shows that no Cure
Period shall have occurred and be continuing, the Collection Agent shall, in the
following order:
(i) based on the Allocation Percentage on such day, determine the
amount of Purchaser Collections and Seller Collections;
(ii) withdraw from the Lock-Box Accounts and from Collections of
Pool Receivables which the Collection Agent received on such Deposit
Date and set aside and hold in trust (and, at the request of the
Program Agent, segregate) for the Investors and Banks that hold
Receivable Interests, out of Purchaser Collections, an amount equal to
the Yield, Fees and Collection Agent Fee accrued through such day for
the Receivable Interests and not previously withdrawn and set aside;
(iii) withdraw from the Lock-Box Accounts and from Collections of
Pool Receivables which the Collection Agent received on such Deposit
Date and release to the Seller the remainder of Purchaser Collections,
in each instance to the extent representing a return of Capital, to be
reinvested with the Seller in Receivable Interests; provided that, if
immediately following any such reinvestment such Deposit Date would be
a Pool Non-compliance Date, the Collection Agent shall retain all such
remaining Collections in (or, to the extent the Collection Agent has
received any such Collections, redeposit such Collections into) the
Lock-Box Accounts (and deposit the other such remaining Collections
received by it into the Lock-Box Accounts) to be applied pursuant to
Section 2.04(c)(III)(iii); and
(iv) remit the Seller Collections to the Seller.
(III) On the first Business Day following each Deposit Date during the
Revolving Period, if the Daily Report for such date shows that a Cure Period
shall have occurred and be continuing, the Collection Agent shall, in the
following order:
(i) based on the Allocation Percentage on such day, determine the
amount of Purchaser Collections and Seller Collections;
(ii) withdraw from the Lock-Box Accounts and from Collections of
Pool Receivables which the Collection Agent received on such Deposit
Date and set aside and hold in trust (and, at the request of the
Program Agent, segregate) for the Investors and Banks that hold
Receivable Interests, out of Purchaser Collections, an amount equal to
the Yield, Fees and Collection Agent Fee accrued through such day for
the Receivable Interests and not previously withdrawn and set aside;
34
(iii) remit to the Cash Collateral Account from the Lock-Box
Accounts and from Collections of Pool Receivables which the Collection
Agent received on such Deposit Date an amount equal to the lesser of
(x) the sum of the remaining Collections in the Lock-Box Accounts (and
Collections received by the Collection Agent from the Lock-Box
Accounts on such Deposit Date) and the remaining Collections of Pool
Receivables received by it on such Deposit Date and (y) an amount
equal to the excess of the Required Net Receivables Pool Balance over
the Net Receivables Pool Balance;
(iv) withdraw from the Lock-Box Accounts and from Collections of
Pool Receivables which the Collection Agent received on such Deposit
Date and release to the Seller the remainder of Purchaser Collections,
in each instance to the extent representing a return of Capital, to be
reinvested with the Seller in Receivable Interests (for purposes of
determining the remainder of Purchaser Collections, any Collections
which have previously been applied pursuant to Section
2.04(c)(III)(iii) shall be deemed to be first Seller Collections and
then Purchaser Collections); and
(v) remit the Seller Collections to the Seller.
(IV) On the first Business Day following each Deposit Date during
the Liquidation Period, the Collection Agent shall, by no later than
3:00P.M. (New York City time), remit to each Investor Agent's Account
for each Investor Agent all Collections held for such Investor Agent,
the Investors and/or the Banks in its Group in the Lock-Box Accounts
and such Investor Agent's pro-rata portion of all Collections of Pool
Receivables which the Collection Agent received on such Deposit Date.
(d) The Collection Agent shall deposit into the Investor Agent's Account
for each Investor Agent (i) on the fourth Business day of each calendar month,
Collections held for such Investor Agent, the Investors and/or the Banks in its
Group during the prior calendar month pursuant to Sections 2.04(b)(i),
2.04(c)(II)(ii) and 2.04(c)(III)(ii), (excluding, however, so long as the
Originator is the Collection Agent, the Collection Agent Fee) and (ii) on the
Settlement Date for each Receivable Interest, Collections held for such Investor
Agent, the Investors and/or the Banks in its Group that relate to such
Receivable Interest pursuant to Section 2.04(b) or (c) (other than as set forth
in clause (i)). After the occurrence and during the continuation of Level I
Downgrade Event which is not a Level II Downgrade Event, on the Business Day
immediately following the delivery of any Weekly Report which sets forth a Pool
Non-Compliance Date as of the close of business on the last Business Day of the
preceding Week, and on each Business Day thereafter until a Pool Non-Compliance
Date no longer exists, the Collection Agent shall deposit into the Investor
Agent's Account for each Investor Agent Collections set aside for such Investor
Agent, the Investors and/or Banks in its Group pursuant to clause (iii) of
Section 2.04(b), provided that the aggregate amount deposited pursuant to this
sentence with respect to any Weekly Report shall not exceed an amount such that,
after giving effect to the application of such amount to the reduction of
Capital, the sum of the Receivable Interests is equal to 100%. The Collection
Agent shall pay to itself on each Settlement Date which is not a Liquidation Day
Collections set aside with respect to each Receivable Interest on account of
accrued Collection Agent Fee. On any Business Day on which funds are on deposit
in the Cash Collateral Account, the Collection Agent (i) shall, upon written
notice from the Program Agent or any of the Investor Agents, and may (if the
funds in the Cash Collateral Account exceed $10,000,000), upon written
35
notice to the Program Agent and the Investor Agents, remit such funds from the
Cash Collateral Account to the Investor Agent's Account for each Investor Agent,
such remittance to be applied as a reduction of Capital, or (ii) may, following
delivery of the Weekly Report or Daily Report to the Program Agent, as the case
may be, withdraw from the Cash Collateral Account and remit to the Seller all or
a portion of the funds in the Cash Collateral Account; provided that such Weekly
Report or Daily Report, as the case may be, shall state that, after taking
account of the proposed withdrawal, the Net Receivables Pool Balance on such day
will be equal to or greater than the Required Net Receivables Pool Balance, and
such Weekly Report or such Daily Report, as the case may be, shall set forth the
calculation supporting such statement.
(e) Upon receipt of funds deposited into the Investor Agent's Account, the
relevant Investor Agent shall distribute them as follows:
(i) if such distribution occurs on a day that is not a Liquidation Day,
first to the Investors or the Banks in its Group that hold the relevant
Receivable Interest and to such Investor Agent in payment in full of all accrued
Yield and Fees and then to the Collection Agent in payment in full of all
accrued Collection Agent Fee payable by the Investors and Banks in its Group;
provided, that if such distribution related to Collections remitted from the
Cash Collateral Account, such distribution shall be paid to the Investors and
the Banks in its Group that hold the Receivable Interest in respect thereof, in
reduction of Capital.
(ii) if such distribution occurs on a Liquidation Day, first to the
Investors or the Banks in its Group that hold the relevant Receivable Interest
and to such Investor Agent in payment in full of all accrued Yield and Fees,
second to such Investors and/or Banks in reduction to zero of all Capital, third
to such Investors, Banks or such Investor Agent in payment of any other amounts
owed by the Seller hereunder, and fourth to the Collection Agent in payment in
full of all accrued Collection Agent Fee payable by the Investors and Banks in
its Group.
After the Capital, Yield, Fees and Collection Agent Fee with respect to a
Receivable Interest, and any other amounts payable by the Seller to the
Investors, the Banks, the Investor Agents or the Program Agent hereunder, have
been paid in full, all additional Collections with respect to such Receivable
Interest shall be paid to the Seller for its own account.
(f) For the purposes of this Section 2.04:
(i) if on any day the Outstanding Balance of any Pool Receivable is reduced
or adjusted as a result of any defective, rejected or returned merchandise or
services, or any cash discount, discount for quick payment or other adjustment
made by the Seller or the Originator, or any setoff, the Seller shall be deemed
to have received on such day a Collection of such Pool Receivable in the amount
of such reduction or adjustment;
(ii) if on any day upon each purchase or reinvestment (A) any of the
representations or warranties contained in Section 4.01(h) is no longer true
with respect to any Pool Receivable or (B) the Investors or the Banks, as the
case may be, shall not acquire a valid and perfected first priority undivided
percentage ownership interest to the extent of the pertinent Receivable Interest
in each Pool Receivable then existing or thereafter arising and in the Related
36
Security and Collections with respect thereto, then the Seller shall be deemed
to have received on such day a Collection of such Pool Receivable in full;
(iii) except as provided in subsection (i) or (ii) of this Section 2.04(f),
or as otherwise required by applicable law or the relevant Contract, all
Collections received from an Obligor of any Receivables shall be applied to the
Receivables of such Obligor in the order of the age of such Receivables,
starting with the oldest such Receivable, unless such Obligor designates its
payment for application to specific Receivables; and
(iv) if and to the extent the Program Agent, any of the Investor Agents,
the Investors or the Banks shall be required for any reason to pay over to an
Obligor any amount received on its behalf hereunder, such amount shall be deemed
not to have been so received but rather to have been retained by the Seller and,
accordingly, the Program Agent, such Investor Agent, the Investors or the Banks,
as the case may be, shall have a claim against the Seller for such amount,
payable when and to the extent that any distribution from or on behalf of such
Obligor is made in respect thereof.
(g) In the event that the Program Agent or any Investor Agent receives
Collections in respect of any Receivable directly from an Obligor, such Agent
shall, at its option, either (i) promptly forward such Collections to the
Collection Agent (and the Collection Agent shall apply such Collections in
accordance with this Section 2.04) or (ii) promptly apply such Collections in
accordance with this Section 2.04 in the same manner that Collection Agent would
apply such Collections.
SECTION 2.05. Fees. (a) Each Investor and Bank shall pay to the Collection
Agent a fee (the "Collection Agent Fee") of l/2 of 1% per annum on the average
daily Capital of each Receivable Interest owned by such Investor or Bank, from
the date of purchase of such Receivable Interest until the later of the
Termination Date for such Receivable Interest or the date on which such Capital
is reduced to zero, payable on the Settlement Date for such Receivable Interest.
Upon three Business Days' notice to the Program Agent and each Investor Agent,
the Collection Agent (if not the Originator, the Seller or its designee or an
Affiliate of the Seller) may elect to be paid, as such fee, another percentage
per annum on the average daily Capital of such Receivable Interest, but in no
event in excess for all Receivable Interests relating to the Receivables Pool of
110% of the reasonable costs and expenses of the Collection Agent in
administering and collecting the Receivables in the Receivables Pool. The
Collection Agent Fee shall be payable only from Collections pursuant to, and
subject to the priority of payment set forth in, Section 2.04. So long as the
Originator is acting as the Collection Agent hereunder, amounts paid as the
Collection Agent Fee pursuant to this Section 2.05(a) shall reduce, on a
dollar-for-dollar basis, the obligation of the Seller to pay the "Collection
Agent Fee" pursuant to Section 6.03 of the Originator Purchase Agreement,
provided that such obligation of the Seller shall in no event be reduced below
zero.
(b) The Seller shall pay to the Investor Agents certain fees (collectively,
the "Fees") in the amounts and on the dates set forth in separate fee agreements
of even date among the Seller, the Program Agent and each Investor Agent,
respectively, as the same may be amended or restated from time to time (the "Fee
Agreements").
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SECTION 2.06. Payments and Computations, Etc. (a) All amounts to be paid or
deposited by the Seller or the Collection Agent hereunder shall be paid or
deposited no later than 12:00 noon (New York City time) on the day when due in
same day funds to the applicable Investor Agent's Account, provided, that all
amounts to be deposited into the Cash Collateral Account shall be deposited no
later than 12:00 noon (New York City time) on the date when due, and in any
event such amounts shall be deposited into the Cash Collateral Account prior to
any withdrawal from a Lock-Box Account (other than to directly fund a deposit
into the Cash Collateral Account).
(b) Each of the Seller and the Collection Agent shall, to the
extent permitted by law, pay interest on any amount not paid or deposited by it
when due hereunder, at an interest rate per annum equal to 2.00% per annum above
the Alternate Base Rate, payable on demand.
(c) All computations of interest under subsection (b) above and all
computations of Yield, Fees, and other amounts hereunder shall be made on the
basis of a year of 360 days for the actual number of days (including the first
but excluding the last day) elapsed. Whenever any payment or deposit to be made
hereunder shall be due on a day other than a Business Day, such payment or
deposit shall be made on the next succeeding Business Day and such extension of
time shall be included in the computation of such payment or deposit.
SECTION 2.07. Dividing or Combining Receivable Interests. Either the Seller
or any Investor Agent may, upon notice to the other party (with a copy of such
notice to the Program Agent) received at least three Business Days prior to the
last day of any Fixed Period in the case of the Seller giving notice, or up to
the last day of such Fixed Period in the case of an Investor Agent giving
notice, either (i) divide any portion of a Receivable Interest held by one or
more Investors and/or Banks in its Group into two or more Receivable Interests
of such Investors and/or Banks having aggregate Capital equal to the Capital of
such divided portion of such Receivable Interest, or (ii) combine any two or
more portions of Receivable Interests held by one or more Investors and/or Banks
in its Group originating on such last day or having Fixed Periods ending on such
last day into a single Receivable Interest having Capital equal to the aggregate
of the Capital of such Receivable Interests; provided, however, that no
Receivable Interest owned by ▇▇▇▇▇▇ may be combined with a Receivable Interest
owned by any Bank.
SECTION 2.08. Increased Costs. (a) If CNAI, any Investor, any Investor
Agent, any Bank, any entity (including any bank or other financial institution
providing liquidity and/or credit support to any Investor in connection with
such Investor's commercial paper program) which purchases or which enters into a
commitment to purchase Receivable Interests or interests therein, or any of
their respective Affiliates (each an "Affected Person") determines that
compliance with any law or regulation or any guideline or request from any
central bank or other governmental authority (whether or not having the force of
law) affects or would affect the amount of the capital required or expected to
be maintained by such Affected Person and such Affected Person determines that
the amount of such capital is increased by or based upon the existence of any
commitment to make purchases of or otherwise to maintain the investment in Pool
Receivables or interests therein related to this Agreement or to the funding
thereof and other commitments of the same type, then, upon demand by such
Affected Person (with a copy to the Program Agent and the Investor Agent for
such Affected Person's Group), the Seller shall
38
immediately pay to the Investor Agent for such Affected Person's Group for the
account of such Affected Person (as a third-party beneficiary), from time to
time as specified by such Affected Person, additional amounts sufficient to
compensate such Affected Person in the light of such circumstances, to the
extent that such Affected Person reasonably determines such increase in capital
to be allocable to the existence of any of such commitments. A certificate as to
such amounts submitted to the Seller and the Program Agent and the Investor
Agent for such Affected Person's Group by such Affected Person shall be
conclusive and binding for all purposes, absent manifest error.
(b) If, due to either (i) the introduction of or any change (other than any
change by way of imposition or increase of reserve requirements referred to in
Section 2.09) in or in the interpretation of any law or regulation or (ii)
compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall be
any increase in the cost to any Investor or Bank of agreeing to purchase or
purchasing, or maintaining the ownership of Receivable Interests in respect of
which Yield is computed by reference to the Eurodollar Rate, then, upon demand
by such Investor or Bank (with a copy to the Program Agent and the Investor
Agent for such Investor or such Bank), the Seller shall immediately pay to such
Investor Agent, for the account of such Investor or Bank (as a third-party
beneficiary), from time to time as specified by such Investor or Bank,
additional amounts sufficient to compensate such Investor or Bank for such
increased costs. A certificate as to such amounts submitted to the Seller and
the Program Agent and the Investor Agent for such Affected Person's Group by
such Investor or Bank shall be conclusive and binding for all purposes, absent
manifest error.
SECTION 2.09. Additional Yield on Receivable Interests Bearing a Eurodollar
Rate. The Seller shall pay to any Investor or Bank, so long as such Investor or
Bank shall be required under regulations of the Board of Governors of the
Federal Reserve System to maintain reserves with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities, additional Yield on
the unpaid Capital of each Receivable Interest of such Investor or Bank during
each Fixed Period relating to any portion of the Capital of such Investor or
Bank in respect of which Yield is computed by reference to the Eurodollar Rate,
for such Fixed Period, at a rate per annum equal at all times during such Fixed
Period to the remainder obtained by subtracting (i) the Eurodollar Rate for such
Fixed Period from (ii) the rate obtained by dividing such Eurodollar Rate
referred to in clause (i) above by that percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage of such Investor or Bank for such Fixed
Period, payable on each date on which Yield is payable on such Receivable
Interest. Such additional Yield shall be determined by such Investor or Bank and
notice thereof given to the Seller through the Investor Agent for such Investor
or Bank (with a copy to the Program Agent) within 30 days after any Yield
payment is made with respect to which such additional Yield is requested. A
certificate as to such additional Yield submitted to the Seller and the Program
Agent by such Investor or Bank shall be conclusive and binding for all purposes,
absent manifest error.
SECTION 2.10. Taxes. (a) Any and all payments and deposits required to be
made hereunder or under any other Transaction Document by the Collection Agent
or the Seller shall be made free and clear of and without deduction for any and
all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding net income
taxes that are imposed by the United States and franchise
39
taxes and net income taxes that are imposed on an Affected Person by the state
or foreign jurisdiction under the laws of which such Affected Person is
organized or any political subdivision thereof (all such non-excluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Taxes"). If the Seller or the Collection Agent shall
be required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Affected Person, (i) the Seller shall make an additional
payment to such Affected Person, in an amount sufficient so that, after making
all required deductions (including deductions applicable to additional sums
payable under this Section 2.10), such Affected Person receives an amount equal
to the sum it would have received had no such deductions been made, (ii) the
Seller or the Collection Agent, as the case may be, shall make such deductions
and (iii) the Seller or the Collection Agent, as the case may be, shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable law.
(b) In addition, the Seller agrees to pay any present or future stamp or
other documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or under any other
Transaction Document or from the execution, delivery or registration of, or
otherwise with respect to, this Agreement or any other Transaction Document
(hereinafter referred to as "Other Taxes").
(c) The Seller will indemnify each Affected Person for the full amount of
Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section 2.10) paid by
such Affected Person and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto whether or not such Taxes or
Other Taxes were correctly or legally asserted. This indemnification shall be
made within thirty days from the date the Affected Person makes written demand
therefor (and a copy of such demand shall be delivered to the Program Agent and
the Investor Agent for such Affected Person's Group). A certificate as to the
amount of such indemnification submitted to the Seller and the Program Agent and
the Investor Agent for such Affected Person's Group by such Affected Person,
setting forth, in reasonable detail, the basis for and the calculation thereof,
shall be conclusive and binding for all purposes absent manifest error.
(d) Each Affected Person which is organized outside the United States and
which is entitled to an exemption from, or reduction of, withholding tax under
the laws of the United States as in effect on the date hereof (or, in the case
of any Person which becomes an Affected Person after the date hereof, on the
date on which it so becomes an Affected Person with respect to any payments
under this Agreement) shall, on or prior to the date hereof (or, in the case of
any Person who becomes an Affected Person after the date hereof, on or prior to
the date on which it so becomes an Affected Person), deliver to the Seller such
certificates, documents or other evidence, as required by the Internal Revenue
Code of 1986, as amended or Treasury Regulations issued pursuant thereto,
including Internal Revenue Service Form W-8BEN or Form W-8ECI and any other
certificate or statement of exemption required by Treasury Regulation Section
1.1441-1(a) or Section 1.1441-6(c) or any subsequent version thereof, properly
completed and duly executed by such Affected Person as will permit such payments
to be made without withholding or at a reduced rate. Each such Affected Person
shall from time to time thereafter, upon written request from the Seller,
deliver to the Seller any new
40
certificates, documents or other evidence as described in the preceding sentence
as will permit payments under this Agreement to be made without withholding or
at a reduced rate (but only so long as such Affected Person is legally able to
do so).
(e) The Seller shall not be required to pay any amounts to any Affected
Person in respect of Taxes and Other Taxes pursuant to paragraphs (a), (b) and
(c) above if the obligation to pay such amounts is attributable to the failure
by such Affected Person to comply with the provisions of paragraph (d) above;
provided, however, that should an Affected Person become subject to Taxes
because of its failure to deliver a form required hereunder, the Seller shall
take such steps as such Affected Person shall reasonably request to assist such
Affected Person to recover such Taxes; provided, that the Seller shall not be
required to incur any out-of-pocket expenses for complying with the previous
proviso.
SECTION 2.11. Security Interest. As collateral security for the performance
by the Seller of all the terms, covenants and agreements on the part of the
Seller (whether as Seller or otherwise) to be performed under this Agreement or
any document delivered in connection with this Agreement in accordance with the
terms thereof, including the punctual payment when due of all obligations of the
Seller hereunder or thereunder, whether for indemnification payments, fees,
expenses or otherwise, the Seller hereby assigns to the Program Agent for its
benefit and the ratable benefit of the Investors, the Banks and the Investor
Agents, and hereby grants to the Program Agent for its benefit and the ratable
benefit of the Investors, the Banks and the Investor Agents, a security interest
in, all of the Seller's right, title and interest in and to (A) the Originator
Purchase Agreement, including, without limitation, (i) all rights of the Seller
to receive moneys due or to become due under or pursuant to the Originator
Purchase Agreement, (ii) all security interests and property subject thereto
from time to time purporting to secure payment of monies due or to become due
under or pursuant to the Originator Purchase Agreement, (iii) all rights of the
Seller to receive proceeds of any insurance, indemnity, warranty or guaranty
with respect to the Originator Purchase Agreement, (iv) claims of the Seller for
damages arising out of or for breach of or default under the Originator Purchase
Agreement, and (v) the right of the Seller to compel performance and otherwise
exercise all remedies thereunder, (B) all Receivables, whether now owned and
existing or hereafter acquired or arising, the Related Security with respect
thereto and the Collections and all other assets, including, without limitation,
accounts, chattel paper, instruments and general intangibles (as those terms are
defined in the UCC), including undivided interests in any of the foregoing,
owned by the Seller and not otherwise purchased under this Agreement, (C) the
Lock-Box Accounts and the Cash Collateral Account and (D) to the extent not
included in the foregoing, all proceeds of any and all of the foregoing.
SECTION 2.12. Sharing of Payments. If any Investor or any Bank (for
purposes of this Section only, referred to as a "Recipient") shall obtain
payment (whether voluntary, involuntary, through the exercise of any right of
setoff, or otherwise) on account of the Capital of, or Yield on, any Receivable
Interest or portion thereof owned by it in excess of its ratable share of
payments made on account of the Capital of, or Yield on, all of the Receivable
Interests owned by the Investors and the Banks (other than as a result of a
payment of Liquidation Fee or different methods for calculating Yield or
payments made to less than all of the Groups as a result of the occurrence of a
Facility Termination Date under clause (d) of the defined term Facility
Termination Date for less than all of the Groups), such Recipient shall
41
forthwith purchase from the Investors or the Banks which received less than
their ratable share participations in the Receivable Interests owned by such
Persons as shall be necessary to cause such Recipient to share the excess
payment ratably with each such other Person; provided, however, that if all or
any portion of such excess payment is thereafter recovered from such Recipient,
such purchase from each such other Person shall be rescinded and each such other
Person shall repay to the Recipient the purchase price paid by such Recipient
for such participation to the extent of such recovery, together with an amount
equal to such other Person's ratable share (according to the proportion of (a)
the amount of such other Person's required payment to (b) the total amount so
recovered from the Recipient) of any interest or other amount paid or payable by
the Recipient in respect of the total amount so recovered.
ARTICLE III
CONDITIONS OF PURCHASES
SECTION 3.01. Conditions Precedent to Initial Purchase. The initial
purchase of a Receivable Interest under this Agreement is subject to the
conditions precedent that the Program Agent and each Investor Agent, as
applicable, shall have received on or before the date of such purchase the
following, each (unless otherwise indicated) dated such date, in form and
substance satisfactory to the Program Agent and each Investor Agent, as
applicable:
(a) Certified copies of the resolutions of the Board of Directors of the
Seller and the Originator approving this Agreement and certified copies of all
documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to this Agreement.
(b) A certificate of the Secretary or Assistant Secretary of the Seller and
the Originator certifying the names and true signatures of the officers of the
Seller and the Originator authorized to sign this Agreement and the other
documents to be delivered by it hereunder and thereunder.
(c) Acknowledgment copies or time stamped receipt copies of proper
financing statements, duly filed on or before the date of such initial purchase
under the UCC of all jurisdictions that the Program Agent may deem necessary or
desirable in order to perfect the ownership and security interests contemplated
by this Agreement and the Originator Purchase Agreement.
(d) Acknowledgment copies or time stamped receipt copies of proper
financing statements, if any, necessary to release all security interests and
other rights of any Person in (i) the Receivables, Contracts or Related Security
previously granted by the Seller or the Originator and (ii) the collateral
security referred to in Section 2.11 previously granted by the Seller.
(e) Completed requests for information, dated on or before the date of such
initial purchase, listing all effective financing statements filed in the
jurisdictions referred to in subsection (c) above that name the Seller or the
Originator as debtor, together with copies of such financing statements (none of
which shall cover any Receivables, Contracts, Related Security or the collateral
security referred to in Section 2.11).
42
(f) Intentionally omitted.
(g) A favorable opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, counsel for the Seller and
the Originator, substantially in the form of Annex C hereto and as to such other
matters as the Agent may reasonably request.
(h) The Fee Agreements.
(i) The Funds Transfer Letter, if applicable.
(j) Intentionally omitted.
(k) A copy of the by-laws of the Seller, certified by the Secretary or
Assistant Secretary of the Seller.
(l) (i) A copy of the certificate or articles of incorporation of the
Seller (which shall have been amended in a manner satisfactory to the Agent),
certified as of a recent date by the Secretary of State or other appropriate
official of the state of its organization, and (ii) a certificate as to the good
standing of the Seller from such Secretary of State or other official, dated as
of a recent date.
SECTION 3.02. Conditions Precedent to All Purchases and Reinvestments. Each
purchase (including the initial purchase) and each reinvestment shall be subject
to the further conditions precedent that (a) in the case of each purchase, the
Collection Agent shall have delivered to the Program Agent and each Investor
Agent at least one Business Day prior to such purchase (in the case of a Monthly
Report or a Weekly Report) and on the same day of (but prior to) such purchase
(in the case of a Daily Report), in form and substance satisfactory to the
Program Agent, a completed Monthly Report or, if required by Section 6.02(g)(ii)
a completed Weekly Report or if required by Section 6.02(g)(iii) a completed
Daily Report, containing information covering the most recently ended reporting
period for which information is required pursuant to Section 6.02(g)(i), (ii) or
(iii), as the case may be, and demonstrating that after giving effect to such
purchase no Pool Non-Compliance Date, Event of Termination or Incipient Event of
Termination under Section 7.01(i) would occur, (b) in the case of each
reinvestment, the Collection Agent shall have delivered to the Program Agent and
each Investor Agent on or prior to the date of such reinvestment, in form and
substance satisfactory to the Program Agent, a completed Monthly Report or, if
required by Section 6.02(g)(ii) a completed Weekly Report or if required by
Section 6.02(g)(iii) a completed Daily Report, in each case containing
information covering the most recently ended reporting period for which
information is required pursuant to Section 6.02(g)(i), (ii) or (iii), as the
case may be, (c) on the date of such purchase or reinvestment the following
statements shall be true, except that the statements in clause (iii) below is
required to be true only if such purchase or reinvestment is by an Investor (and
acceptance of the proceeds of such purchase or reinvestment shall be deemed a
representation and warranty by the Seller and the Collection Agent (each as to
itself) that such statements are then true):
(i) The representations and warranties contained in Sections 4.01 and 4.02
are correct on and as of the date of such purchase or reinvestment as though
made on and as of such date,
43
(ii) No event has occurred and is continuing, or would result
from such purchase or reinvestment, that constitutes an Event of Termination or
an Incipient Event of Termination,
(iii) The Program Agent shall not have given the Seller at
least one Business Day's notice that the Investors have terminated the
reinvestment of Collections in Receivable Interests or, with respect to any
reinvestment by a particular Investor, the Investor Agent for such Investor
shall not have given the Seller notice that such Investor has terminated the
reinvestment of Collections in Receivable Interests (unless such notice has been
revoked by such Investor Agent), and
(iv) The Originator shall have sold or contributed to the
Seller, pursuant to the Originator Purchase Agreement, all Originator
Receivables arising on or prior to such date, and
(d) The Program Agent and the Investor Agents shall have received such other
approvals, opinions or documents as the Program Agent or any Investor Agent may
reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Seller. The Seller
hereby represents and warrants as follows:
(a) The Seller is a corporation duly incorporated and validly existing
under the laws of Delaware, and is duly qualified to do business, and is in good
standing, in every jurisdiction where the nature of its business requires it to
be so qualified (including, without limitation, the State of Delaware) except to
the extent that the failure so to be so qualified would not reasonably be
expected to materially adversely affect the collectibility of the Receivables in
the Receivables Pool or the ability of the Seller to perform its obligations
under this Agreement.
(b) The execution, delivery and performance by the Seller of the
Transaction Documents and the other documents to be delivered by it hereunder,
including the Seller's use of the proceeds of purchases and reinvestments, (i)
are within the Seller's corporate powers, (ii) have been duly authorized by all
necessary corporate action, (iii) do not contravene (1) the Seller's charter or
by-laws, (2) any law, rule or regulation applicable to the Seller, (3) any
contractual restriction binding on or affecting the Seller or its property or
(4) any order, writ, judgment, award, injunction or decree binding on or
affecting the Seller or its property, and (iv) do not result in or require the
creation of any lien, security interest or other charge or encumbrance upon or
with respect to any of its properties (except for the interest created pursuant
to this Agreement). Each of the Transaction Documents has been duly executed and
delivered by the Seller.
(c) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body is required for the
due execution, delivery and performance by the Seller of the Transaction
Documents or any other document to be delivered thereunder, or to ensure that
the Program Agent will have an undivided ownership interest in and to the
Receivables, the Related Security and the Collections which is perfected
44
and prior to all other Liens, except for the filing of UCC financing statements
which are referred to therein (including, without limitation, the filing of
releases of UCC financing statements described in Section 3.01(d) hereof and
Section 3.01(d) of the Originator Purchase Agreement).
(d) Each of the Transaction Documents constitutes the legal, valid and
binding obligation of the Seller enforceable against the Seller in accordance
with its terms.
(e) The balance sheets of the Originator and its Subsidiaries as at
December 31, 2003, and the related statements of income and retained earnings of
the Originator and its Subsidiaries for the fiscal year then ended, copies of
which have been furnished to the Program Agent and each Investor Agent, fairly
present the financial condition of the Originator and its Subsidiaries as at
such date and the results of the operations of the Originator and its
Subsidiaries for the period ended on such date, all in accordance with GAAP
consistently applied, and since December 31, 2003 there has been no material
adverse change in the business, operations, property or financial or other
condition of the Originator. The pro forma balance sheet of the Seller as at
June 30, 2004, giving effect to the initial purchase to be made under this
Agreement, a copy of which has been furnished to the Program Agent and each
Investor Agent, fairly presents the financial condition of the Seller as at such
date, in accordance with GAAP, and since December 31, 2003 there has been no
material adverse change in the business, operations, property or financial or
other condition of the Seller.
(f) There is no pending or threatened action or proceeding affecting the
Originator or any of its Subsidiaries before any court, governmental agency or
arbitrator which may materially adversely affect the financial condition or
operations of the Originator or any of its Subsidiaries or the ability of the
Seller or the Originator to perform their respective obligations under the
Transaction Documents, or which purports to affect the legality, validity or
enforceability of the Transaction Documents; neither the Originator nor any
Subsidiary is in default with respect to any order of any court, arbitration or
governmental body except for defaults with respect to orders of governmental
agencies which defaults are not material to the business or operations of the
Originator and its Subsidiaries, taken as a whole.
(g) The use of all funds acquired by the Seller under this Agreement will
not conflict with or contravene any of Regulations T, U and X of the Board of
Governors of the Federal Reserve System as the same may from time to time be
amended, supplemented or otherwise modified.
(h) Immediately prior to the purchase by the relevant Investors and/or the
Banks, as the case may be, the Seller is the legal and beneficial owner of the
Pool Receivables and Related Security which are the subject of such purchase
free and clear of any Adverse Claim; upon each purchase or reinvestment, the
relevant Investors or the Banks, as the case may be, shall acquire an undivided
percentage ownership interest to the extent of the pertinent Receivable Interest
in each Pool Receivable then existing or thereafter arising and in the Related
Security and Collections with respect thereto. No effective financing statement
or other instrument similar in effect covering any Contract or any Pool
Receivable or the Related Security or Collections with respect thereto is on
file in any recording office, except those filed in favor of the Program Agent
relating to this Agreement and those filed by the Seller pursuant to the
Originator Purchase Agreement.
45
(i) Each Seller Report (if prepared by the Seller or one of its Affiliates,
or to the extent that information contained therein is supplied by the Seller or
an Affiliate), information, exhibit, financial statement, document, book, record
or report furnished or to be furnished at any time by or on behalf of the Seller
to the Program Agent, the Investor Agents, the Investors or the Banks in
connection with this Agreement is or will be accurate in all material respects
as of the date so furnished, and no such document contains or will contain any
untrue statement of a material fact or omits or will omit to state a material
fact necessary in order to make the statements contained therein, in the light
of the circumstances under which they were made, not misleading.
(j) The principal place of business and chief executive office of the
Seller and the office where the Seller keeps its records concerning the Pool
Receivables are located at the address or addresses referred to in Section
5.01(b).
(k) The names and addresses of all the Lock-Box Banks and the Cash
Collateral Bank, together with the account numbers of the Lock-Box Accounts and
the Cash Collateral Account of the Seller at such Lock-Box Banks and the Cash
Collateral Bank, respectively, are as specified in Schedule I hereto, as such
Schedule I may be updated from time to time pursuant to Section 5.01(g).
(l) Each purchase of a Receivable Interest and each reinvestment of
Collections in Pool Receivables will constitute (i) a "current transaction"
within the meaning of Section 3(a)(3) of the Securities Act of 1933, as amended,
and (ii) a purchase or other acquisition of notes, drafts, acceptances, open
accounts receivable or other obligations representing part or all of the sales
price of merchandise, insurance or services within the meaning of Section
3(c)(5) of the Investment Company Act of 1940, as amended.
(m) The Seller is not known by and does not use any tradename or
doing-business-as name.
(n) Immediately prior to the effectiveness of this Agreement the Seller has
no Debt, Adverse Claims on any of its assets, liabilities (including contingent
obligations) other than accrued administrative expenses (including, without
limitation, accrued rent) in an aggregate amount no to exceed $20,000. The
Seller has no Subsidiaries.
(o) (i) The fair value of the property of the Seller is greater than the
total amount of liabilities, including contingent liabilities, of the Seller,
(ii) the present fair salable value of the assets of the Seller is not less than
the amount that will be required to pay all probable liabilities of the Seller
on its debts as they become absolute and matured, (iii) the Seller does not
intend to, and does not believe that it will, incur debts or liabilities beyond
the Seller's abilities to pay such debts and liabilities as they mature and (iv)
the Seller is not engaged in a business or a transaction, and is not about to
engage in a business or a transaction, for which the Seller's property would
constitute unreasonably small capital.
(p) With respect to each Pool Receivable, the Seller (i) shall have
received such Pool Receivable as a contribution to the capital of the Seller by
the Originator or (ii) shall have purchased such Pool Receivable from the
Originator in exchange for payment (made by the
46
Seller to the Originator in accordance with the provisions of the Originator
Purchase Agreement) of cash, Deferred Purchase Price, or a combination thereof
in an amount which constitutes fair consideration and reasonably equivalent
value. Each such sale referred to in clause (ii) of the preceding sentence shall
not have been made for or on account of an antecedent debt owed by the
Originator to the Seller and no such sale is or may be voidable or subject to
avoidance under any section of the Federal Bankruptcy Code.
SECTION 4.02. Representations and Warranties of the Collection Agent. The
Collection Agent (so long as the Originator or its designee is the Collection
Agent) hereby represents and warrants as follows:
(a) The Collection Agent is a corporation duly incorporated and validly
existing under the laws of Delaware, and is duly qualified to do business, and
is in good standing, in every jurisdiction where the nature of its business
requires it to be so qualified (including without limitation, the State of
Delaware) except to the extent that the failure so to be so qualified would not
reasonably be expected to materially adversely affect the collectibility of the
Receivables in the Receivables Pool or the ability of the Collection Agent to
perform its obligations under this Agreement.
(b) The execution, delivery and performance by the Collection Agent of this
Agreement and any other documents to be delivered by it hereunder (i) are within
the Collection Agent's corporate powers, (ii) have been duly authorized by all
necessary corporate action, (iii) do not contravene (1) the Collection Agent's
charter or by-laws, (2) any law, rule or regulation applicable to the Collection
Agent, (3) any contractual restriction binding on or affecting the Collection
Agent or its property or (4) any order, writ, judgment, award, injunction or
decree binding on or affecting the Collection Agent or its property, and (iv) do
not result in or require the creation of any lien, security interest or other
charge or encumbrance upon or with respect to any of its properties. This
Agreement has been duly executed and delivered by the Collection Agent.
(c) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body is required for the
due execution, delivery and performance by the Collection Agent of this
Agreement or any other document to be delivered by it hereunder.
(d) This Agreement constitutes the legal, valid and binding obligation of
the Collection Agent enforceable against the Collection Agent in accordance with
its terms.
(e) The balance sheets of the Collection Agent and its Subsidiaries as at
December 31, 2003, and the related statements of income and retained earnings of
the Collection Agent and its Subsidiaries for the fiscal year then ended, copies
of which have been furnished to the Program Agent and each Investor Agent,
fairly present the financial condition of the Collection Agent and its
Subsidiaries as at such date and the results of the operations of the Collection
Agent and its Subsidiaries for the period ended on such date, all in accordance
with GAAP consistently applied, and since December 31, 2003 there has been no
material adverse change in the business, operations, property or financial or
other condition of the Collection Agent. The pro forma balance sheet of the
Seller as at June 30, 2004, giving effect to the initial
47
purchase to be made under this Agreement, a copy of which has been furnished to
the Program Agent and each Investor Agent, fairly presents the financial
condition of the Seller as at such date, in accordance with GAAP, and since
December 31, 2003 there has been no material adverse change in the business,
operations, property or financial or other condition of the Seller.
(f) There is no pending or threatened action or proceeding affecting the
Collection Agent or any of its Subsidiaries before any court, governmental
agency or arbitrator which may materially adversely affect the financial
condition or operations of the Collection Agent or any of its Subsidiaries or
the ability of the Collection Agent to perform its obligations under this
Agreement, or which purports to affect the legality, validity or enforceability
of this Agreement.
(g) On the date of each purchase and reinvestment (and after giving effect
thereto), the Net Receivables Pool Balance is not less than the Required Net
Receivable Pool Balance.
(h) Immediately prior to the effectiveness of this Agreement the Seller has
no Debt, Adverse Claims on any of its assets, liabilities (including contingent
obligations) other than accrued administrative expenses (including, without
limitation, accrued rent) in an aggregate amount no to exceed $20,000.
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Seller. Until the latest of the Facility
Termination Date or the date on which no Capital of or Yield on any Receivable
Interest shall be outstanding or the date all other amounts owed by the Seller
hereunder to the Investors, the Banks, the Investor Agents or the Program Agent
are paid in full:
(a) Compliance with Laws, Etc. The Seller will comply in all material
respects with all applicable laws, rules, regulations and orders and preserve
and maintain its corporate existence, rights, franchises, qualifications, and
privileges except to the extent that the failure so to comply with such laws,
rules and regulations or the failure so to preserve and maintain such rights,
franchises, qualifications, and privileges would not materially adversely affect
the collectibility of the Receivables Pool or the ability of the Seller to
perform its obligations under the Transaction Documents.
(b) Offices, Records, Name and Organization. The Seller will keep its
principal place of business and chief executive office and the office where it
keeps its records concerning the Pool Receivables at the address of the Seller
set forth under its name on the signature pages to this Agreement or, upon 30
days' prior written notice to the Program Agent and each Investor Agent, at any
other locations within the United States. The Seller will not change its name or
its state of organization, unless (i) the Seller shall have provided the Program
Agent and each Investor Agent with at least 30 days' prior written notice
thereof and (ii) no later than the effective date of such change, all actions
reasonably requested by the Program Agent to protect and perfect the interest in
the Pool Receivables have been taken and completed. The Seller also will
maintain and implement administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing Pool Receivables
and related Contracts 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 Pool Receivables
(including,
48
without limitation, records adequate to permit the daily identification of each
Pool Receivable and all Collections of and adjustments to each existing Pool
Receivable).
(c) Performance and Compliance with Contracts and Credit and Collection
Policy. The Seller will, at its expense, timely and fully perform and comply
with all material provisions, covenants and other promises required to be
observed by it under the Contracts related to the Pool Receivables, and timely
and fully comply in all material respects with the Credit and Collection Policy
in regard to each Pool Receivable and the related Contract.
(d) Sales, Liens, Etc. Except for the ownership and security interests
created hereunder in favor of the Program Agent, the Seller will not sell,
assign (by operation of law or otherwise) or otherwise dispose of, or create or
suffer to exist any Adverse Claim upon or with respect to, the Seller's
undivided interest in any Pool Receivable, Related Security, related Contract or
Collections, or upon or with respect to any account to which any Collections of
any Pool Receivable are sent, or assign any right to receive income in respect
thereof.
(e) Extension or Amendment of Receivables. Except as provided in Section
6.02(c), the Seller will not extend, amend or otherwise modify the terms of any
Pool Receivable, or amend, modify or waive any term or condition of any Contract
related thereto.
(f) Change in Business or Credit and Collection Policy. The Seller will not
make any change in the character of its business or in the Credit and Collection
Policy that would, in either case, materially adversely affect the
collectibility of the Receivables Pool or the ability of the Seller to perform
its obligations under this Agreement.
(g) Change in Payment Instructions to Obligors. The Seller will not add or
terminate any bank as a Lock-Box Bank or the Cash Collateral Bank from those
listed in Schedule I to this Agreement, or make any change in its instructions
to Obligors regarding payments to be made to the Seller or payments to be made
to any Lock-Box Bank, unless the Program Agent shall have received notice of
such addition, termination or change (including an updated Schedule I) and a
fully executed Lock-Box Agreement with each new Lock-Box Bank (or a fully
executed Cash Collateral Agreement with the new Cash Collateral Bank).
(h) Deposits to Lock-Box Accounts. The Seller will instruct all Obligors to
remit all their payments in respect of Receivables to Lock-Box Accounts. If the
Seller shall receive any Collections directly, it shall immediately (and in any
event within two Business Days) deposit the same to a Lock-Box Account.
(i) Marking of Records. At its expense, the Seller will ▇▇▇▇ its master
data processing records evidencing Pool Receivables with a legend evidencing
that Receivable Interests related to such Pool Receivables have been sold in
accordance with this Agreement.
(j) Further Assurances. (i) The Seller agrees from time to time, at its
expense, promptly to execute and deliver all further instruments and documents,
and to take all
49
further actions, that may be necessary or desirable, or that the Program Agent
or any Investor Agent may reasonably request, to perfect, protect or more fully
evidence the Receivable Interests purchased under this Agreement, or to enable
the Investors, the Banks, the Investor Agents or the Program Agent to exercise
and enforce their respective rights and remedies under this Agreement. Without
limiting the foregoing, the Seller will, upon the request of the Program Agent
or any Investor Agent, execute and file such financing or continuation
statements, or amendments thereto, and such other instruments and documents,
that may be necessary or desirable, or that the Agent may reasonably request, to
perfect, protect or evidence such Receivable Interests.
(ii) The Seller authorizes the Program Agent to file financing or
continuation statements, and amendments thereto and assignments thereof,
relating to the Pool Receivables and the Related Security, the related Contracts
and the Collections with respect thereto without the signature of the Seller
where permitted by law. A photocopy or other reproduction of this Agreement
shall be sufficient as a financing statement where permitted by law.
(k) Reporting Requirements. The Seller will provide to the Program Agent
and the Investor Agents (in multiple copies, if requested by the Program Agent
or any Investor Agent) the following:
(i) as soon as available and in any event within 60 days after the end of
the first three quarters of each fiscal year of the Originator, consolidated
balance sheets of the Originator and its Subsidiaries as of the end of such
quarter and consolidated statements of income and retained earnings of the
Originator and its Subsidiaries for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter, certified by a
Responsible Financial Officer of the Originator;
(ii) as soon as available and in any event within 105 days after the end of
each fiscal year of the Originator, a copy of the annual report for such year
for the Originator and its Subsidiaries on a consolidated basis, containing
financial statements for such year audited by PricewaterhouseCoopers LLP or
other independent public accountants acceptable to the Program Agent;
(iii) as soon as available and in any event within 60 days after the end of
the first three quarters and within 105 days after the end of the fourth fiscal
quarter of each fiscal year of the Seller, a balance sheet of the Seller as of
the end of such quarter and a statement of income and retained earnings of the
Seller for the period commencing at the end of the previous fiscal year and
ending with the end of such quarter, certified by a Responsible Financial
Officer of the Seller;
(iv) as soon as possible and in any event within five days after the
occurrence of each Event of Termination or Incipient Event of Termination, a
statement of a Responsible Financial Officer of the Seller setting forth details
of such Event of Termination or Incipient Event of Termination and the action
that the Seller has taken and proposes to take with respect thereto;
50
(v) promptly after the sending or filing thereof, copies of all reports
that the Originator sends to any of its security holders, and copies of all
reports and registration statements that the Originator or any of its
Subsidiaries files with the SEC or any national securities exchange;
(vi) promptly after the Seller obtains knowledge thereof, notice of the
occurrence of any ERISA Event that, alone or together with any other ERISA
Events that have occurred, could reasonably be expected to result in liability
of the Seller and any ERISA Affiliates in an aggregate amount exceeding
$25,000,000;
(vii) at least 30 days prior to any change in the name or jurisdiction of
organization of the Originator, a notice setting forth the new name or
jurisdiction of organization and the effective date thereof;
(viii) promptly after the Seller obtains knowledge thereof, notice of any
"Event of Termination" or "Facility Termination Date" under the Originator
Purchase Agreement or any "Event of Default" under the Credit Facility;
(ix) so long as any Capital shall be outstanding, as soon as possible and
in any event no later than the day of occurrence thereof, notice that the
Originator has stopped selling or contributing to the Seller, pursuant to the
Originator Purchase Agreement, all newly arising Originator Receivables;
(x) at the earlier of the time of the delivery of the financial statements
provided for in clauses (i), (ii) and (iii) of this paragraph or the date on
which such financial statement are required to be delivered, a certificate of a
Responsible Financial Officer of the Seller to the effect that, to the best of
such officer's knowledge, no Event of Termination has occurred and is continuing
or, if any Event of Termination has occurred and is continuing, specifying the
nature and extent thereof;
(xi) promptly after receipt thereof, copies of all notices received by the
Seller from the Originator under the Originator Purchase Agreement;
(xii) promptly after the Seller obtains knowledge thereof, notice that the
aggregate Outstanding Balance of Originator Receivables is greater than
$450,000,000; and
(xiii) such other information respecting the Receivables or the condition
or operations, financial or otherwise, of the Seller as the Program Agent or any
Investor Agent may from time to time reasonably request.
(l) Corporate Separateness. (i) The Seller shall at all times maintain at
least one independent director who is not currently and has not been during the
five years preceding the date of this Agreement an officer, director, employee
or shareholder of an Affiliate of the Seller or any Other Company.
(ii) The Seller shall not direct or participate in the management of any of
the Other Companies' operations or of any other Person's operations.
51
(iii) The Seller shall conduct a portion of its business from an office
separate from that of the Other Companies and any other Person (but which may be
located in the same facility as one or more of the Other Companies). The Seller
shall have stationery and other business forms and a mailing address and a
telephone number separate from that of the Other Companies and any other Person.
(iv) The Seller shall at all times be adequately capitalized in light of
its contemplated business.
(v) The Seller shall at all times provide for its own operating expenses
and liabilities from its own funds.
(vi) The Seller shall maintain its assets and transactions separately from
those of the Other Companies and any other Person and reflect such assets and
transactions in financial statements separate and distinct from those of the
Other Companies and any other Person and evidence such assets and transactions
by appropriate entries in books and records separate and distinct from those of
the Other Companies. The Seller shall hold itself out to the public under the
Seller's own name as a legal entity separate and distinct from the Other
Companies. The Seller shall not hold itself out as having agreed to pay, or as
being liable, primarily or secondarily, for, any obligations of the Other
Companies.
(vii) The Seller shall not maintain any joint account with any Other
Company or any other Person or become liable as a guarantor or otherwise with
respect to any Debt or contractual obligation of any Other Company or any other
Person.
(viii) The Seller shall not make any payment or distribution of assets with
respect to any obligation of any Other Company or any other Person or grant an
Adverse Claim on any of its assets to secure any obligation of any Other Company
or any other Person.
(ix) The Seller shall not make loans, advances or otherwise extend credit
to any of the Other Companies other than Purchaser Loans on the terms and
conditions set forth in the Originator Purchase Agreement.
(x) The Seller shall comply with all requirements of the laws of the State
of Delaware with respect to its corporate formation and maintenance of its
independent corporate existence.
(xi) The Seller shall have bills of sale (or similar instruments of
assignment) and, if appropriate, UCC-1 financing statements, with respect to all
assets purchased from any of the Other Companies.
(xii) The Seller shall not engage in any transaction with any of the Other
Companies, except as permitted by this Agreement and as contemplated by the
Originator Purchase Agreement.
(xiii) The Seller shall comply with (and cause to be true and correct) each
of the facts and assumptions contained in the "true sale/non-consolidation"
opinion of Pepper
52
▇▇▇▇▇▇▇▇ LLP delivered pursuant to Section 3.01(g) and designated as Annex C to
this Agreement.
(m) Originator Purchase Agreement. The Seller will not amend, waive or
modify any provision of the Originator Purchase Agreement (provided that the
Seller may extend the "Facility Termination Date" thereunder) or waive the
occurrence of any "Event of Termination" under the Originator Purchase
Agreement, without in each case the prior written consent of the Program Agent
and each Investor Agent. The Seller will perform all of its obligations under
the Originator Purchase Agreement in all material respects and will enforce the
Originator Purchase Agreement in accordance with its terms in all material
respects.
(n) Nature of Business. The Seller will not engage in any business other
than the purchase or acquisition of Receivables, Related Security and
Collections from the Originator and the transactions contemplated by this
Agreement. The Seller will not create or form any Subsidiary.
(o) Mergers, Etc. The Seller will not merge with or into or consolidate
with or into, or convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions), all or substantially all of its
assets (whether now owned or hereafter acquired) to, or acquire all or
substantially all of the assets or capital stock or other ownership interest of,
or enter into any joint venture or partnership agreement with, any Person, other
than as contemplated by this Agreement and the Originator Purchase Agreement.
(p) Distributions, Etc. The Seller will not declare or make any dividend
payment or other distribution of assets, properties, cash, rights, obligations
or securities on account of any shares of any class of capital stock of the
Seller, or return any capital to its shareholders as such, or purchase, retire,
defease, redeem or otherwise acquire for value or make any payment in respect of
any shares of any class of capital stock of the Seller or any warrants, rights
or options to acquire any such shares, now or hereafter outstanding; provided,
however, that the Seller may declare and pay cash dividends or return capital on
its capital stock to its shareholders so long as (i) no Event of Termination
shall then exist or would occur as a result thereof, (ii) such dividends are in
compliance with all applicable law including the corporate law of the state of
Seller's incorporation, and (iii) such dividends have been approved by all
necessary and appropriate corporate action of the Seller.
(q) Debt. The Seller will not incur any Debt, other than any Debt incurred
pursuant to this Agreement and the Deferred Purchase Price.
(r) Certificate of Incorporation. The Seller will not amend or delete
Articles THIRD, FIFTH, SEVENTH, TENTH, ELEVENTH, TWELFTH or FOURTEENTH of its
certificate of incorporation.
(s) Tangible Net Worth. The Seller will maintain Tangible Net Worth at all
times equal to at least 3% of the Outstanding Balance of the Receivables at such
time.
(t) Misdirected Payments. The Seller will not deposit or otherwise credit,
or cause to be so deposited or credited, to any Lock-Box Account cash or cash
proceeds other than Collections of Receivables. The Seller shall use
commercially reasonable efforts (including,
53
without limitation, sending notices from time to time to any Person depositing
or crediting to any Lock-Box Account cash or cash proceeds which are not
Collections of Receivables) to prevent cash or cash proceeds other than
Collections of Receivables from being deposited or credited to any Lock-Box.
(u) No Commingling. In the event that any cash or cash proceeds other than
Collections of Receivables are deposited or credited to any Lock-Box Account,
the Seller shall, or shall cause, such cash or cash proceeds to be identified
and withdrawn from the Lock-Box Account within three Business Days of such
deposit or credit.
SECTION 5.02. Covenant of the Seller and the Originator. Until the latest
of the Facility Termination Date or the date on which no Capital of or Yield on
any Receivable Interest shall be outstanding or the date all other amounts owed
by the Seller hereunder to the Investors, the Banks, the Investor Agents or the
Program Agent are paid in full, each of the Seller and the Originator will, at
their respective expense (other than expenses incurred in connection with the
Program Agent's routine annual due diligence visit), from time to time during
regular business hours as requested by the Program Agent or any Investor Agent,
permit the Program Agent, any Investor Agent or their respective agents or
representatives (including independent public accountants, which may be the
Seller's or the Originator's independent public accountants), (i) to conduct, on
a reasonable and customary basis, periodic audits of the Receivables, the
Related Security and the related books and records and collections systems of
the Seller or the Originator, as the case may be, (ii) 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 the Seller or the Originator, as the case may be, relating to Pool
Receivables and the Related Security, including, without limitation, the
Contracts, and (iii) to visit the offices and properties of the Seller or the
Originator, as the case may be, for the purpose of examining such materials
described in clause (ii) above, and to discuss matters relating to Pool
Receivables and the Related Security or the Seller's or the Originator's
performance under the Transaction Documents or under the Contracts with any of
the officers or employees of the Seller or the Originator, as the case may be,
having knowledge of such matters. In addition, upon the Program Agent's or any
Investor Agent's request at least once per year, the Seller will, at its
expense, appoint independent public accountants (which may, with the consent of
the Program Agent, be the Seller's regular independent public accountants), or
utilize the Program Agent's representatives or auditors, to prepare and deliver
to the Program Agent and each Investor Agent a written report with respect to
the Receivables and the Credit and Collection Policy (including, in each case,
the systems, procedures and records relating thereto) on a scope and in a form
reasonably and customarily requested by the Program Agent and the Investor
Agents.
ARTICLE VI
ADMINISTRATION AND COLLECTION
OF POOL RECEIVABLES
SECTION 6.01. Designation of Collection Agent. The servicing,
administration and collection of the Pool Receivables shall be conducted by the
Collection Agent so designated hereunder from time to time. Until the Program
Agent gives notice to the Seller
54
and the Investor Agents of the designation of a new Collection Agent (which
notice may only be given following the occurrence of a Collection Agent
Default), the Originator is hereby designated as, and hereby agrees to perform
the duties and obligations of, the Collection Agent pursuant to the terms
hereof. The Program Agent, at any time after the occurrence of a Collection
Agent Default, may designate, with the consent of the Investor Agents, as
Collection Agent any Person (including itself) to succeed the Originator or any
successor Collection Agent, if such Person shall consent and agree to the terms
hereof. The Collection Agent may, with the prior consent of the Program Agent
and each Investor Agent, subcontract with any other Person for the servicing,
administration or collection of the Pool Receivables. Any such subcontract shall
not affect the Collection Agent's liability for performance of its duties and
obligations pursuant to the terms hereof and any such subcontract shall
automatically terminate upon designation of a Successor Collection Agent.
SECTION 6.02. Duties of Collection Agent. (a) The Collection Agent shall
take or cause to be taken all such actions as may be necessary or advisable to
collect each Pool Receivable from time to time, all in accordance with
applicable laws, rules and regulations, with reasonable care and diligence, and
in accordance with the Credit and Collection Policy. The Seller, the Program
Agent, the Investor Agents, the Banks and the Investors hereby appoint the
Collection Agent, from time to time designated pursuant to Section 6.01, as
agent for themselves and for the Investors and the Banks to enforce their
respective rights and interests in the Pool Receivables, the Related Security
and the related Contracts. In performing its duties as Collection Agent, the
Collection Agent shall exercise the same care and apply the same policies as it
would exercise and apply if it owned such Receivables and shall act in the best
interests of the Seller, the Investors, the Banks, the Investor Agents and the
Program Agent.
(b) The Collection Agent shall administer the Collections in accordance
with the procedures described in Section 2.04.
(c) If no Event of Termination or Incipient Event of Termination shall have
occurred and be continuing, the Originator, while it is the Collection Agent,
may, in accordance with the Credit and Collection Policy, extend the maturity or
adjust the Outstanding Balance of any Receivable as the Originator deems
appropriate to maximize Collections thereof, or otherwise amend or modify other
terms of any Receivable, provided that the classification of any such Receivable
as a Delinquent Receivable or Defaulted Receivable shall not be affected by any
such extension.
(d) The Collection Agent shall hold in trust for the Seller and each
Investor and Bank, in accordance with their respective interests, all documents,
instruments and records (including, without limitation, computer tapes or disks)
which evidence or relate to Pool Receivables. The Collection Agent shall ▇▇▇▇
the Seller's master data processing records evidencing the Pool Receivables with
a legend, acceptable to the Program Agent, evidencing that Receivable Interests
therein have been sold and, at the request of the Program Agent, shall ▇▇▇▇
conspicuously each invoice evidencing each Pool Receivable and the related
Contract with such a legend.
(e) The Collection Agent shall, within three Business Days following
receipt thereof, turn over to the Originator any cash collections or other cash
proceeds received with
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respect to Excluded Receivables, and, turn over to the Seller any cash
collections or other cash proceeds received with respect to Receivables not
constituting Pool Receivables.
(f) The Collection Agent shall, from time to time at the request of the
Program Agent or any Investor Agent, furnish to the Program Agent and the
Investor Agents (promptly after any such request) a calculation of the amounts
set aside for the Investors, the Banks and the Investor Agents pursuant to
Section 2.04.
(g) (i) On or prior to the 20th calendar day of each month (or if such day
is not a Business Day, the next Business Day), the Collection Agent shall
prepare and forward to the Program Agent and each Investor Agent a Monthly
Report relating to the Receivable Interests outstanding on the last day of the
immediately preceding month.
(ii) If a Level I Downgrade Event (but no Level II Downgrade Event) shall
have occurred and be continuing, on or prior to the close of business on the
second Business Day of each Week, the Collection Agent shall prepare and forward
to the Program Agent and each Investor Agent a Weekly Report which shall contain
information related to the Receivables current as of the close of business on
the last Business Day of the preceding Week.
(iii) If a Level II Downgrade Event shall have occurred and be continuing,
the Collection Agent shall, by no later than 3:00 P.M. (New York City time) on
each Business Day, prepare and forward to the Program Agent and each Investor
Agent a Daily Report which shall contain information relating to the Receivables
current as of the close of business on the immediately prior Business Day.
The Collection Agent may elect to transmit Seller Reports to the Program
Agent and each Investor Agent by electronic mail (each an "E-Mail Seller
Report") provided, that (i) the Collection Agent shall (A) make arrangements
with VeriSign, Inc. (or another authenticating organization acceptable to the
Program Agent and each Investor Agent) to enable the Collection Agent to
generate digital signatures and (B) safeguard the keys, access codes or other
means of generating its digital signature, (ii) each E-Mail Seller Report shall
be (A) formatted as the Program Agent and each Investor Agent may designate from
time to time and shall be digitally signed and (B) sent to the Program Agent and
each Investor at an electronic mail address designated by such Agent, and (iii)
the Program Agent and each Investor (A) shall be authorized to rely upon such
E-Mail Seller Report for purposes of this Agreement to the same extent as if the
contents thereof had been otherwise delivered to such Agent in accordance with
the terms of this Agreement and (B) may, upon notice in writing to the
Collection Agent and the Seller, terminate the right of the Collection Agent to
transmit E-Mail Seller Reports.
SECTION 6.03. Certain Rights of the Agents. (a) The Program Agent shall not
deliver to the Lock-Box Banks the Notices of Effectiveness attached to the
Lock-Box Agreements unless and until a Cash Control Triggering Event shall have
occurred. The Seller hereby transfers to the Program Agent the exclusive
ownership and control of the Lock-Box Accounts to which the Obligors of Pool
Receivables shall make payments and the Cash Collateral Account.
(b) At any time following a Cash Control Triggering Event:
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(i) The Program Agent may notify the Obligors of Pool Receivables (with a
copy to the Investor Agents), at the Seller's expense, of the ownership of
Receivable Interests under this Agreement and direct that all payments be made
directly to the Program Agent or its designee.
(ii) At the Agents' request and at the Seller's expense, the Seller shall
notify each Obligor of Pool Receivables (with a copy to the Program Agent and
each Investor Agent) of the ownership of Receivable Interests under this
Agreement and direct that payments be made directly to the Program Agent or its
designee.
(iii) At the Program Agent's request and at the Seller's expense, the
Seller and the Collection Agent shall (A) assemble all of the documents,
instruments and other records (including, without limitation, computer tapes and
disks) that evidence or relate to the Pool Receivables and the related Contracts
and Related Security, or that are otherwise necessary or desirable to collect
the Pool Receivables, and shall make the same available to the Program Agent at
a place selected by the Program Agent or its designee, and (B) segregate all
cash, checks and other instruments received by it from time to time constituting
Collections of Pool Receivables in a manner acceptable to the Program Agent and,
promptly upon receipt, remit all such cash, checks and instruments, duly
indorsed or with duly executed instruments of transfer, to the Program Agent or
its designee.
(iv) The Seller authorizes the Program Agent to take any and all steps in
the Seller's name and on behalf of the Seller that are necessary or desirable,
in the determination of the Program Agent, to collect amounts due under the Pool
Receivables, including, without limitation, endorsing the Seller's name on
checks and other instruments representing Collections of Pool Receivables and
enforcing the Pool Receivables and the Related Security and related Contracts.
SECTION 6.04. Rights and Remedies. (a) If the Collection Agent fails to
perform any of its obligations under this Agreement, the Program Agent may (but
shall not be required to) itself perform, or cause performance of, such
obligation; and the Program Agent's costs and expenses incurred in connection
therewith shall be payable by the Collection Agent.
(b) The Seller and the Originator shall perform their respective
obligations under the Contracts related to the Pool Receivables to the same
extent as if Receivable Interests had not been sold and the exercise by the
Program Agent on behalf of the Investors, the Banks and the Investor Agents of
their rights under this Agreement shall not release the Collection Agent or the
Seller from any of their duties or obligations with respect to any Pool
Receivables or related Contracts. Neither the Program Agent, the Investors, the
Banks nor the Investor Agents shall have any obligation or liability with
respect to any Pool Receivables or related Contracts, nor shall any of them be
obligated to perform the obligations of the Seller thereunder.
(c) In the event of any conflict between the provisions of Article VI of
this Agreement and Article VI of the Originator Purchase Agreement, the
provisions of Article VI of this Agreement shall control.
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SECTION 6.05. Further Actions Evidencing Purchases. The Originator agrees
from time to time, at its expense, to promptly execute and deliver all further
instruments and documents, and to take all further actions, that may, to its
knowledge, be necessary or desirable, or that the Program Agent or any Investor
Agent may reasonably request, to perfect, protect or more fully evidence the
Receivable Interests purchased hereunder, or to enable the Investors, the Banks,
the Investor Agents or the Program Agent to exercise and enforce their
respective rights and remedies hereunder. Without limiting the foregoing, the
Originator will (i) upon the request of the Program Agent or any Investor Agent,
execute and file such financing or continuation statements, or amendments
thereto, and such other instruments and documents, that the Program Agent or any
Investor Agent may reasonably request, to perfect, protect or evidence such
Receivable Interests; (ii) ▇▇▇▇ its master data processing records evidencing
the Pool Receivables with a legend, acceptable to the Program Agent, evidencing
that Receivable Interests therein have been sold; and (iii) upon an Event of
Termination and the request of the Program Agent or any Investor Agent, ▇▇▇▇
conspicuously each invoice evidencing each Pool Receivable with such a legend.
SECTION 6.06. Covenants of the Collection Agent and the Originator. (a)
Audits. The Collection Agent will, from time to time during regular business
hours as requested by the Program Agent or any Investor Agent, on a reasonable
and customary basis, permit the Program Agent or such Investor Agent, or their
agents or representatives (including independent public accountants, which may
be the Collection Agent's independent public accountants), (i) to conduct
periodic audits of the Receivables, the Related Security and the related books
and records and collections systems of the Collection Agent, (ii) 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 the Collection Agent relating to Pool Receivables and the Related
Security, including, without limitation, the Contracts, and (iii) to visit the
offices and properties of the Collection Agent for the purpose of examining such
materials described in clause (ii) above, and to discuss matters relating to
Pool Receivables and the Related Security or the Collection Agent's performance
hereunder with any of the officers or employees of the Collection Agent having
knowledge of such matters.
(b) Change in Credit and Collection Policy. The Originator will not make
any change in the Credit and Collection Policy that would impair the
collectibility of any Pool Receivable or the ability of the Originator (if it is
acting as Collection Agent) to perform its obligations under this Agreement. In
the event that the Collection Agent or the Originator makes any change to the
Credit and Collection Policy, it shall, within five Business Days of such
change, provide the Program Agent and each Investor Agent with an updated Credit
and Collection Policy and a summary of all material changes.
SECTION 6.07. Indemnities by the Collection Agent. Without limiting any
other rights that the Program Agent, any Investor Agent, any Investor, any Bank
or any of their respective Affiliates (each, a "Special Indemnified Party") may
have hereunder or under applicable law, and in consideration of its appointment
as Collection Agent, the Collection Agent hereby agrees to indemnify each
Special Indemnified Party from and against any and all claims, losses and
liabilities (including reasonable attorneys' fees) (all of the foregoing being
collectively referred to as "Special Indemnified Amounts") arising out of or
resulting from any of the following (excluding, however, (a) Special Indemnified
Amounts to the extent found by a court
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of competent jurisdiction to have resulted from gross negligence or willful
misconduct on the part of such Special Indemnified Party, (b) recourse for
uncollectible Receivables or (c) any income taxes or any other tax or fee
measured by income incurred by such Special Indemnified Party arising out of or
as a result of this Agreement or the ownership of Receivable Interests or in
respect of any Receivable or any Contract):
(i) any representation made or deemed made by the Collection Agent pursuant
to Section 4.02(g) hereof which shall have been incorrect in any respect when
made or any other representation or warranty or statement made or deemed made by
the Collection Agent under or in connection with this Agreement which shall have
been incorrect in any material respect when made;
(ii) the failure by the Collection Agent to comply with any applicable law,
rule or regulation with respect to any Pool Receivable or Contract; or the
failure of any Pool Receivable or Contract to conform to any such applicable
law, rule or regulation;
(iii) the failure to have filed, or any delay in filing, financing
statements or other similar instruments or documents under the UCC of any
applicable jurisdiction or other applicable laws with respect to any Receivables
in, or purporting to be in, the Receivables Pool, the Contracts and the Related
Security and Collections in respect thereof, whether at the time of any purchase
or reinvestment or at any subsequent time;
(iv) any failure of the Collection Agent to perform its duties or
obligations in accordance with the provisions of this Agreement;
(v) the commingling of Collections of Pool Receivables at any time by the
Collection Agent with other funds;
(vi) any action or omission by the Collection Agent reducing or impairing
the rights of the Program Agent, the Investor Agents, the Investors or the Banks
with respect to any Pool Receivable or the value of any Pool Receivable;
(vii) any Collection Agent Fees or other costs and expenses payable to any
replacement Collection Agent, to the extent in excess of the Collection Agent
Fees payable to the Collection Agent hereunder; or
(viii) any claim brought by any Person other than a Special Indemnified
Party arising from any activity by the Collection Agent or its Affiliates in
servicing, administering or collecting any Receivable.
SECTION 6.08. Cash Collateral Account. Within 10 Business Days following a
Level I Downgrade Event (and in any event within two Business Days following a
Level II Downgrade Event), the Collection Agent shall establish and maintain or
cause to be established and maintained in the name of the Seller, for the
benefit of the Investor Agents, the Investors and the Banks and under the sole
dominion and control of the Program Agent, with a financial institution
acceptable to the Program Agent and each Investor Agent a segregated interest
bearing deposit account (the "Cash Collateral Account", and such financial
institution holding such account a "Cash Collateral Bank"). Such Cash Collateral
Account shall be subject
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to a Cash Collateral Agreement in form and substance satisfactory to the Program
Agent, each Investor Agent, the Seller, the Collection Agent and the Cash
Collateral Bank (the "Cash Collateral Agreement").
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01. Events of Termination. If any of the following events
("Events of Termination") shall occur and be continuing:
(a) The Collection Agent (i) shall fail to perform or observe any term,
covenant or agreement under this Agreement (other than as referred to in clauses
(ii), (iii), (iv), (v) or (vi) of this subsection (a)) and such failure shall
remain unremedied for 10 Business Days, (ii) shall fail to make when due any
payment or deposit with respect to Fees or Yield to be made by it under this
Agreement and such failure shall remain unremedied for one Business Day after
notice thereof has been delivered by the Program Agent or any Investor Agent,
(iii) shall fail to make when due any payment or deposit with respect to Capital
to be made by it under this Agreement, (iv) (A) shall fail to deliver when due
any Weekly Report or Daily Report and such failure shall remain unremedied for
more than two Business Days, in the case of a Weekly Report, or for more than
one Business Day, in the case of a Daily Report, or (B) shall fail to deliver
when due more than two Weekly Reports in any calendar month or more than two
Daily Reports in any calendar week, (v) shall fail to deposit into the Cash
Collateral Account, when due, the correct amount of any deposit required to be
made into such account, or (vi) shall fail to perform or observe any term,
covenant or agreement contained in Sections 6.02 or 6.08 (other than as set
forth in clauses (ii), (iii), (iv) or (v) of this subsection) and such failure
shall remain unremedied for more than five Business Days; or
(b) The Seller shall fail to make any payment required under Section
2.04(f) on the Business Day on which the next payment in respect of Capital is
required to be made hereunder; or
(c) Any representation or warranty made or deemed made by the Seller or the
Collection Agent (or any of their respective officers) under or in connection
with this Agreement or any other Transaction Document or any information or
report delivered by the Seller or the Collection Agent pursuant to this
Agreement or any other Transaction Document shall prove to have been incorrect
or untrue in any material respect when made or deemed made or delivered;
provided, however, the making or deemed making of a incorrect or untrue
representation or warranty with respect to clause (iii)(2) of Section 4.01(b) or
Sections 4.01(d), (e), (f), (g), (i), (j), (k) or (m), or clause (iii)(2) of
Section 4.02(b) or Sections 4.02(d), (e) or (f) shall not constitute an Event of
Termination so long as within 10 Business Days after the earliest date on which
the Seller, the Originator or the Collection Agent obtains knowledge or receives
notice that any such representation or warranty is incorrect or untrue (i) the
Program Agent and each Investor Agent expressly waives in writing (at its sole
and absolute discretion), the Event of Termination which would otherwise arise
therefrom or (ii) the outstanding Capital hereunder is reduced to $0; or
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(d) The Seller or the Originator (i) shall fail to perform or observe any
other term, covenant or agreement contained in this Agreement (other than as
referred to in clauses (ii), (iii) or (iv) of this subsection (d)) on its part
to be performed or observed, (ii) shall fail to make when due any payment or
deposit with respect to Fees or Yield to be made by it under this Agreement and
such failure shall remain unremedied for one Business Day after notice thereof
has been delivered by the Program Agent or any Investor Agent, (iii) shall fail
to make when due any payment or deposit with respect to Capital to be made by it
under this Agreement, or (iv) shall fail to perform or observe any term,
covenant or agreement contained in (x) Section 5.01 (b), (e), (g), (h),(k)(vii),
(t) or Section 5.02 and such failure shall remain unremedied for 10 Business
Days from the earliest date that the Seller, the Originator or the Collection
Agent obtains knowledge or receives notice of such failure (provided, that with
respect to Section 5.01(g) and (h) no such grace period shall apply if the
aggregate amount of Collections subject to such failure shall exceed $1,000,000,
and provided, further, that with respect to Section 5.01(t) no such grace period
shall apply if the aggregate amount of Collections subject to such failure shall
exceed $10,000,000) or (y) Section 5.01(a), (c), (f), (i), (k)(i), (k)(ii),
(k)(iii), (k)(v), (k)(vi), (k)(x), (k)(xi) and (k)(xiii) and such failure shall
remain unremedied for 20 Business Days from the earliest date that the Seller,
the Originator or the Collection Agent obtains knowledge or receives notice of
such failure; or
(e) The Collection Agent or the Originator shall fail to pay any principal
of or premium or interest on any of its Debt which is outstanding in a principal
amount of at least $50,000,000 (such amount to be adjusted to reflect any change
in the amount set forth in the definition of "Material Indebtedness" in the
Credit Facility on a dollar for dollar basis pursuant to the renewal of the
Credit Facility on or prior to May 29, 2005) in the aggregate when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Debt; or any other event shall occur or condition shall exist
under any agreement or instrument relating to any such Debt and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such Debt; or any such Debt shall be
declared to be due and payable, or required to be prepaid (other than by a
regularly scheduled required prepayment), redeemed, purchased or defeased, or an
offer to repay, redeem, purchase or defease such Debt shall be required to be
made, in each case prior to the stated maturity thereof; or
(f) Any purchase or any reinvestment pursuant to this Agreement shall for
any reason (other than pursuant to the terms hereof) cease to create, or any
Receivable Interest shall for any reason cease to be, a valid and perfected
first priority undivided percentage ownership interest to the extent of the
pertinent Receivable Interest in each applicable Pool Receivable and the Related
Security and Collections with respect thereto; or the security interest created
pursuant to Section 2.11 shall for any reason cease to be a valid and perfected
first priority security interest in the collateral security referred to in that
section; or
(g) The Seller, Collection Agent or the Originator shall generally not pay
its debts as such debts become due, or shall admit in writing its inability to
pay its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the Seller or the
Originator seeking to adjudicate it a bankrupt or
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insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, custodian or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted against it
(but not instituted by it), either such proceeding shall remain undismissed or
unstayed for a period of 60 days, or any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, it or for any substantial part of its property) shall occur; or
the Seller or the Originator shall take any corporate action to authorize any of
the actions set forth above in this subsection (g); or
(h) As of the last day of any calendar month, (i) the three-month rolling
weighted average Dilution Ratio shall exceed 18%, (ii) the Default Ratio shall
exceed 11%, (iii) the Delinquency Ratio shall exceed 11% or (iv) the
Loss-to-Liquidation Ratio shall exceed 1.0%; provided, however, the foregoing
shall not constitute an Event of Termination so long as within 10 Business Days
after the earlier of (A) the date that the Seller Report setting forth such
calculations is required to be delivered by the Collection Agent pursuant to
Section 6.01(g) and (B) the actual date of delivery of such Seller Report,
either (i) the Program Agent and each Investor Agent expressly waives in
writing, the Event of Termination which would otherwise arise therefrom or (ii)
the outstanding Capital hereunder is reduced to $0; or
(i) (A) Prior to the occurrence of a Level I Downgrade Event, the sum of
the Receivable Interests shall on any Business Day be greater than 100% and
shall remain greater than 100% for a period of five consecutive Business Days;
(B) after the occurrence and during the continuation of a Level I Downgrade
Event (so long as no Level II Downgrade Event shall have occurred), the Net
Receivables Pool Balance is less than the Required Net Receivables Pool Balance
as of the close of business on the last Business Day of any Week and the Net
Receivables Pool Balance shall remain less than the Required Net Receivables
Pool Balance for a period of one Business Day after the delivery of the Weekly
Report for such Week; or (C) after the occurrence and during the continuation of
a Level II Downgrade Event, the Net Receivables Pool Balance is less than the
Required Net Receivables Pool Balance as of the close of business on any
Business Day and the Net Receivables Pool Balance shall remain less than the
Required Net Receivables Pool Balance for a period of one Business Day after the
delivery of the Daily Report for such Business Day;
(j) There shall occur any event which may (in the Program Agent and each
Investor Agent's reasonable judgment) materially adversely affect (i) the
collectibility of more than 20% of the Receivables in the Receivables Pool or
(ii) the ability of the Seller or the Collection Agent to collect Receivables
which constitute more than 20% of the Receivables which are Pool Receivables or
otherwise perform its obligations under this Agreement; provided, however, the
foregoing clause (i) shall not constitute an Event of Termination so long as
within 10 Business Days thereafter, either (A) the Program Agent and each
Investor Agent expressly waives in writing, the Event of Termination which would
otherwise arise therefrom or (B) the outstanding Capital hereunder is reduced to
$0; or
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(k) An "Event of Termination" or "Facility Termination Date" shall occur
under the Originator Purchase Agreement, or the Originator Purchase Agreement
shall cease to be in full force and effect, or the Seller or Originator shall
state so in writing; or
(l) All of the outstanding capital stock of the Seller shall cease to be
owned, directly or indirectly, by the Originator; or
(m) (i) The Consolidated Leverage Ratio shall exceed 3.5:1.00 at any time
or (ii) the Consolidated Interest Coverage Ratio for any period of four
consecutive fiscal quarters of the Originator shall be less than 4.00:1.00; or
(n) a Collection Agent Default shall occur;
then, and in any such event, any or all of the following actions may be taken by
notice to the Seller: (x) the Program Agent may in its discretion, and shall, at
the direction of any Investor Agent, declare the Facility Termination Date to
have occurred (in which case the Facility Termination Date shall be deemed to
have occurred), (y) the Program Agent may in its discretion, and shall, at the
direction of any Investor Agent, declare the Commitment Termination Date to have
occurred (in which case the Commitment Termination Date shall be deemed to have
occurred), and (z) without limiting any right under this Agreement to replace
the Collection Agent, the Program Agent may in its discretion, and shall, at the
direction of any Investor Agent, designate another Person to succeed the
Originator as the Collection Agent so long as a Collection Agent Default shall
have occurred and be continuing; provided, that, automatically upon the
occurrence of any event (without any requirement for the passage of time or the
giving of notice) described in paragraph (g) of this Section 7.01, the Facility
Termination Date and the Commitment Termination Date shall occur, the Originator
(if it is then serving as the Collection Agent) shall cease to be the Collection
Agent, and the Program Agent or its designee shall become the Collection Agent.
Upon any such declaration or designation or upon such automatic termination, the
Investors, the Banks, the Investor Agents and the Program Agent shall have, in
addition to the rights and remedies which they may have under this Agreement,
all other rights and remedies provided after default under the UCC and under
other applicable law, which rights and remedies shall be cumulative.
ARTICLE VIII
THE PROGRAM AGENT
SECTION 8.01. Authorization and Action. Each Investor and each Bank hereby
appoints and authorizes the Program Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement and the other
Transaction Documents as are delegated to the Program Agent by the terms hereof
or thereof, together with such powers as are reasonably incidental thereto. The
Program Agent shall not have any duties other than those expressly set forth in
the Transaction Documents, and no implied obligations or liabilities shall be
read into any Transaction Document, or otherwise exist, against the Program
Agent. The Program Agent does not assume, nor shall it be deemed to have
assumed, any obligation to, or relationship of trust or agency with, the Seller
or the Originator. Notwithstanding any provision of this Agreement or any other
Transaction Document, in no event shall the Program Agent ever
63
be required to take any action which exposes the Program Agent to personal
liability or which is contrary to any provision of any Transaction Document or
applicable law.
SECTION 8.02. Program Agent's Reliance, Etc. Neither the Program Agent nor
any of its directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or them as Program Agent under or in
connection with this Agreement (including, without limitation, the Program
Agent's servicing, administering or collecting Pool Receivables as Collection
Agent) or any other Transaction Document, except for its or their own gross
negligence or willful misconduct. Without limiting the generality of the
foregoing, the Program Agent: (a) may consult with legal counsel (including
counsel for any Investor Agent, the Seller and the Collection Agent),
independent certified public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts; (b)
makes no warranty or representation to any Investor Agent, Investor or Bank
(whether written or oral) and shall not be responsible to any Investor Agent,
Investor or Bank for any statements, warranties or representations (whether
written or oral) made in or in connection with this Agreement or any other
Transaction Document; (c) shall not have any duty to ascertain or to inquire as
to the performance or observance of any of the terms, covenants or conditions of
this Agreement or any other Transaction Document on the part of the Seller or
the Collection Agent or to inspect the property (including the books and
records) of the Seller or the Collection Agent; (d) shall not be responsible to
any Investor Agent, Investor or Bank for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
Transaction Document or any other instrument or document furnished pursuant
hereto or thereto; and (e) shall incur no liability under or in respect of this
Agreement or any other Transaction Document by acting upon any notice (including
notice by telephone), consent, certificate or other instrument or writing (which
may be by telecopier or telex) believed by it to be genuine and signed or sent
by the proper party or parties.
SECTION 8.03. CNAI and Affiliates. The obligation of Citibank to purchase
Receivable Interests under this Agreement may be satisfied by CNAI or any of its
Affiliates. With respect to any Receivable Interest or interest therein owned by
it, CNAI shall have the same rights and powers under this Agreement as any Bank
and may exercise the same as though it were not the Program Agent. CNAI and any
of its Affiliates may generally engage in any kind of business with the Seller,
the Collection Agent or any Obligor, any of their respective Affiliates and any
Person who may do business with or own securities of the Seller, the Collection
Agent or any Obligor or any of their respective Affiliates, all as if CNAI were
not the Program Agent and without any duty to account therefor to the Investor
Agents, the Investors or the Banks.
SECTION 8.04. Indemnification of Program Agent. Each Bank agrees to
indemnify the Program Agent (to the extent not reimbursed by the Seller or the
Originator), ratably according to the respective Percentage of such Bank, from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against the
Program Agent in any way relating to or arising out of this Agreement or any
other Transaction Document or any action taken or omitted by the Program Agent
under this Agreement or any other Transaction Document, provided that no Bank
shall be liable for any
64
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the Program
Agent's gross negligence or willful misconduct.
SECTION 8.05. Delegation of Duties. The Program Agent may execute any of
its duties through agents or attorneys-in-fact and shall be entitled to advice
of counsel concerning all matters pertaining to such duties. The Program Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
SECTION 8.06. Action or Inaction by Program Agent. The Program Agent shall
in all cases be fully justified in failing or refusing to take action under any
Transaction Document unless it shall first receive such advice or concurrence of
the Investor Agents and assurance of its indemnification by the Banks, as it
deems appropriate. The Program Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement or any other
Transaction Document in accordance with a request or at the direction of the
Investor Agents and such request or direction and any action taken or failure to
act pursuant thereto shall be binding upon all Investors, Banks, the Program
Agent and the Investor Agents.
SECTION 8.07. Notice of Events of Termination. The Program Agent shall not
be deemed to have knowledge or notice of the occurrence of any Incipient Event
of Termination or of any Event of Termination unless the Program Agent has
received notice from any Investor Agent, Investor, Bank, the Collection Agent,
the Originator or the Seller stating that an Incipient Event of Termination or
Event of Termination has occurred hereunder and describing such Incipient Event
of Termination or Event of Termination. If the Program Agent receives such a
notice, it shall promptly give notice thereof to each Investor Agent whereupon
each Investor Agent shall promptly give notice thereof to its respective
Investors and Related Banks. The Program Agent shall take such action concerning
an Incipient Event of Termination or an Event of Termination as may be directed
by the Investor Agents (subject to the other provisions of this Article VIII),
but until the Program Agent receives such directions, the Program Agent may (but
shall not be obligated to) take such action, or refrain from taking such action,
as the Program Agent deems advisable and in the best interests of the Investors
and Banks.
SECTION 8.08. Non-Reliance on Program Agent and Other Parties. Each
Investor Agent, Investor and Bank expressly acknowledges that neither the
Program Agent, any of its Affiliates nor any of their respective directors,
officers, agents or employees has made any representations or warranties to it
and that no act by the Program Agent hereafter taken, including any review of
the affairs of the Seller or the Originator, shall be deemed to constitute any
representation or warranty by the Program Agent. Each Investor and Bank
represents and warrants to the Program Agent that, independently and without
reliance upon the Program Agent, any of its Affiliates, any Investor Agent
(except to the extent otherwise agreed in writing between such Investor and its
Investor Agent) or any other Investor or Bank and based on such documents and
information as it has deemed appropriate, it has made and will continue to make
its own appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of the Seller and
the Originator, and the Receivable Interests and its own decision to enter into
this Agreement and to take, or omit, action under this
65
Agreement or any other Transaction Document. Except for items expressly required
to be delivered under this Agreement or any other Transaction Document by the
Program Agent to any Investor Agent, Investor or Bank, the Program Agent shall
not have any duty or responsibility to provide any Investor Agent, Investor or
Bank with any information concerning the Seller or the Originator or any of
their Affiliates that comes into the possession of the Program Agent or any of
its directors, officers, agents, employees, attorneys-in-fact or Affiliates.
SECTION 8.09. Successor Program Agent. The Program Agent may, upon at least
thirty (30) days' notice to the Seller and each Investor Agent, resign as
Program Agent. Such resignation shall not become effective until a successor
agent is appointed by the Investor Agents (with the approval of the Seller,
which approval shall not be unreasonably withheld and shall not be required if
an Incipient Event of Termination or an Event of Termination has occurred and is
continuing) and has accepted such appointment. Upon such acceptance of its
appointment as Program Agent hereunder by a successor Program Agent, such
successor Program Agent shall succeed to and become vested with all the rights
and duties of the retiring Program Agent, and the retiring Program Agent shall
be discharged from its duties and obligations under the Transaction Documents.
After any retiring Program Agent's resignation hereunder, the provisions of this
Article VIII and Section 6.07 and Article X shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was the Program Agent.
SECTION 8.10. Reports and Notices. The Program Agent hereby agrees to
provide each Investor Agent with copies of all material notices, reports and
other documents provided to the Program Agent by the Seller or the Collection
Agent hereunder (other than any notices received by the Program Agent referred
to in any of the definitions of Assignee Rate, Investor Rate or Fixed Period)
which are not otherwise required to be provided by the Seller or the Collection
Agent directly to the Investor Agents in accordance with the terms hereof.
ARTICLE IX
THE INVESTOR AGENTS
SECTION 9.01. Authorization and Action. Each Investor and each Bank which
belongs to the same Group hereby appoints and authorizes the Investor Agent for
such Group to take such action as agent on its behalf and to exercise such
powers under this Agreement and the other Transaction Documents as are delegated
to such Investor Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto. No Investor Agent shall have any
duties other than those expressly set forth in the Transaction Documents, and no
implied obligations or liabilities shall be read into any Transaction Document,
or otherwise exist, against any Investor Agent. No Investor Agent assumes, nor
shall it be deemed to have assumed, any obligation to, or relationship of trust
or agency with, the Seller or the Originator. Notwithstanding any provision of
this Agreement or any other Transaction Document, in no event shall any Investor
Agent ever be required to take any action which exposes such Investor Agent to
personal liability or which is contrary to any provision of any Transaction
Document or applicable law.
SECTION 9.02. Investor Agent's Reliance, Etc. No Investor Agent nor any of
its directors, officers, agents or employees shall be liable for any action
taken or omitted to be
66
taken by it or them as an Investor Agent under or in connection with this
Agreement or the other Transaction Documents (i) with the consent or at the
request or direction of the Investors and Banks in its Group or (ii) in the
absence of its or their own gross negligence or willful misconduct. Without
limiting the generality of the foregoing, an Investor Agent: (a) may consult
with legal counsel (including counsel for the Program Agent, the Seller, the
Collection Agent or the Originator), independent certified public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such
counsel, accountants or experts; (b) makes no warranty or representation to any
Investor or Bank (whether written or oral) and shall not be responsible to any
Investor or Bank for any statements, warranties or representations (whether
written or oral) made in or in connection with this Agreement or any other
Transaction Document; (c) shall not have any duty to ascertain or to inquire as
to the performance or observance of any of the terms, covenants or conditions of
this Agreement or any other Transaction Document on the part of the Seller, the
Originator or any other Person or to inspect the property (including the books
and records) of the Seller, the Originator or the Collection Agent; (d) shall
not be responsible to any Investor or any Bank for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement,
any other Transaction Documents or any other instrument or document furnished
pursuant hereto; and (e) shall incur no liability under or in respect of this
Agreement or any other Transaction Document by acting upon any notice (including
notice by telephone), consent, certificate or other instrument or writing (which
may be by telecopier or telex) believed by it to be genuine and signed or sent
by the proper party or parties.
SECTION 9.03. Investor Agent and Affiliates. With respect to any Receivable
Interest or interests therein owned by it, each Investor Agent shall have the
same rights and powers under this Agreement as any Bank and may exercise the
same as though it were not an Investor Agent. Each Investor Agent and any of its
Affiliates may generally engage in any kind of business with the Seller, the
Originator, the Collection Agent or any Obligors, any of their respective
Affiliates and any Person who may do business with or own securities of the
Seller, any other Originator, the Collection Agent or any Obligor or any of
their respective Affiliates, all as if such Investor Agent were not an Investor
Agent and without any duty to account therefor to any Investors or Banks.
SECTION 9.04. Indemnification of Investor Agents. Each Bank in any Group
agrees to indemnify the Investor Agent for such Group (to the extent not
reimbursed by the Seller or the Originator), ratably according to the proportion
of the Percentage of such Bank to the aggregate Percentages of all Banks in such
Group, from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against such Investor Agent in any way relating to or arising out of this
Agreement or any other Transaction Document or any action taken or omitted by
such Investor Agent under this Agreement or any other Transaction Document,
provided that no Bank shall be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from such Investor Agent's gross negligence
or willful misconduct.
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SECTION 9.05. Delegation of Duties. Each Investor Agent may execute any of
its duties through agents or attorneys-in-fact and shall be entitled to advice
of counsel concerning all matters pertaining to such duties. No Investor Agent
shall be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
SECTION 9.06. Action or Inaction by Investor Agent. Each Investor Agent
shall in all cases be fully justified in failing or refusing to take action
under any Transaction Document unless it shall first receive such advice or
concurrence of the Investors and Banks in its Group and assurance of its
indemnification by the Banks in its Group, as it deems appropriate. Each
Investor Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement or any other Transaction Document in
accordance with a request or at the direction of the Investors and Banks in its
Group, and such request or direction and any action taken or failure to act
pursuant thereto shall be binding upon all Investors and Banks in its Group.
SECTION 9.07. Notice of Events of Termination. No Investor Agent shall be
deemed to have knowledge or notice of the occurrence of any Incipient Event of
Termination or of any Event of Termination unless such Investor Agent has
received notice from the Program Agent, any other Investor Agent, any Investor
or Bank, the Collection Agent, the Originator or the Seller stating that an
Incipient Event of Termination or Event of Termination has occurred hereunder
and describing such Incipient Event of Termination or Event of Termination. If
an Investor Agent receives such a notice, it shall promptly give notice thereof
to the Investors and Banks in its Group and to the Program Agent (but only if
such notice received by such Investor Agent was not sent by the Program Agent).
The Investor Agent shall take such action concerning an Incipient Event of
Termination or an Event of Termination as may be directed by the Investors and
Banks in its Group (subject to the other provisions of this Article IX), but
until such Investor Agent receives such directions, such Investor Agent may (but
shall not be obligated to) take such action, or refrain from taking such action,
as such Investor Agent deems advisable and in the best interests of the
Investors and Banks in its Group.
SECTION 9.08. Non-Reliance on Investor Agent and Other Parties. Except to
the extent otherwise agreed to in writing between an Investor and its Investor
Agent, each Investor and Bank in the same Group expressly acknowledges that
neither the Investor Agent for its Group, any of its Affiliates nor any of such
Investor Agent's or Affiliate's directors, officers, agents or employees has
made any representations or warranties to it and that no act by such Investor
Agent hereafter taken, including any review of the affairs of the Seller, the
Collection Agent or the Originator, shall be deemed to constitute any
representation or warranty by such Investor Agent. Except to the extent
otherwise agreed to in writing between an Investor and its Investor Agent, each
Investor and Bank in the same Group represents and warrants to the Investor
Agent for such Group that, independently and without reliance upon such Investor
Agent, any of its Affiliates, any other Investor Agent, the Program Agent or any
other Investor or Bank and based on such documents and information as it has
deemed appropriate, it has made and will continue to make its own appraisal of
and investigation into the business, operations, property, prospects, financial
and other conditions and creditworthiness of the Seller, the Originator and the
Receivable Interests and its own decision to enter into this Agreement and to
take, or omit, action under this Agreement or any other Transaction Document.
Except for items expressly required to be delivered under this Agreement or any
other Transaction Document by
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an Investor Agent to any Investor or Bank in its Group, no Investor Agent shall
have any duty or responsibility to provide any Investor or Bank in its Group
with any information concerning the Seller, the Originator or any of their
Affiliates that comes into the possession of such Investor Agent or any of its
directors, officers, agents, employees, attorneys-in-fact or Affiliates.
SECTION 9.09. Successor Investor Agent. Any Investor Agent may, upon at
least thirty (30) days' notice to the Program Agent, the Seller and the
Investors and Banks in its Group, resign as Investor Agent for its Group. Such
resignation shall not become effective until a successor investor agent is
appointed by the Investors and Banks in such Group and has accepted such
appointment. Upon such acceptance of its appointment as Investor Agent for such
Group hereunder by a successor Investor Agent, such successor Investor Agent
shall succeed to and become vested with all the rights and duties of the
retiring Investor Agent, and the retiring Investor Agent shall be discharged
from its duties and obligations under the Transaction Documents. After any
retiring Investor Agent's resignation hereunder, the provisions of this Article
IX and Section 6.07 and Article X shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was an Investor Agent.
SECTION 9.10. Reliance on Investor Agent. Unless otherwise advised in
writing by an Investor Agent or by any Investor or Bank in such Investor Agent's
Group, each party to this Agreement may assume that (i) such Investor Agent is
acting for the benefit and on behalf of each of the Investors and Banks in its
Group, as well as for the benefit of each assignee or other transferee from any
such Person, and (ii) each action taken by such Investor Agent has been duly
authorized and approved by all necessary action on the part of the Investors and
Banks in its Group.
ARTICLE X
INDEMNIFICATION
SECTION 10.01. Indemnities by the Seller. Without limiting any other rights
that the Program Agent, the Investor Agents, the Investors, the Banks or any of
their respective Affiliates (each, an "Indemnified Party") may have hereunder or
under applicable law, the Seller hereby agrees to indemnify each Indemnified
Party from and against any and all claims, losses and liabilities (including
reasonable attorneys' fees) (all of the foregoing being collectively referred to
as "Indemnified Amounts") arising out of or resulting from this Agreement or the
other Transaction Documents or the use of proceeds of purchases or reinvestments
or the ownership of Receivable Interests or in respect of any Receivable or any
Contract, excluding, however, (a) Indemnified Amounts to the extent found by a
court of competent jurisdiction to have resulted from gross negligence or
willful misconduct on the part of such Indemnified Party, (b) recourse (except
as otherwise specifically provided in this Agreement) for uncollectible
Receivables or (c) any income taxes incurred by such Indemnified Party arising
out of or as a result of this Agreement or the ownership of Receivable Interests
or in respect of any Receivable or any Contract. Without limiting or being
limited by the foregoing, the Seller shall pay on demand to each Indemnified
Party any and all amounts necessary to indemnify such Indemnified Party from and
against any and all Indemnified Amounts relating to or resulting from any of the
following:
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(i) the characterization in any Seller Report or other written statement
made by or on behalf of the Seller of any Receivable as an Eligible Receivable
or as included in the Net Receivables Pool Balance which, as of the date of such
Seller Report or other statement, is not an Eligible Receivable or should not be
included in the Net Receivables Pool Balance;
(ii) any representation or warranty or statement made or deemed made by the
Seller (or any of its officers) under or in connection with this Agreement or
any of the other Transaction Documents which shall have been incorrect in any
material respect when made;
(iii) the failure by the Seller or the Originator to comply with any
applicable law, rule or regulation with respect to any Pool Receivable or the
related Contract; or the failure of any Pool Receivable or the related Contract
to conform to any such applicable law, rule or regulation;
(iv) the failure to vest in the Investors or the Banks, as the case may be,
(a) a perfected undivided percentage ownership interest, to the extent of each
Receivable Interest, in the Receivables in, or purporting to be in, the
Receivables Pool and the Related Security and Collections in respect thereof, or
(b) a perfected security interest as provided in Section 2.11, in each case free
and clear of any Adverse Claim;
(v) the failure to have filed, or any delay in filing, financing statements
or other similar instruments or documents under the UCC of any applicable
jurisdiction or other applicable laws with respect to any Receivables in, or
purporting to be in, the Receivables Pool and the Related Security and
Collections in respect thereof, whether at the time of any purchase or
reinvestment or at any subsequent time;
(vi) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable in,
or purporting to be in, the Receivables Pool (including, without limitation, a
defense based on such Receivable or the related Contract not being a legal,
valid and binding obligation of such Obligor enforceable against it in
accordance with its terms), or any other claim resulting from the sale of the
merchandise or services related to such Receivable or the furnishing or failure
to furnish such merchandise or services or relating to collection activities
with respect to such Receivable (if such collection activities were performed by
the Seller or any of its Affiliates acting as Collection Agent);
(vii) any failure of the Seller to perform its duties or obligations in
accordance with the provisions hereof or to perform its duties or obligations
under the Contracts;
(viii) any products liability or other claim arising out of or in
connection with merchandise, insurance or services which are the subject of any
Contract;
(ix) the commingling of Collections of Pool Receivables at any time with
other funds;
(x) any third party investigation, litigation or proceeding related to this
Agreement or the use of proceeds of purchases or reinvestments or the ownership
of Receivable Interests or in respect of any Receivable or Related Security or
Contract (excluding any
70
collection costs of the Program Agent, the Investor Agents, the Investors or the
Banks arising directly from the financial inability of an Obligor to pay in
respect of any Receivable);
(xi) any failure of the Seller to comply with its covenants contained in
this Agreement or any other Transaction Document;
(xii) any claim brought by any Person other than an Indemnified Party
arising from any activity by the Seller or any Affiliate of the Seller in
servicing, administering or collecting any Receivable; or
(xiii) the failure of the Seller or the Originator to comply with any term
or provision of any Contract that contains a confidentiality provision that
purports to restrict the ability of the Program Agent, the Investor Agents, the
Investors or the Banks to exercise their rights under this Agreement, including,
without limitation, their right to review the Contract.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Amendments, Etc. No amendment or waiver of any provision of
this Agreement or consent to any departure by the Seller therefrom shall be
effective unless in a writing signed by each Investor Agent and the Program
Agent (and, in the case of any amendment, also signed by the Seller), and then
such amendment, waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given; provided, however, that
no amendment, waiver or consent shall, unless in writing and signed by the
Collection Agent in addition to each Investor Agent and the Program Agent,
affect the rights or duties of the Collection Agent under this Agreement. No
failure on the part of the Investors, the Banks, the Investor Agents or the
Program Agent to exercise, and no delay in exercising, any power, right or
remedy hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any such power, right or remedy hereunder preclude any other
or further exercise thereof or the exercise of any other power, right or remedy.
The rights and remedies herein provided shall be cumulative and nonexclusive of
any rights or remedies provided by law. Any waiver of this Agreement shall be
effective only in the specific instance and for the specific purpose for which
given.
SECTION 11.02. Notices, Etc. All notices and other communications hereunder
shall, unless otherwise stated herein, be in writing (which shall include
facsimile communication) and faxed or delivered, to each party hereto, at its
address set forth under its name on the signature pages hereof or at such other
address as shall be designated by such party in a written notice to the other
parties hereto. Notices and communications by facsimile shall be effective when
sent (and shall be followed by hard copy sent by regular mail), and notices and
communications sent by other means shall be effective when received.
SECTION 11.03. Assignability. (a) This Agreement and the Investors' rights
and obligations herein (including ownership of each Receivable Interest) shall
be assignable by the Investors and their successors and assigns (prior to an
Event of Termination or Incipient Event of Termination, with the prior written
consent of the Seller, such consent not to be unreasonably withheld or delayed;
provided that assignments to any Investor Agent, the
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Program Agent or an Affiliate of such Agents or to a receivables securitization
company administered by any Investor Agent, the Program Agent or an Affiliate of
such Agents shall not require such consent). Each assignor of a Receivable
Interest or any interest therein shall notify the Program Agent, its Investor
Agent and the Seller of any such assignment. Each assignor of a Receivable
Interest or any interest therein may, in connection with any such assignment or
participation, disclose to the assignee or participant any information relating
to the Seller or the Originator, including the Receivables, furnished to such
assignor by or on behalf of the Seller or by the Program Agent; provided that,
prior to any such disclosure, the assignee or participant agrees to preserve the
confidentiality of any confidential information relating to the Seller or the
Originator received by it from any of the foregoing entities.
(b) Each Bank may assign to any Eligible Assignee or to any other Bank all
or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Bank Commitment and any Receivable
Interests or interests therein owned by it) (prior to an Event of Termination or
Incipient Event of Termination, with the prior written consent of the Seller,
such consent not to be unreasonably withheld or delayed; provided that
assignments to any Investor Agent, the Program Agent or an Affiliate of such
Agents shall not require such consent). The parties to each such assignment
shall execute and deliver to the Program Agent (with a copy to the assignor's
Investor Agent) an Assignment and Acceptance. In addition, any Bank may assign
any of its rights (including, without limitation, rights to payment of Capital
and Yield) under this Agreement to any Federal Reserve Bank without notice to or
consent of the Seller or the Program Agent.
(c) This Agreement and the rights and obligations of the Agents herein
shall be assignable by the Agents and their successors and assigns.
(d) The Seller may not assign its rights or obligations hereunder or any
interest herein without the prior written consent of the Program Agent or any
Investor Agent.
SECTION 11.04. Costs, Expenses and Taxes. (a) In addition to the rights of
indemnification granted under Section 10.01 hereof, the Seller agrees to pay on
demand all costs and expenses in connection with the preparation, execution,
delivery and administration (including periodic auditing and the other
activities contemplated in Section 5.02) of this Agreement, any Asset Purchase
Agreement and the other documents and agreements to be delivered hereunder,
including, without limitation, the reasonable fees and out-of-pocket expenses of
counsel for the Program Agent, each Investor Agent, each Investor, each Bank and
their respective Affiliates with respect thereto and with respect to advising
the Program Agent, each Investor Agent, each Investor, each Bank and their
respective Affiliates as to their rights and remedies under this Agreement, and
all costs and expenses, if any (including reasonable counsel fees and expenses),
of the Program Agent, each Investor Agent, each Investor, each Bank and their
respective Affiliates, in connection with the enforcement of this Agreement and
the other documents and agreements to be delivered hereunder.
(b) In addition, the Seller shall pay (i) to the extent not included in the
calculation of Yield, any and all commissions of placement agents and dealers in
respect of commercial paper notes issued to fund the purchase or maintenance of
any Receivable Interest, and (ii) any and all costs and expenses of any issuing
and paying agent or other Person
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responsible for the administration of any Investor's commercial paper program in
connection with the preparation, completion, issuance, delivery or payment of
commercial paper notes issued to fund the purchase or maintenance of any
Receivable Interest.
(c) The Seller also shall pay on demand all other costs, expenses and taxes
(excluding the cost of auditing ▇▇▇▇▇▇'▇ and Gotham's books by certified public
accountants, the cost of rating ▇▇▇▇▇▇'▇ and Gotham's commercial paper by
independent financial rating agencies and income taxes) incurred by ▇▇▇▇▇▇,
Gotham or any partner or stockholder of ▇▇▇▇▇▇ and Gotham ("Other Costs"),
including the taxes (excluding income taxes) resulting from ▇▇▇▇▇▇'▇ operations,
and the reasonable fees and out-of-pocket expenses of counsel for any director,
officer or member of ▇▇▇▇▇▇ or Gotham with respect to advising as to rights and
remedies under this Agreement, the enforcement of this Agreement or advising as
to matters relating to ▇▇▇▇▇▇'▇ and Gotham's operations; provided that the
Seller and any other Persons who from time to time sell receivables or interests
therein to ▇▇▇▇▇▇ or Gotham ("Other Sellers") each shall be liable for such
Other Costs ratably in accordance with the usage under their respective
facilities; and provided further that if such Other Costs are attributable to
the Seller and not attributable to any Other Seller, the Seller shall be solely
liable for such Other Costs.
SECTION 11.05. No Proceedings. Each of the Seller, the Program Agent, each
Investor Agent, the Collection Agent, each Investor, each Bank, each assignee of
a Receivable Interest or any interest therein and each entity which enters into
a commitment to purchase Receivable Interests or interests therein hereby agrees
that it will not institute against, or join any other Person in instituting
against, any Investor any proceeding of the type referred to in Section 7.01(g)
so long as any commercial paper or other senior indebtedness issued by such
Investor shall be outstanding or there shall not have elapsed one year plus one
day since the last day on which any such commercial paper or other senior
indebtedness shall have been outstanding.
SECTION 11.06. Confidentiality. (a) The Seller, the Originator and the
Collection Agent each agrees to maintain the confidentiality of this Agreement
in communications with third parties and otherwise; provided that this Agreement
may be disclosed (i) to third parties to the extent such disclosure is made
pursuant to a written agreement of confidentiality in form and substance
reasonably satisfactory to the Agents, (ii) to the legal counsel and auditors of
the Seller and the Collection Agent if they agree to hold it confidential and
(iii) to the extent required by applicable law or regulation or by any court,
regulatory body or agency having jurisdiction over such party; and provided,
further, that such party shall have no obligation of confidentiality in respect
of any information which may be generally available to the public or becomes
available to the public through no fault of such party.
(b) Each Investor, each Bank, each Investor Agent and the Program Agent
agrees to maintain the confidentiality of all information with respect to the
Seller, the Originator or the Receivables Pool (including the Seller Reports)
furnished or delivered to it pursuant to this Agreement; provided, that such
information may be disclosed (i) to such party's legal counsel, bank examiners
and auditors and to such party's assignees and participants and potential
assignees and participants and their respective counsel if they agree to hold it
confidential, (ii) to the rating agencies and the providers of credit
enhancement or liquidity for each Investor, and
73
(iii) to the extent required by applicable law or regulation or by any court,
regulatory body or agency having jurisdiction over such party; and provided,
further, that such party shall have no obligation of confidentiality in respect
of any information which may be generally available to the public or becomes
available to the public through no fault of such party.
(c) Notwithstanding any other provision herein, each party hereto (and each
employee, representative or other agent of each party hereto) may disclose to
any and all Persons, without limitation of any kind, the U.S. tax treatment and
U.S. tax structure of the transaction contemplated by this Agreement and the
other Transaction Documents and all materials of any kind (including opinions or
other tax analyses) that are provided to such party relating to such U.S. tax
treatment and U.S. tax structure, other than any information for which
nondisclosure is reasonably necessary in order to comply with applicable
securities laws. The preceding sentence is intended to cause this Agreement to
be treated as not having been offered under conditions of confidentiality for
purposes of Section 1.6011-4(b)(3) (or any successor provision) of the U.S.
Treasury Regulations promulgated under Section 6011 of the Internal Revenue Code
of 1986, as amended, and shall be construed in a manner consistent with such
purpose.
SECTION 11.07. GOVERNING LAW. THIS AGREEMENT SHALL, IN ACCORDANCE WITH
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK
WITHOUT REGARD TO ANY CONFLICT OF LAWS PRINCIPLES THEREOF THAT WOULD CALL FOR
THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE EXTENT
THAT, PURSUANT TO THE UCC OF THE STATE OF NEW YORK, THE PERFECTION AND THE
EFFECT OF PERFECTION OR NON-PERFECTION OF THE INTERESTS OF THE INVESTORS AND THE
BANKS IN THE RECEIVABLES AND THE ORIGINATOR PURCHASE AGREEMENT ARE GOVERNED BY
THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
SECTION 11.08. Execution in Counterparts. This Agreement may be executed in
any number of 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 11.09. Survival of Termination. The provisions of Sections 2.08,
2.09, 6.07, 10.01, 11.04, 11.05 and 11.06 shall survive any termination of this
Agreement.
SECTION 11.10. Consent to Jurisdiction. (a) Each party hereto hereby
irrevocably submits to the non-exclusive jurisdiction of any New York State or
Federal court sitting in New York City in any action or proceeding arising out
of or relating to this Agreement or the other Transaction Documents, and each
party hereto hereby irrevocably agrees that all claims in respect of such action
or proceeding may be heard and determined in such New York State court or, to
the extent permitted by law, in such Federal court. The parties hereto hereby
irrevocably waive, to the fullest extent they may effectively do so, the defense
of an inconvenient forum to the maintenance of such action or proceeding. The
parties hereto agree that a final
74
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.
(b) Each of the Seller, the Collection Agent and the
Originator consents to the service of any and all process in any such action or
proceeding by the mailing of copies of such process to it at its address
specified in Section 11.02. Nothing in this Section 11.10 shall affect the right
of the Investors, any Bank or any Agent to serve legal process in any other
manner permitted by law.
SECTION 11.11. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO
THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN
TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED
WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED OR DELIVERED PURSUANT HERETO.
[Remainder of this page intentionally left blank.]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.
SELLER: LEXMARK RECEIVABLES CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Assistant Treasurer
▇▇▇▇ ▇-▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
INVESTOR: ▇▇▇▇▇▇, LLC
By: Citicorp North America,
Inc., as Attorney-in-Fact
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Vice President
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: Global Securitization
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
PROGRAM AGENT
AND INVESTOR AGENT: CITICORP NORTH AMERICA, INC.,
as Program Agent and as an Investor Agent
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Vice President
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: Global Securitization
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
BANK: CITIBANK, N.A.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Attorney-in-Fact
Percentage Interest: 50%
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
76
Harrison, N.Y. 10528
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
INVESTOR: GOTHAM FUNDING CORPORATION
By: /s/ R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------------
Title: Treasurer
▇/▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇▇▇▇, ▇▇▇.,
▇▇▇ ▇▇▇▇ Branch
1251 Avenue of the Americas
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Securitization Group
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
INVESTOR AGENT: THE BANK OF TOKYO-MITSUBISHI, LTD.,
NEW YORK BRANCH
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------
Name: A.K. Reddy
Title: Vice President
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Securitization Group
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
77
BANK: THE BANK OF TOKYO-MITSUBISHI, LTD.,
NEW YORK BRANCH
By: /s/ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Authorized signatory
Percentage Interest: 50%
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: US Corporate Banking
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
ORIGINATOR
AND COLLECTION
AGENT: LEXMARK INTERNATIONAL, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: V.P. & Treasurer
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
Building 1, Dept. 857
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No. ▇▇▇-▇▇▇-▇▇▇▇
Telephone No. ▇▇▇-▇▇▇-▇▇▇▇
78
ANNEX E
[Form of Funds Transfer Letter]
[Letterhead of the Lexmark Receivables Corporation]
[Date]
Citicorp North America, Inc.,
as Program Agent
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Funds Transfers
Gentlemen:
This letter is the Funds Transfer Letter referred to in Section 2.02(b) of
the Amended and Restated Receivables Purchase Agreement, dated as of October 8,
2004, as modified, amended or restated from time to time (the "RPA"; terms used
in the RPA, unless otherwise defined herein, having the meaning set forth
therein) among the undersigned, the Investors, the Banks, the Investor Agents,
you, as Program Agent for the Investors and the Banks and Lexmark International,
Inc.
You are hereby directed to deposit all funds representing amounts paid for
Receivable Interests (other than certain funds paid with respect to the initial
purchase of Receivables Interests under the RPA, as set forth in a Funding and
Payment Direction Agreement) to Account No. 990117772, at Bank of America, N.A.,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ABA No. ▇▇▇▇▇▇▇▇▇.
The provisions of this Letter may not be changed or amended orally, but
only by a writing in substantially the form of this letter signed by the
undersigned and acknowledged by you.
Very truly yours,
LEXMARK RECEIVABLES CORPORATION
By:
---------------------------
Title:
Receipt acknowledged:
CITICORP NORTH AMERICA, INC.,
as Program Agent
By:
---------------------------------------------
Vice President
79