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Exhibit 10.11
EXECUTION COPY
RECEIVABLES PURCHASE AND CONTRIBUTION AGREEMENT
by and between
MEDCO HEALTH SOLUTIONS, INC.
as Originator and Servicer
and
MEDCO HEALTH RECEIVABLES, LLC
as Buyer
Dated as of August 8, 2003
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TABLE OF CONTENT
Page
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ARTICLE I.
DEFINITIONS......................................................1
SECTION 1.01.
Certain Defined Terms.......................................1
SECTION 1.02.
Other Terms.................................................5
SECTION 1.03.
Incorporation of Defined Terms..............................5
ARTICLE II. AMOUNTS AND TERMS OF
PURCHASES AND CONTRIBUTIONS.................5
SECTION 2.01.
Facility....................................................5
SECTION 2.02.
Making Purchases............................................5
SECTION 2.03.
Collections.................................................6
SECTION 2.04.
Settlement Procedures.......................................7
SECTION 2.05.
Payments and Computations, Etc..............................8
SECTION 2.06.
Contributions...............................................8
SECTION 2.07.
Intent of the Originator and the Buyer......................8
SECTION 2.08.
Grant of Security Interest..................................8
ARTICLE III. CONDITIONS OF
PURCHASES..........................................9
SECTION 3.01.
Conditions Precedent to Initial Purchase from the
Originator..................................................9
SECTION 3.02.
Conditions Precedent to All Purchases.......................9
ARTICLE IV. REPRESENTATIONS AND
WARRANTIES..................................10
SECTION 4.01.
Representations and Warranties of the Originator...........10
ARTICLE V.
COVENANTS.......................................................14
SECTION 5.01.
Covenants of the Originator................................14
ARTICLE VI. ADMINISTRATION AND
COLLECTION...................................19
SECTION 6.01.
Designation of Servicer....................................19
SECTION 6.02.
Certain Rights of the Buyer................................20
SECTION 6.03.
Rights and Remedies........................................20
SECTION 6.04.
Transfer of Records to Buyer...............................21
ARTICLE VII. TERMINATION
EVENTS..............................................22
SECTION 7.01.
Termination Events.........................................22
ARTICLE VIII.
INDEMNIFICATION.................................................23
SECTION 8.01.
Indemnities by the Originator..............................23
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ARTICLE IX.
MISCELLANEOUS...................................................25
SECTION 9.01.
Amendments, Etc............................................25
SECTION 9.02.
Notices, Etc...............................................25
SECTION 9.03.
Binding Effect; Assignability..............................26
SECTION 9.04.
Costs, Expenses and Taxes..................................26
SECTION 9.05. No
Proceedings.............................................27
SECTION 9.06.
GOVERNING LAW..............................................27
SECTION 9.07.
Third Party Beneficiary....................................27
SECTION 9.08.
Restriction on Payments....................................27
SECTION 9.09.
Execution in Counterparts..................................28
SECTION 9.10.
Integration; Survival of Termination.......................28
SECTION 9.11.
Consent to Jurisdiction....................................29
SECTION 9.12.
WAIVER OF JURY TRIAL.......................................29
EXHIBITS
EXHIBIT A Deposit Accounts and Deposit
Account Banks
EXHIBIT B Form of Subordinated Note
EXHIBIT C Trade Names and Former Names
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RECEIVABLES PURCHASE AND CONTRIBUTION AGREEMENT
Dated as of August 8, 2003
MEDCO HEALTH SOLUTIONS, INC., a Delaware corporation, in its
capacity
as originator of the Receivables (the
"Originator") and as servicer of the
Receivables (the "Servicer"), and MEDCO
HEALTH RECEIVABLES, LLC, a Delaware
limited liability company (the "Buyer"),
agree as follows:
PRELIMINARY STATEMENTS. (1) Certain terms which are capitalized
and
used throughout this Agreement (in addition
to those defined above) are defined
in Article I of this Agreement or, if not
defined therein, in the Receivables
Purchase Agreement referred to below.
(2) The Originator has
Receivables that it wishes to sell to the
Buyer from time to time, and the Buyer has agreed to
purchase such Receivables
on the terms set forth herein.
(3) The Originator may
also wish to contribute Receivables to the
capital of the Buyer from time to time on
the terms set forth herein.
NOW, THEREFORE, the parties agree as follows:
ARTICLE I. DEFINITIONS
SECTION 1.01. Certain Defined Terms. 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):
"Additional Discount Percentage" means, on any date, the
percentage
obtained from the following formula:
ADP = (ER + AEM + PFR + SFR + 2.00%) x (PTR x 30/360)
where:
ADP = the Additional Discount
Percentage
ER = the one-month Eurodollar Rate as
of the end of the Current
Calculation Period
AEM = the Applicable Eurodollar Rate
Margin as of the end of the
Current Calculation Period
PFR = the Program Fee Rate (as defined
in the Purchaser Fee
Letter) as of the end of the Current Calculation Period
SRF = the Servicing Fee Rate
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PTR = Portfolio Turnover Rate as of the
end of the Current
Calculation Period
"Agreement" means this Receivables Purchase and Contribution
Agreement, as
the same may be amended, restated, supplemented or otherwise
modified from
time to time.
"Closing Date" means August 8, 2003 or, if later, the first date
on
which the
conditions precedent set forth in Section 3.01 are satisfied.
"Contract" means an agreement pursuant to or under which a
pharmaceutical
manufacturer shall be obligated to pay rebates,
administrative
fees, data fees or other fees to the Originator, in each
case as such
agreement may be amended, restated, supplemented, renewed or
otherwise
modified from time to time and any replacement or substitute
agreement;
provided that the term "Contract" shall not include any
agreement with
Merck or any of its Affiliates so long as no payments under
such agreement
are remitted to a Deposit Account.
"Contributed Receivable" has the meaning specified in Section
2.06.
"Deemed Collection" has the meaning specified in Section
2.04(a).
"Deposit Date" means each day on which any Collections are
deposited
in a Deposit
Account or on which any Transaction Party shall receive
Collections.
"Discount" means, in respect of each Purchase, the Discount
Percentage
multiplied by
the Outstanding Balance of the Receivables that are the
subject of such
Purchase.
"Discount Percentage" means, on any date, the percentage obtained
from
the following
formula:
(LR + ADP)
all determined
by the Originator as of the most recent Monthly Reporting
Date,
Where
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LR = the average Loss-to-Liquidation
Ratio for the three Calculation
Periods immediately prior to such Monthly Reporting Date.
ADP = the Additional Discount Percentage
(which reflects the cost of the
Buyer's cost of funds, overhead, including costs of processing
the
purchase of Receivables and other normal operation costs, and a
reasonable profit margin).
None of the
elements of the above-referenced formula, in respect of any
purchase of
Receivables, will be adjusted following the related Purchase
Date.
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With respect to each calculation set forth above with respect to
a
Monthly
Reporting Date, such calculation as calculated on such Monthly
Reporting Date
and included in the applicable Monthly Report shall remain
in effect from
and including the related Monthly Reporting Date to but
excluding the
following Monthly Reporting Date.
Notwithstanding the foregoing, for the initial period from and
including the
Closing Date to but excluding the first Monthly Reporting
Date, the
Discount Percentage will be 3.17645%.
"Incipient Termination Event" means an event that but for notice
or
lapse of time or
both would constitute a Termination Event.
"Indemnified Amounts" has the meaning specified in Section
8.01.
"Indemnified Parties" has the meaning specified in Section
8.01.
"Initial Subordinated Note Amount" has the meaning specified in
Section
2.02(d).
"Material
Adverse Effect" means a material adverse effect on (i) the
ability of any
Transaction Party to perform its obligations under any
Transaction
Document, subject to applicable cure and grace periods, (ii)
the legality,
validity or enforceability of this Agreement or any other
Transaction
Document, (iii) the Buyer's interest in the Receivables
generally or in
any material portion of the Receivables, the Related
Security or the
Collections with respect thereto, (iv) the collectibility
of the
Receivables generally or of any material portion of the
Receivables
or the legality,
validity or enforceability of the Contracts generally or
of any material
portion of the Contracts or (v) the business, operations,
properties, assets,
liabilities or condition (financial or otherwise) of
the Originator
and its Subsidiaries, taken as a whole.
"Purchase" means a purchase by, or contribution to, the Buyer
of
Receivables from
the Originator pursuant to Article II.
"Purchase Date" means each day on which a Purchase is made pursuant
to
Article II.
"Purchased Receivable" means any Receivable which is purchased by
the
Buyer pursuant
to Section 2.02.
"Purchase Price" for any Purchase means an amount equal (a) to
the
Outstanding
Balance of the Receivables that are the subject of such
Purchase as set
forth in the Receivables Trial Balance, minus (b) the
Discount for
such Purchase minus (c) the amount of any Purchase Price
Credits to be
credited against the Purchase Price pursuant to Section 2.04.
"Purchase Price Credit" has the meaning specified in Section
2.04(c).
"Receivables" means all indebtedness and other obligations (in
each
case whether
present or future, due or to become due, billed or unbilled)
of any Obligor
arising under
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or pursuant to a
Contract, including, without limitation, the right to
payment of any
rebates, administrative fees, data fees, interest or finance
charges, late
payment charges, delinquency charges, extension or collection
fees and all
other obligations of such Obligor with respect thereto.
"Receivables Purchase Agreement" means that certain Receivables
Purchase
Agreement, dated as of the date hereof, among the Buyer; the
Originator, as
Servicer; the Conduit Purchasers from time to time parties
thereto; the
Committed Purchasers from time to time parties thereto; the
Managing Agents
from time to time parties thereto; and Citicorp North
America, Inc.,
as Administrative Agent, as amended, restated, supplemented
or otherwise
modified from time to time.
"Receivables Trial Balance" of the Originator on any date means
the
Originator's
accounts receivable trial balance (whether in the form of a
computer
printout, magnetic tape or diskette or other electronic or
paper
record) on such
date, listing Obligors and the Receivables respectively
owed by such
Obligors on such date together with the aged Outstanding
Balances of such
Receivables, in form and substance satisfactory to the
Buyer.
"Related Security" means with respect to any Receivable:
(i) 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
and
financing statement amendments authorized by an Obligor describing
any
collateral securing such Receivable;
(ii) 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;
(iii) 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;
(iv) all of the
Originator's right, title and interest in and to
all Contracts or other agreements or documents that evidence,
secure
or otherwise relate to such Receivable; and
(v) all
Proceeds, products and profits of the foregoing.
"Repurchase Price" has the meaning specified in Section
2.04(b).
"Settlement Date" means (i) the 15/th/ day of each calendar month
(or,
if such day is
not a Business Day, the next succeeding Business Day) and
(ii) following
the
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Termination
Date, each other "Settlement Date" under and as defined in the
Receivables
Purchase Agreement.
"Subordinated Note" has the meaning specified in Section
2.02(d).
"Termination Event" has the meaning specified in Section 7.01.
"Transaction Party" means either of the Originator or (so long as
it
is the
Originator or an Affiliate thereof other than the Buyer) the
Servicer.
"Transferred Receivable" means a Purchased Receivable or a
Contributed
Receivable.
SECTION 1.02. Other Terms. All accounting terms not
specifically
defined herein shall be construed in
accordance with GAAP. All terms used in
Article 9 of the UCC in the State of New
York, as in effect on the date hereof
and not specifically defined herein, are
used herein as defined in such Article
9. Unless otherwise expressly indicated,
all references herein to "Article,"
"Section," "Schedule" or "Exhibit" means
articles and sections of, and schedules
and exhibits to, this Agreement. Headings
are for purposes of reference only and
shall not otherwise affect the meaning or
interpretation of any provision
hereof. Any reference to any Law shall be
deemed to be a reference to such Law
as the same may be amended or re-enacted
from time to time. Any reference to any
Person appearing in any of the Transaction
Documents shall include its
successors and permitted assigns.
SECTION 1.03. Incorporation of Defined Terms. Capitalized terms
used
but not otherwise defined herein shall have
the meanings ascribed to such terms
in the Receivables Purchase Agreement.
ARTICLE II. AMOUNTS AND TERMS OF PURCHASES AND CONTRIBUTIONS
SECTION 2.01. Facility. On the terms and conditions hereinafter
set
forth and without recourse to the
Originator (except to the extent specifically
provided herein), the Originator hereby
agrees to sell to the Buyer all
Receivables originated by it from time to
time and the Buyer hereby agrees to
purchase from the Originator all such
Receivables from time to time, in each
case during the period from the date hereof
to the Termination Date; provided,
however, that the Originator may, at its
option, elect to contribute Receivables
to the Buyer pursuant to Section 2.06 in
lieu of a sale of such Receivables.
SECTION 2.02. Making Purchases.
(a) Initial Purchase.
On the Closing Date, the Originator shall (i)
contribute to the capital of the Buyer
Receivables having an aggregate
Outstanding Balance of $100,000,000 and
(ii) sell to the Buyer all other
Receivables outstanding as of the Closing
Date. On the date of such Purchase,
the Buyer shall, upon satisfaction of the
applicable conditions set forth in
Article III, pay the Purchase Price for the
Receivables sold to it in the manner
provided in Section 2.02(c).
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(b) Subsequent
Purchases. On each Business Day following the Closing
Date until the Termination Date, the
Originator shall sell to the Buyer and the
Buyer shall purchase from the Originator
all Receivables originated by the
Originator which have not previously been
sold or contributed to the Buyer
hereunder; provided, however, that the
Originator may, at its option on any
Purchase Date, contribute all or any of
such Receivables to the Buyer pursuant
to Section 2.06, instead of selling such
Receivables to the Buyer pursuant to
this Section 2.02(b). On or before the date
of each such Purchase, the Buyer
shall, upon the Satisfaction of the
applicable conditions set forth in Article
III, pay the Purchase Price for such
Purchase in the manner provided in Section
2.02(c).
(c) Payment of
Purchase Price. The Purchase Price for each Purchase
shall be paid on each Purchase Date
therefor as follows: (i) first, to the
extent the Buyer has available funds
therefor, a deposit in same day funds to
the Originator's account designated by the
Originator and (ii) second, by means
of an addition to the principal amount of
the Subordinated Note in an aggregate
amount equal to the remaining portion of
the Purchase Price; provided that the
Buyer may not pay all or any portion of the
Purchase Price for any Purchase by
means of an increase in the principal
amount of the Subordinated Note if, after
giving effect thereto, the Tangible Net
Worth of the Buyer would be less than 3%
of the aggregate Purchase Price of all
outstanding Pool Receivables at such time
(net of Collections that have been received
on such outstanding Pool
Receivables).
(d) Subordinated Note.
On the Closing Date, the Buyer shall issue to
the Originator a note substantially in the
form of Exhibit B hereto (as amended,
supplemented or otherwise modified from
time to time, the "Subordinated Note").
The initial aggregate principal amount of
the Subordinated Note (the "Initial
Subordinated Note Amount") shall be an
amount equal to the excess of the
Purchase Price of the Receivables sold to
the Buyer on such date pursuant to
Section 2.02(c) over $100,000,000.
Following the Closing Date, the outstanding
principal amount of the Subordinated Note
at any time shall be equal to the
difference between (i) the sum of the
Initial Subordinated Note Amount and each
addition to the principal amount of the
Subordinated Note pursuant to Section
2.02(c) as of such time and (ii) the
aggregate amount of all payments made in
respect of the principal of the
Subordinated Note as of such time. All payments
made in respect of the Subordinated Note
shall be allocated, first, to pay
accrued and unpaid interest thereon and,
second, to pay the outstanding
principal amount thereof.
(e) Ownership of
Receivables and Related Security. On each Purchase
Date, after giving effect to the Purchase
(including any contribution of
Receivables pursuant to Section 2.06) on
such date, the Buyer shall own all
Receivables originated by the Originator on
or prior to such date (including
Receivables which have been previously sold
or contributed to the Buyer
hereunder), together with all Related
Security with respect thereto.
SECTION 2.03. Collections. (a) On each Business Day, the
Servicer
shall apply all Collections released to the
Buyer pursuant to the Receivables
Purchase Agreement (i) first, to pay the
Purchase Price then owing by the Buyer
hereunder on such date, (ii) second, to pay
the reasonable operating expenses of
the Buyer then due and payable, (iii)
third, if such date is a Settlement Date,
to pay the accrued and unpaid interest on
the outstanding principal amount of
the Subordinated Note for the most recently
ended calendar month and (iv)
fourth, to prepay in whole or in part the
principal amount of the Subordinated
Note. The Servicer shall, on
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or before each Settlement Date, deposit
into an account of the Buyer or the
Buyer's assignee all remaining Collections
of Transferred Receivables (if any)
then held by the Servicer (but only to the
extent such Collections have not been
previously applied to purchase new
Receivables hereunder or to make payments
under the Subordinated Note).
(b) In the event that
the Originator believes that collections which
are not Collections of Transferred
Receivables have been deposited into an
account of the Buyer or the Buyer's
assignee, the Originator shall so advise the
Buyer and, on the Business Day following
such identification to the Buyer's
reasonable satisfaction, the Buyer shall
instruct the Servicer to remit such
collections to the Originator.
(c) On each Settlement
Date, the Buyer shall, to the extent
Collections are available for such purpose
under the Receivables Purchase
Agreement and are not required to pay the
Purchase Price for any Receivables
purchased hereunder, pay to the Originator
accrued interest on the Subordinated
Note; provided, however, that each such
payment shall be made solely from
Collections of Transferred Receivables
after all other amounts then due from the
Buyer under the Receivables Purchase
Agreement have been paid in full and all
amounts then required to be set aside by
the Buyer or the Servicer under the
Receivables Purchase Agreement have been so
set aside; provided, further that no
such payment shall be made at any time (i)
when a Termination Event or Incipient
Termination Event shall have occurred and
be continuing or (ii) during the
period between the Termination Date and the
Final Payout Date. On each Business
Day from and after the Final Payout Date,
the Buyer shall apply all Collections
of Transferred Receivables received by it
(and not previously distributed) first
to the payment of accrued interest on the
Subordinated Note, and then to the
reduction of the principal amount of the
Subordinated Note until paid in full.
SECTION 2.04. Settlement Procedures. (a) If on any day any
Transferred
Receivable becomes (in whole or in part) a
Diluted Receivable, the Originator
shall be deemed to have received on such
day a Collection of such Receivable in
the amount of such Diluted Receivable
(each, a "Deemed Collection").
(b) If on any day it
is determined that any of the representations
and warranties set forth in Section 4.01
with respect to any Transferred
Receivable shall not have been true when
made with respect to such Transferred
Receivable, the Originator shall repurchase
such Receivable on such day by
paying to the Buyer an amount equal to the
Outstanding Balance of such
Transferred Receivable (the "Repurchase
Price").
(c) The Originator
shall pay to the Servicer the amount of all Deemed
Collections and the amount of any
Repurchase Price on or before the next
Settlement Date after the date of such
deemed receipt or the date of repurchase,
as applicable; provided, however, that,
prior to the Termination Date, such
Deemed Collections and Repurchase Price may
be paid by way of a credit (each a
"Purchase Price Credit") against the
Purchase Price otherwise payable by the
Buyer hereunder in respect of Receivables
arising on or after such date;
provided, further that if any Purchase
Price Credits remain unused upon the
earlier to occur of (i) the Termination
Date and (ii) the first Settlement Date
to occur after the Calculation Period in
which such Purchase Price Credits
arose, then the Originator shall pay to the
Buyer on such date in cash the
amount of such unused Purchase Price
Credits.
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(d) Except as
otherwise required by law or the relevant Contract, all
Collections from an Obligor of any
Transferred Receivable shall be applied to
the Receivables of such Obligor in the
order of the age of such Receivables,
starting with the oldest such
Receivable.
SECTION 2.05. Payments and Computations, Etc. (a) All amounts to
be
paid or deposited by the Originator or the
Servicer 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 an account or accounts
designated by the Buyer from time to
time.
(b) The Originator
shall, to the extent permitted by law, pay to the
Buyer interest on any amount not paid or
deposited by the Originator (whether as
Servicer or otherwise) 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 hereunder shall be made on the basis
of a year of 365 (or 366, as applicable)
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 2.06. Contributions. The Originator shall on the Closing
Date,
and may from time to time thereafter at its
option, by notice to the Buyer on or
prior to the date of the proposed
contribution, identify Receivables which it
proposes to transfer to the Buyer as a
capital contribution to the Buyer. On the
date of each such contribution and after
giving effect thereto, the Buyer shall
own all right, title and interest in and to
the Receivables so identified and
contributed (collectively, the "Contributed
Receivables") and all Related
Security relating to such Receivables and
all Collections with respect thereto
and other proceeds of such Receivables and
Related Security.
SECTION 2.07. Intent of the Originator and the Buyer. The
Originator
and the Buyer have structured this
Agreement with the intention that each sale
of Receivables hereunder be treated as a
sale of such Receivables by the
Originator to the Buyer for all purposes
and each contribution of Receivables
hereunder shall be treated as an absolute
transfer of such Receivables by the
Originator to the Buyer for all purposes.
The Originator and the Buyer shall
record each sale and contribution as a sale
or capital contribution, as the case
may be, on its books and records, and
reflect each sale and contribution in its
financial statements as a sale or capital
contribution, as the case may be.
SECTION 2.08. Grant of Security Interest. As collateral security
for
the performance by the Originator of all
the terms, covenants and agreements on
the part of the Originator (whether as
Originator, Servicer or otherwise) to be
performed under this Agreement or any other
Transaction Document, including the
punctual payment when due of all amounts
payable by it hereunder and thereunder,
the Originator hereby grants to the Buyer a
security interest in all of the
Originator's right, title and interest (if
any) in and to the following, in each
case whether now owned and existing or
hereafter acquired or arising:
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(a) all Contracts,
whether now owned or existing or hereafter
acquired or
arising, including, without limitation, with respect to each
Contract (i) all
rights of the Originator to receive moneys due or to
become due under
or pursuant to such Contract (whether or not earned by
performance),
(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 such Contract, (iii) all rights of the Originator
to
receive proceeds
of any insurance, indemnity, warranty or guaranty with
respect to such
Contract, (iv) claims of the Originator for damages arising
out of or for
breach of or default under such Contract, and (v) the right
of the
Originator to compel performance and otherwise exercise all
remedies
thereunder;
(b) all Receivables,
(whether arising before, on or after the
Termination
Date), together with all Related Security and Collections with
respect
thereto;
(c) all Deposit
Accounts; and
(d) to the extent not
included in the foregoing, all products,
profits,
collections and Proceeds of any and all of the foregoing.
ARTICLE III. CONDITIONS OF PURCHASES
SECTION 3.01. Conditions Precedent to Initial Purchase from the
Originator. The initial Purchase of
Receivables from the Originator pursuant to
Section 2.02(a) hereunder is subject to the
conditions precedent that the Buyer
shall have received on or before the date
of such Purchase all of the
instruments, documents, agreements and
opinions specified in Section 3.01 of the
Receivables Purchase Agreement, each
(unless otherwise indicated therein) dated
such date, in form and substance
satisfactory to the Buyer.
SECTION 3.02. Conditions Precedent to All Purchases. The
Buyer's
obligation to make any Purchase (including
the initial Purchase pursuant to
Section 2.02(a)) hereunder shall be subject
to the further conditions precedent
that:
(a)
on or prior to the
date of such Purchase, the Servicer shall have
delivered to the
Buyer all Servicer Reports required under the Receivables
Purchase
Agreement, each duly completed and containing information
covering
the most
recently ended reporting period for which information is
required
pursuant to
Section 6.03 of the Receivables Purchase Agreement and
containing such
additional information as may reasonably be requested by
the Buyer;
(b) on the date of
such Purchase the following statements shall be
true (and the
Originator, by accepting the Purchase Price for such
Purchase, shall
be deemed to have represented and warranted that):
(i) The
representations and warranties contained in Section 4.01
are true and correct in all material respects (except that, to
the
extent any such representation or warranty is qualified by
materiality
or Material Adverse Effect, such representation or warranty must
be
true and correct in all respects subject
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only to the materiality or Material Adverse Effect qualification
set
forth therein) on and as of the date of such Purchase as though
made
on and as of such date;
(ii) No event has
occurred and is continuing, or would result
from such Purchase, that constitutes a Termination Event or an
Incipient Termination Event; and
(iii) The "Termination Date" shall not have occurred under (and
as defined in) the Receivables Purchase Agreement; and
(c) the Buyer shall
have received such other approvals, opinions or
documents as the
Buyer may reasonably request.
Notwithstanding the
foregoing, unless otherwise specified by the Buyer
(with the written consent of the
Administrative Agent) in a written notice to
the Originator, each Purchase shall occur
automatically on each day prior to the
Termination Date, with the result that the
title to all Receivables and the
Related Security with respect thereto shall
vest in the Buyer automatically on
the date each such Receivable arises and
without any further action of any kind
by the Buyer or the Originator, whether or
not the conditions precedent to such
Purchase were in fact satisfied on such
date and notwithstanding any delay in
making payment of the Purchase Price for
such Receivables (but without impairing
the Buyer's obligation to pay such Purchase
Price in accordance with the terms
hereof).
ARTICLE IV. REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Originator.
The
Originator represents and warrants as
follows as of the date hereof and as of
the date of each Purchase hereunder:
(a) The Originator is
a corporation duly incorporated, validly
existing and in
good standing 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, unless the
failure to so
qualify would not reasonably be expected to have a Material
Adverse
Effect.
(b) The execution,
delivery and performance by the Originator of the
Transaction
Documents to which it is a party, including the Originator's
sale and
contribution of Receivables hereunder and the Originator's use
of
the proceeds of
Purchases, (i) are within the Originator's corporate
powers, (ii)
have been duly authorized by all necessary corporate action,
(iii) do not
contravene (1) the Originator's certificate of incorporation
or by-laws, (2)
any Law applicable to the Originator, (3) any material
contractual
restriction binding on or affecting the Originator or its
property or (4)
any order, writ, judgment, award, injunction or decree
binding on or
affecting the Originator or its property, except, in the case
of each of
sub-clauses (2) through (4) of this clause (iii), to the extent
that such
contravention would not be reasonably expected to have a
Material
Adverse Effect,
and (iv) do not result in or require the creation of any
Adverse Claim
upon or with respect to any of its properties (except for the
transfer of the
Originator's interest in the Transferred Receivables
pursuant to this
Agreement). Each of
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the Transaction
Documents to which the Originator is named as a party has
been duly
executed and delivered by the Originator.
(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 Originator of this
Agreement or any
other Transaction Documents to which it is a party, except
for the filing
of the financing statements referred to in Section 3.01 of
the Receivables
Purchase Agreement.
(d) Each of the
Transaction Documents to which the Originator is a
party
constitutes the legal, valid and binding obligation of the
Originator
enforceable
against the Originator in accordance with its terms, except as
such
enforceability may be limited by bankruptcy, insolvency,
reorganization
or similar laws affecting the enforcement of creditors'
rights generally
and by principles of equity, regardless of whether such
enforceability
is considered in a proceeding in equity or at law.
(e) Each sale and
contribution of Receivables made pursuant to this
Agreement will
constitute a valid sale, transfer, and assignment of such
Receivables to
the Buyer, enforceable against creditors of, and purchasers
from, the
Originator. The Originator shall have no remaining property
interest in any
Transferred Receivable.
(f) (i) The Originator has heretofore
furnished to the Buyer and the
Purchasers its
consolidated balance sheet and statements of income,
stockholders' equity
and cash flows (x) for the fiscal years ending, and
at, December 29,
2001 and December 28, 2002, and (y) as of and for the
fiscal quarter
and the portion of the fiscal year ended March 29, 2003. The
financial
statements described in clause (x) of this Section 4.01(f) were
reported on by
PricewaterhouseCoopers LLP for such fiscal years ending, and
at, December 29,
2001 and December 28, 2002, and in clause (y) of this
Section 4.01(f)
were certified by the Originator's chief financial officer.
Such financial
statements present fairly, in all material respects, the
financial
position and results of operations and cash flows of the
Originator and
its consolidated Subsidiaries as of such dates and for such
periods in
conformity with GAAP, subject to year-end audit adjustments and
the absence of
footnotes in the case of the statements referred to in
clause (y) above
of this Section 4.01(f). The Originator has heretofore
also furnished
to the Purchasers its unaudited pro forma condensed
consolidated
statement of income, for its fiscal year ended December 28,
2002, and for
its fiscal quarter ended March 29, 2003 and its unaudited pro
forma condensed
consolidated balance sheet at March 29, 2003. Such pro
forma financial
statements comply, in all material respects, with the
requirements of
Article XI of Regulation S-X of the SEC.
(ii) Since December
28, 2002, there has been no change,
occurrence or
development that has had or could reasonably be expected to
have a Material
Adverse Effect.
(g) There are no
actions, suits or proceedings by or before any
Official Body
pending against or, to the knowledge of the Executive
Officers,
threatened against or affecting the Originator or any of its
Subsidiaries
that (i) would reasonably be expected to
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be adversely
determined, and (ii) if so determined either (x) would
reasonably be
expected, individually or in the aggregate, to result in a
Material Adverse
Effect or (y) seek to enjoin, unwind or otherwise
materially and
adversely affect the transactions contemplated by the
Transaction
Documents.
(h) No proceeds of any
Purchase will be used for a purpose that
violates or
would be inconsistent with, Regulation T, U or X promulgated by
the Board of
Governors of the Federal Reserve System from time to time.
(i) No transaction
contemplated hereby requires compliance with any
bulk sales act
or similar law.
(j) Immediately prior
to each Purchase of Receivables hereunder, the
Originator will
be the owner of such Receivables and all Related Security
with respect thereto,
free and clear of any Adverse Claim (other than
Adverse Claims
created hereunder and under the Receivables Purchase
Agreement). The
Buyer has acquired a valid and perfected first priority
ownership
interest in each Transferred Receivable now existing or
hereafter
arising and in
the Related Security and Collections with respect thereto,
in each case
free and clear of any Adverse Claim (other than Adverse Claims
created
hereunder and under the Receivables Purchase Agreement). No
effective
financing statement or other instrument similar in effect, is
filed in any
recording office listing the Originator as debtor, covering
any Receivable,
any interest therein, the Related Security or Collections
except such as
may be filed in favor of the Buyer in accordance with this
Agreement. Prior
to
