RECEIVABLES PURCHASE AGREEMENT

Exhibit 10.1

EXECUTION COPY

RECEIVABLES PURCHASE AGREEMENT

among

JDER LIMITED,

as Seller,

HANNOVER FUNDING COMPANY LLC,

as Purchaser,

NORDDEUTSCHE LANDESBANK GIROZENTRALE,

as Agent,

JOHNSONDIVERSEY UK LIMITED,

as a Servicer,

JOHNSONDIVERSEY FRANCE S.A.S.,

as a Servicer, and

JOHNSONDIVERSEY ESPAÑA S.L.,

as a Servicer

Dated as of September 8, 2009

TABLE OF CONTENTS

 

 

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TABLE OF CONTENTS

(continued)

 

 

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RECEIVABLES PURCHASE AGREEMENT

This RECEIVABLES PURCHASE AGREEMENT (this “ Agreement ”) is entered into as of September 8, 2009 among JDER Limited, a private limited company incorporated under the laws of Ireland, as seller (the “ Seller ”), HANNOVER FUNDING COMPANY LLC, a Delaware limited liability company (the “ Purchaser ”), JOHNSONDIVERSEY UK LIMITED, a private limited liability company organized under the laws of the United Kingdom (“ JDI UK ”), as a servicer, JOHNSONDIVERSEY FRANCE S.A.S., a simplified joint stock company organized under the laws of France (“ JDI France” ), as a servicer, JOHNSONDIVERSEY ESPAÑA S.L., a Sociedad de Responsabilidad Limitada (a simplified joint stock company with limited liability) organized under the laws of Spain (“ JDI Spain ”), as a servicer (JDI UK, JDI France, and JDI Spain, collectively, the “Servicers” and each individually, a “Servicer”) and NORDDEUTSCHE LANDESBANK GIROZENTRALE, a corporation organized under the laws of Germany (“ NORD/LB ”), as agent for the Purchaser (in such capacity, together with its successors and assigns in such capacity, the “ Agent ”).

PRELIMINARY STATEMENTS. Certain terms that are capitalized and used throughout this Agreement are defined in Exhibit I to this Agreement. References to “the Agreement” in the Exhibits hereto refer to this Agreement, as amended, amended and restated, modified or supplemented from time to time.

The Seller desires to sell, transfer and assign an undivided variable percentage interest in a pool of receivables, and the Purchaser desires to acquire such undivided variable percentage interest, as such percentage interest shall be adjusted from time to time based upon, in part, reinvestment payments and additional payments made by the Purchaser to the Seller.

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto hereby agree as follows:

ARTICLE I

AMOUNTS AND TERMS OF THE PURCHASES

Section 1.1 Purchase Facility . (a) On the terms and conditions hereinafter set forth, including the conditions precedent set forth in Exhibit II hereto, the Purchaser hereby agrees to purchase without recourse, except as otherwise set out herein, the Participation from the Seller on the Closing Date and make Payments with regard to the Participation purchased from the Seller from time to time during the period from the date hereof to the Facility Termination Date. Under no circumstances shall the Purchaser be required to make any such Payment if, after giving effect thereto, the aggregate outstanding Investment of the Participation would exceed the Purchase Limit.

(b) The Seller, or its duly authorized designee, may (i) upon at least thirty (30) days prior written notice, terminate the purchase facility provided in this Section 1.1 in whole, provided that on the date of such termination the Seller has sufficient available funds to discharge all of its payment obligations under this Agreement, including, without limitation, payment in full of the Variable Funding Notes or (ii) upon at least three (3) Business Days’ prior written notice, from time to time, irrevocably reduce in part the unused portion of the Purchase Limit; provided that each partial reduction shall not be less than €500,000 or £500,000, as applicable, and integral multiples of €50,000 or £50,000, as applicable, in excess thereof; and provided , further , that unless reduced to zero, the Purchase Limit shall never be reduced below €25,000,000.

Section 1.2 Making Purchases; the Variable Funding Notes . (a) Each Payment by the Purchaser with regard to the Participation hereunder shall be made upon an irrevocable written notice from the Seller, or its duly authorized designee, in the form of Annex A and delivered in the manner prescribed therein to the Agent (which notice must be received by the Agent prior to 12:00 p.m. New York time) on or before the third Business Day prior to the date of such proposed Payment. Each such notice of any such proposed Payment shall specify the desired amount of such Payment ( provided that where such Payment requires the issuance of further Notes by the Purchaser or any Note Issuer, such amount shall not be less than €500,000 or £500,000, as applicable, and integral multiples of €50,000 or £50,000, as applicable, in excess thereof), the currency of such Payment, the date of such Payment and any other information contemplated by Annex A . After giving effect to any such Payment, the portion of the Participation to which such Payment is applied (either the Euro Participation or the Sterling Participation) shall not exceed one hundred percent (100%). The Agent shall select the duration of the initial Yield Period, and each subsequent Yield Period in its discretion; provided that it shall use reasonable efforts, taking into account market conditions, to accommodate the Seller’s preferences; provided , further , that the Yield Period with respect to any Pounds Sterling-denominated Payment shall be thirty (30) days. Notwithstanding anything to the contrary contained in this Section 1.2(a), Payments to be made by the Purchaser in Pounds Sterling shall not occur on any day other than a Tuesday (or the next succeeding Business Day, if such Tuesday is not a Business Day), and only four Portions of Sterling Investment with regard to the Participation may be outstanding at any one time. If a proposed Payment in Pounds Sterling is requested for any day other than a Tuesday, such Payment shall not be made until the following Tuesday (or the next succeeding Business Day, if such Tuesday is not a Business Day). For the avoidance of doubt, the provisions of this Section 1.2(a) do not apply to any reinvestment Payments to be made out of Available Collections pursuant to Section 1.4(b)(i)(F) .

(b) On the date of each such Payment pursuant to Section 1.2(a) , the Purchaser shall, upon satisfaction of the applicable conditions set forth in Exhibit II hereto, make available to the Agent at the Agent’s office at its address set forth on Schedule I hereto, the amount of such Payment (as set forth in each notice delivered in accordance with Section 1.2(a)) in same day funds, and after the Agent’s receipt of such funds, the Agent shall make such funds immediately available to the Seller by depositing such funds into an account designated by the Seller or its authorized designee. The Purchaser’s obligations under this Section 1.2(b) with respect to any Payment shall not be deemed discharged until such Payment has been deposited into the account designated for such Payment by the Seller or its authorized designee pursuant to the preceding sentence.

 

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(c) In consideration of the Payments described above, effective from the Closing Date, the Seller (i) hereby sells and assigns to the Purchaser the Participation, which represents an undivided percentage ownership interest in all of the Seller’s right, title and interest in and all now and hereafter existing or arising Pool Receivables, and all Related Security and Collections with respect thereto, and other proceeds of, such Pool Receivables and Related Security, and (ii) shall, in order to evidence its payment obligations in respect of the Participation, deliver to the Agent for the benefit of the Purchaser (A) a duly executed variable funding note evidencing payment obligations in respect of the Euro Investment (the “Euro Variable Funding Note”) and (B) a duly executed variable funding note evidencing payment obligations in respect of the Sterling Investment (the “Sterling Variable Funding Note,” and, collectively with the Euro Variable Funding Note, the “Variable Funding Notes”), each in substantially the form of Annex B , dated as of the date of this Agreement. The aggregate maximum principal amount of the Variable Funding Notes at any time shall not exceed the Purchase Limit. On and after the Closing Date, the sum of (i) the principal amount of the Euro Investment outstanding under the Euro Variable Funding Note, as reflected on the schedule attached thereto and (ii) the Euro Equivalent of the Sterling Investment outstanding under the Sterling Variable Funding Note, as reflected on the schedule attached thereto, shall not exceed the Purchase Limit. After the Closing Date, the Agent shall, and is hereby authorized to, make a notation on the schedule attached to each Variable Funding Note of the date and the amount of the related Payments and the date and amount of the payment of principal thereon, and prior to any transfer of a Variable Funding Note, the Agent shall endorse the outstanding principal amount of such Variable Funding Note on the schedule attached thereto; provided , however , that failure to make such notation shall not adversely affect the Purchaser’s rights with respect to such Variable Funding Note. Each Variable Funding Note shall bear interest, payable in the currency in which such Variable Funding Note is denominated, on each Settlement Date, in an amount equal to the aggregate Discount due with respect to all Portions of Investment represented by such Variable Funding Note. For the avoidance of doubt, the total amount of interest to be paid under the Variable Funding Notes on each Settlement Date shall equal the total Discount due in respect of all outstanding Portions of Investment as of such Settlement Date. Although the Variable Funding Notes shall be dated the Closing Date, interest in respect thereof (as described in the preceding sentence) shall be payable only for the periods during which amounts are outstanding thereunder. In addition, although the aggregate stated principal amount of the Variable Funding Notes shall be equal to the Purchase Limit, each Variable Funding Note shall be enforceable with respect to the Seller’s obligation to pay the principal thereof only to the extent of the outstanding Investment that is denominated in the applicable currency at the time such enforcement shall be sought.

(d) To secure all of the Seller’s obligations (monetary or otherwise) under the Variable Funding Notes, this Agreement and the other Transaction Documents to which it is a party, whether now or hereafter existing or arising, due or to become due, direct or indirect, absolute or contingent, the Seller hereby grants to the Agent for the benefit of the Purchaser a security interest in all of the

 

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Seller’s right, title and interest (including without limitation any undivided interest of the Seller) in, to and under all of the following, whether now or hereafter owned, existing or arising: (A) all Pool Receivables, (B) all Related Security with respect to each such Pool Receivable, (C) all Collections with respect to each such Pool Receivable, (D) the Originator Accounts and Collection Accounts and all amounts on deposit therein representing proceeds of the Pool Receivables and proceeds of the Related Security with respect thereto, and all certificates and instruments, if any, from time to time evidencing such Originator Accounts and Collection Accounts and such amounts on deposit therein and any such amounts that are invested in Permitted Investments and any securities or other account into which such Permitted Investments, if any, may from time to time be deposited and any other amounts from time to time on deposit in any such account, (E) all other accounts, deposit accounts, chattel paper, documents, fixtures, general intangibles (including payment intangibles), goods, instruments, investment property, letter-of-credit rights, letters of credit, money, and supporting obligations and proceeds from commercial tort claims, (F) all other personal property of any nature or type, (G) any other Transaction Document not referred to in this Section 1.2(d) , and (H) all accessions, products, substitutions, replacements and proceeds of any of the foregoing, cash and non-cash proceeds of any of the foregoing, and all other property and assets (the items described in clauses (A) through (H), the “Secured Assets”). The Purchaser shall have, with respect to the property described in this Section 1.2(d) , and in addition to all the other rights and remedies available to the Purchaser, all the rights and remedies of a secured party under applicable law.

Section 1.3 Participation Computation . The Euro Participation and the Sterling Participation shall be initially computed on the date of the initial purchase hereunder. Thereafter until the Termination Date, the Euro Participation and the Sterling Participation shall each be automatically recomputed (or deemed to be recomputed) on each Business Day other than a Termination Day. From and after the occurrence and during the continuation of any Termination Day, both the Euro Participation and the Sterling Participation shall be deemed to be one hundred percent (100%). The Participation shall become zero when the Investment and Discount thereon shall have been paid in full, all the amounts owed by the Seller hereunder to the Purchaser, the Agent, and any other Indemnified Party or Affected Person are paid in full and each respective Servicer shall have received any accrued Servicing Fee due to it as of such date.

Section 1.4 Settlement Procedures . (a)  Collection . Collection of the Pool Receivables shall be administered by each Servicer in accordance with the terms of the Servicing Agreement and the Administration Agreement. The Administrator (acting in accordance with its obligations under the Administration Agreement) shall provide to each Servicer and the Seller on a timely basis all information needed for such administration, including, among other things, notice of the occurrence of any Termination Day and current computations of the Euro Participation and the Sterling Participation.

 

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(b) Settlement .

(i) If no Termination Event or Termination Day has occurred and is continuing:

(A) Daily Transfers from the Collection Accounts and Originator Accounts . On each Originator Business Day after the Closing Date, all amounts (except for any minimum balance set forth in the applicable Collection Bank Agreement) on deposit in each Originator Account shall be remitted by the Originator (or the related Servicer on its behalf, acting in continued compliance with all of its obligations under the Servicing Agreement) to the relevant Collection Account (established by the Seller pursuant to Section 4.3(b) ) identified on Schedule II hereto. Collections received (or deemed received) in the Collection Accounts on any Originator Business Day shall not be available for distribution pursuant to this Section 1.4(b)(i) , or for any other purpose, until the next succeeding Originator Business Day, and in any case, such Collections shall only be available for distribution in the amount set forth on the relevant Daily Report issued by the Administrator;

(B) Monthly Set Aside . On each Settlement Date, the Seller or its duly authorized designee shall, from Available Collections set aside and maintain in the related Collection Accounts amounts equal to the Monthly Set Aside Amount (as defined below); provided that if, on such Settlement Date, the aggregate amount of Available Collections is insufficient to set aside the Monthly Set Aside Amount in full, or if such Settlement Date is not an Originator Business Day, Available Collections that are subsequently available in the Collection Accounts shall be used by the Seller or its duly authorized designee to set aside the full Monthly Set Aside Amount as soon as possible and in no event later than two (2) Business Days following such Settlement Date. “Monthly Set Aside Amount” means, with respect to any Settlement Date, an amount equal to the sum of (i) an amount equal to the product of (x) Discount that will accrue during the current month in which such Settlement Date occurs for each Portion of Investment (calculated by the Administrator, with notice to the Servicers, as the average Discount accrued on a monthly basis in the preceding two calendar months) and not previously set aside and (y) three (3), (ii) an amount equal to the product of (x) the sum of the Third Party Servicing Fee (if any) and the Administrator Fee that will accrue during the current month in which such Settlement Date occurs (calculated, in each case, by the Administrator, with notice to the Servicers) and not previously set aside and (y) three (3), (iii) an amount equal to the product of (x) the sum of the Utilization Fee and the Commitment Fee that will accrue during the current month in which such Settlement Date occurs (calculated, in each case, by the Administrator, with notice to the Servicers) and not previously set aside and (y) three (3), and (iv) an amount equal to the Audit Fee Reserve; provided that, on the Originator Business Day immediately following the Closing Date, the Seller or its duly authorized designee shall set aside in the Collection Accounts, in advance, an aggregate amount equal to the product of (x) the sum of the Discount, Third Party Servicing Fees (if any), Administrator Fees, Utilization Fees and Commitment Fees accrued on such Business Day immediately following the Closing Date and (y) eighty-three (83);

 

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(C) Monthly Servicing and Administrator Fees . Subject to paragraph (H)  below, if applicable, on each Settlement Date, (i) the Seller or its duly authorized designee shall deposit to the bank account designated by each Third Party Servicer, from that portion of the Monthly Set Aside Amount set aside on the preceding Settlement Date, an amount equal to the accrued Third Party Servicing Fee for such Third Party Servicer, (ii) the Seller or its duly authorized designee shall deposit to the bank account designated by the Administrator, from that portion of the Monthly Set Aside Amount set aside on the preceding Settlement Date, an amount equal to the accrued Administrator Fees under the Administration Agreement, and (iii) the Seller or its duly authorized designee shall deposit to the bank account designated by each Servicer that is not a Third Party Servicer for the relevant Servicer’s account, from Available Collections not otherwise required to be set aside and maintained pursuant to paragraph (B)  above, an amount equal to the accrued Servicing Fees with respect to such Servicer;

(D) Monthly Discount and Fees to Purchaser . Subject to paragraph (H)  below, on each Settlement Date, the Seller or its duly authorized designee shall remit to the Purchaser’s Account (or such other account designated by the Agent), that portion of the Monthly Set Aside Amount set aside on the preceding Settlement Date and relating to accrued Discount, accrued Utilization Fees and accrued Commitment Fees;

(E) Reduction Payments . On any Business Day, in the event that the Seller or its duly authorized designee has timely notified Agent of its request to reduce the entire Investment or any Portion of Investment pursuant to Section 1.4(f) , the Seller or its duly authorized designee shall deposit into the Purchaser’s Account (or such other account designated by Agent) Available Collections held on deposit in the Collection Accounts pursuant to Section 1.4(f) with respect to the applicable Portion of Investment, which the Agent shall cause to be distributed to the Purchaser, the Agent and any other Indemnified Party or Affected Person in payment in full of any amounts owed thereto pursuant to Section 1.7 , Section 1.8 , Section 3.1 , or Section 5.4 or under any other Transaction Document in respect of the applicable Portion of Investment;

 

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(F) Daily Permitted Reinvestment in the Participation; Maximum Participation . On each Originator Business Day, subject to Section 1.4(f) , the Seller or its duly authorized designee may reinvest Available Collections on deposit in the Collection Accounts and not otherwise required to be set aside and maintained pursuant to paragraph (B)  above or otherwise allocated pursuant to clause (iii) of paragraph (C)  above by applying such amounts at its discretion or otherwise due and owing to any Indemnified Party or Affected Person in payment in full of any amounts owed thereto pursuant to Section 1.7 , Section 1.8 , Section 3.1 , or Section 5.4 , or to the Purchaser in respect of accrued Breakage Costs (if any); provided , that, after giving effect to any such reinvestment, neither the Euro Participation nor the Sterling Participation shall exceed one hundred percent (100%); provided, further , that if, on any Business Day, any of the Euro Participation or the Sterling Participation shall exceed one hundred percent (100%), the Seller or its duly authorized designee shall set aside and maintain Available Collections in the Collection Accounts on such Business Day for the benefit of the Purchaser in an amount sufficient to reduce such portion of the Participation (the Euro Participation, the Sterling Participation, or both, as applicable) to one hundred percent (100%) and no amounts may be reinvested pursuant to this paragraph (F)  until such portion of the Participation no longer exceeds one hundred percent (100%);

(G) Daily Transfer of Available Collections and Any Amounts Related to Excluded Receivables . On each Originator Business Day that amounts are permitted to be reinvested in accordance with the foregoing paragraph (F) , the Seller or its duly authorized designee shall be entitled to direct the allocation of any Available Collections on deposit in the Collection Accounts in excess of the sum of (w) any amounts reinvested pursuant to paragraph (F)  above, (x) the amounts required to be set aside and maintained in the Collection Accounts pursuant to paragraph (B)  above, (y) amounts otherwise allocated pursuant to clause (iii)  of paragraph (C)  above, and (z) in the event that any Originator’s Pool Receivables are serviced, collected and administered by a Third Party Servicer, all reasonable and appropriate out of pocket costs and expenses due and owing to such Third Party Servicer in excess of the accrued Third Party Servicing Fee paid to such Third Party Servicer pursuant to clause (i)  of paragraph (C)  above (as such excess amount, if any, is set forth in each relevant Daily Report). With respect to any Business Day, amounts on deposit in a Collection Account relating to Excluded Receivables (as determined by the Administrator and the relevant Servicer in accordance with the terms of the Administration Agreement and as set forth in each Daily Report) shall be remitted by the Seller or its duly authorized designee (or, following the occurrence of a Termination Event or Termination Day, by the Agent or its duly authorized designee) on the following Originator Business Day to an account designated by the relevant Originator. The Seller or its duly authorized designee may, after applying Available Collections in accordance with this Section 1.4(b)(i)(G) , apply any excess sums at the Seller’s discretion, including, without limitation, to pay any taxes owed by the Seller; and

 

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(H) Reconciliation. Notwithstanding anything to the contrary contained in this Section 1.4, if, on any Settlement Date, the amounts comprising the Monthly Set Aside Amount calculated in accordance with the definition thereof and previously set aside and maintained in the Collection Accounts pursuant to paragraph (B)  above are insufficient to pay (i) the actual amount of Discount that accrued during the month immediately preceding such Settlement Date for each Portion of Investment (as set forth in the relevant Monthly Report, calculated by the Administrator acting in accordance with its obligations pursuant to the Administration Agreement), and (ii) the actual Third Party Servicing Fee (if any), Administrator Fee, Utilization Fee and Commitment Fee that accrued during the month immediately preceding such Settlement Date (calculated, in each case, by the Administrator acting in accordance with its obligations pursuant to the Administration Agreement), the Seller or its duly authorized designee shall allocate Available Collections as necessary to make up such deficiencies as soon as possible and in no event later than two (2) Business Days following such Settlement Date. If, on any Settlement Date, the amounts comprising the Monthly Set Aside Amount calculated in accordance with the definition thereof and previously set aside and maintained in the Collection Accounts pursuant to paragraph (B)  above exceed the actual amount necessary to make the allocations described in the preceding sentence, the Seller or its duly authorized designee may apply such excess amounts on or after the related Settlement Date at its discretion.

(ii) If a Termination Event or a Termination Day has occurred and is continuing:

(A) Daily Remittance of all Collections . On each Originator Business Day from and after the Business Day on which such Termination Event or Termination Day occurs, each Originator (or the related Servicer on its behalf acting in continued compliance with all of its obligations under the Servicing Agreement) shall remit to the applicable Collection Account (established by the Seller under Section 4.3(b) in such Servicer’s jurisdiction of organization) all funds on deposit in the related Originator Account (except for any minimum balance set forth in the applicable Collection Bank Agreement) and all other Collections received from Obligors, without any right to set-off or exclusion. For the avoidance of doubt, other than as described in the preceding sentence, such Servicer shall not access, move or withdraw any additional amounts from any Originator Account or Collection Account until such Termination Event or Termination Day is no longer continuing.

 

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(c) Priority of Payments following Termination Event or Termination Day . If a Termination Event or a Termination Day has occurred and is continuing, on each such Business Day, amounts on deposit in the Collection Accounts or any account to which the Agent has redirected Obligor payment or payments pursuant to Section 4.4(a)(i) , as applicable, in respect of any Portion of Investment will be allocated by the Agent or its duly authorized designee in the following order of priority; provided that the Agent shall remit any amounts related to Excluded Receivables to the relevant Originator pursuant to the second sentence of Section 1.4(b)(i)(G) as if no Termination Event or Termination day has occurred and is continuing prior to the application of any amounts pursuant to the provisions of this Section 1.4(c) :

(i) first , pro rata, to any accrued Third Party Servicing Fees and accrued Administrator Fees with respect to such Portion of Investment;

(ii) second , pro rata, to accrued Utilization Fee and accrued Commitment Fee with respect to such Portion of Investment;

(iii) third , to accrued Discount with respect to such Portion of Investment;

(iv) fourth , to the full amount of such Portion of Investment;

(v) fifth , to the Agent, the Purchaser and any other Indemnified Party or Affected Person, in payment in full of any amount owed thereto by the Seller or any Servicer in respect of accrued Breakage Costs (if any) or under Section 1.7 , Section 1.8 , Section 3.1 , or Section 5.4 or pursuant to any other Transaction Document;

(vi) sixth , to each Servicer that is not a Third Party Servicer, an amount in respect of the Servicing Fee of such Servicer, in such order as the Agent and the Seller shall determine; and

(vii) seventh , provided that all unpaid and accrued amounts owed pursuant to subclauses (i) through (vi) above and any other amounts payable by the Seller have been paid in full to the Purchaser, the Agent or any other Indemnified Party or Affected Person hereunder or under any other Transaction Document, all additional Collections shall be remitted to the Seller for its own account, including (without limitation) to allow the Seller to pay any taxes owed by it.

 

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(d) [Reserved] .

(e) Deemed Collections . For the purposes of this Section 1.4 :

(i) if on any day the Outstanding Balance of any Pool Receivable is reduced or adjusted as a result of any defective, damaged, rejected, returned, repossessed or foreclosed goods or services, or any discount, rebate, credit, counterclaim, billing error or other adjustment made (other than cash Collections) by the Seller, any Originator or any Servicer, or any setoff or dispute between the Seller, any Originator or any Servicer and an Obligor, 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 any of the representations or warranties in paragraphs (e) , (f)  or (k)  of Section 1 of Exhibit III is not true with respect to any Pool Receivable, the Seller shall be deemed to have received on such day a Collection of such Pool Receivable in full and the Outstanding Balance of such Pool Receivable shall be deemed to be zero;

(iii) if and to the extent the Agent, the Purchaser or any other Indemnified Party shall be required for any reason to pay over to an Obligor (or any trustee, receiver, custodian or similar official as a result of a Bankruptcy Event) any amount received by it hereunder, such amount shall be deemed not to have been so received but rather to have been retained by the Seller and, accordingly, the Agent or the Purchaser, 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;

(iv) all payments made by an Obligor which is obligated to make payments on Pool Receivables but is not obligated to make any payments on Excluded Receivables shall be conclusively presumed to be payments on account of Pool Receivables, and all payments made by an Obligor which is obligated to make payments on Excluded Receivables but is not obligated to make any payments on Pool Receivables shall be conclusively presumed to be payments on account of Excluded Receivables;

(v) all payments made by an Obligor which is obligated to make payments with respect to both Pool Receivables and Excluded Receivables shall be applied against the specific Pool Receivables, if any, which are designated by such Obligor by reference to the applicable invoice as the Pool Receivables with respect to which such payments should be applied and in accordance with the calculations performed by the Administrator in respect of such payments under the Administration Agreement; and

(vi) if an Obligor makes a payment but does not designate the Receivable to which such payment applies, then, except as otherwise required by applicable law or the relevant Contract, such payment shall be applied to the Pool Receivables of such Obligor in the order of the age of such Pool Receivables, starting with the oldest such Pool Receivable.

 

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(f) Reduction of Investment . If at any time the Seller or its duly authorized designee shall wish to cause the reduction of the entire Investment or any Portion of Investment, the Seller or its duly authorized designee may do so as follows:

(i)(A) in the case of a reduction of the entire Investment, the Seller or its duly authorized designee shall give the Agent at least thirty (30) days prior written notice thereof, or (B) in the case of any reduction of a Portion of Investment which is not a reduction of the entire Investment, three (3) Business Days’ prior written notice thereof; in either case, such notice shall be in substantially the form of Annex C and include the amount of such proposed reduction and the proposed date on which such reduction will commence;

(ii) on the proposed date of commencement of such reduction and on each Originator Business Day thereafter, the Seller or its duly authorized designee shall cause Available Collections with respect to the Investment or such Portion of Investment (including to any related Discount) not to be reinvested until the amount thereof not so reinvested shall equal the desired amount of reduction (including any amounts owed in connection with such reduction pursuant to Section 1.4(b)(i)(E) , in each case as calculated by the Administrator in accordance with the Administration Agreement); and

(iii) the Seller or its duly authorized designee shall set aside such Available Collections, for payment to the Agent on the Business Day that such amounts set aside equal the amount described in clause (ii)  above (and in the case of a reduction of the entire Investment, the Seller or its duly authorized designee shall instruct the relevant Servicer to set aside in the relevant Collection Account for payment on such date Available Collections in an amount equal to all other obligations of the Seller or any Servicer to the Purchaser, the Agent and each other Indemnified Party or Affected Person hereunder, in each case, as calculated by the Administrator in accordance with the Administration Agreement), and the Investment or the applicable Portion of Investment shall be deemed reduced in the amount to be paid to the Agent only when in fact finally so paid;

provided that,

(A) the amount of any such reduction shall not be less than €500,000 or £500,000, as applicable, and integral multiples of €50,000 or £50,000, as applicable, in excess thereof and the entire Investment of the Participation after giving effect to such reduction shall be not less than €25,000,000 unless the entire Investment shall have been reduced to zero;

 

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(B) the Seller or its duly authorized designee shall choose a reduction amount, and the date of commencement thereof, so that to the extent practicable such reduction shall commence and conclude in the same Yield Period; and

(C) if two or more Portions of Investment shall be outstanding at the time of any proposed reduction and the Seller or its duly authorized designee shall fail to specify in the notice given pursuant to Section 1.4(f)(i) (x) the applicable Portion or Portions of Investment to be reduced and (y) the amount of such reduction to be applied to each such Portion of Investment, such proposed reduction shall be applied to the Portion of Investment with the shortest remaining Yield Period (and, if only a portion of such proposed reduction shall be sufficient to repay such Portion of Investment in full, the remainder of such reduction shall be applied to the Portion of Investment with the next shortest remaining Yield Period, etc.).

Section 1.5 Fees . The Seller shall pay to the Purchaser certain fees in the amounts and on the dates set forth in a letter dated as of the Closing Date among the Seller, the Agent, the Purchaser and each Servicer (as the same may be amended, amended and restated, supplemented or modified, the “ Fee Letter ”) delivered pursuant to Section 1 of Exhibit II .

Section 1.6 Payments and Computations, Etc . (a) All amounts to be paid or deposited by the Seller or to be deposited by the Servicer hereunder shall be paid or deposited on the day when due in same day funds as follows: (i) the Servicing Fee of JDI France, JDI Spain and any other Servicer in the Eurozone shall be paid in Euro (€); (ii) the Servicing Fee of JDI UK shall be paid in Pounds Sterling (£) (except with respect to any Euro Receivables serviced by JDI UK, in which case such fee shall be paid in Euro (€)); (iii) the Utilization Fee, Commitment Fee and Breakage Costs shall be paid in the currency applicable to the Portion of Investment in respect of which such amounts were accrued, (iv) amounts payable pursuant to Sections 1.7, 1.8, 3.1, or 5.4 shall be payable in the currency designated by each Person entitled to payment under such Sections, and (v) all Collections shall be deposited by each Servicer into the applicable Collection Account, without any right of set-off or exclusion (subject to Section 1.4(b)(i)(A) (provided that a Termination Event or Termination Day has not occurred or is continuing) and the second sentence of Section 1.4(b)(i)(G) ). For the avoidance of doubt, no amounts relating to Excluded Receivables shall be required to be paid into the Purchaser’s Account and such amounts shall be held in trust by the Seller on behalf of the relevant Originator pending remittance to such Originator in accordance with the second sentence of Section 1.4(b)(i)(G) of this Agreement. All amounts payable to the Purchaser shall be deposited to the Purchaser’s Account. All amounts to be paid or deposited shall be received on or before 12:00 p.m. New York time. All amounts received after 12:00 p.m. New York time will be deemed to have been received on the immediately succeeding Business Day.

 

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(b) The Seller or its duly authorized designee shall, to the extent permitted by law, pay interest on any amount not paid or deposited by the Seller or a Servicer when due hereunder (subject to any applicable grace periods), at an interest rate equal to two percent (2%)  per annum above the Base Rate, payable on demand.

(c) All computations of interest under subsection (b)  above and all computations of Discount, fees, and other amounts hereunder shall be made on the basis of a year of three hundred sixty (360) days (other than Discount and/or fees calculated on the Base Rate which shall be computed on the basis of a year of three hundred sixty-five (365) or three hundred sixty-six (366) days, as the case may be) for the actual number of days elapsed. Whenever any payment or deposit to be made under this Section 1.6 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 (without the addition of any additional interest set forth in Section 1.6(b) ).

(d) From time to time, upon reasonable request by the Seller or its duly authorized designee, the Agent shall promptly notify the Seller or such party, as applicable, in response to such request, as to changes in the Base Rate, the CP Rate and the EURIBOR Rate; provided that the failure of such notice to be requested or given shall not waive, preclude, delay or otherwise limit the effectiveness of any such change.

Section 1.7 Increased Costs . (a) If the Agent, the Purchaser, any Liquidity Bank, any other Program Support Provider or any of their respective applicable Affiliates (each an “ Affected Person ”) determines that the existence of or compliance with (i) any law, rule or regulation (including any applicable law, rule or regulation regarding capital adequacy) of any Governmental Authority or any change therein or in the interpretation or application thereof, in each case adopted, issued or occurring after the date hereof or (ii) any request, guideline or directive from any central bank or other Governmental Authority (whether or not having the force of law) issued or occurring after the date of this Agreement affects the amount of capital required or expected to be maintained by such Affected Person and such Affected Person determines (acting reasonably) 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 related to this Agreement or any related liquidity facility or credit enhancement facility and other commitments of the same type, then, upon demand by such Affected Person (with a copy to the Agent), the Seller or its duly authorized designee shall promptly pay to the Agent, for the account of such Affected Person, from time to time as specified by such Affected Person, additional amounts reasonably calculated 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 Agent by such Affected Person certifying, in reasonably specific detail, the basis for, and calculation of such amounts, shall be conclusive and binding for all purposes, absent manifest error.

 

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(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 1.8 ) 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 Affected Person of agreeing to purchase or purchasing, or maintaining the ownership of the Participation in respect of which Discount is computed by reference to the EURIBOR Rate, then, upon demand by such Affected Person, the Seller or its duly authorized designee shall promptly pay to such Affected Person, from time to time as specified, additional amounts reasonably calculated as being sufficient to compensate such Affected Person for such increased costs. A certificate as to such amounts submitted to the Seller by such Affected Person certifying, in reasonably specific detail, the basis for, and calculation of such amounts, shall be conclusive and binding for all purposes, absent manifest error.

Section 1.8 Requirements of Law . In the event that any Affected Person determines that the existence of or compliance with any law, rule or regulation of any Governmental Authority or any change therein or in the interpretation or application thereof, in each case adopted, issued or occurring after the date hereof or any request, guideline or directive from any central bank or other Governmental Authority (whether or not having the force of law) issued or occurring after the date of this Agreement:

(i) subjects such Affected Person to any tax of any kind whatsoever (other than Excluded Taxes and except as provided in the last sentence of this Section 1.8 ) with respect to this Agreement, any increase in the Participation or in the amount of Investment relating thereto, or does or shall change the basis of taxation of payments to such Affected Person on account of Collections, Discount or any other amounts payable hereunder other than Excluded Taxes; or

(ii) imposes, modifies or holds applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, or deposits or other liabilities in or for the account of, purchases, advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Affected Person which are not otherwise included in the determination of the EURIBOR Rate or the Base Rate hereunder; or

(iii) imposes on such Affected Person any other condition; and

(iv) the result under subclauses (i), (ii) or (iii) above is (x) to increase the cost to such Affected Person of acting as Agent, or of agreeing to purchase or purchasing or maintaining the ownership of undivided ownership interests with regard to the Participation (or interests therein) or any Portion of Investment in respect of which Discount is computed by reference to the EURIBOR Rate or the Base Rate or (y) to reduce any amount receivable hereunder (whether directly or indirectly) funded or maintained by reference to the EURIBOR Rate or the Base Rate;

 

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then, in any such case, upon demand by such Affected Person the Seller shall pay such Affected Person any additional amounts reasonably calculated as being sufficient to compensate such Affected Person for such additional cost or reduced amount receivable. All such amounts shall be payable as incurred. A certificate from such Affected Person to the Seller certifying, in reasonably specific detail, the basis for, calculation of, and amount of such additional costs or reduced amount receivable shall be conclusive and binding for all purposes, absent manifest error.

This Section 1.8 shall not apply with respect to any tax assessed on an Affected Person to the extent a loss, liability or cost is compensated for by an increased payment under Section 5.4 or would have been compensated for by an increased payment under Section 5.4 but was not so compensated solely because one of the exclusions in paragraph (h) of Section 5.4 applied.

Section 1.9 Inability to Determine EURIBOR Rate . In the event that the Agent shall have reasonably determined prior to the first day of any Yield Period (which determination shall be conclusive and binding upon the parties hereto) by reason of circumstances affecting the interbank EURIBOR market, generally, either (a) Euro (€) deposits in the relevant amounts and for the relevant Yield Period are not available, (b) adequate and reasonable means do not exist for ascertaining in a timely manner the EURIBOR Rate for such Yield Period or (c) the EURIBOR Rate determined pursuant hereto does not accurately and fairly reflect the cost to the Purchaser (as reasonably determined by the Agent) of maintaining any Portion of Investment during such Yield Period, the Agent shall promptly give telephonic notice of such determination, confirmed in writing, to the Seller as promptly as practicable prior to the first day of such Yield Period. Upon delivery of such notice (a) no Portion of Investment shall be funded thereafter at the Bank Rate determined by reference to the EURIBOR Rate, unless and until the Agent shall have given notice to the Seller that the circumstances giving rise to such determination no longer exist, and (b) with respect to any outstanding Portions of Investment then funded at the Bank Rate determined by reference to the EURIBOR Rate, such Bank Rate shall automatically be converted to the Bank Rate determined by reference to the Base Rate.

ARTICLE II

REPRESENTATIONS AND WARRANTIES; COVENANTS;

TERMINATION EVENTS

Section 2.1 Representations and Warranties; Covenants . The Seller hereby makes the representations and warranties, and hereby agrees to perform and observe the covenants, set forth in Exhibits III , IV and VI , respectively hereto.

Section 2.2 Termination Events . If any of the Termination Events in Exhibit V hereto shall occur and be continuing, taking into account any relevant grace periods, the Agent may, by notice to the Seller, declare the Facility Termination Date to have occurred (in which case the Facility Termination Date shall be deemed to have occurred); provided that, automatically upon the occurrence of

 

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any event described in subsection (q)  of Exhibit V , the Facility Termination Date shall occur. Upon any declaration, occurrence or deemed occurrence of the Facility Termination Date, the Purchaser and the 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 applicable law, which rights and remedies shall be cumulative, subject to the limitations on enforcement rights and remedies described in Section 4.4 .

ARTICLE III

INDEMNIFICATION

Section 3.1 Indemnification .

(a) Indemnities by the Seller . Subject to Section 5.16 , without limiting any other rights that the Agent, the Purchaser, the Administrator, any Liquidity Banks, any other Program Support Providers, or any of their respective Affiliates, employees, agents, successors, transferees or assigns (each of the Agent, the Purchaser, the Administrator, the Liquidity Banks, the other Program Support Providers, and their respective Affiliates, employees, agents, successors, transferees and assigns may be referred to as an “ Indemnified Party ”) (for the avoidance of doubt, the Administrator will not be an Indemnified Party for the purposes of paragraph (viii) of this Section 3.1(a) ) may have hereunder or under applicable law, the Seller hereby agrees to indemnify each Indemnified Party from and against any and all claims, damages, taxes, costs, expenses, losses, judgments, liabilities and other amounts (including Attorney Costs) (all of the foregoing being collectively referred to as “ Indemnified Amounts ”) arising out of or resulting from this Agreement or the other Transaction Documents (whether directly or indirectly) or the use of proceeds of purchases or reinvestments or the ownership of the Participation (or a portion thereof), or any interest therein, or in respect of any Receivable or any Contract, excluding, however, (a) Indemnified Amounts to the extent resulting from fraud, gross negligence or willful misconduct on the part of such Indemnified Party, (b) any Excluded Taxes or any tax assessed on an Indemnified Party to the extent a loss, liability or cost is compensated for by an increased payment under Section 5.4 or would have been compensated for by an increased payment under Section 5.4 but was not so compensated solely because one of the exclusions in paragraph (h) of Section 5.4 applied, (c) any special, indirect or consequential damages suffered by any Indemnified Party or punitive damages asserted by an Indemnified Party, (d) Indemnified Amounts to the extent the same includes losses in respect of Receivables which were Eligible Receivables as of the date transferred to the Seller and which are uncollectible on account of the insolvency, bankruptcy, or lack of creditworthiness of the related Obligor, (e) any Indemnified Amount to the extent the same has been fully and finally paid in cash to such Indemnified Party pursuant to any other provision of this Agreement or any other Transaction Document, (f) any Breakage Costs or (g) Indemnified Amounts claimed by any Indemnified Party arising by reason of such Indemnified Party’s default hereunder. Without limiting or being limited by the foregoing, but subject to the exclusions set forth in the preceding sentence, the Seller shall pay within ten (10) Business Days of receipt of 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:

(i) the failure of any Receivable included in the calculation of the Net Eligible Euro Pool Balance or the Net Eligible Sterling Pool Balance to be an Eligible Receivable, the failure of any information contained in a Monthly Report to be true and correct in all material respects, or the failure of any other information provided to the Purchaser or the Agent by a Responsible Officer with respect to Receivables or this Agreement to be true and correct in all material respects;

 

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(ii) the failure of any representation or warranty or statement made or deemed made by a Responsible Officer of the Seller under or in connection with this Agreement to have been true and correct in all material respects when made;

(iii) the failure by the Seller 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 in all material respects to any such applicable law, rule or regulation;

(iv) the failure to vest in the Purchaser a valid and enforceable (A) perfected undivided percentage ownership interest, to the extent of the Participation, in the Receivables in, or purporting to be in, the Receivables Pool and the Related Security and Collections with respect thereto and (B) first priority perfected security interest in the Secured Assets, in each case, free and clear of any Adverse Claim (other than Permitted Adverse Claims);

(v) to the extent required by any Transaction Document, and taking into account any relevant grace periods, the failure to have filed, or any delay in filing, any financing statements or other similar instruments or documents under applicable laws (including, without limitation, any and all documents required to perfect the Agent’s and Purchaser’s security interest in the Receivables transferred under the Sale Agreements) 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 in accordance with the terms hereof;

(vi) any dispute, claim, offset or defense of the relevant 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 goods or services related to such Receivable or the furnishing or failure to furnish such goods or services or relating to collection activities with respect to such Receivable;

 

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(vii) any failure of the Seller or any Servicer to perform its collection and/or administrative duties or obligations;

(viii) any failure of the Administrator to perform its duties under the Administration Agreement;

(ix) any products liability or other claim, investigation, litigation or proceeding arising out of or in connection with merchandise, insurance or services which are the subject of any Contract;

(x) any failure or inability to collect on Receivables due to the commingling of Collections of Pool Receivables at any time with other funds;

(xi) any investigation, litigation or proceeding related to this Agreement or the use of proceeds of purchases or reinvestments of the ownership of the Participation or in respect of any Receivable, Related Security or Contract;

(xii) any reduction in Investment as a result of the distribution of Collections pursuant to Section 1.4 , in the event that all or a portion of such distributions shall thereafter be rescinded or otherwise must be returned for any reason;

(xiii) any tax or governmental fee or charge, all interest and penalties thereon or with respect thereto, and all reasonable out of pocket costs and expenses, including the reasonable fees and expenses of counsel in defending against the same, which are required to be paid by reason of the purchase or ownership of the Participation, or other interests in the Receivables Pool or in any Related Security or Contract;

(xiv) any Collection Bank Agreement;

(xv) reasonable out of pocket costs and expenses of the Agent, Purchaser and the Liquidity Banks, including without limitation Attorney Costs, in connection with any Termination Event or Servicer Termination Event or the enforcement of any Transaction Document;

(xvi) inability to enforce any judgment relating to the Transaction Documents and the transactions evidenced thereby in any applicable jurisdiction;

 

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(xvii) any loss as a result of the transfer of Eligible Receivables from an Originator to the Seller that was purported to be a true sale not in fact being a true sale; or

(xvii) any loss as a result of the Seller’s failure to transfer any Related Security to the Purchaser (including, for the avoidance of doubt, any loss as a result of the Agent’s inability to enforce the Purchaser’s rights to payment under any related Contract); or

(xviii) any loss as a result of the Seller’s failure to transfer or license to any Successor Servicer the use of all software necessary or desirable to collect the Pool Receivables and the Related Security or make the same available to the Agent or its designee pursuant to Section 4.4(a)(v) .

Without limiting or being limited by the foregoing, if any Indemnified Party incurs any loss or expense (including any loss or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Indemnified Party) (such loss or expense may be referred to as “ Breakage Costs ”) as a result of (i) the full or partial repayment or reduction of all or any Portion of Investment on any day other than the scheduled last day of a Yield Period with respect thereto or on any day in an amount greater than the amount specified by the Seller or any Servicer or (ii) any Payment not being made (other than as a result of a default by the Purchaser) in accordance with a notice pursuant to Section 1.2(a) , then upon demand by such Indemnified Party, the Seller shall pay to such Indemnified Party the amount of such Breakage Costs.

The obligations of the Seller under this Section 3.1(a) shall survive the resignation or removal of the Agent and the execution, delivery, performance and termination of this Agreement, regardless of any investigation made by any Indemnified Party.

ARTICLE IV

COLLECTIONS

Section 4.1 [Reserved].

Section 4.2 [Reserved].

Section 4.3 Establishment and Use of Certain Accounts .

(a) Originator Accounts . Schedule II sets forth a complete listing of the Originator Accounts. On or prior to the Closing Date, with respect to each Originator Account, each Originator shall have (i) entered into one or more Collection Bank Agreements (in form and substance satisfactory to the Agent) with each Collection Bank in its country of organization, (ii) delivered original counterparts thereof to the Agent and (iii) provided their respective Obligors with written instructions directing them to remit all future payments in respect of Pool Receivables to the applicable Collection Account established by the Seller pursuant to Section 4.3(b) . Prior to the

 

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occurrence and continuance of a Termination Event, each Servicer shall, pursuant to the Servicing Agreement, have access to the related Originator Account or Originator Accounts and shall direct the disposition of funds in such Originator Accounts, in accordance with this Section 4.3(a) and the Transaction Documents, generally. Each Originator shall pledge its rights to all amounts in the Originator Accounts to the Seller pursuant to the relevant Sale Agreement. Neither the Originator Accounts nor the related Collection Bank Agreements may be terminated without the prior written consent of the Agent.

(b) Collection Accounts . Schedule II sets forth a complete listing of the Collection Accounts. Prior to the initial purchase hereunder, the Seller shall establish Collection Accounts at the Collection Banks in the name of the Seller. On the Closing Date, the Seller shall enter into a Collection Bank Agreement in form and substance satisfactory to the Agent covering each Collection Account with the related Collection Bank, and deliver original counterparts thereof to the Agent. The Seller shall pledge its rights to all amounts in the Collection Accounts to the Agent for the benefit of the Purchaser and prior to the occurrence and continuance of a Termination Event, the Seller shall have access to the Collection Accounts and shall direct the disposition of funds in the Collection Accounts in accordance with this Agreement. Pursuant to the applicable Collection Bank Agreement, upon the occurrence of a Termination Event, the Agent (for the benefit of the Purchaser) shall have sole dominion and control over each Collection Account, including the ability to exercise all rights with respect thereto, including without limitation, the exclusive right to receive all Collections deposited therein, subject to the second sentence of Section 1.4(b)(i)(G) and the first sentence Section 1.4(c) of this Agreement. Pursuant to the applicable Collection Bank Agreement, upon the occurrence of a Termination Event, the Seller shall not have any ability to control or direct the application of any Collections deposited in the Collection Accounts. Neither the Collection Accounts nor the related Collection Bank Agreements may be terminated without the prior written consent of the Agent.

(c) Permitted Investments . Any amounts in a Collection Account that have been set aside pursuant to Section 1.4 may be invested at the direction of the Agent in Permitted Investments, so long as (i) either (A) such Permitted Investments are purchased in the name of the Purchaser or (B) such Permitted Investments are held in another manner sufficient to establish the Purchaser’s first priority perfected security interest (or equivalent thereto under applicable law) over such Permitted Investments and (ii) such Permitted Investments are scheduled to mature prior to the last day of the Yield Period during which such investment is made prior to the next Settlement Date.

(d) Control of Originator Accounts and Collection Accounts . The Agent may at any time following the occurrence and during the continuance of a Termination Event give notice to each Collection Bank that the Agent is exercising its rights under the Collection Bank Agreements to do any or all of the following: (i) to have exclusive control of the Originator Accounts and/or Collection Accounts transferred to the Agent, to the extent provided in the related Collection Bank Agreements and permitted under applicable law, (ii) to have the proceeds that are sent to the respective Originator Accounts and/or Collection Accounts in respect of Pool

 

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Receivables be redirected pursuant to its instructions rather than deposited in the applicable Originator Accounts and/or Collection Accounts, and (iii) to take any or all other actions permitted under the applicable Collection Bank Agreements and applicable law. The Seller and each Originator hereby agree that if the Agent at any time takes any action set forth in and in accordance with the preceding sentence, the Agent shall have exclusive control of the proceeds (including Collections) of all Pool Receivables and the Seller and each Originator hereby further agree to take any other action that the Agent may reasonably request to transfer such control. Any proceeds of Pool Receivables received by the Seller, any duly authorized designee of the Seller, any Originator or any Servicer thereafter shall be sent immediately to the Agent. The parties hereto hereby acknowledge that if at any time the Agent takes control of any Originator Account or Collection Account, the Agent shall not have any rights to the funds therein in excess of the unpaid amounts due to the Agent, the Purchaser or any other Person hereunder and any such funds shall be distributed by the Agent in accordance with the provisions set forth in Section 1.4 .

Section 4.4 Enforcement Rights . (a) Notwithstanding anything to the contrary in any relevant Collection Bank Agreement, at any time following the occurrence of any Termination Event which is continuing:

(i) the Agent may direct the Obligors that payment of all amounts payable under any Pool Receivable be made directly to the relevant Collection Account or an alternate account or accounts held in the name of the Seller or its designee (at a bank which has a short-term credit rating of A-1 or higher by S&P for so long as such account or accounts are held at such bank);

(ii) the Agent may instruct the Seller or any Servicer to give notice of the Purchaser’s interest in Pool Receivables to each Obligor, which notice may direct that payments be made directly to the relevant Collection Account or an alternate account or accounts held in the name of the Seller or its designee, and upon such instruction from the Agent, the Seller or such Servicer, as applicable, shall give such notice at the expense of the Seller; provided , that if the Seller or such Servicer fails to so notify each Obligor, as soon as practicable and in no event later than three (3) Originator Business Days, in the case of a Pool Receivable originated by JDI UK, or five (5) Originator Business Days, in the case of any Pool Receivable not originated by JDI UK, the Agent may so notify the Obligors; and

(iii) the Agent may request the Seller or any Servicer to, and upon such request the Seller or such Servicer, as applicable, shall segregate all cash, checks and other instruments received by it from time to time constituting Collections with respect to the Pool Receivables in a manner reasonably acceptable to the Agent and, promptly upon receipt, remit all such cash, checks and instruments, duly endorsed or with duly executed instruments of transfer (in favor of the Seller), to the Agent or its designee.

 

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In addition to the rights and remedies described above, at any time following the occurrence of any of the Termination Events contemplated by subsections (a) , (b) , (c) , (m)  and (q)  of Exhibit V which is continuing:

(iv) the Agent may (at the expense of the Seller), after any notification pursuant to Section 4.4(a)(ii) above (by the Seller, any Servicer or the Agent), enforce collection of any such Receivables and adjust, settle or compromise the amount or payment thereof; and

(v) the Agent may request the Seller or any Servicer to, and upon such request the Seller or such Servicer, as applicable, shall assemble all of the records necessary or desirable to collect the Pool Receivables and the Related Security, and transfer or license to any Successor Servicer the use of all software (to the extent permitted by applicable law and subject to the restrictions contained in any license with respect thereto) necessary or desirable to collect the Pool Receivables and the Related Security, and make the same available to the Agent or its designee at a place selected by the Agent.

(b) The Seller hereby authorizes the Agent, and irrevocably appoints the Agent as its attorney-in-fact with full power of substitution and with full authority in the place and stead of the Seller, which appointment is coupled with an interest, during the occurrence and continuance of any of the Termination Events contemplated by subsections (a) , (b) , (c) , (m)  and (q)  of Exhibit V , to take any and all steps in the name of the Seller and on behalf of the Seller reasonably necessary or desirable, in the determination of the Agent, to enforce and collect any and all amounts or portions thereof due under any and all Pool Receivables, Related Security and related Contracts. During the occurrence and continuance of any Termination Event, such appointment will empower the Agent, without limitation, to endorse the name of the Seller on checks and other instruments representing Collections. Notwithstanding anything to the contrary contained in this subsection (b) , none of the powers conferred upon such attorney-in-fact shall subject such attorney-in-fact to any liability if any action taken by it shall prove to be inadequate or invalid, nor shall they confer any obligations upon such attorney-in-fact in any manner whatsoever, except to the extent arising out of the negligence or willful misconduct of such attorney-in-fact.

Section 4.5 Responsibilities of the Seller . Notwithstanding anything herein to the contrary, the Seller shall (i) perform all of its obligations, if any, under the Contracts related to the Pool Receivables to the same extent as if interests in such Pool Receivables had not been transferred hereunder, and the exercise by the Agent or the Purchaser of its rights hereunder shall not relieve the Seller from such obligations, and (ii) pay when due any taxes, including, without limitation, any sales taxes payable in connection with the Pool Receivables and their creation and satisfaction. The Agent and the Purchaser shall not have any obligation or liability with respect to any Pool Receivable, any Related Security or any related Contract, nor shall any of them be obligated to perform any of the obligations of the Seller under any of the foregoing.

 

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ARTICLE V

MISCELLANEOUS

Section 5.1 Amendments, Etc . No amendment or waiver of any provision of this Agreement or consent to any departure by the Seller or any Servicer therefrom shall be effective unless in a writing signed by the Agent, and, in the case of any amendment, by the Seller and the Servicers, 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 material amendment (as reasonably determined by the Agent) shall be effective until the Rating Agencies have notified the Agent and the Seller in writing that such action will not result in a reduction or withdrawal of the rating of any Notes or, in the case of S&P, the rating of the Variable Funding Notes required by Section 1 of Exhibit II . The Agent shall promptly furnish to S&P a copy of any amendment, supplement, restatement or modification of any of the Transaction Documents (i) to which it is a party and (ii) to which the Seller is a party, provided that the Agent has received a copy of the same from the Seller pursuant to the Seller’s obligations under paragraph (q)  of Exhibit IV . No failure on the part of the Purchaser or the Agent to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right.

Section 5.2 Notices, Etc.; Extension of Liquidity Termination Date . (a) All notices and other communications hereunder shall, unless otherwise stated herein, be in writing (which shall include facsimile communication) and sent or delivered, to each party hereto, at its address set forth under its name on Schedule I hereto, 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 first class mail), and notices and communications sent by other means shall be effective when received.

(b) The Seller may advise the Agent in writing of its desire to extend the Liquidity Termination Date for an additional three hundred sixty-four (364) days, provided such request is made not more than one-hundred twenty (120) days prior to, and not less than sixty (60) days prior to, the then current Liquidity Termination Date. The Agent shall notify the Seller in writing, within thirty-five (35) days after its receipt of such request by the Seller, whether the Agent, the Purchaser and the Liquidity Banks are agreeable to such extension (it being understood that any of such parties may accept or decline such a request in their sole discretion and on such terms as they may elect) and, to the extent the Liquidity Banks are agreeable, the Seller, the Agent, the Purchaser and the Liquidity Banks shall enter into such documents as the Liquidity Banks may reasonably deem necessary or appropriate to reflect such extension, and all reasonable costs and expenses incurred by the Liquidity Banks, the Purchaser and the Agent in connection therewith (including Attorney’s Costs) shall be paid by the Seller; it being understood, that the failure of the Agent to so notify the Seller as set forth above shall not be deemed to be a consent to such request for extension.

 

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Section 5.3 Assignability . (a) The Purchaser may not assign the Variable Funding Notes, this Agreement, its rights and obligations herein, or its ownership of the Participation. For the avoidance of doubt, this prohibition on assignment by the Purchaser shall also bind its successors and assigns.

(b) The Purchaser may at any time sell or grant to one or more banks or other institutions that are parties to the Liquidity Agreement (each a “ Liquidity Bank ”) or to any other Program Support Provider, participating interests or security interests in the Participation. In the event of any such sale or grant by the Purchaser of a participating interest to a Liquidity Bank or other Program Support Provider, the Purchaser shall remain responsible for the performance of its obligations hereunder. The Seller agrees that each Liquidity Bank or other Program Support Provider shall be entitled to the benefits of Sections 1.7 , 1.8 and 1.9 . No bank or other financial institution (other than NORD/LB and those institutions for which the Agent shall have given Seller notice on or prior to the Closing Date that are existing as such on the Closing Date) shall become a party to the Liquidity Agreement as a Liquidity Bank without the prior written consent of the Servicers (acting on the instructions of the relevant Originators), which consent shall not be unreasonably withheld.

(c) This Agreement and the rights and obligations of the Agent hereunder shall be assignable, in whole or in part, by the Agent and its successors and assigns.

(d) The Seller may not assign its rights or delegate its obligations hereunder or any interest herein without the prior written consent of the Agent, except, with respect to a delegation of its obligations hereunder (i) to any Servicer, to the extent permitted by the Servicing Agreement and (ii) to any authorized designee (including the Administrator), to the extent expressly provided hereunder or under any other Transaction Document; provided , however, that the Seller shall at all times remain responsible for the performance of such duties and obligations despite any such delegation permitted pursuant to this Section 5.3(d) .

(e) Except with respect to any Obligor before the occurrence of a Termination Event and as otherwise set forth herein, without limiting any other rights that may be available under applicable law, the rights of the Purchaser may be enforced through it or by its agents.

Section 5.4 Costs, Expenses and Taxes . (a) In addition to the rights of indemnification granted under Section 3.1 hereof, the Seller agrees to pay, upon demand, all reasonable costs and expenses in connection with the preparation (including due diligence and negotiation costs), execution, delivery and administration (including auditing Receivables prior to the Closing Date, periodic auditing of Receivables and the servicing thereof from and after the Closing Date) of this Agreement and the other Transaction Documents, including all reasonable costs and expenses relating to the amending, amending and restating, modifying or supplementing of this Agreement and the other Transaction Documents and the waiving of any provisions hereof or thereof (whether or not any such amendment, amendment and restatement, modification, supplement or waiver becomes effective), and including in all cases, without limitation, Attorney Costs for the Agent, the Purchaser and their respective Affiliates and agents with respect thereto and with respect to advising the Agent, the Purchaser and their respective Affiliates and agents as to their rights and remedies under this Agreement and the other Transaction Documents, and all costs and out-of-pocket expenses, if any (including Attorney Costs), of the Agent, the Purchaser and their respective Affiliates and agents, in connection with the enforcement of this Agreement and the other Transaction Documents.

 

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(b) In addition, the Seller shall pay on demand any and all stamp and other documentary taxes and fees payable in connection with the execution, delivery, filing and recording of this Agreement or the other Transaction Documents, and shall hold each Indemnified Party harmless from and against any liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees.

(c) All payments and distributions made under the Transaction Documents by the Seller to the Purchaser or the Agent (each, a “recipient”) shall be made free and clear of and without deduction for any present or future income, excise, stamp or franchise taxes and any other taxes, fees, duties, withholdings or other charges of any nature whatsoever imposed by any taxing authority on any recipient (or any assignee of a recipient) other than Excluded Taxes (such non-excluded items being called “Taxes”). In the event that any withholding or deduction from any payment made by the Seller to a recipient is required in respect of any Taxes, then the Seller shall:

(i) pay directly to the relevant taxing authority the full amount required to be so withheld or deducted within the time allowed;

(ii) promptly forward to the recipient, with a copy to the Agent, an original or certified copy of any official receipt or other documentation evidencing such payment reasonably satisfactory to the recipient and the Agent evidencing such payment to such taxing authority; and

(iii) pay to the recipient such additional amount or amounts as are necessary to ensure that the net amount actually received by the recipient shall equal the full amount such recipient would have received had no such withholding or deduction been required.

(d) If any Taxes are directly asserted against any recipient with respect to any payment or income earned or received by such recipient hereunder or under any other Transaction Documents, the Seller shall within twenty (20) Business Days of written demand pay such additional amounts (including, without limitation, any penalties, interest or expenses) as shall be necessary in order that the net amount received and retained by the recipient after the payment of such Taxes (including any Taxes on such additional amounts) shall equal the amount such recipient would have received had such Taxes not been asserted.

(e) Any recipient that is entitled to an exemption from or reduction of withholding tax under the laws of the jurisdiction in which the Seller is located, or any treaty to which such jurisdiction is a party, with respect to payments under any of the Transaction Documents shall deliver to the Seller at the time or times prescribed by applicable law, such properly completed and executed

 

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documentation prescribed by applicable law, or reasonably requested by the Seller, as will permit such payments to be made without withholding or at a reduced rate; provided, that such recipient is legally entitled to complete, execute and deliver such documentation.

(f) If a recipient determines in its sole and absolute discretion that it has received a tax refund or tax credit as a result of any payment by the Seller pursuant to this Section 5.4, then such recipient shall, to the extent it can do so without prejudice to the amount of any other tax, deduction, credit or relief, pay the Seller such amount as the recipient determines will leave it in no better or worse position than it would have been in if the Seller had not made such payment. The Seller shall return any amount received pursuant to this Section 5.4(f) within ten (10) Business Days of written demand if a taxing authority determines that such recipient is not entitled to such refund or credit. Each recipient shall have sole discretion to arrange its tax affairs without regard to this Section 5.4(f) and no recipient shall be obligated to disclose any tax information to the Seller.

(g) Notwithstanding anything in this Agreement to the contrary, the Seller shall not be required to pay to any recipient any amount pursuant to this Section 5.4 to the extent such amount has been fully and finally paid in cash to such recipient pursuant to any other provision of this Agreement or any other Transaction Document.

(h) The Seller shall not be required to make an increased payment to a recipient under subsection (c) above for any deduction or withholding for or on account of Taxes from a payment under a Transaction Document imposed under the laws of Ireland if on the date on which the payment falls due the payment could have been made to the relevant recipient without such deduction or withholding if it was a Qualifying Lender, but on that date the recipient is not or has ceased to be a Qualifying Lender other than as a result of any change after the date it became a party to a Transaction Document in (or in the interpretation, administration, or application of) any law or double tax treaty or any published practice or concession of any relevant taxing authority.

(i) If a recipient becomes aware that the Seller must make a deduction or withholding on account of Taxes (or that there is change in the rate or the basis of a deduction or withholding on account of Taxes) it must notify the Agent accordingly. If the Agent receives such notification from a recipient it shall notify the Seller.

(j) The Purchaser represents to the Seller on entering into this Agreement that it is a Qualifying Lender and it undertakes that it shall promptly notify the Seller if it ceases to be a Qualifying Lender.

Section 5.5 No Proceedings; Limitation on Payments . (a) Each of the Seller, the Agent, each assignee of the Participation or any interest therein, and each Person which enters into a commitment to purchase the Participation or interests therein, hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, the Purchaser or any other Note Issuer, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or similar law, for one year and one day after the latest maturing Note issued by the Purchaser or any such Note Issuer is paid in full.

 

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(b) Notwithstanding any provisions contained in this Agreement to the contrary, the Purchaser shall not, and shall not be obligated to, pay any amount payable by it pursuant to this Agreement or any other Transaction Document unless (i) the Purchaser has received funds which may be used to make such payment and which funds are not required to repay the Notes when due and (ii) after giving effect to such payment, either (x) the Purchaser could issue Notes to refinance all outstanding Notes (assuming such outstanding Notes matured at such time) in accordance with the program documents governing the Purchaser’s securitization program or (y) all Notes are paid in full. Any amount which the Purchaser does not pay pursuant to the operation of the preceding sentence shall not constitute a claim (as defined in § 101 of the Bankruptcy Code) against or corporate obligation of the Purchaser for any such insufficiency unless and until the Purchaser satisfies the provisions of subclauses (i)  and (ii)  above.

Section 5.6 Confidentiality . Unless otherwise required by applicable law (including the disclosure requirement of applicable securities laws) or any official body (including any judge or court), the Seller agrees to maintain the confidentiality of this Agreement and the other Transaction Documents (and all drafts thereof) in communications with third parties and otherwise; provided that this Agreement may be disclosed to (a) third parties to the extent such disclosure is made pursuant to a written agreement of confidentiality in form and substance reasonably satisfactory to the Agent, (b) to the extent required by applicable law or any official body and (c) the Seller’s legal counsel and auditors if they agree to hold it confidential; provided that only the terms and conditions of this Agreement may be revealed to such parties and not the details of any fees, pricing or interest rates. Unless otherwise required by applicable law, each of the Agent and the Purchaser agrees to maintain the confidentiality of non-public financial information regarding each Servicer and its Subsidiaries and other information marked as confidential by such Servicer or the Seller; provided , that such information may be disclosed to: (i) third parties to the extent such disclosure is made pursuant to a written agreement of confidentiality in form and substance reasonably satisfactory to each Servicer, (ii) legal counsel and auditors of the Purchaser or the Agent if they agree to hold it confidential, (iii) the Rating Agencies rating the Variable Funding Notes or the Notes, (iv) any Program Support Provider or potential Program Support Provider (if they agree to hold it confidential), (v) any placement agent placing the Notes and (vi) any regulatory authorities having jurisdiction over the Agent, the Purchaser, any Program Support Provider or any Liquidity Bank. Nothing in this Section 5.6 shall prevent disclosure of information as part of a legal proceeding relating to litigation in respect of this Agreement or any other Transaction Document.

Section 5.7 GOVERNING LAW AND JURISDICTION . (a) THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK, BUT WITHOUT REGARD TO ANY OTHER CONFLICT OF LAWS PROVISIONS THEREOF).

 

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(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PURCHASER, THE SELLER AND THE AGENT CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PURCHASER, THE SELLER AND THE AGENT IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE PURCHASER, THE SELLER AND THE AGENT EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.

Section 5.8 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 5.9 Survival of Termination . The provisions of Sections 1.7 , 1.8 , 1.9 , Article III and this Article V shall survive any termination of this Agreement.

Section 5.10 WAIVER OF JURY TRIAL . EACH OF THE PURCHASER, THE SELLER AND THE AGENT WAIVES ITS RIGHT TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE. EACH OF THE PURCHASER, THE SELLER AND THE AGENT AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, EACH OF THE PARTIES HERETO FURTHER AGREES THAT ITS RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

Section 5.11 Entire Agreement . This Agreement and the other Transaction Documents embodies the entire agreement and understanding between the Purchaser, the Seller and the Agent, and supersedes all prior or contemporaneous agreements and understandings of such Persons, verbal or written, relating to the subject matter hereof and thereof.

 

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Section 5.12 Headings . The captions and headings of this Agreement and in any Exhibit hereto are for convenience of reference only and shall not affect the interpretation hereof or thereof.

Section 5.13 Purchaser’s Liabilities . The obligations of the Purchaser under this Agreement are solely the corporate obligations of the Purchaser. No recourse shall be had for any obligation or claim arising out of or based upon this Agreement against any stockholder, employee, officer, director or incorporator of the Purchaser; and provided , however , that this Section 5.13 shall not relieve any such Person of any liability it might otherwise have for its own gross negligence or willful misconduct. The agreements provided in this Section 5.13 shall survive termination of this Agreement.

Section 5.14 Mutual Negotiations . This Agreement and the other Transaction Documents are the product of mutual negotiations by the parties thereto and their counsel, and no party shall be deemed the draftsperson of this Agreement or any other Transaction Document or any provision hereof or thereof or to have provided the same. Accordingly, in the event of any inconsistency or ambiguity of any provision of this Agreement or any other Transaction Document, such inconsistency or ambiguity shall not be interpreted against any party because of such party’s involvement in the drafting thereof.

Section 5.15 Judgment Currency . This is an international finance transaction in which the specification of Euro (€) or Pounds Sterling (£), as the case may be (the “ Specified Currency ”), and payment in a specified city or country of the Specified Currency (the “ Specified Place ”) is of the essence, and the Specified Currency shall be the currency of account in all events relating to payments denominated in the Specified Currency. The payment obligations of the Seller under this Agreement shall not be discharged or satisfied by an amount paid in another currency or in another place, whether pursuant to a judgment or otherwise, to the extent that the amount so paid on conversion to the Specified Currency and transfer to the Specified Place under normal banking procedures does not yield the amount of the Specified Currency at the Specified Place due hereunder. If for the purpose of obtaining judgment in any court it is necessary to convert a sum due hereunder in the Specified Currency into another currency (the “ Second Currency ”), the rate of exchange that shall be applied shall be the rate at which in accordance with normal banking procedures the Agent could purchase the Specified Currency with the Second Currency on the Business Day next preceding the day on which such judgment is rendered. The obligation of the Seller in respect of any such sum due from it to the Agent or any other Person hereunder or under any other Transaction Document (in this Section 5.15 called an “ Entitled Person ”) shall, notwithstanding the rate of exchange actually applied in rendering such judgment, be discharged only to the extent that on the Business Day following receipt by such Entitled Person of any sum adjudged to be due hereunder in the Second Currency such Entitled Person may in accordance with normal banking procedures purchase and transfer to the Specified Place the Specified Currency with the amount of the Second Currency so adjudged to be due; and the Seller hereby, as a separate obligation and notwithstanding any such judgment, agrees to indemnify such Entitled Person against, and to pay such Entitled Person on demand, in the Specified Currency, the amount (if any) by which the sum originally due to such Entitled Person in the Specified Currency hereunder exceeds the amount of the Specified Currency so purchased and transferred.

 

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Section 5.16 Limited Recourse . The obligations of the Seller to pay any amounts due and payable hereunder and the other Transaction Documents shall be limited to the proceeds available at such time to make such payments in accordance with Section 1.4 of this Agreement and the terms of any other Transaction Document. Notwithstanding anything to the contrary herein or any other Transaction Document, no sum will be due and payable by the Seller except in accordance with Section 1.4 of this Agreement and the terms of any other Transaction Document and any payment obligations of the Seller hereunder or under the Sale Agreements may only be satisfied from the amounts received by it with respect to the Secured Assets under or pursuant to the Transaction Documents. If the security constituted by the Security Documents is enforced, and after payment of all other claims (if any) ranking in priority to or pari passu with each of the claims of the Secured Parties under the Security Documents, the remaining proceeds of such enforcement are insufficient to pay in full all amounts whatsoever due to each of the Secured Parties and all other claims ranking pari passu to the claims of each such party, then the claims of each such party against the Seller will be limited to their respective shares of such remaining proceeds (as determined in accordance with the provisions of the Security Documents) and, after payment to each such party of its respective share of such remaining proceeds, the obligations of the Seller to each such party will be discharged in full.

Section 5.17 Non-Petition . None of the parties hereto, nor the other Secured Parties (nor any other person acting on behalf of any of them) shall be entitled at any time to institute against the Seller, or join in any institution against the Seller of, any bankruptcy, examinership, reorganisation, arrangement, insolvency, winding-up or liquidation proceedings or other proceedings under any applicable bankruptcy or similar law in connection with any obligations of the Seller hereunder or otherwise owed to the Secured Parties, except for lodging a claim in the liquidation of the Seller which is initiated by another party or taking proceedings to obtain a declaration or judgment as to the obligations of the Seller. In addition, none of the parties hereto nor any other person shall have any recourse against any director, shareholder, or officer of the Seller in respect of any obligations, covenant or agreement entered into or made by the Seller pursuant to the terms hereof or any other document relating hereto to which it is a party or any notice or documents which it is requested to deliver hereunder or thereunder.

Section 5.18 SUBMISSION TO JURISDICTION . THE SELLER IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY

 

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APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL 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. NOTHING IN THIS AGREEMENT OR IN ANY OTHER TRANSACTION DOCUMENT SHALL AFFECT ANY RIGHT THAT THE AGENT OR THE PURCHASER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT AGAINST THE SELLER (OR ITS PROPERTIES) OR ANY SERVICER (OR ITS PROPERTIES) IN THE COURTS OF ANY JURISDICTION.

Section 5.19 Service of Process . (a) Each of the Seller, each Originator and each Servicer hereby appoints C T Corporation System (the “ Process Agent ”), with an office on the date hereof at 111 Eight Avenue, 13th Floor New York, New York 10011, as its agent to receive on behalf of each such party and its property and assets service of copies of the summons and complaint and any other process which may be served in any such action, suit or proceeding referred to above and agrees promptly to appoint a successor Process Agent in New York City (which successor Process Agent shall accept such appointment in a writing acceptable to the Agent, in its sole discretion, prior to the termination for any reason of the appointment of the initial Process Agent). In any such action, suit or proceeding, such service may be made on each of the Seller, any Originator or any Servicer, as applicable, by delivering a copy of such process to such party in care of the appropriate Process Agent at such Process Agent’s above address and by depositing a copy of such process in the mails by certified or registered air mail, addressed to such party at its address referred to in Section 5.2 (such service to be effective upon such receipt by the appropriate Process Agent and the depositing of such process in the mails as aforesaid). Each of the Seller, each Originator and each Servicer hereby irrevocably and unconditionally authorizes and directs such Process Agent to accept such service on its behalf. In addition, each of the Seller, each Originator and each Servicer irrevocably and unconditionally consents to the service of any and all process in any such action, suit or proceeding by mailing of copies of such process to such party by certified or registered air mail at its address referred to in Section 5.2 .

(b) Each of the Seller, each Originator and each Servicer hereby irrevocably and unconditionally (i) agrees that nothing in this Section 5.19 shall affect the right to effect service of process in any other manner permitted by law, and (ii) agrees that its consent to service of process by mail in any such action, suit or proceeding referred to above shall be conclusive, and may be enforced in any other jurisdiction (x) by suit, action or proceeding on the judgment, a certified or true copy of which shall be conclusive evidence of the fact and the amount of indebtedness or liability therein described or (y) in any other manner provided by or pursuant to the laws of such other jurisdiction.

Section 5.20 French Subordinated Note . Notwithstanding anything to the contrary in any other Transaction Document the Seller hereby agrees, for value received, to pay to the order of JDI France on or before the date following the Facility Termination Date which is one year and one day after the date on which (i) the Outstanding Balance of all Receivables sold by JDI France to the Seller

 

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pursuant to the terms of the French Sale Agreement has been reduced to zero and (ii) JDI France has paid to the Seller all indemnities, adjustments and other amounts which may be owed hereunder in connection with the Seller’s purchase of Eligible Receivables pursuant to the terms of the French Sale Agreement in immediately available funds the aggregate unpaid principal amount of the French Subordinated Note.

Section 5.21 Payment and Subordination under the French Subordinated Note . JDI France shall have the right to receive any and all payments and prepayments from the Seller relating to the French Subordinated Note (which the Seller shall issue in substantially the form of Annex F hereto), provided that, after giving effect to any such payment or prepayment, the aggregate Outstanding Balance of Receivables hereinafter referred to owned by the Seller at such time exceeds the sum of (a) all unpaid amounts outstanding at such time under this Agreement, plus (b) the aggregate outstanding principal balance of all credit extended under the French Subordinated Note. JDI France hereby agrees that at any time during which the conditions set forth in the proviso of the immediately preceding sentence shall not be satisfied, or at any time after the occurrence of a Termination Event that is continuing, JDI France shall be subordinated in its right of payment to the prior payment of any indebtedness or obligation of the Seller owing to the Agent and the Purchaser under this Agreement. The subordination provisions contained in this Section 5.21 are for the direct benefit of, and may be enforced by, the Agent and the Purchaser and/or any of their respective assignee (for the purposes of this clause and Section 5.22 below, the “Senior Claimants”). Until the date on which the Investment outstanding under this Agreement has been repaid in full and all other obligations of the Seller this referenced herein (all such obligations for the purposes of this clause and Section 5.22 below, being known collectively as, the “Senior Claim”) have been indefeasibly paid and satisfied in full, JDI France shall not institute against the Seller any proceeding of the type describe in paragraph (q) of Exhibit V of this Agreement unless and until the Collection Date has occurred. Should any payment, distribution or security or proceeds thereof be received by JDI France in violation of this Section 5.21, JDI France agrees that such payment shall be segregated, received and held in trust for the benefit of, and deemed to be the property of, and shall be immediately paid over and delivered to the Agent for the benefit of the Senior Claimants.

Section 5.22 Bankruptcy; Insolvency. Upon the occurrence of any proceeding of the type described in paragraph (q) of Exhibit V of this Agreement involving the Seller as debtor, then and in any such event the Senior Claimants shall receive payment in full of all amounts due or to become due on or in respect of the Investment and the Senior Claim (including a Discount after the commencement of any such proceeding whether or not any or all of such Discount is an allowable claim in any such proceeding) before JDI France is entitled to receive payment on the Seller account of the French Subordinated Note, and to that end, any payment or distribution of assets of the Seller of any kind or character, whether in cash, securities or other property, in any applicable insolvency proceeding, which would otherwise be payable to or deliverable upon or with respect to any or all indebtedness under the French Subordinated Note, is hereby assigned to and shall be paid or delivered by the Person making such payment or delivery (whether a trustee in bankruptcy, a receiver, custodian or liquidating trustee or otherwise) directly to the Agent for application to, or as collateral for the payment of, the Senior Claim until such Senior Claim shall have been paid in full and satisfied.

[SIGNATURES FOLLOW]

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written.

 

 

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EXHIBIT I

DEFINITIONS

As used in the Agreement (including its Exhibits), 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). Unless otherwise indicated, all Section, Annex, Exhibit and Schedule references in this Exhibit are to Sections of and Annexes, Exhibits and Schedules to the Agreement.

“ Administration Agreement ” means the Administration Agreement dated as of September 8, 2009 between each Servicer and Finacity.

“ Administrator ” means Finacity or any successor thereto acceptable to each Servicer and the Agent and appointed in accordance with the Administration Agreement.

“ Administrator Fee ” shall have the meaning given thereto in the Administration Agreement.

“ Adverse Claim ” means a lien, security interest, restriction on transfer or other charge or encumbrance, or any other type of preferential arrangement, including the interest of a consignor, it being understood that a lien, security interest, restriction on transfer or other charge or encumbrance, or any other type of preferential arrangement, in favor of or granted to the Seller or the Purchaser pursuant to this Agreement and the other Transaction Documents shall not constitute an Adverse Claim and excluding (i) liens for taxes, assessments or other governmental charges which are not yet due and payable, and (ii) liens granted to any Collection Bank in the Collections held by such bank in the related Originator Account or Collection Account, as the case may be, and solely for and relating to the payment of fees and other charges to such bank and the ability of such bank to recover for returned items, in each case, to the extent described and provided for in the agreement, if any, relating to such account or the applicable Collection Bank Agreement.

“ Affected Person ” has the meaning set forth in Section 1.7 of the Agreement.

“ 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. In the case of the Seller and any Originator, “Affiliate” shall include any Person that is a Subsidiary of Holdings, but shall not include any Person that directly or indirectly is in control of Holdings unless such Person is generally identified by JDI or Holdings as being a unit that is part of the “Commercial Markets Group” (as distinguished from the “Consumer Group”) of the Persons owned in whole or in part by members of the Johnson Family Group.

“ Affiliate Obligor ” means any Obligor that is a Subsidiary of a Parent Obligor or that is an Affiliate of a Parent Obligor.

 

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“ Agent ” shall have the meaning set forth in the preamble to the Agreement.

“ Attorney Costs ” means the reasonable fees and out-of-pocket disbursements (other than with respect to fees and out-of-pocket disbursements in connection with the Agent’s enforcement of its rights and remedies hereunder, which need not be reasonable) evidenced by an invoice of any law firm or other external counsel.

“ Audit Fee Reserve ” means, for any day in the calendar month directly preceding the date of each bi-annual audit conducted at the expense of the Seller pursuant to paragraph (h)  of Exhibit IV , the estimated cost for such audit (as submitted in writing by the relevant third-party auditor to the Seller and the Agent); at all other times, such amount shall be zero (0).

“ Available Collections ” means, with respect to any Business Day, Collections available for distribution on such Business Day (or Originator Business Day, as applicable) pursuant to Section 1.4(b)(i)(A) of this Agreement.

“ Bank Rate ” for any Yield Period for any Portion of Investment of the Participation means an interest rate per annum equal to (A) the EURIBOR Rate for such Yield Period plus two percent (2%) for the first ten days of such Yield Period and (B) the EURIBOR Rate plus two and one-half percent (2.5%) thereafter; provided that the “ Bank Rate ” for each day in a Yield Period occurring during the continuance of a Termination Event shall be an interest rate equal to two percent (2%)  per annum above the Base Rate in effect on such day.

“ Bankruptcy Code ” means the United States Bankruptcy Reform Act of 1978 (11 U.S.C. § 101, et seq .), as amended from time to time.

“ Bankruptcy Event ” means, with respect to any Person, the taking of any action, or the occurrence of any event, of the type described in paragraph (q)  of Exhibit V to the Agreement.

“ Base Concentration Limit ” means, for each day, a percentage, determined by the Administrator, not to exceed five percent (5%).

“ Base Rate ” means for any day, 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 greater of (i) the rate of interest most recently announced by NORD/LB at its branch in Frankfurt, Germany as its prime commercial rate for loans in Euro (€) made within the European Union (which rate is not necessarily intended to be the lowest rate of interest determined by NORD/LB in connection with extensions of credit) and (ii) the latest EURIBOR Rate plus one-half of one percent (0.50%) per annum .

“ Breakage Costs ” is defined in Section 3.1 of the Agreement.

“ Business Day ” means a day (other than a Saturday or Sunday) on which banks are open for general business in New York and in relation to (i) any date for payment or purchase in Euro (€) or Pounds Sterling (£), a day that is also (x) a TARGET Day and (y) a day on which dealings in deposits are conducted by and between banks in the London Interbank market and (ii) a Settlement Date, the first day that is also an Originator Business Day for each Originator hereunder.

 

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“ Calculation Period ” means a calendar month.

“ Change of Control ” means any of the following: (i) the Johnson Family Group, together with Employee Shareholders, shall fail to own, directly or indirectly, with full power to vote or to direct the voting of more than 50% of the voting stock of Holdings, (ii) Holdings shall at any time cease to own, directly or indirectly, all of the issued and outstanding capital stock of JDI (except for one (1) share); or (iii) a majority of the board of directors of Holdings (the “Board”) shall cease for any reason to consist of (A) individuals who were serving as directors of Holdings as of the date of this Agreement, and (B) individuals who subsequently become members of the Board if such individuals’ nomination for election or election to the Board is recommended or approved by a majority of the Board or the Johnson Family Group; or (iv) JDI shall at any time cease to own, directly or indirectly, all of the issued and outstanding capital stock or share capital of each of the Originators and Seller; provided that the event described in clause (iv) hereof shall not constitute a “Change of Control” hereunder if such event relates to the ownership of an Originator and, at or prior to the time of such event, JDI or the applicable Originator shall have repurchased all of the then outstanding Receivables that shall have been originated by such Originator.

“ Charge-off ” means any Receivable which has been, or, consistent with the relevant Credit and Collection Policy, which should be, written off as uncollectible.

“ Closing Date ” means September 8, 2009.

“ Collection Account ” means each account owned and held in the name of the Seller (which account name may include the name of any Originator for the purposes of identification) identified as such on Schedule II, which is pledged, on a first priority basis, to the Purchaser pursuant to Section 1.2(d) of this Agreement, and which is governed by a Collection Bank Agreement.

“ Collection Bank ” means any of the banks or other financial institutions holding one or more Originator Accounts and/or Collection Accounts; provided , that if such bank or financial institution holds one or more Collection Accounts it must have a short-term credit rating as of the Closing Date of A-1 or higher by S&P.

“ Collection Bank Agreement ” means each agreement, in form and substance satisfactory to the Agent, among an Originator or the Seller, as applicable, a Collection Bank, and the Agent and such other Persons as may be acceptable to the Agent (such acceptance not to be unreasonably withheld).

 

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“ Collections ” means, with respect to any Pool Receivable (excluding, for the avoidance of doubt, any Excluded Receivable), (a) all funds which are received by the Seller, any Servicer or any Originator in payment of any amounts owed in respect of such Pool Receivable (including, without limitation, purchase price, finance charges, value added taxes, interest and all other charges), or applied to amounts owed in respect of such Pool Receivable (including, without limitation, insurance payments and net proceeds of the sale or other disposition of repossessed goods or other collateral or property of the related Obligor or any other Person directly or indirectly liable for the payment of such Pool Receivable and available to be applied thereon), (b) all Collections deemed to have been received pursuant to Section 1.4(e) of the Agreement and (c) all other proceeds of such Pool Receivable.

“ Commitment Fee ” has the meaning set forth in the Fee Letter.

“ Commitment Fee Rate ” has the meaning set forth in the Fee Letter.

“ Company Note ” shall have the meaning given thereto in each Sale Agreement.

“ Concentration Component ” means, on any day, the greater of (i) the product of (a) the Base Concentration Limit, multiplied by (b) 5, or (ii) the sum of the Obligor Concentration Limits for the largest five (5) Group E Obligors.

“ Contract ” means, with respect to any Receivable, any and all contracts, understandings, instruments, agreements, invoices, notes, purchase orders or other writings (including an agreement evidenced by a purchase order or similar document) pursuant to or under which an Obligor becomes or is obligated to make payment in respect of such Receivable.

“ Contractual Dilution ” means any Dilution that is contractually limited prior to the sale or contribution to the Seller, pursuant to each Sale Agreement, of the Receivable(s) that gave rise to such Dilution, such as discounts or rebates.

“ Corporate Services Agreement ” means the corporate services agreement dated on or about the date hereof between the Seller and the Corporate Services Provider.

“ Corporate Services Provider ” means Wilmington Trust (SP) Services Dublin Limited.

“ CP Rate ” for any Yield Period for any Portion of Investment of the Participation means, to the extent the Purchaser funds such Portion of Investment for such Yield Period by issuing Notes, a rate per annum equal to the sum of (a) the weighted average of the rates paid or payable by the Purchaser from time to time as interest on or otherwise (by means of interest rate hedges or otherwise) in respect of Notes and allocated, in whole or in part, by the Agent to fund the purchase or maintenance of a Portion of Investment (and which may also be allocated in part to the funding of other assets of the Purchaser) during the relevant Yield Period, provided that if any component of such rate is a discount rate, then such component shall be the rate resulting from converting such discount rate to an interest-bearing equivalent rate per annum, plus (b) the per annum rate (expressed as a percentage and an interest rate equivalent and calculated based on a 360-day year) equivalent to the sum of (i) the allocable amount of any placement agent or commercial paper dealer fees incurred in connection with the issuance of Notes, plus (ii) certain customary documentation and transaction costs

 

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associated with the issuance of Notes, plus (iii) any incremental carrying costs incurred with respect to Notes maturing on dates other than those on which corresponding funds are received by the Purchaser, plus (iv) other borrowings by the Purchaser, including borrowings to fund small or odd Euro (€) amounts that are not easily accommodated in the commercial paper market ( provided that the rate contemplated by this clause (iv) shall not exceed the EURIBOR Rate plus fifty basis points (0.50%)). Notwithstanding anything to the contrary in the Agreement or in any other Transaction Document on and after the occurrence and during the continuation of any Termination Event the “CP Rate” shall be equal to the Base Rate plus two percent (2%)  per annum .

“ Credit Agreement ” means the Amended and Restated Credit Agreement dated as of December 16, 2005 among JDI, JohnsonDiversey Holdings, Inc., the lenders and issuers party thereto, and Citicorp USA, Inc., as Administrative Agent, as amended and in effect on the Closing Date, without giving effect to any subsequent amendment, amendment and restatement, supplement or other modification thereto (except as expressly permitted in the Agreement or a Sale Agreement, as applicable).

“ Credit and Collection Policy ” means, for each Servicer, the relevant receivables credit and collection policies and practices in effect on the date of the Servicing Agreement and attached thereto as Appendix A, as modified in compliance with the Servicing Agreement.

“ Cutoff Date ” means, (a) for any Settlement Date, the final day of a preceding Calculation Period, or (b) for any other date, the Cutoff Date for the immediately preceding Settlement Date.

“ Daily Report ” shall have the meaning set forth in the Administration Agreement.

“ Debt ” means of any Person means without duplication (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person evidenced by notes, bonds, debentures or similar instruments or that bear interest, (c) all reimbursement and all obligations with respect to letters of credit, bankers’ acceptances, surety bonds and performance bonds, whether or not matured, (d) all indebtedness for the deferred purchase price of property or services, other than trade payables incurred in the ordinary course of business that are not overdue, (e) all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (f) the capitalized amount of all obligations of such Person or any of its Subsidiaries under any lease (or other arrangement conveying the right to use) of property by such Person as lessee that would be accounted for as a capital lease on a balance sheet of such Person (prepared in conformity with GAAP), as determined on a consolidated basis in conformity with GAAP, (g) all Guaranty Obligations (as defined in the Credit Agreement) of such Person, (h) all obligations of such Person to purchase, redeem, retire, defease or otherwise acquire for value any stock or stock equivalents of such Person, valued, in the case of redeemable preferred stock, at the greater of its voluntary liquidation preference and its involuntary liquidation preference plus accrued and unpaid dividends, (i) all payments that such Person would

 

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have to make in the event of an early termination on the date Debt of such Person is being determined in respect of Hedging Agreements of such Person, (j) all Debt of the type referred to above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property (including accounts and general intangibles) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness and (k) all obligations of such Person under any transaction or series of related transactions that effect the securitization of accounts, payment intangibles or other cash flow streams of a Person.

“ Defaulted Obligor ” means, at such time of determination, an Obligor of Receivables of which more than 10% are Defaulted Receivables.

“ Defaulted Receivable ” means a Receivable:

(i) as to which any payment, or part thereof, remains unpaid by the relevant Obligor for at least ninety-one (91) days from the original due date, or, if applicable, the adjusted due date, provided that any such adjustments are consistent with the relevant Credit and Collection Policy;

(ii) as to which the Obligor thereof or any other Person obligated thereon or owning any Related Security in respect thereof has suffered a Bankruptcy Event; or

(iii) that is a Charge-off.

“ Delinquent Receivable ” means a Receivable which is not a Defaulted Receivable and:

(i) as to which any payment, or part thereof, remains unpaid by the relevant Obligor for at least 61 days from the original due date therefor; or

(ii) which, consistent with the relevant Credit and Collection Policy, would be classified as delinquent.

“ Dilution ” means any non-cash credit granted to an Obligor for the purpose of reducing or canceling the Net Outstanding Balance of any Eligible Receivable of such Obligor, except to the extent that such credit is offset by the sale or contribution of an Eligible Receivable(s) to the Seller pursuant to each Sale Agreement, as part of a transfer, cancellation (of invoice, not product), replacement (of invoice, not product), correction, or any artifact of A/R tracking, or as part of a buyback/resell arrangement between such Obligor and the applicable Originator.

“ Dilution Reserve Stress Factor ” means the number two and one-quarter (2.25).

 

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“ Discount ” means:

(i) for the Portion of Investment of the Participation for any Yield Period to the extent the Purchaser is funding such Portion of Investment through the issuance of Notes,

CPR x I x (ED/360) + TF

(ii) for the Portion of Investment of the Participation for any Yield Period to the extent the Purchaser is funding such Portion of Investment pursuant to the Liquidity Agreement or other than through the issuance of Notes,

BR x I x (ED/Year)+ TF

where: