<PAGE>
EXHIBIT 10.3
EXECUTION COPY
RECEIVABLES PURCHASE AGREEMENT
Dated as of December 30, 2003
among
NIPSCO RECEIVABLES CORPORATION
as the Seller
and
CAFCO,
LLC
as the Conduit Purchaser
and
CITIBANK, N.A.,
and
DANSKE BANK A/S, CAYMAN ISLANDS BRANCH
as the Bank Purchasers
and
CITICORP NORTH AMERICA, INC.
as the Agent
and
NORTHERN INDIANA PUBLIC SERVICE COMPANY
as the Servicer
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS.................................................................
1
SECTION 1.01 Certain
Defined Terms...........................................
1
SECTION 1.02 Other
Terms.....................................................
22
ARTICLE II AMOUNTS AND TERMS OF THE
PURCHASES.........................................
22
SECTION 2.01 Purchase
Facility...............................................
22
SECTION 2.02 Making
Purchases................................................
23
SECTION 2.03
Receivable Interest Computation.................................
24
SECTION 2.04
Settlement Procedures...........................................
25
SECTION 2.05 Payment
of Certain Fees.........................................
28
SECTION 2.06 Payments
and Computations, Etc..................................
28
SECTION 2.07 Dividing
or Combining Receivable Interests......................
29
SECTION 2.08 Increased
Costs.................................................
29
SECTION 2.09
Taxes...........................................................
30
SECTION 2.10 Security
Interest...............................................
31
ARTICLE III CONDITIONS OF
PURCHASES...................................................
32
SECTION 3.01
Conditions Precedent to Initial Purchase........................
32
SECTION 3.02
Conditions Precedent to All Purchases and Reinvestments.........
33
ARTICLE IV REPRESENTATIONS AND
WARRANTIES.............................................
34
SECTION 4.01
Representations and Warranties of the Seller....................
34
SECTION 4.02
Representations and Warranties of the Servicer..................
37
ARTICLE V
COVENANTS...................................................................
38
SECTION 5.01 Covenants
of the Seller.........................................
38
SECTION 5.02 Agreed
Upon Procedures..........................................
45
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ARTICLE VI ADMINISTRATION AND COLLECTION OF
RECEIVABLES...............................
46
SECTION 6.01
Designation of Servicer.........................................
46
SECTION 6.02 Duties of
Servicer..............................................
46
SECTION 6.03 Certain
Rights of the Agent.....................................
48
SECTION 6.04 Rights
and Remedies.............................................
49
SECTION 6.05 Covenants
of the Servicer.......................................
50
SECTION 6.06
Indemnities by the Servicer.....................................
50
SECTION 6.07 Cash
Collateral Account.........................................
51
ARTICLE VII EVENTS OF
TERMINATION.....................................................
53
SECTION 7.01 Events of
Termination...........................................
53
ARTICLE VIII THE
AGENT................................................................
55
SECTION 8.01
Authorization and Action........................................
55
SECTION 8.02 Agent's
Reliance, Etc...........................................
55
SECTION 8.03 CNAI and
Affiliates.............................................
56
SECTION 8.04
Indemnification of Agent........................................
56
SECTION 8.05
Delegation of Duties............................................
56
SECTION 8.06 Action or
Inaction by Agent.....................................
56
SECTION 8.07 Notice of
Events of Termination; Action by Agent................
57
SECTION 8.08
Non-Reliance on Agent and Other Parties.........................
57
SECTION 8.09
Successor
Agent.................................................
57
ARTICLE IX
INDEMNIFICATION............................................................
58
SECTION 9.01
Indemnities by the Seller.......................................
58
ARTICLE X
MISCELLANEOUS...............................................................
60
SECTION 10.01 No
Waiver; Amendments, Etc.....................................
60
SECTION 10.02 Notices,
Etc...................................................
61
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SECTION 10.03
Assignability..................................................
61
SECTION 10.04 Costs
and Expenses.............................................
63
SECTION 10.05 No
Proceedings.................................................
63
SECTION 10.06
Confidentiality................................................
63
SECTION 10.07
GOVERNING LAW..................................................
64
SECTION 10.08
Execution in Counterparts......................................
64
SECTION 10.09
Integration; Binding Effect; Survival of Termination...........
64
SECTION 10.10 Consent
to Jurisdiction........................................
65
SECTION 10.11 WAIVER
OF JURY TRIAL...........................................
65
SECTION 10.12 Ratable
Payments...............................................
65
SECTION 10.13
Limitation of Liability........................................
65
SECTION 10.14 Intent
of the Parties..........................................
66
SECTION 10.15 Release
Upon Termination.......................................
66
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SCHEDULES
SCHEDULE I -
Blocked
Account Banks
SCHEDULE II - Credit and
Collection Policy
SCHEDULE III - Special
Concentration Limits
ANNEXES
ANNEX A
- Form of
Monthly Report
ANNEX B
- Form of
Blocked Account Agreement
ANNEX C
- Form of
Assignment and Acceptance
ANNEX D
- Form of
Funds Transfer Letter
ANNEX E
- Forms of
Termination Agreements
ANNEX F
- Forms of
Contracts
ANNEX G
- Form of
Cash Collateral Agreement
ANNEX H
Additional Representations and Warranties of the Seller
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RECEIVABLES PURCHASE AGREEMENT
Dated as of December 30, 2003
THIS RECEIVABLES PURCHASE AGREEMENT (this "Agreement") is
entered into as of December 30, 2003 by and
among (i) NIPSCO RECEIVABLES
CORPORATION, an Indiana corporation, as
Seller, (ii) CAFCO, LLC, a Delaware
limited liability company, as Conduit
Purchaser, (iii) CITIBANK, N.A. (together
with any successor thereto, "Citibank") and
Danske Bank A/S, Cayman Islands
Branch (together with any successor
thereto, "Danske"), each as a Bank
Purchaser, (iv) CITICORP NORTH AMERICA,
INC., a Delaware corporation (together
with any successor thereto, "CNAI"), as
Agent for the Conduit Purchaser and the
Bank Purchasers, and (v) NORTHERN INDIANA
PUBLIC SERVICE COMPANY, an Indiana
corporation, as Servicer.
PRELIMINARY STATEMENTS. The Seller has acquired, and may
continue to acquire, Receivables from
NIPSCO, either by purchase or by
contribution to the capital of the Seller.
The Seller is prepared to sell
undivided fractional ownership interests
(referred to herein as "Receivable
Interests") in the Receivables. The Conduit
Purchaser may, in its sole
discretion, purchase such Receivable
Interests, and the Bank Purchasers have
agreed to purchase such Receivable
Interests, in each case on the terms and
conditions set forth herein. Accordingly,
the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Certain Defined Terms. As used in this Agreement,
the following terms shall have the
following meanings (such meanings to be
equally applicable to both the singular and
plural forms of the terms defined):
"Accounting Based Consolidation Event" means the
consolidation, for financial and/or
regulatory accounting purposes, of all or
any portion of the assets and liabilities
of the Conduit Purchaser that are the
subject of this Agreement or any other
Transaction Document with all or any
portion of the assets and liabilities of
Citibank or the Agent or any of their
affiliates as the result of the existence
of, or occurrence of any change in,
accounting standards or the issuance of any
pronouncement, interpretation or
release, including, without limitation, the
Financial Accounting Standards Board
Interpretation No. 46, by any accounting
body or any other body charged with the
promulgation or administration of
accounting standards, including, without
limitation, the Financial Accounting
Standards Board, the International
Accounting Standards Board, the American
Institute of Certified Public
Accountants, the Federal Reserve Board of
Governors and the Securities and
Exchange Commission, and shall occur as of
the date that such consolidation (i)
shall have occurred with respect to the
financial statements of Citibank or the
Agent or any of their affiliates or (ii)
shall have been required to have
occurred, regardless of whether such
financial statements were prepared as of
such date.
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"Adjusted Eurodollar Rate" means, for any Fixed Period, an
interest rate per annum obtained by
dividing (i) the Eurodollar Rate for such
Fixed Period by (ii) a percentage equal to
100% minus the Eurodollar Rate
Reserve Percentage for such Fixed
Period.
"Adverse Claim" means a lien, security interest or other
charge or encumbrance, or other right or
claim in, of or on any asset or
property of a Person in favor of another
Person.
"Affected Person" has the meaning specified in Section 2.08.
"Affiliate" means, for any Person, any other Person which (i)
is a Subsidiary of such Person or (ii)
directly or indirectly, is in control of,
is controlled by, or is under common
control with such Person. For purposes of
this definition, "control" means the power,
directly or indirectly, to cause the
direction of the management and policies of
a Person, whether through ownership
of voting securities, by contract or
otherwise.
"Agent" means CNAI, in its capacity as contractual
representative for the Conduit Purchaser
and Bank Purchasers hereunder, and any
successor thereto in such capacity
appointed pursuant to Article VIII.
"Agent's Account" means the special account (account number
4063-6695) of the Agent maintained at the
office of Citibank at 399 Park Avenue,
New York, New York or such other account as
the Agent shall designate in writing
to the Seller and the Servicer.
"Aggregate Commitment" means, at any time, the total of the
Commitments of all Bank Purchasers at such
time.
"Alternate Base Rate" means a fluctuating interest rate per
annum as shall be in effect from time to
time, which rate shall at all times be
equal to the higher of:
(a) the rate
of interest announced publicly by
Citibank in New York, New York, from time to time as
Citibank's base rate; and
(b) the
Federal Funds Rate plus 0.50%.
"Amortization Date" means, for any Receivable Interest, (i) in
the case of a Receivable Interest owned by
the Conduit Purchaser, the earlier of
(a) the Business Day which the Seller or
the Agent so designates by notice to
the other at least one Business Day in
advance and (b) the Termination Date and
(ii) in the case of a Receivable Interest
owned by a Bank Purchaser, the earlier
of (a) the Business Day which the Seller so
designates by notice to the Agent at
least five Business Days in advance and (b)
the Termination Date.
"Applicable Eurodollar Rate Margin" means a rate per annum
equal to (i) 0.95% during a Level 1 Ratings
Period, Level 2 Ratings Period or
Level 3 Ratings Period, (ii) 1.25% during
any period of time (other than a Level
1 Ratings Period, a Level 2 Ratings Period
or a Level 3 Ratings Period) during
which NIPSCO's Debt Rating has not been
withdrawn by either S&P or Moody's and
is no less than BB+ by S&P and Ba1 by
Moody's, and (iii) 1.75% at any period of
time during which NIPSCO's Debt Rating has
been withdrawn by either S&P or
Moody's or is less than BB+ by S&P or
Ba1 by Moody's.
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"Asset Purchase Agreement" means any secondary market
agreement, asset purchase agreement or
other liquidity agreement entered into by
one or more Bank Purchasers for the benefit
of the Conduit Purchaser, to the
extent relating to the sale or transfer of
interests in, or other financing of,
Receivable Interests.
"Assignee
Rate" means, for any Fixed Period for any Receivable
Interest, an interest rate per annum equal
to the sum of the Applicable
Eurodollar Rate Margin plus the Adjusted
Eurodollar Rate for such Fixed Period;
provided, however, that in case of:
(i) any Fixed
Period on or prior to the first
day of which the Conduit Purchaser or Bank Purchaser shall
have notified the Agent that the introduction of or any change
in, or in the interpretation of, any law or regulation makes
it unlawful, or any central bank or other governmental
authority asserts that it is unlawful, for the Conduit
Purchaser or such Bank Purchaser to fund such Receivable
Interest at the Assignee Rate set forth above (and the Conduit
Purchaser or such Bank Purchaser shall not have subsequently
notified the Agent that such circumstances no longer exist),
(ii)
any Fixed Period of less than one month,
(iii) any
Fixed Period as to which the Agent does
not receive notice, by no later than 12:00 noon (New York City
time) on the third Business Day preceding the first day of
such Fixed Period, that the related Receivable Interest will
not be funded by the issuance of commercial paper, or
(iv)
any Fixed Period for a
Receivable Interest
the Capital of which allocated to the Conduit Purchaser or a
Bank Purchaser is less than $500,000,
the Assignee Rate for such Fixed Period for
the affected Conduit Purchaser or
Bank Purchaser shall be an interest rate
per annum equal to the Alternate Base
Rate in effect from time to time during
such Fixed Period; and provided further
that at all times following the occurrence
and during the continuation of an
Event of Termination the Assignee Rate
shall be an interest rate per annum equal
to the Alternate Base Rate in effect from
time to time plus 2%.
"Assignment and Acceptance" means an assignment and acceptance
agreement entered into by a Bank Purchaser,
an Eligible Assignee and the Agent,
pursuant to which such Eligible Assignee
may become a party to this Agreement,
in substantially the form of Annex C
hereto.
"Balanced Payment Plan" means a balanced or levelized payment
plan of the Originator made available to an
Obligor.
"Bank Purchasers" means Citibank, Danske and each Eligible
Assignee that shall become a party to this
Agreement pursuant to Section 10.03.
"Blocked Account" means an account maintained at a bank for
the purpose of receiving Collections, with
respect to which account a Blocked
Account Agreement has been executed.
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"Blocked Account Agreement" means an agreement, in
substantially the form of Annex B (or in
such other form as may be approved in
writing by the Agent) duly executed by the
Seller, the Originator, the Agent and
a Blocked Account Bank.
"Blocked Account Bank" means any bank at which a Blocked
Account is maintained.
"Business Day" means any day on which (i) banks are not
authorized or required to close in New York
City, New York and (ii) if this
definition of "Business Day" is utilized in
connection with the Eurodollar Rate,
dealings are carried out in the London
interbank market.
"CAFCO" means CAFCO, LLC, a Delaware limited liability
company, together with its successors and
permitted assigns.
"Capital" of any Receivable Interest means the original amount
paid to the Seller for such Receivable
Interest at the time of its purchase by a
Purchaser pursuant to this Agreement, as
such amount may be divided or combined
in accordance with Section 2.07, in each
case as reduced from time to time by
Collections received by such Purchaser from
distributions made pursuant to
Section 2.04 on account of such Capital
held by such Purchaser; provided that if
such Capital shall have been reduced by any
distribution and thereafter all or a
portion of such distribution is rescinded
or must otherwise be returned for any
reason, such Capital shall be increased by
the amount of such rescinded or
returned distribution, as though it had not
been received by such Purchaser.
"Cash Collateral Account" has the meaning specified in Section
6.07.
"Cash Collateral Agreement" has the meaning specified in
Section 6.07.
"Cash Collateral Bank" has the meaning specified in Section
6.07.
"Citibank" has the meaning specified in the preamble.
"CNAI" has the meaning specified in the preamble.
"Collections" means, with respect to any Receivable, all cash
collections and other cash proceeds of such
Receivable, including, without
limitation, all cash proceeds of Related
Security with respect to such
Receivable, and any collection of such
Receivable deemed to have been received
pursuant to Section 2.04(e), but excluding
amounts received from any Obligor
under a Balanced Payment Plan to the extent
constituting a prepayment for goods
or services not yet provided to such
Obligor.
"Commitment" of any Bank Purchaser means, (a) with respect to
Citibank, $75,000,000; (b) with respect to
Dankse, $75,000,000 and (c) with
respect to any other Bank Purchaser that
has entered into an Assignment and
Acceptance, the amount set forth therein as
such Bank Purchaser's Commitment, in
each case as such amount may be reduced or
increased by any Assignment and
Acceptance entered into among such Bank
Purchaser, an Eligible Assignee and the
Agent and, in each case, as such amount may
be reduced (or terminated) pursuant
to the terms of this Agreement. Any
reduction (or termination) of the Program
Limit
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pursuant to the terms of this Agreement
below the amount of the Aggregate
Commitment shall reduce (or terminate) each
Bank Purchaser's Commitment ratably
in accordance with their respective
Commitments.
"Concentration Account" means the special account (account
number 628215570) of the Originator
maintained at Bank One, N.A., at its offices
at 1 Bank One Plaza, Chicago, Illinois
60670.
"Concentration Limit" means, for any Obligor at any time, 3.0%
of the Net Receivables Pool Balance (the
"Normal Concentration Limit"), or such
other percentage of the Net Receivables
Pool Balance (a "Special Concentration
Limit") as is set forth on Schedule III, or
otherwise agreed to by the Seller
and the Agent and designated by the Agent
(subject to Section 10.01) in a
writing delivered to the Seller; provided
that in the case of an Obligor and its
Affiliates, the Concentration Limit shall
be calculated as if such Obligor and
such Affiliates were a single Obligor; and
provided further that the Agent may
reduce any Special Concentration Limit upon
three Business Days' notice to the
Seller.
"Conduit Purchaser" means CAFCO and any other Eligible
Assignee that becomes an owner by
assignment or otherwise of a Receivable
Interest originally purchased by CAFCO and,
to the extent of the undivided
interests so purchased, shall include any
Eligible Assignees that become
participants.
"Consolidated Subsidiary" means at any date, any Subsidiary
the accounts of which are consolidated with
those of NIPSCO in its consolidated
financial statements as of such date.
"Consolidation Fee" has the meaning set forth in Section
2.05(b).
"Contract" means each of the tariffs pursuant to which the
Originator shall provide gas or electricity
to customers from time to time and
pursuant to which rates payable by such
Customers for gas or electricity are
set, in one of the forms set forth in Annex
F.
"CP Fixed Period Date" means, for any Receivable Interest held
by the Conduit Purchaser, the date of
purchase of such Receivable Interest and
thereafter the 18th day of each calendar
month or any other day as shall have
been agreed to in writing by the Agent and
the Seller prior to the last Business
Day of the preceding Fixed Period for such
Receivable Interest or, if there is
no preceding Fixed Period, prior to the
date of purchase of such Receivable
Interest.
"CP Rate" means, for any Fixed Period for any Receivable
Interest, to the extent the Conduit
Purchaser funds such Receivable Interest for
such Fixed Period by issuing commercial
paper, the per annum rate equivalent to
the weighted average of the per annum rates
paid or payable by the Conduit
Purchaser from time to time as interest on
or otherwise (by means of interest
rate hedges or otherwise) in respect of
those promissory notes issued by the
Conduit Purchaser that are allocated, in
whole or in part, by the Agent (on
behalf of the Conduit Purchaser) to fund
the purchase or maintenance of such
Receivable Interest during such Fixed
Period as determined by the Agent (on
behalf of the Conduit Purchaser) and
reported to the Seller and the Servicer,
which rates shall reflect and give effect
to the commissions of placement
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agents and dealers in respect of such
promissory notes, to the extent such
commissions are allocated, in whole or in
part, to such promissory notes by the
Agent (on behalf of the Conduit Purchaser);
provided, however, that if any
component of such rate is a discount rate,
in calculating the "CP Rate" for such
Fixed Period the Agent shall for such
component use the rate resulting from
converting such discount rate to an
interest bearing equivalent rate per annum.
"Credit and Collection Policy" means those receivables credit
and collection policies and practices of
NIPSCO in effect on the date of this
Agreement and described in Schedule II
hereto, as modified in compliance with
this Agreement.
"Danske" has the meaning specified in the preamble.
"Debt"
means, as to any Person, at any date, without
duplication, (i) all obligations of such
Person for borrowed money, (ii) all
obligations of such Person evidenced by
bonds, debentures, notes or other
similar instruments, (iii) all obligations
of such Person to pay the deferred
purchase price of property or services,
(iv) all obligations of such Person as
lessee under capital leases, (v) all Debt
of others secured by an Adverse Claim
on any asset of such Person, whether or not
such Debt is assumed by such Person,
(vi) all Debt of others Guaranteed by such
Person and (vii) all obligations of
such Person in respect of unfunded vested
benefits under plans covered by Title
IV of ERISA.
"Debt Rating" for any Person, shall mean the rating by S&P
or
Moody's of such Person's long-term public
senior unsecured non-credit-enhanced
debt.
"Default Ratio" means the ratio (expressed as a percentage)
computed as of the last day of each
calendar month by dividing (i) the aggregate
Outstanding Balance of all Receivables that
were Defaulted Receivables on such
day or that would have been Defaulted
Receivables on such day had they not been
written off the books of the Originator or
the Seller during such month by (ii)
the aggregate Outstanding Balance of all
Receivables on such day.
"Defaulted Receivable" means a Receivable:
(i) as to
which a Final Bill has been mailed or
otherwise transmitted to the Obligor thereof;
(ii)
as to which the Obligor thereof or any other
Person obligated thereon has taken any action, or suffered any
event to occur, of the type described in Section 7.01(f); or
(iii)
which consistent with the Credit and
Collection Policy, would be written off the Seller's books as
uncollectible.
"Deferred Purchase Price" has the meaning specified in the
Sale Agreement.
"Delinquent Receivable" means a Receivable that is not a
Defaulted Receivable and:
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(i) as to
which any payment, or part thereof,
remains unpaid for 31 or more days from the original due date
for such payment; or
(ii)
which, consistent with the Credit and
Collection Policy, would be classified as delinquent by the
Seller.
"Deposit Date" means each day on which any Collections are
deposited in any of the Blocked Accounts or
on which any Transaction Party shall
receive Collections of Pool
Receivables.
"Designated Obligor" means, at any time, any Obligor of any
Receivable, unless the Agent has provided
the Seller with three Business Days'
prior notice that such Obligor shall not be
considered a Designated Obligor.
"Diluted Receivable" means that portion of any Receivable
which is either (a) reduced or canceled as
a result of (i) any defective,
rejected or returned merchandise or
services or any failure by any Transaction
Party to deliver any merchandise or goods
or provide any services or otherwise
to perform under any related Contract,
order or invoice, (ii) any change in the
terms of, or cancellation of, a Contract or
invoice or any cash discount,
discount for quick payment or other
adjustment by any Transaction Party which
reduces the amount payable by the Obligor
on the related Receivable or (iii) any
set-off by an Obligor in respect of any
claim by such Obligor (whether such
claim arises out of the same or a related
transaction or an unrelated
transaction), or (b) subject to any
specific offset, counterclaim or defense
whatsoever (except the discharge in
bankruptcy of the Obligor thereof).
"Dollars" and "$" each mean the lawful currency of the United
States of America.
"Dynamic Loss Reserve" means, on any date, the product of (i)
the applicable Stress Factor, (ii) the Loss
Horizon Ratio for the calendar month
then most recently ended and (iii) the
Maximum Loss Ratio.
"Eligible Assignee" means, (i) CNAI or any of its Affiliates,
(ii) any Person managed by Citibank, CNAI
or any of their respective Affiliates
and rated at least A-1 by S&P and P-1
by Moody's, (iii) any Purchaser hereunder
or (iv) any financial or other institution
acceptable to the Agent.
"Eligible Receivable" means, at any time, a Receivable that
satisfies all of the following
criteria:
(a) such
Receivable arose from the sale of goods
and/or provision of services by the Originator in the ordinary
course of business;
(b) such
Receivable constitutes an "account" as
defined in Article 9 of the UCC as in effect in the State of
New York;
(c) the
Obligor of such Receivable (i) is a
United States resident, (ii) is not an Affiliate of any
Transaction Party, and (iii) is a Designated Obligor;
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(d) such
Receivable is denominated and payable
only in Dollars in the
United States;
(e) the sale
or granting of a security interest
in such Receivable does not contravene or conflict with any
law, rule or regulation or require the consent or approval of,
or notice to, the related Obligor or any other Person;
(f) such
Receivable arises under a Contract that
has been duly authorized and that, together with such
Receivable, is in full force and effect and constitutes the
legal, valid and binding obligation of the Obligor of such
Receivable enforceable against such Obligor in accordance with
its terms and is not subject to any dispute, offset,
counterclaim or defense whatsoever (except the discharge in
bankruptcy of such Obligor;)
(g) such
Receivable, together with the Contract
related thereto, does not contravene in any material respect
any laws, rules or regulations applicable thereto (including,
without limitation, laws, rules and regulations relating to
usury, truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection
practices and privacy) and no party to the Contract related
thereto is in violation of any such law, rule or regulation in
any material respect;
(h) such
Receivable satisfies all applicable
requirements of the Credit and Collection Policy and such
other criteria and requirements (other than those relating to
the collectibility of such Receivable) as the Agent may from
time to time specify to the Seller upon 30 days' notice;
(i) the
Contract related to the Receivable
requires that the full payment of such Receivable be made
within 30 days of the original billing date;
(j) the
representations and warranties set forth
in
Section 4.01(h) of this Agreement and Section 4.01(j) of
the Sale Agreement, are true and correct with respect to such
Receivable;
(k) such
Receivable arises under a Contract,
which (i) does not contain a provision that requires the
Obligor thereunder to consent to the sale or assignment of the
rights of the Seller or the Originator thereunder in the
manner contemplated by the Transaction Documents and (ii) does
not contain a confidentiality provision that would restrict
the ability of the Agent or the Purchasers to exercise their
rights under this Agreement, including, without limitation,
their right to review invoices delivered pursuant to such
Contract;
(l) the Agent
has not notified the Seller prior
to the applicable date of purchase that the Agent has
determined, in its sole discretion, that such Receivable (or
class of Receivables) may not be treated as an "Eligible
Receivable" hereunder;
-8-
<PAGE>
(m) such
Receivable is not a Defaulted
Receivable or a Delinquent Receivable; and the Obligor thereof
is not the Obligor of Defaulted Receivables in the aggregate
amount of 5% or more of the aggregate Outstanding Balance of
all Receivables of such Obligor;
(n) such
Receivable has not been extended,
rewritten or otherwise modified from the original terms
thereof except in accordance with the Credit and Collection
Policy;
(o) the
Originator has satisfied and fully
performed all obligations on its part with respect to such
Receivable
required to be fulfilled by it, and no further
action is required to be performed by any Person with respect
thereto other than payment thereon by the applicable Obligor;
(p) such Receivable
is an obligation
representing all or part of the sales price of merchandise or
services within the meaning of Section 3(c)(5) of the
Investment Company Act of 1940, as amended, and a purchase of
such Receivable with the proceeds of notes would constitute a
"current transaction" within the meaning of Section 3(a)(3) of
the Securities Act of 1933, as amended; and
(q) such
Receivable did not arise out of the
sale at the wellhead or minehead of oil, gas or other
minerals.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the
regulations promulgated and rulings
issued thereunder.
"ERISA Affiliate" means, with respect to any Person, any (i)
corporation which is a member of the same
controlled group of corporations
(within the meaning of Section 414(b) of
the IRC) as such Person; (ii)
partnership or other trade or business
(whether or not incorporated) under
common control (within the meaning of
Section 414(c) of the IRC) with such
Person or (iii) member of the same
affiliated service group (within the meaning
of Section 414(m) of the IRC) as such
Person, any corporation described in
clause (i) above or any partnership or
other trade or business described in
clause (ii) above.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of
Governors of the Federal Reserve System, as
in effect from time to time.
"Eurodollar Rate" means, for any Fixed Period, the rate
appearing on Page 3750 of the Telerate
Service (or on any successor or
substitute page of such service, or any
successor to or substitute for such
service, providing rate quotations
comparable to those currently provided on
such page of such service, as determined by
the Agent from time to time for
purposes of providing quotations of
interest rates applicable to dollar deposits
in the London interbank market) at
approximately 11:00 A.M., London time, two
Business Days prior to the commencement of
such Fixed Period, as the rate for
dollar deposits with a maturity comparable
to such Fixed Period. In the event
that such rate is not available at such
time for any reason, then the
"Eurodollar Rate" shall be the rate at
which dollar deposits of $5,000,000 and
for a maturity comparable to such Fixed
Period are offered by the principal
London office of Citibank in
-9-
<PAGE>
immediately available funds in the London
interbank market at approximately
11:00 A.M., London time, two Business Days
prior to the commencement of such
Fixed Period, as determined by the
Agent.
"Eurodollar Rate Reserve Percentage" means, for any Fixed
Period in respect of which Yield is
computed by reference to the Eurodollar
Rate, the reserve percentage applicable two
Business Days before the first day
of such Fixed Period under regulations
issued from time to time by the Board of
Governors of the Federal Reserve System (or
any successor) (or if more than one
such percentage shall be applicable, the
daily average of such percentages for
those days in such Fixed Period during
which any such percentage shall be so
applicable) for determining the maximum
reserve requirement (including, without
limitation, any emergency, supplemental or
other marginal reserve requirement)
with respect to liabilities or assets
consisting of or including Eurocurrency
Liabilities (or with respect to any other
category of liabilities that includes
deposits by reference to which the interest
rate on Eurocurrency Liabilities is
determined) having a term equal to such
Fixed Period.
"Event of Termination" has the meaning specified in Section
7.01.
"Existing Receivables Facility" means each of the following:
(i) the Trade Receivables Purchase and Sale
Agreement dated as of May 31, 1988
among NIPSCO, as the seller, CRC Funding,
LLC (successor to Corporate
Receivables Corporation), as the investor,
Citibank and CNAI, individually and
as agent, as amended, restated,
supplemented or otherwise modified from time to
time, together with the other agreements
referred to therein, and (ii) the Trade
Receivables Purchase and Sale Agreement
dated as of May 31, 1988 among NIPSCO,
as seller, Citibank and CNAI, individually
and as agent, as amended, restated,
supplemented or otherwise modified from
time to time, together with the other
agreements referred to therein.
"Federal Funds Rate" means, for any period, a fluctuating
interest rate per annum equal for each day
during such period to the weighted
average of the rates on overnight Federal
funds transactions with members of the
Federal Reserve System arranged by Federal
funds brokers, as published for such
day (or, if such day is not a Business Day,
for the next preceding Business Day)
by the Federal Reserve Bank of New York,
or, if such rate is not so published
for any day which is a Business Day, the
average of the quotations for such day
on such transactions received by the Agent
from three Federal funds brokers of
recognized standing selected by it
"Fees" means each of the Consolidation Fee, Program Fee and
Liquidity Fee.
"Final Bill" means, as to any account number of any Obligor,
the bill rendered with respect to such
account number upon termination of
service for any reasons, including, without
limitation, upon such Obligor's
request or for nonpayment by such
Obligor.
"Financial Officer" of any Person means, the chief financial
officer, principal accounting officer,
treasurer or assistant treasurer of such
Person.
"Fixed Period" means, with respect to any Receivable Interest:
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<PAGE>
(a) in the
case of any Fixed Period in respect of which
Yield is computed by reference to the CP
Rate or the Alternate Base Rate, each
successive period of one month, ending on
each Settlement Date; and
(b) in the
case of any Fixed Period in respect of which
Yield is computed by reference to the
Adjusted Eurodollar Rate, each successive
period of one month, ending on each CP
Fixed Period Date provided that a notice
shall have been given by the Seller and
received by the Agent (including notice
by telephone, confirmed in writing) not
later than 11:00 A.M. (New York City
time) on the day which occurs three
Business Days before the first day of such
Fixed Period, each such Fixed Period for
such Receivable Interest to commence on
the last day of the immediately preceding
Fixed Period for such Receivable
Interest (or, if there is no such Fixed
Period, on the date of purchase of such
Receivable Interest), except that if the
Agent shall not have received such
notice before 11:00 A.M. (New York City
time) on such day, such Fixed Period
shall be one day; provided, however,
that:
(i) any Fixed
Period (other than of one day)
which would otherwise
end on a day which is not a Business Day
shall be extended to the next succeeding Business Day
(provided, however, that if Yield in respect of such Fixed
Period is computed by reference to the Eurodollar Rate, and
such Fixed Period would otherwise end on a day which is not a
Business Day, and there is no subsequent Business Day in the
same calendar month as such day, such Fixed Period shall end
on the next preceding Business Day);
(ii)
in the case of any Fixed Period of one day,
(A) if such Fixed Period is the initial Fixed Period for a
Receivable Interest, such Fixed Period shall be the day of the
purchase of such Receivable Interest; (B) any subsequently
occurring Fixed Period which is one day shall, if the
immediately preceding Fixed Period is more than one day, be
the last day of such immediately preceding Fixed Period and,
if the immediately preceding Fixed Period is one day, be the
day next following such immediately preceding Fixed Period;
and (C) if such Fixed Period occurs on a day immediately
preceding a day which is not a Business Day, such Fixed Period
shall be extended to the next succeeding Business Day; and
(iii) in
the case of any Fixed Period for any
Receivable Interest which commences before the Amortization
Date for such Receivable Interest and would otherwise end on a
date occurring after such Amortization Date, such Fixed Period
shall end on such Amortization Date and the duration of each
Fixed Period which commences on or after the Amortization Date
for such Receivable Interest shall be of such duration
(including, without limitation, one day) as shall be selected
by the Agent.
"Funds Transfer Letter" means a letter in substantially the
form of Annex D hereto executed and
delivered by the Seller to the Agent, as the
same may be amended or restated in
accordance with the terms thereof.
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<PAGE>
"Guarantee" means, as to any Person, any obligation,
contingent or otherwise, of such Person
directly or indirectly guaranteeing any
Debt or other obligation of any other
Person and, without limiting the
generality of the foregoing, any
obligation, direct or indirect, contingent or
otherwise, of such Person (i) to purchase
or pay (or advance or supply funds for
the purchase or payment of) such Debt or
other obligation (whether arising by
virtue of partnership arrangements, by
agreement to keep-well, to purchase
assets, goods, securities or services, to
take-or-pay, or to maintain financial
statement conditions or otherwise) or (ii)
entered into for the purpose of
assuring in any other manner the obligee of
such Debt or other obligation of the
payment thereof or to protect such obligee
against loss in respect thereof (in
whole or in part), provided that the term
"Guarantee" shall not include
endorsements for collection or deposit in
the ordinary course of business. The
term "Guarantee" used as a verb has a
corresponding meaning.
"Incipient Event of Termination" means an event that but for
notice or lapse of time or both would
constitute an Event of Termination.
"Indemnified Amounts" has the meaning specified in Section
10.01.
"Indemnified Party" has the meaning specified in Section
10.01.
"Investor Rate" means, for any Fixed Period for any Receivable
Interest held by the Conduit Purchaser (a)
to the extent the Conduit Purchaser
funds such Receivables Interest for such
Fixed Period by issuing commercial
paper, the CP Rate; and (b) to the extent
the Conduit Purchaser funds such
Receivables Interest for such Fixed Period
other than by issuing commercial
paper, (i) a rate equal to the Assignee
Rate or (ii) such other rate as the
Agent and the Seller shall agree in
writing.
"Involuntary Bankruptcy Event" means the occurrence of an
event that, but for notice or lapse of time
or both, would constitute such an
Event of Termination of the type described
in Section 7.01(f).
"IRC" means the Internal Revenue Code of 1986, as amended from
time to time, and any successor
statute.
"Level 1 Ratings Period" means any period of time during which
NIPSCO's Debt Rating has not been withdrawn
by either S&P or Moody's and is no
less than (i) BBB+ by S&P and (ii) Baa1
by Moody's.
"Level 2 Ratings Period" means any period of time (other than
a Level 1 Ratings Period) during which
NIPSCO's Debt Rating has not been
withdrawn by either S&P or Moody's and
is no less than (i) BBB by S&P and (ii)
Baa2 by Moody's.
"Level 3 Ratings Period" means any period of time (other than
a Level 1 Ratings Period or a Level 2
Ratings Period) during which NIPSCO's Debt
Rating has not been withdrawn by either
S&P or Moody's and is no less than (i)
BBB- by S&P and (ii) Baa3 by
Moody's.
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<PAGE>
"Level 4 Ratings Period" means any period of time during which
NIPSCO's Debt Rating has been withdrawn by
either S&P or Moody's or is less than
(i) BBB- by S&P or (ii) Baa3 by
Moody's.
"Liquidation Day" means, for any Receivable Interest, (i) each
day during a Fixed Period for such
Receivable Interest on which the conditions
set forth in Section 3.02 are not satisfied
(and such failure of conditions is
not waived by the Agent), and (ii) each day
which occurs on or after the
Amortization Date for such Receivable
Interest (including, without limitation,
each day during the Liquidation
Period).
"Liquidation Fee" means, for (i) any Fixed Period for which
Yield is computed by reference to the
Investor Rate and a reduction of Capital
is made for any reason (x) on a Settlement
Date, if the Agent shall have
received less than three Business Days'
notice of such reduction and the amount
of such reduction is greater than
$75,000,000 or (y) in any amount on any day
other than a Settlement Date or (ii) any
Fixed Period for which Yield is
computed by reference to the Eurodollar
Rate and a reduction of Capital is made
for any reason on any day other than the
last day of such Fixed Period, the
amount, if any, by which (A) the additional
Yield (calculated without taking
into account any Liquidation Fee or any
shortened duration of such Fixed Period
pursuant to clause (iii) of the definition
thereof) which would have accrued
during such Fixed Period (or, in the case
of clause (i) above, until the
maturity of the underlying commercial paper
tranches) on the reductions of
Capital of the Receivable Interest relating
to such Fixed Period had such
reductions remained as Capital, exceeds (B)
the income, if any, received by the
Conduit Purchaser or the Bank Purchaser
which holds such Receivable Interest
from the investment of the proceeds of such
reductions of Capital.
"Liquidation Period" means the period commencing on the day
following the last day of the Revolving
Period and ending on the later of the
Termination Date and the date on which no
Capital of or Yield on any Receivable
Interest shall be outstanding and all other
Seller Obligations shall be paid in
full.
"Liquidity Commitment" means, (a) with respect to Citibank,
$125,000,000 (b) with respect to Danske,
$75,000,000 and (c) with respect to any
other Bank Purchaser that has entered into
an Asset Purchase Agreement, the
amount set forth therein as such Bank
Purchaser's maximum purchase amount, in
each case as such amount may be reduced or
increased by any Assignment and
Acceptance entered into among such Bank
Purchaser, an Eligible Assignee and the
Agent or any assignment in accordance with
any Asset Purchase Agreement, and, in
each case, as such amount may be reduced
(or terminated) pursuant to the terms
of this Agreement or the related Asset
Purchase Agreement.
"Liquidity Fee" means, with respect to each Fixed Period, a
fee payable on each Settlement Date to the
Agent, for the benefit of the Bank
Purchasers, equal to:
LFR x C x ED
---
360
where:
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<PAGE>
LFR = the Liquidity Fee Rate for such
Fixed Period
C =
the greater of (i) the
Aggregate Commitment or (ii)
the aggregate Capital of all Receivable Interests
during such Fixed Period
ED =
the actual number of
days elapsed during such Fixed
Period
The Liquidity Fee shall be allocated to the Bank Purchasers
ratably in accordance with their respective
Commitments; provided, however, that
if the aggregate Capital of all Receivable
Interests during such Fixed Period
exceeds the Aggregate Commitment, that
portion of the Liquidity Fee payable on
or as a result of such excess shall be paid
solely to Citibank.
"Liquidity Fee Rate" means a rate per annum equal to (i) 0.25%
during any Level 1 Ratings Period or any
Level 2 Ratings Period; (ii) 0.325%
during any Level 3 Ratings Period or (iii)
0.50% during any Level 4 Ratings
Period.
"Loss Horizon Ratio" means a ratio (expressed as a percentage)
computed as of the last day of each
calendar month by dividing (i) the aggregate
original Outstanding Balance of Receivables
which arose during the three
calendar month period ending on such day by
(ii) the aggregate Outstanding
Balance of all Eligible Receivables as of
such day.
"Loss Ratio" means a ratio (expressed as a percentage)
computed as of the last day of each
calendar month (the "specified month") by
dividing (i) the sum of the aggregate
Outstanding Balances of (a) all
Receivables written-off (net of recoveries)
during the specified month, plus (b)
all Receivables as to which any payment, or
part thereof, remains unpaid for at
least 61 days, but no more than 90 days,
from the original due date therefor on
such date, plus (c) all Delinquent
Receivables in excess of 7% of the aggregate
Outstanding Balance of all billed
Receivables on such date plus (d) all
Receivables for which a Final Bill was
issued during such month, to the extent
such amount exceeds 7.5% of the aggregate
Outstanding Balance of all billed
Receivables on such date by (ii) the
aggregate original Outstanding Balance of
billed Receivables which arose during the
third calendar month immediately
preceding the specified month.
"Loss Reserve" means, on any date, an amount equal to:
LRP x NRPB
where:
LRP =
the Loss Reserve
Percentage on such date
NRPB = the Net Receivables Pool Balance
at the close of
business of the Servicer on such date
"Loss Reserve Percentage" means, on any date, the greatest of
(i) the Dynamic Loss Reserve, (ii) four
times the Normal Concentration Limit and
(iii) 12%.
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"Majority Bank Purchasers" means Bank Purchasers representing
more than 50% of the aggregate Liquidity
Commitments of all Bank Purchasers.
"Material Adverse Effect" means a material adverse effect on
(i) the ability of any Transaction Party to
perform its obligations under any
Transaction Document, (ii) the legality,
validity or enforceability of this
Agreement or any other Transaction
Document, (iii) any Purchaser's or the
Agent's interest in the Receivables
generally or in any material portion of the
Receivables, the Related Security or the
Collections with respect thereto, or
(iv) the collectibility of the Receivables
generally or of any material portion
of the Receivables.
"Maximum Loss Ratio" means, on any date, the highest
Three-Month Loss Ratio during the twelve
calendar month period then most
recently ended.
"Maximum Receivable Interest" means (i) at any time during a
Level 1 Ratings Period, 97%, (ii) at any
time during a Level 2 Ratings Period,
95%, and (iii) at any other time, 93%.
"Monthly Report" means a report in substantially the form of,
and containing the information described
in, Annex A, and such additional
information as the Agent may reasonably
request from time to time, duly
completed and furnished by the Servicer to
the Agent and each Bank Purchaser
pursuant to Section 6.02(g).
"Moody's" means Moody's Investors Service, Inc.
"Net Receivables Pool Balance" means at any time the aggregate
Outstanding Balance of Pool Receivables
that are Eligible Receivables reduced by
the sum of (i) the aggregate amount by
which the Outstanding Balance of Eligible
Receivables of each Obligor (treating each
Obligor and its Affiliates as if they
were a single Obligor) exceeds the
Concentration Limit for such Obligor, and
(ii) the aggregate amount of the
Outstanding Balances of Defaulted Receivables.
"NIPSCO" means Northern Indiana Public Service Company, an
Indiana corporation, and any successor
thereto.
"Non-Defaulted Receivable" means any Receivable that is not a
Defaulted Receivable.
"Normal Concentration Limit" has the meaning specified in the
definition of "Concentration Limit".
"Obligor" means a Person obligated to make payments pursuant
to a Contract in respect of a
Receivable.
"Origination Date" means (i) the date of this Agreement, with
respect to Receivables existing on such
date and (ii) the date on which such
Receivable is created, with respect to each
other Receivable.
"Originator" means NIPSCO.
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<PAGE>
"Other Companies" means, collectively, the Originator and all
of its Subsidiaries and Affiliates except
the Seller.
"Other Taxes" has the meaning specified in Section 2.09.
"Outstanding Balance" means, for any Receivable, the unpaid
principal amount thereof; it being
acknowledged and agreed that with respect to
an Obligor under a Balanced Payment Plan,
the current amount invoiced to such
Obligor may not reflect the Outstanding
Balance of the Receivable from such
Obligor because such invoiced amount may
constitute, in whole or in part, either
(a) a prepayment for goods or services not
yet provided by the Originator, or
(b) a payment for goods or services
previously provided in a prior billing
cycle.
"Percentage" means, at any time with respect to any Bank
Purchaser, a fraction (expressed as a
percentage), the numerator of which is
equal to its Commitment at such time, and
the denominator of which is equal to
the aggregate Commitments of all Bank
Purchasers at such time.
"Permitted Investments" means any of the following investments
denominated and payable solely in Dollars:
(a) readily marketable debt
securities issued by, or the full and
timely payment of which is guaranteed by
the full faith and credit of, the federal
government of the United States of
America, (b) insured demand deposits, time
deposits and certificates of deposit
of any commercial bank rated at least A-1+
by S&P and P-1 by Moody's, (c) no
load money market funds rated in the
highest ratings category by each of Moody's
and S&P (without the "r" symbol
attached to any such rating by S&P), (d)
commercial paper of any corporation
incorporated under the laws of the United
States or any political subdivision
thereof, provided that such commercial paper
is rated at least A-1+ (and without any "r"
symbol attached to any such rating)
by S&P and at least Prime-1 by Moody's
and (e) any other securities or
investments of a passive nature approved in
writing by the Agent.
"Person" means an individual, partnership, corporation
(including a business trust), limited
liability company, joint stock company,
trust, unincorporated association, joint
venture or other entity, or a
government or any political subdivision or
agency thereof.
"Pool Receivable" means any Receivable which has been acquired
by the Seller from NIPSCO pursuant to the
Sale Agreement.
"Program Fee" means, with respect to each Fixed Period, a fee
payable on each Settlement Date to the
Agent, for the ratable benefit of the
Purchasers based upon the Capital of their
respective Receivable Interests,
equal to:
PFR x C x ED
---
360
where:
PFR = the Program Fee Rate for such
Fixed Period
C =
aggregate Capital of
all Receivable Interests during
such Fixed Period
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<PAGE>
ED =
the actual number of
days elapsed during such Fixed
Period
"Program Fee Rate" means a rate per annum equal to (i) 0.125%
during any Level 1 Ratings Period or any
Level 2 Ratings Period; (ii) 0.175%
during any Level 3 Ratings Period or (iii)
0.25% during any Level 4 Ratings
Period.
"Program Limit" means $200,000,000, as such amount may be
reduced pursuant to Section 2.01(b).
References to the unused portion of the
Program Limit shall mean, at any time, the
Program Limit (as then reduced
pursuant to Section 2.01(b)), minus the
aggregate outstanding Capital of all
Receivable Interests under this
Agreement.
"Purchasers" means, collectively, the Bank Purchasers and the
Conduit Purchaser.
"Receivable" means the indebtedness and other obligations of
any Obligor resulting from the provision or
sale of merchandise, goods or
services by the Originator under a
Contract, whether billed or unbilled,
including, without limitation, the right to
payment of any interest or finance
charges, late payment charges, delinquency
charges, extension or collection fees
and all other obligations of such Obligor
with respect thereto, and including,
without limitation, 100% of the amount
invoiced to any Obligor after the
Termination Date if any portion of the
goods or services covered by such invoice
were provided on or prior to the
Termination Date; provided, however, that any
Receivable repurchased by the Originator
pursuant to Section 2.04 of the Sale
Agreement shall thereafter cease to be
considered a Receivable.
"Receivable Interest" means, at any time, an undivided
percentage ownership interest in (i) all
then outstanding Pool Receivables
arising prior to the time of the most
recent computation or recomputation of
such undivided percentage interest pursuant
to Section 2.03, (ii) all Related
Security with respect to such Pool
Receivables, and (iii) all Collections with
respect to, and other proceeds of, such
Pool Receivables. Such undivided
percentage interest shall be computed at
the times and in the manner specified
in Section 2.03 as
C + TR
------
NRPB
where:
C =
the Capital of such
Receivable Interest at the time
of computation
TR =
the Total Reserves for
such Receivable Interest at
the time of computation
NRPB
= the Net Receivables Pool
Balance at the time of
computation
Each Receivable Interest shall be
determined from time to time pursuant to the
provisions of Section 2.03. Notwithstanding
the foregoing, from and after the
date on which the Amortization
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Date shall have occurred for all Receivable
Interests and until each Receivable
Interest is reduced to zero in accordance
with Section 2.03, (i) the sum of all
Receivable Interests shall be equal to 100%
and (ii) each Receivable Interest
shall be calculated as the percentage
equivalent of a fraction, the numerator of
which is the Capital of such Receivable
Interest, and the denominator of which
is equal to the aggregate Capital of all
Receivable Interests.
"Related Security" means with respect to any Receivable:
(i) all of the
Seller's interest in any
merchandise or goods (including returned merchandise or
goods), if any, relating to any sale giving rise to such
Receivable;
(ii)
all security interests or liens and property
subject thereto from time to time purporting to secure payment
of such Receivable, whether pursuant to the Contract related
to such Receivable or otherwise, together with all financing
statements authorized by an Obligor describing any collateral
securing such Receivable;
(iii) all
guaranties, insurance and other
agreements or arrangements of whatever character from time to
time supporting or securing payment of such Receivable whether
pursuant to the Contract related to such Receivable or
otherwise;
(iv)
all other books, records and other
information (including, without limitation, computer programs,
tapes, discs, punch cards, data processing software and
related property and rights) relating to such Receivable and
the related Obligor;
(v) all of the
Seller's right, title and
interest in and to all invoices or other agreements or
documents that evidence, secure or otherwise relate to such
Receivable; and
(vi)
all of the Seller's right, title and
interest in, to and under the Sale Agreement.
"Revolving Period" means the period beginning on the date of
the initial purchase hereunder and
terminating at the close of business on the
Business Day immediately preceding the
Termination Date.
"S&P" means Standard & Poor's, a division of The
McGraw-Hill
Companies, Inc.
"Sale Agreement" means the Receivables Sale Agreement of even
date herewith between the Seller and
NIPSCO, as amended, restated, supplemented
or otherwise modified from time to time in
accordance with the terms hereof and
thereof.
"Scheduled Commitment Termination Date" means December 28,
2004, unless, prior to such date (or the
date so extended pursuant to this
clause), upon the Seller's request,
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<PAGE>
made not more than 60 nor less than 45 days
prior to the then Scheduled
Commitment Termination Date, each Bank
Purchaser shall in its sole discretion
consent, which consent shall be given not
more than 30 days prior to the then
current Scheduled Commitment Termination
Date, to the extension of the Scheduled
Commitment Termination Date to a date
occurring up to 364 days after the then
current Scheduled Commitment Termination
Date. Each Bank Purchaser hereby agrees
to respond to any such request from the
Seller within 30 days of its receipt
thereof; provided, however, that any
failure of any Bank Purchaser to respond to
the Seller's request for such extension
shall be deemed a denial of such request
by such Bank Purchaser.
"SEC" means the Securities and Exchange Commission.
"Seller" has the meaning specified in the preamble.
"Seller Obligations" means all present and future indebtedness
and other liabilities and obligations
(howsoever created, arising or evidenced,
whether direct or indirect, absolute or
contingent, or due or to become due) of
the Seller to any Purchaser, the Agent
and/or any other Person, arising under or
in connection with this Agreement or any
other Transaction Document or the
transactions contemplated hereby or
thereby, and shall include, without
limitation, all Capital, Yield, Fees and
Servicer Fees and all other amounts due
or to become due under the Transaction
Documents (whether in respect of fees,
expenses, indemnifications or otherwise),
including, without limitation,
interest, fees and other obligations that
accrue after the commencement of any
bankruptcy, insolvency or similar
proceeding with respect to any Transaction
Party (in each case whether or not allowed
as a claim in such proceeding).
"Servicer" means at any time the Person then authorized
pursuant to Section 6.01 to administer and
collect Receivables.
"Servicer Default" means the occurrence of either of the
following events: (i) an Involuntary
Bankruptcy Event or (ii) an Event of
Termination.
"Servicer Fee" has the meaning specified in Section 2.05(a).
"Settlement Date" means, for any Receivable Interest, (i) the
last day of each Fixed Period for such
Receivable Interest (or if such day is
not a Business Day, the next succeeding
Business Day), and (ii) during a Level 4
Ratings Period or following the occurrence
of an Event of Termination or an
Involuntary Bankruptcy Event, each other
Liquidation Day for such Receivable
Interest specified by the Agent; provided,
however, that, in the case of a
Receivable Interest held by the Conduit
Purchaser, if Yield with respect to such
Receivable Interest is computed by
reference to the Investor Rate and no
Liquidation Day exists on the last day of a
Fixed Period for such Receivable
Interest, the Settlement Date for such
Receivable Interest for such Fixed Period
shall be the second Business Day after the
last day of such Fixed Period.
"Special Concentration Limit" has the meaning specified in the
definition of "Concentration Limit".
"Stress Factor" means 1.50; provided, however, that during any
Level 4 Ratings Period, the "Stress Factor"
shall be 2.00.
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"Subsidiary" means any corporation or other entity of which
securities having ordinary voting power to
elect a majority of the board of
directors or other persons performing
similar functions are at the time directly
or indirectly owned by NIPSCO, or one or
more Subsidiaries, or by NIPSCO and one
or more Subsidiaries.
"Tangible Net Worth" means at any time the excess of (a) the
Outstanding Balance of all Non-Defaulted
Receivables, minus (b) the aggregate
outstanding Capital hereunder, minus (c)
the outstanding Deferred Purchase
Price.
"Taxes" has the meaning specified in Section 2.09.
"Termination Agreements" means the agreements providing for
the termination of an Existing Receivables
Facility in the forms attached hereto
as Annex E.
"Termination Date" means the earliest of (a) the Scheduled
Commitment Termination Date, (b) the date
determined pursuant to Section 7.01,
(c) the date the Program Limit reduces to
zero pursuant to Section 2.01(b) and
(d) December 26, 2006.
"Three-Month Loss Ratio" means, as of the last day of any
calendar month, the average of the Loss
Ratios for such month and the two
immediately preceding calendar months.
"Total Reserves" means, for any Receivable Interest on any
date, an amount equal to:
(YFR + LR) x C
--
AC
where:
YFR = the Yield and Fee Reserve at the
time of computation
LR =
the Loss Reserve at
the time of computation
C =
the Capital of such
Receivable Interest at the time of
computation
AC =
the aggregate Capital
of all Receivable Interests at
the time of computation
"Transaction Documents" means this Agreement, the Sale
Agreement, the Blocked Account Agreements,
the Termination Agreements, the
certificate or articles of incorporation
and by-laws of the Seller and all
amendments, waivers and other agreements
executed and delivered pursuant hereto
or thereto to which a Transaction Party is
a party.
"Transaction Party" means any of the Seller, the Originator or
the Servicer.
"Turnover Ratio" means, for any calendar month, a number of
days obtained by multiplying (i) a
fraction, the numerator of which is equal to
the Net Receivables Pool Balance as of the
last day of such calendar month and
the denominator of which is equal to the
aggregate amount of Collections of Pool
Receivables during such month, times (ii)
30.
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<PAGE>
"UCC" means the Uniform Commercial Code as from time to time
in effect in the specified
jurisdiction.
"Yield" means the aggregate amount for the Conduit Purchaser
and the Bank Purchasers of the
following:
(i)
for each
Receivable Interest for any Fixed
Period to the extent the Conduit Purchaser will be funding
such Receivable Interest through the issuance of commercial
paper or other promissory notes at a fixed rate,
IR x C x ED + LF
---
360
(ii)
for each Receivable Interest for any Fixed
Period to
the extent (x) the Conduit Purchaser will not be
funding such Receivable Interest through the issuance of
commercial paper or other promissory notes at a fixed rate, or
(y) a Bank Purchaser will be funding such Receivable Interest,
AR x C x ED + LF
---
360
where:
AR =
the Assignee Rate for
such Receivable Interest for
such Fixed Period
C =
the Capital of such
Receivable Interest during such
Fixed Period
ED =
the actual number of
days elapsed during such Fixed
Period
IR =
the Investor Rate for
such Receivable Interest for
such Fixed Period
LF =
the Liquidation Fee,
if any, for such Receivable
Interest for
such Fixed Period
provided, that no provision of this
Agreement shall require the payment or
permit the collection of Yield in excess of
the maximum permitted by applicable
law; and provided further that Yield for
any Receivable Interest shall not be
considered paid by any distribution to the
extent that at any time all or a
portion of such distribution is rescinded
or must otherwise be returned for any
reason.
"Yield and Fee Reserve" means, for any Receivable Interest on
any date, an amount equal to
(AC x YFRP) + AUYF
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where:
AC =
the aggregate Capital
of all Receivable Interests at
the close of business of the Servicer on such date
YFRP = the Yield and Fee Reserve
Percentage on such date
AUYF = accrued and unpaid Yield, Servicer
Fee and Fees on
such date for all Receivable Interests
"Yield and Fee Reserve Percentage" means, on any date, a
percentage equal to
[(ABR x 1.5) + PFR + LFR + SF] x TR
where:
ABR = the Alternate Base Rate in effect
on such date
PFR = the Program Fee Rate in effect on
such date
LFR = the Liquidity Fee Rate in effect
on such date
SF =
the Servicer Fee in
effect on such date, expressed as
a rate per annum
TR =
a fraction, the
numerator of which is equal to the
average Turnover Ratio for the three calendar month
period then most recently ended, and the denominator
of which is 360
SECTION 1.02 Other Terms. All accounting terms not
specifically defined herein shall be
construed in accordance with generally
accepted accounting principles. All terms
used in Article 9 of the UCC in the
State of New York, as in effect on the date
hereof and not specifically defined
herein, are used herein as defined in such
Article 9.
Unless otherwise expressly indicated, all references herein to
"Article," "Section," "Schedule" or "Annex"
shall mean articles and sections of,
and schedules and annexes to, this
Agreement.
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01 Purchase Facility. (a) On the terms and
conditions hereinafter set forth, the
Conduit Purchaser may, in its sole
discretion, and if and to the extent the
Conduit Purchaser does not make a
purchase, the Bank Purchasers shall,
ratably in accordance with their respective
Commitments, severally and not jointly,
purchase Receivable Interests from the
Seller from time to time during the period
from the date hereof to the
Termination Date;
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provided, however, that (i) under no
circumstances shall the Conduit Purchaser
make any such purchase if, after giving
effect to such purchase, the aggregate
outstanding Capital of all Receivable
Interests would exceed the Program Limit;
and (ii) under no circumstances shall the
Bank Purchasers be obligated to make
any such purchase if, after giving effect
to such purchase, the aggregate
outstanding Capital of all Receivable
Interests would exceed the Aggregate
Commitment.
(b) If the
Seller determines that the facility provided
for in this Agreement exceeds its funding
needs, the Seller may, upon at least
five Business Days' notice to the Agent and
each Bank Purchaser, (i) reduce the
Program Limit to zero or, from time to
time, reduce in part the unused portion
of the Program Limit or (ii) reduce the
Aggregate Commitment to zero or, from
time to time, reduce in part the unused
portion of the Aggregate Commitment;
provided that each partial reduction of the
Program Limit or the Aggregate
Commitment shall be in the amount of at
least $1,000,000 or an integral multiple
thereof. Any reduction of the Program Limit
below the amount of the Aggregate
Commitment, and any reduction of the
Aggregate Commitment pursuant to this
Section 2.01(b), shall reduce each Bank
Purchaser's Commitment ratably in
accordance with their respective
Commitments. Any termination of the Program
Limit or the Aggregate Commitment pursuant
to this Section 2.01(b) shall
terminate each Bank Purchaser's
Commitment.
(c) Until the
Amortization Date for a Receivable
Interest, the Collections attributable to
such Receivable Interest shall be
automatically reinvested pursuant to (and
subject to the priority of payments
set forth in) Section 2.04 in additional
undivided percentage interests in the
Receivables by making an appropriate
readjustment of such Receivable Interest.
SECTION 2.02 Making Purchases. (a) Each purchase of a
Receivable Interest by the Purchasers shall
be made on at least three Business
Days' notice from the Seller to the Agent.
Each such notice of a purchase shall
specify (i) the amount requested to be paid
to the Seller (such amount, which
shall not be less than $5,000,000, being
referred to herein as the initial
"Capital" of the Receivable Interest then
being purchased), (ii) the date of
such purchase (which shall be a Business
Day) and (iii) if the Assignee Rate is
to apply to such Receivable Interest, the
duration of the initial Fixed Period
for such Receivable Interest. The Conduit
Purchaser shall promptly notify the
Seller and the Agent whether it has
determined to make the requested purchase on
the terms specified by the Seller.
If the Conduit Purchaser has determined not to make the entire
amount of a proposed purchase, the Agent
shall promptly send notice of the
proposed purchase to all of the Bank
Purchasers concurrently by telecopier,
telex or cable specifying the date of such
purchase, the aggregate amount of
Capital of the Receivable Interest being
purchased by such Bank Purchasers
(which amount shall be, subject to clause
(e) below, equal to the portion of the
purchase price not funded by the Conduit
Purchaser), each such Bank Purchaser's
portion thereof (determined ratably in
accordance with their respective
Commitments), whether the Yield for the
Fixed Period for such Receivable
Interest is calculated based on the
Adjusted Eurodollar Rate or the Alternate
Base Rate, and the duration of the Fixed
Period for such Receivable Interest
(which shall be one day if the Seller has
not selected another period in
accordance with the provisions set forth in
the definition of "Fixed Period").
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<PAGE>
(b) On the
date of each such purchase of a Receivable
Interest, the Conduit Purchaser and/or Bank
Purchasers shall, upon satisfaction
of the applicable conditions set forth in
Article III, make available to the
Seller in same day funds an aggregate
amount equal to the initial Capital of
such Receivable Interest, at the account
set forth in the Funds Transfer Letter;
provided, however, if such purchase is
being made by the Bank Purchasers
following the designation by the Agent of
an Amortization Date for a Receivable
Interest owned by the Conduit Purchaser
pursuant to clause (i)(a) of the
definition of Amortization Date and any
Capital of such Receivable Interest is
outstanding on such date of purchase, the
Seller hereby directs the Bank
Purchasers to pay the proceeds of such
purchase (to the extent of the
outstanding Capital on such Receivable
Interest of the Conduit Purchaser) to the
Agent's Account, for application to the
reduction of the outstanding Capital of
such Receivable Interest of the Conduit
Purchaser.
(c) Effective
on the date of each purchase pursuant to
this Section 2.02 and each reinvestment
pursuant to Section 2.04, the Seller
hereby sells and assigns to the Agent, for
the benefit of the Purchaser(s)
making such purchase or reinvestment, an
undivided percentage ownership
interest, to the extent of the Receivable
Interest then being purchased or in
respect of which the reinvestment is being
made, in each Receivable then
existing and in the Related Security and
Collections with respect thereto.
(d)
Notwithstanding the foregoing, the Conduit Purchaser
shall not make purchases under this
agreement at any time in an amount which
would exceed the Program Limit less the
aggregate outstanding Capital held by
the Conduit Purchaser.
(e)
Notwithstanding the foregoing, a Bank Purchaser shall
not be obligated to make purchases under
this Section 2.02 at any time in an
amount which would exceed such Bank
Purchaser's Commitment less the sum of (i)
the portion of Capital held by such Bank
Purchaser, plus (ii) such Bank
Purchaser's ratable share (determined in
accordance with their respective
Liquidity Commitments) of the aggregate
outstanding portion of Capital held by
the Conduit Purchaser (whether or not any
portion thereof has been assigned by
the Conduit Purchaser under an Asset
Purchase Agreement), determined after
giving effect to any reductions of the
Capital held by the Conduit Purchaser to
be made on the date of such purchase from
the proceeds of purchases by the Bank
Purchasers. Each Bank Purchaser's
obligation shall be several, such that the
failure of any Bank Purchaser to make
available to the Seller any funds in
connection with any purchase shall not
relieve any other Bank Purchaser of its
obligation, if any, hereunder to make funds
available on the date of such
purchase, but no Bank Purchaser shall be
responsible for the failure of any
other Bank Purchaser to make funds
available in connection with any purchase.
SECTION 2.03 Receivable Interest Computation. Each Receivable
Interest shall be initially computed on its
date of purchase. Thereafter until
the Amortization Date for such Receivable
Interest, such Receivable Interest
shall be automatically recomputed (or
deemed to be recomputed) on each day other
than a Liquidation Day. Any Receivable
Interest, as computed (or deemed
recomputed) as of the day immediately
preceding the Amortization Date for such
Receivable Interest, shall thereafter
remain constant; provided, however, that
from and after the date on which the
Amortization Date shall have occurred for
all Receivable Interests and until each
Receivable Interest becomes zero in
accordance with the next sentence, (i)
the
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<PAGE>
sum of all Receivable Interests shall be
equal to 100% and (ii) each Receivable
Interest shall be calculated as the
percentage equivalent of a fraction, the
numerator of which is the Capital of such
Receivable Interest, and the
denominator of which is equal to the
aggregate Capital of all Receivable
Interests. Each Receivable Interest shall
become zero when Capital thereof and
Yield thereon shall have been paid in full,
and all Fees and other Seller
Obligations are indefeasibly paid in
full.
SECTION 2.04 Settlement Procedures. (a) Except as otherwise
herein provided, Collection of the
Receivables shall be administered by the
Servicer in accordance with the terms of
Article VI of this Agreement and this
Section 2.04. The Seller shall provide to
the Servicer on a timely basis all
information needed for such administration,
including notice of the occurrence
of any Liquidation Day and current
computations of each Receivable Interest.
(b) Subject to
Section 2.04(c) below, on each Deposit
Date, the Servicer shall apply all
Collections deposited in any Blocked Account
or the Concentration Account on such
Deposit Date or received by the Servicer on
such Deposit Date in the following order
and priority:
(i) set aside
and hold in trust for the Agent an
amount equal to the Seller Obligations owing to the Agent in
respect of costs and expenses incurred in connection with the
enforcement of any Transaction Document or the collection of
any amounts due thereunder;
(ii)
set aside and hold in trust for the
Purchasers and the Agent an amount equal to the aggregate
Yield, Fees and Servicer Fee (to the extent payable by the
Purchasers under Section 2.05) accrued through such day for
all Receivable Interests and not previously set aside, such
amount to be allocated among the Purchasers and the Agent
ratably in accordance with the proportion of such amounts
payable to (or, in the case of the Servicer Fee, payable by)
each such Person;
(iii) if
the sum of the Receivable Interests are
greater than the Maximum Receivable Interests, set aside and
hold in trust for the Purchasers and the Agent an amount equal
to the amount of such excess;
(iv)
with respect to each Receivable Interest, if
such day is not a Liquidation Day for such Receivable
Interest, reinvest with the Seller on behalf of the
Purchaser(s) that hold such Receivable Interest the percentage
of such Collections represented by such Receivable Interest,
by recomputation of such Receivable Interest pursuant to
Section 2.03;
(v) if such
day is a Liquidation Day for one or
more Receivable Interests, set aside and hold in trust for the
Purchaser(s) that hold such Receivable Interests (ratably in
proportion to the
Capital of such Receivable Interests) an
amount equal to the lesser of (A) all of the remaining
Collections and (B) the Capital of such Receivable Interests;
provided that if amounts are set aside and held in trust on
any Liquidation Day occurring prior to the Amortization Date
for
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<PAGE>
the relevant Receivable Interests, and thereafter prior to the
next Settlement Date the conditions set forth in Section 3.02
are satisfied or waived by the Agent, such previously set
aside amounts shall, to the extent not previously distributed
pursuant to Section 2.04(c) or (d), be reinvested in
accordance with the preceding subsection (iv) on the day of
such subsequent satisfaction or waiver of conditions;
(vi)
if any Seller Obligations (other than Yield,
Fees, Servicer Fees and Capital) are then due and payable by
the Seller to any Indemnified Party, pay to each such
Indemnified Party (ratably in accordance with the amounts
owing to each) the Seller Obligations so due and payable;
(vii) pay
to the Servicer the portion (if any) of
the accrued and unpaid Servicer Fee payable by the Seller
pursuant to Section 2.05; and
(viii) release
to the Seller any remaining
Collections.
On or before each Settlement Date for a Receivable Interest,
the Servicer shall deposit or cause to be
deposited into the Agent's Account all
Collections set aside for the Purchasers
(including any amounts set aside for
the Agent) pursuant to clauses (i), (ii),
(iii) or (v) of this Section 2.04(b)
(excluding, if such Settlement Date is not
a Liquidation Day, any amounts set
aside on account of accrued Servicer Fee,
which amounts shall be retained by the
Servicer for its own account in payment of
such Servicer Fee).
(c) From and
after the commencement of any Level 4
Ratings Period or the occurrence of an
Event of Termination, after the
establishment of the Cash Collateral
Account, at the direction of the Agent, the
Servicer shall comply with the
following:
(i) The
Servicer shall cause all Collections to
be deposited into the Cash Collateral Account by no later than
the close of business on the applicable Deposit Date.
(ii)
All Collections deposited in the Cash
Collateral Account pursuant to this Section 2.04(c) shall be
allocated among the Purchasers pro rata based on the Seller
Obligations held by or payable to the Purchasers; provided
that if the amount so allocated exceeds the accrued and unpaid
Seller Obligations held by or payable to any Purchaser, such
excess shall be re-allocated to the other Purchasers ratably
in proportion to the amount of Seller Obligations held by or
payable to such other Purchasers.
(iii) On
each Settlement Date for a Receivable
Interest, the Agent shall cause all Collections allocated to
the Purchasers pursuant to this Section 2.04(c) that have not
been previously withdrawn hereunder (or such lesser amount as
the Agent may specify in its sole discretion) to be withdrawn
and remitted to the Agent's Account.
(d)
On each Settlement
Date, the Agent shall distribute
the funds deposited into the Agent's
Account pursuant to this Section 2.04 as
follows:
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<PAGE>
(i) first, pro
rata to the Purchasers and the
Agent in payment in full of all accrued Yield and Fees then
due and payable to each of them;
(ii)
second, if such distribution occurs on a
Liquidation Day for any Receivable Interest(s) held by one or
more Purchasers, pro rata to such Purchasers in reduction to
zero of all Capital of such Receivables Interests;
(iii)
third, to the Purchasers and the Agent in
payment in full of all other Seller Obligations payable to the
Purchasers and the Agent until such Seller Obligations have
been reduced to zero; and
(iv)
fourth, if such distribution occurs on a
Liquidation Day, to the Servicer in payment in full of the
accrued and unpaid Servicer Fee payable by the Purchasers
pursuant to Section 2.05.
After the Capital, Yield, Fees and Servicer Fee with respect
to each Receivable Interest held by the
Purchasers, and all other Seller
Obligations held by or owing to the
Purchasers, have been paid in full, all
additional Collections with respect to each
such Receivable Interest shall be
paid to the Seller for its own account.
(e) For the
purposes of this Section 2.04:
(i) if on any
day any Pool Receivable (or
portion thereof) becomes a Diluted Receivable, the Seller
shall be deemed to have received on such day a Collection of
such Pool Receivable in an amount equal to the Outstanding
Balance of such Pool Receivable (or portion thereof);
(ii)
if on any day any of the representations or
warranties contained in Section 4.01(h) is no longer true with
respect to any Receivable, the Seller shall be deemed to have
received on such day a Collection of such Receivable in full;
(iii)
except as otherwise required by applicable
law or the relevant Contract, or as otherwise specified by
such Obligor, any payment received from an Obligor of any
Receivables shall be applied as a Collection of the
Receivables of such Obligor in the order of the age of such
Receivables, starting with the oldest such Receivable; and
(iv)
if and to the extent the Agent or any
Purchaser shall be required for any reason to pay over to an
Obligor any amount received on its behalf hereunder, such
amount shall be deemed not to have been so received but rather
to have been retained by the Seller and, accordingly, the
Agent or such 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.
(f) Within one
Business Day after the end of each Fixed
Period in respect of which Yield is
computed by reference to the Investor Rate,
the Agent shall furnish the Seller
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<PAGE>
with an invoice setting forth the amount of
the accrued and unpaid Yield and
Fees for such Fixed Period with respect to
the Receivable Interests held by the
Conduit Purchaser.
SECTION 2.05 Payment of Certain Fees. (a) The Servicer shall
be entitled to receive a fee (the "Servicer
Fee") of 0.25% per annum on the
average daily aggregate Capital of all
Receivable Interests, payable in arrears
on each Settlement Date out of Collections
available for such purpose pursuant
to Section 2.04. Upon three Business Days'
notice to the Agent, the Servicer (if
not the Originator, the Seller or its
designee or an Affiliate of the Seller)
may, with the prior written consent of the
Agent, elect to be paid, as such fee,
another percentage per annum on the average
daily Outstanding Balance of the
Receivables. The portion of the Servicer
Fee payable by each Purchaser shall be
equal to 0.25% per annum on the average
daily Capital of each Receivable
Interest owned by such Purchaser, payable
on each Settlement Date for such
Receivable Interest. Notwithstanding
anything herein to the contrary, the
Servicer Fee shall be payable only from
Collections pursuant to, and subject to
the priority of payments set forth in,
Section 2.04. To the extent such
Collections are not sufficient to pay the
Servicer Fee in full, none of the
Seller, the Agent or the Purchasers shall
have any liability for the deficiency.
(b) If the
Agent notifies the Seller that an Accounting
Based Consolidation Event has occurred, the
Seller shall pay to the Agent an
accounting adjustment fee (the
"Consolidation Fee"), which shall accrue at the
Applicable Eurodollar Rate Margin on the
daily average amount of Capital of all
Receivable Interests of the Conduit
Purchaser during the period commencing on
and including the date that an Accounting
Based Consolidation Event shall occur
to but excluding the date on which the
Capital of the Receivable Interests of
the Conduit Purchaser has been reduced to
zero, calculated based on a the number
of actual days elapsed and a 360-day year.
Such accounting adjustment fee shall
be payable in arrears on each Settlement
Date, commencing with the first
Settlement Date occurring after the
occurrence of an Accounting Based
Consolidation Event.
SECTION 2.06 Payments and Computations, Etc. (a) All amounts
to be paid by the Seller or the Servicer to
the Agent or any Purchaser hereunder
shall be paid no later than 11:00 A.M. (New
York City time) on the day when due
in same day funds to the Agent's Account.
All amounts to be deposited by the
Seller or the Servicer into the Cash
Collateral Account or any other account
shall be deposited no later than 11:00 A.M.
(New York City time) on the date
when due.
(b) Each of
the Seller and the Servicer shall, to the
extent permitted by law, pay interest on
any amount not paid or deposited by it
when due hereunder, at an interest rate per
annum equal to 2.00% per annum above
the Alternate Base Rate, payable on
demand.
(c) All
computations of interest under subsection (b)
above and all computations of Yield, Fees,
and other amounts hereunder shall be
made on the basis of a year of 360 days for
the actual number of days (including
the first but excluding the last day)
elapsed. Whenever any payment or deposit
to be made hereunder shall be due on a day
other than a Business Day, such
payment or deposit shall be made on the
next succeeding Business Day and such
extension of time shall be included in the
computation of such payment or
deposit.
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SECTION 2.07 Dividing or Combining Receivable Interests.
Either the Seller or (following an Event of
Termination or an Involuntary
Bankruptcy Event) the Agent may, upon
notice to the other party received at
least three Business Days prior to the last
day of any Fixed Period in the case
of the Seller giving notice, or up to the
last day of such Fixed Period in the
case of the Agent giving notice, either (i)
divide any Receivable Interest into
two or more Receivable Interests having
aggregate Capital equal to the Capital
of such divided Receivable Interest, or
(ii) combine any two or more Receivable
Interests originating on such
