Exhibit 10.1
Receivables Sale
Agreement
Dated as of
September 26, 2007
among
Tronox Funding
LLC,
as the Seller,
Tronox Worldwide
LLC,
as the Initial Collection
Agent,
ABN AMRO Bank
N.V.,
as the Agent,
the Committed
Purchasers
from time to time party
hereto,
and
Amsterdam Funding
Corporation
Table of
Contents
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Page
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Article I
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Purchases from Seller and
Settlements |
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1 |
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Section 1.1.
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Sales |
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1 |
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Section 1.2.
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Interim Liquidations. |
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3 |
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Section 1.3.
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Selection of Discount Rates and
Tranche Periods. |
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3 |
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Section 1.4.
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Fees and Other Costs and
Expenses |
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4 |
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Section 1.5.
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Maintenance of Sold Interest; Deemed
Collection |
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5 |
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Section 1.6.
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Reduction in Commitments |
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6 |
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Section 1.7.
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Optional Repurchases. |
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6 |
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Section 1.8.
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Security Interest. |
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6 |
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Section 1.9.
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Extension of Scheduled Termination
Date. |
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7 |
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Section 1.10.
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Term-Out Option. |
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7 |
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Article II
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Sales to and from the Conduit;
Allocations |
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8 |
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Section 2.1.
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Required Purchases from the
Conduit. |
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8 |
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Section 2.2.
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Purchases by the Conduit. |
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8 |
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Section 2.3.
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Allocations and Distributions |
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9 |
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Article III
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Administration and
Collections |
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11 |
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Section 3.1.
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Appointment of Collection Agent |
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11 |
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Section 3.2.
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Duties of Collection Agent |
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11 |
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Section 3.3.
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Reports |
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12 |
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Section 3.4.
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Lock-Box Arrangements |
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12 |
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Section 3.5.
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Enforcement Rights |
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13 |
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Section 3.6.
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Collection Agent Fee |
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13 |
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Section 3.7.
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Responsibilities of the Seller |
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14 |
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Section 3.8.
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Actions by Seller |
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14 |
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Section 3.9.
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Indemnities by the Collection
Agent. |
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14 |
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Section 3.10.
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Cash Collateral Account. |
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15 |
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Article IV
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Representations and
Warranties |
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16 |
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Section 4.1.
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Representations and Warranties |
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16 |
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Section 4.2.
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Representations and Warranties of the
Initial Collection Agent |
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19 |
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Article V
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Covenants |
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20 |
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Section 5.1.
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Covenants of the Seller |
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20 |
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Article VI
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Indemnification |
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25 |
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Section 6.1.
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Indemnities by the Seller |
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25 |
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Section 6.2.
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Increased Cost and Reduced
Return |
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27 |
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Section 6.3.
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Other Costs and Expenses |
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27 |
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Section 6.4.
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Withholding Taxes |
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28 |
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Section 6.5.
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Payments and Allocations |
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29 |
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Article VII
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Conditions Precedent |
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29 |
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Section 7.1.
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Conditions to Closing |
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29 |
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Section 7.2.
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Conditions to Each Purchase |
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30 |
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Article VIII
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The Agent |
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31 |
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Section 8.1.
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Appointment and Authorization |
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31 |
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Section 8.2.
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Delegation of Duties |
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31 |
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Section 8.3.
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Exculpatory Provisions |
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31 |
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Section 8.4.
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Reliance by Agent |
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31 |
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Section 8.5.
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Assumed Payments |
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31 |
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Section 8.6.
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Notice of Termination Events |
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32 |
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Section 8.7.
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Non-Reliance on Agent and Other
Purchasers |
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32 |
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Section 8.8.
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Agent and Affiliates. |
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32 |
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Section 8.9.
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Indemnification |
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32 |
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Section 8.10.
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Successor Agent. |
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33 |
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Article IX
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Miscellaneous |
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33 |
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Section 9.1.
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Termination |
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33 |
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Section 9.2.
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Notices |
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33 |
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Section 9.3.
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Payments and Computations |
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34 |
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Section 9.4.
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Sharing of Recoveries |
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34 |
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Section 9.5.
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Right of Setoff |
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34 |
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Section 9.6.
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Amendments |
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34 |
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Section 9.7.
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Waivers |
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35 |
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Section 9.8.
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Successors and Assigns;
Participations; Assignments |
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35 |
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Section 9.9.
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Intended Tax Characterization |
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37 |
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Section 9.10.
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Confidentiality |
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37 |
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Section 9.11.
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Agreement Not to Petition. |
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38 |
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Section 9.12.
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Excess Funds |
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38 |
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Section 9.13.
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No Recourse |
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38 |
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Section 9.14.
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Headings; Counterparts. |
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39 |
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Section 9.15.
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Cumulative Rights and
Severability. |
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39 |
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Section 9.16.
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Governing Law; Submission to
Jurisdiction |
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39 |
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Section
9.17.
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Waiver of Trial by Jury |
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39 |
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Section 9.18.
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Third Party Beneficiaries. |
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39 |
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Section 9.19.
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Entire Agreement. |
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39 |
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Section 9.20.
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Limited Recourse |
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39 |
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-ii-
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Schedules
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Description |
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Schedule I
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Definitions |
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Schedule II
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Liquidity Providers and Commitments
of Committed Purchasers |
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Schedule III
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Notice Information |
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Schedule 4.1
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Material Litigation |
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Exhibits
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Description |
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Exhibit A
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Form of Incremental Purchase
Request |
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Exhibit B
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Form of Notification of Assignment to
the Conduit from the Committed Purchasers |
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Exhibit C
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Form of Periodic Report |
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Exhibit D
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Addresses and Names of Seller and
Originators |
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Exhibit E
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[Reserved] |
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Exhibit F
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Lock-Boxes and Lock-Box Banks |
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Exhibit G
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Credit and Collection Policy |
-iii-
Receivables Sale
Agreement
Receivables Sale Agreement, dated
as of September 26, 2007, among Tronox Funding LLC, a Delaware
limited liability company, as Seller (the
“Seller” ), Tronox Worldwide LLC, a Delaware
limited liability company, as initial Collection Agent (the
“Initial Collection Agent,” and, together with
any successor thereto, the “Collection Agent” ),
ABN AMRO Bank N.V., as agent for the Purchasers (the
“Agent” ), the committed purchasers party hereto
(the “Committed Purchasers” ), and Amsterdam
Funding Corporation (the “Conduit” ). Certain
capitalized terms used herein, and certain rules of construction,
are defined in Schedule I. The Committed Purchasers and the
Commitments of the Committed Purchasers are listed on
Schedule II.
T he parties hereto agree as
follows:
Article I
Purchases from Seller and
Settlements
Section 1.1. Sales .
(a) The Sold Interest. Subject
to the terms and conditions hereof, the Seller may, from time to
time before the Maturity Date, sell to the Conduit or, only if the
Conduit declines to make the applicable purchase, ratably to the
Committed Purchasers an undivided percentage ownership interest in
the Receivables, the Related Security and all related Collections.
Any such purchase (a “Purchase” ) shall be made
by each relevant Purchaser remitting funds to the Seller, through
the Agent, pursuant to Section 1.1(c) or by the Collection
Agent remitting Collections to the Seller pursuant to
Section 1.1(d). The aggregate percentage ownership interest so
acquired by a Purchaser in the Receivables, the Related Security
and related Collections (its “Purchase Interest”
) equals at any time the sum of the following percentages:
I+PRP
— NR
where:
I = the
outstanding Investment of such Purchaser at such time;
NR = the
Net Receivables Balance at such time plus any Collections on
Eligible Receivables that have not yet been applied to reduce
Investment pursuant to Section 2.3; and
PRP =
the Purchaser Reserve Percentage of such Purchaser at such
time.
Except
during a Liquidation Period for a Purchaser, such Purchaser’s
Purchase Interest will change whenever its Investment, its
Purchaser Reserve Percentage or the Eligible Receivables
Balance
changes. During a Liquidation Period for a Purchaser its Purchase
Interest shall remain constant at the percentage in effect as of
the day immediately preceding the commencement of the relevant
Liquidation Period, except for redeterminations to reflect
Investment acquired from or transferred to another Purchaser
hereunder or under the Transfer Agreement. The sum of all
Purchasers’ Purchase Interests at any time is referred to
herein as the “Sold Interest,” which at any time
is the aggregate percentage ownership interest then held by the
Purchasers in the Receivables, the Related Security and
Collections.
(b) Conduit Purchase Option and Other
Purchasers’ Commitments . Subject to Section 1.1(d)
concerning Reinvestment Purchases, at no time will the Conduit have
any obligation to make a Purchase. Each purchaser listed on
Schedule II hereto (together, the “Committed
Purchasers” and each, a “Committed
Purchaser” ) severally hereby agrees, subject to
Section 7.2 and the other terms and conditions hereof
(including, in the case of an Incremental Purchase (as defined
below), that the Conduit has refused to make all or part of a
requested Purchase), to make Purchases before the Maturity Date,
based on its Ratable Share of each Purchase, to the extent its
Investment would not thereby exceed its Commitment, the Aggregate
Investment would not thereby exceed the Purchase Limit, and the
Matured Aggregate Investment would not thereby exceed the Aggregate
Commitment. Each Purchaser’s first Purchase and each
additional Purchase by such Purchaser not made from Collections
pursuant to Section 1.1(d) is referred to herein as an
“Incremental Purchase” and the amount thereof as
an “Incremental Purchase Amount.” Each Purchase
made by a Purchaser with the proceeds of Collections in which it
has a Purchase Interest, which does not increase the outstanding
Investment of such Purchaser, is referred to herein as a
“Reinvestment Purchase.”
(c) Incremental Purchases . In
order to request an Incremental Purchase from a Purchaser, the
Seller must provide to the Agent an irrevocable written request
substantially in the form of Exhibit A, by
(i) 10:00 a.m. (Chicago time) three Business Days before
the requested date (the “Purchase Date” ) of
such Purchase, in the case of each Purchase by the Conduit,
(ii) 10:00 a.m. (Chicago time) three Business Days before
the Purchase Date in the case of each Purchase by the Committed
Purchasers that is to accrue Discount at the Eurodollar Rate and
(iii) 10:00 a.m. (Chicago time) on the Purchase Date in
the case of each Purchase by the Committed Purchasers that is to
accrue Discount at the Prime Rate, or, in each of the foregoing
cases, such later time or day as the Conduit or the Committed
Purchasers, as applicable, may agree. Each such notice shall
specify the requested Purchase Date (which must be a Business Day)
and the requested amount (the “Purchase Amount”
) of such Purchase, which must be in a minimum amount of $1,000,000
and multiples thereof (or, if less, an amount equal to the Maximum
Incremental Purchase Amount). An Incremental Purchase may only be
requested from the Conduit unless the Conduit, in its sole
discretion, determines not to make such Incremental Purchase, in
which case the Seller may request such Incremental Purchase from
the Committed Purchasers. The Agent shall promptly notify each
Purchaser from which the Purchase is requested of the contents of
any such request. If the Conduit determines, in its sole
discretion, to make all or any portion of the requested Purchase,
the Conduit shall transfer to the Agent’s Account the
Purchase Amount (or portion thereof) on the requested Purchase
Date. If the Conduit determines, in its sole discretion, not to
make all or any portion of a requested Purchase and the Seller
requests the Incremental Purchase from the Committed Purchasers,
subject to Section 7.2 and the other terms and conditions
hereof, each Committed Purchaser shall transfer
its
Ratable Share of that portion of the requested Purchase Amount not
funded by the Conduit into the Agent’s Account by no later
than 12:00 noon (Chicago time) on the Purchase Date (which, in the
case of a Purchase that is to accrue Discount at the Eurodollar
Rate, in no event will be earlier than three Business Days after
such request is made to the Committed Purchasers). The Agent shall
transfer to the Seller Account the proceeds of any Incremental
Purchase delivered into the Agent’s Account. Notwithstanding
anything contained herein to the contrary, during the Term-Out
Period all Incremental Purchases to be made by the Committed
Purchasers shall be made from funds available therefor in the Cash
Collateral Account.
(d) Reinvestment Purchases . Unless
the Conduit has provided to the Agent, the Seller, and the
Collection Agent a notice (which notice has not been revoked by the
Conduit) that it no longer wishes to make Reinvestment Purchases
(in which case the Conduit’s Reinvestment Purchases, but not
those of the Committed Purchasers, will cease), on each day before
the Termination Date that any Collections are received by the
Collection Agent and no Interim Liquidation is in effect, a
Purchaser’s Purchase Interest in such Collections shall
automatically be used to make a Reinvestment Purchase by such
Purchaser. The Conduit may revoke any notice provided under the
first sentence of this Section 1.1(d) by notifying the Agent,
the Seller, and the Collection Agent that it will resume making
Reinvestment Purchases. Notwithstanding the foregoing, the Seller
and each Committed Purchaser agree that, during the Term-Out
Period, such Purchaser’s Purchase Interest in any Collections
received by the Collection Agent when an Interim Liquidation is in
effect, shall automatically be deposited in the Cash Collateral
Account.
Section 1.2. Interim Liquidations .
(a) Optional . The Seller may at any time direct that
Reinvestment Purchases cease and that an Interim Liquidation
commence from Collections and amounts available pursuant to
Section 1.7 for all Purchasers by giving the Agent and the
Collection Agent at least three Business Days’ prior written
notice specifying the date on which the Interim Liquidation will
commence and, if desired, when such Interim Liquidation will cease
(identified as a specific date prior to the Maturity Date or as
when the Aggregate Investment is reduced to a specified amount). If
the Seller does not so specify the date on which an Interim
Liquidation shall cease, it may cause such Interim Liquidation to
cease at any time before the Maturity Date, subject to
Section 1.2(b) below, by giving the Agent and the Collection
Agent at least three Business Days’ prior written notice
before the date on which it desires such Interim Liquidation to
cease.
(b) Mandatory . If at any time
before the Maturity Date any condition in Section 7.2 is not
fulfilled, Reinvestment Purchases will cease and an Interim
Liquidation will commence, which will cease only upon the Seller
confirming to the Agent that the conditions in Section 7.2 are
fulfilled.
Section 1.3. Selection of Discount Rates
and Tranche Periods. (a) The Conduit. The
Conduit’s Investment will accrue Funding Charges for each day
on which it is outstanding. On each Settlement Date the Seller
shall pay to the Agent (for the benefit of the Conduit) an
aggregate amount equal to all accrued and unpaid Funding Charges in
respect of such Investment for the immediately preceding Discount
Period. The Agent shall allocate the Investment of the Conduit to
Tranche Periods in its sole discretion.
(b) Committed Purchasers . All
Investment of the Committed Purchasers will be allocated to one or
more Tranches reflecting the Discount Rates at which such
Investment accrues Discount and the Tranche Periods for which such
Discount Rates apply. In each request for an Incremental Purchase
from the Committed Purchasers and three Business Days before the
expiration of any Tranche Period applicable to any Committed
Purchaser’s Investment, the Seller may request the Tranche
Period(s) to be applicable to such Investment and the Discount
Rate(s) applicable thereto. All Investment of the Committed
Purchasers may accrue Discount at either the Eurodollar Rate or the
Prime Rate, in all cases as established for each Tranche Period
applicable to such Investment. Any Investment of the Committed
Purchasers not allocated to a Tranche Period will be a Prime
Tranche. For so long as a Termination Event has occurred and is
continuing, the Agent may reallocate any outstanding Investment of
the Committed Purchasers to a Prime Tranche. All Discount accrued
on the Investment of the Committed Purchasers during a Tranche
Period shall be payable by the Seller on the last day of such
Tranche Period. If, by the time required by this
Section 1.3(b), the Seller fails to select a Discount Rate or
Tranche Period for any Investment of the Committed Purchasers, such
amount of Investment will automatically accrue Discount at the
Prime Rate for a three Business Day Tranche Period. Any Investment
purchased from the Conduit pursuant to the Transfer Agreement will
accrue interest at the Prime Rate and have an initial Tranche
Period of three Business Days.
(c) If the Agent or any Committed
Purchaser determines (i) that maintenance of any Eurodollar
Tranche would violate any applicable law or regulation,
(ii) that deposits of a type and maturity appropriate to match
fund any of such Committed Purchaser’s Eurodollar Tranches
are not available or (iii) that the maintenance of any
Eurodollar Tranche will not adequately and fairly reflect the cost
of such Committed Purchaser of funding Eurodollar Tranches, then
the Agent, upon the direction of such Committed Purchaser, shall
suspend the availability of future Eurodollar Tranches until such
time as the Agent or applicable Committed Purchaser provides notice
that the circumstances giving rise to such suspension no longer
exist, and, if required by any applicable law or regulation,
terminate any outstanding Eurodollar Tranche so affected. All
Investment allocated to any such terminated Eurodollar Tranche
shall be reallocated to a Prime Tranche.
Section 1.4. Fees and Other Costs and
Expenses . (a) The Seller shall pay to the Agent for the
ratable benefit of the Committed Purchasers, such amounts as agreed
to with the Committed Purchasers and the Agent in the Fee
Letter.
(b) If (i) the amount of the
Conduit’s Investment is reduced (other than as a result of a
Put) on any date other than the last day of a CP Tranche,
(ii) the amount of Investment allocated to any Eurodollar
Tranche is reduced on any day other than the last day of its
Tranche Period or (iii) if a requested Incremental Purchase at
the Eurodollar Rate does not take place on its scheduled Purchase
Date, the Seller shall pay the Early Payment Fee to each Purchaser
that had its Investment so reduced or scheduled Purchase not
made.
(c) Investment, Discount and Funding
Charges are not recourse obligations of the Seller and shall be
payable solely from Collections and from amounts payable under
Sections 1.5, 1.7 and 6.1 (to the extent amounts paid under
Section 6.1 indemnify against reductions in or
non-payment of Receivables). The Seller shall pay, as a full
recourse obligation, all other amounts payable hereunder.
(d) Notwithstanding anything in this
Agreement to the contrary, in no event will the Funding Charges or
Discount charged and payable hereunder exceed any maximum interest
rate imposed by applicable law or regulation.
Section 1.5. Maintenance of Sold
Interest; Deemed Collection . (a) General . If at any
time before the Maturity Date the Eligible Receivables Balance is
less than the sum of the Aggregate Investment (or, if a Termination
Event exists, the Matured Aggregate Investment) plus the Aggregate
Reserve, the Seller shall pay to the Agent an amount equal to such
deficiency for application to reduce the Investments of the
Purchasers ratably in accordance with the principal amount of their
respective Investments, applied first to Prime Tranches and
second to the other Tranches with the shortest remaining
maturities unless otherwise specified by the Seller.
(b) Deemed Collections . If on any
day the Outstanding Balance of a Receivable is reduced or cancelled
as a result of any defective or rejected goods or services, any
cash discount or adjustment (including any adjustment resulting
from the application of any special refund or other discounts or
any reconciliation), any setoff or credit (whether such claim or
credit arises out of the same, a related, or an unrelated
transaction) or other reason not arising from the financial
inability of the Obligor to pay undisputed indebtedness, the Seller
shall be deemed to have received on such day a Collection on such
Receivable in the amount of such reduction or cancellation. If on
any day any representation, warranty, covenant or other agreement
of the Seller related to a Receivable is not true or is not
satisfied, the Seller shall be deemed to have received on such day
a Collection in the amount of the Outstanding Balance of such
Receivable. All such Collections deemed received by the Seller
under this Section 1.5(b) shall be remitted by the Seller to
the Collection Agent in accordance with Section 5.1(i).
(c) Adjustment to Sold
Interest . At any time before the Termination Date that the
Seller is deemed to have received any Collection under
Section 1.5(b) ( “Deemed Collections” )
that derives from a Receivable that is otherwise reported as an
Eligible Receivable, so long as no Liquidation Period then exists,
the Seller may satisfy its obligation to deliver the amount of such
Deemed Collections to the Collection Agent by instead notifying the
Agent that the Sold Interest should be recalculated by decreasing
the Net Receivables Balance by the amount of such Deemed
Collections, so long as such adjustment does not cause the Sold
Interest to exceed 100%.
(d) Receivables Retransfers. If the
Agent receives Deemed Collections or if an adjustment is made to
the Sold Interest pursuant to Section 1.5(c) that in either
case equals or exceeds the Outstanding Balance of any Receivable,
the Seller may request that the Agent, on behalf of the Purchasers,
reconvey to the Seller all right, title and interest of such
Purchasers in and to such Receivable, the Related Security, all
Collections receivable in respect thereof and all rights with
respect thereto under the Purchase Agreement that have previously
been conveyed hereunder (directly or indirectly) to the Purchasers,
and the Agent shall, promptly following such request, effect such
transfer to the Seller. Each transfer made by the Agent under this
Section 1.5(d) will be without recourse, representation or
warranty, express or implied, of any type or
kind on
the part of the Agent and the Purchasers. The Seller shall bear all
costs and expenses incurred by the Agent or any Purchaser in
effecting any such transfer to the Seller.
Section 1.6. Reduction in
Commitments . The Seller may, upon thirty days’ notice to
the Agent, reduce the Aggregate Commitment in increments of
$1,000,000, so long as the Aggregate Commitment as so reduced is no
less than the Matured Aggregate Investment. Each such reduction in
the Aggregate Commitment will reduce the Commitment of each
Committed Purchaser in accordance with its Ratable Share and will
reduce the Purchase Limit so that the Aggregate Commitment remains
at least 102% of the Purchase Limit and the Purchase Limit is no
less than the outstanding Aggregate Investment.
Section 1.7. Optional Repurchases.
At any time that the Aggregate Investment is less than 10% of the
Aggregate Commitment in effect on the date hereof, the Seller may,
upon ten days’ notice to the Agent, repurchase the entire
Sold Interest from the Purchasers at a price equal to the
outstanding Matured Aggregate Investment and all other amounts then
owed hereunder. The Seller must use amounts obtained through a
capital contribution by its member to effectuate such
repurchase.
Section 1.8. Security Interest.
(a) The Seller hereby grants to the Agent, for its own benefit
and for the ratable benefit of the Purchasers, a security interest
in its right, title and interest in, to and under all Receivables,
Related Security, Collections, Lock-Box Accounts and the Purchase
Agreement to secure the payment of all amounts other than
Investment owing hereunder and (to the extent of the Sold Interest)
to secure the repayment of all Investment. The Seller and
Collection Agent shall hold in trust for the benefit of the Persons
entitled thereto any Collections received pending their application
pursuant to Section 1.1(c), Section 2.3 or Article III
hereof. After the occurrence of a Termination Event, the Seller and
Collection Agent shall not, without the prior written consent of
the Instructing Group, distribute any Collections to any Person
(whether as payment on the Subordinated Notes or otherwise) other
than the Agent and the Purchasers (and to the Collection Agent, in
payment of the Collection Agent Fee to the extent permitted
hereunder) until all amounts owed under the Transaction Documents
to the Agent and the Purchasers are indefeasibly paid in
full.
(b) The Seller hereby assigns and otherwise
transfers to the Agent (for the benefit of the Agent, each
Purchaser and any other Person to whom any amount is owed
hereunder), all of the Seller’s rights under the Purchase
Agreement but only to the extent that they relate to such
Receivables, the Related Security and the indemnification and
payment obligations of each Originator thereunder. The Seller shall
prepare, file and record all financing statements, continuation
statements and other documents required to perfect or protect such
assignment. This assignment includes (a) all monies due and to
become due to the Seller from each Originator under or in
connection with the Purchase Agreement with respect to any
Receivable sold hereunder (including fees, expenses, costs,
indemnities and damages for the breach of any obligation or
representation related to such Receivable) and (b) all rights,
remedies, powers, privileges and claims of the Seller against each
Originator under or in connection with the Purchase Agreement. All
provisions of the Purchase Agreement inure to the benefit of, and
may be relied upon by, the Agent, each Purchaser and each such
other Person. At any time when a Termination Event has occurred and
is continuing, the Seller shall only exercise its rights and
remedies
under the Purchase Agreement in accordance with the instructions of
the Agent, but without any obligation on the part of the Agent, any
Purchaser or any other such Person to perform any of the
obligations of the Seller under the Purchase Agreement (or the
promissory note executed thereunder). All amounts distributed to
the Seller under the Purchase Agreement from Receivables sold to
the Seller thereunder constitute Collections hereunder and shall be
applied in accordance herewith.
(c) This agreement is a security
agreement for purposes of the UCC. Upon the occurrence of a
Termination Event, the Agent will have all rights and remedies
provided under the UCC as in effect in all applicable
jurisdictions.
Section 1.9. Extension of Scheduled
Termination Date. No later than 60 days prior to the
Scheduled Termination Date the Seller may request in a written
notice to the Agent that the Scheduled Termination Date then in
effect be extended by three hundred sixty-four (364) days. The
Agent will promptly inform each Committed Purchaser of any such
request and each Committed Purchaser shall notify the Agent in
writing no later than 30 days after its receipt of such notice
whether such Committed Purchaser agrees to such extension (each
such Committed Purchaser agreeing to such extension being a
“Consenting Committed Purchaser” ). In the event
that a Committed Purchaser shall fail timely to so notify the Agent
whether it agrees to such extension, such Committed Purchaser shall
be deemed to have refused to grant the requested extension. Upon
receipt by the Agent of the consent to such extension of all the
Committed Purchasers no later than 30 days after its receipt
of such notice, the Scheduled Termination Date shall be
automatically extended an additional three hundred sixty-four
(364) days. If the Instructing Group consents to such
extension but fewer than all the Committed Purchasers so consent,
and if the Seller still desires to extend the Scheduled Termination
Date, the Seller may seek to replace any Committed Purchaser that
is a non-Consenting Committed Purchaser pursuant to
Section 9.8.
If the Seller and all the Committed
Purchasers do not agree to the extension and each non-Consenting
Committed Purchaser is not replaced, and the event that the Seller
does not activate the Term-Out Option set forth in
Section 1.10 below, the Scheduled Termination Date shall take
place as scheduled. If the Scheduled Termination Date is extended,
any non-Consenting Committed Purchaser shall be replaced on the
effective date of the assignment as set forth above and all amounts
owing to such Committed Purchaser hereunder shall, on such
effective date, be paid in full pursuant to the terms of
Section 9.8 hereof.
Notwithstanding anything contained herein
to the contrary, any extension of the Scheduled Termination Date or
Maturity Date to a date beyond September 22, 2010, is subject
to the approval of all Purchasers.
Section 1.10. Term-Out Option. (a) If
the Seller has requested an extension of the Scheduled Termination
Date pursuant to Section 1.9 but all of the Committed
Purchasers do not agree to such extension, then the Seller may, in
its sole discretion, make effective for all purposes herein clause
(b), rather than clause (a), of the definition of “
Maturity Date ” set forth in Schedule I hereto by
providing written notice (the “Term-Out Activation
Notice” ) thereof to the Agent not later than 10 Business
Days prior to the
Scheduled Termination Date. In the event the Seller so exercises
the Term-Out Option as aforesaid, the Scheduled Termination Date
shall constitute the “Cash Secured Purchase Commencement
Date” ; provided that the Cash Secured Purchase
Commencement Date shall occur on such date if, but only if,
(i) the Termination Date shall not have occurred on or prior
to such date and (ii) no Termination Event exists on such date
and no Potential Termination Event exists on such date.
(b) Making Purchases After the Cash
Secured Purchase Commencement Date . At least five (5) Business
Days prior to the Cash Secured Purchase Commencement Date, the
Seller shall notify the Agent if the Seller wishes the Committed
Purchasers to make the deposits described in this Section.
Following such notice, on the Cash Secured Purchase Commencement
Date, each Committed Purchaser shall, and severally agrees to, make
a deposit in the Cash Collateral Account in Dollars in an amount
equal to the excess of (i) such Committed Purchaser’s
Commitment over (ii) the outstanding Investment held by such
Committed Purchaser on such date.
Article II
Sales to and from the
Conduit; Allocations
Section 2.1. Required Purchases from the
Conduit. (a) The Conduit may, at any time sell to the
Committed Purchasers pursuant to the Transfer Agreement any
percentage designated by the Conduit of the Conduit’s
Investment and its related Conduit Settlement (each, a
“Put” ).
(b) Any portion of the Conduit’s
Investment and related Conduit Settlement purchased by a Committed
Purchaser will be considered part of such Purchaser’s
Investment and related Conduit Settlement from the date of the
relevant Put. Immediately upon any purchase by the Committed
Purchasers of any portion of the Conduit’s Investment, the
Seller shall pay to the Agent (for the ratable benefit of such
Purchasers) an amount equal to the sum of (i) the Assigned
Conduit Settlement, (ii) all accrued and unpaid Discount owed
to the Conduit (whether or not then due) to the end of each
applicable Tranche Period to which any portion of the
Conduit’s Investment being Put has been allocated,
(iii) the pro rata portion of all accrued but unpaid fees
(whether or not then due) payable to the Conduit in connection
herewith at the time of such purchase and (iv) a pro rata
portion of all accrued and unpaid costs, expenses and indemnities
due to the Conduit from the Seller in connection herewith.
(c) Until used to pay commercial paper, all proceeds of any
Put pursuant to this Section shall be invested by the Agent in
Permitted Investments. All earnings on such Permitted Investments
shall be promptly remitted by the Agent to the Seller.
Section 2.2. Purchases by the
Conduit. The Conduit may at any time deliver to the Agent and
each Committed Purchaser a notification of assignment in
substantially the form of Exhibit B. If the Conduit delivers
such notice, each Committed Purchaser shall sell to the Conduit and
the Conduit shall purchase in full
from
each Committed Purchaser, the Investment of the Committed
Purchasers on the last day of the relevant Tranche Periods, at a
purchase price equal to such Investment plus accrued and unpaid
Discount thereon. Any sale from any Committed Purchaser to the
Conduit pursuant to this Section 2.2 shall be without
recourse, representation or warranty except for the representation
and warranty that the Investment sold by such Committed Purchaser
is free and clear of any Adverse Claim created or granted by such
Committed Purchaser and that such Committed Purchaser has not
suffered a Bankruptcy Event.
Section 2.3. Allocations and Distributions .
(a) Settlement Dates. On the
Business Day following each Deposit Date occurring prior to the
Termination Date (unless an Interim Liquidation is in effect), the
Collection Agent shall set aside from Collections the amounts
necessary to make all distributions to the Agent, the Purchasers
and the Collection Agent required by this Section 2.3(a) with
respect to the next succeeding Settlement Date. The balance of such
Collections shall be released to the Seller on a daily basis. On
each Settlement Date prior to the Termination Date (unless an
Interim Liquidation is in effect), all Collections so set aside
during the preceding Settlement Period shall be applied where
applicable by the Collection Agent (or, if the Agent is then in
control of any Collections, by the Agent) in the following
order:
(i) to the Collection Agent, an amount
equal to the Collection Agent Fee due and payable on such
date;
(ii) all fees and other amounts due and
payable to the Agent under the Transaction Documents;
(iii) ratably to the Purchasers, all
Funding Charges and Discount due and payable on such; date
provided, however, that if such date occurs during the
Term-Out Period, the Committed Purchaser’s Ratable Share of
such Collections shall be deposited in the Cash Collateral Account
for application on or after the Maturity Date in accordance with
Section 3.10;
(iv) ratably to the Purchasers, all other
amounts due and payable to the Purchasers under the Transaction
Documents; and
(v) to the Seller.
On the
last day of each Tranche Period for a Eurodollar Tranche or Prime
Tranche, the Collection Agent (or, if the Agent is then in control
of any Collections, the Agent) shall pay Discount due and payable
to such Committed Purchasers from amounts set aside for such
purpose pursuant to Section 3.2(a).
If any part of the Sold Interest in any
Collections is applied to pay any amounts that are recourse
obligations of the Seller pursuant to Section 1.4(c) and after
giving effect to such application the Sold Interest is greater than
100%, the Seller shall pay, as a recourse obligation
for
distribution as part of the Sold Interest in Collections, to the
Collection Agent the amount so applied to the extent necessary so
that after giving effect to such payment the Sold Interest is no
greater than 100%.
(b) Maturity Date and Interim
Liquidations. On each day during any Interim Liquidation and on
each day on and after the Maturity Date, the Collection Agent shall
set aside and hold in trust solely for the account of the Agent,
for the benefit of the Agent and the Purchasers, (or deliver to the
Agent, if so instructed pursuant to Section 3.2(a)) the Sold
Interest in all Collections received on such day and such
Collections shall be allocated in the follow order:
(i) to the Collection Agent until all
amounts owed to the Collection Agent under the Agreement have been
paid in full;
(ii) to the Agent until all amounts owed to the Agent have
been paid in full;
(iii) to the Purchasers until all amounts
owed to the Purchasers have been paid in full;
(iv) to any other Person (other than the
Seller, the Collection Agent or an Originator) to whom any amounts
are owed under the Transaction Documents until all such amounts
have been paid in full; and
(v) to the Seller.
On the
last day of each Tranche Period (unless otherwise instructed by the
Agent pursuant to Section 3.2(a)), the Collection Agent shall
deposit into the Agent’s Account, from such set aside
Collections, all Investment, Discount and Funding Charges allocated
to such Tranche Period and all Tranche Periods that ended before
such date that are payable in accordance with clause
(iii) above. No distributions will be made to pay amounts
under clauses (iv) and (v) until sufficient Collections
have been set aside to pay all outstanding amounts described in
clauses (i) through (iii). All other amounts described in
clauses (i) through (iii) above shall be paid when due.
All distributions by the Agent shall be made ratably within each
priority level in accordance with the respective amounts then due
each Person included in such level unless otherwise agreed by the
Agent and all Purchasers. If any part of the Sold Interest in any
Collections is applied to pay any amounts payable hereunder that
are recourse obligations of the Seller pursuant to
Section 1.4(c) and after giving effect to such application the
Sold Interest is greater than 100%, the Seller shall pay, as a
recourse obligation for distribution in respect of each applicable
Purchaser’s Investment as part of the Sold Interest in
Collections, to the Collection Agent the amount so applied to the
extent necessary so that after giving effect to such payment the
Sold Interest is no greater than 100%.
(c) Cash Collateral Account
Proceeds. On the Termination Date if the Term-Out Period has
occurred, the Agent shall: (i) convert the Cash Collateral
that does not constitute cash into cash proceeds and (ii) use
the Cash Collateral to pay to each Committed Purchaser, ratably
according to the respective outstanding principal amounts of their
respective Cash Secured
Investments, for application, first , the outstanding
principal amounts of the Cash Secured Investments and
second , the unpaid accrued interest on the Cash
Secured Investments (to the extent such funds are available
therefor).
Article III
Administration and
Collections
Section 3.1. Appointment of Collection
Agent . (a) The servicing, administering and collecting of
the Receivables shall be conducted by a Person (the
“Collection Agent” ) designated to so act on
behalf of the Purchasers under this Article III. As the
Initial Collection Agent, Tronox Worldwide LLC is hereby designated
as, and agrees to perform the duties and obligations of, the
Collection Agent. The Initial Collection Agent acknowledges that
the Agent and each Purchaser have relied on the Initial Collection
Agent’s agreement to act as Collection Agent (and the
agreement of any of the sub-collection agents to so act) in making
the decision to execute and deliver this Agreement and agrees that
it will not voluntarily resign as Collection Agent nor permit any
sub-collection agent to voluntarily resign as a sub-collection
agent unless required by law to so resign. At any time after the
occurrence of a Termination Event, the Agent may designate a new
Collection Agent to succeed Tronox Worldwide LLC (or any successor
Collection Agent).
(b) The Initial Collection Agent may
delegate its duties and obligations as Collection Agent to an
Affiliate of the Initial Collection Agent (acting as a
sub-collection agent). Notwithstanding such delegation, the Initial
Collection Agent will remain primarily liable for the performance
of the duties and obligations so delegated, and the Agent and each
Purchaser shall have the right to look solely to the Initial
Collection Agent for such performance. The Agent may at any time
after the occurrence of a Termination Event remove or replace any
sub-collection agent.
(c) If replaced, the Collection Agent
agrees it will terminate, and will cause each existing
sub-collection agent to terminate, its collection activities in a
manner requested by the Agent to facilitate the transition to a new
Collection Agent. The Collection Agent shall cooperate with and
assist any new Collection Agent (including providing access to, and
transferring, all Records and allowing (to the extent permitted by
applicable law and contract) the new Collection Agent to use all
licenses, hardware or software necessary or desirable to collect
the Receivables). The Initial Collection Agent irrevocably agrees
to act (if requested to do so) as the data-processing agent for any
new Collection Agent in substantially the same manner as the
Initial Collection Agent conducted such data-processing functions
while it acted as the Collection Agent in exchange for a fee to be
agreed upon by the Agent and the Initial Collection Agent.
Section 3.2. Duties of Collection
Agent . (a) The Collection Agent shall take, or cause to
be taken, all action necessary or advisable to collect each
Receivable in accordance with this Agreement, the Credit and
Collection Policy and all applicable laws, rules and regulations
using the skill and attention the Collection Agent exercises in
collecting other receivables or obligations owed solely to it;
provided, however, that
the
Collection Agent may not sell any Receivables other than to the
extent explicitly required by this Agreement or the Purchase
Agreement. The Collection Agent shall, in accordance herewith, set
aside all Collections to which a Purchaser is entitled and pay from
such Collections all Funding Charges and Discount when due under
Section 2.3. If so instructed by the Agent, after the
occurrence of a Termination Event, the Collection Agent shall
transfer to the Agent the amount of Collections to which the Agent
and the Purchasers are entitled by the second Business Day
following receipt. Each party hereto hereby appoints the Collection
Agent to enforce such Person’s rights and interests in the
Receivables, but (notwithstanding any other provision in any
Transaction Document) the Agent shall at all times after the
occurrence of a Termination Event have the sole right to direct the
Collection Agent to commence or settle any legal action to enforce
collection of any Receivable.
(b) If no Termination Event has occurred and
is continuing and the Collection Agent determines that such action
is appropriate in order to maximize the Collections, the Collection
Agent may, in accordance with the Credit and Collection Policy,
extend the maturity of any Receivable or adjust the Outstanding
Balance of any Receivable. Any such extension or adjustment will
not alter the status of a Receivable as a Defaulted Receivable or
Delinquent Receivable or limit any rights of the Agent or the
Purchasers hereunder. If a Termination Event has occurred and is
continuing, the Collection Agent may make material extensions or
adjustments to such Receivables only with the prior consent of the
Instructing Group or as required by law.
(c) The Collection Agent shall
transfer (i) to the Seller any percentage of Collections in
excess of the Sold Interest, less all reasonable costs and expenses
of the Collection Agent or its agent for servicing, collecting and
administering the Receivables and (ii) to each Originator,
subject to Section 1.5(d), the collections and records for any
indebtedness owed to each Originator that is not a Receivable. The
Collection Agent shall have no obligation to remit any such funds
or records to the Seller or either Originator, as applicable, until
the Collection Agent receives evidence (satisfactory to the Agent)
that the Seller or either Originator, as applicable is entitled to
such items. The Collection Agent has no obligations concerning
indebtedness that is not a Receivable other than to deliver the
collections and records for such indebtedness to the Seller when
required by this Section 3.2(c).
(d) The Collection Agent shall take all
actions necessary to maintain the perfection and priority of the
security interest of the Agent in the Receivables.
(e) The Collection Agent shall take
all actions necessary to ensure that no Collections are applied for
any purpose on dates other than Settlement Dates hereunder unless
after taking into account such application the Net Receivables
Balance exceeds the sum of the Aggregate Investment plus the
Aggregate Reserve on such dates.
Section 3.3. Reports . On or before
each Reporting Date, and at such other times covering such other
periods as is requested by the Agent or the Instructing Group, the
Collection Agent shall deliver to the Agent a report reflecting
information as of the close of business of the Collection Agent for
the immediately preceding Settlement Period or such other preceding
period as is requested (each a “Periodic Report”
), containing the
information described on Exhibit C (with such modifications or
additional information as reasonably requested by the Agent or the
Instructing Group).
Section 3.4. Lock-Box Arrangements .
The Agent is hereby authorized to give notice at any time after the
occurrence of a Termination Event to any or all Lock-Box Banks that
the Agent is exercising its rights under the Lock-Box Letters and
to take all actions permitted under the Lock-Box Letters. The
Seller agrees to take any action requested by the Agent to
facilitate the foregoing. After the Agent takes any such action
under the Lock-Box Letters, the Seller shall immediately deliver to
the Agent any Collections received by the Seller comprising part of
the Sold Interest. If the Agent takes control of any Lock-Box
Account, the Agent shall distribute Collections it receives in
accordance herewith and shall deliver to the Collection Agent, for
distribution under Section 3.2, all other amounts it receives
from such Lock-Box Account.
Section 3.5. Enforcement Rights .
(a) The Agent may at any time after the occurrence of a
Termination Event direct the Obligors and the Lock-Box Banks to
make all payments on the Receivables (and pursuant to the Lock-Box
Letters, the Lock-Box Banks to remit all Collections) directly to
the Agent or its designee. The Agent may, and the Seller shall at
the Agent’s request, withhold the identity of the Purchasers
from the Obligors and Lock-Box Banks unless required by law to do
otherwise. Upon the Agent’s request after the occurrence of a
Termination Event, the Collection Agent on behalf of the Seller (at
the Seller’s expense) shall (i) give notice to each
Obligor of the Agent’s ownership of the Sold Interest and
direct that payments on Receivables be made directly to the Agent
or its designee, (ii) assemble for the Agent all Records and
collateral security for the Receivables and the Related Security
and transfer to the Agent (or its designee), or (to the extent
permitted by applicable law and contract) license to the Agent (or
its designee) the use of, all software useful to collect the
Receivables and (iii) segregate in a manner acceptable to the
Agent all Collections the Seller receives and, promptly upon
receipt, remit such Collections in the form received, duly endorsed
or with duly executed instruments of transfer, to the Agent or its
designee.
(b) After the occurrence of a Termination
Event, the Seller hereby irrevocably appoints the Agent as its
attorney-in-fact coupled with an interest, with full power of
substitution and with full authority in the place of the Seller, to
take any and all steps deemed desirable by the Agent, in the name
and on behalf of the Seller to (i) collect any amounts due
under any Receivable, including endorsing the name of the Seller on
checks and other instruments representing Collections and enforcing
such Receivables and the Related Security, and (ii) exercise
any and all of the Seller’s rights and remedies under the
Purchase Agreement. The Agent’s powers under this Section
3.5(b) do not subject the Agent to any liability if any action
taken by it proves to be inadequate or invalid (unless such action
is due to the Agent’s gross negligence or willful
misconduct), nor do such powers confer any obligation whatsoever
upon the Agent.
(c) Neither the Agent nor any
Purchaser has any obligation to take or consent to any action to
realize upon any Receivable or Related Security or to enforce any
rights or remedies related thereto.
Section 3.6. Collection Agent Fee .
On each Settlement Date, the Seller shall pay to the Collection
Agent a fee for the immediately preceding Settlement Period as
compensation for its services (the “Collection Agent
Fee” ) equal to (a) at all times the Initial
Collection Agent or one of its Affiliates is the Collection Agent,
the Collection Agent Fee Rate divided by twelve multiplied by the
Outstanding Balance of all Receivables as of the first day of the
calendar month preceding the calendar month in which such
Settlement Date occurs, provided that the Collection Agent
Fee paid on the first Settlement Date shall be equal to the
Collection Agent Fee Rate divided by twelve multiplied by a
fraction, the numerator of which is equal to the number of days
elapsed from the date hereof (but not including the date hereof) to
and including the first Settlement Date and the denominator of
which is 30, multiplied by the Outstanding Balance of all
Receivables as of the date hereof, and (b) at all times any
other Person is the Collection Agent, a reasonable amount agreed
upon by the Agent and the new Collection Agent on an
arm’s-length basis reflecting rates and terms prevailing in
the market at such time. The Collection Agent Fee is payable solely
as provided in Section 2.3.
Section 3.7. Responsibilities of the
Seller . The Seller shall, or shall cause each Originator to,
pay when due all Taxes payable in connection with the Receivables
and the Related Security or their creation or satisfaction. The
Seller shall, and shall cause each Originator to, perform all of
such Person’s obligations under agreements related to the
Receivables and the Related Security to the same extent as if
interests in the Receivables and the Related Security had not been
transferred hereunder or, in the case of each Originator, under the
Purchase Agreement. The Agent’s or any Purchaser’s
exercise of any rights hereunder do not relieve the Seller or
either Originator from such obligations. Neither the Agent nor any
Purchaser has any obligation to perform any obligation of the
Seller or of either Originator or any other obligation or liability
in connection with the Receivables or the Related Security.
Section 3.8. Actions by Seller . The
Seller shall defend and indemnify the Agent and each Purchaser
against all costs, expenses, claims and liabilities for any action
taken by the Seller, either Originator or any other Affiliate of
the Seller or of either Originator (whether acting as Collection
Agent or otherwise) related to any Receivable and the Related
Security, or arising out of any alleged failure of compliance of
any Receivable or the Related Security with the provisions of any
law or regulation. If any goods related to a Receivable are
repossessed, the Seller agrees to resell, or to have the applicable
Originator or another Affiliate resell, such goods in a
commercially reasonable manner for the account of the Agent and
remit, or have remitted, to the Agent the Purchasers’ share
in the gross sale proceeds thereof net of any out-of-pocket
expenses and any equity of redemption of the Obligor thereon. Any
such moneys collected by the Seller or the Originators or other
Affiliate of the Seller pursuant to this Section 3.8 shall be
treated as part of the Sold Interest in Collections for application
as provided herein.
Section 3.9. Indemnities by the
Collection Agent. Without limiting any other rights any Person
may have hereunder or under applicable law, the Collection Agent
hereby indemnifies and holds harmless the Agent, each Purchaser,
each Conduit Funding Source and their respective officers,
directors, agents and
employees (each a “Collection Agent Indemnified
Party” ) from and against any and all damages, losses,
claims, causes of action, liabilities, penalties, Taxes (not
including Taxes described in Section 6.4 hereof), costs and
expenses (including reasonable attorneys’ fees and court
costs) (all of the foregoing collectively, the “Collection
Agent Indemnified Losses” ) at any time imposed on or
incurred by any Collection Agent Indemnified Party to the extent
arising out of or otherwise relating to:
(i) any representation or warranty made by,
on behalf of or in respect of, the Collection Agent in this
Agreement, any other Transaction Document, any Periodic Report or
any other information or report delivered by the Collection Agent
pursuant hereto, which was false or incorrect in any material
respect when made;
(ii) the failure by the Collection Agent to
comply with any applicable law, rule or regulation related to any
Receivable or the Related Security;
(iii) any loss of a perfected security
interest (or in the priority of such security interest) as a result
of any commingling by the Collection Agent of funds to which the
Agent or any Purchaser is entitled hereunder with any other
funds;
(iv) the imposition of any Lien with
respect to any Receivable, Related Security or Lock-Box Account as
a result of any action taken by the Collection Agent other than any
Lien imposed under any Transaction Documents;
(v) the failure of any Receivable reported
by the Collection Agent as part of the Eligible Receivables Balance
in any Periodic Report to have been an Eligible Receivable as of
the last day of the Settlement Period for which such Periodic
Report was prepaid; or
(vi) any failure of the Collection Agent to
perform its duties or obligations in accordance with the provisions
of this Agreement (including, without limitation, compliance with
the Credit and Collection Policy) or any other Transaction Document
to which the Collection Agent is a party;
whether
arising by reason of the acts to be performed by the Collection
Agent hereunder or otherwise, excluding only Collection Agent
Indemnified Losses to the extent (a) such Collection Agent
Indemnified Losses to the extent resulting from gross negligence or
willful misconduct of the Collection Agent Indemnified Party
seeking indemnification or to the extent resulting from the breach
of a representation, warranty or covenant by such Collection Agent
Indemnified Party, (b) solely due to the credit risk of the Obligor
and for which reimbursement would constitute recourse to the
Collection Agent for uncollectible Receivables, or (c) such
Collection Agent Indemnified Losses include Taxes on, or measured
by, the overall net income of such Collection Agent Indemnified
Party computed in accordance with the Intended Tax
Characterization; provided, however, that nothing contained
in this sentence limits the liability of the Collection Agent or
limits the recourse of the Agent and each Purchaser to the
Collection Agent for any amounts otherwise specifically provided to
be paid by the Collection Agent hereunder.
Section 3.10. Cash Collateral Account.
(a) On or prior to the date five (5) Business Days
following the delivery by the Seller to the Agent of the Term-Out
Activation Notice, the Seller shall cause to be established, in the
name of the Agent for the Committed Purchasers, an account with the
Agent (the “Cash Collateral Account” ), bearing
a designation clearly indicating that the funds deposited therein
are held for the benefit and security of the Committed
Purchasers.
(b) The Seller hereby agrees that it shall
use the proceeds of the Cash Secured Investments solely to fund and
maintain the Cash Collateral Account for the purpose of funding
Investments from time to time during the Term-Out Period.
(c) Funds on deposit in the Cash
Collateral Account shall be invested, so long as a Potential
Termination Event or a Termination Event has not occurred or is
continuing, by the Collection Agent in Permitted Investments and
credited to the Cash Collateral Account, on behalf of the Seller,
provided, that it is understood and agreed that none of the
Agent, the Seller or the Collection Agent shall be liable for any
loss arising from such investment in Permitted Investments. All
such Permitted Investments shall be held by or on behalf of the
Seller for the benefit and security of the Committed Purchasers.
Except as permitted in writing by the Agent, funds on deposit in
the Cash Collateral Account shall be invested in Permitted
Investments that will mature so that such funds will be available
at the close of business on the next Settlement Date. No Permitted
Investment shall be sold or otherwise disposed of prior to its
scheduled maturity unless a default occurs with respect to such
Permitted Investment and the Agent directs the Collection Agent in
writing to dispose of such Permitted Investment.
(d) The Seller hereby grants to the Agent,
for its own benefit and for the ratable benefit of all of the
Committed Purchasers, a lien on and security interest in the Cash
Collateral Account, all funds from time to time credited to the
Cash Collateral Account, all financial assets (including, without
limitation, Permitted Investments) from time to time acquired with
any such funds or otherwise credited to the Cash Collateral
Account, all interest, dividends, cash, instruments and other
investment property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all
of such funds or such financial assets, all proceeds of, collateral
for, and supporting obligations relating to any and all of the Cash
Collateral. At all times the Cash Collateral Account shall be under
the control (as defined in Section 8-106 of the UCC) of the
Agent for the benefit and security of the Committed Purchasers. The
grant of a security interest by the Seller to the Agent of and for
the ratable benefit of the Committed Purchasers, pursuant to hereto
secures the payment of the Seller’s obligation to remit the
proceeds of the Cash Secured Investments, and to pay
Discount.
Article IV
Representations and
Warranties
Section 4.1. Representations and
Warranties . The Seller represents and warrants to the Agent
and each Purchaser that:
(a) Existence and Power. Each of the
Seller and each Seller Entity is duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization and has all power and authority and all governmental
licenses, authorizations, consents and approvals required to carry
on its business in each jurisdiction in which its business is now
conducted, except where failure to obtain such license,
authorization, consent or approval would not have a Material
Adverse Effect.
(b) Authorization and No
Contravention. The execution, delivery and performance by each
of the Seller and each Seller Entity of each Transaction Document
to which it is a party and the creation of all security interests
provided for herein and therein (i) are within its corporate
powers, (ii) have been duly authorized by all necessary
corporate action, (iii) do not contravene or constitute a
default under (A) any applicable law, rule or regulation,
(B) its or any other Seller Entity’s organizational
documents or (C) any agreement, order or other instrument to
which it or any other Seller Entity is a party or its property is
subject and (iv) will not result in any Adverse Claim on any
Receivable, the Related Security or Collection or give cause for
the acceleration of any indebtedness of the Seller or any other
Seller Entity.
(c) No Consent Required. No
approval, authorization or other action by, or filings with, any
Governmental Authority or other Person is required in connection
with the execution, delivery and performance by the Seller or any
Seller Entity of any Transaction Document to which it is a party or
any transaction contemplated thereby other than UCC financing
statements.
(d) Binding Effect. Each Transaction
Document to which the Seller or any Seller Entity is a party
constitutes the legal, valid and binding obligation of such Person
enforceable against that Person in accordance with its terms,
except as limited by bankruptcy, insolvency, or other similar laws
of general application relating to or affecting the enforcement of
creditors’ rights generally and subject to general principles
of equity.
(e)
UCC Representations and Warranties.
(1) This Agreement creates a valid and
continuing security interest (as defined in the applicable UCC) in
the Receivables, Related Security, Collections, Lock-Box Accounts,
and the Purchase Agreement in favor of the Agent, which security
interest is prior to all other Adverse Claims, and is enforceable
as such against creditors of and purchasers from Seller.
(2) Each Eligible Receivable constitutes an
“account” within the meaning of the applicable
UCC.
(3) Seller owns and has good and marketable
title to the Receivables, Related Security, and Collections free
and clear of any Adverse Claim, claim, or encumbrances of any
Person.
(4) Seller has caused or will have caused,
within ten days, the filing of all appropriate financing statements
in the proper filing office in the appropriate jurisdictions under
applicable law in order to perfect the security interest in the
Receivables, Related Security, and Collections granted to the Agent
hereunder.
(5) Other than the security interest
granted to the Agent pursuant to this Agreement, Seller had not
pledged, assigned, sold, granted a security interest in, or
otherwise conveyed any of the Receivables, Related Security, or
Collections. Seller has not authorized the filing of and is not
aware of any financing statements against Seller that include a
description of collateral covering the Receivables, Related
Security, or Collections other than any financing statement
relating to the security interest granted to the Agent hereunder or
that has been terminated or partially released to the extent
necessary to cover the collateral in which a security interest is
granted hereunder. Debtor is not aware of any judgment or tax lien
filings against Seller.
(f) Accuracy of Information. All
information furnished by the Seller, any Seller Entity or any
Affiliate of any such Person to the Agent or any Purchaser in
connection with any Transaction Document, or any transaction
contemplated thereby, is true and accurate in all material respects
(and is not incomplete by omitting any information necessary to
prevent such information from being materially misleading).
(g) No Material Litigation . No
litigation, investigation or proceeding of or before any arbitrator
or Governmental Authority is pending or, to the knowledge of the
Seller, threatened by or against, the Seller or any of the Seller
Entities or against any of their respective properties or revenues
(a) with respect to any of the Transaction Documents or any of
the transactions contemplated hereby or thereby that could
reasonably be expected to be materially adverse to the Agent or the
Purchasers, or (b) except for the matter described on
Schedule 4.1 hereto, that could reasonably be expected to have
a Material Adverse Effect.
(h) No Material Adverse Effect.
Since August 31, 2007, there has been no Material Adverse
Effect except for the matter described on Schedule 4.1
hereto.
(i) Accuracy of Exhibits; Lock-Box
Arrangements. All information on Exhibits D-F (listing offices
and names of the Seller and each Originator and where they maintain
Records; and Lock Boxes) is true and complete, subject to any
changes permitted by, and notified to the Agent in accordance with,
Article V. None of the Seller’s or Originators’
jurisdictions of organization, have changed within the past
12
months (or such
shorter period as the Seller has been in existence). Neither the
Seller nor either Originator has been known by or used any
organizational, fictitious or trade name within the past
12 months other than a name set forth of Exhibit D.
Exhibit D lists the federal employer identification numbers of
the Seller and each Originator. The Seller has not granted any
interest in any Lock-Box or Lock-Box Account to any Person other
than the Agent and, upon delivery to a Lock-Box Bank of the related
Lock-Box Letter, the Agent will have exclusive ownership and
control of the Lock-Box Account at such Lock-Box Bank.
(j) Sales by the Originators . Each
sale by an Originator to the Seller of an interest in Receivables
and their Collections has been made in accordance with the terms of
the Purchase Agreement, including the payment by the Seller to each
Originator of the purchase price described in the Purchase
Agreement. Each such sale has been made for “reasonably
equivalent value” (as such term is used in
Section 548 of the Bankruptcy Code) and not for or on account
of “antecedent debt” (as such term is used in
Section 547 of the Bankruptcy Code) owed by either Originator
to the Seller.
(k) Eligible Receivables. Each
Receivable comprising part of the Net Receivables Balance as of the
date of any calculation of the Sold Interest as part of the Net
Receivables Balance was an Eligible Receivable as of the date of
such calculation.
(l) Use of Proceeds. No proceeds of
any Purchase will be used (i) for the purpose which violates,
or would be inconsistent with, Regulation T, U or X
promulgated by the Board of Governors of the Federal Reserve System
from time to time or (ii) to acquire any security in any
transaction which is subject to Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended.
(m) No Subsidiaries. The Seller has no
subsidiaries.
(n) Not an Investment Company. No
Seller Entity is an “investment company” within the
meaning of the Investment Company Act of 1940, as amended from time
to time, or any successor statute.
Section 4.2. Representations and
Warranties of the Initial Collection Agent. The Initial
Collection Agent represents and warrants to the Agent and each
Purchaser that:
(a) Lock-Box Arrangements. The
Initial Collection Agent has not granted any interest in any
Lock-Box or Lock-Box Account to any Person other than (i) the
Agent and (ii) Persons whose interests therein have been
terminated on or prior to the date hereof and, upon delivery to a
Lock-Box Bank of the related Lock-Box Letter, the Agent will have
the right to exercise exclusive ownership and control of the
Lock-Box Account at such Lock-Box Bank in accordance with the
provisions of the related Lock-Box Letter.
(b) Not an Investment Company. The
Initial Collection Agent is not an “investment company”
within the meaning of the Investment Company Act of 1940, as
amended from time to time, or any successor statute.
(c) Accuracy of Exhibits. All
information on Exhibits E and F is true and complete, subject to
any changes permitted by, and notified to the Agent in accordance
with Article V.
(d) Eligible Receivables. Each
Receivable which the Initial Collection Agent has identified as
comprising part of the Net Receivables Balance as of the date of
any calculation of the Sold Interest as part of the Net Receivables
Balance in a Periodic Report was an Eligible Receivable as of the
date of such calculation; provided that in no event shall
the Agent or any Purchaser have any recourse against the Initial
Collection Agent under this clause (d) for any determination
that a Receivable reported as eligible in a prior Periodic Report
no longer comprises part of the Net Receivables Balance.
Article V
Covenants
Section 5.1. Covenants of the Seller
. The Seller hereby covenants and agrees to comply with the
following covenants and agreements, unless the Agent (with the
consent of the Instructing Group) otherwise consents:
(a) Financial Reporting . The
Seller shall, and shall cause each Seller Entity to, maintain a
system of accounting established and administered in accordance
with GAAP and shall furnish to the Agent and each Purchaser:
(i) Annual Financial Statements.
Within 120 days after each fiscal year of (A) the Parent
copies of its annual audited financial statements (including a
consolidated balance sheet, consolidated statement of operations
and consolidated statement of cash flows, with related footnotes)
certified by independent registered public accountants satisfactory
to the Agent and prepared on a consolidated basis in conformity
with GAAP, and (B) the Seller the annual balance sheet and an
annual profit and loss statement certified by a Designated
Financial Officer thereof, in each case prepared on a consolidated
basis in conformity with GAAP as of the close of such fiscal year
for the fiscal year then ended provided, that so long as any
document described in this subsection is publicly filed with the
Securities and Exchange Commission, it shall not be required to be
delivered by the Parent, Seller or any Seller Entity;
(ii) Quarterly Financial Statements.
Within 60 days after each (except the last) fiscal quarter of
each fiscal year of (A) the Parent, copies of its unaudited
financial statements (including at least a consolidated balance
sheet as of the close of such quarter and statements of operations
and cash flows for the period from the beginning of the fiscal year
to the close of such quarter) certified by a Designated Financial
Officer and prepared in a manner consistent with the financial
statements described in part (A) of clause (i) of this
Section 5.l(a) and (B) the Seller, the quarterly balance
sheet (a profit and
loss statement)
for the period from the beginning of such fiscal year to the close
of such quarter, in each case certified by a Designated Financial
Officer thereof and prepared in a manner consistent with part
(B) of clause (i) of Section 5.1(a) provided, that
so long as any document described in this subsection is publicly
filed with the Securities and Exchange Commission, it shall not be
required to be delivered by the Parent, Seller or any Seller
Entity; and
(iii) Other Information. With
reasonable promptness, such other information (including
non-financial information) as may be reasonably requested by the
Agent or any Purchaser (with a copy of such request to the
Agent).
(b) Notices . Immediately upon
becoming aware of any of the following the Seller will notify the
Agent and provide a description of:
(i)
Potential Termination Events. The occurrence of any
Potential Termination Event;
(ii) Representations and Warranties.
The failure of any representation or warranty herein to be true
(when made or at any time thereafter) in any material
respect;
(iii) Downgrading. The downgrading,
withdrawal or suspension of any rating by any rating agency of any
indebtedness of the Parent;
(iv) Litigation. (A) The
institution of any litigation or proceeding against or instituted
by, the Seller, or (B) the institution of any litigation or
proceeding against or instituted by, any of the Seller Entities
other than the Seller (i) if the litigation or proceeding does
not involve any Environmental Law, in which the amount involved
could reasonably be expected to be $10,000,000 or more and not
covered by insurance, (ii) if the litigation or proceeding
involves any Environmental Law, in which the amount involved that
is not covered by insurance could reasonably be expected to be
$50,000,000 or more, or (C) the institution of any litigation or
proceeding which involves any Transaction Document; or
(v) Changes in Business. Any change
in, or proposed change in, the character of any Seller
Entity’s business that could impair the collectibility or
quality of any Receivable.
(vi) Breach of Purchase Agreement.
Any material breach or default by either Originator under the
Purchase Agreement.
If the
Agent receives such a notice, the Agent shall promptly give notice
thereof to each Purchaser.
(c) Conduct of Business. The
Seller shall, and shall cause each Seller Entity to (a) (i)
preserve, renew and keep in full force and effect its corporate or
other existence and (ii) take all reasonable action to
maintain all rights, privileges, franchises, Permits and licenses
necessary or
desirable in the normal conduct of its business, except, in each
case, as otherwise permitted by Section 7.4 of the Parent
Credit Agreement (as in effect as of the date hereof) and except,
in the case of clause (ii) above, to the extent that failure
to do so could not reasonably be expected to have a Material
Adverse Effect; and (b) comply with (i) all Material
Contractual Obligations (as such term is defined in the Parent
Credit Agreement as in effect as of the date hereof) and (ii) all
Permits (as such term is defined in the Parent Credit Agreement as
in effect as of the date hereof), except to the extent that failure
to comply therewith could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(d) Furnishing Information and
Inspection of Records. The Seller shall furnish to the Agent
and the Purchasers such information concerning the Receivables and
the Related Security as the Agent or a Purchaser may reasonably
request. The Seller shall, and shall cause each Originator to,
permit, at any time during regular business hours and upon
reasonable notice, the Agent or any Purchaser (or any
representatives thereof) (i) to examine and make copies of all
Records, (ii) to visit the offices and properties of the
Seller and each Originator for the purpose of examining the Records
and (iii) to discuss matters relating hereto with any of the
Seller’s or either Originator’s officers, directors,
employees or independent public accountants having knowledge of
such matters provided, that prior to a Termination Event, any such
examinations or visits in excess of one per calendar year shall be
at Agent’s expense. The Agent may at any time have an
independent public accounting firm conduct an audit of the Records
or make test verifications of the Receivables and Collections;
provided, however, prior to a Termination Event, only one
such audit per calendar year shall be at the expense of the Seller.
The Agent will make reasonable efforts to consult with the Seller
in choosing an independent public accounting firm to conduct such
audits.
(e) Keeping Records.
(i) The Seller shall, and shall cause each Originator to, have
and maintain (A) administrative and operating procedures
(including an ability to recreate Records if originals are
destroyed), (B) adequate facilities, personnel and equipment
and (C) all Records and other information necessary or
advisable for collecting the Receivables (including Records
adequate to permit the immediate identification of each new
Receivable and all Collections of, and adjustments to, each
existing Receivable). The Seller shall give the Agent prior notice
of any material change in such administrative and operating
procedures.
(ii) The Seller shall, (A) at all
times from and after the date hereof, clearly and conspicuously
mark its computer and master data processing books and records with
a legend describing the Agent’s and the Purchasers’
interest in the Receivables and the Collections and (B) upon
the request of the Agent, so mark each contract relating to a
Receivable and deliver to the Agent all such contracts (including
all multiple originals of such contracts) that constitute
collateral in which perfection of a security interest can be
obtained by possession under the Uniform Commercial Code, with any
appropriate endorsement or assignment, or segregate (from all other
receivables then owned or being serviced by the Seller) the
Receivables and all contracts relating to each Receivable and hold
in trust and safely keep such contracts so legended in separate
filing cabinets or other suitable containers at such locations as
the Agent may specify.
(f) Perfection. (i) The
Seller shall, and shall cause each Originator to, at its expense,
promptly execute and deliver all instruments and documents and take
all action necessary or requested by the Agent (including the
filing of financing or continuation statements, amendments thereto
or assignments thereof) to enable the Agent to exercise and enforce
all its rights hereunder and to vest and maintain vested in the
Agent a valid, first priority perfected security interest in the
Receivables, the Collections, the Related Security, the Purchase
Agreement, the Lock-Box Accounts and proceeds thereof free and
clear of any Adverse Claim (other than the Seller’s interest
therein) (and a perfected ownership interest in the Receivables and
Collections to the extent of the Sold Interest); provided,
however , that the Seller’s and the Originators’
obligations to deliver the Lock-Box Agreements and Lock-Box Letters
in connection with this subsection (f) shall be subject to the
grace period provided in Section 5.1(q) hereof. The Agent is
permitted to prepare and file any continuation statements,
amendments thereto and assignments thereof against the Seller. In
order to maintain perfection of such security interests, the Seller
hereby appoints the Agent as its designee to prepare and file any
continuation statements, amendments thereto and assignments thereof
against each Seller Entity.
(ii) The Seller shall, and shall cause each
Originator to, only change its name, identity or corporate
structure or relocate its jurisdiction of organization or chief
executive office or any Records in tangible form following thirty
(30) days advance written notice to the Agent and the delivery
to the Agent of all financing statements, instruments and other
documents (including direction letters) requested by the
Agent.
(iii) Each of the Seller and each
Originator shall at all times maintain its jurisdiction of
organization within a State of the USA in which Article 9 of
the Uniform Commercial Code (as in effect in such State) is in
effect. If any Seller Entity changes its jurisdiction of
organization to a jurisdiction that imposes fees or other charges
to perfect the Agent’s security interest hereunder or the
Seller’s security interest under the Purchase Agreement, the
Seller shall pay all such amounts and any other costs and expenses
incurred in order to perfect and maintain such security
interests.
(g) Performance of Duties. The
Seller shall perform, and shall cause each Seller Entity and the
Collection Agent (if an Affiliate) to perform, its respective
duties or obligations in accordance with the provisions of each of
the Transaction Documents. The Seller (at its expense) shall, and
shall cause each Seller Entity to, (i) fully and timely
perform in all material respects all agreements required to be
observed by it in connection with each Receivable, (ii) comply
in all material respects with the Credit and Collection Policy, and
(iii) refrain from any action that may impair the rights of
the Agent or the Purchasers in the Receivables, the Related
Security, Collections, Purchase Agreement or Lock-Box
Accounts.
(h) Payments on Receivables,
Accounts. The Seller shall, and shall cause each Originator to,
at all times instruct all Obligors to deliver payments on the
Receivables (including Deemed Collections) to a Lock-Box or
Lock-Box Account. If any such payments or other Collections are
received by the Seller or either Originator, it shall hold such
payments in trust for the benefit of the Agent and the Purchasers
and promptly (but in any event within two Business Days after
receipt) remit such funds into a Lock-Box Account. The Seller shall
cause each Lock-Box Bank to comply with the terms of each
applicable Lock-Box Letter. The Seller shall
not
permit the funds of any Affiliate to be deposited into any Lock-Box
Account; provided, however, that notwithstanding the
foregoing, the Seller may permit amounts received with respect to
non-trade receivable related payments from Lockbox #23850
maintained with JPMorgan Chase Bank, N.A. to be deposited into the
same Lock-Box Account as Collections provided that the Seller shall
make reasonable efforts to identify and segregate such amounts from
Collections as soon as possible. If such funds are nevertheless
deposited into any Lock-Box Account, the Seller shall promptly
identify and separate such funds for segregation. The Seller shall
make reasonable efforts to not, and not permit any Collection Agent
or other Person to, commingle Collections or other funds to which
the Agent or any Purchaser is entitled with any other funds;
provided, however, that notwithstanding the foregoing, the
Seller may permit amounts received with respect to non-trade
receivable related payments from Lockbox #23850 maintained with
JPMorgan Chase Bank, N.A. to be deposited into the same Lock-Box
Account as Collections provided that the Seller shall make
reasonable efforts to identify and segregate such amounts from
Collections as soon as possible. The Seller shall only add, and
shall only permit either Originator to add, a Lock-Box Bank,
Lock-Box, or Lock-Box Account to those listed on Exhibit F if
the Agent has received notice of and has consented to such
addition, and has received a copy of any new Lock-Box Agreement and
an executed and acknowledged copy of a Lock-Box Letter acceptable
to the Agent from any new Lock-Box Bank. The Seller shall only
terminate a Lock-Box Bank or Lock-Box, or close a Lock-Box Account,
upon 30 days advance notice to the Agent.
(i) Sales and Adverse Claims
Relating to Receivables. Except as otherwise provided herein,
the Seller shall not, and shall not permit either Originator to,
(by operation of law or otherwise) dispose of or otherwise
transfer, or create or suffer to exist any Adverse Claim upon, any
Receivable or any proceeds thereof.
(j) Extension or Amendment of
Receivables. Except as otherwise permitted in
Section 3.2(b) and then subject to Section 1.5, t
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