Exhibit 10.2
EXECUTION COPY
RECEIVABLES SALE
AGREEMENT
Dated: September 8,
2009
Among
JDER Limited,
as Assignee
JOHNSONDIVERSEY UK
LIMITED,
as Originator
TABLE OF CONTENTS
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Page
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ARTICLE I
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DEFINITIONS
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1
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ARTICLE II
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PURPOSE
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4
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ARTICLE III
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ENTRY INTO
FORCE, TERM; PURCHASE AND SALE; PURCHASE PRICE
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4
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ARTICLE IV
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CONDITIONS OF
PURCHASE
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15
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ARTICLE V
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REPRESENTATIONS
AND WARRANTIES, COVENANTS
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15
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ARTICLE VI
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ADDITIONAL
RIGHTS AND OBLIGATIONS IN RESPECT OF RECEIVABLES
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ARTICLE VII
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INDEMNIFICATION
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ARTICLE VIII
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NOTICES
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ARTICLE IX
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ASSIGNMENT OF
CONTRACT – AMENDMENT – POWER OF ATTORNEY
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ARTICLE X
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GOVERNING LAW
– JURISDICTION
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ARTICLE XI
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LIMITED
RECOURSE
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ARTICLE XII
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NON-PETITION
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ARTICLE XIII
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MISCELLANEOUS
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Schedule 1 – Form of Global
Letter of Offer
Schedule 2 – Form of UK Company
Note
-i-
THIS DEED (THE “UK SALE AGREEMENT”)
IS MADE ON SEPTEMBER 8, 2009:
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1.
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JDER
Limited , an Irish
private limited liability company, as assignee (the
“Assignee”),
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2.
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JOHNSONDIVERSEY UK LIMITED
, a private limited liability
company organised under the laws of the England and Wales as
assignor (the “Originator”),
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PREAMBLE
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A.
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The Originator
desires to offer to sell, transfer and assign to the Assignee all
of the Originator’s right, title and interest in and to a
pool of Receivables originated by it pursuant to its commercial
activities, and to the extent that such Receivables are
“Eligible Receivables,” as set forth herein, the
Assignee is willing to purchase such Eligible
Receivables.
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B.
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The parties
have agreed to set forth, amongst other things, in this UK Sale
Agreement the terms and conditions under which the Originator shall
sell, transfer and assign its right, title and interest in, to and
under such Eligible Receivables to the Assignee.
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C.
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The Originator
and the Assignee intend that the acceptance (evidenced by payment
of the Purchase Price (as defined herein)) by the Assignee of a
Global Letter of Offer (as defined herein) from the Originator (or
its duly authorised designee) shall constitute a true sale from the
Originator to the Assignee of the Eligible Receivables (originated
by the Originator) listed in such Global Letter of Offer, providing
the Assignee with the full benefits of ownership of each such
Eligible Receivable (subject to retention of legal title by the
Originator except in the case of a Termination Event that has
occurred and is continuing). The Originator and the Assignee do not
intend any of the transactions contemplated by this UK Sale
Agreement to be characterised for any purpose as loans from the
Assignee to the Originator.
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D.
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Pursuant to the
Receivables Purchase Agreement, dated as of the date hereof, the
Assignee will sell, transfer and assign an undivided variable
percentage interest (under New York law) in the Eligible
Receivables to Hannover Funding Company LLC, as
Purchaser.
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THIS DEED WITNESSES AS
FOLLOWS:
Article I
DEFINITIONS
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1.1.
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Capitalised
terms not otherwise defined herein shall have the meaning set out
in the Receivables Purchase Agreement, as amended, amended and
restated, modified or supplemented from time to time.
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References herein to the “UK
Sale Agreement” or the “Agreement” shall mean
this Receivables Sale Agreement together with any Global Letters of
Offer (as defined herein) from time to time delivered pursuant
hereto.
“ Eligible Receivable
” means, at any time, a Receivable:
(i) the Obligor of which (a) is
a resident of, or organized under the laws of, or with its chief
executive office in, the United Kingdom; (b) is not an
Affiliate of any of the parties to the Transaction Documents;
(c) is not a Governmental Authority, other than a legal entity
that does not benefit from immunity from being sued for nonpayment
of debt or breach of contract; (d) has not suffered a
Bankruptcy Event which is continuing; and (d) is not a
Defaulted Obligor;
(ii) which has been billed to the
Obligor and according to the terms thereof and any Contract related
thereto is required to be paid in full (subject to any contractual
rebate or discount) no later than ninety (90) days after any
such time and not within the first fifteen (15) days after the
Closing Date;
(iii) which is not a Delinquent
Receivable, Defaulted Receivable or a Charge-Off;
(iv) which is denominated and
payable only in Euro (€) or Pounds Sterling
(£);
(v) which is not subject to offset
by any payables owing to the Obligor by the Originator,
provided , however, that Receivables from such Obligor that
otherwise satisfy all other clauses of this definitions shall be
considered Eligible Receivables to the extent that their combined
balances exceed the sum of all payables owing to such Obligor by
the Originator;
(vi) which arises under a Contract
that is in full force and effect and constitutes the legal, valid
and binding obligation of the related Obligor enforceable against
such Obligor in accordance with its terms except as such
enforceability may be limited by any applicable insolvency law, or
by general principles of law or equity (regardless of whether
enforcement is sought in a proceeding in equity or at
law);
(vii) which arises under a Contract
that (a) contains an obligation to pay a specified sum of
money and is subject to no contingencies, (b) does not contain
an enforceable requirement that the Obligor under such Contract
consent to the transfer, sale or assignment of the rights and
duties of any Originator under such Contract unless the related
Obligor has consented to the assignment of such Receivable,
(c) does not contain a confidentiality provision, and is not
subject to applicable law, that purports to restrict the
Purchaser’s exercise of rights under this Agreement,
including, without limitation, the right to review such Contract,
unless the related obligor has waived such restriction and
(d) is governed by the laws of England;
(viii) which does not, in whole or
in part, contravene any law, rule or regulation applicable
thereto;
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(ix) the transfer, sale or
assignment of which does not contravene any applicable law, rule or
regulation;
(x) which was generated in the
ordinary course of the Originator’s business from the sale of
goods or provision of services to an Obligor by the Originator;
and
(xi) which was created in compliance
with all laws, rulings and regulations applicable to the
transactions under which such Receivables were
generated;
(xii) which is not the subject of
any dispute, offset, hold back defense, Adverse Claim (other than
Permitted Adverse Claims), counterclaim, warranty claim or other
claim or defense (other than unexpired volume on pricing discounts
or rebates to which the Obligor may be entitled); and which does
not arise from the sale of inventory which is subject to any
Adverse Claim (other than Permitted Adverse Claims) covering the
proceeds of such inventory, if such Adverse Claim would extend to
such Receivable;
(xiii) which was created in
accordance with, and which complies with, in each case, the
requirements of the relevant Credit and Collection
Policy;
(xiv) as to which the Originator has
satisfied and fully performed all obligations on its part under the
relevant Contract with respect to such Receivable required to be
fulfilled by it, and no further action is required to be performed
by the Originator under the relevant Contract with respect thereto
in order for such Receivable to become due and payable
hereunder;
(xv) which has not been modified,
extended, renegotiated or restructured since their creation in any
way, except as provided for in the relevant Credit and Collection
Policy;
(xvi) in which the Originator owns
good and marketable title and which is freely assignable by the
Originator;
(xvii) for which the Assignee shall,
upon payment of the Purchase Price in respect of the relevant
Receivables, have a valid and enforceable ownership interest in the
Related Security and Collections with respect thereto, in each case
free and clear of any Adverse Claim (other than Permitted Adverse
Claims and retention of legal title by the Originator except in the
case of a Termination Event that has occurred and is
continuing);
(xviii) in respect of which the
Originator is (A) not in default in any material respect under
the terms of the related Contract from which such Receivable arose
and (B) is directly or indirectly wholly-owned by
JDI;
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(xix) for which the Obligor has been
directed to make all payments to the UK Collection Account which is
subject to the UK Collection Bank Agreement;
(xx) which is not payable in
installments; and
(xxi) any other Receivable approved
in writing by the Agent.
“ Offer Signatories
” means each of Lori Marin, Kathleen Powers, Mark Layton,
Paul Feider, Jennifer Tomaloff and David Schultz, or any other
signatory consented to by the Agent from time to time (such consent
not to be unreasonably withheld).
“ Sale Termination
Event ” means the failure of the Originator (or its duly
authorised designee) to perform any of its responsibilities
described in Clauses 3.2(a) and (b).
“ UK Collection Account
” means the Collection Account established by the Assignee
with Citibank, N.A. (London) and listed as such on Schedule
II to the Receivables Purchase Agreement.
“ UK Collection Bank
” means Citibank, N.A. (London).
“ UK Collection Bank
Agreement ” means each Collection Bank Agreement to which
Citibank, N.A. (London) is a party.
“ UK Originator Account
” means the Originator Account established by the Originator
with Citibank, N.A. (London) and listed as such on Schedule II to
the Receivables Purchase Agreement.
Article II PURPOSE
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2.1.
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The purpose of
this UK Sale Agreement is to set forth:
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(a)
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The terms and
conditions on which the Originator shall irrevocably sell, transfer
and assign the Eligible Receivables to the Assignee;
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(b)
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The terms and
conditions defining the Eligible Receivables;
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(c)
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The
representations, warranties and covenants of the Originator in
relation, in particular but not limited to, to the Eligible
Receivables; and
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(d)
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Generally, the
obligations subscribed by the Originator in relation to the
Eligible Receivables.
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Article III ENTRY INTO FORCE,
TERM; Purchase and Sale; Purchase Price
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3.1.
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Entry into
Force, Term . This UK
Sale Agreement shall enter into force when the Receivables Purchase
Agreement enters into force and shall terminate automatically upon
the termination of the Receivables Purchase Agreement on the
Facility Termination Date.
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(a)
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The Originator
(or its duly authorised designee) will, by no later than 4:00 p.m.
(London time) on each Business Day prior to the Facility
Termination Date on which Eligible Receivables are available for
sale to the Assignee (each such day, an “ Offer Date
”) pursuant to a Daily Report, or by such later time as may
be agreed between the Originator, the Assignee and the Agent,
deliver to the Assignee, by facsimile or electronic mail, with a
copy to each of the Agent and the Servicer, a Global Letter of
Offer substantially in the form of Schedule 1 to this UK Sale
Agreement (a “ Global Letter of Offer ”), signed
(in original or photostatic form) by the Originator or its duly
authorised designee and listing all Eligible Receivables which have
come into existence on or before the relevant Offer Date and which
have not yet been sold to the Assignee in accordance with the terms
of this UK Sale Agreement (each an “ Offered
Receivable ”) as at close of business on the Business Day
immediately prior to the relevant Offer Date. Delivery of a Global
Letter of Offer by the Originator in the manner described in this
Clause 3.2(a) shall constitute due execution of such Global Letter
of Offer for the purposes of this Agreement.
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(c)
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The delivery of
each Global Letter of Offer will constitute an irrevocable offer to
sell, transfer and assign (with full title guarantee and by way of
assignment), without recourse (except to the extent expressly
provided herein) to the Assignee for the Purchase Price on the
terms and subject to the conditions set forth in this UK Sale
Agreement all of such Originator’s present and future right,
title and interest in, to and under:
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(i)
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each Eligible
Receivable of the Originator that existed and was owing to the
Originator at the closing of the Originator’s business on the
date of the initial Payment under the Receivables Purchase
Agreement;
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(ii)
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each Eligible
Receivable thereafter generated by the Originator from and
including the date of the initial Payment under the Receivables
Purchase Agreement until the Facility Termination Date;
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(iii)
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all rights to
(but not the obligations of) the Originator under all Related
Security in respect of each Eligible Receivable generated by the
Originator; and
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(iv)
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all Collections
and proceeds with respect to any of the foregoing and all amounts
on deposit in the UK Collection Account representing proceeds of
such Eligible Receivables and proceeds of the Related Security with
respect thereto, and all certificates and instruments, if any, from
time to time, evidencing such amounts on deposit in the UK
Collection Account.
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The items described in clauses
(iii) through (v) may be referred to collectively as the
“ Related Rights ”, and the Related Rights
together with the items described in clauses (i) and
(ii) may be referred to collectively as the
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“ Receivables
Property .” For the purposes hereof, “Offered
Receivables” means, on any date, all Eligible Receivables
which have come into existence on or before the relevant date and
which have not previously been sold to the Assignee in accordance
with this Clause 3.2 of this UK Sale Agreement.
For the avoidance of doubt, Excluded
Receivables shall not be offered for sale to the Assignee, nor
shall Excluded Receivables be capable of being purchased by the
Assignee hereunder.
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(d)
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Subject to
Article V hereof, the Assignee hereby accepts each offer made from
time to time to purchase all the Offered Receivables and related
Receivables Property pursuant to each Global Letter of Offer; upon
such acceptance and payment in full of the Purchase Price by the
Assignee, all of the Originator’s right, title and interest
in and to those Offered Receivables and the related Receivables
Property shall transfer to the Assignee in accordance with the
terms and conditions hereof, provided that at such time the
Facility Termination Date has not occurred.
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Acceptance will
constitute:
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(A)
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acceptance of
the offer; and
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(B)
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transfer to the
Assignee of all of the Originator’s right, title and interest
in and to those Offered Receivables and the related Receivables
Property.
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(e)
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For the
avoidance of doubt, the Originator and the Assignee hereby confirm
their intention that any purchase and transfer under or pursuant to
this UK Sale Agreement shall constitute a true sale of the relevant
Eligible Receivables and Receivables Property transferred hereunder
and not a security arrangement for any obligations of the
Originator. Such sale of the Eligible Receivables shall be absolute
and irrevocable and shall confer on the Assignee the full benefits
of ownership of the Eligible Receivables (subject to retention of
legal title by the Originator except in the case of a Termination
Event that has occurred and is continuing).
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The Originator will not be liable
for the credit risk relating to an Eligible Receivable and the
parties agree that the credit risk relating to all Receivables
shall pass from the Originator to the Assignee at the same time as
title shall pass in accordance with this UK Sale
Agreement.
Each sale of Offered Receivables and
the related Receivables Property hereunder is made without recourse
to the Originator; provided, however, that:
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(i)
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the Originator
shall be liable to the Assignee for all representations,
warranties, covenants, deemed collection obligations, and
indemnities which it makes pursuant to the express terms of this UK
Sale Agreement; and
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(ii)
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such sale does
not constitute, and is not intended to result in, an assumption by
the Assignee (or any assignee thereof) of, and the Assignee and
such assignees shall not have, any obligation or liability of the
Originator or any other Person to any Obligor or other customer or
client of the Originator or otherwise arising in connection with
the Eligible Receivables or Receivables Property or any other
obligations of the Originator (including any obligation to perform
any obligations of the Originator under any Eligible Receivables
and the related Contracts or other Receivables
Property).
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Notwithstanding any other provision
in this Clause 3.2, the Originator will not be obligated to make
any offer to the Assignee or any other Person of or in respect of
any receivable if at such time the Facility Termination Date has
occurred.
In connection with the purchase by
the Assignee of Eligible Receivables hereunder, the Originator
hereby agrees, to the extent permissible under Data Protection Law
(as defined herein) and the other Transaction Documents and subject
to any obligation of the Originator to retain such records as may
be required by it to comply with its statutory obligations, to sell
and, upon request by the Assignee, to transfer, assign and
otherwise convey at its own expense to the Assignee, or as it may
direct, all of its right and title to and interest in all purchase
orders, delivery records and invoices (including any interim
invoices represented by a final invoice) relating to the Offered
Receivables and Receivables Property with respect thereto, the
applicable Contracts and the related Obligors whether now existing
or hereafter arising (collectively, and including all materials
necessary or desirable to the Assignee to collect such Eligible
Receivables and any Related Rights with respect thereto, the
“ Acquired Receivables Records ”), without the
need for any further documentation in connection therewith,
provided that should Data Protection Law or such other legal
or contractual restrictions as listed above prohibit transmission
of relevant data to the Assignee, the Originator will use all
reasonable efforts to cause such transmission to occur in
compliance with applicable law. The Assignee agrees that the
Originator may retain possession of the Acquired Receivables
Records until the Assignee requests delivery thereof which request
shall not be made prior to the occurrence of a Termination Event
that is continuing. During the occurrence of any Termination Event
contemplated by subsections (a), (b), (c), (m) and (q) of
Exhibit V to the Receivables Purchase Agreement that is continuing,
the Originator shall, at its own expense assemble all of the
records necessary or desirable to collect the Eligible Receivables
sold hereunder and the Related Security, and transfer or license to
any new Servicer the use of all software necessary or desirable to
collect such Eligible Receivables and the Related Security, and
make the same available to the Assignee or its designee at a place
selected by the Assignee (provided that should the consent of any
licensor of such software be required for the grant of the licence
herein to be effective the Originator will use all reasonable
efforts to obtain the consent of such third party licensor). During
the occurrence of any Termination
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Event, the Originator shall, at its
own expense, segregate all cash, cheques and other instruments
received by it from time to time constituting Collections with
respect to such Eligible Receivables in a manner reasonably
acceptable to the Assignee and, promptly upon receipt, remit all
such cash, cheques and instruments, duly endorsed or with duly
executed instruments of transfer, to the Assignee or its designee.
Until any Termination Event has occurred that is continuing, the
Originator shall hold such Acquired Receivables Records on behalf
of the Assignee, which Acquired Receivables Records shall be marked
to indicate that they are the property of the Assignee and shall
not be destroyed or disposed of. The Agent shall be entitled to
inspect and copy such Acquired Receivables Records in accordance
with Article V, Clause 5.4(j). The Originator shall be entitled to
continue to use and make copies of all Acquired Receivables Records
(and shall be entitled to retain all such copies, including after
the Facility Termination Date), and, if the Assignee requires
possession of any Acquired Receivables Records, the Assignee shall
give the Originator reasonable opportunity to make copies of such
documents.
In connection therewith, the
Originator hereby grants to the Assignee (or its permitted
designees, including the Servicer) an irrevocable, non-exclusive
licence (subject to the restrictions contained in any licence with
respect thereto) to use, without royalty or payment of any kind,
all computer software and programs used by the Originator to
account for the Eligible Receivables, to the extent necessary or
desirable to permit the Assignee to exercise its ownership and
other interests acquired under or pursuant to this UK Sale
Agreement, and to administer or service the Eligible Receivables,
whether such software and programs are owned by the Originator or
are owned by others and used by the Originator under licence
agreements with respect thereto, provided that if the terms of any
software licence in favour of the Originator requires the consent
of the licensor for the grant of the licence described herein to be
effective the Originator agrees that it will use all reasonable
efforts to procure such consent. The licence granted hereby shall
be irrevocable, shall not terminate until the Final Payout Date,
and may only be utilized by the Assignee upon the occurrence of any
Termination Event contemplated by subsections (a), (b), (c),
(m) and (q) of Exhibit V to the Receivables Purchase
Agreement that is continuing.
The Originator shall reasonably
cooperate with and assist any Successor Servicer in the performance
of its responsibilities as Servicer under the Servicing Agreement
and under the other Transaction Documents, including (to the extent
permitted by applicable law) providing access to, and transferring,
to such Successor Servicer all Acquired Receivables Records and
allowing (to the extent permitted by applicable law) the Successor
Servicer to use all licences, hardware or software necessary or
reasonably desirable to collect, service, obtain or store
information regarding the Receivables.
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3.3.
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Consideration for Purchases
. On the terms and subject to the
conditions set forth in this UK Sale Agreement, the Assignee agrees
to make Purchase Price payments to the Originator in accordance
with Clause 3.5 hereof. The Originator and the Assignee hereby
confirm that the Purchase Price with respect to any Eligible
Receivable and any Related Rights represent fair consideration,
reasonably equivalent value and the fair market value of such
Eligible Receivables and Related Property.
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3.4.
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Calculation
of Purchase Price . The
“Purchase Price” to be paid to the Originator for the
Receivables shall be determined in accordance with the following
formula:
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PP
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=
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OB x
(1-DF)
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where:
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PP
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=
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Purchase Price
for each Receivable as calculated on the relevant Payment
Date.
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OB
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=
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The Outstanding
Balance of such Receivable on the relevant Payment Date.
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DF
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=
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A percentage
(the “Discount Factor”) calculated to provide the
Assignee with a reasonable return on its investment in the Eligible
Receivables sold hereunder after taking account of (i) the
time value of money based upon the anticipated dates of collection
of such Eligible Receivables and the cost to the Assignee of
financing its investment in such Eligible Receivables during such
period and (ii) the risk of nonpayment by the Obligors. The
Originator and the Assignee may agree from time to time to change
the Discount Factor based on changes in one or more of the items
affecting the calculation thereof, provided that any change
to the Discount Factor shall take effect as of the commencement of
a Calculation Period, shall apply only prospectively and shall not
affect the Purchase Price payment in respect of any sale of
Eligible Receivables by the Originator to the Assignee which
occurred during any Calculation Period ending prior to the
Calculation Period during which the Originator and the Assignee
agree to make such change.
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“Payment Date” means
(i) the Closing Date and (ii) each Originator Business
Day thereafter.
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3.5.
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Payment of Purchase
Price . On the terms and
subject to the conditions set forth in this UK Sale Agreement, the
Assignee agrees to pay to the Originator the Purchase Price for
each purchase to be made hereunder as soon as reasonably
practicable upon receipt of and as set out in the relevant Global
Letter of Offer. The Purchase Price may be satisfied by
(i) full payment in immediately available funds or
(ii) partially by delivery of immediately available funds (in
an amount at least equal to 75% of the face value of such Eligible
Receivable, determined in accordance with GAAP, made available to
the Assignee in connection with its subsequent sale of its interest
in the Eligible Receivables pursuant to the terms of the
Receivables Purchase Agreement) with the balance to be satisfied by
delivery of a Pounds Sterling denominated subordinated promissory
note in the form of Schedule 2 hereto, in favour of the Originator
(such promissory note, as it
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may be amended, supplemented,
amended and restated, endorsed or otherwise modified from time to
time, together with all promissory notes issued from time to time
in substitution therefor or renewal thereof in accordance with the
Transaction Documents, being herein called the “ UK
Company Note ”).
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For the avoidance of doubt, a
portion of the UK Company Note may, for the purposes of this clause
3.5, be deemed by the Originator to be cash to the extent that the
Assignee repays outstanding amounts related to such portion of the
UK Company Note from Available Collections (to the extent that it
is permitted to do so under the terms of the Receivables Purchase
Agreement).
The Originator (or the Servicer on
its behalf) is hereby authorised by the Assignee to endorse on the
UK Company Note, on each Offer Date, an appropriate notation
evidencing the date and amount of each advance thereunder, as well
as the date of each payment with respect thereto, provided that the
failure to make any such notation shall not affect any obligation
of the Assignee thereunder.
On each Offer Date subsequent to the
Closing Date, on the terms and subject to the conditions set forth
in this UK Sale Agreement, the Assignee shall pay to the Originator
the Purchase Price for the Eligible Receivables listed in the
relevant Global Letter of Offer (with respect to such Eligible
Receivables to be sold under this UK Sale Agreement) corresponding
to such Offer Date:
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(a)
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first, in
immediately available funds to the extent the Assignee has such
funds available therefore and such payment is not prohibited under
the Receivables Purchase Agreement; and
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(b)
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second, to the
extent any portion of the Purchase Price remains unpaid, the
principal amount outstanding under the UK Company Note shall be
automatically increased by an amount equal to such remaining
Purchase Price.
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For the avoidance of doubt, any
funds not held or set aside pursuant to Section 1.4(b)(i)(B)
of the Receivables Purchase Agreement shall be applied by the
Assignee in accordance with Section 1.4(b)(i)(F) of the
Receivables Purchase Agreement, to pay any Purchase Price payable
pursuant to clause (a) above prior to any other application.
Notwithstanding the foregoing, the principal balance of the UK
Company Note shall not be increased, no additional Purchase Price
shall be paid by means of the UK Company Note, and no purchase of
the related Receivables being paid for with such increase shall
occur, except to the extent that, after giving effect thereto, the
Deferred Purchase Price Condition is satisfied. “ Deferred
Purchase Price Condition ” means, at any time, that
(a) the result of (i) the total Outstanding Balance of
Eligible Receivables sold by the Originator to the Assignee under
this UK Sale Agreement and which are then existing (the “
UK Outstanding Receivables Balance ”), less
(ii) the sum of (A) the result of (x) the total
Purchase Price of Receivables sold by the Originator to the
Assignee from and after the Closing Date, less (y) the
aggregate amount of such Purchase Price paid by the Assignee in
immediately available funds to the Originator from and after the
Closing Date, (B) the Portion of Investment represented by the
UK Outstanding Receivables Balance, and (C) any other amounts
owing by the Assignee under the Transaction Documents with respect
to the UK Outstanding Receivables Balance, exceeds (b) one
Pound Sterling (£1.00).
10
All amounts expressed to be payable
under this UK Sale Agreement by any party which (in whole or in
part) constitute the consideration for a supply for VAT purposes
shall be deemed to be exclusive of any VAT which is chargeable on
such supply and, accordingly, if VAT is chargeable on any supply
made by one party to another under this UK Sale Agreement, the
recipient of the supply shall pay to the supplier (in addition to
such amounts) an amount equal to the amount of the VAT which is
payable in respect of that supply against an appropriate VAT
invoice provided by the supplier to the recipient of the
supply.
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3.7.
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Settlement
as to Specific Receivables and Dilution .
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(a)
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If, on the day
of purchase of any Eligible Receivable from the Originator
hereunder, any of the representations or warranties set forth in
Article V, Clause 5.1 are not true with respect to such Eligible
Receivable or as a result of any action or inaction of the
Originator, on any subsequent day, any of such representations or
warranties set forth in Article V, Clause 5.1 is no longer true
with respect to such Eligible Receivable, then the Originator or
its duly authorised designee, shall, as soon as reasonably
practicable but within no later than two (2) Originator
Business Days deposit immediately available funds in the UK
Collection Account, in an amount equal to the Outstanding Balance
of such Eligible Receivable, for application by the Servicer to the
same extent as if Collections of such Eligible Receivable in such
amount had actually been received on such date.
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(b)
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If, on any day,
the Outstanding Balance of any Eligible Receivable purchased or
contributed hereunder is reduced or adjusted as a result of any
defective, damaged, rejected, returned goods or services, or any
discount, rebate, credit, counterclaim, billing error or other
adjustment made by the Originator or the Assignee or the Servicer
(other than as a result of repayment or as a result of the
inability of the Obligor to make payment (i.e., a credit loss or
the insolvency of the Obligor)) or any setoff or dispute between
the Originator, the Servicer and an Obligor, then the Purchase
Price with respect to such Eligible Receivable shall be reduced by
the amount of such net reduction and shall be accounted for by the
Originator as provided in clause (c) below.
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(c)
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Any reduction
in the Purchase Price of any Eligible Receivable pursuant to clause
(b) above shall be applied as a credit for the account of the
Assignee against the Purchase Price of Eligible Receivables
subsequently purchased by the Assignee from the Originator
hereunder; provided, however if there have been no purchases of
Eligible Receivables from the Originator (or insufficiently large
purchases of Eligible Receivables) to create a Purchase Price
sufficient to so apply such credit against, the amount of such
credit:
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(i)
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to the extent
of any outstanding principal balance under the UK Company Note
payable to the Originator, shall be deemed to be a payment under,
and shall be deducted from the principal amount outstanding under,
the UK Company Note payable to the Originator; or
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11
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(ii)
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after making
any deduction pursuant to sub-Clause (i) above, shall be paid
in immediately available funds to the Assignee by the Originator in
the manner and for application as described in the following
proviso;
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provided, further, that at any time
(y) when a Termination Event or Unmatured Termination Event
exists or (z) on or after the date on which the Receivables
Purchase Agreement has terminated, the amount of any such credit
shall be paid by the Originator or its duly authorised designee to
the Assignee by deposit in immediately available funds into the UK
Collection Account for application by the Servicer to the same
extent as if Collections of the applicable Eligible Receivable in
such amount had actually been received on such date.
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(a)
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Except to the
extent expressly set forth herein, the Originator shall not have
any right or obligation under this UK Sale Agreement, by
implication or otherwise, to repurchase from the Assignee any
acquired Eligible Receivables or any Receivables Property with
respect thereto or to rescind or otherwise retroactively affect any
purchase of any acquired Eligible Receivable or any Receivables
Property with respect thereto after any such Eligible Receivable is
assigned and transferred to the Assignee hereunder.
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(b)
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The Originator
shall, prior to the occurrence of a Termination Event, have the
right, but not the obligation, to request the Assignee to sell it
one or more Receivables purchased by the Assignee that (i) are
not in fact Eligible Receivables or (ii) have become Defaulted
Receivables by delivering, by no later than 11:30 a.m. (London
Time) on any Offer Date, a written request (a “ Repurchase
Request ”). Provided that, solely with respect to
Receivables which have become Defaulted Receivables, such
repurchase right shall be exercised by the Originator only for
Defaulted Receivables in respect of which VAT bad debt relief is,
in the reasonable view of the Originator, likely to be available to
it.
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(c)
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Following receipt by the Assignee
of a Repurchase Request from the Originator, the Originator or its
duly authorised designee shall pay on the next Settlement Date to
the UK Collection Account an amount equal to the Purchase Price
paid in respect of each Receivable (together with any Related
Security) described in such Repurchase Request, less any
Collections (which shall be retained by the Assignee) previously
received with respect to each such Receivable (the “
Repurchase Amount ”) and the Assignee shall take or
perform such necessary steps,
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procedures and formalities, and
deliver any necessary documents so as to validly effect the
repurchase of each such Receivable (together with any Related
Security). Any such action shall be at the expense of the
Originator and any transfer of the relevant repurchased Receivables
and Related Security shall be without representation by or recourse
to the Assignee. Transfer to the Originator of title and ownership
in and to those repurchased Receivables and Related Security shall
occur immediately upon payment of the Repurchase Amount on such
Settlement Date.
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(d)
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If the
Originator has repurchased a Defaulted Receivable pursuant to the
provisions of this Clause 3.8 and subsequently receives the whole
or any part of such Defaulted Receivable, the Originator shall
retain for its account the amount of such recovery.
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(e)
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Notwithstanding
any provision to the contrary in this UK Sale Agreement, if the
Repurchase Amount corresponding to the Receivables relating to any
Repurchase Request is not paid in full by the Originator on the
applicable Settlement Date, as determined in accordance with this
Clause 3.8, no repurchase of said Receivables shall take place on
such Settlement Date and any transfer document relating thereto
shall be deemed automatically null and void. In such circumstances,
the Originator shall indemnify the Assignee for costs of the
Assignee incurred directly or indirectly as a result of such
failure.
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(f)
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If any
repurchased Receivable or Receivables Property related thereto is
not transferred for any reason as provided under this Clause 3.8,
the Servicer, acting on behalf of the Assignee (acting on the
instructions of the Agent), shall be obliged to take all actions
necessary for the effective transfer of such repurchased Receivable
or Related Property (and shall in particular be obliged to endorse
any cheques relating to such repurchased Receivable or Related
Property), as the case may be, without undue delay and at the
expense of the Originator, and take all further action as may be
necessary or that the Originator may reasonably request in order to
perfect, protect or more fully evidence the repurchases
hereunder.
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Without limiting the generality of
the foregoing, the Servicer or the Assignee (or any of their duly
authorised designees), shall upon the request of the Originator
execute such further agreements, instruments, powers of attorney,
and make such filings, deliver such notices and take such other
actions, as may be necessary or appropriate, to give full effect to
the transactions contemplated in this Clause 3.8. Until any such
full transfer and re-assignment of the repurchased Receivables and
Related Property is fully effected and legally valid and binding,
the Assignee shall hold such repurchased Receivables and Related
Property on trust for the benefit of the Originator.
13
The Originator and the Assignee
hereby agree that, unless otherwise required by applicable law or
unless an Obligor designates that a payment be applied to a
specific Eligible Receivable, all Collections from an Obligor shall
be applied to the oldest Receivables of such Obligor.
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3.10.
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Certain
Rights of the Purchaser
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(a) At any time following the
occurrence and during the continuation of a Termination
Event:
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(i)
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at the
Assignee’s or the Agent’s request the Originator shall,
at its own expense (and, if the Originator shall fail to do so
within three (3) Originator Business Days, the Assignee or the
Agent may, at the Originator’s expense), if the Originator
has not already done so:
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(A)
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notify each
Obligor of Eligible Receivables sold by it hereunder of the
transfer, sale and assignment of the Eligible Receivables and the
Related Rights (to the extent sold hereunder) with respect thereto
pursuant to this UK Sale Agreement and the Transaction Documents
and of the Assignee’s beneficial ownership of such Eligible
Receivables and the Related Rights with respect thereto;
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(B)
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direct such
Obligors that payments under any such Eligible Receivable or any
Related Rights with respect thereto be made directly to the
Assignee or its designee; and
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(C)
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execute any
power of attorney or other similar instrument and/or take any other
action necessary or desirable to give effect to such notice and
directions, including any action required to be taken so that the
obligations or other indebtedness of such Obligors in respect of
any such Eligible Receivable and any Related Rights with respect
thereto in each case, sold by it hereunder may no longer be legally
satisfied by payment to the Originator or any of its Affiliates
(other than the Assignee).
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(ii)
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if such
Termination Event relates to the Originator, the Originator
authorises the Assignee and the Agent to endorse in the
Originator’s name and in favour of the Assignee cheques and
other instruments representing Collections relating
thereto.
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(b) Following the occurrence and
during the continuation of any Termination Event contemplated by
subsections (a), (b), (c), (m) and (q) of Exhibit V to
the Receivables Purchase Agreement, the Originator hereby
authorizes the Assignee and the Agent to take, to the extent
permitted under applicable law, any and all steps in its name and
on its behalf that are necessary or desirable, in the determination
of the Assignee or the Agent, to collect amounts due under the
acquired Eligible Receivables and any Related Rights with respect
thereto, in each case, sold by the Originator hereunder,
including,
14
without limitation, enforcing the
relevant Eligible Receivables and any Related Rights with respect
thereto, including to ask, demand, collect, sue for, recover,
compromise, receive and give acquittance and receipts for moneys
due and to become due under or in connection therewith and to file
any claims or take any action or institute any proceedings that the
Assignee or the Agent (or any designee) may deem to be necessary or
desirable for the collection thereof or to enforce compliance with
the terms and conditions of, or to perform any obligations or
enforce any rights of the Originator in respect of, the relevant
Eligible Receivables and any Related Rights with respect thereto
and the other Transaction Documents.
Article IV CONDITIONS OF
PURCHASE
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4.1.
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The obligation
of the Assignee to purchase Eligible Receivables and Related Rights
from the Originator on any Offer Date (including on the Closing
Date) shall be subject to the conditions precedent that:
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(i)
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in connection
with such sale and purchase, the Originator or its duly authorised
designee has delivered a Global Letter of Offer in the manner set
out in (and in accordance with) Article III, Clause 3.2 of this UK
Sale Agreement;
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(ii)
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on such date no
voluntary or involuntary bankruptcy, insolvency, reorganisation or
other similar case or proceeding is pending against the Originator
or the Assignee under any applicable insolvency law;
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(iii)
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the Facility
Termination Date has not occurred;
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(iv)
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no Termination
Event has occurred with respect to the Originator; and
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(v)
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the conditions
precedent contained in Exhibit II to the Receivables
Purchase Agreement have been satisfied.
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Article V REPRESENTATIONS AND
WARRANTIES, COVENANTS
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5.1.
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The Originator
hereby represents and warrants on the date of this UK Sale
Agreement to the Assignee as follows:
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(a)
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It is duly
incorporated and validly existing under the laws of England and
Wales and is duly qualified to do business, and is qualified in
every jurisdiction where the nature of its business requires it to
be so qualified, unless any failure to be so qualified would not
have a Material Adverse Effect.
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(b)
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The execution, delivery and
performance of this UK Sale Agreement and the other Transaction
Documents to which it is a party in its capacity as Originator,
(i) are within its corporate powers, (ii) have been duly
authorised by all necessary corporate action on its part,
(iii) do not contravene or result in a default under or
conflict with (1) its
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15
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organizational documents,
(2) any law, rule or regulation applicable to` it,
(3) any contractual restriction binding on or affecting it or
its property or (4) any order, writ, judgment, award,
injunction or decree binding on or affecting it or its property,
unless in each case such continuation, default or conflict could
not reasonably be expected to have a Material Adverse Effect,
(iv) with respect to it, do not result in or require the
creation of any Adverse Claim (other than Permitted Adverse Claims
and the retention by it of legal title (except in the case of a
Termination Event that has occurred and is continuing) to the
Eligible Receivables) upon or with respect to any of its properties
and (v) are in its commercial interest. This UK Sale Agreement
and the other Transaction Documents to which the Originator is a
party in its capacity as Originator have been duly executed and
delivered by it.
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(c)
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It has not
failed to obtain any licenses, permits, approvals, consents,
franchises or other governmental agency or body authorizations
having jurisdiction over it necessary to the ownership of its
properties or to the conduct of its business, which violation or
failure to obtain would be reasonably likely to have a Material
Adverse Effect.
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(d)
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No
authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority or other Person is required
for the due execution, delivery and performance by it of this UK
Sale Agreement or the other Transaction Documents to which it is a
party in its capacity as Originator, except (i) for actions
taken or referred to in Exhibit II of the Receivables
Purchase Agreement, all of which have been (on or before the
Closing Date) duly made or taken and are in full force and effect
and (ii) where the failure to have obtained any such
authorization or approval or taken any such action or made any such
filing or notice would not have nor would be reasonably likely to
have a Material Adverse Effect.
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(e)
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Both before and
after giving effect to any sale and purchase hereunder, it shall be
able to pay its debts and liabilities, direct, subordinated,
contingent or otherwise, as such debts and liabilities become
due.
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(f)
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The UK Sale
Agreement and each of the Transaction Documents to which it is a
party in its capacity as Originator constitutes a legal, valid and
binding obligation, enforceable against it in accordance with its
terms, subject to the Legal Reservations.
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(g)
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There is no
pending action, suit or proceeding and, to its knowledge, no
threatened action, suit or proceeding, affecting it or any of its
properties before any Governmental Authority or arbitrator which
could reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect.
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(h)
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It has complied
in all material respects with its Credit and Collection Policy with
regard to each Pool Receivable.
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16
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(i)
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It is not in
violation of any law, rule or regulation or of any order of any
court, arbitrator or Governmental Authority that could reasonably
be expected to have a Material Adverse Effect.
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(j)
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Each Receivable
originated by it included in the calculation of the Net Eligible
Sterling Pool Balance is an Eligible Receivable as of the date of
such calculation.
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(k)
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It is the
beneficial owner of the Receivables it is purporting to transfer
pursuant to this UK Sale Agreement and each Global Letter of Offer,
free and clear of any Adverse Claim (other than Permitted Adverse
Claims and the retention by it of legal title to the Eligible
Receivables (except in the case of a Termination Event that has
occurred and is continuing)); upon each purchase hereunder, the
Assignee shall acquire a valid and enforceable beneficial interest
in each such Eligible Receivable. No effective financing statement
or other instrument similar in effect covering any Eligible
Receivable or any Contract or other Related Security or Collections
with respect thereto or the UK Originator Account or UK Collection
Account is on file in any recording office, except those filed in
favour of the Assignee pursuant to this UK Sale Agreement or the
Purchaser pursuant to the Receivables Purchase Agreement and the
other Transaction Documents (and those relating to security
interests that will be terminated or released on or prior to the
Closing Date, other than Permitted Adverse Claims and any security
interests relating to legal title (except in the case of a
Termination Event that has occurred and is continuing) retained by
it in respect of the Eligible Receivables).
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(l)
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The name and
address of the UK Collection Bank, together with the account
numbers of the UK Originator Account and UK Collection Account at
such UK Collection Bank are specified in Schedule II to the
Receivables Purchase Agreement (except as otherwise consented by
the Agent in accordance with clause (i) of Exhibit IV
to the Receivables Purchase Agreement) and each of the UK
Originator Account and the UK Collection Account is subject to a UK
Collection Bank Agreement. All Obligors have been directed to make
all payments with respect to each Contract to the UK Collection
Account.
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(m)
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Its complete
corporate name is set forth in the preamble to this UK Sale
Agreement, and it does not use any other corporate name, trade
name, doing business name or fictitious name, and except for names
(i) set forth in Schedule III of the Receivables
Purchase Agreement and/or (ii) first used after the date of
the Receivables Purchase Agreement and set forth in a notice
delivered to the Agent pursuant to the Receivables Purchase
Agreement.
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(n)
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All written
information furnished by it to the Assignee and the Agent, in
connection with this UK Sale Agreement and any of the other
Transaction Documents shall be true and accurate in every material
respect.
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(o)
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It acknowledges
that the Purchaser and the Agent are entering into the Transaction
Documents to which they are parties in reliance upon the
Assignee’s identity as a legal entity separate from the
Originator.
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(p)
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It has filed or
caused to be filed all material returns, statements, forms and
reports for taxes, domestic or foreign, required to be filed by it
and has paid or made adequate provisions for the payment of all
taxes payable by it which have become due or any assessments made
against it or any of its Property and all other taxes, fees or
other charges imposed on it or any of its Property by any
Governmental Authority other than: (i) those the amount or
validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of the
Originator; and (ii) in the case of taxes other than income or
similar taxes (“designated taxes”), except to the
extent that the failure to do so or to pay such designated taxes
would not reasonably be expected to result in a Material Adverse
Effect.
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(q)
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The
transactions contemplated by this UK Sale Agreement and the other
Transaction Documents are in its best interest and comply with its
corporate purpose.
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(r)
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No portion of
the Purchase Price of any Eligible Receivables sold by it pursuant
to this UK Sale Agreement, and no other funds, if any, received by
it from the Assignee, the Purchaser or the Agent pursuant to any of
the Transaction Documents, will be used for any purpose other than
general corporate purposes.
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(s)
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The Purchase
Price paid for by the Assignee for each E
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