Exhibit 10.1
SECOND AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT
dated as of September 27, 2006
among
U. S. STEEL RECEIVABLES LLC,
as Seller
UNITED STATES STEEL CORPORATION,
as initial Servicer
THE PERSONS PARTY HERETO AS CP CONDUIT PURCHASERS,
COMMITTED PURCHASERS, FUNDING AGENTS AND LC BANKS
and
THE BANK OF NOVA SCOTIA,
as Collateral Agent
ARTICLE I. AMOUNTS AND
TERMS OF THE PURCHASES
2
Section 1.1.
Facility; Termination, Decrease and Increase.
2
Section 1.2.
Transfers; Security Interests; Repurchase of Defaulted
Receivables.
3
Section 1.3.
Purchased Interest Computation.
6
Section 1.4.
Non-Liquidation Settlement and Reinvestment Procedures.
6
Section 1.5.
Liquidation Settlement Procedures.
7
Section 1.6.
Deemed Collections; Reduction in Net Investment.
11
Section 1.7.
Fees
13
Section 1.8.
Payments and Computations, Etc.
13
Section 1.9.
Increased Costs.
13
Section 1.10.
Requirements of Law.
14
Section 1.11.
Inability to Determine Eurodollar Rate.
15
Section 1.12. Sharing
of Payments, etc.
16
Section 1.13.
Expiration or Extension of Commitments.
16
Section 1.14.
Purchaser Groups and Purchasers.
17
Section 1.15.
Obligations Several.
17
Section 1.16. Issuance
of Letters of Credit.
18
Section 1.17. Form of
Letters of Credit.
19
Section 1.18.
Requirements For Issuance of Letters of Credit.
19
Section 1.19.
Disbursements, Reimbursement.
19
Section 1.20.
Documentation.
20
Section 1.21.
Determination to Honor Drawing Request.
20
Section 1.22. Nature
of Reimbursement Obligations.
20
Section 1.23.
Liability for Acts and Omissions.
22
Section 1.24.
Termination of Letters of Credit
23
ARTICLE II. REPRESENTATIONS AND WARRANTIES; COVENANTS; TERMINATION
EVENTS
23
Section 2.1.
Representations and Warranties; Covenants.
23
Section 2.2.
Termination Events.
23
ARTICLE III.INDEMNIFICATION
23
Section 3.1.
Indemnities by the Seller.
24
Section 3.2.
Indemnities by the Servicer.
25
Section 3.3.
Defense of Claims.
26
ARTICLE IV. ADMINISTRATION AND COLLECTIONS
27
Section 4.1.
Appointment of the Servicer.
27
Section 4.2.
Duties of the Servicer.
28
Section 4.3.
Establishment and Use of Certain Accounts.
29
Section 4.4.
Enforcement Rights.
30
Section 4.5.
Responsibilities of the Seller.
31
Section 4.6.
Servicing Fee.
31
ARTICLE V. THE AGENTS
31
Section 5.1.
Appointment and Authorization.
32
Section 5.2.
Delegation of Duties.
33
Section 5.3.
Exculpatory Provisions.
33
Section 5.4.
Reliance by Agents.
33
Section 5.5.
Notice of Termination Events.
34
Section 5.6.
Non-Reliance on Collateral Agent, Funding Agents and
Other Purchasers.
34
Section 5.7.
Collateral Agent, Funding Agents and Purchasers.
35
Section 5.8.
Indemnification.
35
Section 5.9.
Successor Collateral Agent.
36
ARTICLE VI. MISCELLANEOUS
36
Section 6.1.
Amendments, Etc.
36
Section 6.2.
Notices, Etc.
37
Section 6.3.
Assignability.
37
Section 6.4.
Costs, Expenses and Taxes.
40
Section 6.5. No
Proceedings; Limitation on Payments.
40
Section 6.6.
GOVERNING LAW AND JURISDICTION.
41
Section 6.7.
Execution in Counterparts.
41
Section 6.8.
Survival of Termination.
41
Section 6.9.
WAIVER OF JURY TRIAL.
41
Section 6.10. Entire
Agreement.
42
Section 6.11.
Headings.
42
Section 6.12.
Purchaser's Liabilities.
42
Section 6.13.
Confidentiality.
42
Section 6.14. Agent
Conflict Waiver.
43
Section 6.15.
Interpretation
43
EXHIBIT I
Definitions
EXHIBIT II Conditions of
Purchases
EXHIBIT III Representations and
Warranties
EXHIBIT IV Covenants
EXHIBIT V
Termination Events
EXHIBIT VI Form of
Assumption Agreement
EXHIBIT VII Form of Transfer
Supplement
SCHEDULE I Credit and
Collection Policy
SCHEDULE II Lock-Box Banks and
Lock-Box Accounts
SCHEDULE III
Trade Names
SCHEDULE IV Special Obligors
ANNEX A
Form of Purchase Notice
ANNEX B
Form of Monthly Report
ANNEX C
Form of Increase Notice
ANNEX D
Form of Request to Add Classified Obligor
ANNEX E
Form of Acceptance of Additional Classified Obligor
This
SECOND AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT (as
amended, supplemented or otherwise modified from time to time, this
"Agreement")
is dated as of September 27, 2006, among U. S. STEEL RECEIVABLES
LLC, a Delaware
limited liability company, as Seller (the "Seller"), UNITED STATES
STEEL
CORPORATION ("USS"), a Delaware corporation as initial Servicer (in
such
capacity, together with its successors and permitted assigns in
such capacity,
the "Servicer"), the several commercial paper conduits identified
on the
signature pages hereto and their respective successors and
permitted assigns
(the "CP Conduit Purchasers"; each, individually, a "CP Conduit
Purchaser"), the
several financial institutions identified on the signature pages
hereto as
"Committed Purchasers" and their respective successors and
permitted assigns
(the "Committed Purchasers"; each, individually, a "Committed
Purchaser"), the
several financial institutions identified on the signature pages
hereto as "LC
Banks" and their respective successors and permitted assigns (the
"LC Banks",
each individually, an "LC Bank"), the agent banks identified for
each CP Conduit
Purchaser, Committed Purchaser and LC Bank on the signature pages
hereto and
their respective successors and permitted assigns (the "Funding
Agents"), each
CP Conduit Purchaser, Committed Purchaser, LC Bank and Funding
Agent that
becomes a party hereto from time to time pursuant to an Assumption
Agreement,
Transfer Supplement or otherwise, and THE BANK OF NOVA SCOTIA, a
Canadian
chartered bank acting through its New York Agency ("BNS"), as
Collateral Agent
for the CP Conduit Purchasers, Committed Purchasers and LC Banks
(in such
capacity, together with its successors and permitted assigns in
such capacity,
the "Collateral Agent").
The
Seller may desire to convey, transfer and assign, from time to
time,
undivided percentage interests in certain accounts receivable, and
(i) the CP
Conduit Purchasers may desire to, and the Committed Purchasers, if
requested by
the related CP Conduit Purchasers, if any, or if the CP Conduit
Purchasers are
unable to do so, shall, accept such conveyance, transfer and
assignment of such
undivided percentage interests, and (ii) the applicable LC Bank
shall, upon the
request of the Seller, issue Letters of Credit, in each case
subject to the
terms and conditions of this Agreement.
This
Agreement amends and restates in its entirety, as of the Closing
Date,
the Amended and Restated Receivables Purchase Agreement dated as of
November 28,
2001 (as amended, supplemented or otherwise modified through the
date hereof,
the "Original Agreement"), among the Seller and initial Servicer,
the CP Conduit
Purchasers, the Committed Purchasers and the Funding Agents from
time to time
party thereto, and the Collateral Agent. Upon the effectiveness of
this
Agreement, the terms and provisions of the Original Agreement
shall, subject to
this paragraph, be superseded hereby in their entirety and Market
Street Funding
LLC shall become a party hereto as a "CP Conduit Purchaser", PNC
Bank, National
Association shall become a party hereto as a "Committed Purchaser"
and as a
"Funding Agent" and each of the LC Banks shall become parties
hereto.
Notwithstanding the amendment and restatement of the Original
Agreement by this
Agreement, the Seller and USS shall continue to be liable to each
Indemnified
Party or Affected Person (as such terms are defined in the Original
Agreement)
with respect to all unpaid Capital, Discount (as such terms are
defined in the
Original Agreement), fees and expenses (the "Original Agreement
Outstanding
Amounts") under the Original Agreement (which shall continue to
accrue
thereunder until such amounts are paid in full) and all agreements
to indemnify
such parties in connection with events or conditions arising or
existing prior
to the effective date of this Agreement . Upon the effectiveness of
this
Agreement, each reference to the Original Agreement in any other
document,
instrument or agreement shall mean and be a reference to this
Agreement.
Nothing contained herein, unless expressly herein stated to the
contrary, is
intended to amend, modify or otherwise affect any other instrument,
document or
agreement executed and or delivered in connection with the Original
Agreement.
In
consideration of the mutual agreements, provisions and
covenants
contained herein, the parties hereto agree as follows:
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 1.1.
Facility; Termination, Decrease and Increase. (a) On the
terms and conditions hereinafter set forth in this Agreement, the
parties
hereto establish a receivables financing facility.
(b)
The Seller may, upon
at least 30 days' written notice to each Funding
Agent, terminate or reduce the unused portion of the aggregate
Commitments of
all Purchaser Groups (ratably according to each Purchaser Group's
Commitment);
provided, that each reduction shall be in the amount of at least
$10,000,000
with respect to each Purchaser Group, or an integral multiple of
$1,000,000 in
excess thereof, and that, unless terminated, the total amount of
all Commitments
of all Purchaser Groups shall in no event be reduced below
$200,000,000, unless
the Facility Limit is being reduced to zero and the aggregate LC
Stated Amount
for each LC Bank is being cash collateralized in full by deposit of
such amounts
into the applicable LC Collateral Accounts; provided, further that
the
Commitment of any Purchaser Group shall not be less than the
aggregate LC Stated
Amount for the related LC Bank, unless such amount is being cash
collateralized
in full by deposit of such amounts into the applicable LC
Collateral Account.
(c)
The Seller may, upon
at least 30 days' written notice in substantially
the form of Annex C hereto to each Funding Agent request that the
related
Purchaser Group increase their existing Commitment; provided that:
(i) the
Facility Limit after giving effect to such increases shall not
exceed
$800,000,000 without the unanimous written consent of all the
Funding Agents,
(ii) the Seller's request for the increases in the respective
Commitments of the
Purchaser Groups shall be ratable with respect to each such
Purchaser Group
(according to the then existing Commitments of all such Purchaser
Groups), and
if Purchaser Groups holding less than 100% of the aggregate
Commitments of all
Purchaser Groups consent to such increase (any such non consenting
Purchaser
Group, a "Non-Increasing Purchaser Group") in their respective
Commitment, the
Seller may request (by written notice to the Funding Agents)
increases in the
Commitments of the Purchaser Groups who have consented (any such
Purchaser
Group, an "Increasing Purchaser Group"), on a ratable basis (based
on the then
existing Commitments of all such Increasing Purchaser Groups),
unless otherwise
consented to in writing by the Funding Agents for such Increasing
Purchaser
Groups, (iii) each Funding Agent (and the related Purchasers)
shall, in its sole
discretion, make a determination whether or not to so grant such
request and
(iv) the Seller shall (and shall cause the Servicer to) deliver all
documents,
instruments, reports, opinions and agreements as any Funding Agent
may
reasonably request in connection with making a determination as to
whether or
not to grant such request.
(d)
The Seller may, if,
following the Seller's request for an increase
pursuant to clause (c) above, the aggregate amount of Commitment
increases from
all the Increasing Purchaser Groups does not equal the amount
requested by the
Seller, at its own expense, add one or more additional Purchaser
Groups as
parties hereto pursuant to, and in accordance with the terms of,
Section 1.14;
provided, that the aggregate amount of all the Commitments of all
Purchaser
Groups after giving effect to such joinder does not cause the
Facility Limit to
exceed $800,000,000 without the unanimous written consent of all
the Funding
Agents.
Section 1.2.
Transfers;
Security Interests; Repurchase of Defaulted
Receivables. (a) Prior to the Facility Termination Date, upon the
terms and
subject to the conditions set forth herein and in the other
Transaction
Documents, the Seller may, at its option from time to time, convey,
transfer and
assign to the Collateral Agent for the benefit of each applicable
Purchaser
(which, for the avoidance of doubt, shall not be a CP Conduit
Purchaser during
the pendency of a CP Conduit Purchaser Termination Event), and the
Collateral
Agent for the benefit of the applicable Purchasers shall, accept
such
conveyance, transfer and assignment from the Seller (without
recourse except as
provided herein), of undivided percentage ownership interests in
the Pool
Receivables, together with the Related Security, Collections and
proceeds with
respect thereto (each, an "Incremental Transfer") for an amount
equal to the
applicable Transfer Price from time to time prior to the Facility
Termination
Date; provided that after giving effect to the issuance of Notes
by the CP
Conduit Purchasers or the obtaining of funds by the Committed
Purchasers or the
issuance of Letters of Credit by the applicable LC Banks, as the
case may be, to
fund the Transfer Price of any Incremental Transfer and the payment
(or issuance
of the applicable Letters of Credit, as the case may be) to the
Seller of such
Transfer Price, (i) the Net Exposure of any such Purchaser Group
shall not
exceed the Commitment of the related Purchaser Group, (ii) the
Capital plus the
LC Aggregate Stated Amount shall not exceed the Facility Limit and
(iii) in the
case of requests for a Letter of Credit, the aggregate LC Stated
Amount for any
LC Bank shall not exceed such LC Bank's LC Sub-Commitment; and
provided further,
that the conditions set forth in Exhibit II of this Agreement shall
be satisfied
with respect thereto.
The
Seller may, from time to time, by notice to the applicable
Funding
Agents given by telecopy, offer to convey, transfer and assign to
the Collateral
Agent for the benefit of each applicable Purchaser (which, for the
avoidance of
doubt, shall not be a CP Conduit Purchaser during the pendency of a
CP Conduit
Purchaser Termination Event), undivided percentage ownership
interests in the
Purchased Interest at least two (2) Business Days prior to the
proposed date of
any Incremental Transfer. Each such notice (each a "Purchase
Notice") shall
specify (x) the desired Transfer Price (which shall be at least (i)
$1,000,000
per CP Conduit Purchaser or Committed Purchaser or integral
multiples of
$100,000 in excess thereof or (ii) $25,000 per Letter of Credit)
or, in each
case such lesser amount as shall equal the remaining commitment of
the
applicable Purchaser Group, (y) the desired date of such
Incremental Transfer
which shall be a Business Day and (z) whether or not all or any
portion of such
desired Transfer Price is requested in the form of the issuance by
any
applicable LC Bank of one or more Letters of Credit pursuant to the
terms of
Sections 1.16 and 1.17. In the case of any request for a
purchase (or portion
thereof) in cash (rather than through the issuance of one or more
Letters of
Credit), at the option of each such CP Conduit Purchaser, the
Funding Agent for
the benefit of such CP Conduit Purchaser shall accept or reject any
such offer
by prompt notice given to the Seller.
Each
Purchase Notice in respect of a proposed Incremental Transfer shall
be
irrevocable and binding on the Seller, and the Seller shall
indemnify the
Purchasers against any loss or expense incurred by the Purchasers,
either
directly or indirectly, as a result of any failure by the Seller to
complete
such Incremental Transfer, including, without limitation, any loss
or expense
incurred by Purchasers by reason of the liquidation or reemployment
of funds
acquired by the Purchasers (including, without limitation, funds
obtained by
issuing Notes, obtaining deposits as loans from third parties,
reemployment of
funds and/or issuing or arranging for the issuance of Letters of
Credit) to fund
such Incremental Transfer.
The
Seller may, subject to the limitations on funding set forth in
this
paragraph (a) and the other requirements and conditions herein, use
the proceeds
of any purchase or reinvestment by a CP Conduit Purchaser or a
Committed
Purchaser hereunder to satisfy its Reimbursement Obligation to the
related LC
Bank pursuant to Section 1.19.
In
addition, if the Seller fails to reimburse the applicable LC Bank
for
the full amount of any drawing under any Letter of Credit when due
(out of its
own funds available therefor, or otherwise, at such time), pursuant
to Section
1.19, then the Seller shall, automatically (and without the
requirement of any
further action on the part of any Person hereunder), be deemed to
have requested
a new purchase from the CP Conduit Purchaser or Committed
Purchaser, as the case
may be, in such LC Bank's Purchaser Group on such date, pursuant to
the terms
hereof, in an amount equal to the amount of such Reimbursement
Obligation at
such time. Subject to
the limitations on funding set forth in this paragraph
(a) (and the other requirements and conditions herein), the CP
Conduit Purchaser
or Committed Purchaser in the LC Bank's Purchaser Group shall fund
such deemed
purchase request and deliver the proceeds thereof directly to the
related
Funding Agent to be immediately distributed to the LC Bank in
satisfaction of
the Seller's Reimbursement Obligation pursuant to Section 1.19, to
the extent
such amounts can be funded by such Purchaser, at such time,
hereunder.
(b)
On the date of each
Funded Purchase (but not reinvestment or issuance
of a Letter of Credit) of undivided percentage ownership interests
with regard
to the Purchased Interest hereunder, each CP Conduit Purchaser or
Committed
Purchaser making such a purchase (through the Collateral Agent) on
such date
pursuant to subsection (a) of this Section 1.2 (or its Funding
Agent on such
Purchaser's behalf) shall, upon satisfaction of the applicable
conditions set
forth in Exhibit II, make available to the Seller in same day
funds, at Mellon
Bank, N.A., account number 000-0300, ABA 043000261, an amount equal
to such
Purchaser's Purchaser Group Funded Share of the Transfer Price with
respect to
thereto (as specified by the Seller pursuant to subsection (a) of
this Section
1.2) relating to the undivided percentage ownership interest then
being
purchased by such Purchaser for cash.
(c)
Effective on the date
of each Funded Purchase pursuant to this
Section 1.2, each reinvestment pursuant to Section 1.4 or 1.5 and
each issuance
of a Letter of Credit, as applicable, the Seller hereby sells and
assigns to
the Collateral Agent for the benefit of the Purchasers (according
to the Net
Exposure of each Purchaser Group) an undivided percentage ownership
interest
in: (i) each Pool Receivable then existing, (ii) all Related
Security with
respect to such Pool Receivables, and (iii) all Collections with
respect to,
and other proceeds of, such Pool Receivables and Related
Security.
(d)
(i) It is the express intent of the
parties hereto that the transfers
of the Pool Receivables, Related Security, Collections and other
proceeds of
such Receivables by the Seller to the Collateral Agent, as
contemplated by this
Agreement be, and be treated as, sales and not as secured loans.
If, however,
notwithstanding the intent of the parties, such transactions are
deemed to be
loans, the Seller hereby grants to the Collateral Agent for the
benefit of the
Purchasers (ratably, according to the Net Exposure of each
Purchaser Group) a
security interest (and hereby authorizes the filing of all
applicable UCC
financing statements to perfect such security interest) in all of
the Seller's
right, title and interest in and to the Pool Receivables, Related
Security and
Collections now existing and hereafter created, all monies due or
to become due
and all amounts received with respect thereto, and all proceeds
thereof, to
secure the obligations of the Seller hereunder, and this Agreement
shall be
deemed a security agreement under applicable law. If the Collateral Agent files
any UCC financing statement in connection with this facility, it
shall provide
the Servicer with a copy thereof promptly upon the Collateral
Agent's receipt of
an acknowledgment copy from the applicable UCC filing office.
(ii) In addition to and without limiting the grant of security
interest described in clause (i) of this Section 1.2(d), to secure
all of the
Seller's obligations (monetary or otherwise) under this Agreement
and the other
Transaction Documents to which it is a party, whether now or
hereafter existing
or arising, due or to become due, direct or indirect, absolute or
contingent,
the Seller hereby grants to the Collateral Agent for the benefit of
the
Purchasers (according to the Net Exposure of each Purchaser Group)
a security
interest in all of the Seller's right, title and interest, if any,
(including
any undivided interest of the Seller) in, to and under all of the
following,
whether now or hereafter owned, existing or arising: (i) all Pool
Receivables,
(ii) all Related Security with respect to such Pool Receivables,
(iii) all
Collections with respect to such Pool Receivables, (iv) the
Lock-Box Accounts,
the Concentration Account and the Collection Account, and all
amounts on deposit
therein, and all certificates and instruments, if any, from time to
time
evidencing such Lock-Box Accounts, the Concentration Account and
the Collection
Account, and amounts on deposit therein, (v) all of the Seller's
right, title
and interest in and to the Purchase and Sale Agreement and each
other
Transaction Document to which it is a party, and (vi) all proceeds
of, and all
amounts received or receivable under any or all of, the foregoing
(collectively,
the "Pool Assets").
The Collateral Agent (for the benefit of the Purchasers)
shall have, with respect to the Pool Assets, and in addition to all
the other
rights and remedies available to the Collateral Agent (for the
benefit of the
Purchasers), all the rights and remedies of a secured party under
any applicable
UCC.
(e)
Whenever the LC Bank
issues a Letter of Credit pursuant to the terms
hereof, it shall, automatically and without further action of any
kind upon the
effective date of issuance of such Letter of Credit, have
irrevocably been
deemed to make a Funded Purchase hereunder if such Letter of Credit
is
subsequently drawn and such drawn amount shall not have been
reimbursed pursuant
to Section 1.19 upon such draw. All such Funded Purchases shall
comprise Base
Rate Portions of Capital in an amount equal to the amount of such
draw, and
shall accrue Discount from the date of such draw. If any Letter of Credit
expires or is surrendered without being drawn (in whole or in part)
then, in
such event, the foregoing commitment to make such Funded Purchases
shall expire
with respect to such Letter of Credit and the related LC Stated
Amount shall
automatically reduce by the amount of the Letter of Credit which is
no longer
outstanding.
(f)
At any time and from
time to time upon at least three Business Days
written notice to the Collateral Agent, the Seller may purchase any
Triggered
Receivables and the Related Security, Collections and proceeds with
respect
thereto, provided that in consideration therefor, the Seller shall
cause an
amount equal to the unpaid portion of such Receivables to be
remitted directly
to the Concentration Account. Upon closing any transaction
referenced in the
preceding sentence, the Collateral Agent shall, if requested, upon
receipt of
evidence satisfactory to it that an amount equal to the unpaid
portion of such
Receivable has been deposited into the Concentration Account to be
remitted
directly to the Concentration Account execute and deliver, at the
Seller's
expense, to the Seller such documents and instruments as are
reasonably
requested and authorize the filing of such UCC-3 termination
statements as are
appropriate, to terminate its interests (for itself and on behalf
of the
Purchasers) with respect to the affected Receivables and any
Related Security,
Collections and proceeds with respect thereto.
Section 1.3.
Purchased Interest Computation. The Purchased Interest
shall be initially computed on the date hereof. Thereafter, until
the Facility
Termination Date, the Purchased Interest shall be automatically
recomputed (or
deemed to be recomputed) on each Business Day other than a
Termination Day.
From and after the occurrence of any Termination Day, the Purchased
Interest
shall (until the event(s) giving rise to such Termination Day are
satisfied or
are waived by the Funding Agents) be deemed to be 100%.
The Purchased
Interest
shall become zero when the aggregate of the Capital thereof, and
all accrued and
unpaid Discount thereon with respect to each Purchaser shall have
been paid in
full, the aggregate LC Stated Amount for each LC Bank shall have
been cash
collateralized in full by deposit thereof into the applicable LC
Collateral
Accounts and all other amounts owed by the Seller and the Servicer
hereunder to
the Purchasers, the Funding Agents, and the Collateral Agent and
any other
Indemnified Party or Affected Person are paid in full, and the
Servicer shall
have received the accrued Servicing Fee thereon; provided that
nothing in this
Section 1.3 shall be construed to require the Seller, the Servicer
or any
Affiliate thereof to make actual computations on a daily basis or
to deliver to
the Purchasers, the Funding Agents, or the Collateral Agent a
writing setting
forth any computation, recomputation or deemed recomputation
effected under this
Section 1.3, except to the extent required pursuant to Section 2 of
Exhibit II
or as otherwise required pursuant to this Agreement.
Section 1.4.
Non-Liquidation Settlement and Reinvestment Procedures.
On
each day after the date of any Incremental Transfer but prior to
the Facility
Termination Date, and provided that Section 1.5 shall not be
applicable, the
Servicer shall, out of the Collections represented by the Purchased
Interest
received on or prior to such day and not previously set aside or
paid:
(i) set aside and hold
in trust in the Concentration Account for the
Purchasers, as applicable (or deposit into the Collection Account
if so required
pursuant to Section 1.5 hereof) an amount equal to all Discount,
Fees and, if
USS or any Affiliate thereof is not the Servicer, the Purchasers'
share of the
Servicing Fee (such share based on the Purchased Interest at such
time), in each
case accrued through such day and not so previously set aside or
paid;
(ii) subject to Section 1.6(b), reinvest the balance of such
Collections in respect of the Purchased Interest remaining after
application of
Collections as provided in clause (i) of this Section 1.4 for the
ratable
benefit of the Purchasers, as applicable, in additional undivided
percentage
ownership interests in the Pool Receivables, Related Security and
Collections
and other proceeds with respect thereto;
(iii) if USS or any Affiliate thereof is the Servicer, pay to
the
Servicer out of the amount of such Collections remaining after
application
pursuant to clause (i) and (ii), of this Section 1.4, an amount
equal to the
Purchasers' share of the Servicing Fee (such share based on the
Purchased
Interest at such time), accrued through such day and not previously
set aside
or paid; and
(iv) remit the balance, if any, of such Collections remaining
after
the applications provided in clauses (i), (ii) and (iii), of this
Section 1.4,
and Section 1.6(b), to the Seller for its own account. Such Collections
remitted to the Seller shall be available for the ordinary business
purposes of
the Seller or otherwise, subject to the provisions of the
Transaction Documents.
On each Settlement Date, from the amounts set aside as described in
clause (i)
of the first sentence of this Section 1.4 and Section 1.6(b), the
Servicer shall
pay to each Funding Agent, for the benefit of the Purchasers
related to such
Funding Agent (ratably according to accrued Discount and Fees), an
amount equal
to the accrued and unpaid Discount and Fees (as calculated by such
Funding
Agent) for the immediately preceding Settlement Period.
Each Funding Agent
shall distribute such amounts received from the Servicer in
accordance with the
preceding sentence to the related Purchasers entitled thereto;
provided that if
any Funding Agent has not received amounts sufficient on any such
Settlement
Date to pay all of the aforesaid amounts in full, such Funding
Agent shall pay
such amounts to the Purchasers, ratably among all such Purchasers
in the related
Purchaser Group entitled to payment thereof (based on the amount
owing to such
Purchasers in such categories at such time).
Section 1.5.
Liquidation Settlement Procedures. (a) If at any time on or
prior to any Termination Day, the Purchased Interest is determined
to be (or the
Servicer or the Seller is otherwise notified that the Purchased
Interest is)
greater than 100%, then the Seller shall immediately pay to each
Funding Agent,
for the benefit of the Purchasers related to such Funding Agent
(according to
the Net Exposure of each Purchaser Group) an amount that, when
applied to reduce
the Capital, will cause the Purchased Interest to be less than or
equal to 100%;
it being understood that if any such amounts are not immediately
paid by the
Seller, the Servicer shall cease making any reinvestments pursuant
to Section
1.4 and shall instead apply such amounts as would otherwise be
available to make
such reinvestments to so reduce the Purchased Interest by
depositing the same
into the Collection Account for distribution to the applicable
Purchasers on the
next Settlement Date in accordance with the provisions set forth in
the last
paragraph of Section 1.4 or paragraph (d) of this Section 1.5, as
applicable.
(b)
On and after any
Termination Day or the day on which an Unmatured
Termination Event occurs, the Servicer shall deposit or cause to be
deposited to
the Collection Account, for the benefit of the Purchasers (and
shall pay such
amounts to each applicable Funding Agent on the next Settlement
Date pursuant to
paragraph (d) below), all amounts previously set aside in the
Concentration
Account pursuant to Section 1.4 and not previously applied in
accordance with
the terms hereof.
(c)
If a Purchaser Group
elects not to extend its Commitment pursuant to
Section 1.13(a) and such Non-Extending Committed Purchaser is not
required to
transfer and assign its Commitment pursuant to Section 1.13(b)(ii)
of this
Agreement, the Servicer shall implement the procedures set forth in
this clause
(c) (a "Partial Liquidation") beginning on a Business Day that is
(x) no more
than 60 days prior to such Non-Extending Committed Purchaser's
Commitment Expiry
Date then in effect and (y) no later than such Non-Extending
Committed
Purchaser's Commitment Expiry Date then in effect. On each Business Day
thereafter and prior to the Net Investment of each such Purchaser
in such Non-
Extending Committed Purchaser's Group being reduced to zero and
cash
collateralizing in full such Purchaser Group's LC Bank's LC
Collateral Account
in an amount equal to such LC Bank's aggregate LC Stated Amount
(provided that
no Termination Event and no Unmatured Termination Event has
occurred and is
continuing), the Servicer shall apply funds, out of the Collections
represented
by the Purchased Interest received and not previously applied, in
the following
manner:
(i) set aside and hold in trust in the Concentration Account
(or
deposit into the Collection Account if so required by paragraph (b)
of this
Section 1.5), for the benefit of the Purchasers an amount equal to
all Discount
on all Fees, and, if USS or any Affiliate is not the Servicer, the
Purchasers'
share of the Servicing Fee (ratably, based on the Purchased
Interest at such
time), in each case accrued through such day and not so previously
set aside or
paid. The Servicer
shall thereafter pay to each applicable Funding Agent on the
next Settlement Date for the Purchasers (ratably according to
accrued Discount
and Fees) the amount of such accrued and unpaid Fees and Discount,
and shall pay
such portion of the Servicing Fee to the Servicer pursuant to
Section 1.4(iii);
(ii) pay to each applicable Funding Agent for the account of each
Non-
Extending Committed Purchaser, if any, related to such Funding
Agent (based on
the Net Exposure of such Purchaser Group at such time), and, for
the account of
any related CP Conduit Purchasers, if any, solely to the extent
necessary to
reduce the Net Exposure with respect to any such CP Conduit
Purchaser to an
amount that is equal to or lesser than the amount of any available
Commitment of
its Purchaser Group at such time, from such Collections remaining
after
application pursuant to clause (i) of this Section 1.5, the amount
of such Non-
Extending Committed Purchaser's Net Exposure; provided that solely
for purposes
of determining such Non-Extending Committed Purchaser's ratable
share of such
Collections, the Net Exposure of each such Purchaser in such
Non-Extending
Committed Purchaser shall be deemed to remain constant from the
date such
Purchaser Group becomes a Non-Extending Committed Purchaser until
the date the
Net Exposure of each such Purchaser in such Non-Extending Committed
Purchaser
has been paid in full (or in the case of an LC Bank, its LC
Collateral Account
has been cash collateralized in full in an amount equal to such LC
Bank's
aggregate LC Stated Amount); it being understood that if such day
is also a
Termination Day or a day on which an Unmatured Termination Event
has occurred
and is continuing, such Net Exposure shall be recalculated at such
time (taking
into account amounts received by or on behalf of such Purchaser
Group in respect
of its Net Exposure pursuant to this clause (ii)), and thereafter
Collections
shall be set aside in the Collection Account for payment to all
Purchasers
(according to each such Purchaser Group's Net Exposure) pursuant to
paragraph
(d) below;
(iii) reinvest the balance, if any, of such Collections in respect
of
Capital to the acquisition of additional undivided percentage
interests pursuant
to Section 1.4(ii) hereof; and
(iv) if USS or any Affiliate thereof is the Servicer, pay to
the
Servicer out of such Collections remaining after application
pursuant to clause
(i) through (iii) of this Section 1.5(c), an amount equal to the
Purchasers'
share of the Servicing Fee (based on the Purchased Interest at such
time).
(d)
On and after any
Termination Day and on each day thereafter, and on
each day on which an Unmatured Termination Event has occurred and
is continuing,
the Servicer shall deposit or cause to be deposited into the
Collection Account,
for the benefit of the Purchasers, all Collections received on such
day in
respect of the Purchased Interest, to be applied by the Collateral
Agent on the
next succeeding Settlement Date in the following order (i) to the
payment in
full of the accrued Discount, (ii) pari passu, to the payment in
full of the
outstanding Net Investment of each Purchaser in each Purchaser
Group and to cash
collateralize in full the LC Collateral Account for each related LC
Bank in an
amount equal to the aggregate LC Stated Amount for such LC Bank,
and (iii) to
the payment in full of all other amounts payable to the Purchasers
and their
assigns in respect of indemnities, fees, costs and expenses
hereunder and not
covered in clauses (i) and (ii) of this paragraph (d). On each such day, the
Servicer shall deposit to its account, from the amounts set aside
for the
Purchasers pursuant to the preceding sentence which remain after
payment in full
of the aforementioned amounts, the accrued Servicing Fee.
If there shall be
insufficient funds on deposit in the Collection Account following
deposits
therein by the Servicer pursuant to this paragraph and paragraph
(b) of this
Section 1.5, for the Collateral Agent to distribute funds in
payment in full of
the aforementioned amounts, the Collateral Agent shall distribute
such funds as
are in the Collection Account on the next succeeding Settlement
Date (and on
each Settlement Date thereafter, if applicable) in the following
order of
priority:
(i) first, to the
applicable Funding Agents, ratably (according to
the amounts thereof then payable to all Purchasers at such time),
for the
benefit of the Purchasers in such Funding Agent's Purchaser Group,
the payment
of the accrued Discount and all Fees;
(ii) second, to the Servicer, in payment of the accrued and
unpaid
Servicing Fee, if USS or any Affiliate of USS is not then the
Servicer (and
if such amount has not already been paid by operation of the
immediately
preceding sentence);
(iii) third, to the applicable Funding Agents, ratably (according
to
the amounts thereof then payable to all Purchasers at such time),
for the
benefit of the Purchasers in such Funding Agent's Purchaser Group,
for
reduction to zero of the Net Exposure of the related Purchaser
Group (including,
by cash collateralizing in full the LC Collateral Account for each
related LC
Bank in an amount equal to the aggregate LC Stated Amount for such
LC Bank);
(iv) fourth, to the applicable Funding Agents, ratably (according to
the amounts thereof then payable to all Purchasers at such time),
for the
benefit of the Purchasers in such Funding Agent's Purchaser Group,
in payment
of all other amounts payable to such Purchasers and their assigns
in respect of
indemnities, fees, costs and expenses hereunder and not covered in
clauses (i)
through (iii) of this Section 1.5(d); and
(v) fifth, to its account as Servicer, in payment of the accrued
and
unpaid Servicing Fee, if USS or any Affiliate of USS is the
Servicer (and if
such amount has not already been paid by operation of the
immediately preceding
sentence).
Each Funding Agent shall distribute such amounts received from the
Collateral
Agent in accordance with the preceding sentence to the related
Purchasers
entitled thereto; provided that if any Funding Agent has not
received amounts
sufficient on any such Settlement Date to pay all of the foregoing
amounts in
full, such Funding Agent shall pay such amounts to the Purchasers
ratably among
all such Purchasers in the related Purchaser Group entitled to
payment thereof
(based on the amount owing to such Purchasers in such categories at
such time).
(e)
Following the date on
which the Net Investment of each Purchaser Group
has been reduced to zero, the aggregate LC Stated Amount for each
LC Bank has
been cash collateralized in full by deposit thereof into the
applicable LC
Collateral Account, and all accrued Discount, Fees, Servicing Fees
and all other
amounts payable to the Purchasers, the Funding Agents, the
Collateral Agent,
each Indemnified Party and Affected Person and their assigns
hereunder have been
paid in full, (i) the Purchased Interest shall become zero, (ii)
the Collateral
Agent, on behalf of the Purchasers, shall be considered to have
reconveyed to
the Seller all of the Purchasers' right, title and interest in, to
and under the
Receivables, Related Security, Collections and proceeds with
respect thereto,
and (iii) the Collateral Agent, on behalf of the Purchasers, shall
execute and
deliver to the Seller, at the Seller's expense, such documents or
instruments as
are necessary, and authorize the filing of such UCC termination
statements as
are appropriate to terminate the Purchasers' respective interests
in the
Receivables, Related Security, Collections and proceeds with
respect thereto.
Any such documents shall be prepared by or on behalf of the Seller.
Thereafter
any remaining Collections shall be for the account of the
Seller.
Section 1.6.
Deemed Collections; Reduction in Net Investment.
(a)
For the purposes of
this Agreement:
(i) if on any day the
Outstanding Balance of any Pool Receivable is
reduced or adjusted as a result of any defective, rejected,
returned,
repossessed or foreclosed goods or services, or any revision,
cancellation,
allowance, discount or other adjustment made by the Seller or any
Affiliate of
the Seller, or any setoff or dispute between the Seller or any
Affiliate of the
Seller and an Obligor, the Seller shall be deemed to have received
on such day
a Collection of such Pool Receivable in the amount of such
reduction or
adjustment; and
(ii) if on any day any of the representations or warranties in
Section
1(f), (k) or (q) of Exhibit III is not true with respect to any
Pool Receivable,
the Seller shall be deemed to have received on such day a
Collection of such
Pool Receivable in full (Collections deemed to have been received
pursuant to
clauses (i) and (ii) of this paragraph (a) are hereinafter
sometimes referred
to as "Deemed Collections").
(b)
If at any time the
Seller shall wish to cause the reduction of
Capital of the Purchased Interest funded by CP Conduit Purchasers
or Committed
Purchasers (but not to commence the liquidation, or reduction to
zero, of the
entire Capital of the Purchased Interest), the Seller may do so as
follows:
(i) the Seller shall
give each Funding Agent and the Servicer at
least two Business Days' prior written notice thereof (including
the amount of
such proposed reduction and the proposed date on which such
reduction will
commence);
(ii) on the proposed date of commencement of such reduction and
on
each day thereafter, the Servicer shall cause Collections not to be
reinvested
pursuant to Section 1.4 or 1.5, as applicable, until the amount
thereof not so
reinvested shall equal the desired amount of reduction; and
(iii) the Servicer shall hold such Collections in trust in the
Concentration Account (or, if required pursuant to Section 1.5,
transfer to the
Collection Account) for the benefit of such Purchasers, for payment
to each
applicable Funding Agent ratably among all such Purchasers in the
related
Purchaser Group entitled to payment thereof (based on the amount
owing to such
Purchasers in such categories at such time) on the next Settlement
Date
immediately following the current Settlement Period, and the
Capital (and each
applicable Net Investment) of the Purchased Interest shall be
deemed reduced in
the amount to be paid to the Funding Agents only when in fact
finally so paid;
provided, that:
(A) notwithstanding
the requirement to make such a payment on a
Settlement Date as described in clause (iii) of this Section
1.6(b), the
Seller may, prior to the occurrence and continuation of any
Termination
Event, so long as sufficient funds have been retained or deposited
in the
Collection Account therefor (including out of any funds of the
Seller
deposited therein and available therefor at such time), and so long
as the
Seller has provided each Funding Agent at least two Business Days
prior
written notice thereof (such notice to be received on or prior to
11:00
a.m.
on such Business Day), make the payments (in accordance with
such
clause (iii) of this Section 1.6(b), other than the requirement
that such
payments be made on a Settlement Date) to reduce the Capital (and
each
applicable Net Investment), on any day during such related
Settlement
Period prior to such Settlement Date, and shall (x) on the date of
such
payments, to the extent that any applicable Purchaser is funding
its Net
Investment (or any portion thereof) at such time through a source
of funds
which matures or is maturing on such date, pay to such Purchaser
(or the
applicable Funding Agent on its behalf) in respect of the accrued
and
unpaid Discount on such source of funds at such time, an amount
equal to
such
Purchaser's ratable share of the Discount (with respect to such
source
of
funds) being held by the Servicer or the Collateral Agent for
the
benefit of all Purchasers in respect of the aggregate Discount
pursuant to
Section 1.4 or 1.5, as the case may be, and (y) on the next
succeeding
Settlement Date relating to any applicable Net Investment for
any
Purchaser, pay to such Purchaser the amount, if any, of additional
Discount
related to the applicable Net Investment (or portion thereof) so
reduced
(and
with respect to which the related source of funds therefor does
not
mature on the date of such repayment as described in clause (x) of
this
Section 1.6(b)), that would have accrued on such Net Investment (or
portion
thereof) through the maturity date of such related source of funds,
or the
portion so reduced (such amount, the applicable "Breakage Fee")
(as
notified to the Seller in writing on or prior to such Settlement
Date by
the
applicable Funding Agent for such Purchaser) and payable at the
time
and
in the same order of priority that Discount is payable on such
date
pursuant to Section 1.4 or 1.5, as the case may be; it being
understood
that
any Purchaser who receives a Breakage Fee pursuant to clause (y)
of
this
Section 1.6(b)(ii)(A) on any Settlement Date, shall (or shall
cause
the
applicable Funding Agent on its behalf), on or prior to the
second
Business Day following such Settlement Date on which such Breakage
Fee was
received, pay to the Seller an amount equal to the income, if any,
received
by
such Purchaser (up to an amount not exceeding the applicable
Breakage
Fee
paid with respect thereto), from investing the amounts received by
it
from
the Seller to so reduce such Net Investment (or portion thereof)
in
accordance with this paragraph (A), as determined by the applicable
Funding
Agent, which determination shall be binding and conclusive absent
manifest
error. In addition, if
any such reduction payment is made prior to the
related Settlement Date, the amount of any such reduction shall be
not less
than
$5,000,000 (with respect to payments made to any Purchaser) and
shall
be
an integral multiple of $1,000,000, and the Net Investment of
any
Purchaser after giving effect to such reduction, if not reduced to
zero,
shall be not less than $5,000,000 and shall be in an integral
multiple of
$500,000, and
(B) the Seller shall
choose a reduction amount, and the date of
commencement thereof, so that to the extent practicable such
reduction
shall commence and conclude in the same Settlement Period.
Section 1.7.
Fees. The Seller shall
pay to each Funding Agent for the
benefit of the Purchasers in the related Purchaser Group in
accordance with the
provisions set forth in Sections 1.4 and 1.5 certain fees in the
amounts and on
the dates set forth in one or more letters, dated the date hereof
(or dated the
date any such Purchaser becomes a party hereto pursuant to an
Assumption
Agreement, a Transfer Supplement or otherwise), among the Servicer,
the Seller,
and each applicable Funding Agent, respectively (as any such letter
agreement
may be amended, supplemented or otherwise modified from time to
time, each, a
"Fee Letter").
Section 1.8.
Payments and Computations, Etc. (a) All amounts to be paid
or deposited by the Seller or the Servicer hereunder shall be made
without
reduction for offset or counterclaim and shall be paid or deposited
no later
than noon on the day when due in same day funds to the account
designated to the
Servicer at such time by the applicable Funding Agent. All amounts
received
after noon will be deemed to have been received on the next
Business Day.
(b)
The Seller or the
Servicer, as the case may be, shall, to the extent
permitted by law and not otherwise included within the definition
of "Discount"
or otherwise provided hereunder, pay interest on any amount not
paid or
deposited by the Seller or the Servicer, as the case may be, when
due hereunder,
at an interest rate equal to 2% per annum above the Eurodollar Rate
or Base
Rate, as applicable, payable on demand.
(c)
All computations of
interest under clause (b) and all computations of
Discount, fees and other amounts hereunder shall be made on the
basis of a year
of 360 days except with respect to Discount or other amounts
calculated by
reference to the Base Rate that shall be calculated on the basis of
a year of
365 or 366 days, as applicable, for the actual number of days
elapsed. Whenever
any payment or deposit to be made hereunder shall be due on a day
other than a
Business Day, such payment or deposit shall be made on the next
Business Day and
such extension of time shall be included in the computation of such
payment or
deposit.
Section 1.9.
Increased Costs. (a)
If any Funding Agent, any Purchaser,
any Program Support Provider or any of their respective Affiliates
(each an
"Affected Person") reasonably determines that the existence of or
compliance
with: (i) any law or regulation or any change therein or in the
interpretation
or application thereof, in each case adopted, issued or occurring
after the date
hereof, or (ii) any request, guideline or directive from any
central bank or
other Governmental Authority (whether or not having the force of
law) issued or
occurring after the date of this Agreement, affects or would affect
the amount
of capital required or expected to be maintained by such Affected
Person, and
such Affected Person determines that the amount of such capital is
increased by
or based upon the existence of any commitment to make purchases of,
or issue
Letters of Credit in respect of (or otherwise to maintain the
investment in)
Pool Receivables related to this Agreement or any related liquidity
facility,
credit enhancement facility and other commitments of the same type,
then, upon
written demand by such Affected Person (accompanied by the
certificate referred
to in the next sentence, with a copy to the applicable Funding
Agent), the
Seller shall promptly pay to the applicable Funding Agent, for the
account of
such Affected Person, from time to time as specified by such
Affected Person,
additional amounts sufficient to compensate such Affected Person.
A certificate
describing in reasonable detail such amounts and the basis for such
Affected
Person's demand for such amounts submitted to the Seller and the
applicable
Funding Agent by such Affected Person shall be conclusive and
binding for all
purposes, absent manifest error.
(b)
If, due to either: (i)
the introduction of or any change in or in the
interpretation of any law or regulation occurring after the date
hereof or
(ii) compliance with any guideline or request occurring after the
date hereof
from any central bank or other Governmental Authority (whether or
not having the
force of law), there shall be any increase in the cost to any
Affected Person of
agreeing to purchase or purchasing, or maintaining the ownership
of, the
Purchased Interest in respect of which Discount is computed by
reference to the
Eurodollar Rate, then, upon written demand by such Affected Person
(accompanied
by the certificate referred to in the next sentence, with a copy to
the
applicable Funding Agent), the Seller shall promptly pay to such
Affected
Person, from time to time as specified by such Affected Person,
additional
amounts sufficient to compensate such Affected Person for such
increased costs.
A certificate describing, in reasonable detail, such amounts and
the basis for
such Affected Person's demand for such amounts submitted to the
Seller and the
applicable Funding Agent by such Affected Person shall be
conclusive and binding
for all purposes, absent manifest error.
(c)
In determining the
additional amounts necessary to compensate an
Affected Person pursuant to clause (a) or (b) of this Section 1.9,
such Affected
Person may use any reasonable method of averaging and attribution
that it (in
its sole and absolute discretion) shall deem applicable.
(d)
Each Affected Person
will promptly notify the Seller of any event of
which it has knowledge that will entitle such Affected Person to
compensation
pursuant to this Section 1.9 and will use all reasonable efforts to
take such
action as it deems appropriate to avoid the need for, or reduce the
amount of,
such compensation that would not be otherwise disadvantageous to
such Affected
Person. For purposes
of this Section 1.9, an Affected Person shall be deemed to
have promptly notified the Seller of an event if such notice is
given to the
Seller within 6 months of the date such Affected Person obtains
knowledge of
such event.
Section 1.10.
Requirements of Law. If any Affected Person reasonably
determines that the existence of or compliance with: (a) any law or
regulation
or any change therein or in the interpretation or application
thereof, in each
case adopted, issued or occurring after the date hereof, or (b) any
request,
guideline or directive from any central bank or other Governmental
Authority
(whether or not having the force of law) issued or occurring after
the date of
this Agreement:
(i) subjects such
Affected Person to any tax of any kind whatsoever
with respect to this Agreement, any increase in the Purchased
Interest or in the
amount of Capital relating thereto, or does or shall change the
basis of
taxation of payments to such Affected Person on account of
Collections, Discount
or any other amounts payable hereunder (excluding taxes imposed on
the overall
pre-tax net income of such Affected Person, taxes based in whole or
part on
receipts of such Affected Person (excluding taxes in the nature of
sales and use
taxes and withholding taxes), or franchise taxes imposed on such
Affected
Person, by any jurisdiction unless such Affected Person is subject
to tax in
such jurisdiction solely as a result of the transactions
contemplated by this
Agreement,
(ii) imposes, modifies or holds applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held
by, or
deposits or other liabilities in or for the account of, purchases,
advances or
loans by, or other credit extended by, or any other acquisition of
funds by,
any office of such Affected Person that are not otherwise included
in the
determination of the Eurodollar Rate or the Base Rate hereunder,
or
(iii) imposes on such Affected Person any other condition,
and the result of any of the foregoing is: (A) to increase the cost
to such
Affected Person of acting as Collateral Agent or Funding Agent, or
of agreeing
to purchase or purchasing or maintaining the ownership of undivided
percentage
ownership interests with regard to the Purchased Interest (or
interests therein)
or any Portion of Capital (including by issuing or agreeing to
issue any Letters
of Credit), or (B) to reduce any amount receivable hereunder
(whether directly
or indirectly), then, in any such case, upon written demand by such
Affected
Person (accompanied by the certificate hereinafter described, with
a copy to the
applicable Funding Agent), the Seller shall promptly pay to such
Affected Person
additional amounts necessary to compensate such Affected Person for
such
additional cost or reduced amount receivable. All such amounts
shall be payable
as incurred. A certificate from such Affected Person to the Seller
describing in
reasonable detail the amount and basis for the amount of such
additional costs
or reduced amount receivable shall be conclusive and binding for
all purposes,
absent manifest error.
Each Affected Person will promptly notify the Seller of
any event of which it has knowledge that will entitle such Affected
Person to
compensation pursuant to this Section 1.10 and will use all
reasonable efforts
to take such action as it deems appropriate to avoid the need for,
or reduce the
amount of, such compensation that would not be otherwise
disadvantageous to such
Affected Person. For
purposes of this Section 1.10, an Affected Person shall be
deemed to have promptly notified the Seller of an event if such
notice is given
to the Seller within 6 months of the date such Affected Person
obtains knowledge
of such event.
Section 1.11.
Inability to Determine Eurodollar Rate. If any Funding
Agent shall have determined before the first day of any Settlement
Period (which
determination shall be conclusive and binding upon the parties
hereto), by
reason of circumstances affecting the interbank Eurodollar market,
either that:
(a) dollar deposits in the relevant amounts and for the relevant
Settlement
Period are not available, (b) adequate and reasonable means do not
exist for
ascertaining the Eurodollar Rate for such Settlement Period or (c)
the
Eurodollar Rate determined pursuant hereto does not accurately
reflect the cost
to the applicable Affected Person (as conclusively determined by
such Funding
Agent) of maintaining any Portion of Capital during such Settlement
Period, such
Funding Agent shall promptly give telephonic notice of such
determination,
confirmed in writing, to the Seller before the first day of such
Settlement
Period. Upon delivery of such notice: (i) no Portion of Capital
shall be funded
thereafter at the Alternate Rate determined by reference to the
Eurodollar Rate
unless and until such Funding Agent shall have given notice to the
Seller that
the circumstances giving rise to such determination no longer
exist, and (ii)
with respect to any outstanding Portions of Capital then funded at
the Alternate
Rate determined by reference to the Eurodollar Rate, such Alternate
Rate shall,
on the immediately succeeding Settlement Date, automatically be
converted to the
Alternate Rate determined by reference to the Base Rate at the
respective last
days of the then-current Settlement Periods relating to such
Portions of
Capital.
Section 1.12. Sharing
of Payments, etc. If
any Purchaser (for purpose of
this Section 1.12 only, a "Recipient") shall obtain any payment
(whether
voluntary, involuntary, through the exercise of any right of
setoff, or
otherwise) on account of any interest in the Purchased Interest
owned by it in
excess of its ratable share thereof, such Recipient shall forthwith
purchase
from the other Purchasers entitled to a share of such amount
participations in
the percentage interests owned by such Persons as shall be
necessary to cause
such Recipient to share the excess payment ratably with each such
other Person
entitled thereto; provided, however, that if all or any portion of
such excess
payment is thereafter recovered from such Recipient, such purchase
from each
such other Person shall be rescinded and each such other Person
shall repay to
the Recipient the purchase price paid by such Recipient for such
participation
to the extent of such recovery, together with an amount equal to
such other
Person's ratable share (according to the proportion of (a) the
amount of such
other Person's required payment to (b) the total amount so
recovered from the
Recipient) of any interest or other amount paid or payable by the
Recipient in
respect of the total amount so recovered.
Section 1.13.
Expiration or Extension of Commitments. (a) For each of the
first three years after the Closing Date, the Seller may request
the extension
of any Purchaser Group's Commitment Expiry Date for an additional
three hundred
and sixty four (364) days from any Purchaser Group's Commitment
Expiry Date then
in effect by providing the applicable Funding Agent with a written
request for
such extension no fewer than forty-five (45) days, but no more than
sixty (60)
days prior to the relevant anniversary of the Closing Date.
The related
Funding
Agent shall provide written notice to each other Funding Agent and
the Seller on
or prior to the thirtieth (30th) day (the "Consent Date") following
the
applicable Funding Agent's actual receipt of such written request
for extension
of its desire to extend (any such Funding Agent's Purchaser Group,
an "Extending
Committed Purchaser") or not to so extend (any such Funding Agent's
Purchaser
Group, a "Non-Extending Committed Purchaser") such date.
(b)
If Purchaser Groups holding less than 100% of the aggregate
Commitments
of all Purchaser Groups consent to such extension, then the Seller
may elect by
written notice to the Funding Agents to either:
(i) continue this
receivables financing facility for such additional
period with an aggregate Commitment equal to the then effective
aggregate
Commitment of all Purchaser Groups less the Commitment of the
Non-Extending
Committed Purchaser(s); or
(ii) require any such Non-Extending Committed Purchaser(s) and
the
related Purchasers(s) to execute a Transfer Supplement in
accordance with
Section 6.3(d) with
respect to all of such Non-Extending Committed
Purchaser(s) Commitment and their other interests, rights and
obligations
under this Agreement as follows:
A. first, to any
Committed Purchaser(s) who have consented to extend
and agreed (each in its sole discretion at such time) to assume
all the Non-Extending Committed Purchaser(s) Commitment(s) on a
ratable basis,
B. second, if
all the Extending Committed Purchasers have not
consented to and
agreed to assume the Non-Extending Committed
Purchaser(s) Commitment(s) on a ratable basis, to any Extending
Committed Purchaser(s) on a non-ratable basis, and
C. third, to the
extent the Extending Committed Purchasers do not
agree to assume the entire balance of the Commitments, to an
additional Purchaser Group under and in accordance with the
terms
of Section 1.14;
provided, however, that (x) no such assignment shall conflict with
any law, (y)
each such assignment shall be at the Seller's cost and expense, and
(z) the
purchase price to be paid to each Non-Extending Committed Purchaser
shall be an
amount equal to the Net Exposure and accrued and unpaid Discount
and Fees
attributable to such Non-Extending Committed Purchaser.
Section 1.14.
Purchaser Groups and Purchasers. The Seller may (a) with
the written consent of the Collateral Agent (not to be unreasonably
withheld or
delayed), add additional Persons as Purchasers to an existing
Purchaser Group
(with the prior written consent of the related Funding Agent) or
(b) pursuant to
and in accordance with the terms set forth in Section 1.1(c) or
Section
1.13(b)(ii), cause an existing Purchaser Group to increase its
Commitment in
connection with a corresponding increase in the Facility Limit;
provided,
however, that the Commitment of any Purchaser Group may only be increased with
the consent of the related Funding Agent or (c) pursuant to and in
accordance
with the terms set forth in Section 1.1(d), and subject to the
proviso set forth
in such clause, or Section 1.13(b)(ii) add one or more Purchaser
Groups as
parties hereto. Each
new Purchaser Group shall become a party hereto by
executing and delivering to each Funding Agent and the Seller an
Assumption
Agreement (each, an "Assumption Agreement") in the form of Exhibit
VI hereto
(which Assumption Agreement shall, in the case of any new Purchaser
Group be
executed by each Person (including the related Funding Agent) in
such new
Purchaser Group).
Section 1.15.
Obligations Several.
Each Committed Provider's obligation
hereunder shall be several, such that the failure of any Committed
Provider to
make a payment in connection with any Funded Purchase hereunder
shall not
relieve any other Committed Provider of its obligation hereunder to
make payment
(or issue Letters of Credit, as applicable) for any purchase.
Further, if any
Committed Provider fails to satisfy its obligation to make a
purchase or issue a
Letter of Credit as required hereunder, upon receipt of notice of
such failure
from the relevant Funding Agent, subject to the limitations set
forth herein,
the non-defaulting Committed Providers (but limited to the
Committed Purchasers
in the case of a purchase requested in cash, and limited to the LC
Banks in the
case of a purchase request in consideration for the issuance of one
or more
Letters of Credit) in such defaulting Committed Provider's
Purchaser Group shall
purchase the defaulting Committed Provider's portion of the related
purchase pro
rata in proportion to their relative Commitments (determined
without regard to
the Commitment of the defaulting Committed Purchaser; it being
understood that a
defaulting Committed Provider's Commitment of any purchase shall be
first put to
the Committed Providers related to such defaulting Committed
Provider and
thereafter if there are no other Committed Providers in its
Purchaser Group or
if such other Committed Providers are also defaulting Committed
Providers, then
such defaulting Committed Provider's portion of such purchase shall
be put to
each other Purchaser Group ratably and applied in accordance with
this Section
1.15). Notwithstanding
anything in this Section 1.15 to the contrary, no
Committed Provider shall be required to make a purchase pursuant to
this Section
1.15 for an amount which (a) would cause the aggregate Net Exposure
(after
giving effect to such purchase) of the related Purchaser Group to
exceed the
Commitment for such Purchaser Group or (b) would cause the sum of
(i) the
Capital plus (ii) the LC Aggregate Stated Amount to exceed the
Facility Limit.
Notwithstanding the foregoing, no Committed Purchaser shall ever be
required to
fund a purchase other than in cash, and no LC Bank shall ever be
required to
fund a purchase other than through the issuance of one or more
Letters of
Credit.
Section 1.16. Issuance
of Letters of Credit.
(a)
The Seller may, on a
non-pro rata basis, request an LC Bank, upon two
(2) Business Days' prior written notice submitted on or before
11:00 a.m., to
issue a Letter of Credit by delivering to the Funding Agent for the
applicable
LC Bank (with a copy to the Collateral Agent), an LC Bank's form of
letter of
credit application with such changes as are agreed by such LC Bank
and the
Seller (each "Letter of Credit Application"); and, such other
certificates,
documents and other papers and information as such LC Bank may
reasonably
request. The Seller
also has the right to give instructions and make agreements
with respect to any Letter of Credit Application and the
disposition of
documents, and to agree with LC Bank upon any amendment, extension
or renewal of
any Letter of Credit.
(b)
Each Letter of Credit
shall, among other things, (i) provide for
written demands for payment when presented for honor thereunder in
accordance
with the terms thereof and when accompanied by the documents
described therein
(ii) and have an expiry date not later than eighteen (18) months
after such
Letter of Credit's date of issuance and in no event later than
twelve (12)
months after the related Purchaser Group's Commitment Expiry Date
then in
effect. Each Letter of Credit shall be subject either to the
Uniform Customs
and Practice for
Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500, and any amendments or revisions
thereof adhered
to by an LC Bank or the International Standby Practices
(ISP98-International
Chamber of Commerce Publication Number 590), and any amendments or
revisions
thereof adhered to by an LC Bank, as determined by the applicable
LC Bank.
(c)
The applicable Funding
Agent shall promptly notify the related LC
Bank, at its address for notices hereunder of the request by the
Seller for a
Letter of Credit hereunder, and shall provide such LC Bank with the
Letter of
Credit Application delivered to such Funding Agent by the Seller
pursuant to
paragraph (a), above, by the close of business on the day received
or if
received on a day that is not a Business Day or on any Business Day
after
11:00 a.m., on such day, on the next Business Day.
Section 1.17. Form of
Letters of Credit.
Subject to the terms and conditions hereof, an LC Bank shall issue
or cause
the issuance of Letters of Credit ("Letters of Credit") on behalf
of Seller
(and, if applicable, for the account of, the Originator in favor of
such
beneficiaries as the Originator may elect) in a form acceptable to
the LC Bank;
provided, however, that an LC Bank will not be required to issue or
cause to be
issued any Letter of Credit to the extent that the issuance of such
Letter of
Credit (a) would then cause the Net Exposure of the related
Purchaser Group to
exceed the Commitment of such Purchaser Group or (b) would then
cause the sum of
(i) the Capital plus (ii) the requested LC Stated Amount (together
with the LC
Aggregate Stated Amount of all other Letters of Credit issued by
all LC Banks)
to exceed the Facility Limit or (c) would then cause the aggregate
LC Stated
Amounts (together with the aggregate LC Stated Amounts of all other
Letters of
Credit issued by such LC Bank) to exceed such LC Bank's LC
Sub-Commitment.
All
amounts drawn upon Letters of Credit shall accrue Discount.
Letters of Credit
that have not been drawn upon shall not accrue Discount.
Section 1.18.
Requirements For Issuance of Letters of Credit.
The
Seller shall authorize and direct the applicable LC Bank to name
the
Seller as the "Applicant" or "Account Party" of each Letter of
Credit.
Section 1.19.
Disbursements, Reimbursement. Upon any request for a
drawing under a Letter of Credit by the beneficiary or transferee
thereof, the
applicable LC Bank will promptly notify the related Funding Agent,
the
Collateral Agent and the Seller of such request. If an LC Bank pays any amount
under any Letter of Credit prior to 11:00 a.m. on any Drawing Date
(as defined
below), the Seller shall reimburse (such obligation to reimburse
each applicable
LC Bank shall sometimes be referred to as a "Reimbursement
Obligation") such LC
Bank prior to 2:00 p.m. on each date that an amount is paid by an
LC Bank under
any Letter of Credit (each such date, a "Drawing Date") in an
amount equal to
the amount so paid by an LC Bank. (Any cash collateral held by or on
behalf of
an LC Bank in respect of a Letter of Credit shall be applied to
discharge the
Seller's Reimbursement Obligation with respect thereto so long as
any remaining
cash collateral with respect to that Letter of Credit equals or
exceeds any
undrawn amount under that Letter of Credit following such
application.) If
an
LC Bank pays any amount under any Letter of Credit on or after
11:00 a.m. on any
Drawing Date, the Seller shall reimburse such LC Bank prior to
12:00 p.m. on the
next Business Day occurring after the Drawing Date in an amount
equal to the
amount so paid by an LC Bank. If the Seller fails to reimburse
an LC Bank for
the full amount of any drawing under any Letter of Credit when due,
the Seller
shall be deemed to have requested that a Funded Purchase be made by
a CP Conduit
Purchaser or Committed Purchaser in such LC Bank's Purchaser Group
to be
disbursed on such date under such Letter of Credit, subject to the
amount of the
unutilized portion of the Commitment for such Purchaser Group;
provided that if
the amount so drawn under such Letter of Credit is less than
$250,000 and cannot
be funded by a CP Conduit Purchaser, the Seller shall be deemed to
have
requested that a Funded Purchase be made by a Committed Purchaser
in such LC
Bank's Purchaser Group, and for all purposes of this Agreement and
each other
Transaction Document, "Discount" with respect to such amount
shall,
notwithstanding anything to the contrary in this Agreement or in
any other
Transaction Document, be calculated at a rate equal to the
Eurodollar Rate plus
0.50%, or if the Eurodollar Rate is unavailable, at the Base Rate
until the
conditions to fund at the Eurodollar Rate have been satisfied.
Any notice given
by an LC Bank pursuant to this Section may be oral if immediately
confirmed in
writing; provided that the lack of such an immediate confirmation
shall not
affect the conclusiveness or binding effect of such notice.
Section 1.20.
Documentation.
The
Seller agrees to be bound by the terms of each Letter of Credit
Application. If there is a conflict between a Letter of Credit
Application and
this Agreement, this Agreement shall govern. It is understood and agreed
that,
except in the case of gross negligence or willful misconduct by the
applicable
LC Bank, such LC Bank shall not be liable for any error, negligence
and/or
mistakes, whether of omission or commission, in following the
Seller's
instructions or those contained in the Letters of Credit or any
modifications,
amendments or supplements thereto.
Section 1.21.
Determination to Honor Drawing Request.
In
determining whether to honor any request for drawing under any
Letter of
Credit by the beneficiary thereof, the applicable LC Bank shall be
responsible
only to determine that the documents and certificates required to
be delivered
under such Letter of Credit have been delivered and that they
comply on their
face with the requirements of such Letter of Credit and that any
other drawing
condition appearing on the face of such Letter of Credit has been
satisfied in
the manner so set forth.
Section 1.22. Nature
of Reimbursement Obligations.
Each
LC Bank's obligation in accordance with this Agreement to make
advances as
a result of a drawing
under one of its Letters of Credit and the
obligations of the Seller to reimburse such an LC Bank upon a draw
under such a
Letter of Credit,
shall be performed strictly in accordance with the terms of
this Article I, including the following circumstances:
(i) any set-off,
counterclaim, recoupment, defense or other right
which any Person may have against such LC Bank, the related Funding
Agent or any
other Purchaser in such LC Bank's Purchaser Group or any other
Person for any
reason whatsoever;
(ii) the failure of the Seller or any other Person to comply with
the
conditions set forth in this Agreement for the making of a Funded
Purchase,
reinvestments, requests for Letters of Credit or otherwise, it
being
acknowledged that such conditions are not required for the making
of
participation advances hereunder;
(iii) any lack of validity or enforceability of any Letter of
Credit;
(iv) any claim of breach of warranty that might be made by the
Seller
or such LC Bank against the beneficiary of a Letter of Credit, or
the existence
of any claim, set-off, defense or other right which the Seller or
such LC Bank
may have at any time against a beneficiary, any successor
beneficiary or any
transferee of any Letter of Credit or the proceeds thereof (or any
Persons for
whom any such transferee may be acting), such LC Bank or any other
Person,
whether in connection with this Agreement, the transactions
contemplated herein
or any unrelated transaction (including any underlying transaction
between the
Seller or any Subsidiaries of the Seller or any Affiliates of the
Seller and the
beneficiary for which any Letter of Credit was procured);
(v) the lack of power
or authority of any signer of, or lack of
validity, sufficiency, accuracy, enforceability or genuineness of,
any draft,
demand, instrument, certificate or other document presented under
any Letter
of Credit, or any such draft, demand, instrument, certificate or
other document
proving to be forged, fraudulent or invalid in any respect or any
statement
therein being untrue or inaccurate in any respect, even if such LC
Bank or the
related Funding Agent has been notified thereof;
(vi) payment by the LC Bank under any Letter of Credit against
presentation of a demand, draft or certificate or other document
which does not
comply with the terms of such Letter of Credit other than as a
result of the
gross negligence or willful misconduct of the LC Bank;
(vii) the solvency of, or any acts or omissions by, any
beneficiary
of any Letter of Credit, or any other Person having a role in any
transaction
or obligation relating to a Letter of Credit, or the existence,
nature, quality,
quantity, condition, value or other characteristic of any property
or services
relating to a Letter of Credit;
(viii) any failure by the LC Bank or any of the LC Bank's
Affiliates
to issue any Letter of Credit in the form requested by the Seller,
unless the
LC Bank has received written notice from the Seller of such failure
within
three Business Days after the LC Bank shall have furnished the
Seller a copy
of such Letter of Credit and such error is material and no drawing
has been
made thereon prior to receipt of such notice;
(ix) any Material Adverse Effect on the Seller, the Originator
or
any Affiliates thereof;
(x) any breach of this Agreement or any Transaction Document by
any
party thereto;
(xi) the occurrence or continuance of an Event of Bankruptcy
with
respect to the Seller, the Originator or any Affiliate thereof;
(xii) the fact that a Termination Event or an Unmatured
Termination
Event shall have occurred and be continuing; and
(xiii) the fact that this Agreement or the obligations of Seller
or
Servicer hereunder shall have been terminated.
Section 1.23.
Liability for Acts and Omissions.
As
between the Seller, on the one hand, and the Collateral Agent,
the
applicable LC Bank, the related Funding Agent and the other members
of the
Purchaser Group for the applicable LC Bank, on the other, the
Seller assumes all
risks of the acts and omissions of, or misuse of the Letters of
Credit by, the
respective beneficiaries of such Letters of Credit. In furtherance and not in
limitation of the foregoing, none of the Collateral Agent, the LC
Banks, the
related Funding Agents or any other Person shall be responsible
for: (i) the
form, validity, sufficiency, accuracy, genuineness or legal effect
of any
document submitted by any party in connection with the application
for an
issuance of any such Letter of Credit, even if it should in fact
prove to be in
any or all respects invalid, insufficient, inaccurate, fraudulent
or forged;
(ii) the validity or sufficiency of any instrument transferring or
assigning or
purporting to transfer or assign any such Letter of Credit or the
rights or
benefits thereunder or proceeds thereof, in whole or in part, which
may prove to
be invalid or ineffective for any reason; (iii) any claim of the
Seller against
any beneficiary of such Letter of Credit, or any such transferee,
or any dispute
between or among the Seller and any beneficiary of any Letter of
Credit or any
such transferee; (iv) errors, omissions, interruptions or delays in
transmission
or delivery of any messages, by mail, cable, telegraph, telex or
otherwise,
whether or not they be in cipher; (v) errors in interpretation of
technical
terms; (vi) any loss or delay in the transmission or otherwise of
any document
required in order to make a drawing under any such Letter of Credit
or of the
proceeds thereof; (vii) the misapplication by the beneficiary of
any such Letter
of Credit of the proceeds of any drawing under such Letter of
Credit; or (viii)
any consequences arising from causes beyond the control of the
Collateral Agent,
any LC Bank or any related Funding Agent, including any dishonor of
any Letter
of Credit resulting from any act or omission, whether rightful or
wrongful, of
any present or future de jure or de facto Governmental Authority,
and none of
the foregoing shall affect or impair, or prevent the vesting of,
any of an LC
Bank's rights or powers hereunder. None of the LC Bank, the
applicable Funding
Agent, the other members of the Purchaser Group for the LC Bank nor
the
Collateral Agent shall have any liability or responsibility by
reason of or in
connection with the issuance or transfer of any Letter of Credit or
any payment
or failure to make any payment thereunder, or any error, omission,
interruption,
loss or delay in transmission or delivery of any draft, notice or
other
communication under or relating to any Letter of Credit any error
in
interpretation of technical terms or any consequence arising from
causes beyond
the control of the LC Bank; provided however that none of foregoing
shall excuse
the LC Bank from liability to the Seller, any Originator or any
affiliate of any
Originator to the extent of any direct damages suffered by the
Seller, any
Originator or any affiliate of any Originator that are caused by
the LC Bank's
failure to exercise care when determining whether drafts and other
documents
presented under a Letter of Credit comply with the terms thereof.
In the
absence of gross negligence or willful misconduct on the part of LC
Bank, the LC
Bank shall be deemed to have exercised care in each such
determination.
Without
limiting the generality of the foregoing, the parties agree that,
with respect
to documents presented which appear on their face to be in
substantial
compliance with the terms of a Letter of Credit, the LC Issuing
Bank may, in its
sole discretion, either (A) accept and make payment upon such
documents without
responsibility for further investigation, regardless of any notice
or
information to the contrary, or (B) refuse to accept and make
payment upon such
documents if such documents do not strictly comply with the terms
of such Letter
of Credit.
Without limiting the generality of the foregoing, the Collateral
Agent,
each LC Bank, the related Funding Agents, each other Purchaser and
each of their
respective Affiliates (i) may rely on any written communication
believed in good
faith by such Person to have been authorized or given by or on
behalf of the
applicant for a Letter of Credit; (ii) may honor any presentation
if the
documents presented appear on their face to comply with the terms
and conditions
of the relevant Letter of Credit; (iii) may honor a previously
dishonored
presentation under a Letter of Credit, whether such dishonor was
pursuant to a
court order, to settle or compromise any claim of wrongful
dishonor, or
otherwise, and shall be entitled to reimbursement to the same
extent as if such
presentation had initially been honored, together with any interest
paid by an
LC Bank or its Affiliates; and (iv) may pay any paying or
negotiating bank
claiming that it rightfully honored under the laws or practices of
the place
where such bank is located.
Section 1.24.
Termination of Letters of Credit. An LC Bank shall
terminate a given Letter of Credit upon receipt of appropriate
documentation
from the beneficiary thereof or, upon the expiration thereof, and
return to the
Seller any cash collateral in excess of the aggregate LC Stated
Amount.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
SECTION 2.1.
Representations and Warranties; Covenants. Each of the
Seller and the Servicer hereby makes the representations and
warranties, and
hereby agrees to perform and observe the covenants, applicable to
it set forth
in Exhibits III and IV respectively.
Section 2.2.
Termination Events. If
any of the Termination Events set
forth in Exhibit V shall occur, the Collateral Agent (acting at the
direction
of each of the Funding Agents) may, by written notice to the
Seller, declare
the Facility Termination Date to have occurred (in which case the
Facility
Termination Date shall be deemed to have occurred); provided, that
the Facility
Termination Date shall automatically occur upon the occurrence of
any event
(without any requirement for the passage of time or the giving of
notice)
described in paragraph (f) of Exhibit V. Upon any such declaration,
occurrence
or deemed occurrence of the Facility Termination Date, the
Collateral Agent, the
Funding Agents and the Purchasers shall have, in addition to the
rights and
remedies that they may have under this Agreement, all other rights
and remedies
provided after default under the New York UCC and under other
applicable law,
which rights and remedies shall be cumulative.
ARTICLE III.
INDEMNIFICATION
SECTION 3.1.
Indemnities by the Seller. Without duplicating any
amounts
otherwise payable by the Seller pursuant to Sections 1.9 and 1.10
of this
Agreement, and without limiting any other rights that the
Collateral Agent, the
Funding Agents, the Purchasers, any Program Support Provider or any
of their
respective Affiliates, employees, officers, directors, agents,
counsel,
successors, transferees or assigns (each, an "Indemnified Party")
may have
hereunder or under applicable law, the Seller hereby agrees to
indemnify each
Indemnified Party from and against any and all claims, damages,
expenses, costs,
losses and liabilities (including Attorney Costs) (all of the
foregoing being
collectively referred to as "Indemnified Amounts") arising out of
or resulting
from this Agreement (whether directly or indirectly), the use of
proceeds of
purchases or reinvestments or issuances of Letters of Credit, the
ownership of
the Purchased Interest, or any interest therein, or in respect of
any
Receivable, Related Security or Contract, excluding, however: (a)
Indemnified
Amounts to the extent resulting from gross negligence or willful
misconduct on
the part of such Indemnified Party or its officers, directors,
agents (including
any successor Servicer appointed by the Funding Agents pursuant to
Section
4.1(a)) or counsel, (b) recourse (except as otherwise specifically
provided in
this Agreement) for uncollectible Receivables, or (c) any overall
net income
taxes, taxes based in whole or part on receipts (excluding taxes in
the nature
of sales and use taxes and withholding taxes), or franchise taxes
imposed on
such Indemnified Party by any jurisdiction unless such Indemnified
Party is
subject to tax in such jurisdiction solely as a result of the
transactions
contemplated by this Agreement). Subject to the exclusions set
forth in the
preceding sentence, but without otherwise limiting or being limited
by the
foregoing, the Seller shall pay on demand to each Indemnified Party
any and all
amounts necessary to indemnify such Indemnified Party from and
against any and
all Indemnified Amounts relating to or resulting from any of the
following:
(i) the failure of any
Receivable included in the calculation of the
Net Receivables Pool Balance as an Eligible Receivable to be an
Eligible
Receivable, the failure of any information contained in a Monthly
Report to be
true and correct, or the failure of any other information provided
to the
Collateral Agent, any Purchaser or any Funding Agent with respect
to
Receivables or this Agreement to be true and correct,
(ii) the failure of any representation, warranty or statement made
or
deemed made by the Seller (or any of its officers) under or in
connection with
this Agreement to have been true and correct as of the date made or
deemed made
in all respects,
(iii) the failure by the Seller to comply with any applicable
law,
rule or regulation with respect to any Pool Receivable or the
related Contract,
or the failure of any Pool Receivable or the related Contract to
conform to any
such applicable law, rule or regulation,
(iv) the failure to vest in the Collateral Agent (for the benefit
of
the Purchasers) a valid and enforceable: (A) perfected undivided
percentage
ownership interest, to the extent of the Purchased Interest, in the
Receivables
in, or purporting to be in, the Receivables Pool and the other Pool
Assets, or
(B) first priority perfected security interest in the Pool Assets,
in each case,
free and clear of any Adverse Claim,
(v) the failure to have filed, or any delay in filing,
financing
statements or other similar instruments or documents under the UCC
of any
applicable jurisdiction or other applicable laws with respect to
any Receivables
in, or purporting to be in, the Receivables Pool and the other Pool
Assets,
whether at the time of any Funded Purchase or reinvestment or
issuance of a
Letter of Credit or at any subsequent time,
(vi) any dispute, claim, offset or defense of an Obligor (other
than
discharge in bankruptcy of such Obligor) to the payment of any
Receivable in, or
purporting to be in, the Receivables Pool (including a defense
based on such
Receivable or the related Contract not being a legal, valid and
binding
obligation of such Obligor enforceable against it in accordance
with its terms),
or any other claim resulting from the sale of the goods or services
related to
such Receivable or the furnishing or failure to furnish such goods
or services
or relating to collection activities with respect to such
Receivable (if such
collection activities were performed by the Seller or by any agent
or
independent contractor retained by the Seller),
(vii) any failure of the Seller to perform its duties or
obligations
in accordance with the provisions hereof or under the
Contracts,
(viii) any products liability or other claim, investigation,
litigation or proceeding arising out of or in connection with
merchandise,
insurance or services that are the subject of any Contract,
(ix) the commingling of Collections at any time with other
funds,
(x) the use of proceeds of purchases or reinvestments or the
issuance of any Letters of Credit by the Seller, or
(xi) any reduction in Capital (or any applicable Net Exposure) as
a
result of the distribution of Collections pursuant to Section 1.4,
1.5 or 1.6,
if all or a portion of such distributions shall thereafter be
rescinded or
otherwise must be returned for any reason.
Section 3.2.
Indemnities by the Servicer. Without limiting any other
rights that the Collateral Agent, the Funding Agents, the
Purchasers or any
other Indemnified Party may have hereunder or under applicable law,
the Servicer
hereby agrees to indemnify each Indemnified Party from and against
any and all
Indemnified Amounts arising out of or resulting from (whether
directly or
indirectly): (a) the failure of any information contained in a
Monthly Report to
be true and correct, or the failure of any other information
provided to the
Collateral Agent, any Funding Agent or any Purchaser by, or on
behalf of, the
Servicer to be true and correct, (b) the failure of any
representation, warranty
or statement made or deemed made by the Servicer (or any of its
officers) under
or in connection with this Agreement to have been true and correct
in all
respects as of the date made or deemed made, (c) the failure by the
Servicer to
comply with any applicable law, rule or regulation with respect to
any Pool
Receivable or the related Contract, (d) any dispute, claim, offset
or defense of
the Obligor to the payment of any Receivable in, or purporting to
be in, the
Receivables Pool resulting from or related to the collection
activities with
respect to such Receivable, or (e) any failure of the Servicer to
perform its
duties or obligations in accordance with the provisions hereof.
Section 3.3.
Defense of Claims. (a)
Promptly after the receipt by an
Indemnified Party or Parties of a notice of the commencement of any
action,
suit, proceeding, investigation or claim against such Indemnified
Party or
Parties as to which it proposes to demand indemnification from the
Seller or
Servicer (either or both such parties, as applicable, the
"Indemnifying Party"
or "Parties") pursuant to Section 3.1 or 3.2, as applicable, such
Indemnified
Party or Parties shall notify the Indemnifying Party or Parties in
writing of
the commencement thereof; but the failure so to notify the
Indemnifying Party or
Parties will not relieve such Indemnifying Party or Parties from
any liability
which such Indemnifying Party or Parties may have to such
Indemnified Party or
Parties pursuant to Section 3.1 or 3.2, as applicable, unless and
to the extent
that such failure results in a material impairment of the
Indemnifying Party or
Parties ability to defend such action, suit, proceeding,
investigation or claim
in accordance with the terms of this Section 3.3. After such
notice, if (i) an
Indemnifying Party or Parties shall acknowledge (without prejudice
to any
exclusion of Indemnified Amounts as a result of an Indemnified
Party's gross
negligence or willful misconduct pursuant to Section 3.1 or 3.2) in
writing to
such Indemnified Party or Parties that such Indemnifying Party or
Parties shall
be obligated to indemnify such Indemnified Party or Parties for any
Indemnified
Amounts described in Section 3.1 or 3.2, as applicable, with
respect to such
action, suit, proceeding, investigation or claim, (ii) the
defendants in, or
targets of, any such action, suit, proceeding, investigation or
claim include
both the Indemnifying Party or Parties and any such Indemnified
Party or
Parties, and (iii) no Termination Event or Unmatured Termination
Event shall
have occurred and be continuing, the Indemnifying Party or Parties,
to the
extent that it or they shall wish, jointly with such Indemnified
Party or
Parties, shall be entitled to participate therein in defense of
such action,
suit, proceeding or investigation, and the Indemnifying Party or
Parties and
such Indemnified Party or Parties shall cooperate in the defense
thereof and
shall retain counsel reasonably satisfactory to the Indemnifying
Party or
Parties and such Indemnified Party or Parties to undertake the
joint defense of
such Indemnifying Party or Parties and such Indemnified Party or
Parties at such
Indemnifying Party's or Parties' cost, risk and expense.
If (i) in the
reasonable opinion of such Indemnified Party or Parties, the
engagement of such
counsel would present a conflict of interest that would prevent
such counsel
from effectively undertaking such joint defense, (ii) such
Indemnified Party or
Parties reasonably conclude that there may be legal defenses
available to it or
them that are different from or in addition to those available to
such
Indemnifying Party or Parties, (iii) such Indemnifying Party or
Parties fail to
employ counsel reasonably satisfactory to such Indemnified Party or
Parties in a
timely manner, or (iv) a Termination Event or Unmatured
Termination Event shall
have occurred and be continuing, then such Indemnified Party or
Parties may
employ separate counsel to represent or defend it or them in any
such action,
suit, proceeding or investigation and such Indemnifying Party or
Parties shall
pay all fees, expenses and disbursements of such counsel; provided,
however,
that in no event shall such Indemnifying Party or Parties be liable
for the
fees, expenses and disbursements of more than one counsel
representing all
Indemnified Parties that are related to the same Funding Agent and
that are
parties to the same action, suit, proceeding, investigation or
claim.
(b)
No Indemnifying Party
shall (i) without the prior written consent of
the relevant Indemnified Party or Parties (which consent shall not
be
unreasonably withheld or delayed) settle or compromise or consent
to the entry
of any judgment with respect to any pending action, suit,
proceeding,
investigation or claim in respect to which indemnification or
contribution may
be sought hereunder (whether or not the relevant Indemnified Party
or Parties
are actual or potential parties to such claim) unless such
settlement,
compromise or consent includes an unconditional release of each
relevant
Indemnified Party from all liability arising out of such action,
suit,
proceeding, investigation or claim or (ii) be liable for any
settlement of any
such action affected without its written consent (which consent
shall not be
unreasonably withheld or delayed), but if settled with its written
consent or
if there be a final judgment in favor of the plaintiff in any
action, the
Indemnifying Parties agree to indemnify and hold harmless any
Indemnified Party
from and against any indemnified amounts (subject to the terms of
Sections 3.1
and 3.2) relating thereto.
If
there is a dispute between any Indemnified Party or Parties, on the
one
hand, and any Indemnifying Party, on the other hand, as to whether
such
Indemnifying Party or Indemnified Party is acting reasonably in
objecting to any
proposed settlement, compromise or consent, such dispute shall be
resolved
through binding arbitration in New York, New York in accordance
with the
commercial arbitration rules of the American Arbitration
Association. There
shall be a single arbitrator to be selected by mutual agreement of
such
Indemnified Party or Parties and such Indemnifying Party or Parties
(or if such
parties cannot agree on an arbitrator, by an arbitrator selected by
a federal or
state court located in the City of New York). Any such arbitration must be
commenced not later than 30 days after the date such dispute
arose.
ARTICLE IV.
ADMINISTRATION AND COLLECTIONS
SECTION 4.1.
Appointment of the Servicer. (a) The servicing,
administering and collection of the Pool Receivables shall be
conducted by the
Person so designated from time to time as the Servicer in
accordance with this
Section 4.1. Until the
Funding Agents give notice to USS (in accordance with
this Section 4.1) of the designation of a new Servicer, USS is
hereby
designated as, and hereby agrees to perform the duties and
obligations of, the
Servicer pursuant to the terms hereof. Upon the occurrence and
during the
continuation of a Termination Event, the Funding Agents may
designate as
Servicer any Person (including itself) to succeed USS or any
successor Servicer,
on the condition in each case that any such Person so designated
shall agree to
perform the duties and obligations of the Servicer pursuant to the
terms hereof.
(b)
Upon the designation
of a successor Servicer as set forth in clause
(a), USS agrees it will terminate its activities as Servicer
hereunder in a
manner that the Funding Agents reasonably determine will facilitate
the
transition of the performance of such activities to the new
Servicer, and USS
shall cooperate with and assist such new Servicer. Such cooperation
shall
include access to and transfer of related records and use by the
new Servicer
of all licenses, hardware or software necessary or desirable to
collect the Pool
Receivables and the Related Security.
(c)
USS acknowledges that,
in making their decision to execute and deliver
this Agreement, the Collateral Agent, each Funding Agent and each
Purchaser have
relied on USS's agreement to act as Servicer hereunder.
Accordingly, USS agrees
that it will not voluntarily resign as Servicer.
(d)
The Servicer may with
the prior written consent of the Funding Agents,
delegate its duties and obligations hereunder to any subservicer
(each a "Sub-
Servicer"); provided, that, in each such delegation: (i) such
Sub-Servicer shall
agree in writing to perform the duties and obligations of the
Servicer pursuant
to the terms hereof, (ii) the Servicer shall remain primarily
liable for the
performance of the duties and obligations so delegated, (iii) the
Seller, the
Collateral Agent, each Funding Agent and each Purchaser shall have
the right to
look solely to the Servicer for performance, and (iv) the terms of
any agreement
with any Sub-Servicer shall provide that the Funding Agents may
terminate such
agreement upon the termination of the Servicer hereunder by giving
notice of its
desire to terminate such agreement to the Servicer (and the
Servicer shall
provide appropriate notice to each such Sub-Servicer).
Section 4.2.
Duties of the Servicer. (a) The Servicer shall take or
cause to be taken all such action as may be necessary or advisable
to administer
and collect each Pool Receivable from time to time, all in
accordance with this
Agreement and all applicable laws, rules and regulations, with
reasonable care
and diligence, and in accordance with the Credit and Collection
Policy. The
Servicer shall set aside, for the accounts of the Seller and the
Purchasers, the
amount of the Collections to which each is entitled in accordance
with Article
I. The Servicer may, in accordance with the Credit and Collection
Policy, extend
the maturity of any Pool Receivable (but not beyond 60 days and not
more than
once with respect to any such Pool Receivable) and extend the
maturity or adjust
the Outstanding Balance of any Defaulted Receivable as the Servicer
may
determine to be appropriate to maximize Collections thereof;
provided, however,
that: (i) such extension or adjustment shall not alter the status
of such Pool
Receivable as a Delinquent Receivable or a Defaulted Receivable or
limit the
rights of the Purchasers, the Collateral Agent or the Funding
Agents under this
Agreement and (ii) if a Termination Event has occurred and USS or
an Affiliate
thereof is serving as the Servicer, USS or such Affiliate may make
such
extension or adjustment only upon the prior written approval of the
Funding
Agents. The Seller shall deliver to the Servicer and the Servicer
shall hold for
the benefit of the Seller and the Collateral Agent (individually
and for the
benefit of the Purchasers and the Funding Agents), in accordance
with their
respective interests, all records and documents (including computer
tapes or
disks) with respect to each Pool Receivable. Notwithstanding
anything to the
contrary contained herein, the Funding Agents may direct the
Servicer (whether
the Servicer is USS or any other Person) to commence or settle any
legal action
to enforce collection of any Pool Receivable or to foreclose upon
or repossess
any Related Security; provided, however, that no such direction may
be given
unless either: (A) a Termination Event has occurred or (B) any
Funding Agent
believes in good faith that the failure to commence, settle or
effect such legal
action, foreclosure or repossession could adversely affect
Receivables
constituting a material portion of the Pool Receivables.
(b)
The Servicer shall, as
soon as practicable following actual receipt of
collected funds, turn over the collections of any indebtedness that
is not a
Pool Receivable to the Person to whom such indebtedness is owed,
less, if USS or
an Affiliate thereof is not the Servicer, all reasonable and
appropriate out-of-
pocket costs and expenses of such Servicer of servicing, collecting
and
administering such collections. The Servicer, if other than USS or
an Affiliate
thereof, shall, as soon as practicable upon demand, deliver to the
Seller all
records in its possession that evidence or relate to any
indebtedness that is
not a Pool Receivable, and copies of records in its possession that
evidence or
relate to any indebtedness that is a Pool Receivable.
(c)
The Servicer's
obligations hereunder shall terminate on the later of:
(i) the Facility Termination Date and (ii) the date on which all
amounts
required to be paid to the Purchasers, the Funding Agents, the
Collateral Agent,
and any other Indemnified Party or Affected Person hereunder shall
have been
paid in full.
After such termination, if USS or an Affiliate thereof was not the
Servicer
on the date of such termination, the Servicer shall promptly
deliver to the
Seller all books, records and related materials that the Seller
previously
provided to the Servicer, or that have been obtained by the
Servicer, in
connection with this Agreement.
Section 4.3.
Establishment and Use of Certain Accounts. (a) On or prior
to the Closing Date, the Seller shall execute and deliver to the
relevant Lock-
Box Banks and the Funding Agents the Lock-Box Letters with respect
to the Lock-
Box Accounts listed on Schedule II. The Lock-Box Accounts shall be the
only
accounts used to receive Collections with respect to the Pool
Receivables from
the related Obligors.
The Servicer shall on each day on which Collections of
Pool Receivables are received in the Lock-Box Accounts cause such
Collections to
be transferred from the Lock-Box Accounts into the Concentration
Account.
(b)
On or prior to the
Closing Date, the Seller shall have entered into a
Concentration Account Agreement with the Concentration Account Bank
and deliver
an original counterpart thereof to the Funding Agents. Any amount in the
Concentration Account may be invested by the Seller (or Servicer on
the Seller's
behalf) in Permitted Investments; provided, however, that such
investments shall
mature not later than the Settlement Date immediately succeeding
such Permitted
Investments and any such Permitted Investments shall be credited to
a securities
account (as defined in the applicable UCC) over which the
Collateral Agent for
the benefit of the Purchasers shall have a first priority perfected
Security
interest. All income
or other gain from investment of monies deposited in the
Concentration Account shall be deposited in the Concentration
Account
immediately upon receipt thereof, and any loss resulting from
Permitted
Investments shall be charged to the Concentration Account.
(c)
The Collateral Agent
has established the Collection Account which
shall be used to accept the transfer of Collections of Pool
Receivables from the
Concentration Account pursuant to Article I and for such other
purposes
described in the Transaction Documents and the Collateral Agent
with the consent
or at the direction of the Funding Agents shall have the exclusive
right to
withdraw funds therefrom. On the Closing Date, the
Collateral Agent shall
release (or authorize the bank maintaining the Collection Account
to release) to
the Seller an amount equal to $2,500,000 (plus accrued and unpaid
interest
thereon), solely to the extent such amount is on deposit in the
Collection
Account.
So
long as no Termination Event shall have occurred and be continuing,
all
or any portion of the amounts on deposit in the Collection Account
shall be
invested by the Collateral Agent at the Servicer's written
direction in one or
more Permitted Investments. All income or other gain from
investment of monies
deposited in the Collection Account shall be deposited in the
Collection Account
immediately upon receipt thereof, and any loss resulting from
Permitted
Investments shall be charged to the Collection Account.
The maximum
permissible
maturity of any Permitted Investment shall be not later than the
Settlement Date
immediately succeeding such Permitted Investment.
(d)
Upon the occurrence and during the continuation of a Termination
Event,
the Collateral Agent with the consent or at the direction of the
Funding Agents
may at any time thereafter give notice to each Lock-Box Bank, the
Concentration
Account Bank and the Collection Account Bank that the Collateral
Agent is
exercising its rights under the Lock-Box Letters, the Concentration
Account
Agreement and the Collection Account Agreement, as applicable, to
do any or all
of the following: (i) to have the exclusive ownership and control
of the
Accounts transferred to the Collateral Agent and to exercise
exclusive dominion
and control over the funds deposited therein, (ii) to have the
proceeds that are
sent to the respective Accounts redirected pursuant to the
Collateral Agent's
instructions, and (iii) to take any or all other actions permitted
under the
applicable Lock-Box Letter, the Concentration Account Agreement and
the
Collection Account Agreement, as applicable. The Seller hereby
agrees that if
the Collateral Agent at any time takes any action set forth in the
preceding
sentence, the Collateral Agent shall have exclusive control of the
proceeds
(including Collections) of all Pool Receivables and the Seller
hereby further
agrees to take any other action that the Collateral Agent or any
Funding Agent
may reasonably request to transfer such control. Any proceeds of
Pool
Receivables received by the Seller or the Servicer thereafter shall
be sent
immediately to the Collateral Agent.
Section 4.4.
Enforcement Rights.
(a) At any time following the
occurrence and during the continuation of a Termination Event:
(i) the Funding Agents
may direct the Obligors that payment of all
amounts payable under any Pool Receivable is to be made directly to
the
Collateral Agent or its designee,
(ii) the Funding Agents may give notice of the Purchaser's
interest
in Pool Receivables to each Obligor, which notice shall direct that
payments
be made directly to the Collateral Agent or its designee, and
(iii) the Collateral Agent may request the Servicer to, and upon
such
request the Servicer shall: (A) assemble all of the records
necessary or
desirable to collect the Pool Receivables and the Related Security,
and transfer
or license to a successor Servicer the use of all software
necessary or
desirable to collect the Pool Receivables and the Related Security,
and make the
same available to the Collateral Agent or its designees at a place
selected by
the Collateral Agent and (B) segregate all cash, checks and other
instruments
received by it from time to time constituting Collections in a
manner acceptable
to the Funding Agents and, promptly upon receipt, remit all such
cash, checks
and instruments, duly endorsed or with duly executed instruments of
transfer, to
the Collateral Agent or its designee.
(b)
The Seller hereby
authorizes the Collateral Agent, and irrevocably
appoints the Collateral Agent as its attorney-in-fact with full
power of
substitution and with full authority in the place and stead of the
Seller, which
appointment is coupled with an interest, to take any and all steps
in the name
of the Seller and on behalf of the Seller necessary or desirable,
in the
determination of the Collateral Agent, with the consent or at the
direction of
the Funding Agents, after the occurrence and during the
continuation of a
Termination Event, to collect any and all amounts or portions
thereof due under
any and all Pool Assets, including endorsing the name of the Seller
on checks
and other instruments representing Collections and enforcing such
Pool Assets.
Notwithstanding anything to the contrary contained in this
subsection, none of
the powers conferred upon such attorney-in-fact pursuant to the
preceding
sentence shall subject such attorney-in-fact to any liability if
any action
taken by it shall prove to be inadequate or invalid, nor shall they
confer any
obligations upon such attorney-in-fact in any manner
whatsoever.
Section 4.5.
Responsibilities of the Seller. (a) Anything herein to the
contrary notwithstanding, the Seller shall pay when due any taxes,
including any
sales taxes payable in connection with the Pool Receivables and
their creation
and satisfaction. None
of the Collateral Agent, Funding Agents or any Purchaser
shall have any obligation or liability with respect to any Pool
Asset, nor shall
any of them be obligated to perform any of the obligations of the
Seller or
Servicer.
(b)
USS hereby agrees that if at any time it shall cease to be the
Servicer
hereunder, it shall act (if the then-current Servicer so requests)
as the data-
processing agent of the Servicer and, in such capacity, USS shall
conduct the
data-processing functions of the administration of the Receivables
and the
Collections thereon in substantially the same way that USS
conducted such data-
processing functions while it acted as the Servicer.
Section 4.6. Servicing
Fee. (a) Subject to
clause (b), the Servicer shall
be paid a fee (the "Servicing Fee") equal to 1.0% per annum of the
daily average
Outstanding Balance of the Pool Receivables. The Purchasers' share of such
fee
shall be paid through the distributions contemplated by Sections
1.4 and 1.5,
and the Seller's share of such fee shall be paid by the Seller.
(b)
If the Servicer ceases
to be USS or an Affiliate thereof, the
successor Servicer shall be paid a fee in the amount specified by
such successor
Servicer not to exceed 110% of the aggregate reasonable costs and
expenses
incurred by such successor Servicer in connection with the
performance of its
obligations as Servicer. The Purchasers' share of such fee
shall be paid
through the distributions contemplated by Sections 1.4 and 1.5, and
the Seller's
share of such fee shall be paid by the Seller.
ARTICLE V.
THE AGENTS
SECTION 5.1.
Appointment and Authorization. (a) Each Purchaser and
Funding Agent (including each Purchaser and Funding Agent that may
from time
to time become a party hereto) hereby irrevocably designates and
appoints BNS
as the "Collateral Agent" hereunder and authorizes the Collateral
Agent to take
such actions and to exercise such powers as are delegated to the
Collateral
Agent hereby and to exercise such other powers as are reasonably
incidental
thereto, including the execution and delivery on the date hereof by
the
Collateral Agent (on behalf of such Purchaser and/or Funding Agent)
of the
Intercreditor Agreement, and taking all such action by it
thereunder for the
benefit of the Purchasers and Funding Agents pursuant to the terms
thereof.
The Collateral Agent shall hold, in its name, for the benefit of
each Purchaser,
ratably, the Purchased Interest. The Collateral Agent shall not
have any duties
other than those expressly set forth herein or any fiduciary
relationship with
any Purchaser or Funding Agent, and no implied obligations or
liabilities shall
be read into this Agreement, any other Transaction Document or the
Intercreditor
Agreement, or ot
