EXHIBIT 10.1
PAYOFF AND TERMINATION AGREEMENT
PAYOFF AND TERMINATION AGREEMENT (this "Agreement"), dated as of July
8, 2005, among:
(1) BON-TON RECEIVABLES MASTER NOTE TRUST, a Delaware statutory trust
(the "Issuer");
(2) THE BON-TON RECEIVABLES PARTNERSHIP, L.P., a Pennsylvania limited
partnership (the "Transferor");
(3) THE BON-TON OPERATIONS, INC., a Pennsylvania corporation ("Bon-Ton
Operations"), as servicer (in such capacity, the "Servicer") and as
administrator (in such capacity, the "Administrator");
(4) THE BON-TON DEPARTMENT STORES, INC., a Pennsylvania corporation
("Bon-Ton DSI") and THE ELDER-BEERMAN STORES CORP., an Ohio corporation
("Elder-Beerman") (each a "Seller" and collectively, the "Sellers")
(5) THE BON-TON STORES, INC., a Pennsylvania corporation ("Stores")
and THE BON-TON CORP., a Delaware corporation ("Bon-Ton" and together with
the Transferor, the Servicer, the Sellers and Stores, the "Bon-Ton
Parties");
(6) FALCON ASSET SECURITIZATION CORPORATION ("Falcon") and CHARTA, LLC
("Charta") (each a "Conduit Purchaser" and collectively, the "Conduit
Purchasers");
(7) JPMORGAN CHASE BANK, N.A. ("JPMorgan Chase") and CITIBANK, N.A.
("Citibank") (each a "Committed Purchaser" and collectively, the Committed
Purchasers");
(8) JPMORGAN CHASE and CITICORP NORTH AMERICA, INC. ("CNAI") (each a
"Managing Agent" and collectively, the "Managing Agents");
(9) JPMORGAN CHASE, as "Class A Agent" for the Purchasers (in such
capacity the "Class A Agent");
(10) WILMINGTON TRUST COMPANY, as owner trustee (in such capacity, the
"Owner Trustee"); and
(11) WACHOVIA BANK, N.A., as indenture trustee (in such capacity, the
"Indenture Trustee").
PRELIMINARY STATEMENTS
(A) The Sellers and the Transferor are parties to a Receivables
Purchase Agreement, dated as of January 30, 2004 (as amended, restated, modified
and supplemented to the date hereof, the "Receivables Purchase Agreement")
pursuant to which the Transferor agreed to purchase from the Sellers, certain
Receivables and related property.
(B) The Transferor, the Servicer, the Indenture Trustee and the Issuer
are parties to that certain Transfer and Servicing Agreement dated as of January
30, 2004 (as amended, restated, modified and supplemented to the date hereof,
the "Transfer and Servicing Agreement") pursuant to which the Issuer has agreed
to purchase the Receivables and related property from the Transferor.
(C) The Issuer and the Indenture Trustee are parties to that certain
Master Indenture dated as of January 30, 2004 (as amended, restated, modified
and supplemented to the date hereof, the "Indenture"). Capitalized terms used
herein but not defined herein shall have the meanings given to such terms in the
Indenture, or, if not defined therein, in the Transfer and Servicing Agreement,
the 2004-1 Supplement or the Note Purchase Agreement.
(D) The Indenture has been supplemented by that certain Series 2004-1
Indenture Supplement dated as of January 30, 2004 (as amended, restated,
modified and supplemented to the date hereof, the "2004-1 Supplement"), between
the Issuer and the Indenture Trustee.
(E) CNAI and JPMorgan Chase are the holders of the Class A Series
2004-1 Floating Rate Asset Backed Variable Funding Notes (each, a "2004-1 Note"
and collectively, the "2004-1 Notes"), which Series 2004-1 Notes were issued
pursuant to the terms of the 2004-1 Supplement and that certain Note Purchase
Agreement (as amended, restated, modified and supplemented to the date hereof,
the "Note Purchase Agreement") dated as of January 30, 2004 among the
Transferor, the Servicer, the Conduit Purchasers, the Committed Purchasers, the
Managing Agents and the Class A Agent.
(F) The 2004-1 Notes are the only issued and outstanding Notes as of
the date hereof.
(G) The Transferor and the Owner Trustee are parties to that certain
Trust Agreement dated as of January 30, 2004 (as amended, restated, modified and
supplemented to the date hereof, the "Trust Agreement") pursuant to which the
Issuer issued the Transferor Certificate and the Ownership Interest Certificate
to the Transferor.
(H) The Issuer and Bon-Ton Operations are parties to that certain
Administration Agreement dated as of January 30, 2004 (as amended, restated,
modified and supplemented to the date hereof, the "Administration Agreement")
pursuant to which the Administrator agreed to provide certain administrative
services to the Issuer and Owner Trustee.
(I) Stores and Bon-Ton are parties to that certain Performance
Undertaking dated as of January 30, 2004 (as amended, restated, modified and
supplemented to the date hereof, the "Performance Undertaking") pursuant to
which the Performance Guarantors
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guaranteed the due and punctual performance of certain obligations of the
Sellers and Bon-Ton Operations.
(J) On the terms and subject to the conditions set forth herein, the
Issuer and the Bon-Ton Parties desire to terminate the Receivables Purchase
Agreement, the Transfer and Servicing Agreement, the Indenture, the 2004-1
Supplement, the Note Purchase Agreement, 2004-1 Notes, the Trust Agreement, the
Administration Agreement, the Performance Undertaking, the Fee Letters, the
Transferor Certificate, the Ownership Interest Certificate, each of the other
Transaction Documents and all other instruments, documents and agreements
executed in connection with the foregoing (collectively, the "Master Note Trust
Documents") and, on the terms and subject to the conditions herein, Falcon,
Charta, CNAI, Citibank, JPMorgan Chase, the Owner Trustee and the Indenture
Trustee are agreeable to such termination.
NOW THEREFORE, it is hereby agreed by and among the parties hereto as
follows:
SECTION 1. Payout Amounts. Each of the Indenture Trustee, the Owner
Trustee, CNAI, JPMorgan Chase, Charta and Falcon hereby confirms that the
aggregate amount owed to it under the Master Note Trust Documents, if paid on or
before July 8, 2005 (the "Payout Date") in immediately available funds or in
such other manner as such Person may direct in writing, will be the amount set
forth opposite such Person's name on Exhibit I hereto (such amount being
hereinafter referred to as such Person's "Payout Amount"). The Payoff Amount
shall be sent by the Issuer to the Indenture Trustee, the Owner Trustee and each
Managing Agent (for the account of the Purchasers in the related Purchase
Group), directly or through the Indenture Trustee by wire or intrabank transfer
of immediately available funds directed as set forth on Exhibit II hereto, or as
otherwise agreed between the applicable Persons. The Payout Amount for each such
Person includes, without limitation, all fees, expenses and other amounts
payable to it under the Master Note Trust Documents, and each of the Indenture
Trustee, the Owner Trustee, CNAI, JPMorgan Chase, Charta and Falcon hereby
confirms that payment in full of its Payout Amount as described above will not
cause any prepayment penalty or other charge under the Master Note Trust
Documents which is not already included in such Payout Amount. Upon receiving
written confirmation that the Payout Amount owed to each of the Indenture
Trustee, the Owner Trustee, CNAI, JPMorgan Chase, Charta and Falcon has been
paid in full on the Payout Date, the Servicer is hereby authorized and directed
to apply all amounts on deposit in the Concentration Account, the Special
Funding Account and the Series Account as the Transferor may direct in writing.
The Servicer hereby acknowledges and agrees that, as of the Payout Date, it has
been paid in full all amounts owing to it under the Master Note Trust Documents.
SECTION 2. Termination of Master Note Trust Documents. Each of the
parties hereto acknowledges and agrees that upon payment in full of all Payout
Amounts owed to the Indenture Trustee, the Owner Trustee, CNAI, JPMorgan Chase,
Citibank, Charta and Falcon, respectively, on the Payout Date as described in
Section 1 above:
(a) each of the Master Note Trust Documents will terminate and none of
the Issuer, the Bon-Ton Parties, the Indenture Trustee, the Owner Trustee, CNAI,
JPMorgan Chase, Citibank, Charta or Falcon shall have any further obligations,
liabilities, duties or responsibilities
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thereunder, except for any obligations that are expressly stated by their terms
to survive termination of such Master Note Trust Documents, and, without
limiting the generality of any of the foregoing, the Indenture Trustee and the
Owner Trustee shall be deemed to have properly satisfied all of their respective
obligations under the Master Note Trust Documents prior to and as of the date
hereof;
(b) all ownership interests, security interests, liens, and other
encumbrances (collectively, "Liens") granted to, or otherwise existing in favor
of, the Indenture Trustee, the Owner Trustee, CNAI, JPMorgan Chase, Citibank,
Charta or Falcon under or in connection with the Master Note Trust Documents in
respect of the Collateral and any other assets or interests in property of the
Issuer or the Bon-Ton Parties shall be automatically released, and all of the
right, title and interest of the Indenture Trustee, the Owner Trustee, CNAI,
JPMorgan Chase, Citibank, Charta and Falcon in and to such Collateral and other
assets or interests in property shall be automatically transferred and assigned,
without recourse and without representation or warranty of any kind, to the
Issuer, other than a representation and warranty by each such Person that all of
its right, title and interest in and to such Collateral and other assets and
interests in property of the Issuer have been transferred to the Issuer free and
clear of any Liens created by or arising through such Person;
(c) each of CNAI and JPMorgan Chase shall surrender their 2004-1 Notes
to the Indenture Trustee for cancellation;
(d) the Trust Termination Date shall be deemed to occur, the Owner
Trustee shall distribute any money or other property held as part of the Trust
Estate to the Transferor or as directed by the Transferor in accordance with
Section 8.01 of the Trust Agreement and the Transferor and the Owner Trustee
shall take all necessary action to cause the termination of the Trust in the
manner described in Section 8.01 of the Trust Agreement; and
(e) all amounts remaining on deposit in the Collection Account, the
Special Funding Account, any Series Account or any other account established in
the name of, or otherwise subject to the direction and control of, the Indenture
Trustee for the benefit of the Noteholders (collectively, the "Trust Accounts")
shall be forthwith remitted to the Transferor or as the Transferor may otherwise
direct in writing.
SECTION 3. Further Assurances. Upon payment in full of all Payout
Amounts on the Payout Date as described in Section 1 above, each of the
Indenture Trustee, the Owner Trustee, CNAI, JPMorgan Chase, Citibank, Charta and
Falcon agrees that it shall (at the Transferor's expense) execute and deliver
all further instruments and documents and take all further actions as the
Transferor may reasonably request in order to further evidence the termination,
release and assignment described in Section 2 above. Without limiting the
generality of the foregoing, the Indenture Trustee hereby agrees that upon such
payment it shall (at the Transferor's expense) authorize, execute and/or
deliver:
(a) such UCC-3 termination statements as may be reasonably requested
and prepared by the Transferor to evidence the release described in Section 2
above; and
(b) a letter prepared by the Transferor and addressed to each bank at
which a Trust Account is maintained, notifying such bank of the termination of
the Master Note Trust Documents and transferring to the Transferor (or such
other Person as the Transferor may direct
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in writing) all of the Indenture Trustee's right, title and interest in and to
each such Trust Account and the amounts on deposit therein.
In anticipation of the payment of the Payout Amounts as described
above, the Indenture Trustee is hereby authorized and directed by each of the
other parties hereto to deliver the instruments and documents referred to in
items (a) and (b) above to Sidley Austin Brown & Wood LLP, to be held in escrow
until such time as the Indenture Trustee has received written confirmation of
the making of such payment.
SECTION 4. Waiver of Conditions. By execution hereof, each party
hereto waives compliance with any conditions precedent or other requirements set
forth in the Master Note Trust Documents in connection with the payoff and
termination contemplated hereby.
SECTION 5. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE
TO ITS CONFLICT OF LAW PROVISIONS.
SECTION 6. Counterparts; Severability. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute one and the same
instrument. Delivery of an executed counterpart of this Agreement by facsimile
shall be effective as delivery of a manually executed counterpart of this
Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforeceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
FALCON ASSET SECURITIZATION
CORPORATION, as a Conduit Purchaser
By: /s/ Brian Zimmer
--------------------------------------
Name: Brian Zimmer
Title: Authorized signer
JPMORGAN CHASE BANK, N.A.,
as a Committed Purchaser, a Managing Agent
and as Class A Agent
By: /s/ Brian Zimmer
--------------------------------------
Name: Brian Zimmer
Title: Vice President
CHARTA, LLC, as a Conduit Purchaser
By: Citicorp North America, Inc.,
its attorney-in-fact
By: /s/ Kimberly A. Conyngham
--------------------------------------
Name: Kimberly A. Conyngham
Title: Vice President
CITIBANK, N.A.,
as a Committed Purchaser
By: /s/ Kimberly A. Conyngham
--------------------------------------
Name: Kimberly A. Conyngham
Title: Vice President
CITICORP NORTH AMERICA, INC.,
as a Managing Agent
By: /s/ Kimberly A. Conygham
--------------------------------------
Name: Kimberly A. Conygham
Title: Vice President
BON-TON RECEIVABLES MASTER
NOTE TRUST, as Issuer
By: Wilmington Trust Company,
not in its individual capacity
but solely as Indenture Trustee
By: /s/ Erwin M Soriano
--------------------------------------
Name: Erwin M. Soriano
Title: Assistant Vice President
WILMINGTON TRUST COMPANY,
as Owner Trustee
By: /s/ Erwin M. Soriano
--------------------------------------
Name: Erwin M. Soriano
Title: Assistant Vice President
THE BON-TON RECEIVABLES
PARTNERSHIP, L.P., as Transferor
By: /s/ H. Todd Dissinger
--------------------------------------
Name: H. Todd Dissinger
Title: Vice President and Treasurer
THE BON-TON OPERATIONS, INC.,
as Servicer and as Administrator
By: /s/ H. Todd Dissinger
--------------------------------------
Name: H. Todd Dissinger
Title: Vice President and Treasurer
THE BON-TON DEPARTMENT STORES, INC.,
as a Seller
By: /s/ H. Todd Dissinger
--------------------------------------
Name: H. Todd Dissinger
Title: Vice President and Treasurer
THE ELDER-BEERMAN STORES CORP.,
as a Seller
By: /s/ H. Todd Dissinger
--------------------------------------
Name: H. Todd Dissinger
Title: Vice President and Treasurer
THE BON-TON STORES, INC.,
as Performance Guarantor
By: /s/ H. Todd Dissinger
--------------------------------------
Name: H. Todd Dissinger
Title: Vice President and Treasurer
THE BON-TON CORP.,
as Performance Guarantor
By: /s/ Keith E. Plowman
--------------------------------------
Name: Keith E. Plowman
Title: Treasurer
WACHOVIA BANK, N.A.,
not in its individual capacity but solely
as Indenture Trustee
By: /s/ Patricia O'Neill-Manella
--------------------------------------
Name: Patricia O'Neill-Manella
Title: Vice President