EXHIBIT 4.8
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CERTIFICATE PURCHASE AGREEMENT
(SERIES 1996-1, CLASS A)
dated as of May 29, 1996
among
NOTEPAD FUNDING CORPORATION,
AMERICAN PAD & PAPER COMPANY OF DELAWARE, INC.,
THE PURCHASERS DESCRIBED HEREIN,
and
ABN AMRO BANK N.V.,
as Agent
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TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS
SECTION 1.1 Definitions....................................... 1
ARTICLE 2 PURCHASE AND SALE OF CERTIFICATES
SECTION 2.1 The Commitments; Percentages...................... 2
SECTION 2.2 Purchase Mechanics................................ 2
SECTION 2.3 Reduction of Stated Amounts....................... 4
SECTION 2.4 Certificates...................................... 4
ARTICLE 3 REDUCTIONS IN INVESTED AMOUNT
SECTION 3.1 Transferor's Right to Reduce Invested Amount...... 5
SECTION 3.2 Notice to Purchasers.............................. 5
ARTICLE 4 TRANCHES, INTEREST AND FEES
SECTION 4.1 Tranches.......................................... 5
SECTION 4.2 Fees.............................................. 6
SECTION 4.3 Yield Protection.................................. 7
SECTION 4.4 Illegality; Unavailability........................ 9
SECTION 4.5 Indemnity......................................... 10
SECTION 4.6 Taxes............................................. 10
ARTICLE 5 OTHER PAYMENT TERMS
SECTION 5.1 Time and Method of Payment........................ 11
SECTION 5.2 Pro Rata Treatment................................ 12
ARTICLE 6 REPRESENTATIONS AND WARRANTIES
SECTION 6.1 Transferor........................................ 12
SECTION 6.2 APP............................................... 13
SECTION 6.3 Purchasers........................................ 14
ARTICLE 7 CONDITIONS
SECTION 7.1 Conditions to Initial Purchase.................... 14
SECTION 7.2 Conditions to Each Purchase....................... 18
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ARTICLE 8 COVENANTS
SECTION 8.1 Covenants .......................................... 18
ARTICLE 9 AGENT
SECTION 9.1 Appointment ........................................ 20
SECTION 9.2 Nature of Duties ................................... 20
SECTION 9.3 Lack of Reliance on Agent and Financial Advisor .... 20
SECTION 9.4 Certain Rights of Agent ............................ 21
SECTION 9.5 Reliance ........................................... 21
SECTION 9.6 Indemnification .................................... 21
SECTION 9.7 Agent in its Individual Capacity ................... 22
SECTION 9.8 Resignation by Agent ............................... 22
ARTICLE 10 MISCELLANEOUS PROVISIONS
SECTION 10.1 Amendments ......................................... 23
SECTION 10.2 No Waiver; Remedies ................................ 23
SECTION 10.3 Successors and Assigns; Assignments ................ 23
SECTION 10.4 Survival of Agreement .............................. 26
SECTION 10.5 Expenses; Indemnification .......................... 26
SECTION 10.6 Entire Agreement ................................... 28
SECTION 10.7 Notices ............................................ 28
SECTION 10.8 No Third Party Beneficiaries ....................... 28
SECTION 10.9 Severability of Provisions ......................... 28
SECTION 10.10 Counterparts ....................................... 28
SECTION 10.11 Governing Law ...................................... 29
SECTION 10.12 Tax Characterization ............................... 29
SECTION 10.13 No Proceedings ..................................... 29
SECTION 10.14 Reference Banks .................................... 29
SECTION 10.15 No Recourse ........................................ 29
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SCHEDULE I Stated Amounts and Percentages
EXHIBITS
EXHIBIT A Form of Pooling and Servicing Agreement
EXHIBIT B Form of Receivables Purchase Agreement
EXHIBIT C Form of Series 1996-1 Supplement
EXHIBIT D Form of Assignment Agreement
APPENDIX
APPENDIX X Index of Additional Defined Terms
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This CERTIFICATE PURCHASE AGREEMENT, dated as of May 29, 1996 (this
"Agreement"), is made among NOTEPAD FUNDING CORPORATION, a Delaware corporation
("Transferor"), AMERICAN PAD & PAPER COMPANY OF DELAWARE, INC., a Delaware
corporation ("Servicer" or "APP"), the purchasers named on the signatures pages
of this Agreement (together with their respective permitted assigns, the
"Purchasers"), and ABN AMRO BANK N.V. ("Agent").
BACKGROUND
1. Transferor (a) is party to an Amended and Restated Pooling and
Servicing Agreement substantially in the form of Exhibit A (the "Pooling
Agreement") with APP, as initial Servicer, and MANUFACTURERS AND TRADERS TRUST
COMPANY, a New York banking corporation, as trustee (in that capacity, together
with any successors in that capacity, the "Trustee"), (b) is party to an Amended
and Restated Receivables Purchase Agreement substantially in the form of Exhibit
B and (c) will enter into a Series 1996-1 Supplement to the Pooling Agreement
substantially in the form of Exhibit C (the "Supplement"). Pursuant to the
Pooling Agreement and the Supplement, Transferor will obtain the Series 1996-1,
Class A Certificates (the "Certificates"), which will represent fractional
undivided beneficial interests in the assets of the Notepad Funding Receivables
Master Trust (the "Trust"), a trust organized pursuant to the Pooling Agreement.
2. Transferor wishes to sell the Certificates to the Purchasers and
obtain their commitment to purchase fractional undivided beneficial interests in
the assets of the Trust (each a "Trust Interest") that will be evidenced by the
Certificates. Subject to the terms and conditions of this Agreement, each
Purchaser is willing (a) to purchase a Certificate with an initial Stated Amount
in the amount set forth below its name on the signature pages to this Agreement
and (b) to agree to make purchases of Trust Interests. APP has joined in this
Agreement to confirm certain representations, warranties and covenants for the
benefit of the Purchasers and the Agent.
ARTICLE 1 DEFINITIONS
SECTION 1.1 Definitions. Capitalized terms used and not otherwise defined
herein have the meanings assigned to them in the Supplement or, if not defined
in the Supplement, in Appendix A to the Pooling Agreement. An index of terms
defined directly in this Agreement is attached as Appendix X.
ARTICLE 2 PURCHASE AND SALE OF CERTIFICATES
SECTION 2.1 The Commitments; Percentages. Subject to the terms and
conditions of this Agreement, the Pooling Agreement and the Supplement, each
Purchaser agrees, severally and for itself alone, upon Transferor's request
(through Servicer), to make purchases (each a "Purchase") of Trust Interests
from time to time during the Revolving Period for the Series 1996-1
Certificates; provided, that no Purchaser will be required or permitted to make
a Purchase on any date if the funded principal amount of its Certificate, after
giving effect to the Purchase, would exceed the lesser of (a) the Stated Amount
of its Certificate and (b) its Class Percentage multiplied by the Class A
Invested Amount. In addition, no Purchaser will be required or permitted to make
a Purchase if, after giving effect thereto (and any corresponding reduction to
the Series Invested Amount pursuant to Section 3.1), the Net Invested Amount
would exceed the Base Amount. The Purchases by the Purchasers shall be made
ratably in accordance with their respective Class Percentages; provided, that
the failure of any Purchaser to make any Purchase shall not relieve any other
Purchaser of its obligation to make Purchases hereunder. No Purchaser shall,
however, be responsible for the failure of any other Purchaser to make any
Purchase. Subject to the terms of this Agreement, the aggregate principal amount
of a Purchaser's investment represented by its Certificate may be increased or
decreased from time to time.
For purposes of this Agreement, (i) "Class Percentage" means, with respect
to each Purchaser, the percentage equivalent (carried out to twelve decimal
places) of a fraction, the numerator of which is the Stated Amount of such
Purchaser's Certificate and the denominator of which is the sum of the Stated
Amounts of all of the Purchasers' Certificates, and (ii) "Series Percentage"
means, with respect to each Purchaser, the percentage equivalent (carried out to
twelve decimal places) of a fraction, the numerator of which is the Stated
Amount of such Purchaser's Certificate and the denominator of which is the sum
of the Stated Amounts for all of the Series 1996-1 Certificates. The initial
Class Percentages and Series Percentages of the initial Purchasers are set forth
opposite their names in Schedule I.
SECTION 2.2 Purchase Mechanics. (a) Whenever Transferor wishes the
Purchasers to make Purchases, it shall cause Servicer to notify the Agent if the
Trust Interests to be purchased initially will form a part of (i) the ABR
Tranche, not later than 10:00 a.m., New York City time, one Business Day prior
to the date of the proposed Purchase and (ii) a Eurodollar Tranche, not later
than 10:00 a.m., New York City time, three Business Days prior to the date of
the proposed Purchase. Each notice shall be irrevocable and shall in each case
refer to this Agreement and specify (w) the aggregate purchase price
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for the requested Purchases (which shall be in a minimum amount of $5,000,000 or
a greater integral multiple of $1,000,000 (or in the total unutilized amount of
the various Purchasers' Stated Amounts)), (x) whether the Trust Interests to be
purchased will form a part of the ABR Tranche or a Eurodollar Tranche, (y) in
the case of Trust Interests forming a Eurodollar Tranche, the length of the
related Interest Period and (z) the date of the Purchase (which shall be a
Business Day) and the amount thereof. If no election required by clause (y) is
made in any notice, then the Trust Interests obtained in the Purchase shall form
a part of the ABR Tranche. The Agent shall promptly advise the Purchasers of any
notice given pursuant to this section and of the amount of each Purchaser's
respective Purchase amount.
(b) After receiving notice from the Agent of any notice given pursuant to
subsection (a) and subject to the conditions in Article VII, each Purchaser
shall make a Purchase in the amount of its pro rata portion of aggregate
Purchases requested to be made, ratably according to its Class Percentage, on
the proposed date thereof by wire transfer in Dollars of immediately available
funds to the Agent at the office designated from time to time by the Agent, not
later than 10:00 a. m., New York City time, and the Agent shall (unless notified
in writing that any condition precedent has not been satisfied), by noon, New
York City time, on the same day, make available to Transferor by wire transfer
of Dollars in immediately available funds the aggregate amount of the funds
received. Unless the Agent shall have received written notice from a Purchaser
prior to the date of any Purchase that the Purchaser will not make available to
the Agent its purchase price, the Agent may (but shall not be required to)
assume that the Purchaser has made that portion available to the Agent on the
date of the Purchase in accordance with this subsection, and the Agent may, in
reliance upon that assumption, make available to Transferor on that date a
corresponding amount.
(c) If and to the extent that any Purchaser shall not have made its
purchase price available to the Agent and the Agent has made available a
corresponding amount to Transferor, such Purchaser agrees to repay to the Agent
forthwith on demand a corresponding amount, together with interest thereon, for
each day from the date the amount is made available to Transferor until the date
the amount is repaid to the Agent (i) for the first three days following the
date the amount is made available, at a rate per annum equal to the Federal
Funds Rate and (ii) thereafter, at a rate per annum equal to the Federal Funds
Rate plus 1%. If such Purchaser shall repay to the Agent a corresponding amount,
the amount shall constitute its Purchase for purposes of this Agreement, and if
Transferor shall have already made the repayment (as provided below), such
Purchaser shall make a corresponding amount immediately available to Transferor.
At any time after the Agent learns that a
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Purchaser has failed to make the purchase price for a Purchase available as
described above, the Agent may give notice to Transferor and Servicer of that
failure, and upon notice Transferor will be required to refund to the Agent an
amount equal to that purchase price, together with interest on the amount at the
rate applicable to the Purchase of which the defaulting Purchaser's Purchase was
to form a part. Nothing contained in this subsection shall, or shall be
construed to, relieve any Purchaser from its obligations hereunder to make
available to the Agent its purchase price for each Purchase.
SECTION 2.3 Reduction of Stated Amounts. Upon at least three Business Days'
prior irrevocable notice to the Agent in writing, Transferor may reduce the
Stated Amounts of the Certificates; provided that (a) each partial reduction of
the Stated Amounts shall be, in the aggregate for all Certificates, in an
integral multiple of $1,000,000 and in a minimum principal amount of $5,000,000
and (b) no partial reduction shall be made that would reduce the aggregate
Stated Amounts to an amount less than the Class A Invested Amount at the time of
the reduction. Each reduction in the Stated Amounts shall be made ratably among
the Purchasers in accordance with their respective Stated Amounts. The Agent
shall promptly advise the Purchasers of any notice given pursuant to this
section. Each reference in this Agreement to the "Stated Amount" of a
Certificate means the Stated Amount of the Certificate after giving effect to
any reductions made pursuant to this section.
SECTION 2.4 Certificates. The outstanding amounts of the Purchases made by
each Purchaser shall be evidenced by its Certificate, to be issued on the
Closing Date substantially in the form of Exhibit A (Part 1) to the Supplement.
Each Purchaser shall and is hereby authorized to record on the grid attached to
its Certificate (or at its option, in its internal books and records) the date
and amount of each Purchase made by it, the amount of each repayment of the
principal amount represented by its Certificate, the portions of its Purchases
that are from time to time allocated to the ABR Tranche and any Eurodollar
Tranche, and any reductions to the Stated Amount of its Certificate made
pursuant to Section 2.3 (which shall be conclusive absent manifest error);
provided, that failure to make any recordation on the grid or records or any
error in the grid or records shall not adversely affect the Purchaser's rights
with respect to its interest in the assets of the Trust and its right to receive
interest in respect of the outstanding principal amount of all Purchases made by
the Purchaser.
ARTICLE 3 REDUCTIONS IN INVESTED AMOUNT
SECTION 3.1 Transferor's Right to Reduce Invested Amount. Transferor may,
on at least one Business Day's prior notice by Transferor or
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Servicer to the Agent, reduce the Class A Invested Amount by causing an amount
of funds equal to the desired amount of the reduction (plus breakage costs, if
any, payable under Section 4.5 due to such reduction) that are available for
this purpose in accordance with the terms of the Supplement to be transferred to
the Agent, for the account of the Purchasers (and application to the respective
and ratable reduction of the funded principal amount of the Certificate of each
Purchaser), provided that any reduction to the aggregate funded principal
amounts represented by the Certificates must be in a minimum amount of
$5,000,000 (or the entire funded principal amount, if less) or a greater
integral multiple of $1,000,000.
SECTION 3.2 Notice to Purchasers. The Agent shall promptly advise the
Purchasers of any notice received by the Agent pursuant to Section 3.1.
ARTICLE 4 TRANCHES, INTEREST AND FEES
SECTION 4.1 Tranches. (a) Each time Transferor requests the Purchasers to
make Purchases hereunder, Transferor will notify the Agent in writing as to
whether the Trust Interests included in the Purchase shall, in whole or in part,
be deemed part of the ABR Tranche or (subject to subsections (b)(iii) and
(b)(iv) below) a Eurodollar Tranche.
(b) Subject to the terms and conditions set forth in this section and
Section 4.4, Transferor shall have the option: (x) on any Business Day, to
convert all or part of the ABR Tranche to a Eurodollar Tranche and (y) on the
last day of any Interest Period of a Eurodollar Tranche, to convert all or any
part of that Eurodollar Tranche to form a part of the ABR Tranche and/or to
continue all or any part of that Eurodollar Tranche as a new Eurodollar Tranche,
the Interest Period for which shall commence on the last day of the prior
Interest Period; provided, that:
(i) each conversion or continuation shall be made ratably among the
Purchasers in accordance with their respective amounts of the Purchases
comprising the converted or continued Tranche,
(ii) if less than all of the outstanding amount of any Tranche shall
be converted or continued, the aggregate amount of the Tranche converted or
continued shall be in an integral multiple of $1,000,000 and in a minimum
principal amount of $2,000,000,
(iii) no outstanding Eurodollar Tranche may be continued as a
Eurodollar Tranche, and no portion of the ABR Tranche may be converted into
a Eurodollar Tranche, at any time that an Early
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Amortization Event has occurred and is continuing; and any Interest Period
for a Eurodollar Tranche that commences after the commencement of the
Amortization Period must begin on a Distribution Date and end on the day
preceding the next Distribution Date, and
(iv) there shall not be more than four separate Eurodollar Tranches
for the Certificates outstanding at any one time.
(c) If Transferor wishes to convert and/or continue a Tranche under this
section, Transferor shall notify the Agent in writing (i) in the case of a
conversion to or continuation of a Eurodollar Tranche, not later than 10:00
a.m., New York City time, three Business Days prior to the date of the proposed
conversion or continuation date and (ii) otherwise, not later than 10:00 a.m.,
New York City time, one Business Day prior to the date of the proposed
conversion or continuation. Each notice shall be irrevocable and shall refer to
this Agreement and specify (x) the identity and amount of the Tranche that
Transferor wishes to convert or continue, (y) whether all or part of the Tranche
is to be converted into or continued as a Eurodollar Tranche (and if so, the
length of the related Interest Period) and (z) the date of the proposed
conversion or continuation (which shall be a Business Day). If Transferor shall
not have delivered a timely notice in accordance with this section with respect
to any Tranche, the Tranche shall, at the end of the Interest Period applicable
to it (unless repaid pursuant to the terms hereof), automatically be converted
into or continued as the ABR Tranche. The Agent shall promptly advise the
Purchasers of any notice given pursuant to this section and of each Purchaser's
portion of any converted or continued Tranche.
(d) In accordance with Section 4.1 of the Supplement, each Purchaser and
the Agent will be entitled to receive interest as stated therein and additional
interest (at the rate specified therein) on amounts that are not paid when due
under this Agreement or under its Certificate.
SECTION 4.2 Fees. (a) Each Purchaser shall be entitled to receive from
Collections a fee (a "Non-Usage Fee") for the period from and including the date
hereof, until the end of the Revolving Period, equal to 0.25% on the daily
average of (i) the Stated Amount of its Certificate minus (ii) the amount
represented by the Purchaser's Class Percentage of the Class A Invested Amount.
The Non-Usage Fee shall be payable in arrears on each Distribution Date.
The Non-Usage Fee for any Distribution Date shall be calculated on the basis of
the actual number of days elapsed since the preceding Distribution Date (or, if
prior to the first subsequent Distribution Date after the date
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hereof, during the period from the date hereof to such Distribution Date) over a
year of 365 or 366 days, as applicable.
(b) The Agent shall be entitled to receive from Collections such fees as
are described in the letter, of even date herewith, between the Agent,
Transferor and APP.
SECTION 4.3 Yield Protection. (a) Notwithstanding any other provision
herein, if, after the date hereof, either:
(i) any law, rule or regulation (including any imposition or increase
of reserve requirements) or any interpretation or administration of any
law, rule or regulation by any Governmental Authority, central bank or
comparable agency charged with the interpretation or administration
thereof, or
(ii) the compliance by a Purchaser with any guideline or request from
any central bank or other Governmental Authority or quasi-governmental
authority exercising control over banks or financial institutions generally
(whether or not having the force of law),
shall subject a Purchaser to the imposition or modification of any reserve
(including any imposed by the Federal Reserve Board), special deposit or similar
requirement (including a reserve, special deposit or similar requirement that
takes the form of a tax) against assets of, deposits with or for the account of,
or credit extended by, that Purchaser or the office from time to time that it
designates to the Agent as the office through which it makes and maintains its
Purchases comprising part of a Eurodollar Tranche (as to each Purchaser, its
"LIBOR Office") or impose any other condition on a Purchaser affecting its
Eurodollar Tranches or its obligations hereunder, and as a result of either of
the foregoing there shall be any increase in the cost to that Purchaser of
agreeing to make or making, funding or maintaining Purchases as Eurodollar
Tranches, or there shall be a reduction in the amount received or receivable by
any Purchaser or its LIBOR Office, then, upon written notice from that Purchaser
to Transferor and Servicer (with a copy to the Agent), signed by an officer of
such Purchaser with knowledge of and responsibility for such matters, and
setting forth in reasonable detail the calculation used to arrive at the
amounts, additional amounts sufficient to indemnify that Purchaser on an after-
tax basis against the increased cost or reduction in amounts received or
receivable shall constitute "Additional Amounts" for purposes of the Supplement,
and that Purchaser shall be entitled to receive these additional amounts, solely
from amounts allocated thereto and paid pursuant to the Supplement.
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(b) If a Purchaser shall reasonably determine that the adoption after the
date hereof of any law, rule or regulation regarding capital adequacy or capital
maintenance, or any change after the date hereof in any of the foregoing or in
the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by that Purchaser, any of its lending
offices or its holding company with any new or revised request or directive
regarding capital adequacy or capital maintenance (whether or not having the
force of law) of any such Governmental Authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on that
Purchaser's capital or the capital of its holding company as a consequence of
this Agreement, the commitment of that Purchaser to make Purchases or the
Purchases made by that Purchaser pursuant hereto to a level below what that
Purchaser or its holding company could have achieved but for the adoption,
change or compliance (taking into consideration the respective Purchaser's
policies, and the policies of its holding company, with respect to capital
adequacy), then, upon written notice from that Purchaser to Transferor and
Servicer (with a copy to the Agent), signed by an officer of that Purchaser with
knowledge of and responsibility for such matters, and setting forth in
reasonable detail the calculation used to arrive at the amounts, any additional
amounts as will compensate that Purchaser or its holding company on an after-tax
basis for the reduction shall constitute "Additional Amounts" for purposes of
the Supplement, and that Purchaser shall be entitled to receive these additional
amounts, solely from amounts allocated thereto and paid pursuant to the
Supplement.
(c) A Purchaser shall promptly notify Transferor, Servicer and the Agent
in writing of any event of which it has knowledge occurring after the date
hereof that will entitle it to compensation pursuant to this section. A
certificate of a Purchaser, signed by an officer of such Purchaser with
knowledge of and responsibility for such matters, and setting forth in
reasonable detail the calculation used to arrive at the amounts necessary to
compensate that Purchaser or its holding company as specified in subsection (a)
or (b), as the case may be, shall be delivered to Transferor, Servicer and the
Agent and shall be conclusive absent demonstrable error.
(d) Failure on the part of a Purchaser to demand compensation for any
amounts as specified in subsection (a) or (b) with respect to any period shall
not constitute a waiver of its right to demand compensation with respect to that
period or any other period. The protection of this section shall be available to
the Purchasers regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, guideline or other change or
condition that shall have occurred or been imposed.
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(e) Promptly after giving any notice to Transferor pursuant to this
section, a Purchaser will seek to designate one of its offices located at an
address other than that previously designated pursuant to this Agreement as the
office from which its Purchases will be made after the designation if it will
avoid the need for, or materially reduce the amount of, any payment to which
that Purchaser would otherwise be entitled pursuant to this section and will
not, in the sole discretion of that Purchaser, be otherwise disadvantageous to
such Purchaser.
SECTION 4.4 Illegality; Unavailability. (a) In the event that on any date
any Purchaser shall have determined (which determination shall be final and
conclusive and binding upon all parties) that the making or continuation of its
Purchases as Eurodollar Tranches has become unlawful by compliance by that
Purchaser in good faith with any law, governmental rule, regulation or order or
has become impossible as a result of a contingency occurring after the date
hereof that materially and adversely affects its interbank eurodollar market,
then, and in any such event, that Purchaser shall promptly give notice (by
telephone confirmed in writing) to Transferor, Servicer and the Agent (which
notice the Agent shall promptly transmit to each Purchaser) of that
determination. The obligation of the affected Purchaser to make or maintain its
Purchases as Eurodollar Tranches during any such period shall be terminated at
the earlier of the termination of the Interest Period then in effect for each
Eurodollar Tranche or when required by law, and Transferor shall, no later than
the time specified for the termination, convert any Purchases of the affected
Purchaser that constitute part of any Eurodollar Tranche into a part of the ABR
Tranche.
(b) If, prior to the beginning of any Interest Period, the Agent shall
have determined (which determination shall be final and conclusive and binding
upon all parties) that: (i) Dollar deposits in the relevant amount and for the
Interest Period are not available in the relevant interbank eurodollar market or
(ii) by reason of circumstances affecting the interbank eurodollar market, that
adequate and fair means do not exist for ascertaining the Eurodollar Rate
applicable to a Eurodollar Tranche, then the Agent shall promptly give notice of
this determination to Transferor, Servicer and each Purchaser. Thereafter, and
continuing until the Agent shall notify Transferor, Servicer and each Purchaser
that the circumstances giving rise to this determination no longer exist, (x)
each Eurodollar Tranche will, on the last day of the applicable Interest Period,
convert into a part of the ABR Tranche, (y) the right of Transferor to request
Eurodollar Tranches shall be suspended and (z) any Purchases requested to be
made as Eurodollar Tranches prior to such time but not yet made shall be made as
ABR Tranches.
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SECTION 4.5 Indemnity. If a Purchaser shall incur any losses, expenses or
liabilities (including any interest paid to lenders of funds borrowed by it to
fund any Purchase of a Certificate as a Eurodollar Tranche and any loss
sustained in connection with the re-deployment of such funds) as a result of (a)
the failure of a Purchase to be made on a date specified therefor in a notice
delivered pursuant to Section 2.2 (other than any such failure resulting from
the Purchaser's default in the performance of its obligations hereunder) or (b)
any payment, including under Section 3.1, of a Eurodollar Tranche on a date that
is not the last day of the Interest Period applicable thereto or on any date
specified in a notice of payment given by Servicer, then, upon written notice
(which notice shall be signed by an officer of such Purchaser with knowledge of
and responsibility for such matters and shall set forth in reasonable detail the
basis for requesting the amounts) from such Purchaser to Transferor and
Servicer, additional amounts sufficient to indemnify such Purchaser against the
losses, expenses and liabilities, but not for any lost profits associated
therewith, shall constitute "Additional Amounts" for purposes of the Supplement,
and the Purchaser shall be entitled to receive these additional amounts, solely
from amounts allocated thereto and paid pursuant to the Supplement.
SECTION 4.6 Taxes. (a) Any and all payments made to each Purchaser under
its Certificate shall be made free and clear of and without deduction for any
and all present or future taxes, levies, imposts, duties, charges, fees,
deductions or withholdings of any nature and whatever called, by whomsoever, on
whomsoever and wherever imposed, levied, collected, withheld or assessed,
excluding taxes imposed by the jurisdiction in which that Purchaser's principal
office (and/or the office where it books its investment in its Certificate) is
located on all or part of the net income, profits or gains of that Purchaser
(whether worldwide, or only insofar as such income, profits or gains are
considered to arise in or to relate to a particular jurisdiction, or otherwise)
(all the nonexcluded taxes, levies, imposts, charges, deductions, withholdings
and liabilities being hereinafter referred to as "Taxes"). If Trustee or the
Agent are required by law to deduct any Taxes from or in respect of any sum
payable hereunder or under any Certificate to the Purchasers, then the sum
payable shall be increased by the amount necessary to yield to each Purchaser
(after payment of all Taxes) an amount equal to the sum it would have received
had no deductions been made, and the additional amount shall constitute
"Additional Amounts" for purposes of the Supplement, and such Purchaser shall be
entitled to receive these additional amounts, solely from amounts allocated
thereto and paid pursuant to the Supplement.
(b) Whenever any Taxes are paid by Trustee pursuant to subsection (a), as
promptly as possible thereafter, Servicer shall send to the relevant
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Purchaser the original or a certified copy of an original official receipt
showing payment thereof (if any) or any other evidence of the payment as may be
available to Servicer through the exercise of its reasonable efforts. If Trustee
fails to pay any Taxes when due to the appropriate taxing authority or fails to
remit to the Purchaser the required receipts or other required documentary
evidence, each Purchaser shall be entitled to receive, solely from amounts
allocated with respect thereto and paid pursuant to the Supplement, additional
amounts necessary to indemnify it for any incremental taxes, interest or
penalties that may become payable by such Purchaser as a result of any such
failure, and the amounts shall constitute "Additional Amounts" for purposes of
the Supplement, and such Purchaser shall be entitled to receive these additional
amounts, solely from amounts allocated thereto and paid pursuant to the
Supplement.
(c) On or before the date it becomes a party to this Agreement (and, so
long as it may properly do so, periodically thereafter, as requested by
Servicer, to keep forms up to date), each Purchaser that is organized under the
laws of a jurisdiction outside the United States of America shall deliver to
Trustee any certificates, documents or other evidence that shall be required by
the Internal Revenue Code or Treasury Regulations issued pursuant thereto to
establish that, assuming the Certificates are properly characterized as
indebtedness, it is exempt from existing United States Federal withholding
requirements, including (i) two original copies of Internal Revenue Service Form
1001 or Form 4224 or successor applicable form, properly completed and duly
executed by each such Purchaser certifying that it is entitled to receive
payments under this Agreement without deduction or withholding of any United
States Federal income taxes, and (ii) an original copy of Internal Revenue
Service Form W-8 or W-9 or applicable successor form, properly completed and
duly executed; provided, that if any Purchaser does not comply with this
subsection 4.6(c), amounts payable to such Purchaser under this Section 4.6
shall be limited to amounts that would have been payable under this section if
such Purchaser had so complied.
ARTICLE 5 OTHER PAYMENT TERMS
SECTION 5.1 Time and Method of Payment. (a) All amounts payable to any
Purchaser hereunder or with respect to its Certificate shall be made to the
Agent for the account of the Purchaser by wire transfer of immediately available
funds in Dollars not later than 2:00 p.m., New York City time, on the date due.
Any funds received after that time will be deemed to have been received on the
next Business Day. The Agent shall distribute all payments to the Purchasers,
in accordance with their respective interests, prior to the close of business on
the Business Day on which any payment is deemed received.
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(b) On any date on which a payment to one or more Purchasers hereunder or
under the Certificates is due and payable, the Agent may (but in no event shall
be required to) assume that the payment has been made available to the Agent on
the date of the payment in accordance with this section, and the Agent may (but
in no event shall be required to), in reliance upon this assumption, make
payment of a corresponding amount to the Purchasers. If and to the extent any
amounts shall not have so been made available to the Agent, each Purchaser
irrevocably and unconditionally agrees to repay to the Agent forthwith on demand
the amount of payment it received together with interest thereon, for each day
from the date payment is made by the Agent until the date the amount is repaid
to the Agent, (i) for the first three days following the date the payment is
made, at a rate per annum equal to the Federal Funds Rate and (ii) thereafter,
at a rate per annum equal to the Federal Funds Rate plus 1%.
SECTION 5.2 Pro Rata Treatment. Each repayment of the principal of the
Certificates (except as otherwise required by Section 2.2(c)), each payment of
interest thereon, each payment of the Non-Usage Fee, each reduction of the
Stated Amounts of the Certificates and each conversion or continuation of any
Tranche in respect of the Certificates (except as otherwise required by Sections
4.3(c) and 4.4(b) with respect to conversions) shall be allocated pro rata among
the Purchasers of the Certificates on the date of payment or reduction, in
accordance with their respective Class Percentages. Each Purchaser agrees that
in computing its portion of any Purchases to be made hereunder, the Agent may,
in its discretion, round each Purchaser's pro rata share of the Purchases to the
next higher or lower whole dollar amount.
ARTICLE 6 REPRESENTATIONS AND WARRANTIES
SECTION 6.1 Transferor. As of the date hereof, Transferor represents and
warrants to the Purchasers that each of its representations and warranties in
the Pooling Agreement and Purchase Agreement is true and correct, as if made on
the date hereof, and further represents and warrants that:
(a) no Early Amortization Event or Unmatured Early Amortization Event
exists;
(b) assuming the accuracy of the Purchasers' representations set out
in Section 6.3 and that no Purchaser (and no Person acting on any Purchaser's
behalf) has made a general solicitation or general advertising within the
meaning of the Securities Act, the offer and sale of the Certificates in the
manner contemplated by this Agreement is a transaction exempt from the
registration requirements of the Securities
page 12
Act, and the Pooling Agreement is not required to be qualified under the Trust
Indenture Act of 1939, as amended;
(c) except for BT Securities Corporation, in its capacity as
financial advisor for Transferor ("Financial Advisor"), Transferor has not dealt
with any financial advisor, or other Person who may be entitled to any
commission or compensation in connection with the sale of the Certificates, and
the fees of the Financial Advisor shall not be an obligation of the Purchasers
or the Agent;
(d) no information supplied by or on behalf of Transferor or APP to
the Agent or the Purchasers in connection with the Transaction Documents
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein or therein not misleading
in light of the circumstances under which they were made;
(e) the Certificates have been duly and validly authorized by
Transferor and, from and after the date on which the Certificates are executed
by Transferor and authenticated by the Trustee in accordance with the terms of
the Pooling Agreement and the Supplement and delivered to and paid for by the
Purchasers in accordance with the terms of this Agreement, will be validly
issued and outstanding and will constitute valid and legally binding obligations
of the Trust entitled to the benefits of the Pooling Agreement and the
Supplement and enforceable against the Trust in accordance with their terms; and
(f) the Certificates are not subject to any Adverse Claim and the
Transferor is conveying to the Purchasers all of its right, title and interest
in such Certificates.
SECTION 6.2 APP. As of the date hereof, APP represents and warrants to the
Purchasers that:
(a) each of its representations and warranties in the Pooling
Agreement (in its capacity as Servicer) and the Purchase Agreement (in its
capacity as a Seller) is true and correct, as if made on the date hereof with
the same effect as if made on that date (unless specifically stated to relate to
an earlier date);
(b) the Pro Forma Financial Data present fairly in all material
respects the pro forma financial position, results of operations and cash flows
of APP and its consolidated Subsidiaries at the dates specified
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therein and for the periods to which they relate and have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis, except as otherwise stated therein;
(c) since September 30, 1995 through the date hereof (and except as
contemplated in the Pro Forma Financial Data) (i) there has been no material
adverse change in the condition, financial or otherwise, or the earnings,
business affairs or business prospects of Transferor or APP, whether or not
arising in the ordinary course of business, and (ii) there have been no
transactions entered into by Transferor or APP that are material with respect to
the condition, financial or otherwise, or the earnings, business affairs or
business prospects of Transferor or APP; and
(d) no information supplied by or on behalf of Transferor or APP to the
Agent or the Purchasers in connection with the Transaction Documents contains
any untrue statement of a material fact or omits to state a material fact
necessary to make the statements contained herein or therein not misleading in
light of the circumstances under which they were made.
SECTION 6.3 Purchasers. As of the date hereof (or such later date on which
it acquires its Certificate in accordance with Section 10.3), each Purchaser
represents and warrants that:
(a) it is an "accredited investor" as that term is defined in any of
paragraphs (1), (2), (3) or (7) of Rule 501(a) under the Securities Act and is
not purchasing its Certificate with a view to making a distribution thereof
(within the meaning of the Securities Act); and
(b) it is not a pension, profit sharing or other employee benefit plan
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and the assets being used to purchase its Certificate do not
constitute the assets of any "benefit plan investor" (as defined under ERISA).
ARTICLE 7 CONDITIONS
SECTION 7.1 Conditions to Initial Purchase. The obligation of each
Purchaser to Purchase its Certificate shall be subject to the satisfaction of
the conditions precedent that:
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(i) the conditions precedent specified in Section 4.1 of the
Purchase Agreement and Sections 5.1 and 5.2 of the Class B Certificate
Purchase Agreement (other than those that relate to this Agreement) shall
be satisfied;
(ii) the Agent shall have received, for the account of such
Purchaser, a duly executed and authenticated Certificate registered in its
name and in a Stated Amount equal to the amount set out opposite its name
on the signature pages of this Agreement;
(iii) the Agent shall have received certain fees and reimbursement of
any expenses referred to in Section 10.5 for which invoices have been
presented; and
(iv) the Agent shall have received, for the account of such
Purchaser, an original (except as indicated below) counterpart of the
following (each of which, if not in a form attached to this Agreement,
shall be in form and substance satisfactory to the Agent):
(a) the Pooling Agreement, the Purchase Agreement and the
Guaranty, each of which shall be in full force and effect, and all
actions required to be taken under those documents in connection with
the issuance of the Certificates shall have been taken;
(b) photocopies of each Account Agreement;
(c) a certificate of the Secretary, or an Assistant Secretary,
of each of Transferor, Servicer, Guarantor and each Seller with
respect to:
(i) attached copies of resolutions of its Board of
Directors then in full force and effect authorizing the
execution, delivery and performance of the Transaction Documents,
(ii) the incumbency and signatures of those of its officers
authorized to act with respect to the Transaction Documents,
(iii) attached copies of its certificate of incorporation
and by-laws;
page 15
(d) a certificate of an Authorized Officer of each of Servicer,
and each Seller as to the satisfaction of the conditions precedent set
forth in Section 7.2 and a certificate of Transferor that the
representations and warranties of the Transferor set out in this
Agreement are true and correct as of the date of such initial purchase
and that, to the best of Transferor's knowledge, no Early Amortization
Event or Unmatured Early Amortization Event exists;
(e) a certificate of an appropriate officer of Trustee stating
that the Pooling Agreement has been duly authorized, executed and
delivered by Trustee and the Certificates have been duly authenticated
by Trustee in accordance with the Pooling Agreement and an opinion of
counsel to Trustee as to related matters;
(f) the following opinions, in form and substance satisfactory
to the Agent:
(i) opinions of Kirkland & Ellis as to certain corporate
matters, Federal and state tax and UCC matters, true sale and
non-consolidation; and
(ii) opinions of Hirsch & Westheimer as to certain Texas
state tax and UCC matters;
(g) the Daily Report for the date hereof;
(h) evidence, reasonably satisfactory to the Agent and the
Purchasers, of the payment of all taxes, fees and other governmental
charges, if any, incidental to the issuance of the Certificates and to
the consummation of the transactions contemplated hereunder and under
the Pooling Agreement;
(i) evidence that S&P has rated the Certificates "AAA";
(j) agreed-upon procedures letters, in form and substance
satisfactory to the Agent, from Price Waterhouse LLP and KPMG Peat
Marwick, with respect to certain historical information provided by
APP relating to the Receivables;
page 16
(k) copies of any management or other agreements with regard to
the administration of Transferor's business, certified by an
Authorized Officer of Transferor;
(l) a pro forma balance sheet of Transferor as of the date
hereof, after giving effect to the transactions contemplated by the
Supplement;
(m) a payout letter from the Holders of the Series 1995-1
Certificates, (i) specifying the aggregate amount required to be paid
to such Holders in order to pay all principal, accrued interest and
other currently existing claims of such Holders under such
Certificates, the related supplement to the Existing Pooling Agreement
and the related certificate purchase agreement, and (ii) subordinating
any contingent claims of such Holders under such documents to amounts
owed under the Supplement and the Series 1996-1 Certificates;
(n) results of recent searches of the UCC filing records and tax
and ERISA and judgment lien records in each jurisdiction referred to
below against each Seller (including any predecessors in interest to
any Seller going back five years) and Transferor, showing no filings
of record that cover any of the Receivables or the Related Transferred
Assets other than (i) filings in favor of parties to Intercreditor
Agreements and (ii) the following filings (which must be shown to be
on file):
(i) UCC financing statements naming each Seller, as
seller/debtor, and Transferor, as secured party/ purchaser, in
each office where the filing is necessary for the perfection of
the sales of Receivables by each Seller to Transferor;
(ii) assignments of such existing UCC financing statements
to Trustee, as assignee of the secured party, in each office
where the filing is necessary for the perfection of the sales of
Receivables by each Seller to Transferor; and
(iii) UCC financing statements naming Transferor, as
seller/debtor, and Trustee, as secured party/purchaser, in each
office where the filing is
page 17
necessary for the perfection of the transfers of Receivables
by Transferor to Trustee; and
(o) any other information, certificates, opinions and
documents as the Agent may have reasonably requested.
If the conditions specified above have not been fulfilled on the date
hereof, any condition specified in this Agreement shall not have been fulfilled
when and as required in this Agreement or waived by the Purchasers, in each case
a Purchaser's obligations to purchase the Certificates pursuant to this
Agreement may be terminated by notice to Transferor, the Trustee and the Agent.
In addition, if, under the circumstances, it shall not be feasible for the
Purchasers to invest on the date the funds that are held available by the
Purchasers for the Purchase, Transferor shall pay the Purchasers interest on the
funds at the Alternate Base Rate from the date of the notice until the next
succeeding Business Day on which it is feasible for the Purchasers to invest the
funds. Nothing in this paragraph shall operate to relieve Transferor from any of
its obligations hereunder or otherwise waive any of the Purchasers' rights
against Transferor.
SECTION 7.2 Conditions to Each Purchase. The obligation of each Purchaser
to make any Purchase on any day (including those comprising the initial
Purchase) shall be subject to the Agent's receipt of the Daily Report for that
day and to the conditions precedent that on the date of the Purchase, before and
after giving effect thereto and to the application of any proceeds therefrom,
the following statements shall be true:
(a) the representations and warranties of Transferor and APP set out
in this Agreement are true and accurate as of that date with the same
effect as though made on that date (unless specifically stated to relate to
an earlier date); and
(b) no Early Amortization Event or Unmatured Early Amortization Event
has occurred and is continuing.
The giving of any notice pursuant to Section 2.2 shall constitute a
representation and warranty by Transferor and APP that the foregoing statements
(limited, in the case of subsection (a) to the representations and warranties of
the Person deemed to make the representation and warranty referred to in this
sentence) are true.
page 18
ARTICLE 8 COVENANTS
SECTION 8.1 Covenants. Transferor and APP each severally covenant and agree
that, until the Certificates have been paid in full, it will:
(a) with reasonable promptness deliver to each Purchaser such
information, documents, records or reports respecting the Program or the
Receivables as such Purchaser may from time to time reasonably request (to
the extent that such items are reasonably accessible to Transferor);
(b) at the same time any report (including any Daily Report, Monthly
Report or annual auditors' report), notice or other document is provided,
or caused to be provided, by Transferor or Servicer to Trustee under the
Pooling Agreement, provide the Agent with a copy of the report; and
(c) during regular business hours and (so long as no Early
Amortization Event has occurred and is continuing) upon two Business Days
prior written notice, permit the Agent (or such other Person as Trustee or
the Agent may designate from time to time), or their respective agents or
representatives (including certified public accountants or other auditors),
as an expense of Servicer paid out of the Servicing Fee, (i) to examine and
make copies of and abstracts from, and to conduct accounting reviews of,
all Records in the possession or under the control of Servicer, Transferor
or any Seller, including the related Contracts and purchase orders,
invoices and other agreements related thereto, and (ii) to visit the
offices and properties of Servicer, Transferor or any Seller for the
purpose of examining such materials described in clause (i), and to discuss
matters relating to the Receivables or the Related Transferred Assets or
the performance by Servicer, Transferor or any Seller of their respective
obligations under any Transaction Document with any officer, employee or
representative of Servicer, Transferor or any Seller. The Agent may (but
shall not be obligated to) conduct, or cause their respective agents or
representatives to conduct, reviews of the types described in this
paragraph (each such review, a "Receivables Review") whenever the Agent, in
its reasonable judgment, deems any such review appropriate.
SECTION 8.2 Transfers. Each Purchaser agrees that it will not transfer
its Class A Certificate (or any portion thereof) to any Person unless such
Person shall have provided the Trustee, the Agent and Transferor with a
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certificate to the effect that such Person: (a) is an "accredited investor" as
that term is defined in any of paragraphs (1), (2), (3) or (7) of Rule 501(a)
under the Securities Act and is not purchasing its Certificate with a view to
making a distribution thereof (within the meaning of the Securities Act) and (b)
is not a pension, profit sharing or other employee benefit plan subject to the
Employee Retirement Income Security Act of 1974, as amended.
ARTICLE 9 AGENT
SECTION 9.1 Appointment. The Purchasers hereby designate ABN AMRO Bank
N.V. as Agent. Each Purchaser hereby irrevocably authorizes the Agent to take
action on its behalf under the provisions of the Transaction Documents and any
other instruments and agreements referred to therein and to exercise the powers
and perform the duties hereunder and thereunder that are specifically delegated
to or required of the Agent by the terms hereof and thereof, and any other
powers as are reasonably incidental thereto. The Agent may perform any of its
duties by or through its officers, directors, agents or employees.
SECTION 9.2 Nature of Duties. The Agent shall not have any duties or
responsibilities except those expressly set forth in this Agreement. Neither the
Agent nor any of its officers, directors, agents or employees shall be liable
for any action taken or omitted by it or them under any Transaction Document or
in connection herewith or therewith, unless caused by their gross negligence or
willful misconduct. The duties of the Agent shall be mechanical and
administrative in nature, the Agent shall not have by reason of this Agreement a
fiduciary relationship in respect of any Purchaser, and nothing in any
Transaction Document, expressed or implied, is intended to or shall be construed
as to impose upon the Agent any obligations in respect of any Transaction
Document except as expressly set forth herein. The Agent shall not be required
to take any action which exposes it to personal liability, or is contrary to
this Agreement or applicable law.
SECTION 9.3 Lack of Reliance on Agent and Financial Advisor. Independently
and without reliance upon the Agent or the Financial Advisor, each Purchaser, to
the extent it deems appropriate, has made and shall continue to make (a) its own
independent investigation of the financial condition and affairs of Transferor,
the Seller, Servicer and the Trust in connection with the making and the
continuation of each Purchase and the taking or not taking of any action in
connection herewith and (b) its own appraisal of the creditworthiness of
Transferor, the Seller and Servicer and the merits and risks of an investment in
the Certificates, and, except as expressly provided in this Agreement, the Agent
shall not have any duty or
page 20
responsibility, either initially or on a continuing basis, to provide any
Purchaser with any credit or other information with respect thereto, whether
coming into its possession before the making of a Purchase or at any time or
times thereafter. The Agent shall not be responsible to any Purchaser for any
recitals, statements, information, representations or warranties herein or in
any document, certificate or other writing delivered in connection herewith or
for the execution, effectiveness, genuineness, validity, enforceability,
perfection, collectibility, priority or sufficiency of the Transaction Documents
or the financial condition of Transferor, the Sellers, Servicer or the Trust or
be required to make any inquiry concerning either the performance or observance
of any of the terms, provisions or conditions of any Transaction Document, or
the financial condition of Transferor, the Sellers, Servicer or the Trust or the
existence or possible existence of any Early Amortization Event or Unmatured
Early Amortization Event. The Agent shall not be deemed to have knowledge of any
Early Amortization Event or Unmatured Early Amortization Event unless the Agent
shall have received notice from a Purchaser, the Transferor, the Servicer or the
Trustee stating the same.
SECTION 9.4 Certain Rights of Agent. If the Agent shall request
instructions from the Purchasers whose aggregate Class Percentages exceed 50%
(the "Required Class A Purchasers") with respect to any act or action (including
failure to act) in connection with any Transaction Document, the Agent shall be
entitled to refrain from acting or taking the action unless and until the Agent
shall have received instructions from the Required Class A Purchasers, and the
Agent shall not incur liability to any person by reason of acting or so
refraining. Without limiting the foregoing, no Purchaser shall have any right of
action whatsoever against the Agent as a result of the Agent acting or
refraining from acting under any Transaction Document in accordance with the
instructions of the Required Class A Purchasers or for refraining to act in the
absence of instruction.
SECTION 9.5 Reliance. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any note, writing, resolution, notice,
statement, certificate, telex, teletype or telecopier message, cablegram,
radiogram, order or other document or telephone message signed, sent or made by
any person that the Agent believed to be the proper person. The Agent may
consult with legal counsel (including counsel for any APP Person), independent
public accountants and other experts selected by the Agent and shall not be
liable for any action taken or omitted to be taken in accordance with the advice
of such counsel, accountants or experts.
SECTION 9.6 Indemnification. To the extent the Agent is not reimbursed
and indemnified by Transferor or Servicer, the Purchasers will
page 21
reimburse and indemnify the Agent ratably in accordance with their respective
Class Percentages from and against any and all liabilities, obligations, losses,
damages, penalties, claims, actions, judgments, suits, costs, expenses or
disbursements of whatsoever kind or nature that may be imposed on, asserted
against or incurred or suffered by the Agent (including fees and expenses of
legal counsel, accountants and experts) in performing its duties or as a result
of any action taken or omitted to be taken by such Agent under any Transaction
Document or in any way relating to or arising out of any Transaction Document;
provided that no Purchaser shall be liable for any portion of these liabilities,
obligations, losses, damages, penalties, claims, actions, judgments, suits,
costs, expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct (as determined by a court of competent jurisdiction in a
final and non-appealable order).
SECTION 9.7 Agent in its Individual Capacity. With respect to its
obligation to purchase a Certificate under this Agreement, the Agent shall have
the rights and powers specified herein for a Purchaser and may exercise the same
rights and powers as though it were not performing the duties of the "Agent"
specified herein, and the term "Purchasers," "Required Purchasers," "Required
Class A Purchasers" and "Holders" or "payees" of any Certificates or any similar
terms shall, unless the context clearly otherwise indicates, include the Agent
in its individual capacity. The Agent and its Affiliates may accept deposits
from, lend money to and generally engage in any kind of banking, trust or other
business with Transferor or Servicer or any APP Person as if the Agent were not
performing the duties specified herein, and may accept fees and other
consideration from Transferor or Servicer for services in connection with this
Agreement and otherwise without having to account for the same to the
Purchasers.
SECTION 9.8 Resignation by Agent. (a) The Agent may resign at any time by
giving notice to Transferor and the Purchasers. Such resignation shall take
effect upon the appointment of a successor Agent pursuant to subsections (b) and
(c) below or as otherwise provided below.
(b) Upon any notice of resignation of the Agent, the Required Class A
Purchasers shall appoint a successor Agent hereunder who shall be a commercial
bank or trust company reasonably acceptable to Transferor (it being understood
and agreed that any Purchaser is deemed to be acceptable to Transferor).
(c) If a successor Agent is not appointed pursuant to subsection (b)
within 30 days after the delivery of the notice referred to in subsection (a),
the resigning Agent, with the consent of Transferor, shall then appoint a
successor
page 22
Agent who shall serve as Agent hereunder until the time, if any, that the
Required Class A Purchasers appoint a successor Agent as provided above.
(d) If no successor Agent has been appointed pursuant to subsection (b) or
(c) above by the 60th day after the date notice of resignation was given by the
resigning Agent, such Agent's resignation shall become effective and the
Purchasers shall thereafter perform all the duties of the Agent under the
Transaction Documents until the time, if any, that the Required Class A
Purchasers appoint a successor Agent as provided above.
ARTICLE 10 MISCELLANEOUS PROVISIONS
SECTION 10.1 Amendments. Transferor and APP each severally covenant and
agree that, until the Certificates have been paid in full, it will not, except
as contemplated by Section 13.1 of the Pooling Agreement, amend or otherwise
modify any Transaction Document to which it is a party or grant any waiver or
consent thereunder, without the prior written consent of the Required Series
Holders; provided that no amendment shall (i) reduce in any manner the amount
of, or delay the timing of, allocations, payments or distributions in respect of
any Certificate without the prior written consent of the related Purchaser; (ii)
amend, modify or waive any provision of this Agreement that requires the
approval or consent of a specified percentage of Purchasers without the prior
written consent of that percentage of Purchasers; (iii) amend, modify or waive
the provisions of this section with respect to the rights of any Purchaser, or
the Class Percentage or Series Percentage of any Purchaser, without the prior
written consent of that Purchaser; or (iv) amend, modify or waive the rights or
duties of the Agent hereunder without the prior written consent of the Agent;
provided further that neither the execution and delivery of a Supplement
relating to a refinancing of the Certificates as contemplated by Section 4.9 of
the Supplement relating to the Certificates, nor any other amendment to the
Transaction Documents in connection with such a refinancing, shall require any
consent from any Purchaser, so long as the prior or contemporaneous repayment in
full of the Certificates in accordance with Section 5.2 of the Supplement
relating to the Certificates is a condition to the issuance of the refinancing
certificates, and of the effectiveness of such related amendment.
SECTION 10.2 No Waiver; Remedies. Any waiver, consent or approval given
by any party hereto shall be effective only in the specific instance and for the
specific purpose for which given, and no waiver by a party of any breach or
default under this Agreement shall be deemed a waiver of any other breach or
default. No failure on the part of any party hereto to exercise, and no delay in
exercising, any right hereunder shall operate as a
page 23
waiver thereof; nor shall any single or partial exercise of any right hereunder,
or any abandonment or discontinuation of steps to enforce the right, power or
privilege, preclude any other or further exercise thereof or the exercise of any
other right. No notice to or demand on any party hereto in any case shall
entitle such party to any other or further notice or demand in the same, similar
or other circumstances. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 10.3 Successors and Assigns; Assignments. (a) This Agreement
shall be binding upon, and inure to the benefit of, Transferor, Servicer, the
Agent, the Purchasers and their respective successors and assigns; provided that
neither Transferor nor Servicer may assign its rights or obligations hereunder
(voluntarily, by operation of law or otherwise) without the prior written
consent of all the Purchasers, except that the Servicer may be terminated in
accordance with Sections 10.1 and 10.2 of the Pooling Agreement; and provided
further, that no Purchaser may transfer, pledge, assign, sell participations in
or otherwise encumber its rights or obligations hereunder or any interest herein
except as permitted under this section.
(b) Each Purchaser may at any time sell to one or more banks or other
entities ("Participants") participating interests in all or any portion of its
Certificate and its obligations hereunder (its "Credit Exposure"). In the event
of any sale by a Purchaser of participating interests to a Participant, that
Purchaser shall notify Transferor and the Agent of the identity of the
Participant upon a request by Transferor, that Purchaser's obligations under
this Agreement shall remain unchanged, that Purchaser shall remain solely
responsible for the performance thereof, and that Purchaser shall remain the
holder of its rights under its Certificate and this Agreement for all purposes
under this Agreement, and the other parties to the Transaction Documents shall
continue to deal solely and directly with the Purchaser in connection with such
rights and obligations under this Agreement. Transferor agrees that each
Participant shall be entitled to the benefits of Sections 4.3, 4.4, 4.5 and 4.6
with respect to its participation in the Certificate. The Purchasers agree that
any agreement between them and any Participant in respect of a participating
interest shall require the Participant to comply with the terms of Section 10.13
and (except in the case of a participation sold by a Structured Lender to its
Support Bank) shall not restrict the Purchasers' right to agree to any
amendment, supplement or modification of the Transaction Documents except to (i)
extend the final maturity of any obligation, (ii) reduce the rate or extend the
time of payment of interest thereon or any fees owed to the Purchasers under the
Transaction Documents, (iii) reduce the principal amount of any obligation, (iv)
release or direct the release of all or substantially all of the Transferred
Assets or Trustee's claim to the Transferred Assets, (v) reduce
page 24
substantially the amount of any reserve included in the calculation of the Base
Amount, (vi) increase the amount of the participation from the amount thereof
then in effect, or (vii) permit assignment or transfer by Transferor or APP of
its rights or obligations under the Transaction Documents.
(c) Any Purchaser may at any time assign to one or more banks or other
financial institutions ("Assignees") all or any part of its Credit Exposure;
provided that (i) unless assigned to an Affiliate of the Purchaser or, in the
case of an assignment by a Structured Lender, to its Support Bank, it assigns
all of its Credit Exposure or a portion of its Credit Exposure in an amount not
less than $5,000,000, (ii) any Assignee (other than an existing Purchaser, an
Affiliate of the Purchaser or, in the case of an assignment by a Structured
Lender, its Support Bank) must be reasonably acceptable to the Agent and
Transferor, which acceptance shall not be delayed or withheld unreasonably,
(iii) if such Assignee is organized under the laws of a jurisdiction outside the
United States of America, such Assignee shall satisfy the requirements of
Section 4.6(c), or amounts payable to it under Section 4.6 shall be limited to
amounts that would be payable if such Assignee had complied with Section 4.6(c)
and (iv) such Assignee shall have made the representations and warranties in
Section 6.3 with respect to itself and shall have agreed to be bound by the
provisions hereof. In the event of any assignment, the respective Purchaser
shall comply with Article VI of the Pooling Agreement and also shall give notice
to Transferor and the Agent and shall deliver to the Agent, for acceptance and
recording in its records, an assignment agreement substantially in the form of
Exhibit D together with a processing and recordation fee of, in the case of
assignments to a Purchaser or an Affiliate of a Purchaser, $1,500 and, in cases
of any other assignment, $3,500. Within five Business Days of receipt thereof,
the Agent shall (if the assignment agreement has been fully executed by the
Assignee, the assignor Purchaser and Transferor, is completed and is in
substantially the form of Exhibit D) execute the assignment agreement and record
the information contained therein in its records. Upon the earlier of the
expiration of the five Business Day period after receipt by the Agent or the
date of the recording, the assignment will become effective. Transferor, the
Agent and the Purchasers agree to extend the rights and benefits under this
Agreement to any Assignee to the extent such Assignee would have had if it were
a Purchaser that was an original signatory to this Agreement; provided, that
Transferor shall be entitled to continue to deal solely and directly with the
assignor Purchaser in connection with the interests so assigned to the Assignee
until the assignment agreement and any required fee, as described above, shall
have been delivered to Transferor and the Agent by the assigning Purchaser and
the Assignee and the assignment shall have become effective. Upon the effective
assignment of its Credit
page 25
Exposure, the assigning Purchaser shall be relieved of its obligations hereunder
to the extent of the assignment.
(d) The sale or assignment of any Credit Exposure to any Assignee or
Participant (each, a "Transferee") shall not be effective until it has agreed to
be bound by the provisions of Section 10.13. Transferor and APP each authorize
the Purchasers to disclose to any Transferee and any prospective Transferee any
and all information in their possession concerning Transferor and APP that has
been delivered to them by Transferor, APP or Trustee in connection with their
credit evaluation of the Program prior to entering into this Agreement.
(e) Notwithstanding any other provisions set forth in this Agreement, the
Purchasers may at any time create a security interest in all or any portion of
their rights under this Agreement and the Certificates in favor of any Federal
Reserve Bank in accordance with Regulation A of the Board of Governors of the
Federal Reserve System.
SECTION 10.4 Survival of Agreement. All covenants, agreements,
representations and warranties made herein and in the Certificates delivered
pursuant hereto shall survive the making and the repayment of the Purchases and
the execution and delivery of this Agreement and the Certificates and shall
continue in full force and effect until all obligations have been paid in full
and all commitments of the Purchasers hereunder have been terminated. In
addition, the obligations of Transferor under Sections 4.3, 4.4, 4.5, 4.6 and
10.5 and the obligations of the Purchasers under Section 9.6 shall survive the
termination of this Agreement.
SECTION 10.5 Expenses; Indemnification. Transferor and APP jointly and
severally shall pay on demand (a) all reasonable out-of-pocket fees and expenses
(including reasonable attorneys fees and expenses) of the Agent incurred in
connection with the preparation, execution, delivery, administration, amendment,
modification and waiver of the Transaction Documents and the making and
repayment of the Purchases, including any Servicer or collection agent fees paid
to any third party for services rendered to the Purchasers and the Agent in
collecting the Receivables and (b) all reasonable out-of-pocket fees and
expenses of the Purchasers and the Agent (including reasonable attorneys fees
and expenses of their counsel) incurred in connection with the enforcement of
the Transaction Documents against Transferor, Servicer and the Seller and in
connection with any workout or restructuring of the Transaction Documents. In
addition, Transferor will pay any and all stamp and other taxes and fees payable
or determined to be payable in connection with the execution, delivery, filing,
recording or
page 26
enforcement of this Agreement or any payment made under the Transaction
Documents, and hereby indemnifies and saves the Agent and the Purchasers
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay the taxes and fees. Transferor and
APP jointly and severally agree to reimburse and indemnify the Agent and each
Purchaser and their respective officers, directors, shareholders, controlling
Persons, employees and agents (collectively, the "Indemnitees") from and against
any and all actions, judgments, costs, expenses or disbursements of whatsoever
kind or nature that may be imposed on, asserted against or incurred or suffered
by the Agent or the Purchasers (including fees and expenses of legal counsel,
accountants and experts) in any way relating to or arising out of any event or
circumstance described in the first sentence of this Section.
If any action, suit, proceeding or investigation is commenced, as to which
an Indemnitee proposes to demand indemnification, it shall notify Transferor and
APP with reasonable promptness; provided, however, that any failure by such
Indemnitee to notify Transferor and APP shall not relieve Transferor and APP
from their obligations hereunder (except to the extent that Transferor and APP
are prejudiced by such failure to promptly notify). Transferor and APP shall be
entitled to assume the defense of any such action, suit, proceeding or
investigation, including the employment of counsel reasonably satisfactory to
the Indemnitee. The Indemnitee shall have the right to counsel of its own choice
to represent it; but the fees and expenses of such counsel shall be at the
expense of such Indemnitee unless the Indemnitee shall have been advised by
counsel that there exists an actual or potential conflict of interests among
Transferor and APP and such Indemnitee, including situations in which one or
more legal defenses may be available to such Indemnitee that are inconsistent
with those available to Transferor and APP; provided, however, that Transferor
and APP shall not, in connection with any one such action or proceeding or
separate but substantially similar actions or proceedings arising out of the
same general allegations, be liable for fees and expenses of more than one
separate firm of attorneys at any time for all Indemnitees; and such counsel
shall, to the extent consistent with its professional responsibilities,
cooperate with Transferor and APP and any counsel designated by Transferor and
APP.
Notwithstanding the foregoing (and with respect to clause (w) below,
without prejudice to the rights that an Indemnitee may have pursuant to the
other provisions of the Transaction Documents), in no event shall any Indemnitee
be indemnified against any amounts (w) resulting from gross negligence or
willful misconduct on the part of such Indemnitee (or any of its officers,
directors, employees affiliates or agents) or the failure of such
page 27
Indemnitee to perform its obligations under the Transaction Documents, (x) to
the extent they include amounts in respect of Receivables and reimbursement
therefore that would constitute credit recourse to Servicer for the amount of
any Receivable or Related Transferred Asset not paid by the related Obligor, (y)
to the extent they are or result from lost profits or (z) to the extent they
would constitute consequential, special or punitive damages.
If for any reason the indemnification provided in this section is
unavailable to an Indemnitee or is insufficient to hold it harmless, then
Transferor and APP jointly and severally shall contribute to the amount paid by
the Indemnitee as a result of any loss, claim, damage or liability in a
proportion that is appropriate to reflect not only the relative benefits
received by the Indemnitee on the one hand and Transferor and APP on the other
hand, but also the relative fault of the Indemnitee (if any), Transferor and APP
and any other relevant equitable considerations; provided that Transferor's
obligations under this section shall be paid by Transferor only to the extent
that funds are available to make the payments pursuant to Article IV of the
Supplement, and there shall be no recourse to Transferor for all or any part of
any amounts payable pursuant to this section if the funds are at any time
insufficient to make all or part of any such payments. Any amount which
Transferor does not pay pursuant to the operation of the preceding sentence
shall not constitute a claim (as defined in (S)101 of the Bankruptcy Code)
against or corporate obligation of Transferor for any such insufficiency.
SECTION 10.6 Entire Agreement. This Agreement, together with the documents
delivered pursuant to Section 7.1 and the other Transaction Documents, including
the exhibits and schedules thereto, contains a final and complete integration of
all prior expressions by the parties hereto with respect to the subject matter
hereof and shall constitute the entire agreement among the parties hereto with
respect to the subject matter hereof, superseding all previous oral statements
and other writings with respect thereto.
SECTION 10.7 Notices. All communications hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered, sent by
overnight courier or mailed by registered mail, postage prepaid and return
receipt requested, or transmitted by facsimile transmission and confirmed by a
similar mailed writing to any party at the address for that party set forth (a)
on the signature page to this Agreement or (b) to another address as that party
may designate in writing to the Agent and Transferor.
SECTION 10.8 No Third Party Beneficiaries. Nothing expressed herein is
intended or shall be construed to give any Person (other than the
page 28
Persons listed in Section 10.3) any legal or equitable right, remedy or claim
under or in respect of this Agreement.
SECTION 10.9 Severability of Provisions. Any covenant, provision,
agreement or term of this Agreement that is prohibited or is held to be void or
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of the prohibition or unenforceability without invalidating the
remaining provisions of this Agreement.
SECTION 10.10 Counterparts. This Agreement may be executed in any number
of counterparts (which may include facsimile) and by the different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original, and all of which together shall constitute one and the same
instrument.
SECTION 10.11 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICT OF LAWS PRINCIPLES.
SECTION 10.12 Tax Characterization. Each party to this Agreement (a)
acknowledges that it is the intent of the parties to this Agreement that, for
Federal, state and local income and franchise tax purposes, the Certificates
will be treated as evidence of indebtedness secured by the Transferred Assets
and the Trust will not be characterized as an association (or publicly traded
partnership) taxable as a corporation, (b) agrees to treat the Certificates for
Federal, state and local income and franchise tax purposes as indebtedness and
(c) agrees that the provisions of the Transaction Documents shall be construed
to further these intentions.
SECTION 10.13 No Proceedings. Each of Servicer, the Agent (solely in its
capacity as such) and each Purchaser (solely in its capacity as such) hereby
agrees that it will not institute against Transferor, or join any other Person
in instituting against Transferor, any insolvency proceeding (namely, any
proceeding of the type referred to in the definition of "Bankruptcy Event") so
long as any Series 1996-1 Certificates shall be outstanding or there shall not
have elapsed one year plus one day since the last day on which any Series 1996-1
Certificates shall have been outstanding. The foregoing shall not limit the
right of Servicer, any Agent or any Purchaser to file any claim in or otherwise
take any action with respect to any insolvency proceeding that was instituted
against Transferor by any other Person.
page 29
SECTION 10.14 Reference Banks. By its execution of this Agreement, each
Purchaser identified as "Reference Bank" in the Supplement agrees to act as a
Reference Bank for purposes of the Supplement. The Agent shall notify Servicer
of the Eurodollar Rate applicable to each Interest Period and of each change in
the Alternate Base Rate.
SECTION 10.15 No Recourse. None of the directors, officers or employees
of Transferor shall have any liability to any Person, including, without
limitation, the Trustee or any Purchaser, for any action undertaken or any
certificate delivered or information delivered by such director, officer or
employee hereunder, except to the extent of the gross negligence or willful
misconduct of such director, officer or employee in connection therewith.
page 30
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized officers and delivered as of the day and
year first above written.
NOTEPAD FUNDING
CORPORATION
By: /s/ Gregory M. Benson
----------------------
Name: Gregory M. Benson
--------------------
Title: President
-------------------
Address:
c/o 17304 Preston Road
Suite 700
Dallas, Texas 75252-5613
Attention: Chief Financial Officer
Telephone: (214) 733-6200
Facsimile: (214) 733-6260
AMERICAN PAD & PAPER COMPANY OF DELAWARE, INC.
By: /s/ Gregory M. Benson
----------------------------
Name: Gregory M. Benson
--------------------------
Title: Executive Vice President
-------------------------
Address:
17304 Preston Road
Suite 700
Dallas, Texas 75252-5613
Attention: Chief Financial Officer
Telephone: (214) 733-6200
Facsimile: (214) 733-6260
ABN AMRO BANK N.V.
HOUSTON AGENCY,
as Agent and as a Purchaser
By: ABN AMRO NORTH AMERICA,
INC., as agent
By: /s/ Lila Jordan
----------------
Name: Lila Jordan
------------
Title: Vice President & Director
-------------------------
By: /s/ Ronald A. Mahle
--------------------
Name: Ronald A. Mahle
----------------
Title: Group Vice President & Director
-------------------------------
Address: ABN AMRO Bank N.V.
Houston Agency
3 Riverway
Suite 1700
Houston, TX 77056
Attention: Lila Jordan
Telephone: (713) 964-3312
Facsimile: (713) 629-7533
For all notices, a copy shall also
be sent to:
Address: ABN AMRO Bank N.V.
Attn: Structured Finance
135 South LaSalle Street
Chicago, IL 60603
Attention: Tom Educate
Telephone: (312) 904-2435
Facsimile: (312) 904-6376
Address: ABN AMRO Agency
Services
335 Madison Avenue
14th Floor
New York, NY 10002
Attention: Linda Boardman
Telephone: (212) 370-8509
Facsimile: (212) 682-0364
BANK AUSTRIA, AG,
as a Purchaser
By: /s/ Christopher Best
---------------------
Name: Christopher Best
-------------------
Title: Senior Manager
------------------
Address: Bank Austria, AG
Bank Austria House
32/36 City Road
London, England EC1Y 2BD
Attention: Christopher Best
Telephone: 44-171-382-1020
Facsimile: 44-171-256-8589
MARNIX ASSET FUNDING CORP.,
as a Purchaser
By: /s/ Dominick H. J. Vargaeuer
------------------------------
Name: Dominick H. J. Vargaeuer
----------------------------
Title: Vice President
---------------------------
Address: c/o Bank Brussels Lambert,
New York Branch,
as Portfolio Manager
630 Fifth Avenue
6th Floor
New York, NY 10111
Attention: Dave Harrington
Telephone: (212) 632-5348
Facsimile: (212) 333-5786
BANK OF IRELAND,
as a Purchaser
By: /s/ Niamh O'Flynn
-------------------
Name: Niamh O'Flynn
-----------------
Title: Manager
----------------
Address: Bank of Ireland
La Touche House, IFSC
Custom House Quay
Dublin 1
Republic of Ireland
Attention: Niamh O'Flynn
Telephone: 00-353-1-609-3491
Facsimile: 00-353-1-829-0129
BANQUE DEGROOF,
as a Purchaser
By: /s/ Marc Giboux
----------------
Name: Marc Giboux
--------------
Title: Gerant
-------------
Address: Banque Degroof
Rue L'Industrie, 44
1040 Brussels, Belgium
Attention: Edward Bolluijt
Telephone: 32-2-287-9258
Facsimile: 32-2-230-5761
BANQUE ET CAISSE D'EPARGNE
DE L'ETAT, LUXEMBOURG, as a
Purchaser
By: /s/ Paul Guillaume
----------------------------
Name: Paul Guillaume
--------------------------
Title: Conseiller de Direction
-------------------------
Address: Banque Et Caisse D'Epargne
De L'Etat, Luxembourg
1+2 Place De Metz
L-2954 Luxembourg
Attention: Paul Guillaume
Telephone: 352-4015-4338
Facsimile: 352-4015-4284
OESTERREICHISCHE
INVESTITIONSKREDIT, AG,
as a Purchaser
By: /s/ Peter Zach
---------------
Name: Peter Zach
-------------
Title: Manager
------------
Dated: 21st May 1996
Address: Oesterreichische
Investitionskredit, AG
Renngasse 10
A-1013 Vienna
Austria
Attention: Johannes Wundsam
Telephone: 43-1-53135577
Facsimile: 43-1-53135909
SCHEDULE I
To Certificate Purchase Agreement
Series 1996-1, Class A
AMOUNT OF EACH INITIAL PURCHASER'S CERTIFICATE
----------------------------------------------
Stated Amount of Certificate
- ----------------------------
ABN AMRO Bank N.V. $18,000,000.00
Bank Austria, AG $ 3,000,000.00
Marnix Asset Funding Corp. $10,000,000.00
Bank of Ireland $ 7,000,000.00
Banque Degroof $ 3,000,000.00
Banque Et Caisse D'Epargne
De L'Etat, Luxembourg $ 5,000,000.00
Oesterreichische Investitionskredit, AG $ 4,000,000.00
Class Percentage
- ----------------
ABN AMRO Bank N.V. 36.0000000000%
Bank Austria, AG 6.0000000000%
Marnix Asset Funding Corp. 20.0000000000%
Bank of Ireland 14.0000000000%
Banque Degroof 6.0000000000%
Banque Et Caisse D'Epargne
De L'Etat, Luxembourg 10.0000000000%
Oesterreichische Investitionskredit, AG 8.0000000000%
Series Percentage
- -----------------
ABN AMRO Bank N.V. 30.0000000000%
Bank Austria, AG 5.0000000000%
Marnix Asset Funding Corp. 16.6666666667%
Bank of Ireland 11.6666666667%
Banque Degroof 5.0000000000%
Banque Et Caisse D'Epargne
De L'Etat, Luxembourg 8.3333333333%
Oesterreichische Investitionskredit, AG 6.6666666667%
EXHIBIT A
to Certificate Purchase Agreement
(Series 1996-1, Class A)
FORM OF POOLING AND SERVICING AGREEMENT
---------------------------------------
EXHIBIT B
to Certificate Purchase Agreement
(Series 1996-1, Class A)
FORM OF RECEIVABLES PURCHASE AGREEMENT
--------------------------------------
EXHIBIT C
to Certificate Purchase Agreement
(Series 1996-1, Class A)
FORM OF SERIES 1996-1 SUPPLEMENT
--------------------------------
EXHIBIT D
to Certificate Purchase Agreement
(Series 1996-1, Class A)
FORM OF ASSIGNMENT AGREEMENT
----------------------------
This ASSIGNMENT AGREEMENT, dated as of ____________ (this "Agreement"), is
made between ____________________ ("Assignor"), and _____________________
("Assignee"). Except as otherwise defined herein, capitalized terms have the
meanings assigned to them in the Certificate Purchase Agreement (as defined
below).
BACKGROUND
1. Assignor is a party to the Certificate Purchase Agreement (Series
1996-1, Class A), dated as of May 29, 1996 (as amended, supplemented or
otherwise modified from time to time, the "Certificate Purchase Agreement"),
among Notepad Funding Corporation, a Delaware corporation ("Transferor"),
American Pad & Paper Company of Delaware, Inc., a Delaware corporation, the
Purchasers party thereto (including Assignor), and ABN AMRO Bank N.V., as Agent.
2. Assignor wishes to assign, and Assignee wishes to be so assigned,
Assignor's rights and obligations arising on and after the Effective Date (as
defined below) under the Certificate Purchase Agreement and its Certificate
including (a) its obligations to make Purchases (its "Credit Exposure") and (b)
its outstanding Purchases (the "Purchases").
3. Assignor and Assignee also wish (a) Assignee to assume the obligations
of Assignor under the Certificate Purchase Agreement with respect to Assignee's
Share (as defined below) to the extent of the rights assigned and (b) Assignor
to be released from the obligations assumed by Assignee.
4. Transferor and the Agent, by their execution hereof, are providing
their written consent to the assignment accomplished by this Agreement.
SECTION 1. Assignment. Effective on the Effective Date (as defined below)
and upon payment of the amount specified in Section 3(a), Assignor hereby
assigns and transfers to Assignee, without recourse, representation or
warranty of any kind, express or implied (except as provided in Sections 6(a)
and (b)), and subject to Section 4(b), Assignee's Share (as specified in Annex I
hereto) (the "Assignee's Share") of all of Assignor's rights, title and interest
arising under (a) the Certificate Purchase Agreement relating to Assignor's
Credit Exposure including all rights and obligations with respect to the
Purchases attributable to Assignee's Share and (b) Assignor's Certificate with
respect to Assignee's Share as will result in Assignee having from and after the
Effective Date the Class Percentage ("Assignee's Percentage") specified in Annex
I.
SECTION 2. Assumption. Effective on the Effective Date, Assignee hereby
irrevocably purchases, assumes and takes from Assignor, and Assignor is hereby
expressly and absolutely released from, all of Assignor's obligations arising
under the Certificate Purchase Agreement relating to Assignee's Share and of any
outstanding Purchases attributable to Assignee's Share. Assignee hereby agrees
to be bound by the provisions of the Certificate Purchase Agreement.
SECTION 3. Payment. In consideration of the assignment by Assignor to
Assignee as set forth above, Assignee agrees to pay to Assignor, in Dollars and
in immediately available funds, (a) on or prior to the Effective Date, an amount
specified by Assignor in writing on or prior to the Effective Date that
represents Assignee's Share attributable to the principal amount of the
Purchases made pursuant to the Certificate Purchase Agreement and outstanding on
the Effective Date, and (b) from time to time thereafter, other amounts (if any)
that Assignee has agreed in writing to pay to Assignor after the Effective Date.
In consideration of the assumption by Assignee, Assignor agrees to pay to
Assignee within two Business Days of the Effective Date, an assignment fee (if
any) that previously has been agreed to in writing by both parties.
Notwithstanding anything to the contrary in this Agreement, if and when
Assignee receives or collects (x) any payment of principal or interest relating
to any Purchases or (y) any payment of fees that are required to be paid to
Assignor pursuant to this Agreement, then Assignee shall forward the payment to
Assignor.
To the extent payment of funds to Assignee or Assignor are not made within
two Business Days, each, as the case may be, shall be entitled to recover the
due amount, together with interest thereon at the Federal Funds Rate per annum
accruing from the date of payment or the date of receipt of the funds by the
other party.
Page 2
SECTION 4. Effectiveness. (a)(i) This Agreement shall become effective on
the date (the "Effective Date") on which it shall have been duly executed by all
parties and the Agent shall have recorded the information contained herein in
its records (or automatically if not so recorded within five Business Days from
the Agent's receipt of this Agreement signed by Assignor, Assignee and
Transferor). Assignor hereby notifies the Agent, Transferor and Servicer of the
assignment, effective as of the Effective Date, of Assignee's Share and any
Purchases attributable to the Assignee's Share, and directs the Agent to pay
Assignee (A) any payment of principal of, or interest on, any Purchase
attributable to the Assignee's Share of any Purchases and (B) any Non-Usage Fees
attributable to the Assignee's Share of the Credit Exposure. No (x) failure of
either Assignee or Assignor to settle any amount owed to the other (except with
respect to the payment of the processing and recordation fee to the Agent and
the payment due under Section 3(a)), (y) dispute respecting any other
settlement, including in respect of Transferor, or (z) bankruptcy, insolvency or
other condition whatsoever respecting any Person, shall in any way impair,
reduce or otherwise affect the effectiveness of this Agreement.
(ii) Assignor, Assignee and the Agent each acknowledges and agrees that
from and after the Effective Date, the Agent shall make all payments under the
Certificate Purchase Agreement in respect of Assignee's Share (including all
payments of principal, interest and Non-Usage Fees with respect thereto, whether
or not the payments shall have accrued prior to or after the Effective Date) to
Assignee only. Assignor and Assignee hereby agree further to make all
appropriate adjustments in payments to either of them under the Certificate
Purchase Agreement for periods prior to the Effective Date directly between
themselves.
(b) With respect to any Purchase attributable to Assignee's Share, if and
when Assignor receives or collects any payment of principal, interest, Non-Usage
Fees or Additional Amounts with respect to Assignee's Share for any period
commencing on or after the Effective Date, Assignor shall distribute to Assignee
the portion attributable to Assignee's Share, but only to the extent it accrued
on or after the Effective Date and was not theretofore paid to Assignee by
Transferor or otherwise. Any principal, interest, Non-Usage Fees and Additional
Amounts paid prior to the Effective Date shall be retained by Assignor. Any
principal, interest, Non-Usage Fees and Additional Amounts received by Assignee
that accrued prior to the Effective Date shall be forwarded promptly, in the
form received, to Assignor. Assignee recognizes and agrees that (i) it shall
receive no payment on account of any Agent's fees or other amounts or expenses
(including counsel fees) payable to the Agent (in such capacities and for their
own account), (ii) this Agreement shall not operate to assign any rights or
delegate any obligations of the Agent (in such
Page 3
capacities), and (iii) notwithstanding anything to the contrary in this
Agreement, Assignor shall retain all of its rights to indemnification under the
Certificate Purchase Agreement for any events, acts or omissions occurring prior
to the Effective Date.
(c) The Agent, by its execution hereof, acknowledges the assignment and
agrees to make payments in respect of principal, interest, fees and Additional
Amounts as described in clause (a).
SECTION 5. Rights as Purchaser under Certificate Purchase Agreement. In
accordance with Section 10.3 of the Certificate Purchase Agreement, (a) as of
the Effective Date, Assignee will be a Purchaser under, and party to, the
Certificate Purchase Agreement and shall have (i) all of the rights and
obligations of a Purchaser (to the extent of the assignment and assumption of
Assignee's Share effected by this Agreement) and (ii) the addresses for (A)
notice purposes and (B) LIBOR Office as set forth in items 2 and 3,
respectively, of Annex I hereto and (b) promptly on or after the Effective Date,
Transferor will execute and deliver any documents and instruments that Assignor
or Assignee reasonably may require.
SECTION 6. Representations and Warranties. (a) Each of Assignor and
Assignee represents and warrants to the other as follows:
(i) it has full power and authority, and has taken all action
necessary, to execute and deliver this Agreement, to fulfill the
obligations hereunder and to consummate the transactions contemplated
hereby,
(ii) the making and performance of this Agreement and all documents
required to be executed and delivered hereunder do not and will not violate
any law or regulation of the jurisdiction of its incorporation or any other
applicable law or regulation,
(iii) this Agreement has been duly executed and delivered and
constitutes its legal, valid and binding obligation, enforceable in
accordance with its terms, and
(iv) all approvals, authorizations or other actions by, or filing
with, any Governmental Authority necessary for the validity or
enforceability of its obligations under this Agreement have been obtained.
Page 4
(b) Assignor represents and warrants to Assignee that Assignee's Share and
the Purchases attributable to Assignee's Share are not subject to any liens or
security interests created by Assignor.
(c) Except as set forth in subsections (a) and (b), Assignor makes no
representations or warranties, express or implied, to Assignee and shall not be
responsible to Assignee for (i) the execution, effectiveness, genuineness,
legality, validity, enforceability, collectibility, regulatory status or
sufficiency of the Certificate Purchase Agreement or any of the other
Transaction Documents, (ii) the perfection, priority, value or adequacy of any
collateral security or guaranty, (iii) the taking of any action, or the failure
to take any action, with respect to any of the Transaction Documents, (iv) any
representations, warranties, recitals or statements made in any of the
Transaction Documents or in any written or oral financial or other statements,
instruments, reports, certificates or documents made or furnished by Assignor to
Assignee or by or on behalf of Transferor or any of its Affiliates to Assignor
or Assignee in connection with the Transaction Documents and the transactions
contemplated thereby, (v) the financial or other condition of Transferor or any
other Person or (vi) any other matter having any relation to any of the
foregoing. Assignor shall not be required to ascertain or inquire as to the
performance or observance of any of the terms, conditions, provisions, covenants
or agreements contained in any of the Transaction Documents or the existence or
possible existence of any Unmatured Early Amortization Event, Early Amortization
Event or Servicer Default. Additionally, Assignor shall not have any duty or
responsibility either initially or on a continuing basis to make any
investigation or any appraisal on Assignee's behalf or to provide Assignee with
any credit or other information with respect thereto, whether coming into
Assignor's possession before the execution of the Certificate Purchase Agreement
or at any time thereafter. Assignor shall have no responsibility with respect to
the accuracy of, or the completeness of, any information provided to Assignee,
whether by Assignor or by or on behalf of Transferor or any other Person
obligated under the Certificate Purchase Agreement or any related instrument or
document.
(d) Assignee represents and warrants that (x) it has made its own
independent investigation of each of the foregoing matters, including the
financial condition and affairs of Transferor and its Affiliates, in connection
with the making of the Purchases and the execution of this Agreement (including
the solvency of Transferor and its Affiliates, their ability to pay their
respective debts as they mature and the capital of Transferor and its Affiliates
remaining after the closing under the Transaction Documents and the consummation
of the transactions contemplated thereby) and has made and shall continue to
make its own appraisal of the creditworthiness of Transferor
Page 5
and its Affiliates, and (y) the representations and warranties set forth in
Section 6.3 of the Agreement are true and correct with respect to the Assignee.
Assignee (i) confirms that it has received copies of the Transaction Documents
together with copies of certain other closing documents delivered in connection
with the Certificate Purchase Agreement, financial statements and any other
documents and information that it has requested or deemed appropriate to make
its own credit analysis and decision to enter into this Agreement and (ii)
agrees that it will, independently and without reliance upon the Agent, Assignor
or any other Purchaser and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Transaction Documents.
SECTION 7. No Proceedings. Assignee hereby agrees to be bound by the
provisions of Section 10.13 of the Certificate Purchase Agreement.
SECTION 8. [Withholding Taxes. In accordance with Section 4.6 of the
Certificate Purchase Agreement, Assignee agrees to execute and deliver to the
Agent, for delivery to Transferor, on or before the Effective Date, (a) an
Internal Revenue Service Form 1001 or 4224 or successor applicable form,
properly completed and duly executed by the Purchaser certifying that it is
entitled to receive payments under the Certificate Purchase Agreement without
deduction or withholding of any United States Federal income taxes, and (b) an
original copy of Internal Revenue Service Form W-8 or W-9 or applicable
successor form, properly completed and duly executed. Assignee represents and
warrants to Transferor and Assignor that, as of the Effective Date, it shall be
entitled to receive payments of principal and interest under its Certificate and
hereunder without deduction for or on account of any taxes imposed by the United
States of America or any political subdivision thereof. In the event that, after
delivering the applicable form, Assignee shall cease to be exempt from
withholding and/or deduction of taxes, then the Agent may withhold and/or deduct
the applicable amount from any payments of principal, interest and any fees to
which Assignee otherwise would be entitled, and the Agent shall have no
liability whatsoever to Assignee for any such withholding or deduction. Assignee
shall indemnify Transferor and the Agent from and against all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs or
expenses that result from Assignee's breach of such representation and
warranty./*/
SECTION 9. ]Miscellaneous. (a) Each of the parties hereto agrees to take
any action and execute and deliver any documents that any party hereto
- --------------------------
/*/ If the Assignee is a foreign entity.
Page 6
reasonably may request from time to time in order to implement more fully the
purposes of this Agreement. Without limiting the generality of the foregoing,
Assignor and Assignee will cooperate in obtaining for Assignee a Certificate (as
well as a replacement Certificate for Assignor representing any retained
interest of Assignor).
(b) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES.
(c) Except as otherwise set forth herein, this Agreement sets forth the
entire agreement between the parties relating to the subject matter hereof, and
no term or provision of this Agreement may be amended, changed, waived,
discharged or terminated orally or otherwise, except in a writing signed by
Assignor and Assignee.
(d) This Agreement may be executed in any number of counterparts and by
the different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which together shall
constitute one and the same instrument.
(e) Each of the parties hereto agrees that each party shall bear its own
expenses in connection with the preparation and execution of this Agreement and
the consummation of the Assignment described herein. Assignee further agrees
that it shall send a check in the amount of $[1,500] [3,500] to the Agent on or
prior to the Effective Date, as payment of the processing and recordation fee
described in Section 10.3(c) of the Certificate Purchase Agreement.
(f) All representations and warranties made, and indemnities provided for,
herein shall survive the consummation of the transactions contemplated hereby.
(g) Assignor may at any time or from time to time grant assignments and
participations in its rights and obligations under the Certificate Purchase
Agreement and its Certificate to other Persons, but not in the portions thereof
assigned to Assignee.
(h) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Neither Assignor nor
Assignee may assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of the other party. The preceding
Page 7
sentence shall not limit the right of Assignee to assign all or part of
Assignee's Share in the manner contemplated by the Certificate Purchase
Agreement.
(i) Assignee acknowledges that all obligations of the Agent are subject to
Article IX of the Certificate Purchase Agreement.
Page 8
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their duly authorized officers and delivered as of the day and
year first above written.
---------------------------------,
as Assignor
By:
------------------------------
Title:
---------------------------
---------------------------------,
as Assignee
By:
------------------------------
Title:
---------------------------
The undersigned hereby acknowledges the terms and provisions of this
Agreement, and agrees to make payments in respect of principal, interest and
fees as described in Section 4(a).
ABN AMRO BANK N.V., as Agent
By:
-------------------------
Title:
--------------------
NOTEPAD FUNDING CORPORATION
By:
-------------------------
Title:
--------------------
Page 9
ANNEX I
to Assignment Agreement
ITEM 1. ASSIGNEE'S SHARE:
(a) Assignee's Stated Amount $______________
(b) Assignee's Percentage _____________%
ITEM 2. ADDRESS OF ASSIGNEE FOR NOTICE PURPOSES:
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- ----------------------------
- ----------------------------
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- ----------------------------
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Attention:
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Telephone:
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Facsimile:
- ----------------------------
ITEM 3. LIBOR OFFICE OF ASSIGNEE:
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- ----------------------------
- ----------------------------
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APPENDIX X
to Certificate Purchase Agreement
(Series 1996-1, Class A)
INDEX OF ADDITIONAL DEFINED TERMS
---------------------------------
Agents....................................................................... 1
Agreement.................................................................... 1
APP.......................................................................... 1
Certificates................................................................. 1
Class Percentage............................................................. 2
Credit Exposure.............................................................. 24
Designated Agent............................................................. 2
Financial Advisors........................................................... 13
Indemnitees.................................................................. 26
LIBOR Office................................................................. 7
Non-Usage Fee................................................................ 6
Participants................................................................. 24
Pooling Agreement............................................................ 1
Purchase..................................................................... 2
Purchasers................................................................... 1
Receivables Review........................................................... 19
Required Purchasers.......................................................... 23
Series Percentage............................................................ 2
Servicer..................................................................... 1
Stated Amount................................................................ 4
Supplement................................................................... 1
Taxes........................................................................ 10
Transferee................................................................... 25
Transferor................................................................... 1
Trust........................................................................ 1
Trust Interest............................................................... 1
Trustee...................................................................... 1