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Exhibit 10.8
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
among
ENTERPRISE FUNDING CORPORATION,
as a Conduit Investor
COMPASS US ACQUISITION, LLC,
as a Conduit Investor
NMC FUNDING CORPORATION
as Transferor
NATIONAL MEDICAL CARE, INC.,
as Collection Agent
THE FINANCIAL INSTITUTIONS PARTIES HERETO,
as Bank Investors
WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH,
as an Administrative Agent
and
BANK OF AMERICA, N.A.
as an Administrative Agent and as Agent
Dated as of September 27, 1999
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TABLE OF CONTENTS
SECTION 2.3. Selection of Tranche Periods and Tranche Rates. 37
SECTION 6.2. Duties of Collection Agent. 70
SECTION 9.7. Bank Commitment; Assignment to Bank Investors. 89
SECTION 10.4. Governing Law; Submission to Jurisdiction; Integration. 98
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EXHIBITS
EXHIBIT A Forms of Contracts
EXHIBIT B Credit and Collection Policies and Practices
EXHIBIT C List of Special Account Banks, Designated Account Agents and
Concentration Bank
EXHIBIT D-1 Form of Special Account Letter
EXHIBIT D-2 Form of Concentration Account Agreement
EXHIBIT E Form of Investor Report
EXHIBIT F Form of Transfer Certificate
EXHIBIT G Form of Assignment and Assumption Agreement
EXHIBIT H List of Actions and Suits (Sections 3.1(g), 3.1(k) and 3.3(e))
EXHIBIT I Location of Records
EXHIBIT J [RESERVED]
EXHIBIT K Forms of Opinions of Counsel
EXHIBIT L Forms of Secretary's Certificate
EXHIBIT M Form of Certificate
EXHIBIT N List of Approved Fiscal Intermediaries
EXHIBIT O Form of Transferring Affiliate Letter
EXHIBIT P Form of Parent Agreement
EXHIBIT Q List of Transferring Affiliates
EXHIBIT R Form of Account Agent Agreement
EXHIBIT S List of Closing Documents
EXHIBIT T Form of Amendment to Parent Agreement
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AMENDED AND RESTATED TRANSFER AND ADMINISTRATION AGREEMENT
AMENDED AND RESTATED TRANSFER AND ADMINISTRATION AGREEMENT (this
"Agreement"), dated as of September 27, 1999, by and among NMC FUNDING
CORPORATION, a Delaware corporation, as transferor (in such capacity, the
"Transferor"), NATIONAL MEDICAL CARE, INC., a Delaware corporation, as the
initial "Collection Agent", ENTERPRISE FUNDING CORPORATION, a Delaware
corporation ("Enterprise"), COMPASS US ACQUISITION, LLC, a Delaware limited
liability company ("Compass"), the FINANCIAL INSTITUTIONS PARTIES HERETO, as
Bank Investors, WESTDEUTSCHE LANDESBANK GIROZENTRALE, NEW YORK BRANCH
("WestLB"), as an Administrative Agent and BANK OF AMERICA, N.A., a national
banking association ("Bank of America"), as an Administrative Agent and as agent
(in such capacity, the "Agent") for Compass, Enterprise and the Bank Investors.
PRELIMINARY STATEMENTS
WHEREAS, the Transferor, the Collection Agent, Enterprise, the Bank
Investors and Bank of America (as successor to NationsBank, N.A.), as agent, are
parties to that certain Transfer and Administration Agreement dated as of August
28, 1997 (as amended prior to the date hereof, the "Existing TAA"); and
WHEREAS, the parties hereto desire to amend and restate the Existing
TAA in its entirety.
NOW, THEREFORE, the parties hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Certain Defined Terms. As used in this Agreement,
the following terms shall have the following meanings:
"Account Agent Agreement" means an agreement in substantially the
form of Exhibit R hereto.
"Administrative Agent" means (i) Bank of America as administrative
agent for the Related Group that includes Enterprise or (ii) WestLB, as
administrative agent for the Related Group that includes Compass.
"Administrative Fee" means the fee payable by the Transferor to
Enterprise pursuant to Section 2.7(a) hereof, the terms of which are set forth
in the Fee Letter to which Enterprise is a party.
"Adverse Claim" means a lien, security interest, charge or
encumbrance, or other right or claim in, of or on any Person's assets or
properties in favor of any other Person
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(including any UCC financing statement or any similar instrument filed against
such Person's assets or properties).
"Affected Assets" means, collectively, the Receivables and the
Related Security, Collections and Proceeds relating thereto.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with, such Person. A Person shall be deemed to control another
Person if the controlling Person possesses, directly or indirectly, the power to
direct or cause the direction of the management or policies of the controlled
Person, whether through ownership of voting stock, by contract or otherwise.
"Agent" means Bank of America, in its capacity as agent for the
Investors, and any successor thereto appointed pursuant to Article IX.
"Aggregate Unpaids" means, at any time, an amount equal to the sum
of (i) the aggregate accrued and unpaid Discount with respect to all Tranche
Periods at such time, (ii) the Net Investment at such time, and (iii) all other
amounts owed (whether due or accrued) hereunder by the Transferor to the
Investors at such time.
"Agreement" shall have the meaning specified in the Preamble to
this Agreement.
"Applicable Margin" means, for purposes of calculating the
Eurodollar Rate for any Eurodollar Tranche Period, the applicable margin
corresponding to the Consolidated Leverage Ratio (as such term is defined in the
Parent Agreement) set forth below as determined as of the last day of the month
then most recently ended for which an Investor Report shall have been delivered
to each Administrative Agent:
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Consolidated
Leverage Applicable Margin
Ratio
------------ -----------------
0.450%
<1.75
0.500%
greater than or equal to 1.75 but < 2.0
0.625%
greater than or equal to 2.0 but < 2.5
0.875%
greater than or equal to 2.50 but < 3.0
1.000%
greater than or equal to 3.0 but < 3.25
1.250%
greater than or equal to 3.25 but < 3.75
1.375%
greater than or equal to 3.75 but < 4.0
1.500%
greater than or equal to 4.0 but < 4.25
1.750%
greater than or equal to 4.25
The Applicable Margin shall be determined on each date that an Investor Report
shall be delivered by the Transferor or the Collection Agent to each
Administrative Agent and such Applicable Margin shall remain in effect until the
date upon which the next Investor Report shall have been so delivered to each
Administrative Agent, at which time the Applicable Margin shall be redetermined
in accordance with the Consolidated Leverage Ratio reported at such time.
"Assignment Amount" with respect to a Bank Investor shall mean at
any time an amount equal to the lesser of (i) such Bank Investor's Pro Rata
Share of the Net Investment held by the Conduit Investor in the same Related
Group at such time and (ii) such Bank Investor's unused Commitment.
"Assignment and Assumption Agreement" means an Assignment and
Assumption Agreement substantially in the form of Exhibit G attached hereto.
"Auditor" shall have the meaning specified in Section 6.2(c).
"Bank of America" means Bank of America, N.A., together with its
successors and assigns.
"Bank Investors" shall mean Bank of America, N.A., WestLB and each
other financial institution identified as such on the signature pages hereof and
their respective successors and assigns.
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"Bank Revolver" means that certain Credit Agreement dated as of
September 27, 1996, among NMC and certain subsidiaries and affiliates as
borrowers, certain subsidiaries and affiliates as guarantors, the lenders named
therein, Bank of America, N.A., as paying agent, and The Bank of Nova Scotia,
The Chase Manhattan Bank, Dresdner Bank AG, New York and Grand Cayman Branches,
and Bank of America, N.A. as managing agents.
"Bankruptcy Code" means the United States Bankruptcy Code, 11
U.S.C. Section 101 et seq., as amended.
"Base Rate" or "BR" means, with respect to the Investors in any
Related Group, a rate per annum equal to the greater of (i) the prime rate of
interest announced by the Administrative Agent for such Related Group from time
to time, changing when and as said prime rate changes (such rate not necessarily
being the lowest or best rate charged by such Administrative Agent) and (ii) the
sum of (a) 1.50% and (b) the rate equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such transactions
received by such Administrative Agent from three Federal funds brokers of
recognized standing selected by it.
"Benefit Plan" means any employee benefit plan as defined in Section
3(3) of ERISA in respect of which the Transferor, the Seller or any ERISA
Affiliate of the Transferor or the Seller is, or at any time during the
immediately preceding six years was, an "employer" as defined in Section 3(5) of
ERISA.
"BMA" means Bio-Medical Applications Management Company, Inc., a
Delaware corporation, and its successors and permitted assigns.
"BMA Transfer Agreement" means that certain Receivables Purchase
Agreement of even date herewith by and between BMA, as seller, and NMC, as
purchaser, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"Business Day" means any day excluding Saturday, Sunday and any day
on which banks in New York, New York or Charlotte, North Carolina are authorized
or required by law to close, and, when used with respect to the determination of
any Eurodollar Rate or any notice with respect thereto, any such day which is
also a day for trading by and between banks in United States dollar deposits in
the London interbank market.
"BR Tranche" means a Tranche as to which Discount is calculated
at the Base Rate.
"BR Tranche Period" means, with respect to a BR Tranche for the
Investors in any Related Group, either (i) prior to the Termination Date, a
period of up to 30 days requested by the Transferor and agreed to by the
Administrative Agent for such Related Group, commencing on a Business Day
requested by the Transferor and agreed to by such Administrative Agent, or (ii)
after the Termination Date, a period of one day. If such BR
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Tranche Period would end on a day which is not a Business Day, such BR Tranche
Period shall end on the next succeeding Business Day.
"Capitalized Lease" of a Person means any lease of property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP.
"Certificate" means the certificate issued to the Agent for the
benefit of the Investors pursuant to Section 2.2(d) of the Existing TAA.
"CHAMPUS/VA" means, collectively, (i) the Civilian Health and
Medical Program of the Uniformed Service, a program of medical benefits covering
retirees and dependents of a member or a former member of a uniformed service,
provided, financed and supervised by the United States Department of Defense and
established by 10 USC Section 1071 et seq. and (ii) the Civilian Health and
Medical Program of Veterans Affairs, a program of medical benefits covering
dependents of veterans, administered by the United States Veterans'
Administration and Department of Defense and established by 38 USC Section 1713
et seq.
"CHAMPUS/VA Regulations" means collectively, all regulations of the
Civilian Health and Medical Program of the Uniformed Services and the Civilian
Health and Medical Program of Veterans Affairs, including (a) all federal
statutes (whether set forth in 10 USC 1071, 38 USC 1713 or elsewhere) affecting
CHAMPUS/VA; and (b) all applicable provisions of all rules, regulations
(including 32 CFR 199 and 38 CFR 17.54), manuals, orders, and administrative,
reimbursement and other guidelines of all Governmental Authorities (including,
without limitation, HHS, the Department of Defense, the Veterans'
Administration, the Department of Transportation, the Assistant Secretary of
Defense (Health Affairs), and the Office of CHAMPUS, or any Person or entity
succeeding to the functions of any of the foregoing) promulgated pursuant to or
in connection with any of the foregoing (whether or not having the force of
law), in each case as may be amended, supplemented or otherwise modified from
time to time.
"Closing Date" means September 27, 1999.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral Agent" means (i) with respect to the Related Group that
includes Enterprise, Bank of America,, as collateral agent for any related
Liquidity Provider, any related Credit Support Provider, the holders of
Commercial Paper issued by Enterprise and certain other parties and (ii) with
respect to the Related Group that includes Compass, Westdeutsche Landesbank
Girozentrale, as collateral agent for any related Liquidity Provider, any
related Credit Support Provider, the holders of Commercial Paper issued by
Compass or its Related CP Issuer and certain other parties.
"Collection Account" means the account, established by the Agent,
for the benefit of the Investors, pursuant to Section 2.12.
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"Collection Agent" means at any time the Person then authorized
pursuant to Section 6.1 to service, administer and collect Receivables.
"Collection Agent Default" has the meaning specified in Section
6.4 hereof.
"Collections" means, with respect to any Receivable, all cash
collections and other cash proceeds of such Receivable, including, without
limitation, all Finance Charges, if any, and cash proceeds of Related Security
with respect to such Receivable.
"Collection Delay Period" means 10 days or such other number of days
as the Agent may select upon three Business Days' notice to the Transferor.
"Commercial Obligor" means any Obligor referred to in clause (C) or
(E) of the definition of "Obligor" contained in this Section 1.1 hereof.
"Commercial Paper" means, with respect to any Conduit Investor, the
promissory notes issued by such Conduit Investor or its Related CP Issuer in the
commercial paper market.
"Commitment" means (i) with respect to each Bank Investor party
hereto, the commitment of such Bank Investor to make acquisitions from the
Transferor or the Conduit Investor in its Related Group in accordance herewith
in an amount not to exceed the dollar amount set forth opposite such Bank
Investor's signature on the signature page hereto under the heading
"Commitment", minus the dollar amount of any Commitment or portion thereof
assigned pursuant to an Assignment and Assumption Agreement plus the dollar
amount of any increase to such Bank Investor's Commitment consented to by such
Bank Investor prior to the time of determination, (ii) with respect to any
assignee of a Bank Investor party hereto taking pursuant to an Assignment and
Assumption Agreement, the commitment of such assignee to make acquisitions from
the Transferor or the Conduit Investor in its Related Group not to exceed the
amount set forth in such Assignment and Assumption Agreement minus the dollar
amount of any Commitment or portion thereof assigned pursuant to an Assignment
and Assumption Agreement prior to such time of determination and (iii) with
respect to any assignee of an assignee referred to in clause (ii), the
commitment of such assignee to make acquisitions from the Transferor or the
Conduit Investor in its Related Group not to exceed the amount set forth in an
Assignment and Assumption Agreement between such assignee and its assign.
"Commitment Termination Date" means September 25, 2000, or such
later date to which the Commitment Termination Date may be extended by
Transferor, the Agent and the Bank Investors not later than 60 days prior to the
then current Commitment Termination Date.
"Compass" means Compass US Acquisition, LLC, a Delaware limited
liability company, together with its successors and permitted assigns.
"Concentration Account" means a special depositary account in the
name of the Transferor maintained at a bank acceptable to the Agent for the
purpose of receiving Collections remitted from the Special Accounts.
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"Concentration Account Agreement" means an agreement substantially
in the form attached as Exhibit D-2 hereto among the Transferor, the
Concentration Account Bank and the Agent.
"Concentration Account Bank" means the bank holding the
Concentration Account.
"Concentration Account Notice" means a notice, in substantially the
form of the Notice of Effectiveness attached to the Concentration Account
Agreement, from the Agent to the Concentration Account Bank.
"Concentration Factor" means for any Designated Obligor on any date
of determination (calculated prior to the payment of any Transfer Price to be
made on such date but as if such payment had been made): (a) in the case of each
Commercial Obligor and each Hospital Obligor, 5% of the Net Investment
outstanding on such date; (b) in the case of each US Government Obligor, 80% of
the Net Investment outstanding on such date, or (c) in the case of any Obligor
(including any of the foregoing), such higher amount determined by the Agent
(with the consent of each Administrative Agent) or such lower amount determined
by any Administrative Agent in the reasonable exercise of its good faith
judgment and disclosed in a written notice delivered to the Transferor and the
other Administrative Agent.
"Conduit Investor" means Compass or Enterprise.
"Confidential Information" shall have the meaning specified in
Section 5.1(d).
"Contract" means an agreement between an Originating Entity and an
Obligor which (i) if in writing, is in substantially the form of one of the
forms of written contract set forth in Exhibit A hereto or otherwise approved by
each Administrative Agent, and (ii) if an open account agreement, is evidenced
by one of the forms of invoices set forth in Exhibit A hereto or otherwise
approved by each Administrative Agent, in each case pursuant to or under which
such Obligor shall be obligated to pay for services or merchandise from time to
time.
"Contractual Adjustment" means, with respect to any Receivable, an
amount by which the Outstanding Balance of such Receivable is reduced as a
result of (i) Medicare or Medicaid program funding and fee requirements or (ii)
any other reasonable and customary insurance company or other charge or
reimbursement policies or procedures.
"CP Rate" means, with respect to any CP Tranche Period for any
Conduit Investor, the rate equivalent to the rate (or if more than one rate, the
weighted average of the rates) at which Commercial Paper of such Conduit
Investor or its Related CP Issuer having a term equal to such CP Tranche Period
may be sold by any placement agent or commercial paper dealer selected by such
Conduit Investor or such Related CP Issuer, provided, however, that if the rate
(or rates) as agreed between any such agent or dealer and such Conduit Investor
or its Related CP Issuer is a discount rate, then the rate (or if more than one
rate, the weighted average of the rates) resulting from such Conduit Investor's
converting such discount rate (or rates) to an interest-bearing equivalent rate
per annum.
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"CP Tranche" means a Tranche as to which Discount is calculated
at a CP Rate.
"CP Tranche Period" means, with respect to a CP Tranche for any
Conduit Investor, a period of days not to exceed 90 days commencing on a
Business Day requested by the Transferor and agreed to by such Conduit Investor
pursuant to Section 2.3. If a CP Tranche Period would end on a day which is not
a Business Day, such CP Tranche Period shall end on the next succeeding Business
Day.
"Credit and Collection Policy" shall mean the Transferor's credit
and collection policy or policies and practices, relating to Contracts and
Receivables existing on the date hereof and referred to in Exhibit B attached
hereto, as modified from time to time in compliance with Section 5.2(c).
"Credit Support Agreement" means, with respect to any Conduit
Investor, an agreement between such Conduit Investor or its Related CP Issuer
and a Credit Support Provider evidencing the obligation of such Credit Support
Provider to provide credit support to such Conduit Investor or its Related CP
Issuer in connection with the issuance by such Conduit Investor or its Related
CP Issuer of Commercial Paper.
"Credit Support Provider" means, with respect to any Conduit
Investor, the Person or Persons who provides credit support to such Conduit
Investor or its Related CP Issuer in connection with the issuance by such
Conduit Investor or such Related CP Issuer of Commercial Paper.
"Dealer Fee" means, with respect to any Conduit Investor, the fee
payable by the Transferor to the related Administrative Agent, pursuant to
Section 2.4 hereof, the terms of which are set forth in the Fee Letter to which
such Conduit Investor is a party.
"Deemed Collections" means any Collections on any Receivable deemed
to have been received pursuant to Section 2.9(a) or (b) hereof.
"Defaulted Receivable" means a Receivable: (i) as to which any
payment, or part thereof, remains unpaid for over 270 days from the original due
date for such Receivable; (ii) as to which an Event of Bankruptcy has occurred
and is continuing with respect to the Obligor thereof; (iii) which has been
identified by the Transferor, any Originating Entity or the Collection Agent as
uncollectible; or (iv) which, consistent with the Credit and Collection Policy,
should be written off as uncollectible.
"Default Ratio" means the ratio (expressed as a percentage) computed
as of the last day of each calendar month by dividing (i) the aggregate
Outstanding Balance of all Receivables that became Defaulted Receivables during
such month together with all Receivables under the Medicare or Medicaid Program
that were deemed disputed as provided for in the proviso to clause (xi) of the
definition of "Eligible Receivables" during such month, by (ii) the aggregate
Outstanding Balance of Receivables that shall have been acquired by the Seller
during the month occurring nine months prior to such calendar month.
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"Delinquent Receivable" means a Receivable: (i) as to which any
payment, or part thereof, remains unpaid for more than 90 days from the
original due date for such Receivable and (ii) which is not a Defaulted
Receivable.
"Designated Account Agent" means, in the case of any Originating
Entity, an Affiliate thereof that (i) is, directly or indirectly, a wholly-owned
Subsidiary of FMCH, (ii) has agreed to maintain a deposit account for the
benefit of such Originating Entity to which Obligors in respect of such
Originating Entity have been directed to remit payments on Receivables, and
(iii) shall have executed and delivered to the Agent an Account Agent Agreement.
"Designated Obligor" means, at any time, each Obligor; provided,
however, that any Obligor shall cease to be a Designated Obligor upon notice to
the Transferor from any Administrative Agent, delivered at any time (with a copy
to the other Administrative Agent).
"Dilution Horizon" means the ratio (expressed as a percentage)
computed as of the last day of each calendar month by dividing (i) the aggregate
Outstanding Balance of all Receivables acquired by the Transferor during the
calendar month preceding such calendar month by (ii) the Net Receivables Balance
as of such last day of such calendar month.
"Dilution Ratio" means, with respect to any calendar month, the
greater of (a) the ratio (expressed as a percentage) computed as of the last day
of such calendar month by dividing (i) the aggregate amount of any Receivables
that are reduced or canceled as a result of any defective, rejected or returned
merchandise or services and all credits, rebates, discounts, disputes, warranty
claims, repossessed or returned goods, chargebacks, allowances and any other
billing and other adjustment (whether effected through the granting of credits
against the applicable Receivables or by the issuance of a check or other
payment in respect of (and as payment for) such reduction) by the Seller, the
Transferor or the Collection Agent, provided to Obligors in respect of
Receivables during such month by (ii) the aggregate Outstanding Balance of all
Receivables which arose during the preceding month and (b) 3.0%.
"Dilution Reserve" means, at any time, an amount equal to the
product of (i) the Dilution Reserve Percentage and (ii) the Net Receivables
Balance on such date.
"Dilution Reserve Percentage" means, on any day, an amount equal to:
[ ( 1.5 x ADR ) + [( DS - ADR ) x ( DS / ADR)] ] x DH
Where:
ADR = the average Dilution Ratio in respect of the 12 calendar month
period then most recently ended.
DS = the highest Dilution Ratio at any time during the 12 calendar month
period then most recently ended.
DH = the Dilution Horizon on such date.
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"Discount" means, with respect to any Tranche Period:
(TR x TNI x AD)
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360
Where:
TR = the Tranche Rate applicable to such Tranche Period.
TNI = the portion of the Net Investment allocated to such Tranche Period.
AD = the actual number of days during such Tranche Period.
provided, however, that no provision of this Agreement shall require the payment
or permit the collection of Discount in excess of the maximum amount permitted
by applicable law; and provided, further, that Discount shall not be considered
paid by any distribution if at any time such distribution is rescinded or must
be returned for any reason.
"Discount Reserve" means, at any time, an amount equal to:
TD + LY
Where:
TD = the sum of the unpaid Discount for all Tranche Periods.
LY = the Liquidation Yield
"Early Collection Fee" means, for any Tranche Period (such Tranche
Period to be determined without regard to the last sentence in Section 2.3(a)
hereof) during which the portion of the Net Investment that was allocated to
such Tranche Period is reduced for any reason whatsoever, the excess, if any, of
(i) the additional Discount that would have accrued during such Tranche Period
if such reductions had not occurred, minus (ii) the income, if any, received by
the recipient of such reductions from investing the proceeds of such reductions.
"Eligible Investments" means any of the following (a) negotiable
instruments or securities represented by instruments in bearer or registered or
in book-entry form which evidence (i) obligations fully guaranteed by the United
States of America; (ii) time deposits in, or bankers acceptances issued by, any
depositary institution or trust company incorporated under the laws of the
United States of America or any state thereof and subject to supervision and
examination by Federal or state banking or depositary institution authorities;
provided, however, that at the time of investment or contractual commitment to
invest therein, the certificates of
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deposit or short-term deposits, if any, or long-term unsecured debt obligations
(other than such obligation whose rating is based on collateral or on the credit
of a Person other than such institution or trust company) of such depositary
institution or trust company shall have a credit rating from Moody's and S&P of
at least "P-1" and "A-1", respectively, in the case of the certificates of
deposit or short-term deposits, or a rating not lower than one of the two
highest investment categories granted by Moody's and by S&P; (iii) certificates
of deposit having, at the time of investment or contractual commitment to invest
therein, a rating from Moody's and S&P of at least "P-1" and A-1", respectively;
or (iv) investments in money market funds rated in the highest investment
category or otherwise approved in writing by the applicable rating agencies; (b)
demand deposits in any depositary institution or trust company referred to in
(a)(ii) above; (c) commercial paper (having original or remaining maturities of
no more than 30 days) having, at the time of investment or contractual
commitment to invest therein, a credit rating from Moody's and S& P of at least
"P-1" and "A-1", respectively; and (e) repurchase agreements involving any of
the Eligible Investments described in clauses (a)(i), (a)(iii) and (d) hereof so
long as the other party to the repurchase agreement has at the time of
investment therein, a rating from Moody's and S&P of at least "P-1" and "A-1",
respectively.
"Eligible Receivable" means, at any time, any Receivable:
(i) which has been (A) originated by the Seller or a Transferring
Affiliate, (B) sold by the applicable Transferring Affiliate to the Seller
pursuant to (and in accordance with) the Transferring Affiliate Letter or the
BMA Transfer Agreement, free and clear of any Adverse Claim, in the case of a
Receivable originated by a Transferring Affiliate, and (C) sold to the
Transferor pursuant to (and in accordance with) the Receivables Purchase
Agreement, with the effect that the Transferor has good title thereto, free and
clear of all Adverse Claims;
(ii) which (together with the Collections and Related Security
related thereto) has been the subject of either a valid transfer and assignment
from the Transferor to the Agent, on behalf of the Investors, of all of the
Transferor's right, title and interest therein or the grant of a first priority
perfected security interest herein (and in the Collections and Related Security
related thereto), effective until the termination of this Agreement;
(iii) the Obligor of which (A) is a United States resident, (B) is a
Designated Obligor at the time of the initial creation of an interest therein
hereunder, (C) is not an Affiliate of any Originating Entity or any of the
parties hereto, (D) other than in the case of any Obligor of the type described
in clause (A), (B) or (F) of the definition herein of "Obligor", is not a
government or a governmental subdivision or agency and (E) is not referred to in
clause (G) of the definition herein of "Obligor";
(iv) which is not a Defaulted Receivable at the time of the initial
creation of an interest therein hereunder;
(v) which is not a Delinquent Receivable at the time of the initial
creation of an interest of the Agent or any Investor therein;
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(vi) which, (A) arises pursuant to a Contract with respect to which
each of the Seller and the Transferor has performed all obligations required to
be performed by it thereunder, including without limitation shipment of the
merchandise and/or the performance of the services purchased thereunder; (B) has
been billed in accordance with the Credit and Collection Policy and in
accordance with such requirements (including any requirements that relate to the
timing of billing) as may have been imposed by the applicable Obligor thereon
(including, without limitation, any Official Body associated with any of the
CHAMPUS/VA, Medicaid or Medicare programs); and (C) according to the Contract
related thereto, is required to be paid in full upon receipt by the Obligor
thereof of the invoice related thereto or at a later time not to exceed 90 days
from the original billing date therefor;
(vii) which is an "eligible asset" as defined in Rule 3a-7 under the
Investment Company Act of 1940, as amended;
(viii) a purchase of which with the proceeds of Commercial Paper
would constitute a "current transaction" within the meaning of Section 3(a)(3)
of the Securities Act of 1933, as amended;
(ix) which is an "account" or "general intangible" within the
meaning of Article 9 of the UCC of all applicable jurisdictions;
(x) which is denominated and payable only in United States dollars
in the United States;
(xi) which, (A) arises under a Contract that has been duly
authorized and that, together with the Receivable related thereto, is in full
force and effect and constitutes the legal, valid and binding obligation of the
related Obligor enforceable against such Obligor in accordance with its terms,
(B) is not subject to any litigation, dispute, counterclaim or other defense and
(C) is not subject to any offset other than as set forth in the related
Contract; provided, however, that for the purposes of this clause (xi), any
Receivable under the Medicare, Medicaid or CHAMPUS/VA program as to which any
payment, or part thereof, remains unpaid for 270 days or more from the original
invoice date shall be deemed to be a disputed Receivable and, further, any
Receivable, for which the Transferor receives a partial payment that is below
the estimated value of such Receivable, net of Contractual Adjustments, shall be
deemed to be a disputed Receivable;
(xii) which, together with the Contract related thereto, does not
contravene in any material respect any laws, rules or regulations applicable
thereto (including, without limitation, (A) laws, rules and regulations relating
to healthcare, insurance, usury, consumer protection, truth in lending, fair
credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy and (B) CHAMPUS/VA Regulations, Medicare
Regulations and Medicaid Regulations) and with respect to which no part of the
Contract related thereto is or would, as a result of any of the transactions
contemplated herein, be in violation of any such law, rule or regulation in any
material respect and with respect to which no Originating Entity or the
Transferor, and to the best knowledge of the Seller and the Transferor, no other
party to the
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Contract related thereto, is in violation of any such law, rule or regulation in
any material respect;
(xiii) which (A) satisfies all applicable requirements of the Credit
and Collection Policy, (B) is assignable as contemplated under the Transaction
Documents, and (C) complies with such other criteria and requirements as any
Administrative Agent may from time to time specify to the Transferor following
five Business Days' notice;
(xiv) which was generated in the ordinary course of an Originating
Entity's business;
(xv) the Obligor of which has been directed to make all payments to
a Special Account with respect to which there shall be a Special Account Letter
(and, if applicable, an Account Agent Agreement) in effect;
(xvi) neither the assignment of which under the Transferring
Affiliate Letter or the BMA Transfer Agreement by the applicable Transferring
Affiliate, the assignment of which under the Receivables Purchase Agreement by
the Seller and the assignment of which hereunder by the Transferor nor the
performance or execution of any of the other transactions contemplated in any of
the Transaction Documents with respect thereto violates, conflicts or
contravenes any applicable laws, rules or regulations (including without
limitation, any CHAMPUS/VA Regulations, any Medicaid Regulations and any
Medicare Regulations), orders or writs or any contractual or other restriction,
limitation or encumbrance;
(xvii) which has not been compromised, adjusted or modified
(including by the extension of time for payment or the granting of any
discounts, allowances or credits); provided, however, that only such portion of
such Receivable that is the subject of such compromise, adjustment or
modifications shall be deemed to be ineligible pursuant to the terms of this
clause (xvii);
(xviii) which, in the case of any Receivable payable by an Obligor
through a fiscal intermediary or similar entity, is payable through one of the
Persons in such capacity that is specified in Exhibit N hereto or that has
otherwise been approved by each Administrative Agent;
(xix) as to which, in the case of any Obligor of the type described
in clause (C) or (D) of the definition of "Obligor" herein, notice of the
interest therein of the Transferor shall have been given to such Obligor; and
(xx) which, in the case of any Receivable arising from a sale of
services or merchandise by (A) NMC Homecare, Inc. or National Medical Care Home
Care Service Agency, Inc., such Receivable shall have been billed through either
the "AS 400" billing system or the "Mesta" system or (B) NMC Diagnostic
Services, Inc., such Receivable shall have been billed through the "IDX" billing
system or, in any such case, through any successor billing system described to
each Administrative Agent by the Seller or the Transferor and approved by each
Administrative Agent from time to time.
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"Enterprise" means Enterprise Funding Corporation, a Delaware
corporation, together with its successors and permitted assigns.
"ERISA" means the U.S. Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA Affiliate" means, with respect to any Person, (i) any
corporation which is a member of the same controlled group of corporations
(within the meaning of Section 414(b) of the Code (as in effect from time to
time, the "Code")) as such Person; (ii) a trade or business (whether or not
incorporated) under common control (within the meaning of Section 414(c) of the
Code) with such Person; or (iii) a member of the same affiliated service group
(within the meaning of Section 414(n) of the Code) as such Person, any
corporation described in clause (i) above or any trade or business described in
clause (ii) above.
"Estimated Maturity Period" shall mean, at any time, the period,
rounded upward to the nearest whole number of days, equal to the weighted
average number of days until due of the Receivables as calculated by the
Collection Agent in good faith and set forth in the most recent Investor Report,
such calculation to be based on the assumptions that (a) each Receivable within
a particular aging category (as set forth in the Investor Report) will be paid
on the last day of such aging category and (b) the last day of the last such
aging category coincides with the last date on which any Outstanding Balance of
Receivables would be written off as uncollectible or charged against any
applicable reserve or similar account in accordance with the objective
requirements of the Credit and Collection Policy and the Seller's and the
Transferor's normal accounting practices applied on a basis consistent with
those reflected in the Seller's financial statements, provided, however, that if
the Agent, any Administrative Agent or any Investor shall reasonably disagree
with any such calculation, the Agent may recalculate the Estimated Maturity
Period, and such recalculation, in the absence of manifest error, shall be
conclusive.
"Eurodollar Rate" means, with respect to any Eurodollar Tranche
Period for the Investors in any Related Group, a rate which is equal to the sum
(rounded upwards, if necessary, to the next higher 1/100 of 1%) of (A) the
Applicable Margin at such time, (B) the rate obtained by dividing (i) the
applicable LIBOR Rate by (ii) a percentage equal to 100% minus the reserve
percentage used for determining the maximum reserve requirement as specified in
Regulation D (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) that is applicable to the
Administrative Agent for such Related Group during such Eurodollar Tranche
Period in respect of eurocurrency or eurodollar funding, lending or liabilities
(or, if more than one percentage shall be so applicable, the daily average of
such percentage for those days in such Eurodollar Tranche Period during which
any such percentage shall be applicable) plus (C) the then daily net annual
assessment rate (rounded upwards, if necessary, to the nearest 1/100 of 1%) as
estimated by such Administrative Agent for determining the current annual
assessment payable by such Administrative Agent to the Federal Deposit Insurance
Corporation in respect of eurocurrency or eurodollar funding, lending or
liabilities.
"Eurodollar Tranche" means a Tranche as to which Discount is
calculated at the Eurodollar Rate.
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"Eurodollar Tranche Period" means, with respect to a Eurodollar
Tranche for the Investors in any Related Group, prior to the Termination Date, a
period of up to one month requested by the Transferor and agreed to by the
Administrative Agent for such Related Group, commencing on a Business Day
requested by the Transferor and agreed to by such Administrative Agent;
provided, however, that if such Eurodollar Tranche Period would expire on a day
which is not a Business Day, such Eurodollar Tranche Period shall expire on the
next succeeding Business Day; provided, further, that if such Eurodollar Tranche
Period would expire on (a) a day which is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such Eurodollar
Tranche Period shall expire on the next preceding Business Day or (b) a Business
Day for which there is no numerically corresponding day in the applicable
subsequent calender month, such Eurodollar Tranche Period shall expire on the
last Business Day of such month.
"Event of Bankruptcy" means, with respect to any Person, (i) that
such Person (a) shall generally not pay its debts as such debts become due or
(b) shall admit in writing its inability to pay its debts generally or (c) shall
make a general assignment for the benefit of creditors; (ii) any proceeding
shall be instituted by or against such Person seeking to adjudicate it as
bankruptcy or insolvent, or seeking liquidation, winding up, reorganization,
arrangements, adjustment, protection, relief or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any substantial part of
its property or (iii) if such Person is a corporation (or other business
entity), such Person or any Subsidiary shall take any corporate (or analogous)
action to authorize any of the actions set forth in the preceding clauses (i) or
(ii).
"Excluded Taxes" shall have the meaning specified in Section 8.3
hereof.
"Existing TAA" shall have the meaning specified in the Preliminary
Statements hereof.
"Facility Fee" means, with respect to any Conduit Investor, the fee
payable by the Transferor to such Conduit Investor pursuant to Section 2.7(a)
hereof, the terms of which are set forth in the Fee Letter to which such Conduit
Investor is a party.
"Facility Limit" means $360,000,000; provided that such amount may
not at any time exceed the aggregate Commitments at any time in effect.
"Fee Letter" means (i) the letter agreement dated the date hereof
among the Transferor, Enterprise and Bank of America with respect to the fees to
be paid by the Transferor hereunder in respect of the Related Group that
includes Enterprise, as amended, modified or supplemented from time to time or
(ii) the letter agreement dated the date hereof between the Transferor, Compass
and WestLB with respect to the fees to be paid by the Transferor hereunder with
respect to the Related Group that includes Compass, as amended, modified or
supplemented from time to time.
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"Finance Charges" means, with respect to a Contract, any finance,
interest, late or similar charges owing by an Obligor pursuant to such Contract.
"FMC" means Fresenius Medical Care AG, a corporation organized and
existing under the laws of the Federal Republic of Germany, and its successors
and permitted assigns.
"FMCH" means Fresenius Medical Care Holdings, Inc., a New York
corporation, and its successors and permitted assigns.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such accounting profession, which are in effect as of the date of
this Agreement.
"Guaranty" means, with respect to any Person any agreement by which
such Person assumes, guarantees, endorses, contingently agrees to purchase or
provide funds for the payment of, or otherwise becomes liable upon, the
obligation of any other Person, or agrees to maintain the net worth or working
capital or other financial condition of any other Person or otherwise assures
any other creditor of such other Person against loss, including, without
limitation, any comfort letter, operating agreement or take-or-pay contract and
shall include, without limitation, the contingent liability of such Person in
connection with any application for a letter of credit.
"HCFA" means the Health Care Financing Administration, an agency of
the HHS charged with administering and regulating, among other things, certain
aspects of Medicaid and Medicare.
"HHS" means the Department of Health and Human Services, an agency
of the Federal Government of the United States.
"Hospital Obligor" means any Obligor referred to in clause (D) of
the definition of "Obligor" contained in this Section 1.1 hereof.
"Incremental Transfer" means a Transfer upon giving effect to which
the Net Investment hereunder shall be increased.
"Indebtedness" means, with respect to any Person and without
duplication, such Person's (i) obligations for borrowed money, (ii) obligations
representing the deferred purchase price of property other than accounts payable
arising in the ordinary course of such Person's business on terms customary in
the trade, (iii) obligations, whether or not assumed, secured by liens or
payable out of the proceeds or production from property now or hereafter owned
or acquired by such Person, (iv) obligations which are evidenced by notes,
acceptances, or other instruments, (v) Capitalized Lease obligations and (vi)
obligations for which such Person is obligated pursuant to a Guaranty.
"Indemnified Amounts" has the meaning specified in Section 8.1
hereof.
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"Indemnified Parties" has the meaning specified in Section 8.1
hereof.
"Initial Transfer Documents" shall have the meaning specified in
Section 5.2(h).
"Interest Component" shall mean, (i) with respect to any Commercial
Paper issued on an interest-bearing basis, the interest payable on such
Commercial Paper at its maturity (including any dealer commissions) and (ii)
with respect to any Commercial Paper issued on a discount basis, the portion of
the face amount of such Commercial Paper representing the discount incurred in
respect thereof (including any dealer commissions).
"Investor" means a Conduit Investor or a Bank Investor.
"Investor Report" means a report, in substantially the form attached
hereto as Exhibit E or in such other form as is mutually agreed to by the
Transferor and each Administrative Agent, furnished by the Collection Agent
pursuant to Section 2.11 hereof.
"Law" means any law (including common law), constitution, statute,
treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of
any Official Body.
"LIBOR Rate" means, with respect to any Eurodollar Tranche Period
for the Investors in any Related Group, the rate at which deposits in dollars
are offered to the Administrative Agent for such Related Group, in the London
interbank market at approximately 11:00 a.m. (London time) two Business Days
before the first day of such Eurodollar Tranche Period in an amount
approximately equal to the Eurodollar Tranche to which the Eurodollar Rate is to
apply and for a period of time approximately equal to the applicable Eurodollar
Tranche Period.
"Liquidation Yield" means, at any time, an amount equal to:
(RVF x LBR x NI) x (EMP + CDF)
-----------
360
Where:
RVF = the Rate Variance Factor at such time;
LBR = the Base Rate at such time which is applicable to the liquidation
period after a Termination Event;
NI = the Net Investment at such time;
EMP = the Estimated Maturity Period of the Receivables; and
CDF = the Collection Delay Factor.
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"Liquidity Provider" means, with respect to any Conduit Investor,
the Person or Persons who will provide liquidity support to such Conduit
Investor in connection with the issuance by such Conduit Investor or its Related
CP Issuer of Commercial Paper.
"Liquidity Provider Agreement" means an agreement between a Conduit
Investor and one or more Liquidity Providers evidencing the obligation of each
such Liquidity Provider to provide liquidity support to such Conduit Investor in
connection with the issuance by such Conduit Investor or its Related CP Issuer
of Commercial Paper.
"Loss Horizon" means, as of any date, the product of (a) a ratio
(expressed as a percentage) computed by dividing (i) the aggregate Outstanding
Balance of all Receivables acquired by the Seller during the nine most recently
ended calendar months by (ii) the aggregate Outstanding Balance of all
Receivables that are not more than 270 days past due as of the last day of the
most recently ended calendar month times (b) the highest average Default Ratio
for any consecutive three month period during the immediately preceding 12-month
period.
"Loss Percentage" means on any day the greater of (i) one and
one-half (1.5) times the Loss Horizon as of such day and (ii) 20%.
"Loss Reserve" means, on any day, an amount equal to:
LP x (NI + DLR + DR + SFR)
Where:
LP = the Loss Percentage at the close of business of the Collection Agent
on such day;
NI = the Net Investment at the close of business of the Collection Agent
on such day;
DLR = the Dilution Reserve at the close of business of the Collection
Agent on such day;
DR = the Discount Reserve at the close of business of the Collection
Agent on such day;
SFR = the Servicing Fee Reserve at the close of business of the Collection
Agent on such day.
Notwithstanding the foregoing, the Loss Reserve shall at all times be at least
equal to $16,250,000.
"Loss-to-Liquidation Ratio" means the ratio (expressed as a
percentage) computed as of the last day of each calendar month by dividing (i)
the aggregate Outstanding Balance of all Receivables which became Defaulted
Receivables during such month, by (ii) the aggregate amount of Collections
received by the Collection Agent during such period.
"Majority Investors" means, at any time, those Bank Investors which
hold Commitments aggregating in excess of 66 and 2/3% of the Facility Limit as
of such date.
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"Material Adverse Effect" means a material adverse effect on any of
(i) the collectibility or enforceability of a material portion of the
Receivables or Related Security, (ii) the ability of the Transferor or any
Originating Entity to charge or collect a material portion of the Receivables or
Related Security, (iii) the ability of (A) the Transferor or any Originating
Entity to perform or observe in any material respect any provision of this
Agreement or any other Transaction Document to which it is a party or (B) of FMC
or FMCH to cause the due and punctual performance and observation by the Seller
or the Transferor of any such provision or, if the Seller or the Transferor
shall fail to do so, to perform or observe any such provision required to be
performed or observed by the Seller or the Transferor under this Agreement or
any other Transaction Document to which the Seller or the Transferor is party,
in each case pursuant to the Parent Agreement, (iv) the ability of (A) any
Transferring Affiliate to perform or observe in any material respect any
provision of the Transferring Affiliate Letter or, in the case of BMA, the BMA
Transfer Agreement or, in the case of any Designated Account Agent, the
applicable Account Agent Agreement, or (B) of FMC or FMCH to cause the due and
punctual performance and observation by such Transferring Affiliate, BMA or such
Designated Account Agent of any such provision or, if such Transferring
Affiliate, BMA or such Designated Account Agent shall fail to do so, to perform
or observe any such provision, in each case pursuant to the Parent Agreement,
(v) the financial condition, operations, businesses or properties of FMC, FMCH,
NMC or the Transferor or (vi) the interests of the Agent, any Administrative
Agent or any of the Investors under the Transaction Documents.
"Maximum Percentage Factor" means 98%.
"Medicaid" means the medical assistance program established by Title
XIX of the Social Security Act (42 USC Sections 1396 et seq.) and any statutes
succeeding thereto.
"Medicaid Regulations" means, collectively, (a) all federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting Medicaid; (b) all state statutes and plans for medical assistance
enacted in connection with such statutes and federal rules and regulations
promulgated pursuant to or in connection with such statutes; and (c) all
applicable provisions of all rules, regulations manuals, orders and
administrative, reimbursement and other guidelines of all Governmental
Authorities (including, without limitation, HHS, HCFA, the office of the
Inspector General for HHS, or any Person succeeding to the functions of any of
the foregoing) promulgated pursuant to or in connection with any of the
foregoing (whether or not having the force of law), in each case as may be
amended, supplemented or otherwise modified from time to time.
"Medicare" means the health insurance program for the aged and
disabled established by Title XVIII of the Social Security Act (42 USC Sections
1395 et seq.) and any statutes succeeding thereto.
"Medicare Regulations" means, collectively, (a) all federal statutes
(whether set forth in Title XVIII of the Social Security Act or elsewhere)
affecting Medicare; and (b) all applicable provisions of all rules, regulations,
manuals, orders and administrative, reimbursement and other guidelines of all
Governmental Authorities (including, without limitation, HHS, HCFA, the Office
of the Inspector General for HHS, or any Person succeeding to the functions
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of any of the foregoing) promulgated pursuant to or in connection with the
foregoing (whether or not having the force of law), as each may be amended,
supplemented or otherwise modified from time to time.
"Minimum Amount" shall have the meaning specified in Section 5.1(h).
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA which is or was at any time during the current year
or the immediately preceding five years contributed to by the Transferor, the
Seller or any ERISA Affiliate of the Transferor or the Seller on behalf of its
employees.
"Net Asset Test" shall mean, in connection with any assignment by a
Conduit Investor of an interest in the Net Investment pursuant to Section 9.7
hereof, that on the day immediately prior to the day on which such assignment is
to take effect, the Net Receivables Balance shall be greater than the Net
Investment.
"Net Investment" means the sum of the cash amounts paid to the
Transferor for each Incremental Transfer less the aggregate amount of
Collections received and applied by the Agent to reduce such Net Investment
pursuant to Section 2.5, 2.6 or 2.9 hereof; provided that the Net Investment
shall be restored and reinstated in the amount of any Collections so received
and applied if at any time the distribution of such Collections is rescinded or
must otherwise be returned for any reason; and provided further that the Net
Investment may be increased by the amount described in Section 9.7(d) as
described therein. A portion of the Net Investment shall be deemed to be held by
an Investor to the extent such portion of the Net Investment shall have been
funded by, or assigned to, such Investor.
"Net Receivables Balance" means at any time the Outstanding Balance
of the Eligible Receivables at such time reduced by the sum of (i) the aggregate
amount by which the Outstanding Balance of all Eligible Receivables of each
Designated Obligor or class of Designated Obligors exceeds the Concentration
Factor for such Designated Obligor or class of Designated Obligors, plus (ii)
the aggregate Outstanding Balance of all Eligible Receivables which are
Defaulted Receivables, plus (iii) the aggregate Outstanding Balance of all
Eligible Receivables of each Obligor with respect to which 25% or more of such
Obligor's Receivables are Defaulted Receivables.
"NMC" means National Medical Care, Inc., a Delaware corporation and
owner of 100% of the outstanding stock of the Transferor.
"NPRBI" shall have the meaning specified in Section 2.13.
"Obligor" of any Receivable means (i) any Person obligated to make
payments of such Receivable pursuant to a Contract and/or (ii) any Person owing
any amount in respect of such Receivable, or in respect of any Related Security
with respect to such Receivable, all such Persons referred to in any of clauses
(A), (B), (E), (F) and (G) below, and each Person referred to
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in any of clauses (C) and (D) below, to be deemed for purposes of this Agreement
to be one Obligor:
(A): all Persons owing Receivables or Related Security
under the Medicare program;
(B): all Persons owing Receivables or Related Security
under the Medicaid program;
(C): each Person which is an insurance company;
(D): each Person which is a hospital or other health care
provider;
(E): all Persons, other than health care providers or
Persons referred to in clause (A), (B), (C) or (D) above or
clause (F) or (G) below, owing Receivables arising from the sale
by NMC Medical Products, Inc. of services or merchandise;
(F): all Persons owing Receivables or Related Security
under the CHAMPUS/VA Program; and
(G): all Persons who receive the services or merchandise the
sale of which results in Receivables that are not insured,
guaranteed or otherwise supported in respect thereof by any of the
Persons referred to in clauses (A) through (F) above, including any
Person owing any amount in respect of Receivables by reason of
insurance policy deductibles or co-insurance agreements or
arrangements.
"Official Body" means any government or political subdivision or any
agency, authority, bureau, central bank, commission, department or
instrumentality of any such government or political subdivision, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
"Originating Entity" means any of the Seller and any Transferring
Affiliate.
"Other Transferor" means, with respect to any Conduit Investor, any
Person other than the Transferor that has entered into a receivables purchase
agreement or transfer and administration agreement with such Conduit Investor.
"Outstanding Balance" means, with respect to any Receivable at any
time, the then outstanding principal amount thereof excluding any accrued and
outstanding Finance Charges related thereto.
"Parent Agreement" means an agreement substantially in the form set
forth as Exhibit P hereto dated as of the date hereof made by FMC and FMCH in
respect of the obligations of the Originating Entities and NMC under the
Transaction Documents, as the same may be amended, restated, supplemented or
otherwise modified from time to time with the consent of each Administrative
Agent.
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"Parent Group" means, collectively, FMC, FMCH, NMC, the Transferor,
the Originating Entities and their Subsidiaries and Affiliates, and "Parent
Group Member" means any such Person individually.
"Payor" shall, solely for purposes of Section 8.3, have the meaning
specified in such section.
"Percentage Factor" shall mean the fraction (expressed as a
percentage) computed at any time of determination as follows:
NI + LR + DLR + DR + SFR
NRB
Where:
NI = the Net Investment at the time of such computation;
LR = the Loss Reserve at the time of such computation;
DLR = the Dilution Reserve at the time of such computation;
DR = the Discount Reserve at the time of such computation;
SFR = the Servicing Fee Reserve at the time of such computation; and
NRB = the Net Receivables Balance at the time of such computation.
"Person" means any corporation, limited liability company, natural
person, firm, joint venture, partnership, trust, unincorporated organization,
enterprise, government or any department or agency or any government.
"Potential Termination Event" means an event which but for the lapse
of time or the giving of notice, or both, would constitute a Termination Event.
"Primary Payor" means (i) each Obligor referred to in clauses (A),
(B), (E), (F) and (G) of the definition of "Obligor" contained in this Section
1.1, (ii) collectively, all Obligors of the type referred to in clause (C) of
the definition of "Obligor" contained in this Section 1.1 and (iii)
collectively, all Obligors of the type referred to in clause (D) of the
definition of "Obligor" contained in this Section 1.1.
"Pro Rata Share" means, for a Bank Investor in any Related Group,
the Commitment of such Bank Investor divided by the sum of the Commitments of
all Bank Investors in such Related Group.
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"Proceeds" means "proceeds" as defined in Section 9-306(1) of
the UCC as in effect on the date hereof.
"Program Fee" means, with respect to any Conduit Investor, the fee
payable by the Transferor to such Conduit Investor pursuant to Section 2.7(a)
hereof, the terms of which are set forth in the Fee Letter to which such Conduit
Investor is a party.
"Purchased Interest" means the interest in the Receivables acquired
by a Liquidity Provider from a Conduit Investor through purchase pursuant to the
terms of a Liquidity Provider Agreement.
"Purchase Termination Date" means the date upon which the Transferor
shall cease, for any reason whatsoever, to make purchases of Receivables from
the Seller under the Receivables Purchase Agreement or the Receivables Purchase
Agreement shall terminate for any reason whatsoever.
"Rate Variance Factor" means the number, computed from time to time
in good faith by the Agent (with the written consent of each Administrative
Agent), that reflects the largest potential variance (from minimum to maximum)
in selected interest rates over a period of time selected by the Agent from time
to time, set forth in written notice by the Agent to each Administrative Agent,
the Transferor and the Collection Agent].
"Ratable Share" means (i) in the case of a Conduit Investor in any
Related Group, a fraction (expressed as a percentage) equal to the Related Group
Limit of such Related Group divided by the Facility Limit and (ii) in the case
of a Bank Investor, a fraction (expressed as a percentage) equal to such Bank
Investor's Commitment divided by the sum of the Commitments of all Bank
Investors (including Bank Investors from other Related Groups).
"Receivable" means the indebtedness of any Obligor under a Contract
and sold by the Seller to the Transferor pursuant to the Receivables Purchase
Agreement, whether constituting an account, chattel paper, instrument, insurance
claim, investment property or general intangible, arising in connection with the
sale or lease of merchandise, or the rendering of services, by an Originating
Entity, and includes the right to payment of any Finance Charges and other
obligations of such Obligor with respect thereto.
"Receivable Systems" has the meaning specified in Section 3.1(aa).
"Receivables Purchase Agreement" means the Receivables Purchase
Agreement dated as of August 28, 1997 by and between NMC, as seller, and the
Transferor, as purchaser, as such agreement may be amended, modified or
supplemented and in effect from time to time.
"Recipient" shall, solely for purposes of Section 8.3, have the
meaning specified in such section.
"Records" means all Contracts and other documents, books, records
and other information (including, without limitation, computer programs, tapes,
discs, punch cards, data
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processing software and related property and rights) maintained with respect to
receivables and the related Obligors.
"Reinvestment Termination Date" means, with respect to any Conduit
Investor, the second Business Day after the delivery by such Conduit Investor to
the Transferor of written notice that such Conduit Investor elects to commence
the amortization of its interest in the Net Investment or otherwise liquidate
its interest in the Transferred Interest.
"Reinvestment Transfer" means a Transfer occurring in connection
with the reinvestment of Collections pursuant to Section 2.2(b) and 2.5.
"Related Commercial Paper" shall mean Commercial Paper issued by a
Conduit Investor or its Related CP Issuer the proceeds of which were used to
acquire, or refinance the acquisition of, an interest in Receivables with
respect to the Transferor.
"Related CP Issuer" means, when used in relation to Compass, Compass
Securitization L.L.C., a Delaware limited liability company, together with its
successors and permitted assigns.
"Related Group" means either of the following groups: (i) Enterprise
and Bank of America, N.A., as a Bank Investor and as an Administrative Agent,
together with their respective successors and permitted assigns and (ii) Compass
and WestLB, as a Bank Investor and as an Administrative Agent, together with
their respective successors and permitted assigns.
"Related Group Limit" means (i) with respect to the Related Group
that includes Enterprise, $180,000,000 and (ii) with respect to the Related
Group that includes Compass, $180,000,000.
"Related Security" means with respect to any Receivable, all of the
Transferor's rights, title and interest in, to and under:
(i) all of the Seller's, the Transferor's or any Transferring
Affiliate's interest, if any, in the merchandise (including returned or
repossessed merchandise), if any, the sale of which gave rise to such
Receivable;
(ii) all other security interests or liens and property
subject thereto from time to time, if any, purporting to secure payment of
such Receivable, whether pursuant to the Contract related to such
Receivable or otherwise, together with all financing statements signed by
an Obligor describing any collateral securing such Receivable;
(iii) all guarantees, indemnities, warranties, insurance (and
proceeds and premium refunds thereof) or other agreements or arrangements
of any kind from time to time supporting or securing payment of such
Receivable whether pursuant to the Contract related to such Receivable or
otherwise, including, without limitation, insurance, guaranties and other
agreements or arrangements under the Medicare program, the Medicaid
program, state renal programs, CHAMPUS/VA, private insurance policies, and
hospital and other health care programs and health care provider
arrangements;
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(iv) all Records related to such Receivable;
(v) all rights and remedies of the Transferor (A) under the
Receivables Purchase Agreement, together with all financing statements
filed by the Transferor against the Seller in connection therewith, (B)
under the Transferring Affiliate Letter, together with all financing
statements filed in connection therewith against the Transferring
Affiliates, (C) under the BMA Transfer Agreement, together with all
financing statements filed in connection therewith against BMA and (D)
under the Parent Agreement; and
(vi) all Proceeds of any of the foregoing.
"Section 8.2 Costs" has the meaning specified in Section 8.2(d)
hereof.
"Seller" means NMC and its successors and permitted assigns.
"Servicing Fee" means the fees payable by a Conduit Investor or the
Bank Investors in its Related Group to the Collection Agent, with respect to a
Tranche held by the Investors in such Related Group, in an amount equal to 0.25%
per annum on the amount of the Net Investment allocated to such Tranche pursuant
to Section 2.3 hereof. Such fee shall accrue from the date of the initial
purchase of an interest in the Receivables to the date on which the Percentage
Factor is reduced to zero. Such fee shall be payable only from Collections
pursuant to, and subject to the priority of payments set forth in, Section 2.5
hereof. After the Termination Date, such fee shall be payable only from
Collections pursuant to, and subject to the priority of payments set forth in,
Section 2.6 hereof.
"Servicing Fee Reserve" means at any time an amount equal to the
product of (i) the aggregate Outstanding Balance of all Receivables at such
time, (ii) the Servicing Fee percentage and (iii) a fraction having as the
numerator, the sum of (a) the Estimated Maturity Period plus (b) the Collection
Delay Period, and as the denominator, 360.
"Social Security Act" means the Social Security Act, as amended from
time to time, and the regulations promulgated and rulings and advisory opinions
issued thereunder.
"Special Account" means a special depositary account maintained at a
bank acceptable to the Agent for the purpose of receiving Collections, which
account is in the name of either (i) the Originating Entity in respect of the
Receivables giving rise to such Collections or (ii) a Designated Account Agent
acting on behalf of such Originating Entity.
"Special Account Bank" means any of the banks holding one or more
Special Accounts.
"Special Account Letter" means a letter, in substantially the form
of Exhibit D-1 hereto, from an Originating Entity (or, if applicable, a
Designated Account Agent) to any Special Account Bank, executed by such
Originating Entity (or such Designated Account Agent) to such Special Account
Bank.
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"Standard & Poor's" or "S&P" means Standard & Poor's Ratings
Services, a division of McGraw-Hill Companies, Inc.
"Subordinated Note" shall have the meaning specified in the
Receivables Purchase Agreement.
"Subsidiary" of a Person means any Person more than 50% of the
outstanding voting interests of which shall at any time be owned or controlled,
directly or indirectly, by such Person or by one or more Subsidiaries of such
Person or any similar business organization which is so owned or controlled.
"Taxes" shall have the meaning specified in Section 8.3 hereof.
"Termination Date" means the earliest of (i) the Business Day
designated by the Transferor to each Administrative Agent as the Termination
Date at any time following 60 days' written notice to each Administrative Agent,
(ii) the date of termination of the commitment of any Liquidity Provider under a
Liquidity Provider Agreement, (iii) the date of termination of the commitment of
any Credit Support Provider under a Credit Support Agreement, (iv) the day upon
which the Termination Date is declared or automatically occurs pursuant to
Section 7.2(a) hereof, (v) two Business Days prior to the Commitment Termination
Date, (vi) the day on which a Reinvestment Termination date shall occur, (vii)
the Purchase Termination Date, or (viii) September 25, 2000.
"Termination Event" means an event described in Section 7.1 hereof.
"Tranche" means a portion of the Net Investment allocated to a
Tranche Period pursuant to Section 2.3 hereof.
"Tranche Period" means a CP Tranche Period, a BR Tranche Period
or a Eurodollar Tranche Period.
"Tranche Rate" means the CP Rate, the Base Rate or the Eurodollar
Rate.
"Transaction Costs" has the meaning specified in Section 8.4(a)
hereof.
"Transaction Documents" means, collectively, this Agreement, the
Receivables Purchase Agreement, the Fee Letters, the Special Account Letters,
the Concentration Account Agreement, the Account Agent Agreement(s), the
Certificates, the Transfer Certificates, the Transferring Affiliate Letter, the
BMA Transfer Agreement, the Parent Agreement and all of the other instruments,
documents and other agreements executed and delivered by any Originating Entity,
FMC, FMCH, NMC or the Transferor in connection with any of the foregoing, in
each case, as the same may be amended, restated, supplemented or otherwise
modified from time to time.
"Transfer" means a conveyance, transfer and assignment by the
Transferor to the Agent, for the benefit of the applicable Investors, of an
undivided percentage ownership interest in Receivables hereunder together with
Related Security, Collections and Proceeds with respect
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thereto (including, without limitation, as a result of any reinvestment of
Collections in Transferred Interests pursuant to Sections 2.2(b) and 2.5).
"Transfer Certificate" has the meaning specified in Section 2.2(a)
hereof.
"Transfer Date" means, with respect to each Transfer, the Business
Day on which such Transfer is made.
"Transfer Price" means with respect to any Incremental Transfer to
be made by the Agent, on behalf of the Investors participating in such
Incremental Transfer, the amount paid to the Transferor by such Investors as
described in the applicable Transfer Certificate.
"Transferor" means NMC Funding Corporation, a Delaware corporation,
and its successors and permitted assigns.
"Transferred Interest" means, at any time of determination, an
undivided percentage ownership interest in (i) each and every then outstanding
Receivable, (ii) all Related Security with respect to each such Receivable,
(iii) all Collections with respect thereto, and (iv) other Proceeds of the
foregoing, which undivided ownership interest shall be equal to the Percentage
Factor at such time, and only at such time (without regard to prior
calculations). The Transferred Interest in each Receivable, together with
Related Security, Collections and Proceeds with respect thereto, shall at all
times be equal to the Transferred Interest in each other Receivable, together
with Related Security, Collections and Proceeds with respect thereto. To the
extent that the Transferred Interest shall decrease as a result of a
recalculation of the Percentage Factor, the Agent, on behalf of the applicable
Investors, shall be considered to have reconveyed to the Transferor (without
recourse, representation or warranty of any type or kind) an undivided
percentage ownership interest in each Receivable, together with Related
Security, Collections and Proceeds with respect thereto, in an amount equal to
such decrease such that in each case the Transferred Interest in each Receivable
shall be equal to the Transferred Interest in each other Receivable.
"Transferring Affiliate" means a company specified on Exhibit Q
hereto, as such Schedule may be amended from time to time as provided in Section
2.15; provided, however, that no such company shall be a Transferring Affiliate
from and after the occurrence of any Event of Bankruptcy by or with respect
thereto unless any Receivables that arose from sales by such company exist on
such date, in which case such company shall continue to be a Transferring
Affiliate until the respective Outstanding Balances of all such Receivables
shall have been reduced to zero; and provided, further, that, solely with
respect to the Receivables transferred by it to the Seller pursuant to the BMA
Transfer Agreement, BMA shall constitute a "Transferring Affiliate" hereunder.
"Transferring Affiliate Letter" means, collectively, the respective
letters, in each case in substantially the form of Exhibit O hereto, from the
Transferring Affiliates (other than BMA) to the Agent, the Transferor and the
Seller, as the same may be amended, restated, supplemented or otherwise modified
from time to time with the consent of the Agent.
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"UCC" means, with respect to any state, the Uniform Commercial Code
as from time to time in effect in such state.
"U.S." or "United States" means the United States of America.
"US Government Obligor" means any Obligor that is the federal
government of the United States, or any subdivision or agency thereof the
obligations of which are supported by the full faith and credit of the United
States, and shall include any Obligor referred to in clause (A),(B) or (F) of
the definition of "Obligor" contained in this Section 1.1.
"Voting Stock" means, with respect to any Person, capital stock
issued by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
"WestLB" means Westdeutsche Landesbank Girozentrale, New York
Branch, together with its successors and assigns.
"Year 2000 Compliant" has the meaning specified in Section 3.1(aa).
SECTION 1.2. Other Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. All terms used in
Article 9 of the UCC in the State of New York, and not specifically defined
herein, are used herein as defined in such Article 9.
SECTION 1.3. Computation of Time Periods. Unless otherwise stated in
this Agreement, in the computation of a period of time from a specified date to
a later specified date, the word "from" means "from and including", the words
"to" and "until" each means "to but excluding", and the word "within" means
"from and excluding a specified date and to and including a later specified
date".
SECTION 1.4. Amendment and Restatement. Subject to the satisfaction
of the conditions precedent set forth in Section 4.1, this Agreement amends and
restates the Existing TAA in its entirety. This Agreement is not intended to
constitute a novation of the Existing TAA. Upon the effectiveness of this
Agreement, each reference to the Existing TAA in any other document, instrument
or agreement executed and/or delivered in connection therewith shall mean and be
a reference to this Agreement.
ARTICLE II
PURCHASE AND SETTLEMENTS
SECTION 2.1. Facility. Upon the terms and subject to the conditions
herein set forth, the Transferor may from time to time prior to the Termination
Date, at its option, convey, transfer and assign to the Agent, on behalf of the
applicable Investors, percentage ownership interests in the Receivables,
together with Related Security, Collections and Proceeds with respect thereto.
Each such Transfer shall be made among the Related Groups ratably in accordance
with their respective Related Group Limits. Subject to the terms and conditions
set
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forth herein, the Agent shall accept such conveyance, transfer and assignment on
behalf of (x) each Conduit Investor that shall have elected, in its sole
discretion, to participate in such Transfer, and (y) to the extent any Conduit
Investor shall have elected not to participate in such Transfer, each of the
Bank Investors in such Conduit Investor's Related Group. By accepting any
conveyance, transfer and assignment hereunder, none of the Conduit Investors,
the Bank Investors, the Administrative Agents or the Agent assumes or shall have
any obligations or liability under any of the Contracts, all of which shall
remain the obligations and liabilities of the Transferor and the Seller.
SECTION 2.2. Transfers; Certificates; Eligible Receivables (a)
Incremental Transfers. Upon the terms and subject to the conditions herein set
forth the Transferor may, at its option, request that an Incremental Transfer be
made by the Agent, on behalf of each of the applicable Investors. It shall be a
condition precedent to each Incremental Transfer that (i) after giving effect to
the payment to the Transferor of the applicable Transfer Price (x) the sum of
the Net Investment plus the Interest Component of all outstanding Related
Commercial Paper, would not exceed the Facility Limit, (y) the Percentage Factor
would not exceed the Maximum Percentage Factor and (z) the Net Investment would
not exceed $352,800,000; (ii) the representations and warranties set forth in
Section 3.1 shall be true and correct both immediately before and immediately
after giving effect to any such Incremental Transfer and the payment to the
Transferor of the Transfer Price related thereto; (iii) an Investor Report shall
have been delivered prior to such Incremental Transfer as required by Section
3.2 hereof and (iv) in the case of any Incremental Transfer to the Bank
Investors in any Related Group, either (x) such Bank Investors shall have
previously accepted the assignment by the related Conduit Investor of all of its
interest in the Affected Assets or (y) such Conduit Investor shall have had an
opportunity to direct that such assignment occur on or prior to giving effect to
such Incremental Transfer.
The Transferor shall, by notice to the Agent and each Administrative
Agent given by telecopy, offer to convey, transfer and assign to the Agent, on
behalf of the applicable Investors, undivided percentage ownership interests in
the Receivables and the other Affected Assets relating thereto at least three
(3) Business Days prior to the proposed date of any Incremental Transfer. Each
such notice shall specify (w) with respect to each Related Group, whether such
request is made to the Agent, on behalf of the Conduit Investor in such Related
Group or on behalf of the Bank Investors in such Related Group (it being
understood and agreed that once any Transferred Interest hereunder is acquired
on behalf of the Bank Investors in any Related Group, the Agent, on behalf of
Bank Investors in such Related Group, shall be required to purchase all
Transferred Interests held by the Agent on behalf of the Conduit Investor in
such Related Group in accordance with Section 9.7 and thereafter no additional
Incremental Transfers shall be acquired on behalf of such Conduit Investor
hereunder), (x) the desired Transfer Price (which shall be at least $1,000,000
or integral multiples of $250,000 in excess thereof) or, to the extent that the
then available unused portion of the Facility Limit is less than such amount,
such lesser amount equal to such available portion of the Facility Limit, (y)
the desired date of such Incremental Transfer and (z) the desired Tranche
Period(s) and allocations of the Net Investment of such Incremental Transfer
thereto as required by Section 2.3. Each Administrative Agent will promptly
notify the related Conduit Investor or each of the Bank Investors in its Related
Group, as the case may be, of such Administrative Agent's receipt of any request
for an Incremental
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Transfer to be made to the Agent on behalf of such Person. To the extent that
any such Incremental Transfer is requested of the Agent, on behalf of a Conduit
Investor, such Conduit Investor shall instruct the Agent to accept or reject
such offer by notice given to the Transferor and the Agent by telephone or
telecopy by no later than the close of its business on the Business Day
following its receipt of any such request. Each notice of proposed Transfer
shall be irrevocable and binding on the Transferor and the Transferor shall
indemnify each Conduit Investor and each Bank Investor against any loss or
expense incurred by any Conduit Investor or any Bank Investor, either directly
or indirectly (including, in the case of a Conduit Investor, through the related
Liquidity Provider Agreement) as a result of any failure for any reason
(including failure to satisfy any of the conditions precedent in respect
thereof) by the Transferor to complete such Incremental Transfer including,
without limitation, any loss (including loss of anticipated profits) or expense
incurred by any Conduit Investor or any Bank Investor, either directly or
indirectly (including, in the case of a Conduit Investor, pursuant to the
related Liquidity Provider Agreement) by reason of the liquidation or
reemployment of funds acquired by any Conduit Investor (or a related Liquidity
Provider) or any Bank Investor (including, without limitation, funds obtained by
issuing commercial paper or promissory notes or obtaining deposits as loans from
third parties) for any Conduit Investor or any Bank Investor to fund such
Incremental Transfer.
On the date of the initial Incremental Transfer under the Existing
TAA, the Transferor delivered to the Agent the Transfer Certificate in the form
of Exhibit F hereto (the "Transfer Certificate"). On the date of each
Incremental Transfer, each Administrative Agent shall send written confirmation
to the Transferor and to the Agent of the Transfer Price, the Tranche Period(s),
the Transfer Date and the Tranche Rate(s) applicable to the portion of such
Incremental Transfer made by such Administrative Agent's Related Group. The
Agent shall indicate the amount of the Incremental Transfer together with the
date thereof as well as any decrease in the Net Investment on the grid attached
to the Transfer Certificate. The Transfer Certificate shall evidence the
Incremental Transfers.
By no later than 11:00 a.m. (New York time) on any Transfer Date,
each Investor participating in the relevant Transfer shall remit its Ratable
Share of the aggregate Transfer Price for such Transfer to the account of the
Agent specified therefor from time to time by the Agent by notice to such
Investor. The obligation of each Investor to remit its Ratable Share of any such
Transfer Price shall be several from that of each other Investor, and the
failure of any Investor to so make such amount available to the Agent shall not
relieve any other Investor of its obligation hereunder. Following each
Incremental Transfer and the Agent's receipt of funds from the Investors
participating in such Transfer as aforesaid, the Agent shall remit the Transfer
Price to the Transferor's account at the location indicated in Section 10.3
hereof, in immediately available funds, an amount equal to the Transfer Price
for such Incremental Transfer. Unless the Agent shall have received notice from
any Bank Investor participating in an Incremental Transfer that such Bank
Investor will not make its share of any Transfer Price relating to such
Incremental Transfer available on the applicable Transfer Date therefor, the
Agent may (but shall have no obligation to) make such Bank Investor's share of
any such Transfer Price available to the Transferor in anticipation of the
receipt by the Agent of such amount from such Bank Investor. To the extent such
Bank Investor fails to remit any such amount to the Agent after any
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such advance by the Agent on such Transfer Date, such Bank Investor, on the one
hand, and the Transferor, on the other hand, shall be required to pay such
amount, together with interest thereon at a per annum rate equal to the Federal
funds rate (as determined in accordance with clause (ii) of the definition of
"Base Rate"), in the case of such Bank Investor, or the Base Rate, in the case
of the Transferor, to the Agent upon its demand therefor. Until such amount
shall be repaid, such amount shall be deemed to be Net Investment paid by the
Agent and the Agent shall be deemed to be the owner of a Transferred Interest
hereunder. Upon the payment of such amount to the Agent (x) by the Transferor,
the amount of the aggregate Net Investment shall be reduced by such amount or
(y) by such Bank Investor, such payment shall constitute such Bank Investor's
payment of its share of the applicable Transfer Price for such Transfer.
(b) Reinvestment Transfers. On each Business Day occurring
after the initial Incremental Transfer hereunder and prior to the Termination
Date, the Transferor hereby agrees to convey, transfer and assign to the Agent,
on behalf of the Investors, and in consideration of Transferor's agreement to
maintain at all times prior to the Termination Date a Net Receivables Balance in
an amount at least sufficient to maintain the Percentage Factor at an amount not
greater than the Maximum Percentage Factor, the Agent may, on behalf of each
Conduit Investor (unless such Conduit Investor has otherwise directed the Agent)
and shall, on behalf of each of the Bank Investors, agree to purchase from the
Transferor undivided percentage ownership interests in each and every
Receivable, together with Related Security, Collections and Proceeds with
respect thereto, to the extent that Collections are available for such Transfer
in accordance with Section 2.5 hereof, such that after giving effect to such
Transfer, (i) the amount of the Net Investment at the close of business on such
Business Day shall be equal to the amount of the Net Investment at the close of
the business on the Business Day immediately preceding such Business Day plus
the Transfer Price of any Incremental Transfer made on such day, if any, and
(ii) the Transferred Interest in each Receivable, together with Related
Security, Collections and Proceeds with respect thereto, shall be equal to the
Transferred Interest in each other Receivable, together with Related Security,
Collections and Proceeds with respect thereto.
(c) All Transfers. Each Transfer shall constitute a purchase
by the Agent, on behalf of the applicable Investors, of undivided percentage
ownership interests in each and every Receivable, together with Related
Security, Collections and Proceeds with respect thereto, then existing, as well
as in each and every Receivable, together with Related Security, Collections and
Proceeds with respect thereto, which arises at any time after the date of such
Transfer. The Agent's aggregate undivided percentage ownership interest in the
Receivables, together with the Related Security, Collections and Proceeds with
respect thereto, held on behalf of the applicable Investors, shall equal the
Percentage Factor in effect from time to time. The Agent shall hold the
Transferred Interests on behalf of the applicable Investors in accordance with
each such Investor's percentage interest in the Transferred Interest (determined
on the basis of the relationship that the portion of the Net Investment funded
by such Investor bears to the aggregate Net Investment of all Investors at such
time).
(d) Certificate. The Transferor has issued to the Agent the
Certificate, in the form of the Exhibit M. The Certificate remains in full force
and effect and is hereby ratified and confirmed.
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(e) Percentage Factor. The Percentage Factor shall be computed
by the Collection Agent as of the opening of business of the Collection Agent on
the effective date of this Agreement. Thereafter until the Termination Date, the
Collection Agent shall recompute the Percentage Factor at the time of each
Incremental Transfer pursuant to Section 2.2(a) and as of the close of business
of the Collection Agent on each Business Day (other than a day after the
Termination Date) and report such recomputation to the Agent monthly, in the
Investor Report, and at such other times as may be requested by the Agent. The
Percentage Factor shall remain constant from the time as of which any such
computation or recomputation is made until the time as of which the next such
recomputation, if any, shall be made, notwithstanding any additional Receivables
arising, any Incremental Transfer made pursuant to Section 2.2(a) or any
Reinvestment Transfer made pursuant to Sections 2.2(b) and 2.5 during any period
between computations of the Percentage Factor. The Percentage Factor, as
computed as of the close of business on the Business Day immediately preceding
the Termination Date, shall remain constant at all times on and after the
Termination Date until the date on which the Net Investment has been reduced to
zero, and all accrued Discount and Servicing Fees have been paid in full and all
other Aggregate Unpaids have been paid in full at which time the Percentage
Factor shall be recomputed in accordance with Section 2.6.
SECTION 2.3. Selection of Tranche Periods and Tranche Rates.
(a) Prior to the Termination Date; Transferred Interest held
on behalf of a Conduit Investor. At all times hereafter, but prior to the
Termination Date with respect to any portion of the Transferred Interest held on
behalf of a Conduit Investor, the Transferor may, subject to such Conduit
Investor's approval and the limitations described below, request Tranche Periods
and allocate a portion of the Net Investment held by such Conduit Investor to
each selected Tranche Period, so that the aggregate amounts allocated to
outstanding Tranche Periods with respect to such Conduit Investor at all times
shall equal the Net Investment held on behalf of such Conduit Investor. The
Transferor shall give each Conduit Investor irrevocable notice by telephone of
the new requested Tranche Period(s) applicable to such Conduit Investor at least
three (3) Business Days prior to the expiration of any then existing Tranche
Period with respect to such Conduit Investor; provided, however, that each
Conduit Investor may select, in its sole discretion, any such new Tranche Period
if (i) the Transferor fails to provide such notice on a timely basis or (ii)
such Conduit Investor determines, in its sole discretion, that the Tranche
Period requested by the Transferor is unavailable or for any reason commercially
undesirable. Each Conduit Investor confirms that it is its intention to allocate
all or substantially all of the Net Investment held on behalf of it to one or
more CP Tranche Periods, provided that such Conduit Investor may determine, from
time to time, in its sole discretion, that funding such Net Investment by means
of one or more CP Tranche Periods is not possible or is not desirable for any
reason. If any Liquidity Provider acquires from a Conduit Investor a Purchased
Interest with respect to the Receivables pursuant to the terms of a Liquidity
Provider Agreement, then the Administrative Agent for such Conduit Investor, on
behalf of the applicable Liquidity Provider, may exercise the right of selection
granted to such Conduit Investor hereby. The initial Tranche Period applicable
to any such Purchased Interest shall be a period of not greater than 14 days and
such Tranche shall be a BR Tranche. Thereafter, provided that the Termination
Date shall not have occurred, the Tranche Period applicable thereto shall be the
BR Rate or the Eurodollar
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Rate, as determined by the applicable Administrative Agent. In the case of any
Tranche Period outstanding upon the Termination Date, such Tranche Period shall
end on such date.
(b) After the Termination Date; Transferred Interest Held on
behalf of a Conduit Investor. At all times on and after the Termination Date,
with respect to any portion of the Transferred Interest which shall be held by
the Agent on behalf of a Conduit Investor, such Conduit Investor or its
Administrative Agent, as applicable, shall select all Tranche Periods and
Tranche Rates applicable thereto.
(c) Prior to the Termination Date; Transferred Interest Held
on Behalf of Bank Investor. At all times with respect to any portion of the
Transferred Interest held by the Agent on behalf of the Bank Investors in any
Related Group, but prior to the Termination Date, the initial Tranche Period
applicable to such portion of the Net Investment allocable thereto shall be a
period of not greater than 14 days and such Tranche shall be a BR Tranche.
Thereafter, with respect to such portion, and with respect to any other portion
of the Transferred Interest held on behalf of the Bank Investors (or any of
them) in any Related Group, provided that the Termination Date shall not have
occurred, the Tranche Period applicable thereto shall be, at the Transferor's
option, either a BR Tranche or a Eurodollar Tranche. The Transferor shall give
the Administrative Agent for each Related Group irrevocable notice by telephone
of the new requested Tranche Period applicable to the Bank Investors in such
Related Group at least three (3) Business Days prior to the expiration of any
then existing Tranche Period applicable to such Related Group and, if the
Transferor shall fail to provide such notice, the applicable Administrative
Agent on behalf of the Bank Investors in such Related Group may, in its sole
discretion, select the new Tranche Period in respect of the applicable Tranche.
In the case of any Tranche Period outstanding upon the occurrence of the
Termination Date, such Tranche Period shall end on the date of such occurrence.
(d) After the Termination Date; Transferred Interest Held on
behalf of Bank Investor. At all times on and after the Termination Date, with
respect to any portion of the Transferred Interest held by the Agent on behalf
of the Bank Investors in any Related Group, the Administrative Agent for such
Related Group shall select all Tranche Periods and Tranche Rates applicable
thereto.
(e) Eurodollar Rate Protection; Illegality. (i) If the
Administrative Agent for any Related Group is unable to obtain on a timely basis
the information necessary to determine the LIBOR Rate for any proposed
Eurodollar Tranche, then
(A) such Administrative Agent shall forthwith notify the Conduit
Investors or Bank Investors in such Related Group, as applicable and the
Transferor that the Eurodollar Rate cannot be determined for such Eurodollar
Tranche, and
(B) while such circumstances exist, neither such Administrative
Agent nor any of the Investors in such Related Group shall allocate the
Net Investment of any additional Transferred Interests purchased during
such period or reallocate the Net Investment allocated to any then
existing Tranche ending during such period, to a Eurodollar Tranche.
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(ii) If, with respect to any outstanding Eurodollar Tranche, any
Investor on behalf of which the Agent holds any Transferred Interest therein
notifies its Administrative Agent that it is unable to obtain matching deposits
in the London interbank market to fund its purchase or maintenance of such
Transferred Interest or that the Eurodollar Rate applicable to such Transferred
Interest will not adequately reflect the cost to such Investor of funding or
maintaining its respective Transferred Interest for such Tranche Period then
such Administrative Agent shall forthwith so notify the Transferor, whereupon
neither such Administrative Agent nor the Conduit Investor or the Bank Investors
in the Related Group, as applicable, shall, while such circumstances exist,
allocate any Net Investment of any additional Transferred Interest purchased
during such period or reallocate the Net Investment allocated to any Tranche
Period ending during such period, to a Eurodollar Tranche.
(iii) Notwithstanding any other provision of this Agreement, if any
Investor shall notify its Administrative Agent that such Investor has determined
(or has been notified by any Liquidity Provider) that the introduction of or any
change in or in the interpretation of any law or regulation makes it unlawful
(either for such Investor or such Liquidity Provider, as applicable), or any
central bank or other governmental authority asserts that it is unlawful, for
such Investor or such Liquidity Provider, as applicable, to fund the purchases
or maintenance of Transferred Interests at the Eurodollar Rate, then (x) as of
the effective date of such notice from such Investor to its Administrative
Agent, the obligation or ability of the such Investor to fund its purchase or
maintenance of Transferred Interests at the Eurodollar Rate shall be suspended
until such Investor notifies its Administrative Agent that the circumstances
causing such suspension no longer exist and (y) the Net Investment of each
Eurodollar Tranche in which such Investor owns an interest shall either (1) if
such Investor may lawfully continue to maintain such Transferred Interest at the
Eurodollar Rate until the last day of the applicable Tranche Period, be
reallocated on the last day of such Tranche Period to another Tranche Period in
respect of which the Net Investment allocated thereto accrues Discount at a
Tranche Rate other than the Eurodollar Rate or (2) if such Investor shall
determine that it may not lawfully continue to maintain such Transferred
Interest at the Eurodollar Rate until the end of the applicable Tranche Period,
such Investor's share of the Net Investment allocated to such Eurodollar Tranche
shall be deemed to accrue Discount at the Base Rate from the effective date of
such notice until the end of such Tranche Period.
(f) Separate Tranches for Related Groups. In no event shall portions
of the Net Investment held by Investors from different Related Groups be
allocated to the same Tranche.
SECTION 2.4. Discount, Fees and Other Costs and Expenses.
Notwithstanding the limitation on recourse under Section 2.1 hereof, the
Transferor shall pay, as and when due in accordance with this Agreement, all
fees hereunder, Discount (including Discount due any Conduit Investor or any
Bank Investor), all amounts payable pursuant to Article VIII hereof, if any, and
the Servicing Fees. On the last day of each Tranche Period, the Transferor shall
pay to each Administrative Agent, on behalf of the applicable Investors in its
Related Group, an amount equal to the accrued and unpaid Discount for such
Tranche Period together with, in the event the Transferred Interest is held on
behalf of a Conduit Investor, an amount equal to the discount accrued on the
Commercial Paper of such Conduit Investor or its Related CP Issuer to the extent
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such Commercial Paper was issued in order to fund the Transferred Interest in an
amount in excess of the Transfer Price of an Incremental Transfer. The
Transferor shall pay to each Administrative Agent, on behalf of the applicable
Conduit Investor, on each day on which Related Commercial Paper is issued by
such Conduit Investor or its Related CP Issuer (or, if so provided in the
applicable Fee Letter, on the last day of each Tranche Period), the Dealer Fee.
Discount shall accrue with respect to each Tranche on each day occurring during
the Tranche Period related thereto. Nothing in this Agreement shall limit in any
way the obligations of the Transferor to pay the amounts set forth in this
Section 2.4.
SECTION 2.5. Non-Liquidation Settlement and Reinvestment Procedures.
On each day after the date of any Incremental Transfer but prior to the
Termination Date and provided that no Potential Termination Event shall have
occurred and be continuing, the Collection Agent shall, out of the Percentage
Factor of Collections received on or prior to such day and not previously
applied or accounted for: (i) set aside and hold in trust for the Agent, on
behalf of the applicable Investors (or deposit into the Collection Account if so
required pursuant to Section 2.12 hereof), an amount equal to all Discount and
the Servicing Fee accrued through such day and not so previously set aside or
paid and (ii) apply the balance of such Percentage Factor of Collections
remaining after application of Collections as provided in clause (i) of this
Section 2.5 hereof to the Transferor, for the benefit of the Agent, on behalf of
the applicable Investors, to the purchase of additional undivided percentage
interests in each Receivable pursuant to Section 2.2(b) hereof. Any Collections
so set aside as described in clause (i) above shall be allocated among the
Related Groups ratably in proportion to the accrued Discount and Servicing Fee
with respect to the Investors in each such Related Group. On the last day of
each Tranche Period applicable to any portion of the Net Investment held by one
or more Investors in a Related Group, from the amounts set aside as described in
clause (i) of the first sentence of this Section 2.5 hereof that have been
allocated to the Investors in such Related Group, the Collection Agent shall
deposit to the applicable Administrative Agent's account, for the benefit of
such Investors, an amount equal to the accrued and unpaid Discount for such
Tranche Period and shall deposit to its own account an amount equal to the
accrued and unpaid Servicing Fee for such Tranche Period. The applicable
Administrative Agent, upon its receipt of such amounts in such Administrative
Agent's account, shall distribute such amounts to the applicable Conduit
Investor and/or the applicable Bank Investors entitled thereto as set forth
above; provided that if such Administrative Agent shall have insufficient funds
to pay all of the above amounts in full on any such date, such Administrative
Agent shall pay such amounts ratably (based on the amounts owing to each such
Investor) to all such Investors entitled to payment thereof. In addition, the
Collection Agent shall remit to the Transferor at the end of each Tranche
Period, such portion of Collections not allocated to the Agent, on behalf of the
applicable Investors.
SECTION 2.6. Liquidation Settlement Procedures. If at any time on or
prior to the Termination Date, the Percentage Factor is greater than the Maximum
Percentage Factor, then the Transferor shall immediately pay to the
Administrative Agents, for the benefit of the applicable Investors in their
respective Related Groups, from previously received Collections, an aggregate
amount equal to the amount such that, when applied in reduction of the Net
Investment, will result in a Percentage Factor less than or equal to the Maximum
Percentage Factor. Such aggregate amount shall be paid to the Administrative
Agents ratably in accordance with portion of the Net Investment held by their
respective Related Groups. Any amount so paid
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to an Administrative Agent for a Related Group shall be applied to the reduction
of the Net Investment of Tranche Periods applicable to such Related Group
selected by such Administrative Agent. On the Termination Date and on each day
thereafter, and on each day on which a Termination Event or a Potential
Termination Event has occurred and is continuing, the Collection Agent shall set
aside and hold in trust for the Agent, on behalf of the applicable Investors (or
deposit into the Collection Account if so required pursuant to Section 2.12
hereof) the Percentage Factor of all Collections received on such day and shall
set aside and hold in trust for the Transferor such portion of Collections not
allocated to the Agent, on behalf of the applicable Investors. The Collections
so set aside shall be allocated among the Related Groups ratably in accordance
with the portion of the Net Investment held by each such Related Group. On the
Termination Date or the day on which a Termination Event or Potential
Termination Event has occurred and is continuing, the Collection Agent shall
deposit to each Administrative Agent's account, for the benefit of the
applicable Investors, any amounts set aside pursuant to Section 2.5 above which
have been allocated to such Administrative Agent's Related Group as described in
Section 2.5. On the last day of each Tranche Period to occur on or after the
Termination Date, during the continuance of a Termination Event or Potential
Termination Event, the Collection Agent shall deposit to each Administrative
Agent's account to the extent not already so deposited, for the benefit of the
applicable Investors in its Related Group, the amounts so set aside that have
been allocated to the Investors in such Related Group pursuant to this Section
2.6, but not to exceed the sum of (i) the accrued Discount for such Tranche
Period, (ii) the portion of the Net Investment allocated to such Tranche Period,
and (iii) all other Aggregate Unpaids. On such day, the Collection Agent shall
deposit to its account, from the amounts so allocated to the Investors in such
Related Group pursuant to the preceding sentence which remain after payment in
full of the aforementioned amounts, the accrued Servicing Fee for such Tranche
Period. If with respect to any Tranche Period there shall be insufficient funds
on deposit for the Collection Agent to distribute funds in payment in full of
the aforementioned amounts, the Collection Agent shall distribute funds first,
in payment of the accrued Discount for such Tranche Period, second, if the
Transferor, the Seller or any Affiliate of the Transferor or the Seller is not
then the Collection Agent, to the Collection Agent's account, in payment of the
Servicing Fee payable to the Collection Agent to the extent allocable to such
Tranche Period, third, in reduction of the Net Investment allocated to such
Tranche Period fourth, in payment of all fees payable by the Transferor
hereunder to the members of the relevant Related Group, fifth, in payment of all
other Aggregate Unpaids owing to the members of such Related Group and sixth, if
the Transferor, the Seller or any Affiliate of the Transferor or the Seller is
the Collection Agent, to its account as Collection Agent, in payment of the
Servicing Fee payable to such Person as Collection Agent to the extent such
Servicing Fee is allocable to such Tranche Period. The applicable Administrative
Agent, upon its receipt of such amounts in such Administrative Agent's account,
shall distribute such amounts to the Investors in its Related Group entitled
thereto as set forth above; provided that if such Administrative Agent shall
have insufficient funds to pay all of the above amounts in full on any such
date, such Administrative Agent shall pay such amounts in the order of priority
set forth above and, with respect to any such category above for which such
Administrative Agent shall have insufficient funds to pay all amounts owing on
such date, ratably (based on the amounts in such categories owing to such
Persons) among all such Persons entitled to payment thereof.
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Following the later to occur of the Termination Date and the date on
which the Net Investment has been reduced to zero, all accrued Discount and
Servicing Fees have been paid in full and all other Aggregate Unpaids have been
paid in full, (i) the Collection Agent shall recompute the Percentage Factor,
(ii) the Agent, on behalf of the Investors, shall be considered to have
reconveyed to the Transferor all of the right, title and interest in and to the
Affected Assets (including the Transferred Interest) without recourse,
representation or warranty of any type or kind, (iii) the Collection Agent shall
pay to the Transferor any remaining Collections set aside and held by the
Collection Agent pursuant to the third sentence of this Section 2.6 and (iv) the
Agent, on behalf of the Investors, shall execute and deliver to the Transferor,
at the Transferor's expense, such documents or instruments as are necessary to
terminate the Agent's interests in the Affected Assets. Any such documents shall
be prepared by or on behalf of the Transferor. On the last day of each Tranche
Period, the Collection Agent shall remit to the Transferor such portion of
Collections set aside for the Transferor pursuant to this Section 2.6.
SECTION 2.7. Fees. Notwithstanding any limitation on recourse
contained in this Agreement, on the last day of each month the Transferor shall
pay the following non-refundable fees: (i) to each Conduit Investor solely for
its own account, the Program Fee with respect to such Conduit Investor, (ii) to
each Conduit Investor the Facility Fee with respect to the applicable Related
Group for distribution to the Bank Investors in such Related Group and (iii) to
Enterprise the Administrative Fee.
SECTION 2.8. Protection of Ownership Interest of the Investors;
Special Accounts and Concentration Account. (a) The Transferor agrees that it
will, and will cause the Seller to, from time to time, at its expense, promptly
execute and deliver all instruments and documents and take all actions as may be
necessary or as the Agent or any Administrative Agent may reasonably request in
order to perfect or protect the Transferred Interest or to enable the Agent, the
Administrative Agents or the Investors to exercise or enforce any of their
respective rights hereunder. Without limiting the foregoing, the Transferor
will, and will cause the Seller to, upon the request of the Agent, any
Administrative Agent or any of the Investors, in order to accurately reflect
this purchase and sale transaction, execute and file such financing or
continuation statements or amendments thereto or assignments thereof as
permitted pursuant to Section 9.7 hereof as may be requested by the Agent, any
Administrative Agent or any of the Investors and (y) mark its respective master
data processing records and other documents with a legend describing the
conveyance to the Transferor of the Receivables (in the case of the Seller) and
to the Agent, for the benefit of the Investors, of the Transferred Interest. The
Transferor shall, and will cause the Seller to, upon request of the Agent, any
Administrative Agent or any of the Investors obtain such additional search
reports as the Agent, any Administrative Agent or any of the Investors shall
request. To the fullest extent permitted by applicable law, the Agent shall be
permitted to sign and file continuation statements and amendments thereto and
assignments thereof without the Transferor's or the Seller's signature. Carbon,
photographic or other reproduction of this Agreement or any financing statement
shall be sufficient as a financing statement. The Transferor shall not, and
shall not permit the Seller to, change its respective name, identity or
corporate structure (within the meaning of Section 9-402(7) of the UCC as in
effect in any applicable state) nor relocate its respective chief executive
office or any office where Records are kept unless it shall have: (i) given the
Agent and each Administrative Agent at least thirty (30) days prior notice
thereof and (ii) prepared at Transferor's expense and
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delivered to the Agent all financing statements, instruments and other documents
necessary to preserve and protect the Transferred Interest or requested by the
Agent or any Administrative Agent in connection with such change or relocation.
Any filings under the UCC or otherwise that are occasioned by such change in
name or location shall be made at the expense of Transferor.
(b) The Agent is hereby authorized at any time to date, and to
deliver to the Concentration Account Bank, the Concentration Account Notice
delivered hereunder. The Transferor hereby, when the Agent shall deliver the
Concentration Account Notice to the Concentration Account Bank, transfers to the
Agent the exclusive ownership and control of the Concentration Account, and
shall take any further action that the Agent may reasonably request to effect
such transfer. In case any authorized signatory of the Transferor whose
signature shall appear on the Concentration Account Agreement shall cease to
have such authority before the delivery of the Concentration Account Notice,
such signature shall nevertheless be valid and sufficient for all purposes as if
such authority had remained in force at the time of such delivery. The Agent
shall, at the time it delivers the Concentration Account Notice to the
Concentration Account Bank, provide a copy thereof to the Transferor; provided
that the failure on the part of the Agent to provide such notice to the
Transferor shall not affect the validity or effectiveness of the Concentration
Account Notice or impair any rights of the Agent, any Administrative Agent or
any of the Investors hereunder.
(c) In addition and without limiting the authority of the
Agent set forth in subsection (b) above, but subject to subsection (d) below,
the Transferor shall cause each Originating Entity to instruct any or all of the
Special Account Banks (which instructions shall be maintained in full force and
effect at all times) to transfer directly to the Concentration Account all
Collections from time to time on deposit in the applicable Special Accounts on a
daily basis in accordance with the terms set forth in the applicable Special
Account Letter. In the event the Transferor shall at any time determine, for any
of the reasons described in subsection (d) below, that the Transferor or any
Originating Entity shall be unable to comply fully with the requirements of this
subsection (c), the Transferor shall promptly so advise the Agent and each
Administrative Agent, and the Transferor, the Agent and each Administrative
Agent shall commence discussions with a view toward implementing an alternative
arrangement therefor satisfactory to the Agent and each Administrative Agent.
(d) Anything to the contrary herein notwithstanding, all
Medicare or Medicaid payments which are made by an Obligor with respect to any
Receivables shall be collected from such Obligor only by (i) the applicable
Originating Entity or (ii) an agent of such Originating Entity, except to the
extent that an Obligor may be required to submit any such payments directly to a
Person other than such Originating Entity pursuant to a court-ordered assignment
which is valid, binding and enforceable under applicable federal and state
Medicare Regulations and Medicaid Regulations; and neither this Agreement nor
any other Transaction Document shall be construed to permit any other Person, in
violation of applicable Medicare Regulations or Medicaid Regulations to collect
or receive, or to be entitled to collect or receive, any such payments prior to
such Originating Entity's or such agent's receipt thereof.
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SECTION 2.9. Deemed Collections; Application of Payments. (a)
If on any day the Outstanding Balance of a Receivable is either (x) reduced as a
result of any defective, rejected or returned merchandise or services, any
discount, credit, Contractual Adjustment, rebate, dispute, warranty claim,
repossessed or returned goods, chargeback, allowance, any billing adjustment or
other adjustment, or (y) reduced or canceled as a result of a setoff or offset
in respect of any claim by any Person (whether such claim arises out of the same
or a related transaction or an unrelated transaction), the Transferor shall be
deemed to have received on such day a Collection of such Receivable in the
amount of such reduction or cancellation and the Transferor shall pay to the
Collection Agent an amount equal to such reduction or cancellation and such
amount shall be applied by the Collection Agent as a Collection in accordance
with Section 2.5 or 2.6 hereof, as applicable. The Net Investment shall be
reduced by the amount of such payment applied to the reduction of the Net
Investment and actually received by the applicable Administrative Agent.
(b) If on any day any of the representations or
warranties in Article III was or becomes untrue with respect to a Receivable
(whether on or after the date of any transfer of an interest therein to the
Agent or any of the Investors as contemplated hereunder), the Transferor shall
be deemed to have received on such day a Collection on such Receivable in full
and the Transferor shall on such day pay to the Collection Agent an amount equal
to the Outstanding Balance of such Receivable and such amount shall be allocated
and applied by the Collection Agent as a Collection allocable to the Transferred
Interest in accordance with Section 2.5 or 2.6 hereof, as applicable. The Net
Investment shall be reduced by the amount of such payment applied to the
reduction of the Net Investment and actually received by the applicable
Administrative Agent.
(c) Any payment by an Obligor in respect of any
indebtedness owed by it to the Transferor or the Seller shall, except as
otherwise specified by such Obligor or otherwise required by contract or law and
unless otherwise instructed by each Administrative Agent, be applied as a
Collection of any Receivable of such Obligor included in the Transferred
Interest (starting with the oldest such Receivable) or the extent of any amounts
then due and payable thereunder before being applied to any other receivable or
other indebtedness of such Obligor.
SECTION 2.10. Payments and Computations, Etc. All amounts to
be paid or deposited by the Transferor or the Collection Agent hereunder shall
be paid or deposited in accordance with the terms hereof no later than 11:00
a.m. (New York City time) on the day when due in immediately available funds; if
such amounts are payable to the Agent or any Administrative Agent (whether on
behalf of any of the Investors or otherwise) they shall be paid or deposited in
the applicable account indicated in Section 10.3 hereof, until otherwise
notified by the Agent or such Administrative Agent, as the case may be. The
Transferor shall, to the extent permitted by law, pay to each Administrative
Agent, for the benefit of itself and the Investors in its Related Group, upon
demand, interest on all amounts owing to such Administrative Agent or such
Investors not paid or deposited when due hereunder at a rate equal to 2% per
annum plus the Base Rate. All computations of Discount, interest and all per
annum fees hereunder shall be made on the basis of a year of 360 days for the
actual number of days (including the first but excluding the last day) elapsed.
Any computations by an Administrative
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Agent of amounts payable by the Transferor hereunder to such Administrative
Agent or any Investor in its Related Group shall be binding upon all parties
hereto absent manifest error.
SECTION 2.11. Reports. On or prior to the last Business Day of
each month, the Collection Agent shall prepare and forward to the Agent and each
Administrative Agent (i) an Investor Report as of the end of the last day of the
immediately preceding month, (ii) a listing by Primary Payor of all Receivables
together with an analysis as to the aging of such Receivables as of such last
day, (iii) written confirmation that all payments in cash, by way of credits to
intercompany accounts (in the case of purchases made by the Seller from any
Transferring Affiliate) or by way of application of proceeds of advances made
under the Subordinated Note (in the case of purchases made by the Transferor
from the Seller) have been made by the Transferor under the Receivables Purchase
Agreement or by the Seller under the Transferring Affiliate Letter or the BMA
Transfer Agreement, as applicable, in accordance with the respective terms of
such agreement, and (iv) such other information as the Agent or any
Administrative Agent may reasonably request.
SECTION 2.12. Collection Account. The Collection Agent has
established and shall maintain with the Agent a segregated account (the
"Collection Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Agent, on behalf of the
Investors. During the continuance of a Collection Agent Default or a Termination
Event or a Potential Termination Event, the Collection Agent shall remit daily
within forty-eight hours of receipt to the Collection Account all Collections
received with respect to any Receivables. Funds on deposit in the Collection
Account (other than investment earnings) shall be invested by the Agent in
Eligible Investments that will mature so that such funds will be available prior
to the last day of each successive Tranche Period following such investment. On
the last day of each Tranche Period, such funds on deposit, together with all
interest and earnings (net of losses and investment expenses) thereon, in the
Collection Account shall be made available for application in accordance with
the terms of Section 2.6 or otherwise for application toward payments required
to be made hereunder (including Discount) by the Transferor. On the date on
which the Net Investment is zero, all accrued Discount and Servicing Fees have
been paid in full and all other Aggregate Unpaids have been paid in full, any
funds remaining on deposit in the Collection Account shall be paid to the
Transferor.
SECTION 2.13. Sharing of Payments, Etc. If any Investor (for
purposes of this Section only, being a "NPRBI") shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of setoff, or
otherwise) on account of Transferred Interest owned by it (other than pursuant
to Section 2.7, or Article VIII and other than as a result of the differences in
the timing of the applications of Collections pursuant to Section 2.5 or 2.6) in
excess of its ratable share of payments on account of Transferred Interest
obtained by the Investors entitled thereto, such NPRBI shall forthwith purchase
from the other Investors entitled to a share of such amount participations in
the Transferred Interests owned by such other Investors the excess payment
ratably with each such other Investor entitled thereto; provided, however, that
if all or any portion of such excess payment is thereafter recovered from such
NPRBI, such purchase from each such other Investor shall be rescinded and each
such other Investor shall repay to the NPRBI the purchase price paid by such
NPRBI for such participation to the extent of such recovery, together with an
amount equal to such other Investor's ratable
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share (according to the proportion of (a) the amount of such other Investor's
required payment to (b) the total amount so recovered from the NPRBI) of any
interest or other amount paid or payable by the NPRBI in respect of the total
amount so recovered.
SECTION 2.14. Right of Setoff. Without in any way limiting the
provisions of Section 2.13, each Investor is hereby authorized (in addition to
any other rights it may have) at any time after the occurrence of the
Termination Date or during the continuance of a Potential Termination Event to
setoff, appropriate and apply (without presentment, demand, protest or other
notice which are hereby expressly waived) any deposits (other than any deposits
then being held in any Special Account maintained by a Bank Investor as to which
deposits the Bank Investors waive their rights of set-off in respect of the
Aggregate Unpaid) and any other indebtedness held or owing by any Investor to,
or for the account of, the Transferor against the amount of the Aggregate
Unpaids owing by the Transferor to such Investor or to the Agent or any
Administrative Agent on behalf of such Investor (even if contingent or
unmatured).
SECTION 2.15. Additional Transferring Affiliates. (a) If (i)
one or more direct or indirect wholly-owned subsidiaries of NMC (other than the
Transferring Affiliates) now owned or hereafter acquired, is primarily engaged
in the same business as is conducted on the date hereof by the Originating
Entities or (ii) NMC reorganizes its corporate structure such that facilities
generating Receivables on the date hereof (or acquired as contemplated by clause
(i)) are owned by one or more additional wholly-owned subsidiaries of NMC, any
or all of the wholly-owned subsidiaries referred to in clauses (i) and (ii) may,
following 30-days' prior written notice by the Transferor to each Administrative
Agent and with the prior written consent of each Administrative Agent (which
consent shall not be unreasonably withheld or delayed), become Transferring
Affiliates under this Agreement upon delivery to each Administrative Agent of
(x) counterparts of the Transferring Affiliate Letter duly executed by such
subsidiary or subsidiaries and (y) the documents relating to such subsidiary or
subsidiaries of the kind delivered by or on behalf of the Transferring
Affiliates (other than BMA) pursuant to Section 4.1, together with such other
instruments, documents and agreements as any Administrative Agent may reasonably
request in connection therewith.
(b) Upon the addition of any wholly-owned subsidiary of NMC as
a Transferring Affiliate pursuant to subsection (a) above, the provisions of
this Agreement, including Exhibit Q, shall, without further act or
documentation, be deemed amended to apply to such subsidiary to the same extent
as the same apply to the Transferring Affiliates as of the date hereof and the
term "Transferring Affiliate" in this Agreement shall mean and refer to such
subsidiary as well as each then existing Transferring Affiliate.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties of the Transferor.
The Transferor represents and warrants to the Agent, each Administrative Agent
and each Investor that:
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(a) Corporate Existence and Power. The Transferor is
a corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation and has all corporate power and all
material governmental licenses, authorizations, consents and approvals required
to carry on its business in each jurisdiction in which its business is now
conducted. The Transferor is duly qualified to do business in, and is in good
standing in, every other jurisdiction in which the nature of its business
requires it to be so qualified, except where the failure to be so qualified or
in good standing would not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the Transferor of this
Agreement, the Receivables Purchase Agreement, the Fee Letters, the
Certificates, the Transfer Certificates and the other Transaction Documents to
which the Transferor is a party are within the Transferor's corporate powers,
have been duly authorized by all necessary corporate action, require no action
by or in respect of, or filing with, any Official Body or official thereof
(except as contemplated by Section 2.8 hereof), and do not contravene, or
constitute a default under, any provision of applicable law, rule or regulation
(including, without limitation, any CHAMPUS/VA Regulation, any Medicaid
Regulation or any Medicare Regulation) or of the Certificate of Incorporation or
Bylaws of the Transferor or of any agreement, judgment, injunction, order, writ,
decree or other instrument binding upon the Transferor or result in the creation
or imposition of any Adverse Claim on the assets of the Transferor or any of its
Subsidiaries (except as contemplated by Section 2.8 hereof).
(c) Binding Effect. Each of this Agreement, the
Receivables Purchase Agreement, the Fee Letters, the Certificates and the other
Transaction Documents to which the Transferor is a party constitutes and the
Transfer Certificate upon payment of the Transfer Price set forth therein will
constitute the legal, valid and binding obligation of the Transferor,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, moratorium or other similar laws affecting the rights of
creditors generally.
(d) Perfection. Immediately preceding each Transfer
hereunder, the Transferor shall be the owner of all of the Receivables, free and
clear of all Adverse Claims. On or prior to each Transfer and each recomputation
of the Transferred Interest, all financing statements and other documents
required to be recorded or filed, or notices to Obligors to be given, in order
to perfect and protect the Agent's Transferred Interest against all creditors of
and purchasers from the Transferor and the Seller will have been duly filed in
each filing office necessary for such purpose and all filing fees and taxes, if
any, payable in connection with such filings shall have been paid in full.
(e) Accuracy of Information. All information
heretofore furnished by the Transferor (including without limitation, the
Investor Reports, any reports delivered pursuant to Section 2.11 hereof and the
Transferor's financial statements) to any Investor, the Agent or any
Administrative Agent for purposes of or in connection with this Agreement or any
transaction contemplated hereby is, and all such information hereafter furnished
by the Transferor to the any Investor, the Agent or any Administrative Agent
will be, true and accurate in every material respect, on the date such
information is stated or certified.
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(f) Tax Status. The Transferor has filed all tax
returns (federal, state and local) required to be filed and has paid or made
adequate provision for the payment of all taxes, assessments and other
governmental charges.
(g) Action, Suits. Except as set forth in Exhibit H
hereof, there are no actions, suits or proceedings pending, or to the knowledge
of the Transferor threatened, in or before any court, arbitrator or other body,
against or affecting (i) the Transferor or any of its properties or (ii) any
Affiliate of the Transferor or its respective properties, which may, in the case
of proceedings against or affecting any such Affiliate, individually or in the
aggregate, have a Material Adverse Effect.
(h) Use of Proceeds. No proceeds of any Transfer will
be used by the Transferor to acquire any security in any transaction which is
subject to Section 13 or 14 of the Securities Exchange Act of 1934, as amended.
(i) Place of Business. The principal place of
business and chief executive office of the Transferor are located at the address
of the Transferor indicated in Section 10.3 hereof and the offices where the
Transferor keeps substantially all its Records, are located at the address(es)
described on Exhibit I or such other locations notified to each Administrative
Agent in accordance with Section 2.8 hereof in jurisdictions where all action
required by Section 2.8 hereof has been taken and completed. The principal place
of business and chief executive office of each Originating Entity is located at
the address of such Originating Entity indicated in Exhibit I hereof and the
offices where the each Originating Entity keeps substantially all its Records
are located at the address(es) specified on Exhibit I with respect to such
Originating Entity or such other locations notified to each Administrative Agent
in accordance with Section 2.8 hereof in jurisdictions where all action required
by Section 2.8 hereof has been taken and completed.
(j) Good Title. Upon each Transfer and each
recomputation of the Transferred Interest, the Agent shall acquire a valid and
perfected first priority undivided percentage ownership interest to the extent
of the Transferred Interest or a first priority perfected security interest in
each Receivable that exists on the date of such Transfer and recomputation and
in the Related Security and Collections with respect thereto free and clear of
any Adverse Claim.
(k) Tradenames, Etc. As of the date hereof: (i) the
Transferor's chief executive office is located at the address for notices set
forth in Section 10.3 hereof; (ii) the Transferor has no subsidiaries or
divisions; (iii) the Transferor has, within the last five (5) years, not
operated under any tradename, and, within the last five (5) years, has not
changed its name, merged with or into or consolidated with any other corporation
or been the subject of any proceeding under Title 11, United States Code
(Bankruptcy); and (iv) none of the Originating Entities has, within the last
five (5) years, operated under any tradename or, within the last five (5) years,
changed its name, merged with or into or consolidated with any other Person or
been the subject of any proceeding under Title 11, United States Code
(Bankruptcy), except in each case as described on Exhibit H.
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(l) Nature of Receivables. Each Receivable (x)
represented by the Transferor or the Collection Agent to be an Eligible
Receivable (including in any Investor Report or other report delivered pursuant
to Section 2.11 hereof) or (y) included in the calculation of the Net
Receivables Balance is an "eligible asset" as defined in Rule 3a-7 under the
Investment Company Act, of 1940, as amended and, in the case of clause (y)
above, is not a Receivable of the type described in clauses (i) through (iii) of
the definition of "Net Receivables Balance."
(m) Coverage Requirement; Amount of Receivables. The
Percentage Factor does not exceed the Maximum Percentage Factor.
(n) Credit and Collection Policy. Since July 10,
1997, there have been no material changes in the Credit and Collection Policy
other than as permitted hereunder. Since such date, no material adverse change
has occurred in the overall rate of collection of the Receivables.
(o) Collections and Servicing. Since July 10, 1997,
there has been no material adverse change in the ability of the Collection Agent
(to the extent it is the Seller, the Transferor or any Subsidiary or Affiliate
of any of the foregoing) to service and collect the Receivables.
(p) No Termination Event. No event has occurred and
is continuing and no condition exists which constitutes a Termination Event or a
Potential Termination Event.
(q) Not an Investment Company. The Transferor is not,
and is not controlled by, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or is exempt from all provisions of
such Act.
(r) ERISA. Each of the Transferor and its ERISA
Affiliates is in compliance in all material respects with ERISA and no lien
exists in favor of the Pension Benefit Guaranty Corporation on any of the
Receivables.
(s) Special Account Banks and Concentration Bank. The
names and addresses of all the Special Account Banks (and, if applicable, the
Designated Account Agent in respect thereof) and the Concentration Account Bank,
together with the account numbers of the Special Accounts at such Special
Account Banks and the account number of the Concentration Account of the
Transferor at the Concentration Account Bank, are specified in Exhibit C hereto
(or at such other Special Account Banks or Concentration Account Bank, with such
other Special Accounts or Concentration Account or with such other Designated
Account Agents as have been notified to each Administrative Agent in accordance
with Section 5.2(e)). This Agreement, together with the Concentration Account
Agreement, is effective to, and does, transfer to the Agent, for the benefit of
the Investors, all right, title and interest of the Transferor in and to the
Concentration Account. The Transferor has not granted to any Person (other than
the Agent under the Concentration Account Agreement) dominion and control over
the Concentration Account, or the right to take dominion and control over the
Concentration Account at a future time or upon the occurrence of a future event;
neither the Transferor nor any other Parent Group Member has granted to any
Person dominion and control over any Special Account, or the right
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to take dominion or control over any Special Account at a future time or upon
the occurrence of a future event; and the Concentration Account and each Special
Account is otherwise free and clear of any Adverse Claim.
(t) Bulk Sales. No transaction contemplated hereby or
by the Receivables Purchase Agreement requires compliance with any bulk sales
act or similar law.
(u) Transfers Under Receivables Purchase Agreement.
With respect to each Receivable, and Related Security, if any, with respect
thereto, originally owed to the Seller or acquired by the Seller from any
Transferring Affiliate, the Transferor purchased such Receivable and Related
Security from the Seller under the Receivables Purchase Agreement, such purchase
was deemed to have been made on the date such Receivable was credited or
acquired by the Seller and such purchase was made strictly in accordance with
the terms of the Receivables Purchase Agreement.
(v) Preference; Voidability (Receivables Purchase
Agreement). The Transferor has given reasonably equivalent value to the Seller
in consideration for each transfer to the Transferor of Receivables and Related
Security from the Seller, and no such transfer has been made for or on account
of an antecedent debt owed by the Seller to the Transferor and no such transfer
is or may be voidable under any Section of the Bankruptcy Code.
(w) Transfers by Transferring Affiliates. With
respect to each Receivable, and Related Security, if any, with respect thereto,
originally owed to any Transferring Affiliate, the Seller (i) purchased such
Receivable and Related Security from such Transferring Affiliate under the
Transferring Affiliate Letter or from BMA under the BMA Transfer Agreement, such
purchase being deemed to have been made on the date such Receivable was created
(or, in the case of a Receivable outstanding on the Closing Date, on the Closing
Date), (ii) by the last Business Day of the month following the month in which
such purchase was so made, paid to the applicable Transferring Affiliate in cash
or by way of a credit to such Transferring Affiliate in the appropriate
intercompany account, an amount equal to the face amount of such Receivable and
(iii) settled from time to time each such credit, by way of payments in cash, or
by way of credits in amounts equal to cash expended, obligations incurred or the
value of services or property provided by or on behalf of the Seller, in each
case for the benefit of such Transferring Affiliate, to the account of such
Transferring Affiliate in accordance with the Seller's and such Transferring
Affiliate's cash management and accounting policies.
(x) Preference; Voidability (Transferring
Affiliates). The Seller has given reasonably equivalent value to each
Transferring Affiliate in consideration for each transfer to the Seller of
Receivables and Related Security from such Transferring Affiliate, and no such
transfer has been made for or on account of an antecedent debt owed by such
Transferring Affiliate to the Seller and no such transfer is or may be voidable
under any Section of the Bankruptcy Code.
(y) Ownership. FMC owns, directly or indirectly, all
of the issued and outstanding common stock of (and such stock comprises more
than 80% of the Voting Stock of) FMCH, free and clear of any Adverse Claim
except to the extent such stock is pledged in
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connection with the Bank Revolver. All of the issued and outstanding stock of
each Originating Entity is owned directly or indirectly by FMCH, free and clear
of any Adverse Claim except to the extent such stock is pledged in connection
with the Bank Revolver. All of the issued and outstanding stock of the
Transferor is owned by NMC, free and clear of any Adverse Claim.
(z) Representations and Warranties of the Seller.
Each of the representations and warranties of the Seller set forth in Section
3.1 of the Receivables Purchase Agreement are true and correct in all material
respects and the Transferor hereby remakes all such representations and
warranties for the benefit of the Agent, each of the Investors and each
Administrative Agent.
(aa) Year 2000 Compliance. The Transferor has (i)
initiated a review and assessment of all areas within its and each of its
Subsidiaries' business and operations (including those affected by suppliers,
vendors and customers) that could be adversely affected by the `Year 2000
Problem' (that is, the risk that computer applications used by the Transferor or
any of its Subsidiaries (or suppliers, vendors and customers) may be unable to
recognize and perform properly date-sensitive functions involving certain dates
prior to and any date after December 31, 1999), (ii) initiated the development
of a plan and timeline for addressing the Year 2000 Problem on a timely basis,
and (iii) to date, implemented that plan in accordance with that timetable. The
Transferor believes that all computer applications (including those of its
suppliers, vendors and customers) that are material to its or any of its
Subsidiaries' business and operations are reasonably expected on a timely basis
to be able to perform properly date-sensitive functions for all dates before and
after January 1, 2000 (that is, be `Year 2000 Compliant'), except to the extent
that a failure to do so could not reasonably be expected (a) to have a Material
Adverse Effect on the Transferor or on the transaction documented under this
Agreement, or (b) to result in a Termination Event.
The Transferor (i) has initiated a review and assessment of
all computer applications (including, but not limited to, those of the
Transferor, the Collection Agent, the Seller, any Transferring Affiliate and any
of their respective suppliers, vendors, customers or third party servicers),
which are related to or involved in the origination, collection, management or
servicing of the Receivables (the `Receivable Systems') and (ii) believes that
such Receivable Systems are Year 2000 Compliant or will be Year 2000 Compliant
on or before April 1, 1999 and thereafter.
The Transferor believes that the costs of all assessment,
remediation, testing and integration related to the Transferor's plan for
becoming Year 2000 Compliant will not have a material adverse effect on the
financial condition or operations of the Transferor.
Any document, instrument, certificate or notice delivered by
the Transferor to any Conduit Investor, Administrative Agent or the Agent
hereunder shall be deemed a representation and warranty by the Transferor.
SECTION 3.2. Reaffirmation of Representations and Warranties
by the Transferor. On each day that a Transfer is made hereunder, the
Transferor, by accepting the proceeds of such Transfer, whether delivered to the
Transferor pursuant to Section 2.2(a) or
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Section 2.5 hereof, shall be deemed to have certified that all representations
and warranties described in Section 3.1 hereof are correct on and as of such day
as though made on and as of such day. Each Incremental Transfer shall be subject
to the further conditions precedent that:
(a) prior to the date of such Incremental Transfer,
the Collection Agent shall have delivered to the Agent and each
Administrative Agent, in form and substance satisfactory to the Agent
and each Administrative Agent, a completed Investor Report dated within
ten (10) days prior to the date of such Incremental Transfer, together
with a listing by Primary Payor of all Receivables, and such additional
information as may be reasonably requested by any Administrative Agent
or the Agent;
(b) on date of such Incremental Transfer, either (i)
FMCH's long-term public senior debt securities are rated as least B- by
Standard & Poor's and B3 by Moody's, or if neither Standard & Poor's
nor Moody's shall rate such securities, FMCH's long-term senior debt
shall have a deemed rating of at least B as determined by each
Administrative Agent using its standard bond rating methodology, or
(ii) FMC's long-term public senior debt securities are rated as least
B- by Standard & Poor's and B3 by Moody's Investors Service, or if
neither Standard & Poor's nor Moody's shall rate such securities, FMC's
long-term senior debt shall have deemed rating of at least B as
determined by each Administrative Agent using its standard bond rating
methodology,
and the Transferor shall be deemed to have represented and warranted that such
conditions precedent have been satisfied.
SECTION 3.3. Representations and Warranties of the Collection
Agent. The Collection Agent represents and warrants to the Agent, each
Administrative Agent and each or the Investors that:
(a) Corporate Existence and Power. The Collection
Agent is a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation and has all corporate power
and all material governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its business is
now conducted. The Collection Agent is duly qualified to do business in, and is
in good standing in, every other jurisdiction in which the nature of its
business requires it to be so qualified, except where the failure to be so
qualified or in good standing would not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization;
Contravention. The execution, delivery and performance by the Collection Agent
of this Agreement are within the Collection Agent's corporate powers, have been
duly authorized by all necessary corporate action, require no action by or in
respect of, or filing with, any Official Body or official thereof, and do not
contravene, or constitute a default under, any provision of applicable law, rule
or regulation (including, without limitation, any CHAMPUS/VA Regulation, any
Medicaid Regulation or any Medicare Regulation) or of the Certificate of
Incorporation or Bylaws of the Collection Agent or of any agreement, judgment,
injunction, order, writ, decree or other
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instrument binding upon the Collection Agent or result in the creation or
imposition of any Adverse Claim on the assets of the Collection Agent or any of
its Subsidiaries.
(c) Binding Effect. This Agreement constitutes the
legal, valid and binding obligation of the Collection Agent, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium or similar laws affecting the rights of creditors.
(d) Accuracy of Information. All information
heretofore furnished by the Collection Agent to the Agent, any Investor or any
Administrative Agent for the purposes of or in connection with this Agreement or
any transaction contemplated hereby is, and all such information hereafter
furnished by the Collection Agent to the Agent, any Investor or any
Administrative Agent will be, true and accurate in every material respect, on
the date such information is stated or certified.
(e) Action, Suits. Except as set forth in Exhibit H,
there are no actions, suits or proceedings pending, or to the knowledge of the
Collection Agent threatened, against or affecting the Collection Agent or any
Affiliate of the Collection Agent or their respect properties, in or before any
court, arbitrator or other body, which may, individually or in the aggregate,
have a Material Adverse Effect.
(f) Nature of Receivables. Each Receivable included
in the calculation of the Net Receivables Balance is not a Receivable of the
type described in clauses (i) through (iii) of the definition of "Net
Receivables Balance".
(g) Amount of Receivables. The Percentage Factor does
not exceed the Maximum Percentage Factor.
(h) Credit and Collection Policy. Since July 10,
1997, there have been no material changes in the Credit and Collection Policy
other than as permitted hereunder. Since such date, no material adverse change
has occurred in the overall rate of collection of the Receivables.
(i) Collections and Servicing. Since July 10, 1997,
there has been no material adverse change in the ability of the Collection Agent
to service and collect the Receivables.
(j) Not an Investment Company. The Collection Agent
is not, and is not controlled by, an "investment company" within the meaning of
the Investment Company Act of 1940, as amended, or is exempt from all provisions
of such Act.
(k) Special Accounts and Concentration Account. The
names and addresses of all the Special Account Banks (and, if applicable, the
Designated Account Agent in respect thereof) and the Concentration Account Bank,
together with the account numbers of the Special Accounts at such Special
Account Banks and the account number of the Concentration Account of the
Transferor at the Concentration Account Bank, are specified in Exhibit C hereto
(or at such other Special Account Banks or Concentration Account Bank, with such
other Special
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Accounts or Concentration Account or with such other Designated Account Agents
as have been notified to the Agent in accordance with Section 5.2(e)).
(l) Year 2000 Compliance. The Collection Agent has
(i) initiated a review and assessment of all areas within its, the Seller's and
each Transferring Affiliate's business and operations (including those affected
by suppliers, vendors and customers) that could be adversely affected by the
`Year 2000 Problem' (that is, the risk that computer applications used by the
Collection Agent, the Seller or any Transferring Affiliate (or suppliers,
vendors and customers) may be unable to recognize and perform properly
date-sensitive functions involving certain dates prior to and any date after
December 31, 1999), (ii) initiated the development of a plan and timeline for
addressing the Year 2000 Problem on a timely basis, and (iii) to date,
implemented that plan in accordance with that timetable. The Collection Agent
believes that all computer applications (including those of its suppliers,
vendors and customers) that are material to its, the Seller's or any
Transferring Affiliate's business and operations are reasonably expected on a
timely basis to be Year 2000 Compliant, except to the extent that a failure to
do so could not reasonably be expected (a) to have a Material Adverse Effect on
the Collection Agent, the Seller or any Transferring Affiliate or on the
transactions contemplated by the Transaction Documents, or (b) to result in a
Termination Event.
The Collection Agent (i) has initiated a review and assessment
of all Receivable Systems and (ii) believes that such Receivable Systems are
Year 2000 Compliant or will be Year 2000 Compliant on or before April 1, 1999
and thereafter.
The Collection Agent believes that the costs of all
assessment, remediation, testing and integration related to the Collection
Agent's plan for becoming, and causing the Seller and each Transferring
Affiliate to become, Year 2000 Compliant will not have a material adverse effect
on the financial condition or operations of the Collection Agent, the Seller or
any Transferring Affiliate.
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.1. Conditions to Closing. On or prior to the date of
execution hereof, the Transferor shall deliver to each Administrative Agent the
following documents, instruments and fees all of which shall be in a form and
substance acceptable to each Administrative Agent:
(a) A copy of the resolutions of the Board of
Directors of the Transferor certified by its Secretary approving the execution,
delivery and performance by the Transferor of this Agreement, the Receivables
Purchase Agreement and the other Transaction Documents to be delivered by the
Transferor hereunder or thereunder.
(b) A copy of the resolutions of the Board of
Directors of the Collection Agent certified by its Secretary approving the
execution, delivery and performance by
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the Collection Agent of this Agreement and the other Transaction Documents to be
delivered by the Collection Agent hereunder or thereunder.
(c) The Articles of Incorporation of the Transferor
certified by the Secretary of State or other similar official of the
Transferor's jurisdiction of incorporation dated a date reasonably prior to the
Closing Date.
(e) The Articles of Incorporation of the Collection
Agent certified by the Secretary of State or other similar official of the
Collection Agent's jurisdiction of incorporation dated a date reasonably prior
to the Closing Date.
(f) A Good Standing Certificate for the Transferor
issued by the Secretary of State or a similar official of the Transferor's
jurisdiction of incorporation and certificates of qualification as a foreign
corporation issued by the Secretaries of State or other similar officials of
each jurisdiction where such qualification is material to the transactions
contemplated by this Agreement and the other Transaction Documents, in each
case, dated a date reasonably prior to the Closing Date.
(g) A Good Standing Certificate for the Collection
Agent issued by the Secretary of State or a similar official of the Collection
Agent's jurisdiction of incorporation and certificates of qualification as a
foreign corporation issued by the Secretaries of State or other similar
officials of each jurisdiction when such qualification is material to the
transactions contemplated by this Agreement and the Receivables Purchase
Agreement and the other Transaction Documents, in each case, dated a date
reasonably prior to the Closing Date.
(h) A Certificate of the Secretary of the Transferor
substantially in the form of Exhibit L attached hereto.
(i) A Certificate of the Secretary of the Collection
Agent substantially in the form of Exhibit L attached hereto.
(j) Copies of proper financing statements (Form
UCC-1), dated a date reasonably near to the Closing Date naming the Transferor
as the debtor in favor of the Agent, for the benefit of the Investors, as the
secured party or other similar instruments or documents as may be necessary or
in the reasonable opinion of the Agent desirable under the UCC of all
appropriate jurisdictions or any comparable law to perfect the Agent's undivided
percentage interest in all Receivables and the Related Security and Collections
relating thereto.
(k) An opinion of Douglas G. Kott, Associate General
Counsel for FMCH, NMC and each Transferring Affiliate, acting as counsel to FMC,
FMCH, the Transferor, the Collection Agent and the Originating Entities, in the
respective form attached in Exhibit K hereto.
(l) An opinion of Arent Fox Kintner Plotkin & Kahn,
PLLC special counsel to FMC, FMCH, the Transferor and the Seller, covering
certain bankruptcy and general corporate matters in the respective forms
attached in Exhibit K hereto.
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(m) An opinion of Nutter, McClennen & Fish, LLP,
special Massachusetts counsel to the Transferor and the Originating Entities, in
the respective form attached in Exhibit K hereto.
(n) Computer tapes or digital records setting forth
all Receivables and the Outstanding Balances thereon and such other information
as the Agent may reasonably request.
(o) An executed copy of this Agreement, the Fee
Letters and each of the other Transaction Documents to be executed by the
Transferor, any Originating Entity or the Collection Agent.
(t) An Amendment to the Parent Agreement, duly
executed by each of FMCH and FMC, in the form attached hereto as Exhibit T.
(u) An Assignment Agreement duly executed and
delivered by Enterprise and Compass reflecting the assignment by Enterprise to
Compass of a portion of the Net Investment in the amount of $162,500,000.
(v) Confirmation from each of S&P and Moody's that
the execution and delivery of this Agreement and the transactions contemplated
hereby will not result in the reduction or withdrawal of the then current rating
of the Commercial Paper issued by Compass or its Related CP Issuer.
(w) Such other documents, instruments, certificates
and opinions as the Agent or any Administrative Agent shall reasonably request
including each of the documents, instruments, certificates and opinion
identified on the List of Closing Documents attached hereto as Exhibit S.
ARTICLE V
COVENANTS
SECTION 5.1. Affirmative Covenants of Transferor. At all times
from the date hereof to the later to occur of (i) the Termination Date or (ii)
the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless each Administrative Agent
shall otherwise consent in writing:
(a) Financial Reporting. The Transferor will, and
will cause the Seller and each of the Transferring Affiliates to, maintain, for
itself and each of its respective Subsidiaries, a system of accounting
established and administered in accordance with GAAP, and furnish to each
Administrative Agent:
(i) Annual Reporting. As soon as available, but in
any event within ninety-five (95) days after the end of each fiscal
year of the Transferor, financial statements for the Transferor,
including a balance sheet as of the end of
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such period, the related statement of income, retained earnings,
shareholders' equity and cash flows for such year prepared by the
Transferor in accordance with GAAP and reviewed by a nationally
recognized accounting firm accompanied by a certificate of said
accountants that, in the course of the foregoing, they have obtained no
knowledge of any Termination Event or Potential Termination Event, or
if, in the opinion of such accountants, any Termination Event or
Potential Termination Event shall exist, stating the nature and status
thereof.
(ii) Quarterly Reporting. As soon as available, but
in any event within fifty (50) days after the end of each of the first
three quarterly periods of the Transferor's fiscal years, financial
statements for the Transferor, including a balance sheet as at the
close of each such period and a related statement of income and
retained earnings for the period from the beginning of such fiscal year
to the end of such quarter, all certified by its chief executive
officer or its senior financial officer.
In the case of each of the financial statements
required to be delivered under clause (i) or (ii) above, such financial
statement shall set forth in comparative form the figures for the
corresponding period or periods of the preceding fiscal year or the
portion of the fiscal year ending with such period, as applicable (but
not for any period prior to the Closing Date), in each case subject to
normal recurring year-end audit adjustments. Each such financial
statement shall be prepared in accordance with GAAP consistently
applied.
(iii) Compliance Certificate. Together with the
financial statements required hereunder, a compliance certificate
signed by the Transferor's chief executive officer or its senior
financial officer stating that (x) the attached financial statements
have been prepared in accordance with GAAP and accurately reflect the
financial condition of the Transferor and (y) to the best of such
Person's knowledge, no Termination Event or Potential Termination Event
exists, or if any Termination Event or Potential Termination Event
exists, stating the nature and status thereof.
(iv) Notice of Termination Events or Potential
Termination Events. As soon as possible and in any event within two (2)
days (or the next Business Day thereafter if such day is not a Business
Day) after the occurrence of each Termination Event or each Potential
Termination Event, a statement of the chief executive officer or the
senior financial officer of the Transferor setting forth details of
such Termination Event or Potential Termination Event and the action
which the Transferor proposes to take with respect thereto.
(v) Change in Credit and Collection Policy and Debt
Ratings. Within ten (10) days after the date any material change in or
amendment to the Credit and Collection Policy is made, a copy of the
Credit and Collection Policy then in effect indicating such change or
amendment.
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(vi) Credit and Collection Policy. Within ninety (90)
days after the close of each of the Seller's and the Transferor's
fiscal years, a complete copy of the Credit and Collection Policy then
in effect.
(vii) ERISA. Promptly after the filing or receiving
thereof, copies of all reports and notices with respect to any
Reportable Event (as defined in Article IV of ERISA) which the
Transferor, the Seller or any ERISA Affiliate of the Transferor or the
Seller files under ERISA with the Internal Revenue Service, the Pension
Benefit Guaranty Corporation or the U.S. Department of Labor or which
the Transferor, the Seller or any ERISA Affiliates of the Transferor or
the Seller receives from the Internal Revenue Service, the Pension
Benefit Guaranty Corporation or the U.S. Department of Labor.
(viii) Notices under Transaction Documents. Forthwith
upon its receipt thereof, a copy of each notice, report, financial
statement, certification, request for amendment, directive, consent,
waiver or other modification or any other writing issued under or in
connection with any other Transaction Document by any party thereto
(including, without limitation, by the Transferor).
(ix) Investigations and Proceedings. Unless
prohibited by either (i) the terms of the subpoena, request for
information or other document referred to below, (ii) law (including,
without limitation, rules and regulations) or (iii) restrictions
imposed by the U.S. federal or state government or any agency or
instrumentality thereof and subject to the execution by the applicable
Administrative Agent of a confidentiality agreement in form and
substance satisfactory to both the Transferor and such Administrative
Agent, as soon as possible and in any event (A) within three Business
Days after the Transferor (or within five Business Days after any
Originating Entity) receives any subpoena, request for information, or
any other document relating to any possible violation by the Transferor
or any Originating Entity of, or failure by the Transferor or any
Originating Entity to comply with, any rule, regulation or statute from
HHS or any other governmental agency or instrumentality, notice of such
receipt and, if requested by the Agent, the information contained in,
or copies of, such subpoena, request or other document, and (B)
periodic updates and other management reports relating to the
subpoenas, requests for information and other documents referred to in
clause (A) above as may be reasonably requested by any Administrative
Agent unless such updates or requests could reasonably be deemed a
contravention or waiver of any available claim of legal privilege, or
would otherwise materially impair available defenses, of the Transferor
or any Originating Entity.
(x) Other Information. Such other information
(including non-financial information) as the Agent or amu
Administrative Agent may from time to time reasonably request with
respect to the Seller, the Transferor, any party to the Parent
Agreement, any Transferring Affiliate or any Subsidiary of any of the
foregoing.
(b) Conduct of Business. The Transferor (i) will
carry on and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as
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it is presently conducted and do all things necessary to remain duly
incorporated, validly existing and in good standing as a domestic corporation in
its jurisdiction of incorporation and maintain all requisite authority to
conduct its business in each jurisdiction in which its business is conducted and
(ii) will cause each Originating Entity to do each of the foregoing in respect
of such Originating Entity.
(c) Compliance with Laws. The Transferor will, and
will cause each Originating Entity to, comply with all laws, rules and
regulations (including, without limitation, all CHAMPUS/VA Regulations, Medicaid
Regulations and Medicare Regulations), and all orders, writs, judgments,
injunctions, decrees or awards to which it or its respective properties may be
subject.
(d) Furnishing of Information and Inspection of
Records. The Transferor will, and will cause each Originating Entity to, furnish
to each Administrative Agent from time to time such information with respect to
the Receivables as such Administrative Agent may reasonably request, including,
without limitation, listings identifying the Obligor and the Outstanding Balance
for each Receivable. The Transferor will, and will cause each Originating Entity
to, at any time and from time to time during regular business hours permit any
Administrative Agent, or its agents or representatives, (i) to examine and make
copies of and take abstracts from Records and (ii) to visit the offices and
properties of the Transferor or such Originating Entity, as applicable, for the
purpose of examining such Records, and to discuss matters relating to
Receivables or the Transferor's or such Originating Entity's performance
hereunder and under the other Transaction Documents to which such Person is a
party with any of the officers, directors, employees or independent public
accountants of the Transferor or such Originating Entity, as applicable, having
knowledge of such matters; provided, however, that each Administrative Agent
acknowledges that in exercising the rights and privileges conferred in this
Section 5.1(d) it or its agents or representatives may, from time to time,
obtain knowledge of information, practices, books, correspondence and records
("Confidential Information") identified to it in writing as being of a
confidential nature or in which the Transferor or an Originating Entity has a
proprietary interest. Each Administrative Agent agrees that all such
Confidential Information so obtained by it is to be regarded as confidential
information and that such Confidential Information may be subject to laws, rules
and regulations regarding patient confidentiality, and agrees that (x) it shall
retain in confidence, and shall ensure that its agents and representatives
retain in confidence, and will not disclose, any of such Confidential
Information without the prior written consent of the Transferor and (y) it will
not, and will ensure that its agents and representatives will not, make any use
whatsoever (other than for purposes of this Agreement) of any of such
Confidential Information without the prior written consent of the Transferor;
provided, however, that such Confidential Information may be disclosed to the
extent that such Confidential Information (i) may be or becomes generally
available to the public (other than as a breach of this Section 5.1(d)), (ii) is
required or appropriate in response to any summons or subpoena in connection
with any litigation or (iii) is required by law to be disclosed; and provided,
further, however, that such Confidential Information may be disclosed to (A) the
Agent, any Administrative Agent, any Investor, any Credit Support Provider and
any Liquidity Provider, subject to the terms of this Section 5.1(d), (B) any
such Person's legal counsel, auditors and other business advisors, (C) any such
Person's government regulators and (D) the rating agencies rating any Commercial
Paper issued by a
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Conduit Investor or its Related CP Issuer, provided that the Person making such
disclosure shall advise each recipient thereof referred to in clauses (A), (B),
(C) and (D) above that such Confidential Information is to be regarded and
maintained as confidential information and that each Administrative Agent has
agreed to keep confidential such Confidential Information as provided in clauses
(x) and (y) above.
(e) Keeping of Records and Books of Account. The
Transferor will, and will cause each Originating Entity to, maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing Receivables in the event
of the destruction of the originals thereof), and keep and maintain, all
documents, books, records and other information reasonably necessary or
advisable for the collection of all Receivables (including, without limitation,
records adequate to permit the daily identification of each new Receivable and
all Collections of and adjustments to each existing Receivable). The Transferor
will, and will cause each Originating Entity to, give each Administrative Agent
notice of any material change in the administrative and operating procedures of
the Transferor or such Originating Entity, as applicable, referred to in the
previous sentence.
(f) Performance and Compliance with Receivables and
Contracts. The Transferor, at its expense, will, and will cause each Originating
Entity to, timely and fully perform and comply with all material provisions,
covenant and other promises required to be observed by the Transferor or such
Originating Entity under the Contracts related to the Receivables.
(g) Credit and Collection Policies. The Transferor
will, and will cause each Originating Entity to, comply in all material respects
with the Credit and Collection Policy in regard to each Receivable and the
related Contract.
(h) Special Accounts; Concentration Account. The
Transferor shall (i) cause each Originating Entity to establish and maintain
Special Accounts with Special Account Banks, or to engage a Designated Account
Agent to maintain a Special Account with a Special Account Bank on its behalf,
(ii) instruct, and cause each Originating Entity to instruct, all Obligors to
cause all collections to be deposited directly into a Special Account, (iii)
report, and cause each Originating Entity to report, on each banking day to the
Concentration Account Bank, the amount of all Collections on deposit on such
banking day in the Special Accounts at each Special Account Bank, (iv) establish
and maintain a Concentration Account with the Concentration Account Bank, (v)
instruct, and cause each Originating Entity to instruct (or to cause the
applicable Designated Account Agent to instruct), each Special Account Bank to
transfer to the Concentration Account prior to the close of business on such
banking day all Collections on deposit during such banking day in the Special
Accounts at such Special Account Bank, and (vi) instruct the Concentration
Account Bank to give to each Special Account Bank on each banking day notice to
transfer to the Concentration Account all Collections on deposit during such
banking day in the Special Accounts at such Special Account Bank; provided,
however, that if the Collections on deposit in any Special Account during such
banking day shall be less than $5,000.00 (the "Minimum Amount"), the Special
Account Bank shall transfer such Collections to the Concentration Account on the
next succeeding banking day on which Collections in such Special Account first
exceed the Minimum Amount. With respect to any
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Special Account that is located at or maintained by a Bank Investor hereunder,
the Transferor shall, by not later than the date that occurs six months after
the Closing Date, cause the applicable Originating Entity to close such Special
Account and shall instruct, and shall cause each applicable Originating Entity
to instruct, all Obligors theretofore remitting payments to such Special Account
to remit all future payments on Receivables and Related Security to a Special
Account located at and maintained by a financial institution that is not a Bank
Investor.
(i) Collections Received. The Transferor shall, and
shall cause each Originating Entity to, segregate and hold in trust, and
deposit, immediately, but in any event not later than the day that occurs
forty-eight (48) hours thereafter (or, if such day is not a Business Day, the
next Business Day) after its receipt thereof, to the Concentration Account all
Collections received from time to time by the Transferor or such Originating
Entity, as the case may be.
(j) Sale Treatment. The Transferor will not (i) and
will not permit any Originating Entity to, account for (including for accounting
and tax purposes), or otherwise treat, the transactions contemplated by the
Receivables Purchase Agreement, the Transferring Affiliate Letter or the BMA
Transfer Agreement in any manner other than as a sale of Receivables by the
applicable Originating Entity to the Seller or Transferor, as applicable, or
(ii) account for (other than for tax purposes) or otherwise treat and
transactions contemplated hereby in any manner other than as a sale of
Receivables by the Transferor to the Agent on behalf of the applicable
Investors. In addition, the Transferor shall, and shall cause each Originating
Entity to, disclose (in a footnote or otherwise) in all of its respective
financial statements (including any such financial statements consolidated with
any other Persons' financial statements) the existence and nature of the
transaction contemplated hereby, by the Receivables Purchase Agreement, by the
Transferring Affiliate Letter and by the BMA Transfer Agreement, and the
interest of the Transferor (in the case of the Seller's financial statements),
and the Agent, on behalf of the Investors, in the Affected Assets.
(k) Separate Business. The Transferor shall at all
times (a) to the extent the Transferor's office is located in the offices of any
Parent Group Member, pay fair market rent for its executive office space located
in the offices of such Parent Group Member, (b) have at all times at least one
member of its board of directors which is not and has never been an employee,
officer or director of any Parent Group Member or of any major creditor of any
Parent Group Member and is a person who is and has experience with asset
securitization, (c) maintain the Transferor's books, financial statements,
accounting records and other corporate documents and records separate from those
of any Parent Group Member or any other entity, (d) not commingle the
Transferor's assets with those of any Parent Group Member or any other entity,
(e) act solely in its corporate name and through its own authorized officers and
agents, (f) make investments directly or by brokers engaged and paid by the
Transferor its agents (provided that if any such agent is an Affiliate of the
Transferor it shall be compensated at a fair market rate for its services), (g)
separately manage the Transferor's liabilities from those of the Parent Group
and pay its own liabilities, including all administrative expenses, from its own
separate assets, except that the Seller may pay the organizational expenses of
the Transferor, and (h) pay from the Transferor's assets all obligations and
indebtedness of any kind incurred by the Transferor. The Transferor shall abide
by all corporate formalities, including the maintenance of
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current minute books, and the Transferor shall cause its financial statements to
be prepared in accordance with generally accepted accounting principles in a
manner that indicates the separate existence of the Transferor and its assets
and liabilities. The Transferor shall (i) pay all its liabilities, (ii) not
assume the liabilities of any Parent Group Member, (iii) not lend funds or
extend credit to any Parent Group Member except pursuant to the Receivables
Purchase Agreement in connection with the purchase of Receivables thereunder and
(iv) not guarantee the liabilities of any Parent Group Member. The officers and
directors of the Transferor (as appropriate) shall make decisions with respect
to the business and daily operations of the Transferor independent of and not
indicated by any controlling entity. The Transferor shall not engage in any
business not permitted by its Certificate of Incorporation as in effect on the
Closing Date. The Transferor shall, in addition to the foregoing, take such
other actions as are necessary on its part to ensure that the facts and
assumptions set forth in the opinions issued by Arent Fox Kintner Plotkin &
Kahn, as counsel for the Transferor, in connection with the closing or initial
Transfer under this Agreement and relating to "non-consolidation" issues and
"true sale" issues, and in the certificates accompanying such opinions, remain
true and correct in all material respects at all times.
(l) Corporate Documents. The Transferor shall only
amend, alter, change or repeal any provision of the Third, Fifth, Seventh,
Tenth, Eleventh or Twelfth Article of its Certificate of Incorporation with the
prior written consent of each Administrative Agent.
(m) Payment to the Originating Entities. With respect
to any Receivable purchased by the Transferor from the Seller, such sale shall
be effected under, and in strict compliance with the terms of, the Receivables
Purchase Agreement, including, without limitation, the terms relating to the
amount and timing of payments to be made to the Seller by the Transferor in
respect of the purchase price for such Receivable. With respect to any
Receivable purchased by the Seller from any Transferring Affiliate, the
Transferor shall cause such sale to be effected under, and in strict compliance
with the terms of, the Transferring Affiliate Letter and the BMA Transfer
Agreement, as applicable, including, without limitation, the terms relating to
the amount and timing of payments to be made to each Transferring Affiliate in
respect of the purchase price for such Receivable.
(n) Performance and Enforcement of the Receivables
Purchase Agreement, etc. The Transferor shall timely perform the obligations
required to be performed by the Transferor, and shall vigorously enforce the
rights and remedies accorded to the Transferor, under the Receivables Purchase
Agreement. The Transferor shall cause the Seller to timely perform the
obligations required to be performed by the Seller, and shall cause the Seller
to vigorously enforce the rights and remedies accorded to the Seller, under each
of the Transferring Affiliate Letter and the BMA Transfer Agreement. The
Transferor shall take all actions to perfect and enforce its rights and
interests (and the rights and interests of the Agent, each Administrative Agent
and each of the Investors, as assignees of the Transferor) under the Receivables
Purchase Agreement as any Administrative Agent may from time to time reasonably
request, including, without limitation, making claims to which it may be
entitled under any indemnity, reimbursement or similar provision contained in
the Receivables Purchase Agreement. The Transferor shall cause the Seller to
take all actions to perfect and enforce the Seller's rights and interests (and
the rights and interests of the Transferor, the Agent, the
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Administrative Agent and each of the Investors, as assignees of the Seller)
under the Transferring Affiliate Letter or the BMA Transfer Agreement as any
Administrative Agent may from time to time reasonably request, including,
without limitation, making claims to which it may be entitled under any
indemnity, reimbursement or similar provision contained in the Transferring
Affiliate Letter or the BMA Transfer Agreement.
(o) Year 2000 Compliance: Reporting. The Transferor will
promptly notify each Administrative Agent in the event the Transferor discovers
or determines that any computer application (including those of its suppliers,
vendors and customers) (i) that is necessary for the origination, collection,
management, or servicing of the Receivables will not be Year 2000 Compliant on
or before April 1, 1999 and thereafter, or (ii) that is otherwise material to
its or any of its Subsidiaries' business and operations will not be Year 2000
Compliant on a timely basis, except to the extent that, in the case of (ii)
above, such failure could not reasonably be expected (a) to have a Material
Adverse Effect on the Transferor or on the transaction documented under this
Agreement, or (b) to result in a Termination Event.
Further, the Transferor will deliver to each Administrative
Agent simultaneously with any quarterly or annual financial statements or
reports to be delivered under the Agreement, a certificate signed by an officer
of the Transferor that no material event, problems or conditions have occurred
which in the opinion of management would (i) prevent or materially delay the
Transferor's plan to become Year 2000 Compliant or (ii) cause or be likely to
cause the Transferor's representations and warranties or covenants with respect
to being or becoming Year 2000 Compliant to no longer be true.
(p) Year 2000 Compliance: Implementation: The Transferor will
cause (i) all computer applications (including those of its suppliers, vendors
and customers) that are material to its or any of its Subsidiaries' business and
operations to be Year 2000 Compliant on a timely basis, except to the extent
that a failure to do so could not reasonably be expected (a) to have a Material
Adverse Effect on the Transferor or on the transaction documented under this
Agreement, or (b) to result in a Termination Event; and (ii) all Receivable
Systems to be Year 2000 Compliant at all times on and after April 1, 1999. The
Transferor will deliver a certificate to each Administrative Agent, signed by
the chief information officer of the Transferor, certifying compliance with the
foregoing covenant by no later than April 1, 1999.
SECTION 5.2. Negative Covenants of the Transferor. At all
times from the date hereof to the later to occur of (i) the Termination Date or
(ii) the date on which the Net Investment has been reduced to zero, all accrued
Discount and Servicing Fees shall have been paid in full and all other Aggregate
Unpaids shall have been paid in full, in cash, unless each Administrative Agent
shall otherwise consent in writing:
(a) No Sales, Liens, Etc. Except as otherwise
provided herein and in the Receivables Purchase Agreement, the Transferor will
not, and will not permit any Originating Entity to, sell, assign (by operation
of law or otherwise) or otherwise dispose of, or create or suffer to exist any
Adverse Claim upon (or the filing of any financing statement) or with respect to
(x) any of the Affected Assets, (y) any inventory or goods, the sale of which
may give rise to a Receivable or any Receivable or related Contract, or (z) any
Special Account or the
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Concentration Account or any other account to which any Collections of any
Receivable are sent, or assign any right to receive income in respect thereof.
(b) No Extension or Amendment of Receivables. Except
as otherwise permitted in Section 6.2 hereof, the Transferor will not, and will
not permit any Originating Entity to, extend, amend or otherwise modify the
terms of any Receivable, or amend, modify or waive any term or condition of any
Contract related thereto.
(c) No Change in Business or Credit and Collection
Policy. The Transferor will not, and will not permit any Originating Entity to,
make any change in the character of its business or in the Credit and Collection
Policy, which change would, in either case, impair the collectibility of any
Receivable or otherwise have a Material Adverse Effect.
(d) No Mergers, Etc. The Transferor will not, and
will not permit any Originating Entity to, merge with or into or consolidate
with or into, or convey, transfer, lease or otherwise dispose of (whether in one
transaction or in a series of transactions), all or substantially all of its
assets (whether now owned or hereafter acquired and except as contemplated in
the Transaction Documents) to any Person, except that (i) any Transferring
Affiliate may merge or consolidate with any other Transferring Affiliate if, but
only if, each Administrative Agent shall receive at least ten Business Days'
prior written notice of such merger or consolidation and (ii) the Seller may
merge or consolidate with any other Person if, but only if, (x) immediately
after giving effect to such merger or consolidation, no Termination Event or
Potential Termination Event would exist and (y) each Administrative Agent shall
have received a written agreement, in form and substance satisfactory to such
Administrative Agent, executed by the corporation resulting from such merger or
consolidation, under which agreement such corporation shall become the Seller
and Collection Agent, and shall assume the duties, obligations and liabilities
of the Seller, under the Receivables Purchase Agreement, this Agreement (in its
capacity as Collection Agent hereunder), the Special Account Letters and each
other Transaction Document to which the Seller is party (whether in its
individual capacity or as Collection Agent), together with the documents
relating to the Seller of the kind delivered by or on behalf of the Seller
pursuant to Section 3.1.
(e) Change in Payment Instructions to Obligors,
Special Account Banks, Designated Account Agents and Concentration Account. The
Transferor will not, and will not permit any Originating Entity to:
(i) add or terminate any bank as a Special Account Bank from
those listed in Exhibit C hereto, or make any change in its
instructions to Obligors regarding payments to be made to any Special
Account Bank; provided that the Transferor may permit the (A) addition
of any bank as a Special Account Bank for purposes of this Agreement at
any time following delivery to each Administrative Agent of written
notice of such addition and a Special Account Letter duly executed by
such bank, and (B) termination of any Special Account Bank at any time
following delivery to each Administrative Agent of written notice of
such termination and evidence satisfactory to each Administrative Agent
that the affected Obligors shall have been instructed to remit all
subsequent Collections to another Special Account; or
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(ii) add, terminate or change the Concentration Account, or
any bank as the Concentration Account Bank, from that listed in Exhibit
C hereto, or make any change in the instructions contained in any
Special Account Letter or any change in the instructions to the
Concentration Account Bank; provided, however, that the Transferor may
terminate the then existing Concentration Account Bank and appoint a
new Concentration Account Bank if, prior to such termination and
appointment, each Administrative Agent shall receive (i) ten Business
Days' prior notice of such termination and appointment and (ii) prior
to the effective date of such termination and appointment, (x) executed
copies of Special Account Letters (in each case, executed by the
applicable Originating Entity and the applicable Special Account Bank)
instructing the Special Account Banks to transfer to the new
Concentration Account prior to the close of business on each banking
day all Collections on deposit during such banking day in the Special
Accounts at the Special Account Banks, and (y) a copy of a
Concentration Account Agreement executed by the new Concentration
Account Bank and the Transferor; or
(iii) add or terminate any Person as a Designated Account
Agent from those listed in Exhibit C hereto, or make any change in its
instructions to such Designated Account Agent regarding the handling of
the Collections in the applicable Special Account; provided that the
Transferor may permit the (A) addition of any Person that satisfies the
requirements set forth herein of a "Designated Account Agent" as a
Designated Account Agent for purposes of this Agreement at any time
following delivery to each Administrative Agent of written notice of
such addition and an Account Agent Agreement duly executed by such
Person, and (B) termination of any Designated Account Agent at any time
following delivery to each Administrative Agent of written notice of
such termination and evidence satisfactory to each Administrative Agent
that either an Originating Entity or a new Designated Account Agent
shall have been added in accordance with the terms of this Agreement to
succeed such terminated Designated Account Agent in respect of the
applicable Special Account or the affected Obligors shall have been
instructed to remit all subsequent Collections to another Special
Account.
(f) Deposits to Special Accounts and the
Concentration Account. The Transferor will not, and will not permit any of the
Originating Entities or Designated Account Agents to, deposit or otherwise
credit, or cause or permit to be so deposited or credited, to any Special
Account or the Concentration Account cash or cash proceeds other than
Collections of Receivables.
(g) Change of Name, Etc. The Transferor will not, and
will not permit any Originating Entity to, change its name, identity or
structure or the location of its chief executive office, unless at least 10 days
prior to the effective date of any such change the Transferor delivers to each
Administrative Agent (i) such documents, instruments or agreements, executed by
the Transferor and/or the affected Originating Entities, as are necessary to
reflect such change and to continue the perfection of the Agent's ownership
interests or security interest in the Affected Assets and (ii) new or revised
Special Account Letters executed by the Special Account Banks which reflect such
change and enable the Agent to continue to exercise its rights contained in
Section 2.8 hereof.
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(h) Amendment to Receivables Purchase Agreement,
Etc. The Transferor will not, and will not permit any Originating Entity to,
(i) amend, modify, or supplement the Receivables Purchase Agreement, the
Transferring Affiliate Letter, the BMA Transfer Agreement or any instrument,
document or agreement executed in connection therewith (collectively the
"Initial Transfer Documents"), (ii) terminate or cancel any Initial Transfer
Document, (iii) issue any consent or directive under any Initial Transfer
Document, (iv) undertake any enforcement proceeding in respect of any of the
Initial Transfer Documents, or (v) waive, extend the time for performance or
grant any indulgence in respect of any provision of any Initial Transfer
Document, in each case except with the prior written consent of the Agent and
each Administrative Agent; nor shall the Transferor take, or permit any
Originating Entity to take, any other action under any of the Initial Transfer
Documents that shall have a material adverse affect on the Agent, any
Administrative Agent or any Investor or which is inconsistent with the terms of
this Agreement.
(i) Other Debt. Except as provided for herein, the
Transferor will not create, incur, assume or suffer to exist any indebtedness
whether current or funded, or any other liability other than (i) indebtedness of
the Transferor representing fees, expenses and indemnities arising hereunder or
under the Receivables Purchase Agreement for the purchase price of the
Receivables under the Receivables Purchase Agreement, and (ii) other
indebtedness incurred in the ordinary course of its business in an amount not to
exceed $50,000 at any time outstanding.
(j) ERISA Matters. The Transferor will not, and will
not permit any Originating Entity to, (i) engage or permit any of its respective
ERISA Affiliates to engage in any prohibited transaction (as defined in Section
4975 of the Code and Section 406 of ERISA) for which an exemption is not
available or has not previously been obtained from the U.S. Department of Labor;
(ii) permit to exist any accumulated funding deficiency (as defined in Section
302(a) of ERISA and Section 412(a) of the Code) or funding deficiency with
respect to any Benefit Plan other than a Multiemployer Plan; (iii) fail to make
any payments to any Multiemployer Plan that the Transferor, such Originating
Entity or any ERISA Affiliate thereof is required to make under the agreement
relating to such Multiemployer Plan or any law pertaining thereto; (iv)
terminate any Benefit Plan so as to result in any liability; or (v) permit to
exist any occurrence of any reportable event described in Title IV of ERISA
which represents a material risk of a liability to the Transferor, such
Originating Entity or any ERISA Affiliate thereof under ERISA or the Code, if
such prohibited transactions, accumulated funding deficiencies, payments,
terminations and reportable events occurring within any fiscal year of the
Transferor, in the aggregate, involve a payment of money or an incurrence of
liability by the Transferor, any Originating Entity or any ERISA Affiliate
thereof, in an amount in excess of $500,000.
SECTION 5.3. Affirmative Covenants of the Collection Agent. At
all times from the date hereof to the later to occur of (i) the Termination Date
or (ii) the date on which the Net Investment has been reduced to zero, all
accrued Discount and Servicing Fees shall have been paid in full and all other
Aggregate Unpaids shall have been paid in full, in cash, unless each
Administrative Agent shall otherwise consent in writing.
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(a) Conduct of Business. The Collection Agent will
carry on and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently conducted and do
all things necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation in its jurisdiction of incorporation and
maintain all requisite authority to conduct its business in each jurisdiction in
which its business is conducted.
(b) Compliance with Laws. The Collection Agent will
comply with all laws, rules and regulations (including, without limitation, all
CHAMPUS/VA Regulations, Medicaid Regulations and Medicare Regulations), and all
orders, writs, judgments, injunctions, decrees or awards to which it or its
respective properties may be subject.
(c) Furnishing of Information and Inspection of
Records. The Collection Agent will furnish to each Administrative Agent from
time to time such information with respect to the Receivables as such
Administrative Agent may reasonably request, including, without limitation,
listings identifying the Obligor and the Outstanding Balance for each
Receivable. The Collection Agent will, at any time and from time to time during
regular business hours permit any Administrative Agent, or its agents or
representatives, (i) to examine and make copies of and take abstracts from all
Records and (ii) to visit the offices and properties of the Collection Agent for
the purpose of examining such records, and to discuss matters relating to
Receivables or the Transferor's, the Originating Entities' or the Collection
Agent's performance hereunder and under the other Transaction Documents to which
such Person is a party with any of the officers, directors, employees or
independent public accountants of the Collection Agent having knowledge of such
matters.
(d) Keeping of Records and Books of Account. The
Collection Agent will maintain and implement administrative and operating
procedures (including, without limitation, an ability to recreate records
evidencing Receivables in the event of the destruction of the originals
thereof), and keep and maintain, all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit the daily
identification of each new Receivable and all Collections of and adjustments to
each existing Receivable). The Collection Agent will give each Administrative
Agent notice of any material change in the administrative and operating
procedures of the Collection Agent referred to in the previous sentence.
(e) Notice of Agent's Interest. The Collection Agent
shall cause its master data processing records, computer tapes, files and other
documents or instruments provided to, developed by or otherwise maintained by
the Collection Agent in connection with any Transfer or otherwise for purposes
of the transactions contemplated in this Agreement to disclose conspicuously the
Transferor's ownership of the Receivables and the Agent's interest therein.
(f) Credit and Collection Policies. The Collection
Agent will comply in all material respects with the Credit and Collection Policy
in regard to each Receivable and the related Contract.
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(g) Collections. The Collection Agent shall instruct
all Obligors to cause all Collections to be deposited directly to a Special
Account and shall take, or omit to take, all actions in respect of Obligors, the
Special Account Banks and the Concentration Account Bank solely in a manner that
is consistent with the terms of this Agreement, including, without limitation,
Sections 2.8, 5.1(h), 5.2(e) and 5.2(f) hereof.
(h) Collections Received. The Collection Agent shall
segregate and hold in trust, and deposit, immediately, but in any event not
later than the day that occurs forty-eight (48) hours thereafter (or, if such
day is not a Business Day, the next Business Day) after its receipt thereof, to
the Concentration Account all Collections received from time to time by the
Collection Agent.
(i) Year 2000 Compliance: Reporting. The Collection
Agent will promptly notify each Administrative Agent in the event the Collection
Agent discovers or determines that any computer application (including those of
its suppliers, vendors and customers) (i) that is necessary for the origination,
collection, management, or servicing of the Receivables by the Collection Agent,
the Seller or any Transferring Affiliate will not be Year 2000 Compliant on or
before January 1, 1999 and thereafter, or (ii) that is otherwise material to its
or the Seller's or any Transferring Affiliate's business and operations will not
be Year 2000 Compliant on a timely basis, except to the extent that, in the case
of (ii) above, such failure could not reasonably be expected (a) to have a
Material Adverse Effect on the Collection Agent, the Seller or any Transferring
Affiliate or on the transactions contemplated under the Transaction Documents,
or (b) to result in a Termination Event.
Further, the Collection Agent will deliver to each
Administrative Agent simultaneously with any quarterly or annual financial
statements or reports to be delivered under the Agreement, a certificate signed
by an officer of the Collection Agent that no material event, problems or
conditions have occurred which in the opinion of management would (i) prevent or
materially delay the Collection Agent's plan to become, and to cause the Seller
and each Transferring Affiliate to become, Year 2000 Compliant or (ii) cause or
be likely to cause the Collection Agent's representations and warranties or
covenants with respect to the Collection Agent, the Seller and each Transferring
Affiliate being or becoming Year 2000 Compliant to no longer be true.
(j) Year 2000 Compliance: Implementation: The
Collection Agent will cause (i) all computer applications (including those of
its suppliers, vendors and customers) that are material to its or any of its
Subsidiaries' business and operations to be Year 2000 Compliant on a timely
basis, except to the extent that a failure to do so could not reasonably be
expected (a) to have a Material Adverse Effect on the Collection Agent or on the
transaction documented under this Agreement, or (b) to result in a Termination
Event; and (ii) all Receivable Systems to be Year 2000 Compliant at all times on
and after April 1, 1999. The Collection Agent will deliver a certificate to each
Administrative Agent, signed by the chief information officer of the Collection
Agent, certifying compliance with the foregoing covenant by no later than April
1, 1999.
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SECTION 5.4. Negative Covenants of the Collection Agent. At
all times from the date hereof to the later to occur of (i) the Termination Date
or (ii) the date on which the Net Investment has been reduced to zero, all
accrued Discount and Servicing Fees shall have been paid in full and all other
Aggregate Unpaids shall have been paid in full, in cash, unless each
Administrative Agent shall otherwise consent in writing:
(a) No Extension or Amendment of Receivables. Except
as otherwise permitted in Section 6.2 hereof, the Collection Agent will not
extend, amend or otherwise modify the terms of any Receivable, or amend, modify
or waive any term or condition of any Contract related thereto.
(b) No Change in Business or Credit and Collection
Policy. The Collection Agent will not make any change in the character of its
business or in the Credit and Collection Policy, which change would, in either
case, impair the collectibility of any Receivable or otherwise have a Material
Adverse Effect.
(c) No Mergers, Etc. Except as otherwise permitted
under Section 5.2(d), the Collection Agent will not (i) consolidate or merge
with or into any other Person, or (ii) sell, lease or transfer all or
substantially all of its assets to any other Person.
(d) Deposits to Accounts. The Collection Agent will
not deposit or otherwise credit, or cause or permit to be so deposited or
credited, to any Special Account or Concentration Account cash or cash proceeds
other than Collections of Receivables.
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ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.1. Appointment of Collection Agent. The servicing, administering
and collection of the Receivables shall be conducted by such Person (the
"Collection Agent") so designated from time to time in accordance with this
Section 6.1. Until the Agent gives notice to the Transferor of the designation
of a new Collection Agent, NMC is hereby designated as, and hereby agrees to
perform the duties and obligations of, the Collection Agent pursuant to the
terms hereof. The Collection Agent may not delegate any of its rights, duties or
obligations hereunder, or designate a substitute Collection Agent, without the
prior written consent of each Administrative Agent; provided that the Collection
Agent may from time to time delegate to any Originating Entity such of its
rights, duties and obligations hereunder as relate to the servicing,
administering and collection of the Receivables originated by such Originating
Entity; provided further that (i) any such delegation shall be terminated upon
the replacement of the Collection Agent hereunder and (ii) the Collection Agent
shall continue to remain solely liable for the performance of the duties as
Collection Agent hereunder notwithstanding any such delegation hereunder. The
Agent may, and upon the direction of the Majority Investors the Agent shall,
after the occurrence of a Collection Agent Default or any other Termination
Event designate as Collection Agent any Person (including itself) to succeed NMC
or any successor Collection Agent, on the conditions in each case that any such
Person so designated shall agree to perform the duties and obligations of the
Collection Agent pursuant to the terms hereof and such designation of such
Person is permitted by applicable law (including, without limitation, applicable
CHAMPUS/VA Regulations, Medicaid Regulations and Medicare Regulations) or any
order of a court of competent jurisdiction. The Agent may notify any Obligor as
to the ownership interest therein that shall have been transferred to the
Transferor and, except as otherwise provided hereunder, as to the Transferred
Interest hereunder.
SECTION 6.2. Duties of Collection Agent.
(a) The Collection Agent shall take or cause to be taken all such
action as may be necessary or advisable to collect each Receivable from time to
time, all in accordance with applicable laws, rules and regulations (including,
without limitation, all CHAMPUS/VA Regulations, Medicaid Regulations and
Medicare Regulations), with reasonable care and diligence, and in accordance
with the Credit and Collection Policy. Each of the Transferor, the Agent, the
Administrative Agents and the Investors hereby appoints as its agent the
Collection Agent, from time to time designated pursuant to Section 6.1 hereof,
to enforce its respective rights and interests in and under the Affected Assets.
To the extent permitted by applicable law, the Transferor hereby grants to any
Collection Agent appointed hereunder an irrevocable power of attorney to take
any and all steps in the Transferor's and/or any Originating Entity's name and
on behalf of the Transferor necessary or desirable, in the reasonable
determination of the Collection Agent, to collect all amounts due under any and
all Receivables, including, without limitation, endorsing the Transferor's
and/or any Originating Entity's name on checks and other instruments
representing Collections and enforcing such Receivables and the related
Contracts. The Transferor represents and warrants that the foregoing power of
attorney, in the case of any Originating Entity, has been duly granted to the
Transferor under the Receivables Purchase
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Agreement and the Transferor is authorized under the Receivables Purchase
Agreement, to the extent permitted by applicable law, to authorize the
Collection Agent hereunder to exercise such power. The Collection Agent shall
set aside for the account of the Transferor and the Agent (for the benefit of
the Investors) their respective allocable shares of the Collections of
Receivables in accordance with Sections 2.5 and 2.6 hereof. The Collection Agent
shall segregate and deposit to each Administrative Agent's account such
Administrative Agent's allocable share of Collections of Receivables when
required pursuant to Article II hereof. So long as no Termination Event shall
have occurred and be continuing, the Collection Agent may, in accordance with
the Credit and Collection Policy, extend the maturity or adjust the Outstanding
Balance of any Defaulted Receivable as the Collection Agent may determine to be
appropriate to maximize Collections thereof; provided, however, that such
extension or adjustment shall not alter the status of such Receivable as a
Defaulted Receivable. The Transferor shall deliver to the Collection Agent and
the Collection Agent shall hold in trust for the Transferor, and the Agent, on
behalf of the Investors, in accordance with their respective interests, all
Records which evidence or relate to Receivables or Related Security.
Notwithstanding anything to the contrary contained herein, the Agent shall have
the absolute and unlimited right to direct the Collection Agent (whether the
Collection Agent is NMC or any other Person) to commence or settle any legal
action to enforce collection of any Receivable or to foreclose upon or repossess
any Related Security. The Collection Agent shall not make the Agent, any
Administrative Agent or any of the Investors a party to any litigation without
the prior written consent of such Person.
(b) The Collection Agent shall, as soon as practicable following
receipt thereof, turn over to the Transferor any collections of any indebtedness
of any Person which is not on account of a Receivable. If the Collection Agent
is not NMC or an Affiliate thereof, the Collection Agent, by giving three
Business Days' prior written notice to the Agent, may revise the percentage used
to calculate the Servicing Fee so long as the revised percentage will not result
in a Servicing Fee that exceeds 110% of the reasonable and appropriate out-of
pocket costs and expenses of such Collection Agent incurred in connection with
the performance of its obligations hereunder as documented to the reasonable
satisfaction of each Administrative Agent, provided, however, that at any time
after the Percentage Factor equals or exceeds 98%, any compensation to the
Collection Agent in excess of the Servicing Fee initially provided for herein
shall be an obligation of the Transferor and shall not be payable, in whole or
in part, from the Collections allocated to or for the benefit of any of the
Investors hereunder. The Collection Agent, if other than NMC, shall as soon as
practicable upon demand, deliver to the Transferor all Records in its possession
which evidence or relate to indebtedness of an Obligor which is not a
Receivable.
(c) On or before 90 days after the end of each fiscal year of the
Collection Agent, beginning with the fiscal year ending December 31, 1997, the
Collection Agent shall cause a firm of independent public accountants (who may
also render other services to the Collection Agent, the Transferor, the Seller
or any Affiliates of any of the foregoing), the Business Credit Field Exam Group
of Bank of America, N.A. or such other Person as may be approved by each
Administrative Agent, to furnish a report to each Administrative Agent to the
effect that they have (any of the foregoing being an "Auditor"): (i) compared
the information contained in the Investor Reports delivered during such fiscal
year then ended with the information contained in the Contracts and the
Collection Agent's records and computer systems
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for such period, and that, on the basis of such examination and comparison, such
Auditor is of the opinion that the information contained in the Investor Reports
reconciles with the information contained in the Contracts and the Collection
Agent's records and computer system and that the servicing of the Receivables
has been conducted in compliance with this Agreement, (ii) confirmed the Net
Receivables Balance as of the end of each Tranche Period during such fiscal
year, and (iii) verified that the Receivables treated by the Collection Agent as
Eligible Receivables in fact satisfied the requirements of the definition
thereof contained herein except, in each case, for (a) such exceptions as such
Auditor shall believe to be immaterial (which exceptions need not be enumerated)
and (b) such other exceptions as shall be set forth in such statement.
(d) Notwithstanding anything to the contrary contained in this Article
VI, the Collection Agent, if not the Transferor or NMC, shall have no obligation
to collect, enforce or take any other action described in this Article VI with
respect to any indebtedness that is not included in the Transferred Interest
other than to deliver to the Transferor the collections and documents with
respect to any such indebtedness as described in Section 6.2 (b) hereof.
SECTION 6.3. Right After Designation of New Collection Agent. At any time
following the designation of a Collection Agent (other than the Transferor, the
Seller or any Affiliate of the Transferor or the Seller) pursuant to Section 6.1
hereof:
(i) The Agent may direct that payment of all amounts payable under any
Receivable be made directly to the Agent or its designee.
(ii) The Transferor shall, at the Agent's request and at the
Transferor's expense, give notice of the Agent's, the Transferor's and/or the
Bank Investors' ownership of Receivables to each Obligor and direct that
payments be made directly to the Agent or its designee.
(iii) The Transferor shall, at the Agent's request, (A) assemble all of
the Records, and shall make the same available to the Agent or its designee at a
place selected by the Agent or its designee, and (B) segregate all cash, checks
and other instruments received by it from time to time constituting Collections
of Receivables in a manner acceptable to the Agent and shall, promptly upon
receipt, remit all such cash, checks and instruments, duly endorsed or with duly
executed instruments of transfer, to the Agent or its designee.
(iv) The Transferor hereby authorizes the Agent to take, to the extent
permitted by applicable law, any and all steps in the Transferor's or any
Originating Entity's name (which power, in the case of each Originating Entity,
the Transferor is authorized to grant pursuant to authority granted to the
Transferor under the Receivables Purchase Agreement) and on behalf of the
Transferor and such Originating Entity necessary or desirable, in the
determination of the Agent, to collect all amounts due under any and all
Receivables, including, without limitation, endorsing the Transferor's or such
Originating Entity's name on checks and other instruments representing
Collections and enforcing such Receivables and the related Contracts.
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Notwithstanding the foregoing clauses (i), (ii), (iii) and (iv), the Agent shall
not at any time direct, or cause the Transferor or any Originating Entity to
direct, Obligors of Receivables or Related Security payable under the Medicare
or Medicaid program to make payment of amounts due or to become due to the
Transferor or any Originating Entity in respect of such Receivables or Related
Security directly to the Concentration Account or to the Agent or its designee,
except for any such payment in respect of such Receivables or Related Security
or any assignment thereof that is established by, or made pursuant to, the order
of a court of competent jurisdiction.
SECTION 6.4. Collection Agent Default. The occurrence of any one or more of
the following events shall constitute a Collection Agent Default:
(a) (i) the Collection Agent or, to the extent that the Transferor, the
Seller or any Affiliate of the Transferor or the Seller is then acting as
Collection Agent, the Transferor, the Seller or such Affiliate, as applicable,
shall fail to observe or perform any term, covenant or agreement to be observed
or performed (A) under Section 5.3(d), 5.3(g) or 5.3(h) or Section 5.4, or (B)
under Section 5.3 (other than subsection (d), (g) or (h) thereof) and such
failure shall continue for five (5) days, or (ii) the Collection Agent or, to
the extent that the Transferor, the Seller or any Affiliate of the Transferor,
or the Seller is then acting as Collection Agent, the Transferor, the Seller or
such Affiliate, as applicable, shall fail to observe or perform any term,
covenant or agreement hereunder (other than as referred to in clause (i) or
(iii) of this Section 6.4(a)) or under any of the other Transaction Documents to
which such Person is a party or by which such Person is bound, and such failure
shall remain unremedied for ten (10) days, or (iii) the Collection Agent or, the
extent that the Transferor, the Seller or any Affiliate of the Transferor, or
the Seller is then acting as Collection Agent, the Transferor, the Seller or
such Affiliate, as applicable, shall fail to make any payment or deposit
required to be made by it hereunder when due or the Collection Agent shall fail
to observe or perform any term, covenant or agreement on the Collection Agent's
part to be performed under Section 2.8(b) hereof; or
(b) any representation, warranty, certification or statement made by
the Collection Agent or the Transferor, the Seller or any Affiliate of the
Transferor or the Seller (in the event that the Transferor, the Seller or such
Affiliate is then acting as the Collection Agent) in this Agreement, the
Receivables Purchase Agreement, the Transferring Affiliate Letter, the BMA
Transfer Agreement or in any of the other Transaction Documents or in any
certificate or report delivered by it pursuant to any of the foregoing shall
prove to have been incorrect in any material respect when made or deemed made;
or
(c) failure of the Collection Agent or any of its Subsidiaries, FMC, or
FMCH to pay when due any amounts due under any agreement under which any
Indebtedness greater that $5,000,000 is governed; or the default by the
Collection Agent or any of its Subsidiaries, FMC or FMCH in the performance of
any term, provision of condition contained in any agreement under which any
Indebtedness greater than $5,000,000 was created or is governed, regardless of
whether such event is an "event of default" or "default" under any such
agreement; or any Indebtedness of the Collection Agent or any of its
Subsidiaries, FMC or FMCH greater than $5,000,000 shall be declared to be due
and payable or required to be prepaid (other than by a regularly scheduled
payment and other than in the case of an instrument stated to be payable on
demand) prior to the scheduled date of maturity thereof; or
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(d) any Event of Bankruptcy shall occur with respect to the Collection
Agent or any of its Subsidiaries; provided that in the case of any immaterial
Subsidiary of the Collection Agent, if an Event of Bankruptcy shall have
occurred by reason of any institution of an involuntary proceeding against such
Subsidiary, such Event of Bankruptcy shall not constitute a Collection Agent
Default unless such proceeding shall have remained undismissed or unstayed for a
period of 60 days; or
(e) there shall have occurred any material adverse change in the
operations of the Collection Agent since the end of the last fiscal year ending
prior to the date of its appointment as Collection Agent hereunder or any other
event shall have occurred which, in the commercially reasonably judgment of the
Agent, materially and adversely affects the Collection Agent's ability to either
collect the Receivables or to perform under this Agreement.
SECTION 6.5. Responsibilities of the Transferor. Anything herein to the
contrary notwithstanding, the Transferor shall, and/or shall cause each
Originating Entity to, (i) perform all of each Originating Entity's obligations
under the Contracts related to the Receivables to the same extent as if
interests in such Receivables had not been sold hereunder and under the
Transferring Affiliate Letter, the BMA Transfer Agreement and/or the Receivables
Purchase Agreement, as applicable, and the exercise by the Agent, any
Administrative Agent and the Investors of their rights hereunder and under the
Transferring Affiliate Letter, the BMA Transfer Agreement and the Receivables
Purchase Agreement shall not relieve the Transferor or the Seller from such
obligations and (ii) pay when due any taxes, including without limitation, any
sales taxes payable in connection with the Receivables and their creation and
satisfaction. Neither the Agent nor any of the Investors or the Administrative
Agents shall have any obligation or liability with respect to any Receivable or
related Contracts, nor shall it be obligated to perform any of the obligations
of the Seller thereunder.
ARTICLE VII
TERMINATION EVENTS
SECTION 7.1. Termination Events. The occurrence of any one or more of the
following events shall constitute a Termination Event:
(a) the Transferor or the Collection Agent shall fail to make any
payment or deposit to be made by it hereunder or under the Receivables Purchase
Agreement when due hereunder or thereunder; or
(b) any representation, warranty, certification or statement made or
deemed made by the Transferor in this Agreement, by FMC or FMCH under the Parent
Agreement, or by the Transferor, FMC, FMCH or any other Parent Group Member in
any other Transaction Document to which it is a party or in any other document
certificate or other writing delivered pursuant hereto or thereto, shall prove
to have been incorrect in any material respect when made or deemed made; or
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(c) the Transferor or the Collection Agent shall default in the
performance of any payment or undertaking (other than those covered by clause
(a) above) to be performed or observed under:
(i) Section 5.1(a)(iv); provided that, in the case of any failure to
provide any such notice relating to a Potential Termination Event that
shall have ceased to exist prior to the date such notice was required to
have been given under Section 5.1(a)(iv), the failure to give such notice
shall not constitute a Termination Event unless a senior officer of the
Seller or the Transferor (including, in each case, the Treasurer, any
Assistant Treasurer, General Counsel or any assistant or associate general
counsel of such Person) shall have known of the occurrence of such
Potential Termination Event during such period; or
(ii) any of Sections 5.1(a)(v), 5.1 (a)(x), 5.1 (a)(ix), 5.1(b)(i),
5.1(f), 5.1(g), 5.1(h), 5.1(i), 5.1(k), 5.1(l), 5.2(a), 5.2(c), 5.2(d),
5.2(e), 5.2(f), 5.2(g), 5.2(h), 5.2(i) or 6.3; or
(iii) Section 5.1(b)(ii), and such default shall continue for 2
Business Days; or
(iv) any other provision hereof and such default in the case of this
clause (iv) shall continue for ten (10) days;
(d) (i) failure of the Transferor to pay when due any amounts due under
any agreement relating to Indebtedness to which it is a party; or the default by
the Transferor in the performance of any term, provision or condition contained
in any agreement relating to Indebtedness to which it is a party regardless of
whether such event is an "event of default" or "default" under any such
agreement; or any Indebtedness owing by the Transferor shall be declared to be
due and payable or required to be prepaid (other than by a regularly scheduled
payment) prior to the date of maturity thereof; or (ii) failure of the Seller,
FMCH, FMC or any Transferring Affiliate to pay when due any amounts due under
any agreement to which any such Person is a party and under which any
Indebtedness greater than $5,000,000 is governed; or the default by the Seller,
FMCH, FMC or any Transferring Affiliate in the performance of any term,
provision or condition contained in any agreement to which any such Person is a
party and under which any Indebtedness owing by the Seller, FMCH, FMC or any
Transferring Affiliate greater than $5,000,000 was created or is governed,
regardless of whether such event is an "event of default" or "default" under any
such agreement; or any Indebtedness owing by the Seller, FMCH, FMC or any
Transferring Affiliate greater than $5,000,000 shall be declared to be due and
payable or required to be prepaid (other than by a regularly scheduled payment
and other than in the case of an instrument stated to be payable on demand)
prior to the date of maturity thereof; or
(e) any Event of Bankruptcy shall occur with respect to the Transferor,
any Originating Entity, FMC, FMCH or NMC; provided that, in the case of any
Event of Bankruptcy relating to any Transferring Affiliate, such Event of
Bankruptcy shall not constitute a Termination Event hereunder if at such time
the Percentage Factor does not exceed the
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Maximum Percentage Factor after reducing the Net Receivables Balance by an
amount equal to the aggregate Outstanding Balance of all Receivables otherwise
included in the calculation of Net Receivables Balance which either (i) have
been originated by such Transferring Affiliate or (ii) are owing from any
Obligor that shall have been directed to remit payments thereon to a Special
Account that is a Special Account to which Obligors in respect of the
Transferring Affiliate that is the subject of such Event of Bankruptcy shall
have been directed to remit payments; or
(f) the Agent, on behalf of the Investors, shall, for any reason, fail
or cease to have a valid and perfected first priority ownership or security
interest in the Affected Assets free and clear of any Adverse Claims; or the
Transferor shall, for any reason, fail or cease to have all right, title and
interest in and to all Receivables, Related Security and Collections, free and
clear of any Adverse Claim, subject only to the interests therein of the Agent,
on behalf of the Investors; or
(g) a Collection Agent Default shall have occurred; or
(h) the Transferring Affiliate Letter, the BMA Transfer Agreement, the
Receivables Purchase Agreement or any other Transaction Document shall have
terminated; or any material provision thereof shall cease for any reason to be
valid and binding on any party thereto or any party shall so state in writing;
or any party to any Transaction Document (other than the Agent, any
Administrative Agent or any Investor) shall fail to perform any material term,
provision or condition contained in any Transaction Document on its part to be
performed or a default shall otherwise occur thereunder; or
(i) any of FMCH, NMC, the Transferor or the Seller shall enter into any
transaction or merger whereby it is not the surviving entity; or
(j) there shall have occurred any material adverse change in the
operations of any of FMCH, NMC, the Transferor or the Seller since December 31,
1996 or any other Material Adverse Effect shall have occurred; or
(k) any Liquidity Provider or Credit Support Provider shall have given
notice that an event of default has occurred and is continuing under any of its
respective agreements with a Conduit Investor; or
(l) the Commercial Paper issued by a Conduit Investor or its Related
Issuer shall not be rated at least "A-2" by Standard & Poor's and at least "P-2"
by Moody's, unless any rating of such Commercial Paper shall be lower than such
level solely as a result of the correspondingly lower rating of the Credit
Support Provider for such Conduit Investor; or
(m) (i) the Percentage Factor exceeds the Maximum Percentage Factor
unless the Transferor reduces the Net Investment or increases the balance of the
Affected Assets on the next Business Day so as to reduce the Percentage Factor
to less than or equal to 98%; (ii) the Percentage Factor equals or exceeds 100%
at any time; (iii) the portion of the Net Investment held by the Investors in
any Related Group plus, in the case where any portion of such Net Investment is
held by a Conduit Investor, the Interest Component of all outstanding Related
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Commercial Paper with respect to such Conduit Investor, shall exceed the
applicable Related Group Limit at any time; or
(n) the Dilution Ratio for any month exceeds 12%; or
(o) the Loss-to-Liquidation Ratio for any month exceeds 8%; or
(p) the Default Ratio for any month exceeds 12%; or
(q) a default shall occur under the Parent Agreement; or the Parent
Agreement shall for any reason terminate; or any material provision thereof
shall cease to be valid and binding on any party thereto or any party thereto
shall so state in writing; or
(r) (i) the Seller shall cease to own, free and clear of any Adverse
Claim all of the outstanding shares of capital stock of the Transferor on a
fully diluted basis; or (ii) FMCH shall cease to own, directly or indirectly,
free and clear of any Adverse Claim all of the outstanding shares of capital
stock of any of the Originating Entities or the Collection Agent on a fully
diluted basis; or (iii) FMC shall cease to own, directly or indirectly, free and
clear of any Adverse Claim other than a pledge made pursuant to the Bank
Revolver, all of the Voting Stock of FMCH other than the preferred stock of FMCH
outstanding as of the date hereof (which preferred stock outstanding as of the
date hereof shall not represent more than 20% of the total Voting Stock of
FMCH); or (iv) Fresenius AG, a corporation organized under the laws of the
Federal Republic of Germany, shall cease to own, directly or indirectly, free
and clear of any Adverse Claim at least a majority of the Voting Stock of FMC;
or
(s) both (i) FMCH's long-term public senior debt securities shall be
rated lower than B+ by Standard & Poor's or B1 by Moody's, or if neither
Standard & Poor's nor Moody's shall rate such securities, FMCH's long-term
senior debt shall have a deemed rating of lower than B+ as determined by the
Agent using its standard bond rating methodology, and (ii) FMC's long-term
public senior debt securities shall be rated lower than B+ by Standard & Poor's
or B1 by Moody's, or if neither Standard & Poor's nor Moody's shall rate such
securities, FMC's long-term senior debt shall have a deemed rating of lower than
B+ as determined by the Agent using its standard bond rating methodology.
SECTION 7.2. Termination. (a) Upon the occurrence of any Termination Event,
the Agent may, and at the direction of any Administrative Agent or the Majority
Investors shall, by notice to the Transferor and the Collection Agent declare
the Termination Date to have occurred; provided, however, that in the case of
any event described in Section 7.1(e), 7.1(f), 7.1(m)(ii), 7.1(m)(iii) or 7.1(r)
above, the Termination Date shall be deemed to have occurred automatically upon
the occurrence of such event. Upon any such declaration or automatic occurrence,
the Agent shall have, in addition to all other rights and remedies under this
Agreement or otherwise, all other rights and remedies provided under the UCC of
the applicable jurisdiction and other applicable laws, all of which rights shall
be cumulative.
(b) At all times after the declaration or automatic occurrence of the
Termination Date pursuant to Section 7.2(a), the Base Rate plus 2.00% shall be
the Tranche Rate applicable to the Net Investment for all existing and future
Tranches.
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ARTICLE VIII
INDEMNIFICATION; EXPENSES; RELATED MATTERS
SECTION 8.1. Indemnities by the Transferor. Without limiting any other
rights which the Agent, the Administrative Agents or the Investors may have
hereunder or under applicable law, the Transferor hereby agrees to indemnify the
Investors, the Agent, the Administrative Agents, the Collateral Agents, the
Liquidity Providers and the Credit Support Providers and their respective
successors and permitted assigns and their respective officers, directors and
employees (collectively, "Indemnified Parties") from and against any and all
damages, losses, claims, liabilities, costs and expenses, including, without
limitation, reasonable attorneys' fees (which such attorneys may be employees of
a Liquidity Provider, a Credit Support Provider, the Agent, an Administrative
Agent or a Collateral Agent, as applicable) and disbursements (all of the
foregoing being collectively referred to as "Indemnified Amounts") awarded
against or incurred by any of them in any action or proceeding between the
Transferor or any Parent Group Member (including any Parent Group Member, in its
capacity as the Collection Agent) and any of the Indemnified Parties or between
any of the Indemnified Parties and any third party or otherwise arising out of
or as a result of this Agreement, the other Transaction Documents, the ownership
or maintenance, either directly or indirectly, by the Agent or any Investor of
the Transferred Interest or any of the other transactions contemplated hereby or
thereby, excluding, however, (i) Indemnified Amounts to the extent resulting
from gross negligence or willful misconduct on the part of an Indemnified Party
or (ii) recourse (except as otherwise specifically provided in this Agreement)
for uncollectible Receivables. Without limiting the generality of the foregoing,
the Transferor shall indemnify each Indemnified Party for Indemnified Amounts
relating to or resulting from:
(i) any representation or warranty made by any Parent Group Member
(including any Parent Group Member, in its capacity as the Collection
Agent) or any officers of any Parent Group Member (including any Parent
Group Member, in its capacity as the Collection Agent) under or in
connection with this Agreement, the Receivable Purchase Agreement, the
Parent Agreement, the Transferring Affiliate Letter, the BMA Transfer
Agreement, any of the other Transaction Documents, any Investor Report or
any other information or report delivered by any Parent Group Member
pursuant to or in connection with any Transaction Document, which shall
have been false or incorrect in any material respect when made or deemed
made;
(ii) the failure by any Parent Group Member (including any Parent
Group Member, in its capacity as the Collection Agent) to comply with any
applicable law, rule or regulation (including, without limitation, any
CHAMPUS/VA Regulation, any Medicaid Regulation or any Medicare Regulation),
including with respect to any Receivable or the related Contract, or the
nonconformity of any Receivable or the related Contract with any such
applicable law, rule or regulation;
(iii) the failure (x) to vest and maintain vested in the Agent, on
behalf of the Investors, an undivided first priority, perfected percentage
ownership interest (to the extent of the Transferred Interest) in the
Affected Assets free and clear of any Adverse
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Claim or (y) to create or maintain a valid and perfected first priority
security interest in favor of the Agent, for the benefit of the Investors,
in the Affected Assets as contemplated pursuant to Section 10.11, free and
clear of any Adverse Claim;
(iv) the failure to file, or any delay in filing, financing
statements, continuation statements, or other similar instruments or
documents under the UCC of any applicable jurisdiction or other applicable
laws with respect to any of the Affected Assets;
(v) any dispute, claim, offset or defense (other than discharge in
bankruptcy) of the Obligor to the payment of any Receivable (including,
without limitation, a defense based on such Receivable or the related
Contract not being the legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms), or any other claim
resulting from the sale of merchandise or services related to such
Receivable or the furnishing or failure to furnish such merchandise or
services;
(vi) any failure of the Collection Agent to perform its duties or
obligations in accordance with the provisions hereof; or
(vii) any products liability claim or personal injury or property
damage suit or other similar or related claim or action of whatever sort
arising out of or in connection with merchandise or services which are the
subject of any Receivable;
(viii) the transfer of an ownership interest in any Receivable other
than an Eligible Receivable;
(ix) the failure by any Parent Group Member (individually or as
Collection Agent) to comply with any term, provision or covenant contained
in this Agreement or any of the other Transaction Documents to which it is
a party or to perform any of its respective duties under the Contracts;
(x) the Percentage Factor exceeding the Maximum Percentage Factor at
any time;
(xi) the failure of any Originating Entity to pay when due any taxes,
including without limitation, sales, excise or personal property taxes
payable in connection with any of the Receivables;
(xii) any repayment by any Indemnified Party of any amount previously
distributed in reduction on Net Investment which such Indemnified Party
believes in good faith is required to be made;
(xiii) the commingling by the Transferor, any Originating Entity or
the Collection Agent of Collections of Receivables at any time with other
funds;
(xiv) any investigation, litigation or proceeding related to this
Agreement, any of the other Transaction Documents, the use of proceeds of
Transfers by the
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Transferor or any Originating Entity, the ownership of Transferred
Interests, or any Receivable, Related Security or Contract;
(xv) the failure of any Special Account Bank, Designated Account Agent
or the Concentration Account Bank to remit any amounts held by it pursuant
to the instructions set forth in the applicable Special Account Letter or
Concentration Account Agreement or any instruction of the Collection Agent,
the Transferor, any Originating Entity or the Agent (to the extent such
Person is entitled to give such instructions in accordance with the terms
hereof and of any applicable Special Account Letter or Concentration
Account Agreement) whether by reason of the exercise of set-off rights or
otherwise;
(xvi) any inability to obtain any judgment in or utilize the court or
other adjudication system of, any state in which an Obligor may be located
as a result of the failure of the Transferor or the Seller to qualify to do
business or file any notice of business activity report or any similar
report;
(xvii) any failure of the Transferor to give reasonably equivalent
value to the Seller in consideration of the purchase by the Transferor from
the Seller of any Receivable, any failure of the Seller to give reasonably
equivalent value to any Transferring Affiliate in consideration of the
purchase by the Seller from such Transferring Affiliate of any Receivable,
or any attempt by any Person to void, rescind or set-aside any such
transfer under statutory provisions or common law or equitable action,
including, without limitation, any provision of the Bankruptcy Code;
(xviii) any action taken by the Transferor, any Originating Entity or
the Collection Agent (if a Parent Group Member or designee thereof) in the
enforcement or collection of any Receivable; provided, however, that if any
Conduit Investor enters into agreements for the purchase of interests in
receivables from one or more Other Transferors, such Conduit Investor shall
allocate such Indemnified Amounts which are in connection with a Credit
Support Agreement or the credit support furnished by the Credit Support
Provider or (in the case of Enterprise) the Liquidity Provider Agreement to
which Enterprise is a party to the Transferor and each Other Transferor;
and provided, further, that if such Indemnified Amounts are attributable to
any Parent Group Member and not attributable to any Other Transferor, the
Transferor shall be solely liable for such Indemnified Amounts or if such
Indemnified Amounts are attributable to Other Transferors and not
attributable to any Parent Group Member, such Other Transferors shall be
solely liable for such Indemnified Amounts;
(xix) any reduction or extinguishment of, or any failure by any
Obligor to pay (in whole or in part), any Receivable or any Related
Security with respect thereto as a result of or on account of any violation
of or prohibition under any law, rule or regulation now or hereafter in
effect from time to time, including without limitation and CHAMPUS/VA
Regulation, any Medicaid Regulation or any Medicare Regulation, or as a
result of or on account of the entering of any judicial or regulatory order
or agreement adversely affecting the Transferor or any Parent Group Member;
or
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(xx) any failure by the Transferor or any Parent Group Member to
maintain all governmental and other authorization and approvals necessary
to render the services, or sell the merchandise, resulting in Receivables;
or
(xxi) any failure of the computer applications of the Transferor, the
Seller, the Collection Agent or any Transferring Affiliate (including those
of suppliers, vendors and customers and the Receivables Systems) to be Year
2000 Compliant at any time.
SECTION 8.2. Indemnity for Taxes, Reserves and Expenses. (a) If after the
date hereof, the adoption of any Law or bank regulatory guideline or any
amendment or change in the interpretation of any existing or future Law or bank
regulatory guideline by any Official Body charged with the administration,
interpretation or application thereof, or the compliance with any directive of
any Official Body (in the case of any bank regulatory guideline, whether or not
having the force of Law):
(i) shall subject any Indemnified Party to any tax, duty or other
charge (other than Excluded Taxes) with respect to this Agreement, the
other Transaction Documents, the ownership, maintenance or financing of the
Transferred Interest, the Receivables or payments of amounts due hereunder,
or shall change the basis of taxation of payments to any Indemnified Party
of amounts payable in respect of this Agreement, the other Transaction
Documents, the ownership, maintenance or financing of the Transferred
Interest, the Receivables or payments of amounts due hereunder or its
obligation to advance funds hereunder, under a Liquidity Provider Agreement
or the credit support furnished by a Credit Support Provider or otherwise
in respect of this Agreement, the other Transaction Documents, the
ownership, maintenance or financing of the Transferred Interest or the
Receivables (except for changes in the rate of general corporate,
franchise, net income or other income tax imposed on such Indemnified Party
by the jurisdiction in which such Indemnified Party's principal executive
office is located);
(ii) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve
System) against assets of, deposits with or for the account of, or credit
extended by, any Indemnified Party or shall impose on any Indemnified Party
or on the United States market for certificates of deposit or the London
interbank market any other condition affecting this Agreement, the other
Transaction Documents, the ownership, maintenance or financing of the
Transferred Interest, the Receivables or payments of amounts due hereunder
or its obligation to advance funds hereunder under a Liquidity Provider
Agreement or the credit support provided by a Credit Support Provider or
otherwise in respect of this Agreement, the other Transaction Documents,
the ownership, maintenance or financing of the Transferred Interest or the
Receivables; or
(iii) imposes upon any Indemnified Party any other expense (including,
without limitation, reasonable attorneys' fees and expenses, and expenses
of litigation or preparation therefor in contesting any of the foregoing)
with respect to this Agreement,
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the other Transaction Documents, the ownership, maintenance or financing of
the Transferred Interest, the Receivables or payments of amounts due
hereunder or its obligation to advance funds hereunder under a Liquidity
Provider Agreement or the credit support furnished by a Credit Support
Provider or otherwise in respect to this Agreement, the other Transaction
Documents, the ownership, maintenance or financing of the Transferred
Interests or the Receivables, and the result of any of the foregoing is to
increase the cost to such Indemnified Party with respect to this Agreement,
the other Transaction Documents, the ownership, maintenance or financing of
the Transferred Interest, the Receivables, the obligations hereunder, the
funding of any purchases hereunder, a Liquidity Provider Agreement or a
Credit Support Agreement, by an amount deemed by such Indemnified Party to
be material,
then, within ten (10) days after demand by such Indemnified Party through any
Administrative Agent, the Transferor shall pay to such Administrative Agent for
the benefit of such Indemnified Party, such additional amount or amounts as will
compensate such Indemnified Party for such tax, increased cost or reduction.
(b) If any Indemnified Party shall have determined that after the date
hereof, the adoption of any applicable Law or bank regulatory guideline
regarding capital adequacy, or any change therein, or any change in the
interpretation thereof by any Official Body, or any directive regarding capital
adequacy (in the case of any bank regulatory guideline, whether or not having
the force of law) of any such Official Body, has or would have the effect of
reducing the rate of return on capital of such Indemnified Party (or its parent)
as a consequence of such Indemnified Party's obligations hereunder or with
respect hereto to a level below that which such Indemnified Party (or its
parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Indemnified Party to be material, then from time to time,
within ten (10) days after demand by such Indemnified Party through any
Administrative Agent, the Transferor shall pay to such Administrative Agent, for
the benefit of such Indemnified Party, such additional amount or amounts as will
compensate such Indemnified Party (or its parent) for such reduction.
(c) Each Administrative Agent will promptly notify the Transferor of
any event of which it has knowledge, occurring after the date hereof, which will
entitle an Indemnified Party to compensation pursuant to this Section 8.2. A
notice by an Administrative Agent Agent or the applicable Indemnified Party
claiming compensation under this Section and setting forth the additional amount
or amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Administrative Agent or any
applicable Indemnified Party may use any reasonable averaging and attributing
methods.
(d) Anything in this Section 8.2 to the contrary notwithstanding, if a
Conduit Investor enters into agreements for the acquisition of interests in
receivables from one or more Other Transferors, such Conduit Investor shall
allocate the liability for any amounts under this Section 8.2 which are in
connection with a Credit Support Agreement or the credit support provided by the
Credit Support Provider or, in the case of Enterprise, the Liquidity Provider
Agreement to which Enterprise is a party ("Section 8.2 Costs") to the Transferor
and each Other
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Transferor; provided, however, that if such Section 8.2 Costs are attributable
to any Parent Group Member and not attributable to any Other Transferor, the
Transferor shall be solely liable for such Section 8.2 Costs or if such Section
8.2 Costs are attributable to Other Transferors and not attributable to any
Parent Group Member, such Other Transferors shall be solely liable for such
Section 8.2 Costs.
SECTION 8.3. Taxes. (a) All payments made hereunder by the Transferor or
the Collection Agent (each, a "Payor") to any Investor, any Administrative Agent
or the Agent (each, a "Recipient") shall be made free and clear of and without
deduction for any present or future income, excise, stamp or franchise taxes and
any other taxes, fees, duties, withholdings or other charges of any nature
whatsoever imposed by any taxing authority on any recipient (or any assignee of
such parties) (such non-excluded items being called "Taxes"), but excluding
franchise taxes and taxes imposed on or measured by the recipient's net income
or gross receipts ("Excluded Taxes"). In the event that any withholding or
deduction from any payment made by the Payor hereunder is required in respect of
any Taxes, then such Payor shall:
(i) pay directly to the relevant authority the full amount required to
be so withheld or deducted;
(ii) promptly forward to each Administrative Agent an official receipt
or other documentation satisfactory to the Administrative Agent evidencing such
payment to such authority; and
(iii) pay to the Recipient such additional amount or amounts as is
necessary to ensure that the net amount actually received by the Recipient will
equal the full amount such Recipient would have received had no such withholding
or deduction been required.
Moreover, if any Taxes are directly asserted against any Recipient with respect
to any payment received by such Recipient hereunder, the Recipient may pay such
Taxes and the Payor will promptly pay such additional amounts (including any
penalties, interest or expenses) as shall be necessary in order that the net
amount received by the Recipient after the payment of such Taxes (including any
Taxes on such additional amount) shall equal the amount such Recipient would
have received had such Taxes not been asserted. Notwithstanding the foregoing,
the Payor shall not be obligated to pay any such additional amounts pursuant to
clause (iii) above or pursuant to the immediately preceding sentence to a Bank
Investor that is not organized under the laws of the United States of America or
a state thereof if such Bank Investor shall have failed to comply with the
requirements of paragraph (b) of this Section 8.3 as of the time such Taxes are
due and payable.
If the Payor fails to pay any Taxes when due to the appropriate taxing
authority or fails to remit to the Recipient the required receipts or other
required documentary evidence, the Payor shall indemnify the Recipient for any
incremental Taxes, interest, or penalties that may become payable by any
Recipient as a result of any such failure.
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(b) Each Investor that is not incorporated under the laws of the United
States of America or a state thereof shall:
(X) (i) on or before the date of any payment by a Payor to such
Investor, deliver to such Payor, the Agent and the Administrative Agent for
its Related Group (A) two (2) duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor applicable form,
as the case may be, certifying that it is entitled to receive payments
hereunder without deduction or withholding of any United States federal
income taxes and (B) an Internal Revenue Service Form W-8 or W-9, or
successor applicable form, as the case may be, certifying that it is
entitled to an exemption from United States backup withholding tax;
(ii) deliver to each Payor, the Agent and the Administrative Agent for
its Related Group two (2) further copies of any such form or certification
on or before the date that any such form or certification expires or
becomes obsolete and after the occurrence of any event requiring a change
in the most recent form previously delivered by it to such Payor; and
(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by either Payor, the
Agent or the Administrative Agent for its Related Group; or
(Y) Each Investor or transferee that is not a "bank" under Section
881(c)(3)(A) of the Internal Revenue Code thereof shall:
(i) on or before the date it becomes a party hereto (or, in the case
of a participant, on or before the date such participant becomes a
participant hereunder), deliver to each Payor, the Agent and the
Administrative Agent for its Related Group (i) a statement under penalties
of perjury that such Investor or transferee (x) is not a "bank" under
Section 881(c)(3)(A) of the Internal Revenue Code, is not subject to
regulatory or other legal requirements as a bank in any jurisdiction, and
has not been treated as a bank for purposes of any tax, securities law or
other filing or submission made to any governmental authority, any
application made to a rating agency or qualification for any exemption from
tax, securities law or other legal requirements, (y) is not a 10-percent
shareholder within the meaning of Section 811(c)(3)(B) of the Internal
Revenue Code and (z) is not a controlled foreign corporation receiving
interest from a related person within the meaning of Section 881(c)(3)(C)
of the Internal Revenue Code and (ii) a properly completed and duly
executed Internal Revenue Service Form W-8 or applicable successor form;
(ii) deliver to each Payor, the Agent and its Administrative Agent two
further properly completed and duly executed copies of such Form W-8
expires or becomes obsolete or after the occurrence of any event requiring
a change in the most recent form previously delivered by it to such Payor
or upon the request of such Payor; and
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(iii) obtain such extensions of time for filing and completing such
forms or certifications as may be reasonably requested by either Payor, the
Agent or its Administrative Agent;
unless in any such case any change in treaty, law or regulation has occurred
after the date such Person becomes an Investor hereunder which renders all such
forms inapplicable or which would prevent such Investor from duly completing and
delivering any such form with respect to it and such Investor so advises each
Payor, the Agent and its Administrative Agent. Each Person that shall become an
Investor or a participant of an Investor pursuant to subsection 10.6 shall, upon
the effectiveness of the related transfer, be required to provide all of the
forms, certifications and statements required pursuant to this subsection,
provided that in the case of a participant of an Investor the obligations of
such participant of an Investor pursuant to this subsection (b) shall be
determined as if the participant of an Investor were an Investor except that
such participant of an Investor shall furnish all such required forms,
certifications and statements to the Investor from which the related
participation shall have been purchased.
SECTION 8.4. Other Costs, Expenses and Related Matters. (a) The Transferor
agrees, upon receipt of a written invoice, to pay or cause to be paid, and to
save the Investors, the Administrative Agents and the Agent harmless against
liability for the payment of, all reasonable out-of-pocket expenses (including,
without limitation, attorneys', accountants' and other third parties' fees and
expenses, any filing fees and expenses incurred by officers or employees of any
of the Investors, the Administrative Agents and/or the Agent) or intangible,
documentary or recording taxes incurred by or on behalf of any Investor, any
Administrative Agent or the Agent (i) in connection with the negotiation,
execution, delivery and preparation of this Agreement, the other Transaction
Documents and any documents or instruments delivered pursuant hereto and thereto
and the transactions contemplated hereby or thereby (including, without
limitation, the perfection or protection of the Transferred Interest) and (ii)
from time to time (a) relating to any amendments, waivers or consents under this
Agreement and the other Transaction Documents, (b) arising in connection with
any Investor's, any Administrative Agent's, the Agent's or any Collateral
Agent's enforcement or preservation of rights (including, without limitation,
the perfection and protection of the Transferred Interest under this Agreement),
or (c) arising in connection with any audit, dispute, disagreement, litigation
or preparation for litigation involving this Agreement or any of the other
Transaction Documents (all of such amounts, collectively, "Transaction Costs").
(b) With respect to any Tranche to which all or any portion of the Net
Investment held by any of the Investors in a Related Group has been allocated,
the Transferor shall pay to the Administrative Agent for such Related Group, for
the account of each applicable Investor, on demand any Early Collection Fee due
on account of the reduction of such Tranche on a day prior to the last day of
its Tranche Period.
SECTION 8.5. Reconveyance Under Certain Circumstances. The Transferor
agrees to accept the reconveyance from the Agent, on behalf of the applicable
Investors, of the Transferred Interest if the Agent or any Administrative Agent
notifies Transferor of a material breach of any representation or warranty made
or deemed made pursuant to Article III of this Agreement and Transferor shall
fail to cure such breach within 15 days (or, in the case of the
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representations and warranties in Sections 3.1(d) and 3.1(j), 3 days) of such
notice. The reconveyance price shall be paid by the Transferor to the Agent, for
the account of the applicable Investors, as applicable, in immediately available
funds on such 15th day (or 3rd day, if applicable) in an amount equal to the
Aggregate Unpaids; provided that if such 15th day (or 3rd day) is not a Business
Day, such reconveyance and the related payment shall be made on the next
following Business Day.
ARTICLE IX
THE AGENT; BANK COMMITMENT; THE ADMINISTRATIVE AGENTS
SECTION 9.1. Authorization and Action. (a) Each Investor hereby appoints
and authorizes the Agent to take such action as agent on its behalf and to
exercise such powers under this Agreement and the other Transaction Documents as
are delegated to the Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto. In furtherance, and without
limiting the generality, of the foregoing, each Investor hereby appoints the
Agent as its agent to execute and deliver all further instruments and documents,
and take all further action that the Agent may deem necessary or appropriate or
that any Investor may reasonably request in order to perfect, protect or more
fully evidence the interests transferred or to be transferred from time to time
by the Transferor hereunder, or to enable any of them to exercise or enforce any
of their respective rights hereunder, including, without limitation, the
execution by the Agent as secured party/assignee of such financing or
continuation statements, or amendments thereto or assignments thereof, relative
to all or any of the Receivables now existing or hereafter arising, and such
other instruments or notices, as may be necessary or appropriate for the
purposes stated hereinabove. The Majority Investors may direct the Agent to take
any such incidental action hereunder. With respect to other actions which are
incidental to the actions specifically delegated to the Agent hereunder, the
Agent shall not be required to take any such incidental action hereunder, but
shall be required to act or to refrain from acting (and shall be fully protected
in acting or refraining from acting) upon the direction of the Majority
Investors; provided, however, the Agent shall not be required to take any action
hereunder if the taking of such action, in the reasonable determination of the
Agent, shall be in violation of any applicable law, rule or regulation or
contrary to any provision of this Agreement or shall expose the Agent to
liability hereunder or otherwise. Upon the occurrence and during the continuance
of any Termination Event or Potential Termination Event, the Agent shall take no
action hereunder (other than ministerial actions or such actions as are
specifically provided for herein) without the prior consent of the Majority
Investors (which consent shall not be unreasonably withheld or delayed). The
Agent shall not, without the prior written consent of all Bank Investors, agree
to (i) amend, modify or waive any provision of this Agreement in any way which
would (A) reduce or impair Collections or the payment of Discount or fees
payable hereunder to the Bank Investors or delay the scheduled dates for payment
of such amounts, (B) increase the Servicing Fee (other than as permitted
pursuant to Section 6.2(b)), (C) modify any provisions of this Agreement or the
Receivables Purchase Agreement or the Parent Agreement relating to the
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timing of payments required to be made by the Transferor, any Originating
Entity, FMC or FMCH or the application of the proceeds of such payments, (D)
permit the appointment of any Person (other than the Agent) as successor
Collection Agent, (E) release any property from the lien provided by this
Agreement (other than as expressly contemplated herein) or (F) extend or permit
the extension of the Commitment Termination Date without the consent of each
Bank Investor. The Agent shall not, without the prior written consent of each
Administrative Agent, agree to amend, modify or waive any provision of this
Agreement, the Transferring Affiliate Letter, the BMA Transfer Agreement, the
Receivables Purchase Agreement or the Parent Agreement. The Agent shall not
agree to any amendment of this Agreement which increases the dollar amount of a
Bank Investor's Commitment without the prior consent of such Bank Investor. In
addition, the Agent shall not agree to any amendment of this Agreement not
specifically described in the two preceding sentences without the consent of the
related Majority Investors (which consent shall not be unreasonably withheld or
delayed). In the event the Agent requests any Investor's consent pursuant to the
foregoing provisions and the Agent does not receive a consent (either positive
or negative) from such Investor within 10 Business Days of such Investor's
receipt of such request, then such Investor (and its percentage interest
hereunder) shall be disregarded in determining whether the Agent shall have
obtained sufficient consent hereunder.
(b) The Agent shall exercise such rights and powers vested in it by
this Agreement and the other Transaction Documents, and use the same degree of
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of such person's own affairs.
SECTION 9.2. Agent's Reliance, Etc. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them as Agent under or in connection with this
Agreement or any of the other Transaction Documents, except for its or their own
gross negligence or willful misconduct. Without limiting the foregoing, the
Agent: (i) may consult with legal counsel (including counsel for any Parent
Group Member), independent public accountants and other experts selected by it
and shall not be liable for any action taken or omitted to be taken in good
faith by it in accordance with the advice of such counsel, accountants or
experts; (ii) makes no warranty or representation to any Investor and shall not
be responsible to any Investor for any statements, warranties or representations
made in or in connection with this Agreement; (iii) shall not have any duty to
ascertain or to inquire as to the performance or observance of any of the terms,
covenants or conditions of this Agreement or any of the other Transaction
Documents on the part of any Parent Group Member or the Collection Agent or to
inspect the property (including the books and records) of any Parent Group
Member or the Collection Agent; (iv) shall not be responsible to any Investor
for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any of the other Transaction Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(v) shall incur no liability under or in respect of this Agreement or any of the
other Transaction Documents by acting upon any notice (including notice by
telephone), consent, certificate or other instrument or writing (which may be by
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
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SECTION 9.3. Credit Decision. Each Investor acknowledges that it has,
independently and without reliance upon the Agent, any Administrative Agent, any
Affiliate of an Administrative Agent or any other Investor and based upon such
documents and information as it has deemed appropriate, made its own evaluation
and decision to enter into this Agreement and the other Transaction Documents to
which it is a party and, if it so determines, to accept the transfer to the
Agent on its behalf of any undivided ownership interest in the Affected Assets
hereunder. Each Investor also acknowledges that it will, independently and
without reliance upon the Agent, any of the Agent's Affiliates or any other
Investor and based on such documents and information as it shall deem
appropriate at the time, continue to make its own decisions in taking or not
taking action under this Agreement and the other Transaction Documents to which
it is a party.
SECTION 9.4. Indemnification of the Agent. The Bank Investors agree to
indemnify the Agent (to the extent not reimbursed by the Transferor), ratably in
accordance with their Ratable Shares, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against the Agent in any way relating to or arising
out of this Agreement or any action taken or omitted by the Agent, any of the
other Transaction Documents hereunder or thereunder, provided that the Bank
Investors shall not be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Agent's gross negligence or willful misconduct.
Without limitation of the foregoing, the Bank Investors agree to reimburse the
Agent, ratably in accordance with their Ratable Shares, promptly upon demand for
any out-of-pocket expenses (including counsel fees) incurred by the Agent in
connection with the administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement and the
other Transaction Documents, to the extent that such expenses are incurred in
the interests of or otherwise in respect of the Bank Investors hereunder and/or
thereunder and to the extent that the Agent is not reimbursed for such expenses
by the Transferor.
SECTION 9.5. Successor Agent. The Agent may resign at any time by giving
written notice thereof to each Investor and the Transferor and may be removed at
any time with cause by the Majority Investors. Upon any such resignation or
removal, the Majority Investors shall appoint a successor Agent. Each Investor
agrees that it shall not unreasonably withhold or delay its approval of the
appointment of a successor Agent. If no such successor Agent shall have been so
appointed, and shall have accepted such appointment, within 30 days after the
retiring Agent's giving of notice of resignation or the Majority Investors'
removal of the retiring Agent, then the retiring Agent may, on behalf of the
Investors, appoint a successor Agent which successor Agent shall be either (i) a
commercial bank organized under the laws of the United States or of any state
thereof and have a combined capital and surplus of at least $50,000,000 or (ii)
an Affiliate of such a bank. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation or
removal hereunder as Agent, the provisions of this Article IX shall continue to
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inure to its benefit as to any actions taken or omitted to be taken by it while
it was Agent under this Agreement.
SECTION 9.6. Payments by the Agent. Unless specifically allocated to an
Investor pursuant to the terms of this Agreement, all amounts received by the
Agent on behalf of the Investors shall be paid by the Agent to the Investors (at
their respective accounts specified in their respective Assignment and
Assumption Agreements) in accordance with their respective related pro rata
interests in the Net Investment on the Business Day received by the Agent,
unless such amounts are received after 12:00 noon on such Business Day, in which
case the Agent shall use its reasonable efforts to pay such amounts to the
Investors on such Business Day, but, in any event, shall pay such amounts to the
Investors in accordance with their respective related pro rata interests in the
Net Investment not later than the following Business Day.
SECTION 9.7. Bank Commitment; Assignment to Bank Investors.
(a) Bank Commitment. At any time on or prior to the Commitment
Termination Date, in the event that a Conduit Investor does not effect an
Incremental Transfer as requested under Section 2.2(a), then at any time, the
Transferor shall have the right to require such Conduit Investor to assign its
interest in the Net Investment in whole to the Bank Investors in its Related
Group pursuant to this Section 9.7. In addition, at any time on or prior to the
Commitment Termination Date, (i) upon the occurrence of a Termination Event that
results in the Termination Date or (ii) if a Conduit Investor elects to give
notice to the Transferor of a Reinvestment Termination Date, the Transferor
hereby requests and directs that such Conduit Investor assign its interest in
the Net Investment in whole to the Bank Investors in its Related Group pursuant
to this Section 9.7 and the Transferor hereby agrees to pay the amounts
described in Section 9.7(d) below. Provided that the Net Asset Test is
satisfied, upon any such election by a Conduit Investor or any such request by
the Transferor to such Conduit Investor, such Conduit Investor shall make such
assignment and the Bank Investors in its Related Group shall accept such
assignment and shall assume all of such Conduit Investor's obligations
hereunder. In connection with any assignment from a Conduit Investor to the Bank
Investors in its Related Group pursuant to this Section 9.7, each Bank Investor
shall, on the date of such assignment, pay to such Conduit Investor an amount
equal to its Assignment Amount. Upon any assignment by a Conduit Investor to the
Bank Investors in its Related Group as contemplated hereunder, such Conduit
Investor shall cease to make any additional Incremental Transfers hereunder.
(b) Assignment. No Bank Investor may assign all or a portion of its
interests in the Net Investment, the Receivables, and Collections, Related
Security and Proceeds with respect thereto and its rights and obligations
hereunder to any Person unless approved in writing by the Administrative Agent
for its Related Group, on behalf of the related Conduit Investor. In the case of
an assignment by a Conduit Investor to the Bank Investors or by a Bank Investor
to another Person, the assignor shall deliver to the assignee(s) an Assignment
and Assumption Agreement in substantially the form of Exhibit G attached hereto,
duly executed, assigning to the assignee a pro rata interest in the Net
Investment, the Receivables, and Collections, Related Security and Proceeds with
respect thereto and the assignor's rights and obligations hereunder and the
assignor shall promptly execute and deliver all further instruments
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and documents, and take all further action, that the assignee may reasonably
request, in order to protect, or more fully evidence the assignee's right, title
and interest in and to such interest and to enable the Agent, on behalf of such
assignee, to exercise or enforce any rights hereunder and under the other
Transaction Documents to which such assignor is or, immediately prior to such
assignment, was a party. Upon any such assignment, (i) the assignee shall have
all of the rights and obligations of the assignor hereunder and under the other
Transaction Documents to which such assignor is or, immediately prior to such
assignment, was a party with respect to such interest for all purposes, it being
understood that the Bank Investors, as assignees, shall (x) be obligated to fund
Incremental Transfers under Section 2.2(a) in accordance with the terms thereof,
notwithstanding that related Conduit Investor was not so obligated and (y) not
have the right to elect the commencement of the amortization of the Net
Investment pursuant to the definition of "Reinvestment Termination Date",
notwithstanding that the related Conduit Investor had such right) and (ii) the
assignor shall relinquish its rights with respect to such interest for all
purposes of this Agreement and under the other Transaction Documents to which
such assignor is or, immediately prior to such assignment, was a party. No such
assignment shall be effective unless a fully executed copy of the related
Assignment and Assumption Agreement shall be delivered to the Agent, the
Administrative Agent for the applicable Related Group and the Transferor. All
costs and expenses of the Agent, the applicable Administrative Agent and the
assignor and assignee incurred in connection with any assignment hereunder shall
be borne by the Transferor and not by the assignor or any such assignee. No Bank
Investor shall assign any portion of its Commitment hereunder without also
simultaneously assigning an equal portion of its interest in the applicable
Liquidity Provider Agreement.
(c) Effects of Assignment. By executing and delivering an Assignment
and Assumption Agreement, the assignor and assignee thereunder confirm to and
agree with each other and the other parties hereto as follows: (i) other than as
provided in such Assignment and Assumption Agreement, the assignor makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement, the other Transaction Documents or any other instrument or document
furnished pursuant hereto or thereto or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement, the other
Transaction Documents or any such other instrument or document; (ii) the
assignor makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Transferor, any Parent Group Member or
the Collection Agent or the performance or observance by the Transferor, any
Parent Group Member or the Collection Agent of any of their respective
obligations under this Agreement, the Receivables Purchase Agreement, the
Transferring Affiliate Letter, the BMA Transfer Agreement, the Parent Agreement,
the other Transaction Documents or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, the Receivables Purchase Agreement, the Transferring Affiliate
Letter, the BMA Transfer Agreement, the Parent Agreement, and such other
instruments, documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into such Assignment and Assumption
Agreement and to purchase such interest; (iv) such assignee will, independently
and without reliance upon the Agent, any Administrative Agent, or any of their
respective Affiliates, or the assignor and based on such agreements, 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 this Agreement and
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the other Transaction Documents; (v) such assignee appoints and authorizes the
Agent to take such action as agent on its behalf and to exercise such powers
under this Agreement, the other Transaction Documents and any other instrument
or document furnished pursuant hereto or thereto as are delegated to the Agent
by the terms hereof or thereof, together with such powers as are reasonably
incidental thereto and to enforce its respective rights and interests in and
under this Agreement, the other Transaction Documents, the Receivables, the
Contracts and the Related Security; (vi) such assignee appoints and authorizes
the applicable Administrative Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement, the other Transaction
Documents and any other instrument or document furnished pursuant hereto or
thereto as are delegated to the Administrative Agent by the terms hereof or
thereof, together with such powers as are reasonably incidental thereto and to
enforce its respective rights and interests in and under this Agreement, the
other Transaction Documents, the Receivables, the Contracts and the Related
Security, (vii) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement and the
other Transaction Documents are required to be performed by it as the assignee
of the assignor; and (viii) such assignee agrees that it will not institute
against any Conduit Investor any proceeding of the type referred to in Section
10.9 prior to the date which is one year and one day after the payment in full
of all Commercial Paper issued by such Conduit Investor or its Related CP
Issuer.
(d) Transferor's Obligation to Pay Certain Amounts; Additional
Assignment Amount. The Transferor shall pay to the Administrative Agent for a
Conduit Investor, for the account of such Conduit Investor, in connection with
any assignment by such Conduit Investor to the Bank Investors in its Related
Group pursuant to this Section 9.7, an aggregate amount equal to all Discount to
accrue through the end of each outstanding Tranche Period plus all other
Aggregate Unpaids (other than the Net Investment) owing to such Conduit
Investor. To the extent that such Discount relates to interest or discount on
Related Commercial Paper, if the Transferor fails to make payment of such
amounts at or prior to the time of assignment by such Conduit Investor to the
Bank Investors in its Related Group, such amount shall be paid by such Bank
Investors (in accordance with their respective Pro Rata Shares) to such Conduit
Investor as additional consideration for the interests assigned to such Bank
Investors and the amount of the "Net Investment" hereunder held by such Bank
Investors shall be increased by an amount equal to the additional amount so paid
by such Bank Investors.
(e) Administration of Agreement After Assignment. After any assignment
by a Conduit Investor to the Bank Investors in its Related Group pursuant to
this Section 9.7 (and the payment of all amounts owing to such Conduit Investor
in connection therewith), all rights of the related Collateral Agent set forth
herein shall be deemed to be afforded to the Administrative Agent for such
Related Group on behalf of such Bank Investors instead of such Collateral Agent.
(f) Payments. After any assignment by a Conduit Investor to the Bank
Investors in its Related Group pursuant to this Section 9.7, all payments to be
made hereunder by the Transferor or the Collection Agent to such Conduit
Investor shall be made to the applicable Administrative Agent's account as such
account shall have been notified to the Transferor and the Collection Agent.
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(g) Downgrade of Bank Investor. If (at any time prior to any assignment
by a Conduit Investor to the Bank Investors in its Related Group as contemplated
pursuant to this Section 9.7) the short term debt rating of any Bank Investor in
such Related Group shall be "A-2" or "P-2" from Standard & Poor's or Moody's,
respectively, with negative credit implications, such Bank Investor, upon
request of the applicable Administrative Agent, shall, within 30 days of such
request, assign its rights and obligations hereunder to another financial
institution (which institution's short term debt shall be rated at least "A-2"
and "P-2" from Standard & Poor's and Moody's, respectively, and which shall not
be so rated with negative credit implications). If the short term debt rating of
a Bank Investor in a Related Group shall be "A-3" or "P-3", or lower, from
Standard & Poor's or Moody's, respectively (or such rating shall have been
withdrawn by Standard & Poor's or Moody's), such Bank Investor, upon request of
the applicable Administrative Agent, shall, within five (5) Business Days of
such request, assign its rights and obligations hereunder to another financial
institution (which institution's short term debt shall be rated at least "A-2"
and "P-2" from Standard & Poor's and Moody's, respectively, and which shall not
be so rated with negative credit implications). In either such case, if any such
Bank Investor in a Related Group shall not have assigned its rights and
obligations under this Agreement within the applicable time period described
above, the related Conduit Investor shall have the right to require such Bank
Investor to accept the assignment of such Bank Investor's Pro Rata Share of the
Net Investment; such assignment shall occur in accordance with the applicable
provisions of this Section 9.7. Such Bank Investor shall be obligated to pay to
such Conduit Investor, in connection with such assignment, in addition to the
Pro Rata Share of the Net Investment, an amount equal to the Interest Component
of the outstanding Commercial Paper issued to fund the portion of the Net
Investment being assigned to such Bank Investor, as reasonably determined by the
applicable Administrative Agent. Notwithstanding anything contained herein to
the contrary, upon any such assignment to a downgraded Bank Investor as
contemplated pursuant to the immediately preceding sentence, the aggregate
available amount of the applicable Related Group Limit, solely as it relates to
new Incremental Transfers to such Conduit Investor, shall be reduced by the
amount of unused Commitment of such downgraded Bank Investor; it being
understood and agreed, that nothing in this sentence or the two preceding
sentences shall affect or diminish in any way any such downgraded Bank
Investor's Commitment to the Transferor or such downgraded Bank Investor's other
obligations and liabilities hereunder and under the other Transaction Documents.
SECTION 9.8. Appointment of Administrative Agents. (a) Each Investor in a
Related Group hereby appoints and authorizes the Administrative Agent for its
Related Group to take such action as agent on its behalf and to exercise such
powers under this Agreement and the other Transaction Documents as are delegated
to such Administrative Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto. In furtherance, and without
limiting the generality, of the foregoing, each Investor in a Related Group
hereby appoints the Administrative Agent for its Related Group as its agent to
execute and deliver all further instruments and documents, and take all further
action that such Administrative Agent may deem necessary or appropriate or that
any Investor may reasonably request to enable any of them to exercise or enforce
any of their respective rights hereunder. Bank Investors representing at least
66 and 2/3% of the aggregate Commitments of all Bank Investors in a Related
Group (the "Group Majority Investors") may direct the Administrative Agent for
such Related Group to take any such incidental action hereunder. With respect to
other actions which are incidental to the
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actions specifically delegated to an Administrative Agent hereunder, such
Administrative Agent shall not be required to take any such incidental action
hereunder, but shall be required to act or to refrain from acting (and shall be
fully protected in acting or refraining from acting) upon the direction of the
Group Majority Investors; provided, however, no Administrative Agent shall be
required to take any action hereunder if the taking of such action, in the
reasonable determination of such Administrative Agent, shall be in violation of
any applicable law, rule or regulation or contrary to any provision of this
Agreement or shall expose such Administrative Agent to liability hereunder or
otherwise. Upon the occurrence and during the continuance of any Termination
Event or Potential Termination Event, the Administrative Agent for a Related
Group shall take no action hereunder (other than ministerial actions or such
actions as are specifically provided for herein) without the prior consent of
the Group Majority Investors (which consent shall not be unreasonably withheld
or delayed). The Administrative Agent for a Related Group shall not, without the
prior written consent of all Bank Investors in such Related Group, agree to (i)
amend, modify or waive any provision of this Agreement in any way which would
(A) reduce or impair Collections or the payment of Discount or fees payable
hereunder to the Bank Investors in such Related Group or delay the scheduled
dates for payment of such amounts, (B) increase the Servicing Fee (other than as
permitted pursuant to Section 6.2(b)), (C) modify any provisions of this
Agreement or the Receivables Purchase Agreement or the Parent Agreement relating
to the timing of payments required to be made by the Transferor, any Originating
Entity, FMC or FMCH or the application of the proceeds of such payments, (D)
permit the appointment of any Person (other than the Agent) as successor
Collection Agent, (E) release any property from the lien provided by this
Agreement (other than as expressly contemplated herein) or (F) extend or permit
the extension of the Commitment Termination Date without the consent of each
Bank Investor in such Related Group. The Administrative Agent for a Related
Group shall not agree to any amendment of this Agreement which increases the
dollar amount of the Commitment of a Bank Investor in such Related Group without
the prior consent of such Bank Investor. In addition, no Administrative Agent
shall agree to any amendment of this Agreement not specifically described in the
two preceding sentences without the consent of the related Group Majority
Investors (which consent shall not be unreasonably withheld or delayed). In the
event an Administrative Agent requests any Investor's consent pursuant to the
foregoing provisions and such Administrative Agent does not receive a consent
(either positive or negative) from such Investor within 10 Business Days of such
Investor's receipt of such request, then such Investor (and its percentage
interest hereunder) shall be disregarded in determining whether such
Administrative Agent shall have obtained sufficient consent hereunder.
(b) Each Administrative Agent shall exercise such rights and powers
vested in it by this Agreement and the other Transaction Documents, and use the
same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
SECTION 9.9. Administrative Agent's Reliance, Etc. Neither any
Administrative Agent nor any directors, officers, agents or employees of an
Administrative Agent shall be liable for any action taken or omitted to be taken
by it or them as Administrative Agent under or in connection with this Agreement
or any of the other Transaction Documents, except for its or their own gross
negligence or willful misconduct. Without limiting the foregoing, each
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Administrative Agent: (i) may consult with legal counsel (including counsel for
any Parent Group Member), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (ii) makes no warranty or representation to any Investor
and shall not be responsible to any Investor for any statements, warranties or
representations made in or in connection with this Agreement; (iii) shall not
have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of this Agreement or any of the other
Transaction Documents on the part of any Parent Group Member or the Collection
Agent or to inspect the property (including the books and records) of any Parent
Group Member or the Collection Agent; (iv) shall not be responsible to any
Investor for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any of the other Transaction Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(v) shall incur no liability under or in respect of this Agreement or any of the
other Transaction Documents by acting upon any notice (including notice by
telephone), consent, certificate or other instrument or writing (which may be by
telex) believed by it to be genuine and signed or sent by the proper party or
parties.
SECTION 9.10. Indemnification of the Administrative Agents. The Bank
Investors in each Related Group agree to indemnify the Administrative Agent for
such Related Group (to the extent not reimbursed by the Transferor), ratably in
accordance with their Pro Rata Shares, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be imposed
on, incurred by, or asserted against such Administrative Agent in any way
relating to or arising out of this Agreement or any action taken or omitted by
such Administrative Agent, any of the other Transaction Documents hereunder or
thereunder, provided that the Bank Investors in a Related Group shall not be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the applicable Administrative Agent's gross negligence or willful
misconduct. Without limitation of the foregoing, the Bank Investors in each
Related Group agree to reimburse the Administrative Agent for such Related
Group, ratably in accordance with their Pro Rata Shares, promptly upon demand
for any out-of-pocket expenses (including counsel fees) incurred by such
Administrative Agent in connection with the administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or
otherwise) of, or legal advice in respect of rights or responsibilities under,
this Agreement and the other Transaction Documents, to the extent that such
expenses are incurred in the interests of or otherwise in respect of such Bank
Investors hereunder and/or thereunder and to the extent that such Administrative
Agent is not reimbursed for such expenses by the Transferor.
SECTION 9.11. Successor Administrative Agents. Any Administrative Agent may
resign at any time by giving written notice thereof to the Agent, each Investor
in its Related Group and the Transferor and may be removed at any time with
cause by the applicable Group Majority Investors. Upon any such resignation or
removal, the Group Majority Investors for such Related Group shall appoint a
successor Administrative Agent. Each Investor agrees that it shall not
unreasonably withhold or delay its approval of the appointment of a successor
Administrative Agent. If no such successor Adminisrative Agent shall have been
so appointed for such Related Group, and shall have accepted such appointment,
within 30 days after the
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retiring Administrative Agent's giving of notice of resignation or the Group
Majority Investors' removal of the retiring Administrative Agent, then the
retiring Administrative Agent may, on behalf of the Investors in such Related
Group, appoint a successor Administrative Agent for such Related Group which
successor Administrative Agent shall be either (i) a commercial bank having a
combined capital and surplus of at least $50,000,000 or (ii) an Affiliate of
such a bank. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Administrative Agent's resignation or removal
hereunder as Administrative Agent, the provisions of this Article IX shall
continue to inure to its benefit as to any actions taken or omitted to be taken
by it while it was Administrative Agent under this Agreement.
SECTION 9.12. Payments by the Administrative Agents. Unless specifically
allocated to an Investor pursuant to the terms of this Agreement, all amounts
received by an Administrative Agent on behalf of the Investors in its Related
Group shall be paid by such Administrative Agent to the Investors in its Related
Group (at their respective accounts specified in their respective Assignment and
Assumption Agreements) in accordance with their respective related pro rata
interests in the Net Investment on the Business Day received by such
Administrative Agent, unless such amounts are received after 12:00 noon on such
Business Day, in which case such Administrative Agent shall use its reasonable
efforts to pay such amounts to the Investors in its Related Group on such
Business Day, but, in any event, shall pay such amounts to such Investors in
accordance with their respective related pro rata interests in the Net
Investment not later than the following Business Day.
ARTICLE X
MISCELLANEOUS
SECTION 10.1. Term of Agreement. This Agreement shall terminate on the date
following the Termination Date upon which the Net Investment has been reduced to
zero, all accrued Discount and Servicing Fees have been paid in full and all
other Aggregate Unpaids have been paid in full, in each case, in cash; provided,
however, that (i) the rights and remedies of the Agent, the Investors and the
Administrative Agents with respect to any representation and warranty made or
deemed to be made by the Transferor pursuant to this Agreement, (ii) the
indemnification and payment provisions of Article VIII, and (iii) the agreement
set forth in Section 10.9 hereof, shall be continuing and shall survive any
termination of this Agreement.
SECTION 10.2. Waivers; Amendments. No failure or delay on the part of the
Agent, any Investor or any Administrative Agent in exercising any power, right
or remedy under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power, right or remedy preclude any other
further exercise thereof or the exercise of
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any other power, right or remedy. The rights and remedies herein provided shall
be cumulative and nonexclusive of any rights or remedies provided by law. Any
provision of this Agreement may be amended or waived if, but only if, in the
case of any amendment, such amendment is in writing and is signed by the
Transferor, the Agent, each Administrative Agent and the Majority Investors and
in the case of any waiver, such waiver is granted in writing by each
Administrative Agent.
SECTION 10.3. Notices. Except as provided below, all communications and
notices provided for hereunder shall be in writing (including telecopy or
electronic facsimile transmission or similar writing) and shall be given to the
other party at its address or telecopy number set forth below or at such other
address or telecopy number as such party may hereafter specify for the purposes
of notice to such party. Each such notice or other communication shall be
effective (i) if given by telecopy when such telecopy is transmitted to the
telecopy number specified in this Section 10.3 and confirmation is received,
(ii) if given by mail 3 Business Days following such posting, postage prepaid,
U.S. certified or registered, (iii) if given by overnight courier, one (1)
Business Day after deposit thereof with a national overnight courier service, or
(iv) if given by any other means, when received at the address specified in this
Section 10.3. However, anything in this Section to the contrary notwithstanding,
the Transferor hereby authorizes each Investor, each Administrative Agent and
the Agent to effect Transfers, Tranche Period and Tranche Rate selections based
on telephonic notices made by any Person which such Investor, such
Administrative Agent or the Agent, as applicable, in good faith believes to be
acting on behalf of the Transferor. The Transferor agrees to deliver promptly to
each such Investor or Administrative Agent or the Agent, as applicable, a
written confirmation of each telephonic notice directed to such Person signed by
an authorized officer of Transferor. However, the absence of such confirmation
shall not affect the validity of such notice. If the written confirmation
differs in any material respect from the action taken by the Agent or the
applicable Investor or Administrative Agent, the records of such Investor or
Administrative Agent or the Agent, as applicable shall govern absent manifest
error.
If to Enterprise:
Enterprise Funding Corporation
c/o Global Securitization Services
25 West 43rd Street, Suite 704
New York, New York 10036
Attention: Kevin Burns
Telephone: (212) 302-5151
Telecopy: (212) 302-8767
(with a copy to its Administrative Agent)
If to the Transferor:
(NMC Funding Corporation)
95 Hayden Avenue
Lexington, Massachusetts 02420-9192
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Telephone: (781) 402-9161 or 9309
Telecopy: (781) 402-9756
Attn: James V. Luther/Ramon Yi
Payment Information:
Chase Manhattan Bank, N.A.
ABA 021-000-021
Account 323-0-78623
If to the Collection Agent:
National Medical Care, Inc.
95 Hayden Avenue
Lexington, Massachusetts 02420-9192
Telephone: (781) 402-9161 or 9309
Telecopy: (781) 402-9756
Attn: James V. Luther/Ramon Yi
If to the Collateral Agent related to Enterprise:
Bank of America, N.A.
Bank of America, Corporate Center--10th Floor
Charlotte, North Carolina 28255
Attention: Michelle M. Heath--
Structured Finance
Telephone: (704) 386-7922
Telecopy: (704) 388-9169
If to the Agent:
Bank of America, N.A.
Bank of America Corporate Center--10th Floor
Charlotte, North Carolina 28255
Attention: Michelle M. Heath--
Structured Finance
Telephone: (704) 386-7922
Telecopy: (704) 388-9169
Payment Information:
Bank of America, N.A.
ABA 053-000-196
for the account of Bank of America Charlotte
Account No. 1093601650000
Attn.: Camille Zerbinos
If to the Administrative Agent for Enterprise or the related
Collateral Agent:
Bank of America, N.A.
Bank of America Corporate Center--10th Floor
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Charlotte, North Carolina 28255
Attention: Michelle M. Heath--
Structured Finance
Telephone: (704) 386-7922
Telecopy: (704) 388-9169
If to Compass:
c/o Westdeutsche Landesbank Girozentrale, New York Branch
1211 Avenue of the Americas
New York, New York 10036
Attention: Michael Fitzgerald
Telephone: (212) 597-8356
Telecopy: (212) 852-5971
If to the Administrative Agent for Compass:
c/o Westdeutsche Landesbank Girozentrale, New York Branch
1211 Avenue of the Americas
New York, New York 10036
Attention: Michael Fitzgerald
Telephone: (212) 597-8356
Telecopy: (212) 852-5971
Payment Information:
Chase Manhattan Bank NY
ABA 021000021
A/C WestLB NY
A/C #9201060663
If to the Bank Investors, at their respective addresses set
forth on the signature pages hereto or of the Assignment and Assumption
Agreement pursuant to which it became a party hereto.
SECTION 10.4. Governing Law; Submission to Jurisdiction; Integration.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK. THE TRANSFEROR HEREBY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN
DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN THE CITY OF NEW
YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. Each of the Transferor and
the Collection Agent hereby irrevocably waives, to the fullest extent it may
effectively do so, any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum. Nothing in this
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Section 10.4 shall affect the right of any Investor to bring any action or
proceeding against the Transferor or the Collection Agent or any of their
respective properties in the courts of other jurisdictions.
(b) EACH OF THE PARTIES HERETO HEREBY WAIVES ANY RIGHT TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE AMONG ANY OF THEM ARISING OUT OF, CONNECTED WITH, RELATING TO OR
INCIDENTAL TO THE RELATIONSHIP BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR
THE OTHER TRANSACTION DOCUMENTS.
(c) This Agreement contains the 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 prior oral or written
understandings.
(d) The Transferor and NMC each hereby appoint John B. Madden, Jr., of
Arent Fox Kintner Plotkin & Kahn, located at 1675 Broadway, New York, New York
10019 as the authorized agent upon whom process may be served in any action
arising out of or based upon this Agreement, the other Transaction Documents to
which such Person is a party or the transactions contemplated hereby or thereby
that may be instituted in the United States District Court for the Southern
District of New York and of any New York State Court sitting in the City of New
York by any Administrative Agent, the Agent, any Investor, any Collateral Agent
or any assignee of any of them.
SECTION 10.5. Severability; Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute one and the same
Agreement. Any provisions of this Agreement which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 10.6. Successors and Assigns. (a) This Agreement shall be binding
on the parties hereto and their respective successors and assigns; provided,
however, that neither the Transferor nor the Collection Agent may assign any of
its rights or delegate any of its duties hereunder or under any of the other
Transaction Documents to which it is a party without the prior written consent
of each Administrative Agent. No provision of this Agreement shall in any manner
restrict the ability of any Conduit Investor or any Bank Investor to assign,
participate, grant security interests in, or otherwise transfer any portion of
the Transferred Interest.
(b) Each of the Transferor and the Collection Agent hereby agrees and
consents to the assignment by any Conduit Investor from time to time of all or
any part of its rights under, interest in and title to this Agreement and the
Transferred Interest to any Liquidity
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Provider for such Conduit Investor. In addition, each of the Transferor and the
Collection Agent hereby consents to and acknowledges the assignment by any
Conduit Investor of all of its rights under, interest in and title to this
Agreement and the Transferred Interest to the related Collateral Agent.
SECTION 10.7. Waiver of Confidentiality. The Transferor hereby consents to
the disclosure of any non-public information with respect to it received by any
Conduit Investor, the Agent, any Bank Investor or any Administrative Agent to
any of the Conduit Investors, the Agent, any nationally recognized rating agency
rating the Commercial Paper of such Conduit Investor or its Related CP Issuer,
any Administrative Agent, any Collateral Agent, any Bank Investor or potential
Bank Investor, any Liquidity Provider or any Credit Support Provider in relation
to this Agreement.
SECTION 10.8. Confidentiality Agreement. Each of the Transferor and the
Collection Agent hereby agrees that it will not disclose, and the Transferor
will cause each Parent Group Member to refrain from disclosing, the contents of
this Agreement or any other proprietary or confidential information of any
Conduit Investor, the Agent, any Administrative Agent, any Collateral Agent, any
Liquidity Provider or any Bank Investor to any other Person except (i) its
auditors and attorneys, employees or financial advisors (other than any
commercial bank) and any nationally recognized rating agency provided such
auditors, attorneys, employees financial advisors or rating agencies are
informed of the highly confidential nature of such information or (ii) following
notice thereof to each Administrative Agent, as otherwise required by applicable
law (including the federal securities laws) or order of a court of competent
jurisdiction.
SECTION 10.9. No Bankruptcy Petition Against Conduit Investors. Each of the
Transferor and the Collection Agent hereby covenants and agrees that, prior to
the date which is one year and one day after the payment in full of all
outstanding Commercial Paper or other indebtedness of any Conduit Investor or
its Related CP Issuer, it will not, and the Transferor will cause each Parent
Group Member to not, institute against, or join any other Person in instituting
against, such Conduit Investor or its Related CP Issuer any bankruptcy,
reorganization, arrangement insolvency or liquidation proceedings or other
similar proceeding under the laws of the United States or any state of the
United States.
SECTION 10.10. No Recourse Against Stockholders, Officers or Directors. No
recourse under any obligation, covenant or agreement of any Conduit Investor
contained in this Agreement shall be had against Merrill Lynch Money Markets
Inc. (nor any affiliate thereof), AMACAR Group L.L.C. (nor any affiliate
thereof), or any stockholder, officer or director of such Conduit Investor, as
such, by the enforcement of any assessment or by any legal or equitable
proceeding, by virtue of any statute or otherwise; it being expressly agreed and
understood that this Agreement is solely a corporate obligation of such Conduit
Investor, and that no personal liability whatsoever shall attach to or be
incurred by Merrill Lynch Money Markets Inc. (or any affiliate thereof), AMACAR
Group L.L.C. (or any affiliate thereof), or the stockholders, officers, or
directors of such Conduit Investor, as such, or any of them, under or by reason
of any of the obligations, covenants or agreements of such Conduit Investor
contained in this Agreement, or implied therefrom, and that any and all personal
liability for breaches by a
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Conduit Investor of any of such obligations, covenants or agreements, either at
common law or at equity, or by statute or constitution, of Merrill Lynch Money
Markets Inc. (or any affiliate thereof), AMACAR Group L.L.C. (or any affiliate
thereof) and every such stockholder, officer or director of such Conduit
Investor is hereby expressly waived as a condition of and consideration for the
execution of this Agreement.
SECTION 10.11. Characterization of the Transactions Contemplated by the
Agreement. It is the intention of the parties that the transactions contemplated
hereby constitute the sale of the Transferred Interest, conveying good title
thereto free and clear of any Adverse Claims to the Agent, on behalf of the
Investors, and that the Transferred Interest not be part of the Transferor's
estate in the event of an insolvency. If, notwithstanding the foregoing, the
transactions contemplated hereby should be deemed a financing, the parties
intend that the Transferor shall be deemed to have granted to the Agent, on
behalf of the Investors, and the Transferor hereby grants to the Agent, on
behalf of the Investors, a first priority perfected and continuing security
interest in all of the Transferor's right, title and interest in, to and under
the Receivables, together with Related Security, Collections and Proceeds with
respect thereto, and together with all of the Transferor's rights under the
Receivables Purchase Agreement, the Transferring Affiliate Letter, the BMA
Transfer Agreement and all other Transaction Documents with respect to the
Receivables and with respect to any obligations thereunder of any Originating
Entity with respect to the Receivables, and that this Agreement shall constitute
a security agreement under applicable law. The Transferror hereby assigns to the
Agent, on behalf of the Investors, all of its rights and remedies under the
Receivables Purchase Agreement, the Transferring Affiliate Letter and the BMA
Transfer Agreement (and all instruments, documents and agreements executed in
connection therewith) with respect to the Receivables and with respect to any
obligations thereunder of any Originating Entity with respect to the
Receivables.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have executed and
delivered this Transfer and Administration Agreement as of the date first
written above.
ENTERPRISE FUNDING CORPORATION,
as a Conduit Investor
By: /s/ Kevin P. Burns
Name: Kevin P. Burns
Title: Vice President
COMPASS US ACQUISITION, LLC,
as a Conduit Investor
By: /s/ Douglas K. Johnson
Name: Douglas K. Johnson
Title: President
NMC FUNDING CORPORATION,
as Transferor
By: /s/ James V. Luther
Name: James V. Luther
Title: Assistant Treasurer
NATIONAL MEDICAL CARE, INC., as
Collection Agent
By: /s/ James V. Luther
Name: James V. Luther
Title: Assistant Treasurer
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Commitment BANK OF AMERICA, N.A., as Agent, as an
Administrative Agent and as a Bank Investor
$180,000,000
By: /s/ Brian D. Krum
Name: Brian D. Krum
Title: Vice President
Commitment WESTDEUTSCHE LANDESBANK GIROZENTRALE,
$180,000,000 NEW YORK BRANCH, as an Administrative Agent
and as a Bank Investor
By: /s/ Michael E. Fitzgerald
Name: Michael E. Fitzgerald
Title: Director, Securitization
By: /s/ Christian C. Brune
Name: Christian C. Brune
Title: Associate, Securitization
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SCHEDULE I
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
NOTICE ADDRESSES FOR BANK INVESTORS
BANK OF AMERICA, N.A.
Bank of America Corporate Center--10th Floor
Charlotte, North Carolina 28255
Attention: Michelle M. Heath--
Structured Finance
Telephone: (704) 386-7922
Telecopy: (704) 388-9169
WESTDEUTSCHE LANDESBANK GIROZENTRALE,
NEW YORK BRANCH
1211 Avenue of the Americas
New York, New York 10036
Attention: Michael Fitzgerald
Telephone: (212) 597-8356
Telecopy: (212) 852-5971
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EXHIBIT A
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORMS OF CONTRACTS
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EXHIBIT B
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
CREDIT AND COLLECTION POLICIES AND PRACTICES
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EXHIBIT C
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
LIST OF SPECIAL ACCOUNT BANKS, DESIGNATED
ACCOUNT AGENTS AND CONCENTRATION BANK
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EXHIBIT D-1
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF SPECIAL ACCOUNT LETTER
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107
EXHIBIT D-2
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF CONCENTRATION ACCOUNT AGREEMENT
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108
EXHIBIT E
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF INVESTOR REPORT
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109
EXHIBIT F
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF TRANSFER CERTIFICATE
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110
EXHIBIT G
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
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EXHIBIT H
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
LIST OF ACTIONS AND SUITS
SECTIONS 3.1(g), 3.1(k) and 3.3(e)
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EXHIBIT I
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
LOCATION OF RECORDS
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EXHIBIT J
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
[RESERVED]
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EXHIBIT K
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORMS OF OPINIONS OF COUNSEL
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EXHIBIT L
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORMS OF SECRETARY'S CERTIFICATE
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EXHIBIT M
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF CERTIFICATE
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EXHIBIT N
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
LIST OF APPROVED FISCAL INTERMEDIARIES
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EXHIBIT O
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF TRANSFERRING AFFILIATE LETTER
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EXHIBIT P
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF PARENT AGREEMENT
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EXHIBIT Q
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
LIST OF TRANSFERRING AFFILIATES
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EXHIBIT R
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF ACCOUNT AGENT AGREEMENT
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EXHIBIT S
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
LIST OF CLOSING DOCUMENTS
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EXHIBIT T
to
AMENDED AND RESTATED
TRANSFER AND ADMINISTRATION AGREEMENT
FORM OF AMENDMENT TO PARENT AGREEMENT
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