1
EXHIBIT 10.1
LOAN AGREEMENT
DATED AS OF JULY 2, 2001
AMONG
CHOICEPOINT FINANCIAL INC., AS BORROWER,
CHOICEPOINT INC., AS INITIAL SERVICER,
THREE PILLARS FUNDING CORPORATION, AS LENDER,
AND
SUNTRUST EQUITABLE SECURITIES CORPORATION, AS ADMINISTRATOR
2
TABLE OF CONTENTS
PAGE
----
ARTICLE I. DEFINITIONS....................................................................................... 1
Section 1.1 Defined Terms................................................................................... 1
Section 1.2 Other Definitional Provisions................................................................... 19
Section 1.3 Other Terms..................................................................................... 20
Section 1.4 Computation of Time Periods..................................................................... 20
ARTICLE II. THE LENDER'S COMMITMENT, BORROWING PROCEDURES AND LENDER NOTE...................................... 20
Section 2.1 Lender's Commitment............................................................................. 20
Section 2.2 Borrowing Procedures............................................................................ 20
Section 2.3 Funding......................................................................................... 20
Section 2.4 Representation and Warranty..................................................................... 21
Section 2.5 Extension of Lender's Commitment................................................................ 21
Section 2.6 Voluntary Termination of Lender's Commitment; Reduction of Facility Limit....................... 21
Section 2.7 Note............................................................................................ 22
ARTICLE III. INTEREST, FEES, ETC................................................................................. 22
Section 3.1 Interest Rates.................................................................................. 22
Section 3.2 Interest Payment Dates.......................................................................... 23
Section 3.3 Interest Allocations............................................................................ 23
Section 3.4 Fees............................................................................................ 23
Section 3.5 Computation of Interest and Fees................................................................ 23
ARTICLE IV. REPAYMENTS AND PREPAYMENTS; DISTRIBUTION OF COLLECTIONS.............................................. 24
Section 4.1 Repayments and Prepayments...................................................................... 24
Section 4.2 Application of Collections...................................................................... 24
Section 4.3 Application of Certain Payments................................................................. 25
Section 4.4 Due Date Extension.............................................................................. 26
Section 4.5 Making of Payments.............................................................................. 26
ARTICLE V. SECURITY INTEREST.................................................................................. 26
Section 5.1 Grant of Security............................................................................... 26
Section 5.2 Administrator Appointed Attorney-in-Fact........................................................ 27
Section 5.3 Administrator May Perform....................................................................... 28
Section 5.4 Release of Collateral........................................................................... 28
ii
3
ARTICLE VI. INCREASED COSTS, ETC............................................................................... 28
Section 6.1 Increased Costs................................................................................. 28
Section 6.2 Funding Losses.................................................................................. 29
Section 6.3 Withholding Taxes............................................................................... 29
ARTICLE VII. CONDITIONS TO BORROWING............................................................................ 30
Section 7.1 Initial Loan.................................................................................... 30
7.1.1 Resolutions........................................................................... 30
7.1.2 Consents, etc......................................................................... 30
7.1.3 Incumbency and Signatures............................................................. 30
7.1.4 Good Standing Certificates............................................................ 30
7.1.5 Financing Statements.................................................................. 30
7.1.6 Search Reports........................................................................ 31
7.1.7 Fee Letter; Payment of Fees........................................................... 31
7.1.8 First Step Sale Agreement and Receivables Sale Agreement.............................. 31
7.1.9 Opinions of Counsel................................................................... 31
7.1.10 Lender Note........................................................................... 31
7.1.11 Borrowing Base Certificate............................................................ 32
7.1.12 Lock Box and Blocked Account Agreements............................................... 32
7.1.13 Releases.............................................................................. 32
7.1.14 Performance Undertaking............................................................... 32
7.1.15 Other................................................................................. 32
Section 7.2 All Loans....................................................................................... 32
7.2.1 No Default, etc....................................................................... 32
7.2.2 Borrowing Request, etc................................................................ 32
7.2.3 Commitment Termination Date........................................................... 32
7.2.4 Collateral Review..................................................................... 32
7.2.5 Accounts.............................................................................. 32
ARTICLE VIII. REPRESENTATIONS AND WARRANTIES..................................................................... 33
Section 8.1 Existence and Power............................................................................. 33
Section 8.2 Power and Authority; Due Authorization, Execution and Delivery.................................. 33
Section 8.3 No Conflict..................................................................................... 33
Section 8.4 Governmental Authorization...................................................................... 33
Section 8.5 Actions, Suits.................................................................................. 33
Section 8.6 Binding Effect.................................................................................. 34
Section 8.7 Accuracy of Information......................................................................... 34
Section 8.8 Margin Regulations; Use of Proceeds............................................................. 34
Section 8.9 Good Title...................................................................................... 34
Section 8.10 Perfection...................................................................................... 34
Section 8.11 Chief Executive Office.......................................................................... 35
Section 8.12 Accounts........................................................................................ 35
Section 8.13 No Material Adverse Effect...................................................................... 35
Section 8.14 Names........................................................................................... 35
iii
4
Section 8.15 Ownership of Borrower; No Subsidiaries......................................................... 35
Section 8.16 Not a Holding Company or an Investment Company................................................. 35
Section 8.17 Compliance with Credit and Collection Policy................................................... 35
Section 8.18 Solvency....................................................................................... 35
Section 8.19 Eligible Receivables........................................................................... 35
Section 8.20 Sales by Originator............................................................................ 36
ARTICLE IX. COVENANTS OF BORROWER AND SERVICER................................................................. 36
Section 9.1 Affirmative Covenants........................................................................... 36
9.1.1 Compliance with Laws, Etc............................................................. 36
9.1.2 Preservation of Corporate Existence................................................... 36
9.1.3 Performance and Compliance with Receivables........................................... 36
9.1.4 Credit and Collection Policy.......................................................... 36
9.1.5 Reporting Requirements................................................................ 36
(a) Financial Statements......................................................... 36
(b) Borrowing Base Certificates and Monthly Reports.............................. 37
(c) Significant Events........................................................... 37
(d) Servicing Certificate........................................................ 38
(e) Collateral Review............................................................ 38
(f) Other........................................................................ 38
9.1.6 Use of Proceeds....................................................................... 38
9.1.7 Separate Legal Entity................................................................. 38
9.1.8 Adverse Claims on Receivables......................................................... 40
9.1.9 Further Assurances.................................................................... 40
9.1.10 Servicing............................................................................. 40
9.1.11 Inspection............................................................................ 41
9.1.12 Cooperation........................................................................... 41
9.1.13 Facility.............................................................................. 41
9.1.14 Accounts.............................................................................. 41
Section 9.2 Negative Covenants.............................................................................. 42
9.2.1 Sales, Liens, Etc..................................................................... 42
9.2.2 Mergers, Acquisitions, Sales, Subsidiaries, etc....................................... 42
9.2.3 Change in Business; Change in Credit and Collection Policy............................ 42
9.2.4 Other Debt............................................................................ 43
9.2.5 Certificate of Incorporation and By-Laws.............................................. 43
9.2.6 Chief Executive Office................................................................ 43
9.2.7 Financing Statements.................................................................. 43
9.2.8 Business Restrictions................................................................. 43
9.2.9 Other Agreements; Performance Undertaking............................................. 43
ARTICLE X. SIGNIFICANT EVENTS AND THEIR EFFECT................................................................ 44
Section 10.1 Events of Default.............................................................................. 44
10.1.1 Non-Payment of Loans, Etc............................................................. 44
10.1.2 Non-Compliance with Other Provisions.................................................. 44
10.1.3 Breach of Representations and Warranties.............................................. 44
iv
5
10.1.4 Bankruptcy............................................................................ 44
10.1.5 Tax Liens............................................................................. 44
Section 10.2 Amortization Events............................................................................ 45
10.2.1 Servicer Event of Default............................................................. 45
10.2.2 Borrowing Base Deficit................................................................ 45
10.2.3 Default Ratio......................................................................... 45
10.2.4 Delinquency Ratio..................................................................... 45
10.2.5 Dilution Ratio........................................................................ 45
10.2.6 Accounts Receivable Turnover Ratio.................................................... 45
10.2.7 Event of Default...................................................................... 45
10.2.8 Validity of Transaction Documents..................................................... 45
10.2.9 Termination Date...................................................................... 45
10.2.10 Performance Undertaking................................................................ 45
Section 10.3 Effect of Significant Event.................................................................... 46
ARTICLE XI. THE SERVICER....................................................................................... 46
Section 11.1 ChoicePoint as Initial Servicer................................................................ 46
Section 11.2 Certain Duties of the Servicer................................................................. 46
11.2.1 Authorization to Act as Borrower's Agent.............................................. 46
11.2.2 Servicer to Act as Servicer; Originators as Permitted Sub-Servicers................... 47
11.2.3 Collections........................................................................... 48
11.2.4 Depository Accounts................................................................... 49
Section 11.3 Servicing Compensation......................................................................... 50
Section 11.4 Agreement Not to Resign........................................................................ 50
Section 11.5 Designation of Servicer........................................................................ 50
Section 11.6 Termination.................................................................................... 50
Section 11.7 Servicer Events of Default..................................................................... 50
11.7.1 Failure to Make Payments and Deposits................................................. 50
11.7.2 Non-Compliance with Other Provisions.................................................. 51
11.7.3 Delegation............................................................................ 51
11.7.4 Breach of Representations and Warranties.............................................. 51
11.7.5 Consolidated Tangible Net Worth....................................................... 51
11.7.6 Bankruptcy............................................................................ 51
11.7.7 Judgments............................................................................. 51
11.7.8 Cross-Default to Material Debt........................................................ 51
ARTICLE XII. ADMINISTRATOR....................................................................................... 52
Section 12.1 Authorization and Action....................................................................... 52
Section 12.2 Administrator and Affiliates................................................................... 52
ARTICLE XIII. ASSIGNMENTS........................................................................................ 52
Section 13.1 Restrictions on Assignments.................................................................... 52
Section 13.2 Documentation.................................................................................. 53
v
6
Section 13.3 Rights of Assignee............................................................................. 53
Section 13.4 Notice of Assignment........................................................................... 53
ARTICLE XIV. INDEMNIFICATION..................................................................................... 53
Section 14.1 General Indemnity of Borrower.................................................................. 53
Section 14.2 Indemnity of Servicer.......................................................................... 54
ARTICLE XV. MISCELLANEOUS...................................................................................... 54
Section 15.1 No Waiver; Remedies............................................................................ 54
Section 15.2 Amendments, Etc................................................................................ 54
Section 15.3 Notices, Etc................................................................................... 55
Section 15.4 Costs, Expenses and Taxes...................................................................... 55
Section 15.5 Binding Effect; Survival....................................................................... 55
Section 15.6 Captions and Cross References.................................................................. 56
Section 15.7 Severability................................................................................... 56
Section 15.8 Governing Law.................................................................................. 56
Section 15.9 Counterparts................................................................................... 56
Section 15.10 Submission to Jurisdiction; Waiver of Trial by Jury............................................ 56
Section 15.11 Limitation on Recourse......................................................................... 57
Section 15.12 No Proceedings................................................................................. 57
Section 15.13 Confidentiality................................................................................ 58
Section 15.14 Entire Agreement............................................................................... 58
EXHIBITS AND SCHEDULES
EXHIBIT A Form of Borrowing Request
EXHIBIT B Form of Lender Note
EXHIBIT C Form of Monthly Report
EXHIBIT D Form of Borrowing Base Certificate
EXHIBIT E Form of LockBox and Blocked Account Agreement
EXHIBIT F Form of Performance Undertaking
SCHEDULE 8.12 LockBoxes and LockBox Accounts
SCHEDULE 9.1.5 Collateral Review Requirements
SCHEDULE 15.3 Notice Addresses
vi
7
LOAN AGREEMENT
THIS LOAN AGREEMENT is made and entered into as of July 2,
2001, among CHOICEPOINT FINANCIAL INC., a Delaware corporation ("BORROWER"),
CHOICEPOINT INC., a Georgia corporation, in its capacity as the initial servicer
(in such capacity, together with its successors and permitted assigns in such
capacity, the "SERVICER"), THREE PILLARS FUNDING CORPORATION, a Delaware
corporation (together with its successors and permitted assigns, "LENDER"), and
SUNTRUST EQUITABLE SECURITIES CORPORATION, a Tennessee corporation, as agent and
administrator for Lender (in such capacity, together with its successor and
assigns in such capacity, the "ADMINISTRATOR").
BACKGROUND
1. Borrower desires that Lender extend financing to
Borrower on the terms and subject to the conditions set forth herein.
2. Lender is willing to provide such financing on the
terms and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
Section 1.1 Defined Terms. As used in this Agreement,
(a) capitalized terms used and not otherwise defined herein are used with the
meanings attributed thereto in the Receivables Sale Agreement (hereinafter
defined) or if not defined therein, in the First Step Sale Agreement
(hereinafter defined) regardless of whether those capitalized terms are listed
below, and (b) the following terms have the following meanings:
"ACCOUNTS RECEIVABLE TURNOVER RATIO" means, on any date of
determination, the ratio computed as of the most recent Calculation Date by
dividing (a) the aggregate amount of Credit Sales during the 12 months ending on
such Calculation Date by (b) the average month-end amount of the aggregate
Unpaid Balance of Receivables during the 12 months ending on such Calculation
Date.
"ADMINISTRATOR" has the meaning set forth in the preamble to
this Agreement.
"ADMINISTRATOR'S ACCOUNT" has the meaning set forth in Section
4.5.
"ADVANCE RATE" means the percentage equal to (a) 100% minus
(b) the Reserve Percentage.
"ADVERSE CLAIM" has the meaning specified in the First Step
Sale Agreement.
"AFFECTED PARTY" means each of Lender, any Liquidity Bank, any
permitted assignee of Lender or any Liquidity Bank, any Support Provider and any
holder of a participation
1
8
interest in the rights and obligations of any Liquidity Bank or Credit Bank
under the Liquidity Agreement or the Credit Agreement, as the case may be,
Administrator and any holding company of Bank.
"AFFILIATE" of any Person means any other Person that (i)
directly or indirectly controls, is controlled by or is under common control
with such Person or (ii) is an officer or director of such Person. A Person
shall be deemed to be "controlled by" another Person if such other Person
possesses, directly or indirectly, power (a) to vote 5% or more of the
securities (on a fully diluted basis) having ordinary voting power for the
election of directors or managing partners of such other Person, or (b) to
direct or cause the direction of the management and policies of such other
Person whether by contract or otherwise. The word "AFFILIATED" has a correlative
meaning.
"AGGREGATE ELIGIBLE BALANCE" means, on any date of
determination, the aggregate Unpaid Balance of all Eligible Receivables at such
time.
"AGREEMENT" means this Loan Agreement, as it may be amended,
supplemented, restated or otherwise modified from time to time in accordance
with the terms hereof.
"ALLOCATIONS" has the meaning set forth in Section 3.3.
"ALTERNATIVE RATE" means, for any Interest Period, an interest
rate per annum equal to either (a) the LIBOR Rate or (b) if the LIBOR Rate is
unavailable for any reason or there is less than two (2) Business Days' prior
notice to the Liquidity Banks of any funding by them, the Base Rate.
"ALTERNATIVE RATE ALLOCATION" has the meaning set forth in
Section 3.3.
"AMORTIZATION EVENT" means any of the events described in
Section 10.2.
"APPLICABLE MARGIN" has the meaning specified in the Fee
Letter.
"BANK" means SunTrust Bank, a Georgia banking corporation.
"BANKRUPTCY CODE" means the United States Bankruptcy Code, 11
U.S.C.ss.101, et seq., as amended.
"BASE RATE" means, on any date of determination, a fluctuating
rate of interest per annum equal to the higher of (i) the Prime Rate, or (ii)
the Federal Funds Rate most recently determined by Bank plus 0.50% per annum.
"BORROWER" has the meaning set forth in the preamble to this
Agreement.
"BORROWING BASE" means, on any date of determination, an
amount equal to the product of (a) the Advance Rate as of the most recent
Calculation Date times (b) the excess, if any, of (i) the Aggregate Eligible
Balance as of the last Business Day of the two-week period then most recently
ended over (ii) the Excess Concentration Amount for all Obligors as of the last
Business Day of the two-week period then most recently ended.
2
9
"BORROWING BASE CERTIFICATE" means a certificate,
substantially in the form of Exhibit D hereto, duly executed by an authorized
officer of Servicer.
"BORROWING BASE DEFICIT" means, on any date of determination,
an amount equal to (i) the excess, if any, of (a) the aggregate principal amount
of all outstanding Loans at such time over (b) the sum of the Borrowing Base (as
reflected in the most recent Borrowing Base Certificate) plus (ii) all
Collections on deposit in the Depository Accounts at such time.
"BORROWING REQUEST" has the meaning set forth in Section 2.2.
"BUSINESS DAY" means any day on which (a) Bank is not
authorized or required to be closed for business in Atlanta, Georgia, and The
Depository Trust Company of New York is open for business, and (b) commercial
banks in New York City are not authorized or required to be closed and, in the
case of a Rate Setting Date for Loans bearing interest by reference to the LIBOR
Rate, banks are open for business in London, England.
"CALCULATION DATE" means the last Business Day of each
Calculation Period.
"CALCULATION PERIOD" means a calendar month.
"CHARGE-OFF" means a Receivable not previously deemed a
Defaulted Receivable that is written-off by the Servicer or should, in
accordance with the Credit and Collection Policy, be written-off.
"CHOICEPOINT" means ChoicePoint Inc., a Georgia corporation.
"CLOSING DATE" means the date of the first Loan hereunder.
"COLLATERAL" has the meaning set forth in Section 5.1(a).
"COLLATERAL REVIEW" means a report of the independent
certified public accountants of ChoicePoint which satisfies the requirements set
forth on Schedule 9.1.5.
"COLLECTIONS" has the meaning set forth in the First Step Sale
Agreement.
"COMMERCIAL PAPER NOTES" means short-term promissory notes
issued by Lender to fund its Loans or investments in receivables or other
financial assets.
"COMMERCIAL PAPER RATE" means, for any Interest Period for all
or any portion of the related CP Allocation, a rate per annum equal to the sum
of (i) the rate or, if more than one rate, the weighted average of the rates,
determined by converting to an interest-bearing equivalent rate per annum the
discount rate (or rates) at which Commercial Paper Notes outstanding during such
Interest Period have been or may be sold by any placement agent or commercial
paper dealer selected by Administrator, plus (ii) the commissions and charges
charged by such placement agent or commercial paper dealer with respect to such
Commercial Paper Notes, expressed as a percentage of the face amount thereof and
converted to an interest-bearing equivalent rate per annum.
3
10
"COMMITMENT TERMINATION DATE" means the earliest to occur of
(i) the Scheduled Commitment Termination Date, (ii) the date of any termination
of the Lender's Commitment pursuant to Section 2.6, (iii) the effective date on
which the Lender's Commitment is terminated pursuant to Section 10.3, (iv) the
Liquidity Termination Date, (v) termination of the Credit Banks' commitments
under the Credit Agreement, and (vi) the date on which any purchase or other
funding is made pursuant to the Liquidity Agreement.
"CONCENTRATION LIMIT" means:
(a) for any Obligor whose short term unsecured debt
ratings are not less than both "A-1" from S&P and "P-1" from Moody's,
8.0% of the Aggregate Eligible Balance; or
(b) for any Obligor whose short term unsecured debt
ratings are not less than both "A-3" from S&P and "P-3" from Moody's
but are less than both "A-1" by S&P and "P-1" by Moody's, 5.0% of the
Aggregate Eligible Balance; or
(c) for any Obligor who does not have short term
unsecured debt ratings from both S&P and Moody's but has long term
unsecured debt ratings from both S&P and Moody's which are greater than
or equal to both "A" by S&P and "A2" by Moody's, 8.0% of the Aggregate
Eligible Balance; or
(d) for any Obligor who does not have short term
unsecured debt ratings from both S&P and Moody's but has long term
unsecured debt ratings from both S&P and Moody's which are greater than
or equal to both "BBB-" by S&P and "Baa3" by Moody's but less than both
"A" by S&P and "A2" by Moody's, 5.0% of the Aggregate Eligible Balance;
or
(e) for any Obligor who (i) does not have short term
unsecured debt ratings or long term unsecured debt ratings from both
S&P and Moody's or (ii) has such ratings but does not meet the test in
any of clauses (a)-(d) above, 3.0% of the Aggregate Eligible Balance;
PROVIDED that (1) the limitations set forth in the foregoing clauses (a)-(e)
shall apply to each specified Obligor and its Affiliates, considered as if they
were one and the same Person, and (2) in the event that any Obligor has both
long-term and short-term unsecured debt ratings from both S&P and Moody's, the
short-term debt ratings under clause (a) or (b) above, as applicable, shall
control.
"CONSOLIDATED TANGIBLE NET WORTH" means at any date, with
respect to any Person, the consolidated stockholders' equity of such Person and
its consolidated Subsidiaries, plus the principal amount of subordinated debt of
such Person, minus (to the extent reflected in determining such consolidated
stockholders' equity) all intangible assets (determined in accordance with GAAP)
as reported in the audited consolidated financial statements of such Person for
the fiscal year in question.
"CONTRACT" has the meaning set forth in the First Step Sale
Agreement.
4
11
"COVERED TAXES" means Taxes other than Excluded Taxes.
"CP ALLOCATION" has the meaning set forth in Section 3.3.
"CP TRANCHE PERIOD" means, with respect to all or any portion
of the CP Allocation, a period of days not to exceed 90 days commencing on a
Business Day which period is either (a) requested by Borrower and agreed to by
Lender (or by Administrator on Lender's behalf) or (b) in the absence of such
request and agreement, selected by Lender (or by Administrator on Lender's
behalf).
"CREDIT ADVANCE" means a drawing under a letter of credit
issued pursuant to a Credit Agreement for the account of Lender, a loan to
Lender under a Credit Agreement or any other advance or disbursement of funds to
Lender or for Lender's account pursuant to a Credit Agreement or any such letter
of credit, in each case to the extent such drawing, loan, advance or
disbursement has not been repaid or reimbursed to Credit Bank in accordance with
the related Credit Agreement.
"CREDIT AGREEMENT" means and includes any program-wide
agreement entered into by any Credit Bank providing for the issuance of one or
more letters of credit for the account of Lender, the issuance of one or more
surety bonds for which Lender is obligated to reimburse the applicable Credit
Bank for any drawings hereunder, the sale by Lender to any Credit Bank of
receivables or other financial assets owned or held by Lender (or portions
thereof) and/or the making of loans and/or other extensions of credit to Lender
in connection with its commercial paper program, together with any cash
collateral agreement, letter of credit, surety bond or other agreement or
instrument executed and delivered in connection therewith (but excluding the
Liquidity Agreement, or similar agreement, or any voluntary advance agreement).
"CREDIT AND COLLECTION POLICY" has the meaning set forth in
the First Step Sale Agreement
"CREDIT BANK" means and includes Bank and any other or
additional bank or other Person (other than Borrower or other customer of Lender
or any liquidity provider as such) now or hereafter extending credit or a
purchase commitment to or for the account of Lender or issuing a letter of
credit, surety bond or other instrument, in each case to support any obligations
arising under or in connection with Lender's commercial paper program.
"CREDIT SALES" means, for any period of determination, the
aggregate amount of all trade receivables with credit terms of any kind
originated by the Originators during such period, regardless of whether the same
have been invoiced.
"DAYS SALES OUTSTANDING RATIO" means, on any date of
determination, the ratio computed as of the most recent Calculation Date by
dividing (a) 360 by (b) the Accounts Receivable Turnover Ratio for the
Calculation Period ending on such Calculation Date.
"DEBT" of any Person means, without duplication, (i) all
indebtedness of such Person for borrowed money, (ii) all indebtedness of such
Person for the deferred purchase price of property or services (other than
property and services purchased, and expense accruals and deferred compensation
items arising, in the ordinary course of business), (iii) all obligations of
5
12
such Person evidenced by notes, bonds, debentures or other similar instruments
(other than performance, surety and appeal bonds arising in the ordinary course
of business), (iv) all indebtedness of such Person created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (v) all obligations of such Person under leases which
have been or should be, in accordance with GAAP, recorded as capital leases, to
the extent required to be so recorded, (vi) all reimbursement, payment or
similar obligations of such Person, contingent or otherwise, under acceptance,
letter of credit or similar facilities (other than letters of credit in support
of trade obligations or in connection with workers' compensation, unemployment
insurance, old-age pensions and other social security benefits in the ordinary
course of business), (vii) all net obligations of such Person in respect of
interest rate swap, cap, collar, swaption, option or similar agreements, (viii)
all obligations arising in connection with a sale or other transfer of any of
such Person's financial assets which are, or are intended to be, classified as
loans for federal tax purposes, (ix) all Debt referred to in clauses (i) through
(viii) above guaranteed directly or indirectly by such Person, or in effect
guaranteed directly or indirectly by such Person through an agreement (A) to pay
or purchase such Debt or to advance or supply funds for the payment or purchase
of such Debt, (B) to purchase, sell or lease (as lessee or lessor) property, or
to purchase or sell services, primarily for the purpose of enabling the debtor
to make payment of such Debt or to assure the holder of such Debt against loss
in respect of such Debt, (C) to supply funds to or in any other manner invest in
the debtor (including any agreement to pay for property or services irrespective
of whether such property is received or such services are rendered) or (D)
otherwise to assure a creditor against loss in respect of such Debt, and (x) all
Debt referred to in clauses (i) through (viii) above secured by (or for which
the holder of such Debt has an existing right, contingent or otherwise, to be
secured by) any lien, security interest or other charge or encumbrance upon or
in property (including, without limitation, accounts and contract rights) owned
by such Person, even though such Person has not assumed or become liable for the
payment of such Debt.
"DEFAULT RATE" has the meaning set forth in Section 3.1(c).
"DEFAULT RATIO" means, on any date of determination, the ratio
(expressed as a percentage) computed as of the most recent Calculation Date by
dividing (a) the sum (without double counting) of (i) the Unpaid Balance of
Receivables that became Defaulted Receivables during the Calculation Period
ending on such Calculation Date, plus (ii) the Unpaid Balance of Receivables
that became Charge-Offs during the Calculation Period ending on such Calculation
Date by (b) Credit Sales for the Calculation Period ending four (4) months prior
to such Calculation Date.
"DEFAULTED RECEIVABLE" means, as of any date of determination,
any Receivable (i) which the Servicer has or should have charged-off or deemed
uncollectible in accordance with the Credit and Collection Policy after taking a
reasonable time to apply Collections received to applicable invoices and
reconcile the amount of such Receivable, (ii) as to which, as of such date of
determination, any payment, or part thereof, remains unpaid for 91 days or more
past the due date for such payment, determined by reference to the original
contractual payment terms of such Receivable or (iii) as to which the Obligor
thereon has suffered an Event of Bankruptcy.
6
13
"DELINQUENCY RATIO" means, on any date of determination, the
ratio (expressed as a percentage) computed as of the most recent Calculation
Date by dividing (i) the Unpaid Balance of Receivables which are Delinquent
Receivables as of such Calculation Date by (ii) an amount equal to the Aggregate
Eligible Balance as of such Calculation Date, minus the aggregate Excess
Concentration Amount as of such Calculation Date.
"DELINQUENT RECEIVABLE" means a Receivable (other than a
Defaulted Receivable) as to which all or any part of a scheduled payment remains
unpaid for 61 days or more from the original due date for such payment.
"DEPOSIT DATE" has the meaning set forth in Section 11.2.4(b).
"DEPOSITORY ACCOUNT" means a deposit account (other than a
LockBox Account) into which Collections are deposited.
"DILUTION HORIZON RATIO" means, on any date of determination,
the ratio (expressed as a percentage) computed as of the most recent Calculation
Date by dividing (a) the sum of (i) Credit Sales for the Calculation Period
ending on such Calculation Date plus (ii) 50% of Credit Sales for the
Calculation Period ending one (1) month prior to such Calculation Date by (b) an
amount equal to the Aggregate Eligible Balance as of such Calculation Date,
minus the aggregate Excess Concentration Amount as of such Calculation Date.
"DILUTION RATIO" means, on any date of determination, the
ratio (expressed as a percentage) computed as of the most recent Calculation
Date by dividing (a) Dilutions for the Calculation Period ending on such
Calculation Date by (b) Credit Sales for the Calculation Period ending one (1)
month prior to such Calculation Date.
"DILUTION RESERVE" means, on any date of determination, the
product computed as of the most recent Calculation Date, of (a) the sum of (i)
the product of (x) the Stress Factor times (y) the Expected Dilution Ratio plus
(ii) the product of (x) the positive difference, if any, between (1) the
Dilution Spike Rate less (2) the Expected Dilution Ratio times (y) a ratio
computed by dividing (1) the Dilution Spike Rate by (2) the Expected Dilution
Ratio times (b) the Dilution Horizon Ratio.
"DILUTION SPIKE RATE" means, on any date of determination, the
highest Dilution Ratio over the 12-month period ending on the most recent
Calculation Date.
"DILUTIONS" means, for any period of determination, the
aggregate amount of returns, allowances, net credits and any other non-cash
reductions to the Credit Sales during such period.
"DISTRIBUTION DATE" means the 20th day of each month after the
Closing Date (or, if any such day is not a Business Day, the next succeeding
Business Day thereafter).
"DOCUMENTS" means all documentation relating to the
Receivables including, without limitation, the Contracts, billing statements and
computer records and programs.
7
14
"DOLLAR(S)" and the sign "$" shall mean lawful money of the
United States of America.
"ELIGIBLE ORIGINATOR" means (a) any Originator party to the
First Step Sale Agreement on the Closing Date, and (b) any Originator who
becomes a party to the First Step Sale Agreement after the Closing Date with
respect to which the Rating Agencies have received written notice of such
Originator's addition and a certificate from the Administrator regarding
perfection of Borrower's ownership interest and Administrator's security
interest in such new Originator's Receivables and Related Security; PROVIDED,
HOWEVER, that if such Originator is a Material Originator, such Originator shall
not be an Eligible Originator unless Administrator has otherwise agreed in
writing and the Rating Agency Condition has been satisfied.
"ELIGIBLE RECEIVABLE" means each Receivable that meets the
following criteria:
(a) that was created by an Eligible Originator in
compliance, in all material respects, with its Credit and Collection
Policy, in the regular and ordinary course of the business of such
Eligible Originator;
(b) that was documented in all material respects in
compliance with the applicable Eligible Originator's standard
administration and documentation policies and procedures;
(c) is not a Delinquent Receivable or a Defaulted
Receivable;
(d) as to which, at the time of the sale or contribution
of such Receivable to Parent SPE, the applicable Eligible Originator
was the sole owner thereof and had good and marketable title thereto,
free and clear of all Adverse Claims, and as to which, at the time of
the sale or contribution of such Receivable to Borrower, Parent SPE was
the sole owner thereof and had good and marketable title thereto, free
and clear of all Adverse Claims, and which was sold or contributed to
Parent SPE pursuant to the First Step Sale Agreement, and then sold or
contributed to Borrower pursuant to the Receivables Sale Agreement,
free and clear of all Adverse Claims other than in favor of
Administrator;
(e) the assignment of which by the applicable Eligible
Originator to Parent SPE pursuant to the First Step Sale Agreement and
by Parent SPE to Borrower pursuant to the Receivables Sale Agreement
does not contravene or conflict with any law, rule or regulation or any
contractual or other restriction, limitation or encumbrance, and the
sale or assignment of which does not require the consent of the Obligor
thereof;
(f) which is denominated and payable in Dollars and is
only payable in the United States of America;
(g) the Obligor of which is a resident of the United
States;
(h) the Obligor of which is not an officer, director or
Affiliate of any Originator, Parent SPE or Borrower;
8
15
(i) the Obligor of which is not a Governmental Authority;
(j) that is in full force and effect and constitutes the
legally valid and binding payment obligation of the Obligor with
respect thereto, enforceable against such Obligor in accordance with
its terms and is not subject to any right of rescission, setoff,
counterclaim or defense (including the defense of usury) or to any
repurchase obligation or return right;
(k) that does not contravene any applicable requirements
of law (including without limitation all laws, rules and regulations
relating to truth in lending, fair credit billing, fair credit
reporting, fair debt collection practices and privacy) and which
complies with all applicable requirements of law and with respect to
which all consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority required
to be obtained, effected or given by the related Eligible Originator in
connection with the creation or the execution, delivery and performance
of such Receivable, have been duly obtained, effected or given and are
in full force and effect;
(l) that complies with all applicable requirements of the
applicable Credit and Collection Policy;
(m) as to which each of Parent SPE's, Borrower's and
Administrator's (for the benefit of the Secured Parties) first priority
security interest in such Receivable has been perfected under the
applicable Uniform Commercial Code and other applicable laws;
(n) as to which the Servicer is in possession of the
related Receivable File;
(o) which is invoiced no less frequently than once per
month and has been outstanding, on any date of determination, not more
than 60 days after the creation of such invoice;
(p) the terms of which have not been modified or waived
except as permitted under the applicable Credit and Collection Policy
and this Agreement;
(q) which constitutes an "account" under and as defined
in Article 9 of the Uniform Commercial Code of all applicable
jurisdictions;
(r) which is not subject to any dispute, right of
rescission, set-off, counterclaim or any other defense (including
defenses arising out of violations of usury laws) of the applicable
Obligor against the applicable Originator or any other Adverse Claim,
and the Obligor thereon holds no right as against the applicable
Eligible Originator to cause the applicable Eligible Originator to
repurchase the goods the sale of which shall have given rise to such
Receivable (except with respect to sale discounts effected pursuant to
the Contract, or goods returned in accordance with the terms of the
Contract); and
9
16
(s) the applicable Eligible Originator has satisfied and
fully performed all obligations on its part with respect to such
Receivable required to be fulfilled by it, and no further action is
required to be performed by any Person with respect thereto other than
payment thereon by the applicable Obligor.
"EVENT OF BANKRUPTCY" shall be deemed to have occurred with
respect to a Person if either:
(a) a case or other proceeding shall be commenced,
without the application or consent of such Person, in any court,
seeking the liquidation, reorganization, debt arrangement, dissolution,
winding up, or composition or readjustment of debts of such Person, the
appointment of a trustee, receiver, custodian, liquidator, assignee,
sequestrator or the like for such Person or all or substantially all of
its assets, or any similar action with respect to such Person under any
law relating to bankruptcy, insolvency, reorganization, winding up or
composition or adjustment of debts; or an order for relief in respect
of such Person shall be entered in an involuntary case under the
Bankruptcy Code or other similar laws now or hereafter in effect; or
(b) such Person shall commence a voluntary case or other
proceeding under any applicable bankruptcy, insolvency, reorganization,
debt arrangement, dissolution or other similar law now or hereafter in
effect, or shall consent to the appointment of or taking possession by
a receiver, liquidator, assignee, trustee, custodian, sequestrator (or
other similar official) for such Person or for any substantial part of
its property, or shall make any general assignment for the benefit of
creditors, or shall fail to, or admit in writing its inability to, pay
its debts generally as they become due, or, if a corporation or similar
entity, its board of directors shall vote to implement any of the
foregoing.
"EVENT OF DEFAULT" means any of the events described in
Section 10.1.
"EXCESS CONCENTRATION AMOUNT" means, on any date of
determination, with respect to any Obligor and its Affiliates considered as if
they were one and the same Obligor, the amount, if any, by which the Aggregate
Eligible Balance of such Obligor and its Affiliates at such time exceeds the
Concentration Limit for such Obligor and its Affiliates at such time.
"EXCLUDED TAXES" means, in the case of any Indemnified Party,
taxes imposed on its overall net income, and franchise taxes and branch profit
taxes based on net income, imposed on it by (i) the jurisdiction under the laws
of which such Indemnified Party is incorporated or organized or (ii) the
jurisdiction in which such Indemnified Party's principal executive office is
located.
"EXECUTIVE OFFICER" means, as to any Person, such Person's
chief executive office, president, chief financial officer, chief legal officer,
treasurer, assistant treasurer, and any individual holding comparable offices or
duties.
10
17
"EXPECTED DILUTION RATIO" means, on any date of determination,
the rolling twelve-month average Dilution Ratio for the 12-month period ending
on the most recent Calculation Date.
"FACILITY LIMIT" means $100,000,000 (as such amount may be
reduced from time to time in accordance with Section 2.6).
"FEDERAL FUNDS RATE" means, for any period, the per annum rate
set forth in the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Board (including any
such successor, "H.15(519)") for such day opposite the caption "Federal Funds
(Effective)." If on any relevant day such rate is not yet published in
H.15(519), the rate for such day will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publications, published by the Federal
Reserve Bank of Atlanta (including any such successor, the "COMPOSITE 3:30 P.M.
QUOTATIONS") for such day under the caption "Federal Funds Effective Rate." If
on any relevant day the appropriate rate for such previous day is not yet
published in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate
for such day will be the arithmetic mean as determined by Bank of the rates for
the last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New
York time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by Bank.
"FEE LETTER" has the meaning set forth in Section 3.4.
"FEES" means all fees and other amounts payable by Borrower to
Administrator or Lender pursuant to the Fee Letter.
"FIRST STEP NOTE" has the meaning set forth in the Receivables
Sale Agreement.
"FIRST STEP SALE AGREEMENT" has the meaning set forth in the
Receivables Sale Agreement.
"GAAP" has the meaning set forth in the First Step Sale
Agreement.
"GOVERNMENTAL AUTHORITY" has the meaning set forth in the
First Step Sale Agreement.
"INDEMNIFIED AMOUNTS" has the meaning set forth in Section
14.1.
"INDEMNIFIED PARTY" has the meaning set forth in Section 14.1.
"INTEREST PERIOD" means:
(a) with respect to any CP Allocation, its CP Tranche
Period;
(b) with respect to any Alternative Rate Allocation, (i)
initially, the period commencing on the date of the initial
establishment of such Allocation and ending on (but excluding) the
Business Day immediately preceding the next following Scheduled
Interest Payment Date, and (ii) thereafter, each period
11
18
commencing on (and including) the Business Day immediately preceding a
Scheduled Interest Payment Date and ending on (but excluding) the
Business Day immediately preceding the next following Scheduled
Interest Payment Date;
PROVIDED, HOWEVER, that if any Interest Period for any Allocation that commences
before the Commitment Termination Date would otherwise end on a date occurring
after such Commitment Termination Date, such Interest Period shall end on such
Commitment Termination Date and the duration of each such Interest Period that
commences on or after the Commitment Termination Date, if any, shall be of such
duration as shall be selected by Administrator.
"LENDER" has the meaning set forth in the preamble to this
Agreement.
"LENDER NOTE" has the meaning set forth in Section 2.7.
"LENDER'S COMMITMENT" has the meaning set forth in Section
2.1.
"LIABILITIES" means, with respect to any Person, all
obligations of such Person which would, in accordance with GAAP, be classified
on a balance sheet as liabilities, including, without limitation, (i) Debt
secured by liens against property of such Person whether or not such Person is
liable for the payment thereof and (ii) deferred liabilities.
"LIBOR RATE" means, for any Interest Period, the rate per
annum on the Rate Setting Day of such Interest Period shown on page 3750 of
Telerate or any successor page as the composite offered rate for London
interbank deposits for one month, as shown under the heading "USD" as of 11:00
a.m. (London time); PROVIDED that in the event no such rate is shown, the LIBOR
Rate shall be the rate per annum (rounded upwards, if necessary, to the nearest
1/16th of one percent) based on the rates at which Dollar deposits for one month
are displayed on page "LIBOR" of the Reuters Screen as of 11:00 a.m. (London
time) on the Rate Setting Day (it being understood that if at least two (2) such
rates appear on such page, the rate will be the arithmetic mean of such
displayed rates); PROVIDED FURTHER, that in the event fewer than two (2) such
rates are displayed, or if no such rate is relevant, the LIBOR Rate shall be the
rate per annum equal to the average of the rates at which deposits in Dollars
are offered by Administrator at approximately 11:00 a.m. (London time) on the
Rate Setting Day to prime banks in the London interbank market for a one month.
"LIQUIDITY AGREEMENT" means and includes (a) the Liquidity
Asset Purchase Agreement (regarding ChoicePoint Financial Inc.), dated as of
July 2, 2001, among Lender, as borrower, Bank, as liquidity agent for the
Liquidity Banks, Administrator, and the Liquidity Banks, or (b) any other
agreement hereafter entered into by Lender providing for the sale by Lender of
Loans (or portions thereof), or the making of loans or other extensions of
credit to Lender secured by security interests in the Loans (or portions
thereof), to support all or part of Lender's payment obligations under the
Commercial Paper Notes or to provide an alternate means of funding Lender's
investments in accounts receivable or other financial assets, in each case as
amended, supplemented, restated or otherwise modified from time to time.
"LIQUIDITY BANK" means and includes Bank and the various
financial institutions as are, or may become, parties to the Liquidity
Agreement, as purchasers thereunder.
12
19
"LIQUIDITY TERMINATION DATE" means the earlier to occur of (a)
July 1, 2002, as such date may be extended from time to time by the Liquidity
Banks in accordance with the Liquidity Agreement, and (b) the occurrence of an
Event of Bankruptcy with respect to Lender.
"LOAN" means any amount disbursed as principal by Lender to
Borrower under this Agreement.
"LOCKBOX" means a postal box maintained on behalf of Borrower
or the Servicer for the purpose of receiving checks and money orders
constituting Collections of the Receivables.
"LOCKBOX ACCOUNT" means any of those bank accounts described
on Schedule 8.12 hereto and any additional or replacement account to which Mail
Payments are deposited for clearing.
"LOCKBOX AND BLOCKED ACCOUNT AGREEMENT" means an agreement
among an Originator and/or Servicer, Borrower, Administrator and the bank
holding any LockBox Account, in substantially the form of Exhibit E attached
hereto.
"LOSS HORIZON RATIO" means, on any date of determination, the
ratio computed as of the most recent Calculation Date by dividing (a) the sum of
(i) Credit Sales for the Calculation Period ending on such Calculation Date,
plus (ii) Credit Sales for the Calculation Period ending one (1) month prior to
such Calculation Date, plus (iii) Credit Sales for the Calculation Period ending
two (2) months prior to such Calculation Date, plus (iv) 50% of Credit Sales for
the Calculation Period ending three (3) months prior to such Calculation Date,
by (b) an amount equal to the Aggregate Eligible Balance as of such Calculation
Date, minus the aggregate Excess Concentration Amount as of such Calculation
Date.
"LOSS RESERVE" means, on any date of determination, the
product of (i) the highest rolling 3-month average Default Ratio over the 12
months ending on the most recent Calculation Date, times (ii) the Loss Horizon
Ratio as of such Calculation Date, times (iii) the Stress Factor.
"MAIL PAYMENTS" has the meaning specified in Section
11.2.3(a).
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) on the business, property, condition (financial or otherwise) or results of
operations of (i) Servicer and its Subsidiaries taken as a whole, or (ii)
Borrower, (b) the ability of Borrower, Servicer or Performance Guarantor to
perform its respective obligations under the Agreement or any other Transaction
Document to which it is a party, (c) the legality, validity or enforceability of
the Agreement or any other Transaction Document, (d) the existence, validity,
perfection or priority of (i) Administrator's (for the benefit of the Secured
Parties) security interest in the Collateral, or (ii) Borrower's ownership
interest in the Receivables, or (e) the validity, enforceability or
collectibility of the Receivables generally or of any material portion of the
Receivables.
"MATERIAL DEBT" has the meaning specified in Section 11.7.8.
13
20
"MATERIAL ORIGINATOR" means any Subsidiary of ChoicePoint that
becomes an Originator under the First Step Sale Agreement after the Closing Date
whose Receivables represent more than 10% of the aggregate Unpaid Balance of all
Receivables immediately prior to such Subsidiary's addition as an Originator.
"MONTHLY REPORT" means a report, substantially in the form of
Exhibit C or in such other form acceptable to Administrator, prepared by
Servicer as of the Calculation Date then most recently occurring signed by an
authorized officer of Servicer.
"MOODY'S" means Moody's Investors Service, Inc.
"NET WORTH" with respect to the Borrower has the meaning
specified in the Receivables Sale Agreement.
"OBLIGATIONS" means all obligations (monetary or otherwise) of
Borrower to Lender, Administrator, any Affected Party or any Indemnified Party
and their respective successors, permitted transferees and assigns arising under
or in connection with this Agreement, the Lender Note and each other Transaction
Document, in each case however created, arising or evidenced, whether direct or
indirect, absolute or contingent, now or hereafter existing, or due or to become
due.
"OBLIGOR" means, with respect to any Receivable, each Person
obligated to make payments with respect to such Receivable, including any
guarantor thereof.
"ORIGINATOR" means (a) ChoicePoint Services Inc., a Georgia
corporation, PRC Corporation, a Georgia corporation, ChoicePoint Business and
Government Services Inc., a Georgia corporation, ChoicePoint Direct Inc., an
Illinois corporation, Statewide Data Services, Inc., a Florida corporation,
I.R.S.C., Inc., a California corporation, ChoicePoint Public Records Inc., a
Georgia corporation, Patlex Corporation, a Pennsylvania corporation, National
Safety Alliance Incorporated, a Tennessee corporation, and BTi Employee
Screening Services Inc., a Texas corporation , in its capacity as a seller under
the First Step Sale Agreement, and (b) any Subsidiary of ChoicePoint that
hereafter becomes a seller under the First Step Sale Agreement.
"OUTSTANDING BALANCE" has the meaning specified in the First
Step Sale Agreement.
"PARENT SPE" means ChoicePoint Capital Inc., a Delaware
corporation, and its successors.
"PERFORMANCE GUARANTOR" means ChoicePoint.
"PERFORMANCE UNDERTAKING" means a Performance Undertaking in
the form of Exhibit F hereto, duly executed by the Performance Guarantor in
favor of the Borrower.
"PERMITTED INVESTMENT" means, at any time:
(i) marketable obligations issued by, or the full and
timely payment of which is directly and fully guaranteed or insured by,
the United States
14
21
government or any other government with an equivalent rating, or any
agency or instrumentality thereof when such marketable obligations are
backed by the full faith and credit of the United States government or
such other equivalently rated government, as the case may be, but
excluding any securities which are derivatives of such obligations;
(ii) time deposits, bankers' acceptances and certificates
of deposit of any domestic commercial bank or any United States branch
or agency of a foreign commercial bank which (x) has capital, surplus
and undivided profits in excess of $100,000,000 and which has a
commercial paper or certificate of deposit rating meeting the
requirements specified in clause (iii) below (or equivalent rating from
the Rating Agencies) or (y) is set forth in a list (which may be
updated from time to time) (A) approved by Administrator and (B) with
respect to which a written statement has been obtained from each of the
Rating Agencies to the effect that the rating of the Commercial Paper
Notes will not be downgraded or withdrawn solely as a result of the
acquisition of such investments;
(iii) commercial paper which is (x) rated at least as high
as the Commercial Paper Notes by the Rating Agencies, or (y) set forth
in a list (which may be updated from time to time) (A) approved by
Administrator and (B) with respect to which a written statement has
been obtained from each of the Rating Agencies to the effect that the
rating of the Commercial Paper Notes will not be downgraded or
withdrawn solely as a result of the acquisition of such investments;
(iv) secured repurchase obligations for underlying
securities of the types described in clauses (i) and (ii) above entered
into with any bank of the type described in clause (ii) above; and
(v) freely redeemable shares in money market funds which
invest solely in obligations, bankers' acceptances, time deposits,
certificates of deposit, repurchase agreements and commercial paper of
the types described in clauses(i) through (iv) above, without regard to
the limitations as to the maturity of such obligations, bankers'
acceptances, time deposits, certificates of deposit, repurchase
agreements or commercial paper set forth below, which are rated at
least "AAm" or "AAmg" or their equivalent by at least one Rating
Agency, PROVIDED that there is no "r-highlighter" affixed to such
rating.
"PERSON" has the meaning set forth in the First Step Sale
Agreement
"PRIME RATE" means as of any date of determination, the rate
of interest most recently announced by Bank at its principal office in Atlanta,
Georgia as its prime rate (it being understood that at any one time there shall
exist only one such prime rate so announced, which rate is not necessarily
intended to be the lowest rate of interest determined by Bank in connection with
extensions of credit).
15
22
"PROGRAM DOCUMENTS" means the Liquidity Agreement, the Credit
Agreement, the Voluntary Advance Agreement, the documents under which
Administrator performs its obligations with respect to Lender's commercial paper
program and the other documents to be executed and delivered in connection
therewith, as amended, supplemented, restated or otherwise modified from time to
time.
"PURCHASE PRICE CREDIT" means any "PURCHASE PRICE CREDIT" as
defined in the First Step Sale Agreement or the Receivables Sale Agreement
"RATE SETTING DAY" means, for any Interest Period, two (2)
Business Days prior to the commencement of such Interest Period. In the event
such day is not a Business Day, then the Rate Setting Day shall be the
immediately preceding Business Day.
"RATING AGENCIES" means S&P and Moody's.
"RATING AGENCY CONDITION" means that Lender has received
written notice from each of the Rating Agencies that an amendment, a change or a
waiver will not result in a withdrawal or downgrade of the then current ratings
on Lender's Commercial Paper Notes.
"RECEIVABLE" has the meaning specified in the Receivables Sale
Agreement.
"RECEIVABLE FILE" means with respect to a Receivable, (i) the
Contract giving rise to the Receivable and other evidences of the Receivable
including, without limitation, tapes, discs, punch cards and related property
and rights and (ii) each UCC financing statement related thereto, if any.
"RECEIVABLES SALE AGREEMENT" means the Receivables Sale
Agreement, dated as of July 2, 2001, by and between Parent SPE, as seller, and
Borrower, as purchaser, as such Receivables Sale Agreement may be amended,
supplemented, restated or otherwise modified from time to time with the prior
written consent of Administrator.
"REGULATORY CHANGE" means, relative to any Affected Party:
(a) any change in (or the adoption, implementation,
change in the phase-in or commencement of effectiveness of) any: (i)
United States Federal or state law or foreign law applicable to such
Affected Party, (ii) regulation, interpretation, directive, requirement
or request (whether or not having the force of law) applicable to such
Affected Party of (A) any court or government authority charged with
the interpretation or administration of any law referred to in clause
(a)(i), or of (B) any fiscal, monetary or other authority having
jurisdiction over such Affected Party, or (iii) GAAP or regulatory
accounting principles applicable to such Affected Party and affecting
the application to such Affected Party of any law, regulation,
interpretation, directive, requirement or request referred to in clause
(a)(i) or (a)(ii) above;
(b) any change in the application to such Affected Party
of any existing law, regulation, interpretation, directive,
requirement, request or accounting principles referred to in clause
(a)(i), (a)(ii) or (a)(iii) above; or
16
23
(c) the issuance, publication or release of any
regulation, interpretation, directive, requirement or request of a type
described in clause (a)(ii) above to the effect that the obligations of
any Liquidity Bank under the Liquidity Agreement are not entitled to be
included in the zero percent category of off-balance sheet assets for
purposes of any risk-weighted capital guidelines applicable to such
Liquidity Bank or any related Affected Party.
"RELATED SECURITY" has the meaning specified in the
Receivables Sale and Contribution Agreement.
"REQUIRED CAPITAL AMOUNT" has the meaning specified in the
Receivables Sale Agreement.
"REQUIREMENTS OF LAW" for any Person or any of its property
shall mean the certificate of incorporation or articles of association and
by-laws or other organizational or governing documents of such Person or any of
its property, and any statute, law, treaty, rule or regulation, or determination
of an arbitrator or Governmental Authority, in each case applicable to or
binding upon such Person or any of its property or businesses or to which such
Person or any of its property or businesses is subject, whether federal, state
or local.
"RESERVE FLOOR" means for any Calculation Period, 19%.
"RESERVE PERCENTAGE" means the percentage equal to the greater
of (a) the sum of (i) the Loss Reserve, (ii) the Dilution Reserve, (iii) the
Yield Reserve, and (iv) the Servicing Reserve and (b) the Reserve Floor.
"S&P" means Standard & Poor's Ratings Group, a division of The
McGraw-Hill Companies, Inc.
"SCHEDULED COMMITMENT TERMINATION DATE" means July 1, 2002, as
extended from time to time by mutual agreement of the parties hereto.
"SCHEDULED INTEREST PAYMENT DATE" means each Distribution Date
hereafter commencing with July 20, 2001.
"SECURED OBLIGATIONS" has the meaning set forth in Section
5.1(b).
"SECURED PARTIES" means Lender, Administrator and each
Indemnified Party, and the successors and permitted assigns of each of the
foregoing.
"SERVICER" means ChoicePoint, or any successor Servicer
appointed as provided in Section 11.5.
"SERVICER EVENT OF DEFAULT" shall have the meaning specified
in Section 11.7.
"SERVICING FEE" means, for each day in a Calculation Period,
an amount equal to (i) the Servicing Fee Rate (or, at any time while ChoicePoint
Inc. or one of its Affiliates is the Servicer, such lesser percentage as may be
agreed between Borrower and the Servicer on an
17
24
arms' length basis based on then prevailing market terms for similar services),
TIMES (ii) the aggregate Outstanding Balance of all Receivables as of the close
of business on the cut-Off Date immediately preceding such Calculation Period,
TIMES (iii) 1/360. The Servicing Fee for any successor Servicer that is not an
Affiliate of ChoicePoint Inc. shall be equal to the fee reasonably agreed to by
Administrator and such successor Servicer but in no event shall such fee exceed
110% of such successor Servicer's actual costs of servicing the Receivables.
"SERVICING FEE RATE" means 2.40%.
"SERVICING RESERVE" means, on any date of determination, the
product of: (a) the highest Day Sales Outstanding Ratio during the 12 months
ending on the most recent Calculation Date, (b) the Stress Factor, (c) the
Servicing Fee Rate, and (d) 1/360.
"SIGNIFICANT EVENT" means any Amortization Event or Event of
Default.
"SOLVENT" means with respect to any Person that as of the date
of determination both (A)(i) the then fair saleable value of the property of
such Person is (y) greater than the total amount of liabilities (including
contingent liabilities) of such Person and (z) not less than the amount that
will be required to pay the probable liabilities on such Person's then existing
debts as they become absolute and matured considering all financing alternatives
and potential asset sales reasonably available to such Person; (ii) such
Person's capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
"solvent" within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.
"STRESS FACTOR" means 2.0.
"SUBORDINATED NOTE" has the meaning specified in the
Receivables Sale Agreement.
"SUBSIDIARY" means, with respect to any Person, a corporation
of which such Person and/or its other Subsidiaries own, directly or indirectly,
such number of outstanding shares as have more than 50% of the ordinary voting
power for the election of directors.
"SUPPORT PROVIDER" means and includes any entity now or
hereafter extending credit or liquidity support or having a commitment to extend
credit or liquidity support to or for the account of, or to make loans to or
purchases from, Lender or issuing a letter of credit, surety bond or other
instrument to support any obligations arising under or in connection with the
commercial paper program of Lender.
"TAXES" means any and all present or future taxes, duties,
levies, imposts, deductions, charges or withholdings, and any and all
liabilities (including but not limited to interest and penalties) with respect
to the foregoing, imposed by any Governmental Authority.
18
25
"TELERATE PAGE 3750" shall mean the display designated as
"Page 3750" on the Telerate Service (or such other page as may replace "Page
3750" on that service or another service as may be nominated by the British
Bankers' Association as the information vendor for the purpose of displaying
British Bankers' Association Interest Settlement Rate for Dollars).
"TRANSACTION DOCUMENTS" means this Agreement, the Receivables
Sale Agreement, the First Step Sale Agreement, the Lender Note, the Fee Letter,
the Subordinated Note, the First Step Notes, the Performance Undertaking, and
the other instruments, certificates, agreements, reports and documents to be
executed and delivered under or in connection with this Agreement or the
Receivables Sale Agreement (except the Program Documents), as any of the
foregoing may be amended, supplemented, amended and restated, or otherwise
modified from time to time in accordance with this Agreement.
"UCC" means the Uniform Commercial Code as from time to time
in effect in the applicable jurisdiction or jurisdictions.
"UNMATURED SERVICER EVENT OF DEFAULT" means any event that, if
it continues uncured, will, with lapse of time or notice or lapse of time and
notice, constitute a Servicer Event of Default.
"UNMATURED SIGNIFICANT EVENT" means any event that, if it
continues uncured, will, with lapse of time or notice or lapse of time and
notice, constitute a Significant Event.
"UNPAID BALANCE" means, with respect to any Receivable, the
sum of (a) the Outstanding Balance thereof, plus (without duplication), (b) the
aggregate amount required to repay in full all interest, finance, prepayment and
other fees or charges of any kind payable in respect of, such Outstanding
Balance.
"VOLUNTARY ADVANCE AGREEMENT" means the Voluntary Advance
Agreement, dated as of March 11, 1999, among Lender, Administrator and Bank, as
it may be amended, supplemented, restated or otherwise modified from time to
time.
"YIELD RESERVE" means, on any date of determination, the
product of (a) the highest Day Sales Outstanding Ratio during the 12 months
ending on the most recent Calculation Date, (b) the Stress Factor, (c) the Prime
Rate as in effect on such Calculation Date and (d) 1/360.
Section 1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined
in this Agreement have the meanings as so defined herein when used in
the Lender Note or any other Transaction Document, certificate, report
or other document made or delivered pursuant hereto.
(b) Each term defined in the singular form in Section 1.1
or elsewhere in this Agreement shall mean the plural thereof when the
plural form of such term is used in this Agreement, the Lender Note or
any other Transaction Document, certificate, report or other document
made or delivered pursuant hereto, and each term defined in the plural
19
26
form in Section 1.1 shall mean the singular thereof when the singular
form of such term is used herein or therein.
(c) The words "HEREOF," "HEREIN," "HEREUNDER" and similar
terms when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and
article, section, subsection, schedule and exhibit references herein
are references to articles, sections, subsections, schedules and
exhibits to this Agreement unless otherwise specified.
Section 1.3 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 and not specifically defined herein, are used
herein as defined in such Article 9.
Section 1.4 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" and the words "TO" and "UNTIL" each means "TO BUT EXCLUDING."
ARTICLE II.
THE LENDER'S COMMITMENT, BORROWING PROCEDURES AND LENDER NOTE
Section 2.1 Lender's Commitment. On the terms and
subject to the conditions set forth in this Agreement, Lender agrees to make
loans to Borrower on a revolving basis from time to time (the "LENDER'S
COMMITMENT") before the Commitment Termination Date in such amounts as may be
from time to time requested by Borrower pursuant to Section 2.2; PROVIDED,
HOWEVER, that the aggregate principal amount of all Loans from time to time
outstanding hereunder shall not exceed the lesser of (a) the Facility Limit and
(b) the Borrowing Base. Within the limits of the Lender's Commitment, Borrower
may borrow and (subject to Section 4.1(a)) prepay and reborrow under this
Section 2.1.
Section 2.2 Borrowing Procedures. Borrower (or the
Servicer on its behalf) may request a Loan hereunder by giving notice to
Administrator of a proposed borrowing not later than 2:00 p.m. (New York City
time), two (2) Business Days prior to the proposed date of such borrowing (or
such lesser period of time as Lender may consent); PROVIDED that Borrower shall
not request, and Lender shall not make, Loans more than once per calendar week.
Each such notice (herein called a "BORROWING REQUEST") shall be in the form of
Exhibit A (or, if acceptable to Administrator, the information required therein
may be given by telephone) and shall include the date and amount of such
proposed borrowing. Any Borrowing Request given by Borrower (or the Servicer on
its behalf) pursuant to this Section 2.2 shall be irrevocable and binding on
Borrower.
Section 2.3 Funding. Subject to the satisfaction of the
conditions precedent set forth in Article VII with respect to such Loan and the
limitations set forth in Section 2.1, Lender shall make the proceeds of such
requested Loan available to Administrator at its office in Atlanta, Georgia in
immediately available funds on the proposed date of borrowing. Upon
20
27
receipt by Administrator of such funds, Administrator will make such funds
available to Borrower at such office on such date. Each borrowing shall be on a
Business Day and shall be in an amount of at least $1,000,000 and in integral
multiples of $500,000 (or in such other amounts as Lender or Administrator may
approve).
Section 2.4 Representation and Warranty. Each request
for a borrowing pursuant to Section 2.2 shall automatically constitute a
representation and warranty by Borrower to Administrator and Lender that on the
requested date of such borrowing (a) the representations and warranties
contained in Article VIII will be true and correct as of such requested date as
though made on such date, (b) no Significant Event or Unmatured Significant
Event has occurred and is continuing or will result from such borrowing, and (c)
after giving effect to such requested borrowing, the aggregate principal balance
of the outstanding Loans hereunder will not exceed the lesser of the Borrowing
Base and the Facility Limit.
Section 2.5 Extension of Lender's Commitment. The
Lender's Commitment shall terminate on the Commitment Termination Date.
Notwithstanding the foregoing:
(a) Lender or Administrator, on Lender's behalf, shall
use reasonable effort to give Borrower not less than 60 days' prior
notice of any scheduled termination of the Credit Banks' commitments
under the Credit Agreement and shall promptly notify Borrower of any
extension thereof,
(b) Not more than 90 days prior to the Liquidity
Termination Date in effect from time to time, Borrower may request that
Lender or Administrator, on Lender's behalf, seek the Liquidity Banks'
consent to extend the Liquidity Termination Date for a period which,
when aggregated with the number of days remaining until the existing
Liquidity Termination Date would not cause the Liquidity Banks'
commitments under the Liquidity Agreement as so extended to exceed 364
days in toto, and
(c) Not more than 90 days prior to the Scheduled
Commitment Termination Date in effect from time to time, Borrower may
request that Lender consent to extend the Scheduled Commitment
Termination Date for an additional 364-day period.
Administrator shall advise Borrower in writing whether each request made
pursuant to the foregoing clause (b) or clause (c) has been granted within
thirty (30) days after such request has been made and whether such consent is
subject to satisfaction of any conditions precedent. If any such request is not
granted within thirty (30) days after such request has been made, the Liquidity
Termination Date or Scheduled Commitment Termination Date, as the case may be,
shall remain unchanged. If any such request is granted within thirty (30) days
after such request has been made, the Liquidity Termination Date or Scheduled
Commitment Termination Date, as the case may be, shall be extended as provided
in Administrator's written notice upon satisfaction of any conditions precedent
specified therein.
Section 2.6 Voluntary Termination of Lender's
Commitment; Reduction of Facility Limit. Borrower may, in its sole discretion
for any reason upon at least 10 days'
21
28
notice to Administrator (with a copy to Lender), terminate the Lender's
Commitment in whole, or, reduce in part the unused portion of the Facility
Limit; PROVIDED, HOWEVER that (a) each such partial reduction will be in a
minimum amount of $5,000,000 or a higher integral multiple of $1,000,000 and
shall not reduce the Facility Limit below $40,000,000, and (b) in connection
therewith Borrower shall comply with Section 3.2(b) and Section 4.1(b).
Section 2.7 Note. Each Loan from Lender shall be
evidenced by a single promissory grid note (herein, as amended, modified,
extended or replaced from time to time, called the "LENDER NOTE") substantially
in the form set forth in Exhibit B, with appropriate insertions, payable to the
order of Lender. Borrower hereby irrevocably authorizes Administrator in
connection with the Lender Note to make (or cause to be made) appropriate
notations on the grid attached to the Lender Note (or on any continuation of
such grid, or at Administrator's option, in its records), which notations, if
made, shall evidence, inter alia, the date of, the outstanding principal of, and
the interest rate and Interest Period applicable to the Loans evidenced thereby.
Such notations shall be rebuttably presumptive evidence of the subject matter
thereof, absent manifest error; PROVIDED, HOWEVER, that the failure to make any
such notations shall not limit or otherwise affect any Obligations of Borrower.
ARTICLE III.
INTEREST, FEES, ETC.
Section 3.1 Interest Rates. Borrower hereby promises to
pay interest on the unpaid principal amount of each Loan (or each portion
thereof) for the period commencing on the date of such Loan until such Loan is
paid in full, as follows:
(a) at all times while the making or maintenance of such
Loan (or the applicable portion thereof) by Lender is funded by the
issuance of Commercial Paper Notes of Lender, during each Interest
Period, at a rate per annum equal to the sum of (i) the Commercial
Paper Rate applicable to such Interest Period, plus (ii) the Applicable
Margin;
(b) at all times while the making or maintenance of such
Loan (or the applicable portion thereof) by Lender is funded during
each Interest Period pursuant to the Liquidity Agreement or the
Voluntary Advance Agreement, at a rate per annum equal to the sum of
(i) the Alternative Rate applicable to such Interest Period, plus (ii)
the Applicable Margin; and
(c) notwithstanding the provisions of the preceding
clauses (a) and (b), in the event that a Significant Event or an
Unmatured Significant Event has occurred and is continuing, at a rate
per annum (the "DEFAULT RATE") equal to the Base Rate applicable from
time to time (but not less than the interest rate in effect for such
Loan as at the date of such Significant Event), plus a margin of 2.00%.
After the date any principal amount of any Loan is due and payable
(whether on the Scheduled Commitment Termination Date, upon
acceleration or otherwise) or after any other monetary Obligation of
Borrower arising under this Agreement shall become due and payable,
Borrower shall pay (to the extent permitted by law, if in respect of
any unpaid amounts representing interest) interest (after as well as
22
29
before judgment) on such amounts at a rate per annum equal to the
Default Rate. No provision of this Agreement or the Lender Note shall
require the payment or permit the collection of interest in excess of
the maximum permitted by applicable law.
Section 3.2 Interest Payment Dates. Interest accrued on
each Allocation shall be payable, without duplication:
(a) on each Scheduled Interest Payment Date prior to the
Scheduled Commitment Termination Date, for the period since the
creation of such Allocation (in the case of the first Scheduled
Interest Payment Date thereafter) or since the prior Scheduled Interest
Payment Date (in the case of any subsequent Scheduled Interest Payment
Date);
(b) on the date of any payment or prepayment (in whole or
in part) of principal outstanding in such Allocation, on the amount
paid or prepaid (it being understood that any prepayment shall be
accompanied by any amounts owing under Section 6.2);
(c) in full, on the Scheduled Commitment Termination Date
(whether at scheduled maturity or upon acceleration thereof pursuant to
Section 10.3); and
(d) from and after the Scheduled Commitment Termination
Date, upon demand.
Section 3.3 Interest Allocations. Administrator shall
from time to time and in its sole discretion determine whether interest in
respect of the Loans then outstanding, or any portion thereof, shall be
calculated by reference to the Commercial Paper Rate (such portion being herein
called a "CP ALLOCATION") or an Alternative Rate (such portion being herein
called an "ALTERNATIVE RATE ALLOCATION", and together with a CP Allocation
individually called an "ALLOCATION", and collectively, "ALLOCATIONS"); PROVIDED,
HOWEVER, that, Administrator shall use its reasonable efforts to allocate all or
substantially all of the Loans from Lender to a CP Allocation (it being
understood that if Lender is not able to issue sufficient Commercial Paper Notes
to fund all of its assets at such time and no Significant Event or Unmatured
Significant Event has occurred and is continuing, Lender and Administrator
shall, at least, fund the Loans pro rata with its other non-defaulted assets
with Commercial Paper Notes); PROVIDED FURTHER, HOWEVER, that Administrator may
determine, at any time and in its sole discretion, that the Commercial Paper
Rate is unavailable or otherwise not desirable, in which case the Loans from
Lender will be allocated to an Alternative Rate Allocation (unless the Default
Rate is in effect).
Section 3.4 Fees. Borrower agrees to pay (or cause to be
paid to) Administrator and Lender certain Fees in the amounts and on the dates
set forth in the letter agreement executed in connection herewith between
Borrower and Administrator (as the same may be amended, supplemented, restated
or otherwise modified, the "FEE LETTER").
Section 3.5 Computation of Interest and Fees. All
interest, Fees and Servicing Fees shall be computed on the basis of the actual
number of days (including the first day but
23
30
excluding the last day) occurring during the period for which such interest or
Fee is payable over a year comprised of 360 days.
ARTICLE IV.
REPAYMENTS AND PREPAYMENTS; DISTRIBUTION OF COLLECTIONS
Section 4.1 Repayments and Prepayments. Borrower shall
repay in full the unpaid principal amount of each Loan on the Scheduled
Commitment Termination Date. Prior thereto, Borrower:
(a) may, from time to time on any Business Day, make a
prepayment, in whole or in part, of the outstanding principal amount of
any Loans; PROVIDED, HOWEVER, that, (i) unless otherwise consented to
by Administrator, all such voluntary prepayments shall require at least
two (2) Business Days' (or, in the case of a voluntary prepayment of
$10,000,000 or more, at least seven (7) Business Days') prior written
notice to Administrator, (ii) unless otherwise consented to by
Administrator, all such voluntary partial prepayments shall be in a
minimum amount of $1,000,000 and an integral multiple of $100,000, and
(iii) unless and until the aggregate outstanding principal balance of
the Loans hereunder is less than 10% of the highest amount ever
borrowed hereunder, no such prepayment may be made with any funds other
than (A) Collections and (B) the Borrower's initial paid-in cash
capital (if any then remains);
(b) shall, on each date when any reduction in the
Facility Limit shall become effective pursuant to Section 2.6, make a
prepayment of the Loans in an amount equal to the excess, if any, of
the aggregate outstanding principal amount of the Loans over the
Facility Limit as so reduced;
(c) shall, immediately upon any acceleration of the
Scheduled Commitment Termination Date of any Loans pursuant to Section
10.3, repay all Loans, unless, pursuant to Section 10.3(a), only a
portion of all Loans is so accelerated, in which event Borrower shall
repay the accelerated portion of the Loans; and
(d) shall, immediately upon discovering that a Borrowing
Base Deficit exists, make a prepayment of the Loans in an amount equal
to such Borrowing Base Deficit. Each such prepayment shall be subject
to the payment of any amounts required by Section 6.2.
Section 4.2 Application of Collections.
(a) All Collections shall be distributed by the Servicer
at such times and in the order of priority set forth in this Section 4.2.
(b) On each Distribution Date, prior to payment in full
of all Secured Obligations, the Servicer shall distribute from Collections on
deposit in the Depository Accounts on such Distribution Date, if any, the
following amounts, without duplication in the following order of priority:
24
31
FIRST, to the extent due and owing under this Agreement or any
other Transaction Document, the accrued Servicing Fee payable for the
prior Calculation Period (plus, if applicable, the amount of Servicing
Fee payable for any prior Calculation Period to the extent such amount
has not been distributed to Servicer);
SECOND, interest accrued on the Loans during the period from
the most recent Distribution Date to the current Distribution Date
(plus, if applicable, the amount of interest on the Loans accrued for
any prior period to the extent such amount has not been paid, and to
the extent permitted by law, interest thereon);
THIRD, to the extent due and owing under any Transaction
Document, all Fees accrued during the prior Calculation Period (plus,
if applicable, the amount of Fees accrued for any prior Calculation
Period to the extent such amount has not been distributed to Lender or
Administrator);
FOURTH, as a repayment of principal of the Loans, an amount
equal to the Borrowing Base Deficit, if any;
FIFTH, to the extent due and owing under any Transaction
Document on such Distribution Date, all other Secured Obligations owed
to any Secured Party;
SIXTH, to the extent due and owing under this Agreement or any
other Transaction Document on such Distribution Date, all other
obligations then payable by Borrower to Administrator or Lender; and
SEVENTH, the balance, if any, to Borrower.
(c) On and after the Commitment Termination Date and the
payment in full of all Secured Obligations, the Servicer shall distribute from
Collections on deposit in the Depository Accounts on such Distribution Date, if
any, the following amounts, without duplication in the following order of
priority:
FIRST, the accrued but unpaid Servicing Fee due and owing on
such Distribution Date;
SECOND, all other obligations payable by Borrower under this
Agreement due and owing on such Distribution Date; and
THIRD, once all amounts described in clauses FIRST and SECOND
above have been paid in full, the balance, if any, to Borrower.
Section 4.3 Application of Certain Payments. Each
payment of principal of the Loans shall be applied to such Loans as Borrower
shall direct or, in the absence of such notice or during the existence of a
Significant Event or after the Commitment Termination Date, as Administrator
shall determine in its discretion.
25
32
Section 4.4 Due Date Extension. If any payment of
principal or interest with respect to any Loan falls due on a day which is not a
Business Day, then such due date shall be extended to the next following
Business Day, and additional interest shall accrue at the applicable interest
rate and be payable for the period of such extension.
Section 4.5 Making of Payments. All payments of
principal of, or interest on, the Loans and of all Fees, and all amounts to be
deposited by Borrower or Servicer hereunder, shall be made by Borrower or
Servicer, as applicable, no later than 12:00 noon (New York City time), on the
day when due in lawful money of the United States of America in immediately
available funds to Bank, as Administrator, Reference: Three Pillars Funding
Corporation/ChoicePoint Financial Inc., a Delaware corporation, Transaction,
Account No. 880171236, ABA No. 061000104, at Bank's office at 25 Park Place, in
Atlanta, Georgia, Attn: Mary Hinsberg (the "ADMINISTRATOR'S ACCOUNT"). Funds
received by Administrator after 12:00 noon (New York City time), on the date
when due, will be deemed to have been received by Administrator on its next
following Business Day.
ARTICLE V.
SECURITY INTEREST
Section 5.1 Grant of Security.
(a) Borrower hereby assigns and pledges to Administrator
(for the benefit of the Secured Parties), and hereby grants to Administrator
(for the benefit of the Secured Parties) a security interest in all of
Borrower's right, title and interest in and to the following, whether now or
hereafter existing and wherever located:
(i) all Receivables, Related Security and Receivable
Files;
(ii) all of Borrower's rights, remedies, powers and
privileges in respect of the Receivables Sale Agreement, including,
without limitation, its rights to receive Purchase Price Credits and
indemnity payments thereunder;
(iii) all of Borrower's rights, remedies, powers and
privileges in respect of the Performance Undertaking, including,
without limitation, its right to demand performance thereunder;
(iv) the LockBox Accounts and the Depository Accounts and
all funds on deposit therein, together with all certificates and
instruments, if any, from time to time evidencing such accounts and
funds on deposit; and
(v) all products and proceeds (including, without
limitation, insurance proceeds) of, and additions, improvements and
accessions to, and books and records describing or used in connection
with, all and any of the property described above;
(items (i) through (v) are collectively referred to as the "COLLATERAL").
26
33
(b) This grant of security secures the payment and
performance of all Obligations of Borrower now or hereafter existing or arising
under, or in connection with, this Loan Agreement, the Lender Note and each
other Transaction Document, whether for principal, interest, costs, Fees,
Indemnified Amounts, expenses or otherwise (all such Obligations of Borrower
being called the "SECURED OBLIGATIONS").
(c) This grant of security shall create a continuing
security interest in the Collateral and shall:
(i) remain in full force and effect until Administrator's
(for the benefit of the Secured Parties) interest in the Collateral
shall have been released in accordance with Section 5.4;
(ii) be binding upon Borrower, its successors, transferees
and assigns; and
(iii) inure, together with the rights and remedies of
Administrator (for the benefit of the Secured Parties) hereunder, to
the benefit of Administrator and each Secured Party and their
respective successors, transferees and assigns.
Section 5.2 Administrator Appointed Attorney-in-Fact.
Borrower hereby irrevocably appoints Administrator (for the benefit of the
Secured Parties) as Borrower's attorney-in-fact, with full authority in the
place and stead of Borrower and in the name of Borrower or otherwise, from time
to time in Administrator's discretion, after the occurrence and during the
continuation of a Significant Event to take any action and to execute any
instrument which Administrator may deem necessary or advisable to accomplish the
purposes of the Transaction Documents, including, without limitation:
(a) to ask, demand, collect, sue for, recover,
compromise, receive and give acquittance and receipts for moneys due
and to become due under or in respect of any of the Collateral;
(b) to receive, endorse, and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (a)
above;
(c) to file any claims or take any action or institute
any proceedings which Administrator may deem necessary or desirable for
the collection of any of the Collateral or otherwise to enforce the
rights of Administrator (for the benefit of the Secured Parties) with
respect to any of the Collateral;
(d) to sell, transfer, assign or otherwise deal in or
with the Collateral or any part thereof pursuant to the terms and
conditions hereunder; and
(e) to perform the affirmative obligations of Borrower
under the Transaction Documents. Administrator agrees to give Borrower
and Servicer written notice of the taking of any such action, but the
failure to give such notice shall not affect the rights, power or
authority of Administrator with respect thereto. Borrower hereby
acknowledges, consents and agrees that the power of
27
34
attorney granted pursuant to this Section 5.2 is irrevocable and
coupled with an interest.
Section 5.3 Administrator May Perform. If Borrower fails
to perform any agreement contained herein, Administrator (for the benefit of the
Secured Parties) may itself perform, or cause performance of such agreement, and
the expenses of Administrator incurred in connection therewith shall be payable
by Borrower.
Section 5.4 Release of Collateral. Administrator's (for
the benefit of the Secured Parties) right, title and interest in the Collateral
shall be released effective on the date occurring after the Commitment
Termination Date on which all Secured Obligations shall have been finally and
fully paid and performed.
ARTICLE VI.
INCREASED COSTS, ETC.
Section 6.1 Increased Costs. If any change in Regulation
D of the Board of Governors of the Federal Reserve System, or any Regulatory
Change, in each case occurring after the date hereof:
(a) shall subject any Affected Party to any tax, duty or
other charge with respect to any Loan made or funded by it, or shall
change the basis of taxation of payments to such Affected Party of the
principal of or interest on any Loan owed to or funded by it or any
other amounts due under this Agreement in respect of any Loan made or
funded by it (except for changes in the rate of tax on the overall net
income of such Affected Party imposed by the jurisdiction in which such
Affected Party's principal executive office is located); or
(b) shall impose, modify or deem applicable any reserve
(including, without limitation, any reserve imposed by the Board of
Governors of the Federal Reserve System, but excluding any reserve
included in the determination of interest rates pursuant to Section
3.1), special deposit or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any
Affected Party;
(c) shall change the amount of capital maintained or
required or requested or directed to be maintained by any Affected
Party; or
(d) shall impose on any Affected Party any other
condition affecting any Loan made or funded by any Affected Party;
and the result of any of the foregoing is or would be to (i) increase the cost
to or to impose a cost on (I) an Affected Party funding or making or maintaining
any Loan (including extensions of credit under the Liquidity Agreement, the
Voluntary Advance Agreement or any Credit Advance, or any commitment of such
Affected Party with respect to any of the foregoing), or (II) Administrator for
continuing its or Borrower's relationship with Lender, (ii) to reduce the amount
of any sum received or receivable by an Affected Party under this Agreement, the
Lender Note, the Liquidity Agreement, the Voluntary Advance Agreement or the
Credit Agreement with respect thereto, or (iii) in the good faith determination
of such Affected Party, to reduce the rate of return on the capital of an
Affected Party as a consequence of its obligations hereunder, or under the
Liquidity Agreement, the Voluntary Advance Agreement or Credit
28
35
Agreement, or arising in connection herewith or therewith to a level below that
which such Affected Party could otherwise have achieved, then after demand by
such Affected Party to Borrower (which demand shall be accompanied by a written
statement setting forth the basis of such demand), Borrower shall pay such
Affected Party such additional amount or amounts as will (in the reasonable
determination of such Affected Party) compensate such Affected Party for such
increased cost or such reduction. Such written statement (which shall include
calculations in reasonable detail) shall, in the absence of manifest error, be
rebuttably presumptive evidence of the subject matter thereof.
Section 6.2 Funding Losses. Borrower hereby agrees that
upon demand by any Affected Party (which demand shall be accompanied by a
statement setting forth the basis for the calculations of the amount being
claimed), Borrower will indemnify such Affected Party against any net loss or
expense which such Affected Party may sustain or incur (including, without
limitation, any net loss or expense (not including lost profits) incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by
such Affected Party to fund or maintain any Allocation made by Lender to
Borrower), as reasonably determined by such Affected Party, as a result of (a)
any payment or prepayment (including any mandatory prepayment) of any Allocation
on a date other than the last day of the Interest Period for such Allocation, or
(b) any failure of Borrower to borrow any Loan on a date specified therefor in a
related Borrowing Request. Such written statement shall, in the absence of
manifest error, be rebuttably presumptive evidence of the subject matter
thereof.
Section 6.3 Withholding Taxes.
(a) All payments made by Borrower hereunder (or by
Servicer, on behalf of Borrower, hereunder) shall be made free and clear of, and
without reduction or withholding for or on account of, any present or future
Covered Taxes, now or hereafter imposed, levied, collected, withheld or assessed
by any Governmental Authority or other taxing authority. If any Covered Taxes
are required to be withheld from any amounts payable to Administrator or Lender,
the amounts so payable to Administrator or Lender shall be increased to the
extent necessary to yield to Administrator or Lender (after payment of all such
Covered Taxes) all such amounts payable hereunder at the rates or in the amounts
specified herein. Whenever any Covered Taxes are payable by Borrower, as
promptly as possible thereafter, Borrower shall send to Administrator for its
own account or for the account of Lender, as the case may be, a certified copy
of an original official receipt received by Borrower showing payment thereof. If
Borrower fails to pay any Covered Taxes when due to the appropriate taxing
authority or fails to remit to Administrator the required documentary evidence,
Borrower shall indemnify Administrator and Lender for such Covered Taxes and any
incremental taxes that may become payable by Administrator or Lender as a result
of any such failure.
(b) At least five (5) Business Days prior to the first
date on which any payments, including discount or Fees, are payable hereunder
for the account of Lender, if Lender is not incorporated under the laws of the
United States, Lender agrees to deliver to each of Borrower and Administrator
two (2) duly completed copies of (i) United States Internal Revenue Service
29
36
Form W-8BEN or W-8ECI (or successor applicable form) certifying that such Lender
is entitled to receive payments hereunder without deduction or withholding of
any United States federal income taxes or (ii) United States Internal Revenue
Service Form W-8 or W-9 (or successor applicable form) to establish an exemption
from United States backup withholding tax. Lender shall replace or update such
forms as is necessary or appropriate to maintain any applicable exemption or as
is requested by Administrator or Borrower. If Lender does not deliver the forms
described in this Section 6.3(b), Borrower or Administrator shall withhold
United States federal income taxes from any payments made hereunder at the
statutory rate applicable to payments made to Lender. Lender agrees to indemnify
and hold Borrower and Administrator harmless for any United States federal
income taxes, penalties, interest and other costs and losses incurred or payable
by Borrower or Administrator as a result of either (x) Lender's failure to
submit any form required to be provided pursuant to this Section 6.3(b) or (y)
Borrower's or Administrator's reliance on any form that Lender has provided
pursuant to this Section 6.3(b).
ARTICLE VII.
CONDITIONS TO BORROWING
Section 7.1 Initial Loan. The obligation of Lender to
make the initial Loan hereunder is subject to the conditions precedent that
Administrator shall have received all of the following, each duly executed and
dated the date of such Loan (or such earlier date as shall be satisfactory to
Administrator), in form and substance satisfactory to Administrator:
7.1.1 Resolutions. Certified copies of resolutions
of the Board of Directors of Borrower, Servicer, Performance Guarantor,
Parent SPE and each Originator authorizing or ratifying the execution,
delivery and performance, respectively, of the Transaction Documents to
which it is a party, together with a certified copy of its Organization
Documents.
7.1.2 Consents, etc. Certified copies of all
documents evidencing any necessary corporate action, consents and
governmental approvals (if any) with respect to the Transaction
Documents.
7.1.3 Incumbency and Signatures. A certificate of
the Secretary or an Assistant Secretary of Borrower, Servicer,
Performance Guarantor, Parent SPE and each Originator certifying the
names of its officer or officers authorized to sign the Transaction
Documents to which it is a party.
7.1.4 Good Standing Certificates. Good standing
certificates for Borrower, Servicer, Performance Guarantor, Parent SPE
and each Originator issued as of a recent date acceptable to
Administrator by the Secretary of State of the jurisdiction of such
Person's incorporation or organization.
7.1.5 Financing Statements. (i) Acknowledgment
copies of proper financing statements (Form UCC-1), filed on or prior
to the date of the initial Loan, naming Borrower as debtor and
Administrator (for the benefit
30
37
of the Secured Parties) as the secured party as may be necessary or, in
the opinion of Administrator, desirable under the UCC to perfect
Administrator's (for the benefit of the Secured Parties) security
interest in the Collateral, (ii) acknowledgment copies of proper
financing statements, filed on or prior to the date of the initial
Loan, naming Parent SPE as seller/debtor, Borrower as purchaser/secured
party and Administrator as assignee as may be necessary or, in the
opinion of Administrator, desirable under the UCC to perfect Parent
SPE's ownership interest in the Receivables, (iii) acknowledgment
copies of proper financing statements (Form UCC-3), filed on or prior
to the date of the initial Loan, naming each Originator as
seller/debtor, Parent SPE as purchaser/secured party and Borrower as
assignee, as may be necessary or, in the opinion of Administrator,
desirable under the UCC to perfect Borrower's ownership interest in the
Receivables, (iv) acknowledgment copies of proper financing statement
assignments with respect to each of the financing statements described
in clause (iii) above, filed on or prior to the date of the initial
Loan, naming Administrator as assignee, and (v) executed copies of
proper Uniform Commercial Code Form UCC-3 termination statements, if
any, necessary to release all liens and other Adverse Claims of any
Person in the Collateral granted by Borrower, Parent SPE or Originator.
7.1.6 Search Reports. A written search report
provided to Administrator by a search service acceptable to
Administrator listing all effective financing statements that name
Borrower, Parent SPE or any Originator as debtor or assignor and that
are filed in the jurisdictions in which filings were made pursuant to
Section 7.1.5 above and in such other jurisdictions that Administrator
shall reasonably request, together with copies of such financing
statements (none of which shall cover any Collateral or interests
therein or proceeds of any thereof), and tax and judgment lien search
reports from a Person satisfactory to Administrator showing no evidence
of such lien filed against Borrower or Originator.
7.1.7 Fee Letter; Payment of Fees. The Fee Letter,
together with all outstanding Fees payable pursuant to the Fee Letter.
7.1.8 First Step Sale Agreement and Receivables
Sale Agreement. (i) Duly executed and delivered counterparts of each of
the Receivables Sale Agreement, the First Step Sale Agreement and all
documents, agreements and instruments contemplated thereby, and (ii)
evidence that each of the conditions precedent to the execution and
delivery of each of the First Step Sale Agreement and the Receivables
Sale Agreement has been satisfied to Administrator's satisfaction, and
that the initial assignments and transfers under the First Step Sale
Agreement and the Receivables Sale Agreement have been consummated.
7.1.9 Opinions of Counsel. Opinions of counsel to
Borrower, Servicer, Performance Guarantor, Parent SPE and Originators
in form and substance satisfactory to Administrator.
7.1.10 Lender Note. The Lender Note, duly executed
by Borrower.
31
38
7.1.11 Borrowing Base Certificate. A Borrowing Base
Certificate, duly executed by an officer of Servicer on Borrower's
behalf showing a calculation of the Borrowing Base as of the date of
such initial Loan.
7.1.12 Lock Box and Blocked Account Agreements. The
Lock Box and Blocked Account Agreements, duly executed by all of the
parties thereto.
7.1.13 Releases. Releases and termination
statements duly executed by each Person, other than Borrower, that has
an interest in the Receivables.
7.1.14 Performance Undertaking. The Performance
Undertaking, duly executed by the Performance Guarantor.
7.1.15 Other. Such other documents, certificates
and opinions as Administrator may request.
Section 7.2 All Loans. The making of each Loan,
including without limitation, the initial Loan, is subject to the conditions
precedent that:
7.2.1 No Default, etc. (i) No Significant Event,
Unmatured Significant Event or Servicer Event of Default has occurred
and is continuing or will result from the making of such Loan, (ii) the
representations and warranties of Borrower contained in Article VIII
are true and correct in all material respects as of the date of such
requested Loan, with the same effect as though made on the date of such
Loan except for such representations and warranties that expressly
refer to a different date; PROVIDED THAT the materiality threshold in
the preceding clause shall not be applicable with respect to any
representation or warranty which itself contains a materiality
threshold, and (iii) after giving effect to such Loan, the aggregate
unpaid balance of the Loans will not exceed the Borrowing Base or the
Facility Limit. By making a Borrowing Request, Borrower shall be deemed
to have represented and warranted that items (i), (ii) and (iii) in the
preceding sentence are true and correct.
7.2.2 Borrowing Request, etc. Administrator shall
have received a Borrowing Request for such Loan in accordance with
Section 2.2, together with all items required to be delivered in
connection therewith.
7.2.3 Commitment Termination Date. The Commitment
Termination Date shall not have occurred.
7.2.4 Collateral Review. Administrator shall have
received the most-recent Collateral Review pursuant to Section
9.1.5(c).
7.2.5 Accounts. The Depository Accounts and the
LockBox Accounts shall have been established and shall be subject to
valid and perfected first priority security interests in favor of
Administrator for the benefit of the Secured Parties.
32
39
ARTICLE VIII.
REPRESENTATIONS AND WARRANTIES
In order to induce Lender and Administrator to enter into this
Agreement and, in the case of Lender, to make Loans hereunder, Borrower hereby
represents and warrants to Administrator and Lender as to itself as follows, and
Servicer hereby represents and warrants to Administrator and Lender as to itself
as follows:
Section 8.1 Existence and Power. Servicer is a
corporation duly organized under the laws of the State of Georgia. Borrower is a
corporation duly organized under the laws of the State of Delaware. Each of
Servicer and Borrower is validly existing and in good standing under the laws of
its state of incorporation and is duly qualified to do business and is in good
standing as a foreign corporation, and has and holds all corporate power and all
governmental licenses, authorizations, consents and approvals required to carry
on its business in each jurisdiction in which its business is conducted except
where the failure to so qualify or so hold could not reasonably be expected to
have a Material Adverse Effect.
Section 8.2 Power and Authority; Due Authorization,
Execution and Delivery. The execution and delivery by each of Servicer and
Borrower of this Agreement and each other Transaction Document to which it is a
party, and the performance of its obligations hereunder and thereunder, and
Borrower's use of the proceeds of the Loans made hereunder, are within its
corporate powers and authority and have been duly authorized by all necessary
corporate action on its part. This Agreement and each other Transaction Document
to which Servicer or Borrower is a party has been duly executed and delivered by
Servicer or Borrower, as the case may be.
Section 8.3 No Conflict. The execution and delivery by
each of Borrower and Servicer of this Agreement and each other Transaction
Document to which it is a party, and the performance of its obligations
hereunder and thereunder do not contravene or violate (i) its Organizational
Documents, (ii) any law, rule or regulation applicable to it, (iii) any
restrictions under any agreement, contract or instrument to which it is a party
or by which it or any of its property is bound, or (iv) any order, writ,
judgment, award, injunction or decree binding on or affecting it or its
property, and do not result in the creation or imposition of any Adverse Claim
on its assets (except as created under the Transaction Documents) except, in any
case described in clauses (i)-(iv) inclusive, where such contravention or
violation could not reasonably be expected to have a Material Adverse Effect;
and no transaction contemplated hereby requires compliance with any bulk sales
act or similar law.
Section 8.4 Governmental Authorization. Other than the
filing of the financing statements required hereunder, no authorization or
approval or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required for the due execution and delivery by
Servicer or Borrower of this Agreement and each other Transaction Document to
which it is a party and the performance of its obligations hereunder and
thereunder.
Section 8.5 Actions, Suits. Except as disclosed in the
SEC Filings, there is no litigation, arbitration, governmental investigation,
proceeding or inquiry pending or, to the knowledge of any of their officers,
threatened against or affecting Borrower, Servicer or any of
33
40
Servicer's Subsidiaries which could reasonably be expected to have a Material
Adverse Effect or which seeks to prevent, enjoin or delay the making or
repayment of any Loans. Other than any liability incident to any litigation,
arbitration or proceeding which could not reasonably be expected to have a
Material Adverse Effect, Servicer and its Subsidiaries have no material
contingent obligations not provided for or disclosed in the SEC Filings.
Section 8.6 Binding Effect. This Agreement and each
other Transaction Document to which Servicer or Borrower is a party constitute
the legal, valid and binding obligations of Servicer or Borrower, as the case
may be, enforceable against it in accordance with their respective terms, except
as such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or limiting creditors' rights
generally and by general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law).
Section 8.7 Accuracy of Information. All written
information heretofore furnished by Borrower, Servicer or any of their
respective Affiliates for purposes of or in connection with this Agreement, any
of the other Transaction Documents or any transaction contemplated hereby or
thereby is, and all such written information hereafter furnished by Borrower,
Servicer or any of their respective Affiliates will be, true and accurate in
every material respect on the date such information is stated or certified and
does not and will not contain any material misstatement of fact or omit to state
a material fact or any fact necessary to make the statements contained therein,
taken as a whole, not misleading.
Section 8.8 Margin Regulations; Use of Proceeds.
Borrower is not engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock, and no proceeds of any Loans, directly or
indirectly, will be used for a purpose that violates, or would be inconsistent
with, Regulations T, U and X promulgated by the Federal Reserve Board from time
to time. No portion of the proceeds of any Loan hereunder will be used for a
purpose that violates, or would be inconsistent with, any other law, rule or
regulation applicable to Borrower.
Section 8.9 Good Title. Borrower (i) is the legal and
beneficial owner of the Receivables and (ii) is the legal and beneficial owner
of the Related Security with respect thereto or possesses a valid and perfected
security interest therein, in each case, free and clear of any Adverse Claim,
except as created by the Transaction Documents. There have been duly filed all
financing statements or other similar instruments or documents necessary under
the UCC (or any comparable law) of all appropriate jurisdictions to perfect
Borrower's ownership interest in each such Receivable, its Collections and the
Related Security except for Excluded Items.
Section 8.10 Perfection. This Agreement is effective to
create a valid security interest in the Collateral favor of Administrator, for
the benefit of the Secured Parties. There have been duly filed all financing
statements or other similar instruments or documents necessary under the UCC (or
any comparable law) of all appropriate jurisdictions to perfect Administrator's
security interest, for the benefit of the Secured Parties, in the Collateral
(except for Excluded Items). The Collateral is free of any Adverse Claim except
as created under the Transaction Documents.
34
41
Section 8.11 Chief Executive Office. The chief executive
office of Borrower is located in the State of Delaware (or at such other
location, notified to Administrator in a jurisdiction where all action required
to perfect or maintain the perfection of Administrator's security interest in
the Collateral has been taken). Borrower's Federal Employer Identification
Number is 58-2630504.
Section 8.12 Accounts. Borrower represents and warrants
that (a) Schedule 8.12 hereto is a complete and accurate listing, as of the
Closing Date, of the LockBoxes, LockBox Accounts and Depository Accounts, and
(b) each of the LockBox Accounts and Depository Accounts has been established
in, or transferred into, Borrower's name. Neither Servicer nor Borrower has
granted any interest in any LockBox, any LockBox Account or any Depository
Account to any Person other than Administrator, and Administrator has exclusive
control of the LockBox Accounts and the Depository Accounts.
Section 8.13 No Material Adverse Effect. Since December
31, 2000, no event has occurred that could reasonable be expected to have a
Material Adverse Effect.
Section 8.14 Names. The name in which Borrower has
executed this Agreement is identical to the name of Borrower as indicated on the
public record of the State of Delaware. Borrower has not used any corporate
name, trade name or assumed name other than the name in which it has executed
this Agreement.
Section 8.15 Ownership of Borrower; No Subsidiaries. All
of the issued and outstanding equity interests of Borrower are owned
beneficially and of record by Parent SPE, free and clear of any Adverse Claim.
Such equity interests are validly issued, fully paid and nonassessable, and
there are no options, warrants or other rights to acquire securities of
Borrower. Borrower has no Subsidiaries.
Section 8.16 Not a Holding Company or an Investment
Company. Neither Borrower nor Servicer is a "holding company" or a "subsidiary
holding company" of a "holding company" within the meaning of the Public Utility
Holding Company Act of 1935, as amended, or any successor statute. Neither
Borrower nor Servicer is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or any successor statute.
Section 8.17 Compliance with Credit and Collection
Policy. Each of Borrower and Servicer has complied in all material respects with
the Credit and Collection Policy with regard to each Receivable and the related
Contract, and has not made any change to such Credit and Collection Policy,
except such material change as to which Administrator has given its prior
written consent.
Section 8.18 Solvency. Both before and after giving
effect to each Loan, Borrower is Solvent.
Section 8.19 Eligible Receivables. Each Receivable
included in the Borrowing Base as an Eligible Receivable as of the date of (a)
any Borrowing Base Certificate, (c) any Monthly Report or (c) the making of any
Loan, is an Eligible Receivable on such date.
35
42
Section 8.20 Sales by Originator. Each sale of
Receivables by Originator to Borrower shall have been effected under, and in
accordance with the terms of, the Receivables Sale Agreement, including the
payment by Borrower to Originator of an amount equal to the purchase price
therefor as described in the Receivables Sale Agreement, and each such sale
shall have been made for "reasonably equivalent value" (as such term is used
under ss.548 of the Bankruptcy Code) and not for or on account of "antecedent
debt" (as such term is used under ss.547 of the Bankruptcy Code) owed by
Borrower to Originator.
ARTICLE IX.
COVENANTS OF BORROWER AND SERVICER
Section 9.1 Affirmative Covenants. From the date hereof
until the first day, following the Commitment Termination Date, on which all
Obligations shall have been finally and fully paid and performed, each of
Borrower and Servicer hereby covenants and agrees with Lender and Administrator
that as to itself, as follows:
9.1.1 Compliance with Laws, Etc. Each of Borrower
and Servicer will comply in all material respects with all applicable
laws, rules, regulations and orders of all governmental authorities
(including those which relate to the Receivables).
9.1.2 Preservation of Corporate Existence. Each of
Borrower and Servicer will preserve and maintain its existence rights,
franchises and privileges in the jurisdiction of its incorporation or
organization, and qualify and remain qualified in good standing as a
foreign entity in the jurisdiction where its principal place of
business and its chief executive office are located and in each other
jurisdiction where the failure to preserve and maintain such existence,
rights, franchises, privileges and qualifications would have a Material
Adverse Effect.
9.1.3 Performance and Compliance with Receivables.
Each of Borrower and Servicer will timely and fully perform and comply
with all provisions, covenants and other promises required to be
observed by it under the Receivables and all other agreements related
to such Receivables.
9.1.4 Credit and Collection Policy. Each of
Borrower and Servicer will comply in all material respects with the
Credit and Collection Policy.
9.1.5 Reporting Requirements. Each of Borrower and
Servicer will furnish to Administrator and Lender:
(a) Financial Statements.
(i) as soon as available, and in any event within 95 days
after the end of each year, a copy of the balance sheet of Borrower, in
each case, as at the end of such year, together with the related
statement of earnings for such year, certified by the chief executive
officer, chief financial officer or controller of Borrower
36
43
(which certification shall state that such balance sheet and statement
or earnings fairly present the financial condition and results of
operations for such year in accordance with GAAP except for the absence
of footnotes), together with a certificate of such officer stating that
such officer has obtained no knowledge that a Significant Event or
Unmatured Significant Event has occurred and is continuing, or if, in
the opinion of such officer, such a Significant Event or Unmatured
Significant Event has occurred and is continuing, a statement as to the
nature thereof;
(ii) as soon as available and in any event within 95 days
after the end of each year, the financial statements and certificate of
ChoicePoint required to be delivered under Section 4.1(a)(i) of the
Receivables Sale Agreement; and
(iii) as soon as available and in any event within 50 days
after the end of each fiscal quarter the financial statements of
ChoicePoint required to be delivered under Section 4.1(a)(ii) of the
Receivables Sale Agreement, certified by the Chief Executive Officer or
a Financial Officer of Choice Point, Inc. (which certification shall
state that such balance sheets and statements fairly present the
financial condition and results of operations for such fiscal quarter,
subject to year-end audit adjustments) (it being understood that
delivery of ChoicePoint's Form 10-Q filed with the Securities and
Exchange Commission for such fiscal quarter will satisfy the foregoing
requirement), delivery of which financial statements shall be
accompanied by a certificate of such officer to the effect that no
Significant Event or Unmatured Significant Event has occurred and is
continuing.
(b) Borrowing Base Certificates and
Monthly Reports.
(i) On or before the 6th Business Day and 20th calendar
day of each month after the Closing Date (or if the 20th of any month
is not a Business Day, the Business Day immediately thereafter),
Servicer shall prepare and deliver to Administrator and Lender a
Borrowing Base Certificate as of the last Business Day of the
semi-monthly period then most recently ended, signed by an authorized
officer of Servicer; and
(ii) On or before the 20th day of each month after the Closing
Date (or, if such day is not a Business Day, the Business Day
immediately thereafter), Servicer shall prepare and deliver to
Administrator and Lender a Monthly Report as of the last day of the
month then most recently ended, signed by an authorized officer of
Servicer.
(c) Significant Events. As soon as
possible but in any event within one (1) Business Day after any
Executive Officer of Borrower or Servicer becomes aware of the
occurrence of a Significant Event or an Unmatured Significant Event,
Borrower or Servicer, as the case may be, will deliver to Administrator
and Lender an Executive Officer's certificate of Borrower setting
37
44
forth details of such event and the action that Borrower or Servicer,
as the case may be, proposes to take with respect thereto.
(d) Servicing Certificate. Servicer
shall deliver, or cause to be delivered, to Administrator, on or before
the date that is 95 days after the end of each year, an officer's
certificate signed by the president, chief executive officer or any
vice president of Servicer, dated as of the last day of the preceding
year, stating that (a) a review of the activities of Servicer during
the preceding 12-month period and of its performance under this
Agreement has been made under such officer's supervision and (b) to the
best of such officer's knowledge, based on such review, Servicer has
fulfilled its obligations under the Agreement throughout such year and
has complied in all material respects with the Credit and Collection
Policy, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the
nature and status thereof.
(e) Collateral Review. As soon as
possible, and in any event within sixty (60) days after the Closing
Date, and after each semi-annual period thereafter, a report of the
independent certified public accountants of ChoicePoint (each such
report, a "COLLATERAL REVIEW") which satisfies the requirements set
forth on Schedule 9.1.5.
(f) Other. Promptly, from time to time,
such other information, documents, records or reports respecting the
Collateral, the Receivables or the condition or operations, financial
or otherwise, of Borrower or Originator as Administrator may from time
to time reasonably request in order to protect the interests of
Administrator or Lender under or as contemplated by this Agreement or
the other Transaction Documents.
9.1.6 Use of Proceeds. Borrower will use the
proceeds of the Loans made hereunder solely in connection with the
acquisition or funding of Receivables or the repayment of amounts owed
under the Subordinated Note in connection therewith.
9.1.7 Separate Legal Entity. Borrower hereby
acknowledges that Lender and Administrator are entering into the
transactions contemplated by this Agreement and the other Transaction
Documents in reliance upon Borrower's identity as a legal entity
separate from any other Person. Therefore, from and after the date
hereof, Borrower shall take all reasonable steps to continue Borrower's
identity as a separate legal entity and to make it apparent to third
Persons that Borrower is an entity with assets and liabilities distinct
from those of any other Person, and is not a division of any other
Person. Without limiting the generality of the foregoing and in
addition to and consistent with the covenant set forth in Section
9.1.2, Borrower shall take such actions as shall be required in order
that:
38
45
(a) Borrower will be a limited purpose
corporation whose primary activities are restricted in its certificate
of incorporation to owning financial assets and financing the
acquisition thereof and conducting such other activities as it deems
necessary or appropriate to carry out its primary activities;
(b) Not less than one member of
Borrower's Board of Directors (each, an "INDEPENDENT DIRECTOR") shall
be an individual who is not, and during the past five (5) years has not
been, a director, officer, employee or 5% beneficial owner of the
outstanding common stock of any Person or entity beneficially owning
any outstanding shares of common stock of ChoicePoint or any Affiliate
thereof; PROVIDED, HOWEVER, that an individual shall not be deemed to
be ineligible to be an Independent Director solely because such
individual serves or has served in the capacity of an "independent
director" or similar capacity for special purpose entities formed by
ChoicePoint or any of its Affiliates. The certificate of incorporation
of Borrower shall provide that (i) the Board of Directors shall not
approve, or take any other action to cause the filing of, a voluntary
bankruptcy petition with respect to Borrower unless the Independent
Directors shall approve the taking of such action in writing prior to
the taking of such action, and (ii) such provision cannot be amended
without the prior written consent of the Independent Directors;
(c) Any employee, consultant or agent
of Borrower will be compensated from funds of Borrower, as appropriate,
for services provided to Borrower;
(d) Borrower will allocate and charge
fairly and reasonably overhead expenses shared with any other Person.
To the extent, if any, that Borrower and any other Person share items
of expenses such as legal, auditing and other professional services,
such expenses will be allocated to the extent practical on the basis of
actual use or the value of services rendered, and otherwise on a basis
reasonably related to the actual use or the value of services rendered;
Borrower's operating expenses will not be paid by any other Person
except as permitted under the terms of this Agreement or otherwise
consented to by Administrator and Lender;
(e) Borrower's books and records will
be maintained separately from those of any other Person;
(f) All audited financial statements of
any Person that are consolidated to include Borrower will contain
detailed notes clearly stating that (A) all of Borrower's assets are
owned by Borrower, and (B) Borrower is a separate corporate entity;
(g) Borrower's assets will be
maintained in a manner that facilitates their identification and
segregation from those of any other Person;
39
46
(h) Borrower will strictly observe
corporate formalities in its dealings with all other Persons, and funds
or other assets of Borrower will not be commingled with those of any
other Person;
(i) Borrower shall not, directly or
indirectly, be named or enter into an agreement to be named, as a
direct or contingent beneficiary or loss payee, under any insurance
policy with respect to any amounts payable due to occurrences or events
related to any other Person; and
(j) Any Person that renders or
otherwise furnishes services to Borrower will be compensated thereby at
market rates for such services it renders or otherwise furnishes
thereto. Borrower will not hold itself out to be responsible for the
debts of any other Person or the decisions or actions respecting the
daily business and affairs of any other Person.
9.1.8 Adverse Claims on Receivables. Each of
Borrower and Servicer will, and will require Originator to, defend each
Receivable against all claims and demands of all Persons at any time
claiming the same or any interest therein adverse to Administrator and
the Secured Parties.
9.1.9 Further Assurances. At its expense, each of
Borrower and Servicer will perform all acts and execute all documents
reasonably requested by Administrator at any time to evidence, perfect,
maintain and enforce the title or the security interest of
Administrator in the Receivables and the priority thereof. Borrower
will, at the reasonable request of Administrator, execute (if required
by applicable law) and deliver financing statements relating to or
covering the Collateral and, where permitted by law, Borrower hereby
authorizes Administrator to file one or more financing statements
covering the Collateral without Borrower's signature. Borrower shall,
and shall cause Originator to, cause its computer records, master data
processing records and other books and records relating to the
Receivables to be marked, with a legend stating that the Receivables
have been sold to Borrower and that the Collateral has been pledged to
Administrator for the benefit of the Secured Parties.
9.1.10 Servicing. Servicer shall use all reasonable
measures to prevent or minimize any loss being realized on a Receivable
and shall take all reasonable steps to recover the full amount of such
loss. Borrower and Servicer shall, at their own expense, take such
steps as are necessary to maintain perfection of the security interest
created by each Receivable in the related goods and merchandise subject
thereto. Servicer shall use its best efforts, consistent with prudent
servicing procedures, to repossess or otherwise convert the ownership
of the goods or merchandise securing any Receivable which becomes a
Defaulted Receivable. Servicer shall follow such practices and
procedures for servicing the Receivables as would be customary and
usual for a prudent servicer under similar circumstances, including
using reasonable efforts to realize upon any recourse to the Obligors
and selling the goods securing a Receivable at a public or private
sale.
40
47
9.1.11 Inspection. Each of Borrower and Servicer
shall permit Lender, Administrator or their duly authorized
representatives, attorneys or auditors to inspect the Receivables, the
Receivable Files, Documents and the related accounts, records and
computer systems, software and programs used or maintained by Borrower
or Servicer at such times as Lender or Administrator may reasonably
request. Upon instructions from Lender or Administrator, each of
Borrower and Servicer shall release any document in its possession
related to any Receivables to Lender or Administrator, as the case may
be, or to the Servicer, if requested by Lender or Administrator.
9.1.12 Cooperation. Each of Borrower and Servicer
shall provide such cooperation, information and assistance, and prepare
and supply Administrator with such data regarding the performance by
the Obligors of their obligations under the Receivables and the
performance by Borrower and Servicer of their respective obligations
under the Transaction Documents, as may be reasonably requested by
Administrator from time to time.
9.1.13 Facility. Servicer shall maintain its
facility from which it services the Receivables in its present
condition, ordinary wear and tear excepted, or such other facility of
similar quality, security and safety as Servicer may select from time
to time. Servicer shall make all property tax payments, lease payments
and all other payments with respect to such facility. Servicer shall
(i) ensure that Administrator shall have complete and unrestricted
access, at Servicer's expense, to such facility and all computers and
other systems relating to the servicing of the Receivables and all
persons employed at such facility, (ii) use all commercially reasonable
efforts to retain the employees based at such facility to provide
assistance to Administrator and (iii) continue to store on a daily
basis all back-up files relating to the Receivables and the servicing
of the Receivables at the facilities of ChoicePoint, or such other
storage facility of similar quality, security and safety as Servicer
may select from time to time, in the case of each of clauses (i), (ii)
and (iii) until the receipt of all Collections in respect of all
Receivables or all Receivables have been written off in accordance with
the Credit and Collection Policy.
9.1.14 Accounts. Borrower shall not maintain any
bank accounts other than the accounts described on Schedule 8.12.
Except as set forth in the last sentence of Section 11.2.3(b), neither
Borrower nor Servicer shall make, nor will either of them permit
Originator to make, any change in its instructions to Obligors
regarding payments to be made to a LockBox. Neither Borrower nor
Servicer will, nor will either of them permit Originator to (a) add or
close any Depository Account or (b) add any LockBox Account Bank or
Lock Box Account to those listed on Schedule 8.12 unless Administrator
shall have consented thereto and received a copy of any new duly
executed LockBox and Blocked Account Agreement. Neither Borrower nor
Servicer will, nor will either of them permit Originator to, change any
LockBox Account Bank or close any LockBox or LockBox Account unless
Administrator shall have received at least thirty (30) days' prior
notice of such termination and (i) in the case of a closed LockBox, all
41
48
applicable Obligors have been notified to make payments to another
LockBox that clears through a LockBox Account which is subject to a
LockBox and Blocked Account Agreement, or (ii) in the case of
termination of a LockBox Bank or closing of a LockBox Account, a new
LockBox and Blocked Account Agreement is entered into with respect to
any new or replacement LockBox Account or LockBox Account Bank.
Section 9.2 Negative Covenants. From the date hereof
until the first day, following the Commitment Termination Date, on which all
Obligations shall have been finally and fully paid and performed, each of
Borrower and Servicer hereby covenants and agrees as to itself as follows:
9.2.1 Sales, Liens, Etc. Except pursuant to, or as
contemplated by, the Transaction Documents, Borrower shall not sell,
assign (by operation of law or otherwise) or otherwise dispose of, or
create or suffer to exist voluntarily or involuntarily any Adverse
Claims upon or with respect to any of its assets, including, without
limitation, the Collateral, any interest therein or any right to
receive any amount from or in respect thereof.
9.2.2 Mergers, Acquisitions, Sales, Subsidiaries,
etc. Borrower shall not:
(a) be a party to any merger or consolidation, or
directly or indirectly purchase or otherwise acquire all or
substantially all of the assets or any stock of any class of, or any
partnership or joint venture interest in, any other Person, except for
Permitted Investments, or sell, transfer, assign, convey or lease any
of its property and assets (or any interest therein) other than
pursuant to, or as contemplated by, this Agreement or the other
Transaction Documents;
(b) make, incur or suffer to exist an investment in,
equity contribution to, loan or advance to, or payment obligation in
respect of the deferred purchase price of property from, any other
Person, except for Permitted Investments or pursuant to the Transaction
Documents;
(c) create any direct or indirect Subsidiary or otherwise
acquire direct or indirect ownership of any equity interests in any
other Person other than pursuant to the Transaction Documents; or
(d) enter into any transaction with any Affiliate except
for the transactions contemplated by the Transaction Documents and
other transactions upon fair and reasonable terms materially no less
favorable to Borrower than would be obtained in a comparable arm's
length transaction with a Person not an Affiliate.
9.2.3 Change in Business; Change in Credit and
Collection Policy. Borrower will not make any change in the character
of its business. Neither Borrower nor Servicer will make any change in
the Credit and Collection Policy that could adversely affect the
collectibility of any Receivable.
42
49
9.2.4 Other Debt. Borrower will not incur any Debt
to any Person other than pursuant to this Agreement, the Receivables
Sale Agreement or otherwise in connection with a transaction involving
Lender, Bank, any Credit Bank, any Liquidity Bank or any other Persons
providing liquidity or credit support to Lender.
9.2.5 Certificate of Incorporation and By-Laws.
Borrower shall not amend its certificate of incorporation or by-laws.
9.2.6 Chief Executive Office. Borrower shall not
move its chief executive office or permit the documents and records
evidencing the Receivables to be moved unless (i) Borrower or Servicer,
as the case may be, shall have given to Administrator prior written
notice thereof, clearly describing the new location, and (ii) Borrower
shall have taken such action, satisfactory to Administrator, to
maintain the title or ownership of Borrower and any security interest
of Administrator in the Collateral at all times fully perfected and in
full force and effect. Servicer shall not, in any event, move the
location where it conducts the servicing and collection of the
Receivables from the address referred to on Schedule 15.3 to this
Agreement, without the prior written consent of Administrator, which
consent shall not be unreasonably withheld or delayed.
9.2.7 Financing Statements. Borrower shall not
execute any effective financing statement (or similar statement or
instrument of registration under the laws of any jurisdiction) or
statements relating to any Receivables other than the financing
statements described in Section 7.1.5.
9.2.8 Business Restrictions. Borrower shall not
(i) engage in any business other than the acquisition, financing and
collection of Receivables and other Collateral, (ii) engage in any
transactions or be a party to any documents, agreements or instruments,
other than the Transaction Documents and those incidental to the
purposes thereof, or (iii) incur any trade payables (other than for
professional fees incurred in the ordinary course of business) or other
liabilities not constituting Debt permitted under Section 9.2.4 if such
the aggregate outstanding balance of such trade payables and other
liabilities would at any time exceed $10,700.
9.2.9 Other Agreements; Performance Undertaking.
Borrower will not amend, restate, supplement, cancel, terminate or
otherwise modify the First Step Sale Agreement, the Receivables Sale
Agreement or the Performance Undertaking, or give any consent, waiver,
directive or approval thereunder or waive any default, action, omission
or breach under any of the foregoing or otherwise grant any indulgence
thereunder, without (in each case) the prior written consent of
Administrator.
43
50
ARTICLE X.
SIGNIFICANT EVENTS AND THEIR EFFECT
Section 10.1 Events of Default. Each of the following
shall constitute an "EVENT OF DEFAULT" under this Agreement:
10.1.1 Non-Payment of Loans, Etc. Borrower shall
fail to make any payment when due of any principal of or interest on
any Loan, or payment of any other Obligation payable by Borrower
hereunder or under the other Transaction Documents, including, without
limitation, any Fees and Indemnified Amounts, or shall fail to make any
deposit required to be made hereunder when due and, in each of the
foregoing cases, such failure shall continue for three (3) Business
Days.
10.1.2 Non-Compliance with Other Provisions.
Borrower shall:
(a) fail to perform or observe any covenant contained in
Section 9.2 of this Agreement and such failure shall remain unremedied
for three (3) days after the earlier to occur of (i) Executive Officer
of Borrower's having knowledge thereof and (ii) Borrower's having
received written notice thereof from the Lender or Administrator, or
(b) fail to perform or observe any other term, covenant
or agreement contained in this Agreement or any other Transaction
Document on its part to be performed or observed and any such failure
shall remain unremedied for thirty (30) days after the earlier to occur
of (i) Executive Officer of Borrower's having knowledge thereof and
(ii) Borrower's having received written notice thereof from the Lender
or Administrator.
10.1.3 Breach of Representations and Warranties.
Any representation, warranty, certification or statement made by
Borrower in this Agreement, any other Transaction Document to which
Borrower is a party or in any other document delivered pursuant hereto
or thereto shall prove to have been incorrect in any material respect
when made or deemed made; PROVIDED THAT the materiality threshold in
the preceding clause shall not be applicable with respect to any
representation or warranty which itself contains a materiality
threshold.
10.1.4 Bankruptcy. An Event of Bankruptcy shall
have occurred and remained continuing with respect to Borrower,
Servicer or Performance Guarantor.
10.1.5 Tax Liens. The Internal Revenue Service
shall file notice of a lien pursuant to ss. 6323 of the Internal
Revenue Code with regard to any of the assets of Borrower, and such
lien shall not have been released within fifteen (15) Business Days.
44
51
Section 10.2 Amortization Events. Each of the following
shall constitute an "AMORTIZATION EVENT" under this Agreement:
10.2.1 Servicer Event of Default. A Servicer Event
of Default shall have occurred and remained continuing.
10.2.2 Borrowing Base Deficit. A Borrowing Base
Deficit shall exist and such condition shall continue unremedied for
three (3) Business Days.
10.2.3 Default Ratio. The Default Ratio shall equal
or exceed 6.0% on a rolling three-month average basis.
10.2.4 Delinquency Ratio. The Delinquency Ratio
shall equal or exceed 7.0% on a rolling three-month average basis.
10.2.5 Dilution Ratio. The Dilution Ratio shall
equal or exceed 1.0% on a rolling three-month average basis.
10.2.6 Accounts Receivable Turnover Ratio. The
Accounts Receivable Turnover Ratio shall be less than 6.5 to 1 for any
Calculation Period.
10.2.7 Event of Default. An Event of Default shall
have occurred and be continuing.
10.2.8 Validity of Transaction Documents. (a) Any
Transaction Document, or any lien or security interest granted
thereunder, shall (except in accordance with its terms), in whole or in
part, terminate, cease to be effective or cease to be the legally
valid, binding and enforceable obligation of Borrower, Servicer or
Originator party to such Transaction Document, (b) Borrower, Originator
or Servicer shall, directly or indirectly, contest in any manner such
effectiveness, validity, binding nature or enforceability or (c) any
security interest securing any Secured Obligation shall, in whole or in
part, cease to be a perfected first priority security interest.
10.2.9 Termination Date. The Termination Date
(under and as defined in the Receivables Sale Agreement) shall occur,
or any Material Originator's Termination Date (under and as defined in
the First Step Sale Agreement) shall occur.
10.2.10 Performance Undertaking. Performance
Guarantor shall fail to perform or observe any term, covenant or
agreement required to be performed by it under the Performance
Undertaking, or the Performance Undertaking shall cease to be effective
or to be the legally valid, binding and enforceable obligation of
Performance Guarantor, or Performance Guarantor shall directly or
indirectly contest in any manner such effectiveness, validity, binding
nature or enforceability.
45
52
Section 10.3 Effect of Significant Event.
(a) Optional Termination. Upon the occurrence of a
Significant Event (other than an Event of Default described in Section 10.1.4),
Administrator may, and at the request of Lender shall, by notice to Borrower (a
copy of which shall be promptly forwarded by Administrator to each Rating
Agency), declare all or any portion of the outstanding principal amount of the
Loans and other Obligations to be due and payable and/or the Lender's Commitment
(if not theretofore terminated) to be terminated by declaring the Commitment
Termination Date to have occurred, whereupon the full unpaid amount of such
Loans and other Obligations which shall be so declared due and payable shall be
and become immediately due and payable, without further notice, demand or
presentment, and/or, as the case may be, the Lender's Commitment shall
terminate.
(b) Automatic Termination. Upon the occurrence of an
Event of Default described in Section 10.1.4 or Section 10.2.2), the Commitment
Termination Date shall be deemed to have occurred automatically, and all
outstanding Loans and all other Obligations shall become immediately and
automatically due and payable, all without presentment, demand, protest, or
notice of any kind.
(c) Notice to Rating Agencies. Administrator shall notify
each Rating Agency of the occurrence of any continuing Significant Event,
promptly following its actual knowledge thereof.
ARTICLE XI.
THE SERVICER
Section 11.1 ChoicePoint as Initial Servicer. The
servicing, administering and collection of the Receivables shall be conducted by
the Person designated from time to time as Servicer under the Servicing
Agreement. Until such time following the occurrence of a Servicer Default or an
Amortization Event as Administrator shall notify ChoicePoint and Borrower in
writing of the revocation of such power and authority, Borrower, Lender and
Administrator hereby appoint ChoicePoint to act as Servicer under the
Transaction Documents.
Section 11.2 Certain Duties of the Servicer.
11.2.1 Authorization to Act as Borrower's Agent.
Borrower hereby appoints Servicer as its agent for the following
purposes: (i) selecting the amount of each requested Loan and executing
Borrowing Requests on behalf of Borrower, (ii) making transfers among,
deposits to and withdrawals from all deposit accounts of Borrower for
the purposes described in the Transaction Documents, (iii) arranging
payment by Borrower of all Fees, expenses, other Obligations and other
amounts payable under the Transaction Documents, (iv) causing the
repayment and prepayment of the Loans as required or permitted pursuant
to Section 4.1, and (v) executing and preparing the Monthly Reports;
PROVIDED, HOWEVER, that Servicer shall act in such capacity only as an
agent of Borrower and shall incur thereby no additional obligations
with respect to any Loan. Borrower
46
53
irrevocably agrees that (A) it shall be bound by all proper actions
taken by Servicer pursuant to the preceding sentence, and (B) Lender,
Administrator and the banks holding all deposit accounts of Borrower
are entitled to accept submissions, determinations, selections,
specifications, transfers, deposits and withdrawal requests, and
payments from Servicer on behalf of Borrower.
11.2.2 Servicer to Act as Servicer; Originators as
Permitted Sub-Servicers.
(a) Servicer shall service and administer the Receivables
on behalf of Borrower and Administrator (for the benefit of the Secured
Parties) and shall have full power and authority, acting alone and/or
through sub-servicers as provided in Section 11.2.2(c), to do any and
all things which it may deem reasonably necessary or desirable in
connection with such servicing and administration and which are
consistent with this Agreement. Consistent with the terms of this
Agreement, Servicer may waive, modify or vary any term of any
Receivable or consent to the postponement of strict compliance with any
such term or in any manner, grant indulgence to any Obligor if, in
Servicer's reasonable determination, such waiver, modification,
postponement or indulgence is not materially adverse to the interests
of Borrower or Administrator (for the benefit of the Secured Parties);
PROVIDED, HOWEVER, that Servicer may not permit any modification with
respect to any Receivable that would reduce the Unpaid Balance (except
for actual payments thereof), or extend the due date thereof, except
that Servicer may take such actions with respect to Defaulted
Receivables if such actions will, in Servicer's reasonable business
judgment, maximize the Collections thereof. Without limiting the
generality of the foregoing, Servicer in its own name or in the name of
Borrower is hereby authorized and empowered by Borrower when Servicer
believes it appropriate in its best judgment to execute and deliver, on
behalf of Borrower, any and all instruments of satisfaction or
cancellation, or of partial or full release or discharge and all other
comparable instruments, with respect to the Receivables.
(b) Servicer shall service and administer the Receivables
by employing such procedures (including collection procedures) and
degree of care, in each case consistent with applicable law, with the
Credit and Collection Policy and with prudent industry standards, as
are customarily employed by Servicer in servicing and administering
receivables owned or serviced by Servicer comparable to the
Receivables. Servicer shall not take any action to impair
Administrator's (for the benefit of the Secured Parties) security
interest in any Receivable, except to the extent allowed pursuant to
this Agreement or required by law.
(c) Servicer may perform any of its duties pursuant to
this Agreement, including those delegated to it pursuant to this
Agreement, through the Originators and permitted sub-servicers
appointed by Servicer, PROVIDED that such sub-servicing arrangements
may be terminated, at Administrator's discretion, upon the replacement
of ChoicePoint as Servicer, and PROVIDED, FURTHER, that notwithstanding
any such delegation of a duty, Servicer shall remain primarily
47
54
obligated and liable for the performance of such duty as if Servicer
were performing such duty.
(d) Servicer may take such actions as are necessary to
discharge its duties as Servicer in accordance with this Agreement,
including the power to execute and deliver on behalf of Borrower such
instruments and documents as may be customary, necessary or desirable
in connection with the performance of Servicer's duties under this
Agreement (including consents, waivers and discharges relating to the
Receivables).
(e) Servicer shall keep separate records covering the
transactions contemplated by this Agreement, including the identity and
collection status of each Receivable purchased by Parent SPE from any
Originator and by Borrower from Parent SPE and the associated Purchase
Price Credits.
11.2.3 Collections.
(a) On or prior to the Closing Date, Borrower and
Servicer shall have established and shall maintain thereafter the
following system of collecting and processing Collections of
Receivables. The Obligors shall be instructed to make payments of
Receivables only by check, draft or money order mailed to a LockBox
listed on Schedule 8.12 (such payments, upon receipt in such a LockBox,
being referred to herein as "MAIL PAYMENTS"), or by wire transfer or
ACH to a LockBox Account or a Depository Account.
(b) On or prior to the Closing Date, Administrator shall
have received a LockBox Agreement with respect to each LockBox Account.
Servicer's right of access to any LockBox Account shall be revocable at
the option of Administrator upon the occurrence and during the
continuance of Unmatured Significant Event or Significant Event. In
addition, after the occurrence and during the continuance of any
Unmatured Significant Event or any Significant Event, Servicer agrees
that it shall, upon the written request of Administrator, notify all
Obligors under Receivables to make payment thereof to (i) one or more
bank accounts and/or post-office boxes designated by Administrator and
specified in such notice or (ii) any successor Servicer appointed
hereunder.
(c) Servicer shall remove all Mail Payments, or cause all
Mail Payments to be removed, from each LockBox by the close of business
on each Business Day and deposited into a LockBox Account. Servicer
shall process all such Mail Payments, and all wire transfers, ACH
payments and other payments on the date received by recording the
amount of the payment received from the Obligor and the applicable
account or invoice number.
(d) All Collections received by Originator or Servicer in
respect of Receivables will, pending remittance to a Depository Account
as provided in Section 11.2.4, be held by Originator or Servicer in
trust for the exclusive benefit
48
55
of Administrator, and shall not be commingled with any other funds or
property of Originator or Servicer.
(e) Borrower and Servicer hereby irrevocably waive any
right to set-off or otherwise deduct any amount owing by or to them
from any Collections received by them prior to remittance thereof in
accordance with this Agreement.
(f) In performing its duties and obligations hereunder,
Servicer (i) shall not impair the rights of Borrower or Administrator
in any Receivable, (ii) shall not amend the terms of any Receivable
other than in accordance with the Credit and Collection Policy and this
Agreement, (iii) shall not release any goods securing a Receivable from
the lien created by such Receivable except as specifically provided for
herein, and (iv) shall be entitled to commence or settle any legal
action to enforce collection of any Receivable or to foreclose upon or
repossess any goods securing such Receivable. In the event that
Servicer shall breach any of its covenants set forth in clause (i),
(ii) or (iii) of this Section 11.2.3(f), Servicer shall pay the Unpaid
Balance of each Receivable affected thereby on the Distribution Date
following the Calculation Period in which such event occurs. For the
purposes of Section 11.7 hereof, Servicer shall not be deemed to have
breached its obligations under this Section 11.2.3(f) unless it shall
fail to make such payment with respect to any Receivable affected by
Servicer's noncompliance with clause (i), (ii) or (iii) of this Section
11.2.3(f).
(g) All payments or other amounts collected or received
by Servicer in respect of a Receivable shall be applied to the Unpaid
Balance of such Receivable.
11.2.4 Depository Accounts.
(a) On any Business Day, Borrower may withdraw, or permit
Servicer to withdraw, funds that are on deposit in the Depository
Accounts, PROVIDED that (i) no Significant Event or Unmatured
Significant Event has occurred and is continuing, (ii) the Commitment
Termination Date has not occurred, and (iii) after giving effect to
such withdrawal, no Borrowing Base Deficit has occurred or will result
therefrom and there are funds in the Depository Accounts at least equal
to the interest on the Loans and the Fees accrued through such date.
(b) Prior to 3:00 p.m., New York time, on the Business
Day preceding each Distribution Date (a "DEPOSIT DATE"): (i) Servicer
shall deposit or cause to be deposited in a Depository Account, to the
extent not already on deposit therein, an amount equal to, without
duplication, the lesser of (A) the sum of (1) the aggregate amount of
all Collections received during the immediately preceding Calculation
Period, plus (2) the aggregate amounts due from Servicer on such
Distribution Date pursuant to Section 11.2.3(f) hereof, plus (3) the
aggregate amount of Purchase Price Credits, if any, required to be made
in cash on such Distribution Date in accordance with the Receivables
Sale Agreement, and (B) the amounts due on such Distribution Date
pursuant to clauses FIRST through SEVENTH
49
56
of Section 4.2(b), PROVIDED that if a Significant Event or Unmatured
Significant Event shall exist on such Distribution Date or the
Commitment Termination Date has occurred, then the Servicer shall
deposit all of the amounts described in the foregoing clause (A) in a
Depository Account on such Deposit Date.
(c) Servicer shall distribute the amounts on deposit in
the Depository Accounts in accordance with Section 4.2 hereof.
(d) Funds deposited in the Depository Accounts may be
invested by Servicer in Permitted Investments that mature not later
than the Business Day next preceding the Distribution Date. All income,
gain or losses realized from any such investment shall be credited or
debited (as applicable) to the balance of the applicable Depository
Account. Servicer shall have no obligation to reimburse any Depository
Account for any losses realized by reason of such investments.
Section 11.3 Servicing Compensation. Servicer, as
compensation for its activities hereunder, shall be entitled to receive the
Servicing Fee, which shall be payable by Borrower on each Distribution Date from
funds on deposit in the Depository Accounts in accordance with Section 4.2.
Servicer shall be required to pay all expenses incurred by it in connection with
its servicing activities hereunder (including payment of the fees and expenses
of any sub-servicer) and shall not be entitled to reimbursement therefor except
as specifically provided herein.
Section 11.4 Agreement Not to Resign. ChoicePoint
acknowledges that Lender and Administrator have relied on ChoicePoint's
agreement to act as Servicer hereunder in their respective decisions to execute
and deliver the respective Transaction Documents to which they are parties. In
recognition of the foregoing, ChoicePoint agrees not to resign as Servicer
voluntarily, except as required by law (as evidenced by the delivery of an
outside opinion of counsel to Administrator, in form and substance satisfactory
to Administrator), without the prior written consent of Administrator.
Section 11.5 Designation of Servicer. Borrower agrees not
to designate any Person other than ChoicePoint as Servicer without the prior
written consent of Administrator.
Section 11.6 Termination. The authorization of Servicer
to act on behalf of Borrower under this Agreement and the other Transaction
Documents shall terminate at the sole discretion of Administrator upon the
replacement of Servicer by a successor Servicer selected by Administrator.
Section 11.7 Servicer Events of Default. Each of the
following shall constitute a "SERVICER EVENT OF DEFAULT" under this Agreement:
11.7.1 Failure to Make Payments and Deposits.
Servicer shall fail to make any payment or deposit required to be made
by it hereunder on the date when due and, in each of the foregoing
cases, such failure shall continue for three (3) Business Days.
50
57
11.7.2 Non-Compliance with Other Provisions.
Servicer shall fail to perform or observe any other term, covenant or
agreement contained in this Agreement or any other Transaction Document
on its part to be performed or observed and any such failure shall
remain unremedied for thirty (30) days after the earlier to occur of
(i) Executive Officer of Servicer's having knowledge thereof and (ii)
Servicer's having received written notice thereof from the Lender or
Administrator.
11.7.3 Delegation. Servicer shall not delegate any
of its duties hereunder, except as expressly permitted in accordance
with the terms hereof.
11.7.4 Breach of Representations and Warranties.
Any representation, warranty, certification or statement made by
Servicer in this Agreement, any other Transaction Document to which
Servicer is a party or in any Borrowing Base Certificate, Monthly
Report or other document delivered pursuant hereto or thereto shall
prove to have been incorrect in any material respect when made or
deemed made; PROVIDED THAT the materiality threshold in the preceding
clause shall not be applicable with respect to any representation or
warranty which itself contains a materiality threshold.
11.7.5 Consolidated Tangible Net Worth. At any time
while ChoicePoint is the Servicer, the Consolidated Tangible Net Worth
of ChoicePoint and its Consolidated Subsidiaries is less than or equal
to $150,000,000;
11.7.6 Bankruptcy. An Event of Bankruptcy shall
have occurred and remained continuing with respect to Servicer.
11.7.7 Judgments. A final judgment or judgments for
the payment of money in excess of $10,700 in the aggregate shall have
been rendered against Borrower, or in excess of $5,000,000 in the
aggregate shall have been rendered against Servicer, and the same shall
have remained unsatisfied and in effect, without stay of execution, for
a period of thirty (30) consecutive days after the period for appellate
review shall have elapsed.
11.7.8 Cross-Default to Material Debt. Failure of
Servicer to pay any Debt in excess of $5,000,000 in aggregate principal
amount ("MATERIAL DEBT") when due; or the default by Servicer in the
performance of any term, provision or condition contained in any
agreement under which any Material Debt was created or is governed, the
effect of which is to cause, or to permit the holder or holders of such
Material Debt to cause, such Indebtedness to become due prior to its
stated maturity; or any Material Debt of Servicer 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.
At any time during the continuance of any Servicer Event of Default,
Administrator may, in its sole discretion, notify Servicer in writing of the
revocation of its appointment as Servicer hereunder. Upon revocation of
Servicer's appointment hereunder, Administrator shall appoint a
51
58
successor Servicer. Servicer agrees that upon receipt of written notification
from Administrator of the revocation of Servicer's appointment as Servicer
hereunder, Servicer shall upon the written request of Administrator (which
request may be contained in the notification of revocation) (i) notify all
Obligors under the Receivables to make payment thereof to a bank account(s) or
post office box designated by Administrator and specified in such notice, and
(ii) pay to Administrator (or its designee) immediately all Collections then
held or thereafter received by Servicer or Originator of Receivables, together
with all other payment obligations of the Servicer hereunder owing to Lender or
Administrator. Servicer shall, at its sole cost and expense, cooperate with and
assist the successor Servicer (including, without limitation, providing access
to, and transferring, all Receivable Files and all records (including
data-processing records) relating thereto (which shall be held in trust for the
benefit of the parties hereto in accordance with their respective interests))
and allowing the successor Servicer to use all licenses, hardware or software
necessary or desirable to collect the Receivables). ChoicePoint irrevocably
agrees to act (if requested to do so) as the data-processing agent for the
successor Servicer (in substantially the same manner as ChoicePoint conducted
such data-processing functions while it acted as Servicer).
ARTICLE XII.
ADMINISTRATOR
Section 12.1 Authorization and Action. Lender hereby
appoints SunTrust Equitable Securities Corporation as its Administrator for
purposes of the Transaction Documents and authorizes SunTrust Equitable
Securities Corporation in such capacity to take such action on its behalf under
each Transaction Document and to exercise such powers hereunder and thereunder
as are delegated to SunTrust Equitable Securities Corporation, as Administrator,
by the terms hereof and thereof, together with such powers as are reasonably
incidental thereto.
Section 12.2 Administrator and Affiliates. Bank and any
of its Affiliates may generally engage in any kind of business with Borrower,
Bank, Servicer, any Obligor, any of their respective Affiliates and any Person
who may do business with or own securities of Borrower, Bank, Servicer, any
Obligor or any of their respective Affiliates, all as if SunTrust Equitable
Securities Corporation were not Administrator and without any duty to account
therefor to Lender.
ARTICLE XIII.
ASSIGNMENTS
Section 13.1 Restrictions on Assignments. Neither
Borrower nor Servicer may assign its rights hereunder or any interest herein
without the prior written consent of Administrator and Lender. Lender may not
assign all or any portion of Lender's Commitment to any Person other than the
Liquidity Bank(s) without the prior written consent of Borrower and
Administrator; PROVIDED, HOWEVER, that each of the parties hereto agrees that
Borrower may withhold its consent to any proposed assignment to any Person that
(i) is not incorporated under the laws of the United States of America or a
state thereof, and (ii) fails to deliver to the Administrator prior to the
effectiveness of any such assignment two (2) duly completed copies of United
States Internal Revenue Service Form W-8BEN or W-8ECI, as applicable. Nothing
52
59
herein shall be deemed to preclude Lenders from pledging or assigning all or any
portion of any Loan or the Lender Note:
(a) to Credit Bank, any Liquidity Bank (or any successor
of any thereof by merger, consolidation or otherwise), any Affiliate of
Credit Bank or any Liquidity Bank in connection with a draw under the
Liquidity Agreement or a Credit Advance (which may then assign all or
any portion thereof so assigned or any interest therein to such party
or parties as it may choose); or
(b) to any other Person proposed by Lender and consented
to by Administrator.
Administrator shall promptly provide notice of any assignment to each Rating
Agency. Subject to Section 13.2, all of the aforementioned assignments shall be
upon such terms and conditions as Lender and the assignee may mutually agree.
Section 13.2 Documentation. Lender shall deliver to each
assignee an assignment, in such form as Lender and the related assignee may
agree, duly executed by Lender, assigning any such Loan to the assignee, and
Lender shall promptly execute and deliver all further instruments and documents,
and take all further action, that the assignee may reasonably request, in order
to perfect, protect or more fully evidence the assignee's right, title and
interest in and to such Loan, and to enable the assignee to exercise or enforce
any rights hereunder or under the Lender Note evidencing such Loan.
Section 13.3 Rights of Assignee. Upon the foreclosure of
any assignment of any Loans made for security purposes, or upon any other
assignment of any Loan from Lender pursuant to this Article XIII, the respective
assignee receiving such assignment shall have all of the rights of Lender
hereunder to the extent of such assignment with respect to such Loans and all
references to Lender in Section 6.1 shall be deemed to apply to such assignee to
the extent of such assignment.
Section 13.4 Notice of Assignment. Lender shall provide
notice to Borrower of any assignment hereunder by Lender to any assignee. Lender
authorizes Administrator to, and Administrator agrees that it shall, endorse the
Lender Note to reflect any assignments made pursuant to this Article XIII or
otherwise.
ARTICLE XIV.
INDEMNIFICATION
Section 14.1 General Indemnity of Borrower. Without
limiting any other rights which any such Person may have hereunder or under
applicable law, Borrower hereby agrees to indemnify Administrator, Lender,
Servicer, each Liquidity Bank, each Credit Bank, Bank, each of Bank's Affiliates
and each of their respective successors, transferees, participants and assigns
and all officers, directors, shareholders, controlling persons, employees and
agents of any of the foregoing (each of the foregoing Persons being individually
called an "INDEMNIFIED PARTY"), forthwith on demand, on an after-tax basis, from
and against any and all damages, losses, claims, liabilities and related costs
and expenses, including reasonable attorneys' fees and disbursements (all of the
foregoing being collectively called "INDEMNIFIED AMOUNTS") awarded against or
53
60
incurred by any of them arising out of or relating to any Transaction Document
or the transactions contemplated thereby, any commingling of funds (whether or
not permitted hereunder), or the use of proceeds therefrom by Borrower,
including (without limitation) in respect of the funding of any Loan or in
respect of any Receivable; EXCLUDING, HOWEVER, (a) Indemnified Amounts to the
extent a final judgment of a court of competent jurisdiction holds that such
Indemnified Amounts resulted from gross negligence or willful misconduct on the
part of the Indemnified Party seeking indemnification, and (b) Excluded Taxes.
Section 14.2 Indemnity of Servicer. Without limiting any
other rights which any such Person may have hereunder or under applicable law,
ChoicePoint as Servicer, hereby agrees to indemnify each Indemnified Party
forthwith on demand, on an after-tax basis, from and against any and all
Indemnified Amounts awarded against or incurred by any of them arising from, or
related to, the negligence or willful misconduct of ChoicePoint, the inaccuracy
of any representation or warranty of ChoicePoint, or the failure of ChoicePoint
to perform its obligations under any Transaction Document; EXCLUDING, HOWEVER,
(a) Indemnified Amounts to the extent determined by a court of competent
jurisdiction to have resulted from gross negligence or willful misconduct on the
part of such Indemnified Party, (b) Indemnified Amounts to the extent solely due
to non-payment by any Obligor of an amount due and payable with respect to a
Receivable for credit reasons, and (c) any tax upon or measured by net income on
any Indemnified Party.
ARTICLE XV. MISCELLANEOUS
Section 15.1 No Waiver; Remedies. No failure on the part
of Lender, Administrator, any Indemnified Party or any Affected Party to
exercise, and no delay in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise by any of
them of any right, power or remedy hereunder preclude any other or further
exercise thereof, or the exercise of any other right, power or remedy. The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law. Without limiting the foregoing, each of Bank, each Credit Bank
and each Liquidity Bank is hereby authorized by Borrower at any time and from
time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by Bank, such Credit Bank
or such Liquidity Bank to or for the credit or the account of Borrower, now or
hereafter existing under this Agreement, to Administrator, any Affected Party,
any Indemnified Party, or Lender or their respective successors and assigns.
Section 15.2 Amendments, Etc. No amendment, modification
or waiver of, or consent with respect to, any provision of this Agreement and
any Schedules hereto, or the Lender Note shall in any event be effective unless
the same shall be in writing and signed and delivered by (i) Borrower, Servicer,
Administrator and Lender (with respect to an amendment), or (ii) Administrator
and Lender (with respect to a waiver or consent by them) or Servicer or Borrower
(with respect to a waiver or consent by them), as the case may be, and then any
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given; PROVIDED, HOWEVER, that no material
amendment of this Agreement (other than an
54
61
amendment to extend the Scheduled Commitment Termination Date) shall be
effective unless the Lender (or Administrator on its behalf) shall have received
written confirmation by the Rating Agencies that such amendment shall not cause
the rating on the then outstanding Commercial Paper Notes to be downgraded or
withdrawn. Administrator shall provide each Rating Agency with a copy of each
amendment to or consent or waiver under this Agreement promptly following the
effective date thereof.
Section 15.3 Notices, Etc. All notices and other
communications provided for hereunder shall, unless otherwise stated herein, be
in writing (including facsimile communication) and shall be personally delivered
or sent by certified mail, postage prepaid, or by facsimile, to the intended
party at the address or facsimile number of such party set forth opposite its
name on Schedule 15.3 hereto or at such other address or facsimile number as
shall be designated by such party in a written notice to the other parties
hereto. All such notices and communications shall be effective, (a) if
personally delivered, when received, (b) if sent by certified mail, three
Business Days after having been deposited in the mail, postage prepaid, (c) if
sent by overnight courier, one Business Day after having been given to such
courier, and (d) if transmitted by facsimile, when sent, receipt confirmed by
telephone or electronic means, except that notices and communications pursuant
to Section 2.2 shall not be effective until received.
Section 15.4 Costs, Expenses and Taxes. In addition to
its obligations under Section 14.1, Borrower agrees to pay (or to cause to be
paid) on demand:
(a) all reasonable costs and expenses incurred by
Administrator, Lender, each Liquidity Bank, each Credit Bank and
Servicer in connection with (i) the preparation, execution, delivery,
administration and enforcement of, or any breach of, this Agreement,
the Lender Note, the other Transaction Documents, the Liquidity
Agreement and, to the extent directly related to this Agreement, the
Program Documents (including any amendments or modifications of or
supplements to the Program Documents directly related to this
Agreement), including, without limitation, the reasonable fees and
expenses of counsel to any of such Persons incurred in connection
therewith, (ii) the perfection of Administrator's security interest in
the Collateral, (iii) the maintenance of the Depository Accounts and
the LockBox Accounts, (iv) the audit of the books, records and
procedures of Originator, Servicer and Borrower by Administrator's
auditors (which may be employees of Administrator), and (v) Rating
Agency fees related to the transactions contemplated by this Agreement;
and
(b) all stamp and other transactional or filing taxes and
fees payable or determined to be payable in connection with the
execution, delivery, filing and recording of this Agreement, the Lender
Note, the other Transaction Documents, or (to the extent directly
related to this Agreement) the Program Documents, and agrees to
indemnify each Indemnified Party against any liabilities with respect
to or resulting from any delay in paying or omission to pay such taxes
and fees.
Section 15.5 Binding Effect; Survival. This Agreement
shall be binding upon and inure to the benefit of Borrower, Bank, Lender,
Administrator, and their respective successors and assigns, and the provisions
of Article VI and Article XIV shall inure to the
55
62
benefit of the Affected Parties and the Indemnified Parties, respectively, and
their respective successors and assigns; PROVIDED, HOWEVER, nothing in the
foregoing shall be deemed to authorize any assignment not permitted by Article
XIII. This Agreement shall create and constitute the continuing obligations of
the parties hereto in accordance with its terms, and shall remain in full force
and effect until such time, after the Commitment Termination Date, when all
Obligations have been finally and fully paid and performed. The rights and
remedies with respect to any breach of any representation and warranty made by
Borrower or Servicer pursuant to Article VIII and the indemnification and
payment provisions of Article XIV and Article VI, Sections 15.4, 15.11 and 15.12
shall be continuing and shall survive any termination of this Agreement and any
termination of ChoicePoint's rights to act as Servicer hereunder or under any
other Transaction Document.
Section 15.6 Captions and Cross References. The various
captions (including, without limitation, the table of contents) in this
Agreement are provided solely for convenience of reference and shall not affect
the meaning or interpretation of any provision of this Agreement. Unless
otherwise indicated, references in this Agreement to any Section, Appendix,
Schedule or Exhibit are to such Section of or Appendix, Schedule or Exhibit to
this Agreement, as the case may be, and references in any Section, subsection,
or clause to any subsection, clause or subclause are to such subsection, clause
or subclause of such Section, subsection or clause.
Section 15.7 Severability. Any provision of this
Agreement which is 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 of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 15.8 Governing Law. THIS AGREEMENT SHALL BE A
CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF (OTHER THAN SECTION
5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW) EXCEPT TO THE EXTENT THAT THE
LAWS OF ANOTHER JURISDICTION GOVERN THE PERFECTION, OR THE EFFECT OF PERFECTION
OR NONPERFECTION, OF THE SECURITY INTERESTS OF THE ADMINISTRATOR, FOR THE
BENEFIT OF THE SECURED PARTIES.
Section 15.9 Counterparts. This Agreement may be executed
by the parties hereto in several counterparts, each of which shall be deemed to
be an original but all of which shall constitute together but one and the same
agreement.
Section 15.10 Submission to Jurisdiction; Waiver of Trial
by Jury.
(a) Each of Borrower and Servicer hereby submits to the
nonexclusive jurisdiction of any United States District Court for the
Southern District of New York and of any New York state court sitting
in New York, New York for purposes of all legal proceedings arising out
of, or relating to, the Transaction Documents or the transactions
contemplated thereby. Each of Borrower and Servicer hereby irrevocably
waives, to the fullest extent possible, any objection it may now or
hereafter have to the venue of any such proceeding and any claim
56
63
that any such proceeding has been brought in an inconvenient forum.
Nothing in this Section 15.10 shall affect the right of Administrator
or Lender to bring any action or proceeding against Borrower or
Servicer or their respective properties in the courts of other
jurisdictions.
(b) TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY
HERETO IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF, OR IN CONNECTION WITH, ANY
TRANSACTION DOCUMENT OR ANY MATTER ARISING THEREUNDER.
Section 15.11 Limitation on Recourse.
(a) The obligations of the Lender under this Agreement
are solely the corporate obligations of Lender. No recourse shall be
had for any obligation, covenant or agreement (including, without
limitation, the payment of any amount owing in respect to this
Agreement or the payment of any Fee hereunder or for any other
obligation or claim) arising out of or based upon this Agreement or any
other agreement, instrument or Transaction Document entered into
pursuant hereto or in connection herewith against any stockholder,
employee, officer, director, manager, administrator, partner or
incorporator of Lender, as such, by the enforcement of any assessment
or by any legal or equitable proceeding, by virtue of any statute or
otherwise.
(b) Notwithstanding any provisions contained in this
Agreement to the contrary, Lender shall not, and shall not be obligated
to, pay any amount pursuant to this Agreement unless (i) Lender has
received funds which may be used to make such payment and which funds
are not required to repay the Commercial Paper when due and (ii) after
giving effect to such payment, either (A) Lender could issue Commercial
Paper Notes to refinance all outstanding Commercial Paper Notes
(assuming such outstanding Commercial Paper Notes matured at such time)
in accordance with the program documents governing Lender's
securitization program or (B) all Commercial Paper Notes are paid in
full; PROVIDED, HOWEVER, that the foregoing limitations on payments by
Lender shall not apply to any distributions of funds received by Lender
pursuant to Section 4.2. Any amount which Lender does not pay pursuant
to the operation of the preceding sentence shall not constitute a claim
(as defined in ss.101 of the Bankruptcy Code) against or corporate
obligation of Lender for any such insufficiency unless and until Lender
satisfies the provisions of clauses (i) and (ii) above.
Section 15.12 No Proceedings. Each of the parties hereto
hereby agree that it will not institute against Lender, or join any other Person
in instituting against Lender, any insolvency proceeding (namely, any proceeding
of the type referred to in the definition of Event of Bankruptcy) so long as any
Commercial Paper Notes issued by Lender shall be outstanding and there shall not
have elapsed one year plus one day since the last day on which any such
57
64
Commercial Paper Notes shall be outstanding. The provisions of this Section
15.12 shall survive the termination hereof.
Section 15.13 Confidentiality.
(a) Unless otherwise consented to by Administrator or
required by any applicable law, rule, regulation, direction, request or order of
any judicial, administrative or regulatory authority or proceedings, each of
Borrower and Servicer hereby agrees that it shall maintain and shall cause each
of its employees and officers to maintain the confidentiality of the Fee Letter
and the other confidential or proprietary information with respect to
Administrator and Lender and their respective businesses obtained by it or them
in connection with the structuring, negotiating and execution of the
transactions contemplated herein, except that each of Borrower, Servicer and
their respective officers and employees may disclose such information to their
external accountants, attorneys and other advisors and as required by any
applicable law, rule, direction, request or order of any judicial,
administrative or regulatory authority or proceeding (whether or not having the
force or effect of law). The restrictions in this Section 15.13(a) shall not
apply to any information which is or becomes generally available to the public
other than as a result of disclosure by Borrower, Servicer or one of their
respective Affiliates.
(b) Each of Borrower and Servicer hereby consents to the
disclosure of any nonpublic information with respect to it (i) to Administrator,
the Liquidity Banks or Lender by each other, (ii) as required by or pursuant to
any applicable law, rule, regulation, direction, request or order of any
judicial, administrative or regulatory authority or proceedings (whether or not
having the force or effect of law), (iii) to any prospective or actual assignee
or participant of any of the Persons described in clause (i), and (iv) to any
Rating Agency, Commercial Paper Note dealer, Credit Bank or Support Provider to
Lender or any entity organized for the purpose of purchasing, or making loans
secured by, financial assets for which Administrator acts as the administrative
agent or administrator and to any officers, directors, employees, outside
accountants and attorneys of any of the foregoing, PROVIDED each Person
described in the foregoing clauses (iii) and (iv) is informed of the
confidential nature of such information.
Section 15.14 Entire Agreement. This Agreement and the
other Transaction Documents executed and delivered herewith represent the final
agreement among the parties hereto and thereto and may not be contradicted by
evidence of prior, contemporaneous or subsequent oral agreements of the parties.
There are no unwritten oral agreements among the parties.
[SIGNATURE PAGES BEGIN ON NEXT PAGE]
58
65
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the day
and year first above written.
CHOICEPOINT FINANCIAL INC., AS BORROWER
By: /s/ David E. Trine
--------------------------------------------
Name: David E. Trine
Title: Treasurer
CHOICEPOINT INC., AS INITIAL SERVICER
By: /s/ David E. Trine
--------------------------------------------
Name: David E. Trine
Title: Treasurer
59
66
THREE PILLARS FUNDING CORPORATION, AS LENDER
By: /s/ Douglas K. Johnson
--------------------------------------------
Name: Douglas K. Johnson
Title: President
60
67
SUNTRUST EQUITABLE SECURITIES CORPORATION, AS ADMINISTRATOR
By: /s/ James R. Bennison
--------------------------------------------
Name: James R. Bennison
Title: Managing Director
61