Exhibit 10.2
U.S. $250,000,000
FOURTH AMENDED AND RESTATED
PARALLEL PURCHASE COMMITMENT
Dated as of April 10, 2002
Among
POLYONE FUNDING CORPORATION
AS SELLER
and
POLYONE CORPORATION
AS COLLECTION AGENT
and
CITIBANK, N.A.
AS ORIGINAL BANK
and
CITICORP NORTH AMERICA, INC.
AS GROUP MANAGING AGENT AND AS AGENT
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Defined Terms...........................................2
SECTION 1.02. Incorporation by Reference......................................7
SECTION 1.03. Other Terms.....................................................7
SECTION 1.04. Computation of Time Periods.....................................7
SECTION 1.05. Accounting Terms................................................7
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01. Commitment......................................................8
SECTION 2.02. Making Purchases................................................8
SECTION 2.03. Termination or Reduction of the Bank Commitments................9
SECTION 2.04..................................................................9
SECTION 2.05..................................................................9
SECTION 2.06..................................................................9
SECTION 2.07..................................................................9
SECTION 2.08..................................................................9
SECTION 2.09..................................................................9
SECTION 2.10. Fees and Payments...............................................9
SECTION 2.11. Increased Costs................................................10
SECTION 2.12. Maintenance of Purchase Account................................11
SECTION 2.13. Sharing of Payments, Etc.......................................12
i
ARTICLE III
CONDITIONS OF EFFECTIVENESS AND OF PURCHASES
SECTION 3.01. Conditions Precedent to Effectiveness..........................12
SECTION 3.02. Conditions Precedent to All Purchases and Reinvestments........14
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Seller...................15
SECTION 4.02. Representations and Warranties of the Collection Agent.........15
ARTICLE V
GENERAL COVENANTS OF THE SELLER
AND THE COLLECTION AGENT
SECTION 5.01. Affirmative Covenants of the Seller............................16
SECTION 5.02. Reporting Requirements of the Seller...........................16
SECTION 5.03. Negative Covenants of the Seller...............................16
SECTION 5.04. Affirmative Covenants of the Collection Agent..................16
SECTION 5.05. Negative Covenants of the Collection Agent.....................16
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. Designation of Collection Agent................................17
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01. Events of Termination..........................................17
ARTICLE VIII
THE AGENT AND THE GROUP managing AGENTS
SECTION 8.01. Authorization and Action of the Agent..........................20
ii
SECTION 8.02. Authorization and Action of the Group Managing Agents.........21
SECTION 8.03. Agent's and Group Managing Agents' Reliance, Etc...............21
SECTION 8.04. Rights and Powers..............................................22
SECTION 8.05. Purchase Decisions.............................................22
SECTION 8.06. Indemnification................................................23
SECTION 8.07. Successor Agent................................................23
SECTION 8.08. Authorizations and Actions Within Investor Groups..............24
ARTICLE IX
ASSIGNMENT of eligible assets
SECTION 9.01. Assignment.....................................................24
SECTION 9.02. Assignment of Rights and Obligations...........................25
SECTION 9.03. Annotation of Certificate......................................27
ARTICLE X
INDEMNIFICATION
SECTION 10.01. Indemnities by the Seller.....................................27
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. Amendments, Etc...............................................29
SECTION 11.02. Notices, Etc..................................................30
SECTION 11.03. No Waiver; Remedies...........................................30
SECTION 11.04. Binding Effect; Assignability.................................31
SECTION 11.06. Costs, Expenses and Taxes.....................................31
SECTION 11.07. No Proceedings................................................32
SECTION 11.08. Confidentiality...............................................32
SECTION 11.09. Jurisdiction, Etc.............................................33
iii
SECTION 11.10. Grant of a Security Interest..................................33
SECTION 11.11. Execution in Counterparts.....................................33
SECTION 11.12. Intent of the Parties.........................................33
SECTION 11.13. Entire Agreement..............................................34
SECTION 11.14. Severability of Provisions....................................34
SECTION 11.15. Waiver of Jury Trial..........................................34
iv
EXHIBITS
EXHIBIT A Form of Assignment
EXHIBIT B Form of Assignment and Acceptance
EXHIBIT C Form of Certificate
v
FOURTH AMENDED AND RESTATED
PARALLEL PURCHASE COMMITMENT
Dated as of April 10, 2002
POLYONE FUNDING CORPORATION, a Delaware corporation (the "SELLER"),
POLYONE CORPORATION, an Ohio corporation ("POLYONE"), individually and as
Collection Agent (as herein defined), CITIBANK, N.A. (the "ORIGINAL BANK"), and
CITICORP NORTH AMERICA, INC., a Delaware corporation ("CNAI"), as a Group
Managing Agent (as herein defined) and as agent for itself, the other Group
Managing Agents (as herein defined), the Banks and the Eligible Asset Owners (as
herein defined) (in such capacity, the "Agent"), agree as follows:
PRELIMINARY STATEMENTS.
(1) Certain terms which are capitalized and used throughout this
Agreement (in addition to those defined above) are defined in Article I of this
Agreement.
(2) PolyOne, the Original Bank, and the Agent were party to that
certain Third Amended and Restated Parallel Purchase Commitment dated as of May
28, 1999 and as further amended on February 9, 2000, August 31, 2000, March 14,
2001, June 22, 2001 and January 1, 2002 (as so amended, the "ORIGINAL PARALLEL
PURCHASE COMMITMENT") whereby the Original Bank agreed to purchase from PolyOne
"Eligible Assets" (as defined in the Original Parallel Purchase Commitment) in
accordance with, and subject to the terms and conditions of, the Original
Parallel Purchase Commitment.
(3) Pursuant to that certain Assignment and Assumption dated as of the
date hereof (the "POLYONE ASSIGNMENT") between PolyOne, as assignor, and the
Seller, as assignee, PolyOne has sold and assigned to the Seller, and the Seller
has purchased and assumed from PolyOne, all of PolyOne's rights and obligations
under the Original Parallel Purchase Commitment as of the date hereof.
(4) The Seller will from time to time purchase from PolyOne and the
other Originators (as defined in Section 1.01 hereof) Pool Receivables in which
the Seller intends to sell interests referred to herein as Eligible Assets.
(5) Pursuant to the terms of the Investor Agreement (as herein
defined), each of the Investors may, in its absolute and sole discretion, make
"Purchases" of "Eligible Assets" under and as defined in the Investor Agreement
from the Seller from time to time.
(6) In the event that any Investor declines to make any such
"Purchase' under and as defined in the Investor Agreement, the Members (as
herein defined) of such Investor's Investor Group (as herein defined) shall, at
the request of the Seller, make such Purchase in accordance with, and subject
to, the terms and conditions hereof.
(7) CNAI has been requested and is willing to continue to act as Agent
pursuant to the terms hereof.
(8) The parties hereto have agreed to amend and restate the Original
Parallel Purchase Commitment, as modified by the PolyOne Assignment, on the
terms and conditions hereinafter set forth, to provide for, among other things,
the sale of Eligible Asset interests in the Receivables Pool, as contemplated by
Preliminary Statement (7) above.
NOW, THEREFORE, the parties hereby agree that, effective as of the
Restatement Effective Date, the Original Parallel Purchase Commitment is hereby
amended and restated in its entirety to read as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. CERTAIN DEFINED TERMS. (a) Unless otherwise defined
herein, and subject to the modifications herein set forth, capitalized terms
used in this Agreement or in any provisions of the Investor Agreement
incorporated herein by reference shall have the meanings given to them in the
Investor Agreement. Without limiting the foregoing, the defined terms
"Contracts," "Credit and Collection Policy" and "Seller Report," together with
the related Schedule II, Schedule III, Exhibit E, Exhibit F and Exhibit G,
respectively, of the Investor Agreement, are hereby incorporated by reference.
(b) As used in this Agreement, the following terms shall have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined):
"AFFILIATE BANK" means, in respect of any Investor, any Bank that is
an Affiliate of such Investor.
"AFFILIATED INVESTOR" means, in respect of any Investor Group, the
Investor whose Affiliate Bank is or was, prior to any Assignment by such
Affiliate Bank pursuant to Article IX, a Member of such Investor's Investor
Group.
"AGENT'S ACCOUNT" means the special account (account number
[4060-5071]) of the Agent maintained at the office of Citibank at 399 Park
Avenue, New York, New York.
"ASSIGNEE" means (a) in the case of any assignment of any Eligible
Asset or portion thereof pursuant to Section 9.01, any Eligible Assignee as
the assignee of such Eligible Asset or such portion and (b) in the case of
any assignment of any rights and obligations pursuant to Section 9.02, any
Eligible Assignee as the assignee of such rights and obligations.
"ASSIGNMENT" means an assignment, in substantially the form of Exhibit
A hereto, by which an Eligible Asset may be assigned pursuant to Section
9.01.
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"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance, in
substantially the form of Exhibit B hereto, entered into by any Member and
an Assignee pursuant to Section 9.02.
"BANK COMMITMENT" of any Bank means (i) in respect of the Original
Bank, the amount set forth as the "Bank Commitment" opposite the name of
the Original Bank on the signature pages hereto and (ii) in respect of each
Bank that becomes a Bank by entering into an Assignment and Acceptance, the
amount set forth as the "Bank Commitment" for such Bank in the Register
maintained by the Agent pursuant to Section 9.02(c), in the case of clauses
(i) and (ii) as such amount may be reduced from time to time as the result
of any assignment of any Bank Commitment or any portion thereof pursuant to
Section 9.02 or may be reduced from time to time pursuant to Section 2.03.
"BANK RATE" for any Fixed Period for any Eligible Asset means the
interest rate defined as the "Assignee Rate" in the Investor Agreement.
"BANKS" means the Original Bank and each Assignee that shall become a
party hereto pursuant to Section 9.02.
"CAPITAL" means, in respect of any Eligible Asset, the original amount
paid to the Seller for such Eligible Asset at the time of its acquisition
by a Bank, pursuant to Sections 2.01 and 2.02, or such amount divided or
combined by any dividing or combining of such Eligible Asset Pursuant to
Section 2.09, in each case reduced from time to time by Collections
received and distributed on account of such Capital pursuant to Section
2.06; PROVIDED, HOWEVER, that such Capital of such Eligible Asset shall not
be reduced by any distribution of any portion of Collections if at any time
such distribution is rescinded or must otherwise be returned for any
reason.
"CERTIFICATE" means a certificate of assignment by the Seller to the
Agent on behalf of any Bank in the form of Exhibit C hereto, evidencing
each Eligible Asset.
"CITIBANK" means Citibank, N.A., a national banking association.
"COLLECTION AGENT" has the meaning assigned to that term in Section
6.01.
"COLLECTION AGENT FEE" has the meaning assigned to that term in
Section 2.10.
"COMMITMENT TERMINATION DATE" means the earliest of (a) April 9, 2003,
UNLESS, prior to such date (or the date so extended pursuant to this
clause), upon the Seller's request made not more than 90 nor less than 45
days prior to the then Commitment Termination Date, one or more Banks
having 100% of the aggregate Bank Commitments shall in their sole
discretion consent, which consent shall be given not more than 30 days
prior to the then Commitment Termination Date, to the extension of the
Commitment Termination Date to the date occurring 360 days after the then
Commitment Termination Date, PROVIDED, HOWEVER, that any failure of any
Bank to respond to the Seller's request for such extension shall be deemed
a denial of such request by such Bank, (b) the
3
"Facility Termination Date" under the Investor Agreement, and (c) the date
of termination of the Commitment pursuant to Section 2.03 or Section 7.01.
"CREDIT AGREEMENT" means the Five-Year Credit Agreement dated as of
October 30, 2000, as amended by the Letter Waiver thereto dated as of March
31, 2001, Amendment No. 1 to the Five-Year Credit Agreement dated as of
March 31, 2001, the Letter Waiver dated as of September 30, 2001, Amendment
No. 2 to the Five-Year Credit Agreement dated as of November 21, 2001,
Amendment No. 3 to the Five-Year Credit Agreement dated as of January 17,
2002 and Amendment, Waiver and Consent No. 4 to the Five-Year Credit
Agreement dated as of March 28, 2002, among the Seller, the banks,
financial institutions and other institutional lenders party thereto as
Lenders, Salomon Smith Barney Inc., as sole lead arranger, Deutsche Bank
Securities Inc. and Bank One, NA as syndication agents and Citicorp USA,
Inc. as administrative agent for the Lenders, as such agreement may
hereafter be further amended, amended and restated, supplemented or
otherwise modified from time to time.
"ELIGIBLE ASSET OWNER" means, in respect of each Eligible Asset, upon
its purchase by any of the Banks as a purchaser thereof, the Bank which
made such purchase; PROVIDED, HOWEVER, that, upon any assignment thereof or
a portion thereof pursuant to Article IX, the assignee thereof shall be an
Eligible Asset Owner thereof.
"ELIGIBLE ASSIGNEE" means (i) a commercial bank organized under the
laws of the United States, or any state thereof, and having total assets in
excess of $5,000,000,000; (ii) a savings and loan association or savings
bank organized under the laws of the United States, or any state thereof,
and having total assets in excess of $5,000,000,000; (iii) a commercial
bank organized under the laws of any other country that is a member of the
Organization for Economic Cooperation and Development ("OECD") or has
concluded special lending arrangements with the International Monetary Fund
associated with its General Arrangements to Borrow or of the Cayman
Islands, or a political subdivision of any such country, and having total
assets in excess of $5,000,000,000; (iv) the central bank of any country
that is a member of the OECD; (v) a finance company, insurance company or
other financial institution or fund (whether a corporation, partnership,
trust or other entity) that is engaged in making, purchasing or otherwise
investing in commercial loans in the ordinary course of its business and
having total assets in excess of $5,000,000,000; (vi) any Affiliate of a
Bank and (vii) any other Person approved by the Agent and the Seller, such
approval not to be unreasonably withheld; PROVIDED, HOWEVER, that an
Affiliate of the Seller shall not qualify as an Eligible Assignee.
"EVENT OF TERMINATION" has the meaning assigned to that term in
Section 7.01.
"GROUP COMMITMENT" means, in respect of any Investor Group, the
aggregate amount of the Bank Commitments of the Members of such Investor
Group.
"GROUP MANAGING AGENT" means, in respect of any Investor Group, the
Managing Agent of the Affiliated Investor or Investors of such Investor
Group.
"INDEMNIFIED AMOUNTS" has the meaning specified in Section 10.01.
4
"INDEMNIFIED PARTY" means any or all of the Banks, Citibank, CNAI, the
Assignees, the Investors, the Participants, the Group Managing Agents and
the Agent and their respective Affiliates and successors and assigns and
their respective officers, directors, employees, agents and advisors.
"INVESTOR" means each of Corporate Receivables Corporation, a
California corporation, Ciesco, L.P., a New York limited partnership, each
being an "Investor" pursuant to the Investor Agreement, and each Assignee
(as defined in the Investor Agreement) that shall become a party to the
Investor Agreement pursuant to Section 9.02 thereof.
"INVESTOR AGREEMENT" means the Fifth Amended and Restated Trade
Receivables Purchase and Sale Agreement, dated as of the date hereof among
the Seller, PolyOne, individually and as Collection Agent, the Investors
and CNAI, as Managing Agent and as agent for itself, the Managing Agents,
the Investors and the other Owners, as the same may be amended, amended and
restated, supplemented or otherwise modified from time to time in
accordance with its terms.
"INVESTOR GROUP" means, in respect of any Investor, such Investor's
Affiliate Bank (for so long as such Affiliate Bank has any Bank Commitment
or owns any Eligible Asset), together with any Person that either becomes
an owner of any interest in any Eligible Asset now or hereafter owned by
such Affiliate Bank or assumes all or part of the Bank Commitment of such
Affiliate Bank pursuant to the terms hereof, including, without limitation,
any Person who becomes an Assignee of such Affiliate Bank pursuant to
Article IX hereof (each of the foregoing referred to herein as a "MEMBER"
of such Investor Group).
"MAJORITY INVESTOR GROUPS" means, at any time, Investor Groups owning
in the aggregate at least 66 ?% of the aggregate Group Commitments.
"MAJORITY MEMBERS" means, in respect of any Investor Group at any
time, the Members of such Investor Group owning in the aggregate at least
51% of the then aggregate outstanding Eligible Assets owned by the Members
of such Investor Group or, if no Eligible Asset is then owned by any Member
of such Investor Group, Members of such Investor Group holding at least 51%
of such Investor Group's Group Commitment.
"MEMBER" has the meaning set forth in the definition of "Investor
Group" contained in this Section 1.01. The term "Member," when used without
reference to any Investor Group, means any Member of any Investor Group;
and the term "Members", when used without reference to any Investor Group,
means any or all Members of any or all Member Groups.
"MOODY'S" means Moody's Investors Service, Inc.
"ORIGINAL BANK" has the meaning set forth in the recital of parties
hereto.
"ORIGINAL PARALLEL PURCHASE COMMITMENT" has the meaning set forth in
the Preliminary Statements.
5
"POLYONE ASSIGNMENT" has the meaning set forth in the Preliminary
Statements.
"PRO RATA SHARE" means, for any Member, such Member's Bank Commitment
divided by the Group Commitment of such Member's Investor Group.
"PURCHASE" means a purchase by any Investor Group of an Eligible Asset
from the Seller pursuant to Article II.
"REGISTER" has the meaning set forth in Section 9.02(c).
"REINVESTMENT TERMINATION DATE" means, for any Eligible Asset, that
Business Day which the Seller designates or, if the conditions precedent in
Section 3.02 are not satisfied, that Business Day which the Agent (with the
consent or at the request of the Members holding such Eligible Asset)
designates, as the first date on which Collections in respect of such
Eligible Asset shall not be reinvested in accordance with Section 2.05, by
notice to the Agent (if the Seller so designates) or to the Seller (if the
Agent so designates) at least one Business Day prior to such designated
Business Day.
"RESTATEMENT EFFECTIVE DATE" has the meaning set forth in Section
3.01.
"S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill companies.
"TERMINATION DATE" means, for any Eligible Asset, the earlier of (i)
the Reinvestment Termination Date for such Eligible Asset and (ii) the
Commitment Termination Date.
"YIELD" means for each Eligible Asset, during any Fixed Period,
BR x C x ED + LF
--
360
where:
BR = the Bank Rate for such Eligible Asset for such Fixed Period
C = the Capital of such Eligible Asset during such Fixed Period
ED = the actual number of days elapsed during such Fixed Period
LF = the Liquidation Fee, if any, for such Eligible Asset for
such Fixed Period
PROVIDED, HOWEVER, that no provision of this Agreement or any Certificate
shall require the payment or permit the collection of Yield in excess of
the maximum permitted by applicable law; and PROVIDED FURTHER that Yield
for any Eligible Asset shall not be considered paid by any distribution if
at any time such distribution is rescinded or must otherwise be returned
for any reason.
6
SECTION 1.02. INCORPORATION BY REFERENCE. Various provisions of
(including defined terms) and Exhibits and Schedules to the Investor Agreement
(as in effect on the date hereof and whether or not the Investor Agreement is
hereafter terminated) are specifically incorporated in this Agreement by
reference, with the same force and effect as if the same were set out in this
Agreement in full. All references in such incorporated provisions to the "Agent"
and "Agreement" shall, without further reference, mean and refer to CNAI as
Agent under this Agreement and this Agreement, respectively, and, without
limitation, all references in such incorporated provisions to "Collections,"
"Concentration Limit," "Contract," "Credit and Collection Policy," "Default
Ratio," "Defaulted Receivable," "Delinquency Ratio," "Delinquent Receivable,"
"Eligible Asset," "Eligible Receivable," "Excess Concentration Amount," "Net
Receivables Pool Balance," "Pool Receivable," "Receivable," "Receivables Pool,"
"Related Security," "Required Net Receivables Pool Balance." "Special
Concentration Limit," "Dilution Horizon," "Dilution Percentage," "Dilution
Ratio," "Dilution Reserve" and "Dilution Volatility" shall mean and refer to
Collections, the Concentration Limit, a Contract, the Credit and Collection
Policy, the Default Ratio, a Defaulted Receivable, the Delinquency Ratio, a
Delinquent Receivable, an Eligible Asset, an Eligible Receivable, the Excess
Concentration Amount, the Net Receivables Pool Balance, a Pool Receivable, a
Receivable, the Receivables Pool, the Related Security, the Required Net
Receivables Pool Balance, the Special Concentration Limit, the Dilution Horizon,
the Dilution Percentage, the Dilution Ratio, the Dilution Reserve and the
Dilution Volatility under this Agreement, respectively; likewise, to the extent
any word or phrase is defined in this Agreement, any such word or phrase
appearing in provisions so incorporated by reference from the Investor Agreement
shall have the meaning given to it in this Agreement. The incorporation by
reference into this Agreement from the Investor Agreement is for convenience
only and this Agreement and the Investor Agreement shall at all times be, and be
deemed to be and treated as, separate and distinct facilities. Incorporations by
reference in this Agreement from the Investor Agreement shall not be affected or
impaired by any subsequent expiration or termination of the Investor Agreement,
nor by any amendment thereof or waiver thereunder unless the Agent, as Agent for
the Group Managing Agents and the Banks, shall have consented to such amendment
or waiver in writing.
SECTION 1.03. OTHER TERMS. All terms used in Article 9 of the UCC in
the State of New York, and not specifically defined herein, are used herein as
defined in such Article 9.
SECTION 1.04. 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."
SECTION 1.05. ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in the preparation of the
financial statements referred to in Section 4.01(e) of the Investor Agreement as
incorporated herein by reference ("GAAP").
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ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01. COMMITMENT. On the terms and conditions hereinafter set
forth, each Member of each Investor Group severally agrees that, from time to
time prior to the Commitment Termination Date, in the event that no Affiliated
Investor of such Member's Investor Group has determined to make any "Purchase"
under and as defined in the Investor Agreement, if so requested by the Seller,
each such Member of such Investor Group shall make its Pro Rata Share of a
Purchase of such "Purchase"; PROVIDED, HOWEVER, that no Member of such Investor
Group shall be obligated to make any Purchase if, after giving effect to such
Purchase, the aggregate outstanding Capital of such Member's Pro Rata Share of
Eligible Assets owned by such Investor Group, together with such Member's Pro
Rata Share of the aggregate outstanding "Capital" of "Eligible Assets" owned by
the Affiliated Investor or Investors of such Member's Investor Group, would
exceed such Member's Bank Commitment. Each Purchase shall be made by the Members
of the applicable Investor Group simultaneously and ratably in accordance with
their respective Pro Rata Shares. The Eligible Asset Owner of each Eligible
Asset shall, with the proceeds of Collections attributable to such Eligible
Asset, reinvest, pursuant to Section 2.05, in additional undivided percentage
interests in the Pool Receivables by making an appropriate readjustment of such
Eligible Asset.
SECTION 2.02. MAKING PURCHASES. (a) Each Purchase by the Members of an
Investor Group hereunder shall be made on at least three Business Days' notice
from the Seller to the Agent or on such other notice period as the Seller and
the Agent (with the consent or at the request of the Group Managing Agent of
such Investor Group) shall agree. Each such notice of a proposed Purchase shall
specify (i) the aggregate amount requested to be paid by the applicable Members
of such Investor Group to the Seller (such amount, which shall not be less than
$1,000,000, being referred to herein as the initial "CAPITAL" of the Eligible
Asset then being purchased), (ii) the date of such Purchase (which shall be a
Business Day) and (iii) the desired duration of the initial Fixed Period for the
Eligible Asset to be purchased. The Agent shall promptly notify the Group
Managing Agent, and each Member of such Investor Group of such notice of such
proposed Purchase. The Agent (with the consent or at the request of the Group
Managing Agent of such Investor Group) shall notify the Seller whether the
desired duration of the initial Fixed Period for the Eligible Asset to be
purchased is acceptable. Such notice of purchase shall be sent by telecopier,
telex or cable.
(b) Prior to 2:00 P.M., New York City time, on the date of each such
Purchase by the Members of any Investor Group, each Member of such Investor
Group shall, upon satisfaction of the applicable conditions set forth in Article
III, make available to the Seller the amount of such Member's Pro Rata Share of
the amount of the Capital of the Eligible Assets being acquired in such Purchase
by deposit of such Pro Rata Share in immediately available funds to the Seller
at the Seller's Account.
(c) Each Member's obligation in connection with any Purchase by such
Member's Investor Group shall be several, such that the failure of any Member to
make available such Member's Pro Rata Share of any Purchase shall not relieve
any other Member of its obligation, if any, hereunder to make available such
other Member's Pro Rata Share of such
8
Purchase on the date of such Purchase, but no Member shall be responsible for
the failure of any other Member to make available such other Member's Pro Rata
Share of such Purchase. Nothing in this Section 2.02 shall be deemed to
prejudice any rights the Seller may have against any Member as a result of any
failure by such Member to make a Purchase hereunder.
(d) Each notice of a Purchase delivered pursuant to Section 2.02(a)
shall be irrevocable and binding on the Seller. The Seller shall indemnify each
Group Managing Agent and each Member against any actual loss or expense incurred
by such Group Managing Agent and/or such Member as a result of any failure to
fulfill on or before the date of any Purchase (as to which notice has been given
pursuant to Section 2.02(a)) the applicable conditions set forth in Article III,
including, without limitation, any actual loss or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Group Managing Agent and/or such Member to fund its ratable portion of such
Purchase when such Purchase, as a result of such failure, is not made on such
date.
(e) The Agent shall, on the first day of each Fixed Period for each
Eligible Asset hereunder, notify the Seller and each Member of the Investor
Group that owns such Eligible Asset or any interest therein, of the Bank Rate
for such Fixed Period.
SECTION 2.03. TERMINATION OR REDUCTION OF THE BANK COMMITMENTS. (a)
OPTIONAL. The Seller may, upon at least five Business Days' notice to the Agent,
terminate in whole or reduce in part, ratably for each Member, the unused
portions of the Bank Commitments of the Members; PROVIDED, HOWEVER, that, for
purposes of this Section 2.03(a), the unused portions of the Bank Commitments of
the Members shall be computed as the excess of (i) the aggregate of the Bank
Commitments of the Members immediately prior to giving effect to such
termination or reduction over (ii) the sum of (A) the aggregate Capital of
Eligible Assets outstanding at the time of such computation and (B) the
aggregate "Capital" of "Eligible Assets" outstanding under and as defined in the
Investor Agreement at such time; PROVIDED FURTHER that each partial reduction
(i) shall be in an amount equal to $5,000,000 or an integral multiple of
$1,000,000 in excess thereof and (ii) shall be made ratably among the Members in
accordance with their respective Bank Commitments.
(b) MANDATORY. On each day on which the Seller shall, pursuant to
Section 2.03(a) of the Investor Agreement, reduce in part the unused portion of
the aggregate Purchase Limits (as defined in the Investor Agreement), the
aggregate Bank Commitments shall automatically, and ratably for the Members in
accordance with their respective Bank Commitments, reduce by an equal amount.
The aggregate Bank Commitments shall automatically terminate in whole on any day
on which the Seller shall terminate in whole the aggregate Purchase Limits
pursuant to Section 2.03(a) of the Investor Agreement.
SECTIONS 2.04 through 2.09. INCORPORATION BY REFERENCE. Each of
Sections 2.04 through 2.09 of the Investor Agreement is hereby incorporated
herein by this reference, except that each reference therein to an "Investor",
an "Owner" or a "Managing Agent" shall be deemed to be a reference to a Member,
an Eligible Asset Owner or a Group Managing Agent, respectively, and each
reference therein to the "Parallel Purchase Commitment" shall be deemed to be a
reference to the Investor Agreement.SECTION 2.04. SECTION 2.05. SECTION 2.06.
SECTION 2.07. SECTION 2.08. SECTION 2.09. SECTION 2.10. FEES AND PAYMENTS. (a)
The Seller shall pay certain
9
fees to the Agent for the account of the Agent, the Group Managing Agents and
the Members, as the case may be, such fees as are more fully set forth in the
Fee Letter.
(b) The Members of each Investor Group that own any Eligible Asset
shall pay to the Collection Agent a collection fee (the "COLLECTION AGENT FEE")
of 1/4 of 1% per annum on the average daily amount of Capital of each Eligible
Asset owned by such Members, from the date thereof until the later of the
Commitment Termination Date or the date on which such Capital is reduced to
zero, payable on the last day of each Settlement Period for such Eligible Asset;
PROVIDED, HOWEVER, that upon three Business Days' notice to the Agent, the
Collection Agent may (if not the Seller) elect to be paid, as such fee, another
percentage per annum on the average daily amount of Capital of each such
Eligible Asset, but in no event in excess of 110% of the costs and expenses
referred to in Section 6.02(b); and PROVIDED FURTHER that such fees shall be
payable only from Collections pursuant to, and subject to the priority of
payment set forth in, Sections 2.05 and 2.06.
SECTION 2.11. INCREASED COSTS. (a) If, due to either (i) introduction
of or any change in or in the interpretation of any law or regulation occurring
on or after the effective date of this Agreement or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law) issued on or after the effective date
of this Agreement, there shall be any increase in the amount of capital required
or expected to be maintained by any Member, any Eligible Asset Owner, any entity
which enters into a commitment to purchase Eligible Assets or interests therein,
or any of their respective Affiliates (as defined in the Investor Agreement)
(each an "AFFECTED PERSON") or any corporation controlling such Affected Person,
as a result of or based upon the existence of any commitment to make purchases
of or otherwise to maintain the investment in Pool Receivables or interests
therein related to this Agreement or to the funding thereof and other
commitments of the same type relating to this Agreement, then, within five
Business Days after receipt of a written demand by such Affected Person (with a
copy to the Agent), the Seller shall immediately pay to the Agent, for the
account of such Affected Person (as a third-party beneficiary), from time to
time as specified by such Affected Person, additional amounts sufficient to
compensate such Affected Person in the light of such circumstances, to the
extent that such Affected Person reasonably determines such increase in capital
to be allocable to the existence of any of such commitments. A certificate as to
such amounts setting forth in reasonable detail the calculations used in
determining, and the basis of the requirements for, such amounts, submitted to
the Seller and the Agent by such Affected Person, shall be conclusive and
binding for all purposes, absent evidence of error. Notwithstanding anything to
the contrary contained in this subsection (a), a Bank shall only be entitled to
receive reimbursement for such additional amounts pursuant to this subsection
(a) to the extent incurred within 60 days prior to, and at any time after, the
date on which such Bank gives to the Seller a notice that an event has occurred
as a result of which such additional amounts will arise or a notice that the
Seller is obligated to pay such additional amounts, whichever first occurs.
(b) If, due to either (i) the introduction of or any change occurring
on or after the effective date of this Agreement (other than any change by way
of imposition or increase of reserve requirements referred to in Section 2.12)
in or in the interpretation of any law or regulation or (ii) the compliance with
any guideline or request from any central bank or other governmental authority
(whether or not having the force of law) issued on or after the effective
10
date of this Agreement, there shall be any increase in the cost to any Member of
agreeing to purchase or purchasing, or maintaining the ownership of Eligible
Assets in respect of which Yield is computed by reference to the Eurodollar
Rate, then, within five Business Days after receipt of a written demand by such
Member (with a copy to the Agent), the Seller shall pay to the Agent, for the
account of such Member (as a third-party beneficiary), from time to time as
specified, additional amounts sufficient to compensate such Member for such
increased costs. A certificate as to the amount of such increased cost setting
forth in reasonable detail the calculations used for determining, and the basis
of the requirements for, such increased costs, submitted to the Seller and the
Agent by such Member shall be conclusive and binding for all purposes, absent
evidence of error. Notwithstanding anything to the contrary contained in this
subsection (b), a Member shall only be entitled to receive reimbursement for
such increased costs to the extent incurred within 60 days prior to, and at any
time after, the date on which such Member gives to the Seller a notice that an
event has occurred as a result of which such increased costs will arise or a
notice that the Seller is obligated to pay increased costs, whichever first
occurs.
(c) So long as no Event of Termination shall have occurred and be
continuing, any Member claiming any additional amounts payable pursuant to
Sections 2.11(a) and 2.11(b) shall, upon request from the Seller delivered to
such Member and the Agent specifying an Eligible Assignee willing and able to
assume and accept all such Member's rights and obligations under this Agreement,
assign, in accordance with the provisions of Section 9.02, all of its rights and
obligations under this Agreement to such Eligible Assignee in consideration for
(i) the payment by such assignee to such Member the aggregate Capital of all
Eligible Assets owned by such Member and all Yield thereon accrued to the date
of such assignment, together with any and all other amounts owing to such Member
under any provision of this Agreement accrued to the date of such assignment,
and (ii) the release of such Member from any further liability hereunder. The
processing and recordation fee required under Section 9.07(a) of the Credit
Agreement shall be paid by the Seller under this Section 2.11(c).
SECTION 2.12. MAINTENANCE OF PURCHASE ACCOUNT. (a) Each Member shall
maintain in accordance with its usual practice an account in which shall be
recorded from time to time the amount of each portion of each Purchase made by
such Member and all amounts received by such Member hereunder.
(b) The Register maintained by the Agent pursuant to Section 9.02(c)
shall include a control account, and a monitoring account for each Member, in
which accounts (taken together) shall be recorded (i) the date and amount of
each Purchase made hereunder and each Fixed Period applicable to each Eligible
Asset purchased hereunder, (ii) the terms of each Assignment and/or Assignment
and Acceptance delivered to and accepted by it, (iii) the amount of any Capital
or Yield due and payable or to become due and payable to the Members of each
Investor Group out of Collections hereunder, and (iv) the amount of any sum
received by the Agent from the Seller hereunder and each Member's share thereof.
(c) The entries made in the Register shall be prima facie evidence of
the existence and the accuracy of the Purchases and other information to be
recorded by the Agent pursuant to subsections (a) and (b) of this Section 2.13.
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SECTION 2.13. SHARING OF PAYMENTS, ETC. If any Member shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise) on account of the Purchases made by it (other than with
respect to payments due to such Bank pursuant to Section 2.10, 2.11 or 2.12) in
excess of its ratable share of payments on account of the Purchases obtained by
all the Members, such Member shall forthwith purchase from the other Members
such interests in the Eligible Assets purchased by them as shall be necessary to
cause such purchasing Member to share the excess payment ratably with each of
them; PROVIDED, HOWEVER, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Member, such purchase from each other
Member shall be rescinded and such other Member shall repay to the purchasing
Member the purchase price to the extent of such recovery together with an amount
equal to such other Member's ratable share (according to the proportion of (i)
the amount of such other Member's required repayment to (ii) the total amount so
recovered from the purchasing Member) of any interest or other amount paid or
payable by the purchasing Member in respect of the total amount so recovered.
The Seller agrees that any Member so purchasing an interest in Eligible Assets
from another Member pursuant to this Section 2.14 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off) with respect to such interest in Eligible Assets as fully as if such
Member were the direct creditor of the Seller in the amount of such interest in
Eligible Assets.
ARTICLE III
CONDITIONS OF EFFECTIVENESS AND OF PURCHASES
SECTION 3.01. CONDITIONS PRECEDENT TO EFFECTIVENESS. This Agreement
shall become effective on and as of the date hereof (the "RESTATEMENT EFFECTIVE
DATE") PROVIDED that the following steps occur on or before the Restatement
Effective Date, and such steps shall be deemed to have occurred in the following
order on the Restatement Effective Date:
FIRST, PolyOne and the Seller shall execute and deliver the PolyOne
Assignment, under which PolyOne sells and assigns to the Seller, and the
Seller purchases and assumes from PolyOne, all of PolyOne's rights and
obligations under the Original Parallel Purchase Commitment as of the date
hereof; and
SECOND, the Agent shall have received, and shall have notified the
Collection Agent and the Banks of its receipt of, (i) counterparts of this
Agreement executed by the Seller, the Collection Agent, each Bank and each
Group Managing Agent, if any, and the Agent, (ii) payment from PolyOne of
the fees that are due and payable on the Restatement Effective Date under
the Fee Letter, and (iii) the following, each of which (unless otherwise
indicated) shall be dated such date, in form and substance satisfactory to
the Agent:
(a) The Parent Undertaking, duly executed by PolyOne;
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(b) The Certificates for the Members, respectively (and the Original
Bank will cancel the "Certificate" as defined under the Original Parallel
Purchase Commitment and deliver it to PolyOne);
(c) The Receivables Contribution and Sale Agreement, duly executed by
the Seller and each Originator, together with:
1. Proper financing statements naming each Originator as debtor, the
Seller as secured party and CNAI, as Agent, as assignee, to be filed
under the UCC of all jurisdictions that the Agent may deem necessary
or desirable in order to perfect the Seller's interests created or
purported to be created by the Receivables Contribution and Sale
Agreement;
2. Proper financing statement amendments, if any, necessary to release
all security interests and other rights of any Person in the
Receivables, Related Security, Collections or Contracts previously
granted by each Originator;
3. Completed requests for information, dated on or a date reasonably
near to the date of the initial Purchase, listing all effective
financing statements which name each Originator (under its present
name and any previous name) as debtor and which are filed in the
jurisdictions in which filings were made pursuant to subsection (c)(i)
above, together with copies of such financing statements (none of
which, except those filed pursuant to subsection (c)(i) above, shall
cover any Receivables, Related Security, Collections or Contracts);
4. The Consent and Agreement, duly executed by the Seller and each
Originator; and
5. Subordinated Notes, duly executed by the Seller, to the order of
each of the Originators, respectively.
(d) Certified copies of the charter and by-laws, as amended, of each
of the Seller, PolyOne and each other Originator, respectively;
(e) Good Standing certificates issued by the Secretary of State of the
State of Delaware with respect to the Seller and good standing certificates
issued by the Secretaries of State of Ohio, Virginia and Delaware with
respect to each Originator;
(f) A copy of the resolutions adopted by the Board of Directors of (i)
the Seller approving the Transaction Documents to be delivered by it
hereunder and the transactions contemplated hereby and thereby and (ii)
each Originator approving the Transaction Documents to be delivered by it
hereunder and the transactions contemplated hereby and thereby, in each
case certified by its Secretary or Assistant Secretary;
(g) A certificate of the Secretary or Assistant Secretary of (i)
Seller certifying the names and true signatures of the officers authorized
on its behalf to sign the Transaction Documents and the other documents to
be delivered by it hereunder, and (ii) each Originator certifying the names
and true signatures of the officers authorized on its
13
behalf to sign the Transaction Documents and the other documents to be
delivered by it hereunder (on which certificates the Agent and each
Eligible Asset Owner shall be entitled to conclusively rely until such time
as the Agent shall have received from the Seller or any Originator, as the
case may be, a revised certificate meeting the requirements of this
subsection (g));
(h) Proper financing statements naming the Seller as debtor and CNAI,
as Agent, as secured party, to be filed under the UCC of all jurisdictions
that the Agent may deem necessary or desirable in order to perfect the
interests created or purported to be created hereby;
(i) Proper financing statements, if any, necessary to delete those
Receivables, Contracts, Related Security or Collections covered by, or to
terminate the effectiveness of, other financing statements naming the
Seller as debtor or seller and covering any Receivables, Contracts, Related
Security and Contracts;
(j) Completed requests for information, dated on or a date reasonably
near to the date of the initial Purchase, listing all effective financing
statements filed in the jurisdictions referred to in subsection (h) above
that name the Seller as debtor, together with copies of such other
financing statements (none of which, except those filed pursuant to
subsection (h) above, shall cover any Receivables, Contracts, Related
Security or Collections;
(k) The Lock-Box Agreements duly executed by the Lock-Box Banks and
the Seller or any Originator, as applicable;
(l) An executed copy of the Investor Agreement duly executed by the
Seller, PolyOne, CNAI and each Investor (as defined therein) thereunder;
(m) The Fee Letter duly executed by PolyOne and the Seller;
(n) Favorable opinions of (i) Thompson Hine LLP, counsel to the Seller
and each Originator, substantially in the form of Exhibit I-1 to the
Investor Agreement, (ii) senior corporate counsel to the Seller and each
Originator, substantially in the form of Exhibit I-2 to the Investor
Agreement, and (iii) Thompson Hine LLP, counsel to the Seller and each
Originator in substantially the form of Exhibit I-3 to the Investor
Agreement, including (A) a "true sale" opinion with respect to the sale of
Receivable Assets under and as defined in the Receivables Contribution and
Sale Agreement from each Originator to the Seller and (B) an opinion with
respect to the non-substantive consolidation of the Seller with each
Originator or any of its Affiliates in a case under the U.S. Bankruptcy
Code; and
(o) A favorable opinion of counsel for the Agent, as the Agent may
reasonably request.
SECTION 3.02. CONDITIONS PRECEDENT TO ALL PURCHASES AND REINVESTMENTS.
Each Purchase (including the initial Purchase after the Restatement Effective
Date) hereunder and the right of the Collection Agent to reinvest in Pool
Receivables those Collections attributable to an
14
Eligible Asset pursuant to Section 2.05 or 2.06 shall be subject to the further
conditions precedent that:
(a) With respect to any such Purchase, on or prior to the date of such
Purchase, the Collection Agent shall have delivered to the Agent, in form
and substance satisfactory to the Agent, (i) a completed Seller Report
requested to be delivered to the Agent pursuant to Section 2.07,
demonstrating, among other things, that after giving effect to such
Purchase, (A) the Net Receivables Pool Balance shall not be less than the
Required Net Receivables Pool Balance and (B) no Event of Termination shall
occur and (ii) a listing by Obligor of all Pool Receivables and such
additional information as may be reasonably requested by the Agent;
(b) On the date of such Purchase or reinvestment the following
statements shall be true (and the Seller by accepting proceeds of such
Purchase or by receiving the proceeds of such reinvestment shall be deemed
to have certified on the date of such purchase or reinvestment that):
(i) The representations and warranties contained in Section 4.01
hereof and Section 3.01 of the Receivables Contribution and Sale
Agreement are correct on and as of such date as though made on and as
of such date before and after giving effect to such Purchase or
reinvestment and to the application of proceeds therefrom other than
representations or warranties that, by their terms, refer to a date
other than the date of such Purchase or reinvestment; and
(ii) No event has occurred and is continuing, or would result
from such Purchase or reinvestment or from the application of proceeds
therefrom, which constitutes an Event of Termination or would
constitute an Event of Termination but for the requirement that notice
be given or time elapse or both; and
(c) The Agent shall have received such other approvals, opinions or
documents as the Agent may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE SELLER. Each of
the representations and warranties of the Seller, as set forth in Section 4.01
of the Investor Agreement (including Schedules I and IV), is hereby incorporated
herein by this reference and is deemed to be herein restated and hereby
reconfirmed in favor of the Members, the Group Managing Agents and the Agent.
SECTION 4.02. REPRESENTATIONS AND WARRANTIES OF THE COLLECTION AGENT.
Each of the representations and warranties of the Collection Agent set forth in
Section 4.02 of the Investor Agreement is hereby incorporated herein by this
reference and is deemed to be herein restated and hereby reconfirmed in favor of
the Members, the Group Managing Agents and the Agent.
15
ARTICLE V
GENERAL COVENANTS OF THE SELLER
AND THE COLLECTION AGENT
SECTION 5.01. AFFIRMATIVE COVENANTS OF THE SELLER. Until the later of
the Commitment Termination Date and the date upon which no Capital for any
Eligible Asset shall be existing and no Yield, Program Fees or other amounts
shall remain unpaid under this Agreement, the Seller shall, unless the Majority
Investor Groups shall otherwise consent in writing, comply with each and every
affirmative covenant of the Seller as set forth in Section 5.01 of the Investor
Agreement, each of which is hereby incorporated herein by this reference.
SECTION 5.02. REPORTING REQUIREMENTS OF THE SELLER. Until the later of
the Commitment Termination Date and the date upon which no Capital for any
Eligible Asset shall be existing and no Yield, Program Fees or other amounts
shall remain unpaid under this Agreement, the Seller shall, unless the Majority
Investor Groups shall otherwise consent in writing, furnish to the Agent each
and every report, document, certificate or other item referred to in Section
5.02 of the Investor Agreement, which is incorporated herein by this reference,
except that each reference in Section 5.02(c) to an "Event of Investment
Ineligibility" shall be and be deemed to be a reference to an Event of
Termination.
SECTION 5.03. NEGATIVE COVENANTS OF THE SELLER. Until the later of the
Commitment Termination Date and the date upon which no Capital for any Eligible
Asset shall be existing and no Yield, Program Fees or other amounts shall remain
unpaid under this Agreement, the Seller shall not, without the written consent
of the Majority Investor Groups (or in the case of subsection (c) of Section
5.03 of the Investor Agreement, the prior written consent of all the Members),
violate any negative covenant set forth in Section 5.03 of the Investor
Agreement, each of which is incorporated herein by this reference.
SECTION 5.04. AFFIRMATIVE COVENANTS OF THE COLLECTION AGENT. Until the
later of (i) the Commitment Termination Date and (ii) the date on which no
Capital for any Eligible Asset shall be existing and no Yield, Program Fees or
other amounts shall remain unpaid under this Agreement, the Collection Agent
shall, unless the Majority Investor Groups shall otherwise consent in writing,
comply with each covenant of the Collection Agent set forth in Section 5.04 of
the Investor Agreement, each of which is hereby incorporated herein by this
reference.
SECTION 5.05. NEGATIVE COVENANTS OF THE COLLECTION AGENT. Until the
later of (i) the Commitment Termination Date and (ii) the date on which no
Capital for any Eligible Asset shall be existing and no Yield, Program Fees or
other amounts shall remain unpaid under this Agreement, the Collection Agent
shall, unless the Majority Investor Groups shall otherwise consent in writing
(or in the case of subsection (b) of Section 5.05 of the Investor Agreement, the
prior written consent of all the Members), comply with each covenant of the
Collection Agent set forth in Section 5.05 of the Investor Agreement, each of
which is hereby incorporated herein by this reference.
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ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. DESIGNATION OF COLLECTION AGENT. The servicing,
administering and collection of the Pool Receivables shall be conducted by such
Person (the "COLLECTION AGENT") so designated from time to time in accordance
with this Section 6.01. Until the Agent (with the consent or at the request of
the Majority Investor Groups) gives three Business Days' notice to the Seller
and PolyOne of a designation of a new Collection Agent, PolyOne is hereby
designated as, and hereby agrees to perform the duties and obligations of, the
Collection Agent pursuant to the terms hereof. The Agent may (with the consent
or at the request of the Majority Investor Groups) at any time designate as
Collection Agent any Person (including itself) to succeed PolyOne or any
successor Collection Agent if the Agent shall determine in its reasonable
discretion that such action is necessary to protect the interest of any Eligible
Asset Owner in the Receivables, on the condition in each case that any such
Person so designated shall agree to perform the duties and obligations of the
Collection Agent pursuant to the terms hereof. The Collection Agent may, with
the prior consent of the Agent (with the consent or at the request of the
Majority Investor Groups), subcontract with any other Person for servicing,
administering or collecting the Pool Receivables, PROVIDED that the Collection
Agent shall remain liable for the performance of the duties and obligations of
the Collection Agent pursuant to the terms hereof.
SECTIONS 6.02. through 6.05. INCORPORATION BY REFERENCE. Each of
Sections 6.02 through 6.05 of the Investor Agreement is hereby incorporated
herein by this reference, except that the reference in said Section 6.02(b) to
"Facility Termination Date" shall be and be deemed to be a reference to the
Commitment Termination Date.
ARTICLE VII
EVENTS OF TERMINATION
SECTION 7.01. EVENTS OF TERMINATION. If any of the following events
("EVENTS OF TERMINATION") shall occur and be continuing:
(a) (i) The Collection Agent (if other than the Agent or Citibank)
shall fail to perform or observe any term, covenant or agreement hereunder
(other than as referred to in clause (ii) of this Section 7.01(a)) and such
failure shall remain unremedied for three Business Days or (ii) the Seller
or the Collection Agent (if other than the Agent or Citibank) shall fail to
make any payment or deposit to be made by it hereunder or under the Fee
Letter when due; or
(b) The Seller or the Collection Agent shall fail to perform or
observe any term, covenant or agreement contained in Section 5.01(e) or
(g), 5.02(c), 5.03, 5.04(e) or (g), or 5.05 of this Agreement, or any
Originator shall fail to perform or observe any term, covenant or agreement
contained in Section 4.01(g), (i) or (j)(iii) or 4.02 of the Receivables
Contribution and Sale Agreement; or
17
(c) Any representation or warranty made or deemed to be made by the
Seller or any Originator or the Collection Agent (or any of their officers)
under or in connection with this Agreement or any other Transaction
Document or any Seller Report or other information or report delivered
pursuant hereto shall prove to have been false or incorrect in any material
respect when made; or
(d) The Seller or any Originator shall fail to perform or observe any
other term, covenant or agreement contained in any Transaction Document on
its part to be performed or observed and any such failure shall remain
unremedied for seven Business Days after written notice thereof shall have
been given by the Agent to the Seller or such Originator; or
(e) The Seller or any Originator shall fail to pay any Debt, in the
case of the Seller, in excess of $5,000, and, in the case of such
Originator, in excess of $20,000,000, or any interest or premium thereon,
when due (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise) and such failure shall continue after the applicable
grace period, if any, specified in the agreement or instrument relating to
such Debt; or any other default under any agreement or instrument relating
to any such Debt, or any other event, shall occur and shall continue after
the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such default or event is to accelerate, or to
permit the acceleration of, the maturity of such Debt; or any such Debt
shall be declared to be due and payable or required to be prepaid (other
than by a regularly scheduled required prepayment), redeemed, purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt
shall be required to be made, in each case prior to the stated maturity
thereof; or
(f) Any Purchase or any reinvestment pursuant to Section 2.05 shall
for any reason, except to the extent permitted by the terms hereof, cease
to create, or any Eligible Asset shall for any reason cease to be, a valid
and perfected first priority undivided percentage ownership interest to the
extent of the pertinent Eligible Asset in each applicable Pool Receivable
and the Related Security and Collections with respect thereto; or
(g) (i) The Seller, any Originator or the Collection Agent shall
generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against the Seller, such Originator or the Collection
Agent seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating
to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee, or other similar official for it or for any substantial part of
its property and, if instituted against the Seller, such Originator or the
Collection Agent, either such proceeding shall not be stayed or dismissed
for 30 days or any of the actions sought in such proceeding (including,
without limitation, the entry of an order for relief against it or the
appointment of a receiver, trustee, custodian or other similar official for
it or for any substantial part of its property) shall occur; or (ii) the
Seller, such Originator or the
18
Collection Agent shall take any corporate action to authorize any of the
actions set forth in clause (i) above in this subsection (g); or
(h) The average of the Default Ratios for each of the three most
recently ended calendar months shall exceed 6%, or the average of the
Delinquency Ratios for each of the three most recently ended calendar
months shall exceed 10%; or
(i) (A) During any Investment Grade Period or any Below Investment
Grade Period, the aggregate undivided percentage interest for all Eligible
Assets and the "Eligible Assets" under and as defined in the Investor
Agreement shall exceed 95% for five consecutive Business Days or (B) during
any Collateral Account Period, the Net Receivables Pool Balance shall be
less than the Required Net Receivables Pool Balance for a period of two
consecutive Business Days or more after delivery of a Daily Seller Report
for any Settlement Period; or
(j) There shall have been any material adverse change in the financial
condition or operations of the Originators, taken as a whole, since
December 31, 2001, or there shall have occurred any event which materially
adversely affects the collectibility of the Pool Receivables, or there
shall have occurred any other event which materially adversely affects the
ability of the Seller or the Collection Agent to collect Pool Receivables
or the ability of the Seller or the Collection Agent to perform hereunder;
or
(k) Any material provision of any Transaction Document shall for any
reason cease to be a legal, valid and binding obligation of the Seller or
any Originator, as applicable, or the Seller or any Originator, as
applicable, shall so state in writing; or
(l) PolyOne shall cease to own directly or indirectly 100% of the
outstanding shares of stock of the Seller; or
(m) Any "Event of Default" under and as defined in the Credit
Agreement shall have occurred and be continuing; or
(n) All of Polyone's long-term public senior unsecured and
unguaranteed debt securities, if rated, are rated below BB- by S&P or rated
below Ba3 by Moody's or, if not rated, such securities are deemed to have a
rating below BB- in the sole discretion of the Agent; or
(o) The charter or by-laws of the Seller shall be amended,
supplemented or otherwise modified without the consent of the Agent (and
without the consent of the Group Managing Agents); or
(p) This Agreement shall cease to create in favor of the Agent, as
security for the Secured Obligations, a valid security interest in the
Collateral, or such security interest shall cease to be a perfected first
priority security interest upon the filing of the financing statements
referred to in Section 3.01(h); or
(q) There shall have occurred and be continuing any event that
constitutes an "Event of Investment Ineligibility" under and as defined in
the Investor Agreement;
19
then, and in any such event, the Agent shall at the request, or may with the
consent, of the Majority Investor Groups, by notice to the Seller, declare the
Commitment Termination Date to have occurred, whereupon the Commitment
Termination Date shall forthwith occur, without demand, protest or further
notice of any kind, all without any further actions on its part, which are
hereby expressly waived by the Seller; PROVIDED, HOWEVER, that the Majority
Investor Groups shall not be entitled to make any request of the Agent to
declare the Commitment Termination Date to have occurred as to any such event if
(x) the Agent has granted a waiver in respect of such event pursuant to Section
11.01 hereof so long as such waiver is effective or (y) no Members of any
Investor Group have made any Purchase of an Eligible Asset under this Agreement;
PROVIDED FURTHER, HOWEVER, that in the event of an actual or deemed entry of an
order for relief with respect to the Seller or any Originator under the Federal
Bankruptcy Code or the occurrence of any event described in Section 7.01 (g) of
the Investor Agreement, the Commitment Termination Date shall automatically
occur, without demand, protest or any notice of any kind, all of which are
hereby expressly waived by the Seller. Upon any occurrence of the Commitment
Termination Date, the Agent and the Banks shall have, in addition to all other
rights and remedies under this Agreement or otherwise, all other rights and
remedies provided under the UCC of the applicable jurisdiction and other
applicable laws, which rights shall be cumulative. Without limiting the
foregoing or the general applicability of Article IX hereof, any Bank may elect
to assign pursuant to Article IX hereof any Eligible Asset owned by such Bank to
an Eligible Assignee following the occurrence of any Event of Termination.
ARTICLE VIII
THE AGENT AND THE GROUP managing AGENTS
SECTION 8.01. AUTHORIZATION AND ACTION OF THE AGENT. Each Member
hereby appoints and authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement and the other
Transaction Documents and each other document furnished pursuant hereto as are
delegated to the Agent by the terms hereof or thereof, together with such powers
as are reasonably incidental thereto. As to any matters not expressly provided
for by this Agreement (including, without limitation, enforcement of the
Transaction Documents and such other documents), the Agent shall not be required
to exercise any discretion or take any action, but shall be required to act or
to refrain from acting (and shall be fully protected in so acting or refraining
from acting) upon the instructions or requests of the Group Managing Agents of
the Majority Investor Groups, and such instructions and requests shall be
binding upon all parties hereto and all Assignees; PROVIDED, HOWEVER, that the
Agent shall not be required to take any action which exposes the Agent to
personal liability or which is contrary to this Agreement or any other
Transaction Document or any other document furnished pursuant hereto or
applicable law. The Agent agrees to give to each Member prompt notice of each
notice given to it pursuant to the terms of this Agreement or any other
Transaction Document or any other document furnished pursuant hereto, and in the
case of each notice by the Seller to the Agent of each requested Purchase by the
Members pursuant to Section 2.02(a), the Agent agrees to use its reasonable best
efforts to give notice of such Purchase to each Member on the same day as such
notice by the Seller. The Agent hereby agrees to deliver promptly to each Member
each report, document, notice or other written communication required to be
delivered by or on behalf of the Seller or the Collection Agent or any
Originator to the Agent on behalf of the Members by the
20
terms and conditions of this Agreement and the other Transaction Documents (it
being understood that the Agent shall have no obligation to deliver, or cause to
be delivered, to any Member any such report, document, notice or other written
communication if the Seller or the Collection Agent or any Originator required
to deliver, or have delivered on its behalf, such report, document, notice or
other written communication fails to make or cause such delivery to the Agent).
SECTION 8.02. AUTHORIZATION AND ACTION OF THE GROUP MANAGING AGENTS.
Each Member of each Investor Group hereby appoints and authorizes the Group
Managing Agent of such Investor Group to take such action as agent on its behalf
and to exercise such powers under this Agreement and the other Transaction
Documents and each other document furnished pursuant hereto as are delegated to
such Group Managing Agent (whether in its capacity as Group Managing Agent
hereunder or as Managing Agent under any other Transaction Document) by the
terms hereof or thereof, together with such powers as are reasonably incidental
thereto. As to any matters not expressly provided for by this Agreement
(including, without limitation, enforcement of such Transaction Documents and
such other instruments and documents), no Group Managing Agent shall be required
to exercise any discretion or take any action, but each Group Managing Agent
shall be required to act or to refrain from acting (and shall be fully protected
in so acting or refraining from acting) upon the instructions or requests of the
Members of such Group Managing Agent's Investor Group, and such instructions and
requests shall be binding upon all parties hereto and all Assignees; PROVIDED,
HOWEVER, that no Group Managing Agent shall be required to take any action which
exposes such Group Managing Agent to personal liability or which is contrary to
this Agreement or any other Transaction Document or any other document furnished
pursuant hereto or applicable law. The Group Managing Agent of each Investor
Group agrees to give to each Member of such Investor Group prompt notice of each
notice given to it pursuant to the terms of this Agreement or any other
Transaction Document or any other document furnished pursuant hereto, and in the
case of each notice by the Seller or the Administrative Agent to such Group
Managing Agent of each requested Purchase by the Members of such Group Managing
Agent's Investor Group pursuant to Section 2.02(a), such Group Managing Agent
agrees to use its reasonable best efforts to give notice of such Purchase to
each such Member of such Investor Group on the same day as it receives such
notice. The Group Managing Agent of each Investor Group hereby agrees to deliver
promptly to each Member of such Investor Group each report, document, notice or
other written communication required to be delivered by or on behalf of the
Seller, the Collection Agent, the Agent or any Originator to such Group Managing
Agent on behalf of such Members by the terms and conditions of this Agreement
and the other Transaction Documents (it being understood that such Group
Managing Agent shall have no obligation to deliver, or cause to be delivered, to
any such Member any such report, document, notice or other written communication
if the Seller, the Collection Agent, the Agent or any Originator required to
deliver, or have delivered on its behalf, such report, document, notice or other
written communication fails to make or cause such delivery to such Group
Managing Agent).
SECTION 8.03. AGENT'S AND GROUP MANAGING AGENTS' RELIANCE, ETC.
Neither the Agent nor any Group Managing Agent nor any of their directors,
officers, agents or employees shall be liable for any action taken or omitted to
be taken by it or them as Agent or Group Managing Agent, respectively, under or
in connection with this Agreement or any other Transaction Document (including,
without limitation, the Agent's servicing, administering or
21
collecting Pool Receivables as Collection Agent pursuant to Section 6.01),
except for its or their own gross negligence or willful misconduct. Without
limiting the foregoing, the Agent or each Group Managing Agent, as applicable:
(i) may consult with legal counsel (including counsel for the Seller,
the Collection Agent or any Originator), independent public accountants and
other experts selected by it and shall not be liable for any action taken
or omitted to be taken in good faith by it in accordance with the advice of
such counsel, accountants or experts;
(ii) makes no warranty or representation to the Banks or any other
Indemnified Party and shall not be responsible to any of them for any
statements, warranties or representations (whether written or oral) made in
or in connection with this Agreement or any other Transaction Document or
any other document delivered pursuant hereto;
(iii) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of
this Agreement or any other Transaction Document or any other document
delivered pursuant hereto on the part of the Seller, the Collection Agent
or any Originator or to inspect the property (including the books and
records) of the Seller, the Collection Agent or any Originator;
(iv) shall not be responsible to any Bank or any other Indemnified
Party for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any other
Transaction Document or any other instrument or document furnished pursuant
hereto, or the perfection, priority or value of any ownership interest or
security interest created or purported to be created hereunder or under the
Receivables Contribution and Sale Agreement; and
(v) shall incur no liability under or in respect of this Agreement or
any other Transaction Document by acting upon any notice (including notice
by telephone), consent, certificate or other instrument or writing (which
may be by facsimile, telegram, cable or telex) believed by it to be genuine
and signed or sent by the proper party or parties.
SECTION 8.04. RIGHTS AND POWERS. With respect to any Eligible Asset
owned by it, CNAI and each Group Managing Agent shall have the same rights and
powers under this Agreement as would any Member and may exercise the same as
though it were not the Agent or a Group Managing Agent, as applicable. CNAI and
its Affiliates and each Group Managing Agent and each respective Affiliate of
such Group Managing Agent may generally engage in any kind of business with the
Seller or any Originator or any Obligor, any of their respective Affiliates and
any Person who may do business with or own securities of the Seller or any
Originator or any Obligor or any of their respective Affiliates, all as if CNAI
or such Group Managing Agent were not the Agent or a Group Managing Agent,
respectively, and without any duty to account therefor to the Banks.
SECTION 8.05. PURCHASE DECISIONS. Each Member acknowledges that it
has, independently and without reliance upon the Agent, any of its Affiliates or
any Group Managing
22
Agent or any of their respective Affiliates or any other Indemnified Party and
based on such documents and information as it has deemed appropriate, made its
own evaluation and decision to enter into this Agreement and, if it so
determines, to purchase undivided ownership interests in Pool Receivables
hereunder. Each Member also acknowledges that it will, independently and without
reliance upon the Agent, any of its Affiliates or any Group Managing Agent or
any of their respective Affiliates or any other Indemnified Party and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own decisions in taking or not taking action under this
Agreement or any other Transaction Document.
SECTION 8.06. INDEMNIFICATION. The Members of each Investor Group
agree to indemnify the Agent and the Group Managing Agent of such Investor Group
(to the extent not reimbursed by the Seller or any Originator), ratably
according to the respective amounts of Capital of their respective Eligible
Assets (or, if no Eligible Asset is at that time owned by them, ratably
according to their respective Bank Commitments), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Agent or such Group Managing
Agent in any way relating to or arising out of this Agreement or the Investor
Agreement or any other Transaction Document or any other document furnished
pursuant hereto or thereto or any action taken or omitted by the Agent or such
Group Managing Agent under this Agreement or the Investor Agreement or any other
Transaction Document or any such instrument or document, PROVIDED that no Member
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Agent's or such Group Managing Agent's gross negligence or
willful misconduct. Without limitation of the foregoing, each Member agrees to
reimburse the Agent, ratably according to the respective amounts of Capital of
their respective Eligible Assets (or, if no Eligible Asset is at that time owned
by them, ratably according to their respective Bank Commitments), promptly upon
demand for any out-of-pocket expenses (including counsel fees) incurred by the
Agent in connection with the administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement
or the Investor Agreement or any other Transaction Document or any other
document furnished pursuant hereto or thereto.
SECTION 8.07. SUCCESSOR AGENT. The Agent may resign at any time by
giving written notice thereof to the Group Managing Agents and the Seller and
may be removed at any time with or without cause by the Majority Investor
Groups. Upon any such resignation or removal, the Group Managing Agents shall
have the right to appoint a successor Agent. If no successor Agent shall have
been so appointed by the Group Managing Agents, and shall have accepted such
appointment, within 30 days after the retiring Agent's giving of notice of
resignation or the removal of the retiring Agent by the Majority Investor
Groups, then the retiring Agent may, on behalf of the Members, appoint a
successor Agent, which shall be a commercial bank organized under the laws of
the United States or of any State thereof and having a combined capital and
surplus of at least $250,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent and upon the execution and filing or
recording of such financing statements, or amendments thereto, and such other
instruments or notices, as may be necessary or desirable, or as the Group
Managing Agents may request, in order to continue the perfection of the
ownership and security interests granted or purported to be
23
granted by the Transaction Documents, such successor Agent shall succeed to and
become vested with all the rights, powers, discretion, privileges and duties of
the retiring Agent, and the retiring Agent shall be discharged from its duties
and obligations under the Transaction Documents. After any retiring Agent's
resignation or removal hereunder as Agent shall have become effective, the
provisions of this Article VIII shall inure to its benefit to any actions taken
or omitted to be taken by it while it was Agent under this Agreement.
SECTION 8.08. AUTHORIZATIONS AND ACTIONS WITHIN INVESTOR GROUPS. Any
authorization, consent or waiver that is to be taken by any Investor Group
hereunder shall be taken by the Group Managing Agent of such Investor Group on
its behalf at the direction or with the consent of the Members of such Investor
Group. The specific manner in which such direction or consent shall be given or
authorized with respect to any Investor Group shall be determined by the Members
of such Investor Group. Any action with respect to the removal or replacement of
any Group Managing Agent shall be determined by the Members of the Investor
Group of such Group Managing Agent. Any authorization, consent, waiver or other
action that is to be taken by the Majority Investor Groups hereunder shall be
taken by the Group Managing Agents representing such Majority Investor Groups
unless otherwise expressly stated herein.
ARTICLE IX
ASSIGNMENT of eligible assets
SECTION 9.01. ASSIGNMENT. (a) Each Member may, upon the consent of the
Agent and the Seller, which consent shall not be unreasonably withheld, assign
to any Eligible Assignee or any other Member, and any such assignee may assign
to any other such assignee, any Eligible Asset. Upon any such assignment, (i)
the Assignee thereof shall become the Eligible Asset Owner of such portion of
such Eligible Asset for all purposes of this Agreement and (ii) the Eligible
Asset Owner assignor thereof shall relinquish its rights with respect to such
portion of such Eligible Asset for all purposes of this Agreement. Such
assignment shall be upon such terms and conditions as the assignor and the
Assignee of such portion of such Eligible Asset may mutually agree; the parties
thereto shall deliver to the Agent an Assignment, duly executed by such parties;
and such assignor 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 portion of such Eligible Asset, and to enable the
Assignee to exercise or enforce any rights hereunder or under the Certificate.
The Agent shall provide notice to the Seller, the assigning Member's Group
Managing Agent and each Member of the assigning Member's Investor Group of any
assignment of any portion of any Eligible Asset hereunder.
(b) By executing and delivering an Assignment (in the case of an
assigning Member) and executing and accepting an Assignment (in the case of an
Assignee), the assigning Member thereunder and the Assignee thereunder confirm
to and agree with each other and the other parties hereto as follows: (i) other
than as provided in such Assignment, such assigning Member makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or any other Transaction Document or any other document furnished
pursuant hereto or the execution,
24
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or any other Transaction Document or any other document furnished
pursuant hereto, or the perfection, priority or value of any ownership interest
or security interest created or purported to be created hereunder or under the
Receivables Contribution and Sale Agreement; (ii) such assigning Member makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Seller or any Originator or the Collection Agent or
the performance or observance by the Seller or any Originator or the Collection
Agent of any of its obligations under this Agreement or any other Transaction
Document or any other document furnished pursuant hereto; (iii) such Assignee
confirms that it has received copies of this Agreement and the other Transaction
Documents, together with such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and to purchase such Eligible Asset; (iv) such Assignee will,
independently and without reliance upon the Agent, any of its Affiliates, such
assigning Member, any Group Managing Agent or any other Member of any Investor
Group or any Indemnified Party and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Transaction
Documents and the other instruments and documents furnished pursuant hereto; (v)
such Assignee appoints and authorizes the Agent and the Group Managing Agent of
such Assignee's Investor Group to take such action as agent on its behalf and to
exercise such powers and discretion under this Agreement and the other
Transaction Documents and the other instruments and documents furnished pursuant
hereto as are delegated to the Agent and the Group Managing Agent, respectively,
by the terms hereof and thereof, together with such powers and discretion as are
reasonably incidental thereto; (vi) such Assignee appoints as its agent the
Collection Agent from time to time designated pursuant to Section 6.01 to
enforce its respective rights and interests in and under the Pool Receivables
and the Related Security and Collections with respect thereto and the related
Contracts; and (vii) such Assignee agrees that it will not institute against any
Investor any proceeding of the type referred to in Section 7.01(g) so long as
any promissory notes issued by such Investor shall be outstanding or there shall
not have elapsed one year plus one day since the last day on which any such
promissory notes shall have been outstanding.
SECTION 9.02. ASSIGNMENT OF RIGHTS AND OBLIGATIONS. (a) Each Member
may assign to any Eligible Assignee all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Bank Commitment and of the portion of the Eligible Assets owned
by it); PROVIDED, HOWEVER, that (i) each such assignment shall be a constant,
and not a varying, percentage of such Member's rights and obligations under this
Agreement and the portion of the Eligible Assets owned by it, (ii) in the case
of any assignment by any Member that is not assigning pursuant thereto all of
its right and obligations under this Agreement, the amount of the Bank
Commitment being assigned pursuant to each such assignment (determined as of the
date of the Assignment and Acceptance with respect to such assignment) shall be
at least $1,000,000 (iii) each such assignment shall be to an Eligible Assignee,
(iv) the parties to each such assignment shall execute and deliver to the Agent,
for its acceptance and recording in the Register, an Assignment and Acceptance,
together with a processing and recording fee of $2,500, (v) the consent of the
Agent shall first have been obtained and (vi) the Seller shall execute and
deliver to the Agent for the account of such Assignee a Certificate in form and
substance satisfactory to the Agent. Upon such execution, delivery and
acceptance, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be the later of (x) the date the Agent
receives the executed
25
Assignment and Acceptance and (y) the date of such Assignment and Acceptance,
(I) the assignee thereunder shall be a party hereto and shall have all the
rights and obligations of a Member hereunder and (II) the assigning Member
shall, to the extent that rights and obligations hereunder have been assigned by
it pursuant to such assignment and acceptance, relinquish its rights and be
released from its obligations under this Agreement.
(b) By executing and delivering an Assignment and Acceptance, the
assigning Member and the Assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, the assigning Member makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
any other Transaction Document or any other document furnished pursuant hereto
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of this Agreement or any other Transaction Document or any other
document furnished pursuant hereto, or the perfection, priority or value of any
ownership interest or security interest created or purported to be created
hereunder or under the Receivables Contribution and Sale Agreement; (ii) the
assigning Member makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Seller or any
Originator or the performance or observance by the Seller or any Originator of
any of its obligations under this Agreement or any other Transaction Document or
any other document furnished pursuant hereto; (iii) such Assignee confirms that
it has received copies of this Agreement and the other Transaction Documents,
together with such other documents and information as it has deemed appropriate
to make its own analysis and decision to enter into such Assignment and
Acceptance; (iv) such Assignee will, independently and without reliance upon the
Agent, any of its Affiliates, the assigning Member or any other Member or any
former Member or other Indemnified Party and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
decisions in taking or not taking action under this Agreement and the other
Transaction Documents and the other documents furnished pursuant hereto; (v)
such Assignee confirms that it is an Eligible Assignee; (vi) such Assignee
appoints and authorizes the Agent and the Group Managing Agent of the applicable
Investor Group to take such action as agent on its behalf and to exercise such
powers and discretion under this Agreement and the other Transaction Documents
and the other instruments and documents furnished pursuant hereto as are
delegated to the Agent and such Group Managing Agent, respectively, by the terms
hereof and thereof, together with such powers and discretion as are reasonably
incidental thereto; (vii) such Assignee appoints as its agent the Collection
Agent from time to time designated pursuant to Section 6.01 to enforce its
respective rights and interests in and under the Pool Receivables and the
Related Security and Collections with respect thereto and the related Contracts;
and (viii) such Assignee agrees that it will perform in accordance with their
terms all of the obligations which by the terms of this Agreement are required
to be performed by it as a Member.
(c) The Agent shall maintain at its office referred to in Section
11.02 a copy of each Assignment and Acceptance delivered to and accepted by it
and a register (the "REGISTER") for the recordation of the names and addresses
of the Group Managing Agent of each Investor Group and the Members of such
Investor Group and the Bank Commitment of, and the portion of each Eligible
Asset owned by, each Member of such Investor Group from time to time, which
Register shall be available for inspection by the Seller and the Members at any
reasonable time and from time to time upon reasonable prior notice. The entries
in the Register
26
shall be conclusive and binding for all purposes, absent manifest error, and the
Seller, the Collection Agent, the Members, the Group Managing Agents and the
Agent may treat each Person whose name is recorded in the Register as a Member
hereunder for all purposes of this Agreement.
(d) Upon its receipt of an Assignment and Acceptance executed by any
assigning Member and an assignee representing that it is an Eligible Assignee,
the Agent shall, if such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit B hereto, (i) accept such Assignment and
Acceptance and (ii) give prompt notice thereof to the Seller and the Collection
Agent, the assigning Member's Group Managing Agent and each Member of the
assigning Member's Investor Group.
SECTION 9.03. ANNOTATION OF CERTIFICATE. The Agent shall annotate the
Certificate for each assigning Member to reflect the assignment made by such
Member pursuant to Section 9.01 or 9.02 or otherwise.
ARTICLE X
INDEMNIFICATION
SECTION 10.01. INDEMNITIES BY THE SELLER. Without limiting any other
rights which any Indemnified Party may have hereunder or under applicable law,
the Seller hereby agrees to indemnify each Indemnified Party 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 referred to as "INDEMNIFIED AMOUNTS") awarded against or
incurred by any of them arising out of or as a result of this Agreement or the
use of proceeds of Purchases or the ownership of Eligible Assets or in respect
of any Receivable or any Contract, excluding, however, (a) Indemnified Amounts
to the extent resulting from gross negligence or willful misconduct on the part
of such Indemnified Party, (b) recourse (except as otherwise specifically
provided in this Agreement) for uncollectible Receivables or (c) any income
taxes incurred by any of them arising out of or as a result of this Agreement or
the ownership of Eligible Assets or in respect of any Receivable or any
Contract. Without limiting or being limited by the foregoing, the Seller shall
pay on demand to each Indemnified Party any and all amounts necessary to
indemnify such Indemnified Party for Indemnified Amounts relating to or
resulting from:
(i) the creation of an undivided percentage ownership interest in any
Receivable which is not at the date of the creation of such interest an
Eligible Receivable or which thereafter ceases to be an Eligible
Receivable;
(ii) reliance on any representation or warranty made by the Seller or
any Originator (or any of its officers) under or in connection with this
Agreement or any other Transaction Document or any Seller Report or any
other information or report delivered by the Seller or any Originator
pursuant hereto, which shall have been false or incorrect in any material
respect when made or deemed made;
27
(iii) the failure by the Seller or any Originator to comply with any
applicable law, rule or regulation with respect to any Pool Receivable or
the related Contract, or the nonconformity of any Pool Receivable or the
related Contract with any such applicable law, rule or regulation;
(iv) the failure to vest continuously in the Eligible Asset Owner of
an Eligible Asset an undivided percentage ownership interest, to the extent
of each Eligible Asset, in the Receivables in, or purporting to be in, the
Receivables Pool and the Related Security and Collections in respect
thereof, free and clear of any Adverse Claim; or the failure of the Seller
to have obtained a first priority perfected ownership interest in the Pool
Receivables and the Related Security and Collections with respect thereto
transferred or purported to be transferred to the Seller under the
Receivables Contribution and Sale Agreement, free and clear of any Adverse
Claim;
(v) the failure by the Seller to file, or any delay by the Seller in
filing, financing statements or other similar instruments or documents
under the UCC of any applicable jurisdiction or other applicable laws with
respect to any Receivables in, or purporting to be in, the Receivables Pool
and the Related Security and Collections in respect thereof, whether at the
time of any Purchase or reinvestment or at any subsequent time;
(vi) any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable
in, or purporting to be in, the Receivables Pool (including, without
limitation, a defense based on such Receivable or the related Contract not
being a legal, valid and binding obligation of such Obligor enforceable
against it in accordance with its terms), or any other claim resulting from
the sale of the merchandise or services related to such Receivable or the
furnishing or failure to furnish such merchandise or services;
(vii) any failure of the Seller or any Originator, so long as such
Originator is Collection Agent, to perform its duties or obligations
hereunder or under the Investor Agreement or any other Transaction Document
or to perform its duties or obligations under any Contract;
(viii) any products liability claim arising out of or in connection
with merchandise, insurance or services which are the subject of any
Contract;
(ix) any investigation, litigation or proceeding related to this
Agreement or any other Transaction Document or the use of proceeds of
Purchases or the ownership of Eligible Assets or in respect of any
Receivable or any Contract;
(x) the commingling of collections of Pool Receivables at any time
with other funds; PROVIDED that, without in any way limiting the foregoing
indemnity, such indemnity is not intended to restrict the Seller from
servicing Receivables as the Collection Agent pursuant to Article VI of
this Agreement; or
28
(xi) any claim brought by any Person other than an Indemnified Party
arising from any activity by any Originator or any Affiliate of such
Originator in servicing, administering or collecting any Pool Receivables.
(xii) any action or omission by the Seller or any Originator, so long
as such Originator is Collection Agent, reducing or impairing the rights of
any Owner of an Eligible Asset under this Agreement, any other Transaction
Document or any other instrument or document furnished pursuant hereto or
thereto or with respect to any Pool Receivable;
(xiii) any cancellation or modification of a Pool Receivable, the
related Contract or any Related Security, whether by written agreement,
verbal agreement, acquiescence or otherwise;
(xiv) any investigation, litigation or proceeding related to or
arising from this Agreement, any other Transaction Document or any document
furnished pursuant hereto or thereto, or any transaction contemplated by
this Agreement or any Contract or the use of proceeds from any Purchase or
reinvestment pursuant to this Agreement, or the ownership of, or other
interest in, any Receivable, the related Contract or Related Security;
(xv) the existence of any Adverse Claim against or with respect to any
Pool Receivable, the related Contract or the Related Security or
Collections with respect thereto;
(xvi) any failure by the Seller to pay when due any taxes, including
without limitation sales, excise or personal property taxes, payable by the
Seller in connection with any Receivable or the related Contract or any
Related Security with respect thereto;
(xvii) to the extent not covered by the foregoing clauses, the
occurrence and continuance of any Event of Termination other than an Event
of Termination arising under Section 7.01(h).
ARTICLE XI
MISCELLANEOUS
SECTION 11.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement (including, without limitation, any provision of the
Investor Agreement which is incorporated herein by reference) nor consent to any
departure by the Seller therefrom, shall in any event be effective unless the
same shall be in writing and signed by the Agent and the Group Managing Agents,
and then such amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; PROVIDED,
HOWEVER, that no amendment, waiver or consent shall (a) unless in writing and
signed by all the Banks, do any of the following at any time: (i) amend the
definition of Eligible Receivable, Defaulted Receivable or Delinquent Receivable
or modify the then existing Concentration Limit or any Special Concentration
Limit, (ii) amend, modify or waive any provision of this Agreement in any way
29
which would (A) reduce the amount of Capital or Yield that is payable on account
of any Eligible Asset or delay any scheduled date for payment thereof, (B)
impair any rights expressly granted to an assignee or participant under this
Agreement, (C) reduce fees payable by the Seller to the Agent or the Banks or
delay the dates on which such fees are payable, (D) release, sell, convey or
otherwise dispose of all or substantially all of the Receivables, Contracts or
Related Security or (E) extend the Commitment Termination Date, (iii) agree to a
different Assignee Rate pursuant to the final proviso in the definition of
"Assignee Rate" in the Investor Agreement or (iv) amend or waive Section 7.01(g)
of the Investor Agreement or (b) without the prior written consent of the
Majority Investor Groups, (i) amend the definition of Default Ratio, Delinquency
Ratio or Net Receivables Pool Balance, (ii) amend the Events of Termination to
increase the maximum permitted Default Ratio or Delinquency Ratio, (iii) (A)
waive violations of the Default Ratio or the Delinquency Ratio that exceed the
maximum permitted levels of such ratios (i) for more than two consecutive months
or (ii) by more than 10% or (B) waive a violation of the cross default provision
set forth in Section 7.01(e) or (iv) amend this Agreement or the Investor
Agreement to increase the aggregate Bank Commitments or the aggregate Purchase
Limits, respectively. No failure on the part of any Member or any Indemnified
Party to exercise, and no delay in exercising, any right hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right. Without limiting the foregoing, each Member is hereby authorized by
the Seller upon the occurrence and during the continuance of an Event of
Termination or event which, with the giving of notice or lapse of time or both,
would constitute any Event of Termination, and from time to time, to the fullest
extent permitted by law, to setoff 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 such Member to or for the credit or the
account of the Seller against any and all of the obligations of the Seller now
or hereafter existing under this Agreement to such Member or, if such Member is
Citibank, to the Agent or CNAI or any Affiliate thereof, irrespective of whether
or not any formal demand shall have been made under this Agreement and although
such obligations may be unmatured. Each Member agrees promptly to notify the
Seller after any such setoff and application; PROVIDED, HOWEVER, that the
failure to give such notice shall not affect the validity of such setoff and
application. The rights of each Member under this Section 11.01 are in addition
to other rights and remedies (including, without limitation, other rights of
setoff) which such Member may have.
SECTION 11.02. NOTICES, ETC. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in writing and
mailed or delivered, as to each party hereto, at its address set forth under its
name on the signature pages hereof, or in the case of any Member that is not an
Original Bank, in the Assignment and Acceptance pursuant to which such Member
became a Member hereunder, or at such other address as shall be designated by
such party in a written notice to the other parties hereto. Notices and
communications shall be effective when received, in each case addressed as
aforesaid.
SECTION 11.03. NO WAIVER; REMEDIES. No failure on the part of the
Agent, the Group Managing Agents or the Members or any other Indemnified Party
to exercise, and no delay in exercising, any of their respective rights
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder preclude any other or further exercise thereof
or the exercise of any other right. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.
30
SECTION 11.04. BINDING EFFECT; ASSIGNABILITY. This Agreement shall
become effective as of the Restatement Effective Date when all the conditions
set forth in Section 3.01 are satisfied or waived, and thereafter shall be
binding upon and inure to the benefit of the Seller, the Collection Agent, each
Member, each Group Managing Agent, each Eligible Asset Owner and the Agent and
their respective successors and assigns, except that neither the Seller nor the
Collection Agent shall have the right to assign its rights or obligations
hereunder or any interest herein without the prior written consent of the Group
Managing Agents, the Members and the Agent. This Agreement shall create and
constitute the continuing obligation 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 for the Eligible Assets, as all accrued Yield and
Program Fees shall be paid and no Capital of any Eligible Asset shall be
outstanding; PROVIDED, HOWEVER, that rights and remedies with respect to the
provisions of Sections 2.11, 10.01, 11.06, 11.07 and 11.08 shall be continuing
and shall survive any termination of this Agreement.
SECTION 11.05. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE
EXTENT THAT THE PERFECTION OF THE INTERESTS OF THE AGENT IN THE RECEIVABLES, OR
REMEDIES HEREUNDER, IN RESPECT THEREOF, ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK.
SECTION 11.06. COSTS, EXPENSES AND TAXES. (a) In addition to the
rights of indemnification granted to the Agent, the Group Managing Agents, the
Members and the other Indemnified Parties and their respective Affiliates under
Article X hereof, the Seller agrees to pay on demand all costs and expenses in
connection with the syndication of the Bank Commitments hereunder and the
preparation, execution, delivery and administration (including periodic
auditing) of this Agreement and the other Transaction Documents and the other
documents to be delivered hereunder, including, without limitation, the
reasonable fees and out-of-pocket expenses of counsel for CNAI, the Agent, each
Group Managing Agent and their respective Affiliates with respect thereto and
with respect to advising CNAI, the Agent, each Group Managing Agent and their
respective Affiliates as to their respective rights and remedies under this
Agreement and each other Transaction Document. The Seller further agrees to pay
on demand all costs and expenses, if any (including, without limitation,
reasonable counsel fees and expenses), in connection with the enforcement
(whether through negotiations, legal proceedings or otherwise) of this Agreement
and the other Transaction Documents and the other documents to be delivered
hereunder, including, without limitation, reasonable counsel fees and expenses
in connection with the enforcement of rights under this Section 11.06(a). A
certificate as to the amount of such costs and expenses setting forth the basis
thereof in reasonable detail and submitted to the Seller shall be conclusive and
binding for all purposes, absent manifest error.
(b) In addition, the Seller shall pay any and all stamp and other
taxes (excluding income taxes) and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of this Agreement
each other Transaction Document or the other documents to be delivered
hereunder, 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. A certificate as to the amount of such costs and fees
setting forth the basis thereof in reasonable detail and submitted to the Seller
shall be conclusive and binding for all purposes, absent manifest error.
31
SECTION 11.07. NO PROCEEDINGS. (a) Each of the Seller, PolyOne, the
Agent, each Group Managing Agent, each Eligible Asset Owner, each assignee of an
Eligible Asset or any interest therein and each entity which enters into a
commitment to purchase Eligible Assets or interests therein hereby agrees that
it will not institute against any Investor any proceeding of the type referred
to in clause (i) of Section 7.01(g) so long as any commercial paper issued by
such Investor shall be outstanding or there shall not have elapsed one year plus
one day since the last day on which any such commercial paper shall have been
outstanding.
(b) Each of the parties hereto hereby agree that they will not
institute against the Seller any proceeding of the type referred to in clause
(i) of Section 7.01(g).
(c) Each of the Seller and PolyOne hereby agrees that, in connection
with the Transaction Documents and the transactions contemplated thereby, none
of the Indemnified Parties shall be liable to the Seller or PolyOne except to
the extent of such Indemnified Party's own gross negligence or willful
misconduct or have any liability for special, indirect, consequential or
punitive damages arising out of or otherwise relating to the Transaction
Documents or any of the transactions contemplated by the Transaction Documents.
SECTION 11.08. CONFIDENTIALITY. (a) Except to the extent otherwise
required by applicable law, rule, regulation or judicial process, the Seller
agrees to maintain the confidentiality of this Agreement, the Investor
Agreement, the Receivables Contribution and Sale Agreement, Consent and
Agreement, the Fee Letter (and all drafts thereof) and all non-public
information delivered in connection herewith in communications with third
parties and otherwise; PROVIDED, HOWEVER, that the Agreement, the Receivables
Contribution and Sale Agreement, Consent and Agreement, the Fee Letter and any
such information may be disclosed to third parties to the extent such disclosure
is (i) limited in scope to the provisions of Articles V, VII, X and, to the
extent defined terms are used in Articles V, VII and X, such terms defined in
Article I of this Agreement and (ii) made pursuant to a written agreement of
confidentiality in form and substance reasonably satisfactory to the Agent;
PROVIDED FURTHER, HOWEVER, that the Agreement, the Investor Agreement, the
Receivables Contribution and Sale Agreement, Consent and Agreement and the Fee
Letter may be disclosed to the Seller's legal counsel pursuant to an agreement
of the type referred to in clause (ii), above; and PROVIDED FURTHER, HOWEVER,
that the Seller shall have no obligation of confidentiality in respect of any
information which may be generally available to the public or becomes available
to the public through no fault of the Seller.
(b) Each Bank understands that each of this Agreement, the Receivables
Contribution and Sale Agreement, Consent and Agreement and the Fee Letter is a
confidential document and no Bank will disclose it to any other Person without
the Agent's prior written consent other than (i) to such Bank's Affiliates and
their and their Affiliates' officers, directors, employees, agents, counsel,
auditors and advisors and then only on a confidential basis, (ii) to actual or
prospective Assignees, and then only if such Assignee has agreed in writing to
maintain such information on a confidential basis, (iii) to rating agencies,
(iv) as required by any law, rule or regulation or judicial process or (v) as
requested or required by any state, federal or foreign authority or examiner
regulating banks or banking.
(c) Neither the Agent, any Group Managing Agent, or any Bank shall
disclose any Confidential Information to any Person without the consent of the
Seller, other than (i) to the
32
Agent's, such Group Managing Agent's or such Bank's Affiliates and their and
their Affiliates' officers, directors, employees, agents, counsel, auditors and
advisors and then only on a confidential basis, (ii) to actual or prospective
Assignees, and then only if such Assignee has agreed in writing to maintain such
Confidential Information on a confidential basis, (iii) to rating agencies, (iv)
as required by any law, rule or regulation or judicial process and (v) as
requested or required by any state, federal or foreign authority or examiner
regulating banks or banking.
SECTION 11.09. JURISDICTION, ETC. (a) Each of the parties hereto
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Transaction Documents to which it is a party, or
for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such Federal court. Each of the
parties hereto hereby agrees that service of process in any such action or
proceeding may be effected by mailing a summons and complaint to it at its
address specified in Section 11.02 by registered mail, return receipt requested,
or in any other manner permitted by applicable law. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement shall affect any
right that any party may otherwise have to bring any action or proceeding
relating to this Agreement or any of the other Transaction Documents in the
courts of any other jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally waives,
to the fullest extent it may legally and effectively do so, any objection that
it may now or hereafter have to the laying of venue of any action or proceeding
arising out of or relating to this Agreement or any of the other Transaction
Documents to which it is a party in any New York State or Federal court. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.
SECTION 11.10. GRANT OF A SECURITY INTEREST. Section 11.10 of the
Investor Agreement is hereby incorporated herein by this reference, except that
each reference therein to an "Investor" or to an "Owner" shall be deemed to be a
reference to a Bank and each reference therein to an "Event of Investment
Ineligibility" shall be deemed to be a reference to an Event of Termination.
SECTION 11.11. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and all of which when taken together shall constitute
one and the same agreement. Delivery by telecopier of an executed counterpart of
a signature page to this Agreement shall be effective as delivery of an original
executed counterpart of this Agreement.
SECTION 11.12. INTENT OF THE PARTIES. It is the intention of the
parties hereto that each Purchase and reinvestment shall convey to the Agent for
the benefit of each Member, to the extent of its Eligible Assets, an undivided
ownership interest in the Pool Receivables and the
33
Related Security and Collections in respect thereof and that such transaction
shall constitute a purchase and sale and not a secured loan for all purposes
other than for federal income tax purposes. If, notwithstanding such intention,
the conveyance of the Eligible Assets from the Seller to the Agent for the
benefit of any Member shall ever be recharacterized as a secured loan and not a
sale, it is the intention of the parties hereto that this Agreement and the
Certificate of such Member, shall constitute a security agreement under
applicable law, and that the Seller shall be deemed to have granted to the Agent
for the benefit of such Member, to the extent of such Member's Eligible Assets,
a duly perfected first priority security interest in and to all of the Seller's
right, title and interest in and to the Pool Receivables, whether now owned or
hereafter acquired, and the Related Security and Collections in respect thereof
from time to time and all cash and non-cash proceeds in respect thereof, free
and clear of Adverse Claims. For such purpose, the Seller hereby grants to the
Agent for the benefit of each Member, to the extent of such Member's Eligible
Assets, a duly perfected first priority security interest in all of the Seller's
right, title and interest in and to the Pool Receivables, whether now owned or
hereafter acquired, and the Related Security and Collections with respect
thereto from time to time and all cash and non-cash proceeds in respect thereof.
SECTION 11.13. ENTIRE AGREEMENT. This Agreement and the other
Transaction Documents contain a final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire agreement and understanding among the parties hereto
with respect to the subject matter hereof and supersede all prior agreements and
understandings, written or oral, relating to the subject matter hereof.
SECTION 11.14. SEVERABILITY OF PROVISIONS. 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 hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
SECTION 11.15. WAIVER OF JURY TRIAL. Each of the parties hereto
irrevocably waives all right to trial by jury in any action, proceeding or
counterclaim (whether based on contract, tort or otherwise) arising out of or
relating to this Agreement or any of the other Transaction Documents, the
Purchases or the actions of the Agent, any Group Managing Agent or any other
Indemnified Party in the negotiation, administration, performance or enforcement
hereof or thereof.
[THE REST OF THIS PAGE IS LEFT INTENTIONALLY BLANK]
34
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers (or agents) thereunto duly authorized, as
of the date first above written.
POLYONE FUNDING CORPORATION
By:______________________________
Name:
Title:
33587 Walker Road
Avon Lake, Ohio 44012
(Lorain County)
Attn: Treasurer
POLYONE CORPORATION
By:______________________________
Name:
Title:
33587 Walker Road
Avon Lake, Ohio 44012
(Lorain County)
Attn: Treasurer
CITICORP NORTH AMERICA, INC.,
a Group Managing Agent and as Agent
By:______________________________
Name:
Title:
450 Mamaroneck Avenue
Harrison, New York 10528
Attention: Corporate Asset
Funding Department
Facsimile No.: (914) 899-7890
THE ORIGINAL BANK
BANK COMMITMENT BANK NAME
$250,000,000 CITIBANK, N.A.
By:______________________________
Name:
Title:
450 Mamaroneck Avenue
Harrison, New York 10528
Attention: Global Securitization
Facsimile No.: (914) 899-7890
EXHIBIT A
ASSIGNMENT
Dated as of _______ __, ____
Reference is made to the Fourth Amended and Restated Parallel Purchase
Commitment dated as of April 10, 2002 (the "AGREEMENT") among PolyOne Funding
Corporation (the "SELLER"), PolyOne Corporation ("POLYONE"), individually and as
Collection Agent (the "COLLECTION AGENT"), Citibank, N.A. (the "ORIGINAL BANK")
and Citicorp North America, Inc., as Group Managing Agent and as agent for
itself, the other Group Managing Agents, the Banks and the Eligible Asset Owners
as defined therein (in such capacity, the "Agent"). Terms defined in the
Agreement are used herein as therein defined.
_______________ (the "ASSIGNOR") and _______________ (the "ASSIGNEE")
agree as follows:
1. In consideration of the payment of $__________, being the existing
[aggregate] Capital of the Eligible Asset[s] referred to below, and of
$__________, being the [aggregate] unpaid accrued Yield for such Eligible Asset
[s], receipt of which payment is hereby acknowledged, the Assignor hereby
assigns to the Agent for the account of the Assignee, and the Assignee hereby
purchases from the Assignor, [a __% interest in] all of the Assignor's right,
title and interest in and to the Eligible Asset [s] purchased by the Assignor
[in [a] Purchase[s]] [pursuant to [an] Assignment and Acceptance[s]] on
_____________ __, ____, [_______________, ____, [etc.]] under the Agreement.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest in the Eligible Asset[s] being assigned by it
hereunder and that such interest in Eligible Asset[s] is free and clear of any
Adverse Claim; (ii) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Agreement or any other Transaction Document or
any other document furnished pursuant thereto or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Agreement or
any other Transaction Document or any other document furnished pursuant thereto,
or the perfection, priority or value of any ownership interest or security
interest created or purported to be created under the Agreement or the
Receivables Contribution and Sale Agreement; and (iii) makes no representation
or warranty and assumes no responsibility with respect to the financial
condition of the Seller or any Originator or the Collection Agent or the
performance or observance by the Seller or any Originator or the Collection
Agent of any of its obligations under the Agreement or any other Transaction
Document or any other document furnished pursuant thereto.
3. The Assignee (i) confirms that it has received copies of the
Agreement and the other Transaction Documents, together with copies of such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Assignment and purchase such
Eligible Asset[s]; (ii) agrees that it will, independently and without reliance
upon the Agent, any of its Affiliates, the Assignor or any other Eligible Asset
Owner and based on such documents and information as it shall deem appropriate
at the time,
continue to make its own credit decisions in taking or not taking action under
the Agreement and the other Transaction Documents and the other instruments and
documents furnished pursuant thereto; (iii) appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under the Agreement and the other Transaction Documents and the other
instruments and documents furnished pursuant thereto as are delegated to the
Agent by the terms thereof, together with such powers and discretion as are
reasonably incidental thereto; and (iv) appoints as its agent the Collection
Agent from time to time designated pursuant to Section 6.01 to enforce its
respective rights and interests in and under the Pool Receivables and the
Related Security and Collections with respect thereto and the related Contracts.
4. Following the execution of this Assignment by the Assignor and the
Assignee, it will be delivered to the Agent. The effective date of this
Assignment shall be the date above specified (the "EFFECTIVE DATE").
5. As of the Effective Date, (i) the Assignee shall be and become the
Owner of the interest in the Eligible Asset[s] referred to herein for all
purposes of the Agreement and (ii) the Assignor shall relinquish its rights with
respect to such interest in such Eligible Asset[s] for all purposes of the
Agreement.
6. This Assignment shall be governed by, and construed in accordance
with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Assignment to
be duly executed and delivered by their respective duly authorized officers or
agents as of the date first written above.
[NAME OF ASSIGNOR]
By:
-------------------------------------
Name:
Title:
[NAME OF ASSIGNEE]
By:
-------------------------------------
Name:
Title:
EXHIBIT B
ASSIGNMENT AND ACCEPTANCE
Dated as of _______ __, ____
Reference is made to the Fourth Amended and Restated Parallel Purchase
Commitment dated as of April 10, 2002 (the "AGREEMENT"), among PolyOne Funding
Corporation (the "SELLER"), PolyOne Corporation ("POLYONE"), individually and as
Collection Agent (the "COLLECTION AGENT"), Citibank, N.A. (the "ORIGINAL BANK")
and Citicorp North America, Inc., as Group Managing Agent and as agent for
itself, the other Group Managing Agents, the Banks and the Eligible Asset Owners
as defined therein (in such capacity, the "Agent"). Unless otherwise defined
herein, terms defined in the Agreement are used herein as therein defined.
__________ (the "ASSIGNOR") and _______________ (the "ASSIGNEE") agree
as follows:
1. The Assignor hereby sells and assigns, without recourse or any
representation or warranty except the representations and warranties made by it
herein, to the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, an interest in and to the Assignor's rights and obligations as a
Member of an Investor Group under the Agreement as of the date hereof
(including, without limitation, its obligations to make Purchases and to make
reinvestments of its interest in Collections of Pool Receivables attributable to
each Eligible Asset owned by it) equal to the percentage interest set forth with
respect to the Assignee under the name of the Assignor on Schedule I hereto of
all such rights and obligations of the Assignor as such Member. After giving
effect to such sale and assignment, (i) the Assignee will be a Member of the
Investor Group of which [the Assignee in the Group Managing Agent] [the Assignor
is a member] and (ii) the Commitment of the Assignee as a Member of such
Investor Group will be set forth with respect to the Assignee under the name of
the Assignor on Schedule I hereto.
2. In consideration of the payment of the aggregate Capital of the
interest in the Eligible Asset[s] being assigned hereunder by the Assignor to
the Assignee, receipt of which payment is hereby acknowledged, the Assignor
hereby assigns to the Agent for the account of the Assignee, and the Assignee
hereby purchases from the Assignor, the percentage interest set forth with
respect to the Assignee under the name of the Assignor on Schedule I hereto in
and to all of the Assignor's right, title and interest in the Eligible Asset[s]
purchased by the Assignor [in [a] Purchase[s]] [pursuant to [an] Assignment and
Acceptance[s] on _____, _____, [_____, _____, [etc.]] under the Agreement.
3. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest in the Eligible Asset[s] being assigned by it
hereunder and that such interest in such Eligible Asset[s] is free and clear of
any Adverse Claim created by it; (ii) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Agreement or any other
Transaction Document or any other document furnished pursuant thereto or in
connection therewith, or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of
the Agreement or any other Transaction Document or any other document furnished
pursuant thereto or in connection therewith, or the perfection, priority or
value of any ownership interest or security interest created or purported to be
created under the Agreement or under any other Transaction Document; and (iii)
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Seller, the Collection Agent or any Originator
or the performance or observance by the Seller, the Collection Agent or any
Originator of any of its obligations under the Agreement or any other
Transaction Document or any other document furnished pursuant thereto or in
connection therewith.
4. The Assignee (i) confirms that it has received a copy of the
Agreement and the other Transaction Documents together with such other documents
and information as it has deemed appropriate to make its own analysis and
decision to enter into this Assignment and Acceptance and to purchase the
interest in the Assignor's right, title and interest in Eligible Asset[s] being
purchased by it hereunder; (ii) agrees that it will, independently and without
reliance upon the Agent, any of its Affiliates, any Group Managing Agent, the
Assignor or any other Member or any former Member or other Indemnified Party and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own decisions in taking or not taking action under
the Agreement and the other Transaction Documents and the other instruments and
documents furnished pursuant thereto or in connection therewith; (iii) appoints
and authorizes the Agent and the Group Managing Agent of the Investor Group of
which the Assignee is a Member as a result of this Assignment and Acceptance to
take such action as agent on its behalf and to exercise such powers and
discretion under the Agreement and the other Transaction Documents and any other
instrument or document furnished pursuant thereto or in connection therewith as
are delegated to the Agent and such Group Managing Agent by the terms thereof,
together with such powers and discretion as are reasonably incidental thereto;
(iv) appoints as its agent the Collection Agent from time to time designated
pursuant to Section 6.01 of the Agreement to enforce its respective rights and
interests in and under the Pool Receivables and the Related Security and
Collections with respect thereto and the related Contracts; (v) agrees that it
will not institute against any Investor or any former Investor any proceeding of
the type referred to in Section 7.01(g) of the Agreement so long as any
commercial paper notes issued by such Investor shall be outstanding or there
shall not have elapsed one year plus one day since the last day on which any
such commercial paper notes shall have been outstanding; (vi) agrees that it
will perform in accordance with their terms all of the obligations which by the
terms of the Agreement are required to be performed by it as a Member of the
Investor Group of which the Assignee is a Member as a result of this Assignment
and Acceptance; (vii) confirms that it is an Eligible Assignee under and as
defined in the Agreement; and (viii) specifies as its address and telecopier
number for notices the office and telecopier number set forth beneath its name
on the signature pages hereof.
5. Following the execution of this Assignment and Acceptance, the
parties hereto shall promptly deliver such Assignment and Acceptance to the
Agent for acceptance and recording by the Agent. The effective date for this
Assignment and Acceptance shall be the later of (i) the date the Agent receives
this Assignment and Acceptance executed by the parties hereto and (ii) the date
of this Assignment and Acceptance (the "EFFECTIVE DATE").
6. Upon such acceptance and recording, as of the Effective Date, (i)
the Assignee shall be a party to the Agreement and, to the extent provided in
this Assignment and
Acceptance, have the rights and obligations of such Member thereunder and (ii)
the Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Agreement.
7. Upon such acceptance and recording, from and after the Effective
Date, the Agent shall make all payments under the Agreement in respect of the
interest assigned hereby (including, without limitation, all payments of
Capital, Yield and fees with respect thereto) to the Assignee. The Assignor and
the Assignee shall make all appropriate adjustments in payments under the
Agreement for periods prior to the Effective Date directly between themselves.
8. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of New York.
9. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of this Assignment and Acceptance by telecopier shall be effective
as delivery of an original executed counterpart of this Assignment and
Acceptance.
IN WITNESS WHEREOF, each Assignor and each Assignee have caused this
Assignment and Acceptance to be executed by their officers thereunto duly
authorized as of the date first above written.
[NAME OF ASSIGNOR]
By:
-------------------------------------
Name:
Title:
[NAME OF ASSIGNEE]
By:
-------------------------------------
Name:
Title:
[Address, telecopier number and e-mail
address]
Attention of:
Accepted this _____ day
of _______ __, ____
CITICORP NORTH AMERICA, INC.,
as Agent
By:
----------------------------------
Name:
Title:
SCHEDULE I
to
ASSIGNMENT AND ACCEPTANCE
- --------------------------------------------------- ------------------- -------------------
ASSIGNOR:
- --------------------------------------------------- ------------------- -------------------
ASSIGNEE
[Name of Assignee]
------------------- -------------------
------------------- -------------------
Percentage interest assigned by
Assignor and assumed by
Assignee
------------------- -------------------
Bank Commitment assigned by Assignor and
assumed by Assignee $
------------------- -------------------
Capital assigned by Assignor and
purchased by Assignee $
------------------- -------------------
------------------- -------------------
[Name of Assignee]
------------------- -------------------
------------------- -------------------
Percentage interest assigned by
Assignor and assumed by Assignee
------------------- -------------------
Commitment assigned by Assignor and
assumed by Assignee $
------------------- -------------------
Capital assigned by Assignor and
purchased by Assignee $
------------------- -------------------
[Etc.]
- --------------------------------------------------- ------------------- -------------------
EXHIBIT C
CERTIFICATE OF ASSIGNMENT
Dated as of __________, _____
Reference is made to the Fourth Amended and Restated Parallel Purchase
Commitment dated as of April 10, 2002 (the "AGREEMENT") among PolyOne Funding
Corporation (the "SELLER"), PolyOne Corporation ("POLYONE"), individually and as
Collection Agent (the "COLLECTION AGENT"), Citibank, N.A. (the "ORIGINAL BANK")
and Citicorp North America, Inc., as Group Managing Agent and as agent for
itself, the other Group Managing Agents, the Banks and the Eligible Asset Owners
as defined therein (in such capacity, the "Agent"). Terms defined in the
Agreement are used herein as therein defined.
The Seller hereby sells and assigns to the Agent for the account of
[Name of Bank] (together with its successive Assignees, the "APPLICABLE BANK"),
and each successive Eligible Asset Owners thereof, each Eligible Asset purchased
by the Applicable Bank under the Agreement.
Each Purchase of an Eligible Asset made by the Applied Bank from the
Seller, each assignment of such Eligible Asset by the Eligible Asset Owner
thereof to an Assignee and each reduction in Capital in respect of each Eligible
Asset evidenced hereby shall be endorsed by the Agent on the grid attached
hereto which is part of this Certificate of Assignment. Such endorsement shall
evidence the ownership of such Eligible Asset initially by the Applicable Bank
and upon any assignment, if any, thereof by the Assignee thereof and the amount
of Capital from time to time.
This Certificate of Assignment is made without recourse except as
otherwise provided in the Agreement.
This Certificate of Assignment shall be governed by, and construed in
accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the undersigned has caused this Certificate of
Assignment to be duly executed and delivered by its duly authorized officer as
of the date first above written.
POLYONE FUNDING CORPORATION
By:
-----------------------------------------
Name:
Title:
GRID*, **
Capital (Giving Eligible Asset Owner
Number of Eligible Effect to (Giving Effect to
Asset Transaction Transaction) Transaction)
- -------------
*Eligible Assets will be numbered sequentially based upon date of Purchase.
**Transactions are Purchases, Reductions in Capital, Assignments, Divisions of
Eligible Assets and Combinations of Eligible Assets.