RECEIVABLES PURCHASE AGREEMENT
DATED AS OF JULY 1, 1999
among
MAIL-WELL TRADE RECEIVABLES CORPORATION,
as Seller,
QUINCY CAPITAL CORPORATION,
as Issuer,
THE ALTERNATE PURCHASERS FROM
TIME TO TIME PARTY HERETO,
MAIL-WELL I CORPORATION,
as Servicer
and
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Administrator
TABLE OF CONTENTS
Page
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ARTICLE I. AMOUNTS AND TERMS OF THE PURCHASES 1
Section 1.1. Purchase Facility 1
Section 1.2. Making Purchases 2
Section 1.3. Purchased Interest Computation 3
Section 1.4. Settlement Procedures 4
Section 1.5. Fees 8
Section 1.6. Payments and Computations, Etc. 8
Section 1.7. Increased Costs 8
Section 1.8. Additional Discount on Portions of Capital
Bearing a Eurodollar Rate 9
Section 1.9. Requirements of Law 10
Section 1.10. Inability to Determine Eurodollar Rate 10
ARTICLE II. REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS 11
Section 2.1. Representations and Warranties; Covenants 11
Section 2.2. Termination Events 11
ARTICLE III. INDEMNIFICATION 12
Section 3.1. Indemnities by the Seller 12
ARTICLE IV. MISCELLANEOUS 14
Section 4.1. Amendments, Etc. 14
Section 4.2. Notices, Etc. 14
Section 4.3. Assignability 14
Section 4.4. Taxes 17
Section 4.5. No Proceedings; Limitation on Payments 17
Section 4.6. Confidentiality 17
Section 4.7. GOVERNING LAW AND JURISDICTION 17
Section 4.8. Execution in Counterparts 18
Section 4.9. Survival of Termination 18
Section 4.10. WAIVER OF JURY TRIAL 18
Section 4.11. Entire Agreement 19
Section 4.12. Headings 19
Section 4.13. Issuer's Liabilities 19
Section 4.14. Servicing Agreement 19
EXHIBIT I DEFINITIONS
EXHIBIT II CLOSING CONDITIONS
EXHIBIT III REPRESENTATIONS AND WARRANTIES
EXHIBIT IV COVENANTS
EXHIBIT V TERMINATION EVENTS
SCHEDULE I LOCK-BOX ACCOUNTS AND COLLECTION ACCOUNT
SCHEDULE II CONCENTRATION PERCENTAGES
SCHEDULE III LOCATION OF RECORDS
ANNEX A CREDIT AND COLLECTION POLICY
ANNEX B FORM OF LOCK-BOX AGREEMENT
ANNEX C FORM OF COLLECTION ACCOUNT AGREEMENT
ANNEX D ASSIGNMENT OF PURCHASE COMMITMENT
ANNEX E LIST OF FINANCING STATEMENTS
TO BE PARTIALLY RELEASED
RECEIVABLES PURCHASE AGREEMENT
This RECEIVABLES PURCHASE AGREEMENT (this "Agreement") is
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entered into as of July 1, 1999 among MAIL-WELL TRADE RECEIVABLES
CORPORATION, a Colorado corporation, as seller (the "Seller"),
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MAIL-WELL I CORPORATION, a Delaware corporation, as initial Servicer (in
such capacity, together with its successors and permitted assigns in
such capacity, the "Servicer"), QUINCY CAPITAL CORPORATION, a Delaware
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corporation (together with its successors and permitted assigns, the
"Issuer"), BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, a
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national banking association (in its individual capacity, "Bank of
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America" or such other name as it may be called subsequent to a merger)
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and each of the parties who has executed as an "Assignee" an Assignment
of Purchaser Commitment in the form of Annex D hereto (each, an
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"Assignment") (Bank of America and each such other party being
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referred to collectively as the "Alternate Purchasers" and
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individually as an "Alternate Purchaser"), and BANK OF AMERICA
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NATIONAL TRUST AND SAVINGS ASSOCIATION, a national banking association,
as administrator (in such capacity, together with its successors and
assigns in such capacity, the "Administrator").
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PRELIMINARY STATEMENTS. Certain terms that are capitalized
and used throughout this Agreement are defined in Exhibit I to this
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Agreement. References in the Exhibits hereto to "the Agreement" refer
to this Agreement, as amended, modified or supplemented from time to
time.
The Seller desires to sell, transfer and assign an undivided
variable percentage interest in a pool of receivables, and the Issuer
may, from time to time, in its sole discretion, and the Alternate
Purchasers shall, from time to time, acquire such undivided variable
percentage interest, as such percentage interest shall be adjusted from
time to time based upon, in part, reinvestment payments which are made
by the Issuer and/or the Alternate Purchaser and additional incremental
payments made to the Seller.
In consideration of the mutual agreements, provisions and
covenants contained herein, the parties hereto agree as follows:
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1. Purchase Facility. (a) On the terms and
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conditions hereinafter set forth, upon the request of the Seller the
Issuer may, in its sole discretion, and the Alternate Purchasers shall,
purchase and make reinvestments in the Purchased Interests from the
Seller from time to time during the period from the Effective Date to
the Facility Termination Date. Under no
circumstances shall the Issuer or any Alternate Purchaser make any such
purchase or reinvestment if after giving effect to such purchase or
reinvestment (i) the aggregate outstanding Capital of all Purchasers
would exceed the Purchase Limit, (ii) the aggregate of the Purchased
Interests of all Purchasers (expressed as a percentage) would exceed
100% or (iii) the outstanding Capital of any Alternate Purchaser would
exceed such Alternate Purchaser's Commitment Percentage of the aggregate
outstanding Capital of all Alternate Purchasers. Nothing in this
Agreement shall be deemed to be or construed as a commitment by the
Issuer to purchase or reinvest in the Purchased Interests.
(b) The Seller may, upon at least sixty days notice to the
Administrator, terminate the purchase facility provided in this
Section 1.1 in whole or, from time to time, irrevocably reduce in part
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the unused portion of the Purchase Limit (which shall reduce each
Alternate Purchaser's Purchaser Commitment on a pro rata basis);
provided, however, that (a) each partial reduction shall be in the
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amount of at least $5,000,000 or an integral multiple of $1,000,000 in
excess thereof and (b) in the event of any such partial reduction, the
remaining Purchase Limit will not be less than $100,000,000.
Section 1.2. Making Purchases. (a) Each purchase (but not
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reinvestment) of undivided ownership interests with regard to the
Purchased Interests hereunder shall be made upon the Seller's
irrevocable written notice delivered to the Administrator in accordance
with Section 4.2 (which notice must be received by the Administrator
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prior to 11:00 a.m., New York City time (i) in the case of a purchase to
be funded at the Alternate Rate and based on the Eurodollar Rate, three
Business Days, (ii) in the case of a purchase to be funded at the
Alternate Rate and based on the Base Rate, one Business Day, and (iii)
in the case of a purchase to be funded at the CP Rate, two Business
Days, prior to the requested purchase date) which notice shall specify
(A) the amount, which shall not be less than $1,000,000 and in integral
multiples of $100,000 in excess thereof, requested to be paid to the
Seller; provided, however, that such amount shall not be less than
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the amount necessary to cause aggregate outstanding Capital of all
Purchasers to equal at least $50,000,000, (B) the date of such purchase
and (C) whether such funding is requested of the Issuer or the Alternate
Purchasers and the desired funding basis for such purchase (which, with
respect to the Issuer, shall be the CP Rate or, with respect to the
Alternate Purchasers, the Alternate Rate. If such funding is requested
of the Issuer, the Administrator shall promptly thereafter notify the
Seller whether such terms are acceptable to the Issuer and whether the
Issuer is willing to make such a purchase; provided, however, if
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such purchase is not acceptable to the Issuer, then if acceptable to the
Seller, the Alternate Purchasers shall make such purchase. No purchase
or reinvestment shall be funded at the CP Rate on or after the Facility
Termination Date.
(b) On the date of each purchase (but not reinvestment) of
undivided ownership interests with regard to the Purchased Interests
hereunder, the Issuer, if willing to make such purchase or the Alternate
Purchasers, if requested to make such purchase, shall, upon satisfaction
of the applicable conditions set forth in Exhibit II hereto, make
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available to the Administrator in same day funds, for distribution on
such day to the Seller at the account specified by the Seller to
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the Administrator, an amount equal to (i) with respect to the Issuer,
the amount of such purchase requested or (ii) with respect to each
Alternate Purchaser, such Alternate Purchaser's Commitment Percentage of
the amount of such requested purchase.
(c) Effective on the date of each purchase pursuant to this
Section 1.2 and each reinvestment pursuant to Section 1.4, the
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Seller hereby sells and assigns to the Administrator, for the benefit of
the applicable Purchasers, an undivided percentage ownership interest in
(i) each Pool Receivable then existing, (ii) all Related Security with
respect to such Pool Receivables, and (iii) Collections with respect to,
and other proceeds of, such Pool Receivables and Related Security.
(d) To secure all of the Seller's Obligations under this
Agreement and the other Transaction Documents to which it is a party,
whether now or hereafter existing or arising, due or to become due,
direct or indirect, absolute or contingent, the Seller hereby grants to
the Administrator, for the benefit of the Securitization Parties, a
first priority security interest in all of the Seller's right, title and
interest (including, without limitation, any undivided interest of the
Seller) in, to and under all of the following, whether now or hereafter
owned, existing or arising: (A) all Pool Receivables, (B) all Related
Security with respect to each such Pool Receivable, (C) all Collections
with respect to each such Pool Receivable, (D) the Lock-Box Accounts and
Collection Account and all Collections on deposit therein and all
certificates and instruments, if any, from time to time evidencing such
Lock-Box Accounts or Collection Account, and the Collections on deposit
therein, all investments made with such funds, all claims thereunder or
in connection therewith, and all interest, dividends, moneys,
instruments, securities and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any
or all of the foregoing, (E) all of Seller's rights, remedies, powers
and privileges under, or in respect of, the Purchase and Sale Agreement
(whether arising pursuant to the terms of the Purchase and Sale
Agreement or otherwise available to the Seller at law or in equity) and
(F) all proceeds of, and all amounts received or receivable under any or
all of, the foregoing. The Administrator shall have, with respect to
the property described in this Section 1.2(d), and in addition to all
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the other rights and remedies available to the Securitization Parties,
all the rights and remedies of a secured party under any applicable UCC
or other applicable law. If, following the occurrence of a Termination
Event, the Administrator elects to exercise its right to take control of
any Lock-Box Account or the Collection Account in accordance with the
related Lock-Box Agreement or Collection Account Agreement, as the case
may be, the Administrator agrees to return, or to instruct the Lock-Box
Bank or the Collection Account Bank, as the case may be, to return, to
the applicable Originator or its designee any amounts in the Lock-Box
Account or the Collection Account, as the case may be, which are not
Collections as promptly as practicable following the Administrator's
receipt of evidence satisfactory thereto that such amounts are not
Collections.
Section 1.3. Purchased Interest Computation. The Purchased
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Interests shall be initially computed on the date of the initial
purchase hereunder. Thereafter until the Termination Date, the
Purchased Interests shall be automatically recomputed (or deemed to be
recomputed) on each
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Business Day other than a Termination Day. The Purchased Interests, as
computed (or deemed recomputed) as of the day immediately preceding the
Termination Date, shall thereafter remain constant. The Purchased
Interests shall become zero when the aggregate outstanding Capital of
all Purchasers and Discount thereon shall have been paid in full, all
the amounts owed by the Seller hereunder to the Securitization Parties
and any other Indemnified Party or Affected Person, are paid in full and
the Servicer shall have received the accrued Servicing Fee thereon.
Section 1.4. Settlement Procedures. (a) Collection of the
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Receivables shall be administered by the Servicer in accordance with the
terms of this Agreement and the Servicing Agreement. The Seller shall
provide to the Servicer on a timely basis all information and written
direction needed and written direction for such administration,
including notice of the occurrence of any Termination Day and current
computations of the aggregate of the Purchased Interests of all
Purchasers. All Collections of Pool Receivables shall be removed from
each Lock-Box Account and within two Business Days of deposit thereof
remitted to the Collection Account and all other collections shall be
removed from each Lock-Box Account or the Collection Account within two
Business Days of deposit thereof and remitted to the applicable
Originator or its designee.
(b) The Servicer shall, on each day on which Collections of Pool
Receivables are received (or deemed received) by the Seller or Servicer:
(i) set aside and hold in trust in the Collection Account
an amount equal to the accrued and unpaid Discount, Servicing Fee,
Administration Fee, Program Fee and Liquidity Fee (to the extent
not previously so set aside); and
(ii) set aside and hold in trust in the Collection Account
the remainder of Collections for distribution in accordance with
Section 1.4(c) or 1.4(f)(iii); provided, however, that if
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such day is not a Termination Day and to the extent the Seller has
not requested a reduction of Capital pursuant to
Section 1.4(f)(iii), the Servicer shall remit such remainder of
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Collections to the Seller; it being understood, that prior to
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remitting to the Seller such remainder of Collections, the
Servicer shall have calculated the aggregate of the Purchased
Interests of all Purchasers (expressed as a percentage) on such
day, and to the extent such percentage shall exceed 100% after
giving effect to such distribution to the Seller, such Collections
shall not be remitted to the Seller. Any such distribution to the
Seller, to the extent it would have been a return of Capital upon
remittance to any Purchaser, shall be deemed to be a reinvestment
by such Purchaser in the Pool Receivables, and in the Related
Security and Collections and other proceeds with respect thereto,
of the percentage of Collections remitted to the Seller
represented by the Purchased Interest of such Purchaser and such
Purchased Interest shall be automatically recomputed pursuant to
Section 1.3.
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(c) On each Settlement Date, the Servicer shall deposit:
(i) from amounts set aside thereby pursuant to
Section 1.4(b)(i) during the related Fixed Period:
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(A) first, to the Servicer (if the Servicer is not
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Mail-Well I Corporation or an Affiliate thereof), any
accrued and unpaid Servicing Fee for the related Fixed
Period;
(B) second, to the Administration Account (or such
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other account designated by the Administrator), any accrued
and unpaid Discount (on each Portion of Capital),
Administration Fee, Program Fee and Liquidity Fee for the
related Fixed Period; and
(C) third, any remaining amounts in accordance with
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Section 1.4(c)(ii) below.
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(ii) from amounts set aside thereby pursuant to
Section 1.4(b)(ii) or available pursuant to Section 1.4(c)(i)(C)
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above:
(A) first, to the extent funds are available
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therefor, if such day is a Termination Day or the Seller
has requested a reduction of Capital pursuant to
Section 1.4(f)(iii), to the Administration Account (or
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such other account designated by the Administrator), the
aggregate outstanding Capital of all Purchasers (or, in the
case of a reduction of Capital pursuant to Section 1.4(f)(iii),
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the aggregate amount of such reduction);
(B) second, to pay any amount in Sections 1.4(c)(i)(A)
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or 1.4(c)(i)(B) (in that order of priority) not otherwise
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paid in full in accordance therewith; and
(C) third, to pay any other Obligations payable
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by the Seller hereunder or under any other Transaction
Document;
(D) fourth, to the Servicer (if the Servicer is
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Mail-Well I Corporation or an Affiliate thereof), any
accrued and unpaid Servicing Fee for the related Fixed
Period; and
(E) fifth, if (i) such Settlement Date is not a
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Termination Day and to the extent the applicable conditions
set forth in Exhibit II hereto have been satisfied, to the
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Seller as a reinvestment in Receivables to the extent the
aggregate of the Purchased Interests of all Purchasers
(expressed as a percentage) would not exceed 100% after
giving effect to such distribution to the Seller, with any
excess amounts remaining in the Collection Account for
distribution in accordance with
5
this Section 1.4(c)(ii) on the next Settlement Date or
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(ii) the Final Payout Date has occurred, to the Seller.
If such Settlement Date is not a Termination Day, to the extent it would
have been a return of Capital upon remittance to each Purchaser, such
Purchaser shall be deemed to have reinvested the percentage of
Collections represented by the Purchased Interest of such Purchaser not
distributed to such Purchaser and such Purchased Interest shall be
automatically recomputed pursuant to Section 1.3. To the extent there
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are not sufficient funds available to distribute all amounts within a
given level of priority, such available funds will be distributed within
such level of priority on a pro rata basis based on the amount then due
and unpaid.
(d) Upon receipt of funds deposited into the Administration
Account pursuant to Section 1.4(c) or 1.4(f)(iii), the Administrator
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shall cause such funds to be distributed as follows:
(i) if such distribution occurs on a day that is not a
Termination Day, first, to the applicable Purchasers in payment
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in full of all accrued Discount (on each Portion of Capital),
second, to the applicable Securitization Parties in payment of
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any accrued and unpaid Administration Fee, Program Fee and
Liquidity Fee, and third, to the applicable Purchasers as a
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reduction of Capital of such Purchasers pursuant to
Section 1.4(f), if applicable; and
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(ii) if such distribution occurs on a Termination Day,
first, to the applicable Purchasers in payment in full of all
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accrued Discount (on each Portion of Capital), second, to the
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applicable Securitization Parties in payment in full of any
accrued and unpaid Administration Fee, Program Fee and Liquidity
Fee, third, to the applicable Purchasers in payment in full of
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all Capital of such Purchasers, and fourth, if the Capital and
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accrued Discount of all Purchasers has been reduced to zero, to
the Securitization Party and any other Indemnified Party or
Affected Person in payment in full of any other amounts owed
thereto by the Seller hereunder.
After the aggregate outstanding Capital of all Purchasers and Discount
(on each Portion of Capital) of all Purchasers and any Administration
Fee, Program Fee, Liquidity Fee and Servicing Fee, and any other amounts
payable by the Seller to the Securitization Parties or any other
Indemnified Party, Affected Person or any other Person hereunder, have
been paid in full, all additional Collections shall be paid to the
Seller for its own account. To the extent there are not sufficient
funds available to distribute to all Purchasers all amounts within a
given level of priority, such available funds will be distributed by the
Administrator within such level of priority on a pro rata basis based on
the amount then due and unpaid to such Purchasers.
(e) For the purposes of this Section 1.4:
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(i) if on any day the Outstanding Balance of any Pool
Receivable is reduced or adjusted as a result of any defective,
rejected, returned, goods or services, or
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any discount or other adjustment made by the Seller or the
Servicer or any setoff or dispute between the Seller, the Servicer
or any other Person and an Obligor ("Dilution"), the Seller
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shall be deemed to have received on such day a Collection of such
Pool Receivable in the amount of such Dilution and the Seller
shall immediately deposit such amount into the Collection Account
for distribution in accordance with this Section 1.4;
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provided, however, that to the extent such amount would be
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immediately remitted to the Seller pursuant to the proviso in
Section 1.4(b)(ii), such deposit and remittance may be made by
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book-entry only;
(ii) if on any day any of the representations or warranties
in paragraphs (h) or (n) of Exhibit III is not true with
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respect to any Pool Receivable (except as a result of a Receivable
becoming a Defaulted Receivable after the date such representation
or warranty was made), the Seller shall be deemed to have received
on such day a Collection of such Pool Receivable in full and the
Seller shall immediately deposit such amount into the Collection
Account for distribution in accordance with this Section 1.4;
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provided, however, that to the extent such amount would be
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immediately remitted to the Seller pursuant to the proviso in
Section 1.4(b)(ii), such deposit and remittance may be made by
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book-entry only; and
(iii) if and to the extent any Securitization Party shall be
required for any reason to pay over to an Obligor (or any trustee,
receiver, custodian or similar official in any Insolvency
Proceeding) any amount received by it hereunder, such amount shall
be deemed not to have been so received but rather to have been
retained by the Seller and, accordingly, such Securitization Party
shall have a claim against the Seller for such amount, payable
when and to the extent that any distribution from or on behalf of
such Obligor is made in respect thereof.
(f) If at any time the Seller shall wish to cause the reduction
of the aggregate outstanding Capital of all Purchasers (but not to
commence the liquidation, or reduction to zero, of the entire Capital of
all Purchasers), the Seller may do so as follows:
(i) the Servicer shall set aside Collections and
hold them in trust for the Purchasers under
Section 1.4(b)(ii) until the amount so set aside shall
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equal the desired amount of reduction;
(ii) the Seller shall give the Administrator written
notice of the amount of such proposed reduction and the date
on which such reduction will occur by no later than the
Required Notice Days prior to the date on which such
reduction will occur;
(iii) on the date of such reduction, the Servicer
shall deposit such Collections from amounts set aside and
held in trust pursuant to Section 1.4(b)(ii) on such date
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into the Administration Account for distribution in
accordance with
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Section 1.4(d) (it being understood that no Capital of any
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Purchaser shall be deemed reduced by any amount set aside
or held pursuant to this Section 1.4(f) unless and until,
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and then only to the extent that, such amount is finally
paid to such Purchaser as a reduction of Capital);
provided that,
(A) the amount of any such reduction shall be not less than
$1,000,000 and shall be an integral multiple of $500,000, and the
applicable Portion of Capital after giving effect to such
reduction shall be zero or not less than $1,000,000 and shall be
in an integral multiple of $100,000; and
(B) if more than one Portion of Capital shall be
outstanding at the time of any proposed reduction, such proposed
reduction shall be applied, unless the Seller shall otherwise
specify in the notice given pursuant to Section 1.4(f)(ii), to
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the Portion of Capital with the shortest remaining Fixed Period.
Section 1.5. Fees. The Seller shall pay to the Administrator
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certain fees in the amounts and on the dates set forth in a letter dated
as of the date hereof (the "Fee Letter") between the Seller and the
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Administrator, delivered pursuant to Section 1 of Exhibit II, as
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such letter agreement may be amended, supplemented or otherwise modified
from time to time in accordance with the terms thereof.
Section 1.6. Payments and Computations, Etc. (a) All amounts
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to be paid or deposited by the Seller or the Servicer hereunder shall be
paid or deposited no later than 12:00 noon (New York City time) on the
day when due in same day funds to the Administration Account. All
amounts received after 12:00 noon (New York City time) will be deemed to
have been received on the immediately succeeding Business Day.
(b) The Seller shall, to the extent permitted by law, pay
interest on any amount not paid or deposited by the Seller or the
Servicer) when due hereunder, at an interest rate equal to 2.0% per
---
annum above the Base Rate, payable on demand.
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(c) All computations of Discount, interest, fees, and other
amounts under any Transaction Document shall be made on the basis of a
year of 360 days for the actual number of days elapsed. Whenever any
payment or deposit to be made hereunder shall be due on a day other than
a Business Day, such payment or deposit shall be made on the next
succeeding Business Day and such extension of time shall be included in
the computation of such payment or deposit.
Section 1.7. Increased Costs. (a) If any Securitization Party
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or any other Program Support Provider or any of their respective
Affiliates (each an "Affected Person") determines that the existence
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of or compliance with (i) any law or regulation or any change therein or
in the
8
interpretation or application thereof, in each case adopted, issued or
occurring after the date hereof or (ii) any request, guideline or
directive from any central bank or other Governmental Authority (whether
or not having the force of law) issued or occurring after the date of
this Agreement affects or would affect the amount of capital required or
expected to be maintained by such Affected Person and such Affected
Person determines that the amount of such capital is increased by or
based upon the existence of any commitment to make purchases of or
otherwise to maintain the investment in Pool Receivables related to this
Agreement or any related liquidity facility or credit enhancement
facility and other commitments of the same type, then, upon demand by
such Affected Person (with a copy to the Administrator), the Seller
shall immediately pay to the Administrator, for the account of such
Affected Person, from time to time as specified by such Affected Person,
additional amounts sufficient to compensate such Affected Person for
such increase in capital 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 submitted to the Seller and the
Administrator by such Affected Person shall be conclusive and binding
for all purposes, absent manifest error.
(b) If, due to either (i) the introduction of or any change
(other than any change by way of imposition or increase of reserve
requirements referred to in Section 1.8) in or in the interpretation
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of any law or regulation or (ii) compliance with any guideline or
request from any central bank or other Governmental Authority (whether
or not having the force of law), there shall be any increase in the cost
to any Affected Person of agreeing to purchase or purchasing, or
maintaining the ownership of the Purchased Interest in respect of which
Discount is computed by reference to the Eurodollar Rate, then, upon
demand by such Affected Person, the Seller shall immediately pay to such
Affected Person, from time to time as specified, additional amounts
sufficient to compensate such Affected Person for such increased costs.
A certificate as to such amounts submitted to the Seller by such
Affected Person shall be conclusive and binding for all purposes, absent
manifest error.
Section 1.8. Additional Discount on Portions of Capital Bearing
---------------------------------------------------
a Eurodollar Rate. The Seller shall pay to the Administrator, for the
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account of any Affected Person, so long as such Affected Person shall be
required under regulations of the Board of Governors of the Federal
Reserve System to maintain reserves with respect to liabilities or
assets consisting of or including Eurocurrency Liabilities, additional
Discount on the unpaid Capital of the applicable Portion of Capital
during each Fixed Period in respect of which Discount is computed by
reference to the Eurodollar Rate, for such Fixed Period, at a rate per
annum equal at all times during such Fixed Period to the remainder
obtained by subtracting (i) the Eurodollar Rate for such Fixed Period
from (ii) the rate obtained by dividing such Eurodollar Rate referred to
in clause (i) above by that percentage equal to 100% minus the
Eurodollar Rate Reserve Percentage for such Fixed Period, payable on
each date on which Discount is payable on the applicable Portion of
Capital. Such additional Discount shall be determined by the Affected
Person and notified to the Seller through the Administrator within 30
days after any Discount payment is made with respect to which such
additional Discount is requested. A certificate as to such additional
Discount submitted to the
9
Seller by the Affected Person shall be conclusive and binding for all
purposes, absent manifest error.
Section 1.9. Requirements of Law. In the event that any
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Affected Person determines that the existence of or compliance with (x)
any law or regulation or any change therein or in the interpretation or
application thereof, in each case adopted, issued or occurring after the
date hereof or (y) any request, guideline or directive from any central
bank or other Governmental Authority (whether or not having the force of
law) issued or occurring after the date of this Agreement:
(i) does or shall subject such Affected Person to any tax
of any kind whatsoever with respect to this Agreement, any
increase in the Purchased Interest relating to such Affected
Person or in the amount of Capital relating thereto, or does or
shall change the basis of taxation of payments to such Affected
Person on account of Collections, Discount or any other amounts
payable hereunder (excluding taxes imposed on the net income of
such Affected Person, and franchise taxes imposed on such Affected
Person, by the jurisdiction under the laws of which such Affected
Person is organized or qualified (or should be qualified) to do
business or a political subdivision thereof);
(ii) does or shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar requirement
against assets held by, or deposits or other liabilities in or for
the account of, purchases, advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of
such Affected Person which are not otherwise included in the
determination of the Eurodollar Rate or the Base Rate hereunder;
or
(iii) does or shall impose on such Affected Person any other
condition;
and the result of any of the foregoing is (x) to increase the cost to
such Affected Person of acting as Administrator, or of agreeing to
purchase or purchasing or maintaining the ownership of undivided
ownership interests with regard to the Purchased Interest (or interests
therein) or any Portion of Capital in respect of which Discount is
computed by reference to the Eurodollar Rate or the Base Rate or (y) to
reduce any amount due hereunder (whether directly or indirectly) funded
or maintained by reference to the Eurodollar Rate or the Base Rate,
then, in any such case, upon demand by such Affected Person the Seller
shall pay such Affected Person any additional amounts necessary to
compensate such Affected Person for such additional cost or reduced
amount due. All such amounts shall be payable as incurred. A
certificate from such Affected Person to the Seller certifying the
amount of such additional costs or reduced amount due shall be
conclusive in the absence of manifest error.
Section 1.10. Inability to Determine Eurodollar Rate. In the
--------------------------------------
event that the Administrator shall have determined prior to the first
day of any Fixed Period (which determination shall be conclusive and
binding upon the parties hereto) by reason of circumstances affecting
the interbank Eurodollar market, either (a) dollar deposits in the
relevant amounts and for the
10
relevant Fixed Period are not available, (b) adequate and reasonable
means do not exist for ascertaining the Eurodollar Rate for such Fixed
Period or (c) the Eurodollar Rate determined pursuant hereto does not
accurately reflect the cost (as conclusively determined by the
Administrator) of maintaining any Portion of Capital during such Fixed
Period, the Administrator shall promptly give telephonic notice of such
determination, confirmed in writing, to the Seller prior to the first
day of such Fixed Period. Upon delivery of such notice (a) no Portion
of Capital shall be funded thereafter at the Alternate Rate determined
by reference to the Eurodollar Rate, unless and until the Administrator
shall have given notice to the Seller that the circumstances giving rise
to such determination no longer exist, and (b) with respect to any
outstanding Portions of Capital then funded at the Alternate Rate
determined by reference to the Eurodollar Rate, such Alternate Rate
shall automatically be converted to the Alternate Rate determined by
reference to the Base Rate at the respective last days of the then
current Fixed Periods relating to such Portions of Capital.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
Section 2.1. Representations and Warranties; Covenants. The
-----------------------------------------
Seller hereby makes the representations and warranties, and hereby
agrees to perform and observe the covenants set forth in Exhibits III
------------
and IV, respectively, hereto.
--
Section 2.2. Termination Events. If any of the Termination
------------------
Events set forth in Exhibit V hereto shall occur, the Administrator
---------
may, or, at the direction of the Issuer or Majority Alternate
Purchasers, shall by notice to the Seller, declare the Facility
Termination Date and the Commitment Termination Date to have occurred
(in which case the Facility Termination Date and the Commitment
Termination Date shall be deemed to have occurred); provided,
--------
however, that, automatically upon the occurrence of any event (without
- -------
any requirement for the passage of time or the giving of notice)
described in subsection (g) of Exhibit V, the Facility Termination
-------------- ---------
Date and the Commitment Termination Date shall occur. Upon any such
declaration, occurrence or deemed occurrence of the Facility Termination
Date and the Commitment Termination Date, the Securitization Parties
shall have, in addition to the rights and remedies which they may have
under this Agreement, all other rights and remedies provided after
default under the UCC and under other applicable law, which rights and
remedies shall be cumulative.
11
ARTICLE III.
INDEMNIFICATION
Section 3.1. Indemnities by the Seller. Without limiting any
-------------------------
other rights that the Securitization Parties or any of their respective
Affiliates, employees, agents, successors, transferees or assigns (each,
an "Indemnified Party") may have hereunder or under applicable law,
-----------------
the Seller hereby agrees to indemnify each Indemnified Party from and
against any and all claims, damages, expenses, losses and liabilities
(including Attorney Costs) (all of the foregoing being collectively
referred to as "Indemnified Amounts") arising out of or resulting from
-------------------
this Agreement or any other Transaction Document (whether directly or
indirectly) or the use of proceeds of purchases or reinvestments or the
ownership of the Purchased Interests, or any interest therein, or in
respect of any Receivable, excluding, however, (a) Indemnified Amounts
to the extent resulting from gross negligence or willful misconduct on
the part of such Indemnified Party or resulting from litigation between
two or more Indemnified Parties and not related to any action of
omission or alleged action or omission on the part of the Seller, the
Servicer, the Guarantor or any Originator, (b) recourse (except as
otherwise specifically provided in this Agreement) for uncollectible
Pool Receivables to be written off consistent with the Credit and
Collection Policy, or (c) any net income taxes or franchise taxes
imposed on such Indemnified Party by the jurisdiction under the laws of
which such Indemnified Party is organized or qualified (or should be
qualified) to do business or any political subdivision thereof. Without
limiting or being limited by the foregoing, and subject to the
exclusions set forth in the preceding sentence, the Seller shall pay on
demand to each Indemnified Party any and all amounts necessary to
indemnify such Indemnified Party from and against any and all
Indemnified Amounts relating to or resulting from any of the following:
(i) the failure of any Receivable included in the
calculation of the Net Receivables Pool Balance as an Eligible
Receivable to be an Eligible Receivable, the failure of any
information contained in a Seller Report to be true and correct,
or the failure of any other information provided to any
Securitization Party with respect to Receivables, Related
Security, Collections or this Agreement to be true and correct;
(ii) the failure of any representation or warranty or
statement made or deemed made by the Seller (or any of its
officers) or the Servicer under or in connection with this
Agreement or any other Transaction Document to have been true and
correct in all respects when made;
(iii) the failure by the Seller or the Servicer to comply
with the Credit and Collection Policy or any applicable law, rule
or regulation with respect to any Pool Receivable Related Security
or the related Contract Documents; or the failure of any Pool
Receivable Related Security or the related Contract Documents to
conform to any such applicable law, rule or regulation;
(iv) the failure to vest, and maintain vested, in the
Administrator, for the benefit of the Securitization Parties, a
valid and enforceable (A) perfected undivided percentage ownership
interest, to the extent of the Purchased Interests, in the
Receivables in, or purporting to be in, the Receivables Pool and
the Related Security and Collections
12
with respect thereto and (B) first priority perfected security
interest in the items described in Section 1.2(d), in each case,
--------------
free and clear of any Adverse Claim;
(v) Intentionally Omitted;
(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 Document 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 goods or services related to such
Receivable or the furnishing or failure to furnish such goods or
services or relating to collection activities with respect to such
Receivable (if such collection activities were performed by the
Seller or any of its Affiliates acting as Servicer or by any agent
or independent contractor retained by the Seller or any of its
Affiliates);
(vii) any failure of the Seller or the Servicer to perform
its duties or obligations in accordance with the provisions of
this Agreement or any other Transaction Document or to perform its
duties or obligations in connection with any Pool Receivable;
(viii) any claim (including, without limitation, any breach
of warranty, product liability or environmental claim),
investigation, litigation or proceeding arising out of or in
connection with any Pool Receivable or Related Security;
(ix) the commingling of Collections of Pool Receivables at
any time with other funds and any lost, mutilated, destroyed or
missing Contract Documents;
(x) any investigation, litigation or proceeding related to
this Agreement or any other Transaction Document (except if
unreasonably instituted by any Securitization Party) or the use of
proceeds of purchases or reinvestments or the ownership of the
Purchased Interest or in connection with any Pool Receivable or
Related Security;
(xi) any reduction in Capital as a result of the
distribution of Collections pursuant to Section 1.4(d), in the
--------------
event that all or a portion of such distributions shall thereafter
be rescinded or otherwise must be returned for any reason;
(xii) as at the date of any purchase or reinvestment the
aggregate of the Purchased Interests of all Purchasers exceeds
100% after giving effect to any purchase or reinvestment by any
Purchaser hereunder; or
(xiii) the enforcement of any Transaction Document against
the Seller, the Servicer, the Guarantor or any Originator by any
Securitization Party (except if unreasonably instituted by any
Securitization Party).
13
Indemnification under this Section 3.1 shall survive the termination
-----------
of this Agreement and shall include, without limitation, reasonable fees
and expenses of counsel and expenses of litigation.
ARTICLE IV.
MISCELLANEOUS
Section 4.1. Amendments, Etc. No amendment or waiver of any
---------------
provision of this Agreement or consent to any departure by the Seller or
Servicer therefrom shall be effective unless in a writing signed by the
Administrator, Issuer and Majority Alternate Purchasers, and, in the
case of any amendment, by the Seller and the Servicer 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 the consent of all Alternate Purchasers shall be
- -------
required in order to amend, modify or waive any provision of this
Agreement which would: (i) reduce the amount of Capital or Discount that
is payable on account of any Purchased Interest or delay any scheduled
date for payment thereof; (ii) increase the Purchase Limit; (iii) modify
the reserve requirements hereunder for uncollectible Receivables,
Discount or the Servicing Fee; or (iv) modify any yield protection or
indemnity provision which expressly inures to the benefit of the
Alternate Purchasers. No failure on the part of any Securitization
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.
Section 4.2. Notices, Etc. All notices and other
-------------
communications hereunder shall, unless otherwise stated herein, be in
writing (which shall include facsimile communication) and shall be sent
or delivered, to each party hereto, at its address set forth under its
name on the signature pages hereof or at such other address as shall be
designated by such party in a written notice to the other parties
hereto. Notices and communications by facsimile shall be effective when
sent (and shall be followed by hard copy sent by first class mail), and
notices and communications sent by other means shall be effective when
received.
Section 4.3. Assignability. (a) This Agreement and the
-------------
Issuer's rights and obligations herein (including ownership of the
Purchased Interest) shall be assignable, in whole or in part, by the
Issuer and its successors and assigns with, if a Termination Event has
not occurred and is continuing, the prior written consent of the Seller;
provided, however, that such consent shall not be unreasonably
- -------- -------
withheld (it being understood that withholding such consent shall not be
unreasonable if the Issuer wants to assign its rights and obligations
herein to an assignee which does not issue commercial paper); and
provided, further, that no such consent shall be required if the
- -------- -------
assignment is made to Bank of America, any Alternate Purchaser, any
Affiliate of Bank of America or any Alternate Purchaser (other than a
director or officer of Bank of America), any Liquidity Purchaser or
other Program Support Provider. Each assignor may, in connection with
such assignment or potential assignment, disclose to the applicable
assignee any information
14
relating to the Seller, Servicer or the Pool Receivables furnished to
such assignor by or on behalf of the Seller, Servicer, the Issuer or the
Administrator.
Without limiting the foregoing, the Issuer may, from time to time
in one transaction or a series of transactions, assign all or a portion
of the Purchased Interest of the Issuer and its rights and obligations
under this Agreement to an SPC Assignee. Upon and to the extent of such
assignment to an SPC Assignee, (i) the SPC Assignee shall be the owner
of the assigned portion of the Purchased Interest of the Issuer, (ii)
Bank of America (or an Affiliate thereof) will act as Administrator for
the SPC Assignee as well as for the Issuer, with all corresponding
rights and powers, express or implied, granted herein to the
Administrator, (iii) the SPC Assignee and its Program Support Providers
and other related parties shall have the benefit of all the rights and
protections provided to the Issuer and its Program Support Providers and
other related parties, respectively, herein and in the other Transaction
Documents (including, without limitation, any limitation on recourse
against the Issuer or related parties, any agreement not to file or join
in the filing of a petition to commence an Insolvency Proceeding against
the Issuer, and the right to assign to another SPC Assignee as provided
in this paragraph),(iv) the SPC Assignee shall assume all obligations,
if any, of the Issuer under and in connection with this Agreement, and
the Issuer shall be released from such obligations, in each case to the
extent of such assignment, and the obligations of the Issuer (if any)
and the SPC Assignee shall be several and not joint, (v) all distribu-
tions in respect of Capital of the Issuer or Discount thereon shall be
made to the Issuer and the SPC Assignee, on a pro rata basis according
to their respective interests (or in the case of Discount, the accrued
amounts thereof), (vi) the rate used to calculate such Discount with
respect to the portions of the Purchased Interest of the Issuer owned by
the SPC Assignee and funded with commercial paper notes issued by the
SPC Assignee from time to time shall be determined in the manner set
forth in the definition of "CP Rate" on the basis of the discount or
interest rates applicable to commercial paper issued by the SPC Assignee
(rather than the Issuer), (vii) the defined terms and other terms and
provisions of this Agreement and the other Transaction Documents shall
be interpreted in accordance with the foregoing, and (viii) if requested
by the Administrator, the parties will execute and deliver such further
agreements and documents and take such other actions as the
Administrator may reasonably request to evidence and give effect to the
foregoing.
(b) The Issuer may at any time grant to one or more banks or
other institutions (each a "Liquidity Purchaser") party to the
-------------------
Liquidity Asset Purchase Agreement or to any other Program Support
Provider participating interests in the Purchased Interests of the
Issuer. In the event of any such grant by the Issuer of a participating
interest to a Liquidity Purchaser or other Program Support Provider, the
Issuer shall remain responsible for the performance of its obligations
hereunder. The Seller agrees that each Liquidity Purchaser or other
Program Support Provider shall be entitled to the benefits of
Sections 1.7, 1.8 and 1.9 with respect to its participating
- ------------ --- ---
interest.
(c) This Agreement and the rights and obligations of the
Administrator hereunder shall be assignable, in whole or in part, by the
Administrator and its successors and assigns.
15
(d) Except as provided in the Servicing Agreement, neither the
Seller nor the Servicer may assign its rights or delegate its
obligations hereunder or any interest herein without the prior written
consent of the Administrator.
(e) Without limiting any other rights that may be available
under applicable law, the rights of any Securitization Party may be
enforced through it or by its agents.
(f) A Person (other than Bank of America) shall become a party
hereto and shall become an Alternate Purchaser hereunder upon
satisfaction of the conditions set forth in Section 4.3(g), acceptance
--------------
by the Administrator and recording of an Assignment by the Liquidity
Agent in the Register and the occurrence of the effective date of such
Alternate Purchaser's Purchaser Commitment (as set forth in such
Assignment) and subject to the approval of such Purchaser by the
Administrator and the Seller; provided, however, that the Seller's
-------- -------
approval shall not be unreasonably withheld.
(g) Subject to Section 4.3(f), each Alternate Purchaser may
--------------
assign to any Eligible Assignee (as defined in the Liquidity Asset
Purchase Agreement) all or a portion of its rights and obligations under
this Agreement; provided, however that:
-------- -------
(i) each such assignment shall be of a constant, and not a
varying, percentage of the aggregate rights and obligations of the
assigning Alternate Purchaser under this Agreement (including,
without limitation, its Purchaser Commitment and its Purchased
Interest, if any), and must be accompanied by a corresponding
assignment under the Liquidity Asset Purchase Agreement in
accordance with the terms thereof,
(ii) the amount of the assigning Alternate Purchaser's
Purchaser Commitment being assigned pursuant to such assignment to
any one Eligible Assignee shall in no event be less than
$5,000,000 and shall be in an integral multiple of $1,000,000,
and, unless such assigning Alternate Purchaser is assigning its
entire Purchaser Commitment, such assigning Alternate Purchaser's
retained Purchaser Commitment after giving effect to such
assignment shall in no event be less than $10,000,000,
(iii) the parties to each such assignment shall execute and
deliver an Assignment to the Administrator, for its acceptance by
the Administrator and recording by the Liquidity Agent in the
Register.
Upon such execution, delivery, acceptance and recording, from and after
the effective date specified in the Assignment, (x) the assignee
thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to this
Agreement, have the rights and obligations of an Alternate Purchaser
hereunder and (y) the Alternate Purchaser which is the assignor
thereunder shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to this Agreement, relinquish its
rights (other than the right to
16
receive payments from the Seller which accrued in favor of such
Alternate Purchaser prior to such assignment) and be released from its
obligations under this Agreement (and, if such Assignment provides for
an assignment of all such assigning Alternate Purchaser's Purchaser
Commitment, such Alternate Purchaser shall cease to be a party hereto).
(h) Upon receipt by the Administrator of an Assignment executed
by an assigning Alternate Purchaser and by an assignee who is an
Eligible Assignee (as defined in the Liquidity Asset Purchase Agreement)
and the satisfaction of the other conditions set forth in
Sections 4.3(f) and (g), the Administrator shall (i) accept such
- --------------- ---
Assignment, (ii) have the information contained therein recorded by the
Liquidity Agent in the Register and (iii) give prompt notice thereof to
the Issuer and the Servicer. The assigning Alternate Purchaser shall
pay to the Administrator an assigning fee equal to $2,500 for each
assignment hereunder.
(i) No Alternate Purchaser may sell any participations in any
portion of its rights and obligations under this Agreement, including,
without limitation, such Alternate Purchaser's Purchaser Commitment.
Section 4.4. Taxes. (a) In addition to the rights of
-----
indemnification granted under Section 3.1 hereof, the Seller shall pay
-----------
on demand any and all stamp and other taxes and fees payable in
connection with the execution, delivery, filing and recording of this
Agreement or the other documents or agreements to be delivered
hereunder, and agrees to save each Indemnified Party harmless from and
against any liabilities with respect to or resulting from any delay in
paying or omission to pay such taxes and fees.
Section 4.5. No Proceedings; Limitation on Payments. Each
--------------------------------------
party hereto hereby covenants and agrees that it will not institute
against, or join any other Person in instituting against, the Issuer or
any SPC Assignee any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceeding, or other proceeding under any federal or
state bankruptcy or similar law, for one year and one day after the
latest maturing Note issued by the Issuer or the SPC Assignee is paid in
full.
Section 4.6. Confidentiality. Unless otherwise required by
---------------
applicable law, the Seller and the Servicer agree to maintain the
confidentiality of this Agreement and the other Transaction Documents
(and all drafts thereof) in communications with third parties and
otherwise; provided, however, that this Agreement may be disclosed
-------- -------
(a) to third parties to the extent such disclosure is made pursuant to a
written agreement of confidentiality in form and substance reasonably
satisfactory to the Administrator, (b) to the Seller's legal counsel and
auditors if they agree to hold it confidential and (c) as required by
any law, rule or regulation.
Section 4.7. GOVERNING LAW AND JURISDICTION. (a) THIS
------------------------------
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE CONFLICT OF
LAWS
17
PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO CONSENTS,
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH PARTY HERETO IRREVOCABLY WAIVES, TO
THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT
OR ANY DOCUMENT RELATED HERETO. THE PARTIES HERETO EACH WAIVE PERSONAL
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY
ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
Section 4.8. 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.
Section 4.9. Survival of Termination. The provisions of
-----------------------
Sections 1.7, 1.8, 1.9, 3.1, 4.2, 4.4, 4.5, 4.6, 4.7, 4.9, 4.10, 4.11
- ------------ --- --- --- --- --- --- --- --- --- ---- ----
and Exhibits I, III, IV and V shall survive any termination of this
---------- --- -- -
Agreement.
Section 4.10. WAIVER OF JURY TRIAL. THE PARTIES HERETO EACH
--------------------
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE
OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY, IN ANY ACTION, PROCEEDING OR OTHER
LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
PARTY OR PARTIES, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE PARTIES HERETO EACH AGREE THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, EACH OF THE PARTIES HERETO FURTHER AGREES THAT
ITS RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS
SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS,
IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS
AGREEMENT OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS
AGREEMENT.
18
Section 4.11. Entire Agreement. This Agreement embodies the
----------------
entire agreement and understanding between the parties hereto, and
supersedes all prior or contemporaneous agreements and understandings of
such Persons, verbal or written, relating to the subject matter hereof
and thereof, except for any prior arrangements made with respect to the
payment by the Issuer of (or any indemnification for) any fees, costs or
expenses payable to or incurred (or to be incurred) by or on behalf of
the Seller, the Servicer and the Administrator.
Section 4.12. Headings. The captions and headings of this
--------
Agreement and in any Exhibit hereto are for convenience of reference
only and shall not affect the interpretation hereof or thereof.
Section 4.13. Issuer's Liabilities. The obligations of the
--------------------
Issuer under this Agreement are solely the corporate obligations of the
Issuer. No recourse shall be had for the payment of any amount owing by
the Issuer under this Agreement, or for the payment by the Issuer of any
other obligation or claim arising out of or based upon this Agreement
against any stockholder, employee, officer, director or incorporator of
the Issuer. The agreements provided in this Section 4.13 shall
------------
survive termination of this Agreement.
Section 4.14. Servicing Agreement. The Purchasers hereby
-------------------
authorizes the Administrator to execute, deliver, and take action under,
the Servicing Agreement on behalf of the Purchasers.
[SIGNATURES BEGIN ON THE FOLLOWING PAGE]
19
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of
the date first above written.
MAIL-WELL TRADE RECEIVABLES
CORPORATION, as Seller
By:_________________________________
Name: Robert Meyer
Title: Vice President,
Treasurer and Tax
23 Inverness Way East, Suite 160
Englewood, Colorado 80112
Attention: Robert Meyer
Telephone: (303) 790-8023
Facsimile: (303) 768-7380
MAIL-WELL I CORPORATION, as Servicer
By:_________________________________
Name: Robert Meyer
Title: Vice President,
Treasurer and Tax
23 Inverness Way East, Suite 160
Englewood, Colorado 80112
Attention: Robert Meyer
Telephone: (303) 790-8023
Facsimile: (303) 768-7380
20
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Administrator
By: _____________________________
Name:
Title:
Global Asset Securitization Group
231 S. LaSalle Street, Suite 1611
Chicago, Illinois 60697
Attention: Conduit Management Team
Telephone No.: (312) 828-1841
Facsimile No.: (312) 974-8975
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as an Alternate Purchaser
By: _____________________________
Name:
Title:
Global Asset Securitization Group
231 S. LaSalle Street, 14th Floor
Chicago, Illinois 60697
Attention: Marion Flynn
Telephone No.: (312) 828-6810
Facsimile No.: (312) 828-2480
with a copy to:
Bank of America National Trust
and Savings Association
Global Asset Securitization Group
231 S. LaSalle Street, Suite 1611
Chicago, Illinois 60697
Attention: Karen P. Louie
Telephone No.: (312) 828-8932
Facsimile No.: (312) 923-0273
Purchaser Commitment: $105,000,000
21
HARRIS TRUST AND SAVINGS BANK,
as an Alternate Purchaser
By: _____________________________
Name:
Title:
111 West Monroe Street
10th Floor Center
Chicago, Illinois 60603
Attention: James H. Colley
Telephone No.: (312) 461-6876
Facsimile No.: (312) 293-5041
Purchaser Commitment: $20,000,000
22
THE BANK OF NOVA SCOTIA,
as an Alternate Purchaser
By:_________________________________
Name:
Title:
The Bank of Nova Scotia
Atlanta Agency
600 Peachtree Street N.E.
Suite 2700
Atlanta, Georgia 30308
Attention: F.C.H. Ashby
Telephone: (404) 877-1500
Facsimile: (404) 888-8998
with a copy to:
The Bank of Nova Scotia
Houston Representative Office
1100 Louisiana, Suite 3000
Houston, Texas 77002
Attention: Gregory George
Telephone: (713) 759-3430
Facsimile: (713) 752-2425
Purchase Commitment: $20,000,000
23
QUINCY CAPITAL CORPORATION,
as Issuer
By: _______________________________
Name:
Title:
c/o AMACAR Group, L.L.C.
6525 Morrison Blvd, Suite 318
Charlotte, North Carolina 28211
Attention: Elizabeth Eldridge
Telephone No.: (704) 365-0569
Facsimile No.: (704) 365-1362
with a copy to:
Bank of America National Trust
and Savings Association
Global Asset Securitization Group
231 S. LaSalle Street, Suite 1611
Chicago, Illinois 60697
Attention: Conduit Management Team
Telephone No.: (312) 828-1841
Facsimile No.: (312) 974-8975
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EXHIBIT I
DEFINITIONS
As used in the Agreement (including its Exhibits), 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).
Unless otherwise indicated, all Section, Annex, Exhibit and Schedule
references in this Exhibit are to Sections of and Annexes, Exhibits and
Schedules to the Agreement.
"Acquisition" means, for any Person, any transaction or
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series of related transactions by such Person for the purpose of or
resulting, directly or indirectly, in (a) the acquisition of all or
substantially all of the assets of another Person, or of any business or
division of another Person, (b) the acquisition of a majority of the
voting stock (as defined in the definition of Subsidiary) of another
Person, or otherwise causing another Person to become a Subsidiary of
such Person, (c) the power of such Person to elect, appoint, or cause
the election or appointment of at least a majority of the members of the
board of directors or similar governing body by such Person of another
Person, or (d) a merger or consolidation or any other combination with
another Person (other than another Person that is a Subsidiary of such
Person) provided that such Person or its Subsidiary is the surviving
entity.
"Administration Account" means the special account (ABA
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#021001033, account #00-384-710, Reference: Bank of America as
Administrator, Attention: Stacy Coulon) of the Issuer maintained at
Bankers Trust Company, or such other account as may be so designated in
writing by the Administrator to the Seller and the Servicer.
"Administration Fee" has the meaning set forth in the Fee
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Letter.
"Administrator" has the meaning set forth in the preamble
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to the Agreement.
"Adverse Claim" means a lien, security interest, ownership
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interest or other charge or encumbrance, or any other type of
preferential arrangement, it being understood that a lien, security
interest, ownership interest or other charge or encumbrance, or any
other type of preferential arrangement, in favor of the Issuer shall not
constitute an Adverse Claim.
"Affected Person" has the meaning set forth in
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Section 1.7.
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"Affiliate" means, as to any Person, any other Person
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that, directly or indirectly, is in control of, is controlled by or is
under common control with such Person or is a director or officer of
such Person. For the purposes of this definition, "control", when used
with respect to any Person, means the power to direct the management and
policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the
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term "controlled" shall have meanings correlative to the foregoing.
Notwithstanding the foregoing, with respect to the Issuer, "Affiliate"
shall mean the holder(s) of its capital stock.
"Aggregate Reserve" means, on any date, the sum of (i) the
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Discount Reserve, plus (ii) the Loss Reserve, plus (iii) the Dilution
Reserve, plus (iv) the Servicing Fee Reserve, plus (v) the Commingling
Reserve, all as of such date; provided, however, that the Aggregate
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Reserve shall not be less than the Minimum Reserve on such date.
"Agreement" has the meaning set forth in the preamble.
---------
"Alternate Purchaser" has the meaning set forth in the
-------------------
preamble.
"Alternate Rate" for any Fixed Period for any Portion of
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Capital means an interest rate per annum equal to the Applicable Margin
per annum above the Eurodollar Rate for such Fixed Period; provided,
--------
however, that in the case of
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(i) any Fixed Period on or prior to the first day of which
the Administrator shall have been notified by the Issuer, an
Alternate Purchaser or Program Support Provider that the
introduction of or any change in or in the interpretation of any
law or regulation makes it unlawful, or any central bank or other
Governmental Authority asserts that it is unlawful, for the
Issuer, such Alternate Purchaser or such Program Support Provider
to fund any Portion of Capital (based on the Eurodollar Rate) set
forth above (and the Issuer, such Alternate Purchaser or such
Program Support Provider shall not have subsequently notified the
Administrator that such circumstances no longer exist),
(ii) any Fixed Period of less than one calendar month,
(iii) any Fixed Period as to which the Administrator does
not receive notice (provided, that other than with respect to the
initial Fixed Period for any Portion of Capital, if such notice is
not received, the Seller shall be deemed to have given such a
notice specifying its desire to continue to fund such Portion of
Capital for the next Fixed Period on the same funding basis as the
maturing Fixed Period), by no later than 11:00 a.m. (New York City
time) on (x) the second Business Day preceding the first day of
such Fixed Period that the Seller desires that the related Portion
of Capital be funded at the CP Rate, (y) the third Business Day
preceding the first day of such Fixed Period that the Seller
desires that the related Portion of Capital be funded at the
Alternate Rate and based on the Eurodollar Rate, or (z) the Seller
has given (or has been deemed to have given) the notice
contemplated by clause (x) of this clause (iii) and the
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Administrator shall have notified the Seller that funding the
related Portion of Capital at the CP Rate is unacceptable to the
Issuer, or
(iv) any Fixed Period relating to a Portion of Capital
which is less than $1,000,000,
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the "Alternate Rate" for each such Fixed Period shall be an interest
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rate per annum equal to the Base Rate in effect on each day of such
Fixed Period. Notwithstanding the foregoing, the "Alternate Rate" for
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any Termination Day resulting from a Termination Event shall be an
interest rate equal to 2.00% per annum above the Base Rate in effect
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on such day.
"Applicable Margin" means the sum of (a) the greater of
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(i) 1.50% and (ii) the sum of (A) 0.50%, plus (B) the "Applicable
Margin" described in clause (ii) of the definition thereof in the Credit
Agreement, dated as of March 16, 1998 among the Servicer, the guarantors
that are party thereto, Bank of America as administrative agent, and the
co-agents and other financial institutions party thereto, as in effect
on the date hereof (or, if such amount is increased, on the date such
increase became effective); provided, however, that if such Credit
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Agreement shall be terminated and another credit or borrowing facility
is executed by Mail-Well I Corporation to which Bank of America is a
party, then this clause (B) shall equal the excess of the interest rate
payable thereunder over the "LIBOR" or similar rate as defined therein
or, if not so defined, over LIBOR (as defined in the definition of
Eurodollar Rate), plus (b) on and after the earlier of the Commitment
Termination Date and the Facility Termination Date, 0.50%
"Assignment" has the meaning set forth in the preamble.
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"Attorney Costs" means and includes all reasonable fees
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and disbursements of any law firm or other counsel.
"Average Default Ratio" means, for any day, the arithmetic
---------------------
mean of the Default Ratio for the three most recent Monthly Periods.
"Average Maturity" means, at any time, that period of days
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equal to the average maturity of the Pool Receivables as calculated by
the Servicer in the then most recent Seller Report; provided,
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however, that if the Administrator shall disagree with any such
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calculation, the Administrator may recalculate the Average Maturity.
"Bank of America" has the meaning set forth in the
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preamble.
"Bankruptcy Code" means the United States Bankruptcy
---------------
Reform Act of 1978 (11 U.S.C. Section 101, et seq.), as amended from
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time to time.
"Base Rate" means, for any day, a fluctuating interest
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rate per annum as shall be in effect from time to time, which rate shall
be at all times equal to the sum of the Applicable Margin plus the
higher of:
(a) the rate of interest in effect for such day as
publicly announced from time to time by Bank of America in San
Francisco, California, as its "reference rate," which is a rate
set by Bank of America based upon various factors including Bank
of America's costs and desired return, general economic conditions
and other factors, and is
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used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate; and
(b) 0.50% per annum above the latest Federal Funds Rate.
"Billing Date" means the date on which the invoice with
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respect to a Receivable was originally generated.
"Business Day" means any day that is not a Saturday,
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Sunday or other day on which (i) banks are not authorized or required by
law or executive order to close in Chicago, Illinois, Charlotte, North
Carolina, New York City, New York or San Francisco, California and (ii)
if this definition of "Business Day" is utilized in connection with the
Eurodollar Rate, dealings are carried out in the London interbank
market.
"Capital" means, at any time with respect to any
-------
Purchaser, the amount paid to the Seller in respect of the Purchased
Interest by such Purchaser pursuant to the Agreement, reduced from time
to time by Collections distributed to such Purchaser and applied on
account of such amount as a reduction of Capital pursuant to
Section 1.4(d); provided, that if such Capital shall have been
- -------------- --------
reduced by any distribution and thereafter all or a portion of such
distribution must be returned for any reason, such Capital shall be
increased by the amount of such returned distribution, as though it had
not been made; and provided, further, that for any assignee or
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transferee of an interest hereunder from a Purchaser, such assignee's or
transferee's "Capital" at the time of such assignment or transfer
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shall be equal to that portion of the Capital of its transferor or
assignor so transferred or assigned to such assignee or transferee.
"Change in Control" means (a) with respect to Mail-Well I
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Corporation, any "person" or "group" (as such terms are used in
subsections 13(d) and 14(d) of the Exchange Act and the regulations
thereunder), is or becomes the "beneficial owner" (as such term is used
in Rules 13d-3 and 13d-5 under the Exchange Act, except that a person
shall be deemed to have "beneficial ownership" of all securities that
such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly,
of 30% or more of the then outstanding voting capital stock of the Mail-
Well I Corporation, or the Continuing Directors shall cease to
constitute at least a majority of the directors constituting the board
of directors of Mail-Well I Corporation, (b) with respect to each
Originator (other than Mail-Well I Corporation), that Mail-Well I
Corporation shall fail to own and control, directly or indirectly, free
and clear of all Adverse Claims, 80% of the issued and outstanding
voting stock thereof on a fully diluted basis and (c) with respect to
the Seller, that Mail-Well I Corporation shall fail to own directly,
free and clear of any Adverse Claims, 100% of the shares of outstanding
voting stock thereof on a fully diluted basis.
"Collection Account" means that certain account numbered
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101-8170435 maintained at the Collection Account Bank, which shall be
identified as "Mail-Well Trade
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Receivables Corporation and Bank of America National Trust and Savings
Association, as Administrator for and on behalf of certain secured
parties."
"Collection Account Agreement" means a letter agreement,
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in substantially the form of Annex C to the Agreement, among Seller,
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the Administrator and the Collection Account Bank, as the same may be
amended, supplemented or otherwise modified from time to time in
accordance with the Agreement.
"Collection Account Bank" means the bank holding the
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Collection Account which, initially shall be Norwest Bank of Colorado.
"Collection Delay Period" means ten days or such other
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number of days as the Administrator may select upon three Business Days'
notice to the Seller.
"Collections" means, with respect to any Pool Receivable,
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(a) all funds which are received by the Seller, any Originator, the
Servicer or the Administrator in payment of any amounts owed in respect
of such Pool Receivable (including, without limitation, principal,
finance charges, interest and all other charges), or applied to amounts
owed in respect of such Pool Receivable (including, without limitation,
insurance proceeds and net proceeds of the sale or other disposition of
the Related Security with respect thereto or other collateral or
property of the related Obligor or any other Person directly or
indirectly liable for the payment of such Pool Receivable and available
to be applied thereon), (b) all Collections deemed to have been received
pursuant to Section 1.4(e) and (c) all other proceeds of such Pool
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Receivable.
"Commingling Reserve" means, on any date, an amount
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computed as of the last day of each Monthly Period equal to the sum of
(a) the average of the Negative Monthly Amounts over the preceding
twelve Monthly Periods (or if such date occurs less than twelve Monthly
Periods following the date hereof, such fewer number of Monthly Periods
occurring prior to such date), plus (b) if a Trigger Event has occurred
and is continuing, 10%. For the purposes hereof:
"Negative Monthly Amount" means, for any Monthly Period, an
amount equal to the excess, if any, of the Average Weekly
Sales for such Monthly Period over the Average Weekly Cash
for such Monthly Period.
"Average Weekly Sales" means, an amount equal to the
quotient of the original Outstanding Principal Balance of
all Pool Receivables originated by the Originators during
such Monthly Period divided by four.
"Average Weekly Cash" means, for any Monthly Period an
amount equal to the quotient of the Collections received,
without duplication, in any Lock-Box Account, or the
Collection Account during such Monthly Period, divided by
four.
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"Commitment Percentage" means, with respect to any
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Alternate Purchaser at any time, the quotient of the Purchaser
Commitment of such Alternate Purchaser divided by the Purchase Limit.
"Commitment Termination Date" means the earliest to occur
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of (a) June 28, 2000, (b) the date determined pursuant to Section 2.2,
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(c) the date the Purchase Limit reduces to zero pursuant to
Section 1.1(b) and (d) the Purchase and Sale Termination Date (as
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defined in the Purchase and Sale Agreement).
"Concentration Percentage" means, for any Obligor, the
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"Concentration Percentage" determined pursuant to Schedule II for such
Obligor.
"Continuing Directors" means, as of any date, the
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collective reference to all members of the board of directors of Mail-
Well, Inc. who assumed office after such date and whose appointment or
nomination for election by Mail-Well, Inc.'s shareholders was approved
by a vote of at least 50% of the Continuing Directors in office
immediately prior to such appointment.
"Contract" means an agreement between an Originator and an
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Obligor pursuant to or under which such Obligor shall be obligated to
pay for merchandise or services from time to time.
"Contract Documents" means, with respect to any
------------------
Receivable, the related Contract and any agreement(s) modifying such
Receivable or Contract.
"CP Rate" means, for any Fixed Period for any Portion of
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Capital, to the extent the Issuer funds such Portion of Capital for such
Fixed Period by issuing Notes, the per annum rate equivalent to the
"weighted average cost" (as defined below) related to the issuance of
Notes that are allocated, in whole or in part, by the Issuer or the
Administrator to fund or maintain such Portion of Capital (and which may
also be allocated in part to the funding of other Portions of Capital
hereunder or of other assets of the Issuer); provided, however, that
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if any component of such rate is a discount rate, in calculating the
"CP Rate" for such Portion of Capital for such Fixed Period, the
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Issuer shall for such component use the rate resulting from converting
such discount rate to an interest bearing equivalent rate per annum. As
used in this definition, the Issuer's "weighted average cost" shall
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consist of (w) the actual interest rate (or discount) paid to purchasers
of the Issuer's Notes, together with the commissions of placement agents
and dealers in respect of such Notes, to the extent such commissions are
allocated, in whole or in part, to such Notes by the Issuer or the
Administrator, (x) certain documentation and transaction costs
associated with the issuance of such Notes, (y) any incremental carrying
costs incurred with respect to Notes maturing on dates other than those
on which corresponding funds are received by the Issuer, and (z) other
borrowings by the Issuer (other than under any Program Support
Agreement), including borrowings to fund small or odd dollar amounts
that are not easily accommodated in the commercial paper market.
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"Credit and Collection Policy" means those receivables
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credit and collection policies and practices of the Seller and each
Originator in effect on the date of the Agreement and attached hereto as
Annex A, as modified in compliance with the Agreement.
"Debt" means, for any Person, indebtedness, obligations
----
and liabilities of such Person (a) for borrowed money, (b) evidenced by
promissory notes, bonds, debentures, notes or other similar instruments,
(c) to pay the deferred purchase price of property or services other
than trade accounts payable of such Person arising in the ordinary
course of business that are not past due by more than 90 days, (d) as
lessee under leases which have been or should be, in accordance with
generally accepted accounting principles, recorded as capital leases,
(e) secured by any lien or other charge upon property or assets owned by
such Person, even though such Person has not assumed or become liable
for the payment of such obligations, (f) under any swap, cap, collar or
other hedging agreement, (g) under reimbursement agreements or similar
agreements with respect to the issuance of letters of credit (other than
obligations in respect of letters of credit opened to provide for
payment of goods and services purchased in the ordinary course of
business), (h) under direct or indirect guaranties in respect of, and
obligations (contingent or otherwise) to purchase or otherwise acquire,
or otherwise to assure a creditor against loss in respect of,
indebtedness or obligations of others of the kinds referred to in
clauses (a) through (g) above and (i) in respect of unfunded vested
benefits under plans covered by Title IV of ERISA. For the purposes
hereof, the term "guarantee" shall include any agreement, whether such
agreement is on a contingency or otherwise, to purchase, repurchase or
otherwise acquire Indebtedness of any other Person, or to purchase, sell
or lease, as lessee or lessor, property or services, in any such case
primarily for the purpose of enabling another person to make payment of
Indebtedness, or to make any payment (whether as an advance, capital
contribution, purchase of an equity interest or otherwise) to assure a
minimum equity, asset base, working capital or other balance sheet or
financial condition, in connection with the Indebtedness of another
Person, or to supply funds to or in any manner invest in another Person
in connection with Indebtedness of such Person.
"Default Ratio" means the ratio (expressed as a percentage
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and rounded upwards to the nearest 1/100 of 1%) computed as of the last
day of each Monthly Period by dividing (i) the sum of (a) the current
aggregate Outstanding Principal Balance of all Pool Receivables with any
portion thereof remaining unpaid for 121 to 150 days after the Billing
Date therefore on such day, plus (b) the aggregate Outstanding Principal
Balance of any other Pool Receivables that became Defaulted Receivables
during such Monthly Period by (ii) the aggregate original Outstanding
Principal Balance of all Pool Receivables originated by the Originators
during the Monthly Period five Monthly Periods prior to such day.
"Defaulted Receivable" means a Receivable:
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(i) (x) as to which any payment, or part thereof,
remains unpaid for at least 121 days from the original
Billing Date therefor;
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(ii) the Obligor of which, or any other Person
obligated thereon or owning any Related Security in respect
thereof, has taken any action or suffered any event to occur
of the type described in subsection (g) of Exhibit V
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hereto or any other Insolvency Proceeding;
(iii) which has been extended, amended, rewritten or
otherwise modified, except in accordance with the Servicing
Agreement; or
(iv) which, consistent with the Credit and Collection
Policy, has been, or would be, written off the Seller's or
the Originator's, as applicable, books as uncollectible.
"Designated Obligor" means, at any time, each Obligor;
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provided, however, that any Obligor shall cease to be a Designated
- -------- -------
Obligor upon three Business Days' notice by the Administrator to the
Seller that the Administrator has determined in its reasonable business
judgment that such Obligor is no longer acceptable; and provided,
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further, that any Person added as an Obligor after the date hereof
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shall be judged to be acceptable or not acceptable in the sole
discretion of the Administrator.
"Dilution" shall have the meaning set forth in Section
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1.4(e)(i).
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"Dilution Horizon Ratio" means, on any date, the ratio
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(expressed as a percentage and rounded upward to the nearest 1/100 of
1%) equal to the quotient of (i) the Outstanding Principal Balance of
all Pool Receivables originated by the Originators for the two Monthly
Periods preceding such day, divided by (ii) the Net Receivables Pool
Balance as of the last day of the most recent Monthly Period.
"Dilution Ratio" means the ratio (expressed as a
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percentage and rounded upward to the nearest 1/100 of 1%), computed as
of the last day of each Monthly Period, equal to the quotient of (i) the
aggregate amount of all Dilution with respect to the Pool Receivables at
the end of the preceding Monthly Period, divided by (ii) the aggregate
original Outstanding Principal Balance of Pool Receivables originated by
the Originators during the second Monthly Period preceding such day.
"Dilution Reserve" means, on any date, the product of (i)
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the sum of (a) the product of 2 multiplied by the Dilution Ratio, plus
(b) the Dilution Volatility Ratio, multiplied by (ii) the Dilution
Horizon Ratio, multiplied by (iii) the Net Receivables Pool Balance, all
as of such date.
"Dilution Volatility Ratio" means, on any date, the ratio
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(expressed as a percentage and rounded upward to the nearest 1/100 of
1%) equal to the product of (i) the excess of (A) the highest Dilution
Ratio calculated during the previous twelve Monthly Periods (or if such
date occurs less than twelve Monthly Periods following the date hereof,
such fewer number
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of Monthly Periods occurring prior to such date), over (B) the average
Dilution Ratio calculated during such period, multiplied by (ii) the
quotient of the amount determined under clause (A) above, divided by the
amount determined under clause (B) above.
"Discount" means:
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(i) for any Portion of Capital for any Fixed Period
to the extent such Portion of Capital will be funded by the
Issuer on the first day of such Fixed Period through the
issuance of Notes,
CPR x C x ED + TF
--
AD
(ii) for any Portion of Capital for any Fixed Period
to the extent such Portion of Capital will not be funded by
the Issuer on the first day of such Fixed Period through the
issuance of Notes,
ED
--
AR x C x AD + TF
where:
AR = the Alternate Rate for such Portion of Capital
for such Fixed Period.
C = the weighted average of the Dollar amount of
such Portion of Capital during such Fixed
Period.
CPR = the CP Rate for such Portion of Capital for such
Fixed Period (as determined by the Administrator
on or prior to the fourth Business Day of the
calendar month next following such Fixed
Period).
ED = the actual number of days during such Fixed
Period.
TF = the Termination Fee, if any, for such Portion of
Capital for such Fixed Period.
AD = 360.
provided, however, that during the continuance of a Termination
- -------- -------
Event, the CP Rate shall not be available and Discount for each Portion
of Capital shall be determined using the Alternate Rate for the related
Fixed Period; provided, further, that no provision of the Agreement
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shall require
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the payment or permit the collection of Discount in excess of the
maximum permitted by applicable law; and provided, further, that
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Discount for any Portion of Capital shall not be considered paid by any
distribution to the extent that at any time all or a portion of such
distribution is rescinded or must otherwise be returned for any reason.
"Discount Amount" means, on any date, the product of (i)
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2, multiplied by (ii) the Average Maturity for the preceding Monthly
Period as shown on the books and records of the Servicer, multiplied by
(iii) the quotient of (A) the Eurodollar Rate plus 1.125%, divided by
(B) 360, multiplied by (iv) the aggregate outstanding Capital of all
Purchasers, all as of such date.
"Discount Reserve" means, on any date, the sum of (i) the
----------------
Discount Amount and (ii) the accrued and unpaid Fees, all as of such
date.
"Effective Date" means the first date on which all the
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conditions precedent set forth in Section 1 of Exhibit II have been
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satisfied or waived by the Administrator.
"Dividends" means any dividend or distribution (in cash or
---------
obligations) on any shares of any class of Seller's capital stock or any
warrants, options or other rights with respect to shares of any class of
Seller's capital stock.
"Eligible Receivable" means, at any time, a Pool
-------------------
Receivable that satisfies each of the following criteria:
(i) such Receivable was originated in the United
States in the ordinary course of business by an Originator;
(ii) the Seller is the legal and beneficial owner of
such Receivable and Related Security free and clear of any
Adverse Claim, and as to which Receivable the Administrator,
for the benefit of the Securitization Parties, shall have a
valid and enforceable perfected undivided percentage
ownership interest, to the extent of the Purchased Interest,
free and clear of any Adverse Claim;
(iii) there is no right of rescission, offset, defense
or counterclaim to the obligation of the Obligor under such
Receivable to pay the Outstanding Principal Balance thereof,
or the interest, if any, due under such Receivable; the
exercise of any right thereunder will not render such
Receivable unenforceable in whole or in part or subject such
Receivable to any right of rescission, offset, defense or
counterclaim;
(iv) such Receivable, together with the Contract
related thereto, complies in all material respects with all
applicable state and federal laws (and regulations
thereunder), including, without limitation, to the extent
applicable, consumer protection, usury, equal credit
opportunity, fair credit billing, fair credit
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reporting, fair credit debt collection practices, truth-in-
lending or other similar laws, and the Federal Trade
Commission Act;
(v) such Receivable is the legal, valid and binding
obligation of the Obligor thereunder and is enforceable in
accordance with its terms, subject to bankruptcy,
insolvency, and other similar laws relating to the
enforcement of creditors' rights generally and to general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law) as they relate to bankruptcy, insolvency or similar
proceedings involving the Obligor as debtor, and all parties
to such Receivable had full legal capacity to execute such
Receivable and all other documents related thereto; terms of
such Receivable have not been waived or modified in any
material respect, except in accordance with the Servicing
Agreement and by instruments that are part of the related
Contract Documents;
(vi) such Receivable, according to the Contract
related thereto, is required to be paid in full in
accordance with the Credit and Collection Policy but in any
event within 30 days of the Billing Date therefor;
(vii) the Seller has not taken any action with respect
to such Receivable, or the related Contract, which, or
failed to take any action the omission of which, would
impair the rights of the Administrator or the Purchasers
therein;
(viii) Such Receivable is not a Defaulted Receivable,
and there is no other default, breach, violation or event
(other than a payment default) permitting involuntary early
termination existing under such Receivable and no event
that, with notice or the expiration of any grace or cure
period (or both), would constitute such a default, breach,
violation or event permitting involuntary early termination
under such Receivable;
(ix) such Receivable represents an obligation to pay
for (A)finished goods that have been shipped or services
that have been performed; provided, however, that if
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such Receivable relates to goods that have been shipped but
not yet invoiced, such goods will be invoiced by the Seller
within five Business Days of the date of such shipment, or
(B) finished goods that have been invoiced but not yet
shipped under a warehousing, post-production delivery or
other similar agreement with the relevant Obligor,
provided, however, that is such Receivable relates to
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finished goods invoiced and held not subject to any such
agreement, upon shipment of such finished goods such
Receivable shall become an Eligible Receivable;
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(x) such Receivable is denominated and payable in
U.S. dollars in the United States;
(xi) the Obligor of such Receivable is (A) a United
States resident, (B) not an Affiliate of the Seller, the
Servicer, any Originator or Mail-Well, Inc., (C) a
Designated Obligor and (D) not the Obligor of any
Receivables which remain unpaid 121 days or more from the
Billing Date which in the aggregate constitute 10% or more
of the aggregate Outstanding Principal Balance of all
Receivables of such Obligor;
(xii) the Obligor of such Receivable is not subject to
any action of the type described in subsection (g) of
--------------
Exhibit V or any other Insolvency Proceeding;
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(xiii) such Receivable complies with (A) the
requirements of the Credit and Collection Policy (including,
without limitation, those requirements with respect to the
payment terms of such Receivable) and (B) such other
criteria and requirements (other than those relating to the
collectibility of such Receivable) as the Administrator may
from time to time specify to the Seller upon 30 days'
notice;
(xiv) the Administrator has not provided notice to the
Seller that such Receivable (or class of Receivables) is not
acceptable for inclusion as an "Eligible Receivable";
(xv) such Receivable (A) does not prohibit (or
require the Obligor thereunder to consent to) the transfer,
sale or assignment of the rights and duties of the Seller or
the applicable Originator thereunder and (B) does not
contain a confidentiality provision that expressly restricts
the ability of the parties hereto to exercise their rights
under this Agreement, including, without limitation, their
right to review the Contract;
(xvi) such Receivable has not been originated in, or
subject to, the laws of any jurisdiction under which the
sale, transfer and assignment of such Receivables under the
Transaction Documents would be unlawful, void or voidable;
(xvii) all material consents, licenses or
authorizations of any Governmental Authority with respect to
such Receivable, and the related Contract, have been
obtained; and
(xviii) such Receivable constitutes an "account" as
defined in the UCC.
I-12
"ERISA" means the Employee Retirement Income Security Act
-----
of 1974, as amended from time to time, and any successor statute of
similar import, together with the regulations thereunder, in each case
as in effect from time to time. References to sections of ERISA also
refer to any successor sections.
"Eurodollar Rate" means, for any Fixed Period, an interest
---------------
rate per annum (rounded upward to the nearest 1/16th of 1%) determined
pursuant to the following formula:
Eurodollar Rate = LIBOR
--------
1.00 - ERP
Where,
"LIBOR" means the rate of interest per annum determined by
-----
the Administrator to be the arithmetic mean (rounded upward to the
nearest 1/16th of 1%) of the rates of interest per annum notified
to the Administrator by each Reference Bank as the rate of
interest at which dollar deposits in the approximate amount of the
Capital associated with such Fixed Period would be offered to
major banks in the London interbank market at their request at or
about 11:00 a.m. (London time) on the second Business Day prior to
the commencement of such Fixed Period.
"ERP" means, for any Fixed Period, the maximum reserve
---
percentage (expressed as a decimal, rounded upward to the nearest
1/100th of 1%) in effect on the date LIBOR for such Fixed Period
is determined under regulations issued from time to time by the
Federal Reserve Board for determining the maximum reserve
requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding
(currently referred to as "Eurocurrency liabilities") having a
term comparable to such Fixed Period.
"Exchange Act" means the Securities Exchange Act of 1934,
------------
and regulations promulgated thereunder, as amended.
"Facility Termination Date" means the earliest to occur of
-------------------------
(a) June 27, 2004, (b) the Purchase Termination Date, as defined in the
Liquidity Asset Purchase Agreement, which on the date of the Agreement
is June 30, 2000, or such later date designated as the Purchase
Termination Date from time to time pursuant to the Liquidity Asset
Purchase Agreement (it being understood that the Administrator shall
notify the Seller of the designation of such later date, provided that
failure to provide such notice shall not limit or otherwise affect the
obligations of the Seller or the rights of the Administrator, the
Issuer, or any other party to the Liquidity Asset Purchase Agreement),
(c) the date of termination of the commitment under any other Program
Support Agreement, (d) the date determined pursuant to Section 2.2,
-----------
(e) the date the Purchase Limit reduces to zero pursuant to
Section 1.1(b) and (f) the Purchase and Sale Termination Date (as
- --------------
defined in the Purchase and Sale Agreement).
I-13
"Facts and Assumptions" means the "Facts and Assumptions"
---------------------
set forth in the true sale/non-consolidation opinion delivered by
Rothgerber, Johnson & Lyons in connection herewith on the Effective Date
(and in any similar opinion delivered in connection with the addition of
any Originator after the Effective Date).
"Federal Funds Rate" means, for any day, the per annum
------------------
rate set forth in the weekly statistical release designated as
H.15(519), or any successor publication, published by the Federal
Reserve Board (including any such successor, "H.15(519)") for such day
opposite the caption "Federal Funds (Effective)". If on any relevant
day such rate is not yet published in H.15(519), the rate for such day
will be the rate set forth in the daily statistical release designated
as the Composite 3:30 p.m. Quotations for U.S. Government Securities, or
any successor publication, published by the Federal Reserve Bank of New
York (including any such successor, the "Composite 3:30 p.m. Quotation")
for such day under the caption "Federal Funds Effective Rate". If on
any relevant day the appropriate rate for such previous day is not yet
published in either H.15(519) or the Composite 3:30 p.m. Quotations, the
rate for such day will be the arithmetic mean as determined by the
Administrator of the rates for the last transaction in overnight Federal
funds arranged prior to 9:00 a.m. (New York time) on that day by each of
three leading brokers of Federal funds transactions in New York City
selected by the Administrator.
"Federal Reserve Board" means the Board of Governors of
---------------------
the Federal Reserve System, or any entity succeeding to any of its
principal functions.
"Fee Letter" has the meaning set forth in Section 1.5.
---------- -----------
"Fees" mean all fees and other amounts payable by the
----
Seller to the Securitization Parties pursuant to the Fee Letter,
including, without limitation, the Administration Fee, the Program Fee
and Liquidity Fee.
"Final Payout Date" means the date following the Facility
-----------------
Termination Date and the Commitment Termination Date on which no Capital
or Discount in respect of the Purchased Interest of any Purchaser shall
be outstanding and all other amounts (excluding contingent obligations
under indemnities and the like as to which no present payment obligation
exists) payable by any Originator, the Seller, the Guarantor or the
Servicer to each Securitization Party or any other Affected Person under
the Transaction Documents shall have been paid in full.
"Fixed Period" means, unless otherwise mutually agreed by
------------
the Administrator and the Seller, (a) with respect to any Portion of
Capital funded by the issuance of Notes, (x) initially the period
commencing on (and including) the date of the initial purchase or
funding of such Portion of Capital and ending on (but excluding) the
first day of the next following calendar month, and (y) thereafter, each
period commencing on (and including) the last day of the immediately
preceding Fixed Period for such Portion of Capital and ending on (but
excluding) the first day of the next following calendar month; and (b)
with respect to any Portion of Capital not funded by the issuance of
Notes, (x) initially the period commencing on (and including) the
I-14
date of the initial purchase or funding of such Portion of Capital and
ending on (but excluding) the next following Settlement Date, and (y)
thereafter, each period commencing on (and including) the last day of
the immediately preceding Fixed Period for such Portion of Capital and
ending on (but excluding) the next following Settlement Date;
provided, that
- --------
(i) any Fixed Period (other than of one day or funded
through the issuance of Notes) which would otherwise end on
a day which is not a Business Day shall be extended to the
next succeeding Business Day; provided, however, if
-------- -------
Discount in respect of such Fixed Period is computed by
reference to the Eurodollar Rate, and such Fixed Period
would otherwise end on a day which is not a Business Day,
and there is no subsequent Business Day in the same calendar
month as such day, such Fixed Period shall end on the next
preceding Business Day;
(ii) in the case of any Fixed Period for any Portion
of Capital which commences before the Termination Date and
would otherwise end on a date occurring after the
Termination Date, such Fixed Period shall end on such
Termination Date and the duration of each Fixed Period which
commences on or after the Termination Date shall be of such
duration as shall be selected by the Administrator;
(iii) any Fixed Period in respect of which Discount
is computed by reference to the CP Rate may be terminated at
the election of, and upon notice thereof to the Seller by,
the Administrator at any time, in which case the Portion of
Capital allocated to such terminated Fixed Period shall be
allocated to a new Fixed Period commencing on (and
including) the date of such termination and ending on (but
excluding) the next following Settlement Date, and
thereafter Discount shall accrue at the Alternate Rate.
"Governmental Authority" means any nation or government,
----------------------
any state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any body or entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, including,
without limitation, any court, and any Person owned or controlled,
through stock or capital ownership or otherwise, by any of the
foregoing.
"Guarantor" has the meaning set forth in the Purchase and
---------
Sale Agreement.
"Indemnified Amounts" has the meaning set forth in
-------------------
Section 3.1.
- -----------
"Indemnified Party" has the meaning set forth in Section
----------------- -------
3.1.
- ---
"Insolvency Proceeding" means (a) any case, action or
---------------------
proceeding before any court or other Governmental Authority relating to
bankruptcy, reorganization, insolvency, liquidations, receivership,
dissolution, winding-up or relief of debtors, or (b) any general
I-15
assignment for the benefit of creditors, composition, marshalling of
assets for creditors, or other, similar arrangement in respect of its
creditors generally or any substantial portion of its creditors; in each
case (a) and (b) undertaken under U.S. Federal, state or foreign law,
including the Bankruptcy Code.
"Issuer" has the meaning set forth in the preamble to the
------
Agreement.
"Liquidity Agent" means Bank of America in its capacity as
---------------
Liquidity Agent pursuant to the Liquidity Asset Purchase Agreement.
"Liquidity Asset Purchase Agreement" means that certain
----------------------------------
Liquidity Asset Purchase Agreement, dated as of the date hereof, among
the Issuer, Bank of America and certain other Persons, as Liquidity
Purchasers, and Bank of America, as Liquidity Agent, as amended,
supplemented or otherwise modified from time to time.
"Liquidity Fee" has the meaning set forth in the Fee
-------------
Letter.
"Liquidity Purchaser" has the meaning set forth in
-------------------
Section 4.3(b).
- --------------
"Lock-Box Account" means an account maintained at a bank
----------------
or other financial institution for the purpose of receiving Collections.
"Lock-Box Agreement" means an agreement, in substantially
------------------
the form of Annex B, between the Seller, the Administrator and each
-------
Lock-Box Bank, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the Agreement.
"Lock-Box Bank" means any of the banks or other financial
-------------
institutions holding one or more Lock-Box Accounts.
"Loss Horizon Ratio" means the ratio (expressed as a
------------------
percentage and rounded upward to the nearest 1/100 of 1%), computed as
of the last day of each Monthly Period, equal to the quotient of (i) the
aggregate original Outstanding Principal Balance of all Pool Receivables
originated by the Originators during the preceding four Monthly Periods,
divided by (ii) the Net Receivables Pool Balance as of such day.
"Loss Reserve" means, on any date, the product of (i) 2,
------------
multiplied by (ii) the highest Average Default Ratio calculated during
the previous twelve Monthly Periods, multiplied by (iii) the Loss
Horizon Ratio, multiplied by (iv) the Net Receivables Pool Balance, all
as of such date.
"Majority Alternate Purchasers" means at any time
-----------------------------
Alternate Purchasers whose Commitment Percentages aggregate to more than
75%.
I-16
"Material Adverse Effect" means a material adverse effect
-----------------------
on (i) the Seller's, the Servicer's, the Guarantor's or any Originator's
ability to perform its obligations under the Transaction Documents, (ii)
the enforceability of any Transaction Document, (iii) the Seller's, the
Servicer's, the Guarantor's or any Originator's business or financial
condition, (iv) the interests of any Securitization Party or Program
Support Provider under any Transaction Document or (v) the
enforceability or collectibility of any Pool Receivable.
"Minimum Reserve" means, on any date, the sum of (a) the
---------------
greater of (i) $8,000,000 and (ii) the sum of (A) the product of (1) the
greatest of (x) the "Concentration Percentage" for "Second Tier
Obligors", (y) the product of 2, multiplied by the "Concentration
Percentage" for "Third Tier Obligors", and (z) the product of 4,
multiplied by the "Concentration Percentage" for "Fourth Tier Obligors",
each as determined in accordance with Schedule II, multiplied by (2) the
Net Receivables Pool Balance, plus (B) the product of the Dilution
Ratio, multiplied by the Dilution Horizon Ratio, plus (b) the Servicing
Fee Reserve, plus (c) the Discount Reserve plus (d) the Commingling
Reserve, all as of such date.
"Monthly Period" shall mean initially, the period from
--------------
Saturday, July 3, 1999 to Saturday, July 31, 1999, and thereafter the
period from the last day of the prior Monthly Period to the fourth (or,
in the case of the third Monthly Period of each fiscal quarter, the
fifth) Saturday following such day or such other period as shall be
agreed upon by the Seller, the Servicer and the Administrator. The
Monthly Period preceding the last day of any Monthly Period shall be
that Monthly Period.
"Moody's" means Moody's Investors Service, Inc., or its
-------
successor.
"Net Receivables Pool Balance" means at any time the
----------------------------
difference of (i) the Outstanding Principal Balance of the Eligible
Receivables then in the Receivables Pool minus (ii) the aggregate amount
by which the Outstanding Principal Balance of the Eligible Receivables
of each Obligor exceeds the product of (A) the Concentration Percentage
for such Obligor, multiplied by (B) the amount determined in accordance
with clause (i) above minus (iii) the aggregate amount by which the
Outstanding Principal Balance of all Eligible Receivables the Obligors
of which are the United States or any state or local government thereof
or any agency, department or instrumentality of the United States or any
state or local government thereof, exceeds 5% of the amount determined
in accordance with clause (i) above.
"Notes" means short-term promissory notes issued or to be
-----
issued by the Issuer to fund its investments in accounts receivable or
other financial assets.
"Obligations" means all obligations (monetary or
-----------
otherwise) of Seller to the Securitization Parties and Program Support
Providers and their respective successors, permitted transferees and
assigns arising under or in connection with this Agreement and each
other Transaction Document, in each case however credited, arising or
evidenced, whether direct or indirect, absolute or contingent, now or
hereafter existing, or due or to become due.
I-17
"Obligor" means, with respect to any Receivable, the
-------
Person(s) who has incurred the indebtedness under such Receivables and
any guarantor(s) or any other Person obligated to make payments of such
Receivable.
"Originator" has the meaning set forth in the Purchase and
----------
Sale Agreement.
"Originator Note" has the meaning set forth in the
---------------
Purchase and Sale Agreement.
"Outstanding Principal Balance" means, with respect to any
-----------------------------
Receivable as of any date, the amount equal to the original principal
balance of such Receivable, as reduced by the portion of all payments
due and received thereon before such date that would represent principal
if such payments were allocated to the principal of, and interest on,
such Receivable.
"PBGC" means the Pension Benefit Guaranty Corporation.
----
"Pension Plan" has the meaning set forth in the Purchase
------------
and Sale Agreement.
"Person" means an individual, partnership, corporation
------
(including a business trust), joint stock company, trust, unincorporated
association, joint venture, limited liability company or other entity,
or a government or any political subdivision or agency thereof.
"Pool Receivable" means a Receivable in the Receivables
---------------
Pool.
"Portion of Capital" means, at any time, each portion of
------------------
the Capital of the Issuer or of the Alternate Purchasers having the same
Fixed Period and accruing Discount by reference to the same Rate Type at
such time. If there is only one such portion, "Portion of Capital"
means 100% of such Capital.
"Prior Purchase Agreement" means the Purchase and
------------------------
Contribution Agreement, dated as of November 15, 1996, among the Seller
and certain Originators, as heretofor amended, supplemented or otherwise
modified.
"Proceeding" means any suit in equity, action at law or
----------
other judicial or administrative proceeding.
"Program Fee" has the meaning set forth in the Fee Letter.
-----------
"Program Support Agreement" means and includes the
-------------------------
Liquidity Asset Purchase Agreement and any other agreement entered into
by any Program Support Provider providing for the issuance of one or
more letters of credit for the account of the Issuer, the issuance of
one or more surety bonds for which the Issuer is obligated to reimburse
the applicable Program Support Provider for any drawings thereunder, the
sale by the Issuer to any Program Support Provider of the Purchased
Interest (or portions thereof) and/or the making of loans and/or other
extensions of
I-18
credit to the Issuer in connection with the Issuer's securitization
program, together with any letter of credit, surety bond or other
instrument issued thereunder (but excluding any discretionary advance
facility provided by the Administrator).
"Program Support Provider" means and includes the Issuer
------------------------
and any other or additional Person (other than any customer of the
Issuer) now or hereafter extending credit or having a commitment to
extend credit to or for the account of, or to make purchases from, the
Issuer or issuing a letter of credit, surety bond or other instrument to
support any obligations arising under or in connection with the Issuer's
securitization program, including, without limitation, the Liquidity
Purchasers.
"Purchase and Sale Agreement" means the Purchase and Sale
---------------------------
Agreement, dated as the date hereof, among the Seller, Mail-Well I
Corporation, as initial servicer and as guarantor, and each originator
from time to time party thereto, as the same may be amended,
supplemented or modified from time to time.
"Purchase and Sale Termination Event" has the meaning set
-----------------------------------
forth in the Purchase and Sale Agreement.
"Purchase Limit" means, at any time, the aggregate
--------------
Purchaser Commitment of each Alternate Purchaser at such time.
"Purchased Interest" means, with respect to any Purchaser
------------------
at any time, the undivided percentage ownership interest of such
Purchaser in (i) each and every Pool Receivable now existing or
hereafter arising, other than any Pool Receivable that arises on or
after the later of the Facility Termination Date or the Commitment
Termination Date, (ii) all Related Security with respect to such Pool
Receivables, and (iii) all Collections with respect to, and other
proceeds of, such Pool Receivables and Related Security. Such undivided
percentage interest shall be computed as follows:
C x (1 + (AR/AC))/NRPB
where:
C = the aggregate outstanding Capital of such
Purchaser at the time of computation.
AC = the aggregate outstanding Capital of all
Purchasers at the time of computation.
AR = the Aggregate Reserve at the time of
computation.
NRPB = the Net Receivables Pool Balance at the time of
computation.
I-19
The Purchased Interest shall be determined from time to time pursuant to
the provisions of Section 1.3.
-----------
"Purchaser Commitment" means, for any Alternate Purchaser,
--------------------
the amount of such Alternate Purchaser's commitment to make purchases
hereunder set forth under its signature to the Agreement or the
Assignment by which such Alternate Purchaser became a party to the
Agreement, as modified in accordance with Sections 1.1(b) and 4.3.
--------------- ---
"Purchasers" means the Issuer and the Alternate
----------
Purchasers.
"Purchasing Certificate" means a certificate, in
----------------------
substantially the form of Exhibit B to the Servicing Agreement,
---------
furnished by the Servicer to the Administrator in connection with each
purchase hereunder.
"Rate Type" means the Eurodollar Rate, the Base Rate or
---------
the CP Rate.
"Receivable" means the indebtedness of any Obligor
----------
resulting from the provision or sale of merchandise, insurance or
services by an Originator under a Contract, and includes, without
limitation, the right to payment of any interest or finance charges and
other obligations of such Obligor with respect thereto.
"Receivables Pool" means at any time all of the then
----------------
outstanding Receivables that have been transferred and assigned to the
Seller by the Originators from time to time pursuant to the Purchase and
Sale Agreement or the Prior Purchase Agreement and that are owned by the
Seller and/or the Purchasers at such time.
"Reference Bank" means Bank of America.
--------------
"Register" means the "Register" maintained pursuant to the
--------
Liquidity Asset Purchase Agreement.
"Related Security" means with respect to any Receivable:
----------------
(i) any merchandise (including returned merchandise)
relating to any sale giving rise to such Receivable;
(ii) all security interests or liens and property
subject thereto from time to time purporting to secure
payment of such Receivable, whether pursuant to the Contract
related to such Receivable or otherwise, together with all
financing statements signed by an Obligor describing any
collateral securing such Receivable;
I-20
(iii) all guaranties, insurance and other agreements
or arrangements of whatever character from time to time
supporting or securing payment of such Receivable whether
pursuant to the Contract related to such Receivable or
otherwise; and
(iv) the Contract Documents and all other books,
records and other information (including, without
limitation, computer programs, tapes, discs, punch cards,
data processing software and related property and rights)
directly relating to such Receivable and the related
Obligor.
"Required Net Worth" means $20,000,000.
------------------
"Required Notice Days" means (i) two (2) Business Days in
--------------------
the case of a reduction of Net Investment of less than $10,000,000, (ii)
three (3) Business Days in the case of a reduction of Net Investment of
at least $10,000,000 and less than $20,000,000, (iii) five (5) Business
Days in the case of a reduction of Net Investment of at least
$20,000,000 and less than $50,000,000, and (iv) ten (10) Business Days
in the case of a reduction of Net Investment of $50,000,000 or more.
"Restricted Payments" has the meaning set forth in clause
------------------- -------
(m) of Exhibit IV to the Agreement.
- --- ----------
"S&P" means Standard & Poor's Ratings Group, a division of
---
The McGraw-Hill Companies, Inc., or its successor.
"Securitization Parties" means the Issuer, the
----------------------
Administrator, the Alternate Purchasers and their respective successors,
transferees and assigns.
"Seller" has the meaning set forth in the preamble to the
------
Agreement.
"Seller Report" means a report, in substantially the form
-------------
of Exhibit A to the Servicing Agreement, furnished by the Servicer to
---------
the Administrator pursuant to the Servicing Agreement.
"Servicer" has the meaning set forth in the preamble to
--------
the Agreement.
"Servicer Report Date" has the meaning set forth in the
--------------------
Servicing Agreement.
"Servicing Agreement" means the Servicing Agreement, dated
-------------------
as of the date hereof, among the Servicer, Seller and the Administrator,
as the same may be amended, supplemented or otherwise modified from time
to time.
"Servicing Fee" has the meaning set forth in the Servicing
-------------
Agreement.
I-21
"Servicing Fee Rate" has the meaning set forth in the
------------------
Servicing Agreement.
"Servicing Fee Reserve" means, on any date, the sum of (i)
---------------------
the accrued and unpaid Servicing Fee plus (ii) the product of (a) the
aggregate outstanding Capital of all Purchasers, multiplied by (b) the
Servicing Fee Rate on such date, multiplied by (c) the quotient of (I)
the sum of the Average Maturity plus the Collection Delay Period,
divided by 360, all as of such date.
"Settlement Date" means (a) initially, the 20th day of
---------------
each calendar month (or, if such day is not a Business Day, the
immediately succeeding Business Day) or such other day during the
calendar month as the Administrator may from time to time specify to the
Seller and the Servicer and (b) at the discretion of the Administrator,
each day as the Administrator may from time to time specify to the
Seller and the Servicer (it being understood that the Administrator may
select such Settlement Date to occur as frequently as daily) or, in the
absence of any such selection, the date which would be the Settlement
Date for such Portion of Capital pursuant to clause (a) of this
----------
definition.
"SPC Assignee" means a special purpose company, other than
------------
the Issuer, which (i) is administered by Bank of America or NationsBank
or any Affiliate thereof and (ii) has activities generally similar to
the Issuer.
"Subsidiary" means, for any Person, any other Person of
----------
which at least a majority of the voting stock is owned or controlled by
such Person or by one or more other Subsidiaries of such Person. For
purposes of this definition, the term "voting stock" shall mean capital
stock or other ownership interests having ordinary voting power under
ordinary circumstances for the election of directors (or the equivalent)
for such other Person.
"Tangible Net Worth" means with respect to any Person, the
------------------
total amount which in accordance with generally accepted accounting
principles would be included under "Shareholder's equity" on the balance
sheet of such Person.
"Termination Date" means the earlier of (i) the Business
----------------
Day which the Seller so designates by notice to the Administrator at
least sixty days in advance, (ii) the Facility Termination Date and
(iii) the Commitment Termination Date.
"Termination Day" means (i) each day that occurs during
---------------
the continuance of a Termination Event and (ii) each day which occurs on
or after the Termination Date.
"Termination Event" has the meaning specified in Exhibit V.
----------------- ----------
"Termination Fee" means, for any Fixed Period during which
---------------
either a Termination Day or a reduction of a Portion of Capital pursuant
to Section 1.4(f) occurs, the amount, if any, by which (i) the
additional Discount (calculated without taking into account any
Termination Fee
I-22
or any shortened duration of such Fixed Period pursuant to clause
------
(iii) of the definition thereof) which would have accrued during such
- -----
Fixed Period on the reductions of the Portion of Capital relating to
such Fixed Period had such reductions remained as part of such Portion
of Capital, exceeds (ii) the income, if any, received by the affected
Purchasers from their investment of the proceeds of such reductions, as
determined by such Purchasers, which determination shall be binding and
conclusive for all purposes, absent manifest error.
"Transaction Documents" means the Agreement, the Fee
---------------------
Letter, the Purchase and Sale Agreement, the Servicing Agreement, the
Liquidity Asset Purchase Agreement, the Collection Account Agreement,
the Lock-Box Agreements and all other certificates, instruments, UCC
financing statements, reports, notices, agreements and documents
executed or delivered under or in connection with the Agreement and the
Purchase and Sale Agreement, in each case as the same may be amended,
supplemented or otherwise modified from time to time in accordance with
the Agreement.
"Trigger Event" means (i) any Lock-Box Agreement is not
-------------
duly executed by all of the parties thereto at any time after July 30,
1999 or (ii) any effective financing statement or other instrument
similar in effect covers (including, without limitation, indirectly as
proceeds) any Pool Receivable or the Related Security at any time after
September 10, 1999, except those filed in favor of the Administrator
relating to the Agreement or in favor of the Seller relating to the
Purchase and Sale Agreement.
"UCC" means the Uniform Commercial Code as from time to
---
time in effect in the applicable jurisdiction.
"Unmatured Termination Event" means an event which, with
---------------------------
the giving of notice or lapse of time, or both, would constitute a
Termination Event.
"Year 2000 Compliant" has the meaning specified in
-------------------
paragraph (z) in Exhibit III.
- ------------- -----------
Other Terms. All accounting terms not specifically defined
-----------
herein shall be construed in accordance with generally accepted
accounting principles. 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. Unless the context otherwise requires,
"or" means "and/or", and "including" (and with correlative meaning
"include" and "includes") means including without limiting the
generality of any description preceding such term.
I-23
EXHIBIT II
CONDITIONS OF PURCHASES
1. Conditions Precedent to Initial Purchase. The initial
----------------------------------------
purchase under the Agreement is subject to the conditions precedent that
the Administrator shall have received on or before the date of such
purchase the following, each in form and substance (including the date
thereof) satisfactory to the Administrator:
(a) A counterpart of this Agreement and the other
Transaction Documents duly executed by the parties thereto.
(b) Certified copies of (i) the resolutions of the Board of
Directors of each of the Seller, the Servicer, the Guarantor and each
Originator authorizing the execution, delivery, and performance by such
Person of the Transaction Documents to which such Person is a party,
(ii) all documents evidencing other necessary corporate action and
governmental approvals, if any, with respect to the Transaction
Documents and (iii) the certificate or articles of incorporation and by-
laws of each such Person.
(c) A certificate of the Secretary or Assistant Secretary
of each of the Seller, the Servicer, the Guarantor and each Originator
certifying the names and true signatures of the officers of such Person
authorized to sign the Transaction Documents to which such Person is a
party. Until the Administrator receives a subsequent incumbency
certificate from such Person in form and substance satisfactory to the
Administrator, the Administrator shall be entitled to rely on the last
such certificate delivered to it by such Person.
(d) Originals of proper financing statements, duly
completed and executed for all jurisdictions that the Administrator may
deem necessary or desirable in order to perfect the interests of the
Seller and the Administrator, for the benefit of the Securitization
Parties, contemplated by the Agreement and the other Transaction
Documents.
(e) Acknowledgment copies, or time stamped receipt copies
of proper financing statements, if any, necessary to release all
security interests and other rights of any Person in the Pool
Receivables or Related Security previously granted by the Seller or any
Originator.
(f) Completed UCC requests for information, dated on or
before the date of such initial purchase, listing the financing
statements referred to in subsection (e) above and all other effective
--------------
financing statements filed in the jurisdictions referred to in
subsection (d) above that name the Seller or any Originator as debtor,
- --------------
together with copies of such other financing statements (none of which
shall cover any Pool Receivables or Related Security (except, with
respect to the financing statements listed on Annex E hereto,
-------
indirectly as proceeds) unless terminated or released), and similar
search reports with respect to federal tax liens and liens of
II-1
the Pension Benefit Guaranty Corporation in such jurisdictions as the
Administrator may request, showing no such liens on any of the Pool
Receivables or Related Security.
(g) Copies of the Collection Account Agreement and each
Lock-Box Agreement duly executed by the parties thereto (other than by
certain Lock-Box Banks which will duly execute such Lock-Box Agreements
promptly following the Effective Date).
(h) A favorable opinion of Rothgerber, Johnson & Lyons LLP,
counsel for the Seller, in form and substance satisfactory to the
Administrator.
(i) Favorable opinions of Rothgerber, Johnson & Lyons LLP,
counsel for each Originator, the Guarantor and the Servicer, in form and
substance satisfactory to the Administrator.
(j) Satisfactory results of a review and audit of the
Seller's, the Servicer's and each Originator's collection, operating and
reporting systems, Credit and Collection Policy, historical receivables
data and accounts, including satisfactory review and approval of the
Eligible Receivables in existence on the date of the initial purchase
under the Agreement.
(k) Evidence (i) of the execution and delivery by each of
the parties thereto of the Purchase and Sale Agreement and all
documents, agreements and instruments contemplated thereby (which
evidence shall include copies, either original or facsimile, of each of
such documents, instruments and agreements), (ii) that each of the
conditions precedent to the execution and delivery of the Purchase and
Sale Agreement has been satisfied to the Administrator's satisfaction,
and (iii) that the initial purchases under the Purchase and Sale
Agreement have been consummated.
(l) Evidence of payment by the Seller of all accrued and
unpaid fees (including those contemplated by the Fee Letter, costs and
expenses to the extent then due and payable on the date thereof,
together with Attorney Costs of the Administrator to the extent invoiced
prior to or on such date, plus such additional amounts of Attorney Costs
as shall constitute the Administrator's reasonable estimate of Attorney
Costs incurred or to be incurred by it through the closing proceedings
(provided that such estimate shall not thereafter preclude final
settling of accounts between the Seller and the Administrator),
including any such costs, fees and expenses arising under or referenced
in Section 4.4.
-----------
(m) The Fee Letter, duly executed by the parties thereto.
(n) Good standing certificates with respect to the Seller,
the Servicer, the Guarantor and each Originator by the Secretaries of
the States of their state of incorporation and the state in which their
principal place of business is located.
II-2
(o) Such other approvals, opinions or documents as the
Administrator or the Issuer may reasonably request.
2. Conditions Precedent to All Purchases and
------------------------------------------
Reinvestments. Each purchase (including the initial purchase) and each
- -------------
reinvestment shall be subject to the further conditions precedent that:
(a) in the case of each purchase, the Servicer shall have
delivered to the Administrator on or prior to such purchase, in form and
substance satisfactory to the Administrator, a completed Purchasing
Certificate dated within three (3) Business days prior to the date of
such purchase together with a listing by Obligor of all Pool Receivables
and such additional information as may reasonably be requested by the
Administrator;
(b) on the date of such purchase or reinvestment the
following statements shall be true (and acceptance of the proceeds of
such purchase or reinvestment shall be deemed a representation and
warranty by the Seller and the Servicer that such statements are then
true):
(i) the representations and warranties contained in
Exhibit III are true and correct in all material respects on and
-----------
as of the date of such purchase or reinvestment as though made on
and as of such date (except to the extent such representations and
warranties relate solely to an earlier date and then as of such
earlier date); and
(ii) no event has occurred and is continuing, or
would result from such purchase or reinvestment, that constitutes
a Termination Event or an Unmatured Termination Event; and
(c) the Administrator shall have received such other
approvals, opinions or documents as it may reasonably request.
II-3
EXHIBIT III
REPRESENTATIONS AND WARRANTIES
The Seller represents and warrants as follows:
(a) Organization and Good Standing. The Seller is a
------------------------------
corporation duly incorporated, validly existing and in good standing
under the laws of the State of Colorado, and is duly qualified to do
business, and is in good standing as a foreign corporation in every
jurisdiction where the nature of its business requires it to be so
qualified.
(b) Power and Authority; Due Authorization; No Violation.
----------------------------------------------------
The execution, delivery and performance by the Seller of the Agreement
and the other Transaction Documents to which it is a party, including
the Seller's use of the proceeds of purchases and reinvestments, (i) are
within the Seller's corporate powers, (ii) have been duly authorized by
all necessary corporate action, (iii) do not contravene or result in a
default under or conflict with (1) the Seller's charter or by-laws, (2)
any law, rule or regulation applicable to the Seller, except to the
extent such contravention, default or conflict will not have a Material
Adverse Effect, (3) any contractual restriction binding on or affecting
the Seller or its property or (4) any order, writ, judgment, award,
injunction or decree binding on or affecting the Seller or its property,
and (iv) do not result in or require the creation of any Adverse Claim
upon or with respect to any of its properties. The Agreement and the
other Transaction Documents to which it is a party have been duly
executed and delivered by the Seller.
(c) Government Approvals. No authorization or approval
--------------------
or other action by, and no notice to or filing with, any Governmental
Authority or other Person is required for the due execution, delivery
and performance by the Seller of the Agreement or any other Transaction
Document to which it is a party.
(d) Validity and Binding Nature. Each of the Agreement
---------------------------
and the other Transaction Documents to which it is a party constitutes
the legal, valid and binding obligation of the Seller enforceable
against the Seller in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
or other similar laws affecting the enforcement of creditors' rights
generally and by general principles of equity, regardless of whether
such enforceability is considered in a proceeding in equity or at law.
(e) Financial Condition. The balance sheets of Mail-
-------------------
Well, Inc. and its subsidiaries as at December 31, 1998, and the related
statements of income and retained earnings for the fiscal year then
ended, copies of which have been furnished to the Administrator, fairly
present the financial condition thereof as at such date and the results
of operations thereof for the period ended on such date, all in
accordance with generally accepted accounting principles consistently
applied, and since December 31, 1998 there has been no material adverse
change in the business, operations, property or financial or other
condition or operations of the Seller, the
III-1
Servicer, the Guarantor, any Originator, the ability of the Seller, the
Servicer, the Guarantor, or any Originator to perform its obligations
under the Agreement or the other Transaction Documents or the
collectibility of the Pool Receivables, or which affects the legality,
validity or enforceability of the Agreement or the other Transaction
Documents.
(f) No Proceedings. There is no pending or threatened
--------------
action or proceeding affecting the Seller or any of its Affiliates
before any Governmental Authority or arbitrator which could materially
adversely affect the business, operations, property, financial or other
condition or operations of the Seller or any of its Affiliates, the
ability of the Seller to perform its obligations under the Agreement or
the other Transaction Documents or the collectibility of the Pool
Receivables, or which affects or purports to affect the legality,
validity or enforceability of the Agreement or the other Transaction
Documents.
(g) Use of Proceeds. No proceeds of any purchase or
---------------
reinvestment will be used to acquire more than 5% of any class of any
security in any transaction which is subject to Sections 13 and 14 of
the Exchange Act of 1934, except for a nonhostile, invited Acquisition
of a Person (approved by the board of directors (or other body
exercising similar-authority) of such Person) by the Seller or any
Affiliate thereof, which does not violate any laws, rules or regulations
applicable thereto or any other provision of the Transaction Documents.
(h) Quality of Title. The Seller is the legal and
----------------
beneficial owner of the Pool Receivables and Related Security free and
clear of any Adverse Claim; upon each purchase or reinvestment, the
Administrator, for the benefit of the Securitization Parties, shall
acquire a valid and enforceable perfected undivided percentage ownership
interest, to the extent of the Purchased Interest, in each Pool
Receivable then existing or thereafter arising and in the Related
Security and Collections and other proceeds, with respect thereto, free
and clear of any Adverse Claim; the Agreement creates a security
interest in favor of the Securitization Parties in the items described
in Section 1.2(d), and the Securitization Parties have a first
--------------
priority perfected security interest in such items, free and clear of
any Adverse Claims. No effective financing statement or other
instrument similar in effect covering any Contract Document or any Pool
Receivable or the Related Security or Collections with respect thereto
or any Lock-Box Account or the Collection Account is on file in any
recording office, except those filed in favor of the Administrator
relating to the Agreement or in favor of the Seller relating to the
Purchase and Sale Agreement and except those which are both
(i) indirectly covering any Pool Receivable or the Related Security as
proceeds which will be released or terminated within 60 days after the
Effective Date and (ii) listed on Annex E hereto.
-------
(i) Accuracy of Information. Each Seller Report,
-----------------------
certificate, exhibit, financial statement, document, book, record,
report or other information furnished or to be furnished at any time by
or on behalf of the Seller to any Securitization Party in connection
with the Agreement is or will be accurate in all material respects as of
its date or as of the date so furnished, and no such item contains or
will contain any untrue statement of a material fact or
III-2
omits or will omit to state a material fact necessary in order to make
the statements contained therein, in the light of the circumstances
under which they were made, not misleading.
(j) Offices. The principal place of business and chief
-------
executive office (as such terms are used in the UCC) of the Seller and
the office where the Seller keeps its records concerning the Receivables
are located at the addresses referred to in paragraph (b) of Exhibit IV.
------------- -----------
(k) Governmental Authority. The Seller is not in
----------------------
violation of any order of any court, arbitrator or Governmental
Authority which could have a Material Adverse Effect.
(l) Lock-Box Banks and Collection Account Bank. The
------------------------------------------
names and addresses of all the Lock-Box Banks and Collection Account
Bank, together with the account numbers of the related Lock-Box Accounts
or Collection Account, as applicable, are specified in Schedule I to
----------
the Agreement (or at such other Lock-Box Banks or Collection Account
Bank, as applicable, and/or with such other Lock-Box Accounts or
Collection Account, as applicable, as have been notified to the
Administrator in accordance with the Agreement) and the Collection
Account is subject to the Collection Account Agreement and all Lock-Box
Accounts are subject to Lock-Box Agreements, duly executed by the
parties thereto (in the case of certain Lock-Box Banks, within 30 days
after the date hereof).
(m) Federal Reserve Regulations. No proceeds of any
---------------------------
purchase or reinvestment will be used for any purpose that violates any
applicable law, rule or regulation, including, without limitation,
Regulations T, U and X of the Federal Reserve Board.
(n) Eligible Receivables. Each Pool Receivable included
--------------------
as an Eligible Receivable in the calculation of the Net Receivables Pool
Balance, is an Eligible Receivable.
(o) No Termination Event. No event has occurred and is
--------------------
continuing, or would result from a purchase or reinvestment by any
Purchaser hereunder or from the application of the proceeds therefrom,
which constitutes a Termination Event.
(p) Accounting as Sales. The Seller has accounted for
-------------------
each sale of undivided percentage ownership interests in the Pool
Receivables in its books and financial statements as a sale, consistent
with generally accepted accounting principles.
(q) Compliance With Credit and Collection Policy. The
--------------------------------------------
Seller has complied in all material respects with the Credit and
Collection Policy in effect at the time with regard to each Pool
Receivable.
(r) Compliance with Transaction Documents. The Seller
-------------------------------------
has complied in all material respects with all of the terms, covenants
and agreements contained in the Agreement and the other Transaction
Documents and applicable to it.
III-3
(s) Trade Names. The Seller's complete corporate name is
-----------
set forth in the preamble to the Agreement, and the Seller does not use
and has not during the last five years used any other corporate name,
trade name, doing business name or fictitious name, except for names
first used after the date of the Agreement and set forth in a notice
delivered to the Administrator pursuant to paragraph (b)(iii) of
------------------
Exhibit IV.
- ----------
(t) Capitalization. The authorized capital stock of
--------------
Seller consists of 1000 shares of common stock, $.01 par value, all of
which shares are currently issued and outstanding. All of such
outstanding shares are validly issued, fully paid and nonassessable and
are owned (beneficially and of record) by Mail-Well I Corporation.
(u) Taxes. The Seller has filed all federal and other
-----
tax returns and reports required by law to have been filed by it and has
paid all taxes and governmental charges thereby shown to be owing.
(v) Bulk Sales Act. No transaction contemplated by this
--------------
Agreement or any other Transaction Document requires compliance with, or
will be subject to avoidance under, any bulk sales act or similar law.
(w) Investment Company Act. Seller is not an "investment
----------------------
company" within the meaning of the Investment Company Act of 1940, as
amended, or a "holding company," or a "subsidiary company" of a "holding
company," or an affiliate of a "holding company," or a "subsidiary
company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(y) All Consents Required. All approvals, authorizations,
---------------------
consents, orders or other actions of or notices to or filings with any
Person or any Governmental Authority required in connection with the
execution and delivery by the Seller of this Agreement or the other
Transaction Documents, the performance by the Seller of the transactions
contemplated hereby and thereby and the fulfillment by the Seller of the
terms hereof and thereof, have been duly obtained and are in full force
and effect.
(z) Year 2000 Compliance. Any reprogramming required to
--------------------
permit the proper functioning, in and following the year 2000, of the
computer application systems used to conduct, operate and manage the
business, assets and operations of the Seller, as so reprogrammed, will
be completed by September 30, 1999 ,unless failure to complete such
reprogramming could not reasonably be expected to have a Material
Adverse Effect. With respect to any computer hardware, the Seller: (i)
has initiated a review and assessment of all areas within the Seller's
business and operations, (ii) has developed a plan and timeline for
addressing any problems which would cause it not to be able to properly
recognize and process date-sensitive information for all dates before
and after January 1, 2000 ("Year 2000 Compliant") on a timely basis,
-------------------
(iii) to date, has implemented such plan in accordance with such
timetable and (iv) believes, based upon the foregoing, that the Seller
will be Year 2000 Compliant prior to
III-4
January 1, 2000. There are no additional costs to the Seller relating
to becoming Year 2000 Compliant that will result in a Termination Event
or have a Material Adverse Effect. The computer and management
information systems used to conduct, operate and manage the business,
assets and operations of the Seller are and with ordinary course
upgrading and maintenance (and with any additions to accommodate
growth), will continue for the term of this Agreement to be, sufficient
to permit the Seller to conduct its business without having a Material
Adverse Effect.
(aa) Insolvency. (i) The fair value of the property of
----------
the Seller is greater than the total amount of liabilities, including
contingent liabilities, of the Seller, (ii) the present fair salable
value of the assets of the Seller is not less than the amount that will
be required to pay all probable liabilities of the Seller on its debts
as they become absolute and matured, (iii) the Seller does not intend
to, and does not believe that it will, incur debts or liabilities beyond
the Seller's abilities to pay such debts and liabilities as they mature,
(iv) the Seller is not engaged in a business or a transaction, and is
not about to engage in a business or a transaction, for which the
Seller's property would constitute unreasonably small capital and (v)
the transfer of the Purchased Interest by the Seller will not render the
Seller insolvent.
(bb) Pension Plans. During the preceding twelve months,
-------------
no steps have been taken to terminate any Pension Plan, and no
contribution failure has occurred with respect to any Pension Plan
sufficient to give rise to a lien under section 302(f) of ERISA. No
condition exists or event or transaction has occurred with respect to
any Pension Plan which could result in the incurrence by the Seller of
any material liability, fine or penalty. The Seller has no contingent
liability with respect to any post-retirement benefit under a "welfare
plan" as defined in Section 3(1) of ERISA, other than liability for
continuation coverage described in Part 6 of title I of ERISA.
(cc) Separate Existence. The Facts and Assumptions with
------------------
respect to the Seller are true and correct.
III-5
EXHIBIT IV
COVENANTS
Covenants. Until the Final Pay Out Date:
---------
(a) Compliance with Laws, Etc. The Seller shall comply
--------------------------
in all material respects with all applicable laws, rules, regulations
and orders, and preserve and maintain its corporate existence, rights,
franchises, qualifications, and privileges except to the extent that the
failure so to comply with such laws, rules and regulations or the
failure so to preserve and maintain such existence, rights, franchises,
qualifications, and privileges would not have a Material Adverse Effect.
(b) Offices, Records and Books of Account; Etc. The
-------------------------------------------
Seller (i) shall keep its principal place of business and chief
executive office (as such terms are used in the UCC) at the address of
the Seller set forth under its name on the signature page to the
Agreement and the office where it keeps its records concerning the Pool
Receivables at such address or one of the locations specified in
Schedule III hereto or, upon at least 60 days' prior written notice of
- ------------
a proposed change to the Administrator, at any other locations in
jurisdictions where all actions reasonably requested by the
Administrator to protect and perfect the interest of the Issuer in the
Pool Receivables and related items (including, without limitation, the
items described in Section 1.2(d)) have been taken and completed and
--------------
(ii) shall provide the Administrator with at least 60 days' written
notice prior to making any change in the Seller's name or making any
other change in the Seller's identity or corporate structure (including,
without limitation, a merger) which could render any UCC financing
statement filed in connection with this Agreement "seriously misleading"
as such term is used in the UCC; each notice to the Administrator
pursuant to this sentence shall set forth the applicable change and the
effective date thereof. The Seller also will maintain and implement
administrative and operating procedures (including, without limitation,
an ability to recreate records evidencing Pool Receivables in the event
of the destruction of the originals thereof), and keep and maintain all
documents, books, records, computer tapes and disks and other
information reasonably necessary or advisable for the collection of all
Pool Receivables (including, without limitation, records adequate to
permit the daily identification of each Pool Receivable and all
Collections of and adjustments to each existing Pool Receivable).
(c) Performance and Compliance with Receivables and
-----------------------------------------------
Credit and Collection Policy. The Seller shall, at its expense, timely
- ----------------------------
and fully perform and comply with all material provisions, covenants and
other promises required to be observed by it under the Pool Receivables,
and timely and fully comply in all material respects with the Credit and
Collection Policy with regard to each Pool Receivable.
IV-1
(d) Ownership Interest, Etc. The Seller shall, at its
------------------------
expense, take all action necessary or desirable to establish and
maintain (i) a valid and enforceable perfected undivided ownership
interest in favor of the Administrator, for the benefit of the
Securitization Parties, to the extent of the Purchased Interests, in the
Pool Receivables and the Related Security and Collections and other
proceeds with respect thereto, and (ii) a first priority perfected
security interest in favor of the Administrator, for the benefit of the
Securitization Parties, in the items described in Section 1.2(d), in
--------------
each case free and clear of any Adverse Claim, including, without
limitation, taking such action to perfect, protect or more fully
evidence the interests of the Securitization Parties under the Agreement
as the Securitization Parties may request.
(e) Sales, Liens, Etc. The Seller shall not sell,
------------------
assign (by operation of law or otherwise) or otherwise dispose of, or
create or suffer to exist any Adverse Claim upon or with respect to, any
or all of its right, title or interest in, to or under, any item
described in Section 1.2(d) (including, without limitation, the
--------------
Seller's undivided interest in any Pool Receivable, Related Security, or
Collections, or upon or with respect to any account to which any
Collections of any Pool Receivables are sent), or assign any right to
receive income in respect of any items contemplated by this paragraph (e).
-------------
(f) Extension or Amendment of Receivables. Except as
-------------------------------------
provided in the Agreement or the Servicing Agreement, neither the Seller
nor the Servicer shall extend the maturity or adjust the Outstanding
Principal Balance or otherwise amend, modify or waive the terms of any
Pool Receivable.
(g) Change in Business or Credit and Collection Policy.
--------------------------------------------------
The Seller shall not make any material change in the character of its
business or in the Credit and Collection Policy, or any change in the
Credit and Collection Policy that would adversely affect the
collectibility or enforceability of any Pool Receivable or the ability
of the Seller to perform its obligations, if any, under any Pool
Receivable or under the Agreement or the other Transaction Documents to
which it is a party, without the prior written consent of the
Administrator.
(h) Audits. The Seller shall, from time to time during
------
regular business hours as reasonably requested by the Administrator,
permit the Administrator, or its agents or representatives, (i) to
examine and make copies of and abstracts from all books, records and
documents (including, without limitation, computer tapes and disks) in
the possession or under the control of the Seller relating to
Receivables and the Related Security, and (ii) to visit the offices and
properties of the Seller for the purpose of examining such materials
described in clause (i) above, and to discuss matters relating to Pool
Receivables and the Related Security with any of the officers,
employees, agents or contractors of the Seller having knowledge of such
matters, and shall permit and cooperate with an annual (or more
frequently if reasonably required by the Administrator) audit (conducted
at the Seller's expense) of the Seller by the Administrator and the
independent accountants selected thereby.
IV-2
(i) Lock-Box Accounts and Collection Account. (i) The
----------------------------------------
Seller shall not add or terminate any bank as a Lock-Box Bank or any
account as a Lock-Box Account from those listed in Schedule I to the
----------
Agreement, or make any change in its instructions to Obligors regarding
payments to be made to the Seller or payments to be made to any Lock-Box
Account (or related post office box), unless the Administrator shall
have consented thereto in writing and the Administrator shall have
received copies of all agreements and documents (including, without
limitation, Lock-Box Agreements) that it may request in connection
therewith.
(ii) The Seller shall (A) instruct all Obligors to make
payments of all Receivables to one or more Lock-Box Accounts or to
post office boxes to which only Lock-Box Banks have access (and
shall instruct the Lock-Box Banks to cause all items and amounts
relating to such Receivables received in such post office boxes to
be removed and deposited into a Lock-Box Account on a daily
basis), and (B) deposit, or cause to be deposited, any Collections
(other than those described in clause (b) of the definition
thereof) of Pool Receivables received by it into Lock-Box Accounts
not later than two Business Days after receipt thereof. Each
Lock-Box Account shall at all times be subject to a Lock-Box
Agreement.
(iii) The Seller shall not add or terminate any bank as a
Collection Account Bank or any account as a Collection Account
from those listed in Schedule I to the Agreement, unless the
----------
Administrator shall have consented thereto in writing and the
Administrator shall have received copies of all agreements and
documents (including, without limitation, Collection Account
Agreements) that it may request in connection therewith.
(iv) Each Collection Account shall at all times be subject
to a Collection Agreement. The Seller will not deposit or
otherwise credit, or cause or permit to be so deposited or
credited, to any Collection Account cash or cash proceeds other
than Collections.
(j) Marking of Records. At its expense, the Seller (or
------------------
the Servicer on its behalf) shall mark (a) its master data processing
records and storage cabinets relating to Pool Receivables, including
with a legend evidencing that the undivided percentage ownership
interests in such Pool Receivables have been sold in accordance with the
Agreement and (b) at the request of the Administrator, each Pool
Receivable with a legend, in form satisfactory to the Administrator, to
the effect that such Pool Receivable (or an undivided interest thereon)
has been sold in accordance with this Agreement.
(k) Separate Corporate Existence. The Seller hereby
----------------------------
acknowledges that the Securitization Parties are entering into the
transactions contemplated by the Agreement in reliance upon the Seller's
identity as a legal entity separate from the Servicer, the Guarantor and
each Originator. Therefore, from and after the date hereof, the Seller
shall take all reasonable steps to continue the Seller's identity as a
separate legal entity and to make it apparent to third Persons that the
Seller is an entity with assets and liabilities distinct from those of
the Servicer,
IV-3
the Guarantor, any Originator and any other Person, and is not a
division of the Servicer, the Guarantor, any Originator or any other
Person. Without limiting the generality of the foregoing and in
addition to and consistent with the covenant set forth in
paragraph (a) of this Exhibit IV, the Seller shall take such actions
- ------------- ----------
as shall be required in order that:
(i) The Seller will be a limited purpose corporation whose
primary activities are restricted in its certificate of
incorporation to purchasing Receivables from the Originators,
entering into agreements for the servicing of such Receivables,
selling undivided interests in such Receivables and conducting
such other activities as it deems necessary or appropriate to
carry out its primary activities;
(ii) Not less than one member of the Seller's Board of
Directors (the "Independent Director") shall be an individual
--------------------
who is not direct, indirect or beneficial stockholder, officer,
director, employee, affiliate, associate, customer or supplier of
the Servicer, the Guarantor or any Originator or any of their
Affiliates, except that such member may be an independent director
of a limited purpose bankruptcy-remote Affiliate of the Servicer,
the Guarantor or an Originator. The Seller's Board of Directors
shall not approve, or take any other action to cause the
commencement of a voluntary case or other proceeding with respect
to the Seller under any applicable bankruptcy, insolvency,
reorganization, debt arrangement, dissolution or other similar
law, or the appointment of or taking possession by, a receiver,
liquidator, assignee, trustee, custodian, or other similar
official for the Seller unless in each case the Independent
Director shall approve the taking of such action in writing prior
to the taking of such action. To the extent permissible under
Colorado law, the Independent Director's fiduciary duty shall be
to the Seller (and creditors) and not to the Seller's shareholders
in respect of any decision of the type described in the preceding
sentence. In the event the Independent Director resigns or
otherwise ceases to be a director of the Seller, there shall be
selected a replacement Independent Director who shall not be an
individual within the proscriptions of the first sentence of this
clause (ii) or any individual who has any other type of
-----------
professional relationship with the Servicer, the Guarantor, any
Originator or any Affiliates thereof or any management personnel
of any such Person or Affiliate and who shall be (x) a tenured
professor at a business or law school, (y) a retired judge or (z)
an established independent member of the business community,
having a sound reputation and experience relative to the duties to
be performed by such individual as an Independent Director;
(iii) No Independent Director shall at any time serve as a
trustee in bankruptcy for the Servicer, the Guarantor, any
Originator or any Affiliate thereof;
(iv) Any employee, consultant or agent of the Seller will
be compensated from the Seller's own bank accounts for services
provided to the Seller except as provided herein in respect of the
Servicer's Fee. The Seller will engage no agents other than a
servicer for the Pool Receivables, which servicer will be fully
compensated for its services to Seller by payment of the
Servicer's Fee;
IV-4
(v) The Seller will contract with Servicer to perform for
the Seller all operations required on a daily basis to service its
Receivables. The Seller will pay Servicer a monthly fee based on
the level of Receivables being managed by Servicer. To the
extent, if any, that the Seller, the Guarantor, any Originator or
any Affiliate thereof share items of expenses not reflected in the
Servicer's Fee, such as legal, auditing and other professional
services, such expenses will be allocated to the extent practical
on the basis of actual use or the value of services rendered, and
otherwise on a basis reasonably related to the actual use or the
value of services rendered, it being understood that Mail-Well I
Corporation shall pay all expenses relating to the preparation,
negotiation, execution and delivery of the Transaction Documents,
including, without limitation, legal and other fees;
(vi) The Seller's operating expenses will not be paid by
the Servicer, the Guarantor, any Originator or any Affiliate
thereof unless the Seller shall have agreed in writing with such
Person to reimburse such Person for any such payments;
(vii) The Seller will have its own separate mailing address
and stationery;
(viii) The Seller's books and records will be maintained
separately from those of the Servicer, the Guarantor, any
Originator or any Affiliate thereof;
(ix) Any financial statements of the Servicer, the
Guarantor, any Originator or any Affiliate thereof which are
consolidated to include the Seller will contain detailed notes
clearly stating that the Seller is a separate corporate entity and
has sold ownership interests in the Seller's accounts receivable;
(x) The Seller's assets will be maintained in a manner that
facilitates their identification and segregation from those of the
Servicer, the Guarantor, any Originator and any Affiliate thereof;
(xi) The Seller will strictly observe corporate formalities
in its dealings with the Servicer, the Guarantor, any Originator
and any Affiliate thereof, and funds or other assets of the Seller
will not be commingled with those of the Guarantor, any Originator
or any Affiliate thereof (other than in their capacity as Servicer
or sub-servicer). Seller shall not maintain joint bank accounts
or other depository accounts to which the Guarantor, any
Originator or any Affiliate thereof (other than in their capacity
as Servicer or sub-servicer) has independent access. None of the
Seller's funds will at any time be pooled with any funds of the
Servicer, the Guarantor or any Originator or any Affiliate
thereof;
(xii) The Seller shall pay to the Servicer, the Guarantor or
applicable Originator the marginal increase (or, in the absence of
such increase, the market amount of its portion) of the premium
payable with respect to any insurance policy that covers the
Seller and any Affiliate thereof, but the Seller shall not,
directly or indirectly, be named or enter into an agreement to be
named, as a direct or contingent beneficiary or loss payee,
IV-5
under any such insurance policy, with respect to any amounts
payable due to occurrences or events related to the Servicer, the
Guarantor, any Originator or any Affiliate thereof; and
(xiii) The Seller will maintain arm's length relationships
with the Servicer, the Guarantor, any Originator and any Affiliate
thereof. The Servicer, the Guarantor, any Originator or any
Affiliate thereof that renders or otherwise furnishes services to
the Seller will be compensated by the Seller at market rates for
such services. Neither the Seller nor the Servicer, the
Guarantor, any Originator or any Affiliate thereof will be or will
hold itself out to be responsible for the debts of the other or
the decisions or actions respecting the daily business and affairs
of the other.
(xiv) The Seller shall not cause, or take any action, or
omit to take any action, that would be inconsistent with the Facts
and Assumptions.
(l) Mergers, Acquisitions, Sales, etc. The Seller shall not:
---------------------------------
(A) be a party to any merger or consolidation, or
directly or indirectly purchase or otherwise acquire,
whether in one or a series of transactions, all or
substantially all of the assets or any stock of any class
of, or any partnership or joint venture interest in, any
other Person, or sell, transfer, assign, convey or lease any
of its property and assets (including, without limitation,
any Pool Receivable or any interest therein) other than
pursuant to this Agreement;
(B) make, incur or suffer to exist an investment in,
equity contribution to, loan, credit or advance to, or
payment obligation in respect of the deferred purchase price
of property from, any other Person, except for Permitted
Investments and obligations incurred pursuant to the
Transaction Documents; or
(C) create any direct or indirect subsidiary or
otherwise acquire direct or indirect ownership of any equity
interests in any other Person.
(m) Restricted Payments.
-------------------
(i) General Restriction. Except in accordance with this
-------------------
paragraph (m), the Seller shall not (A) purchase or redeem any
-------------
shares of its capital stock, (B) declare or pay any Dividend or
set aside any funds for any such purpose, (C) prepay, purchase or
redeem any subordinated indebtedness of the Seller, (D) lend or
advance any funds or (E) repay any loans or advances to, for or
from the Servicer, the Guarantor or any Originator. Actions of
the type described in this clause (i) are herein collectively
----------
called "Restricted Payments".
-------------------
IV-6
(ii) Types of Permitted Payments. Subject to the
---------------------------
limitations set forth in clause (iii) below, the Seller may make
------------
Restricted Payments so long as such Restricted Payments are made
only to an Originator and only in the form of payments under the
Originator Notes.
(iii) Specific Restrictions. The Seller may make
---------------------
Restricted Payments only out of Collections paid or released to
the Seller pursuant to Section 1.4(b)(ii) or 1.4(c)(ii)(D).
------------------ -------------
Furthermore, the Seller shall not pay make:
(A) any payments on the Originator Notes if, after
giving effect thereto, the Seller's Tangible Net Worth would
be less than Required Net Worth; or
(B) any Restricted Payment (including any payments on
the Originator Notes) if, after giving effect thereto, any
Termination Event or Unmatured Termination Event shall have
occurred and be continuing.
(n) Amendments to Certain Documents. (i) The Seller
-------------------------------
shall not amend, supplement, terminate, amend and restate, or otherwise
modify any Transaction Document or the Seller's certificate of
incorporation or by-laws, except (A) in accordance with the terms of
such document, instrument or agreement and (B) with the advance written
consent of the Administrator.
(ii) The Seller shall not enter into, execute and deliver,
or otherwise become bound by, any agreement, instrument, document
or other arrangement that restricts its right to amend,
supplement, amend and restate or otherwise modify, or to extend or
renew, or to waive any right under, this Agreement or any other
Transaction Document.
(o) Incurrence of Indebtedness. The Seller shall not
--------------------------
(i) create, incur or permit to exist, any Debt or liability or (ii)
cause or permit to be issued for its account any letters of credit or
bankers' acceptances, except for Debt incurred in the ordinary course of
business and not exceeding $5,000 and liabilities incurred pursuant to
or in connection with the Transaction Documents or otherwise permitted
therein.
(p) Reporting Requirements. The Seller will provide to
----------------------
the Administrator (in multiple copies, if requested by the
Administrator) the following:
(i) as soon as available and in any event within
45 days after the end of the first three quarters of each
fiscal year (beginning with the quarter ended June 30, 1999)
of Mail-Well, Inc., balance sheets of Mail-Well, Inc. and
its subsidiaries as of the end of such quarter and
statements of income and retained earnings thereof for the
period commencing at the beginning of such previous fiscal
year and ending with the end of such quarter, certified by
the treasurer or assistant treasurer thereof (as
applicable);
IV-7
(ii) as soon as available and in any event
within 90 days after the end of each fiscal year (beginning
with the year ended December 31, 1999) of Mail-Well, Inc., a
copy of the annual report for such year for Mail-Well, Inc.
and its subsidiaries containing financial statements for
such year audited by nationally-recognized independent
certified public accountants;
(iii) as soon as available and in any event not
later than the Servicer Report Date, a Seller Report as of
the Monthly Period ended immediately prior to such Servicer
Report Date;
(iv) as soon as possible and in any event within
five days after the occurrence of each Termination Event or
Unmatured Termination Event, a statement of the treasurer or
assistant treasurer of the Seller setting forth details of
such Termination Event or Unmatured Termination Event, and
the action that the Seller has taken and proposes to take
with respect thereto;
(v) promptly after the sending or filing
thereof, copies of all reports that may be material to the
transactions contemplated hereby that the Servicer, the
Guarantor or any Originator sends to any of its security
holders, and copies of all reports and registration
statements that the Servicer, the Guarantor or any
Originator or any subsidiary thereof files with the
Securities and Exchange Commission or any national
securities exchange;
(vi) promptly after the filing by the Seller or
receiving notice or knowledge thereof, copies of all reports
and notices that the Seller or any Affiliate files under
ERISA with the Internal Revenue Service or the Pension
Benefit Guaranty Corporation or the U.S. Department of Labor
or that the Seller or any Affiliate receives from any of the
foregoing or from any multiemployer plan (within the meaning
of Section 4001(a)(3) of ERISA) to which the Seller or any
Affiliate is or was, within the preceding five years, a
contributing employer, in each case in respect of the
assessment of withdrawal liability or an event or condition
which could, in the aggregate, result in the imposition of
liability on the Seller and/or any such Affiliate in excess
of $500,000 or which could have a Material Adverse Effect;
(vii) at least 60 days prior to any change in
the Seller's name or any other change requiring the
amendment of UCC financing statements, a notice setting
forth such changes and the effective date thereof;
(viii) such other information respecting the
Receivables (including, without limitation, a Seller Report
on a more frequent basis than provided in clause (iii)
above) or the condition or operations, financial or
otherwise, of the
IV-8
Seller or any of its Affiliates as the Administrator may
from time to time reasonably request;
(ix) promptly after the Seller obtains knowledge
thereof, notice of any (a) litigation, investigation or
proceeding which may exist at any time between the Seller
and any Governmental Authority which, if not cured or if
adversely determined, as the case may be, could have a
Material Adverse Effect; or (b) litigation or proceeding
affecting (i) the Seller, the Servicer, the Guarantor or any
Originator in which the amount involved is $100,000 or more
and, which is not covered by insurance or in which
injunctive or similar relief is sought or (c) litigation or
proceedings relating to any Transaction Document; and
(x) promptly after the occurrence thereof,
notice of a material adverse change in the business,
operations, property or financial or other condition of the
Seller, the Servicer, the Guarantor or any Originator.
(q) Year 2000 Compliance. The Seller shall promptly
--------------------
notify the Administrator in the event the Seller discovers or determines
that any computer application (including those of its suppliers or
vendors) that is material to its business and operations will not be
Year 2000 Compliant on a timely basis, except to the extent that any
such failure to comply could not reasonably be expected to have a
Material Adverse Effect and could not reasonably be expected to cause a
Termination Event.
(r) ERISA Matters. The Seller shall notify the
-------------
Administrator as soon as is practicable and in any event not later than
two Business Days after (i) the institution of any steps by the Seller
or any other Person to terminate any Pension Plan, (ii) the failure to
make a required contribution to any Pension Plan if such failure is
sufficient to give rise to a lien under section 302(f) of ERISA,
(iii) the taking of any action with respect to a Pension Plan which
could result in the requirement that the Seller furnish a bond or other
security to the PBGC or such Pension Plan or (iv) the occurrence of any
event with respect to any Pension Plan which could result in the
incurrence by the Seller of any material liability, fine or penalty, or
any material increase in the contingent liability of the Seller with
respect to any post-retirement "welfare plan" (as defined in Section
3(1) of ERISA) benefit.
IV-9
EXHIBIT V
TERMINATION EVENTS
Each of the following shall be a "Termination Event":
-----------------
(a) The rating of the $300,000,000 senior subordinated notes
due December 15, 2008 issued by Mail-Well I Corporation shall fall below
"B" by S&P or "B2" by Moody's (or any such rating has been withdrawn or
suspended); or
(b) The Seller, the Servicer, the Guarantor or any
Originator shall fail to make any payment required under the Agreement
or under any other Transaction Document, and such failure shall remain
unremedied for more than one Business Day after the Seller, the
Servicer, the Guarantor or any Originator had actual knowledge or notice
thereof, or should have known, after the exercise of reasonable
diligence, thereof; or
(c) Any representation or warranty made or deemed made by
the Seller, the Servicer, the Guarantor or any Originator (or any of
their respective officers) under or in connection with the Agreement or
any other Transaction Document or any other writing or certificate
delivered by the Seller, the Servicer, the Guarantor or any Originator
pursuant to such Transaction Document shall prove to have been incorrect
or untrue in any material respect when made or deemed made or delivered
and shall remain incorrect or untrue for more than 10 days after the
Seller, the Servicer, the Guarantor or any Originator had actual
knowledge or notice thereof, or should have known, after the exercise of
reasonable diligence, thereof; or
(d) The Seller, the Servicer, the Guarantor or any
Originator shall fail in any material respect to perform or observe any
other term, covenant or agreement contained in the Agreement or any
other Transaction Document on its part to be performed or observed and
any such failure shall remain unremedied for ten days (or, with respect
to a failure to deliver the Seller Report pursuant to the Agreement,
such failure shall remain unremedied for five days) after the Seller,
the Servicer, the Guarantor or any Originator had actual knowledge or
notice thereof, or should have known, after the exercise of reasonable
diligence, thereof; or
(e) The Seller, the Servicer, the Guarantor or any
Originator shall fail to pay any principal of or premium or interest on
any of its Debt which is outstanding in a principal amount of at least
$5,000,000 (or, with respect to the Seller, $100,000)in the aggregate
when the same becomes due and payable (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 event shall occur or condition shall exist under any agreement or
instrument relating to any such Debt and shall continue after the
applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to accelerate,
or to permit the acceleration
V-1
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 repay, redeem, purchase or defease such Indebtedness shall be
required to be made, in each case prior to the stated maturity thereof;
or
(f) This Agreement or any purchase or any reinvestment
pursuant to this Agreement shall for any reason (other than pursuant to
the terms hereof) (i) cease to create, or the Purchased Interests of the
Purchasers shall for any reason cease to be, a valid and enforceable
perfected undivided percentage ownership interest to the extent of such
Purchased Interests in the Receivables Pool and the Related Security and
Collections and other proceeds with respect thereto, free and clear of
any Adverse Claim or (ii) cease to create with respect to the items
described in Section 1.2(d), or the interest of the Securitization
--------------
Party with respect to such items shall cease to be, a valid and
enforceable first priority perfected security interest, free and clear
of any Adverse Claim; or
(g) The Seller, the Servicer, the Guarantor, any Originator
or any Affiliate thereof 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, the Servicer, the Guarantor, any Originator or any Affiliate
thereof 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, custodian or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it), either such
proceeding shall remain undismissed or unstayed for a period of 30 days,
or any of the actions sought in such proceeding (including, without
limitation, the entry of an order for relief against, 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 the Seller,
the Servicer, the Guarantor, any Originator or any Affiliate thereof
shall take any corporate action to authorize any of the actions set
forth above in this paragraph (g); or
-------------
(h) (i) The arithmetic mean of the Default Ratios for the
three most recent Monthly Periods shall equal or exceed 5.0%; or
(ii) The Dilution Ratio shall equal or exceed 9.0%; or
(i) The aggregate of the Purchased Interests of all
Purchasers (expressed as a percentage) shall exceed 100% (in each case
calculated as though the "NRB" included the aggregate amount of
Collections held in trust by the Servicer in the Collection Account for
the benefit of the applicable Purchasers for payment to such Purchaser
as a reduction of the Capital of such Purchaser on the next Settlement
Date); or
V-2
(j) The Internal Revenue Service shall file notice of a
lien pursuant to Section 6323 of the Internal Revenue Code with regard
to any of the assets of the Seller, the Servicer, the Guarantor or any
Originator, or the Pension Benefit Guaranty Corporation shall, or shall
indicate its intention to, file notice of a lien pursuant to
Section 4068 of ERISA with regard to any of the assets of the Seller,
the Servicer, the Guarantor or any Originator; or
(k) (i) Any Transaction Document, or any ownership or other
interest granted or created thereunder, shall (except in accordance with
its terms), in whole or in part, terminate, cease to be effective or
cease to be the legally valid, binding and enforceable obligation of the
Seller, the Servicer, the Guarantor or any Originator or (ii) the
Seller, the Servicer, the Guarantor or any Originator shall, directly or
indirectly, contest in any manner such effectiveness, validity, binding
nature or enforceability; or
(l) A Purchase and Sale Termination Event under the
Purchase and Sale Agreement shall have occurred and be continuing; or
(m) Any Change in Control shall have occurred; or
(n) Any event or circumstance has a material adverse effect
on the validity, enforceability or collectibility of any material
portion of the Pool Receivables or the ability of the Servicer to
collect such Pool Receivables; or
(o) A material adverse change in the financial condition,
operations or prospects shall have occurred with respect to the Seller,
the Servicer, the Guarantor or any Originator; or
(p) The Tangible Net Worth of the Seller falls below the
Required Net Worth.
V-3
FIRST AMENDMENT TO RECEIVABLES PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO RECEIVABLES PURCHASE AGREEMENT, dated as
of July 1, 1999 (the "Amendment"), is entered into among MAIL-WELL
---------
TRADE RECEIVABLES CORPORATION, a Colorado corporation, as seller (the
"Seller"), MAIL-WELL I CORPORATION, a Delaware corporation, as initial
------
Servicer (the "Servicer"), QUINCY CAPITAL CORPORATION, a Delaware
--------
corporation (the "Issuer"), the Alternate Purchasers from time to time
------
party thereto (the "Alternate Purchasers") and BANK OF AMERICA,
--------------------
NATIONAL ASSOCIATION (f/k/a BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION), a national banking association, as administrator (the
"Administrator").
-------------
R E C I T A L S
- - - - - - - -
A. The Seller, the Servicer, the Issuer, the Alternate
Purchasers and the Administrator are parties to Receivables Purchase
Agreement, dated as of July 1, 1999 (the "Agreement"); and
---------
B. The parties to the Agreement desire to amend the Agreement
as set forth herein.
NOW THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Certain Defined Terms. Capitalized terms used but not
---------------------
defined herein shall have the meanings set forth for such terms in
Exhibit I to the Agreement.
2. Amendments to the Agreement. The Agreement is hereby
---------------------------
amended as follows:
2.1 The introductory paragraph of the Agreement is hereby
amended by adding, immediately after the parenthetical defining
"Bank of America", the following phrase:
, HARRIS TRUST AND SAVINGS BANK, THE BANK OF NOVA SCOTIA
2.2 A new Section 4.15 is hereby added to the Agreement to
be and to read as follows:
Section 4.15 Addition of Included Sites.
--------------------------
Additional locations of an Originator may be added to
Schedule IV as Included Sites with the consent of the Seller
and the Administrator (which consent shall not be
unreasonably withheld), provided that the following
conditions are satisfied on or before the date of such
addition:
(a) the applicable Originator shall have given
the Seller and the Administrator at least five (5)
Business Days' prior written notice of such proposed
addition and the identity of the proposed location;
(b) such Originator has delivered to the
Seller and the Administrator a revised Schedule IV
reflecting such additional location;
(c) such Originator has delivered to the
Administrator copies of each Lock-Box Agreement with
respect to such additional location, duly executed by
each of the parties thereto, in substantially the form
of Annex B and a revised Schedule I reflecting such
additional Lock-Box Agreements;
(d) the Seller and the Administrator shall
have completed their review, if any, of the historical
receivables data and accounts and such information
shall be satisfactory thereto; and
(e) no event has occurred and is continuing,
or would result from the addition of such location as
an Included Site, that constitutes a Termination Event
or an Unmatured Termination Event.
2.3 The definition of "Included Site" is hereby added to
Exhibit I to the Agreement, as alphabetically appropriate, to be
and to read as follows:
"Included Site" means any location of an Originator
-------------
listed on Schedule IV, as such schedule may from time to
time be revised in accordance with Section 4.15.
2.4 The definition of "Receivable" in Exhibit I to the
Agreement is hereby amended by adding the following phrase,
immediately prior to the period, at the end thereof:
, other than any such indebtedness not arising at or through
an Included Site
2.5 Clause (ii)(A) of paragraph (i) in Exhibit IV to the
Agreement is hereby amended by adding the following proviso,
immediately prior to the comma, at the end thereof:
; provided, however, that the Obligors of Receivables
originated by WISCO II, LLC or WISCO III, LLC may be
instructed to make payments directly to the Servicer (or
any sub-servicer), which payments shall be deposited by the
Servicer (or such sub-servicer) into a Lock-Box Account not
later than two Business Days after receipt thereof.
2.6 Schedule I to the Agreement is hereby amended and
restated to be read as set forth on Schedule I hereto.
2
2.7 A new Schedule IV is hereby added to the Agreement to
be and to read as set forth on Schedule IV hereto.
3. Effect of Amendment. This Amendment shall become effective
-------------------
upon (i) the execution of this Amendment and the first amendments to the
Purchase and Sale Agreement and to the Servicing Agreement, each dated
as of the date hereof (the "Other First Amendments") by all of the
----------------------
parties and (ii) receipt by the Administrator of all agreements,
opinions and other documents reasonably requested thereby. Except as
expressly amended and modified by this Amendment, all provisions of the
Receivables Purchase Agreement shall remain in full force and effect.
After this Amendment becomes effective, all references in each of the
Agreements to "this Agreement", "hereof", "herein", or words of similar
effect referring to such Agreement shall be deemed to be references to
the Receivables Purchase Agreement, as amended by this Amendment. This
Amendment shall not be deemed to expressly or impliedly waive, amend or
supplement any provision of the Agreements other than as set forth
herein.
4. Counterparts. This Amendment may be executed in any number
------------
of counterparts and by different parties on separate counterparts, each
of which shall be deemed to be an original and all of which when take
together shall constitute but one and the same instrument.
5. Governing Law. This Amendment shall be governed by, and
-------------
construed in accordance with, the law of the State of New York without
regard to any otherwise applicable principles of conflicts of law.
6. Section Headings. The various headings of this Amendment
----------------
are included for convenience only and shall not affect the meaning or
interpretation of this Amendment, the Agreement or any provision hereof
or thereof.
7. Consent. Each party hereto hereby consents to the
-------
execution and delivery of the Other First Amendments.
[signature pages on next page]
3
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of
the date first above written.
MAIL-WELL TRADE RECEIVABLES
CORPORATION, as Seller
By:_____________________________________
Name: Robert Meyer
Title: Vice President, Treasurer and Tax
MAIL-WELL I CORPORATION, as Servicer
By:_____________________________________
Name: Robert Meyer
Title: Vice President, Treasurer and Tax
4
BANK OF AMERICA, NATIONAL ASSOCIATION
(f/k/a BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION), as Administrator
By:______________________________________
Name:
Title:
BANK OF AMERICA, NATIONAL ASSOCIATION
(f/k/a BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION), as an Alternate
Purchaser
By:______________________________________
Name:
Title:
5
HARRIS TRUST AND SAVINGS BANK,
as an Alternate Purchaser
By:__________________________________
Name:
Title:
6
THE BANK OF NOVA SCOTIA,
as an Alternate Purchaser
By:_________________________________
Name:
Title:
7
QUINCY CAPITAL CORPORATION,
as Issuer
By:_________________________________
Name:
Title:
8
SCHEDULE IV
INCLUDED SITES
Originator Location
---------- --------