FOURTH AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT
dated as of June 18, 2012
among
MERITOR HEAVY VEHICLE BRAKING SYSTEMS (USA), LLC
and
MERITOR HEAVY VEHICLE SYSTEMS, LLC,
as Originators,
THE OTHER ORIGINATORS FROM TIME TO TIME PARTY HERETO
MERITOR, INC.,
as Servicer,
and
ARVINMERITOR RECEIVABLES CORPORATION,
as Buyer
ARTICLE I
AGREEMENT TO PURCHASE AND SELL
2
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SECTION 1.1
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Agreement To Purchase and Sell
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2
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SECTION 1.2
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Timing of Purchases; Purchases under the Existing Agreement
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3
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SECTION 1.3
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Consideration for Purchases
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3
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SECTION 1.4
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Purchase and Sale Termination Date
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3
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SECTION 1.5
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Intention of the Parties
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4
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ARTICLE II
PURCHASE REPORT; CALCULATION OF PURCHASE PRICE
4
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SECTION 2.1
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Purchase Report
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4
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SECTION 2.2
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Calculation of Purchase Price
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5
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ARTICLE III
PAYMENT OF PURCHASE PRICE
5
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SECTION 3.1
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Initial Purchase Price Payment
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5
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SECTION 3.2
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Subsequent Purchase Price Payments
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5
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SECTION 3.3
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Letters of Credit
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6
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SECTION 3.4
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Settlement as to Specific Receivables and Dilution
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7
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SECTION 3.5
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Reconveyance of Receivables
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8
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ARTICLE IV
CONDITIONS OF PURCHASES
8
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SECTION 4.1
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Conditions Precedent to this Agreement
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8
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SECTION 4.2
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Certification as to Representations and Warranties
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9
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SECTION 4.3
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Additional Originators
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10
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE ORIGINATORS
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SECTION 5.1
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Existence and Power
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10
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SECTION 5.2
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Company and Governmental Authorization, Contravention
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10
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SECTION 5.3
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Binding Effect of Agreement
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11
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SECTION 5.4
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Accuracy of Information
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11
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SECTION 5.5
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Actions, Suits
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11
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SECTION 5.6
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No Material Adverse Effect
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11
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SECTION 5.7
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Credit and Collection Policy
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11
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SECTION 5.8
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Investment Company Act
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11
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SECTION 5.9
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No Sanctions
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11
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SECTION 5.10
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Transaction Information
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11
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SECTION 5.11
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Taxes
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12
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SECTION 5.12
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Compliance with Applicable Laws
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12
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SECTION 5.13
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Reliance on Separate Legal Identity
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12
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SECTION 5.14
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Perfection
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12
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SECTION 5.15
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Creation of Receivables
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12
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SECTION 5.16
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Enforceability of Contracts
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12
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SECTION 5.17
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Location and Offices
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13
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SECTION 5.18
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[Intentionally omitted.]
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13
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SECTION 5.19
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Names
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13
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SECTION 5.20
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Eligible Receivables
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13
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SECTION 5.21
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Bulk Sales, Margin Regulations, No Fraudulent Conveyance, Investment Buyer
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13
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SECTION 5.22
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Licenses, Contingent Liabilities, and Labor Controversies
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13
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SECTION 5.23
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Ordinary Course of Business
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SECTION 5.24
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Purchase Price
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13
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SECTION 5.25
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Reaffirmation of Representations and Warranties by each Originator
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14
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ARTICLE VI
COVENANTS OF THE ORIGINATORS
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SECTION 6.1
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Affirmative Covenants
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14
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SECTION 6.2
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Reporting Requirements
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15
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SECTION 6.3
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Negative Covenants
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16
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SECTION 6.4
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Substantive Consolidation
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17
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ARTICLE VII
ADDITIONAL RIGHTS AND OBLIGATIONS IN RESPECT OF RECEIVABLES
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SECTION 7.1
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Rights of the Buyer
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19
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SECTION 7.2
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Responsibilities of the Originators
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19
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SECTION 7.3
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Further Action Evidencing Purchases
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20
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SECTION 7.4
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Application of Collections
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20
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ARTICLE VIII
PURCHASE AND SALE TERMINATION EVENTS
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SECTION 8.1
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Purchase and Sale Termination Events
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21
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SECTION 8.2
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Remedies
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21
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ARTICLE IX
INDEMNIFICATION
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SECTION 9.1
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Indemnities by the Originators
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ARTICLE X
MISCELLANEOUS
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SECTION 10.1
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Amendments, etc
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23
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SECTION 10.2
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Notices, etc
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24
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SECTION 10.3
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No Waiver; Cumulative Remedies
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24
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SECTION 10.4
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Binding Effect; Assignability
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24
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SECTION 10.5
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Governing Law
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24
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SECTION 10.6
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Costs, Expenses and Taxes
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25
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SECTION 10.7
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SUBMISSION TO JURISDICTION
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25
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SECTION 10.8
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WAIVER OF JURY TRIAL
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25
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SECTION 10.9
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Captions and Cross References; Incorporation by Reference
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26
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SECTION 10.10
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Execution in Counterparts
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26
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SECTION 10.11
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Acknowledgment and Agreement
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26
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SECTION 10.12
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No Proceeding
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SECTION 10.13
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Limited Recourse
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27
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SECTION 10.14
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Amendment and Restatement of Existing Agreement
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27
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SCHEDULES
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Schedule I
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Location of Each Originator
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Schedule II
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Location of Books and Records of Originators
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Schedule IV
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Actions/Suits
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EXHIBITS
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Exhibit A
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Form of Purchase Report
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Exhibit B
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Form of Subordinated Note
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Exhibit C
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Form of Joinder Agreement
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This FOURTH AMENDED AND RESTATED PURCHASE AND SALE AGREEMENT (as amended, restated, supplemented or otherwise modified from time to time, this “
Agreement
”), dated as of June 18, 2012, is entered into by and among MERITOR HEAVY VEHICLE BRAKING SYSTEMS (USA), LLC, a Delaware limited liability company, and MERITOR HEAVY VEHICLE SYSTEMS, LLC, a Delaware limited liability company (together with the other Persons that from time to time become parties hereto as originators, the “
Originators
” and each, an “
Originator
”), MERITOR, INC., an Indiana corporation (“
Meritor
”), as initial Servicer (as defined below), and ARVINMERITOR RECEIVABLES CORPORATION, a Delaware corporation (the “
Buyer
”).
DEFINITIONS
Unless otherwise indicated herein, capitalized terms used and not otherwise defined in this Agreement are defined in
Exhibit I
to the Receivables Purchase Agreement, dated as of the date hereof (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “
Receivables Purchase Agreement
”), among the Buyer, as seller, Meritor, as initial servicer (in such capacity, the “
Servicer
”), the various Purchasers and Purchaser Agents from time to time party thereto, and PNC Bank, National Association, as Administrator.
BACKGROUND:
1.
The Originators generate Receivables in the ordinary course of their businesses. The Originators wish to sell such Receivables to the Buyer, and the Buyer is willing to purchase such Receivables from the Originators, on the terms and subject to the conditions set forth herein.
2.
The Buyer and the Originators are parties to a Third Amended and Restated Purchase and Sale Agreement, dated as of September 8, 2009, as amended prior to the date hereof (the “
Existing Agreement
”). As contemplated by the Existing Agreement, the Buyer previously entering into a financing arrangement evidenced by a Loan and Security Agreement, dated as of September 8, 2009, among the Buyer, as borrower, Ally Commercial Finance LLC (f/k/a GMAC Commercial Finance LLC) as agent and lender, and the lenders and other parties from time to time party thereto (such financing arrangement, the “
Ally Securitization
”). On or about the date hereof, the Buyer has terminated the Ally Securitization and paid all its obligations thereunder in full.
3.
Concurrently herewith, the Buyer is entering into the Receivables Purchase Agreement.
4.
In connection with the termination of the Ally Securitization and the Buyer’s entry into the Receivables Purchase Agreement, the parties hereto desire to amend and restate the Existing Agreement on the terms and subject to the conditions set forth herein.
5.
The Buyer previously issued to each Originator a “Subordinated Note” defined in, and pursuant to the terms of, the Existing Agreement (each, an “
Existing Subordinated Note
”). In connection with this Agreement, each Existing Subordinated Note is being amended, restated and superseded in its entirety by the Subordinated Notes being issued by the Buyer to the Originators hereunder.
NOW, THEREFORE, in consideration of the premises and the mutual agreements herein contained, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:
ARTICLE I
AGREEMENT TO PURCHASE AND SELL
SECTION 1.1
Agreement To Purchase and Sell
. On the terms and subject to the conditions set forth in this Agreement, each Originator, severally and for itself, agrees to sell to the Buyer, and the Buyer agrees to purchase from such Originator, from time to time on or after the Closing Date, but before the Purchase and Sale Termination Date (as defined in
Section 1.4
), all of such Originator’s right, title and interest in and to:
(a)
each Receivable of such Originator that existed and was owing to such Originator at the closing of such Originator’s business on the Cut-off Date (as defined below) if such Receivable has not been sold to Buyer under the Existing Agreement;
(b)
each Receivable generated by such Originator from and including the Cut-off Date to but excluding the Purchase and Sale Termination Date;
(c)
all rights to, but not the obligations of, such Originator under all Related Security with respect to any of the foregoing Receivables;
(d)
all monies due or to become due to such Originator with respect to any of the foregoing;
(e)
all books and records of such Originator to the extent related to any of the foregoing;
(f)
all Collections and other proceeds and products of any of the foregoing (each as defined in the UCC) that are or were received by such Originator on or after the Cut-off Date, including, without limitation, all funds which either are received by such Originator, the Buyer or the Servicer from or on behalf of the Obligors in payment of any amounts owed (including, without limitation, invoice price, finance charges, interest and all other charges) in respect of any of the above Receivables or are applied to such amounts owed by the Obligors (including, without limitation, any insurance payments that such Originator, the Buyer or the Servicer applies in the ordinary course of its business to amounts owed in respect of any of the above Receivables, and net proceeds of sale or other disposition of repossessed goods or other collateral or property of the Obligors in respect of any of the above Receivables or any other parties directly or indirectly liable for payment of such Receivables); and
(g)
all rights, remedies, powers, privileges, title and interest (but not obligations) in and to each lock-box address and all Lock-Box Accounts, into which any Collections or other proceeds with respect to such Receivables may be deposited, and any related investment property acquired with any such Collections or other proceeds (as such term is defined in the applicable UCC).
All purchases hereunder shall be made without recourse, but shall be made pursuant to, and in reliance upon, the representations, warranties and covenants of the Originators set forth in this Agreement. No obligation or liability to any Obligor on any Receivable is intended to be assumed by the Buyer hereunder, and any such assumption is expressly disclaimed. The Buyer’s foregoing commitment to purchase Receivables and the property, proceeds and rights described in
clauses (c)
through
(g)
(collectively, the “
Related Rights
”) is herein called the “
Purchase Facility
.”
As used herein, “
Cut-Off Date
” means (a) with respect to each Originator party hereto on the date hereof, June 15, 2012, and (b) with respect to any Originator that first becomes a party hereto after the date hereof, the calendar day prior to the date on which such Originator becomes a party hereto or such other date as the Buyer and such Originator agree to in writing.
For the avoidance of doubt, the parties acknowledge and agree that the Receivables sold and purchased hereunder do not include Excluded Receivables.
SECTION 1.2
Timing of Purchases; Purchases under the Existing Agreement
.
(a)
Closing Date Purchases
. Each Originator’s entire right, title and interest in each Receivable that existed and was owing to such Originator at the Cut-off Date and all Related Rights with respect thereto automatically shall be deemed to have been sold by such Originator to the Buyer on the Closing Date.
(b)
Subsequent Purchases
. After the Closing Date, until the Purchase and Sale Termination Date, each Receivable and the Related Rights generated by each Originator shall be, and shall be deemed to have been sold by such Originator to the Buyer immediately (and without further action) upon the creation of such Receivable.
(c)
Purchases under the Existing Agreement
. Each of the Buyer and the Originators hereby ratifies and confirms each of the purchases and sales of “Accounts”, “Related Security”, “Lock-Box Accounts” and proceeds thereof (in each case, as defined in the Existing Agreement) made from time to time prior to the effectiveness of this Agreement under the Existing Agreement. From and after the effectiveness of this Agreement, each such prior purchase and sale, and the rights and obligations of the Buyer and the Originators in respect thereof, shall be subject to the terms of this Agreement.
SECTION 1.3
Consideration for Purchases
. On the terms and subject to the conditions set forth in this Agreement, the Buyer agrees to make Purchase Price payments to the Originators in accordance with
Article III
.
SECTION 1.4
Purchase and Sale Termination Date
. The “
Purchase and Sale Termination Date
” shall be the earliest to occur of (a) the date the Purchase Facility is terminated pursuant to
Section 8.2
and (b) the Payment Date immediately following the day on which the Originators shall have given written notice to the Buyer, the Administrator and each Purchaser Agent at or prior to 10:00 a.m. (New York City time) that the Originators desire to terminate this Agreement.
SECTION 1.5
Intention of the Parties
. It is the express intent of each Originator and the Buyer that each conveyance by such Originator to the Buyer pursuant to this Agreement (or the Existing Agreement) of the Receivables and Related Rights, including without limitation, all Receivables, if any, constituting general intangibles as defined in the UCC, and all Related Rights be construed as a valid and perfected sale and absolute assignment (without recourse except as provided herein) of such Receivables and Related Rights by such Originator to the Buyer (rather than the grant of a security interest to secure a debt or other obligation of such Originator) and that the right, title and interest in and to such Receivables and Related Rights conveyed to the Buyer be prior to the rights of and enforceable against all other Persons at any time, including, without limitation, lien creditors, secured lenders, purchasers and any Person claiming through such Originator. However, if, contrary to the mutual intent of the parties, any conveyance of Receivables and Related Rights, including without limitation any Receivables constituting general intangibles, is not construed to be both a valid and perfected sale and absolute assignment of such Receivables and Related Rights, and a conveyance of such Receivables and Related Rights that is prior to the rights of and enforceable against all other Persons at any time, including without limitation lien creditors, secured lenders, purchasers and any Person claiming through such Originator, then, it is the intent of such Originator and the Buyer that (i) this Agreement also shall be deemed to be, and hereby is, a security agreement within the meaning of the UCC; and (ii) such Originator shall be deemed to have granted to the Buyer as of the date of this Agreement, and such Originator hereby grants to the Buyer a security interest in, to and under all of such Originator’s right, title and interest in and to: (A) the Receivables and the Related Rights now existing and hereafter created by such Originator transferred or purported to be transferred hereunder or under the Existing Agreement, (B) all monies due or to become due and all amounts received with respect thereto, (C) all books and records of such Originator to the extent related to any of the foregoing, (D) all rights, remedies, powers, privileges, title and interest (but not obligations) of such Originator in and to each lock-box address and account (including, without limitation, all related Lock-Box Accounts) to which Collections or other proceeds with respect to such Receivables are sent, all amounts on deposit therein, and any related investment property acquired with any such collections or other proceeds (as such term is defined in the applicable UCC) and (E) all proceeds and products of any of the foregoing to secure all of such Originator’s obligations hereunder.
ARTICLE II
PURCHASE REPORT; CALCULATION OF PURCHASE PRICE
SECTION 2.1
Purchase Report
. On the Closing Date and on each date when a Monthly Information Package is due to be delivered under the Receivables Purchase Agreement (each such date, a “
Monthly Purchase Report Date
”), the Servicer shall deliver to the Buyer and each Originator a report in substantially the form of
Exhibit A
(each such report being herein called a “
Purchase Report
”) setting forth, among other things:
(a)
Receivables purchased by the Buyer from each Originator on the Closing Date (in the case of the Purchase Report to be delivered on the Closing Date);
(b)
Receivables purchased by the Buyer from each Originator during the Fiscal Month immediately preceding such Monthly Purchase Report Date (in the case of each subsequent Purchase Report); and
(c)
the calculations of reductions of the Purchase Price for any Receivables as provided in
Section 3.4(a)
and
(b)
.
SECTION 2.2
Calculation of Purchase Price
. The “
Purchase Price
” to be paid to each Originator for the Receivables that are purchased hereunder from such Originator shall be determined in accordance with the following formula:
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PP
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=
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OB x FMVD
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where:
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PP
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=
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Purchase Price for each Receivable as calculated on the relevant Payment Date.
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OB
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=
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The Outstanding Balance of such Receivable on the relevant Payment Date.
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FMVD
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=
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98.25% representing a 175 basis point fair market value discount for uncertainty of payment and the time value of money.
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“
Payment Date
” means (i) the Closing Date and (ii) each Business Day thereafter that the Originators are open for business.
ARTICLE III
PAYMENT OF PURCHASE PRICE
SECTION 3.1
Initial Purchase Price Payment
. On the terms and subject to the conditions set forth in this Agreement, the Buyer agrees to pay to each Originator the Purchase Price for the purchase to be made from such Originator on the Closing Date partially in cash (in an amount to be agreed between the Buyer and such Originator and set forth in the initial Purchase Report) and partially by issuing a promissory note in the form of
Exhibit B
to such Originator (each such promissory note, as it may be amended, supplemented, endorsed or otherwise modified from time to time, together with all promissory notes issued from time to time in substitution therefor or renewal thereof in accordance with the Transaction Documents, each being herein called a “
Subordinated Note
”) with an initial principal balance equal to the remaining Purchase Price payable to such Originator plus the outstanding principal balance, if any, of such Originator’s Existing Subordinated Note. For the avoidance of doubt, the foregoing Purchase Price shall be payable by the Buyer to the Originators only to the extent that it has not previously been paid by the Buyer pursuant to the Existing Agreement.
SECTION 3.2
Subsequent Purchase Price Payments
. On each Payment Date subsequent to the Closing Date, on the terms and subject to the conditions set forth in this Agreement, the Buyer shall pay to each Originator the Purchase Price for the Receivables generated by such Originator on such Payment Date:
(a)
First
, in cash to the extent the Buyer has cash available therefor (and such payment is not prohibited under the Receivables Purchase Agreement) and/or, if requested by such Originator, by causing the LC Bank to issue one or more Letters of Credit in accordance with
Section 3.3
and on the terms and subject to the conditions of this
Article III
and the Receivables Purchase Agreement;
(b)
Second
, to the extent any portion of the Purchase Price remains unpaid (for the avoidance of doubt, no portion of the Purchase Price as to which a Letter of Credit has been issued in accordance with
Section 3.3
and on the terms and subject to the conditions of this
Article III
and the Receivables Purchase Agreement shall be deemed to remain unpaid), the principal amount outstanding under the applicable Subordinated Note shall be automatically increased by an amount equal to such remaining Purchase Price.
The Servicer shall make all appropriate record keeping entries with respect to each of the Subordinated Notes to reflect the foregoing payments and reductions made pursuant to
Section 3.3
, and the Servicer’s books and records shall constitute rebuttable presumptive evidence of the principal amount of, and accrued interest on, each of the Subordinated Notes at any time. Each Originator hereby irrevocably authorizes the Servicer to mark the Subordinated Notes “CANCELED” and to return such Subordinated Notes to the Buyer upon the final payment thereof after the occurrence of the Purchase and Sale Termination Date.
SECTION 3.3
Letters of Credit
.
(a)
An Originator may request that the Purchase Price for Receivables sold on a Payment Date be paid by the Buyer procuring the issuance of a Letter of Credit by the LC Bank. Upon the request of an Originator, and on the terms and conditions for issuing Letters of Credit under the Receivables Purchase Agreement (including any limitations therein on the amount of any such issuance), the Buyer agrees to cause the LC Bank to issue, on the Payment Dates specified by such Originator, Letters of Credit in favor of the beneficiaries specified by such Originator. The aggregate stated amount of the Letters of Credit being issued on any Payment Date on behalf of any Originator shall constitute a credit against the aggregate Purchase Price payable by the Buyer to such Originator on such Payment Date pursuant to
Section 3.2
. To the extent that the aggregate stated amount of the Letters of Credit being issued on any Payment Date exceeds the aggregate Purchase Price payable by the Buyer to an Originator on such Payment Date, such excess shall be deemed to be a (i) reduction in the outstanding principal balance of (and, to the extent necessary, the accrued but unpaid interest on) the Subordinated Note payable to such Originator and/or (ii) a reduction in the Purchase Price payable on the Payment Dates immediately following the date any such Letter of Credit is issued. In the event that any such Letter of Credit issued pursuant to this
Section 3.3
(i) expires or is cancelled or otherwise terminated with all or any portion of its stated amount undrawn, (ii) has its stated amount decreased (for a reason other than a drawing having been made thereunder) or (iii) the Buyer’s Reimbursement Obligation in respect thereof is reduced for any reason other than by virtue of a payment made in respect of a drawing thereunder, then an amount equal to such undrawn amount or such reduction, as the case may be, shall either be paid in cash to such Originator on the next Payment Date or, if the Buyer does not then have cash available therefor, shall be deemed to be added to the outstanding principal balance of the Subordinated Note issued to such Originator. Under no circumstances shall the Originator (or any Affiliate thereof (other than the Buyer)) have any reimbursement or recourse obligations in respect of any Letter of Credit.
(b)
In the event that any Originator requests that any purchases be paid for by the issuance of a Letter of Credit hereunder, such Originator shall on a timely basis provide the Buyer with such information as is necessary for the Buyer to obtain such Letter of Credit from the LC Bank, and shall notify the Buyer, the Servicer, and the Administrator of the allocations described in clause (a) above. Such allocations shall be binding on the Buyer and the Originator, absent manifest error.
(c)
Each Originator agrees to be bound by the terms of each Letter of Credit Application referenced in the Receivables Purchase Agreement and that the Letter of Credit shall be subject either to the Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication No. 600, and any amendments or revisions thereof adhered to by the LC Bank or the International Standby Practices (ISP98-International Chamber of Commerce Publication Number 590), and any amendments or revisions thereof adhered to by the LC Bank, as determined by the LC Bank, in each case subject to the terms and conditions set forth in the Receivables Purchase Agreement.
SECTION 3.4
Settlement as to Specific Receivables and Dilution
.
(a)
If, (i) on the day of purchase of any Receivable from an Originator hereunder, any of the representations or warranties set forth in
Sections 5.14
and
5.20
are not true with respect to such Receivable or (ii) as a result of any action or inaction (other than solely as a result of the failure to collect such Receivable due to a discharge in bankruptcy or similar insolvency proceeding or other credit related reasons with respect to the relevant Obligor) of such Originator, on any subsequent day, any of such representations or warranties set forth in
Sections 5.14
or
5.20
is not true with respect to such Receivable, then the Purchase Price for such Receivable shall be reduced by an amount equal to the Outstanding Balance of such Receivable and shall be accounted to such Originator as provided in
clause (c)
below;
provided
, that if the Buyer thereafter receives payment on account of the Outstanding Balance of such Receivable, the Buyer promptly shall deliver such funds to such Originator.
(b)
If, on any day, the Outstanding Balance of any Receivable purchased hereunder is reduced or adjusted as a result of any defective, rejected or returned goods or services, or any revision, cancellation, allowance, rebate, discount or other adjustment made by any Originator, the Buyer or the Servicer (of any Affiliate thereof) or any setoff or dispute between any Originator or the Servicer and an Obligor as indicated on the books of the Buyer, then the Purchase Price with respect to such Receivable shall be reduced by the amount of such net reduction and shall be accounted to such Originator as provided in
clause (c)
below.
(c)
Any reduction in the Purchase Price of any Receivable pursuant to
clause (a)
or
(b)
above shall be applied as a credit for the account of the Buyer against the Purchase Price of Receivables subsequently purchased by the Buyer from such Originator hereunder;
provided
,
however
if there have been no purchases of Receivables from such Originator (or insufficiently large purchases of Receivables) to create a Purchase Price sufficient to so apply such credit against, the amount of such credit:
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(i)
|
to the extent of any outstanding principal balance under the Subordinated Note payable to such Originator, shall be deemed to be a payment under, and shall be deducted from the principal amount outstanding under, the Subordinated Note payable to such Originator; and
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(ii)
|
after making any deduction pursuant to
clause (i)
above, shall be paid in cash to the Buyer by such Originator in the manner and for application as described in the following
proviso
;
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provided
,
further
, that at any time (y) when a Termination Event or an Unmatured Termination Event exists under the Receivables Purchase Agreement or (z) on or after the Purchase and Sale Termination Date, the amount of any such credit shall be paid by such Originator to the Buyer by deposit in immediately available funds into a Lock-Box Account for application by the Servicer to the same extent as if Collections of the applicable Receivable in such amount had actually been received on such date.
SECTION 3.5
Reconveyance of Receivables
. In the event that the Purchase Price of a Receivable has been reduced to zero, and the credit for such reduction has been applied pursuant to
Section 3.4
, the Buyer shall reconvey such Receivable to such Originator, without representation or warranty, but free and clear of all liens, security interests, charges, and encumbrances created by the Buyer.
ARTICLE IV
CONDITIONS OF PURCHASES
SECTION 4.1
Conditions Precedent to this Agreement
. The effectiveness of this Agreement is subject to the condition precedent that the Buyer and the Administrator (as the Buyer’s assignee) shall have received, on or before the Closing Date, the following, each (unless otherwise indicated) dated the Closing Date, and each in form and substance satisfactory to the Buyer and the Administrator (as the Buyer’s assignee):
(a)
A copy of the resolutions of the board of directors or managers of each Originator approving this Agreement and the other Transaction Documents to be executed and delivered by it and the transactions contemplated hereby and thereby, certified by the Secretary or Assistant Secretary of such Originator;
(b)
Good standing certificates for each Originator issued as of a recent date acceptable to the Buyer and the Administrator (as the Buyer’s assignee) by the Secretary of State (or similar official) of the jurisdiction of such Originator’s organization and each jurisdiction where such Originator is qualified to transact business;
(c)
A certificate of the Secretary or Assistant Secretary of each Originator certifying the names and true signatures of the officers authorized on such Person’s behalf to sign this Agreement and the other Transaction Documents to be executed and delivered by it (on which certificate the Servicer, the Buyer and the Administrator (as the Buyer’s assignee) may conclusively rely until such time as the Servicer, the Buyer and the Administrator (as the Buyer’s assignee) shall receive from such Person a revised certificate meeting the requirements of this
clause (c)
);
(d)
The certificate or articles of incorporation or other organizational document of each Originator (including all amendments and modifications thereto) duly certified by the Secretary of State of the jurisdiction of such Originator’s organization as of a recent date acceptable to the Administrator, together with a copy of the by-laws or limited liability company agreement of such Originator (including all amendments and modifications thereto), as applicable, each duly certified by the Secretary or an Assistant Secretary of such Originator;
(e)
Proper financing statements (Form UCC-1) that have been duly authorized and name each Originator as the debtor/seller and the Buyer as the buyer/assignor (and the Administrator, for the benefit of the Purchasers, as secured party/assignee) of the Receivables generated by such Originator as may be necessary or, in the Buyer’s or the Administrator’s opinion, desirable under the UCC of all appropriate jurisdictions to perfect the Buyer’s ownership interest in such Receivables and such other rights, accounts, instruments and moneys (including, without limitation, Related Security) in which an ownership or security interest has been assigned to it hereunder;
(f)
A written search report from a Person satisfactory to the Buyer and the Administrator (as the Buyer’s assignee) listing all effective financing statements that name the Originators as debtors or sellers and that are filed in all jurisdictions in which filings may be made against such Person pursuant to the applicable UCC, together with copies of such financing statements (none of which, except for those described in the foregoing
clause (e)
(and/or released or terminated as the case may be prior to the date hereof), shall cover any Receivable or any Related Rights which are to be sold to the Buyer hereunder), and tax and judgment lien search reports (including, without limitation, liens of the Pension Benefit Guaranty Corporation) from a Person satisfactory to the Buyer and the Administrator (as the Buyer’s assignee) showing no evidence of such liens filed against any Originator;
(g)
Favorable opinions of counsel to the Originators, in form and substance satisfactory to the Buyer and the Administrator;
(h)
Copies of a Subordinated Note in favor of each Originator, duly executed by the Buyer; and
(i)
Evidence (i) of the execution and delivery by each of the parties thereto of each of the other Transaction Documents to be executed and delivered by it in connection herewith and (ii) that each of the conditions precedent to the execution, delivery and effectiveness of such other Transaction Documents has been satisfied to the Buyer’s and the Administrator’s (as the Buyer’s assignee) satisfaction.
SECTION 4.2
Certification as to Representations and Warranties
. Each Originator, by accepting the Purchase Price related to each purchase of Receivables generated by such Originator, shall be deemed to have certified that the representations and warranties contained in
Article V
, as from time to time amended in accordance with the terms hereof, are true and correct on and as of such day, with the same effect as though made on and as of such day (except for representations and warranties which apply to an earlier date, in which case such representations and warranties shall be true and correct as of such earlier date).
SECTION 4.3
Additional Originators
. Additional Persons may be added as Originators hereunder, with the prior written consent of the Buyer and the Administrator (which consents may be granted or withheld in their sole discretion);
provided
that the following conditions are satisfied on or before the date of such addition:
(a)
the Servicer shall have given the Buyer and the Administrator at least thirty days’ prior written notice of such proposed addition and the identity of the proposed additional Originator and shall have provided such other information with respect to such proposed additional Originator as the Administrator may reasonably request;
(b)
such proposed additional Originator has executed and delivered to the Buyer and the Administrator an agreement substantially in the form attached hereto as
Exhibit C
(a “
Joinder Agreement
”);
(c)
such proposed additional Originator has delivered to the Buyer and the Administrator (as the Buyer’s assignee) each of the documents with respect to such Originator described in
Sections 4.1
and
4.2
, in each case in form and substance satisfactory to the Buyer, the Administrator (as the Buyer’s assignee); and
(d)
no Purchase and Sale Termination Date or Unmatured Purchase and Sale Termination Date shall have occurred and be continuing.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE ORIGINATORS
In order to induce the Buyer to enter into this Agreement and to make purchases hereunder, each Originator hereby represents and warrants with respect to itself that each representation and warranty concerning it or the Receivables sold by it hereunder, that is contained in the Receivables Purchase Agreement is true and correct, and hereby makes the representations and warranties set forth in this
Article V
:
SECTION 5.1
Existence and Power
. Such Originator is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and has all power and authority and all governmental licenses, authorizations, consents and approvals required to carry on its business in each jurisdiction in which its business is conducted, except where failure to have such licenses, authorizations, consents or approvals would not be reasonably expected to have a Material Adverse Effect.
SECTION 5.2
Company and Governmental Authorization, Contravention
. The execution, delivery and performance by such Originator of this Agreement are within such Originator’s company powers, have been duly authorized by all necessary company action, require no action by or in respect of, or filing with (other than the filing of the UCC financing statements and continuation statements contemplated hereunder and disclosures and filings under applicable securities laws), any governmental body, agency or official, and, do not contravene, or constitute a default under, any provision of applicable law or regulation or of the organizational documents of such Originator or of any agreement, judgment, injunction, order, decree or other instrument binding upon such Originator or result in the creation or imposition of any lien (other than liens in favor of the Buyer and Administrator under the Transaction Documents) on assets of such Originator or any of its Subsidiaries.
SECTION 5.3
Binding Effect of Agreement
. This Agreement and each of the other Transaction Documents to which it is a party constitutes the legal, valid and binding obligation of such Originator enforceable against such Originator in accordance with its terms, except as such 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 enforceability is considered in a proceeding in equity or at law.
SECTION 5.4
Accuracy of Information
. All information heretofore furnished by such Originator to the Buyer, the Administrator, any Purchaser Agent or any Purchaser pursuant to or in connection with this Agreement or any other Transaction Document or any transaction contemplated hereby or thereby is, and all such information hereafter furnished by such Originator to the Buyer, the Administrator, any Purchaser Agent or any Purchaser in writing pursuant to this Agreement or any Transaction Document will be, true and accurate in all material respects on the date such information is stated or certified.
SECTION 5.5
Actions, Suits
. Except as described on
Schedule IV
hereto, there are no actions, suits or proceedings pending or, to the best of such Originator’s knowledge, threatened against or affecting such Originator or any of its Affiliates or their respective properties, in or before any court, arbitrator or other body, which could reasonably be expected to have a Material Adverse Effect.
SECTION 5.6
No Material Adverse Effect
.
Since April 30, 2012 there has been no Material Adverse Effect on such Originator.
SECTION 5.7
Credit and Collection Policy
. Such Originator has complied in all material respects with its Credit and Collection Policy with regard to each Receivable originated by such Originator.
SECTION 5.8
Investment Company Act
. Such Originator is not an “investment company,” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
SECTION 5.9
No Sanctions
. Such Originator is not a Sanctioned Person. To such Originator’s knowledge, no Obligor was a Sanctioned Person at the time of origination of any Receivable owing by such Obligor. Such Originator and its Affiliates: (i) have less than 15% of their assets in Sanctioned Countries; and (ii) derive less than 15% of their operating income from investments in, or transactions with Sanctioned Persons or Sanctioned Countries. Neither such Originator nor any of its Subsidiaries engages in activities related to Sanctioned Countries except for such activities as are (A) specifically or generally licensed by OFAC, or (B) otherwise in compliance with OFAC’s sanctions regulations.
SECTION 5.10
Transaction Information
. None of such Originator, any Affiliate of such Originator or any third party with which such originator or any Affiliate thereof has contracted, has delivered, in writing or orally, to any Rating Agency providing or proposing to provide a rating to, or monitoring a rating of, any Notes, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and has not participated in any oral communications with respect to Transaction information with any Rating Agency without the participation of such Purchaser Agent.
SECTION 5.11
Taxes
. Such Originator has filed or caused to be filed all U.S. federal income tax returns and all other material returns, statements, forms and reports for taxes, domestic or foreign, required to be filed by it and has paid all taxes payable by it which have become due or any assessments made against it or any of its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority, except any taxes, fees or other charges that are being contested in good faith by appropriate proceedings and for which the such Originator has set aside on its books adequate reserves.
SECTION 5.12
Compliance with Applicable Laws
. Such Originator is in compliance with the requirements of all applicable laws, rules, regulations and orders of all governmental authorities except to the extent that the failure to comply would not be reasonably expected to have a Material Adverse Effect. In addition, no Receivable sold hereunder contravenes any laws, rules or regulations applicable thereto or to such Originator.
SECTION 5.13
Reliance on Separate Legal Identity
. Such Originator acknowledges that each of the Purchasers, the Purchaser Agents and the Administrator are entering into the Transaction Documents to which they are parties in reliance upon the Buyer’s identity as a legal entity separate from such Originator.
SECTION 5.14
Perfection
. Immediately preceding its sale of each Receivable hereunder, such Originator was the owner of such Receivable sold or purported to be sold, as the case may be, free and clear of any Adverse Claims (after giving effect to the Intercreditor Agreement), and each such sale hereunder constitutes a valid sale, transfer and assignment of all of such Originator’s right, title and interest in, to and under the Receivables sold by it, free and clear of any Adverse Claims. On or before the date hereof and before the generation by such Originator of any new Receivable to be sold or otherwise conveyed hereunder, all financing statements and other documents, if any, required to be recorded or filed in order to perfect and protect the Buyer’s ownership interest in such Receivable against all creditors of and purchasers from such Originator will have been duly filed in each filing office necessary for such purpose, and all filing fees and taxes, if any, payable in connection with such filings shall have been paid in full.
SECTION 5.15
Creation of Receivables
. Such Originator has exercised at least the same degree of care and diligence in the creation of the Receivables sold or otherwise transferred hereunder as it has exercised in connection with the creation of receivables originated by it and not so transferred hereunder.
SECTION 5.16
Enforceability of Contracts
. Each Contract related to any Receivable sold by such Originator hereunder is effective to create, and has created, a legal, valid and binding obligation of the related Obligor to pay the outstanding balance of such Receivable, enforceable against the Obligor in accordance with its terms, without being subject to any defense, deduction, offset or counterclaim and such Originator has fully performed its obligations under such Contract.
SECTION 5.17
Location and Offices
. As of the date hereof, such Originator’s location (as such term is defined in the applicable UCC) is as set forth on
Schedule I
hereto, and such location has not been changed for at least four months before the date hereof. The offices where such Originator keeps all records concerning the Receivables are located at the addresses set forth on
Schedule II
hereto or such other locations of which the Buyer and the Administrator (as the Buyer’s assignee) has been given written notice in accordance with the terms hereof.
SECTION 5.18
[Intentionally omitted.]
SECTION 5.19
Names
. Except as described in
Schedule III
, such Originator has not used any corporate or company names, tradenames or assumed names other than its name set forth on the signature pages of this Agreement.
SECTION 5.20
Eligible Receivables
. Each Receivable listed as an Eligible Receivable or included as an “Eligible Receivable” in the calculation of the Net Receivables Pool Balance in any Information Package delivered to the Administrator is an Eligible Receivable as of the effective date of the information reported in such Information Package.
SECTION 5.21
Bulk Sales, Margin Regulations, No Fraudulent Conveyance, Investment Buyer
. No transaction contemplated hereby requires compliance with or will become subject to avoidance under any bulk sales act or similar law. No use of funds obtained by such Originator hereunder will conflict with or contravene Regulation T, U or X of the Federal Reserve Board. No purchase hereunder constitutes a fraudulent transfer or conveyance under any United States federal or applicable state bankruptcy or insolvency laws or is otherwise void or voidable under such or similar laws or principles or for any other reason.
SECTION 5.22
Licenses, Contingent Liabilities, and Labor Controversies
.
(a)
Such Originator has not failed to obtain any licenses, permits, franchises or other governmental authorizations necessary to the ownership of its properties or to the conduct of its business to the extent material to the operation of such Originator’s business.
(b)
There are no labor controversies pending against such Originator that have had (or could be reasonably expected to have) a Material Adverse Effect.
SECTION 5.23
Ordinary Course of Business
. If notwithstanding the stated intentions of the parties, the transactions contemplated hereby are characterized as loans secured by the Receivables and Related Rights, then each remittance of Collections to the Buyer under this Agreement will have been (i) in payment of a debt incurred by such Originator in the ordinary course of business or financial affairs of such Originator and the Buyer and (ii) made in the ordinary course of business or financial affairs of such Originator and the Buyer.
SECTION 5.24
Purchase Price
. Each sale by such Originator to Buyer of an interest in Receivables has been made for
“reasonably equivalent value”
(as such term is used in Section 548 of the Bankruptcy Code) and not for or on account of
“antecedent debt”
(as such term is used in Section 547 of the Bankruptcy Code) owed by such Originator to Buyer.
SECTION 5.25
Reaffirmation of Representations and Warranties by each Originator
. On each day that a new Receivable is created, and when sold to the Buyer hereunder, such Originator shall be deemed to have certified that all representations and warranties set forth in this
Article V
are true and correct on and as of such day (except for representations and warranties which apply as to an earlier date (in which case such representations and warranties shall be true and correct as of such earlier date)).
ARTICLE VI
COVENANTS OF THE ORIGINATORS
SECTION 6.1
Affirmative Covenants
. From the date hereof until the first day following the Purchase and Sale Termination Date, each Originator will, unless the Administrator and the Buyer shall otherwise consent in writing:
(a)
General Information
. Such Originator shall furnish to the Buyer and the Administrator such information as such Person may from time to time reasonably request.
(b)
Furnishing of Information and Inspection of Records
.
Such Originator will furnish to the Buyer and the Administrator from time to time such information with respect to the Receivables as such Person may reasonably request. Such Originator will at any time and from time to time during regular business hours with reasonable prior written notice (i) permit the Buyer and the Administrator, or their respective agents or representatives, (A) to examine and make copies of and abstracts from all books and records relating to the Receivables or other Pool Assets and (B) to visit the offices and properties of such Originator for the purpose of examining such books and records, and to discuss matters relating to the Receivables, other Related Rights or such Originator’s performance hereunder or under the other Transaction Documents to which it is a party with any of the officers, directors, employees or independent public accountants of such Originator (
provided
that representatives of such Originator are present during such discussions) having knowledge of such matters and (ii) without limiting the provisions of
clause (i)
above, from time to time during regular business hours, upon reasonable prior written notice from the Buyer or the Administrator, permit certified public accountants or other auditors acceptable to the Administrator to conduct, a review of its books and records with respect to the Receivables.
(c)
Keeping of Records and Books
. Such Originator will have and maintain (i) administrative and operating procedures (including an ability to recreate records if originals are destroyed), (ii) adequate facilities, personnel and equipment and (iii) all records and other information reasonably necessary for collection of the Receivables originated by such Originator (including records adequate to permit the daily identification of each new such Receivable and all Collections of, and adjustments to, each existing such Receivable). Such Originator will give the Buyer and the Administrator at least 30 days’ prior written notice of any change in such administrative and operating procedures that causes them to be materially different from the procedures described to the Buyer and the Administrator on or before the date hereof as such Originator’s then existing or planned administrative and operating procedures for collecting Receivables.
(d)
Performance and Compliance with Receivables and Contracts
.
Such Originator will at its expense timely and fully perform and comply with all material provisions, covenants and other promises required to be observed by it under all Contracts or other documents or agreements related to the Receivables.
(e)
Credit and Collection Policy
.
Such Originator will comply in all material respects with its Credit and Collection Policy in regard to each Receivable originated by it and any related Contract or other related document or agreement.
(f)
Receivable Purchase Agreement
.
Such Originator will perform and comply with each covenant and other undertaking in the Receivables Purchase Agreement that the Buyer undertakes to cause such Originator to perform, subject to any grace periods for such performance provided for in the Receivables Purchase Agreement.
(g)
Preservation of Existence
. Such Originator shall preserve and maintain its existence as a corporation, partnership or limited liability company, as applicable, and all rights, franchises and privileges in the jurisdiction of its organization, and qualify and remain qualified in good standing as a foreign corporation, partnership or limited liability company, as applicable, in each jurisdiction where the failure to preserve and maintain such existence, rights, franchises, privileges and qualification would be reasonably expected to have a Material Adverse Effect.
(h)
Location of Records
. Such Originator will keep its location (as such term is defined in the applicable UCC), and the offices where it keeps its records concerning or related to Receivables, at the address(es) referred to in
Schedule I
or
Schedule II
, respectively, or, upon 30 days’ prior written notice to the Buyer and the Administrator (as the Buyer’s assignee), at such other locations in jurisdictions where all action required by
Section 7.3
shall have been taken and completed.
(i)
Post Office Boxes
. On or prior to the date hereof, if requested by the Servicer such Originator will deliver to the Servicer (on behalf of the Buyer) a certificate from an authorized officer of such Originator to the effect that (i) the name of the renter of all post office boxes into which Collections may from time to time be mailed are in the name of the Buyer (unless such post office boxes are in the name of the relevant Lock-Box Banks) and (ii) all relevant postmasters have been notified that each of the Servicer and the Administrator are authorized to collect mail delivered to such post office boxes (unless such post office boxes are in the name of the relevant Lock-Box Banks).
(j)
Preservation of Security Interest
. Such Originator will take (and cause the Servicer to take) any and all action as the Administrator may require to preserve and maintain the perfection and priority of the security interest of the Administrator (on behalf of the Purchasers and as assignee of the Buyer) in the Receivables and Related Rights.
SECTION 6.2
Reporting Requirements
. From the date hereof until the first day following the Purchase and Sale Termination Date, each Originator will, unless the Buyer and the Administrator shall otherwise consent in writing, furnish to the Buyer and the Administrator:
(a)
Purchase and Sale Termination Events
. As soon as possible, and in any event within two (2) Business Days after such Originator becomes aware of the occurrence of each Purchase and Sale Termination Event or each event which with notice or the passage of time or both would become a Purchase and Sale Termination Event (an “
Unmatured Purchase and Sale Termination Event
”), a written statement of the chief financial officer, chief executive officer or president of such Originator describing such Purchase and Sale Termination Event or Unmatured Purchase and Sale Termination Event and the action that such Originator proposes to take with respect thereto, in each case in reasonable detail;
(b)
Proceedings
. As soon as possible and in any event within five (5) BusinessDays after such Originator becomes aware thereof, written notice of (i) litigation, investigation or proceeding of the type described in
Section 5.5
not previously disclosed to the Buyer or the Administrator which could be expected to have a Material Adverse Effect, and (ii) all material adverse developments that have occurred with respect to any previously disclosed litigation, proceedings and investigations; and
(c)
Other
. Promptly, from time to time, such other information, documents, records or reports respecting the Receivables or the conditions or operations, financial or otherwise, of such Originator as the Buyer and the Administrator may from time to time reasonably request in order to protect the interests of the Buyer, the Purchasers, the Purchaser Agents or the Administrator under or as contemplated by the Transaction Documents.
SECTION 6.3
Negative Covenants
. From the date hereof until the first date following the Purchase and Sale Termination Date when no Aggregate Capital or Discount with respect to the Purchased Interest remains outstanding and all obligations of such Originator to the Buyer and its assigns have been satisfied in full, each Originator agrees that, unless the Buyer and the Administrator shall otherwise consent in writing, it shall not:
(a)
Sales, Liens, Etc
. Except as otherwise provided herein or in any other Transaction Document, 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 Receivable sold or otherwise conveyed or purported to be sold or otherwise conveyed hereunder or related Contract or Related Security, or any interest therein, or any Collections thereon, or assign any right to receive income in respect thereof, except to the extent such Receivable has been reconveyed to the Originator under Section 3.5.
(b)
Extension or Amendment of Receivables
. Except as otherwise permitted in
Section 4.2(a)
of the Receivables Purchase Agreement and the applicable Credit and Collection Policy, make any modification with respect to the terms of any Receivable in any material respect generated by it that is sold or otherwise conveyed hereunder, or amend, modify or waive, in any material respect, the provisions of any Contract related thereto.
(c)
Change in Business or Credit and Collection Policy
. (i) Make any change in the character of its business, which change could impair the collectibility of any Pool Receivable or (ii) make any change in its Credit and Collection Policy that would reasonably be expected to materially adversely affect the collectibility of the Receivables, the enforceability of any related Contract or its ability to perform its obligations under the related Contract or the Transaction Documents, in the case of either (i) or (ii) above, without the prior written consent of the Administrator. No Originator shall make any written change in any Credit and Collection Policy without giving prior written notice thereof to the Administrator.
(d)
Receivables Not to be Evidenced by Promissory Notes or Chattel Paper
. Except as otherwise provided in the Receivables Purchase Agreement in regard to servicing, take any action to cause or permit any Receivable generated by it that is sold by it hereunder to become evidenced by any “instrument” or “chattel paper” (as defined in the applicable UCC).
(e)
Mergers, Acquisitions, Sales, etc
. (i) Be a party to any merger, consolidation or other restructuring, except a merger, consolidation or other restructuring where the Buyer and the Administrator have each (A) received 30 days’ prior notice thereof, (B) consented in writing thereto if the resulting entity following such merger, consolidation or other restructuring is any Person other than an Originator, (C) received executed copies of all documents, certificates and opinions (including, without limitation, opinions relating to bankruptcy and UCC matters) as the Buyer or the Administrator shall request and (D) been satisfied that all other action to perfect and protect the interests of the Buyer and the Administrator, on behalf of the Purchasers, in and to the Receivables to be sold by it hereunder and other Related Rights, as requested by the Buyer or the Administrator shall have been taken by, and at the expense of such Originator (including the filing of any UCC financing statements, the receipt of certificates and other requested documents from public officials and all such other actions required pursuant to
Section 7.3
) or (ii) directly or indirectly sell, transfer, assign, convey or lease (A) whether in one or a series of transactions, all or substantially all of its assets or (B) any Receivables or any interest therein (other than pursuant to this Agreement).
(f)
Lock-Box Banks
. Make any changes in its instructions to Obligors regarding Collections on Receivables sold or otherwise conveyed by it hereunder or add or terminate any bank as a Lock-Box Bank unless the requirements of
Section 1(f)
of
Exhibit IV
to the Receivables Purchase Agreement have been met.
(g)
Accounting for Purchases
. Account for or treat (whether in financial statements or otherwise) the transactions contemplated hereby in any manner other than as sales of the Receivables and Related Rights by such Originator to the Buyer.
(h)
Transaction Documents
. Enter into, execute, deliver or otherwise become bound after the Closing Date by any agreement, instrument, document or other arrangement that restricts the right of such Originator 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.
SECTION 6.4
Substantive Consolidation
. Each Originator hereby acknowledges that this Agreement and the other Transaction Documents are being entered into in reliance upon the Buyer’s identity as a legal entity separate from such Originator and its Affiliates. Therefore, from and after the date hereof, each Originator shall take all reasonable steps necessary to make it apparent to third Persons that the Buyer is an entity with assets and liabilities distinct from those of such Originator and any other Person, and is not a division of such Originator, its Affiliates or any other Person. Without limiting the generality of the foregoing and in addition to and consistent with the other covenants set forth herein, such Originator shall take such actions as shall be required in order that:
(a)
such Originator shall not be involved in the day to day management of the Buyer;
(b)
such Originator shall maintain separate corporate records and books of account from the Buyer and otherwise will observe corporate formalities and, to the extent that it and the Buyer have offices in the same location, there shall be a fair and appropriate allocation of overhead costs between them, and each shall bear its fair share of such expenses);
(c)
the financial statements and books and records of such Originator shall be prepared to reflect and shall reflect the separate existence of the Buyer;
provided
, that the Buyer’s assets and liabilities may be included in a consolidated financial statement issued by an affiliate of the Buyer;
provided
,
however
, that any such consolidated financial statement or the notes thereto shall make clear that the Buyer’s assets are not available to satisfy the obligations of such affiliate;
(d)
except as permitted by the Receivables Purchase Agreement, (i) such Originator shall maintain its assets (including, without limitation, deposit accounts) separately from the assets (including, without limitation, deposit accounts) of the Buyer and (ii) the Buyer’s assets, and records relating thereto, have not been, are not, and shall not be, commingled with those of the Buyer;
(e)
all of the Buyer’s business correspondence and other communications that are not conducted on its behalf by the Servicer or any Originator as Sub-Servicer shall be conducted in the Buyer’s own name and on its own stationery;
(f)
such Originator shall not act as an agent for the Buyer;
(g)
such Originator shall not conduct any of the business of the Buyer in its own name (except in the capacity of Sub-Servicer);
(h)
such Originator shall not pay any liabilities of the Buyer out of its own funds or assets;
(i)
such Originator shall maintain an arm’s-length relationship with the Buyer;
(j)
such Originator shall not assume or guarantee or become obligated for the debts of the Buyer or hold out its credit as being available to satisfy the obligations of the Buyer;
(k)
such Originator shall not acquire obligations of the Buyer;
(l)
such Originator shall allocate fairly and reasonably overhead or other expenses that are properly shared with the Buyer, including, without limitation, shared office space;
(m)
such Originator shall identify and hold itself out as a separate and distinct entity from the Buyer;
(n)
such Originator shall correct any known misunderstanding respecting its separate identity from the Buyer;
(o)
such Originator shall not enter into, or be a party to, any transaction with the Buyer, except in the ordinary course of its business and on terms which are intrinsically fair and not less favorable to it than would be obtained in a comparable arm’s-length transaction with an unrelated third party;
(p)
such Originator shall not pay the salaries of the Buyer’s employees, if any; and
(q)
to the extent not already covered in paragraphs (a) through (p) above, such Originator shall comply and/or act in accordance with all of the other separateness covenants set forth in
Section 3
of
Exhibit IV
to the Receivables Purchase Agreement.
ARTICLE VII
ADDITIONAL RIGHTS AND OBLIGATIONS
IN RESPECT OF RECEIVABLES
SECTION 7.1
Rights of the Buyer
. Each Originator hereby authorizes the Buyer, the Servicer or their respective designees or assignees under the Receivables Purchase Agreement (including, without limitation, the Administrator) to take any and all steps in such Originator’s name necessary or desirable, in their respective determination, to collect all amounts due under any and all Receivables sold or otherwise conveyed or purported to be conveyed by it hereunder, including, without limitation, endorsing the name of such Originator on checks and other instruments representing Collections and enforcing such Receivables and the provisions of the related Contracts that concern payment and/or enforcement of rights to payment.
SECTION 7.2
Responsibilities of the Originators
. Anything herein to the contrary notwithstanding:
(a)
Collection Procedures
. Each Originator agrees to direct its respective Obligors to make payments of Receivables sold or otherwise conveyed or purported to be conveyed by it hereunder, directly to, or directly to a post office box related to, the relevant Lock-Box Account at a Lock-Box Bank. Each Originator further agrees to transfer any Collections of Receivables sold or conveyed by it hereunder that it receives directly to a Lock-Box Account within two (2) Business Days of receipt thereof, and agrees that all such Collections shall be deemed to be received in trust for the Buyer and the Administrator (for the benefit of the Purchasers).
(b)
Each Originator shall perform its obligations hereunder, and the exercise by the Buyer or its designee of its rights hereunder shall not relieve such Originator from such obligations.
(c)
None of the Buyer, the Servicer, the Purchasers, the Purchaser Agents or the Administrator shall have any obligation or liability to any Obligor or any other third Person with respect to any Receivables, Contracts related thereto or any other related agreements, nor shall the Buyer, the Servicer, the Purchasers, the Purchaser Agents or the Administrator be obligated to perform any of the obligations of such Originator thereunder.
(d)
Each Originator hereby grants to the Administrator an irrevocable power of attorney, with full power of substitution, coupled with an interest, during the occurrence and continuation of a Purchase and Sale Termination Event to take in the name of such Originator all steps necessary or advisable to endorse, negotiate or otherwise realize on any writing or other right of any kind held or transmitted by such Originator or transmitted or received by the Buyer (whether or not from such Originator) in connection with any Receivable sold or otherwise conveyed or purported to be conveyed by it hereunder or Related Right.
SECTION 7.3
Further Action Evidencing Purchases
. On or prior to the Closing Date, each Originator shall mark its master data processing records evidencing Pool Receivables and Contracts with a legend, acceptable to Buyer, evidencing that the Pool Receivables have been transferred in accordance with this Agreement and none of the Originators or Servicer shall change or remove such notation without the consent of Buyer. Each Originator agrees that from time to time, at its expense, it will promptly execute and deliver all further instruments and documents, and take all further action that the Buyer, the Servicer, or the Administrator may reasonably request in order to perfect, protect or more fully evidence the Receivables and Related Rights purchased by the Buyer hereunder, or to enable the Buyer to exercise or enforce any of its rights hereunder or under any other Transaction Document. Without limiting the generality of the foregoing, upon the request of the Buyer or the Administrator, such Originator will execute (if applicable), authorize and file such financing or continuation statements, or amendments thereto or assignments thereof, and such other instruments or notices, as may be necessary or appropriate.
Each Originator hereby authorizes the Buyer or its designee (including, without limitation, the Administrator) to file one or more financing or continuation statements, and amendments thereto and assignments thereof, without the signature of such Originator, relative to all or any of the Receivables sold or otherwise conveyed or purported to be conveyed by it hereunder and Related Rights now existing or hereafter generated by such Originator. If any Originator fails to perform any of its agreements or obligations under this Agreement, the Buyer or its designee (including, without limitation, the Administrator) may (but shall not be required to) itself perform, or cause the performance of, such agreement or obligation, and the expenses of the Buyer or its designee (including, without limitation, the Administrator) incurred in connection therewith shall be payable by such Originator.
SECTION 7.4
Application of Collections
. Any payment by an Obligor in respect of any indebtedness owed by it to any Originator shall, except as otherwise specified by such Obligor or required by applicable law and unless otherwise instructed by the Servicer (with the prior written consent of the Administrator) or the Administrator, be applied as a Collection of any Receivable or Receivables of such Obligor to the extent of any amounts then due and payable thereunder before being applied to any other indebtedness of such Obligor.
ARTICLE VIII
PURCHASE AND SALE TERMINATION EVENTS
SECTION 8.1
Purchase and Sale Termination Events
. Each of the following events or occurrences described in this
Section 8.1
shall constitute a “
Purchase and Sale Termination Event
”:
(a)
The Facility Termination Date (as defined in the Receivables Purchase Agreement) shall have occurred; or
(b)
Any Originator shall fail to make when due any payment or deposit to be made by it under this Agreement or any other Transaction Document to which it is a party and such failure shall remain unremedied for two (2) Business Days; or
(c)
Any representation or warranty made or deemed to be made by any Originator (or any of its officers) under or in connection with this Agreement, any other Transaction Documents to which it is a party, or any other information or report delivered pursuant hereto or thereto shall prove to have been incorrect or untrue in any material respect when made or deemed made or delivered,
provided
that such circumstance shall not constitute a Purchase and Sale Termination Event if such representation or warranty, or such information or report, is part of an Information Package, and is corrected promptly (but not later than fifteen (15) days) after the Originator has knowledge or receives notice thereof; and
provided further
that no breach of a representation or warranty set forth in
Section 5.14
or
5.20
shall constitute a Purchase and Sale Termination Event pursuant to this
clause (c)
if credit has been given for a reduction of the Purchase Price, the outstanding principal balance of the applicable Subordinated Note has been reduced or the applicable Originator has made a cash payment to the Buyer, in any case, as required pursuant to
Section 3.4(c)
with respect to such breach; or
(d)
Any Originator shall fail to perform or observe any other term, covenant or agreement contained in this Agreement or any other Transaction Document to which it is a party on its part to be performed or observed and such failure shall continue for fifteen (15) days after the earlier of such Originator’s knowledge or notice thereof.
SECTION 8.2
Remedies
.
(a)
Optional Termination
. Upon the occurrence and during the continuation of a Purchase and Sale Termination Event, the Buyer (and not the Servicer), with the prior written consent of the Administrator, shall have the option, by notice to the Originators (with a copy to the Administrator), to declare the Purchase Facility to be terminated.
(b)
Remedies Cumulative
. Upon any termination of the Purchase Facility pursuant to
Section 8.2(a)
, the Buyer shall have, in addition to all other rights and remedies under this Agreement, all other rights and remedies provided under the UCC of each applicable jurisdiction and other applicable laws, which rights shall be cumulative.
ARTICLE IX
INDEMNIFICATION
SECTION 9.1
Indemnities by the Originators
. Without limiting any other rights which the Buyer may have hereunder or under applicable law, each Originator, severally and for itself alone, and Meritor, jointly and severally with each Originator, hereby agrees to indemnify the Buyer and each of its officers, directors, employees and agents (each of the foregoing Persons being individually called a “
Purchase and Sale Indemnified Party
”), forthwith on demand, from and against any and all damages, losses, claims, judgments, liabilities and related costs and expenses, including reasonable attorneys’ fees and disbursements (all of the foregoing being collectively called “
Purchase and Sale Indemnified Amounts
”) awarded against or incurred by any of them arising out of or as a result of the failure of such Originator to perform its obligations under this Agreement or any other Transaction Document, or arising out of the claims asserted against a Purchase and Sale Indemnified Party relating to the transactions contemplated herein or therein or the use of proceeds thereof or therefrom;
excluding
,
however
, (i) Purchase and Sale Indemnified Amounts to the extent resulting from gross negligence or willful misconduct on the part of such Purchase and Sale Indemnified Party, (ii) any indemnification which has the effect of recourse for non-payment of the Receivables due to a discharge in bankruptcy or similar insolvency proceeding or other credit related reasons with respect to the relevant Obligor and (iii) any overall income or franchise taxes, in either case, imposed on the applicable Purchase and Sale Indemnified Party by the jurisdiction under whose laws such Purchase and Sale Indemnified Party is organized, operates or where its principal executive office is located or any political subdivision thereof. Without limiting the foregoing, and subject to the exclusions set forth in the preceding sentence, each Originator, severally for itself alone, and Meritor, jointly and severally with each Originator, shall indemnify each Purchase and Sale Indemnified Party for Purchase and Sale Indemnified Amounts relating to or resulting from:
(a)
the transfer by such Originator of an interest in any Receivable to any Person other than the Buyer;
(b)
the breach of any representation or warranty made by such Originator (or any of its officers) under or in connection with this Agreement or any other Transaction Document, or any information or report delivered by Originator pursuant hereto or thereto, which shall have been false or incorrect when made or deemed made;
(c)
the failure by such Originator to comply with any applicable law, rule or regulation with respect to any Receivable generated by such Originator sold or otherwise transferred or purported to be transferred hereunder or the related Contract, or the nonconformity of any Receivable generated by such Originator sold or otherwise transferred or purported to be transferred hereunder or the related Contract with any such applicable law, rule or regulation;
(d)
the failure by such Originator to vest and maintain vested in the Buyer an ownership interest in the Receivables generated by such Originator sold or otherwise transferred or purported to be transferred hereunder (and not reconveyed hereunder) free and clear of any Adverse Claim;
(e)
the failure to file, or any delay in filing, by such Originator financing statements or other similar instruments or documents under the UCC of any applicable jurisdiction or other applicable laws with respect to any Receivables or purported Receivables generated by such Originator sold or otherwise transferred or purported to be transferred hereunder, whether at the time of any purchase or at any subsequent time to the extent required hereunder;
(f)
any dispute, claim, offset or defense (other than discharge in bankruptcy or similar insolvency proceeding of an Obligor or other credit related reasons) of the Obligor to the payment of any Receivable or purported Receivable generated by such Originator sold or otherwise transferred or purported to be transferred hereunder (including, without limitation, a defense based on such Receivable’s or the related Contract’s 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 services related to any such Receivable or the furnishing of or failure to furnish such services;
(g)
any product liability claim arising out of or in connection with services that are the subject of any Receivable generated by such Originator;
(h)
any Taxes which are required to be paid by reason of the purchase or ownership of the Receivables generated by such Originator or any Related Security connected with any such Receivables; and
(i) any indemnification claim made pursuant to Section 1.19 of the Receivables Purchase Agreement to the extent such claim arises (directly or indirectly) from the issuance of any Letter of Credit at the request of such Originator (or, in the case of Meritor, at the request of any Originator) pursuant to
Section 3.3
;
provided
,
however
, that the Originators and Meritor shall not have any obligation to reimburse any drawing on any such Letter of Credit or to indemnify any Purchase and Sale Indemnified Party for any such reimbursement.
ARTICLE X
MISCELLANEOUS
SECTION 10.1
Amendments, etc
.
(a)
The provisions of this Agreement may from time to time be amended, modified or waived, if such amendment, modification or waiver is in writing and executed by the Buyer and each Originator, with the prior written consent of the Administrator and the Majority Purchaser Agents.
(b)
No failure or delay on the part of the Buyer, the Servicer, any Originator or any third-party beneficiary in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No notice to or demand on the Buyer, the Servicer or any Originator in any case shall entitle it to any notice or demand in similar or other circumstances. No waiver or approval by the Buyer or the Servicer under this Agreement shall, except as may otherwise be stated in such waiver or approval, be applicable to subsequent transactions. No waiver or approval under this Agreement shall require any similar or dissimilar waiver or approval thereafter to be granted hereunder.
(c)
The Transaction Documents contain a final and complete integration of all prior expressions by the parties hereto with respect to the subject matter thereof and shall constitute the entire agreement among the parties hereto with respect to the subject matter thereof, superseding all prior oral or written understandings.
SECTION 10.2
Notices, etc
. All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile communication) and shall be delivered or sent by facsimile, or by overnight mail, to the intended party at the mailing address or facsimile number of such party set forth under its name on its signature page hereto or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto or in the case of the Administrator or any Purchaser Agent, at their respective address for notices pursuant to the Receivables Purchase Agreement. All such notices and communications shall be effective (i) if delivered by overnight mail, when received, and (ii) if transmitted by facsimile, when sent, receipt confirmed by telephone or electronic means.
SECTION 10.3
No Waiver; Cumulative Remedies
. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. Without limiting the foregoing, each Originator hereby authorizes the Buyer, at any time and from time to time, to the fullest extent permitted by law, to set off, against any obligations of such Originator to the Buyer arising in connection with the Transaction Documents (including, without limitation, amounts payable pursuant to
Section 9.1
) that are then due and payable or that are not then due and payable but have accrued, any and all indebtedness at any time owing by the Buyer to or for the credit or the account of such Originator.
SECTION 10.4
Binding Effect; Assignability
. This Agreement shall be binding upon and inure to the benefit of the Buyer and each Originator and their respective successors and permitted assigns. No Originator may assign any of its rights hereunder or any interest herein without the prior written consent of the Buyer and the Administrator, except as otherwise herein specifically provided. This Agreement shall create and constitute the continuing obligations of the parties hereto in accordance with its terms, and shall remain in full force and effect until such time as the parties hereto shall agree. The rights and remedies with respect to any breach of any representation and warranty made by any Originator pursuant to
Article V
and the indemnification and payment provisions of
Article IX
and
Section 10.6
shall be continuing and shall survive any termination of this Agreement.
SECTION 10.5
Governing Law
. THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF A SECURITY INTEREST OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
SECTION 10.6
Costs, Expenses and Taxes
. In addition to the obligations of the Originators under
Article IX
, each Originator, severally and for itself alone, and Meritor, jointly and severally with each Originator, agrees to pay on demand:
(a)
to the Buyer (and any successor and permitted assigns thereof) and any third-party beneficiary of the Buyer’s rights hereunder all reasonable costs and expenses incurred by such Person in connection with the enforcement of this Agreement and the other Transaction Documents; and
(b)
all stamp, franchise and other taxes and fees payable in connection with the execution, delivery, filing and recording of this Agreement or the other Transaction Documents to be delivered hereunder, and agrees to indemnify each Purchase and Sale Indemnified Party against any liabilities with respect to or resulting from any delay in paying or omitting to pay such taxes and fees.
SECTION 10.7
SUBMISSION TO JURISDICTION
. 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 OF THE PARTIES HERETO CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES 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, THAT 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. EACH OF THE PARTIES HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH SERVICE MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
SECTION 10.8
WAIVER OF JURY TRIAL
. EACH OF THE PARTIES HERETO WAIVES ITS 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. EACH OF THE PARTIES HERETO AGREES 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 THAT 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.
SECTION 10.9
Captions and Cross References; Incorporation by Reference
. The various captions (including, without limitation, the table of contents) in this Agreement are included for convenience only and shall not affect the meaning or interpretation of any provision of this Agreement. References in this Agreement to any underscored Section or Exhibit are to such Section or Exhibit of this Agreement, as the case may be. The Exhibits hereto are hereby incorporated by reference into and made a part of this Agreement.
SECTION 10.10
Execution in Counterparts
. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement.
SECTION 10.11
Acknowledgment and Agreement
. By execution below, each Originator expressly acknowledges and agrees that all of the Buyer’s rights, title, and interests in, to, and under this Agreement (but not its obligations), shall be assigned by the Buyer to the Administrator (for the benefit of the Purchasers) pursuant to the Receivables Purchase Agreement, and each Originator consents to such assignment. Each of the parties hereto acknowledges and agrees that the Purchasers, the Purchaser Agents and the Administrator are third-party beneficiaries of the rights of the Buyer arising hereunder and under the other Transaction Documents to which any Originator is a party, and notwithstanding anything to the contrary contained herein or in any other Transaction Document, during the occurrence and continuation of a Termination Event under the Receivables Purchase Agreement, the Administrator, and not the Buyer, shall have the sole right to exercise all such rights and related remedies.
SECTION 10.12
No Proceeding
. Each Originator hereby agrees that it will not institute, or join any other Person in instituting, against the Buyer any Insolvency Proceeding so long as any of the Subordinated Notes remains outstanding and for at least one year and one day following the day on which all amounts owed by the Buyer under this Agreement and the other Transaction Documents are paid in full. Each Originator further agrees that notwithstanding any provisions contained in this Agreement to the contrary, the Buyer shall not, and shall not be obligated to, pay any amount in respect of any Subordinated Note or otherwise to such Originator pursuant to this Agreement unless the Buyer has received funds which may, subject to Section 1.4 of the Receivables Purchase Agreement, be used to make such payment. Any amount which the Buyer does not pay pursuant to the operation of the preceding sentence shall not constitute a claim (as defined in §101 of the Bankruptcy Code) against or corporate obligation of the Buyer by such Originator for any such insufficiency unless and until the provisions of the foregoing sentence are satisfied. The agreements in this
Section 10.12
shall survive any termination of this Agreement.
SECTION 10.13
Limited Recourse
. Except as explicitly set forth herein, the obligations of the Buyer under this Agreement or any other Transaction Documents to which it is a party are solely the obligations of the Buyer. No recourse under any Transaction Document shall be had against, and no liability shall attach to, any officer, employee, director, or beneficiary, whether directly or indirectly, of the Buyer. The agreements in this
Section 10.13
shall survive any termination of this Agreement.
SECTION 10.14
Amendment and Restatement of Existing Agreement
. This Agreement amends and restates in its entirety, as of the date hereof, the Existing Agreement. Upon the effectiveness of this Agreement in accordance with its terms, the terms and provisions of the Existing Agreement shall, subject to this paragraph, be superseded hereby in their entirety. Notwithstanding the foregoing and for the avoidance of doubt, (a) all indemnification obligations of the Originators under the Existing Agreement shall survive this Agreement, (b) all purchases and sales under the Existing Agreement by the Originators to the Company are ratified and confirmed as set forth in
Section 1.2(c)
and shall survive this Agreement and (c) the security interests granted by the Originators pursuant to
Section 2.4
of the Existing Agreement shall remain in full force and effect and shall survive this Agreement as security for all obligations of the Originators under the Existing Agreement until such obligations have been finally and fully paid and performed. Upon the effectiveness of this Agreement, each reference to the Existing Agreement in any other document, instrument or agreement shall mean and be a reference to this Agreement. Nothing contained herein, unless expressly herein stated to the contrary, is intended to amend, modify or otherwise affect any other instrument, document or agreement executed and or delivered in connection with the Existing Agreement.
[Signature Pages Follow]
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.
MERITOR HEAVY VEHICLE BRAKING SYSTEMS (USA), LLC
, as an Originator
By:
/s/ Carl D. Anderson II
Name: Carl D. Anderson II
Title: Treasurer
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Address:
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Meritor Heavy Vehicle Braking
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Systems (USA), LLC
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2135 West Maple Road
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Troy, MI48084-7186
|
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Attention:
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Treasurer
|
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Telephone:
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248-435-1588
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|
email:
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Carl.Anderson@Meritor.com
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701741768 12403015
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S-4
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Fourth Amended and Restated
Purchase and Sale Agreement
|
MERITOR HEAVY VEHICLE SYSTEMS, LLC
, as an Originator
By:
/s/ Carl D. Anderson II
Name: Carl D. Anderson II
Title: Treasurer
|
|
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|
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Address:
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Meritor Heavy Vehicle Systems,
|
|
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LLC
|
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2135 West Maple Road
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Troy, MI48084-7186
|
|
Attention:
|
Treasurer
|
|
Telephone:
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248-435-1588
|
|
Email:
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Carl.Anderson@Meritor.com
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701741768 12403015
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S-4
|
Fourth Amended and Restated
Purchase and Sale Agreement
|
MERITOR, INC.
,
as Servicer
By:
/s/ Carl D. Anderson II
Name: Carl D. Anderson II
Title: President and Treasurer
|
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Address:
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Meritor, Inc.
|
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2135 West Maple Road
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Troy, MI48084-7186
|
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Attention:
|
Treasurer
|
|
Telephone:
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248-435-1588
|
|
email:
|
Carl.Anderson@Meritor.com
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701741768 12403015
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S-4
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Fourth Amended and Restated
Purchase and Sale Agreement
|
ARVINMERITOR RECEIVABLES CORPORATION
, as Buyer
By
:/s/ Carl D. Anderson II
Name:Carl D. Anderson II
Title: President and Treasurer
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Address:
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ArvinMeritor Receivables
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Corporation
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2135 West Maple Road
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Troy, MI48084-7186
|
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Attention:
|
Treasurer
|
|
Telephone:
|
248-435-1588
|
|
email:
|
Carl.Anderson@Meritor.com
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701741768 12403015
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S-4
|
Fourth Amended and Restated
Purchase and Sale Agreement
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Schedule I
LOCATION OF EACH ORIGINATOR
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Originator
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Location
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Meritor Heavy Vehicle Braking Systems (USA), LLC
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Delaware
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Meritor Heavy Vehicle Systems, LLC
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Delaware
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Schedule II
LOCATION OF BOOKS AND RECORDS OF ORIGINATORS
|
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Originator
|
Location of Books and Records
|
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Meritor Heavy Vehicle Braking Systems (USA), LLC
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2135 West Maple Road
Troy, MI48084-7186
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Meritor Heavy Vehicle Systems, LLC
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2135 West Maple Road
Troy, MI48084-7186
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Schedule III
TRADE NAMES
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Legal Name
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Trade Names
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Meritor Heavy Vehicle Braking Systems (USA), LLC
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•
Meritor Heavy Vehicle Braking Systems
•
Meritor
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Meritor Heavy Vehicle Systems, LLC
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•
Meritor Heavy Vehicle Systems
•
Meritor
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Schedule IV
ACTIONS/SUITS
None.
Exhibit A
FORM OF PURCHASE REPORT
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Originator:
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[Name of Originator]
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Purchaser:
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ArvinMeritor Receivables Corporation
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Date:
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[_________________]
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1.
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Outstanding Balance of Receivables Purchased:
|
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2.
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98.25% (representing a 175 basis point fair market value discount for uncertainty of payment and the time value of money)
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3.
|
Purchase Price (1 x 2) = $ __________
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4.
|
Reductions of the Purchase Price pursuant to
Section 3.4(a)
and
(b)
: [______]
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Exhibit B
SUBORDINATED NOTE
New York, New York
[__________] [__], 20[__]
FOR VALUE RECEIVED, the undersigned, ARVINMERITOR RECEIVABLES CORPORATION, a Delaware corporation (the “
Buyer
”), promises to pay to [________________], a [______________] (“
Originator
”), on the terms and subject to the conditions set forth herein and in the Purchase and Sale Agreement referred to below, the aggregate unpaid Purchase Price of all Receivables purchased by the Buyer from Originator pursuant to such Purchase and Sale Agreement, as such unpaid Purchase Price is shown in the records of Servicer.
This Subordinated Note amends, restates, and replaces that certain Amended and Restated Revolving Subordinated Promissory Note, dated as of September 8, 2009, made by the Buyer in favor of the Originator pursuant to the Existing Agreement, as defined in the Purchase and Sale Agreement described below (the “
Replaced Note
”). This Subordinated Note is not intended to be, nor shall it be deemed to be, a repayment of the Replaced Note.
1.
Purchase and Sale Agreement
. This Subordinated Note is one of the Subordinated Notes described in, and is subject to the terms and conditions set forth in, that certain Fourth Amended and Restated Purchase and Sale Agreement, dated as of June 18, 2012 (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “
Purchase and Sale Agreement
”), among the Buyer, the Originator, and the various entities listed thereto as Originators. Reference is hereby made to the Purchase and Sale Agreement for a statement of certain other rights and obligations of the Buyer and the Originator.
2.
Definitions
. Capitalized terms used (but not defined) herein have the meanings assigned thereto in the Purchase and Sale Agreement and in
Exhibit I
to the Receivables Purchase Agreement (as defined in the Purchase and Sale Agreement). In addition, as used herein, the following terms have the following meanings:
“
Bankruptcy Proceedings
” has the meaning set forth in
clause (b)
of
paragraph 9
hereof.
“
Final Maturity Date
” means the Payment Date immediately following the date that falls one year and one day after the Facility Termination Date.
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701741768 12403015
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Exhibit B
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“
Senior Interests
” means, collectively, (i) all accrued Discount on the Purchased Interest, (ii) the fees referred to in
Section 1.5
of the Receivables Purchase Agreement, (iii) all amounts payable pursuant to
Sections 1.7
,
1.8
,
1.10
,
1.14
,
1.19
,
3.1
or
5.4
of the Receivables Purchase Agreement, (iv) the Aggregate Capital and (v) all other obligations of the Buyer and the Servicer that are due and payable, to (a) the Purchasers, the Purchaser Agents, the Administrator and their respective successors, permitted transferees and assigns arising in connection with the Transaction Documents and (b) any Indemnified Party or Affected Person arising in connection with the Receivables Purchase Agreement, in each case, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due, together with any and all interest and Discount accruing on any such amount after the commencement of any Bankruptcy Proceedings, notwithstanding any provision or rule of law that might restrict the rights of any Senior Interest Holder, as against the Buyer or anyone else, to collect such interest.
“
Senior Interest Holders
” means, collectively, the Purchasers, the Administrator, the Purchaser Agents and the Indemnified Parties and Affected Persons.
“
Subordination Provisions
” means, collectively,
clauses (a)
through
(l)
of
paragraph 9
hereof.
3.
Interest
. Subject to the Subordination Provisions set forth below, the Buyer promises to pay interest on this Subordinated Note as follows: to (but excluding) the date on which the entire aggregate unpaid Purchase Price is fully paid, the aggregate unpaid Purchase Price from time to time outstanding shall bear interest at a rate
perannum
equal to the rate of interest publicly announced from time to time by PNC Bank, National Association, as its “base rate”, “reference rate” or other comparable rate, as determined by the Servicer.
4.
Interest Payment Dates
. Subject to the Subordination Provisions set forth below, the Buyer shall pay accrued interest on this Subordinated Note on each Monthly Settlement Date, and shall pay accrued interest on the amount of each principal payment made in cash on a date other than a Monthly Settlement Date at the time of such principal payment.
5.
Basis of Computation
. Interest accrued hereunder shall be computed for the actual number of days elapsed on the basis of a 365- or 366-day year.
6.
Principal Payment Dates
. Subject to the Subordination Provisions set forth below, payments of the principal amount of this Subordinated Note shall be made as follows:
(a)
The principal amount of this Subordinated Note shall be reduced by an amount equal to each payment deemed made pursuant to
Sections 3.3 or 3.4
of the Purchase and Sale Agreement; and
(b)
The entire remaining unpaid Purchase Price of all Receivables purchased by the Buyer from Originator pursuant to the Purchase and Sale Agreement shall be paid on the Final Maturity Date.
Subject to the Subordination Provisions set forth below, the principal amount of and accrued interest on this Subordinated Note may be prepaid by, and in the sole discretion of the Buyer, on any Business Day without premium or penalty.
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701741768 12403015
|
Exhibit B
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7.
Payment Mechanics
. All payments of principal and interest hereunder are to be made in lawful money of the United States of America in the manner specified in
Article III
of the Purchase and Sale Agreement.
8.
Enforcement Expenses
. In addition to and not in limitation of the foregoing, but subject to the Subordination Provisions set forth below and to any limitation imposed by applicable law, the Buyer agrees to pay all expenses, including reasonable attorneys’ fees and legal expenses, incurred by Originator in seeking to collect any amounts payable hereunder which are not paid when due.
9.
Subordination Provisions
. The Buyer covenants and agrees, and Originator and any other holder of this Subordinated Note (collectively, Originator and any such other holder are called the “
Holder
”), by its acceptance of this Subordinated Note, likewise covenants and agrees on behalf of itself and any holder of this Subordinated Note, that the payment of the principal amount of and interest on this Subordinated Note is hereby expressly subordinated in right of payment to the payment and performance of the Senior Interests to the extent and in the manner set forth in the following clauses of this
paragraph 9
:
(a)
No payment or other distribution of the Buyer’s assets of any kind or character, whether in cash, securities, or other rights or property, shall be made on account of this Subordinated Note except to the extent such payment or other distribution is (i) permitted under
Section 1(n)
of
Exhibit IV
to the Receivables Purchase Agreement or (ii) made pursuant to
clause (a)
or
(b)
of
paragraph 6
of this Subordinated Note;
(b)
In the event of any dissolution, winding up, liquidation, readjustment, reorganization or other similar event relating to the Buyer, whether voluntary or involuntary, partial or complete, and whether in bankruptcy, insolvency or receivership proceedings, or upon an assignment for the benefit of creditors, or any other marshalling of the assets and liabilities of the Buyer or any sale of all or substantially all of the assets of the Buyer other than as permitted by the Purchase and Sale Agreement (such proceedings being herein collectively called “
Bankruptcy Proceedings
”), the Senior Interests shall first be paid and performed in full and in cash before Originator shall be entitled to receive and to retain any payment or distribution in respect of this Subordinated Note. In order to implement the foregoing: (i) all payments and distributions of any kind or character in respect of this Subordinated Note to which Holder would be entitled except for this
clause (b)
shall be made directly to the Administrator (for the benefit of the Senior Interest Holders); (ii) Holder shall promptly file a claim or claims, in the form required in any Bankruptcy Proceedings, for the full outstanding amount of this Subordinated Note, and shall use commercially reasonable efforts to cause said claim or claims to be approved and all payments and other distributions in respect thereof to be made directly to the Administrator (for the benefit of the Senior Interest Holders) until the Senior Interests shall have been paid and performed in full and in cash; and (iii) Holder hereby irrevocably agrees that Administrator (acting on behalf of the Purchasers), may in the name of Holder or otherwise, demand, sue for, collect, receive and receipt for any and all such payments or distributions, and file, prove and vote or consent in any such Bankruptcy Proceedings with respect to any and all claims of Holder relating to this Subordinated Note, in each case until the Senior Interests shall have been paid and performed in full and in cash;
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701741768 12403015
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Exhibit B
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(c)
In the event that Holder receives any payment or other distribution of any kind or character from the Buyer or from any other source whatsoever, in respect of this Subordinated Note, other than as expressly permitted by the terms of this Subordinated Note, such payment or other distribution shall be received in trust for the Senior Interest Holders and shall be turned over by Holder to the Administrator (for the benefit of the Senior Interest Holders) forthwith. Holder will mark its books and records so as clearly to indicate that this Subordinated Note is subordinated in accordance with the terms hereof. All payments and distributions received by the Administrator in respect of this Subordinated Note, to the extent received in or converted into cash, may be applied by the Administrator (for the benefit of the Senior Interest Holders) first to the payment of any and all expenses (including reasonable attorneys’ fees and legal expenses) paid or incurred by the Senior Interest Holders in enforcing these Subordination Provisions, or in endeavoring to collect or realize upon this Subordinated Note, and any balance thereof shall, solely as between Originator and the Senior Interest Holders, be applied by the Administrator (in the order of application set forth in
Section 1.4(d)
of the Receivables Purchase Agreement) toward the payment of the Senior Interests; but as between the Buyer and its creditors, no such payments or distributions of any kind or character shall be deemed to be payments or distributions in respect of the Senior Interests;
(d)
Notwithstanding any payments or distributions received by the Senior Interest Holders in respect of this Subordinated Note, while any Bankruptcy Proceedings are pending Holder shall not be subrogated to the then existing rights of the Senior Interest Holders in respect of the Senior Interests until the Senior Interests have been paid and performed in full and in cash. If no Bankruptcy Proceedings are pending, Holder shall only be entitled to exercise any subrogation rights that it may acquire (by reason of a payment or distribution to the Senior Interest Holders in respect of this Subordinated Note) to the extent that any payment arising out of the exercise of such rights would be permitted under
Section 1(n)
of
Exhibit IV
to the Receivables Purchase Agreement;
(e)
These Subordination Provisions are intended solely for the purpose of defining the relative rights of Holder, on the one hand, and the Senior Interest Holders on the other hand. Nothing contained in these Subordination Provisions or elsewhere in this Subordinated Note is intended to or shall impair, as between the Buyer, its creditors (other than the Senior Interest Holders) and Holder, the Buyer’s obligation, which is unconditional and absolute, to pay Holder the principal of and interest on this Subordinated Note as and when the same shall become due and payable in accordance with the terms hereof or to affect the relative rights of Holder and creditors of the Buyer (other than the Senior Interest Holders);
(f)
Holder shall not, until the Senior Interests have been paid and performed in full and in cash, (i) cancel, waive, forgive, transfer or assign, or commence legal proceedings to enforce or collect, or subordinate to any obligation of the Buyer, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, or now or hereafter existing, or due or to become due, other than the Senior Interests, this Subordinated Note or any rights in respect hereof or (ii) convert this Subordinated Note into an equity interest in the Buyer, unless Holder shall, in either case, have received the prior written consent of the Administrator;
(g)
Holder shall not, without the advance written consent of the Administrator and Purchaser, commence, or join with any other Person in commencing, any Bankruptcy Proceedings with respect to the Buyer until at least one year and one day shall have passed since the Senior Interests shall have been paid and performed in full and in cash;
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701741768 12403015
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Exhibit B
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(h)
If, at any time, any payment (in whole or in part) of any Senior Interest is rescinded or must be restored or returned by a Senior Interest Holder (whether in connection with Bankruptcy Proceedings or otherwise), these Subordination Provisions shall continue to be effective or shall be reinstated, as the case may be, as though such payment had not been made;
(i)
Each of the Senior Interest Holders may, from time to time, at its sole discretion, without notice to Holder, and without waiving any of its rights under these Subordination Provisions, take any or all of the following actions: (i) retain or obtain an interest in any property to secure any of the Senior Interests; (ii) retain or obtain the primary or secondary obligations of any other obligor or obligors with respect to any of the Senior Interests; (iii) extend or renew for one or more periods (whether or not longer than the original period), alter or exchange any of the Senior Interests, or release or compromise any obligation of any nature with respect to any of the Senior Interests; (iv) amend, supplement, amend and restate, or otherwise modify any Transaction Document; and (v) release its security interest in, or surrender, release or permit any substitution or exchange for all or any part of any rights or property securing any of the Senior Interests, or extend or renew for one or more periods (whether or not longer than the original period), or release, compromise, alter or exchange any obligations of any nature of any obligor with respect to any such rights or property;
(j)
Holder hereby waives: (i) notice of acceptance of these Subordination Provisions by any of the Senior Interest Holders; (ii) notice of the existence, creation, non-payment or non-performance of all or any of the Senior Interests; and (iii) all diligence in enforcement, collection or protection of, or realization upon, the Senior Interests, or any thereof, or any security therefor;
(k)
Each of the Senior Interest Holders may, from time to time, on the terms and subject to the conditions set forth in the Transaction Documents to which such Persons are party, but without notice to Holder, assign or transfer any or all of the Senior Interests, or any interest therein; and, notwithstanding any such assignment or transfer or any subsequent assignment or transfer thereof, such Senior Interests shall be and remain Senior Interests for the purposes of these Subordination Provisions, and every immediate and successive assignee or transferee of any of the Senior Interests or of any interest of such assignee or transferee in the Senior Interests shall be entitled to the benefits of these Subordination Provisions to the same extent as if such assignee or transferee were the assignor or transferor; and
(l)
These Subordination Provisions constitute a continuing offer from the holder of this Subordinated Note to all Persons who become the holders of, or who continue to hold, Senior Interests; and these Subordination Provisions are made for the benefit of the Senior Interest Holders, and the Administrator may proceed to enforce such provisions on behalf of each of such Persons.
10.
General
. No failure or delay on the part of Originator in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No amendment, modification or waiver of, or consent with respect to, any provision of this Subordinated Note shall in any event be effective unless (i) the same shall be in writing and signed and delivered by the Buyer and Holder and (ii) all consents required for such actions under the Transaction Documents shall have been received by the appropriate Persons.
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701741768 12403015
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Exhibit B
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11.
Maximum Interest
. Notwithstanding anything in this Subordinated Note to the contrary, the Buyer shall never be required to pay unearned interest on any amount outstanding hereunder and shall never be required to pay interest on the principal amount outstanding hereunder at a rate in excess of the maximum nonusurious interest rate that may be contracted for, charged or received under applicable federal or state law (such maximum rate being herein called the “
Highest Lawful Rate
”). If the effective rate of interest which would otherwise be payable under this Subordinated Note would exceed the Highest Lawful Rate, or if the holder of this Subordinated Note shall receive any unearned interest or shall receive monies that are deemed to constitute interest which would increase the effective rate of interest payable by the Buyer under this Subordinated Note to a rate in excess of the Highest Lawful Rate, then (i) the amount of interest which would otherwise be payable by the Buyer under this Subordinated Note shall be reduced to the amount allowed by applicable law, and (ii) any unearned interest paid by the Buyer or any interest paid by the Buyer in excess of the Highest Lawful Rate shall be refunded to the Buyer. Without limitation of the foregoing, all calculations of the rate of interest contracted for, charged or received by Originator under this Subordinated Note that are made for the purpose of determining whether such rate exceeds the Highest Lawful Rate applicable to Originator (such Highest Lawful Rate being herein called the “
Originator’s Maximum Permissible Rate
”) shall be made, to the extent permitted by usury laws applicable to Originator (now or hereafter enacted), by amortizing, prorating and spreading in equal parts during the actual period during which any amount has been outstanding hereunder all interest at any time contracted for, charged or received by Originator in connection herewith. If at any time and from time to time (i) the amount of interest payable to Originator on any date shall be computed at Originator’s Maximum Permissible Rate pursuant to the provisions of the foregoing sentence and (ii) in respect of any subsequent interest computation period the amount of interest otherwise payable to Originator would be less than the amount of interest payable to Originator computed at Originator’s Maximum Permissible Rate, then the amount of interest payable to Originator in respect of such subsequent interest computation period shall continue to be computed at Originator’s Maximum Permissible Rate until the total amount of interest payable to Originator shall equal the total amount of interest which would have been payable to Originator if the total amount of interest had been computed without giving effect to the provisions of the foregoing sentence.
SECTION 1.
Governing Law
. THIS SUBORDINATED NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY OTHERWISE APPLICABLE CONFLICTS OF LAW PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK)
.
12.
Captions
. Paragraph captions used in this Subordinated Note are for convenience only and shall not affect the meaning or interpretation of any provision of this Subordinated Note.
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701741768 12403015
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Exhibit B
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IN WITNESS WHEREOF, the Buyer has caused this Subordinated Note to be executed as of the date first written above.
ARVINMERITOR RECEIVABLES CORPORATION
By:
Name:
Title:
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701741768 12403015
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Exhibit B
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Exhibit C
FORM OF JOINDER AGREEMENT
THIS JOINDER AGREEMENT, dated as of ___________, 20___ (this “
Agreement
”) is executed by__________, a [corporation] organized under the laws of __________ (the “
Additional Originator
”), with its principal place of business located at __________.
BACKGROUND:
A.
ArvinMeritor Receivables Corporation, a Delaware corporation (the “
Buyer
”) and the various entities from time to time party thereto, as Originators (collectively, the “
Originators
”), have entered into that certain Fourth Amended and Restated Purchase and Sale Agreement, dated as of June 18, 2012 (as amended, restated, supplemented or otherwise modified through the date hereof, and as it may be further amended, restated, supplemented or otherwise modified from time to time, the “
Purchase and Sale Agreement
”).
B.
The Additional Originator desires to become a Originator pursuant to
Section 4.3
of the Purchase and Sale Agreement.
NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Additional Originator hereby agrees as follows:
SECTION 1.
Definitions
. Capitalized terms used in this Agreement and not otherwise defined herein shall have the meanings assigned thereto in the Purchase and Sale Agreement or in the Receivables Purchase Agreement (as defined in the Purchase and Sale Agreement).
SECTION 2.
Transaction Documents
. The Additional Originator hereby agrees that it shall be bound by all of the terms, conditions and provisions of, and shall be deemed to be a party to (as if it were an original signatory to), the Purchase and Sale Agreement and each of the other relevant Transaction Documents. From and after the later of the date hereof and the date that the Additional Originator has complied with all of the requirements of
Section 4.3
of the Purchase and Sale Agreement, the Additional Originator shall be an Originator for all purposes of the Purchase and Sale Agreement and all other Transaction Documents. The Additional Originator hereby acknowledges that it has received copies of the Purchase and Sale Agreement and the other Transaction Documents.
SECTION 3.
Representations and Warranties
. The Additional Originator hereby makes all of the representations and warranties set forth in
Article V
(to the extent applicable) of the Purchase and Sale Agreement as of the date hereof (unless such representations or warranties relate to an earlier date, in which case as of such earlier date), as if such representations and warranties were fully set forth herein. The Additional Originator hereby represents and warrants that its location (as defined in the applicable UCC) is [____________________], and the offices where the Additional Originator keeps all of its Records and Related Security is as follows:
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701741768 12403015
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Exhibit C
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SECTION 4.
Miscellaneous
. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without regard to any otherwise applicable conflicts of law principles (other than Sections 5-1401 and 5-1402 of the General Obligations Law of the State of New York). This Agreement is executed by the Additional Originator for the benefit of the Buyer, and its assigns, and each of the foregoing parties may rely hereon. This Agreement shall be binding upon, and shall inure to the benefit of, the Additional Originator and its successors and permitted assigns.
[Signature Pages Follow]
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701741768 12403015
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Exhibit C
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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be executed by its duly authorized officer as of the date and year first above written.
[NAME OF ADDITIONAL ORIGINATOR]
By:
Name:
Title:
Consented to:
ARVINMERITOR RECEIVABLES CORPORATION
By:
Name:
Title:
Acknowledged by:
PNC BANK, NATIONAL ASSOCIATION,
as Administrator
By:
Name:
Title:
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701741768 12403015
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Exhibit C
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[PURCHASER AGENTS]
By:
Name:
Title:
MERITOR, INC.,
as Performance Guarantor
By:
Name:
Title:
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701741768 12403015
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Exhibit C
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RECEIVABLES PURCHASE AGREEMENT
DATED AS OF JUNE 18, 2012
BY AND AMONG
ARVINMERITOR RECEIVABLES CORPORATION,
as Seller,
MERITOR, INC.
as initial Servicer,
THE VARIOUS CONDUIT PURCHASERS, RELATED COMMITTED PURCHASERS, LC PARTICIPANTS AND PURCHASER AGENTS FROM TIME TO TIME PARTY HERETO,
PNC BANK, NATIONAL ASSOCIATION,
as LC Bank,
AND
PNC BANK, NATIONAL ASSOCIATION,
as Administrator
TABLE OF CONTENTS
(continued)
Page
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ARTICLE I.
|
AMOUNTS AND TERMS OF THE PURCHASES
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1
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Section 1.1
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Purchase Facility
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1
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Section 1.2
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Making Purchases
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3
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Section 1.3
|
Purchased Interest Computation
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5
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Section 1.4
|
Settlement Procedures
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6
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Section 1.5
|
Fees
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10
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Section 1.6
|
Payments and Computations, Etc.
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10
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Section 1.7
|
Increased Costs
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11
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Section 1.8
|
Requirements of Law
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12
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Section 1.9
|
Inability to Determine the Euro-Rate
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13
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Section 1.10
|
Taxes
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14
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Section 1.11
|
Letters of Credit
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15
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Section 1.12
|
Issuance of Letters of Credit; Participations
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15
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Section 1.13
|
Requirements For Issuance of Letters of Credit.
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17
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Section 1.14
|
Disbursements, Reimbursement
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17
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Section 1.15
|
Repayment of Participation Advances
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18
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Section 1.16
|
Documentation
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19
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Section 1.17
|
Determination to Honor Drawing Request
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19
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Section 1.18
|
Nature of Participation and Reimbursement Obligations
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19
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Section 1.19
|
Indemnity
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21
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Section 1.20
|
Liability for Acts and Omissions
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21
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Section 1.21
|
Intended Tax Treatment
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22
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Section 1.22
|
Mitigation of Obligations; Replacement of Purchasers
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22
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ARTICLE II.
|
REPRESENTATIONS AND WARRANTIES; COVENANTS; TERMINATION EVENTS
|
24
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Section 2.1
|
Representations and Warranties; Covenants
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24
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Section 2.2
|
Termination Events
|
24
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ARTICLE III.
|
INDEMNIFICATION
|
24
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Section 3.1
|
Indemnities by the Seller
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24
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Section 3.2
|
Indemnities by the Servicer
|
26
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ARTICLE IV.
|
ADMINISTRATION AND COLLECTIONS
|
27
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Section 4.1
|
Appointment of the Servicer
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27
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Section 4.2
|
Duties of the Servicer
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28
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Section 4.3
|
Account Arrangements
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29
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Section 4.4
|
Enforcement Rights
|
29
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Section 4.5
|
Responsibilities of the Seller
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30
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Section 4.6
|
Servicing Fee
|
30
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Section 4.7
|
Authorization and Action of the Administrator and Purchaser Agents
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31
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Section 4.8
|
Nature of Administrator's Duties; Delegation of Administrator's Duties; Exculpatory Duties
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32
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Section 4.9
|
UCC Filings
|
33
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Section 4.10
|
Agent's Reliance, Etc
|
33
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Section 4.11
|
Administrator and Affiliates
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34
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Section 4.12
|
Notice of Termination Events
|
35
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TABLE OF CONTENTS
(continued)
Page
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Section 4.13
|
Non-Reliance on Administrator, Purchaser Agents and other Purchasers; Administrators and Affiliates
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35
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Section 4.14
|
Indemnification
|
36
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Section 4.15
|
Successor Administrator
|
36
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ARTICLE V.
|
MISCELLANEOUS
|
37
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Section 5.1
|
Amendments, Etc
|
37
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Section 5.2
|
Notices, Etc
|
37
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|
Section 5.3
|
Successors and Assigns; Assignability; Participations
|
38
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Section 5.4
|
Costs and Expenses
|
40
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Section 5.5
|
No Proceedings; Limitation on Payments
|
41
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Section 5.6
|
Confidentiality
|
41
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Section 5.7
|
GOVERNING LAW AND JURISDICTION
|
42
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Section 5.8
|
Execution in Counterparts
|
43
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Section 5.9
|
Survival of Termination
|
43
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Section 5.10
|
WAIVER OF JURY TRIAL
|
43
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Section 5.11
|
Entire Agreement
|
43
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Section 5.12
|
Headings
|
43
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Section 5.13
|
Right of Setoff
|
44
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Section 5.14
|
Purchaser Groups' Liabilities
|
44
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Section 5.15
|
Sharing of Recoveries
|
44
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Section 5.16
|
USA Patriot Act
|
44
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EXHIBIT I
|
DEFINITIONS
|
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EXHIBIT II
|
CONDITIONS OF PURCHASES
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EXHIBIT III
|
REPRESENTATIONS AND WARRANTIES
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EXHIBIT IV
|
COVENANTS
|
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EXHIBIT V
|
TERMINATION EVENTS
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SCHEDULE I
|
CREDIT AND COLLECTION POLICY
|
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SCHEDULE II
|
LOCK-BOX BANKS, LOCK-BOXES AND LOCK-BOX ACCOUNTS
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SCHEDULE III
|
ACTIONS AND PROCEEDINGS
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SCHEDULE IV
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PURCHASER GROUPS AND MAXIMUM COMMITMENTS
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SCHEDULE V
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PAYMENT INSTRUCTIONS
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SCHEDULE VI
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EXCLUDED OBLIGORS
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ANNEX A
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FORMS OF INFORMATION PACKAGE
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ANNEX B
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FORM OF PURCHASE NOTICE
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ANNEX C
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FORM OF PAYDOWN NOTICE
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ANNEX D
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FORM OF COMPLIANCE CERTIFICATE
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ANNEX E
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FORM OF LETTER OF CREDIT APPLICATION
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ANNEX F
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FORM OF TRANSFER SUPPLEMENT
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This RECEIVABLES PURCHASE AGREEMENT (as amended, restated, supplemented or otherwise modified from time to time, this “
Agreement
”) is entered into as of June 18, 2012 by and among ARVINMERITOR RECEIVABLES CORPORATION, a Delaware corporation, as seller (the “
Seller
”), MERITOR, INC., an Indiana corporation (“
Meritor
”), as initial servicer (in such capacity, together with its successors and permitted assigns in such capacity, the “
Servicer
”), the various CONDUIT PURCHASERS, RELATED COMMITTED PURCHASERS, LC PARTICIPANTS and PURCHASER AGENTS from time to time party hereto, PNC BANK, NATIONAL ASSOCIATION, a national banking association (“
PNC
”), as issuer of Letters of Credit (in such capacity, together with its successors and assigns in such capacity, the “
LC Bank
”) and as administrator (in such capacity, together with its successors and assigns in such capacity, the “
Administrator
”).
PRELIMINARY STATEMENTS. Certain terms that are capitalized and used throughout this Agreement are defined in
Exhibit I
. References in the Exhibits hereto to the “Agreement” refer to this Agreement, as amended, supplemented or otherwise modified from time to time.
The Seller (i) desires to sell, transfer and assign an undivided percentage interest in a pool of receivables, and the Purchasers desire to acquire such undivided percentage interest, as such percentage interest shall be adjusted from time to time based upon, in part, reinvestment payments that are made by such Purchasers and (ii) may, subject to the terms and conditions hereof, request that the LC Bank issue or cause the issuance of one or more Letters of Credit.
In consideration of the mutual agreements, provisions and covenants contained herein, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1
Purchase Facility
.
(a)
On the terms and subject to the conditions hereof, the Seller may, from time to time before the Facility Termination Date, (i) request that (x) the Conduit Purchasers ratably (based on the aggregate Commitments of the Related Committed Purchasers in their respective Purchaser Groups) make purchases (and deemed purchases) of and reinvestments in, or (y) only if a Conduit Purchaser denies such request or is unable to fund (and provides notice of such denial or inability to the Seller, the Administrator and its Purchaser Agent), the Related Committed Purchasers ratably (based on their respective Commitments) make purchases (and deemed purchases) of and reinvestments in, undivided percentage ownership interests with regard to the Purchased Interest from the Seller and (ii) request that the LC Bank issue or cause the issuance of Letters of Credit, in each case subject to the terms hereof (each such purchase, deemed purchase, reinvestment or issuance is referred to herein as a “
Purchase
”). Subject to
Section 1.4(b)
concerning reinvestments, at no time will a Conduit Purchaser have any obligation to make a Purchase. Each Related Committed Purchaser severally hereby agrees, on the terms and subject to the conditions hereof, to make purchases of and reinvestments in undivided percentage ownership interests with regard to the Purchased Interest from the Seller from time to time from the Closing Date to the Facility Termination Date, based on the applicable Purchaser Group’s Ratable Share of each Purchase requested pursuant to
Section 1.2(a)
(and, in the case of each Related Committed Purchaser, its Commitment Percentage of its Purchaser Group’s Ratable Share of such Purchase) and, on the terms of and subject to the conditions of this Agreement, the LC Bank hereby agrees to issue Letters of Credit in return for (and each LC Participant hereby severally agrees to make Participation Advances in connection with any draws under such Letters of Credit equal to such LC Participant’s Pro Rata Share of such draws), undivided percentage ownership interests with regard to the Purchased Interest from the Seller from time to time from the Closing Date to the Facility Termination Date. Notwithstanding anything set forth in this
paragraph (a)
or otherwise herein to the contrary, under no circumstances shall any Purchaser make any purchase or reinvestment (including, without limitation, any Purchases deemed to have been requested by Seller pursuant
to Section 1.1(b)
) or issue any Letters of Credit hereunder, as applicable, if, after giving effect to such Purchase:
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(i)
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any event has occurred and is continuing, or would result from such Purchase, issuance or reinvestment, that constitutes a Termination Event or an Unmatured Termination Event;
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(ii)
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the aggregate outstanding Capital of such Purchaser, when added to all other Capital of all other Purchasers in such Purchaser’s Purchaser Group would exceed (A) its Purchaser Group’s Group Commitment
minus
(B) the related LC Participant’s Pro Rata Share of the LC Participation Amount;
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(iii)
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the Aggregate Capital
plus
the LC Participation Amount would exceed the Purchase Limit; or
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(iv)
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the LC Participation Amount would exceed the aggregate of the Commitments of the LC Participants.
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(v)
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the Purchased Interest would exceed 100%.
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The Seller may, subject to this
paragraph (a)
and the other requirements and conditions herein, use the proceeds of any purchase by the Purchasers hereunder to satisfy its Reimbursement Obligation to the LC Bank and the LC Participants (ratably, based on the outstanding amounts funded by the LC Bank and each such LC Participant) pursuant to
Section 1.14
below.
(b)
In the event the Seller fails to reimburse the LC Bank for the full amount of any drawing under any Letter of Credit on the applicable Drawing Date (out of its own funds available therefor) pursuant to
Section 1.14(b)
, then the Seller shall, automatically (and without the requirement of any further action on the part of any Person hereunder), be deemed to have requested a new purchase from the Conduit Purchasers (and if any Conduit Purchaser is unable or unwilling to fund, the applicable Related Committed Purchaser), on such date, on the terms and subject to the conditions hereof, in an amount equal to the amount of such Reimbursement Obligation at such time. Subject to the limitations on funding set forth in
paragraph (a)
above (and the other requirements and conditions herein), the Conduit Purchasers or Related Committed Purchasers, as applicable, shall fund such deemed purchase request and deliver the proceeds thereof directly to the Administrator to be immediately distributed (ratably) to the LC Bank and the applicable LC Participants in satisfaction of the Seller’s Reimbursement Obligation pursuant to
Section 1.14(b)
, below, to the extent of the amounts permitted to be funded by the Conduit Purchasers or Related Committed Purchasers, as applicable, at such time, hereunder.
(c)
The Seller may, upon at least 60 days’ written notice to the Administrator (except as otherwise provided below), terminate the Purchase Facility in whole or, upon at least 30 days’ written notice to the Administrator, from time to time, irrevocably reduce in part the unused portion of the Purchase Limit (but not below the amount that would cause the Aggregate Capital
plus
the LC Participation Amount to exceed the Purchase Limit or would cause the Group Capital of any Purchaser Group to exceed its Group Commitment, in each case after giving effect to such reduction);
provided
, that each partial reduction shall be in the amount of at least $5,000,000, or an integral multiple of $1,000,000 in excess thereof, and that, unless terminated in whole, the Purchase Limit shall in no event be reduced below $50,000,000. In connection with each such reduction of the Purchase Limit, the Commitment of each Purchaser and the Group Commitment of each Purchaser Group shall automatically be ratably reduced by a proportionate amount. The Seller may terminate the Purchase Facility in whole upon two (2) Business Days’ written notice to the Administrator in the event that (i) the covenant of Meritor to maintain its Priority Debt Ratio as set forth in the Meritor Credit Agreement is amended or modified in any respect (including by amendment or modification of the definition of such term, or any component defined term), (ii) Seller requests that the covenant in
Section 2(n)
of
Exhibit IV
to this Agreement be amended or modified to conform to the Meritor Credit Agreement, effective as of the date of the corresponding amendment or modification of the Meritor Credit Agreement, and (iii) such an amendment or modification is not effected within a reasonable time. The Administrator shall promptly advise the Purchaser Agents of any notice received by it pursuant to this
Section 1.1(c)
. In addition to and without limiting any other requirements for termination, prepayment and/or the funding of the LC Collateral Account hereunder, no such termination or reduction shall be effective unless and until (i) in the case of a termination of the Purchase Facility in whole, the amount on deposit in the LC Collateral Account is at least equal to the then outstanding LC Participation Amount and (ii) in the case of a partial reduction, the amount on deposit in the LC Collateral Account is at least equal to the positive difference between the then outstanding LC Participation Amount and the Purchase Limit as so reduced by such partial reduction.
Section 1.2
Making Purchases.
(a)
Seller may request a purchase (but not reinvestment) of undivided percentage ownership interests with regard to the Purchased Interest hereunder to be made in cash on any day upon the Seller’s irrevocable written notice in the form of
Annex B
(each, a “
Purchase Notice
”) delivered to the Administrator and each Purchaser Agent in accordance with
Section 5.2
, which notice must be received by the Administrator and each Purchaser Agent before 1:00 p.m. New York timeat least one Business Daybefore the requested Purchase Date (or, solely in the case of a purchase in an aggregate amount not exceeding $20,000,000, before 11:00 a.m. New York time on the requested Purchase Date), and which notice shall specify, (A) the amount requested to be paid to the Seller (such amount, which shall not be less than $1,000,000 (or such lesser amount as agreed to by the Administrator and each Purchaser Agent) and shall be in integral multiples of $100,000 in excess thereof, being the Capital relating to the undivided percentage ownership interest then being purchased with respect to each Purchaser Group), (B) the date of such purchase (which shall be a Business Day), and (C) the pro forma calculation of the Purchased Interest after giving effect to the increase in the Aggregate Capital resulting from such purchase.
(b)
On the date of each purchase requested by Seller pursuant to
Section 1.2(a),
each applicable Conduit Purchaser or Related Committed Purchaser, as the case may be, shall, upon satisfaction of the applicable conditions set forth in
Exhibit II
, make available to the Seller in same day funds, at the Purchase Account (or such other account as may be designated in writing by the Seller to the Administrator and each Purchaser Agent), an amount equal to the portion of Capital relating to the undivided percentage ownership interest then being purchased by such Purchaser.
(c)
Effective on the date of each Purchase pursuant to this Agreement, the Seller hereby sells and assigns to the Administrator for the benefit of the Purchasers (ratably, based on the Aggregate Capital
plus
the LC Participation Amount outstanding at such time for each such Purchaser’s Capital) an undivided percentage ownership interest, in: (i) each Pool Receivable then existing, (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.
(d)
To secure all of the Seller’s obligations (monetary or otherwise) 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 “
Obligations
”), the Seller hereby grants to the Administrator (for the benefit of the Purchasers, the Purchaser Agents and their respective assigns) a security interest in all of the Seller’s right, title and interest (including any undivided interest of the Seller) in, to and under all of the following, whether now or hereafter owned, existing or arising: (i) all Pool Receivables, (ii) all Related Security with respect to such Pool Receivables, (iii) all Collections with respect to such Pool Receivables, (iv) the Lock-Box Accounts and all amounts on deposit therein, and all certificates and instruments, if any, from time to time evidencing such Lock-Box Accounts and amounts on deposit therein, (v) all rights (but none of the obligations) of the Seller under the Purchase and Sale Agreement and (vi) all proceeds of, and all amounts received or receivable under any or all of, the foregoing (collectively, the “
Pool Assets
”). The Seller hereby authorizes the Administrator to file financing statements describing the collateral covered thereby as “all of the debtor’s personal property or assets” or words to that effect, notwithstanding that such wording may be broader in scope than the collateral described in this Agreement. The Administrator (on behalf of the Purchasers and their assigns) shall have, with respect to the Pool Assets, and in addition to all the other rights and remedies available to the Administrator and the Purchasers, all the rights and remedies of a secured party under any applicable UCC.
In the event that an Originator has paid to the Seller the full Outstanding Balance of any Receivable pursuant to, and in accordance with,
Section 3.4
of the Purchase and Sale Agreement and such payment has been applied as a Collection in accordance with
Section 1.4
hereof, such Receivable shall be automatically reconveyed to the Seller and released from the security interest granted to the Administrator hereunder without representation or warranty by the Administrator, any Purchaser Agent or any Purchaser.
(e)
Provided that no Termination Event or Unmatured Termination Event shall have occurred and be continuing, the Seller may request the extension of the Scheduled Facility Termination Date by providing written notice to the Administrator and each Purchaser Agent;
provided
such request is made not more than 180 days prior to, and not less than 90 days prior to, the then current Scheduled Facility Termination Date. In the event that the Purchasers are all agreeable to such extension, the Administrator shall so notify the Seller and the Servicer in writing (
it being understood
that any Purchaser may accept or decline such a request in its sole and absolute discretion and on such terms as they may elect) not less than 60 days prior to the then current Scheduled Facility Termination Date, and the Seller, the Servicer, the Administrator, the Purchaser Agents and the Purchasers shall enter into such documents as the Administrator, the Purchaser Agents and the Purchasers may deem necessary or appropriate to reflect such extension, and all reasonable costs and expenses incurred by the Purchasers, the Purchaser Agents and the Administrator in connection therewith (including reasonable Attorney Costs) shall be paid by the Seller. In the event any Purchaser declines the request for such extension, such Purchaser (or its Purchaser Agent) shall so notify the Administrator and the Administrator shall so notify the Seller of such determination;
provided
, that the failure of the Administrator to notify the Seller of the determination to decline such extension shall not affect the understanding and agreement that the applicable Purchasers shall be deemed to have refused to grant the requested extension in the event the Administrator fails to affirmatively notify the Seller, in writing, of their agreement to accept the requested extension. If the Facility Termination Date is extended with respect to one or more, but less than all Purchasers, then the Purchase Limit shall be reduced by an amount equal to the Commitment(s) of the Exiting Purchaser(s) and the Commitment Percentages and Commitments shall be appropriately adjusted (after giving effect to any increase to the Maximum Commitment of any Related Committed Purchaser that agrees to increase its Maximum Commitment in connection with such Exiting Purchaser).
(f)
Each Related Committed Purchaser’s and related LC Participant’s obligations hereunder shall be several, such that the failure of any Related Committed Purchaser or related LC Participant to make a payment in connection with any purchase hereunder, or drawing under a Letter of Credit hereunder, as the case may be, shall not relieve any other Related Committed Purchaser or related LC Participant of its obligations hereunder to make payment for any Funded Purchase or such drawing.
Section 1.3
Purchased Interest Computation
.
The Purchased Interest shall be initially computed on the Closing Date. Thereafter, until the Facility Termination Date, the Purchased Interest shall be automatically recomputed (or deemed to be recomputed) on each Business Day other than a Termination Day. From and after the occurrence of any Termination Day, the Purchased Interest shall (until the event(s) giving rise to such Termination Day are satisfied or are waived by the Administrator in accordance with
Section 2.2
) be deemed to be 100%. The Purchased Interest shall become zero on the Final Payout Date.
Section 1.4
Settlement Procedures
.
(a)
The collection of the Pool Receivables shall be administered by the Servicer in accordance with this Agreement. The Seller shall provide to the Servicer on a timely basis all information needed for such administration, including notice of the occurrence of any Termination Day and current computations of the Purchased Interest.
(b)
The Servicer shall, on each day on which Collections of Pool Receivables are received (or deemed received) by the Seller or the Servicer:
(i)
set aside and hold in trust (and shall, at the request of the Administrator, segregate in a separate account approved by the Administrator) for the benefit of the Purchasers, out of such Collections,
first
, an amount equal to the Aggregate Discount accrued through such day for each Portion of Capital and not previously set aside,
second
, an amount equal to the fees set forth in each Fee Letter accrued and unpaid through such day, and
third
, to the extent funds are available therefor, an amount equal to the aggregate of the Purchasers’ Share of the Servicing Fee accrued through such day and not previously set aside;
(ii)
subject to
Section 1.4(f)
, if such day is not a Termination Day, remit to the Seller, ratably, on behalf of the Purchasers, the remainder of such Collections. Such remainder shall, to the extent representing a return of the Aggregate Capital, be automatically reinvested, ratably, according to each Purchaser’s Capital, in Pool Receivables and in the Related Security, Collections and other proceeds with respect thereto;
provided
,
however
, that if, after giving effect to any such reinvestment, (x) the Purchased Interest would exceed 100%, or (y) the Aggregate Capital
plus
the Adjusted LC Participation Amount would exceed the Purchase Limit then in effect, then the Servicer shall not remit such remainder to the Seller or reinvest, but shall set aside and hold in trust for the Administrator (for the benefit of the Purchasers) (and shall, at the request of the Administrator, segregate in a separate account approved by the Administrator) a portion of such Collections that, together with the other Collections set aside pursuant to this paragraph, shall equal the amount necessary to reduce the Purchased Interest to 100% or cause the Aggregate Capital
plus
the Adjusted LC Participation Amount to not exceed such Purchase Limit, as the case may be, (determined as if such Collections set aside had been applied to reduce the Aggregate Capital and/or the Adjusted LC Participation Amount at such time), which amount shall be deposited ratably to each Purchaser Agent’s account (for the benefit of its related Purchasers) for distribution and application on the next Settlement Date in accordance with
Section 1.4(d)
;
provided
,
however
, that in the case of any Purchaser that has provided notice (an “
Exiting Notice
”) to its Purchaser Agent and the Administrator of its refusal, following any request by the Seller to extend the then Scheduled Commitment Termination Date, to extend its Commitment hereunder (an “
Exiting Purchaser
”), then such Purchaser’s ratable share (determined according to outstanding Capital and Pro Rate Share of the Adjusted LC Participation Amount) of Collections shall not be reinvested or remitted to the Seller and shall instead be held in trust for the benefit of such Purchaser and applied in accordance with
clause (iii)
below;
(iii)
if such day is a Termination Day (or any day following the provision of an Exiting Notice), set aside, segregate and hold in trust for the benefit of the Purchasers or Exiting Purchasers, as applicable, (and shall, at the request of the Administrator, segregate in a separate account approved by the Administrator), the entire remainder of such Collections (or in the case of a day following the provision of an Exiting Notice that is not also a Termination Day, an amount equal to the Exiting Purchasers’ ratable share of such Collections based on their respective Capital;
provided
,
however
, that solely for purposes of determining such Exiting Purchasers’ ratable share of such Collections, such Exiting Purchasers’ Capital shall be deemed to remain constant from the date of the provision of an Exiting Notice until the date such Exiting Purchasers’ Capital has been paid in full;
itbeingunderstood
that if a Termination Day occurs after the provision of such Exiting Notice, such Exiting Purchasers’ Capital shall be recalculated taking into account amounts received by such Exiting Purchasers in respect of this parenthetical and, thereafter, Collections shall be set aside for all Purchasers ratably in respect of their respective Capital (as recalculated)); and
(iv)
release to the Seller (subject to
Section 1.4(f)
) for its own account any Collections in excess of: (w) amounts required to be reinvested in accordance with
clause (ii)plus
(x) the amounts that are required to be set aside pursuant to
clause (i)
above, pursuant to the proviso to
clause (ii)
above and pursuant to
clause (iii)
above,
plus
(y) the Seller’s Share of the Servicing Fee accrued and unpaid through such day and all reasonable and appropriate out-of-pocket costs and expenses of the Servicer for servicing, collecting and administering the Pool Receivables
plus
(z) all other amounts then due and payable by the Seller under this Agreement to the Purchasers, the Purchaser Agents, the Administrator, and any other Indemnified Party or Affected Person.
(c)
The Servicer shall, in accordance with the priorities set forth in
Section 1.4(d)
, deposit into the account specified by each Purchaser Agent on each Settlement Date, Collections held for such Purchaser Agent (for the benefit of its related Purchasers) pursuant to
clause (b)(i)
or
(f)plus
the amount of Collections then held for such Purchaser Agent (for the benefit of its related Purchasers) pursuant to
clauses (b)(ii)
and
(iii)
of
Section 1.4
;
provided
, that if Meritor or an Affiliate thereof is the Servicer, such day is not a Termination Day and the Administrator has not notified Meritor (or such Affiliate) that such right is revoked, Meritor (or such Affiliate) may retain the portion of the Collections set aside pursuant to
clause (b)(i)
that represents the aggregate of each Purchasers’ Share of the Servicing Fee. On or prior to the last day of each Settlement Period, each Purchaser Agent will notify the Servicer telephonically, by electronic mail or by facsimile of the amount of Discount accrued with respect to each Portion of Capital during such related Settlement Period.
(d)
The Servicer shall distribute the amounts described in
clause (c)
above as follows:
(i)
if such distribution occurs on a day that is not a Termination Day:
(A)
first
to each Purchaser Agent ratably according to the Discount and Fees accrued during such Settlement Period (for the benefit of the relevant Purchasers within such Purchaser Agent’s Purchaser Group) in payment in full of all such accrued Discount with respect to each Portion of Capital maintained by such Purchasers and all such accrued Fees; it being understood that each Purchaser Agent shall distribute such amounts to the Purchasers within such Purchaser Agent’s Purchaser Group ratably according to Discount and Fees, respectively; and
(B)
second
, if the Servicer has set aside amounts in respect of the Servicing Fee pursuant to
clause (b)(i)
and has not retained such amounts pursuant to
clause (c)
, to the Servicer (payable in arrears on each Settlement Date) in payment in full of the aggregate of the Purchasers’ Share of accrued Servicing Fees so set aside; and
(ii)
if such distribution occurs on a Termination Day:
(A)
first
, if Meritor or an Affiliate thereof is not the Servicer, to the Servicer in payment in full of the Purchasers’ Share of all accrued Servicing Fees;
(B)
second
, to each Purchaser Agent ratably (based on the aggregate accrued and unpaid Discount and Fees payable to all Purchasers at such time) (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group) in payment in full of all accrued Discount with respect to each Portion of Capital funded or maintained by the Purchasers within such Purchaser Agent’s Purchaser Group and all accrued Fees;
(C)
third
, to each Purchaser Agent ratably according to the aggregate of the Capital of each Purchaser in each such Purchaser Agent’s Purchaser Group (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group) in payment in full of each Purchaser’s Capital;
itbeingunderstoodthat
each Purchaser Agent shall distribute the amounts described in the
first
,
second
and
third
clauses of this
Section 1.4(d)(ii)
to the Purchasers within such Purchaser Agent’s Purchaser Group ratably according to Discount, Fees and Capital, respectively;
(D)
fourth
, to the LC Collateral Account for the benefit of the LC Bank and the LC Participants, the amount necessary to cash collateralize the LC Participation Amount until the amount of cash collateral held in suchLC Collateral Account equals 100% of the LC Participation Amount
plus
the amount of all LC Fees (as defined in the Fee Letter) to accrue thereon through the scheduled expiration of the related Letters of Credit;
(E)
fifth
, if the Aggregate Capital and accrued Aggregate Discount with respect to each Portion of Capital for all Purchaser Groups have been reduced to zero, and the aggregate of the Purchasers’ Share of all accrued Servicing Fees payable to the Servicer (if other than Meritor or an Affiliate thereof) have been paid in full, to each Purchaser Agent ratably, based on the amounts payable to each Purchaser in such Purchaser Agent’s Purchaser Group (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group), the Administrator and any other Indemnified Party or Affected Person in payment in full of any other amounts owed thereto by the Seller or the Servicer hereunder, and
(F)
sixth
, to the Servicer (if the Servicer is Meritor or an Affiliate thereof) in payment in full of the aggregate of the Purchasers’ Share of all accrued Servicing Fees.
After the Aggregate Capital, Aggregate Discount, fees payable pursuant to the Fee Letters and Servicing Fees with respect to the Purchased Interest, and any other amounts payable by the Seller and the Servicer to each Purchaser Group, the Administrator or any other Indemnified Party or Affected Person hereunder, have been paid in full, and (on and after a Termination Day) after an amount equal to 100% of the LC Participation Amount is on deposit in the LC Collateral Account, all additional Collections with respect to the Purchased Interest shall be paid to the Seller for its own account.
(e)
For the purposes of this
Section 1.4
:
(i)
if on any day the Outstanding Balance of any Pool Receivable is reduced or adjusted as a result of any defective, rejected or returned goods or services, or any revision, cancellation, allowance, rebate, discount or other adjustment made by the Seller or any Affiliate of the Seller or the Servicer or any Affiliate of the Servicer, or any setoff or dispute between the Seller or any Affiliate of the Seller or the Servicer or any Affiliate of the Servicer and an Obligor, the Seller shall be deemed to have received on such day a Collection of such Pool Receivable in the amount of such reduction or adjustment and (i) prior to the Facility Termination Date, hold any and all such amounts in trust for the benefit of the Purchasers and their assigns and, on the following Settlement Date, apply such amounts in accordance with this
Section 1.4
or (ii) on or after the Facility Termination Date, immediately pay any and all such amounts in respect thereof to a Lock-Box Account for the benefit of the Purchasers and their assigns and for application pursuant to
Section 1.4
;
(ii)
if the representation and warranty in
Section l(j)
of
Exhibit III
is not true on the day such representation and warranty is made or deemed made, or if any of the representations or warranties in
Section3(a)
of
Exhibit III
is not true with respect to any Pool Receivable, the Seller shall be deemed to have received a Collection of such Pool Receivable in full and, shall immediately pay the amount of such deemed Collection to a Lock-Box Account (or as otherwise directed by the Administrator at such time) for the benefit of the Purchasers and their assigns and for application pursuant to
Section 1.4
;
(iii)
except as otherwise required by applicable law or the relevant Contract, all Collections received from an Obligor of any Receivable shall be applied to the Receivables of such Obligor in the order of the age of such Receivables, starting with the oldest such Receivable, unless such Obligor designates its payment for application to specific Receivables; and
(iv)
if and to the extent the Administrator, any Purchaser Agent or any Purchaser 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 by such Person but rather to have been retained by the Seller and, accordingly, such Person 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 Aggregate Capital (but not to commence the liquidation, or reduction to zero, of the entire Aggregate Capital), the Seller may do so as follows:
(i)
the Seller shall give the Administrator, each Purchaser Agent and the Servicer written notice in substantially the form of
Annex C
(each, a “
Paydown Notice
”) at least one Business Dayprior to the date of such reduction, such Paydown Notice shall include, among other things, the amount of such proposed reduction and the proposed date on which such reduction will commence;
(ii)
(A) on the proposed date of the commencement of such reduction and on each day thereafter, the Servicer shall cause Collections not to be reinvested until the amount thereof not so reinvested shall equal the desired amount of reduction or (B) the Seller shall remit to each Purchaser Agent’s account (for the benefit of the related Purchasers in such Purchaser Agent’s Purchaser group), no later than 1:00 p.m. (New York time), in immediately available funds, an amount equal to the desired amount of such reduction together with accrued and unpaid Aggregate Discount, and Aggregate Discount to accrue through the next Settlement Date, with respect to such Aggregate Capital, ratably based on such Purchaser Agent’s Purchasers’ portion of the Aggregate Capital reduced thereby and portion of the related Aggregate Discount; and
(iii)
the Servicer shall hold such Collections in trust for the benefit of the Purchasers ratably (based on their respective Portions of Capital funded thereby) for payment to such Purchaser Agent (for the benefit of the relevant Purchasers in such Purchaser Agent’s Purchaser Group) on the next Settlement Date immediately following the current Settlement Period or such other date approved by the Administrator and each such Purchaser Agent, and the Aggregate Capital (together with the Capital of any related Purchaser) shall be deemed reduced in the amount to be paid to each such Purchaser Agent (on behalf of its related Purchasers) only when in fact finally so paid; and
(iv)
provided
, that the amount of any such reduction shall be not less than $500,000 and shall be an integral multiple of $100,000 in excess thereof.
Section 1.5
Fees
.
The Seller shall pay to the Administrator, Purchaser Agents and Purchasers certain fees in the amounts and on the dates set forth in one or more fee letter agreements, in each case entered into from time to time by and among the Seller, (the Servicer if applicable) and the applicable Purchaser Agent and/or the Administrator (as any such fee letter agreement may be amended, restated, supplemented or otherwise modified from time to time, each, a “
Fee Letter
”).
Section 1.6
Payments and Computations, Etc.
(a)
All amounts to be paid or deposited by the Seller or the Servicer hereunder or under any other Transaction Document shall be made without reduction for offset or counterclaim and shall be paid or deposited no later than noon (New York time)on the day when due in immediately available funds to each account designated by each applicable Purchaser Agent (for the benefit of the Purchasers in such Purchaser Agent’s Purchaser Group) and/or the Administration Account, as applicable. All amounts received after noon (New York time) will be deemed to have been received on the next Business Day. Except as expressly set forth herein (including, without limitation, as set forth in
Sections 1.4(b)(ii)
or
(iii)
with respect to Collections held in trust for Exiting Purchasers), each Purchaser Agent shall distribute the amounts paid to it hereunder for the benefit of the Purchasers in its Purchaser Group to the Purchasers within its Purchaser Group ratably (x) in the case of such amounts paid in respect of Discount and Fees, according to the Discount and Fees payable to such Purchasers and (y) in the case of such amounts paid in respect of Capital (or in respect of any other obligations other than Discount and Fees), according to the outstanding Capital funded by such Purchasers.
(b)
The Seller or the Servicer, as the case may be, shall, to the extent permitted by law, pay interest on any amount not paid or deposited by the Seller or the Servicer, as the case may be, when due hereunder, at an interest rate equal to 2.0% per annum above the Base Rate, payable on demand.
(c)
All computations of interest under
clause (b)
and all computations of Discount, fees and other amounts hereunder shall be made on the basis of a year of 360 (or 365 or 366, as applicable, with respect to Discount or other amounts calculated by reference to the Base Rate (other than pursuant to
clause (c)
of the definition thereof)) 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 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 after the Closing Date the Administrator, any Purchaser Agent, any Purchaser, any Liquidity Provider or any other Program Support Provider or any of their respective Affiliates (each an “
Affected Person
”) reasonably determines that any Change in Law 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 or issue any Letter of Credit related to this Agreement or any related liquidity facility, credit enhancement facility and other commitments of the same type, then, upon demand by such Affected Person or its related Purchaser Agent (with a copy to the Administrator), the Seller shall promptly pay to the related Purchaser Agent, for the account of such Affected Person, from time to time as specified by such Affected Person or its related Purchaser Agent, additional amounts sufficient to compensate such Affected Person for such increased costs 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.
(b)
If due to any Change in Law, there shall be any increase after the Closing Date in the cost (other than Taxes, which shall be governed by
Section 1.10
) to any Affected Person of agreeing to purchase or purchasing, or maintaining the ownership of, the Purchased Interest (or its portion thereof and including, without limitation, funding or maintaining its Capital or issuing or participating in any Letter of Credit), then, upon demand by such Affected Person, the Seller shall promptly pay to such Affected Person, from time to time as specified by such Affected Person, additional amounts sufficient to compensate such Affected Person for such increased costs.
(c)
A certificate of an Affected Person (or its related Purchaser Agent) setting forth the amount or amounts necessary to compensate such Affected Person as specified in
clause (a)
or
(b)
of this Section and delivered to the Seller and the Administrator, shall be conclusive absent manifest error. The Seller shall pay such Affected Person’s related Purchaser Agent (for the account of such Affected Person) the amount shown as due on the first Settlement Date occurring after the Seller’s receipt of such certificate.
(d)
Notwithstanding anything in this
Section 1.7
to the contrary, (i) if any Affected Person fails to give demand for amounts or losses incurred in connection with this
Section 1.7
within one hundred and eighty (180) days after it obtains knowledge that it is subject to increased capital requirements or has incurred other increased costs, such Affected Person shall, with respect to amounts payable pursuant to this
Section 1.7
, only be entitled to payment under this
Section 1.7
for amounts or losses incurred from and after the date one hundred and eighty (180) days prior to the date that such Affected Person does give such demand, and (ii) the Seller shall not be required under this
Section 1.7
to pay to any Affected Person (x) any amount that has been fully and finally paid in cash to such Affected Person pursuant to the other provisions of this Agreement or any other Transaction Document, (y) any amount if the payment of such amount is expressly excluded from the Seller’s payment obligations hereunder by any provision of this Agreement, or (z) any amount, if such amount constitutes Taxes, which shall be governed by
Section 1.10
.
Section 1.8
Requirements of Law
.
(a)
If any Affected Person reasonably determines that any Change in Law:
(i)
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 that are not otherwise included in the determination of the Euro-Rate or the Base Rate hereunder; or
(ii)
does or shall impose on such Affected Person any other condition or requirement;
and the result of any of the foregoing is: (A) 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 percentage ownership interests with regard to, or issuing any Letter of Credit in respect of, the Purchased Interest (or interests therein) or any Portion of Capital, or (B) to reduce any amount receivable hereunder (whether directly or indirectly), then, in any such case, upon demand therefor by such Affected Person, the Seller shall pay to such Affected Person additional amounts necessary to compensate such Affected Person for such additional cost or reduced amount receivable. All such amounts shall be payable as incurred.
(b)
A certificate of an Affected Person (or its related Purchaser Agent) setting forth the amount or amounts necessary to compensate such Affected Person as specified in
clause (a)
of this Section and delivered to the Seller and the Administrator, shall be conclusive absent manifest error. The Seller shall pay such Affected Person’s related Purchaser Agent (for the account of such Affected Person) the amount shown as due on each Settlement Date occurring after the Seller’s receipt of such certificate.
(c)
Notwithstanding anything in this
Section 1.8
to the contrary, (i) if any Affected Person fails to give demand for amounts or losses incurred in connection with this
Section 1.8
within one hundred and eighty (180) days after it obtains knowledge that it has suffered additional costs or reduced amounts receivable, such Affected Person shall, with respect to amounts payable pursuant to this
Section 1.8
, only be entitled to payment under this
Section 1.8
for amounts or losses incurred from and after the date one hundred and eighty (180) days prior to the date that such Affected Person does give such demand, and (ii) the Seller shall not be required under this
Section 1.8
to pay to any Affected Person (x) any amount that has been fully and finally paid in cash to such Affected Person pursuant to the other provisions of this Agreement or any other Transaction Document, (y) any amount if the payment of such amount is expressly excluded from the Seller’s payment obligations hereunder by any provision of this Agreement, or (z) any amount, if such amount constitutes Taxes, which shall be governed by
Section 1.10
.
Section 1.9
Inability to Determine the Euro-Rate
.
(a)
If the Administrator (or any Purchaser Agent) determines on any day (which determination shall be final and conclusive absent manifest error) that, by reason of circumstances affecting the interbank eurodollar market generally, (i) deposits in dollars are not being offered to banks in the interbank eurodollar market for such day, (ii) adequate means do not exist for ascertaining the Euro-Rate for such day or (iii) the Euro-Rate does not accurately reflect the cost to any Purchaser (as determined by such Purchaser or such Purchaser’s Purchaser Agent) of maintaining any Portion of Capital during any Settlement Period (or portion thereof), then the Administrator (or any Purchaser Agent) shall give notice thereof to the Seller. Thereafter, until the Administrator or such Purchaser Agent notifies the Seller that the circumstances giving rise to such suspension no longer exist, (A) no Portion of Capital shall be funded at the Alternate Rate determined by reference to the Euro-Rate, (B) the Discount for any outstanding Portions of Capital then funded at the Alternate Rate determined by reference to the Euro-Rate shall, be converted to the Alternate Rate determined by reference to the Base Rate without reference to
clause (c)
of the definition thereof and (C) the Discount for any outstanding Portions of Capital then funded at the Base Rate determined by reference to the Euro-Rate shall, be converted to the Base Rate determined without reference to
clause (c)
of the definition thereof.
(b)
If, on any day, the Administrator shall have been notified by any Affected Person that such Affected Person has determined (which determination shall be final and conclusive) that, any Change in Law, or compliance by such Affected Person with any Change in Law shall make it unlawful or impossible for such Affected Person to fund or maintain any Portion of Capital at the Alternate Rate and based upon the Euro-Rate, the Administrator shall notify the Seller thereof. Upon receipt of such notice, until the Administrator notifies the Seller that the circumstances giving rise to such determination no longer apply, (A) no Portion of Capital shall be funded at the Alternate Rate determined by reference to the Euro-Rate and (B) the Discount for any outstanding Portions of Capital then funded at the Alternate Rate determined by reference to the Euro-Rate shall be converted to the Alternate Rate determined by reference to the Base Rate either (i) on the last day of the then current Settlement Period (or solely with respect to the Euro-Rate, immediately) if such Affected Person may lawfully continue to maintain such Portion of Capital at the Alternate Rate determined by reference to the Euro-Rate to such day, or (ii) immediately, if such Affected Person may not lawfully continue to maintain such Portion of Capital at the Alternate Rate determined by reference to the Euro-Rate to such day.
Section 1.10
Taxes
.
(a)
Payments Free of Taxes
. Any and all payments by or on account of any obligation of the Seller hereunder shall be made free and clear of and without reduction or withholding for any Indemnified Taxes;
provided
that if the Seller shall be required by Applicable Law to deduct any Indemnified Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions for Indemnified Taxes (including any Other Taxes) (including deductions applicable to additional sums payable under this Section) each Affected Person receives an amount equal to the sum it would have received had no such deductions for Indemnified Taxes (including any Other Taxes) been made, (ii) the Seller shall make such deductions and (iii) the Seller shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with Applicable Law.
(b)
Payment of Other Taxes by the Seller
. Without limiting the provisions of
paragraph (a)
above, the Seller shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.
(c)
Indemnification by the Seller
. The Seller shall indemnify the Administrator, any Purchaser, and any Purchaser Agent within ten (10) Business Days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) described in this
Section 1.10
that are paid by the Administrator, such Purchaser, or such Purchaser Agent, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Seller by the Administrator, such Purchaser, or such Purchaser Agent (with a copy to the Administrator), shall be conclusive absent manifest error.
(d)
Evidence of Payments
. As soon as practicable (but not later than 30 days) after any payment of Indemnified Taxes or Other Taxes by the Seller to a Governmental Authority, the Seller shall deliver to the Administrator and the applicable Affected Person (or its related Purchaser Agent) the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrator and the applicable Purchaser Agent.
(e)
Treatment of Certain Refunds.
If an Affected Person determines, in its sole discretion, that it has received a refund or credit of any Taxes as to which it has been reimbursed or indemnified by the Seller, it shall pay over such refund or credit to the Seller (but only to the extent of indemnity payments made, or additional amounts paid, by the Seller under this
Section 1.10
with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses as such Affected Person and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund net of any applicable Taxes payable in respect of such interest);
provided
that, the Seller upon the request of such Affected Person, agrees to repay the amount paid over to the Seller (plus any penalties, interest, or other charges imposed by the relevant Governmental Authority) to such Affected Person in the event such Affected Person is required to repay such refund to such Governmental Authority. This
Section 1.10
shall not be construed to require any Affected Person to make available its tax returns or any other information relating to its Taxes which it deems confidential) to the Seller or any other Person.
(f)
Exclusions
. Notwithstanding anything in this
Section 1.10
to the contrary, the Seller shall not be required to pay to an Affected Person any amount pursuant to this
Section 1.10
to the extent (i) such amount has been fully and finally paid in cash to such Affected Person pursuant to the other provisions of this Agreement or (ii) the payment of such amount is expressly excluded from the Seller’s payment obligations hereunder by any provision of this Agreement (excluding, for the avoidance of doubt, any provision of this Agreement stating that Taxes are to be governed by this
Section 1.10
).
Section 1.11
Letters of Credit
.
Subject to the terms and conditions hereof, the LC Bank shall issue or cause the issuance of Letters of Credit (“
Letters of Credit
”) on behalf of Seller (and, if applicable, on behalf of, or for the account of, such Originator or an Affiliate of such Originator in favor of such beneficiaries as such Originator or an Affiliate of such Originator may elect with the consent of the Seller);
provided
,
however
, that the LC Bank will not be required to issue or cause to be issued any Letters of Credit to the extent that after giving effect thereto the issuance of such Letters of Credit would then cause (a) the sum of (i) the Aggregate Capital
plus
(ii) the LC Participation Amount to exceed the Purchase Limit or (b) the LC Participation Amount to exceed the aggregate of the Commitments of the LC Participants (other than Defaulting Purchasers). All amounts drawn upon Letters of Credit shall accrue Discount for each day such drawn amounts shall have not been reimbursed.
Section 1.12
Issuance of Letters of Credit; Participations
.
(a)
The Seller may request the LC Bank, upon two Business Days’ prior written notice submitted on or before 1:00 p.m., New York time, to issue a Letter of Credit by delivering to the Administrator, the LC Bank’s form of Letter of Credit Application (the “
Letter of Credit Application
”), substantially in the form of
Annex E
attached hereto and a Purchase Notice, substantially in the form of
Annex B
hereto, in each case completed to the satisfaction of the Administrator and the LC Bank; and, such other certificates, documents and other papers and information as the Administrator or the LC Bank may reasonably request. The Seller also has the right to give instructions and make agreements with respect to any Letter of Credit Application and the disposition of documents, and to agree with the Administrator or the LC Bank upon any amendment, extension or renewal of any Letter of Credit.
(b)
Each Letter of Credit shall, among other things, (i) provide for the payment of sight drafts or other written demands for payment when presented for honor thereunder in accordance with the terms thereof and when accompanied by the documents described therein and (ii) have an expiry date not later than twelve (12) months after such Letter of Credit’s date of issuance, extension or renewal, as the case may be, and in no event later than twelve (12) months after the Facility Termination Date. The terms of each Letter of Credit may include customary “evergreen” provisions providing that such Letter of Credit’s expiry date shall automatically be extended for additional periods not to exceed twelve (12) months unless, not less than thirty (30) days (or such longer period as may be specified in such Letter of Credit) (the “
Notice Date
”) prior to the applicable expiry date, the LC Bank delivers written notice to the beneficiary thereof declining such extension;
provided
,
however
, that if (x) any such extension would cause the expiry date of such Letter of Credit to occur after the date that is twelve (12) months after the Facility Termination Date or (y) the LC Bank determines that any condition precedent (including, without limitation, those set forth in
Section 1.1(a)
or
Exhibit II
) to issuing such Letter of Credit hereunder (as if such Letter of Credit were then being first issued) are not satisfied (other than any such condition requiring the Seller to submit a Purchase Notice or Letter of Credit Application in respect thereof), then the LC Bank, in the case of
clause (x)
above, may (or, at the written direction of any LC Participant, shall) or, in the case of
clause (y)
above, shall, use reasonable efforts in accordance with (and to the extent permitted by) the terms of such Letter of Credit to prevent the extension of such expiry date (including notifying the Seller and the beneficiary of such Letter of Credit in writing prior to the Notice Date that such expiry date will not be so extended). Each Letter of Credit shall be subject either to the Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication No. 600, and any amendments or revisions thereof adhered to by the LC Bank or the International Standby Practices (ISP98-International Chamber of Commerce Publication Number 590), and any amendments or revisions thereof adhered to by the LC Bank, as determined by the LC Bank.
(c)
The Administrator shall promptly notify the LC Bank and each LC Participant, at such Person’s address for notices hereunder, of the request by the Seller for a Letter of Credit hereunder, and shall provide the LC Bank and LC Participants with the Letter of Credit Application and Purchase Notice delivered to the Administrator by the Seller pursuant to
paragraph (a)
, above, by the close of business on the day received or if received on a day that is not a Business Day or on any Business Day after 1:00 p.m., New York time, on such day, on the next Business Day.
(d)
Immediately upon the issuance by the LC Bank of any Letter of Credit (or any amendment to a Letter of Credit increasing the amount thereof), the LC Bank shall be deemed to have sold and transferred to each LC Participant, and each LC Participant shall be deemed irrevocably and unconditionally to have purchased and received from the LC Bank, without recourse or warranty, an undivided interest and participation, to the extent of such LC Participant’s Pro Rata Share, in such Letter of Credit, each drawing made thereunder and the obligations of the Seller hereunder with respect thereto, and any security therefor or guaranty pertaining thereto. Upon any change in the Commitments or Pro Rata Shares of the LC Participants pursuant to this Agreement, it is hereby agreed that, with respect to all outstanding Letters of Credit and unreimbursed drawings thereunder, there shall be an automatic adjustment to the participations pursuant to this
clause (d)
to reflect the new Pro Rata Shares of the assignor and assignee LC Participant or of all LC Participants with Commitments, as the case may be. In the event that the LC Bank makes any payment under any Letter of Credit and the Seller shall not have reimbursed such amount in full to the LC Bank pursuant to
Section 1.14(b)
, each LC Participant shall be obligated to make Participation Advances with respect to such Letter of Credit in accordance with
Section 1.14(c)
.
Section 1.13
Requirements For Issuance of Letters of Credit
.
The Seller shall authorize and direct the LC Bank to name the Seller, an Originator or an Affiliate of an Originator as the “Applicant” or “Account Party” of each Letter of Credit.
Section 1.14
Disbursements, Reimbursement
.
(a)
Immediately upon the issuance of each Letter of Credit, each LC Participant shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the LC Bank a participation in such Letter of Credit and each drawing thereunder in an amount equal to such LC Participant’s Pro Rata Share of the face amount of such Letter of Credit and the amount of such drawing, respectively.
(b)
In the event of any request for a drawing under a Letter of Credit by the beneficiary or transferee thereof, the LC Bank will promptly notify the Administrator and the Seller of such request. Provided that it shall have received such notice, the Seller shall reimburse (such obligation to reimburse the LC Bank shall sometimes be referred to as a “
Reimbursement Obligation
”) the LC Bank prior to noon, New York time, on each date that an amount is paid by the LC Bank under any Letter of Credit (each such date, a “
Drawing Date
”) in an amount equal to the amount so paid by the LC Bank. In the event the Seller fails to reimburse the LC Bank for the full amount of any drawing under any Letter of Credit by noon, New York time, on the Drawing Date (including because the conditions precedent to a Funded Purchase deemed to have been requested by Seller pursuant to
Section 1.1(b)
to reimburse the LC Bank shall not have been satisfied), the LC Bank will promptly notify each LC Participant thereof. Any notice given by the LC Bank pursuant to this Section may be oral if immediately confirmed in writing;
provided
that the lack of such an immediate written confirmation shall not affect the conclusiveness or binding effect of such oral notice.
(c)
Each LC Participant shall upon any notice pursuant to
subclause (b)
above make available to the LC Bank an amount in immediately available funds equal to its Pro Rata Share of the amount of the drawing (a “
Participation Advance
”), whereupon the LC Participants shall each be deemed to have made a Funded Purchase in that amount. If any LC Participant so notified fails to make available to the LC Bank the amount of such LC Participant’s Pro Rata Share of such amount by no later than 2:00 p.m., New York time on the Drawing Date, then interest shall accrue on such LC Participant’s obligation to make such payment, from the Drawing Date to the date on which such LC Participant makes such payment (i) at a rate per annum equal to the Federal Funds Rate during the first three days following the Drawing Date and (ii) at a rate per annum equal to the rate applicable to Capital on and after the fourth day following the Drawing Date. The LC Bank will promptly give notice of the occurrence of the Drawing Date, but failure of the LC Bank to give any such notice on the Drawing Date or in sufficient time to enable any LC Participant to effect such payment on such date shall not relieve such LC Participant from its obligation under this
subclause (c)
, provided that such LC Participant shall not be obligated to pay interest as provided in
subclauses (i)
and
(ii)
above until and commencing from the date of receipt of notice from the LC Bank or the Administrator of a drawing. Each LC Participant’s Commitment shall continue until the last to occur of any of the following events: (A) the LC Bank ceases to be obligated to issue or cause to be issued Letters of Credit hereunder; (B) no Letter of Credit issued hereunder remains outstanding and uncancelled or (C) all Persons (other than the Seller) have been fully reimbursed for all payments made under or relating to Letters of Credit.
Section 1.15
Repayment of Participation Advances
.
(a)
Upon (and only upon) receipt by the LC Bank for its account of immediately available funds from or for the account of the Seller (i) in reimbursement of any payment made by the LC Bank under a Letter of Credit with respect to which any LC Participant has made a Participation Advance to the LC Bank, or (ii) in payment of Discount on the Funded Purchases made or deemed to have been made in connection with any such draw, the LC Bank will pay to each LC Participant, ratably (based on the outstanding drawn amounts funded by each such LC Participant in respect of such Letter of Credit), in the same funds as those received by the LC Bank;
itbeingunderstood
, that the LC Bank shall retain a ratable amount of such funds that were not the subject of any payment in respect of such Letter of Credit by any LC Participant.
(b)
If the LC Bank is required at any time to return to the Seller, or to a trustee, receiver, liquidator, custodian, or any official in any insolvency proceeding, any portion of the payments made by the Seller to the LC Bank pursuant to this Agreement in reimbursement of a payment made under the Letter of Credit or interest or fee thereon, each LC Participant shall, on demand of the LC Bank, forthwith return to the LC Bank the amount of its Pro Rata Share of any amounts so returned by the LC Bank
plus
interest at the Federal Funds Rate, from the date the payment was first made to such LC Participant through, but not including, the date the payment is returned by such LC Participant.
Section 1.16
Documentation
.
The Seller agrees to be bound by the terms of the Letter of Credit Application and by the LC Bank’s interpretations of any Letter of Credit issued for the Seller and by the LC Bank’s written regulations and customary practices relating to letters of credit, though the LC Bank’s interpretation of such regulations and practices may be different from the Seller’s own. In the event of a conflict between the Letter of Credit Application and this Agreement, this Agreement shall govern. It is understood and agreed that, except in the case of gross negligence or willful misconduct by the LC Bank, the LC Bank shall not be liable for any error, negligence and/or mistakes, whether of omission or commission, in following the Seller’s instructions or those contained in the Letters of Credit or any modifications, amendments or supplements thereto.
Section 1.17
Determination to Honor Drawing Request
.
In determining whether to honor any request for drawing under any Letter of Credit by the beneficiary thereof, the LC Bank shall be responsible only to determine that the documents and certificates required to be delivered under such Letter of Credit have been delivered and that they comply on their face with the requirements of such Letter of Credit and that any other drawing condition appearing on the face of such Letter of Credit has been satisfied in the manner so set forth.
Section 1.18
Nature of Participation and Reimbursement Obligations
.
Each LC Participant’s obligation in accordance with this Agreement to make Participation Advances as a result of a drawing under a Letter of Credit, and the obligations of the Seller to reimburse the LC Bank upon a draw under a Letter of Credit, shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this
Article I
under all circumstances, including the following circumstances:
(i)
any set-off, counterclaim, recoupment, defense or other right which such LC Participant may have against the LC Bank, the Administrator, the Purchaser Agents, the Purchasers, the Seller or any other Person for any reason whatsoever;
(ii)
the failure of the Seller or any other Person to comply with the conditions set forth in this Agreement for the making of a purchase, reinvestments, requests for Letters of Credit or otherwise, it being acknowledged that such conditions are not required for the making of Participation Advances hereunder;
(iii)
any lack of validity or enforceability of any Letter of Credit or any set-off, counterclaim, recoupment, defense or other right which Seller, an Originator or any Affiliate thereof on behalf of which a Letter of Credit has been issued may have against the LC Bank, the Administrator, any Purchaser, any Purchaser Agent or any other Person for any reason whatsoever;
(iv)
any claim of breach of warranty that might be made by the Seller, the LC Bank or any LC Participant against the beneficiary of a Letter of Credit, or the existence of any claim, set-off, defense or other right which the Seller, the LC Bank or any LC Participant may have at any time against a beneficiary, any successor beneficiary or any transferee of any Letter of Credit or the proceeds thereof (or any Persons for whom any such transferee may be acting), the LC Bank, any LC Participant, the Administrator, any Purchaser or any Purchaser Agent or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Seller or any Subsidiaries of the Seller or any Affiliates of the Seller and the beneficiary for which any Letter of Credit was procured);
(v)
the lack of power or authority of any signer of, or lack of validity, sufficiency, accuracy, enforceability or genuineness of, any draft, demand, instrument, certificate or other document presented under any Letter of Credit, or any such draft, demand, instrument, certificate or other document proving to be forged, fraudulent, invalid, defective or insufficient in any respect or any statement therein being untrue or inaccurate in any respect, even if the Administrator or the LC Bank has been notified thereof;
(vi)
payment by the LC Bank under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit other than as a result of the gross negligence or willful misconduct of the LC Bank;
(vii)
the solvency of, or any acts or omissions by, any beneficiary of any Letter of Credit, or any other Person having a role in any transaction or obligation relating to a Letter of Credit, or the existence, nature, quality, quantity, condition, value or other characteristic of any property or services relating to a Letter of Credit;
(viii)
any failure by the LC Bank or any of the LC Bank’s Affiliates to issue any Letter of Credit in the form requested by the Seller, unless the LC Bank has received written notice from the Seller of such failure within three Business Days after the LC Bank shall have furnished the Seller a copy of such Letter of Credit and such error is material and no drawing has been made thereon prior to receipt of such notice;
(ix)
any Material Adverse Effect;
(x)
any breach of this Agreement or any Transaction Document by any party thereto;
(xi)
the occurrence or continuance of an Insolvency Proceeding with respect to the Seller, any Originator or any Affiliate thereof;
(xii)
the fact that a Termination Event or an Unmatured Termination Event shall have occurred and be continuing;
(xiii)
the fact that this Agreement or the obligations of Seller or Servicer hereunder shall have been terminated; and
(xiv)
any other circumstance or happening whatsoever, whether or not similar to any of the foregoing.
Section 1.19
Indemnity
.
In addition to other amounts payable hereunder, the Seller hereby agrees to protect, indemnify, pay and save harmless the Administrator, the LC Bank, each LC Participant and any of the LC Bank’s Affiliates that have issued a Letter of Credit from and against any and all claims, demands, liabilities, damages, taxes, penalties, interest, judgments, losses, costs, charges and expenses (including reasonable Attorney Costs) which the Administrator, the LC Bank, any LC Participant or any of their respective Affiliates may incur or be subject to as a consequence, direct or indirect, of the issuance of any Letter of Credit, except to the extent resulting from (a) the gross negligence or willful misconduct of the party to be indemnified as determined by a final non-appealable judgment of a court of competent jurisdiction or (b) the wrongful dishonor by the LC Bank of a proper demand for payment made under any Letter of Credit, except if such dishonor resulted from any act or omission, whether rightful or wrongful, of any present or future de jure or de facto Governmental Authority (all such acts or omissions herein called “
Governmental Acts
”).
Section 1.20
Liability for Acts and Omissions.
As between the Seller, on the one hand, and the Administrator, the LC Bank, the LC Participants, the Purchaser Agents and the Purchasers, on the other, the Seller assumes all risks of the acts and omissions of, or misuse of any Letter of Credit by, the respective beneficiaries of such Letter of Credit. In furtherance and not in limitation of the foregoing, none of the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers shall be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for an issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged (even if the LC Bank or any LC Participant shall have been notified thereof); (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of the Seller against any beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among the Seller and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, electronic mail, cable, telegraph, telex, facsimile or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Administrator, the LC Bank, the LC Participants, the Purchaser Agents and the Purchasers, including any Governmental Acts, and none of the above shall affect or impair, or prevent the vesting of, any of the LC Bank’s rights or powers hereunder. In no event shall the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers or their respective Affiliates, be liable to the Seller or any other Person for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses (including without limitation attorneys’ fees), or for any damages resulting from any change in the value of any property relating to a Letter of Credit.
Without limiting the generality of the foregoing, the Administrator, the LC Bank, the LC Participants, the Purchaser Agents and the Purchasers and each of its Affiliates (i) may rely on any written communication believed in good faith by such Person to have been authorized or given by or on behalf of the applicant for a Letter of Credit; (ii) may honor any presentation if the documents presented appear on their face to comply with the terms and conditions of the relevant Letter of Credit; (iii) may honor a previously dishonored presentation under a Letter of Credit, whether such dishonor was pursuant to a court order, to settle or compromise any claim of wrongful dishonor, or otherwise, and shall be entitled to reimbursement to the same extent as if such presentation had initially been honored, together with any interest paid by the LC Bank or its Affiliates; (iv) may honor any drawing that is payable upon presentation of a statement advising negotiation or payment, upon receipt of such statement (even if such statement indicates that a draft or other document is being delivered separately), and shall not be liable for any failure of any such draft or other document to arrive, or to conform in any way with the relevant Letter of Credit; (v) may pay any paying or negotiating bank claiming that it rightfully honored under the laws or practices of the place where such bank is located; and (vi) may settle or adjust any claim or demand made on the Administrator, the LC Bank, the LC Participants, the Purchaser Agents or the Purchasers or their respective Affiliates, in any way related to any order issued at the applicant’s request to an air carrier, a letter of guarantee or of indemnity issued to a carrier or any similar document (each an “
Order
”) and may honor any drawing in connection with any Letter of Credit that is the subject of such Order, notwithstanding that any drafts or other documents presented in connection with such Letter of Credit fail to conform in any way with such Letter of Credit.
In furtherance and extension and not in limitation of the specific provisions set forth above, any action taken or omitted by the LC Bank under or in connection with any Letter of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good faith and without gross negligence or willful misconduct, as determined by a final non-appealable judgment of a court of competent jurisdiction, shall not put the LC Bank under any resulting liability to the Seller, any LC Participant or any other Person.
Section 1.21
Intended Tax Treatment
.
All parties to this Agreement covenant and agree to treat any Purchase and any drawing on a Letter of Credit under this Agreement as debt for all federal income tax purposes (the “
Intended Tax Treatment
”). All parties to this Agreement agree not to take any position on any tax return inconsistent with the Intended Tax Treatment
Section 1.22
Mitigation of Obligations; Replacement of Purchasers
.
(a)
If any Affected Person requests compensation under
Section 1.7
or
Section 1.8
, or if the Seller is required to pay any additional amount to any Affected Person or any Governmental Authority for the account of any Affected Person pursuant to
Section 1.10
, then such Affected Person or its related Purchaser(s) shall (at the request of the Seller) use reasonable efforts to designate a different office for funding or booking its interests hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Affected Person or Purchaser, as applicable, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to
Section 1.7
,
1.8
or
1.10
, as the case may be, in the future, and (ii) would not subject any such Affected Person or Purchaser to any unreimbursed cost or expense and would not otherwise be disadvantageous to any such Affected Person or Purchaser. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Affected Person and its related Purchaser(s) in connection with any such designation or assignment.
(b)
At any time when there is more than one Purchaser Group, the Seller shall be permitted to replace any Purchaser (and the related Purchaser Group) who has (or whose Liquidity Provider or Program Support Provider has) requested compensation under
Section 1.7
or
Section 1.8
, or has give notice under
Section 1.9(b)
, or if the Seller is required to pay any additional amount to such Purchaser, or its Purchaser Agent or any Governmental Authority for the account of such Purchaser pursuant to
Section 1.10
;
provided,however
, that the Seller shall be permitted to replace (i) the Purchaser Group of which the Administrator is a member, or (ii) any Purchaser which is administered by the Administrator or an Affiliate thereof only if, in either case, the Administrator is also replaced contemporaneously, pursuant to documents reasonable satisfactory to the Administrator;
provided
that (i) the replacement financial institution shall purchase, at par, all Capital, Discount and other amounts owing to such replaced Purchaser on or prior to the date of replacement, (ii) the replacement financial institution, if not already a member of an existing Purchaser Group, shall be reasonably satisfactory to the Administrator and the LC Bank, (iii) until such time as replacement shall be consummated, the Seller shall pay all additional amounts requested under
Section 1.7
,
1.8
, or
1.10
, subject to the terms of this Agreement, and (iv) any such replacement shall not be deemed to be a waiver of any right that the Seller, the Administrator, any Purchaser Agent or any other Purchaser shall have against the replaced Purchaser or any member of its Purchaser Group. No Purchaser or Purchaser Group may be replaced pursuant to this
clause (b)
at any time when there is only one Purchaser Group.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
Section 2.1
Representations and Warranties; Covenants
.
Each of the Seller and the Servicer hereby makes the representations and warranties, and hereby agrees to perform and observe the covenants, applicable to it as set forth in
Exhibits III
and
IV
, respectively.
Section 2.2
Termination Events
.
If any of the Termination Events set forth in
Exhibit V
shall occur and while it is continuing, the Administrator may (with the consent of the Majority Purchaser Agents) and shall (at the direction of the Majority Purchaser Agents), by notice to the Seller, declare the Facility Termination Date to have occurred (in which case the Facility Termination Date shall be deemed to have occurred);
provided
, that automatically upon the occurrence of any event (without any requirement for the passage of time or the giving of notice) described in
paragraph (e)
of
Exhibit V
, the Facility Termination Date shall occur. Upon any such declaration, occurrence or deemed occurrence of the Facility Termination Date, the Purchasers, the Purchaser Agents and the Administrator shall have, in addition to the rights and remedies that they may have under this Agreement, all other rights and remedies provided to secured parties after default under the UCC and under other applicable law, which rights and remedies shall be cumulative.
ARTICLE III.
INDEMNIFICATION
Section 3.1
Indemnities by the Seller
.
Without limiting any other rights that the Administrator, the Purchasers, the Purchaser Agents, the Liquidity Providers, any Program Support Provider or any of their respective Affiliates, employees, officers, directors, agents, counsel, successors, transferees or permitted 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, costs, losses, liabilities and penalties (including reasonable Attorney Costs) (all of the foregoing being collectively referred to as “
Indemnified Amounts
”) at any time imposed on or incurred by any Indemnified Party arising out of or otherwise relating to any Transaction Document, the transactions contemplated thereby or the acquisition of any portion of the Purchased Interest, or any action taken or omitted by any of the Indemnified Parties (including any action taken by the Administrator as attorney-in-fact for the Seller or any Originator hereunder or under any other Transaction Document) whether arising by reason of the acts to be performed by the Seller hereunder or otherwise, excluding only Indemnified Amounts to the extent: (a) a final non-appealable judgment of a court of competent jurisdiction holds that such Indemnified Amounts resulted from gross negligence or willful misconduct of the Indemnified Party seeking indemnification or (b) due to the credit risk of the Obligor, and for which reimbursement would constitute recourse to any Originator, the Seller or the Servicer for uncollectible Receivables or (c) such Indemnified Amounts include Taxes (which shall be governed by
Section 1.10
);
provided
,
however
, that nothing contained in this sentence shall limit the liability of the Seller or the Servicer or limit the recourse of any Indemnified Party to the Seller or the Servicer for any amounts otherwise specifically provided to be paid by the Seller or the Servicer hereunder. Without limiting the foregoing indemnification, and subject to the exclusions in the preceding sentence, the Seller shall indemnify each Indemnified Party for Indemnified Amounts (including losses in respect of uncollectible Receivables regardless for purposes of these specific matters whether reimbursement therefor would constitute recourse to the Seller or the Servicer, except as set forth in
subclause (viii)
below) 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 as of the date of such calculation, the failure of any information contained in any Information Package to be true and correct, or the failure of any other information provided to any Purchaser or the Administrator with respect to the Receivables or this Agreement to be true and correct;
(ii)
the failure of any representation, warranty or statement made or deemed made by the Seller (or any employee, officer or agent of the Seller) under or in connection with this Agreement, any other Transaction Document, any Information Package or any other information or report delivered by or on behalf of the Seller pursuant hereto to have been true and correct as of the date made or deemed made when made;
(iii)
the failure by the Seller to comply with any applicable law, rule or regulation related to any Receivable or the related Contract or the non-conformity of any Receivable or the related Contract with any such applicable law, rule or regulation;
(iv)
the failure of the Seller to vest and maintain vested in the Administrator (on behalf of the Purchasers) a first priority perfected ownership interest or security interest in the Purchased Interest and the property conveyed hereunder, free and clear of any Adverse Claim;
(v)
any commingling of funds to which the Administrator, any Purchaser Agent or any Purchaser is entitled hereunder with any other funds except as expressly permitted hereunder;
(vi)
the failure to have filed, in accordance with the requirements of this Agreement or any other Transaction Document, financing statements or other similar instruments or documents under the UCC of each applicable jurisdiction or other applicable laws with respect to any Receivables in, or purporting to be in, the Receivables Pool and the other Pool Assets, whether at the time of any Purchase or at any subsequent time;
(vii)
any failure of a Lock-Box Bank to comply with the terms of the applicable Lock-Box Agreement;
(viii)
any dispute, claim, offset or defense (other than discharge in bankruptcy of the Obligor) of the Obligor to the payment of any Receivable (including without limitation a defense based on such Receivable or the related Contract not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim resulting from the sale or lease of goods or the rendering of services related to such Receivable or the furnishing or failure to furnish any such goods or services or other similar claim or defense not arising from the financial inability of any Obligor to pay undisputed indebtedness;
(ix)
any failure of the Seller to perform its duties or obligations in accordance with the provisions of this Agreement or any other Transaction Document to which it is a party;
(x)
any action taken by the Administrator as attorney-in-fact for the Seller or any Originator pursuant to this Agreement or any other Transaction Document;
(xi)
any environmental liability claim or products liability claim or other claim, investigation, litigation or proceeding, arising out of or in connection with merchandise, insurance or services that are the subject of any Contract related to any Receivable;
(xii)
the use of proceeds of purchases or reinvestments or the issuance of any Letter of Credit; or
(xiii)
any reduction in Capital as a result of the distribution of Collections pursuant to
Section 1.4(d)
, if all or a portion of such distributions shall thereafter be rescinded or otherwise must be returned for any reason.
Section 3.2
Indemnities by the Servicer
.
Without limiting any other rights that any Indemnified Party may have hereunder or under applicable law, the Servicer hereby agrees to indemnify each Indemnified Party from and against any and all Indemnified Amounts arising out of or resulting from (whether directly or indirectly): (a) the failure of any information contained in an Information Package to be true and correct, or the failure of any other information provided to any such Indemnified Party by, or on behalf of, the Servicer to be true and correct, (b) the failure of any representation, warranty or statement made or deemed made by the Servicer (or any of its officers) under or in connection with this Agreement or any other Transaction Document to which it is a party to have been true and correct as of the date made or deemed made when made, (c) the failure by the Servicer to comply with any applicable law, rule or regulation with respect to any Pool Receivable or the related Contract, (d) any dispute, claim, offset or defense of the Obligor (other than as a result of discharge in bankruptcy with respect to such Obligor) to the payment of any Receivable in, or purporting to be in, the Receivables Pool resulting from or related to the Servicer’s collection activities with respect to such Receivable, or (e) any failure of the Servicer to perform its duties or obligations in accordance with the provisions hereof or any other Transaction Document to which it is a party.
ARTICLE IV.
ADMINISTRATION AND COLLECTIONS
Section 4.1
Appointment of the Servicer
.
(a)
The servicing, administering and collection of the Pool Receivables shall be conducted by the Person so designated from time to time as the Servicer in accordance with this Section. Until the Administrator gives notice to Meritor in accordance with this Section of the designation of a new Servicer, Meritor is hereby designated as, and hereby agrees to perform the duties and obligations of, the Servicer pursuant to the terms hereof. Upon the occurrence and during the continuation of a Termination Event, the Administrator may (with the consent of the Majority Purchaser Agents) and shall (at the direction of the Majority Purchaser Agents) designate as Servicer any Person (including itself) to succeed Meritor or any successor Servicer, on the condition in each case that any such Person so designated shall agree to perform the duties and obligations of the Servicer pursuant to the terms hereof.
(b)
Upon the designation of a successor Servicer as set forth in
clause (a)
, Meritor agrees that it will terminate its activities as Servicer hereunder in a manner that the Administrator determines will facilitate the transition of the performance of such activities to the new Servicer, and Meritor shall cooperate with and assist such new Servicer. Such cooperation shall include access to and transfer of records (including Contracts) related to Pool Receivables and use by the new Servicer of all licenses, hardware or software necessary or desirable to collect the Pool Receivables and the Related Security.
(c)
Meritor acknowledges that, in making their decision to execute and deliver this Agreement, the Administrator, the Purchaser Agents and the Purchasers have relied on Meritor’s agreement to act as Servicer hereunder. Accordingly, Meritor agrees that it will not voluntarily resign as Servicer without the prior written consent of the Administrator and the Purchasers.
(d)
The Servicer may delegate its duties and obligations hereunder to any subservicer (each a “
Sub-Servicer
”);
provided
, that, in each such delegation: (i) each such Sub-Servicer shall agree in writing to perform the delegated duties and obligations of the Servicer pursuant to the terms hereof, (ii) the Servicer shall remain liable for the performance of the duties and obligations so delegated, (iii) the Seller, the Administrator, the Purchaser Agents and the Purchasers shall have the right to look solely to the Servicer for performance, and (iv) the terms of any agreement with any Sub-Servicer shall provide that the Administrator may terminate such agreement upon the termination of the Servicer hereunder by giving notice of its desire to terminate such agreement to the Servicer (and the Servicer shall provide appropriate notice to each such Sub-Servicer);
provided
,
however
, that if any such delegation is to any Person other than an Originator or another Affiliate of Meritor, the Administrator and the Majority Purchaser Agents shall have consented in writing in advance to such delegation.
Section 4.2
Duties of the Servicer
.
(a)
The Servicer shall take or cause to be taken all such action as may be necessary or advisable to administer and collect each Pool Receivable from time to time, all in accordance with this Agreement and all applicable laws, rules and regulations, with reasonable care and diligence, and in accordance with the Credit and Collection Policy. The Servicer shall set aside, for the accounts of the Seller and the Purchasers, the amount of the Collections to which each is entitled in accordance with
Article I
. The Servicer may, in accordance with the applicable Credit and Collection Policy, take such action, including modifications, waivers or restructurings of Pool Receivables and the related Contracts as the Servicer may determine to be appropriate to maximize Collections thereof or reflect adjustments permitted under the Credit and Collection Policy or required under applicable laws, rules or regulations or the applicable Contract;
provided
,
however
, that for the purposes of this Agreement (i) such action shall not change the number of days such Pool Receivable has remained unpaid from the date of the original due date related to such Pool Receivable, (ii) such action shall not alter the status of such Pool Receivable as a Delinquent Receivable or a Defaulted Receivable under this Agreement or limit the rights of any of the Purchasers, Purchaser Agents or the Administrator under this Agreement or any other Transaction Document and (iii) if a Termination Event has occurred and is continuing and Meritor or an Affiliate thereof is serving as the Servicer, Meritor or such Affiliate may take such action only upon the prior approval of the Administrator. The Seller shall deliver to the Servicer and the Servicer shall hold for the benefit of the Seller and the Administrator (individually and for the benefit of the Purchasers), in accordance with their respective interests, all records and documents (including computer tapes or disks) with respect to each Pool Receivable. Notwithstanding anything to the contrary contained herein, if a Termination Event has occurred and is continuing, the Administrator may direct the Servicer (whether the Servicer is Meritor or any other Person) to commence or settle any legal action to enforce collection of any Pool Receivable that is a Defaulted Receivable or to foreclose upon or repossess, if applicable, any Related Security with respect to any such Defaulted Receivable.
(b)
The Servicer shall, as soon as practicable following actual receipt of collected funds, turn over to the Seller the collections of any indebtedness that is not a Pool Receivable, less, if Meritor or an Affiliate thereof is not the Servicer, all reasonable and appropriate out-of-pocket costs and expenses of such Servicer of servicing, collecting and administering such collections. The Servicer, if other than Meritor or an Affiliate thereof, shall, as soon as practicable upon demand, deliver to the Seller all records in its possession that evidence or relate to any indebtedness that is not a Pool Receivable, and copies of records in its possession that evidence or relate to any indebtedness that is a Pool Receivable.
(c)
The Servicer’s obligations hereunder shall terminate on the Final Payout Date. After such termination, if Meritor or an Affiliate thereof was not the Servicer on the date of such termination, the Servicer shall promptly deliver to the Seller all books, records and related materials that the Seller previously provided to the Servicer, or that have been obtained by the Servicer, in connection with this Agreement.
Section 4.3
Account Arrangements
.
Prior to the Closing Date, the Seller shall have entered into Lock-Box Agreements with all of the Lock-Box Banks and in each case delivered original counterparts thereof to the Administrator. Upon the occurrence of a Termination Event and during the continuance thereof, the Administrator may (and shall, at the direction of the Majority Purchaser Agents) give notice to each Lock-Box Bank, the Seller and the Servicer that the Administrator is exercising its rights under the Lock-Box Agreements to do any or all of the following: (a) to have the exclusive control of the Lock-Box Accounts (and any funds therein) transferred to the Administrator (for the benefit of the Purchasers) and to exercise exclusive dominion and control over the funds deposited therein, (b) to have the proceeds that are sent to the respective Lock-Box Accounts redirected pursuant to the Administrator’s instructions rather than deposited in the applicable Lock-Box Account, and (c) to take any or all other actions permitted under the applicable Lock-Box Agreement. The Seller hereby agrees that if the Administrator at any time takes any action set forth in the preceding sentence, the Administrator shall have exclusive control (for the benefit of the Purchasers) of the proceeds (including Collections) of all Pool Receivables and the Seller hereby further agrees to take any other action that the Administrator may reasonably request to transfer such control. Any proceeds of Pool Receivables received by the Seller or the Servicer thereafter other than through a Lock-Box Account shall be sent immediately to, or as otherwise instructed by, the Administrator. The parties hereto hereby acknowledge that if at any time the Administrator takes control of any Lock-Box Account, the Administrator shall not have any rights to the funds therein in excess of the unpaid amounts due to the Administrator, the Purchaser Agents, the Purchasers, any Indemnified Party, any Affected Person or any other Person hereunder or under any other Transaction Document, and the Administrator shall distribute or cause to be distributed such funds in accordance with
Section 4.2(b)
and
Article I
(in each case as if such funds were held by the Servicer thereunder).
Section 4.4
Enforcement Rights
.
(a)
At any time following the occurrence and during the continuation of a Termination Event and upon notice to the Seller and the Servicer:
(i)
the Administrator may direct the Obligors that payment of all amounts payable under any Pool Receivable is to be made directly to the Administrator or its designee;
(ii)
the Administrator may instruct the Seller or the Servicer to give notice of the Purchasers’ interest in Pool Receivables to each Obligor, which notice shall direct that payments be made directly to the Administrator or its designee (on behalf of the Purchasers), and the Seller or the Servicer, as the case may be, shall give such notice at the expense of the Seller or the Servicer, as the case may be;
provided
, that if the Seller or the Servicer, as the case may be, fails to so notify each Obligor, the Administrator (at the Seller’s or the Servicer’s, as the case may be, expense) may so notify the Obligors; and
(iii)
the Administrator may request the Servicer to, and upon such request the Servicer shall: (A) assemble all of the records necessary or desirable to collect the Pool Receivables and the Related Security, and transfer or license to a successor Servicer the use of all software necessary or desirable to collect the Pool Receivables and the Related Security, and make the same available to the Administrator or its designee (for the benefit of the Purchasers) at a place selected by the Administrator, and (B) segregate all cash, checks and other instruments received by it from time to time constituting Collections in a manner acceptable to the Administrator and, promptly upon receipt, remit all such cash, checks and instruments, duly endorsed or with duly executed instruments of transfer, to the Administrator or its designee.
(b)
The Seller hereby authorizes the Administrator (on behalf of each Purchaser Group), and irrevocably appoints the Administrator as its attorney-in-fact with full power of substitution and with full authority in the place and stead of the Seller, which appointment is coupled with an interest, to take any and all steps in the name of the Seller and on behalf of the Seller necessary or desirable, in the determination of the Administrator, following the occurrence and during the continuation of a Termination Event, to collect any and all amounts or portions thereof due under any and all Pool Assets, including endorsing the name of the Seller on checks and other instruments representing Collections and enforcing such Pool Assets. Notwithstanding anything to the contrary contained in this subsection, none of the powers conferred upon such attorney-in-fact pursuant to the preceding sentence shall subject such attorney-in-fact to any liability if any action taken by it shall prove to be inadequate or invalid, nor shall they confer any obligations upon such attorney-in-fact in any manner whatsoever.
Section 4.5
Responsibilities of the Seller
.
(a)
Anything herein to the contrary notwithstanding, the Seller shall: (i) perform all of its obligations, if any, under the Contracts related to the Pool Receivables to the same extent as if interests in such Pool Receivables had not been transferred hereunder, and the exercise by the Administrator, any Purchaser Agent or any Purchaser of their respective rights hereunder shall not relieve the Seller from such obligations, and (ii) pay when due any taxes, including any sales taxes payable in connection with the Pool Receivables and their creation and satisfaction. None of the Administrator, the Purchaser Agents and the Purchasers shall have any obligation or liability with respect to any Pool Asset, nor shall any of them be obligated to perform any of the obligations of the Seller or any Originator thereunder.
(b)
Meritor hereby irrevocably agrees that if at any time it shall cease to be the Servicer hereunder, it shall act (if the then-current Servicer so requests) as the data-processing agent of the Servicer and, in such capacity, Meritor shall conduct the data-processing functions of the administration of the Receivables and the Collections thereon in substantially the same way that Meritor conducted such data-processing functions while it acted as the Servicer.
Section 4.6
Servicing Fee
.
(a)
Subject to
clause (b)
, the Servicer shall be paid a fee (the “
Servicing Fee
”) equal to 1.00%
per annum
(the “
Servicing Fee Rate
”) of the daily average aggregate Outstanding Balance of the Pool Receivables. The Purchasers’ Share of such fee shall be paid through the distributions contemplated by
Section 1.4(d)
, and the Seller’s Share of such fee shall be paid by the Seller on each Settlement Date.
(b)
If the Servicer ceases to be Meritor or an Affiliate thereof, the servicing fee shall be the greater of: (i) the amount calculated pursuant to
clause (a)
, and (ii) an alternative amount specified by the successor Servicer not to exceed 110% of the aggregate reasonable costs and expenses incurred by such successor Servicer in connection with the performance of its obligations as Servicer.
Section 4.7
Authorization and Action of the Administrator and Purchaser Agents
.
(a)
Each Purchaser and Purchaser Agent hereby accepts the appointment of and irrevocably authorizes the Administrator to take such actions as agent on its behalf and to exercise such powers as are delegated to the Administrator hereby and to exercise such other powers as are reasonably incidental thereto. The Administrator shall hold, in its name, for the benefit of each Purchaser, ratably, the Purchased Interest. The Administrator shall not have any duties other than those expressly set forth herein or any fiduciary relationship with any Purchaser or Purchaser Agent, and no implied obligations or liabilities shall be read into this Agreement, or otherwise exist, against the Administrator. The Administrator does not assume, nor shall it be deemed to have assumed, any obligation to, or relationship of trust or agency with, the Seller or Servicer. Notwithstanding any provision of this Agreement or any other Transaction Document to the contrary, in no event shall the Administrator ever be required to take any action which exposes the Administrator to personal liability or which is contrary to the provisions of this Agreement, any other Transaction Document or applicable law. The appointment and authority of the Administrator hereunder shall terminate on the Final Payout Date.
(b)
Each Purchaser hereby accepts the appointment of the respective institution identified as the Purchaser Agent for such Purchaser’s Purchaser Group on
Schedule IV
hereto or in the Transfer Supplement or other agreement pursuant to which such Purchaser becomes a party hereto, and irrevocably authorizes such Purchaser Agent to take such action on its behalf under the provisions of this Agreement and to exercise such powers and perform such duties as are expressly delegated to such Purchaser Agent by the terms of this Agreement, if any, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, no Purchaser Agent shall have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Purchaser or other Purchaser Agent or the Administrator, and no implied obligations or liabilities shall be read into this Agreement, or otherwise exist, against any Purchaser Agent.
(c)
Except as otherwise specifically provided in this Agreement, the provisions of this
Section 4.7
are solely for the benefit of the Administrator, the Purchaser Agents and the Purchasers, and none of the Seller or the Servicer shall have any rights as a third-party beneficiary or otherwise under any of the provisions of this
Section 4.7
, except that this
Section 4.7
shall not affect any obligations which the Administrator, any Purchaser Agent or any Purchaser may have to the Seller or the Servicer under the other provisions of this Agreement. Furthermore, no Purchaser shall have any rights as a third-party beneficiary or otherwise under any of the provisions hereof in respect of a Purchaser Agent that is not the Purchaser Agent for such Purchaser.
(d)
In performing its functions and duties hereunder, the Administrator shall act solely as the agent of the Purchasers and the Purchaser Agents and does not assume nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for the Seller or Servicer or any of their successors and assigns. In performing its functions and duties hereunder, each Purchaser Agent shall act solely as the agent of its respective Purchasers and does not assume nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for the Seller, the Servicer, any Purchaser not in such Purchaser Agent’s Purchaser Group, any other Purchaser Agent or the Administrator, or any of their respective successors and assigns.
Section 4.8
Nature of Administrator’s Duties; Delegation of Administrator’s Duties; Exculpatory Duties
.
(a)
The Administrator shall have no duties or responsibilities except those expressly set forth in this Agreement or in the other Transaction Documents. The duties of the Administrator shall be mechanical and administrative in nature. At no time shall the Administrator have any duty or responsibility to any Person to investigate or confirm the correctness or accuracy of any information or documents delivered to it in its role as Administrator hereunder or any obligation in respect of the failure of any Person (other than the Administrator) to perform any obligation hereunder or under any other Transaction Document. The Administrator shall not have, by reason of this Agreement, a fiduciary relationship in respect of any Purchaser. Nothing in this Agreement or any of the Transaction Documents, express or implied, is intended to or shall be construed to impose upon the Administrator any obligations in respect of this Agreement or any of the Transaction Documents except as expressly set forth herein or therein. The Administrator shall not have any duty or responsibility, either initially or on a continuing basis, to provide any Purchaser or Purchaser Agent with any credit or other information with respect to the Seller, any Originator, Meritor, any Sub-Servicer or the Servicer, whether coming into its possession before the Closing Date or at any time or times thereafter. If the Administrator seeks the consent or approval of the Purchasers or the Purchaser Agents to the taking or refraining from taking any action hereunder, the Administrator shall send notice thereof to each Purchaser (or such Purchaser’s Purchaser Agent, on its behalf) or each Purchaser Agent, as applicable. The Administrator shall promptly notify each Purchaser Agent any time that the Purchasers and/or Purchaser Agents, as the case may be, have instructed the Administrator to act or refrain from acting pursuant hereto.
(b)
The Administrator may execute any of its duties through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrator shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.
(c)
None of the Administrator and the Purchaser Agent, nor any of their respective directors, officers, agents or employees shall be liable for any action taken or omitted (i) with the consent or at the direction of the Majority Purchaser Agents (or, in the case of any Purchaser Agent, the Purchasers within such Purchaser Agent’s Purchaser Group that have a majority of the aggregate Commitments of such Purchaser Group) or (ii) in the absence of such Person’s gross negligence or willful misconduct. The Administrator shall not be responsible to any Purchaser, Purchaser Agent or other Person for (i) any recitals, representations, warranties or other statements made by the Seller, any Sub-Servicer, the Servicer, Meritor, any Originator or any of their Affiliates, (ii) the value, validity, effectiveness, genuineness, enforceability or sufficiency of any Transaction Document, (iii) any failure of the Seller, any Sub-Servicer, the Servicer, Meritor, any Originator or any of their Affiliates to perform any obligation hereunder or under the other Transaction Documents to which it is a party (or under any Contract), or (iv) the satisfaction of any condition specified in
Exhibit II
. The Administrator shall not have any obligation to any Purchaser Agent or Purchaser to ascertain or inquire about the observance or performance of any agreement contained in any Transaction Document or to inspect the properties, books or records of the Seller, the Servicer, any Originator or any of their respective Affiliates.
Section 4.9
UCC Filings
.
Each of the Seller and the Purchasers expressly recognizes and agrees that the Administrator may be listed as the assignee or secured party of record on the various UCC filings required to be made hereunder in order to perfect the transfer of the Purchased Interest from the Seller to the Purchasers, that such listing shall be for administrative convenience only in creating a record or nominee owner to take certain actions hereunder on behalf of the Purchasers and that such listing will not affect in any way the status of the Purchasers as the beneficial owners of the Purchased Interest. In addition, such listing shall impose no duties on the Administrator other than those expressly and specifically undertaken in accordance with this
Section 4.9
.
Section 4.10
Agent’s Reliance, Etc
.
None of the Administrator and the Purchaser Agents, nor any of their respective directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it as Administrator or as Purchaser Agent, as the case may be, under or in connection with this Agreement except for such Person’s own gross negligence or willful misconduct. Each of the Administrator and each Purchaser Agent: (i) may consult with legal counsel (including counsel for the Seller), independent public accountants and other experts selected by the Administrator and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (ii) makes no warranty or representation to any Purchaser or Purchaser Agent and shall not be responsible to any Purchaser or Purchaser Agent for any statements, warranties or representations made in or in connection with this Agreement; (iii) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of this Agreement on the part of the Seller, the Servicer, any Sub-Servicer, Meritor or any Originator or to inspect the property (including the books and records) of the Seller, the Servicer, any Sub-Servicer, Meritor or any Originator; (iv) shall not be responsible to any Purchaser or Purchaser Agent for the due execution, legality, validity, enforceability, genuineness, sufficiency, or value of this Agreement, or any other instrument or document furnished pursuant hereto; and (v) shall incur no liability under or in respect of this Agreement or any other Transaction Document by acting upon any notice (including notice by telephone), consent, certificate or other instrument or writing (which may be by facsimile) believed by it to be genuine and signed or sent by the proper party or parties. The Administrator may at any time request instructions from the Purchasers and/or Purchaser Agents, and the Purchaser Agents may at any time request instructions from the Purchasers in their Purchaser Groups, with respect to any actions or approvals which by the terms of this Agreement or of any of the other Transaction Documents the Administrator or such Purchaser Agent is permitted or required to take or to grant, and if such instructions are promptly requested, the Administrator and/or such Purchaser Agent shall be absolutely entitled to refrain from taking any action or to withhold any approval and shall not be under any liability whatsoever to any Person for refraining from any action or withholding any approval under any of the Transaction Documents until it shall have received such instructions from the Majority Purchaser Agents, in the case of the Administrator or Purchasers holding the majority of the aggregate of the Commitments in such Purchaser Agent’s Purchaser Group, in the case of any Purchaser Agent (or, in either case, where expressly required hereunder, from the Majority LC Participants, the LC Bank, all of the Purchasers and/or all of the LC Participants). Without limiting the foregoing, (x) none of the Purchasers and the Purchaser Agents shall have any right of action whatsoever against the Administrator as a result of the Administrator acting or refraining from acting under this Agreement or any of the other Transaction Documents in accordance with the instructions of the Majority Purchaser Agent and (y) none of the Purchasers in a Purchaser Agent’s Purchaser Group shall have any right of action whatsoever against such Purchaser Agent as a result of such Purchaser Agent acting or refraining from acting under this Agreement or any of the other Transaction Documents in accordance with the instructions of the Purchasers within such Purchaser Agent’s Purchaser Group with a majority of the Commitments of such Purchaser Group. The Administrator shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement in accordance with a request of the required Purchasers or required Purchaser Agents, and such request and any action taken or failure to act pursuant thereto shall be binding upon all Purchasers, all Purchaser Agents and the Administrator. Each Purchaser Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement in accordance with a request of the Purchasers in such Purchaser Agent’s Purchaser Group with a majority of the Commitments of such Purchaser Group, and any such request and any action taken or failure to act pursuant thereto shall be binding upon all the Purchasers in such Purchaser Agent’s Purchaser Group and such Purchaser Agent.
Section 4.11
Administrator and Affiliates
.
To the extent that the Administrator or any of its Affiliates is or shall become an LC Participant hereunder, the Administrator or such Affiliate, in such capacity, shall have the same rights and powers under this Agreement as would any other LC Participant hereunder and may exercise the same as though it were not the Administrator. The Administrator and its Affiliates may generally engage in any kind of business with the Seller, any Originator, Meritor, any Sub-Servicer or the Servicer, any of their respective Affiliates and any Person who may do business with or own securities of the Seller, any Originator, Meritor, any Sub-Servicer or the Servicer or any of their respective Affiliates, all as if it were not the Administrator hereunder and without any duty to account therefor to any Purchaser Agent, or Purchaser.
Section 4.12
Notice of Termination Events
.
Neither the Administrator nor any Purchaser Agent shall be deemed to have knowledge or notice of the occurrence of any Termination Event or Unmatured Termination Event unless it has received notice from, in the case of the Administrator, any Purchaser Agent, any Purchaser, the Servicer or the Seller and, in the case of any Purchaser Agent, the Administrator, any other Purchaser Agent, any Purchaser, the Servicer or the Seller, in each case stating that a Termination Event or an Unmatured Termination Event has occurred hereunder and describing such Termination Event or Unmatured Termination Event. In the event that the Administrator receives such a notice, it shall promptly give notice thereof to each Purchaser Agent. In the event that a Purchaser Agent receives such a notice, it shall promptly give notice thereof to the Administrator (unless such Purchaser Agent first received notice of such Termination Event or Unmatured Termination Event from the Administrator) and to each of its related Purchasers. The Administrator shall take such action concerning a Termination Event or an Unmatured Termination Event as may be directed by the Majority Purchaser Agents (unless such action otherwise requires the consent of the required Purchasers, all Purchaser Agents or the LC Bank), but until the Administrator receives such directions, the Administrator may (but shall not be obligated to) take such action, or refrain from taking such action, as the Administrator deems advisable and in the best interests of the Purchasers and Purchaser Agents.
Section 4.13
Non-Reliance on Administrator, Purchaser Agents and other Purchasers; Administrators and Affiliates
.
(a)
Each Purchaser and Purchaser Agent expressly acknowledges that none of the Administrator and the Purchaser Agents, in the case of such Purchaser, and none of the Administrator or any other Purchaser Agent, in the case of such Purchaser Agent, nor in either case any of their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrator or any Purchaser Agent hereafter taken, including any review of the affairs of the Seller, Meritor, the Servicer or any Originator, shall be deemed to constitute any representation or warranty by the Administrator or such Purchaser Agent. Each Purchaser and Purchaser Agent represents and warrants to the Administrator and such Purchaser’s Purchaser Agent, in the case of such Purchaser, and Administrator, in the case of such Purchaser Agent, that it has, independently and without reliance upon the Administrator, the LC Bank, any Purchaser Agent or any Purchaser and based on such documents and information as it has deemed appropriate, made and will continue to make its own appraisal of any investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of the Seller, Meritor, the Servicer or the Originators, and made its own evaluation and decision to enter into this Agreement. Except for terms specifically required to be delivered hereunder, the Administrator shall not have any duty or responsibility to provide any Purchaser or Purchaser Agent, and no Purchaser Agent have any duty or responsibility to provide any Purchaser, with any information concerning the Seller, Meritor, the Servicer or the Originators or any of their Affiliates that comes into the possession of the Administrator or such Purchaser Agent, respectively, or any of their respective officers, directors, employees, agents, attorneys-in-fact or Affiliates.
(b)
Each of the Purchasers, the Purchaser Agents and the Administrator and any of their respective Affiliates may extend credit to, accept deposits from and generally engage in any kind of banking, trust, debt, entity or other business with the Seller, Meritor, the Servicer or any Originator or any of their Affiliates. With respect to the acquisition of the Eligible Receivables pursuant to this Agreement, each of the Purchaser Agents and the Administrator shall have the same rights and powers under this Agreement as any Purchaser and may exercise the same as though it were not such an agent, and the terms “Purchaser” and “Purchasers” shall include, to the extent applicable, each of the Purchaser Agents and the Administrator in their individual capacities.
Section 4.14
Indemnification
.
Each LC Participant and Related Committed Purchaser agrees to indemnify and hold harmless the Administrator and its officers, directors, employees, representatives and agents and the LC Bank (to the extent not reimbursed by the Seller, the Servicer or any Originator and without limiting the obligation of the Seller, the Servicer, or any Originator to do so), ratably according to its Pro Rata Share, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, settlements, costs, expenses and, or disbursements of any kind or nature whatsoever (including, in connection with any investigative or threatened proceeding, whether or not the Administrator, the LC Bank or such Person shall be designated a party thereto) that may at any time be imposed on, incurred by, or asserted against the Administrator, LC Bank or such Person as a result of, or related to, any of the transactions contemplated by the Transaction Documents or the execution, delivery or performance of the Transaction Documents or any other document furnished in connection therewith;
provided
,
however
, that no LC Participant or Related Committed Purchaser shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses, or disbursements resulting from the Administrator’s or the LC Bank’s gross negligence or willful misconduct, as determined by a final non-appealable judgment of a court of competent jurisdiction. Without limiting the generality of the foregoing, each LC Participant agrees to reimburse the Administrator and the LC Bank, ratably according to their Pro Rata Shares, promptly upon demand, for any out-of-pocket expenses (including reasonable Attorney Costs) incurred by the Administrator or the LC Bank in connection with the administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of its rights or responsibilities under, this Agreement.
Section 4.15
Successor Administrator
.
The Administrator may, upon at least thirty (30) days’ notice to the Seller, the Purchaser Agents and the Servicer, resign as Administrator. Such resignation shall not become effective until a successor Administrator is appointed by the Majority Purchaser Agents and the LC Bank and has accepted such appointment. Upon such acceptance of its appointment as Administrator hereunder by a successor Administrator, such successor Administrator shall succeed to and become vested with all the rights and duties of the retiring Administrator, and the retiring Administrator shall be discharged from its duties and obligations under the Transaction Documents. After any retiring Administrator’s resignation hereunder, the provisions of
Sections 3.1
and
3.2
and this
Article IV
shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrator.
ARTICLE V.
MISCELLANEOUS
Section 5.1
Amendments, Etc.
No amendment or waiver of any provision of this Agreement or any other Transaction Document, or consent to any departure by the Seller or the Servicer therefrom, shall be effective unless in a writing signed by the Administrator, the Majority Purchaser Agents, the LC Bank and, in the case of an amendment, by the other parties thereto;
provided
,
however
, that no such amendment shall, (a) without the consent of each affected Purchaser, (i) extend the date of any payment or deposit of Collections by the Seller or the Servicer or decrease the outstanding amount of or rate of Discount or extend the repayment of or any scheduled payment date for the payment of any Discount in respect of any Portion of Capital or any fees owed to a Purchaser; (ii) reduce any fees payable pursuant to the applicable Fee Letter, (iii) forgive or waive or otherwise excuse any repayment of Capital or change either the amount of Capital of any Purchaser or any Purchaser’s pro rata share of the Purchased Interest; (iv) increase the Commitment of any Purchaser; (v) amend or modify the Pro Rata Share of any LC Participant; (vi) amend or modify the provisions of this
Section 5.1
or the definition of “Capital”, “Eligible Receivables”, “Majority LC Participants”, “Majority Purchaser Agents”, “Net Receivables Pool Balance”, “Purchased Interest”, “Scheduled Commitment Termination Date” (other than pursuant to an extension thereof in accordance with
Article I
hereof), “Termination Day” or “Total Reserves” or (vii) amend or modify any defined term (or any term used directly or indirectly in such defined term) used in
clauses (i)
through
(vi)
above in a manner that would circumvent the intention of the restrictions set forth in such clauses and (b) without the consent of the Majority Purchaser Agents and/or Majority LC Participants, as applicable, amend, waive or modify any provision expressly requiring the consent of such Majority Purchaser Agents and/or Majority LC Participant. Each such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given. No failure on the part of any Purchaser Agent, any Purchaser or the Administrator 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 5.2
Notices, Etc.
All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing (including facsimile or electronic mail communication) and shall be personally delivered or sent by facsimile, or by overnight mail, to the intended party at the mailing address or facsimile number of such party set forth under its name on the signature pages hereof (or in any other document or agreement pursuant to which it is or became a party hereto), or at such other address or facsimile number as shall be designated by such party in a written notice to the other parties hereto. All such notices and communications shall be effective (i) if delivered by overnight mail, when received, and (ii) if transmitted by facsimile or electronic mail, when sent, receipt confirmed by telephone or electronic means.
Section 5.3
Successors and Assigns; Assignability; Participations.
(a)
Successors and Assigns
. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and assigns of such party; all covenants, promises and agreements by or on behalf of any parties hereto that are contained in this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns. Except as otherwise provided in
Section 4.1(d)
, neither the Seller nor the Servicer may assign or transfer any of its rights or delegate any of its duties hereunder or under any Transaction Document without the prior written consent of the Administrator, each Purchaser Agent and the LC Bank.
(b)
Participations
. Except as otherwise specifically provided herein, any Purchaser may sell to one or more Persons (each a “
Participant
”) participating interests in the interests of such Purchaser hereunder;
provided
, that no Purchaser shall grant any participation under which the Participant shall have rights to approve any amendment to or waiver of this Agreement or any other Transaction Document. Such Purchaser shall remain solely responsible for performing its obligations hereunder, and the Seller, the Servicer, each Purchaser Agent and the Administrator shall continue to deal solely and directly with such Purchaser in connection with such Purchaser’s rights and obligations hereunder. A Purchaser shall not agree with a Participant to restrict such Purchaser’s right to agree to any amendment, waiver or modification hereto.
(c)
Assignments by Related Committed Purchasers
. Any Related Committed Purchaser may, with the prior written consent of the Seller (which the Seller may grant or withhold in its sole discretion) assign to one or more Persons (each a “
Purchasing Related Committed Purchaser
”), acceptable to each of the Administrator, the LC Bank and the related Purchaser Agent, in each such Person’s sole discretion, its rights and obligations herein (including its Commitment(which shall be inclusive of its Commitment as an LC Participant)) in whole or in part, pursuant to a supplement hereto, substantially in the form of
Annex G
with any changes as have been approved by the parties thereto (each, a “
Transfer Supplement
”), executed by each such Purchasing Related Committed Purchaser, such selling Related Committed Purchaser, such related Purchaser Agent and the Administrator;
provided
, that the consent of the Seller shall not be required if (i) a Termination Event has occurred and is continuing or (ii) such assignment is made by any Related Committed Purchaser to (A) the Administrator, (B) any other Related Committed Purchaser, (C) any Affiliate of the Administrator or any Related Committed Purchaser, (D) any commercial paper conduit or similar financing vehicle sponsored or administered by such Purchaser and for whom such Purchaser acts as a program support provider or through which (directly or indirectly) such Purchaser does or may fund Purchases hereunder, (E) any Liquidity Provider, (F) any Program Support Provideror (G) any Person that (1) is in the business of issuing commercial paper notes and (2) is associated with or administered by the Administrator or such Related Committed Purchaser or any Affiliate of the Administrator or such Related Committed Purchaser). Upon (i) the execution of the Transfer Supplement, (ii) delivery of an executed copy thereof to the Seller, the Servicer, such related Purchaser Agent and the Administrator and (iii) payment by the Purchasing Related Committed Purchaser to the selling Related Committed Purchaser of the agreed purchase price, if any, such selling Related Committed Purchaser shall be released from its obligations hereunder to the extent of such assignment and such Purchasing Related Committed Purchaser shall for all purposes be a Related Committed Purchaser party hereto and shall have all the rights and obligations of a Related Committed Purchaser hereunder to the same extent as if it were an original party hereto. The amount of the Commitment of the selling Related Committed Purchaser allocable to such Purchasing Related Committed Purchaser shall be equal to the amount of the Commitment of the selling Related Committed Purchaser transferred regardless of the purchase price, if any, paid therefor. The Transfer Supplement shall be an amendment hereof only to the extent necessary to reflect the addition of such Purchasing Related Committed Purchaser as a “Related Committed Purchaser” and a related “LC Participant” and any resulting adjustment of the selling Related Committed Purchaser’s Commitment and, if applicable, selling related LC Participant’s Pro Rata Share of the LC Participation Amount.
(d)
Assignments to Liquidity Providers and other Program Support Providers
. Any Conduit Purchaser may at any time grant to one or more of its Liquidity Providers or other Program Support Providers participating interests in its portion of the Purchased Interest. In the event of any such grant by such Conduit Purchaser of a participating interest to a Liquidity Provider or other Program Support Provider, such Conduit Purchaser shall remain responsible for the performance of its obligations hereunder. The Seller agrees that each Liquidity Provider and Program Support Provider shall be entitled to the benefits of
Sections 1.7
and
1.8
.
(e)
Other Assignment by Conduit Purchasers
. Each party hereto agrees and consents (i) to any Conduit Purchaser’s assignment, participation, grant of security interests in or other transfers of any portion of, or any of its beneficial interest in, the Purchased Interest (or portion thereof), including without limitation to any collateral agent in connection with its commercial paper program and (ii) to the complete assignment by any Conduit Purchaser of all of its rights and obligations hereunder to any Liquidity Provider or Related Committed Purchaser for such Conduit Purchaser or to any other Person;
provided
, that such Conduit Purchaser may not, without the prior consent of its Related Committed Purchasers and, so long as no Termination Event is continuing, of the Seller (which consent the Seller may grant or withhold in its sole discretion), make any such assignment of its rights hereunder unless the assignee (x) is a commercial paper conduit that (i) is principally engaged in the purchase of assets similar to the assets being purchased hereunder, (ii) has as its Purchaser Agent the Purchaser Agent of the assigning Conduit Purchaser and (iii) issues commercial paper or other Notes with credit ratings substantially comparable to the ratings of the assigning Conduit Purchaser or (y) is a Related Committed Purchaser or Liquidity Provider for such Conduit Purchaser. Any assigning Conduit Purchaser shall deliver to any assignee a Transfer Supplement with any changes as have been approved by the parties thereto, duly executed by such Conduit Purchaser, assigning any portion of its interest in the Purchased Interest to its assignee. Such Conduit Purchaser shall promptly (i) notify each of the other parties hereto of such assignment and (ii) take all further action that the assignee reasonably requests in order to evidence the assignee’s right, title and interest in such interest in the Purchased Interest and to enable the assignee to exercise or enforce any rights of such Conduit Purchaser hereunder. Upon the assignment of any portion of its interest in the Purchased Interest, the assignee shall have all of the rights hereunder with respect to such interest (except that the Discount therefor shall thereafter accrue at the rate, determined with respect to the assigning Conduit Purchaser unless the Seller, the related Purchaser Agent and the assignee shall have agreed upon a different Discount).
(f)
Certain Pledges
. Without limiting the right of any Purchaser to sell or grant interests, security interests or participations to any Person as otherwise described in this
Article V
, above, any Purchaser may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure its obligations as a Purchaser hereunder, including any pledge or assignment to secure obligations to a Federal Reserve Bank;
provided
that no such pledge or assignment shall release such Purchaser from any of its obligations hereunder or substitute any such pledge or assignee for such Purchaser as a party hereto.
(g)
Assignment by Administrator
. 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;
provided
, that unless: (i) such assignment is to an Affiliate of PNC, (ii) it becomes unlawful for PNC to serve as the Administrator or (iii) a Termination Event has occurred and is continuing, the Seller has given prior written consent to such assignment, which consent the Seller may grant or withhold in its sole discretion.
(h)
Agents
. Without limiting any other rights that may be available under applicable law, the rights of the Purchasers and each Liquidity Provider may be enforced through it or by its agents.
(i)
Disclosure; Notice
. Each assignor may, in connection with an assignment permitted hereunder, disclose to the applicable assignee (that shall have agreed to be bound by
Section 5.6
) any information relating to the Servicer, the Seller or the Pool Receivables furnished to such assignor by or on behalf of the Servicer, the Seller, any Purchaser, any Purchaser Agent or the Administrator. Such assignor shall give prior written notice to Seller of any assignment of such assignor’s rights and obligations (including ownership of the Purchased Interest) to any Person other than a Program Support Provider.
Section 5.4
Costs and Expenses
.
Without limiting any of the Seller’s other obligations hereunder or under any other Transaction Document (including, without limitation, its obligations under
Sections 1.5
,
1.7
,
1.8
,
1.10
,
1.19
,
3.1
or
Section 1(e)
of
Exhibit IV
of this Agreement), the Seller shall pay to the Administrator, the Purchaser Agents, the Purchasers, the Indemnified Parties and the Affected Persons on demand all their respective costs and expenses in connection with (i) the preparation, negotiation, execution, delivery and administration (including amendments, waivers or renewals of any provision) of this Agreement and the other Transaction Documents, including, without limitation, costs and expenses incurred in connection with the perfection (and continuation) of the Administrator’s rights (on behalf of the Purchasers) in the Receivables, Collections and the other Pool Assets, (ii) without limiting the generality of
clause (i)
above, such Persons’ responses to the occurrence of any Termination Event or Unmatured Termination Event and the enforcement of the obligations of the Seller, the Servicer or the Originators under the Transaction Documents or of any Obligor under a Receivable, (iii) if applicable, the maintenance by the Administrator of the Lock-Box Accounts (and any related Lock-Boxes), including without limitation, following the Administrator’s assumption of exclusive control thereof in accordance with this Agreement and (iv) reasonable Attorney Costs incurred by the Administrator, the Purchaser Agents, the Purchasers, the Indemnified Parties and the Affected Persons in connection with any of the foregoing.
Section 5.5
No Proceedings; Limitation on Payments
.
(a)
Each of the Seller, the Servicer, the Administrator, the LC Bank, the Purchaser Agents and the Purchasers and each assignee of the Purchased Interest or any interest therein, and each Person that enters into a commitment to purchase the Purchased Interest or interests therein, hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, any Conduit Purchaser 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 such Conduit Purchaser is paid in full. The provisions of this paragraph shall survive any termination of this Agreement.
(b)
Each of the Servicer, the Administrator, the LC Bank, the Purchaser Agents and the Purchasers and each assignee of the Purchased Interest or any interest therein, and each Person that enters into a commitment to purchase the Purchased Interest or interests therein, hereby covenants and agrees that it will not institute against, or join any other Person in instituting against, the Seller 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 Final Payout Date;
provided
, that the Administrator may take any such action with the prior written consent of the Majority Purchaser Agents and the LC Bank. The provisions of this paragraph shall survive any termination of this Agreement.
(c)
Notwithstanding any provisions contained in this Agreement to the contrary, no Conduit Purchaser shall, or shall be obligated to, pay any amount, if any, payable by it pursuant to this Agreement or any other Transaction Document unless (i) such Conduit Purchaser has received funds which may be used to make such payment and which funds are not required to repay such Conduit Purchaser’s Notes when due and (ii) after giving effect to such payment, either (x) such Conduit Purchaser could issue Notes to refinance all of its outstanding Notes (assuming such outstanding Notes matured at such time) in accordance with the program documents governing such Conduit Purchaser’s securitization program or (y) all such Conduit Purchaser’s Notes are paid in full. Any amount which a Conduit Purchaser does not pay pursuant to the operation of the preceding sentence shall not constitute a claim (as defined in §101 of the Bankruptcy Code) against or company obligation of such Conduit Purchaser for any such insufficiency unless and until such Conduit Purchaser satisfies the provisions of
clauses (i)
and
(ii)
above. The provisions of this paragraph shall survive any termination of this Agreement.
Section 5.6
Confidentiality
.
Unless otherwise required by applicable law, each of the Seller and the Servicer agrees to maintain the confidentiality of this Agreement and the other Transaction Documents (and all drafts thereof) in communications with third parties and otherwise;
provided
, 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 and each Purchaser Agent, (b) to the Seller’s legal counsel, financial advisors and auditors if they agree to hold it confidential, subject to applicable law, (c) in connection with any legal proceeding arising out of or in connection with this Agreement or any other Transaction Document or the preservation or maintenance of that party’s rights hereunder or thereunder, (d) if required to do so by a court of competent jurisdiction whether in pursuance of any procedure for discovering documents or otherwise, (e) pursuant to any law in accordance with which that party is required or accustomed to act (including applicable SEC requirements) and (f) to any Governmental Authority having jurisdiction over the Seller or the Servicer. The restrictions in the preceding sentence shall not apply to disclosures to any party to this Agreement by any other party hereto, information already known to a recipient otherwise than in breach of this Section, information also received from another source on terms not requiring it to be kept confidential, or information that is or becomes publicly available otherwise than in breach of this Section. Unless otherwise required by applicable law, each of the Administrator, the Purchaser Agents and the Purchasers agrees to maintain the confidentiality of non-public financial information regarding Meritor, the Seller and the Originators;
provided
, that such information may be disclosed to: (i) third parties to the extent such disclosure is made pursuant to a written agreement of confidentiality in form and substance reasonably satisfactory to Meritor, (ii) legal counsel and auditors of the Purchasers, the Purchaser Agents or the Administrator if they agree to hold it confidential, (iii) any nationally recognized statistical rating organization, (iv) any Program Support Provider or potential Program Support Provider (if they agree to hold it confidential), and (v) any placement agency placing the Notes and (vi) any Governmental Authority having jurisdiction over the Administrator, any Purchaser Agent, any Purchaser, any Program Support Provider or any Liquidity Provider.
Section 5.7
GOVERNING LAW AND JURISDICTION
.
(a)
THIS AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK) EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF A SECURITY INTEREST OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
(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 OF THE PARTIES HERETO CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PARTIES 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, THAT 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. EACH OF THE PARTIES HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH SERVICE MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
Section 5.8
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 5.9
Survival of Termination
.
The provisions of
Sections 1.7
,
1.8
,
1.10
,
1.18
,
1.19
,
1.20
,
1.21
,
3.1
,
3.2
,
4.14
,
5.4
,
5.5
,
5.6
,
5.7
,
5.9
,
5.10
and
5.14
shall survive any termination of this Agreement.
Section 5.10
WAIVER OF JURY TRIAL
.
EACH OF THE PARTIES HERETO WAIVES ITS 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. EACH OF THE PARTIES HERETO AGREES 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 THAT 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.
Section 5.11
Entire Agreement
.
This Agreement and the other Transaction Documents embody the entire agreement and understanding between the parties hereto, and supersede all prior or contemporaneous agreements and understandings of such Persons, verbal or written, relating to the subject matter hereof and thereof.
Section 5.12
Headings
.
The captions and headings of this Agreement and any Exhibit, Schedule or Annex hereto are for convenience of reference only and shall not affect the interpretation hereof or thereof.
Section 5.13
Right of Setoff
.
Each Purchaser is hereby authorized (in addition to any other rights it may have) to setoff, appropriate and apply (without presentment, demand, protest or other notice which are hereby expressly waived) any deposits and any other indebtedness held or owing by such Purchaser (including by any branches or agencies of such Purchaser) to, or for the account of, the Seller against amounts owing by the Seller hereunder (even if contingent or unmatured);
provided
that such Purchaser shall notify Seller concurrently with such setoff.
Section 5.14
Purchaser Groups’ Liabilities
.
The obligations of the Administrator, each Purchaser Agent and each Purchaser under the Transaction Documents are solely the corporate obligations of such Person. No recourse shall be had for any obligation or claim arising out of or based upon any Transaction Document against any member, employee, officer, director or incorporator of any such Person.
Section 5.15
Sharing of Recoveries
.
Each Purchaser agrees that if it receives any recovery, through set-off, judicial action or otherwise, on any amount payable or recoverable hereunder in a greater proportion than should have been received hereunder or otherwise inconsistent with the provisions hereof, then the recipient of such recovery shall purchase for cash an interest in amounts owing to the other Purchasers (as return of Capital or otherwise), without representation or warranty except for the representation and warranty that such interest is being sold by each such other Purchaser free and clear of any Adverse Claim created or granted by such other Purchaser, in the amount necessary to create proportional participation by the Purchaser in such recovery. If all or any portion of such amount is thereafter recovered from the recipient, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest.
Section 5.16
USA Patriot Act
.
Each of the Administrator and each of the Purchasers hereby notifies the Seller and the Servicer that pursuant to the requirements of the USA PATRIOT Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the “
PATRIOT Act
”), the Administrator and the Purchasers may be required to obtain, verify and record information that identifies the Seller, the Servicer and the Performance Guarantor, which information includes the name, address, tax identification number and other information regarding the Seller, the Servicer, the Originators and the Performance Guarantor that will allow the Administrator and the Purchasers to identify the Seller, the Servicer, the Originators and the Performance Guarantor in accordance with the PATRIOT Act. This notice is given in accordance with the requirements of the PATRIOT Act. Each of the Seller, Meritor and the Servicer agrees to provide the Administrator and the Purchasers, from time to time, with all documentation and other information required by bank regulatory authorities under “know your customer” and anti-money laundering rules and regulations, including, without limitation, the PATRIOT Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF
, the parties have caused this Agreement to be executed by their respective signatories thereunto duly authorized, as of the date first above written.
ARVINMERITOR RECEIVABLES CORPORATION
,
as Seller
By
/s/ Carl D. Anderson II
Name: Carl D. Anderson II
Title: President and Treasurer
Address: ArvinMeritor Receivables
Corporation
2135 West Maple Road
Troy, MI 48084-7186
Attention: Treasurer
Telephone: 248-435-1588
email: Carl.Anderson@Meritor.com
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
MERITOR, INC.
,
as Initial Servicer
By:
/s/ Carl. D. Anderson II
Name: Carl D. Anderson II
Title: Treasurer
Address: Meritor, Inc.
2135 West Maple Road
Troy, MI 48084-7186
Attention: Treasurer
Telephone: 248-435-1588
email: Carl.Anderson@Meritor.com
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
PNC BANK, NATIONAL ASSOCIATION
,
as a Related Committed Purchaser and
as an LC Participant
By:
/s/ Mark Falcione
Name: Mark Falcione
Title: Senior Vice President
Address: PNC Bank, National Association
Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707
Attention: Mark Falcione
Telephone: 412-762-7325
Facsimile: 412-762-9184
email: mark.falcione@pnc.com /pncconduitgroup@pnc.com
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
PNC BANK, NATIONAL ASSOCIATION
,
as LC Bank
By:
/s/ Mark Falcione
Name: Mark Falcione
Title: Senior Vice President
Address: PNC Bank, National Association
Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707
Attention: Mark Falcione
Telephone: 412-762-7325
Facsimile: 412-762-9184
email: mark.falcione@pnc.com/pncconduitgroup@pnc.com
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
PNC BANK, NATIONAL ASSOCIATION
,
as a Purchaser Agent
By:
/s/ Mark Falcione
Name: Mark Falcione
Title: Senior Vice President
Address: PNC Bank, National Association
Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707
Attention: Mark Falcione
Telephone: 412-762-7325
Facsimile: 412-762-9184
email: mark.falcione@pnc.com/pncconduitgroup@pnc.com
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
PNC BANK, NATIONAL ASSOCIATION
,
as Administrator
By:
/s/ Mark Falcione___________
Name: Mark Falcione
Title: Senior Vice President
Address: PNC Bank, National Association Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707
Attention: Mark Falcione
Telephone: 412-762-5327
Facsimile: 412-762-9184
email: mark.falcione@pnc.com/
pncconduitgroup@pnc.com
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
MARKET STREET FUNDING LLC
,
as a Conduit Purchaser
By:
/s/ Doris J Hearn_____________
Name: Doris J Hearn
Title: Vice President
Address: Market Street Funding LLC
c/o AMACAR Group, LLC
6525 Morrison Blvd. Ste. 318
Charlotte, NC 28211
Attention: Doris Hearn
Telephone: 704-365-0569
Facsimile: 704-365-1362
e-mail: djhearn@amacar.com
With a copy to its Purchaser Agent
701648899 12403015
S
Receivables Purchase Agreement
(Meritor, Inc. / ArvinMeritor Receivables Corporation)
EXHIBIT I
DEFINITIONS
As used in the Agreement (including its Exhibits, Schedules and Annexes), 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.
“
Adjusted LC Participation Amount
” means, at any time, the LC Participation Amount less the amount of cash collateral held in the LC Collateral Account at such time.
“
Administrator
” has the meaning set forth in the preamble to the Agreement.
“
Adverse Claim
” means a lien, security interest or other charge or encumbrance, or any other type of preferential arrangement (including, without limitation, any lien of the Internal Revenue Service or any lien relating to a Pension Plan); it being understood that any thereof in favor of, or assigned to, the Administrator (for the benefit of the Purchasers) shall not constitute an Adverse Claim.
“
Affected Person
” has the meaning set forth in
Section 1.7(a)
of the Agreement.
“
Affiliate
” means, as to any Person: (a) any Person that, directly or indirectly, is in control of, is controlled by or is under common control with such Person, or (b) who is a director or officer: (i) of such Person or (ii) of any Person described in
clause (a)
, except that, in the case of each Conduit Purchaser, Affiliate shall mean the holder(s) of its capital stock or membership interests, as the case may be. For purposes of this definition, control of a Person shall mean the power, direct or indirect: (x) to vote 25% or more of the securities having ordinary voting power for the election of directors or managers of such Person, or (y) to direct or cause the direction of the management and policies of such Person, in either case whether by ownership of securities, contract, proxy or otherwise.
“
Aggregate Capital
” means at any time the aggregate outstanding Capital of all Purchasers at such time.
“
Aggregate Discount
” means, at any time, the sum of the aggregate for each Purchaser of the accrued and unpaid Discount with respect to each such Purchaser’s Capital at such time.
“
Agreement
” has the meaning set forth in the preamble to the Receivables Purchase Agreement to which this
Exhibit I
is attached and made a part.
“
Ally Payoff Agreement
” means that certain letter agreement, between the Seller and Ally Commercial Finance, LLC, providing for the repayment and termination of the credit facility evidenced by that certain Loan and Security Agreement, dated as of September 8, 2009, among the Seller, as borrower, Meritor, the lenders from time to time party thereto and Ally Commercial Finance, LLC, as agent.
“
Alternate Rate
” for any Settlement Period for any Capital (or portion thereof) funded by any Purchaser other than through the issuance of Notes means an interest rate per annum equal to the greater of: (a) the sum of the Applicable Margin
plus
the Euro-Rate for such Settlement Period and (b) the daily average Base Rate for such Settlement Period;
provided
,
however
, that the “Alternate Rate” for any day while a Termination Event has occurred and is continuing shall be an interest rate equal to the Base Rate
plus
2.0% per annum; and
provided
,
further
that
clause (a)
above shall not apply at any time when the Base Rate is applicable to such Settlement Period, Portion of Capital or Purchaser pursuant to
Section 1.9
.
“
Applicable Law
” shall mean all applicable provisions of constitutions, laws, statutes, ordinances, rules, treaties, regulations, permits, licenses, approvals, interpretations and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.
“
Applicable Margin
” has the meaning set forth in the Fee Letter.
“
Attorney Costs
” means and includes all reasonable fees, costs, expenses and disbursements of any law firm or other external counsel and all reasonable disbursements of internal counsel.
“
Bankruptcy Code
” means the United States Bankruptcy Reform Act of 1978 (11 U.S.C. § 101, et seq.), as amended from time to time.
“
Base Rate
” means, for any day and any Purchaser Group, a fluctuating interest rate per annum as shall be in effect from time to time, which rate shall be at all times equal to the highest of:
(a) the rate of interest in effect for such day as publicly announced from time to time by the applicable Purchaser Agent or its Affiliate as its “reference rate” or “prime rate”, as applicable. Such “reference rate” or “prime rate” is set by the applicable Purchaser Agent or its Affiliate based upon various factors, including such Person’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above or below such announced rate, and is not necessarily the lowest rate charged to any customer;
(b) 0.50% per annum above the latest Federal Funds Rate; and
(c) the sum of the Applicable Margin plus the Euro-Rate applicable to the Settlement Period for which the Base Rate is then being determined;
provided
,
however
, that this
clause (c)
shall not apply at any time when the Base Rate is applicable pursuant to
Section 1.9
.
“
Business Day
” means any day (other than a Saturday or Sunday) on which: (a) banks are not authorized or required to close in Troy, MI, New York, NY or Pittsburgh, PA; and (b) if this definition of “Business Day” is utilized in connection with the Euro-Rate, dealings are carried out in the London interbank market.
“
Capital
” means, with respect to any Purchaser, without duplication, the aggregate amounts (i) paid to, or on behalf of, the Seller in connection with all Funded Purchases made by such Purchaser pursuant to
Sections 1.2(b)
and
1.1(b)
of the Agreement, (ii) paid by such Purchaser, as an LC Participant, to the LC Bank in respect of a Participation Advance made by such Purchaser to LC Bank pursuant to
Section 1.14(c)
of the Agreement and (iii) with respect to the Purchaser that is the LC Bank, paid by the LC Bank with respect to all drawings under the Letter of Credit to the extent such drawings have not been reimbursed by the Seller or funded by Participation Advances, as reduced from time to time by Collections distributed and applied on account of such Capital pursuant to
Section 1.4(d)
of the Agreement;
provided
, that if such Capital shall have been reduced by any distribution and thereafter all or a portion of such distribution is rescinded or must otherwise be returned for any reason, such Capital shall be increased by the amount of such rescinded or returned distribution as though it had not been made.
“
Capital Stock
” means, with respect to any Person, any and all common shares, preferred shares, interests, participations, rights in or other equivalents (however designated) of such Person’s capital stock, partnership interests, limited liability company interests, membership interests or other equivalent interests and any rights (other than debt securities convertible into or exchangeable for capital stock), warrants or options exchangeable for or convertible into such capital stock or other equity interests.
“
Change in Control
” means the occurrence of any of the following:
(a) Meritor ceases to own, directly, 100% of the issued and outstanding capital stock and all other equity interests of the Seller free and clear of all Adverse Claims;
(b) Meritor ceases to own, directly or indirectly, 100% of the issued and outstanding capital stock, membership interests or other equity interests of any Originator free and clear of all Adverse Claims; or
(c) with respect to Meritor:
(i) any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act), directly or indirectly, of thirty-five percent (35%) or more of the voting power of the then outstanding capital stock of Meritor entitled to vote generally in the election of the directors of Meritor;
(ii) during any period of twelve (12) consecutive calendar months, the board of directors of Meritor shall cease to have as a majority of its members individuals who either: (i) were directors of Meritor on the first day of such period, or (ii) were elected or nominated for election to the board of directors of Meritor at the recommendation of or other approval by at least a majority of the directors then still in office at the time of such election or nomination who were directors of Meritor on the first day of such period, or whose election or nomination for election was so approved; or
(iii) Meritor consolidates with or merges into another corporation (other than a Subsidiary of Meritor) or conveys, transfers or leases all or substantially all of its property to any person (other than a Subsidiary of Meritor), or any corporation (other than a Subsidiary of Meritor) consolidates with or merges into Meritor, in either event pursuant to a transaction in which the outstanding capital stock of Meritor is reclassified or changed into or exchanged for cash, securities or other property;
provided
, that no pledge of the outstanding capital stock, membership interest or other equity interests of the Seller or any Originator under the Meritor Credit Agreement shall constitute a Change in Control.
“
Change in Law
” means the occurrence, after the Closing Date, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority;
provided
that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
“
Closing Date
” means June 18, 2012.
“
Code
” means the Internal Revenue Code of 1986, as amended, reformed or otherwise modified from time to time.
“
Collections
” means, with respect to any Pool Receivable: (a) all funds that are received by any Originator, the Seller, the Servicer or any other Person in payment of any amounts owed in respect of such Receivable (including purchase price, finance charges, interest and all other charges), or applied to amounts owed in respect of such Receivable (including insurance payments and net proceeds of the sale or other disposition of repossessed goods 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 amounts deemed to have been received pursuant to
Section 1.4(e)
of the Agreement and (c) all other proceeds of such Pool Receivable.
“
Commitment
” means, with respect to any Related Committed Purchaser, LC Participant or LC Bank, as applicable, the maximum aggregate amount which such Purchaser is obligated to pay hereunder on account of all Funded Purchases and all drawings under all Letters of Credit, on a combined basis, as set forth on
Schedule IV
or in the Transfer Supplement or other agreement pursuant to which it became a Purchaser, as such amount may be modified in connection with any subsequent assignment pursuant to
Section 5.3
or in connection with a reduction in the Maximum Purchase Limit pursuant to
Section 1.1(c)
of the Agreement. If the context so requires, “Commitment” also refers to a Purchaser’s obligation to make Purchases, make Participation Advances and/or issue Letters of Credit hereunder.
“
Commitment Percentage
” means, for each Related Committed Purchaser or related LC Participant in a Purchaser Group, the Commitment of such Related Committed Purchaser or related LC Participant, as the case may be,
dividedby
the total of all Commitments of all Related Committed Purchasers or related LC Participants, as the case may be, in such Purchaser Group.
“
Concentration Percentage
” means (a) except as provided in
clause (b)
below, (i) for any Group A Obligor, 15.00%, (ii) for any Group B Obligor, 12.50%, (iii) for any Group C Obligor, 7.50% and (iv) for any Group D Obligor, 5.00% and (b) for each of Oshkosh Corporation and Daimler Trucks North America LLC (each, a “
Special Obligor
”), 20.00% (the “
Special Concentration Limit
”);
provided
,
however
, that the Administrator (with the prior written consent of each Purchaser Agent) may (to the extent the Rating Agency Condition has been satisfied with respect thereto if required by the securitization program of any Conduit Purchaser) approve higher “Concentration Percentages” for selected Obligors;
provided
,
further
, that the Administrator may, upon not less than five (5) Business Days’ notice to Seller, cancel or reduce the Special Concentration Limit with respect to any or all Special Obligors, in which case the Concentration Percentage for such Special Obligor(s) shall be determined pursuant to
clause (a)
above. In the event that any other Obligor is or becomes an Affiliate of a Special Obligor, the Special Concentration Limit shall apply to both such Obligor and such Special Obligor and shall be calculated as if such Obligor and such Special Obligor were a single Obligor.
“
Concentration Reserve
” means, on any date, an amount equal to: (a) the sum of the Aggregate Capital
plus
the Adjusted LC Participation Amount on such date
multipliedby
(b)(i) the Concentration Reserve Percentage on such date,
dividedby
(ii) 100%,
minus
the Concentration Reserve Percentage on such date.
“
Concentration Reserve Percentage
” means, at any time, the largest of: (a) the sum of the four (4) largest Obligor Percentages of the Group D Obligors, (b) the sum of the two (2) largest Obligor Percentages of the Group C Obligors, (c) the largest Obligor Percentage of the Group B Obligors and (d) the largest Obligor Percentage of the Group A Obligors.
“
Conduit Purchaser
” means Market Street Funding LLC and each other commercial paper conduit that is or becomes a party to this Agreement as a “Conduit Purchaser.”
“
Contract
” means, with respect to any Receivable or Excluded Receivable, any and all contracts, instruments, agreements, leases, invoices, notes or other writings pursuant to which such Receivable or Excluded Receivables arises or that evidence such Receivable or Excluded Receivable or under which an Obligor becomes or is obligated to make payment in respect of such Receivable or Excluded Receivable.
“
Controlled Group
” means all members of a controlled group of corporations or other business entities and all trades or businesses (whether or not incorporated) under common control which, together with Meritor or any of its Subsidiaries, are treated as a single employer under Section 414 of the Code.
“
CP Rate
” means, for any Conduit Purchaser and for any Settlement Period for any Portion of Capital (a) the
perannum
rate equivalent to the weighted average cost (as determined by the applicable Purchaser Agent and which shall include commissions of placement agents and dealers, incremental carrying costs incurred with respect to Notes of such Person maturing on dates other than those on which corresponding funds are received by such Conduit Purchaser, other borrowings by such Conduit Purchaser (other than under any Program Support Agreement) and any other costs associated with the issuance of Notes) of or related to the issuance of Notes that are allocated, in whole or in part, by the applicable Conduit Purchaser to fund or maintain such Portion of Capital (and which may be also allocated in part to the funding of other assets of such Conduit Purchaser);
provided
,
however
, that if any component of such rate is a discount rate, in calculating the “
CP Rate
” for such Portion of Capital for such Settlement Period, the applicable Purchaser Agent shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate
perannum
;
provided
,
further
, that notwithstanding anything in this Agreement or the other Transaction Documents to the contrary, the Seller agrees that any amounts payable to Conduit Purchasers in respect of Discount for any Settlement Period with respect to any Portion of Capital funded by such Conduit Purchasers at the CP Rate shall include an amount equal to the portion of the face amount of the outstanding Notes issued to fund or maintain such Portion of Capital that corresponds to the portion of the proceeds of such Notes that was used to pay the interest component of maturing Notes issued to fund or maintain such Portion of Capital, to the extent that such Conduit Purchaser had not received payments of interest in respect of such interest component prior to the maturity date of such maturing Notes (for purposes of the foregoing, the “interest component” of Notes equals the excess of the face amount thereof over the net proceeds received by such Conduit Purchaser from the issuance of Notes, except that if such Notes are issued on an interest-bearing basis its “interest component” will equal the amount of interest accruing on such Notes through maturity) or (b) any other rate designated as the “CP Rate” for such Conduit Purchaser in the Transfer Supplement or other document pursuant to which such Person becomes a party as a Conduit Purchaser to this Agreement, or any other writing or agreement provided by such Conduit Purchaser to the Seller, the Servicer and the applicable Purchaser Agent from time to time. The “CP Rate” for any Conduit Purchaser for any day while a Termination Event has occurred and is continuing shall be an interest rate equal to 2.0% per annum above the Base Rate.
“
Credit and Collection Policy
” means, as the context may require, those receivables credit and collection policies and practices of the Originators in effect on the Closing Date and described in
Schedule I
to the Agreement, as modified in compliance with the Agreement.
“
Days’ Sales Outstanding
” means, for any Fiscal Month, an amount computed as of the last day of such Fiscal Month equal to: (a) the average of the Outstanding Balance of all Pool Receivables as of the last day of each of the three most recent Fiscal Months ended on the last day of such Fiscal Month,
dividedby
(b) (i) the aggregate initial Outstanding Balance of all Pool Receivables originated by the Originators during the three most recent Fiscal Months ended on the last day of such Fiscal Month,
dividedby
(ii) 90.
“
Debt
” means, as to any Person at any time, any and all indebtedness, obligations or liabilities (whether matured or unmatured, liquidated or unliquidated, direct or indirect, absolute or contingent, or joint or several) of such Person for or in respect of: (i) borrowed money, (ii) amounts raised under or liabilities in respect of any note purchase or acceptance credit facility, (iii) reimbursement obligations (contingent or otherwise) under any letter of credit, (iv) any other transaction (including production payments (excluding royalties), installment purchase agreements, forward sale or purchase agreements, capitalized leases and conditional sales agreements) having the commercial effect of a borrowing of money entered into by such Person to finance its operations or capital requirements (but not including accounts payable incurred in the ordinary course of such Person's business payable on terms customary in the trade), or (v) any Guaranty of any such Indebtedness.
“
Default Ratio
” means the ratio (expressed as a percentage and rounded to the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of each Fiscal Month by
dividing
: (a) the aggregate Outstanding Balance of all Pool Receivables that became Defaulted Receivables during such month,
by
(b) the Outstanding Balance of all Pool Receivables generated by the Originators during the month that is three Fiscal Months before such month.
“
Defaulted Receivable
” means a Receivable:
(a) as to which any payment, or part thereof, remains unpaid for more than 60 daysfrom the original due date for such payment, or
(b) (i) as to which an Insolvency Proceeding shall have occurred with respect to the Obligor thereof or any other Person obligated thereon or owning any Related Security with respect thereto or (ii) that has been written off the applicable Originator’s or Seller’s books as uncollectible.
“
Delinquency Ratio
” means the ratio (expressed as a percentage and rounded to the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of each Fiscal Month by dividing: (a) the aggregate Outstanding Balance of all Pool Receivables that were Delinquent Receivables on such day by (b) the aggregate Outstanding Balance of all Pool Receivables on such day.
“
Delinquent Receivable
” means a Receivable as to which any payment, or part thereof, remains unpaid for more than 30 days from the original due for such payment.
“
Dilution Horizon Ratio
” means, for any Fiscal Month, the ratio (expressed as a percentage and rounded to the nearest 1/100th of 1%, with 5/1000th of 1% rounded upward) computed as of the last day of such Fiscal Month of: (a) the sum of (i) the aggregate initial Outstanding Balance of all Pool Receivables generated by the Originators during such Fiscal Month,
plus
(ii) 25.00% of the aggregate initial Outstanding Balance of all Pool Receivables generated by the Originators during the preceding Fiscal Month,
to
(b) the Net Receivables Pool Balance at the last day of such Fiscal Month.
“
Dilution Ratio
” means the ratio (expressed as a percentage and rounded to the nearest 1/100th of 1%, with 5/1000th of 1% rounded upward), computed as of the last day of each Fiscal Month by
dividing
: (a) the aggregate amount deemed to have been received by the Seller pursuant to
Section 1.4(e)(i)
of the Agreement during such Fiscal Month
by
(b) the product of (i) the aggregate initial Outstanding Balance of all Pool Receivables generated by the Originators during the Fiscal Month that is one month prior to such Fiscal Month,
times
(ii) (x) if the Fiscal Month for which such ratio is being calculated is February, May, August or November, 1.00, (y) if the Fiscal Month for which such ratio is being calculated is March, June, September or December, 1.25, or (z) if such ratio is being calculated for any other Fiscal Month, 0.80.
“
Dilution Reserve
” means, on any day, an amount equal to: (a) the Aggregate Capital
plus
the Adjusted LC Participation Amount at the close of business of the Servicer on such day
multipliedby
(b) (i) the Dilution Reserve Percentage on such day,
dividedby
(ii) 100%
minus
the Dilution Reserve Percentage on such day.
“
Dilution Reserve Percentage
” means, on any day, the product of (a) the Dilution Horizon Ratio
multipliedby
(b) the sum of (i) 2.25 times the average of the Dilution Ratios for the twelve most recent Fiscal Monthsand (ii) the Dilution Volatility Component.
“
Dilution Volatility Component
” means, for any Fiscal Month, (a) the positive difference, if any, between: (i) the highest average of the Dilution Ratio for any two consecutive Fiscal Months during the twelve most recent Fiscal Months and (ii) the arithmetic average of the Dilution Ratios for such twelve months
times
(b) (i) the highest average of the Dilution Ratio for any two consecutive Fiscal Months during the twelve most recent Fiscal Months
dividedby
(ii) the arithmetic average of the Dilution Ratios for such twelve months.
“
Discount
” means, with respect to any Purchaser:
(a) for any Portion of Capital for any Settlement Period with respect to any Purchaser to the extent such Portion of Capital will be funded by such Purchaser during such Settlement Period through the issuance of Notes:
CPR x C x ED/360
(b) for any Portion of Capital for any Settlement Period with respect to any Purchaser to the extent such Portion of Capital will not be funded by such Purchaser during such Settlement Period through the issuance of Notes or, if the LC Bank has made, or has deemed to have made, a Funded Purchase in connection with any drawing under a Letter of Credit that has not been reimbursed pursuant to
Section 1.14
of the Agreement:
AR x C x ED/Year
where:
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AR
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= the Alternate Rate for such Portion of Capital for such Settlement Period with respect to such Purchaser,
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C
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= the Portion of Capital during such Settlement Period with respect to such Purchaser,
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CPR
|
= the CP Rate for the Portion of Capital for such Settlement Period with respect to such Purchaser,
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ED
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= the actual number of days during such Settlement Period, and
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Year
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= if such Portion of Capital is funded based upon: (i) the Euro-Rate, 360 days, and (ii) the Base Rate (other than pursuant to
clause (c)
of the definition thereof), 365 or 366 days, as applicable;
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provided
, that no provision of the Agreement shall require the payment or permit the collection of Discount in excess of the maximum permitted by applicable law; and
providedfurther
, that Discount for the 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.
“
Drawing Date
” has the meaning set forth in
Section 1.14
of the Agreement.
“
Eligible Receivable
” means, at any time, a Pool Receivable:
(a) the Obligor of which is: (i) a resident of the United States of America or another country with long-term sovereign debt ratings of at least “A” by Standard & Poor’s and “A2” by Moody’s; (ii) not a government or a governmental subdivision, affiliate or agency; (iii) not subject to any Insolvency Proceeding; (iv) not an Affiliate of Meritor, the Seller, the Servicer or any Originator; and (v) not the Obligor with respect to Delinquent Receivables with an aggregate Outstanding Balance exceeding 50% of the aggregate Outstanding Balance of all such Obligor’s Pool Receivables;
(b) that is denominated and payable only in U.S. dollars in the United States of America, and the Obligor with respect to which has been instructed to remit Collections in respect thereof to a Lock-Box or Lock-Box Account in the United States of America;
(c) that does not have a due date which is more than 180 days after the original invoice date of such Receivable;
(d) that arises under a duly authorized Contract for the sale and delivery of goods or services in the ordinary course of the applicable Originator’s business;
(e) that arises under a duly authorized Contract that is in full force and effect and that is a legal, valid and binding obligation of the related Obligor, enforceable against such Obligor in accordance with its terms;
(f) that conforms in all material respects with all applicable laws, rulings and regulations in effect;
(g) that is not subject to any right of rescission, set-off (including, without limitation, any such right arising from an Obligor making a deposit or similar payment to an Originator), counterclaim, any other defense against the applicable Originator (as its assignee) or Adverse Claim, and the Obligor of which holds no right as against the applicable Originator to cause such Originator to repurchase the goods or merchandise, the sale of which shall have given right to such Receivable;
(h) that satisfies all applicable requirements of the applicable Credit and Collection Policy;
(i) that has not been modified, waived or restructured since its creation, except as permitted pursuant to
Section 4.2
of the Agreement;
(j) in which the Seller owns good and marketable title, free and clear of any Adverse Claims, and that is freely assignable by the Seller (including without any consent of the related Obligor);
(k) for which the Administrator (on behalf of the Purchasers) shall have a valid and enforceable undivided percentage ownership or security interest, to the extent of the Purchased Interest, and a valid and enforceable first priority perfected security interest therein and in the Related Security and Collections with respect thereto, in each case free and clear of any Adverse Claim;
(l) that constitutes an “account” as defined in the UCC, and that is not evidenced by instruments or chattel paper;
(m) that is neither a Defaulted Receivable nor a Delinquent Receivable;
(n) for which none of the Originator thereof, the Seller or the Servicer has established any offset or netting arrangements with the related Obligor in connection with the ordinary course of payment of such Receivable;
(o) that represents amounts earned and payable by the Obligor that are not subject to the performance of additional services by the Originator thereof or by the Seller and such Receivable shall have been billed or invoiced by the Servicer; and
(p) that is not an Existing Navistar Receivable.
“
ERISA
” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and any rule or regulation issued thereunder.
“
Euro-Rate
” means with respect to any Settlement Period the interest rate per annum determined by the Administrator (which determination shall be conclusive absent manifest error) by dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/100th of 1% per annum) (i) the average of the London interbank market offered rates for U.S. dollars quoted by the British Bankers’ Association (“
BBA
”) as set forth on Dow Jones Markets Service display page 3750 (or on any successor or substitute page of such service, or any successor to or substitute for such service, in either case, providing rate quotations comparable to those currently provided on such page of such service, as selected by the Administrator for purposes of providing quotations of interest rates applicable to U.S. dollar deposits in the London interbank market) at or about 11:00 a.m. (London time) on the Business Day which is two (2) Business Days prior to the first day of such Settlement Period for an amount comparable to the Portion of Capital to be funded at the Alternate Rate and based upon the Euro-Rate during such Settlement Period by (ii) a number equal to 1.00
minus
the Euro-Rate Reserve Percentage. The Euro-Rate may also be expressed by the following formula:
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Average of London interbank offered rates quoted by BBA
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as shown on Dow Jones Markets Service display page 3750
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or appropriate successor
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Euro-Rate =
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1.00 - Euro-Rate Reserve Percentage
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where “
Euro-Rate Reserve Percentage
” means, the maximum effective percentage in effect on such day as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the reserve requirements (including without limitation, supplemental, marginal, and emergency reserve requirements) with respect to eurocurrency funding (currently referred to as “
Eurocurrency Liabilities
”). The Euro-Rate shall be adjusted with respect to any Portion of Capital funded at the Alternate Rate and based upon the Euro-Rate that is outstanding on the effective date of any change in the Euro-Rate Reserve Percentage as of such effective date. The Administrator shall give prompt notice to the Seller of the Euro-Rate as determined or adjusted in accordance herewith (which determination shall be conclusive absent manifest error).
“
Excess Concentration
” means, without duplication, the sum of the following amounts:
(a) the sum of the amounts calculated for each of the Obligors equal to the excess (if any) of (i) aggregate Outstanding Balance of the Eligible Receivables of such Obligor,
over
(ii) the product of (x) such Obligor’s Concentration Percentage,
multipliedby
(y) the aggregate Outstanding Balance of all Eligible Receivables;
plus
(b) the amount by which (i) the aggregate Outstanding Balance of all Eligible Receivables, the Obligors of which are residents of countries other than the United States of America,
exceeds
(ii) 8.00% of the aggregate Outstanding Balance of all Eligible Receivables.
“
Excluded Obligor
” means each of the Persons identified on
Schedule VI
to this Agreement, as such Schedule may be amended by the Seller from time to time by written notice to the Administrator identifying one or more other Persons who purchase goods or services from an Originator for use in the business of Volvo or Mack or their Affiliates, and who are "Permitted Obligors," as such term is defined in the Receivables Purchase Agreement, dated as of October 29, 2010, between the Originators, as Sellers, Viking Asset Purchaser No 7 IC, as Initial Purchaser, and the other Persons from time to time parties thereto as purchasers (as amended, modified, supplemented, restated, refinanced, refunded or replaced and in effect from time to time), and specifying the effective date of such designation; provided that if a Person so identified as a Permitted Obligor has been, after the Closing Date, an Obligor of a Pool Receivable, then such designation shall not be effective, and Schedule VI shall not be amended, until the Administrator consents thereto in writing.
“
Excluded Receivable
” means any Receivable (as defined without giving effect to the
proviso
in the definition thereof regarding Excluded Receivables) that (i) is owed to an Originator by an Affiliate of the Originator, (ii) arises from the sale to an Obligor of steel inventory acquired by an Originator solely for the purpose of reselling the steel or other raw materials inventory to such Obligor to be used by such Obligor to manufacture goods for the Originator, (iii) arises from the sale of goods or the provision of services by an Originator to an Excluded Obligor in respect of which an invoice was or is issued for the first time after the later of October 28, 2010, or the effective date of such Person's designation as an Excluded Obligor in accordance with the terms hereof, (iv) arises from the sale of goods or the provision of services by an Originator to Sistemas Automotrices de Mexico S.A. de C.V. in respect of which an invoice is issued for the first time on or after the Closing Date or (v) arises from the sale of goods or the provision of services by an Originator to Navistar, Inc., IC Bus, LLC, SST Truck Company, LLC, or Navistar Diesel of Alabama, LLC in respect of which an invoice is issued for the first time on or after the Closing Date.
“
Excluded Taxes
” shall mean, with respect to the Administrator, a Purchaser, a Purchaser Agent or any other recipient of any payment to be made by or on account of any obligation of the Seller hereunder, taxes imposed on, or measured by, net income or net profits, overall capital or net worth, franchise or branch profits taxes or any similar taxes, and any taxes on doing business imposed by the jurisdiction (i) under the Applicable Laws of which such recipient is incorporated or organized, (ii) in which an applicable office or branch of such recipient is located or (iii) in which such recipient has a present or former connection (other than a connection arising solely from such recipient having executed, delivered, enforced, become a party to, performed its obligations, received payments, received or perfected a security interest under, or engaged in any other transaction in accordance with the terms of this Agreement) that causes the imposition of such tax.
“
Existing Navistar Receivable
” means any Receivable arising from the sale of goods or the provision of services by an Originator to Navistar, Inc., IC Bus, LLC, SST Truck Company, LLC, or Navistar Diesel of Alabama, LLC in respect of which an invoice is issued for the first time prior to the Closing Date.
“
Exiting Notice
” has the meaning set forth in
Section 1.4(b)(ii)
of this Agreement.
“
Exiting Purchaser
” has the meaning set forth in
Section 1.4(b)(ii)
of this Agreement.
“
Facility Termination Date
” means with respect to any Purchaser, the earliest to occur of: (a) the Scheduled Commitment Termination Date with respect to such Purchaser (b) the date determined pursuant to
Section 2.2
of the Agreement, and (c) the date which is 60 days after the date on which the Administrator has received written notice from the Seller of its election to terminate the Purchase Facility pursuant to
Section 1.1(c)
.
“
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. Quotations”) for such day under the caption “Federal Funds Effective Rate.” If on any relevant day the appropriate rate 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 before 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
of the Agreement.
“
Fees
” means the fees payable by the Seller pursuant to the applicable Fee Letter.
“
Final Payout Date
” means the date on or after the Facility Termination Date when (i) the Aggregate Capital and Aggregate Discount have been paid in full, (ii) the LC Participation Amount has been reduced to zero ($0) and no Letters of Credit issued hereunder remain outstanding, (iii) all other amounts owing to the Purchasers, the Purchaser Agents, the Administrator and any other Indemnified Party or Affected Person hereunder and under the other Transaction Documents have been paid in full and (iv) all accrued Servicing Fees have been paid in full.
“
Fiscal Month
” means each calendar month.
“
Fitch
” means Fitch, Inc. and any successor thereto that is a nationally recognized statistical rating organization.
“
Funded Purchase
” shall mean (a) a Purchase that (i) is made pursuant to
Section 1.2(b)
or (ii) deemed to have been requested by Seller pursuant to
Section 1.1(b),
the proceeds of which are used to reimburse the LC Bank on behalf of Seller for a drawing under a Letter of Credit by the Seller and (b) a Participation Advance made by an LC Participant pursuant to
Section 1.14(c)
.
“
Governmental Acts
” has the meaning set forth in
Section 1.19
of the Agreement.
“
Governmental Authority
” means the government of the United States of America or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
“
Group A Obligor
” means any Obligor (or its parent or majority owner, as applicable, if such Obligor is not rated) with a short-term rating of at least: (a) “A-1” by Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a rating of “A+” or better by Standard & Poor’s on such Obligor’s, its parent’s, or its majority owner’s (as applicable) long-term senior unsecured and uncredit-enhanced debt securities,
and
(b) “P‑1” by Moody’s, or if such Obligor does not have a short-term rating from Moody’s, “Al” or better by Moody’s on such Obligor’s, its parent’s or its majority owner’s (as applicable) long-term senior unsecured and uncredit-enhanced debt securities;
provided
, that if an Obligor (or its parent or majority owner, as applicable, if such Obligor is not rated) receives a split rating from Standard & Poor’s and Moody’s, then such Obligor (or its parent or majority owner, as applicable) shall be deemed to have the rating from each of Standard & Poor’s and Moody’s as determined in accordance with the rules of construction found in the final paragraph of this Exhibit I, and such deemed rating shall be used for the purposes of whether such rating satisfies
clauses (a)
and
(b)
above.Notwithstanding the foregoing, any Obligor that is a Subsidiary of an Obligor that satisfies the definition of “Group A Obligor” shall be deemed to be a Group A Obligor and shall be aggregated with the Obligor that satisfies such definition for the purposes of determining the “Concentration Reserve Percentage”, the “Concentration Reserve” and
clause (i)
of the definition of “Excess Concentration” for such Obligors, unless such deemed Obligor separately satisfies the definition of “Group A Obligor”, “Group B Obligor”, or “Group C Obligor”, in which case such Obligor shall be separately treated as a Group A Obligor, a Group B Obligor or a Group C Obligor, as the case may be, and shall be aggregated and combined for such purposes with any of its Subsidiaries that are Obligors.
“
Group B Obligor
” means an Obligor (or its parent or majority owner, as applicable, if such Obligor is not rated) that is not a Group A Obligor, with a short-term rating of at least: (a) “A‑2” by Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a rating of “BBB+” to “A” by Standard & Poor’s on such Obligor’s, its parent’s or its majority owner’s (as applicable) long-term senior unsecured and uncredit-enhanced debt securities,
and
(b) “P‑2” by Moody’s, or if such Obligor does not have a short-term rating from Moody’s, “Baal” to “A2” by Moody’s on such Obligor’s, its parent’s or its majority owner’s (as applicable) long-term senior unsecured and uncredit-enhanced debt securities;
provided
, that if an Obligor (or its parent or majority owner, as applicable, if such Obligor is not rated) receives a split rating from Standard & Poor’s and Moody’s, then such Obligor (or its parent or majority owner, as applicable) shall be deemed to have the rating from each of Standard & Poor’s and Moody’s as determined in accordance with the rules of construction found in the final paragraph of this Exhibit I, and such deemed rating shall be used for the purposes of whether such rating satisfies
clauses (a)
and
(b)
above.Notwithstanding the foregoing, any Obligor that is a Subsidiary of an Obligor that satisfies the definition of “Group B Obligor” shall be deemed to be a Group B Obligor and shall be aggregated with the Obligor that satisfies such definition for the purposes of determining the “Concentration Reserve Percentage”, the “Concentration Reserve” and
clause (i)
of the definition of “Excess Concentration” for such Obligors, unless such deemed Obligor separately satisfies the definition of “Group A Obligor”, “Group B Obligor”, or “Group C Obligor”, in which case such Obligor shall be separately treated as a Group A Obligor, a Group B Obligor or a Group C Obligor, as the case may be, and shall be aggregated and combined for such purposes with any of its Subsidiaries that are Obligors.
“
Group C Obligor
” means an Obligor (or its parent or majority owner, as applicable, if such Obligor is not rated) that is not a Group A Obligor or a Group B Obligor, with a short-term rating of at least: (a) “A‑3” by Standard & Poor’s, or if such Obligor does not have a short-term rating from Standard & Poor’s, a rating of “BBB-” to “BBB” by Standard & Poor’s on such Obligor’s, its parent’s or it’s majority owner’s (as applicable) long-term senior unsecured and uncredit-enhanced debt securities,
and
(b) “P‑3” by Moody’s, or if such Obligor does not have a short-term rating from Moody’s, “Baa3” to “Baa2” by Moody’s on such Obligor’s, its parent’s or its majority owner’s (as applicable) long-term senior unsecured and uncredit-enhanced debt securities;
provided
, that if an Obligor (or its parent or majority owner, as applicable, if such Obligor is not rated) receives a split rating from Standard & Poor’s and Moody’s, then such Obligor (or its parent or majority owner, as applicable) shall be deemed to have the rating from each of Standard & Poor’s and Moody’s as determined in accordance with the rules of construction found in the final paragraph of this Exhibit I, and such deemed rating shall be used for the purposes of whether such rating satisfies
clauses (a)
and
(b)
above.Notwithstanding the foregoing, any Obligor that is a Subsidiary of an Obligor that satisfies the definition of “Group C Obligor” shall be deemed to be a Group C Obligor and shall be aggregated with the Obligor that satisfies such definition for the purposes of determining the “Concentration Reserve Percentage”, the “Concentration Reserve” and
clause (i)
of the definition of “Excess Concentration” for such Obligors, unless such deemed Obligor separately satisfies the definition of “Group A Obligor”, “Group B Obligor”, or “Group C Obligor”, in which case such Obligor shall be separately treated as a Group A Obligor, a Group B Obligor or a Group C Obligor, as the case may be, and shall be aggregated and combined for such purposes with any of its Subsidiaries that are Obligors.
“
Group Capital
” means, with respect to any Purchaser Group, an amount equal to the aggregate outstanding Capital of all Purchasers within such Purchaser Group.
“
Group Commitment
” means, with respect to any Purchaser Group at any time, the aggregate Commitments of all Related Committed Purchasers within such Purchaser Group.
“
Group D Obligor
” means any Obligor that is not a Group A Obligor, Group B Obligor or Group C Obligor;
provided
, that any Obligor (or its parent or majority owner, as applicable, if such Obligor is unrated) that is not rated by both Moody’s and Standard & Poor’s shall be a Group D Obligor.
“
Guaranty
” of any Person means any obligation of such Person guarantying or in effect guarantying any liability or obligation of any other Person in any manner, whether directly or indirectly, including any such liability arising by virtue of partnership agreements, including any agreement to indemnify or hold harmless any other Person, any performance bond or other suretyship arrangement and any other form of assurance against loss, except endorsement of negotiable or other instruments for deposit or collection in the ordinary course of business.
“
Indemnified Amounts
” has the meaning set forth in
Section 3.1
of the Agreement.
“
Indemnified Party
” has the meaning set forth in
Section 3.1
of the Agreement.
“
Indemnified Taxes
” means Taxes other than Excluded Taxes.
“
Independent Director
” has the meaning set forth in
paragraph 3(c)
of
Exhibit IV
to the Agreement.
“
Information Package
” means each Monthly Information Package and each Weekly Information Package.
“
Insolvency Proceeding
” means (a) any case, action or proceeding before any court or other Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors of a Person, composition, marshaling of assets for creditors of a Person, or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors, in each of cases (a) and (b) undertaken under U.S. Federal, state or foreign law, including the Bankruptcy Code.
“
Intended Tax Treatment
” has the meaning set forth in
Section 1.21
.
“
Intercreditor Agreement
” means that certain Intercreditor Agreement, dated as of the Closing Date, among JPMorgan Chase Bank, N.A., the Administrator, Viking Asset Purchaser No 7 and the other Persons from time to time party thereto, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“
LC Bank
” has the meaning set forth in the preamble to the Agreement.
“
LC Collateral Account
” means the account at any time designated as the LC Collateral Account established and maintained by the Administrator (for the benefit of the LC Bank and the LC Participants), or such other account as may be so designated as such by the Administrator.
“
LC Participant
” means each Person listed as such (and its respective Commitment) for each Purchaser Group as set forth on the signature pages of this Agreement or in any Transfer Supplement.
“
LC Participation Amount
” means at any time, the sum of the amounts then available to be drawn under all outstanding Letters of Credit.
“
Letter of Credit
” means any stand-by letter of credit issued by the LC Bank at the request of the Seller pursuant to the Agreement.
“
Letter of Credit Application
” has the meaning set forth in
Section 1.12
of the Agreement.
“
Liquidity Agent
” means any bank or other financial institution acting as agent for the various Liquidity Providers under each Liquidity Agreement.
“
Liquidity Agreement
” means any agreement entered into in connection with this Agreement pursuant to which a Liquidity Provider agrees to make purchases or advances to, or purchase assets from, any Conduit Purchaser in order to provide liquidity for such Conduit Purchaser’s Purchases.
“
Liquidity Provider
” means each bank or other financial institution that provides liquidity support to any Conduit Purchaser pursuant to the terms of a Liquidity Agreement.
“
Lock-Box
” means each locked postal box with respect to which a Lock-Box Bank who has executed a Lock-Box Agreement pursuant to which it has been granted exclusive access for the purpose of retrieving and processing payments made on the Receivables and which is listed on
Schedule II
(as such schedule may be modified from time to time in connection with the addition or removal of any Lock-Box in accordance with the terms hereof).
“
Lock-Box Account
” means each account listed on
Schedule II
to this Agreement (as such schedule may be modified from time to time in connection with the closing or opening of any Lock-Box Account in accordance with the terms hereof) (in each case, in the name of the Seller) and maintained at a bank or other financial institution acting as a Lock-Box Bank pursuant to a Lock-Box Agreement for the purpose of receiving Collections.
“
Lock-Box Agreement
” means each agreement, in form and substance satisfactory to the Administrator, among the Seller, the Servicer (if applicable), the Administrator and a Lock-Box Bank, governing the terms of the related Lock-Box Accounts, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“
Lock-Box Bank
” means any of the banks or other financial institutions holding one or more Lock-Box Accounts.
“
Loss Horizon Ratio
” means, on any date, the ratio (expressed as a percentage and rounded to the nearest 1/100 of 1%, with 5/1000th of 1% rounded upward) computed by dividing: (a) the sum of (i) the aggregate initial Outstanding Balance of all Pool Receivables generated by the Originators during the two (2) most recent Fiscal Months,
plus
(ii) the product of (x) the aggregate initial Outstanding Balance of all Pool Receivables generated by the Originators during the third most recently ended Fiscal Month,
times
(y) 25.00%,
plus
(iii) the product of (x) the aggregate initial Outstanding Balance of all Pool Receivables generated by the Originators during the fourth most recently ended Fiscal Month,
times
(y) the quotient of (A) the Weighted Average Credit Term Factor,
dividedby
(B) 30,
by
(b) the Net Receivables Pool Balance as of such date.
“
Loss Reserve
” means, on any date, an amount equal to: (a) the sum of the Aggregate Capital
plus
the Adjusted LC Participation Amount at the close of business of the Servicer on such date
multipliedby
(b) (i) the Loss Reserve Percentage on such date
dividedby
(ii) 100%
minus
the Loss Reserve Percentage on such date.
“
Loss Reserve Percentage
” means, on any date, the product of (a) 2.25,
times
(b) the highest average of the Default Ratios for any three consecutive Fiscal Months during the twelve most recent Fiscal Months,
times
(c) the Loss Horizon Ratio.
“
Majority LC Participants
” means, at any time, the LC Participants whose Commitments aggregate more than 50% of the Commitments of all LC Participants at such time.
“
Majority Purchaser Agents
” means, at any time, the Purchaser Agents for the Purchaser Groups with Related Committed Purchasers whose Commitments aggregate more than 50% of the aggregate of all Group Commitments.
“
Material Adverse Effect
” means relative to any Person (
provided
that if no particular Person is specified, “Material Adverse Effect” shall be deemed to be relative to the Seller, the Servicer, Meritor and the Originators, individually and in the aggregate) with respect to any event or circumstance, a material adverse effect on:
(a) the assets, operations, business or financial condition of such Person,
(b) the ability of any such Person to perform its obligations under the Agreement or any other Transaction Document to which it is a party,
(c) the validity or enforceability of the Agreement or any other Transaction Document, or the validity, enforceability or collectibility of any material portion of the Pool Receivables, or
(d) the status, perfection, enforceability or priority of the Administrator’s, any Purchaser’s or the Seller’s interest in the Pool Assets.
“
Material Debt
” means (a) any Debt of the Performance Guarantor or any of its Subsidiaries under the Meritor Credit Agreement and (b) any other Debt of the Performance Guarantor or any of its Subsidiaries that is outstanding in a principal amount of at least $35,000,000 in the aggregate.
“
Material Debt Agreement
” means the Meritor Credit Agreement and any other agreement under which any Material Debt was created or is governed or which provides for the incurrence of Debt in an amount which would constitute Material Debt (whether or not an amount of Debt constituting Material Debt is outstanding thereunder).
“
Meritor
” has the meaning set forth in the preamble to the Agreement.
“
Meritor Credit Agreement
” means (a) the Amended and Restated Credit Agreement dated as of April 23, 2012, among Meritor and ArvinMeritor Finance Ireland, as borrowers, the lenders from time to time parties thereto, and JPMorgan Chase Bank, N.A., as administrative agent, and (b) any credit agreement or loan agreement in which Meritor is a borrower and which provides credit facilities that replace or refinance the credit facilities provided under the Credit Agreement described in
clause (a)
, in both cases as amended, restated, or otherwise modified from time to time.
“
Minimum Dilution Reserve
” means, on any day, an amount equal to (a) the Aggregate Capital
plus
the Adjusted LC Participation Amount at the close of business of the Servicer on such date
multipliedby
(b) (i) the Minimum Dilution Reserve Percentage
dividedby
(ii) 100%
minus
the Minimum Dilution Reserve Percentage on such day.
“
Minimum Dilution Reserve Percentage
” means, on any day, the product of (a) the average of the Dilution Ratios for the twelve most recent Fiscal Months
multipliedby
(b) the Dilution Horizon Ratio.
“
Monthly Information Package
” means a report, in substantially the form of
Annex A1
to the Agreement, furnished to the Administrator pursuant to the Agreement, reflective of the Receivables Pool as of the end of the most recent Fiscal Month.
“
Monthly Settlement Date
” means the 25
th
day of each calendar month (or if such day is not a Business Day, the next occurring Business Day).
“
Moody’s
” means Moody’s Investors Service, Inc. and any successor thereto that is a nationally recognized statistical rating organization.
“
Net Receivables Pool Balance
” means, at any time: (a) the Outstanding Balance of Eligible Receivables then in the Receivables Pool,
minus
(b) the Excess Concentration.
“
Notes
” means short-term promissory notes issued, or to be issued, by any Conduit Purchaser to fund its investments in accounts receivable or other financial assets.
“
Notice Date
” has the meaning set forth in
Section 1.12(b)
.
“
Obligations
” has the meaning set forth in
Section 1.2(d)
.
“
Obligor
” means, with respect to any Receivable or Excluded Receivable, the Person obligated to make payments pursuant to the Contract relating to such Receivable or Excluded Receivable, as the case may be.
“
Obligor Percentage
” means, at any time, for each Obligor, a fraction, expressed as a percentage, (a) the numerator of which is the aggregate Outstanding Balance of the Eligible Receivables of such Obligor less the amount (if any) then included in the calculation of the Excess Concentration pursuant to
clause (i)
of the definition thereof with respect to such Obligor, and (b) the denominator of which is the aggregate Outstanding Balance of all Eligible Receivables at such time;
provided
,
however
, that Oshkosh Corporation’s Obligor Percentage shall not be deemed to exceed 15.00% for so long as Oshkosh Corporation remains a Special Obligor pursuant to the definition of “Concentration Percentage”.
“
OFAC
” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
“
Order
” has the meaning set forth in
Section 1.20
of the Agreement.
“
Originator
” and “
Originators
” have the meaning set forth in the Purchase and Sale Agreement, as the same may be modified from time to time by adding new Originators or removing Originators, in each case with the prior written consent of the Administrator. As of the Closing Date, the Originators are Meritor Heavy Vehicle Braking Systems (U.S.A.), LLC, a Delaware limited liability company, and Meritor Heavy Vehicle Systems, LLC, a Delaware limited liability company.
“
Other Navistar Collections
” means funds that are received in payment of any amounts owed in respect of an Excluded Receivable of the type described in clause (v) of the definition thereof.
“
Other Taxes
” means any and all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies or fees arising from any payment made hereunder or from the execution, delivery, filing, recording or enforcement of, or otherwise in respect of, this Agreement, the other Transaction Documents and the other documents or agreements to be delivered hereunder or thereunder.
“
Outstanding Balance
” of any Receivable at any time means the then outstanding principal balance thereof.
“
Participant
” has the meaning set forth in
Section 5.3(b)
of this Agreement.
“
Participation Advance
” has the meaning set forth in
Section 1.14(c)
.
“
Paydown Notice
” has the meaning set forth in
Section 1.4(f)(i)
of the Agreement.
“
PBGC
” means the Pension Benefit Guaranty Corporation, or any successor thereto.
“
Pension Plan
” means a pension plan as defined in Section 3(2) of ERISA that is subject to Title IV of ERISA with respect to which Meritor, any Originator, the Seller or any other member of the Controlled Group may have any liability, contingent or otherwise.
“
Performance Guarantor
” means Meritor, Inc.
“
Performance Guaranty
” means the Performance Guaranty, dated as of the Closing Date, by the Performance Guarantor in favor of the Administrator for the benefit of the Purchasers and the Purchaser Agents, as the same may be amended, restated, supplemented or otherwise modified from time to time.
“
Permitted 2026 Put
” means the exercise by the holders of 2026 Convertible Notes of their option to require Meritor to repurchase such notes on March 1, 2016 under and in accordance with the terms of the 2006 Senior Note Indenture. As used in this definition, “2026 Convertible Notes” and “2006 Senior Note Indenture” have the respective meanings set forth in the Meritor Credit Agreement as in effect on the Closing Date.
“
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.
“
PNC
” has the meaning set forth in the preamble to the Agreement.
“
Pool Assets
” has the meaning set forth in
Section 1.2(d)
of the Agreement.
“
Pool Receivable
” means a Receivable in the Receivables Pool.
“
Portion of Capital
” means, with respect to any Purchaser and its related Capital, the portion of such Capital being funded or maintained by such Purchaser by reference to a particular interest rate basis.
“
Priority Debt Ratio
” has the meaning assigned to such term in the Meritor Credit Agreement as in effect on the Closing Date (without giving effect to any subsequent amendment or other modification thereof).
“
Pro Rata Share
” shall mean, as to any LC Participant, a fraction, the numerator of which equals the Commitment of such LC Participant at such time and the denominator of which equals the aggregate of the Commitments of all LC Participants at such time.
“
Program Support Agreement
” means and includes any Liquidity Agreement and any other agreement entered into by any Program Support Provider providing for: (a) the issuance of one or more letters of credit for the account of any Conduit Purchaser, (b) the issuance of one or more surety bonds for which any Conduit Purchaser is obligated to reimburse the applicable Program Support Provider for any drawings thereunder, (c) the sale by any Conduit Purchaser to any Program Support Provider of the Purchased Interest (or portions thereof) maintained by such Conduit Purchaser and/or (d) the making of loans and/or other extensions of credit to any Conduit Purchaser in connection with such Conduit Purchaser’s receivables-securitization program contemplated in the Agreement, together with any letter of credit, surety bond or other instrument issued thereunder.
“
Program Support Provider
” means and includes, with respect to any Conduit Purchaser, any Liquidity Provider and any other Person (other than any customer of such Conduit Purchaser) now or hereafter extending credit or having a commitment to extend credit to or for the account of, or to make purchases from, such Conduit Purchaser pursuant to any Program Support Agreement.
“
Purchase
” has the meaning set forth in
Section 1.1(a)
of this Agreement.
“
Purchase Account
” means the account identified as such on
Schedule V
of this Agreement.
“
Purchase and Sale Agreement
” means the Fourth Amended and Restated Purchase and Sale Agreement, dated as of the Closing Date, among the Servicer, the Originators and the Seller, as such agreement may be amended, supplemented or otherwise modified from time to time.
“
Purchase Date
” means the date on which a Funded Purchase or a reinvestment is made pursuant to this Agreement.
“
Purchase Facility
” means the receivables purchase facility evidenced by this Agreement.
“
Purchase Limit
” means $100,000,000 as reduced from time to time pursuant to
Section 1.1(c)
. References to the unused portion of the Purchase Limit shall mean, at any time, an amount equal to (x) the Purchase Limit at such time,
minus
(y) the sum of the Aggregate Capital plus the LC Participation Amount.
“
Purchase Notice
” has the meaning set forth in
Section 1.2(a)
of the Agreement.
“
Purchased Interest
” means, at any time, the undivided percentage ownership interest in: (a) each and every Pool Receivable now existing or hereafter arising, (b) all Related Security with respect to such Pool Receivables and (c) all Collections with respect to, and other proceeds of, such Pool Receivables and Related Security. Such undivided percentage interest shall be computed as:
Aggregate Capital + Adjusted LC
Participation Amount + Total Reserves
Net Receivables Pool Balance
The Purchased Interest shall be determined from time to time pursuant to
Section 1.3
of the Agreement.
“
Purchaser
” means each Conduit Purchaser, Related Committed Purchaser, LC Participant and the LC Bank.
“
Purchaser Agent
” means each Person acting as agent on behalf of a Purchaser Group and designated as a Purchaser Agent for such Purchaser Group on the signature pages to this Agreement or any other Person who becomes a party to this Agreement as a Purchaser Agent pursuant to a Transfer Supplement or otherwise in accordance with this Agreement.
“
Purchaser Group
” means, (i) for any Conduit Purchaser, such Conduit Purchaser, together with such Conduit Purchaser’s Related Committed Purchasers, related Purchaser Agent and related LC Participants and (ii) for any other Purchaser that does not have a related Conduit Purchaser, such Purchaser, together with its Purchaser Agent and each other Purchaser for which such Purchaser Agent acts as a Purchaser Agent hereunder. The sole Purchaser Group party to the Agreement as of the Closing Date is identified on
Schedule IV
.
“
Purchasers’ Share
” of any amount, at any time, means such amount
multipliedby
the Purchased Interest at such time.
“
Purchasing Related Committed Purchaser
” has the meaning set forth in
Section 5.3(c)
of this Agreement.
“
Ratable Share
” means, for each Purchaser Group, such Purchaser Group’s Group Commitment
dividedby
the aggregate Group Commitments of all Purchaser Groups.
“
Rating Agency
” mean each of Standard & Poor’s, Fitch and Moody’s (and/or each other rating agency then rating the Notes of any Conduit Purchaser).
“
Rating Agency Condition
” means, when applicable, with respect to any Conduit Purchaser and any event or occurrence, receipt by the Administrator (or the applicable Purchaser Agent) of written confirmation from each Rating Agency then rating the Notes of such Conduit Purchaser that such event or occurrence shall not cause the rating on the then outstanding Notes of such Conduit Purchaser to be downgraded or withdrawn.
“
Receivable
” means any indebtedness and other obligations owed to any Originator or the Seller (as assignee of an Originator), or any right of the Seller or any Originator to payment from or on behalf of, an Obligor, whether constituting an account, chattel paper, payment intangible, instrument or general intangible, in each instance arising in connection with the sale of goods or the rendering of services, and includes, without limitation, the obligation to pay any finance charges, fees and other charges with respect thereto;
provided
,
however
, that “Receivable” does not include any Excluded Receivable. Indebtedness and other obligations arising from any one transaction, including, without limitation, indebtedness and other obligations represented by an individual invoice or agreement, shall constitute a Receivable separate from a Receivable consisting of the indebtedness and other obligations arising from any other transaction.
“
Receivables Pool
” means, at any time, all of the then outstanding Receivables transferred (or purported to be transferred) to the Seller pursuant to the Purchase and Sale Agreement prior to the Facility Termination Date.
“
Reimbursement Obligation
” has the meaning set forth in
Section 1.14
of the Agreement.
“
Related Committed Purchaser
” means each Person listed as such for each Conduit Purchaser as set forth on the signature pages of this Agreement or in any or Transfer Supplement.
“
Related Rights
” has the meaning set forth in
Section 1.1
of the Purchase and Sale Agreement.
“
Related Security
” means, with respect to any Receivable:
(a) all of the Seller’s and each Originator’s interest in any goods (including returned goods), and documentation of title evidencing the shipment or storage of any goods (including returned goods), the sale of which gave rise to such Receivable;
(b) all instruments and chattel paper that may evidence such Receivable;
(c) all other 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 UCC financing statements or similar filings relating thereto;
(d) all of the Seller’s and each Originator’s rights, interests and claims under the related Contracts and all guaranties, indemnities, insurance and other agreements (including the related Contract) or arrangements of whatever character from time to time supporting or securing payment of such Receivable or otherwise relating to such Receivable, whether pursuant to the Contract related to such Receivable or otherwise; and
(e) all of the Seller’s rights, interests and claims under the Purchase and Sale Agreement and the other Transaction Documents.
“
Required Capital Amount
” means $18,000,000.
“
Restricted Payments
” has the meaning set forth in
Section 1(n)
of
Exhibit IV
of the Agreement.
“
Sanctioned Country
” means a country subject to a sanctions program identified on the list maintained by OFAC and available at:
http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx
, or as otherwise published from time to time.
“
Sanctioned Person
” means (i) A person named on the list of “Specially Designated Nationals” or “Blocked Persons” maintained by OFAC available at:
http://www.treasury.gov/resource-center/sanctions/SDN-List/Pages/default.aspx
, or as otherwise published from time to time or (ii) (A) an agency of the government of a Sanctioned Country, (B) an organization controlled by a Sanctioned Country, or (C) a person resident in a Sanctioned Country, to the extent subject to a sanctions program administered by OFAC.
“
Scheduled Commitment Termination Date
” means with respect to any Purchaser, June 18, 2015, as such date may be extended from time to time in the sole discretion of Purchaser in accordance with
Section 1.2(e)
.
“
SEC
” shall mean the Securities and Exchange Commission or any governmental agencies substituted therefor.
“
Seller
” has the meaning set forth in the preamble to the Agreement.
“
Seller’s Net Worth
” means, at any time, an amount equal to (i) the Outstanding Balance of all Receivables then in the Receivables Pool at such time,
minus
(ii) the sum of (A) Aggregate Capital at such time,
plus
(B) the Adjusted LC Participation Amount,
plus
(C) the aggregate accrued and unpaid Discount and Fees at such time,
plus
(D) the aggregate outstanding principal balance of all Subordinated Notes at such time,
plus
(E) the aggregate accrued and unpaid interest on the Subordinated Notes at such time.
“
Seller’s Share
” of any amount means the greater of: (a) $0 and (b) such amount
minus
the Purchasers’ Share.
“
Servicer
” has the meaning set forth in the preamble to the Agreement.
“
Servicing Fee
” shall mean the fee referred to in
Section 4.6
of the Agreement.
“
Servicing Fee Rate
” shall mean the rate referred to in
Section 4.6
of the Agreement.
“
Settlement Date
” means with respect to any Portion of Capital for any Settlement Period, (i) prior to the Facility Termination Date, the Monthly Settlement Date and (ii) on and after the Facility Termination Date, each day selected from time to time by the Administrator (with the consent or at the direction of the Majority Purchaser Agents) (it being understood that the Administrator (with the consent or at the direction of the Majority Purchaser Agents) may select such Settlement Date to occur as frequently as daily), or, in the absence of such selection, the Monthly Settlement Date.
“
Settlement Period
” means: (a) before the Facility Termination Date: (i) initially the period commencing on the date of the initial purchase pursuant to
Section 1.2
of the Agreement (or in the case of any fees payable hereunder, commencing on the Closing Date) and ending on (but not including) the next Monthly Settlement Date, and (ii) thereafter, each period commencing on such Monthly Settlement Date and ending on (but not including) the next Monthly Settlement Date, and (b) on and after the Facility Termination Date, such period (including a period of one day) as shall be selected from time to time by the Administrator (with the consent or at the direction of the Majority Purchaser Agents) or, in the absence of any such selection, each period of 30 days from the last day of the preceding Settlement Period.
“
Standard & Poor’s
” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business and any successor thereto that is a nationally recognized statistical rating organization.
“
Subordinated Note
” has the meaning set forth in the Purchase and Sale Agreement.
“
Sub-Servicer
” has the meaning set forth in
Section 4.1(d)
of this Agreement.
“
Subsidiary
” means, as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock of each class or other interests having ordinary voting power (other than stock or other interests having such power only by reason of the happening of a contingency) to elect a majority of the Board of Directors or other managers of such entity are at the time owned, or management of which is otherwise controlled: (a) by such Person, (b) by one or more Subsidiaries of such Person or (c) by such Person and one or more Subsidiaries of such Person.
“
Taxes
” means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority and all interest, penalties, additions to tax and any similar liabilities with respect thereto.
“
Termination Day
” means: (a) each day on which any of the conditions set forth in
Section 2
of
Exhibit II
to the Agreement are not satisfied or (b) each day that occurs on or after the Facility Termination Date.
“
Termination Event
” has the meaning specified in
Exhibit V
to the Agreement. For the avoidance of doubt, any Termination Event that occurs shall be deemed to be continuing unless and until such Termination Event has been waived in accordance with the terms of the Agreement.
“
Total Reserves
” means, at any time, the sum of: (a) the Yield Reserve,
plus
(b) the greater of (i) the sum of the Concentration Reserve
plus
the Minimum Dilution Reserve and (ii) the sum of the Loss Reserve
plus
the Dilution Reserve.
“
Transaction Documents
” means the Agreement, the Lock-Box Agreements, the Fee Letter, the Purchase and Sale Agreement, each Subordinated Note, the Performance Guaranty, the Intercreditor Agreement and all other certificates, instruments, UCC financing statements, reports, notices, agreements and documents executed or delivered under or in connection with the Agreement, in each case as the same may be amended, supplemented or otherwise modified from time to time in accordance with the Agreement.
“
Transaction Information
” shall mean any information provided to any Rating Agency, in each case, to the extent related to such Rating Agency providing or proposing to provide a rating of any Notes or monitoring such rating including, without limitation, information in connection with the Seller, the Originator, the Servicer or the Receivables;
provided
that, for the avoidance of doubt, “Transaction Information” shall not include any information provided by Meritor or any of its Affiliates to any nationally recognized statistical rating organization (other than information solely related to the Receivables subject to this Agreement) in connection with such rating organization providing a rating or proposing to provide a rating to, or monitoring an existing rating of Meritor or any of its Affiliates or any debt securities of any of the foregoing.
“
Transfer Supplement
” has the meaning set forth in
Section 5.3(c)
of this Agreement.
“
UCC
” means the Uniform Commercial Code as from time to time in effect in the applicable jurisdiction.
“
Unmatured Termination Event
” means an event that, with the giving of notice or lapse of time, or both, would constitute a Termination Event.
“
Weekly Information Package
” means a report, in substantially the form of
Annex A2
to the Agreement, furnished to the Administrator pursuant to this Agreement, reflective of the Receivables Pool as of the end of business on the most recent Wednesday.
“
Weighted Average Credit Term Factor
” means, on any date, the Weighted Average Credit Terms on such date,
minus
:
(a) if the Weighted Average Credit Terms on such date is less than or equal to 30, then the Weighted Average Credit Terms (it being understood that if determined pursuant to this
clause (a)
, the Weighted Average Credit Term Factor will be zero);
(b) if the Weighted Average Credit Terms on such date is greater than 30 but less than or equal to 60, then 30;
(c) if the Weighted Average Credit Terms on such date is greater than 60 but less than or equal to 90, then 60; or
(d) if the Weighted Average Credit Terms on such date is greater than 90, then 90.
“
Weighted Average Credit Terms
” means, on any date, the weighted average payment terms (computed in days and calculated based on the difference between the original invoice date and the stated maturity date) of invoices for Receivables originated during the current Fiscal Month;
provided
that such weighting shall be based on the Outstanding Balance of such Receivables on such date.
“
Yield Reserve
” means, on any date, an amount equal to the product of (i) the sum of the Aggregate Capital
plus
the LC Participation Amount at the close of business of the Servicer on such date
multipliedby
(ii) (x) the Yield Reserve Percentage on such date
dividedby
(y) 100%
minus
the Yield Reserve Percentage on such date.
“
Yield Reserve Percentage
” means at any time:
1.50 x DSO x (BR + SFR)
360
where:
|
|
|
|
BR
|
= the daily average Base Rate computed for the most recent Settlement Period,
|
|
|
|
|
DSO
|
= Days’ Sales Outstanding for the Fiscal Month most recently ended, and
|
|
|
|
|
SFR
|
= the Servicing Fee Rate.
|
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.
Rating Levels
. For purposes of the definitions of “Group A Obligor”, “Group B Obligor” and “Group C Obligor”, if an Obligor is rated at different levels by Standard & Poor’s and Moody’s, then: (i) if such ratings are one level apart, then the lower of the two ratings shall apply, (ii) if such ratings are more than one level apart, then the rating level exactly halfway between the two ratings shall apply and (iii) if such ratings are more than one level apart, and no rating level that is exactly halfway between the two ratings can be determined, then the rating level immediately below the rating level that would be exactly halfway between such rating levels shall apply.
EXHIBIT II
CONDITIONS OF PURCHASES
1.
Conditions Precedent to Effectiveness
. The effectiveness of this Agreement is subject to the condition precedent that the Administrator shall have received, on or before the Closing Date, each of the following, each in form and substance (including the date thereof) satisfactory to the Administrator and each Purchaser Agent:
(c)
Counterparts of (i) this Agreement, duly executed by the parties hereto, and (ii) the Lock-Box Agreements, the Fee Letter, the Purchase and Sale Agreement, the Ally Payoff Agreement, the Intercreditor Agreement and the Performance Guaranty, duly executed by the parties thereto.
(d)
Certified copies of: (i) the resolutions or unanimous written consents of the board of directors (or the equivalent thereof) of each of the Seller, the Servicer and the Originators authorizing the execution, delivery and performance by the Seller, the Servicer and the Originators, as the case may be, of this Agreement and the other Transaction Documents to which it is a party; (ii) all documents evidencing other necessary corporate or organizational action and governmental approvals, if any, with respect to this Agreement and the other Transaction Documents and (iii) the certificate of incorporation (or certificate of formation) and by-laws or limited liability company agreement, as applicable, of the Seller, the Originators and the Servicer.
(e)
A certificate of the Secretary or Assistant Secretary of each of the Seller, the Servicer and the Originators certifying the names and true signatures of its officers who are authorized to sign this Agreement and the other Transaction Documents to which it is a party. Until the Administrator receives a subsequent incumbency certificate from the Seller, the Servicer or such Originators, as the case may be, the Administrator shall be entitled to rely on the last such certificate delivered to it by the Seller, the Servicer or such Originators, as the case may be.
(f)
Proper financing statements (Form UCC‑1), duly authorized and suitable for filing under the UCC of 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 Purchasers) contemplated by the Purchase and Sale Agreement and this Agreement, as applicable.
(g)
Proper financing statement amendments (Form UCC‑3), duly authorized and suitable for filing under the UCC of all jurisdictions that the Administrator may deem necessary or desirable to release all security interests and other rights of any Person in the Receivables, Contracts or Related Security previously granted by the Originators or the Seller.
(h)
Completed UCC search reports, dated on or shortly before the Closing Date, listing the financing statements filed in all applicable jurisdictions that name the Originators or the Seller as debtor, together with copies of such other financing statements, and similar search reports with respect to judgment liens, federal tax liens and liens of the PBGC in such jurisdictions, as the Administrator may request, showing no Adverse Claims on any Pool Assets other than any security interests that are released as of the Closing Date.
(i)
Favorable opinions, addressed to the Administrator, each Purchaser Agent and each Purchaser, in form and substance reasonably satisfactory to the Administrator, from Faegre Baker Daniels LLP, counsel for the Seller, the Originator and the Servicer, and internal counsel for the Seller, the Originators and the Servicer, covering such matters as the Administrator may reasonably request, including, without limitation, certain organizational and New York enforceability matters, certain bankruptcy matters and certain UCC matters.
(j)
A pro forma Monthly Information Package representing the performance of the Receivables Pool for the calendar month before closing and pro forma Weekly Information Package representing the performance of the Receivables Pool for the week before closing.
(k)
Evidence of payment by the Seller of all accrued and unpaid fees (including those contemplated by the Fee Letters), costs and expenses to the extent then due and payable on the date thereof, including any such costs, fees and expenses arising under or referenced in
Section 5.4
of the Agreement and the Fee Letters.
(l)
certificates of existence or good standing with respect to each of the Seller, the Originators and the Servicer issued by the Secretary of State (or similar official) of the state of each such Person’s organization or formation.
(m)
All information with respect to the Receivables as the Administrator or the Purchasers may reasonably request.
(n)
Such other approvals, opinions or documents as the Administrator or the Purchasers may reasonably request.
2.
Conditions Precedent to All Funded Purchases, Issuances of Letters of Credit and Reinvestments
. Each Funded Purchase (including the initial Funded Purchase) and the issuance of any Letters of Credit and each reinvestment shall be subject to the further conditions precedent that:
(a)
in the case of each Funded Purchase and the issuance of any Letters of Credit, the Servicer shall have delivered to the Administrator and each Purchaser Agent on or before such purchase or issuance, as the case may be, in form and substance reasonably satisfactory to the Administrator and each Purchaser Agent, a completed pro forma Weekly Information Package to reflect the level of Aggregate Capital, the LC Participation Amount and related reserves and the calculation of the Purchased Interest after such purchase or issuance, as the case may be, and a completed Purchase Notice in the form of
Annex B
; and
(b)
on the date of such Funded Purchase, issuance of any Letters of Credit or reinvestment, as the case may be, the following statements shall be true (and acceptance of the proceeds of such Funded Purchase, issuance or reinvestment shall be deemed a representation and warranty by the Seller that such statements are then true):
(i)
the representations and warranties contained in
Exhibit III
to the Agreement are true and correct in all material respects on and as of the date of such Funded Purchase, issuance or reinvestment as though made on and as of such date except for representations and warranties which apply as to an earlier date (in which case such representations and warranties shall be true and correct as of such earlier date);
(ii)
no event has occurred and is continuing, or would result from such Funded Purchase, issuance or reinvestment, that constitutes a Termination Event or an Unmatured Termination Event;
(iii)
the Aggregate Capital
plus
the LC Participation Amount, after giving effect to any such Funded Purchase, issuance or reinvestment, as the case may be, does not exceed the Purchase Limit;
(iv)
the LC Participation Amount does not exceed the aggregate of the Commitments of the LC Participants;
(v)
the Purchased Interest does not exceed 100%; and
(vi)
the Facility Termination Date has not occurred.
EXHIBIT III
REPRESENTATIONS AND WARRANTIES
1.
Representations and Warranties of the Seller
. The Seller represents and warrants to the Administrator, each Purchaser Agent and each Purchaser that:
(o)
Existence and Power
. The Seller is a corporation duly organized, validly existing and in good standing under the laws of Delaware, and has all corporate power and all governmental licenses, authorizations, consents and approvals required to carry on its business in each jurisdiction in which its business is conducted except if failure to have such licenses, authorizations, consents or approvals could not reasonably be expected to have a Material Adverse Effect.
(p)
Company and Governmental Authorization, Contravention
. The execution, delivery and performance by the Seller of this Agreement and each other Transaction Document to which it is a party are within the Seller’s corporate powers, have been duly authorized by all necessary corporate action, require no action by or in respect of, or filing with (other than the filing of UCC financing statements and continuation statements), any governmental body, agency or official, and, do not contravene, or constitute a default under, any provision of applicable law or regulation or of the operating agreement of the Seller or of any agreement, judgment, injunction, order, decree or other instrument binding upon the Seller or result in the creation or imposition of any lien (other than liens in favor of the Administrator) on assets of the Seller.
(q)
Binding Effect of Agreement
.
This Agreement and each other Transaction Document to which it is a party constitute the legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its respective terms, except as such 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 enforceability is considered in a proceeding in equity or at law.
(r)
Accuracy of Information
. Each Information Package and all information heretofore furnished by or on behalf of the Seller (or, in the case of any Information Package, by or on behalf of the Servicer) to the Administrator, any Purchaser Agent or any Purchaser pursuant to or in connection with this Agreement or any other Transaction Document is, and each Information Package and all such other information hereafter furnished by or on behalf of the Seller (or, in the case of any Information Package, by or on behalf of the Servicer) to the Administrator, any Purchaser Agent or any Purchaser in writing pursuant to this Agreement or any Transaction Document will be, true and accurate in all material respects on the date such information is stated or certified.
(s)
Actions, Suits
.
There are no actions, suits or proceedings pending or, to the best of the Seller’s knowledge, threatened against or affecting the Seller or its properties, in or before any court, arbitrator or other body, which could reasonably be expected to have a Material Adverse Effect.
(t)
Accuracy of Exhibits; Account Arrangements
.
The names and addresses of all the Lock-Box Banks together with the account numbers of the Lock-Box Accounts and Lock-Boxes at such Lock-Box Banks, are specified in
Schedule II
to this Agreement (or at such other Lock-Box Banks and/or with such other Lock-Box Accounts and Lock-Boxes as have been notified to the Administrator), and each Lock-Box Account and Lock-Box is subject to a Lock-Box Agreement. All information on each Exhibit, Schedule or Annex to this Agreement or the other Transaction Documents (as updated by the Seller from time to time) is true and complete. The Seller has not granted any interest in any Lock-Box Account (or any related Lock-Box) to any Person other than the Administrator and, upon delivery to a Lock-Box Bank of the related Lock-Box Agreement, the Administrator will have control (within the meaning of Section 9-104 of the UCC) of the Lock-Box Account at such Lock-Box Bank.
(u)
No Material Adverse Effect
.
Since the date of formation of Seller as set forth in its certificate of formation, there has been no Material Adverse Effect with respect to the Seller.
(v)
Names and Location
. The Seller has not used any corporate names, trade names or assumed names other than its name set forth on the signature pages of this Agreement. The Seller is “located” (as such term is defined in the applicable UCC) in Delaware. The office where the Seller keeps its records concerning the Receivables is at the address set forth below its signature to this Agreement.
(w)
Margin Stock
. The Seller is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T, U and X, as issued by the Board of Governors of the Federal Reserve System), and no proceeds of any purchase or reinvestment hereunder will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock.
(x)
Eligible Receivables
. Each Pool Receivable listed as an Eligible Receivable or included as an “Eligible Receivable” in the calculation of the Net Receivables Pool Balance in any Information Package delivered by Seller or the Servicer is an Eligible Receivable as of the effective date of the information reported in such Information Package.
(y)
Credit and Collection Policy
. The Seller has complied in all material respects with the Credit and Collection Policy with regard to each Receivable originated by such Originator.
(z)
Investment Company Act
. The Seller is not an “investment company,” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.
(aa)
No Sanctions
. The Seller is not a Sanctioned Person. To the Seller’s knowledge, no Obligor was a Sanctioned Person at the time of origination of any Pool Receivable owing by such Obligor. The Seller and its Affiliates: (i) have less than 15% of their assets in Sanctioned Countries; and (ii) derive less than 15% of their operating income from investments in, or transactions with Sanctioned Persons or Sanctioned Countries. Neither the Seller nor any of its Subsidiaries engages in activities related to Sanctioned Countries except for such activities as are (A) specifically or generally licensed by OFAC, or (B) otherwise in compliance with OFAC’s sanctions regulations.
(bb)
Transaction Information
. None of the Seller, any Affiliate of the Seller or any third party with which the Seller or any Affiliate thereof has contracted, has delivered, in writing or orally, to any Rating Agency, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and has not participated in any oral communications with respect to Transaction Information with any Rating Agency without the participation of such Purchaser Agent.
2.
Representations and Warranties of the Servicer
. The Servicer represents and warrants to the Administrator, each Purchaser Agent and each Purchaser that:
(c)
Existence and Power
. The Servicer is a corporation, duly organized and validly existing under the laws of the State of Indiana, has filed its most recent biennial report required to be filed in the State of Indiana, and has all corporate power and all governmental licenses, authorizations, consents and approvals required to carry on its business in each jurisdiction in which its business is conducted, except where failure to have such licenses, authorizations, consents or approvals would not be reasonably expected to have a Material Adverse Effect.
(d)
Company and Governmental Authorization, Contravention
. The execution, delivery and performance by the Servicer of this Agreement and each other Transaction Document to which it is a party are within the Servicer’s corporate powers, have been duly authorized by all necessary corporate action, require no action by or in respect of, or filing with, any governmental body, agency or official, and do not contravene, or constitute a default under, any provision of applicable law or regulation or of the certificate of incorporation or bylaws of the Servicer or of any judgment, injunction, order or decree or agreement or other material instrument binding upon the Servicer or result in the creation or imposition of any lien on assets of the Servicer (other than in favor of the Administrator under the Transaction Documents) or any of its Subsidiaries.
(e)
Binding Effect of Agreement
.
This Agreement and each other Transaction Document to which it is a party constitute the legal, valid and binding obligation of the Servicer enforceable against the Servicer in accordance with its terms, except as such 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 enforceability is considered in a proceeding in equity or at law.
(f)
Accuracy of Information
. Each Information Package and all information heretofore furnished by (or on behalf of) the Servicer to the Administrator, any Purchaser Agent or any Purchaser pursuant to or in connection with this Agreement or any other Transaction Document is, and each Information Package and all such other information hereafter furnished by (or on behalf of) the Servicer to the Administrator, any Purchaser Agent or any Purchaser in writing pursuant to this Agreement or any other Transaction Document will be, true and accurate in all material respects on the date such information is stated or certified.
(g)
Actions, Suits
.
Except as set forth in
Schedule III
, there are no actions, suits or proceedings pending or, to the best of the Servicer’s knowledge, threatened against or affecting the Servicer or any of its Affiliates or their respective properties, in or before any court, arbitrator or other body, which could reasonably be expected to have a Material Adverse Effect.
(h)
No Material Adverse Effect
.
Since April 30, 2012, there has been no Material Adverse Effect on the Servicer.
(i)
Credit and Collection Policy
. The Servicer has complied in all material respects with the Credit and Collection Policy with regard to each Receivable.
(j)
Investment Company Act
. The Servicer is not an “investment company,” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.
(k)
No Sanctions
. The Servicer is not a Sanctioned Person. To the Servicer’s knowledge, no Obligor was a Sanctioned Person at the time of origination of any Pool Receivable owing by such Obligor. The Servicer and its Affiliates: (i) have less than 15% of their assets in Sanctioned Countries; and (ii) derive less than 15% of their operating income from investments in, or transactions with Sanctioned Persons or Sanctioned Countries. Neither the Servicer nor any of its Subsidiaries engages in activities related to Sanctioned Countries except for such activities as are (A) specifically or generally licensed by OFAC, or (B) otherwise in compliance with OFAC’s sanctions regulations.
(l)
Transaction Information
. None of the Servicer, any Affiliate of the Servicer or any third party with which the Servicer or any Affiliate thereof has contracted, has delivered, in writing or orally, to any Rating Agency providing or proposing to provide a rating to, or monitoring a rating of, any Notes, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and has not participated in any oral communications with respect to Transaction information with any Rating Agency without the participation of such Purchaser Agent.
(m)
Financial Condition
. The consolidated balance sheets of Servicer and its consolidated subsidiaries as of March 31, 2012and the related statements of income and shareholders’ equity of Meritor and its consolidated subsidiaries for the fiscal quarter then ended, copies of which have been furnished to the Administrator, present fairly in all material respects the consolidated financial position of Meritor and its consolidated subsidiaries for the period ended on such date, all in accordance with GAAP consistently applied; and since such date no event has occurred that has had, or could reasonably be expected to have, a Material Adverse Effect.
3.
Representations, Warranties and Agreements Relating to the Security Interest
. The Seller hereby makes the following representations, warranties and agreements with respect to the Receivables and Related Security:
(a)
The Receivables
.
(i)
Creation
. This Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables included in the Receivables Pool in favor of the Administrator (for the benefit of the Purchasers), which security interest is prior to all other Adverse Claims and is enforceable as such as against creditors of and purchasers from the Seller.
(ii)
Ownership of Receivables
. The Seller owns and has good and marketable title to the Receivables included in the Receivables Pool and Related Security free and clear of any Adverse Claim.
(iii)
Perfection and Related Security
. All appropriate financing statements have been filed in the proper filing office in the appropriate jurisdictions under applicable law in order to perfect the sale of the Receivables and Related Security from such Originator to the Seller pursuant to the Purchase and Sale Agreement, and the sale and security interest therein from the Seller to the Administrator under this Agreement.
(b)
The Lock-Box Accounts
.
(i)
Nature of Lock-Box Accounts
. Each Lock-Box Account constitutes a “deposit account” within the meaning of the applicable UCC.
(ii)
Ownership
. Each Lock-Box Account is in the name of the Seller, and Seller owns and has good and marketable title to the Lock-Box Accounts free and clear of any Adverse Claim (other than the interest of the Lock-Box Bank as set forth in the applicable Lock-Box Agreement).
(iii)
Perfection
. The Seller has delivered to the Administrator a fully executed Lock-Box Agreement relating to each Lock-Box Account, pursuant to which each applicable Lock-Box Bank has agreed, after the “Effective Time” (as defined therein), to comply only with all instructions originated by the Administrator (on behalf of the Purchasers) directing the disposition of funds in such Lock-Box Account without further consent by the Seller or the Servicer.
(c)
Priority
.
(i)
Other than the transfer of the Receivables to the Seller under the Purchase and Sale Agreement, and by the Seller under this Agreement and/or the security interest granted to the Administrator pursuant to this Agreement, neither the Seller nor any Originator has pledged, assigned, sold, granted a security interest in, or otherwise conveyed any of the Receivables transferred or purported to be transferred under the Transaction Documents, the Lock-Box Accounts or any subaccount thereof. Neither the Seller, nor any Originator has authorized the filing of, or is aware of any financing statements against any of the Seller or such Originator that (after giving effect to the Intercreditor Agreement and the filing of financing statement amendments described in
Section (e)
of
Exhibit II
) purport to perfect a security interest in Receivables include a description of Receivables transferred or purported to be transferred under the Transaction Documents, the Lock-Box Accounts or any subaccount thereof, other than any financing statement (i) relating to the sale thereof by such Originator to the Seller under the Purchase and Sale Agreement or (ii) relating to the security interest granted to the Administrator under this Agreement.
(ii)
The Lock-Box Accounts are not in the name of any person other than the Seller. Neither the Seller nor the Servicer has consented to any bank maintaining such account to comply with instructions of any person other than the Company, the Servicer and the Administrator.
(d)
Survival of Supplemental Representations
. Notwithstanding any other provision of this Agreement or any other Transaction Document, the representations contained in this Section shall be continuing, and remain in full force and effect until such time as the Purchased Interest and all other obligations under this Agreement have been finally and fully paid and performed.
4.
Ordinary Course of Business
. Seller represents and warrants that each remittance of Collections by or on behalf of the Seller to the Purchasers under this Agreement will have been (i) in payment of a debt incurred by the Seller in the ordinary course of business or financial affairs of the Seller and (ii) made in the ordinary course of business or financial affairs of the Seller.
5.
Reaffirmation of Representations and Warranties
.
On the date of each purchase and/or reinvestment and issuance of a Letter of Credit hereunder, and on the date each Information Package or other report is delivered to the Administrator, any Purchaser Agent or any Purchaser hereunder, the Seller and the Servicer, by accepting the proceeds of such purchase, reinvestment or Letter of Credit, as applicable and/or the provision of such information or report, shall each be deemed to have certified that (i) all representations and warranties of the Seller and the Servicer, as applicable, described in this
Exhibit III
, as from time to time amended in accordance with the terms hereof, are correct in all material respects on and as of such day as though made on and as of such day, except for representations and warranties which apply as to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such date), and (ii) no Termination Event or an Unmatured Termination Event has occurred and is continuing or will result from such purchase, reinvestment or issuance.
EXHIBIT IV
COVENANTS
1.
Covenants of the Seller
. At all times from the Closing Date until the Final Payout Date:
(cc)
Financial Reporting
. The Seller will maintain a system of accounting established and administered in accordance with generally accepted accounting principles as in effect in the United States, and the Seller (or the Servicer on its behalf) shall furnish to the Administrator and each Purchaser Agent:
(i)
Annual Financial Statements of the Seller
.
Promptly upon completion and in no event later than 120 days after the close of each fiscal year of the Seller, annual unaudited financial statements of the Seller certified by a designated financial or other officer of the Seller.
(ii)
Information Packages
. (A) As soon as available and in any event not later than 2 Business Days prior to each Monthly Settlement Date, a Monthly Information Package as of the most recently completed Fiscal Month, and (B) on each Friday of each week (or, if such day is not a Business Day, on the following Business Day), a Weekly Information Package.
(iii)
Other Information
.
Such other information (including non-financial information) as the Administrator or any Purchaser Agent may from time to time reasonably request.
(iv)
Quarterly Financial Statements of Meritor, Inc.
. As soon as available and in no event later than 45 days following the end of each of the first three fiscal quarters in each of Meritor’s fiscal years, (i) the unaudited consolidated balance sheet and statements of income of Meritor and its Subsidiaries as at the end of such fiscal quarter and the related unaudited consolidated statements of earnings and cash flows for such fiscal quarter and for the elapsed portion of the fiscal year ended with the last day of such fiscal quarter, in each case setting forth comparative figures for the corresponding fiscal quarter in the prior fiscal year, all of which shall be certified by the chief financial officer, the treasurer or any financial officer (including a controller) of Meritor that they fairly present in all material respects, in accordance with generally accepted accounting principles as in effect in the United States consistently applied, the financial condition of Meritor and its consolidated Subsidiaries as of the dates indicated and the results of their operations for the periods indicated, subject to normal year-end audit adjustments and the absence of footnotes, and (ii) management’s discussion and analysis of the important operational and financial developments during such fiscal quarter.
(v)
Annual Financial Statements of Meritor, Inc.
. Within 90 days after the close of each of Meritor’s fiscal years, the consolidated balance sheet of Meritor and its consolidated Subsidiaries as at the end of such fiscal year and the related consolidated statements of earnings and cash flows for such fiscal year setting forth comparative figures for the preceding fiscal year, all reported on by independent certified public accountants of recognized national standing (without a “going concern” or like qualification or exception) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of Meritor and its Subsidiaries on a consolidated basis in accordance with generally accepted accounting principals as in effect in the United States consistently applied.
(vi)
Other Reports and Filings
. Promptly (but in any event within ten days) after the filing or delivery thereof, copies of all financial information, proxy materials and reports, if any, which Meritor or any of its consolidated Subsidiaries shall publicly file with the SEC or deliver to holders (or any trustee, agent or other representative therefor) of any of its material Indebtedness pursuant to the terms of the documentation governing the same.
(vii)
Notwithstanding anything herein to the contrary, any financial information, proxy statements or other material required to be delivered pursuant to this
paragraph (a)
shall be deemed to have been furnished to each of the Administrator and each Purchaser Agent on the date that such report, proxy statement or other material is posted on the SEC’s website at www.sec.gov or on Meritor’s website at www.meritor.com.
(dd)
Notices
. The Seller (or the Servicer on its behalf) will notify the Administrator and each Purchaser Agent in writing of any of the following events promptly upon (but in no event later than three Business Days after) a financial or other officer learning of the occurrence thereof, with such notice describing the same, and if applicable, the steps being taken by the Person(s) affected with respect thereto:
(i)
Notice of Termination Events or Unmatured Termination Events
. A statement of the chief financial officer or chief accounting officer of the Seller setting forth details of any Termination Event or Unmatured Termination Event that is continuing and the action which the Seller proposes to take with respect thereto.
(ii)
Representations and Warranties
. The failure of any representation or warranty with respect to the Receivables included in the Receivables Pool to be true in any material respect when made.
(iii)
Litigation
. The institution of any litigation, arbitration proceeding or governmental proceeding which have a Material Adverse Effect on the Seller.
(iv)
Adverse Claim
.
(A) Any Person shall obtain an Adverse Claim upon the Pool Receivables or Collections with respect thereto, (B) any Person other than the Seller, the Servicer or the Administrator shall obtain any rights or direct any action with respect to any Lock-Box Account (or related Lock-Box) or (C) any Obligor shall receive any change in payment instructions with respect to Pool Receivable(s) from a Person other than the Servicer or the Administrator.
(v)
Material Adverse Change
. 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 or any Originator.
(ee)
Conduct of Business
. The Seller will carry on and conduct its business in substantially the same manner and in substantially the same fields of enterprise as it is presently conducted and will do all things necessary to remain duly organized, validly existing and in good standing as a domestic organization in its jurisdiction of organization and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted.
(ff)
Compliance with Laws
. The Seller will comply with all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to which it may be subject if the failure to comply could reasonably be expected to have a Material Adverse Effect.
(gg)
Furnishing of Information and Inspection of Receivables
. The Seller will furnish or cause to be furnished to the Administrator from time to time such information with respect to the Pool Receivables as the Administrator may reasonably request. The Seller will, at the Seller’s expense, during regular business hours with prior written notice (i) permit the Administrator or its agents or representatives to (A) examine and make copies of and abstracts from all books and records relating to the Pool Receivables or other Pool Assets and (B) visit the offices and properties of the Seller for the purpose of examining such books and records, and (C) discuss matters relating to the Pool Receivables, other Pool Assets or the Seller’s performance hereunder or under the other Transaction Documents to which it is a party with any of the officers, directors, employees or independent public accountants of the Seller (provided that representatives of the Seller are present during such discussions) having knowledge of such matters and (ii) without limiting the provisions of
clause (i)
above, during regular business hours, at the Seller’s expense, upon prior written notice from the Administrator, permit certified public accountants or other auditors acceptable to the Administrator to conduct a review of its books and records with respect to such Receivables;
provided
, that the Seller shall be required to reimburse the Administrator for only one (1) such audit in any twelve-month period, unless a Termination Event has occurred and is continuing.
(hh)
Payments on Receivables, Lock-Box Accounts
. The Seller (or the Servicer on its behalf) will, and will cause each Originator to, at all times, instruct all Obligors to deliver payments on the Pool Receivables to a Lock-Box Account or a Lock-Box. The Seller (or the Servicer on its behalf) will, and will cause each Originator to, at all times, maintain such books and records necessary to identify Collections received from time to time on Receivables and to segregate such Collections from other property of the Servicer and the Originators (including without limitation Other Navistar Collections). If any payments on the Pool Receivables or other Collections are received by the Seller, the Servicer or an Originator, it shall hold such payments in trust for the benefit of the Administrator, the Purchaser Agents and the Purchasers and promptly (but in any event within one Business Day after receipt) remit such funds into a Lock-Box Account. The Seller (or the Servicer on its behalf) will cause each Lock-Box Bank to comply with the terms of each applicable Lock-Box Agreement. Except for Other Navistar Collections, the Seller shall not permit funds other than Collections on Pool Receivables and other Pool Assets to be deposited into any Lock-Box Account. If such funds are nevertheless deposited into any Lock-Box Account, the Seller (or the Servicer on its behalf) will within two Business Days identify and transfer such funds, and all Funds constituting Other Navistar Collections to the appropriate Person entitled to such funds. Except with respect to Other Navistar Collections, the Seller will not, and will not permit the Servicer, any Originator or other Person to commingle Collections or other funds to which the Administrator, any Purchaser Agent or any Purchaser is entitled with any other funds, except cash concentration accounts maintained by Meritor, prior to segregation pursuant to
Section 1.4
of the Agreement. The Seller shall only add a Lock-Box Account (or the related Lock-Box), or a Lock-Box Bank to those listed on
Schedule II
to this Agreement, if the Administrator has received notice of such addition and an executed and acknowledged copy of a Lock-Box Agreement in form and substance acceptable to the Administrator from any such new Lock-Box Bank. The Seller shall only terminate a Lock-Box Bank or close a Lock-Box Account (or the related Lock-Box) with the prior written consent of the Administrator.
(ii)
Sales, Liens, etc.
Except as otherwise provided herein, the Seller will not sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any Adverse Claim upon (including, without limitation, the filing of any financing statement) or with respect to, any Pool Receivable or other Pool Asset, or assign any right to receive income in respect thereof.
(jj)
Extension or Amendment of Pool Receivables
.
Except as otherwise permitted in
Section 4.2
of this Agreement, the Seller will not, and will not permit the Servicer to, alter the delinquency status or adjust the Outstanding Balance or otherwise modify the terms of any Pool Receivable in any material respect, or amend, modify or waive, in any material respect, any term or condition of any related Contract. The Seller shall at its expense, timely and fully perform and comply in all material respects with all provisions, covenants and other promises required to be observed by it under the Contracts related to the Pool Receivables, and timely and fully comply with the Credit and Collection Policy with regard to each Pool Receivable and the related Contract.
(kk)
Change in Credit and Collection Policy
. The Seller will not make any material change in the Credit and Collection Policy without the prior written consent of the Administrator and the Majority Purchaser Agents.
(ll)
Fundamental Changes
. The Seller shall not, without the prior written consent of the Administrator and the Majority Purchaser Agents, permit itself (i) to merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to, any Person or (ii) to be owned by any Person other than Meritor. The Seller shall provide the Administrator with at least 30 days’ prior written notice before making any change in the Seller’s name, location or making any other change in the Seller’s identity or corporate structure that could impair or otherwise render any UCC financing statement filed in connection with this Agreement “seriously misleading” as such term (or similar term) is used in the applicable UCC; each notice to the Administrator and the Purchaser Agents pursuant to this sentence shall set forth the applicable change and the proposed effective date thereof. The Seller will also maintain and implement (or cause the Servicer to maintain and implement) administrative and operating procedures (including an ability to recreate records evidencing Pool Receivables and related Contracts in the event of the destruction of the originals thereof), and keep and maintain (or cause the Servicer to 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 records adequate to permit the daily identification of each Pool Receivable and all Collections of and adjustments to each existing Pool Receivable).
(mm)
Change in Payment Instructions to Obligors
. The Seller shall not (and shall not permit the Servicer or any Sub-Servicer to) add, replace or terminate any Lock-Box Account (or any related Lock-Box) or make any change in its (or their) instructions to the Obligors regarding payments to be made to the Lock-Box Accounts (or any related Lock-Box), other than any instruction to remit payments to a different Lock-Box Account (or any related Lock-Box) unless the Administrator shall have received (i) prior written notice of such addition, termination or change and (ii) signed and acknowledged Lock Box Agreements with respect to such new Lock Box Accounts (or any related lock box or post office box), and the Administrator shall have consented to such change in writing.
(nn)
Ownership Interest, Etc.
The Seller shall (and shall cause the Servicer to), at its expense, take all action necessary or reasonably desirable to establish and maintain a valid and enforceable undivided percentage ownership or security interest, to the extent of the Purchased Interest, in the Pool Receivables, the Related Security and Collections with respect thereto, and a first priority perfected security interest in the Pool Assets, in each case free and clear of any Adverse Claim, in favor of the Administrator (on behalf of the Purchasers), including taking such action to perfect, protect or more fully evidence the interest of the Administrator (on behalf of the Purchasers) as the Administrator or any Purchaser may reasonably request.
(oo)
Certain Agreements
. Without the prior written consent of the Administrator and the Majority Purchaser Agents, the Seller will not (and will not permit the Originators to) amend, modify, waive, revoke or terminate any Transaction Document to which it is a party or any provision of the Seller’s organizational documents which requires the consent of the “Independent Director” (as such term is used in the Seller’s Certificate of Incorporation and By-Laws).
(pp)
Restricted Payments
. (I) Except pursuant to
clause (ii)
below, the Seller will 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 Debt, (D) lend or advance any funds or (E) repay any loans or advances to, for or from any of its Affiliates (the amounts described in
clauses (A)
through
(E)
being referred to as “
Restricted Payments
”).
(i)
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 in one or more of the following ways: (A) the Seller may make cash payments (including prepayments) on the Subordinated Notes in accordance with their respective terms (it being understood that the foregoing shall not restrict any adjustment to the balance of any Subordinated Note pursuant to
Sections 3.2
or
3.3
of the Purchase and Sale Agreement as a result of the issuance or expiration of any Letter of Credit), and (B) the Seller may declare and pay dividends if, both immediately before and immediately after giving effect thereto, the Seller’s Net Worth is equal to or greater than the Required Capital Amount.
(ii)
The Seller may make Restricted Payments only out of the funds, if any, it receives pursuant to
Sections 1.4(b)(ii)
and
(iv)
and
1.4(d)
of this Agreement. Furthermore, the Seller shall not pay, make or declare any Restricted Payment (including any dividend) if, after giving effect thereto, any Termination Event or Unmatured Termination Event shall have occurred and be continuing.
(qq)
Other Business
. The Seller will not: (i) engage in any business other than the transactions contemplated by the Transaction Documents, (ii) create, incur or permit to exist any Debt of any kind (or cause or permit to be issued for its account any letters of credit (excluding, for the avoidance of doubt, Letters of Credit issued hereunder) or bankers’ acceptances) other than pursuant to this Agreement or the Subordinated Notes, or (iii) form any Subsidiary or make any investments in any other Person.
(rr)
Use of Seller’s Share of Collections
. The Seller shall apply the Seller’s Share of Collections to make payments in the following order of priority: (i) the payment of its expenses (including all obligations payable to the Purchasers, Purchaser Agents and the Administrator under this Agreement and under the Fee Letter), (ii) the payment of accrued and unpaid interest on the Subordinated Notes and (iii) other legal and valid purposes.
(ss)
Further Assurances; Change in Name or Jurisdiction of Origination, etc.
(i) The Seller hereby authorizes and hereby agrees from time to time, at its own expense, promptly to execute (if necessary) and deliver all further instruments and documents, and to take all further actions, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or more fully evidence the purchases or issuances made under this Agreement and/or security interest granted pursuant to this Agreement or any other Transaction Document, or to enable the Administrator (on behalf of the Purchasers) to exercise and enforce the Purchasers’ rights and remedies under this Agreement and any other Transaction Document. Without limiting the foregoing, the Seller hereby authorizes, and will, upon the request of the Administrator, at the Seller’s own expense, execute (if necessary) and file such financing or continuation statements, or amendments thereto, and such other instruments and documents, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or evidence any of the foregoing.
(i)
The Seller authorizes the Administrator to file financing or continuation statements, and amendments thereto and assignments thereof, relating to the Receivables and the Related Security, the related Contracts and the Collections with respect thereto and the other collateral subject to a lien under any Transaction Document without the signature of the Seller. A photocopy or other reproduction of this Agreement shall be sufficient as a financing statement where permitted by law.
(ii)
The Seller shall at all times be organized under the laws of the State of Delaware and shall not take any action to change its jurisdiction of organization.
(iii)
The Seller will not change its name, location, identity or corporate structure unless (x) the Seller, at its own expense, shall have taken all action necessary or appropriate to perfect or maintain the perfection of the lien under this Agreement (including, without limitation, the filing of all financing statements and the taking of such other action as the Administrator may request in connection with such change or relocation), and (y) if requested by the Administrator, the Seller shall cause to be delivered to the Administrator, an opinion, in form and substance satisfactory to the Administrator as to such UCC perfection and priority matters as such Person may request at such time.
(tt)
OFAC
. The Seller has not used and will not use the proceeds of any Receivable or any Purchase hereunder to fund any operations in, finance any investments or activities in or make any payments to, a Sanctioned Person or a Sanctioned Country.
(uu)
Transaction Information
. None of the Seller, any Affiliate of the Seller or any third party with which the Seller or any Affiliate thereof has contracted, shall deliver, in writing or orally, to any Rating Agency, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and will not participate in any oral communications with respect to Transaction Information with any Rating Agency without the participation of such Purchaser Agent.
(vv)
Seller’s Net Worth
. The Seller shall not permit the Seller’s Net Worth to be less than the Required Capital Amount.
2.
Covenants of the Servicer
. At all times from the Closing Date until the Final Payout Date:
(n)
Financial Reporting
. The Servicer will maintain a system of accounting established and administered in accordance with generally accepted accounting principles as in effect in the appropriate jurisdiction, and the Servicer shall furnish to the Administrator and each Purchaser Agent:
(i)
Compliance Certificates
.(a) A compliance certificate promptly upon completion of the annual report of Meritor and in no event later than 105 days after the close of Meritor’s fiscal year, in form and substance substantially similar to
Annex D
signed by its chief accounting officer or treasurer solely in their capacities as officers of Meritor stating that no Termination Event or Unmatured Termination Event has occurred and is continuing, or if any Termination Event or Unmatured Termination Event has occurred and is continuing, stating the nature and status thereof, and (b) within 55 days after the close of each fiscal quarter of Meritor, a compliance certificate in form and substance substantially similar to
Annex D
.
(ii)
Information Packages
. (A) As soon as available and in any event not later than two (2) Business Days prior to each Monthly Settlement Date, a Monthly Information Package as of the most recently completed Fiscal Month, and (B) on each Friday of each week (or, if such day is not a Business Day, on the following Business Day), a Weekly Information Package.
(iii)
Other Information
. Such other information (including non-financial information) as the Administrator or any Purchaser Agent may from time to time reasonably request, including any information available to the Seller, Servicer or Originator as the Administrator or any Purchaser Agent may reasonably request.
(o)
Notices
. The Servicer will notify the Administrator and each Purchaser Agent in writing of any of the following events promptly upon (but in no event later than three (3) Business Days after) a financial or other officer learning of the occurrence thereof, with such notice describing the same, and if applicable, the steps being taken by the Person(s) affected with respect thereto:
(i)
Notice of Termination Events or Unmatured Termination Events
. A statement of the chief financial officer or chief accounting officer of the Servicer setting forth details of any Termination Event or Unmatured Termination Event that is continuing and the action which the Servicer proposes to take with respect thereto.
(ii)
Representations and Warranties
. The failure of any representation or warranty with respect to the Pool Receivables to be true in any material respect when made.
(iii)
Litigation
. The institution of any litigation, arbitration proceeding or governmental proceeding which could reasonably be expected to have a Material Adverse Effect.
(iv)
Adverse Claim
.
(A) Any Person shall obtain an Adverse Claim upon the Pool Receivables or Collections with respect thereto, (B) any Person other than the Seller, the Servicer or the Administrator shall obtain any rights or direct any action with respect to any Lock-Box Account (or related Lock-Box) or (C) any Obligor shall receive any change in payment instructions with respect to Pool Receivable(s) from a Person other than the Servicer or the Administrator.
(v)
Name Changes
. At least thirty (30) days before any change in any Originator’s or 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.
(vi)
Material Adverse Change
. A material adverse change in the business, operations, property or financial or other condition of any Originator, the Servicer or the Seller.
(p)
Conduct of Business
. The Servicer will carry on and conduct its business in substantially the same manner and in substantially the same fields of enterprise as it is presently conducted (provided that the foregoing shall not prohibit any change in the Servicer’s business that could not reasonably be expected to have a Material Adverse Effect), and will do all things necessary to remain duly incorporated, validly existing and in good standing as a domestic corporation in its jurisdiction of incorporation and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted if the failure to have such authority could reasonably be expected to have a Material Adverse Effect.
(q)
Compliance with Laws
. The Servicer will comply with all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to which it may be subject if the failure to comply could reasonably be expected to have a Material Adverse Effect.
(r)
Furnishing of Information and Inspection of Receivables
. The Servicer will furnish to the Administrator from time to time such information with respect to the Pool Receivables as the Administrator may reasonably request. The Servicer will, at the Servicer’s expense, during regular business hours with prior written notice, (i) permit the Administrator or its agents or representatives to (A) examine and make copies of and abstracts from all books and records relating to the Pool Receivables or other Pool Assets, (B) to visit the offices and properties of the Servicer for the purpose of examining such books and records, and (C) discuss matters relating to the Pool Receivables, other Pool Assets or the Servicer’s performance hereunder or under the other Transaction Documents to which it is a party with any of the officers, directors, employees or independent public accountants of the Servicer (provided that representatives of the Servicer are present during such discussions) having knowledge of such matters and (ii) without limiting the provisions of
clause (i)
above, during regular business hours, at the Servicer’s expense, upon prior written notice from the Administrator, permit certified public accountants or other auditors acceptable to the Administrator to conduct, a review of its books and records with respect to such Receivables;
provided
, that the Servicer shall be required to reimburse the Administrator for only one (1) such audit in any twelve-month period unless a Termination Event has occurred and is continuing.
(s)
Payments on Receivables, Lock-Box Accounts
. The Servicer will at all times, instruct all Obligors to deliver payments on the Pool Receivables to a Lock-Box Account or a Lock-Box. The Servicer will, at all times, maintain such books and records necessary to identify Collections received from time to time on Receivables and to segregate such Collections from other property of the Servicer and the Originators (including without limitation Other Navistar Collections). If any payments on the Pool Receivables or other Collections are received by the Seller, the Servicer or an Originator, it shall hold such payments in trust for the benefit of the Administrator, the Purchaser Agents and the Purchasers and promptly (but in any event within one Business Day after receipt) remit such funds into a Lock-Box Account. The Servicer will cause each Lock-Box Bank to comply with the terms of each applicable Lock-Box Agreement. Except for Other Navistar Collections, the Servicer shall not permit funds other than Collections on Pool Receivables and other Pool Assets to be deposited into any Lock-Box Account. If such funds are nevertheless deposited into any Lock-Box Account, the Servicer will within two Business Days identify and transfer such funds, and all funds constituting Other Navistar Collections to the appropriate Person entitled to such funds. Except with respect to Other Navistar Collections, the Servicer will not, and will not permit any other Person to commingle Collections or other funds to which the Administrator, any Purchaser Agent or any Purchaser is entitled with any other funds, except cash concentration accounts maintained by Meritor, prior to segregation pursuant to
Section 1.4
of the Agreement. The Servicer shall only add, a Lock-Box Account (or the related Lock-Box), or a Lock-Box Bank to those listed on
Schedule II
to this Agreement, if the Administrator has received notice of such addition and an executed and acknowledged copy of a Lock-Box Agreement in form and substance acceptable to the Administrator from any such new Lock-Box Bank. The Servicer shall only terminate a Lock-Box Bank or close a Lock-Box Account (or the related Lock-Box) with the prior written consent of the Administrator.
(t)
Extension or Amendment of Pool Receivables
. Except as otherwise permitted in
Section 4.2
of this Agreement, the Servicer will not alter the delinquency status or adjust the Outstanding Balance or otherwise modify the terms of any Pool Receivable in any material respect, or amend, modify or waive, in any material respect any term or condition of any related Contract (which term or condition relates to payments under, or the enforcement of, such Contract). The Servicer shall at its expense, timely and fully perform and comply with all provisions, covenants and other promises required to be observed by it under the Contracts related to the Pool Receivables, and timely and fully comply with the Credit and Collection Policy with regard to each Pool Receivable and the related Contract (which term or condition relates to payments under, or the enforcement of, such Contract).
(u)
Change in Credit and Collection Policy
. The Servicer will not make any material change in the Credit and Collection Policy without the prior written consent of the Administrator and the Majority Purchaser Agents.
(v)
Records
. The Servicer will maintain and implement administrative and operating procedures (including an ability to recreate records evidencing Pool Receivables and related Contracts 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 records adequate to permit the daily identification of each Pool Receivable and all Collections of and adjustments to each existing Pool Receivable).
(w)
Change in Payment Instructions to Obligors
. The Servicer shall not add, replace or terminate any of the Lock-Box Accounts (or any related Lock-Box) listed in
Schedule II
hereto or make any change in its instructions to the Obligors regarding payments to be made to the Lock-Box Accounts (or any related Lock-Box), unless the Administrator shall have received (i) prior written notice of such addition, termination or change and (ii) signed and acknowledged Lock Box Agreements with respect to such new Lock-Box Accounts (or any related Lock-Box) and the Administrator shall have consented to such change in writing.
(x)
Ownership Interest, Etc.
The Servicer shall, at its expense, take all action necessary or reasonably desirable to establish and maintain a valid and enforceable undivided percentage ownership or security interest, to the extent of the Purchased Interest, in the Pool Receivables, the Related Security and Collections with respect thereto, and a first priority perfected security interest in the Pool Assets, in each case free and clear of any Adverse Claim in favor of the Administrator (on behalf of the Purchasers), including taking such action to perfect, protect or more fully evidence the interest of the Administrator (on behalf of the Purchasers) as the Administrator may reasonably request. In order to evidence the interests of the Administrator under this Agreement, the Servicer shall, from time to time take such action, or execute and deliver such instruments as may be necessary (including, without limitation, such actions as are reasonably requested by the Administrator) to maintain and perfect, as a first-priority interest, the Administrator’s security interest in the Receivables, Related Security and Collections. The Servicer shall, from time to time and within the time limits established by law, prepare and present to the Administrator for the Administrator’s authorization and approval, all financing statements, amendments, continuations or initial financing statements in lieu of a continuation statement, or other filings necessary to continue, maintain and perfect the Administrator’s security interest as a first-priority interest. The Administrator’s approval of such filings shall authorize the Servicer to file such financing statements under the UCC without the signature of the Seller, any Originator or the Administrator where allowed by applicable law. Notwithstanding anything else in the Transaction Documents to the contrary, the Servicer shall not have any authority to file a termination, partial termination, release, partial release, or any amendment that deletes the name of a debtor or excludes collateral of any such financing statements filed in connection with the Transaction Documents, without the prior written consent of the Administrator.
(y)
Further Assurances; Change in Name or Jurisdiction of Origination, etc.
The Servicer hereby authorizes and hereby agrees from time to time, at its own expense, promptly to execute (if necessary) and deliver all further instruments and documents, and to take all further actions, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or more fully evidence the purchases or issuances made under this Agreement and/or security interest granted pursuant to this Agreement or any other Transaction Document, or to enable the Administrator (on behalf of the Purchasers) to exercise and enforce their respective rights and remedies under this Agreement or any other Transaction Document. Without limiting the foregoing, the Servicer hereby authorizes, and will, upon the request of the Administrator, at the Servicer’s own expense, execute (if necessary) and file such financing or continuation statements, or amendments thereto, and such other instruments and documents, that may be necessary or desirable, or that the Administrator may reasonably request, to perfect, protect or evidence any of the foregoing.
(z)
Transaction Information
. None of the Servicer, any Affiliate of the Servicer or any third party contracted by the Servicer or any Affiliate thereof, shall deliver, in writing or orally, to any Rating Agency, any Transaction Information without providing such Transaction Information to the applicable Purchaser Agent prior to delivery to such Rating Agency and will not participate in any oral communications with respect to Transaction Information with any Rating Agency without the participation of such Purchaser Agent.
(aa)
Priority Debt Ratio
. Meritor shall not permit its Priority Debt Ratio, calculated on a consolidated basis for Meritor and its Subsidiaries, to exceed (i) 2.50 to 1.00 as of the last day of any fiscal quarter commencing with the first fiscal quarter ending on or after the Closing Date through and including the fiscal quarter ending on or about September 30, 2012, (ii) 2.25 to 1.00 as of the last day of any fiscal quarter commencing with the fiscal quarter ending on or about December 31, 2012 through and including the fiscal quarter ending on or about September 30, 2013, and (iii) 2.00 to 1.00 as of the last day of each fiscal quarter thereafter.
3.
Separate Existence
. Each of the Seller and the Servicer hereby acknowledges that the Purchasers, the Purchaser Agents and the Administrator are entering into the transactions contemplated by this Agreement and the other Transaction Documents in reliance upon the Seller’s identity as a legal entity separate from any Originator, the Servicer, Meritor and their Affiliates. Therefore, from and after the Closing Date, each of the Seller and Servicer shall take all steps specifically required by this Agreement or reasonably required by the Administrator, any Purchaser Agent or any Purchaser 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 Meritor, the Originators, the Servicer and any other Person, and is not a division of Meritor, the Originators, the Servicer, its Affiliates or any other Person. Without limiting the generality of the foregoing and in addition to and consistent with the other covenants set forth herein, each of the Seller and Meritor shall take such actions as shall be required in order that:
(e)
The Seller will be a special purpose corporation whose primary activities are restricted in its Certificate of Incorporation to: (i) purchasing or otherwise acquiring from the Originators, owning, holding, granting security interests or selling interests in Pool Assets, (ii) entering into agreements for the selling, servicing and financing of the Receivables Pool (including the Transaction Documents), and (iii) conducting such other activities as it deems necessary or appropriate to carry out its primary activities;
(f)
The Seller shall not engage in any business or activity except as set forth in this Agreement nor, incur any indebtedness or liability other than as expressly permitted by the Transaction Documents;
(g)
Not fewer than one member of the Seller’s board of directors (the “
Independent Director
”) shall be a natural person who has never been, and shall at no time be, an equityholder, director, officer, manager, employee or associate, or any relative of the foregoing, of any member of the Parent Group (as hereinafter defined) (other than the corporation and any other bankruptcy-remote special purpose entity formed for the sole purpose of securitizing, or facilitating the securitization of, financial assets of any member or members of the Parent Group). For purposes of this
clause (c)
, “
Parent Group
” shall mean (i) Meritor, (ii) each person that directly or indirectly, owns or controls, whether beneficially, or as a trustee, guardian or other fiduciary, five percent (5%) or more of the membership interests in Meritor, (iii) each person that controls, is controlled by or is under common control with Meritor, and (iv) each of such person’s officers, directors, managers, joint venturers and partners. For the purposes of this definition, “control” of a person means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through the ownership of voting securities, by contract or otherwise. A person shall be deemed to be an “associate” of (A) a corporation or organization of which such person is an officer, director, partner or manager or is, directly or indirectly, the beneficial owner of ten percent (10%) or more of any class of equity securities, (B) any trust or other estate in which such person serves as trustee or in a similar capacity, and (C) any relative or spouse of a person described in
clause (A)
or
(B)
of this sentence, or any relative of such spouse.
In addition to the foregoing requirements, the director designated as the Seller’s Independent Director shall (A) have prior experience as an independent director for a corporation or limited liability company whose charter documents required the unanimous consent of all independent directors thereof before such corporation or limited liability company could consent to the institution of bankruptcy or insolvency proceedings against it or could file a petition seeking relief under any applicable federal or state law relating to bankruptcy; and (B) have at least three years of employment experience with one or more entities that provide, in the ordinary course of their respective businesses, advisory, management or placement services to issuers of securitization or structured finance instruments, agreements or securities.
The Seller shall (A) give written notice to the Administrator of the election or appointment, or proposed election or appointment, of a new Independent Director of the Seller, which notice shall be given not later than 5 days prior to the date such appointment or election would be effective (except when such election or appointment is necessary to fill a vacancy caused by the death, disability, or incapacity of the existing Independent Director, or the failure of such Independent Director to satisfy the criteria for an Independent Director set forth in this
clause (c)
, in which case the Seller shall provide written notice of such election or appointment within one business day), and (B) with any such written notice, certify to the Administrator that the Independent Director satis
f
ies the criteria for an Independent Director set forth in this
clause (c)
.
The Seller’s Certificate of Incorporation shall provide that: (A) the Seller’s board of directors shall not approve, or take any other action to cause the filing of, a voluntary bankruptcy petition with respect to the Seller unless the Independent Director shall approve the taking of such action in writing before the taking of such action, and (B) such provision and each other provision requiring an Independent Director cannot be amended without the prior written consent of the Independent Director;
(h)
The Independent Director shall not at any time serve as a trustee in bankruptcy for the Seller, Meritor, any Originator, the Servicer or any of their respective Affiliates;
(i)
The Seller shall maintain its organizational documents in conformity with this Agreement, such that it does not amend, restate, supplement or otherwise modify its ability to comply with the terms and provisions of any of the Transaction Documents, including, without limitation,
paragraph (k)
of
Exhibit V
;
(j)
The Seller shall conduct its affairs strictly in accordance with its organizational documents and observe all necessary, appropriate and customary company formalities, including, but not limited to, holding all regular and special members’ and board of directors’ meetings appropriate to authorize all corporate action, keeping separate and accurate minutes of its meetings, passing all resolutions or consents necessary to authorize actions taken or to be taken, and maintaining accurate and separate books, records and accounts, including, but not limited to, payroll and intercompany transaction accounts;
(k)
Any employee, consultant or agent of the Seller will be compensated from the Seller’s funds for services provided to the Seller, and to the extent that Seller shares the same officers or other employees as Meritor (or any other Affiliate thereof), the salaries and expenses relating to providing benefits to such officers and other employees shall be fairly allocated among such entities, and each such entity shall bear its fair share of the salary and benefit costs associated with such common officers and employees. The Seller will not engage any agents other than its attorneys, auditors and other professionals, and a servicer and any other agent contemplated by the Transaction Documents for the Receivables Pool, which servicer will be fully compensated for its services by payment of the Servicing Fee;
(l)
The Seller will contract with the Servicer to perform for the Seller all operations required on a daily basis to service the Receivables Pool. The Seller will not incur any indirect or overhead expenses for items shared with Meritor (or any other Affiliate thereof) that are not reflected in the Servicing Fee. To the extent, if any, that the Seller (or any Affiliate thereof) shares items of expenses not reflected in the Servicing 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 Meritor shall pay all expenses relating to the preparation, negotiation, execution and delivery of the Transaction Documents, including legal, agency and other fees;
(m)
The Seller’s operating expenses will not be paid by Meritor, any Originator or any Affiliate thereof;
(n)
The Seller will have its own separate stationery;
(o)
The Seller’s books and records will be maintained separately from those of Meritor and any other Affiliate thereof and in a manner such that it will not be difficult or costly to segregate, ascertain or otherwise identify the assets and liabilities of Seller;
(p)
All financial statements of Meritor or any Affiliate thereof that are consolidated to include the Seller will disclose that (i) the Seller’s sole business consists of the purchase or acceptance through capital contributions of the Receivables and Related Rights from the Originators and the subsequent retransfer of or granting of a security interest in such Receivables and Related Rights to certain purchasers party to this Agreement, (ii) the Seller is a separate legal entity with its own separate creditors who will be entitled, upon its liquidation, to be satisfied out of the Seller’s assets prior to any assets or value in the Seller becoming available to the Seller’s equity holders and (iii) the assets of the Seller are not available to pay creditors of Meritor or any other Affiliates of Meritor or the Originators;
(q)
The Seller’s assets will be maintained in a manner that facilitates their identification and segregation from those of Meritor or any Affiliates thereof;
(r)
The Seller will strictly observe corporate formalities in its dealings with Meritor or any Affiliates thereof, and funds or other assets of the Seller will not be commingled with those of Meritor or any Affiliates thereof except as permitted by this Agreement in connection with servicing the Pool Receivables. The Seller shall not maintain joint bank accounts or other depository accounts to which Meritor or any Affiliate thereof (other than Meritor in its capacity as the Servicer) has independent access. The Seller is not named, and has not entered into any agreement to be named, directly or indirectly, as a direct or contingent beneficiary or loss payee on any insurance policy with respect to any loss relating to the property of Meritor or any Subsidiaries or other Affiliates thereof. The Seller will pay to the appropriate Affiliate 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 such Affiliate;
(s)
The Seller will maintain arm’s-length relationships with Meritor (and any Affiliates thereof). Any Person that renders or otherwise furnishes services to the Seller will be compensated by the Seller at market rates for such services it renders or otherwise furnishes to the Seller. Neither the Seller on the one hand, nor Meritor, on the other hand, 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. The Seller and Meritor will immediately correct any known misrepresentation with respect to the foregoing, and they will not operate or purport to operate as an integrated single economic unit with respect to each other or in their dealing with any other entity; and
(t)
To the extent that Seller and Meritor have offices in the same location, there shall be a fair and appropriate allocation of overhead costs between them, and Seller shall bear its fair share of such expenses, which may be paid through the Servicing Fee or otherwise.
EXHIBIT V
TERMINATION EVENTS
Each of the following shall be a “
Termination Event
”:
(a)
(i) the Seller, any Originator, the Performance Guarantor or the Servicer shall fail to perform or observe any term, covenant or agreement under the Agreement or any other Transaction Document (other than any such failure which would constitute a Termination Event under clause (ii) of this
paragraph (a)
or which is specifically dealt with in any of
paragraphs (b)
through
(o)
below), and such failure, solely to the extent capable of cure, shall continue for fifteen (15) Business Days, (ii) the Seller, any Originator, the Performance Guarantor or the Servicer shall fail to make when due (x) any payment or deposit to be made by it under the Agreement any other Transaction Document and such failure shall continue unremedied for two (2) Business Days or (iii) Meritor shall resign as Servicer, and no successor Servicer reasonably satisfactory to the Administrator shall have been appointed;
(b)
any representation or warranty made or deemed made by the Seller, the Performance Guarantor, any Originator or the Servicer (or any of their respective officers) under or in connection with the Agreement or any other Transaction Document or any information or report delivered by the Seller, any Originator or the Servicer pursuant to the Agreement or any other Transaction Document, shall prove to have been incorrect or untrue in any material respect when made or deemed made or delivered;
provided
that such circumstance shall not constitute a Termination Event if such representation or warranty, or such information or report, is part of an Information Package, and is corrected promptly (but not later than fifteen (15) days) after the Seller, the Performance Guarantor, any Originator or the Servicer has knowledge or receives notice thereof; and
provided further
that no breach of a representation or warranty set forth in
Section 1(j)
or
3(a)
of
Exhibit III
to this Agreement shall constitute a Termination Event pursuant to this
clause (b)
if the Seller has paid the amount required to be paid under
Section 1.4(e)(ii)
in respect thereof;
(c)
the Seller or the Servicer shall fail to deliver the Information Package pursuant to the Agreement, and such failure shall remain unremedied for two (2) Business Days;
(d)
the Agreement or any purchase or reinvestment pursuant to the Agreement shall for any reason: (i) cease to create, or the Purchased Interest shall for any reason cease to be, a valid and enforceable first priority perfected undivided percentage ownership or security interest to the extent of the Purchased Interest in each Pool Receivable, the Related Security and Collections with respect thereto, free and clear of any Adverse Claim, or (ii) cease to create with respect to the Pool Assets, or the interest of the Administrator with respect to such Pool Assets shall cease to be, a valid and enforceable first priority perfected security interest, free and clear of any Adverse Claim;
(e)
the Seller, the Performance Guarantor, the Servicer or any Originator 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 Performance Guarantor, the Servicer or any Originator seeking to adjudicate it as 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 60 days, or any of the actions sought in such proceeding (including 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 Performance Guarantor, the Servicer or any Originator shall take any corporate or organizational action to authorize any of the actions set forth above in this paragraph;
(f)
(i) the average for three consecutive Fiscal Months of: (A) the Default Ratio shall exceed 3.00%, (B) the Delinquency Ratio shall exceed 6.00% or (C) the Dilution Ratio shall exceed 8.50% or (ii) the Days’ Sales Outstanding shall exceed 45 days;
(g)
a Change in Control shall occur;
(h)
(i) the sum of (A) the Aggregate Capital,
plus
the Adjusted LC Participation Amount,
plus
(B) the Total Reserves exceeds (ii) the sum of (A) Net Receivables Pool Balance at such time,
plus
(B) the Purchasers’ Share of the amount of Collections then on deposit in the Lock-Box Accounts (other than amounts set aside therein representing Discount and fees), and such circumstance shall not have been cured within two (2) Business Days;
(i)
(A) the Performance Guarantor or any of its Subsidiaries fail to pay any principal of or premium or interest on any Material Debt when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), which failure continues after the applicable grace period, if any, specified in the related Material Debt Agreement (whether or not such failure is waived under any related Material Debt Agreement);
(B) any other event or condition (other than the Permitted 2026 Put or an event described in
paragraph (o)
below) occurs or exists under, and continues to exist after the applicable grace period, in any, specified in, any Material Debt Agreement, (x) which event or condition gives the applicable debtholders, lenders or counterparties the right (whether or not acted upon) to (I) accelerate the maturity of the related Material Debt or (II) cause the early termination of any commitment of any such debtholder, lender or counterparty under the related Material Debt Agreements or the transactions contemplated by the related Material Debt Agreements, and (y) solely in the case of an event or condition arising and continuing under the Meritor Credit Agreement while PNC is a party thereto, which event or condition does not cease to exist, or is not cured or waived in accordance with the terms of the Meritor Credit Agreement within a period of thirty (30) days after the later of the date on which such event or condition occurs or the expiration of the applicable grade period (if any);
(C) any Material Debt is declared to be due and payable, or required to be prepaid (other than by a regularly scheduled required prepayment or pursuant to the Permitted 2026 Put), redeemed, purchased or defeased (except as a result of the exercise of any right or option of the Performance Guarantor or the Subsidiary, as applicable), or an offer to repay, redeem, purchase or defease such Material Debt is required to be made (except as a result of the exercise of any right or option of the Performance Guarantor or the Subsidiary, as applicable), in each case before the stated maturity thereof; or
(D) any commitment of any debtholder, lender or counterparty under a Material Debt Agreement or any transaction contemplated by a Material Debt Agreement is, in either case, terminated by the debtholder, lender or counterparty prior to the scheduled termination thereof (except as a result of (i) breach or default by such debtholder, lender, or counterparty, or (ii) the exercise of any right or option of the Performance Guarantor or the Subsidiary, as applicable);
(j)
the Performance Guarantor shall fail to perform any of its obligations under the Performance Guaranty;
(k)
the Seller shall fail (x) at any time (other than for fifteen (15) Business Days following notice of the death or resignation of any Independent Director) to have an Independent Director who satisfies each requirement and qualification specified in
Section 3(c)
of
Exhibit IV
to the Agreement for Independent Directors, on the Seller’s board of directors or (y) to timely notify the Administrator of any replacement or appointment of any director that is to serve as an Independent Director on the Seller’s board of directors as required pursuant to such
Section 3(c)
;
(l)
any Letter of Credit is drawn upon and is not fully reimbursed by the Seller, or funded by Participation Advances as required pursuant to
Section 1.14
;
(m)
any material provision of this Agreement or any other Transaction Document shall cease to be in full force and effect or any of the Seller, the Servicer, Meritor or any Originator shall so state in writing;
(n)
one or more judgments or decrees shall be entered against the Seller, Meritor or any Subsidiary of Meritor involving in the aggregate a liability (not paid or to the extent not covered by a reputable and solvent insurance company) and such judgments and decrees either shall be final and non-appealable or shall not be vacated, discharged or stayed or bonded pending appeal for any period of 30 consecutive days, and the aggregate amount of all such judgments equals or exceeds $35,000,000 (or solely with respect to the Seller, $12,500); or
(o)
Meritor fails to perform the covenant set forth in
Section 2(n)
of
Exhibit IV
;
provided
,
however
, such event or circumstance shall not constitute a Termination Event if the following conditions are met with respect thereto: (A) at the time when such event occurs, the Meritor Credit Agreement requires Meritor to cause its Priority Debt Ratio (as defined herein) not to exceed the ratios set forth in
Section 2(n)
of
Exhibit IV
and an event of default occurs under the Meritor Credit Agreement as a result of Meritor's failure to perform such covenant, (B) such event of default is waived under the Meritor Credit Agreement in accordance with the terms thereof within 30 days of the occurrence of such event of default, and (C) at the time such waiver is granted under the Meritor Credit Agreement, PNC is a party to the Meritor Credit Agreement.
SCHEDULE I
CREDIT AND COLLECTION POLICY
(Attached)
701648899 12403015
Schedule I
SCHEDULE II
LOCK-BOX BANKS, LOCK-BOXES, COLLECTION
ACCOUNT BANKS AND ACCOUNTS
|
|
|
|
|
|
|
Lock-Box Banks
|
Lock-Boxes
|
Lock-Box Accounts
|
|
JPMorgan Chase Bank, N.A.
|
[Redacted]
|
[Redacted]
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
701648899 12403015
Schedule II
SCHEDULE III
ACTIONS AND PROCEEDINGS
None.
701648899 12403015
Schedule III
SCHEDULE IV
PURCHASER GROUPS AND MAXIMUM COMMITMENTS
(as of the Closing Date)
|
|
|
|
|
|
|
Purchaser Group of Market Street Funding LLC
|
|
Party
|
Capacity
|
Maximum Commitment
|
|
Market Street Funding LLC
|
Conduit Purchaser
|
N/A
|
|
PNC Bank, National Association
|
Related Committed Purchaser
|
$100,000,000
|
|
PNC Bank, National Association
|
LC Participant
|
$100,000,000
|
|
PNC Bank, National Association
|
LC Bank
|
N/A
|
|
PNC Bank, National Association
|
Purchaser Agent
|
N/A
|
701648899 12403015
Schedule IV
SCHEDULE V
PAYMENT INSTRUCTIONS
Purchase Account
|
|
|
|
|
|
Beneficiary:
|
ArvinMeritor Receivables Corporation
|
|
Bank:
|
JPMorgan Chase bank
|
|
Account Number:
|
[Redacted]
|
|
ABA Number:
|
[Redacted]
|
701648899 12403015
Schedule V
SCHEDULE VI
EXCLUDED OBLIGORS
Mack Trucks, Inc.
Volvo Group North America, Inc.
Volvo Construction Equipment N.A.
701648899 12403015
Schedule VI
ANNEX A
to Receivables Purchase Agreement
FORMS OF INFORMATION PACKAGES
With respect to Monthly Information Packages, see Annex A1.
With respect to Weekly Information Packages, see Annex A2.
701648899 12403015
Annex A
ANNEX A1
to Receivables Purchase Agreement
FORM OF MONTHLY INFORMATION PACKAGE
(Attached)
701648899 12403015
Annex A1
ANNEX A2
to Receivables Purchase Agreement
FORM OF WEEKLY INFORMATION PACKAGE
(Attached)
701648899 12403015
Annex A2
ANNEX B
to Receivables Purchase Agreement
FORM OF PURCHASE NOTICE
____________________, 2011
PNC Bank, National Association
One PNC Plaza, 26
th
Floor
249 Fifth Avenue
Pittsburgh, PA 15222-2707
[Each other Purchaser Agent]
Ladies and Gentlemen:
Reference is hereby made to the Receivables Purchase Agreement, dated as of June 18, 2012 (as amended, restated, supplemented or otherwise modified, the “
Receivables Purchase Agreement
”), among ArvinMeritor Receivables Corporation, (“
Seller
”), Meritor, Inc., as Servicer, the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto, PNC Bank, National Association, as the issuer of letters of credit thereunder (in such capacity, the “
LC Bank
”), and PNC Bank, National Association, as administrator (in such capacity, the “
Administrator
”). Capitalized terms used in this Purchase Notice and not otherwise defined herein shall have the meanings assigned thereto in the Receivables Purchase Agreement.
[This letter constitutes a Purchase Notice pursuant to
Section 1.2(a)
of the Receivables Purchase Agreement. Seller desires to sell an undivided percentage interest in a pool of receivables on ____________________, [201_____], for a purchase price of $____________________ (of which $_______ will be funded by Market Street Funding LLC’s Purchaser Group. Subsequent to this Purchase, the Aggregate Capital will be $____________________.]
[This letter constitutes a notice pursuant to
Section 1.12(a)
of the Receivables Purchase Agreement. Seller desires that LC Bank issue a Letter of Credit with a face amount of $_____. Subsequent to this purchase, the LC Participation Amount will be $_______ and the Aggregate Capital will be $_____.]
Seller hereby represents and warrants as of the date hereof, and as of the date of such Purchase, as follows:
(i) the representations and warranties contained in
Exhibit III
of the Receivables Purchase Agreement are true and correct in all material respects on and as of such dates as though made on and as of such dates and shall be deemed to have been made on such dates (except for representations and warranties that apply solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date);
701648899 12403015
Annex B
(ii) no Termination Event or Unmatured Termination Event has occurred and is continuing, or would result from such purchase;
(iii) after giving effect to the purchase proposed hereby, the Aggregate Capital
plus
the LC Participation Amount shall not exceed the Purchase Limit, and the Purchased Interest shall not exceed 100%; and
(iv) the Facility Termination Date shall not have occurred.
701648899 12403015
Annex B
IN WITNESS WHEREOF, the undersigned has caused this Purchase Notice to be executed by its duly authorized officer as of the date first above written.
ARVINMERITOR RECEIVABLES CORPORATION
By:
Name:
Title:
701648899 12403015
Annex B
ANNEX C
to Receivables Purchase Agreement
FORM OF PAYDOWN NOTICE
____________________, 20_____
PNC Bank, National Association
One PNC Plaza, 26
th
Floor
249 Fifth Avenue
Pittsburgh, PA 15222-2707
[Each other Purchaser Agent]
Ladies and Gentlemen:
Reference is hereby made to the Receivables Purchase Agreement, dated as of June 18, 2012 (as amended, restated, supplemented or otherwise modified from time to time, the “
Receivables Purchase Agreement
”), among ArvinMeritor Receivables Corporation, as Seller, Meritor, Inc., as Servicer, the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto, PNC Bank, National Association, as the issuer of letters of credit thereunder (in such capacity, the “
LC Bank
”), and PNC Bank, National Association, as Administrator. Capitalized terms used in this paydown notice and not otherwise defined herein shall have the meanings assigned thereto in the Receivables Purchase Agreement.
This letter constitutes a Paydown Notice pursuant to
Section 1.4(f)(i)
of the Receivables Purchase Agreement. The Seller desires to reduce the Aggregate Capital on ________________________, _____ by the application of $____________________ (of which $________ will reduce Capital funded by Market Street Funding LLC’s Purchaser Group in cash to reduce Aggregate Capital by such amount. Subsequent to this paydown, the Aggregate Capital will be $________________.
IN WITNESS WHEREOF, the undersigned has caused this paydown notice to be executed by its duly authorized officer as of the date first above written.
ARVINMERITOR RECEIVABLES CORPORATION
By:
Name:
Title:
701648899 12403015
Annex C
ANNEX D
to Receivables Purchase Agreement
FORM OF COMPLIANCE CERTIFICATE
To: PNC Bank, National Association, as Administrator
[Each Purchaser Agent]
This Compliance Certificate is furnished pursuant to that certain Receivables Purchase Agreement, dated as of June 18, 2012 by and among ArvinMeritor Receivables Corporation (“
Seller
”), Meritor, Inc. (the “
Servicer
”), the various Conduit Purchasers, Related Committed Purchasers, LC Participants and Purchaser Agents from time to time parties thereto, PNC Bank, National Association, as the issuer of letters of credit thereunder (in such capacity, the “
LC Bank
”), and PNC Bank, National Association (the “
Administrator
”) (as amended, restated, supplemented or otherwise modified from time to time, the “
Agreement
”). Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to them in the Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected ____________________ of the Servicer.
2. I have reviewed the terms of the Agreement and I have made, or have caused to be made under my supervision, a detailed review of the transactions and condition of Seller during the accounting period covered by the attached financial statements.
3. The examinations described in
paragraph 2
did not disclose, and I have no knowledge of, the existence of any condition or event which constitutes a Termination Event or an Unmatured Termination Event, as each such term is defined under the Agreement, during or at the end of the accounting period covered by the attached financial statements or as of the date of this Certificate, except as set forth in
paragraph 4
below.
4. Described below are the exceptions, if any, to
paragraph 3
by listing, in detail, the nature of the condition or event, the period during which it has existed and the action which Seller or the Servicer has taken, is taking, or proposes to take with respect to each such condition or event:
701648899 12403015
Annex D
The foregoing certifications, together with the computations set forth in
Schedule I
hereto and the financial statements delivered with this Certificate in support hereof, are made and delivered this _____ day of ____________________, 20___.
MERITOR, INC.
By:
Name:
Title:
701648899 12403015
Annex D
ANNEX E
to Receivables Purchase Agreement
FORM OF LETTER OF CREDIT APPLICATION
(Attached)
701648899 12403015
Annex E
ANNEX F
FORM OF TRANSFER SUPPLEMENT
Dated as of [_______ __, 20__]
Section 1
.
Commitment assigned: $_________
Assignor’s remaining Commitment: $_________
Capital allocable to Commitment assigned: $_________
Assignor’s remaining Capital: $_________
Discount (if any) allocable to
Capital assigned: $_________
Discount(if any) allocable to Assignor’s
remaining Capital: $_________
Section 2
.
Effective Date of this Transfer Supplement: [__________]
Upon execution and delivery of this Transfer Supplement by transferee and [Seller] and the satisfaction of the other conditions to assignment specified in
Section 5.3(c)
of the Receivables Purchase Agreement (as defined below), from and after the effective date specified above, the transferee shall become a party to, and have the rights and obligations of a Related Committed Purchaser under, the Receivables Purchase Agreement, dated as of August __, 2011 (as amended, restated, supplemented or otherwise modified through the date hereof, the “
Receivables Purchase Agreement
”), among ArvinMeritor Receivables Corporation, as Seller, Meritor, Inc., as initial Servicer, the various Conduit Purchasers, Related Committed Purchasers, Purchaser Agents and LC Participants from time to time parties thereto, PNC Bank, National Association, as LC Bank, and PNC Bank, National Association, as Administrator.
701648899 12403015
Annex F
ASSIGNOR: [_________], as a Related Committed Purchaser
By:______________________
Name:
Title:
ASSIGNEE: [_________], as a Purchasing Related Committed Purchaser
By:___________________
Name:
Title:
[Address]
Accepted as of date first above
written:
[___________], as Purchaser Agent for
the [______] Purchaser Group
By:_________________________
Name:
Title:
[Consented to as of date first above written:
MERITOR, INC.
By:_________________________
Name:
Title: ]
701648899 12403015
Annex F