Exhibit 10.38

CONFORMED COPY

Form of
RECEIVABLES PURCHASE AGREEMENT
dated as of November 30, 2001,
as amended by
Amendment No. 1, dated August 29, 2003
Amendment No. 2, dated January 29, 2004
Amendment No. 3, dated August 30, 2004
Amendment No. 4, dated November 1, 2005
Amendment No. 5, dated April 24, 2006
Amendment No. 6, dated September 5, 2006
Amendment No. 7, dated April 23, 2009
Amendment No. 8, dated April 22, 2010
Amendment No. 9, dated August 26, 2010
Amendment No. 10, dated April 21, 2011
Amendment No. 11, dated April 19, 2012
Amendment No. 12, dated April 18, 2013
Amendment No. 13, dated October 1, 2013
Amendment No. 14, dated November 1, 2013
Amendment No. 15, dated October 31, 2014
Amendment No. 16, dated October 30, 2015
Amendment No. 17, dated October 28, 2016
Amendment No. 18, dated October 27, 2017

among

ENERGY SERVICES FUNDING CORPORATION

UGI ENERGY SERVICES, LLC

and

PNC BANK, NATIONAL ASSOCIATION

 
 
 

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This RECEIVABLES PURCHASE AGREEMENT (as amended, supplemented or otherwise
modified from time to time, this “Agreement”) is entered into as of November 30,
2001, among ENERGY SERVICES FUNDING CORPORATION, a Delaware corporation, as
seller (the “Seller”), UGI ENERGY SERVICES, LLC (as successor to UGI Energy
Services, Inc.), a Pennsylvania limited liability company (“UGI”), as initial
servicer (in such capacity, together with its successors and permitted assigns
in such capacity, the “Servicer”) and PNC BANK, NATIONAL ASSOCIATION, a national
banking association (“PNC”), as issuer (together with its successors and
permitted assigns, the “Issuer”) 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.
The Seller desires to sell, transfer and assign an undivided variable percentage
interest in a pool of receivables, and the Issuer desires to acquire such
undivided variable percentage interest, as such percentage interest shall be
adjusted from time to time based upon, in part, reinvestment payments that are
made by the Issuer.
In consideration of the mutual agreements, provisions and covenants contained
herein, the parties hereto agree as follows:
ARTICLE I
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1    Purchase Facility. (a) On the terms and conditions hereinafter
set forth, the Issuer hereby agrees to purchase, and make reinvestments of,
undivided percentage ownership interests with regard to the Purchased Interest
from the Seller from time to time from December 4, 2001 to the Facility
Termination Date. Under no circumstances shall the Issuer make any such purchase
or reinvestment if, after giving effect to such purchase or reinvestment, the
aggregate outstanding Capital of the Purchased Interest would exceed the
Purchase Limit.
(b)    The Seller may, upon at least 60 days’ written notice to the
Administrator, terminate the Purchase Facility provided in this Section 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;
provided, that, so long as the Credit Agreement is in effect, the Seller’s right
to terminate the Purchase Facility in whole pursuant to this Section 1.1(b) is
conditioned upon the Seller exercising its option to repurchase in full (but not
in part) the Purchased Interest in accordance with the terms of Section 5.14;
provided, further, 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 $20,000,000.
Section 1.2    Making Purchases. (a) Each purchase (but not reinvestment) of
undivided percentage ownership interests with regard to the Purchased Interest
hereunder shall be made upon the Seller’s irrevocable written notice in the form
of Annex B (the “Purchase Notice”) delivered to the Administrator in accordance
with Section 5.2 (which notice must be received by the

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Administrator before 11:00 a.m., New York City time) at least “(x) one Business
Day before the requested purchase date in the case of a purchase of less than
$50,000,000 and (y) two Business Days before the requested purchase date in the
case of a purchase of at least $50,000,000, which notice in each case shall
specify: (A) the amount requested to be paid to the Seller (such amount, which
shall not be less than $1,000,000 and shall be in integral multiples of
$100,000, being the Capital relating to the undivided percentage ownership
interest then being purchased), (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 Capital.
(b)    On the date of each purchase (but not reinvestment) of undivided
percentage ownership interests with regard to the Purchased Interest hereunder,
the Issuer shall, upon satisfaction of the applicable conditions set forth in
Exhibit II, make available to the Seller in same day funds, at Mellon Bank,
Pittsburgh, Pennsylvania, account number XXXXX, ABA# XXXXXXX, an amount equal to
the Capital relating to the undivided percentage ownership interest then being
purchased as set forth in the applicable Purchase Notice.
(c)    Effective on the date of each purchase pursuant to this Section and each
reinvestment pursuant to Section 1.4, the Seller hereby sells and assigns to the
Issuer 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 Seller hereby grants to the Issuer 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, and other proceeds of, such Pool Receivables and
Related Security, (iv) the Lock-Box Accounts (and the related lock-boxes) and
all amounts on deposit therein, and all certificates and instruments, if any,
from time to time evidencing such Lock-Box Accounts (and such related
lock-boxes) and such amounts on deposit therein, (v) all books and records of
each Receivable, and all rights, remedies, powers and privileges of the Seller
in any accounts into which Collections are or may be received and all rights
(but none of the obligations) of the Seller under the Purchase and Sale
Agreement and (vi) all proceeds and products of, and all amounts received or
receivable under any or all of, the foregoing (collectively, the “Pool Assets”).
The Issuer shall have, with respect to the Pool Assets, and in addition to all
the other rights and remedies available to the Issuer, all the rights and
remedies of a secured party under any applicable UCC. In connection with the
transfer of the undivided interest set forth in Section 1.2(c) or the grant of
the security interest in the Pool Assets set forth in this Section 1.2(d), by
signing this Agreement in the space provided, the Seller hereby authorizes the
filing of all applicable UCC financing statements in all necessary
jurisdictions.
Section 1.3    Purchased Interest Computation. The Purchased Interest shall be
initially computed on the date of the initial purchase hereunder. Thereafter,
until the Facility Termination

 
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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 or the happening of the events set forth in the next sentence) be
deemed to be 100%. The Purchased Interest shall become zero when the Capital
thereof and Discount thereon shall have been paid in full, all the amounts owed
by the Seller and required to be deposited by the Servicer hereunder to the
Issuer, the Administrator and any other Indemnified Party or Affected Person are
paid in full, and the Servicer shall have received the accrued Servicing Fee
thereon.
Section 1.4    Settlement Procedures. (a) 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 Issuer, out of the Issuer’s Share of such Collections, first, an amount
equal to the 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 the
Fee Letter accrued and unpaid through such day, and third, to the extent funds
are available therefor, an amount equal to the Issuer’s 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, on behalf of the Issuer, the remainder of the Issuer’s Share of
such Collections. Such remainder shall be automatically reinvested in Pool
Receivables, and in the Related Security, Collections and other proceeds with
respect thereto; provided, however, that if the Purchased Interest would exceed
100%, then the Servicer shall not reinvest, but shall set aside and hold in
trust for the Issuer (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%,
(iii)    if such day is a Termination Day, set aside, segregate and hold in
trust (and shall, at the request of the Administrator, segregate in a separate
account approved by the Administrator) for the Issuer the entire remainder of
the Issuer’s Share of the Collections; provided, that if amounts are set aside
and held in trust on any Termination Day of the type described in clause (a) of
the definition of “Termination Day” and, thereafter, the conditions set forth in
Section 2 of Exhibit II are satisfied or waived by the Administrator, such
previously set-aside amounts shall be reinvested in accordance with clause (ii)
on the day of such subsequent satisfaction or waiver of conditions, and

 
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(iv)    release to the Seller (subject to Section 1.4(f)) for its own account
any Collections in excess of: (x) amounts required to be reinvested in
accordance with clause (ii) or the proviso to clause (iii) plus (y) the amounts
that are required to be set aside pursuant to clause (i), the proviso to clause
(ii) and clause (iii) plus (z) the Seller’s Share of the Servicing Fee accrued
and unpaid through such day.
(c)    The Servicer shall deposit into the Administration Account (or such other
account designated by the Administrator), on each Settlement Date (or solely
with respect to Collections held for the Issuer pursuant to clause (f) such
other date as set forth in clause (f)(iii) for such payment), Collections held
for the Issuer pursuant to clause (b)(i) or (f) plus the amount of Collections
then held for the Issuer pursuant to clauses (b)(ii) and (iii) of Section 1.4;
provided, that if UGI or an Affiliate thereof is the Servicer, such day is not a
Termination Day and the Administrator has not notified UGI (or such Affiliate)
that the right to retain the portion of the Collections set aside pursuant to
clause (b)(i) that represent the Issuer’s Share of the Servicing Fee is revoked,
UGI (or such Affiliate) may retain the portion of the Collections set aside
pursuant to clause (b)(i) that represents the Issuer’s Share of the Servicing
Fee in payment in full of the Issuer’s Share of accrued Servicing Fees so set
aside. On the last day of each Settlement Period, the Administrator will notify
the Servicer by facsimile of the amount of Discount accrued with respect to each
Portion of Capital during such Settlement Period or portion thereof.
(d)    Upon receipt of funds deposited into the Administration Account pursuant
to clause (c), the Administrator shall cause such funds to be distributed as
follows:
(i)    if such distribution occurs on a day that is not a Termination Day and
the Purchased Interest does not exceed 100%, first to the Issuer in payment in
full of all accrued Discount and fees (other than Servicing Fees) with respect
to each Portion of Capital, and 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 Issuer’s Share of accrued Servicing
Fees so set aside, and
(ii)    if such distribution occurs on a Termination Day or on a day when the
Purchased Interest exceeds 100%, first to the Issuer in payment in full of all
accrued Discount with respect to each Portion of Capital, second to the Issuer
in payment in full of Capital (or, if such day is not a Termination Day, the
amount necessary to reduce the Purchased Interest to 100%), third, to the
Servicer in payment in full of all accrued Servicing Fees, and fourth, if the
Capital and accrued Discount with respect to each Portion of Capital have been
reduced to zero, and all accrued Servicing Fees payable to the Servicer have
been paid in full, to the Issuer, the Administrator and any other Indemnified
Party or Affected Person in payment in full of any other amounts owed thereto by
the Seller hereunder.
After the Capital, Discount, fees payable pursuant to the Fee Letter and
Servicing Fees with respect to the Purchased Interest, and any other amounts
payable by the Seller and the Servicer to the Issuer, the Administrator or any
other Indemnified Party or Affected Person hereunder, have been paid in full,
all additional Collections with respect to the Purchased Interest shall be paid
to the Seller for its own account.

 
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(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, returned, repossessed or
foreclosed goods or services, or any revision, cancellation, allowance, rebate,
discount or other adjustment made by the Seller or any Affiliate of the Seller,
or any setoff or dispute between the Seller or any Affiliate of the Seller 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;
(ii)    if on any day any of the representations or warranties in Section 1(g)
or (n) of Exhibit III, or Section 2, 3 or 4 of Exhibit VI is not true with
respect to any Pool Receivable, the Seller shall be deemed to have received on
such day a Collection of such Pool Receivable in full;
(iii)    except as provided in clause (i) or (ii), or 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 or the Issuer 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 the
Administrator or the Issuer but rather to have been retained by the Seller and,
accordingly, the Administrator or the Issuer, as the case may be, shall have a
claim against the Seller for such amount, payable when and to the extent that
any distribution from or on behalf of such Obligor is made in respect thereof.
(f)    If at any time, the Seller shall wish to cause the reduction of the
Capital (but not to commence the liquidation, or reduction to zero, of the
entire Capital of the Purchased Interest), the Seller may do so as follows:
(i)    the Seller shall give the Administrator and the Servicer written notice
in the form of Annex C (A) at least one Business Day prior to the date of such
reduction for any reduction of Capital less than or equal to $20,000,000; (B) at
least two Business Days prior to the date of such reduction for any reduction of
Capital greater than $20,000,000 and less than or equal to $50,000,000; and (C)
at least three Business Days prior to the date of such reduction for any
reduction of Capital greater than $50,000,000, in each case such notice shall
have been received by 3:00 p.m. New York City time on such date and shall
include the amount of such proposed reduction and the proposed date on which
such reduction will commence;
(ii)    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; and

 
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(iii)    the Servicer shall hold such Collections in trust for the Issuer, for
payment to the Administrator on (1) solely with respect to any reduction
described in subsections (f)(i)(B) or (f)(i)(C) the next Weekly Settlement Date,
or (2) with respect to any reduction described in subsection (f)(i)(A), such
other date with at least one (1) Business Day prior written notice to the
Administrator of such payment, and the Capital shall be deemed reduced in the
amount to be paid to the Administrator only when in fact finally so paid;
provided, that the amount of any such reduction shall be not less than
$1,000,000 and shall be an integral multiple of $100,000.
Section 1.5    Fees. The Seller shall pay to the Administrator certain fees in
the amounts and on the dates set forth in a fee letter, dated the date hereof,
among UGI, the Seller and the Administrator (as such letter agreement may be
amended, supplemented or otherwise modified from time to time, the “Fee
Letter”).
Section 1.6    Payments and Computations, Etc. (a) All amounts to be paid or
deposited by the Seller or the Servicer hereunder shall be made without
reduction for offset or counterclaim and shall be paid or deposited no later
than noon (New York City time) on the day when due in same day funds to the
Administration Account. All amounts received after noon (New York City time)
will be deemed to have been received on the next Business Day.
(b)    The Seller or the Servicer, as the case may be, shall, to the extent
permitted by applicable 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 3.00% 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) 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 the Administrator, the Issuer or any of
their respective Affiliates (each an “Affected Person”) reasonably determines
that the existence of or compliance with: (i) any law or regulation or any
change therein or in the interpretation or application thereof by a Governmental
Authority, in each case adopted, issued or occurring after the date hereof, or
(ii) any request, guideline or directive from any central bank or other
Governmental Authority (whether or not having the force of law) issued or
occurring after the date of this Agreement, affects or would affect the amount
of capital required or expected to be maintained by such Affected Person, and
such Affected Person reasonably determines that the amount of such capital is
increased by or based upon the existence of any commitment to make purchases of
(or otherwise to maintain the investment in) Pool Receivables related to this
Agreement or any related liquidity facility, credit enhancement facility and
other commitments of the same type related to this Agreement, then, upon demand
by such Affected Person (with a copy to the Administrator), the Seller shall
promptly pay to the Administrator, for the account of such Affected Person, from
time to time as specified by such

 
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Affected Person, additional amounts sufficient to compensate such Affected
Person in the light of such circumstances, to the extent that such Affected
Person reasonably determines such increase in capital to be allocable to the
existence of any of such commitments. A certificate as to such amounts submitted
to the Seller and the Administrator by such Affected Person shall be conclusive
and binding for all purposes, absent manifest error.
(b)    If, due to either: (i) the introduction of or any change in or in the
interpretation of any law or regulation by any Governmental Authority occurring
after the date hereof or (ii) compliance with any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law), there shall be any increase in the cost to any Affected Person of agreeing
to purchase or purchasing, or maintaining the ownership of, the Purchased
Interest in respect of which Discount is computed by reference to LMIR, 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. A certificate as to such amounts submitted to the Seller and
the Administrator by such Affected Person shall be conclusive and binding for
all purposes, absent manifest error.
(c)    If such increased costs affect the related Affected Person’s portfolio of
financing transactions, such Affected Person shall use reasonable averaging and
attribution methods to allocate such increased costs to the transactions
contemplated by this Agreement.
(d)    The Administrator will make reasonable efforts to cause the interest of
any Affected Party (other than the Issuer or its domestic Affiliates) that makes
a claim under this Section 1.7 to be transferred to a party that is not subject
to increased costs under this Section 1.7; provided that neither the
Administrator nor any of its Affiliates shall be required hereunder to itself
accept such transferred interest.
(e)    Notwithstanding any language in this Section 1.7 to the contrary, nothing
in this Section 1.7 shall be construed as requiring the Seller to make any
payments attributable to or in respect of any tax of any kind whatsoever imposed
upon or required to be withheld or deducted from payments to any Affected
Person.
Section 1.8    Requirements of Law. If any Affected Person reasonably determines
that the existence of or compliance with: (a) any law or regulation or any
change therein or in the interpretation or application thereof, in each case
adopted, issued or occurring after the date hereof, or (b) any request,
guideline or directive from any central bank or other Governmental Authority
(whether or not having the force of law) issued or occurring after the date of
this Agreement:
(i)    does or shall subject such Affected Person to any tax of any kind
whatsoever with respect to this Agreement, any increase in the Purchased
Interest or in the amount of Capital relating thereto, or does or shall change
the basis of taxation of payments to such Affected Person on account of
Collections, Discount or any other amounts payable hereunder (excluding taxes
imposed on the overall or branch pre-tax net income of such Affected Person, and
franchise taxes imposed on such Affected Person by the jurisdiction under the
laws of which such Affected Person is organized or otherwise is considered doing
business

 
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(unless the Affected Person would not be considered doing business in such
jurisdiction, but for having entered into, or engaged in the transactions in
connection with, this Agreement or any other Transaction Document) or a
political subdivision thereof,
(ii)    does or shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by, or
deposits or other liabilities in or for the account of, purchases, advances or
loans by, or other credit extended by, or any other acquisition of funds by, any
office of such Affected Person that are not otherwise included in the
determination of LMIR or the Base Rate hereunder, or
(iii)    does or shall impose on such Affected Person any other condition,
and the result of any of the foregoing is: (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 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, without duplication to any
amounts paid or payable pursuant to Section 1.7 or Section 3.1 upon demand by
such Affected Person, the Seller shall promptly 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. A certificate from such Affected Person to the Seller and the
Administrator certifying, in reasonably specific detail, the basis for,
calculation of, and amount of such additional costs or reduced amount receivable
shall be conclusive and binding for all purposes, absent manifest error;
provided, however, that no Affected Person shall be required to disclose any
confidential or tax planning information in any such certificate.
Section 1.9    Inability to Determine LMIR. (a) If the Administrator determines
on any day (which determination shall be final and conclusive) that, by reason
of circumstances affecting the interbank eurodollar market generally, deposits
in dollars (in the relevant amounts for such day) are not being offered to banks
in the interbank eurodollar market for such day, or adequate means do not exist
for ascertaining LMIR for such day, then the Administrator shall give notice
thereof to the Seller. Thereafter, until the Administrator notifies the Seller
that the circumstances giving rise to such suspension no longer exist, (i) no
Portion of Capital shall be funded at the Alternate Rate determined by reference
to LMIR and (ii) the Discount for any outstanding Portions of Capital then
funded at the Alternate Rate determined by reference to LMIR shall immediately
be converted to the Alternate Rate determined by reference to the Base Rate.
(b)    If, on any day, the Administrator shall have been notified by the Issuer
that the Issuer has determined (which determination shall be final and
conclusive) that any enactment, promulgation or adoption of or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by a Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Issuer with any guideline, request or directive (whether or not having
the force of law) of any such authority, central bank or comparable agency shall
make it unlawful or impossible for the Issuer to fund or maintain any Portion of
Capital at the Alternate Rate and based upon LMIR , the Administrator shall
notify the Seller thereof. Upon receipt of such notice, until the Administrator

 
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notifies the Seller that the circumstances giving rise to such determination no
longer apply, (i) no Portion of Capital shall be funded at the Alternate Rate
determined by reference to LMIR and (ii) the Discount for any outstanding
Portions of Capital then funded at the Alternate Rate determined by reference to
LMIR shall immediately be converted to the Alternate Rate determined by
reference to the Base Rate.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS;
TERMINATION EVENTS
Section 2.1    Representations and Warranties; Covenants. Each of the Seller,
UGI and the Servicer hereby makes the representations and warranties, and hereby
agrees to perform and observe the covenants, applicable to it set forth in
Exhibits III, IV and VI, respectively.
Section 2.2    Termination Events. If any of the Termination Events set forth in
Exhibit V shall occur, the Administrator may, 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 (f) of Exhibit V, the
Facility Termination Date shall occur. Upon any such declaration, occurrence or
deemed occurrence of the Facility Termination Date, the Issuer 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 after default
under the New York 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 Issuer or any of their respective Affiliates, employees,
officers, directors, agents, counsel, successors, transferees or assigns (each,
an “Indemnified Party”) may have hereunder or under applicable law, the Seller
hereby agrees to indemnify each Indemnified Party from and against any and all
claims, damages, expenses, costs, losses and liabilities (including Attorney
Costs) (all of the foregoing being collectively referred to as “Indemnified
Amounts”) incurred by any Indemnified Party arising out of or resulting from
this Agreement (whether directly or indirectly), the use of proceeds of
purchases or reinvestments, the ownership of the Purchased Interest, or any
interest therein, or in respect of any Receivable, Related Security or Contract,
excluding, however: (a) Indemnified Amounts to the extent resulting from gross
negligence or willful misconduct on the part of such Indemnified Party or its
employees, officers, directors, agents or counsel, (b) recourse with respect to
any Receivable to the extent that such Receivable is uncollectible on account of
insolvency, bankruptcy or lack of creditworthiness of the related Obligor
(except as otherwise specifically provided in this Agreement), or (c) any
overall net income taxes or franchise taxes imposed on such Indemnified Party by
the jurisdiction under the laws of which such Indemnified Party is organized or
otherwise is considered doing business (unless the Indemnified Party would not
be considered doing business in such jurisdiction, but for having entered into,
or engaged in the transactions in connection with, this Agreement or any other
Transaction Document) or any political

 
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subdivision thereof. Without limiting or being limited by the foregoing, and
subject to the exclusions set forth in the preceding sentence, the Seller shall
pay on demand (which demand shall be accompanied by documentation of the
Indemnified Amounts, in reasonable detail) to each Indemnified Party any and all
amounts necessary to indemnify such Indemnified Party from and against any and
all Indemnified Amounts relating to or resulting from any of the following:
(i)    the failure of any Receivable included in the calculation of the Net
Receivables Pool Balance as an Eligible Receivable to be an Eligible Receivable,
the failure of any information contained in an Information Package to be true
and correct, or the failure of any other information provided to the Issuer or
the Administrator with respect to 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 of its officers) under or in connection with this
Agreement to have been true and correct as of the date made or deemed made
(pursuant to paragraph 2(b) of Exhibit II hereof) in all respects when made,
(iii)    the failure by the Seller to comply with any applicable law, rule or
regulation with respect to any Pool Receivable or the related Contract, or the
failure of any Pool Receivable or the related Contract to conform to any such
applicable law, rule or regulation,
(iv)    the failure to vest in the Issuer a valid and enforceable: (A) perfected
undivided percentage ownership interest, to the extent of the Purchased
Interest, in the Receivables in, or purporting to be in, the Receivables Pool
and the other Pool Assets, or (B) first priority perfected security interest in
the Pool Assets, in each case, free and clear of any Adverse Claim,
(v)    the failure to have filed, or any delay in filing, financing statements
or other similar instruments or documents under the UCC of any applicable
jurisdiction or other applicable laws with respect to any Receivables in, or
purporting to be in, the Receivables Pool and the other Pool Assets, whether at
the time of any purchase or reinvestment or at any subsequent time,
(vi)    any dispute, claim, offset or defense (other than discharge in
bankruptcy of the Obligor) of the Obligor to the payment of any Receivable in,
or purporting to be in, the Receivables Pool (including a defense based on such
Receivable or the related Contract not being a legal, valid and binding
obligation of such Obligor enforceable against it in accordance with its terms),
or any other claim resulting from the sale of the goods or services related to
such Receivable or the furnishing or failure to furnish such goods or services
or relating to collection activities with respect to such Receivable (if such
collection activities were performed by the Seller or any of its Affiliates
acting as Servicer or by any agent or independent contractor retained by the
Seller or any of its Affiliates),
(vii)    any failure of the Seller (or any of its Affiliates acting as the
Servicer) to perform its duties or obligations in accordance with the provisions
hereof or under the Contracts,

 
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(viii)    any products liability 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,
(ix)    the commingling of Collections at any time with other funds,
(x)    the use of proceeds of purchases or reinvestments by the Seller, or
(xi)    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 the Administrator, the Issuer or any other 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 incurred by
any Indemnified Party 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 the Issuer or the Administrator 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 to have been true and correct as of the date made or deemed
made (with respect to any Information Package) in all respects 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 (other than as a result of a discharge in
bankruptcy) of the Obligor to the payment of any Receivable in, or purporting to
be in, the Receivables Pool resulting from or related to the 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, (f) the failure to have
filed, or any delay in filing, financing statements or other similar instruments
or documents under the UCC of any applicable jurisdiction or other applicable
laws with respect to any Receivables, in or purporting to be in the Receivables
Pool and any other Pool Assets, whether at the time of any purchase or
reinvestment or at any subsequent time, or (g) any commingling by the Servicer
of Collections at any time with other funds.
Section 3.3    Notice of Claims. Promptly after the receipt by an Indemnified
Party of a notice of the commencement of any action, suit, proceeding,
investigation or claim against such Indemnified Party as to which it proposes to
demand indemnification from the Seller or Servicer (each, as applicable, an
“Indemnifying Party”) pursuant to Section 3.1 or 3.2, as applicable, such
Indemnified Party shall notify the applicable Indemnifying Party in writing of
the commencement thereof; provided that the failure so to notify such
Indemnifying Party shall not relieve such Indemnifying Party from any liability
which such Indemnifying Party may have to such Indemnified Party pursuant to
Section 3.1 or 3.2 unless to the extent that such failure results in the
forfeiture by any such Indemnifying Party of substantive rights or defenses.
ARTICLE IV.
ADMINISTRATION AND COLLECTIONS

 
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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 and unless the Administrator gives notice to UGI upon the occurrence of a
Termination Event (in accordance with this Section) of the designation of a new
Servicer, UGI is hereby designated as, and hereby agrees to perform the duties
and obligations of, the Servicer pursuant to the terms hereof. Upon the
occurrence of a Termination Event, the Administrator may designate as Servicer
any Person (including itself) to succeed UGI 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),
UGI 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 UGI shall cooperate with
and assist such new Servicer. Such cooperation shall include reasonable access
to and transfer of related records and use by the new Servicer of all licenses
(or the obtaining of new licenses), hardware or software necessary or desirable
to collect the Pool Receivables and the Related Security.
(c)    UGI acknowledges that, in making their decision to execute and deliver
this Agreement, the Administrator and the Issuer have relied on UGI’s agreement
to act as Servicer hereunder. Accordingly, UGI agrees that it will not
voluntarily resign as Servicer.
(d)    The Servicer may delegate its duties and obligations hereunder to any
subservicer (each a “Sub-Servicer”); provided, that, in each such delegation:
(i) such Sub-Servicer shall agree in writing to perform the duties and
obligations of the Servicer pursuant to the terms hereof, (ii) the Servicer
shall remain primarily liable for the performance of the duties and obligations
so delegated, (iii) the Seller, the Administrator and the Issuer 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 the Originator,
the Administrator shall have consented in writing in advance to such delegation;
provided, further, that the requirements set forth in clauses (i) and (iv) of
the first proviso shall not apply to any Sub-Servicer that is a utility
providing billing and collection services to the Servicer where amounts owed on
the Receivables are included in the invoice that such utility sends to its
customers.
Section 4.2    Duties of the Servicer. (a) The Servicer shall take or cause to
be taken all such action as may be reasonably 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
Policies. The Servicer shall set aside, for the accounts of the Seller and the
Issuer, 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 as the Servicer may reasonably determine to
be appropriate to maximize Collections thereof or reflect adjustments required
under

 
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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 or limit the rights of the Issuer or the Administrator
under this Agreement and (iii) if a Termination Event has occurred and is
continuing and UGI or an Affiliate thereof is serving as the Servicer, UGI 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 Issuer), 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, the
Administrator may direct the Servicer (whether the Servicer is UGI or any other
Person) to commence or settle any legal action to enforce collection of any Pool
Receivable or to foreclose upon or repossess any Related Security; provided,
however, that no such direction may be given unless either: (A) a Termination
Event has occurred or (B) the Administrator believes in good faith that the
failure to commence, settle or effect such legal action, foreclosure or
repossession could adversely affect Receivables constituting a material portion
of the Pool Receivables.
(b)    The Servicer shall, as soon as practicable following actual receipt of
collected funds, turn over to the Seller (or to the Originator in the case of
payment due to a Reseller) the collections of any indebtedness that is not a
Pool Receivable, less, if UGI 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 UGI 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 later of: (i)
the Facility Termination Date and (ii) the date on which all amounts required to
be paid to the Issuer, the Administrator and any other Indemnified Party or
Affected Person hereunder shall have been paid in full.
After such termination, if UGI 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    Lock-Box Arrangements. Within 30 days of the initial purchase
hereunder, the Seller shall enter into Lock-Box Agreements with all of the
Lock-Box Banks and deliver original counterparts thereof to the Administrator.
Upon the occurrence of and continuance of a Termination Event, the Administrator
may at any time thereafter give notice to each Lock-Box Bank 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 ownership and control of the
Lock-Box Accounts (and the related lock-boxes) transferred to the Administrator
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

 
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Accounts (and the respective related lock-boxes) redirected pursuant to the
Administrator’s instructions rather than deposited in the applicable Lock-Box
Account (or sent to the applicable related lock-box), 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 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 shall be sent immediately to the
Administrator. The parties hereto hereby acknowledge that if at any time the
Administrator takes control of any Lock-Box Account (and any such related
lock-box), the Administrator shall not have any rights to the funds therein in
excess of the unpaid amounts due to the Administrator, the Issuer or any other
Person hereunder, 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
continuance of a Termination Event:
(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 Issuer’s interest in Pool Receivables to each Obligor, which notice shall
direct that payments be made directly to the Administrator or its designee, 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
within a reasonable time after said instruction (in no event not later than 10
days thereafter), 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 in the Servicer’s possession
or under its control necessary or desirable to collect the Pool Receivables and
the Related Security, and transfer or license (or obtain new licenses) to a
successor Servicer the use of all software in the Servicer’s possession or under
its control necessary or desirable to collect the Pool Receivables and the
Related Security, and make the same available to the Administrator or its
designee at a place selected by the Administrator to the extent permissible
under such agreements, and (B) segregate all cash, checks and other instruments
received by it from time to time constituting Collections in a manner reasonably
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, 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, upon the occurrence and continuation of a Termination
Event to take any and all steps in the name of the Seller and on

 
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behalf of the Seller necessary or desirable, in the determination of the
Administrator, 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; provided,
however, that the Administrator shall not be relieved of any liability it might
otherwise have to any party hereunder for its own gross negligence or willful
misconduct.
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 or the Issuer 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. The Administrator and the
Issuer shall not have any obligation or liability with respect to any Pool
Asset, nor shall either of them be obligated to perform any of the obligations
of the Seller, UGI or the Originator thereunder.
(b)    UGI 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, UGI shall
conduct the data-processing functions of the administration of the Receivables
and the Collections thereon in substantially the same way that UGI 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 equal to 0.50% per annum (the “Servicing Fee Rate”) of the daily
average aggregate Outstanding Balance of the Pool Receivables. The Issuer’s
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 UGI 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.
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, and, in the case of any amendment, by the other parties
thereto; and then such amendment, waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given. No failure
on the part of the Issuer or the Administrator to exercise, and no delay in
exercising any right

 
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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. (a) All notices and other communications provided
for hereunder shall, unless otherwise stated herein, be in writing (including
facsimile communication) and shall be personally delivered or sent by certified
mail, postage prepaid, via nationally recognized courier or by facsimile, 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 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 personally delivered, when received, (ii) if sent by certified mail three (3)
Business Days after having been deposited in the mail, postage prepaid, (iii) if
via nationally recognized courier for delivery the next Business Day, and (iv)
if transmitted by facsimile, when sent, receipt confirmed by telephone or
electronic means (and shall be followed by a hard copy sent by first class
mail).
Section 5.3    Assignability. (a) This Agreement and the Issuer’s rights and
obligations herein (including ownership of the Purchased Interest or an interest
therein) shall be assignable, in whole or in part, by the Issuer and its
successors and assigns with the prior written consent of the Seller; provided,
however, that such consent shall not be unreasonably withheld; and provided
further, that no such consent shall be required if the assignment is made to any
Affiliate of PNC (other than a director or officer of PNC) or any Person that is
administered by PNC or any Affiliate of PNC. Each assignor may, in connection
with the assignment, 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, the Issuer or the Administrator. The Administrator shall
give prior written notice of any assignment of the Issuer’s rights and
obligations (including ownership of the Purchased Interest to any Person).
(b)    [Reserved].
(c)    This Agreement and the rights and obligations of the Administrator
hereunder shall be assignable, in whole or in part, by the Administrator and its
successors and assigns; 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 exists, the Seller has consented to such
assignment, which consent shall not be unreasonably withheld.
(d)    Except as provided in Section 4.1(d), none of the Seller, UGI or the
Servicer may assign its rights or delegate its obligations hereunder or any
interest herein without the prior written consent of the Administrator.
(e)    Without limiting any other rights that may be available under applicable
law, the rights of the Issuer may be enforced through it or by its agents.
(f)    Each of (A) the Issuer, (B) its successors and assigns and (C) any
assignee under Section 5.3(a) that, in each case, is not a United States Person
(as such term is defined in Section 7701(a)(30) of the United States Internal
Revenue Code of 1986, as amended) for United States federal tax purposes shall
deliver to the Seller, with a copy to the Servicer, a United States Internal

 
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Revenue Service Form W-8BEN or W-8ECI (or successor form) properly completed and
certifying in each case that the party delivering such form is entitled to a
complete exemption from withholding or deduction for or on account of any United
States federal income taxes with respect to amounts derived, directly or
indirectly, in connection with this Agreement. The Issuer, if required to
deliver such form, shall deliver such form on the Closing Date. A party
described in the foregoing clauses (B) or (C) shall deliver such form
concurrently with such party becoming described in any of such clauses. Each
party obligated to deliver a form under the first sentence of this Section
5.3(f) shall, to the extent permitted by law, further deliver to the Seller,
with a copy to the Servicer, a United States Internal Revenue Service Form
W-8BEN or W-8ECI (or successor form) on or before the date that any such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form previously delivered by such party to the Seller,
properly completed and certifying in each case that the party delivering such
form is entitled to a complete exemption from withholding or deduction for or on
account of any United States federal income taxes with respect to amounts
derived, directly or indirectly, in connection with this Agreement. The Seller
shall not be required to pay to or on behalf of any party described in the
foregoing clauses (A) through (C) any additional amount under Section 1.8 or
Section 3.1 attributable to any tax, duty, levy or other charge of any kind
whatsoever imposed upon or required to be withheld or deducted from payments to
any such party if such party shall have failed to satisfy the requirements of
this Section 5.3(f); provided that nothing in this Section 5.3(f) shall relieve
the Seller of any obligation to pay additional amounts under Section 1.8 or
Section 3.1 if, as a result of a change in treaty, law or regulation or the
interpretation or application thereof, adopted, issued or occurring after the
satisfaction by such party of such requirements, such party is no longer
properly entitled to deliver Form W-8BEN or Form W-8ECI (or successor forms)
certifying that such party is entitled to a complete exemption from withholding
or deduction for or on account of any United States federal income taxes with
respect to amounts derived, directly or indirectly, in connection with this
Agreement.
Section 5.4    Costs, Expenses and Taxes. (a) In addition to the rights of
indemnification granted under Section 3.1, the Seller agrees to pay on demand
(which demand shall be accompanied by documentation thereof in reasonable
detail) all reasonable costs and expenses in connection with the preparation,
execution, delivery and administration (including periodic internal audits by
the Administrator of Pool Receivables, provided that the Seller shall not pay
for more than one audit per year unless a Termination Event has occurred and is
continuing) of this Agreement, the other Transaction Documents and the other
documents and agreements to be delivered hereunder (and all reasonable costs and
expenses in connection with any amendment, waiver or modification of any
thereof), including: (i) Attorney Costs for the Administrator, the Issuer and
their respective Affiliates and agents with respect thereto and with respect to
advising the Administrator, the Issuer and their respective Affiliates and
agents as to their rights and remedies under this Agreement and the other
Transaction Documents, and (ii) all reasonable costs and expenses (including
Attorney Costs), if any, of the Administrator, the Issuer and their respective
Affiliates and agents in connection with the enforcement of this Agreement and
the other Transaction Documents.
(b)    In addition, the Seller shall pay on demand any and all stamp and other
similar taxes and fees payable in connection with the execution, delivery,
filing and recording of this Agreement or the other documents or agreements to
be delivered hereunder, and agrees to save each Indemnified

 
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Party harmless from and against any liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes and fees.
Section 5.5    [Reserved].
Section 5.6    Confidentiality. Unless otherwise required by applicable law,
each of the Seller and the Servicer agrees to maintain the confidentiality of
the terms 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 to: (a) 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 (b) the Seller’s legal counsel
and auditors if they agree to hold it confidential. Unless otherwise required by
applicable law, each of the Administrator and the Issuer agrees to maintain the
confidentiality of non-public information regarding UGI and its Subsidiaries and
Affiliates; 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 UGI, (ii) legal
counsel and auditors of the Issuer or the Administrator if they agree to hold it
confidential, (iii) any nationally recognized statistical rating organization
and (iv) any regulatory authorities having jurisdiction over PNC or the Issuer.
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 SECTION 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 FEDERAL
COURT 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.

 
18
 

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Section 5.9    Survival of Termination. The provisions of Sections 1.7, 1.8,
3.1, 3.2, 5.4, 5.6, 5.7, 5.10 and 5.13 shall survive any termination of this
Agreement.
Section 5.10    WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO WAIVES THEIR
RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON
OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY
OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE. 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, except for any prior arrangements made with respect to the payment by
the Issuer of (or any indemnification for) any fees, costs or expenses payable
to or incurred (or to be incurred) by or on behalf of the Seller, the Servicer
and the Administrator.
Section 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    Issuer’s, Administrator’s, Seller’s and Servicer’s Liabilities.
The obligations of the Issuer, the Administrator, the Seller and the Servicer
under the Transaction Documents are solely the corporate or organizational
obligations of the Issuer, the Administrator, the Seller and the Servicer,
respectively. No recourse shall be had for any obligation or claim arising out
of or based upon any Transaction Document against any stockholder, employee,
officer, director, incorporator or organizer of the Issuer, the Administrator,
the Seller or the Servicer; provided, however, that this Section shall not
relieve any such Person of any liability it might otherwise have for its own
gross negligence or willful misconduct.
Section 5.14    Purchase Option. So long as the Credit Agreement is in effect,
the Seller shall have the right to repurchase in full (but not in part) the
Purchased Interest from the Issuer on any Settlement Date on the terms
hereinafter set forth in this Section 5.14 (such date, the “Repurchase Date”).
The Seller shall give the Administrator at least sixty (60) days’ prior written
notice of such repurchase. The Repurchase Date shall occur not later than the
Settlement Date immediately after the sixty-day period following Seller’s
written notice of such repurchase to the Administrator. Upon payment of the full
Repurchase Price for the Purchased Interest on the Repurchase Date, as herein

 
19
 

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provided, the Issuer shall be deemed to have reconveyed the Purchased Interest
to the Seller without recourse, representation or warranty. The Seller shall pay
such repurchase price (the “Repurchase Price”) for the Purchased Interest on the
Repurchase Date in immediately available funds to the Administrator in an amount
equal to the sum of (i) the aggregate of the Discount accrued for each Portion
of Capital for the Issuer accrued to and including the Repurchase Date, (ii) the
Capital for the Issuer, (iii) all amounts payable pursuant to Sections 1.5, 1.7,
1.8 or 5.4 or Article III accrued to and including the Repurchase Date, (iv) all
other fees, costs, expenses and other obligations of the Seller and the Servicer
pursuant to the Transaction Documents that are payable as of the Repurchase
Date, and (v) if UGI is not the Servicer, the Issuer’s Share of the Servicing
Fee allocated to the Purchased Interest that has accrued to and including the
Repurchase Date.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 
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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.
ENERGY SERVICES FUNDING CORPORATION
By:     
Name:     
Title:     
Address:
Energy Services Funding Corporation
460 North Gulph Road, Suite 200
King of Prussia, PA 19406-2815

Attention:    
Telephone:    
Facsimile:     
UGI ENERGY SERVICES, LLC
By:     
Name:     
Title:     
Address:
UGI Energy Services, LLC
1100 Berkshire Boulevard, Suite 305
Wyomissing, PA 19610

Attention:    
Telephone:    
Facsimile:     

 
1
Receivables Purchase Agreement
(UGI)

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PNC BANK, NATIONAL ASSOCIATION,
as Administrator
By:     
Name:     
Title:     
Address:
PNC Bank, National Association
Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707

Attention:    
Telephone:    
Facsimile:    
PNC BANK, NATIONAL ASSOCIATION,
as Issuer
By:     
Name:     
Title:     
Address:
PNC Bank, National Association
Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707

Attention:    
Telephone:    
Facsimile:    

 
2
Receivables Purchase Agreement
(UGI)

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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.
“Administration Account” means the account (account number XXXXXXXXX, ABA number
XXXXXXXXX) of the Issuer maintained at the office of PNC at One PNC Plaza, 249
Fifth Avenue, Pittsburgh, Pennsylvania 15222-2707, or such other account as may
be so designated in writing by the Administrator to the Servicer.
“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; it being understood that any
thereof in favor of, or assigned to, the Issuer or the Administrator (for the
benefit of the Issuer) shall not constitute an Adverse Claim.
“Affected Person” has the meaning set forth in Section 1.7 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, with respect to the Issuer,
Affiliate shall mean the holder(s) of its capital stock. For purposes of this
definition, control of a Person shall mean the power, direct or indirect: (x) to
vote 51% 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.
“Agreement” has the meaning set forth in the preamble to the Agreement.
“Alternate Rate” for any Settlement Period for any Portion of Capital of the
Purchased Interest means an interest rate per annum equal to: (a) the daily
average LMIR for such Settlement Period, or (b) if LMIR is unavailable as
described in Section 1.9, the Base Rate for such Settlement Period; provided,
however, that the “Alternate Rate” for any day while a Termination Event exists
shall be an interest rate equal to 3.00% per annum above the Base Rate in effect
on such day.
“Anti-Terrorism Laws” means any applicable laws or regulation relating to
terrorism, trade sanctions programs and embargoes, import/export licensing,
money laundering or bribery, and any regulation, order, or directive
promulgated, issued or enforced pursuant to such applicable laws or regulations,
all as amended, supplemented or replaced from time to time.

 
 
 

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“Approved Billing Program” means any consolidated billing or similar agreement
between a Purchasing Utility and the Originator pursuant to which the Originator
may from time to time sell and/or assign receivables, which agreement has been
approved in writing by the Administrator; provided, that if (i) the Originator
delivers to the Administrator in writing and in accordance with Section 5.2 a
copy of such an agreement (or a substantially final draft thereof) with a
request that it be approved as an “Approved Billing Program” and (ii) the
Administrator does not, on or prior to the date that is ten (10) Business Days
following such delivery, notify the Originator or the Servicer that the
Administrator is withholding such approval, the Administrator shall be deemed to
have approved such agreement as an “Approved Billing Program” in accordance with
this definition. Without limiting the generality of the foregoing, each of the
following agreements shall be an Approved Billing Program: (x) that certain
Consolidated Utility Billing Service and Assignment Agreement, contemplated to
be entered into between Consolidated Edison Company of New York, Inc. and the
Originator, containing terms and conditions in form and substance substantially
similar to those set forth in the draft of such agreement previously delivered
by the Originator to the Administrator on April 7, 2009 and (y) that certain
Third Party Supplier Customer Account Services Master Service Agreement, dated
November 6, 2008, by and between Public Service Electric and Gas Company and the
Originator, a copy of which was delivered by the Originator to the Administrator
on April 20, 2009.
“Attorney Costs” means and includes all reasonable fees and disbursements of any
law firm or other external counsel, the reasonable allocated cost of internal
legal services 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, 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
higher of:
(a)    the rate of interest in effect for such day as publicly announced from
time to time by PNC in Pittsburgh, Pennsylvania as its “prime rate.” Such “prime
rate” is set by PNC based upon various factors, including PNC’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
(b)    0.50% per annum above the latest Federal Funds Rate.
“Benefit Plan” means any employee benefit pension plan as defined in Section
3(2) of ERISA in respect of which the Seller, the Originator, UGI or any ERISA
Affiliate is an “employer” as defined in Section 3(5) of ERISA.
“Billing Program Receivable” means a Receivable described in clause (i) of the
definition of the term “Receivable”, which is sold and/or assigned by the
Originator to a Purchasing Utility from time to time pursuant to an Approved
Billing Program.

 
 
 

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“Business Day” means any day (other than a Saturday or Sunday) on which: (a)
banks are not authorized or required to close in New York City, New York or
Pittsburgh, Pennsylvania, and (b) if this definition of “Business Day” is
utilized in connection with LMIR, dealings are carried out in the London
interbank market.
“Capital” means the amount paid to the Seller in respect of the Purchased
Interest by the Issuer pursuant to the Agreement, or such amount divided or
combined in order to determine the Discount applicable to any Portion of
Capital, in each case 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.
“Change in Control” means that (a) with respect to the Seller, UGI ceases to
own, directly or indirectly, 100% of the capital stock of the Seller free and
clear of all Adverse Claims, (b) with respect to UGI, UGI Enterprises, Inc.
shall cease to own 51% or more of the shares of outstanding voting stock of UGI
on a fully diluted basis.
“Closing Date” means November 30, 2001.
“Collections” means, with respect to any Pool Receivable: (a) all funds that are
received by the Originator, UGI, the Seller or the Servicer 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.
“Company Note” has the meaning set forth in the Purchase and Sale Agreement
“Concentration Percentage” means for any: (a) Group A Obligor, 16.00%, (b) Group
B Obligor, 12.00%, (c) Group C Obligor, 8.00% and (d) Group D Obligor, 4.00%.
“Concentration Reserve Percentage” means, at any time, the largest of: (a) the
sum of five largest Group D Obligor Percentages, (b) the sum of the three
largest Group C Obligor Percentages, (c) the sum of two largest Group B Obligor
Percentages and (d) the largest Group A Obligor Percentage.
“Contract” means, with respect to any Receivable, any and all contracts,
instruments, agreements, leases, invoices, notes or other writings pursuant to
which such Receivable arises or that evidence such Receivable or under which an
Obligor becomes or is obligated to make payment in respect of such Receivable.

 
 
 

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“Contributed Receivables” has the meaning set forth in Section 2.2 of the
Purchase and Sale Agreement.
“Covered Entity” means (a) the Seller, the Servicer and each Originator and (b)
each Person that, directly or indirectly, is in control of a Person described in
clause (a) above. For purposes of this definition, control of a Person shall
mean the direct or indirect (x) ownership of, or power to vote, 25% or more of
the issued and outstanding equity interests having ordinary voting power for the
election of directors of such Person or other Persons performing similar
functions for such Person, or (y) power to direct or cause the direction of the
management and policies of such Person whether by ownership of equity interests,
contract or otherwise.
“Credit Agreement” means that certain Credit Agreement, dated on or about
August 26, 2010, among UGI, as borrower, the lenders party thereto, JPMorgan
Chase Bank, N.A., as administrative agent, PNC Bank, National Association, Wells
Fargo Bank, National Association, and certain other parties, as such agreement
may be amended, amended and restated, supplemented or otherwise modified from
time to time.
“Credit and Collection Policy” means, as the context may require, those
receivables credit and collection policies and practices of the Originator in
effect on the date of the Agreement and described in Schedule I to the
Agreement, as modified in compliance with the Agreement.
“Cut-off Date” has the meaning set forth in the Purchase and Sale Agreement.
“Days’ Sales Outstanding” means, for any calendar month, an amount (expressed as
a number of days) computed as of the last day of such calendar 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 calendar months ended on the last day
of such calendar month divided by (b) (i) the aggregate credit sales made by the
Originator during the three calendar months ended on the last day of such
calendar month divided by (ii) 90.
“Debt” means: (a) indebtedness for borrowed money, (b) obligations evidenced by
bonds, debentures, notes or other similar instruments, (c) obligations to pay
the deferred purchase price of property or services, (d) obligations as lessee
under leases that shall have been or should be, in accordance with GAAP,
recorded as capital leases, and (e) obligations under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to purchase
or otherwise acquire, or otherwise to assure a creditor against loss in respect
of, indebtedness or obligations of others of the kinds referred to in clauses
(a) through (d).
“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 calendar month by dividing: (a) the aggregate Outstanding Balance of
all Pool Receivables that became Defaulted Receivables during such month, by (b)
the aggregate credit sales made by the Originator during the month that is three
calendar months before such month. The Outstanding Balance of any Defaulted
Receivable shall be determined without regard to any credit memos or credit
balances.
“Defaulted Receivable” means a Receivable:

 
 
 

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(a)    as to which any payment, or part thereof, remains unpaid for more than 60
days from the original due date for such payment, or
(b)    without duplication (i) as to which an Insolvency Proceeding shall have
occurred with respect to the Obligor thereof or any other Person obligated
thereon with respect thereto, or (ii) that has been written off the 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 calendar 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 (excluding
Delinquent Receivables that have a stated maturity which is more than 60 days
after the original invoice date of such Receivable) on such day.
“Delinquent Receivable” means any portion of a Receivable as to which any
payment, or part thereof, remains unpaid for more than 60 days from the original
due date for such payment. The Outstanding Balance of any Delinquent Receivable
shall be determined without regard to any credit memos or credit balances and
shall exclude Delinquent Receivables that have a stated maturity which is more
than 60 days after the original invoice date of such Receivable.
“Dilution Horizon” means, for any calendar 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 calendar month of: (a) the aggregate
credit sales made by the Originator during the most recent calendar month and
50% of the next most recent calendar month’s credit sales to (b) the Net
Receivables Pool Balance at the last day of the most recent calendar 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 calendar month by dividing: (a) the aggregate amount of
payments required to be made by the Seller pursuant to Section 1.4(e)(i) of the
Agreement during such calendar month, by (b) the aggregate credit sales made by
the Originator during the month that is one calendar month before such month.
“Dilution Reserve” means, on any date, an amount equal to: (a) the Capital at
the close of business of the Servicer on such date multiplied by (b) (i) the
Dilution Reserve Percentage on such date, divided by (ii) 100% minus the
Dilution Reserve Percentage on such date.
“Dilution Reserve Percentage” means on any date, the product of (i) the Dilution
Horizon multiplied by (ii) the sum of (x) 2.25 times the average of the Dilution
Ratios for the twelve most recent calendar months and (y) the Spike Factor.
“Discount” means:
for the Portion of Capital for any Settlement Period:
AR x C x ED/Year + TF
where:

 
 
 

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AR
=     the Alternate Rate for the Portion of Capital for such Settlement Period,

C
=    the Portion of Capital during such Settlement Period,

ED
=    the actual number of days during such Settlement Period,

TF
=    the Termination Fee, if any, for the Portion of Capital for such Settlement
Period, and

Year
=    if such Portion of Capital is funded based upon: (i) LMIR, 360 days, and
(ii) the Base Rate, 365 or 366 days, as applicable;

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 provided further, 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.
“Eligible Receivable” means, at any time, a Pool Receivable:
(a)    the Obligor of which is (i) (A) a United States resident and (B) not a
Sanctioned Obligor, (ii) not a government or a governmental subdivision,
affiliate or agency, provided, however, if the Obligor of such Receivable is a
government or a governmental subdivision, affiliate or agency, such Receivable
shall satisfy the requirements of this clause (a)(ii) if the sum of the
Outstanding Balance of such Receivable and the aggregate Outstanding Balance of
all other Eligible Receivables of Obligors who are governments or governmental
subdivisions, affiliates or agencies does not exceed $200,000, (iii) not subject
to any action of the type described in paragraph (f) of Exhibit V to the
Agreement, (iv) not an Affiliate of UGI; provided, however, if the Obligor of
such Receivable is either UGI Utilities, Inc., UGI Penn Natural Gas, Inc. or UGI
Central Penn Gas, Inc. (provided that UGI Penn Natural Gas, Inc. and UGI Central
Penn Gas, Inc. are wholly-owned subsidiaries of UGI Utilities, Inc.), such
Receivable shall satisfy the requirements of this clause (a)(iv) if the sum of
the Outstanding Balance of such Receivable and the aggregate Outstanding Balance
of all other Eligible Receivables of the Obligors of which are UGI Utilities,
Inc., UGI Penn Natural Gas, Inc. and/or UGI Central Penn Gas, Inc. does not
exceed $12,500,000, and (v) not a Reseller, provided, however, if the Obligor of
such Receivable is a Reseller, such Receivable shall satisfy the requirements of
this clause (a)(v) if the sum of the Outstanding Balance of such Receivable and
the aggregate Outstanding Balance of all other Eligible Receivables of Obligors
who are Resellers does not exceed $2,000,000,
(b)    that is denominated and payable only in U.S. dollars in the United
States,
(c)    that does not have a stated maturity which is more than 45 days after the
original invoice date of such Receivable; provided, however, that up to 10% of
the aggregate Outstanding Balance of all Receivables may have a stated maturity
which is more than 45 days but not more than 60 days after the original invoice
date of such Receivable,

 
 
 

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(d)    (i) that arises under a duly authorized Contract for the sale and
delivery of goods and services in the ordinary course of the Originator’s
business or (ii) in the case of a Receivable arising in connection with the sale
or assignment by the Originator to a Purchasing Utility of a Billing Program
Receivable, such Receivable arises under an Approved Billing Program; provided,
however, that Receivables described in clause (ii) above shall not constitute
Eligible Receivables to the extent that the aggregate Outstanding Balance of
such Receivables exceeds 20% of the aggregate Outstanding Balance of all
Eligible Receivables,
(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, subject to
applicable bankruptcy, fraudulent transfer or conveyance, insolvency,
reorganization, moratorium and other similar laws limiting the enforceability of
creditors’ rights generally, as from time to time in effect,
(f)    that conforms in all material respects with all applicable laws, rulings
and regulations in effect,
(g)    that is not the subject of any asserted dispute, offset, hold back
defense, Adverse Claim or other claim,
(h)    that satisfies in all material respects 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 arise under Contracts, the terms of which do not
expressly prohibit the Seller from assigning its right to receive payment under
the Contract or require any consent of the related Obligor for such assignment,
(k)    for which the Issuer 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 (i) is neither a Defaulted Receivable nor a Delinquent Receivable
and (ii) either (A) is an Eligible Unbilled Receivable or (B) has been billed or
invoiced to the related Obligor,
(n)    for which neither the Originator thereof, the Seller nor the Servicer has
established any offset arrangements with the related Obligor,

 
 
 

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(o)    of an Obligor as to which Defaulted Receivables of such Obligor do not
exceed 25% of the Outstanding Balance of all such Obligor’s Receivables;
provided, however, that amounts owing from Cooperative Industries Inc. that are
more than 90 days from the original invoice date as of the Closing Date and that
are being paid in accordance with a negotiated payment schedule shall not be
considered Defaulted Receivables for purposes of this clause (o), and
(p)    that represents amounts earned and payable by the Obligor that are not
subject to the performance of additional services by the Originator thereof.
“Eligible Unbilled Receivable” means, at any time, any Receivables as to which
the invoice or bill with respect thereto has not yet been sent to the Obligor
thereof if (a) the related Originator has recognized the related revenue on its
financial books and records under GAAP; and (b) not more than [30] days have
expired since such Receivable arose.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and any successor statute of similar import, together with
the regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA also refer to any successor sections.
“ERISA Affiliate” means: (a) any corporation that is a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
Internal Revenue Code) as the Seller, the Originator or UGI, (b) a trade or
business (whether or not incorporated) under common control (within the meaning
of Section 414(c) of the Internal Revenue Code) with the Seller, the Originator
or UGI, or (c) a member of the same affiliated service group (within the meaning
of Section 414(m) of the Internal Revenue Code) as the Seller, the Originator,
any corporation described in clause (a) or any trade or business described in
clause (b).
“Excess Concentration” means, at any time, without duplication, the sum of:
(i)    the sum of the amounts by which the Outstanding Balance of Eligible
Receivables of each Obligor then in the Receivables Pool exceeds an amount equal
to: (a) the applicable Concentration Percentage for such Obligor, multiplied by
(b) the Outstanding Balance of all Eligible Receivables then in the Receivables
Pool; plus
(ii)    the amount by which the aggregate Outstanding Balance of all Eligible
Receivables that are Eligible Unbilled Receivables exceeds 35% of the
Outstanding Balance of all Eligible Receivables then in the Receivables Pool.
“Facility Termination Date” means the earliest to occur of: (a) October 26,
2018, (b) the date determined pursuant to Section 2.2 of the Agreement and (c)
the date the Purchase Limit reduces to zero pursuant to Section 1.1(b) of the
Agreement.

 
 
 

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“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.
“GAAP” means the generally accepted accounting principles and practices in the
United States, consistently applied.
“Governmental Authority” means any nation or government, any state or other
political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any body or entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, including any court, and any Person owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
“Group A Obligor” means any Obligor 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 its
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,
“A1” or better by Moody’s on its long-term senior unsecured and
uncredit-enhanced debt securities.
“Group A Obligor Percentage” means, at any time, for each Group A Obligor, the
percentage equivalent of: (a) the aggregate Outstanding Balance of the Eligible
Receivables of such Group A Obligor less any Excess Concentrations of such
Obligor, divided by (b) the aggregate Outstanding Balance of all Eligible
Receivables at such time.
“Group B Obligor” means an Obligor, 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 its 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, “Baa1” to “A2” by Moody’s on its long-term
senior unsecured and uncredit-enhanced debt securities.

 
 
 

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“Group B Obligor Percentage” means, at any time, for each Group B Obligor, the
percentage equivalent of: (a) the aggregate Outstanding Balance of the Eligible
Receivables of such Group B Obligor less any Excess Concentrations of such
Obligor, divided by (b) the aggregate Outstanding Balance of all Eligible
Receivables at such time.
“Group C Obligor” means an Obligor, 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 its 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
its long-term senior unsecured and uncredit-enhanced debt securities.
“Group C Obligor Percentage” means, at any time, for each Group C Obligor, the
percentage equivalent of: (a) the aggregate Outstanding Balance of the Eligible
Receivables of such Group C Obligor less any Excess Concentrations of such
Obligor, divided by (b) the aggregate Outstanding Balance of all Eligible
Receivables at such time.    
“Group D Obligor” means any Obligor that is not a Group A Obligor, Group B
Obligor or Group C Obligor.
“Group D Obligor Percentage” means, at any time, for each Group D Obligor: (a)
the aggregate Outstanding Balance of the Eligible Receivables of such Group D
Obligor less any Excess Concentrations of such Obligor, divided by (b) the
aggregate Outstanding Balance of all Eligible Receivables at such time.
“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.
“Indemnifying Party” has the meaning set forth in Section 3.3 of the Agreement.
“Independent Director” has the meaning set forth in paragraph 3(c) of Exhibit IV
to the Agreement.
“Information Package” means a report, in substantially the form of either Annex
A-1 (in the case of an Information Package delivered in connection with a
Settlement Date) or Annex A-2 (in the case of an Information Package delivered
at any other time) to the Agreement, furnished to the Administrator pursuant to
the Agreement.
“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,
or 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.

 
 
 

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“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended from
time to time, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of the Internal Revenue Code also refer to any successor sections.
“Issuer” has the meaning set forth in the preamble to the Agreement.
“Issuer’s Share” of any amount means such amount multiplied by the Purchased
Interest at the time of determination.
“LCR Security” means any commercial paper or security (other than the Company
Notes and other equity securities issued to UGI or any Originator that is a
consolidated subsidiary of UGI under GAAP) within the meaning of Paragraph
__.32(e)(1)(viii) of the final rules titled Liquidity Coverage Ratio: Liquidity
Risk Measurement Standards, 79 Fed. Reg. 197, 61440 et seq. (October 10, 2014).
“LMIR” means for any day during any Settlement Period the greater of (a) 0% and
(b) the one-month Eurodollar rate for U.S. dollar deposits as reported on the
Reuters Screen LIBOR01 Page or any other page that may replace such page from
time to time for the purpose of displaying offered rates of leading banks for
London interbank deposits in United States dollars, as of 11:00 a.m. (London
time) on such day, or if such day is not a Business Day, then the immediately
preceding Business Day (or if not so reported, then as determined by the
Administrator from another recognized source for interbank quotation), in each
case, changing when and as such rate changes.
“Lock-Box Account” means an account in the name of the Seller and maintained by
the Seller at a bank or other financial institution for the purpose of receiving
Collections.
“Lock-Box Agreement” means an agreement, in form and substance satisfactory to
the Administrator, among the Seller, the Originator, the Servicer, the
Administrator, the Issuer and a Lock-Box Bank.
“Lock-Box Bank” means any of the banks or other financial institutions holding
one or more Lock-Box Accounts.
“Loss Reserve” means, on any date, an amount equal to: (a) the Capital at the
close of business of the Servicer on such date multiplied by (b)(i) the Loss
Reserve Percentage on such date divided by (ii) 100% minus the Loss Reserve
Percentage on such date.
“Loss Reserve Percentage” means, on any date, the product of (i) 2.25 times (ii)
the highest average of the Default Ratios for any three consecutive calendar
months during the twelve most recent calendar months times (iii) (A) the
aggregate credit sales made by the Originator during the four most recent
calendar months, divided by (B) the Net Receivables Pool Balance as of such
date.
“Material Adverse Effect” means, relative to any Person with respect to any
event or circumstance, a material adverse effect on:
(q)    the assets, operations, business or financial condition of such Person,

 
 
 

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(r)    the ability of any of such Person to perform its obligations under the
Agreement or any other Transaction Document to which it is a party,
(s)    the validity or enforceability of any other Transaction Document, or the
validity, enforceability or collectibility of a material portion of the Pool
Receivables, or
(t)    the status, perfection, enforceability or priority of the Issuer’s or the
Seller’s interest in the Pool Assets.
“Moody’s” means Moody’s Investors Service, Inc.
“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.
“Obligor” means, with respect to any Receivable, the Person obligated to make
payments pursuant to the Contract relating to such Receivable.
“Originator” has the meaning set forth in the Purchase and Sale Agreement.
“Originator Assignment Certificate” means the assignment, in substantially the
form of Exhibit C to the Purchase and Sale Agreement, evidencing Seller’s
ownership of the Receivables generated by the Originator, as the same may be
amended, supplemented, amended and restated, or otherwise modified from time to
time in accordance with the Purchase and Sale Agreement.
“Outstanding Balance” of any Receivable at any time means the then outstanding
principal balance thereof.
“Payment Date” has the meaning set forth in Section 2.2 of the Purchase and Sale
Agreement.
“Person” means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint venture,
limited liability company or other entity, or a government or any political
subdivision or agency thereof.
“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 any separate portion of Capital being funded or
maintained by the Issuer (or its successors or permitted assigns) by reference
to a particular interest rate basis. In addition, at any time when the Capital
of the Purchased Interest is not divided into two or more such portions,
“Portion of Capital” means 100% of the Capital.
“Purchase and Sale Agreement” means the Purchase and Sale Agreement, dated as of
even date herewith, between the Seller and UGI, as such agreement may be
amended, amended and restated, supplemented or otherwise modified from time to
time.

 
 
 

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“Purchase and Sale Indemnified Amounts” has the meaning set forth in Section 9.1
of the Purchase and Sale Agreement.
“Purchase and Sale Indemnified Party” has the meaning set forth in Section 9.1
of the Purchase and Sale Agreement.
“Purchase and Sale Termination Date” has the meaning set forth in Section 1.4 of
the Purchase and Sale Agreement.
“Purchase and Sale Termination Event” has the meaning set forth in Section 8.1
of the Purchase and Sale Agreement.
“Purchase Facility” has the meaning set forth in Section 1.1 of the Purchase and
Sale Agreement.
“Purchase Limit” means (i) at any time on or after October 27, 2017 and prior to
but excluding May 1, 2018, $150,000,000 and (ii) at any time on and after May 1,
2018, $75,000,000, in each case, as such amount may be subsequently reduced
pursuant to Section 1.1(b) of the Agreement; provided, that any such reduction
of the Purchase Limit then in effect pursuant to clauses (i) or (ii) above, as
applicable, shall automatically and permanently reduce the amount of the
Purchase Limit set forth in such other clauses above in the same proportion as
the percentage of the reduction of the Purchase Limit then in effect. References
to the unused portion of the Purchase Limit shall mean, at any time, the
Purchase Limit minus the then outstanding Capital.
References to the unused portion of the Purchase Limit shall mean, at any time,
the Purchase Limit minus the then outstanding Capital.
“Purchase Notice” has the meaning set forth in Section 1.2(a) of the Agreement.
“Purchase Price” has the meaning set forth in Section 2.1 of the Purchase and
Sale Agreement.
“Purchase Report” has the meaning set forth in Section 2.1 of the Purchase and
Sale 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:
       Capital + Total Reserves       
Net Receivables Pool Balance
The Purchased Interest shall be determined from time to time pursuant to Section
1.3 of the Agreement.
“Purchasing Utility” means a jurisdictional natural gas or electricity
distribution company.

 
 
 

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“Receivable” means any indebtedness and other obligations (whether or not earned
by performance) owed to the Seller (as assignee of the Originator) or the
Originator by, or any right of the Seller or the Originator to payment from or
on behalf of, an Obligor (including a Purchasing Utility), whether constituting
an account, chattel paper, instrument or general intangible, arising in
connection with (i) property or goods that have been or are to be sold or
otherwise disposed of, or services rendered or to be rendered by the Originator
(including, in each case and without limitation, the sale of electricity or
natural gas) or (ii) the sale or assignment by the Originator to a Purchasing
Utility of a Billing Program Receivable, and, in each case, includes the
obligation (if any) to pay any finance charges, fees and other charges with
respect thereto; provided, however, that “Receivable” shall not include any
Billing Program Receivable. Indebtedness and other obligations arising from any
one transaction, including 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
purchased or otherwise acquired by the Seller pursuant to the Purchase and Sale
Agreement prior to the Facility Termination Date.
“Reference Bank” means PNC.
“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:
(u)    all of the Seller’s and the Originator thereof’s interest in any goods
(including returned goods), and documentation of title evidencing the shipment
or storage of any goods (including returned goods), relating to any sale giving
rise to such Receivable,
(v)    all instruments and chattel paper that may evidence such Receivable,
(w)    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, and
(x)    all of the Seller’s and the Originator thereof’s rights, interests and
claims under the Contracts and all guaranties, indemnities, insurance, letters
of credit 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.
“Reportable Compliance Event” means that any Covered Entity becomes a Sanctioned
Person, or is charged by indictment, criminal complaint or similar charging
instrument, arraigned, or custodially detained in connection with any
Anti-Terrorism Law or any predicate crime to any

 
 
 

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Anti-Terrorism Law, or has knowledge of facts or circumstances to the effect
that it is reasonably likely that any aspect of its operations is in actual or
probable violation of any Anti-Terrorism Law.
“Repurchase Price” has the meaning set forth in Section 5.14 of the Agreement.
“Reserve Floor” means, at any time: (a) the aggregate Capital at such time
multiplied by (b) (i) the Reserve Floor Percentage, divided by (ii) 100%, minus
the Reserve Floor Percentage.
“Reserve Floor Percentage” means, at any time, the sum (expressed as a
percentage) of (a) Concentration Reserve Percentage plus (b) the product of (i)
the average Dilution Ratios for the twelve most recent calendar months and (ii)
the Dilution Horizon.
“Reseller” means an Obligor that purchases product from the Originator and for
which the Originator acts as billing and collection agent with respect to such
Obligor’s resale of the product.
“Restricted Payment” has the meaning set forth in paragraph 1(n) of Exhibit IV
to the Agreement.
“Sanctioned Country” means a country subject to a sanctions program maintained
under any Anti-Terrorism Law.
“Sanctioned Person” means any individual person, group, regime, entity or thing
listed or otherwise recognized as a specially designated, prohibited, sanctioned
or debarred person, group, regime, entity or thing, or subject to any
limitations or prohibitions (including but not limited to the blocking of
property or rejection of transactions), under any Anti-Terrorism Law.
“Seller” has the meaning set forth in the preamble to the Agreement.
“Seller’s Share” of any amount means the greater of: (a) $0 and (b) such amount
minus the Issuer’s 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 third
Wednesday of each calendar month (or the next succeeding Business Day if such
day is not a Business Day) beginning with December 19, 2001 and (ii) on and
after the Facility Termination Date, each day selected from time to time by the
Administrator (it being understood that the Administrator may select such
Settlement Date to occur as frequently as daily), or, in the absence of such
selection, the date specified in clause (i) above.
“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

 
 
 

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including) the next Settlement Date, and (ii) thereafter, each period commencing
on such Settlement Date and ending on (but not including) the next 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
or, in the absence of any such selection, each period of 30 days from the last
day of the preceding Settlement Period.
“Solvent” means, with respect to any Person at any time, a condition under
which:
(i)    the fair value and present fair saleable value of such Person’s total
assets is, on the date of determination, greater than such Person’s total
liabilities (including contingent and unliquidated liabilities) at such time;
(ii)    the fair value and present fair saleable value of such Person’s assets
is greater than the amount that will be required to pay such Person’s probable
liability on its existing debts as they become absolute and matured (“debts,”
for this purpose, includes all legal liabilities, whether matured or unmatured,
liquidated or unliquidated, absolute, fixed, or contingent);
(iii)    such Person is and shall continue to be able to pay all of its
liabilities as such liabilities mature; and
(iv)    such Person does not have unreasonably small capital with which to
engage in its current and in its anticipated business.
For purposes of this definition:
(A)    the amount of a Person’s contingent or unliquidated liabilities at any
time shall be that amount which, in light of all the facts and circumstances
then existing, represents the amount which can reasonably be expected to become
an actual or matured liability;
(B)    the “fair value” of an asset shall be the amount which may be realized
within a reasonable time either through collection or sale of such asset at its
regular market value;
(C)    the “regular market value” of an asset shall be the amount which a
capable and diligent business person could obtain for such asset from an
interested buyer who is willing to Purchase such asset under ordinary selling
conditions; and
(D)    the “present fair saleable value” of an asset means the amount which can
be obtained if such asset is sold with reasonable promptness in an arm’s-length
transaction in an existing and not theoretical market.
“Spike Factor” means, for any calendar month, (a) the positive difference, if
any, between: (i) the highest Dilution Ratio for any calendar month during the
twelve most recent calendar months and (ii) the arithmetic average of the
Dilution Ratios for such twelve months times (b) (i) the highest Dilution Ratio
for any calendar month during the twelve most recent calendar months divided by
(ii) the arithmetic average of the Dilution Ratios for such twelve months.

 
 
 

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“Standard & Poor’s” means Standard & Poor’s, a division of The McGraw-Hill
Companies, Inc.
“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.
“Tangible Net Worth” means, with respect to any Person, the tangible net worth
of such Person as adjusted to eliminate the impact of any charges related to
SFAS 133 and as determined in accordance with GAAP.
“Termination Day” means: (a) each day on which 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.
“Termination Fee” means, for any Settlement Period during which a Termination
Day occurs, the amount, if any, by which: (a) the additional Discount
(calculated without taking into account any Termination Fee or any shortened
duration of such Settlement Period pursuant to the definition thereof) that
would have accrued during such Settlement Period on the reductions of Capital
relating to such Settlement Period had such reductions not been made, exceeds
(b) the income, if any, received by the Issuer from investing the proceeds of
such reductions of Capital, as determined by the Administrator, which
determination shall be binding and conclusive for all purposes, absent manifest
error.
“Total Reserves” means, at any time the greater of (a) the sum of (i) the Yield
Reserve, (ii) the Loss Reserve, and (iii) the Dilution Reserve and (b) the
Reserve Floor.
“Transaction Documents” means the Agreement, the Lock-Box Agreements, the Fee
Letter, the Purchase and Sale Agreement and all other certificates, instruments,
UCC financing statements, reports, notices, agreements and documents executed or
delivered under or in connection with any of the foregoing, in each case as the
same may be amended, supplemented or otherwise modified from time to time in
accordance with the Agreement.
“Turnover Rate” means, for any calendar month, an amount computed as of the last
day of such calendar month equal to: (a) the Outstanding Balance of all Pool
Receivables as of the last day of such calendar month divided by (b)(i) the
aggregate credit sales made by the Originator during the three calendar months
ended on or before the last day of such calendar month divided by (ii) 3.

 
 
 

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“UCC” means the Uniform Commercial Code as from time to time in effect in the
applicable jurisdiction.
“UGI” has the meaning set forth in the preamble to the Agreement.
“Unmatured Purchase and Sale Termination Event” means any event which, with the
giving of notice or lapse of time, or both, would become a Purchase and Sale
Termination Event.
“Unmatured Termination Event” means an event that, with the giving of notice or
lapse of time, or both, would constitute a Termination Event.
“Weekly Settlement Date” means each Wednesday of each week (or the next
succeeding Business Day if such day is not a Business Day), beginning December
5, 2001.
“Yield Reserve” means, on any date, an amount equal to: (a) the Capital at the
close of business of the Servicer on such date multiplied by (b)(i) the Yield
Reserve Percentage on such date divided by (ii) 100% minus the Yield Reserve
Percentage on such date.
“Yield Reserve Percentage” means at any time:
(PY + SFR) x 2.0 x TR
 
12

where:
PY
=    the Base Rate as of the last day of the most recent Settlement Period,

TR
=    the Turnover Rate, and

SFR
=    the Servicing Fee Rate

Other Terms. All accounting terms not specifically defined herein shall be
construed in accordance with GAAP. All terms used in Article 9 of the UCC in the
State of New York, and not specifically defined herein, are used herein as
defined in such Article 9. 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.

 
 
 

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EXHIBIT II
CONDITIONS OF PURCHASES

1.Conditions Precedent to Initial Purchase. The initial purchase under this
Agreement is subject to the following conditions precedent that the
Administrator shall have received on or before November 30, 2001, each in form
and substance (including the date thereof) satisfactory to the Administrator:
(a)    A counterpart of the Agreement and the other Transaction Documents
executed by the parties thereto.
(b)    Certified copies of: (i) the resolutions of the Board of Directors of
each of the Seller, the Originator and UGI authorizing the execution, delivery
and performance by the Seller, the Originator and UGI, as the case may be, of
the Agreement and the other Transaction Documents to which it is a party; (ii)
all documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to the Agreement and the other Transaction
Documents and (iii) the certificate of incorporation and by-laws of the Seller
and UGI.
(c)    A certificate of the Secretary or Assistant Secretary of the Seller, the
Originator and UGI certifying the names and true signatures of its officers who
are authorized to sign the Agreement and the other Transaction Documents. Until
the Administrator receives a subsequent incumbency certificate from the Seller,
the Originator or UGI, as the case may be, the Administrator shall be entitled
to rely on the last such certificate delivered to it by the Seller, the
Originator or UGI, as the case may be.
(d)    Proper financing statements or other instrument similar in effect,
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,
UGI and the Issuer contemplated by the Agreement and the Purchase and Sale
Agreement.
(e)    Proper financing statements or other instrument similar in effect,
suitable for filing, if any, necessary to release all security interests and
other rights of any Person in the Receivables, Contracts or Related Security
previously granted by the Originator, UGI or the Seller.
(f)    Completed UCC search reports, dated on or shortly before the date of the
initial purchase hereunder, listing the financing statements filed in all
applicable jurisdictions referred to in subsection (e) above that name the
Originator 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 Pension Benefit Guaranty Corporation in such
jurisdictions, as the Administrator may request, showing no Adverse Claims on
any Pool Assets.
(g)    Copies of executed Lock-Box Agreements with each Lock-Box Bank (to be
delivered within 30 days of the Closing Date).

 
 
 

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(h)    Favorable opinions, in form and substance reasonably satisfactory to the
Administrator, of Morgan, Lewis & Bockius LLP, counsel for the Seller, the
Originator and the Servicer.
(i)    Satisfactory results of a review and audit (performed by representatives
of the Administrator) of the Servicer’s collection, operating and reporting
systems, the Credit and Collection Policy of the Originator, historical
receivables data and accounts, including satisfactory results of a review of the
Servicer’s operating location(s) and satisfactory review and approval of the
Eligible Receivables in existence on the date of the initial purchase under the
Agreement.
(j)    A pro forma Information Package representing the performance of the
Receivables Pool for the calendar month before closing.
(k)    Evidence of payment by the Seller of all accrued and unpaid fees
(including those contemplated by the Fee Letter), costs and expenses to the
extent then due and payable on the date thereof, including any such costs, fees
and expenses arising under or referenced in Section 5.4 of the Agreement and the
Fee Letter.
(l)    The Fee Letter duly executed by the Seller and the Servicer.
(m)    Good standing certificates with respect to each of the Seller, the
Originator and the Servicer issued by the Secretary of State (or similar
official) of the state of each such Person’s organization or formation and
principal place of business.
(n)    All Transaction Documents duly executed by the parties thereto.
(o)    A computer file containing all information with respect to the
Receivables as the Administrator or the Issuer may reasonably request.
(p)    Such other approvals, opinions or documents as the Administrator or the
Issuer may reasonably request.
2.    Conditions Precedent to All Purchases and Reinvestments. Each purchase
(except as to clause (a), including the initial purchase) and each reinvestment
shall be subject to the further conditions precedent that:
(a)    in the case of each purchase, the Servicer shall have delivered to the
Administrator on or before such purchase, in form and substance satisfactory to
the Administrator, a completed pro forma Information Package to reflect the
level of Capital and related reserves and the calculation of the Purchased
Interest after such subsequent purchase and a completed Purchase Notice in the
form of Annex B; and
(b)    on the date of such purchase or reinvestment the following statements
shall be true (and acceptance of the proceeds of such purchase or reinvestment
shall be deemed a representation and warranty by the Seller that such statements
are then true):

 
 
 

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(i)    the representations and warranties contained in Exhibit III or VI to the
Agreement are true and correct in all material respects on and as of the date of
such purchase or reinvestment as though made on and as of such date (except to
the extent that such representations and warranties relate expressly to an
earlier date, and in which case such representations and warranties shall be
true and correct in all material respects as of such earlier date);
(ii)    no event has occurred and is continuing, or would result from such
purchase or reinvestment, that constitutes a Termination Event or an Unmatured
Termination Event;
(iii)    after giving effect to such purchase proposed hereby, the Purchased
Interest will not exceed 100% and the Capital does not exceed the Purchase
Limit; and
(iv)    the Facility Termination Date shall not have occurred.

 
 
 

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EXHIBIT III
REPRESENTATIONS AND WARRANTIES

1.    Representations and Warranties of the Seller. The Seller represents and
warrants as follows:
(a)    The Seller is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware, and is duly qualified to
do business and is in good standing as a foreign corporation in every
jurisdiction where the nature of its business requires it to be so qualified,
except where the failure to be so qualified would not have a Material Adverse
Effect.
(b)    The execution, delivery and performance by the Seller of the Agreement
and the other Transaction Documents to which it is a party, including its use of
the proceeds of purchases and reinvestments: (i) are within its corporate
powers; (ii) have been duly authorized by all necessary corporate action; (iii)
do not contravene or result in a default under or conflict with: (A) its charter
or by-laws, (B) any law, rule or regulation applicable to it, (C) any indenture,
loan agreement, mortgage, deed of trust or other material agreement or
instrument to which it is a party or by which it is bound, or (D) any order,
writ, judgment, award, injunction or decree binding on or affecting it or any of
its property; and (iv) do not result in or require the creation of any Adverse
Claim upon or with respect to any of its properties. The Agreement and the other
Transaction Documents to which it is a party have been duly executed and
delivered by the Seller.
(c)    No authorization, approval or other action by, and no notice to or filing
with, any Governmental Authority or other Person is required for its due
execution, delivery and performance by the Seller of its obligations under the
Agreement or any other Transaction Document to which it is a party, other than
the Uniform Commercial Code filings referred to in Exhibit II to the Agreement,
all of which shall be suitable for filing on or before the date of the first
purchase hereunder.
(d)    Each of the Agreement and the other Transaction Documents to which the
Seller is a party constitutes a legal, valid and binding obligation enforceable
against the Seller in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization or other similar laws from
time to time in effect affecting the enforcement of creditors’ rights generally
and by general principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law.
(e)    There is no pending or, to Seller’s knowledge, threatened action or
proceeding affecting Seller or any of its properties before any Governmental
Authority or arbitrator.
(f)    No proceeds of any purchase or reinvestment will be used to acquire any
equity security of a class that is registered pursuant to Section 12 of the
Securities Exchange Act of 1934.
(g)    The Seller is the legal and beneficial owner of the Pool Receivables and
Related Security, free and clear of any Adverse Claim. Upon each purchase or
reinvestment, the Issuer shall acquire a valid and enforceable perfected
undivided percentage ownership or security interest, to

 
 
 

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the extent of the Purchased Interest, in each Pool Receivable then existing or
thereafter arising and in the Related Security, Collections and other proceeds
with respect thereto, free and clear of any Adverse Claim. The Agreement creates
a security interest in favor of the Issuer in the Pool Assets, and the Issuer
has a first priority perfected security interest in the Pool Assets, free and
clear of any Adverse Claims. No effective financing statement or other
instrument similar in effect covering any Pool Asset is on file in any recording
office, except those filed in favor of the Seller pursuant to the Purchase and
Sale Agreement and the Issuer relating to the Agreement.
(h)    Each Information Package (if prepared by the Seller or one of its
Affiliates, or to the extent that information contained therein is supplied by
the Seller or an Affiliate), written information, exhibit, financial statement,
document, book, record or report furnished or to be furnished at any time by or
on behalf of the Seller to the Administrator in connection with the Agreement or
any other Transaction Document to which it is a party is or will be complete and
accurate in all material respects as of its date or (except as otherwise
disclosed to the Administrator at such time) as of the date so furnished,
(i)    The Seller’s principal place of business and chief executive office (as
such terms are used in the UCC) are located at the address referred to in
Sections 1(b) of Exhibit IV to the Agreement and the offices where it keeps its
records concerning the Receivables are located at the addresses set forth in
Schedule IV to the Agreement.
(j)    The names and addresses of all the Lock-Box Banks, together with the
account numbers of the Lock-Box Accounts (and the related lock-boxes) at such
Lock-Box Banks, are specified in Schedule II to the Agreement (or at such other
Lock-Box Banks and/or with such other Lock-Box Accounts (and such other related
lock-boxes) as have been notified to the Administrator in accordance with the
Agreement) and all Lock-Box Accounts (and all related lock-boxes) are subject to
Lock-Box Agreements. The Seller has not granted to any Person, other than the
Administrator as contemplated by the Lock-Box Agreements dominion and control of
any Lock-Box Account (and any related lock-boxes, or the right to take control
of any such account at a future time or upon the occurrence of a future event.
(k)    The Seller is not in violation of any order of any court, arbitrator or
Governmental Authority.
(l)    No proceeds of any purchase or reinvestment will be used for any purpose
that violates any applicable law, rule or regulation, including Regulations T, U
or X of the Federal Reserve Board.
(m)    Each Pool Receivable included as an Eligible Receivable in the
calculation of the Net Receivables Pool Balance is an Eligible Receivable.
(n)    No event has occurred and is continuing, or would result from a purchase
in respect of, or reinvestment in respect of, the Purchased Interest or from the
application of the proceeds therefrom, that constitutes a Termination Event or
an Unmatured Termination Event.

 
 
 

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(o)    The Seller has accounted for each sale of undivided percentage ownership
interests in Receivables in its books and financial statements as sales,
consistent with GAAP.
(p)    The Seller has complied in all material respects with the Credit and
Collection Policies of the Originator with regard to each Receivable originated
by the Originator.
(q)    The Seller has complied in all material respects with all of the terms,
covenants and agreements contained in the Agreement and the other Transaction
Documents that are applicable to it.
(r)    The Seller’s complete corporate name is set forth in the preamble to the
Agreement, and it does not use and has not during the last six years used any
other corporate name, trade name, doing-business name or fictitious name, except
as set forth on Schedule III to the Agreement and except for names first used
after the date of the Agreement and set forth in a notice delivered to the
Administrator pursuant to Section 1(l)(v) of Exhibit IV to the Agreement.
(s)    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. In addition, the Seller is not a “covered fund” under Section
13 of the U.S. Bank Holding Company Act of 1956, as amended, and the applicable
rules and regulations thereunder (the “Volcker Rule”). In determining that
Seller is not a “covered fund” under the Volcker Rule, Seller is entitled to
rely on the exemption from the definition of “investment company” set forth in
Section 3(c)(5)(A) or (B) of the Investment Company Act of 1940, as amended.
(t)    With respect to each Receivable transferred to the Seller under the
Purchase and Sale Agreement, Seller has given reasonably equivalent value to the
Originator thereof in consideration therefor and such transfer was not made for
or on account of an antecedent debt. No transfer by the Originator of any
Receivable under the Purchase and Sale Agreement is or may be voidable under any
section of the Bankruptcy Code.
(u)    Each Contract with respect to each Receivable is effective to create, and
has created, a legal, valid and binding obligation of the related Obligor to pay
the Outstanding Balance of the Receivable created thereunder and any accrued
interest thereon, enforceable against the Obligor in accordance with its terms,
except as such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or limiting creditors’ rights
generally and by general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law).
(v)    Since its most recent fiscal year end, there has been no change in the
business, operations, financial condition, properties or assets of the Seller
which would have a Material Adverse Effect on its ability to perform its
obligations under the Agreement or any other Transaction Document to which it is
a party or materially and adversely affect the transactions contemplated under
the Agreement or such other Transaction Documents.
(w)    No Covered Entity is a Sanctioned Person. No Covered Entity, either in
its own right or through any third party, (a) has any of its assets in a
Sanctioned Country or in the possession,

 
 
 

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custody or control of a Sanctioned Person in violation of any Anti-Terrorism
Law; (b) does business in or with, or derives any of its income from investments
in or transactions with, any Sanctioned Country or Sanctioned Person in
violation of any Anti-Terrorism Law; or (c) engages in any dealings or
transactions prohibited by any Anti-Terrorism Law.
(x)    LCR Security. The Seller has not issued any LCR Securities, and the
Seller is a consolidated subsidiary of UGI under GAAP.
2.    Representations and Warranties of UGI (including in its capacity as the
Servicer). UGI, individually and in its capacity as the Servicer, represents and
warrants as follows:
(a)    UGI is a limited liability company duly formed and validly subsisting
under the laws of the Commonwealth of Pennsylvania and is duly qualified to do
business and is in good standing as a foreign limited liability company in every
jurisdiction where the nature of its business requires it to be so qualified,
except (i) for the District of Columbia and the State of New York, in which
jurisdictions the Servicer shall be qualified within 90 days after the Closing
Date and (ii) where the failure to be so qualified would not have a Material
Adverse Effect.
(b)    The execution, delivery and performance by UGI of its obligations under
the Agreement and the other Transaction Documents to which it is a party,
including UGI in its capacity as the Servicer: (i) are within its organizational
powers; (ii) have been duly authorized by all necessary organizational action;
(iii) do not contravene or result in a default under or conflict with: (A) its
limited liability company operating agreement, (B) any law, rule or regulation
applicable to it, (C) any indenture, loan agreement, mortgage, deed of trust or
other material agreement or instrument to which it is a party or by which it is
bound, or (D) any order, writ, judgment, award, injunction or decree binding on
or affecting it or any of its property; and (iv) do not result in or require the
creation of any Adverse Claim upon or with respect to any of its properties. The
Agreement and the other Transaction Documents to which UGI is a party have been
duly executed and delivered by UGI.
(c)    No authorization, approval or other action by, and no notice to or filing
with any Governmental Authority or other Person, is required for the due
execution, delivery and performance by UGI of its obligations under the
Agreement or any other Transaction Document to which it is a party.
(d)    Each of the Agreement and the other Transaction Documents to which UGI is
a party constitutes the legal, valid and binding obligation of UGI enforceable
against UGI in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization or other similar laws from
time to time in effect affecting the enforcement of creditors’ rights generally
and by general principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law.
(e)    The balance sheets of UGI and its consolidated Subsidiaries as at
September 30, 2001, and the related statements of income and retained earnings
for the fiscal year then ended, copies of which have been furnished to the
Administrator, fairly present the financial condition of UGI and its
consolidated Subsidiaries as at such date and the results of the operations of
UGI and

 
 
 

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its Subsidiaries for the period ended on such date, all in accordance with GAAP
consistently applied, and since September 30, 2001 there has been no event or
circumstances which have had a Material Adverse Effect.
(f)    Except as disclosed in the most recent audited financial statements of
UGI furnished to the Administrator or as otherwise disclosed in writing to the
Administrator, there is no pending or, to its best knowledge, threatened action
or proceeding affecting it or any of its Subsidiaries before any Governmental
Authority or arbitrator that could reasonably be expected to have a Material
Adverse Effect.
(g)    No proceeds of any purchase or reinvestment will be used to acquire any
equity security of a class that is registered pursuant to Section 12 of the
Securities Exchange Act of 1934.
(h)    Each Information Package (if prepared by UGI or one of its Affiliates, or
to the extent that information contained therein is supplied by UGI or an
Affiliate), written information, exhibit, financial statement, document, book,
record or report furnished or to be furnished at any time by or on behalf of UGI
to the Administrator in connection with the Agreement is or will be complete and
accurate in all material respects as of its date or (except as otherwise
disclosed to the Administrator at such time) as of the date so furnished.
(i)    The principal place of business and chief executive office (as such terms
are used in the UCC) of UGI and the office where it keeps its records concerning
the Receivables are located at the address referred to in Section 2(b) of
Exhibit IV to the Agreement.
(j)    UGI is not in violation of any order of any court, arbitrator or
Governmental Authority to which UGI or any of its assets are bound, which is
reasonably likely to have a Material Adverse Effect.
(k)    UGI has complied in all material respects with the Credit and Collection
Policy of the Originator with regard to each Receivable originated by the
Originator.
(l)    UGI has complied in all material respects with all of the terms,
covenants and agreements contained in the Agreement and the other Transaction
Documents that are applicable to it.
(m)    UGI 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. In addition, UGI is not a “holding company,” a “subsidiary company”
of a “holding company,” or an “affiliate” of a “holding company” or of a
“subsidiary company” of a “holding company” within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(n)    Since its most recent fiscal year end, there has been no change in the
business, operations, financial condition, properties or assets of UGI which is
reasonably likely to have a Material Adverse Effect on its ability to perform
its obligations under the Agreement or any other Transaction Document to which
it is a party or materially and adversely affect the transactions contemplated
under the Agreement or such other Transaction Documents.

 
 
 

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(o)    No license or approval is required for the Administrator or any successor
Servicer to use any program (other than MAS90 Software) used by the Servicer in
the servicing of the Receivables, other than such licenses and approvals that
have been obtained and are in full force and effect.
(p)    No Covered Entity is a Sanctioned Person. No Covered Entity, either in
its own right or through any third party, (a) has any of its assets in a
Sanctioned Country or in the possession, custody or control of a Sanctioned
Person in violation of any Anti-Terrorism Law; (b) does business in or with, or
derives any of its income from investments in or transactions with, any
Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law;
or (c) engages in any dealings or transactions prohibited by any Anti-Terrorism
Law.

 
 
 

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EXHIBIT IV
COVENANTS

1.    Covenants of the Seller. Until the latest of the Facility Termination
Date, the date on which no Capital of or Discount in respect of the Purchased
Interest shall be outstanding or the date all other amounts owed by the Seller
under the Agreement to the Issuer, the Administrator and any other Indemnified
Party or Affected Person shall be paid in full:
(a)    Compliance with Laws, Etc. The Seller shall comply in all material
respects with all applicable laws, rules, regulations and orders, and preserve
and maintain its corporate existence, rights, franchises, qualifications and
privileges, except to the extent that the failure so to comply with such laws,
rules, regulations or orders or the failure so to preserve and maintain such
rights, franchises, qualifications and privileges would not have a Material
Adverse Effect.
(b)    Offices, Records and Books of Account, Etc. The Seller: (i) shall keep
its principal place of business and chief executive office (as such terms or
similar terms are used in the UCC) and the office where it keeps its records
concerning the Receivables at the address of the Seller set forth under its name
on the signature page to the Agreement or, pursuant to clause (l)(v) below, at
any other locations in jurisdictions where all actions reasonably requested by
the Administrator to protect and perfect the interest of the Issuer in the
Receivables and related items (including the Pool Assets) have been taken and
completed and (ii) shall provide the Administrator with at least 30 days’
written notice before making any change in the Seller’s name or making any other
change in the Seller’s identity or corporate structure (including a Change in
Control) that could render any UCC financing statement filed in connection with
this Agreement “seriously misleading” as such term (or similar term) is used in
the UCC; each notice to the Administrator pursuant to this sentence shall set
forth the applicable change and the effective date thereof. The Seller also will
maintain and implement (or cause the Servicer to maintain and implement)
administrative and operating procedures (including an ability to recreate
records evidencing 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 Receivables (including records adequate to permit the daily
identification of each Receivable and all Collections of and adjustments to each
existing Receivable).
(c)    Performance and Compliance with Contracts and Credit and Collection
Policy. The Seller shall (and shall cause the Servicer to), at its expense,
timely and fully perform and comply with all material provisions, covenants and
other promises required to be observed by it under the Contracts related to the
Receivables, and timely and fully comply in all material respects with the
applicable Credit and Collection Policies with regard to each Receivable and the
related Contract.
(d)    Ownership Interest, Etc. The Seller shall (and shall cause the Servicer
to), at its expense, take all action necessary or 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

 
 
 

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favor of the Issuer, including taking such action to perfect, protect or more
fully evidence the interest of the Issuer as the Issuer, through the
Administrator, may reasonably request.
(e)    Sales, Liens, Etc. The Seller shall not sell, assign (by operation of law
or otherwise) or otherwise dispose of, or create or suffer to exist any Adverse
Claim upon or with respect to, any or all of its right, title or interest in, to
or under any Pool Assets (including the Seller’s undivided interest in any
Receivable, Related Security or Collections, or upon or with respect to any
account to which any Collections of any Receivables are sent), or assign any
right to receive income in respect of any items contemplated by this paragraph.
(f)    Extension or Amendment of Receivables. Except as provided in the
Agreement, the Seller shall not, and shall not permit the Servicer to, extend
the maturity 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).
(g)    Change in Business or Credit and Collection Policy. The Seller shall not
make (or permit the Originator to make) any material change in the character of
its business or in any Credit and Collection Policy (other than a change to the
insurance provisions of any such policy) that would have a Material Adverse
Effect with respect to the Receivables. The Seller shall not make (or permit the
Originator to make) any other material adverse change in any Credit and
Collection Policy without receiving the prior written consent of the
Administrator.
(h)    Audits. The Seller shall (and shall cause the Originator to), from time
to time during regular business hours as reasonably requested in advance (unless
a Termination Event or an Unmatured Termination Event exists or there shall be a
material adverse variance in the performance of the Receivables) by the
Administrator, permit the Administrator, or its agents or representatives: (i)
to examine and make copies of and abstracts from all books, records and
documents (including computer tapes and disks) in the possession or under the
control of the Seller (or the Originator) relating to Receivables and the
Related Security, including the related Contracts, (ii) to visit the offices and
properties of the Seller and the Originator for the purpose of examining such
materials described in clause (i) above, and to discuss matters relating to
Receivables and the Related Security or the Seller’s, UGI’s or the Originator’s
performance under the Transaction Documents or under the Contracts with any of
the officers, employees, agents or contractors of the Seller or the Originator
having knowledge of such matters and (iii) without limiting the clauses (i) and
(ii) above, no more than once annually (unless a Termination Event has occurred
and is continuing or there shall be a material variance in the performance of
the Receivables) to engage certified public accountants or other auditors
acceptable to the Seller and the Administrator to conduct, at the Seller’s
expense, a review of the Seller’s books and records with respect to such
Receivables.
(i)    Change in Lock-Box Banks, Lock-Box Accounts and Payment Instructions to
Obligors. The Seller shall not, and shall not permit the Servicer or the
Originator to, add or terminate any bank as a Lock-Box Bank or any account as a
Lock-Box Account (or any related lock-box) from those listed in Schedule II to
the Agreement, or make any change in its instructions to Obligors regarding
payments to be made to the Seller, the Originator, the Servicer or any Lock-Box
Account (or the related lock-box), unless the Administrator shall have consented
thereto in writing and the

 
 
 

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Administrator shall have received copies of all agreements and documents
(including Lock-Box Agreements) that it may request in connection therewith.
(j)    Deposits to Lock-Box Accounts. The Seller shall (or shall cause the
Servicer to): (i) within 30 days of the initial purchase hereunder, instruct all
Obligors to make payments of all Receivables to one or more Lock-Box Accounts or
to lock-boxes to which only Lock-Box Banks have access (and shall instruct the
Lock-Box Banks to cause all items and amounts relating to such Receivables
received in such lock-boxes to be removed and deposited into a Lock-Box Account
on a daily basis), and (ii) deposit, or cause to be deposited, any Collections
received by it, the Servicer or the Originator into Lock-Box Accounts not later
than two Business Days after receipt thereof. Each Lock-Box Account shall at all
times be subject to a Lock-Box Agreement. The Seller will not (and will not
permit the Servicer to) deposit or otherwise credit, or cause or permit to be so
deposited or credited, to any Lock-Box Account cash or cash proceeds other than
(i) Collections and (ii) on payments received from end-users payable to a
Reseller in respect of product sold by such Reseller to such end-user, provided
that such payments do not remain on deposit in such Lock-Box Account for more
than two Business Days after deposit therein.
(k)    Marking of Records. At its expense, the Seller shall: (i) mark (or cause
the Servicer to mark) its master data processing records relating to Pool
Receivables and related Contracts with a legend evidencing that the undivided
percentage ownership interests with regard to the Purchased Interest related to
such Receivables and related Contracts have been sold in accordance with the
Agreement, and (ii) cause the Originator so to mark its master data processing
records pursuant to the Purchase and Sale Agreement.
(l)    Reporting Requirements. The Seller will provide to the Administrator (in
multiple copies, if requested by the Administrator) the following:
(i)    as soon as available and in any event within 105 days after the end of
each fiscal year of the Seller, a copy of the annual report for such year for
the Seller containing unaudited financial statements for such year certified as
to accuracy by the chief financial officer or treasurer of the Seller;
(ii)    as soon as possible and in any event within five Business Days after
becoming aware of the occurrence of each Termination Event or Unmatured
Termination Event, a statement of the chief financial officer of the Seller
setting forth details of such Termination Event or Unmatured Termination Event
and the action that the Seller has taken and proposes to take with respect
thereto;
(iii)    promptly after the filing or receiving thereof, copies of all reports
and notices that the Seller or any Affiliate files under ERISA with the Internal
Revenue Service, the Pension Benefit Guaranty Corporation or the U.S. Department
of Labor with respect to any Benefit Plan that is subject to Title IV of ERISA
or that the Seller or any Affiliate receives with respect to any Benefit Plan
that is subject to Title IV of ERISA from any of the foregoing or from any
multiemployer plan (within the meaning of Section 4001(a)(3) of ERISA) to which
the Seller or any of its Affiliates is or was, within the preceding five years,
a contributing employer, in each case in respect of the assessment of withdrawal
liability or

 
 
 

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an event or condition that could, in the aggregate, reasonably result in the
imposition of material liability on the Seller and/or any such Affiliate;
(iv)    at least thirty days before any change in the Seller’s name or any other
change requiring the amendment of UCC financing statements, a notice setting
forth such changes and the effective date thereof;
(v)    promptly after the Seller obtains knowledge thereof, notice of any: (A)
material litigation, investigation or proceeding that may exist at any time
between the Seller and any Person or (B) material litigation or proceeding
relating to any Transaction Document;
(vi)    promptly after becoming aware of 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 the Originator; and
(vii)    such other information respecting the Receivables or the condition or
operations, financial or otherwise, of the Seller or any of its Affiliates as
the Administrator may from time to time reasonably request.
(m)    Certain Agreements. Without the prior written consent of the
Administrator, the Seller will not (and will not permit the Originator to)
amend, modify, waive, revoke or terminate any Transaction Document to which it
is a party or any provision of Seller’s certificate of incorporation or by-laws;
(n)    Restricted Payments. (V) 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 only by declaring and paying dividends or making
returns of capital.
(ii)    The Seller may make Restricted Payments only out of the funds it
receives pursuant to Sections 1.4(b)(ii) and (iv) of the Agreement. Furthermore,
the Seller shall not pay, make or declare: (A) any dividend if, after giving
effect thereto, the Seller’s Tangible Net Worth would be less than $4,000,000,
or (B) any Restricted Payment (including any dividend) if, after giving effect
thereto, any Termination Event or Unmatured Termination Event shall have
occurred and be continuing.
(o)    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 or bankers’ acceptances) other than
pursuant to this Agreement; or (iii) form any Subsidiary or make any investments
in any other Person; provided, however, that the Seller shall be permitted to
incur

 
 
 

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minimal obligations to the extent necessary for the day-to-day operations of the
Seller (such as expenses for stationery, audits, maintenance of legal status,
etc.).
(p)    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 Issuer and
the Administrator under the Agreement and under the Fee Letter); and (ii) other
legal and valid corporate purposes.
(q)    Tangible Net Worth. The Seller will not permit its Tangible Net Worth, at
any time, to be less than $6,000,000.
(r)    Anti-Money Laundering/International Trade Law Compliance. No Covered
Entity will become a Sanctioned Person. No Covered Entity, either in its own
right or through any third party, will (a) have any of its assets in a
Sanctioned Country or in the possession, custody or control of a Sanctioned
Person in violation of any Anti-Terrorism Law; (b) do business in or with, or
derive any of its income from investments in or transactions with, any
Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law;
(c) engage in any dealings or transactions prohibited by any Anti-Terrorism Law
or (d) use the proceeds of any purchase to fund any operations in, finance any
investments or activities in, or, make any payments to, a Sanctioned Country or
Sanctioned Person in violation of any Anti-Terrorism Law. The funds used to
repay Seller’s obligations under this Agreement and each of the other
Transaction Documents will not be derived from any unlawful activity. Each
Covered Entity shall comply with all Anti-Terrorism Laws. Seller shall promptly
notify the Administrator in writing upon the occurrence of a Reportable
Compliance Event.
(s)    LCR Security. The Seller shall not issue any LCR Security.
2.    Covenants of the Servicer and UGI. Until the latest of the Facility
Termination Date, the date on which no Capital of or Discount in respect of the
Purchased Interest shall be outstanding or the date all other amounts owed by
the Seller under the Agreement to the Issuer, the Administrator and any other
Indemnified Party or Affected Person shall be paid in full:
(a)    Compliance with Laws, Etc. The Servicer and, to the extent that it ceases
to be the Servicer, UGI shall comply (and shall cause the Originator to comply)
in all material respects with all applicable laws, rules, regulations and
orders, and preserve and maintain its organizational existence, rights,
franchises, qualifications and privileges, except to the extent that the failure
so to comply with such laws, rules, regulations or orders or the failure so to
preserve and maintain such existence, rights, franchises, qualifications and
privileges would not have a Material Adverse Effect.
(b)    Offices, Records and Books of Account, Etc. The Servicer and, to the
extent that it ceases to be the Servicer, UGI, shall keep (and shall cause the
Originator to keep) its principal place of business and chief executive office
(as such terms or similar terms are used in the applicable UCC) and the office
where it keeps its records concerning the Receivables at the address of the
Servicer set forth under its name on the signature page to the Agreement or,
upon at least 30 days’ prior written notice of a proposed change to the
Administrator, at any other locations in jurisdictions where all actions
reasonably requested by the Administrator to protect and perfect the interest of
the Issuer in the Receivables and related items (including the Pool Assets) have
been taken and

 
 
 

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completed. The Servicer and, to the extent that it ceases to be the Servicer,
UGI, also will (and will cause the Originator to) maintain and implement
administrative and operating procedures (including an ability to recreate
records evidencing 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 Receivables (including records
adequate to permit the daily identification of each Receivable and all
Collections of and adjustments to each existing Receivable).
(c)    Performance and Compliance with Contracts and Credit and Collection
Policy. The Servicer and, to the extent that it ceases to be the Servicer, UGI,
shall (and shall cause the Originator to), at its expense, timely and fully
perform and comply with all material provisions, covenants and other promises
required to be observed by it under the Contracts related to the Receivables,
and timely and fully comply in all material respects with the Credit and
Collection Policy with regard to each Receivable and the related Contract.
(d)    Extension or Amendment of Receivables. Except as provided in the
Agreement, the Servicer and, to the extent that it ceases to be the Servicer,
UGI, shall not extend (and shall not permit the Originator to extend), the
maturity 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).
(e)    Change in Business or Credit and Collection Policy. The Servicer and, to
the extent that it ceases to be the Servicer, UGI, shall not make (and shall not
permit the Originator to make) any material change in the character of its
business or in any Credit and Collection Policy (other than a change to the
insurance provisions of any such policy) without the consent of the
Administrator that would be reasonably likely to have a Material Adverse Effect.
The Servicer and, to the extent that it ceases to be the Servicer, UGI, shall
not make (and shall not permit the Originator to make) any other material
adverse change in any Credit and Collection Policy without receiving the prior
written consent of the Administrator.
(f)    Audits. The Servicer and, to the extent that it ceases to be the
Servicer, UGI, shall (and shall cause the Originator to), from time to time
during regular business hours as reasonably requested in advance (unless a
Termination Event or an Unmatured Termination Event exists or there shall be a
material adverse variance in the performance of the Receivables) by the
Administrator, permit the Administrator, or its agents or representatives: (i)
to examine and make copies of and abstracts from all books, records and
documents (including computer tapes and disks) in its possession or under its
control relating to Receivables and the Related Security, including the related
Contracts; (ii) to visit its offices and properties for the purpose of examining
such materials described in clause (i) above, and to discuss matters relating to
Receivables and the Related Security or its performance hereunder or under the
Contracts with any of its officers, employees, agents or contractors having
knowledge of such matters and (iii), without limiting the clauses (i) and (ii)
above, no more than once annually (unless a Termination Event has occurred and
is continuing or there shall be a material variance in the performance of the
Receivables) to engage certified public

 
 
 

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accountants or other auditors acceptable to the Servicer and the Administrator
to conduct, at the Servicer’s expense, a review of the Servicer’s books and
records with respect to such Receivables.
(g)    Change in Lock-Box Banks, Lock-Box Accounts and Payment Instructions to
Obligors. The Servicer and, to the extent that it ceases to be the Servicer,
UGI, shall not (and shall not permit the Originator to) add or terminate any
bank as a Lock-Box Bank or any account as a Lock-Box Account (or any related
lock-box) from those listed in Schedule II to the Agreement, or make any change
in its instructions to Obligors regarding payments to be made to the Servicer or
any Lock-Box Account (or the related lock-box), unless the Administrator shall
have consented thereto in writing and the Administrator shall have received
copies of all agreements and documents (including Lock-Box Agreements) that it
may request in connection therewith.
(h)    Deposits to Lock-Box Accounts. The Servicer shall: (i) within 30 days of
the initial purchase hereunder, instruct all Obligors to make payments of all
Receivables to one or more Lock-Box Accounts or to the lock-boxes to which only
Lock-Box Banks have access (and shall instruct the Lock-Box Banks to cause all
items and amounts relating to such Receivables received in such lock-boxes to be
removed and deposited into a Lock-Box Account on a daily basis), and (ii)
deposit, or cause to be deposited, any Collections received by it into Lock-Box
Accounts not later than one Business Day after receipt thereof. Each Lock-Box
Account shall at all times be subject to a Lock-Box Agreement. The Servicer will
not (and will not permit the Originator to) deposit or otherwise credit, or
cause or permit to be so deposited or credited, to any Lock-Box Account cash or
cash proceeds other than (i) Collections and (ii) on payments received from
end-users payable to a Reseller in respect of product sold by such Reseller to
such end-user, provided that such payments do not remain on deposit in such
Lock-Box Account for more than two Business Days after deposit therein.
(i)    Marking of Records. At its expense, the Servicer shall mark its master
data processing records relating to Pool Receivables and related Contracts with
a legend evidencing that the undivided percentage ownership interests with
regard to the Purchased Interest related to such Receivables and related
Contracts have been sold in accordance with the Agreement.
(j)    Reporting Requirements. UGI shall provide to the Administrator (in
multiple copies, if requested by the Administrator) the following:
(i)    as soon as available and in any event within 50 days after the end of the
first three quarters of each fiscal year of UGI, balance sheets of UGI and its
consolidated Subsidiaries as of the end of such quarter and statements of
income, retained earnings and cash flow of UGI and its consolidated Subsidiaries
for the period commencing at the end of the previous fiscal year and ending with
the end of such quarter, certified by the chief financial officer of such
Person;
(ii)    as soon as available and in any event within 105 days after the end of
each fiscal year of such Person, a copy of the annual report for such year for
such Person and its consolidated Subsidiaries, containing financial statements
for such year audited by independent certified public accountants of nationally
recognized standing;

 
 
 

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(iii)    as to the Servicer only, as soon as available and in any event not
later than two Business Days prior to (A) the Settlement Date, an Information
Package as of the most recently completed calendar month, (B) any purchase made
pursuant to Section 1.2, an Information Package as of the most recent purchase,
or within six Business Days of a request by the Administrator, an Information
Package for such periods as is specified by the Administrator (including on a
semi-monthly, weekly or daily basis);
(iv)    as soon as possible and in any event within five Business Days after
becoming aware of the occurrence of each Termination Event or Unmatured
Termination Event, a statement of the chief financial officer of UGI setting
forth details of such Termination Event or Unmatured Termination Event and the
action that such Person has taken and proposes to take with respect thereto;
(v)    promptly after the sending or filing thereof, copies of (or notice
thereof if available on EDGAR) all reports that UGI sends to any of its security
holders, and copies of all reports and registration statements that UGI or any
Subsidiary files with the Securities and Exchange Commission; provided, that any
filings with the Securities and Exchange Commission that have been granted
“confidential” treatment shall be provided promptly after such filings have
become publicly available;
(vi)    promptly after the filing or receiving thereof, copies of all reports
and notices that UGI or any of its Affiliate files under ERISA with the Internal
Revenue Service, the Pension Benefit Guaranty Corporation or the U.S. Department
of Labor with respect to any Benefit Plan that is subject to Title IV of ERISA
or that UGI or any of its Affiliates receives with respect to any Benefit Plan
that is subject to Title IV of ERISA from any of the foregoing or from any
multiemployer plan (within the meaning of Section 4001(a)(3) of ERISA) to which
UGI or any of its Affiliate is or was, within the preceding five years, a
contributing employer, in each case in respect of the assessment of withdrawal
liability or an event or condition that could, in the aggregate, reasonably
result in the imposition of material liability on UGI and/or any such Affiliate;
(vii)    at least thirty days before any change in UGI’s or the Originator’s
name or any other change requiring the amendment of UCC financing statements, a
notice setting forth such changes and the effective date thereof;
(viii)    promptly after UGI obtains knowledge thereof, notice of any: (A)
litigation, investigation or proceeding that may exist at any time between UGI
or any of its Subsidiaries and any Governmental Authority that, if not cured or
if adversely determined, as the case may be, would have a Material Adverse
Effect; (B) litigation or proceeding adversely affecting UGI or any of its
Subsidiaries in which the amount involved is $1,000,000 or more and not covered
by insurance or in which injunctive or similar relief is sought; or (C)
litigation or proceeding relating to any Transaction Document;
(ix)    promptly after becoming aware thereof, notice of a material adverse
change in the business, operations, property or financial or other condition of
UGI or any of its Subsidiaries; and

 
 
 

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(x)    such other information respecting the Receivables or the condition or
operations, financial or otherwise, of UGI or any of its Affiliates as the
Administrator may from time to time reasonably request.
(k)     Net Worth. At any time of determination, the net worth (as adjusted to
eliminate the impact of any charges related to SFAS 133) of the Servicer shall
not be less than the lesser of (a) $93,000,000 or (b) $93,000,000 less an amount
equal to the sum of all dividends paid by the Servicer from June 30, 2004
through such time; provided, however, that at no time shall the net worth (as
adjusted above) of the Servicer (as reduced by all such dividends paid during
the period referred to above) be less than $40,000,000.
(l)    Anti-Money Laundering/International Trade Law Compliance. No Covered
Entity will become a Sanctioned Person. No Covered Entity, either in its own
right or through any third party, will (a) have any of its assets in a
Sanctioned Country or in the possession, custody or control of a Sanctioned
Person in violation of any Anti-Terrorism Law; (b) do business in or with, or
derive any of its income from investments in or transactions with, any
Sanctioned Country or Sanctioned Person in violation of any Anti-Terrorism Law;
(c) engage in any dealings or transactions prohibited by any Anti-Terrorism Law
or (d) use the proceeds of any purchase to fund any operations in, finance any
investments or activities in, or, make any payments to, a Sanctioned Country or
Sanctioned Person in violation of any Anti-Terrorism Law. The funds used to
repay Servicer’s obligations under this Agreement and each of the other
Transaction Documents will not be derived from any unlawful activity. Each
Covered Entity shall comply with all Anti-Terrorism Laws. Servicer shall
promptly notify the Administrator in writing upon the occurrence of a Reportable
Compliance Event.
3.    Separate Existence. Each of the Seller and UGI hereby acknowledges that
the Issuer 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 UGI and its Affiliates.
Therefore, from and after the date hereof, each of the Seller and UGI shall take
all steps specifically required by the Agreement or reasonably required by the
Administrator 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 UGI and any other Person, and is not a
division of UGI, 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 UGI shall take such actions
as shall be required in order that:
(a)    The Seller will be a limited purpose corporation whose primary activities
are restricted in its certificate of incorporation to: (i) purchasing or
otherwise acquiring from the Originator (or its Affiliates), owning, holding,
granting security interests or selling interests in Pool Assets (or other
receivables originated by the Originator or its Affiliates, and certain related
assets), (ii) entering into agreements for the selling and servicing of the
Receivables Pool (or other receivables pools originated by the Originator or its
Affiliates), and (iii) conducting such other activities as it deems necessary or
appropriate to carry out its primary activities;
(b)    The Seller shall not engage in any business or activity, or incur any
indebtedness or liability, other than as expressly permitted by the Transaction
Documents;

 
 
 

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(c)    Not less than one member of the Seller’s Board of Directors (the
“Independent Director”) shall be an individual who is not a direct, indirect or
beneficial stockholder, officer, director, employee, affiliate, associate or
supplier of UGI, or any of their Affiliates. The certificate of incorporation of
the Seller shall provide that: (i) 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 (ii) such provision cannot be amended without the prior written consent of
the Independent Director;
(d)    The Independent Director shall not at any time serve as a trustee in
bankruptcy for the Seller, UGI or any Affiliate thereof;
(e)    Any employee, consultant or agent of the Seller will be compensated from
the Seller’s funds for services provided to the Seller. 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;
(f)    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 pay the Servicer the Servicing Fee pursuant hereto. The Seller will not
incur any material indirect or overhead expenses for items shared with UGI (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 or the manager’s fee, such as legal,
auditing and other professional services, such expenses will be allocated to the
extent practical on the basis of actual use or the value of services rendered,
and otherwise on a basis reasonably related to the actual use or the value of
services rendered; it being understood that UGI shall pay all expenses relating
to the preparation, negotiation, execution and delivery of the Transaction
Documents, including legal, agency and other fees;
(g)    The Seller’s operating expenses will not be paid by UGI, or any other
Affiliate thereof;
(h)    All of the Seller’s business correspondence and other communications
shall be conducted in the Seller’s own name and on its own separate stationery;
(i)    The Seller’s books and records will be maintained separately from those
of UGI and any other Affiliate thereof;
(j)    All financial statements of UGI or any Affiliate thereof that are
consolidated to include Seller will contain detailed notes clearly stating that:
(i) a special purpose corporation exists as a Subsidiary of UGI, (ii) the
Originator has sold receivables and other related assets to such special purpose
Subsidiary that, in turn, has sold undivided interests therein to certain
financial institutions and other entities and (iii) that the special purpose
Subsidiary’s assets are not available to satisfy the obligations of UGI or any
Affiliate;

 
 
 

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(k)    The Seller’s assets will be maintained in a manner that facilitates their
identification and segregation from those of UGI or any Affiliate thereof;
(l)    The Seller will strictly observe corporate formalities in its dealings
with UGI, or any Affiliate thereof, and funds or other assets of the Seller will
not be commingled with those of UGI, or any Affiliate thereof except as
permitted by the Agreement in connection with servicing the Pool Receivables.
The Seller shall not maintain joint bank accounts or other depository accounts
to which UGI or any Affiliate thereof (other than UGI in its capacity of
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 (other than
directors and officers liability and credit insurance policies) with respect to
any loss relating to the property of UGI or any Subsidiary or other Affiliate of
UGI. 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;
(m)     The Seller will maintain arm’s-length relationships with UGI (and any
Affiliate 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 nor UGI 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 UGI 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
(n)    UGI shall not pay the salaries of Seller’s employees, if any.

 
 
 

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EXHIBIT V
TERMINATION EVENTS

Each of the following shall be a “Termination Event”:
(a)    (i) the Seller, UGI, the Originator or the Servicer (if UGI or any of its
Affiliates) shall fail to perform or observe in any material respect any term,
covenant or agreement under the Agreement or any other Transaction Document and,
except as otherwise provided herein, such failure shall continue for thirty days
after knowledge or notice thereof, (ii) the Seller or the Servicer shall fail to
make when due any payment or deposit to be made by it under the Agreement and
such failure shall continue unremedied for two (2) Business Days or (iii) UGI
shall resign as Servicer, and no successor Servicer reasonably satisfactory to
the Administrator shall have been appointed;
(b)    UGI (or any Affiliate thereof) shall fail to transfer to any successor
Servicer when required any rights pursuant to the Agreement that UGI (or such
Affiliate) then has as Servicer;
(c)    any representation or warranty made or deemed made by the Seller, UGI or
the Originator (or any of their respective officers) under or in connection with
the Agreement or any other Transaction Document, or any written information or
report delivered by the Seller, UGI or the Originator or the Servicer pursuant
to the Agreement or any other Transaction Document, shall prove to have been
incorrect or untrue in any respect when made or deemed made (pursuant to
paragraph 2(b) of Exhibit II hereof or with respect to any Information Package)
or delivered; provided, however, if the violation of this paragraph (c) by the
Seller or the Servicer may be cured without any potential or actual detriment to
the Issuer or the Administrator, the Seller or the Servicer, as applicable,
shall have 30 days from the earlier of (i) such Person’s knowledge of such
failure and (ii) notice to such Person of such failure to cure any such
violation, before a Termination Event shall occur so long as such Person is
diligently attempting to effect such cure;
(d)    the Seller or the Servicer shall fail to deliver the Information Package
pursuant to the Agreement, and such failure shall remain unremedied for two
Business Days;
(e)    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 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 Issuer 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;
(f)    the Seller, UGI or the 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, UGI or the
Originator seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the

 
 
 

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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, UGI or the
Originator shall take any corporate action to authorize any of the actions set
forth above in this paragraph;
(g)    (i) the (A) Default Ratio shall exceed 2.75% or (B) Delinquency Ratio
shall exceed 10.0% or (ii) the average for three consecutive calendar months of
(A) the Default Ratio shall exceed 2.00%, (B) the Delinquency Ratio shall exceed
9.0%, (C) the Dilution Ratio shall exceed 1.75% or (iii) Days’ Sales Outstanding
exceeds 45 days;
(h)    a Change in Control shall occur with respect to the Seller, the
Originator or UGI,
(i)    at any time (i) the sum of (A) the Capital plus (B) the Total Reserves,
exceeds (ii) the sum of (A) the Net Receivables Pool Balance at such time plus
(B) the Issuer’s 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 five (5)
Business Days of becoming aware thereof;
(j)    (i) UGI or any of its Subsidiaries shall fail to pay any principal of or
premium or interest on any of its Debt that is outstanding in a principal amount
of at least $5,000,000 in the aggregate when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace period,
if any, specified in the agreement, mortgage, indenture or instrument relating
to such Debt (and shall have not been waived); or (ii) any other event shall
occur or condition shall exist under any agreement, mortgage, indenture or
instrument relating to any such Debt and shall continue after the applicable
grace period, if any, specified in such agreement, mortgage, indenture or
instrument (and shall have not been waived), if, in either case: (a) the effect
of such non-payment, event or condition is to give the applicable debt holders
the right (whether acted upon or not) to accelerate the maturity of such Debt,
or (b) any such Debt shall be declared to be due and payable, or required to be
prepaid (other than by a regularly scheduled required prepayment), redeemed,
purchased or defeased, or an offer to repay, redeem, purchase or defease such
Debt shall be required to be made, in each case before the stated maturity
thereof;
(k)    either: (i) a contribution failure shall occur with respect to any
Benefit Plan sufficient to give rise to a lien under Section 302(f) of ERISA,
(ii) the Internal Revenue Service shall file a notice of lien asserting a claim
or claims pursuant to the Internal Revenue Code with regard to any of the assets
of Seller, the Originator or any ERISA Affiliate and such lien shall have been
filed and not released within 10 days, or (iii) the Pension Benefit Guaranty
Corporation shall, or shall indicate its intention in writing to the Seller, the
Originator or any ERISA Affiliate to, either file a notice of lien asserting a
claim pursuant to ERISA with regard to any assets of the Seller, the Originator
or any ERISA Affiliate or terminate any Benefit Plan subject to Title IV of
ERISA that has unfunded benefit liabilities, or any steps shall have been taken
to terminate any Benefit Plan subject to Title

 
 
 

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IV of ERISA that has unfunded benefit liabilities so as to result in any
material liability to the Seller or the Originator and such lien shall have been
filed and not released within 10 days;
(l)    (i) one or more final and unappealable judgments for the payment of money
shall be entered against the Seller or (ii) one or more final and unappealable
judgments for the payment of money in an amount in excess of $20,000,000,
individually or in the aggregate, shall be entered against the Servicer or the
Originator on claims not covered by insurance or as to which the insurance
carrier has denied its responsibility, and such judgment shall continue
unsatisfied and in effect for sixty (60) consecutive days without a stay of
execution; or
(m)    [RESERVED]; or
(n)    the “Purchase and Sale Termination Date” under and as defined in the
Purchase and Sale Agreement shall occur under the Purchase and Sale Agreement or
the Originator shall for any reason cease to transfer, or cease to have the
legal capacity to transfer, or otherwise be incapable of transferring
Receivables to the Seller under the Purchase and Sale Agreement.

 
 
 

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EXHIBIT VI
SUPPLEMENTAL PERFECTION REPRESENTATIONS,
WARRANTIES AND COVENANTS
In addition to the representations, warranties and covenants contained in
Exhibit III hereof, the Seller hereby makes the following additional
representations, warranties and covenants:
1.    Receivables; Lock‑box Accounts.
(a)    The Pool Receivables constitute “accounts”, “general intangibles” or
“tangible chattel paper”, each within the meaning of the applicable UCC.
(b)    Lock‑Box Accounts. Each Lock‑Box Account constitutes a “deposit account”
within the meaning of the applicable UCC.
2.    Creation of Security Interest. The Seller owns and has good and marketable
title to the Pool Receivables and Lock‑Box Accounts (and the related
lock-boxes), free and clear of any Adverse Claim. The Agreement creates a valid
and continuing security interest (as defined in the applicable UCC) in the Pool
Receivables and the Lock‑Box Accounts (and the related lock-boxes) in favor of
the Issuer, which security interest is prior to all other Adverse Claims and is
enforceable as such as against any creditors of and purchasers from the Seller.
3.    Perfection.
(a)    General. The Seller has or has caused, or will or will cause within ten
days after the date hereof, the filing of all appropriate financing statements
in the proper filing office in the appropriate jurisdictions under applicable
law in order to perfect the sale of the Pool Receivables from the Originator to
the Seller pursuant to the Purchase and Sale Agreement and the security interest
granted by the Seller to the Issuer in the Receivables and Lock‑Box Accounts
(and the related lock-boxes) hereunder.
(b)    Tangible Chattel Paper. With respect to any Pool Receivable that
constitutes “tangible chattel paper”, the Servicer is in possession of the
original copies of the tangible chattel paper that constitute or evidence such
Pool Receivables, and the Seller has filed or has caused the Originator to file,
or will file or will cause the Originator to file within ten days after the date
hereof, the financing statements described in paragraph (a) above, each of which
will contain a statement that: “A purchase of or a grant of a security interest
in any property described in this financing statement will violate the rights of
the Issuer.” The Pool Receivables to the extent they are evidenced by “tangible
chattel paper” do not have any marks or notations indicating that they have been
pledged, assigned or otherwise conveyed to any Person other than the Seller or
the Issuer.
(c)    Lock‑Box Accounts. With respect to all Lock‑Box Accounts (and all related
lock-boxes), the Seller has delivered to the Administrator, on behalf of the
Issuer, a fully executed Lock‑Box Agreement pursuant to which the applicable
Lock‑Box Bank has agreed, following the occurrence and continuation of a
Termination Event, to comply with all instructions given by the

 
 
 

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Administrator with respect to all funds on deposit in such Lock‑Box Account (and
all funds sent to the respective lock-box), without further consent by the
Seller or the Servicer.
4.    Priority.
(a)    Other than the transfer of the Receivables by the Originator to the
Seller pursuant to the Purchase and Sale Agreement and the grant of security
interest by the Seller to the Issuer in the Pool Receivables and Lock‑Box
Accounts (and the related lock-boxes) hereunder, neither the Seller nor the
Originator has pledged, assigned, sold, conveyed, or otherwise granted a
security interest in any of the Pool Receivables or Lock‑Box Accounts (and the
related lock-boxes) to any other Person.
(b)    Neither the Seller nor the Originator has authorized, or is aware of, any
filing of any financing statement against the Seller or the Originator that
includes a description of collateral covering the Pool Receivables or any other
Pool Assets, other than any financing statement filed pursuant to the Purchase
and Sale Agreement and the Agreement or financing statements that have been
validly terminated prior to the date hereof.
(c)    The Seller is not aware of any judgment, ERISA or tax lien filings
against either the Seller or the Originator.
(d)    None of the Lock‑Box Accounts (and the related lock-boxes) are in the
name of any Person other than the Seller or the Issuer. None of the Seller, the
Servicer or the Originator has consented to any Lock‑Box Bank’s complying with
instructions of any person other than the Administrator.
5.    Survival of Supplemental Representations. Notwithstanding any other
provision of the Agreement or any other Transaction Document, the
representations contained in this Exhibit VI shall be continuing, and remain in
full force and effect until such time as all the Capital has finally been paid
in full and all other obligations of the Seller under the Agreement or any other
Transaction Documents have been fully performed.
6.    [Reserved].
7.    Seller to Maintain Perfection and Priority. In order to evidence the
interests of the Issuer under this Agreement, the Seller shall, from time to
time take such action, or execute and deliver such instruments (other than
filing financing statements) as may be necessary or advisable (including,
without limitation, such actions as are requested by the Administrator on behalf
of the Issuer) to maintain and perfect, as a first‑priority interest, the
Issuer’s security interest in the Pool Assets. The Seller 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 Issuer’s security interest in the Pool Assets as a first‑priority
interest. The Administrator’s approval of such filings shall authorize the
Seller to file such financing statements under the UCC without the signature of
the Seller, the Originator or the Issuer where allowed by applicable law.
Notwithstanding anything

 
 
 

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else in the Transaction Documents to the contrary, neither the Seller, the
Servicer, nor the Originator, shall 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,
without the prior written consent of the Administrator, on behalf of the Issuer.

 
 
 

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SCHEDULE I
CREDIT AND COLLECTION POLICY

 
 
 

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SCHEDULE II
LOCK-BOX BANKS AND LOCK-BOX ACCOUNTS

Lock-Box Bank
Seller
Lock Box No.
Account No.
PNC Bank, National Association
Energy Services Funding Corporation
XXXXXXXXX
XXXXXXXXXX

 
 
 

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SCHEDULE III
TRADE NAMES

Corporate Name 

Energy Services Funding Corporation
Trade Names / Fictitious Names 

None

 
 
 

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SCHEDULE IV
LOCATION OF RECORDS OF SELLER

460 North Gulph Road
King of Prussia, Pennsylvania 19406-2815

1 Meridian Boulevard
Reading, Pennsylvania 19610

 
 
 

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ANNEX A-1
to Receivables Purchase Agreement

FORM OF INFORMATION PACKAGE (Settlement Date)

 
 
 

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ANNEX A-2
to Receivables Purchase Agreement

FORM OF INFORMATION PACKAGE (Inter-Settlement Date)

 
 
 

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ANNEX B
to Receivables Purchase Agreement

FORM OF PURCHASE NOTICE

 
 
 

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FORM OF PURCHASE NOTICE
________, [20__]
PNC Bank, National Association
Three PNC Plaza
225 Fifth Avenue
Pittsburgh, PA 15222-2707
Ladies and Gentlemen:
Reference is hereby made to the Receivables Purchase Agreement, dated as of
November 30, 2001 (as heretofore amended or supplemented, the “Receivables
Purchase Agreement”), among Energy Services Funding Corporation (“Seller”), UGI
Energy Services, LLC, as Servicer and PNC Bank, National Association, as issuer
(the “Issuer”) and as administrator (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 pursuant to the
Receivables Purchase Agreement an undivided variable percentage interest in a
pool of receivables on [                  , 20__], for a Purchase Price of
$____________. Subsequent to this purchase, the aggregate outstanding Capital
will be $___________. The pro forma calculation of the Purchased Interest after
giving effect to the increase in Capital is [_______________].
Seller hereby represents and warrants as of the date hereof, and as of the date
of purchase, as follows:
(i)    the representations and warranties contained in Exhibit III of the
Receivables Purchase Agreement are correct in all respects on and as of such
dates as though made on and as of such dates and shall be deemed to have been
made (pursuant to paragraph 2(b) of Exhibit II of the Receivables Purchase
Agreement) on such dates (except to the extent that such representations and
warranties relate expressly to an earlier date, and in which case such
representations and warranties shall be true and correct in all respects as of
such earlier date);
(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 Purchased
Interest will not exceed 100% and the Capital will not exceed the Purchase
Limit;
(iv)    no Default Event shall have occurred and is continuing; and
(v)    the Facility Termination Date shall not have occurred.

 
 
 

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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.

ENERGY SERVICES FUNDING CORPORATION
By:    
Name Printed:    
Title:    

 
 
 

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ANNEX C
to Receivables Purchase Agreement

FORM OF PAYDOWN NOTICE

 
 
 

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FORM OF PAYDOWN NOTICE

______________, _____

PNC Bank, National Association
225 Fifth Avenue
Pittsburgh, New York 15222-2707
Attention: William Falcon
Ladies and Gentlemen:
Reference is hereby made to the Receivables Purchase Agreement, dated as of
November 30, 2001 (as amended, supplemented or otherwise modified, the
“Receivables Purchase Agreement”), among Energy Services Funding Corporation, as
Seller, UGI Energy Services, LLC, as Servicer and PNC Bank, National
Association, as Issuer and 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 Capital on
____________, _____1 by the application of $___________ in cash to pay Capital
and Discount to accrue through such date with respect to such Capital, together
with all costs related to such reduction of Capital.

1 Notice must be given (i) at least one Business Day prior to the requested
paydown date, in the case of reductions of greater than $1,000,000 and less than
or equal to $3,000,000; (ii) at least two Business Days prior the requested
paydown date, in the case of reductions of greater than $3,000,000 and less than
or equal to $10,000,000; and (ii) at least five Business Days prior to the
requested paydown date, in the case of reductions of greater than $10,000,000.

 
 
 

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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.
ENERGY SERVICES FUNDING CORPORATION
By:    
Name:    
Title:    
Receivables Purchase Agreement
(UGI)

 
 
 

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TABLE OF CONTENTS

ARTICLE I.
AMOUNTS AND TERMS OF THE PURCHASES
Section 1.1
Purchase
Facility............................................................................1

Section 1.2
Making
Purchases..........................................................................1

Section 1.3
Purchased Interest
Computation....................................................2

Section 1.4
Settlement
Procedures....................................................................3

Section 1.5
Fees................................................................................................6

Section 1.6
Payments and Computations,
Etc..................................................6

Section 1.7
Increased
Costs..............................................................................6

Section 1.8
Requirements of
Law.....................................................................7

Section 1.9
Inability to Determine
LMIR.........................................................8

ARTICLE II.
REPRESENTATIONS AND WARRANTIES; COVENANTS; TERMINATION EVENTS
Section 2.1
Representations and Warranties; Covenants...................................9

Section 2.2
Termination
Events.........................................................................9

ARTICLE III.
INDEMNIFICATION
Section 3.1
Indemnities by the
Seller................................................................9

Section 3.2
Indemnities by the
Servicer...........................................................11

Section 3.3
Notice of
Claims............................................................................11

ARTICLE IV.
ADMINISTRATION AND COLLECTIONS
Section 4.1
Appointment of the
Servicer..........................................................12

Section 4.2
Duties of the
Servicer.....................................................................12

Section 4.3
Lock-Box
Arrangements................................................................13

Section 4.4
Enforcement
Rights........................................................................14

Section 4.5
Responsibilities of the
Seller..........................................................15

Section 4.6
Servicing
Fee..................................................................................15

ARTICLE V.
MISCELLANEOUS
Section 5.1
Amendments,
Etc............................................................................15

Section 5.2
Notices,
Etc.....................................................................................16

Section 5.3
Assignability...................................................................................16

Section 5.4
Costs, Expenses and
Taxes.............................................................17

Section 5.5
[Reserved].......................................................................................18

Section 5.6
Confidentiality.................................................................................18

Section 5.7
GOVERNING LAW AND JURISDICTION..................................18

Section 5.8
Execution in
Counterparts...............................................................18

Section 5.9
Survival of
Termination...................................................................19

 
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Section 5.10
WAIVER OF JURY TRIAL..........................................................19

Section 5.11
Entire
Agreement...........................................................................19

Section 5.12
Headings........................................................................................19

Section 5.13
Issuer’s, Administrator’s, Seller’s and Servicer’s Liabilities.........19

Section 5.14
Purchase
Option.............................................................................19

EXHIBIT I        Definitions
EXHIBIT II        Conditions of Purchases
EXHIBIT III        Representations and Warranties
EXHIBIT IV        Covenants
EXHIBIT V        Termination Events
EXHIBIT VI        Supplemental Perfection Representations, Warranties and
Covenants
SCHEDULE I        Credit and Collection Policy
SCHEDULE II    Lock-Box Banks and Lock-Box Accounts
SCHEDULE III    Trade Names
SCHEDULE IV    Location of Records of Seller
ANNEX A-1        Form of Information Package (Settlement Date)
ANNEX A-2        Form of Information Package (Inter-Settlement Date)
ANNEX B        Form of Purchase Notice
ANNEX C        Form of Paydown Notice

 
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