Exhibit 10.2

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Purchase and Sale Agreement
 
Dated as of May 31, 2012
 
between
 
KCP&L Greater Missouri Operations Company,
as Originator,
 
and
 
GMO Receivables Company,
as Buyer

 
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Table of Contents
 
 
Section
 
Heading
Page
Section 1.
 
Definitions and Related Matters
1
Section 1.1.
Defined Terms
1
Section 1.2.
 
Other Interpretive Matters
2
Section 2.
 
Agreement to Contribute, Purchase and Sell
2
Section 2.1.
Purchase and Sale
2
Section 2.2.
Timing of Contribution, Purchases
2
Section 2.3.
Purchase Price
3
Section 2.4.
 
No Recourse or Assumption of Obligations
3
Section 3.
 
Administration and Collection
4
Section 3.1.
Originator to Act as Collection Agent
4
Section 3.2.
Deemed Collections
4
Section 3.3.
Application of Collections
5
Section 3.4.
 
Responsibilities of Originator
5
Section 4.
 
Representations and Warranties
5
Section 4.1.
Mutual Representations and Warranties
5
Section 4.2.
 
Additional Representations by Originator
6
Section 5.
 
General Covenants
8
Section 5.1.
Covenants
8
Section 5.2.
 
Organizational Separateness
12
Section 6.
 
Termination of Contributions and Purchases
12
Section 6.1.
Voluntary Termination
12
Section 6.2.
 
Automatic Termination
12
Section 7.
 
Indemnification
12
Section 7.1.
Originator’s Indemnity
12
Section 7.2.
Indemnification Due to Failure to Consummate Purchase
14
Section 7.3.
 
Other Costs
15
Section 8.
 
Miscellaneous
15
Section 8.1.
Amendments, Waivers, etc
15
Section 8.2.
Assignment of Purchase and Sale Agreement
15
Section 8.3.
Binding Effect; Assignment
16
Section 8.4.
Survival
16

 
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Section 8.5.
Costs, Expenses and Taxes
16
Section 8.6.
Execution in Counterparts; Integration
16
Section 8.7.
Governing Law; Submission to Jurisdiction
16
Section 8.8.
No Proceedings
16
Section 8.9.
Loans by Buyer to Originator
16
Section 8.10.
Notice
17
Section 8.11.
Entire Agreement
17
Section 8.12.
Confidentiality
17
Section 8.13.
Waiver of Trial by Jury
17
 
Signature
 
18

 
Exhibit A    Purchase Price

 

 
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This Purchase and Sale Agreement dated as of May 31, 2012 (this “Agreement”) is
between KCP&L Greater Missouri Operations Company, a Delaware corporation
(“Originator”), and GMO Receivables Company, a Delaware corporation
(“Buyer”).  The parties agree as follows:
 
 
Section 1.  Definitions and Related Matters.

 
Section 1.1. Defined Terms.  In this Agreement, unless otherwise specified or
defined herein: (a) capitalized terms are used as defined in Schedule I to the
Receivables Sale Agreement dated as of the date hereof (as amended or modified
from time to time, the “Second Tier Agreement”) among Buyer, Originator, as the
Initial Collection Agent, The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York
Branch, as the Agent, and Victory Receivables Corporation, as such agreement may
be amended or modified from time to time; and (b) terms defined in Article 9 of
the UCC and not otherwise defined herein are used as defined in such Article 9.
 
In addition, the following terms will have the meanings specified below:
 
“Available Funds” is defined in Section 2.3(b) hereof.
 
 “Closing Date” means the date on which this Agreement and the Second Tier
Agreement become effective in accordance with their terms.
 
“Collection Agent Fee“ is defined in Section 3.6 of the Second Tier Agreement.
 
“Contributed Receivables” is defined in Section 2.2 hereof.
 
“Credit Agreement” means the Credit Agreement, dated as of August 9, 2010, among
Originator, Great Plains Energy Incorporated, certain lenders party thereto,
Bank of America, N.A., as Administrative Agent, and Union Bank, N.A. and Wells
Fargo Bank, National Association, as Syndication Agents, The Royal Bank of
Scotland PLC and BNP Paribas, as Documentation Agents, Banc of America
Securities LLC, Union Bank, N.A. and Wells Fargo Securities, LLC as Joint Lead
Arrangers and Joint Book Managers, as amended by the First Amendment to Credit
Agreement dated as of December 9, 2011 among Originator, Great Plains Energy
Incorporated, certain lenders party thereto, Union Bank, N.A. and Wells Fargo
Bank, National Association, as Syndication Agents, Bank of America, N.A., as
Administrative Agent, The Royal Bank of Scotland PLC and BNP Paribas, as
Documentation Agents, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Union
Bank, N.A. and Wells Fargo Securities, LLC as Joint Lead Arrangers and Joint
Book Managers.
 
“Excluded Losses” is defined in Section 7.1 hereof.
 
“Initial Funding Date” means June 1, 2012, which is the date of the first
purchase by Buyer from Originator, and the first contribution by Originator to
Buyer under this Agreement.

 
 

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“Settlement Date” means, with respect to each calendar month, the second
Business Day after the Monthly Report Date for such calendar month; provided,
however, that upon the occurrence and during the continuation of a Termination
Event, the Settlement Date shall be a Business Day each calendar month as
designated by the Agent.
 
“Settlement Period” means with respect to each Settlement Date, the calendar
month preceding such Settlement Date (or, in the case of the first Settlement
Period, the period from the Initial Funding Date to the end of the calendar
month in which the Initial Funding Date occurs); provided, however, that upon
the occurrence and during the continuation of a Termination Event, the Agent
upon prior written notice to Originator and Buyer, may change the Settlement
Period to be the period from a specified day during one calendar month to the
same specified day during the following calendar month (e.g., a Settlement
Period running from the 10th calendar day of one month to the 10th calendar day
of the following month).
 
“Total Capitalization” shall have the meaning set forth in the Credit Agreement
as of the date hereof.
 
“Total Indebtedness” shall have the meaning set forth in the Credit Agreement as
of the date hereof.
 
Section 1.2. Other Interpretive Matters.  In this Agreement, unless otherwise
specified:  (a) references to any Section or Annex refer to such Section of, or
Annex to, this Agreement, and references in any Section or definition to any
subsection or clause refer to such subsection or clause of such Section or
definition; (b) “herein”, “hereof”, “hereto”, “hereunder” and similar terms
refer to this Agreement as a whole and not to any particular provision of this
Agreement; (c) “including” means including without limitation, and other forms
of the verb “to include” have correlative meanings; (d) the word “or” is not
exclusive; and (e) captions are solely for convenience of reference and shall
not affect the meaning of this Agreement.
 
 
Section 2.  Agreement to Contribute, Purchase and Sell.

 
Section 2.1. Purchase and Sale.  On the terms and subject to the conditions set
forth in this Agreement, Originator hereby sells and contributes to Buyer, and
Buyer hereby purchases and accepts each such contribution from Originator, all
of Originator’s right, title and interest in, to and under the Receivables, all
Related Security and all proceeds thereof (including all Collections with
respect thereto), in each case whether now existing or hereafter arising or
acquired.  The proceeds with respect to each Receivable (including all
Collections with respect thereto) are sold or contributed by Originator to Buyer
together with such Receivable, whether such proceeds (or Collections) exist at
such time or arise or are acquired thereafter.
 
Section 2.2. Timing of Contribution, Purchases.  Originator hereby, pursuant to
the terms hereof and the terms of the Stockholder and Subscription Agreement
between Originator and Buyer dated as of May 31, 2012, has agreed to contribute
$1,800,000 in cash as an initial capital contribution to Buyer, it being
understood that in lieu of a payment of such capital contribution in cash,
Originator hereby agrees that Buyer may net from the purchase price

 
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payable to the Originator on the Initial Funding Date the amount of such capital
contribution and pay to the Originator the excess of such purchase price over
such capital contribution.  After the Initial Funding Date, upon the creation of
each Receivable, it shall immediately, and without further action by any Person,
be sold to Buyer pursuant to Section 2.3 or contributed by Originator to Buyer
(each a “Contributed Receivable”).  
 
Section 2.3. Purchase Price.  (a) The aggregate purchase price for the portion
of the Receivables sold on the Initial Funding Date shall be such amount as
agreed upon prior to the Initial Funding Date between Originator and Buyer,
which shall be the fair market value of such Receivables on such date, and which
shall equal the excess of the (i) estimated aggregate outstanding balance of
such Receivables over (ii) the sum of (x) the bad debt reserves maintained by
the Originator and (y) a discount agreed upon by Buyer and Originator
representing the uncertainty of payment and cost of purchase of such
Receivables.  The purchase price for Receivables subsequently sold by Originator
to Buyer shall be calculated in accordance with the provisions set forth in
Exhibit A hereto.
 
(b)On the Initial Funding Date, Buyer shall pay Originator the purchase price
for the portion of the Receivables sold on that date, which shall be the fair
market value of such Receivables on such date, as follows:  First, the Buyer
shall pay to the Originator cash in the amount of the net proceeds received from
the sale of the Purchase Interest under the Second Tier Agreement and Second,
the remainder shall be paid by the Buyer borrowing an initial advance under the
promissory note (as amended or modified from time to time, the “Subordinated
Note”) executed and delivered by Buyer to the order of Originator as of the
Initial Funding Date.  On each Business Day after the Initial Funding Date on
which Originator sells any Receivables to Buyer pursuant to the terms of
Section 2.1, until the termination of the purchase and sale of Receivables under
Section 6 hereof, Buyer shall pay to Originator the purchase price of such
Receivables (i) by depositing into such account as Originator shall specify
immediately available funds from monies then held by or on behalf of Buyer
(solely to the extent that such monies do not constitute Collections that are
required to be identified or are deemed to be held by the Collection Agent
pursuant to the Second Tier Agreement for the benefit of, or required to be
distributed to, the Agent or the Buyer or required to be paid to the Collection
Agent as the Collection Agent Fee, or otherwise necessary to pay current
expenses of Buyer (in its reasonable discretion)) (such available monies, the
“Available Funds”) and provided that Originator has paid all amounts then due by
Originator hereunder or (ii) by increasing the principal amount owed to
Originator under the Subordinated Note.  Any Receivables that are not paid for
by either of these methods shall constitute Contributed Receivables.  The
outstanding principal amount owed to Originator under the Subordinated Note may
be reduced from time to time as provided in Section 3.2 hereof or by payments
made by Buyer to Originator from Available Funds, provided that Originator has
paid all amounts then due by Originator hereunder.  Originator shall make all
appropriate record keeping entries with respect to amounts due to Originator
under the Subordinated Note to reflect payments by Buyer thereon and increases
of the principal amount thereof, and Originator’s books and records shall
constitute rebuttable presumptive evidence of the principal amount of and
accrued interest owed to Originator under the Subordinated Note.
 
Section 2.4. No Recourse or Assumption of Obligations.  Except to the limited
extent specifically provided in this Agreement, the contribution, purchase and
sale of Receivables under

 
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this Agreement shall be without recourse to Originator.  Originator and Buyer
intend the transactions hereunder to constitute absolute, irrevocable and
unconditional true sales, transfers and/or capital contributions, as applicable,
of Receivables by Originator to Buyer, providing Buyer with the full risks and
benefits of ownership of the Receivables (such that the Receivables would not be
property of Originator’s estate in the event of Originator’s bankruptcy).  If,
however, despite the intention of the parties, the conveyances provided for in
this Agreement are determined not to be true sales, absolute transfers and/or
capital contributions, as applicable, of Receivables from Originator to Buyer,
then this Agreement shall also be deemed to be a “security agreement” within the
meaning of Article 9 of the UCC and Originator hereby grants to Buyer a
“security interest” within the meaning of Article 1 of the UCC in all of
Originator’s right, title and interest in and to such Receivables (including the
proceeds thereof), now existing and thereafter created, to secure a non-recourse
loan in an amount equal to the aggregate purchase prices therefor and each of
Originator’s other payment obligations (including the obligation to remit to
Buyer all Collections of all Receivables) under this Agreement.
 
Buyer shall not have any obligation or liability with respect to any Receivable,
nor shall Buyer have any obligation or liability to any Obligor or other
customer or client of Originator (including any obligation to perform any of the
obligations of Originator under any Receivable).
 
 
Section 3.  Administration and Collection.

 
Section 3.1. Originator to Act as Collection Agent.  Notwithstanding the sale or
contribution of Receivables pursuant to this Agreement, Originator shall be
retained under the Second Tier Agreement to serve as Collection Agent with
respect to the Receivables.  In its capacity as Collection Agent, Originator
will continue to be responsible for the servicing, administration and collection
of the Receivables, all on the terms set out in (and subject to any rights to
terminate Originator as Collection Agent pursuant to) the Second Tier Agreement.
 
Section 3.2. Deemed Collections.  If on any day the outstanding balance of a
Receivable sold hereunder is reduced or cancelled as a result of any defective
or rejected goods or services, any cash discount or adjustment (including as a
result of the application of any special refund or other discounts or any
reconciliation), any setoff, credit or bona fide dispute (whether such claim or
credit, bona fide dispute arises out of the same, a related, or an unrelated
transaction); provided, however, that such reductions or cancellations shall not
include any amounts arising from the credit risk of the related Obligor, or the
refusal or the financial inability of the related Obligor, to pay undisputed
indebtedness, (i) Originator shall be deemed to have received on such day a
Collection on such Receivable in the amount of such reduction or cancellation
and (ii) such Receivable shall thereupon be, or be deemed to be reconveyed to
Originator.  If on any day any representation, warranty, covenant or other
agreement of Originator related to a Receivable is discovered to have been
untrue or not satisfied in any material respect as of the date such Receivable
was sold or contributed hereunder, (i) Originator shall be deemed to have
received on such day a Collection in the amount of the outstanding balance of
such Receivable and (ii) such Receivable shall thereupon be, or be deemed to be
reconveyed to Originator.  After Originator is deemed pursuant to this
Section 3.2 to have received any Collections, Originator shall transfer to
Buyer, in immediately available funds, the amount of such Deemed Collections on
the date that is the later to occur of (i) the Settlement Date following such
deemed receipt and (ii) the second

 
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Business Day following such deemed receipt; provided, however, that if no such
application is required under the Second Tier Agreement, Buyer and Originator
may agree to reduce the outstanding principal amount of the Subordinated Note in
lieu of all or part of such transfer.  To the extent that Buyer subsequently
collects any payment with respect to any such Receivable that was previously
reconveyed to Originator, Buyer shall pay Originator an amount equal to the
amount so collected, such amount to be payable on the date that is the later to
occur of (i) the Settlement Date following receipt of such amount and (ii) the
second Business Day following such receipt of such amount.
 
Section 3.3. Application of Collections.  Any payment by an Obligor in respect
of any indebtedness owed by it with respect to any Receivable or otherwise owed
by it to Originator shall, except as otherwise specified by such Obligor
(including by reference to a particular invoice), or required by the related
contracts or law, be applied, first, as a Collection of any Receivable or
Receivables then outstanding of such Obligor in the order of the age of such
Receivables, starting with the oldest of such Receivables, and, second, to any
other indebtedness of such Obligor to Originator.
 
Section 3.4. Responsibilities of Originator.  Originator shall pay when due all
Taxes payable in connection with the Receivables or their creation or
satisfaction.  Originator shall perform all of its obligations under agreements
related to the Receivables to the same extent as if interests in the Receivables
had not been transferred hereunder.  The Agent’s or the Buyer’s exercise of any
rights hereunder or under the Second Tier Agreement shall not relieve Originator
from such obligations.  Neither the Agent nor the Buyer shall have any
obligation to perform any obligation of Originator or any other obligation
(other than the obligation to act in good faith and with commercial
reasonableness) or liability in connection with the Receivables.
 
 
Section 4.  Representations and Warranties.

 
Section 4.1. Mutual Representations and Warranties.  Each of Originator and
Buyer represents and warrants to the other with respect to itself as follows:
 
(a)Existence and Power.  It is a corporation, duly organized, validly existing
and in good standing under the laws of its state of incorporation and has all
corporate power and authority and all governmental licenses, authorizations,
consents and approvals required to carry on its business in each jurisdiction in
which its business is now conducted, except where failure to obtain such
license, authorization, consent or approval could not reasonably be expected to
have a material adverse effect on (i) its ability to perform its obligations
under, or the enforceability of, any Transaction Document to which it is a
party, (ii) its business or financial condition, (iii) the interests of Buyer
under any Transaction Document or (iv) the enforceability or collectibility of
the Receivables (“Material Adverse Effect”).
 
(b)Authorization and No Contravention.  Its execution, delivery and performance
of each Transaction Document to which it is a party (i) are within its corporate
powers, (ii) have been duly authorized by all necessary corporate action,
(iii) do not contravene or constitute a default under:  (A) any applicable law,
rule or

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regulation binding an Originator or Buyer in any material respect, (B) its
charter or by-laws or (C) any agreement, order or other instrument to which it
is a party or its property is subject except to the extent such contravention or
default would not have a Material Adverse Effect and (iv) will not result in any
Adverse Claim on any Receivable or Collection or give cause for the acceleration
of any of its indebtedness.
 
(c)No Consent Required.  Other than the filing of financing statements and the
items set forth in the next sentence, no approval, authorization or other action
by, or filings with, any Governmental Authority or other Person is required
(other than any already given or obtained) in connection with the execution,
delivery and performance by it of any Transaction Document to which it is a
party or any transaction contemplated thereby.  The Transaction Documents and
the transactions contemplated thereby are subject to filing requirements or
reporting requirements, or both, under the Securities Exchange Act of 1934, as
amended, and Chapters 386 and 393 of the Missouri revised statutes, as amended,
and the rules and regulations promulgated thereunder.
 
(d)Binding Effect.  Each Transaction Document to which it is a party constitutes
the legal, valid and binding obligation of such Person enforceable against such
Person in accordance with its terms, except as limited by bankruptcy,
insolvency, or other similar laws of general application relating to or
affecting the enforcement of creditors’ rights generally and subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
 
Section 4.2. Additional Representations by Originator.  Originator further
represents and warrants to Buyer as follows:
 
(a)Perfection of Ownership Interest.  Immediately preceding its sale or
contribution of Receivables to Buyer, Originator was the owner of, and
effectively sold or contributed, such Receivables to Buyer, free and clear of
any Adverse Claim, except for the interests of the Secured Parties therein that
are created by the Second Tier Agreement.  Other than the ownership interest
granted to Buyer pursuant to this Agreement, Originator has not pledged,
assigned, sold or granted a security interest in, or otherwise conveyed, the
Receivables or the Collections, other than any such pledge, assignment or grant
that has been terminated in full prior to the sale or contribution
hereunder.  Originator has not authorized the filing of and is not aware of any
financing statements against Originator that include a description of collateral
covering the Receivables or the Collections other than any financing statement
relating to the security interest granted to Buyer hereunder or the Secured
Parties under the Second Tier Agreement or that has been terminated in full
prior to the sale or contribution hereunder.  Originator has caused or will have
caused, within ten days after the date hereof, the filing of all appropriate
financing statements in the proper filing office in the appropriate
jurisdictions under the applicable law in order to perfect the conveyance of
Receivables and Collections by Originator hereunder.
 
(b)Accuracy of Information.  All written information furnished by Originator in
connection with any Transaction Document, or any transaction contemplated
thereby,

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is true and accurate in all material respects as of the date it was dated (and,
when considered together with all current reports filed by Originator or Parent
with the SEC under the Securities Exchange Act of 1934, as amended, was not
incomplete by omitting to state a material fact necessary to make such
information not materially misleading in light of the circumstances when made).
 
(c)No Actions, Suits. Except as disclosed by Parent in its current reports filed
with the SEC under the Securities Exchange Act of 1934, as amended, there are no
actions, suits or other proceedings (including matters relating to environmental
liability) pending or threatened against or affecting Originator or any of its
properties, that (i) is reasonably likely to have a material adverse effect on
the financial condition of the Originator or on the collectibility of the
Receivables or (ii) seeks to challenge the validity of Originator’s obligations
under any Transaction Document to which it is a party or any transaction
contemplated thereby.  Originator is not in default of any contractual
obligation or in violation of any order, rule or regulation of any Governmental
Authority, which default or violation could reasonably be expected to have a
material adverse effect upon (i) the financial condition or the Originator or
(ii) the collectibility of the Receivables.
 
(d)No Material Adverse Change.  Since March 31, 2012 and except as disclosed by
Parent in its current reports filed with the SEC under the Securities Exchange
Act of 1934, as amended, there has been no material adverse change in (i) the
collectibility of the Receivables or (ii) the Originator’s financial condition,
business or results of operations or its ability to perform its obligations
under any Transaction Document.
 
(e)Accuracy of Exhibits. All information on Exhibits D and E of the Second Tier
Agreement (to the extent describing Originator) is true and complete, subject to
any changes permitted by, and notified to the Agent in accordance with the
Second Tier Agreement.
 
(f)Sales by Originator.  Each sale by Originator to Buyer of an interest in
Receivables has been made for “reasonably equivalent value” (as such term is
used in Section 548 of the Bankruptcy Code) and not for or on account of
“antecedent debt” (as such term is used in Section 547 of the Bankruptcy Code)
owed by Originator to Buyer.
 
(g)Use of Proceeds.  No proceeds of any purchase will be used (i) for the
purpose which violates, or would be inconsistent with, Regulation T, U or X
promulgated by the Board of Governors of the Federal Reserve System from  time
to time or (ii) to acquire any security in any transaction which is subject to
Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended.
 
(h)Lock-Box Accounts.  The names and address of all the Collection Banks and
addresses of the Lock-Boxes, are specified in Exhibit F.

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(i)Nature of Pool Receivables.  All Receivables originated by Originator
(i) were originated by Originator in the ordinary course of its business,
(ii) represent all, or a portion of the purchase price of goods, insurance or
services within the meaning of Section 3(c)(5)(A) of the Investment Company Act,
1940.
 
(j)Credit and Collection Policies.  Originator has complied with the Credit and
Collection Policies in all material respects, and such policies have not changed
in any material respect (except to the extent required by law, rule or
regulation) since the date hereof unless Agent has consented in writing to such
change.
 
(k)Eligible Receivables.  Each Receivable shall be an Eligible Receivable on the
date of any purchase or contribution hereunder, unless otherwise specified in
the first Periodic Report that includes such Receivable.
 
 
Section 5.  General Covenants.

 
Section 5.1. Covenants.  Originator hereby covenants and agrees to comply with
the following covenants and agreements, unless Buyer (with the consent of the
Agent) shall otherwise consent:
 
(a)Financial Reporting. Originator shall, and shall cause the Parent, to
maintain a system of accounting established and administered in accordance with
GAAP and shall furnish to Buyer:
 
(i)Within 90 days after each fiscal year of the Parent, (a) copies of the
Parent’s annual audited financial statements (including a consolidated balance
sheet, consolidated statement of income and retained earnings and statement of
cash flows, with related footnotes) certified by an independent registered
public accounting firm which is generally recognized as being among the “big
four” and prepared on a consolidated basis in conformity with GAAP, and (b) an
unaudited consolidating balance sheet for the Parent and its consolidated
Subsidiaries as of the end of such period and related consolidating income
statements, certified by a  Designated Financial Officer of the Parent;
 
(ii)Within 45 days after the close of the first three (3) quarterly periods of
each of the Parent’s fiscal years, (a) for the Parent and its consolidated
Subsidiaries, either (I) consolidated unaudited balance sheets as at the close
of each such period and consolidated and consolidating profit and loss and
reconciliation of surplus statements and a statement of cash flows for the
period from the beginning of such fiscal year to the end of such quarter, all
certified by a Designated Financial Officer of the Parent or (II) if the Parent
is then a “registrant” within the meaning of Rule 1-01 of Regulation S-X of the
SEC and required to report on Form 10-Q with the SEC, a copy of the Parent’s
report on Form 10-Q for such quarterly period and (b) either (I) consolidating
unaudited balance sheets and related consolidating income statements for the
Parent and its consolidated Subsidiaries as at the close of each such period,
all certified by a

 
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Designated Financial Officer of the Parent or (II) if the Parent is then a
“registrant” within the meaning of Rule 1-01 of Regulation S-X of the SEC and
required to report on Form 10-Q with the SEC, a copy of the Parent’s report on
Form 10-Q for such quarterly period;
 
(iii)Promptly upon becoming available, a copy of each report or proxy statement
filed by the Parent with the Securities and Exchange Commission or any
securities exchange;
 
(iv)Promptly after the filing or receiving thereof, copies of all reports and
notices with respect to any “Reportable Event” defined in Article IV of ERISA
that could reasonably be expected to result in a liability in an aggregate
amount in excess of $50,000,000 which Parent files under ERISA with the Internal
Revenue Service, the Pension Benefit Guaranty Corporation or the U.S. Department
of Labor or which Parent receives from the Pension Benefit Guaranty Corporation;
 
(v)[Reserved];
 
(vi)[Reserved]; and
 
(vii)With reasonable promptness such other information (including non-financial
information) as Buyer may reasonably request.
 
The statements and reports of the Parent required to be furnished pursuant to
clauses (i), (ii) and (iii) above shall be deemed furnished for such purpose
upon becoming publicly available on the Securities and Exchange Commission’s
EDGAR web page.
 
(b)Notices.  Promptly and in any event within five Business Days after a
Designated Financial Officer of Originator obtains knowledge of any of the
following, Originator will notify Buyer and the Agent and provide a description
of:
 
(i)Potential Termination Events.  The occurrence of any Potential Termination
Event;
 
(ii)Representations and Warranties.  The failure of any representations or
warranty herein to be true when made in any material respect; or
 
(iii)Litigation.  The institution of any litigation, arbitration proceeding or
governmental proceeding reasonably likely to be material to the collectibility
or quality of the Receivables which is not referenced in the Parent’s filings
with the SEC.
 
(c)Conduct of Business.  The Originator will perform all actions necessary to
remain duly incorporated, validly existing and in good standing in its
jurisdiction of

 
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incorporation and to maintain all requisite authority to conduct its business in
each jurisdiction in which it conducts business except where the failure to do
so could not reasonably be expected to have a material adverse effect on the
collectibility of the Receivables.  
 
(d)Compliance with Laws.  The Originator will comply with all laws, regulations,
judgments and other directions or orders imposed by any Governmental Authority
to which the Originator or any Receivable, any Related Security or Collection
may be subject, except where the failure to do so could not reasonably be
expected to have a material adverse effect on the collectibility of the
Receivables.
 
(e)Furnishing Information and Inspection of Records.  Originator will furnish to
Buyer and the Agent (as assignee of the Buyer) such information concerning the
Receivables as Buyer may reasonably request.  With reasonable notice, Originator
will permit, at any time during regular business hours, Buyer or the Agent (as
assignee of the Buyer) (or), in each case, any representatives thereof) (i) to
examine and make copies of all Records, (ii) to visit the offices and properties
of Originator for the purpose of examining the Records and (iii) to discuss
matters relating hereto with any of Originator’s officers, directors, employees
or independent public accountants having knowledge of such matters.  
 
(f)Keeping Records.  (i) Originator will have and maintain (A) administrative
and operating procedures (including an ability to recreate Records if originals
are destroyed), (B) adequate facilities, personnel and equipment (which may be
arranged through joint operating, service or similar agreements with affiliates)
and (C) all Records and other information necessary or advisable for collecting
the Receivables (including Records adequate to permit the immediate
identification of each new Receivable and all Collections of, and adjustments
to, each existing Receivable).  Originator will give Buyer prior notice of any
material change in such administrative operating procedures.
 
(ii)Originator will at all times from and after the date hereof, clearly and
conspicuously mark its computer and master data processing books and records
with a legend describing Buyer’s ownership of, and in the alternative, security
interest in the Receivables and the Collections.
 
(g)Perfection.  (i) The Originator will at its expense, promptly execute and
deliver all instruments and documents and take all action necessary or
reasonably requested by the Buyer (including the execution and filing of
financing or continuation statements, amendments thereto or assignments thereof)
to vest and maintain vested in the Buyer a valid, first priority perfected
security interest in the Receivables, the Collections, the Lock-Boxes, the
Collection Account and proceeds thereof free and clear of any Adverse Claim (and
a perfected ownership interest in the Receivables and Collections to the extent
of the Purchase Interest).  To the extent permitted by applicable law, the Buyer
will be permitted to sign and file any continuation statements, amendments
thereto and assignments thereof without the Originator’s signature.

 
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(ii)The Originator will not change its name, identity or corporate structure or
relocate its jurisdiction of organization or chief executive office or the
Records except after fifteen (15) days advance notice to the Buyer and the Agent
and the delivery to the Buyer and the Agent of all financing statements,
instruments and other documents (including direction letters) requested by the
Buyer and the Agent.
 
(iii)The Originator will at all times maintain its chief executive offices and
maintain its jurisdiction of organization within a jurisdiction in the USA in
which Article 9 of the UCC is in effect.  If the Originator moves its chief
executive office to a location that imposes Taxes, fees or other charges to
perfect the Buyer’s interests hereunder, the Originator will pay all such
amounts and any other costs and expenses incurred in order to maintain the
enforceability of the Transaction Documents, the Purchase Interest and the
interests of the Buyer in the Receivables, the Related Security, the Lock-Boxes,
the Collection Account and Collections.
 
(h)Payments on Receivables, Accounts.  The Originator will at all times instruct
all Obligors to deliver payments on the Receivables to a Lock-Box, the
Collection Account or to a Designated Payee.  The Originator will also instruct
each Designated Payee to pay all Collections it receives to a Collection
Account.  If any such payments or other Collections are received by the
Originator, it shall hold such payments in trust for the benefit of the Buyer
and promptly (but in any event within two Business Days after receipt) remit
such funds at the direction of the Buyer.  The Originator will cause each
Collection Bank to comply with the terms of each applicable Deposit Account
Control Agreement.  After the occurrence of a Termination Event, the Originator
will not, and will not permit any Collection Agent or other Person to, commingle
Collections or other funds to which the Buyer is entitled with any other
funds.  The Originator shall only add a Collection Bank or Lock-Box to those
listed on Exhibit F of the Second Tier Agreement if the Buyer has received
notice of such addition, a copy of any new Lock-Box Agreement, as applicable,
and an executed and acknowledged copy of a Deposit Account Control Agreement
(with such changes as are acceptable to the Buyer) from any new Collection
Bank.  The Originator shall only terminate a Collection Bank or Lock-Box upon 30
days advance notice to the Buyer.  If the long term unsecured indebtedness of
the Originator is rated less than BBB- by S&P and Baa3 by Moody’s (or either S&P
or Moody’s if the other has withdrawn or suspended such rating), the Originator
agrees that the Agent may, in its sole discretion, deliver the Agent’s Notice to
the Collection Bank.
 
(i)Sales and Adverse Claims Relating to Receivables.  Except as otherwise
provided herein, the Originator will not (by operation of law or otherwise)
dispose of or otherwise transfer, or create or suffer to exist any Adverse Claim
upon, any Receivable or any proceeds thereof.
 
(j)Extension or Amendment of Receivables.  Except as otherwise permitted in the
Second Tier Agreement and then subject to Section 1.5 of the Second Tier
Agreement, the Originator will not extend, amend, rescind or cancel any
Receivable.

 
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(k)Performance of Duties.  Originator will perform its duties or obligations in
accordance with the provisions of each of the Transaction Documents to which it
is a party.  Originator (at its expense) will (i) fully and timely perform in
all material respects all agreements, if any, required to be observed by it in
connection with each Receivable, (ii) comply in all material respects with the
Credit and Collection Policy, and (iii) refrain from any action that could
reasonably be expected to impair the rights of Buyer in the Receivables or
Collections.
 
(l)Agreed Upon Procedures Report.  Originator shall cooperate with the
Collection Agent and the designated accountants for each annual agreed upon
procedures report required pursuant to Section 5.1(a)(vi) of the Second Tier
Agreement.
 
(m)Changes to Credit and Collection Policy and Character of Business.  The
Originator shall not, except as required by law rule or regulation make any
material change to the Credit and Collection Policy without the prior written
consent of the Buyer and the Agent.
 
(n)Total Indebtedness to Total Capitalization.  Originator shall at all times
cause the ratio of (i) Total Indebtedness to (ii) Total Capitalization (in each
case measured as of the  most  recent fiscal quarter end) to be less than or
equal to 0.65 to 1.0.
 
Section 5.2. Organizational Separateness.  Originator agrees not to take any
action that would cause Buyer to violate its certificate of incorporation,
by-laws or the covenants in Section 5.1(o) of the Second Tier Agreement.  Buyer
agrees to conduct its business in a manner consistent with its certificate of
incorporation and by-laws.
 
 
Section 6.  Termination of Contributions and Purchases.

 
Section 6.1. Voluntary Termination.  The contribution, purchase and sale of
Receivables pursuant to this Agreement may be terminated by either party, upon
at least five Business Days' prior written notice to the other party.
 
Section 6.2. Automatic Termination.  The contribution, purchase and sale of
Receivables pursuant to this Agreement shall automatically terminate upon the
occurrence of (i) a Bankruptcy Event with respect to Originator, or (ii) the
Termination Date.
 
 
Section 7.  Indemnification.

 
Section 7.1. Originator’s Indemnity.  Without limiting any other rights any
Person may have hereunder or under applicable law, Originator hereby indemnifies
and holds harmless Buyer and its officers, managers, agents and employees (each
an “Indemnified Party”) from and against any and all damages, losses, claims,
liabilities, penalties, Taxes, costs and expenses (including reasonable
attorneys’ fees and court costs actually incurred) (all of the foregoing
collectively, the “Indemnified Losses”) at any time imposed on or incurred by
any Indemnified Party arising out of or otherwise relating to any Transaction
Document, the transactions contemplated thereby, or any action taken or omitted
by any of the Indemnified Parties, whether

 
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arising by reason of the acts to be performed by Originator hereunder or
otherwise, excluding only Indemnified Losses (“Excluded Losses”) to the extent
(a) a final judgment of a court of competent jurisdiction holds such Indemnified
Losses resulted solely from gross negligence or willful misconduct of the
Indemnified Party seeking indemnification, (b) solely due to the credit risk of
the Obligor or the refusal or financial inability of the Obligor to pay
undisputed indebtedness or for which reimbursement would constitute recourse to
Originator or the Collection Agent for uncollectible Receivables or (c) such
Indemnified Losses include Taxes on, or measured by, the overall net income of
the Buyer or its assigns.  Without limiting the foregoing indemnification,
Originator shall indemnify each Indemnified Party for Indemnified Losses (other
than Excluded Losses) relating to or resulting from:
 
(i)any representation or warranty made by or on behalf of Originator under or in
connection with this Agreement, any Periodic Report or any other information or
report delivered by Originator pursuant to the Transaction Documents, which
shall have been false or incorrect in any material respect when made or deemed
made;
 
(ii)the failure by Originator to comply with any applicable law, rule or
regulation related to any Receivable, or the nonconformity of any Receivable
with any such applicable law, rule or regulation;
 
(iii)the failure of Originator to vest and maintain vested in Buyer, a perfected
ownership or security interest in the Receivables and the other property
conveyed pursuant hereto, free and clear of any Adverse Claim;
 
(iv)any commingling of Collections with any other funds;
 
(v)any failure of a Collection Bank to comply with the terms of the applicable
Lock-Box Agreement;
 
(vi)any dispute, claim, offset or defense (other than Excluded Losses) of the
Obligor to the payment of any Receivable, or any other claim resulting from the
rendering of services related to such Receivable or the furnishing or failure to
furnish any such services or other similar claim or defense not arising from
Excluded Losses;
 
(vii)any failure of Originator to perform its duties or obligations in
accordance with the provisions of this Agreement or any other Transaction
Document to which Originator is a party;
 
(viii)any environmental liability claim, products liability claim or personal
injury or property damage suit or other similar or related claim or action of
whatever sort, arising out of or in connection with any Receivable or any other
suit, claim or action of whatever sort relating to any of Originator’s
obligations under the Transaction Documents;
 
(ix)any tax or governmental fee or charge (but not including taxes upon or
measured by net income or otherwise contemplated by the Intended Tax

 
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Characterization), all interest and penalties thereon or with respect thereto,
and all out-of-pocket costs and expenses, including the fees and expenses of
counsel in defending against the same, which may rise by reason of the purchase
or ownership of any Receivable or Related Security or in any goods which secure
any Receivable or Related Security;
 
(x)the failure to comply with provisions of the Transaction Documents requiring
notifications to any Obligor of the assignment pursuant to the terms hereof of
any Receivable to Buyer (and subsequently, pursuant to the Second Tier
Agreement, to Agent for the benefit of Buyer) or to comply with provisions of
the Transaction Documents requiring notifications to require that payments
(including any under the related insurance policies) be made directly to Buyer
pursuant to the terms hereof (and subsequently, pursuant to the Second Tier
Agreement, to Agent for benefit of Buyer);
 
(xi)any Taxes (other than as contemplated by the Intended Tax Characterization)
imposed upon any Indemnified Party or upon or with respect to the Receivables,
all interest and penalties thereon or with respect thereto, and all
out-of-pocket costs and expenses related thereto or arising therefrom, including
the reasonable fees and expenses of counsel in defending against the same, which
may arise by reason of the purchase or ownership or sale of any Receivables (or
of any interest therein) or Related Security or in any goods which secured any
such Receivables or Related Security;
 
(xii)any loss arising, directly or indirectly, as a result of the imposition of
sales or analogous taxes imposed on or collected as part of the Receivables or
the failure by the Originator to timely collect and remit to the appropriate
authority any such taxes; or
 
(xiii)any action taken by the Originator or any other Affiliate of the
Originator related to any Receivable and the Related Security, or arising out of
any alleged failure of compliance of any Receivable or the Related Security with
the provisions of any law or regulation.
 
If for any reason the indemnification provided above in this Section is
unavailable to an Indemnified Party or is insufficient to hold an Indemnified
Party harmless, then Originator shall contribute to the amount paid or payable
by such Indemnified Party as a result of such loss, claim, damage or liability
in such proportion as is appropriate to reflect not only the relative benefits
received by such Indemnified Party on the one hand and Originator on the other
hand but also the relative fault of such Indemnified Party as well as any other
relevant equitable considerations; provided, however, that notwithstanding any
other provision hereof to the contrary, Originator shall not have any
obligations concerning Excluded Losses.
 
Section 7.2. Indemnification Due to Failure to Consummate Purchase.  Originator
will indemnify Buyer on demand and hold it harmless  against all costs
(including, without limitation, breakage costs) and expenses incurred by Buyer
resulting from any failure by Originator to

 
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consummate a purchase or contribution after Buyer has requested a transfer of
the applicable Receivables to the Buyer under the terms of the Second Tier
Agreement.
 
Section 7.3. Other Costs.  If Buyer becomes obligated to compensate the
Purchaser under the Second Tier Agreement or any other Transaction Document for
any costs or indemnities pursuant to any provision of the Second Tier Agreement
or any other Transaction Document, which obligation is caused by Originator’s
failure to perform any obligations hereunder, then Originator shall, on demand,
reimburse Buyer for the amount of any compensation.
 
 
Section 8.  Miscellaneous.

 
Section 8.1. Amendments, Waivers, etc.  No amendment of this Agreement or waiver
of any provision hereof or consent to any departure by either party therefrom
shall be effective without the written consent of the party that is sought to be
bound.  Any such waiver or consent shall be effective only in the specific
instance given.  No failure or delay on the part of either party to exercise,
and no delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.  The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.  Originator agrees that the Buyer and the Agent may
rely upon the terms of this Agreement, and that the terms of this Agreement may
not be amended, nor any material waiver of those terms be granted, without the
consent of the Agent; provided that Originator and Buyer may agree to an
adjustment of the purchase price for any Receivable without the consent of the
Agent provided that any such adjustment shall be prospective only and the
purchase price paid for any Receivable shall be an amount not less than adequate
consideration that represents fair value for such Receivable.  BTMNY,
individually and as Agent, Liquidity Provider and Enhancement Provider is hereby
authorized by the parties hereto, at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by BTMNY to or for the credit to the
account of Originator, against any obligations of the Originator now or
hereafter existing under this Agreement that have been assigned to and are
payable to or for the benefit of BTMNY as Agent, Liquidity Provider or
Enhancement Provider pursuant to Section 1.8(a) of the Second Tier Agreement.
 
Section 8.2. Assignment of Purchase and Sale Agreement. Originator hereby
acknowledges that on the date hereof Buyer has assigned all of its right, title
and interest in, to and under this Agreement to the Agent for the benefit of the
Buyer pursuant to the Second Tier Agreement and that the Agent and the Buyer are
express third party beneficiaries hereof.  Originator hereby further
acknowledges that after the occurrence of the Termination Date all provisions of
this Agreement shall inure to the benefit of the Agent and the Buyer, including
the enforcement of any provision hereof to the extent set forth in the Second
Tier Agreement, but that neither the Agent nor the Buyer shall have any
obligations or duties under this Agreement.  Originator hereby further
acknowledges that the execution and performance of this Agreement are conditions
precedent for the Agent and the Buyer to enter into the Second Tier Agreement
and that the agreement of the Agent and Buyer to enter into the Second Tier
Agreements will

 
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directly or indirectly benefit Originator and constitutes good and valuable
consideration for the rights and remedies of the Agent and the Buyer with
respect hereto.
 
Section 8.3.  Binding Effect.  This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
and shall also, to the extent provided herein, inure to the benefit of the
parties to the Second Tier Agreement.
 
Section 8.4. Survival.  The rights and remedies with respect to any breach of
any representation and warranty made by Originator or Buyer pursuant to Section
4 and the indemnification provisions of Section 7 shall survive any termination
of this Agreement.
 
Section 8.5. Costs, Expenses and Taxes.  In addition to the obligations of
Originator under Section 7, each party hereto agrees to pay within 30 days of
demand all costs and expenses incurred by the other party and its assigns (other
than Excluded Losses) in connection with the enforcement of, or any actual or
claimed breach of, this Agreement, including the reasonable fees and expenses of
counsel to any of such Persons incurred in connection with any of the foregoing
or in advising such Persons as to their respective rights and remedies under
this Agreement in connection with any of the foregoing. Originator also agrees
to pay on demand all stamp and other taxes and fees payable or determined to be
payable in connection with the execution, delivery, filing, and recording of
this Agreement.
 
Section 8.6. Execution in Counterparts; Integration.  This Agreement may be
executed in any number of counterparts and by the different parties in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute one and the same
Agreement.
 
Section 8.7. Governing Law; Submission to Jurisdiction.  This Agreement shall be
governed by, and construed in accordance with, the internal laws of the State of
New York (including Section 5-1401-1 of the General Obligations Law, but without
regard to any other conflict of laws provisions thereof).
 
Section 8.8. No Proceedings.  Originator agrees, for the benefit of the parties
to the Second Tier Agreement, that it will not institute against Buyer, or join
any other Person in instituting against Buyer, any proceeding of a type referred
to in the definition of Bankruptcy Event until one year and one day after no
investment, loan or commitment is outstanding under the Second Tier Agreement.
In addition, all amounts payable by Buyer to Originator pursuant to this
Agreement shall be payable solely from funds available for that purpose (after
Buyer has satisfied all obligations then due and owing under the Second Tier
Agreement).
 
Section 8.9.  Loans by Buyer to Originator.  Buyer may make loans to Originator
from time to time if so agreed between such parties and to the extent that Buyer
has funds available for that purpose after satisfying its obligations under this
Agreement and the Second Tier Agreement.  Any such loan shall be payable upon
demand (and may be prepaid without penalty or premium) and shall bear interest
at such rate as Buyer and Originator shall from time to time agree.

 
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  Section 8.10. Notices.  Unless otherwise specified, all notices and other
communications hereunder shall be in writing (including by telecopier or other
facsimile communication), given to the appropriate Person at its address or
telecopy number set forth in the Second Tier Agreement or at such other address
or telecopy number as such Person may specify, and effective when received at
the address specified by such Person.
 
Section 8.11. Entire Agreement.  This Agreement constitutes the entire
understanding of the parties thereto concerning the subject matter thereof.  Any
previous or contemporaneous agreements, whether written or oral, concerning such
matters are superseded thereby.
 
Section 8.12. Confidentiality.  Each party hereto agrees to comply with the
confidentiality provisions of Section 9.10 of the Second Tier Agreement.
 
Section 8.13. Waiver of Trial by Jury.  To the extent permitted by applicable
law, each party hereto irrevocably waives all right of trial by jury in any
action, proceeding or counterclaim arising out of, or in connection with, any
transaction document or any matter arising thereunder.

 
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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.

 
KCP&L Greater Missouri Operations Company, as Originator
 
By /s/ Kevin E. Bryant
 
  Name: Kevin E. Bryant
 
  Title: Vice President-Investor Relations and Treasurer
 
 
GMO Receivables Company, as Buyer
 
By /s/ James P. Gilligan
 
  Name: James P. Gilligan
 
  Title: President

 

 
 
 

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Exhibit A
 
Purchase Price
 
All capitalized terms used, and not otherwise defined, herein have the meanings
set forth for such terms in the Receivables Sale Agreement dated as of May 31,
2012 among GMO Receivables Company (“Seller”), as the Seller, KCP&L Greater
Missouri Operations Company (“KCPL”), as the Initial Collection Agent, The Bank
of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as the Agent, and Victory
Receivables Corporation or, if not defined therein, in the Purchase and Sale
Agreement dated as of May 31, 2012 between KCPL Greater Missouri Operations
Company, as the Originator (“Originator”), and Seller, as the Buyer (“Buyer”).
 
The purchase price applicable to the Receivables purchased on any day after the
Initial Funding Date by Buyer from Originator shall be equal to 98.75% times the
aggregate outstanding balance of such Receivables.  The foregoing purchase
price, which is fair market value for such Receivables, was calculated to yield
to the Buyer a reasonable profit return on its equity and was calculated
assuming, among other things, that charge-offs of Receivables in any year will
average approximately one-half of one percent (0.5%) of the average outstanding
balance of the Receivables and that LIBOR (which represents the index for the
Buyer’s cost of funds) would average approximately 0.5%.  If the Originator or
Buyer determines that charge-offs in any twelve-month period have exceeded one
percent (1.0%) of the average outstanding balance of Receivables during such
period, or if LIBOR subsequently rises above 1.0%, then the Originator and the
Buyer agree to negotiate in good faith to re-set the purchase price percentage
so as to reflect in an equitable manner the impact of such revised charge-off
ratio or revised cost of funds on the Buyer’s anticipated equity return.  Any
such change in the purchase price percentage shall not take effect unless and
until both parties agree to such adjustment.  In the event that (i) the purchase
price is adjusted due to increased charge-offs and average charge-off experience
over a twelve-month period subsequently reduces to one-half of one percent, or
(ii) the purchase price is adjusted due to an increase in LIBOR and LIBOR
subsequently reduces below 1.0% for a three-month consecutive period then the
Originator and Buyer may subsequently agree to readjust the purchase price
percentage as set forth above to reflect the equitable impact of such
changes.  All purchase price adjustments pursuant to the foregoing provisions
shall be prospective only and shall not operate to adjust retroactively the
purchase price previously paid for any Receivables.

 

 
 

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