RECEIVABLES SALE AGREEMENT

DATED AS OF DECEMBER 12, 2001

AMONG

ADC TELECOMMUNICATIONS SALES, INC.,
AS ORIGINATOR,

ADC TELECOMMUNICATIONS, INC.,
AS ORIGINATOR AGENT,

AND

ADC RECEIVABLES CORP. I,
AS BUYER


ARTICLE I AMOUNTS AND TERMS OF THE PURCHASE  1
 
Section 1.1

 

Initial Contribution of Receivables

 

1
 
Section 1.2

 

Purchase of Receivables

 

1
 
Section 1.3

 

Payment for the Purchase

 

2
 
Section 1.4

 

Purchase Price Credit Adjustments

 

4
 
Section 1.5

 

Payments and Computations, Etc.

 

4
 
Section 1.6

 

Transfer of Records

 

4
 
Section 1.7

 

Characterization

 

5
 
Section 1.8

 

Allocation of Purchase Price and Indemnification

 

5

ARTICLE II REPRESENTATIONS AND WARRANTIES

 

6
 
Section 2.1

 

Representations and Warranties of Originator

 

6

ARTICLE III CONDITIONS OF PURCHASE

 

9
 
Section 3.1

 

Conditions Precedent to Purchase

 

9
 
Section 3.2

 

Conditions Precedent to Subsequent Payments

 

9

ARTICLE IV COVENANTS

 

10
 
Section 4.1

 

Affirmative Covenants

 

10
 
Section 4.2

 

Negative Covenants of Originator.

 

13

ARTICLE V TERMINATION EVENTS

 

14
 
Section 5.1

 

Termination Events.

 

14
 
Section 5.2

 

Remedies.

 

15

ARTICLE VI INDEMNIFICATION

 

16
 
Section 6.1

 

Indemnities by Originator

 

16
 
Section 6.2

 

Other Costs and Expenses

 

17
 
Section 6.3

 

Control of Defense

 

18

ARTICLE VII MISCELLANEOUS

 

18
 
Section 7.1

 

Waivers and Amendments.

 

18
 
Section 7.2

 

Notices

 

18
 
Section 7.3

 

Protection of Ownership Interests of Buyer.

 

18
 
Section 7.4

 

Confidentiality.

 

19
 
Section 7.5

 

Bankruptcy Petition.

 

20
 
Section 7.6

 

Limitation of Liability

 

20
 
Section 7.7

 

CHOICE OF LAW

 

20
 
Section 7.8

 

CONSENT TO JURISDICTION

 

20
 
Section 7.9

 

WAIVER OF JURY TRIAL

 

21
 
Section 7.10

 

Integration; Binding Effect; Survival of Terms

 

21
 
Section 7.11

 

Counterparts; Severability; Section References

 

21

i


EXHIBITS AND SCHEDULES

Exhibit I  Definitions

Exhibit II

 


 

Principal Place(s) of Business; Location(s) of Records; Federal Employer Identification Number; Organizational Number; Other Names

Exhibit III

 


 

Lock-Boxes; Collection Accounts; Collection Banks

Exhibit IV

 


 

Form of Compliance Certificate

Exhibit V

 


 

Copy of Credit and Collection Policy

Exhibit VI

 


 

Form of Subordinated Note

Exhibit VII

 


 

Form of Purchase Report

Schedule A

 


 

List of Documents to Be Delivered to Buyer Prior to the Purchase

ii



RECEIVABLES SALE AGREEMENT

         THIS RECEIVABLES SALE AGREEMENT, dated as of December 12, 2001, is by and among ADC Telecommunications Sales, Inc., a Minnesota corporation ( "Originator" ), ADC Telecommunications, Inc., a Minnesota corporation ( "ADC Telecom" ), in its capacity as agent for Originator (in such capacity, the "Originator Agent" ), and ADC Receivables Corp. I, a Minnesota corporation ( "Buyer" ). Unless defined elsewhere herein, capitalized terms used in this Agreement shall have the meanings assigned to such terms in Exhibit I hereto (or, if not defined in Exhibit I hereto, the meaning assigned to such term in Exhibit I to the Purchase Agreement).


PRELIMINARY STATEMENTS

NOW, THEREFORE, in consideration of the foregoing premises and the mutual agreements herein contained and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:


ARTICLE I
AMOUNTS AND TERMS OF THE PURCHASE

        Section 1.1    Initial Contribution of Receivables.    On the date specified in that certain First Amendment to Receivables Sale Agreement (the "First Amendment" ) to be entered into by the parties hereto in form and substance satisfactory to each party hereto (the "Initial Sale Date"), Originator does hereby contribute, assign, transfer, set-over and otherwise convey to Buyer, and Buyer does hereby accept from Originator, Receivables originated by Originator and existing as of the close of business on the Business Day immediately prior to the Initial Sale Date (the "Initial Cutoff Date" ) having an aggregate Outstanding Balance of an amount specified in the First Amendment (the "Initial Contributed Receivables" ), together with all Related Security relating thereto and all Collections thereof.

        Section 1.2    Purchase of Receivables.    

1


        Section 1.3    Payment for the Purchase.    

2


The Purchase Price for each Receivable coming into existence after the Initial Cutoff Date shall be due and owing in full by Buyer to Originator Agent, for the benefit of Originator on the date each such Receivable came into existence (except that Buyer may, with respect to any such Purchase Price, offset against such Purchase Price any amounts owed by or on behalf of Originator to Buyer hereunder and which have become due but remain unpaid) and shall be paid to Originator Agent, for the benefit of Originator in the manner provided in the following paragraphs (b), (c) and (d).

Subject to the limitations set forth in Section 1.3(a)(ii) , Originator Agent, on behalf of Originator, irrevocably agrees to advance each Subordinated Loan requested by Buyer on or prior to the Termination Date. The Subordinated Loans shall be evidenced by, and shall be payable in accordance with the terms and provisions of the Subordinated Note and shall be payable solely from funds which Buyer is not required under the Purchase Agreement to set aside for the benefit of, or otherwise pay over to, the Purchasers.

3


        Section 1.4    Purchase Price Credit Adjustments.    If on any day:

then, in such event, Buyer shall be entitled to a credit (each, a "Purchase Price Credit" ) against the Purchase Price otherwise payable hereunder equal to the Outstanding Balance of such Receivable (calculated before giving effect to the applicable reduction or cancellation). If such Purchase Price Credit exceeds the Original Balance of the Receivables coming into existence on any day, then Originator Agent, for the benefit of Originator shall pay the remaining amount of such Purchase Price Credit in cash immediately, provided that if the Termination Date has not occurred, Originator Agent, for the benefit of Originator, shall be allowed to deduct the remaining amount of such Purchase Price Credit from any indebtedness owed to Originator Agent under the Subordinated Note.

        Section 1.5    Payments and Computations, Etc.    All amounts to be paid or deposited by Buyer hereunder shall be paid or deposited in accordance with the terms hereof on the day when due in immediately available funds to the account of Originator Agent, for the benefit of Originator, designated from time to time by Originator Agent or as otherwise directed by Originator. In the event that any payment owed by any Person hereunder becomes due on a day that is not a Business Day, then such payment shall be made on the next succeeding Business Day. If any Person fails to pay any amount hereunder when due, such Person agrees to pay, on demand, the Default Fee in respect thereof until paid in full; provided, however, that such Default Fee shall not at any time exceed the maximum rate permitted by applicable law. All computations of interest payable hereunder shall be made on the basis of a year of 360 days for the actual number of days (including the first but excluding the last day) elapsed.

        Section 1.6    Transfer of Records.    

4


        Section 1.7    Characterization.    If, notwithstanding the intention of the parties expressed in Section 1.2(c) , any sale or contribution by Originator to Buyer of Receivables hereunder shall be characterized as a secured loan and not a sale or such sale shall for any reason be ineffective or unenforceable, then this Agreement shall be deemed to constitute a security agreement under the UCC and other applicable law. For this purpose and without being in derogation of the parties' intention that the sale of Receivables hereunder shall constitute a true sale thereof, Originator hereby grants to Buyer a duly perfected security interest in all of Originator's right, title and interest in, to and under all Receivables now existing and hereafter arising, all Collections and Related Security with respect thereto, each Lock-Box and Collection Account, all other rights and payments relating to the Receivables and all proceeds of the foregoing to secure the prompt and complete payment of a loan deemed to have been made in an amount equal to the Purchase Price of the Receivables together with all other obligations of Originator hereunder, which security interest shall be prior to all other Adverse Claims thereto. Buyer and its assigns shall have, in addition to the rights and remedies which they may have under this Agreement, all other rights and remedies provided to a secured creditor under the UCC and other applicable law, which rights and remedies shall be cumulative.

        Section 1.8    Allocation of Purchase Price and Indemnification.    

5



ARTICLE II
REPRESENTATIONS AND WARRANTIES

        Section 2.1    Representations and Warranties of Originator.    Originator hereby represents and warrants to Buyer on the date hereof, on the date of the Purchase and on each date that any Receivable comes into existence that:

6


7


8



ARTICLE III
CONDITIONS OF PURCHASE

        Section 3.1    Conditions Precedent to Purchase.    The Purchase under this Agreement is subject to the conditions precedent that (a) Buyer shall have been capitalized with the Initial Contributed Receivables, (b) Buyer shall have received on or before the date of such purchase those documents listed on Schedule A and (c) all of the conditions to the initial purchase under the Purchase Agreement shall have been satisfied or waived in accordance with the terms thereof; provided that the execution of this Agreement by the parties hereto shall not be deemed a waiver of any of the conditions precedent to the Purchase under this Agreement in any way.

        Section 3.2    Conditions Precedent to Subsequent Payments.    Buyer's obligation to pay for Receivables coming into existence after the Initial Cutoff Date shall be subject to the further conditions precedent that: (a) the Facility Termination Date shall not have occurred under the Purchase Agreement; (b) Buyer (or its assigns) shall have received such other approvals, opinions or documents as it may reasonably request and (c) on the date such Receivable came into existence, the following statements shall be true (and acceptance of the proceeds of any payment for such Receivable shall be deemed a representation and warranty by Originator that such statements are then true):

Notwithstanding the foregoing conditions precedent, upon payment of the Purchase Price for any Receivable (whether by payment of cash, through an increase in the amounts outstanding under the Subordinated Note, by offset of amounts owed to Buyer and/or by offset of capital contributions), title to such Receivable and the Related Security and Collections with respect thereto shall vest in Buyer,

9


whether or not the conditions precedent to Buyer's obligation to pay for such Receivable were in fact satisfied. The failure of Originator to satisfy any of the foregoing conditions precedent, however, shall give rise to a right of Buyer to rescind the related purchase and direct Originator to pay to Buyer an amount equal to the Purchase Price payment that shall have been made with respect to any Receivables related thereto.


ARTICLE IV
COVENANTS

        Section 4.1    Affirmative Covenants.    Until the date on which this Agreement terminates in accordance with its terms, Originator and Originator Agent hereby covenants as set forth below:

10


11


12


        Section 4.2    Negative Covenants of Originator.    Until the date on which this Agreement terminates in accordance with its terms, Originator hereby covenants that:

13



ARTICLE V
TERMINATION EVENTS

        Section 5.1    Termination Events.    The occurrence of any one or more of the following events shall constitute a Termination Event:

14


        Section 5.2    Remedies.    Upon the occurrence and during the continuation of a Termination Event, Buyer may take any of the following actions: (i) declare the Termination Date to have occurred, whereupon the Termination Date shall forthwith occur, without demand, protest or further notice of any kind, all of which are hereby expressly waived by Originator; provided, however, that upon the occurrence of a Termination Event described in Section 5.1(d) , or of an actual or deemed entry of an order for relief with respect to Originator under the Federal Bankruptcy Code, the Termination Date shall automatically occur, without demand, protest or any notice of any kind, all of which are hereby expressly waived by Originator and (ii) to the fullest extent permitted by applicable law, declare that the Default Fee shall accrue with respect to any amounts then due and owing by Originator to Buyer. The aforementioned rights and remedies shall be without limitation and shall be in addition to all other rights and remedies of Buyer and its assigns otherwise available under any other provision of this Agreement, by operation of law, at equity or otherwise, all of which are hereby expressly preserved, including, without limitation, all rights and remedies provided under the UCC, all of which rights shall be cumulative.

15



ARTICLE VI
INDEMNIFICATION

        Section 6.1    Indemnities by Originator.    Without limiting any other rights that Buyer may have hereunder or under applicable law, Originator hereby agrees to indemnify (and pay upon demand to) Buyer and its assigns, officers, directors, agents and employees (each an "Indemnified Party" ) from and against any and all damages, losses, claims, taxes, liabilities, costs, expenses and for all other amounts payable, including reasonable attorneys' fees (which attorneys may not be employees of Buyer or any such assign) and disbursements (all of the foregoing being collectively referred to as "Indemnified Amounts" ) awarded against or incurred by any of them arising out of or as a result of this Agreement or the acquisition, either directly or indirectly, by Buyer of an interest in the Receivables, excluding, however:

provided, however, that nothing contained in this sentence shall limit the liability of Originator or limit the recourse of Buyer to Originator for amounts otherwise specifically provided to be paid by Originator under the terms of this Agreement. Without limiting the generality of the foregoing indemnification, but subject in each case to clauses (a), (b) and (c) above, Originator shall indemnify Buyer for Indemnified Amounts relating to or resulting from:

16


        Section 6.2    Other Costs and Expenses.    Originator shall pay to Buyer on demand all costs and out-of-pocket expenses in connection with the preparation, execution, delivery and administration of this Agreement, the transactions contemplated hereby and the other documents to be delivered hereunder. Originator shall pay to Buyer on demand any and all costs and expenses of Buyer, if any, including reasonable counsel fees and expenses in connection with the enforcement of this Agreement and the other documents delivered hereunder and in connection with any restructuring or workout of this Agreement or such documents, or the administration of this Agreement following a Termination Event.

17


        Section 6.3    Control of Defense.    Unless an Indemnified Party reasonably determines that its business reputation is the essence of a claim for which it is seeking indemnification pursuant to this Article VI (each such claim, an "Excluded Claim" ), Originator, when required or reasonably expected to be required, to indemnify such Indemnified Party pursuant to this Article VI, may in its sole discretion assume the defense, conduct or settlement of any claim except an Excluded Claim giving rise to an Indemnified Amount (an "Other Claim" ) with counsel reasonably satisfactory to such Indemnified Party. After notice from Originator to such Indemnified Party of its election so to assume the defense, conduct or settlement of such Other Claim, Originator shall not be liable to such Indemnified Party for any legal or other expenses subsequently incurred by such Indemnified Party in connection with the defense, conduct or settlement of such Other Claim. Such Indemnified Party shall cooperate with Originator in connection with any Other Claim resolution, making personnel and books and records (to the extent not inconsistent with any applicable privilege) relevant to the Other Claim available to Originator, and grant such authorizations or powers of attorney to the agents, representatives and counsel of Originator as it may reasonably consider desirable in connection with the defense of any such Other Claim. In the event that Originator does not wish to assume the defense, conduct or settlement of any Other Claim giving rise to an Indemnified Amount, the Indemnified Party shall not settle any such Other Claim for an amount in excess of $50,000 without the consent of Originator, which consent shall not be unreasonably withheld. Each Indemnified Party shall use its reasonable best efforts consistent with sound business practice to defend and mitigate any claim giving rise to an Indemnified Amount.


ARTICLE VII
MISCELLANEOUS

        Section 7.1    Waivers and Amendments.    

        Section 7.2    Notices.    All communications and notices provided for hereunder shall be in writing (including bank wire, telecopy or electronic facsimile transmission or similar writing) and shall be given to the other parties hereto at their respective addresses or telecopy numbers set forth on the signature pages hereof or at such other address or telecopy number as such Person may hereafter specify for the purpose of notice to each of the other parties hereto. Each such notice or other communication shall be effective (a) if given by telecopy, upon the receipt thereof, (b) if given by mail, three (3) Business Days after the time such communication is deposited in the mail with first class postage prepaid or (c) if given by any other means, when received at the address specified in this Section 7.2.

        Section 7.3    Protection of Ownership Interests of Buyer.    

18


        Section 7.4    Confidentiality.    

19


        Section 7.5    Bankruptcy Petition.    

        Section 7.6    Limitation of Liability.    Except with respect to any claim arising out of the willful misconduct or gross negligence of Blue Ridge, the Agent or any Liquidity Bank, no claim may be made by Originator or any other Person against Blue Ridge, the Agent or any Liquidity Bank or their respective Affiliates, directors, officers, employees, attorneys or agents for any special, indirect, consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement, or any act, omission or event occurring in connection therewith; and Originator hereby waives, releases, and agrees not to sue upon any claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.

        Section 7.7    CHOICE OF LAW.    THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF NEW YORK.

        Section 7.8    CONSENT TO JURISDICTION.    ORIGINATOR HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL

20



OR NEW YORK STATE COURT SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY ORIGINATOR PURSUANT TO THIS AGREEMENT AND ORIGINATOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF BUYER (OR ITS ASSIGNS) TO BRING PROCEEDINGS AGAINST ORIGINATOR IN THE COURTS OF ANY OTHER JURISDICTION.

        Section 7.9    WAIVER OF JURY TRIAL.    EACH PARTY HERETO HEREBY WAIVES TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY DOCUMENT EXECUTED BY ORIGINATOR PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP ESTABLISHED HEREUNDER OR THEREUNDER.

        Section 7.10    Integration; Binding Effect; Survival of Terms.    

        Section 7.11    Counterparts; Severability; Section References.    This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same Agreement. Any provisions of this Agreement which are prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Unless otherwise expressly indicated, all references herein to " Article, " " Section, " " Schedule " or " Exhibit " shall mean articles and sections of, and schedules and exhibits to, this Agreement.

21


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their duly authorized officers as of the date hereof.

  ADC TELECOMMUNICATIONS SALES, INC.

 

 

By:

/s/  ROBERT E. SWITZ       
  Name:Robert E. Switz
  Title:Senior Vice President and Chief Financial Officer
      Address:  13625 Technology Drive
Eden Prairie, Minnesota 55344
  ADC TELECOMMUNICATIONS, INC., AS
ORIGINATOR AGENT

 

 

By:

/s/  ROBERT E. SWITZ       
  Name:Robert E. Switz
  Title:Senior Vice President and Chief Financial Officer
      Address:  13625 Technology Drive
Eden Prairie, Minnesota 55344
  ADC RECEIVABLES CORP. I

 

 

By:

/s/  GOKUL V. HEMMADY       
  Name:Gokul V. Hemmady
  Title:Vice President and Treasurer
      Address:  13625 Technology Drive
Eden Prairie, Minnesota 55344

[Signature Page to the Receivables Sale Agreement]



Exhibit I

Definitions

        This is Exhibit I to the Agreement (as hereinafter defined). As used in the Agreement and the Exhibits and Schedules thereto, capitalized terms have the meanings set forth in this Exhibit I (such meanings to be equally applicable to the singular and plural forms thereof). If a capitalized term is used in the Agreement, or any Exhibit or Schedule thereto, and is not otherwise defined therein or in this Exhibit I, such term shall have the meaning assigned thereto in Exhibit I  to the Purchase Agreement (hereinafter defined).

         "ADC Telecom" has the meaning set forth in the preamble to the Agreement.

         "Agent" has the meaning set forth in the Preliminary Statements to the Agreement.

         "Agreement" means the Receivables Sale Agreement, dated as of December 12, 2001, among Originator, Originator Agent and Buyer, as the same may be amended, restated or otherwise modified.

         "Blue Ridge" has the meaning set forth in the Preliminary Statements to the Agreement.

         "Buyer" has the meaning set forth in the preamble to the Agreement.

         "Buyer Payment" means any payment by the Buyer of the Purchase Price for the Receivables.

         "Calculation Period" means each calendar month or portion thereof which elapses during the term of the Agreement. The first Calculation Period shall commence on the date of the Purchases hereunder and the final Calculation Period shall terminate on the Termination Date.

         "Change of Control" means the acquisition by any Person, or two or more Persons acting in concert, of beneficial ownership (within the meaning of Rule 13d-3 of the Securities and Exchange Commission under the Securities Exchange Act of 1934) of 25% or more of the outstanding shares of voting stock of Originator or Originator Agent

         "Credit and Collection Policy" means Originator's credit and collection policies and practices relating to Contracts and Receivables existing on the date hereof and summarized in Exhibit V , as modified from time to time in accordance with the Agreement.

         "Default Fee" means a per annum rate of interest equal to the sum of (i) the Prime Rate, plus (ii) 2% per annum.

         "Discount Factor" means a percentage calculated to provide Buyer with a reasonable return on its investment in the Receivables after taking account of (i) the time value of money based upon the anticipated dates of collection of the Receivables and the cost to Buyer of financing its investment in the Receivables during such period and (ii) the risk of nonpayment by the Obligors. Originator and Buyer may agree from time to time to change the Discount Factor based on changes in one or more of the items affecting the calculation thereof, provided that any change to the Discount Factor shall take effect as of the commencement of a Calculation Period, shall apply only prospectively and shall not affect the Purchase Price payment made prior to the Calculation Period during which Originator and Buyer agree to make such change. As of the date of the First Amendment, the Discount Factor in respect of Eligible Receivables and the Discount Factor in respect of all other Receivables will each be as specified in the First Amendment.

         "Domestic Person" means (a) any individual that is a citizen of the United States of America who maintains his or her primary residence in the United States of America, or (b) any Person (other than an individual) that is organized under the laws of the United States of America or any state or political subdivision thereof.

2


         "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and any rule or regulation issued thereunder.

         "ERISA Affiliate" means any trade or business (whether or not incorporated) under common control with Originator Agent within the meaning of Section 414(b) or (c) of the Tax Code (and Sections 414(m) and (o) of the Tax Code for purposes of provisions relating to Section 412 of the Tax Code).

         "ERISA Event" means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by Originator Agent or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer (as defined in Section 4001 (a) (2) of ERISA) or a cessation of operations which is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by Originator Agent or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or condition which might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Tide IV of ERISA, other than PBGC premiums due but not delinquent under Section 4007 of ERISA, upon Originator Agent or any ERISA Affiliate.

         "Initial Contributed Receivables" has the meaning set forth in Section 1.1.

         "Initial Cutoff Date" has the meaning set forth in Section 1.1 .

         "Material Adverse Effect" means a material adverse effect on (i) the financial condition or operations of Originator Agent and its Subsidiaries, taken as a whole, (ii) the ability of Originator or Originator Agent to perform its obligations under the Agreement or any other Transaction Document, (iii) the legality, validity or enforceability of the Agreement or any other Transaction Document, (iv) Originator's, Buyer's, the Agent's or any Purchaser's interest in the Receivables generally or in any significant portion of the Receivables, the Related Security or Collections with respect thereto, or (v) the collectibility of the Receivables generally or of any material portion of the Receivables.

         "Material Indebtedness" means Indebtedness of ADC Telecom of any of its consolidated Subsidiaries which, individually or in the aggregate, exceeds $10,000,000 in aggregate principal amount.

         "Moody's" means Moody's Investors Service, Inc.

         "Multiemployer Plan" means a "multiemployer plan", within the meaning of Section 4001 (a) (3) of ERISA, to which Originator Agent or any ERISA Affiliate makes, is making, or is obligated to make contributions or, during the preceding three calendar years, has made, or been obligated to make, contributions.

         "Net Worth" means as of the last Business Day of each Calculation Period preceding any date of determination, the excess, if any, of (a) the aggregate Outstanding Balance of the Receivables at such time, over (b) the sum of (i) the Aggregate Invested Amount outstanding at such time, plus (ii) the aggregate outstanding principal balance of the Subordinated Loans (including any Subordinated Loan proposed to be made on the date of determination).

         "Organizational Documents" means, for any Person, the documents for its formation and organization, which, for example, (a) for a corporation are its corporate charter and bylaws, (b) for a partnership are its certificate of partnership (if applicable) and partnership agreement, (c) for a limited liability company are its certificate of formation or organization and its operating agreement, regulations or the like and (d) for a trust is the trust agreement, declaration of trust, indenture or bylaws under which it is created.

3



         "Original Balance" means, with respect to any Receivable coming into existence after the Initial Cutoff Date, the Outstanding Balance of such Receivable on the date it was created.

         "Originator" has the meaning set forth in the preamble to the Agreement.

         "Originator Agent" has the meaning set forth in the preamble to the Agreement.

         "PBGC" means the Pension Benefit Guaranty Corporation, or any successor thereto.

         "Pension Plan" means a pension plan (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA which Originator sponsors or maintains, or to which it makes, is making, or is obligated to make contributions, or in the case of a multiple employer plan (as described in Section 4064(a) of ERISA) has made contributions at any time during the immediately preceding five plan years.

         "Plan" means an employee benefit plan (as defined in Section 3(3) of ERISA) which Originator Agent sponsors or maintains or to which Originator Agent makes, is making, or is obligated to make contributions and includes any Pension Plan, other than a Plan maintained outside the United States primarily for the benefit of Persons who are not U.S. residents.

         "Purchase" means the purchase pursuant to Section 1.2(a)   of the Agreement by Buyer from Originator of the Receivables and the Related Security and Collections related thereto, together with all related rights in connection therewith.

         "Purchase Agreement" has the meaning set forth in the Preliminary Statements to the Agreement.

         "Purchase Price" means, with respect to the Purchase, the aggregate price to be paid by Buyer to Originator Agent, for the benefit of Originator, in accordance with Section 1.3   of the Agreement for the Receivables, Collections and Related Security being sold to Buyer, which price shall equal on any date (i) the product of (x) the Outstanding Balance of such Receivables on such date, multiplied by (y) one minus the Discount Factor in effect on such date, minus (ii) any Purchase Price Credits to be credited against the Purchase Price otherwise payable in accordance with Section 1.4   of the Agreement.

         "Purchase Price Credit" has the meaning set forth in Section 1.4   of the Agreement.

         "Purchase Report" has the meaning set forth in Section 1.2(b)   of the Agreement.

         "Receivable" means all indebtedness and other obligations owed by any Domestic Person to Originator (at the times it arises, and before giving effect to any transfer or conveyance under the Agreement) or to Buyer (after giving effect to the transfers under the Agreement) or in which Originator or Buyer has a security interest or other interest, including, without limitation, any indebtedness, obligation or interest constituting an account, chattel paper, instrument or general intangible, arising in connection with the sale of goods or the rendering of services by Originator, and further includes, without limitation, the obligation to pay any Finance Charges with respect thereto. Indebtedness and other rights and obligations arising from any one transaction, including, without limitation, indebtedness and other rights and obligations represented by an individual invoice, shall constitute a Receivable separate from a Receivable consisting of the indebtedness and other rights and obligations arising from any other transaction; provided , further , that any indebtedness, rights or obligations referred to in the immediately preceding sentence shall be a Receivable regardless or whether the account debtor or Originator treats such indebtedness, rights or obligations as a separate payment obligation.

         "Related Security" means, with respect to any Receivable:

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"Reportable Event" means any of the events set forth in Section 4043(c) of ERISA or the regulations thereunder, other than any such event for which the 30-day notice requirement under ERISA has been waived in regulations issued by the PBGC.

         "Required Capital Amount" means, as of any date of determination, an amount in cash, assets or a mixture of both (including Initial Contributed Receivables) equal to the greater of (a) 3% of the Purchase Limit under the Purchase Agreement, and (b) the product of (i) 1.5 times the product of the Default Ratio times the Default Horizon Ratio , each as determined from the most recent Monthly Report received from the Servicer under the Purchase Agreement, and (ii) the Outstanding Balance of all Receivables as of such date, as determined from the most recent Monthly Report received from the Servicer under the Purchase Agreement.

         "S&P" means Standard and Poor's Ratings Services, a division of The McGraw Hill Companies, Inc.

         "Settlement Date" means, with respect to each Calculation Period, the date that is the calendar day of the month following such Calculation Period specified in the First Amendment.

         "Subordinated Loan" has the meaning set forth in Section 1.3(a)   of the Agreement.

         "Subordinated Note" means a promissory note in substantially the form of Exhibit VI   hereto as more fully described in Section 1.3   of the Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.

         "Tax Code" means the Internal Revenue Code of 1986, as the same may be amended from time to time.

         "Termination Date" means the earliest to occur of (i) the Facility Termination Date (as defined in the Purchase Agreement), (ii) the Business Day immediately prior to the occurrence of a Termination Event set forth in Section 5.1(d) , (iii) the Business Day specified in a written notice from Buyer to Originator following the occurrence of any other Termination Event, and (iv) the date which is 5 Business Days after Buyer's receipt of written notice from Originator that it wishes to terminate the facility evidenced by this Agreement.

         "Termination Event" has the meaning set forth in Section 5.1   of the Agreement.

         "Transaction Documents" means, collectively, this Agreement, each Collection Account Agreement, the Subordinated Note, and all other instruments, documents and agreements executed and delivered in connection herewith.

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         "Unmatured Termination Event" means an event which, with the passage of time or the giving of notice, or both, would constitute a Termination Event.

         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.

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Source: OneCLE Business Contracts.