Sale And Contribution Agreement

EXHIBIT 10(e)(1)

ANNEX X

To

SALE AND CONTRIBUTION AGREEMENT,

and

RECEIVABLES PURCHASE AND SERVICING AGREEMENT

each dated as of

March 28, 2002

Definitions and Interpretation

SECTION 1. Definitions and Conventions. Capitalized terms used in the Sale and Contribution Agreement and the Purchase Agreement shall have (unless otherwise provided elsewhere therein) the following respective meanings:

" Accession Agreement " shall mean an Accession Agreement substantially in the form of Exhibit A to the Collateral Agent Agreement.

" Accounting Changes " shall mean, with respect to any Person, (a) changes in accounting principles required by the promulgation of any rule, regulation, pronouncement or opinion of the Financial Accounting Standards Board of the American Institute of Certified Public Accountants (or any successor thereto or any agency with similar functions); (b) changes in accounting principles concurred in by such Person's certified public accountants; (c) purchase accounting adjustments under A.P.B. 16 or 17 and EITF 88-16, and the application of the accounting principles set forth in FASB 109, including the establishment of reserves pursuant thereto and any subsequent reversal (in whole or in part) of such reserves; and (d) the reversal of any reserves established as a result of purchase accounting adjustments.

" Accounts " shall mean the Collection Account, the Lockbox Accounts and the Retention Account, collectively.

" Accrued Monthly Yield " shall mean, as of any date of determination within a Settlement Period, the sum of the Daily Yields for each day from and including the first day of the Settlement Period through and including such date.

" Accrued Servicing Fee " shall mean, as of any date of determination within a Settlement Period, the sum of the Servicing Fees calculated for each day from and including the first day of the Settlement Period through and including such date.

" Accrued Unused Commitment Fee " shall mean, as of any date of determination within a Settlement Period, the sum of the Unused Commitment Fees calculated for each day from and including the first day of the Settlement Period through and including such date.

" Accumulated Funding Deficiency " shall mean an "accumulated funding deficiency" as defined in Section 412 of the IRC and Section 302 of ERISA, whether or not waived.

" Additional Amounts " shall mean any amounts payable to any Affected Party under Sections 2.09 or 2.10 of the Purchase Agreement.

" Additional Costs " shall have the meaning assigned to it in Section 2.09(b) of the Purchase Agreement.

" Administrative Agent " shall have the meaning set forth in the Preamble of the Purchase Agreement.

" Administrative Services Agreement " shall mean that certain Administrative Services Agreement dated as of March 7, 2000, between Redwood and the Operating Agent.

" Adverse Claim " shall mean any claim of ownership or any Lien, other than any ownership interest or Lien created under the Sale and Contribution Agreement or the Purchase Agreement or any Lien created under the Collateral Agent Agreement.

" Affected Party " shall mean each of the following Persons: the Conduit Purchaser, the Committed Purchaser, the Liquidity Agent, each Liquidity Lender, the Administrative Agent, the Operating Agent, the Letter of Credit Agent, each Letter of Credit Provider, the Collateral Agent, the Depositary and each Affiliate of the foregoing Persons.

" Affiliate " shall mean, with respect to any Person, (a) each Person that, directly or indirectly, owns or controls, whether beneficially, or as a trustee, guardian or other fiduciary, ten percent (10%) or

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more of the Stock having ordinary voting power in the election of directors of such Person, (b) each Person that controls, is controlled by or is under common control with such Person, or (c) each of such Person's officers, directors, joint venturers and partners. For the purposes of this definition, "control" of a Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise.

" Ancillary Services and Lease Agreement " shall mean that certain Ancillary Services and Lease Agreement dated as of March 28, 2002 between the Parent and the Seller.

" Appendices " shall mean, with respect to any Related Document, all exhibits, schedules, annexes and other attachments thereto, or expressly identified thereto.

" Applicable Purchaser " shall mean (i) prior to the occurrence of a Committed Purchaser Funding Event, the Conduit Purchaser, and (ii) on and after the occurrence of a Committed Purchaser Funding Event, the Committed Purchaser.

" Applicable Servicing Fee " shall mean, as of any Settlement Date, with respect to each Servicer other than the Master Servicer, an amount equal to (a) the Servicing Fee received by the Master Servicer or its Successor Servicer on such Settlement Date pursuant to Section 2.07(b) of the Purchase Agreement less the Master Servicer's portion of such Servicing Fee, multiplied by (b) a percentage equal to (i) the Outstanding Balance of Transferred Receivables, as of the last day of the related Settlement Period, sold by such Servicer in its capacity as an Originator under the Sale and Contribution Agreement divided by (ii) the Outstanding Balance of all Transferred Receivables as of the last day of the related Settlement Period.

" Authorized Officer " shall mean, with respect to any corporation, the Chairman or Vice-Chairman of the Board, the President, any Vice President, the Secretary, the Treasurer, any Assistant Secretary, any Assistant Treasurer and each other officer of such corporation specifically authorized in resolutions of the board of directors of such corporation to sign agreements, instruments or other documents on behalf of such corporation in connection with the transactions contemplated by the Sale and Contribution Agreement, the Purchase Agreement and the other Related Documents.

" Availability " shall mean, as of any date of determination, the amount equal to the lesser of: (a) (i) the Investment Base multiplied by the Purchase Discount Rate, minus (ii) the Discount and Servicer Fee Reserve and (b) the Maximum Purchase Limit.

" Available LOC Percentage " shall mean fifteen percent (15.0%)

" Bankruptcy Code " shall mean the provisions of title 11 of the United States Code, 11 U.S.C. a7 a7 101 et seq .

" Billed Amount " shall mean, with respect to any Receivable, the amount billed on the Billing Date to the Obligor thereunder.

" Billing Date " shall mean, with respect to any Receivable, the date on which the invoice with respect thereto was generated.

" Breakage Costs " shall have the meaning assigned to it in Section 2.10 of the Purchase Agreement.

" Bringdown Certificate " shall mean and Officer's Certificate substantially in the form of Exhibit 3.01(a)(ii)(B) and 3.01(a)(iii)(B), as applicable, to the Purchase Agreement.

" Business Day " shall mean any day that is not a Saturday, a Sunday or a day on which banks are required or permitted to be closed in the State of New York or the State of California.

" Buyer " shall have the meaning assigned to it in the preamble of the Sale and Contribution Agreement.

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" Buyer Indemnified Person " shall have the meaning assigned to it in Section 5.01 of the Sale and Contribution Agreement.

" Canadian Obligor Reserve Amount " shall mean, as of any date of determination after giving effect to all Eligible Receivables to be Transferred on such date and the application of Collections thereon on such date, the amount by which the aggregate Outstanding Balance of Receivables due from Obligors organized and/or domiciled in Canada (exclusive of Receivables owing by any Canadian Subsidiaries of Wal-Mart Stores, Inc., provided, that if Canada shall fail to have a long-term foreign currency rating of AA or higher from S&P or Aa1 or higher from Moody's, inclusive of Receivables owing by any Canadian Subsidiaries of Wal-Mart Stores, Inc.) and payable in Dollars exceeds 5.0% of the aggregate Outstanding Balance of Eligible Receivables.

" Capital Investment " shall mean, as of any date of determination with respect to any Purchaser, the amount equal to (a) the aggregate deposits made by such Purchaser to the Collection Account pursuant to Section 2.04(b)(i) of the Purchase Agreement on or before such date, plus (b) in the case of the Committed Purchaser only, any amounts advanced by the Committed Purchaser (in its capacity as a Liquidity Lender) to the Conduit Purchaser under the LAPA in respect of Capital Investment when purchasing the Conduit Purchaser's Purchaser Interests, minus (c) in the case of the Conduit Purchaser only, any amounts advanced by the Committed Purchaser to the Conduit Purchaser under the LAPA in respect of Capital Investment when purchasing the Conduit Purchaser's Purchaser Interests, minus (d) the sum of all amounts disbursed to such Purchaser in reduction of Capital Investment pursuant to Sections 6.03, 6.04 or 6.05 of the Purchase Agreement on or before such date.

" Capital Investment Available " shall mean, as of any date of determination, the amount, if any, by which Availability exceeds Capital Investment, in each case as of the end of the immediately preceding day.

" Capital Lease " shall mean, with respect to any Person, any lease of any property (whether real, personal or mixed) by such Person as lessee that, in accordance with GAAP, would be required to be classified and accounted for as a capital lease on a balance sheet of such Person.

" Capital Lease Obligation " shall mean, with respect to any Capital Lease of any Person, the amount of the obligation of the lessee thereunder that, in accordance with GAAP, would appear on a balance sheet of such lessee in respect of such Capital Lease.

" Capital Purchase " shall have the meaning assigned to it in Section 2.01 of the Purchase Agreement.

" Capital Purchase Request " shall have the meaning assigned to it in Section 2.03(b) of the Purchase Agreement.

" Change of Control " shall mean, with respect to Parent Guarantor, the SPC, any Servicer, and Originator or the Seller, any event, transaction or occurrence as a result of which (a) any person or group of persons (within the meaning of the Securities Exchange Act of 1934, as amended) shall have acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated by the Securities Exchange Commission under the Securities Exchange Act of 1934, as amended) of 50% or more of the issued and outstanding shares of capital Stock of the Parent Guarantor having the right to vote for the election of directors of the respective entity under ordinary circumstances; (b) during any twelve (12) consecutive calendar months ending after the Closing Date, individuals who at the beginning of such twelve-month period constituted the board of directors of the Parent or such Person (together with any new directors whose election by such board or whose nomination for election by the shareholders of the Parent or such Person was approved by a vote of a majority of the directors still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) shall cease for any reason to constitute a majority of the board of directors of the Parent or such Person then in office; (c) the Parent shall cease to own and control

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directly or indirectly all of the economic and voting rights associated with all of the outstanding Stock of the Servicers, the SPC, the Originators or of the Seller, (d) the Parent has sold, transferred, conveyed, assigned or otherwise disposed of all or substantially all of the assets of the Parent, or (e) the Originators, together with the SPC, shall fail to own 100% of the outstanding Stock of the Seller.

" Charter Documents " shall mean, with respect to any corporation or limited liability company, such Person's articles or certificate of incorporation or formation and such entity's bylaws or operating agreement.

" Closing Date " shall mean March 28, 2002.

" Collateral Agent " shall mean GE Capital, in its capacity as collateral agent for the Conduit Purchaser and the Conduit Purchaser Secured Parties pursuant to the Collateral Agent Agreement.

" Collateral Agent Agreement " shall mean that certain Third Amended and Restated Collateral Agent and Security Agreement dated as of March 7, 2000, among Redwood, the Depositary and GE Capital, in its capacities as (a) the Collateral Agent, (b) the Operating Agent, (c) the Liquidity Agent and (d) the Letter of Credit Agent.

" Collection Account " shall mean (a) prior to a Committed Purchaser Funding Event, that certain segregated deposit account established by the Conduit Purchaser and maintained with the Depositary designated as the "Redwood Receivables Corporation- Collection Account (K2)," account number 00-386-310, ABA No. 021001033, Attn: Collection Account #33487, or such other account established in accordance with the requirements set forth in Section 6.01(b) of the Purchase Agreement, and (b) following the occurrence of a Committed Purchaser Funding Event, an account established by the Administrative Agent designated as the Purchasers' Collection Account (K2) and otherwise in accordance with the requirements set forth in Section 6.01(b) of the Purchase Agreement.

" Collections " shall mean, with respect to any Receivable, all cash collections and other proceeds of such Receivable (including late charges, fees and interest arising thereon, and all recoveries with respect thereto that have been written off as uncollectible).

" Commercial Paper " shall mean those certain short-term promissory notes issued by the Conduit Purchaser (or, with respect to the Committed Purchaser, by GE Capital), from time to time in the United States of America commercial paper market.

" Committed Purchaser " shall mean GE Capital, its successors and assigns.

" Committed Purchaser Daily Yield " shall mean, for any day, the product of (i) the sum of the Committed Purchaser Daily Yield Rate for such day, plus the Daily Margin on such day, plus , if a Termination Event has occurred and is continuing, the Daily Default Margin, multiplied by (ii) the Committed Purchaser's Capital Investment outstanding on such day.

" Committed Purchaser Daily Yield Rate " shall mean, for any day during a Settlement Period after the occurrence of a Committed Purchaser Funding Event, (a) the weighted average Committed Purchaser Yield Rates applicable to the Committed Purchaser's Capital Investment on such day, weighted by outstanding Capital Investment, divided by (b) 360.

" Committed Purchaser Funding Event " shall mean the occurrence of (a) a Redwood Termination Date, but only if no Termination Event has occurred and is continuing or (b) the Redwood Transfer Date.

" Committed Purchaser Yield Rate " shall mean, with respect to any portion of the Committed Purchaser's Capital Investment on any day during a Settlement Period, the LIBOR Rate for such Settlement Period or portion thereof, as applicable.

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" Commitment Reduction Notice " shall have the meaning assigned to it in Section 2.02(a) of the Purchase Agreement.

" Commitment Termination Notice " shall have the meaning assigned to it in Section 2.02(b) of the Purchase Agreement.

" Computer Hardware " shall mean, with respect to any Person, (i) all computer and other electronic data processing hardware, whether now or hereafter owned, licenses or leased by such Person, including, without limitation, all integrated computer systems, central processing units, memory units, display terminals, printers, features, computer elements, card readers, tape drives, hard and soft disk drives, cables, electrical supply hardware, generators, power equalizers, accessories and all peripheral devices and other related computer hardware, (ii) all firmware associated with the foregoing, whether now or hereafter owned, licenses or leased by such Debtor, and (iii) all documentation for the hardware and firmware described in the preceding clauses, whether now or hereafter owned, licenses or leased by such Debtor, including, without limitation, flow charts, logic diagrams, manuals, specifications, training materials, charts and pseudo codes.

" Concentration Discount Amount " shall mean, with respect to any Obligor and its Affiliates, and as of any date of determination after giving effect to all Eligible Receivables to be Transferred on such date and the application of Collections thereon on such date, the amount by which the Outstanding Balance of Eligible Receivables owing by such Obligor and its Affiliates exceeds the product of (a) the larger of (i) the percentage (the " Concentration Limit ") set forth in the table below based upon the short-term unsecured senior debt rating and the long-term unsecured senior debt rating assigned to them at such time by S&P and Moody's (and, if such Obligor is rated by both agencies and has a split rating or the long-term debt rating is different from the short-term debt rating, the applicable rating will be the lower rating) and (ii) the Special Limit, if any, applicable to such Obligor, and (b) the Outstanding Balance of all Eligible Receivables on such date. S&P RATING/MOODY'S SHORT-TERM RATING S&P RATING/MOODY'S LONG-TERM RATING CONCENTRATION LIMIT A-1/P-1 A/A2 or higher 10.0% A-2/P-2 BBB+/Baa1 or higher 8.0% A-3/P-3 BBB-/Baa3 or higher 6.0% Below A-3/P-3 or Not Rated by either S&P or Moody's Below BBB-/Baa3 or Not Rated by either S&P or Moody's 4.0%

" Conduit Purchaser " shall mean Redwood and its assigns.

" Conduit Purchaser Secured Parties " shall mean the Collateral Agent, the CP Holders, the Depositary, the Liquidity Agent, the Liquidity Lenders, the Letter of Credit Agent and the Letter of Credit Providers.

" Contract " shall mean any agreement (including any invoice or billing statement) pursuant to, or under which, an Obligor shall be obligated to make payments with respect to any Receivable.

" Contributed Receivables " shall have the meaning assigned to it in Section 2.01(d) of the Sale and Contribution Agreement.

" CP Holder " shall mean any Person that holds record or beneficial ownership of Commercial Paper.

" Credit and Collection Policies " shall mean the credit, collection, customer relations and service policies of the Master Servicer and the Originators in effect on the Closing Date, as the same may from time to time be amended, restated, supplemented or otherwise modified with the written consent of the Administrative Agent.

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" Credit Facilities " shall mean the Parent Revolver, the 1992 Note Agreement, the 1999 Note Agreement and the other documents executed in connection therewith, together with such amendments, restatements, supplements or modifications thereto or any refinancings, replacements or refundings thereof as may be agreed to in writing by the Purchasers and the Administrative Agent.

" Credit Facilities' Security Documents " shall mean (i) the Pledge Agreement, dated as of the Closing Date, among the Credit Facility Agent, the Parent and certain subsidiaries thereof, attached as Exhibit D , (ii) the Membership Interest Pledge Agreement, dated as of the Closing Date, among the Credit Facility Agent, the Parent and certain subsidiaries thereof, attached as Exhibit E hereto, and (iii) the Security Agreement, dated as of the Closing Date, among the Credit Facility Agent, the Parent and certain subsidiaries thereof, attached as Exhibit F hereto, and, in each case, without giving effect to any amendments, restatements, supplements or other modifications made without the written consent of Administrative Agent.

" Credit Facility Agent " shall mean Bank of America, N.A. or its successor appointed as "Collateral Agent" pursuant to the Credit Facility Intercreditor Agreement.

" Credit Facility Intercreditor Agreement " shall mean that certain Amended and Restated Intercreditor Agreement among various creditors of Parent Guarantor and the Credit Facility Agent, attached as Exhibit C hereto.

" Daily Default Margin " shall mean, for any day on which a Termination Event has occurred and is continuing, two percent (2.0%) divided by 360.

" Daily Margin " shall mean, for any day, the Per Annum Daily Margin on such day divided by 360.

" Daily Yield " shall mean, for any day, the sum of (a) the Redwood Daily Yield for such day, and (b) the Committed Purchaser Daily Yield for such day.

" Daily Yield Rate " shall mean the Redwood Daily Yield Rate or the Committed Purchaser Daily Yield Rate, as the case may be.

" Dealer " shall mean any dealer party to a Dealer Agreement.

" Dealer Agreement " shall mean any dealer agreement entered into by Redwood for the distribution of Commercial Paper.

" Debt " of any Person shall mean, without duplication, (a) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services payment for which is deferred 90 days or more, but excluding obligations to trade creditors incurred in the ordinary course of business that are not overdue by more than 90 days unless being contested in good faith, (b) all reimbursement and other obligations with respect to letters of credit, bankers' acceptances and surety bonds, whether or not matured, (c) all obligations evidenced by notes, bonds, debentures or similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Capital Lease Obligations and Synthetic Lease Obligations, (f) net obligations under any Swap Contract in an amount equal to (i) if such Swap Contract has been closed out, the termination value thereof or (ii) if such Swap Contract has not been closed out, the mark-to-market value thereof determined on the basis of readily available quotations provided by any recognized dealer in such Swap Contract, (g) all liabilities of such Person under Title IV of ERISA, (h) all Guaranteed Indebtedness of such Person in respect of any of the foregoing, (i) all indebtedness referred to in clauses (a) through (h) above secured by (or for which the holder of such indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property or other assets (including accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such indebtedness, (j) the "Obligations" as such term is

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defined in the Parent Revolver, (k) the obligations under the Note Agreements and (l) the Seller Secured Obligations.

" Defaulted Receivable " shall mean any Receivable (a) with respect to which any payment, or part thereof, remains unpaid for more than 90 days from its Maturity Date, (b) with respect to which the Obligor thereunder has taken any action, or suffered any event to occur, of the type described in Sections 9.01(c) or 9.01(d) of the Purchase Agreement or (c) that otherwise is determined to be uncollectible and is written off in accordance with the Credit and Collection Policies.

" Default Ratio " shall mean, as of any date of determination, the ratio (expressed as a percentage) of:

(a) (i) the aggregate Outstanding Balances of all Transferred Receivables which constituted Defaulted Receivables as of the last day of the six Settlement Periods immediately preceding such date, plus (ii) the aggregate Outstanding Balances of Transferred Receivables that were written off as uncollectible during such six Settlement Periods.

to

(b) the aggregate Outstanding Balances of all Transferred Receivables as of the last day of the six Settlement Periods immediately preceding such date.

" Delinquency Ratio " shall mean, as of any date of determination, the ratio (expressed as a percentage) of:

(a) the aggregate respective Outstanding Balances of all Transferred Receivables which remain unpaid for more than 60 days but less than 91 days from their respective Maturity Date as of the last day of the six Settlement Periods immediately preceding such date

to

(b) the aggregate Outstanding Balances of all Transferred Receivables as of the last day of the six Settlement Periods immediately preceding such date.

" Depositary " shall mean Bankers Trust Company, or any other Person designated as the successor Depositary pursuant to and in accordance with the terms of the Depositary Agreement, in its capacity as issuing and paying agent or trustee in connection with the issuance of Commercial Paper.

" Depositary Agreement " shall mean that certain Depositary Agreement dated March 15, 1994, by and between Redwood and the Depositary and consented to by the Liquidity Agent.

" Dilution Factors " shall mean, with respect to any Receivable, any credits, rebates, freight charges, cash discounts, volume discounts, cooperative advertising expenses, royalty payments, warranties, cost of parts required to be maintained by agreement (whether express or implied), warehouse and other allowances, disputes, setoffs, chargebacks, defective returns, other returned or repossessed goods, inventory transfers, allowances for early payments and other similar allowances that are reflected on the books of each Originator and made or coordinated with the usual practices of the Originator thereof; provided , that any allowances or adjustments in accordance with the Credit and Collection Policies made on account of the insolvency of the Obligor thereunder or such Obligor's inability to pay shall not constitute a Dilution Factor.

" Dilution Ratio " shall mean, as of any date of determination, the ratio (expressed as a percentage) of:

(a) the aggregate Dilution Factors during the first Settlement Period immediately preceding such date

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to

(b) the aggregate Billed Amount of all Transferred Receivables originated during the fourth Settlement Period immediately preceding such date.

" Dilution Reserve Ratio " shall mean, as of any date of determination, the ratio (expressed as a percentage) equal to the greater of (a) 9.0 percent and (b) the ratio calculated in accordance with the following formula: [(ADR d7 2.00) + [(HDR - ADR) d7 HDR]] ADR d7 DILHOR NRPB where:
ADR =

the average of the respective Dilution Ratios as of the last day of the 12 Settlement Periods immediately preceding such date.
HDR =

the highest Two Month Rolling Dilution Ratio during the 12 Settlement Periods immediately preceding such date.
DILHOR =

the aggregate Billed Amount of Transferred Receivables originated during the three Settlement Periods immediately preceding such date.
NRPB =

the Outstanding Balance of Transferred Receivables as of the last day of the first Settlement Period immediately preceding such date.

" Dilution Trigger Ratio " shall mean, as of any date of determination, the ratio (expressed as a percentage) of:

(a) the aggregate Dilution Factors during the six Settlement Periods immediately preceding such date

to

(b) the aggregate Billed Amount of all Transferred Receivables originated during the fourth, fifth, sixth, seventh, eighth and ninth Settlement Periods immediately preceding such date.

" Discount and Servicer Fee Reserve " shall mean, at any time, the product of (a) the Index Rate, (b) Capital Investment and (c) a fraction, the numerator of which is the higher of (i) 30 and (ii) the most recently reported Receivables Collection Turnover, and the de ...