THIRD AMENDED AND RESTATED
STOCK PLEDGE AGREEMENT
THIS THIRD AMENDED AND RESTATED STOCK PLEDGE AGREEMENT dated as of
December 3, 1996 (the "Pledge Agreement") among Olympic Financial Ltd., a
Minnesota corporation (the "Pledgor"), as owner of all of the outstanding
capital stock in (a) Olympic Receivables Finance Corp., a Delaware
corporation ("ORFC"), (b) Olympic First GP Inc., a Delaware corporation
("First GP"), (c) Olympic Second GP Inc., a Delaware corporation ("Second
GP", together with First GP, the "General Partners") and (d) Arcadia
Receivables Conduit Corp., a Delaware corporation ("ARCC"), Financial
Security Assurance Inc., a New York stock insurance company ("Financial
Security") and Norwest Bank Minnesota, National Association, as collateral
agent (the "Collateral Agent") on behalf of Financial Security.
INTRODUCTORY STATEMENTS
The Pledgor is the sole shareholder of each of ORFC, First GP,
Second GP and ARCC (together, the "Pledged Entities"). The Pledgor and ORFC
have previously entered into three Pooling and Servicing Agreements pursuant
to which Olympic Automobiles Receivables Trust, 1993-A (the "Series 1993-A
Trust"), Olympic Automobile Receivables Trust, 1993-B (the "Series 1993-B
Trust") and Olympic Automobiles Receivables Trust, 1995-A (the "Series 1995-A
Trust") were formed. Financial Security has issued a Series 1993-A Policy
with respect to the Series 1993-A Trust, a Series 1993-B Policy with respect
to the Series 1993-B Trust and a Series 1995-A Policy with respect to the
Series 1995-A Trust. The Pledgor, ORFC, First GP, Second GP, Financial
Security and Wilmington Trust Company, as Owner Trustee, have previously
entered into thirteen Trust Agreements pursuant to which Olympic Automobile
Receivables Trust, 1993-C (the "Series 1993-C Trust"), Olympic Automobile
Receivables Trust, 1993-D (the "Series 1993-D Trust"), Olympic Automobile
Receivables Trust, 1994-A (the "Series 1994-A Trust"), Olympic Automobile
Receivables Trust, 1994-B (the "Series 1994-B Trust"), Olympic Automobile
Receivables Trust, 1994-D (the "Series 1994-C Trust"), Olympic Automobile
Receivables Trust, 1994-D (the "Series 1994-D Trust"), Olympic Automobile
Receivables Trust, 1995-B (the "Series 1995-B Trust"), Olympic Automobile
Receivables Trust, 1995-C (the "Series 1995-C Trust"), Olympic Automobile
Receivables Trust, 1995-D (the "Series 1995-D Trust"), Olympic Automobile
Receivables Trust, 1995-E (the "Series 1995-E Trust"), Olympic Automobile
Receivables Trust, 1996-A
(the "Series 1996-A Trust"), Olympic Automobile Receivables Trust, 1996-B
(the "Series 1996-B Trust"), and Olympic Automobile Receivables Trust, 1996-C
(the "Series 1996-C Trust") were formed. Financial Security has issued a
Series 1993-C Certificate Policy and a Series 1993-C Note Policy with respect
to the Series 1993-C Trust, a Series 1993-D Certificate Policy and a Series
1993-D Note Policy with respect to the Series 1993-D Trust, a Series 1994-A
Certificate Policy and a Series 1994-A Note Policy with respect to the Series
1994-A Trust, a Series 1994-B Certificate Policy and a Series 1994-B Note
Policy with respect to the Series 1994-B Trust, a Series 1994-C Certificate
Policy and a Series 1994-C Note Policy with respect to the Series 1994-C
Trust, a Series 1994-D Certificate Policy and a Series 1994-D Note Policy
with respect to the Series 1994-D Trust, a Series 1995-B Certificate Policy
and a Series 1995-B Note Policy with respect to the Series 1995-B Trust, a
Series 1995-C Certificate Policy and a Series 1995-C Note Policy with respect
to the Series 1995-C Trust, a Series 1995-D Certificate Policy and a Series
1995-D Note Policy with respect to the Series 1995-D Trust, a Series 1995-E
Certificate Policy and a Series 1995-E Note Policy with respect to the Series
1995-E Trust, a Series 1996-A Certificate Policy and a Series 1996-A Note
Policy with respect to the Series 1996-A Trust, a Series 1996-B Certificate
Policy and a Series 1996-B Note Policy with respect to the Series 1996-B
Trust, and a Series 1996-C Certificate Policy and a Series 1996-C Note Policy
with respect to the Series 1996-C Trust.
Contemporaneously herewith, ORFC has agreed to sell to ARCC from
time to time all of its right, title and interest in and to certain motor
vehicle retail installment sale contracts and other property, and ARCC is
entering into an Indenture, dated as of November , 1996, between itself
and [ ] (the "Indenture"), pursuant to which the Issuer
is issuing certain notes (the "Warehousing Series"). Financial Security is
contemporaneously herewith issuing a Warehousing Series Policy in respect of
the Warehousing Notes.
In addition to the foregoing, the Pledgor and ORFC may enter into
one or more Pooling and Servicing Agreements or Trust Agreements and Sale and
Servicing Agreements and Financial Security may issue additional policies
(such policies together with the Series 1993-A Policy, Series 1993-B Policy,
the Series 1993-C Certificate Policy, the Series 1993-C Note Policy, the
Series 1993-D Certificate Policy, the Series 1993-D Note Policy, the Series
1994-A Certificate Policy, the Series 1994-A Note Policy, the Series 1994-B
Certificate Policy, the Series 1994-B Note Policy, the Series 1994-C
Certificate Policy, the Series 1994-C Note Policy, the Series 1994-D
Certificate Policy, the Series 1994-D Note Policy, the Series 1995-A Policy,
the Series 1995-B Certificate Policy, the Series 1995-B Note Policy, the
Series 1995-C Certificate Policy, the Series 1995-C Note Policy, the Series
1995-D Certificate Policy, the Series 1995-D Note Policy, the 1995-E
Certificate Policy, the 1995-E Note Policy, the 1996-A Certificate Policy,
the 1996-A Note Policy, the Series 1996-B Certificate Policy, the 1996-B Note
Policy, the Series 1996-C
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Certificate Policy, the Series 1996-C Note Policy and the Warehousing Series
Policy, the "Policies") with respect to certain guaranteed distributions and
guaranteed payments on the corresponding additional series of certificates
and notes (such series together with Series 1993-A, Series 1993-B, Series
1993-C, Series 1993-D, Series 1994-A, Series 1994-B, Series 1994-C, Series
1994-D, Series 1995-A, Series 1995-B, Series 1995-C, Series 1995-D, Series
1995-E, Series 1996-A, Series 1996-B, Series 1996-C and the Warehousing
Series, the "Series"). To secure the Insurer Secured Obligations (as defined
in the Spread Account Agreement referred to below) with respect to each
Series the Pledgor has agreed to pledge its interest as sole shareholder of
each of ORFC, First GP, Second GP and ARCC to the Collateral Agent on behalf
of Financial Security, all such interests represented by the stock
certificates listed on attached Schedule A (the "Pledged Shares").
In consideration of the premises and of the agreements herein
contained, the Pledgor, Financial Security and the Collateral Agent agree as
follows:
Section 1. DEFINITIONS. Capitalized terms used but not
otherwise defined in this Pledge Agreement shall have the meanings specified
therefor in the Insurance and Indemnity Agreement dated as of August 17, 1993
among Financial Security, the Trust, the Pledgor, ORFC, First GP, Second GP
and the Spread Account Agreement, dated as of March 25, 1993, as amended and
restated as of December 3, 1996, among the Pledgor, ORFC, Financial Security
and Norwest Bank Minnesota, National Association, as Collateral Agent.
Section 2. SECURITY INTEREST. As security for the full and
complete performance of all the Insurer Secured Obligations with respect to
each Series (the "Obligations"), the Pledgor hereby delivers, pledges and
assigns to the Collateral Agent on behalf of Financial Security, and creates
in the Collateral Agent on behalf of Financial Security, a first priority
security interest in all of the Pledgor's right, title and interest in and to
the Pledged Shares together with all of the Pledgor's rights and privileges
with respect thereto, all proceeds, income and profits thereof and all
property received in exchange thereof or in substitution therefor (the
"Collateral").
Section 3. STOCK DIVIDENDS, OPTIONS, OR OTHER ADJUSTMENTS.
Until the occurrence of the last Insurer Termination Date with respect to any
Series, the Pledgor shall deliver, as Collateral, to the Collateral Agent,
any and all additional shares of stock or any other property of any kind
distributable on or by reason of the Collateral, whether in the form of or by
way of stock dividends, warrants, total or partial liquidation, conversion,
prepayments, redemptions or otherwise, with the sole exception of cash
dividends or cash interest payments, as the case may be. If any additional
shares of capital stock, instruments, or other property a security interest
in which can only be perfected by possession by the Collateral Agent, which
are distributable on or
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by reason of the Collateral pledged hereunder, shall come into the possession
or control of the Pledgor, the Pledgor shall forthwith transfer and deliver
such property to the Collateral Agent, as Collateral hereunder.
Section 4. DELIVERY OF SHARE CERTIFICATES; STOCK POWERS.
Simultaneously with the delivery of this Pledge Agreement, the Pledgor is
delivering to the Collateral Agent all instruments and stock certificates
representing the Collateral, together with stock powers duly executed in
blank by the Pledgor. The Pledgor shall promptly deliver to the Collateral
Agent, or cause the relevant Pledged Entity or any other entity issuing the
Collateral to deliver directly to the Collateral Agent, share certificates or
other instruments representing any Collateral acquired or received after the
date of this Pledge Agreement with a stock or bond power duly executed by the
Pledgor. If at any time either the Collateral Agent or Financial Security
notifies the Pledgor that it requires additional stock powers endorsed in
blank, the Pledgor shall promptly execute in blank and deliver the requested
power to the requesting party.
Section 5. POWER OF ATTORNEY. The Pledgor hereby constitutes
and irrevocably appoints the Collateral Agent and Financial Security, or
either one acting alone, with full power of substitution and revocation, as
the Pledgor's true and lawful attorney-in-fact, with the power, after the
occurrence of a Stock Pledge Event (as defined in Section 11 hereof), to the
full extent permitted by law, to affix to any certificates and documents
representing the Collateral the stock or bond powers delivered with respect
thereto, and to transfer or cause the transfer of the Collateral, or any part
thereof, on the books of each Pledged Entity or other entity issuing such
Collateral, to the name of the Collateral Agent or Financial Security or any
nominee, and thereafter to exercise with respect to such Collateral, all the
rights, powers and remedies of an owner. The power of attorney granted
pursuant to this Pledge Agreement and all authority hereby conferred are
granted and conferred solely to protect Financial Security's interest in the
Collateral and shall not impose any duty upon the Collateral Agent or
Financial Security to exercise any power. This power of attorney shall be
irrevocable as one coupled with an interest until the occurrence of the last
Insurer Termination Date with respect to any Series.
Section 6. INDUCING REPRESENTATIONS OF THE PLEDGOR. The
Pledgor represents and warrants to Financial Security that:
(a) The Pledged Shares are validly issued, fully paid for and
non-assessable.
(b) The Pledged Shares represent all of the issued and
outstanding capital stock of each of ORFC, First GP, Second GP and ARCC.
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(c) The Pledgor is the sole legal and beneficial owner of,
and has good and marketable title to, the Pledged Shares, free and clear of
all pledges, liens, security interests and other encumbrances other than the
security interest created by this Pledge Agreement, and the Pledgor has the
unqualified right and authority to execute and perform this Pledge Agreement.
(d) No options, warrants or other agreements with respect to
the Collateral are outstanding.
(e) Any consent, approval or authorization of or designation
or filing with any authority on the part of the Pledgor which is required in
connection with the pledge and security interest granted under this Pledge
Agreement has been obtained or effected.
(f) Neither the execution and delivery of this Pledge
Agreement by the Pledgor, the consummation of the transaction contemplated
hereby nor the satisfaction of the terms and conditions of this Pledge
Agreement:
(i) conflicts with or results in any breach or
violation of any provision of the articles of incorporation or bylaws of the
Pledgor or any law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award currently in effect having applicability to
the Pledgor or any of its properties, including regulations issued by an
administrative agency or other governmental authority having supervisory
powers over the Pledgor;
(ii) conflicts with, constitutes a default (or an
event which with the giving of notice or the passage of time, or both, would
constitute a default) by the Pledgor under, or a breach of or contravenes any
provision of, the Transaction Documents related to any Series, any loan
agreement, mortgage, indenture or other agreement or instrument to which the
Pledgor or any of its Subsidiaries is a party or by which it or any of their
properties is or may be bound or affected; or
(iii) results in or requires the creation of any
Lien upon or in respect of any of the Pledgor's assets except the Lien
created by this Pledge Agreement.
(g) Upon the Pledgor's delivery of the Pledged Shares to the
Collateral Agent, the Collateral Agent, on behalf of Financial Security, will
have a valid, perfected first priority Lien on the Collateral, enforceable as
such against all creditors of the Pledgor and against all Persons purporting
to purchase any of the Collateral from the Pledgor.
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Section 7. OBLIGATIONS OF THE PLEDGOR. The Pledgor further
represents, warrants and covenants to Financial Security that:
(a) The Pledgor will not sell, transfer or convey any
interest in, or suffer or permit any Lien or encumbrance to be created upon
or with respect to, any of the Collateral (other than as created under this
Pledge Agreement) during the term of this Pledge Agreement.
(b) The Pledgor will, at its own expense, at any time and
from time to time at the request of the Collateral Agent or Financial
Security, do, make, procure, execute and deliver all acts, things, writings,
assurances and other documents as may be proposed by the Collateral Agent or
Financial Security to preserve, establish, demonstrate or enforce the
Collateral Agent's rights, interests and remedies as created by, provided in,
or emanating from this Pledge Agreement.
(c) The Pledgor will not take any action which would cause
any of the Subsidiaries to issue any other capital stock, without the prior
written consent of Financial Security so long as no Insurer Default has
occurred and is continuing. Any such issuance shall be subject to this
Pledge Agreement.
(d) The Pledgor will not consent to any amendment of any
Pledged Entity's Certificate of Incorporation without the prior written
consent of Financial Security prior to an Insurer Default.
Section 8. DIVIDENDS. (a) Pledgor agrees that it shall not
cause ORFC to declare or make payment of (i) any dividend or other
distribution on any shares of its capital stock, (ii) any payment on account
of the purchase, redemption, retirement or acquisition of (x) any option,
warrant or other right to acquire shares of its capital stock, unless (in
each case) at the time of such declaration or payment (and after giving
effect thereto) no amount payable by ORFC under any Transaction Document with
respect to any Series is then due and owing but unpaid.
(b) Pledgor agrees that it shall not cause First GP to
declare or make payment of (i) any dividend or other distribution on any
shares of its capital stock, (ii) any payment on account of the purchase,
redemption, retirement or acquisition of (x) any option, warrant or other
right to acquire shares of its capital stock, unless (in each case) at the
time of such declaration or payment (and after giving effect thereto) the
aggregate net worth of the two General Partners would be greater than the
Minimum Net Worth (as defined in the Trust Agreement).
(c) Pledgor agrees that it shall not cause Second GP to
declare or make payment of (i) any dividend or other distribution on any
shares of its capital stock, (ii) any payment on account of the purchase,
redemption, retirement or acquisition
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of (x) any option, warrant or other right to acquire shares of its capital
stock, unless (in each case) at the time of such declaration or payment (and
after giving effect thereto) the aggregate net worth of the two General
Partners would be greater than the Minimum Net Worth (as defined in the Trust
Agreement).
(d) Pledgor agrees that it shall not cause ARCC to declare or
make payment of (i) any dividend or other distribution on any shares of its
capital stock, (ii) any payment on account of the purchase, redemption,
retirement or acquisition of (x) any option, warrant or other right to
acquire shares of its capital stock, unless (in each case) at the time of
such declaration or payment (and after giving effect thereto) no amount
payable by ARCC under any Transaction Document with respect to the
Warehousing Series is then due and owing but unpaid.
Section 9. VOTING PROXY. The Pledgor hereby grants to the
Collateral Agent on behalf of Financial Security an irrevocable proxy to vote
the Pledged Shares with respect to the matters contained in Articles III, IX,
XIV, XVI and XVII of each Pledged Entity's certificate of incorporation,
which proxy shall continue, so long as no Insurer Default has occurred and is
continuing, until the occurrence of the last Insurer Termination Date with
respect to any Series. The Pledgor represents and warrants that it has
directed each Pledged Entity, in accordance with Section 217 of the Delaware
Corporation Law, to reflect the Collateral Agent's right to vote the
Collateral, on behalf of Financial Security, on such Pledged Entity's books.
Upon the request of the Collateral Agent or Financial Security, the Pledgor
shall deliver to the Collateral Agent such further evidence of such
irrevocable proxy or such further irrevocable proxy to vote the Collateral as
the Collateral Agent or Financial Security may request. The Collateral Agent
shall exercise all such rights to vote the Collateral granted hereunder in
accordance with the written directions given by Financial Security.
Section 10. RIGHTS OF THE COLLATERAL AGENT AND FINANCIAL
SECURITY. At any time and without notice, Financial Security, so long as no
Insurer Default with respect to any Series has occurred and is continuing,
may, upon providing the Collateral Agent with the full amount necessary to
carry out such direction, direct the Collateral Agent to discharge any taxes,
liens, security interests or other encumbrances levied or placed on the
Collateral, pay for the maintenance and preservation of the Collateral, or
pay for insurance on the Collateral; the amount of such payments, plus any
and all fees, costs and expenses of the Collateral Agent and Financial
Security, (including attorneys' fees and disbursements) in connection
therewith, shall, at the option of the Collateral Agent or Financial
Security, as appropriate, be reimbursed by the Pledgor on demand, with
interest thereon from the date paid at the Late Payment Rate. The Collateral
Agent shall have no duty or obligation to follow any direction provided in
this Section 10,
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unless Financial Security has provided the Collateral Agent with the full
amount necessary to carry out such direction.
Section 11. REMEDIES UPON EVENT OF DEFAULT.
(a) Upon the occurrence of an "Event of Default" under and as
defined in any Insurance Agreement relating to any Series currently
outstanding or issued hereafter, which "Event of Default" is not defined as a
"Portfolio Performance Event of Default" in such Insurance Agreement (a
"Stock Pledge Event") Financial Security, so long as no Insurer Default with
respect to any Series has occurred and is continuing, may, directly or
through the Collateral Agent, without notice to the Pledgor:
(i) cause the Collateral to be transferred to the
Collateral Agent's name or Financial Security's name or in the name of
nominees of either and thereafter exercise as to such Collateral all of the
rights, powers and remedies of an owner;
(ii) collect by legal proceedings or otherwise all
dividends, interest, principal payments, capital distributions and other sums
now or hereafter payable on account of the Collateral, and hold all such sums
as part of the Collateral, or apply such sums to the payment of the
Obligations in such manner and order as Financial Security may decide, in its
sole discretion;
(iii) enter into any extension, subordination,
reorganization, deposit, merger, or consolidation agreement, or any other
agreement relating to or affecting the Collateral, and in connection
therewith deposit or surrender control of the Collateral thereunder, and
accept other property in exchange therefor and hold and apply such property
or money so received in accordance with the provisions hereof; and
(b) In addition to all the rights and remedies of a secured
party under the Uniform Commercial Code, Financial Security, shall have the
right, and without demand of performance or other demand, advertisement or
notice of any kind, except as specified below, to or upon the Pledgor or any
other person (all and each of which demands, advertisements and/or notices
are hereby expressly waived to the extent permitted by law), to proceed
forthwith, or direct the Collateral Agent to proceed forthwith, to collect,
receive, appropriate and realize upon the Collateral, or any part thereof and
to proceed forthwith to sell, assign, give an option or options to purchase,
contract to sell, or otherwise dispose of and deliver the Collateral or any
part thereof in one or more parcels in accordance with applicable securities
laws and in a manner designed to ensure that such sale will not result in a
distribution of the Pledged Shares in violation of Section 5 of the
Securities Act of 1933, as amended and on such terms (including, without
limitation, a requirement that any purchaser of all or any part of the
Collateral shall be required to purchase any securities constituting the
Collateral solely for investment and without any intention to make a
distribution thereof) as Financial Security, in
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its sole and absolute discretion deems appropriate without any liability for
any loss due to decrease in the market value of the Collateral during the
period held. If any notification of intended disposition of the Collateral is
required by law, such notification shall be deemed reasonable and properly
given if mailed to the Pledgor, postage prepaid, at least five (5) days
before any such disposition at the address indicated by their respective
signatures. Any disposition of the Collateral or any part thereof may be for
cash or on credit or for future delivery without assumption of any credit
risk, with the right of Financial Security to purchase all or any part of the
Collateral so sold at any such sale or sales, public or private, free of any
equity or right of redemption in the Pledgor, which right of equity is, to
the extent permitted by applicable law, hereby expressly waived or released
by the Pledgor.
(c) Financial Security, in its sole discretion, may elect to
obtain or cause the Collateral Agent to obtain the advice of any independent
nationally known investment banking firm, which is a member firm of the New
York Stock Exchange, with respect to the method and manner of sale or other
disposition of any of the Collateral, the best price reasonably obtainable
therefor, the consideration of cash and/or credit terms, or any other details
concerning such sale or disposition; costs and expenses of obtaining such
advice shall be for the account of Financial Security. Financial Security,
in its sole discretion, may elect to sell or cause the Collateral Agent to
sell, the Collateral on any credit terms which it deems reasonable; the
out-of-pocket costs and expenses of such sale shall be for the account of
Financial Security. The sale of any of the Collateral on credit terms shall
not relieve the Pledgor of its liability with respect to the Obligations.
All payments received by the Collateral Agent, if any, and Financial Security
in respect of any sale of the Collateral shall be applied to the Obligations
as and when such payments are received.
(d) The Pledgor recognizes that it may not be feasible to
effect a public sale of all or a part of the Collateral by reason of certain
prohibitions contained in the Securities Act, and that it may be necessary to
sell privately to a restricted group of purchasers who will be obliged to
agree, among other things, to acquire the Collateral for their own account,
for investment and not with a view for the distribution or resale thereof.
The Pledgor agrees that private sales may be at prices and other terms less
favorable to the seller than if the Collateral were sold at public sale, and
that neither the Collateral Agent nor Financial Security has any obligation
to delay the sale of any Collateral for the period of time necessary to
permit the registration of the Collateral for public sale under the
Securities Act. The Pledgor agrees that a private sale or sales made under
the foregoing circumstances shall be deemed to have been made in a
commercially reasonable manner.
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(e) If any consent, approval or authorization of any state,
municipal or other governmental department, agency or authority shall be
necessary to effectuate any sale or other disposition of the Collateral, or
any partial disposition of the Collateral, the Pledgor will execute all such
applications and other instruments as may be required in connection with
securing any such consent, approval or authorization, and will otherwise use
its best efforts to secure the same.
(f) Upon any sale or other disposition, the Collateral Agent
acting at the direction of Financial Security or Financial Security shall
have the right to deliver, assign and transfer to the purchaser thereof the
Collateral so sold or disposed of. Each purchaser at any such sale or other
disposition (including Financial Security) shall hold the Collateral free
from any claim or right of whatever kind, including any equity or right of
redemption of the Pledgor. The Pledgor specifically waives, to the extent
permitted by applicable law, all rights of redemption, stay or appraisal
which it may have under any rule of law or statute now existing or hereafter
adopted.
(g) Neither the Collateral Agent nor Financial Security shall
be obligated to make any sale or other disposition of the Collateral, unless
the terms thereof shall be satisfactory to Financial Security. The
Collateral Agent or Financial Security may, without notice or publication,
adjourn any private or public sale, and, upon five (5) days' prior notice to
the Pledgor, hold such sale at any time or place to which the same may be so
adjourned. In case of any sale of all or any part of the Collateral, on
credit or future delivery, the Collateral so sold may be retained by the
Collateral Agent or Financial Security until the selling price is paid by the
purchaser thereof, but neither the Collateral Agent nor Financial Security
shall incur any liability in case of the failure of such purchaser to take up
and pay for the property so sold and, in case of any such failure, such
property may again be sold as herein provided.
(h) All of the rights and remedies granted to the Collateral
Agent and Financial Security, including but not limited to the foregoing,
shall be cumulative and not exclusive and shall be enforceable alternatively,
successively or concurrently as Financial Security may deem expedient.
Section 12. LIMITATION ON LIABILITY.
(a) Neither the Collateral Agent nor Financial Security, nor any
of their respective directors, officers or employees, shall be liable to the
Pledgor or to any Pledged Entity for any action taken or omitted to be taken
by it or them hereunder, or in connection herewith, except that the
Collateral Agent and Financial Security shall each be liable for its own
gross negligence, bad faith or willful misconduct.
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(b) The Collateral Agent shall incur no liability to Financial
Security except for the Collateral Agent's negligence or willful misconduct
in carrying out its duties hereunder.
(c) The Collateral Agent shall be protected and shall incur no
liability to any party in relying upon the accuracy, acting in reliance upon
the contents, and assuming the genuineness of any notice, demand,
certificate, signature, instrument or other document the Collateral Agent
reasonably believes to be genuine and to have been duly executed by the
appropriate signatory, and (absent actual knowledge to the contrary) the
Collateral Agent shall not be required to make any independent investigation
with respect thereto. The Collateral Agent shall at all times be free
independently to establish to its reasonable satisfaction, but shall have no
duty to independently verify, the existence or nonexistence of facts that are
a condition to the exercise or enforcement of any right or remedy hereunder.
(d) The Collateral Agent may consult with qualified counsel,
financial advisors or accountants and shall not be liable for any action
taken or omitted to be taken by it hereunder in good faith and in accordance
with the written advice of such counsel, financial advisors or accountants.
(e) The Collateral Agent shall not be under any obligation to
exercise any of the remedial rights or powers vested in it by this Pledge
Agreement unless it shall have received reasonable security or indemnity
satisfactory to the Collateral Agent against the costs, expenses and
liabilities which it might incur.
Section 13. PERFORMANCE OF DUTIES. The Collateral Agent shall
have no duties or responsibilities except those expressly set forth in this
Pledge Agreement and the Spread Account Agreement, subject to the provisions
of this Pledge Agreement and the Spread Account Agreement, or as directed by
Financial Security in accordance with this Pledge Agreement or the Spread
Account Agreement.
Section 14. APPOINTMENT AND POWERS. Subject to the terms and
conditions hereof, Financial Security appoints Norwest Bank Minnesota,
National Association as its Collateral Agent and Norwest Bank Minnesota,
National Association accepts such appointment and agrees to act as Collateral
Agent on behalf of Financial Security to maintain custody and possession of
the Collateral and to perform the other duties of the Collateral Agent in
accordance with the provisions of this Pledge Agreement. The Collateral
Agent shall, subject to the other terms and provisions of this Pledge
Agreement, act upon and in compliance with Financial Security's written
instructions delivered pursuant to this Pledge Agreement as promptly as
possible following receipt of such written instructions. Receipt of written
instructions shall not be a condition to the exercise by the Collateral Agent
of its express duties hereunder, unless this Pledge Agreement provides that
the
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Collateral Agent is permitted to act only following receipt of such
instructions.
Section 15. SUCCESSOR COLLATERAL AGENT.
(a) MERGER. Any Person into which the Collateral Agent may
be converted or merged, or with which it may be consolidated, or to which it
may sell or transfer its trust business and assets as a whole or
substantially as a whole, or any Person resulting from any such conversion,
merger, consolidation, sale or transfer to which the Collateral Agent is a
party, shall (provided it is otherwise qualified to serve as the Collateral
Agent hereunder) be and become a successor Collateral Agent hereunder and be
vested with all of the title to and interest in the Collateral and all of the
trusts, powers, immunities, privileges and other matters as was its
predecessor without the execution or filing of any instrument or any further
act, deed or conveyance on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
(b) RESIGNATION. The Collateral Agent and any successor
Collateral Agent may resign only (i) with the prior written consent of
Financial Security or (ii) if the Collateral Agent is unable to perform its
duties hereunder as a matter of law as evidenced by an opinion of counsel
acceptable to Financial Security. Upon the occurrence of (i) or (ii) above,
the Collateral Agent shall give notice of its resignation by registered or
certified mail to the Pledgor (with a copy to Financial Security). Any
resignation by the Collateral Agent shall take effect only upon the date
which is the later of (x) the effective date of the appointment by Financial
Security of a successor Collateral Agent and the acceptance in writing by
such successor Collateral Agent of such appointment and (y) the date on which
the Collateral is delivered to the successor Collateral Agent.
Notwithstanding the preceding sentence, if by the contemplated date of
resignation specified in the written notice of resignation delivered (as
described above) no successor Collateral Agent has been appointed Collateral
Agent or becomes the Collateral Agent pursuant to subsection (d) below, the
resigning Collateral Agent may petition a court of competent jurisdiction for
the appointment of a successor.
(c) REMOVAL. The Collateral Agent may be removed by
Financial Security at any time, with or without cause, by an instrument or
concurrent instruments in writing delivered to the Collateral Agent. Any
removal pursuant to the provisions of this subsection (c) shall take effect
only upon the later to occur of (i) the effective date of the appointment of
a successor Collateral Agent and the acceptance in writing by such successor
Collateral Agent of such appointment and of its obligation to perform its
duties hereunder in accordance with the provisions hereof and (ii) the date
on which the Collateral is delivered to the successor Collateral Agent. In
the event of any removal by Financial Security pursuant to this Section
15(c), the Pledgor shall pay the
12
Collateral Agent its fees and expenses then due and owing in accordance with
Section 19 hereof.
(d) APPOINTMENT OF AND ACCEPTANCE BY SUCCESSOR.
(i) Financial Security shall have the sole right to
appoint each successor Collateral Agent. Every successor Collateral Agent
appointed hereunder shall execute, acknowledge and deliver to its predecessor
and to Financial Security and the Pledgor an instrument in writing accepting
such appointment hereunder and the relevant predecessor shall execute,
acknowledge and deliver such other documents and instruments as will
effectuate the delivery of all Collateral to the successor Collateral Agent,
whereupon such successor, without any further act, deed or conveyance, shall
become fully vested with all the estates, properties, rights, powers, duties
and obligations of its predecessor. Such predecessor shall, nevertheless, on
the written request of Financial Security, execute and deliver an instrument
transferring to such successor all the estates, properties, rights and powers
of such predecessor hereunder.
(ii) Every predecessor Collateral Agent shall
assign, transfer and deliver all Collateral held by it as Collateral Agent
hereunder to its successor as Collateral Agent.
(iii) Should any instrument in writing from the
Pledgor or any Pledged Entity be reasonably required by a successor
Collateral Agent for more fully and certainly vesting in such successor the
estates, properties, rights, powers, duties and obligations vested or
intended to be vested hereunder in the Collateral Agent, any and all such
written instruments shall, at the request of the successor Collateral Agent,
be forthwith executed, acknowledged and delivered by the Pledgor or such
Subsidiary, as the case may be.
(iv) The designation of any successor Collateral
Agent and the instrument or instruments removing any Collateral Agent and
appointing a successor hereunder, together with all other instruments
provided for herein, shall be maintained with the records relating to the
Collateral and, to the extent required by applicable law, filed or recorded
by the successor Collateral Agent in each place where such filing or
recording is necessary to effect the transfer of the Collateral to the
successor Collateral Agent or to protect and preserve the security interests
granted hereunder.
Section 16. INDEMNIFICATION. The Pledgor shall indemnify the
Collateral Agent, its directors, officers, employees and its agents for, and
hold the Collateral Agent, its directors, officers, employees and its agents
harmless against, any loss, liability or expense (including the costs and
expenses of defending against any claim of liability) arising out of or in
connection with the Collateral Agent's acting as Collateral Agent hereunder,
except such loss, liability or expense as shall result from the
13
negligence, bad faith or willful misconduct of the Collateral Agent or its
directors, officers, employees or agents. The obligation of the Pledgor
under this Section shall survive the termination of this Agreement and the
resignation or removal of the Collateral Agent.
Section 17. REPRESENTATIONS AND WARRANTIES OF THE COLLATERAL
AGENT. The Collateral Agent represents and warrants to Pledgor and to
Financial Security as follows:
(a) DUE ORGANIZATION. The Collateral Agent is a national
banking association, duly organized, validly existing and in good standing
under the laws of the United States and is duly authorized and licensed under
applicable law to conduct its business as presently conducted.
(b) CORPORATE POWER. The Collateral Agent has all requisite
right, power and authority to execute and deliver this Pledge Agreement and
the other Documents to which it is a party and to perform all of its duties
as Collateral Agent hereunder and thereunder.
(c) DUE AUTHORIZATION. The execution and delivery by the
Collateral Agent of this Pledge Agreement and the other Transaction Documents
to which it is a party, and the performance by the Collateral Agent of its
duties hereunder and thereunder, have been duly authorized by all necessary
corporate proceedings and no further approvals or filings, including any
governmental approvals, are required for the valid execution and delivery by
the Collateral Agent, or the performance by the Collateral Agent, of this
Pledge Agreement and such other Transaction Documents.
(d) VALID AND BINDING AGREEMENTS. The Collateral Agent has
duly executed and delivered this Pledge Agreement and each other Transaction
Document to which it is a party, and each of this Pledge Agreement and each
such other Transaction Document constitutes the legal, valid and binding
obligation of the Collateral Agent, enforceable against the Collateral Agent
in accordance with its terms, except as (i) such enforceability may be
limited by bankruptcy, insolvency, reorganization and similar laws relating
to or affecting the enforcement of creditors' rights generally and (ii)
rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability.
Section 18. TERMINATION. This Pledge Agreement shall continue
in full force and effect until the date which is the last Insurer Termination
Date with respect to any Series. Subject to any sale or other disposition by
the Collateral Agent or Financial Security of the Collateral or any part
thereof pursuant to and in accordance with this Pledge Agreement, the
Collateral shall be returned to the Pledgor on the date which is the last
Insurer Termination Date with respect to any Series.
14
Section 19. COMPENSATION AND REIMBURSEMENT. The Pledgor agrees
for the benefit of Financial Security and as part of the Insurer Secured
Obligations (a) to pay to the Collateral Agent, from time to time, reasonable
compensation for all services rendered by it hereunder; and (b) to reimburse
the Collateral Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Collateral Agent in
accordance with any provision of, or carrying out its duties and obligations
under, this Agreement (including the reasonable compensation and fees and the
expenses and disbursements of its agents, any independent certified public
accountants and independent counsel), except any expense, disbursement or
advances as may be attributable to negligence, bad faith or willful
misconduct on the part of the Collateral Agent.
Section 20. FORECLOSURE EXPENSES OF THE COLLATERAL AGENT AND
FINANCIAL SECURITY. All expenses (including reasonable fees and
disbursements of counsel) incurred by the Collateral Agent or Financial
Security in connection with any actual or attempted sale, exchange of, or any
enforcement, collection, compromise or settlement respecting, this Agreement
or the Collateral, or any other action taken by Financial Security hereunder
whether directly or as attorney-in-fact pursuant to a power of attorney or
other authorization herein conferred, for the purpose of satisfaction of the
Obligations shall be deemed an Obligation for all purposes of this Pledge
Agreement, and an Insurer Secured Obligation for all purposes of the Spread
Account Agreement, and the Collateral Agent (with the consent of Financial
Security) and Financial Security may apply the Collateral to payment of or
reimbursement of itself for such liability.
Section 21. NOTICES. Any notice or other communication given
hereunder shall be in writing and shall be sent by registered mail, postage
prepaid, or personally delivered or telecopied to the recipient as follows:
(a) To the Collateral Agent:
Norwest Bank Minnesota, National Association
Xxxxxxx Xxxxxx
Xxxxx Xxxxxx & Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000
Attention: Corporate Trust Department
Telecopy No.: (000) 000-0000
(b) To Financial Security:
Financial Security Assurance Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Surveillance Department
Confirmation: (000) 000-0000
Telecopy Nos.: (000) 000-0000
(000) 000-0000
15
(c) To the Pledgor:
Olympic Financial Ltd.
Olympic Place
0000 Xxxxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000-0000
Attention: Treasurer
Confirmation: (000) 000-0000
Telecopy No: (000) 000-0000
Section 22. GENERAL PROVISIONS.
(a) The Collateral Agent on behalf of Financial Security and
its successors and assigns shall have no obligation in respect of the
Collateral, except to use reasonable care in holding the Collateral and to
hold and dispose of the same in accordance with the terms of this Pledge
Agreement.
(b) The failure of the Collateral Agent or Financial Security
to exercise, or delay in exercising, any right, power or remedy hereunder,
shall not operate as a waiver thereof, nor shall any single or partial
exercise by the Collateral Agent or Financial Security of any right, power or
remedy hereunder preclude any other or future exercise thereof, or the
exercise of any other right, power or remedy. The remedies herein provided
are cumulative and are not exclusive of any remedies provided by law or any
other agreement.
(c) The representations, covenants and agreements of the
Pledgor herein contained shall survive the date hereof.
(d) Neither this Pledge Agreement nor the provisions hereof
can be changed, waived or terminated orally. This Pledge Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors, legal representatives and assigns. If any provision
of this Pledge Agreement shall be invalid or unenforceable in any respect or
in any jurisdiction, the remaining provisions shall remain in full force and
effect and shall be enforceable to the maximum extent permitted by law.
(e) This Pledge Agreement may be executed in counterparts.
(f) EACH OF THE PARTIES HERETO WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION ARISING DIRECTLY OR INDIRECTLY OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREUNDER OR
THEREUNDER. EACH OF THE PARTIES HERETO (I) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE
THE FOREGOING WAIVER AND (II) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER
INTO THIS
16
AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY, BY
AMONG OTHER THINGS, THIS WAIVER.
(g) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(h) The Pledgor irrevocably submits to the jurisdiction of
the United States District Court for the Southern District of New York, any
court in the State of New York located in the city and county of New York,
and any appellate court from any thereof, in any action, suit or proceeding
brought against it and related to or in connection with this Agreement, the
other Transaction Documents or the transactions contemplated hereunder or
thereunder or for recognition or enforcement of any judgment and each of the
parties hereto irrevocably and unconditionally agrees that all claims in
respect of any such suit or action or proceeding may be heard or determined
in such New York State court or, to the extent permitted by law, in such
federal court. Each of the parties hereto agrees that a final judgment in
any such action, suit or proceeding shall be conclusive and may be enforced
in other jurisdictions by suit on the judgment or in any other manner
provided by law. To the extent permitted by applicable law, each of the
parties hereby waives and agrees not to assert by way of motion, as a defense
or otherwise in any such suit, action or proceeding, any claim that is not
personally subject to the jurisdiction of such courts, that the suit, action
or proceeding is brought in an inconvenient forum, that the venue of the
suit, action or proceeding is improper or that this Agreement or any of the
other Transaction Documents or the subject matter hereof or thereof may not
be litigated in or by such courts. The Pledgor irrevocably appoints and
designates CT Corporation System, whose address is 0000 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, as its true and lawful attorney and duly authorized agent for
acceptance of service of legal process. The Pledgor agrees that service of
such process upon such Person shall constitute personal service of such
process upon it. Nothing contained in this Agreement shall limit or affect
the rights of any party hereto to serve process in any other manner permitted
by law or to start legal proceedings related to any of the Transaction
Documents against the Pledgor or its respective property in the courts of any
jurisdiction.
17
SCHEDULE A
PLEDGED SHARES
Certificate No. 1, 100 Shares of the Common Stock of Olympic Receivables
Finance Corp.
Certificate No. 1, 100 Shares of the Common Stock of Olympic First GP Inc.
Certificate No. 1, 100 Shares of the Common Stock of Olympic Second GP Inc.
Certificate No. 1, 100 Shares of the Common Stock of ARCC
(i) the Collateral Agent, by the execution hereof, acknowledges receipt
of the Pledged Shares on behalf of Financial Security.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Pledge Agreement on the date first above written.
OLYMPIC FINANCIAL LTD.
By: [Illegible]
----------------------------------
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Collateral Agent
By: ----------------------------------
Name:
Title:
FINANCIAL SECURITY ASSURANCE INC.
By: ---------------------------------
Name:
Title:
(i) The Collateral Agent, by the execution hereof, acknowledges receipt
of the Pledged Shares on behalf of Financial Security.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Pledge Agreement on the date first above written.
OLYMPIC FINANCIAL LTD.
By:________________________________
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
as Collateral Agent
By: [Illegible]
________________________________
Name:
Title:
FINANCIAL SECURITY ASSURANCE, INC.
By:________________________________
Name:
Title:
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
OLYMPIC AUTOMOBILE RECEIVABLES
WAREHOUSE TRUST,
as Seller
By: Wilmington Trust Company,
not in its individual
capacity but solely as
Owner Trustee
By:_________________________________
Name:
Title:
OLYMPIC FINANCIAL LTD.
By:__________________________________
Name:
Title: Treasurer
DELAWARE FUNDING CORPORATION,
as Purchaser
By: Xxxxxx Guaranty Trust
Company of New York,
as attorney-in-fact for
Delaware Funding Corporation
By: XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Vice President
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK
as Administrative Agent
By: XXXXXXX X. XXXXX
Name: Xxxxxxx X. Xxxxx
Title: Vice President
PLEASE SEE RESTRICTIVE LEGEND ON REVERSE SIDE HEREOF
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
NUMBER SHARES
1 100
ARCADIA RECEIVABLES CONDUIT CORP.
This Certifies that OLYMPIC FINANCIAL LTD. is the owner and
registered holder of ONE HUNDRED (100) Shares of
fully paid and nonassessable Common Stock, $.01 par value, of
ARCADIA RECEIVABLES CONDUIT CORP.
transferable only on the books of the corporation by the holder hereof in
person or by duly authorized attorney upon surrender of this certificate
properly endorsed.
IN WITNESS WHEREOF, the said corporation has caused this certificate to
be signed by its duly authorized officers and to be sealed with the seal
of the corporation.
this 2ND day of December, 1996
[Illegible] [Illegible]
_____________________________ __________________________________
Secretary President
SEAL
The shares represented by this
certificate have not been registered
or qualified under the Securities Act
of 1933, as amended, or any state
securities laws. Such shares of stock
may not be sold, transferred or
otherwise disposed of without either
(i) an opinion of counsel
satisfactory to the corporation that
such transfer may lawfully be made
without registration or qualification
under the federal Securities Act of
1933, as amended, and all applicable
state securities laws; or (ii) such
registration or qualification.
For Value Received _________ hereby sell, assign and transfer unto
__________________________________________________________________
___________________________________________________________ Shares
represented by the within Certificate, and do hereby irrevocably
constitute and appoint
_________________________________________________________ Attorney
to transfer the said shares on the Books of the within named
Corporation with full power of substitution in the premises.
Dated ___________________, 19 ____________________________________
IN PRESENCE OF ____________________________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME AS WRITTEN
UPON THE FACE OF THIS CERTIFICATE IN
EVERY PARTICULAR, WITHOUT ALTERATION OR
ENLARGEMENT OR ANY CHANGE WHATEVER.
4B-Stock Power
For Value Received, Olympic Financial Ltd. does hereby transfer unto
____________________________________, One hunded (100) shares of the common
stock, $.01 par value, of Arcadia Receivables Conduit Corp., a Delaware
corporation, standing in the name on the books of the corporation and
represented by Stock Certificate Number _________________ and does hereby
irrevocably constitute and appoint its attorney-in-fact to transfer the said
stock on the books of the corporation with full power of substitution in the
premises.
OLYMPIC FINANCIAL LTD.
Dated:_____________________ By: [Illegible]
______________________________
Its:______________________________
