RECEIVABLES FINANCING AGREEMENT
dated as of September 24, 1998
among
ARCADIA RECEIVABLES FINANCE CORP. IV,
as Borrower
ARCADIA FINANCIAL LTD.,
as Servicer and Custodian,
THE LENDERS PARTIES HERETO,
CREDIT SUISSE FIRST BOSTON, NEW YORK BRANCH,
as Agent,
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
as Backup Servicer and Collateral Agent
RECEIVABLES FINANCING AGREEMENT
THIS RECEIVABLES FINANCING AGREEMENT is made and entered into as
of September 24, 1998, among ARCADIA RECEIVABLES FINANCE CORP. IV, a
Delaware corporation having its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ (the
"BORROWER"), ARCADIA FINANCIAL, LTD., a Minnesota corporation having its
principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ("AFL"), as initial Servicer and Custodian, the
NONCOMMITTED LENDER (as hereinafter defined) party hereto, THE FINANCIAL
INSTITUTIONS SET FORTH ON THE SIGNATURE PAGES HERETO and their permitted
assigns, as committed lenders (the "BANKS" and, together with the
Noncommitted Lender, the "LENDERS"), CREDIT SUISSE FIRST BOSTON, NEW YORK
BRANCH ("CSFB"), as agent (the "AGENT") for the Lenders, and NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, a national banking association
("NORWEST"), as Backup Servicer and Collateral Agent.
BACKGROUND
1. The Borrower desires that the Lenders extend financing to
the Borrower on the terms and conditions set forth herein.
2. The Lenders are willing to provide such financing on the
terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINED TERMS. As used in this Agreement, the
following terms have the following meanings:
"ACCOUNTANTS' REPORT" has the meaning set forth in SECTION
8.11(a).
"ADVANCE" means any amount disbursed by any Lender to the Borrower
under this Agreement.
"ADVANCE DATE" means the date any Advance is made under
SECTION 2.3.
"ADVANCE REQUEST" has the meaning set forth in SECTION 2.2.
"ADVERSE CLAIM" means any claim of ownership or any Lien, title
retention, trust or other charge or encumbrance, or other type of
preferential arrangement having the effect or
purpose of creating a Lien, other than the security interest created
under this Agreement.
"AFFECTED PERSON" has the meaning set forth in SECTION 6.1(a).
"AFFILIATE" of any Person means any other Person that directly or
indirectly controls, is controlled by or is under common control with
such Person (excluding any trustee under, or any committee with
responsibility for administering, any employee benefit plan). A Person
shall be deemed to be "controlled by" any other Person if such other
Person controls such Person within the meaning of Section 15 of the
Securities Act of 1933, as amended, or Section 20 of the Securities
Exchange Act of 1934, as amended.
"AFL" has the meaning set forth in the PREAMBLE.
"AGENT" has the meaning set forth in the PREAMBLE.
"AGENT'S ACCOUNT" has the meaning set forth in SECTION 5.1.
"AGGREGATE OUTSTANDING PRINCIPAL BALANCE" means, with respect to
any group of Receivables as of any date, the sum of the outstanding
Principal Balances of all such Receivables as at the opening of business
on such date.
"AGREEMENT" shall mean this Receivables Financing Agreement
(including the Fee Letter and the Joinder Supplement hereto), as it may
be amended, supplemented or otherwise modified from time to time.
"ALLOCATIONS" has the meaning set forth in SECTION 3.3(a).
"ALTERNATE BASE RATE" means a fluctuating rate per annum as shall
be in effect from time to time, which rate shall be at all times equal to
the highest of:
(a) the rate of interest announced publicly by CSFB in New
York, New York, from time to time as CSFB's base commercial lending rate;
(b) 1/2 of one percent above the latest three-week moving
average of secondary market morning offering rates in the United States for
three-month certificates of deposit of major United States money market banks,
such three-week moving average being determined weekly on each Monday (or, if
such day is not a Business Day, on the next succeeding Business Day) for the
three-week period ending on the previous Friday by CSFB on the basis of such
rates reported by certificate of deposit dealers to and published by the Federal
Reserve Bank of New York or, if such publication shall be suspended or
terminated, on the basis of quotations for such rates received by CSFB from
three New York, New York certificate of deposit dealers of recognized standing
selected by CSFB, in either case adjusted to the nearest 1/4 of one percent or,
if there is no nearest 1/4 of one percent, to the next higher 1/4 of one
percent; and
(c) 1/2 of one percent above the Federal Funds Rate.
"AMOUNT FINANCED" means, with respect to a Receivable, the
aggregate amount of credit extended under such Receivable toward the
purchase price of the Financed Vehicle and related costs, including
amounts advanced in respect of accessories, insurance premiums, service
and warranty contracts, other items customarily financed as part of
retail automobile installment sale contracts or promissory notes, and
related costs.
"ANNUAL PERCENTAGE RATE" or "APR" means, with respect to a
Receivable, the rate per annum of finance charges stated in such
Receivable as the "annual percentage rate" (within the meaning of the
Federal Truth-in-Lending Act). If, after the applicable Purchase Date,
the rate per annum with respect to a Receivable as of such Purchase Date
is reduced as a result of (a) an insolvency proceeding involving the
relevant Obligor or (b) pursuant to the Soldiers' and Sailors' Civil
Relief Act of 1940, the "Annual Percentage Rate" or "APR" shall refer to
such reduced rate.
"AVERAGE SERVICING PORTFOLIO" means as of any date, the average of
the Servicing Portfolio for the six preceding Collection Periods.
"BACKUP SERVICER" means Norwest in its capacity as Backup
Servicer, together with its permitted successors and assigns in such
capacity .
"BACKUP SERVICER FEE" means, for any Distribution Date, the amount
payable to the Backup Servicer as its regular fee on such Distribution
Date pursuant to the Norwest Fee Letter.
"BACKUP SERVICING FEE RATE" has the meaning set forth in the
Norwest Fee Letter.
"BANK RATE" for any Advance means a rate per annum equal to 1.00%
per annum above the Eurodollar Rate for each Advance or portion thereof;
PROVIDED, HOWEVER, that in the case of
(a) any Fixed Period on or prior to the first day of which a Bank
shall have notified the Agent that the introduction of or any change in or in
the interpretation of any law or regulation makes it unlawful, or any central
bank or other governmental authority asserts that it is unlawful, for such Bank
to fund such Advance at the Bank Rate set forth above (and such Bank shall not
have subsequently notified the Agent that such circumstances no longer exist),
(b) any Fixed Period of one to (and including) 29 days, in the event
the Eurodollar Rate is not reasonably available to the Agent for such a Fixed
Period,
(c) any Fixed Period as to which the related Advance will not be
funded by issuance of commercial paper, as determined by the Agent (on behalf of
the Noncommitted Lender) by 12:00 noon (New York City time) on the second
Business Day preceding the first day of such Fixed Period, or
(d) any Fixed Period for an Advance the principal amount of which
allocated to the
Banks in the aggregate is less than $500,000,
the "BANK RATE" shall be a floating rate per annum equal to the Alternate
Base Rate in effect on each day of such Fixed Period; PROVIDED, FURTHER,
that the Agent (with the consent of the Lenders) and the Borrower may
agree in writing from time to time upon a different "BANK RATE."
"BANK RATE ALLOCATION" has the meaning set forth in SECTION
3.3(a).
"BANKRUPTCY CODE" means the Bankruptcy Code, 11 U.S.C. Section
101, ET SEQ., as amended.
"BANKS" has the meaning set forth in the PREAMBLE.
"BORROWER" has the meaning set forth in the PREAMBLE.
"BORROWER ACCOUNT COLLATERAL" has the meaning set forth in SECTION
9.1(c).
"BORROWER ASSIGNED AGREEMENTS" has the meaning set forth in
SECTION 9.1(b).
"BORROWING BASE" means the excess of (a) (i) if determined on any
day during a Collection Period occurring prior to the Distribution Date
occurring during such Collection Period, an amount equal to (A) with
respect to all Transferred Receivables which are Eligible Receivables on
such day of determination that were purchased by the Borrower prior to
the first day of the Collection Period immediately preceding such
Distribution Date, an amount equal to the Aggregate Outstanding Principal
Balance of all such Eligible Receivables as of the last day of the second
Collection Period preceding such Distribution Date (whether or not such
Receivables were owned by the Borrower on such last day), PLUS (B) with
respect to all Transferred Receivables which are Eligible Receivables on
such day of determination that were purchased by the Borrower on or after
the first day of the Collection Period immediately preceding such
Distribution Date, an amount equal to the Aggregate Outstanding Principal
Balance of such Eligible Receivables as of the date such Transferred
Receivables were purchased by the Borrower, PLUS (C) the amount on
deposit in the Collateral Account on such day; or (ii) if determined on
any day during a Collection Period occurring on or after the Distribution
Date occurring during such Collection Period, an amount equal to (A) with
respect to all Transferred Receivables which are Eligible Receivables on
such day of determination that were purchased by the Borrower prior to
the first day of such Collection Period, an amount equal to the Aggregate
Outstanding Principal Balance of all such Eligible Receivables as of the
last day of the Collection Period immediately preceding such Distribution
Date PLUS (B) with respect to all Transferred Receivables which are
Eligible Receivables on such day of determination that were purchased by
the Borrower on or after the first day of such Collection Period, an
amount equal to the Aggregate Outstanding Principal Balance of such
Eligible Receivables as of the date such Transferred Receivables were
purchased by the Borrower, PLUS (C) the amount on deposit in the
Collateral Account on such day OVER (b) the Required Holdback as of such
date.
"BORROWING BASE CONFIRMATION" has the meaning set forth in
SECTION 7.2(g).
"BORROWING BASE DEFICIENCY" has the meaning set forth in SECTION
14.1(e).
"BORROWER COLLATERAL" has the meaning set forth in SECTION 9.1.
"BUSINESS DAY" shall mean any day on which (a) commercial banks in
New York City or Minneapolis, Minnesota are not authorized or required to
be closed, and (b) in the case of a Business Day which relates to a
Eurodollar Advance, dealings are carried on in the London interbank
Eurodollar market.
"CLEAN-UP PERIOD" shall mean the period commencing on the date of
the initial Advance hereunder and ending on SEPTEMBER 23, 1999 and
thereafter, each period commencing on the last day of the preceding
Clean-Up Period and ending 364 days thereafter.
"CLEAN-UP REQUIREMENT" means the obligation of the Borrower to
reduce to zero the outstanding principal amount of all Advances for 30
consecutive days during each Clean-Up Period.
"CLOSING DATE" means the Effective Date.
"COLLATERAL" means the Transferred Receivables in the Total
Receivables Pool together with the Other Conveyed Property.
"COLLATERAL ACCOUNT" means the account designated as the
Collateral Account in, and which is established and maintained pursuant
to, SECTION 8.17(c).
"COLLATERAL AGENT" means Norwest in its capacity as Collateral
Agent under the Collateral Agent Agreement, and its permitted successors
and assigns in such capacity.
"COLLATERAL AGENT AGREEMENT" means the Collateral Agent Agreement
dated as of the date hereof among the Collateral Agent, the Agent, AFL
and the Borrower, including all amendments, modifications and supplements
thereto.
"COLLATERAL AGENT FEE" means, for any Distribution Date, the
amount payable to the Collateral Agent as its regular fee on such
Distribution Date pursuant to the Norwest Fee Letter.
"COLLATERAL AGENT FEE RATE" has the meaning set forth in the
Norwest Fee Letter.
"COLLATERAL INSURANCE" means a vendor's single interest or other
collateral protection insurance policy with respect to Financed Vehicles,
which policy by its terms insures against physical damage in the event
any Obligor fails to maintain physical damage insurance with respect to
the related Financed Vehicle.
"COLLATERAL RECEIPT" means a Certificate of Custodian in the form
of EXHIBIT A to the Custodial Agreement.
"COLLECTED FUNDS" means, with respect to any Determination Date,
the amount of funds in the Collection Account representing collections on
the Total Receivables Pool during the related Collection Period,
including all Recoveries with respect thereto collected during the
related Collection Period (but excluding any Purchase Amounts).
"COLLECTION ACCOUNT" means the account designated as the
Collection Account in, and which is established and maintained pursuant
to, SECTION 8.17(a).
"COLLECTION PERIOD" means any calendar month and, with respect to
a Determination Date or a Distribution Date, the calendar month preceding
the month in which such Determination Date or Distribution Date occurs
(such calendar month being referred to as the "related" Collection Period
with respect to such Determination Date or Distribution Date) or, in the
case of the initial Distribution Date and Determination Date, the period
commencing at the opening of business on the Closing Date and ending at
the end of the calendar month following the calendar month in which the
Closing Date occurs. Any amount stated "as of the close of business of
the last day of a Collection Period" shall give effect to the following
calculations as determined as of the end of the day on such last day:
(i) all applications of collections, and (ii) all distributions.
"COLLECTION RECORDS" means all manually prepared or computer
generated records relating to collection efforts or payment histories
with respect to the Transferred Receivables.
"COMMERCIAL PAPER RATE" for Advances means, to the extent the
Noncommitted Lender funds such Advances by issuing commercial paper, the
sum of (a) the weighted average of the rates at which commercial paper
notes of such Noncommitted Lender issued to fund such Advances may be
sold by any placement agent or commercial paper dealer selected by the
Agent on behalf of such Noncommitted Lender, as agreed in good faith
between each such agent or dealer and the Agent; PROVIDED if the rate (or
rates) as agreed between any such agent or dealer and the Agent is a
discount rate (or rates), then such rate shall be the rate (or if more
than one rate, the weighted average of the rates) resulting from
converting such discount rate (or rates) to an interest-bearing
equivalent rate per annum PLUS (b) any and all commissions of placement
agents and commercial paper dealers in respect of commercial paper issued
to fund the making or maintenance of any Advance not to exceed an
annualized rate of .05% of the Face Amount of such commercial paper PLUS
(c) any and all reasonable costs and expenses of any issuing and paying
agent or other Person responsible for the administration of such
Noncommitted Lender's commercial paper program in connection with the
preparation, completion, issuance, delivery or payment of commercial
paper issued to fund the making or maintenance of any Advance.
"COMMITMENT" means, for any Bank, the maximum amount of such
Bank's commitment to fund Advances hereunder, as set forth on the
signature pages hereof or in assignment documentation by which such Bank
became a party to this Agreement or assumed the Commitment (or a portion
thereof) of another Bank, as such amount may be
adjusted from time to time pursuant to SECTION 2.7 or pursuant to
assignment documentation executed by such Bank and its assignee and
delivered pursuant to SECTION 16.2 of this Agreement.
"COMMITMENT PERCENTAGE" means, for a Bank, such Bank's Commitment
as a percentage of the aggregate Commitments of all Banks.
"COMMITMENT TERMINATION DATE" means September 23, 1999, as such
date may be extended from time to time as agreed in writing between the
Borrower, the Servicer, the Agent and the Lenders.
"CONTINGENT LIABILITY" means any agreement, undertaking or
arrangement by which any Person guarantees, endorses or otherwise becomes
or is contingently liable upon (by direct or indirect agreement,
contingent or otherwise, to provide funds for payment, to supply funds
to, or otherwise to invest in, a debtor, or otherwise to assure a
creditor against loss) the indebtedness, obligation or any other
liability of any other Person (other than by endorsements of instruments
in the course of collection), or guarantees the payment of dividends or
other distributions upon the shares of any other Person. The amount of
any Person's obligation under any Contingent Liability shall (subject to
any limitation set forth therein) be deemed to be the outstanding
principal amount (or maximum outstanding principal amount, if larger) of
the debt, obligation or other liability guaranteed thereby.
"CP ALLOCATION" has the meaning set forth in SECTION 3.3(a).
"CRAM DOWN LOSS" means, with respect to a Receivable, if a court
of appropriate jurisdiction in an insolvency proceeding shall have issued
an order reducing the amount owed on such Receivable or otherwise
modifying or restructuring the scheduled payments to be made on such
Receivable, an amount equal to the excess of the principal balance of
such Receivable immediately prior to such order, minus the principal
balance of such Receivable as so reduced. A "Cram Down Loss" shall be
deemed to have occurred on the date of issuance of such order.
"CSFB" has the meaning set forth in the PREAMBLE.
"CSFB ROLES" has the meaning set forth in SECTION 18.11.
"CUSTODIAL AGREEMENT" means the Custodian Agreement dated as of
the date hereof among the Custodian, the Agent, the Borrower and the
Collateral Agent, including all permitted amendments, modifications and
supplements thereto.
"CUSTODIAL FEE RATE" means (a) if AFL is the Custodian, 0% and
(b) if a Person other than AFL is the Custodian, a rate agreed to by such
Person and the Agent.
"CUSTODIAN" means AFL in its capacity as Custodian under the
Custodial Agreement, and its permitted successors and assigns in such
capacity.
"DEALER" means a seller of new or used automobiles, light duty
trucks, minivans or
sport utility vehicles that originated one or more of the Receivables in
the Total Receivables Pool and sold the respective Receivable, directly
or indirectly, to AFL.
"DEALER AGREEMENT" means an agreement by and among AFL and a
Dealer relating to the sale of Receivables to AFL and all documents and
instruments relating thereto.
"DEALER ASSIGNMENT" means, with respect to a Transferred
Receivable, the executed assignment executed by a Dealer conveying such
Receivable to AFL.
"DEALER UNDERWRITING GUIDES" means, collectively, the underwriting
guidelines used by AFL in the purchase of Receivables as amended from
time to time.
"DEFAULT RATE" means a rate PER ANNUM equal to the Alternate Base
Rate (but not less than the Yield (if any) in effect for the related
monetary obligation), PLUS a margin of 2%.
"DEFAULTED RECEIVABLE" means, with respect to a Transferred
Receivable as of any date, a Receivable with respect to which (i) all or
any portion in excess of $10 of a Scheduled Payment is more than 60 days
past due, (ii) the Servicer has repossessed the related Financed Vehicle
(and any applicable redemption period has expired), (iii) the Obligor has
been identified in the records of the Servicer as being the subject of a
current bankruptcy proceeding or (iv) such Receivable is in default and
the Servicer has charged-off such Receivable in accordance with its
standard policies or otherwise has determined in good faith that payments
thereunder are not likely to be resumed.
"DEFICIENCY AMOUNT" means, as of any date, an amount equal to the
product of (x) the Deficiency Percentage, (y) the Aggregate Outstanding
Principal Balance of Eligible Receivables as of such date and (z) 2.0.
"DEFICIENCY PERCENTAGE" means, as of any date, the positive
excess, if any, of (a) the sum of (i) 8.3% PLUS (ii) the Total Expense
Percentage PLUS (iii) the Maximum Interest Rate Cap Strike Price PLUS
(iv) 0.75%, OVER (b) the weighted average APR for all Receivables in the
Total Receivables Pool.
"DELINQUENCY RATIO" means, as of any date, the ratio (expressed as
a percentage) computed by dividing:
(a) the sum of (i) the Aggregate Outstanding Principal
Balance of Receivables in the Total Receivables Pool which became Defaulted
Receivables during the last full Collection Period preceding such date PLUS (ii)
the Aggregate Outstanding Principal Balance of Receivables in the Total
Receivables Pool which were Delinquent Receivables on the last day of the
immediately preceding Collection Period
BY
(b) the sum of the Aggregate Outstanding Principal
Balance of all Receivables in the Total Receivables Pool on the last day of the
immediately preceding
Collection Period PLUS, without duplication, if a Take-Out Securitization has
occurred during such preceding Collection Period, the Aggregate Outstanding
Principal Balance of all Transferred Receivables which were included in such
Take-Out Securitization.
The Delinquency Ratio shall be determined on each Determination Date and
shall remain in effect until recalculated on the next succeeding
Determination Date.
"DELINQUENT RECEIVABLE" means a Receivable (other than a Defaulted
Receivable) with respect to which more than $10 of a Scheduled Payment is
more than 30 days past due.
"DETERMINATION DATE" means, with respect to a Collection Period,
the FOURTH Business Day prior to the related Distribution Date.
"DISTRIBUTION DATE" means the 15th day of each calendar month, or
if such 15th day is not a Business Day, the next succeeding Business Day,
commencing October 15, 1998.
"DOLLAR(S)" and the sign "$" mean lawful money of the United
States of America.
"EFFECTIVE DATE" has the meaning set forth in SECTION 7.1.
"ELIGIBLE ACCOUNT" means (i) a segregated trust account or (ii) a
segregated direct deposit account, in each case, maintained with a
depository institution or trust company organized under the laws of the
United States of America, or any of the States thereof, or the District
of Columbia, having a certificate of deposit, short term deposit or
commercial paper rating of at least A-1+ by Standard & Poor's and P-1 by
Moody's. In either case, such depository institution or trust company
shall either (x) be Norwest or (y) have been approved by the Agent,
acting in its discretion, by written notice to the Servicer.
"ELIGIBLE ASSIGNEE" has the meaning set forth in SECTION 16.1.
"ELIGIBLE RECEIVABLE" means a Receivable that (i) was originated
directly by AFL with the consumer or was originated by a Dealer for the
retail sale of a Financed Vehicle in the ordinary course of such Dealer's
business and such Dealer had all necessary licenses and permits to
originate Receivables in the state where such Dealer was located, was
fully and properly executed by the parties thereto, was purchased by AFL
from such Dealer under a Dealer Agreement with AFL and was validly
assigned by such Dealer to AFL, (ii) contains customary and enforceable
provisions such as to render the rights and remedies of the holder
thereof adequate for realization against the collateral security, and
(iii) is a Simple Interest Receivable or Pre-Computed Receivable which
provides for level monthly payments (PROVIDED that the payment in the
first monthly period and the final monthly period of the life of the
Receivable may be minimally different from the level payment) which, if
made when due, shall fully amortize the Amount Financed over the original
term; and
(a) that is a Dollar obligation of an Obligor domiciled in the United
States of America and that was originated and, if originated by a Dealer, that
was sold by the Dealer to AFL, without any fraud or material misrepresentation
on the part of such originator or Dealer in either
case or on the part of the Obligor;
(b) with respect to which all requirements of applicable federal,
state and local laws, and regulations thereunder (including, without limitation,
usury laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity Act,
the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt
Collection Practices Act, the Federal Trade Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇
Warranty Act, the Federal Reserve Board's Regulations "B" and "Z", the Soldiers'
and Sailors' Civil Relief Act of 1940, the Minnesota Motor Financed Vehicle
Retail Installment Sales Act, and state adaptations of the National Consumer Act
and of the Uniform Consumer Credit Code and other consumer credit laws and equal
credit opportunity and disclosure laws), in respect of such Receivable, the sale
of the Financed Vehicle related thereto and the sale of credit life and credit
accident and health insurance and any extended service contracts, if any, in
connection with such Receivable, have been complied with in all material
respects;
(c) that was originated in the United States of America and, at the
time of origination, materially conformed to all requirements of the Dealer
Underwriting Guides applicable to such Receivable;
(d) which represents the genuine, legal, valid and binding payment
obligation of the Obligor thereon, enforceable by the holder thereof in
accordance with its terms, except (A) as enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally and by equitable limitations on
the availability of specific remedies, regardless of whether such
enforceability is considered in a proceeding in equity or at law and (B) as
such Receivable may be modified by the application of the Soldiers' and
Sailors' Civil Relief Act of 1940, as amended; and all parties to such
Receivable had full legal capacity to execute and deliver such Receivable and
all other documents related thereto and to grant the security interest
purported to be granted thereby;
(e) which is not due from the United States of America or any State or
from any agency, department, subdivision or instrumentality thereof;
(f) which (i) as of the related Advance Date, (A) had an original
maturity of at least 6 months but not more than 84 months, PROVIDED that, after
giving effect to the inclusion of such RECEIVABLE as an Eligible Receivable, the
Aggregate Outstanding Principal Balance of Eligible Receivables with original
maturities in excess of 72 months shall not exceed 10% of the Aggregate
Outstanding Principal Balance of all Eligible Receivables at such time, (B) had
an original Amount Financed of at least $1,000 and not more than $50,000,
(C) had an Annual Percentage Rate of at least 7.75% and not more than 27.0%, and
(D) was not more than 30 days past due; (ii) no funds have been advanced with
respect to SUCH RECEIVABLE by the Borrower, the Servicer, any Dealer, or anyone
acting on behalf of any of them in order to cause such receivable to qualify
under SUBCLAUSE (i)(D) of this CLAUSE (f); and (iii) had no provision thereof
waived, altered or modified in any respect since its origination other than any
provision requiring vendor single interest insurance and those waivers,
alterations or modifications specifically permitted pursuant to SECTION 8.2 of
this Agreement;
(g) with respect to which the information pertaining to such
Receivable set forth in each
Schedule of Receivables submitted to the Agent and the Custodian is true and
correct in all material respects;
(h) with respect to which, by the related Advance Date and on each
relevant date thereafter, AFL will have caused the portions of AFL's servicing
records relating to such Receivable to be clearly and unambiguously marked to
show that such Receivable constitutes part of the Collateral and is subject to
the Lien of the Collateral Agent on behalf of the Secured Parties;
(i) with respect to which the Monthly Tape delivered by the Servicer
to the Backup Servicer from time to time was complete and accurate as of the
date delivered and consistent with the information set forth in the Schedule of
Receivables with respect to such Receivable;
(j) which constitutes chattel paper within the meaning of the UCC;
(k) of which there is only one original executed copy;
(l) with respect to each of which a Receivable File is in the
possession of the Custodian and such Receivable File contains (i) the fully
executed original of such Receivable, (ii) a certificate of insurance, an
application form for insurance signed by the related Obligor, or a signed
representation letter from the Obligor named in such Receivable pursuant to
which such Obligor has agreed to obtain physical damage insurance for the
related Financed Vehicle, or copies thereof, or a documented verbal confirmation
by an insurance agent for such Obligor of a policy number for an insurance
policy for the Financed Vehicle, (iii) the original Lien Certificate (indicating
AFL's interest as first lienholder) or application therefor or a letter from the
applicable Dealer agreeing unconditionally to repurchase the related Receivable
if the certificate of title is not received by the Servicer within 180 days
(PROVIDED that the Lien Certificate is delivered to the Custodian within 180
days), and (iv) a credit application signed by the Obligor, or a copy thereof;
each of such documents which is required to be signed by the Obligor has been
signed by the Obligor in the appropriate spaces; and all blanks on any form have
been properly filled in and each form has otherwise been correctly prepared;
(m) which has not been satisfied, subordinated or rescinded, and the
Financed Vehicle securing such Receivable has not been released from the Lien of
such Receivable in whole or in part;
(n) which was not originated in, or is subject to the laws of, any
jurisdiction the laws of which would make unlawful, void or voidable the sale,
pledge, transfer and assignment of such Receivable under this Agreement and with
respect to which AFL has not entered into any agreement with any account debtor
that prohibits, restricts or conditions the assignment of any portion of such
Receivable;
(o) which has not been sold, transferred, assigned or pledged by the
Borrower to any Person other than hereunder; and no Dealer has a participation
in, or other right to receive, proceeds of such Receivable and with respect to
which neither AFL nor the Borrower has taken any action to convey any right to
any Person (other than hereunder) that would result in such
Person having a right to payments received under the related Insurance Policy or
the related Dealer Agreement or Dealer Assignment or to payments due under such
Receivable;
(p) which has created, or will create when all required procedures are
completed by the Servicer, a valid, binding and enforceable first priority
perfected security interest in the related Financed Vehicle in favor of AFL as
secured party, and such security interest is, or will be upon the completion of
all required procedures by the Servicer, prior to all other Liens upon and
security interests in such Financed Vehicle that now exist or may hereafter
arise or be created (except, as to priority, for any tax liens or mechanic's
liens that may arise after the applicable Advance Date for such Receivable);
(q) as to which all filings (including, without limitation, UCC
filings) required to be made by any Person and actions required to be taken or
performed by any Person in any jurisdiction to give the Collateral Agent, on
behalf of the Secured Parties, a first priority perfected Lien on such
Receivable and the proceeds thereof and the other Collateral related thereto
have been made, taken or performed;
(r) as to which neither AFL nor the Borrower has done anything to
convey any right to any Person that would result in such Person having a right
to payments due under such Receivable or otherwise to impair the rights of the
Collateral Agent on behalf of the Secured Parties in such Receivable or the
proceeds thereof;
(s) which is not assumable by another Person in a manner which would
release the Obligor thereof from such Obligor's obligations to the Borrower with
respect to such Receivable;
(t) which is not subject to any right of rescission, setoff,
counterclaim or defense and no such right has been asserted or threatened with
respect thereto;
(u) (i) if determined on any day during a Collection Period prior to
the Distribution Date occurring during such Collection Period, as of the last
day of the second preceding Collection Period, or (ii) if determined on any day
during a Collection Period after the Distribution Date occurring during such
Collection Period, as of the last day of the immediately preceding Collection
Period: as to which there has been no default, breach, violation or event
permitting acceleration under the terms of such Receivables (other than payment
delinquencies of not more than 30 days) and no condition exists or event has
occurred and is continuing that with notice, the lapse of time or both would
constitute a default, breach, violation or event permitting acceleration under
the terms of such Receivables, and there has been no waiver of any of the
foregoing, and with respect to which the related Financed Vehicle had not been
repossessed;
(v) at the time of the origination of which the related Financed
Vehicle was covered by a comprehensive and collision insurance policy (i) in an
amount at least equal to the lesser of (a) its maximum insurable value and
(b) the Amount Financed, (ii) naming AFL as loss payee and (iii) insuring
against loss and damage due to fire, theft, transportation, collision and other
risks generally covered by comprehensive and collision coverage and with respect
to which the Obligor is required to maintain physical loss and damage insurance,
naming AFL and its successors and assigns as an additional insured party, and
such Receivable permits the holder
thereof to obtain physical loss and damage insurance at the expense of the
Obligor if the Obligor fails to do so unless otherwise prohibited by the law of
the state in which the related contract was entered into;
(w) with respect to which the following is true:
The Lien Certificate for the related Financed Vehicle shows, or,
if a new or replacement Lien Certificate is being applied for with respect to
such Financed Vehicle, the Lien Certificate will be received within 180 days of
the related Purchase Date and will show, AFL named as the original secured party
under such Receivable and, accordingly, AFL will be the holder of a first
priority security interest in such Financed Vehicle. With respect to each
Receivable for which the Lien Certificate has not yet been returned from the
Registrar of Titles, AFL has received written evidence from the related Dealer
or the Obligor that such Lien Certificate showing AFL as first lienholder has
been applied for. If the Receivable was originated in a state in which a filing
or recording is required of the secured party to perfect a security interest in
motor vehicles, such filings or recordings have been duly made to show AFL named
as the original secured party under the related Receivable;
(x) as to which no selection procedures adverse to the Investors
have been utilized in selecting such Receivable from all other similar
Receivables owned or originated by AFL;
(y) that, if determined on any day during a Collection Period prior
to the Distribution Date occurring during such Collection Period, was not a
Defaulted Receivable as of the last day of the second preceding Collection
Period, or, if determined on any day during a Collection Period after the
Distribution Date occurring during such Collection Period, was not a Defaulted
Receivable as of the last day of the immediately preceding Collection Period;
(z) that, if determined on any day during a Collection Period prior to
the Distribution Date occurring during such Collection Period, was not a
Delinquent Receivable as of the last day of the second preceding Collection
Period, or, if determined on any day during a Collection Period after the
Distribution Date occurring during such Collection Period, was not a Delinquent
Receivable as of the last day of the immediately preceding Collection Period;
and
(aa) that is not secured by vehicles which are financed repossessions.
For purposes of this definition, the eligibility of
Receivables will be determined from time to time, such that a Receivable
that was an Eligible Receivable at one time but that subsequently fails
to meet all applicable eligibility requirements will no longer be an
Eligible Receivable (unless and until it again meets all applicable
eligibility requirements).
"ELIGIBLE SERVICER" means AFL, the Backup Servicer or another
Person which at the time of its appointment as Servicer (i) is servicing
a portfolio of motor vehicle retail installment sales contracts and/or
motor vehicle installment loans, (ii) is legally qualified and has the
capacity to service the Transferred Receivables, (iii) has demonstrated
the ability professionally and competently to service a portfolio of
motor vehicle retail installment sales
contracts and/or motor vehicle installment loans similar to the
Transferred Receivables with reasonable skill and care, and (iv) is
qualified and entitled to use, pursuant to a license or other written
agreement, and agrees to maintain the confidentiality of, the software
which the Servicer uses in connection with performing its duties and
responsibilities under this Agreement or otherwise has available software
which is adequate to perform its duties and responsibilities under this
Agreement.
"ERISA" means the U.S. Employee Retirement Income Security Act of
1974, as amended from time to time.
"EUROCURRENCY LIABILITIES" has the meaning assigned to that term
in Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"EURODOLLAR ADVANCE" means any Advance (or portion thereof) that
bears Yield computed by reference to the Eurodollar Rate.
"EURODOLLAR RATE" means, for any Fixed Period, a rate per annum
equal to the rate for deposits in Dollars for a term equal to such Fixed
Period (commencing on the first day of such Fixed Period) which appears
on Telerate Page 3750 as of 11:00 A.M. (London time) on the second
Business Day prior to the commencement of such Fixed Period. If such
rate does not appear on Telerate Page 3750, a rate per annum at which
deposits in Dollars are offered by the principal office of CSFB in
London, England to prime banks in the London interbank market at 11:00
A.M. (London time) two Business Days before the first day of such Fixed
Period in an amount substantially equal to the principal amount of the
Advance associated with such Fixed Period on such first day and for a
period equal to such Fixed Period.
"EURODOLLAR RATE RESERVE PERCENTAGE" of any Lender for any Fixed
Period in respect of which Yield is computed by reference to the
Eurodollar Rate means the reserve percentage applicable two Business Days
before the first day of such Fixed Period under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or
any successor) (or if more than one such percentage shall be applicable,
the daily average of such percentages for those days in such Fixed Period
during which any such percentage shall be so applicable) for determining
the maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement) for such
Lender with respect to liabilities or assets consisting of or including
Eurocurrency liabilities (or with respect to any other category of
liabilities that includes deposits by reference to which the yield rate
on Eurocurrency liabilities is determined) having a term equal to such
Fixed Period.
"EVENT OF BANKRUPTCY" shall be deemed to have occurred with
respect to a Person if either:
(a) a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court, seeking the liquidation,
reorganization, debt arrangement, dissolution, winding up, or composition or
readjustment of debts of such Person, the appointment of a trustee, receiver,
custodian, liquidator, assignee, sequestrator or the like for such Person or all
or
substantially all of its assets, or any similar action with respect to such
Person under any law relating to bankruptcy, insolvency, reorganization, winding
up or composition or adjustment of debts, and such case or proceeding shall
continue undismissed, or unstayed and in effect, for a period of 60 consecutive
days; or an order for relief in respect of such Person shall be entered in an
involuntary case under the federal bankruptcy laws or other similar laws now or
hereafter in effect; or
(b) such Person shall commence a voluntary case or other proceeding
under any applicable bankruptcy, insolvency, reorganization, debt arrangement,
dissolution or other similar law now or hereafter in effect, or shall consent to
the appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) for such Person or
for any substantial part of its property, or shall make any general assignment
for the benefit of creditors, or shall fail to, or admit in writing its
inability to, pay its debts generally as they become due, or, if a corporation
or similar entity, its board of directors shall vote to implement any of the
foregoing.
"FACE AMOUNT" means, with respect to outstanding commercial paper,
(i) the face amount of any such commercial paper issued on a discount
basis, and (ii) the principal amount of, plus the amount of all interest
accrued and to accrue thereon to the stated maturity date of, any
commercial paper issued on an interest-bearing basis.
"FACILITY" has the meaning set forth in SECTION 2.1.
"FACILITY LIMIT" means $150,000,000, as such amount may be
reduced pursuant to SECTION 2.7. References to the unused portion of
the Facility Limit shall mean, at any time, the Facility Limit, as
then reduced pursuant to SECTION 2.7, MINUS the sum of the then
outstanding principal amount of Advances under this Agreement.
"FACILITY TERMINATION DATE" means the earliest to occur of (i) the
date of any termination of the Facility, in whole, by the Borrower
pursuant to SECTION 2.7, (ii) the effective date on which the Facility is
terminated pursuant to SECTION 14.2, and (iii) the Commitment Termination
Date.
"FACILITY TERMINATION EVENT" means any of the events described in
SECTION 14.1.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating rate per
annum equal for each day during such period to the weighted average of
the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published
for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a Business Day, the
average of the quotations for such day on such transactions received by
the Agent from three federal funds brokers of recognized standing
selected by it.
"FEE LETTER" has the meaning set forth in SECTION 3.4.
"FEES" means all fees and other amounts payable to the Agent, on
behalf of itself, the Lenders and the Liquidity Providers, pursuant to
the Fee Letter.
"FINANCED VEHICLE" means any automobile, light duty truck, van,
minivan or sport utility vehicle, together with all accessories,
additions and parts constituting a part thereof and all accessions
thereto.
"FIXED PERIOD" means with respect to any Advance (or portion
thereof):
(a) the period commencing on the date of the initial funding of such
Advance (or such portion) and ending such number of days (not to exceed 90 days)
thereafter as the Agent shall select, after consultation to the extent
practicable with the Borrower; and
(b) thereafter, each period commencing on the last day of the
immediately preceding Fixed Period for such Advance (or such portion) and ending
such number of days (not to exceed 90 days) thereafter as the Agent shall then
select, after consultation to the extent practicable with the Borrower;
PROVIDED, HOWEVER, that:
(i) any Fixed Period in respect of which Yield is computed by
reference to the Bank Rate shall be a period of from one to and including 29
days (if reasonably available to the Agent), or a period of one, two or three
months, as the Borrower may select, as herein provided;
(ii) any such Fixed Period (other than a Fixed Period consisting of one
day) that would otherwise end on a day that is not a Business Day shall be
extended to the next succeeding Business Day (unless the related Advance shall
be accruing Yield at a rate determined by reference to the Eurodollar Rate, in
which case if such succeeding Business Day is in a different calendar month,
such Fixed Period shall instead be shortened to the next preceding Business
Day);
(iii) in the case of Fixed Periods of one day, (A) the initial Fixed
Period shall be the day of the initial funding of such Advance, and (B) any
subsequently occurring Fixed Period that is one day shall, if the immediately
preceding Fixed Period is more than one day, be the last day of such immediately
preceding Fixed Period, and if the immediately preceding Fixed Period is one
day, shall be the next day following such immediately preceding Fixed Period;
and
(iv) if any Fixed Period for any Advance that commences before the
Facility Termination Date would otherwise end on a date occurring after the
Facility Termination Date, such Fixed Period shall end on the Facility
Termination Date and the duration of each such Fixed Period that commences on or
after the Facility Termination Date, IF ANY, shall be of such duration as shall
be selected by the Agent.
"FORCE-PLACED INSURANCE" has the meaning set forth in
SECTION 8.4(b).
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such
other statements by such other entity as may be approved by a significant
segment of the accounting profession, which are applicable to the
circumstances as of any date of determination.
"INDEBTEDNESS" of any Person means, without duplication:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;
(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's acceptances
issued for the account of such Person;
(c) all obligations of such Person as lessee under leases that have
been or should be, in accordance with GAAP, recorded as capitalized lease
liabilities;
(d) all other items that, in accordance with GAAP, would be included
as liabilities on the liability side of the balance sheet of such Person as of
the date at which Indebtedness is to be determined;
(e) whether or not so included as liabilities in accordance with GAAP,
all obligations of such Person to pay the deferred purchase price of property or
services, and indebtedness (excluding prepaid interest thereon) secured by a
lien on property owned or being purchased by such Person (including indebtedness
arising under conditional sales or other title retention agreements), whether or
not such indebtedness shall have been assumed by such Person or is limited in
recourse; and
(f) all Contingent Liabilities of such Person in respect of any of the
foregoing.
"INDEMNIFIED AMOUNTS" has the meaning set forth in SECTION 17.1.
"INDEMNIFIED PARTY" has the meaning set forth in SECTION 17.1.
"INDEPENDENT ACCOUNTANTS" has the meaning set forth in SECTION
8.11(a).
"INSURANCE ADD-ON AMOUNT" means the premium charged to the Obligor
if the Servicer obtains Force-Placed Insurance pursuant to SECTION 8.4.
"INSURANCE POLICIES" means, with respect to a Receivable, any
insurance policy (including the insurance policies described in
subsection (v) of the definition of "ELIGIBLE RECEIVABLE") benefiting the
holder of the Receivable providing loss or physical damage, credit life,
credit disability, theft, mechanical breakdown or similar coverage with
respect to the Financed Vehicle or the Obligor.
"INTEREST RATE HEDGE" means any interest rate cap or other hedging
mechanism which satisfies the requirements of SECTION 11.6.
"INTEREST RATE HEDGE ASSIGNMENT ACKNOWLEDGMENT" means an
acknowledgment in substantially the form of EXHIBIT C hereto executed by
a counterparty to an Interest Rate Hedge (if other than CSFB) in favor of
the Agent and the Collateral Agent.
"INTERIM DISTRIBUTION DATE" means any Settlement Date, other than
a Distribution Date, on which the Collateral Agent shall pay principal,
Yield and certain other amounts in accordance with this Agreement and the
Collateral Agent Agreement.
"INVESTOR" means (i) all Lenders, (ii) all other owners by
assignment or participation of an Advance and, to the extent of the
undivided interests so purchased, shall include any Participants and
(iii) all holders of the Note.
"JOINDER SUPPLEMENT" means an agreement among the Noncommitted
Lender, the Borrower, AFL and the Agent in the form of EXHIBIT F hereto.
"LENDERS" has the meaning set forth in the PREAMBLE.
"LEVEL I TRIGGER EVENT" means, as of any date, the existence of a
Portfolio Trigger Event on such date. A "Level I Trigger Event" shall be
deemed to exist so long as the underlying Portfolio Trigger Event is not
cured (including cure by an amendment to the terms of the relevant
Portfolio Trigger Event) or waived in accordance with the related
transaction documents.
"LEVEL II TRIGGER EVENT" means, as of any date, the existence of a
Portfolio Default on such date. A "Level II Trigger Event" shall be
deemed to exist so long as the underlying Portfolio Default is not cured
(including cure by an amendment to the terms of the relevant Portfolio
Default) or waived in accordance with the related transaction documents.
"LEVEL III TRIGGER EVENT" means, on any date, that the Servicer
Delinquency Ratio exceeds 5% on such date and a Level IV Trigger Event is
not in effect on such date.
"LEVEL IV TRIGGER EVENT" means, on any date, that the Servicer
Delinquency Ratio exceeds 6% on such date.
"LEVEL V TRIGGER EVENT" means, on any date, that the Portfolio Net
Loss Ratio exceeds 5% on such date and a Level VI Trigger Event is not in
effect on such date.
"LEVEL VI TRIGGER EVENT" means, on any date, that the Portfolio
Net Loss Ratio exceeds 5.5% on such date.
"LIEN" means any security interest, lien, charge, pledge,
preference, equity or encumbrance of any kind, including tax liens,
mechanics' liens and any liens that attach by operation of law.
"LIEN CERTIFICATE" means, with respect to a Financed Vehicle, an
original certificate of title, certificate of lien or other notification
issued by the Registrar of Titles of the applicable state to a secured
party which indicates that the lien of the secured party on the Financed
Vehicle is recorded on the original certificate of title. In any
jurisdiction in which the original certificate of title is required to be
given to the Obligor, the term "Lien Certificate" shall mean only a
certificate or notification issued to a secured party.
"LIQUIDATED RECEIVABLE" means a Defaulted Receivable as to which
(i) 91 days have elapsed since the date the Servicer repossessed the
Financed Vehicle (following the expiration of any applicable redemption
period), (ii) the Servicer has charged-off such Receivable in accordance
with its standard policies or otherwise has determined in good faith that
all amounts it expects to recover have been received or (iii) all or any
portion in excess of $10 of a Scheduled Payment shall have become more
than 180 days delinquent.
"LIQUIDITY PROVIDER" means each Person who provides liquidity,
credit enhancement or a "back-stop" purchase facility to the Noncommitted
Lender under a Noncommitted Lender Liquidity Arrangement.
"LOCKBOX ACCOUNT" has the meaning given such term in SECTION
8.2(e).
"LOCKBOX AGREEMENT" means the Agency Agreement, dated as of
November 13, 1992 by and among ▇▇▇▇▇▇ Trust and Savings Bank, AFL,
Shawmut Bank, N.A., as Trustee, Saturn Financial Services, Inc. and the
Program Parties (as defined therein), taken together with the Retail
Lockbox Agreement, dated as of November 13, 1992, among such parties, and
the Counterpart to Agency Agreement and Retail Lockbox Agreement, dated
as of the date hereof, among ▇▇▇▇▇▇ Trust and Savings Bank, AFL, the
Borrower and the Collateral Agent, as such agreements may be amended from
time to time, unless the Collateral Agent shall cease to be a Program
Party thereunder, or such agreement shall be terminated in accordance
with its terms, in which event "Lockbox Agreement" shall mean such other
agreement, in form and substance acceptable to the Agent, among the
Servicer, the Borrower, the Collateral Agent and the Lockbox Bank.
"LOCKBOX BANK" means ▇▇▇▇▇▇ Trust and Savings Bank or any other
depository institution named by the Servicer and acceptable to the Agent.
"MARKET RATE SERVICING FEE RATE" has the meaning specified in
SECTION 13.3(c).
"MAXIMUM INTEREST RATE CAP STRIKE PRICE" means 6.5% per annum.
"MINIMUM RESERVE ACCOUNT AMOUNT" means, on any date, the greater
of (a) $200,000 and (b) the product of 2.0% and the sum of (i) the
aggregate unpaid principal amount of all Advances on such date PLUS (ii)
the Required Holdback in effect on such date.
"MONTHLY EXCESS SPREAD PERCENTAGE" means, as of the last day of
any Collection Period, (i) the weighted average APR with respect to all
Eligible Receivables in the Total
Receivables Pool for such Collection Period MINUS (ii) the ratio
(expressed as a percentage) of (A) 12 times the sum of (I) the aggregate
amount of Yield, Fees (to the extent such Fees accrued during any period
during such Collection Period while any Advance was outstanding),
Custodian Fees, Servicer Fees, Collateral Agent Fees and Backup Servicer
Fees incurred by the Borrower under the Transaction Documents during such
Collection Period and (II) the aggregate principal amount of Receivables
in the Total Receivables Pool which became Liquidated Receivables during
such Collection Period (net of any Recoveries) to (B) the average
Aggregate Outstanding Principal balance of all Receivables in the Total
Receivables Pool during such Collection Period.
"MONTHLY RECORDS" means all records and data maintained by the
Servicer with respect to the Transferred Receivables, including the
following with respect to each Transferred Receivable: the account
number; the originating Dealer; Obligor name; Obligor address; Obligor
home phone number; Obligor business phone number; original Principal
Balance; original term; Annual Percentage Rate; current Principal
Balance; origination date; first payment date; next payment due date;
date of most recent payment; new/used classification; collateral
description; days currently delinquent; number of contract extensions
(months) to date; amount of Scheduled Payment; and, once available,
current remaining term and current Insurance Policy expiration date and
past due late charges.
"MONTHLY TAPE" means the computer tape or listing generated on
behalf of the Borrower which contains the information set forth in the
definition of "Monthly Records" above and in a format acceptable to the
Backup Servicer.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc.
"NET YIELD" means, as of the last day of any Collection Period,
the average of the Monthly Excess Spread Percentages as of the last day
of such Collection Period and as of the last day of the two immediately
preceding Collection Periods.
"NONCOMMITTED LENDER" means the Structured Lender which shall
become a party hereto pursuant to a Joinder Supplement duly executed by
all parties thereto on or prior to the Closing Date.
"NONCOMMITTED LENDER LIQUIDITY ARRANGEMENT" means each liquidity,
credit enhancement or "back-stop" purchase or loan facility for the
Noncommitted Lender relating to this Agreement.
"NORWEST" has the meaning set forth in the PREAMBLE.
"NORWEST FEE LETTER" means (a) that certain letter agreement,
dated as of the date hereof, among Norwest, AFL and the Borrower, and
consented to by the Agent, as the same may be amended, supplemented or
otherwise modified by the parties thereto with the consent of the Agent
and (b) any letter agreement(s) entered into by AFL and the Borrower,
with the consent of the Agent, with a substitute Backup Servicer and/or
Collateral Agent in replacement of the letter agreement referred to in
clause (a) above relating to fees payable to such substitute Backup
Servicer and/or Collateral Agent.
"NOTE" means the promissory grid note, in the form of EXHIBIT B,
made payable to the order of the Agent, on behalf of the Investors.
"NOTE REGISTER" has the meaning set forth in SECTION 16.5(a).
"NOTE REGISTRAR" has the meaning set forth in SECTION 16.5(a).
"OBLIGATIONS" means all obligations (monetary or otherwise) of the
Borrower to the Lenders, the Collateral Agent, the Agent or any other
Affected Person arising under or in connection with this Agreement, the
Note and each other Transaction Document.
"OBLIGOR" means a Person obligated to make payments with respect
to a Transferred Receivable.
"OFFICER'S CERTIFICATE" means, with respect to any Person which is
not an individual, a certificate signed by the President, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer or any Vice
President of such Person.
"OFFICIAL BODY" means any government or political subdivision or
any agency, authority, regulatory body, bureau, central bank, commission,
department or instrumentality of any such government or political
subdivision, or any court, tribunal, grand jury or arbitrator, in each
case whether foreign or domestic.
"OPINION OF COUNSEL" means a written opinion of counsel reasonably
acceptable to the Agent which, unless otherwise provided herein, may be
an employee of the Person delivering such opinion.
"OTHER CONVEYED PROPERTY" has the meaning set forth in the
Purchase Agreement.
"PARTICIPANT" has the meaning set forth in SECTION 16.9.
"PERMITTED INVESTMENT" means any one or more of the following
types of investments:
(a) (i) direct interest-bearing obligations of, and interest-bearing
obligations guaranteed as to timely payment of principal and interest by, the
United States or any agency or instrumentality of the United States, the
obligations of which are backed by the full faith and credit of the United
States; and (ii) direct interest bearing obligations of, and interest-bearing
obligations guaranteed as to timely payment of principal and interest by, the
Federal National Mortgage Association or the Federal Home Loan Mortgage
Corporation, but only if, at the time of investment, such obligations are
assigned the highest credit rating by each Rating Agency;
(b) demand or time deposits in, certificates of deposit of, or
bankers' acceptances issued by any depository institution or trust company
organized under the laws of the United States or any State thereof (including
any federal or state branch or agency of a foreign depository institution or
trust company) and subject to supervision and examination by federal and/or
state
banking authorities (including, if applicable, the Collateral Agent or any agent
thereof acting in its commercial capacity); PROVIDED that the short-term
unsecured debt obligations of such depository institution or trust company at
the time of such investment, or contractual commitment providing for such
investment, are assigned the highest credit rating by each Rating Agency;
(c) repurchase obligations pursuant to a written agreement (i) with
respect to any obligation described in clause (a) above, where the Collateral
Agent has taken actual or constructive delivery of such obligation, and (ii)
entered into with (x) CSFB or (y) the corporate trust department of a depository
institution or trust company organized under the laws of the United States or
any State thereof, the deposits of which are insured by the Federal Deposit
Insurance Corporation and the short-term unsecured debt obligations of which are
rated "A-1+" by Standard & Poor's and "P-1" by Moody's (including, if
applicable, the Collateral Agent or any agent thereof acting in its commercial
capacity);
(d) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States or any State whose
long-term unsecured debt obligations are assigned the highest credit rating by
each Rating Agency at the time of such investment or contractual commitment
providing for such investment; PROVIDED, HOWEVER, that securities issued by any
particular corporation will not be Permitted Investments to the extent that an
investment therein will cause the then outstanding principal amount of
securities issued by such corporation and held in the Collection Account and the
Reserve Account to exceed 10% of the value of Permitted Investments held in such
accounts (with Permitted Investments held in such accounts valued at par);
(e) commercial paper that (i) is payable in United States dollars and
(ii) is rated in the highest credit rating category by each Rating Agency;
(f) units of money market funds rated in the highest credit rating
category by each Rating Agency; or
(g) any other demand or time deposit, obligation, security or
investment (including, without limitation, a hedging arrangement) as may be
acceptable to the Agent, as evidenced by a writing to that effect, as may from
time to time be confirmed in writing to the Collateral Agent by the Agent.
Permitted Investments may be purchased by or through the Collateral Agent
or any of its Affiliates. All Permitted Investments shall be held in the
name of the Collateral Agent.
"PERSON" means an individual, partnership, corporation (including
a business trust), joint stock company, trust, unincorporated
association, joint venture, government or any agency or political
subdivision thereof or any other entity.
"PORTFOLIO DEFAULT" means the occurrence, with respect to
securities issued on or after June 1, 1998 which are backed by
automobile installment sales contracts ("receivables") and with respect
to which AFL or any Affiliate of AFL is the servicer, of an "event of
default" or
similar event under any applicable enhancement or insurance agreement or
an "amortization event", "pay-out event" or similar event under any
applicable sale and servicing agreement or indenture which event has the
potential consequence, INTER ALIA, under the related agreements of
requiring the acceleration or early amortization of the related
securities or permitting the realization upon the receivables and/or
other collateral.
"PORTFOLIO NET LOSSES" means with respect to any Collection
Period, the aggregate amount of gross charge-offs of Receivables in the
Servicing Portfolio during such Collection Period net of all Recoveries
with respect to any such Receivables (including post-disposition amounts
received on previously charged-off Receivables), calculated in a manner
consistent with the calculations of net losses in AFL's Annual Report on
Form 10-K for the year ended December 31, 1997.
"PORTFOLIO NET LOSS RATIO" means, as of any date, a fraction,
expressed as a percentage, the numerator of which equals the product of
2.0 times the Portfolio Net Losses for the six (6) preceding Collection
Periods (excluding the June 1998 Collection Period) and the denominator
of which equals the Average Servicing Portfolio as of such date. The
Portfolio Net Loss Ratio shall be determined on each Determination Date
and shall remain in effect until recalculated on the next succeeding
Determination Date.
"PORTFOLIO TRIGGER EVENT" means the occurrence of a "trigger
event" or any other event however denominated, with respect to securities
issued on or after June 1, 1998 which are backed by automobile
installment sales contracts ("receivables") and with respect to which AFL
or any Affiliate of AFL is the servicer, which event is based on the
performance of such receivables and has the potential consequence under
the related agreements of causing the amount required to be retained in
any related spread or reserve account or the level of any other
enhancement to be increased.
"PRE-COMPUTED RECEIVABLE" means any Receivable under which the
portion of a payment allocable to earned interest (which may be referred
to in the related Receivable as an add-on finance charge) and the portion
allocable to the Amount Financed is determined according to the sum of
periodic balances or the sum of monthly balances or any equivalent method
or are monthly actuarial receivables.
"PRINCIPAL BALANCE" means, with respect to any Receivable, as of
any date, the Amount Financed MINUS (i) that portion of all amounts
received by the Servicer with respect to such Receivable on or prior to
such date and allocable to principal in accordance with the terms of such
Receivable, and (ii) any Cram Down Loss in respect of such Receivable.
"PURCHASE AMOUNT" means, with respect to a Receivable purchased by
the Servicer pursuant to SECTION 8.4 or 8.7, the Principal Balance of
such Receivable and all accrued and unpaid interest on such Receivable as
of the date of such purchase.
"PURCHASE AGREEMENT" means the Receivables Purchase Agreement and
Assignment dated as of the date hereof by and between the Borrower and
AFL, including all permitted amendments, modifications and supplements
thereto.
"PURCHASE DATE" has the meaning assigned to the term "Transfer
Date" in the Purchase Agreement.
"RATING AGENCIES" means Standard & Poor's and Moody's.
"RECEIVABLE" means any right to payment from a Person, and
includes without limitation the right to payment of any interest or
finance charges and other obligations of such Person with respect
thereto.
"RECEIVABLE FILE" means, with respect to each Receivable in the
Total Receivables Pool, the documents, electronic entries, instruments
and writings set forth in paragraph (l) of the definition of "Eligible
Receivable" herein.
"RECORD DATE" means, with respect to any Determination Date or
Distribution Date, the last day of the immediately preceding calendar
month.
"RECOVERIES" means, with respect to any Liquidated Receivable,
monies collected in respect thereof, from whatever source, during any
Collection Period, net of the sum of any reasonable expenses incurred by
the Servicer in connection with the collection, repossession and
disposition of the related Financed Vehicle and any amounts required by
law to be remitted to the Obligor; PROVIDED that Recoveries with respect
to any Liquidated Receivable shall in no event be less than zero.
"REGISTRAR OF TITLES" means, with respect to any state, the
governmental agency or body responsible for the registration of, and the
issuance of certificates of title relating to, motor vehicles and liens
thereon.
"REPLACEMENT PERSON" has the meaning set forth in SECTION 6.4.
"REQUIRED HOLDBACK" means, as of any date, the sum of (i) the
greater of (a) the product of (1) the Required Percentage and (2) the
Aggregate Outstanding Principal Balance of Eligible Receivables in the
Total Receivables Pool on such date and (b)$1,000,000, PROVIDED that the
amount set forth in this clause (b) shall be deemed to be zero during
(x) any period that no Advances are outstanding and (y) the two Business
Day period following the date of the making of each Advance; PLUS (ii)
the Deficiency Amount for such date.
"REQUIRED LENDERS" means, at any time, (a) the Noncommitted Lender
to the extent (i) such time is during any period that no Advances are
outstanding hereunder or (ii) all or any portion of the Advances are
owing to it at such time, and (b) Banks having Commitments aggregating at
least 66% of the aggregate Commitments of all Banks.
"REQUIRED PERCENTAGE" means 8% or such lower percentage (but in no
event less than 6%) as may be agreed to by S&P and Moody's to rate this
Agreement and the Advances hereunder "A/A2".
"REQUIRED RESERVE ACCOUNT AMOUNT" means, on any date, the greater
of (a) $200,000 and (b) the product of the Stated Percentage in effect on
such date and the sum of (i) the aggregate unpaid principal amount of all
Advances on such date PLUS (ii) the Required Holdback in effect on such
date.
"RESERVE ACCOUNT" means the account designated as the Reserve
Account in, and which is established and maintained pursuant to, SECTION
8.17(b).
"RESERVE ACCOUNT SHORTFALL" means, as of any date, an amount (if
positive) equal to the Required Reserve Account Amount on such date MINUS
the amount on deposit in the Reserve Account on such date.
"RESPONSIBLE OFFICER" means, with respect to any Person that is
not an individual, the President, any Vice-President or Assistant
Vice-President, Corporate Trust Officer, the Treasurer or Assistant
Treasurer, or the Controller or Assistant Controller or Warehouse Manager
of such Person, or any other officer or employee having similar
functions.
"SCHEDULE OF RECEIVABLES" means the Schedule of Receivables in the
form prescribed by the Purchase Agreement in Schedule A thereto, as
supplemented from time to time in connection with the transfer of
Receivables by AFL to the Borrower.
"SCHEDULED PAYMENT" means, with respect to any Receivable, the
periodic payment set forth in such Receivable (excluding, however, any
portion of such payment that represents late payment charges and payments
in respect of taxes, licenses or similar items).
"SECURED PARTIES" means, collectively, the Collateral Agent, the
Agent, each Lender, each other Affected Person and their respective
successors and assigns.
"SERVICER" means AFL or, as applicable, any successor servicer
appointed pursuant to SECTION 13.3.
"SERVICER DELINQUENCY RATIO" means, as of the last day of a
Collection Period, the ratio, expressed as a percentage, computed by
dividing (i) the Aggregate Outstanding Principal Balance on such date of
all Receivables in the Servicing Portfolio that are Delinquent
Receivables or Defaulted Receivables by (ii) the Aggregate Outstanding
Principal Balance of all Receivables in the Servicing Portfolio on the
last day of such Collection Period.
"SERVICER EXTENSION NOTICE" has the meaning set forth in SECTION
8.14.
"SERVICER TERMINATION EVENT" has the meaning set forth in SECTION
13.1.
"SERVICER'S CERTIFICATE" means, with respect to each Determination
Date, a certificate, completed by and executed on behalf of the Servicer,
in accordance with SECTION 8.9, substantially in the form attached hereto
as EXHIBIT E.
"SERVICING FEE" means, as of any Distribution Date, an amount
equal to the product of
(i) 1/12 of the Servicing Fee Rate and (ii) the average Aggregate
Outstanding Principal Balance of Receivables in the Total Receivables
Pool for each day during the Collection Period immediately preceding such
Distribution Date.
"SERVICING FEE RATE" means 1.25% or, following the appointment of
the Backup Servicer hereunder pursuant to SECTION 13.3 hereof, as
provided in SECTION 13.3(c).
"SERVICING PORTFOLIO" means as of any date, the Aggregate
Outstanding Principal Balance of all Receivables (whether or not
thereafter sold or disposed of) which are serviced by the Servicer or any
of its Affiliates at such time, calculated in a manner consistent with
the calculation of the components of Average Servicing Portfolio in the
Servicer's most recent Annual Report on Form 10-K to the extent such
calculation is consistent with the calculation of the components of
Average Servicing Portfolio in AFL's most recent Annual Report on
Form 10-K.
"SERVICING PROCEDURES MANUAL" means the collections procedures
manual used by AFL in the servicing of Receivables, as amended from time
to time.
"SETTLEMENT DATE" means, with respect to any Advance, (a) each
Distribution Date, (b) at the option of the Agent or the Borrower, the
last day of the current Fixed Period of such Advance or (c) the date on
which the Borrower shall prepay such Advance pursuant to SECTION 4.1
hereof.
"SIMPLE INTEREST METHOD" means the method of allocating a fixed
level payment on an obligation between principal and interest, pursuant
to which the portion of such payment that is allocated to interest is
equal to the product of the fixed rate of interest on such obligation
multiplied by the period of time (expressed as a fraction of a year,
based on the actual number of days in the calendar month and 365 days in
the calendar year) elapsed since the preceding payment under the
obligation was made.
"SIMPLE INTEREST RECEIVABLE" means a Receivable under which the
portion of the payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"STANDARD & POOR'S" OR "S&P" means Standard & Poor's Ratings
Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"STATED PERCENTAGE" means, on any date, the sum of (a) 4% PLUS (b)
the LESSER of (x) 6% and (y) the aggregate of each Percentage Add-On in
effect on such date as computed below:
If on such date (i) a Level I Trigger Event exists, the Percentage Add-On
related thereto shall be 2%; (ii) a Level II Trigger Event exists, the
Percentage Add-On related thereto shall be 6%; (iii) a Level III Trigger Event
exists, the Percentage Add-On related thereto shall be 2%; (iv) a Level IV
Trigger Event exits, the Percentage Add-On related thereto shall be 6%; (v) a
Level V Trigger Event exists, the Percentage Add-On related thereto shall be 2%;
and (vi) a Level VI Trigger Event exists, the Percentage Add-On related thereto
shall be 6%.
"STRUCTURED LENDER" shall mean any Person whose principal business
consists of issuing commercial paper, medium term notes or other
securities to fund its acquisition and maintenance of receivables,
accounts, instruments, chattel paper, general intangibles and other
similar assets or interests therein and which is required by any
nationally recognized rating agency which is rating such securities to
obtain from its principal debtors an agreement such as that set forth in
SECTION 8.12(a) of this Agreement in order to maintain such rating.
"SUBSIDIARY" means, with respect to any Person, a corporation of
which such Person and/or its other Subsidiaries own, directly or
indirectly, such number of outstanding shares as have more than 50% of
the ordinary voting power for the election of directors.
"TAKE-OUT SECURITIZATION" means (a) a financing transaction of any
sort undertaken by the Borrower or any Affiliate of the Borrower secured,
directly or indirectly, by any Transferred Receivables or (b) any other
asset securitization, secured loans or similar transactions involving any
Transferred Receivables or any beneficial interest therein.
"TANGIBLE NET WORTH" means, with respect to the Borrower, the net
worth of the Borrower calculated in accordance with GAAP after
subtracting therefrom the aggregate amount of the Borrower's intangible
assets, including, without limitation, goodwill, franchises, licenses,
patents, trademarks, tradenames, copyrights and service marks.
"TAXES" has the meaning set forth in SECTION 5.1(b).
"TOTAL EXPENSE PERCENTAGE" means, as of any date, the sum of
(a) the Servicing Fee Rate PLUS (b) the Custodial Fee Rate PLUS (c) the
Backup Servicing Fee Rate PLUS (d) the Collateral Agent Fee Rate.
"TOTAL RECEIVABLES POOL" means all Receivables owned by the
Borrower.
"TRANSACTION DOCUMENTS" means this Agreement, the Note, the Fee
Letter, the Custodial Agreement, the Purchase Agreement, the Lockbox
Agreement, the Collateral Agent Agreement, each Interest Rate Hedge, and
the other documents to be executed and delivered in connection with this
Agreement.
"TRANSFERRED RECEIVABLE" means each Receivable which appears on
any Schedule of Receivables at any time hereafter submitted to and
accepted by the Borrower pursuant to Section 2.2 of the Purchase
Agreement, whether purchased by the Borrower or contributed to the
capital of the Borrower. Once a Receivable appears on any such Schedule
of Receivables it shall remain a Transferred Receivable; PROVIDED,
HOWEVER, that with respect to any Receivable that is purchased or
repurchased by AFL or the Servicer, following the Borrower's receipt of
the purchase price for such Receivable, "TRANSFERRED RECEIVABLE" shall
not include the Receivable so purchased or repurchased.
"TRANSFER REQUEST" has the meaning set forth in SECTION 9.5(a).
"TRANSITION COSTS" means any documented expenses and allocated
cost of personnel reasonably incurred by the Backup Servicer in
connection with a transfer of servicing from the Servicer to the Backup
Servicer as the successor Servicer in an amount not to exceed $100,000.
"UCC" means the Uniform Commercial Code as from time to time in
effect in the applicable jurisdiction or jurisdictions.
"UNMATURED FACILITY TERMINATION EVENT" means any event that, if it
continues uncured, will, with lapse of time or notice or lapse of time
and notice, constitute a Facility Termination Event.
"WARRANTY RECEIVABLE" means, with respect to any Collection
Period, a Receivable that the Servicer has become obligated to repurchase
pursuant to SECTION 8.7.
"WRITTEN" or "IN WRITING" (and other variations thereof) means any
form of written communication or a communication by means of telex,
telecopier device, telegraph or cable.
"YEAR 2000 COMPLIANT" means, with regard to any Person, that all
software, embedded microchips, and other processing capabilities utilized
by, and material to the business or servicing operations or financial
condition of such Person, are able to interpret and manipulate data
involving all calendar dates correctly and without causing any abnormal
ending scenario, including dates in and after the year 2000.
"YIELD" means, with respect to any period, the sum of the
following:
(i) without duplication of the amount set forth in the immediately
following clause (ii), the sum of the daily interest accrued on the commercial
paper issued to fund or maintain any Advance outstanding on each day during such
period equal, for any such day, to the product of (x) the outstanding principal
amount of such commercial paper on such day, (y) the Commercial Paper Rate and
(z) 1/360, PLUS
(ii) if any commercial paper has been issued during such period to fund
the interest component on any other commercial paper maturing on a date other
than a Settlement Date, the sum of the daily interest accrued on such additional
commercial paper outstanding on each day during such period equal, for any such
day, to the product of (x) the outstanding principal amount of such additional
commercial paper on such day, (y) the Commercial Paper Rate and (z) 1/360, PLUS
(iii) the sum of the daily interest accrued on Advances funded or
maintained other than through the issuance of commercial paper on each day
during such period equal, for any such day, to the product of (x) the
outstanding principal amount of such Advances on such day, (y) the Bank Rate and
(z) the applicable computation period determined in accordance with SECTION 3.5
of this Agreement, MINUS
(iv) the amount of Yield paid on all Interim Distribution Dates during
such period.
Notwithstanding clauses (i), (ii) and (iii) above, after the date any
principal amount of any Advance is due and payable (whether on the
Facility Termination Date, upon acceleration or otherwise) or after any
other monetary obligation of the Borrower or the Servicer arising under
this Agreement shall become due and payable, the Borrower or the
Servicer, as the case may be, shall pay (to the extent permitted by law,
if in respect of any unpaid amounts representing Yield) Yield (after as
well as before judgment) on such amounts, payable on demand, at a rate
PER ANNUM equal to the Default Rate.
SECTION 1.2 OTHER DEFINITIONAL PROVISIONS.
(a) Unless otherwise specified therein, all terms defined in
this Agreement have the meanings as so defined herein when used in the
Note or any other Transaction Document, certificate, report or other
document made or delivered pursuant hereto.
(b) Each term defined in the singular form in SECTION 1.1 or
elsewhere in this Agreement shall mean the plural thereof when the plural
form of such term is used in this Agreement, the Note or any other
Transaction Document, certificate, report or other document made or
delivered pursuant hereto, and each term defined in the plural form in
SECTION 1.1 shall mean the singular thereof when the singular form of
such term is used herein or therein.
(c) The words "hereof," "herein," "hereunder" and similar terms
when used in this Agreement shall refer to this agreement as a whole and
not to any particular provision of this Agreement, and article, section,
subsection, schedule and exhibit references herein are references to
articles, sections, subsections, schedules and exhibits to this Agreement
unless otherwise specified.
ARTICLE II
THE FACILITY, ADVANCE PROCEDURES AND NOTE
SECTION 2.1 FACILITY. On the terms and subject to the conditions
set forth in this Agreement, the Noncommitted Lender may, in its sole
discretion, make Advances to the Borrower on a revolving basis from time
to time during the period commencing on the Effective Date and ending on
the Facility Termination Date and, if the Noncommitted Lender elects not
to, each of the Banks shall make Advances to the Borrower (to the extent
of the unutilized Commitment of each Bank and PRO RATA among the Banks in
accordance with their respective Commitment Percentages) on a revolving
basis from time to time during the period commencing on the Effective
Date and ending on the Commitment Termination Date, in each case in such
amounts as may be from time to time requested by the Borrower pursuant to
SECTION 2.2 (the "FACILITY"); PROVIDED, HOWEVER, that the aggregate
principal amount of all Advances from time to time outstanding hereunder
shall not exceed the lesser of (a) the Facility Limit and (b) the
Borrowing Base. Within the limits of the Facility, the Borrower may
borrow, prepay and reborrow under this SECTION 2.1. Under no
circumstances shall any Lender make any such Advance if after giving
effect thereto the aggregate outstanding principal balance of all
Advances would exceed the Facility Limit.
SECTION 2.2 ADVANCE PROCEDURES. The Borrower may request an
Advance hereunder by giving notice to the Agent and the Collateral Agent
of a proposed Advance not later than 1:00 P.M., New York time, one
Business Day prior to the proposed date of such Advance. Each such
notice (herein called an "ADVANCE REQUEST") shall be in the form of
EXHIBIT A and shall include the date and amount of such proposed Advance,
the desired duration of the Fixed Period for such Advance and the
supplement to the Schedule of Receivables setting forth the information
required therein with respect to the Receivables to be acquired by the
Borrower with the proceeds of the proposed Advance. Any Advance Request
given by the Borrower pursuant to this SECTION 2.2 shall be irrevocable
and binding on the Borrower.
SECTION 2.3 FUNDING. Subject to the satisfaction of the
conditions precedent set forth in ARTICLE VII with respect to such
Advance and the limitations set forth in SECTION 2.1, the Lenders shall
make the proceeds of such requested Advance available as follows: FIRST,
to the extent the amount on deposit in the Reserve Account is less than
the Minimum Reserve Account Amount (computed after giving effect to the
proposed Advance) on the proposed date of the Advance, an amount equal to
such deficiency shall be deposited by the Lenders in the Reserve Account
(by wire to account no. ▇▇▇▇▇▇▇ maintained at Norwest (ABA # ▇▇▇▇▇▇▇▇▇)
for further credit to account no. ▇▇▇▇▇▇▇▇); and SECOND, all amounts of
the Advance in excess of the required deposit in the Reserve Account
shall be made available to the Borrower by deposit to account no.
104755881059 maintained at U.S. Bank National Association (ABA#
▇▇▇▇▇▇▇▇▇) in same day funds no later than 3:00 p.m., New York City time,
on the proposed date of the Advance. Each Advance shall be on a Business
Day and shall be in an amount of at least $5,000,000 (or an integral
multiple of $1,000 in excess thereof).
SECTION 2.4 REPRESENTATION AND WARRANTY. Each request for an
Advance pursuant to SECTION 2.2 shall automatically constitute a
representation and warranty by the Borrower to the Agent and the Lenders
that, on the requested date of such Advance, (a) the representations and
warranties contained in ARTICLE X will be true and correct as of such
date as though made on such date, (b) no Facility Termination Event or
Unmatured Facility Termination Event has occurred and is continuing or
will result from the making of such Advance, and (c) after giving effect
to such requested Advance, the aggregate principal balance of the
outstanding Advances hereunder will not exceed the Borrowing Base.
SECTION 2.5 [Intentionally left blank]
SECTION 2.6 [Intentionally left blank]
SECTION 2.7 VOLUNTARY TERMINATION OF FACILITY; REDUCTION OF
FACILITY LIMIT. The Borrower may, in its sole discretion for any reason
upon at least five Business Days' notice to the Agent, terminate the
Facility in whole or reduce in part the unused portion of the Facility
Limit; PROVIDED, HOWEVER, that (a) each such partial reduction will be in
a minimum amount of $5,000,000 or a higher integral multiple of
$1,000,000, (b) in the event of a partial reduction and after giving
effect to any such partial reduction and any prior partial reduction,
the remaining Facility Limit will not be less than $50,000,000, and (c)
in connection therewith the Borrower complies with SECTION 3.2(b),
SECTION 4.l(b) and SECTION 6.3. The amount of such reduction shall be
applied to reduce the Commitment of each Bank PRO RATA on the basis of
the Commitment Percentage of each such Bank. The Agent shall promptly
provide copies of any such notice of termination or reduction received by
it to each Lender together with a computation of the amount by which its
Commitment (if any) has been reduced.
SECTION 2.8 NOTE. All Advances shall be evidenced by a Note,
with appropriate insertions, payable to the order of the Agent, on behalf
of the Investors. The Borrower hereby irrevocably authorizes the Agent
to make (or cause to be made) appropriate notations on the grid attached
to the Note (or on any continuation of such grid, or at the Agent's
option, in its records), which notations, if made, shall evidence, INTER
ALIA, the date of, the outstanding principal of, and the yield rate and
Fixed Period applicable to the Advances evidenced thereby. Such
notations shall be rebuttably presumptive evidence of the subject matter
thereof absent manifest error; PROVIDED, HOWEVER, that the failure to
make any such notations shall not limit or otherwise affect any of the
Obligations.
ARTICLE III
YIELD, FEES, ETC.
SECTION 3.1 YIELD. The Borrower hereby promises to pay Yield on
the unpaid principal amount of each Advance (or each portion thereof) for
the period commencing on the date of such Advance until such Advance is
paid in full. No provision of this Agreement or the Note shall require
the payment or permit the collection of Yield in excess of the maximum
permitted by applicable law.
SECTION 3.2 YIELD PAYMENT DATES. Yield accrued on each Advance
shall be payable, without duplication:
(a) on the Facility Termination Date;
(b) on the date of any payment or prepayment, in whole or in part, of
principal outstanding on such Advance; and
(c) on each Distribution Date; PROVIDED that Yield relating to such
Advance may be payable, at the option of the Agent or the Borrower, on the
related Interim Distribution Date.
SECTION 3.3 YIELD ALLOCATIONS; SELECTION OF FIXED PERIODS, ETC.
(a) The Agent shall, from time to time, in its sole discretion
exercised in good faith, determine whether Yield in respect of the
Advances then outstanding, or any portion thereof, shall be calculated by
reference to the Commercial Paper Rate (such portion being herein called
a "CP ALLOCATION") or the Bank Rate (such portion being herein called a
"BANK RATE ALLOCATION", and together with a CP Allocation individually
called an "ALLOCATION", and
collectively, "ALLOCATIONS"); PROVIDED, HOWEVER, that the Agent may
determine, at any time and in its sole discretion exercised in good
faith, that the Commercial Paper Rate is unavailable or otherwise not
desirable, in which case the Advances will be allocated to a Bank Rate
Allocation (unless the Default Rate is in effect). The Agent shall
provide the Borrower with reasonably prompt notice of the Allocations
made by it pursuant to this SECTION 3.3(a).
(b) The Agent, in its sole discretion exercised in good faith
after consultation with the Borrower, shall select the duration of the
initial and each subsequent Fixed Period relating to each Advance. In
selecting such Fixed Period, the Agent shall use reasonable efforts,
taking into consideration market conditions, to accommodate the
Borrower's preferences; PROVIDED, HOWEVER, that the Agent shall have the
ultimate authority to make all such selections. Unless consented to or
directed by the Agent, the aggregate number of Fixed Periods for all
Advances outstanding at any one time hereunder shall not exceed 25, it
being understood that if necessary to match the funding requirement of
the Noncommitted Lender, any Advance may be divided into portions having
different Fixed Periods.
SECTION 3.4 FEES. The Borrower agrees to pay to the Agent, on
behalf of itself, the Lenders and the Liquidity Providers, certain fees
in the amounts and on the dates set forth in the letter agreement among
CSFB, AFL and the Borrower dated as of the date hereof (as the same may
be amended, supplemented or otherwise modified, the "FEE LETTER").
SECTION 3.5 COMPUTATION OF YIELD AND FEES. All Yield and Fees
shall be computed on the basis of the actual number of days (including
the first day but excluding the last day) occurring during the period for
which such Yield or Fee is payable over a year comprised of 360 days (or,
in the case of Yield on an Advance bearing Yield at the Alternate Base
Rate, 365 days or, if appropriate, 366 days).
ARTICLE IV
REPAYMENTS AND PREPAYMENTS
SECTION 4.1 REPAYMENTS AND PREPAYMENTS. The Borrower shall repay
in full the unpaid principal amount of each Advance on the Facility
Termination Date. Prior thereto, the Borrower:
(a) may, from time to time on any Business Day, make a
prepayment, in whole or in part, of the outstanding principal amount of
any Advance; PROVIDED, HOWEVER, that
(i) all such voluntary prepayments shall require at
least two but no more than five Business Days' prior written notice to the
Agent; and
(ii) all such voluntary partial prepayments shall be in a
minimum amount of $1,000,000 and an integral multiple of $500,000;
(b) shall, on each date when any reduction in the Facility
Limit shall become
effective pursuant to SECTION 2.7, make a prepayment of the Advances in
an amount equal to the excess, if any, of the aggregate outstanding
principal amount of the Advances over the Facility Limit as so reduced;
(c) shall, immediately upon any acceleration of the maturity
date of the Advances pursuant to SECTION 14.2, repay all Advances in
full, unless, pursuant to SECTION 14.2(a), only a portion of all Advances
is so accelerated, in which event the Borrower shall repay the
accelerated portion of the Advances;
(d) shall, on the date the Borrower receives any proceeds from
any Take-Out Securitization (after deducting all costs and expenses of
such Take-Out Securitization), make a prepayment of the Advances in an
amount substantially equal to such net proceeds or, if less, the total
outstanding amount of Advances; and
(e) shall prepay the Advances in full (in the manner set forth
in SECTION 4.1(a)) in order to comply with the Clean-Up Requirement
during each Clean-Up Period.
Each such prepayment or payment shall be subject to the
payment of any amounts required by SECTION 6.3 resulting from a
prepayment or payment of an Advance prior to the end of the Fixed Period
with respect thereto.
ARTICLE V
PAYMENTS; TAXES
SECTION 5.1 MAKING OF PAYMENTS; TAXES.
(a) Subject to, and in accordance with, the provisions of the
Collateral Agent Agreement, all payments of principal of, or Yield on,
the Advances and of all Fees and other amounts shall be made by the
Borrower no later than 2:00 p.m., New York time, on the day when due in
lawful money of the United States of America in immediately available
funds to the Agent (ABA #0260-0917-9), at its special account (account
number ▇▇▇▇▇▇▇▇) maintained at the office of CSFB at Eleven Madison
Avenue, New York, New York or such other account as the Agent shall
designate in writing to the Borrower and the Collateral Agent (the
"AGENT'S ACCOUNT"). Funds received by the Agent after 2:00 p.m., New
York time, on the date when due, will be deemed to have been received by
the Agent on its next following Business Day.
(b) All payments described in SECTION 5.1(a) and all other
payments made by or on behalf of the Borrower, AFL or the Servicer to the
Agent for the benefit of itself or the Lenders or to any other Affected
Person under this Agreement and any other Transaction Document shall be
made free and clear of, and without deduction or withholding for or on
account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any
Official Body (EXCLUDING (i) taxes imposed on the net income of the Agent
or such other Affected Person, however denominated, and (ii) franchise
taxes
imposed on the net income of the Agent or such other Affected Person in
each case imposed: (1) by the United States or any political subdivision
or taxing authority thereof or therein; (2) by any jurisdiction under the
laws of which the Agent or such Affected Person or its applicable lending
office is organized or located, managed or controlled or in which its
principal office is located or any political subdivision or taxing
authority thereof or therein; or (3) by reason of any connection between
the jurisdiction imposing such tax and the Agent, such Affected Person or
such lending office other than a connection arising solely from this
Agreement or any other Transaction Document or any transaction hereunder
or thereunder) (all such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, collectively or individually,
"TAXES"). If any such Taxes are required to be withheld from any amounts
payable to the Agent or any other Affected Person hereunder or under any
other Transaction Document, the amounts so payable to the Agent or such
Affected Person shall be increased to the extent necessary to yield to
the Agent or such Affected Person (after payment of all Taxes) all
amounts payable hereunder or thereunder at the rates or in the amounts
specified in this Agreement and the other Transaction Documents. The
Borrower (or the party required to "gross-up" the applicable payment)
shall indemnify the Agent or any such Affected Person for the full amount
of any such Taxes on the Settlement Date occurring after the date of
written demand therefor by the Agent; PROVIDED that no Person shall be
indemnified pursuant to this SECTION 5.1(b) to the extent the reason for
such indemnification relates to, or arises from, the failure by such
Person to comply with the provisions of SECTION 5.1(c).
(c) Each Affected Person that is not incorporated under the
laws of the United States of America or a state thereof or the District
of Columbia shall:
(i) prior to becoming a party to any Transaction
Document, deliver to the Borrower and the Agent (A) two duly completed copies of
IRS Form 1001 or Form 4224, or successor applicable form, as the case may be,
and (B) an IRS Form W-8 or W-9, or successor applicable form, as the case may
be;
(ii) deliver to the Borrower and the Agent two (2)
further copies of any such form or certification on or before the date that any
such form or certification expires or becomes obsolete and after the occurrence
of any event requiring a change in the most recent form previously delivered by
it to the Borrower and the Agent; and
(iii) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be requested by the
Borrower or the Agent;
UNLESS, in any such case, an event (including, without limitation, any
change in treaty, law or regulation) has occurred after the Closing Date
and prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent
such Affected Person from duly completing and delivering any such form
with respect to it, and such Affected Person so advises the Borrower and
the Agent. Each such Affected Person so organized shall certify (i) in
the case of an IRS Form 1001 or IRS Form 4224, that it is entitled to
receive payments under the this Agreement and the other Transaction
Documents without deduction or withholding of any United States federal
income taxes and (ii) in the case of an IRS Form W-8 or IRS Form W-9,
that it is entitled to an exemption from United States backup withholding
tax. Each Person that desires to become an additional party to a
Noncommitted Lender Liquidity Arrangement, shall prior to the
effectiveness of such addition, be required to provide all of the forms
and statements required pursuant to this SECTION 5.1(c).
SECTION 5.2 APPLICATION OF CERTAIN PAYMENTS. Each payment of
principal of the Advances shall be applied to such Advances as the
Borrower shall direct or, in the absence of such notice or during the
existence of a Facility Termination Event or after the Facility
Termination Date, as the Agent shall determine, in its discretion.
SECTION 5.3 DUE DATE EXTENSION. If any payment of principal or
Yield with respect to any Advance falls due on a day which is not a
Business Day, then such due date shall be extended to the next following
Business Day, and additional Yield shall accrue and be payable for the
period of such extension at the rate applicable to such Advance.
ARTICLE VI
INCREASED COSTS, ETC.
SECTION 6.1 INCREASED COSTS.
(a) If due to the introduction of or any change in or in the
interpretation of any law or regulation occurring or issued after the
date hereof, the Agent, any Lender or other Investor, any Liquidity
Provider, any Participant, or any of their respective Affiliates (each an
"AFFECTED PERSON") determines that compliance with any law or regulation
or any guideline or request from any central bank or other Official Body
(whether or not having the force of law) affects or would affect the
amount of capital required or expected to be maintained by such Affected
Person and such Affected Person determines that the amount of such
capital is increased by or based upon the existence of its obligations or
commitments hereunder or with respect hereto or to the funding thereof
and other obligations or commitments of the same type, THEN, upon demand
by such Affected Person (with a copy to the Agent) (which demand shall be
accompanied by a statement setting forth the basis for the calculations
of the amount being claimed), the Borrower shall immediately pay to the
Agent, for the account of such Affected Person (as a third-party
beneficiary), from time to time as specified by such Affected Person,
additional amounts sufficient to compensate such Affected Person in the
light of such circumstances, to the extent that such Affected Person
reasonably determines such increase in capital to be allocable to the
existence of any of such obligations, commitments or fundings. Such
written statement shall, in the absence of manifest error, be rebuttably
presumptive evidence of the subject matter thereof. Any Affected Person
claiming any additional amounts payable pursuant to this SECTION 6.1(a)
agrees to use reasonable efforts (consistent with legal and regulatory
restrictions) to designate a different office or branch of such Affected
Person as its lending office if the making of such a designation would
avoid the need for, or reduce the amount of, any such additional amounts
and would not, in the reasonable judgment of such Affected Person, be
otherwise disadvantageous to such Affected Person.
(b) If, due to either (i) the introduction of or any change
(other than any change by way of imposition or increase of reserve
requirements referred to in SECTION 6.2) in or in the interpretation of
any law or regulation or (ii) compliance with any guideline or request
from any central bank or other Official Body (whether or not having the
force of law) issued after the date hereof, there shall be any increase
in the cost to a Lender of agreeing to make Advances in respect of which
Yield is computed by reference to the Eurodollar Rate, THEN, upon demand
by such Lender (with a copy to the Agent) (which demand shall be
accompanied by a statement setting forth the basis for the amount being
claimed), the Borrower shall immediately pay to the Agent, for the
account of such Lender (as a third-party beneficiary), from time to time
as specified by such Lender, additional amounts sufficient to compensate
such Lender for such increased costs. Such written statement shall, in
the absence of manifest error, be rebuttably presumptive evidence of the
subject matter thereof. Any Affected Person claiming any additional
amounts payable pursuant to this SECTION 6.1(b) agrees to use reasonable
efforts (consistent with legal and regulatory restrictions) to designate
a different office or branch of such Affected Person as its lending
office if the making of such a designation would avoid the need for, or
reduce the amount of, any such additional amounts and would not, in the
reasonable judgment of such Affected Person, be otherwise disadvantageous
to such Affected Person.
SECTION 6.2 ADDITIONAL YIELD ON ADVANCES BEARING A EURODOLLAR
RATE. The Borrower shall pay to any Lender, so long as such Lender shall
be required under regulations of the Board of Governors of the Federal
Reserve System to maintain reserves with respect to liabilities or assets
consisting of or including Eurocurrency liabilities, additional Yield on
the unpaid Advances of such Lender during each Fixed Period in respect of
which Yield is computed by reference to the Eurodollar Rate, for such
Fixed Period, at a rate per annum equal at all times during such Fixed
Period to the remainder obtained by subtracting (i) the Eurodollar Rate
for such Fixed Period from (ii) the rate obtained by dividing such
Eurodollar Rate referred to in clause (i) above by that percentage equal
to 100% MINUS the Eurodollar Rate Reserve Percentage of such Lender for
such Fixed Period, payable on each date on which Yield is payable on such
Advances. Such additional Yield shall be determined by such Lender and
notice thereof (accompanied by a statement setting forth the basis for
the amount being claimed) given to the Borrower through the Agent within
30 days after any Yield payment is made with respect to which such
additional Yield is requested. Such written statement shall, in the
absence of manifest error, be rebuttably presumptive evidence of the
subject matter thereof. Any Affected Person claiming any additional
amounts payable pursuant to this SECTION 6.2 agrees to use reasonable
efforts (consistent with legal and regulatory restrictions) to designate
a different office or branch of such Affected Person as its lending
office if the making of such a designation would avoid the need for, or
reduce the amount of, any such additional amounts and would not, in the
reasonable judgment of such Affected Person, be otherwise disadvantageous
to such Affected Person.
SECTION 6.3 FUNDING LOSSES. The Borrower hereby agrees that upon
demand by any Affected Person (which demand shall be accompanied by a
statement setting forth the basis for the calculations of the amount
being claimed) the Borrower will indemnify such Affected Person against
any net loss or expense which such Affected Person may sustain or
incur (including, without limitation, any net loss or expense incurred by
reason of or resulting from interest to accrue on the related commercial
paper after the date of any payment or prepayment of an Advance or from
the liquidation or reemployment of deposits or other funds acquired by
such Affected Person to fund or maintain any Advance to the Borrower), as
reasonably determined by such Affected Person, as a result of any failure
to borrow an Advance on the date specified therefor in an Advance Request
(other than due to a default by a Lender) or as a result of any payment
or prepayment (including any mandatory prepayment) of any Advance on a
date other than the last day of the Fixed Period for such Advance. Such
written statement shall, in the absence of manifest error, be rebuttably
presumptive evidence of the subject matter thereof.
SECTION 6.4 REPLACEMENT OF AFFECTED PERSON. Upon the receipt by
the Borrower of a claim for reimbursement or compensation under SECTION
6.1 OR 6.2 hereof by an Affected Person, if payment thereof shall not be
waived by such Affected Person, the Borrower may (a) request such
Affected Person or the Lender that has assigned an interest in its
Advances to such Affected Person to use reasonable efforts to assist the
Borrower in its attempt to obtain a replacement bank, financial
institution or Structured Lender, as applicable, satisfactory to the
Borrower (in the case of a replacement Lender) and the Agent (which
consent shall not be unreasonably withheld), to acquire and assume all or
a ratable part of such Affected Person's commitment to make Advances,
Advances, or interests therein (a "REPLACEMENT PERSON"), or (b) request
one or more of the other Lenders or Investors to acquire and assume all
or a part of such Affected Person's commitment to make Advances, Advances
or interests therein. Upon notice from the Borrower, such Affected
Person shall, or the Lender that has assigned an interest in its Advances
to such Affected Person shall cause such Affected Person to, assign,
without recourse, its commitment to make Advances, Advances or interests
therein and its other rights and obligations (if any) hereunder, or a
ratable share thereof, to the Replacement Person or Replacement Persons
designated by the Borrower and consented to by the Agent for a purchase
price equal to the sum of the principal amount of the Advances or
interests therein so assigned, all accrued and unpaid Yield thereon and
any other amounts (including Fees and any amounts owing under this
ARTICLE VI) to which such Affected Person is entitled hereunder;
PROVIDED, that the Borrower shall provide such Affected Person with an
Officer's Certificate stating that such Replacement Person has advised
the Borrower that it is not subject to, or has agreed not to seek, such
increased amount.
ARTICLE VII
EFFECTIVENESS; CONDITIONS TO ADVANCES
SECTION 7.1 EFFECTIVENESS. This Agreement shall become effective
on the first day (the "EFFECTIVE DATE") on which the Agent, on behalf of
the Lenders, shall have received the following, each in form and
substance satisfactory to the Agent, PROVIDED that the Effective Date may
not occur later than October 31, 1998 without the prior written consent
of the Agent and the Lenders:
(a) AGREEMENT. This Agreement and the Joinder Supplement
executed by each party thereto;
(b) RESOLUTIONS. A copy of the resolutions of the Board of
Directors of each of the Borrower and AFL approving the Transaction
Documents to be delivered by it hereunder and the transactions
contemplated hereby, certified by its Secretary or Assistant Secretary;
(c) CHARTERS. The Certificate or Articles of Incorporation of
each of Borrower and AFL certified by the Secretary of State of Delaware
and Minnesota, respectively;
(d) GOOD STANDING CERTIFICATE. Good Standing Certificates for
the Borrower issued by the Secretaries of State of Delaware and Minnesota
and a Good Standing Certificate for AFL issued by the Secretary of State
of Minnesota;
(e) INCUMBENCY. A certificate of the Secretary or Assistant
Secretary of each of the Borrower and AFL certifying (i) the names and
true signatures of the officers authorized on its behalf to sign this
Agreement and the other Transaction Documents to be delivered by it (on
which certificate the Agent and the Lenders may conclusively rely until
such time as the Agent shall receive a revised certificate meeting the
requirements of this subsection (e)) and (ii) a copy of the Borrower's
and AFL's by-laws;
(f) FILINGS. Acknowledgment copies of proper UCC-1 Financing
Statements (executed by AFL and/or Borrower, as applicable), as may be
necessary or, in the opinion of the Agent, desirable under the UCC of all
appropriate jurisdictions or any comparable law to perfect the security
interest of the Collateral Agent on behalf of the Secured Parties in all
Borrower Collateral in which an interest may be pledged hereunder;
(g) SEARCHES. Certified copies of Requests for Information or
Copies (Form UCC-11) (or a similar search report certified by a party
acceptable to the Agent), dated a date reasonably near to the Effective
Date, listing all effective financing statements which name AFL or the
Borrower (under their respective present names and any previous names) as
debtor and which are filed in the jurisdictions in which filings were
made pursuant to SECTION 7.1(f), together with copies of such financing
statements;
(h) OPINIONS. Legal opinion(s) of ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
special counsel for the Borrower and AFL, in form and substance
satisfactory to the Agent covering such matters as the Agent may
reasonably request;
(i) FEE LETTER. The Fee Letter, duly executed and delivered by
the parties thereto, and all amounts required to be paid on the Effective
Date thereunder shall have been paid;
(j) ACCOUNTS. Evidence that the Reserve Account, the
Collateral Account and the Collection Account have been established and
the Borrower shall have caused to be deposited in the Reserve Account an
amount equal to the Minimum Reserve Account Amount;
(k) TRANSACTION DOCUMENTS. Executed counterparts of each of
the other Transaction Documents, duly executed by each of the parties
thereto, and all conditions to the
effectiveness thereof set forth therein shall have been satisfied in all
respects;
(l) PROCEDURES LETTER. An "agreed upon procedures" letter
approved and accepted by the Independent Accountants, AFL and the Agent
relating to the reviews described in SECTION 8.12(b); and
(m) OTHER. Such other approvals, documents, opinions,
certificates and reports as the Agent may reasonably request.
SECTION 7.2 ALL ADVANCES. The making of each Advance is subject
to the condition that the Effective Date shall have occurred and to the
following further conditions precedent that:
(a) NO FACILITY TERMINATION EVENT, ETC. (i) No Facility
Termination Event or Unmatured Facility Termination Event has occurred
and is continuing or will result from the making of such Advance, (ii)
the representations and warranties of the Borrower contained in ARTICLE X
and the Servicer contained in SECTION 8.6(b) are true and correct as of
the date of such requested Advance, with the same effect as though made
on the date of (and after giving effect to) such Advance, and (iii) after
giving effect to such Advance, the aggregate outstanding principal
balance of the Advances hereunder will not exceed the lesser of the
Facility Limit and the Borrowing Base;
(b) ADVANCE REQUEST, ETC. The Agent shall have received the
Advance Request for such Advance in accordance with SECTION 2.2, together
with all items required to be delivered in connection therewith;
(c) FACILITY TERMINATION DATE. The Facility Termination Date
shall not have occurred;
(d) MINIMUM ADVANCE AMOUNT. The amount of such Advance is not
less than $5,000,000;
(e) COLLATERAL RECEIPT. The Agent shall have received a duly
completed and executed Collateral Receipt in respect of each Receivable
identified as an "Eligible Receivable" in the Schedule of Receivables
(or, in the case of any Advance after the initial Advance, the supplement
thereto) submitted with the Advance Request for such Advance;
(f) WEEKLY REVIEW. The Agent shall have received the results
of the most recent review required to be made by the Independent
Accountants pursuant to SECTION 8.12(b), which review shall contain no
exceptions unacceptable to the Agent in its reasonable discretion;
(g) BORROWING BASE CONFIRMATION. The Agent shall have received
a duly completed and executed certificate regarding the Borrowing Base in
the form attached hereto as EXHIBIT D (a "BORROWING BASE CONFIRMATION"),
computed as of the date of such Advance and after giving effect thereto
and to the purchase by the Borrower of any Receivables to be
purchased by it under the Purchase Agreement on such date;
(h) INTEREST RATE ▇▇▇▇▇▇. The Agent shall have received
evidence, in form and substance satisfactory to the Agent, that the
Borrower has entered into Interest Rate ▇▇▇▇▇▇ to the extent required by,
and satisfying the requirements of, SECTION 11.6 (together with an
Interest Rate Hedge Assignment Acknowledgment duly executed by the
counterparty thereto and concurrently delivered to the Agent);
(i) RESERVE ACCOUNT. After giving effect to such Advance and
the application of the proceeds thereof in accordance with SECTION 2.3,
the amount on deposit in the Reserve Account is not less than the Minimum
Reserve Account Amount;
(j) CERTIFICATES. The Agent shall have received a certificate
duly executed by a Responsible Officer of the Borrower to the effect that
the conditions set forth in SECTION 7.2(a) have been satisfied with
respect to the proposed Advances; and
(k) REPORTS. The Agent shall have received such other
approvals, documents, opinions, certificates and reports as it may
reasonably request.
ARTICLE VIII
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 8.1 DUTIES OF THE SERVICER. The Servicer is hereby
authorized to act for the Borrower and in such capacity shall manage,
service, administer and make collections on the Transferred Receivables,
and perform the other actions required by the Servicer under this
Agreement for the benefit of the Investors and other Secured Parties.
The Servicer agrees that its servicing of the Transferred Receivables
shall be carried out in accordance with customary and usual procedures of
institutions which service motor vehicle retail installment sales
contracts and, to the extent more exacting, the degree of skill and
attention that the Servicer exercises from time to time with respect to
all comparable motor vehicle receivables that it services for itself or
others in accordance with AFL's Servicing Procedures Manual as in effect
from time to time for servicing all its other comparable motor vehicle
receivables. The Servicer's duties shall include, without limitation,
collection and posting of all payments, responding to inquiries of
Obligors on the Transferred Receivables, investigating delinquencies,
sending payment statements or payment books to Obligors, reporting any
required tax information to Obligors, policing the collateral, complying
with the terms of the Lockbox Agreement, accounting for collections and
furnishing monthly and annual statements to the Agent and the Collateral
Agent with respect to distributions, monitoring the status of Insurance
Policies with respect to the Financed Vehicles and performing the other
duties specified herein. The Servicer shall also administer and enforce
all rights and responsibilities of the holder of the Transferred
Receivables provided for in the Dealer Agreements (and shall maintain
possession of the Dealer Agreements, to the extent it is necessary to do
so), the Dealer Assignments and the Insurance Policies, to the extent
that such Dealer Agreements, Dealer Assignments and Insurance Policies
relate to the Transferred Receivables, the related Financed Vehicles or
the related Obligors.
To the extent consistent with the standards, policies and
procedures otherwise required hereby, the Servicer shall follow its
customary standards, policies, and procedures with respect to the
Transferred Receivables and shall have full power and authority, acting
alone, to do any and all things in connection with such managing,
servicing, administration and collection that it may deem necessary or
desirable. Without limiting the generality of the foregoing, the
Servicer is hereby authorized and empowered by the Borrower to execute
and deliver, on behalf of the Borrower, the Investors, the Collateral
Agent, the Custodian or any of them, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge,
and all other comparable instruments, with respect to the Transferred
Receivables and with respect to the related Financed Vehicles. The
Servicer is authorized to release Liens on Financed Vehicles in order to
collect insurance proceeds with respect thereto and to liquidate such
Financed Vehicles in accordance with its customary standards, policies
and procedures; PROVIDED, HOWEVER, that notwithstanding the foregoing,
the Servicer shall not, except pursuant to an order from a court of
competent jurisdiction, release an Obligor from payment of any unpaid
amount under any Transferred Receivable or waive the right to collect the
unpaid balance of any Transferred Receivable from the Obligor, except
that the Servicer may forego collection efforts if the amount subject to
collection is DE MINIMIS and if it would forego collection in accordance
with its customary procedures. The Servicer is hereby authorized to
commence, in its own name or in the name of the Borrower, the Collateral
Agent or the Lenders (PROVIDED that if the Servicer is acting in the name
of the Borrower, the Collateral Agent or the Lenders, the Servicer shall
have obtained the Borrower's, the Collateral Agent's and the Agent's
consent, as the case may be, which consent shall not be unreasonably
withheld), a legal proceeding to enforce a Transferred Receivable
pursuant to SECTION 8.3 or to commence or participate in any other legal
proceeding (including, without limitation, a bankruptcy proceeding)
relating to or involving a Transferred Receivable, an Obligor or a
Financed Vehicle. If the Servicer commences or participates in such a
legal proceeding in its own name, the Borrower or the Collateral Agent
(on behalf of the Secured Parties), as the case may be, shall thereupon
be deemed to have automatically assigned such Transferred Receivable to
the Servicer solely for purposes of commencing or participating in any
such proceeding as a party or claimant, and the Servicer is authorized
and empowered by the Borrower or the Collateral Agent (on behalf of the
Secured Parties), as the case may be, to execute and deliver in the
Servicer's name any notices, demands, claims, complaints, responses,
affidavits or other documents or instruments in connection with any such
proceeding. The Borrower and the Collateral Agent (on behalf of the
Secured Parties), as the case may be, shall furnish the Servicer with any
powers of attorney and other documents which the Servicer may reasonably
request in writing and which the Servicer deems necessary or appropriate
and take any other steps which the Servicer may deem necessary or
appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement.
SECTION 8.2 COLLECTION OF RECEIVABLE PAYMENTS; MODIFICATION AND
AMENDMENT OF RECEIVABLES; LOCKBOX AGREEMENTS.
(a) Consistent with the standards, policies and procedures
required by this Agreement, the Servicer shall make reasonable efforts to
collect all payments called for under
the terms and provisions of the Transferred Receivables as and when the
same shall become due, and shall follow such collection procedures as it
follows with respect to all comparable automobile receivables that it
services for itself or others and otherwise act with respect to the
Transferred Receivables, the Dealer Agreements, the Dealer Assignments
and the Insurance Policies in such manner as will, in the reasonable
judgment of the Servicer, maximize the amount to be received by the
Borrower and the Secured Parties with respect thereto. The Servicer is
authorized in its discretion to waive any prepayment charge, late payment
charge or any other similar fees that may be collected in the ordinary
course of servicing any Transferred Receivable.
(b) The Servicer may at any time agree to a modification or
amendment of a Transferred Receivable in order to (i) change the
Obligor's regular due date to another date within the Collection Period
in which such due date occurs, (ii) re-amortize the amount of the
scheduled payments on the Transferred Receivable following a partial
prepayment of principal or (iii) convert a Pre-Computed Receivable to a
Simple Interest Receivable.
(c) The Servicer may grant payment extensions on, or other
modifications or amendments to, a Transferred Receivable (including those
modifications permitted by SECTION 8.2(b)) in accordance with its
customary procedures if the Servicer believes in good faith that such
extension, modification or amendment is necessary to avoid a default on
such Transferred Receivable, will maximize the amount to be received by
the Borrower and the Secured Parties with respect to such Transferred
Receivable, and is otherwise in the best interests of the Borrower and
the Investors; PROVIDED, HOWEVER, that:
(i) in no event may a Transferred Receivable be extended
more than twice during any twelve month period or more than six times during the
full term of such Transferred Receivable;
(ii) any such extension shall not extend beyond 84 months
after the Facility Termination Date;
(iii) the Servicer shall not amend or modify a Transferred
Receivable (except as provided in SECTION 8.2(b) and this SECTION 8.2(c))
without the written consent of the Agent; and
(iv) the terms of each Transferred Receivable may only be
amended once.
PROVIDED, THAT any such amendment, modification or extension shall be
delivered by the Servicer to the Custodian (with a copy to the Agent)
promptly after execution thereof.
(d) The Servicer shall use its best efforts to cause Obligors
to make all payments on the Transferred Receivables, whether by check or
by direct debit of the Obligor's bank account, to be made directly to one
or more Lockbox Banks, acting as agent for the Collateral Agent (on
behalf of the Secured Parties) pursuant to a Lockbox Agreement. Amounts
received by a Lockbox Bank in respect of the Transferred Receivables may
initially be deposited into a demand deposit account maintained by the
Lockbox Bank as agent for the
Collateral Agent (on behalf of the Secured Parties) and for other owners
of automobile receivables serviced by the Servicer. The Servicer shall
use its best efforts to cause the Lockbox Banks, pursuant to the Lockbox
Agreement, to deposit all payments on the Transferred Receivables in the
Lockbox Account no later than the Business Day after receipt and shall
transfer all amounts credited to the Lockbox Account on account of such
payments to the Collection Account, no later than the second Business Day
after receipt of such payments. The Lockbox Account shall be a demand
deposit account held by the Lockbox Bank, or at the request of the Agent,
an Eligible Account satisfying clause (i) of the definition thereof.
Notwithstanding any Lockbox Agreement, or any of the
provisions of this Agreement relating to the Lockbox Agreement, the
Servicer shall remain obligated and liable to the Agent, the Collateral
Agent and the Investors for servicing and administering the Transferred
Receivables in accordance with the provisions of this Agreement without
diminution of such obligation or liability by virtue thereof.
In the event the Servicer shall for any reason no longer be
acting as such, the Backup Servicer or successor Servicer shall thereupon
assume all of the rights and, from the date of assumption, all of the
obligations of the outgoing Servicer under the Lockbox Agreement, if
applicable. The Backup Servicer or any other successor Servicer shall
not be liable for any acts, omissions or obligations of the Servicer
prior to such succession. In such event, the successor Servicer shall be
deemed to have assumed all of the outgoing Servicer's interest therein
and to have replaced the outgoing Servicer as a party to each such
Lockbox Agreement to the same extent as if such Lockbox Agreement had
been assigned to the successor Servicer, except that the outgoing
Servicer shall not thereby be relieved of any liability or obligations on
the part of the outgoing Servicer to the Lockbox Bank under such Lockbox
Agreement. The outgoing Servicer shall, upon request of the Agent, but
at the expense of the outgoing Servicer, deliver to the successor
Servicer all documents and records relating to each such agreement and an
accounting of amounts collected and held by the Lockbox Bank and
otherwise use its best efforts to effect the orderly and efficient
transfer of any Lockbox Agreement to the successor Servicer. In the
event that the Agent elects to change the identity of the Lockbox Bank,
the Servicer, at its expense, shall cause the Lockbox Bank to deliver, at
the direction of the Agent, to the Collateral Agent or a successor
Lockbox Bank all documents and records relating to the Transferred
Receivables and all amounts held (or thereafter received) by the Lockbox
Bank (together with an accounting of such amounts) and shall otherwise
use its best efforts to effect the orderly and efficient transfer of the
lockbox arrangements and the Servicer shall notify the Obligors to make
payments to the Lockbox Account established by the successor.
(e) The Servicer shall remit all payments by or on behalf of
the Obligors received directly by the Servicer to the Lockbox Account,
without deposit into any intervening account as soon as practicable, but
in no event later than the Business Day after receipt thereof.
SECTION 8.3 REALIZATION UPON RECEIVABLES.
(a) Consistent with the standards, policies and procedures
required by this Agreement, the Servicer shall use its best efforts to
repossess (or otherwise comparably convert the ownership of) and
liquidate any Financed Vehicle securing a Transferred Receivable with
respect to which the Servicer has determined that payments thereunder are
not likely to be resumed, as soon as is practicable after default on such
Transferred Receivable but in no event later than the date on which all
or any portion of a Scheduled Payment has become 91 or more days
delinquent. The Servicer is authorized to follow such customary
practices and procedures as it shall deem necessary or advisable,
consistent with the standard of care required by SECTION 8.1, which
practices and procedures may include reasonable efforts to realize upon
any recourse to Dealers, selling the related Financed Vehicle at public
or private sale, the submission of claims under an Insurance Policy and
other actions by the Servicer in order to realize upon such Transferred
Receivable. The foregoing is subject to the provision that, in any case
in which the Financed Vehicle shall have suffered damage, the Servicer
shall not expend funds in connection with any repair or towards the
repossession of such Financed Vehicle unless it shall determine in its
discretion that such repair and/or repossession shall increase the
proceeds of liquidation of the related Transferred Receivable by an
amount greater than the amount of such expenses. All Recoveries shall be
remitted directly by the Servicer to the Lockbox Account without deposit
into any intervening account as soon as practicable, but in no event
later than the Business Day after receipt thereof. The Servicer shall be
entitled to recover all reasonable expenses incurred by it in the course
of repossessing and liquidating a Financed Vehicle, but only out of the
cash proceeds of such Financed Vehicle, any deficiency obtained from the
Obligor or any amounts received from the related Dealer, which amounts
may be retained by the Servicer (and shall not be required to be
deposited in the Lockbox Account) to the extent of such expenses. The
Servicer shall pay on behalf of the Borrower any personal property taxes
assessed on repossessed Financed Vehicles; and the Servicer shall be
entitled to reimbursement of any such tax from Recoveries with respect to
the related Transferred Receivable.
(b) If the Servicer elects to commence a legal proceeding to
enforce a Dealer Agreement or Dealer Assignment, the act of commencement
shall be deemed to be an automatic assignment from the Borrower and the
Collateral Agent (on behalf of the Secured Parties) to the Servicer of
the rights under such Dealer Agreement and Dealer Assignment for purposes
of collection only. If, however, in any enforcement suit or legal
proceeding, it is held that the Servicer may not enforce a Dealer
Agreement or Dealer Assignment on the grounds that it is not a real party
in interest or a Person entitled to enforce the Dealer Agreement or
Dealer Assignment, the Borrower, at the Servicer's expense, shall take
such steps as the Servicer deems necessary to enforce the Dealer
Agreement or Dealer Assignment, including bringing suit in its name. All
amounts recovered shall be remitted directly by the Servicer to the
Lockbox Account without deposit into any intervening account as soon as
practicable, but in no event later than the Business Day after receipt
thereof.
SECTION 8.4 INSURANCE.
(a) The Servicer shall monitor the status of the Insurance
Policies in accordance with its customary servicing procedures. If the
Servicer shall determine that an Obligor has
failed to obtain or maintain a physical loss and damage insurance policy
covering the related Financed Vehicle which satisfies the conditions set
forth in subsection (v) of the definition of "Eligible Receivable"
(including during the repossession of such Financed Vehicle) the Servicer
shall enforce the rights of the holder of the Receivable thereunder to
require that the Obligor obtains such physical loss and damage insurance.
(b) The initial Servicer may, if an Obligor fails to obtain or
maintain a physical loss and damage Insurance Policy, obtain insurance
with respect to the related Financed Vehicle and advance on behalf of
such Obligor, as required under the terms of the Insurance Policy, the
premiums for such insurance (such insurance being referred to herein as
"FORCE-PLACED INSURANCE"). All policies of Force-Placed Insurance shall
be endorsed with clauses providing for loss payable to the Collateral
Agent. Any cost incurred by the Servicer in maintaining such
Force-Placed Insurance shall only be recoverable out of premiums paid by
the Obligors or Recoveries with respect to the Transferred Receivable, as
provided in paragraph (c) of this SECTION 8.4.
(c) In connection with any Force-Placed Insurance obtained
hereunder, the Servicer may, in the manner and to the extent permitted by
applicable law, require the Obligors to repay the entire premium to the
Servicer. In no event shall the Servicer include the amount of the
premium in the Amount Financed under the Receivable. For all purposes of
this Agreement, the Insurance Add-On Amount with respect to any
Receivable having Force-Placed Insurance will be treated as a separate
obligation of the Obligor and will not be added to the Principal Balance
of such Receivable, and amounts allocable thereto will not be available
in respect of the Obligations. The Servicer shall retain and separately
administer the right to receive payments from Obligors with respect to
Insurance Add-On Amounts or rebates of Force-Placed Insurance premiums.
If an Obligor makes a payment with respect to a Receivable having
Force-Placed Insurance, but the Servicer is unable to determine whether
the payment is allocable to the Receivable or to the Insurance Add-On
Amount, the payment shall be applied first to any unpaid Scheduled
Payments and then to the Insurance Add-On Amount. Recoveries on any
Receivable will be used first to pay the Principal Balance and accrued
interest on such Receivable and then to pay the related Insurance Add-On
Amount. If an Obligor under a Receivable with respect to which the
Servicer has placed Force-Placed Insurance fails to make scheduled
payments of such Insurance Add-On Amount as due, and the Servicer has
determined that eventual payment of the Insurance Add-On Amount is
unlikely, the Servicer may, but shall not be required to, purchase such
Receivable from the Borrower for the Purchase Amount on any subsequent
Distribution Date. Any such Receivable, and any Receivable with respect
to which the Servicer has placed Force-Placed Insurance which has been
paid in full (excluding any Insurance Add-On Amounts) will be assigned by
the Borrower to the Servicer.
(d) The Servicer may ▇▇▇ to enforce or collect upon the
Insurance Policies, in its own name, if possible, or as agent of the
Borrower and the Collateral Agent (on behalf of the Secured Parties). If
the Servicer elects to commence a legal proceeding to enforce an
Insurance Policy, the act of commencement shall be deemed to be an
automatic assignment of the rights of the Borrower and the Collateral
Agent (on behalf of the Secured Parties) under such Insurance Policy to
the Servicer for purposes of collection only. If, however, in
any enforcement suit or legal proceeding it is held that the Servicer may
not enforce an Insurance Policy on the grounds that it is not a real
party in interest or a holder entitled to enforce the Insurance Policy,
the Borrower shall take such steps as the Servicer deems necessary to
enforce such Insurance Policy, including bringing suit in its name.
(e) The Servicer shall maintain Collateral Insurance. Costs
incurred by the Servicer in maintaining such insurance shall be paid by
the Servicer. The Servicer will cause itself to be named as named
insured and the Collateral Agent to be named a loss payee under all such
Collateral Insurance. The Servicer may, with the consent of the Agent,
elect not to maintain such Collateral Insurance but in such event will be
obligated to indemnify the Borrower, the Collateral Agent and the Secured
Parties against any losses arising from an Obligor's failure to maintain
physical loss and damage insurance with respect to the related Financed
Vehicle.
SECTION 8.5 MAINTENANCE OF SECURITY INTERESTS IN FINANCED
VEHICLES.
(a) Consistent with its obligations under this Agreement, the
Collateral Agent Agreement and the Custodial Agreement, the Servicer
shall take such steps as are necessary to maintain perfection of the
security interest created by each Transferred Receivable in the related
Financed Vehicle on behalf of the Borrower and the Collateral Agent for
the benefit of the Secured Parties, including but not limited to
obtaining the execution by the Obligors and the recording, registering,
filing, re-recording, re-filing, and re-registering of all security
agreements, financing statements and continuation statements as are
necessary to maintain the security interest granted by the Obligors under
the Transferred Receivables. The Borrower and the Collateral Agent (on
behalf of the Secured Parties) each hereby authorizes the Servicer, and
the Servicer agrees, to take any and all steps necessary to re-perfect
such security interest on behalf of the Borrower and the Collateral Agent
(on behalf of the Secured Parties) as necessary because of the relocation
of a Financed Vehicle or for any other reason. In the event that the
assignment of a Transferred Receivable to the Borrower and the pledge
thereof to the Collateral Agent (on behalf of the Secured Parties), and
the filing of UCC financing statements all as provided herein, is
insufficient, without a notation on the related Financed Vehicle's
certificate of title, or without fulfilling any additional administrative
requirements under the laws of the state in which the Financed Vehicle is
located, to perfect a security interest in the related Financed Vehicle
in favor of the Borrower and the pledge thereof to the Collateral Agent
(on behalf of the Secured Parties), the parties hereto agree that AFL's
designation as the secured party on the certificate of title is, with
respect to each secured party, as applicable, in its capacity as agent of
the Borrower and the Secured Parties.
(b) Upon the occurrence and during the continuance of a
Facility Termination Event, the Agent may instruct the Borrower and the
Servicer to take or cause to be taken such reasonable action as may, in
the opinion of counsel to the Agent, be necessary or desirable to perfect
or re-perfect the security interests in the Financed Vehicles securing
the Transferred Receivables in the name of the Borrower and the
Collateral Agent (on behalf of the Secured Parties) (as lienholder) by
amending the title documents of such Financed Vehicles or by such other
reasonable means as may, in the opinion of counsel to the Agent, be
necessary or prudent. AFL hereby agrees to pay all expenses related to
such perfection or re-perfection
and to take all action necessary therefor. In addition, prior to the
occurrence of a Facility Termination Event, the Agent may instruct the
Borrower and the Servicer to take or cause to be taken such reasonable
action as may, in the opinion of counsel to the Agent, be necessary to
perfect or re-perfect the security interest in the Financed Vehicles
underlying the Transferred Receivables in the name of the Borrower and
the Collateral Agent (on behalf of the Secured Parties), including by
amending the title documents of such Financed Vehicles or by such other
reasonable means as may, in the opinion of counsel to the Agent, be
necessary or prudent; PROVIDED, HOWEVER, that if the Agent requests that
the title documents be amended prior to the occurrence of a Facility
Termination Event or Unmatured Facility Termination Event, the
out-of-pocket expenses of the Servicer or the Borrower in connection with
such action shall be reimbursed to the Servicer or the Borrower, as
applicable, by the Banks.
SECTION 8.6 COVENANTS, REPRESENTATIONS AND WARRANTIES OF
SERVICER. The Servicer hereby makes the following representations,
warranties and covenants to the other parties hereto on which the Lenders
shall rely in making the Advances.
(a) The Servicer covenants to the Borrower, the Agent and the
Investors as follows:
(i) LIENS IN FORCE. The Financed Vehicle securing each
Transferred Receivable shall not be released in whole or in part from the
security interest granted by such Receivable, except upon payment in full of
such Receivable or as otherwise contemplated herein;
(ii) NO IMPAIRMENT. The Servicer shall do nothing to
impair the rights of the Borrower or the Secured Parties in the Transferred
Receivables, the Dealer Agreements, the Dealer Assignments or the Insurance
Policies;
(iii) NO AMENDMENTS. The Servicer shall not extend or
otherwise amend the terms of any Transferred Receivable, except in accordance
with SECTION 8.2;
(iv) SERVICING OF RECEIVABLES. The Servicer shall
service the Transferred Receivables as required by the terms of this Agreement
and in material compliance with the current Servicing Procedures Manual for
servicing all its other comparable motor vehicle receivables and the Servicer
shall not change the manner in which it services the Receivables in any way that
can have a material adverse effect on the Transferred Receivables;
(v) COMPLIANCE WITH LAWS. The Servicer shall comply in
all material respects with the laws of each state in which a Transferred
Receivable is located, including, without limitation, all federal and state laws
regarding the collection and enforcement of consumer debt;
(vi) NOTICE OF RELOCATION. The Servicer shall give the
Agent at least 60 days prior written notice of any relocation of its principal
executive office if, as a result of such relocation, the applicable provisions
of the UCC would require the filing of any amendment of any previously filed
financing or continuation statement or of any new financing statement. The
Servicer shall at all times maintain each office from which it services the
Collateral and its principal executive office within the United States of
America;
(vii) MAINTENANCE OF COMPUTER SYSTEMS, ETC. The Servicer
shall maintain its computer systems so that, from and after the time of the
first Advance under this Agreement, the Servicer's master computer records
(including archives) that shall refer to the Collateral indicate clearly that
such Collateral is subject to first priority security interest in favor of the
Collateral Agent for the benefit of the Secured Parties. Indication of the
Collateral Agent's security interest shall be deleted from or modified on the
Servicer's computer systems when, and only when, the Collateral in question
shall have been paid in full or sold by the Borrower in accordance herewith; and
(viii) OTHER SALES, GRANTS OR TRANSFERS. If at any time
the Servicer shall propose to sell, grant a security interest in, or otherwise
transfer any interest in motor vehicle receivables to any prospective purchaser,
lender or other transferee, the Servicer shall give to such prospective
purchaser, lender, or other transferee computer tapes, records, or print-outs
(including any restored from archives) that, if they shall refer in any manner
whatsoever to any Collateral, shall indicate clearly that such Collateral is
subject to a first priority security interest in favor of the Collateral Agent
for the benefit of the Secured Parties.
(b) The Servicer represents and warrants to the Borrower, the
Agent and the Investors, as of the Closing Date and as of each Advance
Date as to itself that:
(i) ORGANIZATION AND GOOD STANDING. The Servicer has
been duly organized and is validly existing and in good standing under the laws
of the State of Minnesota or, in the case of a successor Servicer, its
jurisdiction of organization, with power, authority and legal right to own its
properties and to conduct its business as such properties are currently owned
and such business is currently conducted, and had at all relevant times, and now
has, power, authority and legal right to enter into and perform its obligations
under this Agreement and the other Transaction Documents to which it is party
(in any capacity);
(ii) DUE QUALIFICATION. The Servicer is duly qualified
to do business as a foreign corporation in good standing, and has obtained all
necessary licenses and approvals, in all jurisdictions where the failure to do
so would have a material adverse effect on its ability to perform its
obligations hereunder or under any other Transaction Document to which it is
party (in any capacity);
(iii) POWER AND AUTHORITY. The Servicer has the power and
authority to execute and deliver this Agreement and the Transaction Documents to
which it is a party (in any capacity) and to carry out its terms and their
terms, respectively, and the execution, delivery and performance of this
Agreement and the Transaction Documents to which it is a party (in any capacity)
have been duly authorized by the Servicer by all necessary corporate action;
(iv) BINDING OBLIGATION. This Agreement and the
Transaction Documents to which it is a party (in any capacity) shall constitute
legal, valid and binding obligations of the Servicer enforceable in accordance
with their respective terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, or other similar laws affecting the
enforcement of creditors' rights generally and by equitable limitations on the
availability of
specific remedies, regardless of whether such enforceability is considered in a
proceeding in equity or at law;
(v) NO VIOLATION. The consummation of the transactions
contemplated by this Agreement and the Transaction Documents to which it is a
party (in any capacity), and the fulfillment of the terms of this Agreement and
the Transaction Documents to which it is a party (in any capacity), shall not
conflict with, result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time) a default under, the
certificate or articles of incorporation or bylaws of the Servicer, or any
indenture, agreement, mortgage, deed of trust or other instrument to which the
Servicer is a party or by which it is bound or any of its properties are
subject, or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement, mortgage,
deed of trust or other instrument, other than this Agreement, or violate any
law, order, rule or regulation applicable to the Servicer of any court other
Official Body, having jurisdiction over the Servicer or any of its properties,
or in any way materially adversely affect the interest of the Borrower, the
Collateral Agent or the Secured Parties in any Transferred Receivable, or affect
the Servicer's ability to perform its obligations under this Agreement;
(vi) NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the Servicer's knowledge, threatened against the
Servicer, before any court or other Official Body having jurisdiction over the
Servicer or its properties (A) asserting the invalidity of this Agreement or any
of the Transaction Documents, (B) seeking to prevent the consummation of any of
the transactions contemplated by this Agreement or any of the Transaction
Documents, (C) seeking any determination or ruling that might materially and
adversely affect the performance by the Servicer of its obligations under, or
the validity or enforceability of, this Agreement or any of the Transaction
Documents, or (D) that could have a material adverse effect on the Transferred
Receivables;
(vii) YEAR 2000 COMPLIANCE. The Servicer and its
Subsidiaries have (i) undertaken a detailed review and assessment of all areas
within its business and operations (including its servicing operations) that
could be adversely affected by the failure of the Servicer or its Subsidiaries
to be Year 2000 Compliant on a timely basis, (ii) developed a detailed plan and
timetable for becoming Year 2000 Compliant on a timely basis, and
(iii) implemented and will implement that plan in accordance with that timetable
in all material respects;
(viii) NO CONSENTS. The Servicer is not required to obtain
the consent of any other Person or any consent, license, approval or
authorization of, or registration or declaration with, any Official Body in
connection with the execution, delivery, performance, validity or enforceability
of this Agreement and the Transaction Documents to which it is party (in any
capacity); and
(ix) CHIEF EXECUTIVE OFFICE. The chief executive office
of AFL is located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
SECTION 8.7 PURCHASE OF RECEIVABLES UPON BREACH OF COVENANT OR
REPRESENTATION AND WARRANTY. The Borrower or the Servicer, as the case
may be, shall inform the other
parties to this Agreement promptly, in writing, upon the discovery of any
breach of the Servicer's representations and warranties and covenants
pursuant to SECTION 8.5(a) or 8.6; PROVIDED, HOWEVER, that the failure to
give any such notice shall not derogate from any obligation of the
Servicer hereunder to repurchase any Transferred Receivable; PROVIDED,
FURTHER that, the Backup Servicer shall have no duty to inquire into or
to investigate the breach of any such representations and warranties and
covenants. Unless the breach shall have been cured by the last day of
the first full calendar month following the discovery by or notice to the
Servicer of the breach, the Servicer shall have an obligation, and the
Borrower and the Agent shall (PROVIDED that it either has made such
discovery or has received such notice thereof) enforce such obligation of
the Servicer, to repurchase any Transferred Receivable materially and
adversely affected by the breach. The Borrower shall notify the Agent
promptly, in writing, of any failure by the Servicer to so repurchase any
Transferred Receivable. In consideration of the purchase of the
Transferred Receivable, the Servicer shall remit the Purchase Amount to
the Collection Account on the date of such repurchase.
In addition to the foregoing and notwithstanding whether
the related Transferred Receivable shall have been purchased by the
Servicer, the Servicer shall indemnify the Backup Servicer, the
Collateral Agent, the Borrower, the Agent and the other Secured Parties
against all costs, expenses, losses, damages, claims and liabilities,
including reasonable fees and expenses of counsel, which may be asserted
against or incurred by any of them as a result of third party claims
arising out of the events or facts giving rise to a breach of the
covenants or representations and warranties set forth in SECTION 8.5(a)
or 8.6.
SECTION 8.8 TOTAL SERVICING FEE; PAYMENT OF CERTAIN EXPENSES BY
SERVICER.
(a) Subject to, and in accordance with, the provisions of the
Collateral Agent Agreement, on each Distribution Date, the Servicer shall
be entitled to receive out of the Collection Account the Servicing Fee
for the related Collection Period.
(b) The Servicer shall be required to pay all expenses incurred
by it in connection with its activities under this Agreement (including
taxes imposed on the Servicer). The Servicer shall be liable for the
fees and expenses of the Backup Servicer, the Lockbox Bank (and any fees
under the Lockbox Agreement), the Custodian, the Collateral Agent and the
Independent Accountants, to the extent such amounts have not been paid in
accordance with the Collateral Agent Agreement.
SECTION 8.9 SERVICER'S CERTIFICATE.
(a) No later than 5:00 p.m., New York City time, on each
Determination Date, the Servicer shall deliver to the Backup Servicer,
the Collateral Agent, the Borrower and the Agent a Servicer's Certificate
executed by a Responsible Officer of the Servicer in the form attached
hereto as EXHIBIT E. Transferred Receivables purchased by the Servicer
or AFL and each Transferred Receivable which became a Warranty Receivable
or a Defaulted Receivable or a Delinquent Receivable or which was paid in
full during the related Collection Period shall be identified by account
number (as set forth in the Schedule of Receivables).
(b) In addition to the information required by SECTION 8.9(a),
the Servicer shall include in the copy of the Servicer's Certificate
delivered to the Borrower and the Agent (i) whether any Facility
Termination Event or Unmatured Facility Termination Event has occurred as
of such Determination Date, (ii) whether any Facility Termination Event
or Unmatured Facility Termination Event that may have occurred as of a
prior Determination Date is deemed cured as of such Determination Date,
(iii) the Delinquency Ratio and Portfolio Net Loss Ratio for such
Determination Date and the Servicer Delinquency Ratio, Monthly Excess
Spread Percentage and Net Yield as of the last day of the preceding
Collection Period, (iv) whether a Level I-VI Trigger Event has occurred
(specifying same) and the Stated Percentage and Required Reserve Account
Amount for such Determination Date and (v) the Borrowing Base, Required
Holdback and Deficiency Percentage for such Determination Date.
SECTION 8.10 ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF
SERVICER TERMINATION EVENT.
(a) The Servicer shall deliver to the Backup Servicer, the
Borrower, the Collateral Agent and the Agent, on or before March 31 (or
90 days after the end of the Servicer's fiscal year, if other than
December 31) of each year, beginning on March 31, 1999, an Officer's
Certificate, dated as of December 31 (or other applicable date) of the
immediately preceding year, stating that (i) a review of the activities
of the Servicer during the preceding 12-month period (or such other
period as shall have elapsed from the Closing Date to the date of the
first such certificate) and of its performance under this Agreement has
been made under such officer's supervision, and (ii) to such officer's
knowledge, based on such review, the Servicer has fulfilled all its
obligations under this Agreement throughout such period, or, if there has
been a default in the fulfillment of any such obligation, specifying each
such default known to such officer and the nature and status thereof.
(b) The Borrower or the Servicer shall deliver to the Backup
Servicer, the Borrower, the Collateral Agent and the Agent, promptly
after having obtained knowledge thereof, but in no event later than two
Business Days thereafter, written notice in an Officer's Certificate of
any event which is, or with the giving of notice or lapse of time, or
both, would become a Servicer Termination Event under SECTION 13.1.
SECTION 8.11 ANNUAL INDEPENDENT ACCOUNTANTS' REPORT
(a) The Servicer shall cause a firm of nationally recognized
independent certified public accountants (the "INDEPENDENT ACCOUNTANTS"),
who may also render other services to the Servicer or to AFL, to deliver
to the Servicer, the Backup Servicer, the Borrower, the Collateral Agent
and the Agent, on or before March 31 (or 90 days after the end of the
Servicer's fiscal year, if other than December 31) of each year,
beginning on March 31, 1999, with respect to the twelve months ended the
immediately preceding December 31 (or other applicable date) (or such
other period as shall have elapsed from the Closing Date to the date of
such certificate), a statement (the "ACCOUNTANTS' REPORT") addressed to
the Servicer, the Collateral Agent and the Agent, to the effect that
such firm has audited the financial statements of the Servicer and issued
its report thereon and that (i) such audit was made in
accordance with generally accepted auditing standards, and accordingly
included such tests of the accounting records and such other auditing
procedures as such firm considered necessary in the circumstances,
(ii) certain agreed upon procedures were applied to three randomly
selected Servicer's Certificates (which procedures shall be submitted for
approval to the Agent, which approval shall not be unreasonably withheld)
and (iii) the firm is independent of AFL and the Servicer within the
meaning of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
(b) The Servicer shall deliver a copy of the Accountants'
Report, within 15 days of receipt, to the Agent and the Backup Servicer.
(c) In the event such Independent Accountants require the
Collateral Agent or the Backup Servicer to agree to the procedures to be
performed by such firm in any of the reports required to be prepared
pursuant to this SECTION 8.11, the Servicer shall direct the Collateral
Agent or the Backup Servicer, in writing to so agree; it being understood
and agreed that the Collateral Agent and/or the Backup Servicer will
deliver such letter of agreement in conclusive reliance upon the
direction of the Servicer, and neither the Collateral Agent nor the
Backup Servicer has made any independent inquiry or investigation as to,
and shall have no obligation or liability in respect of, the sufficiency,
validity or correctness of such procedures.
SECTION 8.12 ACCESS TO CERTAIN DOCUMENTATION; WEEKLY REVIEW.
(a) The Servicer shall provide to representatives of the Backup
Servicer, the Borrower, the Collateral Agent and the Agent reasonable
access to the documentation regarding the Transferred Receivables
including, without limitation, copies of the Dealer Underwriting Guides
and the Servicing Procedures Manual. Nothing in this SECTION 8.12 shall
derogate from the obligation of the Servicer to observe any applicable
law prohibiting disclosure of information regarding the Obligors, and the
failure of the Servicer to provide access as provided in this SECTION
8.12 as a result of such obligation shall not constitute a breach of this
SECTION 8.12.
(b) The Agent shall have the right to direct Independent
Accountants approved by the Agent to review information regarding the
Transferred Receivables in accordance with the agreed upon procedures
described in SECTION 7.1(l) or otherwise approved by the Agent. The
reviews will be performed weekly (commencing with the week following the
date of the initial Advance); PROVIDED that if following the date of the
most recent review under this SECTION 8.12(b) new Advances in excess of
$50,000,000 are made, the Agent may direct the Independent Accountants to
make an interim review under this SECTION 8.12(b) prior to the due date
of the next weekly review. The fees and expenses of the Independent
Accountants shall be paid by the Servicer.
SECTION 8.13 MONTHLY TAPE. On or before the third Business Day,
but in no event later than the fifth calendar day, of each month, the
Servicer will deliver to the Backup Servicer the Monthly Tape in a format
acceptable to the Backup Servicer containing the information with respect
to the Transferred Receivables as of the last day of the immediately
preceding calendar month necessary for preparation of the Servicer's
Certificate relating to the immediately succeeding Determination Date .
Based solely on the information contained in the Monthly Tape and the
Servicer's Certificate, the Backup Servicer shall verify the Aggregate
Outstanding Principal Balance of the Total Receivables Pool. The Backup
Servicer shall recalculate the information contained in the Servicer's
Certificate delivered by the Servicer, and shall certify to the Agent
that it is correct on its face or shall notify the Servicer and the
Agent of any discrepancies, in each case, on or before the second
Business Day following the Determination Date. In the event that the
Backup Servicer reports any discrepancies, the Servicer and the Backup
Servicer shall attempt to reconcile such discrepancies prior to the
related Distribution Date, but in the absence of a reconciliation, the
Servicer's Certificate shall control for the purpose of calculations and
distributions with respect to the related Distribution Date. In the
event that the Backup Servicer and the Servicer are unable to reconcile
discrepancies with respect to a Servicer's Certificate by the related
Distribution Date, the Servicer shall cause the Independent Accountants,
at the Servicer's expense, to audit the Servicer's Certificate and, prior
to the third Business Day, but in no event later than the fifth calendar
day, of the following month, reconcile the discrepancies. The effect, if
any, of such reconciliation shall be reflected in the Servicer's
Certificate for such next succeeding Determination Date.
In addition, the Servicer shall, if so requested by the
Agent, deliver to the Backup Servicer its Collection Records and its
Monthly Records as soon as practicable and in any event within one
Business Day after demand therefor (which demand may be made at any time
after the occurrence of a Facility Termination Event or a Servicer
Termination Event or the occurrence of any event which, if uncured, with
lapse of time or notice or lapse of time and notice, would constitute a
Facility Termination Event or a Servicer Termination Event) and a
computer tape containing as of the close of business on the date of
demand all of the data maintained by the Servicer in computer format in
connection with servicing the Transferred Receivables.
Other than the duties specifically set forth in this
Agreement, the Backup Servicer shall have no obligations hereunder,
including, without limitation, to supervise, verify, monitor or
administer the performance of the Servicer. The Backup Servicer shall
have no liability for any actions taken or omitted by the Servicer. The
duties and obligations of the Backup Servicer shall be determined solely
by the express provisions of this Agreement and no implied covenants or
obligations shall be read into this Agreement against the Backup
Servicer.
SECTION 8.14 RETENTION OF SERVICER. AFL hereby covenants and
agrees to act as such under this Agreement for an initial term,
commencing on the Closing Date and ending on December 31, 1998, which
term shall be extendible by the Agent for successive quarterly terms
ending on each successive March 31, June 30, September 30 and December 31
(or, pursuant to revocable written standing instructions from time to
time to the Servicer, for any specified number of terms greater than
one). Each such notice (including each notice pursuant to standing
instructions, which shall be deemed delivered at the end of successive
quarterly terms for so long as such instructions are in effect) (a
"SERVICER EXTENSION NOTICE") shall be delivered by the Agent to the
Servicer. AFL hereby agrees that, as of the date hereof
and upon its receipt of any such Servicer Extension Notice, AFL shall
become bound, for the initial term beginning on the Closing Date and for
the duration of the term covered by such notice, to continue as the
Servicer subject to and in accordance with the other provisions of this
Agreement.
SECTION 8.15 FIDELITY BOND. The Servicer shall maintain a
fidelity bond in such form and amount as is customary for entities acting
as custodian of funds and documents in respect of consumer contracts on
behalf of institutional investors.
SECTION 8.16 INSURANCE. The Servicer shall maintain customary
amounts of insurance coverage, including, without limitation, commercial
crime coverage, employee dishonesty coverage, commercial auto coverage,
valuable papers and records coverage, coverage for fire, theft, workers
compensation, public liability, property damage and errors and omissions
coverage. The Servicer shall be entitled to self-insure with respect to
such insurance so long as the long-term unsecured debt obligations of the
Servicer are rated in the second highest long-term debt category by each
of the Rating Agencies.
SECTION 8.17 ACCOUNTS.
(a) The Servicer shall establish the Collection Account in the
name of the Collateral Agent for the benefit of the Secured Parties. The
Collection Account shall be an Eligible Account and initially shall be a
segregated trust account established and maintained with the Collateral
Agent. Amounts on deposit in the Collection Account shall be invested by
the Collateral Agent in Permitted Investments pursuant to written
instructions from the Servicer. If the Collateral Agent does not receive
written direction from the Servicer any such amounts on deposit shall be
invested in the investment described in subclause (f) of the definition
of Permitted Investments.
(b) The Servicer shall establish the Reserve Account in the
name of the Collateral Agent for the benefit of the Secured Parties. The
Reserve Account shall be an Eligible Account and initially shall be a
segregated trust account established and maintained with the Collateral
Agent. Amounts on deposit in the Reserve Account shall be invested by
the Collateral Agent in Permitted Investments pursuant to written
instructions from the Servicer. If the Collateral Agent does not receive
written direction from the Servicer any such amounts on deposit shall be
invested in the investment described in subclause (f) of the definition
of Permitted Investments.
(c) The Servicer shall establish the Collateral Account in the
name of the Collateral Agent for the benefit of the Secured Parties. The
Collateral Account shall be an Eligible Account and initially shall be a
segregated trust account established and maintained with the Collateral
Agent. The Collateral Agent shall deposit to the Collateral Account any
amount delivered to it by the Borrower and designated in writing to be
deposited in the Collateral Account.
SECTION 8.18 COLLECTIONS.
(a) Pursuant to the Lockbox Agreement, the Lockbox Bank shall
remit to the Collection Account within two Business Days of receipt
thereof (i) all payments by or on behalf of the Obligors and (ii) all
Recoveries, each as collected during the Collection Period. In addition,
the Servicer shall remit, or cause to be remitted, all payments by or on
behalf of the Obligors received by the Servicer or the Borrower with
respect to the Transferred Receivables, all Recoveries, the purchase
price paid by AFL or the Servicer with respect to any Transferred
Receivables and all payments made to the Borrower under the Interest Rate
▇▇▇▇▇▇, no later than the Business Day following receipt directly
(without deposit into any intervening account) into the Collection
Account.
(b) The Servicer will be entitled to be reimbursed from amounts
on deposit in the Collection Account with respect to a Collection Period
for amounts previously deposited in the Collection Account but later
determined by the Servicer to have resulted from mistaken deposits or
postings or checks returned for insufficient funds. The amount to be
reimbursed hereunder shall be paid to the Servicer on the related
Distribution Date upon certification by the Servicer of such amounts and
the provision of such information to the Collateral Agent and the Agent
as may be necessary in the opinion of the Agent to verify the accuracy of
such certification. In the event that the Agent has not received
evidence satisfactory to it of the Servicer's entitlement to
reimbursement pursuant to this SECTION 8.18, the Agent shall give the
Collateral Agent written notice to such effect, following receipt of
which the Collateral Agent shall not make a distribution to the Servicer
in respect of such amount, or if the Servicer prior thereto has been
reimbursed, the Collateral Agent shall withhold such amounts from amounts
otherwise distributable to the Servicer on the next succeeding
Distribution Date.
SECTION 8.19 APPLICATION OF COLLECTIONS. For the purposes of
this Agreement, all collections for a Collection Period shall be applied
by the Servicer with respect to each Transferred Receivable as follows:
(i) in the case of a Pre-Computed Receivable, FIRST, with respect to the
Scheduled Payment of such Pre-Computed Receivable, to interest and
principal in accordance with the actuarial method, and, SECOND, to any
late fees accrued with respect to such Pre-Computed Receivable, and
(ii) in the case of a Simple Interest Receivable, to interest and
principal in accordance with the Simple Interest Method. With respect to
Simple Interest Receivables, any prepayment of principal during each
Collection Period shall be immediately applied to reduce the Principal
Balance of such Receivable during such Collection Period.
ARTICLE IX
GRANT OF SECURITY INTERESTS
SECTION 9.1 BORROWER'S GRANT OF SECURITY INTEREST. As security
for the prompt payment or performance in full when due, whether at stated
maturity, by acceleration or otherwise, of all Obligations, the Borrower
hereby assigns and pledges to the Collateral Agent, for the benefit of
the Secured Parties, and grants to the Collateral Agent, for the benefit
of the Secured Parties, a security interest in and lien upon, all of the
Borrower's right, title and interest in and to the following, in each
case whether now or hereafter existing or in which Borrower now has or
hereafter acquires an interest and wherever the same may be
located (collectively, the "BORROWER COLLATERAL"):
(a) all Collateral;
(b) the Purchase Agreement, each Lockbox Agreement and all other
documents now or hereafter in effect relating to the purchase, servicing or
processing of Transferred Receivables (collectively, the "BORROWER ASSIGNED
AGREEMENTS"), including (i) all rights of the Borrower to receive moneys due and
to become due under or pursuant to the Borrower Assigned Agreements, (ii) all
rights of the Borrower to receive proceeds of any insurance, indemnity, warranty
or guaranty with respect to the Borrower Assigned Agreements, (iii) the
Borrower's right of foreclosure as lienholder of the vehicles underlying the
Receivables, (iv) claims of the Borrower for damages arising out of or for
breach of or default under the Borrower Assigned Agreements, and (v) the right
of the Borrower to amend, waive or terminate the Borrower Assigned Agreements,
to perform under the Borrower Assigned Agreements and to compel performance and
otherwise exercise all remedies and rights under the Borrower Assigned
Agreements; PROVIDED, that to the extent the foregoing applies to the
Transferred Receivables as well as other receivables originated and/or serviced
by AFL, the foregoing shall apply only to the Transferred Receivables;
(c) all of the following (the "BORROWER ACCOUNT COLLATERAL"):
(i) the Lockbox Account and all funds held in the
Lockbox Account and all certificates and instruments, if any, from time to time
representing or evidencing the Lockbox Account or such funds,
(ii) the Collection Account, all funds held in the
Collection Account, and all certificates and instruments, if any, from time to
time representing or evidencing the Collection Account or such funds,
(iii) the Reserve Account, all funds held in the Reserve
Account, and all certificates and instruments, if any, from time to time
representing or evidencing the Reserve Account or such funds,
(iv) the Collateral Account, all funds held in the
Collateral Account, and all certificates and instruments, if any, from time to
time evidencing the Collateral Account or such funds,
(v) all investments from time to time of amounts in the
Collection Account, Reserve Account and Collateral Account, and all certificates
and instruments, if any, from time to time representing or evidencing such
investments,
(vi) all notes, certificates of deposit and other
instruments from time to time delivered to or otherwise possessed by the
Collateral Agent or any Secured Party or any assignee or agent on behalf of the
Collateral Agent or any Secured Party in substitution for or in addition to any
of the then existing Borrower Account Collateral, and
(vii) all interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any and all of the then existing Borrower Account
Collateral;
(d) each Interest Rate Hedge including all rights of the Borrower to
receive moneys due and to become due thereunder;
(e) all additional property that may from time to time hereafter be
granted and pledged by the Borrower or by anyone on its behalf under this
Agreement, including the deposit with the Collateral Agent or the Agent of
additional moneys by the Borrower; and
(f) all proceeds, accessions, substitutions, rents, Recoveries and
profits of, or with respect to, any and all of the foregoing Borrower Collateral
(including proceeds that constitute property of the types described in SECTIONS
9.1(a) through (e) above) and, to the extent not otherwise included, all
payments under insurance (whether or not the Collateral Agent or a Secured Party
or any assignee or agent on behalf of the Collateral Agent or a Secured Party is
an additional insured thereunder or a loss payee thereof) or any indemnity,
warranty or guaranty payable by reason of loss or damage to or otherwise with
respect to any of the foregoing Borrower Collateral.
SECTION 9.2 DELIVERY OF COLLATERAL. All documents in the
Receivables File shall be delivered to and held by or on behalf of the
Custodian pursuant to the Custodial Agreement, and shall be in suitable
form for transfer by delivery.
SECTION 9.3 BORROWER REMAINS LIABLE. Notwithstanding anything in
this Agreement, (a) except to the extent of the Servicer's duties
hereunder, the Borrower shall remain liable under the Transferred
Receivables, Borrower Assigned Agreements and other agreements (including
each Interest Rate Hedge) included in the Borrower Collateral to perform
all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (b) the exercise by the Agent, a
Secured Party or the Collateral Agent of any of its rights under this
Agreement, the Custodial Agreement or the Collateral Agent Agreement
shall not release the Borrower, AFL or the Servicer from any of their
respective duties or obligations under the Transferred Receivables,
Borrower Assigned Agreements or other agreements included in the Borrower
Collateral, (c) the Agent, the Secured Parties, the Collateral Agent and
the Custodian shall not have any obligation or liability under the
Transferred Receivables, Borrower Assigned Agreements or other agreements
included in the Borrower Collateral by reason of this Agreement, the
Custodial Agreement or the Collateral Agent Agreement, and (d) neither
the Agent, the Collateral Agent, the Custodian nor any of the Secured
Parties shall be obligated to perform any of the obligations or duties of
the Borrower, AFL or the Servicer under the Transferred Receivables,
Borrower Assigned Agreements or other agreements included in the Borrower
Collateral or to take any action to collect or enforce any claim for
payment assigned under this Agreement.
SECTION 9.4 COVENANTS OF THE BORROWER AND SERVICER REGARDING THE
COLLATERAL.
(a) OFFICES AND RECORDS. The Borrower shall keep its chief
place of business and
chief executive offices and the office where it keeps its records at the
location specified in SECTION 10.9 or, upon 60 days prior written notice
to the Collateral Agent and the Agent, at such other location in a
jurisdiction where all action required by SECTION 9.4(e) shall have been
taken with respect to the Borrower Collateral. The Borrower and the
Servicer shall, for not less than three years or for such longer period
as may be required by law, from the date on which any Transferred
Receivable arose, maintain the records with respect to each Transferred
Receivable, including records of all payments received, credits granted
and merchandise returned. The Borrower and the Servicer will permit
representatives of the Agent, the Backup Servicer, the Collateral Agent
and the Custodian at any time and from time to time during normal
business hours, and at such times outside of normal business hours as the
Agent, the Backup Servicer, the Collateral Agent and the Custodian shall
reasonably request, (i) to inspect and make copies of and abstracts from
such records, and (ii) to visit the properties of the Borrower or the
Servicer utilized in connection with the collection, processing or
servicing of the Transferred Receivables for the purpose of examining
such records, and to discuss matters relating to the Receivables or the
Borrower's or Servicer's performance under this Agreement with any
officer or employee of the Borrower or Servicer having knowledge of such
matters. In connection therewith, the Agent, the Backup Servicer, the
Collateral Agent or the Custodian may institute procedures to permit it
to confirm the Obligor balances in respect of any Transferred
Receivables. Each of the Borrower and the Servicer agrees to render to
the Agent, the Backup Servicer, the Collateral Agent and the Custodian
such clerical and other assistance as may be reasonably requested with
regard to the foregoing. Without duplication of any obligations of the
Servicer set forth in clause (b) below, if a Facility Termination Event
shall have occurred and be continuing, promptly upon request therefor,
the Borrower or the Servicer shall deliver to the Collateral Agent and
the Agent records reflecting activity through the close of business on
the immediately preceding Business Day.
(b) MAINTAIN RECORDS OF TRANSFERRED RECEIVABLES. The Servicer
shall, at its own cost and expense, maintain satisfactory and complete
records of the Collateral, including a record of all payments received
and all credits granted with respect to the Collateral and all other
dealings with the Collateral. Each of the Borrower and the Servicer will
▇▇▇▇ conspicuously with a legend, in form and substance satisfactory to
the Agent, its records, computer tapes, computer disks and credit files
pertaining to the Collateral, and its storage facilities where it
maintains information pertaining to the Collateral, to evidence this
Agreement and the assignment and security interest granted by this
ARTICLE IX. Upon the occurrence and during the continuation of a
Facility Termination Event, the Borrower and Servicer shall (i) deliver
and turn over to the Backup Servicer or to its representatives, or at the
option of the Backup Servicer, shall provide the Backup Servicer or its
representatives with access to, after the occurrence of a Facility
Termination Event, at any time, and during all other times, during
ordinary business hours, on demand of the Backup Servicer, all of the
Borrower's and Servicer's facilities, personnel, books and records
pertaining to the Collateral, including all records, and (ii) allow the
Backup Servicer to occupy the premises of the Borrower and the Servicer
where such books and records are maintained, and utilize such premises,
the equipment thereon and any personnel of the Borrower or the Servicer
that the Backup Servicer may wish to employ to administer, service and
collect the Transferred Receivables. The Backup Servicer will reimburse
the Servicer for the cost of the use of the
portion of such premises, equipment and personnel used by the Backup
Servicer in accordance with the Facilities Management Agreement, dated as
of March 9, 1998 by and between Norwest and AFL.
(c) PERFORMANCE OF BORROWER ASSIGNED AGREEMENTS. The Borrower
shall (i) perform and observe all the terms and provisions of the
Borrower Assigned Agreements and the Interest Rate ▇▇▇▇▇▇ to be performed
or observed by it, maintain the Borrower Assigned Agreements and the
Interest Rate ▇▇▇▇▇▇ in full force and effect, enforce the Borrower
Assigned Agreements and the Interest Rate ▇▇▇▇▇▇ in accordance with their
terms and take all such action to such end as may be from time to time
requested by the Agent, and (ii) upon request of the Agent, make to any
other party to the Borrower Assigned Agreements and the Interest Rate
▇▇▇▇▇▇ such demands and requests for information and reports or for
action as the Borrower is entitled to make under the Borrower Assigned
Agreements and the Interest Rate ▇▇▇▇▇▇.
(d) NOTICE OF ADVERSE CLAIM. Each of the Borrower and the
Servicer shall advise the Agent and the Collateral Agent promptly, in
reasonable detail, (i) of any Adverse Claim known to it made or asserted
against any of the Borrower Collateral, and (ii) of the occurrence of any
event which would have a material adverse effect on the aggregate value
of the Borrower Collateral or on the assignments and security interests
granted by the Borrower in this Agreement.
(e) FURTHER ASSURANCES; FINANCING STATEMENTS.
(i) Each of the Borrower and the Servicer severally
agrees that at any time and from time to time, at its expense, it shall promptly
execute and deliver all further instruments and documents, and take all
reasonable further action, that may be necessary or desirable or that the Agent
or the Collateral Agent may reasonably request to perfect and protect the
assignments and security interests granted or purported to be granted by this
ARTICLE IX or to enable the Agent or the Collateral Agent to exercise and
enforce its rights and remedies under this Agreement and the Collateral Agent
Agreement with respect to any Borrower Collateral. Without limiting the
generality of the foregoing, the Borrower shall execute and file such financing
or continuation statements, or amendments thereto, and such other instruments or
notices as may be necessary or desirable or that the Agent or the Collateral
Agent may reasonably request to protect and preserve the assignments and
security interests granted by this Agreement and the Collateral Agent Agreement.
(ii) The Borrower, the Agent and each Secured Party
hereby severally authorize the Collateral Agent to execute and file one or more
financing or continuation statements, and amendments thereto, relating to all or
any part of the Borrower Collateral without the signature of the Borrower, the
Agent or the Secured Parties where permitted by law. A carbon, photographic or
other reproduction of this Agreement or any financing statement covering the
Borrower Collateral or any part thereof shall be sufficient as a financing
statement where permitted by law. The Collateral Agent will promptly send to
the Borrower and the Agent any financing or continuation
statements thereto which it files without the signature of the Borrower and will
promptly send to the Agent and the Borrower any financing or continuation
statements thereto which it files without the signature of the Agent except, in
the case of filings of copies of this Agreement as financing statements, the
Collateral Agent will promptly send the Borrower and the Agent, as the case may
be, the filing or recordation information with respect thereto.
(iii) Each of the Borrower and the Servicer shall furnish
to the Collateral Agent and the Agent from time to time such statements and
schedules further identifying and describing the Borrower Collateral and such
other reports in connection with the Borrower Collateral as the Collateral Agent
or the Agent may reasonably request, all in reasonable detail.
SECTION 9.5 RELEASE OF BORROWER COLLATERAL.
(a) GENERALLY. For purposes of selling and transferring
Receivables to third parties in connection with any Take-Out
Securitization, to the extent that (immediately after giving effect to
any requested release) there exists no Borrowing Base Deficiency and,
unless all Advances, Yield thereon and other amounts due hereunder have
been paid in full, there is no Facility Termination Event or Unmatured
Facility Termination Event, or, in connection with the purchase by the
Servicer of a Receivable pursuant to SECTION 8.4 or 8.7 or by AFL under
the Purchase Agreement, the Borrower may obtain releases of the
Collateral Agent's (for the benefit of the Secured Parties) security
interest in all or any part of the Borrower Collateral and from time to
time. Each request (a "TRANSFER REQUEST") for a partial release of
Collateral, except in connection with the repurchase by the Servicer of a
Receivable pursuant to SECTION 8.4 or 8.7 or by AFL under the Purchase
Agreement, shall be addressed to the Agent (with a copy thereof sent by
the Borrower or the Servicer to the Collateral Agent), demonstrating
compliance with the immediately preceding sentence and acknowledging that
the receipt of proceeds from such sale or transfer shall be deposited
into the Collection Account.
(b) TRANSFERS. With respect to each Transfer Request that is
received by the Agent by 12:00 noon, New York time, on a Business Day,
the Agent shall use due diligence and reasonable efforts to review such
Transfer Requests and instruct the Custodian (if AFL is not the
Custodian) to prepare the files, identified in each Transfer Request, for
shipment by 12:00 noon, New York time on the second succeeding Business
Day.
(c) CONTINUATION OF LIEN. Unless released in writing by the
Collateral Agent, as herein provided, the security interest in favor of
the Collateral Agent, for the benefit of the Secured Parties, in all
Borrower Collateral shall continue in effect until such time as the
Collateral Agent shall have received payment in full of the proceeds from
the sale or transfer of such Borrower Collateral to third parties in
accordance with this SECTION 9.5.
(d) APPLICATION OF PROCEEDS; NO DUTY. Neither of the Agent,
nor the Collateral Agent, nor any Secured Party shall be under any duty
at any time to credit Borrower for any amount due from any third party in
respect of any purchase of any Borrower Collateral contemplated above,
until the Collateral Agent has actually received such amount in
immediately available funds for deposit to the Collection Account.
Neither the Collateral Agent nor any Secured Party nor the Agent shall be
under any duty at any time to collect any
amounts or otherwise enforce any obligations due from any third party in
respect of any such purchase of Receivables covered by the release of
such portion of Borrower Collateral or in respect of a securitization
thereof with a third party.
(e) REPRESENTATION IN CONNECTION WITH RELEASES, SALES AND
TRANSFERS. The Borrower represents and warrants that each request for
any release or transfer in connection with other securitizations pursuant
to SECTION 9.5(a) shall automatically constitute a representation and
warranty to the Secured Parties, the Agent and the Collateral Agent to
the effect that immediately before and after giving effect to such
release or Transfer Request, there is no Facility Termination Event, or
Unmatured Facility Termination Event (including, without limitation a
Borrowing Base Deficiency).
(f) RELEASE OF SECURITY INTEREST. Upon receipt of a Transfer
Request or, in connection with the purchase by the Servicer of a
Receivable pursuant to SECTION 8.4 OR 8.7 or by AFL under the Purchase
Agreement, upon the Servicer's written request, and, in each case upon
receipt in the Collection Account of proceeds from the sale or transfer,
the Collateral Agent shall promptly release, at the Borrower's expense,
such part of Borrower Collateral covered in connection with the Transfer
Request or such Servicer's request and shall deliver, at the Borrower's
expense, the documents and certificates on the released portion of
Borrower Collateral to the trustee or such similar entity in connection
with any Take-Out Securitization or, in connection with the purchase by
the Servicer of a Receivable pursuant to SECTION 8.4 OR 8.7 or by AFL
under the Purchase Agreement, the Servicer; PROVIDED that the trustee or
such similar entity in connection with any Take-Out Securitization or the
Servicer, as the case may be, acknowledges and agrees (i) that all
proceeds thereof that it receives are held in trust for the Secured
Parties and (ii) at such time that the Agent shall instruct such trustee
to transfer such proceeds, the trustee shall transfer such funds pursuant
to such instructions.
ARTICLE X
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
In order to induce the other parties hereto to enter into this
Agreement and, in the case of the Lenders, to make Advances hereunder,
the Borrower hereby represents and warrants to the Agent and the
Investors as to itself, as of the Closing Date and as of each Advance
Date, as follows:
SECTION 10.1 ORGANIZATION AND GOOD STANDING. The Borrower has
been duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is currently conducted.
The Borrower had at all relevant times and now has, power, authority and
legal right to acquire and own the Transferred Receivables and the Other
Conveyed Property, and to grant to the Collateral Agent a security
interest in the Transferred Receivables, the Other Conveyed Property and
the other Borrower Collateral and to enter into and perform its
obligations under this Agreement.
SECTION 10.2 DUE QUALIFICATION. The Borrower is duly qualified
to do business as a foreign entity in good standing, and has obtained all
necessary licenses and approvals, in all jurisdictions in which the
ownership or lease of its property or the conduct of its business
requires such qualification.
SECTION 10.3 POWER AND AUTHORITY. The Borrower has the power and
authority to execute and deliver this Agreement and the other Transaction
Documents to which it is a party and to carry out its terms and their
terms, respectively; the Borrower has full power and authority to grant
to the Collateral Agent, for the benefit of the Secured Parties, a
perfected first priority security interest in the Transferred Receivables
and the other Borrower Collateral and has duly authorized such grant by
all necessary corporate action; and the execution, delivery and
performance of this Agreement and the other Transaction Documents to
which it is a party have been duly authorized by the Borrower by all
necessary corporate action.
SECTION 10.4 SECURITY INTEREST; BINDING OBLIGATIONS. This
Agreement and the Transaction Documents to which it is a party have been
duly executed and delivered and shall create a valid first priority
security interest (except, as to priority, for any tax liens or mechanics
liens that may arise after the Closing Date) in the Borrower Collateral
in favor of the Collateral Agent, on behalf of the Secured Parties,
enforceable against the Borrower and creditors of and purchasers from the
Borrower; and this Agreement and the other Transaction Documents to which
it is a party constitute legal, valid and binding obligations of the
Borrower enforceable in accordance with their respective terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization
or other similar laws affecting the enforcement of creditors' rights
generally and by equitable limitations on the availability of specific
remedies, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
SECTION 10.5 NO VIOLATION. The consummation of the transactions
contemplated by this Agreement and the other Transaction Documents to
which it is a party, and the fulfillment of the terms of this Agreement
and the other Transaction Documents to which it is a party, shall not
conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time) a default
under, the certificate of incorporation or bylaws of the Borrower, or any
indenture, agreement, mortgage, deed of trust or other instrument to
which the Borrower is a party or by which it is bound or any of its
properties are subject, or result in the creation or imposition of any
Lien upon any of its properties pursuant to the terms of any such
indenture, agreement, mortgage, deed of trust or other instrument, other
than this Agreement, or violate any law, order, rule or regulation
applicable to the Borrower of any Official Body having jurisdiction over
the Borrower or any of its properties, or in any way adversely affect the
Borrower's ability to perform its obligations under this Agreement or the
other Transaction Documents to which it is a party.
SECTION 10.6 NO PROCEEDINGS. There are no proceedings or
investigations pending or, to the Borrower's knowledge, threatened
against the Borrower, before any court or other Official Body having
jurisdiction over the Borrower or its properties (A) asserting the
invalidity of this Agreement or any of the other Transaction Documents,
(B) seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or any of the other Transaction Documents,
(C) seeking any determination or ruling that might materially and
adversely affect the performance by the Borrower of its obligations
under, or the validity or enforceability of, this Agreement or any of the
other Transaction Documents, (D) involving the Borrower or (E) that could
have a material adverse effect on the Transferred Receivables.
SECTION 10.7 NO CONSENTS. The Borrower is not required to obtain
the consent of any other Person or any consent, license, approval or
authorization of, or registration or declaration with, any Official Body
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement or the other Transaction Documents to
which it is a party.
SECTION 10.8 USE OF PROCEEDS. No proceeds of any Advance will be
used by the Borrower to acquire any security in any transaction which is
subject to Section 13 or 14 of the Securities Exchange Act of 1934, as
amended.
SECTION 10.9 CHIEF EXECUTIVE OFFICE. The chief executive office
of the Borrower is located at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
SECTION 10.10 SOLVENCY. The Borrower is solvent and will not
become insolvent after giving effect to the transactions contemplated by
this Agreement and the Transaction Documents. The Borrower has no
Indebtedness to any Person other than pursuant to this Agreement and the
other Transaction Documents. The Borrower, after giving effect to the
transactions contemplated by this Agreement and the other Transaction
Documents, will have an adequate amount of capital to conduct its
business in the foreseeable future.
SECTION 10.11 TAX TREATMENT. For federal income tax purposes,
each Transferred Receivable and the related Other Conveyed Property will
be treated as owned by AFL and its consolidated subsidiaries, including
the Borrower. For accounting purposes, the Borrower will treat the
purchase or absolute assignment of each Transferred Receivable and Other
Conveyed Property pursuant to the Purchase Agreement as a purchase or
absolute assignment of AFL's full right, title and ownership interest in
such Transferred Receivable and Other Conveyed Property (and those
Transferred Receivables and Other Conveyed Property contributed to the
Borrower by AFL pursuant to the Purchase Agreement shall be accounted for
as an increase in the stated capital of the Borrower) and the Borrower
has not in any other manner accounted for or treated the transfer to it
of Transferred Receivables and Other Conveyed Property.
SECTION 10.12 COMPLIANCE WITH LAWS. The Borrower has complied
and will comply in all material respects with all applicable laws, rules,
regulations, judgments, agreements, decrees and orders with respect to
its business and properties and all Borrower Collateral.
SECTION 10.13 TAXES. The Borrower has filed on a timely basis
all tax returns
(including, without limitation, foreign, federal, state, local and
otherwise) required to be filed, is not liable for taxes payable by any
other Person and has paid or made adequate provisions for the payment of
all taxes, assessments and other governmental charges due from the
Borrower. No tax lien or similar adverse claim has been filed, and no
claim is being asserted, with respect to any such tax, assessment or
other governmental charge. Any taxes, fees and other governmental
charges payable by the Borrower in connection with the execution and
delivery of this Agreement and the other Transaction Documents and the
transactions contemplated hereby or thereby including the transfer of
each Transferred Receivable and Other Conveyed Property to the Borrower
have been paid or shall have been paid if and when due at or prior to the
Closing Date and the relevant Purchase Date, as the case may be.
SECTION 10.14 CERTIFICATES. Each Servicer's Certificate and
Borrowing Base Confirmation is accurate in all material respects as of
the date thereof.
SECTION 10.15 NO LIENS, ETC. The Borrower Collateral and each
part thereof is owned by the Borrower free and clear of any Adverse Claim
or restrictions on transferability and the Borrower has the full right,
corporate power and lawful authority to assign, transfer and pledge the
same and interests therein, and upon the making of each Advance, the
Collateral Agent, for the benefit of the Secured Parties, will have
acquired a perfected, first priority and valid security interest (except,
as to priority, for any tax lien or mechanics liens that may arise after
the Closing Date) in such Borrower Collateral, free and clear of any
Adverse Claim or restrictions on transferability. No effective financing
statement or other instrument similar in effect covering all or any part
of the Borrower Collateral is on file in any recording office, except
such as may have been filed in favor of the Collateral Agent as "Secured
Party" pursuant to ARTICLE IX of this Agreement or, with respect to the
Transferred Receivables, in favor of the Borrower pursuant to the
Purchase Agreement.
SECTION 10.16 PURCHASE AND SALE. Each Transferred Receivable and
Other Conveyed Property was purchased by, or contributed to, the Borrower
on the relevant Purchase Date pursuant to the Purchase Agreement.
SECTION 10.17 INVESTMENT COMPANY ACT OF 1940. Each purchase of
Transferred Receivables and Other Conveyed Property under the Purchase
Agreement will constitute a purchase or other acquisition of notes,
drafts, acceptances, open accounts receivable or other obligations
representing part or all of the sales price of merchandise, insurance or
services within the meaning of Section 3(c)(5) of the Investment Company
Act of 1940, as amended.
SECTION 10.18 INFORMATION TRUE AND CORRECT. All information
heretofore or hereafter furnished by or on behalf of the Borrower to any
Lender, the Agent or the Collateral Agent in connection with this
Agreement or any transaction contemplated hereby is and will be true and
complete in all material respects and does not and will not omit to state
a material fact necessary to make the statements contained therein not
misleading.
SECTION 10.19 ERISA COMPLIANCE. The Borrower is in compliance
with ERISA and has not incurred and does not expect to incur any
liabilities (except for premium payments arising in the ordinary course
of business) to the Pension Benefit Guaranty
Corporation (or any successor thereto) under ERISA.
SECTION 10.20 FINANCIAL OR OTHER CONDITION. There has been no
material adverse change in the condition (financial or otherwise),
business, operations, results of operations, or properties of the
Borrower.
SECTION 10.21 INVESTMENT COMPANY STATUS. The Borrower is not an
"investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended.
SECTION 10.22 NO TRADE NAMES. The Borrower has no trade names,
fictitious names, assumed names or "doing business as" names.
SECTION 10.23 SEPARATE CORPORATE EXISTENCE. The Borrower is
operated as an entity with assets and liabilities distinct from those of
AFL and any other Affiliates of the Borrower, and the Borrower hereby
acknowledges that the Agent and each of the Lenders are entering into the
transactions contemplated by this Agreement in reliance upon the
Borrower's identity as a separate legal entity from AFL and each such
Affiliate. Since its incorporation, the Borrower has been (and will be)
operated in such a manner as to comply with the covenants set forth in
SECTION 11.5.
There is not now, nor will there be at any time in the
future, any agreement or understanding between AFL and the Borrower
(other than as expressly set forth herein) providing for the allocation
or sharing of obligations to make payments or otherwise in respect of any
taxes, fees, assessments or other governmental charges.
SECTION 10.24 INVESTMENTS. The Borrower does not own or hold,
directly or indirectly, any capital stock or equity security of, or any
equity interest in, any Person.
SECTION 10.25 REPRESENTATION AND WARRANTIES TRUE AND CORRECT.
Each of the representations and warranties of the Borrower contained in
this Agreement and the other Transaction Documents is true and correct in
all material respects and the Borrower hereby makes each such
representation and warranty to, and for the benefit of, the Investors,
the Agent and the Collateral Agent as if the same were set forth in full
herein.
SECTION 10.26 TRANSACTION DOCUMENTS. The Purchase Agreement is
the only agreement pursuant to which the Borrower purchases and receives
contributions of Receivables, and the Transaction Documents delivered to
the Agent represent all material agreements between AFL, on the one hand,
and the Borrower, on the other. The Borrower has furnished to the Agent
true, correct and complete copies of each Transaction Document to which
the Borrower is a party, each of which is in full force and effect.
Neither the Borrower nor any Affiliate party thereto is in default of any
of its obligations thereunder in any material respect. Upon the purchase
and/or contribution of each Receivable pursuant to the Purchase
Agreement, the Borrower shall be the lawful owner of, and have good title
to, such Receivable and all assets relating thereto, free and clear of
any Liens. All such assets are transferred to the Borrower without
recourse to AFL except as described in the Purchase
Agreement. The purchases of such assets by the Borrower constitute valid
and true sales for consideration (and not merely a pledge of such assets
for security purposes) and the contributions of such assets received by
the Borrower constitute valid and true transfers for consideration, each
enforceable against creditors of AFL, and no such assets shall constitute
property of AFL.
SECTION 10.27 OWNERSHIP OF THE BORROWER. One hundred percent
(100%) of the outstanding capital stock of the Borrower is directly owned
(both beneficially and of record) by AFL free and clear of any Liens.
Such stock is validly issued, fully paid and nonassessable and there are
no options, warrants or other rights to acquire capital stock from the
Borrower.
SECTION 10.28 ELIGIBLE RECEIVABLES. All Receivables included in
the Borrowing Base as of the most recently delivered Servicer's
Certificate or Borrowing Base Confirmation are Eligible Receivables.
ARTICLE XI
COVENANTS OF THE BORROWER
From the date hereof until the first day, following the Commitment
Termination Date, on which all Obligations shall have been finally and
fully paid and performed, the Borrower hereby covenants and agrees with
the Investors and the Agent as follows:
SECTION 11.1 PROTECTION OF SECURITY INTEREST OF THE SECURED
PARTIES.
(a) At or prior to the Closing Date, the Borrower shall have
filed or caused to be filed UCC-1 financing statements, executed by the
Borrower as debtor, naming the Collateral Agent (for the benefit of the
Secured Parties) as secured party and describing the Collateral, with the
office of the Secretary of State of the State of Minnesota and in such
other locations as may be necessary to perfect the security interests
intended to be granted hereby or as the Agent shall have required. From
time to time thereafter, the Borrower shall execute and file such
financing statements and cause to be executed and filed such continuation
statements, all in such manner and in such places as may be required by
law fully to preserve, maintain and protect the interest of the
Collateral Agent and the Secured Parties under this Agreement in the
Borrower Collateral and in the proceeds thereof. The Borrower shall
deliver (or cause to be delivered) to the Agent file-stamped copies of,
or filing receipts for, any document filed as provided above, as soon as
available following such filing. In the event that the Borrower fails to
perform its obligations under this subsection, the Agent or the
Collateral Agent at the direction of the Agent, may do so, in each case
at the expense of the Borrower.
(b) The Borrower shall not change its name, identity, or
corporate structure in any manner that would, could or might make any
financing statement or continuation statement filed by the Borrower (or
by the Agent or the Collateral Agent on behalf of the Borrower) in
accordance with paragraph (a) above seriously misleading within the
meaning of Section 9-402(7) of the UCC, unless the Borrower shall have
given the Agent at least 60 days prior written notice
thereof, and shall promptly file appropriate amendments to all previously
filed financing statements and continuation statements.
(c) The Borrower shall give the Agent at least 60 days prior
written notice of any relocation of its principal executive office if, as
a result of such relocation, the applicable provisions of the UCC would
require the filing of any amendment of any previously filed financing or
continuation statement or of any new financing statement. The Borrower
shall at all times maintain its principal executive office within the
United States of America.
(d) The Borrower shall maintain its computer systems, if any,
so that, from and after the time of the first Advance under this
Agreement, the Borrower's master computer records (including archives)
that shall refer to the Collateral indicate clearly that such Collateral
is subject to first priority security interest in favor of the Collateral
Agent, for the benefit of the Secured Parties. Indication of the
Collateral Agent's (for the benefit of the Secured Parties) security
interest shall be deleted from or modified on the Borrower's computer
systems when, and only when, the Collateral in question shall have been
paid in full.
(e) If at any time the Borrower shall propose to sell, grant a
security interest in, or otherwise transfer any interest in motor vehicle
receivables to any prospective purchaser, lender or other transferee, the
Borrower shall give to such prospective purchaser, lender, or other
transferee computer tapes, records, or print-outs (including any restored
from archives) that, if they shall refer in any manner whatsoever to any
Collateral shall indicate clearly that such Collateral is subject to a
first priority security interest in favor of the Collateral Agent, for
the benefit of the Secured Parties.
SECTION 11.2 REPORTING REQUIREMENTS. The Borrower shall furnish,
or cause to be furnished, to the Agent and the Collateral Agent:
(a) as soon as available and in any event within 90 days (or next
succeeding Business Day if the last day of such period is not a Business Day)
after the end of each fiscal year, a copy of the audited consolidated financial
statements for such year for AFL and its consolidated Subsidiaries, certified,
without qualification by Independent Accountants acceptable to the Agent and
each other report or statement sent to shareholders or publicly filed by AFL or
the Borrower;
(b) as soon as available and in any event within 45 days (or next
succeeding Business Day if the last day of such period is not a Business Day)
after the end of each of the first three quarters of each fiscal year of AFL, a
consolidated balance sheet of AFL and its consolidated Subsidiaries as of the
end of such quarter and including the prior comparable period, and consolidated
statements of income and retained earnings, of AFL and its consolidated
Subsidiaries for such quarter and for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter, certified by the
chief financial officer or chief accounting officer of AFL identifying such
documents as being the documents described in this paragraph (c) and stating
that the information set forth therein fairly presents the financial condition
of AFL and its consolidated Subsidiaries as of and for the periods then ended,
subject to year-end adjustments consisting only of normal, recurring accruals
and confirming that AFL is
in compliance with all financial covenants in this Agreement;
(c) as soon as possible and in any event within five days after the
occurrence of a Facility Termination Event or an Unmatured Facility Termination
Event, the statement of the chief executive officer of the Borrower setting
forth complete details of such Facility Termination Event or Unmatured Facility
Termination Event and the action which the Borrower has taken, is taking and
proposes to take with respect thereto; and
(d) promptly, from time to time, such other information, documents,
records or reports respecting the Transferred Receivables, the Other Conveyed
Property or the Financed Vehicles related thereto, the other Borrower Collateral
or the condition or operations, financial or otherwise, of the Borrower, or AFL
or any of its Subsidiaries, as the Agent may, from time to time, reasonably
request.
SECTION 11.3 PRESERVATION OF EXISTENCE. The Borrower shall
observe all procedures required by its organizational documents and
by-laws and preserve and maintain its existence, rights, franchises and
privileges in the jurisdiction of its incorporation, and qualify and
remain qualified in good standing in each jurisdiction where the failure
to preserve and maintain such existence, rights, franchises, privileges
and qualifications would materially adversely affect (1) the interests
hereunder of the Agent or any Affected Person, (2) the collectibility of
any Receivable or (3) its ability to perform its obligations hereunder or
under any of the other Transaction Documents.
SECTION 11.4 KEEPING OF RECORDS AND BOOKS OF ACCOUNT. The
Borrower shall maintain and implement (or cause the Servicer to maintain
and implement) administrative and operating procedures (including,
without limitation, an ability to recreate records evidencing the
Receivables in the event of the destruction of the originals thereof) and
keep and maintain, all documents, books, records and other information
reasonably necessary or advisable for the collection of all Transferred
Receivables (including, without limitation, records adequate to permit
the daily identification of all collections of and adjustments to each
Transferred Receivable).
SECTION 11.5 SEPARATE CORPORATE EXISTENCE. The Borrower shall
take all reasonable steps (including, without limitation, all steps that
the Agent may from time to time reasonably request) to maintain the
Borrower's identity as a separate legal entity from AFL or any of its
Affiliates and to make it manifest to third parties that the Borrower is
an entity with assets and liabilities distinct from those of AFL and each
other Affiliate thereof. Without limiting the generality of the
foregoing, the Borrower shall:
(a) conduct business correspondence in its own name, hold regular
meetings of, or obtain regular written consents from, its Board of Directors and
maintain appropriate books and records;
(b) except as set forth in its certificate of incorporation, not
permit any limitation on the authority of its own directors and officers to
conduct its business and affairs in accordance with their independent business
judgment, and shall not authorize or suffer any Person other than its own
directors and officers to act on its behalf with respect to matters (other than
matters
customarily delegated to others under powers of attorney) for which a
corporation's own directors and officers would customarily be responsible;
(c) subject to the terms of the Custodial Agreement, maintain or
cause to be maintained by an agent of the Borrower under the Borrower's
control physical possession of all its books and records;
(d) maintain capitalization adequate for the conduct of its business;
(e) account for and manage its liabilities separately from those of
any other Person, including, without limitation, payment of all payroll and
other administrative expenses and taxes from its own assets;
(f) maintain its assets separately from those of any other Person;
(g) maintain offices through which its business is conducted separate
from those of AFL and any Affiliates of AFL (PROVIDED that, to the extent
that AFL and any of its Affiliates have offices in the same location, there
shall be a fair and appropriate allocation of overhead costs and expenses
among them, and each such entity shall bear its fair share of such expenses);
(h) not commingle its funds with those of AFL or any Affiliate of AFL
or any Affiliates of the Borrower except to the extent contemplated herein,
or use its funds for other than the Borrower's uses; and
(i) ensure that any financial reports required of the Borrower shall
comply with GAAP and shall be issued separately from, but may be consolidated
with, any reports prepared by any of its Affiliates.
SECTION 11.6 INTEREST RATE ▇▇▇▇▇▇. The Borrower shall maintain,
at all times on and after the date of the initial Advance hereunder,
Interest Rate ▇▇▇▇▇▇ (a) between the Borrower and (i) CSFB or any of its
Affiliates or (ii) any other bank or other financial institution whose
long-term rating is at least AA- from S&P and Aa3 from ▇▇▇▇▇'▇ and whose
short-term unsecured debt obligation rating is at least A-1/P-1 by S&P
and ▇▇▇▇▇'▇, respectively, and is reasonably acceptable to the Agent,
(b) with a notional principal amount not less than the outstanding
principal amount of the Advances and with a final maturity date no
earlier than the date of the last required Scheduled Payment of any
Receivable in the Total Receivables Pool, (c) which have a strike price
no greater than the Maximum Interest Rate Cap Strike Price and (d) which
are otherwise in form and substance reasonably acceptable to the Agent.
SECTION 11.7 TANGIBLE NET WORTH. The Borrower shall maintain at
all times a positive Tangible Net Worth.
SECTION 11.8 TAKE-OUT SECURITIZATION. The Borrower shall effect
or cause an Affiliate to effect a Take-Out Securitization no more than
six months after the Closing Date and thereafter no more than four months
after the immediately preceding Take-Out
Securitization.
SECTION 11.9 SALES, LIENS, ETC., AGAINST RECEIVABLES AND RELATED
ASSETS. The Borrower shall not, except as otherwise provided herein,
sell, assign (by operation of law or otherwise) or otherwise dispose of,
or create or suffer to exist, any Lien upon or with respect to, any
Transferred Receivable or any other Borrower Collateral.
SECTION 11.10 STOCK, MERGER, CONSOLIDATION, ETC. The Borrower
shall not
(a) Merge or consolidate with or into, or sell, convey,
transfer, exchange, lease or otherwise dispose of (whether in one
transaction or in a series of transactions) all or substantially all of
its assets (whether now owned or hereafter acquired) to, acquire all or
substantially all of the assets of, any Person or division of any Person;
or, except as expressly permitted under the terms of this Agreement and
its certificate of incorporation, sell, convey, transfer, exchange, lease
or otherwise dispose of any of its assets; or
(b) Issue or allow the issuance of any shares of its capital
stock or rights, warrants or options in respect of its capital stock,
other than the shares of common stock which are and shall at all times
during the term of this Agreement be legally and beneficially owned by
AFL, free and clear of all Liens.
SECTION 11.11 CHANGE IN CORPORATE NAME. The Borrower shall not
make any change to its corporate name or use any trade names, fictitious
names, assumed names or "doing business as" names.
SECTION 11.12 INDEBTEDNESS. The Borrower shall not incur,
create, assume, suffer to exist or otherwise become liable with respect
to any Indebtedness other than (i) hereunder and under the Purchase
Agreement and (ii) other Indebtedness for operational expenses of the
Borrower in an amount not to exceed $50,000 at any one time outstanding.
SECTION 11.13 GUARANTEES. The Borrower shall not guarantee,
endorse or otherwise be or become contingently liable (including by
agreement to maintain balance sheet tests) in connection with the
obligations of any other Person, except endorsements of negotiable
instruments for collection in the ordinary course of business and
reimbursement or indemnification obligations in favor of the Agent or any
Affected Person as provided for under this Agreement.
SECTION 11.14 LIMITATION ON TRANSACTIONS WITH AFFILIATES. The
Borrower shall not enter into, or be a party to any transaction with any
Affiliate of the Borrower, except for (a) the transactions contemplated
by the Transaction Documents and (b) to the extent not otherwise
prohibited under this Agreement, other transactions in the nature of
employment contracts and directors' fees, upon fair and reasonable terms
materially no less favorable to the Borrower than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate.
SECTION 11.15 DOCUMENTS. The Borrower shall not cancel or
terminate any of the
Transaction Documents to which it is party (in any capacity), or consent
to or accept any cancellation or termination of any of such agreements,
or amend or otherwise modify any term or condition of any of the
Transaction Documents to which it is party (in any capacity) or give any
consent, waiver or approval under any such agreement, or waive any
default under or breach of any of the Transaction Documents to which it
is party (in any capacity) or take any other action under any such
agreement not required by the terms thereof, unless (in each case) the
Agent shall have consented thereto; PROVIDED that the consent of the
Agent shall not be required to add additional parties to the Lock-Box
Agreement in accordance with paragraph 2 thereof.
SECTION 11.16 CHARTER AND BY-LAWS. The Borrower shall not amend,
modify or otherwise change any of the terms or provisions in its
certificate of incorporation, its by-laws, any document setting forth the
designation, amount, relative rights, limitations and preferences of any
class or series of its capital stock, and in each case, any equivalent
documents, as in effect on the date hereof, without the prior written
consent of the Agent.
SECTION 11.17 ACCOUNTING TREATMENT. The Borrower shall not
prepare any financial statements or other statements (including any tax
filings which are not consolidated with those of AFL) which shall account
for the transactions contemplated by the Purchase Agreement in any manner
other than as the sale of, or a capital contribution of, the Transferred
Receivables and the related assets by AFL to the Borrower.
SECTION 11.18 LIMITATION ON INVESTMENTS. The Borrower shall not
form, or cause to be formed, any Subsidiaries; or make or suffer to exist
any loans or advances to, or extend any credit to, or make any
investments (by way of transfer of property, contributions to capital,
purchase of stock or securities or evidences of indebtedness, acquisition
of the business or assets, or otherwise) in, any Affiliate or any other
Person except as otherwise permitted herein and pursuant to the Purchase
Agreement.
SECTION 11.19 DIVIDENDS. The Borrower shall not declare or make
(a) payment of any dividend or other distribution on or in respect of any
shares of its capital stock, or (b) any payment on account of the
purchase, redemption, retirement or acquisition of 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 Facility Termination Event or Unmatured Facility Termination
Event shall occur or be continuing and no amount payable by the Borrower
under any Transaction Document is then due and owing but unpaid.
SECTION 11.20 OTHER LIENS OR INTERESTS. Except for the security
interest granted hereunder, the Borrower will not sell, pledge, assign or
transfer to any other Person, or grant, create, incur, assume or suffer
to exist any Lien on the Borrower Collateral or any interest therein, and
the Borrower shall defend the right, title, and interest of the
Collateral Agent (for the benefit of the Secured Parties), in and to the
Borrower Collateral against all claims of third parties claiming through
or under the Borrower.
ARTICLE XII
THE SERVICER
SECTION 12.1 LIABILITY OF SERVICER; INDEMNITIES.
(a) The Servicer shall be liable hereunder only to the extent
of the obligations in this Agreement and the other Transaction Documents
specifically undertaken by the Servicer and the representations made by
the Servicer.
(b) The Servicer shall defend, indemnify and hold harmless each
Indemnified Party from and against any and all costs, expenses, losses,
damages, claims, liabilities, penalties, fines, forfeitures and
judgments, including reasonable fees and expenses of counsel and expenses
of litigation arising out of or resulting from the use, ownership or
operation of any Financed Vehicle related to a Transferred Receivable.
(c) The Servicer shall indemnify, defend and hold harmless each
Indemnified Party from and against any taxes that may at any time be
asserted against such Indemnified Party with respect to the transactions
contemplated in this Agreement, including, without limitation, any sales,
gross receipts, general corporation, tangible personal property,
privilege or license taxes (but not including any income taxes or taxes
asserted with respect to, and as of the date of, the sale of the
Receivables to the Borrower) and costs and expenses in defending against
the same.
(d) The Servicer shall indemnify, defend and hold harmless each
Indemnified Party from and against any and all costs, expenses, losses,
claims, penalties, fines, forfeitures, judgments, damages and liabilities
to the extent that such cost, expense, loss, claim, penalty, fine,
forfeiture, judgment, damage or liability arose out of, or was imposed
upon such Indemnified Party by reason of the breach of this Agreement or
any other Transaction Document to which it is party by the Servicer, the
negligence (other than good faith errors in judgment made in the course
of servicing the Receivables), misfeasance, or bad faith of the Servicer
in the performance of its duties under this Agreement or by reason of
negligent disregard of its obligations and duties under this Agreement.
(e) Indemnification under this SECTION 12.1 shall survive the
termination of this Agreement and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Servicer has made
any indemnity payments pursuant to this SECTION 12.1 and the recipient
thereafter collects any of such amounts from others, the recipient shall
promptly repay such amounts collected to the Servicer, without interest.
(f) Notwithstanding the indemnity provisions contained in
SECTIONS 12.1(b) through (e), the Servicer shall not be required to
indemnify any Indemnified Party against any costs, expenses, losses,
damages, claims or liabilities to the extent the same shall have been (i)
caused by the misfeasance, bad faith or gross negligence of such party,
or (ii) suffered by reason of uncollectible or uncollected Receivables
not caused by the Servicer's negligence (other than good faith errors in
judgment made in the course of servicing the Receivables), misfeasance or
bad faith.
(g) If for any reason (other than the exclusions (i) and (ii)
set forth in SECTION 12.1(f)) the indemnification provided above in
SECTION 12.1 is unavailable to an Indemnified Party or is insufficient to
hold an Indemnified Party harmless, then the Servicer shall contribute to
the amount paid or payable by such Indemnified Party as a result of such
loss, claim, damage or liability in such proportion as is appropriate to
reflect not only the relative benefits received by such Indemnified
Party, on the one hand, and the Servicer, on the other hand, but also the
relative fault of such Indemnified Party, on the one hand, and the
Servicer, on the other hand, as well as any other relevant equitable
considerations.
(h) Notwithstanding anything to the contrary contained in this
Agreement, the successor Servicer, if Norwest, shall have no liability or
obligation with respect to any Servicer indemnification obligations other
than those set forth in subsection (d) hereof due to the gross
negligence, wilful misfeasance or bad faith of the successor Servicer in
the performance of its duties under this Agreement.
SECTION 12.2 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, THE SERVICER OR BACKUP SERVICER.
(a) The Servicer shall not merge or consolidate with any other
Person, convey, transfer or lease substantially all its assets as an
entirety to another Person, or permit any other Person to become the
successor to the Servicer's business unless, after the merger,
consolidation, conveyance, transfer, lease or succession, the successor
or surviving entity shall be an Eligible Servicer, shall be acceptable to
the Agent and the Required Lenders and shall be capable of fulfilling the
duties of the Servicer contained in this Agreement. Any Person (i) into
which the Servicer may be merged or consolidated, (ii) resulting from any
merger or consolidation to which the Servicer shall be a party,
(iii) which acquires by conveyance, transfer, or lease substantially all
of the assets of the Servicer, or (iv) succeeding to the business of the
Servicer, in any of the foregoing cases shall execute an agreement of
assumption to perform every obligation of the Servicer under this
Agreement and the other Transaction Documents and, whether or not such
assumption agreement is executed, shall be the successor to the Servicer
under this Agreement and the other Transaction Documents without the
execution or filing of any paper or any further act on the part of any of
the parties to this Agreement, anything in this Agreement to the contrary
notwithstanding; PROVIDED, HOWEVER, that nothing contained herein shall
be deemed to release the Servicer from any obligation hereunder. The
Servicer shall provide notice of any merger, consolidation or succession
pursuant to this SECTION 12.2(a) to the Agent, the Backup Servicer and
the Collateral Agent. Notwithstanding the foregoing, as a condition to
the consummation of the transactions referred to in CLAUSES (i), (ii),
(iii) and (iv) above, (x) immediately after giving effect to such
transaction, no representation or warranty made pursuant to SECTION 8.6
shall have been breached in any material respect (for purposes hereof,
such representations and warranties shall speak as of the date of the
consummation of such transaction) and no Facility Termination Event or
Unmatured Facility Termination Event shall have occurred and be
continuing, (y) the Servicer shall have delivered to the Agent an
Officer's Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption
comply with this SECTION 12.2(a), and (z) the Servicer shall have
delivered to the Agent an Opinion of Counsel, stating, in the opinion of
such counsel, either
(A) all financing statements and continuation statements and amendments
thereto have been executed and filed that are necessary to preserve and
protect the security interest of the Collateral Agent (for the benefit of
the Secured Parties) in the Transferred Receivables and other Borrower
Collateral and reciting the details of the filings or (B) no such action
shall be necessary to preserve and protect such interest.
(b) Any Person (i) into which the Backup Servicer may be merged
or consolidated, (ii) resulting from any merger or consolidation to which
the Backup Servicer shall be a party, (iii) which acquires by conveyance,
transfer or lease substantially all of the assets of the Backup Servicer,
or (iv) succeeding to the business of the Backup Servicer, in any of the
foregoing cases shall execute an agreement of assumption to perform every
obligation of the Backup Servicer under this Agreement and, whether or
not such assumption agreement is executed, shall be the successor to the
Backup Servicer under this Agreement without the execution or filing of
any paper or any further act on the part of any of the parties to this
Agreement, anything in this Agreement to the contrary notwithstanding;
PROVIDED, HOWEVER, that nothing contained herein shall be deemed to
release the Backup Servicer from any obligation.
SECTION 12.3 LIMITATION ON LIABILITY OF SERVICER, BACKUP SERVICER
AND OTHERS.
(a) Neither the Servicer, the Backup Servicer nor any of the
directors or officers or employees or agents of the Servicer or Backup
Servicer shall be under any liability to the Borrower, the Investors or
the Agent, except as provided in this Agreement, for any action taken or
for refraining from the taking of any action pursuant to this Agreement;
PROVIDED, HOWEVER, that this provision shall not protect the Servicer,
the Backup Servicer or any such person against any liability that would
otherwise be imposed by reason of a breach of this Agreement or willful
misfeasance, bad faith or negligence (other than good faith errors in
judgment made in the course of servicing the Receivables) in the
performance of duties. The Servicer, the Backup Servicer and any
director, officer, employee or agent of the Servicer or Backup Servicer
may rely in good faith on the written advice of counsel or on any
document of any kind PRIMA FACIE properly executed and submitted by any
Person respecting any matters arising under this Agreement. The Backup
Servicer shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if
the repayment of such funds or adequate written indemnity against such
risk or liability is not reasonably assured to it in writing prior to the
expenditure or risk of such funds or incurrence of financial liability.
(b) Unless acting as Servicer hereunder, the Backup Servicer
shall not be liable for any obligation of the Servicer contained in this
Agreement, and the Agent, the Borrower and the Investors shall look only
to the Servicer to perform such obligations.
(c) The parties hereto and each Investor, by its acceptance of
any interest in the Note or any Advance, or in any portion of any
Lender's commitment to make Advances, expressly acknowledge and consent
to Norwest acting in the dual capacity of Backup Servicer or successor
Servicer and in the capacity as Collateral Agent. Norwest may, in such
dual capacity, discharge its separate functions fully, without hindrance
or regard to conflict of
interest principles, duty of loyalty principles or other breach of
fiduciary duties to the extent that any such conflict or breach arises
from the performance by Norwest of express duties set forth in this
Agreement in any of such capacities, all of which defenses, claims or
assertions are hereby expressly waived by the other parties hereto except
in the case of gross negligence and willful misconduct by Norwest.
(d) The Backup Servicer shall have no responsibility and shall
not be in default hereunder nor incur any liability for any failure,
error, malfunction or any delay in carrying out any of its duties under
this Agreement if any such failure or delay results from the Backup
Servicer acting in accordance with information prepared or supplied by a
Person other than the Backup Servicer or the failure of any such Person
to prepare or provide such information. The Backup Servicer shall have
no responsibility, shall not be in default and shall incur no liability
(i) for any act or failure to act by any third party, including the
Servicer or for any inaccuracy or omission in a notice or communication
received by the Backup Servicer from any third party or (ii) that is due
to or results from the invalidity, unenforceability of any Receivable
under applicable law or the breach or the inaccuracy of any
representation or warranty made with respect to any Receivable.
SECTION 12.4 DELEGATION OF DUTIES. So long as AFL is the
Servicer, the Servicer may delegate duties under this Agreement to an
Affiliate of AFL with the prior written consent of the Agent and the
Backup Servicer. The Servicer also may at any time perform the specific
duties of (a) repossession of Financed Vehicles, (b) tracking the
insurance on Financed Vehicles and (c) pursuing the collection of
deficiency balances on Delinquent Receivables through sub-contractors who
are in the business of servicing automotive receivables, without the
consent of the Agent, the Lenders or the Backup Servicer. The Servicer
may also perform other non-material specific duties through such
sub-contractors in accordance with customary servicing policies and
procedures without the prior consent of the Agent; PROVIDED, HOWEVER,
that no such delegation or subcontracting of duties by the Servicer shall
relieve the Servicer of its responsibility with respect to such duties.
Neither AFL nor any other party acting as Servicer hereunder shall
appoint any subservicer hereunder without the prior written consent of
the Agent and the Backup Servicer. If the Backup Servicer assumes the
role of successor Servicer, such successor Servicer may delegate its
duties under this Agreement to any Person or appoint a subservicer with
the prior consent of the Agent.
SECTION 12.5 SERVICER AND BACKUP SERVICER NOT TO RESIGN. Subject
to the provisions of SECTION 12.2, neither the Servicer nor the Backup
Servicer shall resign from the obligations and duties imposed on it by
this Agreement as Servicer or Backup Servicer except upon a determination
that by reason of a change in legal requirements the performance of its
duties under this Agreement would cause it to be in violation of such
legal requirements in a manner which would result in a material adverse
effect on the Servicer or the Backup Servicer, as the case may be, and
the Agent does not elect to waive the obligations of the Servicer or the
Backup Servicer, as the case may be, to perform the duties which render
it legally unable to act or to delegate those duties to another Person.
Any such determination permitting the resignation of the Servicer or
Backup Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered and acceptable to the Agent. No resignation of the
Servicer shall become effective until the Backup Servicer or an entity
acceptable to the
Agent and the Required Lenders shall have assumed the responsibilities
and obligations of the Servicer. No resignation of the Backup Servicer
shall become effective until an entity acceptable to the Agent and the
Required Lenders shall have assumed the responsibilities and obligations
of the Backup Servicer; PROVIDED, HOWEVER, that in the event a successor
Backup Servicer is not appointed within 60 days after the Backup Servicer
has given notice of its resignation as permitted by this SECTION 12.5,
the Backup Servicer may petition a court for its removal.
Notwithstanding the foregoing, the Backup Servicer may resign for any
reason, provided an entity acceptable to the Agent and the Required
Lenders shall have assumed the responsibilities and obligations of the
Backup Servicer prior to the effectiveness of any such resignation.
ARTICLE XIII
SERVICER TERMINATION EVENTS
SECTION 13.1 SERVICER TERMINATION EVENT. For purposes of this
Agreement, each of the following shall constitute a "SERVICER TERMINATION
EVENT":
(a) Any failure by the Servicer or, so long as AFL or an
Affiliate of the Borrower is the Servicer, the Borrower to deliver to the
Collateral Agent or Agent any proceeds or payment required to be so
delivered under the terms of this Agreement (or, if AFL or an Affiliate
of the Borrower is the Servicer, under the Purchase Agreement) that
continues unremedied for a period of two Business Days (or, with respect
to any Purchase Amounts, one Business Day) after written notice is
received by the Servicer from the Agent or after discovery of such
failure by a Responsible Officer of the Servicer;
(b) Failure by the Servicer to deliver the Servicer's
Certificate required by SECTION 8.9 by 12:00 Noon, New York City time, on
the second Business Day after each Determination Date;
(c) Failure on the part of the Servicer to observe in all
material aspects its covenants and agreements set forth in SECTION
12.2(a);
(d) Failure on the part of the Servicer or, so long as AFL or
an Affiliate of the Borrower is the Servicer, the Borrower, duly to
observe or perform in any material respect any other covenants or
agreements of the Servicer or, so long as AFL is the Servicer, the
Borrower, as the case may be, set forth in this Agreement, which failure
continues unremedied for a period of 30 days after the earlier of
knowledge thereof by a Responsible Officer of the Servicer and the date
on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Servicer by the Agent;
(e) The entry of a decree or order for relief by a court or
regulatory authority having jurisdiction in respect of the Servicer (or
the Borrower) in an involuntary case under the Bankruptcy Code, as now or
hereafter in effect, or another present or future, federal or state,
bankruptcy, insolvency or similar law, or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of the Servicer (or the Borrower) or of
any substantial part of their respective properties or ordering the
winding up or liquidation of the affairs of the Servicer (or the
Borrower) or the commencement of an involuntary case under the Bankruptcy
Code, as now or hereinafter in effect, or another present or future
federal or state bankruptcy, insolvency or similar law and such case is
not dismissed within 60 days;
(f) The commencement by the Servicer (or, if AFL or an
Affiliate of the Borrower is the Servicer, the Borrower) of a voluntary
case under the Bankruptcy Code, as now or hereafter in effect, or any
other present or future, federal or state, bankruptcy, insolvency or
similar law, or the consent by the Servicer (or, if AFL or an Affiliate
of the Borrower is the Servicer, the Borrower) to the appointment of or
taking possession by a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Servicer (or, if
AFL or an Affiliate of the Borrower is the Servicer, the Borrower) or of
any substantial part of its property or the making by the Servicer (or,
if AFL or an Affiliate of the Borrower is the Servicer, the Borrower) of
an assignment for the benefit of creditors or the failure by the Servicer
(or, if AFL or an Affiliate of the Borrower is the Servicer, the
Borrower) generally to pay its debts as such debts become due or the
taking of corporate action by the Servicer (or, if AFL or an Affiliate of
the Borrower is the Servicer, the Borrower) in furtherance of any of the
foregoing;
(g) Any representation, warranty or statement of the Servicer
(or, if AFL or an Affiliate of the Borrower is the Servicer, the
Borrower) made in this Agreement or any certificate, report or other
writing delivered pursuant hereto shall prove to be incorrect in any
material respect as of the time when the same shall have been made
(excluding, however, any representation or warranty set forth in the
definition of "ELIGIBLE RECEIVABLE"), and, within 30 days after the
earlier of knowledge thereof by a Responsible Officer of the Servicer and
the date written notice thereof shall have been given to the Servicer by
the Agent, the circumstances or condition in respect of which such
representation, warranty or statement was incorrect shall not have been
eliminated or otherwise cured;
(h) The Agent shall not have delivered a Servicer Extension
Notice pursuant to SECTION 8.14;
(i) The average of the Servicer Delinquency Ratios for the last
day of each of the preceding three Collection Periods exceeds 7%; or
(j) The Portfolio Net Loss Ratio exceeds 6%.
SECTION 13.2 CONSEQUENCES OF A SERVICER TERMINATION EVENT. If a
Servicer Termination Event shall occur and be continuing, the Agent may,
and, upon the direction of the Required Lenders, the Agent shall, by
written notice given to the Servicer, terminate all of the rights and
obligations of the Servicer under this Agreement. On or after the
receipt by the Servicer of such written notice or if the Agent shall not
have delivered a Servicer Extension Notice pursuant to SECTION 8.14, all
authority, power, obligations and responsibilities of the Servicer under
this Agreement automatically shall pass to, be vested in and become
obligations and responsibilities of the Backup Servicer; PROVIDED,
HOWEVER, that
the Backup Servicer shall have no liability with respect to any
obligation which was required to be performed by the prior Servicer prior
to the date that the Backup Servicer becomes the Servicer or any claim of
a third party based on any alleged action or inaction of the prior
Servicer. The Backup Servicer is authorized and empowered by this
Agreement to execute and deliver, on behalf of the prior Servicer, as
attorney-in-fact or otherwise, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such termination, whether to
complete the transfer and endorsement of the Transferred Receivables and
related documents to show the Collateral Agent (for the benefit of the
Secured Parties) as lienholder or secured party, or otherwise. The prior
Servicer agrees to cooperate with the Backup Servicer in effecting the
termination of the responsibilities and rights of the prior Servicer
under this Agreement, including, without limitation and at the prior
Servicer's expense, the transfer to the Backup Servicer for
administration by it of all cash amounts that shall at the time be held
by the prior Servicer for deposit, or have been deposited by the prior
Servicer, in the Collection Account or thereafter received with respect
to the Transferred Receivables and the delivery to the Backup Servicer of
all Receivable Files, Monthly Records and Collection Records and a
computer tape in readable form containing all information necessary to
enable the Backup Servicer or a successor Servicer to service the
Transferred Receivables. In addition, upon the occurrence of a Servicer
Termination Event, the Servicer shall, if so requested by the Agent,
deliver to the Backup Servicer its Monthly Records within five days after
demand therefor and a computer tape or diskette (or any other means of
electronic transmission acceptable to the Backup Servicer) containing as
of the close of business on the date of demand all of the data maintained
by the Servicer in computer format in connection with servicing the
Transferred Receivables. If requested by the Agent, the Backup Servicer
or successor Servicer shall terminate the Lockbox Agreement with respect
to the Transferred Receivables and direct the Obligors to make all
payments under the Transferred Receivables directly to the successor
Servicer (in which event the successor Servicer shall process such
payments in accordance with SECTION 8.2(e)), or to a lockbox established
by the successor Servicer at the direction of the Agent, at the prior
Servicer's expense. The terminated Servicer shall grant the Agent and
the Backup Servicer reasonable access to the terminated Servicer's
premises at the terminated Servicer's expense.
SECTION 13.3 APPOINTMENT OF SUCCESSOR SERVICER.
(a) On and after (i) the time the Servicer receives a notice of
termination pursuant to SECTION 13.2 or (ii) upon the resignation of the
Servicer pursuant to SECTION 12.5 or (iii) the receipt by the Backup
Servicer (or any alternate successor Servicer appointed pursuant to
SECTION 13.3(b)) of written notice from the Agent that the Agent is not
extending the Servicer's term pursuant to SECTION 8.14, the Backup
Servicer shall be the successor in all respects to the Servicer in its
capacity as servicer under this Agreement and the transactions set forth
or provided for in this Agreement and shall be subject to all the
responsibilities, restrictions, duties, liabilities and termination
provisions relating thereto placed on the Servicer by the terms and
provisions of this Agreement; PROVIDED, HOWEVER, that the Backup Servicer
shall not be liable for any acts, omissions or obligations of the
Servicer prior to such succession or for any breach by the Servicer of
any of its representations and warranties contained in this Agreement or
in any related document. The Servicer and such successor
shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. If a successor Servicer is
acting as Servicer hereunder, it shall be subject to termination under
SECTION 13.2 upon the occurrence of any Servicer Termination Event
applicable to it as Servicer.
(b) The Agent (with the consent of the Required Lenders) may
exercise at any time its right to appoint as Backup Servicer or as
successor to the Servicer a person other than the Person serving as
Backup Servicer at the time and shall have no liability to the Investors,
the Borrower, AFL, the Person then serving as Backup Servicer or any
other Person if it does so. Notwithstanding the above, if the Backup
Servicer shall be legally unable or unwilling to act as Servicer and the
Agent shall fail to appoint a successor Servicer within 60 days of its
receipt of notice from the Backup Servicer to such effect, the Backup
Servicer may petition a court of competent jurisdiction to appoint any
Eligible Servicer as the successor to the Servicer. Pending such
appointment, the Backup Servicer shall act as successor Servicer unless
it is legally unable to do so, in which event the outgoing Servicer shall
continue to act as Servicer until a successor has been appointed and
accepted such appointment. Subject to SECTION 12.5, no provision of this
Agreement shall be construed as relieving the Backup Servicer of its
obligation to succeed as successor Servicer upon the termination of the
Servicer pursuant to SECTION 13.2, the resignation of the Servicer
pursuant to SECTION 12.5 or the non-extension of the servicing term of
the Servicer pursuant to SECTION 8.14. If, upon the termination of the
Servicer pursuant to SECTION 13.2 or 8.14 or the resignation of the
Servicer pursuant to SECTION 12.5, the Agent (with the consent of the
Required Lenders) appoints a successor Servicer other than the Backup
Servicer, the Backup Servicer shall not be relieved of its duties as
Backup Servicer hereunder.
(c) Any successor Servicer appointed pursuant to this
SECTION 13 shall be entitled to compensation based upon a rate equal to
the greater of the (a) Servicing Fee Rate and (b) the then-current fee
for servicing assets comparable to the Receivables, which rate shall be
determined by averaging three servicing fee bids obtained by the Backup
Servicer from third party servicers selected by the Backup Servicer (the
"MARKET RATE SERVICING FEE RATE"). In addition, any successor Servicer
shall be entitled to receive Transition Costs in accordance with the
Collateral Agent Agreement.
(d) The successor Servicer, if Norwest, its successors or
assigns, shall have (i) no liability with respect to any obligation which
was required to be performed by the terminated Servicer prior to the date
that the successor Servicer becomes the Servicer or any claim of a third
party based on any alleged action or inaction of the terminated Servicer,
(ii) no obligation to perform any repurchase or advancing obligations, if
any, of the Servicer, (iii) no obligation to pay any taxes required to be
paid by the Servicer and (iv) no obligation to pay any of the fees and
expenses of any other party involved in this transaction. NO SUCCESSOR
SERVICER SHALL BE REQUIRED TO MAKE THE REPRESENTATION SET FORTH IN
SECTION 8.6(b)(ix).
ARTICLE XIV
FACILITY TERMINATION EVENTS; THEIR EFFECT
SECTION 14.1 FACILITY TERMINATION EVENTS. Each of the following
shall constitute a Facility Termination Event under this Agreement:
(a) Default in the payment when due of any principal of any
Advance, which default shall continue unremedied for one Business Day, or
default in the payment of any other amount payable by the Borrower
hereunder, including, without limitation, any Yield on any Advance or any
Fees which default shall continue for one Business Day; or the Borrower
shall fail to comply with the Clean-Up Requirement during any Clean-Up
Period;
(b) The Borrower or AFL (in any capacity) shall fail to perform
or observe any other term, covenant or agreement contained in this
Agreement or in any other Transaction Document on its part to be
performed or observed and, except in the case of the covenants and
agreements contained in SECTIONS 11.7 and 11.8, as to each of which no
grace period shall apply, any such failure shall remain unremedied for 30
days (one Business Day in the case of SECTION 11.6) after knowledge
thereof or after written notice thereof shall have been given by the
Agent to the Borrower;
(c) Any representation or warranty of the Borrower or AFL (in
any capacity) made or deemed to have been made hereunder or in any other
Transaction Document or any other writing or certificate furnished by or
on behalf of the Borrower to the Agent or the Lenders for purposes of or
in connection with this Agreement or any other Transaction Document
(including any certificates delivered pursuant to SECTION 7.2(j), any
Servicer's Certificate or any Borrowing Base Confirmation delivered
pursuant to SECTION 7.2(g)) shall prove to have been false or incorrect
in any material respect when made or deemed to have been made; PROVIDED
that no breach shall be deemed to occur hereunder in respect of any
representation or warranty relating to any Eligible Receivable to the
extent AFL or the Servicer has repurchased the related Receivable in
accordance with the provisions hereof or of the Purchase Agreement;
(d) An Event of Bankruptcy shall have occurred and remain
continuing with respect to the Borrower or AFL;
(e) The aggregate principal amount of all Advances outstanding
hereunder (after giving effect to all distributions in respect of
principal to be made on the date of determination) exceeds the Borrowing
Base and such condition continues unremedied for one Business Day (such
excess referred to as the "BORROWING BASE DEFICIENCY");
(f) The Internal Revenue Service shall file notice of a lien
pursuant to Section 6323 of the Internal Revenue Code with regard to any
of the assets of the Borrower or AFL and such lien shall not have been
released within 30 days, or the Pension Benefit Guaranty Corporation
shall file notice of a lien pursuant to Section 4068 of ERISA with regard
to any of the assets of the Borrower or AFL and such lien shall not have
been released within 30 days;
(g) (i) Any Transaction Document or any Lien granted
thereunder by the Borrower, shall (except in accordance with its terms),
in whole or in part, terminate, cease to
be effective or cease to be the legally valid, binding and enforceable
obligation of the Borrower; or (ii) the Borrower or any other party
shall, directly or indirectly, contest in any manner such effectiveness,
validity, binding nature or enforceability; or (iii) any Lien securing
any Obligation shall, in whole or in part, cease to be a perfected first
priority security interest against the Borrower (except for any tax or
mechanic's Liens that may arise with respect to any Financed Vehicle
after its related Purchase Date);
(h) A Servicer Termination Event shall have occurred;
(i) On any Determination Date, the Delinquency Ratio averaged
for such Determination Date and the three immediately preceding
Determination Dates exceeds 2.5%;
(j) The Borrower or AFL shall fail to pay any principal of or
premium or interest on any Indebtedness having a principal amount of
$10,000,000 or greater, when the same becomes due and payable (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace
period, if any, specified in the agreement or instrument relating to such
Indebtedness; or any other default under any agreement or instrument
relating to any such Indebtedness of the Borrower or AFL, as applicable,
or any other event, shall occur and shall continue after the applicable
grace period, if any, specified in such agreement or instrument if the
effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or any such
Indebtedness shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled required prepayment),
redeemed, purchased or defeased, or an offer to prepay, redeem, purchase
or defease such Indebtedness shall be required to be made, in each case,
prior to the stated maturity thereof;
(k) There shall occur a "termination event"or "event of
default" or similar event under any other Transaction Document;
(l) Either (i) the long-term senior unsecured debt of AFL is
rated by either S&P or ▇▇▇▇▇'▇ below B- or B3, respectively, or (ii) if
AFL is not so rated, the Agent, acting at the direction of the Required
Lenders, deems the creditworthiness of AFL to be the equivalent thereof;
(m) AFL shall cease to directly own 100% of the outstanding
capital stock of the Borrower;
(n) Net Yield as of the last day of any Collection Period is
less than 1.0%;
(o) As of any Distribution Date, the amount in the Reserve
Account is less than the Minimum Reserve Account Amount, and such
deficiency is not cured on or prior to the immediately succeeding
Distribution Date;
(p) This Agreement and the Advances hereunder are not rated
"A/A2" by S&P and ▇▇▇▇▇'▇ within 60 days after the Closing Date or after
such rating is granted, the same is reduced or withdrawn by S&P or
▇▇▇▇▇'▇; or
(q) A notice of termination with respect to the Lockbox
Agreement with respect to the Transferred Receivables shall have been
delivered, or a termination of the Lockbox Agreement shall have otherwise
occurred, and a replacement Lockbox Bank acceptable to the Agent shall
not have executed a Lockbox Agreement with respect to the Transferred
Receivables in form and substance satisfactory to the Agent within 30
days of such notice.
SECTION 14.2 EFFECT OF FACILITY TERMINATION EVENT.
(a) OPTIONAL TERMINATION. Upon the occurrence of a Facility
Termination Event (other than a Facility Termination Event described in
SECTION 14.1(d)), the Agent may, and, at the direction of the Required
Lenders, the Agent shall declare all or any portion of the outstanding
principal amount of the Advances and other Obligations to be due and
payable and/or the Facility (if not theretofore terminated) to be
terminated, whereupon the full unpaid amount of such Advances and other
Obligations which shall be so declared due and payable shall be and
become immediately due and payable, without further notice, demand or
presentment, and/or, as the case may be, the Facility (and the
Commitments of the Banks, if any, thereunder) shall terminate.
(b) AUTOMATIC TERMINATION. Upon the occurrence of a Facility
Termination Event described in SECTION 14.1(d) or a Servicer Termination
Event described in SECTION 13.1(i), the Facility Termination Date shall
be deemed to have occurred automatically, and all outstanding Advances
under this Agreement and all other Obligations under this Agreement shall
become immediately and automatically due and payable, all without
presentment, demand, protest, or notice of any kind.
SECTION 14.3 CERTAIN RIGHTS UPON FACILITY TERMINATION EVENT.
(a) In addition to the rights and remedies specified in SECTION
14.2, if a Facility Termination Event shall have occurred and be
continuing, the Agent may direct the Collateral Agent to exercise any of
the remedies specified in the Collateral Agent Agreement or available to
the Collateral Agent as a secured party under the UCC in respect of the
Borrower Collateral (or any portion thereof).
(b) The rights and remedies provided to the Collateral Agent,
the Agent and the Secured Parties herein and in the other Transaction
Documents are cumulative and not exclusive of any other rights and
remedies the Collateral Agent, the Agent and the Secured Parties may have
under applicable law.
(c) If a Facility Termination Event shall have occurred and be
continuing, then at any time after the acceleration of the maturity of
the Advances and other Obligations has been made and before a judgment or
decree for payment of the money due has been obtained by the Agent as
hereinafter provided, the Required Lenders, by written notice to the
Borrower and the Agent, may rescind and annul such declaration and its
consequences if:
(i) the Borrower has paid or deposited with the Agent a
sum sufficient to pay
(A) all payments of principal of and Yield on the Advances and all
other amounts that would then be due hereunder or if the Facility Termination
Event giving rise to such acceleration had not occurred; and
(B) all sums paid or advanced by the Agent hereunder and the
reasonable compensation, expenses, disbursements and advances of the Agent and
its agents and counsel; and
(ii) all Facility Termination Events, other than the
nonpayment of the principal of the Advances that has become due solely by such
acceleration, have been cured or waived.
No such rescission shall affect any subsequent default or
impair any right consequent thereto.
ARTICLE XV
THE AGENT
SECTION 15.1 APPOINTMENT. Each Lender hereunder hereby
irrevocably designates and appoints CSFB as Agent hereunder, and
authorizes the Agent to take such action on its behalf under the
provisions of this Agreement and the other Transaction Documents and to
exercise such powers and perform such duties as are expressly delegated
to the Agent by the terms of this Agreement and the other Transaction
Documents, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Agent shall not have any duties or responsibilities,
except those expressly set forth herein, or any fiduciary relationship
with any Lender, and no implied covenants, functions, responsibilities,
duties, obligations or liabilities on the part of the Agent to any Lender
shall be read into this Agreement or the other Transaction Documents or
shall otherwise exist against the Agent. In performing its functions and
duties hereunder, the Agent shall act solely as the agent of the Lenders,
and the Agent does not assume, nor shall be deemed to have assumed, any
obligation or relationship of trust or agency with or for any such
Person.
SECTION 15.2 DELEGATION OF DUTIES. The Agent may execute any of
its duties under this Agreement by or through its subsidiaries,
affiliates, agents or attorneys-in-fact and shall be entitled to advice
of counsel concerning all matters pertaining to such duties. The Agent
shall not be responsible to any Lender for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care.
SECTION 15.3 EXCULPATORY PROVISIONS. Neither the Agent (acting
in such capacity) nor any of its directors, officers, agents or employees
shall be (a) liable for any action lawfully taken or omitted to be taken
by it or them or any Person described in SECTION 15.2 under or in
connection with this Agreement or the other Transaction Documents (except
for its, their or such Person's own gross negligence or willful
misconduct), or (b) responsible in any manner to any Person for any
recitals, statements, representations or warranties of any Person (other
than itself) contained in the Transaction Documents or in any
certificate, report,
statement or other document referred to or provided for in, or received
under or in connection with, the Transaction Documents or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of
the Transaction Documents or any other document furnished in connection
therewith or herewith, or for any failure of any Person (other than
itself or its directors, officers, agents or employees) to perform its
obligations under any Transaction Document or for the satisfaction of any
condition specified in a Transaction Document. Except as otherwise
expressly provided in this Agreement, the Agent shall not be under any
obligation to any Person to ascertain or to inquire as to the observance
or performance of any of the agreements or covenants contained in, or
conditions of, the Transaction Documents, or to inspect the properties,
books or records of the Borrower, the AFL or the Servicer.
SECTION 15.4 RELIANCE BY AGENT. The Agent shall in all cases be
entitled to rely, and shall be fully protected in relying, upon any note,
writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement,
order or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or
Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to each of the Lenders), independent
accountants and other experts selected by the Agent. The Agent shall in
all cases be fully justified in failing or refusing to take any action
under this Agreement, any other Transaction Document or any other
document furnished in connection herewith or therewith unless it shall
first receive such advice or concurrence of the Lenders, as it deems
appropriate, or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability, cost and expense which may be
incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement, the other Transaction
Documents or any other document furnished in connection herewith or
therewith in accordance with a request of the Required Lenders, and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders.
SECTION 15.5 ACTION UPON CERTAIN EVENTS; REPORTS AND NOTICES.
(a) To the extent the Agent is entitled to consent to or
withhold its consent of any waiver or amendment of this Agreement or
other Transaction Documents in accordance with the terms hereof or
thereof, or is notified in writing by a party hereto of a Facility
Termination Event or Servicer Termination Event, the Agent shall (i) give
prompt notice to the Lenders of any such waiver, amendment, Facility
Termination Event or Servicer Termination Event of which it is aware, and
(ii) take such action with respect to such waiver, amendment, Facility
Termination Event or Servicer Termination Event as shall be directed by
the Required Lenders; PROVIDED, HOWEVER, that unless and until the Agent
shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with
respect to such waiver, amendment, Facility Termination Event or Servicer
Termination Event, as applicable, as the Agent shall, in its sole
discretion, deem advisable and in the best interests of the Lenders.
(b) The Agent shall upon request promptly provide the Lenders
with copies of reports and notices received by it hereunder and under the
Custodial Agreement and the Collateral Agent Agreement.
SECTION 15.6 NON-RELIANCE ON AGENT. The Lenders expressly
acknowledge that neither the Agent, nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by the Agent
hereafter taken, including, without limitation, any review of the affairs
of either the Borrower, the AFL, the Servicer or the Backup Servicer,
shall be deemed to constitute any representation or warranty by the Agent
to any Lender. Except as expressly provided herein, the Agent shall not
have any duty or responsibility to provide any Lender with any credit or
other information concerning the Borrower Collateral or the business,
operations, property, prospects, financial and other condition or
creditworthiness of the Borrower, the AFL, the Servicer, the Lenders or
the Backup Servicer which may come into the possession of the Agent or
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.
SECTION 15.7 INDEMNIFICATION. The Banks agree to indemnify the
Agent and its officers, directors, employees, representatives and agents
(to the extent not reimbursed by the Borrower, the Servicer or AFL under
the Transaction Documents, and without limiting the obligation of such
Persons to do so in accordance with the terms of the Transaction
Documents), ratably according to their Commitment Percentages, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
or nature whatsoever (including, without limitation, the reasonable fees
and disbursements of counsel for the Agent or the affected Person in
connection with any investigative, or judicial proceeding commenced or
threatened, whether or not the Agent or such affected Person shall be
designated a party thereto) that may at any time be imposed on, incurred
by or asserted against the Agent or such affected Person as a result of,
or arising out of, or in any way related to or by reason of, any of the
transactions contemplated hereunder or under the Transaction Documents or
any other document furnished in connection herewith or therewith (but
excluding any such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting
solely from the gross negligence or willful misconduct of the Agent or
such affected Person).
SECTION 15.8 SUCCESSOR AGENT. The Agent may, upon five (5) days'
notice to the Lenders (with a copy to the Borrower), resign as Agent;
PROVIDED, in either case, that a Lender agrees to become the successor
Agent hereunder in accordance with the next sentence. If the Agent shall
resign as Agent under this Agreement, then the Required Lenders during
such period shall appoint from among the Banks a successor agent,
whereupon such successor agent shall succeed to the rights, powers and
duties of the Agent, and the term "Agent" shall mean such successor
agent, effective upon its acceptance of such appointment, and the former
Agent's rights, powers and duties as Agent shall be terminated, without
any other or further act or deed on the part of such former Agent or any
of the parties to this Agreement. After the retiring Agent's resignation
hereunder as Agent, the provisions of this ARTICLE XV shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.
SECTION 15.9 LIABILITY OF THE AGENT. Notwithstanding any
provision of this Agreement or any other Transaction Document: (i) the
Agent shall not have any obligations
under this Agreement or any other Transaction Document other than those
specifically set forth herein and therein, and no implied obligations of
the Agent shall be read into this Agreement or any other Transaction
Document; and (ii) in no event shall the Agent be liable under or in
connection with this Agreement or any other Transaction Document for
indirect, special, or consequential losses or damages of any kind,
including lost profits, even if advised of the possibility thereof and
regardless of the form of action by which such losses or damages may be
claimed. Neither the Agent nor any of its respective directors,
officers, agents or employees shall be liable for any action taken or
omitted to be taken in good faith by it or them under or in connection
with this Agreement or any other Transaction Document, except for its or
their own gross negligence or willful misconduct. Without limiting the
foregoing, the Agent (a) may consult with legal counsel (including
counsel for the Lenders, the Borrower or the Servicer), independent
public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants or experts, (b)
shall not be responsible to the Lenders, the Borrower, the AFL, the
Servicer or the Backup Servicer for any statements, warranties or
representations (other than its own statements) made in or in connection
with this Agreement or the other Transaction Documents, (c) shall not be
responsible to the Lenders, the Borrower, the AFL, the Servicer or the
Backup Servicer for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of this Agreement or
the other Transaction Documents (other than the legality, validity,
enforceability or genuineness of its own execution, authorization and
performance hereof and thereof), (d) shall incur no liability under or in
respect of any of the commercial paper or other obligations of the
Lenders under this Agreement or the other Transaction Documents and
(e) shall incur no liability under or in respect of this Agreement or the
other Transaction Documents by acting upon any notice (including notice
by telephone), consent, certificate or other instrument or writing (which
may be by facsimile) believed by it to be genuine and signed or sent by
the proper party or parties. Notwithstanding anything else herein or in
the other Transaction Documents, it is agreed that where the Agent may be
required under this Agreement or the other Transaction Documents to give
notice of any event or condition or to take any action as a result of the
occurrence of any event or the existence of any condition, the Agent
agrees to give such notice or take such action only to the extent that it
has actual knowledge of the occurrence of such event or the existence of
such condition, and shall incur no liability for any failure to give such
notice or take such action in the absence of such knowledge.
SECTION 15.10 AGENT AND AFFILIATES. The Agent and any of its
Affiliates may generally engage in any kind of business with the
Borrower, the Servicer, AFL, the Backup Servicer, any Obligor, any of
their respective Affiliates and any Person who may do business with or
own securities of the Borrower, the Servicer, AFL, the Backup Servicer,
any Obligor or any of their respective Affiliates, all as if the Agent
were not the Agent hereunder and without any duty to account therefor to
any Lender.
ARTICLE XVI
ASSIGNMENTS
SECTION 16.1 RESTRICTIONS ON ASSIGNMENTS. Except as specifically
provided herein (with respect to the Servicer and the Backup Servicer),
neither the Borrower, the Servicer, AFL nor Norwest may assign any of
their respective rights or obligations hereunder or any interest herein
without the prior written consent of the Agent and the Lender or, in the
case of Norwest, the Agent and the Required Lenders. No Lender may
assign its rights or obligations hereunder, any Advance or the Note (or
any portion thereof) to any Person without the prior written consent of
the Borrower and the Agent (as to the Borrower only, such consent not to
be unreasonably withheld or delayed); PROVIDED, HOWEVER, that any Lender
may assign, or grant a security interest in, all or any portion of the
Advances and the Note to (i) CSFB or any of its Affiliates or another
Lender or (ii) any Person managed by CSFB or any of its Affiliates, and
(iii) any Liquidity Provider (each, an "ELIGIBLE ASSIGNEE"), in each case
under clauses (i), (ii) and (iii) above, without the prior written
consent of the Borrower; PROVIDED, FURTHER, HOWEVER, that after the
occurrence of the Facility Termination Date, any Lender may, subject to
the provisions of SECTION 16.5, assign all or a portion of the Note held
by it to a Person other than those identified in clauses (i), (ii) and
(iii) above without the prior written consent of the Borrower.
SECTION 16.2 DOCUMENTATION. Each Lender shall deliver to each
assignee an assignment, in such form as such Lender and the related
assignee may agree, duly executed by such Lender assigning any such
rights, obligations, Advance or Note to the assignee; and such Lender
shall promptly execute and deliver all further instruments and documents,
and take all further action, that the assignee may reasonably request, in
order to perfect, protect or more fully evidence the assignee's right,
title and interest in and to the items assigned, and to enable the
assignee to exercise or enforce any rights hereunder or under the Note
evidencing such Advance.
SECTION 16.3 RIGHTS OF ASSIGNEE. Upon the foreclosure of any
assignment of any Advances made for security purposes, or upon any other
assignment of any Advance from any Lender pursuant to this ARTICLE XVI,
the respective assignee receiving such assignment shall have all of the
rights of such Lender hereunder with respect to such Advances and all
references to the Lender or Investors in SECTION 6.1 shall be deemed to
apply to such assignee.
SECTION 16.4 NOTICE OF ASSIGNMENT. Each Lender shall provide
notice to the Borrower of any assignment hereunder by such Lender to any
assignee. Each Lender authorizes the Agent to, and the Agent agrees that
it shall, endorse the Note to reflect any assignments made pursuant to
this ARTICLE XVI or otherwise.
SECTION 16.5 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
(a) The Agent shall keep a register (the "NOTE REGISTER") in
which, subject to such reasonable regulations as it may prescribe, the
Agent shall provide for the registration of the Note and of transfer of
the Note. The Agent is hereby appointed "NOTE REGISTRAR" for the purpose
of registering the Note and transfers of the Note as herein provided.
(b) Each person who has or who acquired a Note shall be deemed
by the
acceptance of acquisition of such Note to have agreed to be bound by the
provisions of this SECTION 16.5. No Note may be transferred, and the
Agent shall not register the transfer of the Note, unless the proposed
transferee shall have delivered to the Agent (i) either (x) evidence
satisfactory to it that the transfer of such Note is exempt from
registration or qualification under the Securities Act of 1933, as
amended, and all applicable state securities laws and that the transfer
does not constitute a "prohibited transaction" under ERISA or (y) an
express agreement by the proposed transferee to be bound by and to abide
by the provisions of this SECTION 16.5, the restrictions noted on the
face of such Note and (ii) a properly executed Form W-9 and, in the case
of a transferee who is a foreign person (within the meaning of Section
7701(a)(5) of the Code), a properly executed Form 4224 or Form 1001
showing a zero rate of withholding.
(c) At the option of the holder thereof, the Note may be
exchanged for one or more new Notes of any authorized denominations and
of a like class and aggregate principal amount at an office or agency of
the Borrower. Whenever any Notes are so surrendered for exchange, the
Borrower shall execute and deliver (through the Agent) the new Notes
which the holder making the exchange is entitled to receive.
(d) Upon surrender for registration of transfer of any Note at
an office or agency of the Borrower, the Borrower shall execute and
deliver (through the Agent), in the name of the designated transferee or
transferees, one or more new Notes of any authorized denominations and of
a like class and aggregate principal amount.
(e) All Notes issued upon any registration of transfer or
exchange of any Note in accordance with the provisions of this Agreement
shall be the valid obligations of the Borrower, evidencing the same debt,
and entitled to the same benefits under this Agreement, as the Note(s)
surrendered upon such registration of transfer or exchange.
(f) Every Note presented or surrendered for registration of
transfer or for exchange shall (if so required by the Borrower or the
Agent) be fully endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Note Registrar, duly executed by the
holder thereof or his attorney duly authorized in writing. Each such
Note shall be accompanied by a statement providing the name of the
transferee and indicating whether the transferee is subject to income tax
backup withholding requirements and whether the transferee is the sole
beneficial owner of such Notes.
(g) No service charge shall be made for any registration of
transfer or exchange of Notes, but the Borrower may require payment from
the transferee holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any
registration of transfer of exchange of Notes, other than exchanges
pursuant to this SECTION 16.5.
(h) The holders of the Notes shall be bound by the terms and
conditions of this Agreement.
SECTION 16.6 MUTILATED, DESTROYED, LOST AND STOLEN NOTES.
(a) If any mutilated Note is surrendered to the Agent, the
Borrower shall execute and deliver (through the Agent) in exchange
therefor a new Note of like class and tenor and principal amount and
bearing a number not contemporaneously outstanding.
(b) If there shall be delivered to the Borrower and the Agent
prior to the payment of the Notes (i) evidence to their satisfaction of
the destruction, loss or theft of any Note and (ii) such security or
indemnity as may be required by them to save each of them and any agent
of either of them harmless, then, in the absence of notice to the
Borrower or the Agent that such Note has been acquired by a BONA FIDE
purchaser, the Borrower shall execute and deliver (through the Agent), in
lieu of any such destroyed, lost or stolen Note, a new Note of like
class, tenor and principal amount and bearing a number not
contemporaneously outstanding.
(c) Upon the issuance of any new Note under this SECTION 16.6,
the Borrower may require the payment from the transferor holder of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses connected therewith.
(d) Every new Note issued pursuant to this SECTION 16.6 and in
accordance with the provisions of this Agreement, in lieu of any
destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Borrower, whether or not the destroyed,
lost or stolen Note shall be at any time enforceable by anyone, and shall
be entitled to all the benefits of this Agreement equally and
proportionately with any and all other Notes duly issued hereunder.
(e) The provisions of this SECTION 16.6 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or
stolen Notes.
SECTION 16.7 PERSONS DEEMED OWNERS. The Borrower, the Servicer,
the Agent, the Collateral Agent and any agent for any of the foregoing
may treat the holder of any Note as the owner of such Note for all
purposes whatsoever, whether or not such Note may be overdue, and none of
the Borrower, the Servicer, the Agent, the Collateral Agent and any such
agent shall be affected by notice to the contrary.
SECTION 16.8 CANCELLATION. All Notes surrendered for payment or
registration of transfer or exchange shall be promptly canceled. The
Borrower shall promptly cancel and deliver to the Agent any Notes
previously authenticated and delivered hereunder which the Borrower may
have acquired in any manner whatsoever, and all Notes so delivered shall
be promptly canceled by the Borrower. No Notes shall be authenticated in
lieu of or in exchange for any Notes canceled as provided in this
SECTION 16.8, except as expressly permitted by this Agreement.
SECTION 16.9 PARTICIPATIONS.
(a) At any time and from time to time, each Lender may, in
accordance with
applicable law, at any time grant participations in all or a portion of
its Commitment and/or its interest in the Advances and other payments due
to it under this Agreement to any Person (each, a "PARTICIPANT");
PROVIDED, HOWEVER, that no participation shall be granted to any Person
unless and until the Agent and, if the proposed Participant is other than
a Person which at such time is an Eligible Assignee, the Borrower shall
have consented thereto (which consent shall not be unreasonably withheld
or delayed). Each Lender hereby acknowledges and agrees that (A) any
such participation will not alter or affect such Lender's direct
obligations hereunder, and (B) neither the Borrower, the Agent nor the
Servicer shall have any obligation to have any communication or
relationship with any Participant. Each Participant shall comply with
the provisions of SECTION 5.1(b). No Participant shall be entitled to
transfer all or any portion of its participation without the prior
written consent of the Agent and, if the proposed transferee is other
than an Eligible Assignee, the Borrower (which consent will not be
unreasonably withheld or delayed).
(b) Each Lender may pledge its interest in the Advances and the
Note to any Federal Reserve Bank as collateral in accordance with
applicable law.
ARTICLE XVII
INDEMNIFICATION
SECTION 17.1 GENERAL INDEMNITY OF THE BORROWER. Without limiting
any other rights which any such Person may have hereunder or under
applicable law, the Borrower hereby agrees to indemnify each of the
Agent, the Investors, the Collateral Agent, the Custodian (if other than
AFL), the Backup Servicer and each other Affected Person and each of
their Affiliates, and each of their respective successors, transferees,
participants and assigns and all officers, directors, shareholders,
controlling persons, employees and agents of any of the foregoing (each
of the foregoing Persons being individually called an "INDEMNIFIED
PARTY"), forthwith on demand, from and against any and all damages,
losses, claims, liabilities and related costs and expenses, including
reasonable attorneys' fees and disbursements (all of the foregoing being
collectively called "INDEMNIFIED AMOUNTS") awarded against or incurred by
any of them arising out of or relating to any Transaction Document or the
transactions contemplated thereby or the use of proceeds therefrom by the
Borrower, including (without limitation) in respect of the funding of any
Advance or in respect of any Transferred Receivable, EXCLUDING, HOWEVER,
(a) Indemnified Amounts to the extent determined by a court of competent
jurisdiction to have resulted from gross negligence or willful
misconduct on the part of such Indemnified Party or its agent or
subcontractor, (b) except as otherwise provided therein, non-payment by
any Obligor of an amount due and payable with respect to a Transferred
Receivable, (c) any loss in value of any Financed Vehicle or Permitted
Investment due to changes in market conditions or for other reasons
beyond the control of the Borrower or (d) any tax upon or measured by net
income on any Indemnified Party. Without limiting the foregoing, but
subject to the exclusions (a) through (d) above, the Borrower agrees to
indemnify each Indemnified Party for Indemnified Amounts arising out of
or relating to:
(i) the breach of any representation or warranty made by
the Borrower (or any of its officers) under or in connection with this Agreement
or the other Transaction Documents,
any Servicer's Certificate, Borrowing Base Confirmation or any other
information, report or certificate delivered by the Borrower or Servicer
pursuant hereto or thereto, which shall have been false or incorrect in any
material respect when made or deemed made;
(ii) the failure by the Borrower to comply in any
material way with any applicable law, rule or regulation with respect to any
Transferred Receivable or any Financed Vehicle, or the nonconformity of any
Transferred Receivable with any such applicable law, rule or regulation;
(iii) the failure to vest and maintain vested in the
Collateral Agent, for the benefit of the Secured Parties, a first-priority
security interest in all the Collateral, free and clear of any Lien, other than
a Lien arising solely as a result of an act of any Investor, or any assignee of
any Investor;
(iv) any dispute, claim, offset or defense (other than
discharge in bankruptcy) of an Obligor to the payment of any Transferred
Receivable (including, without limitation, a defense based on such Transferred
Receivable not being a legal, valid and binding obligation of such Obligor
enforceable against it in accordance with its terms);
(v) any failure of AFL or an Affiliate of the Borrower,
as Servicer, to perform its duties or obligations in accordance with the
provisions of ARTICLE VIII or any provision contained in any Transaction
Document;
(vi) any claim involving products liability that arises
out of or relates to merchandise or services that are the subject of any
Transferred Receivable or strict liability claim in connection with any Financed
Vehicle related to a Transferred Receivable;
(vii) any tax or governmental fee or charge (but not
including taxes upon or measured by net income), all interest and penalties
thereon or with respect thereto, and all out-of-pocket costs and expenses,
including the reasonable fees and expenses of counsel in defending against the
same, which may arise by reason of the making, maintenance or funding, directly
or indirectly, of any Advance, or any other interest in the Borrower Collateral;
(viii) the offering or effectuation of any Take-Out
Securitization; or
(ix) the commingling of the proceeds of the Borrower
Collateral at any time with other funds.
SECTION 17.2 [Intentionally left blank]
SECTION 17.3 CONTRIBUTION. If for any reason (other than the
exclusions (a) through (d) set forth in the first paragraph of
SECTION 17.1) the indemnification provided above in SECTION 17.1 is
unavailable to an Indemnified Party or is insufficient to hold an
Indemnified Party harmless, then the Borrower shall contribute to the
amount paid or payable by such Indemnified Party as a result of such
loss, claim, damage or liability in such proportion as is appropriate to
reflect not only the relative benefits received by such Indemnified
Party, on the
one hand, and the Borrower, on the other hand, but also the relative
fault of such Indemnified Party, on the one hand, and the Borrower, on
the other hand, as well as any other relevant equitable considerations.
ARTICLE XVIII
MISCELLANEOUS
SECTION 18.1 NO WAIVER; REMEDIES. No failure on the part of any
Investor, the Agent, any Indemnified Party or any Affected Person to
exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise by any of them of any right, power or remedy hereunder
preclude any other or further exercise thereof, or the exercise of any
other right, power or remedy. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law. Without
limiting the foregoing, each Investor and Participant is hereby
authorized by the Borrower at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by it to or for
the credit or the account of the Borrower, now or hereafter existing
under this Agreement, to the Agent, any Affected Person, any Indemnified
Party or any Investor or their respective successors and assigns.
SECTION 18.2 AMENDMENTS, WAIVERS. This Agreement may not be
amended, supplemented or modified nor may any provision hereof be waived
except in accordance with the provisions of this SECTION 18.2. With the
written consent of the Required Lenders, the Agent, the Borrower, the
Servicer and the Backup Servicer may, from time to time, enter into
written amendments, supplements, waivers or modifications hereto for the
purpose of adding any provisions to this Agreement or changing in any
manner the rights of any party hereto or waiving, on such terms and
conditions as may be specified in such instrument, any of the
requirements of this Agreement; PROVIDED, HOWEVER, that no such
amendment, supplement, waiver or modification shall (i) reduce the amount
of or extend the maturity of any payment with respect to an Advance or
reduce the rate or extend the time of payment of Yield thereon, or reduce
or alter the timing of any other amount payable to any Lender hereunder,
in each case without the consent of each Purchaser affected thereby;
(ii) amend, modify or waive any provision of this Section 18.2 OR 18.12,
or reduce the percentage specified in the definition of Required Lenders,
in each case without the written consent of all Lenders or (iii) amend,
modify or waive any provision of ARTICLE XV of this Agreement without the
written consent of the Agent and the Required Lenders. Any waiver of any
provision of this Agreement shall be limited to the provisions
specifically set forth therein for the period of time set forth therein
and shall not be construed to be a waiver of any other provision of this
Agreement.
SECTION 18.3 NOTICES, ETC. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in
writing (including facsimile communication) and shall be personally
delivered or sent by certified mail, postage prepaid, or by facsimile, to
the intended party at the address or facsimile number of such party set
forth under its name on the signature pages hereof or at such other
address or facsimile
number as shall be designated by such party in a written notice to the
other parties hereto. All such notices and communications shall be
effective, (a) if personally delivered, when received, (b) if sent by
certified mail, three Business Days after having been deposited in the
mail, postage prepaid, (c) if sent by overnight courier, one Business Day
after having been given to such courier, and (d) if transmitted by
facsimile, when sent, receipt confirmed by telephone or electronic means,
except that notices and communications pursuant to SECTION 2.2 shall not
be effective until received.
SECTION 18.4 COSTS, EXPENSES AND TAXES.
(a) In addition to the rights of indemnification granted under
SECTION 17.1, the Borrower agrees to pay on demand all reasonable costs
and expenses of the Agent in connection with the preparation (subject to
the Fee Letter), execution, delivery, syndication and administration of
this Agreement, the Noncommitted Lender Liquidity Arrangement or other
liquidity support facility and the other documents and agreements to be
delivered hereunder or with respect hereto, and any amendments, waivers
or consents executed in connection with this Agreement and the
Noncommitted Lender Liquidity Arrangement or other liquidity support
facility, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Agent with respect thereto and
with respect to advising the Agent as to its rights and remedies under
this Agreement and the Noncommitted Lender Liquidity Arrangement or other
liquidity support facility, and to pay all costs and expenses, if any
(including reasonable counsel fees and expenses), of the Agent, the
Lenders, the Collateral Agent, the Investors and their respective
Affiliates, in connection with the enforcement of this Agreement, any of
the other Transaction Documents and/or the Noncommitted Lender Liquidity
Arrangement or other liquidity support facility and the other documents
and agreements to be delivered hereunder or with respect hereto.
(b) In addition, the Borrower shall pay any and all stamp and
other taxes and fees payable in connection with the execution, delivery,
filing and recording of this Agreement, the Note or the other documents
or agreements to be delivered hereunder, and agrees to save each
Indemnified Party harmless from and against any liabilities with respect
to or resulting from any delay in paying or omission to pay such taxes
and fees.
SECTION 18.5 BINDING EFFECT; SURVIVAL. This Agreement shall be
binding upon and inure to the benefit of the Borrower, the Servicer, the
Backup Servicer, the Collateral Agent, the Investors, the Agent and their
respective successors and assigns, and the provisions of SECTION 5.1(b),
ARTICLE VI, SECTION 12.1, and ARTICLE XVII shall inure to the benefit of
the Affected Persons and the Indemnified Parties, as the case may be, and
their respective successors and assigns; PROVIDED, HOWEVER, nothing in
the foregoing shall be deemed to authorize any assignment not permitted
by ARTICLE XVI. This Agreement shall create and constitute the
continuing obligations of the parties hereto in accordance with its
terms, and shall remain in full force and effect until such time, after
the Commitment Termination Date when all Obligations have been finally
and fully paid and performed. The rights and remedies with respect to
any breach of any representation and warranty made by the Borrower
pursuant to ARTICLE IX and the indemnification and payment provisions of
ARTICLE VI, SECTION 12.1, and ARTICLE XVII and the provisions of SECTION
18.11 and SECTION 18.12
shall be continuing and shall survive any termination of this Agreement
and any termination of AFL's rights to act as Servicer hereunder or under
any other Transaction Document.
SECTION 18.6 CAPTIONS AND CROSS REFERENCES. The various captions
(including, without limitation, the table of contents) in this Agreement
are provided solely for convenience of reference and shall not affect the
meaning or interpretation of any provision of this Agreement. Unless
otherwise indicated, references in this Agreement to any Section,
Schedule or Exhibit are to such Section of or Schedule or Exhibit to this
Agreement, as the case may be, and references in any Section, subsection,
or clause to any subsection, clause or subclause are to such subsection,
clause or subclause of such Section, subsection or clause.
SECTION 18.7 SEVERABILITY. Any provision of this Agreement which
is 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 of this
Agreement or affecting the validity or enforceability of such provision
in any other jurisdiction.
SECTION 18.8 GOVERNING LAW. THIS AGREEMENT AND THE NOTE SHALL BE
A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK WITHOUT REGARD TO ANY OTHERWISE APPLICABLE CONFLICT OF LAW
PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW).
SECTION 18.9 COUNTERPARTS. This Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to
be an original but all of which shall constitute together but one and the
same agreement.
SECTION 18.10 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
AND EACH INVESTOR BY ITS ACCEPTANCE OF ANY INTEREST IN ANY NOTE OR
ADVANCE OR IN A LENDER'S OBLIGATION TO MAKE ADVANCES HEREUNDER HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT
OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER TRANSACTION
DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE BORROWER, AFL, THE
SERVICER, THE AGENT, THE BACKUP SERVICER, THE COLLATERAL AGENT, THE
INVESTORS OR ANY OTHER AFFECTED PERSON. THE BORROWER ACKNOWLEDGES AND
AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS
PROVISION (AND EACH OTHER PROVISION OF EACH OTHER TRANSACTION DOCUMENT TO
WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR
THE AGENT AND THE LENDERS ENTERING INTO THIS AGREEMENT AND EACH SUCH
OTHER TRANSACTION DOCUMENT.
SECTION 18.11 CONFLICT WAIVER. CSFB acts as Agent hereunder, as
administrative
agent for the Noncommitted Lender, and as provider and as agent for other
providers of backup facilities for the Noncommitted Lender, and may
provide other services or facilities from time to time (the "CSFB
ROLES"). Each of the parties hereto hereby acknowledges and consents to
any and all CSFB Roles, waives any objections it may have to any actual
or potential conflict of interest caused by CSFB's acting or maintaining
any of the CSFB Roles, and agrees that in connection with any CSFB Role,
CSFB may take, or refrain from taking, any action consistent with its
obligations under the Transaction Documents.
SECTION 18.12 NO PROCEEDINGS.
(a) Each of the Borrower, AFL, the Servicer, the Backup
Servicer, the Collateral Agent, and each Investor (other than the
Noncommitted Lender) hereby agrees that it will not institute against the
Noncommitted Lender, or join any other Person in instituting against the
Noncommitted Lender, any insolvency proceeding (namely, any proceeding of
the type referred to in the definition of Event of Bankruptcy) so long as
any commercial paper or other senior indebtedness issued by the
Noncommitted Lender shall be outstanding or there shall not have elapsed
one year PLUS one day since the last day on which any such commercial
paper or other senior indebtedness shall be outstanding. The foregoing
shall not limit such Person's right to file any claim in or otherwise
take any action with respect to any insolvency proceeding that was
instituted by any Person other than such Person.
(b) Each of CSFB, AFL, the Servicer, the Backup Servicer, the
Collateral Agent, each Investor and the Agent hereby agrees that it will
not institute against the Borrower, or join any other Person in
instituting against the Borrower, any insolvency proceeding (namely, any
proceeding of the type referred to in the definition of Event of
Bankruptcy) so long as any Advances or other amounts due from the
Borrower hereunder shall be outstanding or there shall not have elapsed
one year PLUS one day since the last day on which any such Advances or
other amounts shall be outstanding. The foregoing shall not limit such
Person's right to file any claim in or otherwise take any action with
respect to any insolvency proceeding that was instituted by any Person
other than such Person.
SECTION 18.13 LIMITED RECOURSE TO THE LENDERS. No recourse under
any obligation, covenant or agreement of a Lender contained in this
Agreement shall be had against any incorporator, stockholder, officer,
director, member, manager, employee or agent of any Lender or any of its
Affiliates (solely by virtue of such capacity) by the enforcement of any
assessment or by any legal or equitable proceeding, by virtue of any
statute or otherwise; it being expressly agreed and understood that this
Agreement is solely a corporate obligation of each Lender, and that no
personal liability whatever shall attach to or be incurred by any
incorporator, stockholder, officer, director, member, manager, employee
or agent of any Lender or any of their Affiliates (solely by virtue of
such capacity) or any of them under or by reason of any of the
obligations, covenants or agreements of a Lender contained in this
Agreement, or implied therefrom, and that any and all personal liability
for breaches by a Lender of any of such obligations, covenants or
agreements, either at common law or at equity, or by statute, rule or
regulation, of every such incorporator, stockholder, officer, director,
member, manager, employee or agent is hereby expressly waived as a
condition of and in consideration for the execution of this Agreement;
PROVIDED that the
foregoing shall not relieve any such Person from any liability it might
otherwise have as a result of their willful misconduct, gross negligence
or of fraudulent actions taken or fraudulent omissions made by them.
SECTION 18.14 COLLATERAL AGENT. Each Lender and each Investor by
its acceptance of any interest in any Note or Advance or in a Lender's
obligation to make Advances hereunder and the Agent designate and appoint
Norwest to act as Collateral Agent hereunder and under the Collateral
Agent Agreement. Norwest, by its execution hereof, accepts and agrees to
such designation and appointment and agrees to perform its obligations
under the Collateral Agent Agreement in accordance with the terms thereof
and for the benefit of the Agent, the Lenders and other Secured Parties.
In furtherance of the foregoing, each Lender authorizes the Agent to
enter into the Collateral Agent Agreement and to appoint the Collateral
Agent to act on behalf of, and as agent for, such Lender and the Agent
under the Collateral Agent Agreement and agrees to be bound by Section 9
of such agreement.
SECTION 18.15 CUSTODIAN. AFL accepts and agrees to its
designation and appointment as Custodian under the Custodial Agreement
and agrees to perform its obligations under such agreement in accordance
with the terms thereof and for the benefit of the Borrower and the
Secured Parties.
SECTION 18.16 ENTIRE AGREEMENT. THIS AGREEMENT AND THE OTHER
TRANSACTION DOCUMENTS EXECUTED AND DELIVERED HEREWITH REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES HERETO AND THERETO AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG
THE PARTIES.
[signature pages begin on next page]
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their respective officers thereunto duly authorized as of the day and year
first above written.
ARCADIA RECEIVABLES FINANCE CORP. IV
By:
Name:
Title:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Treasurer
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
ARCADIA FINANCIAL LTD., individually and
as Servicer and Custodian
By:
Name:
Title:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Treasurer
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
CREDIT SUISSE FIRST BOSTON, NEW
YORK BRANCH, as Agent
By:
Name:
Title:
By:
Name:
Title:
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Asset Finance Department
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as Backup
Servicer and Collateral Agent
By:
Name:
Title:
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Services - Asset
Backed Administration
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
THE BANKS COMMITMENT: $150,000,000
CREDIT SUISSE FIRST BOSTON, NEW
YORK BRANCH, as a Bank
By:
Name:
Title:
By:
Name:
Title:
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Asset Finance Department
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
EXHIBIT A
[FORM OF ADVANCE REQUEST]
Credit Suisse First Boston, Norwest Bank Minnesota, National
New York Branch, as Agent Association
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ Sixth Street & Marquette Avenue
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇/▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Fax #: (▇▇▇) ▇▇▇-▇▇▇▇ Fax #: (▇▇▇) ▇▇▇-▇▇▇▇
Phone #: (212) ▇▇▇- ▇▇▇▇/9084 Phone#: (612) 667-
RE: Advance Request: $__________
Gentlemen and Ladies:
This Advance Request is delivered to you pursuant to SECTION 2.2 of the
Receivables Financing Agreement, dated as of September 24, 1998 (together with
all amendments, if any, from time to time made thereto, the "RECEIVABLES
FINANCING AGREEMENT"), among Arcadia Receivables Finance Corp. IV (the
"Borrower"), Arcadia Financial Ltd., Norwest Bank Minnesota, National
Association, the Lenders parties thereto and Credit Suisse First Boston, New
York Branch (the "AGENT") . Unless otherwise defined herein or the context
otherwise requires, capitalized terms used herein have the meanings provided in
the Receivables Financing Agreement.
The Borrower hereby requests that on ________, 19__ an Advance be made in
the aggregate principal amount of $_________having a Fixed Period of days
(determined pursuant to SECTION 3.3(b) of the Receivables Financing Agreement).
The Schedule of Receivables setting forth the Eligible Receivables to be
purchased on the date of the requested Advance by the Borrower under the
Purchase Agreement is attached hereto as Annex I.
Please wire $____________ to the Reserve Account and $_________to the
Borrower pursuant to SECTION 2.3 of the Receivable Financing Agreement . After
giving effect to the requested Advance and the application of the proceeds
thereof, the amount on deposit in the Reserve Account on the Advance Date will
be $______________ which amount equals or exceeds the Minimum Reserve Account
Amount.
The Borrower hereby acknowledges that, pursuant to SECTION 2.4 of the
Receivables Financing Agreement, each of the delivery of this Advance Request
and the acceptance by the Borrower of the proceeds of the Advances requested
hereby constitutes a representation and warranty by the Borrower that, on the
date of such Advances, and before and after giving
effect thereto and to the application of the proceeds therefrom in accordance
with the Transaction Documents, all applicable statements set forth in
SECTION 2.4 are true and correct in all material respects.
The Borrower agrees that if prior to the time of the Advance requested
hereby any matter certified to herein by it will not be true and correct at such
time as if then made, it will immediately so notify the Agent. Except to the
extent, if any, that prior to the time of the Advance requested hereby the Agent
shall receive written notice to the contrary from the Borrower, each matter
certified to herein shall be deemed once again to be certified as true and
correct at the date of such Advance as if then made.
The Borrower has caused this Advance Request to be executed and delivered,
and the certification and warranties contained herein to be made, by its duly
authorized officer this day of , 19 .
ARCADIA RECEIVABLES FINANCE CORP. IV
By:
Name:
Title:
ATTACHMENT
EXHIBIT B
[FORM OF NOTE]
NOTE
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAW, AND MAY NOT BE
DIRECTLY OR INDIRECTLY OFFERED OR SOLD OR OTHERWISE DISPOSED OF BY THE OWNER
HEREOF UNLESS SUCH TRANSACTION IS EXEMPT FROM REGISTRATION UNDER THE ACT AND
SUCH STATE LAWS, AND WILL NOT BE A "PROHIBITED TRANSACTION" UNDER THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"). BY ACCEPTANCE OF
THIS NOTE, THE HOLDER AGREES TO BE BOUND BY ALL THE TERMS OF THE RECEIVABLES
FINANCING AGREEMENT.
$______________ _________ __, 1998
FOR VALUE RECEIVED, the undersigned, Arcadia Receivables Finance Corp. IV,
a Delaware corporation (the "BORROWER"), promises to pay to the order of Credit
Suisse First Boston, New York Branch, as Agent for the Lenders, on the Facility
Termination Date the principal sum of _________________________ _______
($___________) or, if less, the aggregate unpaid principal amount of all
Advances shown on the schedule attached hereto (and any continuation thereof)
and/or in the records of Agent made by the Lenders pursuant to that certain
Receivables Financing Agreement, dated as of September 24, 1998 (together with
all amendments and other modifications, if any, from time to time thereafter
made thereto, the "RECEIVABLES FINANCING AGREEMENT"), among the Borrower,
Arcadia Financial Ltd., Norwest Bank Minnesota, National Association, the
Lenders parties thereto and Credit Suisse First Boston, New York Branch, as
Agent. Unless otherwise defined, capitalized terms used herein have the
meanings provided in the Receivables Financing Agreement.
The Borrower also promises to pay Yield on the unpaid principal amount
hereof from time to time outstanding from the date hereof until maturity
(whether by acceleration or otherwise) and, after maturity, until paid, at the
rates per annum and on the dates specified in the Receivables Financing
Agreement.
Payments of both principal and Yield are to be made in lawful money of the
United States of America in immediately available funds to the account
designated by the Agent pursuant to the Receivables Financing Agreement.
This Note is the Note referred to in, and evidences indebtedness incurred
under, the Receivables Financing Agreement, and the holder hereof is entitled to
the benefits of the Receivables Financing Agreement, to which reference is made
for a description of the security for this Note and for a statement of the terms
and conditions on which the Borrower is permitted and required to make
prepayments and repayments of principal of the indebtedness evidenced by this
Note and on which such indebtedness may be declared to be immediately due and
payable.
All parties hereto, whether as makers, endorsers, or otherwise, severally
waive presentment for payment, demand, protest and notice of dishonor.
As provided in the Receivables Financing Agreement and subject to certain
limitations therein set forth, the transfer of this Note is registrable in the
Note Register, upon surrender of this Note for registration of transfer at the
office or agency of the Agent in The City of New York, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Note Registrar duly executed by, the holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Notes, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Notes are issuable only in registered form without coupons in minimum
denominations of $100,000. As provided in the Agreement and subject to certain
limitations therein set forth, Notes are exchangeable for a like aggregate
principal amount of Notes of a different authorized denomination, as requested
by the holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Borrower may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Borrower, and any agent of the Borrower, the Collateral Agent and the
Agent may treat the Person in whose name this Note is registered as the owner
hereof for all purposes, whether or not this Note may be overdue, and shall be
affected by notice to the contrary.
The holder hereof hereby agrees, and any assignee of such holder, by
accepting such assignment, shall be deemed to have agreed, that it will not
institute against the Noncommitted Lender or the Borrower, or join any other
Person in instituting against the Noncommitted Lender or the Borrower, any
insolvency proceeding (namely, any proceeding of the type referred to in the
definition of Event of Bankruptcy) so long as, in the case of the Noncommitted
Lender, any commercial paper or other senior indebtedness issued by the
Noncommitted Lender shall be outstanding or there shall not have elapsed one
year PLUS one day since the last day on which any such commercial paper or other
senior indebtedness shall be outstanding and, in the case of the Borrower, any
Advances or other amounts due from the Borrower hereunder shall be outstanding
or there shall not have elapsed one year PLUS one day since the last day on
which any such Advances or other amounts shall be outstanding. The foregoing
shall not limit such Person's right to file any claim in or otherwise take any
action with respect to any insolvency proceeding that was instituted by any
Person other than such Person. The agreement set forth in this paragraph shall
survive payment of this Note.
THIS NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE
INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY OTHERWISE
APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS.
ARCADIA RECEIVABLES FINANCE CORP. IV
By:
Name:
Title:
Personally appeared before me ________________________ [name of notary],
in _____________________[county], ____________________ [state], the above-named
_______________________ [name of person executing], known or proved to me to be
the same person who executed the foregoing instrument and to be the
_______________________ [title] of ARCADIA RECEIVABLES FINANCE CORP. IV and
acknowledged to me that he executed the same as his free act and deed and the
free act and deed of [ ].
Subscribed and sworn before me this ____ day of _________, 199_.
NOTARY PUBLIC
COUNTY OF __________________
STATE OF ___________________
My commission expires the ____ day of
____________, ____.
FORM OF ASSIGNMENT FORM
ASSIGNMENT FORM
If you the holder want to assign this Note, fill in the form below and have
your signature guaranteed:
I or we assign and transfer this Note to:
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint , agent to transfer this Note
on the books of the Borrower. The agent may substitute another to act for him.
Dated: Signed:
(sign exactly as the name appears on the other side of this Note)
Signature Guarantee
Important Notice: When you sign your name to this Assignment Form without
filling in the name of your "Assignee" or "Attorney", this Note becomes fully
negotiable, similar to a check endorsed in blank. Therefore, to safeguard a
signed Note, it is recommended that you fill in the name of the new owner in the
"Assignee" blank. Alternatively, instead of using this Assignment Form, you may
sign a separate "power of attorney" form and then mail the unsigned Note and the
signed "power of attorney" in separate envelopes. For added protection, use
certified or registered mail for a Note.
Schedule attached to Note
dated ___________, 199_
of [ ] payable to
the order of Credit Suisse
First Boston, New York
Branch, as Agent
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DATE OF AMOUNT OF AMOUNT OF
ADVANCE ADVANCE REPAYMENT
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EXHIBIT C
[FORM OF INTEREST RATE HEDGE ASSIGNMENT ACKNOWLEDGMENT]
[Date]
[Name of Hedge Counterparty]
[Address of Hedge Counterparty]
Attention:_________________
ISDA Master Agreement and Schedule, dated as of ___________, 19__ (as
amended, the "Hedge Agreement"), among [Name of Hedge Counterparty] (the
"Counterparty") and Arcadia Receivables Finance Corp. IV ("Company")
Ladies and Gentlemen:
Company hereby notifies you that Company has assigned to Norwest
Bank Minnesota, National Association, as Collateral Agent, under the
Receivables Financing Agreement identified below, all of its right, title
and interest in and to any interest rate hedge (each, a "Hedge") entered
into pursuant to the Hedge Agreement, including, without limitation, (i)
all rights of Company to receive moneys due and to become due under or
pursuant to the ▇▇▇▇▇▇, (ii) claims of Company for damages arising out of
or for breach of or default under the ▇▇▇▇▇▇, (iii) the right of Company to
terminate the ▇▇▇▇▇▇ or the Hedge Agreement, and to compel performance and
otherwise exercise all remedies thereunder, and (iv) all proceeds of any
and all of the foregoing (the assignment of all right, title and interest
of Company in and to the ▇▇▇▇▇▇ and the Hedge Agreement being referred to
as the "Assigned Rights").
As used herein, "Receivables Financing Agreement" shall mean that
certain Receivables Financing Agreement, dated as of SEPTEMBER 24, 1998,
by and among Arcadia Financial Ltd., individually and as Servicer and
Custodian, the Lenders parties thereto, Credit Suisse First Boston,
New York Branch, as Agent (the "Agent"), and Norwest Bank Minnesota,
National Association ("Norwest), as Backup Servicer and Collateral Agent,
as the same may from time to time be amended, supplemented or otherwise
modified and in effect.
The Counterparty hereby agrees that, until the Counterparty
receives written notice from the Agent to the contrary, the Counterparty
shall make all payments under the Hedge Agreement and the ▇▇▇▇▇▇ to
Norwest, as Collateral Agent, as follows: [INSERT WIRE INSTRUCTIONS].
Upon the Counterparty's receipt of written notice from the Agent, (i) the
Counterparty will cease to make any such payments to Norwest, and shall
make all such payments only to the Agent or as the Agent may from time to
time direct, and (ii) the Agent shall be entitled to exercise any and all
rights and remedies of Company under the Hedge
Agreement and the ▇▇▇▇▇▇ to receive such payments in accordance with the
terms hereof.
All payments to be made under the Hedge Agreement and the ▇▇▇▇▇▇
by the Counterparty shall be made by the Counterparty irrespective of, and
without deduction for, any counterclaim, defense, recoupment or set-off
(other than netting for payments owing by Company thereunder in accordance
with the terms of the Hedge Agreement and the ▇▇▇▇▇▇) and shall be final,
and the Counterparty will not seek to recover from the Agent or any
Purchaser for any reason any such payment once made.
Notwithstanding the foregoing, (a) Company shall remain liable
under the Hedge Agreement and each Hedge to perform all of its duties and
obligations thereunder to the same extent as if this Acknowledgment had not
been executed, (b) the exercise by the Agent of any of the rights hereunder
shall not release Company from any of its duties or obligations under the
Hedge Agreement or any Hedge, and (c) neither the Agent nor any Investor
shall have any obligation or liability under the Hedge Agreement or any
Hedge by reason of this Acknowledgment, nor shall any of them be obligated
to perform any of the obligations or duties of Company thereunder or to
take any action to collect or enforce any claim for payment thereunder.
Company shall not, without the prior written consent of the Agent
(i) sell, assign (by operation of law or otherwise) or otherwise dispose
of, or grant any option with respect to, any of the Assigned Rights, or
create or permit to exist any lien, security interest, option or other
charge or encumbrance upon or with respect to any of the Assigned Rights,
except for the assignment acknowledged hereby; (ii) cancel or terminate the
Hedge Agreement or any Hedge or consent to or accept any cancellation or
termination thereof; (iii) amend or otherwise modify the Hedge Agreement or
any Hedge or give any consent, waiver or approval thereunder; (iv) waive
any default under or breach of the Hedge Agreement or any Hedge; or (v)
take any other action in connection with the Hedge Agreement or any Hedge
which would impair the value of the interest or rights of Company
thereunder or which would impair the interests or rights of the Agent for
the benefit of the Lenders.
No amendment or waiver of any provision hereof, and no consent to
any departure by Company herefrom shall in any event be effective unless
the same shall be in writing and signed by the Agent, Company and the
Counterparty, and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
This letter agreement may be executed in counterparts, each of
which when executed by the parties hereto shall be deemed an original and
all of which together shall be deemed the same instrument.
This letter agreement shall be binding upon Company and the
Counterparty and their respective successors and assigns, and shall inure,
together with the rights and remedies of the Agent hereunder, to the
benefit of the Agent and Investors, and their respective successors,
transferees and assigns. This letter agreement shall be governed by and
construed in accordance with the laws (including Section 5-1401 of the
General
Obligations Laws of New York but otherwise without regard to conflicts of
law provisions) of the State of New York.
Very truly yours,
ARCADIA RECEIVABLES FINANCE CORP. IV
By
Name:
Title:
--------------------------------------------------------------------------------
Acknowledged and agreed:
[NAME OF HEDGE
COUNTERPARTY]
By
Name:
Title:
--------------------------------------------------------------------------------
CREDIT SUISSE FIRST BOSTON,
NEW YORK BRANCH, as Agent
By
Name:
Title:
By
Name:
Title:
EXHIBIT D
[FORM OF BORROWING BASE CONFIRMATION]
EXHIBIT E
[FORM OF SERVICER'S CERTIFICATE]
EXHIBIT F
JOINDER SUPPLEMENT
JOINDER SUPPLEMENT, dated as of the date set forth in Item 1 of Schedule I
hereto, among Arcadia Financial Ltd., individually and as Servicer ("AFL"),
Arcadia Receivables Finance Corp. IV (the "BORROWER"), the Structured Lender set
forth in Item 2 of Schedule I hereto (the "NONCOMMITTED LENDER"), and Credit
Suisse First Boston, New York Branch, as Agent for the Lenders under, and as
defined in, the Agreement described below (in such capacity, the "AGENT").
W I T N E S S E T H:
WHEREAS, this Supplement is being executed and delivered under the
Receivables Financing Agreement, dated as of September 24, 1998, among AFL, the
Borrower, the Lenders, Norwest Bank Minnesota, National Association ("NORWEST"),
and the Agent (as from time to time amended, supplemented or otherwise modified
in accordance with the terms thereof, the "AGREEMENT"; unless otherwise defined
herein, terms defined in the Agreement are used herein as therein defined); and
WHEREAS, the party set forth in Item 2 of Schedule I hereto wishes to
become the Noncommitted Lender party to the Agreement;
NOW, THEREFORE, the parties hereto hereby agree as follows:
(a) Upon receipt by the Agent of five counterparts of this Supplement, to
each of which is attached a fully completed Schedule I and Schedule II, each of
which has been executed by the Noncommitted Lender, the Agent, AFL and the
Borrower, the Agent will transmit to AFL, the Borrower, Norwest and the
Noncommitted Lender a Joinder Effective Notice, substantially in the form of
Schedule III to this Supplement (a "JOINDER EFFECTIVE NOTICE"). Such Joinder
Effective Notice shall be executed by the Agent and shall set forth, INTER ALIA,
the date on which the joinder effected by this Supplement shall become effective
(the "JOINDER EFFECTIVE DATE"). From and after the Joinder Effective Date, the
party set forth in Item 2 of Schedule I hereto shall be the Noncommitted Lender
and a Lender party to the Agreement for all purposes thereof.
(b) Each of the parties to this Supplement agrees and acknowledges that at
any time and from time to time upon the written request of any other party, it
will execute and
deliver such further documents and do such further acts and things as such other
party may reasonably request in order to effect the purposes of this Supplement.
(c) By executing and delivering this Supplement, the Noncommitted Lender
confirms to and agrees with the Agent and the Lenders as follows: (i) neither
the Agent nor any Lender makes any representation or warranty or assumes any
responsibility with respect to any statements, warranties or representations
made in or in connection with the Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Agreement or
any other instrument or document furnished pursuant thereto, or with respect to
the Receivables or the financial condition of AFL or the Borrower, or the
performance or observance by AFL or the Borrower of any of their respective
obligations under the Agreement or any other instrument or document furnished
pursuant hereto; (ii) the Noncommitted Lender confirms that it has received a
copy of such documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Supplement; (iii) the
Noncommitted Lender will, independently and without reliance upon the Agent or
any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Agreement; (iv) the Noncommitted Lender appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under the Agreement as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto, all in
accordance with Article XV of the Agreement; and (vi) the Noncommitted Lender
agrees (for the benefit of the parties hereto, the Lenders and Norwest) that it
will perform in accordance with their terms all of the obligations which by the
terms of the Agreement are required to be performed by it as a Lender which is a
Noncommitted Lender.
(d) Schedule II hereto sets forth administrative information with respect
to the Noncommitted Lender.
(e) This Supplement shall be governed by, and construed in accordance
with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to be
executed by their respective duly authorized officers on Schedule I hereto as of
the date set forth in Item 1 of Schedule I hereto.
SCHEDULE I TO
JOINDER SUPPLEMENT
COMPLETION OF INFORMATION AND
SIGNATURES FOR JOINDER SUPPLEMENT
Receivables Financing Agreement, dated as of September 24, 1998, with
Arcadia Financial Ltd., the other parties thereto and Credit Suisse First
Boston, New York Branch, as Agent.
Item 1: Date of Joinder Supplement: ______________
Item 2: Noncommitted Purchaser: _________________________________
Item 3: Signatures of Parties to Agreement:
___________________________, as Noncommitted Lender
By: ____________________________________, as
Attorney-in-Fact
By:_____________________________________
Name:
Title:
By:_____________________________________
Name:
Title:
ARCADIA FINANCIAL LTD., individually and as Servicer
By:_____________________________________
Name:
Title:
ARCADIA RECEIVABLES FINANCE CORP. IV
By:_________________________________
Name:
Title:
CREDIT SUISSE FIRST BOSTON, NEW YORK
BRANCH, as Agent
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
SCHEDULE II TO
JOINDER SUPPLEMENT
LIST OF INVESTING OFFICES, ADDRESS
FOR NOTICES AND WIRE INSTRUCTIONS
ADDRESS FOR NOTICES: ________________________
________________________
________________________
INVESTING OFFICE: ________________________
WIRE INSTRUCTIONS: ________________________
SCHEDULE III TO
JOINDER SUPPLEMENT
FORM OF
JOINDER EFFECTIVE NOTICE
[Name and address of AFL, the Borrower, Norwest
and Noncommitted Lender]
The undersigned, as Agent under the Receivables Financing Agreement,
dated as of September 24, 1998, with Arcadia Financial Ltd., the other
parties thereto and Credit Suisse First Boston, New York Branch, as Agent for
the Lenders thereunder, acknowledges receipt of five executed counterparts of
a completed Joinder Supplement. [Note: attach copies of Schedules I and II
from such Agreement.] Terms defined in such Supplement are used herein as
therein defined.
Pursuant to such Supplement, you are advised that the Joinder
Effective Date for [Name of Noncommitted Lender] will be _____________.
Very truly yours,
CREDIT SUISSE FIRST BOSTON,
NEW YORK BRANCH, as Agent
By:_______________________
Name:
Title:
By:_______________________
Name:
Title:
TABLE OF CONTENTS
Page
----
RECEIVABLES FINANCING AGREEMENT 1
BACKGROUND 1
ARTICLE I DEFINITIONS
SECTION 1.1 DEFINED TERMS 1
SECTION 1.2 OTHER DEFINITIONAL PROVISIONS 29
ARTICLE II THE FACILITY, ADVANCE PROCEDURES AND NOTE
SECTION 2.1 FACILITY 30
SECTION 2.2 ADVANCE PROCEDURES 30
SECTION 2.3 FUNDING 30
SECTION 2.4 REPRESENTATION AND WARRANTY 31
SECTION 2.5 [Intentionally left blank] 31
SECTION 2.6 [Intentionally left blank] 31
SECTION 2.7 VOLUNTARY TERMINATION OF FACILITY; REDUCTION OF
FACILITY 31
SECTION 2.8 NOTE 31
ARTICLE III YIELD, FEES, ETC.
SECTION 3.1 YIELD 32
SECTION 3.2 YIELD PAYMENT DATES 32
SECTION 3.3 YIELD ALLOCATIONS; SELECTION OF FIXED PERIODS, ETC. 32
SECTION 3.4 FEES 33
SECTION 3.5 COMPUTATION OF YIELD AND FEES 33
ARTICLE IV REPAYMENTS AND PREPAYMENTS
SECTION 4.1 REPAYMENTS AND PREPAYMENTS 33
ARTICLE V PAYMENTS; TAXES
SECTION 5.1 MAKING OF PAYMENTS; TAXES 34
SECTION 5.2 APPLICATION OF CERTAIN PAYMENTS 35
SECTION 5.3 DUE DATE EXTENSION 35
ARTICLE VI INCREASED COSTS, ETC.
SECTION 6.1 INCREASED COSTS 36
SECTION 6.2 ADDITIONAL YIELD ON ADVANCES BEARING A EURODOLLAR RATE 37
SECTION 6.3 FUNDING LOSSES 37
SECTION 6.4 REPLACEMENT OF AFFECTED PERSON 37
ARTICLE VII EFFECTIVENESS; CONDITIONS TO ADVANCES
SECTION 7.1 EFFECTIVENESS 38
SECTION 7.2 ALL ADVANCES 39
ARTICLE VIII ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 8.1 DUTIES OF THE SERVICER 41
SECTION 8.2 COLLECTION OF RECEIVABLE PAYMENTS; MODIFICATION AND
AMENDMENT OF RECEIVABLES; LOCKBOX AGREEMENTS 42
SECTION 8.3 REALIZATION UPON RECEIVABLES 44
SECTION 8.4 INSURANCE 45
SECTION 8.5 MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES 46
SECTION 8.6 COVENANTS, REPRESENTATIONS AND WARRANTIES OF SERVICER 47
SECTION 8.7 PURCHASE OF RECEIVABLES UPON BREACH OF COVENANT OR
REPRESENTATION AND WARRANTY 50
SECTION 8.8 TOTAL SERVICING FEE; PAYMENT OF CERTAIN EXPENSES BY
SERVICER 51
SECTION 8.9 SERVICER'S CERTIFICATE 51
SECTION 8.10 ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF SERVICER
TERMINATION EVENT 52
SECTION 8.11 ANNUAL INDEPENDENT ACCOUNTANTS' REPORT 52
SECTION 8.12 ACCESS TO CERTAIN DOCUMENTATION; WEEKLY REVIEW 53
SECTION 8.13 MONTHLY TAPE 53
SECTION 8.14 RETENTION OF SERVICER 54
SECTION 8.15 FIDELITY BOND 54
SECTION 8.16 INSURANCE 55
SECTION 8.17 ACCOUNTS 55
SECTION 8.18 COLLECTIONS 55
SECTION 8.19 APPLICATION OF COLLECTIONS 56
ARTICLE IX GRANT OF SECURITY INTERESTS
SECTION 9.1 BORROWER'S GRANT OF SECURITY INTEREST 56
SECTION 9.2 DELIVERY OF COLLATERAL 58
SECTION 9.3 BORROWER REMAINS LIABLE 58
SECTION 9.4 COVENANTS OF THE BORROWER AND SERVICER REGARDING THE
COLLATERAL 58
SECTION 9.5 RELEASE OF BORROWER COLLATERAL 61
ARTICLE X REPRESENTATIONS AND WARRANTIES OF THE BORROWER
SECTION 10.1 ORGANIZATION AND GOOD STANDING 62
SECTION 10.2 DUE QUALIFICATION 62
SECTION 10.3 POWER AND AUTHORITY 63
SECTION 10.4 SECURITY INTEREST; BINDING OBLIGATIONS 63
SECTION 10.5 NO VIOLATION 63
SECTION 10.6 NO PROCEEDINGS 63
SECTION 10.7 NO CONSENTS 64
SECTION 10.8 USE OF PROCEEDS 64
SECTION 10.9 CHIEF EXECUTIVE OFFICE 64
SECTION 10.10 SOLVENCY 64
SECTION 10.11 TAX TREATMENT 64
SECTION 10.12 COMPLIANCE WITH LAWS 64
SECTION 10.13 TAXES 64
SECTION 10.14 CERTIFICATES 65
SECTION 10.15 NO LIENS, ETC. 65
SECTION 10.16 PURCHASE AND SALE 65
SECTION 10.17 INVESTMENT COMPANY ACT OF 1940 65
SECTION 10.18 INFORMATION TRUE AND CORRECT 65
SECTION 10.19 ERISA COMPLIANCE 65
SECTION 10.20 FINANCIAL OR OTHER CONDITION 65
SECTION 10.21 INVESTMENT COMPANY STATUS 66
SECTION 10.22 NO TRADE NAMES 66
SECTION 10.23 SEPARATE CORPORATE EXISTENCE 66
SECTION 10.24 INVESTMENTS 66
SECTION 10.25 REPRESENTATION AND WARRANTIES TRUE AND CORRECT 66
SECTION 10.26 TRANSACTION DOCUMENTS 66
SECTION 10.27 OWNERSHIP OF THE BORROWER 67
SECTION 10.28 ELIGIBLE RECEIVABLES 67
ARTICLE XI COVENANTS OF THE BORROWER
SECTION 11.1 PROTECTION OF SECURITY INTEREST OF THE SECURED PARTIES 67
SECTION 11.2 REPORTING REQUIREMENTS 68
SECTION 11.3 PRESERVATION OF EXISTENCE 69
SECTION 11.4 KEEPING OF RECORDS AND BOOKS OF ACCOUNT 69
SECTION 11.5 SEPARATE CORPORATE EXISTENCE 69
SECTION 11.6 INTEREST RATE ▇▇▇▇▇▇ 70
SECTION 11.7 TANGIBLE NET WORTH 70
SECTION 11.8 TAKE-OUT SECURITIZATION 71
SECTION 11.9 SALES, LIENS, ETC., AGAINST RECEIVABLES AND RELATED
ASSETS 71
SECTION 11.10 STOCK, MERGER, CONSOLIDATION, ETC. 71
SECTION 11.11 CHANGE IN CORPORATE NAME 71
SECTION 11.12 INDEBTEDNESS 71
SECTION 11.13 GUARANTEES 71
SECTION 11.14 LIMITATION ON TRANSACTIONS WITH AFFILIATES 71
SECTION 11.15 DOCUMENTS 72
SECTION 11.16 CHARTER AND BY-LAWS 72
SECTION 11.17 ACCOUNTING TREATMENT 72
SECTION 11.18 LIMITATION ON INVESTMENTS 72
SECTION 11.19 DIVIDENDS 72
SECTION 11.20 OTHER LIENS OR INTERESTS 72
ARTICLE XII THE SERVICER
SECTION 12.1 LIABILITY OF SERVICER; INDEMNITIES 73
SECTION 12.2 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, THE SERVICER OR BACKUP SERVICER ▇▇
▇▇▇▇▇▇▇ ▇▇.▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇ LIABILITY OF SERVICER, BACKUP SERVICER AND
OTHERS 75
SECTION 12.4 DELEGATION OF DUTIES 76
SECTION 12.5 SERVICER AND BACKUP SERVICER NOT TO RESIGN 76
ARTICLE XIII SERVICER TERMINATION EVENTS
SECTION 13.1 SERVICER TERMINATION EVENT 77
SECTION 13.2 CONSEQUENCES OF A SERVICER TERMINATION EVENT 78
SECTION 13.3 APPOINTMENT OF SUCCESSOR SERVICER 79
ARTICLE XIV FACILITY TERMINATION EVENTS; THEIR EFFECT
SECTION 14.1 FACILITY TERMINATION EVENTS 80
SECTION 14.2 EFFECT OF FACILITY TERMINATION EVENT 83
SECTION 14.3 CERTAIN RIGHTS UPON FACILITY TERMINATION EVENT 83
ARTICLE XV THE AGENT
SECTION 15.1 APPOINTMENT 84
SECTION 15.2 DELEGATION OF DUTIES 84
SECTION 15.3 EXCULPATORY PROVISIONS 84
SECTION 15.4 RELIANCE BY AGENT 85
SECTION 15.5 ACTION UPON CERTAIN EVENTS; REPORTS AND NOTICES 85
SECTION 15.6 NON-RELIANCE ON AGENT 86
SECTION 15.7 INDEMNIFICATION 86
SECTION 15.8 SUCCESSOR AGENT 86
SECTION 15.9 LIABILITY OF THE AGENT 87
SECTION 15.10 AGENT AND AFFILIATES 87
ARTICLE XVI ASSIGNMENTS
SECTION 16.1 RESTRICTIONS ON ASSIGNMENTS 88
SECTION 16.2 DOCUMENTATION 88
SECTION 16.3 RIGHTS OF ASSIGNEE 88
SECTION 16.4 NOTICE OF ASSIGNMENT 88
SECTION 16.5 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE 88
SECTION 16.6 MUTILATED, DESTROYED, LOST AND STOLEN NOTES 90
SECTION 16.7 PERSONS DEEMED OWNERS 90
SECTION 16.8 CANCELLATION 90
SECTION 16.9 PARTICIPATIONS 91
ARTICLE XVII INDEMNIFICATION
SECTION 17.1 GENERAL INDEMNITY OF THE BORROWER 91
SECTION 17.2 [Intentionally left blank] 93
SECTION 17.3 CONTRIBUTION 93
ARTICLE XVIII MISCELLANEOUS
SECTION 18.1 NO WAIVER; REMEDIES 93
SECTION 18.2 AMENDMENTS, WAIVERS 93
SECTION 18.3 NOTICES, ETC. 94
SECTION 18.4 COSTS, EXPENSES AND TAXES 94
SECTION 18.5 BINDING EFFECT; SURVIVAL 95
SECTION 18.6 CAPTIONS AND CROSS REFERENCES 95
SECTION 18.7 SEVERABILITY 95
SECTION 18.8 GOVERNING LAW 95
SECTION 18.9 COUNTERPARTS 95
SECTION 18.10 WAIVER OF JURY TRIAL 95
SECTION 18.11 CONFLICT WAIVER 96
SECTION 18.12 NO PROCEEDINGS 96
SECTION 18.13 LIMITED RECOURSE TO THE LENDERS 97
SECTION 18.14 COLLATERAL AGENT 97
SECTION 18.15 CUSTODIAN 97
SECTION 18.16 ENTIRE AGREEMENT 97
__________
EXHIBITS:
EXHIBIT A Form of Advance Request (Section 2.2)
EXHIBIT B Form of Note (Section 2.8)
EXHIBIT C Form of Interest Rate Hedge Acknowledgment (Section 7.2)
EXHIBIT D Form of Borrowing Base Confirmation (Section 7.2)
EXHIBIT E Form of Servicer's Certificate (Section 8.9)
EXHIBIT F Form of Joinder Supplement (Section 7.1)