AGREEMENT
This AGREEMENT made this 1st day of December, 1992, by and between
Lawrence Federal Savings and Loan Association, having its principal office at
Ironton, Ohio, hereinafter called "Lender", and Lanco Services, Inc., a Kentucky
corporation having its principal office at 235 North Main Street, Versailles,
Kentucky, hereinafter sometimes called "LSI".
WITNESSETH: For and in consideration of the sum of One Dollar ($1.00)
paid by each party to the other and in further consideration of the mutual
covenants to be mutually kept and performed, it is agreed by and between Lender
and LSI:
1. Lender does hereby engage LSI to service Lender's mobile home dealer
accounts to be secured by LSI for the Lender, and LSI does hereby agree to
service said accounts for Lender.
2. LSI will perform various services necessary and useful to develop
and continue the relationship between the Lender and mobile home dealers
including, but not limited to, supplying dealers and instructing them in the
operation and use of the Lender's retail forms and procedures, furnishing
dealers with insurance information, rate charts, rate books, sales promotion
plans and other pertinent data.
3. LSI will attempt to secure dealers for the Lender, it being
expressly understood and agreed that LSI shall have no authority to commit the
Lender to accept any dealer, and the Lender shall have the right to refuse any
dealer secured by LSI. Furthermore, LSI will provide a constant dealer review
program in order to maintain a strong dealer organization.
4. LSI will accept and investigate retail applications from approved
dealers, the cost of such investigations to be borne by LSI and will only
approve applications and contracts which comply with the credit policies of
Lender.
5. The collateral on each contract will be covered with Physical Damage
and LSI Insurance coverage, which will be verified by LSI if not included in the
retail contract. All dealers will be urged to recommend Credit Life coverage in
connection with eligible contracts.
6. LSI will assist in the collection of delinquent retail accounts, and
will report to the Lender on the status of such accounts as well as on the
physical condition of the mobile homes covered by these accounts. It is agreed
that at the beginning of each month the Lender will notify the debtor and LSI of
any delinquencies existing at the end of the previous month; LSI will assist in
collecting the account and will also assist in the repossession of the mobile
home
when necessary.
7. Expenses incurred by LSI in assisting in the collection of referred
accounts will be borne solely by LSI.
8. LSI will arrange for the placing of the various retain insurance
coverage, including physical damage and credit life, with carriers acceptable to
the Lender.
9. Monthly inspection of new inventories will be made by LSI.
10. From the finance charge on retail contracts purchased by the
Lender, which contracts shall include a finance charge at rates to be agreed
upon between the Lender and the dealers from time to time, the Lender shall
retain an amount equal to that shown for Lender on Exhibit A, attached hereto
and made a part hereof, on new or used models or such other amounts as may be
agreed upon from time to time. The parties further expressly incorporate the
provisions of Exhibits B & C as part of the terms and conditions of this
agreement.
11. The permissible advance on all new mobile homes will be invoice,
10% of invoice sales tax, and invoice on any options such as: central air
conditioners, washers, dryers, skirting and awnings. The permissible advance on
used homes will be the market value taken from the Kelley Blue Book. There will
be a 10% down payment required on all new units and 20% on all used homes. The
down payment will be based on the actual selling price of the home.
12. In the event of prepayment of any retail contract prior to maturity
for any reason whatsoever, Lender shall charge to LSI Deferred Service Fee
account the unearned portion of the service fee. LSI Deferred Service Fee
account is hereby assigned to Lender as security for the payment of said
charges, and said account shall be subject only to debits to pay LSI's share of
such unearned charges. In the event of the termination of this agreement by
either party, LSI agrees to forfeit all funds remaining in the Deferred Service
Fee account until all such transactions have been liquidated, then all reserve
funds will revert to LSI.
13. LSI will maintain an office staffed with sufficient experienced
personnel to adequately service the mobile home business of Lender and will also
provide personnel for the purpose of relieving said Lender of outside manpower
requirements in connection with the mobile home finance program.
14. LSI will provide a financial statement to Lender as requested.
15.. It is expressly understood and agreed that Lender is to be in no
way responsible for
the acts of LSI in soliciting accounts, in making collections or in repossessing
mobile homes, and LSI shall have no authority to make representations as to
further extension of credit unless expressly authorized by Lender. LSI agrees to
present evidence of automobile public liability insurance in amounts and with
companies satisfactory to Lender, said insurance to cover LSI employees
performing acts required under this Agreement, and LSI agrees to maintain such
insurance.
16. It is the intention of the Lender and LSI that this Agreement shall
not be construed to create in any manner whatsoever an employer - employee
relationship, it being within the contemplation of the parties that all act
performed by LSI in carrying out the provisions of this Agreement shall be those
of an independent contractor.
17. This Agreement shall become effective immediately upon the
execution hereof by both parties and shall continue from the date of execution
to the date of cancellation, it being expressly understood and agreed that
either party may cancel said Agreement upon giving sixty (60) days prior written
notice to the other.
18. LSI agrees to hold the Lender harmless from any claims, losses, or
damages which it may suffer or which may be asserted against it arising from the
act of LSI or its employees and agents in connection with its services under the
Agreement.
19. The provisions hereof are severable. Should any provision,
paragraph, or portion of this Agreement be held invalid or unenforceable by any
court, such holding shall not invalidate or render unenforceable the remaining
provisions, paragraphs, and portions hereof.
IN WITNESS WHEREOF the parties hereto have executed this Agreement in Duplicate.
Accepted this 1st day of December, 1992.
Lawrence Federal Savings and Loan
/s/ Nina M. Fugitt By: /s/ [signature illegible], CEO
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/s/ Connie S. Cremeans By: /s/ Mary Kratzenberg
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Attest: Lanco Services, Inc.
/s/ Theresa Reece By: /s/ Tom Dean, Pres.
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By: /s/ C. Louise Taylor, Secretary-
Treasurer
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Exhibit A
[Company Logo]
DATE -------------------
CUSTOMER SELLING PRICE 1
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ADDRESS TAXES 2
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FEES 3
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DEALER OTHER 4
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ADDRESS LESS DOWN 5
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UNPAID BAL. 6
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PHYSICAL DAMAGE INS. 7
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Company Term
CR.LIFE/H.S.P., INS. 8
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Company Term
AMOUNT TO BE FINANCED 9
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NO. PAYMENTS @ A.P.R. TOTAL 10
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TOTAL FINANCE CHARGE (Line 10-9) 11
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LAW FED'S EARNINGS=AMT. FIN. @ APR 12
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LANCO'S EARNINGS=AMT. FIN. @ APR 13
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TOTAL EARNINGS LINES 12 +13 SHOULD EQUAL # 11 14
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FEDERAL REGULATIONS DISTRIBUTION
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FACTORY INVOICE FLR. PLAN OPTION 15
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+15% OF INVOICE DLR. CK. (6-2-3-15) 16
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+ SALES TAX SALES TAX (#2) 17
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+ DEALER OPTIONS LENDER FEE (#3) 18
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PERMISSIBLE ADV. INS. CK. (#7 & #8) 19
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90% OF # 1,2,3,7 LANCO CK.(60%#13) 20
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ACTUAL ADVANCE LANCO P.B. (40%#13) 21
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LTV RATIO LENDER EARN. (#12) 22
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TOTAL INCOME TOTAL (EQUAL #10) 23
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TOTAL DEBTS FLR. CK. TO:
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INC. - DEBT RATIO
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Loan Loss Agreement
EXHIBIT B
It is agreed that the incurrence of all losses on the Mobile Home Loan
Portfolio of Lawrence Federal Savings & Loan Association of Ironton will be
charged to the mobile home loan loss reserve that has been jointly funded by
Lawrence Federal Savings & Loan Association and Lanco Services, Inc. Lanco
forfeits all rights to said loss reserve which is solely for the incurrence of
any mobile home loan losses.
Reserve Account
EXHIBIT C
A reserve account will be opened and maintained at Lawrence Federal
Savings & Loan Association, Inc. by Lanco Services, Inc. based on the formula
calculated in EXHIBIT A for the following purposes: (1) to rebate to Lawrence
Federal any unamortized prepaid fees (straight-line) unearned by Lanco Services,
Inc. due to an early pay-off of a mobile home loan and (2) to replenish loan
loss reserve if deemed necessary by Lawrence Federal Savings. At no time shall
funds be withdrawn from said reserve account by Lanco Services, Inc. without the
express written permission of Lawrence Federal Savings & Loan Association, Inc.