TRANSFER AND ASSIGNMENT AGREEMENT
by and between
WESTERN FIDELITY FUNDING, INC.,
as Seller,
and
WESTERN FIDELITY FINANCE, INC.,
as Purchaser
-----------------------------------------------------
Dated as of December 30, 1996
-----------------------------------------------------
-----------------------------------------------------
TABLE OF CONTENTS
-----------------------------------------------------
Page
----
ARTICLE I
CERTAIN DEFINITIONS.......................................................... 1
ARTICLE II
PURCHASE AND SALE OF RECEIVABLES
Section 2.01. Assignment and Acquisition of Receivables.................... 2
Section 2.02. The Closing.................................................. 4
Section 2.03. The Funding Events........................................... 4
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01. Representations and Warranties of the Purchaser............. 4
Section 3.02. Representations and Warranties of the Seller................ 5
ARTICLE IV
CONDITIONS
Section 4.01. Conditions to Obligation of the Purchaser.................... 15
Section 4.02. Conditions to Obligation of the Seller....................... 17
ARTICLE V
COVENANTS OF THE SELLER
Section 5.01. Protection of Right, Title and Interest...................... 18
Section 5.02. Other Liens or Interests..................................... 18
Section 5.03. Principal Executive Office................................... 18
Section 5.04. Pledge of Proceeds........................................... 18
Section 5.05. Costs and Expenses........................................... 19
Section 5.06. No Waiver.................................................... 19
Section 5.07. Location of Servicer Files................................... 19
Section 5.08. Notice to Obligors........................................... 19
Section 5.09. Sale of Receivables.......................................... 19
i
Section 5.10. Seller's Records............................................. 19
Section 5.11. [Reserved]................................................... 19
Section 5.12. Cooperation by Seller........................................ 19
ARTICLE VI
[RESERVED]................................................................... 20
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01. Obligations of Seller........................................ 20
Section 7.02. Repurchase Events............................................ 20
Section 7.03. Purchaser's Assignment of Repurchased Receivables............ 21
Section 7.04. Subsequent Conveyance........................................ 21
Section 7.05. Amendment.................................................... 21
Section 7.06. Waivers...................................................... 21
Section 7.07. Notices...................................................... 22
Section 7.08. Costs and Expenses........................................... 22
Section 7.09. Representations.............................................. 22
Section 7.10. Confidential Information..................................... 22
Section 7.11. Headings and Cross-References................................ 22
Section 7.12. Governing Law................................................ 22
Section 7.13. Counterparts................................................. 22
Section 7.14. No Bankruptcy Petition Against the Purchaser................. 22
Section 7.15. Third Party Beneficiaries.................................... 23
EXHIBIT A- ASSIGNMENT...................................................A-1
EXHIBIT B- SCHEDULE OF RECEIVABLES .................................... B-1
EXHIBIT C- [Reserved].................................................. C-1
EXHIBIT D- FORM OF NOTICE TO OBLIGORS ................................. D-1
EXHIBIT E- FORM OF CERTIFICATE OF DELIVERY............................. E-1
EXHIBIT F- FORM OF DEALER AGREEMENT.....................................F-1
EXHIBIT G- SCHEDULE OF POTENTIAL SUBSEQUENT RECEIVABLES.................G-1
ii
TRANSFER AND ASSIGNMENT AGREEMENT
This Transfer and Assignment Agreement is made as of this 30th day of
December 1996, by and between Western Fidelity Funding, Inc., a Colorado
corporation ("Western Fidelity" or the "Seller"), having its principal place of
business at 4704 Harlan Street, Suite 260, Denver, Colorado 80212 and Western
Fidelity Finance, Inc., a Delaware corporation (the "Purchaser"), having its
principal place of business at 4704 Harlan Street, Suite 260, Denver, Colorado
80212.
WHEREAS, the Seller has originated or acquired in the ordinary course of
business, certain Receivables, each secured by a security interest granted by
the related Obligors in the Financed Vehicles financed thereby; and
WHEREAS, the Seller and the Purchaser wish to set forth the terms and
provisions pursuant to which the Receivables and the security interests of the
Seller in the Financed Vehicles relating thereto are to be absolutely assigned
by the Seller to the Purchaser, which Receivables and other assets will then be
conveyed by the Purchaser, pursuant to the terms of that certain Pooling and
Servicing Agreement dated as of December 30, 1996 (the "Pooling Agreement") by
and between the Purchaser, as depositor, and Texas Commerce Bank National
Association, as trustee (the "Trustee"), to the Trustee on behalf of the Trust
for the benefit of the Certificateholders.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Capitalized terms used but not defined in this Agreement shall have the
meanings set forth in the Pooling Agreement. As used in this Agreement, the
following terms shall, unless the context otherwise requires, have the following
meanings (such meanings to be equally applicable to the singular and plural
forms of such terms and to the masculine, feminine and neuter genders of such
terms):
"Agreement" or "Transfer and Assignment Agreement" shall mean this Transfer
and Assignment Agreement and all amendments and restatements hereof and
supplements hereto.
"Assignment" shall mean the document of assignment substantially in the
form attached to this Agreement as Exhibit A.
"Custodian File" shall have the meaning set forth in Section 4.01(d)
hereof.
"Eligible Receivable" means a Receivable which meets the requirements and
specifications set forth in Section 3.02(b) hereof.
"Knowledge" means, with respect to the Seller or the Purchaser, as the case
may be, the actual knowledge of an Authorized Officer of such Person.
"Pooling Agreement" shall mean the Pooling and Servicing Agreement dated as
of December 30, 1996 by and between the Purchaser, as depositor, and the
Trustee, as trustee, and all amendments and supplements thereto and restatements
thereof.
"Purchaser" shall mean Western Fidelity Finance, Inc., a Delaware
corporation, its successors and assigns.
"Repurchase Event" shall mean the obligation of the Seller to repurchase a
Receivable upon the occurrence of certain events as specified in Section 7.02.
"Seller" shall mean Western Fidelity Funding, Inc., a Colorado corporation,
its successors and assigns.
"Seller Conveyed Property" shall have the meaning set forth in Section
2.01(a) hereof.
ARTICLE II
PURCHASE AND SALE OF RECEIVABLES
Section 2.01. Assignment and Acquisition of Receivables. On the Closing and
on each Funding Date, subject to the terms and conditions of this Agreement, the
Seller agrees to absolutely assign to the Purchaser, and the Purchaser agrees to
acquire from the Seller, Eligible Receivables and the other Seller Conveyed
Property relating thereto.
(a) Initial Assignment of Receivables and Seller Conveyed Property. On
the Closing Date and simultaneously with the transactions pursuant to the
Pooling Agreement, the Seller shall contribute, absolutely assign and
otherwise convey to the Purchaser, without recourse except as set forth
herein, a 100% interest in (i) all right, title and interest of the Seller
in and to the Initial Receivables, and all moneys received thereon, on and
after the related Cutoff Date (except for interest accrued and actually
received from such Cutoff Date through the Closing Date, which shall be
withdrawn from the Revenue Fund, to the extent contained therein, and paid
to the Seller); (ii) the security interest of the Seller in the Financed
Vehicles granted by the Obligors pursuant to the Initial Receivables and
the certificates of title to such Financed Vehicles; (iii) the interest of
the Seller in any proceeds from claims on any physical damage, credit life
or other insurance policies covering the Financed Vehicles or the Obligors
from such Cutoff Date; (iv) any property (including the right to receive
future Liquidation Proceeds) that shall secure an Initial Receivable; (v)
2
all right, title and interest of the Seller in and to any recourse against
any Dealer pursuant to the applicable Dealer Agreement (a copy of the form
of which is attached hereto as Exhibit F); (vi) Contracts evidencing the
Initial Receivables; and (vii) the proceeds of any and all of the
foregoing. (All of the property identified in this subsection (a) and the
following subsection (c) shall constitute the "Seller Conveyed Property.")
(b) Consideration. In consideration of the Receivables and the Seller
Conveyed Property defined in Section 2.01(a), the Seller shall, on the
Closing Date, receive 1,000 shares, par value $.01 per share, of common
stock of the Purchaser.
(c) Assignment of Subsequent Receivables and Seller Conveyed Property.
On each Funding Date, the Seller shall contribute, absolutely assign and
otherwise convey to the Purchaser, without recourse except as set forth
herein, a 100% interest in (i) all right, title and interest of the Seller
in and to the Subsequent Receivables identified on a Schedule of
Receivables delivered on such Funding Date, and all moneys received
thereon, with respect to the Receivables, on and after the respective
Cutoff Date through the Funding Date (except for interest accrued and
actually received from the related Cutoff Date, which shall be withdrawn
from the Revenue Fund, to the extent contained therein, and paid to the
Seller); (ii) the security interest of the Seller in the Financed Vehicles
granted by the Obligors pursuant to such Subsequent Receivables and title
to such Financed Vehicles and the certificate of title to such Financed
Vehicles; (iii) the interest of the Seller in any proceeds from claims on
any physical damage, credit life, or other insurance policies covering such
Financed Vehicles or such Obligors from the related Cutoff Date; (iv) any
property (including the right to receive future Liquidation Proceeds) that
shall secure a Subsequent Receivable; (v) all right, title and interest of
the Seller in and to any recourse against any Dealer pursuant to the
applicable Dealer Agreement; (vi) the Contracts evidencing the Subsequent
Receivables; and (vii) the proceeds of any and all of the foregoing;
provided, however, that Subsequent Receivables may not be acquired by the
Purchaser and Granted to the Depositor if the effect of the acquisition
would be to (i) reduce the weighted average annual percentage rate of the
overall Receivables pool to less than 20.00% or (ii) increase the weighted
average remaining term to maturity of the Receivables pool to greater than
60 months. The Receivables that will constitute Subsequent Receivables
(assuming all conditions thereto are satisfied) shall be identified on a
schedule of Receivables substantially in the form of Exhibit G on the
Closing Date.
(d) Receivables Purchase Price. In consideration of the Receivables
and other Seller Conveyed Property described in Section 2.01(c), the
Purchaser shall, on each Funding Date, pay or cause to be paid to the
Seller the Receivables Purchase Price with respect to Receivables purchased
from the Seller on such date in the form of cash by federal wire transfer
(same day) funds.
3
(e) Absolute Assignment. It is the intention of the Seller and the
Purchaser that each contribution, assignment, transfer and conveyance
hereunder constitute an absolute assignment of the Seller Conveyed Property
from the Seller to the Purchaser. If, notwithstanding the express intention
of the parties, this Agreement is deemed not to constitute a sale,
conveyance and assignment of the Seller Conveyed Property from the Seller
to the Purchaser, this Agreement shall be deemed to be a security agreement
within the meaning of Article 8 and Article 9 of the Uniform Commercial
Code as in effect in the State of Colorado, and the conveyance provided for
in this Section 2.01 shall be deemed to be a grant by the Seller to the
Purchaser of a valid perfected first priority security interest in all of
the Seller's right, title and interest in and to the Seller Conveyed
Property.
(f) No Transfer or Assumption of Liabilities. In no event shall the
Seller be deemed to have transferred, nor the Purchaser to have assumed,
any obligations or liabilities of any kind or nature arising from or in
connection with any of the Seller Conveyed Property.
Section 2.02. The Closing. The absolute assignment and purchase of the
Initial Receivables shall take place at a closing (the "Closing") at the offices
of Kutak Rock, 717 17th Street, Suite 2900, Denver, Colorado 80202 on the
Closing Date, simultaneously with the closing under the Pooling Agreement
pursuant to which (a) the Purchaser will convey all of its right, title and
interest in and to the Receivables and other Seller Conveyed Property to the
Trustee on behalf of the Trust for the benefit of the Certificateholders, and
(b) the Certificates will be issued.
Section 2.03. The Funding Events. The absolute assignment and purchase of
the Subsequent Receivables on each Funding Date shall take place at the offices
of the Trustee or such other location as the Purchaser and the Seller may
reasonably agree.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01. Representations and Warranties of the Purchaser. The
Purchaser hereby represents and warrants to the Seller as of the Closing Date
and each Funding Date:
(a) Organization, Etc. The Purchaser is a corporation duly organized
under the laws of the State of Delaware and is validly existing under the
laws of the State of Delaware and has full power and authority to execute
and deliver this Agreement and to perform the terms and provisions hereof.
(b) Due Authorization. The execution, delivery and performance by the
Purchaser of this Agreement have been duly authorized by all necessary
corporate action, do not require any approval or consent of any
governmental agency or authority, do not and will not conflict with any
4
material provision of its certificate of incorporation or bylaws, and do
not and will not conflict with or result in a breach which would constitute
a material default under any agreement for borrowed money binding upon or
applicable to it or such of its property which is material to it, or, to
the Purchaser's Knowledge, any law or governmental regulation or court
decree applicable to it or such material property, and this Agreement is
the legal, valid and binding obligation of the Purchaser enforceable in
accordance with its terms except as the same may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting the
enforcement of creditors' rights or by general equity principles.
(c) No Litigation. No litigation or administrative proceeding of or
before any court, tribunal or governmental body is presently pending, or to
the knowledge of the Purchaser threatened, against the Purchaser or its
properties or with respect to this Agreement, which, if adversely
determined would, in the opinion of the Purchaser, have a material adverse
effect on the transactions contemplated by this Agreement.
(d) Business Purpose. The Purchaser will acquire the Receivables for a
bona fide business purpose and has undertaken the transactions contemplated
herein as principal rather than as agent for the Seller or any other
person.
(e) Purchaser's Records. This Agreement and all related documents
describe the assignment of the Receivables and the other Seller Conveyed
Property to the Purchaser as a purchase by the Purchaser from the Seller
and evidence the clear intention by the Purchaser to effectuate a purchase
of such Receivables and the other Seller Conveyed Property. The financial
statements and tax returns of the Purchaser will disclose that, under
generally accepted accounting principles or for tax purposes, respectively,
the Purchaser acquired ownership of the Receivables and the other Seller
Conveyed Property.
Section 3.02. Representations and Warranties of the Seller.
(a) The Seller, severally, hereby represents and warrants to the
Purchaser and its successors and assigns as of the Closing Date and each
Funding Date:
(i) Organization, Etc. The Seller is a corporation duly organized
under the laws of the State of Colorado and is validly existing and in
good standing under the laws of the State of Colorado; the Seller has
full power and authority to own its properties and to conduct its
business as such properties are currently owned and such business is
presently conducted and had at all relevant times, and has the power,
authority and legal right to acquire, own and assign the Receivables
and the other Seller Conveyed Property acquired, owned and assigned
hereunder by the Seller.
5
(ii) Due Qualification. The Seller is duly qualified to do
business as a corporation in good standing, and has obtained all
necessary licenses and approvals, in all jurisdictions in which the
ownership or lease of property or the conduct of its business shall
require such qualifications.
(iii) Power and Authority. The Seller has the power and authority
to execute and deliver this Agreement and to carry out its terms; the
Seller has full power and authority to sell and assign the property
sold and assigned to the Purchaser and has duly authorized such sale
and assignment to the Purchaser by all necessary corporate or other
action; the execution, delivery, and performance of this Agreement
have been duly authorized by the Seller by all necessary corporate or
other action, and this Agreement is the legal, valid and binding
obligation of the Seller enforceable in accordance with its terms
except as the same may be limited by insolvency, bankruptcy,
reorganization or other laws relating to or affecting the enforcement
of creditors' rights or by general equity principles.
(iv) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof
do not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of
time) a default under the articles of incorporation or bylaws of the
Seller, or any indenture, agreement or other instrument to which the
Seller is a party or by which it is bound; nor result in the creation
or imposition of any lien upon any of its properties pursuant to the
terms of any such indenture, agreement or other instrument (other than
this Agreement); nor violate any law or, to Seller's Knowledge, any
order, rule or regulation applicable to the Seller of any court or of
any federal or state regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over the Seller or
its properties.
(v) No Proceedings. To the Seller's Knowledge, there are no
proceedings or investigations pending, or threatened, before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties:
(A) asserting the invalidity of this Agreement; (B) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement; or (C) seeking any determination or ruling that might
materially and adversely affect the performance by the Seller of its
obligations under, or the validity or enforceability of, this
Agreement.
(vi) No Consents, Approvals. Neither the execution nor the
delivery by the Seller of this Agreement, or the performance of the
Seller's obligations hereunder, require the consent or approval of,
the giving of notice to, the registration with, or the taking of any
other action with respect to, any governmental authority or agency
under any existing federal or state law governing the Seller, except
such as have been previously obtained, made or taken.
6
(vii) No Unpaid Taxes. All tax returns required to be filed by
the Seller in any jurisdiction have been filed, and all taxes,
assessments, fees and other governmental charges upon it or any
subsidiary or upon any of their respective properties, income or
franchises, shown to be due and payable on such returns have been
paid. To the Seller's Knowledge, all such tax returns were true and
correct when filed and neither it nor any subsidiary knows of any
proposed additional tax assessment against it in any material amount
or of any basis therefor.
(viii) Adequate Provisions for Taxes. The provisions for taxes on
the Seller's books are in accordance with generally accepted
accounting principles in effect as of the date hereof.
(ix) Pension/Profit Sharing Plans. No contribution failure has
occurred with respect to any pension or profit sharing plan of the
Seller, and all such plans have been fully funded as of the date of
this Agreement.
(x) Trade Names. "Western Fidelity Funding, Inc." is the only
trade name under which the Seller is currently operating its business.
For the six (6) years (or such shorter period of time during which the
Seller was in existence) preceding the Closing Date, the Seller
operated its business under the trade name "Western Fidelity Funding,
Inc."
(xi) Ability to Perform. There has been no material impairment in
the ability of the Seller to perform its obligations under this
Agreement.
(xii) Valid Business Reasons; No Fraudulent Transfers. The Seller
has valid business reasons for assigning the Receivables and the other
Seller Conveyed Property, rather than obtaining a secured loan with
the Receivables and the other Seller Conveyed Property as collateral.
At the time of the transfer: (A) the Seller assigned the Receivables
and the other Seller Conveyed Property to the Purchaser without any
intent to hinder, delay, or defraud any current or future creditor of
the Seller; (B) the Seller was not insolvent and did not become
insolvent as a result of the transfer; (C) the Seller was not engaged
and was not about to engage in any business or transaction for which
any property remaining with the Seller was an unreasonably small
capital or for which the remaining assets of such Seller were
unreasonably small in relation to the business of the Seller or the
transaction; (D) the Seller did not intend to incur, and did not
believe or reasonably should not have believed that it would incur,
debts beyond its ability to pay as they become due; and (E) the
consideration paid by the Purchaser to the Seller for the Subsequent
Receivables absolutely assigned by the Seller hereunder was equivalent
to a fair market value of the Receivables under the circumstances of
the transaction, including but not limited to, timing of such sale.
7
(xiii) Principal Executive Office. Since its inception, the
Seller, has maintained, and, from the date of this Agreement, shall
maintain, its principal executive office in the State of Colorado, and
there has been no other state in which the Seller's principal
executive office was located during the four (4) months preceding the
Closing Date.
(xiv) No Omission or Misstatement. Neither this Agreement nor any
statement, report or other document furnished or to be furnished
pursuant to this Agreement by the Seller, or in connection with the
transactions contemplated hereby, contains any untrue statement of
fact or omits to state a fact necessary to make the statements
contained herein or therein not misleading in so far as the same
relates to the Seller. The Seller has good and marketable title to,
and is the owner of, each Receivable sold by the Seller hereunder, and
the indebtedness evidenced by each such Receivable is subject to no
lien, charge, security interest or encumbrance of any kind or nature
and the Seller has the unqualified right to contribute, transfer,
convey and assign its ownership interest in each such Receivable and
the indebtedness evidenced thereby; the Seller has not made any prior
assignment of any Receivable or its rights thereto or thereunder.
(xv) There are no injunctions, writs, restraining orders or other
orders of any nature to which the Seller is subject that would
adversely affect the Seller's performance of this Agreement or
transaction contemplated thereby.
(xvi) Seller will treat the transfer of assets contemplated
herein as a sale for federal income tax, reporting and accounting
purposes.
(xvii) If payments are not to be remitted directly to the
Servicer, each Obligor of a Receivable will be directed, and will be
required to remit payments to, a lockbox or other similar account.
(xviii) No event has occurred which would adversely affect the
ability of the Seller to perform its obligations under this Agreement
or the Servicing Agreement and the transactions contemplated thereby.
(b) The Seller makes the following representations and warranties as
to each of the Receivables absolutely assigned hereunder on which
representations and warranties the Purchaser relies in acquiring the
Receivables. Such representations and warranties speak as of the execution
and delivery of this Agreement and as of the Closing Date or Funding Date,
as the case may be, but shall survive the assignment of the Receivables to
the Purchaser and the subsequent conveyance of the Receivables by the
Purchaser to the Trustee pursuant to the Pooling Agreement:
8
(i) Characteristics of Receivables. Each Receivable (A) has been
originated in the United States of America by a Dealer for the retail
sale of a Financed Vehicle in the ordinary course of such Dealer's
business, has been fully and properly executed by the parties thereto,
(B) has been assigned, together with the security interest in the
related Financed Vehicle, by the applicable Dealer to the Seller,
under an existing agreement with the Seller, (C) has created or
creates a valid, subsisting, and enforceable first priority security
interest in favor of the Seller in the related Financed Vehicle, which
security interest shall be assigned by the Seller to the Purchaser in
accordance with the terms of this Agreement, (D) contains customary
and enforceable provisions such that the rights and remedies of the
holder thereof shall be adequate for realization against the
collateral of the benefits of the security, (E) is denominated in U.S.
dollars and generally provides for level monthly payments that fully
amortize the amount financed by maturity and yield interest at the
Annual Percentage Rate and (F) the Seller has no reason to believe
that the Receivable is due from an Obligor which is not a citizen of
the United States.
(ii) Schedule of Receivables. The information set forth in
Exhibit B to this Agreement is true and correct in all material
respects as of the close of business on the Cutoff Date, no selection
procedures believed to be adverse to the Purchaser have been utilized
in selecting the Receivables and the geographic distribution of the
Obligors with respect to the Receivables absolutely assigned hereunder
or the credit quality characteristics of the Receivables absolutely
assigned to the Purchaser hereunder are not materially different from
the Seller's existing portfolio. The information on the computer tape
regarding the Receivables made available to the Purchaser and its
assigns is true and correct in all material respects.
(iii) Form of Receivables. Each of the Receivables is
substantially in a form approved for use in the applicable state in
which it was originated.
(iv) Compliance with Law. Each Receivable and the sale of the
related Financed Vehicle complied at the time it was originated or
made, and on the Closing Date does comply, in all material respects
with all requirements of applicable federal, state and local laws, and
regulations thereunder, including, without limitation, usury laws, the
Fair Credit Reporting Act, the Federal Truth-in-Lending Act, the Equal
Credit Opportunity Act, the Fair Debt Collection Practices Act, the
Federal Trade Commission Act, the Magnuson-Moss Warranty Act, the
Federal Reserve Board's Regulations B and Z, the applicable Consumer
Credit Act, 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.
9
(v) Binding Obligation. Each Receivable represents the genuine,
legal, valid and binding payment obligation in writing of the Obligor,
enforceable by the owner thereof in accordance with its terms.
(vi) No Government Obligor. The Receivable is not due from the
United States of America or any State or from any agency, department
or instrumentality of the United States of America or any state.
(vii) Security Interest in Financed Vehicle. Immediately prior to
the assignment thereof, the Receivable was secured by a first priority
security interest in the Financed Vehicle in favor of the Seller as
secured party, or all necessary and appropriate actions have been
commenced that would result in the valid perfection of a first
priority security interest in the Financed Vehicle in favor of the
Seller upon completion of processing by the applicable state agency,
and the Seller has a clear legal right to repossess the Financed
Vehicle upon the occurrence of certain matters including non-payment
under the Receivable.
(viii) Receivables in Force. The Receivable has not been
satisfied, subordinated or rescinded, nor has the related Financed
Vehicle been released from the lien granted by such Receivable in
whole or in part.
(ix) No Waiver. No provision of the Receivable has been waived,
impaired, altered or modified in any respect, except to the extent
permitted in accordance with the Servicing Agreement, the substance of
which is reflected in the Schedule of Receivables as it relates to the
information included thereon.
(x) No Amendments. The Receivable has not been amended such that
either the original Receivable Balance was modified or reduced or the
number of the originally scheduled due dates have been increased
except to the extent permitted in accordance with the Servicing
Agreement.
(xi) No Defenses. No right of rescission, recoupment, setoff,
counterclaim or defense has been asserted or threatened with respect
to the Receivable.
(xii) No Liens. No Liens or claims have been filed for work,
labor or materials relating to the related Financed Vehicle that would
be Liens prior to, or equal or pari passu with, the security interest
in such Financed Vehicle granted by the related Obligor pursuant to
the Receivable.
10
(xiii) No Default. Except for payment delinquencies continuing
for a period of not more than 30 days as of the applicable Cutoff
Date, no default, breach, violation or event permitting acceleration
under the terms of the Receivable has occurred; and no continuing
condition that, with notice or the lapse of time or both would
constitute a default, breach, violation or event permitting
acceleration under the terms of the Receivable has arisen, and the
Seller has not waived any of the foregoing. As of the date hereof, the
Seller has no knowledge that such Receivable would not be paid in
full, other than the fact that the Obligor thereof is not a prime
credit.
(xiv) Origination Date. All of the Receivables absolutely
assigned hereunder have been originated on or before the applicable
Cutoff Date. Each Receivable has a Scheduled Payment due once per
calendar month.
(xv) Insurance. In connection with the purchase of the
Receivable, the Seller required the related Dealer to furnish evidence
that has been verified by the Seller that the related Financed Vehicle
was covered by a comprehensive and collision policy subject to a
deductibility not in excess of $500 (i) naming the Seller as a loss
payee and (ii) insuring against loss and damage due to fire, theft,
transportation, collision and other risks generally covered by
comprehensive and collision coverage.
(xvi) Title. It is the intention of the Seller that the
assignment herein contemplated constitute an absolute assignment of
the Receivables from the Seller to the Purchaser and that the
beneficial interest in and title to the Receivables not be part of the
estate of the Seller in the event of the filing of a bankruptcy
petition by or against the Seller under any bankruptcy law. Except
with respect to any security interest which has been released in
connection with the assignment of the Receivable hereunder, the
Receivable has not been sold, transferred, assigned or pledged by the
Seller to any Person other than the Purchaser. Except with respect to
Liens of warehouse providers that will be removed immediately prior to
the assignment herein contemplated, the Seller had good and marketable
title to the Receivable free and clear of all Liens and, immediately
upon the transfer thereof, the Purchaser will have good and marketable
title to such Receivable, free and clear of all Liens, except any Lien
which will be released prior to assignment hereunder and the Lien
created by the Pooling Agreement; and the security interest in the
Receivable has been validly perfected under the UCC and other
applicable law, if any.
(xvii) Lawful Assignment. The Receivable has not been originated
in, nor is it subject to the laws of, any jurisdiction under which the
assignment or conveyance of such Receivable under this Agreement or
under the Pooling Agreement would be unlawful, void or voidable.
11
(xviii) All Filings Made. All filings (including, without
limitation, UCC filings) necessary in any jurisdiction to give the
Purchaser a first perfected ownership interest in the Receivables have
been made.
(xix) One Original. There is only one original executed copy of
the Contract evidencing such Receivable.
(xx) Maturity of Receivables. At origination, the Receivable had
a term of no more than 60 payments, such Receivable calls for even
monthly payments, is fully amortizing and the final Scheduled Payment
on such Receivable is due on or before February 15, 2002.
(xxi) Annual Percentage Rate. The Receivable has an Annual
Percentage Rate of at least 17%.
(xxii) Outstanding Receivable Balance; Down Payment. The
Receivable has an outstanding balance of at least $1,000 and no more
than $35,000, and the related Obligor has paid the entire amount of
the down payment required in the Seller's underwriting policies.
(xxiii) Financing. The Receivable is a Simple Interest
Receivable.
(xxiv) Bankruptcy Proceeding. The Receivable was not noted, as of
the applicable Cutoff Date, in the Seller's records as a dischargeable
debt under a bankruptcy proceeding, and the Receivable has not been
reduced or discharged in any bankruptcy proceeding.
(xxv) Chattel Paper, Valid and Binding. The Receivable
constitutes "chattel paper" as defined in the UCC and is legal, valid
and binding in accordance with its terms.
(xxvi) State of Origination. At the time of origination, the
Obligor of the Receivable was located in one of the following States:
Colorado, Georgia, Illinois, Iowa, Indiana, Kansas, Kentucky,
Missouri, Nebraska, New Jersey, New Mexico, North Carolina, Ohio,
Oklahoma, Pennsylvania, Tennessee, Texas and West Virginia or such
other state as may be agreed upon between the Seller and the Purchaser
(with the consent of the Placement Agent).
(xxvii) No Future Advances to Obligor. The full principal amount
of the Receivable has been advanced to the Obligor or advanced in
accordance with the directions of such Obligor, and there is no
requirement for future advances thereunder. The Obligor with respect
to the Receivable does not have any options under the Receivable to
borrow from any Person additional funds secured by the Financed
Vehicle. The Receivable Balance of each Receivable as of the Closing
Date or Funding Date, as the case may be, is fully secured by the
related Financed Vehicle.
12
(xxviii) Underwriting Guidelines. The Receivable has been
originated in accordance with the underwriting guidelines of the
Seller.
(xxix) Resident Obligor. The Obligor with respect to the
Receivable is legally residing in the United States.
(xxx) Receivable Balance. The Receivable does not have a
Receivable Balance which includes capitalized interest, physical
damage insurance or late charges and no Receivable has a Receivable
Balance exceeding 0.1% of the Aggregate Receivable Balance.
(xxxi) Servicing. At the Cutoff Date, the Receivable was being
serviced by the Seller.
(xxxii) Original Principal Amount. The original principal amount
of the Receivable was not more than (A) with respect to a new Financed
Vehicle, 120% of the manufacturer's suggested retail price or, (B)
with respect to a used Financed Vehicle, 115% of the retail value of
the Financed Vehicle at the time of origination of the Receivable as
set forth in the NADA Used Car Guide for the appropriate region plus
add-ons, taxes, warranty and credit life insurance.
(xxxiii) Agreement. The representations and warranties of the
Seller in this Agreement are true.
(xxxiv) No Proceedings. There are no proceedings or
investigations pending, or, to the knowledge of the Seller,
threatened, before any court, regulatory body, administrative agency
or other governmental instrumentality having jurisdiction over the
Seller or its properties: (A) asserting the invalidity, illegality or
lack of enforceability of the Receivable; (B) seeking to prevent the
enforcement of the Receivable; (C) seeking any determination or ruling
that might materially and adversely affect the payment on or
enforceability of the Receivable or (D) relating to the bankruptcy or
insolvency of the related Obligor.
(xxxv) Collection Procedures. The collection practices utilized
by any Person servicing the Receivable in seeking payment under the
documentation evidencing such Receivable have been in accordance with
the Seller's collection policies and are in all respects legal and
customary in the automobile loan servicing business.
(xxxvi) No Litigation. The Receivable has not been in litigation
or restructured.
13
(xxxvii) No Charge Off. The Receivable has not been charged off
for accounting purposes by the Seller.
(xxxviii) Normal Procedures. Each Receivable has been originated,
serviced and administered pursuant to the Seller's normal credit,
administration, collection and charge-off procedures.
(xxxix) No Fraud, Misrepresentation. No Receivable has been
originated with any fraud or misrepresentation.
(xli) Dealer Agreements. The Dealer that sold such Receivable to
the Seller entered into a Dealer Agreement with the Seller and such
Dealer Agreement constitutes or, at the time of sale of such
Receivable to the Seller, did constitute the entire agreement between
the Seller and the related Dealer with respect to the sale of such
Receivable to the Seller. Such Dealer Agreement is or, at the time of
sale of such Receivable to the Seller, was in full force and effect
and is or was, at the time of such sale, the legal, valid and binding
obligation of such Dealer; with respect to any Dealer Agreement that
remains in effect, there have been no material defaults by such Dealer
or by the Seller under such Dealer Agreement; the Seller has fully
performed all of its obligations under such Dealer Agreement; the
Seller has not made any statements or representations to such Dealer
(whether written or oral) inconsistent with any term of such Dealer
Agreement; the purchase price (as specified in the applicable Dealer
Agreement) for such Receivable has been paid in full by the Seller;
there is no other payment due to such Dealer from the Seller for the
purchase of such Receivable; such Dealer has no right, title or
interest in or to any Receivable; there is no prior course of dealing
between such Dealer and the Seller which will affect the terms of such
Dealer Agreement.
(xlii) Obligor Responsibility. The Receivable contains provisions
requiring the Obligor (A) to assume all risk of loss or malfunction of
the related Financed Vehicle, (B) to maintain liability and collision
insurance with respect thereto, (C) to pay all sales, use, property,
excise and other similar taxes imposed on or with respect to the
related Financed Vehicle and (D) to be liable for all payments
required to be made thereunder, without any setoff, counterclaim or
defense for any reason whatsoever, subject only to the Obligor's right
of quiet enjoyment.
(xliii) Substitution, etc. The Receivable does not provide for
the substitution, exchange or addition of any Financed Vehicle subject
to such Receivable.
(xliv) Assignments. The rights with respect to such Receivable
are assignable without the consent of any Person other than consents
which will have been obtained on or before the Closing Date or Funding
Date, as the case may be.
14
(xlv) Seller Fulfilled All Obligations. The Seller has duly
fulfilled all obligations to be fulfilled under or in connection with
the origination, acquisition and assignment of the Receivable,
including, without limitation, giving any notices or consents
necessary to effect the conveyance of the Receivable to the Trustee,
and has done nothing to impair the rights of the Trustee and the
Certificateholders in payments with respect thereto. The Seller has
obtained all necessary licenses, permits and charters required to be
obtained by the Seller, which failure to obtain would render any
portion of the documents executed in connection with the assignment
from the Seller to the Purchaser, the conveyance to the Trustee in
trust, and the issuance and sale of the Certificates unenforceable or
would have a material adverse effect on the Certificateholders.
(xlvi) Prior Payments. Prior to the Closing Date or Funding Date,
as the case may be, the Seller has received at least one Scheduled
Payment with respect to the Receivable.
ARTICLE IV
CONDITIONS
Section 4.01. Conditions to Obligation of the Purchaser. The obligation of
the Purchaser to acquire the Receivables is subject to the satisfaction of the
following conditions:
(a) Representations and Warranties True. The representations and
warranties of the Seller hereunder shall be true and correct on the Closing
Date or Funding Date, as the case may be, with the same effect as if then
made, and the Seller shall have performed all obligations to be performed
by it hereunder on or prior to the Closing Date or Funding Date, as the
case may be.
(b) Files Marked; Files and Records Owned by Purchaser. The Seller
shall, at its own expense, on or prior to the Closing Date or Funding Date,
as the case may be, indicate in its files that the Receivables have been
absolutely assigned to the Purchaser pursuant to this Agreement and the
Seller shall deliver to the Purchaser a Schedule of Receivables certified
by the Chairman, the President, a Vice President or the Treasurer of the
Seller to be true, correct and complete. Further, the Seller hereby agrees
that the computer files and other physical records of the Receivables
maintained by the Seller will bear an indication reflecting that the
Receivables are owned by the Purchaser.
15
(c) Documents to be Delivered by the Seller on or in connection with
the Closing Date or Funding Date:
(i) The Assignment. As of the Closing Date and each Funding Date,
the Seller shall execute an Assignment substantially in the form of
Exhibit A hereto of the Receivables being absolutely assigned by the
Seller on such date (as identified on the Schedule of Receivables
attached to such Assignment substantially in the form of Exhibit B
hereto) and the security interests in the related Financed Vehicles.
(ii) Evidence of UCC Filings. On or prior to the Closing Date or
Funding Date, as the case may be, the Seller shall provide the
Purchaser evidence that the Seller has recorded and filed or will
cause to be recorded and filed, at its own expense, (A) UCC-3
termination statements in each jurisdiction in which required by
applicable law, to release any prior security interests in the
Receivables assigned by the Seller and (B) UCC financing statements in
each jurisdiction in which required by applicable law, executed by the
Seller, as seller or debtor, and naming the Purchaser, as purchaser or
secured party, identifying the Receivables and the other Seller
Conveyed Property as collateral, meeting the requirements of the laws
of each such jurisdiction and in such manner as is necessary to
perfect the contribution, transfer, assignment and conveyance of such
Receivables to the Purchaser. The Seller shall deliver the Perfection
UCC's, or other evidence satisfactory to the Purchaser of such filing,
to the Trustee within 30 days following the Closing Date or Funding
Date, as the case may be, or promptly following such later date as
such file-stamped copies, or other evidence is received by or on
behalf of the Purchaser.
(iii) Other Documents. Such other documents as the Purchaser may
reasonably request.
(d) Documents to be Delivered by the Seller in Connection with the
Closing Date or Funding Date. No more than ten (10) Business Days following
the Closing Date or Funding Date, as the case may be, the Seller shall
deliver or cause to be delivered to the Trustee the following documents:
(i) the sole original counterpart of the Contract evidencing each
such Receivable and any and all amendments thereto; and
(ii) (A) the original certificate of title or copies of
correspondence to the appropriate state title registration agency, and
all enclosures thereto, for issuance of the original certificate of
title or (B) if the appropriate state title registration agency issues
a letter or other form of evidence of lien in lieu of a certificate of
title, the original lien entry letter or form or copies of
correspondence to such state title registration agency, and all
enclosures thereto, for issuance of the original lien entry letter or
form.
16
Such delivery of Custodian Files shall be accompanied by a Certificate
of Delivery substantially in the form of Exhibit E hereto; provided,
however, that, with respect to the Custodian Files delivered pursuant to
this subsection (d) of this Section 4.01, any original certificate of title
or other evidence of lien not so delivered to the Trustee due to the fact
that such title or other document has not yet been issued by a State title
registration agency and delivered to or on behalf of the Seller, shall be
delivered by the Seller to the Trustee no later than 120 days following the
Closing Date or Funding Date, as the case may be; further provided,
however, that for any original certificate of title or other document
evidencing the Seller's status as lienholder not so delivered to the
Trustee, the Seller shall be deemed to be in breach of its representations
and warranties contained in Section 3.02(b) hereof, and such occurrence
shall constitute a Repurchase Event pursuant to Section 7.02 hereof.
(e) Other Transactions. The transactions contemplated by the Pooling
Agreement and the Servicing Agreement shall be consummated on the Closing
Date.
Section 4.02. Conditions to Obligation of the Seller. The obligation of the
Seller to absolutely assign the Receivables to the Purchaser on the Closing Date
or a Funding Date, as the case may be, is subject to the satisfaction of the
following conditions:
(a) Representations and Warranties True. The warranties of the
Purchaser hereunder shall be true and correct on the Closing Date or
Funding Date, as the case may be, with the same effect as if then made, and
the Purchaser shall have performed all obligations to be performed by it
hereunder on or prior to the Closing Date or Funding Date, as the case may
be.
(b) Proceedings. All corporate and legal proceedings and all
instruments in connection with the transactions contemplated by this
Agreement shall be satisfactory in form and substance to the Seller, and
the Seller shall have received from the Purchaser copies of all documents
(including, without limitation, records of minutes of directors'
proceedings) relevant to the transactions herein contemplated as the Seller
may reasonably have requested.
ARTICLE V
COVENANTS OF THE SELLER
The Seller agrees with the Purchaser as follows:
17
Section 5.01. Protection of Right, Title and Interest.
(a) Filings. The Seller shall cause all financing statements and
continuation statements and any other necessary documents covering the
right, title and interest of the Purchaser in and to the Receivables and
the other Seller Conveyed Property to be promptly filed, and at all times
to be kept recorded, registered and filed, all in such manner and in such
places as may be required by law fully to preserve and protect the right,
title and interest of the Purchaser hereunder to the Receivables and the
other Seller Conveyed Property. The Seller shall deliver or cause to be
delivered to or at the direction of the Purchaser, file-stamped copies of,
or filing receipts for, any document recorded, registered or filed as
provided above, as soon as available following such recordation,
registration or filing. The Purchaser shall cooperate fully with the Seller
in connection with the obligations set forth above and will execute any and
all documents reasonably required to fulfill the intent of this Section
5.01(a).
(b) Name Change. Within fifteen days after the Seller makes any change
in its name, identity or corporate structure which would make any financing
statement or continuation statement filed in accordance with paragraph (a)
above seriously misleading within the applicable provisions of the UCC or
any title statute, the Seller shall give the Purchaser notice of any such
change, and, no later than five (5) days after the effective date thereof,
the Seller shall file such financing statements or amendments as may be
necessary to continue the perfection of the Purchaser's security interest
in the Seller Conveyed Property.
Section 5.02. Other Liens or Interests. Except for the assignments
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any Lien on, any
interest in, the Receivables and other Seller Conveyed Property, and the Seller
shall defend the right, title, and interest of the Purchaser in, to and under
such Receivables and other Seller Conveyed Property against all claims of third
parties claiming through or under the Seller; provided, however, that the
obligations of the Seller under this Section 5.02 shall terminate upon the
termination of the Pooling Agreement.
Section 5.03. Principal Executive Office. Since its inception, the Seller
has maintained and, from the date of this Agreement, shall maintain, its
principal executive office in the State of Colorado.
Section 5.04. Pledge of Proceeds. The Seller has assigned to the Purchaser
hereunder, and the Purchaser has conveyed to the Trustee under the Pooling
Agreement for the benefit of the Certificateholders, any and all proceeds
received by or on behalf of such Seller as named insured or as an additional
insured under any such policy for claims made with respect to any Receivable
sold to the Purchaser hereunder and hereby irrevocably appoints the Trustee
(such appointment being coupled with an interest) to endorse on behalf of the
Seller any drafts issued by any insurer thereunder if not endorsed pursuant to
Section 5.12 hereof.
18
Section 5.05. Costs and Expenses. The Seller agrees to pay all reasonable
costs and disbursements in connection with the perfection, as against all third
parties, of the absolute assignment to the Purchaser of the Seller's right,
title and interest in and to the Receivables.
Section 5.06. No Waiver. The Seller shall not waive any default, breach,
violation or event permitting acceleration under the terms of any Receivable.
Section 5.07. Location of Servicer Files. The Servicer Files, exclusive of
the Custodian Files, are to be kept at the Servicer's offices. The Custodian
Files are to be kept at the principal executive office of the Trustee or such
other office of the Trustee as specified in the Pooling Agreement.
Section 5.08. Notice to Obligors. The Seller shall deliver or cause to be
delivered within 30 days after the Closing Date or Funding Date, as the case may
be, by first class mail, postage prepaid, written notice to each Obligor
substantially in the form of Exhibit D hereto indicating that the Obligor's
related Receivable has been absolutely assigned to the Purchaser and that all
payments with respect to such Receivable are required to be paid, on and after
the date of receipt of such notice, to the Seller, as Servicer. The Seller
shall, on or before the thirty-fifth day following the Closing Date or Funding
Date, as the case may be, deliver a written certificate to the Purchaser and the
Trustee certifying that the written notice described in the immediately
preceding sentence was timely mailed to each Obligor.
Section 5.09. Sale of Receivables. The Seller will take no action
inconsistent with the Purchaser's ownership of the Receivables. If a third
party, including a potential purchaser of the Receivables should inquire, the
Seller will promptly indicate that ownership of the Receivables has been
transferred to the Purchaser.
Section 5.10. Seller's Records. This Agreement and all related documents
describe the assignment of the Receivables and the other Seller Conveyed
Property from the Seller as an absolute assignment by the Seller to the
Purchaser and evidence the clear intention by the Seller to effectuate an
absolute assignment of such Receivables. The financial statements and tax
returns of the Seller will disclose that, under generally accepted accounting
principles, and for federal income tax purposes, the Seller transferred
ownership of the Receivables to the Purchaser.
Section 5.11. [Reserved].
Section 5.12. Cooperation by Seller.
(a) The Seller will cooperate fully and in a timely manner with the
Purchaser, the Supervisory Servicer or the Trustee in connection with (i)
the filing of any claims with an insurer or any agent of any insurer under
any insurance policy affecting an Obligor or any of the Financed Vehicles;
(ii) supplying any additional information as may be requested by the
Purchaser, the Supervisory Servicer, the Trustee or any such agent or
19
insurer in connection with the processing of any such claim; and (iii) the
execution or endorsement of any check or draft made payable to the Seller
representing proceeds from any such claim. The Seller shall take all such
actions as may be requested by the Purchaser, the Supervisory Servicer or
the Trustee to protect the rights of the Purchaser or the Trustee on behalf
of the Certificateholders in and to any proceeds under any and all of the
foregoing insurance policies. The Seller shall not take or cause to be
taken any action which would impair the rights of the Purchaser or the
Trustee on behalf of the Certificateholders in and to any proceeds under
any of the foregoing insurance policies.
(b) The Seller shall, within one (1) Business Day of receipt thereof,
endorse any check or draft payable to the Seller representing insurance
proceeds and (i) in the event there are no other payees on such check or
draft, deposit such endorsed check or draft, into the Collection Account
within one (1) Business Day of receipt thereof; and (ii) in the event such
check or draft is also payable to the Trustee, forward, via overnight
courier, on behalf of the Certificateholders, to the Trustee such endorsed
check or draft. The Seller will hold in trust and remit to the Trustee, any
funds received with respect to the Receivables after the applicable Cutoff
Date.
ARTICLE VI
[RESERVED]
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01. Obligations of Seller. The obligations of the Seller under
this Agreement shall not be affected by reason of any invalidity, illegality or
irregularity of any Receivable.
Section 7.02. Repurchase Events. The Seller hereby covenants and agrees to
deliver to the Purchaser prompt written notice of the occurrence of a breach of
any of the representations and warranties of the Seller contained or deemed to
be contained in Section 3.02(b) hereof with respect to a Receivable absolutely
assigned hereunder. Upon discovery by any of the Seller, the Depositor, the
Trustee or the Servicer of (a) a Nonconforming Receivable or (b) failure to
deliver to the Trustee either (i) any document required to be included in the
Custodian File, or (ii) the Perfection UCCs, pursuant to Section 7.18 of the
Pooling Agreement, the party discovering such breach or failure to deliver shall
give prompt written notice to each of the other foregoing parties. Except as
specifically provided in the Servicing Agreement or Pooling Agreement, neither
the Supervisory Servicer nor the Trustee has any obligation to review or monitor
the Seller Conveyed Property for compliance with representations and warranties
or delivery requirements. If (i) the breach of representations or warranties
causing such Receivable to be a Nonconforming Receivable shall not have been (A)
20
cured within 30 days following notice thereof or (B) waived by the Trustee with
Certificateholder Approval within thirty days following notice thereof or (ii)
the failure to deliver to the Trustee the Custodian File documents or the
Perfection UCCs shall not have been cured within seven calendar days following
notice thereof, the Purchaser shall upon receipt of the Repurchase Price
therefor, assign to the Seller the Receivable and the other items of the related
Seller Conveyed Property affected by such breach or failure to deliver within
five Business Days following the earlier of (i) the end of the cure period, if
any, and (ii) the receipt and deposit into the Collection Account by the
Servicer of the Repurchase Price with respect to a Nonconforming Receivable or
failure to deliver the documents described above. Any such Receivable so removed
shall not be deemed to be a Defaulted Receivable for purposes of this Section
7.02. The Purchaser shall be entitled to enforce the obligations of the Seller
and the applicable Dealer to repurchase such Receivables hereunder and under the
respective Dealer Agreement and the Trustee is authorized, pursuant to the
Pooling Agreement, to take action on behalf of the Purchaser to enforce the
obligations of the Seller and the applicable Dealer to repurchase such
Receivables hereunder and under the respective Dealer Agreement.
The obligations of the Seller and the Purchaser to (i) remove any
Receivable and the other related items of the Seller Conveyed Property and (ii)
remit or cause the applicable Dealer to remit the Repurchase Price with respect
to a Nonconforming Receivable or as to which a failure to deliver has occurred
and is continuing shall constitute the sole remedy, except for the
indemnification provisions expressly set forth herein, in the Pooling Agreement
and in the Servicing Agreement, against the Seller and the Purchaser for such
breach, failure to deliver or non-payment available to the Trustee or the
Certificateholders.
Section 7.03. Purchaser's Assignment of Repurchased Receivables. With
respect to any Receivable repurchased by the Seller pursuant to this Agreement,
the Purchaser shall assign, without recourse, representation or warranty, to the
Seller all the Purchaser's right, title and interest in and to such Receivable,
and all security and documents relating thereto.
Section 7.04. Subsequent Conveyance. The Seller acknowledges that the
Purchaser will convey the Receivables and the other Seller Conveyed Property,
along with the Purchaser's rights and benefits hereunder, to the Trustee
pursuant to the terms of the Pooling Agreement, and that the terms and
provisions hereof are intended to benefit the Certificateholders. The Seller
hereby consents to such conveyance.
Section 7.05. Amendment. This Agreement may be amended, restated or
supplemented from time to time by a written agreement duly executed and
delivered by the Seller and the Purchaser, but only with the prior written
consent of the Trustee.
Section 7.06. Waivers. No failure or delay on the part of the Purchaser in
exercising any power, right or remedy under this Agreement or an Assignment
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power, right or remedy preclude any other or further exercise thereof
or the exercise of any other power, right or remedy. Any waiver of the terms and
provisions hereof must be in writing and must be consented to in writing by the
Trustee.
21
Section 7.07. Notices. All notices, requests, consents and other
communications hereunder shall be in writing and shall be delivered personally
or mailed by first-class registered or certified mail, postage prepaid, or by
telephonic facsimile transmission and overnight delivery service, postage
prepaid, to any party at its address shown in the opening portion of this
Agreement or at such other address as may be designated by it by notice to the
other party and shall be deemed given when so delivered, or if mailed.
Section 7.08. Costs and Expenses. The Seller shall pay all expenses,
including fees and expenses of counsel, incident to the performance of its
obligations under this Agreement and the Seller agrees to pay all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees, in
connection with the enforcement of any obligation of the Seller hereunder. The
Purchaser shall pay all expenses, including fees and expenses of counsel,
incident to the performance of its obligations under this Agreement.
Section 7.09. Representations. The respective agreements, representations,
warranties and other statements by the Seller and the Purchaser set forth in or
made pursuant to this Agreement shall remain in full force and effect and will
survive the Closing Date or Funding Date, as the case may be, under Section 2.02
hereof.
Section 7.10. Confidential Information. The Purchaser agrees that it will
neither use nor disclose to any person the names and addresses of the Obligors,
except in connection with the enforcement of the Purchaser's rights hereunder,
under the Receivables, or any agreement relating to the Receivables or as
required by law.
Section 7.11. Headings and Cross-References. The various headings in this
Agreement are included for convenience only and shall not affect the meaning or
interpretation of any provision of this Agreement. References in this Agreement
to Section names or numbers are to such Sections of this Agreement.
Section 7.12. Governing Law. This Agreement and the Assignment shall be
governed by and construed in accordance with the internal laws of the State of
Colorado.
Section 7.13. Counterparts. This Agreement may be executed in two or more
counterparts and by different parties on separate counterparts, each of which
shall be an original, but all of which together shall constitute one and the
same instrument.
Section 7.14. No Bankruptcy Petition Against the Purchaser. The Seller
agrees that, prior to the date that is one year and one day after the payment in
full of all amounts payable with respect to the Certificates, it will not
institute against the Purchaser, or join any other Person in instituting against
the Purchaser, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings or other proceedings under the laws of the United States
or any state of the United States. This Section 7.14 shall survive the
termination of the Pooling Agreement.
22
Section 7.15. Third Party Beneficiaries. This Agreement shall inure to the
benefit of the Purchaser, the Trustee, the Certificateholders and their
respective successors and assigns. Without limiting the generality of the
foregoing, all representations, covenants and agreements in this Agreement which
expressly confer rights upon the Purchaser, the Trustee or the
Certificateholders shall be for the benefit of and run directly to the
Purchaser, the Trustee, the Certificateholders and the Purchaser, the Trustee
and the Certificateholders shall be entitled to rely on and enforce such
representations, covenants and agreements to the same extent as if it were a
party hereto.
23
IN WITNESS WHEREOF, the parties hereby have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
and year first above written.
WESTERN FIDELITY FUNDING, INC., as Seller
By /s/ Gene E. Osborn
-------------------------------------
Gene E. Osborn, President
WESTERN FIDELITY FINANCE, INC., as
Purchaser
By: /s/ Gene E. Osborn
------------------------------------
Gene E. Osborn, President
24
EXHIBIT A
ASSIGNMENT
For value received in the form of [common stock] [cash] , in accordance
with the terms of the Transfer and Assignment Agreement dated as of December 30,
1996 (the "Transfer and Assignment Agreement") by and between Western Fidelity
Funding, Inc., as seller (the "Seller"), and Western Fidelity Finance, Inc., as
purchaser (the "Purchaser"), the undersigned does hereby contribute, assign,
transfer and otherwise convey unto the Purchaser, without recourse, a 100%
interest in and to (i) the Receivables identified on the Receivables Schedule
and all moneys received thereon, with respect to the Receivables, on and after
the respective Cutoff Date (except for interest accrued and actually received
from the Cutoff Date through the [Closing Date][Funding Date] which will be
withdrawn from the Revenue Fund, to the extent contained therein, and paid to
the Seller), (ii) a security interest in the Financed Vehicles granted by the
Obligors pursuant to such [Subsequent] Receivables and the certificate of title
to such Financed Vehicles; (iii) the interest of the Seller in any proceeds from
claims on any physical damage, credit life, or other insurance policies covering
the Financed Vehicles or the Obligors from the applicable Cutoff Date; (iv) any
property (including the right to receive future Liquidation Proceeds) that shall
secure a [Subsequent] Receivable, (v) all right, title and interest of the
Seller in and to any recourse against any Dealer pursuant to the applicable
Dealer Agreement, (vi) the original Contracts evidencing the Receivables, and
(vii) the proceeds of any and all of the foregoing. The foregoing contribution,
assignment, transfer and conveyance does not constitute and is not intended to
result in any assumption by the Purchaser of any obligation of the undersigned
to the Obligors, insurers or any other person in connection with the
[Subsequent] Receivables, Servicer Files (as defined in the Servicing
Agreement), any insurance policies or any agreement or instrument relating to
any of them.
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the
Transfer and Assignment Agreement and is to be governed by the Transfer and
Assignment Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meaning assigned to them in the Transfer and Assignment Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be duly
executed as of ______________, 199__.
WESTERN FIDELITY FUNDING, INC.
By
---------------------------------
Gene E. Osborn, President
A-1
EXHIBIT B
SCHEDULE OF RECEIVABLES
Next
Loan Original Monthly Current PMTS Interest Payment
Number Principal Payment Term Principal Left Rate Date
- -----------------------------------------------------------------------------------------------------------------------------------
Contract New
Date Make Model Year Used
- --------------------------------------------------------------------------------
B-1
EXHIBIT C
[Reserved]
C-1-1
EXHIBIT D
FORM OF NOTICE TO OBLIGORS
Re: Loan Number:
Dear :
---------------
You are hereby notified that Western Fidelity Funding, Inc. ("Seller") has
absolutely assigned its interest in the above-referenced loan (the "Loan") to
Western Fidelity Finance, Inc. (the "Purchaser") and the Purchaser has
absolutely assigned its interest in the Loan to Texas Commerce Bank National
Association, as trustee of the Western Fidelity Receivables Trust 1996-A (the
"Trust"). Western Fidelity Funding, Inc. (the "Servicer") will continue to
service this Loan on behalf of the Trust. Unless you are otherwise notified by
the Purchaser or the Servicer, you should direct all payments and inquiries to:
Western Fidelity Funding, Inc.
4704 Harlan Street, Suite 260
Denver, Colorado 80212
Date: WESTERN FIDELITY FUNDING, INC.
--------------
By ------------------------------
Name:----------------------------
Title:---------------------------
D-1
EXHIBIT E
FORM OF CERTIFICATE OF DELIVERY
In connection with the absolute assignment of certain auto loan receivables
to Western Fidelity Finance, Inc. (the "Purchaser") the undersigned, as seller
(the "Seller"), hereby certifies that the documents listed below are included in
the Custodian Files (as defined below) delivered to Texas Commerce Bank National
Association, as trustee ("Trustee") pursuant to the terms of that certain
Pooling and Servicing Agreement dated as of December 30, 1996 by and between the
Purchaser and the Trustee (the "Pooling Agreement") for each of the Receivables
listed on the attached Receivables Schedule. Unless otherwise defined herein,
capitalized terms have the meanings set forth in the Pooling Agreement.
(a) the sole original counterpart of the Contract evidencing each such
Receivable and any and all amendments thereto; and
(b) (i) the original certificate of title or copies of correspondence
to the appropriate State title registration agency, and all enclosures
thereto, for issuance of the original certificate of title or (ii) if the
appropriate state title registration agency issues a letter or other form
of evidence of lien in lieu of a certificate of title, the original lien
entry letter or form or copies of correspondence to such state title
registration agency, and all enclosures thereto, for issuance of the
original lien entry letter or form (collectively, the "Custodian Files");
WESTERN FIDELITY FUNDING, INC.
Date: , 199 By -------------------------------
------------- -- Name:-----------------------------
Title:----------------------------
E-1
EXHIBIT F
FORM OF DEALER AGREEMENT
F-1