FINGERHUT RECEIVABLES, INC.
Buyer
and
FINGERHUT COMPANIES, INC.
Seller
PURCHASE AGREEMENT
Dated as of January 12, 1997
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 Definitions . . . . . . . . . . . . . . 1
Section 1.2 Other Definitional Provisions . . . . . 2
ARTICLE II
PURCHASE, CONVEYANCE AND SERVICING
OF RECEIVABLES . . . . . . . . . . . . . . . . . . . 4
Section 2.1 Sale . . . . . . . . . . . . . . . . . . 4
ARTICLE III
CONSIDERATION AND PAYMENT . . . . . . . . . . . . . . 7
Section 3.1 Purchase Price . . . . . . . . . . . . . 7
Section 3.2 Payment of Purchase Price . . . . . . . 7
Section 3.3 Settlement . . . . . . . . . . . . . . . 7
ARTICLE IV
REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . 7
Section 4.1 Seller's Representations and Warranties 9
Section 4.2 Seller's Representations and Warranties
Regarding Receivables . . . . . . . . 12
Section 4.3 Representations and Warranties of
the Buyer . . . . . . . . . . . . . . 14
ARTICLE V
COVENANTS OF SELLER AND BUYER . . . . . . . . . . . . 17
Section 5.1 Seller Covenants . . . . . . . . . . . . 17
Section 5.2 Addition of Receivables . . . . . . . . 19
Section 5.3 Buyer Covenant Regarding Sale Treatment 19
Section 5.4 Buyer Covenant Regarding Separate
Business . . . . . . . . . . . . . . . 19
ARTICLE VI
REPURCHASE OBLIGATION . . . . . . . . . . . . . . . . 18
Section 6.1 Mandatory Repurchase . . . . . . . . . . 21
Section 6.2 Conveyance of Reassigned Receivables . . 22
ARTICLE VII
CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . 23
Section 7.1 Conditions to the Buyer's Obligations
Regarding Receivables . . . . . . . . 23
Section 7.2 Conditions Precedent to the Seller's
Obligations . . . . . . . . . . . . . 23
ARTICLE VIII
TERM AND TERMINATION . . . . . . . . . . . . . . . . 25
Section 8.1 Term . . . . . . . . . . . . . . . . . . 25
Section 8.2 Effect of Termination . . . . . . . . . 25
ARTICLE IX
MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . 27
Section 9.1 Amendment . . . . . . . . . . . . . . . 27
Section 9.2 Governing Law . . . . . . . . . . . . . 27
Section 9.3 Notices . . . . . . . . . . . . . . . . 27
Section 9.4 Severability of Provisions . . . . . . . 27
Section 9.5 Assignment . . . . . . . . . . . . . . . 28
Section 9.6 Further Assurances . . . . . . . . . . . 28
Section 9.7 No Waiver; Cumulative Remedies . . . . . 28
Section 9.8 Counterparts . . . . . . . . . . . . . . 29
Section 9.9 Binding Effect; Third-Party
Beneficiaries . . . . . . . . . . . . 29
Section 9.10 Merger and Integration. . . . . . . . 29
Section 9.11 Headings . . . . . . . . . . . . . . . . 29
Section 9.12 Schedules and Exhibits . . . . . . . . . 29
Section 9.13 No Bankruptcy Petition Against the Buyer 29
Section 9.14 Merger or Consolidation of, or Assumption
of the Obligations of, the Seller . . 29
Section 9.15 Protection of Right, Title and Interest to
Receivables . . . . . . . . . . . . . 30
Exhibit A Form of Weekly Report
Schedule 1 Seller's Chief Executive Office
Schedule 2 Tax Returns and Payments
PURCHASE AGREEMENT
PURCHASE AGREEMENT, dated as of January 12,
1997 (the "Agreement"), by and between FINGERHUT
COMPANIES, INC., a Minnesota corporation (the "Seller"),
and FINGERHUT RECEIVABLES, INC., a Delaware corporation
("FRI" or the "Buyer").
W I T N E S S E T H :
WHEREAS, the Buyer desires to purchase from
time to time certain closed-end installment loan contract
receivables generated or acquired on or after the Initial
Closing Date by the Seller, the Bank or any Affiliate
thereof;
WHEREAS, the Seller desires to sell and assign
from time to time certain closed-end installment loan
contract receivables to the Buyer upon the terms and
conditions hereinafter set forth;
WHEREAS, the Buyer is an Affiliate of the
Seller;
NOW, THEREFORE, it is hereby agreed by and
between the Buyer and the Seller as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. For all purposes of
this Agreement, except as otherwise expressly provided
herein or unless the context otherwise requires,
capitalized terms used herein shall have the following
meanings assigned to them:
"Bank" shall mean Fingerhut National Bank.
"Credit Adjustment" shall have the meaning set
forth in Section 3.2(b) hereof.
"Debtor Relief Law" shall mean any of (i) the
Bankruptcy Code of the United States of America and (ii)
all other applicable liquidation, conservatorship,
bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, suspension of payments,
readjustment of debt, marshalling of assets or similar
debtor relief laws of the United States, any state or any
foreign country from time to time in effect affecting the
rights of creditors generally.
"Initial Closing Date" shall mean January 12,
1997.
"Involuntary Case" shall have the meaning set
forth in Section 2.1(c) hereof.
"Opinion of Counsel" shall mean a written
opinion of counsel acceptable to the Buyer and the
Seller, which counsel may be an employee of the Seller.
"Pooling and Servicing Agreement" shall mean
the Amended and Restated Pooling and Servicing Agreement
dated as of January 12, 1997 among FRI, as Transferor,
Fingerhut National Bank, as Servicer, and The Bank of New
York (Delaware), as Trustee, and any amendments and
supplements thereto.
"Purchase Price" shall have the meaning set
forth in Section 3.1 hereof.
"Sale Papers" shall have the meaning set forth
in Section 4.1(a) hereof.
"Secured Obligations" shall have the meaning
set forth in Section 2.1(f) hereof.
"Seller's Discount" shall mean, for any day on
which Receivables are conveyed hereunder, the discount
used to determine the Seller's accounting basis in the
Receivables on such day.
"Termination Date" shall have the meaning set
forth in Section 8.1 hereof.
Section 1.2 Other Definitional Provisions.
The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement or any Sale
Paper shall refer to this Agreement as a whole and not to
any particular provision of this Agreement; and Section,
Subsection, Schedule and Exhibit references contained in
this Agreement are references to Sections, Subsections,
Schedules and Exhibits in or to this Agreement unless
otherwise specified. All capitalized terms not otherwise
defined herein are defined in the Pooling and Servicing
Agreement. In the event that any term or provision
contained herein shall conflict with or be inconsistent
with any provisions contained in the Pooling and
Servicing Agreement, the terms and provisions contained
herein shall govern with respect to this Agreement.
[END OF ARTICLE I]
ARTICLE II
PURCHASE, CONVEYANCE AND SERVICING
OF RECEIVABLES
Section 2.1 Sale. (a) In consideration for
the Purchase Price and upon the terms and subject to the
conditions set forth herein, the Seller does hereby sell,
assign, transfer, set-over, and otherwise convey to the
Buyer, and the Buyer does hereby purchase from the
Seller, on the terms and subject to the conditions
specifically set forth herein, all of the Seller's right,
title and interest in, to and under (i) the Receivables
now existing and hereafter created, in each case,
immediately upon the Seller's acquisition of rights
therein, and all monies due or to become due with respect
thereto, (ii) Recoveries, (iii) the Bank Receivables
Purchase Agreement with respect to closed-end installment
loan contract receivables of Back-End Customers and (iv)
all proceeds of the foregoing. The foregoing sale,
transfer, assignment, set-over and conveyance does not
constitute and is not intended to result in a creation or
an assumption by the Buyer of any obligation of the
Seller in connection with the Receivables or any
agreement or instrument relating thereto, including,
without limitation, any obligation to any Obligors or
insurers, or in connection with the Bank Receivables
Purchase Agreement.
(b) In connection with the foregoing sale, the
Seller agrees to record and file on or prior to the
Initial Closing Date, at its own expense, a financing
statement or statements with respect to the Receivables
and the other property described in Section 2.1(a) sold
by the Seller hereunder meeting the requirements of
applicable state law in such manner and in such
jurisdictions as are necessary to perfect and protect the
interests of the Buyer created hereby under the
applicable UCC against all creditors of and purchasers
from the Seller, and to deliver a file-stamped copy of
such financing statements or other evidence of such
filings to the Buyer within 10 days after the Initial
Closing Date.
(c) The Buyer shall not purchase Receivables
hereunder if the Seller shall become an involuntary party
to (or be made the subject of) any bankruptcy proceeding
or any other insolvency, readjustment of debt,
marshalling of assets and liabilities or similar
proceedings of or relating to the Seller or relating to
all or substantially all of its property (an "Involuntary
Case") upon receipt by the Seller at its head corporate
office of notice of such Involuntary Case.
(d) The Buyer shall not purchase Receivables
hereunder if the Seller shall admit in writing its
inability to pay its debts as they are due, or the Seller
shall commence a voluntary case under the federal
bankruptcy laws, as now or hereafter in effect, or any
present or future federal or state bankruptcy, insolvency
or similar law, or the Seller shall consent to the
appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator or
other similar official of the Seller or of any
substantial part of its property or the Seller shall make
an assignment for the benefit of creditors or the Seller
shall fail generally to pay its debts as such debts
become due or the Seller shall take corporate action in
furtherance of any of the foregoing.
(e) In connection with the sale and conveyance
hereunder, the Seller agrees, at its own expense, on or
prior to the Initial Closing Date and on each Business
Day thereafter, to indicate or cause to be indicated
clearly and unambiguously in its accounting records, and
with respect to any Receivables purchased by the Seller
from the Bank, to cause the Bank to indicate clearly and
unambiguously in the Bank's accounting records, that such
Receivables and the other property described in clauses
(i), (ii) and (iii) of Section 2.1(a) have been sold to
the Buyer pursuant to this Agreement as of the Initial
Closing Date or such Business Day as applicable.
(f) It is the express intent of the Seller and
the Buyer that the conveyance of the Receivables by the
Seller to the Buyer pursuant to this Agreement be
construed as a sale of such Receivables by the Seller to
the Buyer. It is, further, not the intention of the
Seller and the Buyer that such conveyance be deemed a
grant of a security interest in the Receivables by the
Seller to the Buyer to secure a debt or other obligation
of the Seller. However, in the event that,
notwithstanding the intent of the parties, the
Receivables are held to continue to be property of the
Seller, then (i) this Agreement also shall be deemed to
be and hereby is a security agreement within the meaning
of the UCC; and (ii) the conveyance by the Seller
provided for in this Agreement shall be deemed to be and
the Seller hereby grants to the Buyer a security interest
in and to all of the Seller's right, title and interest
in (w) all Receivables outstanding on the Initial Closing
Date and thereafter created or acquired by the Seller, in
each case, immediately upon the Seller's acquisition of
rights therein, and all rights (but not the obligations)
relating to such Receivables, including, without
limitation, all "accounts" or "general intangibles" (each
as defined in the applicable UCC) with respect to the
Receivables outstanding on the Initial Closing Date and
thereafter created or acquired by the Seller, and all
rights (but not the obligations) relating thereto, (x)
all monies due or to become due with respect thereto, (y)
the Bank Receivables Purchase Agreement with respect to
closed-end installment loan contract receivables of Back-
End Customers and (z) all proceeds of the foregoing to
secure (1) the rights of the Buyer and (2) a loan to the
Seller in the amount of the Purchase Price as set forth
in this Agreement (the "Secured Obligations"). The
Seller and the Buyer shall, to the extent consistent with
this Agreement, take such actions as may be necessary to
ensure that, if this Agreement were deemed to create a
security interest in the Receivables, such security
interest would be deemed to be a perfected security
interest of first priority in favor of the Buyer under
applicable law and will be maintained as such throughout
the term of this Agreement. The Seller and the Buyer may
rely upon an Opinion of Counsel addressed to them as to
what is required to provide the Buyer with such security
interest; and any such Opinion of Counsel shall permit
the Trustee, on behalf of the Certificateholders, the
Certificateholders (in the case of any Series issued in a
placement exempt from the registration requirements of
the Securities Act) and the Rating Agencies to rely on
it.
[END OF ARTICLE II]
ARTICLE III
CONSIDERATION AND PAYMENT
Section 3.1 Purchase Price. The Purchase
Price for the Receivables and related property conveyed
to the Buyer under this Agreement shall be a dollar
amount equal to, for Receivables sold on any date, the
product of (i) the aggregate Outstanding Balance of all
such Receivables as of such date, and (ii) one minus the
then applicable Seller's Discount.
Section 3.2 Payment of Purchase Price.
(a) The Purchase Price for Receivables shall be paid or
provided for on the Initial Closing Date with respect to
the Receivables existing on the Initial Closing Date and
on each Business Day thereafter on which Receivables are
transferred hereunder, as the case may be, by payment in
immediately available funds to the extent such funds are
available. To the extent that the total Purchase Price
for Receivables is not paid in full by the Buyer on the
Initial Closing Date or on each Business Day on which
Receivables are purchased hereunder in cash, the Seller
shall be deemed to have contributed Receivables in an
aggregate principal amount equal to such shortfall to the
Buyer.
(b) The Purchase Price shall be adjusted on a
monthly basis (a "Credit Adjustment") with respect to any
Receivable adjusted as provided in subsection 3.8 of the
Pooling and Servicing Agreement in an amount equal to the
amount of such Credit Adjustment specified in subsection
3.8 of the Pooling and Servicing Agreement. If the Buyer
is required thereunder to deposit amounts into the Excess
Funding Account, the Seller shall pay the amount so
adjusted to the Buyer.
Section 3.3 Settlement. On each Tuesday (or
if any Tuesday is not a Business Day the next succeeding
Business Day), the Seller shall deliver to the Buyer a
Weekly Report showing the aggregate Purchase Price of
Receivables generated or acquired, the aggregate amount
of Receivables deemed to have been contributed by the
Seller to the Buyer, the aggregate amount, if any, paid
to the Buyer pursuant to Section 6.1 hereof, and the
aggregate amount of cash paid for Receivables generated
or acquired in each case for the period from and
including the preceding Tuesday (or next succeeding
Business Day, as applicable) to but not including such
Tuesday.
[END OF ARTICLE III]
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1 Seller's Representations and
Warranties. The Seller represents and warrants to the
Buyer as of the Initial Closing Date, and shall be deemed
to represent and warrant as of the date of any Supplement
and the related Closing Date, that:
(a) Organization and Good Standing. The
Seller is a corporation duly organized and validly
existing in good standing under the laws of the State of
Minnesota and has the corporate power and authority and
legal right to own its property and conduct its business
as such properties are presently owned and as such
business is presently conducted and to execute, deliver
and perform its obligations under this Agreement and each
other document or instrument to be delivered by the
Seller hereunder (collectively, the "Sale Papers").
(b) Due Qualification. The Seller is duly
qualified to do business and is in good standing (or is
exempt from such requirements), as a foreign corporation
in any state required in order to conduct its business,
and has obtained all necessary licenses and approvals
with respect to the Seller required under applicable law.
(c) Due Authorization. The execution and
delivery of Sale Papers, and the consummation of the
transactions provided for herein and therein have been
duly authorized by the Seller by all necessary corporate
action on its part.
(d) Binding Obligation. Each of the Sale
Papers, and the consummation of the transactions provided
for therein, constitutes a legal, valid and binding
obligation of the Seller, enforceable in accordance with
its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereinafter in
effect, affecting the enforcement of creditors' rights in
general and as such enforceability may be limited by
general principles of equity (whether considered in a
proceeding at law or in equity).
(e) No Conflicts. The execution and delivery
of the Sale Papers and the performance of the
transactions contemplated thereby, do not (i) contravene
the Seller's charter or by-laws, (ii) violate any
material provision of law applicable to it, or (iii)
require any filing (except for the filings under the
UCC), registration, consent or approval under, any law,
rule, regulation, order, writ, judgment, injunction,
decree, determination or award presently in effect having
applicability to the Seller, except for such filings,
registrations, consents or approvals as have already been
obtained and are in full force and effect.
(f) Taxes. Except as specified on Schedule 2,
the Seller has filed all tax returns required to be filed
and has paid or made adequate provision for the payment
of all taxes, assessments and other governmental charges
due from the Seller or is contesting any such tax,
assessment or other governmental charge in good faith
through appropriate proceedings.
(g) No Violation. The execution and delivery
of the Sale Papers, the performance of the transactions
contemplated by the Sale Papers and the fulfillment of
the terms thereof, will not violate any Requirements of
Law applicable to the Seller, will not violate, result in
any breach of any of the material terms and provisions of
or constitute (with or without notice or lapse of time or
both) a default under (i) any Requirement of Law
applicable to the Seller, or (ii) any material indenture,
contract, agreement, mortgage, deed of trust or other
material instrument to which the Seller is a party or by
which it or its properties are bound.
(h) No Proceedings. There are no proceedings
or investigations pending or, to the best knowledge of
the Seller, threatened against the Seller before any
Governmental Authority (i) asserting the invalidity of
the Sale Papers, (ii) seeking to prevent the consummation
of any of the transactions contemplated thereby, (iii)
seeking any determination or ruling that would materially
and adversely affect the performance by the Seller of its
obligations thereunder or (iv) seeking any determination
or ruling that would materially and adversely affect the
validity or enforceability thereof.
(i) All Consents Required. All approvals,
authorizations, consents, orders or other actions of any
Governmental Authority required in connection with the
execution and delivery of the Sale Papers, the
performance of the transactions contemplated by the Sale
Papers and the fulfillment of the terms hereof and
thereof, have been obtained.
(j) Bona Fide Receivables. Each Receivable is
or will be an account receivable arising out of the
performance by the applicable Originator in accordance
with the terms of the Contract giving rise to such
Receivable. The Seller has no knowledge of any fact
which should have led it to expect at the time of the
classification of any Receivable as an Eligible
Receivable that such Receivable would not be paid in full
when due, and each Receivable classified as an Eligible
Receivable by the Seller in any document or report
delivered under this Agreement satisfies the requirements
of eligibility contained in the definition of Eligible
Receivable set forth in the Pooling and Servicing
Agreement.
(k) Place of Business. The principal
executive offices of the Seller are in Minnetonka,
Minnesota and the offices where the Seller keeps its
records concerning the Receivables and related Contracts
are in ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ and
Hennepin County, Minnesota.
(l) Use of Proceeds. No proceeds of the sale
of any Receivable hereunder received by the Seller will
be used by the Seller to purchase or carry any margin
stock.
(m) Pay Out Event. As of the Initial Closing
Date, no Pay Out Event and no condition that with the
giving of notice and/or the passage of time would
constitute a Pay Out Event (a "Prospective Pay Out
Event"), has occurred and is continuing.
(n) Not an Investment Company. The Seller is
not an "investment company" within the meaning of the
Investment Company Act, or is exempt from all provisions
of such Act.
The representations and warranties set forth in
this Section 4.1 shall survive the sale of the
Receivables to the Buyer. The Seller hereby represents
and warrants to the Buyer, that the representations and
warranties of the Seller set forth in Section 4.1 are
true and correct as of such date. Upon discovery by the
Seller or the Buyer of a material breach of any of the
foregoing representations and warranties, the party
discovering such breach shall give prompt written notice
thereof to the other.
Section 4.2 Seller's Representations and
Warranties Regarding Receivables.
(a) Valid Sale, etc. The Seller (x) hereby
represents and warrants as of the Initial Closing Date,
with respect to the Receivables acquired by the Seller on
such date and (y) shall be deemed to represent and
warrant as of the date of the acquisition by the Seller
and transfer to the Buyer of any Receivables with respect
to such Receivables, that:
(i) Each of this Agreement and the Bank
Receivables Purchase Agreement constitutes the
legal, valid and binding obligation of the Seller,
enforceable against the Seller in accordance with
its terms, except (A) as such enforceability may be
limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now
or hereafter in effect, affecting the enforcement of
creditors' rights in general, and (B) as such
enforceability may be limited by general principles
of equity (whether considered in a suit at law or in
equity).
(ii) The transfer of Receivables by the
Seller to the Buyer under this Agreement constitutes
a valid sale, transfer, assignment, set-over and
conveyance to the Buyer of all right, title and
interest of the Seller in and to the Receivables,
whether then existing or thereafter created, and
such Receivables will be held by the Buyer free and
clear of any Lien of any Person claiming through or
under the Seller or any of its Affiliates except for
Permitted Liens. This Agreement constitutes a valid
sale, transfer, assignment, set-over and conveyance
to the Buyer of all right, title and interest of the
Seller in and to the Receivables purported to be
sold hereunder, whether then existing or thereafter
created and the proceeds thereof.
(iii) The Seller is not insolvent and
will not be rendered insolvent upon sale of the
Receivables to the Buyer.
(iv) The Seller is (or, with respect to
Receivables arising after the date hereof, will be)
the legal and beneficial owner of all right, title
and interest in and to each Receivable and each
Receivable has been or will be transferred to the
Buyer free and clear of any Lien other than
Permitted Liens.
(v) All consents, licenses, approvals or
authorizations of or registrations or declarations
with any Governmental Authority required in
connection with the transfer of such Receivables to
the Buyer have been obtained.
(vi) Each Receivable classified as an
"Eligible Receivable" by the Seller in any document
or report delivered hereunder will satisfy the
requirements contained in the definition of Eligible
Receivable as of the time of such document or
report.
(vii) Each Receivable then existing has
been conveyed to the Buyer free and clear of any
Lien of any Person claiming through or under the
Seller or any of its Affiliates (other than
Permitted Liens) and in compliance, in all material
respects, with all Requirements of Law applicable to
the Seller.
(b) Daily Representations and Warranties. On
each day on which any new Receivable is created or
acquired by the Seller, the Seller shall be deemed to
represent and warrant to the Buyer that (A) each
Receivable purchased by the Buyer on such day has been
conveyed to the Buyer in compliance, in all material
respects, with all Requirements of Law applicable to the
Seller and free and clear of any Lien of any Person
claiming through or under the Seller or any of its
Affiliates (other than Permitted Liens) and (B) with
respect to each such Receivable, all consents, licenses,
approvals or authorizations of or registrations or
declarations with, any Governmental Authority required to
be obtained, effected or given by the Seller in
connection with the conveyance of such Receivable to the
Buyer have been duly obtained, effected or given and are
in full force and effect.
(c) Notice of Breach. The representations and
warranties set forth in this Section 4.2 shall survive
the sale, transfer and assignment of the respective
Receivables to the Buyer. Upon discovery by the Seller
or the Buyer of a breach of any of the representations
and warranties set forth in this Section 4.2, the party
discovering such breach shall give prompt written notice
thereof to the other. The Seller agrees to cooperate
with the Buyer in attempting to cure any such breach.
Section 4.3 Representations and Warranties of
the Buyer. The Buyer hereby represents and warrants and
agrees with, as of the date hereof and as of the Initial
Closing Date, the Seller and shall be deemed to represent
and warrant as of the date of the creation of any
Receivable sold to the Buyer hereunder that:
(a) Organization and Good Standing. The Buyer
is a corporation duly organized and validly existing in
good standing under the laws of the State of Delaware and
has the corporate power and authority and legal right to
own its property and conduct its business as such
properties are presently owned and such business is
presently conducted and to execute, deliver, and perform
its obligations under the Sale Papers.
(b) Due Qualification. The Buyer is duly
qualified to do business and is in good standing (or is
exempt from such requirements) as a foreign corporation
in any state required in order to conduct business and
has obtained all necessary licenses and approvals with
respect to the Buyer required under federal and Delaware
law.
(c) Due Authorization. The execution and
delivery of the Sale Papers and the consummation of the
transactions provided for in the Sale Papers have been
duly authorized by the Buyer by all necessary corporate
action on its part.
(d) No Conflicts. The execution and delivery
of the Sale Papers and the performance of the
transactions contemplated thereby do not (i) contravene
the Buyer's certificate of incorporation or by-laws or
(ii) violate any material provision of law applicable to
it, or require any filing (except for the filings under
the UCC), registration, consent or approval under, any
law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award presently in effect having
applicability to the Buyer, except for such filings,
registrations, consents or approvals as have already been
obtained and are in full force and effect.
(e) No Violation. The execution and delivery
of the Sale Papers, the performance of the transactions
contemplated by the Sale Papers, and the fulfillment of
the terms of the Sale Papers will not violate any
Requirements of Law applicable to the Buyer, will not
violate, result in any breach of any of the material
terms and provisions of, or constitute (with or without
notice or lapse of time or both) a default under any
Requirement of Law applicable to the Buyer, or any
material indenture, contract, agreement, mortgage, deed
of trust or other material instrument to which the Buyer
is a party or by which it or its properties are bound.
(f) No Proceedings. There are no proceedings
or investigations pending or, to the best knowledge of
the Buyer, threatened against the Buyer, before any
Governmental Authority (i) asserting the invalidity of
the Sale Papers, (ii) seeking to prevent the consummation
of any of the transactions contemplated by the Sale
Papers, (iii) seeking any determination or ruling that
would materially and adversely affect the performance by
the Buyer of its obligations thereunder or (iv) seeking
any determination or ruling that would materially and
adversely affect the validity or enforceability of the
Sale Papers.
(g) All Consents Required. All approvals,
authorizations, consents, orders, or other actions of any
Governmental Authority required in connection with the
execution and delivery of the Sale Papers, the
performance of the transactions contemplated by the Sale
Papers, and the fulfillment of the terms of the Sale
Papers have been obtained.
The representations and warranties set forth in
this Section 4.3 shall survive the sale of the
Receivables to the Buyer. The Buyer hereby represents
and warrants to the Seller that the representations and
warranties of the Buyer set forth in Section 4.3 are true
and correct as of such date. Upon discovery by the Buyer
or the Seller of a breach of any of the foregoing
representations and warranties, the party discovering
such breach shall give prompt written notice to the
other.
[END OF ARTICLE IV]
ARTICLE V
COVENANTS OF SELLER AND BUYER
Section 5.1 Seller Covenants. The Seller
hereby covenants that:
(a) Receivables to be Accounts or General
Intangibles. The Seller will take no action to cause any
Receivable to be evidenced by any instrument (as defined
in the UCC as in effect in the Relevant UCC State),
except in connection with the enforcement or collection
of a Receivable. Except in such circumstances, the
Seller will take no action to cause any Receivable to be
anything other than an "account" or a "general
intangible" (each as defined in the UCC as in effect in
the Relevant UCC State).
(b) Security Interests. Except for the
conveyances 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
Receivable, whether now existing or hereafter created, or
any interest therein; the Seller will immediately notify
the Buyer of the existence of any Lien on any Receivable;
and the Seller shall defend the right, title and interest
of the Buyer in, to and under the Receivables, whether
now existing or hereafter created, against all claims of
third parties claiming through or under the Seller;
provided, however, that nothing in this subsection 5.1(b)
shall prevent or be deemed to prohibit the Seller from
suffering to exist upon any of the Receivables any
Permitted Lien.
(c) Contracts and Credit and Collection
Policies. The Seller shall take all actions reasonably
within its control to cause each Originator to comply
with and perform its obligations under the Contracts
relating to the Receivables and the Credit and Collection
Policy except insofar as any failure to comply or perform
would not materially and adversely affect the rights of
the Buyer. The Seller may change, and permit an
Originator to change, the terms and provisions of the
Contracts or the Credit and Collection Policy in any
respect (i) if it would not, in the reasonable belief of
the Seller, materially impair the collectibility of any
Receivable or cause, immediately or with the passage of
time, a Pay Out Event to occur and (ii) if such change
(A) (if it owns a comparable segment of receivables) is
made applicable to the comparable segment of the
receivables owned by the Seller or such Originator, if
any, which have characteristics the same as, or
substantially similar to, the Receivables that are the
subject of such change and (B) (if it does not own such a
comparable segment of receivables) will not be made with
the intent to materially benefit the Seller over the
Buyer or to materially adversely affect the Buyer, except
as otherwise restricted by an endorsement, sponsorship,
or other agreement between the Seller and an unrelated
third party or by the terms of the Contracts.
(d) [Reserved]
(e) Delivery of Collections. In the event
that the Seller receives Collections, the Seller agrees
to deposit such Collections into the Collection Account
as soon as practicable after the receipt thereof, but in
no event later than the second Business Day following the
Date of Processing thereof.
(f) Conveyance of Receivables. Except as
provided in Section 9.5, the Seller covenants and agrees
that it will not convey, assign, exchange or otherwise
transfer any Receivable, to any Person other than the
Buyer prior to the termination of this Agreement pursuant
to Article VIII; provided, however, that the Seller shall
not be prohibited hereby from conveying, assigning,
exchanging or otherwise transferring a Receivable in
connection with a transaction in which the Seller and its
successor agree to comply with provisions substantially
similar to those of Section 9.14.
(g) Notice of Liens. The Seller shall notify
the Buyer promptly after becoming aware of any Lien on
any Receivable other than Permitted Liens.
(h) Separate Business. The Seller will not
permit its assets to be commingled with those of the
Buyer and the Seller shall maintain separate corporate
records and books of account from those of the Buyer.
The Seller will not conduct its business in the name of
the Buyer and will cause the Buyer to conduct its
business solely in its own name so as not to mislead
others as to the identity of the entity with which those
others are concerned. The Seller will provide for its
own operating expenses and liabilities from its own
funds. The Seller will not hold itself out, or permit
itself to be held out, as having agreed to pay, or as
generally being liable for, the debts of the Buyer. The
Seller shall cause the Buyer not to hold itself out, or
permit itself to be held out, as having agreed to pay, or
as being liable for, the debts of the Seller. The Seller
will maintain an arm's length relationship with the Buyer
with respect to any transactions between the Seller, on
the one hand, and the Buyer, on the other.
Section 5.2 Addition of Receivables.
Unless the Seller specifies to the contrary,
all receivables which meet the definition of Receivables
shall be included as Receivables from and after the date
upon which such Receivables are created and all such
Receivables, whether such Receivables are then existing
or thereafter created or acquired, shall be sold
automatically to the Buyer upon creation or acquisition
by the Seller.
Section 5.3 Buyer Covenant Regarding Sale
Treatment. The Buyer agrees to treat this conveyance for
all purposes (including, without limitation, tax and
financial accounting purposes) as a sale on all relevant
books, records, tax returns, financial statements and
other applicable documents.
Section 5.4 Buyer Covenant Regarding Separate
Business. The Buyer shall at all times (i) to the extent
the Buyer's office is located in the offices of any
Affiliate of the Buyer, pay fair market rent for its
office space located in the offices of such affiliate and
a fair share of any overhead costs, (ii) maintain the
Buyer's books, financial statements, accounting records
and other corporate documents and records separate from
those of its Affiliates or any other entity, (iii) not
commingle the Buyer's assets with those of any Affiliate
or any other entity, (iv) maintain the Buyer's books or
account and payroll (if any) separate from those of any
affiliate of the Buyer, (v) act solely in its corporate
name and through its own authorized officers and agents,
invoices and letterhead, (vi) separately manage the
Buyer's liabilities from those of any of its Affiliates
and pay its own material liabilities, including all
material administrative expenses, from its own separate
assets, provided that the Buyer's stockholder or other
Affiliates may pay certain of the organizational expenses
of the Buyer and expenses relating to the preparation,
negotiation, execution and delivery of the documentation
with respect to the issuance of Certificates from time to
time, and the Buyer shall reimburse any Affiliate for its
allocable portion of shared expenses paid by such
Affiliate, and (vii) pay from the Buyer's assets all
obligations and indebtedness of any kind incurred by the
Buyer except as otherwise provided in clause (vi). The
Buyer shall abide by all corporate formalities, including
the maintenance of current minute books, and the Buyer
shall cause its financial statements to be prepared in
accordance with generally accepted accounting principles
in a manner that indicates the separate existence of the
Buyer and its assets and liabilities. The Buyer shall
not assume the liabilities of any Affiliate, and shall
not guarantee the liabilities of any Affiliate. The
officers and directors of the Buyer (as appropriate)
shall make decisions with respect to the business and
daily operations of Buyer independent of and not dictated
by any Affiliate of the Buyer.
[END OF ARTICLE V]
ARTICLE VI
REPURCHASE OBLIGATION
Section 6.1 Mandatory Repurchase.
(a) Breach of Warranty. In the event of a
breach with respect to a Receivable of any of the
representations and warranties set forth in Section
4.1(j) or subsections 4.2(a)(iii) through (vii) or
4.2(b), or in the event that a Receivable is not an
Eligible Receivable on the date of its transfer to the
Buyer as a result of the failure to satisfy the
conditions set forth in the definition of Eligible
Receivable, such Receivable shall be designated an
"Ineligible Receivable" and the Seller shall pay to the
Buyer an amount in cash equal to the purchase price paid
for any such Ineligible Receivable by the Buyer to the
Seller. Such payment must be made by the close of
business on the fifth Business Day following the day such
Receivable has been designated an Ineligible Receivable;
provided, however, that such amount may be offset against
any amounts due from the Buyer to the Seller with respect
to the Purchase Price for Receivables sold to the Buyer
on such day. The obligation of the Seller set forth in
this Section shall constitute the sole remedy respecting
any breach of the representations and warranties set
forth in the above-referenced Sections or failure to meet
the conditions set forth in the definition of Eligible
Receivable with respect to such Receivable available to
the Buyer.
(b) Reassignment of the Sold Assets. In the
event of a breach of any of the representations and
warranties set forth in Section 4.1(a), (b), and (c) and
4.2(a)(i) and (ii), the Buyer by notice given in writing
to the Seller may direct the Seller to accept
reassignment of the Receivables at the amount specified
below within 60 days of such notice (or within such
longer period as may be specified in such notice), and
the Seller shall be obligated to accept reassignment of
the Receivables within such applicable period on the
terms and conditions set forth below; provided, however,
that no such reassignment shall be required to be made
if, at any time during such applicable period, the Seller
delivers to the Buyer an Officer's Certificate stating
that the representations and warranties contained in
Section 4.1(a), (b), and (c) and 4.2(a)(i) and (ii) shall
then be true and correct in all material respects as if
made on such day. The Seller shall pay to the Buyer on
the day of such reassignment an amount equal to the
product of (i) the aggregate Invested Amount plus accrued
and unpaid interest on the Investor Certificates, and
(ii) a fraction, the numerator of which is the
outstanding balance of Principal Receivables sold by the
Seller to the Buyer hereunder, and the denominator of
which is the sum of the outstanding balance of Principal
Receivables sold by the Seller to the Buyer hereunder
plus the outstanding balance of Principal Receivables
sold by Fingerhut Corporation to the Buyer pursuant to
the receivables purchase agreement dated as of June 29,
1994 between the Buyer, as purchaser of such Receivables,
and Fingerhut, as seller of such Receivables, as amended
from time to time. On the day on which such amount has
been paid, each Receivable sold to the Buyer hereunder
shall be sold and reassigned to the Seller, and the Buyer
shall execute and deliver such instruments of sale and
assignment, in each case without recourse, representation
or warranty, as shall be reasonably requested by the
Seller to vest in the Seller, or its designee or
assignee, all right, title and interest of the Buyer in
and to each such Receivable. The obligation of the
Seller to purchase Receivables pursuant to this Section
shall constitute the sole remedy available to the Buyer
for a breach of the representations and warranties
contained in Section 4.1(a), (b), and (c) and 4.2(a)(i)
and (ii).
Section 6.2 Conveyance of Reassigned
Receivables. Upon the request of the Seller, the Buyer
shall execute and deliver to the Seller a reconveyance
substantially in such form and upon such terms as shall
be acceptable to the Seller, pursuant to which the Buyer
evidences the conveyance to the Seller of all of the
Buyer's right, title, and interest in any Receivables
reconveyed to the Seller pursuant to Section 6.1(b). The
Buyer shall (and shall cause the Trustee to) execute such
other documents or instruments of conveyance or take such
other actions as the Seller may reasonably require to
effect any repurchase of Receivables pursuant to this
Article VI.
[END OF ARTICLE VI]
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.1 Conditions to the Buyer's
Obligations Regarding Receivables. The obligations of
the Buyer to purchase the Receivables on any Business Day
shall be subject to the satisfaction of the following
conditions:
(a) All representations and warranties of the
Seller contained in this Agreement shall be true and
correct on the Initial Closing Date and on the day of
purchase of any Receivable purchased thereafter with the
same effect as though such representations and warranties
had been made on such date;
(b) All information concerning the Receivables
provided to the Buyer shall be true and correct in all
material respects as of the Initial Closing Date, in the
case of Receivables sold to the Buyer on the Initial
Closing Date, or the applicable Date of Processing, in
the case of Receivables created after the Initial Closing
Date;
(c) At the Initial Closing Date, the Seller
shall have substantially performed all other obligations
required to be performed by the provisions of this
Agreement;
(d) With respect to Receivables sold to the
Buyer on the Initial Closing Date, the Seller shall have
filed the financing statement(s) required to be filed
pursuant to Section 2.1(b); and
(e) 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 Buyer, and the Buyer shall have
received from the Seller copies of all documents
(including, without limitation, records of corporate
proceedings) relevant to the transactions herein
contemplated as the Buyer may reasonably have requested.
Section 7.2 Conditions Precedent to the
Seller's Obligations. The obligations of the Seller to
sell Receivables on any Business Day shall be subject to
the satisfaction of the following conditions:
(a) All representations and warranties of the
Buyer contained in this Agreement shall be true and
correct with the same effect as though such
representations and warranties had been made on such
date;
(b) Payment or provision for payment of the
Purchase Price in accordance with the provisions of
Section 3.3 hereof shall have been made; and
(c) 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 Buyer copies of all documents
(including, without limitation, records of corporate
proceedings) relevant to the transactions herein
contemplated as the Seller may reasonably have requested.
[END OF ARTICLE VII]
ARTICLE VIII
TERM AND TERMINATION
Section 8.1 Term. This Agreement shall
commence as of the date of execution and delivery hereof
and shall continue in full force and effect until the
earlier of: (a) unless otherwise agreed to in writing by
the Buyer and the Seller, the latest Series Termination
Date for any Series; or (b) the occurrence of any of the
following events: the Buyer or the Seller shall (i)
become insolvent, (ii) fail to pay its debts generally as
they become due, (iii) voluntarily seek, consent to, or
acquiesce in the benefit or benefits of any Debtor Relief
Law, (iv) become a party to (or be made the subject of)
any proceeding provided for by any Debtor Relief Law,
other than as a creditor or claimant, and, in the event
such proceeding is involuntary, the petition instituting
same is not dismissed within 60 days after its filing;
provided, however, that the Buyer shall have no duty to
continue to purchase Receivables from and after the
filing against the Seller of an involuntary petition but
prior to dismissal, or (v) become unable for any reason
to purchase or re-purchase Receivables in accordance with
the provisions of this Agreement or default in its
obligations hereunder, which default continues unremedied
for more than 30 days after written notice is delivered
to the defaulting party by the non-defaulting party (any
such date set forth in clause (a) or (b) hereof being a
"Termination Date"); provided, however, that the
termination of this Agreement pursuant to this subsection
8.1(b) hereof shall not discharge any Person from any
obligations incurred prior to such termination,
including, without limitation, any obligations to make
any payments with respect to, or repurchase, pursuant to
Section 6.1 hereof, Receivables sold prior to such
termination.
Section 8.2 Effect of Termination. No
termination or rejection of or failure to assume the
executory obligations of this Agreement in the event of
the bankruptcy of the Seller or the Buyer shall be deemed
to impair or affect the obligations pertaining to any
executed sale or executed obligations, including, without
limitation, pre-termination breaches of representations
and warranties by the Seller or the Buyer. Without
limiting the foregoing, prior to termination, the failure
of the Seller to deliver computer records of Receivables
or Settlement Statements shall not render such transfer
or obligation executory, nor shall the continued duties
of the parties pursuant to Section 5 or Section 9.1 of
this Agreement render an executed sale executory.
[END OF ARTICLE VIII]
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.1 Amendment. This Agreement and any
other Sale Papers and the rights and obligations of the
parties hereunder may not be changed orally, but only by
an instrument in writing signed by the Buyer and the
Seller. The Seller shall provide prompt written notice
of any such amendment to the Rating Agencies.
Section 9.2 Governing Law. THIS AGREEMENT AND
THE OTHER SALE PAPERS SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE
TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 9.3 Notices. All demands, notices and
communications hereunder shall be in writing and shall be
deemed to have been duly given if personally delivered at
or mailed by registered mail, return receipt requested,
to:
(a) in the case of the Buyer, to:
Fingerhut Receivables, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
(b) in the case of the Seller, to:
Fingerhut Companies, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
or, as to each party, at such other address as shall be
designated by such party in a written notice to each
other party.
Section 9.4 Severability of Provisions. If
any one or more of the covenants, agreements, provisions
or terms of the Sale Papers shall for any reason
whatsoever be held invalid, then such covenants,
agreements, provisions, or terms shall be deemed
severable from the remaining covenants, agreements,
provisions, or terms of the Sale Papers and shall in no
way affect the validity or enforceability of the other
provisions of the Sale Papers.
Section 9.5 Assignment. Notwithstanding
anything to the contrary contained herein, this Agreement
may not be assigned by the Buyer or the Seller except as
contemplated by this Section 9.5 and the Pooling and
Servicing Agreement; provided, however, that
simultaneously with the execution and delivery of this
Agreement, the Buyer shall assign all of its right, title
and interest herein to the Trustee for the benefit of the
Investor Certificateholders of all Series as provided in
Section 2.1 of the Pooling and Servicing Agreement, to
which the Seller hereby expressly consents; provided,
further, that except for the foregoing assignment, no
such assignment shall occur unless the Buyer shall have
received confirmation from the Rating Agencies that such
assignment shall not cause a reduction or withdrawal of
the rating of any Series of Certificates. The Seller
agrees to perform its obligations hereunder for the
benefit of the Trust and that the Trustee may enforce the
provisions of this Agreement, exercise the rights of the
Buyer and enforce the obligations of the Seller hereunder
without the consent of the Buyer.
Section 9.6 Further Assurances. The Buyer and
the Seller agree to do and perform, from time to time,
any and all acts and to execute any and all further
instruments required or reasonably requested by the other
party more fully to effect the purposes of the Sale
Papers, including, without limitation, the execution of
any financing statements or continuation statements or
equivalent documents relating to the Receivables for
filing under the provisions of the UCC or other laws of
any applicable jurisdiction.
Section 9.7 No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the
part of the Buyer or the Seller, any right, remedy, power
or privilege hereunder, shall operate as a waiver
thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any
other or further exercise thereof or the exercise of any
other right, remedy, power or privilege. The rights,
remedies, powers and privileges herein provided are
cumulative and not exhaustive of any rights, remedies,
powers and privilege provided by law.
Section 9.8 Counterparts. The Sale Papers may
be executed in two or more counterparts including telefax
transmission thereof (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 9.9 Binding Effect; Third-Party
Beneficiaries. The Sale Papers will inure to the benefit
of and be binding upon the parties hereto and their
respective successors and permitted assigns.
Section 9.10 Merger and Integration. Except
as specifically stated otherwise herein, the Sale Papers
set forth the entire understanding of the parties
relating to the subject matter hereof, and all prior
understandings, written or oral, are superseded by the
Sale Papers. The Sale Papers may not be modified,
amended, waived or supplemented except as provided
herein.
Section 9.11 Headings. The headings herein
are for purposes of reference only and shall not
otherwise affect the meaning or interpretation of any
provision hereof.
Section 9.12 Schedules and Exhibits. The
schedules and exhibits attached hereto and referred to
herein shall constitute a part of this Agreement and are
incorporated into this Agreement for all purposes.
Section 9.13 No Bankruptcy Petition Against
the Buyer. The Seller hereby covenants and agrees that,
prior to the date which is one year and one day after the
payment in full of all Invested Amounts, it will not
institute against or join any other Person in instituting
against the Buyer any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or
other similar proceeding under the laws of the United
States or any state of the United States.
Section 9.14 Merger or Consolidation of, or
Assumption of the Obligations of, the Seller. The Seller
shall not consolidate with or merge into any other
corporation or convey or transfer its properties and
assets substantially as an entirety to any Person,
unless:
(i) the corporation formed by such
consolidation or into which the Seller is merged or
the Person which acquires by conveyance or transfer
the properties and assets of the Seller
substantially as an entirety shall be a corporation
organized and existing under the laws of the United
States of America or any State or the District of
Columbia and, if the Seller is not the surviving
entity, shall expressly assume, by an agreement
supplemental hereto, executed and delivered to the
Buyer in form satisfactory to the Buyer, the
performance of every covenant and obligation of the
Seller hereunder (to the extent that any right,
covenant or obligation of the Seller, as applicable
hereunder, is inapplicable to the successor entity,
such successor entity shall be subject to such
covenant or obligation, or benefit from such right,
as would apply, to the extent practicable, to such
successor entity); and
(ii) the Seller shall have delivered to
the Buyer an Officer's Certificate that such
consolidation, merger, conveyance or transfer and
such supplemental agreement comply with this Section
9.14 and that all conditions precedent herein
provided for relating to such transaction have been
complied with and an Opinion of Counsel that such
supplemental agreement is legal, valid and binding
with respect to the successor entity and that the
entity surviving such consolidation, conveyance or
transfer is organized and existing under the laws of
the United States of America or any State or the
District of Columbia. The Rating Agencies shall
receive prompt written notice of such merger or
consolidation of the Seller.
Section 9.15 Protection of Right, Title and
Interest to Receivables.
(a) The Seller shall cause this Agreement, all
amendments hereto and/or all financing statements and
continuation statements and any other necessary documents
covering the Seller's and the Buyer's right, title and
interest to the Receivables to be promptly recorded,
registered and 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 Buyer
hereunder to the Receivables and proceeds thereof. The
Seller shall deliver to the Buyer file-stamped copies of,
or filing receipts for, any document recorded, registered
or filed as provided above, as soon as available
following such recording, registration or filing. The
Buyer 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 subsection 9.15(a).
(b) Within 30 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
materially misleading within the meaning of Section 9-
402(7) of the UCC as in effect in the Relevant UCC State,
the Seller shall give the Buyer written notice of any
such change and shall file such financing statements or
amendments as may be necessary to continue the perfection
of the Buyer's security interest in the Receivables and
the proceeds thereof.
(c) The Seller will give the Buyer prompt
written notice of any relocation of any office from which
it services Receivables or keeps records concerning the
Receivables or of its principal executive office and
whether, 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
and shall file such financing statements or amendments as
may be necessary to continue the perfection of the
Buyer's security interest in the Receivables and the
proceeds thereof. The Seller will at all times maintain
each office from which it services Receivables and its
principal executive office within the United States of
America.
[END OF ARTICLE IX]
IN WITNESS WHEREOF, the Buyer and the Seller
each have caused this Agreement to be duly executed by
their respective officers as of the day and year first
above written.
FINGERHUT RECEIVABLES, INC.,
as Buyer
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President,
Assistant Treasurer
FINGERHUT COMPANIES, INC.
as Seller
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President,
Treasurer
EXHIBIT A
FORM OF WEEKLY REPORT
SCHEDULE 1
Seller's Chief Executive Office:
Fingerhut Companies, Inc.
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▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
SCHEDULE 2
TAX RETURNS AND PAYMENTS
The Seller has filed all applicable Federal, state and
material local tax returns and has paid or caused to be
paid all associated taxes due and payable on such returns
or on any assessments received by them; except that the
Seller has not filed certain tax returns purported to be
required because the Seller believes the requirements are
invalid and unenforceable under the commerce clause of
the United States Constitution as interpreted by the
Supreme Court in National Bellas ▇▇▇▇ v. Department of
Revenue of Illinois, 386 U.S. 753 (1967) and the
supporting lines of cases, including Quill Corp. v. North
Dakota, 112 S. Ct. 1904 (1992). The following are the
states in which the Seller is currently collecting
sales/use taxes:
California Ohio
Florida Pennsylvania
Illinois South Carolina
Iowa South Dakota
Minnesota Tennessee
New York
Notwithstanding the Supreme Court decisions, the
following states, to the best knowledge of the Seller,
currently have legislation in effect which purports to
require certain Subsidiaries of the Seller to collect
sales or use taxes:
Alabama South Dakota
Arizona Tennessee
Arkansas Texas
California Utah
Colorado Vermont
Connecticut Virginia
Florida Washington
Georgia West ▇▇▇▇▇▇▇▇
Idaho
Illinois
Iowa
Kansas
Kentucky
Louisiana
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Nebraska
Nevada
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Pennsylvania
Rhode Island
South Carolina