SALE AND SERVICING AGREEMENT between NICE CARS FUNDING LLC, as Purchaser, and NICE CARS ACCEPTANCE ACQUISITIONCO, INC., as Seller, and MANCHESTER INC., as Servicer and NICE CARS OPERATIONS AQUISITIONCO., INC. Dated as of September 28, 2006
SALE
AND SERVICING
AGREEMENT
between
NICE
CARS FUNDING LLC,
as
Purchaser,
and
NICE
CARS ACCEPTANCE ACQUISITIONCO, INC.,
as
Seller,
and
as
Servicer
and
NICE
CARS OPERATIONS AQUISITIONCO., INC.
Dated
as
of
September
28, 2006
TABLE
OF CONTENTS
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Page
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ARTICLE
I DEFINITIONS
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1
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Section
1.1.
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Definitions
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1
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Section
1.2.
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Other
Definitional Provisions
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2
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ARTICLE
II CONVEYANCE OF RECEIVABLES
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2
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Section
2.1.
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Conveyance
of Receivables
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2
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Section
2.2.
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Payment
of Purchase Price
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5
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Section
2.3.
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Transfers
Intended as Sales
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5
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Section
2.4.
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Further
Encumbrance of Receivables and Other Conveyed Property
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5
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Section
2.5.
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Conveyance
of All Receivables
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6
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ARTICLE
III THE RECEIVABLES
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6
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Section
3.1.
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Representations
and Warranties of Seller
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6
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Section
3.2.
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Repurchase
upon Breach
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7
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Section
3.3.
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Custody
of Custodial Documents
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8
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ARTICLE
IV ADMINISTRATION AND SERVICING OF RECEIVABLES
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8
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Section
4.1.
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Duties
of Servicer
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8
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Section
4.2.
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Collection
of Receivable Payments; Modifications of Receivables; Blocked
Account
Agreement.
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9
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Section
4.3.
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Realization
Upon Receivables
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9
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Section
4.4.
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Insurance
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9
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Section
4.5.
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Maintenance
of Security Interests in Vehicles
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9
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Section
4.6.
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Additional
Covenants of Servicer
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10
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Section
4.7.
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Purchase
of Receivables Upon Breach of Covenant
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11
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Section
4.8.
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Servicing
Fee
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11
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Section
4.9.
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Reports
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11
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Section
4.10.
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Annual
Statement as to Compliance, Notice of Servicer Termination
Event
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12
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Section
4.11.
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Access
to Certain Documentation and Information Regarding
Receivables
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12
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Section
4.12.
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Retention
and Termination of Servicer
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12
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ARTICLE
V THE PURCHASER
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12
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Section
5.1.
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Representations
of Purchaser
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12
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ARTICLE
VI SELLER, SERVICER AND NCOC
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13
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Section
6.1.
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Representations
of Seller, Servicer and NCOC
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13
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Section
6.2.
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Additional
Covenants
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17
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Section
6.3.
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Liability
of Seller, Servicer and NCOC; Indemnities
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18
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Section
6.4.
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Delegation
of Duties
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19
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Section
6.5.
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Servicer
Not to Resign
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20
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-i-
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ARTICLE
VII SERVICER TERMINATION EVENTS
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20
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Section
7.1.
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Servicer
Termination Events
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20
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Section
7.2.
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Consequences
of a Servicer Termination Event
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21
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Section
7.3.
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Appointment
of Successor
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22
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Section
7.4.
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Waiver
of Past Defaults
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23
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ARTICLE
VIII MISCELLANEOUS
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23
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Section
8.1.
|
Notices
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23
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Section
8.2.
|
Notices
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23
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Section
8.3.
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Prior
Agreements Superseded
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23
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Section
8.4.
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Parties
Bound
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23
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Section
8.5.
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Execution
in Counterparts
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23
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Section
8.6.
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Severability
of Provisions
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24
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Section
8.7.
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Further
Instruments
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24
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Section
8.8.
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Governing
Law
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24
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Section
8.9.
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Consent
of Jurisdiction
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24
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Section
8.10.
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Waiver
of Jury Trial
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25
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Section
8.11.
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Pledge
by Purchaser
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25
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Section
8.12.
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Time
of Essence
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25
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ANNEXES
Annex
A - Defined
Terms
SCHEDULES
Schedule
A - Schedule
of Receivables
EXHIBITS
Exhibit
A - Form
of
Transfer Instrument
Exhibit
B - Form
of
Addition Notice
-ii-
SALE
AND
SERVICING AGREEMENT (this “Agreement”)
dated
as of September 28, 2006, among Nice Cars Funding LLC, a Delaware limited
liability company (the “Purchaser”),
Nice
Cars Acceptance AcquisitionCo, Inc. (“Seller”),
Manchester Inc., a Nevada corporation (“Servicer”),
and
Nice Cars Operations AcquisitionCo, Inc. a Delaware corporation (“NCOC”).
WHEREAS,
the Purchaser desires to purchase from Seller, from time to time, receivables
arising in connection with motor vehicle retail installment sale
contracts;
WHEREAS,
the Purchaser intends to finance such purchases by entering into the Loan
Agreement and issuing the Note, secured by, among other assets, the Receivables
and the Other Conveyed Property;
WHEREAS,
Seller is willing to sell such Receivables and the Other Conveyed Property
to
the Purchaser from time to time; and
WHEREAS
Servicer is willing to service all such Receivables on the terms of this
Agreement.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.1. Definitions.
Capitalized
terms used in this Agreement and not otherwise defined in this Agreement, shall
have the meanings set forth in Annex A attached hereto.
Section
1.2. Other
Definitional Provisions.
(a) All
terms
defined in this Agreement shall have the defined meanings when used in any
instrument governed hereby and in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(b) Accounting
terms used but not defined or partly defined in this Agreement, in any
instrument governed hereby or in any certificate or other document made or
delivered pursuant hereto, to the extent not defined, shall have the respective
meanings given to them under GAAP as in effect on the date of determination
or
any such instrument, certificate or other document, as applicable. To the extent
that the definitions of accounting terms in this Agreement or in any such
instrument, certificate or other document are inconsistent with the meanings
of
such terms under GAAP, the definitions contained in this Agreement or in any
such instrument, certificate or other document shall control.
(c) The
words
“hereof,”
“herein,”
“hereunder”
and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement.
-1-
(d) Section,
Schedule and Exhibit references contained in this Agreement are references
to
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term “including”
shall
mean “including
without limitation.”
(e) The
definitions contained in this Agreement are applicable to the singular as well
as the plural forms of such terms and to the masculine as well as to the
feminine and neuter genders of such terms.
Any
agreement, instrument or statute defined or referred to herein or in any
instrument or certificate delivered in connection herewith means such agreement,
instrument or statute as the same may from time to time be amended, modified
or
supplemented in accordance with the terms thereof and includes (in the case
of
agreements or instruments) references to all attachments and instruments
associated therewith; all references to a Person include its permitted
successors and assigns.
ARTICLE
II
CONVEYANCE
OF RECEIVABLES
Section
2.1. Conveyance
of Receivables.
(a) In
consideration of the Purchaser’s delivery to or upon the order of Seller on any
Funding Date of the Purchase Price therefor, Seller does hereby sell, transfer,
assign, set over and otherwise convey to the Purchaser, without recourse
(subject to the obligations set forth herein) all right, title and interest
of
Seller, whether now existing or hereafter arising, in, to and
under:
(i) the
Receivables listed in Schedule A to each Transfer Instrument executed and
delivered by Seller on such Funding Date;
(ii) all
monies received under the Receivables on and after the related Cutoff Date
and
all Net Liquidation Proceeds received with respect to the Receivables on and
after the related Cutoff Date;
(iii) the
security interests in the Financed Vehicles and any accessions thereto granted
by Obligors pursuant to the related Contracts and any other interest of Seller
in such Financed Vehicles, including, without limitation, the Auto
Title;
(iv) any
proceeds from claims on any Receivables Insurance Policies or certificates
relating to the Financed Vehicles securing the Receivables or the Obligors
thereunder;
(v) the
Custodial Documents related to each Receivable and all other documents that
Seller keeps on file in accordance with its customary procedures relating to
the
Receivables for Obligors of the Financed Vehicles;
-2-
(vi) all
amounts and property from time to time held in or credited to the Lockbox,
the
Collection Account or the Blocked Account;
(vii) all
property (including the right to receive future Net Liquidation Proceeds) that
secures a Receivable that has been acquired by or on behalf of Seller or the
Purchaser pursuant to a liquidation of such Receivable;
(viii) the
proceeds from any Servicer’s errors and omissions policy or fidelity bond, to
the extent such proceeds relate to any Receivable, Financed Vehicle or other
Collateral; and
(ix) all
present and future claims, demands, causes and choses in action in respect
of
any or all of the foregoing and all payments on or under and all proceeds of
every kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion, voluntary or involuntary, into cash
or
other liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, condemnation awards, rights to payment of any and every kind and
other
forms of obligations and receivables, instruments and other property which
at
any time constitute all or part of or are included in the proceeds of any of
the
foregoing.
(b) Seller
shall transfer to the Purchaser the Receivables and the Other Conveyed Property
described in paragraph
(a)
above
only upon the satisfaction of each of the conditions set forth below on or
prior
to the related Funding Date.
(i) Seller
shall have provided the Purchaser, Lender [and the Collateral Agent] with (A)
an
Addition Notice substantially in the form of Exhibit B
hereto
(which shall include a supplement to the Schedule of Receivables) and (B) a
data
tape or other electronic file containing information regarding the Related
Receivables that Lender may request hereto to be transferred on such Funding
Date (the “Data
Tape Fields”)
no
later than 11:00 a.m. (New York City time) three Business Days prior to such
Funding Date and shall have provided any information reasonably requested by
any
of the foregoing with respect to the Purchaser, Servicer and the Related
Receivables;
(ii) Seller
shall, to the extent required by Section
4.2
of this
Agreement, have deposited in the Blocked Account all collections received on
and
after the Cutoff Date in respect of the Related Receivables to be purchased
on
such Funding Date;
(iii) as
of
each Funding Date, (A) Seller shall not be insolvent and shall not become
insolvent as a result of the transfer of Related Receivables on such Funding
Date, (B) Seller shall not intend to incur or believe that it shall incur debts
that would be beyond its ability to pay as such debts mature, (C) such transfer
shall not have been made with actual intent to hinder, delay or defraud any
Person and (D) the assets of Seller shall not constitute unreasonably small
capital to carry out its business as then conducted;
-3-
(iv) the
Facility Termination Date shall not have occurred;
(v) each
of
the representations and warranties made by Seller pursuant to Section
3.1
and the
other Loan Documents with respect to the Related Receivables to be purchased
on
such Funding Date shall be true and correct as of the related Funding Date
and
Seller shall have performed all obligations to be performed by it hereunder
or
in any Transfer Instrument on or prior to such Funding Date;
(vi) Seller
shall, at its own expense, on or prior to the Funding Date, indicate in its
computer files that the Related Receivables to be purchased on such Funding
Date
have been sold to the Purchaser pursuant to this Agreement or a Transfer
Instrument, as applicable, and have been pledged by the Purchaser to the
Collateral Agent for the benefit of the Lender under the Loan
Agreement;
(vii) Seller
shall have taken all action required to maintain (i) the first priority
perfected ownership interest of the Purchaser in the Related Receivables and
Other Conveyed Property and (ii) the first priority perfected security interest
of the Collateral Agent for the benefit of the Lender in the
Collateral;
(viii) no
selection procedures adverse to the interests of Lender shall have been utilized
in selecting the Related Receivables to be sold on such Funding
Date;
(ix) the
addition of any such Related Receivables to be purchased on such Funding Date
shall not result in a material adverse tax consequence to any Secured
Party;
(x) Seller
shall have delivered to the Collateral Agent and Lender an Officers’ Certificate
confirming the satisfaction of each condition precedent specified in this
paragraph (b);
(xi) no
Servicer Termination Event, or any event that, with the giving of notice or
the
passage of time, would constitute a Servicer Termination Event, shall have
occurred and be continuing;
(xii) Seller
shall have delivered the related Custodial Documents to the Custodian, and
the
Custodian shall have confirmed receipt of the related Custodial Documents for
each Related Receivable and shall have delivered a copy to Lender and the
Collateral Agent of a Custodial Certification with respect to the Custodial
Documents related to the Related Receivables to be purchased on such Funding
Date;
(xiii) Seller
shall have filed or caused to be filed all necessary UCC-l financing statements
(or amendments thereto) necessary to maintain (in each case assuming for
purposes of this clause (xiii) that such perfection may be achieved by making
the appropriate filings), and taken any other steps necessary to maintain,
(1)
the first, priority, perfected ownership interest of Purchaser and (2) the
first
priority, perfected security interest of the Collateral Agent for the benefit
of
the Lender, with respect to the Related Receivables, the Other Conveyed Property
and any other Collateral to be transferred on such Funding Date;
-4-
(xiv) Seller
shall have executed and delivered an Transfer Instrument in the form of
Exhibit
A
with
respect to such Related Receivables and the Other Conveyed Property related
thereto; and
(xv) the
Funding Date shall not occur in the same calendar week as any prior Funding
Date.
Section
2.2. Payment
of Purchase Price.
In
consideration for the sale of the Related Receivables and Other Conveyed
Property described in Section
2.1(a)
or the
related Transfer Instrument, the Purchaser shall, on each Funding Date on which
Related Receivables are transferred hereunder, pay to or upon the order of
Seller the applicable Purchase Price in the following manner: (i) cash in an
amount equal to the amount of the Advance received by the Purchaser under the
Loan Agreement on such Funding Date and (ii) to the extent the Purchase Price
for the related Receivables and Other Conveyed Property exceeds the amount
of
cash described in (i), such excess shall be treated as a capital contribution
by
Seller to the Purchaser.
Section
2.3. Transfers
Intended as Sales. It
is the
intention of Seller and the Purchaser that each transfer and assignment
contemplated by this Agreement and each Transfer Instrument shall constitute
a
sale of the Related Receivables and Other Conveyed Property from Seller to
the
Purchaser free and clear of all liens and rights of others and it is intended
that the beneficial interest in and title to the Related Receivables and Other
Conveyed Property shall not be part of Seller’s estate in the event of the
filing of a bankruptcy petition by or against Seller under any bankruptcy law.
In the event that, notwithstanding the intent of Seller and the Purchaser,
the
transfer and assignment contemplated hereby or by any Transfer Instrument is
held not to be a sale, this Agreement and each Transfer Instrument shall
constitute a security agreement under applicable law and Seller hereby grants
to
the Purchaser a security interest in the Receivables and Other Conveyed
Property, which security interest has been assigned to the Collateral Agent
for
the benefit of the Lender.
Section
2.4. Further
Encumbrance of Receivables and Other Conveyed Property.
(a) Immediately
upon the conveyance to the Purchaser by Seller of the Related Receivables and
any item of the related Other Conveyed Property pursuant to Section
2.1
and the
related Transfer Instrument, all right, title and interest of Seller in and
to
such Related Receivables and Other Conveyed Property shall terminate, and all
such right, title and interest shall vest in the Purchaser.
(b) Immediately
upon the vesting of any Related Receivables and the related Other Conveyed
Property in the Purchaser, the Purchaser shall have the sole right to pledge
or
otherwise encumber such Related Receivables and the related Other Conveyed
Property. Pursuant to the Loan Agreement, the Purchaser shall grant a security
interest in the Collateral to secure the repayment of the Loan and the other
Secured Obligations.
-5-
Section
2.5. Conveyance
of All Receivables.
Seller
covenants, represents and warrants that (i) on the date of the first sale
hereunder it will sell to the Purchaser pursuant to this Agreement all
Receivables (including all Receivables which are Eligible Receivables and all
Receivables which are not Eligible Receivables) owned by it on such date and
(ii) thereafter it will sell to the Purchaser pursuant to this Agreement all
such Receivables that it purchases or originates within one week of such
purchase or origination.
ARTICLE
III
THE
RECEIVABLES
Section
3.1. Representations
and Warranties of Seller.
(a) Seller
makes the following representations and warranties as to the Receivables to
the
Purchaser, on which the Purchaser relies in acquiring the Receivables, and
on
which Lender will rely in making the Advances to the Purchaser pursuant to
the
Loan Agreement. Such representations and warranties speak as of the Closing
Date
and as of each Funding Date; provided
that to
the extent such representations and warranties relate to the Receivables
conveyed on any Funding Date, such representations and warranties shall speak
as
of the related Funding Date, but shall survive the sale, transfer and assignment
of the Receivables to the Purchaser and the pledge thereof by the Purchaser
to
the Collateral Agent for the benefit of the Lender pursuant to the Loan
Agreement.
(b) Characteristics
of Receivables.
(i) Each
Receivable indicated in the Addition Notice to be an Eligible Receivable is
an
Eligible Receivable,
(ii) Each
Receivable is genuine, is in all respects what it purports to be and the
Contract evidencing such Receivable has only one original counterpart and,
if
evidenced by an instrument, includes only one original promissory note which
constitutes an instrument under the UCC and no Person other than Lender or
the
Custodian is in actual or constructive possession of any such original Contract
or Auto Title;
(iii) The
Receivables represent undisputed, bona fide transactions completed in accordance
with the terms and provisions contained in any documents related
thereto;
(iv) The
amounts of the face value shown on any schedule of Receivables provided to
Borrower, Lender or Custodian, and/or all invoices or statements delivered
to
Borrower, Lender or Custodian with respect to any Receivables, are actually
and
absolutely owing to Seller and are not contingent for any reason;
-6-
(c) No
set-offs, counterclaims or disputes as to payments or liability thereon exist
or
have been asserted with respect thereto and neither Seller nor any Related
Party
has made any agreement with any Obligor thereunder for any deduction therefrom,
except a discount or allowance allowed by Seller or Servicer in the ordinary
course of business for prompt payment, all of which discounts or allowances
are
reflected in the calculation of the outstanding amount of such
Receivable;
(d) No
facts,
events or occurrences exist that, in any way, impair the validity or enforcement
thereof or tend to reduce the amount payable thereunder from the amount of
the
Receivable shown on any schedule, or on all contracts, invoices or statements
delivered to Lender or the Custodian with respect thereto;
(e) All
Obligors in connection with Receivables: (i) had the capacity to contract at
the
time any contract or other document giving rise to the Receivable was executed;
and (ii) generally have the ability to pay their debts as they become
due;
(f) To
Seller’s knowledge, no proceedings or actions are threatened or pending against
any Obligor that might result in any material adverse effect in the Obligor’s
financial condition;
(g) The
Receivables have not been assigned or pledged to any Person other than as
permitted pursuant to the Loan Documents;
(h) The
goods
giving rise to the Receivables are not, and were not at the time of the sale,
rental and/or lease thereof, subject to any Lien, except those of the Collateral
Agent for the benefit of the Lender, or those removed or terminated prior to
the
date hereof;
(i) The
Delinquency set forth in the Availability Report shall be delivered to Lender
by
Servicer on behalf of Borrower under the Loan Agreement as determined pursuant
to the Aging Procedures and Eligibility Test.
(j) All
Contracts represent the legal, valid and binding payment obligation of the
applicable Obligors, enforceable in accordance with their terms, subject to
bankruptcy, insolvency and other Laws (including, but not limited to principles
of equity) affecting the rights of creditors.
(k) No
instrument of release or waiver has been executed in connection with any
Contract, and no Obligor has been released from its obligations thereunder,
in
whole or in part, and no action has been taken by Seller or any Related Party
to
release any collateral under any Contract.
Section
3.2. Repurchase
upon Breach.
Seller
or, Servicer, as the case may be, shall inform the other parties to this
Agreement promptly, in writing, upon the discovery of any breach of Seller’s
representations and warranties made pursuant to Section 3.1
with
respect to a Receivable (without regard to any limitations therein as to
Seller’s knowledge). Unless the breach shall have been cured within thirty (30)
days of the breach, Seller shall repurchase such Receivable. In consideration
of
the repurchase of any Receivable, Seller shall remit the Purchase Amount to
the
Collection Account on the date of such repurchase. Upon receipt of the Purchase
Amount in respect of any Defective Receivables and written instructions from
Servicer, the Custodian shall release to Seller or its designee the related
Custodial Documents and the Purchaser shall execute and deliver all reasonable
instruments of transfer or assignment, without recourse, as are prepared by
Seller and delivered to the Purchaser and necessary to vest in Seller or such
designee title to such Defective Receivables. The parties hereto hereby
acknowledge that the Collateral Agent for the benefit of the Lender shall have
the right to enforce directly against Seller Seller’s repurchase and indemnity
obligations pursuant to this Section
3.2.
-7-
Section
3.3. Custody
of Custodial Documents.
In
connection with each sale, transfer and assignment of Receivables and related
Other Conveyed Property to the Purchaser pursuant to this Agreement and each
Transfer Instrument, and each pledge thereof by the Purchaser to Lender pursuant
to the Loan Agreement, the Custodian shall act as custodian of the related
Custodial Documents and any other documents or instruments delivered to the
Custodian pursuant to the Custodian Agreement.
ARTICLE
IV
ADMINISTRATION
AND SERVICING OF RECEIVABLES
Section
4.1. Duties
of Servicer.
Servicer,
as agent for the Purchaser and the Lender, shall manage, service, administer
and
make collections on the Receivables with reasonable care, using that degree
of
skill and attention customary and usual for institutions which service motor
vehicle retail installment sale contracts and other auto loans similar to the
Receivables and, to the extent more exacting, that Servicer exercises with
respect to all comparable automotive receivables that it or any of its
Affiliates services for itself, theirselves or others. In performing such
duties, Servicer shall comply with the Servicing Guidelines and the Credit
and
Collection Policy. Without limiting the generality of the foregoing, and subject
to the servicing standards set forth in this Agreement including, without
limitation, the restrictions set forth in Section
4.6,
Servicer is authorized and empowered by the Purchaser to execute and deliver,
on
behalf of itself, the Purchaser, the Lender, or the Collateral Agent for the
benefit of the Lender, any and all instruments of satisfaction or cancellation,
or partial or full release or discharge, and all other comparable instruments,
with respect to such Receivables or to the Financed Vehicles securing such
Receivables and/or the Auto Title. If Servicer shall commence a legal proceeding
to enforce a Receivable, the Purchaser shall thereupon be deemed to have
automatically assigned, solely for the purpose of collection, such Receivable
to
Servicer. If in any enforcement suit or legal proceeding it shall be held that
Servicer may not enforce a Receivable on the ground that it shall not be a
real
party in interest or a holder entitled to enforce such Receivable, the Purchaser
shall, at Servicer’s expense and direction, take steps to enforce such
Receivable, including bringing suit in its name or the name of the Collateral
Agent for the benefit of the Lender. Without limiting any of the Servicer’s
duties and obligations hereunder, Servicer shall perform on behalf of Borrower
the affirmation obligations of Borrower under Sections 3.3., 3.7, 3.8, 3.9
and
3.10 of the Loan Agreement, and shall perform the Auto Title Procedures on
behalf of the Borrower.
-8-
Section
4.2. Collection
of Receivable Payments; Modifications of Receivables; Blocked Account
Agreement.
(a) Consistent
with the standards, policies and procedures required by this Agreement, Servicer
shall make reasonable efforts to collect all payments called for under the
terms
and provisions of the Receivables as and when the same shall become due and
shall follow such collection procedures as it follows with respect to all
comparable automotive receivables that it services for itself or others.
Servicer, for so long as Manchester is Servicer, may in accordance with
Servicer’s Servicing Guidelines grant extensions on a Receivable; provided,
however,
that
Servicer may not grant more than one (1) extension per calendar year with
respect to a Receivable or grant an extension with respect to a Receivable
for
more than one (1) calendar month or grant more than four (4) extensions in
the
aggregate with respect to a Receivable without the prior written consent of
the
Lender. If Servicer is not Manchester, Servicer may not make any extension
on a
Receivable without the prior written consent of the Lender. Notwithstanding
anything to the contrary contained herein, Servicer shall not agree to any
alteration of the interest rate on any Receivable or of the amount of any
Scheduled Receivable Payment on Receivables, other than to the extent that
such
alteration is required by applicable law.
(b) Servicer
shall remit all payments by or on behalf of the Obligors received by Servicer
with respect to the Receivables (other than Purchased Receivables) and all
Net
Liquidation Proceeds into the Blocked Account or the Collection Account on
the
date of receipt thereof, or, if not a Business Day, on the next following
Business Day. Servicer shall not commingle its assets and funds with those
on
deposit in the Blocked Account or the Collection Account.
Section
4.3. Realization
Upon Receivables.
On
behalf
of the Purchaser and the Collateral Agent for the benefit of the Lender,
Servicer shall use its best efforts, consistent with the servicing procedures
set forth herein, to repossess or otherwise convert the ownership of the
Financed Vehicle securing any Receivable as to which Servicer shall have
determined eventual payment in full is unlikely.
Section
4.4. Insurance.
Servicer,
in accordance with the servicing procedures and standards set forth herein,
shall require that each Obligor shall have obtained any insurance required
by
the related Contract (each, a “Receivables
Insurance Policy”).
Section
4.5. Maintenance
of Security Interests in Vehicles.
(a) Consistent
with the policies and procedures required by this Agreement, Servicer shall
take
such steps on behalf of the Purchaser and the Collateral Agent for the benefit
of the Lender as are necessary to maintain perfection of the security interest
created by each Receivable in the related Financed Vehicle.
(b) Upon
the
occurrence and continuance of a Servicer Termination Event, the Collateral
Agent
for the benefit of the Lender and Servicer shall take or cause to be taken
such
action as may, in the opinion to the Lender or the Collateral Agent for the
benefit of the Lender, be necessary to perfect or re-perfect the security
interests in the Financed Vehicles securing the Receivables in the name of
the
Collateral Agent for the benefit of the Lender by amending the title documents
of such Financed Vehicles or by such other reasonable means as may, in the
opinion of the Lender or the Collateral Agent for the benefit of the Lender,
be
necessary or prudent.
-9-
(c) Servicer
hereby agrees to pay all expenses related to such perfection or re-perfection
in
accordance with clauses (a) and (b) above and to take all action necessary
therefor. In addition, Lender may instruct Servicer to take or cause to be
taken, and Servicer shall take or cause to be taken, such action as may, in
the
judgment of Lender be necessary to perfect or re-perfect the security interest
in the Financed Vehicles underlying the Receivables in the name of the
Collateral Agent for the benefit of the Lender including by amending the title
documents of such Financed Vehicles or by such other reasonable means as may,
in
the judgment of the Lender, be necessary or prudent.
Section
4.6. Additional
Covenants of Servicer.
(a) Servicer
shall not release the Financed Vehicle securing any Receivable from the security
interest granted by such Receivable in whole or in part except in the event
of
payment in full by the Obligor thereunder or repossession or other liquidation
of the Financed Vehicle, nor shall Servicer impair the rights of the Collateral
Agent for the benefit of the Lender in such Receivables, nor shall Servicer
amend or otherwise modify a Receivable, except as permitted in accordance with
Section
4.2.
(b) Servicer
shall reimburse the Secured Parties for any and all fees or expenses that the
Secured Parties pay to a bank arising out of a return of payments in respect
of
the Receivables.
(c) Servicer
will not (i) create, incur or suffer to exist, or agree to create, incur or
suffer to exist, or consent to cause or permit in the future (upon the happening
of a contingency or otherwise) the creation, incurrence or existence of any
lien, security interest, charge, pledge, equity, encumbrance or restriction
on
transferability of the Receivables and the Other Conveyed Property except (x)
for the lien in favor of the Collateral Agent for the benefit of the Lender
and
the restrictions on transferability imposed by this Agreement or any other
Loan
Document or (y) with respect to any portion of the Receivables and the Other
Conveyed Property released in a manner permitted by the Loan Documents from
the
lien in favor of the Collateral Agent for the benefit of the Lender, or (ii)
sign or file under the UCC of any jurisdiction any financing statement which
names Seller, Servicer or the Purchaser as a debtor, or sign any security
agreement authorizing any secured party thereunder to file such financing
statement, with respect to the Receivables and Other Conveyed Property, except
in each case any such instrument solely securing the rights and preserving
the
lien of the Collateral Agent for the benefit of the Lender.
(d) Servicer
shall maintain (i) a modern system of accounting in accordance with GAAP or
other systems of accounting acceptable to Lender and (ii) standard operating
procedures applicable to all of their locations with respect to the handling
and
disposition of cash receipts and other proceeds of Collateral on a daily basis,
including the depositing thereof, aging of account receivables, record keeping
and such other matters as Lender may reasonably request. For the purpose of
determining compliance with the covenants and representations in the Loan
Documents, Lender shall have the right to recast any financial statement or
report presented to Lender by or on behalf of any Related Party to comply with
GAAP.
-10-
(e) Servicer
agrees to furnish to Lender from time to time, promptly upon request, a list
of
all Obligors’ names and their most current addresses. Servicer agrees that
Lender may from time to time, consistent with standard or generally accepted
auditing practices, verify the validity, amount and any other matters relating
to the Receivables by means of mail, telephone or otherwise, in the name of
Servicer or Borrower and upon the occurrence of an Event of Default in the
name
of Lender or such other name as Lender may choose.
Section
4.7. Purchase
of Receivables Upon Breach of Covenant.
Upon
discovery by any of Servicer, Seller, the Purchaser of a breach of any of the
covenants of Servicer set forth in Section 4.2(a),
4.4,
4.5
or
4.6,
the
party discovering such breach shall give prompt written notice to the others;
provided,
however,
that
the failure to give any such notice shall not affect any obligation of Servicer
under this Section 4.7.
Unless
the breach shall have been cured within 30 days following such discovery,
Servicer shall purchase any Receivable materially and adversely affected by
such
breach. In consideration of the purchase of such Receivable, Servicer shall
remit the Purchase Amount for such Receivable to the Collection Account on
the
date of such purchase. Servicer shall indemnify the Secured Parties, and the
Purchaser against all costs, expenses, losses, damages, claims and liabilities,
including reasonable fees and expenses of counsel, which may be asserted against
or incurred by any of them as a result of third party claims arising out of
the
events or facts giving rise to such breach.
Section
4.8. Servicing
Fee.
The
“Servicing
Fee”
for
each Settlement Date shall be equal to 4% of the average daily Net Pool Balance
(as defined in the Fee Letter) of the Receivables per annum.
Section
4.9. Reports.
(a) No
later
than 12:00 noon New York City time on each Determination Date and on each Monday
(or, if not a Business Day, on the next following Business Day), Servicer shall
deliver (in computer-readable format reasonably acceptable to each such Person
to the Lender, the Collateral Agent and the Purchaser, a report containing
the
information specified in Exhibit B to the Loan Agreement. Within two business
days of receipt, the Lender will notify the Servicer of any deficiencies in
any
report. If no notification is made, the report will be deemed accepted but,
notwithstanding the foregoing, if deficiencies or errors are later discovered,
the Servicer will work in good faith with the Lender to correct the
report.
(b) No
later
than 12:00 noon New York City time on each Determination Date, Servicer shall
deliver (in computer-readable format reasonably acceptable to Lender) a 13-week
cash-flow report containing such information as Lender shall request from
Servicer.
-11-
Section
4.10. Annual
Statement as to Compliance, Notice of Servicer Termination Event.
Servicer
shall deliver to the Purchaser and to the Lender, on or before March 31 of
each
year beginning 2007, an Officer’s Certificate, dated as of December 31 of the
preceding year, stating that (i) a review of the activities of Servicer during
the preceding 12-month period (or, in the case of the first such certificate,
the period from the initial Cutoff Date to December 31, 2006) and of its
performance under this Agreement has been made under such officer’s supervision
and (ii) to the best of such officer’s knowledge, based on such review, Servicer
has fulfilled all its obligations under this Agreement throughout such year
(or,
in the case of the first such certificate, such shorter period), or, if there
has been a default in the fulfillment of any such obligation, specifying each
such default known to such officer and the nature and status
thereof.
Section
4.11. Access
to Certain Documentation and Information Regarding Receivables.
Servicer
shall provide to representatives of the Secured Parties, full and unrestricted
access to the documentation regarding the Receivables. Nothing in this Section
shall derogate from the obligation of Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors, and the failure
of
Servicer to provide access as provided in this Section as a result of such
obligation shall not constitute a breach of this Section.
Section
4.12. Retention
and Termination of Servicer.
Servicer
hereby covenants and agrees to act as such under this Agreement for an initial
term commencing on the Closing Date and ending on the Maturity Date unless
terminated in accordance with the Loan Documents.
ARTICLE
V
THE
PURCHASER
Section
5.1. Representations
of Purchaser.
The
Purchaser hereby continuously represents and warrants that, during the term
of
this Agreement and so long as the Loan remains outstanding:
(a) The
Purchaser is a limited liability company duly formed, validly existing and
in
good standing under the laws of the State of Delaware, is duly qualified to
do
business and is in good standing as a foreign limited liability company in
all
states where such qualification is required, has all necessary limited liability
company power and authority to enter into this Agreement and each of the other
Loan Documents to which it is a party and to perform all of its obligations
hereunder and thereunder.
(b) The
Purchaser has all requisite right and power and is duly authorized and empowered
to enter into, execute, deliver and perform this Agreement and each other Loan
Document to which it is a party and this Agreement and each other Loan Document
to which the Purchaser is a party are the legal, valid and binding obligations
of the Purchaser and are enforceable against the Purchaser in accordance with
their terms.
(c) The
execution, delivery and performance by the Purchaser of this Agreement and
each
of the Loan Documents to which it is a party does not and shall not (i) violate
any provision of any Law, order, writ, judgment, injunction, decree,
determination or award presently in effect having applicability to the
Purchaser; (ii) violate any provision of its charter documents, bylaws, limited
liability company agreement, operating agreement or partnership agreement,
as
applicable; or (iii) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other agreement, lease or
instrument to which the Purchaser is a party or by which it or any of its assets
or properties may be bound or affected; and the Purchaser is not in default
of
any such Law, order, writ, judgment, injunction, decree, determination or award
or any such indenture, agreement, lease or instrument.
-12-
(d) No
consent, approval, license, exemption of or filing or registration with, giving
of notice to, or other authorization of or by, any court, administrative agency
or other governmental authority is or shall be required in connection with
the
execution, delivery or performance by the Purchaser of this Agreement and each
other Loan Document for the valid consummation of the transactions contemplated
hereby or thereby.
(e) No
event
has occurred and is continuing which constitutes a Default or an Event of
Default. There is no action, suit, proceeding or investigation pending or
threatened against or affecting the Purchaser before or by any court,
administrative agency or other governmental authority that brings into question
the validity of the transactions contemplated hereby, or that might result
in
any Material Adverse Effect.
(f) The
Purchaser is solvent, generally able to pay its obligations as they become
due,
has sufficient capital to carry on its business and transactions and all
businesses and transactions in which it intends to engage, and the current
value
of the Purchaser’s assets, at fair saleable valuation, exceeds the sum of its
liabilities. The Purchaser shall not be rendered insolvent by the execution
and
delivery of this Agreement and the other Loan Documents and the consummation
of
the transactions contemplated hereby and thereby and the capital remaining
in
the Purchaser is not now and shall not foreseeably become unreasonably small
to
permit the Purchaser to carry on its business and transactions and all
businesses and transactions in which it is about to engage. The Purchaser does
not intend to, nor does it reasonably believe it shall, incur debts beyond
its
ability to repay the same as they mature.
ARTICLE
VI
SELLER,
SERVICER AND NCOC
Section
6.1. Representations
of Seller, Servicer and NCOC.
Each
of
Seller, Servicer and NCOC hereby jointly and severally and continuously
represent and warrant that, during the term of this Agreement and so long as
any
Loan remains outstanding under the Loan Agreement:
(a) Each
of
Seller, Servicer and NCOC is a corporation duly formed, validly existing and
in
good standing under the laws of its state of incorporation, is duly qualified
to
do business and is in good standing as a foreign corporation in all states
where
such qualification is required, has all necessary corporate power and authority
to enter into this Agreement and each other Loan Document to which it is a
party
and to perform all of its obligations hereunder and thereunder.
-13-
(b) Each
of
Seller, Servicer and NCOC operates its business only under the assumed names
listed on Schedule 5.1(b) of Schedule A attached to the Loan
Agreement.
(c) Each
of
Seller, Servicer and NCOC has all requisite right and power and is duly
authorized and empowered to enter into, execute, deliver and perform this
Agreement and each other Loan Document to which it is a party and this Agreement
and each other Loan Document to which Seller, Servicer and NCOC is a party
are
the legal, valid and binding obligations of Seller, Servicer or NCOC, as
applicable, and are enforceable against such Person in accordance with their
terms.
(d) The
execution, delivery and performance by each of Seller, Servicer and NCOC of
this
Agreement and each other Loan Document to which it is a party does not and
shall
not (i) violate any provision of any Law, order, writ, judgment, injunction,
decree, determination or award presently in effect having applicability to
such
Person; (ii) violate any provision of its charter documents, bylaws, limited
liability company agreement, operating agreement or partnership agreement,
as
applicable; or (iii) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other agreement, lease or
instrument to which such Person is a party or by which it or any of its assets
or properties may be bound or affected; and none of Seller, Servicer or NCOC
is
in default of any such Law, order, writ, judgment, injunction, decree,
determination or award or any such indenture, agreement, lease or
instrument.
(e) No
consent, approval, license, exemption of or filing or registration with, giving
of notice to, or other authorization of or by, any court, administrative agency
or other governmental authority is or shall be required in connection with
the
execution, delivery or performance by Seller, Servicer or NCOC, of this
Agreement and each of the Loan Document to which it is a party for the valid
consummation of the transactions contemplated hereby or thereby.
(f) No
event
has occurred and is continuing which constitutes a Default, Event of Default,
a
Seller Default or a Servicer Termination Event. There is no action, suit,
proceeding or investigation pending or threatened against or affecting Seller,
Servicer or NCOC, before or by any court, administrative agency or other
governmental authority that brings into question the validity of the
transactions contemplated hereby or by the other Loan Documents, or that might
result in any Material Adverse Effect.
(g) None
of
Seller, Servicer or NCOC is in default in the payment of any taxes levied or
assessed against it or any of its assets or properties, except for taxes being
contested in good faith and by appropriate proceedings and for which adequate
reserves have been established.
(h) Each
of
Seller, Servicer and NCOC has good and marketable title to its assets and
properties as reflected in its financial statements furnished to Purchaser
or
Lender.
-14-
(i) Each
of
the financial statements furnished to Purchaser or Lender by Seller, Servicer
or
NCOC was prepared in accordance with GAAP and fairly and accurately reflects
their financial condition as of the date thereof; and Seller, Servicer and
NCOC
hereby certify that there have been no Material Adverse Effects, since the
date
of such statements, and there are no known contingent liabilities not provided
for or disclosed in such statements.
(j) Neither
this Agreement, any Availability Report or any statement or document referred
to
herein or delivered to Lender, the Collateral Agent, the Custodian or the
Purchaser by any of Seller, Servicer or NCOC contains any untrue statement
of a
material fact or omits to state a material fact necessary to make the statements
made herein or therein not misleading.
(k) Seller
has good, indefeasible and merchantable title to and ownership of the
Collateral, free and clear of all Liens, except those of the Collateral Agent
for the benefit of the Lender.
(l) All
books, records and documents relating to the Collateral are and shall be genuine
and in all respects what they purport to be; the original amount and the unpaid
balance of each Receivable shown on the books and records of Seller or the
Servicer and in the schedules represented as owing by each Obligor is and shall
be the correct amount actually owing or to be owing by such Obligor at maturity;
each Obligor liable upon the Receivables has and shall have capacity to
contract; none of Seller, Servicer or NCOC has knowledge of any fact which
would
impair the validity or collectibility of any of the Receivables; and the
payments shown to have been made by each Obligor on the books and records of
Seller reflects the amounts of and dates on which said payments were actually
made.
(m) Each
place of business of each of Seller, Servicer or NCOC is only at the locations
set forth in Section 5.1(n) of Schedule A of the Loan Agreement. None of Seller,
Servicer or NCOC shall begin or do business (either directly or through
subsidiaries) at other locations or cease to do business at any of the above
locations or at Purchaser’s principal place of business without first notifying
Lender.
(n) The
present value of all benefits vested under all Plans of Seller, Servicer and
NCOC or any Commonly Controlled Entity (based on the assumptions used to fund
the Plans) did not, as of the last annual valuation date (which in case of
any
Plan was not earlier than December 31, 1982) exceed the value of the assets
of
the Plans applicable to such vested benefits.
(o) The
liability to which any of Seller, Servicer, NCOC or any Commonly Controlled
Entity would become subject under Sections 4063 or 4064 of ERISA if such Person
or any Commonly Controlled Entity were to withdraw from all Multi-employer
Plans
or if such Multi- employer Plans were to be terminated as of the valuation
date
most closely preceding the date hereof, is not in excess of One Thousand Dollars
($1,000.00);
-15-
(p) None
of
Seller, Servicer or NCOC is engaged nor shall it engage, principally or as
one
of its important activities, in a business of extending credit for the purpose
of “purchasing” or “carrying” any “margin stock” within the respective meanings
of each of the quoted terms under Regulations G or X of the Board of Governors
of the Federal Reserve System as now and from time to time hereafter in effect.
No part of the proceeds of any advances hereunder shall be used for “purchasing”
or “carrying” “margin stock” as so defined or for any purpose which violates, or
which would be inconsistent with, the provisions of the Regulations of such
Board of Governors. If requested by Lender, Seller and Servicer shall furnish
to
Lender a statement in conformity with the requirement of Federal Reserve Form
G-3 referred to in said Regulation G to the foregoing effect. All of the
outstanding securities of each of Seller, Servicer and NCOC have been offered,
issued, sold and delivered in compliance with, or are exempt from, all federal
and state laws and rules and regulations of federal and state regulatory bodies
governing the offering, issuance, sale and delivery of securities.
(q) None
of
Seller, Servicer or NCOC is an “investment company” or a company “controlled” by
an “investment company,” within the meaning of the Investment Company Act of
1940, as amended.
(r) To
the
best knowledge of each of Seller, Servicer and NCOC, the land and improvements
owned or leased by each of Seller, Servicer and NCOC for use in their business
operations (including the locations listed in Section 5.1(n) of Schedule (A)
of
the Loan Agreement are free of dangerous levels of contaminates, oils, asbestos,
radon, PCB’s, hazardous substances or waste as defined by federal, state or
local environmental laws, regulations or administrative orders or other
materials, the removal of which is required or the maintenance of which is
prohibited, regulated or penalized by any federal, state or local governmental
authority.
(s) Each
of
Seller, Servicer and NCOC is solvent, generally able to pay its obligations
as
they become due, has sufficient capital to carry on its business and
transactions and all businesses and transactions in which it intends to engage,
and the current value of such Person’s assets, at fair saleable valuation,
exceeds the sum of its liabilities. Each of Seller, Servicer and NCOC shall
not
be rendered insolvent by the execution and delivery of this Agreement and the
other Loan Documents and the consummation of the transactions contemplated
hereby and thereby and the capital remaining in such Person is not now and
shall
not foreseeably become unreasonably small to permit such Person to carry on
its
business and transactions and all businesses and transactions in which it is
about to engage. Each of Seller, Servicer and NCOC does not intend to, nor
does
it reasonably believe it shall, incur debts beyond its ability to repay the
same
as they mature.
(t) There
are
no material actions, suits or proceedings pending, or threatened against or
affecting the assets of any Seller, Servicer or NCOC, or the consummation of
the
transactions contemplated hereby or by the other Loan Documents, at law, or
in
equity, or before or by any governmental authority or instrumentality or before
any arbitrator of any kind. None of Seller, Servicer or NCOC is subject to
any
judgment, order, writ, injunction or decree of any court or governmental agency.
There is not a reasonable likelihood of an adverse determination of any pending
proceeding which would, individually or in the aggregate, have a Material
Adverse Effect.
-16-
(u) Section
5.1(x) of Schedule A attached to the Loan Agreement correctly and completely
sets forth for each of Seller, Servicer and NCOC, (i) its full legal name and
state of organization, (ii) its Federal Tax Identification Number; (iii) its
chief executive office, (iv) all prior names used in the last five (5) years
(including, without limitation, Seller, Servicer’s or NCOC’s predecessors in
interest as a result of a merger or consolidation) and (v) the charter or other
similar number for such of Seller, Servicer or NCOC in its state of
organization.
(v) None
of
Seller, Servicer or NCOC (i) is a person whose property or interest in property
is blocked or subject to blocking pursuant to Section 1 of Executive Order
13224
of September 23, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg.
49079
(2001)), (ii) engages in any dealings or transactions prohibited by Section
2 of
such executive order, or is otherwise associated with any such person in any
manner violative of Section 2, or (iii) is a Person on the list of Specially
Designated Nationals and Blocked Persons or subject to the limitations or
prohibitions under any other U.S. Department of Treasury’s Office of Foreign
Assets Control regulation or executive order.
(w) Each
of
Seller, Servicer and NCOC is in compliance with the Patriot Act. No part of
the
proceeds received under any Loan Documents will be used, directly or indirectly,
for any payments to any governmental official or employee, political party,
official of a political party, candidate for political office, or anyone else
acting in an official capacity, in order to obtain, retain or direct business
or
obtain any improper advantage, in violation of the United States Foreign Corrupt
Practices Act of 1977, as amended.
Section
6.2. Additional
Covenants.
(a) Sale.
Seller
agrees to treat the conveyances hereunder as financings for tax and accounting
purposes and as sales for all other purposes (including without limitation
legal
and bankruptcy purposes) on all relevant books, records, tax returns, financial
statements and other applicable documents.
(b) Non-Petition.
In the
event of any breach of a representation and warranty made by the Purchaser
hereunder, each of Seller, Servicer and NCOC covenants and agrees that it will
not take any action to pursue any remedy that it may have hereunder, in law,
in
equity or otherwise, until a year and a day have passed since the date on which
all Secured Obligations have been paid in full. The Purchaser, Seller, Servicer
and NCOC agree that damages will not be an adequate remedy for breach of this
covenant and that this covenant may be specifically enforced by the Purchaser,
by the Collateral Agent or by the Lender.
-17-
(c) Cooperation.
If an
Event of Default shall have occurred and be continuing, Seller, Servicer and
NCOC shall cooperate with and provide all information and access requested
by
Lender and the Collateral Agent, in connection with any actions taken in
connection therewith pursuant to the Loan Agreement.
(d) Disposal
of Interests.
Servicer shall not sell, assign, pledge, or otherwise dispose of any of the
limited liability company interests in the Purchaser or the equity interests
in
NCAC or NCOC without the prior written consent of the Lender.
Section
6.3. Liability
of Seller, Servicer and NCOC; Indemnities.
(a) Seller,
Servicer and NCOC shall defend, indemnify and hold harmless the Purchaser,
the
Lender and each other Secured Party and their respective officers, directors,
agents and employees for:
(i) any
liability as a result of the failure of a Receivable to be originated in
compliance with all requirements of law and for any breach of any of its
representations, warranties, covenants or other agreements contained herein,
including:
(ii) from
and
against any and all costs, expenses, losses, damages, claims, and liabilities,
arising out of or resulting from the use, ownership, or operation by Seller,
Servicer, NCOC, any Affiliate thereof or any of their respective agents or
subcontractors, of a Financed Vehicle;
(iii) from
and
against any taxes that may at any time be asserted against any such Person
with
respect to the transactions contemplated in this Agreement and any of the Loan
Documents (except any income taxes arising out of fees paid to the Lender and
except any taxes to which the Lender may otherwise be subject), including
without limitation any sales, gross receipts, general corporation, tangible
personal property, privilege or license taxes (but, in the case of the
Purchaser, not including any taxes asserted with respect to federal or other
income taxes arising out of payments on the Loan) and costs and expenses in
defending against the same;
(iv) from
and
against any loss, liability or expense incurred by reason of Seller’s,
Servicer’s or NCOC’s willful misfeasance, bad faith or negligence in the
performance of its duties under this Agreement, or by reason of reckless
disregard of its obligations and duties under this Agreement;
(v) from
and
against any and all costs, expenses, losses, claims, damages and liabilities
arising out of, or incurred in connection with the acceptance or performance
of
the trusts and duties set forth herein and in the Loan Documents, except to
the
extent that such cost, expense, loss, claim, damage or liability shall be due
to
the willful misfeasance, bad faith or negligence (except for errors in judgment)
of such indemnified Party;
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(vi) from
and
against any and all costs, expenses, losses, claims, damages and liabilities
arising out of or relating to any of Seller’s, Servicer’s or NCOC’s
representations and warranties, covenants or other agreements contained herein
or in any other Loan Document to which Seller, Servicer or NCOC is a party;
or
(vii) from
and
against any and all costs, expenses, losses, claims, damages and liabilities
arising out of or relating to the failure of a Receivable to be serviced in
compliance with all requirements of law, including without limitation all
Consumer Laws, and for any breach of any of Servicer’s representations and
warranties, covenants or other agreements contained herein or in any other
Loan
Document to which Servicer is a party.
(b) Indemnification
under this Section shall survive the resignation or removal of Servicer or
the
Collateral Agent and the termination of this Agreement and the other Loan
Documents and shall include reasonable fees and expenses of counsel and other
expenses of litigation. These indemnity obligations shall be in addition to
any
obligation that Seller, Servicer or NCOC may otherwise have under applicable
law, hereunder or under any other Loan Document.
Notwithstanding
any provision of this Section
6.3
or any
other provision of this Agreement, nothing in this Agreement shall be construed
as to require Seller, Servicer or NCOC to provide any indemnification hereunder
or under any other Loan Document for any costs, expenses, losses, claims,
damages or liabilities arising out of, or incurred in connection with, credit
losses with respect to the Receivables.
Section
6.4. Delegation
of Duties.
Servicer
may not delegate duties under this Agreement, except in accordance with this
Section 6.4.
(a) The
Servicer may, at its own expense, enter into subservicing agreements with one
or
more subservicers (each a "Subservicer")
for
the servicing and administration of a portion of the Receivables with the
prior written consent of Lender (which shall be deemed given with respect
to the appointment of NCAC in (c), below). References in this
Agreement to actions taken or to be taken by the Servicer in servicing and
managing the Receivables shall be deemed to include actions taken or to be
taken
by a Subservicer on behalf of the Servicer. To the extent required by
applicable Law, each Subservicer shall be authorized to transact business in
the
state or states in which any Receivables that it services or manages are
situated. The terms and conditions of each subservicing agreement between
the Servicer and its Subservicers shall not be inconsistent with this
Agreement. For purposes of this Agreement, the Servicer shall be deemed to
have received any payment when a Subservicer receives such payment. The
Servicer shall notify the Lender in writing promptly upon the appointment of
any
Subservicer.
(b) As
part
of its duties hereunder, the Servicer, for the benefit of the Secured Parties,
shall enforce the obligations of each Subservicer under the related subservicing
agreement. Such enforcement, including, without limitation, the
prosecution of all legal claims, termination of subservicing agreements and
pursuit of other appropriate remedies, shall be in accordance with the Credit
and Collection Policy and the Servicing Guidelines. The Servicer shall pay
the costs of such enforcement at its own expense and shall be reimbursed
therefor solely from (i) a general recovery resulting from such enforcement,
but
only to the extent, if any, that such recovery exceeds all amounts due in
respect of the related Receivables, or (ii) from a specific recovery of costs,
expenses and/or attorneys' fees from the party against whom such enforcement
is
directed.
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(c) The
Servicer and NCAC hereby agree that NCAC is appointed as the Servicer’s
Subservicer with respect to all of the Receivables on the terms of this Section
6.4, for a fee payable by the Servicer to NCAC in such amount as may be agreed
by such parties from time to time.
(d) Notwithstanding
any subservicing agreement or arrangement between the Servicer and a
Subservicer, the Servicer shall remain obligated and liable to the Secured
Parties for the servicing, management, collection and administration of the
Receivables in accordance with the provisions of this Agreement, as if the
Servicer alone were servicing, managing, collecting and administering such
Receivables.
Section
6.5. Servicer
Not to Resign.
Subject
to the provisions of Section
7.3,
Servicer shall not resign from the obligations and duties imposed on it by
this
Agreement as Servicer except upon a determination that by reason of a change
in
legal requirements the performance of its duties under this Agreement would
cause it to be in violation of such legal requirements in a manner which would
have a material adverse effect on Servicer and Lender does not elect to waive
the obligations of Servicer to perform the duties which render it legally unable
to act or to delegate those duties to another Person. Any such determination
permitting the resignation of Servicer pursuant to the immediately preceding
sentence shall be evidenced by an Opinion of Counsel to such effect delivered
and acceptable to the Lender. No resignation of Servicer shall become effective
until an entity acceptable to Lender shall have assumed the responsibilities
and
obligations of Servicer.
ARTICLE
VII
SERVICER
TERMINATION EVENTS
Section
7.1. Servicer
Termination Events.
For
purposes of this Agreement, each of the following shall constitute a
“Servicer
Termination Event”:
(a) Any
failure by Servicer to deliver or cause to be delivered any proceeds or payment
required to be so delivered under this Agreement or any other Loan Document
within one (1) Business Day of the date when the same becomes due;
(b) Failure
by Servicer to deliver, or cause to be delivered, to Lender and the Collateral
Agent any Availability Report by the Determination Date prior to the related
Settlement Date, which failure continues unremedied for a period of one (1)
Business Day;
(c) Failure
by Servicer to perform or observe in any material respect any term, covenant,
or
agreement under this Agreement or any other Loan Document (other than any term,
covenant or agreement referred to in another subparagraph of this Section
7.1),
which
failure is not cured within 10 calendar days after written notice is received
by
Servicer from Lender or the Collateral Agent or after discovery of such failure
by a Responsible Officer of Servicer;
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(d) Any
representation, warranty or statement of Servicer made in this Agreement or
any
other Loan Document to which it is a party or any certificate, report or other
writing delivered pursuant hereto or thereto shall prove to be incorrect in
any
material respect as of the time when the same shall have been made, and such
incorrectness is not cured within 10 calendar days after written notice is
received by Servicer from any Secured Party or after discovery of such failure
by a Responsible Officer of Servicer;
(e) An
application is made by Servicer for the appointment of a receiver, trustee
or
custodian for the Collateral or any other material assets of Purchaser or
Servicer; a petition under any section or chapter of the Bankruptcy Code or
federal or State law or regulation shall be filed by Servicer, or Servicer
shall
make an assignment for the benefit of its creditors, or any case or proceeding
shall be filed by Servicer for its dissolution, liquidation, or termination;
or
Servicer ceases to conduct its business;
(f) Servicer
is enjoined, restrained or prevented by court order from conducting all or
any
material part of its business affairs, or a petition under any section or
chapter of the Bankruptcy Code or any similar federal or State law or regulation
is filed against Servicer, or any case or proceeding is filed against Servicer,
for its dissolution or liquidation, and such injunction, restraint, petition,
case or proceeding is not dismissed within sixty (60) days after the entry
of
filing thereof; and
(g) An
Event
of Default or a Default shall have occurred (so long as Manchester is
Servicer).
In
the
event that Servicer or Purchaser gains knowledge of the occurrence of a Servicer
Termination Event, Servicer or Purchaser, as applicable, shall promptly notify
Lender and the Collateral Agent in writing of such occurrence.
Section
7.2. Consequences
of a Servicer Termination Event.
If
a
Servicer Termination Event shall occur and be continuing, the Lender by notice
given in writing to Servicer may terminate all of the rights and obligations
of
Servicer under this Agreement. On or after the receipt by Servicer of such
written notice, all authority, power, obligations and responsibilities of
Servicer under this Agreement, whether with respect to the Receivables and
Other
Conveyed Property or otherwise, automatically shall pass to, be vested in and
become obligations and responsibilities of the successor Servicer appointed
by
Lender under Section
7.3;
provided, however, that the successor Servicer shall have no liability with
respect to any obligation which was required to be performed by the outgoing
Servicer prior to the date that the successor Servicer becomes Servicer or
any
claim of a third party based on any alleged action or inaction of the outgoing
Servicer. The successor Servicer is authorized and empowered by this Agreement
to execute and deliver, on behalf of the outgoing Servicer, as attorney-in-fact
or otherwise, any and all documents and other instruments and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement of the Receivables and the Other Conveyed Property and related
documents to show the Purchaser as lienholder or secured party on the related
Auto Title, or otherwise. The outgoing Servicer agrees to cooperate with the
successor Servicer in effecting the termination of the responsibilities and
rights of the outgoing Servicer under this Agreement, including, without
limitation, the transfer to the successor Servicer for administration by it
of
all cash amounts that shall at the time be held by the outgoing Servicer for
deposit, or have been deposited by the outgoing Servicer, in the Deposit Account
or thereafter received with respect to the Receivables and the delivery to
the
successor Servicer of all Custodial Documents that shall at the time be held
by
the outgoing Servicer and a computer tape in readable form as of the most recent
Business Day containing all information necessary to enable the successor
Servicer to service the Receivables and the Other Conveyed Property. All
reasonable costs and expenses (including reasonable attorneys’ fees) incurred in
connection with transferring any Custodial Documents to the successor Servicer
and amending this Agreement to reflect such succession as Servicer pursuant
to
this Section
7.2
shall be
paid by the predecessor Servicer upon presentation of reasonable documentation
of such costs and expenses. In addition, any successor Servicer shall be
entitled to payment from the immediate predecessor Servicer for reasonable
transition expenses incurred in connection with acting as successor Servicer,
and to the extent not so paid. The outgoing Servicer shall grant the successor
Servicer, Lender and the Collateral Agent reasonable access to the outgoing
Servicer’s premises at the outgoing Servicer’s expense.
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Section
7.3. Appointment
of Successor.
(a) On
and
after the time Servicer receives a notice of termination pursuant to
Section
7.2,
the
outgoing Servicer shall continue to perform its functions as Servicer under
this
Agreement, in the case of termination, only until the date specified in such
termination notice or, if no such date is specified in a notice of termination,
until receipt of such notice and, in the case of expiration and non-renewal
of
the term of Servicer upon the expiration of such term, and, in the case of
resignation, until (i) the later of (x) the date 45 days from the delivery
to
Lender of written notice of such resignation (or written confirmation of such
notice) in accordance with the terms of this Agreement and (y) the date upon
which the predecessor Servicer shall become unable to act as Servicer, as
specified in the notice of resignation and accompanying Opinion of Counsel
or
(ii) such time as a successor Servicer shall assume all of the rights and
obligations of the predecessor Servicer hereunder and under any other Loan
Document; provided,
however,
that
the outgoing Servicer shall not be relieved of its duties, obligations and
liabilities as Servicer until a successor Servicer has assumed such duties,
obligations and liabilities. Notwithstanding the preceding sentence, if a
successor Servicer shall not have assumed the duties, obligations and
liabilities of Servicer within 45 days of the termination or resignation
described in this Section
7.3,
the
outgoing Servicer may petition a court of competent jurisdiction to appoint
a
successor to the outgoing Servicer.
(b) Any
successor Servicer shall be entitled to such compensation as the outgoing
Servicer would have been entitled to under this Agreement if the outgoing
Servicer had not resigned or been terminated hereunder or had been renewed
for
an additional servicing term hereunder, as may be modified with the consent
of
the Lender.
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Section
7.4. Waiver
of Past Defaults.
Lender
may waive in writing any default by Servicer in the performance of its
obligations under this Agreement and the consequences thereof. Upon any such
waiver of a past default, such default shall cease to exist, and any Servicer
Termination Event arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereto.
ARTICLE
VIII
MISCELLANEOUS
Section
8.1. Notices.
Except
when telephonic notice is expressly authorized by this Agreement, any notice
or
other communication to any party in connection with this Agreement shall be
in
writing and shall be sent by manual delivery, telegram, facsimile transmission,
overnight courier or United States mail (postage prepaid) addressed to such
party at the address specified on Schedule
A
to the
Loan Agreement, or at such other address as such party shall have specified
to
the other party hereto in writing. All periods of notice shall be measured
from
the date of delivery thereof if manually delivered, from the date of sending
thereof if sent by telegram, or facsimile transmission, from the first Business
Day after the date of sending if sent by overnight courier, or from four days
after the date of mailing if mailed.
Section
8.2. Notices.
Except
when telephonic notice is expressly authorized by this Agreement, any notice
or
other communication to any party in connection with this Agreement shall be
in
writing and shall be sent by manual delivery, telegram, facsimile transmission,
overnight courier or United States mail (postage prepaid) addressed to such
party at the address specified on Schedule
A
of the
Loan Agreement, or at such other address as such party shall have specified
to
the other party hereto in writing. All periods of notice shall be measured
from
the date of delivery thereof if manually delivered, from the date of sending
thereof if sent by telegram, or facsimile transmission, from the first Business
Day after the date of sending if sent by overnight courier, or from four days
after the date of mailing if mailed.
Section
8.3. Prior
Agreements Superseded.
This
Agreement, together with the other Loan Documents, constitute the sole and
only
agreement of the parties hereto and supersede any prior understandings or
written or oral agreements between the parties respecting the subject matter
of
this Agreement and the other Loan Documents. No provision of this Agreement
or
other Loan Document may be modified, waived or terminated except by instrument
in writing executed by Lender and the party against whom a modification, waiver
or termination is sought to be enforced.
Section
8.4. Parties
Bound.
This
Agreement shall be binding upon the parties hereto and their respective
successors and assigns, and shall inure to the benefit of such parties hereto
and their respective successors and permitted assigns. No party hereto shall
assign its rights or duties hereunder without the consent of
Lender.
Section
8.5. Execution
in Counterparts.
This
Agreement may be executed in any number of counterparts and by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed to be an original, and all of which taken together shall
constitute but one and the same instrument.
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Section
8.6. Severability
of Provisions.
Any
provision which is determined to be unconscionable, against public policy or
any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
Section
8.7. Further
Instruments.
Each
party hereto shall from time to time execute and deliver, and shall cause each
of its subsidiaries to execute and deliver, all such amendments, supplements
and
other modifications hereto and to the other Loan Documents and all such
financing statements or continuation statements, instruments of further
assurance and any other instruments, and shall take such other actions, as
Lender reasonably requests and deems necessary or advisable in furtherance
of
the agreements contained herein.
Section
8.8. Governing
Law.
THIS
AGREEMENT SHALL BE DEEMED A CONTRACT AND INSTRUMENT MADE UNDER THE LAWS OF
THE
STATE OF NEW YORK AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK AND THE LAWS OF THE UNITED STATES
OF AMERICA. EACH PARTY HERETO HEREBY AGREES THAT ANY LEGAL ACTION OR PROCEEDING
AGAINST IT WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE
STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT
OF NEW YORK AS LENDER MAY ELECT, AND, BY EXECUTION AND DELIVERY HEREOF, EACH
PARTY HERETO ACCEPTS AND CONSENTS FOR ITSELF AND IN RESPECT TO ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID
COURTS. EACH PARTY HERETO AGREES THAT SECTIONS 5-1401 AND 5.1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK SHALL APPLY TO THE LOAN DOCUMENTS
AND
WAIVES ANY RIGHT TO STAY OR TO DISMISS ANY ACTION OR PROCEEDING BROUGHT BEFORE
SAID COURTS ON THE BASIS OF FORUM NON CONVENIENS. EACH PARTY HERETO HEREBY
WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT, AND AGREES THAT ALL
SUCH
SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED TO IT AT THE ADDRESS
SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED
UPON ACTUAL RECEIPT THEREOF.
Section
8.9. Consent
of Jurisdiction.
AT
THE
OPTION OF LENDER, THIS AGREEMENT, AND THE OTHER LOAN DOCUMENTS MAY BE ENFORCED
IN ANY FEDERAL COURT OR NEW YORK STATE COURT SITTING IN NEW YORK, NEW YORK;
AND
EACH PARTY HERETO CONSENTS TO THE JURISDICTION AND VENUE OF ANY SUCH COURT
AND
WAIVES ANY ARGUMENT THAT VENUE IN SUCH FORUMS IS NOT CONVENIENT. IN THE EVENT
ANY PARTY HERETO COMMENCES ANY ACTION IN ANOTHER JURISDICTION OR VENUE UNDER
ANY
TORT OR CONTRACT THEORY ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP
CREATED BY THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, LENDER AT ITS
OPTION SHALL BE ENTITLED TO HAVE THE CASE TRANSFERRED TO ONE OF THE
JURISDICTIONS AND VENUES ABOVE-DESCRIBED, OR IF SUCH TRANSFER CANNOT BE
ACCOMPLISHED UNDER APPLICABLE LAW, TO HAVE SUCH CASE DISMISSED WITHOUT
PREJUDICE.
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Section
8.10. Waiver
of Jury Trial.
EACH
PARTY HERETO WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING
TO
ENFORCE OR DEFEND ANY RIGHTS UNDER THIS AGREEMENT OR UNDER ANY OF THE OTHER
LOAN
DOCUMENTS, AND AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE
A
COURT AND NOT BEFORE A JURY.
Section
8.11. Pledge
by Purchaser.
Seller
and Servicer acknowledge that Purchaser has pledged all of its rights, title
and
interest in and to this Agreement to the Collateral Agent for the benefit of
the
Lender, and that the Collateral Agent and the Lender may enforce this Agreement
as if they were parties hereto. Each of the Collateral Agent and the Lender
are
intended third party beneficiaries of this Agreement.
Section
8.12. Time
of Essence.
Time
is
of the essence for the performance of the obligations set forth in this
Agreement and the Loan Documents.
[remainder
of page intentionally left blank]
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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their respective duly authorized officers as of the
day and the year first above written.
|
NICE
CARS FUNDING LLC,
as Purchaser |
||
| By: |
Nice Cars Acceptance AcquisitionCo, Inc.,
its
Member
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| By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | ||
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Title:
President
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NICE
CARS ACCEPTANCE ACQUISITIONCO,
INC.,
as Seller
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By:
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/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ |
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Title: President
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as Servicer
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| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
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Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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NICE
CARS OPERATIONS ACQUISITIONCO,
INC.,
as Servicer
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| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |
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Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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SCHEDULE
A
SCHEDULE
OF RECEIVABLES
[Available
upon request from Servicer]
Schedule
A — Page
1
EXHIBIT
A
FORM
OF
TRANSFER INSTRUMENT
Exhibit A —
Page
1
EXHIBIT
B
FORM
OF
ADDITION NOTICE
Nice
Cars
Funding LLC
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Corporate Secretary
Palm
Beach Multi-Strategy Fund, LP
c/o
Links
Business Capital, LP
P.
O. ▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Car
Financial Services, Inc.
▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
The
Bank
of New York, as Collateral Agent
The
Bank
of New York
▇▇▇
▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn:
Director of Agent Services, ▇▇▇▇▇ ▇▇▇▇▇▇
Gentlemen
and Ladies:
This
Addition Notice is delivered to you pursuant to Section 2.1(b) of Sale and
Servicing Agreement dated as of September 28, 2006 among Nice Cars Funding
LLC, as Purchaser (in such capacity, the “Purchaser”) and Nice Cars Acceptance
AcquisitionCo, Inc., as Seller (in such capacity, the “Seller”) and Servicer.
Capitalized terms used but not otherwise defined herein have the meanings
assigned thereto in Annex A to the Sale and Servicing Agreement.
Seller
hereby intends to transfer to the Purchaser $________ aggregate outstanding
principal amount of Receivables on _____________, 200_ (the “Funding
Date”).
The
Purchaser hereby represents and warrants to each Secured Party that all of
the
statements contained in Section 2.1(b) of the Sale and Servicing Agreement
and
Section 4 of the Loan Agreement pertaining to the transfer of the Receivables
shall be true and correct on and as of the proposed Funding Date and all of
the
conditions precedent to the funding of an Advance shall then be
satisfied.
Attached
as Schedule
A
is a
supplement to the Schedule of Receivables reflecting all Receivables Seller
intends to transfer to the Purchaser on the Funding Date. The Purchaser
represents and warrants that the information on Schedule A is true and correct
as of the date hereof.
IN
WITNESS WHEREOF, the Purchaser and Seller have caused this notice of addition
to
be executed and delivered by its duly authorized officer this ___ day of
___________, 200_.
| NICE CARS FUNDING, LLC | ||
| |
|
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| By: | ||
|
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|
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| NICE CARS ACCEPTANCE ACQUISITIONCO, INC. | ||
| |
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| By: | ||
|
Name:
|
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ANNEX
A -
DEFINED TERMS
“Account
Control Agreement”
shall
have the meaning given to that term in the Loan Agreement.
“Addition
Notice”
means,
with respect to any transfer of Receivables to the Purchaser pursuant to
Section
2.1
of the
Sale and Servicing Agreement, notice of the Seller’s election to transfer
Receivables to the Purchaser, such notice to designate the related Funding
Date
and the aggregate principal amount of Receivables to be transferred on such
Funding Date, substantially in the form of Exhibit B
to the
Sale and Servicing Agreement.
“Advance”
means
an advance made by Lender to Borrower under the Loan Agreement.
“Affiliate”
shall
have the meaning given to that term in the Loan Agreement.
“Ageing
Procedures”
shall
have the meaning given to that term in the Loan Agreement.
“Amount
Financed”
means,
with respect to a Receivable, the aggregate amount advanced under such
Receivable toward the purchase price of the Financed Vehicle and any related
costs, including amounts advanced in respect of accessories, insurance premiums,
service and warranty contracts, other items customarily financed as part
of
retail automobile installment sale contracts and related costs.
“Annual
Percentage Rate”
or
“APR”
of
a
Receivable means the annual percentage rate of finance charges or service
charges, as stated in the related Contract.
“Auto
Title Procedures”
shall
have the meaning given to that term in the Loan Agreement.
“Availability
on Eligible Receivables”
shall
have the meaning given to that term in the Loan Agreement.
“Availability
Report”
shall
have the meaning given to that term in the Loan Agreement.
“Bankruptcy
Code”
means
the Bankruptcy Reform Act of 1978, as amended from time to time, and as codified
as 11 U.S.C. Section 101 et seq.
“Blocked
Account”
shall
have the meaning given to that term in the Loan Agreement.
“Business
Day”
shall
have the meaning given to that term in the Loan Agreement.
“Closing
Date”
means
September 28, 2006.
“Code”
means
the Internal Revenue Code of 1986, as amended from time to time, and Treasury
Regulations promulgated thereunder.
“Collateral”
shall
have the meaning given to that term in the Loan Agreement.
“Collection
Account”
shall
have the meaning given to that term in the Loan Agreement.
“Collection
Period”
means
each calendar month.
“Commonly
Controlled Entity”
shall
have the meaning given to that term in the Loan Agreement.
“Consumer
Laws”
means
federal and State usury laws, the Federal Truth-in-Lending Act, the Equal
Credit
Opportunity Act, the Fair Credit Reporting Act, the Fair Debt Collection
Practices Act, the Federal Trade Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇ Warranty
Act,
the Federal Reserve Board’s Regulations B and Z, the Servicemembers Civil Relief
Act, the California Military Reservist Relief Act, the Texas Consumer Credit
Code, the California Automobile Sales Finance Act, State adaptations of the
National Consumer Act and of the Uniform Consumer Credit Code and all other
federal, State and local consumer credit laws and equal credit opportunity
and
disclosure laws and regulations thereunder.
“Contract”
means
a
motor vehicle retail installment sale contract or security agreement relating
to
the sale of used automobiles, light trucks, vans or minivans, and other writings
related thereto from time to time.
-2-
“Cram
Down Loss”
means,
with respect to a Receivable, if a court of appropriate jurisdiction in an
insolvency proceeding shall have issued an order reducing the amount owed
on a
Receivable or otherwise modifying or restructuring Scheduled Receivable Payments
to be made on a Receivable, an amount equal to such reduction in the Principal
Balance of such Receivable or the reduction in the net present value (using
as
the discount rate the lower of the contract rate or the rate of interest
specified by the court in such order) of the Scheduled Receivable Payments
as so
modified or restructured. A “Cram
Down Loss”
shall
be deemed to have occurred on the date such order is entered.
“Credit
and Collection Policy”
shall
mean the Credit and Collection Policy of the Servicer, a copy of which has
been
provided to Lender, as amended from time to time with the prior written consent
of the Lender.
“Custodial
Agreement”
shall
have the meaning given to that term in the Loan Agreement, a copy of which
has
been provided to Lender.
“Custodial
Certification”
shall
have the meaning given to that term in the Custodial Agreement.
“Custodial
Documents”
means
the documents specified in Section
2.2(a)
of the
Custodial Agreement.
“Custodian”
shall
have the meaning given to that term in the Custodial Agreement.
“Cutoff
Date”
means,
with respect to a Receivable or Receivables, the date specified as such for
such
Receivable or Receivables in the Schedule of Receivables attached to the
Sale
and Servicing Agreement or to the applicable Transfer Instrument.
“Data
Tape Fields”
has
the
meaning given such term in Section 2.1(b)(i) of the Sale and Servicing
Agreement.
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“Default”
shall
have the meaning given to that term in the Loan Agreement.
“Defective
Receivable”
means
a
Receivable that is subject to repurchase pursuant to Section
3.2
or
Section
4.7
of the
Sale and Servicing Agreement.
“Delinquency”
shall
have the meaning given to that term in the Loan Agreement.
“Determination
Date”
means,
with respect to any Settlement Date, the fourth Business Day preceding such
Settlement Date.
“Dollar”
means
lawful money of the United States.
“Eligible
Receivables”
shall
have the meaning given to that term in the Loan Agreement.
“ERISA”
means
the Employee Retirement Income Security Act of 1974, as amended.
“Event
of Default”
shall
have the meaning given to that term in the Loan Agreement.
“Facility
Termination Date”
means
the earliest of (a) the Maturity Date (b) the Termination Date and (c) the
acceleration of the obligations of the Purchaser pursuant to Section 7.2
of the
Loan Agreement.
“FDIC”
means
the Federal Deposit Insurance Corporation.
“Fee
Letter”
shall
have the meaning given to that term in the Loan Agreement.
“Financed
Vehicle”
means
a
new or used automobile, light truck, van or minivan, together with all
accessions thereto, securing an Obligor’s indebtedness under a
Receivable.
“Funding
Date”
means
each Business Day on which an Advance occurs.
“GAAP”
means
U.S. generally accepted accounting principles occasioned by the promulgation
of
rules, regulations, pronouncements or opinions by the Financial Accounting
Standards Board, the American Institute of Certified Public Accountants or
the
Securities and Exchange Commission (or successors thereto or agencies with
similar functions) from time to time.
-4-
“Governmental
Authority”
means
the United States of America, any state, local or other political subdivision
thereof and any entity exercising executive, legislative, judicial, regulatory,
or administrative functions thereof pertaining thereto.
“Guaranty
Agreements”
shall
have the meaning given to that term in the Loan Agreement.
“Guaranty
Security Agreements”
shall
have the meaning given to that term in the Loan Agreement.
“Law”
shall
have the meaning given to that term in the Loan Agreement.
“Lender”
shall
have the meaning given to that term in the Loan Agreement.
“Lien”
shall
have the meaning given to that term in the Loan Agreement.
“Liquidated
Receivable”
means
any Receivable (i) which has been liquidated by the Servicer through the
sale of the Financed Vehicle or (ii) for which the related Financed Vehicle
has been repossessed and 90 days have elapsed since the date of such
repossession or (iii) as to which an Obligor has failed to make more than
90% of a Scheduled Receivable Payment of more than ten dollars for 120 (or,
if
the related Financed Vehicle has been repossessed, 210) or more days as of
the
end of a Collection Period or (iv) with respect to which proceeds have been
received which, in the Servicer’s judgment, constitute the final amounts
recoverable in respect of such Receivable. For purposes of this definition,
a
Receivable shall be deemed a “Liquidated Receivable” upon the first to occur of
the events specified in items (i) through (iv) of the previous
sentence.
“LLC
Agreement”
means
the Limited Liability Company Agreement of the Purchaser dated as of
September 28, 2006, entered into by NCAC, as such agreement may be amended,
supplemented or otherwise modified from time to time in accordance with the
terms thereof.
-5-
“Loan”
shall
have the meaning given to that term in the Loan Agreement.
“Loan
Agreement”
means
the Loan and Security Agreement dated the date hereof between the Lender,
the
Purchaser and the Collateral Agent.
“Loan
Documents”
shall
have the meaning given to that term in the Loan Agreement.
“Lockbox”
means
any lockbox account set up pursuant to Section 3.9 of the Loan Agreement
into
which all Obligors are directed to mail all payments in connection with all
Receivables, and from which all cash receipts shall be deposited into the
Blocked Account.
“Manchester”
means
Manchester Inc., a Nevada corporation, and its successors and permitted
assigns.
“Material
Adverse Effect”
shall
have the meaning given to that term in the Loan Agreement.
“Maturity
Date”
shall
have the meaning given
to that
term in the Loan Agreement.
“Multiemployer
Plan”
means
a
Plan which is a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.
“NCAC”
shall
have the meaning given to that term in the Loan Agreement.
“Net
Liquidation Proceeds”
means,
with respect to a Liquidated Receivable, all amounts realized with respect
to
such Receivable net of (i) reasonable expenses incurred by the Servicer in
connection with the collection of such Receivable and the repossession and
disposition of the Financed Vehicle and the reasonable cost of legal counsel
with the enforcement of a Liquidated Receivable and (ii) amounts that are
required to be refunded to the Obligor on such Receivable; provided,
however,
that
the Net Liquidation Proceeds with respect to any Receivable shall in no event
be
less than zero.
“Note”
shall
have the meaning given to that term in the Loan Agreement.
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“Obligor”
means
any Person or Persons that are an obligor (including without limitation any
co-▇▇▇▇▇▇) in respect of any Receivable.
“Officer’s
Certificate”
means
a
certificate signed by the chairman of the board, the president, any vice
chairman of the board, any vice president, the treasurer, the controller
or
assistant treasurer or any assistant controller, secretary or assistant
secretary of the Seller, the Purchaser or the Servicer, as
appropriate.
“Opinion
of Counsel”
means
a
written opinion of counsel who may be but need not be counsel to the Purchaser,
the Seller or the Servicer, which counsel shall be reasonably acceptable
to the
Lender and which opinion shall be acceptable in form and substance to the
Lender.
“Other
Conveyed Property”
means
all property conveyed by the Seller to the Purchaser pursuant to Sections
2.1 (a)(ii)
through
(xi)
of the
Sale and Servicing Agreement and Section 2 of each Transfer
Instrument.
“Person”
shall
have the meaning given to that term in the Loan Agreement.
“Plan”
means
any Person that is (i) an “employee benefit plan” (as defined in Section 3(3) of
ERISA) that is subject to the provisions of Title I of ERISA, (ii) a “plan” (as
defined in Section 4975(e)(1) of the Code) that is subject to Section 4975
of
the Code or (ii) any entity whose underlying assets include assets of a plan
described in (i) or (ii) above by reason of such plan’s investment in the
entity.
“Principal
Balance”
of
a
Receivable means the Amount Financed minus the sum of the following amounts
without duplication: (i) that portion of all Scheduled Receivable Payments
actually received on or prior to such day allocable to principal using the
Simple Interest Method; (ii) any Cram Down Loss in respect of such Receivable;
and (iii) any prepayment in full or any partial prepayment applied to reduce
the
principal balance of the Receivable, all measured as of the close of business
on
such day.
-7-
“Proceeding”
means
any suit in equity, action at law or other judicial or administrative
proceeding.
“Purchase
Amount”
means,
on any date with respect to a Defective Receivable, the sum of (a) the Principal
Balance of such Receivable as of the date of purchase of such Receivable,
and
(b) all accrued and unpaid interest on the Receivable.
“Purchase
Price”
means,
with respect to each Receivable and related Other Conveyed Property transferred
to the Purchaser on any Funding Date, an amount equal to the Principal Balance
of such Receivable as of such Funding Date.
“Purchased
Receivable”
means
a
Receivable purchased by the Servicer pursuant to Section
4.7
of the
Sale and Servicing Agreement or repurchased by the Seller pursuant to
Section
3.2
of the
Sale and Servicing Agreement.
“Purchaser”
means
Nice Cars Funding LLC, a Delaware limited liability company.
“Receivables”
means
all retail installment sale contracts for Financed Vehicles made the subject
of
a Transfer Instrument, except for receivables that shall have become Purchased
Receivables, and, for the avoidance of doubt, shall include all Related
Receivables (other than Related Receivables that shall have become Purchased
Receivables).
“Receivables
Insurance Policy”
shall
have the meaning given to that term in Section 4.4 of the Sale and Servicing
Agreement.
“Related
Party”
shall
have the meaning given to that term in the Loan Agreement.
-8-
“Related
Receivables”
means,
with respect to a Funding Date, the Receivables listed on Schedule A
to the
applicable Transfer Instrument executed and delivered by the Seller with
respect
to such Funding Date.
“Responsible
Officer”
means,
with respect to any Person, the chairman or vice-chairman of the board of
directors, the chairman or vice-chairman of the executive committee of the
board
of directors, the president, vice-president, assistant vice-president or
managing director, the secretary, and assistant secretary or any other officer
of such Person customarily performing functions similar to those performed
by
any of the above designated officers and also means, with respect to a
particular matter, any other officer to whom such matter is referred because
of
such officer’s knowledge of and familiarity with the particular
subject.
“Sale
and Servicing Agreement”
means
the Sale and Servicing Agreement dated as of September 28, 2006, among Nice
Cars Funding LLC, as Purchaser, NCAC, as Seller, and Manchester Inc., as
Servicer, as the same may be amended or supplemented from time to time in
accordance with the terms thereof.
“Scheduled
Receivable Payment”
means,
with respect to any Collection Period for any Receivable, the amount set
forth
in such Receivable as required to be paid by the Obligor in such Collection
Period. If after the Closing Date, the Obligor’s obligation under a Receivable
with respect to an Collection Period has been modified so as to differ from
the
amount specified in such Receivable (i) as a result of the order of a court
in
an insolvency proceeding involving the Obligor, (ii) pursuant to the
Servicemembers Civil Relief Act, or (iii) as a result of modifications or
extensions of the Receivable permitted by Section 4.2 of the Sale and Servicing
Agreement, the Scheduled Receivable Payment with respect to such Collection
Period shall refer to the Obligor’s payment obligation with respect to such
Collection Period as so modified.
-9-
“Schedule
of Receivables”
means
the schedule of all Receivables purchased by the Purchaser pursuant to the
Sale
and Servicing Agreement and each Transfer Instrument, which is attached as
Schedule A to the Sale and Servicing Agreement, as amended or supplemented
from
time to time upon each Transfer Instrument of Receivables or in accordance
with
the terms of the Sale and Servicing Agreement.
“Secured
Obligations”
shall
have the meaning given to that term in the Loan Agreement.
“Secured
Parties”
means
Lender and the Collateral Agent.
“Securities
Act”
means
the Securities Act of 1933, as amended.
“Seller”
means
Manchester and its successors in interest to the extent permitted
hereunder.
“Seller
Default”
means
(i)
any
failure by the Seller to deliver or cause to be delivered any payment required
to be so delivered under any Basic Document within one (1) Business Day of
the
date when the same becomes due;
(ii) failure
by the Seller to perform or observe in any material respect any other term,
covenant, or agreement under any Basic Document which is not cured within
10
calendar days after written notice is received by the Seller from the Lender
or
the Collateral Agent or after discovery of such failure by a Responsible
Officer
of the Seller;
(iii)
any
representation, warranty or statement of the Seller made in any Basic Document
to which it is a party or any certificate, report or other writing delivered
pursuant hereto or thereto shall prove to be incorrect in any material respect
as of the time when the same shall have been made, and such incorrectness
is not
cured within 10 calendar days after written notice is received by the Seller
from any Lender Party or after discovery of such failure by a Responsible
Officer of the Seller;
(iv)
an
application is made by the Seller for the appointment of a receiver, trustee
or
custodian for any of its assets; a petition under any section or chapter
of the
Bankruptcy Code or federal or State law or regulation shall be filed by the
Seller, or the Seller shall make an assignment for the benefit of its creditors,
or any case or proceeding shall be filed by the Seller for its dissolution,
liquidation, or termination; or the Seller ceases to conduct its
business;
(v)
the
Seller is enjoined, restrained or prevented by court order from conducting
all
or any material part of its business affairs, or a petition under any section
or
chapter of the Bankruptcy Code or any similar federal or State law or regulation
is filed against the Seller, or any case or proceeding is filed against the
Seller, for its dissolution or liquidation, and such injunction, restraint,
petition, case or proceeding is not dismissed within sixty (60) days after
the
entry of filing thereof;
or (vi)
the occurrence of any event which, with the passage of time or the giving
of
notice, or both, would result in any of the matters referred to in (i) through
(v) above.
-10-
“Servicer”
means,
initially, Manchester, as the servicer of the Receivables, and each successor
Servicer pursuant to Section
10.3
of the
Sale and Servicing Agreement.
“Servicer
Termination Event”
means
an event specified in Section
7.1
the Sale
and Servicing Agreement.
“Servicing
Fee”
has
the
meaning specified in Section
4.8
of the
Sale and Servicing Agreement.
“Servicing
Guidelines”
means
the servicing guidelines of the Servicer, a copy of which has been given
to the
Lender, as amended from time to time with the prior written consent of the
Lender.
“Settlement
Date”
shall
have the meaning given to that term in the Loan Agreement.
“Simple
Interest Method”
means
the method of allocating a fixed level payment between principal and interest,
pursuant to which the portion of such payment that is allocated to interest
is
equal to the product of the APR multiplied by the unpaid balance multiplied
by
the period of time (expressed as a fraction of a year, based on the actual
number of days in the calendar month and the actual number of days in the
calendar year) elapsed since the preceding payment of interest was made and
the
remainder of such payment is allocable to principal.
-11-
“Termination
Date”
shall
have the meaning given to that term in the Loan Agreement.
“Transfer
Instrument”
means
a
Transfer Instrument from the Seller to the Purchaser with respect to the
Receivables and Other Conveyed Property to be conveyed by the Seller to the
Purchaser on any Funding Date, in substantially the form of Exhibit A
to the
Sale and Servicing Agreement.
“UCC”
means
the Uniform Commercial Code as in effect in the relevant jurisdiction, as
amended from time to time.
“Underwriting
Guidelines”
shall
mean the underwriting guidelines of the Seller, a copy of which has been
provided to the Lender, as amended from time to time with the prior written
consent of the Lender.
-12-