Exhibit 4.5
EXECUTION COPY
SALE AND CONTRIBUTION AGREEMENT
AMONG
MFN FUNDING LLC,
AS PURCHASER,
MERCURY FINANCE COMPANY LLC,
AS SELLER,
AND
▇▇▇▇▇ FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
AS COLLATERAL AGENT
DATED AS OF
MARCH 1, 2001
ARTICLE I
DEFINITIONS
SECTION 1.1...................................................General 1
SECTION 1.2............................................Specific Terms 1
SECTION 1.3............................................Usage of Terms 2
SECTION 1.4...............................................No Recourse 3
ARTICLE II
CONVEYANCE OF THE RECEIVABLES
SECTION 2.1...................Conveyance of the Receivables and the
................................... Other Conveyed Property 3
SECTION 2.2.........................Purchase/Contribution Allocations 4
SECTION 2.3......................Frequency of Contributions and Sales 4
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1.....................Representations and Warranties of MFC 4
ARTICLE IV
COVENANTS OF THE SELLER
SECTION 4.1............................................Liens in Force 8
SECTION 4.2.............................................No Impairment 8
SECTION 4.3.............................................No Amendments 8
SECTION 4.4.....................................Restrictions on Liens 8
SECTION 4.5................................Preservation of Collateral 8
SECTION 4.6.................................Preservation of Existence 8
SECTION 4.7........................................Separate Existence 9
SECTION 4.8.................................................Documents 9
SECTION 4.9...........Sales, Liens, Etc. Against Membership Interests 9
ARTICLE V
REPURCHASES
SECTION 5.1.......................Repurchase Upon Breach of Warranty 10
SECTION 5.2....................Reassignment of Purchased Receivables 10
SECTION 5.3..................................................Waivers 10
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.1........................Conditions Precedent to each Sale 11
ARTICLE VII
MISCELLANEOUS
SECTION 7.1......................................Liability of Seller 11
SECTION 7.2....................Merger or Consolidation of the Seller 11
SECTION 7.3.........Limitation on Liability of the Seller and Others 12
SECTION 7.4................................................Amendment 12
SECTION 7.5..................................................Notices 12
SECTION 7.6...................................Merger and Integration 12
SECTION 7.7...............................Severability of Provisions 12
SECTION 7.8.................................Intention of the Parties 12
SECTION 7.9............................................Governing Law 13
SECTION 7.10............................................Counterparts 13
SECTION 7.11........Conveyance of the Receivables and the Other
................Conveyed Property to the Collateral Agent 13
SECTION 7.12....................................Nonpetition Covenant 13
EXHIBITS
Exhibit A........................................Form of Supplement
SALE AND CONTRIBUTION AGREEMENT
-------------------------------
THIS SALE AND CONTRIBUTION AGREEMENT, dated as of March 1,
2001, executed among MFN Funding LLC ("MFN Funding"), a Delaware limited
liability company, as purchaser ("Purchaser"), ▇▇▇▇▇ Fargo Bank Minnesota,
National Association, as collateral agent (the "Collateral Agent") and Mercury
Finance Company LLC, a Delaware limited liability company ("MFC"), as seller
(the "Seller").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Purchaser has agreed to purchase from time to time
from the Seller, and the Seller, pursuant to this Agreement, has agreed to
transfer from time to time to the Purchaser the Receivables and Other Conveyed
Property.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements hereinafter contained, and for other good and valuable
consideration, the receipt of which is acknowledged, Purchaser and the Seller,
intending to be legally bound, hereby agree as follows:
DEFINITIONS
General. The specific terms defined in this Article include the plural
as well as the singular. The words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision, and Article, Section, Schedule
and Exhibit references, unless otherwise specified, refer to Articles and
Sections of and Schedules and Exhibits to this Agreement. Capitalized terms used
herein without definition shall have the respective meanings assigned to such
terms in the Security Agreement (as defined herein) or the Receivables Financing
Agreement (as defined herein).
Specific Terms. Whenever used in this Agreement, the following words
and phrases, unless the context otherwise requires, shall have the following
meanings:
"Agreement" shall mean this Sale and Contribution Agreement
and all amendments hereof.
"Collateral Agent" means ▇▇▇▇▇ Fargo, as collateral agent and
any successor collateral agent appointed and acting pursuant to the Security
Agreement.
"Custodian Agreement" means the Custodian Agreement, dated as
of the date hereof, by and between Deutsche Bank, as Agent and ▇▇▇▇▇ Fargo, as
Custodian and as Collateral Agent.
"Deutsche Bank" means Deutsche Bank AG, New York Branch.
"Initial Cutoff Date" means March 17, 2001.
"Initial Sale and Contribution Date" means March 23, 2001.
"Other Conveyed Property" means all property conveyed by the
Seller to the Purchaser pursuant to this Agreement other than the Receivables.
"Receivables Financing Agreement" means the Receivables
Financing Agreement, dated as of March 1, 2001, by and among the Purchaser, as
Borrower, MFN, in its individual capacity and as Performance Guarantor, MFC, as
Servicer, the Lenders party thereto, Deutsche Bank, as Agent and ▇▇▇▇▇ Fargo, as
Backup Servicer, Custodian and Collateral Agent.
"Relevant Cutoff Date" means (a) the Initial Cutoff Date, with
respect to Receivables in existence on the Initial Cutoff Date and (b) the date
set forth in the applicable Supplement with respect to each subsequent Transfer
Date.
"Repurchase Event" means the occurrence of a breach of
Seller's representations and warranties set forth in Section 3.1 at a Transfer
Date to the extent such breach materially and adversely affects the value of any
Receivable transferred at such Transfer Date or the interest of the Purchaser or
its assigns therein and, in any event, a breach of Seller's representations and
warranties set forth in Section 3.1(a),(e),(h),(i),(j) or (p) or the breach of
any Seller covenants set forth in Sections 4.1, 4.2, 4.3, 4.4 or 4.8 which
requires the repurchase of a Receivable by MFC hereunder or under the
Receivables Financing Agreement.
"Schedule" means the lists of Receivables contributed and/or
sold and transferred pursuant to this Agreement and attached to a Supplement.
"Security Agreement" means the Security and Collateral Agent
Agreement, dated as of the date hereof, by and among the Purchaser, as Borrower,
MFC, as Servicer, Deutsche Bank, as Agent and ▇▇▇▇▇ Fargo, as Collateral Agent.
"Supplement" means an agreement by and between the Seller and
the Purchaser pursuant to which the Purchaser will acquire Receivables
substantially in the form of Exhibit A hereto.
"Transfer Date" means (a) the date of this Agreement, with
respect to Receivables in existence on the Initial Cutoff Date and (b) the date
set forth in the applicable Supplement with respect to any contribution and/or
sale by the Seller to the Purchaser of Receivables created after the Initial
Cutoff Date.
"▇▇▇▇▇ Fargo" means ▇▇▇▇▇ Fargo Bank Minnesota, National
Association.
Usage of Terms. With respect to all terms used in this Agreement, the
singular includes the plural and the plural the singular; words importing any
gender include the other gender; references to "writing" include printing,
typing, lithography, and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement, the Custodian
Agreement, the Security Agreement or the Receivables Financing Agreement;
references to Persons include their
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permitted successors and assigns; and the terms "include" or "including" mean
"include without limitation" or "including without limitation."
No Recourse. Without limiting the obligations of the Seller hereunder
and except to the extent otherwise provided in the Transaction Documents, no
recourse may be taken, directly or indirectly, under this Agreement or any
certificate or other writing delivered in connection herewith or therewith,
against any stockholder, officer or director, as such, of the Seller, or of any
predecessor or successor of the Seller.
CONVEYANCE OF THE RECEIVABLES
AND THE OTHER CONVEYED PROPERTY
Conveyance of the Receivables and the Other Conveyed Property. By
execution of this Agreement and subject to the terms and conditions of this
Agreement, the Seller shall sell and/or contribute, transfer or assign to the
Purchaser (collectively, the "Conveyance") without recourse (but without
limitation of its obligations in this Agreement and the other Transaction
Documents), and the Purchaser shall purchase or acquire as a contribution, all
right, title and interest of the Seller in and to:
(a) on the Initial Sale and Contribution Date, each and every
Receivable in existence on the Initial Cutoff Date and all monies paid or
payable thereon or in respect thereof on or after the Initial Cutoff Date and
(b) on each subsequent Transfer Date, each and every Receivable created after
the prior Relevant Cutoff Date and in existence on the Relevant Cutoff Date as
set forth in the Supplement and Schedule delivered by the Seller and all monies
paid or payable thereon or in respect thereof on or after the Relevant Cutoff
Date;
on each Transfer Date, the security interests in the related
Financed Vehicles granted by Obligors pursuant to such Receivables and any other
interest of the Seller in such Financed Vehicles transferred on such Transfer
Date;
on each Transfer Date, all proceeds and the rights to receive
proceeds with respect to the Receivables transferred on such Transfer Date from
claims on any physical damage, credit life or disability insurance policies or
Collateral Insurance (if any), covering Financed Vehicles or Obligors;
on each Transfer Date, all rights under any service contracts
on the Financed Vehicles related to the Receivables transferred on such Transfer
Date;
on each Transfer Date, all rights of the Seller (x) against
Dealers pursuant to Dealer Agreement or Dealer Assignments, (y) against third
party lenders pursuant to the related purchase agreements with the Seller with
respect to any Receivable and (z) in, to and under the Contribution Agreement,
in each case related to the Receivables transferred on such Transfer Date;
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the Receivables Files related to the Receivables transferred
on such Transfer Date; and
all proceeds of any or all of the foregoing.
Purchase/Contribution Allocations. In exchange for such sale and
contribution, the Seller will be credited with an increase in its capital
account and shall receive cash proceeds in amounts set forth on the Supplement
and Schedule. The parties hereto intend that the allocation between the purchase
price of the assets being purchased hereunder and the capital contribution shall
be such that any Receivables that are not purchased by the Borrower for a cash
purchase price equal to the face amount of net Receivables (which, after giving
effect to the maximum liability of the Seller under the Seller Guaranty,
approximates fair value) and paid on the date of any Advance under the
Receivables Financing Agreement shall be contributed to the Purchaser and
Seller's capital account shall be increased in an amount equal to the face
amount of such Receivables contributed (which, after giving effect to the
maximum liability of the Seller under the Seller Guaranty, approximates fair
value) .
Frequency of Contributions and Sales. Seller shall contribute and sell
all Receivables owed and acquired by it to the Purchaser on a Transfer Date
selected by the Seller but not less frequently than once during each Collection
Period.
REPRESENTATIONS AND WARRANTIES
Representations and Warranties of MFC. MFC makes the following
representations and warranties as of the date hereof and as of each Transfer
Date, as the case may be, on which Purchaser relies in purchasing the
Receivables and the Other Conveyed Property. Such representations are made as of
the execution and delivery of this Agreement and as of each Transfer Date, but
shall survive (i) the sale and/or contribution, transfer and assignment of the
Receivables and the Other Conveyed Property hereunder, and (ii) the pledge and
assignment thereof by Purchaser to the Collateral Agent under the Security
Agreement and the Receivables Financing Agreement. MFC and Purchaser agree that
Purchaser will assign to Collateral Agent all Purchaser's rights under this
Agreement and that the Collateral Agent will thereafter be entitled to enforce
this Agreement against MFC in the Collateral Agent's own name on behalf of the
Secured Parties.
Receivables. Upon each Transfer Date, the Purchaser (i) will
acquire each Receivable and the Other Conveyed Property free and clear
of any Adverse Claim and (ii) will purchase each purchased Receivable
at its respective face amount (which, after giving effect to the
maximum liability of the Seller under the Seller Guaranty, approximates
fair value) and receive a contribution of each contributed Receivable
at its respective face amount (which, after giving effect to the
maximum liability of the Seller under the Seller Guaranty, approximates
fair value) in each case, as contemplated by Section 2.2.
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Organization and Good Standing. MFC has been duly organized
and is validly existing as a limited liability company in good standing
under the laws of the State of Delaware, with power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at
all relevant times, and now has, power, authority and legal right to
acquire, own and sell the Receivables and the Other Conveyed Property
to be transferred to Purchaser and to enter into and perform its
obligations under this Agreement.
Due Qualification. MFC is duly qualified to do business as a
foreign entity in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions in which the ownership or
lease of its property or the conduct of its business requires such
qualification, except where failure to be so qualified or in good
standing would not have a material adverse effect on such Seller's
business, properties or operations, and would not have a material
adverse effect on the transactions contemplated hereunder.
Power and Authority. MFC has the power and authority to
execute and deliver this Agreement and the other Transaction Documents
to which it is a party and to carry out its terms and their terms,
respectively; MFC has full power and authority to sell or contribute
and assign the Receivables and the Other Conveyed Property to be sold
or contributed and assigned to and deposited with Purchaser hereunder
and has duly authorized such sale or contribution, transfer and
assignment to Purchaser by all necessary limited liability company
action; and the execution, delivery and performance of this Agreement
and the other Transaction Documents to which it is a party have been
duly authorized by MFC by all necessary limited liability company
action.
Valid Sale; Binding Obligations. This Agreement and MFC's
Transaction Documents have been duly executed and delivered, shall
effect a valid sale or contribution, transfer and assignment of the
Receivables and the Other Conveyed Property to the Purchaser,
enforceable against MFC and creditors of and purchasers from MFC; and
this Agreement and MFC Transaction Documents constitute legal, valid
and binding obligations of MFC enforceable in accordance with their
respective terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting
the enforcement of creditors' rights generally and by equitable
limitations on the availability of specific remedies, regardless of
whether such enforceability is considered in a proceeding in equity or
at law.
No Violation. The consummation of the transactions
contemplated by this Agreement and the other Transaction Documents to
which it is a party, and the fulfilment of the terms of this Agreement
and the other Transaction Documents to which it is a party, shall not
conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time) a default
under the limited liability company agreement of MFC, or any indenture,
agreement, mortgage, deed of trust or other instrument to which MFC is
a party or by which it is bound or any of its properties are subject,
or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement,
mortgage, deed of trust or other instrument, other than this Agreement,
the Security Agreement and the Receivables Financing Agreement, or
violate any law, order, rule or regulation applicable to MFC of any
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Official Body having jurisdiction over MFC or any of its properties or
in any way adversely affect MFC's ability to perform its obligations
under this Agreement or the other Transaction Documents to which it is
a party.
No Proceedings. There are no proceedings or investigations
pending against or, to MFC's knowledge, threatened against MFC, before
any court or other Official Body having jurisdiction over MFC or its
properties (i) asserting the invalidity of this Agreement or any of the
other Transaction Documents, (ii) seeking to prevent the consummation
of any of the transactions contemplated by this Agreement or any of the
other Transaction Documents, (iii) seeking any determination or ruling
that could reasonably be expected to materially and adversely affect
the performance by MFC of its obligations under, or the validity or
enforceability of, this Agreement or any of the Transaction Documents,
(iv) seeking to affect adversely the federal income tax or other
federal, state or local tax attributes of, or seeking to impose any
excise, franchise, transfer or similar tax upon, the transfer and
acquisition of the Receivables and the Other Conveyed Property
hereunder or under the Receivables Financing Agreement or Security
Agreement and do not require any action by or require the consent or
approval of or the filing of any notice with any Official Body or any
other Person other than the filing of financing statements in
appropriate offices or (v) that could reasonably be expected to have a
material adverse effect on the Receivables.
Chief Executive Office. The chief executive office of MFC is
located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
No Adverse Selection. No selection procedures adverse to the
parties hereto or to the Secured Parties have been utilized in
selecting the Receivables from all other similar Receivables owned by
MFC.
Solvency. MFC shall not be insolvent on any Transfer Date and
no Conveyance will cause MFC to become insolvent.
No Consents. MFC is not required to obtain the consent of any
other Person which has not been obtained, or any consent, license,
approval or authorization of, or registration or declaration with, any
Official Body in connection with the execution, delivery, performance,
validity or enforceability of this Agreement or the other Transaction
Documents to which it is a party.
Compliance With Laws. MFC has complied and will comply in all
material respects with all applicable laws, rules, regulations,
judgments, agreements, decrees and orders with respect to its business
and properties and all Receivables.
Taxes. MFC has filed on a timely basis all tax returns
(including, without limitation, foreign, federal, state, local and
otherwise) required to be filed, is not liable for taxes payable by any
other Person (except for those affiliates included in MFN's
consolidated returns) and has paid or made adequate provisions for the
payment of all taxes, assessments and other governmental charges due
from MFC. No tax lien or similar adverse claim has been filed, and no
claim is being asserted, with respect to any such tax,
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assessment or other governmental charge. Any taxes, fees and other
governmental charges payable by MFC in connection with the execution
and delivery of this Agreement and the other Transaction Documents and
the transactions contemplated hereby or thereby have been paid or
shall have been paid if and when due at or prior to the Closing Date.
Financial or Other Condition. There has been no material
adverse change in the condition (financial or otherwise), business,
operations, results of operations, or properties of MFC since March 1,
2001.
Investment Company Status. MFC is not an "investment company"
within the meaning of the Investment Company Act of 1940, as amended,
or is exempt from all provisions of such Act.
No Trade Names. MFC has no trade names, fictitious names,
assumed names or "doing business as" names.
Investments. MFC does not own or hold, directly or
indirectly, any capital stock or equity security of, or any equity
interest in, any Person other than the Purchaser.
Representation and Warranties True and Correct. Each of the
representations and warranties of MFC contained in this Agreement and
the other Transaction Documents is true and correct in all material
respects and MFC hereby makes each such representation and warranty to,
and for the benefit of, the Collateral Agent and the Purchaser as if
the same were set forth in full herein.
Transaction Documents. Neither MFC nor any Affiliate party
thereto is in default of any of its obligations under the Transaction
Documents in any material respect. Upon the purchase and/or
contribution of each Receivable pursuant to this Agreement, the
Purchaser shall be the lawful owner of, and have good title to, such
Receivable and all assets relating thereto, free and clear of any
Liens. All such assets are transferred to the Purchaser without
recourse to MFC except as described herein. The purchases of such
assets by the Purchaser constitute valid and true sales for
consideration (and not merely a pledge of such assets for security
purposes) and the contributions of such assets received by the
Purchaser constitute valid and true transfers for consideration, each
enforceable against creditors of MFC, and no such assets shall
constitute property of MFC.
Ownership of MFC. All of the membership interests of MFC are
owned, either directly or indirectly, by the Contributing Subsidiaries
or their respective successors or Affiliates.
COVENANTS OF THE SELLER
Liens in Force. The Financed Vehicle securing each Receivable shall not
be released by the Seller in whole or in part from the security interest granted
under the related Receivable, except upon payment in full of the Receivable or
as otherwise contemplated herein
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or the Transaction Documents and the Seller shall not take or permit any action
inconsistent with the foregoing.
No Impairment. The Seller shall do nothing to impair the rights of the
Purchaser or the Secured Parties in the Receivables, the Dealer Agreements, the
Dealer Assignments, the Insurance Policies or any other property or interest
comprising the Other Conveyed Property.
No Amendments. The Seller shall not take or permit any action to extend
or otherwise amend the terms of any Receivable, except in accordance with the
Transaction Documents.
Restrictions on Liens. The Seller shall not: (i) create or incur or
agree to create or incur, or consent to cause (upon the happening of a
contingency or otherwise) the creation, incurrence or existence of any Lien or
restriction on transferability of the Receivables or of any Other Conveyed
Property except for the Lien in favor of the Purchaser and the Collateral Agent
as assignee thereof, and the restrictions on transferability imposed by this
Agreement or (ii) sign or file under the Uniform Commercial Code of any
jurisdiction any financing statement or sign any security agreement authorizing
any secured party thereunder to file such financing statement, with respect to
the Receivables or to any Other Conveyed Property, except in each case any such
instrument solely securing the rights and preserving the Lien of the Purchaser
and the Collateral Agent as assignee thereof. The Seller will take no action to
cause any Receivable to be evidenced by an instrument (as such term is defined
in the relevant UCC).
Preservation of Collateral. MFC will do, execute, acknowledge and
deliver, or cause to be done, executed, acknowledged and delivered, such
instruments of transfer or take such other steps or actions as may be necessary,
or required by the Purchaser or the Collateral Agent or the Agent, to effect the
Conveyance, to perfect the security interest granted in the Receivables and the
Other Conveyed Property to the Collateral Agent on behalf of the Secured
Parties, to ensure that such Conveyance and security interest ranks prior to all
other Liens and to preserve the priority of such Conveyance and security
interest and the validity and enforceability thereof.
Preservation of Existence. MFC shall observe all procedures required by
its organizational documents and operating agreement and preserve and maintain
its existence, rights, franchises and privileges in the jurisdiction of
organization, and qualify and remain qualified in good standing in each
jurisdiction where the failure to preserve and maintain such existence, rights,
franchises, privileges and qualifications would materially adversely affect (1)
the interests hereunder of the Collateral Agent or any Affected Person, (2) the
collectibility of any Receivable or (3) its ability to perform its obligations
hereunder or under any of the other Transaction Documents.
Separate Existence. MFC shall take all reasonable steps (including,
without limitation, all steps that the Agent may from time to time reasonably
request) to maintain MFC's identity as a separate legal entity from the
Purchaser and to make it manifest to third parties that MFC is an entity with
assets and liabilities distinct from those of the Purchaser and each other
Affiliate thereof. Without limiting the generality of the foregoing, MFC shall:
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account for and manage its liabilities separately from those
of the Purchaser, including, without limitation, payment of all payroll
and other administrative expenses and taxes from its own assets (it
being understood, however, that Borrower is a "disregarded entity" for
tax purposes);
maintain its assets separately from the Purchaser;
maintain offices through which its business is conducted
separate from those of the Purchaser (provided that, to the extent that
the Servicer and any of its Affiliates have offices in the same
location, there shall be a fair and appropriate allocation of overhead
costs and expenses among them, and each such entity shall bear its fair
share of such expenses);
not commingle its funds with those of the Purchaser except to
the extent contemplated herein or in the Receivables Financing
Agreement, or use its funds for other than the MFC's uses; and
ensure that any financial reports required of MFC shall comply
with GAAP and shall be issued separately from, but may be consolidated
with, any reports prepared by the Purchaser.
Documents. MFC shall comply with each of the terms of the Transaction
Documents to which it is party (in any capacity) and shall not cancel or
terminate any of the Transaction Documents to which it is party or subject (in
any capacity), or consent to or accept any cancellation or termination of any of
such agreements, or amend or otherwise modify any term or condition of any of
the Transaction Documents to which it is party or subject (in any capacity) or
give any consent, waiver or approval under any such agreement, or waive any
default under or breach of any of the Transaction Documents to which it is party
(in any capacity) or take any other action under any such agreement not required
by the terms thereof, unless (in each case) the Agent shall have consented
thereto.
Sales, Liens, Etc. Against Membership Interests. The Seller shall not,
except as otherwise provided herein or in the Membership Pledge Agreement, sell,
assign (by operation of law or otherwise) or otherwise dispose of, or create or
suffer to exist, any lien upon or with respect to, its membership interests in
the Purchaser.
REPURCHASES
Repurchase Upon Breach of Warranty. Upon the occurrence of a Repurchase
Event, MFC shall (unless the breach which is the subject of such Repurchase
Event shall have been cured in all material respects by the last day of the
second Determination Date after such breach), repurchase the Receivable or
Receivables affected thereby from the Purchaser and, simultaneously with the
repurchase of the Receivable, MFC shall deposit the Purchase Amount in full,
without deduction or offset, to the Collection Account, pursuant to Section 8.18
of the Receivables Financing Agreement. The provisions of this Section 5.1 are
intended to grant the Collateral Agent and the Agent a direct right against MFC
to demand performance hereunder,
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and in connection therewith, MFC waives any requirement of prior demand against
Purchaser with respect to such repurchase obligation. Any such repurchase shall
take place in the manner specified in Section 8.7 of the Receivables Financing
Agreement. Notwithstanding any other provision of this Agreement or the
Receivables Financing Agreement to the contrary, the obligation of MFC under
this Section shall not terminate upon a termination of MFC as Servicer under the
Receivables Financing Agreement and shall be performed in accordance with the
terms hereof notwithstanding the failure of the Servicer or Purchaser to perform
any of their respective obligations with respect to such Receivable under the
Receivables Financing Agreement.
Reassignment of Purchased Receivables. Upon deposit in the Collection
Account of the Purchase Amount of any Receivable repurchased by MFC under
Section 5.1 hereof, Purchaser (at MFC's expense) shall take such steps as may be
reasonably requested by MFC in order to assign to MFC all of Purchaser's and the
Collateral Agent's right, title and interest in and to such purchased Receivable
and all security and documents and all Other Conveyed Property conveyed to
Purchaser and the Collateral Agent directly relating thereto, without recourse,
representation or warranty, except as to the absence of Liens created by or
arising as a result of actions of Purchaser or the Collateral Agent. Such
assignment shall be a sale and assignment outright, and not for security. If,
following the reassignment of a Receivable, in any enforcement suit or legal
proceeding, it is held that MFC may not enforce any such Receivable on the
ground that it shall not be a real party in interest or a holder entitled to
enforce the Receivable, Purchaser and the Collateral Agent shall, at the expense
of MFC, take such steps as MFC deems reasonably necessary to enforce the
Receivable, including bringing suit in Purchaser's or in the Collateral Agent's
name.
Waivers. No failure or delay on the part of Purchaser, or the
Collateral Agent as assignee of Purchaser, in exercising any power, right or
remedy under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power, right or remedy preclude any other
or future exercise thereof or the exercise of any other power, right or remedy.
CONDITIONS PRECEDENT
Conditions Precedent to each Sale. Each sale and/or contribution of
Receivables shall be subject to the conditions precedent that:
the Effective Date under the Receivables Financing Agreement
shall have occurred and, unless the Receivables are to be contributed
to the Purchaser, the conditions to the making of the related Advance
pursuant to Section 7.2 and/or 7.3 (as the case may be) of the
Receivables Financing Agreement shall have been satisfied or waived.
the Seller shall, to the extent required by Section 8.2 of the
Receivables Financing Agreement, have deposited in the Collection
Account all collections received after the Relevant Cutoff Date with
respect to the Receivables to be sold on such Transfer Date;
10
the Seller shall take any action (including, but not limited
to, the filing of appropriate UCC financing statements) required to
perfect the ownership interest of the Purchaser in the Receivables and
the Other Conveyed Property (provided, however, that the Seller shall
make such filings as promptly as possible and in no event later than
the third Business Day following the respective Receivables Transfer
Date and shall promptly provide to each of the Purchaser and the
Collateral Agent and the Agent a copy of a stamped acknowledgement copy
thereof); and
such sale or contribution shall be reflected on the books and
records of the Borrower pursuant to Section 2.2.
MISCELLANEOUS
Liability of Seller. Seller shall be liable in accordance herewith only
to the extent of the obligations in this Agreement specifically undertaken by
the Seller and the representations and warranties of the Seller.
Merger or Consolidation of the Seller. Any corporation or other entity
(i) into which the Seller may be merged or consolidated, (ii) resulting from any
merger or consolidation to which the Seller is a party or (iii) succeeding to
the business of the Seller shall execute an agreement of assumption to perform
every obligation of the Seller under this Agreement and, whether or not such
assumption agreement is executed, shall be the successor to the Seller hereunder
(without relieving the Seller of its responsibilities hereunder, if it survives
such merger or consolidation) without the execution or filing of any document or
any further action by any of the parties to this Agreement; provided, however,
that any such merger or consolidation is subject in all respects to the
restrictions set forth in its articles of incorporation and the consent of the
Agent (which consent shall not be unreasonably withheld).
Limitation on Liability of the Seller and Others. The Seller and any
director, officer, employee or agent thereof may rely in good faith on the
advice of counsel or on any document of any kind prima facie properly executed
and submitted by any Person respecting any matters arising under this Agreement.
The Seller shall not be under any obligation to appear in, prosecute or defend
any legal action that is not incidental to its obligations under this Agreement
or its Transaction Documents.
Amendment.
This Agreement may be amended by the Seller and Purchaser
(with the consent of the Agent) without the consent of the Collateral
Agent (i) to cure any ambiguity (ii) to correct any provisions in this
Agreement or (iii) at any such time as the Receivable Financing
Agreement has been terminated and no longer in effect; provided,
however, that such action shall not adversely affect the interests of
any Secured Party.
This Agreement may also be amended from time to time by the
Seller and Purchaser with the consent of the Collateral Agent and the
Agent, in accordance with the Receivables Financing Agreement.
11
Notices. All demands, notices and communications to the Seller or
Purchaser hereunder shall be in writing, personally delivered, or sent by
telecopier (subsequently confirmed in writing), reputable overnight courier or
mailed by certified mail, return receipt requested, and shall be deemed to have
been given upon receipt (a) in the case of the Seller, to Mercury Finance
Company LLC, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Treasurer, or (b) in the case of Purchaser, to MFN Funding LLC, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Treasurer, or such other
address as shall be designated by a party in a written notice delivered to the
other party or to the Collateral Agent, as applicable.
Merger and Integration. Except as specifically stated otherwise herein,
this Agreement and Transaction Documents set forth the entire understanding of
the parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement and the Transaction Documents.
This Agreement may not be modified, amended, waived or supplemented except as
provided herein.
Severability of Provisions. If any one or more of the covenants,
provisions or terms of this Agreement shall be for any reason whatsoever held
invalid, then such covenants, provisions or terms shall be deemed severable from
the remaining covenants, provisions or terms of this Agreement and shall in no
way affect the validity or enforceability of the other provisions of this
Agreement.
Intention of the Parties. The execution and delivery of this Agreement
shall constitute an acknowledgment by the Seller and Purchaser that they intend
that the assignments and transfers herein contemplated constitute a sale and/or
contribution, transfer and assignment outright, and not for security, of the
Receivables and the Other Conveyed Property, conveying good title thereto free
and clear of any Liens, from the Seller to Purchaser, and that the Receivables
and the Other Conveyed Property shall not be a part of the Seller's estate in
the event of the bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding, or other proceeding under any federal or state
bankruptcy or similar law, or the occurrence of another similar event, of, or
with respect to, the Seller. In the event that such conveyance is determined to
be made as security for a loan made by Purchaser or the Secured Parties to the
Seller, the parties intend that the Seller shall have granted to Purchaser a
security interest in all of the Seller's right, title and interest in and to the
Receivables and the Other Conveyed Property conveyed pursuant to Section 2.1
hereof, and that this Agreement shall constitute a security agreement under
applicable law.
Governing Law. This Agreement shall be construed in accordance with the
laws of the State of New York without regard to the principles of conflicts of
laws thereof and the obligations, rights and remedies of the parties under this
Agreement shall be determined in accordance with such laws.
Counterparts. For the purpose of facilitating the execution of this
Agreement and for other purposes, this Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and all of which counterparts shall constitute but one and the same
instrument.
12
Conveyance of the Receivables and the Other Conveyed Property to the
Collateral Agent. The Seller acknowledges that Purchaser intends, pursuant to
the Receivables Financing Agreement and the Security Agreement, to pledge the
Receivables and the Other Conveyed Property, together with its rights under this
Agreement, to the Collateral Agent on the Transfer Dates. The Seller
acknowledges and consents to such conveyance and pledge and waives any further
notice thereof and covenants and agrees that the representations and warranties
of Seller contained in this Agreement and the rights of Purchaser hereunder are
intended to benefit the Agent, the Collateral Agent and the Secured Parties. In
furtherance of the foregoing, the Seller covenants and agrees to perform its
duties and obligations hereunder, in accordance with the terms hereof for the
benefit of the Collateral Agent and the Secured Parties and that,
notwithstanding anything to the contrary in this Agreement, the Seller shall be
directly liable to the Collateral Agent and the Secured Parties, and that the
Collateral Agent and the Agent may enforce the duties and obligations of the
Seller under this Agreement against the Seller for the benefit of the Secured
Parties and the Collateral Agent.
Nonpetition Covenant. Neither the Purchaser nor the Seller (in its
capacity as a creditor of MFN Funding) shall petition or otherwise invoke the
process of any court or government authority for the purpose of commencing or
sustaining an involuntary case against MFN Funding or the Collateral Agent under
any federal or state bankruptcy, insolvency or similar law or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of MFN Funding or the Collateral Agent or any substantial part
of their respective property, or ordering the winding up or liquidation of the
affairs of MFN Funding or the Collateral Agent. This Section 7.12 shall be
continuing and shall survive any termination of this Agreement.
[Signature Pages Follow]
13
IN WITNESS WHEREOF, the parties have caused this Sale and Contribution
Agreement to be duly executed by their respective officers as of the day and
year first above written.
MFN FUNDING LLC,
as Purchaser
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇ ▇.
▇▇▇▇
Title: President
MERCURY FINANCE COMPANY LLC,
as Seller
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇
▇▇▇▇▇▇
Title: President
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Collateral Agent
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
Title: Vice
President
S-1
EXHIBIT A
---------
FORM OF SUPPLEMENT
ASSIGNMENT No. [ ] made this day of , 200 , among Mercury
Finance Company LLC, a Delaware limited liability company (the "Seller"), and
MFN Funding, a Delaware limited liability company (the "Purchaser").
W I T N E S S E T H:
WHEREAS, the Seller wishes to sell and/or contribute
Receivables to the Purchaser; and
WHEREAS, the Purchaser is willing to purchase or acquire as a
contribution such Receivables subject to the terms and conditions hereof.
NOW, THEREFORE, the Purchaser and the Seller hereby agree as
follows:
Defined Terms. Capitalized terms used herein shall
have the meanings ascribed to them in the Sale and
Contribution Agreement, dated as of March 1, 2001 (the "Sale
and Contribution Agreement"), unless otherwise defined herein.
"Relevant Cutoff Date" shall mean, with respect to the
Receivables sold and/or contributed hereby, , 200 .
"Transfer Date" shall mean, with respect to the Receivables
assigned hereby, the date hereof.
Schedules of Receivables. Annexed hereto is Schedule
A (in the form of an electronic tape) from the Seller listing
the Receivables sold and/or contributed by it pursuant to this
Supplement on the Transfer Date.
Sale and/or Contribution of Receivables. (A) The
Seller does hereby sell and/or contribute, transfer, assign,
set over and otherwise convey to the Purchaser (the
"Assignment"), without recourse (except as expressly provided
in the Sale and Contribution Agreement), all right, title and
interest of the Seller in and to:
the Receivables listed in Schedule A (or on the electronic tape
submitted with this supplement) hereto and all monies paid or payable thereon on
and after the Relevant Cutoff Date;
the security interests in the related Financed Vehicles granted by
Obligors pursuant to such Receivables and any other interest of the Seller in
such Financed Vehicles;
all proceeds and all rights to receive proceeds with respect to the
Receivables from claims on any physical damage, credit life or disability
insurance policies or Collateral Insurance (if any), covering Financed Vehicles
or Obligors;
A-1
all rights of the Seller (x) against Dealers pursuant to Dealer
Agreements or Dealer Assignments and (y) against third party lenders pursuant to
the related purchase agreements with the Seller with respect to any Receivable;
all rights under any service contracts on the related Financed
Vehicles;
the related Receivables Files; and
all proceeds of any and all of the foregoing.
The Assignment is in consideration of
the Purchaser's delivery to or upon
the order of the Seller of the
purchase price proceeds set forth in
Schedule A and an increase in the
Purchaser's capital account in an
amount equal to the amount set forth
on Schedule A.
Representations and Warranties of the Seller. The
Seller hereby represents and warrants to the Purchaser as of
the Transfer Date that:
Sale and Contribution Agreement. The
representations and warranties set
forth in the Sale and Contribution
Agreement are true and correct and
any representation in the Sale and
Contribution Agreement that relates
to Receivables or Other Conveyed
Property is true and correct and
made with respect to the related
Receivables and Other Conveyed
Property sold and/or contributed
pursuant to Section 3 hereof.
Principal Balance. As of the Relevant Cutoff
Date, the aggregate face amount of
the Receivables sold and contributed
to the Borrower under this
Supplement is set forth or listed on
Schedule A (or in the electronic
tape submitted with this
Supplement).
Conditions Precedent. The obligation of the
Purchaser to acquire the Receivables hereunder is
subject to the satisfaction, on or prior to the Transfer Date,
of the following conditions precedent:
Representations and Warranties. Each of the
representations and warranties made
by the Seller in Section 4 of this
Supplement and in Section 3.1 of the
Sale and Contribution Agreement
shall be true and correct with
respect to the property sold and/or
contributed pursuant to Section 3
hereof as of the Transfer Date.
Sale and Contribution Agreement
Conditions. Each of the conditions
set forth in Section 6.1 of the Sale
A-2
and Contribution Agreement shall
have been satisfied with respect to
the property sold pursuant to
Section 3 hereof.
Additional Information. The Seller shall
have delivered to the Purchaser such
information as was reasonably
requested by the Purchaser to
satisfy itself as to the
satisfaction of the conditions set
forth in this Section 5.
Ratification of Agreement. As supplemented by this
Supplement, the Sale and Contribution Agreement is in all
respects ratified and confirmed and the Sale and Contribution
Agreement as so supplemented by this Supplement shall be read,
taken and construed as one and the same instrument.
Counterparts. This Supplement may be executed in two
or more counterparts (and by different parties in separate
counterparts), each of which shall be an original but all of
which together shall constitute one and the same instrument.
GOVERNING LAW. THIS SUPPLEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-3
IN WITNESS WHEREOF, the Purchaser and the Seller have caused
this Supplement to be duly executed and delivered by their respective duly
authorized officers as of the day and the year first above written.
MFN FUNDING LLC,
as Purchaser
By
Name:
Title:
MERCURY FINANCE COMPANY, LLC
as Seller
By
Name:
Title:
Acknowledged:
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
solely in its capacity as Collateral Agent
By___________________________________________________
Name:
Title:
A-4
SCHEDULE A TO SUPPLEMENT
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