REFERRAL AGREEMENT
This Referral Agreement ("Agreement") is made as of February 26, 1998,
by and between U.S. Bank, N.A., a national banking association ("Bank") and Auto
Credit Clearinghouse ("ACCH"), a division of National Auto Finance Company,
Inc., a Delaware corporation ("NAFI").
WITNESSETH:
A. WHEREAS, ACCH engages in the business of purchasing, securitizing and
servicing non-prime motor vehicle retail installment sale contracts
originated by automobile dealers and/or banks;
B. WHEREAS, Bank receives credit applications of borrowers from automobile
dealers and finances motor vehicle retail installment sale contracts to
approved borrowers but generally does not finance non-prime motor
vehicle retail installment sale contracts;
B. WHEREAS, Bank desires to introduce ACCH to those Dealers in its trading
area for whom Bank provides consumer financing in exchange for a fee
based on the number of contracts made by ACCH with respect to the
credit applications referred to ACCH by Dealers that Bank refers or
introduces to ACCH; and
D. WHEREAS, ACCH desires to receive such referrals and introductions and
to pay such fee, all on the terms and conditions provided herein.
NOW THEREFORE, in consideration of the foregoing premises and the
mutual agreements and covenants contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending legally to be bound, hereby agree as follows:
SECTION 1. DEFINITIONS.
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Each of the following capitalized terms shall have the meaning set
forth below for purposes of this Agreement:
(a) "ACCH Program" means the program of ACCH by which ACCH
or any of its Affiliates solicits and evaluates Applications
and provides (or causes to be provided) financing,
constituting Referrals hereunder, to Dealers and their
customers for the purchase of Motor Vehicles, and the
marketing, training and other activities described herein
related to such financing, as such program may be modified
from time to time by ACCH.
(b) "Affiliate" of a specified Person means any other
Person who (i) directly or indirectly controls, is controlled
by, or is under common control with, such specified Person;
(ii) owns or controls either ten percent (10%) or more of the
outstanding voting stock or other voting equity or beneficial
interests of such specified Person or twenty percent (20%) or
more of the value of the total outstanding stock or other
equity securities of such specified Person determined on a
fully-diluted basis; (iii) is an officer, director, general
partner, trustee, manager, administrator, representative or
agent or owns or controls ten percent (10%) or more of the
outstanding voting interest of such other Person described in
clause (i), (ii) or (iii) of this sentence, except that
neither Bank (or any of its Affiliates) nor ACCH (or any of
its Affiliates) shall be considered an Affiliate of such other
party (or the Affiliates of such other party). For purposes of
the preceding sentence, "control" of a Person means
possession, directly or indirectly (through one or more
intermediaries), of the power to direct or cause the direction
of management and policies of such Person through ownership of
voting securities (or other ownership interest), contract,
voting trust or otherwise.
(c) "Application" means a credit application by a potential
purchaser of a Motor Vehicle that is submitted directly to
ACCH by a Dealer for financing of such Motor Vehicle.
(d) "Business Day" means any day other than Saturday,
Sunday or any other day on which national banking associations
in the State of Florida generally are closed for commercial
banking business.
(e) "Contract" means any non-prime Motor Vehicle retail
installment sale contract originated by a Dealer.
(f) "Dealer" means any Motor Vehicle dealer (1) from whom
Bank now or hereafter purchases Contracts or now or hereafter
receives Applications, (2) which has entered, or hereafter
enters, into a Dealer Agreement with Bank and such Dealer
Agreement has not been canceled, expired by its terms, or
otherwise terminated and (3) which is approved by ACCH as
constituting a "Dealer" under this Agreement and which has
signed a Dealer Agreement with ACCH.
(g) "Dealer Agreement" means a legally valid and binding
written agreement by and between Bank and a Dealer which,
among other things, grants to Bank the right to purchase
Contracts from such Dealer.
(h) "Governmental Authority" means any foreign, federal,
state or local government, political subdivision or
governmental or regulatory authority, agency, board,
commission, instrumentality or court or quasi-governmental
authority.
(i) "Law" or "Laws" means any or all federal, state or
local statutes, laws, codes, ordinances, judicial decisions,
proclamations, interpretive releases, regulations, published
requirements, orders, judgments, decrees and rules of any
Governmental Authority, in each case as amended and in effect
from time to time.
(j) "Licenses" means all material licenses, permits and
other authorizations issued by any Governmental Authority to
NAFI or ACCH which are used or useful in, or required for
implementation of, the ACCH Program.
(k) "Material Adverse Effect" means, with respect to a
particular Person, a material adverse change, effect or
development (or any change, effect or development that could
reasonably have a material adverse effect) on the assets,
business, revenues, expenses, operations, condition (financial
or otherwise), or prospects or ability to perform under or
with respect to the material contracts (including, for the
parties hereto, this Agreement) of the specified Person.
(l) "Motor Vehicle" means any automobile, sport utility
vehicle or light duty truck.
(m) " Non-Prime Applications" means those Applications that
satisfy, or reasonably appear to satisfy in the good faith
determination of a Dealer, the written credit criteria of ACCH
which is delivered by ACCH to a Dealer pursuant to this
Agreement, as such written credit criteria of ACCH may be
modified by ACCH from time to time in accordance with this
Agreement.
(n) "Person" means an individual, corporation, association,
partnership, joint venture, trust, estate, limited liability
company, limited liability partnership, Governmental Authority
or other entity or organization.
(o) "Referral" means any Contract which is actually funded
by ACCH with respect to which an Application was referred to
ACCH by a Dealer for such Contract.
SECTION 2. REFERRALS.
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Subject to the terms and conditions set forth in this Agreement, (i)
Bank shall encourage its Dealers to refer to ACCH all Non-Prime Applications, as
soon as possible after such applications are received by such Dealers, and (ii)
ACCH shall pay to Bank the amounts set forth in the attached Referral Fees
Payment Schedule, attached hereto as Schedule 1 for each Referral made which is
actually closed and funded by ACCH.
Notwithstanding anything to the contrary set forth in this Agreement,
ACCH may in its sole and absolute discretion choose to reject or not accept any
particular Application or Referral, and nothing in this Agreement shall be
construed to impose any funding requirement on ACCH with respect to any
Application or Referral.
SECTION 3. PURCHASE OF CONTRACTS.
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The parties hereto intend that all Contracts purchased with respect to
a Referral shall be made by ACCH and purchased directly by ACCH from the Dealers
or the Dealers' customers, as the case may be, and shall not be refinanced or
purchased from Bank or any of its Affiliates, or in any way be characterized as
being refinanced or purchased from Bank or any of its Affiliates, unless
otherwise authorized by ACCH.
SECTION 4. NO RECOURSE.
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All Referrals and any Contracts purchased by ACCH or any of its
Affiliates shall be without recourse to Bank or any of its Affiliates, and Bank
and its Affiliates shall not have any obligation or liability that is in any way
related to such Contracts; provided, however, that the parties hereto shall be
liable to each other for breach of their respective representations, warranties,
covenants and indemnities under the terms of this Agreement; provided, further,
that the obligations of Bank under this Agreement shall not constitute recourse
to Bank for the credit risk of any Contract purchased by ACCH or any Affiliate
of ACCH.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF ACCH.
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ACCH represents and warrants to Bank as follows:
(a) Organization and Standing. ACCH is a division of
National Auto Finance Company, Inc., a publicly held company
duly organized, validly existing and in good standing under
the laws of the State of Delaware, and duly qualified in each
jurisdiction where the conduct of the ACCH Program requires
such qualification.
(b) Authorization and Binding Obligation. ACCH has the full
power and authority to execute and deliver this Agreement and
to perform and comply with all terms, covenants and conditions
to be performed and complied with by ACCH hereunder. The
execution, delivery and performance of this Agreement by ACCH
has been duly and validly authorized by all necessary action
on the part of ACCH. This Agreement has been duly and validly
executed and delivered by ACCH and constitutes a legal, valid
and binding agreement of ACCH enforceable against ACCH in
accordance with its respective terms, except as the same may
be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws and related court decisions
of general applicability relating to or affecting creditors'
rights generally and by the application of general principles
of equity.
(c) Consents and Approvals; No Violation.
There is no requirement applicable to ACCH (that has
not been previously satisfied) to make any material filing
with, or to obtain any material permit, authorization, consent
or approval of, any Governmental Authority or other Person in
connection with the ACCH Program.
The execution, delivery and performance of this
Agreement by ACCH will not (i) violate, conflict with or
result in any breach of any provision of the organizational
documents of ACCH, (ii) violate, conflict with or result in a
breach or default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, deed of
trust, agreement, indenture, lease or other instrument or
obligation to which ACCH is a party or by which any of its
assets may be bound, or (iii) violate or conflict with, in any
material respect, any Law, order, writ, injunction, rule or
decree applicable to ACCH or any of its assets.
(d) Governmental Authorizations. All authorizations,
consents, orders and approvals of, or other action by, any
Governmental Authority that are required to be obtained by
ACCH, and all notices to and filing with any Governmental
Authority that are required to be made by ACCH, including in
the case of each of the foregoing those pertaining to the ACCH
Program and the execution of this Agreement, have been
obtained or made and are in full force and effect, except
where the failure to obtain or to make any such authorization,
consent order, approval, notice or filing, individually or in
the aggregate for all such failures, would not have a Material
Adverse Effect on ACCH. ACCH, as a division of National Auto
Finance Company, Inc., operates under the authority of the
Licenses, none of which is subject to any restriction or
condition which could materially adversely affect the ACCH
Program. The Licenses are valid for the full term thereof, are
in good standing and full force and effect and are not subject
to any liens, encumbrances, charges or other claims.
(e) Compliance with Laws. The operations of the ACCH
Program are in compliance in all respects with all Licenses
and all applicable Laws, except to the extent that any such
non- compliance, individually or in the aggregate, would not
have a Material Adverse Effect on ACCH or the ACCH Program.
(f) Litigation. Except in the ordinary course of the
recovery of obligations of third parties to ACCH, no action,
suit, litigation, arbitration, dispute, proceeding,
governmental investigation or governmental audit is pending
against, or to the knowledge of ACCH is threatened against,
ACCH or any of its assets or businesses that is reasonably
likely to have a Material Adverse Effect on the obligations of
ACCH contemplated by this Agreement.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF BANK.
--------------------------------------
Bank represents and warrants to ACCH as follows:
(a) Organization and Standing. Bank is a national banking
association duly organized, validly existing and in good
standing under the laws of the United States.
(b) Authorization and Binding Obligation. Bank has full
corporate power and authority to execute and deliver this
Agreement and to perform and comply with all terms, covenants
and conditions to be performed and complied with by it
hereunder. The execution, delivery and performance of this
Agreement by Bank have been duly and validly authorized by all
necessary corporate action on the part of Bank. This Agreement
has been duly and validly executed and delivered by Bank and
constitutes a legal, valid and binding agreement of Bank,
enforceable against Bank in accordance with its terms, except
as the same may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws and related
court decisions of general applicability relating to or
affecting creditors' rights generally and by the application
of general principles of equity.
(c) Consents and Approvals; No Violation.
There is no requirement applicable to Bank (that has
not been previously satisfied) to make any material filing
with, or to obtain any material permit, authorization, consent
or approval of, any Governmental Authority or other Person in
connection with the performance of the Bank's obligations set
forth in this Agreement.
The execution, delivery and performance of this
Agreement by Bank will not (i) violate, conflict with or
result in any breach of any provision of the organizational
documents of Bank, (ii) violate, conflict with or result in a
breach or default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, deed of
trust, agreement, indenture, lease or other instrument or
obligation to which Bank is a party or by which any of its
assets may be bound, or (iii) violate or conflict with, in any
material respect, any Law, order, writ, injunction, rule or
decree applicable to Bank or any of its assets.
(d) Governmental Authorizations. All authorizations,
consents, orders and approvals of, or other action by, any
Governmental Authority that are required to be obtained by
Bank, and all notices to and filing with any Governmental
Authority that are required to be made by Bank, including in
the case of each of the foregoing those pertaining to the
execution, delivery and performance of this Agreement, have
been obtained or made and are in full force and effect, except
where the failure to obtain or to make any such authorization,
consent order, approval, notice or filing, individually or in
the aggregate for all such failures, would not have a Material
Adverse Effect on Bank.
(e) Compliance with Laws. The execution and delivery of
this Agreement and the performance by Bank of its obligations
under this Agreement do not violate in any respects any
applicable Laws, except to the extent that any such violation,
individually or in the aggregate, would not have a Material
Adverse Effect on Bank.
(f) Litigation. No action, suit, litigation, arbitration,
dispute, proceeding, governmental investigation or
governmental audit is pending against, or to the knowledge of
Bank is threatened against, Bank or any of its assets or
businesses that is reasonably likely to have a Material
Adverse Effect on the obligations of Bank contemplated by this
Agreement.
(g) Dealers and Dealer Agreements. The receipt by Bank from
ACCH of a referral fee pursuant to the terms of this Agreement
with respect to each Referral constitutes, and shall
constitute, an express representation and warranty by Bank to
ACCH that the Dealer relating to such Referral satisfies each
of the conditions of a "Dealer" (as such conditions are set
forth in the definition of such term in this Agreement) as of
the date such Referral actually closed and was funded by ACCH.
SECTION 7. COVENANTS OF ACCH.
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So long as this Agreement remains in effect, ACCH shall perform and
comply with the covenants contained in this Section.
(a) Payment of Referral Fees. On or before the twentieth
(20th) day of each calendar month for the preceding calendar
month during the term of this Agreement, ACCH shall pay to
Bank the referral fees payable to the Bank for the previous
calendar month in accordance with the terms of this Agreement
and the Referral Fees Payment Schedule set forth on Schedule 1
attached hereto.
(b) Credit Criteria. ACCH shall deliver to Bank and to
Dealers the written credit criteria of ACCH which Dealers
shall utilize in determining whether a particular application
constitutes a Non-Prime Application. ACCH reserves the right
to modify and amend, from time to time, the written credit
criteria of ACCH by giving written notice to Bank and to
Dealers, which modified written credit criteria shall be
effective one Business Day after receipt by Bank and a
particular Dealer.
(c) Reports. ACCH shall maintain true and complete books
and records of account and shall comply with the following
delivery and notice requirements:
(i) ACCH shall maintain and implement,
or cause to be maintained and implemented,
administrative and operating procedures (including
records evidencing its Contracts and all Applications
reviewed by it) and shall keep and maintain, or cause
to be kept and maintained, all documents, books,
records, and other information which, in the
reasonable determination of Bank, are necessary or
advisable to monitor the results of the ACCH Program.
(ii)Each calendar month, ACCH shall
furnish to Bank, for each Dealer Bank refers to ACCH,
(a) the number of Applications delivered to ACCH for
the previous calendar month , (b) the disposition of
the Applications for the previous calendar month, (c)
details of funded Contracts, including dollars
booked, and (d) the number of Referrals occurring in
the previous calendar month.
(d) Inspection. At all reasonable times after written
notice within normal business hours, ACCH shall permit any
authorized representatives designated by Bank to visit and
inspect, conduct accounting reviews of, any of the properties
of ACCH and their books and records solely relating to the
ACCH Program, and to take abstracts therefrom and make copies
thereof, and to discuss ACCH's business, financial condition
and operations with the management and independent accountants
of ACCH, at Bank's sole cost and expense; provided, however,
that neither Bank nor any of its representatives shall conduct
any such inspection more than semi- annually.
(e) Compliance with Laws. ACCH shall comply in all respect
with all Licenses and all applicable Laws (including, without
limitation, all applicable commercial/consumer Laws), except
to the extent that any such non-compliance, individually or in
the aggregate, would not have a Material Adverse Effect on
ACCH or the ACCH Program.
SECTION 8. COVENANTS OF BANK.
-----------------
So long as this Agreement remains in effect, Bank shall perform and
comply with the covenants contained in this Section.
(a) Referral of Applications. Bank shall request that its
Dealers promptly refer to ACCH all Applications as soon as
possible after such Applications are received by such Dealer.
(b) Marketing. Bank shall use commercially reasonable
efforts to market the ACCH Program as part of, and in
connection with, the Bank's general marketing efforts to
Dealers and in connection with the marketing efforts of ACCH.
Without limiting the foregoing, the Bank shall cause its sales
representatives to introduce ACCH and the ACCH Program to each
of the Dealers in good standing with the Bank on or before 180
days after the date of this Agreement.
(c) Records and Reports. Bank shall furnish to ACCH such
information concerning Dealer financial and business affairs
(including without limitation sufficient information to verify
the representation and warranty of Bank set forth in Section
6(g) of this Agreement) as ACCH may request.
(d) Inspection. At all reasonable times after written
notice, the Bank shall permit any authorized representatives
designated by ACCH to visit and inspect, conduct accounting
reviews of, any of the properties of the Bank and its books
and records with respect to the Bank's obligations and
representations under this Agreement and to take abstracts
therefrom and make copies thereof, and to discuss Bank
affairs, finances and accounts with the management, employees
and independent accountants of Bank, at ACCH's sole cost and
expense; provided, however, that neither ACCH nor any of its
representatives shall conduct any such inspection more than
semi-annually.
(e) Compliance with Laws. Bank shall comply in all respect
with all applicable Laws (including, without limitation, all
applicable commercial/consumer Laws) with respect to the
performance of Bank's obligations under this Agreement, except
to the extent that any such non-compliance, individually or in
the aggregate, would not have a Material Adverse Effect on
Bank.
SECTION 9. JOINT COVENANTS OF BANK AND ACCH.
--------------------------------
So long as this Agreement remains in effect, Bank and ACCH shall each
use commercially reasonable efforts to cooperate in performing and complying
with the covenants contained in this Section.
(a) Plan. Bank and ACCH shall determine a plan for phased
implementation of the ACCH Program to Dealers in good standing
with Bank on or before 180 days of the date of this Agreement.
(b) Priority Order of Dealers. Bank and ACCH shall
determine the order of priority of Dealers to whom Bank sales
representatives should be introduced.
(c) Marketing. Bank and ACCH shall develop, market and
implement incentive programs, special promotions and related
sales and marketing devices, as appropriate, relating to the
ACCH Program.
(d) Confidentiality. The parties hereto acknowledge that
they have had, and may in the future have, access to certain
confidential and proprietary information of the other in
connection with or related to the ACCH Program or related to
the respective parties more generally, and such information
constitutes valuable, special and unique property of the
parties and shall be deemed to be confidential. This
information may only be used in the provision of services
under this Agreement. The parties hereto agree that they will
not, for any reason or purpose whatsoever, use or allow to be
used any such information or reveal or disclose any such
information to any Person other than the parties hereto and
those agents, employees and representatives thereof to the
extent that access to such information is necessary for a
particular agent, employee and representative to perform such
functions contemplated by this Agreement (who shall also agree
not to disclose such information except as permitted by this
Section 9(d), except (i) as expressly consented to by all of
the other parties, (ii) as required by Law, or (iii) is or
becomes generally available to the public under circumstances
which do not involve a breach of the terms hereof. Without
limiting the generality of the foregoing provisions of this
Section 9(d), except as required by Law, no party hereto shall
issue a press release or make other public (or private)
disclosure regarding the ACCH Program arising out of this
Agreement without the written consent of the other parties
hereto, which written consent shall not be unreasonably
withheld.
SECTION 10. TERMINATION OF AGREEMENT.
------------------------
(a) Termination. The term (the "Term") of this Agreement
shall be for an initial period of two (2) years from the date
hereof, automatically renewing for successive one-year terms
thereafter unless written notice of such non-renewal shall be
given by either party to the other at least sixty days prior
to the expiration of the then-current Term, except that this
Agreement shall be terminated prior thereto upon the happening
of any of the following events:
(i) at any time by mutual written
consent of Bank and ACCH;
(ii)at the Bank's election, if ACCH is
in default, breach or noncompliance in any respect of
its representations, warranties, covenants or
agreements under this Agreement and ACCH fails to
cure such default, breach or noncompliance after the
expiration of thirty (30) days after written notice
is received by ACCH from Bank;
(iii) at ACCH's election, if Bank is in
default, breach or noncompliance in any respect of
its representations, warranties, covenants or
agreements under this Agreement and Bank fails to
cure such default, breach or noncompliance after the
expiration of thirty (30) days after written notice
is received by Bank from ACCH;
(iv)after the expiration of 180 days
after the date of this Agreement, by either ACCH or
Bank by giving written notice to the other party,
provided that such termination shall not be effective
until the expiration of ninety (90) days after the
date of such written notice of termination; or
(v) if either party makes an assignment
for the benefit of creditors or admits in writing its
inability pay its debts when due, or if any
liquidation, dissolution, bankruptcy, reorganization,
insolvency, or other proceeding for the relief of
financially distressed debtors is commenced by or
against such party, or a receiver, liquidator,
custodian or trustee is appointed for such party or a
substantial part of such party's assets (but if any
of the foregoing occurs involuntarily, dissolution
shall not occur unless the same is not dismissed,
stayed or discharged within ninety (90) days), or if
an offer for relief is entered against such party
under Title 11 of the United States Code.
(b) Procedure and Effect of Termination. In the event of
termination of this Agreement by either or both of Bank and/or
ACCH pursuant to this Section (except for termination as a
result of the expiration of the Term, in which case this
Agreement shall terminate without any further action), prompt
written notice thereof shall forthwith be given to the other
party and this Agreement shall terminate without further
action by either party hereto; provided, however, that the
obligations of ACCH to make payments for Referrals made during
the previous month as required by Section 7 and to make such
reports regarding the previous month as required by Section 7
shall survive. If this Agreement is terminated as provided in
this Section 10, all written information received by a party
hereto with respect to the business of the other party or its
Affiliates or divisions (other than information which is a
matter of public knowledge at the time of disclosure to the
other party or which has been disclosed to the general public
by mutual agreement of the parties or which is required to be
filed as public information with any Governmental Authority)
shall not at any time be used for the advantage of, or
disclosed to third parties by, such party for any reason
whatsoever.
Notwithstanding anything to the contrary in this
Agreement, if either party is in default, breach or
noncompliance in any material respect of its representations,
warranties, covenants or agreements under this Agreement (and
such party fails to cure such default, breach or noncompliance
within the cure period set forth in this Section 10), then and
in that event, the other party shall have the right to seek
all remedies available to it as provided hereunder or at law
or equity.
In addition to such continuing obligations described
above in this Section 10(b), the termination of this Agreement
shall not discharge any party hereto from any obligation which
it owes to the other party immediately prior to or as a result
of such termination.
SECTION 11. INDEMNIFICATION.
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(a) ACCH Indemnification of Bank. ACCH shall indemnify and
hold harmless Bank, each of its successors and all partners,
owners, officers, directors, shareholders, employees and
agents of Bank and their respective Affiliates from and
against any loss, liability, expense, claim, damage or injury
suffered or sustained by reason of any acts, omissions or
alleged acts or omissions of ACCH and its Affiliates pursuant
to this Agreement arising out of or based on the arrangement
created by this Agreement and the activities of any such
Persons taken pursuant thereto, including, without limitation,
actions against Bank related to the Contracts, fees charged in
connection with the Contracts, the Applications or any
policies or procedures related to the Contracts or
Applications, including any judgment, award, settlement,
reasonable attorneys' fees and other costs or expense incurred
in connection with the defense of any actual or threatened
action, proceeding or claim or if any party to a Referral of
an Application alleges any actual or threatened action,
proceeding or claim against Bank alleging that the execution
of this Agreement as of the date first above written is in
violation of any state or federal statutes, laws or
regulations affecting the validity of this Agreement;
provided, however, that no indemnification shall be required
under this Section 11 if such acts, omissions or alleged acts
or omissions constitute violations of Law (unless such
violations of Law arose from acts or omissions of ACCH),
fraud, gross negligence or willful misconduct by Bank or its
Affiliates; and provided, further, that no indemnification
shall be required for any liabilities, cost or expense of Bank
and its Affiliates with respect to any federal, state or local
income or franchise taxes (or any interest or penalties with
respect thereto) required to be paid by Bank or any of its
Affiliates in connection herewith to any taxing authority. Any
indemnification under this Section 11 shall survive the
termination of this Agreement.
(b) Bank Indemnification of ACCH. Bank shall indemnify and
hold harmless ACCH, each of its successors and all partners,
owners, officers, directors, shareholders, employees and
agents of ACCH and their respective Affiliates from and
against any loss, liability, expense, claim, damage or injury
suffered or sustained by reason of any acts, omissions or
alleged acts or omissions of Bank and its Affiliates pursuant
to this Agreement arising out of or based on the arrangement
created by this Agreement and the activities of any such
Persons taken pursuant thereto, including, without limitation,
actions against ACCH related to the Contracts, the
Applications or any policies or procedures related to the
Contracts or Applications, including any judgment, award,
settlement, reasonable attorneys' fees and other costs or
expense incurred in connection with the defense of any actual
or threatened action, proceeding or claim or if any party to a
Referral of an Application by Bank alleges that the execution
of this Agreement as of the date first above written is in
violation of any state or federal statutes, laws or
regulations affecting the validity of the Agreement; provided,
however, that no indemnification shall be required under this
Section 11 if such acts,
omissions or alleged acts or omissions constitute violations
of Law, fraud, gross negligence or willful misconduct by
ACCH or its Affiliates; and provided, further, that no
indemnification shall be required for any liabilities, costs
or expense of ACCH and its Affiliates with respect to any
federal, state or local income or franchise taxes (or any
interest or penalties with respect thereto) required to be
paid by ACCH or any of its Affiliates in connection herewith
to any taxing authority. Any indemnification under this
Section 11 shall survive the termination of this Agreement.
SECTION 12. ASSIGNMENT.
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This Agreement and all of the provisions hereof shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns, but neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by either party without the
prior written consent of the other.
SECTION 13. GENERAL.
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(a) Entire Agreement. This Agreement embodies the entire
agreement and understanding of the parties hereto in respect
of the subject matters hereof. This Agreement supersedes all
prior negotiations, agreements and understandings between the
parties with respect to the subject matters hereof and all
letters of intent and other writings relating to such
negotiations, agreements and understandings.
(b) Notices. Any notice, demand or request required or
permitted to be given under the provisions of this Agreement
shall be in writing and delivered personally, by facsimile,
reputable overnight courier service or by registered or
certified mail to the following addresses, or to such other
address as any party may request by notifying the other
parties hereto:
To Bank:
U.S. Bank, N.A.
Dealer Financial Services
Mail Stop MPFP 1403
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000-0000 Telephone: (000) 000-0000
Attention: Xxxxx X.Xxxxxxx Facsimile: (000) 000-0000
To ACCH:
Auto Credit Clearinghouse
000 X.X. 00xx Xxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000 Telephone: (000) 000-0000
Attention: Xxxxx X. Xxxxxx Facsimile: (000) 000-0000
(c) Waiver. The failure of any party at any time to insist
upon strict performance of any promise, agreement, or
understanding set forth in this Agreement shall not be
construed as a waiver or relinquishment of the right to insist
upon strict performance of the same or any other promise,
agreement, or understanding at a future time.
(d) Rights of Third Parties. Nothing herein shall be
construed to be to the benefit of or enforceable by any Person
other than the parties hereto.
(e) Waiver of Trial by Jury. To the maximum extent
permitted by law, the parties hereby waive any right that they
may have to a trial by jury of any dispute (whether a claim in
tort, contract, equity or otherwise) arising under or relating
to this Agreement, and agree that any such dispute shall be
tried before a judge sitting without a jury.
(f) Damages. The extent of any liability to either party
under this Agreement shall not exceed the amount of the
consideration and referral fees received by the Bank under
this Agreement. Furthermore, incidental, consequential, and
punitive damages shall be prohibited.
(g) Legal Fees and Expenses. Should any of the parties
hereto institute any action or proceeding in court to enforce
any provision hereof or for damages by reason of any alleged
breach of any provision of this Agreement or for any other
judicial remedy, the prevailing party shall be entitled to
receive from the losing party all reasonable attorneys' fees
and all court costs in connection with said proceeding, except
that this Section 13(g) shall not apply in the context of an
indemnification under either Section 11 or 13(o). Except as
otherwise expressly provided in this Agreement, each party
will bear its respective expenses incurred in connection with
the preparation, execution, and performance thereby, including
all fees and expenses of agents, representatives, counsel and
accountants.
(h) Severability. If any provision of this Agreement or its
application to any party of circumstances shall be determined
by any court of competent jurisdiction to be invalid and
unenforceable to any extent, the remainder of this Agreement,
or the application of such provision to Persons or
circumstances other than those as to which it is so determined
invalid or unenforceable, shall not be affected thereby, and
each provision hereof shall be valid and shall be enforced to
the fullest extent permitted by law.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF MINNESOTA (WITHOUT REGARD TO ITS LAWS
PERTAINING TO CONFLICTS OF LAW) AS TO ALL MATTERS, INCLUDING
BUT NOT LIMITED TO MATTERS OF VALIDITY, CONSTRUCTION, EFFECT,
PERFORMANCE AND REMEDIES.
(j) Amendment and Modification. This Agreement may be
amended, modified or supplemented only by written agreement of
Bank and ACCH and their respective successors or assigns,
provided that this Section 13(j) may not be amended in any
circumstance.
(k) Headings. The headings are for convenience only and
shall not affect the meaning or construction of this
Agreement.
(l) No Partnership. The parties hereto do not intend by
this Agreement to create a joint venture, partnership or other
entity or any agency or representative relationship between or
among the parties, and no party hereto shall make any
representations (written or otherwise) that implies or
suggests that any such relationship exists.
(m) Arbitration. The term "disputes" includes, without
limitation, any disagreements between the parties pertaining
to this Agreement. If the parties hereto are unable to resolve
their disputes by negotiation, the parties hereto agree to
resolve their disputes by Arbitration. Either party may
commence Arbitration by sending a written Demand For
Arbitration to the American Arbitration Association ("AAA") by
registered or certified mail to the other party and to AAA, as
Arbitrator. The Demand For Arbitration must contain a
description of the dispute, the amount involved, and the
remedy sought. The Arbitrator must be an individual possessing
a current valid bar license and must be experienced in
automobile finance matters. The Arbitrator shall be selected
by agreement of the parties from lists supplied by AAA. If the
parties hereto are unable to agree, AAA will provide the names
of three (3) qualified Arbitrators, and each party shall
strike one (1) name. The remaining Arbitrator shall serve as
the Arbitrator in the Arbitration proceedings. The Arbitration
shall be conducted in a mutually agreeable location in
accordance with the Rules promulgated by AAA. The Arbitration
shall be conducted with the widest rights of discovery as
provided in applicable law by all parties, and each party
shall have the right to cross-examine the opposing party's
witnesses, either through legal counsel, expert witnesses or
both. As part of the Arbitrator's decision, the Arbitrator
shall allocate the costs of Arbitration, including fees of
attorneys and experts as he or she deems fair and equitable in
light of all relevant circumstances, including the costs of
in-house legal services provided on behalf of ACCH or Bank.
The decision of the Arbitrator shall be final, binding and
conclusive on all parties. The only ground for appeal shall be
that the Arbitrator committed an error or errors of law and
those grounds permitted for an appeal of a final arbitration
award under applicable law.
(n) Time of Essence. With regard to all dates and time
periods set forth or referred to in this Agreement, time is of
the essence.
(o) No Brokers. Each of ACCH and Bank hereby represent and
warrant to the other that it has not employed any agents,
finders, brokers or other such parties in connection with this
transaction. Each party hereby agrees to indemnify, defend and
hold the other harmless from and against any and all claims,
causes of action, losses, costs, expenses, damages or
liabilities, including reasonable attorneys' fees, court costs
and disbursements, which the other may sustain, incur or be
exposed to by reason of any claim or claims of all agents,
finders, brokers or other such parties claiming fees,
commissions or other compensation arising out of the acts or
omissions of the indemnifying party or claiming by, through or
under such indemnifying party. This indemnification is in
addition to and not in lieu of the indemnification set forth
in Section 11.
(p) Further Assurances. The parties agree (i) to furnish
upon request to each other such further information, (ii) to
execute and deliver to each other such other documents
reasonable acceptable to such party, and (iii) to do such
other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this
Agreement and the documents referred to in each of such
agreements.
(q) Counterparts; Facsimile Signatures. This Agreement may
be executed in counterparts, each of which, when so executed,
shall be deemed an original, and all such counterparts
together shall constitute one and the same instrument. Both
parties agree to accept a facsimile signature on this
Agreement as an execution signature.
IN WITNESS WHEREOF, the parties hereto have caused this Referral
Agreement to be signed by their duly authorized officers as of the date first
above written.
Auto Credit Clearinghouse, a division of
NATIONAL AUTO FINANCE COMPANY, INC.
By:
----------------------------
Name:
---------------------------
Title:
---------------------------
U.S. BANK, N.A.
By:
---------------------------
Name:
---------------------------
Title:
---------------------------
Schedule 1
PROPOSED REFERRAL FEES PAYMENT SCHEDULE
between
Auto Credit Clearinghouse, a Division of National Auto
Finance Company, Inc. ("ACCH")
and
U.S. Bank, N.A.
C. In any calendar month during the Term of the Referral Agreement, in the
event that ACCH actually closes and funds less than 51 Referrals in
such calendar month, then ACCH shall pay to Bank the sum of $175 per
Referral in such calendar month, which payment shall be made as set
forth in the Referral Agreement.
o In any calendar month during the Term of the Referral
Agreement, in the event that ACCH actually closes and funds
less than 51 Referrals with a funding ratio (contracts funded
to applications processed) of 10% or greater, ACCH shall pay
to Bank an additional sum of $25 per Referral, and if 20% or
greater, ACCH shall pay to Bank an additional sum of $25.
D. In any calendar month during the Term of the Referral Agreement, in the
event that ACCH actually closes and funds greater than 50 and less than
101 Referrals in such calendar month, then ACCH shall pay to Bank the
sum of $200 per Referral in such calendar month, which payment shall be
made as set forth in the Referral Agreement.
o In any calendar month during the Term of the Referral
Agreement, in the event that ACCH actually closes and funds
greater than 50 and less than 101 Referrals with a funding
ratio (contracts funded to applications processed) of 10% or
greater, ACCH shall pay to Bank an additional sum of $25 per
Referral, and if 20% or greater, ACCH shall pay to Bank an
additional sum of $25.
E. In any calendar month during the Term of the Referral Agreement, in the
event that ACCH actually closes and funds greater than 100 and less
than 151 Referrals in such calendar month, then ACCH shall pay to Bank
the sum of $225 per Referral in such calendar month, which payment
shall be made as set forth in the Referral Agreement.
o In any calendar month during the Term of the Referral
Agreement, in the event that ACCH actually closes and funds
greater than 100 and less than 151 Referrals with a funding
ratio (contracts funded to applications processed) of 10% or
greater, ACCH shall pay to Bank an additional sum of $25 per
Referral, and if 20% or greater, ACCH shall pay to Bank an
additional sum of $25.
F. In any calendar month during the Term of the Referral Agreement, in the
event that ACCH actually closes and funds greater than 150 Referrals in
such calendar month, then ACCH shall pay to Bank the sum of $275 per
Referral in such calendar month, which payment shall be made as set
forth in the Referral Agreement.
o In any calendar month during the Term of the Referral
Agreement, in the event that ACCH actually closes and funds
greater than 150 Referrals with a funding ratio (contracts
funded to applications processed) of 10% or greater, ACCH
shall pay to Bank an additional sum of $50 per Referral, and
if 20% or greater, ACCH shall pay to Bank an additional sum of
$25.
