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EXHIBIT 6.3
FINANCING AGREEMENT
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FINANCING AGREEMENT
This FINANCING AGREEMENT (the "Agreement") is dated as of September 6,
2000 among BANNER CENTRAL FINANCE COMPANY, a Delaware corporation ("Banner
Central Finance") and BANNER'S CENTRAL ELECTRIC, INC., a California corporation
("Banner's Central Electric").
WHEREAS, concurrently herewith, Central Financial Acceptance Corporation
("CFAC") has adopted a Plan of Complete Dissolution, Liquidation and
Distribution (the "Plan of Liquidation") pursuant to which CFAC will be
completely liquidated and dissolved;
WHEREAS, pursuant to the Plan of Liquidation, CFAC will distribute for
the benefit of its stockholders all of the issued and outstanding shares of
Hispanic Express, Inc. and Banner Central Finance, which are CFAC's wholly-owned
first tier subsidiaries; and
WHEREAS, as an integral part of the Plan of Liquidation, Banner's
Central Electric desires to grant Banner Central Finance the exclusive right to
purchase consumer finance receivables ("Consumer Finance Receivables") generated
by sales at Banner's Central Electric's stores, whether now in existence or
hereafter opened (the "Central Stores").
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and conditions herein contained, the parties agree as follows:
1. Exclusive Right to Purchase Consumer Finance Receivables.
(a) Exclusive Right. Banner's Central Electric hereby grants to
Banner Central Finance the exclusive right, to be exercised at Banner Central
Finance's sole option, (i) to purchase, without recourse, Consumer Finance
Receivables originated by Banner's Central Electric for sales at Central Stores,
or (ii) to provide financing directly to Banner's Central Electric's customers
for sales of merchandise at Central Stores. Banner's Central Electric agrees
that, so long as it originates Consumer Finance Receivables, Banner's Central
Electric will not offer any consumer credit except on such terms, conditions and
according to such underwriting criteria as may be directed by Banner Central
Finance from time to time, and, if Banner Central Finance shall originate
Consumer Finance Receivables directly to Banner's Central Electric's customers,
Banner's Central Electric agrees that it will not offer any consumer credit
without the prior written consent of Banner Central Finance.
(b) Inventory and Inventory Financing. During the term of this
Agreement, Banner Central Finance shall be committed to provide a maximum
aggregate amount of $6 million of inventory or inventory financing to Banner's
Central Electric, as may be requested by Banner's Central Electric from time to
time.
(c) Floor Space. In consideration of Banner Central Finance
acquiring consumer finance receivables and providing inventory financing,
Banner's Central Electric shall provide Banner Central Finance at no charge,
such amount of space at Central Stores as Banner Central Finance may from time
to time reasonably request.
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2. Term. This Agreement shall be in effect for a period of 10 years from
the date first set forth above, subject to termination by Banner Central Finance
or Banner's Central Electric upon twelve month's prior written notice.
3. Representations and Warranties of Banner's Central Electric. Banner's
Central Electric represents and warrants as follows:
(a) All forms of installment sales contracts and promissory notes
presently in use or proposed for use by Banner's Central Electric comply with
all applicable laws, including, without limitation, all applicable consumer
finance laws.
(b) Banner's Central Electric has the full capacity, right, power
and authority to enter into this Agreement and any related agreements to which
it is a party. The execution, delivery and performance of this Agreement by
Banner's Central Electric and the execution, delivery and performance of any
related agreements or contemplated transactions by Banner's Central Electric
will not violate, or constitute a breach or default (whether upon lapse of time
and/or the occurrence of any act or event or otherwise) under, the articles of
incorporation or bylaws of Banner's Central Electric, or any material contract
of Banner's Central Electric or violate any laws or regulations. No permits or
approvals are required to be obtained by Banner's Central Electric to consummate
the transactions contemplated by this Agreement. The execution and delivery of
this Agreement by Banner's Central Electric and the performance of this
Agreement and any related or contemplated transactions by Banner's Central
Electric will not require filing or registration with, or the issuance of any
permit by, any other third party or governmental entity.
(c) Banner's Central Electric holds all material permits that are
required by any governmental entity to permit it to conduct its business as now
conducted. To the best knowledge of Banner's Central Electric no suspension,
cancellation or termination of any of such permits is threatened or imminent.
(d) Banner's Central Electric is organized and has conducted its
business in accordance with applicable laws in all material respects including
the California Retail Installment Credit Act, and the forms, procedures and
practices of Banner's Central Electric including, its installment credit
business are in compliance with all such laws, to the extent applicable, in all
material respects.
4. Independent Parties. The parties are independent parties engaged in
the operation of their respective businesses. No party has the authority to
enter into contracts or assume any obligations for any other party or is to be
considered as the agent or employee of any other party for any purpose
whatsoever. Nothing in this Agreement shall be construed to establish a
relationship of partners or joint venturers among the parties.
5. Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties and their respective successors and
permitted assigns. This Agreement may not be assigned or delegated by any party
without the consent of the other party.
6. Notices. All notices, requests, demands and other communications
provided for by this Agreement shall be in writing (including telecopier or
similar writing) and
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shall be deemed to have been given at the time when mailed in any general or
branch office of the United States Postal Service, enclosed in a registered or
certified postpaid envelope, or sent by Federal Express or other similar
overnight courier service, addressed to the appropriate party at 0000 Xxxx
Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxx 00000, Attention: Secretary, or to such
changed address as such party may have fixed by notice or, if given by
telecopier, when such telecopy is transmitted and the appropriate answer back is
received.
7. Governing Law. This Agreement shall be governed by the laws of the
State of California without giving effect to the principles of conflicts of law.
8. Entire Agreement. This Agreement sets forth the entire agreement
among the parties with respect to its subject matter. This Agreement may not be
amended or otherwise modified except in writing duly executed by all of the
parties. No waiver of any provision or breach of this Agreement shall be
effective unless such waiver is in writing and signed by the party against which
enforcement of such waiver is sought. A waiver by any party of any breach or
violation of this Agreement shall not be deemed or construed as a waiver of any
subsequent breach or violation thereof.
9. Severability. Should any part, term or condition hereof be declared
illegal or unenforceable or in conflict with any other law, the validity of the
remaining portions or provisions of this Agreement shall not be affected
thereby, and the illegal or unenforceable portions of the Agreement shall be and
hereby are redrafted to conform with applicable law, while leaving the remaining
portions of this Agreement intact.
10. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same document.
11. Headings. Section headings are for convenience only and do not
control or affect the meaning or interpretation of any terms or provisions of
this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
BANNER CENTRAL FINANCE COMPANY
By: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx,
Chief Executive Officer, Chief
Financial Officer and President
BANNER'S CENTRAL ELECTRIC, INC.
By: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx,
Chief Executive Officer
and President
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