Exhibit 4.5
FORM OF PURCHASE AGREEMENT dated as of August 1, 1998, between
FRANKLIN CAPITAL CORPORATION, a Delaware corporation (the
"Seller"), and FRANKLIN RECEIVABLES LLC, a Delaware limited
liability company (the "Purchaser").
WHEREAS in the regular course of its business, the Seller has
purchased certain non-prime motor vehicle retail installment sale contracts
secured by new and used automobiles and light trucks from motor vehicle dealers;
WHEREAS the Seller and the Purchaser wish to set forth the terms
pursuant to which the Receivables (as hereinafter defined) are to be sold by the
Seller to the Purchaser, which Receivables will be transferred by the Purchaser,
pursuant to the Sale and Servicing Agreement (as hereinafter defined), to
Franklin Auto Trust 1998-1 (the "Trust"), which Trust will issue two classes of
Asset Backed Notes (the "Notes"), which will be debt of the Trust and
Certificates representing the ownership interest in the Trust (the
"Certificates").
NOW, THEREFORE, in consideration of the foregoing, other good
and valuable consideration and the mutual terms and covenants contained herein,
the parties hereto agree as follows:
ARTICLE I
Certain Definitions
Terms not defined in this Agreement shall have the meaning set
forth in the Sale and Servicing Agreement. As used in this Agreement, the
following terms shall, unless the context otherwise requires, have the following
meanings (such meanings to be equally applicable to the singular and plural
forms of the terms defined):
"Agreement" shall mean this Purchase Agreement, as the same may
be amended and supplemented from time to time.
"Assignment" shall mean the document of assignment attached to
this Agreement as Exhibit A.
"Certificateholder" means a holder of a Certificate.
"Closing Date" shall mean August __, 1998.
"Collections" shall mean all amounts collected by the Servicer
(from whatever source) on or with respect to the Receivables.
"Computer Tape" means the computer tapes or other electronic
media furnished by the Seller to the Purchaser describing certain
characteristics of the Receivables.
"Lien" means a security interest, lien, charge, pledge, equity,
or encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to the respective Receivable by operation of law as a result of any
act or omission by the related Obligor.
"Noteholder" means a holder of a Note.
"Obligor" on a Receivable means the purchaser or co-purchasers
of the Financed Vehicle and any other Person who owes payments under the
Receivable.
"Prospectus" shall mean the Prospectus (as defined in the
Underwriting Agreement).
"Purchaser" shall mean Franklin Receivables LLC, a Delaware
limited liability company, its successors and assigns.
"Receivable" shall mean any Contract listed on Schedule A (which
Schedule may be in the form of microfiche).
"Repurchase Event" shall have the meaning specified in Section
6.02.
"Sale and Servicing Agreement" shall mean the Sale and Servicing
Agreement dated as of August 1, 1998, among the Trust, as issuer, Franklin
Receivables LLC, as seller, and Franklin Capital Corporation, as servicer and
representative, as the same may be amended and supplemented from time to time.
"Schedule of Receivables" shall mean the list of Receivables
annexed hereto as Schedule A.
"Security Insurer" shall mean MBIA Insurance Corporation.
"Seller" shall mean Franklin Capital Corporation., a Delaware
limited liability company, its successors and assigns.
"Underwriting Agreement" shall mean the Underwriting Agreement
dated August __, 1998 between Xxxxxxx, Xxxxx & Co. Inc. and the Purchaser.
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ARTICLE II
Conveyance of Receivables
SECTION 2.01. Conveyance of Receivables. In consideration of the
Purchaser's delivery to or upon the order of the Seller of $___________ the
Seller does hereby sell, transfer, assign, set over and otherwise convey to the
Purchaser, without recourse (subject to the obligations herein), all right,
title and interest of the Seller in and to:
(i) the Receivables, and all moneys received thereon after the
Cutoff Date;
(ii) an assignment of the security interests in the Financed
Vehicles granted by Obligors pursuant to the Receivables and any other interest
of the Seller in such Financed Vehicles;
(iii) any proceeds with respect to the Receivables from claims
on any physical damage, credit life or disability insurance policies covering
Financed Vehicles or Obligors and any proceeds from the liquidation of the
Receivables;
(iv) any proceeds from any Receivables repurchased by a Dealer,
pursuant to a Dealer Agreement, as a result of a breach of representation and
warranty in the related Dealer Agreement;
(v) all rights under any Service Contracts on the related
Financed Vehicles;
(vi) the related Receivables Files; and
(vii) the proceeds of any and all of the foregoing.
SECTION 2.02. RESERVED.
SECTION 2.03. The Closing. The sale and purchase of the
Receivables shall take place at a closing (the "Closing") at the offices of
Weil, Gotchal & Xxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 on the
Closing Date, simultaneously with the closings under the Sale and Servicing
Agreement.
ARTICLE III
Representations and Warranties
SECTION 3.01. Representations and Warranties of the Purchaser.
The Purchaser hereby represents and warrants to the Seller as of the date hereof
and as of the Closing Date:
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(a) Organization and Good Standing. The Purchaser 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 the power and authority
to own its properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and had at all
relevant times, and has, the power, authority and legal right to acquire and own
the Receivables.
(b) Due Qualification. The Purchaser is duly qualified to do
business and is in good standing, and has obtained all necessary licenses and
approvals, in all jurisdictions in which the ownership or lease of property or
the conduct of its business shall require such qualifications.
(c) Power and Authority. The Purchaser has the power and
authority to execute and deliver this Agreement and to carry out its terms and
the execution, delivery and performance of this Agreement has been duly
authorized by the Purchaser by all necessary action.
(d) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof do not
conflict with, result in any breach of any of the terms and provisions of, nor
constitute (with or without notice or lapse of time) a default under, the
certificate of formation or limited liability company agreement of the
Purchaser, or any indenture, agreement or other instrument to which the
Purchaser is a party or by which it is bound; nor result in the creation or
imposition of any Lien upon any of its properties pursuant to the terms of any
such indenture, agreement or other instrument (other than the Sale and Servicing
Agreement) nor violate any law or, to the best of the Purchaser's knowledge, any
order, rule or regulation applicable to the Purchaser of any court or of any
Federal or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Purchaser or its properties.
(e) No Proceedings. There are no proceedings or investigations
pending or, to the Purchaser's best knowledge, threatened, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Purchaser or its properties: (i) asserting the
invalidity of this Agreement, (ii) seeking to prevent the consummation of any of
the transactions contemplated by this Agreement or (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by the Purchaser of its obligations under, or the validity or
enforceability of, this Agreement.
SECTION 3.02. Representations and Warranties of the Seller. (a)
The Seller hereby represents and warrants to the Purchaser as of the date hereof
and as of the Closing Date:
(i) Organization and Good Standing. The Seller has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware, with the power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and had at all
relevant times, and has, the power, authority and legal right to acquire
and own the Receivables.
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(ii) Due Qualification. The Seller is duly qualified to do
business as a foreign corporation and is in good standing, and has
obtained all necessary licenses and approvals, in all jurisdictions in
which the ownership or lease of property or the conduct of its business
shall require such qualifications.
(iii) Power and Authority. The Seller has the power and
authority to execute and deliver this Agreement and to carry out its
terms; the Seller has full power and authority to sell and assign the
property sold and assigned to the Purchaser hereby and has duly
authorized such sale and assignment to the Purchaser by all necessary
corporate action; and the execution, delivery and performance of this
Agreement has been duly authorized by the Seller by all necessary
corporate action.
(iv) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof
shall not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of time)
a default under, the articles of incorporation or by-laws of the Seller,
or any indenture, agreement or other instrument to which the Seller is a
party or by which it is bound; nor result in the creation or imposition
of any Lien upon any of its properties pursuant to the terms of any such
indenture, agreement or other instrument (other than this Agreement);
nor violate any law or, to the best of the Seller's knowledge, any
order, rule or regulation applicable to the Seller of any court or of
any Federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Seller or its
properties.
(v) No Proceedings. To the Seller's best knowledge, there are no
proceedings or investigations pending, or threatened, before any court,
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties:
(A) asserting the invalidity of this Agreement, (B) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement, or (C) seeking any determination or ruling that might
materially and adversely affect the performance by the Seller of its
obligations under, or the validity or enforceability of, this Agreement.
(b) The Seller makes the following representations and
warranties as to the Receivables on which the Purchaser relies in accepting the
Receivables. Such representations and warranties speak as of the execution and
delivery of this Agreement, but shall survive the sale, transfer and assignment
of the Receivables to the Purchaser and the subsequent assignment and transfer
of the Receivables pursuant to the Sale and Servicing Agreement:
(i) Title. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from the
Seller to the Purchaser and that the beneficial interest in and title to such
Receivables not be part of the Seller's estate in the event of the filing of a
petition for receivership by or against the Seller under any bankruptcy law.
Immediately prior to the transfer and assignment herein contemplated, the Seller
had good and marketable title to each Receivable, free and clear of all Liens
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and, immediately upon the transfer thereof, the Purchaser shall have good and
marketable title to each such Receivable, free and clear of all Liens; and the
transfer of the Receivables to the Purchaser has been perfected under the UCC.
(ii) All Filings Made. All filings (including UCC filings) necessary
in any jurisdiction to give the Purchaser a perfected ownership interest in the
Receivables have been made.
(iii) Characteristics of Receivables. Each Receivable (a) was
originated in the United States of America by (i) a Dealer in connection with
the retail sale of a Financed Vehicle in the ordinary course of such Dealer's
business, was fully and properly executed by the parties thereto, and was
purchased by the Seller from such Dealer under an existing dealer agreement with
the Seller or (ii) the Seller or an affiliate of the Seller in the ordinary
course of its business and was fully and properly executed by the parties
thereto, (b) has created or shall create a valid, subsisting, and enforceable
first priority security interest in favor of the Seller in the Financed Vehicle,
which security interest shall be assignable by the Seller to the Purchaser,
which in turn shall be assignable to the Trust, (c) contains customary and
enforceable provisions such that the rights and remedies of the holder thereof
shall be adequate for realization against the collateral of the benefits of the
security, (d) provides for level monthly payments (provided that the payment in
the first or last month in the life of the Receivable may be minimally different
from the level payment) that fully amortize the Amount Financed by maturity, (e)
provides for, in the case of a Precomputed Receivable, in the event that such
Contract is prepaid, a prepayment that fully pays the Principal Balance and
includes interest to the date of payment, in the month of prepayment, at the
Annual Percentage Rate, and (f) has not been amended or collections with respect
to which have not been waived, other than as evidenced in the Receivable File
related thereto.
(iv) Schedule of Receivables. The information set forth in Schedule A
to this Agreement is true and correct in all material respects as of the close
of business on the Cutoff Date, and no selection procedures believed by the
Seller to be adverse to the Purchaser or the Security Insurer were utilized in
selecting the Receivables. The Computer Tape regarding the Receivables is true
and correct in all material respects as of the close of business on the Cutoff
Date.
(v) Compliance With Law. Each Receivable complied at the time it
was originated or made and at the Closing Date complies in all material respects
with all requirements of applicable Federal, state and local laws and
regulations thereunder, including usury laws, the Federal Truth-in-Lending Act,
the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the Fair Debt
Collection Practices Act, the Federal Trade Commission Act, the Xxxxxxxx-Xxxx
Warranty Act, the Xxxx-Xxxxxxxx Act, the Federal Reserve Board's Regulations B
and Z, and state adaptations of the National Consumer Act, and other consumer
credit laws and equal credit opportunity and disclosure laws.
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(vi) Binding Obligation. Each Receivable represents the legal,
valid and binding payment obligation in writing of the Obligor thereunder,
enforceable by the holder thereof in accordance with its terms except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
fraudulent conveyance, reorganization and similar laws now or hereafter in
effect related to or affecting creditors' rights generally and subject to
general principles of equity (whether applied in a proceeding at law or in
equity).
(vii) No Government Obligor. None of the Receivables are due
from the United States of America or any State or from any agency, department or
instrumentality of the United States of America or any State.
(viii) Security Interest in Financed Vehicle. Immediately prior
to the sale, assignment and transfer thereof, each Receivable is secured by a
validly perfected first priority security interest in the Financed Vehicle in
favor of the Seller as secured party or all necessary and appropriate actions
have been commenced that would result in the valid perfection of a first
security interest in the Financed Vehicle in favor of the Seller as secured
party. Immediately after the sale, assignment and transfer thereof to the
Purchaser, although the Lien Certificate will not indicate the Purchaser as
secured party, each Receivable will be secured by an enforceable and perfected
security interest in the Financed Vehicle in favor of the Purchaser as secured
party, which security interest is prior to all other Liens in such Financed
Vehicle.
(ix) Receivables in Force. No Receivable has been satisfied,
subordinated or rescinded, nor has any Financed Vehicle been released from the
Lien granted by the related Receivable in whole or in part unless another
vehicle has been substituted as collateral securing the Receivable without any
other modification to such Receivable.
(x) No Waiver. No provision of a Receivable has been waived
except as reflected in the Receivable File relating to such Receivable.
(xi) No Defenses. No right of rescission, setoff, counterclaim
or defense has been asserted or threatened with respect to any Receivable.
(xii) No Liens. The Seller has not received notice of any Liens
or claims, including Liens for work, labor, materials or unpaid state or federal
taxes relating to any Financed Vehicle securing the related Receivable, that are
or may be prior to or equal to the Lien granted by such Receivable.
(xiii) No Default. No Receivable has a payment that is more than
30 days delinquent as of the Cutoff Date, and, except as permitted in this
paragraph, no default, breach, violation or event (in any such case) permitting
acceleration under the terms of any Receivable has occurred; and no continuing
condition that with notice or the lapse of time would constitute a default,
breach, violation or event (in any such case) permitting acceleration under the
terms of any Receivable has arisen as of the Cutoff Date; and the Seller has not
waived and shall not waive any of the foregoing. For purposes of this clause
(xiii), a Receivable is considered 30 days delinquent as of the end of the month
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following the date on which a second consecutive Scheduled Payment has not been
made. As of the Closing Date no Receivable has had an uncured first payment
default.
(xiv) No Bankruptcies. No Obligor on any Receivable was noted in
the related Receivable File as having filed for bankruptcy in a proceeding which
remained undischarged as of the Cutoff Date.
(xv) No Repossessions. As of the Cutoff Date no Financed Vehicle
securing any Receivable is in repossession status.
(xvi) Chattel Paper. Each Receivable constitutes "chattel paper"
as defined in the UCC.
(xvii) Insurance. The Seller, in accordance with its customary
procedures, has determined that the Obligor, at the time the Receivable was
originated, obtained physical damage insurance covering the Financed Vehicle and
under the terms of the Receivable the Obligor is required to maintain such
insurance.
(xviii) Lawful Assignment. No Receivable has been originated in,
or as of the Cutoff Date is subject to the laws of, any jurisdiction under which
the sale, transfer and assignment of such Receivable or this Agreement is
unlawful, void or voidable.
(xix) No Insurance Premiums. No portion of the Principal Balance
of any Receivable included amounts attributable to the payment of any physical
damage or theft insurance premium.
(xx) One Original. There is only one original executed copy of
each Receivable.
(xxi) Location of Receivable Files. The Receivable Files are
kept at one or more of the locations listed in Schedule B.
(xxii) Computer Records. As of the Closing Date, the accounting
and computer records relating to the Receivables of the Seller will have been
marked to show the absolute ownership by the Purchaser of the Receivables.
(xxiii) Maturity of Receivables. Each Receivable has a final
maturity date not later than _______; each Receivable has an original term to
maturity of not more than __ months; the weighted average original term of the
Receivables is _____ months; and the weighted average remaining term of the
Receivables is ____ months as of the Cutoff Date. No Receivable shall have a
remaining term to maturity in excess of __ months except ____% of the Aggregate
Principal Balance of the Receivables represent Receivables with remaining terms
to maturity of up to __ months.
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(xxiv) Financing. Approximately ___% of the aggregate principal
balance of the Receivables, represent new vehicles; the remainder of the
Receivables represent used vehicles; approximately ___% of the aggregate
principal balance of the Receivables represent Precomputed Receivables and the
remainder of the Receivables represent Simple Interest Receivables; ___% of the
Receivables which are Precomputed Receivables are Rule of 78s Receivables. The
aggregate Principal Balance of the Receivables is $_______.
(xxv) APR. The weighted average Annual Percentage Rate of the
Receivables as of the Cutoff Date is approximately ___%. Each Receivable has an
APR equal to or greater than ___%.
(xxvi) Number. There are ___ Receivables.
(xxvii) Balance. Each Receivable has a remaining principal
balance of not less than $____ and not more than $____; the average Principal
Balance of the Receivables is $______.
(xxviii) Adverse Selection. No selection procedures adverse to
the Noteholders or the Certificateholders or the Security Insurer were utilized
in selecting the Receivables from those owned by the Servicer which met the
selection criteria contained in the Sale and Servicing Agreement.
(xxix) Taxes. To the best knowledge of the Seller, there are no
state or local taxing jurisdictions which have asserted that nonresident holders
of certificates in, or notes issued by, a trust which holds assets similar to
the assets to be held by the Trust are subject to the jurisdiction's income or
other taxes solely by reason of the location in the jurisdiction of the Owner
Trustee, the Seller, the Servicer, the Representative, the obligors on or the
assets securing the Receivables held by the Trust, or the issuer of a financial
guaranty insurance policy.
ARTICLE IV
Conditions
SECTION 4.01. Conditions to Obligation of the Purchaser. The
obligation of the Purchaser to purchase the Receivables is subject to the
satisfaction of the following conditions:
(a) Representations and Warranties True. The representations and
warranties of the Seller hereunder shall be true and correct on the Closing Date
with the same effect as if then made, and the Seller shall have performed all
obligations to be performed by it hereunder on or prior to the Closing Date.
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(b) Computer Files Marked. The Seller shall, at its own expense,
on or prior to the Closing Date, indicate in its computer files that receivables
created in connection with the Receivables have been sold to the Purchaser
pursuant to this Agreement, and deliver to the Purchaser the Schedule of
Receivables certified by the Chairman, the President, a Vice President or the
Treasurer to be true, correct and complete.
(c) Documents To Be Delivered by the Seller at the Closing.
(i) The Assignment. At the Closing, the Seller will execute and
deliver an Assignment. The Assignment shall be substantially in the form
of Exhibit A hereto.
(ii) Evidence of UCC Filing. On or prior to the Closing Date,
the Seller shall record and file, at its own expense, a UCC-l financing
statement in each jurisdiction in which required by applicable law,
executed by the Seller, as seller or debtor, and naming the Purchaser,
as purchaser or secured party, describing the Receivables and the other
property included in the Trust Property as collateral, meeting the
requirements of the laws of each such jurisdiction and in such manner as
is necessary to perfect the sale, transfer, assignment and conveyance of
such Receivables to the Purchaser. The Seller shall deliver a
file-stamped copy, or other evidence satisfactory to the Purchaser of
such filing, to the Purchaser on or prior to the Closing Date.
(iii) Other Documents. Such other documents as the Purchaser may
reasonably request.
(d) Other Transactions. The transactions contemplated by the
Sale and Servicing Agreement to be consummated on the Closing Date, shall be
consummated on such date.
SECTION 4.02. Conditions to Obligation of the Seller. The
obligation of the Seller to sell the Receivables to the Purchaser is subject to
the satisfaction of the following conditions:
(a) Representations and Warranties True. The representations and
warranties of the Purchaser hereunder shall be true and correct on the Closing
Date with the same effect as if then made, and the Seller shall have performed
all obligations to be performed by it hereunder on or prior to the Closing Date.
(b) Receivables Purchase Price. On the Closing Date, the
Purchaser shall have delivered to the Seller the purchase price specified in
Section 2.01 of this Agreement.
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ARTICLE V
Covenants of the Seller
The Seller agrees with the Purchaser as follows; provided,
however, that to the extent that any provision of this Article conflicts with
any provision of the Sale and Servicing Agreement, the Sale and Servicing
Agreement shall govern:
SECTION 5.01. Protection of Right, Title and Interest. (a)
Filings. The Seller shall cause all financing statements and continuation
statements and any other necessary documents covering the right, title and
interest of the Purchaser in and to the Receivables and the other property
included in the Trust Property to be promptly filed, and at all times to be kept
recorded, registered and filed, all in such manner and in such places as may be
required by law fully to preserve and protect the right, title and interest of
the Purchaser hereunder to the Receivables and the other property included in
the Trust Property. The Seller shall deliver to the Purchaser file stamped
copies of, or filing receipts for, any document recorded, registered or filed as
provided above, as soon as available following such recordation, registration or
filing. The Purchaser shall cooperate fully with the Seller in connection with
the obligations set forth above and will execute any and all documents
reasonably required to fulfill the intent of this paragraph.
(b) Name Change. Within 15 days after the Seller makes any
change in its name, identity or corporate structure which would make any
financing statement or continuation statement filed in accordance with paragraph
(a) above seriously misleading within the applicable provisions of the UCC or
any title statute, the Seller shall give the Purchaser notice of any such
change, and no later than 5 days after the effective date thereof, shall file
such financing statements or amendments as may be necessary to continue the
perfection of the Purchaser's interest in the property included in the Owner
Trust Estate.
SECTION 5.02. Other Liens or Interests. Except for the
conveyances hereunder and pursuant to the Sale and Servicing Agreement, the
Seller will not sell, pledge, assign or transfer to any Person, or grant,
create, incur, assume or suffer to exist any Lien on, any interest in, to and
under the Receivables, and the Seller shall defend the right, title and interest
of the Purchaser in, to and under the Receivables against all claims of third
parties claiming through or under the Seller; provided, however, that the
Seller's obligations under this Section shall terminate upon the termination of
the Trust pursuant to the Sale and Servicing Agreement.
SECTION 5.03. Chief Executive Office. During the term of the
Receivables, the Seller will maintain its chief executive office in Utah.
SECTION 5.04. Costs and Expenses. The Seller agrees to pay all
reasonable costs and disbursements in connection with the perfection, as against
all third parties, of the Purchaser's right, title and interest in and to the
Receivables.
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ARTICLE VI
Miscellaneous Provisions
SECTION 6.01. Obligations of Seller. The obligations of the
Seller under this Agreement shall not be affected by reason of any invalidity,
illegality or irregularity of any Receivable.
SECTION 6.02. Repurchase Events. The Seller hereby covenants and
agrees with the Purchaser for the benefit of the Purchaser, the Trust, the
Trustee, the Noteholders, the Certificateholders and the Security Insurer that
the occurrence of a breach of any of the Seller's representations and warranties
contained in Section 3.02(b) shall constitute events obligating the Seller to
repurchase Receivables hereunder ("Repurchase Events"), at the Purchase Amount
from the Purchaser or from the Trustee. The repurchase obligation of the Seller
shall constitute the sole remedy to the Purchaser, the Trust, the Trustee, the
Noteholders or the Certificateholders against the Seller with respect to any
Repurchase Event.
SECTION 6.03. Purchaser Assignment of Repurchased Receivables.
With respect to all Receivables repurchased by the Seller pursuant to this
Agreement, the Purchaser shall assign, without recourse, representation or
warranty, to the Seller all the Purchaser's right, title and interest in and to
such Receivables, and all security and documents relating thereto.
SECTION 6.04. [Reserved]
SECTION 6.05. Trust. The Seller acknowledges and agrees that (a)
the Purchaser will, pursuant to the Sale and Servicing Agreement, sell the
Receivables to the Trust and assign its rights under this Agreement to the
Trust, and (b) the representations and warranties contained in this Agreement
and the rights of the Purchaser under this Agreement, including those under
Section 6.02, are intended to benefit the Trust, the Noteholders, the
Certificateholders and the Security Insurer. The Seller hereby consents to all
such sales and assignments.
SECTION 6.06. Amendment. This Agreement may be amended from time
to time, with prior written notice to the Rating Agencies, by a written
amendment duly executed and delivered by the Seller and the Purchaser, without
the consent of the Noteholders, but with the consent of the Security Insurer for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the rights
of the Noteholders; provided that such amendment will not, in the Opinion of
Counsel satisfactory to the Trustee, materially and adversely affect the
interest of any Noteholder. This Agreement may also be amended by the Seller and
the Purchaser, with prior written notice to the Rating Agencies, with the
consent of the holders of Notes evidencing at least a majority of the
outstanding principal amount of the Notes for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of Noteholders and with
the consent of the Security Insurer; provided, however, that no such amendment
may (i) increase or reduce in any manner the amount of, or accelerate or delay
the timing of, collections of payments on Receivables or distributions that are
required to be made for the benefit of Noteholders or (ii) reduce the aforesaid
percentage of the Notes which are required to consent to any such amendment,
without the consent of the holders of all the outstanding Notes.
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SECTION 6.07. Accountants' Letters. (a) ________ will review the
characteristics of the Receivables described in the Schedule of Receivables set
forth as a Schedule hereto and will compare those characteristics to the
information with respect to the Receivables contained in the Offering Documents;
(b) the Seller will cooperate with the Purchaser and ______ in making available
all information and taking all steps reasonably necessary to permit such
accountants to complete the review set forth in clause (a) above and to deliver
the letters required of them under the Underwriting Agreement; (c) _______ will
deliver to the Purchaser a letter, dated the date of the Prospectus, in the form
previously agreed to by the Seller and the Purchaser, with respect to the
financial and statistical information contained in the Prospectus and with
respect to such other information as may be agreed in the form of letter.
SECTION 6.08. Waivers. No failure or delay on the part of the
Purchaser in exercising any power, right or remedy under this Agreement or any
Assignment shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power, right or remedy preclude any other or further
exercise thereof or the exercise of any other power, right or remedy.
SECTION 6.09. Notices. All demands, notices and communications
under this Agreement shall be in writing, personally delivered or mailed by
certified mail, return receipt requested, and shall be deemed to have been duly
given upon receipt (a) in the case of the Seller, to 00 Xxxx 000 Xxxxx, Xxxxx
000, Xxxx xxxx Xxxx, XX 00000, Attention: _______, (b) in the case of the
Purchaser, to 00 Xxxx 000 Xxxxx, Xxxxx 000, Xxxx xxxx Xxxx, XX 00000, Attention:
_______, (c) in the case of Moody's, to Xxxxx'x Investors Service, Inc., ABS
Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; (d) in the
case of Standard & Poor's, to Standard & Poor's Corporation, 00 Xxxxxxxx (00xx
Xxxxx), Xxx Xxxx, Xxx Xxxx 00000, Attention of Asset Backed Surveillance
Department; (e) in the case of the Security Insurer, to MBIA Insurance
Corporation, 000 Xxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000, Attn: Insured Portfolio
Management (IPM-SF), or as to each of the foregoing, at such other address as
shall be designated by written notice to the other parties.
SECTION 6.10. Costs and Expenses. The Seller will pay all
expenses incident to the performance of its obligations under this Agreement and
the Seller agrees to pay all reasonable out-of-pocket costs and expenses of the
Purchaser, excluding fees and expenses of counsel, in connection with the
perfection as against third parties of the Purchaser's right, title and interest
in and to the Receivables and the enforcement of any obligation of the Seller
hereunder.
SECTION 6.11. Representations of the Seller and the Purchaser.
The respective agreements, representations, warranties and other statements by
the Seller and the Purchaser set forth in or made pursuant to this Agreement
shall remain in full force and effect and will survive the closing under Section
2.03.
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SECTION 6.12. Confidential Information. The Purchaser agrees
that it will neither use nor disclose to any Person the names and addresses of
the Obligors, except in connection with the enforcement of the Purchaser's
rights hereunder, under the Receivables, under the Sale and Servicing Agreement
or as required by any of the foregoing or by law.
SECTION 6.13. Headings and Cross-References. The various
headings in this Agreement are included for convenience only and shall not
affect the meaning or interpretation of any provision of this Agreement.
References in this Agreement to Section names or numbers are to such Sections of
this Agreement.
SECTION 6.14. GOVERNING LAW. THIS AGREEMENT AND THE ASSIGNMENTS
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 OR THEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 6.15. Counterparts. This Agreement may be executed in
two or more counterparts and by different parties on separate counterparts, each
of which shall be an original, but all of which together shall constitute one
and the same instrument.
SECTION 6.16. Third Party Beneficiary. The Security Insurer is
an express third party beneficiary of this Agreement.
SECTION 6.17. No Proceedings. So long as this Agreement is in
effect, and for one year following its termination, the Seller agrees that it
will not file any involuntary petition or otherwise institute any bankruptcy,
reorganization arrangement, insolvency or liquidation proceeding or other
proceedings under any federal or state bankruptcy law or similar law against the
Purchaser.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers duly authorized as of the
date and year first above written.
FRANKLIN RECEIVABLES LLC
By: __________________________
Name:
Title:
FRANKLIN CAPITAL CORPORATION
By: __________________________
Name:
Title:
EXHIBIT A
ASSIGNMENT
For value received, in accordance with the Purchase Agreement
(the "Purchase Agreement") dated as of August 1, 1998, between the undersigned
and Franklin Receivables LLC (the "Purchaser"), the undersigned does hereby
sell, assign, transfer and otherwise convey unto the Purchaser, without
recourse, all right, title and interest of the undersigned in and to (i) the
Receivables and all monies received thereon, on or after the Cutoff Date; (ii)
the security interest of the Seller in the Financed Vehicles granted by the
Obligors pursuant to the and any other interest of the Seller in such Financed
Vehicles; (iii) the interest of the Seller in any proceeds from claims on any
physical damage, credit life or disability insurance policies relating to the
Financed Vehicles or Obligors; (iv) the interest of the Seller in any proceeds
with respect to the Receivables from recourse to Dealers thereon with respect to
which the Servicer has determined in accordance with its customary procedures
that eventual payment in full is unlikely; (v) all rights under any Service
Contract on the related Financed Vehicles; (vi) the related Receivables Files;
and (vii) the proceeds of any and all of the foregoing. The foregoing sale does
not constitute and is not intended to result in any assumption by the Purchaser
of any obligation of the undersigned to the Obligors, insurers or any other
person in connection with the Receivables, Receivable Files, any insurance
policies or any agreement or instrument relating to any of them.
This Assignment is made pursuant to and upon the
representations, warranties and agreements on the part of the undersigned
contained in the Purchase Agreement and is to be governed by the Purchase
Agreement. The undersigned acknowledges and agrees that the Purchaser may
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further assign the items enumerated in clauses (i) through (vii) above to
Franklin Auto Trust 1998-1 which may in turn assign its interests in the items
in (i) through (vii) to ____________, as trustee (the "Trustee") for the benefit
of the Noteholders and the Security Insurer and that the Trustee will have the
right to enforce any of the rights of the Purchaser under the Purchase
Agreement.
Capitalized terms used herein and not otherwise defined shall
have the meaning assigned to them in the Purchase Agreement.
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IN WITNESS WHEREOF, the undersigned has caused this Assignment
to be duly executed as of August 1, 1998.
FRANKLIN CAPITAL CORPORATION
By: _____________________________
Name:
Title:
A-3
SCHEDULE A
Schedule of Receivables
[Delivered to the Trustee at Closing]
SCHEDULE 1
Location of Receivable Files
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