EXHIBIT 4(f)(46)
INTERCREDITOR AGREEMENT
This Intercreditor Agreement (this "Agreement"), dated September 30,
2002, is among Credit Acceptance Corporation ("CAC"), CAC Warehouse Funding
Corp., CAC Funding Corp., Bank of America, N.A., as agent under the BofA
Securitization Documents (as hereinafter defined) ("BofA"), Wachovia Securities,
Inc., as agent under the Wachovia Securitization Documents (as hereinafter
defined) ("Wachovia"), Comerica Bank, as agent under the CAC Credit Facility
Documents (as hereinafter defined) ("Comerica"), and each other creditor who
becomes a party hereto after the date hereof.
BACKGROUND
A. Pursuant to the terms of the various Dealer Agreements between CAC
and the Dealers, Collections from a particular Pool are first used to pay
certain collection costs, CAC's servicing fee and to pay back the Pool's Advance
balance. After the Advance balance under such Pool has been reduced to zero, the
Dealer to whom the Pool relates has a contractual right under the related Dealer
Agreement to receive a portion of any further Collections with respect to the
Pool (such portion of further Collections otherwise payable to the Dealer is
referred to herein as "Back-end Dealer Payments"), subject to CAC's right of
offset as described in paragraph F below.
B. CAC has granted a security interest in CAC's rights with respect to
its Pools (to the extent not released) and related assets generally under the
CAC Credit Facility Documents to Comerica, as collateral agent for the banks
which are parties thereto.
C. CAC and BofA have entered into various transactions as set forth in
the BofA Securitization Documents (collectively, the "BofA Securitization")
pursuant to which the security interest with respect to certain specifically
identified Pools and related assets was released by Comerica, CAC contributed
such Pools and related assets to its wholly-owned subsidiary, CAC Funding Corp.,
and CAC Funding Corp. granted BofA a security interest in CAC Funding Corp.'s
rights to such Pools and related assets (such Pools and related assets are
referred to herein as the "BofA Pools").
D. CAC and Wachovia are entering into a transaction as set forth in the
Wachovia Securitization Documents (the "Wachovia Securitization") pursuant to
which the security interest with respect to certain specifically identified
Pools and related assets is being released by Comerica, CAC is contributing such
Pools and related assets to its wholly-owned subsidiary, CAC Warehouse Funding
Corp., and CAC Warehouse Funding Corp. is granting Wachovia a security interest
in CAC Warehouse Funding Corp.'s rights to such Pools and related assets (such
Pools and related assets are referred to herein as the "Wachovia Pools").
E. Comerica retains a security interest in Pools and related assets
which have not been released pursuant to the BofA Securitization and which are
not being released pursuant to the Wachovia Securitization (such unreleased
Pools and related assets are referred to herein as the "Comerica Pools").
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F. The Dealer Agreements permit CAC and its assignees, under certain
circumstances, to set off any Collections received with respect to any Pool of a
Dealer against Advances under other Pools of that Dealer.
G. The parties hereto acknowledge that the rights of CAC or its
assigns, pursuant to the Dealer Agreements, to set off Collections received with
respect to a Pool against the outstanding balance under any other Pool are not
intended, and should not be permitted, to be used to prejudice the collateral
position of any of the parties hereto, and therefore the exercise of such rights
should be limited to Back-end Dealer Payments.
In consideration of the mutual premises and promises set forth herein
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties agree as follows:
AGREEMENTS
1. Confirmation. Notwithstanding any statement or provision contained
in the Financing Documents or otherwise to the contrary, and irrespective of the
time, order or method of attachment or perfection of security interests granted
pursuant to the Financing Documents, respectively, or the time or order of
filing or recording of any financing statements, or other notices of security
interests, liens or other interests granted pursuant to the Financing Documents,
respectively, or the giving of or failure to give notice of the acquisition or
expected acquisition of purchase money or other security interests, and
irrespective of anything contained in any filing or agreement to which any
Creditor may now or hereafter be a party and irrespective of the ordinary rules
for determining priority under the Uniform Commercial Code or under any other
law governing the relative priorities of secured creditors, subject, however, to
the terms and conditions of this Agreement:
(a) RELEASE BY BOFA. BofA (i) releases any and all rights in and to any
Collections with respect to the Comerica Pools or the Wachovia Pools or in any
Back-end Dealer Payments; provided, that no release shall have been granted with
respect to amounts collected under any Pools which are Back-end Dealer Payments
that have been set off by CAC or by Comerica pursuant to the CAC Credit Facility
Documents against amounts owing under the BofA Pools, and (ii) relinquishes all
rights it has or may have to require CAC, individually or as servicer, any
successor servicer or CAC Funding Corp. to use Collections on its behalf
contrary to clause (a)(i). BofA agrees that the lien and security interest
granted to it pursuant to the BofA Securitization Documents does not and shall
not attach to any Comerica Pools or Wachovia Pools (or related Collections) or
to any Back-end Dealer Payments, and shall not assert any claim thereto.
(b) RELEASE BY WACHOVIA. Wachovia (i) releases any and all rights in
and to any Collections with respect to the Comerica Pools or the BofA Pools or
in any Back-end Dealer Payments; provided, that no release shall have been
granted with respect to amounts collected under any Pools which Back-end Dealer
Payments that have been set off by CAC or by Comerica pursuant to the CAC Credit
Facility Documents against amounts owing under the Wachovia Pools, and (ii)
relinquishes all rights it has or may have to require CAC, individually or as
servicer, any successor servicer or CAC Warehouse Funding Corp. to use
Collections on its
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behalf contrary to clause (b)(i). Wachovia agrees that the lien and security
interest granted to it pursuant to the Wachovia Securitization Documents to
which it is a party does not and shall not attach to any Comerica Pools or BofA
Pools (or related Collections) or to any Back-end Dealer Payments and shall not
assert any claim thereto.
(c) RELEASE BY COMERICA. Comerica (i) releases any and all rights in
and to any Collections with respect to the BofA Pools and the Wachovia Pools,
other than amounts collected under the BofA Pools or the Wachovia Pools which
are owed to Dealers as Back-end Dealer Payments and which are subject to set off
by CAC pursuant to the related Dealer Agreement and which have not been set off
by CAC or by Comerica pursuant to the CAC Credit Facility Documents against
amounts owing under the Wachovia Pools or the BofA Pools, and (ii) relinquishes
all rights it has or may have to require CAC, individually or as servicer, or
any successor servicer to use Collections on its behalf contrary to clause
(c)(i). Except for Back-end Dealer Payments to the extent provided in (c)(i),
Comerica agrees that the lien and security interest granted to it pursuant to
the CAC Credit Facility Documents does not and shall not attach to any BofA
Pools or Wachovia Pools and shall not assert any claim against the BofA Pools or
the Wachovia Pools or Collections related thereto.
2. Covenant of the CAC Entities.
(a) Each of the CAC Entities covenants that it shall not use any right
it may have under the Dealer Agreements, whether at the direction of Comerica,
BofA or Wachovia or otherwise, to set off any Collections, other than amounts
which are owed to Dealers as Back-end Dealer Payments, from one Pool against
amounts owed under another Pool encumbered in favor of another Creditor.
(b) Each of the CAC Entities covenants that it will require any other
person or entity which hereafter acquires any security interest in the Pools,
Dealer Agreements and related assets from a CAC Entity to become parties to this
Agreement by executing an amendment or acknowledgment, in form and substance
reasonably satisfactory to CAC and the Creditors, by which such persons or
entities agree to be bound by the terms of this Agreement, and delivering such
signed amendment or acknowledgement hereof to each of the CAC Entities and the
Creditors; provided, however, that in the event the amount owed by the CAC
Entities to any Creditor shall be reduced to zero and such Creditor shall have
no obligation or agreement to make any further advances to any CAC Entity, such
Creditor shall have no rights under this Section 2(b).
3. Turnover of Proceeds. The parties hereto agree that if, at any time,
a Creditor (a "Receiving Creditor") (x) receives any payment, distribution,
security or the proceeds thereof to which another Creditor or Creditors shall,
under the terms of Section 1 of this Agreement, be entitled and (y) the
Receiving Creditor either (A) had actual knowledge, at the time of such receipt,
that such payment, distribution or proceeds were wrongfully received by it or
(B) another Creditor or Creditors shall have given written notice to the
Receiving Creditor, prior to such receipt, of its good faith belief that such
payments, distributions or proceeds are being misapplied, and such notice
contains evidence reasonably satisfactory to the Receiving Creditor of such
misapplication then such Receiving Creditor shall receive and hold the same
separately
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and in trust for the benefit of, and shall forthwith pay over and deliver the
same to the relevant Creditor.
4. Further Assurances. Each Creditor and CAC Entity agrees that it
shall be bound by all of the provisions of this Agreement. Without limiting any
other provision hereof, each of the Creditors and CAC Entities agrees that it
will promptly execute such instruments, notices or other documents as may be
reasonably requested by any party hereto for the purpose of confirming the
provisions of this Agreement or better effectuating the intent hereof. CAC will
reimburse each Creditor for all reasonable expenses incurred by such Creditor
pursuant to this Section 4.
5. Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York without regard to its
conflicts of laws rules. Each of the parties hereto agrees to the non-exclusive
jurisdiction of any federal court located within the State of New York. Each of
the Parties hereto hereby waives any objection based on forum non conveniens,
and any objection to venue of any action instituted hereunder in any of the
aforementioned courts and consents to the granting of such legal or equitable
relief as is deemed appropriate by such court.
6. Counterparts. This Agreement may be executed in two or more
counterparts including facsimile transmission thereof (and by different parties
on separate counterparts), each of which shall be an original, but all of which
together shall constitute one of the same instrument.
7. Severability. If any one or more of the covenants, agreements,
provisions or terms of this Agreement shall for any reason whatsoever be held
invalid, then such covenants, agreements, provisions, or terms shall be deemed
severable from the remaining covenants, agreements, provisions or terms of this
Agreement and shall in no way affect the validity or enforceability of the other
provisions of this Agreement.
8. No Proceedings. Each of the parties hereto hereby agrees that it
will not institute against, or join any other person in instituting against CAC
Funding Corp. or CAC Warehouse Funding Corp. any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any federal or state bankruptcy or similar law so long as there shall not have
elapsed one year and one day after there are no remaining amounts owed to any of
the Creditors by any of the CAC Entities pursuant to the BofA Documents and the
Wachovia Documents.
9. Amendment. This Agreement and the rights and obligations of the
parties hereunder may not be changed orally, but only by an instrument in
writing executed by all of the parties hereto.
10. Capitalized Terms. Capitalized terms used but not otherwise defined
herein shall have the meaning set forth in Appendix A attached hereto and made
part of this Agreement.
11. No Third Party Beneficiaries. This Agreement is not intended to
confer upon any person other than the parties hereto any rights or remedies
hereunder.
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12. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
successors and assigns.
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SIGNATURE PAGE TO
MUTUAL RELEASE AND INTERCREDITOR AGREEMENT
This Agreement has been executed and delivered by the parties hereto on
September 30, 2002.
CREDIT ACCEPTANCE CORPORATION BANK OF AMERICA, N.A., AS AGENT
/s/ Xxxxxxx X. Xxxx /s/ Xxxxxxxxxxx X. Xxxxx
-------------------------------- ----------------------------------
By: Xxxxxxx X. Xxxx By: Xxxxxxxxxxx X. Xxxxx
Title: Chief Financial Officer Title: Vice President
WACHOVIA SECURITIES, INC., AS AGENT COMERICA BANK, AS AGENT
/s/ Xxxxxxx X. Xxxxxxxx /s/ Xxxxx Xxxx
-------------------------------- ----------------------------------
By: Xxxxxxx X. Xxxxxxxx By: Xxxxx Xxxx
Title: Vice President Title: Account Officer
CAC FUNDING CORP. CAC WAREHOUSE FUNDING CORP.
/s/ Xxxxxxx X. Xxxx /s/ Xxxxxxx X. Xxxx
-------------------------------- ----------------------------------
By: Xxxxxxx X. Xxxx By: Xxxxxxx X. Xxxx
Title: Chief Financial Officer Title: Chief Financial Officer
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APPENDIX A
DEFINITIONS
Advance: Amounts advanced to a Dealer upon the acceptance of a Contract
by CAC pursuant to a Dealer Agreement.
BofA Securitization Documents: The Amended and Restated Security
Agreement dated as of July 20, 2001, as amended, among CAC Funding Corp., Kitty
Hawk Funding Corporation, Bank of America, N.A., and CAC and the documents
related thereto.
CAC Credit Facility Documents: The Amended and Restated Credit
Acceptance Corporation Credit Agreement, dated as of June 11, 2001, as amended,
by and among the Banks signatory thereto, Comerica Bank, CAC, Credit Acceptance
Corporation UK Limited, CAC of Canada Limited and Credit Acceptance Corporation
Ireland Limited and the documents related thereto.
CAC Entities: Each of CAC, CAC Funding Corp. and CAC Warehouse Funding
Corp.
Collections: All money, amounts or other payments received or collected
by CAC, individually or as servicer, or any successor servicer or any other CAC
Entity with respect to a Contract in the form of cash, checks, wire transfers or
other form of payment in accordance with the Contracts or the Dealer Agreements,
including, without limitation, with respect to a Pool amounts collected under
any other Pool which are Back-end Dealer Payments that have been set off by CAC
or by Comerica pursuant to the CAC Credit Facility Documents, against amounts
owing under such Pool.
Contract: A retail installment contract for the sale of new or used
motor vehicles assigned outright by Dealers to CAC or a subsidiary of CAC or
written by Dealers in the name of CAC or a subsidiary of CAC (and funded by CAC
or such subsidiary) or assigned by Dealers to CAC or a subsidiary of CAC, as
nominee for the Dealer, for administration, servicing, and Collection, in each
case pursuant to an applicable Dealer Agreement.
Creditor: Each of Comerica, BofA and Wachovia.
Dealer: A person engaged in the business of the retail sale or lease of
new or used motor vehicles, including both businesses exclusively selling used
motor vehicles and businesses principally selling new motor vehicles, but having
a used vehicle department, including any such person which constitutes an
affiliate of CAC.
Dealer Agreement: The sales and/or servicing agreements between CAC or
its subsidiaries and a participating Dealer which sets forth the terms and
conditions under which CAC or its subsidiaries (i) accepts, as nominee for such
Dealer, the assignment of Contracts for purposes of administration, servicing
and collection and under which CAC or its subsidiary may make Advances to such
Dealers and (ii) accepts outright assignments of Contracts from Dealers or funds
Contracts originated by such Dealer in
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the name of CAC or any of its subsidiaries, in each case as such agreements may
be in effect from time to time.
Financing Documents: The CAC Credit Facility Documents, the BofA
Securitization Documents and the Wachovia Securitization Documents.
Pool: a grouping on the books and records of CAC or any of its
subsidiaries of Advances, Contracts originated or to be originated with CAC or
any of its subsidiaries by a Dealer and bearing the same pool identification
number assigned by CAC's computer system.
Wachovia Securitization Documents: The Loan and Security Agreement
dated as of September __, 2002 among CAC Warehouse Funding Corp., CAC, the
Investors named therein, Variable Funding Capital Corporation, Wachovia
Securities, Inc., Wachovia Bank, National Association and OSI Portfolio
Services, Inc. and the documents related thereto.
8.
