EXHIBIT 10.10
REVOLVING CREDIT PROGRAM AGREEMENT
This Program Agreement ("Agreement") is made as of the 23/rd/ day of
January, 1998, by and between GREEN TREE FINANCIAL CORPORATION, a Delaware
corporation, its successors and assigns ("Green Tree"), with its executive
offices at 1100 Landmark Towers, 000 Xxxxx Xxxxx Xxxxxx, Xx. Xxxx, Xxxxxxxxx
00000, and U.S. REMODELERS, INC. ("U.S. Remodelers"), with its executive offices
at 00000 Xxxxxx Xxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000.
WHEREAS, U.S. Remodelers sells various goods and services to customers and
desires to have Green Tree provide revolving credit financing to its qualified
customers, and
WHEREAS, Green Tree is willing to provide revolving credit financing
(including the issuance of Credit Cards) to qualified U.S. Remodelers customers
as set forth herein during the term of this Agreement,
NOW THEREFORE, in consideration of the terms and conditions stated herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Green Tree and U.S. Remodelers agree as follows:
SECTION 1. DEFINITIONS
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The following words shall have the following meanings when used in this
Agreement:
"Account" means all of the accounts, receivables and contract rights
created between an Accountholder and Green Tree pursuant to the Program.
"Accountholder" means any person to whom Green Tree has extended credit
under the Program.
"Authorization" means permission from Green Tree to make a sale of
services, products, or goods to a cardholder pursuant to the agreement that is
charged to an Account.
"Chargeback" means the refusal of Green Tree to pay U.S. Remodelers or a
Dealer for a sales slip or payment by U.S. Remodelers or a Dealer to Green Tree
for a sales slip for which U.S. Remodelers or a Dealer was previously paid.
"Credit Agreement" means the open-end revolving credit agreement between
Green Tree and each Accountholder, together with any modifications or amendments
which may be made to such agreement.
"Credit Card" means a plastic card issued and owned by Green Tree under the
Program that may be used exclusively for the purchase of Products from U.S.
Remodelers or a Dealer.
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"Dealer" means an independent enterprise and independent entrepreneur which
has been expressly authorized by U.S. Remodelers to sell Products to consumers
in retail transactions.
"Dealer Agreement" means the Green Tree Dealer Agreement between a Dealer
and Green Tree substantially in the form of Exhibit A attached hereto.
"Default" means any Event of Default or the occurrence of any event which
would be an Event of Default with the giving of notice or lapse of any
applicable grace period.
"Event of Default" has the meaning given in Section 7.01.
"Program Documents" has the meaning given in Section 3.01.
"Products" means all products and services which may be purchased by an
Accountholder from U.S. Remodelers or a Dealer.
"Presentment Warranty" means each of the warranties set forth in this
Agreement made by U.S. Remodelers each time a Purchase is presented to Green
Tree for approval and settlement.
"Program" means the program established by Green Tree on the terms and
conditions outlined in this Agreement pursuant to which Green Tree will offer to
qualified U.S. Remodelers customers the revolving credit facility described in
Section 2.02 hereof. The term includes the extension of credit by Green Tree,
xxxxxxxx, collections, accounting between Green Tree and U.S. Remodelers, and
all aspects of the customized revolving credit plan contemplated herein.
"Purchase" means a purchase of Products from U.S. Remodelers or a Dealer
for which Green Tree has extended credit to an Accountholder.
"Secured Credit Card" means a Credit Card which is secured by a mortgage or
deed of trust on the Accountholders' primary residence, where allowed by law,
granted by the Accountholders and any other persons required by state law to
perfect a valid security instrument, in favor of Green Tree.
"Shared Risk Reserve Pool" means a reserve pool of discount fees which (i)
is owned by U.S. Remodelers; (ii) is managed and held by Green Tree; and (iii)
may be used by Green Tree to pay for any losses or collection costs experienced
by Green Tree in connection with Accounts held by Accountholders who fall within
a mutually agreed upon score band that will keep the reserve pool solvent. Any
proceeds in the Shared Risk Reserve Pool after the Program is terminated shall
be forwarded to U.S. Remodelers by Green Tree upon either (i) the Accounts
covered by the Shared Risk Reserve Pool are liquidated or (ii) the Accounts
covered by the Shared Risk Reserve Pool are sold by Green Tree.
"Unsecured Credit Card" means a Credit Card which is not secured by a
mortgage or deed of trust on the Accountholders' primary residence.
"Vision 21 System" means Green Tree's data and application processing
system.
SECTION 2. ESTABLISHMENT OF PROGRAM
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Section 2.01 Commencement of Program. The Program shall commence at such
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date and time as is mutually agreed to by Green Tree and U.S. Remodelers.
Section 2.02 Revolving Credit Facility. Under the Program, Green Tree
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agrees to offer qualified U.S. Remodelers and Dealer customers a revolving line
of credit that will include (i) a Credit Card that may be used exclusively for
Purchases, and (ii) a cash advance feature that will enable Accountholders to
obtain cash advances from Green Tree by requesting a specific cash advance
utilizing personalized convenience checks furnished by Green Tree.
Section 2.03 Credit Terms.
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(a) Unsecured Credit Card Terms. (i) Green Tree shall establish all of the
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terms and conditions of an Unsecured Credit Card, the Credit Agreement and the
terms and conditions under which credit is extended to Accountholders, including
without limitation the interest rate and fees and charges applicable to
Purchases. Green Tree intends initially to establish a variable rate of
interest which will yield a minimum annual percentage rate on all Accounts equal
to Prime Rate plus 8.49% for all Purchases. Green Tree may from time to time in
its sole discretion modify such terms and conditions to the extent it deems
necessary. (ii) Green Tree agrees to offer special credit promotions on
Purchases in accordance with the term and conditions as may be mutually agreed
to by the parties. (iii) Green Tree's financing of the Purchases is amortized
over the life of the Account at a payment factor of 2.0%, with a minimum payment
amount of $50.00.
(b) Secured Credit Card Option. Green Tree may offer a Secured Credit Card
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option under the Program. The following terms will govern the Secured Credit
Card option, the terms are subject to change by Green Tree: (i) Green Tree
shall establish an interest rate for Purchases that will vary by the Customer's
credit score and credit limit; (ii) Green Tree will charge an Origination Fee of
$100.00 or if applicable the highest amount allowed by state law whichever is
less, to the customer, (iii) Green Tree's financing of the Purchases shall be
amortized over the life of the Account with the payment factor of 2.5%. Except
as modified in this section the Secured Credit Card option will be subject to
all other terms of the Agreement. Green Tree and U.S. Remodelers shall mutually
agree on the commencement date of the Secured Credit Card option.
Section 2.04 U.S. Remodelers and Dealers to Honor Credit Card. U.S.
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Remodelers and Dealers hereby agrees to participate in the program and to honor
the Credit Card for Purchases. U.S. Remodelers and Dealers shall honor the
Credit Card only in accordance with the procedures outlined in Section 4 hereof,
as the same may be amended from time to time in accordance with the terms of
Section 4.01.
Section 2.05 Green Tree to Extend Credit. Subject to (i) the terms of this
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Agreement, (ii) the credit limits applicable to each Account, and (iii) the
terms and conditions in the Credit Agreement, Green Tree shall extend credit to
Accountholders in accordance with Section 4.
Section 2.06 Confidential Information. Each party agrees that any
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information concerning the content and/or conduct of any aspect of the other
party's business divulged as a result of this Agreement, including but not
limited to marketing techniques and methods of
operation, are and shall be treated as confidential knowledge, unique and
proprietary information, and trade or business secrets. Each party warrants and
guarantees to hold in strict confidence any and all confidential knowledge,
proprietary information, trade or business secrets or any other knowledge or
information, other than that which is public knowledge or otherwise known to the
party, of or relating to the other party's business, which may come to its
knowledge during the term of this Agreement, and agrees that it will not, except
as authorized or directed by the other party in writing, disclose to others, use
for its own benefit, copy or make notes of such confidential knowledge, own
business, access to confidential information furnished under this Agreement to
those of its employees, agents or subcontractors who reasonably require the same
to carry out the purposes of this Agreement shall ensure the confidentiality of
said information.
Section 2.07. U.S. Remodelers' and Dealer Customer List. The names of U.S.
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Remodelers and Dealer customers who make application to become Accountholders
and credit and other information relating to them does not constitute
"Confidential Information."
Section 2.08. U.S. Remodelers Commitment. U.S. Remodelers agrees that U.S.
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Remodelers and its Dealers shall give Green Tree the right of first refusal for
all financed business generated by U.S. Remodelers and its Dealers. U.S.
Remodelers promises and commits to Green Tree that the Purchases made under the
Program shall be as follows: (i) there will be at least $20 million in Purchases
made during months 1 through 15 under the Program; (ii) there will be at least
an additional $22 million in Purchases made during months 15 through 27; (iii)
there will be at least an additional $25 million in Purchases made during months
28 through 39 under the Program: (iv) there will be at least an additional $27
million in Purchases made during months 40 through 51 under the Program; and (v)
there will be at least an additional $30 million in Purchases made during months
52 through 63 under the Program.
Section 2.09. Fees. Discounts and Charges
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(a) U.S. REMODELERS ACTIVATION FEE: U.S. Remodelers agrees to reimburse
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Green Tree for 50% of all Program Document, system set-up and all other
activation expenses incurred by Green Tree in the activation of the Program if
the total Purchases generated in the first twelve months under the Program is
less than $20 million on a pro rata basis.
(b) PROMOTIONAL CASH DISCOUNT FEE: For promotional financing options
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offered under the Program, U.S. Remodelers shall pay Green Tree the following
discount fees:
i. 90 days same as cash without payments, a Discount Fee equal to
3.00% of the Purchase.
ii. 180 days same as cash without payments, a Discount Fee equal to
6.00% of the Purchase.
iii. 90 days deferred payment with interest accruing, a Discount Fee
equal to 0.00% of the Purchase.
iv. 180 days deferred payment with interest accruing, a Discount Fee
equal to 1.00% of the Purchase.
For a Purchase to qualify under a promotional financing option, the
Purchase must be at least $250.00. Purchases made under the promotional
financing shall not exceed 20% of total Purchases under the Program. Green Tree
reserves the right to change the discount fees if U.S. Remodelers exceeds this
limit.
Discount fees on the promotional financing options can also be adjusted
upward or downward as the case may be following the first anniversary of the
Program commencement date and on an annual basis thereafter. Any adjustments
will be based on the one year Treasury Xxxx rate. For each ten basis point
increase in the Treasury Xxxx rate, the discount fee on 90 days promotional
financing options will be increased by three basis points and the discount fee
on 180 days promotional financing options will be increased by five basis
points. Decreases to the one year Treasury Xxxx rate will have the opposite
effect.
(c) SHARED RISK RESERVE DISCOUNT: U.S. Remodelers will pay Green Tree a
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discount fee equal to 7% of each Purchase made by Accountholders who fall into a
mutually agreed upon credit score band for the Unsecured Credit Card program.
The discount fees for this section shall be maintained in the Shared Risk
Reserve Pool.
(d) CONVENIENCE USAGE CHARGE: None.
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(e) RETURNED MERCHANDISE CHARGE: None.
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(f) FORMS FEE: Forms will be supplied and its associated expense will be
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paid by Green Tree.
(g) CHARGEBACK FEE: None.
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(h) U.S. REMODELERS INSERT FEE: Green Tree will not charge U.S. Remodelers
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any fees for billing statement inserts requested and provided by U.S.
Remodelers, unless the insert increases the postage paid by Green Tree for the
billing statement. In which case, U.S. Remodelers shall pay Green Tree the
increased postage.
(i) U.S. REMODELERS PARTICIPATION FEES: On a monthly basis, Green Tree will
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pay U.S. Remodelers a participation fee based on the total Unsecured Credit Card
Purchases generated during the month as follows, if the volume commitments of
Section 2.08 are met:
Total Unsecured Purchases Under the Program Participation Fee
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During the First Fifteen Months of the Program
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$0-less than $35 million 1.5%
$35-less than $50 million 1.75%
$50 million or greater 2.0%
Total Unsecured Purchases Under the Program Participation Fee
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During the Each Subsequent 12 Month Period
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$0-less than $35 million 1.5%
$35-less than $50 million 1.75%
$50 million or greater 2.0%
(1) Retroactive recapture of the participation fee. The parties agree that
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once the total Purchases are greater than $35 million, then the previous
Unsecured Credit Card Purchases shall be subject to the 1.75 % participation fee
and Green Tree shall forward the additional .25% to U.S. Remodelers within 30
days of the date when Unsecured Credit Card Purchases exceed $35 million. The
parties agree that once the total Unsecured Credit Card Purchases are greater
than $50 million, then the previous Unsecured Credit Card Purchases shall be
subject to the 2.0% participation fee and Green Tree shall forward the
additional .25% to U.S. Remodelers within 30 days of the date when Unsecured
Credit Card Purchases exceed $50 million. However, the provisions of this
paragraph shall not apply to any Purchases after the sixtieth month of the
Program.
(2) Examples. The following example illustrates the participation fee
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calculation for one month under the Program: (i) total Unsecured Credit Card
Purchases under the Program as of March 31 are $20 million; (ii) Unsecured
Credit Card Purchases made during the month of April are $20 million; (iii) the
participation payment for the month of April would be $400,000, which is the sum
of (x) the product of $20 million multiplied by 0.25% ($100 million x 0.25% =
$50,000); plus (y) the product of $20 million multiplied by 1.75% ($20 million x
1.75% = $150,000).
The following example illustrates the participation fee calculation for the
following month: (i) total Unsecured Credit Card Purchases under the Program as
of April 30 are $40 million; (ii) Unsecured Credit Card Purchases made during
the month of May are $5 million: (iii) the participation payment for the month
of May would be $87,500, which is the product of $5 million multiplied by 1.75%.
The following example illustrates the participation fee calculation for the
first month on the sixteenth month of the Program: (i) total Unsecured Credit
Card Purchases under the Program at the end of the fifteenth month of the
Program are $75 million; (ii) Unsecured Credit Card Purchases made during the
sixteenth month of the Program are $10 million: (iii) the participation payment
for the sixteenth month would be $150,000.00. which is the product of $10
million multiplied by 1.5%.
Section 2.10. Guaranty of Dealer Obligations. Subject to the terms of
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Section 4.06, U.S. Remodelers shall be liable to Green Tree in the case of a
payment breach of the Dealer Agreement by any Dealer. Furthermore, U.S.
Remodelers shall pay Green Tree for any and all losses, as defined in Section
5.01, experienced by Green Tree as a result of any breach of any Dealer
Agreement by any Dealer. U.S. Remodelers does not guaranty the debts of any
Accountholder. U.S. Remodelers hereby now and forever waives all defenses
available to any Dealer and/or given to sureties or Guarantors at law or in
equity.
Green Tree shall provide notice to U.S. Remodelers within 5 business days
after Green Tree has determined that a breach of the Dealer Agreement has
occurred. Further, Green Tree shall provide reasonable access to information
and assist U.S. Remodelers in pursuit of claims against any defaulting Dealer.
No compromise or settlement shall be negotiated without the prior written
approval from U.S. Remodelers.
SECTION 3. ADMINISTRATION OF PROGRAM
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Section 3.01 Preparation of Documents. Green Tree and U.S. Remodelers
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shall cooperate and assist each other in the preparation of all documents to be
used in connection with the Program. Green Tree shall provide U.S. Remodelers
with the form and content of credit applications, Credit Agreements, Credit
Cards, and other forms used in connection with the Program (hereinafter referred
to as "Program Documents"). All Program Documents shall clearly disclose that
Green Tree is the creditor. U.S. Remodelers shall not use any Program Document
unless Green Tree has expressly approved its form and content. U.S. Remodelers
shall not refer to Green Tree, except in approved Program Documents.
Section 3.02 Credit Decisions. Green Tree, in its sole discretion, shall
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determine the creditworthiness of individual applicants under the Program and
the range of credit limits to be made available to individual Accountholders.
Green Tree shall make commercially reasonable efforts to approve creditworthy
customers. Green Tree may suspend or terminate the credit privileges of any
Accountholder at any time.
Section 3.03 Ownership of Accounts. Green Tree shall be the sole and
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exclusive owner of all Accounts, Credit Cards, Credit Agreements, Accountholder
data (including Accountholder lists), sales slips, credit slips and receipts or
evidences of payment or Purchases by Accountholders and other Program Documents,
and shall be entitled to receive all payments made by Accountholders on
Accounts, and U.S. Remodelers acknowledges and agrees that it has no right,
title or interest in the Accounts, Credit Cards, Credit Agreements,
Accountholder data, sales slips, credit slips, receipts or evidence of payments
or Purchases by Accountholders and other Program Documents and has no right to
any pavements made by Accountholder on Accounts. Green Tree shall be identified
to Accountholders as the creditor for all purposes.
Section 3.04 Periodic Statements. Green Tree shall be responsible for
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mailing monthly periodic statements to Accountholders and collecting all amounts
due on the Accounts. U.S. Remodelers shall not have any responsibilities
regarding billing or collections on Accounts and, except as otherwise provided
herein, shall not be responsible for uncollectible Accounts. U.S. Remodelers
authorizes and empowers Green Tree to sign and endorse U.S. Remodeler's name on
all checks, drafts, money orders, or other forms of payment with regard to the
Accounts.
Section 3.05 Enhancements. Green Tree and its affiliates may from time to
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time make other products and services available to Accountholders that enhance
the features of the Program or the Accounts, including without limitation,
credit insurance, a credit card protection plan, legal services, auto clubs and
extended warranties. With respect to credit insurance, U.S. Remodelers, when
instructed by Green Tree, will offer credit insurance as a customer option in
connection with each Account. Optional credit insurance enrollment forms will
be provided by Green Tree.
Section 3.06 Promotions. U.S. Remodelers and Green Tree may from time to
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time, upon mutual agreement, develop marketing programs pursuant to which Green
Tree will offer revolving lines of credit to U.S. Remodelers customers. The
mutually agreed upon marketing programs will be reduced to written agreements
which shall be signed by U.S. Remodelers and Green Tree.
Section 3.07 Marketing. U.S. Remodelers may not, in any advertisement or
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promotion of its products or services, advertise the availability of financing
through Green Tree without the prior written approval of Green Tree.
SECTION 4. OPERATING PROCEDURES
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Section 4.01 General. Green Tree and U.S. Remodelers shall follow the
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operating procedures outlined in this Section 4 for Accounts generated under the
Program. Green Tree may amend or supplement such operating procedures from time
to time in its sole discretion to the extent it deems necessary or desirable to
comply with applicable law.
Section 4.02 Solicitation of Accounts. The following procedures shall be
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followed for the solicitation of Accounts and the processing of credit
applications:
(a) In connection with the sale of Products, U.S. Remodelers and Dealers
may take credit applications on behalf of Green Tree using the credit
application and disclosure forms provided by Green Tree.
(b) U.S. Remodelers or Dealer shall forward promptly to Green Tree, by
mail, telephone, facsimile transmission, or electronically via the Vision 21
System, credit applications completed by customers.
(c) All credit applications will be reviewed by Green Tree for approval and
establishment of the applicable credit limit. Green Tree will communicate
credit approvals and denials to both the customer and U.S. Remodelers or Dealer.
Section 4.03 New Account Fulfillment. Green Tree shall be solely
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responsible for Account fulfillment, including the mailing of Accountholder
welcome letters, Credit Cards, Credit Agreements and convenience checks.
Section 4.04 Procedures for Purchases and Credits.
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(a) U.S. Remodelers or Dealer shall complete a sales slip for each Purchase
and imprint or write the Accountholders name and Account number on the sales
slip.
(b) U.S. Remodelers or Dealer shall obtain the Accountholder's signature on
the sales slip once all of the Purchase information is complete. If the
Accountholder does not have his/her Credit Card, the signature on the sales slip
must be reasonably similar to the signature on one form of identification, one
with a photograph, provided by the Accountholder. A valid drivers license,
military or state identification is required as identification. U.S. Remodelers
warrants the identity of the Accountholder in all cases.
(c) U.S. Remodelers or Dealer shall obtain prior authorization for all
Purchases and record the authorization code on the sales slip. Authorization
may be obtained electronically through the Vision 21 System or by contacting
Green Tree at a designated telephone number established for the purpose of
issuing authorization under the Program.
Section 4.05 Settlement Procedures.
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(a) All sales data will be transmitted by U.S. Remodelers to Green Tree
through daily reports ("Daily Reports"). Daily Reports shall include the
following: (i) the account number, authorization number, amount and date of each
Purchase, (ii) the account number, amount and date for each credit slip issued
with respect to the Accounts, and (iii) such other information that Green Tree
may request.
(b) The receipt of the following supporting documents shall be a
condition to Green Tree's obligation to fund the Purchases:
(i) customer's original credit application;
(ii) original completed sales slip including:
. notice of right to cancel
. notice of cancellation
(iii) the original home equity line of credit agreement and mortgage/deed
of trust (collectively referred to as "Note"), in the case of Secured
Credit Card Accounts; and
(iv) a copy of a completion certificate signed by the Accountholder.
Funding of the Purchases will also be subject to an independent verification by
Green Tree of the customers satisfaction with the Products. Purchases where
Green Tree has not received the original application or Note are subject to
Chargeback under Section 5.
(c) Green Tree shall pay to U.S. Remodelers the amount of each Purchase for
which all of the proper supporting documentation has been provided less any
applicable discounts. Green Tree reserves the right to conduct customer
satisfaction calls prior to funding all Purchases. Green Tree shall be entitled
to set off against amounts due to U.S. Remodelers for Purchases the amount of
any credit slips issued for Purchases and any Chargebacks pursuant to Section 5
hereof. Funds due to U.S. Remodelers for Purchases hereunder shall be forwarded
to U.S. Remodelers via the Automated Clearing House System no later than the
next business day after all of the conditions to funding described herein have
been met.
(d) Subject to the terms of Section 5.03, Green Tree and U.S. Remodelers
shall cooperate in resolving any disputes regarding amounts set forth in the
Daily Reports or the supporting documentation. Green Tree shall be entitled to
withhold payment for the disputed portion of any Daily Report, or for any
Purchase for which the supporting documentation, in Green Tree's sole opinion,
is incomplete or unsatisfactory.
Section 4.06 Dispute Resolution Procedures. U.S. Remodelers shall
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cooperate with Green Tree to promptly resolve any Accountholder Product related
dispute. Green Tree will notify U.S. Remodelers via fax upon receipt of the
Accountholder dispute. U.S. Remodelers will have forty calendar days to settle
or resolve the dispute. Failure to resolve or settle the dispute to the total
satisfaction of the Accountholder will result in a Chargeback pursuant to
Section 5 hereof.
SECTION 5. CHARGEBACK
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Section 5.01 Chargeback Rights. Except as modified in Section 5.03, Green
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Tree shall have the right, at its option, to Chargeback to U.S. Remodelers the
amount of any Purchase plus all accrued and unpaid finance charges and other
amounts owing to Green Tree if:
(a) Any Presentment Warranty made by U.S. Remodelers pursuant to Section
6.01 proves to be false or inaccurate in any material respect, after a
reasonable investigation by Green Tree;
(b) The Accountholder asserts any valid claim or defense against Green Tree
as, a result of any act or omission of U.S. Remodelers or a Dealer that violates
any applicable law, statute, ordinance, rule or regulation, after a reasonable
investigation by Green Tree;
(c) The Accountholder disputes the amount or existence of such Account or
the Accountholder refuses to pay (including by exercise of its right under the
Fair Credit Billing Act or other similar law to require Green Tree to credit its
Account), alleging dissatisfaction with the Products received, a breach of any
warranty or representation in connection with the transaction, or an offset or
counterclaim against Green Tree based on an act or omission of U.S. Remodelers
or a Dealer after a reasonable investigation by Green Tree; or
(d) U.S. Remodelers or a Dealer did not comply with the operating
procedures outlined in Section 4 herein.
Section 5.02 Limitation of Chargeback Rights. In its reasonable discretion
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Green Tree may compromise and settle any claim made by any Accountholder if such
claim may give Green Tree a right to Chargeback up to the face amount of any
sales slip. In the event of any such compromise or settlement, Green Tree shall
adjust the Accountholder's Account, and Green Tree's right to Chargeback shall
be limited to the actual amount so compromised.
Section 5.03 Exercise of Chargeback. If U.S. Remodelers does not agree
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with the Accountholder's allegation regarding dissatisfaction with the Products
received, then Green Tree and U.S. Remodelers shall select an independent third
party to evaluate the Accountholder's dispute regarding the Product. U.S.
Remodelers shall pay for the costs associated with the third party evaluation.
If Green Tree exercises its right of Chargeback, Green Tree shall have the right
to off set the amount of the Chargeback against any amounts due U.S. Remodelers
under this Agreement or, if Chargebacks exceed sums due U.S. Remodelers, Green
Tree may demand immediate payment from U.S. Remodelers for the full amount of
such excess. If any Purchase is charged back, Green Tree shall assign, without
recourse, all right to payment for such Purchase to U.S. Remodelers upon the
request of U.S. Remodelers.
SECTION 6. WARRANTIES AND COVENANTS
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Section 6.01 Presentment Warranties. U.S. Remodelers represents and
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warrants to Green Tree with respect to each Account (the following shall be
deemed restated, renewed and reaffirmed with respect to each Purchase presented
to Green Tree for approval and settlement):
(a) that the sales slip represents a bona fide sale and was actually
executed by the person named therein as Accountholder;
(b) that the signature on the sales slip appears reasonably similar to the
signature of the Accountholder on Credit Card or the signature on other valid
identification examined by U.S. Remodelers;
(c) that the sales slip has not been materially altered;
(d) that the Accountholder is of local age and competent to open an
Account;
(e) that the Products are accurately described on the sales slip and any
Products described therein have been delivered into the possession of the
Accountholder and any Products described therein have been fully performed to
the Accountholder's satisfaction;
(f) that the transaction, including prior authorization, was conducted by
U.S. Remodelers in accordance with the operating procedures set forth in Section
4 above (as same may be revised from time to time);
(g) that the account number, name of Accountholder and authorization
number have been printed on each sales slip;
(h) that U.S. Remodelers has not received, directly or indirectly, and will
refuse to accept, any reimbursement, payment or trade-in for the charges listed
on such sales slip (other than from Green Tree) and has not and will not, either
directly or indirectly, take or grant any right or security interest in any
sales slip or credit slip (other than to Green Tree) which is the subject of the
transaction;
(i) that the transaction was conducted by U.S. Remodelers in accordance
with all applicable laws and regulations that pertain to the sale of Products by
U.S. Remodelers;
(j) there is no fact nor any claim of defense of any Accountholder that
would impair the validity, enforceability, or collectability of the obligation
of the Accountholder evidenced by the sales slip or the Account;
(k) that U.S. Remodelers has full and complete title to the Products
subject only to the rights of the Accountholder which exist by virtue of the
Account;
(1) that there have been no representations or warranties made to the
Accountholder which are not contained in the sales slip other than U.S.
Remodelers' standard warranties; and in the event U.S. Remodelers breaches a
standard warranty, U.S. Remodelers will cure the breach within thirty (30)
calendar days of notice of the breach;
(m) U.S. Remodelers shall, within three (3) business days of its receipt,
provide Green Tree with a copy of any written complaint from any customer
relating to any sales slip, however, if U.S. Remodelers receives a warranty card
it or a Dealer issued to an Accountholder within 59 days after completion of a
Product installation, then U.S. Remodelers needs to notify Green Tree of the
complaint, within 10 days of its receipt, if the complaint is not resolved to
the Accountholders satisfaction;
(n) U.S. Remodelers shall indemnify Green Tree and hold it harmless from
and against all losses, cost, damage, and expense, including reasonable
attorney's's fees, at any time incurred by Green Tree because of any violation
of state or Federal law or regulation or other illegal or actionable conduct;
(i) resulting from acts or omissions by U.S. Remodelers, its employees, its
agents or Dealers in connection with the sale of any Products, or (ii) resulting
from the documents used in connection with the transaction, including but not
limited to documents given to Accountholder pertaining to warranties, service
agreements, credit disclosures, insurance, and sales, application and contracts
forms, or (iii) resulting from any liability Green Tree incurs by reason of 12
Code of Federal Regulations Section 226.12 (c) of Regulation Z regarding the
right of a cardholder to assert claims and defenses against card issuers.
However, U.S. Remodelers liability for sufficiency of document contents does not
apply to any document provided by Green Tree, but shall apply to any other
failures or omissions by U.S. Remodelers or its agents related to any such
document furnished by Green Tree, including, but not limited to U.S. Remodelers'
failure in completing any such document, or properly delivering copies to
Accountholders;
(o) U.S. Remodelers owns the sales slip free from any claims, liens,
security interest or other encumbrances:
(p) the facts set forth in the sales slip, credit application, any
appraisal submitted to value the real property ("Appraisal") which real property
acts as security for a Secured Credit Account and any title report submitted in
connection with the Account ("Title Report") are true and accurate in all
material respects.
Section 6.02 Program Covenants. U.S. Remodelers covenants to do the
------------------------------
following during the term of this Agreement with respect to the operation of the
Program:
(a) U.S. Remodelers shall cooperate with Green Tree promptly to resolve all
disputes with Accountholders.
(b) U.S. Remodelers shall not seek or obtain any special agreement or
condition from, nor discriminate in any way against, any Accountholder with
respect to the terms of any transaction.
(c) U.S. Remodelers shall pay to Dealer, subject to prior receipt from
Green Tree, the amount of each Purchase for which all of the proper supporting
documentation has been provided less any applicable standard and promotional
discounts and other amounts owed to U.S. Remodelers by Dealer. Funds due to
Dealer for Purchases shall be forwarded from U.S. Remodelers to Dealer no later
than seven (7) business days after Green Tree has forwarded funds to U.S.
Remodelers.
Section 6.03 General Representations and Warranties of U.S. Remodelers.
----------------------------------------------------------------------
U.S. Remodelers makes the following representations and warranties to Green
Tree, each and all of
which shall survive the execution and delivery of this Agreement, and each and
all of which shall be deemed to be restated and remade on each day on which any
Account is opened, any Purchase is presented for settlement pursuant to Section
4.05, or any action is taken with respect to the Program:
(a) Corporate Existence. U.S. Remodelers (i) is a corporation duly
-------------------
organized, validly existing, and in good standing under the laws of the State of
Delaware; (ii) is duly qualified as a corporation and in good standing under the
laws of each jurisdiction where its ownership or lease of property or the
conduct of its business requires such qualification; (iii) has the requisite
corporate power and authority and the legal right to own, pledge, mortgage, and
operate its .properties, to lease the properties it operates under a lease, and
to conduct its business as now conducted and hereafter contemplated to be
conducted; (iv) has all necessary licenses, permits, consents, or approvals
required for the conduct of its business; and (v) is in compliance with its
certificate of incorporation and bylaws.
(b) Corporate Power. Authorization: Enforceable Obligation. The
-------------------------------------------------------
execution, delivery, and performance of this Agreement and all instruments and
documents to be delivered by U.S. Remodelers hereunder: (i) are within U.S.
Remodelers' corporate power; (ii) have been duly authorized by all necessary or
proper corporate action, including the consent of shareholders where required;
(iii) do not and will not contravene any provisions of U.S. Remodelers'
certificate of incorporation or bylaws; (iv) will not violate any law or
regulation or any order or decree of any court or Governmental instrumentality;
(v) will not conflict with or result in the breach of, or constitute a default
under any indenture, mortgage, deed of trust, lease, agreement, or other
instrument to which U.S. Remodelers is a party or by which U.S. Remodelers or
any of its assets or property are bound; and (vi) do not require any filing or
registration with, or the consent or approval of, any Governmental body, agency,
authority, or any other person which has not been made or obtained previously,
copies of which have been provided to Green Tree. The Agreement has been duly
executed and delivered by U.S. Remodelers and constitutes a legal, valid, and
binding obligation of U.S. Remodelers enforceable against U.S. Remodelers in
accordance with it terms.
Section 6.04 Program Covenants of Green Tree. Green Tree covenants to
--------------------------------------------
provide and maintain the Vision 21 System computer software required for the
Program.
Section 6.05 Representations and Warranties of Green Tree. Green Tree
---------------------------------------------------------
makes the following representations and warranties to U.S. Remodelers, each and
all of which shall be deemed to be made on each day on which Accounts are
opened, Purchase documentation is received for settlement pursuant to Section
4.05, or any action is taken with respect to the Program on or after the Program
commencement date established pursuant to Section 2.01:
(a) Corporate Existence. Green Tree (i) is a corporation duly organized,
-------------------
validly existing and in good standing under the laws of the State of Delaware;
(ii) has the requisite corporate power and authority and the legal right to own,
pledge, mortgage, and operate its properties, to lease the properties it
operates under a lease, and to conduct its business as now conducted and
hereafter contemplated to be conducted; and (iii) is in compliance with its
articles of incorporation and bylaws.
(b) Corporate Power. Authorization: Enforceable Obligation. The
-------------------------------------------------------
execution, delivery, and performance of this Agreement and all instruments and
documents to be delivered by Green
Tree hereunder, (i) are within Green Tree's corporate power, (ii) have been duly
authorized by all necessary or proper corporate action, including the consent of
shareholders where required; (iii) do not and will not contravene any provision
of Green Tree's certificate of incorporation or bylaws; (iv) will not violate
any law or regulation or an order or decree of any court or Governmental
instrumentality; (v) will not conflict with or result in the breach of, or
constitute a default under, any indenture, by which Green Tree or any of its
property is bound; and (vi) do not require any filing or registration with or
the consent or approval of any Governmental body, agency, authority, or any
other person which has not been made or obtained previously. This Agreement has
been duly executed and delivered by Green Tree, and constitutes the legal,
valid, and binding obligation of Green Tree, enforceable against Green Tree in
accordance with its terms.
(c) Program Compliance. Green Tree warrants to U.S. Remodelers that the
------------------
Program shall be administered and serviced in compliance with applicable state
and federal laws.
SECTION 7. EVENTS OF DEFAULT; RIGHTS AND REMEDIES
-------------------------------------------------
Section 7.01 Events of Default. The occurrence of any one or more of the
------------------------------
following events shall constitute an "Event of Default" hereunder:
(a) Either U.S. Remodelers or Green Tree shall fail to make any payment of
any amount due pursuant to this Agreement when due and payable or declared due
and payable, and the same shall remain unpaid for a period of fifteen (15) days;
(b) Either U.S. Remodelers or Green Tree shall fail or neglect to perform,
keep, or observe any term, provision, condition, commitment or covenant
contained in this Agreement that is required to be performed, kept or observed
by either party, and the same shall remain uncured for a period of thirty (30)
days after the other party shall have given written notice thereof;
(c) Any representation or warranty made or delivered by either U.S.
Remodelers or Green Tree or any of its respective officers, employees, agents,
or representatives shall not be true and correct in any material respect as of
the date when made or reaffirmed;
(d) U.S. Remodelers shall be acquired (whether by merger, consolidation,
change of control, as defined below, or otherwise) by any person not an
affiliate of U.S. Remodelers as of the date of execution of this Agreement,
unless Green Tree consents to the acquisition in writing prior to the
acquisition, which consent shall not be unreasonably withheld. For purposes of
this section of "change of control" shall mean any sale of all or substantially
all of the assets of an entity (whether in one or a series of transactions) or
an entity is merged or consolidated into another corporation or the capital
stock of an entity is transferred;
(e) Either U.S. Remodelers or Green Tree shall (i) file a petition seeking
relief pursuant to the Bankruptcy Code or any other applicable bankruptcy or
other similar law; (ii) consent to the institution of proceedings pursuant
thereto or to the filing of any such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee, or
sequestrate (or similar official) of either party of any substantial part of its
properties; (iii) fail generally to pay its debts as such debts become due; or
(iv) take corporate action in furtherance of any such action;
(f) A material adverse change shall occur in the operations, financial
condition, business or prospects of U.S. Remodelers which has impaired or is
reasonable likely to impair, the ongoing operation or continued viability of the
Program, in each case, as determined by Green Tree, in its sole discretion.
Section 7.02 Remedies. If any Event of Default shall have occurred and be
---------------------
continuing the non-defaulting party shall have the right to terminate this
Agreement in the manner specified in Section 8 hereof
SECTION 8. TERM/TERMINATION
---------------------------
Section 8.01 Term. This Agreement shall continue in full force and effect
-----------------
until the sixty third month of the Program commencement date (established
pursuant to Section 2.01); thereafter, this Agreement shall renew automatically
for successive one year terms unless and until terminated by either U.S.
Remodelers or Green Tree by written notice to the other party at least 180 days
prior to the end of the original or any renewal term.
Section 8.02 Termination for Cause. If an Event of Default under Section
----------------------------------
7.01 shall occur, the non-defaulting party shall have the right immediately to
-----------
terminate this Agreement upon notice.
Section 8.03 Effect of Termination. Upon termination, all of the rights
----------------------------------
and obligation of the respective parties hereto shall cease; provided, however,
that the following shall survive the termination of this Agreement: (i) U.S.
Remodelers' obligation to reimburse Green Tree for amounts due to Green Tree in
connection with the offering of special credit promotions and a grace period on
Purchases pursuant to Section 2.03; (ii) Green Tree's Chargeback rights pursuant
to Section 5; (iii) the obligations of the parties related to indemnification
under Section 9. Upon termination, Green Tree shall cease to honor Purchases and
will terminate all privileges related to the Credit Cards. Furthermore, upon
termination U. S. Remodelers' right to Participation Fees under Section 2.09 (i)
shall cease immediately and Green Tree shall not be required to pay any
Participation Fees upon or any time after termination. Upon termination, U.S.
Remodelers may purchase from Green Tree all Accounts then outstanding for cash
in an amount equal to 102% of their unpaid principal balance plus all accrued
and unpaid finance charges and other amounts owing, to Green Tree. Upon such
payment, Green Tree will assign all such Accounts to U.S. Remodelers, or its
assigns, without recourse or warranty.
SECTION 9. INDEMNIFICATION
--------------------------
Section 9.01 By Green Tree. Green Tree shall be liable to and shall
--------------------------
indemnify and hold harmless U.S. Remodelers and its officers, directors and
employees from and against any Losses, as defined below, arising out of the
intentional or negligent act or omission of Green Tree in the performance of its
duties and obligations under this Agreement or its failure to comply with the
terms of this Agreement or any applicable laws or regulations applicable to it,
including but not limited to a breach by Green Tree of the warranty contained in
Section 6.05 (c), Green Tree shall indemnify U.S. Remodelers for any Products
offered or sold by Green Tree.
Section 9.02 By U.S. Remodelers. U.S. Remodelers shall be liable to and
-------------------------------
shall indemnify and hold harmless Green Tree and its officers, directors and
employees from and
against any Losses, as defined below, arising out of the intentional or
negligent act or omission of U.S. Remodelers in the performance of its duties or
obligations under this Agreement or its failure to comply with the terms of this
Agreement or any applicable laws or regulations, including without limitation
Losses resulting from (i) acts or omissions in connection with the sale of any
Products, (ii) the Program Documents and other documents used in connection with
the transactions, including but not limited to documents given to any
Accountholder pertaining to warranties or service agreements, U.S. Remodelers'
liability for the Program Documents and other documents does not apply to any
document provided by Green Tree, but shall apply to any failures or omissions by
U.S. Remodelers or its officers, employees or agents related to any such
document furnished by Green Tree, including, but not limited to, U.S.
Remodelers' failure properly to complete any such document or deliver copies to
Accountholders, (iii) the material inaccuracy or incompleteness of any
information contained in any credit application of any Accountholder, or (iv)
any liability Green Tree incurs by reason of 12 Code of Federal Regulations
Section 226.12 (c) of Regulation Z regarding the right of a cardholder to assert
claims and defenses against card issuers, (v) the failure by U.S. Remodelers to
provide Products to Accountholders in accordance with their terms, and (vi) any
product liability or warranty claims in respect of such Products. U.S.
Remodelers shall not indemnify Green Tree for any Losses that result from any
products or services offered or sold by Green Tree.
Section 9.03 General. U.S. Remodelers and Green Tree shall promptly notify
--------------------
the other of any claim, demand, suit or threat of suit of which it becomes aware
(except with respect to a threat of suit either party might institute against
the other) which may give rise to a right of indemnification pursuant to this
Agreement. The indemnifying party will be entitled to participate in the
settlement or defense thereof and, if the indemnifying party elects, to take
over and control the settlement or defense thereof with counsel satisfactory to
the indemnified party. In any case, the indemnifying party and the indemnified
party shall cooperate (at no cost to the indemnified party) in the settlement or
defense of any such claim, demand, suit or proceeding. For purposes of this
Section 9, the term "Losses" shall mean any losses, damages, costs and expenses,
liabilities, settlements, including, without limitation, any attorneys' fees and
disbursements and court costs reasonably incurred by Green Tree or U.S.
Remodelers, as the case may be.
SECTION 10. MISCELLANEOUS
-------------------------
Section 10.01 Independent Contractors. In performing their respective
-------------------------------------
responsibilities under this Agreement, Green Tree and U.S. Remodelers are
independent contractors. This Agreement is not intended to create and shall not
be construed to create, a relationship of partner or joint venture or an
association for profit between Green Tree and U.S. Remodelers.
Section 10.02 Financial Statements. At least annually or more often if
----------------------------------
requested by Green Tree, U.S. Remodelers shall provide Green Tree with audited
balance sheets and profit and loss statements and make available to Green Tree's
representatives such other financial information as may be reasonably requested
by Green Tree. U.S. Remodelers understands and agrees that Green Tree may
verify any financial information provided by U.S. Remodelers and may, from time
to time, seek credit and other information concerning U.S. Remodelers from
others.
Section 10.03 Assignment: Delegation of Duties. Without the express
-----------------------------------------------
written consent of the other party, neither U.S. Remodelers nor Green Tree may
assign this Agreement or
delegate any of its duties hereunder except that (a) either U.S. Remodelers or
Green Tree may delegate such duties to any party which is then a wholly owned
subsidiary of the delegating party or a corporation under common control with
the delegating party, (b) Green Tree may assign this Agreement to a wholly owned
subsidiary, and (c) Green Tree may contract with a bank or other financial
institution in structuring the Program and in connection with such contract may
assign this Agreement or delegate duties to such financial institution to the
extent Green Tree deems necessary or desirable.
Section 10.04 Amendment. Subject to the right of Green Tree to amend and
-----------------------
supplement the operating procedures pursuant to Section 4.01 hereof, this
Agreement may not be amended except by written instrument signed by both Green
Tree and U.S. Remodelers.
Section 10.05 Non-Waiver. No delay by U.S. Remodelers or Green Tree hereto
------------------------
in exercising any of its rights hereunder or partial or single exercise of such
rights, shall operate as a waiver of that or any other right. The exercise of
one or more of U.S. Remodelers' or Green Tree's rights hereunder shall not be a
waiver of, nor preclude the exercise of, any rights or remedies available to
such party under this Agreement or in law or equity.
Section 10.06 Severability. If any provision of this Agreement is held to
--------------------------
be invalid, void or unenforceable, all other provisions shall remain valid and
be enforced and construed as if such invalid provision were never a part of this
Agreement.
Section 10.07 Governing Law. This Agreement and all rights and obligations
---------------------------
hereunder shall be governed by and construed in accordance with the substantive
laws of the State of Minnesota.
Section 10.08 Entire Agreement. This Agreement, including any addenda or
------------------------------
exhibits, constitutes the entire agreement between Green Tree and U.S.
Remodelers with respect to the Program and any matters relating thereto and all
prior agreements, negotiations and communications on such subject are hereby
superseded.
Section 10.09 Captions. Cautions used in this Agreement are for convenient
----------------------
reference only and shall not be construed as limiting or defining the
substantial content of this Agreement.
Section 10.10 Use of U.S. Remodelers Name and Xxxx. U.S. Remodelers hereby
--------------------------------------------------
expressly gives Green Tree permission to use its name, logo, registered
trademarks and service marks (if any) in connection with the operation of the
Program.
Section 10.11 Notices. Except as otherwise provided in this Agreement, all
---------------------
notices, demands and other communications hereunder shall be in writing and
shall be delivered personally or sent by facsimile, other electronic means or
nationally recognized overnight courier service addressed to the party to whom
such notice or other communication is to be given or made at such party's
address as set forth below, or to such other address as such party may designate
in writing to the other party from time to time in accordance with the
provisions hereof, and shall be deemed given when personally delivered, when
sent electronically or one (1) business day after being sent by overnight
courier.
To Green Tree:
Green Tree Financial Corporation
000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xx. Xxxx, Xxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxxxx
Facsimile: 612.292.2470
with copies to:
Green Tree Financial Corporation
1100 Landmark Towers
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attention: Xxxx Xxxxxxxxx, Esq.
Facsimile: 612.293.5746
Green Tree Financial Corporation
000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xx. Xxxx, Xxxxxxxxx 00000
Attention: Xxx XxXxxxxxx, Esq.
Facsimile: 612.292.2470
To U.S. Remodelers:
U.S. Remodelers Incorporated
0000 Xxxx Xxxxxxxxxxx Xxxx Xxxxx 000X
Xxxxxx, Xxxxx 00000-0000
Attention: Xxxxxx X. Xxxxx
Facsimile: 214.267.2014
Section 10.12 Multiple Counterparts. This Agreement may be executed in any
-----------------------------------
number of multiple counterparts, all of which shall constitute but one and the
same original.
IN WITNESS WHEREOF, Green Tree and U.S. Remodelers have hereunto set their
hands as of the date first written above.
GREEN TREE FINANCIAL U.S. REMODELERS INC.
CORPORATION
By: /s/ illegible By: /s/ Xxxxxx X. Xxxxx
------------------- -------------------
Its E.V.P. Its: President
------------------- ---------
