Exhibit 10.3
[***] TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
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SERVICING AGREEMENT
Dated as of January 29, 1998
Among
WEST CAPITAL FINANCIAL SERVICES CORP.
As the Servicer
WEST CAPITAL RECEIVABLES CORPORATION I
As the Borrower
And
NORWEST BANK MINNESOTA, NATIONAL ASSOCATION
As the Collateral Agent
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[***] Omitted pursuant to a request for confidential treatment. The omitted
material
has been filed separately with the Securities and Exchange Commission.
SERVICING AGREEMENT
Dated as of January 29, 1998
WEST CAPITAL FINANCIAL SERVICES CORP., a California
corporation (“WestCap”, and, in its capacity as servicer hereunder, together
with its successors and permitted assigns, the “Servicer”), WEST CAPITAL
RECEIVABLES CORPORATION I, a California corporation (the “Borrower”), and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, a national banking association,
as collateral agent (in such capacity, together with its successors and
permitted assigns, the “Collateral Agent”) agree as follows:.
W I T N E S S E T H:
WHEREAS, the Borrower has entered into a Credit Agreement,
dated as of January 29, 1998 (as it may from time to time be amended,
supplemented, or modified, the “Credit Agreement”) with Daiwa Finance
Corporation (the “Lender”) and WestCap, pursuant to which the Lender will
make advances (“Advances”) to the Borrower from time to time secured, in part
by the Designated Receivables (as hereinafter defined); and
WHEREAS, the Borrower has requested the Servicer to
undertake the collection and servicing responsibilities in respect of the
Designated Receivables, all upon the terms and subject to the conditions
hereinafter set forth; and
WHEREAS, it is a condition precedent to the obligation of the
Lender to make Advances under the Credit Agreement that the Borrower, the
Servicer and the Collateral Agent shall have executed and delivered this
Servicing Agreement;
NOW, THEREFORE, to induce the Lender to make the Advances,
the Borrower and the Servicer hereby agree with the Collateral Agent for the
benefit of the Secured Parties (as hereinafter defined) as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Unless otherwise defined herein,
terms used herein shall have the meanings specified in the Credit Agreement
or the Security Agreement; as used in this Agreement, the following terms
shall have the following meanings:
“Account Agreement” means an agreement pursuant to which a
Receivable was incurred.
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“Agreement” means this Servicing Agreement, as it may from
time to time be amended, supplemented or otherwise modified in accordance
with the terms hereof
“Indemnified Amount” has the meaning specified in Section
5.09.
“Indemnified Parties” has the meaning specified in Section
5.09.
“Monthly Servicer Report” means a report of the Servicer in
the form of Exhibit A hereto.
“Put-Back Period” means, with respect to any Portfolio, the
time period (as specified in the Bank Agreement pursuant to which such
Portfolio was purchased) during which the Borrower may require the Selling
Bank to repurchase Designated Receivables in such Portfolio as a result of a
breach of representations or warranties or because they do not meet
eligibility standards.
“Servicing Fee'' has the meaning specified in Section 2.02.
The Servicing Fee shall be reduced by the applicable percentage (as set forth
in Section 2.02) of any Collections with respect to which the Servicing Fee
has already been paid which Collections are subsequently reversed for
insufficient funds or similar reasons.
“Servicer Termination Event” has the meaning specified in
Section 4.01.
Section 1.02 General. The words “herein,” “hereof,”
“hereunder,” and other words of similar import refer to this Agreement as a
whole, including the Schedules and Exhibits hereto, as the same may from time
to time be amended or supplemented, and not to any particular section,
subsection or clause contained in this Agreement. References herein to an
Exhibit, Schedule, Section, subsection or clause refer to the appropriate
Exhibit or Schedule to, or Section, subsection or clause in this Agreement.
Wherever from the context it appears appropriate, each term stated in either
the singular or plural shall include the singular and the plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter.
ARTICLE II
SERVICING AND ADMINISTRATION
Section 2.01 Servicing.
(a) The Servicer shall manage, collect and administer
all Designated Receivables, shall exercise all discretionary powers involved
in such management, collection and administration and shall, except as
otherwise specified in this Agreement, bear all costs and expenses incurred
in connection therewith that may be necessary or advisable and permitted for
carrying out the transactions contemplated by this Agreement, all in
accordance with the Collection Policies and
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Procedures and the other terms and conditions of this Agreement, including,
without limitation, determining whether and where to bring legal actions
against Obligors, including arranging with appropriate attorneys for the
bringing of such legal action and collecting judgments secured by such
attorneys. The Servicer shall have full power and authority, acting alone or
through any party properly designated by it, to do any and all things in
connection with such servicing, and administration which it may deem
necessary or desirable; provided, however, that the Servicer shall exercise
the same degree of care that it exercises in handling similar matters for its
own account and will create and administer policies and practices consistent
with the policies and practices applied with respect to its own receivables.
The Servicer shall comply at all times in all material respects with its
policies, practices, procedures and internal controls in effect at such time
with respect to the servicing and collection of the Designated Receivables.
The Servicer's management, collection and administration of the Designated
Receivables hereunder shall comply in all material respects with all
applicable Requirements of Laws. All servicing activities hereunder by the
Servicer and its employees shall be conducted from the Servicer's offices at
0000 Xxxxxx Xxxxx, Xxx Xxxxx, XX or at such other locations as to which the
Collateral Agent is provided 30 days' advance written notice.
(b) On the Initial Closing Date, the Lockbox, the
Lockbox Account, the Receivables Revenue Account and the Receivables Purchase
Account shall each have been established to the satisfaction of the
Collateral Agent. Except as set forth in the Collection Policies and
Procedures, the Servicer shall instruct Obligors making payments on
Designated Receivables to direct all such payments to the Lockbox.
(c) Except during the continuance of a Servicer
Termination Event, the Servicer shall deposit all Collections received by it
from time to time in the Lockbox Account as promptly as possible following
receipt thereof, but in no event later than the Business Day following such
receipt. All Collections received by the Servicer will, pending remittance to
the Lockbox Account, be held in trust by the Servicer for the benefit of the
Collateral Agent.
(d) Funds representing Collections on deposit in the
Lockbox Account shall be disbursed by the Lockbox Bank in accordance with the
Security Agreement. In no event shall the Servicer have any right to make any
withdrawals or transfers of Collections from the Lockbox Account except as
specified in this Agreement.
(e) Subject to Article IV, the obligation of the
Servicer to service the Designated Receivables is personal to the Servicer
and shall not be assignable by the Servicer without the prior written consent
of the Lender, which approval the Lender may withhold in its sole and
absolute discretion, and the parties recognize that it would be difficult for
any other Person to perform such obligations. Accordingly, the Servicer's
obligation to service the Designated Receivables hereunder shall be
specifically enforceable and shall be absolute and unconditional in all
circumstances, including, without limitation, after any termination of this
Agreement until the appointment of a successor servicer.
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(f) The Servicer's method of compensating its employees
who will be assigned to collection of the Designated Receivables (including
any incentive programs) is set forth on Exhibit B hereto. The Servicer shall
notify the Borrower and the Lender at least seven days prior to any change in
such method. Compensation levels shall be set by the Servicer in its sole
discretion.
(g) The Servicer shall maintain, at its sole expense,
an errors and omissions policy and a general comprehensive liability policy,
each with a financially sound and reputable insurer acceptable to the Lender.
Such errors and omissions policy shall insure the Servicer for not less than
$ 1,000,000 per occurrence and $5,000,000 in the aggregate and shall name the
Collateral Agent for the benefit of the Secured Parties as an additional
insurer or loss payee with respect to the Servicer's indemnification
obligations hereunder. The Servicer shall provide to the Collateral Agent and
the Lender, on the Initial Closing Date and from time to time thereafter upon
any change in or renewal of such errors and omissions policy, an original
certificate of insurance evidencing such policy. The Servicer shall not take
any action to cancel or terminate such policy unless a substantially similar
policy is in effect providing the same coverage. The Servicer shall instruct
its insurance carrier to notify the Borrower, the Lender and the Collateral
Agent concurrently with the delivery of any notice regarding the termination
or cancellation by the issuer of such policy.
(h) The Servicer shall create, on its system,
computerized records for all of the Designated Receivables, which records
shall include all of the information delivered to the Servicer by the
Borrower or a Selling Bank on each Closing Date and which records, from and
after the Closing Date, shall become the property of the Borrower, subject to
the lien and security interest of the Collateral Agent (for the benefit of
the Secured Parties) under the Security Agreement, and shall be updated by
the Servicer from time to time. When a Portfolio is delivered by the Borrower
to the Servicer for servicing hereunder, the Servicer shall, by not later
than the end of the Put-Back Period, identify Designated Receivables which
are subject to repurchase under the Bank Agreement related to such Portfolio
and promptly deliver to the Selling Bank, with copies to the Borrower, the
Lender and the Collateral Agent, a magnetic tape or diskette (accompanied by
a hard-copy printout) identifying such Designated Receivables and all other
documentation required to effectuate such repurchase under such Bank
Agreement. In addition, the Servicer shall handle all correspondence and
communications from Obligors in a manner similar to that in which it handles
the same with respect to its own receivables.
(i) In performing its services hereunder, the Servicer
shall (a) use the name of the Selling Bank only to the extent permitted under
the relevant Bank Agreement and (b) report all Designated Receivables to the
relevant credit bureau as being owned by the Borrower.
(j) In accordance with the Collection Policies and
Procedures, the Servicer shall offer Obligors the opportunity to enter into
Rewritten Receivables as a means of repaying their obligations. Notwithstanding
that the Servicer shall be the nominal party to the Rewritten Receivables, all
right, title and interest thereto shall be the exclusive property of the
Borrower subject to the lien and security interest of the Collateral Agent.
Immediately upon execution of any Rewritten Receivable, the Servicer shall affix
thereto a legend clearly stating that all right, title and
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interest thereto shall be the exclusive property of the Borrower subject to
the lien and security interest of the Collateral Agent. On the last Business
Day of each month, or at such other time as is requested by the Lender, the
Servicer shall deliver the original of each Rewritten Receivable to the
Collateral Agent.
Section 2.02 Servicing Compensation. As sole
compensation (except as specifically set forth herein) for its servicing
activities hereunder and reimbursement (except as specifically set forth
herein) for certain of its expenses as set forth herein, the Servicer shall
be entitled to receive a servicing fee (the “Servicing Fee”) in an amount
equal to [***%] of all Collections received by the Servicer and deposited
into the Lockbox Account; provided, however, that the Servicing Fee shall not
be payable with respect to (a) any Collections to the extent that they are a
result of repurchase of Designated Receivables by a Selling Bank or indemnity
payments from a Selling Bank, (b) the proceeds of any Disposition of
Designated Receivables deemed to be “uncollectible” under the Collection
Policies and Procedures or (c) the proceeds of any Securitization Transaction
involving Designated Receivables. The Servicing Fee shall be paid solely as
and to the extent set forth in Section 6 of the Security Agreement.
Except as otherwise specified herein, the Servicer's
expenses include all expenses
incurred by the Servicer in connection with its activities hereunder. The
Servicer shall be required to pay such expenses for its own account and shall
not be entitled hereunder to any payment or reimbursement therefore other
than the Servicing Fee.
Section 2.03 Representations and Warranties. The Servicer
hereby makes the following representations and warranties on which the Lender
has relied in making the Advances to the Borrower:
(a) Organization and Good Standing. The Servicer is a
corporation duly organized, validly existing and in good standing under the
laws of the State of California, and has full corporate power, authority and
the legal right to own its properties and conduct its business as now
conducted, and to execute, deliver and perform its obligations under this
Agreement and each other Program Document to which it is a Party.
(b) Due Qualification. The Servicer (i) is duly
qualified to do business and is in good standing as a foreign corporation in
each jurisdiction where such qualification is necessary in order to perform
its duties hereunder if the failure to be so qualified would have a Material
Adverse Effect, (ii) has obtained all licenses and approvals as required
under federal and state law that are necessary to perform its duties
hereunder, except where the failure to obtain such license or approval does
not materially adversely affect its ability to perform its obligations
hereunder and has no reasonable likelihood of resulting in any material
liability to the Borrower, the Lender or the Collateral Agent and (iii) is in
compliance with its certificate of incorporation and bylaws.
(c) Due Authorization. The execution, delivery and
performance of this Agreement and each Program Document to which it is a
party by the Servicer have been duly
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[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
authorized by all necessary corporate action on its part and do not and will
not contravene any provision of its certificate of incorporation or bylaws.
(d) Binding Obligation. This Agreement and each Program
Document to which it is a party constitutes the legal, valid and binding
obligation of the Servicer, enforceable against it in accordance with its
terms, subject to bankruptcy, insolvency or other similar laws affecting
creditors’ rights generally and to general principles of equity (whether
considered in a proceeding in equity or at law).
(e) No Conflict. The execution and delivery of this
Agreement and each Program Document to which it is a party by the Servicer,
the performance by the Servicer of the transactions contemplated by this
Agreement and each Program Document to which it is a party and the
fulfillment of the terms hereof and thereof applicable to the Servicer do not
and will not conflict with, violate, result in any breach of any of the terms
or provisions of, or constitute (with or without notice or lapse of time or
both) a default under, any Requirement of Law applicable to the Servicer or
any indenture, contract, agreement, mortgage, deed of trust or other
instrument to which it is a party or by which it or any of its properties is
bound.
(f) No Litigation. Except as otherwise disclosed in
writing to the Lender, there are no lawsuits, administrative proceedings or
investigations pending or, to the best knowledge of the Servicer, threatened
against the Servicer before any court, regulatory body, administrative agency
or other tribunal or governmental instrumentality relating to the Servicer's
collection activities which have a reasonable likelihood of resulting in
liability to the Servicer in excess of $ 10,000.
(g) All Consents Required. All approvals,
authorizations, consents, orders, licenses or other actions of any Person or
of any Governmental Authority required in connection with the execution and
delivery by the Servicer of this Agreement and each Program Document to which
it is a party, the performance by the Servicer of the transactions
contemplated by this Agreement and each Program Document to which it is a
party and the fulfillment by the Servicer of the terms hereof and thereof
have been obtained (or will be obtained prior to the time required) and are
in full force and effect.
(h) Taxes. The Servicer has filed all federal, state
and local tax returns, in each case required to be filed and has paid or made
adequate provision for the payment of all taxes, assessments and other
governmental charges shown due thereon except where such taxes, assessments
or charges are being contested in good faith.
(i) Compliance. The Servicer has complied with all
Requirements of Law in respect of the conduct of its business and ownership
of its property, except where the failure to comply does not materially
adversely affect its ability to perform its obligations hereunder or has no
reasonable likelihood of resulting in any material liability for the
Borrower, the Lender and the Collateral Agent.
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(j) Servicing. Since December 3 1, 1997, there
has been no material adverse change in the ability of the Servicer to manage,
collect or administer the Designated Receivables. The Servicer has delivered
to the Lender a true and complete copy of the Collection Policies and
Procedures.
Each of the representations and warranties set forth in this
Section 2.03(a) shall be deemed to be restated on each day on which Advances
are made under the Credit Agreement and shall survive execution and delivery
of this Agreement.
Section 2.04 Covenants of the Servicer. From and after the
Closing Date until this Agreement is terminated:
(a) Compliance with Requirements of Law. The
Servicer shall (i) duly satisfy its obligations in all material respects on
its part to be fulfilled under or in connection with each Designated
Receivable, including, without limitation, all of its obligations under each
Bank Agreement, (ii) maintain in effect all material qualifications required
under Requirements of Law in order to service properly each Designated
Receivable and (iii) comply in all material respects with all other
Requirements of Law in connection with servicing each Designated Receivable.
(b) No Rescission or Cancellation. The Servicer
shall not consent to any rescission or cancellation of any Designated
Receivable except as ordered by a court of competent jurisdiction or other
Governmental Authority or in accordance with the Collection Policies and
Procedures.
(c) Protection of Rights. The Servicer shall not
take any action, nor omit to take any action, which would materially impair
the rights of the Borrower, the Lender or the Collateral Agent in any
Designated Receivable, nor shall it reschedule, revise or defer payments due
on any Designated Receivable, except in accordance with the Collection
Policies and Procedures.
(d) Custodian, Further Assurances. The Servicer
shall, at its own cost and expense, (i) maintain books and records with
respect to the Designated Receivables and copies of all documents relating to
each of the foregoing, as well as all documents received from the Selling
Bank, as custodian for the Borrower and the Collateral Agent and (ii)
indicate clearly on the electronic records relating to the Designated
Receivables, including, without limitation, all such records received from
any Selling Bank, that the Designated Receivables have been transferred and
assigned to the Borrower and are subject to the lien and security interest of
the Collateral Agent and that all moneys payable thereunder have been
assigned to the Collateral Agent. The Servicer shall take all actions
requested by the Lender or the Collateral Agent in order to effectuate the
intentions of the parties hereto that the Collateral Agent be entitled to all
Collections and that the Designated Receivables be the sole property of the
Borrower subject to the lien and security interest of the Collateral Agent.
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(e) Information Furnished. All information furnished
by the Servicer to the Borrower, the Lender or the Collateral Agent with
respect to the Designated Receivables and the Collections will be true and
correct in all material respects at the time such information is furnished
and will not omit to state a material fact required to be stated therein or
necessary to make the statements contained therein not misleading under the
circumstances made.
(f) Taxes. The Servicer will file all federal, state
and local tax returns, in each case required to be filed by the Servicer and
pay or make adequate provision for the payment of all taxes, assessments and
other governmental charges shown due thereon except where such taxes,
assessments or charges are being contested in good faith.
(g) Collection Policies and Procedures. The
Servicer shall not amend or modify the Collection Policies and Procedures
without the prior written consent of the Lender.
(h) Servicer Not to Resign. The Servicer shall not
resign from the duties and obligations imposed upon it pursuant hereto except
upon its determination that its continued performance hereunder will no
longer be permissible under applicable law, as evidenced by an opinion of
counsel delivered to the Lender. No such resignation shall be effective until
the appointment of a successor servicer under Section 4.02.
Section 2.05 Monthly Servicer Reporting Requirements.
The Servicer shall provide the following reports and information to the
Lender and (with respect to subsection (a) below, to the Collateral Agent):
(a) Within 15 days following the end of each calendar
month, the Monthly Servicer Report with respect to all Designated Receivables
as of the end of such calendar month, and a magnetic medium containing a copy
of the Servicer's central data file pertaining to the Designated Receivables.
(b) Within 60 days following the end of each fiscal
quarter of the Servicer, unaudited financial statements for the Servicer,
including a balance sheet as of the end of such fiscal quarter and an income
statement for such fiscal quarter, all certified by the chief financial
officer of the Servicer as having been prepared in accordance with GAAP
consistently applied.
(c) Within 120 days following the end of the Servicer's
fiscal year, financial statements for the Servicer, including a balance sheet
as of the end of such fiscal year and an income statement for such fiscal
year, prepared in accordance with GAAP consistently applied and certified by
the Servicer's independent certified public accountants as having been so
prepared.
(d) Upon the reasonable request of the Lender, such
lists, records, statistics and credit information regarding the Designated
Receivables and the Collections as shall be requested by the Lender.
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(e) Promptly (but in any event not later than two
Business Days) after the Servicer's learning thereof, notice to the Borrower,
the Lender and the Collateral Agent of all litigation or administrative
proceedings commenced or threatened against the Servicer by Governmental
Authorities where the same has a reasonable likelihood of having a Material
Adverse Effect and of all other material litigation or administrative
proceedings commenced or threatened against the Servicer by Obligors,
including any and all written communications questioning the Servicer's
compliance, in any material respect, with any Requirement of Law, together
with regular (but not less frequently than monthly) updates as to material
developments regarding such litigation, proceedings or communications.
ARTICLE III
OTHER MATTERS RELATING TO THE SERVICER.
Section 3.01 Access to Certain Documentation and
Information Regarding the Designated Receivables. The Servicer shall provide
to the Borrower, the Lender and the Collateral Agent and each of their
respective agents and representatives full access to its books and records
relating to the Designated Receivables and to all documentation and other
computer records regarding the Designated Receivables, such access being
afforded without charge but only during normal business hours upon reasonable
advance notice, subject to the Servicer's normal security and confidentiality
procedures and at offices designated by the Servicer. Such access shall
include the ability to monitor telephone calls made to or received from
Obligors by employees of the Servicer.
Section 3.02 Merger. Consolidation or Transfer of
Assets. The Servicer shall not consolidate with or merge with or into any
other Person or convey or transfer its properties and assets substantially as
an entirety to any Person; provided, however, that the Servicer may merge or
consolidate with any Person if (a) after giving effect to such merger, no
Event of Default or Incipient Event of Default shall have occurred, (b) the
Person surviving such merger or consolidation agrees in writing to be bound
by the terms hereof and (c) the Servicer provides the Borrower, the Lender
and the Collateral Agent with prior written notice of such merger or
consolidation not less than 30 days prior thereto.
ARTICLE IV
SERVICER TERMINATION EVENTS
Section 4.01 Servicer Termination Events. If any
one of the following events (each, a “Servicer Termination Event”) shall
occur:
(a) any failure by the Servicer to make any payment,
transfer or deposit required pursuant to this Agreement within three Business
Days after it is due or to give instructions or notice within one Business
Day after it is required pursuant to this Agreement;
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(b) any failure on the part of the Servicer duly to
observe or perform in any material respect any of its other covenants or
agreements (not described in paragraph (a) above or (e) below) set forth in
this Agreement, or any provision of the Collection Policies and Procedures,
which failure materially adversely affects the rights of the Borrower, the
Lender or the Collateral Agent and continues unremedied for a period of 10
Business Days following the date of such failure provided, however, that if
any such default is, in the reasonable judgment of the Lender, remediable
within 180 days after its occurrence, such default shall not be an Event of
Default hereunder for such period of time (but not longer than 180 days
following the occurrence thereof) as the Servicer is attempting to remedy it;
(c) any representation, warranty or certification made
by the Servicer in this Agreement or in any certificate or report delivered
pursuant to this Agreement shall prove to have been incorrect in any material
respect when made provided, however, that if any such breach is, in the
reasonable judgment of the Lender, remediable within 180 days after its
occurrence, such breach shall not be an Event of Default hereunder for such
period of time (but not longer than 180 days following the occurrence
thereof) as the Servicer is attempting to remedy it;
(d) there shall occur a change in the stockholders of
the Servicer in which the majority control of the Servicer shall be
transferred to another Person or group of Persons (other than the Note
Purchaser and its Affiliates) acting in concert;
(e) the Servicer shall (i) fail to maintain insurance
as required pursuant to Section 2.0 1 (g), (ii) fail to follow any
instructions given by the Lender or the Collateral Agent in accordance
herewith within a reasonable period of time, (iii) fail to deliver any
Monthly Servicer Report required to be delivered under Section 2.05 within
three Business Days after the time set forth in such Section or (iv) be
unable to perform its responsibilities hereunder for 10 consecutive Business
Days due to any reason, including force majeure;
(f) the Servicer shall consent to the appointment of a
conservator, receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating
to it or of or relating to all or substantially all of its property, or a
decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator, receiver
or liquidator in any insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or for the winding-up or liquidation
of its affairs, shall have been entered against the Servicer and such decree
or order shall have remained in force undischarged or unstayed for a period
of 60 days; or the Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make any assignment for the
benefit of its creditors or voluntarily suspend payment of its obligations;
then, the Collateral Agent, upon receipt of instructions from the Lender, by
notice then given in writing to the Servicer, shall terminate all of the
rights and obligations of the Servicer under this
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Agreement; provided, however, that upon the occurrence of an event described
in subsection (f) above, such termination shall be automatic without notice
thereof by any party.
Section 4.02 Consequence of Termination or Resignation.
Upon the effectiveness of any termination hereof, all authority and power of
the Servicer under this Agreement shall terminate; and, without limitation,
the Lender or its designee is hereby authorized and empowered (upon the
failure of the Servicer to cooperate) to execute and deliver, on behalf of
the Servicer, as attorney-in fact or otherwise, all documents and other
instruments upon the failure of the Servicer to execute or deliver such
documents or instruments, and to do and accomplish all other acts or things
necessary or appropriate to effect the purposes of such transfer of servicing
rights. The Servicer agrees that no termination of this Agreement shall be
effective until such time as a successor servicer shall have been appointed
and that it will cooperate with the Collateral Agent and any successor
servicer in effecting the termination of the responsibilities and rights of
the Servicer to conduct servicing hereunder, including, without limitation,
the transfer to such successor servicer of all authority of the Servicer to
service the Designated Receivables provided for under this Agreement,
including, without limitation, all authority over all Collections which shall
on the date of transfer be held by the Servicer for deposit, or which have
been deposited by the Servicer in the Lockbox Account or the Receivables
Revenue Account, or which shall thereafter be received with respect to the
Designated Receivables. Upon any termination of the Servicer hereunder, the
Servicer shall promptly transfer its electronic records relating to the
Designated Receivables to the successor servicer in such electronic form as
such successor servicer may reasonably request and shall promptly deliver to
such successor servicer all other records, correspondence -and documents
necessary for the continued servicing of the Designated Receivables in the
manner and at such times as such successor servicer shall reasonably request.
ARTICLE V
MISCELLANEOUS
Section 5.01 Notices, etc. All notices and other
communications hereunder shall, unless otherwise stated herein, be in writing
(which shall include facsimile communication) and be faxed or delivered, to each
party hereto, at its address set forth under its name on the signature pages
hereof or at such other address as shall be designated by such party in a
written notice to the other parties hereto. Notices and communications by
facsimile shall be effective when sent (and shall be followed by hard copy sent
by regular mail), and notices and communications, sent by other means shall be
effective when received.
Section 5.02 Complete Agreement, Successors and Assigns.
Relationship of Parties. This Agreement constitutes the complete agreement between
the parties hereto with respect to the subject matter hereof and supersedes all
existing agreements and all oral, written or other communications between them
concerning its subject matter. This Agreement shall be binding upon
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the parties hereto and their respective successors and permitted assigns and
shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided that the Servicer shall not assign
any of its rights or obligations hereunder without the prior written consent
of the. Lender. The parties are entering into this Agreement as independent
contractors. In no event shall either party be deemed an agent, employee,
joint venturer or partner of the other.
Section 5.03 No Waiver. None of the undertakings,
agreements, warranties, covenants or representations of the Servicer
contained in this Agreement and no Servicer Termination Event shall be deemed
to have been suspended or waived unless such suspension or waiver is by an
instrument in writing signed by an officer of the Collateral Agent. Any
failure by the Borrower, the Lender or the Collateral Agent, at any time or
times, to require strict performance by any other party of any provision of
this Agreement shall not waive, affect or diminish its respective right
thereafter to demand strict compliance and performance therewith. Any
suspension or waiver by the Collateral Agent of a Servicer Termination Event
shall not suspend, waive or affect any other Servicer Termination Event,
whether the same is prior or subsequent thereto and whether of the same or of
a different type.
Section 5.04 Severability. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
Section 5.05 Amendments: Governing Law.This Agreement
and the rights and obligations of the parties hereunder (a) may not be
changed orally but only by an instrument in writing signed by the party
against which enforcement is sought and (b) shall be construed in accordance
with and governed by the laws of the State of New York.
Section 5.06 Setoff: The Servicer hereby irrevocably
and unconditionally waives all right of set-off that it may have under
contract (including this Agreement), applicable law or otherwise with respect
to any funds or monies of the Borrower, the Lender or the Collateral Agent at
any time held by or in the possession of the Servicer.
Section 5.07 Further Assurances. The Servicer
agrees to do such further acts and things and to execute and deliver to the
Borrower, the Lender and the Collateral Agent such additional assignments,
agreements, powers and instruments as are reasonably required by such Person
to carry into effect the purposes of this Agreement or to better assure and
confirm unto each such Person its rights, powers and remedies hereunder.
Section 5.08 Counterparts. This Agreement may be
executed in any number of copies (including copies sent by facsimile or other
electronic transmission), and by the different
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parties hereto on the same or separate counterparts, each of which shall be
deemed to be an original instrument.
Section 5.09 Indemnity by the Servicer.Without limiting
any other rights which the Borrower, the Lender or the Collateral Agent may
have hereunder or under applicable law, the Servicer hereby agrees to
indemnify the Borrower, the Lender-and the Collateral Agent and each of their
respective assigns, transferees, participants, employees and officers (each,
an “Indemnified Party”) from and against any and all damages, claims, losses,
liabilities and related costs and expenses, including reasonable attorneys'
fees and disbursements (all of the foregoing being collectively referred to
as “Indemnified Amounts”), awarded against or incurred by any Indemnified
Party arising out of or as a result of:
(a) the characterization in any Monthly Servicer Report
or other statement made by the Servicer of any Designated Receivable as an
Eligible Receivable which is not an Eligible Receivable as of the date of
such Monthly Servicer Report or statement;
(b) any representation or warranty or statement made or
deemed made by the Servicer (or any of its officers) under or in connection
with this Agreement which shall have been incorrect in any material respect
when made;
(c) the failure by the Servicer to comply with any
applicable law, rule or regulation with respect to any Designated Receivable;
or the failure of any Designated Receivable to conform to any such applicable
law, rule or regulation;
(d) any failure of the Servicer to perform its duties
or obligations in accordance with the provisions hereof,
(e) the commingling of Collections of Designated
Receivables by the Servicer at any time with other funds of the Servicer or
any of its Affiliates;
(f) any investigation, litigation or proceeding related
to this Agreement or in respect of any Designated Receivable or Related
Security, except to the extent any such investigation, litigation or
proceeding relates to a possible matter involving an Indemnified Party for
which neither the Servicer nor any of its Affiliates (other than the
Borrower) is at fault;
(g) any failure of the Servicer to comply with its
covenants contained herein; or
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(h) any claim brought by any Person other than an
Indemnified Party arising from any activity by the Servicer or any of its
Affiliates or any subservicer in servicing, administering or collecting any
Designated Receivable;
It is expressly agreed and understood by the parties hereto
(a) that the foregoing indemnification is not intended to, and shall not,
constitute a guarantee of the collectibility or payment of the Designated
Receivables and (b) that nothing in this Section 3.02 shall require the
Servicer to indemnify any Person (A) for Designated Receivables which are not
collected, not paid or uncollectable on account of the insolvency, bankruptcy
or financial inability to pay of the applicable Obligor (except to the extent
that any Designated Receivable was not an Eligible Receivable on the Closing
Date related thereto), (B) for damages, losses, claims or liabilities or
related costs or expenses resulting from such Person's gross negligence or
willful misconduct or (C) for any income taxes or franchise taxes incurred by
such Person arising out of or as a result of this Agreement or in respect of
any Designated Receivable. The obligations of the Servicer to indemnify the
Indemnified Parties hereunder shall survive the termination of this Agreement
or the resignation or removal of the Servicer. Following payment of
Indemnified Amounts hereunder by the Servicer, the Servicer shall be entitled
to assert any claims against any Selling Bank pursuant to the applicable Bank
Agreement that the Borrower would be entitled to assert in relation to the
matters in respect of which the Indemnified Amounts were paid.
If any Indemnified Party shall become aware of any even or
occurrence whereby it claims, or may claim or desire, indemnity hereunder,
such Indemnified Party shall notify the Servicer in writing promptly upon
becoming aware of such event or occurrence; provided, however, that failure
to provide such notice shall not relieve the Servicer of any of its
responsibilities under this Section 5.10. The Servicer at the request of any
Indemnified Party shall have the obligation to contest or defend against any
such event or occurrence, including any investigation, litigation, proceeding
or action giving rise to a claim for an Indemnified Amount, and the Servicer
in any event may participate in the defense thereof with legal counsel of its
choice. If any Indemnified Party requests the Servicer to defend against such
investigation, litigation, proceeding or action, the Servicer shall promptly
do so and the Indemnified Party shall have the right to participate in such
defense, at its expense, with legal counsel of its own choice. The Servicer
shall not settle, or enter into an agreement to settle, any such
investigation, litigation, proceeding or action without the prior written
consent of such Indemnified Party. Any and all amounts payable by the
Servicer as indemnification under this Section 5. 10 shall be due and payable
within ten days following the entry of a final non-appealable judgment in
respect of such amount, except that, if prior to such entry an Indemnified
Party at any time is required to pay such amount, the Servicer shall pay such
amount at such time.
Section 5.10 Headings. Section headings used in this
Agreement are for convenience of reference only and shall not affect the
construction or interpretation of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly
authorized as of the day and year first above written.
WEST CAPITAL RECEIVABLES
CORPORATION I
By: _____/s/ Xxxx X. Xxxxxxx, III _
Name: Xxxx X. Xxxxxxx, III
Title: President/CEO
0000 Xxxxxx Xx.
Xxx Xxxxx, XX 00000
WEST CAPITAL FINANCIAL SERVICES CORP.
By: _____/s/ Xxxx X.Xxxxxxx, III _
Name: Xxxx X. Xxxxxxx, III
Title: President/CEO
0000 Xxxxxx Xx.
Xxx Xxxxx, XX 00000
NORWEST BANK MINNESOTA, N.A.,
as Collateral Agent
By: _____/s/ Xxxxxx X. Wraalstad___
Name: Xxxxxx X.Xxxxxxxxx
Title: Corporate Trust Officer
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000
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