PURCHASE AGREEMENT
Dated as of June 13, 1997
between
X. X. XXXXXXXXX S.S.C. LIMITED PARTNERSHIP
as the Seller
and
X. X. XXXXXXXXX RECEIVABLES I LLC
as the Purchaser
TABLE OF CONTENTS
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Page
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ARTICLE I
DEFINITIONS
1.01. Certain Definitions...............................................................................2
1.02. Accounting Terms..................................................................................5
1.03. Other Terms.......................................................................................5
1.04. Computation of Time Periods.......................................................................5
ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
2.01. Purchases of Receivables; Agreement to Purchase...................................................6
2.02. Payment for the Purchases.........................................................................7
2.03. Payments and Computations, Etc....................................................................9
2.04. Transfer of Records to the Purchaser..............................................................9
ARTICLE III
CONDITIONS PRECEDENT
3.01. Conditions Precedent to Agreement................................................................10
3.02. Conditions Precedent to Ongoing Purchases........................................................11
3.03. Effect of Payment of Purchase Price and/or Contribution..........................................11
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Seller.....................................................12
4.02. Representations and Warranties of the Seller Relating to the Receivables.........................15
4.03. Representations and Warranties of the Purchaser..................................................15
ARTICLE V
GENERAL COVENANTS OF THE SELLER
5.01. Affirmative Covenants of the Seller..............................................................16
5.02. Negative Covenants of the Seller.................................................................19
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ARTICLE VI
ADMINISTRATION AND COLLECTION
6.01. Collection of Receivables........................................................................22
6.02. Servicing of Receivables.........................................................................23
6.03. Responsibilities of the Seller...................................................................23
6.04. Further Action Evidencing Purchases..............................................................24
ARTICLE VII
INDEMNIFICATION
7.01. Indemnities by the Seller........................................................................24
ARTICLE VIII
MISCELLANEOUS
8.01. Waivers; Amendments..............................................................................26
8.02. Notices..........................................................................................26
8.03. Effectiveness; Binding Effect; Assignability.....................................................27
8.04. GOVERNING LAW; WAIVER OF JURY TRIAL..............................................................27
8.05. Costs and Expenses...............................................................................28
8.06. Execution in Counterparts; Severability..........................................................28
8.07. Purchase Termination.............................................................................28
8.08. No Proceedings...................................................................................28
8.09. Entire Agreement.................................................................................29
8.10. Limitations on Liability.........................................................................29
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EXHIBITS AND SCHEDULES
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Exhibit A - Form of Subordinated Intercompany Revolving Loan Note
Exhibit B - Form of Seller Transfer Report
Exhibit C - List of Closing Documents
Schedule I - Addresses and Locations of Books and Records of the Seller
Schedule II - ERISA Matters
Schedule III - Lock-Box Banks; Lock-Box Accounts; Lock-Box Numbers;
Deposit Account Banks; Deposit Account Numbers
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PURCHASE AGREEMENT
Dated as of June 13, 1997
This PURCHASE AGREEMENT (the "Agreement"), dated as of June 13, 1997,
is made by and between X.X. XXXXXXXXX S.S.C. LIMITED PARTNERSHIP, a Delaware
limited partnership (the "Seller"), and X.X. XXXXXXXXX RECEIVABLES I LLC, a
Delaware limited liability company (the "Purchaser").
WITNESSETH:
WHEREAS, the Seller has purchased, and from time to time hereafter may
purchase, Settlements (or portions thereof) from various "Claimants" (as defined
in the Pooling and Servicing Agreement) pursuant to various "Settlement
Agreements" (as defined in the Pooling and Servicing Agreement) between the
Seller and each such Claimant;
WHEREAS, the Seller may from time to time desire to sell, transfer or
otherwise convey to the Purchaser, and the Purchaser may from time to time
desire to purchase or otherwise acquire or accept from the Seller, all of the
Seller's right, title and interest in the Receivables relating to certain such
"Settlements" (as defined in the Pooling and Servicing Agreement (or portions
thereof) now owned or hereafter acquired by the Seller, in each case, on the
terms and conditions provided herein; and
WHEREAS, in order to finance purchases of Receivables and the Related
Assets relating thereto, the Purchaser has entered into that certain Pooling and
Servicing Agreement, dated as of June 13, 1997 (as amended, restated,
supplemented (including by way of any "Supplement" (as defined in the Pooling
and Servicing Agreement) thereto) or otherwise modified from time to time, the
"Pooling and Servicing Agreement") among the Purchaser, X.X. Xxxxxxxxx &
Company, Inc. ("Wentworth"), as the initial "Master Servicer" thereunder, and
PNC Bank, National Association, as trustee (in such capacity, the "Trustee"),
pursuant to which the Purchaser has established a trust, SSC Master Trust I (the
"Trust"), to which the Purchaser may from time to time transfer or otherwise
convey specified Receivables in exchange for, among other things, cash generated
by the sale of trust certificates by the Trust and trust certificates payable to
the Purchaser;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, agree as follows:
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ARTICLE I
DEFINITIONS
SECTION 1.01. Certain Definitions. For all purposes of this Agreement,
as used in this Agreement (including in the recitals hereto), the following
terms shall have the following meanings:
"Aggregate Discounted Receivables Balance" means, for purposes
of this Agreement with respect to any designated group of Receivables, at any
time, the sum of the Discounted Receivables Balances of such Receivables at such
time.
"Applicable Discount Rate" shall mean, with respect to any
Receivable, the "Discount Rate" specified in the Designated Supplement to which
such Receivable shall be allocated as described in the applicable Seller
Transfer Report.
"Business Day" shall mean any day other than a Saturday or
Sunday or any other day on which national banking associations or state banking
institutions in New York, New York or Philadelphia, Pennsylvania are authorized
or obligated by law, executive order or governmental decree to be closed;
provided, however, that as it relates to any specific Series, the term "Business
Day" may have such other meaning, if any, as may be specified in the related
Supplement.
"Closing Date" shall mean June 13, 1997.
"Collateral Trustee" means the Person acting in such capacity under the
Intercreditor Agreement.
"Collections" shall mean all cash payments by or on behalf of the
Obligors (including, without limitation, pursuant to any "Annuity Contract" (as
defined in the Pooling and Servicing Agreement)) in respect of the Receivables
or the Related Property relating thereto, whether in the form of cash, checks,
wire transfers, electronic transfers or any other form of cash payment
(including, without limitation, from the Seller in connection with any
repurchase of any such Receivables from the Purchaser pursuant hereto).
"Collection Date" means that date following the Purchase Termination
Date upon which the Aggregate Discounted Receivables Balance of the Receivables
transferred to the Purchaser hereunder has been reduced to zero.
"Discounted Receivables Balance" means, at any time with respect to any
Receivable, the sum of (i) the discounted present values of the remaining
"Scheduled Payments" (as defined in the Pooling and Servicing Agreement) due
under such Receivable at such time discounted at the Purchase Discount Rate and
(ii) the principal amount of any past due Scheduled Payments outstanding on such
Receivable at such time.
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"Designated Supplement" has the meaning, with respect to any
Receivable, as is specified in the definition of "Eligible Receivable" below.
"Eligible Receivable" means, with respect to this Agreement, a
Receivable which, as of the date of its sale or conveyance to the Purchaser by
the Seller hereunder, would constitute an "Eligible Receivable" under and
pursuant to the Supplement for the "Series" (as defined in the Pooling and
Servicing Agreement) to which such Receivable is to be allocated and for which
such Receivable will be a "Series Receivable" (as defined in the Pooling and
Servicing Agreement); it being agreed that each Seller Transfer Report shall
designate the Supplement to which such Receivable shall be so allocated (such
Supplement so designated with respect to any such Receivable being the
"Designated Supplement" for such Receivable).
"Governmental Authority" shall mean any country or nation, any
political subdivision of such country or nation, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government of any country or nation or political subdivision
thereof.
"Intercreditor Agreement" shall mean that certain Collateral Trust and
Intercreditor Agreement, dated as of June 13, 1997, among ING (U.S.) Capital
Corporation, as contractual representative (the "Agent") for the benefit of the
financial institutions from time to time parties to the Revolving Credit
Facility (the "Lenders") and as a Lender, PNC Bank, National Association, as
servicing agent (the "Servicing Agent") and as a Lender, the Trustee, PNC Bank,
National Association, as Collateral Trustee, the Seller, the Purchaser and the
Master Servicer (as the same may be amended, restated, supplemented or otherwise
modified from time to time).
"Material Adverse Effect" shall mean, with respect to any Person, the
occurrence or existence of any event or condition which has a material adverse
effect (v) on such Person's ability to perform under the Operative Documents,
(w) on the businesses, properties or condition (financial or otherwise) of such
Person, (x) on the ability of the Purchaser or any of its designees and/or
assigns to enforce this Agreement or any of the other Operative Documents, (y)
on the rights of the Purchaser or any of its designees and/or assigns in the
Purchased Assets.
"Noncomplying Receivable" means any Receivable which, as of the date of
origination thereof, did not meet the criteria for an Eligible Receivable as of
such date.
"Permitted Liens" shall mean with respect to any Receivable or the
Related Asset relating thereto which are sold, transferred, or otherwise
conveyed to the Purchaser hereunder, "Liens" (as defined in the Pooling and
Servicing Agreement) created under the "Operative Documents" (as defined in the
Pooling and Servicing Agreement) (x) in favor of the Purchaser (and assigned to
the Trustee) or the Trustee, in either case, as against the Seller and (y) in
favor of the Trustee as against the Purchaser.
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"Person" shall mean any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
Governmental Authority or any other entity of similar nature.
"Purchase" means, on any Purchase Date, the sale, assignment,
contribution, transfer and/or other conveyance of any Receivable from the Seller
to the Purchaser for which the Purchase Price has not been previously paid
(including by increasing the outstanding balance of the Subordinated
Intercompany Revolving Loan Note) and which have not previously been sold,
assigned, contributed, transferred or otherwise conveyed to the Purchaser by the
Seller, in either case, in accordance with the terms of Sections 2.01 and 2.02
hereof; and "Purchased" means the past tense of Purchase.
"Purchase Date" means, with respect to any Receivable, the date such
Receivable is Purchased by the Purchaser.
"Purchase Discount Rate" means, with respect to any Receivable, a per
annum rate equal to the Applicable Discount Rate for such Receivable plus one
percent (1%), which rate shall be specified in the Seller Transfer Report; it
being understood and agreed that such rate may be determined as a weighted
average which may apply to all Receivables being Purchased on any given Purchase
Date.
"Purchase Price" has the meaning specified in Section 2.02(b) hereof.
"Purchase Termination Date" means the earliest to occur of (i) the date
upon which the Seller shall cease to sell Receivables to the Purchaser in
accordance with the provisions of Section 8.07 of this Agreement, (ii) the date
upon which the ability of the Seller to permit Purchases hereunder has been
terminated (and cannot be reinstated) pursuant to Section 2.01(c) of this
Agreement, and (iii) or the date upon which the Seller breaches its repurchase
or substitution obligation as set forth in Section 5.02(b).
"Purchase Yield" means, with respect to any Receivable, the per annum,
discount rate, as calculated by the Seller on the date the Settlement underlying
such Receivable was originally purchased by the Seller from the Claimant, at
which the present value of all "Scheduled Payments" (as defined in the Pooling
and Servicing Agreement) (or portions thereof) to be received by the Seller
equals the sum of the purchase price paid by the Seller to the Claimant therefor
plus the estimated closing costs and commissions incurred by the Seller and
directly allocated to such Receivable in accordance with the Seller's customary
past business practices.
"Purchased Assets" shall mean all Receivables and Related Assets
purchased hereunder pursuant to Section 2.01.
"Receivable" shall mean those Scheduled Payments (or portions thereof)
due to a Claimant under a Settlement Agreement and the rights to which Scheduled
Payments (or such
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portion thereof) have heretofore been or which are hereafter transferred by such
Claimant to the Seller pursuant to a Settlement Purchase Agreement and by the
Seller to the Purchaser pursuant to this Agreement, whether such Scheduled
Payments (or such portions thereof) constitute accounts, general intangibles,
investment property, chattel paper, instruments, documents, securities, cash, or
any other kind of property.
"Related Assets" has the meaning specified in Section 2.01(a) hereof.
"Related Property" means with respect to any Receivable: all of the
Seller's rights, remedies, powers and privileges (a) under the Settlement
Purchase Agreement pursuant to which such Receivable was purchased by the Seller
and under the related "Power of Attorney" (as defined in the Pooling and
Servicing Agreement), (b) all security interests or liens and property subject
thereto from time to time purporting to secure payment of such Receivable, if
any, whether pursuant to the Settlement Purchase Agreement related to such
Receivable or otherwise, (c) under the "Back-up Servicing Agreement" (as defined
in the Pooling and Servicing Agreement), (d) all "Lock-Box Accounts" (as defined
in the Pooling and Servicing Agreement), lock-boxes and other bank accounts, in
each case, into which (but only to the extent of) any "Collections" (as defined
in the Pooling and Servicing Agreement) are deposited or concentrated; all
monies and other items of payment therein (but only to the extent relating to
the Receivables); and "Eligible Investments" (as defined in the Pooling and
Servicing Agreement) purchased with any of the foregoing funds and any
investment income thereon, (e) all "Life Insurance Contracts" (as defined in the
Pooling and Servicing Agreement) relating to any "Non-Guaranteed Settlements"
(as defined in the Pooling and Servicing Agreement) or "Commutable Settlements"
(as defined in the Pooling and Servicing Agreement) included as a Receivable,
(f) any interest rate hedging instruments or agreements entered into by the
Seller in respect of any such Receivable, (g) any other agreements or
arrangements of whatever character (including guaranties, letters of credit,
annuity contracts (including, "Qualified Annuity Contracts" (as defined in the
Pooling and Servicing Agreement)) or other credit support) from time to time
supporting or securing payment of such Receivable whether pursuant to any
related Settlement Agreement, "Qualified Assignment" (as defined in the Pooling
and Servicing Agreement), Qualified Annuity Contract, Settlement Purchase
Agreement or any other agreement related to such Receivable or otherwise, (h)
all "UCC" (as defined in the Pooling and Servicing Agreement) financing
statements filed by the Seller against the Claimants under such Receivable; and
(j) all "Records" (as defined in the Pooling and Servicing Agreement) and all
other instruments and rights relating to such Receivable.
"Revolving Credit Facility" means that certain Amended and Restated
Credit Agreement, dated as of February 11, 1997 (as the same may be amended
restated, supplemented or otherwise modified from time to time) and all
documents, instruments and agreements executed and/or delivered in connection
therewith.
"Seller Loans" has the meaning specified in Section 2.02(c) hereof.
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"Seller Transfer Report" means a report to be delivered by the Seller
to the Purchaser and accepted by the Purchaser on each Purchase Date setting
forth for each such Receivable so Purchased, the name of the Claimant, the
present and future values of the assigned Scheduled Payments, the "Annuity
Provider" (as defined in the Pooling and Servicing Agreement), if any, the
Purchase Price thereof, the Purchase Yield, the Applicable Discount Rate and
Purchase Discount Rate thereof, and the Designated Supplement under which such
Receivable is intended to be an Eligible Receivable.
"Series Specific Lock-Box Account" has the meaning specified in Section
6.01(a) hereof.
"Subordinated Intercompany Revolving Loan Note" has the meaning
specified in Section 2.02(d) hereof.
"Subsequent Issuances" means any issuance of new "Certificates" (as
defined in the Pooling and Servicing Agreement) on any date after the Closing
Date.
"U.S. Dollars" or "Dollars" means dollars of the United States of
America.
SECTION 1.02. Accounting Terms. Under this Agreement, all accounting
terms not specifically defined herein shall be interpreted, all accounting
determinations made, and all financial statements prepared, in accordance with
GAAP.
SECTION 1.03. Other Terms. All other undefined terms contained in this
Agreement shall, unless the context indicates otherwise, have the meanings
provided for by the UCC to the extent the same are used or defined therein. The
words "herein," "hereof," and "hereunder" and other words of similar import
refer to this Agreement as a whole, including the exhibits and schedules 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, and all
references to Sections, Exhibits and Schedules shall mean, unless the context
clearly indicates otherwise, the Sections hereof and the Exhibits and Schedules
attached hereto, the terms of which Exhibits and Schedules are hereby
incorporated into this Agreement. Whenever appropriate, in the context, terms
used herein in the singular also include the plural, and vice versa.
SECTION 1.04. Computation of Time Periods. In this Agreement, in the
computation of a period of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding", and the word "within" means "from and excluding a
specified date and to and including a later specified date."
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ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES
SECTION 2.01. Purchases of Receivables; Agreement to Purchase. (a)
Subject to the terms and conditions hereinafter set forth (including the
conditions set forth in Article III), at any time prior to the Purchase
Termination Date (provided such Purchases are permitted pursuant to Section
2.01(d) hereof) upon at least one Business Days' prior notice by the Seller to
the Purchaser, the Purchaser shall purchase from the Seller, and the Seller
shall sell, transfer, assign and otherwise convey to the Purchaser all of the
Seller's right, title and interest in the Receivables described on the Seller
Transfer Reports from time to time delivered by the Seller to the Purchaser on
or prior to the proposed respective Purchase Dates therefor (as such dates shall
be specified in such notices), in each case together with all of the Related
Property relating to such Receivables and all Collections with respect to and
other proceeds of such Receivables and "Related Security" (as defined in the
Pooling and Servicing Agreement) (such Related Property, Collections and
Proceeds, collectively, the "Related Assets"); it being agreed that the first
such Purchase Date shall be on the Closing Date (and the execution and delivery
of this Agreement shall suffice as notice thereof by the Seller for purposes of
this Agreement). On any Purchase Date on which the Seller and Purchaser agree to
effect a sale or transfer of Receivables preceding the Purchase Termination
Date, the Purchaser shall pay for the Purchases described in the preceding
sentence no later than 5:00 p.m. (New York time) on such Purchase Date by making
available to the Seller the payment of the Purchase Price in the manner required
under Section 2.02. Prior to paying the Purchase Price hereunder, the Purchaser
may request of the Seller, and the Seller shall deliver, such approvals,
opinions, information, reports or documents as the Purchaser may reasonably
request.
(b) It is the intention of the parties hereto that each Purchase of
Receivables and the associated Related Assets made hereunder shall constitute a
"sale" from the Seller to the Purchaser under applicable state law and Federal
bankruptcy law, which sales are, in each case, absolute and irrevocable and
provide the Purchaser with all indicia and rights of ownership of the
Receivables and such Related Assets. Neither the Seller nor the Purchaser
intends the transactions contemplated hereunder to be, or for any purpose to be
characterized as, loans from the Purchaser to the Seller secured by such
property. Except for certain indemnities pursuant to Section 7.01, each sale of
Receivables and the associated Related Assets by the Seller to the Purchaser is
made without recourse to the Seller; provided, however, that (i) the Seller
shall be liable to the Purchaser for all representations, warranties and
covenants made by the Seller pursuant to the terms of this Agreement, and (ii)
such sale does not constitute and is not intended to result in an assumption by
the Purchaser or any assignee thereof of any obligation of the Seller or any
other person to any Claimant, Obligor, "Liable Party" (as defined in the Pooling
and Servicing Agreement) or any other Person in connection with the Receivables,
the Related Assets and/or the related Settlement Purchase Agreements, or any
other obligations of the Seller thereunder or in connection therewith, other
than to return (or provide for the return of) any Scheduled Payments (or any
portion thereof) not covered under the Settlement Purchase
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Agreement and not sold to the Purchaser hereunder back to such Claimant (it
being understood and agreed that the Master Servicer and/or the Collateral
Trustee shall remit or cause to be remitted all amounts in respect of "Split
Payments" (as defined in the Pooling and Servicing Agreement) in accordance with
Section 5.01(f)). In view of the intention of the parties hereto that the
Purchases of Receivables and the associated Related Assets made hereunder shall
constitute sales of such Receivables and such Related Assets rather than a loan
secured by such Receivables and such Related Assets, the Seller agrees to note
on its financial statements and in its books an records that such Receivables
and the associated Related Assets have been sold to the Purchaser and to respond
to any inquiries made by third parties as to the ownership of such Receivables
and such Related Assets so sold that such Receivables and such Related Assets
have been sold to the Purchaser.
(c) Notwithstanding any other provision of this Agreement to the
contrary, the Purchaser shall not Purchase from the Seller nor shall the Seller
sell to the Purchaser any Receivable from and after the time of any bankruptcy
filing by or against the Seller or the Purchaser, provided, however, that should
any such bankruptcy or insolvency proceeding instituted against the Seller (as
distinguished from by the Seller) be withdrawn or dismissed prior to the
occurrence of a "Significant Event" under the Pooling and Servicing Agreement,
then the Purchaser shall be entitled to resume Purchasing Receivables from the
Seller after the withdrawal or dismissal of such filing or proceeding.
(d) If, notwithstanding the provisions of the immediately preceding
clause (b), a court of competent jurisdiction were to hold that any Purchase of
Receivables hereunder does not constitute a valid sale of the affected
Receivables and the Related Assets as set forth above but instead constitutes a
loan in the amount of the Purchase Price of such Receivables, then this
Agreement shall be deemed a present grant of a security interest (within the
meaning of Articles 8 and 9 of the UCC as in effect in all applicable
jurisdictions) in favor of the Purchaser in all of the Seller's rights, title
and interest in, to and under the Purchased Assets to secure such loan in the
amount of the Purchase Price effective upon each such Purchase, and the Seller
hereby grants such a security interest to the Purchaser in the Purchased Assets
which are the subject of such Purchase, and this Agreement shall constitute a
security agreement within the meaning of Article 8 and Article 9 of the UCC of
all applicable jurisdictions.
SECTION 2.02. Payment for the Purchases. (a) Except as otherwise
provided below in this Section 2.02, the Purchase Price for the Receivables sold
by the Seller under this Agreement shall be payable in full in cash by the
Purchaser to the Seller, in each case on the Purchase Date relating to such
Purchase; provided, however, that with respect to the Purchase made on the
Closing Date, [$________] of the Purchase Price due on the Closing Date shall be
paid by the issuance of equity in the Purchaser to the Seller pursuant to the
terms of the organizational documents of the Purchaser.
(b) On each Purchase Date with respect to any Receivables being sold on
such date, the Seller shall deliver to the Purchaser a Seller Transfer Report in
the form of that attached
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hereto as Exhibit B. The Purchaser, if it agrees to purchase all such
Receivables set forth on such report, shall signify its acceptance thereof by
signing such report and returning a copy, as accepted, to the Seller on such
date, together with payment of the aggregate Purchase Price for such
Receivables, by no later than 5:00 p.m. (New York time) on such date. To the
extent that the Purchaser disputes any of the information in such report with
respect to any Receivable described therein, the Seller and the Purchaser shall
reconcile such report as promptly as possible and if unable to reconcile and
agree on the content of such report prior to 4:30 p.m. (New York time) on the
proposed Purchase Date therefor, the Seller and the Purchaser shall exclude any
Receivables therefrom until such report is acceptable to both parties (and such
excluded Receivables shall be deemed not sold on such date). The aggregate
Purchase Price (as hereinafter defined) payable on any Purchase Date shall be
calculated to equal the sum of the respective Purchase Prices of the new
Receivables noted on such Seller Transfer Report. The "Purchase Price" for any
Receivable shall be equal to the Discounted Receivables Balance of such
Receivable on such date as calculated without giving effect to any past due
Scheduled Payments thereon which are outstanding on such date.
(c) On each Business Day, to the extent that the Purchaser receives
proceeds from any "Subsequent Issuances" (as defined in the Pooling and
Servicing Agreement) or otherwise has any other "Available Seller Funds" (as
defined in the Pooling and Servicing Agreement), then the Purchaser shall remit
such funds to the Seller in the following order of priority and application:
first to pay the Purchase Price for any Receivables Purchased from the Seller on
such Business Day to the extent it is a Purchase Date; and second to pay amounts
owed by the Purchaser to the Seller under the Subordinated Intercompany
Revolving Loan Notes described in Section 2.02(d) below. If, on any Purchase
Date, the amount of cash available to pay for all Purchases of Receivables to be
made on such date is less than the Purchase Price owing therefor, then the
Purchaser shall, with notice to the Seller, pay such remaining part of the
Purchase Price by borrowing a revolving loan (each a "Seller Loan") under its
Subordinated Intercompany Revolving Loan Note issued in favor of the Seller, and
the Seller shall have irrevocably agreed to advance, and shall be deemed to have
advanced, a Seller Loan in the amount so specified by the Purchaser; provided,
however, that such Seller Loan shall be made to the Purchaser only to the extent
that such Seller Loan shall be payable out of "Available Seller Funds" (as
defined in the Pooling and Servicing Agreement), and, at the time of such Seller
Loan, or immediately thereafter and after giving effect to such Seller Loan, the
Purchaser would, in the reasonable determination of the Purchaser, continue to
be able to pay its debts as they become due.
(d) The Seller Loans shall be subordinated to the prior right and
payment in full of all Certificates and other amounts required to be paid by the
Purchaser under the Operative Documents and any other "Indebtedness" (as defined
in the Pooling and Servicing Agreement) of the Purchaser which is specified in
any document relating thereto as having priority over the Seller Loans. The
Seller Loans advanced by the Seller shall be evidenced by, and payable in
accordance with the terms and provisions of, a promissory note (a "Subordinated
Intercompany Revolving Loan Note") payable to the Seller in the form of Exhibit
A attached hereto.
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SECTION 2.03. Payments and Computations, Etc. All amounts to be paid by
the Seller to the Purchaser hereunder shall be paid in accordance with the terms
hereof no later than 1:00 P.M. (New York time) on the day when due in Dollars in
immediately available funds to the "Master Collection Account" (as defined in
the Pooling and Servicing Agreement). All amounts to be paid by the Purchaser to
the Seller hereunder shall be paid in accordance with the terms hereof no later
than 5:00 P.M. (New York time) to such account as may be specified therefor by
the Seller from time to time by notice to the Purchaser. Payments received by
the Purchaser or the Seller after such times shall be deemed to have been
received on the next Business Day. In the event that any payment becomes due on
a day which is not a Business Day, then such payment shall be made on the next
succeeding Business Day. The Seller and the Master Servicer (if an "Affiliated
Entity" (as defined in the Pooling and Servicing Agreement)) shall, to the
extent permitted by law, pay to the Purchaser, on demand, interest on all
amounts not paid when due hereunder (whether owing by the Seller individually or
as Master Servicer) at 2% per annum above the per annum rate designated by PNC
Bank, National Association as its "prime rate" for commercial borrowers (such
rate not necessarily being the lowest rate offered by such bank) as in effect on
the date such payment was due; provided, however, that such interest rate shall
not at any time exceed the maximum rate permitted by applicable law. All
computations of interest payable hereunder shall be made on the basis of a year
of 360 days for the actual number of days (including the first but excluding the
last day) elapsed.
SECTION 2.04. Transfer of Records to the Purchaser. (a) In connection
with the Purchases of Receivables hereunder, the Seller hereby sells, transfers,
assigns and otherwise conveys to the Purchaser all of the Seller's right and
title to and interest in the Records relating to all Receivables included in the
Purchased Assets, without the need for any further documentation in connection
with any Purchase. In connection with such transfer, the Seller hereby
represents and warrants that the Seller and/or Wentworth either itself owns, or
has taken such action as may be necessary (including, without limitation,
obtaining any necessary consents from licensors or other Persons) to provide the
Master Servicers, the "Back-up Servicer" (as defined in the Pooling and
Servicing Agreement), the Trustee and any "Successor Servicer" (as defined in
the Pooling and Servicing Agreement) with such licenses, sublicenses and/or
assignments of contracts as the Master Servicers, the Trustee or any Successor
Servicer shall from time to time require for its use of all services and
computer hardware or software that relate to the servicing of the Receivables or
the other Purchased Assets. The Seller and Wentworth each hereby grants the
Master Servicers, the Back-up Servicer, the Trustee and each Successor Servicer
an irrevocable license (with respect to the services, and computer hardware and
software that it owns) or sublicense (with respect to all other such services,
hardware and software) to use such services, hardware or software in connection
with the servicing, collection and monitoring of the Receivables (subject to
reasonable confidentiality restrictions and restrictions limiting such use to
the collection, servicing and monitoring of the Receivables, which restrictions
have already been established with respect to the Back-up Servicer and, with
respect to any other Person other than the Back-up Servicer, shall be determined
at such time as such Person is charged with the servicing of the Receivables).
As of the Closing Date, all such computer software and hardware is currently
owned by Seller and/or Wentworth and is licensed to the Back-up Servicer
irrevocably until the
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termination of the Back-up Servicing Agreement. From and after the Closing Date,
the Seller or Wentworth, as applicable, shall deliver to the Trustee a copy of
each consent (or evidence that such consent is not required) from all necessary
parties with respect to any such services, hardware or software prior to the
date the Seller or Wentworth enters into any license to use such service or
software to service, monitor and collect any Receivables. The license granted
hereby shall be irrevocable, and shall terminate on the Business Day following
the Collection Date.
(b) The Seller shall take such action requested by the Purchaser (or
its assignees) or any Master Servicer (including any successor Master Servicer
appointed in accordance with the Pooling and Servicing Agreement), from time to
time hereafter, that may be reasonably necessary or appropriate to ensure that
the Purchaser (and its assignees, including, without limitation, the Trustee,
the Collateral Trustee and the Certificateholders) has an enforceable ownership
or security interest, as applicable, in the Records relating to the Receivables
purchased from the Seller hereunder.
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.01. Conditions Precedent to Agreement. This Agreement is
subject to the conditions precedent that (i) each of the conditions precedent to
the execution, delivery and effectiveness of each other Operative Document
(other than a condition precedent in any such other Operative Document relating
to the effectiveness of this Agreement) shall have been fulfilled, and (ii) the
Purchaser shall have received each of the following, on or before the Closing
Date, each (unless otherwise indicated) dated as of the Closing Date or such
other recent date acceptable to the Purchaser and each in form and substance
satisfactory to the Purchaser:
1. Resolutions. A copy of the resolutions of the Board of Directors of
the general partner of the Seller, certified by its Secretary or Assistant
Secretary, approving for and on behalf of the Seller this Agreement and the
other Operative Documents to be delivered by it hereunder and the
transactions contemplated hereby and thereby and addressing such other
matters as may be reasonably required by the Purchaser;
2. Good Standing Certificates of the Seller; Certificates as to Foreign
Qualification of the Seller. Good standing or qualification certificates
for the Seller issued by the Secretaries of State of Delaware and
Pennsylvania and of any other state in which the Seller transacts business
and is required to be in good standing;
3. Incumbency Certificate. A certificate of the Secretary or Assistant
Secretary of the general partner of the Seller certifying the names and
true signatures of the officers authorized on the general partner's behalf
to sign this Purchase Agreement for and on behalf of the Seller and the
other Operative Documents to be delivered by the
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Seller hereunder (on which certificate the Purchaser, the Trustee, the
Agent and the Master Servicers may conclusively rely until such time as the
Purchaser shall receive from the Seller (with a copy to the Trustee, each
Master Servicer and the Agent), a revised certificate meeting the
requirements of this subsection (3);
4. Other Operative Documents. Original copies, executed by each of the
parties thereto in such reasonable number as shall be specified by the
Purchaser, of each of the other Operative Documents to be executed and
delivered in connection herewith;
5. Release of Liens under the Revolving Credit Facility. With respect
to the Receivables to be Purchased on or after the Closing Date, the
Intercreditor Agreement shall provide for the release upon the Purchase
thereof pursuant hereto of all Liens previously granted by the Seller or
the Purchaser under the Revolving Credit Facility or otherwise with respect
to such Receivables and Related Assets;
6. Opinions of Counsel. The following opinions of counsel, each in form
and substance satisfactory to the Purchaser as to (i) general corporate and
UCC matters, (ii) true sale and non-consolidation, (iii) federal and
Delaware income tax matters, (iv) assignability and priority of the
Receivables, (v) federal securities law issues, and (vi) enforceability of
Powers of Attorney; and
7. Other Documents. Such other documents as are set forth on the List
of Closing Documents attached hereto as Exhibit C.
SECTION 3.02. Conditions Precedent to Ongoing Purchases. The obligation
of the Purchaser on any Purchase Date to accept and pay the Purchase Price for
the transfers of Receivables under this Agreement is subject to the conditions
precedent that the representations and warranties contained in Article IV are
true and correct in all material respects as of such Business Day. The Seller,
by accepting the Purchase Price paid for each Purchase of Receivables and
Related Assets hereunder (including by way of increase in the principal balance
of the Subordinated Intercompany Revolving Loan Note or the equity interest of
the Seller in the Purchaser), shall be deemed to have certified, with respect to
the Receivables and the Related Assets paid for on such day, that its
representations and warranties contained in Article IV are true and correct on
and as of such day, with the same effect as though made on and as of such day.
SECTION 3.03. Effect of Payment of Purchase Price and/or Contribution.
Upon the payment of the Purchase Price for any Purchase, (whether in cash by an
equity issuance to the Seller or by an increase in the Seller's Subordinated
Intercompany Revolving Loan Note pursuant to Section 2.02(c)), or in the case of
a Purchase made on the Closing Date, the contribution of any Receivables and
Related Assets by the Seller to the capital of the Purchaser pursuant to Section
2.02(a), title to the Receivables and the Related Assets included in such
Purchase shall vest in the Purchaser. Upon the purchase and payment by the
Purchaser of the Purchase Price for
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any Purchase, each of the conditions set forth in Section 3.02 shall be
irrevocably deemed to have been satisfied.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Seller. The Seller
hereby represents and warrants that as of the Closing Date and (except for
representations and warranties which relate to a specific date only) and on each
"Transfer Date" (as defined in the Pooling and Servicing Agreement) thereafter
until the Purchase Termination Date:
(a) Organization and Good Standing. The Seller is a limited
partnership, duly organized, validly existing and in good standing under the
laws of the State of Delaware and has full power and authority to own its
properties and conduct its business as presently owned or conducted, and to
execute, deliver and perform its obligations under this Agreement, the
Settlement Purchase Agreements, and each of the other Operative Documents to
which it is a party.
(b) Due Qualification. The Seller is duly qualified to do business and
is in good standing as a foreign limited partnership, and has obtained all
necessary licenses and approvals, in each jurisdiction in which failure to so
qualify or to obtain such licenses and approvals would have, or could reasonably
be expected to have a Material Adverse Effect.
(c) Due Authorization; Conflicts. The execution, delivery and
performance by the Seller of this Agreement, the Settlement Purchase Agreements
and each of the other Operative Documents to which it is a party are within the
Seller's powers, have been duly authorized by all necessary partnership action,
and do not contravene (i) the Seller's Agreement of Limited Partnership, (ii)
any law, rule, regulation, order, decree or contractual restriction binding on,
or affecting, the Seller and the violation of which would have, or could
reasonably be expected to have, a Material Adverse Effect, or (iii) any
agreement, contract, indenture, mortgage, or other instrument, document or
agreement to which the Seller or any of its assets are subject or may be
effected and the violation of which would have, or could reasonably be expected
to have, a Material Adverse Effect.
(d) Consents. No authorization or approval or other action by, and no
notice to or registration of or filing with, any Governmental Authority or other
regulatory body is required to be made by the Seller for the due execution,
delivery and performance by the Seller, or to insure the legality, validity,
binding effect or enforceability of, this Agreement, the Settlement Purchase
Agreements or any of the other Operative Documents to which it is a party,
except for the filing of UCC financing statements against the Seller in respect
of the transactions contemplated herein, all of which that need to be filed to
perfect the interest of the Purchaser in the Purchased
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Assets (as comprised as of the date of the making or remaking of this
representation and warranty) have been so made.
(e) Enforceability. This Agreement, the Settlement Purchase Agreements
or any of the other Operative Documents to which it is a party is and will be
the legal, valid and binding obligation of the Seller enforceable against the
Seller in accordance with its respective terms, except as such enforceability
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights generally
or general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(f) Proceedings. There are no judgments or other judicial or
administrative orders outstanding against the Seller nor is there any pending
or, to the best of the Seller's knowledge, threatened action or proceeding
affecting the Seller before any court, governmental agency or arbitrator, which
would have, or could reasonably be expected to have, a Material Adverse Effect.
(g) Compliance with Laws, Etc. The Seller is not in violation of any
law, rule, regulation, order, writ, judgment, decree, determination or award
applicable to it or any of its properties or any indenture, lease, loan or other
agreement to which it is a party or by which it or its assets may be bound or
affected, the violation of which, in any of the foregoing cases, would have, or
could reasonably be expected to have, a Material Adverse Effect.
(h) Locations. The principal place of business and chief executive
office of the Seller are located at the address of the Seller set forth on the
signature page hereof, and the offices where the Seller keeps all of its records
relating to the Receivables are located at the addresses set forth on Schedule I
hereto, or, in each case, at such other locations notified to the Purchaser, the
Trustee and each Master Servicer, and the Agent, in jurisdictions with respect
to which all applicable actions required by Section 5.02(f) hereof have been
taken and completed.
(i) Lock-Box Banks. The names and addresses of all the "Lock-Box Banks"
(as defined in the Pooling and Servicing Agreement), and the account numbers of
all "Lock-Box Accounts" (as defined in the Pooling and Servicing Agreement) and
related lock-boxes such Lock-Box Banks, are in each case specified in Schedule
III hereto or have been notified to the Purchaser, the Trustee and the
Collateral Trustee and with respect to which all action required to be taken
pursuant to Section 5.02(h) has been taken. The Lock-Box Banks are the only
institutions holding any Lock-Box Accounts or lock-boxes for the receipt of
Scheduled Payments in respect of the Receivables. All Annuity Providers have
been directed to make payments on the Annuity Contracts relating to the
Receivables to a Lock-Box Account (or a related lock-box) covered by a "Lock-Box
Notice" (as defined in the Pooling and Servicing Agreement), and such
instructions are in full force and effect.
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(j) Financial Statements. The annual audited financial statements of
the Seller for the fiscal year ended December 31, 1996, and the unaudited
quarterly financial statements of the Seller for the fiscal quarter ended March
31, 1997, copies of which have been provided to the Purchaser, the Trustee and
the Agent, present fairly the financial condition of the Seller as of such date.
(k) Accuracy of Information. Each certificate, information, exhibit,
financial statement, document, book, record, report or disclosure furnished by
the Seller to the Purchaser, the Trustee, any Master Servicer or the Agent is
accurate in all material respects and contains no untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained herein and therein not misleading.
(l) Investment Company Act Matters. The Seller is not an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act.
(m) Title to Property. The Seller, with respect to any Receivables
immediately prior to the Purchase thereof by the Purchaser hereunder, had good,
indefeasible, and merchantable title to and ownership of such Receivables, free
and clear of all Liens.
(n) Tradenames. The Seller has no tradenames, fictitious names, assumed
names or "doing business as" names and since its incorporation, the Seller (i)
has not been the subject of any merger or other corporate reorganization that
resulted in a change of name, identity or corporate structure or (ii) had any
other name.
(o) Solvency. After giving effect to each Purchase of Purchased Assets
hereunder, the Seller is and will be solvent and able to pay its debts as they
come due, and has and will have adequate capital.
(p) Valid Transfer. This Agreement constitutes a valid sale, transfer
and assignment to the Purchaser of all right, title and interest of the Seller
in and to the Receivables now or hereafter Purchased hereunder and in and to all
other Purchased Assets and the proceeds thereof free and clear of any Lien,
other than any Permitted Lien or, if a court of competent jurisdiction were to
hold that any Purchase of Receivables hereunder does not constitute a valid sale
of the affected Receivables and the Related Assets as set forth herein but
instead constitutes a loan in the amount of the Purchase Price of such
Receivables, constitutes a valid grant to the Purchaser of a "security interest"
(as defined in the UCC of the jurisdiction the law of which governs the
perfection of the interest in the Receivables and other Purchased Assets created
hereunder), which is and shall be a first priority perfected security interest
to secure such loan in the amount of the Purchase Price, free and clear of any
Lien (other than any Permitted Lien) in all right, title and interest of the
Seller in and to the Receivables now or hereafter Purchased by the Purchaser
pursuant hereto and in and to all other Purchased Assets and the proceeds
thereof
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which will be enforceable by the Purchaser (and its assignees or pledgees) upon
such creation of such security interest.
(q) Originator Receivables. The Purchaser has given reasonably
equivalent value to the Seller (which may include an equity issuance on the
Closing Date and additional indebtedness of the Purchaser under the Subordinated
Intercompany Revolving Loan Note) in consideration for the Purchase by the
Purchaser from the Seller of the Receivables and Related Property pursuant
hereto, and no such transfer has been made for or on account of an antecedent
debt owed by the Seller to the Purchaser.
SECTION 4.02. Representations and Warranties of the Seller Relating to
the Receivables. The Seller hereby represents and warrants to the Purchaser,
with respect to each Receivable Purchased by the Purchaser pursuant hereto,
that:
(a) On the Purchase Date therefor the representations and warranties
set forth in the Designated Supplement relating to such Receivable (as set forth
in the applicable Seller Transfer Report delivered by the Seller on such
Purchase Date) under the heading of "Representations and Warranties of the
Seller Relating to the Series Trust Assets" or other similar heading or
otherwise relating specifically to the Receivables with respect to (and
allocated to or serving as collateral under) such Designated Supplement, shall
be true and correct in all material respects (and such representations and
warranties shall be deemed incorporated herein by this reference hereto).
(b) From and after the Closing Date, the Credit Policy Manual shall
provide that, upon the receipt of payment of less than the full amount of any
Scheduled Payments in respect of any Receivable in respect of which there is a
concurrent obligation of the Seller to remit a Split Payment to the Claimant
thereon, such Scheduled Payment shall be remitted to the Seller and the
applicable Claimant pro rata based on the relative percentages of the full
amount of such Scheduled Payment which each would be entitled to received (had
the full payment been received) in accordance with the terms of the applicable
Settlement Purchase Agreement.
The representations and warranties made pursuant to this Section 4.02
on the date of any Purchase of Receivables by the Purchaser shall survive such
Purchase.
SECTION 4.03. Representations and Warranties of the Purchaser. The
Purchaser represents and warrants that as of the Closing Date and (except for
representations and warranties which relate to a specific date only) as of each
Purchase Date:
(a) Corporate Existence and Power. The Purchaser is a limited liability
company duly organized, validly existing and in good standing under the laws of
its jurisdiction of incorporation and has all corporate power and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business in each jurisdiction in which its business is now conducted. The
Purchaser is duly qualified to do business in, and is in good standing in,
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every other jurisdiction in which the nature of its business requires it to be
so qualified, except where the failure to be so qualified or in good standing
would not have a Material Adverse Effect.
(b) Corporate and Governmental Authorization; Contravention. The
execution, delivery and performance by the Purchaser of this Agreement and the
other Operative Documents to which it is a party (i) are within the Purchaser's
limited liability company powers, (ii) have been duly authorized by all
necessary limited liability company action, (iii) require no action by or in
respect of, or filing with, any Governmental Authority or official thereof, or
(iv) do not contravene, or constitute a default under, any provision of
applicable law, rule or regulation or of the Purchaser's Organizational
Documents or of any agreement, judgment, injunction, order, writ, decree or
other instrument binding upon the Purchaser the contravention of which, in any
of the foregoing cases would have, or could reasonably be expected to have, a
material adverse effect on the Purchaser's ability to perform hereunder or on
the enforceability hereof.
(c) Binding Effect. Each of this Agreement and the Subordinated
Intercompany Revolving Loan Notes constitutes the legal, valid and binding
obligation of the Purchaser, enforceable against it in accordance with its
terms, subject to applicable bankruptcy, insolvency, moratorium or other similar
laws affecting the rights of creditor generally or general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law).
ARTICLE V
GENERAL COVENANTS OF THE SELLER
SECTION 5.01. Affirmative Covenants of the Seller. At all times from
the date hereof to the Collection Date, Seller will, unless the Purchaser shall
otherwise consent in writing:
(a) Compliance with Law. The Seller will comply in all material
respects with all Requirements of Law applicable to the Purchased Assets.
(b) Preservation of Existence. The Seller will preserve and maintain
its existence, rights, franchises and privileges as a limited partnership (or
other legal entity, provided the Seller shall have complied with the
requirements of Section 5.02(f)) in the jurisdiction of its organization, and
qualify and remain qualified in good standing as a foreign business entity in
each jurisdiction where the failure to maintain such qualification would have,
or could reasonably be expected to have, a Material Adverse Effect.
(c) Inspection of Books and Records. The Purchaser, the Agent, their
respective assigns (or designated representative thereof) and independent
accountants appointed by, or other agents of, any of the foregoing, shall have
the right, upon reasonable prior written notice to the Seller, to visit the
Seller, to discuss the affairs, finances and accounts of the Seller with, and to
be
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advised as to the same by, its officers, and to examine the books of account and
records of the Seller, and to make or be provided with copies and extracts
therefrom, all at such reasonable times and intervals (but not more than once in
any six month period) and to such reasonable extent during regular business
hours as the Purchaser, the Agent, their respective assigns (or designated
representative thereof) or such accountants or agents appointed by any of the
foregoing, as applicable, may desire.
(d) Keeping of Records and Books of Account. (i) The Seller itself or
through its agents will keep proper books of record and account, which shall be
maintained or caused to be maintained by the Seller and shall be separate and
apart from those of any Affiliate of the Seller, in which full and correct
entries shall be made of all financial transactions and the assets and business
of the Seller in accordance with generally accepted accounting principles
consistently applied, and (ii) maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing the Receivables in the event of the destruction of the
originals thereof) and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection of all
Receivables (including, without limitation, records adequate to permit the daily
identification of all Collections of and adjustments to each existing
Receivable).
(e) Location of Records. The Seller will keep its principal place of
business and chief executive office at the address of the Seller referred to in
Section 4.01(h) and shall keep the other offices where it keeps the books,
records and documents regarding the Purchased Assets at the addresses of the
Seller referred to on Schedule I, or in either case, upon 30 days' prior written
notice to the Purchaser, the Trustee and each Master Servicer and the Agent, at
any other location within the United States with respect to which all applicable
action required by Section 5.02(f) hereof shall have been taken and completed.
(f) Settlement Purchase Agreement. The Seller will at its expense
timely perform and comply in all material respects with all provisions,
covenants and other promises required to be observed by it under each Settlement
Purchase Agreement, maintain each Settlement Purchase Agreement in full force
and effect, enforce each Settlement Purchase Agreement in accordance with its
respective terms, and, at the request of the Purchaser, the Trustee, or any
applicable Master Servicer, make to the Claimant such reasonable demands and
requests for information and reports or for action as, the Trustee, or any
applicable Master Servicer may request to the extent that the Seller is entitled
to do the same thereunder; it being agreed however that with respect to the
obligations of the Seller to remit Split Payments to the Claimant pursuant to
the Settlement Purchase Agreements relating to the Purchased Assets, such
obligation shall hereafter be performed by the Master Servicer and/or the
Collateral Trustee, in each case, under and pursuant to the Pooling and
Servicing Agreements.
(g) Payment of Taxes, Etc. The Seller will pay promptly when due all
material taxes, assessments and governmental charges or levies imposed upon it
in respect of the Purchased Assets, or in respect of its income or profits
therefrom, and any and all material claims
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of any kind (including, without limitation, claims for labor, materials and
supplies) in respect of the Purchased Assets, except where such tax, assessment,
charge or levy is being contested in good faith and by proper proceedings and
adequate reserve have been set up and are being maintained in respect thereof on
the Seller's books and records.
(h) Collections. In the event that the Seller or any other Affiliated
Entity receives any Collections, the Seller agrees to hold, or cause such
Affiliated Entity to hold, all such Collections in trust and to deposit such
Collections to a Lock-Box Account or the Master Collection Account, in each
case, as soon as practicable, but in no event later than two Business Days after
its receipt thereof.
(i) Fidelity Insurance. The Seller shall maintain, at its own expense,
a fidelity insurance policy, with broad coverage with responsible companies on
all officers, employees or other persons acting on behalf of the Seller in any
capacity with regard to the Receivables to handle documents and papers related
thereto. Any such fidelity insurance shall protect and insure the Seller against
losses, including forgery, theft, embezzlement, and fraud, and shall be
maintained in an amount of at least $10,000,000 or such lower amount as the
Purchaser or any of its assigns may in their commercially reasonable credit
judgment designate to the Seller from time to time. No provision of this Section
5.01(i) requiring such fidelity insurance shall diminish or relieve the Seller
from its duties and obligations as set forth in this Agreement or any of the
other Operative Documents. The Seller shall be deemed to have complied with this
provision if one of its respective Affiliates has such fidelity policy coverage
and, by the terms of such fidelity policy, the coverage afforded thereunder
extends to the Seller. Upon the request of the Purchaser or any of its assigns,
the Seller shall cause to be delivered to the Purchaser or such assigns, as
applicable, a certification evidencing coverage under such fidelity policy. Any
such insurance policy shall contain a provision or endorsement providing that
such policy may not be canceled or modified in a materially adverse manner
without ten (10) days' prior written notice to the Purchaser and such assigns.
(j) Protection of Right, Title and Interest to Purchaser and Assignees.
(i) The Seller shall cause all financing statements and continuation
statements and any other necessary documents covering the Purchaser's and
its assignees' right, title and interest in and to the Purchased Assets to
be promptly recorded, registered and filed, and at all times to be kept
recorded, registered and filed, all in such manner and in such places as
may be required by law to preserve and protect fully the right, title and
interest of the Purchaser and its assignees in and to all such Purchased
Assets. The Seller shall cooperate fully with the Master Servicers and
Agent and take such actions as any such Person shall reasonably request, in
order to carry out the objectives of this Agreement and the other Operative
Documents.
(ii) Within 30 days after the Seller makes any change in its name,
identity or corporate structure which would make any financing statement or
continuation statement
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filed in accordance with the terms of this Agreement seriously misleading
within the meaning of Section 9-402(7) (or any comparable provision) of the
UCC as in effect in the jurisdiction the law of which governs the
perfection of the interest in the Purchased Assets created hereunder, the
Seller shall give the Purchaser, the Agent and the Trustee notice of such
change and shall file such financing statements or amendments as may be
necessary to continue the perfection of the Purchaser's and its Assignees'
interest in the Purchased Assets and the proceeds thereof.
(iii) Notwithstanding anything contained herein to the contrary, the
Seller shall not be required to file assignments in favor of the Purchaser
or the Trustee, respectively, with respect to the UCC financing statements
filed by the Seller against each of the Claimants in connection with the
respective Settlement Purchase Agreements, but the Seller hereby covenants
to file continuation statements thereof as and when necessary to maintain
the effectiveness of such statements; it being understood and agreed that
the Seller shall not have any duty to monitor the continued effectiveness
of the financing statements originally filed against such Claimants (other
than with respect to the lapse thereof due to time).
(k) Corporate Separateness. The Seller shall at all times deal with the
Purchaser in a manner consistent with Section 2.06(m) of the Pooling and
Servicing Agreement.
(l) Accounting For Purchases. The Seller shall treat all Purchases
hereunder by the Purchaser as sales and absolute transfers thereof for all tax,
accounting and other purposes.
SECTION 5.02. Negative Covenants of the Seller. From the date hereof
until the Collection Date, the Seller shall not, without the written consent of
the Purchaser:
(a) No Liens. The Seller will not sell, pledge, assign or transfer to
any Person, or grant, create, incur, assume or suffer to exist any Lien (other
than a Permitted Lien) on, any Purchased Asset, whether now existing or
hereafter created, or any interest therein, and the Seller shall defend the
right, title and interest of the Purchaser in and to the Purchased Assets,
whether now existing or hereafter created, against all claims of third parties
claiming through or under the Seller.
(b) Extension or Amendment of Receivables. The Seller will not extend,
amend or otherwise modify (or consent to any such extension, amendment or
modification of) the terms of any Receivable or rescind or cancel, or permit the
rescission or cancellation of, any Receivable except to the extent that any
representation or warranty of the Seller with respect to any Receivable
constituting a Purchased Asset under Section 4.02 was incorrect when made or
remade or deemed made or remade (it being agreed that the incorrectness of any
such representation or warranty, and the substitution or repurchase obligation
of the Seller pursuant to this clause (b) resulting therefrom, shall in each
case, be determined without giving effect to any limitation on the "knowledge,"
"best of knowledge" or other similar limitation on the knowledge
-20-
of the Seller contained in any such representation or warranty), the Seller
shall, within five Business Days after learning thereof, either (X) convey to
the Purchaser in exchange for the affected Receivable, one or more additional
Receivables to be described on a Seller Transfer Report delivered to the
Purchaser and having Discounted Receivables Balance (as calculated without
giving effect to any past due Scheduled Payments thereon which are outstanding
on such date) approximately equal to, but not less than, the Discounted
Receivables Balance of the Receivable being so replaced (as calculated by
treating any past-due Scheduled Payments then due as if such Scheduled Payments
were due on the date of such calculation) or (Y) in the event the Seller lacks
sufficient Receivables to substitute or replace the affected Receivables,
repurchase in cash delivered to the Purchaser as aforesaid, in an amount equal
to the Discounted Receivables Balance (as calculated by treating any past-due
Scheduled Payments then due as if such Scheduled Payments were due on the date
of such calculation) of such affected Receivable at such time, whereupon the
Receivable being replaced or repurchased shall cease to be a "Receivable"
hereunder.
(c) Change in Credit Policy Manual. The Seller will not make, or
consent or fail to object to, any change in the "Credit Policy Manual" (as
defined in the Pooling and Servicing Agreement) which change could be reasonably
likely to materially impair or delay the collectibility of any Receivable or
result in a deterioration in the creditworthiness of the Obligors generally.
(d) Deposits to Lock-Box Accounts or the Master Collection Account. The
Seller will not deposit or otherwise credit, or cause to be so deposited or
credited, or consent or fail to object to any such deposit or credit, to any
Lock-Box Account or the Master Collection Account of cash proceeds other than
Collections of Receivables and other Purchased Assets; provided that to the
extent any such other amounts are so deposited on any date, it shall not
constitute a breach hereunder if such other funds are identified and are removed
from such account within two Business Days after such amounts were so deposited
in such account.
(e) Receivables Not To Be Evidenced by Promissory Notes. The Seller
will take no action to cause any Receivable to be evidenced by any "instrument"
(as defined in the UCC of the jurisdiction the law of which governs the
perfection of the interest in such Receivable created hereunder), except in
connection with its enforcement, in which event the Seller shall deliver such
instrument to the Collateral Trustee, for the benefit of the Person entitled
thereto or secured thereby in accordance with the Intercreditor Agreement.
(f) Change in Name. The Seller will not (i) make any change to its
name, principal place of business, partnership structure or location of books
and records or use any tradenames, fictitious names, assumed names or "doing
business as" names unless, at least 30 days prior to the effective date of any
such name change, change in principal place of business, change in partnership
structure, change in location of its books and records, or change in trade or
fictitious names, the Seller notifies the Purchaser, the Trustee and each Master
Servicer thereof and delivers to the Trustee and the Purchaser such financing
statements (Forms UCC-1 and
-21-
UCC-3) executed by the Seller which the Purchaser or the Trustee may reasonably
request to reflect such name change, location change, change in partnership
structure or fictitious name change or use, together with such other documents
and instruments that the Purchaser or the Trustee may reasonably request in
connection therewith and has taken all other steps to ensure that the Purchaser,
and the Trustee continue to have a first priority, perfected security or
ownership interest in the Purchased Assets, or (ii) change its jurisdiction of
organization unless the Purchaser and the Trustee shall have received from the
Seller (A) written notice of such change at least 10 days prior to the effective
date thereof, and (B) prior to the effective date thereof if the Purchaser shall
so request, an Opinion of Counsel, in form and substance reasonably satisfactory
to the Purchaser and the Trustee, as to such organization and the Seller's valid
existence and good standing and as to the matters referred to in the first
sentence of Section 4.01(a).
(g) Merger. The Seller shall not consolidate with or merge into any
other Person or convey or transfer its properties and assets substantially as an
entirety to any Person unless:
(i) (X) the Person formed by such consolidation or into which the
Seller is merged or the Person which acquires by conveyance or transfer the
properties and assets of the Seller substantially as an entirety shall be,
if the Seller is not the surviving entity, a corporation, limited
partnership or limited liability company organized and existing under the
laws of the United States of America or any State or the District of
Columbia, and such entity shall have expressly assumed, by an agreement
supplemental hereto, executed and delivered to the Trustee, in form
reasonably satisfactory to the Purchaser and the Trustee the performance of
every covenant and obligation of the Seller hereunder and (Y) the Seller
shall have delivered to the Purchaser and the Trustee an Officer's
Certificate and an Opinion of Counsel each in form reasonably satisfactory
to the Purchaser and the Trustee and stating that such consolidation,
merger, conveyance or transfer complies with this Section 5.02(g) and that
all conditions precedent herein provided for relating to such transaction
have been complied with;
(ii) each "Rating Agency" (as defined in the Pooling and
Servicing Agreement) rating any Series shall have notified the Purchaser
and the Trustee, in writing, that such merger or consolidation or
conveyance or transfer, as the case may be, will not result in a reduction
or withdrawal of the rating of any such outstanding Series or "Class" (as
defined in the Pooling and Servicing Agreement) of such Series; and
(iii) the corporation, limited partnership or limited liability
company formed by such consolidation or into which the Seller is merged or
which acquires by conveyance or transfer the properties and assets of the
Seller substantially as an entirety shall have all licenses and approvals
to perform its obligations hereunder and under the other Operative
Documents to which the Seller is a party, except to the extent the failure
to have any such license would not have, and could not reasonably be
expected to have, a
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material adverse effect on its ability to perform the obligations of the
Seller hereunder and/or any such other Operative Document.
(h) Change in Lock-Box Accounts and Instructions to Obligors. The
Seller will not add or terminate any institution as a Lock-Box Bank or terminate
or substitute any Lock-Box Account or any related lock-box from those listed in
Schedule III hereto, except as otherwise permitted hereunder or unless the
Purchaser, the Trustee and the Collateral Trustee shall have received notice of
such addition, termination or change and executed copies of Lock-Box Notices
covering any such new Lock-Box Bank, Lock-Box Account or any new lock-box
relating thereto. The Seller will not instruct any Obligor to remit Collections
to any Person, address or account other than a Lock-Box Account or the related
lock-box to which the underlying Receivables or Purchased Assets relates.
(i) If, and for so long as, the Seller or the Purchaser shall be the
sole beneficial owner of all of the 5.00% Class B Structured Settlement-Backed
Pass Through Trust Certificates, Series 1997-1, the Seller or the Purchaser, as
the case may be, shall not for federal income tax purposes be a corporation,
shall not elect to be taxed for federal income tax purposes as an association
taxable as a corporation and shall not incorporate.
ARTICLE VI
ADMINISTRATION AND COLLECTION
SECTION 6.01. Collection of Receivables. (a) The Seller and the
Purchaser each hereby acknowledges and agrees that (i) the Collateral Trustee
has the exclusive ownership, dominion and control of any and all Lock-Boxes and
Lock-Box Accounts, other than any Lock-Box and/or Lock-Box Account into which
only Collections with respect to one particular Series are deposited (any such
Series-specific Lock-Box and Lock-Box Account being a "Series Specific Lock-Box"
and "Series Specific Lock-Box Account", respectively) and (ii) the Trustee has
the exclusive ownership and control of each Series Specific Lock-Box and Series
Specific Lock-Box Account and in either case, the Seller hereby agrees to take
any further action necessary or that the Trustee, the Collateral Trustee, the
Agent or the Purchaser may reasonably request to evidence and/or effect such
ownership and control. Unless instructed otherwise by the Collateral Trustee or
the Trustee, as applicable, pursuant to either such Person's authority under the
Intercreditor Agreement and the Pooling and Servicing Agreement, each Lock-Box
Bank shall be instructed to remit, on a daily basis, via overnight or same day
transfer, all amounts deposited in its Lock-Box Accounts to the Master
Collection Account in accordance with the terms of a Lock-Box Notice
substantially in the form of Exhibit B to the Pooling and Servicing Agreement.
The Master Servicer (or any successor Master Servicer (including the Back-Up
Servicer) appointed for any such Master Servicer) and the Seller, pursuant to
each Daily Report shall advise the Purchaser daily of the amount of Collections
received into the Master Collection
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Account on such day with respect to the Receivables and the allocations thereof
as among the Series, the Split Payments, and the Revolving Credit Facility. If
the Seller or its agents or representatives shall at any time receive any cash,
checks or other instruments constituting Collections, such recipient shall
segregate such payment and hold such payment in trust for and in a manner
acceptable to the Purchaser and shall, promptly upon receipt (and in any event
within one Business Day following receipt), remit all such cash, checks and
instruments, duly endorsed or with duly executed instruments of transfer, to a
Lock-Box Account or Series Specific Lock-Box Account, as the case may be, or the
Master Collection Account. The Seller hereby authorizes the Purchaser (and its
designees and assigns), and gives each of the Purchaser, such designees and/or
such assigns its irrevocable power of attorney, with full power of substitution,
which authorization shall be coupled with an interest, to take any and all steps
in the Seller's name and on behalf of the Seller, which steps are necessary or
desirable, in the reasonable determination of the Purchaser, such designees
and/or such assigns, to collect all amounts due under the Purchased Assets,
including, without limitation, endorsing the Seller's name on checks and other
instruments representing Collections and enforcing such Receivables and the
related Settlement Purchase Agreements.
(b) The Purchaser shall, following notification that collections of any
receivable or other intangible owed to the Seller thereof, which is not a
Purchased Asset, have been deposited into the Lock-Box Accounts or Series
Specific Lock-Box Accounts, as the case may be, segregate all such collections
and, after such misapplied collections have been reasonably identified to the
Purchaser, the Purchaser shall turn over to the Seller, as applicable, all such
collections less all reasonable and appropriate out-of-pocket costs and
expenses, if any, incurred by the Purchaser in collecting such receivables.
SECTION 6.02. Servicing of Receivables. (a) From and after the Purchase
of any Receivable by the Purchaser from the Seller, the Purchaser (or its
designees or assignees) shall have the sole right to service, administer and
monitor the Receivables and the Seller shall cease to have any rights whatsoever
in connection with such Receivables constituting Purchased Assets. In connection
therewith, the Seller shall deliver all books and records relating to the
Receivables to the Purchaser (or its agent or assign as so designated by the
Purchaser) promptly after the Purchase thereof by the Purchaser, and shall take
such other action as shall be reasonably requested by the Purchaser (or its
agents or assigns) to further evidence such assignment or to assist in the
servicing, monitoring, collecting and administering the Receivables sold
hereunder.
(b) Grant of Power of Attorney. The Seller hereby authorizes the
Purchaser (and its designees and assigns), and gives each of the Purchaser and
such designees and/or assigns its irrevocable power of attorney, with full power
of substitution, which authorization shall be coupled with an interest, to take
any and all steps in the Seller's name and on behalf of the Seller, which steps
are necessary or desirable in the reasonable determination of the Purchaser,
such designees and/or assigns to endorse, negotiate, deposit or otherwise
realize on any Receivable or any writing of any kind in connection with any
Receivable or Purchased Asset.
-24-
SECTION 6.03. Responsibilities of the Seller. Anything herein to the
contrary notwithstanding:
(a) Subject to the allocation of the obligations in respect of Split
Payments pursuant to Section 5.01(f), the Seller shall perform all of its
obligations under the Settlement Purchase Agreements related to the Receivables
sold by it hereunder to the same extent as if such Receivables had not been sold
hereunder and the exercise by the Purchaser (or any of its assignees) of its
respective rights hereunder shall not relieve the Seller from such obligations.
(b) The Purchaser and its assignees shall have no obligation or
liability with respect to any Receivable or related Settlement Purchase
Agreement, nor shall the Purchaser or any such assignee be obligated to perform
any of the obligations of the Seller thereunder.
(c) The Seller shall, upon the request of the Purchaser (or its agents
or assigns) deliver to the Purchaser, such agents and/or assigns, as directed,
all Records that evidence or relate to the Receivables and other Purchased
Assets conveyed to the Purchaser under this Agreement.
SECTION 6.04. Further Action Evidencing Purchases. (a) The Seller
agrees that at any time and from time to time, at its expense, it will promptly
execute and deliver all further instruments and documents, and take all further
action that may be reasonably necessary to perfect, protect or more fully
evidence the Purchaser's and its assignees' respective interests in the
Purchased Assets, or to enable the Purchaser and/or such assignees (or any agent
or designee of any of the foregoing) to exercise or enforce any of their
respective rights hereunder. Without limiting the generality of the foregoing,
the Seller will (i) execute and file such financing or continuation statements,
or amendments thereto or assignments thereof, and such other instruments and
notices, as may be necessary or appropriate or as the Purchaser or its assignees
may reasonably request, and (ii) xxxx its master data processing records
evidencing such Receivables and related Settlement Purchase Agreements with a
legend indicating that such assets have been sold to the Purchaser, and (iii)
indicate on its financial statements that its Receivables have been sold to the
Purchaser pursuant to this Agreement.
(b) If the Seller fails to perform any of its agreements or
obligations under this Agreement, following expiration of any applicable cure
period, the Purchaser (or any assignee thereof) may (but shall not be required
to) perform, or cause performance of, such agreement or obligation, and the
reasonable expenses of the Purchaser (or any such assignee) incurred in
connection therewith shall be payable by the Seller upon the Purchaser's (or any
such assignee's) written demand therefor (which demand shall itemize such
expenses in reasonable detail).
ARTICLE VII
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INDEMNIFICATION
SECTION 7.01. Indemnities by the Seller. Without limiting any other
rights which the Purchaser may have hereunder or under applicable law, but
without duplication, the Seller hereby agrees to indemnify the Purchaser and its
permitted successors and assigns and all officers, directors, agents and
employees of the foregoing (each of the foregoing Persons being individually
referred to herein as an "Indemnified Party") from and against any and all
damages, losses, claims, judgments, liabilities and related costs and expenses,
including reasonable attorneys' fees and disbursements, awarded against or
incurred by any Indemnified Party relating to or resulting from or in connection
with any of the following (collectively, the "Indemnified Losses", and each an
"Indemnified Loss"), other than any such Indemnified Loss (x) constituting
recourse for Receivables which are uncollectible for credit reasons or (y) which
arise solely from the gross negligence or willful misconduct of the affected
Indemnified Party:
(i) the sale of any Non-Complying Receivable to the Purchaser pursuant
hereto;
(ii) reliance on any representation or warranty made in writing by the
Seller (or any of its officers) under or in connection with this Agreement,
any Seller Transfer Report or any "Monthly Report" (as defined in the
Pooling and Servicing Agreement), or reliance on any other information or
report delivered by the Seller or by the Master Servicer with respect to
the Seller (to the extent based on information provided by the Seller)
pursuant hereto, which shall have been false, incorrect or materially
misleading in any respect when made (it being agreed that the incorrectness
of any such representation or warranty, and the substitution or repurchase
obligation of the Seller pursuant to this clause (ii) resulting therefrom,
shall in each case, be determined without giving effect to any limitation
on the "knowledge," "best of knowledge" or other similar limitation on the
knowledge of the Seller contained in any such representation or warranty);
(iii) the failure by the Seller to comply with any term, provision or
covenant contained in this Agreement, or any agreement executed in
connection with this Agreement or with any applicable law, rule or
regulation with respect to any Receivable, the related Settlement Purchase
Agreement or the "Related Security" (as defined in the Pooling and
Servicing Agreement), or the nonconformity of any Receivable, the related
Settlement Purchase Agreement or the Related Security with any such
applicable law, rule or regulation;
(iv) the failure to vest and maintain vested in the Purchaser or to
transfer to the Purchaser, legal and equitable title to, and first priority
perfected ownership of, the Receivables and other Purchased Assets which
are, or are purported to be, sold or otherwise transferred by the Seller
hereunder, free and clear of any Lien (other than Liens created in favor of
the Purchaser hereunder and Liens created under the other Operative
Documents);
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(v) the failure to file, or any delay in filing, financing statements
or other similar instruments or documents under the UCC of any applicable
jurisdiction or other applicable laws with respect to any Receivables and
other Purchased Assets which are, or are purported to be, sold or otherwise
transferred by the Seller hereunder, whether at the time of any Purchase or
at any subsequent time;
(vi) the failure by the Seller to be duly qualified to do business, to
be in good standing or to have filed appropriate fictitious or assumed name
registration documents in any jurisdiction;
(vii) the failure of the Seller to pay when due any sales taxes or
other governmental fees or charges imposed in connection with the transfer
of the Purchased Assets hereunder;
(viii) the failure of the Seller or any of its agents, employees or
representatives to remit to the Purchaser, Collections of Purchased Assets
remitted to the Seller or any such agent, employees or representatives in
accordance with the terms hereof; and
(ix) the assignment by a Claimant under a Settlement Agreement of the
rights to Scheduled Payments (or any portion thereof) that have been or
which are hereafter transferred by such Claimant to the Seller pursuant to
a Settlement Purchase Agreement in contravention of an anti-assignment
provision in such Settlement Agreement that prohibits the Claimant's
transfer of the rights to such Scheduled Payments (or any such thereof).
Any Indemnified Amounts payable under this Section 7.01 shall, be paid by the
Seller to the Purchaser within five (5) Business Days following the Purchaser's
written demand therefor, setting forth in reasonable detail the basis for such
demand. The agreements of the Seller contained in this Section 7.01 shall
survive the Collection Date. In addition, in no event shall Indemnified Losses
include any consequential, special or punitive damages. The provisions of this
Section 7.01 shall survive the termination of this Agreement.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Waivers; Amendments. No failure or delay on the part of
the Purchaser or the Seller (or any assignee thereof) in exercising any power,
right or remedy under this Agreement shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power, right or remedy preclude
any other further exercise thereof or the exercise of any
-27-
other power, right or remedy. The rights and remedies herein provided shall be
cumulative and nonexclusive of any rights or remedies provided by law. Any
provision of this Agreement may be amended if, but only if, (a) such amendment
is in writing and is consented to by the Seller, the Purchaser and the Trustee
and (b) the Trustee shall have received from each Rating Agency confirmation
that such amendment will not result in the downgrading or withdrawal of the then
current ratings of any Series
SECTION 8.02. Notices. Except as provided below, all communications and
notices provided for hereunder shall be in writing and shall be given to the
other party at its address set forth below its name on the signature pages
hereto or at such other address as such party may hereafter specify for the
purposes of notice to such party. Each such notice or other communication shall
be effective (i) if given by mail, three (3) Business Days following such
posting, postage prepaid, U.S. certified or registered, (ii) if given by
overnight courier, one (1) Business Day after deposit thereof with a national
overnight courier service, or (iii) if given by any other means, when received
at the address specified on the signature pages hereof.
SECTION 8.03. Effectiveness; Binding Effect; Assignability. (a) This
Agreement shall become effective on the Closing Date and shall, from and after
such date, be binding upon and inure to the benefit of the Seller and the
Purchaser and their respective successors and permitted assigns. The Seller may
not assign any of its rights or delegate any of its duties hereunder without the
prior written consent of the Purchaser and the Trustee. No provision of this
Agreement shall in any manner restrict the ability of the Purchaser (or the
Trustee or any Certificateholder as assignees of the Purchaser) to assign,
participate, grant security interests in, or otherwise transfer any of their
rights or remedies hereunder.
(b) Without limiting the foregoing, the Seller hereby acknowledges
that, contemporaneously herewith, the Purchaser is selling, assigning,
transferring and conveying to the Trustee, for its benefit and for the benefit
of the "Certificateholders" (as defined in the Pooling and Servicing Agreement),
and the foregoing's assignees, under the Pooling and Servicing Agreement, all of
the Purchaser's right and title to and interest in, among other things, the
Purchased Assets and this Agreement to the extent relating to any "Trust Assets"
(as defined in the Pooling and Servicing Agreement), including all of the
Purchaser's rights, remedies, powers and privileges, and all claims of the
Purchaser against the Seller, under or with respect to this Agreement (whether
arising pursuant to the terms of this Agreement or otherwise available at law or
in equity), including (i) the right of the Purchaser and the obligations of the
Seller hereunder and (ii) the right, at any time, to give or withhold consents,
requests, notices, directions, approvals, demands, extensions or waivers under
or with respect to this Agreement or the obligations in respect of the Seller
hereunder to the same extent as the Purchaser may do. The Seller hereby consents
to such sale, transfer, assignment and conveyance to the Trustee and
acknowledges and agrees that the Trustee, as the assignee of the Purchaser for
the benefit of the Certificateholders and each of its assignees, shall be a
third party beneficiary of the rights of the Purchaser arising hereunder.
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(c) The Seller hereby agrees to execute all agreements, instruments and
documents, and to take all other action, that the Purchaser or the Trustee
reasonably determines is necessary or appropriate to evidence the assignments
described in clause (b) immediately above. To the extent that the Purchaser has
granted or grants powers of attorney to the Trustee under the Pooling and
Servicing Agreement, the Seller hereby grants a corresponding power of attorney
on the same terms to the Purchaser. The Seller hereby acknowledges and agrees
that the Purchaser, in all of its capacities, shall assign to the Trustee for
the benefit of the Certificateholders, and each of its assignees, such powers of
attorney and other rights and interests granted by the Seller to the Purchaser
hereunder and agrees to cooperate fully with the Trustee in the exercise of such
rights.
(d) This Agreement shall create and constitute the continuing
obligations of the parties hereto in accordance with its terms, and shall remain
in full force and effect until the Collection Date; provided, however, that (i)
the indemnification and payment provisions of Article VII and Section 8.05 and
(ii) the provisions of Sections 8.08 and 8.10, shall, in each case, be
continuing and shall survive any termination of this Agreement.
SECTION 8.04. GOVERNING LAW; WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF DELAWARE.
(b) EACH OF THE SELLER AND THE PURCHASER HEREBY WAIVES ANY RIGHT TO
HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT,
TORT OR OTHERWISE BETWEEN EITHER THEM ARISING OUT OF, CONNECTED WITH, RELATING
TO OR INCIDENTAL TO THE RELATIONSHIP BETWEEN THEM IN CONNECTION WITH THIS
AGREEMENT OR THE OTHER OPERATIVE DOCUMENTS.
SECTION 8.05. Costs and Expenses. In addition to the rights of
indemnification under Article VII hereof, the Seller agrees to pay the Purchaser
(and its agents' and assignees') within 30 days after demand all reasonable
out-of-pocket costs and expenses (including without limitation, reasonable
counsel fees and expenses) in connection with the enforcement of the covenants,
agreements, liabilities and obligations of the Seller under this Agreement.
SECTION 8.06. Execution in Counterparts; Severability. This Agreement
may be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
agreement. In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
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SECTION 8.07. Purchase Termination. (a) The agreements of the Seller to
sell Receivables hereunder may be terminated at any time by the Seller by giving
written notice thereof to the Purchaser and the Trustee of the Seller' election
to terminate this Agreement, in which event the Purchase Termination Date shall
thereafter occur on the date specified therefor by the Seller in such notice,
but in any event not less than 60 days after the Trustee's receipt of such
notice.
(b) Notwithstanding any such termination described under paragraph (a)
above, all other provisions of this Agreement shall remain in full force and
effect as provided in Section 8.03.
SECTION 8.08. No Proceedings. The Seller hereby agrees that it will not
institute against the Purchaser, or join any other Person in instituting against
the Purchaser, any proceeding of the type referred to in the definition of
"Insolvency Event" in the Pooling and Servicing Agreement, so long as there
shall not have elapsed one year plus one day since the last day on which any
amounts owing under the Certificates of the last outstanding Series shall have
been indefeasibly paid in full in cash. The foregoing shall limit the rights of
the Seller under any and all agreements it may have with the Purchaser but shall
not limit the right of the Seller to file any claim in or otherwise take any
action with respect to any insolvency proceeding that was instituted against the
Purchaser by any Person other than the Seller or any Affiliate thereof. The
provisions of this Section 8.08 shall survive the termination of this Agreement.
SECTION 8.09. Entire Agreement. This Agreement, together with the other
Operative Documents, including the exhibits and schedules hereto and thereto,
contains a final and complete integration of all prior expressions by the
parties hereto with respect to the subject matter hereof and shall constitute
the entire agreement among the parties hereto with respect to the subject matter
hereof, superseding all previous oral statements and other writings with respect
thereto.
SECTION 8.10. Limitations on Liability. None of the members, managers,
partners, officers, employees, agents, shareholders, directors or holders of
limited liability company interests of or in (x) the Purchaser or the Seller or
(y) the general or limited partners of the Seller, past, present or future,
shall be under any liability to the Seller or the Purchaser, respectively, any
of their successors or assigns, or any other Person for any action taken or for
refraining from the taking of any action in such capacities or otherwise
pursuant to this Agreement or for any obligation or covenant under this
Agreement, it being understood that this Agreement and the obligations created
hereunder shall be, to the fullest extent permitted under applicable law, with
respect to the Seller, solely the limited partnership obligation of the Seller
and with respect to the Purchaser, solely the limited liability company
obligation of the Purchaser. The Seller, the Purchaser and any member, manager,
partner, officer, employee, agent, shareholder, director or holder of a limited
liability company interest of or in (x) the Seller or the Purchaser and (y) any
general or limited partner of the Seller, may rely in good faith on any
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document of any kind prima facie properly executed and submitted by any Person
(other than the Seller or any Affiliate thereof) respecting any matters arising
hereunder.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
X. X. XXXXXXXXX S.S.C. LIMITED
PARTNERSHIP
By: X.X. Xxxxxxxxx Structured Settlement
Funding Corporation, its General Partner
By: _________________________
Name:
Title:
The Xxxxxx Building
00xx xxx Xxxxxxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000
Attention:____________________
Telecopy No.: (000) 000-0000
X. X. XXXXXXXXX RECEIVABLES I LLC
By: X.X. Xxxxxxxxx S.S.C. Limited Partnership,
a member
By: X.X. Xxxxxxxxx Structured Settlement
Funding Corporation, its General Partner
By: _________________________
Name:
Title:
000 Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxx, XX 00000
Attention:____________________
Telecopy No.: (000) 000-0000