Exhibit 4(e)
LOAN PURCHASE AND SALE AGREEMENT
Dated as of September 25, 2003,
between
CEF EQUIPMENT HOLDING, L.L.C.,
as Seller
and
GE COMMERCIAL EQUIPMENT
FINANCING LLC, SERIES 2003-1
as Purchaser
Loan Purchase
and Sale Agreement
This LOAN PURCHASE AND SALE AGREEMENT ("Agreement" or "Purchase and
Sale Agreement") is entered into as of September 25, 2003, by and among CEF
EQUIPMENT HOLDING, L.L.C. (the "Seller"), a Delaware limited liability company
and GE COMMERCIAL EQUIPMENT FINANCING LLC, SERIES 2003-1, a Delaware limited
liability company (the "Purchaser").
In consideration of the premises and the mutual covenants hereinafter
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed to them in Section 1 of Annex
A.
Section 1.2 Rules of Construction. For purposes of this
Agreement, the rules of construction set forth in Section 2 of Annex A shall
govern. All Annexes, Exhibits and Schedules hereto, are incorporated herein by
reference and, taken together with this Agreement, shall constitute but a single
agreement.
ARTICLE II
SALES OF PURCHASER ASSETS
Section 2.1 Sale of Loans. (a) Subject to the terms and
conditions hereof the Seller does hereby sell, transfer, assign, set over and
otherwise convey to the Purchaser, without recourse (subject to the obligations
herein) all right, title and interest of the Seller in:
(i) the Loans, including the Loan Files, and all
obligations of the Obligors thereunder, including the
right to payment of any interest or finance charges
and other obligations of such Obligor with respect
thereto due or to become due on or after the Cutoff
Date;
(ii) all Related Security and Collections with respect
thereto;
(iii) the Sale Agreement;
(iv) the rights of the Seller to receive capital
contributions with respect to the CEF Variable
Funding Certificate;
(v) all other property now or hereafter in the possession
or custody of, or in transit to, the Servicer, any
Sub-Servicer or the Seller relating to any of the
foregoing;
(vi) all Records with respect to any of the foregoing; and
Loan Purchase
and Sale Agreement
(vii) all Proceeds of the foregoing (collectively the
"Purchaser Assets").
(b) On or before the Closing Date, the Seller shall (i)
indicate in its computer files that the Purchaser Assets have been sold
to the Purchaser pursuant to this Agreement by so identifying the
Purchaser Assets with an appropriate notation and (ii) deliver to the
Purchaser or its designee the following documents (collectively, the
"Loan Files"):
(i) the original fully executed copy of the Loan;
(ii) a record or facsimile of the original credit
application fully executed by the Obligor;
(iii) the original certificate of title or file stamped
copy of the UCC financing statement or such other
documents evidencing the security interest of the
Purchaser in the Equipment; and
(iv) any and all other documents relating to a Loan, an
Obligor or any of the Equipment.
Section 2.2 Grant of Security Interest. The parties hereto intend
that the sale pursuant to Section 2.1 hereof shall constitute a purchase and
sale and not a loan. Notwithstanding anything to the contrary set forth in this
Section 2.2, if a court of competent jurisdiction determines that the sale
provided for herein constitutes a loan and not a purchase and sale, then the
parties hereto intend that this Agreement shall constitute a security agreement
under applicable law and that the Seller shall be deemed to have granted, and
the Seller hereby grants, to the Purchaser a first priority lien and security
interest in and to all of the Seller's right, title and interest in, to and
under the Purchaser Assets. The possession by the Purchaser of notes and such
other goods, money, documents, chattel paper or certificated securities shall be
deemed to be "possession by the secured party" for purposes of perfecting the
security interest pursuant to the Uniform Commercial Code in force in the
relevant jurisdiction (including, without limitation, Section 9-313(c)(1)
thereof). Notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, bailees or
agents (as applicable) of the Purchaser for the purpose of perfecting such
security interest under applicable law (except that nothing in this sentence
shall cause any Person to be deemed to be an agent of the Purchaser for any
purpose other than for perfection of such security interest unless, and then
only to the extent, expressly appointed and authorized by the Purchaser in
writing).
Section 2.3 Sale Price. On the Closing Date, the Purchaser shall,
upon satisfaction of the applicable conditions set forth in Article III, issue
and exchange the Notes (the "Purchaser Purchase Price") as consideration for the
Purchaser Assets sold and transferred by the Seller to the Purchaser pursuant to
Section 2.1 hereof.
Section 2.4 Removal of Loans. (a) In the event a Loan becomes a
Delinquent Loan or the Obligor thereon is subject to a bankruptcy proceeding,
the Seller shall be granted an assignable option (a "Purchase Option") to
purchase such Delinquent Loan from the Purchaser at a price (the "Option Price")
equal to the Purchase Amount. The Seller may sell, transfer, assign or otherwise
convey its Purchase Option with respect to any such Loan to any party at any
time
Loan Purchase and Sale Agreement
2
after the related Loan becomes a Delinquent Loan or the Obligor thereon is
subject to a bankruptcy proceeding. The Seller shall notify the Purchaser of
such transfer and such notice shall include the transferee's name, address,
telephone number, facsimile number and appropriate contact person(s) and shall
be acknowledged in writing by the transferee. If not exercised earlier, the
Purchase Option with respect to any such Loan shall automatically terminate upon
(i) in the case of a Delinquent Loan, the related Obligor's cure of all defaults
on the Loan, (ii) the acquisition by, or on behalf of, the Issuer of the related
equipment through repossession, (iii) upon a repurchase of a Loan due to the
Seller's breach of a representation with respect to such Loan or (iv) on the
Business Day immediately preceding the last day of the calendar quarter ending
at least ten (10) days after such Loan became a Defaulted Loan. The aggregate
Outstanding Principal Balance of Loans with respect to which the Seller may
exercise its Purchase Option at any time before the Redemption Date shall not
exceed 10% of the aggregate Outstanding Principal Balance of the Loans as of the
Cutoff Date.
(b) Upon a Loan becoming a Delinquent Loan or the Obligor
thereon is subject to a bankruptcy proceeding, the Seller may exercise
the Purchase Option by providing the Purchaser at least five days prior
written notice thereof (the "Purchase Option Notice"), which notice
shall specify a cash exercise price at least equal to the Option Price.
The Purchase Option Notice shall be delivered in the manner specified
in Section 2.4(b). The exercise of any Purchase Option pursuant to this
clause (b) shall be irrevocable.
(c) Upon exercise of a Purchase Option, the Seller shall
be required to pay the purchase price specified in its Purchase Option
Notice to the Purchaser within 10 Business Days of exercising its
Purchase Option. The proceeds of any sale of such Loan, after deduction
of the expenses of such sale incurred in connection therewith, shall be
deposited by the Seller no later than the day before the next Payment
Date.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 Conditions to Sale. The sale hereunder shall be
subject to satisfaction of each of the following conditions precedent (any one
or more of which, except clause (e) below, may be waived in writing by the
Purchaser) as of the Closing Date:
(a) This Agreement or counterparts hereof shall have been
duly executed by, and delivered to, the Seller and the Purchaser, and
the Purchaser shall have received such documents, instruments,
agreements and legal opinions as the Purchaser shall reasonably request
in connection with the transactions contemplated by this Agreement,
each in form and substance reasonably satisfactory to the Purchaser.
(b) The Purchaser shall have received satisfactory
evidence that the Seller has obtained all required consents and
approvals of all Persons, including all requisite Governmental
Authorities, to the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby.
Loan Purchase and Sale Agreement
3
(c) The Seller shall be in compliance in all material
respects with all applicable foreign, federal, state and local laws and
regulations, including those specifically referenced in Section 4.2(c),
except to the extent that the failure to so comply, individually or in
the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
(d) The representations and warranties of the Seller
contained herein or in any other Related Document shall be true and
correct in all material respects (or, to the extent any such
representation or warranty is qualified by a materiality standard, such
representation or warranty shall be true and correct) as of the Closing
Date, both before and after giving effect to such sale, except to the
extent that any such representation or warranty expressly relates to an
earlier date and except for changes therein expressly permitted by this
Agreement.
(e) The Seller shall be in compliance with each of its
covenants and other agreements set forth herein.
(f) The Seller shall have taken such other action,
including delivery of approvals, consents, opinions, documents and
instruments to the Purchaser as the Purchaser may reasonably request.
The consummation by the Seller of the sale of Purchaser Assets on the Closing
Date shall be deemed to constitute, as of the Closing Date, a representation and
warranty by the Seller that the conditions in clauses (d), (e) and (f) of this
Section 3.1 have been satisfied.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1 Representations and Warranties of the Seller. To
induce the Purchaser to purchase the Purchaser Assets, the Seller makes the
following representations and warranties to the Purchaser, as of the Closing
Date, each and all of which shall survive the execution and delivery of this
Agreement.
(a) Valid Existence; Power and Authority. The Seller (i)
is a limited liability company duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization; and
(ii) has all requisite power and authority to conduct its business, to
own its properties and to execute, deliver and perform its obligations
under this Agreement.
(b) UCC Information. The true legal name of the Seller as
registered in the jurisdiction of its organization, and the current
location of the Seller's jurisdiction of organization are set forth in
Schedule 4.1(b) and such location has not changed within the past 12
months. During the prior five years, except as set forth in Schedule
4.1(b), the Seller has not been known as or used any limited liability
company, fictitious or trade name. In addition, Schedule 4.1(b) lists
the Seller's (i) federal employer identification number and (ii)
organizational identification number as designated by the jurisdiction
of its organization.
Loan Purchase and Sale Agreement
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(c) Power, Authorization, Enforceable Obligations. The
execution, delivery and performance by the Seller of this Agreement and
the other Related Documents and the creation and perfection of all
Liens and ownership interests provided for herein: (i) have been duly
authorized by all necessary action, and (ii) do not violate any
provision of any law or regulation of any Governmental Authority, or
contractual or other restrictions, binding on the Seller, except where
such violations, individually or in the aggregate, could not reasonably
be expected to have a Material Adverse Effect.
(d) Enforceability. On or prior to the Closing Date, each
of the Related Documents to which the Seller is a party shall have been
duly executed and delivered by the Seller and each such Related
Document shall then constitute a legal, valid and binding obligation of
the Seller enforceable against it in accordance with its terms, subject
as to enforcement to bankruptcy, receivership, conservatorship,
insolvency, reorganization, moratorium and other similar laws of
general applicability relating to or affecting creditors' rights and to
general principles of equity.
(e) Solvency. The Seller is Solvent.
(f) Use of Proceeds. No proceeds received by the Seller
under this Agreement will be used by it for any purpose that violates
Regulation U of the Federal Reserve Board.
(g) Investment Company Act. The Seller is not an
"investment company" or "controlled by" an "investment company," as
such terms are defined in the Investment Company Act.
(h) Loans and Other Purchaser Assets. With respect to
each Loan and the other Purchaser Assets sold by the Seller on the
Closing Date, the Seller represents and warrants that (i) such Loan
satisfies the criteria for an Eligible Loan as of the Cut-Off Date; and
(ii) immediately prior to its sale to the Purchaser, such Purchaser
Assets were owned by the Seller free and clear of any Adverse Claim,
and the Seller has had at all relevant times the full right, power and
authority to sell, contribute, assign, transfer and pledge its interest
therein as contemplated under this Agreement and, upon such sale, the
Purchaser will acquire valid and properly perfected title to, and the
sole record and beneficial ownership interest in, such Purchaser
Assets, free and clear of any Adverse Claim or restrictions on
transferability, and the Liens granted to the Purchaser by the Seller
pursuant to Section 2.2 will at all times be fully perfected first
priority Liens in and to such ----------- Loans and, in addition,
following such sale, such Loan will not be subject to any Adverse Claim
as a result of any action or inaction on the part of the Seller (or any
predecessor in interest).
The representations and warranties described in this Section 4.1 shall survive
the sale of the Purchaser Assets to the Purchaser, any subsequent assignment or
sale of the Purchaser Assets by the Purchaser, and the termination of this
Agreement and the other Related Documents and shall continue until the payment
in full of all Purchaser Assets.
Loan Purchase and Sale Agreement
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Section 4.2 Affirmative Covenants of the Seller. The Seller
covenants and agrees that, unless otherwise consented to by the Purchaser, from
and after the Closing Date:
(a) Records. The Seller shall at its own cost and
expense, for not less than three years from the date on which each Loan
was originated, or for such longer period as may be required by law,
maintain adequate Records with respect to such Loan, including records
of all payments received, credits granted and merchandise returned with
respect thereto.
(b) Access. At any reasonable time, and from time to time
at the Purchaser's reasonable request, and upon at least seven days
prior notice to the Seller, the Seller shall permit the Purchaser (or
such Person as the Purchaser may designate), at the expense of the
Purchaser (or such Person as the Purchaser may designate), to conduct
audits or visit and inspect any of the properties of the Seller to
examine the records, internal controls and procedures maintained by the
Seller with respect to the Purchaser Assets and take copies and
extracts therefrom, and to discuss the Seller's affairs with its
officers, employees and, upon notice to the Seller, independent
accountants. The Seller shall authorize such officers, employees and
independent accountants to discuss with the Purchaser (or such Person
as the Purchaser may designate) the affairs of the Seller as such
affairs relate to the Purchaser Assets. Any audit provided for herein
shall be conducted in accordance with the Seller's rules respecting
safety and security on its premises and without materially disrupting
operations. If an Event of Default shall have occurred and be
continuing, the Seller shall provide such access at all times and
without advance notice and shall provide the Purchaser (or such Person
as the Purchaser may designate) with access to its suppliers and
customers.
(c) Compliance With Agreements and Applicable Laws. The
Seller shall comply with all federal, state and local laws and
regulations applicable to it and the Purchaser Assets, including those
relating to truth in lending, fair credit billing, fair credit
reporting, equal credit opportunity, fair debt collection practices,
privacy, licensing and taxation, except to the extent that the failure
to so comply, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
(d) Maintenance of Existence and Conduct of Business. The
Seller shall preserve and maintain its legal existence, rights,
franchise and privileges in the jurisdiction of its formation.
(e) Notice of Material Event. The Seller shall promptly
inform the Purchaser in writing of the occurrence of any of the
following, in each case setting forth the details thereof and what
action, if any, the Seller proposes to take with respect thereto:
(i) any Litigation commenced or, to the knowledge of the
Seller, threatened against the Seller or with respect
to or in connection with all or any substantial
portion of the Purchaser Assets or developments in
such Litigation in each case that the Seller believes
has a reasonable risk of being determined adversely
to the Seller and that could, if determined
adversely, have a Material Adverse Effect; or
Loan Purchase and Sale Agreement
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(ii) the commencement of a case or proceeding by or
against the Seller seeking a decree or order in
respect of the Seller (A) under the Bankruptcy Code
or any other applicable federal, state or foreign
bankruptcy or other similar law, (B) appointing a
custodian, receiver, liquidator, assignee, trustee or
sequestrator (or similar official) for the Seller or
for any substantial part of Seller's assets, or (C)
ordering the winding-up or liquidation of the affairs
of the Seller.
(f) Separate Identity. The Seller shall, to the extent
applicable to it, act in a manner that is consistent with the
statements set forth in Exhibit 4.2(f).
(g) Deposit of Collections. The Seller shall transfer and
cause its Subsidiaries to transfer to the Purchaser or the Servicer on
its behalf, promptly, and in any event no later than the second
Business Day after receipt thereof, all Collections it may receive in
respect of Purchaser Assets.
(h) Sale Characterization. For accounting purposes, the
Seller shall treat the sale made hereunder as a sale of the Purchaser
Assets. The Seller shall also maintain its accounting books and records
in a manner which clearly reflects such sale of the Purchaser Assets to
the Purchaser.
(i) Variable Funding Certificate Contributions. Upon a
demand by the Purchaser for a capital contribution from the Seller
under the Purchaser Variable Funding Certificate, the Seller shall
demand contributions from the CEF Variable Funding Certificateholder
under the CEF Variable Funding Certificate in the amounts and at the
times sufficient to permit the Seller to meet its funding obligations
under the Purchaser Variable Funding Certificate.
Section 4.3 Negative Covenants of the Seller. The Seller
covenants and agrees that, without the prior written consent of the Purchaser,
from and after the Closing Date and until the later of the Redemption Date or
the Maturity Date:
(a) Adverse Claims. The Seller shall not create, incur,
assume or permit to exist any Adverse Claim on or with respect to any
Purchaser Assets.
(b) Modifications of Loans. The Seller shall not extend,
amend, forgive, discharge, compromise, cancel, waive or otherwise
modify the terms or conditions of any Loan except (i) as permitted
under the Servicing Agreement and, (ii) to the extent that such
extension, amendment, forgiveness, discharge, compromise, cancellation,
waiver or modification, does not affect the Purchaser's ownership
interest in such Loan and does not negatively impact the ultimate
collectibility of such Loan.
(c) UCC Matters. The Seller shall not change its state of
formation or its name, identity or limited liability company structure
such that any financing statement filed to perfect the Purchaser's
interests under this Agreement would become seriously misleading,
unless the Seller shall have given the Purchaser not less than 30 days'
prior written notice of such change.
Loan Purchase and Sale Agreement
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(d) No Proceedings. From the Closing Date and until the
date one year plus one day following the date on which all amounts due
with respect to the Notes have been paid in full in cash, Seller shall
not, directly or indirectly, institute or cause to be instituted
against the Purchaser any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding or other proceeding under any
federal or state bankruptcy or similar law; provided that the foregoing
shall not in any way limit the Seller's right to pursue any other
creditor rights or remedies that the Seller may have under applicable
law.
(e) Consolidations, Mergers and Sales of Assets. The
Seller shall not (i) consolidate or merge with or into any other Person
unless the Seller is the entity surviving such merger or (ii) sell,
lease or otherwise transfer all or substantially all of its assets to
any other Person.
(f) Variable Funding Certificate Contributions. The
Seller shall not demand a capital contribution from the CEF Variable
Funding Certificateholder except to the extent that there shall have
been a demand made by the Purchaser for a capital contribution under
the Purchaser Variable Funding Certificate. In addition, the Seller
shall not reduce the Variable Funding Capital Commitment under the
Purchaser Variable Funding Certificate.
ARTICLE V
INDEMNIFICATION
Section 5.1 Indemnification. Without limiting any other rights
that the Purchaser or any of its Stockholders, officers, directors, employees,
attorneys, agents or representatives (each, a "Purchaser Indemnified Person")
may have hereunder or under applicable law, the Seller hereby agrees to,
indemnify and hold harmless each Purchaser Indemnified Person from and against
any and all Indemnified Amounts that may be claimed or asserted against or
incurred by any such Purchaser Indemnified Person to the extent arising from or
related to the failure of a Loan to be originated in compliance with all
requirements of law; provided, that the Seller shall not be liable for any
indemnification to a Purchaser Indemnified Person to the extent that any such
Indemnified Amounts result from (a) such Purchaser Indemnified Person's bad
faith, gross negligence or willful misconduct, (b) recourse for uncollectible
Loans, or (c) any income tax or franchise tax incurred by any Purchaser
Indemnified Person, except to the extent that the incurrence of any such tax
results from a breach of or default by the Seller under this Agreement.
NO PARTY TO THIS AGREEMENT SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO
THIS AGREEMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH
PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR
INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES THAT MAY BE ALLEGED AS A
RESULT OF ANY TRANSACTION CONTEMPLATED HEREUNDER.
Loan Purchase and Sale Agreement
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ARTICLE VI
CLEAN-UP CALL
Section 6.1 Clean-up Call. As of the first day of any Collection
Period immediately preceding a Payment Date as of which the Pool Balance is 10%
or less of the Pool Balance as of the Cut-off Date, the Seller shall have the
option to purchase all of the Collateral, other than the Trust Accounts. To
exercise such option, the Seller shall pay to the Servicer, on behalf of the
Issuer, and the Servicer shall deposit in the Collection Account an amount equal
to the aggregate Purchase Amount for the Loans plus the appraised value of any
such other property held by the Purchaser, such value to be determined by an
appraiser mutually agreed upon by the Seller and the Purchaser, shall succeed to
all interests in, to and under the Collateral, other than the Trust Accounts.
ARTICLE VII
MISCELLANEOUS
Section 7.1 Notices. Except as otherwise provided herein,
whenever it is provided herein that any notice, demand, request, consent,
approval, declaration or other communication shall or may be given to or served
upon any of the parties by any other parties, or whenever any of the parties
desires to give or serve upon any other parties any communication with respect
to this Agreement, each such notice, demand, request, consent, approval,
declaration or other communication shall be in writing and shall be deemed to
have been validly served, given or delivered (a) upon the earlier of actual
receipt and three Business Days after deposit in the United States mail,
registered or certified mail, return receipt requested, with proper postage
prepaid, (b) upon transmission, when sent by telecopy or other similar facsimile
transmission (with such telecopy or facsimile promptly confirmed by delivery of
a copy by personal delivery or United States mail as otherwise provided in this
Section 7.1), (c) one Business Day after deposit with a reputable overnight
courier with all charges prepaid or (d) when delivered, if hand-delivered by
messenger, all of which shall be addressed to the party to be notified and sent
to the address or facsimile number set forth below or to such other address (or
facsimile number) as may be substituted by notice given as herein provided. The
giving of any notice required hereunder may be waived in writing by the party
entitled to receive such notice. Failure or delay in delivering copies of any
notice, demand, request, consent, approval, declaration or other communication
to any Person (other than Purchaser) designated in any written communication
provided hereunder to receive copies shall in no way adversely affect the
effectiveness of such notice, demand, request, consent, approval, declaration or
other communication. Notwithstanding the foregoing, whenever it is provided
herein that a notice is to be given to any other party hereto by a specific
time, such notice shall be effective only if actually received by such party
prior to such time, and if such notice is received after such time or on a day
other than a Business Day, such notice shall be effective only on the
immediately succeeding Business Day.
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If to Seller:
CEF Equipment Holding, L.L.C.
00 Xxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Purchaser:
GE Commercial Equipment Financing LLC,
Series 2003-1
00 Xxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Capital Markets Operations
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Section 7.2 No Waiver; Remedies. (a) Either party's failure, at
any time or times, to require strict performance by the other party hereto of
any provision of this Agreement shall not waive, affect or diminish any right of
such party thereafter to demand strict compliance and performance herewith. Any
suspension or waiver of any breach or default hereunder shall not suspend, waive
or affect any other breach or default whether the same is prior or subsequent
thereto and whether of the same or a different type. None of the undertakings,
agreements, warranties, covenants and representations of either party contained
in this Agreement, and no breach or default by either party hereunder, shall be
deemed to have been suspended or waived by the other party hereto unless such
waiver or suspension is by an instrument in writing signed by an officer of or
other duly authorized signatory of such party and directed to the defaulting
party specifying such suspension or waiver.
(b) Upon discovery by the Seller or the Purchaser of any
breach of any representation, warranty, undertaking or covenant
described in Sections 4.1, 4.2 or 4.3, which breach is reasonably
likely to have a Material Adverse Effect, the party discovering the
same shall give prompt written notice thereof to the other party
hereto. As liquidated damages, the Purchaser shall, on the Transfer
Date relating to the Collection Period during which the breach is
discovered, request the Seller to, and the Seller shall pay to, or at
the direction of, the Purchaser the Purchase Amount for the applicable
Purchaser Assets (measured at the end of the Collection Period during
which such breach is discovered). Upon such payment, all rights, title
and interest of the Purchaser in and to such Purchaser Assets will be
deemed to be automatically released without the necessity of any
further action by the Purchaser, the Seller or any other party and such
Purchaser Assets will become the property of the Seller.
(c) Each party's rights and remedies under this Agreement
shall be cumulative and nonexclusive of any other rights and remedies
that such party may have
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under any other agreement, including the other Related Documents, by
operation of law or otherwise.
Section 7.3 Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the Seller and the Purchaser and
their respective successors and permitted assigns, except as otherwise provided
herein. The Seller may not assign, transfer, hypothecate or otherwise convey its
rights, benefits, obligations or duties hereunder without the prior express
written consent of the Purchaser. Any such purported assignment, transfer,
hypothecation or other conveyance by the Seller without the prior express
written consent of the Purchaser shall be void. The Seller acknowledges that
under the Indenture the Purchaser will assign its rights granted hereunder to
the Indenture Trustee, and upon such assignment, Indenture Trustee shall have,
to the extent of such assignment, all rights of the Purchaser hereunder and
Indenture Trustee may in turn transfer such rights. The terms and provisions of
this Agreement are for the purpose of defining the relative rights and
obligations of the Seller and the Purchaser with respect to the transactions
contemplated hereby and no Person shall be a third-party beneficiary of any of
the terms and provisions of this Agreement.
Section 7.4 Termination; Survival of Obligations. (a) 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 earlier of (i) the Maturity Date or (ii) the Redemption Date.
(b) Except as otherwise expressly provided herein or in
any other Related Document, no termination or cancellation (regardless
of cause or procedure) of any commitment made by the Purchaser under
this Agreement shall in any way affect or impair the obligations,
duties and liabilities of the Seller or the rights of the Purchaser
relating to any unpaid portion of any and all recourse and indemnity
obligations of the Seller to the Purchaser, due or not due, liquidated,
contingent or unliquidated or any transaction or event occurring prior
to such termination, or any transaction or event, the performance of
which is required after the Maturity Date. Except as otherwise
expressly provided herein or in any other Related Document, all
undertakings, agreements, covenants, warranties and representations of
or binding upon the Seller, and all rights of the Purchaser hereunder
shall not terminate or expire, but rather shall survive any such
termination or cancellation and shall continue in full force and effect
until the earlier of (i) the Maturity Date or (ii) the Redemption Date;
provided, that the rights and remedies pursuant to Section 7.2(b), the
indemnification and payment provisions of Article V, and the provisions
of Sections 4.3(e), 7.3 and 7.12 shall be continuing and shall survive
any termination of this Agreement.
Section 7.5 Complete Agreement; Modification of Agreement. This
Agreement constitutes the complete agreement between the parties with respect to
the subject matter hereof, supersedes all prior agreements and understandings
relating to the subject matter hereof and thereof, and may not be modified,
altered or amended except as set forth in Section 7.6.
Section 7.6 Amendments and Waivers. No amendment, modification,
termination or waiver of any provision of this Agreement, or any consent to any
departure therefrom by any party hereto, shall in any event be effective unless
the same shall be in writing and signed by
Loan Purchase and Sale Agreement
11
each of the parties hereto. No consent or demand in any case shall, in itself,
entitle any party to any other consent or further notice or demand in similar or
other circumstances.
Section 7.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL IN
ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS
OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS
THEREOF EXCEPT SECTION 5-1401 OF THE GENERAL OBLIGATION LAW) AND ANY APPLICABLE
LAWS OF THE UNITED STATES OF AMERICA.
(b) EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE
STATE OR FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK
CITY SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS
OR DISPUTES BETWEEN THEM PERTAINING TO THIS AGREEMENT OR TO ANY MATTER
ARISING OUT OF OR RELATING TO THIS AGREEMENT; PROVIDED, THAT EACH PARTY
HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE
HEARD BY A COURT LOCATED OUTSIDE OF THE BOROUGH OF MANHATTAN IN NEW
YORK CITY; PROVIDED FURTHER, THAT NOTHING IN THIS AGREEMENT SHALL BE
DEEMED OR OPERATE TO PRECLUDE THE PURCHASER FROM BRINGING SUIT OR
TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE
LOANS OR ANY SECURITY FOR THE OBLIGATIONS OF THE SELLER ARISING
HEREUNDER OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE
PURCHASER. EACH PARTY HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND
EACH PARTY HERETO HEREBY WAIVES ANY OBJECTION THAT SUCH PARTY MAY HAVE
BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON
CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR
EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. EACH PARTY
HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND
OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE
OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED
OR CERTIFIED MAIL ADDRESSED TO SUCH PARTY AT ITS ADDRESS DETERMINED IN
ACCORDANCE WITH SECTION 6.1 AND THAT SERVICE SO MADE SHALL BE DEEMED
COMPLETED UPON THE EARLIER OF SUCH PARTY'S ACTUAL RECEIPT THEREOF OR
THREE DAYS AFTER DEPOSIT IN THE UNITED STATES MAIL, PROPER POSTAGE
PREPAID. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF ANY PARTY
HERETO TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
Loan Purchase and Sale Agreement
12
(c) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX
FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN
EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND
FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES
DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE
BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING
BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO
THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 7.8 Counterparts. This Agreement may be executed in any
number of separate counterparts, each of which shall collectively and separately
constitute one agreement.
Section 7.9 Severability. Wherever possible, each provision of
this Agreement shall be interpreted in such a manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
Section 7.10 Section Titles. The section titles and table of
contents contained in this Agreement are provided for ease of reference only and
shall be without substantive meaning or content of any kind whatsoever and are
not a part of the agreement between the parties hereto.
Section 7.11 No Setoff. The Seller's obligations under this
Agreement shall not be affected by any right of setoff, counterclaim,
recoupment, defense or other right the Seller might have against the Purchaser,
all of which rights are hereby expressly waived by the Seller.
Section 7.12 Confidentiality. Notwithstanding anything herein to
the contrary, there is no restriction (express or implied) on any disclosure or
dissemination of the structure or tax aspects of the transaction contemplated by
the Related Documents. Furthermore, each party hereto acknowledges that it has
no proprietary rights to any tax matter or tax idea contemplated hereby or to
any element of the transaction structure contemplated hereby.
Section 7.13 Further Assurances. (a) The Seller shall, at its sole
cost and expense, upon request of the Purchaser, promptly and duly authorize,
execute and/or deliver, as applicable, any and all further instruments and
documents and take such further actions that may be necessary or desirable or
that the Purchaser may request to carry out more effectively the provisions and
purposes of this Agreement or to obtain the full benefits of this Agreement and
of the rights and powers herein granted, including authorizing and filing any
financing or continuation statements under the UCC with respect to the ownership
interests or Liens granted hereunder. The Seller hereby authorizes the Purchaser
to file any such financing or continuation
Loan Purchase and Sale Agreement
13
statements without the signature of the Seller to the extent permitted by
applicable law. A carbon, photographic or other reproduction of this Agreement
or of any notice or financing statement covering the Purchaser Assets or any
part thereof shall be sufficient as a notice or financing statement where
permitted by law. If any amount payable under or in connection with any of the
Purchaser Assets is or shall become evidenced by any instrument, such
instrument, other than checks and notes received in the ordinary course of
business, shall be duly endorsed in a manner satisfactory to the Purchaser
immediately upon the Seller's receipt thereof and promptly delivered to or at
the direction of the Purchaser.
(b) If the Seller fails to perform any agreement or obligation
under this Section 7.13, the Purchaser may (but shall not be required to) itself
perform, or cause performance of, such agreement or obligation, and the
reasonable expenses of the Purchaser incurred in connection therewith shall be
payable by the Seller upon demand of the Purchaser.
Section 7.14 Accounting Changes. If any Accounting Changes occur
and such changes result in a change in the standards or terms used herein, then
the parties hereto agree to enter into negotiations in order to amend such
provisions so as to equitably reflect such Accounting Changes with the desired
result that the criteria for evaluating the financial condition of such Persons
and their Subsidiaries shall be the same after such Accounting Changes as if
such Accounting Changes had not been made. If the parties hereto agree upon the
required amendments to this Agreement, then after appropriate amendments have
been executed and the underlying Accounting Change with respect thereto has been
implemented, any reference to GAAP contained herein shall, only to the extent of
such Accounting Change, refer to GAAP consistently applied after giving effect
to the implementation of such Accounting Change. If such parties cannot agree
upon the required amendments within 30 days following the date of implementation
of any Accounting Change, then all financial statements delivered and all
standards and terms used herein shall be prepared, delivered and used without
regard to the underlying Accounting Change.
[Signatures Follow]
Loan Purchase and Sale Agreement
14
IN WITNESS WHEREOF, the parties have caused this LOAN PURCHASE AND
SALE AGREEMENT to be executed by their respective duly authorized
representatives, as of the date first above written.
CEF EQUIPMENT HOLDING, L.L.C.
By: _______________________________________
Name: _________________________________
Title: ________________________________
GECF EQUIPMENT FINANCING LLC,
SERIES 2003-1
By: CEF Equipment Holding, L.L.C.,
its Managing Member
By: ___________________________________
Name: _____________________________
Title: ____________________________
Loan Purchase and Sale Agreement
15
Schedule 4.1(b)
UCC INFORMATION
GE Commercial Equipment Financing LLC,
Series 2003-1
True Legal Name: GE Commercial Equipment Financing LLC,
Series 2003-1
Jurisdiction of Organization: Delaware
Executive Offices/Principal Place of 00 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx: Xxxxxxx, Xxxxxxxxxxx 00000
Collateral Locations: Danbury, Connecticut
El Paso, Texas
Mexico
India
Trade Names: N/A
FEIN: 00-0000000
Organizational Identification Number: N/A
Loan Purchase
and Sale Agreement
Schedule I
Schedule of Loans
Loan Purchase
and Sale Agreement
EXHIBIT 4.2(f)
SEPARATE IDENTITY PROVISIONS
The Purchaser, GECS, GE Capital and the Seller have and will continue
(in each case, to the extent within its control) to maintain the Purchaser's
separate existence and identity and have and will continue to take all steps
necessary to make it apparent to third parties that the Purchaser is an entity
with assets and liabilities distinct from those of the Seller, GE Capital or
GECS or any other subsidiary or affiliate of the Seller, GE Capital or GECS. In
addition to the foregoing, such steps and indicia of the Purchaser's separate
identity include the following:
(a) The Purchaser does and will maintain its own stationery and
other business forms separate from those of any other Person (including the
Seller, GE Capital and GECS), and will conduct business in its own name except
that certain Persons may act on behalf of the Purchaser as agents;
(b) The Purchaser maintains and will maintain separate office
space of its own as part of its operations, although such space is in a building
shared with GE Capital. The corporate records, the other books and records, and
the other assets of the Purchaser are and will be segregated from the property
of the Seller and GECS, respectively;
(c) GECS and/or GE Capital will issue consolidated financial
statements, which financial statements will not show Purchaser Assets that have
been sold by the Seller to the Purchaser as assets of the Seller and its
consolidated subsidiaries. The Seller, GECS, GE Capital and the Purchaser will
take certain actions to disclose publicly the Purchaser's separate existence and
the transactions contemplated hereby, including through the filing of the UCC
Financing Statements. None of the Seller, GECS, GE Capital or the Purchaser has
concealed or will conceal from any interested party any transfers contemplated
by the Related Documents;
(d) The Purchaser will not have its own employees, and, as
indicated, the Purchaser's business relating to the Purchaser Assets may be
conducted through the agents. However, any allocations of direct, indirect or
overhead expenses for items shared between the Purchaser and GE Capital or GECS
that are not included as part of the servicing fee are and will be made among
such entities to the extent practical on the basis of actual use or value of
services rendered and otherwise on a basis reasonably related to actual use or
the value of services rendered;
(e) Except as provided in paragraph (d) above regarding the
allocation of certain shared overhead items, the Purchaser does and will pay its
own operating expenses and liabilities from its own funds, except GECS did and
will pay all expenses of the Purchaser incurred in connection with the
transactions entered into pursuant to the Related Documents, including those
related to the Purchaser's organization;
(f) Each of the Seller, GECS, GE Capital and the Purchaser does
and will maintain its assets and liabilities in such a manner that it is not
costly or difficult to segregate, ascertain or otherwise identify the
Purchaser's individual assets and liabilities from those of the Seller, GE
Capital or GECS or from those of any other person or entity, including any other
subsidiary or affiliate of the Seller, GE Capital or GECS. Except as set forth
below, the Purchaser does and will maintain its own books of account and
corporate records separate from the Seller, GE
Loan Purchase
and Sale Agreement
Capital and GECS or any other subsidiary or affiliate of the Seller, GE Capital
and GECS. Monetary transactions, including those with each other, are and will
continue to be properly reflected in their respective financial records. The
Purchaser does not and will not commingle or pool its funds or other assets or
liabilities with those of the Seller, GE Capital or GECS or any other subsidiary
or affiliate of the Seller, GE Capital or GECS except as specifically provided
in the Related Documents with respect to the temporary commingling of
Collections and with respect to, if applicable, any such Person's retention, in
their capacity as agent or Custodian for the Purchaser, of the books and records
pertaining to the Purchaser Assets. However, any such agent or Custodian will
not generally make the books and records relating to the Purchaser Assets
available to any of creditors or other interested persons of the Purchaser, the
Seller, GE Capital or GECS. The Purchaser does not and will not maintain joint
bank accounts or other depository accounts to which the Seller, GE Capital or
GECS or any other subsidiary or affiliate of the Seller, GE Capital or GECS
(other than in their capacity as agent for the Purchaser, if applicable) has
independent access;
(g) The Purchaser will strictly observe corporate formalities, and
the Seller, GE Capital and GECS will strictly observe corporate formalities with
respect to its dealings with the Purchaser. Specifically, no transfer of assets
between any of the Seller, GE Capital and GECS, on the one hand, and the
Purchaser, on the other, will be made without adherence to corporate
formalities;
(h) The transactions among the Purchaser and the Seller, GE
Capital or GECS, including the terms governing any servicer advances and the
amount and payment of the servicing fee, are on terms and conditions that are
consistent with those of arm's-length relationships. None of the Seller, GE
Capital or GECS is or will be, or holds or will hold itself out to be,
responsible for the debts of the Purchaser, except as provided in: the
representations made by GE Capital (including, if applicable, as a servicer or a
sub-servicer) to the Purchaser relating to the Purchaser Assets and their prior
ownership and servicing thereof. The Purchaser will not guaranty the debts of
the Seller, GE Capital or GECS;
(i) All distributions made by the Purchaser to GECS as its sole
member shall be in accordance with applicable law;
(j) Any other transactions between the Purchaser and the Seller,
GE Capital or GECS permitted by (although not expressly provided for in) the
Related Documents have been and will be fair and equitable to each of the
parties, have been and will be the type of transaction that would be entered
into by a prudent person or entity, and have been and will be on terms that are
at least as favorable as may be obtained from a third party Person; and
(k) The Purchaser is not named, or has entered into any agreement
to be named, directly or indirectly, as a direct or contingent beneficiary or
loss payee on any insurance policy covering the assets of the Seller, GE Capital
or GECS.
* * * * * *
Loan Purchase
and Sale Agreement
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS AND INTERPRETATION............................................................ 1
Section 1.1 Definitions...................................................................... 1
Section 1.2 Rules of Construction............................................................ 1
ARTICLE II SALES OF PURCHASER ASSETS................................................................. 1
Section 2.1 Sale of Loans.................................................................... 1
Section 2.2 Grant of Security Interest....................................................... 2
Section 2.3 Sale Price....................................................................... 2
Section 2.4 Removal of Loans................................................................. 2
ARTICLE III CONDITIONS PRECEDENT...................................................................... 3
Section 3.1 Conditions to Sale............................................................... 3
ARTICLE IV REPRESENTATIONS, WARRANTIES AND COVENANTS................................................. 4
Section 4.1 Representations and Warranties of the Seller..................................... 4
Section 4.2 Affirmative Covenants of the Seller.............................................. 6
Section 4.3 Negative Covenants of the Seller................................................. 7
ARTICLE V INDEMNIFICATION........................................................................... 8
Section 5.1 Indemnification.................................................................. 8
ARTICLE VI CLEAN-UP CALL............................................................................. 9
Section 6.1 Clean-up Call.................................................................... 9
ARTICLE VII MISCELLANEOUS............................................................................. 9
Section 7.1 Notices.......................................................................... 9
Section 7.2 No Waiver; Remedies.............................................................. 10
Section 7.3 Successors and Assigns........................................................... 11
Section 7.4 Termination; Survival of Obligations............................................. 11
Section 7.5 Complete Agreement; Modification of Agreement.................................... 11
Section 7.6 Amendments and Waivers........................................................... 11
Section 7.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL..................... 12
Section 7.8 Counterparts..................................................................... 13
Section 7.9 Severability..................................................................... 13
Section 7.10 Section Titles................................................................... 13
Section 7.11 No Setoff........................................................................ 13
Section 7.12 Confidentiality.................................................................. 13
Section 7.13 Further Assurances............................................................... 13
Section 7.14 Accounting Changes............................................................... 14
Loan Purchase
and Sale Agreement
-i-
TABLE OF CONTENTS
(Continued)
PAGE
Schedule I UCC Information
Schedule 4.1(b) UCC Information
Schedule I Schedule of Loans
Exhibit 4.2(f) Separate Indemnity Provisions
Loan Purchase
and Sale Agreement
-ii-
EXECUTION COPY
ANNEX A
to
LOAN PURCHASE AND SALE AGREEMENT
dated as of
September 25, 2003
Annex A to
Loan Purchase and Sale Agreement
DEFINITIONS AND INTERPRETATION
SECTION 1. Definitions and Conventions. Capitalized terms used in the
Purchase and Sale Agreement shall have (unless otherwise provided elsewhere
therein) the following respective meanings:
"Accounting Changes" means, with respect to any Person, an adoption of
GAAP different from such principles previously used for reporting purposes by
such Person as defined in the Accounting Principles Board Opinion Number 20.
"Administration Agreement" means the Administration Agreement, dated as
of September 25, 2003, between the Administrator and the Issuer.
"Administrator" means GE Capital, in its capacity as Administrator
under the Administration Agreement, or any other Person designated as a
successor administrator.
"Adverse Claim" means any claim of ownership or any Lien, other than
any ownership interest or Lien created under the Sale Agreement or the Purchase
and Sale Agreement, any Lien created under the Indenture or any Permitted
Encumbrances.
"Affiliate" means, with respect to any Person, (a) each Person that,
directly or indirectly, owns or controls, whether beneficially, or as a trustee,
guardian or other fiduciary, five percent (5%) or more of the stock having
ordinary voting power in the election of directors of such Person, (b) each
Person that controls, is controlled by, or is under common control with such
Person, or (c) each of such Person's officers, directors, joint venturers and
partners. For the purposes of this definition, "control" of a Person means the
possession, directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the ownership of voting
securities, by contract or otherwise.
"Annual Percentage Rate" or "APR" of a Loan means, the interest rate or
annual rate of finance charges stated in or, if not explicitly stated, the
implicit finance charge used by GE Capital to calculate periodic payments with
respect to the related Loan.
"Appendices" means, with respect to any Related Document, all exhibits,
schedules, annexes and other attachments thereto, or expressly identified
thereto.
"Bankruptcy Code" means the provisions of Title 11 of the United States
Code, 11 U.S.C. Sections 101 et seq.
"Business Day" means any day that is not a Saturday, a Sunday or a day
on which banks are required or permitted to be closed in the State of New York
or the State of Connecticut.
"CEF Limited Liability Company Agreement" means the Second Amended &
Restated Limited Liability Company Agreement of the Seller dated as of September
25, 2003, as supplemented by the Series 2003-1 LLC Supplement.
Annex A to
Loan Purchase and Sale Agreement
"CEF Variable Funding Certificate" means the Variable Funding
Certificate issued by CEF Equipment Holding, L.L.C. pursuant to the Series
2003-1 LLC Supplement.
"CEF Variable Funding Certificateholder" means the registered holder of
the CEF Variable Funding Certificate.
"Closing Date" means September 25, 2003.
"Collateral" is defined in the Indenture.
"Collection Account" is the account designated as such, established and
owned by the Issuer.
"Collection Period" means, with respect to any Payment Date, the
calendar month preceding the month in which the Payment Date occurs (or, if for
the first Payment Date, the period from and including the day after the Cut-off
Date to and including the last day of the calendar month preceding the calendar
month in which the first Payment Date occurs).
"Collections" means, with respect to any Payment Date all payments made
by or on behalf of the Obligors received during the related Collection Period,
any Recoveries received during the related Collection Period, any proceeds from
insurance policies covering the Equipment or related Obligor received during the
related Collection Period. Liquidation Proceeds received during the related
Collection Period, and payments made by a lessee pursuant to its obligation (if
any) to pay the Termination Value pursuant to the related Loan received during
the related Collection Period.
"Consumer Contract" is defined in the Loan Sale Agreement.
"Credit and Collection Policies" or "Credit and Collection Policy"
means, with respect to each type of Loan, the policies, practices and procedures
of the commercial equipment financing division of General Electric Capital
Corporation, as adopted by the Issuer for providing equipment financing,
including the policies and procedures for determining the creditworthiness of
Obligors and the extension of credit to Obligors, or relating to the maintenance
of such types of loans and collections on such types of loans, as such policies
and procedures, as applicable, may be amended from time to time.
"Cut-off Date" means August 2, 2003.
"Delinquent Loan" means (i) any Loan that is more than 60 days past due
and (ii) any Loan more than 30 days past due and for which the Servicer on
behalf of the Purchaser has at any time after the Cut-off Date extended the due
date for a Scheduled Payment thereon.
"Defaulted Loan" means a Loan with respect to which (i) the Servicer on
behalf of the Purchaser has repossessed the Equipment securing such Loan and
which is not a Liquidated Loan or (ii) any portion of the Loan Value is deemed
uncollectible in accordance with the Credit and Collection Policy.
Annex A to
Loan Purchase and Sale Agreement
2
"Eligible Loan" means as to each Purchaser Asset as of the Closing
Date:
(i) Characteristics of Purchaser Assets. Each Purchaser Asset:
(A) was either originated in the United States of America by the
Originator in connection with the financing or lease of Equipment in
the ordinary course of the Originator's business or acquired by the
Originator in the ordinary course of the Originator's business, and, in
each case, was fully and properly executed by the parties thereto, (B)
has created a valid, subsisting and enforceable first priority security
interest (except to the extent the Equipment secures any loan that is
cross-collateralized with such Purchaser Asset) in the Equipment in
favor of the Originator that, as of the Closing Date, has been assigned
by the Originator to Seller, and by Seller to Purchaser and (C)
contains customary and enforceable provisions such that the rights and
remedies of the holder thereof are adequate for realization against the
collateral of the benefits of the security.
(ii) Schedule of Purchaser Assets. The information set forth
on Schedule I of the Loan Sale Agreement is true and correct in all
material respects as of the opening of business on the Cutoff Date and
no selection procedures believed by Seller to be adverse to the
interests of the Purchaser were utilized in selecting the Purchaser
Assets. The computer tape regarding the Purchaser Assets made available
to Purchaser and its assigns is true and correct in all respects.
(iii) Compliance with Law. Each Purchaser Asset and the sale
or lease of the related Equipment complied in all material respects at
the time it was originated or made and at the execution of this
Agreement with all requirements of applicable Federal, State and local
laws and regulations thereunder.
(iv) Binding Obligation. Each Puchaser Asset represents the
genuine, legal, valid and binding payment obligation in writing of the
Obligor, enforceable by the holder thereof in accordance with its
terms.
(v) No Government Obligor. None of the Purchaser Assets is due
from the United States of America or any State or from any agency,
department or instrumentality of the United States of America or any
State.
(vi) Security Interest in the Equipment. Immediately prior to
the sale, assignment and transfer thereof, each Purchaser Asset shall
be secured by a validly perfected first priority security interest in
the Equipment (except to the extent the Equipment secures any loan that
is cross-collateralized with such Purchaser Asset) in favor of the
Originator as secured party or all necessary and appropriate actions
have been commenced that would result in the valid perfection of a
first priority security interest in the Equipment in favor of the
Originator as secured party.
(vii) Purchaser Assets in Force. No Purchaser Asset has been
satisfied, subordinated or rescinded, nor has any Equipment been
released from the Lien granted by the related Purchaser Asset in whole
or in part.
(viii) No Amendment or Waiver. No provision of a Purchaser
Asset has been waived, altered or modified in any respect, except
pursuant to a document, instrument or
Annex A to
Loan Purchase and Sale Agreement
3
writing included in the Loan Files and no such amendment, waiver,
alteration or modification causes such Purchaser Asset not to be an
Eligible Loan.
(ix) No Defenses. No right of rescission, setoff, counterclaim
or defense has been asserted or threatened or exists with respect to
any Purchaser Asset.
(x) Lawful Assignment. No Purchaser Asset has been originated
in, or is subject to the laws of, any jurisdiction under which the
sale, transfer and assignment of such Purchaser Asset or any Purchaser
Asset under this Agreement would be unlawful.
(xi) All Filings Made. All filings (including UCC filings)
necessary in any jurisdiction to give Purchaser a first priority
perfected ownership interest in the Purchaser Assets have been made
(except to the extent the Equipment secures any loan that is
cross-collateralized with such Purchaser Asset).
(xii) One Original. There is only one original executed copy
of each Purchaser Asset.
(xiii) Insurance. The Obligor on each Purchaser Asset is
required to maintain physical damage insurance covering the Equipment
in accordance with the Originator's normal requirements.
(xiv) No Bankruptcies. No Obligor on any Purchaser Asset as of
the Cutoff Date was noted in the related Loan File as being the subject
of a bankruptcy proceeding.
(xv) No Repossessions. None of the Equipment securing any
Purchaser Asset is in repossession status.
(xvi) Instrument or Chattel Paper. Each Purchaser Asset
constitutes an "instrument" or "chattel paper" as defined in the UCC of
each State the law of which governs the perfection of the interest
granted in it and/or the priority of such perfected interest.
(xvii) U.S. Obligors. None of the Purchaser Assets is
denominated and payable in any currency other than United States
Dollars or is due from any Person that does not have a mailing address
in the United States of America.
(xviii) No Delinquent Loan. None of the Purchaser Assets is
more than 30 days past due.
(xix) No Consumer Contract. None of the Purchaser Assets
constitutes a Consumer Contract.
(xx) Finance Lease. Each Purchaser Asset qualifies as a
finance lease under the UCC and the terms of such Purchaser Asset
provides that, by the end of the lease term, the lessee may elect to
purchase the related Equipment upon the exercise of a nominal purchase
option.
Annex A to
Loan Purchase and Sale Agreement
4
"Equipment" means any transportation equipment, industrial equipment,
furniture and fixtures, construction equipment, technology and
telecommunications equipment, maritime assets or other equipment, together with
all accessions thereto securing an Obligor's indebtedness under the respective
Loan.
"Event of Default" is defined in Section 5.1 of the Indenture.
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the Closing Date, modified by Accounting
Changes as GAAP is further defined in Section 2(a) of this Annex A.
"GE Capital" means General Electric Capital Corporation, a Delaware
corporation or any successors or assigns thereto.
"GECS" means General Electric Capital Services, Inc., a Delaware
corporation or any successors or assigns thereto.
"Governmental Authority" means any nation or government, any state,
county, city, town, district, board, bureau, office, commission, any other
municipality or other political subdivision thereof (including any educational
facility, utility or other Person operated thereby), and any agency, department
or other entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Indemnified Amounts" means, with respect to any Person, any and all
suits, actions, proceedings, claims, damages, losses, liabilities and expenses
(including reasonable attorneys' fees and disbursements and other costs of
investigation or defense, including those incurred upon any appeal).
"Indenture" means the Indenture, dated September 25, 2003, between the
Purchaser and the Indenture Trustee, as the same may be amended and supplemented
from time to time.
"Indenture Trustee" means JPMorgan Chase Bank, not in its individual
capacity but solely as Indenture Trustee under the Indenture, or any successor
Indenture Trustee under the Indenture.
"Investment Company Act" means the provisions of the Investment Company
Act of 1940, 15 U.S.C. Sections 80a et seq., and any regulations promulgated
thereunder.
"Issuer" means GE Commercial Equipment Financing LLC, Series 2003-1, a
Delaware limited liability company, until a successor replaces it and,
thereafter, means the successor and, for purposes of any provision contained in
the Indenture and required by the Trust Indenture Act of 1939, each other
obligor on the Notes.
"Lien" means a security interest (as such term is defined in Section
1-201 of Article 1 of the UCC), lien, charge, pledge, equity or encumbrance of
any kind, other than tax liens, mechanics' liens and any liens that attach to
the related Loan by operation of law as a result of any act or omission by the
related Obligor.
"Limited Liability Company Agreement" means the Limited Liability
Company Agreement of the Purchaser, dated as of September 25, 2003, among the
Managing Member and the Issuer, as the same may be amended or supplemented from
time to time.
Annex A to
Loan Purchase and Sale Agreement
5
"Liquidated Loan" means any Loan (i) liquidated through the sale or
other disposition of all or a portion of the related Equipment, (ii) that has
been charged off in its entirety in accordance with the Credit and Collection
Policy without realizing upon the Equipment or (iii) the due date of any
Scheduled Payment of which has been extended, at any time after the Cut-off Date
for an aggregate period of 12 or more calendar months.
"Liquidation Proceeds" means, with respect to any Liquidated Loan, the
amounts collected in respect thereof from whatever source (including the
proceeds of insurance policies with respect to the related Equipment or Obligor)
during the Collection Period in which it became a Liquidated Loan, net of the
sum of any amounts expended in connection with such liquidation and any amounts
required by law to be remitted to the Obligor on such Liquidated Loan or any
creditor of such Obligor to the extent required by applicable law or agreement.
"Litigation" means, with respect to any Person, any action, claim,
lawsuit, demand, investigation or proceeding pending or threatened against such
Person before any court, board, commission, agency or instrumentality of any
federal, state, local or foreign government or of any agency or subdivision
thereof or before any arbitrator or panel of arbitrators.
"Loan" means any Loan included in Schedule of Loans and any agreement
(including any invoice) pursuant to, or under which, an Obligor shall be
obligated to make payments with respect to any Loan.
"Loan Sale Agreement" means the Loan Sale Agreement, dated as of
September 25, 2003, between GE Capital and the Seller, as the same may be
amended or supplemented from time to time.
"Loan Files" is defined in Section 2.1 of the Purchase and Sale
Agreement.
"Loan Value" means, for any Loan that is not a Liquidated Loan or
Defaulted Loan on any day (including the Cut-off Date) (A) with respect to
Precomputed Loans, (i) the present value of the future Scheduled Payments
discounted monthly at its APR plus (ii) the principal amount of any past due
payments plus (iii) the unamortized amounts of any purchase premiums minus (iv)
the unamortized amounts of any purchase discounts, and (B) with respect to
Simple Interest Loans, (i) the balance reflected on the Servicer's records plus
(ii) the unamortized amounts of any purchase premiums minus (iii) the
unamortized amounts of any purchase discounts. Liquidated Loans shall be deemed
to have a Loan Value of zero and Defaulted Loans on any day shall be deemed to
have a Loan Value equal to the outstanding Loan Value on such day computed in
accordance with clauses (A) or (B) above, as applicable, less the amount written
off as uncollectible in accordance with the Credit and Collection Policy.
"Managing Member" means CEF Equipment Holding, L.L.C, a Delaware
limited liability company or any successor Managing Member under the Limited
Liability Company Agreement.
"Material Adverse Effect" means, with respect to any Person, a material
adverse effect on (a) the business, assets, liabilities, operations, prospects
or financial or other condition of such Person, (b) the ability of such Person
to perform any of its obligations under the Related Documents in accordance with
the terms thereof, (c) the validity or enforceability of any Related Document or
the rights and remedies of such Person under any Related Document or (d) the
Loans, as applicable, therefor, any interest related thereto or the ownership
interests or Liens of such Person thereon or the priority of such interests or
Liens.
"Maturity Date" is defined in the Indenture.
Annex A to
Loan Purchase and Sale Agreement
6
"Note Depository Agreement" means the agreement among the Issuer, the
Indenture Trustee and The Depository Trust Company, as the initial clearing
agency, dated as of the Closing Date.
"Notes" means the notes issued under the Indenture.
"Obligor" means, as to each Loan, any Person who owes payments under
the Loan.
"Payment Date" means, with respect to each Collection Period, the 20th
day of the calendar month following the end of that Collection Period, or, if
such day is not a Business Day, the next Business Day, commencing on October 20,
2003.
"Permitted Encumbrances" means the following encumbrances: (a) Liens
for taxes or assessments or other governmental charges not yet due and payable;
(b) pledges or deposits securing obligations under workmen's compensation,
unemployment insurance, social security or public liability laws or similar
legislation; (c) pledges or deposits securing bids, tenders, contracts (other
than contracts for the payment of money) or leases to which the Seller or any
Affiliate thereof is a party as lessee made in the ordinary course of business;
(d) deposits securing statutory obligations of the Seller or any Affiliate
thereof; (e) inchoate and unperfected workers', mechanics', suppliers' or
similar Liens arising in the ordinary course of business; (f) carriers',
warehousemen's or other similar possessory Liens arising in the ordinary course
of business and securing liabilities in an outstanding aggregate amount not in
excess of $100,000 at any one time; (g) deposits securing, or in lieu of,
surety, appeal or customs bonds in proceedings to which the Seller or any
Affiliate thereof is a party; (h) any attachment or judgment Lien not
constituting an Event of Default; (i) presently existing or hereinafter created
Liens in favor of the Purchaser or the Indenture Trustee; and (j) presently
existing or hereinafter created Liens on personal property or Equipment which
are subordinate to or pari passu with the Liens in favor of the Purchaser or the
Indenture Trustee.
"Person" means any individual, sole proprietorship, partnership, joint
venture, unincorporated organization, trust, association, corporation (including
a business trust), limited liability company, institution, public benefit
corporation, joint stock company, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Pool Balance" means, with respect to the beginning of any calendar
month, the sum of the aggregate Loan Values of the Loans at the opening of
business on the first day of such calendar month.
"Precomputed Loan" means any Loan under which the portion of a payment
allocable to earned interest (which may be referred to in the related Loan as an
add-on finance charge) and the portion allocable to principal are determined
according to the sum of periodic balances, the sum of monthly payments or any
equivalent method or are monthly actuarial loans.
"Purchase Amount" means, as of the close of business on the last day of
a Collection Period, an amount equal to the Loan Value of the applicable Loan,
as of the first day of the immediately following Collection Period (or, with
respect to any applicable Loan that is a Liquidated Loan, as of the day
immediately prior to such Loan becoming a Liquidated Loan less
Annex A to
Loan Purchase and Sale Agreement
7
any Liquidation Proceeds actually received by the Purchaser) plus interest
accrued and unpaid thereon as of such last day at a rate per annum equal to the
APR for such Loan.
"Purchase and Sale Agreement" means the Loan Purchase and Sale
Agreement, dated as of September 25, 2003, between the Seller and the Purchaser,
as the same may be amended or supplemented from time to time.
"Purchaser" is defined in the preamble to the Purchase and Sale
Agreement.
"Purchaser Assets" is defined in Section 2.1(a) of the Purchase and
Sale Agreement.
"Purchaser Indemnified Person" is defined in Section 5.1 of the
Purchase and Sale Agreement.
"Purchaser Purchase Price" is defined in Section 2.3 of the Purchase
and Sale Agreement.
"Purchaser Variable Funding Certificate" means the Variable Funding
Certificate issued by the Issuer pursuant to the Limited Liability Company
Agreement.
"Records" means all notes, leases, security agreements and other
documents, books, records and other information (including computer programs,
tapes, disks, data processing software and related property and rights) prepared
and maintained by any of the Seller, the Servicer, any Sub-Servicer or the
Purchaser with respect to the Loans and the Obligors thereunder, and the other
Purchaser Assets.
"Redemption Date" is defined in the Indenture.
"Related Documents" means the Sale Agreement, the Purchase and Sale
Agreement, the Servicing Agreement, the Limited Liability Company Agreement, the
Variable Funding Certificates, the CEF Limited Liability Company Agreement, the
Administration Agreement, the Note Depository Agreement, the Swap Agreements and
all other agreements, instruments, and documents and including all other
pledges, powers of attorney, consents, assignments, contracts, notices, and all
other written matter whether heretofore, now or hereafter executed by or on
behalf of any Person, or any employee of any Person, and delivered in connection
with any of the foregoing. Any reference in the foregoing documents to a Related
Document shall include all Appendices thereto, and all amendments, restatements,
supplements or other modifications thereto, and shall refer to such Related
Document as the same may be in effect at any and all times such reference
becomes operative.
"Related Security" means with respect to any Loan: (a) any interest
(including security interests), if any, in the related Equipment; (b) all
guarantees, insurance or other agreements or arrangements of any kind from time
to time supporting or securing payment of such Loan (including rights (if any)
to receive proceeds on insurance policies covering the Obligors); and (c) all
Records relating to such Loan.
"Sale Agreement" means the Loan Sale Agreement, dated September 25,
2003, between Seller and General Electric Capital Corporation.
Annex A to
Loan Purchase and Sale Agreement
8
"Schedule of Loans" is the schedule of Loans attached as Schedule I
(which schedule may be in the form of microfiche).
"Scheduled Payment" on a Loan means that portion of the payment
required to be made by the Obligor during any Collection Period sufficient to
amortize the principal balance under (x) in the case of a Precomputed Loan, the
actuarial method or (y) in the case of a Simple Interest Loan, the simple
interest method, in each case, over the term of the Loan and to provide interest
at the APR, provided that Termination Values shall also constitute Scheduled
Payments.
"Securities Act" means the provisions of the Securities Act of 1933, 15
U.S.C. Sections 77a et seq., and any regulations promulgated thereunder.
"Securities Exchange Act" means the provisions of the Securities
Exchange Act of 1934, 15 U.S.C. Sections 78a et seq., and any regulations
promulgated thereunder.
"Seller" is defined in the preamble to the Purchase and Sale Agreement.
"Series 2003-1 LLC Supplement" means the Series 2003-1 LLC Supplement
to the Second Amended and Restated Limited Liability Company of CEF Equipment
Holding L.L.C., dated as of September 25, 2003.
"Servicer" means GE Capital in its capacity as Servicer under the
Servicing Agreement, or any other Person designated as a Successor Servicer
thereunder.
"Servicing Agreement" means the Servicing Agreement dated as of
September 25, 2003, by and between the Purchaser and the Servicer, as the same
may be amended or supplemented from time to time.
"Servicing Fee" is defined in the Servicing Agreement.
"Simple Interest Loan" means any Loan under which the portion of a
payment allocable to interest and the portion allocable to principal is
determined by allocating a fixed level payment between principal and interest,
such that such payment is allocated first to the accrued and unpaid interest at
the Annual Percentage Rate for such Loan on the unpaid principal balance and the
remainder of such payment is allocable to principal.
"Solvent" means, with respect to any Person on a particular date, that
on such date (a) the fair value of the property of such Person is greater than
the total amount of liabilities, including contingent liabilities, of such
Person; (b) the present fair salable value of the assets of such Person is not
less than the amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured; (c) such Person does
not intend to, and does not believe that it will, incur debts or liabilities
beyond such Person's ability to pay as such debts and liabilities mature; and
(d) such Person is not engaged in a business or transaction, and is not about to
engage in a business or transaction, for which such Person's property would
constitute an unreasonably small capital. The amount of contingent liabilities
(such as Litigation, guaranties and pension plan liabilities) at any time shall
be computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that can reasonably be expected to
become an actual or matured liability.
Annex A to
Loan Purchase and Sale Agreement
9
"Stock" means all shares, options, warrants, membership interests in a
limited liability company, general or limited partnership interests or other
equivalents (regardless of how designated) of or in a corporation, partnership
or equivalent entity whether voting or nonvoting, including common stock,
preferred stock or any other "equity security" (as such term is defined in Rule
3a11-1 of the General Rules and Regulations promulgated by the Securities and
Exchange Commission under the Securities Exchange Act).
"Stockholder" means, with respect to any Person, each holder of Stock
of such Person.
"Sub-Servicer" means any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
"Sub-Servicing Agreement" means any written contract entered into
between a Servicer and any Sub-Servicer pursuant to and in accordance with the
Servicing Agreement.
"Subsidiary" means, with respect to any Person, any corporation or
other entity (a) of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of directors or other
Persons performing similar functions are at the time directly or indirectly
owned by such Person or (b) that is directly or indirectly controlled by such
Person within the meaning of control under Section 15 of the Securities Act.
"Successor Servicer" is defined in Section 6.2 of the Servicing
Agreement.
"Swap Agreements" is defined in the Indenture.
"Termination Value" means the "Termination Value" (if any) payable by
lessee pursuant to the applicable Loan.
"Transfer Date" is defined in the Indenture.
"Trust Account" is defined in the Indenture.
"UCC" means, with respect to any jurisdiction, the Uniform Commercial
Code as the same may, from time to time, be enacted and in effect in such
jurisdiction.
"Variable Funding Certificates" is defined in the Indenture.
SECTION 2. Other Interpretive Matters. All terms defined directly or by
incorporation in the Purchase and Sale Agreement shall have the defined meanings
when used in any certificate or other document delivered pursuant thereto unless
otherwise defined therein. For purposes of the Purchase and Sale Agreement
(including in this Annex A) and all related certificates and other documents,
unless the context otherwise requires: (a) accounting terms not otherwise
defined in such Agreement, and accounting terms partly defined in such Agreement
to the extent not defined, shall have the respective meanings given to them
under generally accepted accounting principles; and unless otherwise provided,
references to any month, quarter or year refer to a fiscal month, quarter or
year as determined in accordance with the Seller fiscal calendar; (b) terms
defined in Article 9 of the UCC and not otherwise defined in such Agreement are
used as defined in that Article; (c) references to any amount as on deposit or
outstanding on
Annex A to
Loan Purchase and Sale Agreement
10
any particular date means such amount at the close of business on such day; (d)
the words "hereof," "herein" and "hereunder" and words of similar import refer
to such Agreement (or the certificate or other document in which they are used)
as a whole and not to any particular provision of such Agreement (or such
certificate or document); (e) references to any Section, Schedule or Exhibit are
references to Sections, Schedules and Exhibits in or to such Agreement (or the
certificate or other document in which the reference is made), and references to
any paragraph, subsection, clause or other subdivision within any Section or
definition refer to such paragraph, subsection, clause or other subdivision of
such Section or definition; (f) the term "including" means "including without
limitation"; (g) references to any law or regulation refer to that law or
regulation as amended from time to time and include any successor law or
regulation; (h) references to any agreement refer to that agreement as from time
to time amended, restated or supplemented or as the terms of such agreement are
waived or modified in accordance with its terms; (i) references to any Person
include that Person's successors and assigns; and (j) headings are for purposes
of reference only and shall not otherwise affect the meaning or interpretation
of any provision hereof.
Annex A to
Loan Purchase and Sale Agreement
11
