EXECUTION COPY
ASSIGNMENT
For value received, on this 4th day of December, 1998, in accordance
with the Purchase Agreement dated as of December 1, 1998, between the
undersigned (the "Seller") and CPS Receivables Corp. (the "Purchaser") (the
"Linc Purchase Agreement"), the undersigned does hereby sell, transfer, assign
and otherwise convey unto the Purchaser, without recourse (subject to the
obligations in the Linc Purchase Agreement and the Sale and Servicing
Agreement), all right, title and interest of the Seller in and to (i) the
Initial Linc Receivables listed in the Schedule of Linc Receivables and all
monies received thereunder after the Cutoff Date and all Net Liquidation
Proceeds received with respect to such Initial Linc Receivables; (ii) the
security interests in the Financed Vehicles granted by Obligors pursuant to the
Initial Linc Receivables and any other interest of the Seller in such Financed
Vehicles, including, without limitation, the certificates of title or, with
respect to Financed Vehicles in the State of Michigan, other evidence of
ownership with respect to Financed Vehicles; (iii) any proceeds from claims on
any physical damage, credit life and credit accident and health insurance
policies or certificates relating to the Financed Vehicles securing the Initial
Linc Receivables or the Obligors thereunder; (iv) refunds for the costs of
extended service contracts with respect to Financed Vehicles securing the
Initial Linc Receivables, refunds of unearned premiums with respect to credit
life and credit accident and health insurance policies or certificates covering
an Obligor or Financed Vehicle securing the Initial Linc Receivables or his or
her obligations with respect to such a Financed Vehicle and any recourse to
Dealers for any of the foregoing; (v) the Receivable File related to each
Initial Linc Receivable; (vi) the proceeds of any and all of the foregoing and
(vii) all present and future claims, demands, causes and choses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of the
foregoing, including all proceeds of the conversion, voluntary or involuntary,
into cash or other liquid property, all cash proceeds, accounts, accounts
receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing. The foregoing sale does not constitute and is not intended
to result in any assumption by the Purchaser of any obligation of the
undersigned to the Obligors, insurers or any other Person in connection with the
Initial Linc Receivables, the Receivable Files, any insurance policies or any
agreement or instrument relating to any of them.
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the Linc
Purchase Agreement and is to be governed by the Linc Purchase Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Linc Purchase Agreement.
THIS ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed as of the day and year first above written.
LINC ACCEPTANCE COMPANY LLC
By:
Name:
Title:
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EXECUTION COPY
PURCHASE AGREEMENT dated as of this December 1, 1998, by and between
LINC ACCEPTANCE COMPANY LLC, a Delaware limited liability company (the
"Seller"), having its principal executive office at Xxx Xxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxxx 00000, and CPS RECEIVABLES CORP., a California corporation (the
"Purchaser"), having its principal executive office at 00000 Xxxxxx Xxxxxx,
Xxxxxx, XX 00000.
WHEREAS, in the regular course of its business, the Seller purchases
and services through its auto loan programs certain motor vehicle retail
installment sale contracts secured by new and used automobiles, light trucks,
vans or minivans acquired from motor vehicle dealers.
WHEREAS, the Seller and the Purchaser wish to set forth the terms
pursuant to which the Linc Receivables (as hereinafter defined), are to be sold
by the Seller to the Purchaser, which Linc Receivables together with the CPS
Receivables and Samco Receivables will be transferred by the Purchaser, pursuant
to the Sale and Servicing Agreement (as hereinafter defined), to CPS Auto
Receivables Trust 1998-4, which Trust will issue notes under the Indenture (as
hereinafter defined) representing indebtedness of the Trust (the "Notes") and
certificates under the Trust Agreement (as hereinafter defined) representing
beneficial interests in the Trust (the "Certificates" and, together with the
Notes, the "Securities").
NOW, THEREFORE, in consideration of the foregoing, other good and
valuable consideration, and the mutual terms and covenants contained herein, the
parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Terms not defined in this Purchase Agreement shall have the meaning set
forth in the Sale and Servicing Agreement and, if not defined therein, shall
have the meaning set forth in the Indenture. As used in this Purchase Agreement,
the following terms shall, unless the context otherwise requires, have the
following meanings (such meanings to be equally applicable to the singular and
plural forms of the terms defined):
"Agreements" means, collectively, this Purchase Agreement, each
Subsequent Purchase Agreement and the Assignments.
"Assignment" means the Initial Assignments and/or any Subsequent
Assignment.
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"Base Prospectus" means the Prospectus dated November 9, 1998, with
respect to CPS Auto Receivables Trusts and any amendment or supplement thereto.
"Closing Date" means December 4, 1998.
"CPS" means Consumer Portfolio Services, Inc., a California
corporation, and its successors and assigns.
"CPS Purchase Agreement" means the purchase agreement of even date
herewith, between Consumer Portfolio Services, Inc., as seller, and CPS
Receivables Corp., as purchaser, as such agreement may be amended, supplemented
or otherwise modified from time to time in accordance with the terms thereof.
"CPS Receivable" shall have the meaning specified in the CPS Purchase
Agreement.
"Indenture" means the Indenture of even date herewith, between CPS Auto
Receivables Trust 1998-4, as issuer and Norwest Bank Minnesota, National
Association, as trustee.
"Initial Assignment" means the assignment dated December 1, 1998, by
the Seller to the Purchaser, relating to the purchase of the Initial Linc
Receivables and certain other property related thereto by the Purchaser from the
Seller pursuant to this Purchase Agreement which shall be substantially in the
form attached hereto as Exhibit A.
"Initial CPS Receivable" shall have the meaning specified in the CPS
Purchase Agreement.
"Initial Linc Receivable" shall have the meaning specified in the Linc
Purchase Agreement.
"Initial Receivable" means an Initial Samco Receivable, an Initial CPS
Receivable and/or an Initial Linc Receivable.
"Initial Samco Receivable" shall have the meaning specified in the
Samco Purchase Agreement.
"Initial Schedule of Linc Receivables" means the list of Initial Linc
Receivables annexed hereto as of the Closing Date as Exhibit B.
"Initial Transferred CPS Property" shall have the meaning specified in
the CPS Purchase Agreement.
"Initial Transferred Property" shall have the meaning specified in
Section 2.1(a) hereof.
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"Initial Transferred Linc Property" shall have the meaning specified in
Section 2.1(a) hereof.
"Initial Transferred Samco Property" shall have the meaning specified
in the Samco Purchase Agreement.
"Linc" means Linc Acceptance Company LLC, a Delaware limited liability
company, and its successors and assigns.
"Linc Assignments" means the Initial Assignment and any Subsequent
Assignment.
"Linc Purchase Agreement" means this Purchase Agreement, as this
agreement may be amended, supplemented or otherwise modified from time to time
in accordance with the terms hereof.
"Linc Receivable"means the Initial Linc Receivables and the Subsequent
Linc Receivables.
"Obligor(s)" means the purchaser or co-purchasers of a Financed Vehicle
or any other Person who owes or may be liable for payments under a Receivable.
"Prospectus Supplement" means the Prospectus Supplement dated December
2, 1998, relating to the public offering of the Notes and any amendment or
supplement thereto.
"Purchase Agreement" means this Purchase Agreement, as this agreement
may be amended, supplemented or otherwise modified from time to time in
accordance with the terms hereof.
"Purchaser" means CPS Receivables Corp., a California corporation, and
its successors and assigns.
"Receivable" means, collectively, the CPS Receivables, the Linc
Receivables and the Samco Receivables.
"Receivables Purchase Price" means $6,591,854.00.
"Repurchase Event" shall have the meaning specified in Section 6.2
hereof.
"Sale and Servicing Agreement" means the Sale and Servicing Agreement
of even date herewith, among CPS Auto Receivables Trust 1998-4, CPS Receivables
Corp., as seller, Consumer Portfolio Services, Inc., as servicer, and Norwest
Bank Minnesota, National Association, as Trustee and standby servicer, as such
agreement may be amended, supplemented or otherwise modified from time to time
in accordance with the terms thereof.
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"Samco Purchase Agreement" means the purchase agreement of even date
herewith, between Samco Acceptance Company LLC, as seller, and CPS Receivables
Corp., as purchaser.
"Samco Receivable" shall have the meaning specified in the Samco
Purchase Agreement.
"Schedule of CPS Receivables" means the list of CPS Receivables,
annexed as Exhibit B, to the CPS Purchase Agreement, as supplemented by each
Schedule of Subsequent CPS Receivables.
"Schedule of Receivables" means the list of Linc Receivables, annexed
hereto as Exhibit B, as supplemented by each Schedule of Subsequent Linc
Receivables.
"Schedule of Samco Receivables" means the list of Samco Receivables,
annexed as Exhibit B to the Samco Purchase Agreement, as supplemented by each
Schedule of Subsequent Samco Receivables.
"Schedule of Subsequent CPS Receivables" shall have the meaning
specified in the CPS Purchase Agreement.
"Schedule of Subsequent Samco Receivables" shall have the meaning
specified in the Samco Purchase Agreement.
"Schedule of Subsequent Linc Receivables" means the schedule of all
motor vehicle retail financing agreements sold and transferred to the Purchaser
pursuant to a Subsequent Purchase Agreement, which schedule shall be deemed to
supplement the Schedule of Receivables and shall be attached to the related
Subsequent Assignment (and may be in the form of microfiche).
"Seller" means Linc Acceptance Company LLC, a Delaware limited
liability company, in its capacity as seller of the Linc Receivables and the
other Transferred Linc Property relating thereto, and its successors and
assigns.
"Servicer" means Consumer Portfolio Services, Inc., a California
corporation, in its capacity as Servicer of the Receivables, and its successors
and assigns.
"Subsequent Assignment" means a Subsequent CPS Assignment, a Subsequent
Linc Assignment or a Subsequent Samco Assignment, as applicable.
"Subsequent CPS Assignment" shall have the meaning specified in the CPS
Purchase Agreement.
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"Subsequent Linc Assignment" means an assignment substantially in the
form of Exhibit A to the form of Subsequent Purchase Agreement attached as
Exhibit C hereto.
"Subsequent Samco Assignment" shall have the meaning specified in the
Samco Purchase Agreement.
"Subsequent Closing Date" means any day on which Subsequent Linc
Receivables are sold to the Purchaser pursuant to a Subsequent Purchase
Agreement.
"Subsequent CPS Receivable" shall have the meaning specified in the CPS
Purchase Agreement.
"Subsequent Linc Receivable" means each Receivable transferred to the
Purchaser pursuant to a Subsequent Assignment which shall be listed on the
Schedule of Subsequent Receivables attached to the related Subsequent
Assignment.
"Subsequent Purchase Agreement" means a subsequent purchase agreement
which shall be in substantially the form of Exhibit C to this Purchase Agreement
by which the Seller will transfer Subsequent Linc Receivables.
"Subsequent Receivables" means a Subsequent CPS Receivable, a
Subsequent Linc Receivable, a Subsequent Samco Receivable.
"Subsequent Receivables Purchase Price" shall, with respect to any
Subsequent Receivables, have the meaning specified in the related Subsequent
Purchase Agreement.
"Subsequent Samco Receivable" shall have the meaning specified in the
Samco Purchase Agreement.
"Subsequent Transferred Property" shall have the meaning specified in
Section 2.2(a)
"Subsequent Transferred Linc Property" shall have the meaning specified
in each Subsequent Purchase Agreement.
"Transferred CPS Property" shall have the meaning specified in the CPS
Purchase Agreement.
"Transferred Linc Property" means the Initial Transferred Linc Property
and the Subsequent Transferred Linc Property.
"Transferred Property" means the Transferred CPS Property, the
Transferred Linc Property and the Transferred Samco Property.
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"Transferred Samco Property" shall have the meaning specified in the
Samco Purchase Agreement.
"Trust" means the CPS Auto Receivables Trust 1998-4 created by the
Trust Agreement.
"Trust Agreement" means the Amended and Restated Trust Agreement of
even date herewith between CPS Receivables Corp. and Bankers Trust (Delaware),
as Owner Trustee.
"UCC" means the Uniform Commercial Code, as in effect from time to time
in the relevant jurisdictions.
"Underwriter" means First Union Capital Markets, a division of Wheat
First Securities, Inc..
"Underwriting Agreement" means the Underwriting Agreement relating to
the Notes, of even date herewith, among the Underwriter, CPS, Linc, Samco and
the Purchaser.
ARTICLE II
PURCHASE AND SALE OF RECEIVABLES
2.1. Purchase and Sale of Initial Receivables. On the Closing Date,
subject to the terms and conditions of this Purchase Agreement, the Seller
agrees to sell to the Purchaser, and the Purchaser agrees to purchase from the
Seller, without recourse (subject to the obligations in this Purchase Agreement
and the Sale and Servicing Agreement), all of the Seller's right, title and
interest in, to and under the Linc Receivables and the other Initial Transferred
Linc Property relating thereto. The conveyance to the Purchaser of the Linc
Receivables and other Transferred Linc Property relating thereto is intended as
a sale free and clear of all liens and it is intended that the Transferred Linc
Property and other property of the Purchaser shall not be part of the Seller's
estate in the event of the filing of a bankruptcy petition by or against the
Seller under any bankruptcy law.
(a) Transfer of Receivables. On the Closing Date and
simultaneously with the transactions to be consummated pursuant to the Trust
Agreement, the Indenture and the Sale and Servicing Agreement, the Seller shall
sell, transfer, assign, grant, set over and otherwise convey to the Purchaser,
without recourse (subject to the obligations herein and in the Sale and
Servicing Agreement), all right, title and interest of the Seller in and to (i)
the Initial Linc Receivables listed in the Schedule of Linc Receivables and all
monies received thereunder after the Cutoff Date and all Net Liquidation
Proceeds received with respect to such Initial Linc Receivables; (ii) the
security interests in the Financed Vehicles granted by Obligors pursuant to the
Linc Receivables and any other interest of the Seller in such Financed Vehicles,
including, without limitation, the certificates of title or, with respect to
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Financed Vehicles in the State of Michigan, other evidence of ownership with
respect to Financed Vehicles; (iii) any proceeds from claims on any physical
damage, credit life and credit accident and health insurance policies or
certificates relating to the Financed Vehicles securing the Linc Receivables or
the Obligors thereunder; (iv) refunds for the costs of extended service
contracts with respect to Financed Vehicles securing the Linc Receivables,
refunds of unearned premiums with respect to credit life and credit accident and
health insurance policies or certificates covering an Obligor or Financed
Vehicle securing the Linc Receivables or his or her obligations with respect to
such a Financed Vehicle and any recourse to Dealers for any of the foregoing;
(v) the Receivable File related to each Linc Receivable; (vi) the proceeds of
any and all of the foregoing and (vii) all present and future claims, demands,
causes and choses in action in respect of any or all of the foregoing and all
payments on or under and all proceeds of every kind and nature whatsoever in
respect of any or all of the foregoing, including all proceeds of the
conversion, voluntary or involuntary, into cash or other liquid property, all
cash proceeds, accounts, accounts receivable, notes, drafts, acceptances,
chattel paper, checks, deposit accounts, insurance proceeds, condemnation
awards, rights to payment of any and every kind and other forms of obligations
and receivables, instruments and other property which at any time constitute all
or part of or are included in the proceeds of any of the foregoing
(collectively, the "Initial Transferred Linc Property" and together with the
Transferred CPS Property and the Transferred Samco Property, the "Initial
Transferred Property").
(b) Initial Receivables Purchase Price. In consideration for the
Initial Linc Receivables and other Initial Transferred Linc Property described
in Section 2.1(a), the Purchaser shall, on the Closing Date, pay to the Seller
the Receivables Purchase Price by federal wire transfer (same day) funds.
2.2. Purchase and Sale of Subsequent Receivables. On the related
Subsequent Closing Date, subject to the terms and conditions of the related
Subsequent Purchase Agreement, the Seller agrees to sell to the Purchaser, and
the Purchaser agrees to purchase from the Seller, without recourse (subject to
the obligations in this Purchase Agreement, each Subsequent Purchase Agreement
and the Sale and Servicing Agreement), all of the Seller's right, title and
interest in, to and under the Subsequent Linc Receivables and the other
Subsequent Transferred Linc Property relating thereto. The conveyance to the
Purchaser of the Subsequent Linc Receivables and other Subsequent Transferred
Linc Property relating thereto is intended as a sale free and clear of all liens
and it is intended that the Subsequent Transferred Linc Property and other
property of the Purchaser shall not be part of the Seller's estate in the event
of the filing of a bankruptcy petition by or against the Seller under any
bankruptcy law.
(a) Transfer of Subsequent Receivables. On the related Subsequent
Closing Date the Seller shall sell, transfer, assign, grant, set over and
otherwise convey to the Purchaser, without recourse (subject to the obligations
in this Purchase Agreement, each Subsequent Purchase Agreement and in the Sale
and Servicing Agreement), all right, title and interest of the Seller in and to
(i) the Subsequent Linc Receivables listed in the related
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Schedule of Subsequent Linc Receivables and all monies received thereunder after
the related Subsequent Cutoff Date and all Net Liquidation Proceeds received
with respect to such Subsequent Linc Receivables; (ii) the security interests in
the Financed Vehicles granted by Obligors pursuant to the Subsequent Linc
Receivables and any other interest of the Seller in such Financed Vehicles,
including, without limitation, the certificates of title or, with respect to
Financed Vehicles in the State of Michigan, other evidence of ownership with
respect to Financed Vehicles; (iii) any proceeds from claims on any physical
damage, credit life and credit accident and health insurance policies or
certificates relating to the Financed Vehicles securing the Subsequent Linc
Receivables or the Obligors thereunder; (iv) refunds for the costs of extended
service contracts with respect to Financed Vehicles securing the Subsequent Linc
Receivables, refunds of unearned premiums with respect to credit life and credit
accident and health insurance policies or certificates covering an Obligor or
Financed Vehicle securing the Subsequent Linc Receivables or his or her
obligations with respect to such a Financed Vehicle and any recourse to Dealers
for any of the foregoing; (v) the Receivable File related to each Subsequent
Linc Receivable; (vi) the proceeds of any and all of the foregoing and (vii) all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing and all payments on or under and all proceeds of
every kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion, voluntary or involuntary, into cash or
other liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, condemnation awards, rights to payment of any and every kind and other
forms of obligations and receivables, instruments and other property which at
any time constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the "Subsequent Transferred Linc Property" and together
with any Subsequent Transferred CPS Property and/or Subsequent Transferred Samco
Property, the "Subsequent Transferred Property").
(b) The Seller shall transfer to the Purchaser the Subsequent Linc
Receivables and the Subsequent Transferred Linc Property as described in
paragraph (a) above only upon the satisfaction of each of the following
conditions on or prior to the related Subsequent Closing Date:
(i) the Seller shall have provided the Trustee, the Owner
Trustee, the Note Insurer and the Rating Agencies with an Addition
Notice not later than three days prior to such Subsequent Closing Date
and shall have provided any information reasonably requested by any of
the foregoing with respect to the Subsequent Linc Receivables;
(ii) the Seller shall have delivered to the Owner Trustee and
the Trustee a duly executed Subsequent Purchase Agreement,
substantially in the form of Exhibit C, which shall include a
supplement to the Schedule of Linc Receivables, listing the Subsequent
Linc Receivables to be transferred on the related Subsequent Closing
Date;
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(iii) the Seller shall, to the extent required by Section 4.2
of the Sale and Servicing Agreement, have deposited in the Collection
Account all collections in respect of the Subsequent Linc Receivables;
(iv) as of each Subsequent Closing Date, (A) the Seller shall
not be insolvent and shall not become insolvent as a result of the
transfer of Subsequent Linc Receivables on such Subsequent Closing
Date, (B) the Seller shall not intend to incur or believe that it shall
incur debts that would be beyond its ability to pay as such debts
mature, (C) such transfer shall not have been made with actual intent
to hinder, delay or defraud any Person and (D) the assets of the Seller
shall not constitute unreasonably small capital to carry out its
business as then conducted;
(v) the Funding Period shall not have terminated;
(vi) after giving effect to any transfer of Subsequent Linc
Receivables on a Subsequent Closing Date, the Receivables shall meet
the following criteria (based on the characteristics of the Initial
Receivables on the Initial Cutoff Date and the Subsequent Receivables
on the related Subsequent Cutoff Dates): (A) the weighted average APR
of such Receivables will not be less than 0.25% below the weighted
average APR of the Initial Receivables on the Cutoff Date, (B) the
weighted average remaining term of such Receivables will be within a
range of 12 to 72 months, (C) not more than 90% of the aggregate
principal balance of such Receivables will represent financing of used
Financed Vehicles, (D) no fewer than 50% of the Subsequent Receivables
will be originated under the "Alpha" program, (E) not more than 8% of
the Subsequent Receivables will be originated under the Delta program,
(F) no more than 5.25% of the Subsequent Receivables will be originated
under the "First Time Buyer" program, (G) no fewer than 20% and no more
than 30% of the Subsequent Receivables will be originated under the
"Standard" program, and (H) the Trust, the Trustee, the Owner Trustee
and the Note Insurer shall have received written confirmation from a
firm of certified independent public accountants as to the satisfaction
of the criteria in clauses (A) through (G) above;
(vii) each of the representations and warranties made by the
Seller pursuant to Section 3.2 with respect to the Subsequent Linc
Receivables to be transferred on such Subsequent Closing Date shall be
true and correct as of the related Subsequent Closing Date, and the
Seller shall have performed all obligations to be performed by it
hereunder on or prior to such Subsequent Closing Date;
(viii) the Seller shall, at its own expense, on or prior to
the Subsequent Closing Date indicate in its computer files that the
Subsequent Linc Receivables identified in the Subsequent Purchase
Agreement have been sold to the Purchaser pursuant to the related
Subsequent Purchase Agreement and subsequently to the Trust pursuant to
the Sale and Servicing Agreement;
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(ix) the Seller shall have taken any action required to
maintain the first priority perfected ownership interest of the Trust
in the Owner Trust Estate and the first priority perfected security
interest of the Trustee in the Collateral;
(x) no selection procedures adverse to the interests of the
Noteholders or the Note Insurer shall have been utilized in selecting
the Subsequent Linc Receivables;
(xi) the addition of any such Subsequent Linc Receivables
shall not result in a material adverse tax consequence to the Trust or
the Noteholders;
(xii) the Seller shall have delivered (A) to the Rating
Agencies and the Note Insurer an Opinion of Counsel with respect to the
transfer of such Subsequent Linc Receivables substantially in the form
of the Opinion of Counsel delivered to the Rating Agencies and the Note
Insurer on the related Closing Date and (B) to the Trustee the Opinion
of Counsel required by Section 13.2(i)(1) of the Sale and Servicing
Agreement;
(xiii) each Rating Agency shall have confirmed that the rating
on the Notes shall not be withdrawn or reduced as a result of the
transfer of such Subsequent Linc Receivables to the Trust;
(xiv) all conditions precedent specified in the Sale and
Servicing Agreement with respect to the transfer of such Subsequent CPS
Receivables to the Trust by the Purchaser shall have been satisfied;
and
(xv) the Seller shall have delivered to the Note Insurer and
the Trustee an Officers' Certificate confirming the satisfaction of
each condition precedent specified in this paragraph (b).
2.3. The Closing. The sale and purchase of the Initial Linc Receivables
shall take place at a closing (the "Closing") at the offices of Xxxxx, Brown &
Xxxxx, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000-5820 on the Initial Closing Date,
simultaneously with the closings under: (a) the CPS Purchase Agreement pursuant
to which CPS will sell the Initial CPS Receivables to the Purchaser, (b) the
Samco Purchase Agreement pursuant to which Samco will sell the Initial Samco
Receivables to the Purchaser, (c) the Sale and Servicing Agreement pursuant to
which the Purchaser will assign all of its right, title and interest in and to
the Initial Receivables and the other Initial Transferred Property to the Trust
for the benefit of the Securityholders, (d) the Trust Agreement pursuant to
which the Trust shall be formed and the Certificates issued, (e) the Indenture
pursuant to which the Trust will issue the Notes, and (f) the Underwriting
Agreement pursuant to which the Purchaser shall sell the Notes to the
Underwriter.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1. Representations and Warranties of the Purchaser. The Purchaser
hereby represents and warrants to the Seller as of the date hereof and as of the
Closing Date (which representations and warranties shall survive the Closing
Date and each Subsequent Closing Date):
(a) Organization and Good Standing. The Purchaser has been duly
organized and is validly existing as a corporation in good standing under the
laws of the State of California, with power and authority to own its properties
and to conduct its business as such properties shall be currently owned and such
business is presently conducted, and had at all relevant times, and shall have,
power, authority and legal right to acquire and own the Linc Receivables.
(b) Due Qualification. The Purchaser is duly qualified to do business
as a foreign corporation in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions in which the ownership or lease of
property or the conduct of its business shall require such qualifications.
(c) Power and Authority. The Purchaser has the power and authority to
execute and deliver the Agreements and to carry out its terms and the execution,
delivery and performance of the Agreements has been duly authorized by the
Purchaser by all necessary corporate action.
(d) Binding Obligation. The Agreements shall constitute a legal, valid
and binding obligation of the Purchaser enforceable in accordance with its
terms.
(e) No Violation. The execution, delivery and performance by the
Purchaser of the Agreements and the consummation of the transactions
contemplated hereby and the fulfillment of the terms hereof do not conflict
with, result in a breach of any of the terms and provisions of, nor constitute
(with or without notice or lapse of time) a default under, the articles of
incorporation or by-laws of the Purchaser, or any indenture, agreement,
mortgage, deed of trust, or other instrument to which the Purchaser is a party
or by which it is bound or to which any of its properties are subject; nor
result in the creation or imposition of any lien upon any of its properties
pursuant to the terms of any indenture, agreement, mortgage, deed of trust, or
other instrument (other than the Basic Documents); nor violate any law, order,
rule or regulation applicable to the Purchaser of any court or of any Federal or
State regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Purchaser or its properties.
(f) No Proceedings. There are no proceedings or investigations pending,
or to the Purchaser's best knowledge, threatened, before any court, regulatory
body,
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administrative agency or other governmental instrumentality having jurisdiction
over the Purchaser or its properties: (A) asserting the invalidity of the
Agreements or the Securities; (B) seeking to prevent the issuance of the
Securities or the consummation of any of the transactions contemplated by the
Agreements; (C) seeking any determination or ruling that might materially and
adversely affect the performance by the Purchaser of its obligations under, or
the validity or enforceability of, the Agreements or the Securities; or (D)
relating to the Purchaser and which might adversely affect the Federal or State
income, excise, franchise or similar tax attributes of the Securities.
(g) No Consents. No consent, approval, authorization or order of or
declaration or filing with any governmental authority is required to be obtained
by the Purchaser for the issuance or sale of the Securities or the consummation
of the other transactions contemplated by the Agreements, the Trust Agreement,
the Indenture or the Sale and Servicing Agreement, except such as have been duly
made or obtained.
3.2. Representations and Warranties of the Seller. (a) The Seller
hereby represents and warrants to the Purchaser as of the date hereof and as of
the Closing Date and each Subsequent Closing Date (which representations and
warranties shall survive the Closing Date and each Subsequent Closing Date):
(i) Organization and Good Standing. The Seller has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware, with power and authority to
own its properties and to conduct its business as such properties shall
be currently owned and such business is presently conducted and had at
all relevant times, and shall have, power, authority and legal right to
acquire, and own the Linc Receivables.
(ii) Due Qualification. The Seller is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals in all jurisdictions in which the
ownership or lease of property or the conduct of its business
(including the origination of the Linc Receivables as required by the
Sale and Servicing Agreement) shall require such qualifications.
(iii) Power and Authority. The Seller has the power and
authority to execute and deliver this Agreement and to carry out its
terms; the Seller has full power and authority to sell and assign the
property sold and assigned to the Purchaser and has duly authorized
such sale and assignment to the Purchaser by all necessary corporate
action; and the execution, delivery and performance of the Agreements
has been duly authorized by the Seller by all necessary corporate
action.
(iv) Valid Sale; Binding Obligation. This Agreement effects a
valid sale, transfer and assignment of the Initial Linc Receivables and
the other Initial Transferred Linc Property conveyed to the Purchaser
pursuant to Sections 2.1 and 2.2, enforceable against creditors of and
purchasers from the Seller; and this
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Agreement shall constitute a legal, valid and binding obligation of the
Seller enforceable in accordance with its terms.
(v) No Violation. The execution, delivery and performance by
the Seller of the Agreements and the consummation of the transactions
contemplated hereby and the fulfillment of the terms hereof do not
conflict with, result in any breach of any of the terms and provisions
of, nor constitute (with or without notice or lapse of time) a default
under, the articles of incorporation, as amended, or by-laws of the
Seller, or any indenture, agreement, mortgage, deed of trust, or other
instrument to which the Seller is a party or by which it is bound or to
which any of its properties are subject; nor result in the creation or
imposition of any lien upon any of its properties pursuant to the terms
of any such indenture, agreement, mortgage, deed of trust, or other
instrument (other than the Basic Documents); nor violate any law,
order, rule or regulation applicable to the Seller of any court or of
any Federal or State regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Seller or its
properties.
(vi) No Proceedings. There are no proceedings or
investigations pending, or to the Seller's best knowledge, threatened,
before any court, regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over the Seller or its
properties: (A) asserting the invalidity of the Agreements or the
Securities; (B) seeking to prevent the issuance of the Securities or
the consummation of any of the transactions contemplated by the
Agreements; (C) seeking any determination or ruling that might
materially and adversely affect the performance by the Seller of its
obligations under, or the validity or enforceability of, the Agreements
or the Securities; or (D) relating to the Seller and which might
adversely affect the Federal or State income, excise, franchise or
similar tax attributes of the Securities.
(vii) No Consents. No consent, approval, authorization or
order of or declaration or filing with any governmental authority is
required for the issuance or sale of the Securities or the consummation
of the other transactions contemplated by the Agreements, the Trust
Agreement, the Indenture or the Sale and Servicing Agreement, except
such as have been duly made or obtained.
(viii) Financial Condition. The Seller has a positive net
worth and is able to and does pay its liabilities as they mature. The
Seller is not in default under any obligation to pay money to any
Person except for matters being disputed in good faith which do not
involve an obligation of the Seller on a promissory note. The Seller
will not use the proceeds from the transactions contemplated by this
Agreement to give any preference to any creditor or class of creditors,
and this transaction will not leave the Seller with remaining assets
which are unreasonably small compared to its ongoing operations.
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(ix) Fraudulent Conveyance. The Seller is not selling the Linc
Receivables to the Purchaser with any intent to hinder, delay or
defraud any of its creditors; the Seller will not be rendered insolvent
as a result of the sale of the Linc Receivables to the Purchaser.
(b) The Seller makes the following representations and warranties as to
the Linc Receivables and the other Transferred Linc Property relating thereto on
which the Purchaser relies in accepting the Linc Receivables and the other
Transferred Linc Property relating thereto. Such representations and warranties
speak as of the execution and delivery of this Agreement and as of the Closing
Date, in the case of the Initial Receivables, and as of the related Subsequent
Transfer Date, in case of the Subsequent Receivables, but shall survive the
sale, transfer, and assignment of the Linc Receivables and the other Transferred
Linc Property relating thereto to the Purchaser and the subsequent assignments
and transfers pursuant to the Sale and Servicing Agreement and the Indenture:
(i) Location of Receivable Files; One Original. A complete
Receivable File with respect to each Initial Linc Receivable has been
or prior to the Closing Date will be delivered to the Trustee at the
location listed in Schedule B to the Sale and Servicing Agreement.
There is only one original executed copy of each Linc Receivable.
(ii) Schedule of Receivables; Selection Procedures. The
information with respect to the Linc Receivables set forth in the
Schedule of Linc Receivables as the same may be amended by subsequent
Schedules of Linc Receivables is true and correct in all material
respects as of the close of business on the related Cutoff Date, and no
selection procedures adverse to the Securityholders have been utilized
in selecting the Linc Receivables.
(iii) Security Interest in Financed Vehicle. Immediately prior
to the sale, assignment, and transfer thereof, each Linc Receivable
shall be secured by a validly perfected first priority security
interest in the related Financed Vehicle in favor of the Seller as
secured party, and such security interest is prior to all other liens
upon and security interests in such Financed Vehicle which now exist or
may hereafter arise or be created (except, as to priority, for any tax
liens or mechanics' liens which may arise after the Closing Date, in
the case of the Initial Receivables, or after the related Subsequent
Closing Date, in the case of the Subsequent Receivables).
(iv) Linc Receivables in Force. No Linc Receivable has been
satisfied, subordinated or rescinded, nor has any Financed Vehicle been
released from the lien granted by the related Linc Receivable in whole
or in part.
(v) No Waiver. No provision of a Linc Receivable has been
waived.
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(vi) No Amendments. No Linc Receivable has been amended,
except as such Linc Receivable may have been amended to grant
extensions which shall not have numbered more than (a) one extension of
one calendar month in any calendar year or (b) three such extensions in
the aggregate.
(vii) No Default; Repossession. Except for payment
delinquencies continuing for a period of not more than thirty days as
of the Cutoff Date (with respect to the Initial Receivables) or the
Subsequent Cutoff Date (wth respect to the related Subsequent
Receivables), no default, breach, violation or event permitting
acceleration under the terms of any Linc Receivable has occurred; and
no continuing condition that with notice or the lapse of time would
constitute a default, breach, violation, or event permitting
acceleration under the terms of any Linc Receivable has arisen; and the
Seller shall not waive and has not waived any of the foregoing; and no
Financed Vehicle securing a Linc Receivable shall have been repossessed
as of the Cutoff Date (with respect to the Initial Receivables) or the
Subsequent Cutoff Date (with respect to the related Subsequent
Receivables).
(viii) Title. It is the intention of the Seller that the
transfer and assignment herein contemplated constitute a sale of the
Linc Receivables and other Transferred Linc Property from the Seller to
the Purchaser and that the beneficial interest in and title to such
Linc Receivables and other Transferred Linc Property not be part of the
debtor's estate in the event of the filing of a bankruptcy petition by
or against the Seller under any bankruptcy law. No Linc Receivable or
other Transferred Linc Property has been sold, transferred, assigned,
or pledged by the Seller to any Person other than the Purchaser or any
such pledge has been released on or prior to the Closing Date.
Immediately prior to any transfer and assignment herein contemplated,
the Seller had good and marketable title to each Linc Receivable and
other Transferred Linc Property, and was the sole owner thereof, free
and clear of all liens, claims, encumbrances, security interests, and
rights of others and, immediately upon the transfer thereof, the
Purchaser shall have good and marketable title to each such Linc
Receivable and other Transferred Linc Property, and will be the sole
owner thereof, free and clear of all liens, encumbrances, security
interests, and rights of others, and the transfer has been perfected
under the UCC.
(ix) Lawful Assignment. No Linc Receivable has been originated
in, or is subject to the laws of, any jurisdiction under which the
sale, transfer, and assignment of such Linc Receivable under the
Agreements shall be unlawful, void, or voidable. The Seller has not
entered into any agreement with any account debtor that prohibits,
restricts or conditions the assignment of any portion of the Linc
Receivables.
(x) All Filings Made. All filings (including, without
limitation, UCC filings) necessary in any jurisdiction to give the
Purchaser a first priority
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perfected ownership interest in the Linc Receivables and the other
Transferred Linc Property have been made, taken or performed.
(xi) Casualty. No Financed Vehicle related to a Receivable has
suffered a Casualty.
(xii) Obligation to Dealers or Others. The Purchaser and its
assignees will assume no obligation to Dealers or other originators or
holders of the Linc Receivables (including, but not limited to under
dealer reserves) as a result of the purchase of the Linc Receivables.
(xiii) Full Amount Advanced. The full amount of each Linc
Receivable has been advanced to each Obligor, and there are no
requirements for future advances thereunder. No Obligor with respect to
a Linc Receivable has any option under the Linc Receivable to borrow
from any Person additional funds secured by the related Financed
Vehicle.
(c) The representations and warranties contained in this Agreement
shall not be construed as a warranty or guaranty by the Seller as to the future
payments by any Obligor. The sale of the Initial Linc Receivables pursuant to
this Agreement shall be "without recourse" to the Seller except for the
representations, warranties and covenants made by the Seller in this Purchase
Agreement.
ARTICLE IV
CONDITIONS
4.1. Conditions to Obligation of the Purchaser. On the applicable
Closing Date and on each Subsequent Closing Date, the obligation of the
Purchaser to purchase the related Linc Receivables is subject to the
satisfaction of the following conditions:
(a) Representations and Warranties True. The representations and
warranties of the Seller hereunder shall be true and correct on the Closing Date
or the related Subsequent Closing Date, as applicable, with the same effect as
if then made, and the Seller shall have performed all obligations to be
performed by it hereunder on or prior to the Closing Date or the related
Subsequent Closing Date, as applicable.
(b) Computer Files Marked. The Seller shall, at its own expense, on or
prior to the Closing Date or the related Subsequent Closing Date, as applicable,
indicate in its computer files that the related Linc Receivables have been sold
to the Purchaser pursuant to the Agreements and shall deliver to the Purchaser
the Schedule of Linc Receivables certified by the Chairman, the President, the
Vice President or the Treasurer of the Seller to
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be true, correct and complete as of, and after giving effect to all transfers of
Receivables on, the Closing Date or the related Subsequent Closing Date, as
applicable.
(c) Receivable Files Delivered. The Seller shall, at its own expense,
deliver the related Receivable Files to the Trustee at the offices specified in
Schedule B to the Sale and Servicing Agreement on or prior to the related
Closing Date or the related Subsequent Closing Date, as applicable.
(d) Documents to be delivered by the Seller on each Closing Date.
(i) The Assignment. On the Closing Date, the Seller will
execute and deliver the Initial Linc Assignment. The Initial Linc
Assignment shall be substantially in the form of Exhibit A hereto. On
each Subsequent Closing Date, the Seller will execute and deliver the
related Subsequent Assignment. Each Subsequent Assignment shall be in
the form of Exhibit A to the form of the Subsequent Purchase Agreement
attached as Exhibit C hereto.
(ii) Evidence of UCC-1 Filing. On or prior to the Closing
Date, the Seller shall record and file, at its own expense, a UCC-1
financing statement in each jurisdiction in which required by
applicable law, executed by the Seller, as seller or debtor, and naming
the Purchaser, as purchaser or secured party, naming the Linc
Receivables and the other Transferred Linc Property conveyed hereafter
as collateral, meeting the requirements of the laws of each such
jurisdiction and in such manner as is necessary to perfect the sale,
transfer, assignment and conveyance of such Linc Receivables to the
Purchaser. The Seller shall deliver a file-stamped copy, or other
evidence satisfactory to the Purchaser of such filing, to the Purchaser
on or prior to the Closing Date.
(iii) Other Documents. On or prior to the Closing Date or
Subsequent Closing Date, as applicable, the Seller shall deliver such
other documents as the Purchaser may reasonably request.
(e) Other Transactions. The transactions contemplated by the Trust
Agreement, the Indenture, the Sale and Servicing Agreement, the Initial CPS
Purchase Agreement, the Samco Purchase Agreement, the Underwriting Agreement and
the Certificate Purchase Agreement shall be consummated on the Closing Date or
Subsequent Closing Date, as applicable.
4.2. Conditions to Obligation of the Seller. The obligation of the
Seller to sell the Initial Receivables or Subsequent Receivables, as applicable,
to the Purchaser is subject to the satisfaction of the following conditions:
(a) Representations and Warranties True. The representations
and warranties of the Purchaser hereunder shall be true and correct on
the Closing Date or
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Subsequent Closing Date, as applicable, with the same effect as if then made,
and the Seller shall have performed all obligations to be performed by it
hereunder on or prior to the Closing Date or Subsquent Closing Date, as
applicable.
(b) Receivables Purchase Price. On the Closing Date, the
Purchaser will deliver to the Seller the Initial Receivables Purchase
Price as provided in Section 2.1(b). The Seller hereby directs the
Purchaser to wire such purchase price to wire instructions to be
delivered to the Purchaser on or prior to the Initial Closing Date. On
each Subsequent Closing Date, the Purchaser will deliver to the Seller
the Subsequent Receivables Purchase Price for the Subsequent Linc
Receivables to be transferred to the Purchaser on such Subsequent
Closing Date.
ARTICLE V
COVENANTS OF THE SELLER
The Seller agrees with the Purchaser as follows:
5.1. Protection of Right, Title and Interest.
(a) Filings. The Seller shall cause all financing statements and
continuation statements and any other necessary documents covering the right,
title and interest of the Purchaser in and to the Linc Receivables and the other
Transferred Linc Property to be promptly 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 fully to preserve and protect the right, title and interest of
the Purchaser hereunder to the Linc Receivables and the other Transferred Linc
Property. The Seller shall cause to be delivered to the Purchaser file stamped
copies of, or filing receipts for, any document recorded, registered or filed as
provided above, as soon as available following such recordation, registration or
filing. The Purchaser shall cooperate fully with the Seller in connection with
the obligations set forth above and will execute any and all documents
reasonably required to fulfill the intent of this Section 5.1(a). In the event
the Seller fails to perform its obligations under this subsection, the Purchaser
or the Trustee may do so at the expense of the Seller.
(b) Name and Other Changes. At least 60 days prior to the date the
Seller makes any change in its name, identity or corporate structure which would
make any financing statement or continuation statement filed in accordance with
paragraph (a) above seriously misleading within the applicable provisions of the
UCC or any title statute, the Seller shall give the Trustee, the Note Insurer
(so long as an Insurer Default shall not have occurred and be continuing) and
the Purchaser written notice of any such change and no later than five days
after the effective date thereof, shall file appropriate amendments to all
previously filed financing statements or continuation statements. At least 60
days prior to the date of any relocation of its principal executive office, the
Seller shall give the Trustee, the
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Note Insurer (so long as an Insurer Default shall not have occurred and be
continuing) and the Purchaser written notice thereof if, as a result of such
relocation, the applicable provisions of the UCC would require the filing of any
amendment of any previously filed financing or continuation statement or of any
new financing statement and the Seller shall within five days after the
effective date thereof, file any such amendment or new financing statement. The
Seller shall at all times maintain each office from which it shall service
Receivables, and its principal executive office, within the United States of
America.
(c) Maintenance of Computer Systems. The Seller shall maintain its
computer systems so that, from and after the time of sale to the Purchaser of
the Linc Receivables hereunder, the Seller's master computer records (including
any back-up archives) that refer to a Linc Receivable shall indicate clearly the
interest of the Purchaser in such Linc Receivable and that such Linc Receivable
is owned by the Purchaser. Indication of the Purchaser's ownership of a Linc
Receivable shall be deleted from or modified on the Seller's computer systems
when, and only when, the Linc Receivable shall have been paid in full or
repurchased.
(d) Sale of Other Receivables. If at any time the Seller shall propose
to sell, grant a security interest in, or otherwise transfer any interest in any
automobile or light-duty truck receivables (other than the Linc Receivables) to
any prospective purchaser, lender, or other transferee, the Seller shall give to
such prospective purchaser, lender, or other transferee computer tapes, records,
or print-outs (including any restored from back-up archives) that, if they shall
refer in any manner whatsoever to any Linc Receivable, shall indicate clearly
that such Linc Receivable has been sold and is owned by the Purchaser unless
such Linc Receivable has been paid in full or repurchased.
(e) Access to Records. The Seller shall permit the Purchaser and its
agents at any time during normal business hours to inspect, audit, and make
copies of and abstracts from the Seller's records regarding any Linc Receivable.
(f) List of Receivables. Upon request, the Seller shall furnish to the
Purchaser, within five Business Days, a list of all Linc Receivables (by
contract number and name of Obligor) then owned by the Purchaser, together with
a reconciliation of such list to the Schedule of Linc Receivables.
5.2. Other Liens or Interests. Except for the conveyances hereunder and
pursuant to the Sale and Servicing Agreement, the Seller will not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume or
suffer to exist any lien on any interest therein, and the Seller shall defend
the right, title, and interest of the Purchaser in, to and under the Linc
Receivables against all claims of third parties claiming through or under the
Seller.
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5.3. Chief Executive Office. During the term of the Linc Receivables,
the Seller will maintain its chief executive office in one of the United States,
except Louisiana or Vermont.
5.4. Costs and Expenses. The Seller agrees to pay all reasonable costs
and disbursements in connection with the perfection, as against all third
parties, of the Purchaser's right, title and interest in and to the Linc
Receivables.
5.5. Delivery of Receivable Files. On or prior to the Closing Date, the
Seller shall cause to be delivered to the Trustee at the location specified in
Schedule B to the Sale and Servicing Agreement the Receivables Files relating to
the Initial Receivables. On or prior to each Subsequent Closing Date, the Seller
shall deliver the Receivable Files for the related Subsequent Receivables to the
Trustee at the location specified in Schedule B to the Sale and Servicing
Agreement. The Seller shall have until the last day of the second Collection
Period following receipt of notification that there has been a failure to
deliver a file with respect to a Linc Receivable or that a file is unrelated to
the Receivables identified in Schedule A to the Sale and Servicing Agreement or
that any of the documents referred to in Section 3.3 of the Sale and Servicing
Agreement are not contained in a Receivable File, to deliver such file or any of
the aforementioned documents required to be included in such Receivable File to
the Trustee. Unless such defect with respect to such Receivable File shall have
been cured by the last day of the second Collection Period following discovery
thereof by the Trustee and notice thereof to Linc, the Seller hereby agrees to
repurchase any such Receivable from the Trust as of such last day. In
consideration of the purchase of the Receivable, the Seller shall remit the
Purchase Amount in the manner specified in Section 4.7 of the Sale and Servicing
Agreement. The sole remedy hereunder of the Trustee, the Trust or the
Securityholders with respect to a breach of this Section 5.5, shall be to
require the Seller to repurchase the Receivable pursuant to this Section 5.5.
Upon receipt of the Purchase Amount, the Trustee shall release to the Seller or
its designee the related Receivable File and shall execute and deliver all
instruments of transfer or assignment, without recourse, as are prepared by the
Seller and delivered to the Trustee and are necessary to vest in the Seller or
such designee title to the Receivable.
5.6. Indemnification. (a) Subject to the limitation of remedies set
forth in Section 6.2 hereof with respect to a breach of any representations and
warranties contained in Section 3.2(b) hereof, the Seller shall indemnify the
Purchaser for any liability as a result of the failure of a Linc Receivable to
be originated in compliance with all requirements of law and for any breach of
any of its representations and warranties contained herein.
(b) The Seller shall defend, indemnify, and hold harmless the Purchaser
from and against any and all costs, expenses, losses, damages, claims, and
liabilities, arising out of or resulting from the use, ownership, or operation
by the Seller or any Affiliate thereof of a Financed Vehicle related to a Linc
Receivable.
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(c) The Seller shall defend, indemnify, and hold harmless the Purchaser
from and against any and all taxes, except for taxes on the net income of the
Purchaser, that may at any time be asserted against the Purchaser with respect
to the transactions contemplated herein, including, without limitation, any
sales, gross receipts, general corporation, tangible personal property,
privilege, or license taxes and costs and expenses in defending against the
same.
(d) The Seller shall defend, indemnify, and hold harmless the Purchaser
from and against any and all costs, expenses, losses, damages, claims and
liabilities to the extent that such cost, expense, loss, damage, claim or
liability arose out of, or was imposed upon the Purchaser through, the
negligence, willful misfeasance, or bad faith of the Seller in the performance
of its duties under the Agreements, or by reason of reckless disregard of the
Seller's obligations and duties under the Agreements.
Indemnification under this Section 5.6 shall include reasonable fees
and expenses of litigation and shall survive payment of the Notes and
Certificates. These indemnity obligations shall be in addition to any obligation
that the Seller may otherwise have.
5.7. Sale. The Seller agrees to treat this conveyance for all purposes
(including without limitation tax and financial accounting purposes) as a sale
on all relevant books, records, tax returns, financial statements and other
applicable documents.
5.8. Non-Petition. In the event of any breach of a representation and
warranty made by the Purchaser hereunder, the Seller covenants and agrees that
it will not take any action to pursue any remedy that it may have hereunder, in
law, in equity or otherwise, until a year and a day have passed since the date
on which all securities issued by the Trust or a similar trust formed by the
Purchaser have been paid in full. The Purchaser and the Seller agree that
damages will not be an adequate remedy for breach of this covenant and that this
covenant may be specifically enforced by the Purchaser or by the Trust.
ARTICLE VI
MISCELLANEOUS PROVISIONS
6.1. Obligations of Seller. The obligations of the Seller under the
Agreements shall not be affected by reason of any invalidity, illegality or
irregularity of any Linc Receivable.
6.2. Repurchase Events. The Seller hereby covenants and agrees with the
Purchaser for the benefit of the Purchaser, the Trustee, the Note Insurer and
the Securityholders, that (i) the occurrence of a breach of any of the Seller's
representations and warranties contained in Section 3.2(b) hereof (without
regard to any limitations regarding the Seller's knowledge) and (ii) the failure
of the Seller to timely comply with its obligations pursuant to Section 5.5
hereof, shall constitute events obligating the Seller to repurchase the
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affected Linc Receivables hereunder ("Repurchase Events"), at the Purchase
Amount from the Trust. Unless the breach of any of the Seller's representations
and warranties shall have been cured by the last day of the second Collection
Period following the discovery thereof by or notice to the Purchaser and the
Seller of such breach, the Seller shall repurchase any Linc Receivable if such
Linc Receivable is materially and adversely affected by the breach as of the
last day of such second Collection Period (or, at the Seller's option, the last
day of the first Collection Period following the discovery) and, in the event
that the breach relates to a characteristic of the Linc Receivables in the
aggregate, and if the Trust is materially and adversely affected by such breach,
unless the breach shall have been cured by such second Collection Period, the
Seller shall purchase such aggregate Principal Balance of Linc Receivables, such
that following such purchase such representation shall be true and correct with
respect to the remainder of the Linc Receivables in the aggregate. The
provisions of this Section 6.2 are intended to grant the Trustee a direct right
against the Seller to demand performance hereunder, and in connection therewith
the Seller waives any requirement of prior demand against the Purchaser and
waives any defaults it would have against the Purchaser with respect to such
repurchase obligation. Any such purchase shall take place in the manner
specified with respect to CPS in Section 4.7 of the Sale and Servicing
Agreement. The sole remedy hereunder of the Securityholders, the Trust, the Note
Insurer, the Trustee or the Purchaser against the Seller with respect to any
Repurchase Event shall be to enforce the Seller's obligation to repurchase such
Linc Receivables pursuant to this Agreement; provided, however, that the Seller
shall indemnify the Trustee, the Note Insurer, the Trust and the Noteholders
against all costs, expenses, losses, damages, claims and liabilities, including
reasonable fees and expenses of counsel, which may be asserted against or
incurred by any of them, as a result of third party claims arising out of the
events or facts giving rise to such breach. Upon receipt of the Purchase Amount,
the Purchaser shall cause the Trustee to release the related Receivables File to
the Seller and to execute and deliver all instruments of transfer or assignment,
without recourse, as are necessary to vest in the Seller title to the Linc
Receivable. Notwithstanding the foregoing, if it is determined that consummation
of the transactions contemplated by the Sale and Servicing Agreement and the
other transaction documents referenced in such Agreement, servicing and
operation of the Trust pursuant to such Agreement and such other documents, or
the ownership of a Security by a Holder constitutes a violation of the
prohibited transaction rules of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or the Internal Revenue Code of 1986, as amended
("Code") for which no statutory exception or administrative exemption applies,
such violation shall not be treated as a Repurchase Event.
6.3. Seller's Assignment of Purchased Receivables. With respect to all
Linc Receivables repurchased by the Seller pursuant to the Agreements, the
Purchaser shall assign, without recourse except as provided herein,
representation or warranty, to the Seller all the Purchaser's right, title and
interest in and to such Linc Receivables, and all security and documents
relating thereto.
6.4. Conveyance as Sale of Receivables Not Financing. The parties
hereto intend that the conveyances under the Agreements be a sale of the Linc
Receivables and the other
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Transferred Linc Property from the Seller to the Purchaser and not a financing
secured by such assets; and the beneficial interest in and title to the Linc
Receivables and the other Transferred Linc Property shall not be part of the
Seller's estate in the event of the filing of a bankruptcy petition by or
against the Seller under any bankruptcy law. In the event that any conveyance
hereunder is for any reason not considered a sale, the parties intend that this
Agreement constitute a security agreement under the UCC (as defined in the UCC
as in effect in the State of Connecticut) and applicable law, and the Seller
hereby grants to the Purchaser a first priority perfected security interest in,
to and under the Initial Linc Receivables and the other Initial Transferred Linc
Property being delivered to the Purchaser on the Closing Date, and other
property conveyed hereunder and all proceeds of any of the foregoing for the
purpose of securing payment and performance of the Securities and the repayment
of amounts owed to the Purchaser from the Seller. In the event that the
assignment of a Linc Receivable to the Purchaser is insufficient, without a
notation on the related Financed Vehicle's certificate of title, or without
fulfilling any additional administrative requirements under the laws of the
state in which the Financed Vehicle is located, to perfect a security interest
in the related Financed Vehicle in favor of the Purchaser, the Seller and
Purchaser hereby agree that the Seller's designation as the secured party on the
certificate of title is in its capacity as agent of the Purchaser and the
Purchaser's transferees.
6.5. Trust. The Seller acknowledges that the Purchaser will, pursuant
to the Sale and Servicing Agreement, sell the Receivables to the Trust and
assign its rights under this Purchase Agreement, the Samco Purchase Agreement
and the CPS Purchase Agreement to the Trustee for the benefit of the
Securityholders, and that the representations and warranties contained in this
Agreement and the rights of the Purchaser under this Purchase Agreement,
including under Sections 6.2 and 6.4 hereof are intended to benefit such Trust
and the Securityholders. The Seller also acknowledges that the Trustee on behalf
of the Securityholders as assignee of the Purchaser's rights hereunder may
directly enforce, without making any prior demand on the Purchaser, all the
rights of the Purchaser hereunder including the rights under Sections 6.2 and
6.4 hereof. The Seller hereby consents to such sale and assignment.
6.6. Amendment. This Agreement may be amended from time to time by a
written amendment duly executed and delivered by the Seller and the Purchaser
with the consent of the Note Insurer; provided, however, that any such amendment
that materially adversely affects the rights of the Noteholders under the Sale
and Servicing Agreement must be consented to by the holders of Notes
representing more than 50% of the outstanding principal amount of Notes.
6.7. Waivers. No failure or delay on the part of the Purchaser in
exercising any power, right or remedy under the Agreements shall operate as a
waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other or further exercise thereof or the exercise
of any other power, right or remedy.
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6.8. Notices. All communications and notices pursuant hereto to either
party shall be in writing or by telegraph or telex and addressed or delivered to
it at its address (or in case of telex, at its telex number at such address)
shown in the opening portion of this Agreement or at such other address as may
be designated by it by notice to the other party and, if mailed or sent by
telegraph or telex, shall be deemed given when mailed, communicated to the
telegraph office or transmitted by telex.
6.9. Costs and Expenses. The Seller will pay all expenses incident to
the performance of its obligations under this Purchase Agreement.
6.10. Representations of the Seller and the Purchaser. The respective
agreements, representations, warranties and other statements by the Seller and
the Purchaser set forth in or made pursuant to this Purchase Agreement shall
remain in full force and effect and will survive each closing hereunder.
6.11. Confidential Information. The Purchaser agrees that it will
neither use nor disclose to any Person the names and addresses of the Obligors,
except in connection with the enforcement of the Purchaser's rights hereunder,
under the Linc Receivables, under the Sale and Servicing Agreement or as
required by law.
6.12. Headings and Cross-References. The various headings in this
Purchase Agreement are included for convenience only and shall not affect the
meaning or interpretation of any provision of this Purchase Agreement.
References in this Purchase Agreement to Section names or numbers are to such
Sections of this Purchase Agreement.
6.13. Third Party Beneficiaries. The parties hereto hereby expressly
agree that each of the Trustee for the benefit of the Securityholders and the
Note Insurer shall be third party beneficiaries with respect to this Purchase
Agreement, provided, however, that no third party other than the Trustee for the
benefit of the Securityholders and the Note Insurer shall be deemed a third
party beneficiary of this Purchase Agreement.
6.14. Governing Law. THIS PURCHASE AGREEMENT AND THE ASSIGNMENTS SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE
OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
6.15. Counterparts. This Agreement may be executed in two or more
counterparts and by different parties on separate counterparts, each of which
shall be an original, but all of which together shall constitute one and the
same instrument.
[Rest of page intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereby have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
and year first above written.
CPS RECEIVABLES CORP.
By
Name:
Title:
LINC ACCEPTANCE COMPANY LLC
By:
Name:
Title:
-25-
Exhibit A
ASSIGNMENT
For value received, on this [ ] day of [ ], 1998, in accordance with
the Purchase Agreement dated as of [ ], 1998, between the undersigned (the
"Seller") and CPS Receivables Corp. (the "Purchaser") (the "Linc Purchase
Agreement"), the undersigned does hereby sell, transfer, assign and otherwise
convey unto the Purchaser, without recourse (subject to the obligations in the
Linc Purchase Agreement and the Sale and Servicing Agreement), all right, title
and interest of the Seller in and to (i) the Initial Linc Receivables listed in
the Schedule of Linc Receivables and all monies received thereunder after the
Cutoff Date and all Net Liquidation Proceeds received with respect to such
Initial Linc Receivables; (ii) the security interests in the Financed Vehicles
granted by Obligors pursuant to the Linc Receivables and any other interest of
the Seller in such Financed Vehicles, including, without limitation, the
certificates of title or, with respect to Financed Vehicles in the State of
Michigan, other evidence of ownership with respect to Financed Vehicles; (iii)
any proceeds from claims on any physical damage, credit life and credit accident
and health insurance policies or certificates relating to the Financed Vehicles
securing the Initial Linc Receivables or the Obligors thereunder; (iv) refunds
for the costs of extended service contracts with respect to Financed Vehicles
securing the Initial Linc Receivables, refunds of unearned premiums with respect
to credit life and credit accident and health insurance policies or certificates
covering an Obligor or Financed Vehicle securing the Initial Linc Receivables or
his or her obligations with respect to such a Financed Vehicle and any recourse
to Dealers for any of the foregoing; (v) the Receivable File related to each
Initial Linc Receivable; (vi) the proceeds of any and all of the foregoing and
(vii) all present and future claims, demands, causes and choses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of the
foregoing, including all proceeds of the conversion, voluntary or involuntary,
into cash or other liquid property, all cash proceeds, accounts, accounts
receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing. The foregoing sale does not constitute and is not intended
to result in any assumption by the Purchaser of any obligation of the
undersigned to the Obligors, insurers or any other Person in connection with the
Linc Receivables, the Receivable Files, any insurance policies or any agreement
or instrument relating to any of them.
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the Linc
Purchase Agreement and is to be governed by the Linc Purchase Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Linc Purchase Agreement.
THIS ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW
PRINCIPLES.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed as of the day and year first above written.
LINC ACCEPTANCE COMPANY LLC
By:
Name:
Title:
-2-
Exhibit B
Schedule of Linc Receivables
See Following Page
Exhibit C
FORM OF SUBSEQUENT PURCHASE AGREEMENT
THIS SUBSEQUENT PURCHASE AGREEMENT (this "Subsequent Purchase
Agreement") is made and entered into as of by and between LINC ACCEPTANCE
COMPANY LLC, a Delaware limited liability company (the "Seller"), and CPS
RECEIVABLES CORP., a California corporation (together with its successors and
assigns, the "Purchaser").
W I T N E S S E T H:
WHEREAS the Purchaser, as purchaser, has agreed to purchase from the
Seller, as seller, and the Seller, pursuant to the Purchase Agreement (the "Linc
Purchase Agreement") dated as of [ ], 1998, between the Purchaser and the
Seller, is transferring to the Purchaser the Subsequent Linc Receivables listed
on the Schedule of Subsequent Linc Receivables annexed hereto as Exhibit A (the
"Subsequent Linc Receivables") and related Subsequent Transferred Linc Property.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter contained, and for other good and valuable consideration,
the receipt of which is acknowledged, the Purchaser and the Seller, intending to
be legally bound, hereby agree as follows:
Definitions
SECTION 1. Capitalized terms used herein without definition shall have
the respective meanings assigned to such terms in the Linc Purchase Agreement.
SECTION 2. Conveyance of Subsequent Linc Receivables. For value
received, in accordance with the Linc Purchase Agreement, the Seller does hereby
sell, assign, transfer and otherwise convey unto the Purchaser, without recourse
(but without limitation of its obligations under the Linc Purchase Agreement),
all right, title and interest of the Seller in and to: (i) the Subsequent Linc
Receivables listed in the Schedule of Subsequent Linc Receivables annexed hereto
as Exhibit A and all monies received thereunder after [ ] (the "Subsequent
Cutoff Date") and all Net Liquidation Proceeds received with respect to such
Subsequent Linc Receivables; (ii) the security interests in the Financed
Vehicles granted by Obligors pursuant to the Subsequent Linc Receivables and any
other interest of the Seller in such Financed Vehicles, including, without
limitation, the certificates of title or, with respect to Financed Vehicles in
the State of Michigan, other evidence of ownership with respect to Financed
Vehicles; (iii) any proceeds from claims on any physical damage, credit life and
credit accident and health insurance policies or certificates relating to the
Financed Vehicles securing the Subsequent Linc Receivables or the Obligors
thereunder; (iv) refunds for the costs of extended service contracts with
respect to Financed Vehicles securing the
-2-
Subsequent Linc Receivables, refunds of unearned premiums with respect to credit
life and credit accident and health insurance policies or certificates covering
an Obligor or Financed Vehicle securing the Subsequent Linc Receivables or his
or her obligations with respect to such a Financed Vehicle and any recourse to
Dealers for any of the foregoing; (v) the Receivable File related to each
Subsequent Linc Receivable; (vi) the proceeds of any and all of the foregoing
and (vii) all present and future claims, demands, causes and choses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and nature whatsoever in respect of any or all of the
foregoing, including all proceeds of the conversion, voluntary or involuntary,
into cash or other liquid property, all cash proceeds, accounts, accounts
receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the "Subsequent Transferred Linc Property"
and together with any Subsequent Transferred CPS Property and/or any Subsequent
Transferred Samco Property, the "Subsequent Transferred Property").
SECTION 3. Consideration for Subsequent Transferred Property. In
consideration for the Subsequent Linc Receivables and other Subsequent
Transferred Linc Property, subject to the terms and conditions hereof, the
purchase price for the Subsequent Linc Receivables, in the amount of $_________,
shall be paid by the Purchaser in cash to the Seller on the Subsequent Closing
Date.
SECTION 4. Conveyance as Sale of Receivables Not Financing. The parties
hereto intend that the conveyance hereunder be a sale of the Subsequent Linc
Receivables and the related Transferred Linc Property from the Seller to the
Purchaser and not a financing secured by such assets; and the beneficial
interest in and title to the Subsequent Linc Receivables and the related
Transferred Linc Property shall not be part of the Seller's estate in the event
of the filing of a bankruptcy petition by or against the Seller under any
bankruptcy law. In the event that any conveyance hereunder is for any reason not
considered a sale, the parties intend that this Agreement constitute a security
agreement under the UCC (as defined in the UCC as in effect in the State of
____________) and applicable law, and the Seller hereby grants to the Purchaser
a first priority perfected security interest in, to and under the Subsequent
Linc Receivables and the related Transferred Linc Property being delivered to
the Purchaser on the Subsequent Closing Date, and other property conveyed
hereunder and all proceeds of any of the foregoing for the purpose of securing
payment and performance of the Securities and the repayment of amounts owed to
the Purchaser from the Seller.
SECTION 5. Representations and Warranties of the Seller. This Agreement
is made pursuant to and upon the representations, warranties, covenants and
agreements on the part of the Seller contained in the Linc Purchase Agreement
and is to be governed by the Linc Purchase Agreement. All of such
representations, warranties, covenants and agreements are
-3-
hereby incorporated herein and are in full force and effect as though
specifically set forth herein.
SECTION 6. Representations and Warranties of the Purchaser. This
Agreement is made pursuant to and upon the representations, warranties,
covenants and agreements on the part of the Purchaser contained in the Linc
Purchase Agreement and is to be governed by the Linc Purchase Agreement. All of
such representations, warranties, covenants and agreements are hereby
incorporated herein and are in full force and effect as though specifically set
forth herein.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed this __ day of _________, but effective as of the date and year
first written above.
LINC ACCEPTANCE COMPANY LLC,
as Seller
By:
Name:
Title:
CPS RECEIVABLES CORP.,
as Purchaser
By:
Name:
Title:
-4-
EXHIBIT A TO SUBSEQUENT PURCHASE AGREEMENT
FORM OF SUBSEQUENT ASSIGNMENT
For value received, in accordance with the Purchase Agreement dated as
of [ ], 1998, as heretofore amended, supplemented or otherwise modified (the
"Linc Purchase Agreement"), among the undersigned, as Seller, and CPS
Receivables Corp. (the "Purchaser"), the undersigned does hereby transfer,
assign, grant, set over and otherwise convey to the Purchaser, without recourse
(subject to the obligations in the Linc Purchase Agreement and the Sale and
Servicing Agreement) all right, title and interest of the Seller in and to: (i)
the Subsequent Linc Receivables listed in the Schedule of Subsequent Linc
Receivables annexed hereto as Exhibit A and all monies received thereunder after
[ ] (the "Subsequent Cutoff Date") and all Liquidation Proceeds and Recoveries
received with respect to such Subsequent Linc Receivables; (ii) the security
interests in the Financed Vehicles granted by Obligors pursuant to the
Subsequent Linc Receivables and any other interest of the Seller in such
Financed Vehicles, including, without limitation, the certificates of title or,
with respect to Financed Vehicles in the State of Michigan, other evidence of
ownership with respect to Financed Vehicles; (iii) any proceeds from claims on
any physical damage, credit life and credit accident and health insurance
policies or certificates relating to the Financed Vehicles securing the
Subsequent Linc Receivables or the Obligors thereunder; (iv) refunds for the
costs of extended service contracts with respect to Financed Vehicles securing
the Subsequent Linc Receivables, refunds of unearned premiums with respect to
credit life and credit accident and health insurance policies or certificates
covering an Obligor or Financed Vehicle securing the Subsequent Linc Receivables
or his or her obligations with respect to such a Financed Vehicle and any
recourse to Dealers for any of the foregoing; (v) the Receivable File related to
each Subsequent Linc Receivable; (vi) the proceeds of any and all of the
foregoing and (vii) all present and future claims, demands, causes and choses in
action in respect of any or all of the foregoing and all payments on or under
and all proceeds of every kind and nature whatsoever in respect of any or all of
the foregoing, including all proceeds of the conversion, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit
accounts, insurance proceeds, condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables, instruments and other
property which at any time constitute all or part of or are included in the
proceeds of any of the foregoing (collectively, the "Subsequent Transferred Linc
Property" and together with any Subsequent Transferred CPS Property and/or
Subsequent Transferred Samco Property, the "Subsequent Transferred Property").
The foregoing assignment, transfer and conveyance does not constitute
and is not intended to result in any assumption by the Purchaser of any
obligation of the undersigned to the Obligors, insurers or any other person in
connection with the Subsequent Linc Receivables, the Receivable Files, any
insurance policies or any agreement or instrument relating to any of them.
-5-
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of each of the undersigned contained in
the Linc Purchase Agreement and is to be governed by the Linc Purchase
Agreement.
Capitalized terms used herein and not otherwise defined shall have the
meanings assigned to them in the Linc Purchase Agreement.
This Assignment shall be governed by and construed in accordance with
the internal laws of the State of New York, without regard to principles of
conflicts of law.
IN WITNESS WHEREOF, the undersigned have caused this Assignment to be
duly executed as of __________.
LINC ACCEPTANCE COMPANY LLC
By:
Name:
Title:
-6-
