EXHIBIT 10.37
AGREEMENT IN RESPECT OF
TERMINATION OF LOAN PURCHASE
AND SERVICING AGREEMENT
This Agreement in Respect of Termination of Loan Purchase and Servicing
Agreement ("Agreement") is entered into effective as of this 30th of April,
2003, by and between Bank One, N.A., national banking association with its main
office in Columbus, Ohio ("Bank One") and First Consumer Credit, Inc. ("FCC"), a
Texas corporation as assignee of First Consumer Credit, L.L.C. (collectively the
"Parties").
-RECITALS-
WHEREAS, the parties entered into a Loan Purchase and Servicing
Agreement dated effective as July 31, 2001, as amended from time to time (the
"Loan Purchase Agreement");
WHEREAS, prior to entering into the Loan Purchase Agreement, the parties
entered into a Home Improvement Contract Purchase Agreement dated as of October
29, 1997, a Loan Purchase and Servicing Agreement dated as of May 11, 2000, a
Loan Purchase and Servicing Agreement dated as of July 22, 1999, a Loan Purchase
and Servicing Agreement dated as of December 19, 1996 and various other
contracts and agreements (the term "Loan Purchase Agreement" defined hereinabove
shall be deemed to include each of the foregoing agreements, as amended from
time to time);
WHEREAS, Xxxxx X. Xxxxxxxx ("Borschow") and Bank One entered into a
Service Maintenance Agreement dated as of May 11, 2000, as amended on August 1,
2001 (the term "Loan Purchase Agreement" as defined hereinabove shall be deemed
to include said Service Maintenance Agreement);
WHEREAS, in contemplation of the Loan Purchase Agreement, Bank One and
FCC entered into a Standby Servicing Agreement with Compu-Link Loan Service,
Inc. dated as of September 14, 2000, as amended August 2, 2001 (the term "Loan
Purchase Agreement" as defined hereinabove shall be deemed to include the
Standby Servicing Agreement);
WHEREAS, the Parties desire to terminate the Loan Purchase Agreement and
for FCC to purchase the loans listed on Exhibit A (the "Loan Portfolio") and to
provide to each other a mutual release;
IT IS HEREBY AGREED as follows:
(1) The Loan Purchase Agreement is hereby terminated.
(2) Bank One agrees to sell and FCC agrees to purchase the Loan
Portfolio with such purchase and sale to be effective upon the
receipt by Bank One of the Total Purchase Price in certified
funds on or before May 31, 2003 (the "Closing Date"). The
Closing Date may be extended by mutual written consent o the
Parties. The principal portion of the Purchase Price shall be
the sum of:
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(a) current and not impaired loans: 1.0575 times the then
current (the term "then current" for purposes of this
Agreement shall mean through the date proceeding the
Closing Date) outstanding principal balance; plus
(b) current but impaired loans: 0.75 times the then current
outstanding principal balance; plus
(c) greater than thirty (30) days: 0.00 times the then
current outstanding principal balance; plus
(d) charge-offs: 0.00 times the then current outstanding
principal balance.
For example, if the purchase was effective as of March 24, 2003
on which date the principal balances on the loans are as set
forth in Exhibit "B", the principal portion of the Purchase
Price would be $27,993,134.14. This amount is arrived at by
multiplying 1.0575 X (line 1 - line 2 - line 5 - line 7) +
multiplying 0.75 X (line 5 + line 7). Charged off accounts are
not shown on Exhibit "B". To arrive at the Total Purchase Price,
in addition to the foregoing principal payment, all outstanding
accrued interest on the current loans and on the current and
impaired loans, shall be paid on a dollar for dollar basis
through the date of payment.
(3) All payments of principal and interest received through Closing
Date shall be for the account of Bank One.
(4) In addition to the foregoing, FCC agrees to reimburse Bank One
at the rate of $1.10 per dollar for those loans purchased since
December 31, 2002 which Bank One put back as declines as
reflected on Exhibit "C".
(5) Bank One agrees to release the funds in the Bank One Reserve
Account No. 000001575106529 in the approximate amount of
$33,000.00.
(6) FCC agrees to waive the service fees for the month of April in
the approximate amount of $34,000.00, and if such fees have been
paid by Bank One, FCC will reimburse Bank One for said sums.
(7) The Parties agree to prorate the servicing fees for the month of
May based upon the number of elapsed days in the month of May
divided by 30. FCC will continue, should Bank One so request, to
service loan files not purchased hereunder, pursuant to a new
servicing agreement on the same terms and conditions currently
in effect between the parties.
(8) Bank One and FCC do, hereby waive and renounce completely any
and all claims and/or causes of actions each has, possesses
and/or presently could assert against the other and/or any and
all of the other's predecessors, affiliates, parents, employees,
officers, directors, shareholders, attorneys, agents, and
insurers (collectively the "Released Parties"), by reason of any
transactions, matters, statements, causes or acts done, known or
unknown, arising directly or indirectly, out of the Loan
Purchase Agreement. Bank One and Xxxxx X. Xxxxxxxx do hereby
waive and renounce completely any and all claims and/or causes
of actions each has, possesses and/or presently could assert
against the other and/or any and
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all of the other's predecessors, affiliates, parents, employees,
officers, directors, shareholders, attorneys, agents, and
insurers (collectively the "Released Parties"), by reason of any
transactions, matters, statements, causes or acts done, known or
unknown, arising directly or indirectly, out of the Loan
Purchase Agreement. The parties expressly agree that this
Agreement and the release herein provided is intended to be as
broad and inclusive as possible under the laws of the State of
Ohio and that should any portion thereof be held invalid, the
balance shall continue in full legal force and effect.
(9) Entire Agreement. The Parties acknowledge that this writing is
their entire agreement and that no promises or covenants not set
forth or referred to herein have been relied upon by them in
entering into this Agreement. This Agreement cannot be modified
unless such modification shall be made in writing and signed by
the Parties to be bound thereto. This Agreement shall be
construed without regard to any presumption or any other rule
requiring construction against the Party who caused it to have
been drafted. Faxed executed copies and counterparts to this
Agreement shall be considered as originals. Any Party breaching
this Agreement shall be liable for court costs and attorneys
fees. Each individual signing this Agreement represents and
warrants it does so with the full authority of the entity it is
signing on behalf of.
(10) Bank One agrees, promptly upon execution of this Agreement by
the Parties, to deliver all loan files to Bank One's custodian
(U.S. Bank Corporate Trust Services, 000 Xxxx Xxxxx Xxxxxx, Xx.
Xxxx, Xxxxxxxxx 00000 Phone: 000-000-0000 Fax: 000-000-0000) for
loan file document inspection and review, which shall be
completed not later than six (6) business days following receipt
of such files. FCC shall pay all fees of U.S. Bank.
(11) Notwithstanding anything to the contrary contained herein,
closing of the transactions contemplated in this Agreement shall
not take place until FCC is satisfied, in its reasonable
discretion, as to the document sufficiency of the loan files,
provided, however, that in no event shall Bank One be obligated
to deliver to FCC more documentation than was originally
delivered to Bank One by FCC.
(12) FCC shall not be obligated to purchase any loan files which it
deems, in its reasonable discretion, to be insufficient as to
documentation. Exhibit "D" sets forth the minimum required
documents which must be present in each loan file. In the event
that more than five percent (5.0%) of the Loan Portfolio is
deemed to be ineligible for purchase by FCC due to documentation
sufficiency, then, FCC may, by written notice to Bank One within
three (3) business days of the completion of the U.S. Bank
document inspection and review:
(a) terminate this Agreement and purchase none of the Loan
Portfolio and reinstate the Loan Purchase Agreement; or,
(b) purchase that portion of the Loan Portfolio which is
sufficiently documented, in which case this Agreement
remains in full force and effect and the Loan Purchase
Agreement shall remain terminated.
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(13) Notwithstanding the foregoing, however, for any loan file
rejected by FCC due to insufficient documentation, Bank One
shall have the option, but not the requirement, to remedy the
documentation insufficiencies within 10 days of FCC's written
notice described immediately above. Bank One may then present
such remedied loan files to FCC, and FCC shall purchase any such
remedied loan files under the same terms and conditions of
purchase set forth in this Agreement.
BANK ONE, N.A.
By: /s/ Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxxxxx
FIRST CONSUMER CREDIT, INC.
By: /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx
/s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx, Personally
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