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EXHIBIT 10.9
REVOLVING LINE OF CREDIT AGREEMENT
THIS REVOLVING LINE OF CREDIT AGREEMENT (this "Agreement") is entered into
as of the 15th day of June, 1999, by and between WFS FINANCIAL INC, a California
corporation (the "Borrower") and WESTERN FINANCIAL BANK, a federal savings bank
(the "Bank"), with reference to the following:
PREAMBLE
A. The Borrower and the Bank are currently parties to a Revolving Line of
Credit Agreement entered into on May 1, 1995 ("Line of Credit") in conjunction
with the transfer to Borrower of certain assets of the Bank.
B. The Line of Credit was established in favor of the Borrower in an amount
not to exceed $400,000,000, on the terms and conditions set forth therein, and
was subsequently amended on October 1, 1997 and on September 18, 1998, to, among
other things, increase the maximum amount to $900,000,000 and provide an
interest rate tiered to the outstanding balance.
C. The Borrower and the Bank wish to enter into a new Agreement to replace
the existing agreement in order to, among other things, increase the maximum
amount of the Agreement and to change the base rate index and the interest
spread.
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained herein, and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto hereby covenant and agree as follows:
TERMS
1. CERTAIN DEFINITIONS.
Unless (i) elsewhere defined herein, each capitalized term used in this
Agreement shall have the following meanings, and (ii) the context otherwise
requires, any of the following capitalized terms may be used in the singular or
the plural, depending on the reference:
"ADVANCES" shall mean the principal amount of all sums which the Bank lends
to the Borrower pursuant to this Agreement. For the avoidance of doubt,
$876.038,645.32 of which is the outstanding balance owed under the Line of
Credit shall constitute an Advance hereunder with a corresponding Drawdown
Date of June 15, 1999
"BASE RATE" shall mean the one-month London InterBank Offering Rate
("LIBOR") as provided by the Bank on the repricing date.
"BORROWING CERTIFICATE" shall mean a borrowing request executed by the
Borrower in substantially the form attached hereto as Exhibit A or such
other form as may be acceptable to the Bank in its sole and absolute
discretion.
"BUSINESS DAY" shall mean a day when banks are not authorized or required
to close in the State of California.
"CODE" shall mean the Uniform Commercial Code in effect from time to time
in the relevant State or States.
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"COLLATERAL" shall mean any and all assets and properties, if any, pledged
from time to time by the Borrower to the Bank pursuant to any Loan
Documents to secure all or a portion of the Obligations.
"CORE CAPITAL TO ADJUSTED TOTAL ASSETS RATIO" shall mean the ratio of "core
capital" to "adjusted total assets" (as such terms are defined in the
regulations of the Office of Thrift Supervision).
"COSTS" shall mean, collectively, all sums (other than Principal and
Interest) payable by the Borrower pursuant to this Agreement including,
without limitation, all sums payable pursuant to Sections 8 and 10.6
hereof.
"ENCUMBRANCES" shall mean security interests, mortgages, pledges, equities,
encumbrances, conditional sales or other title retention agreements, leases
(excluding only operating leases for office equipment and real property),
rights, restrictions, reservations or charges or liens of any nature,
collectively.
"GAAP" shall mean generally accepted accounting principles consistently
applied.
"INTEREST" shall mean all interest amounts required to be paid by the
Borrower pursuant to this Agreement.
"INTEREST SPREAD" shall mean (i) seven-eighths percent (.875) with respect
to any Obligations not secured by Collateral acceptable to the Bank in its
sole discretion, and (ii) three-eighths of one percent (.375) with respect
to any Obligations secured by Collateral acceptable to the Bank in its sole
discretion.
"LOAN" shall mean the aggregate amount of all outstanding Advances.
"LOAN DOCUMENTS" shall mean, collectively, this Agreement, all Borrowing
Certificates, security agreements, UCC financing statements, and any other
certificates, documents or agreements of any type or nature heretofore or
hereafter executed and/or delivered by or on behalf of the Borrower to the
Bank in furtherance of this Agreement or evidencing and/or securing any of
the Obligations.
"MODIFICATIONS" shall mean amendments, alterations, supplements,
replacements, modifications or terminations, collectively.
"MODIFY" shall mean amend, alter, supplement, replace, modify or terminate,
collectively.
"OBLIGATIONS" shall mean, collectively, the Principal, together with
accrued Interest and Costs.
"PERSON" shall mean an individual or a corporation, association, limited
liability company, joint venture, partnership, trust or other private or
governmental entity.
"PRINCIPAL" shall mean the aggregate of the Advances (including, without
limitation, the Initial Advance) that are advanced to or for the account of
the Borrower and that remains unpaid.
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"RATE OF INTEREST" shall mean with respect to each Obligation, the Base
Rate plus the then applicable Interest Spread with respect to the
Obligation in question.
"STATE" shall mean any state of the United States.
"UNITED STATES" AND U.S." shall mean the United States of America and its
territories and possessions.
2. THE LOAN.
2.1 COMMITMENT AND AVAILABILITY PERIOD.
2.1.1 COMMITMENT. On the terms and subject to the satisfaction of the
conditions set forth in this Agreement and in reliance upon the
representations and warranties of the Borrower set forth in the Loan
Documents, the Bank agrees to lend to the Borrower, in the form of Advances
by way of a revolving line of credit (the "Facility") in an aggregate sum
owing hereunder at any one time of up to $1,300,000,000 (the "Commitment")
from time to time during the "Availability Period" (as defined herein).
Subject to the terms and conditions of this Agreement, the Borrower may
borrow, repay and reborrow amounts constituting the Commitment.
2.1.2 Availability Period. As used in this Agreement, the term
"Availability Period" shall mean the period commencing as of the date of
this Agreement and ending on December 31, 2004; provided, however, that the
Availability Period may be extended at the election of the Borrower for a
period not to exceed sixty (60) months; provided, further, that the
Borrower shall not have the right to so extend the Availability Period if
(i) the then Core Capital to Adjusted Total Assets Ratio of the Borrower is
less than 4%, or (ii) the extension would be illegal or contrary to any
governmental law, rule, regulation or order applicable to the Bank or the
Borrower.
2.2 NOTICE AND MAKING OF ADVANCES. Whenever the Borrower desires to draw
down an Advance, the Borrower shall execute and deliver to the Bank a Borrowing
Certificate prior to each requested Advance, and such Borrowing Certificate
shall be irrevocable. Such Borrowing Certificate, to be effective, must be
received by the Bank not later than 9:00 a.m., Los Angeles time, on the Business
Day immediately preceding the requested Drawdown Date set forth in the Borrowing
Certificate. Notwithstanding the foregoing, the Borrower hereby irrevocably
authorizes the Bank, on behalf of the Borrower, to retain from time to time any
Advance or portion thereof to be used to pay any outstanding Interest or Costs
hereunder.
2.3 CURRENCY OF ADVANCES. Each Advance shall be made in United States
dollars.
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2.4 COMPUTATION AND PAYMENT OF INTEREST.
2.4.1 ACCRUAL OF INTEREST. Interest shall accrue on (i) each Advance
commencing on the applicable Drawdown Date, (ii) all arrears of Interest
not paid when due, commencing on the next day following the applicable due
date, and (iii) all Costs not paid on or before the applicable due date,
commencing on the next day following the applicable due date; in each case
until repaid in full at the Rate of Interest. With respect to all such
Obligations secured by Collateral acceptable to the Bank, Interest shall be
calculated based upon the average amount of such secured Obligations
outstanding during the month in question, and Interest shall be calculated
on all other unsecured Obligations based upon the average amount of such
unsecured Obligations outstanding during the month in question.
Furthermore, Interest shall be calculated on the number of calendar days
actually elapsed on the basis of a year of 365 days and shall be paid as
stipulated in this Section 2.4, and each change in the Rate of Interest
resulting from a change in the Base Rate or the Interest Spread shall be
effective from the date of the respective change in any such rates.
2.4.2 PAYMENTS OF INTEREST. Interest shall be due and payable (i) on
the fifth calendar day of each month (or if such day is not a Business Day,
on the next Business Day thereafter) for the preceding month, and (ii) at
maturity (by acceleration or otherwise). In the event that the Borrower
fails to pay Interest when due, the Bank may, in its sole discretion,
advance such amount for the Borrower's account, which amount shall be
deemed an Advance hereunder.
2.5 REPAYMENT OF THE LOAN.
2.5.1 FINAL REPAYMENT DATE. Subject to the prepayment provisions set forth
in Section 2.5.2 hereof, all outstanding Advances shall be due and payable
without notice, and the Borrower shall pay all such Advances to the Bank on or
before the Final Repayment Date. As used herein, the term "Final Repayment Date"
shall mean the last day of the Availability Period including any extensions
thereof pursuant to Section 2.1.2 hereof.
2.5.2 MANDATORY PREPAYMENTS.
2.5.2.1 LOAN EXCEEDS THE COMMITMENT. In the event the aggregate
outstanding amount of the Loan at any time exceeds the Commitment, the Loan
shall be immediately due and payable without notice to the extent of such
excess (together with accrued Interest thereon), and the Borrower shall
immediately pay such excess amount to the Bank.
2.5.2.2 AUTOMATIC PREPAYMENT OF ALL OBLIGATIONS. All Obligations shall
be due and payable without notice or demand, and the Borrower shall pay all
such Obligations to the Bank upon the earliest to occur of any Event of
Default specified in Sections 6.5 or 6.6 hereof.
2.5.2.3 UPON DEMAND. At the election of the Bank, upon demand, all
outstanding Obligations shall be due and payable upon the occurrence of an
Event of Default (other than any Event of Default described in Sections 6.5
or 6.6, for which no notice is necessary), and the Borrower shall pay all
such Obligations to the Bank.
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2.5.3 OPTIONAL PREPAYMENTS. The Borrower may, upon at least two (2)
Business Days' prior written notice to the Bank, prepay any outstanding
Principal, either in whole or in part. All such prepayments shall be
accompanied by the payment of any accrued Interest on the amount of the
outstanding Principal prepaid.
2.6 TIME AND PLACE OF PAYMENTS. The Borrower shall make each payment
hereunder at the office of the Bank set forth in, or designated by the Bank
pursuant to, Section 9 hereof, on the day when due, in freely transferable
Dollars representing "same day" funds. Whenever any payment to be made hereunder
or under any instrument delivered hereunder shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day; and such extension of time shall in each such case be excluded in
the computation and payment of Interest.
2.7 APPLICATION OF PAYMENTS. Subject to Section 7.4 hereof, all payments
made hereunder in respect of any of the Obligations (whether optional or
mandatory) shall be credited first to Costs to the extent that Costs have not
previously been paid, then to Interest to the extent that Interest is accrued
and unpaid, and then to outstanding Principal.
2.8 NO OFFSET BY THE BORROWER; NET PAYMENTS. All payments by the Borrower
under this Agreement shall be made without setoff or counterclaim and in such
amounts as may be necessary in order that all such payments (after deduction or
withholding for or on account of any present or future taxes of any kind,
imposts, levies, assessments, duties, fees, deductions or other charges,
restrictions, conditions of whatever nature now or hereafter imposed, levied,
collected or asserted to be due or payable) shall not be less than the amounts
otherwise specified to be paid under this Agreement.
3. REPRESENTATIONS AND WARRANTIES.
3.1 The Borrower hereby represents and warrants to the Bank, as of the date
hereof and as of each Drawdown Date (except to the extent that any such
representation or warranty expressly relates to an earlier date), that:
3.1.1 GOOD STANDING AND CORPORATE POWER. The Borrower is a corporation
duly organized, validly existing and in good standing under the laws of the
state of California, and is qualified to transact business as a foreign
corporation in good standing in each other jurisdiction where the failure
to be so qualified would have a material adverse effect on it, its assets
or properties, or the conduct of its business. The Borrower has the right,
power and authority to own its properties and assets and to transact the
business in which it is engaged and proposes to engage.
3.1.2 BINDING AGREEMENT. This Agreement and the other Loan Documents
(to the extent such other Loan Documents are intended to be of a
contractual nature), when executed and delivered, will constitute the valid
and legally binding obligations of the Borrower and are enforceable in
accordance with their respective terms.
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3.1.3 DUE AUTHORIZATION; NO CONFLICTS OR VIOLATIONS. The execution,
delivery and performance of this Agreement and the other Loan Documents by
the Borrower, the borrowings hereunder, and any grant of security interests
under any Loan Documents, (i) have been duly authorized by all requisite
corporate action of the Borrower and will not violate any provision of any
law, any order of any court or other agency of the United States, any State
or any foreign country, state or province having jurisdiction, and (ii)
will not violate any provision of the articles of incorporation, or by-laws
of the Borrower, or any provision of any material agreement or instrument
to which the Borrower is a party or by which the Borrower or any of its
properties or assets may be bound, or be in conflict with, result in a
breach of or constitute a default under, any such agreement or other
instrument, or result in the creation or imposition of any Encumbrance
(other than Encumbrances approved by the Bank in its sole discretion) of
any nature whatsoever upon the Collateral.
3.1.4 AUTHORIZATIONS. All authorizations, approvals, registrations or
filings from or with (i) any governmental or public regulatory body or
authority of the United States, any State or of any foreign country, state,
province or other jurisdiction, or (ii) any other Person, required for the
execution, delivery or performance by the Borrower of the Loan Documents to
which the Borrower is a party, have been obtained or made and are in full
force and effect.
3.2 NO MISREPRESENTATIONS. No representation or warranty of the Borrower
made in any Loan Documents, and none of such documents themselves contain, or
will contain, a misstatement by or on behalf of the Borrower of a material fact
or omits, or will omit to state a material fact required to be stated herein or
therein in order to make the statements contained herein or therein, in light of
the circumstances under which they were made, not misleading in any respect.
3.3 MAKING OF AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties of the Borrower made in the Loan Documents shall
survive the execution and delivery of this Agreement and the making of any
Advance.
4. CONDITIONS PRECEDENT TO ADVANCES.
The obligation of the Bank to make any Advance is subject to the Borrower's
full compliance with each of the following conditions precedent to the
satisfaction of the Bank in its sole and absolute discretion, unless otherwise
waived in writing by the Bank in its sole and absolute discretion:
4.1 COMPLIANCE. At the time of the making of the requested Advance (i) the
Borrower shall have complied and then be in compliance with all terms, covenants
and conditions of this Agreement; (ii) there shall exist no Event of Default,
and no such event will result from such requested Advance, and (iii) each of the
material representations and warranties made by the Borrower in any of the Loan
Documents shall be true and correct on and as of such date with the effect as
though such representations and warranties had been made on and as of such date.
4.2 BORROWING CERTIFICATE. The Borrower shall have timely delivered to the
Bank, in accordance with Section 2.2 hereof, a Borrowing Certificate duly
completed and executed by the Borrower.
4.3 PAYMENT OF CERTAIN OBLIGATIONS. The Borrower shall have paid to the
Bank all Interest and Costs payable to and/or incurred by the Bank through the
Drawdown Date.
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4.4 ADDITIONAL DOCUMENTS. The Bank shall have received such additional
documents, agreements and certificates as the Bank may request in its sole and
absolute discretion.
4.5 PROPOSED USE. The Bank shall have determined in its sole and absolute
discretion that the requested Advance will not be used by the Borrower for any
purpose not permitted by Section 5.1 hereof.
5. ADDITIONAL COVENANTS.
The Borrower hereby covenants to and agrees with the Bank that, until
payment in full of all of the Obligations and until such time as the Bank is no
longer obligated to lend any funds under this Agreement, the Borrower will
(unless otherwise waived in writing by the Bank):
5.1 PERMITTED USE OF PROCEEDS. Use the proceeds of the Advances to only
finance the Borrower's general working capital needs (including, without
limitation, the payment of Interest and Costs owing from time to time hereunder,
the purchasing of retail installment sales contracts from new and used auto
dealers, and the funding of loans made directly to consumers).
5.2 EXISTENCE. Do or cause to be done all things necessary to comply with
all laws and regulations applicable to the Borrower, and to preserve, renew and
keep in full force and effect (i) the corporate existence of the Borrower in its
place of incorporation and in all other jurisdictions where the Borrower
conducts business, and (ii) all rights, licenses, permits and franchises of the
Borrower.
5.3 PERFORMANCE COVENANTS.
5.3.1 Duly and timely comply with all the terms, conditions, covenants
and warranties set forth in the Loan Documents, all at the times and places
and in the manner set forth herein and therein, and diligently protect the
rights of the Bank under such agreements where the failure to protect such
rights would have a material adverse effect on the Bank's interests
therein;
5.3.2 At all times maintain or cause to be maintained in favor of the
Bank the security interests provided for under or pursuant to the Loan
Documents as valid security interests in the Collateral subject only to
such Encumbrances as may be consented to by the Bank in its sole
discretion; and
5.3.3 Diligently and timely defend the Collateral and the Bank's
rights therein against any and all Encumbrances (other than such
Encumbrances).
5.4 NOTICE OF CERTAIN EVENTS. Promptly give notice in writing to the Bank
of (i) the occurrence of any Event of Default; or (ii) any action or event of
which any Borrower has knowledge which might materially and adversely affect the
condition (whether financial or otherwise) of the Borrower and/or the
performance by the Borrower of any of its obligations under any Loan Document or
the security interests granted under any Loan Document.
5.5 FURTHER ASSURANCES. At the Borrower's sole cost and expense, duly
execute and deliver, or cause to be duly executed and delivered to the Bank such
further agreements, documents, instruments and information and do or cause to be
done such further acts as may be necessary or proper to evidence and/or perfect
the security interests of the Bank in the Collateral
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or to otherwise carry out more effectively the provisions and purposes of the
Loan Documents as the Bank may from time to time request.
5.6 COMPLIANCE WITH LAWS. At all times comply with the requirements of all
applicable laws, rules, regulations and orders of all governmental authorities
of the United States, the States, foreign countries, states, provinces thereof
and their respective counties, municipalities and other subdivisions and of any
other jurisdictions (whether domestic or foreign) applicable to the Borrower.
5.7 DISCHARGE OF LIABILITIES. That all costs, expenses, obligations and
liabilities of the Borrower shall be discharged as and when they fall due except
any such items being diligently contested in good faith for which appropriate
reserves and provisions as required by GAAP have been made, so long as by reason
of such non-payment and contest no material item or portion of the assets of the
Borrower is in jeopardy of being seized, levied upon or forfeited.
6. EVENTS OF DEFAULT.
An "Event of Default" shall mean the occurrence of any of the following
events:
6.1 A default in the payment when due and in the manner prescribed herein
of any installment of Principal or Interest and such default shall not be cured
within seven (7) Business Days after the Bank has given written notice to the
Borrower of such default.
6.2 The failure, refusal or neglect of the Borrower to observe or perform
for any reason any of the material covenants, conditions, agreements or
provisions contained in any Loan Document (other than the payment of any
Obligation of which the failure to pay constitutes an Event of Default described
in Section 6.1 hereof) or to execute and deliver any documents, agreements or
instruments requested by the Bank hereunder or thereunder, and such failure,
refusal or neglect shall not be cured within forty-five (45) days after the Bank
has given written notice to the Borrower of such failure, refusal or neglect.
6.3 Any material representation or warranty made by the Borrower in any
Loan Document shall prove to have been false or misleading in any material
respect.
6.4 The Bank shall cease to have valid security interests (subject only to
Encumbrances consented to in writing by the Bank) at any time for any reason in
the Collateral or any portion thereof (other than due to a release by the Bank
of any such security interests).
6.5 The Borrower shall be dissolved or shall sustain the loss, cancellation
or forfeiture of its legal status or good standing by reason of any judicial,
extra-judicial or administrative proceedings or otherwise, or shall (i) apply
for or consent to the appointment of a receiver, trustee or liquidator of the
Borrower or of all or a substantial part of the Borrower's assets; (ii) be
unable to, or admit in writing its inability to, pay its debts as they mature;
(iii) make a general assignment for the benefit of creditors; (iv) be
adjudicated a bankrupt or insolvent; (v) file a voluntary petition in bankruptcy
or a petition or an answer seeking reorganization or an arrangement for the
benefit of creditors or take advantage of any insolvency law in its capacity as
a debtor; (vi) interpose an answer admitting the material allegations of the
petition filed against the Borrower in any bankruptcy, reorganization or
insolvency proceedings; (vii) take any action which would have the effect of
dissolving the Borrower; or (viii) take any action for the purpose of effecting
any of the foregoing.
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6.6 Any (i) involuntary petition is filed against the Borrower seeking to
subject it to any bankruptcy, insolvency or similar laws and such petition shall
remain unstayed or not be withdrawn for a period of forty-five (45) days; or
(ii) order, judgment or decree shall be entered against the Borrower by any
court of competent jurisdiction approving a petition seeking its reorganization
or appointment of a receiver, trustee or liquidator of the Borrower or of all or
a substantial part of its assets and such order, judgment or decree shall
continue and stay in effect for a period of forty-five (45) days.
7. REMEDIES; APPLICATION OF PROCEEDS.
7.1 The Bank may, upon the occurrence of an Event of Default, exercise any
one or more of the following rights and remedies:
7.1.1 If the Commitment or any portion thereof has not yet been
advanced, declare the obligations of the Bank to honor the Commitment
immediately terminated, whereupon the obligation of the Bank to make
Advances shall terminate immediately;
7.1.2 Declare all Obligations to be forthwith due and payable,
whereupon all such Obligations shall be accelerated and shall become
immediately due and payable without presentation, demand or notice of any
kind to the Borrower (all of which are hereby waived by the Borrower),
except that if an Event of Default specified in Sections 6.5 or 6.6 shall
occur such acceleration shall be automatic and no declaration or other act
of the Bank shall be necessary to effect such acceleration;
7.1.3 Proceed to protect and enforce the rights of the Bank to payment
of the Obligations and its rights to proceed against the Collateral
(including, without limitation, exercise in respect of the Collateral all
rights and remedies of a secured party under the Code) and exercise its
remedies whether by suit in equity or by action at law, or both, whether
for the specific performance of any covenant, agreement or other provision
of any of the Loan Documents or any other legal or equitable right or
remedy of the Bank;
7.1.4 In addition to those actions that may otherwise be permitted to
be taken by the Bank under any of the Loan Documents, with respect to the
Collateral, take the following actions:
7.1.4.1 COLLECTIONS, ETC. The Bank may demand, xxx for, collect
or receive, in the name of the Bank or in the name of the Borrower, or
otherwise, any money or property at any time payable or receivable on
account of or in exchange for, or make any compromise or settlement
deemed desirable with respect to, any of the Collateral (but the Bank
shall be under no obligation to do so), or extend the time of payment,
arrange for payment in installments, or otherwise modify the term of,
or release, any of the Collateral, without thereby incurring
responsibility to discharge, or discharging, or otherwise affecting
any liability of the Borrower. The Bank shall not be required to take
any steps to preserve any rights against other parties to the
Collateral. The Bank may (but is not obligated to) make such payments
and take all such actions as the Bank deems necessary to protect the
Bank's security interest in the Collateral and/or the value thereof,
and the Bank is hereby authorized (without limiting the general nature
of the authority hereinabove conferred) to pay, purchase, contest or
compromise any Encumbrance; and
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7.1.5 The Bank may exercise all other rights and remedies available at
law or in equity (or both) pursuant to any applicable law, statute, rule or
regulation, including, without limitation, the right to statutorily
foreclose on the Collateral.
7.2 POWER OF ATTORNEY. The Borrower does hereby irrevocably make,
constitute, and appoint the Bank and its officers and designees as its true and
lawful attorney-in-fact, with full power in the name of the Bank and/or the
Borrower, to take the following actions upon the occurrence of an Event of
Default: to do any and all acts necessary or proper to carry out the intent of
the Loan Documents (including, without limitation, execute such further
mortgages, pledges and assignments of the Collateral as the Bank may require for
the purpose of protecting, maintaining, or enforcing the security interests
granted to the Bank by the Loan Documents); enforce all of the Borrower's rights
under all agreements with respect to the Collateral, and the Borrower hereby
ratifies and confirms all that the Bank as such attorney-in-fact or its
substitutes shall properly do by virtue of this power of attorney. Such powers
of attorney are coupled with an interest and are therefore irrevocable.
7.3 RIGHTS AND REMEDIES CUMULATIVE. No right or remedy conferred upon the
Bank in any of the Loan Documents or otherwise available at law or in equity (or
both) shall be exclusive of any other right or remedy contained herein or
therein or otherwise made available. All such rights and remedies are cumulative
and are not exclusive of any right or remedy which the Bank may otherwise have.
7.4 APPLICATION OF PROCEEDS AFTER EVENT OF DEFAULT. After the occurrence of
an Event of Default, all Collateral in the form of cash, all income on the
Collateral and all proceeds from any sale or other disposition of the Collateral
pursuant hereto shall be applied against the Obligations in such order as the
Bank shall in its sole discretion determine. Any amounts remaining after such
applications shall be remitted to the Borrower or as a court of competent
jurisdiction may otherwise direct.
8. INDEMNIFICATION.
8.1 The Borrower agrees to, and hereby does, indemnify, pay and hold the
Bank and its officers, directors, employees and agents (collectively called the
"Indemnitees") harmless from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs and
expenses (including, without limitation, attorneys' fees and costs), fines and
disbursements of any kind or nature whatsoever, known or unknown, contingent or
otherwise, which may be imposed on, incurred by, or asserted against that
Indemnitee, arising out of, or in any way related to, the Bank entering into
this Agreement or making the Advances.
8.2 In the event that any suit, action, investigation, claim or proceeding
is begun, made or instituted as a result of which the Borrower may become
obligated to any Indemnitee hereunder, the Borrower agrees to defend, contest or
otherwise protect against any such suit, action, investigation, claim or
proceeding at its sole cost and expense, using counsel acceptable to the
Indemnitee.
8.3 The indemnifications contained in this Section 8 shall survive the
termination of the other provisions of this Agreement and the repayment of all
of the Obligations, and shall constitute separate and independent obligations of
the Borrower from its other obligations under this Agreement.
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9. NOTICES.
All notices, requests, demands and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been duly given if telecopied or if delivered by messenger or courier delivery,
or sent by first class mail, postage prepaid, certified or registered, return
receipt requested, as set forth below or at such other address as may be
furnished in writing:
If to the Borrower:
WFS Financial Inc.
00 Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx
Telecopier No.: (000) 000-0000
If to the Bank:
Western Financial Bank
00000 Xxxxxx Xxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Attention: Guy Du Bose, Esq.
Telecopier No.: (000) 000-0000
Any notice given by messenger or courier delivery as provided in this Section 9
shall be deemed given when delivered if during normal business hours on a
Business Day (or if not, the next Business Day after delivery); any notice given
by telecopier as provided herein shall be deemed given when sent if during
normal business hours on a Business Day (or, if not, the next Business Day after
it is sent), provided that at the time such telecopy is sent, the sending party
receives written confirmation of receipt and forwards a copy of the notice by
mail, messenger or courier delivery as provided herein; any notice given by
first class mail, postage prepaid, certified or registered, return receipt
requested shall be deemed given two (2) Business Days after the date of mailing.
Any party may by notice to the other change the address at which notices and
demands may be given to it.
10. MISCELLANEOUS.
10.1 NO WAIVER. No failure or delay on the part of the Bank in notifying
the Borrower of an Event of Default, or in exercising, or partial exercise of,
any right, power or privilege hereunder shall operate as a waiver of any Event
of Default, or privilege or right hereunder or otherwise or preclude any other
or further exercise of any other right power or privilege.
10.2 GOVERNING LAW; SUCCESSORS AND ASSIGNS. This Agreement shall be subject
to, construed and governed by, the laws of the State of California without
giving effect to such state's conflicts of law provisions. This Agreement may
not be assigned, pledged, hypothecated or otherwise encumbered by the Borrower.
Subject to the foregoing sentence, this Agreement shall inure to the benefit of
the Bank (and its successors and assigns) and the Borrower, and shall be binding
upon the successors and assigns of the parties hereto.
10.3 HEADINGS. Section headings are included for the sake of convenience
only and shall not affect the interpretation of any provision of this Agreement.
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10.4 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original Agreement, but all of
which together shall constitute one and the same instrument.
10.5 ENTIRE AGREEMENT. The Loan Documents set forth the entire agreement
and understanding of the parties concerning the subject matter of this Agreement
and supersede all prior agreements, arrangements, and understandings regarding
such subject matter between the parties hereto, which agreements, arrangements
and understandings are merged herein.
10.6 COSTS. Whether or not the transactions hereby contemplated shall be
consummated, the Borrower agrees to pay all out-of-pocket costs and expenses
incurred by the Bank in connection with the transactions hereby contemplated
(including, without limitation, the performance of any due diligence by the
Bank) and the preparation, negotiation, execution, delivery, waiver,
Modification and administration of this Agreement, the other Loan Documents and
any other documentation contemplated hereby or thereby, the making of the
Advances and/or the enforcement or protection of the rights of the Bank in
connection therewith, including but not limited to, the Bank's legal fees and
costs. Such payments shall be made within five (5) Business Days of receipt of a
written demand by the Bank.
10.7 SEVERABILITY. Any provision of this Agreement or any other Loan
Document which is invalid, illegal or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such invalidity,
illegality or unenforceability without invalidating the remaining provisions
hereof or thereof, and any such invalidity, illegality or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
10.8 AMENDMENTS. No Modification or waiver of any provision of this
Agreement or any of the other Loan Documents, and no consent to any departure by
the Borrower herefrom or therefrom (including, without limitation, any
Modification to or deviation from any form of Loan Document required to be
delivered hereunder by the Borrower), shall in any event be effective unless the
same shall be in writing and signed by the Bank and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given.
10.9 MAXIMUM RATE. No provision of this Agreement shall be deemed to
establish or require the payment of interest at a rate in excess of the maximum
rate permitted by applicable law. In the event that the interest required to be
paid under this Agreement exceeds the maximum rate permitted by applicable law,
the interest required to be paid hereunder shall be automatically reduced to the
maximum rate permitted by applicable law. In the event any interest paid exceeds
the then applicable legal rate, the excess of such interest over the maximum
amount of interest permitted to be charged shall automatically be deemed to be
applied to reduce accrued and unpaid Costs, if any; then to reduce accrued and
unpaid interest, if any; and then to reduce Principal; the balance of any excess
Interest remaining after application of the foregoing, if any, shall be refunded
to the Borrower.
AS WITNESS the hands of the parties hereto the day and year first set forth
above.
WFS FINANCIAL INC
By: /s/ XXXXX XXXXXX
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Its:______________________________
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WESTERN FINANCIAL BANK
By: /s/ XXX XXXXXXXX
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Its:______________________________
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EXHIBIT A
FORM OF BORROWING CERTIFICATE
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