CEF EQUIPMENT HOLDING GE COMMERICAL EQUIP FIN SERIES 2004-1 - 8-K - 20041124 - EXHIBIT_4
EXHIBIT 4(c)
EXECUTION VERSION
LOAN SALE AGREEMENT
November 16, 2004,
among
GENERAL ELECTRIC CAPITAL CORPORATION,
as Seller,
GENERAL ELECTRIC CREDIT CORPORATION OF TENNESSEE,
as Seller,
and
CEF EQUIPMENT HOLDING, L.L.C.,
as Purchaser
Loan Sale Agreement
This LOAN SALE AGREEMENT ("Agreement" or "Sale Agreement") is entered into
as of November 16, 2004 by and among GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation ("GE Capital"), GENERAL ELECTRIC CREDIT CORPORATION OF
TENNESSEE, a Tennessee corporation ("GECT" and together with GE Capital, the
"Sellers", and individually, each a "Seller") and CEF EQUIPMENT HOLDING, L.L.C.,
a Delaware limited liability company (the "Purchaser").
In consideration of the premises and the mutual covenants hereinafter
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in Section 1 of Annex A to this
Agreement.
Section 1.2 Rules of Construction. For purposes of this Agreement, the
rules of construction set forth in Section 2 of Annex A shall govern. All
Annexes, Exhibits and Schedules hereto, are incorporated herein by reference
and, taken together with this Agreement, shall constitute but a single
agreement.
ARTICLE II
SALES OF CEF ASSETS
Section 2.1 Sale of Loans. (a) Subject to the terms and conditions hereof
each Seller does hereby sell, transfer, assign, set over and otherwise convey to
the Purchaser, without recourse (subject to the obligations herein) all right,
title and interest of each Seller in:
(i) the Loans, including the Loan Files, and all obligations of
the Obligors thereunder, including the right to payment of any
interest accrued and to accrue from and after November 1, 2004
or finance charges and other obligations of such Obligor with
respect thereto due or to become due on or after the Cutoff
Date;
(ii) all Related Security and Collections with respect thereto;
(iii) all other property now or hereafter in the possession or
custody of, or in transit to, the Issuer, the Servicer, any
Sub-Servicer or each Seller relating to any of the foregoing;
(iv) all Records with respect to any of the foregoing; and
(v) all proceeds of the foregoing (collectively the "CEF Assets").
Loan Sale Agreement
(b) On or before the Closing Date, each Seller shall (i) indicate
in its computer files that the CEF Assets have been sold to the Purchaser
pursuant to this Agreement by so identifying such CEF Assets with an
appropriate notation and (ii) deliver to the Purchaser or its designee the
following documents (collectively, the "Loan Files"):
(i) the original fully executed copy of the Loan;
(ii) a record or facsimile of the original credit application fully
executed by the Obligor;
(iii) the original certificate of title or file stamped copy of the
UCC financing statement or such other documents evidencing the
security interest of the Purchaser in the Equipment; and
(iv) any and all other documents relating to a Loan, an Obligor or
any of the Equipment.
Section 2.2 Grant of Security Interest. The parties hereto intend that the
sale pursuant to Section 2.1 hereof shall constitute a purchase and sale and not
a loan. Notwithstanding anything to the contrary set forth in this Section 2.2,
if a court of competent jurisdiction determines that the sale provided for
herein constitutes a loan and not a purchase and sale, then the parties hereto
intend that this Agreement shall constitute a security agreement under
applicable law and that each Seller shall be deemed to have granted, and each
Seller hereby grants, to the Purchaser a first priority lien and security
interest in and to all of such Seller's right, title and interest in, to and
under the CEF Assets sold and transferred by such Seller on the Closing Date.
The possession by the Purchaser of notes and such other goods, money, documents,
chattel paper or certificated securities shall be deemed to be "possession by or
delivery to secured party" for purposes of perfecting the security interest
pursuant to the UCC in force in the relevant jurisdiction (including, without
limitation, Section 9-313(c)(1) thereof). Notifications to persons holding such
property, and acknowledgments, receipts or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, bailees or agents (as applicable) of the Purchaser for the
purpose of perfecting such security interest under applicable law (except that
nothing in this sentence shall cause any Person to be deemed to be an agent of
the Purchaser for any purpose other than for perfection of such security
interest unless, and then only to the extent, expressly appointed and authorized
by the Purchaser in writing).
Section 2.3 Sale Price. (a) As consideration for the sale of the CEF
Assets pursuant to Section 2.1 hereof, the Purchaser shall pay to the applicable
Seller on the Closing Date, the CEF Cash Purchase Price for the CEF Assets sold
and transferred by such Seller to the Purchaser on the Closing Date. The CEF
Cash Purchase Price for the sale of CEF Assets shall be an amount equal to the
fair market value thereof as agreed upon by the Purchaser and the applicable
Seller prior to such sale.
(b) The CEF Cash Purchase Price for the CEF Assets sold by each
Seller under this Agreement shall be payable in full in cash by the
Purchaser on the Closing Date. On the Closing Date, the Purchaser shall,
upon satisfaction of the applicable
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2
conditions set forth in Article III, make available to each of the Sellers
the CEF Cash Purchase Price in same day funds.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 Conditions to Sale. Each sale hereunder shall be subject to
satisfaction of each of the following conditions precedent (any one or more of
which, except clause (e) below, may be waived in writing by the Purchaser) as of
the Closing Date:
(a) This Agreement or counterparts hereof shall have been duly
executed by, and delivered to, the applicable Seller and the Purchaser,
and the Purchaser shall have received such documents, instruments,
agreements and legal opinions as the Purchaser shall reasonably request in
connection with the transactions contemplated by this Agreement, each in
form and substance reasonably satisfactory to the Purchaser.
(b) The Purchaser shall have received satisfactory evidence that
the applicable Seller has obtained all required consents and approvals of
all Persons, including all requisite Governmental Authorities, to the
execution, delivery and performance of this Agreement and the consummation
of the transactions contemplated hereby.
(c) The applicable Seller shall be in compliance in all material
respects with all applicable foreign, federal, state and local laws and
regulations, including those specifically referenced in Section 4.2(c),
except to the extent that the failure to so comply, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse
Effect.
(d) The representations and warranties of the applicable Seller
contained herein or in any other Related Document shall be true and
correct in all material respects (or, to the extent any such
representation or warranty is qualified by a materiality standard, such
representation or warranty shall be true and correct) as of the Closing
Date, both before and after giving effect to such sale, except to the
extent that any such representation or warranty expressly relates to an
earlier date and except for changes therein expressly permitted by this
Agreement.
(e) At the time of such sale, the Purchaser shall have sufficient
funds on hand to pay the CEF Cash Purchase Price.
(f) The applicable Seller shall be in compliance with each of its
covenants and other agreements set forth herein.
(g) The applicable Seller shall have taken such other action,
including delivery of approvals, consents, opinions, documents and
instruments to the Purchaser as the Purchaser may reasonably request.
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The consummation by a Seller of the sale of CEF Assets on the Closing Date shall
be deemed to constitute, as of the Closing Date, a representation and warranty
by such Seller that the conditions in clauses (d), (f) and (g) of this Section
3.1 have been satisfied.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1 Representations and Warranties of the Sellers. To induce the
Purchaser to purchase the CEF Assets, each Seller makes the following
representations and warranties to the Purchaser, as of the Closing Date, each
and all of which shall survive the execution and delivery of this Agreement.
(a) Corporate Existence; Power and Authority. Such Seller (i) is a
corporation duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization; and (ii) has all requisite
power and authority and licenses to conduct its business, to own its
properties and to execute, deliver and perform its obligations under this
Agreement.
(b) UCC Information. The true legal name of such Seller as
registered in the jurisdiction of its organization, and the current
location of such Seller's jurisdiction of organization are set forth in
Schedule 4.1(b) and such location has not changed within the past 12
months with respect to such Seller. During the prior five years, except as
set forth in Schedule 4.1(b), such Seller has not been known as or used
any corporate, fictitious or trade name. In addition, Schedule 4.1(b)
lists the Seller's (i) federal employer identification number and (ii)
organizational identification number as designated by the jurisdiction of
its organization.
(c) Authorization, Compliance with Law. The execution, delivery
and performance by such Seller of this Agreement and the other Related
Documents and the creation and perfection of all Liens and ownership
interests provided for herein: (i) have been duly authorized by all
necessary corporate action, and (ii) do not violate any provision of any
law or regulation of any Governmental Authority, or contractual or
corporate restrictions, binding on such Seller, except where such
violations, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
(d) Enforceability. On or prior to the Closing Date, each of the
Related Documents to which a Seller is a party shall have been duly
executed and delivered by such Seller and each such Related Document shall
then constitute a legal, valid and binding obligation of such Seller,
enforceable against it in accordance with its terms, subject as to
enforcement to bankruptcy, receivership, conservatorship, insolvency,
reorganization, moratorium and other similar laws of general applicability
relating to or affecting creditors' rights and to general principles of
equity.
(e) Solvency. Such Seller is Solvent.
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(f) Use of Proceeds. No proceeds received by such Seller under
this Agreement will be used by it for any purpose that violates Regulation
U of the Federal Reserve Board.
(g) Investment Company Act. Such Seller is not an "investment
company" or "controlled by" an "investment company," as such terms are
defined in the Investment Company Act.
(h) Loans and Other CEF Assets. With respect to each Loan and the
other CEF Assets sold by such Seller on the Closing Date, such Seller
represents and warrants that (i) such Loan satisfies the criteria for an
Eligible Loan as of the Cut-Off Date; (ii) immediately prior to sale to
the Purchaser, such CEF Assets were owned by such Seller free and clear of
any Adverse Claim, and such Seller has had at all relevant times the full
right, power and authority to sell, contribute, assign, transfer and
pledge its interest therein as contemplated under this Agreement and, upon
such sale, the Purchaser will acquire valid and properly perfected title
to, and the sole record and beneficial ownership interest in, such CEF
Assets, free and clear of any Adverse Claim or restrictions on
transferability, and the Liens granted to the Purchaser by such Seller
pursuant to Section 2.2 will at all times be fully perfected first
priority Liens in and to such Loans and, in addition, following such sale,
such Loan will not be subject to any Adverse Claim as a result of any
action or inaction on the part of such Seller (or any predecessor in
interest); and (iii) if such Loan is cross-collateralized with a loan that
is not a CEF Asset conveyed hereunder, as of the Closing Date, either (x)
the repossession or exercise of other rights with respect to the related
Equipment by the holder of such loan would not materially impair the
security intended to be afforded for such Loan and result in a material
adverse effect on the holders of the Notes or (y) the holder of such loan
and the Purchaser or its assigns as holder of the Loan have entered into
an intercreditor arrangement under which each holder has agreed to
subordinate its respective lien and rights of enforcement against the
Equipment financed by the other holder or its predecessor in interest.
The representations and warranties described in this Section 4.1 shall survive
the sale of the CEF Assets to the Purchaser, any subsequent assignment or sale
of the CEF Assets by the Purchaser, and the termination of this Agreement and
the other Related Documents and shall continue until the payment in full of all
CEF Assets.
Section 4.2 Affirmative Covenants of the Sellers. Each Seller covenants
and agrees that, unless otherwise consented to by the Purchaser, from and after
the Closing Date:
(a) Records. The Seller shall at its own cost and expense, for not
less than three years from the date on which each Loan was originated, or
for such longer period as may be required by law, maintain adequate
Records with respect to such Loan, including records of all payments
received, credits granted and merchandise returned with respect thereto.
(b) Access. At any reasonable time, and from time to time at the
Purchaser's reasonable request, and upon at least seven days prior notice
to such Seller, such Seller shall permit the Purchaser (or such Person as
the Purchaser may designate), at the
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5
expense of the Purchaser (or such Person as the Purchaser may designate),
to conduct audits or visit and inspect any of the properties of such
Seller to examine the records, internal controls and procedures maintained
by such Seller with respect to the CEF Assets and take copies and extracts
therefrom, and to discuss such Seller's affairs with its officers,
employees and, upon notice to such Seller, independent accountants. Such
Seller shall authorize such officers, employees and independent
accountants to discuss with the Purchaser (or such Person as the Purchaser
may designate) the affairs of such Seller as such affairs relate to the
CEF Assets. Any audit provided for herein shall be conducted in accordance
with such Seller's rules respecting safety and security on its premises
and without materially disrupting operations. If an Event of Default shall
have occurred and be continuing, such Seller shall provide such access at
all times and without advance notice and shall provide the Purchaser (or
such Person as the Purchaser may designate) with access to its suppliers
and customers.
(c) Compliance With Agreements and Applicable Laws. The Seller
shall comply with all federal, state and local laws and regulations
applicable to it and the CEF Assets, including those relating to truth in
lending, fair credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices, privacy, licensing and
taxation, except to the extent that the failure to so comply, individually
or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
(d) Maintenance of Existence and Conduct of Business. The Seller
shall preserve and maintain its corporate existence, rights, franchise and
privileges in the jurisdiction of its incorporation.
(e) Notice of Material Event. The Seller shall promptly inform the
Purchaser in writing of the occurrence of any of the following, in each
case setting forth the details thereof and what action, if any, the Seller
proposes to take with respect thereto:
(i) any Litigation commenced, or to the knowledge of the Seller,
threatened against the Seller or with respect to or in
connection with all or any substantial portion of the CEF
Assets or developments in such Litigation in each case that
the Seller believes has a reasonable risk of being determined
adversely to the Seller and that could, if determined
adversely, have a Material Adverse Effect; or
(ii) the commencement of a case or proceeding by or against the
Seller seeking a decree or order in respect of the Seller (A)
under the Bankruptcy Code or any other applicable federal,
state or foreign bankruptcy or other similar law, (B)
appointing a custodian, receiver, liquidator, assignee,
trustee or sequestrator (or similar official) for the Seller
or for any substantial part of the Seller's assets, or (C)
ordering the winding-up or liquidation of the affairs of the
Seller.
(f) Separate Identity. The Seller shall, to the extent applicable
to it, act in a manner that is consistent with the statements
set forth in Exhibit 4.2(f).
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(g) Deposit of Collections. The Seller shall transfer and cause
its Subsidiaries to transfer to the Purchaser or the Servicer on its
behalf, promptly, and in any event no later than the second Business Day
after receipt thereof, all Collections it may receive in respect of CEF
Assets.
(h) Sale Characterization. For accounting purposes, the Seller
shall treat the sale made hereunder as a sale of the CEF Assets. The
Seller shall also maintain its accounting books and records in a manner
which clearly reflects such sale of the CEF Assets to the Purchaser.
Section 4.3 Negative Covenants of the Sellers. Each Seller covenants and
agrees that, without the prior written consent of the Purchaser, from and after
the Closing Date and until the later of the Redemption Date or the Class C
Maturity Date:
(a) Adverse Claims. The Seller shall not create, incur, assume or
permit to exist any Adverse Claim on or with respect to any CEF Assets.
(b) UCC Matters. The Seller shall not change its state of
organization or incorporation or its name, identity or corporate structure
such that any financing statement filed to perfect the Purchaser's
interests under this Agreement would become seriously misleading, unless
the Seller shall have given the Purchaser not less than 30 days' prior
written notice of such change.
(c) No Proceedings. From the Closing Date and until the date one
year plus one day following the date on which all amounts due with respect
to the Notes have been paid in full in cash, Seller shall not, directly or
indirectly, institute or cause to be instituted against the Purchaser any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or
similar law; provided that the foregoing shall not in any way limit the
Seller's right to pursue any other creditor rights or remedies that the
Seller may have under applicable law.
ARTICLE V
INDEMNIFICATION
Section 5.1 Indemnification. Without limiting any other rights that the
Purchaser or any of its Stockholders, officers, directors, employees, attorneys,
agents or representatives (each, a "Purchaser Indemnified Person") may have
hereunder or under applicable law, each Seller hereby agrees severally to
indemnify and hold harmless each Purchaser Indemnified Person from and against
any and all Indemnified Amounts that may be claimed or asserted against or
incurred by any such Purchaser Indemnified Person to the extent arising from or
related to the failure of a Loan sold and transferred by such Seller to be
originated in compliance with all requirements of law; provided, that no Seller
shall be liable for any indemnification to a Purchaser Indemnified Person to the
extent that any such Indemnified Amounts result from (a) such Purchaser
Indemnified Person's bad faith, gross negligence or willful misconduct, (b)
recourse for uncollectible Loans, or (c) any income tax or franchise tax
incurred by any Purchaser
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Indemnified Person, except to the extent that the incurrence of any such tax
results from a breach of or default by such Seller under this Agreement.
NO PARTY TO THIS AGREEMENT SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO
THIS AGREEMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH
PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR
INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES THAT MAY BE ALLEGED AS A
RESULT OF ANY TRANSACTION CONTEMPLATED HEREUNDER.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by any other parties, or whenever any of the parties desires to give or
serve upon any other parties any communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be deemed to have been validly
served, given or delivered (a) upon the earlier of actual receipt and three
Business Days after deposit in the United States mail, registered or certified
mail, return receipt requested, with proper postage prepaid, (b) upon
transmission, when sent by telecopy or other similar facsimile transmission
(with such telecopy or facsimile promptly confirmed by delivery of a copy by
personal delivery or United States mail as otherwise provided in this Section
6.1), (c) one Business Day after deposit with a reputable overnight courier with
all charges prepaid or (d) when delivered, if hand-delivered by messenger, all
of which shall be addressed to the party to be notified and sent to the address
or facsimile number set forth below or to such other address (or facsimile
number) as may be substituted by notice given as herein provided. The giving of
any notice required hereunder may be waived in writing by the party entitled to
receive such notice. Failure or delay in delivering copies of any notice,
demand, request, consent, approval, declaration or other communication to any
Person (other than Purchaser) designated in any written communication provided
hereunder to receive copies shall in no way adversely affect the effectiveness
of such notice, demand, request, consent, approval, declaration or other
communication. Notwithstanding the foregoing, whenever it is provided herein
that a notice is to be given to any other party hereto by a specific time, such
notice shall be effective only if actually received by such party prior to such
time, and if such notice is received after such time or on a day other than a
Business Day, such notice shall be effective only on the immediately succeeding
Business Day.
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If to GE Capital:
General Electric Capital Corporation
44 Old Ridgebury Road
Danbury, Connecticut 06810
Attention: General Counsel
Telephone: (203) 796-1000
Facsimile: (203) 796-1313
If to GECT:
General Electric Credit Corporation of Tennessee
44 Old Ridgebury Road
Danbury, CT 06801
Attention: Linda Zecher
Telephone: 302-739-3073
Facsimile: 302-739-5831
Attention: Capital Markets Operations
Telephone: (203) 796-5518
Facsimile: (203) 796-5554
Section 6.2 No Waiver; Remedies. (a) Any party's failure, at any time or
times, to require strict performance by any other party hereto of any provision
of this Agreement shall not waive, affect or diminish any right of such party
thereafter to demand strict compliance and performance herewith. Any suspension
or waiver of any breach or default hereunder shall not suspend, waive or affect
any other breach or default whether the same is prior or subsequent thereto and
whether of the same or a different type. None of the undertakings, agreements,
warranties, covenants and representations of any party contained in this
Agreement, and no breach or default by any party hereunder, shall be deemed to
have been suspended or waived by any other party hereto unless such waiver or
suspension is by an instrument in writing signed by an officer of or other duly
authorized signatory of such party and directed to the defaulting party
specifying such suspension or waiver.
(b) Upon discovery by any Seller or the Purchaser of any breach of
any representation, warranty, undertaking or covenant described in
Sections 4.1, 4.2 or 4.3, which breach is reasonably likely to have a
Material Adverse Effect, the party discovering the same shall give prompt
written notice thereof to the other parties hereto.
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As liquidated damages, the Purchaser shall, on the Transfer Date relating
to the Collection Period during which the breach is discovered, request
the applicable Seller to, and such Seller shall pay to, or at the
direction of, the Purchaser the Purchase Amount for the applicable CEF
Assets (measured at the end of the Collection Period during which such
breach is discovered). Upon such payment, all rights, title and interest
of the Purchaser in and to such CEF Assets will be deemed to be
automatically released without the necessity of any further action by the
Purchaser, the applicable Seller or any other party and such CEF Assets
will become the property of the such Seller.
(c) Each party's rights and remedies under this Agreement shall be
cumulative and nonexclusive of any other rights and remedies that such
party may have under any other agreement, including the other Related
Documents, by operation of law or otherwise.
Section 6.3 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of each Seller and the Purchaser and their
respective successors and permitted assigns, except as otherwise provided
herein. No Seller may assign, transfer, hypothecate or otherwise convey its
rights, benefits, obligations or duties hereunder without the prior express
written consent of the Purchaser. Any such purported assignment, transfer,
hypothecation or other conveyance by any Seller without the prior express
written consent of the Purchaser shall be void. Each Seller acknowledges that
under the Purchase and Sale Agreement the Purchaser will assign its rights
granted hereunder to the Issuer, and upon such assignment, the Issuer shall
have, to the extent of such assignment, all rights of the Purchaser hereunder
and the Issuer may in turn transfer such rights. The terms and provisions of
this Agreement are for the purpose of defining the relative rights and
obligations of each of the Sellers and the Purchaser with respect to the
transactions contemplated hereby and no Person shall be a third-party
beneficiary of any of the terms and provisions of this Agreement.
Section 6.4 Termination; Survival of Obligations. (a) This Agreement shall
create and constitute the continuing obligations of the parties hereto in
accordance with its terms, and shall remain in full force and effect until the
earlier of (i) the Class C Maturity Date or (ii) the Redemption Date.
(b) Except as otherwise expressly provided herein or in any other
Related Document, no termination or cancellation (regardless of cause or
procedure) of any commitment made by the Purchaser under this Agreement
shall in any way affect or impair the obligations, duties and liabilities
of any Seller or the rights of the Purchaser relating to any unpaid
portion of any and all recourse and indemnity obligations of such Seller
to the Purchaser, due or not due, liquidated, contingent or unliquidated
or any transaction or event occurring prior to such termination, or any
transaction or event, the performance of which is required after the Class
C Maturity Date. Except as otherwise expressly provided herein or in any
other Related Document, all undertakings, agreements, covenants,
warranties and representations of or binding upon any Seller, and all
rights of the Purchaser hereunder shall not terminate or expire, but
rather shall survive any such termination or cancellation and shall
continue in full force and effect until the earlier of (i) the Class C
Maturity Date or (ii) the Redemption Date; provided, that the rights and
remedies pursuant to Section 6.2(b), the indemnification and payment
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provisions of Article V, and the provisions of Sections 4.3(c), 6.3 and
6.12 shall be continuing and shall survive any termination of this
Agreement.
Section 6.5 Complete Agreement; Modification of Agreement. This Agreement
constitutes the complete agreement between the parties with respect to the
subject matter hereof, supersedes all prior agreements and understandings
relating to the subject matter hereof and thereof, and may not be modified,
altered or amended except as set forth in Section 6.6.
Section 6.6 Amendments and Waivers. No amendment, modification,
termination or waiver of any provision of this Agreement, or any consent to any
departure therefrom by any party hereto, shall in any event be effective unless
the same shall be in writing and signed by each of the parties hereto and their
respective permitted successors and assigns. No consent or demand in any case
shall, in itself, entitle any party to any other consent or further notice or
demand in similar or other circumstances.
Section 6.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL IN ALL RESPECTS,
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, BE GOVERNED BY,
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS THEREOF EXCEPT
SECTION 5-1401 OF THE GENERAL OBLIGATION LAW) AND ANY APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA.
(b) EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR
FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY SHALL
HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES
BETWEEN THEM PERTAINING TO THIS AGREEMENT OR TO ANY MATTER ARISING OUT OF
OR RELATING TO THIS AGREEMENT; PROVIDED, THAT EACH PARTY HERETO
ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A
COURT LOCATED OUTSIDE OF THE BOROUGH OF MANHATTAN IN NEW YORK CITY;
PROVIDED FURTHER, THAT NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR
OPERATE TO PRECLUDE THE PURCHASER FROM BRINGING SUIT OR TAKING OTHER LEGAL
ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE CEF ASSETS OR ANY
SECURITY FOR THE OBLIGATIONS OF ANY SELLER ARISING HEREUNDER OR TO ENFORCE
A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE PURCHASER. EACH PARTY
HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION
OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH PARTY HERETO HEREBY WAIVES
ANY OBJECTION THAT SUCH PARTY MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS
TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE
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BY SUCH COURT. EACH PARTY HERETO HEREBY WAIVES PERSONAL SERVICE OF THE
SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND
AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH PARTY AT ITS
ADDRESS DETERMINED IN ACCORDANCE WITH SECTION 6.1 AND THAT SERVICE SO MADE
SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH PARTY'S ACTUAL RECEIPT
THEREOF OR THREE DAYS AFTER DEPOSIT IN THE UNITED STATES MAIL, PROPER
POSTAGE PREPAID. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF ANY
PARTY HERETO TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
(c) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED
AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS
TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE,
TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND
OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF, CONNECTED WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 6.8 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which shall collectively and separately
constitute one agreement.
Section 6.9 Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this Agreement.
Section 6.10 Section Titles. The section titles and table of contents
contained in this Agreement are provided for ease of reference only and shall be
without substantive meaning or content of any kind whatsoever and are not a part
of the agreement between the parties hereto.
Section 6.11 No Setoff. No Seller's obligations under this Agreement shall
be affected by any right of setoff, counterclaim, recoupment, defense or other
right such Seller might have against the Purchaser, all of which rights are
hereby expressly waived by such Seller.
Loan Sale Agreement
12
Section 6.12 Confidentiality. Notwithstanding anything herein to the
contrary, there is no restriction (express or implied) on any disclosure or
dissemination of the structure or tax aspects of the transaction contemplated by
the Related Documents. Furthermore, each party hereto acknowledges that it has
no proprietary rights to any tax matter or tax idea contemplated hereby or to
any element of the transaction structure contemplated hereby.
Section 6.13 Further Assurances. (a) Each Seller shall, at its sole cost
and expense, upon request of the Purchaser, promptly and duly authorize, execute
and/or deliver, as applicable, any and all further instruments and documents and
take such further actions that may be necessary or desirable or that the
Purchaser may request to carry out more effectively the provisions and purposes
of this Agreement or to obtain the full benefits of this Agreement and of the
rights and powers herein granted, including authorizing and filing any financing
or continuation statements under the UCC with respect to the ownership interests
or Liens granted hereunder. Each Seller hereby authorizes the Purchaser to file
any such financing or continuation statements without the signature of such
Seller to the extent permitted by applicable law. A carbon, photographic or
other reproduction of this Agreement or of any notice or financing statement
covering the CEF Assets or any part thereof shall be sufficient as a notice or
financing statement where permitted by law. If any amount payable under or in
connection with any of the CEF Assets is or shall become evidenced by any
instrument, such instrument, other than checks and notes received in the
ordinary course of business, shall be duly endorsed in a manner satisfactory to
the Purchaser immediately upon such Seller's receipt thereof and promptly
delivered to or at the direction of the Purchaser.
(b) If any Seller fails to perform any agreement or obligation under
this Section 6.13, the Purchaser may (but shall not be required to) itself
perform, or cause performance of, such agreement or obligation, and the
reasonable expenses of the Purchaser incurred in connection therewith shall be
payable by such Seller upon demand of the Purchaser.
Section 6.14 Accounting Changes. If any Accounting Changes occur and such
changes result in a change in the standards or terms used herein, then the
parties hereto agree to enter into negotiations in order to amend such
provisions so as to equitably reflect such Accounting Changes with the desired
result that the criteria for evaluating the financial condition of such Persons
and their Subsidiaries shall be the same after such Accounting Changes as if
such Accounting Changes had not been made. If the parties hereto agree upon the
required amendments to this Agreement, then after appropriate amendments have
been executed and the underlying Accounting Change with respect thereto has been
implemented, any reference to GAAP contained herein shall, only to the extent of
such Accounting Change, refer to GAAP consistently applied after giving effect
to the implementation of such Accounting Change. If such parties cannot agree
upon the required amendments within 30 days following the date of implementation
of any Accounting Change, then all financial statements delivered and all
standards and terms used herein shall be prepared, delivered and used without
regard to the underlying Accounting Change.
[Signatures Follow]
Loan Sale Agreement
13
IN WITNESS WHEREOF, the parties have caused this LOAN SALE AGREEMENT to be
executed by their respective duly authorized representatives, as of the date
first above written.
General Electric Capital Corporation
True Legal Name: General Electric Capital
Corporation
Jurisdiction of Organization: Delaware
Executive Offices/Principal Place of 44 Old Ridgebury Road
Business: Danbury, Connecticut 06810
Collateral Locations: Danbury, Connecticut
El Paso, Texas
Mexico
India
Trade Names: GE Capital
FEIN: 13-1500700
Organizational Identification Number: 3174543
General Electric Credit Corporation of
Tennessee
True Legal Name: General Electric Credit
Corporation of Tennessee
Jurisdiction of Organization: Tennessee
Executive Offices/Principal Place of 20225 Water Tower Blvd, Suite 300
Business: Brookfield, WI 53045-3598
Collateral Locations: El Paso, TX
Trade Names: None
FEIN: 06-0876201
Organizational Identification Number: [ ]
Loan Sale Agreement
The Purchaser, GECS and the Sellers have and will continue (in each case,
to the extent within its control) to maintain the Purchaser's separate existence
and identity and have and will continue to take all steps necessary to make it
apparent to third parties that the Purchaser is an entity with assets and
liabilities distinct from those of the Sellers or GECS or any other Subsidiary
or Affiliate of any Seller or GECS. In addition to the foregoing, such steps and
indicia of the Purchaser's separate identity include the following:
(a) The Purchaser does and will maintain its own stationery and other
business forms separate from those of any other Person (including the Sellers
and GECS), and will conduct business in its own name except that certain Persons
may act on behalf of the Purchaser as agents;
(b) The Purchaser maintains and will maintain separate office space of its
own as part of its operations, although such space is in a building shared with
GE Capital. The corporate records, the other books and records, and the other
assets of the Purchaser are and will be segregated from the property of each of
the Sellers and GECS, respectively;
(c) The Sellers will issue consolidated financial statements, which
financial statements will not show CEF Assets that have been sold by such Seller
to the Purchaser as assets of such Seller and its consolidated subsidiaries.
Each of the Sellers, GECS and the Purchaser will take certain actions to
disclose publicly the Purchaser's separate existence and the transactions
contemplated hereby, including through the filing of the UCC Financing
Statements. None of the Sellers, GECS or the Purchaser has concealed or will
conceal from any interested party any transfers contemplated by the Related
Documents;
(d) The Purchaser will not have its own employees, and, as indicated, the
Purchaser's business relating to the CEF Assets may be conducted through the
agents. However, any allocations of direct, indirect or overhead expenses for
items shared between the Purchaser and GE Capital or GECS that are not included
as part of the Servicing Fee are and will be made among such entities to the
extent practical on the basis of actual use or value of services rendered and
otherwise on a basis reasonably related to actual use or the value of services
rendered;
(e) Except as provided in paragraph (d) above regarding the allocation of
certain shared overhead items, the Purchaser does and will pay its own operating
expenses and liabilities from its own funds, except GECS did and will pay all
expenses of the Purchaser incurred in connection with the transactions entered
into pursuant to the Related Documents, including those related to the
Purchaser's organization;
(f) Each of the Sellers, GECS and the Purchaser does and will maintain its
assets and liabilities in such a manner that it is not costly or difficult to
segregate, ascertain or otherwise identify the Purchaser's individual assets and
liabilities from those of the Sellers or GECS or from those of any other Person
or entity, including any other subsidiary or affiliate of the Sellers or GECS.
Except as set forth below, the Purchaser does and will maintain its own books of
account and corporate records separate from each of the Sellers and GECS or any
other
Loan Sale Agreement
Subsidiary or Affiliate of the Sellers and GECS. Monetary transactions,
including those with each other, are and will continue to be properly reflected
in their respective financial records. The Purchaser does not and will not
commingle or pool its funds or other assets or liabilities with those of any
Seller or GECS or any other Subsidiary or Affiliate of the Sellers or GECS
except as specifically provided in the Related Documents with respect to the
temporary commingling of Collections and with respect to, if applicable, any
such Person's retention, in their capacity as agent or Custodian for the
Purchaser, of the books and records pertaining to the CEF Assets. However, any
such agent or Custodian will not generally make the books and records relating
to the CEF Assets available to any of creditors or other interested persons of
the Purchaser, the Sellers or GECS. The Purchaser does not and will not maintain
joint bank accounts or other depository accounts to which any Seller or GECS or
any other Subsidiary or Affiliate of the Sellers or GECS (other than in their
capacity as agent for the Purchaser, if applicable) has independent access;
(g) The Purchaser will strictly observe corporate formalities, and the
Sellers and GECS will strictly observe corporate formalities with respect to its
dealings with the Purchaser. Specifically, no transfer of assets between any of
the Sellers and GECS, on the one hand, and the Purchaser, on the other, will be
made without adherence to corporate formalities;
(h) The transactions among the Purchaser and the Sellers or GECS,
including, in the case of GE Capital, the terms governing any servicer advances
and the amount and payment of the servicing fee, are on terms and conditions
that are consistent with those of arm's-length relationships. None of the
Sellers or GECS is or will be, or holds or will hold itself out to be,
responsible for the debts of the Purchaser, except as provided in the
representations made by the Sellers (including, if applicable, as a servicer or
a sub-servicer) to the Purchaser relating to the CEF Assets and their prior
ownership and servicing thereof. The Purchaser will not guaranty the debts of
any Seller or GECS;
(i) All distributions made by the Purchaser to GECS as its sole member
shall be in accordance with applicable law;
(j) Any other transactions between the Purchaser and any Seller or GECS
permitted by (although not expressly provided for in) the Related Documents have
been and will be fair and equitable to each of the parties, have been and will
be the type of transaction that would be entered into by a prudent Person or
entity, and have been and will be on terms that are at least as favorable as may
be obtained from a third party Person; and
(k) The Purchaser is not named, or has entered into any agreement to be
named, directly or indirectly, as a direct or contingent beneficiary or loss
payee on any insurance policy covering the assets of any Seller or GECS.
* * * * * *
Loan Sale Agreement
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions...................................................... 1
Section 1.2 Rules of Construction............................................ 1
ARTICLE II
SALES OF CEF ASSETS
Section 2.1 Sale of Loans.................................................... 1
Section 2.2 Grant of Security Interest....................................... 2
Section 2.3 Sale Price....................................................... 2
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 Conditions to Sale............................................... 3
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1 Representations and Warranties of the Sellers.................... 4
Section 4.2 Affirmative Covenants of the Sellers............................. 5
Section 4.3 Negative Covenants of the Sellers................................ 7
ARTICLE V
INDEMNIFICATION
Section 5.1 Indemnification.................................................. 7
ARTICLE VI
MISCELLANEOUS
Section 6.1 Notices.......................................................... 8
Section 6.2 No Waiver; Remedies.............................................. 9
Section 6.3 Successors and Assigns........................................... 10
Section 6.4 Termination; Survival of Obligations............................. 10
Section 6.5 Complete Agreement; Modification of Agreement.................... 11
Section 6.6 Amendments and Waivers........................................... 11
Section 6.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL..... 11
Section 6.8 Counterparts..................................................... 12
Section 6.9 Severability..................................................... 12
Section 6.10 Section Titles................................................... 12
Section 6.11 No Setoff........................................................ 12
Schedule I Schedule of GECC Loans
Schedule II Schedule of GECT Loans
Exhibit 4.2(f) Separate Indemnity Provisions
-ii-
FINAL VERSION
ANNEX A
to
LOAN SALE AGREEMENT
dated as of
November 16, 2004
Annex A to
Loan Sale Agreement
DEFINITIONS AND INTERPRETATION
SECTION 1. Definitions and Conventions. Capitalized terms used in the Sale
Agreement shall have (unless otherwise provided elsewhere therein) the following
respective meanings:
"Accounting Changes" means, with respect to any Person, an adoption of
GAAP different from such principles previously used for reporting purposes by
such Person as defined in the Accounting Principles Board Opinion Number 20.
"Administration Agreement" means the Administration Agreement, dated as of
November 16, 2004, between the Administrator and the Issuer.
"Administrator" means General Electric Capital Corporation, a Delaware
corporation, in its capacity as Administrator under the Administration
Agreement, or any other Person designated as a successor administrator.
"Adverse Claim" means any claim of ownership or any Lien, other than any
ownership interest or Lien created under the Sale Agreement or the Purchase and
Sale Agreement, any Lien created under the Indenture or any Permitted
Encumbrances.
"Affiliate" means, with respect to any Person, (a) each Person that,
directly or indirectly, owns or controls, whether beneficially, or as a trustee,
guardian or other fiduciary, five percent (5%) or more of the stock having
ordinary voting power in the election of directors of such Person, (b) each
Person that controls, is controlled by, or is under common control with such
Person, or (c) each of such Person's officers, directors, joint venturers and
partners. For the purposes of this definition, "control" of a Person means the
possession, directly or indirectly, of the power to direct or cause the
direction of its management or policies, whether through the ownership of voting
securities, by contract or otherwise.
"Annual Percentage Rate" or "APR" of a Loan means, the interest rate or
annual rate of finance charges stated in or, if not explicitly stated, the
implicit finance charge used by the Servicer to calculate periodic payments with
respect to the related Loan.
"Appendices" means, with respect to any Related Document, all exhibits,
schedules, annexes and other attachments thereto, or expressly identified
thereto.
"Bankruptcy Code" means the provisions of Title 11 of the United States
Code, 11 U.S.C. Sections 101 et seq. as amended from time to time.
"Business Day" means any day that is not a Saturday, a Sunday or a day on
which banks are required or permitted to be closed in the State of New York or
the State of Connecticut.
"CEF Assets" is defined in Section 2.1(a) of the Sale Agreement.
"CEF Cash Purchase Price" means, with respect to the sale of CEF Assets
sold and transferred by any Seller on the Closing Date, the portion of the sale
price therefor determined by
Annex A to
Loan Sale Agreement
the applicable Seller and the Purchaser pursuant to Section 2.3(a) of the Sale
Agreement to be paid in cash.
"CEF Limited Liability Company Agreement" means the Second Amended and
Restated Limited Liability Company Agreement of the Purchaser dated as of
September 25, 2003, as the same may be amended and supplemented from time to
time.
"Class C Maturity Date" is defined in the Indenture.
"Closing Date" means November 16, 2004.
"Collection Period" means, with respect to any Payment Date, the calendar
month preceding the month in which the Payment Date occurs (or, if for the first
Payment Date, the period from and including the day after the Cut-off Date to
and including the last day of the calendar month preceding the calendar month in
which the first Payment Date occurs).
"Collections" means, with respect to any Payment Date all payments made by
or on behalf of the Obligors received during the related Collection Period, any
Recoveries received during the related Collection Period, any proceeds from
insurance policies covering the Equipment or related Obligor received during the
related Collection Period, Liquidation Proceeds received during the related
Collection Period, and payments made by a lessee pursuant to its obligation (if
any) to pay the Termination Value pursuant to the related Loan received during
the related Collection Period; provided, that "Collections" for the first
Collection Period shall exclude interest accrued before November 1, 2004.
"Consumer Contract" means a contract entered into by an Obligor in
connection with a transaction in which the Obligor incurs the related
indebtedness primarily for personal, family, or household purposes.
"Credit and Collection Policies" or "Credit and Collection Policy" means
the policies, practices and procedures adopted by the Issuer on the Closing Date
for providing equipment loans secured by transportation equipment, industrial
equipment, furniture and fixtures, construction equipment, medical and dental
equipment, technology and telecommunications equipment, maritime assets or other
equipment, including the policies and procedures for determining the
creditworthiness of Obligors and the extension of credit to Obligors, or
relating to the maintenance of such types of loans and collections on such types
of loans.
"Cut-off Date" means, with respect to Loans secured by medical and dental
Equipment, September 24, 2004, and with respect to all other Loans, September
25, 2004.
"Dollars" or "$" means lawful currency of the United States of America.
"Eligible Loan" means as to each CEF Asset as of the Closing Date:
(i) Characteristics of CEF Assets. Each CEF Asset: (A) was either
originated in the United States of America by GE Capital in connection
with the financing or lease of Equipment in the ordinary course of GE
Capital's business or acquired by GE Capital in the ordinary course of its
business, and, in each case, was fully and properly executed by
Annex A to
Loan Sale Agreement
2
the parties thereto, (B) has created a valid, subsisting and enforceable
first priority security interest (except to the extent the Equipment
secures any loan that is cross-collateralized with such CEF Asset) in the
Equipment in favor of GE Capital or GECT, as applicable, that, as of the
Closing Date, has been assigned by GE Capital or GECT, as applicable, to
Purchaser, and (C) contains customary and enforceable provisions such that
the rights and remedies of the holder thereof are adequate for realization
against the collateral of the benefits of the security.
(ii) Schedule of CEF Assets. The information set forth on Schedule I
and Schedule II of the Loan Sale Agreement is true and correct in all
material respects as of the opening of business on the Cutoff Date and no
selection procedures believed by the applicable Seller to be adverse to
the interests of the Purchaser were utilized in selecting the CEF Assets.
The computer tape regarding the CEF Assets made available to Purchaser and
its assigns is true and correct in all respects.
(iii) Compliance with Law. Each CEF Asset and the sale or lease of
the related Equipment complied in all material respects at the time it was
originated or made and at the execution of this Agreement with all
requirements of applicable Federal, State and local laws and regulations
thereunder.
(iv) Binding Obligation. Each CEF Asset represents the genuine,
legal, valid and binding payment obligation in writing of the Obligor,
enforceable by the holder thereof in accordance with its terms.
(v) No Government Obligor. None of the CEF Assets is due from the
United States of America or any State or from any agency, department or
instrumentality of the United States of America or any State.
(vi) Security Interest in the Equipment. Immediately prior to the
sale, assignment and transfer thereof, each CEF Asset shall be secured by
a validly perfected first priority security interest (as defined in
Section 1-201(37) of the UCC) in the Equipment (except to the extent the
Equipment secures any loan that is cross-collateralized with such CEF
Asset) in favor of the applicable Seller as secured party or all necessary
and appropriate actions have been commenced that would result in the valid
perfection of a first priority security interest in the Equipment in favor
of such Seller as secured party.
(vii) CEF Assets in Force. No CEF Asset has been satisfied,
subordinated or rescinded, nor has any Equipment been released from the
Lien granted by the related CEF Asset in whole or in part.
(viii) No Amendment or Waiver. No provision of a CEF Asset has been
waived, altered or modified in any respect, except pursuant to a document,
instrument or writing included in the Loan Files and no such amendment,
waiver, alteration or modification causes such CEF Asset not to be an
Eligible Loan.
(ix) No Defenses. No right of rescission, setoff, counterclaim or
defense has been asserted or threatened or exists with respect to any CEF
Asset.
Annex A to
Loan Sale Agreement
3
(x) Lawful Assignment. No CEF Asset has been originated in, or is
subject to the laws of, any jurisdiction under which the sale, transfer
and assignment of such CEF Asset or any CEF Asset under the Loan Sale
Agreement would be unlawful.
(xi) All Filings Made. All filings (including UCC filings) necessary
in any jurisdiction to give Purchaser a first priority perfected ownership
interest in the CEF Asset have been made (except to the extent the
Equipment secures any loan that is cross-collateralized with such CEF
Asset).
(xii) One Original. There is only one original executed copy of each
CEF Asset.
(xiii) Insurance. The Obligor on each CEF Asset is required to
maintain physical damage insurance covering the Equipment in accordance
with GE Capital's normal requirements.
(xiv) No Bankruptcies. No Obligor on any CEF Asset as of the Cutoff
Date was noted in the related Loan File as being the subject of a
bankruptcy proceeding.
(xv) No Repossessions. None of the Equipment securing any CEF Asset
is in repossession status.
(xvi) Instrument or Chattel Paper. Each CEF Asset constitutes an
"instrument" or "chattel paper" as defined in the UCC of each State the
law of which governs the perfection of the interest granted in it and/or
the priority of such perfected interest.
(xvii) U.S. Obligors. None of the CEF Assets is denominated and
payable in any currency other than United States Dollars or is due from
any Person that does not have a mailing address in the United States of
America.
(xviii) No Delinquent Loan. None of the CEF Assets is more than 30
days past due.
(xix) No Consumer Contract. None of the CEF Assets constitutes a
Consumer Contract.
(xx) Finance Lease. With respect to each CEF Asset that is in form a
lease rather than a secured loan, the terms of such CEF Asset provides
that it is non-cancelable and that, by the end of the lease term, the
lessee may elect to purchase the related Equipment upon the exercise of a
nominal purchase option that satisfies Section 1-201(37)(a)(iv) of the
UCC.
"Equipment" means any transportation equipment, industrial equipment,
furniture and fixtures, construction equipment, medical and dental equipment,
technology and telecommunications equipment, maritime assets or other equipment,
together with all accessions thereto securing an Obligor's indebtedness under
the respective Loan.
"Event of Default" is defined in Section 5.1 of the Indenture.
Annex A to
Loan Sale Agreement
4
"Federal Reserve Board" means the Board of Governors of the Federal
Reserve System.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect on the Closing Date, modified by Accounting Changes as
GAAP is further defined in Section 2(a) of this Annex A.
"GE Capital" is defined in the preamble of the Sale Agreement.
"GECS" means General Electric Capital Services, Inc., a Delaware
corporation or any successors or assigns thereto.
"GECT" is defined in the preamble of the Sale Agreement.
"Governmental Authority" means any nation or government, any state,
county, city, town, district, board, bureau, office, commission, any other
municipality or other political subdivision thereof (including any educational
facility, utility or other Person operated thereby), and any agency, department
or other entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Indemnified Amounts" means, with respect to any Person, any and all
suits, actions, proceedings, claims, damages, losses, liabilities and expenses
(including reasonable attorneys' fees and disbursements and other costs of
investigation or defense, including those incurred upon any appeal).
"Indenture" means the Indenture, dated November 16, 2004, between the
Issuer and the Indenture Trustee, as the same may be amended and supplemented
from time to time.
"Indenture Trustee" means JPMorgan Chase Bank, N.A., not in its individual
capacity but solely as Indenture Trustee under the Indenture, or any successor
Indenture Trustee under the Indenture.
"Investment Company Act" means the provisions of the Investment Company
Act of 1940, 15 U.S.C. Sections 80a et seq., and any regulations promulgated
thereunder.
"Issuer" means GE Commercial Equipment Financing LLC Series 2004-1, a
Delaware limited liability company, until a successor replaces it and,
thereafter, means the successor and, for purposes of any provision contained in
the Indenture and required by the Trust Indenture Act of 1939, each other
obligor on the Notes.
"Issuer Limited Liability Company Agreement" means the Limited Liability
Company Agreement of the Issuer, dated as of November 16, 2004, among the
Managing Member and the Issuer, as the same may be amended or supplemented from
time to time.
"Lien" means a security interest (as such term is defined in Section 1-201
of Article 1 of the UCC), lien, charge, pledge, equity or encumbrance of any
kind, other than tax liens, mechanics' liens and any liens that attach to the
related Loan by operation of law as a result of any act or omission by the
related Obligor.
Annex A to
Loan Sale Agreement
5
"Liquidated Loan" means any Loan (i) liquidated through the sale or other
disposition of all or a portion of the related Equipment, (ii) that has been
charged off in accordance with the Credit and Collection Policy without
realizing upon the Equipment or (iii) the due date of any Scheduled Payment of
which has been extended, at any time after the Cut-off Date for an aggregate
period of 12 or more calendar months.
"Liquidation Proceeds" means, with respect to any Liquidated Loan, the
amounts collected in respect thereof from whatever source (including the
proceeds of insurance policies with respect to the related Equipment or Obligor)
during the Collection Period in which it became a Liquidated Loan, net of the
sum of any amounts expended in connection with such liquidation and any amounts
required by law to be remitted to the Obligor on such Liquidated Loan or any
creditor of such Obligor to the extent required by applicable law or agreement.
"Litigation" means, with respect to any Person, any action, claim,
lawsuit, demand, investigation or proceeding pending or threatened against such
Person before any court, board, commission, agency or instrumentality of any
federal, state, local or foreign government or of any agency or subdivision
thereof or before any arbitrator or panel of arbitrators.
"Loan" means any Loan included in Schedules of Loans and any agreement
(including any invoice) pursuant to, or under which, an Obligor shall be
obligated to make payments with respect to any Loan.
"Loan Files" is defined in Section 2.1 of the Sale Agreement.
"Loan Value" is defined in the Purchase and Sale Agreement.
"Managing Member" means CEF Equipment Holding, L.L.C., a Delaware limited
liability company or any successor Managing Member under the Issuer Limited
Liability Company Agreement.
"Material Adverse Effect" means, with respect to any Person, a material
adverse effect on (a) the business, assets, liabilities, operations, prospects
or financial or other condition of such Person, (b) the ability of such Person
to perform any of its obligations under the Related Documents in accordance with
the terms thereof, (c) the validity or enforceability of any Related Document or
the rights and remedies of such Person under any Related Document or (d) the
Loans, as applicable, therefor, any interest related thereto or the ownership
interests or Liens of such Person thereon or the priority of such interests or
Liens.
"Note Depository Agreement" means the agreement among the Issuer, the
Indenture Trustee and The Depository Trust Company, as the initial clearing
agency, dated as of the Closing Date.
"Notes" means the notes issued under the Indenture.
"Obligor" means, as to each Loan, any Person who owes payments under the
Loan.
Annex A to
Loan Sale Agreement
6
"Payment Date" means, with respect to each Collection Period, the 20th day
of the calendar month following the end of that Collection Period, or, if such
day is not a Business Day, the next Business Day, commencing on December 20,
2004.
"Permitted Encumbrances" means the following encumbrances: (a) Liens for
taxes or assessments or other governmental charges not yet due and payable; (b)
pledges or deposits securing obligations under workmen's compensation,
unemployment insurance, social security or public liability laws or similar
legislation; (c) pledges or deposits securing bids, tenders, contracts (other
than contracts for the payment of money) or leases to which a Seller or any
Affiliate thereof is a party as lessee made in the ordinary course of business;
(d) deposits securing statutory obligations of a Seller or any Affiliate
thereof; (e) inchoate and unperfected workers', mechanics', suppliers' or
similar Liens arising in the ordinary course of business; (f) carriers',
warehousemen's or other similar possessory Liens arising in the ordinary course
of business and securing liabilities in an outstanding aggregate amount not in
excess of $100,000 at any one time; (g) deposits securing, or in lieu of,
surety, appeal or customs bonds in proceedings to which a Seller or any
Affiliate thereof is a party; (h) any attachment or judgment Lien not
constituting an Event of Default; (i) presently existing or hereinafter created
Liens in favor of the Purchaser, the Issuer or the Indenture Trustee; and (j)
presently existing or hereinafter created Liens on personal property or
Equipment which are subordinate to or pari passu with the Liens in favor of the
Purchaser, the Issuer or the Indenture Trustee.
"Person" means any individual, sole proprietorship, partnership, joint
venture, unincorporated organization, trust, association, corporation (including
a business trust), limited liability company, institution, public benefit
corporation, joint stock company, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Precomputed Loan" means any Loan under which the portion of a payment
allocable to earned interest (which may be referred to in the related Loan as an
add-on finance charge) and the portion allocable to principal are determined
according to the sum of periodic balances, the sum of monthly payments or any
equivalent method or are monthly actuarial loans.
"Purchase Amount" means, as of the close of business on the last day of a
Collection Period, an amount equal to the Loan Value of the applicable Loan, as
of the first day of the immediately following Collection Period (or, with
respect to any applicable Loan that is a Liquidated Loan, as of the day
immediately prior to such Loan becoming a Liquidated Loan less any Liquidation
Proceeds actually received by the Issuer) plus interest accrued and unpaid
thereon as of such last day at a rate per annum equal to the APR for such Loan.
"Purchase and Sale Agreement" means the Loan Purchase and Sale Agreement
dated as of November 16, 2004, by and between the Transferor and the Issuer as
the same may be amended from time to time.
"Purchaser" is defined in the preamble to the Sale Agreement.
"Purchaser Indemnified Person" is defined in Section 5.1 of the Sale
Agreement.
"Records" means all notes, leases, security agreements and other
documents, books, records and other information (including computer programs,
tapes, disks, data processing
Annex A to
Loan Sale Agreement
7
software and related property and rights) prepared and maintained by any Seller,
the Servicer, any Sub-Servicer or the Issuer with respect to the Loans and the
Obligors thereunder, and the other CEF Assets.
"Recoveries" means, with respect to any Liquidated Loan, monies collected
in respect thereof, from whatever source (other than from the sale or other
disposition of the Equipment), in any Collection Period after such Loan became a
Liquidated Loan.
"Redemption Date" is defined in the Indenture.
"Related Documents" means the Sale Agreement, the Purchase and Sale
Agreement, the Servicing Agreement, the Issuer Limited Liability Company
Agreement, the CEF Limited Liability Company Agreement, the Administration
Agreement, the Note Depository Agreement, the Swap Agreement, and all other
agreements, instruments, and documents and including all other pledges, powers
of attorney, consents, assignments, contracts, notices, and all other written
matter whether heretofore, now or hereafter executed by or on behalf of any
Person, or any employee of any Person, and delivered in connection with any of
the foregoing. Any reference in the foregoing documents to a Related Document
shall include all Appendices thereto, and all amendments, restatements,
supplements or other modifications thereto, and shall refer to such Related
Document as the same may be in effect at any and all times such reference
becomes operative.
"Related Security" means with respect to any Loan: (a) any interest
(including security interests), if any, in the related Equipment; (b) all
guarantees, insurance or other agreements or arrangements of any kind from time
to time supporting or securing payment of such Loan (including rights (if any)
to receive proceeds on insurance policies covering the Obligors); and (c) all
Records relating to such Loan.
"Sale Agreement" means the Loan Sale Agreement, dated November 16, 2004,
among GE Capital, GECT and the Purchaser, as the same may be amended or
supplemented from time to time.
"Scheduled Payment" on a Loan means that portion of the payment required
to be made by the Obligor during any Collection Period sufficient to amortize
the principal balance under (x) in the case of a Precomputed Loan, the actuarial
method or (y) in the case of a Simple Interest Loan, the simple interest method,
in each case, over the term of the Loan and to provide interest at the APR,
provided that Termination Values shall also constitute Scheduled Payments.
"Schedules of Loans" means the schedules of Loans attached as Schedule I
and Schedule II to the Sale Agreement (which schedules may be in the form of
microfiche).
"Securities Act" means the provisions of the Securities Act of 1933, 15
U.S.C. Sections 77a et seq., and any regulations promulgated thereunder.
"Securities Exchange Act" means the provisions of the Securities Exchange
Act of 1934, 15 U.S.C. Sections 78a et seq., and any regulations promulgated
thereunder.
Annex A to
Loan Sale Agreement
8
"Seller" means GE Capital and GECT, each in its capacity as a seller
hereunder, their respective successors and assigns.
"Servicer" means General Electric Capital Corporation in its capacity as
Servicer under the Servicing Agreement, or any other Person designated as a
Successor Servicer under such agreement.
"Servicing Agreement" means the Servicing Agreement dated as of November
16, 2004, by and between the Issuer and the Servicer, as the same may be amended
or supplemented from time to time.
"Servicing Fee" is defined in the Servicing Agreement.
"Simple Interest Loan" means any Loan under which the portion of a payment
allocable to interest and the portion allocable to principal is determined by
allocating a fixed level payment between principal and interest, such that such
payment is allocated first to the accrued and unpaid interest at the Annual
Percentage Rate for such Loan on the unpaid principal balance and the remainder
of such payment is allocable to principal.
"Solvent" means, with respect to any Person on a particular date, that on
such date (a) the fair value of the property of such Person is greater than the
total amount of liabilities, including contingent liabilities, of such Person;
(b) the present fair salable value of the assets of such Person is not less than
the amount that will be required to pay the probable liability of such Person on
its debts as they become absolute and matured; (c) such Person does not intend
to, and does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature; and (d) such
Person is not engaged in a business or transaction, and is not about to engage
in a business or transaction, for which such Person's property would constitute
an unreasonably small capital. The amount of contingent liabilities (such as
Litigation, guaranties and pension plan liabilities) at any time shall be
computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that can reasonably be expected to
become an actual or matured liability.
"Stock" means all shares, options, warrants, membership interests in a
limited liability company, general or limited partnership interests or other
equivalents (regardless of how designated) of or in a corporation, partnership
or equivalent entity whether voting or nonvoting, including common stock,
preferred stock or any other "equity security" (as such term is defined in Rule
3a11-1 of the General Rules and Regulations promulgated by the Securities and
Exchange Commission under the Securities Exchange Act).
"Stockholder" means, with respect to any Person, each holder of Stock of
such Person.
"Sub-Servicer" means any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
"Sub-Servicing Agreement" means any written contract entered into between
a Servicer and any Sub-Servicer pursuant to and in accordance with the Servicing
Agreement.
Annex A to
Loan Sale Agreement
9
"Subsidiary" means, with respect to any Person, any corporation or other
entity (a) of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other Persons
performing similar functions are at the time directly or indirectly owned by
such Person or (b) that is directly or indirectly controlled by such Person
within the meaning of control under Section 15 of the Securities Act.
"Successor Servicer" is defined in Section 6.2 of the Servicing Agreement.
"Swap Agreement" is defined in the Indenture.
"Termination Value" means the "Termination Value" (if any) payable by
lessee pursuant to the applicable Loan.
"Transfer Date" is defined in the Indenture.
"Transferor" means CEF Equipment Holding, L.L.C. a Delaware limited
liability company, as seller under the Purchase and Sale Agreement.
"UCC" means, with respect to any jurisdiction, the Uniform Commercial Code
as the same may, from time to time, be enacted and in effect in such
jurisdiction.
SECTION 2. Other Interpretive Matters. All terms defined directly or by
incorporation in the Sale Agreement shall have the defined meanings when used in
any certificate or other document delivered pursuant thereto unless otherwise
defined therein. For purposes of the Sale Agreement (including in this Annex A)
and all related certificates and other documents, unless the context otherwise
requires: (a) accounting terms not otherwise defined in such Agreement, and
accounting terms partly defined in such Agreement to the extent not defined,
shall have the respective meanings given to them under generally accepted
accounting principles; and unless otherwise provided, references to any month,
quarter or year refer to a fiscal month, quarter or year as determined in
accordance with the GE Capital fiscal calendar; (b) terms defined in Article 9
of the UCC and not otherwise defined in such Agreement are used as defined in
that Article; (c) references to any amount as on deposit or outstanding on any
particular date means such amount at the close of business on such day; (d) the
words "hereof," "herein" and "hereunder" and words of similar import refer to
such Agreement (or the certificate or other document in which they are used) as
a whole and not to any particular provision of such Agreement (or such
certificate or document); (e) references to any Section, Schedule or Exhibit are
references to Sections, Schedules and Exhibits in or to such Agreement (or the
certificate or other document in which the reference is made), and references to
any paragraph, subsection, clause or other subdivision within any Section or
definition refer to such paragraph, subsection, clause or other subdivision of
such Section or definition; (f) the term "including" means "including without
limitation"; (g) references to any law or regulation refer to that law or
regulation as amended from time to time and include any successor law or
regulation; (h) references to any agreement refer to that agreement as from time
to time amended, restated or supplemented or as the terms of such agreement are
waived or modified in accordance with its terms; (i) references to any Person
include that Person's successors and assigns; and (j) headings are for purposes
of reference only and shall not otherwise affect the meaning or interpretation
of any provision hereof.
Annex A to
Loan Sale Agreement
10
EXHIBIT 4(d)
EXECUTION VERSION
LOAN PURCHASE AND SALE AGREEMENT
Dated as of November 16, 2004
between
CEF EQUIPMENT HOLDING, L.L.C.,
as Seller
and
GE COMMERCIAL EQUIPMENT
FINANCING LLC, SERIES 2004-1,
as Purchaser
Loan Purchase
and Sale Agreement
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions..................................................... 1
Section 1.2 Rules of Construction........................................... 1
ARTICLE II
SALES OF PURCHASER ASSETS
Section 2.1 Sale of Loans................................................... 1
Section 2.2 Grant of Security Interest...................................... 2
Section 2.3 Sale Price...................................................... 2
Section 2.4 Removal of Loans................................................ 2
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 Conditions to Sale.............................................. 3
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1 Representations and Warranties of the Seller.................... 4
Section 4.2 Affirmative Covenants of the Seller............................. 6
Section 4.3 Negative Covenants of the Seller................................ 7
ARTICLE V
INDEMNIFICATION
Section 5.1 Indemnification................................................. 8
ARTICLE VI
CLEAN-UP CALL
Section 6.1 Clean-up Call................................................... 8
ARTICLE VII
MISCELLANEOUS
Section 7.1 Notices......................................................... 9
Section 7.2 No Waiver; Remedies............................................. 10
Section 7.3 Successors and Assigns.......................................... 10
Section 7.4 Termination; Survival of Obligations............................ 10
Section 7.5 Complete Agreement; Modification of Agreement................... 11
Section 7.6 Amendments and Waivers.......................................... 11
Section 7.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.... 11
Section 7.8 Counterparts.................................................... 12
Section 7.9 Severability.................................................... 13
Section 7.10 Section Titles.................................................. 13
-i-
TABLE OF CONTENTS
(continued)
PAGE
Section 7.11 No Setoff....................................................... 13
Section 7.12 Confidentiality................................................. 13
Section 7.13 Further Assurances.............................................. 13
Section 7.14 Accounting Changes.............................................. 13
Schedule 4.1(b) UCC Information
Schedule I Schedule of CEF Loans
Exhibit 4.2(f) Separate Indemnity Provisions
Annex A Definitions and Interpretations
-ii-
This LOAN PURCHASE AND SALE AGREEMENT ("Agreement" or "Purchase and Sale
Agreement") is entered into as of November 16, 2004, by and between CEF
EQUIPMENT HOLDING, L.L.C. (the "Seller"), a Delaware limited liability company
and GE COMMERCIAL EQUIPMENT FINANCING LLC, SERIES 2004-1, a Delaware limited
liability company (the "Purchaser").
In consideration of the premises and the mutual covenants hereinafter
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.1 Definitions. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in Section 1 of Annex A to this
Agreement.
Section 1.2 Rules of Construction. For purposes of this Agreement, the
rules of construction set forth in Section 2 of Annex A shall govern. All
Annexes, Exhibits and Schedules hereto, are incorporated herein by reference
and, taken together with this Agreement, shall constitute but a single
agreement.
ARTICLE II
SALES OF PURCHASER ASSETS
Section 2.1 Sale of Loans. (a) Subject to the terms and conditions hereof,
the Seller does hereby sell, transfer, assign, set over and otherwise convey to
the Purchaser, without recourse (subject to the obligations herein) all right,
title and interest of the Seller in:
(i) the Loans, including the Loan Files, and all obligations of
the Obligors thereunder, including the right to payment of any
interest accrued and to accrue from and after November 1, 2004
or finance charges and other obligations of such Obligor with
respect thereto due or to become due on or after the Cutoff
Date;
(ii) all Related Security and Collections with respect thereto;
(iii) the Loan Sale Agreement;
(iv) all other property now or hereafter in the possession or
custody of, or in transit to, the Servicer, any Sub-Servicer
or the Seller relating to any of the foregoing;
(v) all Records with respect to any of the foregoing; and
(vi) all proceeds of the foregoing (collectively the "Purchaser
Assets").
Loan Purchase
and Sale Agreement
(b) On or before the Closing Date, the Seller shall (i) indicate in
its computer files that the Purchaser Assets have been sold to the
Purchaser pursuant to this Agreement by so identifying the Purchaser
Assets with an appropriate notation and (ii) deliver to the Purchaser or
its designee the following documents (collectively, the "Loan Files"):
(i) the original fully executed copy of the Loan;
(ii) a record or facsimile of the original credit application fully
executed by the Obligor;
(iii) the original certificate of title or file stamped copy of the
UCC financing statement or such other documents evidencing the
security interest of the Purchaser in the Equipment; and
(iv) any and all other documents relating to a Loan, an Obligor or
any of the Equipment.
Section 2.2 Grant of Security Interest. The parties hereto intend that the
sale pursuant to Section 2.1 hereof shall constitute a purchase and sale and not
a loan. Notwithstanding anything to the contrary set forth in this Section 2.2,
if a court of competent jurisdiction determines that the sale provided for
herein constitutes a loan and not a purchase and sale, then the parties hereto
intend that this Agreement shall constitute a security agreement under
applicable law and that the Seller shall be deemed to have granted, and the
Seller hereby grants, to the Purchaser a first priority lien and security
interest in and to all of the Seller's right, title and interest in, to and
under the Purchaser Assets. The possession by the Purchaser of notes and such
other goods, money, documents, chattel paper or certificated securities shall be
deemed to be "possession by the secured party" for purposes of perfecting the
security interest pursuant to the Uniform Commercial Code in force in the
relevant jurisdiction (including, without limitation, Section 9-313(c)(1)
thereof). Notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, bailees or
agents (as applicable) of the Purchaser for the purpose of perfecting such
security interest under applicable law (except that nothing in this sentence
shall cause any Person to be deemed to be an agent of the Purchaser for any
purpose other than for perfection of such security interest unless, and then
only to the extent, expressly appointed and authorized by the Purchaser in
writing).
Section 2.3 Sale Price. On the Closing Date, the Purchaser shall, upon
satisfaction of the applicable conditions set forth in Article III, issue and
exchange the Notes (the "Purchaser Purchase Price") as consideration for the
Purchaser Assets sold and transferred by the Seller to the Purchaser pursuant to
Section 2.1 hereof.
Section 2.4 Removal of Loans. (a) In the event a Loan becomes a Delinquent
Loan or the Obligor thereon is subject to a bankruptcy proceeding, the Seller
shall be granted an assignable option (a "Purchase Option") to purchase such
Delinquent Loan from the Purchaser at a price (the "Option Price") equal to the
Purchase Amount. The Seller may sell, transfer, assign or otherwise convey its
Purchase Option with respect to any such Loan to any party at any time after the
related Loan becomes a Delinquent Loan or the Obligor thereon is subject to a
Loan Purchase and Sale Agreement
2
bankruptcy proceeding. The Seller shall notify the Purchaser of such transfer
and such notice shall include the transferee's name, address, telephone number,
facsimile number and appropriate contact person(s) and shall be acknowledged in
writing by the transferee. If not exercised earlier, the Purchase Option with
respect to any such Loan shall automatically terminate upon (i) in the case of a
Delinquent Loan, the related Obligor's cure of all defaults on the Loan, (ii)
the acquisition by, or on behalf of, the Issuer of the related Equipment through
repossession, (iii) upon a repurchase of a Loan due to the Seller's breach of a
representation with respect to such Loan or (iv) on the Business Day immediately
preceding the last day of the calendar quarter ending at least ten (10) days
after such Loan became a Defaulted Loan. The aggregate Outstanding Principal
Balance of Loans with respect to which the Seller may exercise its Purchase
Option at any time before the Redemption Date shall not exceed 10% of the
aggregate Outstanding Principal Balance of the Loans as of the Cutoff Date.
(b) Upon a Loan becoming a Delinquent Loan or the Obligor thereon
becoming subject to a bankruptcy proceeding, the Seller may exercise the
Purchase Option by providing the Purchaser at least five days prior
written notice thereof (the "Purchase Option Notice"), which notice shall
specify a cash exercise price at least equal to the Option Price. The
Purchase Option Notice shall be delivered in the manner specified in
Section 2.4(a). The exercise of any Purchase Option pursuant to this
clause (b) shall be irrevocable.
(c) Upon exercise of a Purchase Option, the Seller shall be required
to pay the Option Price specified in its Purchase Option Notice to the
Purchaser within 10 Business Days of exercising its Purchase Option. The
proceeds of any sale of such Loan, after deduction of the expenses of such
sale incurred in connection therewith, shall be deposited by the Seller no
later than the day before the next Payment Date.
ARTICLE III
CONDITIONS PRECEDENT
Section 3.1 Conditions to Sale. The sale hereunder shall be subject to
satisfaction of each of the following conditions precedent (any one or more of
which, except clause (e) below, may be waived in writing by the Purchaser) as of
the Closing Date:
(a) This Agreement or counterparts hereof shall have been duly
executed by, and delivered to, the Seller and the Purchaser, and the
Purchaser shall have received such documents, instruments, agreements and
legal opinions as the Purchaser shall reasonably request in connection
with the transactions contemplated by this Agreement, each in form and
substance reasonably satisfactory to the Purchaser.
(b) The Purchaser shall have received satisfactory evidence that the
Seller has obtained all required consents and approvals of all Persons,
including all requisite Governmental Authorities, to the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby.
Loan Purchase and Sale Agreement
3
(c) The Seller shall be in compliance in all material respects with
all applicable foreign, federal, state and local laws and regulations,
including those specifically referenced in Section 4.2(c), except to the
extent that the failure to so comply, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.
(d) The representations and warranties of the Seller contained
herein or in any other Related Document shall be true and correct in all
material respects (or, to the extent any such representation or warranty
is qualified by a materiality standard, such representation or warranty
shall be true and correct) as of the Closing Date, both before and after
giving effect to such sale, except to the extent that any such
representation or warranty expressly relates to an earlier date and except
for changes therein expressly permitted by this Agreement.
(e) The Seller shall be in compliance with each of its covenants and
other agreements set forth herein.
(f) The Seller shall have taken such other action, including
delivery of approvals, consents, opinions, documents and instruments to
the Purchaser as the Purchaser may reasonably request.
The consummation by the Seller of the sale of Purchaser Assets on the Closing
Date shall be deemed to constitute, as of the Closing Date, a representation and
warranty by the Seller that the conditions in clauses (d), (e) and (f) of this
Section 3.1 have been satisfied.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
Section 4.1 Representations and Warranties of the Seller. To induce the
Purchaser to purchase the Purchaser Assets, the Seller makes the following
representations and warranties to the Purchaser, as of the Closing Date, each
and all of which shall survive the execution and delivery of this Agreement.
(a) Valid Existence; Power and Authority. The Seller (i) is a
limited liability company duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; and (ii) has
all requisite power, authority and licenses to conduct its business, to
own its properties and to execute, deliver and perform its obligations
under this Agreement.
(b) UCC Information. The true legal name of the Seller as registered
in the jurisdiction of its organization, and the current location of the
Seller's jurisdiction of organization are set forth in Schedule 4.1(b) and
such location has not changed within the past 12 months. During the prior
five years, except as set forth in Schedule 4.1(b), the Seller has not
been known as or used any limited liability company, fictitious or trade
name. In addition, Schedule 4.1(b) lists the Seller's (i) federal employer
identification number and (ii) organizational identification number as
designated by the jurisdiction of its organization.
Loan Purchase and Sale Agreement
4
(c) Power, Authorization, Enforceable Obligations. The execution,
delivery and performance by the Seller of this Agreement and the other
Related Documents and the creation and perfection of all Liens and
ownership interests provided for herein: (i) have been duly authorized by
all necessary action, and (ii) do not violate any provision of any law or
regulation of any Governmental Authority, or contractual or other
restrictions, binding on the Seller, except where such violations,
individually or in the aggregate, could not reasonably be expected to have
a Material Adverse Effect.
(d) Enforceability. On or prior to the Closing Date, each of the
Related Documents to which the Seller is a party shall have been duly
executed and delivered by the Seller and each such Related Document shall
then constitute a legal, valid and binding obligation of the Seller
enforceable against it in accordance with its terms, subject as to
enforcement to bankruptcy, receivership, conservatorship, insolvency,
reorganization, moratorium and other similar laws of general applicability
relating to or affecting creditors' rights and to general principles of
equity.
(e) Solvency. The Seller is Solvent.
(f) Use of Proceeds. No proceeds received by the Seller under this
Agreement will be used by it for any purpose that violates Regulation U of
the Federal Reserve Board.
(g) Investment Company Act. The Seller is not an "investment
company" or "controlled by" an "investment company," as such terms are
defined in the Investment Company Act.
(h) Loans and Other Purchaser Assets. With respect to each Loan and
the other Purchaser Assets sold by the Seller on the Closing Date, the
Seller represents and warrants that (i) such Loan satisfies the criteria
for an Eligible Loan as of the Cut-Off Date; and (ii) immediately prior to
its sale to the Purchaser, such Purchaser Assets were owned by the Seller
free and clear of any Adverse Claim, and the Seller has had at all
relevant times the full right, power and authority to sell, contribute,
assign, transfer and pledge its interest therein as contemplated under
this Agreement and, upon such sale, the Purchaser will acquire valid and
properly perfected title to, and the sole record and beneficial ownership
interest in, such Purchaser Assets, free and clear of any Adverse Claim or
restrictions on transferability, and the Liens granted to the Purchaser by
the Seller pursuant to Section 2.2 will at all times be fully perfected
first priority Liens in and to such Loans and, in addition, following such
sale, such Loan will not be subject to any Adverse Claim as a result of
any action or inaction on the part of the Seller (or any predecessor in
interest).
The representations and warranties described in this Section 4.1 shall survive
the sale of the Purchaser Assets to the Purchaser, any subsequent assignment or
sale of the Purchaser Assets by the Purchaser, and the termination of this
Agreement and the other Related Documents and shall continue until the payment
in full of all Purchaser Assets.
Loan Purchase and Sale Agreement
5
Section 4.2 Affirmative Covenants of the Seller. The Seller covenants and
agrees that, unless otherwise consented to by the Purchaser, from and after the
Closing Date:
(a) Records. The Seller shall at its own cost and expense, for not
less than three years from the date on which each Loan was originated, or
for such longer period as may be required by law, maintain adequate
Records with respect to such Loan, including records of all payments
received, credits granted and merchandise returned with respect thereto.
(b) Access. At any reasonable time, and from time to time at the
Purchaser's reasonable request, and upon at least seven days prior notice
to the Seller, the Seller shall permit the Purchaser (or such Person as
the Purchaser may designate), at the expense of the Purchaser (or such
Person as the Purchaser may designate), to conduct audits or visit and
inspect any of the properties of the Seller to examine the records,
internal controls and procedures maintained by the Seller with respect to
the Purchaser Assets and take copies and extracts therefrom, and to
discuss the Seller's affairs with its officers, employees and, upon notice
to the Seller, independent accountants. The Seller shall authorize such
officers, employees and independent accountants to discuss with the
Purchaser (or such Person as the Purchaser may designate) the affairs of
the Seller as such affairs relate to the Purchaser Assets. Any audit
provided for herein shall be conducted in accordance with the Seller's
rules respecting safety and security on its premises and without
materially disrupting operations. If an Event of Default shall have
occurred and be continuing, the Seller shall provide such access at all
times and without advance notice and shall provide the Purchaser (or such
Person as the Purchaser may designate) with access to its suppliers and
customers.
(c) Compliance With Agreements and Applicable Laws. The Seller shall
comply with all federal, state and local laws and regulations applicable
to it and the Purchaser Assets, including those relating to truth in
lending, fair credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices, privacy, licensing and
taxation, except to the extent that the failure to so comply, individually
or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
(d) Maintenance of Existence and Conduct of Business. The Seller
shall preserve and maintain its legal existence, rights, franchise and
privileges in the jurisdiction of its formation.
(e) Notice of Material Event. The Seller shall promptly inform the
Purchaser in writing of the occurrence of any of the following, in each
case setting forth the details thereof and what action, if any, the Seller
proposes to take with respect thereto:
(i) any Litigation commenced or, to the knowledge of the Seller,
threatened against the Seller or with respect to or in
connection with all or any substantial portion of the
Purchaser Assets or developments in such Litigation in each
case that the Seller believes has a reasonable risk of being
determined adversely to the Seller and that could, if
determined adversely, have a Material Adverse Effect; or
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(ii) the commencement of a case or proceeding by or against the
Seller seeking a decree or order in respect of the Seller (A)
under the Bankruptcy Code or any other applicable federal,
state or foreign bankruptcy or other similar law, (B)
appointing a custodian, receiver, liquidator, assignee,
trustee or sequestrator (or similar official) for the Seller
or for any substantial part of Seller's assets, or (C)
ordering the winding-up or liquidation of the affairs of the
Seller.
(f) Separate Identity. The Seller shall, to the extent applicable to
it, act in a manner that is consistent with the statements set forth in
Exhibit 4.2(f).
(g) Deposit of Collections. The Seller shall transfer and cause its
Subsidiaries to transfer to the Purchaser or the Servicer on its behalf,
promptly, and in any event no later than the second Business Day after
receipt thereof, all Collections it may receive in respect of Purchaser
Assets.
(h) Sale Characterization. For accounting purposes, the Seller shall
treat the sale made hereunder as a sale of the Purchaser Assets. The
Seller shall also maintain its accounting books and records in a manner
which clearly reflects such sale of the Purchaser Assets to the Purchaser.
Section 4.3 Negative Covenants of the Seller. The Seller covenants and
agrees that, without the prior written consent of the Purchaser, from and after
the Closing Date and until the later of the Redemption Date or the Class C
Maturity Date:
(a) Adverse Claims. The Seller shall not create, incur, assume or
permit to exist any Adverse Claim on or with respect to any Purchaser
Assets.
(b) Modifications of Loans. The Seller shall not extend, amend,
forgive, discharge, compromise, cancel, waive or otherwise modify the
terms or conditions of any Loan except (i) as permitted under the
Servicing Agreement and, (ii) to the extent that such extension,
amendment, forgiveness, discharge, compromise, cancellation, waiver or
modification, does not affect the Purchaser's ownership interest in such
Loan and does not negatively impact the ultimate collectibility of such
Loan.
(c) UCC Matters. The Seller shall not change its state of formation
or its name, identity or limited liability company structure such that any
financing statement filed to perfect the Purchaser's interests under this
Agreement would become seriously misleading, unless the Seller shall have
given the Purchaser not less than 30 days' prior written notice of such
change.
(d) No Proceedings. From the Closing Date and until the date one
year plus one day following the date on which all amounts due with respect
to the Notes have been paid in full in cash, Seller shall not, directly or
indirectly, institute or cause to be instituted against the Purchaser any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or
similar law; provided that the foregoing shall not in any way limit the
Seller's right to
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pursue any other creditor rights or remedies that the Seller may have
under applicable law.
(e) Consolidations, Mergers and Sales of Assets. The Seller shall
not (i) consolidate or merge with or into any other Person unless the
Seller is the entity surviving such merger or (ii) sell, lease or
otherwise transfer all or substantially all of its assets to any other
Person.
ARTICLE V
INDEMNIFICATION
Section 5.1 Indemnification. Without limiting any other rights that the
Purchaser or any of its Stockholders, officers, directors, employees, attorneys,
agents or representatives (each, a "Purchaser Indemnified Person") may have
hereunder or under applicable law, the Seller hereby agrees to indemnify and
hold harmless each Purchaser Indemnified Person from and against any and all
Indemnified Amounts that may be claimed or asserted against or incurred by any
such Purchaser Indemnified Person to the extent arising from or related to the
failure of a Loan to be originated in compliance with all requirements of law;
provided, that the Seller shall not be liable for any indemnification to a
Purchaser Indemnified Person to the extent that any such Indemnified Amounts
result from (a) such Purchaser Indemnified Person's bad faith, gross negligence
or willful misconduct, (b) recourse for uncollectible Loans, or (c) any income
tax or franchise tax incurred by any Purchaser Indemnified Person, except to the
extent that the incurrence of any such tax results from a breach of or default
by the Seller under this Agreement.
NO PARTY TO THIS AGREEMENT SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO
THIS AGREEMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH
PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR
INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES THAT MAY BE ALLEGED AS A
RESULT OF ANY TRANSACTION CONTEMPLATED HEREUNDER.
ARTICLE VI
CLEAN-UP CALL
Section 6.1 Clean-up Call. As of the first day of any Collection Period
immediately preceding a Payment Date as of which the Pool Balance is 10% or less
of the Pool Balance as of the Cut-off Date, the Seller shall have the option to
purchase all of the Collateral, other than the Trust Accounts. To exercise such
option, the Seller shall pay to the Servicer, on behalf of the Issuer, and the
Servicer shall deposit in the Collection Account an amount equal to the
aggregate Purchase Amount for the Loans plus the appraised value of any such
other property held by the Purchaser, such value to be determined by an
appraiser mutually agreed upon by the Seller and the Purchaser, shall succeed to
all interests in, to and under the Collateral, other than the Trust Accounts.
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ARTICLE VII
MISCELLANEOUS
Section 7.1 Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by any other parties, or whenever any of the parties desires to give or
serve upon any other parties any communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and shall be deemed to have been validly
served, given or delivered (a) upon the earlier of actual receipt and three
Business Days after deposit in the United States mail, registered or certified
mail, return receipt requested, with proper postage prepaid, (b) upon
transmission, when sent by telecopy or other similar facsimile transmission
(with such telecopy or facsimile promptly confirmed by delivery of a copy by
personal delivery or United States mail as otherwise provided in this Section
7.1), (c) one Business Day after deposit with a reputable overnight courier with
all charges prepaid or (d) when delivered, if hand-delivered by messenger, all
of which shall be addressed to the party to be notified and sent to the address
or facsimile number set forth below or to such other address (or facsimile
number) as may be substituted by notice given as herein provided. The giving of
any notice required hereunder may be waived in writing by the party entitled to
receive such notice. Failure or delay in delivering copies of any notice,
demand, request, consent, approval, declaration or other communication to any
Person (other than Purchaser) designated in any written communication provided
hereunder to receive copies shall in no way adversely affect the effectiveness
of such notice, demand, request, consent, approval, declaration or other
communication. Notwithstanding the foregoing, whenever it is provided herein
that a notice is to be given to any other party hereto by a specific time, such
notice shall be effective only if actually received by such party prior to such
time, and if such notice is received after such time or on a day other than a
Business Day, such notice shall be effective only on the immediately succeeding
Business Day.
Attention: General Counsel
Telephone: (203) 796-5518
Facsimile: (203) 796-1310
If to Purchaser:
GE Commercial Equipment Financing LLC,
Series 2004-1
44 Old Ridgebury Road
Danbury, Connecticut 06810
Attention: Capital Markets Operations
Telephone: (203) 796-5518
Facsimile: (203) 796-5554
Loan Purchase and Sale Agreement
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Section 7.2 No Waiver; Remedies. (a) Either party's failure, at any time
or times, to require strict performance by the other party hereto of any
provision of this Agreement shall not waive, affect or diminish any right of
such party thereafter to demand strict compliance and performance herewith. Any
suspension or waiver of any breach or default hereunder shall not suspend, waive
or affect any other breach or default whether the same is prior or subsequent
thereto and whether of the same or a different type. None of the undertakings,
agreements, warranties, covenants and representations of either party contained
in this Agreement, and no breach or default by either party hereunder, shall be
deemed to have been suspended or waived by the other party hereto unless such
waiver or suspension is by an instrument in writing signed by an officer of or
other duly authorized signatory of such party and directed to the defaulting
party specifying such suspension or waiver.
(b) Upon discovery by the Seller or the Purchaser of any breach of
any representation, warranty, undertaking or covenant described in
Sections 4.1, 4.2 or 4.3, which breach is reasonably likely to have a
Material Adverse Effect, the party discovering the same shall give prompt
written notice thereof to the other party hereto. As liquidated damages,
the Purchaser shall, on the Transfer Date relating to the Collection
Period during which the breach is discovered, request the Seller to, and
the Seller shall pay to, or at the direction of, the Purchaser the
Purchase Amount for the applicable Purchaser Assets (measured at the end
of the Collection Period during which such breach is discovered). Upon
such payment, all rights, title and interest of the Purchaser in and to
such Purchaser Assets will be deemed to be automatically released without
the necessity of any further action by the Purchaser, the Seller or any
other party and such Purchaser Assets will become the property of the
Seller.
(c) Each party's rights and remedies under this Agreement shall be
cumulative and nonexclusive of any other rights and remedies that such
party may have under any other agreement, including the other Related
Documents, by operation of law or otherwise.
Section 7.3 Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the Seller and the Purchaser and their
respective successors and permitted assigns, except as otherwise provided
herein. The Seller may not assign, transfer, hypothecate or otherwise convey its
rights, benefits, obligations or duties hereunder without the prior express
written consent of the Purchaser. Any such purported assignment, transfer,
hypothecation or other conveyance by the Seller without the prior express
written consent of the Purchaser shall be void. The Seller acknowledges that
under the Indenture the Purchaser will assign its rights granted hereunder to
the Indenture Trustee, and upon such assignment, Indenture Trustee shall have,
to the extent of such assignment, all rights of the Purchaser hereunder and
Indenture Trustee may in turn transfer such rights. The terms and provisions of
this Agreement are for the purpose of defining the relative rights and
obligations of the Seller and the Purchaser with respect to the transactions
contemplated hereby and no Person shall be a third-party beneficiary of any of
the terms and provisions of this Agreement.
Section 7.4 Termination; Survival of Obligations. (a) This Agreement shall
create and constitute the continuing obligations of the parties hereto in
accordance with its terms, and shall
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remain in full force and effect until the earlier of (i) the Class C Maturity
Date or (ii) the Redemption Date.
(b) Except as otherwise expressly provided herein or in any other
Related Document, no termination or cancellation (regardless of cause or
procedure) of any commitment made by the Purchaser under this Agreement
shall in any way affect or impair the obligations, duties and liabilities
of the Seller or the rights of the Purchaser relating to any unpaid
portion of any and all recourse and indemnity obligations of the Seller to
the Purchaser, due or not due, liquidated, contingent or unliquidated or
any transaction or event occurring prior to such termination, or any
transaction or event, the performance of which is required after the Class
C Maturity Date. Except as otherwise expressly provided herein or in any
other Related Document, all undertakings, agreements, covenants,
warranties and representations of or binding upon the Seller, and all
rights of the Purchaser hereunder shall not terminate or expire, but
rather shall survive any such termination or cancellation and shall
continue in full force and effect until the earlier of (i) the Class C
Maturity Date or (ii) the Redemption Date; provided, that the rights and
remedies pursuant to Section 7.2(b), the indemnification and payment
provisions of Article V, and the provisions of Sections 4.3(e), 7.3 and
7.12 shall be continuing and shall survive any termination of this
Agreement.
Section 7.5 Complete Agreement; Modification of Agreement. This Agreement
constitutes the complete agreement between the parties with respect to the
subject matter hereof, supersedes all prior agreements and understandings
relating to the subject matter hereof and thereof, and may not be modified,
altered or amended except as set forth in Section 7.6.
Section 7.6 Amendments and Waivers. No amendment, modification,
termination or waiver of any provision of this Agreement, or any consent to any
departure therefrom by any party hereto, shall in any event be effective unless
the same shall be in writing and signed by each of the parties hereto. No
consent or demand in any case shall, in itself, entitle any party to any other
consent or further notice or demand in similar or other circumstances.
Section 7.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL IN ALL RESPECTS,
INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, BE GOVERNED BY,
AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
NEW YORK (WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS THEREOF EXCEPT
SECTION 5-1401 OF THE GENERAL OBLIGATION LAW) AND ANY APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA.
(b) EACH PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR
FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY SHALL
HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES
BETWEEN THEM PERTAINING TO THIS AGREEMENT OR TO ANY MATTER ARISING OUT OF
OR RELATING TO THIS AGREEMENT;
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PROVIDED, THAT EACH PARTY HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THOSE
COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE BOROUGH OF
MANHATTAN IN NEW YORK CITY; PROVIDED FURTHER, THAT NOTHING IN THIS
AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE THE PURCHASER FROM
BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO
REALIZE ON THE LOANS OR ANY SECURITY FOR THE OBLIGATIONS OF THE SELLER
ARISING HEREUNDER OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR
OF THE PURCHASER. EACH PARTY HERETO SUBMITS AND CONSENTS IN ADVANCE TO
SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND
EACH PARTY HERETO HEREBY WAIVES ANY OBJECTION THAT SUCH PARTY MAY HAVE
BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON
CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE
RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. EACH PARTY HERETO HEREBY
WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED
IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS,
COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO SUCH PARTY AT ITS ADDRESS DETERMINED IN ACCORDANCE WITH
SECTION 7.1 AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE
EARLIER OF SUCH PARTY'S ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT
IN THE UNITED STATES MAIL, PROPER POSTAGE PREPAID. NOTHING IN THIS SECTION
SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW.
(c) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED
AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS
TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE,
TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND
OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF, CONNECTED WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 7.8 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which shall collectively and separately
constitute one agreement.
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Section 7.9 Severability. Wherever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this Agreement.
Section 7.10 Section Titles. The section titles and table of contents
contained in this Agreement are provided for ease of reference only and shall be
without substantive meaning or content of any kind whatsoever and are not a part
of the agreement between the parties hereto.
Section 7.11 No Setoff. The Seller's obligations under this Agreement
shall not be affected by any right of setoff, counterclaim, recoupment, defense
or other right the Seller might have against the Purchaser, all of which rights
are hereby expressly waived by the Seller.
Section 7.12 Confidentiality. Notwithstanding anything herein to the
contrary, there is no restriction (express or implied) on any disclosure or
dissemination of the structure or tax aspects of the transaction contemplated by
the Related Documents. Furthermore, each party hereto acknowledges that it has
no proprietary rights to any tax matter or tax idea contemplated hereby or to
any element of the transaction structure contemplated hereby.
Section 7.13 Further Assurances. (a) The Seller shall, at its sole cost
and expense, upon request of the Purchaser, promptly and duly authorize, execute
and/or deliver, as applicable, any and all further instruments and documents and
take such further actions that may be necessary or desirable or that the
Purchaser may request to carry out more effectively the provisions and purposes
of this Agreement or to obtain the full benefits of this Agreement and of the
rights and powers herein granted, including authorizing and filing any financing
or continuation statements under the UCC with respect to the ownership interests
or Liens granted hereunder. The Seller hereby authorizes the Purchaser to file
any such financing or continuation statements without the signature of the
Seller to the extent permitted by applicable law. A carbon, photographic or
other reproduction of this Agreement or of any notice or financing statement
covering the Purchaser Assets or any part thereof shall be sufficient as a
notice or financing statement where permitted by law. If any amount payable
under or in connection with any of the Purchaser Assets is or shall become
evidenced by any instrument, such instrument, other than checks and notes
received in the ordinary course of business, shall be duly endorsed in a manner
satisfactory to the Purchaser immediately upon the Seller's receipt thereof and
promptly delivered to or at the direction of the Purchaser.
(b) If the Seller fails to perform any agreement or obligation under this
Section 7.13, the Purchaser may (but shall not be required to) itself perform,
or cause performance of, such agreement or obligation, and the reasonable
expenses of the Purchaser incurred in connection therewith shall be payable by
the Seller upon demand of the Purchaser.
Section 7.14 Accounting Changes. If any Accounting Changes occur and such
changes result in a change in the standards or terms used herein, then the
parties hereto agree to enter into negotiations in order to amend such
provisions so as to equitably reflect such Accounting Changes with the desired
result that the criteria for evaluating the financial condition of such Persons
and their Subsidiaries shall be the same after such Accounting Changes as if
such
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Accounting Changes had not been made. If the parties hereto agree upon the
required amendments to this Agreement, then after appropriate amendments have
been executed and the underlying Accounting Change with respect thereto has been
implemented, any reference to GAAP contained herein shall, only to the extent of
such Accounting Change, refer to GAAP consistently applied after giving effect
to the implementation of such Accounting Change. If such parties cannot agree
upon the required amendments within 30 days following the date of implementation
of any Accounting Change, then all financial statements delivered and all
standards and terms used herein shall be prepared, delivered and used without
regard to the underlying Accounting Change.
[Signatures Follow]
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IN WITNESS WHEREOF, the parties have caused this LOAN PURCHASE AND SALE
AGREEMENT to be executed by their respective duly authorized representatives, as
of the date first above written.
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