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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): June 26, 1998
BLUEGREEN CORPORATION
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(Exact name of registrant as specified in its charter)
MASSACHUSETTS
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(State of incorporation or organization)
0-19292 03-0300793
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(Commission File Number) (I.R.S. Employer
Identification No.)
4960 BLUE LAKE DRIVE, BOCA RATON, FLORIDA 33431
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(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code: (561) 912-8000
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Item 5. OTHER EVENTS.
On June 26, 1998, Bluegreen Corporation (the "Company") sold, or
otherwise absolutely transferred and assigned, approximately $32 million
aggregate principal amount of timeshare loan receivables (the "Receivables") to
Bluegreen Receivables Finance Corporation III, a wholly-owned special purpose
subsidiary of the Company ("BRFC"), and BRFC sold the Receivables to Heller
Financial, Inc. (the "Purchaser"). The sale and transfer by the Company to BRFC
was made pursuant to a Sale and Contribution Agreement dated as of June 26, 1998
(the "BRFC Agreement") and the sale and transfer by BRFC to the Purchaser was
made pursuant to an Asset Purchase Agreement dated as of June 26, 1998 (the
"Purchase Agreement").
A purchase price equal to approximately 96% of the principal balance
of the Receivables sold was paid by the Purchaser at closing in cash. In
addition, BRFC will be entitled to receive a deferred payment after the
Purchaser has received a return equal to the weighted average term treasury rate
plus 1.4% and all servicing, custodial and similar fees and expenses have been
paid and a cash reserve account has been funded. The Receivables were sold
without recourse to the Company or BRFC except for breaches of representations
and warranties made at the time of sale. The Company will act as servicer for
the Receivables and will be paid a fee. As servicer, the Company will be
required to make advances of delinquent payments to the extent it believes such
advances will be recoverable. However, the Receivables are not obligations of
the Company, BRFC or any of their affiliates and none of the Company, BRFC or
any of their affiliates has any obligation to repurchase or replace Receivables
solely due to delinquency.
The terms of the Purchase Agreement and the sale of the Receivables
were determined based on an arm's-length negotiation among the parties. The sale
was part of the Company's ordinary course of business sale or financing of
receivables generated from the sale of land or timeshare intervals. The sale of
the Receivables is the first in an anticipated series of sales under the
Purchase Agreement. Under the Purchase Agreement, BRFC will be entitled to sell
up to $100 million aggregate principal amount of timeshare receivables to the
Purchaser. The purchase facility has detailed requirements with respect to the
eligibility of receivables for purchase and a two-year term. The Purchaser's
obligation to purchase under the purchase facility will terminate upon the
occurrence of specified trigger events. The purchase facility includes various
conditions to purchase and other provisions customary for securitizations of
this type.
Copies of the BRFC Agreement and the Purchase Agreement are attached
hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by
reference. The foregoing description of the purchase facility and the sale of
the Receivables is subject to, and qualified in its entirety by, reference to
such Exhibits.
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Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
EXHIBIT DESCRIPTION OF EXHIBIT
99.1 Sale and Contribution Agreement dated as of June 26, 1998 by
and among Bluegreen Corporation, Bluegreen Receivables Finance
Corporation III and BRFC III Deed Corporation.
99.2 Asset Purchase Agreement dated as of June 26, 1998 by and
among Bluegreen Corporation, Bluegreen Receivables Finance
Corporation III, BRFC III Deed Corporation, Heller Financial,
Inc. and U.S. Bank National Association, as cash
administrator, including Definitions Annex.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BLUEGREEN CORPORATION
Date: July 23, 1998 By: /s/ Anthony M. Puleo
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Anthony M. Puleo,
Chief Accounting Officer
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EXHIBIT 99.1
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SALE AND CONTRIBUTION AGREEMENT
Dated as of June 26, 1998
among
BLUEGREEN CORPORATION
as seller
BLUEGREEN RECEIVABLES FINANCE CORPORATION III
as purchaser
and
BRFC III DEED CORPORATION
as agent and custodian of certain deeds for the benefit of
Heller Financial, Inc. or its successors and assigns
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS............................................................................................-4-
SECTION 1.01. GENERAL.................................................................................-4-
SECTION 1.02. OTHER INTERPRETIVE PROVISIONS...........................................................-4-
ARTICLE II
AGREEMENT TO TRANSFER; ASSIGNMENT OF AGREEMENT.........................................................-4-
SECTION 2.01. CLOSING OF PURCHASES....................................................................-4-
SECTION 2.02. ASSIGNMENT OF AGREEMENT.................................................................-5-
SECTION 2.03. CONVEYANCE OF SUBSEQUENT RECEIVABLES....................................................-6-
ARTICLE III
REPRESENTATIONS AND WARRANTIES.........................................................................-7-
ARTICLE IIIA
ORIGINATOR AFFIRMATIVE AND NEGATIVE COVENANTS.........................................................-10-
SECTION 3.01A. RECORDS...............................................................................-10-
SECTION 3.02A. USE OF PURCHASER NAME.................................................................-10-
SECTION 3.03A. OTHER DOCUMENTS.......................................................................-10-
SECTION 3.04A. ORIGINATOR'S DUES REQUIREMENT.........................................................-11-
SECTION 3.05A. CONSOLIDATION AND MERGER..............................................................-11-
SECTION 3.06A. RECEIVABLES...........................................................................-11-
SECTION 3.07A. COMPLIANCE WITH LAWS..................................................................-11-
SECTION 3.08A. YEAR 2000.............................................................................-11-
SECTION 3.09A. AUTHORIZED SIGNATORY..................................................................-12-
SECTION 3.10A. ENVIRONMENTAL COMPLIANCE..............................................................-12-
SECTION 3.11A. SHARE TRANSFER........................................................................-13-
ARTICLE IV
PERFECTION OF TRANSFER AND PROTECTION
OF BACK-UP SECURITY INTERESTS.........................................................................-13-
SECTION 4.01. CUSTODY OF RECEIVABLES.................................................................-13-
SECTION 4.02. FILING.................................................................................-14-
SECTION 4.03. NAME CHANGE OR RELOCATION..............................................................-14-
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<TABLE>
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<S> <C> <C>
SECTION 4.04. CHIEF EXECUTIVE OFFICE.................................................................-14-
SECTION 4.05. COSTS AND EXPENSES.....................................................................-15-
SECTION 4.06. SALE TREATMENT.........................................................................-15-
ARTICLE V
REMEDIES UPON MISREPRESENTATION.......................................................................-15-
SECTION 5.01. REPURCHASES AND SUBSTITUTIONS OF RECEIVABLES FOR BREACH OF
REPRESENTATIONS AND WARRANTIES.........................................................-15-
SECTION 5.02. REASSIGNMENT OF REPURCHASED OR SUBSTITUTED RECEIVABLES.................................-15-
ARTICLE VI
INDEMNITIES...........................................................................................-16-
SECTION 6.01. ORIGINATOR INDEMNIFICATION.............................................................-16-
SECTION 6.02. LIABILITIES TO OBLIGORS................................................................-16-
ARTICLE VII
MISCELLANEOUS.........................................................................................-16-
SECTION 7.01. MERGER OR CONSOLIDATION................................................................-16-
SECTION 7.02. TERMINATION............................................................................-17-
SECTION 7.03. ASSIGNMENT OR DELEGATION BY THE SELLERS................................................-17-
SECTION 7.04. AMENDMENT..............................................................................-17-
SECTION 7.05. NOTICES. .............................................................................-17-
SECTION 7.06. MERGER AND INTEGRATION.................................................................-18-
SECTION 7.07. HEADINGS...............................................................................-18-
SECTION 7.08. GOVERNING LAW..........................................................................-18-
SECTION 7.09. NO BANKRUPTCY PETITION. ...............................................................-19-
SECTION 7.10. OMITTED................................................................................-19-
SECTION 7.11. SEVERABILITY OF PROVISIONS. ...........................................................-19-
SECTION 7.12. NO WAIVER; CUMULATIVE REMEDIES. .......................................................-19-
SECTION 7.13. COUNTERPARTS. .........................................................................-19-
SECTION 7.14. INTENDED CHARACTERIZATION. ............................................................-19-
EXHIBITS
Exhibit A Form of Sale Assignment
Exhibit B Form of Subsequent Purchase Agreement
Exhibit C Form of Allonge
Exhibit D Form of Master Assignment
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SALE AND CONTRIBUTION AGREEMENT
This Sale and Contribution Agreement, dated as of June 26, 1998, is
made by and among Bluegreen Corporation, a Massachusetts corporation, (together
with its permitted successors and assigns, the "ORIGINATOR"), Bluegreen
Receivables Finance Corporation III, a Delaware corporation (together with its
permitted successors and assigns, "FUNDING") and BRFC III Deed Corporation, as
the custodian of certain deeds (together with its permitted successors and
assigns, "DEED CORP").
WHEREAS, in the regular course of its business, the Originator
originates and purchases Receivables;
WHEREAS, Funding has been established as a wholly-owned
bankruptcy-remote subsidiary of the Originator for the purpose of the
Originator's selling and/or contributing to it from time to time in accordance
with the terms of this Agreement Receivables and related Assets owned by the
Originator;
WHEREAS, Deed Corp has been established as a wholly-owned
bankruptcy-remote subsidiary of the Originator for the purpose of holding deeds
relating to Receivables which are in the form of conditional sales contracts the
Receivables of which are sold to Funding and simultaneously therewith sold to
Heller Financial, Inc. (together with its permitted successors and assigns,
"HFI") under the Asset Purchase Agreement (as hereinafter defined), such deeds
to be held by Deed Corp solely as agent of and custodian for the Purchaser (as
hereinafter defined);
WHEREAS, the Originator and Funding wish to set forth the terms and
conditions pursuant to which Funding will acquire such Receivables (including
Subsequent Receivables) and related Assets (such Receivables, including
Subsequent Receivables, together with such related Assets as more fully
described herein, being the "RECEIVABLES AND RELATED ASSETS" (as hereinafter
defined)); and
WHEREAS, Funding intends concurrently with each transfer of Receivables
and related Assets hereunder to sell, transfer and otherwise absolutely convey
all right, title and interest in and to the Receivables and related Assets to
Purchaser pursuant to the Asset Purchase Agreement dated as of June 26, 1998 by
and among Funding, as Seller thereunder, HFI, as Purchaser thereunder (the
"PURCHASER"), the Originator, Bluegreen Corporation, in its separate capacity as
Servicer (the "SERVICER"), Deed Corp, as custodian and agent for HFI under the
Deed Custodian Agreement and the Cash Administrator named therein (as amended,
supplemented or otherwise modified from time to time, the "ASSET PURCHASE
AGREEMENT"), executed concurrently herewith;
WHEREAS, in connection with the execution and delivery of this
Agreement and the Asset Purchase Agreement, the Servicer, the Originator,
Funding, Deed Corp and Purchaser have entered into the Servicing Agreement Re
Asset Purchase Agreement dated June 26, 1998 (as amended, supplemented or
otherwise modified from time to time, the "SERVICING AGREEMENT"); and
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WHEREAS, the Originator, Deed Corp, Funding and HFI wish to set forth
the terms and conditions pursuant to which (i) the Originator will sell,
transfer and otherwise convey all Receivables and related Assets to Funding, and
(ii) the Receivables Files, deeds and other instruments, certificates, books,
records and information of any kind relating to the Receivables and related
Assets referred to in the foregoing clause (i) and from time to time sold and
purchased hereunder and under the Asset Purchase Agreement will be transferred
to the Originator and Deed Corp (as custodian and agent for HFI) under the Deed
Custodian Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the Originator and Funding agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. GENERAL. Unless otherwise defined in this Agreement,
capitalized terms used herein (including in the preamble above) have the
meanings assigned to them in the Definitions Annex to the Asset Purchase
Agreement.
SECTION 1.02. OTHER INTERPRETIVE PROVISIONS. Except to the extent
otherwise specified in the particular term or provision at issue, this Agreement
shall be interpreted and construed in accordance with the Document Conventions.
ARTICLE II
AGREEMENT TO TRANSFER; ASSIGNMENT OF AGREEMENT
SECTION 2.01. CLOSING OF PURCHASES. No later than five (5) Business
Days prior to each Purchase Date (or such shorter period to which Funding shall
agree), the Originator will deliver or cause to be delivered to Funding a notice
specifying all outstanding Eligible Receivables currently owned by the
Originator which the Originator wishes to transfer and assign pursuant to this
Agreement, together with the information described in EXHIBIT B to the Asset
Purchase Agreement with respect thereto through such day. On or prior to the
Purchase Date, Funding will notify the Originator of the Eligible Receivables it
will purchase (the "PURCHASED RECEIVABLES") on such date and the cash purchase
price (the "SALE PRICE") it will pay for such purchase. To the extent that there
is no Sale Price or the cash portion of the Sale Price for the Purchased
Receivables is less than the fair market value thereof, the difference shall be
deemed a capital contribution by the Originator to Funding. The Originator and
Funding shall enter into a certificate of assignment (the "SALE ASSIGNMENT"),
dated as of each Purchase Date, substantially in the form of EXHIBIT A hereto,
identifying all Purchased Receivables being conveyed on such date and the
Originator shall either execute an Allonge (with respect to notes or
instruments) in the form of EXHIBIT C attached hereto or a Master Assignment
(with respect to Receivables which take the form of conditional sales contracts)
in the form of Exhibit D attached hereto. The Sale Price shall be payable by
Funding in
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full by wire transfer on the Purchase Date to an account designated by the
Originator to Funding on or before the Purchase Date.
Concurrent with the payment of the Sale Price, if any, for Purchased
Receivables and execution of the Sale Assignment, the Originator shall have, and
shall be deemed for all purposes to have, sold, transferred, assigned, set over
and otherwise conveyed to Funding, in consideration therefor, all the
Originator's right, title and interest in and to the following (items (i) - (vi)
below, collectively, being referred to as the "RECEIVABLES AND RELATED ASSETS"):
(i) the Purchased Receivables identified by Funding to the
Originator as described above, and all Collections thereon and
monies due or to become due in payment of such Purchased
Receivables after the applicable Cutoff Date;
(ii) the Intervals related to such Purchased Receivables subject to
the Obligors' rights thereunder, including all proceeds from
any sale or other disposition of such Interval;
(iii) the related Receivable Files;
(iv) all payments made or to be made in the future with respect to
such Purchased Receivables or the Obligor thereunder under any
guarantee or similar credit enhancement with respect to such
Purchased Receivables;
(v) all Insurance Proceeds with respect to each such Purchased
Receivable; and
(vi) all income from and proceeds of the foregoing.
The foregoing sale, transfer, assignment, set-over and conveyance does not
constitute and is not intended to result in a creation or an assumption by
Funding (or any assignee thereof) of any obligation of the Originator in
connection with the Receivables and related Assets, or any agreement or
instrument relating thereto, including, without limitation, any obligation to
any Obligor or any other Person, or (i) any taxes, fees, or other charges
imposed by any Governmental Authority and (ii) any insurance premiums which
remain owing with respect to any Receivable at the time such Receivable is sold
hereunder; PROVIDED THAT Funding (or any assignee thereof) shall be required to
deliver (or cause to be delivered) to the applicable Obligor the deed evidencing
such Obligor's Interval upon payment in full of the conditional sales contract,
if applicable.
SECTION 2.02. ASSIGNMENT OF AGREEMENT. Funding has the right to assign
its interest under this Agreement to the Purchaser as may be required to effect
the purposes of the Asset Purchase Agreement, without further notice to, or
consent of, the Originator, and the Purchaser shall succeed to such of the
rights of Funding hereunder as shall be so assigned. The Originator acknowledges
that, pursuant to the Asset Purchase Agreement, Funding will assign all of its
right, title and interest
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in and to the Receivables and related Assets conveyed hereunder, including but
not limited to, its right to exercise the remedies created by Section 5.01
hereof for breaches of representations and warranties of the Originator
contained in Article III hereof, to the Purchaser as well as any other covenants
or representations or warranties made by the Originator hereunder. The
Originator agrees that, upon such assignment to the Purchaser, such remedies,
covenants and representations will run to and be for the benefit of the
Purchaser and its assignees and the Purchaser or such assignee may enforce the
same directly without joinder of Funding.
SECTION 2.03. CONVEYANCE OF SUBSEQUENT RECEIVABLES. Subject to the
satisfaction of the conditions set forth in Section 2.11 of the Asset Purchase
Agreement, the Originator may at its option (but shall not be obligated to)
sell, transfer, assign, set over and otherwise convey to Funding (by delivery of
an executed Subsequent Purchase Agreement substantially in the form attached as
EXHIBIT B hereto), without recourse other than as expressly provided in the
Transaction Documents (and in consideration of Funding's concurrent transfer of
property, by exchange of one or more related Receivables released by the
Purchaser to Funding on the Subsequent Transfer Date, in the case of a
Subsequent Receivable which is a Substitute Receivable) all the right, title and
interest of the Originator in and to the following (the property in clauses (i)
- - (vi) below, collectively upon such transfer, becoming part of the "RECEIVABLES
AND RELATED ASSETS"):
(i) the Subsequent Receivables identified in the related Addition
Notice, and all Collections thereon and monies due or to
become due in payment of such Subsequent Receivables after the
applicable Cutoff Date;
(ii) the Intervals related to such Subsequent Receivables,
including all proceeds from any sale or other disposition of
such Interval;
(iii) the related Receivable Files;
(iv) all payments made or to be made in the future with respect to
such Receivables or the Obligor thereunder under any guarantee
or similar credit enhancement with respect to such
Receivables;
(v) all Insurance Proceeds with respect to each such Subsequent
Receivable; and
(vi) all income from and proceeds of the foregoing.
To the extent that the property delivered by Funding to the Originator in
exchange for the Subsequent Receivables and related Receivables and related
Assets being conveyed has a value less than the fair market value of such
Subsequent Receivables and related Receivables and related Assets, the
difference shall be deemed a capital contribution by the Originator to Funding
in respect of such Subsequent Receivables.
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Any such sale, transfer, assignment, set-over and conveyance shall not
constitute and is not intended to result in a creation or an assumption by
Funding (or any assignee thereof) of any obligation of the Originator in
connection with such Receivables and related Assets, or any agreement or
instrument relating thereto, including, without limitation, any obligation to
any Obligor or any other Person, or (i) any taxes, fees, or other charges
imposed by any Governmental Authority and (ii) any insurance premiums which
remain owing with respect to any such Receivable at the time such Receivable is
conveyed hereunder; PROVIDED THAT Funding (or any assignee thereof) shall be
required to deliver (or cause to be delivered) to the applicable Obligor the
deed evidencing such Obligor's Interval upon payment in full of the conditional
sales contract, if applicable.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Pursuant to each Sale Assignment, the Originator will make, and upon
execution of each Subsequent Purchase Agreement will be deemed to remake, the
representations and warranties set forth in Sections 5.1 and 5.2 of the Asset
Purchase Agreement for the benefit of Funding; provided, however, with respect
to the representations and warranties relating to the Receivables, such
representation and warranty shall be made only on their date of purchase
hereunder. Such representations and warranties are incorporated by reference in
this Article III, and Funding may rely thereon as if such representations and
warranties were fully set forth herein. It is understood and agreed that the
representations and warranties incorporated by reference in this Article III
shall survive the conveyance of the Purchased Receivables to Funding and any
conveyance of the Purchased Receivables by Funding to Purchaser and shall
continue so long as any Purchased Receivable shall remain outstanding. The
repurchase (or, in the alternative, substitution) obligation of the Originator
set forth in Section 5.01 below and in Section 6.3 of the Asset Purchase
Agreement constitutes the sole remedy available for a breach of a representation
or warranty of the Originator incorporated by reference through this Article
III. The Originator is not responsible for and shall have no obligation with
respect to the Obligors' payment obligations under the Purchased Receivables,
except with respect to Servicer Advances and obligations hereunder with respect
to breaches of representations and warranties relating to the Receivables;
provided, however, this sentence shall not be construed to limit, in any manner,
any other Originator obligation under the Transaction Documents.
In addition, on the Closing Date, and upon the effectiveness of each
conveyance of Receivables and related Assets hereunder the Originator makes, and
upon each conveyance of Subsequent Receivables under a Subsequent Purchase
Agreement the Originator will be deemed to remake, the following representations
and warranties:
(a) ORGANIZATION AND GOOD STANDING. The Originator is a corporation
duly organized and validly existing in good standing under the laws of
the State of Massachusetts, and has full corporate power, authority and
legal right to own its properties and conduct its business as such
properties are presently owned and such
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business is presently conducted, and to execute, deliver and perform
its obligations under this Agreement and each other Transaction
Document to which it is a party.
(b) DUE QUALIFICATION. The Originator is duly qualified to do business
and is in good standing as a foreign corporation (or is exempt from
such requirements), and has obtained or will obtain all necessary
licenses and approvals, in each jurisdiction in which failure to so
qualify or to obtain such licenses and approvals would have a material
adverse effect on its ability to perform its obligations hereunder.
(c) DUE AUTHORIZATION. The execution and delivery of this Agreement and
each other Transaction Document to which it is a party, and the
consummation of the transactions provided for herein and therein, have
been duly authorized by the Originator by all necessary corporate
action on the part of the Originator.
(d) NO CONFLICT. The execution and delivery of this Agreement and each
other Transaction Document to which it is a party, the performance of
the transactions contemplated hereby and thereby and the fulfillment of
the terms hereof and thereof will not conflict with, result in any
breach of any of the material terms and provisions of, or constitute
(with or without notice or lapse of time or both) a material default
under, any material indenture, contract, agreement, mortgage, deed of
trust, or other instrument to which the Originator is a party (or by
which it or any of its property is bound).
(e) NO VIOLATION. The execution and delivery by the Originator of this
Agreement and each other Transaction Document to which it is a party,
the performance of the transactions contemplated hereby and thereby and
the fulfillment of the terms hereof and thereof (including, without
limitation, the sale of Receivables and related Assets by the
Originator in accordance with the provisions of this Agreement) will
not conflict with or violate, in any material respect, any Requirements
of Law applicable to the Originator.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending
or, to the best knowledge of the Originator, threatened against the
Originator, before any court, regulatory body, administrative agency,
or other tribunal or governmental instrumentality (i) asserting the
invalidity of this Agreement or any other Transaction Document, (ii)
seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or any other Transaction Document or
(iii) seeking any determination or ruling that could reasonably be
expected to be adversely determined, and if adversely determined, would
materially and adversely affect the performance by the Originator of
its obligations under this Agreement or any other Transaction Document.
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(g) ALL CONSENTS REQUIRED. All approvals, authorizations, consents,
orders or other actions of any Person or of any Governmental Authority
required in connection with the Originator's execution and delivery of
this Agreement and the other Transaction Documents to which it is a
party, the performance of the transactions contemplated hereby and
thereby, and the fulfillment of the terms hereof and thereof, have been
obtained.
(h) BULK SALES. The execution, delivery and performance of this
Agreement do not require compliance with any "bulk sales" law by the
Originator.
(i) SOLVENCY. After giving effect to the transactions under this
Agreement, the Originator will be Solvent.
(j) SELECTION PROCEDURES. No selection procedures believed by the
Originator to be materially adverse to the interests of Funding or the
Purchaser were utilized by the Originator in selecting the Receivables
constituting part of the Receivables and related Assets being sold
hereunder.
(k) TAXES. The Originator has filed or caused to be filed all tax
returns which, to its knowledge, are required to be filed and has paid
all taxes shown to be due and payable on such returns or on any
assessments made against it or any of its or its subsidiaries property
and all other taxes, fees or other charges imposed on it or any of its
property by any Governmental Authority (other than any amount of tax
due the validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in
accordance with generally accepted accounting principles have been
provided on the books of the Originator); no tax lien has been filed
and, to the Originator's knowledge, no claim is being asserted, with
respect to any such tax, fee or other charge.
(l) AGREEMENTS ENFORCEABLE. This Agreement and the other Transaction
Documents to which the Originator is a party constitute the legal,
valid and binding obligation of the Originator enforceable against the
Originator in accordance with their respective terms, except as such
enforceability may be limited by (i) applicable Insolvency Laws and
(ii) general principles of equity (whether considered as a suit at law
or in equity).
(m) EXCHANGE ACT COMPLIANCE. No proceeds of any conveyance hereunder
will be used by the Originator to acquire any security in any
transaction which is subject to Section 13 or 14 of the Securities
Exchange Act of 1934, as amended.
(n) TITLE; PRIOR LIENS WITH RESPECT TO THE RESORTS AND ADDITIONAL
RESORTS. Originator and its Subsidiaries have good and marketable title
to the Resorts or Additional Resorts (excluding sold Intervals and any
equitable rights of Obligors
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under applicable state law to the Units under any conditional land
sales contracts which are the subject of any Receivables and related
Assets).
(o) ACCESS. The Resorts and Additional Resorts relating to the
Receivables and related Assets, have direct access to a publicly
dedicated road over a recorded easement and all roadways, if any,
inside the Resorts and Additional Resorts are or will be common areas
under the declaration after the first purchase of Receivables
originated at such Resort or Additional Resort.
(p) UTILITIES. Electric, gas, sewer, water facilities and other
necessary utilities are lawfully available in sufficient capacity to
service the Units relating to the Intervals in the Resorts and
Additional Resorts relating to the Receivables and any easements
necessary to the furnishing of such utility service have been obtained
and duly recorded.
(q) AMENITIES. All amenities described in the sales prospectus and the
"PUBLIC REPORTS" for the Resorts and Additional Resorts relating to the
Receivables are completed, or will be completed, in the time periods
described in the "PUBLIC REPORTS", or a bond insuring their completion
has been posted. Each Obligor has or will have in the time period
described in the Public Reports access to and the use of all of the
amenities and public utilities of the Resorts and the Additional
Resorts relating to the Receivables as and to the extent provided in
the Declaration and the "PUBLIC REPORTS".
ARTICLE IIIA
ORIGINATOR AFFIRMATIVE AND NEGATIVE COVENANTS
SECTION 3.01A. RECORDS. Originator shall keep adequate records and
books of account reflecting all financial transactions of Originator and (to the
extent available to the Originator) the Time Share Associations, including sales
of Intervals, in which complete entries will be made in accordance with GAAP.
SECTION 3.02A. USE OF PURCHASER NAME. Originator will not, and will not
permit any Affiliate to, without the prior written consent of Purchaser, use the
name of Purchaser or the name of any affiliates of Purchaser in connection with
any of their respective businesses or activities, except in connection with
internal business matters, administration of the Purchase Agreement and as
required in dealings with governmental agencies including any reports required
to be filed with the Securities and Exchange Commission.
SECTION 3.03A. OTHER DOCUMENTS. To the extent not maintained by the
Custodian or Servicer, Originator will maintain accurate and complete files
relating to the Receivables and the related Assets to the satisfaction of
Funding and Purchaser, and such files (to the extent not
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computerized) will contain copies of each Originator Receivable and the related
Assets together with the purchase agreements, truth-in-lending statements, all
relevant credit memoranda and all collection information and correspondence
relating to such Receivables.
SECTION 3.04A. ORIGINATOR'S DUES REQUIREMENT. The Originator shall be
obligated to pay the Time Share Association dues relating to Intervals which are
owned by the Originator or one of its Affiliates and do not relate to
Receivables and for as long as the Originator or one of its Subsidiaries
controls the Resorts or Additional Resorts, shall provide such monies as are
necessary to maintain services for a Resort or an Additional Resort which is
equal to or greater than one hundred percent (100%) of such Resorts or
Additional Resorts total operating expenses, taxes, utilities and associated
reserve fund requirements.
SECTION 3.05A. CONSOLIDATION AND MERGER. The Originator will not
consolidate with or merge into any other Person or permit any other Person to
consolidate with or merge into it or convey all or substantially all of its
assets to any Person, unless (i) either the Originator shall be the continuing
corporation or the successor corporation or the person which acquires by sale or
conveyance substantially all the assets of the Originator shall be a corporation
organized under the laws of the United States of America or any State thereof
and shall expressly assume the due and punctual performance and observance of
all of the covenants and conditions of this Agreement to be performed or
observed by the Originator , by an amendment hereto in form satisfactory to the
Purchaser, and (ii) the Originator or such successor corporation, as the case
may be, shall not, immediately after such merger or consolidation, or such sale
or conveyance, be in breach in the performance of any such covenant or
condition.
SECTION 3.06A. RECEIVABLES. The Originator shall not take any action
(nor permit or consent to the taking of any action) which might reasonably be
anticipated to impair the value of the Receivables or related Assets or any of
the rights of Purchaser in the Receivables or related Assets; provided, however,
nothing contained in this Section 3.06A shall be construed as requiring the
Originator to guarantee or otherwise become liable for the payment of the
Obligors' payments under the Receivables.
SECTION 3.07A. COMPLIANCE WITH LAWS. Originator , and each of the Units
in which Intervals are being sold, shall comply with, conform to and obey each
and every judgment, law, statute, rule and governmental regulation applicable to
it and each indenture, order, instrument, agreement or document to which it is a
party or by which it is bound except where the failure to comply would not have
a material adverse effect on the Receivables.
SECTION 3.08A. YEAR 2000. Originator has made an assessment of the
microchip and computer-based systems and the software used in its businesses and
based upon such assessment believes that it will be "YEAR 2000 COMPLIANT" by
January 1, 2000. For purposes of this Section 3.08A, "YEAR 2000 COMPLIANT" means
that all software, embedded microchips and other processing capabilities
utilized by, and material to the business operations or financial condition of,
the Originator are able to interpret, store, transmit, receive and manipulate
data on and involving all
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calendar dates correctly and without causing any abnormal ending scenarios in
relation to dates in and after the year 2000. From time to time, at the request
of the Purchaser, Originator shall provide to Purchaser such updated information
as is requested regarding the status of its effort to become Year 2000
Compliant.
SECTION 3.09A. AUTHORIZED SIGNATORY. Any person signing an Advance
Request on behalf of Originator, as provided in Schedule 3.24A hereof shall have
the requisite power and authority to sign the same on behalf of such Originator.
SECTION 3.10A. ENVIRONMENTAL COMPLIANCE.
(a) The operations of Originator comply in all material respects
with all applicable Environmental Laws.
(b) There are no claims, investigations, litigation,
administrative proceedings, whether pending or, to
Originator's best knowledge, threatened, or judgments or
orders, relating to any Hazardous Materials or alleging the
violation of any Environmental Laws (collectively
"ENVIRONMENTAL MATTERS") relating in any way to any operations
of Originator on any real property leased or owned by
Originator or to the operations of Originator the result of
which, if adversely determined, would have a Material Adverse
Effect.
(c) To Originators' knowledge, no Hazardous Materials are
presently stored or otherwise located on, in or under any real
property leased, owned or operated by Originator except in
material compliance with all applicable Environmental Laws,
and, no part of any real property leased, owned or operated by
Originator or to Originators' best knowledge, adjacent
parcels, including the groundwater located thereon, is
presently contaminated by any such Hazardous Material.
(d) Originator has not filed any notice under any international,
federal, state, regional, provincial or local law indicating
past or present treatment, storage or disposal of a Hazardous
Material or reporting a spill or release of a Hazardous
Material into the environment the result of which, if
adversely determined, would have a material adverse effect.
(e) Originator does not have any known material liability,
contingent or otherwise, in connection with any release of any
Hazardous Material into the environment.
(f) Originator hereby indemnifies Funding and agrees to hold
Funding harmless from and against any and all losses,
liabilities, damages, injuries, costs, expenses and claims of
any and every kind whatsoever (including, without
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limitation, court costs and reasonable attorneys' fees and
legal expenses) which at any time or from time to time may be
paid, incurred or suffered by, or asserted against, Funding
arising directly or indirectly from the violation by the
Originator of any Environmental Law with respect to any Resort
or Additional Resort; or with respect to, or as a direct or
indirect result of the presence on or under, or the escape,
seepage, leakage, spillage, discharge, emission or release
from, properties utilized, owned or operated by Originator in
the conduct of its business into or upon any land, the
atmosphere, or any watercourse, body of water or wetland, of
any Hazardous Material (including, without limitation, any
losses, liabilities, damages, injuries, costs, expenses or
claims asserted or arising under the Environmental Laws);
PROVIDED that to the extent that Originator is strictly liable
under any Environmental Laws, the Originator's obligations to
indemnify Funding hereunder shall likewise be without regard
to fault on the part of Originator and with respect to the
violation of law which results in liability to Originator;
PROVIDED, FURTHER, that this Section 3.10A shall not apply
with respect to any liability, release, violation or other
matter that arises solely from Originator's gross negligence
or wilful misconduct after Originator loses possession of any
property due to foreclosure or other exercises of remedies by
Funding. To the extent that the undertaking to indemnify, pay
and hold harmless set forth in this Section 3.10A may be
unenforceable because it is violative of any law or public
policy, Originator shall contribute the maximum portion that
it is permitted to pay and satisfy under applicable law to the
payment and satisfaction of all indemnifications set forth in
this Section 3.10A.
SECTION 3.11A. SHARE TRANSFER. Funding shall not transfer any shares of
capital stock of Deed Corp.
ARTICLE IV
PERFECTION OF TRANSFER AND PROTECTION
OF BACK-UP SECURITY INTERESTS
SECTION 4.01. CUSTODY OF RECEIVABLES. Subject to the terms and
conditions of this Section 4.01, and except as provided in the Custodial
Agreement (i) the contents of each Receivable File shall be held in the custody
of the Originator in its capacity as Servicer under the Servicing Agreement for
the benefit of the owner thereof and (ii) each deed relating to any Interval
subject to a contract for deed included in the Receivables and related Assets
shall be transferred to Deed Corp, in its capacity as Deed Custodian. The
Originator agrees to cooperate with the Servicer in its efforts to comply with
its respective obligations under the Asset Purchase Agreement and the Servicing
Agreement in respect of the Receivables and related Assets, and acknowledges and
consents to the transactions contemplated therein.
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SECTION 4.02. FILING. (a) On or as soon as practicable following each
Purchase Date, the Originator shall cause the UCC financing statement(s)
referred to in Section 5.1(x) of the Asset Purchase Agreement to be filed and
from time to time the Originator shall take and cause to be taken such actions
and execute such documents as are necessary or desirable or as Funding or HFI
may reasonably request to perfect and protect Purchaser's ownership interest in
the Receivables and related Assets against all other persons, including, without
limitation, the filing of financing statements, amendments thereto and
continuation statements, the execution of transfer instruments and the making of
notations on or taking possession of all records or documents of title.
(b) On or as soon as practicable following each Purchase Date, the
Originator will deliver an assignment of the Deed in recordable form, endorse
and transfer to Deed Corp, as custodian and agent for HFI, all deeds, as well as
transfer to the Custodian the Receivables File relating to the Purchased
Receivables or Subsequent Receivables (as the case may be) transferred on such
Purchase Date. Pursuant to the Servicing Agreement, Servicer will record all
deeds included within the Receivables and related Assets in the appropriate
records depository in the jurisdictions in which the real property conveyed by
such deeds are located. Each deed so recorded shall state that it has been
transferred and conveyed to Deed Corp of the Obligor on the Purchased Receivable
relating to such deed and the Purchaser of the related Receivable and shall
further state that Deed Corp shall hold such deed solely as agent and custodian
for the Purchaser.
SECTION 4.03. NAME CHANGE OR RELOCATION. (a) During the term of this
Agreement, the Originator agrees not to change its name, identity or structure
or relocate its chief executive office, or relocate or establish a new location
where Receivable Files are maintained, without first giving at least 30 days'
prior written notice to Funding and HFI.
(b) If any change in the Originator's name, identity or structure or
other action would make any financing or continuation statement or notice of
ownership interest or lien filed under this Agreement seriously misleading
within the meaning of applicable provisions of the UCC or any title statute, the
Originator, no later than five days after the effective date of such change,
shall file such amendments as may be required to preserve and protect the
Purchaser's interests in the Receivables and related Assets and proceeds
thereof. In addition, the Originator agrees not to change its principal place of
business or its chief executive office (within the meaning of Article 9 of the
UCC) from the location specified in Section 12.2 of the Asset Purchase
Agreement, or relocate or establish a location where it maintains Receivable
Files which is other than in one of the UCC Filing Locations, unless it has
first taken such action as is advisable or necessary to preserve and protect
Funding's and HFI's interest in the Receivables and related Assets. Promptly
after taking any of the foregoing actions, the Originator shall deliver to
Funding and HFI an Opinion of Counsel stating that, in the opinion of such
counsel, all financing statements or amendments necessary to preserve and
protect the interests of HFI in the Receivables and related Assets have been
filed, and reciting the details of such filing.
SECTION 4.04. CHIEF EXECUTIVE OFFICE. During the term of this
Agreement, and subject to the other terms and provisions herein relating to
changes in location, the Originator will maintain its
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chief executive office in one of the States of the United States, except
Louisiana, Tennessee, Colorado, Kansas, New Mexico, Oklahoma, Utah or Wyoming.
SECTION 4.05. COSTS AND EXPENSES. The Originator agrees to pay all
reasonable costs and disbursements in connection with the perfection and the
maintenance of perfection, as against all third parties, of Funding's and the
Purchaser's right, title and interest in and to the Receivables and related
Assets (including, without limitation, the interest in the Interval related
thereto).
SECTION 4.06. SALE TREATMENT. The Originator and Funding each shall
treat the transfer of Receivables and related Assets made hereunder for
financial accounting purposes as a sale and purchase on all of its relevant
books, records, financial statements and other applicable documents.
ARTICLE V
REMEDIES UPON MISREPRESENTATION
SECTION 5.01. REPURCHASES AND SUBSTITUTIONS OF RECEIVABLES FOR BREACH
OF REPRESENTATIONS AND WARRANTIES. The Originator hereby agrees, for the benefit
of Funding and its assignees including the Purchaser, that it shall repurchase
an Ineligible Receivable and any Receivable with respect to which there has been
a breach of a representation or warranty under Article III of this Agreement
(together with all related Receivables and related Assets), at a repurchase
price equal to the Transfer Deposit Amount, not later than the next
Determination Date which is at most thirty (30) days after the earlier of (i)
the date the Originator becomes aware of, or (ii) receives written notice from
the Purchaser, the Servicer or Funding of, the related breach or inaccuracy of
representation. Originator's obligation hereunder shall relate solely to a
breach or inaccurate representation which materially adversely affects a
Receivable or with respect to Receivables for which the breach of a
representation or warranty in the aggregate materially adversely affects the
Purchaser. If the Originator is able to effect a substitution for any such
Ineligible Receivable in compliance with Section 2.03, the Originator may, in
lieu of repurchasing such Receivable, effect a substitution for such affected
Receivable with a Substitute Receivable not later than the date a repurchase of
such Ineligible Receivable would be required hereunder; provided further, in the
event the Originator can cure, and in fact cures, the condition which created
the "Ineligible Receivable" in the above described 30 day period the Originator
shall not be obligated to substitute or repurchase such Receivable.
SECTION 5.02. REASSIGNMENT OF REPURCHASED OR SUBSTITUTED RECEIVABLES.
Upon receipt by the Cash Administrator for deposit in the Collection Account of
the repurchase price as described in Section 5.01 (or upon the Subsequent
Transfer Date related to a Substitute Receivable described in Section 5.01),
Funding shall assign to the Originator all of Funding's right, title and
interest in the repurchased or Replaced Receivable and related Assets, in each
case received by release from the Purchaser in accordance with Section 6.2 of
the Asset Purchase Agreement, without recourse, representation or warranty.
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ARTICLE VI
INDEMNITIES
SECTION 6.01. ORIGINATOR INDEMNIFICATION. The Originator will defend
and indemnify Funding and its assignees (including the Purchaser) (any of which,
an "INDEMNIFIED PARTY") against any and all costs, expenses, losses, damages,
claims and liabilities, joint or several, including reasonable fees and expenses
of counsel and expenses of litigation (collectively, "COSTS") arising out of or
resulting from any acts, omissions or alleged acts or omissions of the
Originator arising out of or relating to this Agreement or any other Transaction
Document which are in violation or contravention of the terms of this Agreement
or any other Transaction Document or the use, ownership or operation of any
Interval by the Originator or the Servicer or any Affiliate of either or any
representation or warranty or covenant made by the Originator in this Agreement
being untrue or incorrect (subject to the third sentence of the preamble to
Article III of this Agreement above); PROVIDED, HOWEVER, that the Originator
shall not be required to so indemnify any such Indemnified Party for such Costs
to the extent that such Cost shall be due to or arise from the willful
misfeasance, bad faith or gross negligence of such Indemnified Party, or the
failure of such Indemnified Party to comply with any express undertaking,
agreement or covenant made by such Indemnified Party in a Transaction Document
to which it is a party; PROVIDED FURTHER that nothing contained in this Section
6.01 shall be construed to obligate the Originator to indemnify an Indemnified
Party with respect to losses, claims, damages and liabilities incurred solely as
a result of the payment performance of the Receivables and the related Assets.
Notwithstanding any other provision of this Agreement, the obligations of the
Originator under this Section 6.01 shall not terminate upon a Service Transfer
pursuant to Section 3.3 of the Servicing Agreement and shall survive any
termination of that agreement, the Asset Purchase Agreement or this Agreement.
SECTION 6.02. LIABILITIES TO OBLIGORS. No obligation or liability to
any Obligor under any of the Receivables is intended to be assumed by Funding or
the Purchaser under or as a result of this Agreement and the transactions
contemplated hereby except the obligation to deliver the deed upon payment in
full.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. MERGER OR CONSOLIDATION. (a) Except as otherwise provided
in this Section 7.01, the Originator will keep in full force and effect its
existence, rights and franchises as a Massachusetts corporation, and the
Originator will obtain and preserve its qualification to do business as a
foreign corporation in each jurisdiction in which such qualification is or shall
be necessary to protect the validity and enforceability of this Agreement and of
any of the Receivables and to perform its duties under this Agreement.
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(b) Any person into which the Originator may be merged or consolidated,
or any corporation resulting from such merger or consolidation to which the
Originator is a party, or any person succeeding to the business of the
Originator, shall be the successor to the Originator hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
SECTION 7.02. TERMINATION. This Agreement shall terminate (after
distribution of all amounts distributable pursuant to Section 2.7 of the Asset
Purchase Agreement) on the Payment Date on which the Aggregate Unpaids have been
reduced to zero; PROVIDED, that the Originator's indemnities by the Originator
shall survive termination.
SECTION 7.03. ASSIGNMENT OR DELEGATION BY THE SELLERS. Except as
specifically authorized hereunder, the Originator may not convey and assign or
delegate any of its rights or obligations hereunder absent the prior written
consent of Funding and the Purchaser, and any attempt to do so without such
consent shall be void.
SECTION 7.04. AMENDMENT. This Agreement may not be amended without the
prior written consent of the Purchaser. Any such amendment shall be in writing
and executed by the parties hereto (including in counterparts). Upon the
execution of any amendment in compliance with this Section 7.04, this Agreement
shall be modified in accordance therewith, and such amendment shall form a part
of this Agreement for all purposes.
SECTION 7.05. NOTICES. All notices, demands, certificates, requests and
communications hereunder ("NOTICES") shall be in writing and shall be effective
(a) upon receipt when sent through the U.S. mails, registered or certified mail,
return receipt requested, postage prepaid, with such receipt to be effective the
date of delivery indicated on the return receipt, or (b) one Business Day after
delivery to an overnight courier, or (c) on the date personally delivered to an
Authorized Officer of the party to which sent, or (d) on the date transmitted by
legible telefax transmission with a confirmation of receipt, in all cases
addressed to the recipient as follows:
If to the Originator/Servicer: Bluegreen Corporation
4960 Blue Lake Drive
Boca Raton, Florida 33431
Attn: Patrick E. Rondeau, Esq.
Telephone No.: (561) 912-8005
Telecopy: (561) 912-8100
If to Funding: Bluegreen Receivables Finance
Corporation III
4960 Blue Lake Drive
Boca Raton, Florida 33431
Attn: Patrick E. Rondeau, Esq.
Telephone No.: (561) 912-8005
Telecopy: (561) 912-8100
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If to Deed Corp: Bluegreen Corporation
4960 Blue Lake Drive
Boca Raton, Florida 33431
Attn: Patrick E. Rondeau, Esq.
Telephone No.: (561) 912-8005
Telecopy: (561) 912-8100
If to Purchaser: Heller Financial, Inc.
28th Floor - Heller Sales Finance
500 W. Monroe Street
Chicago, Illinois 60661
Attn: Portfolio Manager, Vacation
Ownership
Facsimile: (312) 441-7924
with a copy to: Heller Financial, Inc.
28th Floor - Heller Sales Finance
500 W. Monroe Street
Chicago, Illinois 60661
Attn: Group General Counsel -
Vacation Ownership
Facsimile: (312) 441-7872
If to the Cash Administrator: U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Sheryl Christopherson
Fax No.: (612) 244-1797
Tel. No.: (612) 244-0739
Each party hereto may, by notice given in accordance herewith to each of the
other parties hereto, designate any further or different address to which
subsequent notices shall be sent.
SECTION 7.06. MERGER AND INTEGRATION. Except as specifically stated
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived, or supplemented except as provided herein.
SECTION 7.07. HEADINGS. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 7.08. GOVERNING LAW. This Agreement shall be governed by, and
construed and enforced in accordance with, the internal laws of the State of
Illinois.
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SECTION 7.09. NO BANKRUPTCY PETITION. The Originator covenants and
agrees that, prior to the date that is one year and one day after the payment in
full of all Aggregate Unpaids, it will not institute against Funding, or join
any other Person in instituting against Funding, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings or other similar proceedings
under the laws of the United States or any state of the United States, or take
any action in contemplation or furtherance of any of the foregoing. This Section
7.09 will survive the termination of this Agreement.
SECTION 7.10. OMITTED.
SECTION 7.11. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreement, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
SECTION 7.12. NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise
and no delay in exercising, on the part of Funding (or any assignee thereof) or
the Originator, any right, remedy, power or privilege hereunder, shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
remedy, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The
rights, remedies, powers and privileges herein provided are cumulative and not
exhaustive (except to the extent specifically provided herein) of any other
rights, remedies, powers or privileges provided by law.
SECTION 7.13. COUNTERPARTS. This Agreement may be executed in two or
more counterparts including by telefax transmission thereof (and by different
parties on separate counterparts), each of which shall be an original, but all
of which together shall constitute one and the same instrument.
SECTION 7.14. INTENDED CHARACTERIZATION. The Originator, Funding and
the Purchaser agree that any conveyance hereunder or under the Asset Purchase
Agreement is intended to be a sale and conveyance of ownership of the
Receivables and related Assets, rather than the mere granting of a security
interest to secure a borrowing. If, notwithstanding such expressed interest, any
such transfer is deemed to be of a mere security interest to secure
indebtedness, the Originator shall be deemed to have granted (and hereby grants
to) each of Funding and the Custodian, as agent for Funding, a perfected first
priority security interest in such Receivables and related Assets and this
Agreement shall constitute a security agreement under applicable law, securing
the repayment of the purchase price paid hereunder and the obligations and/or
interests provided for in this Agreement and in the order and priorities, and
subject to the other terms and conditions of, the Asset Purchase Agreement,
together with such other obligations or interests as may arise hereunder and
thereunder in favor of the parties hereto and thereto. If such transfer is
deemed to be the mere granting of a security interest to secure a borrowing,
Funding may, to secure Funding's own obtainment of funds under the Asset
Purchase Agreement (to the extent that the conveyance of the Receivables and
related Assets thereunder is deemed to be a mere granting of a security interest
to secure a borrowing) repledge and
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reassign (i) all or a portion of the Receivables and related Assets pledged to
Funding and not released from the security interest of this Agreement at the
time of such pledge and assignment, and (ii) all proceeds thereof. Such repledge
and reassignment may be made by Funding with or without a repledge and
reassignment by Funding of its rights under this Agreement, and without further
notice to or acknowledgment from the Originator. The Originator waives, to the
extent permitted by applicable law, all claims, causes of action and remedies,
whether legal or equitable (including any right of setoff), against Funding or
any assignee of Funding relating to such action by Funding in connection with
the transactions contemplated by the Asset Purchase Agreement.
[remainder of page intentionally blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first written above.
BLUEGREEN RECEIVABLES FINANCE
CORPORATION III
By: __________________________________
Printed Name:______________________
Title: _____________________________
BLUEGREEN CORPORATION
By: __________________________________
Printed Name:______________________
Title: _____________________________
BRFC III DEED CORPORATION
By: __________________________________
Printed Name:______________________
Title: _____________________________
Acknowledged and Agreed to:
HELLER FINANCIAL, INC.
By: ____________________________
Printed Name: ________________
Title: _______________________
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Exhibit A
Sale and Contribution Agreement
FORM OF SALE ASSIGNMENT
In accordance with the Sale and Contribution Agreement (the
"AGREEMENT") dated as of [_____], 1998 made by and between the undersigned, as
Originator thereunder ("ORIGINATOR"), and Bluegreen Receivables Finance
Corporation III, a Delaware corporation and wholly-owned subsidiary of
Originator ("FUNDING"), the undersigned does hereby sell, transfer, assign, set
over and otherwise absolutely convey to Funding all its right, title and
interest in and to:
(i) the Receivables described on the List of Receivables attached
hereto, and all Collections thereon and monies due or to
become due in payment of such Receivables after the applicable
Cutoff Date, which is [______];
(ii) the Interval related to each such Receivable, including all
proceeds from any sale or other disposition of such Interval;
(iii) the related Receivable Files;
(iv) all payments made or to be made in the future with respect to
such Receivables or the Obligor thereunder under any guarantee
or similar credit enhancement with respect to such
Receivables;
(v) all Insurance Proceeds with respect to each such Receivable;
and
(vi) all income from and proceeds of the foregoing.
This Assignment is made pursuant to and in reliance upon the
representation and warranties on the part of the undersigned specified in
Article III of the Agreement and no others. Capitalized terms used in this
Assignment and not defined shall have the same meanings as such terms would have
if used in the Agreement.
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<PAGE> 24
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed this [__]th day of [______], 1998.
BLUEGREEN CORPORATION
By: __________________________________
Printed Name:______________________
Title: _____________________________
Accepted:
BLUEGREEN RECEIVABLES FINANCE
CORPORATION III
By: __________________________________
Printed Name:______________________
Title: _____________________________
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Exhibit B
Sale and Contribution Agreement
FORM OF SUBSEQUENT PURCHASE AGREEMENT
Subsequent Purchase Agreement (the "AGREEMENT"), dated as of [_____],
[____], by and between Bluegreen Receivables Finance Corporation III, a Delaware
corporation ("FUNDING"), and Bluegreen Corporation, a Massachusetts corporation
("ORIGINATOR"), pursuant to the Sale and Contribution Agreement referred to
below.
WITNESSETH:
WHEREAS, Funding and the Originator are parties to the Sale and
Contribution Agreement, dated as of [______], 1998 (the "AGREEMENT");
WHEREAS, pursuant to the Agreement, the Originator wishes to convey the
Subsequent Receivables to Funding, and Funding wishes to acquire and accept
conveyance of the same, for the consideration set forth in SECTION 3 below; and
WHEREAS, the Originator has timely delivered an Addition Notice related
to such conveyance as required in the Asset Purchase Agreement dated as of
[____], 1998 (the "PURCHASE AGREEMENT").
NOW, THEREFORE, the Originator and Funding hereby agree as follows:
SECTION 1. DEFINED TERMS. Capitalized terms used herein shall have the
meanings ascribed to them in the Definitions Annex to the Purchase Agreement
unless otherwise defined herein.
"SUBSEQUENT CUTOFF DATE" shall mean, with respect to the Subsequent
Receivables transferred hereby, [________].
"SUBSEQUENT RECEIVABLES" shall mean, for purposes of this Agreement,
the Subsequent Receivables listed in the Subsequent List of Receivables attached
hereto as EXHIBIT A.
"SUBSEQUENT TRANSFER DATE" shall mean, with respect to the Subsequent
Receivables conveyed hereby, [________].
SECTION 2. SUBSEQUENT LIST OF RECEIVABLES. The Subsequent List of
Receivables attached hereto as EXHIBIT A is an amendment to the initial List of
Receivables attached as Exhibit [__] to the Purchase Agreement, as contemplated
in the definition of List of Receivables. The Subsequent List of Receivables
separately identifies (by attached schedule, or marking or other effective
identifying
<PAGE> 26
designation) the Subsequent Receivables to be transferred pursuant to this
Agreement on the Subsequent Transfer Date, and also further separately
identifies (by attached schedule, or marking or other effective identifying
designation) the related intended Subsequent Receivable or Receivables with
respect to which an Addition Notice has been delivered and which Receivables are
being deleted from the List of Receivables by virtue of the delivery of the
Subsequent List of Receivables.
SECTION 3. TRANSFER OF SUBSEQUENT RECEIVABLES. Subject to and upon the
terms and conditions set forth in Section 2.03 of the Agreement and this
Agreement, the Originator hereby sells, transfers, assigns, sets over and
otherwise conveys to Funding, in consideration of Funding's payment of
$__________ as the purchase price therefor:
(i) the Subsequent Receivables identified in the related Addition
Notice, and all Collections thereon and monies due or to
become due in payment of such Receivables after the related
Subsequent Cutoff Date;
(ii) the Intervals related to such Receivables, including all
proceeds from any sale or other disposition of such Interval;
(iii) the related Receivable Files;
(iv) all payments made or to be made in the future with respect to
such Receivables or the Obligor thereunder under any guarantee
or similar credit enhancement with respect to such
Receivables;
(v) all Insurance Proceeds with respect to each such Receivable;
and
(vi) all income from and proceeds of the foregoing.
It is the intention of the Originator and Funding that the transfer contemplated
by this Agreement shall constitute a conveyance of ownership of the Subsequent
Receivables and related Assets from the Originator to Funding, transferring good
title thereto free and clear of any Liens, and that the Subsequent Receivables
shall not be part of the Originator's estate in the event of the filing of a
bankruptcy petition by or against Originator under any bankruptcy or similar
law.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE ORIGINATOR. (a) The
Originator hereby represents and warrants to Funding that the representations
and warranties of Originator in Section 3.01 of the Agreement are true and
correct as of the Subsequent Transfer Date.
(b) The Originator hereby repeats and remakes with respect to the
Subsequent Receivables as of the Subsequent Transfer Date, the representations
and warranties set forth in the Agreement and deemed to be made with respect to
such Subsequent Receivables thereunder.
-2-
<PAGE> 27
(c) The Originator hereby represents and warrants that (i) the
Receivable Balance of the Subsequent Receivables listed on the Subsequent List
of Receivables and conveyed to Funding pursuant to this Agreement is $__________
as of the Subsequent Cutoff Date, and (ii) the conditions set forth in Section
2.11[__] of the Purchase Agreement have been satisfied as of the Subsequent
Transfer Date.
SECTION 5. RATIFICATION OF AGREEMENT. As supplemented by this
Agreement, the Agreement is in all respects ratified and confirmed and, as so
supplemented by this Agreement, shall be read, taken and construed as one and
the same instrument.
SECTION 6. COUNTERPARTS. This Agreement may be executed in two or more
counterparts (and by different parties in separate counterparts), each of which
shall be an original but all of which together shall constitute one and the same
instrument.
SECTION 7. GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of Illinois, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
[remainder of page intentionally blank]
-3-
<PAGE> 28
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first written above.
BLUEGREEN RECEIVABLES FINANCE
CORPORATION III
By: __________________________________
Printed Name:______________________
Title: _____________________________
BLUEGREEN CORPORATION
By: __________________________________
Printed Name:______________________
Title: _____________________________
<PAGE> 29
EXHIBIT C
Form of Allonge
ALLONGE
This Allonge is attached to and made a part of the following note or
instrument:
"PAY TO THE ORDER OF BLUEGREEN RECEIVABLES FINANCE CORPORATION III,
WITHOUT RECOURSE, REPRESENTATION OR WARRANTY EXCEPT AS PROVIDED IN THE
SALE AND CONTRIBUTION AGREEMENT."
By:___________________________
Name:_________________________
Its:__________________________
The foregoing endorsement shall have the same effect as though it were
written directly on the note or instrument identified above.
The foregoing note or instrument shall be and is hereby endorsed as
follows with respect to the Purchase Facility:
"PAY TO THE ORDER OF HELLER FINANCIAL, INC., WITHOUT RECOURSE,
REPRESENTATION OR WARRANTY EXCEPT AS PROVIDED IN THE ASSET PURCHASE
AGREEMENT."
By:___________________________
Name:_________________________
Its:__________________________
The foregoing endorsement shall have the same effect as though it were
written directly on the note or instrument identified above.
DOCUMENT NUMBER:
<PAGE> 1
EXHIBIT 99.2
ASSET PURCHASE AGREEMENT
Dated as of June 26, 1998
among
BLUEGREEN RECEIVABLES FINANCE CORPORATION III
as the Seller
BRFC III DEED CORPORATION,
as agent and custodian of certain deeds for the benefit of the Purchaser
HELLER FINANCIAL, INC.
as the Purchaser
BLUEGREEN CORPORATION
as the Originator and the Servicer
and
U.S. BANK NATIONAL ASSOCIATION,
as Cash Administrator
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE I
<S> <C>
DEFINITIONS..............................................................................................2
Section 1.1 CERTAIN DEFINED TERMS..................................................................2
Section 1.2 OTHER INTERPRETIVE PROVISIONS..........................................................2
ARTICLE II
THE PURCHASE FACILITY....................................................................................2
Section 2.1 SALE AND PURCHASE OF ASSETS............................................................2
Section 2.2 PROCEDURES FOR PURCHASES...............................................................4
Section 2.3 ESTABLISHMENT OF ACCOUNTS; RESERVE ACCOUNT.............................................4
Section 2.4 [OMITTED]..............................................................................5
Section 2.5 DEPOSITS TO ACCOUNTS...................................................................5
Section 2.6 NON-LIQUIDATION SETTLEMENT PROCEDURES..................................................6
Section 2.7 LIQUIDATION SETTLEMENT PROCEDURES......................................................7
Section 2.8 INVESTMENT OF ACCOUNTS.................................................................8
Section 2.9 PAYMENTS AND COMPUTATIONS; FUNDING INDEMNITY FOR FAILED PURCHASE.......................8
Section 2.10 [OMITTED]..............................................................................9
Section 2.11 ADDITION/SUBSTITUTION OF RECEIVABLES...................................................9
Section 2.12 EXTENSION OF PROGRAM TERMINATION DATE; INCREASE IN COMMITMENT.........................11
ARTICLE III
[RESERVED]..............................................................................................11
ARTICLE IV
CONDITIONS OF PURCHASES.................................................................................11
Section 4.1 CONDITIONS PRECEDENT TO INITIAL PURCHASE..............................................11
Section 4.2 CONDITIONS PRECEDENT TO ALL PURCHASES.................................................11
ARTICLE V
REPRESENTATIONS AND WARRANTIES..........................................................................13
Section 5.1 REPRESENTATIONS AND WARRANTIES OF THE SELLER..........................................13
Section 5.2 REPRESENTATIONS AND WARRANTIES OF SELLER RELATING TO THE AGREEMENT AND
THE RECEIVABLES.......................................................................17
</TABLE>
i
<PAGE> 3
<TABLE>
<CAPTION>
<S> <C>
ARTICLE VI
GENERAL COVENANTS OF THE SELLER.........................................................................20
Section 6.1 GENERAL COVENANTS.....................................................................20
Section 6.2 RELEASE OF INTEREST IN INTERVAL.......................................................23
Section 6.3 RETRANSFER OF INELIGIBLE RECEIVABLES..................................................24
ARTICLE VII
[RESERVED]..............................................................................................25
ARTICLE VIII
EVENTS OF TERMINATION...................................................................................25
Section 8.1 EVENTS OF TERMINATION.................................................................25
ARTICLE IX.......................................................................................................27
Section 9.1 FURTHER ASSURANCES....................................................................27
ARTICLE X
[RESERVED]..............................................................................................28
ARTICLE XI
ASSIGNMENTS; PARTICIPATIONS; RELEASE OF ASSETS..........................................................28
Section 11.1 ASSIGNMENTS...........................................................................28
Section 11.2 PARTICIPATIONS........................................................................28
Section 11.3 INFORMATION TO ASSIGNEES/PARTICIPANTS; CONFIDENTIALITY................................29
Section 11.4 SELLER'S REPURCHASE OPTION............................................................29
ARTICLE XII
MISCELLANEOUS...........................................................................................30
Section 12.1 AMENDMENTS AND WAIVERS................................................................30
Section 12.2 NOTICES, ETC..........................................................................30
Section 12.3 [RESERVED]............................................................................31
Section 12.4 NO WAIVER; REMEDIES...................................................................31
Section 12.5 BINDING EFFECT........................................................................31
Section 12.6 TERM OF THIS AGREEMENT................................................................31
Section 12.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF
OBJECTION TO VENUE....................................................................32
Section 12.8 WAIVER OF JURY TRIAL..................................................................32
</TABLE>
ii
<PAGE> 4
<TABLE>
<CAPTION>
<S> <C> <C>
Section 12.9 COSTS, EXPENSES AND TAXES.............................................................32
Section 12.10 NO BANKRUPTCY COVENANT................................................................33
Section 12.11 PROTECTION OF OWNERSHIP INTERESTS OF THE PURCHASER; INTENT OF PARTIES;
BACK-UP SECURITY INTEREST.............................................................33
Section 12.12 EXECUTION IN COUNTERPARTS; SEVERABILITY; INTEGRATION..................................34
Section 12.13 PURCHASER RIGHT OF FIRST REFUSAL......................................................34
Section 12.14 PURCHASE CESSATION EVENTS.............................................................35
Section 12.15 COOPERATION OF PARTIES TO CLUB CONVERSION.............................................35
SCHEDULE I
CONDITION PRECEDENT DOCUMENTS...........................................................................38
SCHEDULE II
CREDIT AND COLLECTION POLICY............................................................................40
SCHEDULE III
TRADENAMES, FICTITIOUS NAMES AND "DOING BUSINESS AS" NAMES..............................................41
SCHEDULE IV
[RESERVED]..............................................................................................42
SCHEDULE V
LOCATION OF RECEIVABLE FILES............................................................................43
SCHEDULE VI
INSURANCE...............................................................................................44
EXHIBIT A
[FORM OF]
REQUEST NOTICE..........................................................................................45
EXHIBIT B
LIST OF DELIVERIES FOR ALL PURCHASES....................................................................48
</TABLE>
iii
<PAGE> 5
EXHIBIT
- -------
EXHIBIT A Form of Request Notice For Initial and Incremental Purchases
EXHIBIT B Form of List of Deliveries for all Advances
EXHIBIT C List of Resorts
EXHIBIT D Form of Monthly Report
EXHIBIT E Form of Opinion of Counsel for Seller
EXHIBIT F Provisions of Seller's Certificate of Incorporation
EXHIBIT G Form of Servicer's Certificate
EXHIBIT H Form of Assignment
EXHIBIT I Form of Subsequent Transfer Agreement
ANNEXES
- -------
Definitions Annex
iv
<PAGE> 6
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "AGREEMENT") is made as of June 26,
1998, among:
(1) Bluegreen Receivables Finance Corporation III, a Delaware
corporation ("FUNDING CORP"), as Seller (in such capacity, the
"SELLER");
(2) Bluegreen Corporation, a Massachusetts corporation
("BLUEGREEN"), as originator and owner of the Receivables
prior to their conveyance to Funding Corp under the Sale and
Contribution Agreement (in such capacity, together with its
permitted successors and assigns, the "ORIGINATOR") and in its
separate capacity as Servicer (in such capacity, together with
its permitted successors and assigns, the "SERVICER");
(3) U.S. Bank National Association, as Cash Administrator (the
"CASH ADMINISTRATOR");
(4) BRFC III Deed Corporation, a Delaware corporation ("DEED
CORP"), solely as the agent and custodian for the benefit of
the Purchaser of certain deeds relating to certain Receivables
represented by conditional sales contracts (in such capacity,
the "DEED CUSTODIAN"); and
(5) Heller Financial, Inc., a Delaware corporation ("HFI"), as
Purchaser (in such capacity, together with its successors and
assigns, the "PURCHASER").
W I T N E S S E T H:
WHEREAS, the Seller is a wholly-owned, special-purpose
bankruptcy-remote subsidiary of the Originator;
WHEREAS, the Seller has been formed for the sole purpose of purchasing
and selling certain Receivables and related Assets originated or otherwise
acquired and owned by the Originator in the ordinary course of the Originator's
business and sold or contributed to the Seller from time to time pursuant to the
Sale and Contribution Agreement by and between the Originator and the Seller;
WHEREAS, the Seller wishes to sell the Receivables and related Assets,
and the Purchaser wishes to purchase the Receivables and the related Assets
pursuant to the terms and conditions contained herein;
WHEREAS, the Deed Custodian is a wholly-owned, special-purpose
subsidiary of the Seller;
<PAGE> 7
WHEREAS, the Deed Custodian has been formed for the sole purpose of
holding certain Deeds relating to Receivables sold pursuant to this Agreement
that are in the form of conditional sales contracts as agent and custodian for
the benefit of the Purchaser;
WHEREAS, the Cash Administrator has been requested and is willing to
provide certain administrative services on behalf of the Purchaser with respect
to Collections and associated investments, payments and distributions thereof in
accordance with the terms hereof;
WHEREAS, Bluegreen and Deed Corp are willing and have agreed pursuant
hereto and to the Servicing Agreement and the Deed Custodian Agreement,
respectively, executed contemporaneously herewith, to act as Servicer and Deed
Custodian, respectively, for the Assets and the Deeds and to perform the
Servicer's and Deed Custodian's respective obligations and responsibilities
under the Servicing Agreement, the Deed Custodian Agreement and hereunder; and
WHEREAS, it is the intention of the Seller and the Purchaser that the
transactions contemplated by this Agreement constitute a sale and absolute
transfer of ownership of the Assets.
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 CERTAIN DEFINED TERMS.
All capitalized terms used and not expressly defined herein, shall have
the meaning specified in the Definitions Annex attached to this Agreement (the
"DEFINITIONS ANNEX").
Section 1.2 OTHER INTERPRETIVE PROVISIONS.
Except to the extent otherwise specified in the particular term or
provision at issue, this Agreement (including the Definitions Annex hereto)
shall be interpreted and construed in accordance with the Document Conventions.
ARTICLE II
THE PURCHASE FACILITY
Section 2.1 SALE AND PURCHASE OF ASSETS.
(a) Subject to the terms and conditions of this Agreement, the Seller
may, at its option, sell and assign to the Purchaser the Assets from time to
time designated and identified for purchase
2
<PAGE> 8
in accordance with Section 2.2 hereof, and the Purchaser agrees to make such
purchases from time to time (the first such date, the "INITIAL PURCHASE DATE")
during the period from the Closing Date to but not including the Termination
Date or the Program Termination Date (the first such sale and purchase to be
effected hereunder, the "INITIAL PURCHASE"; each subsequent sale and purchase,
an "INCREMENTAL PURCHASE"; and any such sale and purchase, a "PURCHASE"). Under
no circumstances, however, shall the Purchaser be obligated to make any Purchase
if, after giving effect to the payment of the Cash Purchase Price relating to
such Purchase, either (i) the aggregate Capital Payout hereunder would exceed
the Purchase Limit, or (ii) the aggregate Capital outstanding would exceed the
Capital Limit. Upon the payment of the related Cash Purchase Price for the
Initial Purchase or any Incremental Purchase, the Seller shall have, and shall
be deemed hereunder to have, irrevocably sold, assigned, transferred and
conveyed to the Purchaser, without recourse, representation or warranty, express
or implied, except as provided in the Transaction Documents, all right, title
and interest of the Seller in and to the Assets relating to such Initial
Purchase or Incremental Purchase, as the case may be.
(b) The purchase price ("PURCHASE PRICE") for the Purchased Receivables
in each Asset Pool Portion shall consist of the Cash Purchase Price plus the
Deferred Payment. The "CASH PURCHASE PRICE" shall be an amount equal to the
product of (i) the Receivable Balance as of the Cutoff Date of the Eligible
Receivables to be purchased, multiplied by (ii) the Credit Enhancement Factor.
Subject to the satisfaction of the conditions and on the terms set forth herein,
the Purchaser shall pay to the Seller the Cash Purchase Price for the Purchased
Receivable on the related Purchase Date in accordance with the provisions of
Section 2.2(b). The Deferred Payment with respect to the Purchased Receivables
shall be determined and paid in accordance with the provisions of Sections
2.6(xi) and 2.7(xi).
(c) Upon payment of the Cash Purchase Price by the Purchaser in the
amount determined in accordance with Section 2.1(b) and Section 2.2(b) with
respect to all Assets purchased on a Purchase Date, the ownership of all such
Assets will be solely vested in the Purchaser. Neither the Originator, Servicer,
Seller nor Deed Corp shall take any action inconsistent with such ownership and
shall not claim any ownership interest in any Purchased Receivable or related
Asset. The Seller, Originator, Servicer and Deed Custodian shall each indicate
in their respective books and records that ownership of each Purchased
Receivable and related Asset is held by the Purchaser. In addition, the Seller
shall respond to any inquiries with respect to ownership of the Assets by
stating that it is no longer the owner of the Assets and that ownership of the
Assets is held by the Purchaser. Any documents (including deeds) relating to the
Purchased Receivables retained by the Seller, the Originator or the Deed
Custodian shall be held in trust by the Seller, the Originator (in its capacity
as the Servicer) and the Deed Custodian (as agent and custodian for the
Purchaser), for the benefit of the Purchaser as owner thereof, and possession of
any incident of ownership relating to the Purchased Receivables so retained is
for the sole purpose of facilitating the servicing of the Purchased Receivables
and in the case of the Deed Custodian for administrative ease of transfer of
deeds upon payment in full by the Obligor of the Receivables in the form of
conditional sales contracts, or otherwise at the direction of the Purchaser.
Such retention and possession is at the will of the Purchaser and in a custodial
capacity for the benefit of the Purchaser and its assignees only.
3
<PAGE> 9
The Purchaser may direct the Deed Custodian at any time to transfer any deed(s)
relating to any Receivable purchased hereunder to Purchaser or its nominee;
PROVIDED that any such transfer will be made subject to the conditional sales
contract relating thereto, if any.
Section 2.2 PROCEDURES FOR PURCHASES.
(a) No later than 10:00 a.m. (Chicago, Illinois time) on a date which
is at least five (5) Business Days before any intended Purchase Date, the Seller
will deliver or cause to be delivered to the Purchaser a Request Notice
substantially in the form of EXHIBIT A hereto; provided, however, if the
Purchase relates to Receivables and related Assets which are financed through a
source other than the Warehouse Facility, such Request Notice shall be provided
at least ten (10) Business Days prior to the intended Purchase Date. In the
event that the Seller does not provide a properly completed Request Notice (and
subject to all other terms and conditions to such Purchase hereunder), the
Purchaser will not be obligated to purchase Eligible Receivables on such
intended Purchase Date until such time as such terms and conditions are met.
Each such Request Notice shall specify, among other things, (i) the aggregate
amount of such Purchase, which shall be in a minimum amount equal to
$10,000,000, or such lesser amount as may be equal to the then unused portion of
the Purchase Limit, (ii) the intended Purchase Date for such Purchase, and (iii)
the aggregate Capital Payout, Capital outstanding, and the Capital Limit, both
immediately preceding and after giving effect to such Purchase.
(b) On each Purchase Date, and subject to the satisfaction of the
conditions of Article IV, the Servicer will prepare and deliver an Assignment to
the Seller and Purchaser in the form of EXHIBIT H hereto with respect to the
Purchased Receivables being purchased on such Purchase Date by the Purchaser.
The Seller shall thereupon execute such Assignment and deliver executed copies
thereof to the Servicer who will in turn cause a fully executed copy of such
Assignment to be delivered to the Purchaser and the Custodian. The Purchaser
shall thereupon pay to the Seller for such Purchased Receivables the Cash
Purchase Price, by wire transfer in same day funds in accordance with the wire
transfer instructions specified in the related Request Notice. The Seller shall
be solely responsible for obtaining ownership of the Purchased Receivables from
the Originator, pursuant to the Sale and Contribution Agreement, prior to
transfer of ownership of such Purchased Receivables to the Purchaser under this
Agreement.
Section 2.3 ESTABLISHMENT OF ACCOUNTS; RESERVE ACCOUNT.
(a) Prior to or simultaneously with the execution and delivery of this
Agreement, the Purchaser and the Cash Administrator shall (i) establish an
Eligible Deposit Account in the name of the Purchaser, titled "HELLER LOCKBOX
ACCOUNT RE BLUEGREEN RECEIVABLES ASSET PURCHASE AGREEMENT" (the "LOCKBOX
ACCOUNT"), and (ii) enter into the Lockbox Agreement.
(b) Prior to or simultaneously with the execution and delivery of this
Agreement, the Purchaser and the Cash Administrator shall establish an Eligible
Deposit Account in the name of the Purchaser titled "HELLER FACILITY COLLECTION
ACCOUNT RE BLUEGREEN RECEIVABLES ASSET PURCHASE
4
<PAGE> 10
AGREEMENT" (the "COLLECTION ACCOUNT").
(c) Each of the Originator, Seller and the Servicer shall deposit all
Collections it may receive in respect of Purchased Receivables into the Lockbox
Account no later than the second Business Day following the date of receipt
thereof. Any collections in respect of Purchased Receivables held by the
Originator, Seller or Servicer pending transfer to the Lockbox Account shall be
held in trust for the benefit of the Purchaser until such amounts are deposited
into the Lockbox Account.
(d) Prior to or simultaneously with the execution and delivery of this
Agreement, the Purchaser and the Cash Administrator shall establish an Eligible
Deposit Account in the name of the Purchaser titled "HELLER/BLUEGREEN FACILITY
RESERVE ACCOUNT" (the "RESERVE ACCOUNT").
(e) Prior to the Termination Date, on or prior to each Payment Date
(and in anticipation of allocations and distributions to be made on such Payment
Date pursuant to Section 2.6), the Servicer in consultation with the Purchaser,
and based upon information provided in the Monthly Report delivered by the
Servicer to the Purchaser two (2) Business Days prior to the related Payment
Date unless the Receivables or the cash flows therein shall be sold to a third
party in which case the Servicer shall provide such Monthly Report three (3)
Business Days prior to the related Payment Date, shall determine the extent to
which Available Amounts in the Collection Account (including proceeds of any
Servicer Advance deposited therein in accordance with Section 5.18 of the
Servicing Agreement) are insufficient to pay Cash Administrator Fees, Lockbox
Fees, Back-Up Servicer Fees, Custodian Fees, Unreimbursed Servicer Advances,
Protective Advances, Servicing Fees (to the extent applicable) as well as the
Yield and Capital Payment Amount distributions required on such Payment Date. To
the extent of such insufficiency, amounts held in the Reserve Account shall be
transferred to the Collection Account, treated as Available Amounts for such
Payment Date and thereafter applied in order for any of such payments or
allocations to be made pursuant to Section 2.6. In addition, to the extent that
after giving effect to the payments and allocations to be made pursuant to
Section 2.6, amounts held in the Reserve Account will exceed the then-applicable
Reserve Account Required Amount, such excess shall be transferred to the
Collection Account and applied and allocated as Available Amounts on the Payment
Date with respect to the related Collection Period under Section 2.6.
(f) On the Payment Date first occurring on or after the occurrence of
the Termination Date, all amounts held in the Reserve Account shall be
transferred to the Collection Account, treated as Available Amounts on such
Payment Date and applied to payments or allocations required to be made pursuant
to Section 2.7.
Section 2.4 [OMITTED].
Section 2.5 DEPOSITS TO ACCOUNTS.
On each Monday, Wednesday, and Friday (or, if any Monday, Wednesday or
Friday is not a Business Day, then on the next succeeding Business Day) pursuant
to the Lockbox Agreement, all
5
<PAGE> 11
Collections in the Lockbox Account shall be transferred by automated wire by the
Lockbox Bank to the Collection Account. In addition, the proceeds of Servicer
Advances made pursuant to Section 5.18 of the Servicing Agreement, transfers
from the Reserve Account made pursuant to Section 2.3(e) or (f), and payments of
any Transfer Deposit Amount received from the Originator or Seller shall be
deposited to the Collection Account.
Section 2.6 NON-LIQUIDATION SETTLEMENT PROCEDURES.
Prior to the Termination Date, on each Payment Date, the Cash
Administrator shall pay to the following Persons, from the Collection Account,
to the extent of Available Amounts on deposit in the Collection Account with
respect to the related Collection Period (and after giving effect to any
transfers into the Collection Account contemplated in Section 2.3(e)), the
following amounts in the following order of priority:
(i) first, to the Cash Administrator, any accrued and unpaid Cash
Administrator Fees and to the Lockbox Bank, any accrued and
unpaid Lockbox Fees;
(ii) second, to the Back-up Servicer, any accrued and unpaid
Back-up Servicer Fees and to the Custodian, any accrued and
unpaid Custodian Fees;
(iii) third, to the Servicer, any Unreimbursed Servicer Advances
(which reimbursement shall be applicable to any Predecessor
Servicer);
(iv) fourth, to the Deed Custodian to allow the Deed Custodian to
make Protective Advances;
(v) fifth, to any Servicer which is the Servicer by virtue of a
Servicer Transfer, and which Servicer is not Bluegreen or any
Affiliate thereof, to such Servicer, any accrued and unpaid
Servicing Fees;
(vi) sixth, to any Servicer or any subservicer (if applicable)
which is the Servicer by virtue of a Servicer Transfer, and
which Servicer or subservicer is not Bluegreen or any
Affiliate thereof, to such Servicer or subservicer any accrued
and unpaid Remarketing Fees;
(vii) seventh, to the Purchaser, an amount equal to the accrued and
unpaid Yield, Yield on Yield and Volume Yield;
(viii) eighth, to the Purchaser, an amount equal to the Capital
Payment Amount;
(ix) ninth, to the Servicer, any accrued and unpaid Servicing Fees
(to the extent not paid under clause (v) above);
6
<PAGE> 12
(x) tenth, to the Servicer for accrued and unpaid Remarketing
Fees;
(xi) eleventh, to the Cash Administrator, for deposit into the
Reserve Account, an amount up to that required to cause the
amounts on deposit in the Reserve Account to equal the Reserve
Account Required Amount;
(xii) twelfth, to the Purchaser, any amounts due and owing under
Section 12.9 hereof and not paid by the Seller pursuant to
such Section; and
(xiii) thirteenth, any remaining amounts to the Seller, as a deferred
payment for the Assets in the Asset Pool as of or prior to the
end of the related Collection Period (each such payment, a
"DEFERRED PAYMENT").
Section 2.7 LIQUIDATION SETTLEMENT PROCEDURES.
On or after the occurrence of the Termination Date, on each Payment
Date, the Cash Administrator shall pay to the following Persons, from the
Collection Account, to the extent of Available Funds on deposit in the
Collection Account (and after giving effect to the transfers into the Collection
Account contemplated in Section 2.3(f)), the following amounts in the following
order of priority:
(i) first, to the Cash Administrator, any accrued and unpaid Cash
Administrator Fees and to the Lockbox Bank, any accrued and
unpaid Lockbox Fees;
(ii) second, to the Back-up Servicer, any accrued and unpaid
Back-up Servicer Fees and Audit Expenses incurred by the
Back-up Servicer and to the Custodian, any accrued and unpaid
Custodian Fees;
(iii) third, to the Servicer, any Unreimbursed Servicer Advances
(which reimbursement shall be applicable to any Predecessor
Servicer);
(iv) fourth, to the Deed Custodian to allow the Deed Custodian to
make Protective Advances;
(v) fifth, to any Servicer which is the Servicer by virtue of a
Servicer Transfer and which Servicer is not Bluegreen or any
Affiliate thereof, to such Servicer, any accrued and unpaid
Servicing Fees;
(vi) sixth, to any Servicer or any subservicer (if applicable)
which is the Servicer by virtue of a Servicer Transfer, and
which Servicer or subservicer is not Bluegreen or any
Affiliate thereof, to such Servicer or subservicer any accrued
and unpaid Remarketing Fees;
7
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(vii) seventh, to the Purchaser, an amount equal to the accrued and
unpaid Yield, Yield on Yield and Volume Yield;
(viii) eighth, to the Purchaser, an amount equal to the Capital
Payment Amount;
(ix) ninth, to the Servicer, any accrued and unpaid Servicing Fees
(to the extent not paid under clause (v) above);
(x) tenth, to the Servicer for accrued and unpaid Remarketing
Fees;
(xi) eleventh, to the Purchaser, any and all remaining Available
Amounts until such time as Capital is reduced to zero (0) as
well as any other amounts outstanding and unpaid hereunder;
(xii) twelfth, to the Purchaser, any amounts due and owing under
Section 12.9 hereof and not paid by the Seller pursuant to
such Section; and
(xiii) thirteenth, any remaining amounts to the Seller as a final
Deferred Payment.
Section 2.8 INVESTMENT OF ACCOUNTS.
Subject to the provisions of this Section 2.8, amounts on deposit in
any Trust Account shall be invested in Permitted Investments. Until the
Termination Date, the Cash Administrator shall invest all such amounts in
Permitted Investments selected by the Purchaser by written notice to the Cash
Administrator, that mature no later than the immediately succeeding Payment
Date. On and after the Termination Date, any investment of such amounts in
Permitted Investments shall be solely at the discretion of the Purchaser. All
Investment Earnings shall be deposited into the Collection Account as and when
received and shall be applied and disbursed in the same manner and priority as
all other amounts in the Collection Account.
Section 2.9 PAYMENTS AND COMPUTATIONS; FUNDING INDEMNITY FOR
FAILED PURCHASE.
(a) All amounts to be paid or deposited by the Originator, Seller,
Servicer or any other applicable payor referred to hereunder shall be paid or
deposited in accordance with the terms hereof no later than 1:00 p.m. (Chicago,
Illinois time) on the day when due in lawful money of the United States in
immediately available funds, and if not so timely deposited, shall be deemed to
have been received on the following Business Day.
(b) Whenever any payment hereunder shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of Yield, Yield on Yield or any fee payable hereunder, as
the case may be.
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(c) If any Purchase requested by the Seller pursuant to Section 2.2 is
not for any reason whatsoever made or effectuated, as the case may be, on the
date specified therefor, the Seller and Originator, jointly and severally, shall
be obligated to indemnify the Purchaser against any loss, cost or expense
incurred by such Purchaser, including, without limitation, any loss, cost or
expense incurred by such Purchaser (as reasonably determined by such Purchaser)
as a result of the liquidation or redeployment of deposits or other funds
acquired by such Purchaser to fund or maintain such Purchase, as the case may
be; PROVIDED, that no such indemnification shall be required if any Purchase is
not made or effectuated as a result of any action or inaction by the Purchaser,
other than a failure by such Purchaser to make any Purchase due to a failure of
any condition precedent to such purchase set forth herein.
Section 2.10 [OMITTED].
Section 2.11 ADDITION/SUBSTITUTION OF RECEIVABLES.
(a) On any day prior to the Termination Date provided it is done no
more than once each Collection Period, and subject to the terms and conditions
hereof, the Seller may at its option replace a Purchased Receivable currently in
the Asset Pool (a "REPLACED RECEIVABLE") with one or more Subsequent
Receivables; provided, that the aggregate Receivable Balances of all Replaced
Receivables since the Initial Cutoff Date shall not, at any date of
determination, exceed an amount equal to ten percent (10.00%) of the aggregate
Receivable Balance of all Receivables sold by the Seller to the Purchaser
pursuant to this Agreement as of such date. Subject to the conditions set forth
in paragraph (b) below, the Seller if exercising such option shall sell,
transfer, assign, set over and otherwise convey to the Purchaser, without
recourse other than as expressly provided in the Transaction Documents, (i) all
the Seller's right, title and interest in and to the Subsequent Receivables
listed on the related Subsequent List of Receivables (including, without
limitation, all Collections and rights to receive Collections with respect
thereto on or after the related Subsequent Cutoff Date, but excluding any
collections or rights to receive payments which were collected pursuant thereto
prior to such Subsequent Cutoff Date), and (ii) all other rights and property
interests consisting of Assets related to such Subsequent Receivables (the
property in clauses (i)-(ii) above, upon such transfer, becoming part of the
Asset Pool).
(b) The Seller may transfer to the Purchaser the Subsequent Receivables
and the other property and rights related thereto described in paragraph (a)
above only upon the satisfaction of each of the following conditions on or prior
to the related Subsequent Transfer Date (and the delivery of a related Addition
Notice by the Seller shall be deemed a representation and warranty by the
Seller, that such conditions have been or will be, as of the related Subsequent
Transfer Date, satisfied):
(i) The Seller shall have provided the Purchaser with a timely
Addition Notice complying with the definition thereof;
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(ii) the Subsequent Receivable(s) being conveyed to the Purchaser,
satisfy the Subsequent Receivable Qualification Conditions;
(iii) after giving effect to such conveyance, the Subsequent
Receivable Transfer Conditions shall remain satisfied;
(iv) the Seller shall have delivered to the Purchaser a duly
executed written assignment, in substantially the form of
EXHIBIT I hereto (the "SUBSEQUENT TRANSFER AGREEMENT"), which
shall include a Subsequent List of Receivables listing the
Subsequent Receivables;
(v) the Seller shall have deposited or caused to be deposited in
the Collection Account all Collections received with respect
to the Subsequent Receivables on or after the related
Subsequent Cutoff Date;
(vi) as of each Subsequent Transfer Date, both the Originator and
the Seller were Solvent and the conveyance would not have the
effect of rendering either no longer Solvent;
(vii) no selection procedures believed by the Originator or the
Seller to be adverse to the interests of the Purchaser shall
have been utilized in selecting the Subsequent Receivables;
(viii) each of the representations and warranties made by the
Originator pursuant to Article III of the Sale and
Contribution Agreement applicable to the Subsequent
Receivables shall be true and correct as of the related
Subsequent Transfer Date, and the Originator shall have
performed all obligations to be performed by it hereunder or
thereunder on or prior to such Subsequent Transfer Date; and
(ix) the Originator shall, at its own expense, on or prior to the
Subsequent Transfer Date, have indicated in its Computer Disk
and Records that the Subsequent Receivables identified on the
Subsequent List of Receivables in the Subsequent Transfer
Agreement have been sold to the Purchaser through the Seller
pursuant to this Agreement and the Sale and Contribution
Agreement.
(c) In connection with any replacement of existing Receivables in the
Asset Pool with Subsequent Receivables effected in accordance with the terms
hereof, the Purchaser shall, automatically and without further action, be deemed
to transfer to the Seller, free and clear of any Lien created pursuant to this
Agreement, all of the right, title and interest of the Purchaser in, to and
under the related Replaced Receivable (including any Collections received with
respect thereto on or after the related Subsequent Cutoff Date), and the
Purchaser shall be deemed to represent and warrant that it has the corporate
authority and has taken all necessary corporate action to accomplish
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such transfer, but without any other recourse, representation or warranty,
express or implied.
Section 2.12 EXTENSION OF PROGRAM TERMINATION DATE; INCREASE IN
COMMITMENT.
(a) The Seller may, within 180 days, but no later than 120 days, prior
to the then applicable Program Termination Date, by written notice to the
Purchaser, make written request for the Purchaser to extend the Program
Termination Date for an additional period of 364 days. The Purchaser shall make
a determination, in its sole discretion and after a full credit review, not less
than 90 days prior to the then applicable Program Termination Date as to whether
or not it will agree to extend the Program Termination Date; PROVIDED, HOWEVER,
that the failure of the Purchaser to make a timely response to the Seller's
request for extension of the Program Termination Date shall be deemed to
constitute a refusal by the Purchaser to extend the Program Termination Date.
The Program Termination Date shall only be extended upon the written consent of
the Purchaser.
(b) At any time after the Closing Date, the Seller may, by written
notice to the Purchaser delivered at least 20 Business Days prior to a Purchase
Date, request an increase in the Purchase Limit; PROVIDED that any such increase
must be in a minimum amount of U.S. $50,000,000. The Purchaser in its sole
discretion may approve such request for an increase in the Purchase Limit, which
increase shall become effective only upon receipt by the Seller of written
confirmation of the Purchaser's consent to such increase, which specifies the
Purchase Limit as so increased.
ARTICLE III
[RESERVED]
ARTICLE IV
CONDITIONS OF PURCHASES
Section 4.1 CONDITIONS PRECEDENT TO INITIAL PURCHASE.
The Initial Purchase hereunder is subject to the condition precedent
that the Purchaser shall have received on or before the date of such purchase
the items listed in SCHEDULE I, each (unless otherwise indicated) dated such
date, in form and substance satisfactory to the Purchaser.
Section 4.2 CONDITIONS PRECEDENT TO ALL PURCHASES.
The Initial Purchase and each Incremental Purchase from the Seller by
the Purchaser shall be subject to the further conditions precedent that:
(a) with respect to any such Purchase (other than the Initial
Purchase) prior to the
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date of such Purchase,
(i) the Servicer shall have delivered to the Purchaser
(A) a completed Asset Report, in form and substance
reasonably satisfactory to the Purchaser,
substantially in the form of the Asset Report
referred to in Schedule I with respect to the Initial
Purchase, dated within five (5) Business Days prior
to the date of such Incremental Purchase and
containing such additional information as may be
reasonably requested by the Purchaser, and (B) a
Subsequent List of Receivables relating to such
Incremental Purchase, and (c) executed Assignments
(under both the Sale and Contribution Agreement and
this Agreement) relating thereto; and
(ii) the Receivables File with respect to such Asset Pool
Portion being purchased shall have been delivered
into the custody of the Purchaser (or arrangements
for custody thereof otherwise satisfactory to the
Purchaser shall have been implemented); and
(iii) all actions or additional actions necessary, in the
reasonable judgment of the Purchaser, to obtain an
absolute ownership interest in favor of the Purchaser
in the Asset Pool Portion being purchased shall have
been taken (and Purchaser may in its discretion
require, as a condition to such determination, the
delivery of an Opinion of Counsel to such effect);
(b) on the date of such Purchase the following statements shall be
true and the Seller by accepting the amount of such Purchase
shall be deemed to have certified that:
(i) the representations and warranties contained in
Sections 5.1 and 5.2 are true and correct on and as
of such day as though made on and as of such date,
(ii) no event has occurred and is continuing, or would
result from such Purchase which constitutes an Event
of Termination,
(iii) on and as of such day, after giving effect to such
Purchase, the Capital Payout will not exceed the
Purchase Limit, and the outstanding Capital will not
exceed the Capital Limit, and
(iv) on and as of such day, the Seller and the Servicer
each has performed all of the agreements contained in
this Agreement and the other
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Transaction Documents to be performed by such Person
at or prior to such day;
(c) no law, rule or regulation shall prohibit, and no order,
judgment or decree of any federal, state or local court or
government body, agency or instrumentality shall prohibit or
enjoin any of the activities of the Purchaser contemplated by
this Agreement;
(d) (i) no event has occurred under the Warehouse Facility that
would relieve Heller Financial, Inc. from making advances
under the Warehouse Facility and (ii) no Increased Cost Event
shall have occurred and be continuing;
(e) the Deed Custodian shall have received with respect to
Receivables either an original note/instrument and related
Allonge or the original conditional sales contract;
(f) the Deed Custodian shall have received either a Master Deed or
Deeds relating to the Intervals if the related Receivable is a
conditional sales contract;
(g) in the event the condition requiring the application of the
Interest Rate Environment Modifier exists, the Purchaser and
Seller shall have agreed to the Interest Rate Environment
Modifier; and
(h) the Purchaser shall have received such other approvals,
opinions or documents as the Purchaser may reasonably request.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Section 5.1 REPRESENTATIONS AND WARRANTIES OF THE SELLER.
The Seller represents and warrants, as of the Closing Date, each
Purchase Date and each Subsequent Transfer Date, as follows:
(a) ORGANIZATION AND GOOD STANDING. The Seller is a corporation duly
organized and validly existing in good standing under the laws of the State of
Delaware, and has full corporate power, authority and legal right to own its
properties and conduct its business as such properties are presently owned and
such business is presently conducted, and to execute, deliver and perform its
obligations under this Agreement and each other Transaction Document to which it
is a party.
(b) DUE QUALIFICATION. The Seller is duly qualified to do business
and is in good standing
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as a foreign corporation (or is exempt from such requirements), and has obtained
or will obtain all necessary licenses and approvals, in each jurisdiction in
which failure to so qualify or to obtain such licenses and approvals would have
a material adverse effect on its ability to perform its obligations hereunder.
(c) DUE AUTHORIZATION. The execution and delivery of this Agreement and
each other Transaction Document to which it is a party, and the consummation of
the transactions provided for herein and therein have been duly authorized by
the Seller by all necessary corporate action on the part of the Seller.
(d) NO CONFLICT. The execution and delivery of this Agreement and each
other Transaction Document to which it is a party, the performance of the
transactions contemplated hereby and thereby and the fulfillment of the terms
hereof and thereof will not conflict with, result in any breach of any of the
material terms and provisions of, or constitute (with or without notice or lapse
of time or both) a material default under, any material indenture, receivable,
agreement, mortgage, deed of trust, or other instrument to which the Seller is a
party (or by which it or any of its property is bound).
(e) NO VIOLATION. The execution and delivery of this Agreement and each
other Transaction Document to which it is a party, the performance of the
transactions contemplated hereby and thereby and the fulfillment of the terms
hereof and thereof (including, without limitation, the sale of Assets by the
Seller or remittance of Collections in accordance with the provisions of this
Agreement) will not conflict with or violate, in any material respect, any
Requirements of Law applicable to the Seller.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending
or, to the best knowledge of the Seller, threatened against the Seller, before
any court, regulatory body, administrative agency, or other tribunal or
governmental instrumentality (i) asserting the invalidity of this Agreement or
any other Transaction Document, (ii) seeking to prevent the consummation of any
of the transactions contemplated by this Agreement or any other Transaction
Document or (iii) seeking any determination or ruling that could reasonably be
expected to be adversely determined, and if adversely determined, would
materially and adversely affect the performance by the Seller of its obligations
under this Agreement or any Transaction Document.
(g) ALL CONSENTS REQUIRED. All approvals, authorizations, consents,
orders or other actions of any Person or of any Governmental Authority required
in connection with the Seller's execution and delivery of this Agreement and the
other Transaction Documents to which it is a party, the performance of the
transactions contemplated hereby and thereby, and the fulfillment of the terms
hereof and thereof, have been obtained.
(h) BULK SALES. The execution, delivery and performance of this
Agreement do not require compliance with any "BULK SALES" law by the Seller.
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(i) SOLVENCY. After giving effect to the transactions under this
Agreement, the Seller will be Solvent.
(j) SELECTION PROCEDURES. No selection procedures believed by the
Seller to be materially adverse to the interests of the Purchaser were utilized
by the Seller in selecting the Receivables in the Asset Pool.
(k) TAXES. The Seller has filed or caused to be filed all tax returns
which, to its knowledge, are required to be filed and has paid when due all
taxes shown to be due and payable on such returns or on any assessments made
against it or any of its property and all other taxes, fees or other charges
imposed on it or any of its property by any Governmental Authority (other than
any amount of tax due the validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which reserves in
accordance with generally accepted accounting principles have been provided on
the books of the Seller); no tax lien has been filed and, to the Seller's
knowledge, no claim is being asserted, with respect to any such tax, fee or
other charge.
(l) AGREEMENTS ENFORCEABLE. This Agreement and the other Transaction
Documents to which the Seller is a party constitute the legal, valid and binding
obligation of the Seller enforceable against the Seller in accordance with their
respective terms, except as such enforceability may be limited by (i) applicable
Insolvency Laws and (ii) general principles of equity (whether considered as a
suit at law or in equity) or implied covenants of good faith and fair dealing.
(m) EXCHANGE ACT COMPLIANCE. No proceeds of any Purchase will be used
by the Seller or the Originator to acquire any security in any transaction which
is subject to Section 13 or 14 of the Securities Exchange Act of 1934, as
amended.
(n) NO LIENS. Each Asset, together with the Receivable related thereto,
shall, immediately prior to its sale hereunder, be owned by the Seller free and
clear of any Lien (except Permitted Liens), and upon each Purchase, the
Purchaser shall acquire an undivided ownership interest in each Asset and in the
Collections with respect thereto, free and clear of any Lien (except Permitted
Liens). No effective financing statement or other instrument similar in effect
covering any Asset or the Collections with respect thereto shall at any time be
on file in any recording office except such as may be filed in favor of the
Purchaser relating to this Agreement, or in favor of the Seller as assignee of
the Originator.
(o) PURCHASE LIMIT AND CAPITAL LIMIT. The Capital Payout (after giving
effect to any current Purchase or conveyance of Receivables) does not exceed the
Purchase Limit; and the aggregate Capital outstanding (after giving effect to
any current Purchase or conveyance of Receivables) does not exceed the Capital
Limit.
(p) REPORTS ACCURATE. No Asset Report, exhibit, financial statement,
document, book, record or report furnished or to be furnished by the Seller to
the Purchaser in connection with this Agreement is or will be inaccurate in any
material respect as of the date it is or shall be dated or
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(except as otherwise disclosed to the Purchaser, as the case may be, at such
time) as of the date so furnished, and no such document contains or will contain
any material misstatement of fact or omits or shall omit to state a material
fact or any fact necessary in light of the circumstances under which made, to
make the statements contained therein not misleading.
(q) LOCATION OF OFFICES. The principal place of business and chief
executive office of the Seller and the Originator, and the office where the
Seller and Originator keep all the Records, are located at the addresses of the
Seller and Originator, respectively, referred to in Section 12.2 hereof (or at
such other locations as to which the notice and other requirements specified
herein shall have been satisfied).
(r) TRADENAMES. Except as described in SCHEDULE III, neither the Seller
nor the Originator has trade names, fictitious names, assumed names or "DOING
BUSINESS AS" names or other names under which either has done or is doing
business.
(s) SALE AND CONTRIBUTION AGREEMENT. The Sale and Contribution
Agreement is the only agreement pursuant to which the Seller acquires ownership
of the Receivables and related Assets.
(t) VALUE GIVEN. The Seller shall have given reasonably equivalent
value to the Originator in consideration for the transfer to the Seller of the
Assets under the Sale and Contribution Agreement, no such transfer shall have
been made for or on account of an antecedent debt owed by such Originator to the
Seller, and no such transfer is or may be voidable or subject to avoidance under
any section of the Bankruptcy Code.
(u) SPECIAL PURPOSE ENTITY. The Certificate of Incorporation of the
Seller includes substantially the provisions set forth on EXHIBIT F hereto, and
the Originator has confirmed in writing to the Seller that, so long as the
Seller is not "INSOLVENT" within the meaning of the Bankruptcy Code, the
Originator has covenanted in the Sale and Contribution Agreement that it will
not cause the Seller to file a voluntary petition under the Bankruptcy Code or
any other bankruptcy or insolvency laws.
(v) ACCOUNTING. The Originator and Seller each account for the transfer
from the Originator of interests in Assets and Collections under the Sale and
Contribution Agreement as sales of such Assets in its books, records and
financial statements, in each case consistent with GAAP and with the
requirements set forth herein.
(w) SEPARATE ENTITY. The Seller is operated as an entity with assets
and liabilities distinct from those of the Originator and any Affiliates thereof
(other than the Seller), and the Seller and Originator hereby acknowledge that
the Purchaser is entering into the transactions contemplated by this Agreement
in reliance upon the Seller's identity as a separate legal entity from the
Originator and from each such other Affiliate of the Originator.
(x) BACK-UP SECURITY INTEREST. It is the intention of the Originator
and Seller that the
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transactions contemplated by the Sale and Contribution Agreement and this
Agreement constitute an irrevocable sale, assignment and transfer of ownership
of the Receivables and related Assets transferred thereunder. Nevertheless, in
the event a court of competent jurisdiction were to ever determine that the
transactions contemplated by the Sale and Contribution Agreement and the this
Agreement were secured financings rather than "TRUE SALES", the Originator has
granted (and hereby grants to) the Seller in the Sale and Contribution Agreement
and the Seller by assignment of its rights hereunder has granted (and hereby
grants to) the Purchaser a "SECURITY INTEREST" (the term security interest, as
used throughout this Agreement, is used as defined in the UCC) in the
Receivables and related Assets being conveyed hereunder, which is enforceable in
accordance with the UCC upon execution and delivery of this Agreement. Upon the
filing of UCC-1 financing statements naming the Purchaser as secured party and
buyer and the Seller as debtor and seller, the Purchaser shall have a first
priority perfected security interest in the Assets and Collections. All filings
(including, without limitation, such UCC filings) as are necessary in any
jurisdiction to perfect the interest of the Purchaser in the Assets and
Collections have been (or prior to the applicable Purchase will be) made.
(y) INVESTMENT COMPANY AND PUBLIC UTILITY HOLDING COMPANY. Neither the
Originator nor the Seller is an "INVESTMENT COMPANY" within the meaning of and
subject to regulation under the Investment Company Act of 1940, as amended, or a
"HOLDING COMPANY" or a "SUBSIDIARY COMPANY" of a "HOLDING COMPANY," within the
meaning of the Public Utility Holding Company Act of 1935, as amended.
(z) ACCURACY OF REPRESENTATIONS AND WARRANTIES. Each representation or
warranty by the Seller contained herein or in any certificate or other document
furnished by the Seller pursuant hereto or in connection herewith is when
furnished true and correct in all material respects; provided, however,
Purchaser acknowledges that with respect to the condition of a Receivable as an
"ELIGIBLE RECEIVABLE" as of their date of Purchase hereunder, Purchaser's remedy
for a breach of a representation or warranty relating to their status as an
Eligible Receivable is provided by Section 6.3 hereof.
(aa) YEAR 2000. Seller has made an assessment of the microchip and
computer-based systems and the software used in its business and based upon such
assessment believes that it will be "YEAR 2000 COMPLIANT" by January 1, 2000.
For purposes of this Section 5.1, "YEAR 2000 COMPLIANT" means that all software,
embedded microchips and other processing capabilities utilized by, and material
to the business operations or financial condition of, the Seller are able to
interpret, store, transmit, receive and manipulate data on and involving all
calendar dates correctly and without causing any abnormal ending scenarios in
relation to dates in and after the year 2000. From time to time, at the request
of the Purchaser, Seller shall provide to Purchaser such updated information as
is requested regarding the status of its effort to become Year 2000 Compliant.
The representations and warranties set forth in this section shall survive the
transfer of the Assets to the Purchaser, and termination of the rights and
obligations of the Servicer pursuant to the Servicing Agreement. Upon discovery
by the Seller, the Servicer or the Purchaser of a breach of any
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of the foregoing representations and warranties, the party discovering such
breach shall give prompt written notice to the others.
Section 5.2 REPRESENTATIONS AND WARRANTIES OF SELLER RELATING TO THE
AGREEMENT AND THE RECEIVABLES.
The Seller hereby represents and warrants to the Purchaser that, as of
the Closing Date, each Purchase Date and as of each Subsequent Transfer Date:
(a) BINDING OBLIGATION; VALID SALE AND TRANSFER OF OWNERSHIP;
PRECAUTIONARY GRANT OF SECURITY INTEREST.
(i) This Agreement and each other Transaction Document to
which the Seller is a party constitutes a legal,
valid and binding obligation of the Seller,
enforceable against the Seller in accordance with its
terms, except as such enforceability may be limited
by Insolvency Laws and except as such enforceability
may be limited by general principles of equity
(whether considered in a suit at law or in equity).
(ii) It is the expressed intention of Seller and Purchaser
that this Agreement constitutes an irrevocable true
sale and transfer of ownership from Seller to the
Purchaser of all right, title and interest of Seller
in, to and under the Assets, and that such transfer
be free and clear of any Lien of any Person claiming
through or under the Seller or its Affiliates, except
for Permitted Liens. Nevertheless, in the event a
court of competent jurisdiction were to determine
that the transactions contemplated by this Agreement
constitute a secured financing rather than a true
sale, Seller hereby grants, as a precautionary
measure, a security interest in such Assets to the
Purchaser. Upon the filing of the financing
statements described in Section 5.1(x) and, in the
case of Incremental Purchases or Subsequent
Receivables on the applicable Incremental Purchase
Date or Subsequent Transfer Date, as applicable, the
Purchaser shall have a first priority perfected
security interest in such property, subject only to
Permitted Liens. Neither the Seller nor any Person
claiming through or under Seller shall have any claim
to or interest in the Collection Account, except to
the extent set forth in Sections 2.6 and 2.7, as
applicable, and, if, notwithstanding the expressed
intention of the parties hereto, this Agreement
constitutes the grant of a security interest (for
collateral purposes) in such property, except for the
interest of Seller in such property as a debtor for
purposes of the UCC.
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(b) ELIGIBILITY OF RECEIVABLES. As of the initial Cutoff Date,
(i) the List of Receivables and the Asset Report
delivered in connection therewith is an accurate and
complete listing in all material respects of all the
Receivables in and to become part of the Asset Pool
as of the Cutoff Date and the information contained
therein (including with respect to the identity of
such Receivables, Obligors thereon, and the amounts
owing thereunder) is true and correct in all material
respects as of the Cutoff Date, and
(ii) each such Receivable is an Eligible Receivable,
(iii) each such Receivable and the related Assets has been
transferred to the Purchaser free and clear of any
Lien of any Person (other than Permitted Liens) and
in compliance, in all material respects, with all
Requirements of Law applicable to the Seller, and
(iv) with respect to each such Receivable, all material
consents, licenses, approvals or authorizations of or
registrations or declarations with any Governmental
Authority required to be obtained, effected or given
by Seller in connection with the transfer of such
Receivable and the related Assets to the Purchaser
have been duly obtained, effected or given and are in
full force and effect.
On each Incremental Purchase Date or Subsequent Transfer Date, the
Seller shall be deemed to represent and warrant to the Purchaser that
(I) the Subsequent List of Receivables and the Asset
Report delivered in connection therewith is an
accurate and complete listing in all material
respects of all the Receivables then in, and as a
result of such Incremental Purchaser or Subsequent
Transfer to become part of, the Asset Pool as of the
applicable Cutoff Date and the information contained
therein (including with respect to the identity of
such Receivables, Obligors thereon, and the amounts
owing thereunder) is true and correct in all material
respects as of the applicable Cutoff Date,
(II) each Receivable transferred on such day is an
Eligible Receivable,
(III) each such Receivable and the related Assets has been
transferred to the Purchaser free and clear of any
Lien of any Person (other than Permitted Liens) and
in compliance, in all material respects, with all
Requirements of Law applicable to Seller or the
Originator thereof,
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and
(IV) with respect to each such Receivable and related
Assets, all material consents, licenses, approvals or
authorizations of or registrations or declarations
with any Governmental Authority required to be
obtained, effected or given by the Seller in
connection with the transfer of such Receivable and
related Assets to the Purchaser have been duly
obtained, effected or given and are in full force and
effect.
(c) NOTICE OF BREACH. The representations and warranties set forth in
this Section 5.2 shall survive the transfer of the respective Receivables and
related Assets, or interests therein, to the Purchaser. Upon discovery by the
Seller, the Servicer or the Purchaser of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the others.
ARTICLE VI
GENERAL COVENANTS OF THE SELLER
Section 6.1 GENERAL COVENANTS.
Until the date on which all Aggregate Unpaids following the Termination
Date or Program Termination Date have been indefeasibly paid in full, the Seller
hereby covenants that:
(a) COMPLIANCE WITH LAWS; PRESERVATION OF CORPORATE EXISTENCE. The
Seller will comply in all material respects with all applicable laws, rules,
regulations and orders and preserve and maintain its corporate existence,
rights, franchises, qualifications and privileges.
(b) [OMITTED].
(c) SECURITY INTERESTS. Except for the transfers hereunder, the Seller
will not sell, pledge, assign or transfer to any other Person, or grant, create,
incur, assume or suffer to exist any Lien on any Receivable in the Asset Pool or
related Interval, whether now existing or hereafter transferred hereunder, or
any interest therein, and the Seller will not sell, pledge, assign or suffer to
exist any Lien on its interest, if any, hereunder. The Seller will immediately
notify the Purchaser of the existence of any such Lien on any Receivable in the
Asset Pool or related Interval; and the Seller shall defend the right, title and
interest of the Purchaser in, to and under the Receivables in the Asset Pool and
the related Interval, against all claims of third parties; PROVIDED, HOWEVER,
that nothing in this Section 6.l(c) shall prevent or be deemed to prohibit the
Seller from suffering to exist Permitted Liens upon any of the Receivables in
the Asset Pool or any related Interval.
(d) COMPLIANCE WITH LAW. The Seller hereby agrees to comply in all
material respects with all Requirements of Law applicable to the Seller, the
Receivables and the Intervals.
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(e) ACTIVITIES OF SELLER. The Seller shall not engage in any business
or activity of any kind, or enter into any transaction or indenture, mortgage,
instrument, agreement, receivable, lease or other undertaking, which is not
directly related to the transactions contemplated and authorized by this
Agreement, the other Transaction Documents and its Certificate of Incorporation.
(f) AGREEMENTS. The Seller shall not become a party to, or permit any
of its properties to be bound by, any indenture, mortgage, instrument,
receivable, agreement, lease or other undertaking, except this Agreement and the
other Transaction Documents, or amend or modify the provisions of its
Certificate of Incorporation, or issue any power of attorney except to the
Purchaser or the Servicer.
(g) SEPARATE CORPORATE EXISTENCE. The Seller shall:
(i) Maintain its own deposit account or accounts,
separate from those of any Affiliate, with commercial
banking institutions. The funds of the Seller will
not be diverted to any other Person or for other than
corporate uses of the Seller.
(ii) Ensure that, to the extent that it shares the same
officers or other employees as any of its
stockholders or Affiliates, the salaries of and the
expenses related to providing benefits to such
officers and other employees shall be fairly
allocated among such entities, and each such entity
shall bear its fair share of the salary and benefit
costs associated with all such common officers and
employees.
(iii) Ensure that, to the extent that it and Originator
(together with their respective stockholders or
Affiliates) jointly does business with vendors or
service providers or share overhead expenses, the
costs incurred in so doing shall be allocated fairly
among such entities, and each such entity shall bear
its fair share of such costs. To the extent that it
and the Originator (together with their respective
stockholders or Affiliates) does business with
vendors or service providers when the goods and
services provided are partially for the benefit of
any other Person, the costs incurred in so doing
shall be fairly allocated to or among such entities
for whose benefit the goods and services are
provided, and each such entity shall bear its fair
share of such costs. All material transactions
between Seller and any of its Affiliates shall be
only on an arm's length basis.
(iv) To the extent that Seller and any of its stockholders
or Affiliates have offices the same location, there
shall be a fair and appropriate allocation of
overhead costs among them, and each such entity shall
bear its fair share of such expenses.
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(v) Conduct its affairs strictly in accordance with its
Certificate of Incorporation and observe all
necessary, appropriate and customary corporate
formalities, including, but not limited to, holding
all regular and special stockholders' and directors'
meetings appropriate to authorize all corporate
action, keeping separate and accurate minutes of its
meetings, passing all resolutions or consents
necessary to authorize actions taken or to be taken,
and maintaining accurate and separate books, records
and accounts, including, but not limited to, payroll
and intercompany transaction accounts.
(h) LOCATION OF SELLER, RECORDS; INSTRUMENTS. The Seller (x) shall not
move outside the State of Florida, the location of its chief executive office,
without 30 days' prior written notice to the Purchaser and (y) shall not move or
permit the Servicer to move the location of the Receivable Files, other than to
the Custodian, from the locations thereof on the Initial Purchase Date, without
30 days' prior written notice to the Purchaser and (z) will promptly take all
actions required (including, but not limited to, all filings and other acts
necessary or advisable under the UCC of each relevant jurisdiction in order to
evidence the Purchaser's ownership interest (and back-up grant of a first
priority perfected security interest to the Purchaser) in all Receivables in the
Asset Pool. The Seller will give the Purchaser prompt notice of a change within
the State of Florida of the location of its chief executive office.
(i) ACCOUNTING FOR PURCHASES. The Seller will not account for or treat
(whether in financial statements or otherwise) the transactions contemplated
hereby or by the Sale and Contribution Agreements in any manner other than the
sale of Assets by the Seller to a Purchaser or the sale or contribution of the
Receivables and related Assets by the Originator to the Seller, as the case may
be.
(j) ERISA MATTERS. The Seller will not (a) engage in any prohibited
transaction for which an exemption is not available or has not previously been
obtained from the United States Department of Labor; (b) permit to exist any
accumulated funding deficiency, as defined in Section 302(a) of ERISA and
Section 412(a) of the Code, or funding deficiency with respect to any Benefit
Plan other than a Multiemployer Plan; (c) fail to make any payments to a
Multiemployer Plan that the Seller may be required to make under the agreement
relating to such Multiemployer Plan or any law pertaining thereto; (d) terminate
any Benefit Plan so as to result in any liability; or (e) permit to exist any
occurrence of any reportable event described in Title IV of ERISA which
represents a material risk of a liability of the Seller under ERISA or the Code.
(k) NATURE OF BUSINESS. The Seller will engage in no business other
than the purchase of Assets from the Originator, the sale of Assets to the
Purchaser and the other transactions permitted or contemplated by this
Agreement.
(l) ORIGINATOR ASSETS. With respect to each Asset acquired by the
Seller from the Originator, the Seller will (i) acquire such Asset pursuant to
and in accordance with the terms of the
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Sale and Contribution Agreement, (ii) take all action necessary to perfect,
protect and more fully evidence the Seller's ownership of such Asset, including,
without limitation, (A) filing and maintaining effective financing statements
(Form UCC-1) against the Originator in all necessary or appropriate filing
offices, and filing continuation statements, amendments or assignments with
respect thereto in such filing offices, and (B) executing or causing to be
executed such other instruments or notices as may be necessary or appropriate,
and (iii) take all additional action that the Purchaser may reasonably request
to perfect, protect and more fully evidence the respective interests of the
parties to this Agreement in the Assets.
(m) TRANSACTIONS WITH AFFILIATES. The Seller will not enter into, or be
a party to, any transaction with any of its Affiliates, except (i) the
transactions permitted or contemplated by this Agreement and the other
Transaction Documents, and (ii) other transactions (including, without
limitation, the lease of office space or computer hardware or software by the
Seller to or from an Affiliate) (A) in the ordinary course of business, (B)
pursuant to the reasonable requirements of the Seller's business, and (C) upon
fair and reasonable terms that are no less favorable to the Seller than could be
obtained in a comparable arms-length transaction with a Person not an Affiliate
of the Seller. It is understood that any compensation arrangement for officers
shall be permitted under clause (ii)(A) through (C) above if such arrangement
has been expressly approved by the board of directors of the Seller.
(n) INDEBTEDNESS; INVESTMENTS. The Seller will not incur any
Indebtedness other than Indebtedness arising hereunder or under the other
Transaction Documents and (ii) Indebtedness owing to an Originator evidenced by
subordinated promissory notes in form and substance reasonably satisfactory to
the Purchaser . The Seller will not make any Investments other than Permitted
Investments.
(o) CHANGE IN THE SALE AND CONTRIBUTION AGREEMENT. The Seller will not
amend, modify, waive or terminate any terms or conditions of the Sale and
Contribution Agreement.
(p) AMENDMENT TO CERTIFICATE OF INCORPORATION. The Seller will not
amend, modify or otherwise make any change to its Certificate of Incorporation
to delete or otherwise nullify or circumvent the provisions set forth on EXHIBIT
F hereto.
(q) AUTHORIZED SIGNATORY. Any person signing a Request Notice on behalf
of Seller, as provided in EXHIBIT A hereto shall have the requisite power and
authority to sign the same on behalf of the Seller.
Section 6.2 RELEASE OF INTEREST IN INTERVAL.
At the same time as (i) any Receivable becomes a Prepaid Receivable and
in connection therewith the Interval related to such Prepaid Receivable is sold,
(ii) any Receivable matures, or (iii) the Seller through the Servicer,
substitutes or replaces any Receivable as contemplated in Section 2.11 hereof,
the Purchaser will release its interest in the Interval (whether Purchaser's
interest in such
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Interval is in the form of a lien through a Purchase Money Mortgage or an
interest in the Deed through the Deed Custodian) relating to such Prepaid
Receivable or such Replaced Interval, as the case may be; PROVIDED, that such
release will not constitute a release of the respective interests of Purchaser
and Seller in the proceeds of such sale. In connection with any of the events
described in the preceding sentence, the Purchaser will execute and deliver (at
the expense of the Seller) to the Servicer any assignments, bills of sale,
termination statements and any other releases and instruments as the Servicer
may reasonably request in order to effect such release and transfer, and the
Purchaser shall be deemed to have transferred to the Obligor all of the
Purchaser's right, title and interest in such Interval and shall be deemed to
have represented to the Obligor that the Purchaser has the authority to so
transfer, has completed all corporate action required by it to effect such
transfer and has transferred such interest free and clear of any interest
created by the Purchaser hereunder, but without any other recourse,
representation or warranty, express or implied. Nothing in this Section shall
diminish the Servicer's obligations pursuant to Sections 5.1, 5.5 and 5.6 of the
Servicing Agreement with respect to the proceeds of any such sale.
Section 6.3 RETRANSFER OF INELIGIBLE RECEIVABLES.
Upon discovery by the Servicer, Seller or Purchaser of a breach of a
representation or warranty of the Seller set forth in Section 5.2 with respect
to a Receivable in the Asset Pool which materially adversely affects the
Receivable or with respect to Receivables for which the breach of a
representation or warranty in the aggregate materially adversely affects the
Purchaser (an "INELIGIBLE RECEIVABLE"), the party discovering such breach shall
give prompt written notice to the other parties. Not later than the
Determination Date which is at most thirty (30) days after the earlier to occur
of the discovery of such breach by the Seller or receipt by the Seller of
written notice of such breach given by the Purchaser or the Servicer, the Seller
shall, at its option, either cure the breach within the above described time
period or repurchase and the Purchaser shall convey, free and clear of any Lien
created by pursuant to this Agreement, all of its right, title and interest in
such Ineligible Receivable, and the Purchaser shall, in connection with such
conveyance and without further action, be deemed to represent and warrant that
it has the corporate authority and has taken all necessary corporate action to
accomplish such conveyance, but without any other recourse, representation or
warranty, express or implied. In any of the foregoing instances, the Seller
shall accept a retransfer of each such Ineligible Receivable, and there shall be
deducted from the Receivable Balance of the Asset Pool, the Receivable Balance
of each such Ineligible Receivable. On and after the date of such retransfer,
each Ineligible Receivable so retransferred shall not be included in the Asset
Pool. In consideration of such retransfer the Seller shall, on the date of
retransfer of such Ineligible Receivable, make or cause to be made a deposit in
the Collection Account (for allocation pursuant to Section 2.6 or 2.7, as
applicable) in immediately available funds in an amount equal to the Transfer
Deposit Amount for such Ineligible Receivable. Upon each retransfer to the
Seller of such Ineligible Receivable in accordance herewith, the Purchaser shall
automatically and without further action be deemed to transfer, assign and
set-over to the Seller, free and clear of any Lien created pursuant to this
Agreement, all the right, title and interest of the Purchaser in, to and under
such Receivable and all monies due or to become due with respect thereto, the
related Interval and all proceeds of such Receivable, Recoveries and Insurance
Proceeds relating
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thereto, all rights to security for any such Receivable, the deed relating to
any such Receivable and all proceeds and products of the foregoing, and the
Purchaser shall, in connection with such transfer, assignment and set-over and
without further action, be deemed to represent and warrant that it has the
corporate authority and has taken all necessary corporate action to accomplish
such transfer, assignment and set-over, but without any other recourse,
representation or warranty, express or implied. The Purchaser shall, at the sole
expense of the Servicer, execute such documents and instruments of transfer as
may be prepared by the Servicer on behalf of the Seller and take such other
actions as shall reasonably be requested by the Seller to effect the transfer of
such Ineligible Receivable pursuant to this Section 6.3.
Notwithstanding the foregoing, in lieu of repurchasing an Ineligible
Receivable as described above the Seller may, subject to the conditions and
requirements of Section 2.11 of this Agreement, effect a replacement of such
Receivable with a Substitute Receivable, such replacement to be effected not
later than the date that a repurchase would have been required hereunder. Upon
any such substitution, the Ineligible Receivable (and Deed relating thereto)
will be retransferred to Seller as provided above.
The obligation of the Seller to repurchase and accept retransfer of any
Ineligible Receivable (or in the alternative, effect a valid replacement of such
Receivable as described above) shall constitute the sole remedy respecting any
breach of the representations and warranties set forth in Section 5.2 with
respect to such Receivable available to the Purchaser. Notwithstanding anything
to the contrary contained herein, in the event the Seller, prior to the
applicable Determination Date, remedies the condition which rendered the
Receivable an "INELIGIBLE RECEIVABLE" during the previously described 30 day
period, the Seller is not obligated to repurchase or replace such Receivable. It
is understood and agreed by the parties hereto that the payment obligations of
the Obligors' in respect of the Receivables purchased hereunder shall not be the
obligation of the Originator, the Seller or the Deed Custodian, except with
respect to Servicer Advances and remedies associated with breaches of
representations and warranties.
ARTICLE VII
[RESERVED]
ARTICLE VIII
EVENTS OF TERMINATION
Section 8.1 EVENTS OF TERMINATION.
If any of the following events ("EVENTS OF TERMINATION") shall occur:
(a) (i) failure on the part of Originator or the Seller
to make or cause to be made
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any payment or deposit (or in the alternative, Receivable
substitution) required by the terms of this Agreement or any
Transaction Document on the day such payment or deposit (or
substitution) is required to be made by Originator or the
Seller (giving effect to any applicable grace period) or (ii)
failure on the part of Originator or the Seller to observe or
perform any of its other covenants or agreements set forth in
this Agreement or any Transaction Document, which failure
continues unremedied for a period of 30 days after written
notice; PROVIDED, that only a 10 day cure period shall apply
in the case of a failure by Originator or the Seller to
observe its covenant not to grant a security interest or
otherwise intentionally create a Lien on the Receivables;
(b) any representation or warranty made by Originator or the
Seller in this Agreement or any Transaction Document or any
information required to be given by Originator or the Seller
to the Purchaser to identify the Receivables pursuant to this
Agreement or any Transaction Document, shall prove to have
been incorrect in any material respect when made or when
delivered, which continues to be incorrect in any material
respect for a period of 30 days after written notice;
provided, that this clause (b) shall not apply to any
representation and warranty which relates solely to the
condition of a Receivable on the date of Purchase and for
which either a substitution, repurchase or cure right under
Section 6.3 hereof applies and for which such remedies are
being pursued by the Seller and Originator consistent with
such Section;
(c) the occurrence of an Insolvency Event relating to Bluegreen,
the Seller, the Servicer or the Deed Custodian;
(d) the Seller shall become an "INVESTMENT COMPANY" within the
meaning of the Investment Company Act of 1940, as amended (the
"Act") or the arrangements contemplated by this Agreement
shall require registration as an "INVESTMENT COMPANY" within
the meaning of the Act;
(e) as of any Determination Date, the Lifetime Cumulative Default
Rate shall exceed the Lifetime Cumulative Default Threshold;
(f) as of any Determination Date, the Trailing Six Month Default
Rate exceeds 6.00%; provided, however, if such Determination
Date is after the Program Termination Date and the Asset Pool
aggregate Receivable Balance is less than 7.50% of the Capital
Payout, such test shall no longer be applicable.
(g) omitted;
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(h) as of any Determination Date, the Trailing Three Month (31 to
59) and (60 to 89) Day Delinquency Rates exceed 6.0% and 4.0%
respectively;
(i) as of any Determination Date, the Weighted Average Spread is
less than 5.50%;
(j) omitted;
(k) as of any Determination Date, the Trailing Three Month Gross
Recoveries are less than 85%;
(l) Bluegreen shall cease to own (whether directly or indirectly)
100% of the issued and outstanding stock of the Seller or the
Seller shall cease to own (whether directly or indirectly)
100% of the issued and outstanding stock of Deed Corp;
(m) a Servicer Termination Event shall occur under the Servicing
Agreement;
then, and in any such event, the Purchaser may, by written notice to the Seller,
declare the Termination Date to have occurred, except that, in the case of any
event described in Section 8.1(c) above, the Termination Date shall be deemed to
have occurred automatically upon the occurrence of such event. Upon any such
declaration or automatic occurrence of the Termination Date, the Purchaser shall
have, to the extent the transaction is recharacterized as a secured loan rather
than a sale of Receivables notwithstanding the parties intent to have the
transaction characterized as a sale of the Receivables and related Assets, in
addition to all other rights and remedies under this Agreement or otherwise, all
other rights and remedies provided under the UCC of the applicable jurisdiction
and other applicable laws, which rights shall be cumulative. Notwithstanding
anything to the contrary contained in this Section 8.1, the Events of
Termination described in clauses (e), (h), (i) and (k) may be cured and
Purchases may resume hereunder if such condition shall not exist for three (3)
consecutive Collection Periods after the date the Purchaser ceased making
Purchases hereunder; provided, however, the ability to cure the Event of
Termination in clause (k) shall only be applicable if the trigger level which
caused such Event of Termination was above 80%.
ARTICLE IX
Section 9.1 FURTHER ASSURANCES. The Purchaser, Originator and Seller
agree that from time to time the Purchaser will sell the Assets or cash flows
therein to various third parties. Originator and Seller agree to use their best
efforts to cooperate with the Purchaser in connection with the Purchaser's sale
of the Assets or the cash flows therein to such third parties; provided,
however, Originator and Seller are not obligated to pay any of the Purchaser's
fees or expenses associated with such sale. In the event Originator and Seller
incur out of pocket expenses associated with the sale of the Assets or the cash
flows therein to a third party (I.E., the creation of new software
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to service the Receivables and the related Assets or the cash flows therein,
change in servicing requirements, etc.) Purchaser shall reimburse the Originator
or Seller for such expense.
ARTICLE X
[RESERVED]
ARTICLE XI
ASSIGNMENTS; PARTICIPATIONS; RELEASE OF ASSETS
Section 11.1 ASSIGNMENTS.
(a) The Purchaser may at any time assign to one or more assignees, all,
or any ratable part of, its interest in the Asset Pool as in effect from time to
time hereunder, PROVIDED, (i) the Purchaser's obligations under this Agreement
and any other Transaction Document shall remain unchanged, (ii) the Purchaser
shall remain solely responsible for the performance of such obligations, and
(iii) the Seller, Originator, the Servicer and Deed Corp shall continue to deal
solely and directly with the Purchaser in connection with the rights and
obligations under this Agreement and the other Transaction Documents.
(b) In addition, the Purchaser may both assign and delegate to one or
more assignees, all, or any ratable part of, its interest in the Asset Pool as
in effect from time to time hereunder, its commitment to purchase Receivables
and related Assets, and the other rights and obligations of the Purchaser
hereunder and under the other Transaction Documents; PROVIDED, HOWEVER, the
Seller, Originator and the Servicer shall, at their election, have the right to
continue to deal solely and directly with the Purchaser in connection with the
rights and obligations under this Agreement and the other Transaction Documents;
and PROVIDED, FURTHER, that if any assignee fails to satisfy its obligations
hereunder, HFI shall perform such obligations. The Seller and Originator agree
to cooperate in good faith with the Purchaser in connection with effecting any
such assignments and delegations, including execution of any amendments or
supplements to this Agreement or any other Transaction Document which the
Purchaser reasonably deems necessary in order to effect such assignment and
delegation.
Section 11.2 PARTICIPATIONS.
The Purchaser may at any time sell to one or more commercial financial
institutions or other Persons not Affiliates of the Originator, participating
interests in its interest in the Asset Pool as in effect from time to time
hereunder, its commitment to purchase Receivables, and the other rights and
obligations of the Purchaser hereunder and under the other Transaction
Documents; PROVIDED, HOWEVER, that (i) the Purchaser's obligations under this
Agreement and any other Transaction
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Document shall remain unchanged, (ii) the Purchaser shall remain solely
responsible for the performance of such obligations, and (iii) the Seller,
Originator and Servicer shall continue to deal solely and directly with the
Purchaser in connection with the rights and obligations under this Agreement and
the other Transaction Documents.
Section 11.3 INFORMATION TO ASSIGNEES/PARTICIPANTS; CONFIDENTIALITY.
The Purchaser may furnish any information concerning the Seller,
Originator and Servicer in possession of the Purchaser from time to time to
assignees and participants (including prospective assignees and participants).
Purchaser agrees to take and to cause its Affiliates to take normal and
reasonable precautions and exercise due care to maintain the confidentiality of
all information identified as "CONFIDENTIAL" or "SECRET" by the Seller and
provided to it by the Seller, or by the Purchaser on the Seller's behalf, under
this Agreement or any other Transaction Document, and neither it nor any of its
Affiliates shall use any such information other than in connection with or in
enforcement of this Agreement and the other Transaction Documents or in
connection with other business now or hereafter existing or contemplated with
the Seller; except to the extent such information (i) was or becomes generally
available to the public other than as a result of disclosure by the Purchaser or
one of its Affiliates, or (ii) was or becomes available on a non-confidential
basis from a source other than the Seller, provided that such source is not
bound by a confidentiality agreement with the Seller known to the Purchaser;
PROVIDED, HOWEVER, that the Purchaser or any assignee (including any assignee
thereof) may disclose such information (A) at the request of, or pursuant to any
requirement of any Purchaser, or in connection with, an examination of such
Purchaser by any regulatory authority; (B) pursuant to subpoena or other court
process; (C) when required to do so in accordance with the provisions of any
applicable requirement of law; (D) to the extent reasonably required in
connection with any litigation or proceeding to which the Purchaser or any
Affiliates may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Transaction
Document; (F) to the Purchaser's independent auditors and other professional
advisors; (G) to any participant or Eligible Assignee, actual or potential,
provided that such Person agrees in writing to keep such information
confidential to the same extent required of the Purchaser hereunder; (H) as to
the Purchaser or its Affiliate, as expressly permitted under the terms of any
other document or agreement regarding confidentiality to which the Seller is
party or is deemed party with the Purchaser as its Affiliates; (I) to its
Affiliates; PROVIDED such Affiliate is bound by the confidentiality provisions;
(J) to any rating agency or regulatory body overseeing the Purchaser or any
assignee and (K) to any party providing liquidity or credit support to the
Purchaser or any assignee.
Section 11.4 SELLER'S REPURCHASE OPTION.
Following Seller's written notice to the Purchaser at least twenty (20)
days prior to a Payment Date, and provided that the Receivable Balance of all
Receivables in the Asset Pool is then less than 5.00% of the aggregate
Receivable Balances of the Receivables purchased hereunder when so purchased,
the Seller may (but is not required to) repurchase from the Purchaser on that
Payment Date all outstanding Receivables and related Assets at a price equal to
the Aggregate Unpaids. Such
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price is to be deposited in the Collection Account one Business Day before such
Payment Date, against the Purchaser's retransfer and release of the Receivables,
related Assets and the Receivable Files to the Seller.
ARTICLE XII
MISCELLANEOUS
Section 12.1 AMENDMENTS AND WAIVERS.
No amendment or modification of any provision of this Agreement shall
be effective without the written agreement of the Seller and the Purchaser or
any assignee and no termination or waiver of any provision of this Agreement or
consent to any departure therefrom by the Seller shall be effective without the
written concurrence of the Purchaser. Any waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
Section 12.2 NOTICES, ETC.
All notices, demands, certificates, requests and communications
hereunder ("NOTICES") shall be in writing and shall be effective (a) upon
receipt when sent through the U.S. mails, registered or certified mail, return
receipt requested, postage prepaid, with such receipt to be effective the date
of delivery indicated on the return receipt, or (b) one Business Day after
delivery to an overnight courier, or (c) on the date personally delivered to an
Authorized Officer of the party to which sent, or (d) on the date transmitted by
legible telefax transmission with a verbal confirmation of receipt (except that
notices and communications pursuant to Article II shall not be effective until
received with respect to any notice sent by mail or telex), in all cases
addressed to the recipient as follows:
If to the Originator/Servicer: Bluegreen Corporation
4960 Blue Lake Drive
Boca Raton, Florida 33431
Attn: Patrick E. Rondeau, Esq.
Telephone No.: (561) 912-8005
Telecopy: (561) 912-8100
If to the Seller: Bluegreen Receivables Finance
Corporation III
4960 Blue Lake Drive
Boca Raton, Florida 33431
Attn: Patrick E. Rondeau, Esq.
Telephone No.: (561) 912-8005
Telecopy: (561) 912-8100
If to Deed Corp: BRFC III Deed Corporation
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4960 Blue Lake Drive
Boca Raton, Florida 33431
Attn: Patrick E. Rondeau, Esq.
Telephone No.: (561) 912-8005
Telecopy: (561) 912-8100
If to Purchaser: Heller Financial, Inc.
28th Floor - Heller Sales Finance
500 W. Monroe Street
Chicago, Illinois 60661
Attn: Portfolio Manager,
Vacation Ownership
Facsimile: (312) 441-7924
with a copy to: Heller Financial, Inc.
28th Floor - Heller Sales Finance
500 W. Monroe Street
Chicago, Illinois 60661
Attn: Group General Counsel -
Vacation Ownership
Facsimile: (312) 441-7872
If to the Cash Administrator: U.S. Bank National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Sheryl Christopherson
Fax No.: (612) 244-1797
Tel. No.: (612) 244-0739
Each party hereto may, by notice given in accordance herewith to each of the
other parties hereto, designate any further or different address to which
subsequent notices shall be sent.
Section 12.3 [RESERVED]
Section 12.4 NO WAIVER; REMEDIES.
No failure on the part of the Purchaser to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 12.5 BINDING EFFECT.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their
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respective successors and permitted assigns.
Section 12.6 TERM OF THIS AGREEMENT.
This Agreement, including, without limitation, the Seller's obligation
to observe its covenants set forth in Article VI, shall remain in full force and
effect until there are no Aggregate Unpaids; PROVIDED, HOWEVER, that the
provisions of Section 12.9 and Section 12.10 shall be continuing and shall
survive any termination of this Agreement.
Section 12.7 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF
OBJECTION TO VENUE.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF ILLINOIS. EACH OF THE PURCHASER, THE SELLER AND THE
SERVICER HEREBY AGREES TO THE NONEXCLUSIVE JURISDICTION OF ANY FEDERAL COURT
LOCATED WITHIN THE STATE OF ILLINOIS. EACH OF THE PARTIES HERETO HEREBY WAIVES
ANY OBJECTION BASED ON FORUM NON CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY
ACTION INSTITUTED HEREUNDER IN ANY OF THE AFOREMENTIONED COURTS AND CONSENTS TO
THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT.
Section 12.8 WAIVER OF JURY TRIAL.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PURCHASER, THE
SELLER AND THE SERVICER WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING
ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE
PARTIES HERETO ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP BETWEEN ANY OF THEM IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. INSTEAD, ANY SUCH DISPUTE RESOLVED IN COURT
WILL BE RESOLVED IN A BENCH TRIAL WITHOUT A JURY.
Section 12.9 COSTS, EXPENSES AND TAXES.
(a) The Originator and the Seller agree to pay or cause to be paid on
demand all costs and expenses of the Purchaser incurred in connection with the
preparation, execution, delivery, administration (including periodic auditing),
amendment or modification of, or any waiver or consent issued in connection
with, this Agreement and the other documents to be delivered hereunder or in
connection herewith, including, without limitation, the reasonable fees and
out-of-pocket expenses of counsel for the Purchaser with respect thereto and
with respect to advising the Purchaser as to its respective rights and remedies
under this Agreement and the other documents to be delivered hereunder or in
connection herewith, and all costs and out-of-pocket expenses, if any
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<PAGE> 38
(including reasonable counsel fees and expenses), incurred by the Purchaser in
connection with the enforcement of this Agreement and the other documents to be
delivered hereunder or in connection herewith; PROVIDED, HOWEVER, Originators
and Sellers obligations under this Section 12.9(a) hereof shall not extend to
costs and expenses associated with the exercise of the Purchaser's rights under
Sections 11.1 and 11.2 hereof.
(b) The Originator and the Seller shall pay or cause to be paid on
demand any and all damages, losses, claims, liabilities, fees and related costs
and expenses, including attorney's fees and expenses, incurred by or awarded
against the Purchaser or any of its respective Affiliates (each, an "INDEMNIFIED
PARTY") arising out of or as a result of any acts, omissions or alleged acts or
omissions of the Originator or Seller in violation or in contravention of this
Agreement or other Transaction Documents and owed by such Indemnified Party to
any other Person; PROVIDED that the Seller shall not be liable for the payment
of any portion of such damages, losses, claims, liabilities, fees or related
costs or expenses resulting from the gross negligence or willful misconduct of
an Indemnified Party or the breach of a Requirement of Law by an Indemnified
Party; PROVIDED, HOWEVER, that nothing contained in this paragraph shall be
construed to obligate the Originator or the Seller to indemnify an Indemnified
Party with respect to losses, claims, damages and liabilities incurred as a
result of the payment performance of the Receivables and related Assets.
Section 12.10 NO BANKRUPTCY COVENANT.
The parties hereto (other than the Purchaser) hereby covenant and agree
that they will not institute against, or join any other Person in instituting
against, the Seller or Deed Corp any involuntary Insolvency Proceedings or take
any action in contemplation or furtherance thereof.
Section 12.11 PROTECTION OF OWNERSHIP INTERESTS OF THE PURCHASER;
INTENT OF PARTIES; BACK-UP SECURITY INTEREST.
(a) The Seller agrees that from time to time, at its expense, it will
or will cause the Servicer to promptly execute and deliver all instruments and
documents, and take all actions, that may reasonably be necessary or desirable,
or that the Purchaser may reasonably request, to perfect, protect or more fully
evidence its ownership of and interest in the Assets, or to enable the Purchaser
to exercise and enforce its rights and remedies hereunder.
(b) If the Seller or the Servicer fails to perform any of its
obligations hereunder after ten (10) days' notice from the Purchaser, the
Purchaser may (but shall not be required to) perform, or cause performance of,
such obligation; and the Purchaser's costs and expenses incurred in connection
therewith shall be payable by the Seller (if the Servicer that fails to so
perform is the Seller or an Affiliate thereof) as provided in Section 12.9, as
applicable. The Seller irrevocably authorizes the Purchaser and appoints the
Purchaser as its attorney-in-fact to act on behalf of the Seller (i) to execute
on behalf of the Seller as debtor and to file financing statements necessary or
desirable in the Purchaser's sole discretion to perfect and to maintain the
perfection and priority of the interest of the Purchaser in the Assets and (ii)
to file a carbon, photographic or other reproduction of this
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<PAGE> 39
Agreement or any financing statement with respect to the Assets as a financing
statement in such offices as the Purchaser in its sole discretion deems
necessary or desirable to perfect and to maintain the perfection and priority of
the interests of the Purchaser in the Assets.
(c) The parties hereto intend that the conveyance of Assets by the
Seller to the Purchaser shall be treated as sales for all purposes. If, despite
such intention, a determination is made that such transactions shall not be
treated as sales, then this Agreement shall be interpreted to constitute a
security agreement and the transactions effected hereby shall be deemed to
constitute secured loans by the Purchaser to the Seller under applicable law,
with recourse of the Purchaser being limited to the Assets, and as otherwise
expressly contemplated by the provisions of the Transaction Documents. For such
purpose, the Seller hereby transfers, conveys, assigns and grants to the
Purchaser, a continuing security interest in all Assets, all Collections and the
proceeds of the foregoing to secure the repayment of all Capital, all payments
at any time due or accrued in respect of the Yield and all other payments at any
time due (whether accrued or due) by the Seller hereunder (including without
limit any fee owing to the Purchaser or amount owing under Section 12.9 hereof).
Section 12.12 EXECUTION IN COUNTERPARTS; SEVERABILITY; INTEGRATION.
This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute one and the same agreement. In case any provision in or
obligation under this Agreement shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby. This
Agreement contains the final and complete integration of all prior expressions
by the parties hereto with respect to the subject matter hereof and shall
constitute the entire agreement among the parties hereto with respect to the
subject matter hereof, superseding all prior oral or written understandings.
Section 12.13 PURCHASER RIGHT OF FIRST REFUSAL.
Originator and Seller hereby covenant with Purchaser that, from the
date hereof until the first to occur of (a) the Maturity Date, (b) the date on
which an event occurs which relieves the Purchaser from making Purchases
hereunder and the Purchaser is not making Purchases hereunder, (c) the date on
which an event occurs which relieves Heller Financial, Inc. from making Advances
under the Warehouse Facility and Heller Financial, Inc. is not making Advances
thereunder, or (d) an Event of Termination under Section 8.1 of this Agreement,
Purchaser shall have, and Purchaser is hereby granted, the right and option,
subject to the terms set forth below (the "PURCHASE OPTION") to purchase
Receivables and related Assets (which for this purpose shall obligate the
Originator and Seller, as well as any Affiliate thereof, to disclose to
Purchaser all resorts developed by the Originator and Seller or any Affiliate
thereof in order to provide Purchaser the opportunity to make a determination
whether such resort may be an Additional Resort). Purchaser shall notify the
Originator and Seller within forty-five days of its receipt of satisfactory
information with respect to
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<PAGE> 40
a resort whether such resort qualifies as an Additional Resort.
The Purchase Option may be exercised or not exercised in Purchaser's
sole discretion. If Purchaser declines to exercise the Purchase Option,
Purchaser shall have no further Purchase Option with respect to the Receivables.
Notwithstanding anything contained herein to the contrary, it is expressly
agreed and understood that any purchase pursuant to the Purchase Option shall be
subject to approval by Purchaser's credit committee in accordance with
Purchaser's standard credit guidelines and it is further expressly understood
and agreed that Purchaser is under no obligation to exercise the Purchase Option
and that nothing in this Section 12.13 shall be deemed or construed to create
any such obligation.
Section 12.14 PURCHASE CESSATION EVENTS.
In the event Heller Financial, Inc. is no longer making Advances under
the Warehouse Facility or an Increased Cost Event shall have occurred and is
continuing, Collections shall be applied consistent with Section 2.6 hereof.
Section 12.15 COOPERATION OF PARTIES TO CLUB CONVERSION.
The parties hereto agree that they will cooperate to effectuate the
conversion of the Receivables relating to the Resorts, which are in the form of
conditional sales contracts, into notes and related mortgages in order to
convert the Obligors of such Receivables into the Club as well as preserving the
Purchaser's economic and ownership interest in the Receivables purchased
hereunder.
35
<PAGE> 41
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
THE SELLER: BLUEGREEN RECEIVABLES FINANCE
CORPORATION III
By: _____________________________________
Printed Name: ___________________________
Title: __________________________________
THE CUSTODIAN OF BRFC III DEED CORPORATION
CERTAIN DEEDS:
By: _____________________________________
Printed Name: ___________________________
Title: __________________________________
36
<PAGE> 42
THE ORIGINATOR/SERVICER: BLUEGREEN CORPORATION
By: _____________________________________
Printed Name: ___________________________
Title: __________________________________
THE PURCHASER: HELLER FINANCIAL, INC.
By: _____________________________________
Printed Name: ___________________________
Title: __________________________________
THE CASH ADMINISTRATOR: U.S. BANK NATIONAL ASSOCIATION
By: _____________________________________
Printed Name: ___________________________
Title: __________________________________
<PAGE> 43
SCHEDULE I
CONDITION PRECEDENT DOCUMENTS
As required by Section 4.1 of the Agreement, each of the following
items must be delivered to the Purchaser prior to the date of the Initial
Purchase:
This Agreement, and each other Transaction Document, duly executed by
the parties thereto;
Certificates of the Secretary or Assistant Secretary of each of the
Seller and the Originator, each dated the date of this Agreement, certifying (i)
the names and true signatures of the incumbent officers of such Person
authorized to sign this Agreement and/or the other Transaction Documents to be
delivered by it (on which certificate the Purchaser may conclusively rely until
such time as the Purchaser shall receive from the Seller or the Originator, as
the case may be, a revised certificate meeting the requirements of this
paragraph), (ii) that the copy of the certificate of incorporation of such
Person attached thereto is a complete and correct copy and that such certificate
of incorporation has not been amended, modified or supplemented and is in full
force and effect, (iii) that the copy of the bylaws of such Person attached
thereto is a complete and correct copy and that such by-laws have not been
amended, modified or supplemented and are in full force and effect, and (iv) the
resolutions of such Person's board of directors approving and authorizing the
execution, delivery and performance by such Person of this Agreement and the
documents related thereto;
Good standing certificates for the Seller and the Originator issued by
the Secretaries of State of Delaware, with respect to the Seller, and
Massachusetts, Florida, Missouri, Tennessee and South Carolina, with respect to
the Originator.
Acknowledgment copies of proper financing statements (the "FACILITY
FINANCING STATEMENTs"), dated a date reasonably near to the date of the Initial
Purchase, describing the Assets and (a) with respect to the conveyances from the
Originator to the Seller, naming the Originator as debtor and the Seller as
secured party and the Purchaser as assignee and (b) with respect to the
conveyances from the Seller to the Purchaser, naming the Seller as debtor and
the Purchaser as secured party, together with such other, similar instruments or
documents, as may be necessary or, in the opinion of the Purchaser, desirable
under the UCC of all appropriate jurisdictions or any comparable law to perfect
the Purchaser's interests in all Assets;
Acknowledgment copies of proper financing statements, if any, necessary
to release all security interests and other rights of any Person in the Assets
previously granted by the Originator;
Certified copies of requests for information or copies (or a similar
search report certified by a party acceptable to the Purchaser), dated a date
reasonably near to the date of the Initial Purchase, listing all effective
financing statements which name the Originator or Seller (under its present name
and any previous name) as debtor and which are filed in the jurisdictions in
which the financing
<PAGE> 44
statements referred to above were filed, together with copies of such financing
statements (none of which, other than the financing statements in favor of the
Purchaser or being properly released as referred to above, shall cover any
Assets or Receivables); and
An opinion of Choate, Hall & Stewart, counsel to the Originator and
Seller regarding enforceability, security interest perfection and similar
issues, in substantially the form of EXHIBIT E, and as to such other matters as
the Purchaser may reasonably request.
An Asset Report prepared by the Servicer in form and substance
satisfactory to the Purchaser.
A List of Receivables for the Initial Purchase.
The items described on the Purchase Facility Resort Checklist attached
hereto as Exhibit I-1.
An opinion of Choate, Hall & Stewart, counsel to the Originator and
Seller, regarding "TRUE SALE" and non-consolidation issues, in form and
substance reasonably satisfactory to the Purchaser and its counsel.
Executed UCC-3 terminations or partial releases, as and to the extent
necessary or, in Purchaser's reasonable judgment, desirable to effect a
conveyance "FREE AND CLEAR" of Liens.
Delivery into custody of the Purchaser of the Originals for the
Receivables being purchased at the Initial Purchase.
Such other documents, instruments, reports and opinions as the
Purchaser may reasonably request.
With respect to an Incremental Purchase or Subsequent Receivable
relating to an Additional Resort, the items described in the Purchase Facility
Additional Resort checklist attached hereto as Exhibit I-2.
With respect to Club the items on the Club Closing Checklist.
<PAGE> 45
SCHEDULE II
CREDIT AND COLLECTION POLICY
[to be attached]
<PAGE> 46
SCHEDULE III
TRADENAMES, FICTITIOUS NAMES AND "DOING BUSINESS AS" NAMES
Bluegreen Corporation
Bluegreen Resorts, Inc.
Patten Corporation
Patten Resorts, Inc.
Mountain Loft Resort
Laurel Crest Resort
Shore Crest Resort
Harbour Lights Resort
Falls Village Resort
<PAGE> 47
SCHEDULE IV
[RESERVED]
<PAGE> 48
SCHEDULE V
LOCATION OF RECEIVABLE FILES
<PAGE> 49
SCHEDULE VI
INSURANCE
<PAGE> 50
EXHIBIT A
[FORM OF]
REQUEST NOTICE
I, ______________________, _______________ of Bluegreen Receivables
Finance Corporation III (the "SELLER"), hereby certify that, with respect to
that certain Asset Purchase Agreement among the Seller, Bluegreen Corporation,
Heller Financial, Inc., BRFC III Deed Corporation and [_______] (the "ASSET
PURCHASE AGREEMENT"; all defined terms referenced in the Asset Purchase
Agreement to have the same meaning herein):
The Seller hereby requests that an [Initial Purchase] [Incremental
Purchase] be made in accordance with the following terms:
(a) The aggregate Cash Purchase Price of such Purchase shall be
_________________.
(b) The Purchase Date shall be __________________.
(c) The Cutoff Date shall be __________________.
The representations and warranties contained in Sections 5.1 and 5.2 of
the Asset Purchase Agreement are true and correct as though made on the date
hereof. The Seller has delivered or caused to be delivered to the Purchaser,
prior to or substantially contemporaneously with the delivery of this Request
Notice, an updated List of Receivables, separately identifying thereon the
Receivables in the Asset Pool Portion requested to be Purchased by virtue of
this Request Notice, as well as an Asset Report with respect to such
Receivables.
No event has occurred and is continuing, or would result from any
Purchase occurring on the date hereof, which constitutes an Event of
Termination.
Prior to giving effect to the Purchase:
(A) aggregate Capital outstanding is $_______;
(B) the aggregate Capital Payout is $________; and
(C) the Capital Limit is $________ (consisting of the product of
(i) $______, representing the Receivable Balance of all
Eligible Receivables in the Asset Pool, multiplied by (ii)
_____, representing the applicable Credit Enhancement Factor).
After giving effect to the Purchase:
(A) aggregate Capital outstanding will be $_______;
<PAGE> 51
(B) the aggregate Capital Payout will be $________;
(C) the Capital Limit will be $________ (consisting of the product
of (i) $______, representing the Receivable Balance of all
Eligible Contracts in the Asset Pool, multiplied by (ii)
________, representing the applicable Credit Enhancement
Factor);
(D) aggregate Capital outstanding will not exceed the Capital
Limit; and
(E) aggregate Capital Payout will not exceed the Purchase Limit.
The Cash Purchase Price for the Purchase should be delivered by wire
transfer to [INSERT APPROPRIATE IDENTIFYING ACCOUNT AND REFERENCE NUMBER
INFORMATION].
On and as of such day, the Seller and the Servicer has each performed
in all material respects all of their agreements and obligations contained in
the Transaction Documents to be performed by such Person at or prior to such
day.
No law, rule or regulation prohibits, and no order, judgment or decree
of any federal, state or local court or governmental body, agency or
instrumentality prohibits or enjoins, the making of any Purchase to occur on the
Purchase Date specified above.
<PAGE> 52
This is the _____ day of ______________, 1998.
BLUEGREEN RECEIVABLES FINANCE
CORPORATION III
By: _____________________________________
Printed Name: _______________________
Title: ______________________________
<PAGE> 53
EXHIBIT B
LIST OF DELIVERIES FOR ALL PURCHASES
Pursuant to Section 2.2 of the Agreement, Purchaser shall not be
obligated to make any purchase unless Purchaser and Custodian shall have
received, in form and substance satisfactory to Purchaser, all documents,
instruments and information as follows:
To Purchaser at least five (5) Business Days prior to the
requested Purchase Date or at least ten (10) Business Days
prior to the requested Purchase Date in the event the
Receivables and related Assets are financed through a source
other than the Warehouse Facility.
1. A Request for Advance (in the form of EXHIBIT A to the Agreement)
listing all Receivables and related Assets to be purchased.
2. A computer diskette or magnetic tape prepared in accordance and in
the form provided by EXHIBIT 1 attached hereto which shall include, but not be
limited to, the aging report and Credit Code relating to the Receivables and the
related Assets to be purchased in connection with the requested purchase.
3. UCC-1 financing statements, executed by the Originator in favor of
Seller and Seller in favor of Purchaser relating to and describing Purchaser's
security interest in the contract rights evidenced by the conditional sales
contract.
4. Such additional information as Purchaser may reasonably require.
5. Report from Deed Corp/Title Report/Assignment (the form of
Assignment attached hereto as EXHIBIT H to the Agreement (with only such
modifications to such form as are necessary to properly identify the collateral
and to cause the document to be properly recorded)).
To Custodian at least five (5) Business Days prior to the
requested Purchase Date or at least ten (10) Business Days
prior to the requested Purchase Date in the event the
Receivables and related Assets are financed through a source
other than the Warehouse Facility:
1. The Pledged Receivables Schedule (in the form of EXHIBIT A to the
Custodial Agreement) listing all Receivables and related Assets to be purchased.
<PAGE> 54
2. Originals of all Receivables and the related Assets, and the form of
Assignment attached hereto as EXHIBIT H to the Agreement (with only such
modifications to such form as are necessary to properly identify the collateral
and to cause the document to be properly recorded), covering all of the
Receivables and related Assets to be sold in relation with such purchase except
that copies of the recordable Purchase Money Mortgages and Assignments, to
extent applicable, shall be satisfactory provided that recorded originals are
delivered to the Custodian within sixty (60) days after the purchase date or as
soon as practicable after received), all in forms approved by Purchaser, with
each Receivable endorsed with (i) an allonge in the form attached hereto as
EXHIBIT E in respect of Receivables evidenced by notes and mortgages, (ii) an
assignment in the form of EXHIBIT B in respect of Receivables evidenced by
conditional sales contracts, or (iii) other appropriate form acceptable to
Purchaser.
All documents to be delivered to Purchaser should be sent to:
[Carol Gilday
Portfolio Administrator, Vacation Ownership
Heller Financial, Inc.
500 West Monroe, Suite 2800
Chicago, Illinois 60661
Tel: (312) 441-7880
Fax: (312) 441-7924]
All documents to be delivered to the Custodian should be sent to:
[Mark Hammer]
[Norwest Bank.]
[1015 10th Avenue S.E.]
[Minneapolis, MN 55414]
[Mail Station 0031]
[Tel: ( ) ]
[Fax: ( ) ]
<PAGE> 55
EXHIBIT C
<PAGE> 56
EXHIBIT D
<PAGE> 57
EXHIBIT E
<PAGE> 58
EXHIBIT F
<PAGE> 59
EXHIBIT G
<PAGE> 60
EXHIBIT H
FORM OF SALE ASSIGNMENT
In accordance with the Asset Purchase Agreement (the "AGREEMENT") dated
as of June 26, 1998 made by and between the undersigned, as seller thereunder
("SELLER") and Heller Financial, Inc., as purchaser thereunder ("PURCHASER"),
the undersigned does hereby sell, transfer, assign, set over and otherwise
absolutely convey to Funding all its right, title and interest in and to:
(i) the Receivables (including Subsequent Receivables) conveyed or
being conveyed to the Purchaser pursuant to the Asset Purchase
Agreement, and all Collections thereon and monies due or to
become due in payment of such Receivables;
(ii) the Interval related to such Receivables, including all net
proceeds from any sale or other disposition of such Interval
after a default on the Receivables (I.E. after the payment of
Remarketing Fees);
(iii) the Receivables Files;
(iv) all payments made or to be made in the future with respect to
such Receivables or the Obligor thereunder under any guarantee
or similar credit enhancement with respect to such
Receivables;
(v) all Insurance Proceeds with respect to any such Receivables,
if applicable;
(vi) all rights of the Seller under the Sale and Contribution
Agreement including but not limited to all rights with respect
to the Receivables, including, without limitation, in respect
of the obligation of the Originator to repurchase or replace
Receivables under certain circumstances as specified therein;
(vii) the Trust Accounts and all Trust Account Property;
(viii) each Assignment; and
(ix) all income from and proceeds of the foregoing.
This Assignment is made pursuant to and in reliance upon the
representation and warranties on the part of the undersigned specified in
Article V of the Agreement and no others. Capitalized terms used in this
Assignment and not defined shall have the same meanings as such terms would have
if used in the Agreement.
<PAGE> 61
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed this 26th day of June, 1998.
BLUEGREEN RECEIVABLES FINANCE
CORPORATION III
By: ____________________________________
Printed Name:_______________________
Title:______________________________
Accepted:
HELLER FINANCIAL, INC.
By: ____________________________________
Printed Name:_______________________
Title:______________________________
<PAGE> 62
EXHIBIT I
DOCUMENT NUMBER:
