Purchase and Sale Agreement (2001)Full Document 

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                          PURCHASE AND SALE AGREEMENT


                          Dated as of December 22, 2000


                                     between



                               AFC AIM CORPORATION



                                       and



                         AUTOMOTIVE FINANCE CORPORATION






                                TABLE OF CONTENTS

                                                                            PAGE

                                    ARTICLE I

                      AGREEMENT TO PURCHASE AND CONTRIBUTE

1.1.  Agreement to Purchase and Sell...........................................2
1.2.  Timing of Purchases......................................................3
1.3.  Consideration for Purchases..............................................3
1.4.  Purchase and Sale Termination Date.......................................3
1.5.  Intention of the Parties.................................................3
1.6.  Certain Definitions......................................................4

                                   ARTICLE II

                          CALCULATION OF PURCHASE PRICE

2.1.  Calculation of Purchase Price............................................5

                                   ARTICLE III

                          CONTRIBUTION OF RECEIVABLES;
                            PAYMENT OF PURCHASE PRICE

3.1.  Contribution of Receivables..............................................7
3.2.  Initial Purchase Price Payment...........................................7
3.3.  Subsequent Purchase Price Payments.......................................7
3.4.  Settlement as to Specific Receivables....................................8
3.5.  Reconveyance of Receivables..............................................9

                                   ARTICLE IV

                             CONDITIONS OF PURCHASES

4.1.  Conditions Precedent to Initial Purchase.................................9
4.2.  Certification as to Representations and Warranties......................11

                                    ARTICLE V

                REPRESENTATIONS AND WARRANTIES OF THE ORIGINATOR

5.1.  Organization and Good Standing..........................................11

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                               TABLE OF CONTENTS
                                  (continued)
                                                                            PAGE

5.2.  Due Qualification.......................................................11
5.3.  Power and Authority; Due Authorization..................................12
5.4.  Valid Sale or Contribution; Binding Obligations.........................12
5.5.  No Violation............................................................12
5.6.  Proceedings.............................................................12
5.7.  Bulk Sales Act..........................................................13
5.8.  Government Approvals....................................................13
5.9.  Financial Condition.....................................................13
5.10.  Margin Regulations.....................................................13
5.11.  Quality of Title.......................................................13
5.12.  Accuracy of Information................................................14
5.13.  Offices................................................................14
5.14.  Trade Names............................................................14
5.15.  Taxes..................................................................15
5.16.  Licenses and Labor Controversies.......................................15
5.17.  Compliance with Applicable Laws........................................15
5.18.  Reliance on Separate Legal Identity....................................15
5.19.  Purchase Price.........................................................15
5.20.  Eligibility of Receivables.............................................15

                                   ARTICLE VI

                           COVENANTS OF THE ORIGINATOR

6.1.  Affirmative Covenants...................................................16
6.2.  Reporting Requirements..................................................18
6.3.  Negative Covenants......................................................19

                                   ARTICLE VII

                      ADDITIONAL RIGHTS AND OBLIGATIONS IN
                           RESPECT OF THE RECEIVABLES

7.1.  Rights of the Company...................................................20
7.2.  Responsibilities of the Originator......................................20
7.3.  Further Action Evidencing Purchases.....................................21
7.4.  Application of Collections..............................................22

                                  ARTICLE VIII

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                               TABLE OF CONTENTS
                                  (continued)

                                                                            PAGE

                      PURCHASE AND SALE TERMINATION EVENTS

8.1.  Purchase and Sale Termination Events....................................22
8.2.  Remedies................................................................23

                                   ARTICLE IX

                                 INDEMNIFICATION

9.1.  Indemnities by the Originator...........................................24

                                    ARTICLE X

                                  MISCELLANEOUS

10.1.  Amendments, etc........................................................27
10.2.  Notices, etc...........................................................27
10.3.  No Waiver; Cumulative Remedies.........................................27
10.4.  Binding Effect; Assignability..........................................27
10.5.  Governing Law..........................................................28
10.6.  Costs, Expenses and Taxes..............................................28
10.7.  Submission to Jurisdiction.............................................29
10.8.  Waiver of Jury Trial...................................................29
10.9.  Captions and Cross References; Incorporation by Reference..............29
10.10.  Execution in Counterparts.............................................29
10.11.  Acknowledgment and Agreement..........................................30




                                    SCHEDULES

SCHEDULE 5.13  Office Locations

SCHEDULE 5.14  Trade Names

SCHEDULE 5.15  Tax Matters


                                    EXHIBITS

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                                  (continued)


                                                                            PAGE


EXHIBIT A      Form of Company Note

                                      -iv-








                           PURCHASE AND SALE AGREEMENT


         THIS PURCHASE AND SALE AGREEMENT (as amended,  supplemented or modified
from time to time, this "AGREEMENT"),  dated as of December 22, 2000, is between
AUTOMOTIVE FINANCE CORPORATION, an Indiana corporation, as originator and seller
(the  "ORIGINATOR"),  and AFC  AIM  CORPORATION,  an  Indiana  corporation  (the
"COMPANY"), as purchaser.


                                   DEFINITIONS

         Unless otherwise indicated, certain terms that are capitalized and used
throughout  this  Agreement  are defined in EXHIBIT I to the Loan and  Servicing
Agreement of even date herewith (as amended,  supplemented or otherwise modified
from time to time, the "LOAN AND SERVICING  AGREEMENT"),  among the Company, the
Originator, as initial Servicer, and BANK OF MONTREAL, CHICAGO BRANCH, as lender
(together with its successors and assigns, the "LENDER").


                                   BACKGROUND

         1.    The Company is a special  purpose corporation, all of the capital
stock of which is wholly-owned by the Originator.

         2.    On the Closing Date, the Originator is transferring a portion of
the  Receivables  and Related  Rights in  existence  on the Closing  Date to the
Company as a capital contribution to the Company.

         3.    In order to finance  its business, the Originator  wishes to sell
certain Receivables and Related Rights from time to time to the Company, and the
Company is willing, on the terms and subject to the conditions set forth herein,
to purchase such Receivables and Related Rights from the Originator.

         4.    The Company  intends to finance its  purchase of the  Receivables
and Related Rights through secured loans to be made to the Company by the Lender
pursuant to the Loan and Servicing Agreement.




         NOW,  THEREFORE,  in  consideration  of the  premises  and  the  mutual
agreements herein contained, the parties hereto agree as follows:


                                    ARTICLE I

                      AGREEMENT TO PURCHASE AND CONTRIBUTE

         1.1.  AGREEMENT TO PURCHASE  AND SELL.  On the terms and subject to the
conditions  set  forth  in  this  Agreement   (including  ARTICLE  IV),  and  in
consideration  of the  Purchase  Price,  the  Originator  agrees  to sell to the
Company, and does hereby sell to the Company, and the Company agrees to purchase
from the  Originator,  and does hereby  purchase  from the  Originator,  without
recourse and without regard to  collectibility,  all of the Originator's  right,
title and interest in and to:

         (a)      each Receivable of the  Originator that existed and  was owing
to the Originator as of the opening of the Originator's business on December 22,
2000 (the "CLOSING DATE") (other than the portion of the Receivables and Related
Rights contributed by the Originator to the Company pursuant to SECTION 3.1 (the
"CONTRIBUTED PORTION"));

         (b)      each  Receivable created or originated  by the Originator from
the opening of the  Originator's  business on the Closing Date to and  including
the Purchase and Sale Termination Date;

         (c)      all of the Originator's right, title and interest under the
Isuzu Loan Documents;

         (d)      all of the Originator's  right,  title and interest in all
payments of  principal,  interest,  administrative  fees or other amounts due in
respect  of any  Advance or other  disbursement  under the  Promissory  Note and
Security Agreement.

         (e)      all rights to, but not the  obligations  under,  all Related
Security (other than with respect to the Contributed Portion);

         (f)      all monies due or to become due with respect to any of the
foregoing;

         (g)      all books and records related to any of the foregoing; and

         (h)      all  proceeds  thereof (as defined in the UCC)  including,
without limitation,  all funds which either are received by the Originator,  the
Company  or the  Servicer  from or on behalf of the  Obligor  in  payment of any
amounts owed (including,  without limitation,  finance charges, interest and all
other  charges)  in  respect  of any  Receivable  (other  than  the  Contributed
Portion),  or that are (or are to be) applied to amounts  owed in respect of any
such  Receivable  (including,  without  limitation,  insurance  payments and net
proceeds of the sale or other  disposition  of vehicles or other  collateral  or
property of the Obligor or any other Person  directly or  indirectly  liable for
the payment of any such Receivable that are (or are to be) applied thereto).

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All purchases and contributions  hereunder shall be made without  recourse,  but
shall be made pursuant to and in reliance upon the  representations,  warranties
and covenants of the Originator,  in its capacity as Originator and contributor,
set forth in each Transaction  Document.  The Company's foregoing  commitment to
purchase such  Receivables and the proceeds and rights  described in SUBSECTIONS
(c) through (h) of this SECTION 1.1 (collectively,  including such item relating
to  Contributed  Portion,  the "RELATED  RIGHTS") is herein called the "PURCHASE
FACILITY."

         1.2.  TIMING OF PURCHASES.

         (a)      CLOSING DATE PURCHASES.  The Originator's entire right, title
and interest in (i) each Receivable that existed and was owing to the Originator
as of the opening of the Originator's  business on the Closing Date, (other than
Contributed  Portion) and (ii) all Related Rights with respect  thereto shall be
sold to the Company on the Closing Date.

         (b)      REGULAR PURCHASES.  After the Closing Date, each Receivable
created  or  originated  by the  Originator  and all  Related  Rights  shall  be
purchased  and  owned by the  Company  (without  any  further  action)  upon the
creation or origination of such Receivable.

         1.3.  CONSIDERATION FOR  PURCHASES.  On the terms and subject to the
conditions set forth in this Agreement,  the Company agrees to make all Purchase
Price payments to the Originator.

         1.4.  PURCHASE AND SALE TERMINATION  DATE.  The  "PURCHASE  AND SALE
TERMINATION  DATE"  shall  be the  earlier  to  occur  of (a)  the  date  of the
termination of this  Agreement  pursuant to SECTION 8.2 and (b) the Business Day
immediately following the day on which the Originator shall have given notice to
the Company that the Originator desires to terminate this Agreement.

         1.5.  INTENTION OF THE PARTIES. It is the express intent of the parties
hereto that the transfers of the Receivables  (other than  Contributed  Portion)
and Related Rights (other than those relating to the Contributed Portion) by the
Originator to the Company,  as contemplated by this Agreement be, and be treated
as,  sales and not as secured  loans  secured  by the  Receivables  and  Related
Rights.  If,  however,   notwithstanding   the  intent  of  the  parties,   such
transactions are deemed to be loans, the Originator hereby grants to the Company
a first priority security interest in all of the Originator's  right,  title and
interest  in and to each of the items  described  in clauses  (a) through (h) of
SECTION 1.1 above to secure all of the Originator's obligations hereunder.

         1.6.     CERTAIN  DEFINITIONS.  As used in this Agreement,  the terms
"Material Adverse Effect" and "Solvent" are defined as follows:

                  "MATERIAL  ADVERSE EFFECT" means, with respect to any event or
circumstance, a material adverse effect on:

                  (i)   the business, operations, property or financial
condition of the Originator;

                  (ii)  the ability of the Originator or the Servicer (if it is
the  Originator)  to  perform  its

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obligations  under the Loan and  Servicing  Agreement  or any other  Transaction
Document to which it is a party or the performance of any such obligations;

                  (iii) the validity or enforceability of the Loan and
Servicing Agreement or any other Transaction Document;

                  (iv)  with  respect to the Purchase  and Sale Agreement,  the
status, existence,  perfection, priority or enforceability of Company's interest
in the Receivables or Related Rights; or

                  (v)   the collectibility of the Receivables.

                  "SOLVENT"  means,  with  respect to any Person at any time,  a
condition under which:

                  (i)   the fair value and present fair  saleable  value of such

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