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MidCountry Bank, Pioneer Military Lending
Division
LOAN SALE AND MASTER SERVICES
AGREEMENT
This Loan Sale and Master Services Agreement (the
“Agreement”) is between MidCountry Bank, through its
Pioneer Military Lending Division (the “Bank”) and
Pioneer Funding, Inc. (“Funding”) and the other
affiliated entities which are signatories hereto (Funding and such
other entities being collectively referred to as the
“Customer”) is made effective as of June 1, 2007 (the
“Effective Date”).
1. Overview
This Agreement states the terms and conditions by
which the Bank will sell consumer loans to Funding and provide
various services to the Customer. Additionally, Funding will
purchase consumer loans and the Customer will receive various
services provided by the Bank, including consumer loan servicing
and retail installment contract servicing (collectively, the
“Services”). This Agreement is intended to cover any
and all Services requested by the Customer and provided by the Bank
during the term of this Agreement.
2. Term of Agreement; Termination
(a) The term of this Agreement will begin on the
Effective Date and will expire five years later; provided, however,
on each anniversary of the Effective Date, the term hereof shall be
extended automatically for an additional one-year
period.
(b) Either party may terminate this Agreement upon
not less than 180 days advance written notice to the other party
and to UMB Bank, N.A., or its successor as Agent Bank under that
certain Amended and Restated Senior Lending Agreement dated as of
October 1, 2003, as amended as of May 31, 2007 (the
“SLA”) between Pioneer Financial Services, Inc., UMB
Bank, N.A. and other lenders. Any termination will not affect the
Customer’s obligations to pay for Services provided during
the remainder of the term.
(c) The Bank may also terminate this Agreement or
suspend service upon 30 days notice to the Customer and to UMB
Bank, N.A., or its successor as Agent Bank under the SLA in the
event of (i) a payment default, or (ii) the Customer’s breach
or failure to materially comply with any other obligation of the
Customer under this Agreement and such breach or failure is not
cured within 30 days after receipt of written notice of the same.
The Customer may also terminate this Agreement if the Bank breaches
any material term or condition of this Agreement and fails to cure
such breach within 30 days after receipt of written notice of
same.
3. Sale of Loans
The Bank will originate for sale to Funding military
consumer loans (the “Loans”) made by the Bank in the
ordinary course of business as previously conducted by Pioneer
Financial Services, Inc. (“Pioneer”), one of the
parties and its subsidiaries composing the Customer, and in
accordance with (i) the Bank’s lending policy, and
(ii) the continuing lending guidelines of
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Pioneer, as both may be amended from time to time.
Funding will have the exclusive right to purchase, and shall
purchase, all of such Loans offered for sale by the Bank, and
payment for such Loans shall be settled on a daily basis or on such
other periodic basis as the parties may from time to time
determine. The Bank may also originate for its own account loans
which are not deemed to be military consumer loans made in the
ordinary course of business as previously conducted by Pioneer and
its subsidiaries.
4. Delivery of Services
During the term of this Agreement, the Bank shall
provide to the Customer all of the Services, as more fully
described in Exhibit A
attached hereto and made a part hereof. The Customer
agrees to accept and pay for the Services and for any additional
Services which may be requested and provided pursuant to amendments
to this Agreement.
5. Fees and Payment
The Customer will pay all fees due pursuant
to Exhibit A as
provided therein. Other Services may be billed on a monthly or
other periodic basis. Any payment not received by the Bank within 5
business days of its due date will accrue interest at a rate of one
and one-half percent (1.5%) per month, or the highest rate allowed
by applicable law, whichever is lower. The Customer will be
responsible for and will pay all taxes and similar fees now in
force or enacted in the future imposed on the delivery of
Services.
6. Duties of the Bank
The Bank will provide all of the Services in
accordance with all applicable laws and regulations and such
standards of service as generally prevail in the financial services
industry. The Bank shall indemnify the Customer and hold the
Customer harmless from and against any and all liability, damages,
and costs, including reasonable attorney fees, resulting from the
Bank’s failure to comply with the provisions of this
Agreement.
7. Other Benefits to Certain
Parties
In further consideration of the mutual benefits to
the Bank and the Customer under this Agreement:
(a) Pioneer hereby grants the Bank for the period
ending upon termination of this Agreement, unless otherwise
extended as provided herein, (i) the non-exclusive rights to use
the intellectual properties, including trade names and service
marks, of Pioneer, and (ii) the right to use the Daybreak
system and all hardware and software associated with it.
Notwithstanding the foregoing, Pioneer shall retain all ownership
rights.
(b) During the term hereof, the Customer hereby
grants to the Bank the right to market additional products and
services to the Customer’s borrowers. The Customer shall
retain all other borrower relationship rights.
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8. Rights of Third Party Beneficiary Upon
Termination.
UMB Bank, N.A. and each successor to it, if any, as
Agent Bank under the SLA (the “Agent Bank”) shall be
deemed
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