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GE / Auto-By-Tel - Lease Marketing & Applications Processing Agreement
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MARKETING AND APPLICATION PROCESSING AGREEMENT
This MARKETING AND APPLICATION PROCESSING AGREEMENT ("Agreement"), dated as of February 1, 1997, between General Electric Capital Auto Financial Services, Inc. (GECAFS), a Delaware corporation with its principal place of business at 600 Hart Road, Barrington, Illinois, and Auto-By-Tel Acceptance Corporation ("ABTAC") and Auto-By-Tel Corporation ("ABT") (as guarantor of the obligations of ABTAC under this Agreement, in such capacity, the "Guarantor"), each a Delaware corporation with its principal place of business at 18872 MacArthur Boulevard, Suite 200, Irvine, California 92612.
WITNESSETH:
WHEREAS, ABTAC is in the business of, among other things marketing financial services to persons interested in arranging financing for the lease of new and used motor vehicles ("Vehicles") who visit the ABT Internet website ("Customers") and GECAFS and its affiliates are in the business of purchasing leases of Vehicles from authorized dealers in the business of leasing such goods; and
WHEREAS, ABTAC desires to promote the services of GECAFS to certain such Customers in exchange for a marketing fee, and GECAFS desires to purchase leases and is willing to pay such fees, in connection with new lease accounts opened as a result of ABTAC's marketing;
NOW, THEREFORE, in consideration of the foregoing premises, and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, and intending to be legally bound, ABTAC and GECAFS agree as follows:
SECTION 1.
FINANCING PROGRAM
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(A) ABTAC will cause to be included on the ABT Website, along with specific identification of GECAFS as a participating lender in form and content reasonably satisfactory to GECAFS, either an application in a form reasonably satisfactory to GECAFS, substantially as set forth on Exhibit A hereto, or a nonspecific credit application soliciting information requested by GECAFS. (Each such completed application is referred to herein as a "GECAFS Application" and each Customer who completes a GECAFS Application is referred to herein as an "Applicant.") GECAFS may, from time to time, request changes in the information solicited by such application and ABTAC will use its best efforts to accommodate such requests. GECAFS will be under no obligation hereunder with respect to any GECAFS Application which does not solicit the information requested by GECAFS.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN
PORTIONS OF THIS DOCUMENT.
(B) GECAFS will offer to enter into a contract purchase agreement ("Closing Agreement") with each seller of Vehicles in the continental United States (excluding Alaska and Hawaii) and the District of Columbia ("United States") who has executed an online purchase request referral agreement with ABT and who otherwise meets GECAF's standards for such relationships ("Dealer(s)"). ABTAC will assist GECAFS in securing signed Closing Agreements with Dealers and will provide GECAFS with the address of each Dealer to facilitate this process. The Closing Agreement will contain customary terms no less favorable to the Dealers than GECAFS' customary agreements in use with its other leasing programs and will govern the terms upon which the Dealer and GECAFS will close the Vehicle leasing transactions the subject of this Agreement ("Contracts"). ABTAC agrees, subject to its reasonable business judgment and available resources, to promote its leasing programs to Dealers and to support, assist and cooperate with GECAFS in the marketing of this program, and its proper execution, to Dealers. Upon execution of a Closing Agreement, GECAFS will assign such Dealer an identifying number (the "Dealer ID") and inform ABTAC of such number. GECAFS will be responsible for informing Dealers of the nature of its leasing programs. ABTAC will be responsible for informing Dealers of the nature of its services and the differences, if any, between the programs described by GECAFS and the ABTAC programs.
(C) ABTAC will not be a party to, will have no obligations with respect to and will be held harmless by GECAFS with respect to any act or omission by GECAFS which gives rise to any losses or liabilities arising from or in connection with the Closing Agreements. If for any reason the Closing Agreement between a Dealer and GECAFS is terminated, then GECAFS will be under no obligation to approve any application received from customers of such Dealer.
(D) GECAFS agrees to provide each Applicant lease rates and terms not less favorable to Applicants than those offered by GECAFS to similar customers in its customary lease programs unless ABTAC requests, and GECAFS agrees to offer, less favorable terms. The standard money factor used to derive a monthly payment for any Contract [*]. Upon ten business days' prior written notice, ABTAC may request that GECAFS increase such rate factor, for such Contracts purchased by GECAFS and for such period as ABTAC may specify, by an amount which will result in a remittance to ABTAC, in accordance with Section 6 hereof, of a certain sum requested by ABTAC, not to exceed [*] unless otherwise agreed, for each applicable Contract purchased by GECAFS during such period.
(E) Each GECAFS Application received by ABTAC with respect to which GECAFS is competitive will be forwarded to GECAFS for review until such time as the volume targets set forth in Section 1(F) are achieved. As used herein, "competitive" will mean cases in which the Applicant's monthly Contract payment under the standard GECAFS program applicable to such Contracts would be not more than [*] otherwise available to the Applicant, all other Contract terms being equal, from any other source of financing with whom ABTAC is then doing business under the same or similar terms as ABTAC's agreement with GECAFS. "Competitiveness" will be determined as accurately as possible in good faith with reference to available data. GECAFS and ABTAC each reserves the right to audit the process by which "competitiveness" is determined. If GECAFS declines to proceed with the transaction as described,
[*] CONFIDENTIAL TREATMENT REQUESTED
GECAFS will return such GECAFS Application to ABTAC for additional information or forwarding to another financing source, as the case may be. If ABTAC requests, GECAFS will cooperate with ABTAC in developing a screening methodology based upon GECAFS' underwriting criteria then in effect which would enable ABTAC to forward to GECAFS only those GECAFS Applications meeting an agreed upon subset of credit criteria and to forward the remaining applications to other financing sources. Such responsibilities are illustrated by the Process Map attached hereto as Exhibit B, as may be modified from time to time. GECAFS and ABTAC have agreed upon the responsibilities of each in developing the tools necessary to implement this Process Map and this Agreement.
(F) The terms of this Agreement are based in part upon the expectation by GECAFS of [*] Contract volume targets of [*], respectively, during the [*] of this Agreement and upon the expectation of ABTAC of providing such volume. The standard for "competitiveness" set forth above and volume targets will be subject to review after [*] and periodically thereafter, based upon the extent to which those expectations are being realized.
SECTION 2.
RECEIPT AND TRANSMISSION OF APPLICANT INFORMATION
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(A) Subject to the provisions of Section 1, ABTAC will transmit each completed GECAFS Application to GECAFS by telephone, telefax, email, or other electronic or agreed upon means. Also subject to the provisions of Section 1, ABTAC is under no obligation to screen or review any GECAFS Application before transmission to GECAFS; provided, however, that ABTAC agrees not to transmit incomplete Applications or Applicant information that ABTAC actually knows to be false or misleading in any material respect.
(B) ABTAC also agrees to subject Applicant information to the security and confidentiality procedures consistent with its corporate policies in effect from time to time. ABTAC will not use any such information in any manner which violates applicable law in effect from time to time and will keep communications from GECAFS to Applicants or Dealers confidential.
(C) GECAFS acknowledges and agrees that ABTAC has no liability, duty or obligation with respect to the processing, underwriting, funding, or closing of any lease. Except as set forth herein, ABTAC will have no responsibility for, and makes no representation or warranty in connection with, the truth or accuracy of the information provided by or on behalf of any Applicant or in the GECAFS Application or regarding the eligibility of the Applicant for a lease.
(D) ABTAC will not make, and will use its best efforts to keep any of its employees or agents from making, any oral or written statement to Applicants or Dealers that would discourage, on a basis prohibited by law, an Applicant from making or pursuing any transaction contemplated by this Agreement.
[*] CONFIDENTIAL TREATMENT REQUESTED
SECTION 3.
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(A) Upon receipt, GECAFS will review each GECAFS Application in accordance with its underwriting criteria and applicable law. GECAFS will approve all GECAFS Applications meeting the underwriting criteria unless, in accordance with its usual practice of applying GECAFS' underwriting policies, the Applicant is otherwise not creditworthy. ABTAC acknowledges that GECAFS has sole discretion in determining whether or not to approve a GECAFS Application, which discretion GECAFS agrees to exercise in a manner consistent with its customary underwriting procedures in effect from time to time.
(B) The goal of GECAFS will be to complete its review within [*] after electronic receipt of a GECAFS Application but, absent unusual circumstances, such review will be completed not later than the [*].
(C) GECAFS reserves the sole right and power to change the underwriting criteria in accordance with GECAFS' normal business practices and subject to applicable law, and further to suspend, restrict or modify the purchase of leases in any portion of the United States for regulatory reasons. GECAFS will provide ABTAC with advance written notice, given as early as practicable, of any actions it plans to implement under this Section. Any such actions will be taken in good faith.
SECTION 4.
COMMUNICATION OF CREDIT DECISIONS
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At the completion of underwriting as set forth in Section 3(B) of this Agreement, GECAFS will notify ABTAC of GECAFS' credit decision. ABTAC will notify the Dealer and the Applicant on behalf of GECAFS, in the case of approval and the Applicant in the case of disapproval. If GECAFS declines a request for credit, GECAFS will send to the Applicant any and all notices required, but only those required, pursuant to federal or applicable state law or regulation including, but not limited to, those required under the federal Equal Credit Opportunity Act and Federal Reserve Regulation B.
SECTION 5.
CLOSING AND FUNDING
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After the notification to the Dealer and Applicant, ABTAC will have no responsibility under this Agreement to any of the Dealer (except as set forth in Section l(B)), the Applicant or GECAFS. GECAFS will use its best efforts to close all approved Contracts and will, absent unusual circumstances, remit the proceeds of each Contract to the related Dealer within [*] following compliance with all requirements for submission of Contracts under the terms of the
[*] CONFIDENTIAL TREATMENT REQUESTED applicable Closing Agreement. Contracts submitted incorrectly with respect to the parameters of the ABTAC program will not be accepted by GECAFS but will be corrected by agreement with the Dealer or returned to the Dealer for correction and resubmission provided, however, that GECAFS may afford the Dealer the benefit of any GECAFS program available to its dealers from time to time the effect of which does not adversely affect the applicant's rate. GECAFS will advise ABTAC of the existence and provisions of such programs. ABTAC will assist GECAFS in encouraging Dealers to resubmit such corrected Contracts to GECAFS for approval and not to other lenders.
SECTION 6.
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During the term of this Agreement, GECAFS will pay to ABTAC a marketing fee of [*] for each Contract that is funded under the terms of this Agreement. GECAFS will use its best efforts to effect such payment, and any amount payable pursuant to Section l.D. hereof, [*] for Contracts funded in the prior period but in no event will compensation for any Contract be paid more than [*] after funding. ABTAC will be responsible for compensating the associated Dealer in accordance with its on-line purchase referral agreement with such Dealer.
SECTION 7.
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(A) On or before the 10th day of each month, GECAFS will transmit electronically to ABTAC a report, sorted by Dealer ID and identifying the name of each Applicant, outlining for the preceding month: (1) the number of GECAFS Applications received from ABTAC, (2) the number of GECAFS Applications that were approved and funded, (3) the number of GECAFS Applications pending at month-end and (4) the number and aggregate outstanding balance of Contracts funded during the effectiveness of this Agreement. GECAFS will include with such report a report indicating any Dealers which executed a Closing Agreement and any Closing Agreements which terminated during the preceding month.
(B) On the effective date of this Agreement, ABTAC will advise GECAFS in writing of all sources of financing with whom ABTAC is doing business in the same or similar fashion as GECAFS. On or before the 10th day of each month, ABTAC will advise GECAFS in writing of any additions or deletions to such list. In addition, on or before the 10th day of each month, ABTAC will transmit electronically to GECAFS a report outlining for the preceding month: [*]
[*] CONFIDENTIAL TREATMENT REQUESTED
(C) GECAFS and ABTAC will meet periodically, upon reasonable request, to review all aspects of the program. GECAFS agrees to discuss with ABTAC, not less than quarterly, at least the following aggregate portfolio performance information for the ABTAC leases: [*].
SECTION 8.
STANDARDS FOR TRANSMITTING INFORMATION
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GECAFS will either provide or make available to ABTAC its unique code sets and edit procedures on a periodic basis as deemed necessary by GECAFS to permit performance hereunder. ABTAC will transmit all Applications and other information to GECAFS in the predefined format utilizing such GECAFS code sets and in accordance with such parameters, all as set forth in Exhibit C attached hereto and as may be amended from time to time.
SECTION 9.
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Guarantor hereby unconditionally and irrevocably guarantees to GECAFS, its successors, endorsees and assigns, the performance when due of all present and future obligations and liabilities of all kinds of ABTAC arising out of or in connection with the Agreement, whether due or to become due, secured or unsecured, absolute or contingent, joint or several ("Obligations"). The Guarantor agrees that GECAFS and ABTAC may mutually agree to modify the obligations or any agreement between GECAFS and ABTAC without in any way impairing or affecting this Guarantee.
SECTION 10.
REPRESENTATIONS AND WARRANTIES
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(A) Representations and Warranties Of ABTAC. ABTAC hereby makes the
--------------------------------------- following representations and warranties to GECAFS:
(1) ABTAC has been duly organized and is validly existing as a corporation under the laws of the state of Delaware and is duly licensed where required or is otherwise qualified in each
[*] CONFIDENTIAL TREATMENT REQUESTED state in which it transacts business and is not in default of such state's applicable laws, rules and regulations, except where the failure to so qualify or such default would not have a material adverse effect on its ability to conduct its business or to perform its obligations under the Agreement.
(2) ABTAC has the requisite power and authority and legal right to execute and deliver the Agreement, engage in the transactions contemplated by the Agreement, and perform and observe those terms and conditions of the Agreement to be performed or observed by it hereunder. The person signing the Agreement, and any document executed pursuant to it, on behalf of ABTAC has full power and authority to bind ABTAC. The execution, delivery and performance of the Agreement, and the performance by ABTAC of all transactions contemplated therein, have been duly authorized by all necessary and appropriate corporate action on the part of ABTAC.
(3) The Agreement has been duly authorized and executed by ABTAC and is valid, binding and enforceable against ABTAC in accordance with its terms, except that such enforcement may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws (whether statutory, regulatory or decisional) now or hereafter in effect relating to creditors' rights generally, and the execution, delivery and performance by ABTAC of the Agreement do not conflict with any term or provision of (a) its certificate of incorporation or bylaws, (b) any law, rule, regulation, order, judgment, writ, injunction or decree applicable to ABTAC of any court, regulatory body, administrative agency or governmental body having jurisdiction over ABTAC or (3) any agreement to which ABTAC is a party or by which its property is bound.
(4) No consent, approval, authorization or order of...
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