Forward-Looking Statements and Available Information

EX-10.33 27 a88051exv10w33.txt EXHIBIT 10.33 EXHIBIT 10.33 SECURED DEPOSIT ACCOUNT AGREEMENT This Secured Deposit Account Agreement ("Agreement") is made as of this 17th day of October, 2002, by and between Western Financial Bank ("WFB"), a federally chartered savings institution and WFS Receivables Corporation 2 ("WFSRC2"), a Nevada corporation, and is based upon the following recitals. The aforementioned parties shall hereinafter be collectively referred to as "Companies." RECITALS A. Whereas, Westcorp is the holding company of WFB and WFSRC2; B. Whereas, WFSRC2 and Deutche Bank AG, New York Branch ("Deutche") have entered into a Cash Collateral Agreement dated as of March 28, 2002 (the "CCA Agreement") requiring WFSRC2 to pay $7 million dollars (the "Funds") into a cash collateral account ("CCA"); C. Whereas, WFB, in order to borrow at a more favorable interest rate than it would otherwise be able to receive and in order to induce WFSRC2 to invest the Funds into a general liability account with WFB, desires to pay WFSRC2 interest at a rate equal to one (1) month LIBOR, and shall accrue daily; D. Whereas, WFB shall use mortgage backed securities valued equal to or above $7million dollars to collateralize the CCA on behalf of WFSRC2 and pursuant to the CCA Agreement, if WFSRC2 invests the Funds into a WFB account; and E. Whereas, WFSRC2 desires to invests the Funds into a WFB account in order to obtain a higher rate of return on the Funds. NOW THEREFORE, in consideration of the above recitals, the Companies hereto agree as follows: AGREEMENT In consideration of the mutual promises set forth herein, and in reliance upon the recitals set forth above, the parties agree as follows: 1. The above recitals are hereby incorporated into this Agreement by reference and made a part hereto. 2. WFSRC2 Obligations. WFSRC2 shall invest the Funds into a general liability account with WFB. 3. WFB Obligations. 3.1 WFB shall pay WFSRC2 interest at a rate of 1-month LIBOR on the Funds, and shall accrue daily. The LIBOR rate used shall be the LIBOR rate in effect on the last day of the prior month by WFB. 3.2 Upon receipt of the Funds and pursuant to the CCA Agreement, WFB shall collateralize the CCA with mortgage backed securities valued equal to or above $7million dollars. 1 4. Further Assurances. The Companies agree that they will modify, amend, or restate any provision of this Agreement as necessary in order to insure that this Agreement complies with all applicable federal laws and OTS regulations with respect to transacting business between the parties. 5. Term. 5.1 This Agreement shall commence as of the date stated above and shall continue until terminated by the parties. 5.2 This Agreement may be terminated immediately for breach of any covenant, obligation, or duty therein contained or for violation of law, ordinance, statute, rule or regulation (collectively referred to as "law") governing the conduct of any party hereto. 5.3 Termination shall not effect the obligations of the Companies with respect to any event occurring before termination. Each Company shall be bound by and responsible for any transaction or expense properly agreed to or incurred by the other Company in connection with services performed hereunder but not settled, paid or reimbursed prior to the date of any such termination. Upon termination of this Agreement, the fee referred to above will be prorated, but the due date thereof shall not be changed. 6. Representations and Warranties of Each Company. Each Company on its behalf alone represents and warrants to and for the benefit of the other Company as follows: 6.1 Corporate Existence and Qualifications. Each Company is either a corporation or association duly organized, validly existing and in good standing under the laws of the United States or of the State of California, as applicable, with full corporate power to own its properties and to carry on its business as now owned and operated by Company. 6.2 Licenses: Compliance with Laws. Each Company has all licenses, franchises, permits and authorizations necessary ("Licenses"), or is otherwise exempt from having to obtain such Licenses, for the lawful conduct by the respective Company of its business. Neither Company has violated, nor is in violation of, any such licenses, franchises, permits or authorizations or any applicable statues, laws, ordinances, rules or regulations of any federal, state, or local governmental bodies, agencies or subdivisions having, asserting or claiming jurisdiction over it or over any part of its operations. 7. Covenants Regarding Corporate Existence. 7.1 Preservation of Corporate Existence and Qualifications. Each Company shall keep in full effect its existence, rights and franchises as a corporation or association under the laws of the jurisdiction in which each is organized and will obtain and preserve its qualifications to carry on business as a foreign corporation in each jurisdiction in which such qualification is or shall be necessary. 7.2 Observation of Corporate Formalities. Each Company shall at all times observe the applicable legal requirements for the recognition of Company as a corporate entity 2 separate and apart from any other Company, including without limitation the following: (a) Each Company shall maintain corporate records and books of account separate from those of every other Company; (b) Each Company shall hold meetings of its Board of Directors as appropriate to authorize its corporate actions; (c) Each Company shall hold meetings of its shareholder(s) as appropriate and as required by applicable law in the jurisdiction in which organized to authorize its corporate actions; (d) Each Company shall file all reports required by the Secretary of State in any and all jurisdictions in which that Company is licensed or qualified, including the annual statement by whatever name denominated, in a timely manner; and (e) Each Company shall ensure that any applicable yearly franchise taxes are paid in a timely manner so as to maintain its corporate existence uninterrupted. 7.3 OTS Regulations. Each Company shall comply with all applicable OTS regulations, including, but not limited to, 12 C.F.R. Sections 563.41 and 563.42. 8. Liability: Consultation with Counsel. With respect to the obligations hereunder, no Company shall assume responsibility or liability with respect to the business or affairs of any other Company except to the extent provided for in this Agreement. Each benefiting Company under this Agreement ("Indemnitor") shall indemnify, defend and hold harmless the performing Company against and in respect of any and all claims, demands, losses, costs, expenses, obligations, liabilities, damages, recoveries and deficiencies (collectively the "Claims), including without limitation interest penalties and attorney's fees, that such performing Company shall incur or suffer, which arise, result from or relate to (i) conduct by Indemnitor of its business and operations and (ii) breach by Indemnitor of its obligations pursuant to this Agreement. Notwithstanding anything contained herein to the contrary, Indemnitor's obligations pursuant to this section shall not be applicable to Claims arising directly from the performing Company's bad faith, gross negligence or willful misconduct. This Agreement shall create no right, benefit or privilege in favor of any person not a party hereto, and no person not a party hereto shall have any recourse against the performing Company for any advice, service or facility provided or omitted by performing Company pursuant to this Agreement. The performing Company may consult with legal counsel (who may also be counsel to Indemnitor) concerning any questions that may arise with respect to its duties and obligations hereunder, and it shall be fully protected in respect of any action taken or omitted by it hereunder in good faith reliance on any opinion of such counsel with respect to any such duty or obligation. 3 9. General. 9.1 This Agreement may be modified, amended or superseded in whole or in part, at any time, by a writing executed by the parties hereto. 9.2 The laws of California shall govern this Agreement, except to the extent federal law or regulation supersedes any such laws. 9.3 This Agreement may be executed in counterparts, all of which, taken together shall constitute one agreement. 9.4 No Company shall assign this Agreement without the prior written consent of each of the other Companies, which consent shall not unreasonably be withheld. Wherefore, the undersigned have executed this Agreement as of the date first set forth above. WESTERN FINANCIAL BANK BY: ----------------------------------- Its WFS RECEIVABLES CORPORATION 2 BY: ----------------------------------- Its 4