Exhibit 10.3

 

Execution Version

 

 

 

PURCHASE AND SALE AGREEMENT

 

Dated as of October 16, 2020

 

between

 

CONN’S RECEIVABLES FUNDING 2020-A, LLC
as Purchaser,

 

and

 

CONN APPLIANCES RECEIVABLES FUNDING, LLC
as Seller

 

 

 

 

 

 

TABLE OF CONTENTS

 

    Page ARTICLE I DEFINITIONS 1 SECTION 1.1 Certain Defined Terms 1 SECTION 1.2
Accounting and UCC Terms 2       ARTICLE II AMOUNTS AND TERMS OF THE PURCHASES 2
SECTION 2.1 Purchase of the Receivables Trust Certificate 2 SECTION 2.2 Purchase
Price 3 SECTION 2.3 Payment of Purchase Price 3       ARTICLE III CONDITIONS TO
PURCHASES 3 SECTION 3.1 Conditions Precedent to Purchaser’s Purchase 3
SECTION 3.2 Conditions Precedent to Seller’s Sale 4       ARTICLE IV
REPRESENTATIONS AND WARRANTIES 4 SECTION 4.1 Representations and Warranties of
the Parties 4 SECTION 4.2 Additional Representations of the Seller 5      
ARTICLE V GENERAL COVENANTS 6 SECTION 5.1 Affirmative Covenants of the Seller 6
SECTION 5.2 Negative Covenants of the Seller 8       ARTICLE VI INDEMNIFICATION
9 SECTION 6.1 Indemnities by the Seller 9       ARTICLE VII MISCELLANEOUS 9
SECTION 7.1 Amendments, Etc 9 SECTION 7.2 Notices Etc 10 SECTION 7.3 No Waiver;
Remedies 10 SECTION 7.4 Binding Effect; Governing Law 10 SECTION 7.5 Costs,
Expenses and Taxes 10 SECTION 7.6 No Bankruptcy Petition 11 SECTION 7.7
Acknowledgment of Assignments 11 SECTION 7.8 Waiver of Setoff 11 SECTION 7.9
Severability 11 SECTION 7.10 Counterparts 11 SECTION 7.11 Jurisdiction; Consent
to Service of Process 12 SECTION 7.12 Third Party Beneficiaries 12 SECTION 7.13
Confirmation of Intent 12 SECTION 7.14 Section and Paragraph Headings 13
SECTION 7.15 Interest 13

 

 

 

 

PURCHASE AND SALE AGREEMENT

 

PURCHASE AND SALE AGREEMENT dated as of October 16, 2020, by and between CONN
APPLIANCES RECEIVABLES FUNDING, LLC, a Delaware limited liability company, as
seller (the “Seller”), and CONN’S RECEIVABLES FUNDING 2020-A, LLC, a Delaware
limited liability company, as purchaser (the “Purchaser”).

 

W I T N E S S E T H:

 

WHEREAS, the Seller intends to sell the Receivables Trust Certificate on the
Closing Date to the Purchaser on the terms and subject to the conditions set
forth in this Agreement;

 

WHEREAS, to obtain the necessary funds to purchase the Receivables Trust
Certificate, the Purchaser and Wells Fargo Bank, National Association, as
Trustee (the “Trustee”), have entered into the Base Indenture, dated as of the
date hereof (the “Indenture”);

 

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

 

ARTICLE I
DEFINITIONS

 

SECTION 1.1 Certain Defined Terms. Capitalized terms used in this Agreement but
not defined herein shall have the meanings assigned to such terms in the
Indenture. This Agreement is the Purchase and Sale Agreement referred to in the
Indenture. As used in this Agreement, the following terms shall have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined):

 

“Business Day” shall mean a day on which each of Seller and Purchaser is open at
its respective address specified in this Agreement for the purpose of conducting
its business.

 

“Cash Purchase Price” has the meaning assigned to that term in Section 2.3.

 

“Contingent Liability” means any agreement, undertaking or arrangement by which
any Person guarantees, endorses or otherwise becomes or is contingently liable
upon (by direct or indirect agreement, contingent or otherwise, to provide funds
for payment, to supply funds to, or otherwise to invest in, a debtor, or
otherwise to assure a creditor against loss) the indebtedness, obligation or any
other liability of any other Person (other than by endorsements of instruments
in the course of collection), or guarantees the payment of dividends or other
distributions upon the shares of any other Person. The amount of any Person’s
obligation under any Contingent Liability shall (subject to any limitation set
forth therein) be deemed to be the outstanding principal amount (or maximum
outstanding principal amount, if larger) of the debt, obligation or other
liability guaranteed thereby.

 

“Governmental Authority” means any government or political subdivision or any
agency, authority, bureau, central bank, commission, department or
instrumentality of any such

 

 

 

 

government or political subdivision, or any court, tribunal, grand jury or
arbitrator in each case whether foreign or domestic.

 

“Highest Lawful Rate” means the maximum nonusurious interest rate, if any, that
at any time or from time to time may be contracted for, taken, reserved, charged
or received under this Agreement, under laws applicable to the Seller and the
Purchaser that are presently in effect or, to the extent allowed by law, under
such applicable laws that may hereafter be in effect and that allow a higher
maximum nonusurious interest rate than applicable laws now allow.

 

“Purchase Date” means October 16, 2020.

 

“Purchase Price” has the meaning assigned to that term in Section 2.2.

 

“Solvent” means with respect to any Person that as of the date of determination
both (A)(i) the then fair saleable value of the property of such Person is
(y) greater than the total amount of liabilities (including Contingent
Liabilities) of such Person and (z) not less than the amount that will be
required to pay the probable liabilities on such Person’s then existing debts as
they become absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (ii) such Person’s
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
“solvent” within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances. For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.

 

SECTION 1.2 Accounting and UCC Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP applied on a basis
consistent with the most recent audited financial statements of the Consolidated
Parent before the Closing Date; and all terms used in Article 9 of the UCC that
are used but not specifically defined herein are used herein as defined therein.

 

ARTICLE II
AMOUNTS AND TERMS OF THE PURCHASES

 

SECTION 2.1 Purchase of the Receivables Trust Certificate.

 

(a)            The Seller hereby sells, assigns, transfers and conveys to the
Purchaser on the Closing Date, on the terms and subject to the conditions
specifically set forth herein, all of its right, title and interest, in the
Receivables Trust Certificate and all proceeds thereof whether now owned or
hereafter acquired and all rights of the Receivables Trust under the Transaction
Documents, including but not limited to the right to cause the repurchase of
Ineligible Receivables pursuant to such document.

 

(b)            The parties to this Agreement intend that the transactions
contemplated hereby shall be, and shall be treated as, a purchase by the
Purchaser and a sale by the Seller of the

 

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Receivables Trust Certificate and not as a lending transaction. The sale by the
Seller hereunder shall be without recourse to, or representation or warranty of
any kind (express or implied) by, the Seller, except as otherwise specifically
provided herein.

 

SECTION 2.2 Purchase Price. The amount payable by the Purchaser (the “Purchase
Price”) for the Receivables Trust Certificate shall be $391,747,634.07.

 

SECTION 2.3 Payment of Purchase Price.

 

(a)            The Purchase Price for the Receivables Trust Certificate shall be
paid by a cash payment made by the Purchaser to the Seller in the amount of
$238,470,455.76 (the “Cash Purchase Price”) and the balance of the Purchase
Price to the extent not paid in cash shall be paid by the transfer of the
Class C Notes and the Class R Notes to the Seller.

 

(b)            All payments hereunder shall be made not later than 2:00 EST (New
York time) on the Closing Date in lawful money of the United States of America
in same day funds to the bank account designated in writing by the Seller to the
Purchaser.

 

ARTICLE III
CONDITIONS TO PURCHASES

 

SECTION 3.1 Conditions Precedent to Purchaser’s Purchase. The obligation of the
Purchaser to purchase the Receivables Trust Certificate hereunder on the Closing
Date is subject to the conditions precedent (any one or more of which can be
waived by the Purchaser) that (a) the Indenture and the other Transaction
Documents shall be in full force and effect and all conditions to the advance
under the Indenture shall have been satisfied or waived, (b) the Purchaser shall
have received on or before the Closing Date the following, each (unless
otherwise indicated) dated the Closing Date and in form and substance
satisfactory to the Purchaser and (c) the conditions set forth in clauses (iii),
(iv) and (v) shall have been satisfied:

 

(i)            a copy of duly adopted resolutions of the Seller’s Sole Member
authorizing or ratifying the execution, delivery and performance of the
Transaction Documents to which it is a party, certified by the Seller’s Sole
Member;

 

(ii)           a duly executed certificate of the Seller’s Secretary or
Assistant Secretary certifying the names and true signatures of the officers
authorized on behalf of the Seller to sign the Transaction Documents to which it
is a party;

 

(iii)          the Seller shall have filed and recorded with respect to the sale
of the Receivables Trust Certificate, at its own expense, UCC-1 financing
statements with respect to the Receivables Trust Certificate in such manner and
in such jurisdictions as are necessary or desirable to perfect the Purchaser’s
ownership interest thereof under the UCC and delivered a file-stamped copy of
such UCC-1 financing statements or other evidence of such filings to the
Purchaser within five Business Days of the Closing Date; and all other action
necessary or desirable, in the opinion of the Purchaser or the Trustee, to
establish the Purchaser’s ownership of the Receivables Trust Certificate shall
have been duly taken;

 

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(iv)          the Purchaser and the Trustee shall have received photocopies of
reports of UCC searches in the central filing office of the Seller and any
necessary local offices the Seller with respect to the Receivables Trust
Certificate reflecting the absence of Liens thereon, except the Liens created
hereunder, pursuant to the Indenture in favor of the Trustee and except for
Liens as to which the Purchaser has received UCC termination statements or
instruments executed by secured parties releasing any conflicting Liens in the
Receivables Trust Certificate and other assets purchased pursuant to
Section 2.1(a); and

 

(v)           the Purchaser and the Trustee shall have received such other
approvals, documents, certificates and opinions as the Purchaser or the Trustee
may request.

 

SECTION 3.2 Conditions Precedent to Seller’s Sale. The obligation of the Seller
to make its sale hereunder is subject to the conditions precedent that the
Seller shall have received on or before the date of such sale the following,
each (unless otherwise indicated) dated the day of such sale and in form and
substance satisfactory to the Seller:

 

(a)            a copy of duly adopted resolutions of the Purchaser authorizing
this Agreement, the documents to be delivered by the Purchaser hereunder and the
transactions contemplated hereby, certified by the Secretary or Assistant
Secretary of the Purchaser; and

 

(b)            a duly executed certificate of the Secretary or Assistant
Secretary of the Purchaser certifying the names and true signatures of the
officers authorized on its behalf to sign this Agreement and the other documents
to be delivered by it hereunder.

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

 

SECTION 4.1 Representations and Warranties of the Parties. The Purchaser and the
Seller each represents and warrants as to itself as follows:

 

(a)            Each of the Seller and the Purchaser has been duly organized and
is validly existing and in good standing under the laws of the state of its
organization, with full power and authority to own its properties and to conduct
its business as presently conducted. Each of the Seller and the Purchaser is
duly qualified to do business and is in good standing as a foreign entity (or is
exempt from such requirements), and has obtained 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 the conduct of
the Seller’s or the Purchaser’s business.

 

(b)            The sale of Receivables Trust Certificate pursuant to this
Agreement, the performance of its obligations under this Agreement and the
consummation of the transactions herein contemplated have been duly authorized
by all requisite action and will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance (other than pursuant
to this Agreement or the other Transaction Documents) upon any of its property
or assets or upon that of the Seller or the Purchaser, pursuant to the terms of
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which it, the Seller or the Purchaser is a

 

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party by which it, the Seller or the Purchaser is bound or to which any property
or assets of it, the Seller or the Purchaser is subject, nor will such action
result in any violation of the provisions of its organizational documents or of
any statute or any order, rule or regulation of any federal or state court or
governmental agency or body having jurisdiction over it, the Seller or the
Purchaser or any of its their respective properties; and no consent, approval,
authorization, order, registration or qualification of or with any such court or
any such regulatory authority or other such governmental agency or body is
required to be obtained by or with respect to the Seller or the Purchaser for
the sale of the Receivables Trust Certificate or the consummation of the
transactions contemplated by this Agreement.

 

(c)            This Agreement has been duly executed and delivered by the Seller
and the Purchaser and constitutes a valid and legally binding obligation of the
Seller and the Purchaser, respectively, enforceable against the Seller and the
Purchaser, respectively, in accordance with its terms, except that the
enforceability thereof may be subject to (a) the effects of any applicable
bankruptcy, insolvency, reorganization, receivership, conservatorship or other
laws, regulations and administrative orders affecting the rights of creditors
generally and (b) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or law).

 

(d)            There is no pending or, to its knowledge after due inquiry,
threatened action or proceeding affecting it or any of its Subsidiaries before
any court, governmental agency or arbitrator, that may reasonably be expected to
materially and adversely affect its condition (financial or otherwise),
operations, properties or prospects, or that purports to affect the legality,
validity or enforceability of this Agreement. None of the transactions
contemplated hereby is or is threatened to be restrained or enjoined
(temporarily, preliminarily or permanently).

 

SECTION 4.2 Additional Representations of the Seller. The Seller additionally
represent and warrant as follows:

 

(a)            Sale of Receivables Trust Certificate. The Seller is, as of the
time of the transfer to the Purchaser of the Receivables Trust Certificate being
sold to the Purchaser by it hereunder on the Closing Date, the sole owner of
such Receivables Trust Certificate free from any Lien other than those released
at or prior to such transfer. There is no effective financing statement (or
similar statement or instrument of registration under the law of any
jurisdiction) now on file or registered in any public office filed by or against
any Originator, the Seller or any Subsidiary of any Originator or the Seller or
purporting to be filed on behalf of any Originator, the Seller or any Subsidiary
of any Originator or the Seller covering any interest of any kind in any
Contracts and related Receivables Trust Certificate and any Originator and the
Seller will not execute nor will there be on file in any public office any
effective financing statement (or similar statement or instrument of
registration under the laws of any jurisdiction) or statements relating to such
Contracts and related Receivables Trust Certificate, except (i) in each case any
financing statements filed in respect of and covering the purchase of the
Contracts and related Receivables Trust Certificate by the Purchaser or filed in
connection with the Transaction Documents and (ii) financing statements for
which a release of Lien has been obtained or that has been assigned to the
Purchaser or the Trustee. All filings and recordings (including pursuant to the
UCC) required to perfect the title of the Purchaser in each Contract or the
Receivables Trust Certificate sold hereunder have been accomplished and are in
full force and effect, or will be accomplished and in full force and effect
prior to the time required in clause (iii) of Section 3.1, and the Seller shall

 

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at its expense perform all acts and execute all documents necessary or
reasonably requested by the Purchaser, the Receivables Trust, the Issuer or the
Trustee at any time and from time to time to evidence, perfect, maintain and
enforce the title or the security interest of the Purchaser or the Receivables
Trust in the Receivables Trust Certificate and the priority thereof.

 

(b)            Financial Statements. The Seller has heretofore made available to
the Purchaser and the Trustee copies of Consolidated Parent’s consolidated
balance sheets and statements of income and changes in financial condition as of
and for the Fiscal Year ended January 31, 2020, audited by and accompanied by
the opinion of Ernst and Young independent public accountants. Except as
disclosed to the Trustee prior to the date of this Agreement, such financial
statements present fairly in all material respects the financial condition and
results of operations of Consolidated Parent and its consolidated subsidiaries
as of such dates and for such periods; such balance sheets and the notes thereto
disclose all liabilities, direct or contingent, of the Consolidated Parent and
its consolidated subsidiaries as of the dates thereof required to be disclosed
by GAAP and such financial statements were prepared in accordance with GAAP
applied on a consistent basis. Since January 31, 2020, there has been no
material adverse change in the condition (financial or otherwise), operations,
properties, assets or prospects of the Seller and its Subsidiaries.

 

(c)            No Consent. No action, consent or approval of, registration or
filing with or any other action by any Governmental Authority (other than the
UCC financing statements required to be filed hereby) is or will be required in
connection with execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated by this Agreement, except such as
have been made or obtained and are in full force and effect.

 

(d)            Security Interest of Purchaser. This Agreement and all related
documents constitute a valid sale, transfer and assignment to the Purchaser of
all right, title and interest in the Receivables Trust Certificate and the
proceeds thereof. Upon the receipt of the Receivables Trust Certificate, the
Purchaser shall have a first priority perfected security interest in all of the
property described in Section 2.1(a) (except to the extent such first priority
perfected security interest was assigned to the Trustee pursuant to the
Indenture).

 

(e)            Solvency. The Seller is Solvent.

 

ARTICLE V
GENERAL COVENANTS

 

SECTION 5.1 Affirmative Covenants of the Seller. So long as the Purchaser shall
have any interest in the Receivables Trust Certificate, the Seller shall, unless
the Purchaser otherwise consents in writing:

 

(a)            Financial Statements, Reports, Etc. Deliver or cause to be
delivered to the Purchaser, the Receivables Trust, and the Trustee:

 

(i)            as soon as available and in any event within 90 days after the
end of each Fiscal Year of the Consolidated Parent, a balance sheet of the
Consolidated Parent as of the end of such year and statements of income and
retained earnings and of source and application of funds of the Seller for the
period commencing at the end of the previous

 

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Fiscal Year and ending with the end of such year, in each case setting forth
comparative figures for the previous Fiscal Year, certified without material
qualification in a manner satisfactory to the Purchaser and the Trustee by Ernst
and Young or other nationally recognized, independent public accountants,
together with a certificate of such accounting firm stating that in the course
of the regular audit of the business of the Seller, which audit was conducted in
accordance with generally accepted auditing standards in the United States;

 

(ii)           as soon as available and in any event within 45 days after the
end of each fiscal quarter, quarterly balance sheets and quarterly statements of
source and application of funds and quarterly statements of income and retained
earnings of the Consolidated Parent, certified by the chief financial or
executive officer of the Consolidated Parent (which certification shall state
that such balance sheets and statements fairly present the financial condition
and results of operations for such fiscal quarter, subject to year-end audit
adjustments).

 

For so long as Consolidated Parent is subject to the reporting requirements of
Section 13(a) of the Exchange Act, its filing of the annual and quarterly
reports required under the Exchange Act, on a timely basis, shall be deemed
compliance with clauses (i) and (ii) of this paragraph (a).

 

(b)            Preservation of Existence. Preserve and maintain in all material
respects its corporate existence, corporate rights (charter and statutory) and
franchises.

 

(c)            Obligations and Taxes. Pay and discharge promptly when due all
material obligations, all sales tax and all material taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
in respect of its property before the same shall become in default, as well as
all material lawful claims for labor, materials and supplies or otherwise which,
if unpaid, might become a Lien or charge upon such properties or any part
thereof; provided, however, that it and each Subsidiary shall not be required to
pay and discharge or to cause to be paid and discharged any such tax,
assessment, charge, levy or claim so long as the validity or amount thereof
shall be contested in good faith by appropriate proceedings and for which the
Seller shall have set aside on its books adequate reserves with respect thereto.

 

(d)            Obligation to Record and Report. The Seller will treat the
purchase of the Receivables Trust Certificate as a sale or secured financing for
tax and financial accounting purposes (as required by GAAP) and as a sale for
all other purposes (including, without limitation, legal and bankruptcy
purposes), on all relevant books, records, tax returns, financial statements and
other applicable documents.

 

(e)            Continuing Compliance with the Uniform Commercial Code. At the
Seller’s expense perform all acts and execute all documents necessary or
reasonably requested by the Purchaser or the Receivables Trust Trustee at any
time to evidence, perfect, maintain and enforce the title or the security
interest of the Purchaser or the Receivables Trust Trustee in the Receivables
Trust and the priority thereof. The Seller will execute and deliver financing
statements relating to or covering the Receivables Trust Certificate sold to the
Purchaser (reasonably satisfactory in form and substance to the Purchaser).

 

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(f)            Financing Statement Changes. Within 30 days after the Seller
makes any change in its, name, identity or corporate structure that would make
any financing statement or continuation statement filed in accordance with this
Agreement seriously misleading within the meaning of Section 9-506 of the UCC,
the Seller shall give the Purchaser notice of any such change and shall file
such financing or continuation statements or amendments to previously filed
financing statements as may be necessary to continue the perfection of the
interest of the Purchaser in the Receivables Trust Certificate and the proceeds
of the foregoing.

 

SECTION 5.2 Negative Covenants of the Seller. So long as the Purchaser shall
have any interest in the Receivables Trust Certificate, the Seller shall not,
unless the Purchaser otherwise consents in writing:

 

(a)            Liens. Sell, assign (by operation of law or otherwise) or
otherwise dispose of, or create or suffer to exist any Lien upon or with respect
to the Receivables Trust Certificates with respect thereto, or assign any right
to receive proceeds in respect thereof except as created or imposed by this
Agreement or the Indenture.

 

(b)            Change in Business. Make any material change in the nature of its
business as carried on at the date hereof or engage in or conduct any business
or activity that is materially inconsistent with such business.

 

(c)            No Amendments. (i) Amend, supplement or otherwise modify this
Agreement or (ii) otherwise take or fail to take any action under this Agreement
that could adversely affect the Purchaser’s interests hereunder or the Trustee’s
interests under the Indenture.

 

(d)            Mergers; Sales of Assets. Sell all or substantially all of its
property and assets to, or consolidate with or merge into, any other
corporation, if the effect of such sale or merger would cause a “Default” or an
“Event of Default” under this Agreement or the Indenture.

 

(e)            Accounting Changes. Make any material change (i) in accounting
treatment and reporting practices except as permitted or required by GAAP,
(ii) in tax reporting treatment except as permitted or required by law, and
(iii) in the calculation or presentation of financial and other information
contained in any reports delivered hereunder.

 

(f)            Maintenance of Separate Existence. (i) Fail to do all things
necessary to maintain its existence separate and apart from the Purchaser
including, without limitation, maintaining appropriate books and records
(including current minute books); (ii) except as required by applicable law,
suffer any limitation on the authority of its own directors and officers or
partners to conduct its business and affairs in accordance with their
independent business judgment, or authorize or suffer any Person other than its
own officers and directors or partners to act on its behalf with respect to
matters (other than matters customarily delegated to others under powers of
attorney) for which a corporation’s or limited partnership’s own officers and
directors or partners would customarily be responsible; (iii) fail to
(A) maintain or cause to be maintained by an agent of the Seller under the
Seller’s control physical possession of all its books and records, (B) maintain
capitalization adequate for the conduct of its business, (C) account for and
manage all of its liabilities separately from those of any other Person,
including, without limitation, payment by it of all payroll and other
administrative expenses and taxes from its own assets,

 

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(D) segregate and identify separately all of its assets from those of any other
Person, (E) maintain employees, or pay its employees, officers and agents for
services performed for the Seller or (F) allocate shared overhead fairly and
reasonably; or (iv) commingle its funds with those of the Purchaser or use the
Purchaser’s funds for other than the uses permitted under the Transaction
Documents.

 

ARTICLE VI
INDEMNIFICATION

 

SECTION 6.1 Indemnities by the Seller. Without limiting any other rights that
the Purchaser may have hereunder or under applicable law, the Seller hereby
agrees to indemnify the Purchaser (and its assignees) and its officers,
directors, agents and employees (each a “PSA Indemnified Party”) from and
against any and all claims, losses and liabilities (including, without
limitation, reasonable attorneys’ fees and disbursements) (all the foregoing
being collectively referred to as “PSA Indemnified Amounts”) awarded against or
incurred by any of them arising out of or resulting from the Seller’s failure to
perform its obligations under this Agreement excluding, however, PSA Indemnified
Amounts to the extent resulting from gross negligence (it being the intention of
the parties that the PSA Indemnified Party shall be indemnified for its own
ordinary negligence) or willful misconduct on the part of such PSA Indemnified
Party. Such indemnity shall survive the execution, delivery, performance and
termination of this Agreement.

 

ARTICLE VII
MISCELLANEOUS

 

SECTION 7.1 Amendments, Etc.

 

(a)            This Agreement may be amended from time to time by the parties
hereto, without the consent of any Noteholder but with prior written consent of
the Certificateholder, for the purpose of (i) curing any ambiguity, correcting
or supplementing any provision which may be inconsistent with any other
provision herein, the Offering Memorandum and/or any other Transaction Document,
(ii) complying with applicable law or regulation or (iii) adding any provisions
to, or changing in any manner or eliminating any of the provisions of, this
Agreement, so long as, in each case, such amendment shall not materially
adversely affect the interests of any Noteholder. An amendment will be deemed
not to materially adversely affect the interests of any Noteholder if
accompanied by: (i) an Opinion of Counsel, (ii) Conn’s Officer’s Certificate
certifying that such amendment will not materially adversely affect the
interests of any Noteholder or (iii) satisfaction of the Rating Agency
Condition.

 

(b)            No amendment, modification or waiver of any provision of this
Agreement, or consent to any departure by the Seller therefrom, shall in any
event be effective unless the same shall be in writing and signed by the
Purchaser and the Trustee and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
Notwithstanding anything herein to the contrary, no amendment shall be made to
this Agreement that would result in or cause (i) the Receivables Trust or the
Issuer to be subject to any net entity-level tax, or (ii) the Receivables Trust
to be classified, for United States federal income tax purposes, as an
association (or a publicly traded partnership) taxable as a corporation or as
other

 

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than a fixed investment trust described in Treasury Regulation
Section 301.7701-4(c) that is treated as a grantor trust under Subpart E, Part I
of subchapter J, Chapter 1 of Subtitle A of the Code. No amendment of this
Agreement which affects the rights, duties, liabilities, indemnities or
immunities of the Receivables Trust Trustee, shall be effective without, in each
specific instance, the prior written approval of the Receivables Trust Trustee.

 

(c)            It shall not be necessary to obtain the consent of the
Noteholders pursuant to this Section 7.1 to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent shall
approve the substance thereof.

 

(d)            Prior to the execution of any amendment pursuant to this
Section 7.1, the Issuer shall provide written notification of the substance of
such amendment to each Rating Agency and promptly after the execution of any
such amendment, the Issuer shall furnish a copy of such amendment to each Rating
Agency.

 

SECTION 7.2 Notices Etc. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telex, facsimile or cable
communication) and mailed, telegraphed, telexed, transmitted, cabled or
delivered, if to the Seller, at its address at 2445 Technology Forest Blvd.,
Suite 800, The Woodlands, TX, 77381; if to the Purchaser, at its address at 2445
Technology Forest Blvd., Suite 800, The Woodlands, TX, 77381; or, as to each
party, at such other address as shall be designated by such party in a written
notice to the other parties. All such notices and communications shall when
mailed or telecopied be effective when deposited in the mails, or transmitted by
telecopier, respectively. The parties hereto acknowledge and agree that the
Purchaser and each assignee of its rights hereunder shall be an assignee of any
rights of the Seller with respect to refunds of sales taxes.

 

SECTION 7.3 No Waiver; Remedies. No failure on the part of the Purchaser to
exercise, and no delay in exercising, any right under this Agreement shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right 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 7.4 Binding Effect; Governing Law. This Agreement shall be binding upon
and inure to the benefit of the Seller and the Purchaser and their respective
successors and assigns, except that the Seller shall not have the right to
assign its rights hereunder or any interest herein without the prior written
consent of the Purchaser. This Agreement shall create and constitute the
continuing obligations of the parties hereto in accordance with its terms, and
shall remain in full force and effect until such time that the Purchaser shall
not have any interest in the Receivables Trust Certificate and all obligations
of the Seller hereunder shall have been paid in full; provided, however, that
the indemnification provisions of Article VI shall be continuing and shall
survive any termination of this Agreement. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of Texas without regard
to the conflict of laws principles thereof.

 

SECTION 7.5 Costs, Expenses and Taxes. In addition to the rights of
indemnification granted to the Purchaser under Article VI, the Seller agrees to
pay on demand all costs and expenses of the Purchaser, the Issuer and the
Trustee in connection with the preparation,

 

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execution and delivery of the Transaction Documents and the other agreements and
documents to be delivered hereunder and thereunder, including, without
limitation, the reasonable fees and out-of-pocket expenses of counsel for the
Purchaser and the Trustee with respect thereto and with respect to advising the
Purchaser and the Trustee as to their rights and remedies under this Agreement,
and all costs and expenses (including, without limitation, reasonable counsel
fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement and the
documents to be delivered hereunder. In addition, the Seller agrees to pay any
and all stamp and other taxes and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of this Agreement
or the other documents to be delivered hereunder, and agrees to hold the
Purchaser harmless from and against any and all liabilities with respect to or
resulting from any delay in paying or omitting to pay such taxes and fees.

 

SECTION 7.6 No Bankruptcy Petition. Each of the Seller and the Purchaser
covenant and agree that prior to the date which is one year and one day after
the payment in full of all the Issuer Obligations neither party will institute
against, nor join any other Person in instituting against, the Purchaser or the
Seller, as applicable, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings, or other proceedings under any federal or state
bankruptcy or similar law. This Section 7.6 shall survive the termination of
this Agreement.

 

SECTION 7.7 Acknowledgment of Assignments. The Seller hereby acknowledges and
consents to the assignment by the Purchaser of the Receivables Trust Certificate
and the rights of the Purchaser under this Agreement to the Trustee pursuant to
the Indenture. The Seller further acknowledges that, in accordance with the
terms of the Transaction Documents and the Trustee may, under certain
circumstances exercise some or all of the rights of the Purchaser hereunder.

 

SECTION 7.8 Waiver of Setoff. All payments hereunder by the Seller to the
Purchaser or by the Purchaser to the Seller shall be made without setoff,
counterclaim or other defense and each of the Purchaser and the Seller hereby
waives any and all of its rights to assert any right of setoff, counterclaim or
other defense to the making of a payment due hereunder to the Seller or the
Purchaser, as the case may be; provided, however; that, notwithstanding the
foregoing, the Purchaser hereby reserves any and all of its rights to assert any
such right of setoff, counterclaim or other defense against the Seller with
respect to the Purchase Price of the Receivables Trust Certificate purchased
from the Seller hereunder in the ordinary course of the Purchaser’s business.

 

SECTION 7.9 Severability. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under such law, such provision shall be ineffective only to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.

 

SECTION 7.10 Counterparts. This Agreement and any amendment or supplement hereto
or any waiver granted in connection herewith may be executed in any number of
counterparts and by the different parties on separate counterparts and each such
counterpart shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same Agreement. Any signature (including,
without limitation, (x) any electronic symbol or

 

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process attached to, or associated with, a contract or other record and adopted
by a person with the intent to sign, authenticate or accept such contract or
record and (y) any facsimile or .pdf signature) hereto or to any other
certificate, agreement or document related to this transaction, and any contract
formation or record-keeping, in each case, through electronic means, shall have
the same legal validity and enforceability as a manually executed signature or
use of a paper-based record-keeping system to the fullest extent permitted by
applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any similar state law based on the Uniform Electronic Transactions Act, and
the parties hereto hereby waive any objection to the contrary. Each party hereto
shall be entitled to conclusively rely upon, and shall have no liability with
respect to, any faxed, scanned, or photocopied manual signature, or other
electronic signature, of any other party (whether such signature is with respect
to this Agreement or any notice, officer’s certificate or other ancillary
document delivered pursuant to or in connection with this Agreement) and shall
have no duty to investigate, confirm or otherwise verify the validity or
authenticity thereof.

 

SECTION 7.11 Jurisdiction; Consent to Service of Process.

 

(a)            The Seller and the Purchaser hereby submit to the nonexclusive
jurisdiction of any United States District Court for the Southern District of
New York and of any New York state court sitting in New York, New York for
purposes of all legal proceedings arising out of, or relating to, the
Transaction Documents or the transactions contemplated thereby. The Seller and
the Purchaser hereby irrevocably waive, to the fullest extent possible, any
objection it may now or hereafter have to the venue of any such proceeding and
any claim that any such proceeding has been brought in an inconvenient forum.
Nothing in this Section 7.11 shall affect the right of the Trustee or any
Noteholder to bring any action or proceeding against the Seller and the
Purchaser or its property in the courts of other jurisdictions.

 

(b)            TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HERETO
IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF, OR IN CONNECTION WITH, ANY TRANSACTION DOCUMENT OR
ANY MATTER ARISING THEREUNDER.

 

SECTION 7.12 Third Party Beneficiaries. Each of the Secured Parties shall be
third-party beneficiaries of this Agreement.

 

SECTION 7.13 Confirmation of Intent. It is the express intent of the parties
hereto that the sale to the Purchaser pursuant to Section 2.1 hereof of all of
the Seller’s right, title and interest, in, to and under the Receivables Trust
Certificate. However, if it is determined contrary to the express intent of the
parties that the transfer is not a sale and that all or any portion of the
assets described in Section 2.1(a) continue to be property of the Seller, then
the Seller hereby grants to the Purchaser a security interest in all of the
Seller’s right, title and interest in, to and under all such assets and this
Agreement shall constitute a security agreement under applicable law. The Seller
and the Purchaser shall, to the extent consistent with the Transaction
Documents, take such action as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the assets described in
Section 2.1(a), such interest would be deemed to be a perfected security
interest of first priority under applicable law and will be maintained as such
throughout the terms of this Agreement and the Indenture.

 

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SECTION 7.14 Section and Paragraph Headings. Section and paragraph headings used
in this Agreement are provided solely for convenience of reference and shall not
affect the meaning or interpretation of any provision of this Agreement.

 

SECTION 7.15 Interest. Without limitation to the express intent of the parties
set forth in the first sentence of Section 7.13, if the sales contemplated under
this Agreement are ever determined to constitute financing arrangements, the
parties hereto intend that Purchaser shall conform strictly to usury laws
applicable to it, if any. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law, if any, then, in that event,
notwithstanding anything to the contrary in this Agreement or any other
agreement entered into in connection with this Agreement, it is agreed as
follows: (i) the aggregate of all consideration which constitutes interest under
applicable law that is contracted for, taken, reserved, charged or received by
Purchaser under this Agreement or under any other agreement entered into in
connection with this Agreement shall under no circumstances exceed the Highest
Lawful Rate and any excess shall be canceled automatically and, if theretofore
paid, shall at the option of Purchaser be applied on the principal amount due
Purchaser or refunded by Purchaser to the Seller and (ii) in the event that the
maturity of any amount due is accelerated or in the event of any prepayment or
repurchase, then such consideration that constitutes interest under law
applicable to Purchaser, may never include more than the Highest Lawful Rate and
excess interest, if any, to Purchaser, provided for in this Agreement or
otherwise shall be canceled automatically as of the date of such acceleration,
prepayment or repurchase and, of theretofore paid, shall, at the option of
Purchaser be credited by Purchaser on the principal amount due to Purchaser or
refunded by Purchaser to the Seller. All sums paid or agreed to be paid to
Purchaser for the use, forbearance or detention of sums due hereunder shall, to
the extent permitted under applicable law, be amortized, prorated, allocated and
spread throughout the full term of the payments until payment in full so that
the rate or amount of interest or account of such payments does not exceed the
applicable usury ceiling.

 

[signature page follows]

 

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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
above written.

 

    CONN APPLIANCES RECEIVABLES FUNDING, LLC,
as Seller       By: /s/ George Bchara   Name: George Bchara   Title: Chief
Financial Officer         CONN’S RECEIVABLES FUNDING 2020-A, LLC,
as Purchaser       By: /s/ George Bchara   Name: George Bchara   Title: Chief
Financial Officer

 

 S-1Purchase and Sale Agreement