EXHIBIT 10.27


 


Marketing and Servicing Agreement
between Republic Bank & Trust Company and Advance America Cash Advance Centers of North Carolina, Inc.
(portions of the exhibit have been omitted pursuant to a request for
confidential treatment).


 


A mark of [***] in the text of this Exhibit indicates that
confidential material has been omitted.


 


This Exhibit, including the omitted portions, has been
filed separately with the Secretary of the Securities and Exchange Commission
pursuant to an application requesting confidential treatment under Rule 24b-2
of the Securities Exchange Act of 1934.


 


MARKETING
AND SERVICING AGREEMENT


 


This
Marketing and Servicing Agreement (this “Agreement”), dated as of the 12th day
of February, 2003, is by and between (i) Republic Bank & Trust Company, a
Kentucky state-chartered bank (“BANK”), and (ii) (a) Advance America, Cash
Advance Centers of North Carolina, Inc., a Delaware corporation (“AA”) and  (b) McKenzie Check Advance of North Carolina,
LLC d/b/a National Cash Advance, a Tennessee limited liability company (“NCA,”)
which shall hereinafter sometimes collectively be referred to as “ADVANCE
AMERICA”).


 


WHEREAS,
AA is a duly organized and validly existing Delaware corporation, authorized to
do business in the State of North Carolina;


 


WHEREAS,
NCA is a duly organized and validly existing Tennessee limited liability
company, authorized to do business in the State of North Carolina;


 


WHEREAS,
BANK is a Kentucky state-chartered bank insured by the Federal Deposit
Insurance Corporation and is authorized under applicable Kentucky and federal
law to engage in the transactions referred to herein;


 


WHEREAS,
BANK agrees that during the term of the Agreement BANK will deal exclusively,
with the possible exception of BANK’s existing relationship with [***] whereby BANK engages in TRANSACTIONS (as defined
below) with [***] in North Carolina, with
ADVANCE AMERICA with respect to TRANSACTIONS for all CUSTOMERS (as defined
below) located in the MARKET (as defined below);


 


WHEREAS,
ADVANCE AMERICA agrees that BANK shall have the first and exclusive right to
all TRANSACTIONS originated in the MARKET by ADVANCE AMERICA. The Parties agree
that BANk will contiue to fund all Transactions that are orignated by ADVANCE
AMERICA and meet the BANK’s stablished underwriting criteria until and unless
the BANK’s outstanding Transactions under this Agreement and any other
Marketing and Servicing Agreement with ADVANCE AMERICA equals [***] exclusive of Transactions rejected by BANK;


 


WHEREAS,
in accordance with its established underwriting and other criteria as may be
amended from time to time, BANK desires to engage in the TRANSACTIONS in
compliance with Kentucky Revised Statutes (“KRS”) Chapter § 368; and


 


WHEREAS,
ADVANCE AMERICA desires to market and service the TRANSACTIONS on BANK’s
behalf, while retaining authority and control over, and responsibility for, its
own employees and methods of operation.


 


NOW,
THEREFORE, in consideration of the foregoing and of the mutual promises
contained in this Agreement, and other valuable consideration, the sufficiency
of which is hereby acknowledged, and intending to be legally bound, BANK and
ADVANCE AMERICA (together, the “Parties”) agree as follows:


 


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1.                                         DEFINITIONS.


 


Terms
not specifically defined herein shall have the definitions ascribed to them
elsewhere in this Agreement.


 


(a)                                  “AA” shall mean Advance America, Cash Advance Centers
of North Carolina, Inc., a Delaware corporation.


 


(b)                                 “ADVANCE AMERICA” shall be defined individually and
collectively, jointly and severally, as AA and NCA.


 


(c)                                  “ADVANCE AMERICA INDEMNIFIED PARTIES” shall be defined
as AA, NCA and their parent, subsidiaries and affiliates, and each of their
officers, directors, shareholders, employees, representatives, agents and
attorneys.


 


(d)                                 “ADVERSE ACTION NOTICE” shall be defined as an
appropriately completed notice in compliance with Equal Credit Opportunity Act
(ECOA) Regulation B, and applicable law required to be provided to CUSTOMERS
who are not eligible for the PROGRAM.


 


(e)                                  “APPLICANT” shall be defined as a prospective CUSTOMER
seeking to take advantage of or otherwise participate in the PROGRAM.


 


(f)                                    “APPLICATIONS” shall be defined as each of the forms
filled out by a CUSTOMER seeking to take advantage of the PROGRAM as such forms
may be amended or modified from time to time.


 


(g)                                 “BANK” shall be defined as Republic Bank & Trust
Company, a Kentucky state-chartered bank.


 


(h)                                 “BANK DEPOSIT ACCOUNT” shall be defined as that bank
account held at a bank or banks designated by BANK and made known to ADVANCE
AMERICA and into which shall be deposited all the daily receipts collected by
ADVANCE AMERICA for the benefit of BANK and applied to the TRANSACTIONS.


 


(i)                                     “BANK INDEMNIFIED PARTIES” shall be defined as BANK
and its holding company, subsidiary and affiliates, and each of their officers,
directors, shareholders, employees, representatives, agents and attorneys.


 


(j)                                     “BANK INTELLECTUAL PROPERTIES” shall be defined as the
name, trade name, trademarks, service marks and logos of BANK.


 


(k)                                  “BANK POLICIES” shall be defined as the reasonable and
lawful practices, policies and procedures established by BANK and communicated
in writing to ADVANCE AMERICA from time to time with respect to the
TRANSACTIONS.


 


(l)                                     “CONFIDENTIAL INFORMATION” shall be defined as all
documents, materials and other information related to this Agreement which
shall have been obtained during the course of the negotiations leading to, and
during the performance of, this Agreement, excepting those items excluded from
this definition by Section 9(c) of this Agreement.


 


(m)                               “CUSTOMER” shall be defined as any person who participates in the PROGRAM.


 


(n)                                 “CUSTOMER INFORMATION” shall be defined as all
information derived from whatever source about any of the CUSTOMERS or the
APPLICANTS, including without limitation names, addresses, demographic
information and financial information.


 


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(o)                                 “DISCLOSURES” shall be defined as all information
required to be provided to an APPLICANT or CUSTOMER under federal law or
applicable state law.


 


(p)                                 “EFFECTIVE DATE” shall be the first business day
following delivery of written notice by ADVANCE AMERICA to BANK that the
PEOPLES AGREEMENT has been terminated.


 


(q)                                 “EVENT OF DEFAULT” shall be defined in Section 7(d).


 


(r)                                    “FEES” shall be defined as the marketing and servicing
fees set forth on Exhibit A attached hereto.


 


(s)                                  “HARMFUL ACTS” shall be defined as any fraud, theft,
dishonesty, defamation, or other willful misconduct of any party to this
Agreement, or any party’s officer, employee, director or agent.


 


(t)                                    “LOSSES” shall be defined as claims, losses,
liabilities, damages, penalties, demands, judgments, settlements, costs and
expenses, including reasonable attorneys’ fees.


 


(u)                                 “MARKET” shall mean all ADVANCE AMERICA stores in
North Carolina during the term of this Agreement.


 


(v)                                 “NCA” shall mean McKenzie Check Advance of North
Carolina, LLC (dba National Cash Advance), a Tennessee limited liability
company.


 


(w)                               “NET CHARGE OFFS” shall mean the difference between the sum of the
principal and FEES of any TRANSACTIONS which have been charged off less any
recoveries, payments or collections on such TRANSACTIONS.


 


(x)                                   “NOTES” shall be defined as those promissory notes or
similar negotiable instruments which may be made by a CUSTOMER to secure the
CUSTOMER’S obligations under any TRANSACTION.


 


(y)                                 “NSF CHARGE OFFS” shall be defined as items for which
payment has not been received in a [***] period
from the date such items are recorded by ADVANCE AMERICA which date shall be
within a reasonable time from the date the drawee bank notifies ADVANCE AMERICA
that such items are uncollected.


 


(z)                                   “PEOPLES AGREEMENT” shall mean those certain Marketing
and Servicing Agreements presently in effect between ADVANCE AMERICA and
PEOPLES NATIONAL BANK dated as of September 11, 2001.


 


(aa)                            “PROGRAM” shall be defined as the totality of the TRANSACTIONS
contemplated under this Agreement with regard to the deferred deposit
transactions.


 


(bb)                          “PROMOTIONAL MATERIALS” shall be defined as all letters, advertising and
promotional literature or material incorporating BANK INTELLECTUAL PROPERTIES
and all related designs, artwork, logos, slogans, copy and other similar
materials.


 


(cc)                            “REPAYMENT CHECKS” shall be defined as checks issued by a CUSTOMER as
security for and in repayment of the TRANSACTIONS.


 


(dd)                          “RESTRICTED PARTY” shall be defined as any party who is bound by Section 9
of this Agreement with regard to the CONFIDENTIAL INFORMATION, including,
without limitation, all agents, employees, officers, directors and other
third-party agents of any of the Parties hereto.


 


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(ee)                            “ROLLOVER” shall be defined as extending a TRANSACTION for an additional
term by paying only the fee due and refinancing the remaining principal amount
of the TRANSACTION for an additional fee.


 


(ff)                                “TRANSACTIONS” shall be defined as those certain deferred deposit
transactions as provided under Kentucky and other applicable law.


 


(gg)                          “TRANSACTION DOCUMENTS” shall be defined as (i) all original APPLICATIONS
and copies of all ADVERSE ACTION NOTICES and other documents relating to
rejected APPLICATIONS; and (ii)  originals or copies, as applicable, of
all APPLICATIONS, NOTES (including DISCLOSURES), REPAYMENT CHECKS and other
documents provided to or received from CUSTOMERS.


 


(hh)                          “TRANSACTION LOSS RATE” shall have the meaning set forth in Exhibit A.


 


2.                                       INCORPORATION OF RECITALS.


 


The
recitals set forth above are incorporated herein by reference.


 


3.                                       CONDITION TO EFFECTIVENESS OF AGREEMENT.


 


The
Parties acknowledge and agree that it is an express condition to the
effectiveness of this Agreement that the PEOPLES AGREEMENT shall have been
terminated, and that this Agreement shall not become effective unless and until
the PEOPLES AGREEMENT shall have been terminated. Immediately upon termination
of the PEOPLES AGREEMENT, ADVANCE AMERICA will deliver to BANK written notice
that such termination has occurred. In no event shall ADVANCE AMERICA deliver
said written notice later than February 28, 2003.


 


4.                                       BANK’S SERVICES.


 


(a)                                  BANK in its sole discretion shall determine all of the
conditions, terms and features of the TRANSACTIONS, including, without
limitation, amounts, fees and charges, limits, credit standards, underwriting
criteria, payment terms and all other terms and conditions of the
TRANSACTIONS.  BANK shall approve the
form of all TRANSACTION DOCUMENTS.  BANK
shall enter into the TRANSACTIONS with all APPLICANTS originated by ADVANCE
AMERICA and who, in the sole discretion of BANK, meet such standards and other
qualifications as established by BANK; provided that
BANK shall not be required to enter into a TRANSACTION if it reasonably
believes that the TRANSACTION or its solicitation will violate or has violated
any applicable law.  Neither ADVANCE
AMERICA, nor BANK, nor their respective employees shall state or suggest to
APPLICANTS that TRANSACTIONS are made with or approved by ADVANCE AMERICA or
that ADVANCE AMERICA (or any employee or agent of ADVANCE AMERICA) can improve
or otherwise influence an APPLICANT’s prospect of entering into a TRANSACTION
with BANK.  Subject to BANK policy and
applicable law, BANK may reject any TRANSACTION or TRANSACTIONS, at any time,
in its sole discretion.


 


(b)                                 ADVANCE AMERICA acknowledges that all rights of
ownership in the TRANSACTIONS and the TRANSACTION DOCUMENTS are and remain the
sole property of BANK, and ADVANCE AMERICA shall have no ownership rights to
such TRANSACTIONS or TRANSACTION DOCUMENTS during the term of this
Agreement.  Furthermore, ADVANCE AMERICA
shall not in any way fund, or purchase any share or “participation interest”
in, any TRANSACTION.


 


(c)                                  In its sole discretion, BANK may sell, transfer, grant
an interest in, or otherwise assign any TRANSACTION, or any portion of any
TRANSACTION, to a third party or parties provided that BANK shall not sell any
TRANSACTION to any business or entity whose primary business is conducting or 


 


4





















 


generating deferred deposit transactions.  Any sale, transfer or assignment by BANK of
any such TRANSACTION shall comply with applicable law.


 


(f)                                    BANK shall forward to ADVANCE AMERICA, via facsimile,
with a copy by first-class mail, within one (1) business day of receipt any
written notices it receives that bankruptcy proceedings have been initiated
with respect to any CUSTOMER.


 


(g)                                 During the term of this Agreement, BANK shall promptly
provide to ADVANCE AMERICA or its agents the data submission and reports
necessary for ADVANCE AMERICA to maintain effective internal controls and to
monitor results under this Agreement, including without limitation the
performance of the TRANSACTIONS and BANK’s obligations hereunder.


 


5.                                       ADVANCE AMERICA’s SERVICES.


 


(a)                                  General Duties of ADVANCE AMERICA; Standards of
Performance:  ADVANCE AMERICA shall perform all services
reasonably required to market and service the TRANSACTIONS of BANK in the
MARKET, including without limitation, the establishment of retail outlets in
number and location determined by ADVANCE AMERICA in its sole discretion, where
APPLICANTS may submit APPLICATIONS and receive DISCLOSURES required by
applicable law and where CUSTOMERS may execute and deliver the TRANSACTION
DOCUMENTS and deliver REPAYMENT CHECKS or other payment on the TRANSACTIONS for
deposit by ADVANCE AMERICA to BANK DEPOSIT ACCOUNT.  In marketing the TRANSACTIONS and performing
its services hereunder, ADVANCE AMERICA shall at all times and in all respects
comply with applicable laws, rules and regulations.  ADVANCE AMERICA agrees to conduct such
TRANSACTIONS in accordance with Exhibit B attached hereto and incorporated
herein by reference and shall comply with BANK’S PROGRAM and protocols
contemplated hereby.  Further, ADVANCE AMERICA
shall use only TRANSACTION DOCUMENTS approved by BANK and shall follow BANK
POLICIES.  ADVANCE AMERICA shall train
and supervise its employees to act in conformity with BANK POLICIES and the
requirements of applicable laws, rules and regulations.


 


(b)                                 Marketing of TRANSACTIONS:


 


(i)                                     BANK hereby authorizes ADVANCE AMERICA during the term
of this Agreement to market TRANSACTIONS to prospective CUSTOMERS on BANK’s
behalf.  BANK hereby grants to ADVANCE
AMERICA the right to use BANK INTELLECTUAL PROPERTIES during the term of this
Agreement in connection with this Agreement on letters, print advertisements,
the Internet, television and radio communications and other advertising and
PROMOTIONAL MATERIALS; provided, however,
ADVANCE AMERICA shall submit all PROMOTIONAL MATERIALS to BANK for its written
approval prior to any use thereof.  If
BANK fails to reject any proposed PROMOTIONAL MATERIALS within five (5)
business days of receipt of the request for approval, such PROMOTIONAL
MATERIALS shall be deemed approved by BANK. 
All rights to BANK INTELLECTUAL PROPERTIES not expressly granted to
ADVANCE AMERICA herein are reserved by BANK. 
Regardless of whether they incorporate BANK INTELLECTUAL PROPERTIES, all
advertising and PROMOTIONAL MATERIALS for the TRANSACTIONS (A) shall
prominently identify BANK as maker of the TRANSACTIONS, (B) shall be
accurate, (C) shall not be misleading, and (D) shall comply with all
applicable laws, rules and regulations.


 


(ii)                                  In connection with ADVANCE AMERICA’s performance of its
obligations under this Agreement, it is expressly agreed that (A) BANK
shall not hold any ownership or leasehold interest in any ADVANCE AMERICA store
or any personal property located therein, except for REPAYMENT CHECKS, NOTES,
TRANSACTION DOCUMENTS, and cash reflecting TRANSACTION repayments for the
TRANSACTIONS, and (B) no BANK employees shall work in any ADVANCE AMERICA
store except for BANK agents who may examine ADVANCE AMERICA stores from time
to time, during regular business hours, for compliance with BANK POLICIES and
other aspects of this Agreement.


 


(c)                                  Servicing of TRANSACTIONS and APPLICATIONS:


 


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(i)                                     BANK also hereby authorizes ADVANCE AMERICA to obtain
APPLICATIONS for TRANSACTIONS from APPLICANTS, using an APPLICATION approved by
BANK.  ADVANCE AMERICA shall make
APPLICATIONS available to prospective APPLICANTS and shall not discourage any
prospective APPLICANT from submitting an APPLICATION and shall provide
reasonable assistance to each prospective APPLICANT in completing an
APPLICATION.  ADVANCE AMERICA shall not
discriminate against or discourage any APPLICANT in any aspect of the
application process on any “prohibited basis,” as such term is defined in the
Equal Credit Opportunity Act (ECOA), Regulation B and KRS Section 344.400.


 


(ii)                                  Based upon the information provided by APPLICANTS to
BANK in the APPLICATIONS and such other credit-related information as obtained
by ADVANCE AMERICA at the direction of BANK, or by BANK directly, and pursuant
to the underwriting standards and criteria adopted by BANK in its sole
discretion, BANK shall be solely responsible for determining whether to enter
into a TRANSACTION with an APPLICANT. 
BANK shall, either itself or through its designated agent, communicate
to ADVANCE AMERICA its decision on each APPLICATION.  On BANK’s behalf, ADVANCE AMERICA shall
provide an ADVERSE ACTION NOTICE to any APPLICANT whose APPLICATION is rejected
by BANK.


 


(iii)                               The CUSTOMER’S obligations under the TRANSACTION shall be evidenced by a
NOTE containing the DISCLOSURES and secured by a REPAYMENT CHECK.


 


(iv)                              ADVANCE AMERICA shall (A) obtain from the CUSTOMER the executed NOTE; (B)
deliver an executed copy of the NOTE to the CUSTOMER; (C) obtain from the
CUSTOMER his or her REPAYMENT CHECK, dated the due date of the NOTE and made
payable to BANK for the Total of Payments set forth in the NOTE and held in
trust separate and apart from ADVANCE AMERICA’s records;  and (D) shall not allow CUSTOMERS to engage
in ROLLOVERS or to renew a TRANSACTION made pursuant to this Agreement except
to the extent permitted by applicable law and BANK POLICIES.


 


(d)                                 Collection of TRANSACTIONS.


 


(i)                                     BANK hereby authorizes ADVANCE AMERICA to service the
TRANSACTIONS by, among other things, (1) using its commercially reasonable
efforts to collect payments on the TRANSACTIONS at and after maturity thereof
on behalf of BANK (said collection efforts will include, but shall not be
limited to, the representment of checks via the Automated Clearing House (ACH));
(2) accurately recording and reporting payments of funds received from
CUSTOMERS, which payments shall be kept in a cash drawer, separate in all
respects from any cash or other assets of ADVANCE AMERICA; and (3) making
prompt remittance to and settlement with BANK by daily deposits of the CUSTOMER
funds in said cash drawer.  In collecting
payments owed under the NOTES, ADVANCE AMERICA shall comply in all respects
with applicable law, rules and regulations. 
Without limiting the generality of the foregoing, ADVANCE AMERICA shall
not, explicitly or implicitly, make any threats of criminal prosecution in
connection with debt collection, or otherwise engage in any collection
practices that violate any applicable law, rules and regulations; including
without limitation, but only where applicable, the Fair Debt Collection
Practices Act (“FDCPA”); any debt collection regulations or consumer protection
laws applicable to BANK or ADVANCE AMERICA; and the Best Practices of the
Community Financial Services Association of America (the “CFSA Best Practices”).


 


(ii)                                  ADVANCE AMERICA shall service the TRANSACTIONS at all
times in accordance with the terms of the NOTES and the DISCLOSURES, the
TRANSACTION DOCUMENTS and BANK POLICIES. 
BANK shall notify ADVANCE AMERICA in writing at least thirty (30) days
prior to any change in BANK POLICIES, unless such changes are required sooner
by applicable law.


 


(iii)                               On each day ADVANCE AMERICA operates its stores for regular business,
ADVANCE AMERICA shall deposit and transfer to BANK DEPOSIT ACCOUNT (A) all
cash received from CUSTOMERS representing repayment of TRANSACTIONS and
(B) all REPAYMENT 


 


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CHECKS held by ADVANCE AMERICA with respect to
TRANSACTIONS as to which repayment was not otherwise received on or before the
due date, subject to such delay in deposit, as ADVANCE AMERICA may reasonably
accommodate to secure repayment in cash from the CUSTOMER. However, in no event
shall ADVANCE AMERICA hold a check more than ten (10) days past the due date.


 


(iv)                              ADVANCE AMERICA shall be responsible for any deficiency in the amount of
cash reported and the actual amount of cash received from CUSTOMERS in
repayment of TRANSACTIONS. Any deficiencies shall be refunded to BANK on a
quarterly basis.


 


(v)                                 Files and boxes containing TRANSACTION DOCUMENTS shall
be clearly marked “Property of Rupblic Bank and Trust Company. Do not Destory.”


 


(e)                                  Reports; Access to Stores, Books and Records and
Employees:


 


(i)                                     During the term of this Agreement, ADVANCE AMERICA
shall promptly provide to BANK or its agents the data submissions and reports
set forth on Exhibit B hereto in order for BANK to maintain effective internal
controls and to monitor results under this Agreement, including without
limitation the performance of the TRANSACTIONS and ADVANCE AMERICA’s
obligations hereunder.


 


(ii)                                  ADVANCE AMERICA shall, as reasonably required by BANK,
but no more often than quarterly, provide BANK with its most recent unaudited
financial statements and its annual audited financial statements.


 


(iii)                               BANK agrees to allow ADVANCE AMERICA, as its agent and bailee, without an
ownership interest by ADVANCE AMERICA, to maintain and retain possession of the
TRANSACTION DOCUMENTS for the term of the Agreement and any additional period
required by applicable law.  Except as
otherwise allowed by Section 9 of this Agreement, ADVANCE AMERICA agrees to use
such TRANSACTION DOCUMENTS solely to service the TRANSACTIONS and to segregate
all such TRANSACTION DOCUMENTS, and all document files and records which relate
to the services provided by ADVANCE AMERICA hereunder, from ADVANCE AMERICA’s
other files and records.


 


(iv)                              The TRANSACTION DOCUMENTS shall be held by ADVANCE AMERICA, pursuant to
BANK’S record retention requirements, as more particularly set forth in Exhibit
B attached hereto and incorporated herein by reference in trust for BANK, and
BANK will have and shall continue to have constructive possession and legal
title to such documents, files and records. 
At such time or times as BANK may reasonably request, and at BANK’s
cost, ADVANCE AMERICA shall promptly deliver copies of requested TRANSACTION
DOCUMENTS to BANK at its headquarters or such other location or locations as
BANK shall direct.  All such documents
shall be maintained segregated from other books and records of ADVANCE AMERICA
and otherwise in such a manner as to facilitate their inspection by and
delivery to BANK, if so requested.


 


(v)                                 During the term of this Agreement and at all times
thereafter, BANK and banking agencies with regulatory authority over BANK shall
have reasonable access to ADVANCE AMERICA stores, to the books and records of
ADVANCE AMERICA (to the extent that such books and records pertain to the
TRANSACTIONS), to the officers, employees and accountants of ADVANCE AMERICA,
and to copies of TRANSACTION DOCUMENTS, all for the purpose of ensuring that
ADVANCE AMERICA is carrying out BANK POLICIES and is otherwise complying fully
with its obligations under this Agreement. 
Such access shall include permission to maintain employees on the
premises of ADVANCE AMERICA in North Carolina or such offices of ADVANCE
AMERICA where any information requested may be located  during regular business hours to audit
ADVANCE AMERICA’s services contemplated by this Agreement.  BANK agrees to provide reasonable advance
notice of its intent to audit any ADVANCE AMERICA store.


 


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(vi)                              In addition, and not as a limitation of the foregoing, BANK shall have the
right at ADVANCE AMERICA’s expense, provided that the aggregate expense to
ADVANCE AMERICA shall not exceed $15,000 per year, from time to time during the
term of this Agreement, to conduct reasonable outside audits in any given year
and other reasonable audits and/or compliance reviews of the services provided
hereunder, and the records generated thereunder; provided, that such audit and
review rights shall be conducted during normal business hours in a manner which
does not unreasonably interfere with ADVANCE AMERICA’s normal business
operations and CUSTOMER and employee relations.


 


(f)                                    FEES and Costs:  In consideration for ADVANCE
AMERICA’s performance of its obligations under this Agreement, BANK shall pay
ADVANCE AMERICA the FEES, as such FEES may be changed from time to time by
mutual written agreement of the Parties. Such FEES shall be paid by BANK to
ADVANCE AMERICA, as defined by, and containing the information required by
Exhibit A.  ADVANCE AMERICA will be
responsible for all costs, expenses and taxes (of whatever nature or authority)
associated with its stores and its services under this Agreement, including
without limitation rental and occupancy costs; costs of up-fit and leasehold
improvements; equipment costs; processing costs; printing costs; maintenance
costs; staffing costs; taxes assessed to or against ADVANCE AMERICA; signage
costs; and advertising costs.  Other than
the costs and expenses set forth in this section, ADVANCE AMERICA shall not be
responsible for any other costs or expenses associated with TRANSACTIONS,
provided, however, that each of the Parties hereto shall be responsible for
their own corporate and other expenses resulting from negotiating and executing
this Agreement.


 


6.                                       Representations and Warranties.


 


(a)                                  BANK hereby represents and warrants to ADVANCE AMERICA
as of the date hereof that:


 


(i)                                     BANK is a duly organized Kentucky state-chartered bank
validly existing under the laws of the Commonwealth of Kentucky, and is
authorized to conduct its business as described in this Agreement in the State
of North Carolina.  The deposits of BANK
are insured by the Federal Deposit Insurance Corporation up to applicable
limits.  BANK has the corporate power and
authority and all requisite licenses, permits and authorizations to execute and
deliver this Agreement and perform its obligations contemplated hereunder;


 


(ii)                                  BANK is authorized under applicable law to enter into
the TRANSACTIONS with CUSTOMERS in the MARKET in accordance with terms set
forth in KRS Chapter 368;


 


(iii)                               This Agreement has been duly authorized and will be
ratified by BANK’s Board of Directors at the next scheduled meeting of BANK’s
Board of Directors following execution hereof.


 


(iv)                              This Agreement has been duly executed and delivered by
BANK and constitutes its legal, valid and binding agreement, enforceable
against BANK in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship, and the rights and obligations of receivers and conservators under
12 U.S.C. §§1821 (d) and (e), and any other laws affecting creditors’ rights
and remedies generally;


 


(v)                                 The execution, delivery and performance of this
Agreement by BANK does not violate or conflict with (A) any provision of
the articles of incorporation or other governance documents of BANK; or
(B) any Kentucky or federal law, or (C) any order, arbitration award,
judgment or decree to which BANK is a party or by which BANK or any of its
assets may be bound;


 


(vi)                              BANK is authorized by applicable laws to contract with
a third party agent to provide the services that ADVANCE AMERICA will provide
under this Agreement;


 


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(vii)                           BANK is authorized under applicable laws to contract
with a third party to provide loan processing services not covered by this
Agreement, and represents that transmission by and between ADVANCE AMERICA and
such third party of information required for processing the TRANSACTIONS does
not violate any applicable state laws or federal law;


 


(viii)                        During the term of this Agreement, but only to the
extent permissible under applicable laws, regulations and regulatory practices,
ADVANCE AMERICA and its auditors shall have complete access to BANK’S
accounting records relating to TRANSACTIONS made in the MARKET. Subject to the
foregoing limitations, ADVANCE AMERICA will also have access to the officers,
employees and accountants of BANK for the same purposes as set forth above to
discuss such records and TRANSACTIONS during normal business hours and with
reasonable notice;


 


(ix)                                There are no undisclosed regulatory actions,
investigations, or lawsuits against BANK or its affiliates, relating to or
potentially impacting upon the marketing and servicing of TRANSACTIONS or the
performance of BANK’s obligations under this Agreement;


 


(x)                                   To the best of its knowledge, BANK represents that any
and all written information and financial statements provided to ADVANCE
AMERICA in contemplation of this Agreement did not contain any material
omissions of fact and were materially correct;


 


 


(xi)                                BANK is a current member of and in good standing with
the Community Financial Services Association of America (the “CFSA”); and


 


(xii)                             BANK shall use its reasonable best efforts to comply
in all material respects with the CFSA Best Practices in effect on the date of
this Agreement, and any reasonable Best Practices, or modifications to such
practices approved and adopted by the CFSA during the term of this Agreement;
provided the practices comply in all respects with all applicable law, and the
interpretation of such law by authorities with jurisdiction.


 


(xiii)                          BANK
will provide to ADVANCE AMERICA any information system examinations performed
and submit to ADVANCE AMERICA BANK’s disaster recovery plan at least annually.


 


(b)                                 ADVANCE AMERICA hereby represents and warrants to
BANK, as of the date hereof that:


 


(i)                                     AA is a duly organized and validly existing
corporation under the laws of the State of Delaware, and is duly qualified to
do business as contemplated under this Agreement and has all requisite
licenses, permits and authorizations under applicable state and federal law to
execute and deliver this Agreement and perform its obligations contemplated
hereunder;


 


(ii)                                  AA has the
corporate power and authority, and all requisite licenses, permits and
authorizations, to execute and deliver this Agreement and to perform
hereunder.  This Agreement has been duly
authorized by AA’s Board of Directors, has been executed and delivered by AA
and constitutes its legal, valid and binding agreement, enforceable against AA
in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization or other laws affecting creditors’
rights and remedies generally;


 


(vi)                              The execution, delivery and performance of this
Agreement by AA does not violate or conflict with (A) any provision of the
governance documents of AA; or (B) any applicable state or federal law; or
(C) any order, arbitration award, judgment or decree to which AA is a party or by
which AA or any of its assets may be bound;


 


9





















 


(vii)                           AA will operate its stores in North Carolina in
accordance with this Agreement and will follow its normal operating procedures
in operating these stores including providing adequate security measures,
hiring appropriate employees, and being open for business during normal
business operating hours;


 


(viii)                        There are no undisclosed regulatory actions,
investigations, or lawsuits against AA or its affiliates relating to the
marketing and servicing of the TRANSACTIONS in the MARKET;


 


(vi)                              To the best
of its knowledge, AA represents that any and all written financial statements
provided to BANK in contemplation of this Agreement did not contain any
material omissions of fact and were materially correct;


 


(vii)                           AA is a
current member of and in good standing with the CFSA; and


 


(viii)                        AA shall use
its reasonable best efforts to comply in all material respects with the CFSA
Best Practices in effect on the date of this Agreement, and any reasonable Best
Practices, or modifications to such practices approved and adopted by the CFSA
during the term of this Agreement; provided the practices comply in all
respects with all applicable law, and the interpretation of such law by authorities
with jurisdiction.


 


(ix)                                NCA is a duly organized and validly existing limited liability company
under the laws of the State of Tennessee, and is duly qualified to do business
as contemplated under this Agreement and has all requisite licenses, permits
and authorizations under applicable state and federal law to execute and
deliver this Agreement and perform its obligations contemplated hereunder;


 


(x)                                   NCA has the
power and authority, and all requisite licenses, permits and authorizations, to
execute and deliver this Agreement and to perform hereunder.  This Agreement has been duly authorized by
NCA’s Board of Directors, has been executed and delivered by NCA and
constitutes its legal, valid and binding agreement, enforceable against NCA in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization or other laws affecting creditors’
rights and remedies generally;


 


(xi)                              The
execution, delivery and performance of this Agreement by NCA does not violate
or conflict with (A) any provision of the governance documents of NCA; or
(B) any applicable state or federal law; or (C) any order, arbitration
award, judgment or decree to which NCA is a party or by which NCA or any of its
assets may be bound;


 


(xii)                           NCA will
operate its stores in North Carolina in accordance with this Agreement and will
follow its normal operating procedures in operating these stores including
providing adequate security measures, hiring appropriate employees, and being
open for business during normal business operating hours;


 


(xiii)                        There are
no undisclosed regulatory actions, investigations, or lawsuits against NCA or
its affiliates relating to the marketing and servicing of the TRANSACTIONS in
the MARKET;


 


(xiv)                         To the best
of its knowledge, NCA represents that any and all written financial statements
provided to BANK in contemplation of this Agreement did not contain any
material omissions of fact and were materially correct;


 


(xv)                            NCA is a
current member of and in good standing with the CFSA; and


 


10





















 


(xvi) NCA shall use its reasonable best efforts
to comply in all material respects with the CFSA Best Practices in effect on
the date of this Agreement, and any reasonable Best Practices, or modifications
to such practices approved and adopted by the CFSA during the term of this
Agreement; provided the practices comply in all respects with all applicable
law, and the interpretation of such law by authorities with jurisdiction.


 


(xvii)  On
a quarterly basis ADVANCE AMERICA will disclose all contingencies relating to
off-balance sheet guarantee arrangements and other significant events that may
affect ADVANCE AMERICA’s ability to perform under the Marketing and Servicing
Agreement.


 


(xviii)ADVANCE AMERICA shall conduct a SAS70
review and submit to Bank and submit to BANK ADVANCE AMERICA’s disaster
recovery plan at least annually.


 


7.                                       Indemnification; Insurance.


 


(a)                                  NCA
and AA, jointly and severally, hereby indemnify and agree to hold harmless BANK
INDEMNIFIED PARTIES from and against any and all LOSSES suffered or incurred by
BANK as a result of any HARMFUL ACTS committed by NCA and AA, jointly or
severally.


 


(b)                                 BANK hereby indemnifies and agrees to hold harmless
the ADVANCE AMERICA INDEMNIFIED PARTIES from and against any and all LOSSES
suffered or incurred by NCA and AA, jointly or severally, as a result of any
HARMFUL ACTS committed by BANK.


 


(c)                                  In addition to the above indemnification BANK hereby
indemnifies and agrees to hold harmless the ADVANCE AMERICA INDEMNIFIED PARTIES
from and against any and all losses suffered or incurred by any ADVANCE AMERICA
INDEMNIFIED PARTY as a result of placing data on BANK’s FTP site.


 


(d)                                 The fact that indemnification is provided in this
Agreement for some HARMFUL ACTS does not mean that statutory or common law
indemnification or contribution are not available to either party for other
acts not enumerated herein.


 


(e)                                  NCA and AA, jointly and severally,  agree to purchase and maintain general
business and liability insurance from a nationally-recognized insurance
provider which shall, at a minimum, include a rider or riders expressly
insuring NCA and AA, jointly and severally but naming BANK as an additional
insured or protected party against any insurable HARMFUL ACTS committed by NCA
and AA, jointly or severally and naming BANK as additional insured or loss
payee.  However, in no event shall BANK
be entitled to any insurance coverage over and above that available to NCA and
AA, jointly and severally.


 


(f)                                    The Parties agree that, if both BANK and either NCA or
AA or both are named as defendants in the same lawsuit, arbitration or other
proceeding, then Bank and either NCA or AA or both may enter into a Joint
Defense Agreement reasonably acceptable to Bank and either NCA or AA or both,
provided that any such Joint Defense Agreement shall not preclude any party
from asserting any counterclaim, cross-actions or third-party claims to which
it may be entitled.


 


(g)                                 Such Joint Defense Agreement shall include an
agreement that ADVANCE AMERICA shall have the right to choose acceptable
counsel and otherwise direct the litigation but any settlement of such claims
must be agreed to by BANK.  [***] The Parties agree to meet as soon as practicable but
no less than ten (10) business days following the date of the filing of any
claim, complaint or action to determine and agree upon the Joint Defense
Agreement. Any failure to agree upon the Joint Defense Agreement or any
provision of this Section 7 shall in no way affect or negatively impact any
Indemnified Parties’ right to indemnity.


 


(h)                                 [***]


 


11





















 


(i)                                     A party which may be entitled to be indemnified
pursuant to this Agreement (“Indemnified Party”) shall promptly notify the
party who may be liable for such indemnification (the “Indemnifying Party”) in
writing of any pending or threatened claim or demand which the Indemnified
Party has determined has given or could give rise to a right of indemnification
under this Agreement, within five (5) business days following the receipt of
any claim, complaint or filing of any action. Such written notice shall
describe in reasonable detail the facts and circumstances relating to such
claim or demand, and the activities or conduct giving rise to such claim or
demand, and the estimated Loss associated with such claim or demand.  The Parties agree that the failure to provide
such notice shall not release the Indemnifying Party from any of its
obligations under this Agreement except to the extent that the Indemnifying
Party is materially prejudiced by such failure.


 


(j)                                     The Indemnifying Party shall provide written
notification to the Indemnified Party as promptly as possible (but in any case
prior to the due date for the answer or response to a claim or demand)
confirming that the Indemnifying Party will indemnify the Indemnified Party
pursuant to the terms of this Agreement. 
The Indemnifying Party shall have the right to select and employ
competent, qualified counsel of its choice to defend any such claim or demand
asserted against the Indemnified Party. 
Counsel selected by the Indemnifying Party shall be reasonably
acceptable to the Indemnified Party.  The
Indemnified Party shall have the right to participate in the defense of any
such claim or demand at its own expense.


 


(k)                                  The Indemnified Party shall make available to the
Indemnifying Party and/or its agents and counsel all records and other
materials in the Indemnified Party’s possession reasonably required by the
Indemnifying Party for its use in defending such claim or demand asserted
against the Indemnified Party.


 


(l)                                     The Parties agree to cooperate in the defense of such
claim or demand and to furnish the necessary records, information and
testimony, and to attend such conferences, discovery proceedings, hearings,
trials and appeals, as may be reasonably requested in connection with such
claim or demand.


 


(m)                               Neither the Indemnified Party nor the Indemnifying Party shall settle or
compromise any claim or demand for which indemnity is sought under this
Agreement without the prior written consent of the other party, which should
not be unreasonably withheld or delayed.


 


8.                                       Term and Termination.


 


(a)                                  The term of this Agreement shall commence as of the
EFFECTIVE DATE of this Agreement, and shall automatically terminate three (3)
years after the EFFECTIVE DATE of this Agreement, provided however, that the
representations, covenants and warranties contained herein shall continue for a
period of three (3) years following such termination.


 


(b)                                 If the State of North Carolina enacts legislation
governing the TRANSACTIONS contemplated under this Agreement satisfactory to
ADVANCE AMERICA, then ADVANCE AMERICA may, in its sole discretion, upon thirty
(30) days prior written notice to BANK:


 


(i)                                     Require BANK to continue to engage in the TRANSACTIONS
according to the terms of this Agreement and, as requested by ADVANCE AMERICA,
pursuant to North Carolina law, in which instance ADVANCE AMERICA shall pay
BANK the difference, if any, between the sum BANK earns on [***] of each TRANSACTION, [***]; or


 


(ii)                                  Terminate this Agreement and execute with BANK a
Marketing and Servicing Agreement (the “Replacement Agreement”) for another
state, states or portions of states designated by ADVANCE AMERICA but
acceptable to BANK, which Replacement Agreement shall contain the same or
substantially similar terms, conditions and financial considerations as set
forth herein; or


 


12





















 


(iii)                               Engage in deferred deposit transactions in the State of North Carolina
independently of BANK, and pay [***] received
by CUSTOMERS from ADVANCE AMERICA between the date of termination and the
original expiration date of this Agreement.


 


(c)                                  If BANK terminates this Agreement without cause, which
shall be defined as any reason not specified in Section 7(a), (d), (f), (g),
(h), (i) or (j), and if following such termination ADVANCE AMERICA continues to
engage in deferred deposit transactions in the State of North Carolina either
independently or in partnership with another bank, BANK shall pay ADVANCE
AMERICA (i) all of its costs and expenses associated with such termination, the
costs of its transition to making deferred deposit transactions in its own name
and/or its replacement of BANK with another bank partner, including, but not
limited to, reasonable attorneys’ fees; and (ii) the difference, if any,
between (a) [***] received by the
CUSTOMER under each deferred deposit transaction between the date of
termination and the original expiration date of this Agreement and  (b) the actual fee earned by ADVANCE AMERICA
on such deferred deposit transactions. 
If ADVANCE AMERICA cannot continue to engage in deferred deposit
transactions in the State of North Carolina either independently or in
partnership with another bank following BANK’s termination of the Agreement
pursuant to Section 8(c), then BANK will pay ADVANCE AMERICA, for each month
between the date of termination and the original expiration date of this
Agreement, a sum equal to [***] of the
average monthly amounts received by the CUSTOMERS from BANK, ADVANCE AMERICA
and/or an ADVANCE AMERICA bank partner in North Carolina during the trailing [***]
prior to the date of termination.


 


(d)                                 This Agreement also may be terminated six (6) months
after the occurrence of one or more of the following events, unless a more
specific time period is set forth below (each, an “EVENT OF DEFAULT”):


 


(i)                                     if either party hereto shall be in material breach of
any representation or warranty or covenant hereunder; or


 


(ii)                                  by ADVANCE AMERICA, if BANK shall file for protection
under any state or federal liquidation provision, or if either party is placed
into conservatorship or receivership with the Federal Deposit Insurance
Corporation or any body or any other duly appointed person or entity having
jurisdiction over said party; or


 


(iii)                               by BANK, if ADVANCE AMERICA shall file for protection under any chapter of
the federal Bankruptcy Code, an involuntary petition is filed against ADVANCE
AMERICA under any such chapter and is not dismissed within thirty (30) days of
such filing, or a receiver or any regulatory authority takes control of ADVANCE
AMERICA.


 


(e)                                  Provided that ADVANCE AMERICA is not in material
breach of this Agreement, ADVANCE AMERICA may terminate this Agreement by
giving written notice at least thirty (30) days in advance of termination if:
(i) BANK ceases generally to fund TRANSACTIONS marketed by ADVANCE AMERICA, and
BANK does not resume funding such TRANSACTIONS within such thirty (30) day
notice period; (ii) any amendment to or change in the terms of KRS Chapter 368,
or other applicable law, has an adverse effect upon ADVANCE AMERICA; or (iii)
BANK amends BANK POLICIES and/or the PROGRAM in a way that causes a material
adverse effect upon ADVANCE AMERICA.


 


(f)                                    Provided that BANK is not in material breach of this
Agreement, BANK may terminate this Agreement by giving written notice at least
thirty (30) days in advance of termination if: (i) any amendment to or change
in the terms of KRS Chapter 368, or other applicable law, has an adverse effect
upon BANK or (ii) ADVANCE AMERICA amends its internal or operating policies in
a way that causes a material adverse effect upon BANK.


 


(g)                                 BANK may terminate this Agreement on thirty (30) days’
written notice to ADVANCE AMERICA in the event that the NET CHARGE OFFS exceed [***]
of the aggregate amount of FEES originated
through ADVANCE AMERICA in any calendar quarter; provided
such notice is given not later than thirty (30) days following the end of such
calendar quarter.


 


13





















 


(h)                                 In the event of an act of God or other natural
disaster which makes the carrying out of this Agreement impossible, or if a
party’s performance hereunder is rendered illegal or materially adversely
affected by reason of changes in law or regulations (either federal or state)
applicable to the TRANSACTIONS or to either party hereto, then either party may
terminate this Agreement upon thirty (30) days written notice unless an earlier
termination is mandated by a court of competent jurisdiction.


 


(i)                                     If a party is advised in writing by any regulatory
agency having or other body asserting jurisdiction over such party or the
TRANSACTIONS that the performance of that party’s obligations under this
Agreement is or may be unlawful or constitutes or may constitute an unsafe or
unsound banking practice or that such activity may jeopardize such party’s
standing with or applicable rating from such regulatory agency, then the party
unable to perform, or whose performance has been rendered illegal or who has
been so advised by a regulatory agency, may terminate this Agreement by giving
written notice at least six (6) months in advance of termination to the other
party, unless such changes in the laws or regulations or communication from
such regulatory agency require earlier termination, in which case termination
shall be effective upon such earlier required date.


 


(j)                                     Upon the occurrence and during the continuation of an
EVENT OF DEFAULT (as defined above in Section 8(d)) by either
party, the non-defaulting party may terminate this Agreement by giving written
notice at least thirty (30) days in advance of termination and an opportunity
for the defaulting party to cure the EVENT OF DEFAULT during such notice
period.


 


(k)                                  Upon termination or expiration of this Agreement, BANK
shall pay ADVANCE AMERICA any FEES that are then due and payable under this
Agreement.  In order to preserve the
goodwill of each party with its CUSTOMERS, both Parties shall act in good faith
in order to ensure a smooth and orderly termination of their relationship and
the termination of the TRANSACTIONS and marketing and servicing PROGRAM
contemplated hereunder.  Unless
prohibited by applicable law or as otherwise provided in this Agreement or
unless otherwise requested by BANK, ADVANCE AMERICA shall continue to service
outstanding TRANSACTIONS following termination or expiration of this Agreement
until all TRANSACTIONS are repaid or charged off in accordance with BANK
POLICIES.  Upon the termination or
expiration of this Agreement, all rights herein granted to ADVANCE AMERICA
(except those set forth in Section 9(a)) shall revert to BANK, and ADVANCE
AMERICA shall immediately cease using BANK INTELLECTUAL PROPERTIES.


 


(l)                                     If an EVENT OF DEFAULT has occurred and is continuing,
the non-defaulting party shall be entitled to pursue, either before or after
termination, such rights and remedies as may be available at law and in equity,
in addition to those rights and remedies specifically provided for under the
terms of this Agreement.


 


9.   Notices.


 


Any
notice hereunder by a party shall be given to the other party at its address
set forth below or at such other address designated by notice in the manner
provided in this Section 9, by personal delivery, certified mail or
private courier service, or by facsimile with a confirmation copy by first
class mail, postage prepaid.  Any written
notice or demand to be given under this Agreement shall be duly and properly
given if delivered as described in this Section 9.  Such notice shall be deemed to have been
given (a) when received if by personal delivery or private courier
service, (b) when faxed if by facsimile, and (c) three (3) business
days after mailing, if sent by certified mail; provided, however, that any
notice given by a party changing its address for notice shall be deemed given
only upon actual receipt by the other party. 
Unless otherwise agreed, notice shall be sent to the contact persons at
the addresses or facsimile numbers, as the case may be, set forth below:


 


	
   

  	
  7If to ADVANCE AMERICA:

  
	
   

  	
   

  	
  Advance America, Cash Advance

  
	
   

  	
   

  	
  Centers of North Carolina, Inc.

  
	
   

  	
   

  	
  Attention:
  John T. Egeland, President

  
	
   

  	
   

  	
  S.
  Sterling Laney, III, Vice President and Counsel

  
				



 


14





















 


	
   

  	
   

  	
  135
  North Church Street

  
	
   

  	
   

  	
  Spartanburg,
  SC 29306

  
	
   

  	
   

  	
  Telephone:          (864)
  342-5877

  
	
   

  	
   

  	
  Facsimile:            (864)
  342-5920

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  McKenzie
  Check Advance of

  
	
   

  	
   

  	
  North    Carolina,
  LLC.

  
	
   

  	
   

  	
  Attention:
  John T. Egeland, President

  
	
   

  	
   

  	
  S.
  Sterling Laney, III, Vice President and Counsel

  
	
   

  	
   

  	
  135
  North Church Street

  
	
   

  	
   

  	
  Spartanburg,
  SC 29306

  
	
   

  	
  Telephone:

  	
   

  	
  (864)
  342-5877

  
	
   

  	
  Facsimile:

  	
   

  	
  (864)
  342-5920

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  Robert
  M. Buell, Esq.

  
	
   

  	
   

  	
  Bowman
  and Brooke LLP

  
	
   

  	
   

  	
  Riverfront
  Plaza West Tower

  
	
   

  	
   

  	
  901
  East Byrd Street

  
	
   

  	
   

  	
  Suite
  1500

  
	
   

  	
   

  	
  Richmond,
  Virginia 23219

  
	
   

  	
  Telephone:

  	
   

  	
  (804)
  819-1109

  
	
   

  	
  Facsimile:

  	
   

  	
  (804)
  649-1762

  
	
   

  	
   

  	
   

  
	
  If to
  BANK:

  	
   

  	
  Michael
  Ringswald, Esq.

  
	
   

  	
   

  	
  Republic
  Bank & Trust Company

  
	
   

  	
   

  	
  One
  Republic Corporate Center

  
	
   

  	
   

  	
  601 W.
  Market Street

  
	
   

  	
   

  	
  Louisville,
  Kentucky 40202

  
	
   

  	
  Telephone:

  	
   

  	
  (502)
  561-7112

  
	
   

  	
  Facsimile:

  	
   

  	
  (502)
  561-7188

  
	
   

  	
   

  	
   

  
	
  with a
  copy to:

  	
   

  	
  Donald
  L. Cox, Esq.

  
	
   

  	
   

  	
  Lynch,
  Cox, Gilman & Mahan, P.S.C.

  
	
   

  	
   

  	
  400
  West Market Street

  
	
   

  	
   

  	
  Suite
  2200

  
	
   

  	
   

  	
  Louisville,
  Kentucky 40202

  
	
   

  	
  Telephone:

  	
   

  	
  (502)
  589-4215

  
	
   

  	
  Facsimile:

  	
   

  	
  (502)
  589-4994

  
						



 


10.                                 Confidentiality and Use of CUSTOMER Information.


 


(a)                                  All CUSTOMER INFORMATION shall be the sole property of
BANK.  Subject to the Gramm Leach Bliley
Act and any rules or regulations promulgated thereunder, BANK hereby grants to
ADVANCE AMERICA a worldwide, exclusive license in perpetuity (and specifically
surviving any termination of this Agreement) to use the CUSTOMER INFORMATION
for advertising and solicitations for any deferred deposit product or those
products substantially similar to the deferred deposit product contemplated
herein; provided that ADVANCE AMERICA shall not
use the CUSTOMER INFORMATION (i) if the CUSTOMER at issue advises BANK or
ADVANCE AMERICA that it does not wish such information to be so used, or
(ii) if its use would violate any federal or state statutes, laws and/or
regulations. ADVANCE AMERICA may use its computer system to capture, maintain
and process CUSTOMER INFORMATION for the purposes allowed in this Agreement.


 


15





















 


(b)                                 BANK agrees not to target the CUSTOMERS for any
solicitation of any deferred deposit product (other than general solicitations
for products or services directed to the public at large), and not to provide
any CUSTOMER INFORMATION to any person or entity not a party to this Agreement,
whether for purposes of soliciting any CUSTOMER for any product or otherwise,
except to the extent required to do so under applicable law or judicial,
administrative or regulatory process, without the prior written consent of
ADVANCE AMERICA.  BANK shall use
reasonable care to ensure that its agents do not violate this provision.


 


(c)                                  BANK and ADVANCE AMERICA agree to treat in confidence
the provisions of this Agreement and the CONFIDENTIAL INFORMATION, including
without limitation the reports referenced in Section 5(e), and not to
communicate CONFIDENTIAL INFORMATION to any third parties except that
CONFIDENTIAL INFORMATION may be provided to a regulatory agency having or
asserting jurisdiction over a party or the TRANSACTIONS, a party’s affiliates,
as such term is defined in the Securities Exchange Act of 1934, to counsel,
accountants, financial or tax advisors or persons conducting due diligence
reviews for a third party without the consent of the other party; provided that such Parties agree to hold such CONFIDENTIAL
INFORMATION in confidence.  As used
herein, the term “CONFIDENTIAL INFORMATION” does not include information which
(i) becomes generally available to the public other than as a result of a
disclosure by a RESTRICTED PARTY, (ii) is independently developed by a
RESTRICTED PARTY without violating this Agreement, (iii) was available to the
RESTRICTED PARTY on a non-confidential basis prior to its disclosure to the
RESTRICTED PARTY or (iv) becomes available to the RESTRICTED PARTY on a
non-confidential basis from a source other than the other Party; provided that
such source is not bound by a confidentiality agreement with the other Party or
otherwise prohibited from transmitting the information to the RESTRICTED PARTY
by a contractual, legal or fiduciary obligation.


 


(d)                                 In the event that a RESTRICTED PARTY is
requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, Civil Investigative Demand or similar
process) to disclose any CONFIDENTIAL INFORMATION, the RESTRICTED PARTY will
provide the other party with written notice of such request(s) at the time of
receipt of such notice so that the other party may seek an appropriate
protective order or other appropriate remedy and/or waive the RESTRICTED PARTY’s
compliance with the provisions of this Agreement.  In the event that the other party does not
seek such a protective order or other remedy, or such protective order or other
remedy is not obtained, or the other party grants a waiver hereunder, the
RESTRICTED PARTY may furnish that portion (and only that portion) of the
CONFIDENTIAL INFORMATION which the RESTRICTED PARTY is legally compelled to
disclose and will exercise such efforts to obtain reasonable assurance that
confidential treatment will be accorded any CONFIDENTIAL INFORMATION so
furnished as a RESTRICTED PARTY would reasonably exercise in assuring the
confidentiality of any of its own CONFIDENTIAL INFORMATION.


 


11.                                 Specific Performance in the Event of Breach.


 


The Parties agree that monetary damages would not be
adequate compensation in the event of a breach by a RESTRICTED PARTY of its
obligations under Section 9 of this Agreement and, therefore, the Parties
agree that in the event of any such breach the RESTRICTED PARTY, in addition to
its other remedies available at law or in equity, shall be entitled to an order
requiring the RESTRICTED PARTY to specifically perform its obligations under
this Agreement or enjoining the RESTRICTED PARTY from breaching this Agreement,
and the RESTRICTED PARTY shall not plead in defense thereto that there would be
an adequate remedy at law.


 


12.                                 Miscellaneous


 


(a)                                  Neither the existence of this Agreement or any related
agreements, nor their execution, is intended to be, nor shall it be construed
to be, the formation of a partnership or joint venture between BANK and ADVANCE
AMERICA.  No employee of ADVANCE AMERICA
shall be deemed to be an employee of BANK, nor shall any employee of BANK be
deemed an employee of ADVANCE AMERICA. Each party to this Agreement shall be
deemed to be an independent contractor.


 


16





















 


(b)                                 This Agreement and any related agreements supersede
any prior negotiations, discussions or communications between BANK and ADVANCE
AMERICA and constitute the entire agreement of BANK and ADVANCE AMERICA with
respect to the subject matter hereof.


 


(c)                                  Failure of any party to insist, in one or more
instances, on performance by any other party in accordance with the terms and conditions
of this Agreement shall not be deemed a waiver or relinquishment of any right
granted hereunder or of the future performance of any such term or condition or
of any other term or condition of this Agreement unless and to the extent that
such waiver is in a writing signed by or on behalf of the party alleged to have
granted such waiver.


 


(d)                                 To the extent permissible by applicable law, the
Parties agree to promptly notify each other in the event either party becomes
aware of any threatened or actual investigation, regulatory action, allegation,
arbitration or lawsuit pertaining to the TRANSACTIONS or this Agreement or any
similar marketing and servicing agreement of third parties.


 


(e)                                  This
Agreement and the rights and duties described herein shall be governed by, and
interpreted in accordance with Federal law and to the extent applicable the
laws of the State of Delaware, except that the Arbitration provisions shall be
governed by the Federal Arbitration Act.


 


(f)                                    Except
for the provisions contained in Section (10), any controversy or claim arising
out of or relating to this Agreement, or the breach thereof, (“Disputed Matter”)
shall be settled by binding arbitration under the Federal Arbitration Act
pursuant to the provisions of this Section 12(f).  In the event of the occurrence of a Disputed
Matter, any party shall elect to have the Disputed Matter resolved by
arbitration at a mutually convenient location selected by the arbitrators,
according to the following procedure:


 


(i)                                     The
arbitration shall be held:  (A) In a
summary manner, i.e., on the basis that it shall not be necessary to observe or
carry out either the usual formalities or procedure required by any arbitration
act or rules of civil procedure, or the Commercial Arbitration Rules; and (B)
Immediately, and with a view of its being completed within ninety (90) days
after it is demanded, unless otherwise agreed to in writing by both Parties,
having particular regard to any urgency regarding the matter in issue.


 


(ii)                                  In
the event that a party requires that a Disputed Matter be arbitrated hereunder,
such party shall give written notice thereof to the other party, which notice
shall specify the dispute and the relief that the party requests at the
arbitration.  Upon the giving of such
notice, each party shall have fifteen (15) days in which to select one (1)
arbitrator and the two (2) selected arbitrators shall in turn choose a third
arbitrator.


 


(iii)                               The
third arbitrator shall be: (A) If the question in issue is primarily an
accounting matter, an independent certified public accountant; or (B) if the
question in issue is primarily a legal matter, a practicing lawyer of not less
than ten (10) years standing as such or a retired judge.  If the arbitrators chosen by the Parties
cannot agree on the choice of such accountant or lawyer within fourteen (14)
days of their appointment, such person is to be appointed in accordance with
rules and procedures of the American Arbitration Association.


 


(iv)                              Any
arbitration shall be conducted before said three (3) arbitrators pursuant to
the American Arbitration Association Commercial Arbitration Rules in force on
the effective date of this Agreement, as modified by the provisions of this
Section 12(f).  The panel shall render
its decision in writing in accordance with applicable substantive laws.  The panel shall have the right and power to
apportion the costs and expenses of the arbitration (including the Parties’
attorneys’ fees and expenses) in its discretion.


 


(v)                                 The
Parties irrevocably agree that the decision or award in any arbitration
proceedings hereunder:  (A) Shall be
binding on all of them, without any right of appeal except as provided by the
Federal Arbitration Act; (B) Shall forthwith be carried into effect; and (C)
May be made an order of any court of competent jurisdiction.


 


17





















 


(vi)                              It
is expressly agreed and understood by the Parties that, notwithstanding
anything to the contrary contained in this Section 12(f), the provisions hereof
will not deprive any party from any right or remedy available to it to obtain
preliminary or injunctive relief from a court of competent jurisdiction pending
the decision of the arbitrators.


 


(vii)                           The
provisions of this Section 12(f) shall continue to be binding on all Parties
notwithstanding any termination or cancellation of this Agreement.


 


(g)                                 ADVANCE
AMERICA shall not assign or delegate any of its rights and/or obligations
hereunder without BANK’s prior written consent, which consent shall not be
unreasonably withheld.  BANK shall not
assign any of its rights and/or obligations hereunder to any other party
without ADVANCE AMERICA’s prior written consent, which consent shall not be
unreasonably withheld.


(h)                                 This Agreement is for the sole and exclusive benefit
of the Parties and shall not be deemed to be for the benefit of any third
party, including any party to a TRANSACTION hereunder.


 


(i)                                     The headings of the several sections and subsections
of this Agreement are inserted for convenience only and shall not in any way
affect the meaning or construction of any provision of this Agreement.


 


(j)                                     This Agreement may be executed by the Parties in
separate counterparts, each of which is an original but all of which together
shall constitute one and the same document. 
Facsimile signatures and photocopies shall be deemed as valid as though
they were originals.


 


(k)                                  Modifications to this Agreement can only be made in
writing signed by all Parties.


 


(l)                                     This Agreement shall not become effective until the
EFFECTIVE DATE.


 


(m)                               EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY
JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS
AGREEMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS
OF THE PARTIES HERETO WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS
RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY ARBITRATION, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION IN ARBITRATION AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.


 


(n)                                 Should any provision of this Agreement be declared
illegal or unenforceable by any court or tribunal of competent jurisdiction and
cannot be modified to be enforceable, such provision shall immediately become
null and void, leaving the remainder of this Agreement in full force and
effect.


 


(o)                                 In the event of a conflict between any of the Exhibits
to this Agreement and this Agreement, the terms and conditions set forth in
this Agreement shall govern the relationship between the Parties hereto.


 


IN WITNESS WHEREOF, BANK
and ADVANCE AMERICA, intending to be legally bound hereby, have caused this
Agreement to be executed by their duly authorized officers as of the day and
year first set forth above.


 


	
  ADVANCE
  AMERICA, CASH ADVANCE CENTERS OF

  NORTH CAROLINA, INC. (“AA”)

  	
  REPUBLIC
  BANK & TRUST COMPANY (“BANK”)

  



 


18





















 


	
  By:

  	
    /s/
  William M. Webster, IV

  	
   

  	
  By:

  	
    /s/
  Bill Petter

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  William
  M. Webster, IV

  	
   

  	
   

  	
  Bill Petter

  	
   

  
	
   

  	
   

  
	
  Its:

  	
  Chief
  Executive Officer

  	
   

  	
  Its:

  	
  Executive
  Vice President

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
      2/12/03

  	
   

  
										



 


 


	
  MCKENZIE CHECK ADVANCE OF NORTH
  CAROLINA,

  LLC (D/B/A NATIONAL CASH ADVANCE)

  
	
  (“NCA”)

  
	
   

  
	
   

  
	
  By:

  	
  : /s/
  William M. Webster, IV

  	
   

  
	
   

  
	
  William M. Webster, IV

  
	
   

  
	
  Its:
  Chief Executive Officer

  
	
   

  
	
  Date:

  	
   

  	
   

  
				



 


19





















 


EXHIBIT A


 


COMPUTATION OF MARKETING AND SERVICING FEES


 


1.               This is Exhibit A
to that certain Marketing and Servicing Agreement dated as of February 12, 2003
(the “Agreement”) between (i) (a) REPUBLIC BANK & TRUST COMPANY  (“BANK”), and (ii) Advance America, Cash
Advance Centers of North Carolina, Inc. (“AA”) and (b) McKenzie Check Advance
of North Carolina, LLC (d/b/a National Cash Advance) (“NCA,” which together
with AA shall hereinafter sometimes be collectively referred to as “ADVANCE
AMERICA”).  All capitalized terms used
herein and not otherwise defined are defined in the Agreement.


 


2.               As ADVANCE AMERICA’s
sole compensation under the Agreement, BANK shall pay ADVANCE AMERICA the
marketing and servicing fees (“FEES”) set forth below.  BANK shall only be obligated to pay the FEES
on TRANSACTIONS, or portions thereof, collected during the term of this
Agreement.


 


3.               Commencing on the
first (1st) business day following the EFFECTIVE DATE of this
Agreement and continuing on each business day thereafter, ADVANCE AMERICA shall
deliver to BANK a daily report of business outlining the total amount advanced
to each CUSTOMER, total fees and the total TRANSACTIONS held as
receivable.  Additionally, the report
will detail the TRANSACTIONS collected from each CUSTOMER together with the
applicable fees that pertain to BANK and applicable FEES owed by BANK to
ADVANCE AMERICA, as well as such other information as is reasonably required by
BANK to manage the PROGRAM.


 


4.               On or about the
first (1st) and sixteenth (16th) calendar day of each
calendar month following a TRANSACTION repayment and continuing on or about the
first (1st) and sixteenth (16th) calendar day of each
calendar month thereafter, ADVANCE AMERICA shall deliver to BANK an invoice,
detailing by the day, the total TRANSACTIONS, the total fees earned by BANK and
the total amount of FEES due to ADVANCE AMERICA for the period included in such
invoice (an “Invoice”).  Based on those
Invoices, BANK will pay to ADVANCE AMERICA by Automated Clearing House (ACH)
transfer (or by other means agreeable to ADVANCE AMERICA and BANK) the day
following the delivery of each Invoice, the FEES to be paid by BANK hereunder
related to ADVANCE AMERICA’s activities for the Invoice period; provided that
if any payment date is not a business day for BANK, the payment shall be made
on the next business day for which BANK is open.  Each Invoice shall show (i) the Total of
Payments on TRANSACTIONS actually received by BANK during the Invoice period,
and (ii) the FEES owed by BANK to ADVANCE AMERICA, together with the
calculation thereof in the same detail as in the sample calculation attached
hereto as Exhibit A-1. ADVANCE AMERICA and BANK agree that the calculation of
the FEES owed by BANK shall be submitted with each of the foregoing Invoices
and performed strictly in accordance with the sample calculation attached.  ADVANCE AMERICA and BANK also agree that, for
purposes of performing such calculation, the following assumptions apply:


 


(a) The term “TRANSACTION LOSS RATE” shall be a
percentage which is equal to [***].


 


(b) Each Borrower shall be charged a fee up [***] of
the face amount of each deferred deposit transaction for each [***],  which fee may be modified from time to time
upon agreement by ADVANCE AMERICA and BANK and allowed by applicable law.


 


(c)  Upon
collection of a TRANSACTION, BANK shall pay to ADVANCE AMERICA a fee equal to
[***] received by the CUSTOMER for each deferred deposit transaction, which fee
may be modified from time to time upon agreement by ADVANCE AMERICA and BANK.


 


(d)  [***]


 


20





















 


EXHIBIT A-1


 


SAMPLE CALCULATION


 


MARKETING AND SERVICING
FEE


 


[***]


 


EXHIBIT B


 


 


	
  MATTER

  	
   

  	
  AGREEMENT

  	
   

  	
  PROCESS

  	
   

  	
  INFO
  SOURCE/PROCEDURE

  
	
  Calculation of
  marketing and servicing fees due Advance America (“AA”)

  	
   

  	
  Bank pays AA [***]
  advanced to the customer for marketing and servicing fees.

  	
   

  	
  AA submits an M&S
  invoice to Bank on a Semi Monthly basis. The invoicing periods are the 1st
  through the 15th and the 16th through the last day of
  the month. Invoices are issued within 3 business days after the invoice
  period. Bank remits payment for such invoice on the following business day.

  	
   

  	
  AA information services
  (IS) department generates a Daily Report of Business showing 1) Total
  amount of each customer transaction, 2) the fees earned, 3) the fees
  projected to be earned upon repayment of the deferred deposit transaction, 4)
  and the total checks held as receivable as a result of the transaction. An
  additional report is generated showing 1) Total amount collected from each
  customer, 2) total amount of the deposit to bank’s account, 3) fees due, and
  4) any other information that is reasonably required by BANK to manage the
  Transactions. Twice each month, AA accounting department generates a report
  summarizing the daily reports of business. This report serves as the invoice
  to Bank for fees due AA.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bad debt expense

  	
   

  	
  [***]

  	
   

  	
  Bad debt
  information/settlement is included in the semi monthly M&S invoice.

  	
   

  	
  [***]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Over and Short

  	
   

  	
  All over and short
  amounts are the responsibility of AA

  	
   

  	
  As discovered and
  reconciled

  	
   

  	
  Will be in report
  Analysis of Account Receivable – Bank and settled with the same report as
  late fees and petty cash.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Deposit Corrections

  	
   

  	
  All deposit corrections
  are the responsibility of AA

  	
   

  	
  As discovered and
  reconciled

  	
   

  	
  Deposit corrections are
  essentially the same as over/short amounts that are discovered by BANK. They
  will be settled with the same report as petty cash, and other over and short
  amounts.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cash bank check in AA
  center

  	
   

  	
  If lawful and agreed to
  by Bank and AA and at Bank’s direction, AA will cash the checks
  provided to customers in the center where the advance is made.

  	
   

  	
  If law permits and the
  branch has cash

  	
   

  	
  In order to help
  transition customers to BANK program, AA may cash the check. AA will take
  check back from the customer, endorsing it to BANK, giving the customer
  BANK’s cash, and depositing the check into BANK’s account.

  



 


21





















 


	
  Transition from current
  model to Bank Partnership.

  	
   

  	
   

  	
   

  	
  Daily

  	
   

  	
  On transition day, AA
  will switch from the existing bank account to BANK’s account, making all
  deposits into Bank’s account, and writing all customer disbursements on
  Bank’s account. From the daily report of business, AA will calculate the
  total checks redeemed by customers that pertain to transactions that occurred
  prior to BANK’s program and invoice BANK for such deposits, daily. Typically
  there will be a 2 day lag between the time the deposit is made and the time
  BANK receives the invoice.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total Outstanding

  	
   

  	
  Bank’s total aggregate
  outstanding of deferred deposit transactions on any date shall be equal to or
  less than [***]

  	
   

  	
  Daily

  	
   

  	
  AA will on a daily
  basis transmit to Bank sufficient information in a form acceptable to both
  parties which will allow Bank to determine the extent of their outstanding
  receivables. Based on this data Bank and AA will determine if the aggregate
  outstanding is approaching the limit and come to a mutually agreeable
  solution (e.g. Bank sells Transactions off to a third party as contemplated
  in the M&S, Bank is unable to sell-off or hold more than the [***] and
  removes themselves from North Carolina so that another bank can take its
  place) as to how to limit Bank’s aggregate outstanding or modify the maximum
  outstanding in writing.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Transmission of Data

  	
   

  	
  AA will transmit
  transaction data in a format as specified by Bank which will allow BANK to
  maintain a complete set of books and records of the transactions.

  	
   

  	
  Daily

  	
   

  	
  AA will on a daily
  basis transmit information in a file format specified by Bank which contains
  the transactions originated, paid, collected, charged-off, etc. which will
  allow Bank to maintain a complete set of books and records regarding the
  transactions. The file for each business day will be transmitted by the next
  business day.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Record Retention
  Requirements

  	
   

  	
  AA will maintain all
  applications, notes and adverse action notices for the required retention
  period

  	
   

  	
  Annually

  	
   

  	
  AA will maintain files
  on each Applicant whether accepted or rejected by Bank, which file shall
  include Applications, Notes, Adverse Actions, etc.

  



 


FIRST
AMENDMENT TO THE

MARKETING AND SERVICING AGREEMENT


 


THIS FIRST AMENDMENT TO THE MARKETING AND SERVICING
AGREEMENT is an addendum to the MARKETING AND SERVICING AGREEMENT dated
February 12, 2003 by and between Republic Bank & Trust Company, a bank
organized under the laws of the state of Kentucky (the “BANK”), and Advance
America, Cash Advance Centers of North Carolina, Inc., a Delaware Corporation (“AA”)
and McKenzie Check Advance of North Carolina, LLC d/b/a National Cash Advance,
a Tennessee limited liability company (“NCA”) which shall hereinafter sometimes
collectively be referred to as “ADVANCE AMERICA.”


 


Pursuant to Section 12 (k) of the Marketing and
Servicing Agreement, the BANK and ADVANCE AMERICA do hereby agree to amend the
Marketing and Servicing Agreement to read in its entirety as follows:


 


Page
13 Section 6(xiii) of the Marketing and Servicing Agreement shall be amended to
read as follows:


 


22





















 


(xiii)                    BANK will provide to ADVANCE
AMERICA any information system audits performed and will submit to ADVANCE
AMERICA BANK’s disaster recovery plan at least annually.


 


In the
event of any conflict, inconsistency, or incongruity between the provisions of
this First Amendment and any of the provisions of the Marketing and Servicing
Agreement, the provisions of the First Amendment shall in all respects govern and
control. ,


 


In
WITNESS WHEREOF, ADVANCE AMERICA and BANK, each intending to be legally bound
hereby, have caused this First Amendment to be executed by its duly authorized
officer as of the 21st day of March 2003.


 


	
  REPUBLIC BANK &
  TRUST COMPANY

  	
  ADVANCE AMERICA, CASH ADVANCE
  CENTERS OF NORTH CAROLINA, INC.

  
	
   

  	
   

  
	
  By:

  	
    /s/ Bill
  Peter

  	
   

  	
  By:

  	
    /s/ William
  Webster, IV

  	
   

  
	
   

  	
  Bill
  Petter

  	
   

  	
   

  	
  William
  M. Webster, IV

  
	
   

  	
   

  
	
  Its:

  	
    Executive
  Vice President

  	
   

  	
  Its:

  	
   Chief Executive
  Officer

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   3/21/03

  	
   

  	
  Date:

  	
    4/21/04

  	
   

  
											



 


SECOND
AMENDMENT TO THE

MARKETING AND SERVICING AGREEMENT


 


THIS SECOND AMENDMENT TO THE MARKETING AND SERVICING
AGREEMENT is an addendum to the MARKETING AND SERVICING AGREEMENT dated
February 12, 2003 by and between Republic Bank & Trust Company, a bank
organized under the laws of the state of Kentucky (the “Bank”), and Advance
America, Cash Advance Centers of North Carolina, Inc., a Delaware Corporation (“AA”)
and McKenzie Check Advance of North Carolina, LLC d/b/a National Cash Advance,
a Tennessee limited liability company (“NCA”), which shall hereinafter
sometimes collectively be referred to as “ADVANCE AMERICA.”


 


Pursuant to Section 12(k) of the Marketing and
Servicing Agreement, the BANK and ADVANCE AMERICA do hereby agree to amend the
Marketing and Servicing Agreement to read in its entirety as follows:


 


Effective September 2, 2003, McKenzie Check Advance of
North Carolina, LLC, shall merge into and be consolidated with Advance America,
Cash Advance Centers of North Carolina, Inc. Accordingly, effective September
2, 2003, any reference in the MARKETING AND SERVICING AGREEMENT to National
Cash Advance or McKenzie Check Advance of North Carolina, LLC, shall be deemed
to be referring to Advance America, Cash Advance Centers of North Carolina,
Inc.


 


In particular on Page 2, Section 1(b) of the Marketing and Servicing
Agreement, the definition quoted “ADVANCE AMERICA,” from September 2, 2003,
going forward shall be defined as AA.


 


The Representations and Warranties concerning NCA, beginning on Page 14
and continuing on to Page 15, shall be considered null and void and no longer
in effect as to NCA. However, effective September 2, 2003, AA shall assume all
applicable Representations and Warranties of NCA that pursuant to normal
interpretation will continue in full force and effect after September 2, 2003.


 


Page 8, Section 5(c)(ii) of the Marketing and Servicing Agreement shall
be amended to read as follows:


 


(ii)                                  Based upon the information provided by APPLICANTS to
BANK in the APPLICATIONS and such other credit-related information as obtained
by ADVANCE AMERICA at the direction of BANK, or by BANK directly, and pursuant
to the underwriting standards and criteria adopted by BANK in its sole
discretion, BANK shall be solely responsible for determining whether to enter
into a TRANSACTION with an APPLICANT. BANK shall, either itself or through its
designated agent, communicate to ADVANCE AMERICA its decision on each
APPLICATION. On 


 


23





















 


BANK’s behalf, ADVANCE AMERICA shall provide an ADVERSE ACTION NOTICE to
any APPLICANT whose APPLICATION is rejected by BANK. Additionally, on BANK’s
behalf, ADVANCE AMERICA shall provide each APPLICANT with a copy of BANK’s
privacy notice.


 


Page 10, Section 5(e)(iv) of the Marketing and Servicing Agreement
shall be amended to read as follows:


 


(iv)                              The TRANSACTION DOCUMENTS shall be held by ADVANCE AMERICA, pursuant to
BANK’s record retention requirements, as more particularly set forth in Exhibit
B attached hereto and incorporated herein by reference in trust for BANK, and
BANK will have and shall continue to have constructive possession and legal
title to such documents, files and records. At such time or times as BANK may
reasonably request, and at BANK’s cost, ADVANCE AMERICA shall promptly deliver
copies of requested TRANSACTION DOCUMENTS to BANK at its headquarters or such
other location or locations as BANK shall direct. All such documents shall be
maintained segregated from other books and records of ADVANCE AMERICA and
otherwise in such a manner as to facilitate their inspection by and delivery to
BANK, if so requested. ADVANCE AMERICA will maintain, through its policies,
procedures and practices, controls designed to safeguard the TRANSACTION
DOCUMENTS and related customer information as well as the confidentiality
thereof. TRANSACTION DOCUMENTS to BANK at its headquarters or such other
location or locations as BANK shall direct. In the event the security of the
TRANSACTION DOCUMENTS is breached or ADVANCE AMERICA learns of the unauthorized
use of information contained in the TRANSACTION DOCUMENTS, then ADVANCE AMERICA
shall promptly notify BANK of such breach or unauthorized use so that BANK
shall be able to take any and all appropriate and necessary action.


 


Page 10, Section 5(e)(v) of the Marketing and Servicing Agreement shall
be amended to read as follows:


 


(v)                                 During the term of this Agreement and at all times
thereafter, BANK and banking agencies with regulatory authority over BANK
including, but not limited to the FDIC and the Kentucky Department of Financial
Institutions shall have reasonable access to ADVANCE AMERICA stores, to the
books and records of ADVANCE AMERICA (to the extent that such books and records
pertain to the TRANSACTIONS), to the officers, employees and accountants of
ADVANCE AMERICA, and to copies of TRANSACTION DOCUMENTS, all for the purpose of
ensuring that ADVANCE AMERICA is carrying out BANK POLICIES and is otherwise
complying fully with its obligations under this Agreement as well as all
applicable laws and regulations. Such access shall include permission to
maintain employees on the premises of ADVANCE AMERICA in North Carolina or such
offices of ADVANCE AMERICA where any information requested may be located
during regular business hours in order to audit ADVANCE AMERICA’s services
contemplated by this Agreement and to conduct on-site transaction testing and
other operational reviews. BANK agrees to provide reasonable advance notice of
it or its banking agencies with regulatory authority over its intent to audit
any ADVANCE AMERICA store in North Carolina.


 


Page 11, Section 5(e)(vii) shall be added to the Marketing and
Servicing Agreement and shall read as follows:


 


(vii)                           ADVANCE AMERICA will address any and all customer complaints regarding the
TRANSACTIONS including any responsibility for forwarding such complaints to
appropriate third parties as well as any response thereto. Prior to addressing
or responding to any such customer complaint ADVANCE AMERICA will notify BANK
of the complaint as well as how it intends to handle and/or respond thereto.
Upon receiving BANK’s approval on its intended course of action ADVANCE AMERICA
will handle accordingly.


 


Page 11, Section 5(e)(viii) shall be added to the Marketing and
Servicing Agreement and shall read as follows:


 


(viii)                        ADVANCE AMERICA will collect customer identification (“CIP”) information
required by the USA Patriot Act §326 and provide customers with adequate notice
of the CIP requirements prior to opening an account. CIP information includes
name, physical address, date of birth, and taxpayer identification number or
other unexpired government-issued photo identification number that allows
ADVANCE AMERICA to form a reasonable belief of (i.e., verify) the CUSTOMER’s
true identity. Records containing the required CIP information will be
maintained by ADVANCE AMERICA for a period of five (5) years from the date the
CUSTOMER’s account is closed and will be retrievable within 72 hours of any
federal law enforcement agency’s request.


 


24





















 


In the event of any
conflict, inconsistency, or incongruity between the provisions of this Second
Amendment and any of the provisions of the Marketing and Servicing Agreement,
the provisions of the Second Amendment shall in all respects govern and
control.


 


IN WITNESS WHEREOF,
ADVANCE AMERICA and BANK, each intending to be legally bound hereby, have
caused this Second Amendment to be executed by its duly authorized officer as
of the      of September, 2003.


 


	
  REPUBLIC BANK &
  TRUST COMPANY

  	
   

  	
  ADVANCE AMERICA, CASH
  ADVANCE CENTERS OF NORTH CAROLINA, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
    /s/ Bill
  Petter

  	
   

  	
  By:

  	
     /s/
  William Webster, IV

  	
   

  
	
   

  	
  Bill
  Petter

  	
   

  	
   

  	
  William
  M. Webster, IV

  
	
   

  	
   

  	
   

  
	
  Its:

  	
    EVP

  	
   

  	
  Its:

  	
    Chief
  Executive Officer

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
    9/10/03

  	
   

  	
  Date:

  	
    9/10/03

  	
   

  
											



 


THIRD
AMENDMENT TO THE

MARKETING AND SERVICING AGREEMENT


 


THIS THIRD AMENDMENT TO THE MARKETING AND SERVICING
AGREEMENT is an addendum to the MARKETING AND SERVICING AGREEMENT dated
February 12, 2003, by and between Republic Bank & Trust Company, a bank
organized under the laws of the Commonwealth of Kentucky (the “Bank”) and
Advance America, Cash Advance Centers of North Carolina, Inc., a Delaware
corporation (“Advance America”).


 


Pursuant to Section 12(k) of the Marketing and
Servicing Agreement, the BANK and ADVANCE AMERICA do hereby agree to amend the
Marketing and Servicing Agreement to read in its entirety as follows:


 


1.                                       Page one (1), Paragraph 6 of the
Marketing and Servicing Agreement shall be amended to read as follows:


 


WHEREAS, BANK desires that ADVANCE AMERICA market and service, on
behalf of BANK, all TRANSACTIONS originated by BANK in the MARKET to the
exclusion of all other originators of similar transactions and ADVANCE AMERICA
agrees to do so. The Parties agree that BANK will continue to fund all
TRANSACTIONS that are originated by BANK in the MARKET pursuant to BANK’s
established underwriting criteria and serviced by AD VANCE AMERICA until and
unless BANK’s outstanding TRANSACTIONS under this Agreement together with any
other Marketing and Servicing Agreement with ADVANCE AMERICA equals [***] exclusive of TRANSACTIONS
rejected by BANK.


 


2.                                       Page eight (8), Section 5(c)(iv) of the
Marketing and Servicing Agreement shall be amended to read as follows:


 


(iv)                            ADVANCE AMERICA, on behalf of BANK, shall
(A) obtain from CUSTOMER the executed NOTE; (B) deliver an executed copy of the
NOTE to CUSTOMER; (C) obtain from CUSTOMER his or her REPAYMENT CHECK dated the
transaction date of the NOTE and made payable to BANK for the Total of Payments
set forth in the NOTE and held in trust separate and apart from ADVANCE AMERICA’s
records; and (D) not allow CUSTOMERS to engage in ROLLOVERS.


 


3.                                       Page nine (9), Section 5(d)(iii) of the
Marketing and Servicing Agreement shall be amended to read as follows:


 


25





















 


(iii)                          On each day ADVANCE AMERICA operates its
stores for regular business, ADVANCE AMERICA shall deposit and transfer to BANK
DEPOSIT ACCOUNT (A) all cash received from CUSTOMERS representing repayment of
TRANSACTIONS and (B) all REPAYMENT CHECKS held by ADVANCE AMERICA with respect
to TRANSACTIONS as to which repayment was not otherwise received on or before
the due date, subject to such delay in deposit, as ADVANCE AMERICA may
reasonably accommodate to secure repayment in cash from the CUSTOMER. However,
in no event shall ADVANCE AMERICA hold a check more than fourteen (14) days
past the due date.


 


4.                                       Exhibit B, Page 2, row entitled Total
Outstanding of the Marketing and Servicing Agreement shall be amended to
reference  [***] rather than  [***] in all applicable places in such row.


 


In the event of any conflict, inconsistency, or
incongruity between the provisions of this Third Amendment and any of the
provisions of the Marketing and Servicing Agreement, as amended, the provisions
of this Third Amendment shall in all respects govern and control.


 


IN WITNESS WHEREOF, ADVANCE AMERICA and BANK, each
intending to be legally bound hereby, have caused this Third Amendment to be
executed by its duly authorized officer as of the 15th of July,
2004.


 


	
  REPUBLIC BANK &
  TRUST COMPANY

  
	
   

  
	
   

  
	
  By:

  	
     /s/
  Bill Petter

  	
   

  
	
   

  
	
  Its:

  	
   

  	
   

  	
   

  
	
   

  
	
   

  
	
  ADVANCE AMERICA, CASH
  ADVANCE

  	
   

  
	
  CENTERS OF NORTH
  CAROLINA, INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
       /s/
  William M. Webster, IV

  	
   

  	
   

  
	
   

  	
       William
  M. Webster IV

  	
   

  	
   

  
	
   

  	
   

  
	
  Its: President

  	
   

  
					



 


FOURTH
AMENDMENT TO THE

MARKETING AND SERVICING AGREEMENT


 


THIS FOURTH AMENDMENT TO THE MARKETING AND SERVICING
AGREEMENT is an addendum to the MARKETING AND SERVICING AGREEMENT dated
February 12, 2003, by and between Republic Bank & Trust Company, a bank
organized under the laws of the Commonwealth of Kentucky (the “Bank”) and
Advance America, Cash Advance Centers of North Carolina, Inc., a Delaware
corporation (“Advance America”).


 


Pursuant to Section 12(k) of the Marketing and
Servicing Agreement, the BANK and ADVANCE AMERICA do hereby agree to amend the
Marketing and Servicing Agreement to read in its entirety as follows:


 


1.                                       Page one (1), Paragraph 6 of the
Marketing and Servicing Agreement shall be amended to read as follows:


 


WHEREAS, BANK desires that ADVANCE AMERICA market and service, on
behalf of BANK, all TRANSACTIONS originated by BANK in the MARKET to the
exclusion of all other originators of similar transactions and ADVANCE AMERICA
agrees to do so. The Parties agree that BANK will continue to fund all
TRANSACTIONS that are originated by BANK in the MARKET pursuant to BANK’s
established underwriting criteria and serviced by


 


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ADVANCE AMERICA until and unless BANK’s outstanding TRANSACTIONS under
this Agreement together with any other Marketing and Servicing Agreement with
ADVANCE AMERICA equals  [***] exclusive of TRANSACTIONS
rejected by BANK.


 


2.                                       Exhibit B, Page 2, row entitled Total
Outstanding of the Marketing and Servicing Agreement shall be amended to
reference  [***] in all applicable places
in such row.


 


In the event of any conflict, inconsistency, or
incongruity between the provisions of this Fourth Amendment and any of the
provisions of the Marketing and Servicing Agreement, as amended, the provisions
of this Fourth Amendment shall in all respects govern and control.


 


IN WITNESS WHEREOF, ADVANCE AMERICA and BANK, each
intending to be legally bound hereby, have caused this Fourth Amendment to be
executed by its duly authorized officer as of the 17th of January,
2005.


 


REPUBLIC BANK & TRUST
COMPANY


 


	
  By:

  	
     /s/
  Bill Petter

  	
   

  	
   

  
	
   

  	
   

  
	
  Its:

  	
      Executive
  Vice President

  	
   

  	
   

  
	
   

  	
      &
  Chief Operating Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  ADVANCE AMERICA, CASH
  ADVANCE

  	
   

  
	
  CENTERS OF NORTH
  CAROLINA, INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
      /s/
  William M. Webster IV

  	
   

  	
   

  
	
   

  	
      William
  M. Webster IV

  	
   

  
	
   

  	
   

  
	
  Its: President

  	
   

  
							



 


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