Prepared by MERRILL CORPORATION









Exhibit 10.45




PARTICIPATION AGREEMENT




 




 




This

Participation Agreement is made as of the 5th day of December, 2001 by and

between Affinity Group Thrift Holding Corp. (“Thrift Holding”) and the Stephen

Adams Living Trust (“Adams”).




 




WITNESSETH:




 




                WHEREAS, Thrift Holding is the holder of a

capital note issued by Affinity Bank Holdings Inc. (the “Maker”) on October 1,

1999 in the original principal amount of $18,636,615 (the “Capital Note”);




 




                WHEREAS, Adams purchased a $1.5 million

participation in the Capital Note by the terms of a participation agreement

dated as of October 31, 2000 made between Thrift Holding and Adams (the “Prior

Participation Agreement”);




 




                WHEREAS, the Capital Note does not require

any payments to be made on a current basis, no payments of principal or

interest have been made on the Capital Note since the issuance of the Capital

Note and interest has accrued thereon at the rate set forth therein since the

date thereof;




 




                WHEREAS, Thrift Holding is desirous of

selling an additional participation in the Capital Note on substantially the

same terms and conditions as in the Prior Participation Agreement;




 




                WHEREAS, Adams is willing to purchase a

participation in the Capital Note at par provided that (i) payments received in

respect of the Capital Note are applied on a “LIFO” basis and paid first to

Adams to the extent of Adams’ interest therein and (ii) Thrift Holding

reimburse Adams for the origination fees (aggregating $450,000) and the

allocable share of the lender’s legal fees ($72,581) incurred by an affiliate

of Adams in obtaining funds for the purchase of such participation;




 




                WHEREAS, Thrift Holding is willing to sell

such participation to Adams.




 




                NOW, THEREFORE, in consideration of the

payment of $15 million by Adams to Thrift Holding, the receipt of which is

acknowledged by Thrift Holding, Thrift Holding and Adams agree as follows:




 




                1.             Participation.  Thrift Holding hereby grants to Adams a

participation in the Capital Note to the extent of $15 million of principal

thereof, together with (i) interest on such $15 million at the rate set forth

in the Capital Note from the date hereof and (ii) any pro rata premium, penalty

or other amounts payable in respect of the Capital Note by the terms

thereof.  All payments made in respect

of the Capital Note shall be first applied to accrued interest on Adams’

interest therein and then to the principal amount of Adams’ interest therein,

Thrift Holding agreeing that it shall retain no payment in respect of the

Capital Note until the participation of Adams therein has been paid in full to

Adams.  If Adams’ interest shall not

have been paid directly to Adams by the Maker, Thrift Holding agrees to remit,

contemporaneously with its receipt thereof, Adams’ interest in any such

payment.  As between Adams’ participation

in the Capital Note pursuant to this Participation Agreement and Adams’

participation in the Capital Note pursuant to the Prior Participation

Agreement, amounts shall be allocated by Adams in such manner as is determined

by Adams, in Adams’ sole discretion.













                2.             Fees.  Thrift Holding agrees (i) to pay, directly

to CIBC Capital Markets (“CIBC”), a fee in the amount of $450,000 committed to

be paid by AOA Holding LLC, an affiliate of Adams, in connection with the

funding of the purchase of the participation pursuant to this Participation

Agreement, and (ii) to reimburse AOA for the allocable portion of CIBC’s legal

fees, $72,581, such payments to be made by Thrift Holding contemporaneously

with the receipt of funds by Thrift from Adams hereunder.




 




                3.             Acceptance.  Adams accepts the participation in the

Capital Note granted pursuant to Section 1 above subject to the terms of the

Capital Note and acknowledges that its interest therein is subject to the terms

thereof and the instruments governing the issuance thereof, including the

instruments referenced in a letter dated October 1, 1999 from the Maker to

Thrift Holding by virtue of which the Capital Note was issued.




 




                4.             Representations

and Warranties of Thrift Holding. 

Thrift Holding represents and warrants to Adams that:




 




                                a.             Title.  Thrift Holding is the owner of the Capital

Note, free and clear of any liens, mortgages, charges, security interests,

encumbrances or other restrictions or limitations and has the legal right and

authority to grant to Adams a participation in the Capital Note as provided

herein.




 




                                b.             No

Breach.  The execution, delivery,

validity and enforceability of this Participation Agreement by Thrift Holding,

the consummation of the transactions provided for hereby by Thrift Holding, and

the performance by Thrift Holding of its obligations contemplated hereunder

will not (i) violate, conflict with or result in a breach or termination of, or

otherwise give any other person a right to terminate, or constitute a default,

event of default or event which with notice, lapse of time or both, would

constitute a default of event of default under, the terms of any material

contract, indenture or other instrument by which Thrift Holding is bound, (ii)

result in the creation of any lien on the Capital Note, (iii) constitute a

violation by Thrift Holding of any statute, rule or regulation or (iv) give

rise to any preferential right to purchase in favor of any third party.




 




                5.             Representations

and Warranties of Adams.  Adams

hereby represents and warrants to Thrift Holding that:













 




                                a.             Investment

Intent.  Adams is acquiring the

participation in the Capital Note for its own account for investment and with

no present intention of distributing such interest or any part thereof.




 




                                b.             Purchase

Investigation.  Adams has received

and is familiar with such information with respect to the Maker and the Maker’s

historical and projected performance as Adams deems necessary for the purpose

of purchasing the participation in the Capital Note and desires no further

information which respect thereto. 

Adams acknowledges that Adams is not relying on any information provided

by Thrift Holding in respect thereof.




 




                                c.             No

Breach.  The execution, delivery,

validity and enforceability of this Participation Agreement by Adams, the

consummation of the transactions provided for hereby by Adams, and the

performance by Adams of its obligations contemplated hereunder will not

violate, conflict with or result in a breach or termination of, or otherwise

give any other person a right to terminate or constitute a default, event of

default or an event which, with notice, lapse of time or both, would constitute

a default or event of default under, the terms of any material contract by

which Adams is bound.




 




                6.             Miscellaneous.  This Participation Agreement shall be binding upon and shall inure to the benefit of the

parties hereto and their respective successors and assigns.  This Participation Agreement shall be

construed and enforced in accordance with the laws of the state of California.  This Participation Agreement may be executed in any number of counterparts,

each of which shall be deemed an original, but all of which shall constitute

one and the same instrument.  This

Participation Agreement contains the entire understanding of the parties with

respect to the subject matter hereof and may not be varied, modified or amended

except by a writing signed by the parties to be charged.  The making, execution and delivery of this

Participation Agreement by the parties hereto have been induced by no

representations, statements, warranties or agreement of the other except those

herein expressed.




 




                IN WITNESS WHEREOF, the parties hereto have

caused these presents to be executed as of the day and year first above

written.




 




	

   


  	

  AFFINITY GROUP THRIFT HOLDING CORP.


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  /s/


  
	

   


  	

  Name:


  	

  Mark J. Boggess


  
	

   


  	

  Title:


  	

  Senior Vice President


  
	

   


  	

   


  	

   


  
	

   


  	

  STEPHEN ADAMS LIVING TRUST


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  /s/


  
	

   


  	

  Name:


  	

  Stephen Adams


  
	

   


  	

  Title:


  	

  Trustee