Document:

EXHIBIT 10.15

 

	
 
    

 

RISK RETENTION SUPPLEMENT

 

among

 

FORD MOTOR CREDIT COMPANY LLC,
 as Sponsor, Administrator and Servicer

 

FORD CREDIT FLOORPLAN LLC,
 as Depositor and holder of the Depositor Interest

 

and

 

FORD CREDIT FLOORPLAN MASTER OWNER TRUST A,
 as Issuer

 

Dated as of May 1, 2017

 

	
 
    

 

 

TABLE OF CONTENTS

 

	
ARTICLE I USAGE   AND DEFINITIONS
    	
1
    
	
Section 1.1.
    	
Usage and Definitions
    	
1
    
	
 
    	
 
    	
 
    
	
ARTICLE II   SUPPLEMENTAL TERMS
    	
1
    
	
Section 2.1.
    	
Definitions
    	
1
    
	
Section 2.2.
    	
Risk Retention   Agreements
    	
2
    
	
Section 2.3.
    	
Risk Retention   Reporting
    	
2
    
	
 
    	
 
    	
 
    
	
ARTICLE III   MISCELLANEOUS
    	
3
    
	
Section 3.1.
    	
Ratification of   Agreement
    	
3
    
	
Section 3.2.
    	
GOVERNING LAW
    	
3
    
	
Section 3.3.
    	
Counterparts
    	
3
    
	
Section 3.4.
    	
Issuer Order
    	
3
    

 

i

 

RISK RETENTION SUPPLEMENT, dated as of May 1, 2017 (this “Supplement”), among FORD MOTOR CREDIT COMPANY LLC, a Delaware limited liability company, as Sponsor, Administrator and Servicer, FORD CREDIT FLOORPLAN LLC, a Delaware limited liability company, as Depositor and holder of the Depositor Interest, and FORD CREDIT FLOORPLAN MASTER OWNER TRUST A, a Delaware statutory trust, as Issuer.

 

BACKGROUND

 

The Depositor, the Servicer and the Issuer are parties to the Fifth Amended and Restated Sale and Servicing Agreement, dated as of August 1, 2001, as amended and restated as of December 1, 2010 (the “Sale and Servicing Agreement”).

 

In connection with securitization transactions sponsored by Ford Credit, the parties have determined to supplement the Sale and Servicing Agreement to include risk retention terms.

 

The parties agree as follows:

 

ARTICLE I
 USAGE AND DEFINITIONS

 

Section 1.1.           Usage and Definitions.  Capitalized terms used but not defined in this Supplement are defined in Appendix A to the Sale and Servicing Agreement.  Appendix A also contains usage rules that apply to this Supplement.  Appendix A is incorporated by reference in this Supplement.

 

ARTICLE II
 SUPPLEMENTAL TERMS

 

Section 2.1.           Definitions.  Appendix A to the Sale and Servicing Agreement is supplemented by adding the following definitions alphabetically:

 

“AIFM Regulation” means the Alternative Investment Fund Managers Regulation ((EU) No. 231/2013).

 

“AIFMD” means the Alternative Investment Fund Managers Directive (2011/61/EU).

 

“CRR” means the Capital Requirements Regulation ((EU) No. 575/2013), as supplemented by the Commission Delegated Regulation (EU) No. 625/2014.

 

“EEA-Eligible Series” means each Series of Notes for which Ford Credit retains a material net economic interest that meets the requirements of the EEA Risk Retention Rules and is designated as an “EEA-Eligible Series” in the related Indenture Supplement.

 

“EEA Risk Retention Rules” means, for an EEA-Eligible Series, collectively (a) Articles 404-410 of the CRR, (b) Article 17 of the AIFMD, (c) Articles 50-56 of the AIFM Regulation, (d) Article 135(2) of the Solvency II Directive, (e) Articles 254-257 of the Solvency II Regulation and (f) any related guidelines and regulatory technical standards or implementing technical standards published from time to time by the European

 

 

Banking Authority (or any predecessor agency or authority) and, if applicable, adopted by the European Commission, in each case, to the extent these rules, regulations, guidelines and standards remain in effect as of the Series Issuance Date for the EEA-Eligible Series.

 

“Regulation RR” means Regulation RR under the Securities Exchange Act of 1934.

 

“Solvency II Directive” means the Solvency II Directive 2009/138/EC.

 

“Solvency II Regulation” means the Commission Delegated Regulation (EU) No. 2015/35.

 

Section 2.2.           Risk Retention Agreements.  The following terms are added to the Sale and Servicing Agreement as Section 2.13:

 

“Section 2.13.  Risk Retention.

 

(a)           Regulation RR Risk Retention.  To the extent required by Regulation RR, Ford Credit, as Sponsor, and the Depositor agree that (i) Ford Credit will cause the Depositor to, and the Depositor will, retain the Depositor Interest, (ii) Ford Credit will not permit the Depositor to, and the Depositor will not, sell, transfer, finance or hedge the Depositor Interest except as permitted by Regulation RR and (iii) Ford Credit and the Depositor will confirm on each Determination Date that the Depositor Interest is not less than 5% of the aggregate Note Balance of each Outstanding Series of Notes according to Regulation RR.

 

(b)           EEA Risk Retention.  While any EEA-Eligible Series is outstanding, to the extent required by the EEA Risk Retention Rules, Ford Credit will retain, as “originator” (as that term is used in the EEA Risk Retention Rules), on a consolidated basis through its 100% ownership interests in the Depositors, a material net economic interest in the Receivables of not less than 5% of the aggregate nominal value of the Receivables.  The method of retention will be in the form of an originator’s interest (as described in Article 405(1)(b) of the CRR, Article 51(1)(b) of the AIFM Regulation and Article 254(2)(b) of the Solvency II Regulation), which form will not change and which retention will not be subject to any credit risk mitigation, any short position or any other hedge and will not be sold, except to as permitted by the EEA Risk Retention Rules.

 

Section 2.3.           Risk Retention Reporting.  The existing paragraph in Section 3.4 of the Sale and Servicing Agreement is designated as subsection (a), and the following terms are added as subsections (b) and (c):

 

“(b)         Regulation RR Risk Retention Reporting.  To the extent required by Regulation RR, the Servicer will include the disclosure required by Rule 5(k)(1)(ii) of Regulation RR in the first Monthly Investor Report following each Series Issuance Date.

 

(c)           EEA Risk Retention Reporting.  While any EEA-Eligible Series is outstanding, and for so long as Ford Credit is the Servicer, the Sponsor will provide (or if Ford Credit is no longer Servicer, will instruct the Servicer to provide) certification of the Sponsor’s ongoing compliance with the EEA Risk Retention Rules (i) in each Monthly Investor

 

2

 

Report, (ii) promptly after any Event of Default for the Series and (iii) if there is any material change in the performance of the Receivables or the Notes of the Series, in each case, substantially to the effect of:

 

“EEA Credit Risk Retention:

 

As of the issue date of this report, Ford Motor Credit Company LLC discloses that it continues to retain, as “originator” (as that term is used in the EEA Risk Retention Rules), on a consolidated basis through its 100% ownership interests in the Depositors, a material net economic interest in the Receivables of not less than 5% of the aggregate nominal value of the Receivables.  The method of retention is in the form of an originator’s interest (as described in Article 405(1)(b) of the CRR, Article 51(1)(b) of the AIFM Regulation and Article 254(2)(b) of the Solvency II Regulation), which form has not changed and will not change and which retention will not be subject to any credit risk mitigation, any short position or any other hedge and will not be sold, except as permitted by the EEA Risk Retention Rules.”

 

If there is a breach of the Sponsor’s retention requirements under the EEA Risk Retention Rules or Section 2.13(b), for so long as Ford Credit is the Servicer, Ford Credit will provide (or if Ford Credit is no longer the Servicer, will instruct the Servicer to provide), reasonable detail about such breach in each Monthly Investor Report.”

 

ARTICLE III
 MISCELLANEOUS

 

Section 3.1.           Ratification of Agreement.  The Sale and Servicing Agreement, as supplemented by this Supplement, is ratified and confirmed.

 

Section 3.2.           GOVERNING LAW.  THIS SUPPLEMENT WILL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAWS OF THE STATE OF NEW YORK.

 

Section 3.3.           Counterparts.  This Supplement may be executed in multiple counterparts.  Each counterpart will be an original and all counterparts will together be one document.

 

Section 3.4.           Issuer Order. Pursuant to Section 5.6 of the Trust Agreement, the Administrator, by its execution hereof, hereby authorizes and orders the Owner Trustee to execute this Supplement.

 

[Remainder of Page Left Blank]

 

3

 

	
EXECUTED   BY:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
FORD   MOTOR CREDIT COMPANY LLC,
    
	
 
    	
 
    	
as   Sponsor, Administrator and Servicer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
David   A. Webb
    
	
 
    	
 
    	
Title:
    	
Assistant   Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
FORD   CREDIT FLOORPLAN LLC,
    
	
 
    	
 
    	
as   Depositor and holder of the Depositor Interest
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
David   A. Webb
    
	
 
    	
 
    	
Title:
    	
President   and Assistant Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
FORD   CREDIT FLOORPLAN MASTER OWNER
    
	
 
    	
 
    	
TRUST   A, as Issuer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
U.S.   BANK TRUST NATIONAL ASSOCIATION, not in its individual capacity, but solely   as Owner Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

[Signature Page to Risk Retention Supplement (FCF LLC)]ex10-1.htm

Exhibit 10.1

 

2017 MERCANTILE EXECUTIVE OFFICER BONUS PLAN

 

 

 

1.             Purpose of this Plan

 

This 2017 Mercantile Executive Officer Bonus Plan (this “Plan”) is designed to reflect that the directors of Mercantile Bank Corporation (the “Company”) and Mercantile Bank of Michigan (the “Bank”) believe that the Company’s shareholders are willing to share financially in operating results that exceed certain specific financial metrics.

 

The purpose of this Plan is to:

 

	 	
•
	
Promote the growth, profitability and expense control necessary to accomplish corporate strategic long-term plans;

 

 

 

	 	
•
	
Encourage superior results by providing a meaningful incentive; and

 

 

 

	 	
•
	
Support teamwork among employees.

 

2.             Eligibility

 

Michael H. Price, Robert B. Kaminski, Jr., Charles E. Christmas, Raymond E. Reitsma and Robert T. Worthington (the “Executive Officers,” and each an “Executive Officer”) are included in this Plan. The following provisions (a) – (d) set forth circumstances where an Executive Officer will, or will not, be eligible for a bonus payout, or where an unpaid bonus award will be cancelled:

 

(a) Except as provided below, an Executive Officer must be an active employee as of December 31, 2017 to be eligible to receive a bonus payout. 

 

(b) An Executive Officer that is out on medical leave as of December 31, 2017 will be eligible to receive a bonus award. 

 

(c) An Executive Officer that is suspended with or without pay or is on final written warning as of December 31, 2017 will not be eligible to receive a bonus award. 

 

(d) If an Executive Officer terminates his or her employment with the Bank during 2017, any unpaid bonus award for the Executive Officer is cancelled. 

 

 

 

1

 

  

Notwithstanding any of the provisions (a), (b), (c) or (d) above, no such provision shall adversely affect an Executive Officer’s eligibility for, or right to receive, any bonus award, if during 2017, or during the first four months of 2018 pursuant to a notice given in 2017, (i) the employment of Messrs. Price, Kaminski or Christmas terminates under one or more circumstances set forth in Section 8.5 or 9 of the Employment Agreement made as of November 13, 2014 between such Executive Officer, the Company and the Bank, as amended, in which case, such Executive Officer is eligible for 100% of his bonus payout, or (ii) the employment of Mr. Reitsma terminates under one or more circumstances set forth in Section 10.5 or 10.6 of the Employment Agreement made as of November 19, 2015 between Mr. Reitsma and the Bank, as amended, in which case, Mr. Reitsma is eligible for a pro rata share of his bonus payout, or (iii) the employment of Mr. Worthington terminates under one or more circumstances set forth in Section 10.5 or 10.6 of the Amended and Restated Employment Agreement made as of December 15, 2016 among Mr. Worthington, the Company and the Bank, in which case, Mr. Worthington is eligible for a pro rata share of his bonus payout (each, a “Special Termination”).

 

3.             Bonus Pool, Performance Metrics and Bonus Awards

 

The maximum amount that will be allocated to the bonus pool under this Plan (the “Executive Bonus Pool”) is $466,218, provided, however, that the maximum amount will be appropriately adjusted if (a) a newly hired employee becomes a named executive officer (as defined in Item 402(a)(3) of SEC Regulations S-K) and becomes eligible to participate in this Plan, (b) an Executive Officer's base salary is adjusted during the year, or (c) an Executive Officer becomes ineligible before December 31, 2017. 

 

Payment from the Executive Bonus Pool, if any, is based on the achievement of targets under the following 2017 Executive Bonus Metrics:

 

10%     Net loan growth
10%     Non-performing assets
10%     Commercial loan portfolio composition
10%     Net interest margin
10%     Non-interest income
10%     Efficiency ratio
10%     Core pre-tax income
10%     Return on assets
10%     Return on equity
10%     Wholesale funds

 

 

 

2

 

 

The specific targets for each metric will be established by the Compensation Committee of the Company. 

 

Each individual target must be met or exceeded in order for the percentage associated with that metric to be credited toward payment from the Executive Bonus Pool. The accumulated percentage for each individual target attained will be applied to the Executive Bonus Pool to determine the total amount of the Executive Bonus Pool to be awarded (the “Award Amount”). For example, if the first five factors are attained and the next five factors are not attained, and if the maximum amount is allocated to the Executive Bonus Pool, the Award Amount under this Plan would be $466,218 x 50% = $233,109. 

 

The Award Amount will be paid to each Executive Officer pro rata based on a uniform percentage of the Executive Officer's 2017 salary (not to exceed 30% of each Executive Officer's 2017 salary, and taking into account the adjustment to be made to Mr. Price's 2017 base salary following the 2017 annual meeting of the Company's shareholders.) 

 

4.            Clawback Provision

 

Payouts made under this Plan are subject to recovery or clawback, and an Executive Officer receiving a payout will be required to promptly return the monies (or any portion of the monies requested by the Company) in each of the following circumstances: 

 

	 	
●
	
if it is determined that the Executive Officer was engaging in an activity during 2017 that would have resulted in the employee being suspended without pay, placed on final written warning or terminated on or before December 31, 2017, and no Special Termination of the Executive Officer is involved.

 

 

 

	 	
●
	
If the payout is based on materially inaccurate financial statements (which includes, but is not limited to statements of earnings, revenues, or gains) or any other materially inaccurate performance metric criteria, including net income.

 

 

 

	 	
●
	
If the payout is required to be returned pursuant to a policy adopted by the Company regarding clawback in order to comply with the Dodd-Frank Wall Street Reform and Consumer Protection Act or any stock exchange or other rule adopted pursuant to that Act.

 

In the event that the Company or Bank demands recovery or clawback of any payout (or portion of any payout), and the Executive Officer who received the payout does not promptly return the payout (or demanded portion of the payout) to the Company or the Bank, the Executive Officer shall be required to pay to the Company or the Bank, immediately upon demand, all expenses, including reasonable attorneys’ fees, incurred to recover the payout (or demanded portion of the payout), unless the Executive Officer establishes in an appropriate legal proceeding that he or she had no obligation under this Section of this Plan to return the payout (or demanded portion of the payout). Executive Officers, as a condition to receiving a payout under this Plan, may be required to agree in writing to the terms of this Section.

 

 

 

3

 

 

5.             Timing of Bonus Payouts

 

Bonus awards that are earned under this Plan will be paid to eligible Executive Officers on or before March 15, 2018.

 

6.             Plan Administration

 

The Board of Directors of the Company and the its Compensation Committee, or if the Board of Directors of the Company so designates, another committee of the Board of Directors of the Company or the Bank (each, an "Administrator"), will each have the authority to administer and interpret this Plan, and approve or determine the amounts to be distributed under this Plan as bonus awards, in its sole discretion. Any interpretation or construction of this Plan or approval or determination of bonus awards by an Administrator will be final and binding on the Company, the Bank and their respective subsidiaries, all employees and past employees of any of them, their heirs, successors and assigns. No member of the Board of Directors of the Bank or the Company, or any of their affiliates, or any committee of the Board of Directors of the Bank, the Company, or any affiliate, will be liable for any action or determination made in good faith regarding this Plan or any bonus award.

 

7.             No Right to Employment

 

This Plan does not give any Executive Officer any right to continued employment, or limit in any way the right of the Bank or any affiliated company to terminate his employment at any time.

 

8.             Withholding of Taxes

 

The Bank and any affiliated company will have the right to deduct from any payment to be made pursuant to this Plan any Federal, state or local taxes required by law to be withheld. It is contemplated that substantially all payments that are made under this Plan will be made by the Bank or one of its subsidiaries, and not by the Company.

 

9.             Amendment of this Plan

 

This Plan may be amended from time to time by the Compensation Committee of the Company, without the consent of any Executive Officer or past Executive Officer, (a) to the extent required to comply with applicable law; (b) to make reasonable adjustments for any acquisition or sale of a business or branch, merger, reorganization, or restructuring, change in accounting principles or their application, or special charges or extraordinary items, that materially affect the Company or any of its consolidated subsidiaries; (c) to make any changes that do not materially and adversely affect the bonus award payable to any eligible employee; (d) to expand the Executive Officers or other employees who are eligible to receive a bonus from the amounts available for bonuses under this Plan; or (e) to make any other changes that the Compensation Committee of the Company, in its sole discretion, deems appropriate, even if such changes materially and adversely affect, or eliminate, the bonus award payable to any Executive Officer or past Executive Officer; provided that, after a Special Termination or notice that will result in a Special Termination, no amendment made under provision (d) or (e) of this paragraph above shall adversely affect an Executive Officer’s rights under this Plan. 

 

10.          Governing Law

 

The validity, construction and interpretation of this Plan will be determined in accordance with the laws of the State of Michigan.

 

11.          Effective Date

 

This Plan was approved by the Boards of Directors of the Company and the Bank on May 25, 2017, and is effective as of January 1, 2017.

 

 

 4

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