INFORMATION DENOTED BY [*] HEREIN HAS BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT. THIS INFORMATION HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
SEVENTEENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Seventeenth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of March 31, 2004 by First NLC Financial Services, LLC
and NLC Financial Services, LLC (collectively, the "Company"), and Washington
Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Commitment. Section 2.1(a) of the Loan Agreement is hereby amended
and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and
provided that no Default or Event of Default has occurred and is
continuing, Lender agrees, from time to time, during the period
from the date hereof to and including the Termination Date, to
make Advances to Company, provided the sum of the total aggregate
principal amount outstanding at any one time of all such Advances
shall not exceed $56,000,000; provided, however, commencing March
31, 2004 and continuing through and including May 31, 2004, the
sum of the total aggregate principal amount outstanding at any
one time of all such Advances shall not exceed $84,000,000. The
obligation of Lender to make Advances hereunder up to such limit
is hereinafter referred to as the "Commitment." Within the
Commitment, Company may borrow, repay, and reborrow. All Advances
under this Agreement shall constitute a single indebtedness, and
all of the Collateral shall be security for the Note and for the
performance of all the Obligations of Company to Lender.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and delivery by Company of an Amended and Restated
Promissory Note in the original principal amount of $84,000,000 ("Note"); and
(c) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
Note and the performance of the transactions herein contemplated (i) are and
will be within such party's powers, (ii) have been authorized by all necessary
organizational action, and (iii) are not and will not be in contravention of any
order of any court or other agency of government, of law or any other indenture,
agreement or undertaking to which Company is a party or by which the property of
Company is bound, or be in conflict with, result in a breach of, or constitute
(with due notice and/or lapse of time) a default under any such indenture,
agreement or undertaking or result in the imposition of any lien, charge or
encumbrance of any nature on any of the properties of Company.
(c) This Amendment, the Note and any assignment, instrument, document,
or agreement executed and delivered in connection herewith, will be valid,
binding, and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company RELEASES, RELINQUISHES
and forever DISCHARGES Lender, and its predecessors, successors, assigns,
shareholders, principals, parents, subsidiaries, agents, officers, directors,
employees, attorneys and representatives (collectively, the "Released Parties"),
of and from any and all claims, demands, actions and causes of action of any and
every
2
kind or character, whether known or unknown, present or future, which Company
has, or may have against Released Parties, arising out of or with respect to any
and all transactions relating to the Loan Agreement, the Note, and the other
Existing Loan Documents occurring prior to the date hereof, including any other
loss, expense and/or detriment, of any kind or character, growing out of or in
any way connected with or in any way resulting from the acts, actions or
omissions of the Released Parties, and including any loss, cost or damage in
connection with any breach of fiduciary duty, breach of any duty of fair
dealing, breach of competence, breach of funding commitment, undue influence,
duress, economic coercion, conflict of interest, negligence, bad faith,
malpractice, violations of the Racketeer Influence and Corrupt Organizations
Act, intentional or negligent infliction of emotional or mental distress,
tortious interference with corporate governments or prospective business
advantage, tortious interference with contractual relations, breach of contract,
deceptive trade practices, libel, slander, conspiracy, the charging, contracting
for, taking, reserving, collecting or receiving of interest in excess of the
highest lawful rate applicable to the Existing Loan Documents (i.e., usury), any
violations of federal or state law, any violations of federal or state banking
rules, laws or regulations, including, but not limited to, any violations of
Regulation B, Equal Credit Opportunity, bank tying act claims or any violation
of federal antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment, and all matters arising out of or related
to this Amendment, shall be governed by, construed and enforced in accordance
with the laws of the State of Texas, excluding its conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
Title: President COO
----------------------------------
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
-----------------------------------
Title: President COO
----------------------------------
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxx
-----------------------------------
Title: Vice President
----------------------------------
[SIGNATURE PAGE TO SEVENTEENTH AMENDMENT]
S-1
SIXTEENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Sixteenth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of March 18, 2004 by First NLC Financial Services, LLC
and NLC Financial Services, LLC (collectively, the "Company"), and Washington
Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Commitment. Section 2.1(a) of the Loan Agreement is hereby amended
and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and
provided that no Default or Event of Default has occurred and is
continuing, Lender agrees, from time to time, during the period
from the date hereof to and including the Termination Date, to
make Advances to Company, provided the sum of the total aggregate
principal amount outstanding at any one time of all such Advances
shall not exceed $56,000,000; provided, however, commencing March
18, 2004 and continuing through and including March 25, 2004, the
sum of the total aggregate principal amount outstanding at any
one time of all such Advances shall not exceed $66,000,000. The
obligation of Lender to make Advances hereunder up to such limit
is hereinafter referred to as the "Commitment." Within the
Commitment, Company may borrow, repay, and reborrow. All Advances
under this Agreement shall constitute a single indebtedness, and
all of the Collateral shall be security for the Note and for the
performance of all the Obligations of Company to Lender.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and delivery by Company of an Amended and Restated
Promissory Note in the original principal amount of $66,000,000 ("Note"); and
(c) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
Note and the performance of the transactions herein contemplated (i) are and
will be within such party's powers, (ii) have been authorized by all necessary
organizational action, and (iii) are not and will not be in contravention of any
order of any court or other agency of government, of law or any other indenture,
agreement or undertaking to which Company is a party or by which the property of
Company is bound, or be in conflict with, result in a breach of, or constitute
(with due notice and/or lapse of time) a default under any such indenture,
agreement or undertaking or result in the imposition of any lien, charge or
encumbrance of any nature on any of the properties of Company.
(c) This Amendment, the Note and any assignment, instrument, document,
or agreement executed and delivered in connection herewith, will be valid,
binding, and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company RELEASES, RELINQUISHES
and forever DISCHARGES Lender, and its predecessors, successors, assigns,
shareholders, principals, parents, subsidiaries, agents, officers, directors,
employees, attorneys and representatives (collectively, the "Released Parties"),
of and from any and all claims, demands, actions and causes of action of any and
every
2
kind or character, whether known or unknown, present or future, which Company
has, or may have against Released Parties, arising out of or with respect to any
and all transactions relating to the Loan Agreement, the Note, and the other
Existing Loan Documents occurring prior to the date hereof, including any other
loss, expense and/or detriment, of any kind or character, growing out of or in
any way connected with or in any way resulting from the acts, actions or
omissions of the Released Parties, and including any loss, cost or damage in
connection with any breach of fiduciary duty, breach of any duty of fair
dealing, breach of competence, breach of funding commitment, undue influence,
duress, economic coercion, conflict of interest, negligence, bad faith,
malpractice, violations of the Racketeer Influence and Corrupt Organizations
Act, intentional or negligent infliction of emotional or mental distress,
tortious interference with corporate governments or prospective business
advantage, tortious interference with contractual relations, breach of contract,
deceptive trade practices, libel, slander, conspiracy, the charging, contracting
for, taking, reserving, collecting or receiving of interest in excess of the
highest lawful rate applicable to the Existing Loan Documents (i.e., usury), any
violations of federal or state law, any violations of federal or state banking
rules, laws or regulations, including, but not limited to, any violations of
Regulation B, Equal Credit Opportunity, bank tying act claims or any violation
of federal antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment, and all matters arising out of or related
to this Amendment, shall be governed by, construed and enforced in accordance
with the laws of the State of Texas, excluding its conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above
COMPANY: FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT COO
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT COO
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxxx X. Xxxxxx VP
------------------------------------
Name: XXXXXXX X. XXXXXX
Title: VICE PRESIDENT
[SIGNATURE PAGE TO SIXTEENTH AMENDMENT]
S-l
FIFTEENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Fifteenth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of February 17, 2004 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Definitions. Section 1.1 of the Loan Agreement is amended to
include the following additional definition:
"Financial Statements" shall mean the Financial Statements
Company is obligated to deliver pursuant to Section 6.2 of this
Agreement.
"Interest Adjustment Date" shall mean for the purposes of Section
2.4(d), that date which is the later of Lender's receipt of each
of (i) Company's monthly and annual Financial Statements and (ii)
Company's Officer's Certificate for each such period.
(b) Commitment. Section 2.1 (a) of the Loan Agreement is hereby
amended and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and
provided that no Default or Event of Default has occurred and is
continuing, Lender agrees, from time to time, during the period
from the date hereof to and including the Termination Date, to
make Advances to Company, provided the sum of the total aggregate
principal amount outstanding at any one time of all such Advances
shall not exceed
$56,000,000. The obligation of Lender to make Advances hereunder
up to such limit is hereinafter referred to as the "Commitment."
Within the Commitment, Company may borrow, repay, and reborrow.
All Advances under this Agreement shall constitute a single
indebtedness, and all of the Collateral shall be security for the
Note and for the performance of all the Obligations of Company to
Lender.
(c) Second Mortgage Loans. Section 2.1 (b)(5) of the Loan Agreement is
hereby amended and restated in its entirety as follows:
(5) The aggregate amount of Second Mortgage Loan Advances
outstanding at any one time shall not exceed $10,000,000.
(d) Financial Covenants. Section 7.5 and Section 7.6 of the Loan
Agreement is amended and restated in their entirety as follows:
7.5 Indebtedness to Tangible Net Worth Ratio. Permit the ratio of
Indebtedness to Tangible Net Worth of the Company (and its
Subsidiaries, on a consolidated basis) to exceed 20.0 to 1 as of
the end of each calendar moth.
7.6 Minimum Adjusted Tangible Net Worth. Permit Adjusted Tangible
Net Worth of the Company (and its Subsidiaries, on a consolidated
basis) to be less than Twelve Million Dollars ($12,000,000),
computed as of the end of each calendar month.
(e) Interest. Section 2.4 of the Loan is amended to include the
following new Section 2.4(d) as follows:
(d) On a monthly basis, the applicable interest rate of all
Obligations shall be determined in accordance with the following
matrix (no downward rate adjustment being permitted if on the Interest
Adjustment Date an Event of Default or Default is outstanding):
-----------------------------------------------------------------
Indebtedness to Tangible Net
Worth Ratio Rate of Interest
-----------------------------------------------------------------
Equal to or less than 15.0 to 1 Interest Rate
-----------------------------------------------------------------
Greater than 15.0 to 1 Interest Rate + [*] basis points
-----------------------------------------------------------------
For purposes of the foregoing, (i) the ratio of Indebtedness to
Tangible Net Worth will be determined by Lender on a monthly basis by
reference to Company's Financial Statements and Officer's
2
Certificates delivered pursuant to Section 6.2 herein; and (ii) if
Company fails to timely deliver the applicable Officer's Certificates
and Financial Statements to Lender in accordance with Section 6.2
herein for any period, then at Lender's option, the rate of interest
on the Obligations will be increased to the highest rate of interest
pursuant to the above matrix, which rate of interest shall continue in
effect until the Officer's Certificates and Financial Statements are
delivered.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
performance of the transactions herein contemplated (i) are and will be within
such party's powers, (ii) have been authorised by all necessary organizational
action, and (iii) are not and will not be in contravention of any order of any
court or other agency of government, of law or any other indenture, agreement or
undertaking to which Company is a party or by which the property of Company is
bound, or be in conflict with, result in a breach of, or constitute (with due
notice and/or lapse of time) a default under any such indenture, agreement or
undertaking or result in the imposition of any lien, charge or encumbrance of
any nature on any of the properties of Company.
(c) This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding,
and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced
3
by the Note according to the terms thereof. In consideration of the modification
of certain provisions of the Existing Loan Documents, all as herein provided,
and the other benefits received by Company hereunder, Company RELEASES,
RELINQUISHES and forever DISCHARGES Lender, and its predecessors, successors,
assigns, shareholders, principals, parents, subsidiaries, agents, officers,
directors, employees, attorneys and representatives (collectively, the "Released
Parties"), of and from any and all claims, demands, actions and causes of action
of any and every kind or character, whether known or unknown, present or future,
which Company has, or may have against Released Parties, arising out of or with
respect to any and all transactions relating to the Loan Agreement, the Note,
and the other Existing Loan Documents occurring prior to the date hereof,
including any other loss, expense and/or detriment, of any kind or character,
growing out of or in any way connected with or in any way resulting from the
acts, actions or omissions of the Released Parties, and including any loss, cost
or damage in connection with any breach of fiduciary duty, breach of any duty of
fair dealing, breach of competence, breach of funding commitment, undue
influence, duress, economic coercion, conflict of interest, negligence, bad
faith, malpractice, violations of the Racketeer Influence and Corrupt
Organizations Act, intentional or negligent infliction of emotional or mental
distress, tortious interference with corporate governments or prospective
business advantage, tortious interference with contractual relations, breach of
contract, deceptive trade practices, libel, slander, conspiracy, the charging,
contracting for, taking, reserving, collecting or receiving of interest in
excess of the highest lawful rate applicable to the Existing Loan Documents
(i.e., usury), any violations of federal or state law, any violations of federal
or state banking rules, laws or regulations, including, but not limited to, any
violations of Regulation B, Equal Credit Opportunity, bank tying act claims or
any violation of federal antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment, and all matters arising out of or related
to this Amendment, shall be governed by, construed and enforced in accordance
with the laws of the State of Texas, excluding its conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
4
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxxx X. Xxxxxx VP
------------------------------------
Name: XXXXXXX X. XXXXXX
Title: VICE PRESIDENT
[SIGNATURE PAGE TO FIFTEENTH AMENDMENT]
S-1
FOURTEENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Fourteenth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of January 13, 2004 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Commitment. Section 2.1 (a) of the Loan Agreement is hereby
amended and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing,
Lender agrees, from time to time, during the period from the date
hereof to and including the Termination Date, to make Advances to
Company, provided the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed
$40,000,000; provided, however, commencing January 13, 2004 and
continuing through and including February 17, 2004, such amount shall
not exceed $58,000,000. The obligation of Lender to make Advances
hereunder up to such limit is hereinafter referred to as the
"Commitment." Within the Commitment, Company may borrow, repay and
reborrow. All Advances under this Agreement shall constitute a single
indebtedness, and all of the Collateral shall be security for the Note
and for the performance of all the Obligations of Company to Lender.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and
substance satisfactory to Lender and Lender's counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Delivery of an unanimous written consent from Company's member
authorizing the execution and delivery of this Amendment, and the transactions
contemplated hereunder; and
(c) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
performance of the transactions herein contemplated (i) are and will be within
such party's powers, (ii) have been authorized by all necessary organizational
action, and (iii) are not and will not be in contravention of any order of any
court or other agency of government, of law or any other indenture, agreement or
undertaking to which Company is a party or by which the property of Company is
bound, or be in conflict with, result in a breach of, or constitute (with due
notice and/or lapse of time) a default under any such indenture, agreement or
undertaking or result in the imposition of any lien, charge or encumbrance of
any nature on any of the properties of Company.
(c) This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company RELEASES, RELINQUISHES
and forever DISCHARGES Lender, and its predecessors, successors, assigns,
shareholders, principals, parents, subsidiaries, agents, officers, directors,
employees, attorneys and representatives (collectively, the "Released Parties"),
of and from any and all claims, demands, actions and causes of action of any and
every kind or character, whether known or unknown, present or future, which
Company has, or may have
2
against Released Parties, arising out of or with respect to any and all
transactions relating to the Loan Agreement, the Note, and the other Existing
Loan Documents occurring prior to the date hereof, including any other loss,
expense and/or detriment, of any kind or character, growing out of or in any way
connected with or in any way resulting from the acts, actions or omissions of
the Released Parties, and including any loss, cost or damage in connection with
any breach of fiduciary duty, breach of any duty of fair dealing, breach of
competence, breach of funding commitment, undue influence, duress, economic
coercion, conflict of interest, negligence, bad faith, malpractice, violations
of the Racketeer Influence and Corrupt Organizations Act, intentional or
negligent infliction of emotional or mental distress, tortious interference with
corporate governments or prospective business advantage, tortious interference
with contractual relations, breach of contract, deceptive trade practices,
libel, slander, conspiracy, the charging, contracting for, taking, reserving,
collecting or receiving of interest in excess of the highest lawful rate
applicable to the Existing Loan Documents (i.e., usury), any violations of
federal or state law, any violations of federal or state banking rules, laws or
regulations, including, but not limited to, any violations of Regulation B,
Equal Credit Opportunity, bank tying act claims or any violation of federal
antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: XXXXXXX X. XXXXXX
Title: VICE PRESIDENT
[SIGNATURE PAGE TO THIRTEENTH AMENDMENT]
S-l
THIRTEENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Thirteenth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of November 14, 2003 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Commitment. Section 2.1 (a) of the Loan Agreement is hereby
amended and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing,
Lender agrees, from time to time, during the period from the date
hereof to and including the Termination Date, to make Advances to
Company, provided the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed
$40,000,000; provided, however, commencing November 14, 2003 and
continuing through and including January 13, 2004, such amount shall
not exceed $60,000,000. The obligation of Lender to make Advances
hereunder up to such limit is hereinafter referred to as the
"Commitment." Within the Commitment, Company may borrow, repay and
reborrow. All Advances under this Agreement shall constitute a single
indebtedness, and all of the Collateral shall be security for the Note
and for the performance of all the Obligations of Company to Lender.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion
of the following conditions precedent (all agreements, documents and instruments
to be in form and substance satisfactory to Lender and Lender's counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and delivery by Company of an amended and restated
Promissory Note in the original principal amount of $60,000,000 ("Note");
(c) Delivery of an unanimous written consent from Company's member
authorizing the execution and delivery of this Amendment, the Note and the
transactions contemplated hereunder; and
(d) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
Note and the performance of the transactions herein contemplated (i) are and
will be within such party's powers, (ii) have been authorized by all necessary
organizational action, and (iii) are not and will not be in contravention of any
order of any court or other agency of government, of law or any other indenture,
agreement or undertaking to which Company is a party or by which the property of
Company is bound, or be in conflict with, result in a breach of, or constitute
(with due notice and/or lapse of time) a default under any such indenture,
agreement or undertaking or result in the imposition of any lien, charge or
encumbrance of any nature on any of the properties of Company.
(c) This Amendment, the Note and any assignment, instrument, document,
or agreement executed and delivered in connection herewith, will be valid,
binding and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company RELEASES, RELINQUISHES
and forever DISCHARGES
2
Lender, and its predecessors, successors, assigns, shareholders, principals,
parents, subsidiaries, agents, officers, directors, employees, attorneys and
representatives (collectively, the "Released Parties"), of and from any and all
claims, demands, actions and causes of action of any and every kind or
character, whether known or unknown, present or future, which Company has, or
may have against Released Parties, arising out of or with respect to any and all
transactions relating to the Loan Agreement, the Note, and the other Existing
Loan Documents occurring prior to the date hereof, including any other loss,
expense and/or detriment, of any kind or character, growing out of or in any way
connected with or in any way resulting from the acts, actions or omissions of
the Released Parties, and including any loss, cost or damage in connection with
any breach of fiduciary duty, breach of any duty of fair dealing, breach of
competence, breach of funding commitment, undue influence, duress, economic
coercion, conflict of interest, negligence, bad faith, malpractice, violations
of the Racketeer Influence and Corrupt Organizations Act, intentional or
negligent infliction of emotional or mental distress, tortious interference with
corporate governments or prospective business advantage, tortious interference
with contractual relations, breach of contract, deceptive trade practices,
libel, slander, conspiracy, the charging, contracting for, taking, reserving,
collecting or receiving of interest in excess of the highest lawful rate
applicable to the Existing Loan Documents (i.e., usury), any violations of
federal or state law, any violations of federal or state banking rules, laws or
regulations, including, but not limited to, any violations of Regulation B,
Equal Credit Opportunity, bank tying act claims or any violation of federal
antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxxx X. Xxxxxx VP
------------------------------------
Name: XXXXXXX X. XXXXXX
Title: VICE PRESIDENT
[SIGNATURE PAGE TO THIRTEENTH AMENDMENT]
S-1
TWELFTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Twelfth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of October 15, 2003 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise
defined in this Amendment shall have the meanings respectively ascribed to
them in the Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Commitment. Section 2.1 (a) of the Loan Agreement is hereby
amended and restarted in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing,
Lender agrees, from time to time, during the period from the date
hereof to and including the Termination Date, to make Advances to
Company, provided the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed
$40,000,000; provided, however, commencing October 15, 2003 and
continuing through and including October 31, 2003, such amount shall
not exceed $45,000,000. The obligation of Lender to make Advances
hereunder up to such limit is hereinafter referred to as the
"Commitment." Within the Commitment, Company may borrow, repay and
reborrow. All Advances under this Agreement shall constitute a single
indebtedness, and all of the Collateral shall be security for the Note
and for the performance of all the Obligations of Company to Lender.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion
of the following conditions precedent (all agreements, documents and instruments
to be in form and substance satisfactory to Lender and Lender's counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and delivery by Company of an amended and restated
Promissory Note in the original principal amount of $45,000,000 ("Note");
(c) Delivery of an unanimous written consent from Company's member
authorizing the execution and delivery of this Amendment, the Note and the
transactions contemplated hereunder; and
(d) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
Note and the performance of the transactions herein contemplated (i) are and
will be within such party's powers, (ii) have been authorized by all necessary
organizational action, and (iii) are not and will not be in contravention of any
order of any court or other agency of government, of law or any other indenture,
agreement or undertaking to which Company is a party or by which the property of
Company is bound, or be in conflict with, result in a breach of, or constitute
(with due notice and or lapse of time) a default under any such indenture,
agreement or undertaking or result in the imposition of any lien, charge or
encumbrance of any nature on any of the properties of Company.
(c) This Amendment, the Note and any assignment, instrument, document,
or agreement executed and delivered in connection herewith, will be valid,
binding and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by company hereunder, Company RELEASES, RELINQUISHES
and forever DISCHARGES
2
Lender, and its predecessors, successors, assigns, shareholders, principals,
parents, subsidiaries, agents, officers, directors, employees, attorneys and
representatives (collectively, the "Released Parties"), of and from any and all
claims, demands, actions and causes of action of any and every kind or
character, whether known or unknown, present or future, which Company has, or
may have against Released Parties, arising out of or with respect to any and all
transactions relating to the Loan Agreement, the Note, and the other Existing
Loan Documents occurring prior to the date hereof, including any other loss,
expense and/or detriment, of any kind or character, growing out of or in any
way connected with or in any way resulting from the acts, actions or omissions
of the Released Parties, and including any loss, cost or damage in connection
with any breach of fiduciary duty breach of any duty of fair dealing, breach of
competence, breach of funding commitment, undue influence, duress, economic
coercion, conflict of interest, negligence, bad faith, malpractice, violations
of the Racketeer Influence and Corrupt Organizations Act, intentional or
negligent infliction of emotional or mental distress, tortious interference with
corporate governments or prospective business advantage, tortious interference
with contractual relations, breach of contract, deceptive trade practices,
libel, slander, conspiracy, the charging, contracting for, taking, reserving,
collecting or receiving of interest in excess of the highest lawful rate
applicable to the Existing Loan Documents (i.e., usury), any violations of
federal or state law, any violations of federal or state banking rules, laws or
regulations, including, but not limited to, any violations of Regulation B,
Equal Credit Opportunity, bank tying act claims or any violation of federal
antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Pres
NCL FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Pres
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxx B [Illegible]
------------------------------------
Name: XXXXXX B [Illegible]
Title: VICE PRESIDENT
[SIGNATURE PAGE TO TWELFTH AMENDMENT]
S-l
ELEVENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Eleventh Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of July 31, 2003 by First NLC Financial Services, LLC
and NLC Financial Services, LLC (collectively, the "Company"), and Washington
Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, promise
and agree as follows:
1. Amendment. The Loan Agreement is amended and modified in the following
manner:
(a) Definitions. The following definitions contained in Section 1.1 of
the Loan Agreement are amended and restated in their entirety as follows:
"Applicable Margin" shall mean [*] basis points for Aged Mortgage Loan
Advances and Advances against Repurchased Mortgage Loans and [*] basis
points for all other Advances.
"Termination Date" shall mean August 1, 2004 or such earlier date upon
which Lender's obligation to fund shall be terminated pursuant to the
terms of this Agreement.
(b) Wet Advance Sublimit. Section 2.1(b)(2) of the Loan Agreement is
amended and restated in its entirety as follows:
(2) The aggregate amount of Wet Settlement Advances outstanding at any
one time shall not exceed 35% of the Commitment.
(c) Advances. Section 2.1(c) of the Loan Agreement is amended and
restated in its entirety as follows:
(c) No Advance shall exceed the following amounts applicable to the
type of Collateral, determined as of the date the Collateral is
pledged to Lender. No Advance shall exceed (i) except as provided
below, an amount equal to [*] of the Collateral Value of such Mortgage
Loan; (ii) with respect to Subprime Mortgage Loans, an amount equal to
[*] of the Collateral Value of such Mortgage Loans; (iii) with respect
to Second Mortgage Loans, an amount equal to [*] of the Collateral
Value of such Mortgage Loans; (iv) with respect to Subwarehouse
Mortgage Loans, an amount equal to [*] of the Collateral Value of such
Subwarehouse Mortgage Loans until the earlier to occur of (X) the
termination of the Commitment hereunder and (Y) April 30, 2000; and
(v) with respect to Eligible Mortgage Loans subject to a Purchase
Commitment from Lender or any of Lender's affiliates, the lesser of
[*] of the Collateral Value of such Eligible Mortgage Loan or the
amount set forth in the applicable Purchase Commitment.
(d) Indebtedness to Tangible Net Worth Ratio. Section 7.5 of the Loan
Agreement is amended and restated in its entirely as follows:
7.5 Indebtedness to Tangible Net Worth Ratio. Permit to ratio of
Indebtedness to Tangible Net Worth of the Company (and its
Subsidiaries, on a consolidated basis) to exceed: (i) 20.0 to 1 as of
the end of each calendar through and including January 31, 2004 and
(ii) 15.0 to 1 as of the end of each calendar with thereafter.
(e) Minimum Adjusted Tangible Net Worth. Section 7.6 of the Loan
Agreement is amended and restated in its entirety as follows:
7.6 Minimum Adjusted Tangible Net Worth. Commencing with the calendar
month ending March 31, 2003, permit Adjusted Tangible Net Worth of the
Company (and its Subsidiaries, on a consolidated basis) to be less
than $10,400,000 as of the end of each calendar month.
(f) Current Ratio. Company shall not permit the Current Ratio of
Company (and its Subsidiaries, on a consolidated basis) to be less than (i) 1.03
to 1 as of the end of each calendar month through and including September 30,
2003 and (ii) 1.05 to 1 as of the end of each calendar month thereafter. For
purpose hereof, (x) "Current Assets" means, with respect to any Person, those
assets set forth on the consolidated balance sheet of a Person prepared in
accordance with GAAP, as current assets, defined as those assets that are now
cash or will be by their terms or disposition be converted to cash within one
year of the date of calculation, (y) "Current Liabilities" means, with respect
to any Person, those liabilities set forth on the consolidated balance sheet of
a
2
Person prepared in accordance with GAAP, as current liabilities, defined as
those liabilities due upon demand or within one year from the date of
calculation, and (z) "Current Ratio" means, with respect to any Person, the sum
of the amounts set forth in the consolidated balance sheet of the Person,
prepared in accordance with GAAP, on the date of calculation as Current Assets
divided by the sum of the amounts set forth on such consolidated balance sheet
as Current Liabilities.
(g) Limit on Distributions. The following is added to the end of
Section 7.8 of the Loan Agreement:
and (b) the Company must retain at least 20% of its net earnings after
all such dividends are paid.
(h) Mortgage Loan Cap. Notwithstanding anything to the contrary
contained in the Loan Agreement and in addition to such requirements for Second
Mortgage Loans and Subprime Mortgage Loans, no Eligible Mortgage shall be in a
maximum amount of greater than $1,000,000.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
performance of the transactions herein contemplated (i) are and will be within
such party's powers, (ii) have been authorized by all necessary organizational
action, and (iii) are not and will not be in contravention of any order of any
court or other agency of government, of law or any other indenture, agreement or
undertaking to which Company is a party or by which the property of Company is
bound, or be in conflict with, result in a breach of, or constitute (with due
notice and/or lapse of time) a default under any such indenture, agreement or
undertaking or result in the imposition of any lien, charge or encumbrance of
any nature on any of the properties of Company.
(c) This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
3
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company RELEASES, RELINQUISHES
and forever DISCHARGES Lender, and its predecessors, successors, assigns,
shareholders, principals, parents, subsidiaries, agents, officers, directors,
employees, attorneys and representatives (collectively, the "Released Parties"),
of and from any and all claims, demands, actions and causes of action of any and
every kind or character, whether known or unknown, present or future, which
Company has, or may have against Released Parties, arising out of or with
respect to any and all transactions relating to the Loan Agreement, the Note,
and the other Existing Loan Documents occurring prior to the date hereof,
including any other loss, expense and/or detriment, of any kind or character,
growing out of or in any way connected with or in any way resulting from the
acts, actions or omissions of the Released Parties, and including any loss, cost
or damage in connection with any breach of fiduciary duty, breach of any duty of
fair dealing, breach of competence, breach of funding commitment, undue
influence, duress, economic coercion, conflict of interest, negligence, bad
faith, malpractice, violations of the Racketeer Influence and Corrupt
Organizations Act, intentional or negligent infliction of emotional or mental
distress, tortious interference with corporate governments or prospective
business advantage, tortious interference with contractual relations, breach of
contract, deceptive trade practices, libel, slander, conspiracy, the charging,
contracting for, taking, reserving, collecting or receiving of interest in
excess of the highest lawful rate applicable to the Existing Loan Documents
(i.e., usury), any violations of federal or state law, any violations of federal
or state banking rules, laws or regulations, including, but not limited to, any
violations of Regulation B, Equal Credit Opportunity, bank tying act claims or
any violation of federal antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are ratified and confirmed and continue unchanged and in full force
and effect. All references to the Loan Agreement shall mean the Loan Agreement
as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
4
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
5
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Name: XXXX XXXXXXXX
Title: CEO
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Name: XXXX XXXXXXXX
Title: CEO
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxx X Xxxxxx
------------------------------------
Name: Xxxxxx X Xxxxxx
Title: Vice President
[SIGNATURE PAGE TO ELEVENTH AMENDMENT]
S-1
TENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Tenth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of May 30, 2003 by First NLC Financial Services, LLC
and NLC Financial Services, LLC (collectively, the "Company"), and Washington
Mutual Bank, FA, successor by merger to Bank Unit ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
promise and agree as follows:
1. Amendment. The Loan Agreement is hereby amended and modified in the
following manner:
(a) Termination Date. The definition of "Termination Date" contained
in Section 1.3 of the Loan Agreement is hereby amended and restated in its
entirety as follows:
"Termination Date" shall mean July 31, 2003 or such earlier date upon
which Lender's obligation to fund shall be terminated pursuant to the
terms of this Agreement.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b)Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
performance of the transactions herein contemplated (i) are and will be within
such party's powers, (ii) have been authorized by all necessary organizational
action, and (iii) are not and will not be in contravention of any order of any
court or other agency of government, of law or any other indenture, agreement or
undertaking to which Company is a party or by which the property of Company is
bound, or be in conflict with, result in a breach of, or constitute (with due
notice and/or lapse of time) a default under any such indenture, agreement or
undertaking or result in the imposition of any lien, charge or encumbrance of
any nature on any of the properties of Company.
(c) This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company hereby acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company hereby RELEASES,
RELINQUISHES and forever DISCHARGES Lender, and its predecessors, successors,
assigns, shareholders, principals, parents, subsidiaries, agents, officers,
directors, employees, attorneys and representatives (collectively, the "Released
Parties"), of and from any and all claims, demands, actions and causes of action
of any and every kind or character, whether known or unknown, present or future,
which Company has, or may have against Released Parties, arising out of or with
respect to any and all transactions relating to the Loan Agreement, the Note,
and the other Existing Loan Documents occurring prior to the date hereof,
including any other loss, expense and/or detriment, of any kind or character,
growing out of or in any way connected with or in any way resulting from the
acts, actions or omissions of the Released Parties, and including any loss, cost
or damage in connection with any of breach of fiduciary duty, breach of any duty
of fair dealing, breach of competence, breach of funding commitment, undue
influence, duress, economic coercion, conflict of interest, negligence, bad
faith, malpractice, violations of the Racketeer Influence and Corrupt
Organizations Act, intentional or negligent infliction of emotional or mental
distress, tortious interference with corporate governments or prospective
business advantage, tortious interference with contractual relations, breach of
contract, deceptive trade practices, libel, slander, conspiracy, the charging,
contracting for, taking, reserving, collecting or receiving of interest in
excess of the highest lawful rate applicable to the Existing Loan Documents
(i.e., usury), any violations of federal or state law, any violations of federal
or state banking rules, laws or regulations, including, but not limited to, any
of violations Regulation B, Equal Credit Opportunity, bank tying act claims or
any violation of federal an antitrust acts.
2
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are hereby ratified and confirmed and continue unchanged and in full
force and effect. All references to the Loan Agreement shall mean the Loan
Agreement as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above.
COMPANY:
FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: PRESIDENT
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: PRESIDENT
LENDER: WASHINGTON MUTUAL BANK, FA
By:
------------------------------------
Xxxxx X. Xxxxxx, Vice President
S-1
NINTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Ninth Amendment to Warehousing Credit and Security Agreement:
("Amendment") is dated as of April 30, 2003 by First NLC Financial Services, LLC
and NLC Financial Services, LLC (collectively, the "Company"), and Washington
Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Certain Events of Default have occurred under the Loan Agreement.
Company has requested that Lender waive the Existing Defaults (as defined
below), and modify in certain respects the Loan Agreement, and Lender has agreed
to such waiver and modifications subject to the terms and conditions of this
Amendment.
C. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
promise and agree as follows:
1. Amendment. The Loan Agreement is hereby amended and modified in the
following manner:
(a) Minimum Adjusted Tangible Net Worth. Section 7.6 of the Loan
Agreement is hereby amended and restated in its entirety as follows:
7.6 Minimum Adjusted Tangible Net Worth. Commencing with the calendar
month ending March 31, 2003, permit Adjusted Tangible Net Worth of the
Company (and its Subsidiaries, on a consolidated basis) to be less
than $11,000,000 as of the end of each calendar month.
2. Waiver of Existing Defaults. Company has informed Lender that Company
failed to comply with Section 7.6 of the Loan Agreement for the calendar months
ending January 31, 2003 and February 28, 2003. Each such failure to comply is an
Event of Default, and such failures are referred to collectively herein as,
"Existing Defaults." Upon satisfaction of the effectiveness conditions set forth
below, Lender shall be deemed to have waived the Existing Defaults, provided
that Lender's waiver shall not be deemed to be a waiver of any subsequent
violations of such covenant or a waiver of any other Events of Defaults which
may have occurred but are not specifically referred to herein. Nothing contained
herein shall obligate Lender to grant
any future waiver of any Event of Default.
3. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
(a) Execution and delivery by Company of this Amendment to Lender;
(b) Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
4. Representations and Warranties. Company represents and warrants to
Lender that:
(a) All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
(b) The execution and delivery by Company of this Amendment and the
performance of the transactions herein contemplated (i) are and will be within
such party's powers, (ii) have been authorized by all necessary organizational
action, and (iii) are not and will not be in contravention of any order of any
court or other agency of government, of law or any other indenture, agreement or
undertaking to which Company is a party or by which the property of Company is
bound, or be in conflict with, result in a breach of, or constitute (with due
notice and/or lapse of time) a default under any such indenture, agreement or
undertaking or result in the imposition of any lien, charge or encumbrance of
any nature on any of the properties of Company.
(c) This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
(d) No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
5. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company hereby acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company hereby RELEASES,
RELINQUISHES and forever DISCHARGES Lender, and its predecessors, successors,
assigns, shareholders, principals, parents, subsidiaries, agents, officers,
directors, employees, attorneys and representatives (collectively, the "Released
Parties"), of and from any and all claims, demands, actions and causes of action
of any and every kind or character, whether known or unknown,
2
present or future, which Company has, or may have against Released Parties,
arising out of or with respect to any and all transactions relating to the Loan
Agreement, the Note, and the other Existing Loan Documents occurring prior to
the date hereof, including any other loss, expense and/or detriment, of any kind
or character, growing out of or in any way connected with or in any way
resulting from the acts, actions or omissions of the Released Parties, and
including any loss, cost or damage in connection with any breach of fiduciary
duty, breach of any duty of fair dealing, breach of competence, breach of
funding commitment, undue influence, duress, economic coercion, conflict of
interest, negligence, bad faith, malpractice, violations of the Racketeer
Influence and Corrupt Organizations Act, intentional or negligent infliction of
emotional or mental distress, tortious interference with corporate governments
or prospective business advantage, tortious interference with contractual
relations, breach of contract, deceptive trade practices, libel, slander,
conspiracy, the charging, contracting for, taking, reserving, collecting or
receiving of interest in excess of the highest lawful rate applicable to the
Existing Loan Documents (i.e., usury), any violations of federal or state law,
any violations of federal or state banking rules, laws or regulations,
including, but not limited to, any violations of Regulation B, Equal Credit
Opportunity, bank tying act claims or any violation of federal antitrust acts.
6. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
7. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are hereby ratified and confirmed and continue unchanged and in full
force and effect. All references to the Loan Agreement shall mean the Loan
Agreement as modified by this Amendment.
8. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
9. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
3
Dated the date and year first written above.
COMPANY: FIRST NLC FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
NCL FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: PRESIDENT
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx, Vice President
S-1
EIGHTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Eighth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of November 1, 2002 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
promise and agree as follows:
1. Amendment. The Loan Agreement is hereby amended and modified in the
following manner:
a. Applicable Margin. The definition of "Applicable Margin" contained
in Section 1.1 of the Loan Agreement is hereby amended and restated in its
entirety as follows"
"Applicable Margin" shall mean [*] basis points.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
a. Execution and delivery by Company of this Amendment to Lender;
b. Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
a. All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
b. The execution and delivery by Company of this Amendment and the
performance of the transactions herein contemplated (i) are and will be within
such party's powers,
(ii) have been authorized by all necessary organizational action, and (iii) are
not and will not be in contravention of any order of any court or other agency
of government, of law or any other indenture, agreement or undertaking to which
Company is a party or by which the property of Company is bound, or be in
conflict with, result in a breach of, or constitute (with due notice and/or
lapse of time) a default under any such indenture, agreement or undertaking or
result in the imposition of any lien, charge or encumbrance of any nature on any
of the properties of Company.
c. This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
d. No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the ' obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company hereby acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company hereby RELEASES,
RELINQUISHES and forever DISCHARGES Lender, and its predecessors, successors,
assigns, shareholders, principals, parents, subsidiaries, agents, officers,
directors, employees, attorneys and representatives (collectively, the "Released
Parties"), of and from any and all claims, demands, actions and causes of action
of any and every kind or character, whether known or unknown, present or future,
which Company has, or may have against Released Parties, arising out of or with
respect to any and all transactions relating to the Loan Agreement, the Note,
and the other Existing Loan Documents occurring prior to the date hereof,
including any other loss, expense and/or detriment, of any kind or character,
growing out of or in any way connected with or in any way resulting from the
acts, actions or omissions of the Released Parties, and including any loss, cost
or damage in connection with any breach of fiduciary duty, breach of any duty of
fair dealing, breach of competence, breach of funding commitment, undue
influence, duress, economic coercion, conflict of interest, negligence, bad
faith, malpractice, violations of the Racketeer Influence and Corrupt
Organizations Act, intentional or negligent infliction of emotional or mental
distress, tortious interference with corporate governments or prospective
business advantage, tortious interference with contractual relations, breach of
contract, deceptive trade practices, libel, slander, conspiracy, the charging,
contracting for, taking, reserving, collecting or receiving of interest in
excess of the highest lawful rate applicable to the Existing Loan Documents
(i.e., usury), any violations of federal or state law, any violations of federal
or state banking rules, laws or regulations, including, but not limited to, any
violations of Regulation B, Equal Credit Opportunity, bank tying act claims or
any violation of federal antitrust acts.
2
5. Collateral. As security for the payment of die Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are hereby ratified and confirmed and continue unchanged and in full
force and effect. All references to the Loan Agreement shall mean the Loan
Agreement as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
SIGNATURES ON FOLLOWING PAGE
3
IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective duly authorized officers as of the date first above written.
COMPANY: FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Pres
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Pres
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxx
Title: FVP
4
SEVENTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Seventh Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of June 20th, 2002 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
promise and agree as follows:
1. Amendment. The Loan Agreement is hereby amended and modified in the
following manner:
a. Termination Date. The definition of "Termination Date" contained in
Section 1.1 of the Loan Agreement is hereby amended and restated in its entirety
as follows:
'Termination Date" shall mean May 30, 2003 or such earlier date upon
which Lender's obligation to fund shall be terminated pursuant to the
terms of this Agreement.
b. Repurchased Mortgage Loan. The following new definitions of
"Eligible Repurchased Mortgage Loan" and "Repurchased Mortgage Loan" are hereby
added to Section 1.1 of the Loan Agreement as follows:
"Eligible Repurchased Mortgage Loan" means a Repurchased Mortgage Loan
owned by Company that (a) is validly pledged to Lender, subject to no
other Liens; (b) meets all the requirements set forth in the
definition of an Eligible Mortgage Loan except for clauses (f), (g)
and (i); (c) was included in Collateral as an Eligible Mortgage Loan
prior to its pledge as an Eligible Repurchased Mortgage Loan; and (d)
shall not have been included in Collateral as an Eligible Repurchased
Mortgage Loan for more than an aggregate period of ninety (90) days.
"Repurchased Mortgage Loan" means a defaulted Mortgage Loan (a) that
Company is obligated to purchase from an Investor pursuant to a
Purchase Commitment between such Investor and Company or other
contractual obligation owed by Company to such Investor for any reason
other than fraud of Company or any other Person in the origination of
such Mortgage Loan or any incurable violation of the Real Estate
Settlement Procedures Act, Equal Credit Opportunity Act, the Federal
Truth-in-Lending Act or any other applicable laws and regulations in
the origination of such Mortgage Loans, and (b) for which foreclosure
proceedings have not been completed.
c. Commitment. Section 2.1 (a) of the Loan Agreement is hereby amended
and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing,
Lender agrees, from time to time, during the period from the date
hereof to and including the Termination Date, to make Advances to
Company, provided the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed
$40,000,000. The obligation of Lender to make Advances hereunder up to
such limit is hereinafter referred to as the "Commitment." Within the
Commitment, Company may borrow, repay and reborrow. All Advances under
this Agreement shall constitute a single indebtedness, and all of the
Collateral shall be security for the Note and for the performance of
all the Obligations of Company to Lender.
2. Repurchased Mortgage Loans. Company may obtain an Advance against an
Eligible Repurchased Mortgage Loan subject to the satisfaction of the conditions
set forth in Sections 2.1 of the Standard Provisions, upon compliance with the
procedures set forth in the Loan Agreement, the Standard Provisions and in
Exhibit A attached hereto and made a part hereof. Requests for Advances against
Eligible Repurchased Mortgage Loans shall be initiated by Company by delivering
to Lender and its designee, by facsimile (with original to be sent immediately
thereafter by overnight mail) a completed and signed request for an Advance in
the form of Exhibit B attached hereto and a part hereof ("Repurchased Advance
Request"). Company shall provided to Lender in connection with a Repurchased
Advance Request all documents listed in the Repurchased Advance Request. In no
event shall the aggregate amount of Advances against Repurchased Mortgage Loans
outstanding at any one time exceed $500,000. Notwithstanding anything to the
contrary contained in the Loan Agreement or the Standard Provisions, the unpaid
amount of each Advance outstanding against Repurchased Mortgage Loans shall bear
interest from the date of such Advance until paid in full, at a rate of interest
equal to the lesser of (a) the Maximum Rate or (b) a floating rate of interest
which is equal to [*] basis points per annum over the Reference Rate. No Advance
against a Repurchased Mortgage Loan shall exceed an amount equal to [*]% of the
Collateral Value of such Mortgage Loan as of the date of such Advance. Company
shall be obligated to pay to Lender, without the necessity of prior demand or
notice from Lender, and Company authorizes Lender to charge the Funding Account,
if any, or any other accounts of Company (excluding any monies held by Company
in trust for third parties) in
2
Lender's possession for the amount of any outstanding Advance against a
Repurchased Mortgage Loan upon the expiration of ninety (90) days from the date
of any Advance for any Repurchased Mortgage Loan.
3. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
a. Execution and delivery by Company and each Guarantor of this
Amendment to Lender;
b. Execution and delivery by Company of an amended and restated
Promissory Note in the original principal amount of $40,000,000 ("Note");
c. Delivery of an unanimous written consent from Company's member
authorizing the execution and delivery of this Amendment, the Note and the
transactions contemplated hereunder; and
d. Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
4. Representations and Warranties. Company represents and warrants to
Lender that:
a. All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
b. The execution and delivery by Company of this Amendment, the Note
and the performance by each of them of the transactions herein contemplated (i)
are and will be within such party's powers, (ii) have been authorized by all
necessary organizational action, and (iii) are not and will not be in
contravention of any order of any court or other agency of government, of law or
any other indenture, agreement or undertaking to which Company is a party or by
which the property of Company is bound, or be in conflict with, result in a
breach of, or constitute (with due notice and/or lapse of time) a default under
any such indenture, agreement or undertaking or result in the imposition of any
lien, charge or encumbrance of any nature on any of the properties of Company.
c. This Amendment, Note and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
d. No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
5. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan
3
Documents. Company hereby acknowledges, agrees, and represents that (a) there
are no claims or offsets against, or defenses or counterclaims to, the terms or
provisions of the Existing Loan Documents, and the other obligations created or
evidenced by the Existing Loan Documents; (b) Company has no claims, offsets,
defenses or counterclaims arising from any of Lender's acts or omissions with
respect to the Existing Loan Documents, or Lender's performance under the
Existing Loan Documents; and (c) Company promises to pay to the order of Lender
the indebtedness evidenced by the Note according to the terms thereof. In
consideration of the modification of certain provisions of the Existing Loan
Documents, all as herein provided, and the other benefits received by Company
hereunder, Company hereby RELEASES, RELINQUISHES and forever DISCHARGES Lender,
and its predecessors, successors, assigns, shareholders, principals, parents,
subsidiaries, agents, officers, directors, employees, attorneys and
representatives (collectively, the "Released Parties"), of and from any and all
claims, demands, actions and causes of action of any and every kind or
character, whether known or unknown, present or future, which Company has, or
may have against Released Parties, arising out of or with respect to any and all
transactions relating to the Loan Agreement, the Note, and the other Existing
Loan Documents occurring prior to the date hereof, including any other loss,
expense and/or detriment, of any kind or character, growing out of or in any way
connected with or in any way resulting from the acts, actions or omissions of
the Released Parties, and including any loss, cost or damage in connection with
any breach of fiduciary duty, breach of any duty of fair dealing, breach of
competence, breach of funding commitment, undue influence, duress, economic
coercion, conflict of interest, negligence, bad faith, malpractice, violations
of the Racketeer Influence and Corrupt Organizations Act, intentional or
negligent infliction of emotional or mental distress, tortious interference with
corporate governments or prospective business advantage, tortious interference
with contractual relations, breach of contract, deceptive trade practices,
libel, slander, conspiracy, the charging, contracting for, taking, reserving,
collecting or receiving of interest in excess of the highest lawful rate
applicable to the Existing Loan Documents (i.e., usury), any violations of
federal or state law, any violations of federal or state banking rules, laws or
regulations, including, but not limited to, any violations of Regulation B,
Equal Credit Opportunity, bank tying act claims or any violation of federal
antitrust acts.
6. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
7. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are hereby ratified and confirmed and continue unchanged and in full
force and effect. All references to the Loan Agreement shall mean the Loan
Agreement as modified by this Amendment.
8. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
9. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
4
SIGNATURES ON FOLLOWING PAGE
5
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed by their respective duly authorized officers as of the date first above
written.
COMPANY: FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
----------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: Exec Vice President
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
----------------------------------
Name: XXXXXXX XXXXXXXX
Title: Exec Vice President
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: XXXXXX XXXXXX
Title: First Vice President
6
EXHIBIT A
PROCEDURES AND DOCUMENTATION FOR WAREHOUSING REPURCHASED MORTGAGE LOANS
The following procedures and documentation requirements must be
observed in all respects by Company. All documents must be satisfactory to
Lender in its sole discretion. Terms used below, which are not otherwise
defined, shall have the meanings given them in the Loan Agreement.
Prior to making an Advance against Eligible Repurchased Mortgage
Loans, Lender must receive the following:
(1) Original Request for Advance ("Exhibit "B").
(2) Original signed Mortgage Note, endorsed by Company in blank with
corresponding interim endorsements, if applicable.
(3) Copy of the Mortgage certified by the escrow/title company or
closing agent.
(4) Certified true copies of all interim assignments (recorded or
sent for recordation) of the Mortgage.
(5) An Assignment of the Mortgage to Lender in recordable form but
unrecorded.
(6) Copy of the Demand Letter from the Investor requiring the
repurchase of the Repurchased Mortgage Loan and specifying the
reasons therefor.
EXHIBIT B
ADVANCE REQUEST - REPURCHASED MORTGAGE LOANS
Mortgage Company:
----------------------
Mortgagor:
-----------------------------
Prepared by:
---------------------------
Address:
-------------------------------
-------------------------------
Note Amount:
---------------
Note Date:
-----------------
Interest Rate:
-------------
Investors:
-----------------
Request Advance Amount:
------------------
METHOD OF ADVANCE
( ) Wire Transfer (see attached instructions)
REQUIRED DOCUMENTATION
(in addition to this Repurchase Advance Request)
Attached please find the following documents in connection with the above
request.
. Original Mortgage Note, endorsed in blank.
. Certified Copy of Mortgage.
. Recordable Assignment of Mortgage (in blank).
. All interim Assignments (if applicable).
. Demand Letter from Investor requiring repurchase of the
Repurchased Mortgage Loan and specifying the reasons therefore.
EXECUTED as of the day of
------- ----------------------, ----------
----------------------------------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
SIXTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Sixth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of September 28, 2001 by First NLC Financial Services,
LLC and NLC Financial Services, LLC (collectively, the "Company"), and
Washington Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
promise and agree as follows:
1. Amendment. The Loan Agreement is hereby amended and modified in the
following manner:
a. Commitment. Section 2.1 (a) of the Loan Agreement is hereby amended
and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing,
Lender agrees, from time to time, during the period from the date
hereof to and including the Termination Date, to make Advances to
Company, provided the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed
TWENTY-FIVE MILLION AND NO/100 DOLLARS ($25,000,000); provided,
however, for the period commencing August 1, 2001 and continuing
through and including October 31, 2001, the total aggregate principal
amount outstanding at any one time of all such Advances shall not
exceed THIRTY FIVE MILLION AND NO/100 DOLLARS ($35,000,000). The
obligation of Lender to make Advances hereunder up to such limit is
hereinafter referred to as the "Commitment." Within the Commitment,
Company may borrow, repay and reborrow. All Advances under this
Agreement shall constitute a single indebtedness, and all of the
Collateral shall be security for the Note and for the performance of
all the Obligations of Company to Lender.
-1-
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
a. Execution and delivery by Company and each Guarantor of this
Amendment to Lender;
b. Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
a. All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
b. The execution and delivery by Company of this Amendment and the
performance by each of them of the transactions herein contemplated (i) are and
will be within such party's powers, (ii) have been authorized by all necessary
organizational action, and (iii) are not and will not be in contravention of any
order of any court or other agency of government, of law or any other indenture,
agreement or undertaking to which Company is a party or by which the property of
Company is bound, or be in conflict with, result in a breach of, or constitute
(with due notice and/or lapse of time) a default under any such indenture,
agreement or undertaking or result in the imposition of any lien, charge or
encumbrance of any nature on any of the properties of Company.
c. This Amendment and any assignment, instrument, document, or
agreement executed and delivered in connection herewith, will be valid, binding
and enforceable in accordance with its respective terms.
d. No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company hereby acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company hereby RELEASES,
RELINQUISHES and forever DISCHARGES Lender, and its predecessors, successors,
assigns, shareholders, principals, parents, subsidiaries, agents, officers,
directors, employees, attorneys and
-2-
representatives (collectively, the "Released Parties"), of and from any and all
claims, demands, actions and causes of action of any and every kind or
character, whether known or unknown, present or future, which Company has, or
may have against Released Parties, arising out of or with respect to any and all
transactions relating to the Loan Agreement, the Note, and the other Existing
Loan Documents occurring prior to the date hereof, including any other loss,
expense and/or detriment, of any kind or character, growing out of or in any way
connected with or in any way resulting from the acts, actions or omissions of
the Released Parties, and including any loss, cost or damage in connection with
any breach of fiduciary duty, breach of any duty of fair dealing, breach of
competence, breach of funding commitment, undue influence, duress, economic
coercion, conflict of interest, negligence, bad faith, malpractice, violations
of the Racketeer Influence and Corrupt Organizations Act, intentional or
negligent infliction of emotional or mental distress, tortious interference with
corporate governments or prospective business advantage, tortious interference
with contractual relations, breach of contract, deceptive trade practices,
libel, slander, conspiracy, the charging, contracting for, taking, reserving,
collecting or receiving of interest in excess of the highest lawful rate
applicable to the Existing Loan Documents (i.e., usury), any violations of
federal or state law, any violations of federal or state banking rules, laws or
regulations, including, but not limited to, any violations of Regulation B,
Equal Credit Opportunity, bank tying act claims or any violation of federal
antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are hereby ratified and confirmed and continue unchanged and in full
force and effect. All references to the Loan Agreement shall mean the Loan
Agreement as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
SIGNATURES ON FOLLOWING PAGE
-3-
IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective duly authorized officers as of the date first above written.
COMPANY: FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: EVP
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: EVP
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx, Vice President -
Director
-4-
---------------------------------------
BANK UNITED MBF LEGAL FILE
Customer: First NLC
Reviewed By ___ Date: 8/17/01
___ PSA AGRMNT ___ INCORPORATION
[X] WAREHSE AGRMNT ___ INSURANCE
__ UCC _______________
__ GUARANTY
Other: 5th Amendment
---------------------------------------
FIFTH AMENDMENT TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
This Fifth Amendment to Warehousing Credit and Security Agreement
("Amendment") is dated as of August 1, 2001 by First NLC Financial Services, LLC
and NLC Financial Services, LLC (collectively, the "Company"), and Washington
Mutual Bank, FA, successor by merger to Bank United ("Lender").
BACKGROUND
A. Company and Lender are parties to a certain Warehousing Credit and
Security Agreement dated as of February 4, 2000 (as has been and may hereafter
be amended or modified from time to time, the "Loan Agreement") and related
agreements, instruments and documents (collectively, with the Loan Agreement,
the "Existing Loan Documents"). Capitalized terms used but not otherwise defined
in this Amendment shall have the meanings respectively ascribed to them in the
Loan Agreement.
B. Company has requested that Lender amend the Loan Agreement in certain
respects, all on the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
promise and agree as follows:
1. Amendment. The Loan Agreement is hereby amended and modified in the
following manner:
a. Commitment. Section 2.1 (a) of the Loan Agreement is hereby amended
and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing,
Lender agrees, from time to time, during the period from the date
hereof to and including the Termination Date, to make Advances to
Company, provided the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed
TWENTY-FIVE MILLION AND NO/100 DOLLARS ($25,000,000); provided,
however, for the period commencing August 1, 2001 and continuing
through and including September 15, 2001, the total aggregate
principal amount outstanding at any one time of all such Advances
shall not exceed THIRTY FIVE MILLION AND NO/100 DOLLARS ($35,000,000).
The obligation of Lender to make Advances hereunder up to such limit
is hereinafter referred to as the "Commitment." Within the Commitment,
Company may borrow, repay and reborrow. All Advances under this
-1-
Agreement shall constitute a single indebtedness, and all of the
Collateral shall be security for the Note and for the performance of
all the Obligations of Company to Lender.
b. Advances. Section 2.1(c) of the Loan Agreement is hereby amended
and restated in its entirety as follows:
(c) No Advance shall exceed the following amounts applicable to the
type of Collateral, determined as of the date the Collateral is
pledged to Lender. No Advance shall exceed: with respect to Subprime
Mortgage Loans, an amount equal to [*] of the Collateral Value of such
Mortgage Loans; with respect to Second Mortgage Loans, an amount equal
to [*] of the Collateral Value of such Mortgage Loans; with respect to
Subwarehouse Mortgage Loans, an amount equal to [*] of the Collateral
Value of such Subwarehouse Mortgage Loans until the earlier to occur
of (x) the termination of the Commitment hereunder and (y) April 30,
2000; and with respect to Eligible Mortgage Loans subject to a
Purchase Commitment from Lender or any of Lender's affiliates, the
lesser of [*] of the Collateral Value of such Eligible Mortgage Loan
or the amount set forth in the applicable Purchase Commitment.
2. Effectiveness Conditions. This Amendment shall be effective upon the
completion of the following conditions precedent (all agreements, documents and
instruments to be in form and substance satisfactory to Lender and Lender's
counsel):
a. Execution and delivery by Company and each Guarantor of this
Amendment to Lender;
b. Execution and delivery by Company of an amended and restated
Promissory Note in the original principal amount of $35,000,000 ("Note");
c. Delivery of an unanimous written consent from Company's member
authorizing the execution and delivery of this Amendment, the Note and the
transactions contemplated hereunder; and
d. Execution and/or delivery of all other agreements, instruments and
documents requested by Lender to effectuate and implement the terms hereof and
the Existing Loan Documents.
3. Representations and Warranties. Company represents and warrants to
Lender that:
-2-
a. All warranties and representations made to Lender under the Loan
Agreement and the Existing Loan Documents are true and correct as to the date
hereof.
b. The execution and delivery by Company of this Amendment, the Note
and the performance by each of them of the transactions herein contemplated (i)
are and will be within such party's powers, (ii) have been authorized by all
necessary organizational action, and (iii) are not and will not be in
contravention of any order of any court or other agency of government, of law or
any other indenture, agreement or undertaking to which Company is a party or by
which the property of Company is bound, or be in conflict with, result in a
breach of, or constitute (with due notice and/or lapse of time) a default under
any such indenture, agreement or undertaking or result in the imposition of any
lien, charge or encumbrance of any nature on any of the properties of Company.
c. This Amendment, the Note and any assignment, instrument, document,
or agreement executed and delivered in connection herewith, will be valid,
binding and enforceable in accordance with its respective terms.
d. No Event of Default or Default has occurred under the Loan
Agreement or any of the other Existing Loan Documents.
4. Representations and Release of Claims. Except as otherwise specified
herein, the terms and provisions hereof shall in no manner impair, limit,
restrict or otherwise affect the obligations of Company, or any third party to
Lender as evidenced by the Existing Loan Documents. Company hereby acknowledges,
agrees, and represents that (a) there are no claims or offsets against, or
defenses or counterclaims to, the terms or provisions of the Existing Loan
Documents, and the other obligations created or evidenced by the Existing Loan
Documents; (b) Company has no claims, offsets, defenses or counterclaims arising
from any of Lender's acts or omissions with respect to the Existing Loan
Documents, or Lender's performance under the Existing Loan Documents; and (c)
Company promises to pay to the order of Lender the indebtedness evidenced by the
Note according to the terms thereof. In consideration of the modification of
certain provisions of the Existing Loan Documents, all as herein provided, and
the other benefits received by Company hereunder, Company hereby RELEASES,
RELINQUISHES and forever DISCHARGES Lender, and its predecessors, successors,
assigns, shareholders, principals, parents, subsidiaries, agents, officers,
directors, employees, attorneys and representatives (collectively, the "Released
Parties"), of and from any and all claims, demands, actions and causes of action
of any and every kind or character, whether known or unknown, present or future,
which Company has, or may have against Released Parties, arising out of or with
respect to any and all transactions relating to the Loan Agreement, the Note,
and the other Existing Loan Documents occurring prior to the date hereof,
including any other loss, expense and/or detriment, of any kind or character,
growing out of or in any way connected with or in any way resulting from the
acts, actions or omissions of the Released Parties, and including any loss, cost
or damage in connection with any breach of fiduciary duty, breach of any duty of
fair dealing, breach of competence, breach of funding commitment, undue
influence, duress, economic coercion, conflict of interest, negligence, bad
faith, malpractice, violations of the Racketeer Influence and Corrupt
-3-
Organizations Act, intentional or negligent infliction of emotional or mental
distress, tortious interference with corporate governments or prospective
business advantage, tortious interference with contractual relations, breach of
contract, deceptive trade practices, libel, slander, conspiracy, the charging,
contracting for, taking, reserving, collecting or receiving of interest in
excess of the highest lawful rate applicable to the Existing Loan Documents
(i.e., usury), any violations of federal or state law, any violations of federal
or state banking rules, laws or regulations, including, but not limited to, any
violations of Regulation B, Equal Credit Opportunity, bank tying act claims or
any violation of federal antitrust acts.
5. Collateral. As security for the payment of the Company's Obligations
under the Loan Agreement, and satisfaction by Company of all covenants and
undertakings contained in the Loan Agreement and the Existing Loan Documents,
Company acknowledges Lender's prior security interest and lien in and to all of
the Collateral.
6. Ratification of Existing Loan Documents. Except as expressly set forth
herein, all of the terms and conditions of the Loan Agreement and Existing Loan
Documents are hereby ratified and confirmed and continue unchanged and in full
force and effect. All references to the Loan Agreement shall mean the Loan
Agreement as modified by this Amendment.
7. Governing Law. This Amendment shall be governed by, construed and
enforced in accordance with the laws of the State of Texas, excluding its
conflict of laws rules.
8. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original,
and such counterparts together shall constitute one and the same respective
agreement. Signature by facsimile shall also bind the parties hereto.
SIGNATURES ON FOLLOWING PAGE
-4-
IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective duly authorized officers as of the date first above written
COMPANY: FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: Exec Vice Pres
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: Exec Vice Pres
LENDER: WASHINGTON MUTUAL BANK, FA
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
Vice President
-5-
---------------------------------------
BANK UNITED MBF LEGAL FILE
Customer: __________________________
Reviewed By: ___ Date: 6/12/01
___ PSA AGRMNT ___ INCORPORATION
___ WAREHSE AGRMNT ___ INSURANCE
___ UCC ___ OPINION LTR
___ GUARANTY
Other: _____________________________
---------------------------------------
AMENDMENT NO. 4 TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
THIS AMENDMENT ("Amendment"), dated as of June 1, 2001, is by and among
FIRST NLC FINANCIAL SERVICES, LLC (f/k/a BANK NLC MORTGAGE LENDING, LLC) and NLC
FINANCIAL SERVICES, LLC, (collectively, the "Borrower") and WASHINGTON MUTUAL
BANK, FA, a federal association (as Lender).
BACKGROUND
A. The Borrower and Lender (f/k/a Bank United) are parties to that certain
Warehousing Credit and Security Agreement dated as of February 4, 2000 (as
amended from time to time, the "Agreement").
B. The Borrower and Lender desire to amend the Agreement to extend the
Termination Date and to make certain other changes set forth herein.
C. All capitalized terms used herein and not otherwise defined herein shall
have the meanings given to them in the Agreement.
NOW, THEREFORE, the foregoing Background Section being incorporated by
reference, the parties hereto agree as follows:
1. Section 1.1 is amended as follows with the replacement of the following
term:
""Termination Date" shall mean May 31, 2002."
2. Section 2.1 (a) is amended in its entirety as follows:
"Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing, the
Lender agrees, from time to time during the period from the date hereof to
and including the Termination Date, to make Advances to the Company,
provided the sum of the total aggregate principal amount outstanding at any
one time of all such Advances shall not exceed TWENTY FIVE MILLION DOLLARS
($25,000,000.00), provided that through and including July 31, 2001, such
amount shall not exceed THIRTY-FIVE MILLION DOLLARS ($35,000,000.00). The
obligation of the Lender to make Advances hereunder up to such limit is
hereinafter referred to as the "Commitment." Within the Commitment, the
Company may borrow, repay and reborrow. All Advances under this Agreement
shall constitute a single indebtedness, and all of the Collateral shall be
security for the Note and for the performance of all the Obligations of the
Company to the Lender."
3. Section 2.1 (c) is amended to add the following sentence:
"No Advance with respect to a Mortgage Loan subject to a Purchase
Commitment shall exceed an amount equal to [*] of the Collateral Value of such
Mortgage
Loan."
4. Section 7.6 is amended in its entirety as follows:
"7.6 Minimum Adjusted Tangible Net Worth. Permit Adjusted Tangible Net
Worth of the Company (and its Subsidiaries, on a consolidated basis) to be
less than (i) One Million, Five Hundred Thousand Dollars ($1,500,000.00)
computed as of September 30, 2000, and October 31, 2000, (ii) One Million,
Seven Hundred Fifty Thousand Dollars ($1,750,000.00) computed as of
November 30, 2000, (iii) Two Million Dollars ($2,000,000.00) computed as of
December 31, 2000, and as of the end of each calendar month thereafter
through and including the date this Amendment becomes effective, and (iv)
Three Million Six Hundred Thousand Dollars ($3,600,000.00) as of the date
of this Amendment becomes effective and at the end of each calendar month
thereafter. Beginning at the end of the calendar month following the month
in which this Amendment becomes effective, the Minimum Adjusted Tangible
Net Worth shall be increased by 50% of quarterly net income. Provided
Lender maintains the covenants set forth in this Agreement and is otherwise
not in Default, once the Adjusted Tangible Net Worth of the Company reaches
Five Million Dollars ($5,000,000.00), Borrower shall be permitted to pay
off the principal of the subordinated debt previously incurred by Borrower
with the written approval of Lender."
5. This Amendment shall only be effective upon Lender's receipt of the
following:
a) a copy of this Amendment No. 4 duly executed by the Borrower;
b) an original Amended and Restated Promissory Note (the "Note") in
the form attached hereto as Exhibit A;
c) evidence acceptable to Lender in its sole discretion that the
Borrower has taken all necessary corporate action to authorize
the execution of this Amendment and any other document executed
in connection herewith;
d) The Borrower shall have paid all fees, expenses and costs due to
or advanced by Lender through the date hereof.
6. The Borrower has advised Lender that Defaults have occurred under
Sections 7.5 and 7.6 of the Agreement for the period ending March 31, 2001 due
to Borrower's failure to comply with the financial covenants set forth therein
during such period. Upon the date on which this Amendment becomes effective,
Lender hereby waives the Borrower's Events of Default described in the foregoing
sentence (the "Existing Defaults"). The waiver of the Existing Defaults set
forth above is limited to the express terms thereof, and nothing herein shall be
deemed to be a waiver of by Lender of any other term, condition, representation
or covenant applicable to the Borrower under the Agreement (including but not
limited to any future occurrence similar to the Existing Defaults) or any of the
other agreements, documents or the covenants described therein. The waivers set
forth herein shall not constitute a waiver by the Lender of any other Event of
Default or noncompliance by Borrower, if any, under the Agreement, and shall not
be, and shall not be deemed to be, a course of action with respect thereto upon
which the Borrower may rely in the future, and the Borrower hereby expressly
waives any claim to such effect.
-2-
7. The Borrower hereby ratifies and reaffirms the representations and
warranties set forth in Article V of the Agreement as being true and correct as
of the date hereof.
8. The Borrower acknowledges, represents, warrants and agrees that (i) the
Borrower's Obligations to Lender and liens granted to secure such Obligations
are valid and perfected in accordance with applicable law; (ii) the Borrower's
Obligations to Lender are not subject to any setoff, defense, claim,
counterclaim, recoupment, or avoidance and/or subordination under the Bankruptcy
Code or otherwise; and (iii) the Borrower holds no claims against Lender, its
officers, agents, directors, representatives, attorneys, or any of their
respective heirs, successors and assigns (collectively, the "Lender Parties")
with respect to the Loan Documents. To the extent that the Borrower holds any
claims against one of more of the Lender Parties, arising under the Loan
Documents and extension of credit or administration thereof, collection of
amounts due thereunder, or any applications, discussions, as consideration for
Lender's undertakings under the Agreement or this Amendment, the Borrower hereby
unconditionally forever releases, discharges, and acquits the Lender Parties of
any and all claims, breaches of contract, debts, suits, demands, causes of
actions and actions of any type or notice which arose or are based on
occurrences or transactions which took place prior to the date of this
Amendment, whether known or unknown, contingent or liquidated, suspected or
unsuspected, at law or in equity, or based in contract or tort. The Borrower
acknowledges and represents that it has received the advice of counsel in
connection with this acknowledgment and release and has voluntarily entered into
this acknowledgement and release.
9. Except as amended hereby, all of the terms and conditions of the
Agreement and the obligations of the Borrower under the Note are ratified and
confirmed, and the Agreement shall continue in full force and effect in
accordance with its terms.
10. This Amendment may be executed in counterparts, all of which
counterparts, when taken together, will constitute the entire agreement.
- 3 -
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date set forth above.
FIRST NLC FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Its EVP
NLC FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Its EVP
WASHINGTON MUTUAL BANK, FA
By /s/ Illegible
-------------------------------------
Its Vice President
- 4 -
EXHIBIT A
AMENDED AND RESTATED PROMISSORY NOTE
$35,000,000.00 Xxxxxxx, Xxxxx , 0000
-------------
FOR VALUE RECEIVED, the undersigned, FIRST NLC FINANCIAL SERVICES, LLC
(f/k/a BANC NLC MORTGAGE LENDING, LLC), a Florida limited liability company and
NLC FINANCIAL SERVICES, LLC, jointly and severally (herein called the
"Borrower"), hereby promises to pay to the order of WASHINGTON MUTUAL BANK, FA,
a federal association, (the "Lender" or, together with its successors and
assigns, the "Holder") whose principal place of business is 0000 Xxxxxxxxx
Xxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, ATTN: Mortgage Banker Finance, or at
such other place as the Holder may designate from time to time, the principal
sum of THIRTY-FIVE MILLION AND NO/100 DOLLARS ($35,000,000.00) or so much
thereof as may be outstanding from time to time pursuant to the Warehousing
Credit and Security Agreement (the "Agreement") dated as of February 4, 2000
between the Borrower and the Lender, as the same has been amended and
supplemented or may be amended or supplemented from time to time, and to pay
interest on said principal sum or such part thereof as shall remain unpaid from
time to time, from the date of each Advance until repaid in full, and all other
fees and charges due under the Agreement, at the rate and at the times set forth
in the Agreement. All payments hereunder shall be made in lawful money of the
United States and in immediately available funds.
This Note is given to evidence an actual warehouse line of credit in the
above amount and is the Note referred to in the Agreement, and is entitled to
the benefits thereof. Reference is hereby made to the Agreement (which is
incorporated herein by reference as fully and with the same effect as if set
forth herein at length) for a description of the Collateral, required payments
of principal and interest on this Note, a statement of the covenants and
agreements, a statement of the rights and remedies and securities afforded
thereby and other matters contained therein. Capitalized terms used herein,
unless otherwise defined herein, shall have the meanings given them in the
Agreement.
This Note is given in replacement of that certain February 4, 2000
promissory note executed by the Borrower in the original principal sum of
$25,000,000 (the "Prior Note") and as subsequently amended and restated. All
liens, security interests and assignments securing the Prior Note and any other
note under the Agreement are hereby ratified, confirmed, renewed, extended and
carried forward as security for the repayment of this Note, in addition to and
cumulative of all other security.
The entire unpaid principal balance of this Note plus all accrued and
unpaid interest shall be due and payable in full on May 31, 2002 or such earlier
date set forth in the Agreement.
This Note may be prepaid in whole or in part at any time without premium or
penalty.
- 5 -
Should this Note be placed in the hands of attorneys for collection, the
Borrower agrees to pay, in addition to principal and interest, fees and charges
due under the Agreement, and all costs of collecting this Note, including
reasonable attorneys' fees and expenses.
This Note shall be construed and enforced in accordance with the laws of
the State of Texas, without reference to its principles of conflicts of law, and
applicable federal laws of the United States of America.
This Note is secured by all security agreements, collateral assignments,
deeds of trust and lien instruments executed by the Borrower in favor of Lender,
or executed by any other Person as security for this Note, including any
executed prior to, simultaneously with, or after the date of this Note and
including, without limitation, the Security Documents.
The Borrower and any and each co-maker, guarantor, accommodation party,
endorser or other Person liable for the payment or collection of this Note
expressly waive notice, presentment, demand for payment, protest, notice of
protest and non-payment or dishonor, notice of acceleration, notice of intent to
accelerate, notice of intent to demand, bringing of suit, and diligence in
taking any action to collect amounts called for hereunder and in the handling of
Collateral at any time existing as security in connection herewith, and shall be
directly and primarily liable for the payment of all sums owing and to be owing
hereon, regardless of and without any notice, diligence, act or omission as or
with respect to the collection of any amount called for hereunder or in
connection with any Lien at any time had or existing as security for any amount
called for hereunder.
It is the intention of the parties hereto to conform strictly to usury laws
applicable to the Lender. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law (including the laws of the United States
of America and the State of Texas), then, in that event, notwithstanding
anything to the contrary herein or in the Agreement or in any other Loan
Document or agreement entered into in connection with or as security for this
Note, it is agreed as follows: (i) the aggregate of all consideration which
constitutes interest under law applicable to the Lender that is contracted for,
taken, reserved, charged, or received herein or under the Agreement or under any
of the other aforesaid Loan Documents or agreements or otherwise in connection
herewith shall under no circumstances exceed the maximum amount allowed by such
applicable law, and any excess shall be credited by the Lender on the principal
amount of the Obligations (or, if the principal amount of the Obligations shall
have been paid in full, refunded by the Lender to the Borrower, as required);
and (ii) in the event that the maturity of this Note is accelerated by reason of
an election of the required or permitted prepayment, then such consideration
that constitutes interest under law applicable to the Lender may never include
more than the maximum amount allowed by such applicable law, and excess
interest, if any, provided for in the Agreement or otherwise shall be canceled
automatically as of the date of such acceleration or prepayment and, if
theretofore paid, shall be credited by the Lender on the principal amount of the
Obligations (or, if the principal amount of the Obligations shall have been paid
in full, refunded by the Lender to the Borrower, as required). Without limiting
the foregoing, all calculations of the rate of interest taken, reserved,
contracted for, charged, received or provided for under this Note or any of the
Loan Documents which are made for the purpose of determining whether the
interest rate exceeds the Maximum Rate shall be made, to the extent
-6-
allowed by law, by amortizing, prorating, allocating and spreading in equal
parts during the period of the full stated term of the loan evidenced hereby,
all interest at any time taken, reserved, contracted for, charged, received, or
provided for under this Note or any of the Loan Documents. To the extent that
the Section 303 of the Texas Finance Code is relevant for purposes of
determining the Maximum Rate, the Lender hereby elects to determine the
applicable rate ceiling under such statute by the weekly rate ceiling from time
to time in effect, subject to the Lender's right subsequently to change such
method in accordance with applicable law.
FIRST NLC FINANCIAL SERVICES, LLC
By:
------------------------------
Name:
Title:
NLC FINANCIAL SERVICES, LLC
By:
------------------------------
Name:
Title:
-7-
---------------------------------------
BANK UNITED MBF LEGAL FILE
Customer: __________________________
Reviewed By: ___ Date: 2/2/01
___ PSA AGRMNT ___ INCORPORATION
___ WAREHSE AGRMNT ___ INSURANCE
___ UCC ___ OPINION LTR
___ GUARANTY
amendment#3
_________
Other: _____________________________
---------------------------------------
AMENDMENT NO. 3 TO
WAREHOUSING CREDIT AND SECURITY AGGREMENT
THIS AMENDMENT ("Amendment"), dated as of February 2001 is by and among
FIRST NCL FINANCIAL SERVICES, LLC (f/k/a BANK NCL MORTGAGE LENDING, LLC) and
NCL FINANCIAL SERVICES, LLC, (collectively, the "Borrower") and BANK UNITED, a
federal savings bank (as Lender).
BACKGROUND
A. The Borrower and Lender are parties to that certain Warehousing Credit
and Security Agreement dated as of February 4, 2000 (as amended from time to
time, the "Agreement")
B. The Borrower and Lender desire to amend the Agreement to extend the
Termination Date and re-establish the original size of the Commitment as set
forth herein.
C. All capitalized terms used herein and not otherwise defined herein shall
have the meanings given to them in the Agreement.
NOW, THEREFORE, the foregoing Background Section being incorporated by
reference, the parties hereto agree as follows:
1. Section 2.1 (a) is amended in its entirety as follows:
Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occurred and is continuing, the
Lenders agrees, from time to time during the period from the date hereof to
and including the Termination Date, to make Advances to the Company,
provided the sum of the total aggregate principal amount outstanding at any
one of all such Advances shall not exceed TWENTY-FIVE MILLION AND NO/100
DOLLARS ($25,000,000.00). The obligation of the Lender to make Advances
hereunder up to such limit is herein after referred to as the "Commitment."
Within the Commitment, the Company may borrow, repay and reborrow. All
Advances under this Agreement shall constitute a single indebtedness, and
all of the collateral shall be security for the Note and for the
performance of all the Obligation of the Company to the Lender.
2. Section 1.1, the definition of "Termination Date" is amended in its
entirely as follows:
"Termination Date" shall mean April 30, 2001, or such earlier date
upon which Lender's obligation to fund shall be terminated pursuant to the
terms of this Agreement."
3. This Amendment shall only be effective upon Lender's receipt of the
following:
a) a copy of this Amendment No. 3 duly executed by the
Borrower;
b) an original Amended and Restated Promissory Note (the
"Note") in the form attached hereto as Exhibit A;
c) evidence acceptable to Lender in its sole discretion that
the Borrower has taken all necessary corporate action to
authorize the execution of this Amendment and any other
document executed in connection herewith;
d) The Borrower shall have paid all fees, expenses and costs
due to or advanced by Lender through the date hereof.
4. The Borrower hereby ratifies and reaffirms the representations and
warranties set forth in Article V of the Agreement as being true and correct as
of the date hereof.
5. The Borrower acknowledges, represents, warrants and agrees that (i) the
Borrower's Obligations to Lender and liens granted to secure such Obligations
are valid and perfected in accordance with applicable law; (ii) the Borrower's
Obligations to Lender are not subject to any setoff, defense, claim,
counterclaim, recoupment, or avoidance and/or subordination under the Bankruptcy
Code or otherwise; and (iii) the Borrower holds no claims against Bank United,
its officers, agents, directors, representatives, attorneys, or any of their
respective heirs, successors and assigns (collectively, the "Lender Parties")
with respect to the Loan Documents. To the extent that the Borrower holds any
claims against one of more of the Lender Parties, arising under the Loan
Documents and extension of credit or administration thereof, collection of
amounts due thereunder, or any applications, discussions, as consideration for
Lender's undertakings under the Agreement or this Amendment, the Borrower hereby
unconditionally forever releases, discharges, and acquits the Lender Parties of
any and all claims, breaches of contract, debts, suits, demands, causes of
actions and actions of any type or notice which arose or are based on
occurrences or transactions which took place prior to the date of this
Amendment, whether known or unknown, contingent or liquidated, suspected or
unsuspected, at law or in equity, or based in contract or tort. The Borrower
acknowledges and represents that it has received the advice of counsel in
connection with this acknowledgment and release and has voluntarily entered into
this acknowledgement and release.
6. Except as amended hereby, all of the terms and conditions of the
Agreement and the obligations of the Borrower under the Note are ratified and
confirmed, and the Agreement shall continue in full force and effect in
accordance with its terms.
7. This Amendment may be executed in counterparts, all of which
counterparts, when taken together, will constitute the entire agreement.
- 2 -
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date set forth above.
FIRST NLC FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Its Exec Vice Pres
NLC FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Its Exec Vice Pres
BANK UNITED
By /s/ Illegible
-------------------------------------
Its VP
- 3 -
EXHIBIT A
AMENDED AND RESTATED PROMISSORY NOTE
$25,000,000.00 Houston, Texas As first issued on February 4,
2000 and reissued on
February 1,2001
FOR VALUE RECEIVED, the undersigned, FIRST NLC FINANCIAL SERVICES, LLC
(f/k/a BANC NLC MORTGAGE LENDING, LLC), a Florida limited liability company and
NLC FINANCIAL SERVICES, LLC, jointly and severally (herein called the
"Borrower"), hereby promises to pay to the order of BANK UNITED, a federal
savings bank (the "Lender" or, together with its successors and assigns, the
"Holder") whose principal place of business is 0000 Xxxxxxxxx Xxxxxxx, Xxxxx
0000, Xxxxxxx, Xxxxx 00000, ATTN: Mortgage Banker Finance, or at such other
place as the Holder may designate from time to time, the principal sum of
TWENTY-FIVE MILLION AND NO/100 DOLLARS ($25,000,000.00) or so much thereof as
may be outstanding from time to time pursuant to the Warehousing Credit and
Security Agreement (the "Agreement") dated as of February 4, 2000 between the
Borrower and the Lender, as the same has been amended and supplemented or may be
amended or supplemented from time to time, and to pay interest on said principal
sum or such part thereof as shall remain unpaid from time to time, from the date
of each Advance until repaid in full, and all other fees and charges due under
the Agreement, at the rate and at the times set forth in the Agreement. All
payments hereunder shall be made in lawful money of the United States and in
immediately available funds.
This Note is given to evidence an actual warehouse line of credit in the
above amount and is the Note referred to in the Agreement, and is entitled to
the benefits thereof. Reference is hereby made to the Agreement (which is
incorporated herein by reference as fully and with the same effect as if set
forth herein at length) for a description of the Collateral, required payments
of principal and interest on this Note, a statement of the covenants and
agreements, a statement of the rights and remedies and securities afforded
thereby and other matters contained therein. Capitalized terms used herein,
unless otherwise defined herein, shall have the meanings given them in the
Agreement.
This Note is given in replacement of that certain February 4, 2000
promissory note executed by the Borrower in the original principal sum of
$25,000,000 (the "Prior Note"). All liens, security interests and assignments
securing the Prior Note and any other note under the Agreement are hereby
ratified, confirmed, renewed, extended and carried forward as security for the
repayment of this Note, in addition to and cumulative of all other security.
The entire unpaid principal balance of this Note plus all accrued and
unpaid interest shall be due and payable in full on May 30, 2001 or such earlier
date set forth in the Agreement.
This Note may be prepaid in whole or in part at any time without premium or
penalty.
- 4 -
Should this Note be placed in the hands of attorneys for collection, the
Borrower agrees to pay, in addition to principal and interest, fees and charges
due under the Agreement, and all costs of collecting this Note, including
reasonable attorneys' fees and expenses.
This Note shall be construed and enforced in accordance with the laws of
the State of Texas, without reference to its principles of conflicts of law, and
applicable federal laws of the United States of America.
This Note is secured by all security agreements, collateral assignments,
deeds of trust and lien instruments executed by the Borrower in favor of Lender,
or executed by any other Person as security for this Note, including any
executed prior to, simultaneously with, or after the date of this Note and
including, without limitation, the Security Documents.
The Borrower and any and each co-maker, guarantor, accommodation party,
endorser or other Person liable for the payment or collection of this Note
expressly waive notice, presentment, demand for payment, protest, notice of
protest and non-payment or dishonor, notice of acceleration, notice of intent to
accelerate, notice of intent to demand, bringing of suit, and diligence in
taking any action to collect amounts called for hereunder and in the handling of
Collateral at any time existing as security in connection herewith, and shall be
directly and primarily liable for the payment of all sums owing and to be owing
hereon, regardless of and without any notice, diligence, act or omission as or
with respect to the collection of any amount called for hereunder or in
connection with any Lien at any time had or existing as security for any amount
called for hereunder.
It is the intention of the parties hereto to conform strictly to usury laws
applicable to the Lender. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law (including the laws of the United States
of America and the State of Texas), then, in that event, notwithstanding
anything to the contrary herein or in the Agreement or in any other Loan
Document or agreement entered into in connection with or as security for this
Note, it is agreed as follows: (i) the aggregate of all consideration which
constitutes interest under law applicable to the Lender that is contracted for,
taken, reserved, charged, or received herein or under the Agreement or under any
of the other aforesaid Loan Documents or agreements or otherwise in connection
herewith shall under no circumstances exceed the maximum amount allowed by such
applicable law, and any excess shall be credited by the Lender on the principal
amount of the Obligations (or, if the principal amount of the Obligations shall
have been paid in full, refunded by the Lender to the Borrower, as required);
and (ii) in the event that the maturity of this Note is accelerated by reason of
an election of the required or permitted prepayment, then such consideration
that constitutes interest under law applicable to the Lender may never include
more than the maximum amount allowed by such applicable law, and excess
interest, if any, provided for in the Agreement or otherwise shall be canceled
automatically as of the date of such acceleration or prepayment and, if
theretofore paid, shall be credited by the Lender on the principal amount of the
Obligations (or, if the principal amount of the Obligations shall have been paid
in full, refunded by the Lender to the Borrower, as required). Without limiting
the foregoing, all calculations of the rate of interest taken, reserved,
contracted for, charged, received or provided for under this Note or any of the
Loan Documents which are made for the purpose of determining whether the
interest rate exceeds the Maximum Rate shall be made, to the extent
-5-
allowed by law, by amortizing, prorating, allocating and spreading in equal
parts during the period of the full stated term of the loan evidenced hereby,
all interest at any time taken, reserved, contracted for, charged, received, or
provided for under this Note or any of the Loan Documents. To the extent that
the Section 303 of the Texas Finance Code is relevant for purposes of
determining the Maximum Rate, the Lender hereby elects to determine the
applicable rate ceiling under such statute by the weekly rate ceiling from time
to time in effect, subject to the Lender's right subsequently to change such
method in accordance with applicable law.
FIRST NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Exec. Vice President
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Exec. Vice President
-6-
---------------------------------------
BANK UNITED MBF LEGAL FILE
Customer: ___________________________
Reviewed By: ___ Date: 12/13/00
___ PSA AGRMNT ___ INCORPORATION
___ WAREHSE AGRMNT ___ INSURANCE
___ UCC ___ OPINION LTR
___ GUARANTY
Other: _____________________________
---------------------------------------
AMENDMENT NO. 2 TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
THIS AMENDMENT ("Amendment"), dapted as of December 7, 2000, is by and
among FIRST NLC FINANCIAL SERVICES, LLC (f/k/a BANK NLC MORTGAGE LENDING, LLC)
and NLC FINANCIAL SERVICES, LLC, (collectively, the "Borrower") and BANK UNITED,
a federal savings bank (as Lender).
BACKGROUND
A. The Borrower and Lender are parties to that certain Warehousing Credit
and Security Arrangement dated as of February 4, 2000 (as amended by Amendment
Number 1 dated as of September 25, 2000 and as amended from time to time, the
"Agreement").
B. The Borrower and Lender desire to amend the Agreement as set forth
herein.
C. All capitalized terms used herein and not otherwise defined herein shall
have the meanings given to them in the Agreement.
NOW, THEREFORE, the foregoing Background Section being incorporated by
reference, the parties hereto agree as follows:
1. Section 2.1(a) is amended in its entirety as follows:
Subject to the terms and conditions of this Agreement and provided
that no Default or Event of Default has occured and is continuing, the
Lender agrees, from time to time during the period from the date hereof to
and including the Termination Date, to make Advances to the Company,
provided the sum of the total aggregate principal amount outstanding at any
one time of all such Advances shall not exceed THIRTY-FIVE MILLION AND
NO/100 DOLLARS ($35,000,000.00). The obligation of the Lender to make
Advance hereunder up to such limit is hereinafter referred to as the
"Commitment." Within the Commitment, the Company may borrow, repay and
reborrow. All Advances under this Agreement shall constitute a single
indebtedness, and all of the Collateral shall be security for the Note and
for the performance of all the Obligations of the Company to the Lender.
2. Section 7.5 is amended in its entirety as follows:
7.5 Indebtedness to Tangible Net Worth Ratio. Permit the ratio of
Indebtedness to Tangible Net Worth of the Company (and its Subsidiaries, on
a consolidated basis) to exceed: (i) 18:1 at September 30, 2000 and October
31, 2000, (ii) 16:1 at November 30, 2000, and (iii) 15:1 at December 31,
2000 and at the end of each calendar month thereafter.
3. Section 7.6 is amended in its entirety as follows:
7.6 Minimum Adjusted Tangible Net Worth. Permit Adjusted Tangible Net
Worth of the Company (and its Subsidiaries, on a consolidated basis) to be
less than (i) One Million, Five Hundred Thousand Dollars ($1,500,000.00)
computed as of September 30, 2000, and October 31, 2000, (ii) One Million,
Seven Hundred Fifty Thousand Dollars ($1,750,000,000.00) computed as of
November 30, 2000, (iii) Two Million Dollars ($2,000,000.00) computed as of
December 31, 2000, and as of the end of each calendar month thereafter
through and including May 31, 2000, and (iv) Two Million Two Hundred Fifty
Thousand Dollars ($2,250,000.00) as of June 30, 2001 and at the end of each
calendar month thereafter.
4. The second sentence of Section 2.3 is amended in its entirety as
follows:
"The term "Note" shall include all extensions, renewals and modifications
of the Note, the Supplemental Note (as defined herein) and all
substitutions therefor."
5. This Amendment shall only be effective upon Lender's receipt of the
following:
a) a copy of this Amendment No. 2 duly executed by the Borrower;
b) an original Borrowers Supplemental Note (the "Supplemental Note")
in the form attached hereto as Exhibit A;
c) evidence acceptable to Lender in its sole discretion that the
Borrower has taken all necessary corporate action to authorize
the execution of this Amendment and any other document executed
in connection herewith;
d) The Borrower shall have paid all fees, expenses and costs due to
or advanced by Lender through the date hereof.
6. The Borrower hereby ratifies and reaffirms the representations and
warranties set forth in Article V of the Agreement as being true and correct as
of the date hereof.
7. The Borrower acknowledges, represents, warrants and agrees that (i) the
Borrower's Obligations to Lender and liens granted to secure such Obligations
are valid and perfected in accordance with applicable law; (ii) the Borrower's
Obligations to Lender are not subject to any setoff, defense, claim,
counterclaim, recoupment, or avoidance and/or subordination under the Bankruptcy
Code or otherwise; and (iii) the Borrower holds no claims against Bank United,
its officers, agents, directors, representatives, attorneys, or any of their
respective heirs, successors and assigns (collectively, the "Lender Parties")
with respect to the Loan Documents. To the extent that the Borrower holds any
claims against one of more of the Lender Parties, arising under the Loan
Documents and extension of credit or administration thereof, collection of
amounts due thereunder, or any applications, discussions, as consideration for
Lender's undertakings under the Agreement or this Amendment, the Borrower hereby
unconditionally forever releases, discharges, and acquits the Lender Parties of
any and all claims, breaches of contract, debts, suits, demands, causes of
actions and actions of any type or notice which arose or are based on
occurrences or transactions which took place prior to the date of this
Amendment, whether known or unknown, contingent or liquidated, suspected or
unsuspected, at law or in equity, or based in contract or tort. The Borrower
acknowledges and represents that it
-2-
has received the advice of counsel in connection with this acknowledgment and
release and has voluntarily entered into this acknowledgement and release.
8. Except as amended hereby, all of the terms and conditions of the
Agreement and the obligations of the Borrower under the Note are ratified and
confirmed, and the Agreement shall continue in full force and effect in
accordance with its terms.
9. This Amendment may be executed in counterparts, all of which
counterparts, when taken together, will constitute the entire agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date set forth above.
FIRST NCL FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
------------------------------
Its EVP
NCL FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
------------------------------
Its Illegible
BANK UNITED
By /s/ Illegible
------------------------------
Its Vice President - Director
-3-
EXHIBIT A
SUPPLEMENTAL PROMISSORY NOTE
$10,000,000.00 Houston, Texas As of December , 2000
FOR VALUE RECEIVED, the undersigned, BANK NLC MORTGAGE LENDING, LLC, a
Florida limited liability company and NLC FINANCIAL SERVICES, LLC, jointly and
severally (herein called the "Borrower"), hereby promises to pay to the order of
BANK UNITED, a federal savings bank (the "Lender" or, together with its
successors and assigns, the "Holder") whose principal place of business is 0000
Xxxxxxxxx Xxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, ATTN: Mortgage Banker
Finance, or at such other place as the Holder may designate from time to time,
the principal sum of TEN MILLION AND NO/100 DOLLARS ($10,000,000.00) or so much
thereof as may be outstanding from time to time pursuant to the Warehousing
Credit and Security Agreement (the "Agreement") dated of even date herewith
between the Borrower and the Lender, as the same has been amended and
supplemented or may be amended or supplemented from time to time, and to pay
interest on said principal sum or such part thereof as shall remain unpaid from
time to time, from the date of each Advance until repaid in full, and all other
fees and charges due under the Agreement, at the rate and at the times set forth
in the Agreement. All payments hereunder shall be made in lawful money of the
United States and in immediately available funds.
This Note is given to evidence an actual warehouse line of credit in the
above amount and is the Note referred to in the Agreement, and is entitled to
the benefits thereof. Reference is hereby made to the Agreement (which is
incorporated herein by reference as fully and with the same effect as if set
forth herein at length) for a description of the Collateral, required payments
of principal and interest on this Note, a statement of the covenants and
agreements, a statement of the rights and remedies and securities afforded
thereby and other matters contained therein. Capitalized terms used herein,
unless otherwise defined herein, shall have the meanings given them in the
Agreement.
The entire unpaid principal balance of this Note plus all accrued and
unpaid interest shall be due and payable in full on January 31, 2001.
This Note may be prepaid in whole or in part at any time without premium or
penalty.
Should this Note be placed in the hands of attorneys for collection, the
Borrower agrees to pay, in addition to principal and interest, fees and charges
due under the Agreement, and all costs of collecting this Note, including
reasonable attorneys' fees and expenses.
This Note shall be construed and enforced in accordance with the laws of
the State of Texas, without reference to its principles of conflicts of law, and
applicable federal laws of the United States of America.
-4-
This Note is secured by all security agreements, collateral assignments,
deeds of trust and lien instruments executed by the Borrower in favor of Lender,
or executed by any other Person as security for this Note, including any
executed prior to, simultaneously with, or after the date of this Note and
including, without limitation, the Security Documents.
The Borrower and any and each co-maker, guarantor, accommodation party,
endorser or other Person liable for the payment or collection of this Note
expressly waive notice, presentment, demand for payment, protest, notice of
protest and non-payment or dishonor, notice of acceleration, notice of intent to
accelerate, notice of intent to demand, bringing of suit, and diligence in
taking any action to collect amounts called for hereunder and in the handling of
Collateral at any time existing as security in connection herewith, and shall be
directly and primarily liable for the payment of all sums owing and to be owing
hereon, regardless of and without any notice, diligence, act or omission as or
with respect to the collection of any amount called for hereunder or in
connection with any Lien at any time had or existing as security for any amount
called for hereunder.
It is the intention of the parties hereto to conform strictly to usury laws
applicable to the Lender. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law (including the laws of the United States
of America and the State of Texas), then, in that event, notwithstanding
anything to the contrary herein or in the Agreement or in any other Loan
Document or agreement entered into in connection with or as security for this
Note; it is agreed as follows: (i) the aggregate of all consideration which
constitutes interest under law applicable to the Lender that is contracted for,
taken, reserved, charged, or received herein or under the Agreement or under any
of the other aforesaid Loan Documents or agreements or otherwise in connection
herewith shall under no circumstances exceed the maximum amount allowed by such
applicable law, and any excess shall be credited by the Lender on the principal
amount of the Obligations (or, if the principal amount of the Obligations shall
have been paid in full, refunded by the Lender to me Borrower, as required); and
(ii) in the event that the maturity of this Note is accelerated by reason of an
election of the required or permitted prepayment, then such consideration that
constitutes interest under law applicable to the Lender may never include more
than the maximum amount allowed by such applicable law, and excess interest, if
any, provided for in the Agreement or otherwise shall be canceled automatically
as of the date of such acceleration or prepayment and, if theretofore paid,
shall be credited by the Lender on the principal amount of the Obligations (or,
if the principal amount of the Obligations shall have been paid in full,
refunded by the Lender to the Borrower, as required). Without limiting the
foregoing, all calculations of the rate of interest taken, reserved, contracted
for, charged, received or provided for under this Note or any of the Loan
Documents which are made for the purpose of determining whether the interest
rate exceeds the Maximum Rate shall be made, to the extent allowed by law, by
amortizing, prorating, allocating and spreading in equal parts during the period
of the full stated term of the loan evidenced hereby, all interest at any time
taken, reserved, contracted for, charged, received, or provided for under this
Note or any of the Loan Documents. To the extent that the Section 303 of the
Texas Finance Code is relevant for
-5-
purposes of determining the Maximum Rate, the Lender hereby elects to determine
the applicable rate ceiling under such statute by the weekly rate ceiling from
time to time in effect, subject to the Lender's right subsequently to change
such method in accordance with applicable law.
BANC NLC MORTGAGE LENDING, LLC
By:
-------------------------------
Name:
Title:
NLC FINANCIAL SERVICES, LLC
By:
-------------------------------
Name:
Title:
-6-
---------------------------------------
BANK UNITED MBF LEGAL FILE
Customer Illegible
Reviewed by: Illegible Date: _________
____ PSA AGRMNT ____ INCORPORATION
____ WAREHSE AGRMNT ____ INSURANCE
____ UCC ____ OPINION LTR
____ GUARANTY
Other: Illegible
---------------------------------------
AMENDMENT NO. 1 TO
WAREHOUSING CREDIT AND SECURITY AGREEMENT
THIS AMENDMENT ("Amendment"), dated as of September 25, 2000, is by and
among FIRST NLC FINANCIAL SERVICES, LLC (f/k/a BANK NLC MORTGAGE LENDING, LLC)
and NLC FINANCIAL SERVICES, LLC, (collectively, the "Borrower") and BANK
UNITED, a federal savings bank (as lender).
BACKGROUND
A. The Borrower and Lender are parties to that certain Warehousing Credit
and Security Agreement dated as of February 4, 2000 (as amended from time to
time, the "Agreement").
B. The Borrower has failed to meet certain of the financial covenants as of
April 30, 2000 and has requested that Lender amend such financial covenants
under the Agreement from and after the date hereof.
C. The Borrower and Lender desire to amend the Agreement as set forth
herein.
D. All capitalized terms used herein and not otherwise defined herein shall
have the meanings given to them in the Agreement.
NOW, THEREFORE, the foregoing Background Section being incorporated by
reference, the parties hereto agree as follows:
1. Lender agrees to forebear in the exercise of its rights with respect to
Borrower's breach of Section 7.5 and 7.6 of the Agreement through and including
September 30, 2000.
2. Section 7.5 is amended in its entirety as follows:
7.5 Indebtedness to Tangible Net Worth Ration. Permit the ratio of
Indebtedness to Tangible Net Worth of the Company (and its Subsidiaries, on
a consolidated basis) to exceed: (i) 18:1 at September 30, 2000 and October
31, 2000, (ii) 16:1 at November 30, 2000, and at the end of each calendar
month thereafter though and including May 31, 2000, and (iii) 14:1 at June
30, 2001 and at the end of each calendar month thereafter.
3. Section 7.6 is amended in its entirety as follows:
7.6 Minimum Adjusted Tangible Net worth. Permit Adjusted Tangible Net
Worth of the Company (and its Subsidiaries, on a consolidated basis) to be
less than (i) One Million, Five Hundred Thousand Dollars ($1,500,000.00)
computed as of September 30, 2000, and October 31, 2000, (ii) One Million,
Seven Hundred Fifty Thousand Dollars ($1,750,000.00) computed as of
November 30, 2000 and at the end of each calendar month thereafter through
and including May 31, 2001, and (iii) Two Million Two Hundred Fifty
Thousand Dollars ($2,250,000.00) as of June 30, 2001 and at the end of each
calendar month thereafter.
4. This Amendment shall only be effective upon Lender's receipt of the
following.
a) a copy of this Amendment No. 5 duly executed by the Borrower;
b) evidence acceptable to Lender in its sole discretion that the
Borrower has taken all necessary corporate action to authorize
the execution of this Amendment and any other document executed
in connection herewith;
c) The Borrower shall have paid all fees, expenses and costs due to
or advanced by Lender through the date hereof.
5. The Borrower hereby ratifies and reaffirms the representations and
warranties set forth in Article V of the Agreement as being true and correct as
of the date hereof, except as caused by the circumstances described herein.
6. The Borrower acknowledges and agrees that (i) the Borrower's Obligations
to Lender and liens granted to secure such Obligations are valid and perfected
in accordance with applicable law; (ii) the Borrower's Obligations to Lender are
not subject to any setoff, defense, claim, counterclaim, recoupment, or
avoidance and/or subordination under the Bankruptcy Code or otherwise; and (iii)
the Borrower holds no claims against Bank United, its officers, agents,
directors, representatives, attorneys, or any of their respective heirs,
successors and assigns (collectively, the "Lender Parties") with respect to the
Loan Documents. To the extent that the Borrower holds any claims against one of
more of the Lender Parties, arising under the Loan Documents and extension of
credit or administration thereof, collection of amounts due thereunder, or any
applications, discussions, as consideration for Lender's undertakings under the
Agreement or this Amendment, the Borrower hereby unconditionally forever
releases, discharges, and acquits the Lender Parties of any and all claims,
breaches of contract, debts, suits, demands, causes of actions and actions of
any type or notice which arose or are based on occurrences or transactions which
took place prior to the date of this Amendment, whether known or unknown,
contingent or liquidated, suspected or unsuspected, at law or in equity, or
based in contract or tort. The Borrower acknowledges and represents that it has
received the advice of counsel in connection with this acknowledgment and
release and has voluntarily entered into this acknowledgement and release.
7. Except as amended hereby, all of the terms and conditions of the
Agreement and the obligations of the Borrower under the Note are ratified and
confirmed, and the Agreement shall continue in full force and effect in
accordance with its terms.
8. This Amendment may be executed in counterparts, all of which
counterparts, when taken together, will constitute the entire agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date set forth above.
FIRST NLC FINANCIAL SERVICES, LLC
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Its E.V.P.
NLC FINANCIAL SERVICES LLC
By /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Its EVP
BANK UNITED
By /s/ Illegible
-------------------------------------
Its Director
================================================================================
WAREHOUSING CREDIT AND SECURITY AGREEMENT
(SINGLE-FAMILY MORTGAGE LOANS)
BETWEEN
BANC NLC MORTGAGE LENDING, LLC,
a Florida limited liability company
and
NLC FINANCIAL SERVICES, LLC
a Delaware limited liability company
AND
BANK UNITED,
a federal savings bank
Dated as of , 2000
-----------
================================================================================
TABLE OF CONTENTS
Page
----
1. DEFINITIONS.............................................................1
1.1 Defined Terms...................................................1
1.2 Other Definitional Provisions..................................10
2. THE CREDIT.............................................................11
2.1 The Commitment.................................................11
2.2 Procedures for Obtaining Advances..............................12
2.3 Note...........................................................13
2.4 Interest.......................................................14
2.5 Principal Payments.............................................14
2.6 Expiration of Commitment.......................................16
2.7 Method of Making Payments......................................16
2.8 Non-Usage Fee..................................................17
2.9 Miscellaneous Charges..........................................17
2.10 Bailee.........................................................17
3. COLLATERAL.............................................................17
3.1 Grant of Security Interest.....................................17
3.2 Delivery of Collateral Documents...............................19
3.3 Delivery of Additional Collateral or Mandatory
Prepayment..................................................19
3.4 Right of Redemption from Pledge................................19
3.5 Collection and Servicing Rights................................19
3.6 Return or Release of Collateral at End of Commitment...........20
4. CONDITIONS PRECEDENT...................................................20
4.1 Initial Advance................................................20
4.2 Each Advance...................................................22
5. REPRESENTATIONS AND WARRANTIES.........................................23
5.1 Organization; Good Standing; Subsidiaries......................23
5.2 Authorization and Enforceability...............................23
5.3 Financial Condition............................................23
5.4 Litigation.....................................................24
5.5 Compliance with Laws...........................................24
Page i
TABLE OF CONTENTS
Page
----
5.6 Regulation U...................................................24
5.7 Investment Company Act.........................................24
5.8 Agreements.....................................................24
5.9 Title to Properties............................................25
5.10 ERISA..........................................................25
5.11 Eligibility....................................................25
5.12 Special Representations Concerning Collateral..................25
5.13 RICO...........................................................26
5.14 Proper Names...................................................27
5.15 Direct Benefit From Loans......................................27
5.16 Loan Documents Do Not Violate Other Documents..................27
5.17 Consents Not Required..........................................27
5.18 Material Fact Representations..................................27
5.19 Place of Business..............................................28
5.20 Use of Proceeds; Business Loans................................28
5.21 No Undisclosed Liabilities.....................................28
5.22 Tax Returns and Payments.......................................28
5.23 Subsidiaries...................................................28
5.24 Holding Company................................................29
5.25 Year 2000 Issue................................................29
6. AFFIRMATIVE COVENANTS..................................................29
6.1 Payment of Note................................................29
6.2 Financial Statements and Other Reports.........................29
6.3 Maintenance of Existence; Conduct of Business..................30
6.4 Compliance with Applicable Laws................................30
6.5 Inspection of Properties and Books.............................30
6.6 Notice.........................................................31
6.7 Payment of Indebtedness, Taxes, etc............................31
6.8 Insurance......................................................32
6.9 Closing Instructions...........................................32
6.10 Other Loan Obligations.........................................32
Page ii
TABLE OF CONTENTS
Page
----
6.11 Use of Proceeds of Advances....................................32
6.12 Special Affirmative Covenants Concerning Collateral............32
6.13 Cure of Defects in Loan Documents..............................33
7. NEGATIVE COVENANTS.....................................................34
7.1 Contingent Liabilities.........................................34
7.2 Pledge of Mortgage Loans.......................................34
7.3 Merger; Acquisitions...........................................34
7.4 Loss of Eligibility............................................34
7.5 Indebtedness to Tangible Net Worth Ratio.......................34
7.6 Minimum Adjusted Tangible Net Worth............................34
7.7 Transactions with Affiliates...................................34
7.8 Limits on Distributions........................................35
7.9 RICO...........................................................35
7.10 No Loans or Investments Except Approved Investments............35
7.11 Charter Documents and Business Termination.....................36
7.12 Changes in Accounting Methods..................................36
7.13 No Sales, Leases or Dispositions of Property...................36
7.14 Changes in Business or Assets..................................36
7.15 Changes in Office or Inventory Location........................36
7.16 Special Negative Covenants Concerning Collateral...............36
7.17 No Indebtedness................................................37
7.18 Ownership of the Company.......................................38
7.19 Material Adverse Change........................................38
8. DEFAULTS; REMEDIES.....................................................38
8.1 Events of Default..............................................38
8.2 Remedies.......................................................41
8.3 Application of Proceeds........................................43
8.4 Lender Appointed Attorney-in-Fact..............................44
8.5 Right of Set-Off...............................................44
9. NOTICES................................................................45
10. REIMBURSEMENT OF EXPENSES; INDEMNITY...................................45
Page iii
TABLE OF CONTENTS
Page
----
11. FINANCIAL INFORMATION..................................................46
12. MISCELLANEOUS..........................................................47
12.1 Terms Binding Upon Successors; Survival of
Representations.............................................47
12.2 Assignment.....................................................47
12.3 Amendments.....................................................47
12.4 Governing Law..................................................47
12.5 Participations.................................................47
12.6 Relationship of the Parties....................................47
12.7 Severability...................................................48
12.8 Usury..........................................................48
12.9 Consent to Jurisdiction........................................49
12.10 Arbitration....................................................49
12.11 ADDITIONAL INDEMNITY...........................................50
12.12 No Waivers Except in Writing...................................51
12.13 Waiver of Jury Trial...........................................51
12.14 Multiple Counterparts..........................................51
12.15 No Third Party Beneficiaries...................................51
12.16 RELEASE OF LENDER LIABILITY....................................51
12.17 Entire Agreement; Amendment....................................52
12.18 NO ORAL AGREEMENTS.............................................52
EXHIBIT A....................................................................55
EXHIBIT B....................................................................58
EXHIBIT C....................................................................59
EXHIBIT D....................................................................62
EXHIBIT E....................................................................63
EXHIBIT F....................................................................65
ANNEX TO EXHIBIT F...........................................................66
EXHIBIT G....................................................................68
EXHIBIT H....................................................................69
EXHIBIT I....................................................................70
EXHIBIT J....................................................................71
Page iv
TABLE OF CONTENTS
Page
----
EXHIBIT K....................................................................75
EXHIBIT L....................................................................77
EXHIBIT M....................................................................78
EXHIBIT N....................................................................81
Page v
WAREHOUSING CREDIT AND SECURITY AGREEMENT
THIS WAREHOUSING CREDIT AND SECURITY AGREEMENT (this "Agreement"), is dated
as of , 2000, by and between
------------------------------------- ---------
BANC NLC MORTGAGE LENDING, LLC ("Bank NLC"), a Florida limited liability company
and NLC FINANCIAL SERVICES LLC ("NLC Services"), a Delaware limited liability
company (collectively, the "Company"), having its principal office at 000 Xxxx
Xxxxxxxxxxxx Xxxxxxxxx, Xxxxxxxxx Xxxxx, Xxxxxxx 00000, and BANK UNITED, a
federal savings bank (the "Lender"), having its principal office at 0000
Xxxxxxxxx Xxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000.
WHEREAS, the Company has requested the Lender to make certain loans to the
Company to finance the origination or purchase of Eligible Mortgage Loans (as
that term is herein defined) which loans are for the benefit of the Company;
WHEREAS, the Lender is willing to make such loans as herein provided, upon
the terms, agreements and covenants and subject to the conditions hereinafter
set forth and in reliance on the representations and warranties herein made and
referred to; and
WHEREAS, the Company and the Lender desire to set forth herein the terms
and conditions upon which the Lender shall provide warehouse financing to the
Company;
NOW, THEREFORE, for good and valuable consideration, the amount and
sufficiency of which are hereby acknowledged by the parties hereto, to induce
the Lender to provide the warehouse financing facility to the Company and in
reliance of the representations and warranties made herein, the parties hereto
hereby agree as follows:
1. DEFINITIONS.
1.1 Defined Terms, Capitalized terms defined below or elsewhere in this
Agreement (including the exhibits hereto) shall have the following meanings:
"Adjusted Tangible Net Worth" means Tangible Net Worth plus
Subordinated Debt.
"Advance" means a Subprime Mortgage Loan Advance, a Second Mortgage
Loan Advance, a Subwarehouse Mortgage Loan Advance or an Aged Mortgage Loan
Advance pursuant to Article 2 of this Agreement in respect of the closing,
settlement, or acquisition of a Mortgage Loan or rehabilitation property,
whether or not such disbursement is a Wet Settlement Advance.
"Advance Request" has the meaning set forth in Section 2.2(a) hereof.
"Affiliate" shall mean any Person controlling, controlled by or under
common control with any other Person. For purposes of this definition
"control" (including
"controlled by" and "under common control with") means the possession,
directly or indirectly, of the power to direct or cause the direction of
the management and policies of such Person, whether through the ownership
of voting securities, by contract, or otherwise or owning or possessing the
power to vote 10% or more of any class of voting securities of any Person.
Without limiting the generality of the foregoing, for purposes of this
Agreement, Company and each of its respective Subsidiaries shall be deemed
to be Affiliates of one another.
"Aged Mortgage Loan" means an Eligible Mortgage Loan that has been
included in Collateral for a period of more than ninety (90) days.
"Aged Mortgage Loan Advance" means any Advance with respect to an Aged
Mortgage Loan.
"Agreement" means this Warehousing Credit and Security Agreement
(Single Family Mortgage Loans), either as originally executed or as it may
from time to time be supplemented, modified or amended.
"Applicable Law" shall mean the laws of the State of Texas and the
United States of America in effect from time to time and applicable to the
transactions between the Lender and the Company pursuant to this Agreement
and the other Loan Documents whichever permits the charging and collection
of the highest non-usurious rate of interest on such transactions. For
purposes of determining Texas law with respect to the highest non-usurious
rate of interest, the "weekly ceiling" as defined in Chapter 303 of the
Texas Finance Code (the "Texas Finance Code"), as amended, shall be
controlling.
"Applicable Margin" means:
Type of Advance Applicable Margin
--------------- -----------------
Subprime Mortgage Loan Advances [*]% per annum
Second Mortgage Loans Advances [*]% per annum
Subwarehouse Advances [*]% per annum
Aged Mortgage Loan Advances [*]% per annum
"Approved Custodian" means a Person acceptable to the Lender from time
to time in its sole discretion, who possesses Mortgage Loans that secure
Mortgaged-backed Securities.
"Bailee Letter" has the meaning set forth in Section 3.2 hereof.
2
"Business Day" means any day excluding Saturday, Sunday and any day on
which Lender is closed for business.
"Capitalized Lease" shall mean any lease under which rental payments
are required to be capitalized on a balance sheet of the lessee in
accordance with GAAP.
"Capitalized Rentals" shall mean the amount of aggregate rentals due
and to become due under all Capitalized Leases under which the Company is a
lessee that would be reflected as a liability on a balance sheet of the
Company.
"Change of Control" means
(a) a sale of substantially all of either Company's assets,
membership interests or other equity interests to any Person or
related group of Persons; or
(b) without the Lender's prior written consent, Xxxx Xxxxxxxx and
Xxxxxxx Xxxxxxxx cease to be President and Executive Vice President,
respectively.
"Collateral" has the meaning set forth in Section 3.1 hereof.
"Collateral Documents" means all of the documents and other items
described on Exhibit C hereto and required to be delivered to the Lender in
connection with an Advance.
"Collateral Value" means
(a) with respect to any Eligible Mortgage Loan, an amount equal
to the least of (i) the actual out-of-pocket cost of such Mortgage
Loan to the Company, i.e., the net amount actually funded against such
Mortgage Loan or the net purchase price of such Mortgage Loan, (ii)
the Par Value thereof, (iii) the amount which the Investor has
committed to pay for such Mortgage Loan pursuant to a Purchase
Commitment, or (iv) the Fair Market Value of such Mortgage Loan;
(b) with respect to Collateral that is not described within (a),
and that is pledged pursuant to Section 3.3 hereof, Collateral Value
shall equal an amount established by Lender in its sole discretion;
(c) with respect to Collateral that is not described in (a), or
(b) the Collateral Value shall be equal to $0.00; and
(d) notwithstanding the foregoing, with respect to Mortgage Loans
that are in default in the payment of principal and interest or in the
performance of any obligation under the Mortgage Note or the Mortgage
evidencing or securing such
3
Mortgage Loans for a period of sixty (60) days or more, the Collateral
Value thereof shall equal $0.00.
"Commitment" has the meaning set forth in Section 2.1 (a) hereof.
"Company" has the meaning set forth in the first paragraph of this
Agreement.
"Default" means the occurrence of any event or existence of any
condition which, but for the giving of notice, the lapse of time, or both,
would constitute an Event of Default.
"Default Rate" has the meaning set forth in Section 2.4(c) hereof.
"Electronic Request" has the meaning set forth in Section 2.2(a)
hereof.
"Eligible Mortgage Loan" means a Subprime Mortgage Loan, a
Subwarehouse Loan, a Second Mortgage Loan or an Aged Mortgage Loan which
(a) has closed less than twenty-five (25) days prior to the date of the
Advance made in connection with such Mortgage Loan, (b) is validly pledged
to Lender and is not subject to any other Liens, (c) has not been pledged
to any other lender, and (d) is not in default for more than sixty (60)
days.
"ERISA" means the Employee Retirement Income Security Act of 1974 and
all rules and regulations promulgated thereunder, as amended from time to
time and any successor statute.
"Event of Default" means any of the conditions or events set forth in
Section 8.1 hereof.
"Fair Market Value" shall mean the market price of any Mortgage Loan
as determined by Lender in its reasonable discretion.
"FHLMC" means the Federal Home Loan Mortgage Corporation and any
successor thereto.
"FHLMC Guide" means the FHLMC Sellers' and Servicers' Guide, dated
September 17, 1984, applicable bulletins, the applicable MIDANET Users
Guide (or the MIDAPHONE User's Guide) and any particular purchase documents
as defined in the Sellers' and Servicers' Guide, as revised prior to the
date hereof.
"FICA" means the Federal Insurance Contributions Act.
"First Mortgage" means a mortgage or deed of trust which constitutes a
first Lien on the property covered thereby.
4
"FNMA" means the Federal National Mortgage Association and any
successor thereto.
"FNMA Guide" means the FNMA Servicing Guide dated June 30, 1990, as
revised prior to the date hereof.
"Funding Account" means the non-interest bearing demand checking
account established with, maintained by, and pledged to Lender into which
shall be deposited the proceeds of Advances, the proceeds from any sale of
Collateral, and from which funds shall be disbursed for the acquisition of
Mortgage Loans.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board and the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment
of the accounting profession, which are applicable to the circumstances as
of the date of determination.
"GNMA" means the Government National Mortgage Association and any
successor thereto.
"HUD" means the Department of Housing and Urban Development and any
successor thereto.
"Indebtedness" shall mean and include, without duplication, (1) all
items which in accordance with GAAP, consistently applied, would be
included on the liability side of a balance sheet on the date as of which
Indebtedness is to be determined (excluding shareholders' equity), (2)
Capitalized Rentals under any Capitalized Lease, (3) guaranties,
endorsements and other contingent obligations in respect of, or any
obligations to purchase or otherwise acquire, Indebtedness of others, and
(4) indebtedness secured by any mortgage, pledge, security interest or
other Lien existing on any property owned by the Person with respect to
which indebtedness is being determined, whether or not the indebtedness
secured thereby shall have been assumed.
"Indemnified Liabilities" has the meaning set forth in Article 10
hereof.
"Interest Rate" means the Monthly Average LIBO Rate plus the
Applicable Margin.
"Interim Date" has the meaning set forth in Section 4.1(a)(5) hereof.
"Internal Revenue Code" means the Internal Revenue Code of 1986, or
any subsequent federal income tax law or laws, as any of the foregoing have
been or may from time to time be amended.
5
"Investor" means any of the Persons listed in Exhibit L hereto, or a
financially responsible institution which is reasonably acceptable to
Lender, in its sole discretion; provided that at any time by reasonable
written notice to Company Lender may disapprove any Investor in its
reasonable discretion, whether or not that Person is named as an Investor
in this definition or in Exhibit L or has been previously approved as an
Investor by Lender. Upon receipt of such notice, the Persons named in
Lender's notice shall no longer be Investors from and after the date of the
receipt of such notice.
"Lender" has the meaning set forth in the first paragraph of this
Agreement.
"LIBO Rate" means a rate of interest equal to the London Interbank
Offered Rate for U. S. dollar deposits as quoted by Telerate, Bloomberg or
any other rate quoting service, selected by Lender in its sole discretion
for an interest period of one month. In the event such rate ceases to be
published, LIBO Rate shall mean a comparable rate of interest reasonably
selected by Lender.
"Lien" means any lien, mortgage, deed of trust, pledge, security
interest, charge or encumbrance of any kind (including any conditional sale
or other title retention agreement, any lease in the nature thereof, and
any agreement to give any security interest).
"Loan Documents" means this Agreement, the Note, and each other
document, instrument or agreement executed by the Company or any other
Person in connection herewith or therewith, as any of the same may be
amended, restated, renewed or replaced from time to time.
"Margin Stock" has the meaning assigned to that term in Regulations G
and U of the Board of Governors of the Federal Reserve System as in effect
from time to time.
"Maximum Rate" shall mean the maximum lawful non-usurious rate of
interest (if any) that, under Applicable Law, the Lender may charge the
Company on the Advances from time to time. To the extent that the interest
rate laws of the State of Texas are applicable and unless changed in
accordance with law, the applicable rate ceiling shall be the weekly
ceiling determined in accordance with the Texas Finance Code, as amended.
"Monthly Average LIBO Rate" means the average of all LIBO Rates quoted
during a given month. In the event (i) the Note is paid in full and the
Commitment is terminated prior to a month end; or (ii) the initial Advance
hereunder occurs on a date other than the first day of that month on which
LIBO Rates are quoted, the Monthly Average LIBO Rate shall mean, in the
case of clause (i), the average of all LIBO Rates quoted that month up to
and including the last Business Day prior to such payment in full; or, in
the case of clause (ii), the LIBO Rates quoted on the date of the initial
Advance through the end of that month.
"Mortgage" means a First Mortgage or Second Mortgage.
6
"Mortgage Loan" means any loan evidenced by a Mortgage Note. A
Mortgage Loan, unless otherwise expressly stated herein, means a
Single-family Mortgage Loan.
"Mortgage Note" means a note secured by a Mortgage.
"Mortgage Note Amount" means, as of the date of determination, the
then outstanding unpaid principal amount of a Mortgage Note.
"Mortgaged Property" means the property, real, personal, tangible or
intangible, securing a Mortgage Note.
"Multiemployer Plan" means a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA that is maintained for employees of the Company
or a Subsidiary of the Company.
"Net Investable Balances" means the average collected balances in
non-interest bearing deposit accounts controlled or maintained by the
Company in accounts at the Lender, less balances to support float, activity
charges, reserve requirements, Federal Deposit Insurance Corporation
insurance premiums and such other assessments as may be imposed by
governmental authorities from time to time.
"NLCI" means National Lending Center, Inc., a Florida corporation.
"NLCI Agreement" means that certain Management and Funding Agreement
by and between NLCI and Banc NLC whereby Banc NLC operates and manages
NLCI.
"Note" has the meaning set forth in Section 2.3 hereof.
"Notices" has the meaning set forth in Article 9 hereof.
"Obligations" shall mean any and all indebtedness, obligations and
liabilities of the Company to the Lender (whether now existing or hereafter
arising, voluntary or involuntary, whether or not jointly owed with others,
direct or indirect, absolute or contingent, liquidated or unliquidated, and
whether or not from time to time decreased or extinguished and later
increased, created or incurred), arising out of or related to the Loan
Documents, or any of them.
"Officer's Certificate" means a certificate executed on behalf of the
Company by its chief financial officer or its treasurer or by such other
officer as may be designated herein, in form and substance satisfactory to
Lender.
"OTS" means the Office of Thrift Supervision.
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"Par Value" means, with respect to any Mortgage Loan, the unpaid
principal balance of such Mortgage Loan, on the date of the Advance made
against such Mortgage Loan.
"Participant" has the meaning set forth in Section 12.5 hereof.
"Person" means and includes natural persons, corporations, limited
partnerships, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, banks, trust companies, land trusts,
business trusts or other organizations, whether or not legal entities, and
federal and state governments and agencies or regulatory authorities and
political subdivisions thereof.
"Plans" has the meaning set forth in Section 5.10 hereof.
"Pledged Mortgages" has the meaning set forth in Section 3.1 (a)
hereof.
"PMI" means any private mortgage insurance company which is reasonably
acceptable to Lender, in its sole discretion; provided that at any time by
reasonable written notice to Company, Lender may disapprove any PMI because
it has determined in its reasonable discretion and for any reason that it
is no longer comfortable with that Person being a PMI, whether or not that
Person has been previously approved as a PMI by Lender. Upon receipt of
such notice, the Persons named in Lender's notice shall no longer be PMIs
from and after the date of receipt of such notice.
"Purchase Commitment" means a written commitment, in form and
substance satisfactory to the Lender, issued in favor of the Company by an
Investor pursuant to which that Investor commits to purchase Mortgage
Loans.
"Redemption Amount" has the meaning set forth in Section 3.5 hereof.
"RICO" means the Racketeer Influenced and Corrupt Organizations Act of
1970, as amended.
"Second Mortgage" means a mortgage or deed of trust which constitutes
a second Lien on the property covered thereby.
"Second Mortgage Loan" means a Single-family Mortgage Loan that (a)
is, in the reasonable judgment of the Lender, consistent in all respects
with traditional standards imposed by whole loan purchasers, relevant
rating agencies and pool insurers for classification as "A" to "D" Mortgage
Loans, (b) has a maximum amount that does not exceed Three Hundred Fifty
Thousand Dollars ($350,000), (c) is secured by a Second Mortgage, (d) has a
combined loan-to-collateral value ratio not greater than 100% (ratio based
upon all loans secured by the Mortgaged Property), and (e) is not an
"open-ended" line of credit.
8
"Second Mortgage Loan Advance" means any Advance with respect to a
Second Mortgage Loan.
"Single-family Mortgage Loan" means a Mortgage Loan secured by a
Mortgage covering improved real property containing one to four family
residences.
"Statement Date" has the meaning set forth in Section 4.1(a)(5)
hereof.
"Subordinated Debt" means, with respect to any Person, all
Indebtedness of such Person, for borrowed money, which is, by its terms
(which terms shall have been approved by the Lender) or by the terms of a
subordination agreement, in form and substance satisfactory to the Lender,
effectively subordinated in right of payment to all other present and
future obligations and all indebtedness of such Person, of every kind and
character, owed to the Lender.
"Subprime Mortgage Loan" means a Single-family Mortgage Loan that (a)
is, in the reasonable judgment of the Lender, consistent in all respects
with traditional standards imposed by whole loan purchasers, relevant
rating agencies and pool insurers for classification as "A" to "D" Mortgage
Loans, (b) has a maximum loan amount that does not exceed Three Hundred
Fifty Thousand Dollars ($350,000.00), (c) is secured by a First Mortgage,
and (d) has a combined loan-to-collateral value ratio not greater than 100%
(ratio to be based upon all loans secured by the Mortgaged Property).
"Subprime Mortgage Loan Advance" means any Advance made with respect
to Subprime Mortgage Loans.
"Subsidiary" means any corporation, association or other business
entity in which more than fifty percent (50%) of the total voting power or
shares of stock entitled to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or
indirectly, by any Person or one or more of the other Subsidiaries of that
Person or a combination thereof.
"Subwarehouse Mortgage Loan" means a Mortgage Loan which meets all of
the requirements of an Eligible Loan and which is closed in the name of
NLCI but assigned and delivered to Bane NLC within forty-eight (48) hours
of funding.
"Subwarehouse Mortgage Loan Advance" means any Advance made in respect
of a Subwarehouse Mortgage Loan.
"Tangible Net Worth" means, with respect to any Person at any date,
the sum of the total shareholders' equity in such Person (including capital
stock, additional paid-in capital, and retained earnings, but excluding
treasury stock, if any), on a consolidated basis; less the aggregate book
value of all intangible assets of such Person (as determined in accordance
with GAAP), including without limitation, goodwill, trademarks, trade
names, service marks, copyrights, patents, licenses, franchises, and
Servicing Rights,
9
each to be determined in accordance with GAAP consistent with those applied in
the preparation of the financial statements referred to in Section 5.3 hereof;
provided that, for purposes of this Agreement, there shall be excluded from
total assets, advances or loans to shareholders, officers or Affiliates,
investments in Affiliates, assets pledged to secure any liabilities not included
in the Indebtedness of such Person and those other assets which would be deemed
by HUD to be non-acceptable in calculating adjusted net worth in accordance with
its requirements in the Audit Guide for Audit of Approved Non-Supervised
Mortgagees, as in effect as of such date.
"Termination Date" shall mean January 31, 2001, or such earlier date upon
which Lender's obligation to fund shall be terminated pursuant to the terms of
this Agreement.
"Texas Finance Code" is defined in the definition of "Applicable Law."
"Tribunal" shall mean any court or governmental department, commission,
board, bureau, agency, or instrumentality of any state, commonwealth, nation,
territory, possession, county, parish, or municipality, whether now or hereafter
constituted and/or existing.
"VA" means the Veterans Administration and any successor thereto.
"Wet Settlement Advance" means a disbursement by the Lender under the
Commitment and pursuant to Section 2.2(a) of this Agreement, in respect of the
closing or settlement of an Eligible Mortgage Loan, in anticipation of and
pending subsequent delivery and examination of the Collateral Documents as
provided in Section II of Exhibit C, and may include a Subwarehouse Mortgage
Loan Advance.
"Year 2000 Issue" means the failure of computer software, hardware, and
firmware systems and equipment containing embedded computer chips to properly
receive, transmit, process, manipulate, store, retrieve, re-transmit or in any
other way utilize data and information due to the occurrence of the year 2000 or
the inclusion of dates on or after January 1, 2000.
1.2 Other Definitional Provisions.
(a) Accounting terms not otherwise defined herein shall have the
meanings given the terms under GAAP.
(b) Defined terms may be used in the singular or the plural, as the
context requires.
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2. THE CREDIT.
2.1 The Commitment.
(a) Subject to the terms and conditions of this Agreement and
provided no Default or Event of Default has occurred and is
continuing, the Lender agrees, from time to time during the period
from the date hereof to and including the Termination Date, to make
Advances to the Company, provided the sum of the total aggregate
principal amount outstanding at any one time of all such Advances
shall not exceed TWENTY-FIVE MILLION AND NO/100 DOLLARS
($25,000,000.00). The obligation of the Lender to make Advances
hereunder up to such limit is hereinafter referred to as the
"Commitment." Within the Commitment, the Company may borrow, repay and
reborrow. All Advances under this Agreement shall constitute a single
indebtedness, and all of the Collateral shall be security for the Note
and for the performance of all the Obligations of the Company to the
Lender.
(b) Advances shall be used by the Company solely for the purpose
of funding the acquisition or origination of Eligible Mortgage Loans,
as specified in the Advance Request and none other, and shall be made
at the request of the Company in the manner hereinafter provided in
Section 2.2, against the pledge of such Mortgage Loans and such other
collateral as is set forth in Section 3.1 hereof as Collateral
therefor. Advances shall also be subject to the following
restrictions:
(1) No Advance shall be made against Mortgage Loans which
are not Eligible Mortgage Loans.
(2) The aggregate amount of Wet Settlement Advances
outstanding at any one time shall not exceed TEN MILLION AND
NO/100 DOLLARS ($10,000,000.00).
(3) The aggregate amount of Subwarehouse Mortgage Loan
Advances outstanding at any one time shall not exceed TWO MILLION
FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($2,500,000.00).
(4) The aggregate amount of Aged Mortgage Loan Advances
outstanding at any one time shall not exceed ONE MILLION AND
NO/100 DOLLARS ($1,000,000.00)
(5) The aggregate amount of Second Mortgage Loan Advances
outstanding at any one time shall not exceed Seven million
Dollars ($7,000,000).
(c) No Advance shall exceed the following amounts applicable to
the type of Collateral, determined as of the date the Collateral is
pledged to Lender.
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No Advance shall exceed: with respect to Subprime Mortgage Loans, an
amount equal to [*] of the Collateral Value of such Mortgage Loan;
with respect to Second Mortgage Loans, an amount equal to [*]% of the
Collateral Value of such Mortgage Loan; and with respect to
Subwarehouse Mortgage Loans an amount equal to [*]% of the Collateral
Value of such Subwarehouse Mortgage Loan until the earlier to occur of
(x) the termination of any Commitment hereunder and (y) April 30,
2000.
2.2 Procedures for Obtaining Advances.
(a) The Company may obtain an Advance hereunder subject to the
following:
(1) The Company may obtain an Advance hereunder, subject to
the satisfaction of the conditions set forth in Sections 4.1 and
4.2 hereof, upon compliance with the procedures set forth in this
Section 2.2 and in Exhibit C attached hereto and made a part
hereof. Requests for Advances shall be initiated by the Company
(i) by delivering to the Lender and its designee, by telecopy
(with original to be sent immediately thereafter by overnight
mail) a completed and signed request for an Advance (an "Advance
Request") in the form of Exhibit A attached hereto and made a
part hereof, or (ii) by using the electronic data transmission
service provided by the Lender and its licensor, MBMS
Incorporated, to transmit to the Lender a request for Advance
("Electronic Request"), which shall include all information
required by Exhibit A through the Warehouse Management System
software provided by the Lender and its licensor, MBMS
Incorporated. The Lender shall have the right, on not less than
three (3) Business Days' prior notice to the Company, to modify
the Advance Request, Electronic Request, or any exhibits hereto
to conform to current legal requirements or Lender practices,
and, as so modified, said Advance Request, Electronic Request or
exhibits shall be deemed a part hereof. In consideration of the
Lender permitting the Company to make Electronic Requests for
Advances utilizing the Warehouse Management System software or
Advance Requests by telecopy, the Company covenants and agrees to
assume liability for and to protect, indemnify and save the
Lender harmless from, any and all liabilities, obligations,
damages, penalties, claims, causes of action, costs, charges and
expenses, including attorneys' fees and expenses of employees,
which may be imposed, incurred by or asserted against the Lender
by reason of any loss, damage or claim howsoever arising or
incurred because of, out of or in connection with (i) any action
of the Lender pursuant to Electronic Requests or Advance Requests
by telecopy, (ii) the breach of any provisions of this Agreement
by the Company, (iii) the transfer of funds pursuant to such
Electronic Requests or Advance Requests by telecopy, or (iv) the
Lender's honoring or failing to honor any Electronic Request or
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Advance Request by telecopy for any reason or no reason
whatsoever. The Lender is entitled to rely upon and act upon
Electronic Requests or Advance Requests by telecopy, and the
Company shall be unconditionally and absolutely estopped from
denying (x) the authenticity and validity of any such transaction
so acted upon by the Lender once the Lender has advanced funds
and has deposited or transferred such funds as requested in any
such Electronic Request or Advance Request by telecopy, and (y)
the Company's liability and responsibility therefor.
(2) In the case of any Wet Settlement Advances, the Company
shall follow the procedures and, at or prior to the Lender's
making of such Wet Settlement Advance, shall deliver to the
Lender or its designee the documents set forth in Section II of
Exhibit C hereto. In case of Collateral financed through a Wet
Settlement Advance, the Company shall cause all Collateral
Documents to be delivered to the Lender or its designee within
five (5) Business Days after the date of the Wet Settlement
Advance relating thereto.
(3) Before funding, the Lender and its designee shall have a
reasonable time to examine such Advance Request and the
Collateral Documents to be delivered prior to such requested
Advance, as set forth in the applicable Exhibit hereto, and may
reject such of them as do not meet the requirements of this
Agreement or of the related Purchase Commitment. The Advance
Request and the Collateral Documents must be received by Lender
no later than 2:00 p.m. Houston, Texas time in order for funding
to occur the same day.
(b) To make an Advance, the Lender shall credit the Funding
Account upon compliance by the Company with the terms of this
Agreement and shall upon the borrower's direction either issue a
certified check for such Advance or arrange a wire transfer.
2.3 Note. The Company's obligation to pay the principal of, and interest
on, all Advances made by the Lender shall be evidenced by a promissory note (the
"Note") of the Company dated as of the date hereof, in form of Exhibit hereto.
The term "Note" shall include all extensions, renewals and modifications of the
Note and all substitutions therefor. All terms and provisions of the Note are
hereby incorporated herein.
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2.4 Interest.
(a) The unpaid amount of each Advance shall bear interest from the
date of such Advance until paid in full, at the applicable Interest Rate;
provided, however, that portion of the unpaid Advances equal to the Net
Investable Balances shall bear interest at a rate equal to the Applicable
Margin.
(b) Interest shall be computed on the basis of a 360-day year and
applied to the actual number of days elapsed in each interest calculation
period and shall be payable monthly in arrears, on the first day of each
month, commencing with the first month following the date of this
Agreement, and ending on the Termination Date.
(c) Obligations not paid when due (whether at stated maturity, upon
acceleration following the occurrence of an Event of Default or otherwise)
shall bear interest, from the date due until paid in full, at a rate of
interest ("Default Rate") at all times equal to the lesser of (i) four
percent (4%) per annum over the Lender's prime rate; or (ii) the Maximum
Rate, said interest to be payable on demand by the Lender.
2.5 Principal Payments.
(a) The outstanding unpaid principal amount of all Advances shall be
payable in full upon the Termination Date.
(b) The Company shall have the right to prepay the outstanding
Advances in whole or in part, from time to time, without premium or
penalty.
(c) The Company shall be obligated to pay to the Lender, without the
necessity of prior demand or notice from the Lender (however Lender will
give prompt notice following any such change), and the Company authorizes
the Lender to charge the Funding Account or any other accounts of the
Company (excluding any monies held by Company in trust for third parties)
in Lender's possession for the amount of any outstanding Advance against a
specific Mortgage Loan, upon the earliest occurrence of any of the
following events:
(1) The expiration of ninety (90) days from the date of any
Advance for any Mortgage Loan (excluding Aged Mortgage Loans);
(2) The expiration of thirty (30) days from the date the Mortgage
Loan was delivered to an Investor for examination and purchase,
without the purchase being made, or upon rejection of the Mortgage
Loan as unsatisfactory by an Investor;
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(3) The expiration of five (5) Business Days from the date a Wet
Settlement Advance was made without receipt of all Collateral
Documents relating to such Mortgage Loan, or such Collateral
Documents, upon examination by the Lender, are found not to be in
compliance with the requirements of this Agreement or any related
Purchase Commitment;
(4) The expiration of two (2) Business Days from the date a
Subwarehouse Mortgage Loan Advance was made without receipt of a copy
of the Mortgage Note relating to such Subwarehouse Lender's Mortgage
Loan and with all necessary endorsements, or upon review, such
Mortgage Note and necessary endorsements are found not to be in
compliance with the requirements of this Agreement or any related
Purchase Commitment;
(5) The expiration of ten (10) Business Days from the date a
Collateral Document in connection with such Mortgage Loan was
delivered to the Company for correction or completion, without being
returned to the Lender, corrected or completed;
(6) The Mortgage Loan is in default and such default continues
for a period of sixty (60) days or more;
(7) The expiration of three (3) Business Days after the date on
which any related Purchase Commitment, if any, expires, is terminated
or otherwise canceled or no longer in full force and effect and the
specific Mortgage Loan was not delivered under the Purchase Commitment
prior to such termination, expiration or cancellation; or
(8) Upon sale of the Mortgage Loan.
Upon receipt of such payment by the Lender, such Mortgage Loans shall be
considered to have been redeemed from pledge, and the Collateral Documents
relating thereto which have not been delivered to the Investor or the pool
custodian or pool trustee shall be released by the Lender to the Company.
(d) With respect to Aged Mortgage Loans, the Company shall be
obligated to pay to the Lender (and the Company authorizes the Lender to
charge the Funding Account or any other accounts of the Company (excluding
monies held by the Company in trust for third parties) in Lender's
possession for the payment thereof) the principal payments in the amounts
and on the dates specified below:
(1) On the date a Pledged Mortgage becomes an Aged Mortgage Loan,
a principal payment in an amount necessary to reduce the outstanding
unpaid Advances made against such Aged Mortgage Loan to an amount
equal to [*] of the Collateral Value of such Aged Mortgage Loan to the
extent such Aged Mortgage Loan was
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originally a Subprime Mortgage Loan and [*] to the extent such
Aged Mortgage Loan was a Second Mortgage Loan;
(2) On the date an Aged Mortgage Loan has been included in
the Collateral for 121 days, a principal payment in an amount
necessary to reduce the outstanding unpaid Advances made against
such Aged Mortgage Loan to an amount equal to [*] of the
Collateral Value of such Aged Mortgage Loan to the extent such
Aged Mortgage Loan was originally a Subprime Mortgage Loan and
[*] to the extent such Aged Mortgage Loan was a Second Mortgage
Loan;
(3) On the date an Aged Mortgage Loan has been included in
the Collateral for 151 days, a principal payment in an amount
necessary to reduce the outstanding unpaid Advances made against
such Aged Mortgage Loan to an amount equal to [*] of the
Collateral Value of such Aged Mortgage Loan to the extent such
Aged Mortgage Loan was originally a Subprime Mortgage Loan and
[*] to the extent such Aged Mortgage Loan was originally a Second
Mortgage Loan;
(4) On the date an Aged Mortgage Loan has been included in
the Collateral for 181 days, an amount equal to the balance of
the aggregate outstanding unpaid Advances against such Aged
Mortgage Loan.
2.6 Expiration of Commitment. Unless extended or terminated earlier as
permitted hereunder, the Commitment shall expire of its own term, and without
the necessity of action by the Lender, at the close of business on the
Termination Date. However, the remainder of this Agreement shall remain in full
force and effect until all amounts due on the Obligations have been paid in
full. The Lender has not made, and does not hereby make, any commitment to
renew, extend, rearrange or otherwise refinance the outstanding and unpaid
principal of the Note or accrued interest thereon. In the event, however, the
Lender from time to time renews, extends, rearranges, increases and/or otherwise
refinances any portion or all of any Obligation and any accrued interest thereon
at any time, such refinancing shall be evidenced by an appropriate promissory
note in form and substance satisfactory to the Lender and, unless otherwise
noted or modified at such time or times by the terms of such promissory note or
any agreements executed in connection therewith, any such promissory note or
notes and refinancing evidenced thereby shall be governed in all respects by the
terms of this Agreement.
2.7 Method of Making Payments. Except as otherwise specifically provided
herein, all payments hereunder shall be made to the Lender not later than the
close of business (Houston time) on the date when due unless such date is a
non-Business Day, in which case, such payment shall be due on the first Business
Day thereafter, and shall be made in lawful money of the United States of
America in immediately available funds.
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2.8 Non-Usage Fee. At the end of each month during the term of this
Agreement (i.e., from its effective date through the Termination Date), the
Lender shall determine average usage of the Commitment by calculating the
arithmetic daily average of the outstanding balance of Advances in the preceding
month. The Lender shall then subtract the average usage (the "Used Portion")
from the Commitment (the result being called the "Unused Portion") and to the
extent that the Unused Portion exceeds fifty percent (50%) of the Commitment,
the Company shall pay in arrears (without duplication of payment), on or before
five (5) days after the Company's receipt of the Lender's xxxx for such monthly
period, a Non-Usage Fee equal to one quarter of one percent (0.25%) per annum of
such portion of the Unused Portion of the Commitment exceeds fifty (50%) of the
Commitment, as compensation to the Lender for its agreement to make the
Commitment available to the Company during that month and not as compensation
for the use, forbearance or detention of money (i.e., as a "true commitment fee"
under Texas law). Each calculation by the Lender of the amount of any Non-Usage
Fee shall be presumed conclusive and binding on the Company, absent manifest
error.
2.9 Miscellaneous Charges. At the end of each month during the term of this
Agreement, the Company shall pay to the Lender in arrears on or before five (5)
days after the later of (a) the end of each calendar month or (b) the Company's
receipt of the Lender's xxxx for such monthly period, a transaction fee equal to
[*] and No/100 Dollars [*] per Pledged Mortgage held by Lender during such month
and for which Lender has not previously received a transaction fee, for the
handling and administration of Advances and Collateral. For the purposes hereof,
Company shall, at its sole cost and expense, pay all reasonable, out-of-pocket
miscellaneous charges and expenses incurred by the Lender in connection with the
handling and administration of Advances and Collateral, including, without
limitation, all charges for security delivery fees and charges for overnight
delivery of Collateral to Investors. Miscellaneous charges are due when
incurred, but shall not be delinquent if paid within five (5) days after receipt
of an invoice or an account analysis statement from the Lender.
2.10 Bailee. Lender appoints Company, and Company shall act, as its bailee
to (i) hold in trust for Lender (A) the original recorded copy of the mortgage,
deed of trust, or trust deed securing each Pledged Mortgage, (B) a mortgagee
policy of title insurance (or binding unexpired and unconditional commitment to
issue such insurance if the policy has not yet been delivered to Company)
insuring the Company's perfected, first priority Lien created by that mortgage,
deed of trust, or trust deed, (C) the original insurance policies for each
Pledged Mortgage, and (D) all other original documents relating to each Pledged
Mortgage, including any promissory notes, any other loan documents, and
supporting documentation, surveys, settlement statements, closing instructions,
to the extent that any such documents are in the possession of the Company and
(ii) deliver to Lender any of the foregoing items immediately upon Lender's
request.
3. COLLATERAL.
3.1 Grant of Security Interest. As security for the payment of the Note and
for the performance of all of the Company's Obligations hereunder, the Company
hereby assigns and transfers all right, title and interest in and to and grants
a security interest to the Lender in the following described property, whether
now owned or hereafter acquired (the "Collateral"):
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(a) All Mortgage Loans including all Mortgage Notes and Mortgages
evidencing such Mortgage Loans in respect of which an Advance has been
made by Lender, including without limitation all Mortgage Loans in
respect of which Wet Settlement Advances have been made by the Lender,
which from time to time are delivered or caused to be delivered to the
Lender or its designee, come into the possession, custody or control
of the Lender for the purpose of assignment or pledge (the "Pledged
Mortgages").
(b) All private mortgage insurance and all commitments issued by
the FHA or VA to insure or guarantee any Mortgage Loans included in
the Pledged Mortgages; all Purchase Commitments held by the Company
covering the Pledged Mortgages and all proceeds resulting from the
sale thereof to Investors pursuant thereto; all personal property,
contract rights, servicing and servicing fees and income or other
proceeds, amounts and payments payable to the Company as compensation
or reimbursement, accounts and general intangibles of whatsoever kind
relating to the Pledged Mortgages, and all other documents or
instruments relating to the Pledged Mortgages, including, without
limitation, any interest of the Company in any fire, casualty or
hazard insurance policies and any awards made by any public body or
decreed by any court of competent jurisdiction for a taking or for
degradation of value in any eminent domain proceeding as the same
relate to the Pledged Mortgages.
(c) All right, title and interest of the Company in and to all
escrow accounts, documents, instruments, files, surveys, certificates,
correspondence, appraisals, computer programs, tapes, discs, cards,
accounting records (including all information, records, tapes, data,
programs, discs and cards necessary or helpful in the administration
or servicing of the foregoing Collateral) and other information and
data of the Company relating to the foregoing Collateral.
(d) All now existing or hereafter acquired cash delivered to or
otherwise in the possession of the Lender or its agent, bailee or
custodian or designated on the books and records of the Company as
assigned and pledged to the Lender.
(e) All Chattel Paper, Instruments, General Intangibles,
Certificated Securities, Uncertificated Securities and Investment
Property, as those terms are defined in the Texas Uniform Commercial
Code, arising from the foregoing Collateral.
(f) All cash and non-cash proceeds of the foregoing Collateral,
including all dividends, distributions and other rights in connection
with, and all additions to, modifications of and replacements for, the
foregoing Collateral, and all products and proceeds of the foregoing
Collateral, together with whatever is receivable or received when the
foregoing Collateral or proceeds thereof are sold, collected,
exchanged or otherwise disposed of, whether such disposition is
voluntary or involuntary, including, without limitation, all rights to
payment with
18
respect to any cause of action affecting or relating to the foregoing
Collateral or proceeds thereof.
3.2 Delivery of Collateral Documents. The Lender or its designee
exclusively shall deliver Pledged Mortgages to an Investor for its examination
and purchase. In such cases where the Lender must deliver documents to an
Investor, the Lender must receive signed shipping instructions (in the form of
Exhibit attached hereto), no later than 2:00 p.m. Houston, Texas time one (1)
Business Day prior to the expiration of the appended Purchase Commitment. If
shipping instructions are received by Lender before 2:00 p.m. Houston, Texas
time of any Business Day, Lender will ship the documents together with the
Bailee Letter (in form of Exhibit) to the Investor on the same Business Day,
otherwise Lender will ship the documents the next Business Day following receipt
of shipping instructions. The Lender may deliver any document relating to the
Collateral to the Company for correction or completion against a trust receipt
in the form of Exhibit attached hereto executed by the Company. The Company
hereby represents and warrants to and agrees with the Lender that any request by
the Company for release of the Collateral consisting of or relating to Mortgage
Loans to the Company shall be solely for the purposes of correcting clerical or
non-substantial documentation problems in preparation for returning such
Collateral to the Lender for ultimate sale or exchange and the aggregate
Collateral Value of the Collateral released to the Company pursuant to this
Section 3.2 will not exceed Five Hundred Thousand Dollars ($500,000.00) the
Company shall request such release in compliance with all of the terms and
conditions of such release set forth herein; and the Company will return to the
Lender such documentation released to the Company pursuant to this Section 3.2
within ten (10) Business Days after such delivery.
3.3 Delivery of Additional Collateral or Mandatory Prepayment. At any time
that the aggregate Collateral Value of the Collateral then pledged hereunder is
less than the aggregate amount of the Advances then outstanding hereunder, the
Lender may request, and the Company shall within two (2) Business Days after
Notice by the Lender (a) deliver to the Lender or its designee for pledge
hereunder additional Mortgage Loans and/or cash, in aggregate amounts sufficient
to cover the difference between the Collateral Value of the Collateral pledged
and the aggregate amount of Advances outstanding hereunder, or (b) repay the
Advances in an amount sufficient to reduce the aggregate balance thereof
outstanding to an amount equal to or below the Collateral Value of the
Collateral pledged hereunder.
3.4 Right of Redemption from Pledge. So long as no Event of Default has
occurred, the Company may redeem a Mortgage Loan, Mortgage-backed Security, by
notifying the Lender of its intention to redeem such Mortgage Loan,
Mortgage-backed Security, from pledge and by paying, or causing an Investor to
pay, to the Lender, for application to prepayment of the principal balance of
the Note, an amount (the "Redemption Amount") equal to the Collateral Value of
the Mortgage Loan, to be released as of the date of such application, but, in
the case of a Pledged Mortgage Loan, not less than the amount of the Advance
made with respect to or relating to such Mortgage Loan or Mortgage-backed
Security.
3.5 Collection and Servicing Rights. So long as no Event of Default shall
have occurred and be continuing , the Company shall be entitled to service and
receive and collect directly all sums payable to the Company in respect of the
Collateral other than proceeds of any
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Purchase Commitment or proceeds of the sale of any Collateral. Following the
occurrence and during the continuance of any Event of Default, the Lender or its
designee shall thereafter be entitled to service and receive and collect all
sums payable to the Company in respect of the Collateral, and in such case (a)
the Lender or its designee in its discretion may, in its own name or in the name
of the Company or otherwise, demand, xxx for, collect or receive any money or
property at any time payable or receivable on account of or in exchange for any
of the Collateral, but shall be under no obligation to do so, (b) the Company
shall, if the Lender so requests, forthwith pay to the Lender at its principal
office all amounts thereafter received by the Company upon or in respect of any
of the Collateral, advising the Lender as to the source of such funds, and (c)
all amounts so received and collected by the Lender shall be held by it as part
of the Collateral.
3.6 Return or Release of Collateral at End of Commitment. If (a) the
Commitment shall have expired or been terminated, and (b) no Advances, interest
or other Obligations evidenced by the Loan Documents or due under this Agreement
shall be outstanding and unpaid, the Lender shall deliver or release all
Collateral in its possession to the Company. The receipt of the Company for any
Collateral released or delivered to the Company pursuant to any provision of
this Agreement shall be a complete and full acquittance for the Collateral so
returned, and the Lender shall thereafter be discharged from any liability or
responsibility therefor.
4. CONDITIONS PRECEDENT.
4.1 Initial Advance. The obligation of the Lender to make the initial
Advance under this Agreement is subject to the satisfaction, in the sole
discretion of the Lender, on or before the date thereof, of the following
conditions precedent:
(a) The Lender shall have received the following, all of which
must be satisfactory in form and content to the Lender, in its sole
discretion:
(1) The Loan Documents dated as of the date hereof duly
executed by the Company;
(2) Certified copies of each Company's articles of formation
and membership agreement and certificates of good standing dated
no less recently than ninety (90) days prior to the date of this
Agreement and a certification from the taxing authority of the
state of formation stating that the Company is in good standing
with said taxing authority;
(3) An original resolution of the members of each Company,
certified as of the date of this Agreement by the Company's
managing member, authorizing the execution, delivery and
performance of this Agreement and the other Loan Documents, and
all other instruments or documents to be delivered by the Company
pursuant to this Agreement;
(4) A certificate (in the form of Exhibit J) of each
Company's managing member as to the resolution of the members of
each Company
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authorizing the execution, delivery and performance of this
Agreement and the other Loan Documents and the incumbency and
authenticity of the signatures of the officers of the Company
executing this Agreement and the other Loan Documents and each
Advance Request and all other instruments or documents to be
delivered pursuant hereto (the Lender being entitled to rely
thereon until a new such certificate has been furnished to the
Lender);
(5) Consolidated Financial statements of the Company (and
their Subsidiaries, on a consolidated basis) containing an
audited balance sheet as of November 15, 1999 (the "Statement
Date") and related statements of income, changes in partners'
equity and cash flows for the period ended on the Statement Date,
all prepared in accordance with GAAP applied on a basis
consistent with prior periods and in the case of the statements
as of the Statement Date, audited by independent certified public
accountants of recognized standing acceptable to the Lender;
(6) A favorable written opinion of outside counsel to the
Company, dated as of the date of this Agreement, to be in
substantially the form of Exhibit M hereto, and addressed to the
Lender;
(7) A tax, lien and judgment search of the appropriate
public records for each Company, including a search of Uniform
Commercial Code financing statements, which search shall not have
disclosed the existence of any prior Lien on the Collateral other
than in favor of the Lender or as permitted hereunder;
(8) Copies of the certificates, documents or other written
instruments which evidence each Company's eligibility described
in Section 5.11 hereof, all in form and substance satisfactory to
the Lender;
(9) Copies of Bane NLC's errors and omissions insurance
policy or mortgage impairment insurance policy and blanket bond
coverage policy, all in form and content satisfactory to the
Lender, showing compliance by the Company as of the date of this
Agreement with the related provisions of Section 6.8 hereof and
showing Lender as an additional loss payee on such policies;
(10) Executed financing statements in recordable form
covering the Collateral and ready for filing in all jurisdictions
required by the Lender;
(11) Evidence that the Funding Account has been established
with the Lender.
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4.2 Each Advance. The obligation of the Lender to make the initial and each
subsequent Advance under this Agreement is subject to the satisfaction, in the
sole discretion of the Lender, as of the date of each such Advance, of the
following additional conditions precedent:
(a) In connection with an Advance, the Company shall have
delivered to the Lender the Advance Request or the Electronic Request,
Collateral Documents, and documents required under and shall have
satisfied the procedures set forth in Section 2.2 and Exhibit C,
according to the type of Collateral to be financed through the
requested Advance. All items delivered to the Lender or its designee
shall be satisfactory to the Lender in form and content, and the
Lender may reject such of them as do not meet the requirements of this
Agreement or of any related Purchase Commitment.
(b) The Lender shall have received evidence satisfactory to it as
to the making and/or continuation of any book entry or the due filing
and recording in all appropriate offices of all financing statements
and other instruments as may be necessary to perfect the security
interest of the Lender in the Collateral under the Uniform Commercial
Code of Texas or other applicable law.
(c) The representations and warranties of the Company contained
in Article 5 hereof shall be accurate and complete in all material
respects as if made on and as of the date of each Advance.
(d) The Company shall have performed all agreements to be
performed by it hereunder and, as of the date of the Advance Request,
and after giving effect to the requested Advance, there shall exist no
Default or Event of Default hereunder.
(e) The Company shall not have incurred any material liabilities,
direct or contingent, except as approved by Lender pursuant to Section
7.17, since the dates of the Company's most recent financial
statements theretofore delivered to the Lender.
(f) The Lender shall have received from counsel for the Company,
if requested by the Lender in its sole discretion, an updated opinion,
in form and substance satisfactory to the Lender, addressed to the
Lender and dated as of the date of such Advance, covering such of the
matters as the Lender may reasonably request.
(g) Such additional documents, instruments, and information as
Lender or its legal counsel may require.
Acceptance of the proceeds of the requested Advance by the Company shall be
deemed a representation by the Company that all conditions set forth in this
Article 4 shall have been satisfied as of the date of such Advance.
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5. REPRESENTATIONS AND WARRANTIES.
The Company hereby represents and warrants to the Lender, as of the date of
this Agreement and (unless otherwise notified in writing by the Company and
Lender, in its sole discretion, approves in writing) as of the date of each
Advance Request and the making of each Advance, that:
5.1 Organization; Good Standing; Subsidiaries. Each Company is a limited
liability company duly organized, validly existing and in good standing under
the laws of the jurisdiction of its formation, has the full legal power and
authority to own its property and to carry on its business as currently
conducted and is duly qualified as a foreign entity to do business and is in
good standing in each jurisdiction in which the transaction of its business
makes such qualification necessary, except in jurisdictions, if any, where a
failure to be in good standing has no material adverse effect on the business,
operations, assets or financial condition of the Company or any such Subsidiary.
For the purposes hereof, good standing shall include qualification for any and
all licenses and payment of any and all taxes required in the jurisdiction of
its formation and in each jurisdiction in which the Company transacts business.
The Company has no Subsidiaries except as set forth on Exhibit G hereto. Exhibit
G sets forth with respect to each such Subsidiary, its name, address, place of
incorporation or formation, each state in which it is qualified as a foreign
corporation or other entity, and the percentage ownership of the Company in such
Subsidiary.
5.2 Authorization and Enforceability. Each Company has all requisite power
and authority to execute, deliver, create, issue, comply and perform this
Agreement, the Note and all other Loan Documents to which the Company is party
and to make the borrowings hereunder. The execution, delivery and performance by
the Company of this Agreement, the Note and all other Loan Documents to which
the Company is party and the making of the borrowings hereunder and thereunder,
have been duly and validly authorized by all necessary action on the part of the
Company (none of which actions has been modified or rescinded, and all of which
actions are in full force and effect) and do not and will not conflict with or
violate any provision of law or of the Articles of Formation of the Company,
conflict with or result in a breach of or constitute a default or require any
consent under any contracts to which Company is a party, or result in the
creation of any Lien upon any property or assets of the Company other than the
Lien on the Collateral granted hereunder, or result in or require the
acceleration of any Indebtedness of the Company pursuant to any agreement,
instrument or indenture to which the Company is a party or by which the Company
or its property may be bound or affected. This Agreement, the Note and all other
Loan Documents contemplated hereby or thereby constitute legal, valid, and
binding obligations of the Company, enforceable in accordance with their
respective terms, except as limited by bankruptcy, insolvency or other such laws
affecting the enforcement of creditors' rights generally.
5.3 Financial Condition. The Consolidated balance sheet of the Company
provided to Lender pursuant to Section 4.1(a)(5) hereof (and if applicable, its
Subsidiaries, on a consolidating and consolidated basis) as at the Statement
Date, and the related statements of income, changes in partners' equity, and
cash flows for the fiscal year ended on the Statement Date, heretofore
23
furnished to the Lender, fairly present the financial condition of the Company
and its Subsidiaries as at the Statement Date and the Interim Date and the
results of its and their operations for the fiscal period ended on the Statement
Date and the Interim Date. The Company had, on the Statement Date and the
Interim Date, no known material liabilities, direct or indirect, fixed or
contingent, matured or unmatured, or liabilities for taxes, long-term leases or
unusual forward or long-term commitments not disclosed by, or reserved against
in, said balance sheet and related statements, and at the present time there are
no material unrealized or anticipated losses from any loans, advances or other
commitments of the Company except as heretofore disclosed to the Lender in
writing. Said financial statements were prepared in accordance with GAAP applied
on a consistent basis throughout the periods involved. Since the Statement Date,
there has been no material adverse change in the business, operations, assets or
financial condition of the Company or its Subsidiaries, nor is the Company aware
of any state of facts particular to the Company which (with or without notice or
lapse of time or both) would or could result in any such material adverse
change.
5.4 Litigation. Except as disclosed on Exhibit H, there are no actions,
claims, suits or proceedings pending, or to the knowledge of the Company,
threatened or reasonably anticipated against or affecting the Company or any
Subsidiary of the Company in any court or before any arbitrator or before any
government commission, board, bureau or other administrative agency which, if
adversely determined, may reasonably be expected to result in any material and
adverse change in the business, operations, assets or financial condition of the
Company .
5.5 Compliance with Laws. To the knowledge of Company, neither the Company
nor any Subsidiary of the Company is in violation of any provision of any law,
or of any judgment, award, rule, regulation, order, decree, writ or injunction
of any court or public regulatory body or authority which might have a material
adverse effect on the business, operations, assets or financial condition of the
Company or any of Company's Subsidiaries, as a whole.
5.6 Regulation U. The Company is not engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying Margin Stock, and no part of the proceeds of any Advances
made hereunder will be used to purchase or carry any Margin Stock or to extend
credit to others for the purpose of purchasing or carrying any Margin Stock.
5.7 Investment Company Act. Neither the Company nor any of its Subsidiaries
is an "investment company" or controlled by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
5.8 Agreements. Neither the Company nor any Subsidiary of the Company is a
party to any agreement, instrument or indenture, or subject to any restriction,
materially and adversely affecting its business, operations, assets or financial
condition, except as disclosed in the financial statements described in Section
5.3 hereof. The Company and each Subsidiary of the Company are not in default in
the performance, observance or fulfillment of any of the obligations, covenants
or conditions contained in any agreement, instrument, or indenture which
24
default could have a material adverse effect on the business, operations,
properties or financial condition of the Company as a whole. No holder of any
Indebtedness of the Company or of any of its Subsidiaries has given notice of
any alleged default thereunder or, if given, the same has been cured or will be
cured by Company within the cure period provided therein, and no liquidation or
dissolution of the Company or any of its Subsidiaries and no receivership,
insolvency, bankruptcy, reorganization or other similar proceedings relative to
the Company or any of its Subsidiaries or any of their respective properties is
pending, or to the knowledge of the Company, threatened.
5.9 Title to Properties. The Company and each Subsidiary of the Company has
good, valid, insurable (in the case of real property) and marketable title to
all of its properties and assets (whether real or personal, tangible or
intangible) reflected on the financial statements described in Section 5.3
hereof, and all such properties and assets are free and clear of all Liens
except as disclosed in such financial statements and the Liens in favor of the
lenders set forth on Exhibit B hereto and not prohibited under this Agreement.
5.10 ERISA. All plans ("Plans") of a type described in Section 3(3) of
EPISA in respect of which the Company or any Subsidiary of the Company is an
"Employer," as defined in Section 3(5) of ERISA, are in substantial compliance
with ERISA, and none of such Plans is insolvent or in reorganization, has an
accumulated or waived funding deficiency within the meaning of Section 412 of
the Internal Revenue Code, and neither the Company nor any Subsidiary of the
Company has incurred any material liability (including any material contingent
liability) to or on account of any such Plan pursuant to Sections 4062, 4063,
4064, 4201 or 4204 of ERISA; and no proceedings have been instituted to
terminate any such Plan, and no condition exists which presents a material risk
to the Company or a Subsidiary of the Company of incurring a liability to or on
account of any such Plan pursuant to any of the foregoing Sections of ERISA. No
Plan or trust forming a part thereof has been terminated since December 1, 1974.
5.11 Eligibility. Each Company has all requisite power and authority and
all necessary licenses, permits, franchises and other authorizations to own and
operate its property and to carry on its business as now conducted. If approved
now or hereafter as a lender or seller/servicer for any one or more of the
governmental agencies as set forth below, the Company will remain at all times
approved and qualified and in good standing and meet all requirements applicable
to such status
5.12 Special Representations Concerning Collateral. Each Company hereby
represents and warrants to the Lender, as of the date of this Agreement and as
of the date of each Advance, that:
(a) With the exception of Subwarehouse Mortgage Loans prior to
assignment by NLCI, the Company is the legal and equitable owner and
holder, free and clear of all Liens (other than Liens granted
hereunder), of the Pledged Mortgages. All Pledged Mortgages and
Purchase Commitments have been duly authorized and validly granted or
issued to the Company, and all of the foregoing items of Collateral
comply with all of the requirements of this Agreement, and have been
validly pledged or assigned to the Lender, subject to no other Liens.
25
(b) The Company has, and will continue to have, the full right,
power and authority to pledge the Collateral pledged and to be pledged
by it hereunder.
(c) Any Mortgage Loan and related documents included in the
Pledged Mortgages (1) as of the date of the Advance Request for such
Mortgage Loan, has been duly executed and delivered by the parties
thereto at a closing held not more than sixty (60) days prior to such
date; (2) has been made in compliance with all requirements of the
Real Estate Settlement Procedures Act, Equal Credit Opportunity Act,
the federal Truth-In-Lending Act and all other applicable laws and
regulations; (3) is valid and enforceable in accordance with its
terms, without defense or offset; (4) has not been modified or amended
except in writing, which writing is part of the Collateral Documents,
nor any requirements thereof waived; and (5) complies with the terms
of this Agreement and, if applicable, with the related Purchase
Commitment held by the Company. Each Mortgage Loan has been fully
advanced in the face amount thereof and each Mortgage creates a Lien
on the premises described therein.
(d) No monetary default, nor, to the knowledge of the Company,
any event which, with notice or lapse of time or both, would become a
default, has occurred and is continuing under any Mortgage Loan
included in the Pledged Mortgages; provided, however, that, with
respect to Pledged Mortgages which have already been pledged as
Collateral hereunder, if any such default or event has occurred, the
Company will promptly notify the Lender and the same shall not have
continued for more than sixty (60) days.
(e) All fire and casualty policies covering Mortgaged Property
encumbered by a Pledged Mortgage (1) name the Company and its
successors and assigns as the insured under a standard mortgagee
clause, (2) are and will continue to be in full force and effect, and
(3) afford and will continue to afford insurance against fire and such
other risks as are usually insured against in the broad form of
extended coverage insurance from time to time available, as well as
insurance against flood hazards if the same is required.
(f) Pledged Mortgages encumbering Mortgaged Property located in a
special flood hazard area designated as such by the Secretary of HUD
are and shall continue to be covered by special flood insurance under
the National Flood Insurance Program.
(g) Each Pledged Mortgage is supported by an appraisal that meets
the appraisal requirements of FNMA or FHLMC (in the case of
residential Mortgaged Property), or the Office of Thrift Supervision
for the type of Mortgaged Property securing that Pledged Mortgage.
5.13 RICO. The Company is not in violation of any laws, statutes or
regulations, including, without limitation, RICO, which contain provisions which
could potentially override Lender's security interest in the Collateral.
26
5.14 Proper Names. The Company does not operate in any jurisdiction under a
trade name, division, division name or name other than those names set forth on
Exhibit H attached hereto and all such names included on Exhibit H are utilized
by the Company only in the jurisdictions listed therein.
5.15 Direct Benefit From Loans. The Company has received, or, upon the
execution and funding thereof, will receive (a) direct benefit from the making
and execution of this Agreement and the other Loan Documents to which it is a
party, and (b) fair and independent consideration for the entry into, and
performance of, this Agreement and the other Loan Documents to which it is a
party. Contemporaneously with the disbursements of each Advance by the Lender to
the Company, all such proceeds will be used to finance the origination or
purchase of Mortgage Loans.
5.16 Loan Documents Do Not Violate Other Documents. Neither the execution
and delivery by the Company of this Agreement or any other Loan Document to
which it is a party nor the consummation of the transactions herein and therein
contemplated, nor the performance of, or compliance with, the terms and
provisions hereof and thereof, does or will contravene, breach or conflict with
any provision of either of its Articles of Formation, or any applicable law,
statute, rule or regulation or any judgment, decree, writ, injunction,
franchise, order or permit applicable to the Company or its assets or
properties, or does or will conflict or be inconsistent with, or does or will
result in any breach or default of, any of the terms, covenants, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of any Lien upon any of the property or assets of the Company
pursuant to the terms of any indenture, mortgage, deed of trust, loan agreement,
or other instrument to which the Company is a party or by which the Company or
any of its property may be bound, the contravention, conflict, inconsistency,
breach or default of which will have a materially adverse effect on the
Company's condition, financial or otherwise, or affect its ability to perform,
promptly and fully, its obligations hereunder or under any of the other Loan
Documents.
5.17 Consents Not Required. Except for those consents that have already
been obtained and delivered to Lender or required as a condition to any Advance
hereunder, no consent of any Person and no consent, license, permit, approval,
or authorization of, exemption by, or registration or declaration with, any
Tribunal is required in connection with the execution, delivery, performance,
validity, or enforceability of this Agreement or any of the Loan Documents by
the Company.
5.18 Material Fact Representations. Neither the Loan Documents nor any
other agreement, document, certificate, or written statement furnished to the
Lender by or on behalf of the Company in connection with the transactions
contemplated in any of the Loan Documents contains any untrue statement of a
material adverse fact. There are no material adverse facts or conditions
relating to the making of the Commitment, any of the Collateral, and/or the
financial condition and business of the Company known to the Company which have
not been fully disclosed, in writing, to the Lender, it being understood that
this representation is made as of, and shall be limited to the date of this
Agreement. All writings heretofore or hereafter exhibited or delivered to the
Lender by or on behalf of the Company are and will be genuine and what they
purport to be.
27
5.19 Place of Business. The principal place of business of the Company is
000 Xxxx Xxxxxxxxxxxx Xxxxxxxxx, Xxxxxxxxx Xxxxx, Xxxxxxx 00000, and the chief
executive office of the Company and the office where it keeps its financial
books and records relating to its property and all contracts relating thereto
and all accounts arising therefrom is located at the address set forth for the
Company in Section 9 hereof.
5.20 Use of Proceeds; Business Loans. The Company will use the proceeds of
the Advances made pursuant to the Commitment solely as follows, and for no other
purpose: finance the origination and purchase of Mortgage Loans. All loans
evidenced by the Note are and shall be "business loans", as such term is used in
the Depository Institutions Deregulation and Monetary Control Act of 1980, as
amended, and such loans are for business or commercial purposes and not
primarily for personal, family, household or agricultural use, as such terms are
used or defined in Texas Revised Civil Statutes, Texas Finance Code, Regulation
Z promulgated by the Board of Governors of the Federal Reserve System, and
Titles I and V of the Consumer Credit Protection Act. The provisions of the
Texas Finance Code which regulate revolving loans and revolving triparty
accounts) shall not apply to this Agreement.
5.21 No Undisclosed Liabilities. Other than as permitted in Section 7.17
hereof, the Company does not have any liabilities or Indebtedness, direct or
contingent, except for liabilities or Indebtedness which, in the aggregate, do
not exceed Twenty-Five Thousand Dollars ($25,000.00).
5.22 Tax Returns and Payments. All federal, state and local income, excise,
property and other tax returns required to be filed with respect to Company's
operations and those of its Subsidiaries in any jurisdiction have been filed on
or before the due date thereof (plus any applicable extensions); all such
returns are true and correct; all taxes, assessments, fees and other
governmental charges upon the Company, and Company's Subsidiaries and upon its
property, income or franchises, which are due and payable have been paid,
including, without limitation, all FICA payments and withholding taxes, if
appropriate, other than those which are being contested in good faith by
appropriate proceedings, diligently pursued and as to which the Company has
established adequate reserves determined in accordance with GAAP, consistently
applied. The amounts reserved, as a liability for income and other taxes
payable, in the financial statements described in Section 5.3 hereof are
sufficient for payment of all unpaid federal, state and local income, excise,
property and other taxes, whether or not disputed, of the Company and its
Subsidiaries, accrued for or applicable to the period and on the dates of such
financial statements and all years and periods prior thereto and for which the
Company, and Company's Subsidiaries may be liable in their own right or as
transferee of the assets of, or as successor to, any other Person.
5.23 Subsidiaries. The Company has not issued, and does not have
outstanding, any warrants, options, rights or other obligations to issue or
purchase any of its partnership interests or other securities. The outstanding
partnership interests of the Company have been duly authorized and validly
issued and are fully paid and nonassessable. All of Company's Subsidiaries are
listed on Exhibit H, attached hereto.
28
5.24 Holding Company. The Company is not a "holding company" or a
"subsidiary company" of a "holding company" within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
5.25 Year 2000 Issue. The Company and its Subsidiaries have reviewed the
effect of the year 2000 Issue on the computer software, hardware, and firmware
systems and equipment containing embedded microchips owned or operated by or for
the Company and its Subsidiaries or used or relied upon in the conduct of their
business (including systems and equipment supplied by others or with which such
computer systems of the Company and its Subsidiaries interface). The Company and
its Subsidiaries have reviewed and determined that the costs to the Company and
its Subsidiaries of any reprogramming required as a result of the Year 2000
Issue to permit the proper functioning of such systems and equipment and the
proper processing of data, and the testing of such reprogramming, and of the
reasonably foreseeable consequences of the year 2000 Issue to the Company or any
of its Subsidiaries (including reprogramming errors and the failure of systems
or equipment supplied by others), are not reasonably expected to result in a
Default or Event of Default or to have a material adverse effect on the
business, assets, operations, prospects, or condition (financial or otherwise)
of the Company or its Subsidiaries.
6. AFFIRMATIVE COVENANTS.
The Company hereby covenants and agrees that, so long as the Commitment is
outstanding or there remain any Obligations of the Company to be paid or
performed under this Agreement or under any other Loan Document, the Company
shall:
6.1 Payment of Note. Punctually pay or cause to be paid the principal of,
interest on and all other amounts payable hereunder and under the Note in
accordance with the terms thereof.
6.2 Financial Statements and Other Reports. Deliver to the Lender:
(a) As soon as available and in any event within thirty (30) days
after the end of each calendar month, statements of income and changes
in partners' equity and cash flow of the Company and, if applicable,
Company's Subsidiaries, on a consolidated and consolidating basis for
the immediately preceding month, and related balance sheet as at the
end of the immediately preceding month, all in reasonable detail,
prepared in accordance with GAAP applied on a consistent basis, and
certified as to the fairness of presentation by the president and
chief financial officer of the Company, subject, however, to year-end
audit adjustments.
(b) As soon as available and in any event within ninety (90) days
after the close of each fiscal year: statements of income, changes in
partners' equity and cash flows of the Company, and, if applicable,
Company's Subsidiaries, on a consolidated and consolidating basis for
such year, the related balance sheet as at the end of such year
(setting forth in comparative form the corresponding figures for the
preceding fiscal year), all in reasonable detail, prepared in
accordance with GAAP applied on a consistent basis throughout the
periods involved, and
29
accompanied by an opinion in form and substance satisfactory to the
Lender and prepared by an accounting firm reasonably satisfactory to
the Lender, or other independent certified public accountants of
recognized standing selected by the Company and acceptable to the
Lender, as to said financial statements and a certificate signed by
the president and chief financial officer of the Company stating that
said financial statements fairly present the financial condition and
results of operations of the Company and, if applicable, Company's
Subsidiaries as at the end of, and for, such year.
(c) Together with each delivery of financial statements required
in this Section 6.2, an Officer's Certificate in substantially the
form of Exhibit F hereto.
(d) Reports in respect of the Pledged Mortgages, in such detail
and at such times as the Lender in its discretion may request at any
time or from time to time, including, without limitation, a monthly
pipeline report in form satisfactory to Lender, to be delivered with
the monthly financial statements required in Section 6.2(a).
(e) Copies of all regular or periodic financial and other
reports, if any, which the Company shall file with the Securities and
Exchange Commission or any governmental agency successor thereto and
copies of any audits or forms filed with any other governmental
entity.
(f) From time to time, with reasonable promptness, such further
information regarding the business, operations, properties or
financial condition of the Company as the Lender may reasonably
request.
6.3 Maintenance of Existence; Conduct of Business. Preserve and maintain
its existence in good standing and all of its rights, privileges, licenses and
franchises necessary in the normal conduct of its business, including, without
limitation, its eligibility as lender, seller/servicer and issuer described
under Section 5.11 hereof, and, without the Lender's prior written consent, make
no material change in the nature or character of its business or engage in any
business in which it was not engaged, or which is not reasonably related to such
business, on the date of this Agreement.
6.4 Compliance with Applicable Laws. Comply with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority, a
breach of which could materially adversely affect its business, operations,
assets, or financial condition, except where contested in good faith and by
appropriate proceedings, and with sufficient reserves established therefor.
6.5 Inspection of Properties and Books. Permit authorized representatives
of the Lender to (a) discuss the business, operations, assets and financial
condition of the Company and Company's Subsidiaries with their officers and
employees and to examine their books of account, records, reports and other
papers and make copies or extracts thereof, and (b) inspect all of the Company's
property and all related information and reports at Lender's expense, all at
30
such reasonable times as the Lender may request. The Company will provide its
accountants with a copy of this Agreement promptly after the execution hereof
and will instruct its accountants to answer candidly any and all questions that
the officers of the Lender or any authorized representatives of the Lender may
address to them in reference to the financial condition or affairs of the
Company and Company's Subsidiaries. The Company may have its representatives in
attendance at any meetings between the officers or other representatives of the
Lender and the Company accountants held in accordance with this authorization.
6.6 Notice. Give prompt written notice to the Lender of (a) any action,
suit or proceeding instituted by or against the Company or any of its
Subsidiaries in any federal or state court or before any commission or other
regulatory body (federal, state or local, domestic or foreign) which action,
suit or proceeding has at issue in excess of Twenty-Five Thousand Dollars
($25,000.00) (except for normal collection and foreclosure proceedings initiated
by the Company in connection with a Mortgage Loan or any other mortgage loan),
or any such proceedings threatened against the Company, or any of Company's
Subsidiaries in writing containing the details thereof, (b) the filing,
recording or assessment of any federal, state or local tax Lien against it, or
any of its assets or any of its Subsidiaries, (c) the occurrence of any Event of
Default hereunder or the occurrence of any Default and continuation thereof for
five (5) days, (d) the suspension, revocation or termination of the Company's
eligibility, in any respect, as approved lender, seller/servicer or issuer as
described under Section 5.11 hereof, (e) the transfer, loss or termination of
any Servicing Contract to which the Company is a party, or which is held for the
benefit of the Company, and the reason for such transfer, loss or termination,
if known to the Company, and (f) any other action, event or condition of any
nature which may lead to or result in a material adverse effect upon the
business, operations, assets, or financial condition of the Company or Company's
Subsidiaries or which, with or without notice or lapse of time or both, would
constitute a default under any other agreement instrument or indenture to which
the Company is a party or to which the Company its properties or assets may be
subject.
6.7 Payment of Indebtedness, Taxes, etc. Pay and perform all obligations
and Indebtedness of the Company, and cause to be paid and performed all
obligations and Indebtedness of its Subsidiaries in accordance with the terms
thereof and pay and discharge or cause to be paid and discharged all taxes,
assessments and governmental charges or levies imposed upon the Company or its
Subsidiaries, or upon their respective income, receipts or properties before the
same shall become past due, as well as all lawful claims for labor, materials
and supplies or otherwise which, if unpaid, might become a Lien or charge upon
such properties or any part thereof; provided, however, that the Company and its
Subsidiaries shall not be required to pay obligation, Indebtedness, taxes,
assessments or governmental charges or levies or claims for labor, materials or
supplies for which the Company or its Subsidiaries shall have obtained an
adequate bond or adequate insurance or which are being contested in good faith
and by proper proceedings which are being reasonably and diligently pursued if
such proceedings do not involve any likelihood of the sale, forfeiture or loss
of any such property or any interest therein while such proceedings are pending,
and provided further that book reserves adequate under generally accepted
accounting principles shall have been established with respect thereto
31
and provided further that the owing Person's title to, and its right to use, its
property is not materially adversely affected thereby.
6.8 Insurance. Maintain (a) errors and omissions insurance or mortgage
impairment insurance and blanket bond coverage, with such companies and in such
amounts as satisfy prevailing requirements applicable to a qualified mortgage
originating institution, and (b) liability insurance and fire and other hazard
insurance on its properties, with responsible insurance companies approved by
the Lender, in such amounts and against such risks as is customarily carried by
similar businesses operating in the same vicinity; and (c) within thirty (30)
days after notice from the Lender, obtain such additional insurance as the
Lender shall reasonably require, all at the sole expense of the Company. Copies
of such policies shall be furnished to the Lender without charge upon obtaining
such coverage or any renewal of or modification to such coverage.
6.9 Closing Instructions. Indemnify and hold the Lender harmless from and
against any loss, including reasonable attorneys' fees and costs, attributable
to the failure of a title insurance company, agent or attorney to comply with
the disbursement or instruction letter or letters of the Company or of the
Lender relating to any Mortgage Loan. The Lender shall have the right to
pre-approve the closing instructions of the Company to the title insurance
company, agent or attorney in any case where the Mortgage Loan to be created at
settlement is intended to be warehoused by the Company pursuant hereto.
6.10 Other Loan Obligations. Perform all obligations under the terms of
each loan agreement, note, mortgage, security agreement or debt instrument by
which the Company is bound or to which any of its property is subject, and
promptly notify the Lender in writing of a declared default under or the
termination, cancellation, reduction or non-renewal of any of its other lines of
credit or financing agreements with any other lender. Exhibit B hereto is a true
and complete list of all such lines of credit or financing agreements as of the
date hereof.
6.11 Use of Proceeds of Advances. Use the proceeds of each Advance solely
for the purpose of financing or purchasing Pledged Mortgages.
6.12 Special Affirmative Covenants Concerning Collateral.
(a) Warrant and defend the right, title and interest of the
Lender in and to the Collateral against the claims and demands of all
Persons whomsoever.
(b) Service or cause to be serviced all Pledged Mortgages in
accordance with the standard requirements of the issuers of Purchase
Commitments covering the same, including without limitation taking all
actions necessary to enforce the obligations of the obligors under
such Mortgage Loans. The Company shall hold all escrow funds collected
in respect of Pledged Mortgages in trust, without commingling the same
with non-custodial funds, and apply the same for the purposes for
which such funds were collected.
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(c) Execute and deliver to the Lender such Uniform Commercial
Code financing statements with respect to the Collateral as the Lender
may request. The Company shall also execute and deliver to the Lender
such further instruments of sale, pledge or assignment or transfer,
and such powers of attorney, as required by the Lender to secure the
Collateral, and shall do and perform all matters and things necessary
or desirable to be done or observed, for the purpose of effectively
creating, maintaining and preserving the security and benefits
intended to be afforded the Lender under this Agreement. The Lender
shall have all the rights and remedies of a secured party under the
Uniform Commercial Code of Texas, or any other applicable law, in
addition to all rights provided for herein.
(d) Notify the Lender within two (2) Business Days after receipt
of notice from an Investor of any default under, or of the termination
of, any Purchase Commitment relating to any Pledged Mortgage.
(e) Promptly comply in all respects with the terms and conditions
of all Purchase Commitments, and all extensions, renewals and
modifications or substitutions thereof or thereto. The Company will
cause to be delivered to the Investor the Pledged Mortgages to be sold
under each Purchase Commitment not later than the expiration thereof.
(f) Maintain, at its principal office or in a regional office
approved by the Lender, or in the office of a computer service bureau
engaged by the Company and approved by the Lender, and, upon request,
shall make available to the Lender the originals, or copies in any
case where the originals have been delivered to the Lender or to an
Investor, of its Mortgage Notes and Mortgages included in Pledged
Mortgages, Purchase Commitments, and all related Mortgage Loan
documents and instruments, and all files, surveys, certificates,
correspondence, appraisals, computer programs, tapes, discs, cards,
accounting records and other information and data relating to the
Collateral.
6.13 Cure of Defects in Loan Documents. Promptly cure and cause to be
promptly cured any defects in the creation, issuance, execution and delivery of
this Agreement and the other Loan Documents; and upon request of the Lender and
at the Company's expense, the Company will promptly execute and deliver, and
cause to be executed and delivered, to the Lender or its designee, all such
additional documents, agreements and/or instruments in compliance with or in
accomplishment of the covenants and agreements of this Agreement and the other
Loan Documents, and/or to create, perfect, preserve, extend and/or maintain any
and all Liens created pursuant hereto or pursuant to any other Loan Document as
valid and perfected Liens (of a priority as set forth in this Agreement) in
favor of the Lender to secure the Obligations, all as reasonably requested from
time to time by the Lender.
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7. NEGATIVE COVENANTS.
The Company hereby covenants and agrees that, so long as the Commitment is
outstanding or there remain any Obligations of the Company to be paid or
performed under this Agreement or any other Loan Document, the Company shall
not, either directly or indirectly, without the prior written consent of the
Lender which shall not unreasonably be withheld:
7.1 Contingent Liabilities. Assume, incur, create, guarantee, endorse, or
otherwise become or be liable for the obligation of any Person other than the
Company except by endorsement of negotiable instruments for deposit or
collection in the ordinary course of business and excluding the sale of Mortgage
Loans with recourse in the ordinary course of the company's business.
7.2 Pledge of Mortgage Loans. Except for Mortgage Loans pledged to the
lenders described in Exhibit B (or replacements for such lenders), pledge or
grant a security interest in any existing or future Mortgage Loans acquired by
the Company other than to the Lender except as otherwise expressly permitted in
this Agreement; provided, however, that if no Default or Event of Default has
occurred and is continuing, servicing on individual Mortgage Loans may be sold
concurrently with and incidental to the sale of such Mortgage Loans (with
servicing released) in the ordinary course of the Company's business.
7.3 Merger; Acquisitions. Liquidate, dissolve, consolidate or merge, or
acquire any substantial part of the assets of another, except for transactions
involving not more than Fifty Thousand Dollars ($50,000.000) each.
7.4 Loss of Eligibility. Take any action that would cause the Company to
lose all or any part of its status as an eligible lender, seller/servicer and
issuer as described under Section 5.11 hereof.
7.5 Indebtedness to Tangible Net Worth Ratio. Permit the ratio of
Indebtedness to Tangible Net Worth of the Company (and its Subsidiaries, on a
consolidated basis) to exceed 15:1 computed as of the end of each calendar
month.
7.6 Minimum Adjusted Tangible Net Worth. Permit Adjusted Tangible Net Worth
of the Company (and its Subsidiaries, on a consolidated basis) to be less than
Two Million Five Hundred Thousand and No/100 Dollars ($2,500,000.00), computed
as of the end of each calendar month.
7.7 Transactions with Affiliates. Directly or indirectly (a) make any loan,
advance, extension of credit or capital contribution to any of its Affiliates,
(b) transfer, sell, pledge, assign or otherwise dispose of any of its assets to
or on behalf of such Affiliates, (c) merge or consolidate with or purchase or
acquire assets from such Affiliates, or (d) transfer, pledge, or assign or
otherwise pay management fees in excess of Ten Thousand Dollars ($10,000.00) per
annum to or on behalf of such Affiliates (other than Sun Mortgage Advisors, Inc.
under that certain Management Agreement by and between Sun Mortgage Advisors and
NLC Services dated November 11, 1999) and provided that prior to an after giving
effect to any such payment
34
to Sun Mortgage Advisors, no Event of Default exists, except for transactions
described in clauses (a) through (c) of this Section 7.7 involving not more than
Twenty-Five Thousand Dollars ($25,000.00) each.
7.8 Limits on Distributions. Pay, make or declare or incur any liability to
pay, make or declare any dividend (excluding stock dividends) or other
distribution, direct or indirect, on or on account of any partnership interests
or any redemption or other acquisition, direct or indirect, of any of its
partnership interests or of any warrants, rights or other options to purchase
any partnership interests nor purchase, acquire, redeem or retire any
partnership interest or other ownership interest in itself whether now or
hereafter outstanding except that so long as no Default, Event of Default or
violation of Sections 7.5, and 7.6 hereof exists at such time, or would exist
immediately thereafter, the Company may declare and pay cash dividends to its
partners; provided, however, that (a) such cash dividends must be declared and
paid within 20 days after delivery to Lender of the financial statements
described in Section 6.2(a) hereof.
7.9 RICO. Violate any laws, statutes or regulations, whether federal or
state, for which forfeiture of its properties is a potential penalty, including,
without limitations, RICO.
7.10 No Loans or Investments Except Approved Investments. Without the prior
written consent of Lender, make or permit to remain outstanding any loans or
advances to, or investments in, any Person, except that the foregoing
restriction shall not apply to:
(a) investments in marketable obligations maturing no later than
one hundred eighty (180) days from the date of acquisition thereof by
the Company and issued and fully guaranteed, directly, by the full
faith and credit of the government of the United States of America or
any agency thereof; and
(b) investments in certificates of deposit maturing no later than
one hundred eighty (180) days from the date of issuance thereof and
issued by commercial banks in the United States and such banks rated
by Xxxxx'x Investor Service, Inc. and receiving a rating of Prime-2 or
higher on Moody's short term debt rating or rated by Standard & Poor's
Corporation and receiving a rating of AA-/A1+ or higher on S&P's short
term debt rating, or issued by Lender, it being acknowledged and
agreed that the foregoing requirements shall pertain to certificates
of deposit issued and/or received on a date on or after the date of
this Agreement);
(c) investments not to exceed Two Hundred Thousand Dollars
($200,000.00) in the aggregate; and
(d) that certain certificate of deposit in the amount of note
more than Three Hundred Thousand Dollars ($300,000) which is pledged
as security for the Company's lease of its headquarters.
35
7.11 Charter Documents and Business Termination.
(a) Issue, sell or commit to issue or sell any shares of its
partnership interests of any class, or other equity or investment
security,
(b) Amend or otherwise modify its Articles of Formation or
otherwise change its partnership structure in any manner which will
have a materially adverse effect on the Company's condition, financial
or otherwise, or which will have a material adverse effect upon the
Company's ability to perform, promptly and fully, its obligations
hereunder or under any of the other Loan Documents, or
(c) Take any action with a view toward its dissolution,
liquidation or termination, or, in fact, dissolve, liquidate or
terminate its existence.
7.12 Changes in Accounting Methods. Make any change in its accounting
method as in effect on the date of this Agreement or change its fiscal year
ending date from December 31, unless such changes (a) are required for
conformity with generally accepted accounting principles and, in such event, the
Company will give prior written notice of each such change to the Lender or (b)
or if not so required, are in conformity with generally accepted accounting
principles and have the prior written approval of the Lender which approval
shall not be unreasonably withheld.
7.13 No Sales, Leases or Dispositions of Property. Except in the ordinary
course of its business, the Company will not sell, lease, transfer or otherwise
dispose of all or any material portion or portions or integral part of its
properties or assets, whether now owned or hereafter acquired (whether in a
single transaction or in a series of transactions), or enter into any
arrangement, directly or indirectly, with any person, whereby it shall sell or
transfer any of its properties or assets, whether now owned or hereafter
acquired, and thereafter rent or lease as lessee such property or any part
thereof which it intends to use for substantially the same purpose or purposes
as the property sold or transferred.
7.14 Changes in Business or Assets. Make any substantial change (a) in the
nature of its business as now conducted, or (b) in the use of its property as
now used and proposed to be used.
7.15 Changes in Office or Inventory Location. Change the address and/or
location of its chief executive office or principal place of business or the
place where it keeps its books and records or its inventory to a location
outside the State of Florida, unless, prior to any such change, the Company
shall execute and cause to be executed such additional agreements and/or lien
instruments as the Lender may reasonably request to conform with the provisions
hereof and the transactions and perfected Liens in the Collateral contemplated
under this Agreement and the other Loan Documents.
7.16 Special Negative Covenants Concerning Collateral.
36
(a) The Company shall not amend or modify, or waive any of the
terms and conditions of, or settle or compromise any claim in respect
of, any Pledged Mortgages.
(b) The Company shall not sell, assign, transfer or otherwise
dispose of, or grant any option with respect to, or pledge or
otherwise encumber (except pursuant to this Agreement or as permitted
herein) any of the Collateral or any interest therein.
(c) The Company shall not make any compromise, adjustment or
settlement in respect of any of the Collateral or accept other than
cash in payment or liquidation of the Collateral.
7.17 No Indebtedness. Except for the Indebtedness described in Exhibit B
hereto, without the prior written consent of Lender, the Company will not incur,
create, assume or guarantee or in any manner become or be liable or permit to be
outstanding any Indebtedness (including obligations for the payment of rentals
other than provided for herein) nor guarantee any contract or other obligation,
and will not in any way become or be responsible for obligations of any Person,
whether by agreement to purchase the Indebtedness of any other Person or
agreement for the furnishing of funds to any other Person through the purchase
of goods, supplies or services (or by way of stock purchase, capital
contribution, advance or loan) for the purpose of paying or discharging the
Indebtedness of any other Person or otherwise, except that the foregoing
restrictions shall not apply to:
(a) The Obligations.
(b) Liabilities for taxes, assessments, governmental charges or
levies which are not yet due and payable or which are being contested
in good faith by appropriate proceedings diligently conducted if
reserves adequate under generally accepted accounting principles have
been established therefor.
(c) Endorsements of negotiable instruments for collection in the
ordinary course of business.
(d) Indebtedness incurred in the ordinary course of business in
connection with normal trade or business obligations which are payable
within 90 days of the occurrence thereof, provided, however, that no
Indebtedness shall be incurred by the Company to any Affiliate other
than in the ordinary course of business and upon substantially the
same or better terms as it could obtain in an arm's length transaction
with a Person who is not an Affiliate.
(e) Indebtedness of less than Fifty Thousand and No/100 Dollars
($50,000.00), in the aggregate, incurred in the ordinary course of
business.
37
(f) Indebtedness incurred in the ordinary course of business for
the purpose of leasing office space or equipment to be used in the
conduct of the business of the Company.
7.18 Ownership of the Company. Permit any change in the legal or beneficial
ownership of any partnership interests, instruments convertible to same, or
other equity instruments, of either Company.
7.19 Material Adverse Change. Cause or permit to occur any event which
will, in the Lender's reasonable discretion, have a material adverse effect on
the business or prospects of the Company, taken as a whole.
8. DEFAULTS; REMEDIES.
8.1 Events of Default. The occurrence of any of the following conditions or
events shall be an event of default ("Event of Default"):
(a) Failure to pay the principal of any Advance when due, whether
at stated maturity, by acceleration, or otherwise; or failure to pay
any installment of interest on any Advance or any other amount due
under this Agreement within ten (10) days after the due date; or
failure to pay, beyond any applicable grace period, the principal or
interest on any other indebtedness due the Lender; or
(b) Failure of the Company or any of its Subsidiaries to pay, or
any default in the payment of any principal or interest on, any other
Indebtedness or in the payment of any contingent obligation beyond any
period of grace provided; or breach or default with respect to any
other material term of any other Indebtedness of any loan agreement,
mortgage, indenture or other agreement relating thereto, if the effect
of such failure, default or breach is to cause the holder or holders
thereof (or a trustee on behalf of such holder or holders) to cause,
Indebtedness of the Company or its Subsidiaries in the aggregate
amount of Two Hundred Fifty Thousand and No/100 Dollars ($250,000.00)
or more to become due prior to its stated maturity (upon the giving or
receiving of notice, lapse of time, both, or otherwise) or failure of
the Company to comply with Section 6.11 hereof; or
(c) Any of the Company's representations or warranties made or
deemed made herein or in any other Loan Document, or in any statement
or certificate at any time given by the Company in writing pursuant
hereto or thereto shall be inaccurate or incomplete in any materially
adverse respect on the date as of which made or deemed made; or
(d) The Company shall default in the performance of or compliance
with any term or covenant contained in this Agreement and such default
shall not have been remedied or waived within thirty (30) days after
receipt of notice from the Lender of such default other than those
referred to above in Subsections 8.1(a), 8.1(b) or 8.1(c); or
38
(e) (1) A court having jurisdiction shall enter a decree or order
for relief in respect of the Company or any of Company's Subsidiaries
in an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect in respect of the Company
or any of Company's Subsidiaries, which decree or order is not stayed;
or a filing of an involuntary case under any applicable bankruptcy,
insolvency or other similar law in respect of the Company or any of
Company's Subsidiaries has occurred; or (2) any other similar relief
shall be granted under any applicable federal or state law; or a
decree or order of a court having jurisdiction for the appointment of
a receiver, liquidator, sequestrator, trustee, custodian or other
officer having similar powers over the Company or any of Company's
Subsidiaries, or over all or a substantial part of their respective
property, shall have been entered; or the involuntary appointment of
an interim receiver, trustee or other custodian of the Company or any
of Company's Subsidiaries, for all or a substantial part of their
respective property; or the issuance of a warrant of attachment,
execution or similar process against any substantial part of the
property of the Company or any of Company's Subsidiaries, and the
continuance of any such events in Subsections (1) and (2) above for
sixty (60) days unless dismissed or discharged; or
(f) The Company or any of Company's Subsidiaries shall have an
order for relief entered with respect to it or commence a voluntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or shall consent to the entry of an order
for relief in an involuntary case, or to the conversion to an
involuntary case, under any such law, or shall consent to the
appointment of or taking possession by a receiver, trustee or other
custodian for all or a substantial part of its property; the making by
the Company or any of Company's Subsidiaries of any assignment for the
benefit of creditors; or the failure of the Company or any of
Company's Subsidiaries, or the admission by any of them of its
inability, to pay its debts as such debts become due; or
(g) Any money judgment, writ or warrant of attachment, or similar
process involving in any case an amount in excess of Fifty Thousand
Dollars ($50,000.00) shall be entered or filed against the Company or
any of its Subsidiaries or any of their respective assets and shall
remain undischarged, unvacated, unbonded or unstayed for a period of
thirty (30) days or in any event no later than five (5) days prior to
the date of any proposed sale thereunder; or
(h) Any order, judgment or decree shall be entered against the
Company decreeing the dissolution or split up of the Company and such
order shall remain undischarged or unstayed for a period in excess of
twenty (20) days; or
(i) Any Plan maintained by the Company or any of Company's
Subsidiaries shall be terminated within the meaning of Title IV of
ERISA or a trustee shall be appointed by an appropriate United States
district court to administer any Plan, or the Pension Benefit Guaranty
Corporation (or any successor thereto) shall institute proceedings to
terminate any Plan or to appoint a
39
trustee to administer any Plan if as of the date thereof the Company's or
any Subsidiary's liability (after giving effect to the tax consequences
thereof) to the Pension Benefit Guaranty Corporation (or any successor
thereto) for unfunded guaranteed vested benefits under the Plan exceeds the
then current value of assets accumulated in such Plan by more than Fifty
Thousand Dollars ($50,000.00) (or in the case of a termination involving
the Company or any of Company's Subsidiaries as a "substantial employer"
(as defined in Section 4001(a)(2) of ERISA) the withdrawing employer's
proportionate share of such excess shall exceed such amount); or
(j) The Company or any of Company's Subsidiaries as employer under a
Multiemployer Plan shall have made a complete or partial withdrawal from
such Multiemployer Plan and the plan sponsor of such Multiemployer Plan
shall have notified such withdrawing employer that such employer has
incurred a withdrawal liability in an annual amount exceeding Fifty
Thousand Dollars ($50,000.00); or
(k) The Company shall purport to disavow its obligations hereunder or
shall contest the validity or enforceability hereof, or the Lender's
security interest on any portion of the Collateral shall become
unenforceable or otherwise impaired; provided that, subject to the Lender's
approval, no Event of Default shall occur as a result of such impairment if
all Advances made against any such Collateral shall be paid in full within
ten (10) days of the date of such impairment; or
(1) The Company dissolves or terminates its existence, or discontinues
its usual business; or
(m) Any court shall find or rule, or the Company shall assert or
claim, (i) that the Lender does not have a valid, perfected, enforceable
Lien and security interest in the Collateral of the priority as represented
in this Agreement or in any other Loan Document, or (ii) that this
Agreement or any of the Loan Documents does not or will not constitute the
legal, valid, binding and enforceable obligations of the party or parties
(as applicable) thereto, or (iii) that any Person has a conflicting or
adverse Lien, claim or right in, or with respect to, the Collateral and the
Company is unable within 10 days to have such finding or ruling reversed or
to have such adverse Lien, claim or right removed; or
(n) The Company shall have concealed, removed, or permitted to be
concealed or removed, any part of its property, with intent to hinder,
delay or defraud its creditors or any of them, or made or suffered a
transfer of any of its property which may be fraudulent under any
bankruptcy, fraudulent conveyance or similar law; or shall have made any
transfer of its property to or for the benefit of a creditor at a time when
other creditors similarly situated have not been paid; or shall have
suffered or permitted, while insolvent, any creditor to obtain a Lien upon
any of its property through legal proceedings or distraint or other process
which is not vacated within 60 days from the date thereof; or
40
(o) There shall be a material adverse change in the financial
condition, business or operations of the Company; or
(p) A Change of Control occurs.
8.2 Remedies.
(a) Upon the occurrence, and during the continuance, of any Event of
Default described in Sections 8.1(e) or 8.1(f), the Commitment shall be
terminated and all Obligations of the Company shall automatically become
due and payable, without presentment for payment, demand, notice of
non-payment, protest, notice of protest, notice of intent to accelerate,
notice of acceleration, maturity, or any other notices or requirements of
any kind of Lender to the Company or any other Person liable thereon or
with respect thereto, all of which are hereby expressly waived by the
Company.
(b) Upon the occurrence, and during the continuance, of any Event of
Default, other than those described in Sections 8.l(e) or 8.1(f), the
Lender may, by written notice to the Company, terminate the Commitment
and/or declare all Obligations of the Company to be immediately due and
payable, whereupon the same shall forthwith become due and payable,
together with all accrued and unpaid interest thereon, and the obligation
of the Lender to make any Advances shall thereupon terminate.
(c) Upon the occurrence, and during the continuance, of any Event of
Default, the Lender may also do any of the following:
(1) Foreclose upon or otherwise enforce its security interest in
and Lien on the Collateral to secure all payments and performance of
Obligations of the Company in any manner permitted by law or provided
for hereunder.
(2) Notify all obligors in respect of the Collateral that the
Collateral has been assigned to the Lender and that all payments
thereon are to be made directly to the Lender or such other party as
may be designated by the Lender; settle, compromise, or release, in
whole or in part, any amounts owing on the Collateral, any such
obligor or any Investor or any portion of the Collateral, on terms
acceptable to the Lender; enforce payment and prosecute any action or
proceeding with respect to any and all Collateral; and where any such
Collateral is in default, foreclose on and enforce security interests
in, such Collateral by any available judicial procedure or without
judicial process and sell property acquired as a result of any such
foreclosure.
(3) Act, or contract with a third party to act, as servicer or
subservicer of each item of Collateral requiring servicing and perform
all
41
obligations required in connection with Purchase Commitments, such
third party's fees to be paid by the Company.
(4) Require the Company to assemble the Collateral and/or books
and records relating thereto and make such available to the Lender at
a place to be designated by the Lender.
(5) Enter onto property where any Collateral or books and records
relating thereto are located and take possession thereof with or
without judicial process.
(6) Prior to the disposition of the Collateral, prepare it for
disposition in any manner and to the extent the Lender deems
appropriate.
(7) Exercise all rights and remedies of a secured creditor under
the Uniform Commercial Code of Texas or other applicable law,
including, but not limited to, selling or otherwise disposing of the
Collateral, or any part thereof, at one or more public or private
sales, whether or not such Collateral is present at the place of sale,
for cash or credit or future delivery, on such terms and in such
manner as the Lender may determine, including, without limitation,
sale pursuant to any applicable Purchase Commitment. If notice is
required under such applicable law, the Lender will give the Company
not less than ten (10) days' notice of any such public sale or of the
date after which private sale may be held. The Company agrees that ten
(10) days' notice shall be reasonable notice. The Lender may, without
notice or publication, adjourn any public or private sale or cause the
same to be adjourned from time to time by announcement at the time and
place fixed for the sale, and such sale may be made at any time or
place to which the same may be so adjourned. In case of any sale of
all or any part of the Collateral on credit or for future delivery,
the Collateral so sold may be retained by the Lender until the selling
price is paid by the purchaser thereof, but the Lender shall not incur
any liability in case of the failure of such purchaser to take up and
pay for the Collateral so sold and, in case of any such failure, such
Collateral may again be sold upon like notice. The Lender may,
however, instead of exercising the power of sale herein conferred upon
it, proceed by a suit or suits at law or in equity to collect all
amounts due upon the Collateral or to foreclose the pledge and sell
the Collateral or any portion thereof under a judgment or decree of a
court or courts of competent jurisdiction, or both.
(8) Proceed against the Company on the Note.
(d) The Lender shall incur no liability as a result of the sale or
other disposition of the Collateral, or any part thereof, at any public or
private sale or disposition. The Company hereby waives (to the extent
permitted by law) any claims it may have against the Lender arising by
reason of the fact that the price at
42
which the Collateral may have been sold at such private sale was less
than the price which might have been obtained at a public sale or was
less than the aggregate amount of the outstanding Advances and the
unpaid interest accrued thereon, even if the Lender accepts the first
offer received and does not offer the Collateral to more than one
offeree and none of the actions described herein shall render Lender's
disposition of the Collateral in such a manner as commercially
unreasonable.
(e) The Company specifically waives (to the extent permitted by
law) any equity or right of redemption, all rights of redemption, stay
or appraisal which the Company has or may have under any rule of law
or statute now existing or hereafter adopted, and any right to require
the Lender to (1) proceed against any Person, (2) proceed against or
exhaust any of the Collateral or pursue its rights and remedies as
against the Collateral in any particular order, or (3) pursue any
other remedy in its power. The Lender shall not be required to take
any steps necessary to preserve any rights of the Company against
holders of mortgages prior in lien to the Lien of any Mortgage
included in the Collateral or to preserve rights against prior
parties.
(f) The Lender may, but shall not be obligated to, advance any
sums or do any act or thing necessary to uphold and enforce the Lien
and priority of, or the security intended to be afforded by, any
Mortgage included in the Collateral, including, without limitation,
payment of delinquent taxes or assessments and insurance premiums. All
advances, charges, costs and expenses, including reasonable attorneys'
fees and disbursements, incurred or paid by the Lender in exercising
any right, power or remedy conferred by this Agreement, or in the
enforcement hereof, together with interest thereon, at the Default
Rate, from the time of payment until repaid, shall become a part of
the principal balance outstanding hereunder and under the Note.
(g) No failure on the part of the Lender to exercise, and no
delay in exercising, any right, power or remedy provided hereunder, at
law or in equity shall operate as a waiver thereof; nor shall any
single or partial exercise by the Lender of any right, power or remedy
provided hereunder, at law or in equity preclude any other or further
exercise thereof or the exercise of any other right, power or remedy.
Without intending to limit the foregoing, all defenses based on the
statute of limitations are hereby waived by the Company to the extent
permitted by law. The remedies herein provided are cumulative and are
not exclusive of any remedies provided at law or in equity.
8.3 Application of Proceeds. The proceeds of any sale, disposition or other
enforcement of the Lender's security interest in all or any part of the
Collateral shall be applied by the Lender:
First, to the payment of the costs and expenses of such sale or
enforcement, including reasonable compensation to the Lender's agents and
counsel, and all expenses,
43
liabilities and advances made or incurred by or on behalf of the Lender in
connection therewith;
Second, to the payment of any other amounts due (other than principal
and interest) under the Note or this Agreement;
Third, to the payment of interest accrued and unpaid on the Note;
Fourth, to the payment of the outstanding principal balance of the
Note; and
Finally, to the payment to the Company, or to its successors or
assigns, or as a court of competent jurisdiction may direct, of any surplus
then remaining from such proceeds.
If the proceeds of any such sale, disposition or other enforcement are
insufficient to cover the costs and expenses of such sale, as aforesaid, and the
payment in full of all Obligations of the Company, the Company shall remain
liable for any deficiency.
8.4 Lender Appointed Attorney-in-Fact. The Lender is hereby appointed the
attorney-in-fact of the Company, with full power of substitution, for the
purpose of carrying out the provisions hereof and taking any action and
executing any instruments which the Lender may deem necessary or advisable to
accomplish the purposes hereof, which appointment as attorney-in-fact is
irrevocable and coupled with an interest. Without limiting the generality of the
foregoing, the Lender shall have the right and power to give notices of its
security interest in the Collateral to any Person, either in the name of the
Company or in its own name, to endorse all Pledged Mortgages payable to the
order of the Company, to change or cause to be changed the book-entry
registration or name of subscriber or Investor on any Pledged Security, or to
receive, endorse and collect all checks made payable to the order of the Company
representing any payment on account of the principal of or interest on, or the
proceeds of sale of, any of the Pledged Mortgages and to give full discharge for
the same.
8.5 Right of Set-Off. If there shall be an Event of Default under Section
8.1(a), or any other sums which may become payable hereunder when due, or in
the performance of any of its other Obligations under this Agreement, the
Lender, shall have the right, at any time and from time to time, without notice,
to set-off and to appropriate or apply any and all property or indebtedness of
any kind at any time held or owing by the Lender to or for the credit of the
account of the Company (excluding any monies held by the Company in trust for
third parties) against and on account of the Obligations, irrespective of
whether or not the Lender shall have made any demand hereunder and whether or
not said Obligations shall have matured; provided, however, that the Lender
shall not be allowed to set-off against funds in accounts with respect to which
(i) the Company is a trustee or an escrow agent in respect of bona fide third
parties other than Affiliates, and (ii) such trust or escrow arrangement was so
denominated at the time of the creation of such account.
44
9. NOTICES.
All notices, demands, consents, requests and other communications required
or permitted to be given or made hereunder (collectively, "Notices") shall,
except as otherwise expressly provided hereunder, be in writing and shall be
delivered in person or mailed, first class, return receipt requested, postage
prepaid, or delivered by overnight courier, addressed to the respective parties
hereto at their respective addresses hereinafter set forth or, as to any such
party, at such other address as may be designated by it in a Notice to the
other. All Notices shall be conclusively deemed to have been properly given or
made when duly delivered, in person or by overnight courier, or if mailed on the
third Business Day after being deposited in the mails, addressed as follows:
If to the Company: NLC Financial Services, LLC
Banc NLC Mortgage Lending, LLC
000 Xxxx Xxxxxxxxxxxx Xxxxxxxxx
Xxxxxxxxx Xxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Fax No.: (000) 000-0000
If to the Lender: Bank United
Attn: Xxxxxx Xxxxxx, Vice President - Director
0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxxxx, XX 00000
Fax No.: (000) 000-0000
with a copy to: Bank United
Attn: Xxxxx Xxxxxxxx
Managing Director, Mortgage Banker Financing
0000 Xxxxxxxxx Xxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
and: Bank United
Attn: Xxxxx X. Xxxxx
Associate General Counsel
0000 Xxxxxxxxx Xxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Fax No.: (000) 000-0000
10. REIMBURSEMENT OF EXPENSES; INDEMNITY.
The Company shall: (a) pay all reasonable out-of-pocket costs and expenses
of the Lender, including, without limitation, reasonable attorneys' and
auditor's fees, in connection with the preparation, negotiation, documentation,
enforcement and administration of this
45
Agreement, the Note, and other Loan Documents and the making and repayment of
the Advances and the payment of interest thereon; (b) pay, and hold the Lender
and any holder of the Note harmless from and against, any and all present and
future stamp, documentary and other similar taxes with respect to the foregoing
matters and save the Lender and the holder or holders of the Note harmless from
and against any and all liabilities with respect to or resulting from any delay
or omission to pay such taxes; (c) INDEMNIFY, PAY AND HOLD HARMLESS THE LENDER
AND ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES OR AGENTS AND ANY SUBSEQUENT
HOLDER OF THE NOTE FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS,
LOSSES, DAMAGES, PENALTIES, JUDGMENTS, SUITS, COSTS, EXPENSES AND DISBURSEMENTS
OF ANY KIND WHATSOEVER (THE "INDEMNIFIED LIABILITIES") (INCLUDING, WITHOUT
LIMITATION, INDEMNIFIED LIABILITIES RESULTING, IN WHOLE OR IN PART, FROM
LENDER'S OWN NEGLIGENCE OR STRICT LIABILITY) WHICH MAY BE IMPOSED UPON, INCURRED
BY OR ASSERTED AGAINST THE LENDER OR SUCH HOLDER IN ANY WAY RELATING TO OR
ARISING OUT OF THIS AGREEMENT, THE NOTE, OR ANY OTHER LOAN DOCUMENT OR ANY OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY TO THE EXTENT THAT ANY SUCH
INDEMNIFIED LIABILITIES RESULT (DIRECTLY OR INDIRECTLY) FROM ANY CLAIMS MADE, OR
ANY ACTIONS, SUITS OR PROCEEDINGS COMMENCED OR THREATENED, BY OR ON BEHALF OF
ANY CREDITOR (EXCLUDING THE LENDER AND THE HOLDER OR HOLDERS OF THE NOTE),
SECURITY HOLDER, SHAREHOLDER, CUSTOMER (INCLUDING, WITHOUT LIMITATION, ANY
PERSON HAVING ANY DEALINGS OF ANY KIND WITH THE COMPANY), TRUSTEE, DIRECTOR,
OFFICER, EMPLOYEE AND/OR AGENT OF THE COMPANY ACTING IN SUCH CAPACITY, THE
COMPANY OR ANY GOVERNMENTAL REGULATORY BODY OR AUTHORITY. THE FOREGOING
INDEMNITY SHALL NOT APPLY TO THE EXTENT THE INDEMNIFIED LIABILITIES RESULT FROM
THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE LENDER OR LENDER'S OWN
VIOLATIONS OF REGULATIONS APPLICABLE TO IT. THE AGREEMENT OF THE COMPANY
CONTAINED IN THIS SUBSECTION (C) SHALL SURVIVE THE EXPIRATION OR TERMINATION OF
THIS AGREEMENT AND THE PAYMENT IN FULL OF THE NOTE. ATTORNEYS' FEES AND
DISBURSEMENTS INCURRED IN ENFORCING, OR ON APPEAL FROM, A JUDGMENT PURSUANT
HERETO SHALL BE RECOVERABLE SEPARATELY FROM AND IN ADDITION TO ANY OTHER AMOUNT
INCLUDED IN SUCH JUDGMENT, AND THIS CLAUSE IS INTENDED TO BE SEVERABLE FROM THE
OTHER PROVISIONS OF THIS AGREEMENT AND TO SURVIVE AND NOT BE MERGED INTO SUCH
JUDGMENT.
11. FINANCIAL INFORMATION.
All financial statements and reports furnished to the Lender hereunder
shall be prepared in accordance with GAAP, applied on a basis consistent with
that applied in preparing the financial statements as at, and for the period
ended, the Statement Date (except to the extent otherwise required to conform to
good accounting practice).
46
12. MISCELLANEOUS.
12.1 Terms Binding Upon Successors; Survival of Representations. The terms
and provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns. All
representations, warranties, covenants and agreements herein contained on the
part of the Company shall survive the making of any Advance and the execution of
the Note, and shall be effective so long as the Commitment is outstanding
hereunder or there remain any Obligations of the Company hereunder or under the
Note to be paid or performed.
12.2 Assignment. This Agreement may not be assigned by the Company. The
Lender may assign, at any time, in whole or in part, its rights and delegate its
obligations under this Agreement and the other Loan Documents, along with the
Lender's security interest in any or all of the Collateral, and any assignee
thereof may enforce this Agreement and the other Loan Documents, and such
security interest.
12.3 Amendments. Except as otherwise provided in this Agreement, this
Agreement may not be amended, modified or supplemented unless such amendment,
modification or supplement is set forth in a writing signed by the parties
hereto.
12.4 Governing Law. This Agreement and the other Loan Documents shall be
governed by the laws of the State of Texas, without reference to its principles
of conflicts of laws.
12.5 Participations. The Lender may at any time sell, assign or grant
participations in, or otherwise transfer to any other Person (a "Participant"),
all or part of the Obligations of the Company under this Agreement. The Company
authorizes the Lender to disclose to any prospective Participant and any
Participant any and all information in the Lender's possession concerning the
Company, this Agreement and the Collateral.
12.6 Relationship of the Parties. This Agreement provides for the making of
Advances by the Lender, in its capacity as a lender, to the Company, in its
capacity as a borrower, and for the payment of interest, repayment of principal
by the Company to the Lender, and for the payment of certain fees by the Company
to the Lender. The relationship between the Lender and the Company is limited to
that of creditor/secured party, on the one hand, and debtor, on the other hand.
The provisions herein for compliance with financial covenants and delivery of
financial statements are intended solely for the benefit of the Lender to
protect its interests as lender in assuring payments of interest and repayment
of principal and payment of certain fees, and nothing contained in this
Agreement shall be construed as permitting or obligating the Lender to act as a
financial or business advisor or consultant to the Company, as permitting or
obligating the Lender to control the Company or to conduct the Company's
operations, as creating any fiduciary obligation on the part of the Lender to
the Company, or as creating any joint venture, agency, or other relationship
between the parties hereto other than as explicitly and specifically stated in
this Agreement. The Company acknowledges that it has had the opportunity to
obtain the advice of experienced counsel of its own choosing in connection with
47
the negotiation and execution of this Agreement and to obtain the advice of such
counsel with respect to all matters contained herein, including, without
limitation, the provision for waiver of trial by jury. The Company further
acknowledges that it is experienced with respect to financial and credit matters
and has made its own independent decisions to apply to the Lender for credit and
to execute and deliver this Agreement.
12.7 Severability. If any provision of this Agreement shall be declared to
be illegal or unenforceable in any respect, such illegal or unenforceable
provision shall be and become absolutely null and void and of no force and
effect as though such provision were not in fact set forth herein, but all other
covenants, terms, conditions and provisions hereof shall nevertheless continue
to be valid and enforceable.
12.8 Usury. It is the intent of Lender and the Company in the execution and
performance of this Agreement and the Note or any Loan Document to remain in
strict compliance with Applicable Law from time to time in effect. In
furtherance thereof, Lender and the Company stipulate and agree that none of the
terms and provisions contained in the Note, this Agreement or any Loan Document
shall ever be construed to create a contract to pay for the use, forbearance or
detention of money with interest at a rate or in an amount in excess of the
Maximum Rate or amount of interest permitted to be charged under Applicable Law.
For purposes of this Agreement, the Note and any other Loan Document, "interest"
shall include the aggregate of all charges which constitute interest under
Applicable Law that are contracted for, taken, charged, reserved, or received
under this Agreement, the Note or any other Loan Document. The Company shall
never be required to pay unearned interest or interest at a rate or in an amount
in excess of the Maximum Rate or amount of interest that may be lawfully charged
under Applicable Law, and the provisions of this paragraph shall control over
all other provisions of this Agreement and the Note or any Loan Document, which
may be in actual or apparent conflict herewith. If the Note is prepaid, or if
the maturity of the Note is accelerated for any reason, or if under any other
contingency the effective rate or amount of interest which would otherwise be
payable under the Note would exceed the Maximum Rate or amount of interest
Lender or any other holder of the Note is allowed by Applicable Law to charge,
contract for, take, reserve or receive, or in the event Lender or any holder of
the Note shall charge, contract for, take, reserve or receive monies that are
deemed to constitute interest which would, in the absence of this provision,
increase the effective rate or amount of interest payable under the Note to a
rate or amount in excess of that permitted to be charged, contracted for, taken,
reserved or received under Applicable Law then in effect, then the principal
amount of the Note or the amount of interest which would otherwise be payable
under the Note or both shall be reduced to the amount allowed under Applicable
Law as now or hereinafter construed by the courts having jurisdiction, and all
such moneys so charged, contracted for, taken, reserved or received that are
deemed to constitute interest in excess of the Maximum Rate or amount of
interest permitted by Applicable Law shall immediately be returned to or
credited to the account of the Company upon such determination. Lender and the
Company further stipulate and agree that, without limitation of the foregoing,
all calculations of the rate or amount of interest contracted for, charged,
taken, reserved or received under the Note which are made for the purpose of
determining whether such rate or amount exceeds the Maximum Rate, shall be made
to the extent not prohibited by Applicable Law, by amortizing, prorating,
allocating and spreading during the period of the full
48
stated term of the Note, all interest at any time contracted for, charged,
taken, reserved or received from the Company or otherwise by Lender or any other
holder of the Note.
12.9 Consent to Jurisdiction. Subject to the provisions of Section 12.10 of
this Agreement, the Company hereby agrees that any action or proceeding under
this Agreement, the Note or any document delivered pursuant hereto may be
commenced against it in any court of competent jurisdiction within the State of
Texas, by service of process upon the Company by first class registered or
certified mail, return receipt requested, addressed to the Company at its
address last known to the Lender. The Company agrees that any such suit, action
or proceeding arising out of or relating to this Agreement or any other such
document may be instituted in Xxxxxx County, State District Court or in the
United States District Court for the District of Texas at the option of the
Lender; and the Company hereby waives any objection to the venue, or any claim
as to inconvenient forum, of any such suit, action or proceeding. Nothing herein
shall affect the right of the Lender to accomplish service of process in any
other manner permitted by law or to commence legal proceedings or otherwise
proceed against the Company in any other jurisdiction or court.
12.10 Arbitration. To the maximum extent not prohibited by law, any
controversy, dispute or claim arising out of, in connection with, or relating to
the Commitment or the Loan Documents or any transaction provided for therein,
including but not limited to any claim based on or arising from an alleged tort
or an alleged breach of any agreement contained in any of the Loan Documents,
shall, at the request of any party to the Loan Documents (either before or after
the commencement of judicial proceedings), be settled by arbitration pursuant to
Title 9 of the United States Code, which the parties hereto acknowledge and
agree applies to the transaction involved herein, and in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (the
"AAA"). If Title 9 of the United States Code is inapplicable to any such claim,
dispute or controversy for any reason, such arbitration shall be conducted
pursuant to the Texas General Arbitration Act and in accordance with the
Commercial Arbitration Rules of the AAA. In any such arbitration proceeding: (i)
all statutes of limitations which would otherwise be applicable shall apply; and
(ii) the proceeding shall be conducted in Houston, Texas, by a single
arbitrator, if the amount in controversy is One Million Dollars ($1,000,000.00)
or less, or by a panel of three arbitrators if the amount in controversy is over
One Million Dollars ($1,000,000.00). All arbitrators shall be selected by the
process of appointment from a panel pursuant to Section 13 of the AAA Commercial
Arbitration Rules and each arbitrator shall be either an active attorney, a
mortgage banker or retired judge with an AAA acknowledged expertise in the
subject matter of the controversy, dispute or claim. Any award rendered in any
such arbitration proceeding shall be final and binding, and judgment upon any
such award may be entered in any court having jurisdiction.
If any party to any Loan Document files a proceeding in any court to
resolve any such controversy, dispute or claim, such action shall not constitute
a waiver of the right of such party or a bar to the right of any other party to
seek arbitration under the provisions of this Section of that or any other
claim, dispute or controversy, and the court shall, upon motion of any party to
the proceeding, direct that such controversy, dispute or claim be arbitrated in
accordance with this Section.
49
Notwithstanding any of the foregoing, the parties hereto agree that no
arbitrator or panel of arbitrators shall possess or have the power to (i) assess
punitive damages, (ii) dissolve, rescind or reform (except that the arbitrator
may construe ambiguous terms) any Loan Document, (iii) enter judgment on the
debt, (iv) exercise equitable powers or issue or enter any equitable remedies
with respect to matters submitted to arbitration, or (v) allow discovery of
attorney/client privileged information. The Commercial Arbitration Rules of the
AAA are hereby modified to this extent for the purpose of arbitration of any
dispute, controversy or claim arising out of, in connection with, or relating to
the Loan or any Loan Document. The parties hereby further agree to waive, each
to the other, any claims for punitive damages and agree neither an arbitrator
nor any court shall have the power to assess such damages.
No provision of, or the exercise of any rights under, this Section shall
limit or impair the right of any party to any Loan Document before, during or
after any arbitration proceeding to: (i) exercise self-help remedies such as
setoff or repossession; (ii) foreclose (judicially or otherwise) any Lien on or
security interest in any real or personal Collateral; or (iii) obtain emergency
relief from a court of competent jurisdiction to prevent the dissipation,
damage, destruction, transfer, hypothecation, pledging or concealment of assets
or of Collateral securing any Indebtedness, obligation or guaranty referenced in
any Loan Document. Such emergency relief may be in the nature of, but is not
limited to: pre-judgment attachments, garnishments, sequestrations, appointments
of receivers, or other emergency injunctive relief to preserve the status quo.
12.11 ADDITIONAL INDEMNITY. IN ADDITION TO THE INDEMNITY PROVIDED IN
SECTION 10, THE COMPANY SHALL INDEMNIFY AND HOLD THE LENDER, ITS SUCCESSORS,
ASSIGNS, AGENTS, AND EMPLOYEES, HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS,
ACTIONS, SUITS, PROCEEDINGS, COSTS, EXPENSES, DAMAGES, FINES, PENALTIES, AND
LIABILITIES, INCLUDING, WITHOUT LIMITATION, ATTORNEYS' FEES AND COSTS, ARISING
OUT OF, CONNECTED WITH, OR RESULTING FROM (A) THE OPERATION OF THE COMPANY'S
BUSINESSES, (B) THE LENDER'S PRESERVATION OR ATTEMPTED PRESERVATION OF
COLLATERAL, AND (C) ANY FAILURE OF THE SECURITY INTERESTS AND LIENS IN THE
COLLATERAL GRANTED TO THE LENDER PURSUANT TO THIS AGREEMENT TO BE OR TO REMAIN
PERFECTED OR TO HAVE THE PRIORITY AS CONTEMPLATED THEREIN REGARDLESS OF WHETHER
THE CLAIM IS CAUSED BY OR ARISES OUT OF, IN WHOLE OR IN PART, THE NEGLIGENCE OF
THE LENDER OR MAY BE BASED ON THE STRICT LIABILITY OF THE LENDER. THIS INDEMNITY
SHALL NOT APPLY TO THE EXTENT THE SUBJECT OF THE INDEMNIFICATION IS CAUSED BY OR
ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE LENDER OR
LENDER'S VIOLATION OF REGULATIONS APPLICABLE TO IT. AT THE LENDER'S REQUEST, THE
COMPANY SHALL, AT ITS OWN COST AND EXPENSE, DEFEND OR CAUSE TO BE DEFENDED ANY
AND ALL SUCH ACTIONS OR SUITS THAT MAY BE BROUGHT AGAINST THE LENDER AND, IN ANY
EVENT, SHALL SATISFY, PAY, AND DISCHARGE ANY AND ALL JUDGMENTS, AWARDS,
PENALTIES, COSTS, AND FINES THAT MAY BE RECOVERED
50
AGAINST THE LENDER IN ANY SUCH ACTION, PLUS ALL ATTORNEYS' FEES AND COSTS
RELATED THERETO TO THE EXTENT PERMITTED BY APPLICABLE LAW; PROVIDED, HOWEVER,
THAT THE LENDER SHALL GIVE THE COMPANY (TO THE EXTENT THE LENDER SEEKS
INDEMNIFICATION THEREFOR FROM THE COMPANY UNDER THIS SECTION 12.11) WRITTEN
NOTICE OF ANY SUCH CLAIM, DEMAND, OR SUIT AFTER THE LENDER HAS RECEIVED WRITTEN
NOTICE THEREOF, AND THE LENDER SHALL NOT SETTLE ANY SUCH CLAIM, DEMAND, OR SUIT,
IF THE LENDER SEEKS INDEMNIFICATION THEREFOR FROM THE COMPANY, WITHOUT FIRST
GIVING NOTICE TO THE COMPANY OF THE LENDER'S DESIRE TO SETTLE AND OBTAINING THE
CONSENT OF THE COMPANY TO THE SAME, WHICH CONSENT THE COMPANY HEREBY AGREES NOT
TO UNREASONABLY WITHHOLD. ALL OBLIGATIONS OF THE COMPANY UNDER THIS SECTION
12.11 SHALL SURVIVE THE PAYMENT OF THE NOTE AND THE OBLIGATIONS.
12.12 No Waivers Except in Writing. No failure or delay on the part of the
Lender in exercising any power or right hereunder or under any other Loan
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. No notice to or demand on
the Company or any other Person in any case shall entitle the Company or such
other Person to any other or further notice or demand in similar or other
circumstances.
12.13 Waiver of Jury Trial. Company hereby expressly waives any right to a
trial by jury in any action or legal proceeding arising out of or relating to
this Agreement or any other Loan Document for the transactions contemplated
hereby or thereby.
12.14 Multiple Counterparts. This Agreement may be executed in any number
of counterparts, all of which, taken together, shall constitute one and the same
instrument.
12.15 No Third Party Beneficiaries. This Agreement is for the sole and
exclusive benefit of the Company and Lender. This Agreement does not create, and
is not intended to create, any rights in favor of or enforceable by any other
Person. This Agreement may be amended or modified by the agreement of the
Company and Lender, without any requirement or necessity for notice to, or the
consent of or approval of any other Person.
12 16 RELEASE OF LENDER LIABILITY. TO THE MAXIMUM EXTENT NOT PROHIBITED BY
LAW FROM TIME TO TIME IN EFFECT, THE COMPANY HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY (AND AFTER IT HAS CONSULTED WITH ITS OWN ATTORNEY) IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT NO CLAIM MAY BE MADE BY THE COMPANY AGAINST THE
LENDER OR ANY OF ITS DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS, ACCOUNTANTS,
AGENTS OR INSURERS, OR ANY OF ITS OR THEIR SUCCESSORS AND ASSIGNS, FOR ANY
SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT OF ANY BREACH OR
51
WRONGFUL CONDUCT (WHETHER THE CLAIM IS BASED ON CONTRACT OR TORT OR DUTY IMPOSED
BY LAW) ARISING OUT OF, OR RELATED TO, THE TRANSACTIONS CONTEMPLATED BY ANY OF
THIS AGREEMENT, THE NOTE, OR ANY OTHER LOAN DOCUMENTS, OR ANY ACT, OMISSION, OR
EVENT OCCURRING IN CONNECTION HEREWITH OR THEREWITH. IN FURTHERANCE OF THE
FOREGOING, THE COMPANY HEREBY WAIVES, RELEASES AND AGREES NOT TO XXX UPON ANY
CLAIM FOR ANY SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR
SUSPECTED TO EXIST IN ITS FAVOR.
12.17 Entire Agreement; Amendment. This Agreement, the Note, and the other
Loan Documents referred to herein embody the final, entire Agreement among the
parties hereto and supersede any and all prior commitments, agreements,
representations, and understandings, whether written or oral, relating to the
subject matter hereof. The provisions of this Agreement and the other Loan
Documents to which the Company is a party may be amended or waived only by an
instrument in writing signed by the parties hereto.
12.18 NO ORAL AGREEMENTS. THE WRITTEN LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BANC NLC MORTGAGE LENDING, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Executive Vice President
NLC FINANCIAL SERVICES, LLC
By: /s/ Xxxx Xxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxx
Title: President
52
BANK UNITED
By: /s/ Xxxxxx Xxxxxx
-------------------------------
Name: XXXXXX XXXXXX
Title: VP and Director
53
EXHIBITS:
A - Advance Request
B - Existing Company Indebtedness
C - Procedures and Documentation for Warehousing Single-family Mortgage Loans
D - Shipping Instructions
E - Trust Receipt
F - Officer's Certificate
G - Subsidiaries
H - Litigation
I - Trade Names
J - Secretary's Certificate
K - Bailee Letter
L - Investors
M - Legal Opinion
N - Note
54
EXHIBIT A
[LOGO] Bank United
ADVANCE REQUEST FORM- SINGLE-FAMILY MORTGAGE LOANS
Loan Information
Mortgage Company: Loan Number:
---------------------------------------------------- -------------------------------
Mortgagor: Prepared By:
---------------------------------------------------- -------------------------------
Street Address: Warehouse Date: / /
---------------------------------------------------- ---- ---- ---------------------
City, State, Zip: SSN: - -
---------------------------------------------------- -- -- -- -- -- -- -- -- -- --
Note Amount: $ Note Date: / /
----------------------------------- ---- ---- --------------------------
Advance Request: $ [ ] Wet [ ] Regular (Dry)
-----------------------------------
Loan-Specific Take-out Commitment? [ ] Yes [ ] No Mortgage Loan Interest Rate: %
----------------
(If "Yes," Investor: . Expiration date: / / . Take-out Price: %).
----------------------- -- -- ---- -----------------------------
LTV of Mortgage Loan is: % (If over 100%, FICO score: ).
--------- -----------------
Documentation is: [ ] Stated Doc [ ] Full Doc
Loan Type (check all that apply): [ ] 1st lien [ ] 2nd lien [ ] FNMA/FHLMC [ ] FHA/VA [ ] Jumbo [ ] Subprime
Closing Agent Information
Closing Agent is: [ ] Title Company [ ] Attorney
Name: Phone: ( ) -
---------------------------------------------------- ---------- ---------- --------------
Address:
------------------------------------------------------------------------------------------------------
Method of Advance
[ ] Wire Transfer (instructions included) [ ] Bank United Check [ ] Bank United Cashier's Check
Wire Amount: $ . Check Amount: $ . Check Amount: $ .
------------ --- ------------ --- ----------- ---
[ ] Please debit the $ . difference from our account number - -
---------------------- --- -- -- -- -- -- -- -- --
Wire Instructions
Receiving Bank: ABA Number: - -
---------------------------------- -- -- -- -- -- -- -- -- --
City: State:
---------------------------------- -----------------------------------------------
Account Name: Account Number:
---------------------------------- -----------------------------------------------
Required Documentation
Wet Settlement Advance Regular (Dry) Advance
[ ] Completed Advance Request form [ ] Completed Advance Request form
[ ] Copy of Purchase Commitment [ ] Original Mortgage Note endorsed in
blank
[ ] Insured Closing Letter from Title Company or [ ] Original Assignment of Mortgage in
blank
Closing Instructions from Company to Closing Agent [ ] Copy of Mortgage certified by the
Closing Agent as a
[ ] If closing by check, a copy of the check true copy of the original sent for recording
We will deliver the following within 5 days: [ ] Copy of Purchase Commitment
[ ] Original Mortgage Note endorsed in blank [ ] Insured Closing Letter from Title
Company or
[ ] Original Assignment of Mortgage in blank Closing Instructions from Company to
Closing Agent
[ ] Copy of Mortgage certified by the Closing Agent as a true copy of the original sent for recording.
55
Subwarehouse Mortgage Loan Advance
We will deliver the following within 2 days:
[ ] Copy of Mortgage Note
[ ] all necessary endorsements
56
BAILEE PLEDGE
The Company creates and grants in favor and for the benefit of the Lender a
security interest in and to the Single-family Mortgage Loans listed above and
all instruments and documents described as Required Documentation above.
The Company has given to
--------------------------------------------------
("Closing Agent") who has possession of such instruments and documents, notice
of the foregoing described security interest in favor of the Lender.
The Company further agrees to deliver the documents described above to
Lender, immediately upon the request of the Lender (whether written or oral),
but in any event, on or before three (3) calendar days from the date hereof.
The Company further agrees that this Agreement shall be binding upon and
inure to the benefit of the legal representatives, successors or assigns of the
Lender.
The Company further agrees that all rights, interests, duties and
liabilities arising hereunder shall be determined according to the laws of the
State of Texas.
Executed as of the day of , .
--------------- ---------------------- --------
BANC NLC MORTGAGE LENDING, LLC
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
57
EXHIBIT B
LIST OF EXISTING INDEBTEDNESS OF COMPANY
-----------------------------------------------------------------------
AVERAGE BALANCE
TYPE OF COMMITMENT OUTSTANDING AS OF
LENDER FINANCING AMOUNT COLLATERAL JANUARY 28, 2000
-----------------------------------------------------------------------
IMC Mtg. Warehouse $ 5,000,000 Loans 1,560,399.57
-----------------------------------------------------------------------
Xxxxx Xxxxxx Warehouse $15,000,000 Loans 5,334,698.77
-----------------------------------------------------------------------
Household Warehouse $25,000,000 Loans 24,773,867.55
Finance
-----------------------------------------------------------------------
-----------------------------------------------------------------------
58
EXHIBIT C
PROCEDURES AND DOCUMENTATION FOR WAREHOUSING
SINGLE-FAMILY MORTGAGE LOANS
The following procedures and documentation requirements must be observed in
all respects by the Company. All documents must be satisfactory to Lender in its
sole discretion. Terms used below, which are not otherwise defined, shall have
the meanings given them in the Warehousing Credit and Security Agreement, as
amended, modified or renewed from time to time.
I. Prior to making an Advance that is not a Wet Settlement Advance, the Lender
must receive the following:
1) Copy of settlement or funding check issued to, or signed wire transfer
request directing funds to escrow/title company or closing agent.
2) If not an Electronic Request, Original Request for Advance against
Single-Family Mortgage Loans (Exhibit A).
3) Original signed Mortgage Note, endorsed by the Company in blank with
corresponding interim endorsements, if applicable.
4) Copy of the Mortgage certified true by the escrow/title company or
closing agent.
5) Certified true copies of all interim assignments (recorded or sent for
recordation) of the Mortgage.
6) An Assignment of the Mortgage to the Lender in recordable form but
unrecorded.
7) Copy of specific Purchase Commitment, if any.
II. Prior to making a Wet Settlement Advance or a Subwarehouse Advance, the
Lender must receive the following:
1) Copy of settlement or funding check issued to, or signed wire transfer
request directing funds to escrow/title company or closing agent.
2) If not an Electronic Request, Original Request for Advance against
Single-Family Mortgage Loans (Exhibit A).
-59-
3) Copy of specific Purchase Commitment, if any.
4) A copy of the Company's final closing instructions to the title
company or closing agent, noting Lender's security interest in the
loan, as provided below:
"You are hereby notified that Bank United, a federal savings bank (the
"Lender") has a security interest in the promissory note, the deed of
trust or mortgage, and all other supporting documents for the above
referenced loan. Unless the Lender otherwise instructs you, all loan
documents are to be returned to the undersigned company within
twenty-four (24) hours after settlement."
The original Mortgage Note and other supporting documents described in Section I
must be received by the Lender within five (5) Business Days of the date of the
Wet Settlement Advance. A copy of the Subwarehouse Mortgage Note and all
necessary endorsements shall be received within two (2) Business Days of any
Subwarehouse Mortgage Loan Advance.
III. The Lender exclusively shall deliver Pledged Mortgages and all related loan
documents and/or pool documents to Investor or Approved Custodian unless
otherwise agreed in writing.
IV. The following procedures are to be followed for deliveries of Pledged
Mortgages to Investors:
No later than 2:00 p.m. Houston, Texas time one (1) Business Day prior to
the expiration date of the Purchase Commitment, the Lender must receive the
following:
1) Signed or electronic shipping instructions for the delivery of the
Pledged Mortgages including the following:
a) Name and address of the office of the Investor to which the loan
documents are to be shipped and the preferred method of delivery;
b) Instructions for endorsement of the Mortgage Note;
c) Names of Mortgagor and Mortgage Note Amounts of Pledged Mortgages
to be shipped; and
d) Number and expiration date of the Purchase Commitment.
-60-
2) All loan documents related to the Pledged Mortgages required for
delivery to the Investor.
-61-
EXHIBIT D
FORM OF SHIPPING REQUEST AND AUTHORIZATION
[Company Letterhead]
Date:
-----------------------
BANK UNITED
[Address]
Attention: Re: Commitment No.
--------------------------------- ----------
This letter is to serve as authorization for you to endorse and ship Loan
Documents for the following loans:
Loan Number Borrower Name Note Amount
----------- ------------- -----------
to the following address:
NAME:
ADDRESS:
ATTENTION:
Please endorse the notes as follows:
Please ship the Loan Documents either by or by
---------------------------------
such other courier service we have specifically approved in writing. You are not
responsible for any delays in shipment or any other actions or inactions of the
courier. However, because the commitment expires on , ,
------------------- ------
we ask that you deliver the Loan Documents to the courier no later than
, .
---------------------------- ------
Please have the courier xxxx us by using our account no. .
----------------------
If you should have any questions, or should feel the need for additional
documentation, please do not hesitate to call .
---------------------
BANC NLC MORTGAGE LENDING, LLC
By:
--------------------------
Name:
------------------------
Title:
-----------------------
-62-
EXHIBIT E
TRUST RECEIPT
Trust Receipt No. ,
---------------------- ----------------------- ----------
The undersigned, Banc NLC Mortgage Lending, LLC, a Florida limited
liability company (the "Company"), acknowledges receipt from Bank United, a
federal savings bank ("Lender"), pursuant to that certain Warehousing Credit and
Security Agreement (Single-Family Mortgage Loans) dated effective as of
, , by and between the Company and
------------------------ -------- --------
Lender (the "Agreement"), of the following described property (the "Trust
Property"), possession of which is herewith entrusted to the Company for the
purposes set forth below:
Mortgage Loan No. Note Amount:
------------------------ --------------------
Obligor:
---------------------------------
Purpose: [Specify nature of clerical or other documentation problem to be
corrected.]
The Company hereby acknowledges that a security interest in the Trust
Property and in the proceeds of the Trust Property has been granted to the
Lender pursuant to the Agreement.
In consideration of the delivery of the Trust Property by the Lender to the
Company, the Company hereby agrees to hold the Trust Property in trust for the
Lender as provided under and in accordance with all provisions of the Agreement
and to return the Trust Property to the Lender no later than the close of
business on the tenth day following the date hereof or, if such day is not a
Business Day, on the following Business Day. The Company further agrees that the
aggregate Collateral Value of Single-family Mortgage Loans with respect to which
notes or other documentation has been released under trust receipts, does not
exceed $500,000.00.
BANC NLC MORTGAGE LENDING, LLC
By:
--------------------------
Name:
------------------------
Title:
-----------------------
-63-
Delivery to Company Acknowledged:
BANK UNITED
By:
---------------------------------
Name:
--------------------------------
Title:
-------------------------------
The undersigned acknowledges that the above-mentioned Trust Property has been
returned to the Lender on , .
-------------------------- --------
BANK UNITED
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
-64-
EXHIBIT F
OFFICER'S CERTIFICATE
COMPANY: BANC NLC MORTGAGE LENDING, LLC
/NLC FINANCIAL SERVICES, LLC
LENDER: BANK UNITED
DATE:
-------------
REPORTING PERIOD: ended ,
------------------------------ ---------------- ------
This certificate is delivered to Lender under the Warehousing Credit and
Security Agreement dated effective as of
, 2000, between Company
-------------------------------------------- ---------
and Lender (the "Agreement"), all the defined terms of which have the same
meanings when used herein.
I hereby certify that: (a) I am, and at all times mentioned herein have
been, the duly elected, qualified, and acting officer of Company designated
below; (b) to the best of my knowledge, the Financial Statements of Company for
the period shown above (the "Reporting Period") and which accompany this
certificate were prepared in accordance with GAAP and present fairly the
financial condition of Company as of the end of the Reporting Period and the
results of its operations for the Reporting Period; (c) a review of the
Agreement and of the activities of the Company during the Reporting Period has
been made under my supervision with a view to determining Company's compliance
with the covenants, requirements, terms, and conditions of the Agreement, and
such review has not disclosed the existence during or at the end of the
Reporting Period (and I have no knowledge of the existence as of the date
hereof) of any Event of Default or Default, except as disclosed on the Annex
hereto (which specifies the nature and period of existence of each Event of
Default or Default, if any, and what action Company has taken, is taking, and
proposes to take with respect to each); (d) the calculations described on the
attached Annex evidence that the Company is in compliance with the requirements
of Sections 7.5 and 7.6 of the Agreement at the end of the Reporting Period (or
if Company is not in compliance, showing the extent of non-compliance and
specifying the period of non-compliance and what actions the Company proposes to
take with respect thereto; (e) the Company was, as of the end of the Reporting
Period, in compliance and good standing with any applicable FNMA, GNMA, FHLMC,
and HUD net worth requirements.
BANC NLC MORTGAGE LENDING, LLC
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
-65-
ANNEX TO EXHIBIT F
COMPANY NAME: BANC NLC MORTGAGE LENDING, LLC
REPORTING PERIOD:
-----------------------------------------
All financial calculations set forth herein are as of the Reporting Period.
(a) TANGIBLE NET WORTH
The Tangible Net Worth of the Company is:
GAAP Net Worth: $
-------------
Minus: Intangible Assets, including Capitalized Servicing
Rights: $
-------------
Minus: Advances or loans to shareholders, officers or
Affiliates $
-------------
Minus: Investments in Affiliates: $
-------------
Minus: Assets pledged to secure liabilities not included in
Debt: $
-------------
Minus: Any other HUD nonacceptable assets: $
-------------
TANGIBLE NET WORTH: $
-------------
(b) ADJUSTED TANGIBLE NET WORTH
The Adjusted Tangible Net Worth of the Company is:
Tangible Net Worth (from above): $
-------------
Plus: Subordinated Debt $
-------------
ADJUSTED TANGIBLE NET WORTH: $
-------------
Minimum Adjusted Tangible Net Worth is $
-------------
-66-
Covenant Satisfied: Covenant Not Satisfied:
---------------- ----------------
(c) DEBT OF THE COMPANY
Total Liabilities: $
-------------
DEBT: $
-------------
(d) DEBT TO ADJUSTED TANGIBLE NET WORTH
The ratio of Debt to Adjusted Tangible Net Worth is: to 1.
-----------------
Maximum Debt to Adjusted Tangible Net Worth Ratio is : .
------------ ---------
Covenant Satisfied: Covenant Not Satisfied:
------------------ -----------------
(e) DEFAULTS OR EVENTS OF DEFAULT (disclose nature and period of existence and
action being taken in connection therewith; if none, state none)
-67-
EXHIBIT G
LIST OF SUBSIDIARIES
--------------------------------------------------------------------
WHERE
ADDRESS OF STATE OF QUALIFIED COMPANY'S
PRINCIPAL INCORPORATION FOREIGN PERCENTAGE
NAME OFFICE OR FORMATION CORP. OWNERSHIP
--------------------------------------------------------------------
HKL, LLC 000 X. Xxxxxxxxx XX XX 000%
Xxxx., Xxxxxxxxx
Xxxxx, XX 00000
--------------------------------------------------------------------
--------------------------------------------------------------------
-68-
EXHIBIT H
DISCLOSURE OF PENDING LITIGATION
(Include the caption of the case, including styling, cause number, and court in
which it is pending, date filed, status of the proceedings, and description of
claims, counterclaims and damages asserted.)
NONE.
-69-
EXHIBIT I
TRADE NAMES OF COMPANY
TRADE NAME JURISDICTION USED
NLC Mortgage Lending, LLC GA, IL, MI, PA, NV, CO and UT
-70-
EXHIBIT J
RESOLUTIONS AND
INCUMBENCY CERTIFICATE OF OFFICERS
(BORROWING AUTHORITY)
I, the undersigned, hereby certify that I am the Executive Vice President
of BANC NLC MORTGAGE LENDING, LLC, a limited liability company duly organized
and existing under the laws of the State of Florida (the "Company").
I further certify that true and correct copies of the Articles of Formation
of the Company together with all amendments thereto are attached hereto as
Exhibits A and B, respectively, and that such certificate and agreement remain
unaltered and in full force and effect.
I further certify that the following resolutions were duly adopted by the
Board of Managers of the Company at a meeting of the Board of Managers of the
Company, duly and legally called and held in accordance with the Articles of
Formation of the Company on the 31st day of January, 2000, at which meeting a
quorum was present and voting throughout, or (if the foregoing date was not
completed) pursuant to a written consent signed by all of the members of the
[Board of Directors] of the Company in accordance with the Articles of Formation
of the Company, and that such resolutions are now in full force and effect and
have not been amended, modified or revoked:
"RESOLVED, that each of the following officers of this Company:
Xxxx Xxxxxxxx, President - Xxxxxxx Xxxxxxxx, Executive Vice President
acting alone without the joinder of any other officer, is hereby authorized
in the name and on behalf of this Company (i) to borrow from and to
otherwise incur liabilities to BANK UNITED ("Lender") from time to time, in
such amounts, for such periods of time, at such rates of interest and
payable in such manner as such officers may deem necessary or proper, and
(ii) as evidence of such indebtedness so incurred, to execute and deliver
to Lender such promissory notes, loan agreements and other instruments,
documents and agreements, containing such terms and provisions as may be
acceptable or agreeable to any one of such officers, such acceptance and
agreement to be conclusively evidenced by the execution and delivery
thereof by any one of such officers;
FURTHER RESOLVED, that this Company grant to Lender a lien and/or
security interest upon such assets of this Company as may be agreed upon
between any one of the above named officers and Lender, as security for all
present and future indebtedness, obligations and liabilities of this
Company to Lender and that each of said officers, acting alone without the
joinder of any other officer, is hereby authorized in the name and on
behalf of this Company to execute and deliver such security agreements,
deeds of trust and other
-71-
instruments, documents and agreements as may be required by Lender in
connection with each such grant of a lien and/or security interest and
containing such terms and provisions as may be acceptable or agreeable to
any one of such officers, such acceptance and agreement to be conclusively
evidenced by the execution and delivery thereof by any one of such
officers;
FURTHER RESOLVED, that any one of the above named officers, acting
alone without the joinder of any other officer, is hereby authorized in the
name and on behalf of this Company to take such further action and to do
all things that any one of such officers deems necessary in connection with
any (i) increases, renewals, extensions, rearrangements, retirements or
compromises of any indebtedness, obligations and liabilities owing to
Lender from time to time by this Company, either directly or by assignment,
and (ii) amendments to any of the provisions contained in any instruments,
documents or agreements evidencing, securing, governing and/or pertaining
to any indebtedness, obligations and liabilities owing to Lender by this
Company from time to time;
FURTHER RESOLVED, that any one of the above named officers, or any one
of the following representatives of this Company:
Xxxx Xxxxxxxx, President - Xxxxxxx Xxxxxxxx, Executive Vice President
Xxxxxx Xxxxxxx, Senior Vice President; and Xxx Xxxxxx, Vice President
acting alone without the joinder of any other officer or representative, is
hereby authorized in the name and on behalf of this Company to (i) make
requests for advances under any credit facility that this Company may have
with Lender from time to time, and (ii) do or cause to be done all such
acts or things and to sign and deliver, or cause to be signed and
delivered, all such instruments, documents, agreements and certificates
(including without limitation, any and all notices and certificates
required or permitted to be given or made to Lender under the terms of any
of the instruments, documents or agreements executed on behalf of this
Company in connection with these resolutions), as any and all of such
officers or representatives may deem necessary, advisable or appropriate to
effectuate and carry out the purposes and intent of the foregoing
resolutions and to perform the obligations of this Company under all
instruments, documents and agreements executed on behalf of this Company in
connection with any indebtedness, obligations or liabilities incurred by
this Company to Lender from time to time;
FURTHER RESOLVED, that any one of the above named officers, acting
alone without joinder of any other officer or representative is hereby
authorized in the name and on behalf of this Company (i) to sell and
transfer notes, securities and financial instruments of this Company to the
Lender, from time to time, in such amounts and on such terms and conditions
and in such manner as any one of such officers may deem necessary or proper
and (ii) in connection therewith, to execute and deliver to the Lender a
master repurchase agreement and such other documents and agreements
containing such terms and provisions as may be
-72-
acceptable or agreeable to any one of such officers, such acceptance and
agreement to be conclusively evidenced by the execution and delivery
thereof by any one of such officers;
FURTHER RESOLVED, that all acts, transactions or agreements with
Lender undertaken prior to the adoption of the foregoing resolutions by any
one or more of the officers and/or representatives of this Company in its
name and on its behalf in connection with the foregoing matters are hereby
ratified, confirmed and adopted by this Company; and
FURTHER RESOLVED, that each of the officers of this Company is hereby
authorized and directed to certify these resolutions to Lender;
FURTHER RESOLVED, the foregoing resolutions shall continue in full
force and effect, and the Lender is authorized to rely upon the foregoing
resolutions unless and until (i) countermanded by resolution of the [Board
of Directors] of this Company, and (ii) a copy of such resolution, properly
certified by an officer of this Company, has actually been received by
Lender."
I further certify that the foregoing resolutions do not conflict with the
Articles of Formation of the Company, or any amendments thereto.
I further certify that neither the seal of the Company, nor the attestation
by the Secretary, Assistant Secretary or any other officer of the Company, is
necessary to make any instruments, documents or agreements executed by the
officers or representatives of this Company pursuant to the foregoing
resolutions, enforceable against the Company, unless such seal is affixed to, or
such attestation is provided on, such instruments, documents or agreements.
I further certify that the officers of the Company set forth below have
been duly elected and qualified and as of the date hereof hold the specified
offices with the Company, that the signature set forth beside each officer's
name is the true signature of such officer, and that the signature set forth
beside the name of each of the representatives specified in the foregoing
resolutions is the true signature of such representative:
-73-
TITLE TYPED NAME SIGNATURE
President Xxxx Xxxxxxxx
-------------------------
Vice President Xxxxxxx X. Xxxxxxxx
-------------------------
Treasurer Xxxx Xxxxx
-------------------------
Secretary Xxxxx Xxxxxx
-------------------------
Assistant Secretary Xxxxxxx X. Xxxxxxxx
-------------------------
IN WITNESS WHEREOF, I hereunto subscribe my name this day of
-------
, .
------------ -------
------------------------------------
------------------------------------
(Printed Name)
------------------------------------
(Title)
-74-
EXHIBIT K
BAILEE LETTER
(Investor Name and Address)
Re: Purchase of Mortgage Loans from Banc NLC Mortgage Lending, LLC
Ladies and Gentlemen:
Attached please find those Mortgage Loans listed separately on the attached
schedule, which Mortgage Loans are owned by Banc NLC Mortgage Lending, LLC, a
Florida limited liability company (the "Company") and are being delivered to you
for purchase.
The Mortgage Loans comprise a portion of the Collateral under (and as the
term "Collateral" and capitalized terms not otherwise defined hereunder are
defined in) that certain Warehousing Credit and Security Agreement
(Single-family Mortgage Loans) ("Warehouse Agreement") dated effective as of
, 2000, by and between the Company and BANK UNITED, a
----------------- --------
federal savings bank ("Lender"). Each of the Mortgage Loans is subject to a
security interest in favor of Lender, which security interest shall be
automatically released upon our receipt of the full amount due to the Lender
under the Warehouse Agreement in connection with such Mortgage Loans (as set
forth on the schedule attached hereto) by wire transfer to the following
account:
Bank United
Houston, Texas
ABA #000000000
Credit:
-----------------
Account:
-----------------------
Until payment therefor is received, the aforesaid security interest therein
will remain in full force and effect, and you shall hold possession of such
Collateral and the documentation evidencing same as custodian, agent and bailee
for and on behalf of Lender. In the event any Mortgage Loan is unacceptable for
purchase, return the reject item directly to the undersigned at the address set
forth below. In no event shall any Mortgage Loan be returned or sales proceeds
remitted in full no later than thirty (30) days from the date hereof. If you are
unable to comply with the above instructions, please so advise the undersigned
immediately.
-75-
NOTE: BY ACCEPTING THE MORTGAGE LOANS DELIVERED TO YOU WITH THIS LETTER,
YOU CONSENT TO BE THE CUSTODIAN, AGENT AND BAILEE FOR LENDER ON THE TERMS
DESCRIBED IN THIS LETTER. THE UNDERSIGNED REQUESTS THAT YOU ACKNOWLEDGE RECEIPT
OF THE ENCLOSED MORTGAGE LOANS AND THIS LETTER BY SIGNING AND RETURNING THE
ENCLOSED COPY OF THIS LETTER TO THE UNDERSIGNED AT THE FOLLOWING ADDRESS: 0000
Xxxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxx 00000.
HOWEVER, YOUR FAILURE TO DO SO DOES NOT NULLIFY SUCH CONSENT.
Sincerely,
BANK UNITED
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
IRREVOCABLY ACKNOWLEDGED
AND AGREED TO:
[INVESTOR]
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
-76-
EXHIBIT L
LIST OF INVESTORS
CURRENT INVESTORS
------------------------------------------------------------------------------------------------------
Investor Name Contact Address Phone
------------------------------------------------------------------------------------------------------
Impac Funding Corp. Xxxxx X. Xxxxx 000 Xxxxxx Xxxxxx Xxxxx, Xxx 0000 813-822-249
Vice Pres. Eastern Reg. Xx. Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------
Metropolitan Mortgage Xxxxxx X. Xxxxx 0000 Xxxxxxxx Xxxxxxxxx 000-000-000
Senior Vice President Xxxxx, XX 00000
------------------------------------------------------------------------------------------------------
Residential Funding Corp. Xxxxxx Xxxxxxx One Meridian Crossings, Suite 100 727-530-156
Marketing Director Xxxxxxxxxxx, XX 00000
Consumer Fin. Acquis.
------------------------------------------------------------------------------------------------------
Assoc. Home Equity Sys. Xxxxx Xxxxxxx 0000 Xxxxxxx 00 813-870-755
Vice President Xxxxxxxxx, XX 00000
Wholesale Ops
------------------------------------------------------------------------------------------------------
Bank of America Xxx Xxxxxx 0000 Xxxxxxxxxx Xxxxxx 813-655-764
(Equicredit) Account Executive Xxxxxxx, XX 00000
Home Equity Servicing
Acquisitions
------------------------------------------------------------------------------------------------------
*Bank One Fin. Sys, Inc. Xxxxxx X. Xxxxxx 0000 Xxxxxx Xxx, Xxxxx 000 800-347-173
Senior Vice President Xx. Xxxxxx, XX 00000-0000
------------------------------------------------------------------------------------------------------
Chase Manhattan Mtg. Xxxxx X. Tafuno 000 Xxxx Xxxx., 0x Xxxxx Xxxxx 000-000-000
National Sales Manager XxxxxxxxxXxxx, XX 00000
------------------------------------------------------------------------------------------------------
*GE Capital Mtg. Sys, Inc. Ray Robac Three Executive Campus 000-000-000
Account Executive Xxxxxx Xxxx, XX 00000
------------------------------------------------------------------------------------------------------
*Household Financial Sys. Xxxx X. Xxxxx 00000 Xxxxxxx Xxxxx, Xxxxx 000-00 800-840-667
Vice President Xxxxx, XX 00000
Eastern Reg. Sales Dir.
------------------------------------------------------------------------------------------------------
Impac Funding Corporation Xxxxx X. Xxxxx 000 Xxxxxx Xxxxxx Xxxxx, Xxx 0000 813-822-249
Vice Pres. Eastern Reg. Xx. Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------
Metropolitan Mortgage Xxxxxx X. Xxxxx 0000 Xxxxxxxx Xxxxxxxxx 000-000-000
Senior Vice President Xxxxx, XX 00000
------------------------------------------------------------------------------------------------------
Provident Consumer Fin. Xx Xxxxxxxx 000 Xxxx Xxxxxx, 195ID 000-000-000
Bulk Acquis. Manager Xxxxxxxxxx, XX 00000
------------------------------------------------------------------------------------------------------
Residential Funding Corp. Xxxxxx Xxxxxxx One Meridian Crossings, Suite 100 727-530-156
Marketing Director Xxxxxxxxxxx, XX 00000
Consumer Fin. Acquis.
------------------------------------------------------------------------------------------------------
Saxon Mortgage, Inc. J. Xxxxx Xxxxx 0000 Xxx Xxxx 000-000-000
Jr. Acct. Manager Xxxx Xxxxx, XX 00000
------------------------------------------------------------------------------------------------------
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EXHIBIT M
OPINION LETTER
, 2000
------------------------------- --------
Bank United
Xxxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxx 00000
Re: Warehousing Credit and Security Agreement (Single-Family Mortgage
Loans)
Gentlemen:
We have acted as special counsel for Banc NLC Mortgage Lending, LLC, a
Florida limited liability company (the "Company"), in connection with the
negotiation and execution of the following documents (collectively, the "Credit
Documents"):
1. the Warehousing Credit and Security Agreement (Single-Family Mortgage
Loans) dated effective as of ,
----------------------------- -------
2000 (the "Loan Agreement"), between the Company and Bank United (the
"Lender"); and
2. the Note dated effective as of ,
------------------------------- ------
2000 (the "Note"), executed and delivered by the Company.
Unless otherwise provided herein, terms used herein which are defined in
the Credit Documents (including schedules and exhibits thereto) and not defined
herein shall have the meanings attributed thereto in the Credit Documents.
I. Basis of Opinion.
As the basis for the conclusions expressed in this opinion letter, we have
examined, considered and relied upon the following:
A. A copy of each of the Credit Documents executed by the Company;
B. Recent Certificates of Existence and Good Standing of the Company
issued by the Secretary of State and Comptroller of the State of Florida;
C. A copy of the Articles of Formation and amendments thereto of the
Company, in each case as certified to us by the Company Certificate;
D. Such other documents and records as we have deemed relevant,
necessary or appropriate in connection with or as a basis for the opinions
hereafter set forth; and
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E. Such matters of law as we have considered necessary or appropriate
for the expression of the opinions contained herein.
For the purposes of this opinion letter, the documents and information
referred to in this Section I are herein collectively referred to as the
"Documents".
II. Opinions.
Based upon our examination and consideration of the foregoing Documents,
and subject to the comments, assumptions, exceptions, qualifications and
limitations set forth in Section III below, we are of the opinion that:
A. The Company (i) is a limited liability company duly organized,
validly existing, and in good standing under the laws of the State of Florida,
(ii) has the full legal power and authority and all necessary licenses, permits,
franchises, and other authorizations to own and operate its property and assets
and to transact the business in which it is engaged, and (iii) is duly qualified
to transact business as a foreign limited liability company in each jurisdiction
where the nature of the business it transacts or the property it owns requires
such qualification or licensing except in such jurisdictions where the failure
to be in good standing or be licensed (as the case may be) would have no
material adverse effect on the Company.
B. The Company has the requisite power to execute, deliver, and
perform the terms and provisions of each of the Credit Documents and has taken
all necessary action to authorize the execution, delivery, and performance by it
of each such Credit Document. The Company has duly executed each of the Credit
Documents, and each such Credit Document constitutes its legal, valid, and
binding obligation enforceable in accordance with its terms, except as the
enforceability of the rights and remedies of the Lender under each of the Credit
Documents may be limited by applicable bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights generally and
by general equitable principles (regardless of whether the issue of
enforceability is considered in a proceeding in equity or at law) including
requirements of reasonableness and good faith in the exercise of rights and
remedies under the Credit Documents.
C. Neither the execution, delivery, or performance by the Company of
the Credit Documents, nor compliance by it with the terms and provisions
thereof, (i) will contravene any law, statute, rule, or regulation; (ii) to the
best of our knowledge, will contravene any order, writ, injunction, or decree of
any court or governmental instrumentality; (iii) to the best of our knowledge,
will conflict or be inconsistent with or result in any breach of any of the
material terms, covenants, conditions, or provisions of, or constitute a default
under, or result in the creation or imposition of (or the obligation to create
or impose) any lien upon any of the property or assets of the Company pursuant
to the terms of any agreement of the Company; (iv) will violate any provision of
the Articles of Formation of the Company.
D. No order, consent, approval, license, authorization or validation
of, or filing, recording or registration with, or exemption by, any governmental
or public body or
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authority, or any subdivision thereof, is required to authorize, or is required
in connection with, (i) the execution, delivery and performance of any Credit
Document, or (ii) the legality, validity, binding effect or enforceability of
any such Credit Document.
E. To the best of our knowledge, there are no actions, suits, or
proceedings pending or threatened (i) with respect to any Credit Document or
(ii) that could materially and adversely affect the business, operations,
property, assets, condition (financial or otherwise) or prospects of the
Company.
F. The Company is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
G. The Company is not a "holding company" or a "subsidiary company" of
a "holding company" within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
H. The execution and delivery of the Loan Agreement by the Borrower is
effective to create a valid and enforceable security interest in favor of the
Lender in the Collateral and the proceeds thereof.
I. The Lender will have a valid and duly perfected security interest,
without further requirements for perfection, in (a) the Pledged Mortgages upon
the delivery thereof to the Lender and (b) the other Collateral described in the
Financing Statements to the extent that a security interest therein may be
perfected under Article 9 of the UCC solely by filing a financing statement with
the Secretary of State of Florida, which lien shall be superior to any other
interests therein.
III. Comments, Assumptions, Limitation, Qualifications and Exceptions.
The opinions expressed in Section II above are based upon, and subject to,
the further comments, assumptions, limitations, qualifications and exceptions
set forth below:
[list]
Respectfully submitted,
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EXHIBIT N
PROMISSORY NOTE
$25,000,000.00 Houston, Texas As of , 2000
-----------------
FOR VALUE RECEIVED, the undersigned, BANC NLC MORTGAGE LENDING, LLC, a
Florida limited liability company (herein called the "Borrower," hereby promises
to pay to the order of BANK UNITED, a federal savings bank (the "Lender" or,
together with its successors and assigns, the "Holder") whose principal place of
business is 0000 Xxxxxxxxx Xxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, ATTN:
Mortgage Banker Finance, or at such other place as the Holder may designate from
time to time, the principal sum of TWENTY-FIVE MILLION AND NO/100 DOLLARS
($25,000,000.00) or so much thereof as may be outstanding from time to time
pursuant to the Warehousing Credit and Security Agreement (the "Agreement")
dated of even date herewith between the Borrower and the Lender, as the same has
been amended and supplemented or may be amended or supplemented from time to
time, and to pay interest on said principal sum or such part thereof as shall
remain unpaid from time to time, from the date of each Advance until repaid in
full, and all other fees and charges due under the Agreement, at the rate and at
the times set forth in the Agreement. All payments hereunder shall be made in
lawful money of the United States and in immediately available funds.
This Note is given to evidence an actual warehouse line of credit in the
above amount and is the Note referred to in the Agreement, and is entitled to
the benefits thereof. Reference is hereby made to the Agreement (which is
incorporated herein by reference as fully and with the same effect as if set
forth herein at length) for a description of the Collateral, required payments
of principal and interest on this Note, a statement of the covenants and
agreements, a statement of the rights and remedies and securities afforded
thereby and other matters contained therein. Capitalized terms used herein,
unless otherwise defined herein, shall have the meanings given them in the
Agreement.
The entire unpaid principal balance of this Note plus all accrued and
unpaid interest shall be due and payable in full on .
---------------------
This Note may be prepaid in whole or in part at any time without premium or
penalty.
Should this Note be placed in the hands of attorneys for collection, the
Borrower agrees to pay, in addition to principal and interest, fees and charges
due under the Agreement, and all costs of collecting this Note, including
reasonable attorneys' fees and expenses.
This Note shall be construed and enforced in accordance with the laws of
the State of Texas, without reference to its principles of conflicts of law, and
applicable federal laws of the United States of America.
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This Note is secured by all security agreements, collateral assignments,
deeds of trust and lien instruments executed by the Borrower in favor of Lender,
or executed by any other Person as security for this Note, including any
executed prior to, simultaneously with, or after the date of this Note and
including, without limitation, the Security Documents.
The Borrower and any and each co-maker, guarantor, accommodation party,
endorser or other Person liable for the payment or collection of this Note
expressly waive notice, presentment, demand for payment, protest, notice of
protest and non-payment or dishonor, notice of acceleration, notice of intent to
accelerate, notice of intent to demand, bringing of suit, and diligence in
taking any action to collect amounts called for hereunder and in the handling of
Collateral at any time existing as security in connection herewith, and shall be
directly and primarily liable for the payment of all sums owing and to be owing
hereon, regardless of and without any notice, diligence, act or omission as or
with respect to the collection of any amount called for hereunder or in
connection with any Lien at any time had or existing as security for any amount
called for hereunder.
It is the intention of the parties hereto to conform strictly to usury laws
applicable to the Lender. Accordingly, if the transactions contemplated hereby
would be usurious under applicable law (including the laws of the United States
of America and the State of Texas), then, in that event, notwithstanding
anything to the contrary herein or in the Agreement or in any other Loan
Document or agreement entered into in connection with or as security for this
Note, it is agreed as follows: (i) the aggregate of all consideration which
constitutes interest under law applicable to the Lender that is contracted for,
taken, reserved, charged, or received herein or under the Agreement or under any
of the other aforesaid Loan Documents or agreements or otherwise in connection
herewith shall under no circumstances exceed the maximum amount allowed by such
applicable law, and any excess shall be credited by the Lender on the principal
amount of the Obligations (or, if the principal amount of the Obligations shall
have been paid in full, refunded by the Lender to the Borrower, as required);
and (ii) in the event that the maturity of this Note is accelerated by reason of
an election of the required or permitted prepayment, then such consideration
that constitutes interest under law applicable to the Lender may never include
more than the maximum amount allowed by such applicable law, and excess
interest, if any, provided for in the Agreement or otherwise shall be canceled
automatically as of the date of such acceleration or prepayment and, if
theretofore paid, shall be credited by the Lender on the principal amount of the
Obligations (or, if the principal amount of the Obligations shall have been paid
in full, refunded by the Lender to the Borrower, as required). Without limiting
the foregoing, all calculations of the rate of interest taken, reserved,
contracted for, charged, received or provided for under this Note or any of the
Loan Documents which are made for the purpose of determining whether the
interest rate exceeds the Maximum Rate shall be made, to the extent allowed by
law, by amortizing, prorating, allocating and spreading in equal parts during
the period of the full stated term of the loan evidenced hereby, all interest at
any time taken, reserved, contracted for, charged, received, or provided for
under this Note or any of the Loan Documents. To the extent that the Section 303
of the Texas Finance Code is relevant for purposes of determining the Maximum
Rate, the Lender hereby elects to determine the applicable rate ceiling under
such statute by the weekly rate ceiling from time to time in effect,
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subject to the Lender's right subsequently to change such method in accordance
with applicable law.
BANC NLC MORTGAGE LENDING, LLC
By:
------------------------------------
Name:
Title:
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