SECOND AMENDMENT TO SECURED LOAN AGREEMENT
SECOND
AMENDMENT TO SECURED LOAN AGREEMENT
This
Second Amendment (this “Amendment”)
to the
Secured Loan Agreement referenced below is entered into as of June 29, 2006,
among Leaf
Fund
II, LLC, a Delaware limited liability company, as Borrower (the “Borrower”),
Leaf
Funding, Inc., a Delaware corporation, as Originator (the “Originator”),
Lease
Equity Appreciation Fund II, L.P., a Delaware limited partnership, as Seller
(the “Seller”),
Leaf
Financial Corporation, a Delaware corporation, as Servicer (the “Servicer”),
U.S.
Bank National Association, a national banking association, as Collateral Agent
(in such capacity, the “Collateral
Agent”)
and as
Securities Intermediary (in such capacity, the “Securities
Intermediary”)
and
WestLB AG, New York Branch, as Lender (the “Lender”).
R E C I T A L S:
WHEREAS,
the Borrower, the Originator, the Seller, the Servicer, the Collateral Agent,
the Securities Intermediary and the Lender are parties to the Secured Loan
Agreement, dated as of June 1, 2005 (as amended, supplemented and otherwise
modified from time to time, the “Secured
Loan Agreement”);
WHEREAS,
the parties hereto desire to amend the Secured Loan Agreement pursuant to
Section 14.04 thereof to make certain amendments thereto as further described
in
this Amendment;
NOW,
THEREFORE, in consideration of the mutual covenants and undertakings herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as
follows:
Section
1. Amendments
to the Secured Loan Agreement.
Effective as of the execution and delivery of this Amendment by all parties
hereto:
(a) The
definition of “Applicable Margin” in Appendix
A
to the
Secured Loan Agreement is hereby amended and restated in its entirety as
follows:
“Applicable
Margin”
means,
for each Advance and (i) any date prior to the Facility Termination Date, 0.95%
or (ii) any date that occurs on or after the Facility Termination Date,
1.85%.”
(b) The
definition of “Facility Termination Event” in Appendix
A
to the
Secured Loan Agreement is hereby amended and restated in its entirety as
follows:
“Facility
Termination Event”
means
the occurrence of any of the following: (i) an Event of Default, (ii) the
average of the Annualized Default Ratios on the Serviced Portfolio for the
three
most recently ended Collection Periods exceeds 2.5%, (iii) the average of the
Annualized Default Ratios on the Securitized Portfolio for the three most
recently ended Collection Periods exceeds 2.5%, (iv) the average of the NPA
Ratios for the Securitized Portfolio for the three most recently ended
Collection Periods exceeds 1.5% or (v) the Cumulative Net Loss exceeds the
percentages found in the column titled “Facility Termination Event” in the
definition of “Static Pool Test”; provided,
however,
that
any such Facility Termination Event (other than clause (ii) or clause (iii))
may
be waived by the Lender.
(c) The
definition of “Maximum Facility Amount” in Appendix
A
to the
Secured Loan Agreement is hereby amended and restated in its entirety as
follows:
“Maximum
Facility Amount”
means
$150,000,000.
(d) Section
8.01(m) of the Secured Loan Agreement is hereby amended and restated in its
entirety as follows:
“(m)
3-Month
Rolling Average of the Annualized Default Ratio (Serviced
Portfolio).
The
average of the Annualized Default Ratios on the Serviced Portfolio for the
three
most recently ended Collection Periods is equal to or greater than 3.50%;
or”
(e) Section
8.01(n) of the Secured Loan Agreement is hereby amended and restated in its
entirety as follows:
“(n)
3-Month
Rolling Average of the Annualized Default Ratio (Securitized
Portfolio).
The
average of the Annualized Default Ratios on the Securitized Portfolio for the
three most recently ended Collection Periods is equal to or greater than 3.50%;
or”
(f) Paragraph
(liii)(H) of Exhibit D to the Secured Loan Agreement is hereby amended and
restated in its entirety as follows:
“(liii)(H)
after giving effect to the addition of the Contract to the pool of Eligible
Contracts, the Aggregate Implicit Principal Balance of Eligible Contracts (as
of
any date of determination) with respect to which any one Person or any Affiliate
of such Person is the related Customer does not exceed (1) if the Aggregate
Implicit Principal Balance of the Eligible Contracts is less than $25,000,000,
4.0% of the Aggregate Implicit Principal Balance of all Eligible Contracts,
(2)
if the Aggregate Implicit Principal Balance of the Eligible Contracts is less
than $50,000,000 but is greater than $25,000,000, the greater of (x) $1,000,000
and (y) 3.0% of the Aggregate Implicit Principal Balance of all Eligible
Contracts and (3) if the Aggregate Implicit Principal Balance of the Eligible
Contracts is greater than $50,000,000, 3.0% of the Aggregate Implicit Principal
Balance of all Eligible Contracts;”
Section
2. Representations
and Warranties.
Each of
the Borrower, the Seller, the Servicer and the Originator hereby represents
and
warrants that (i) it has the power and is duly authorized to execute and deliver
this Amendment, (ii) this Amendment has been duly authorized, executed and
delivered, (iii) it is and will continue to be duly authorized to perform its
respective obligations under the Loan Documents and this Amendment, (iv) the
execution, delivery and performance by it of this Amendment shall not (1) result
in the breach of, or constitute (alone or with notice or with the lapse of
time
or both) a default under, any material agreement or instrument to which it
is a
party, (2) violate (A) any provision of law, statute, rule or regulation, or
organizational documents or other constitutive documents, (B) any order of
any
Governmental Authority or (C) any provision of any material indenture, agreement
or other instrument to which it is a party or by which it or any of its property
is or may be bound, or (3) result in the creation or imposition of any Lien
upon
or with respect to any property or assets now owned or hereafter acquired by
the
Borrower other than pursuant to the Loan Documents, (v) this Amendment and
each
of the Loan Documents to which it is a party or by which it or its assets may
be
or is bound constitutes its legal, valid and binding obligations, enforceable
against it (subject, as to the enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium and similar laws affecting
creditors’ rights generally and to general principles of equity), (vi) except as
publicly disclosed, there are no actions, suits, investigations (civil or
criminal) or proceedings at law or in equity or by or before any Governmental
Authority pending or, to its knowledge, threatened against or affecting it
or
any of its business, property or rights (1) which involve any Loan Documents
or
(2) which would be materially likely to result in a Material Adverse Effect,
(vii) it is not in default or violation with respect to any law, rule or
regulation, judgment, writ, injunction or decree order of any court,
governmental authority, regulatory agency or arbitration board or tribunal
and,
with respect to the Originator, the effect of which would have a material
adverse effect on its business, assets, operations or financial condition and
(viii) no Facility Termination Event, Default or Event of Default has occurred
or is continuing. Except as expressly amended by the terms of this Amendment,
all terms and conditions of the Secured Loan Agreement shall remain in full
force and effect and are hereby ratified in all respects.
Section
3. Conditions
to Effectiveness.
This
Amendment shall not be effective until the following conditions precedent have
been satisfied:
(a) the
Lender shall have received:
| (i) |
a
copy of this Amendment duly executed by each of the parties
hereto;
|
| (ii) |
good
standing certificates, dated as of a recent date, for each of the
Borrower
and the Servicer, issued by the Secretary of State of
Delaware;
|
| (iii) |
certified
copies of requests for information or copies (or similar UCC search
report
certified by a party acceptable to the Lender), dated a date reasonably
near to the effective date hereof, listing all effective financing
statements, which name the Borrower (under its present name and any
previous name) as debtor, together with copies of such financing
statements as the Lender may
request;
|
| (iv) |
one
or more bring down letters with respect to the Opinions of Counsel
of
counsel to the Borrower, the Servicer, the Custodian and the Backup
Servicer, delivered in connection with the Secured Loan Agreement
which
bring down letters shall affirm such Opinions of Counsel as of the
effective date hereof;
|
| (v) |
one
or more Opinions of Counsel of counsel to the Borrower and the Servicer
in
form and substance satisfactory to the Agent with respect to, among
other
things, the due authorization, execution and delivery of, and
enforceability of, this Amendment;
|
| (vi) |
all
costs and expenses required to be paid in connection with this Amendment
shall have been paid in full, and any fees due the Lender payable
in
connection with this Amendment shall have been paid in full;
and
|
| (vii) |
the
Servicer shall have delivered to the Lender, in form and substance
satisfactory to the Lender, a certificate signed by an officer of
the
Borrower having responsibility for financial matters of the Borrower
which
shall demonstrate that, as of the effective date of this Amendment
no
Facility Termination Event or Event of Default shall
exist.
|
(b) All
acts
and conditions (including, without limitation, the obtaining of any necessary
regulatory approvals and the making of any required filings, recordings or
registrations) required to be done and performed and to have happened prior
to
the execution, delivery and performance of this Amendment and all related
documents and to constitute the same legal, valid and binding obligations,
enforceable in accordance with their respective terms, shall have been done
and
performed and shall have happened in due and strict compliance with all
applicable laws.
Section
4. Defined
Terms;
Headings.All
capitalized terms used herein, unless otherwise defined herein, have the same
meanings provided herein or in Appendix
A
to the
Secured Loan Agreement. The
headings of the various Sections of this Amendment have been inserted for
convenience of reference only and shall not be deemed to be part of this
Amendment.
Section
5. Limited
Amendment.
This
Amendment is limited precisely as written and shall not be deemed to (a) be
a
consent to a waiver or any other term or condition of the Secured Loan
Agreement, the other Loan Documents or any of the documents referred to therein
or executed in connection therewith or (b) prejudice any right or rights the
Lender or the Hedge Counterparties may now have or may have in the future under
or in connection with the Secured Loan Agreement, the other Loan Documents
or
any documents referred to therein or executed in connection therewith. Whenever
the Secured Loan Agreement is referred to in the Secured Loan Agreement or
any
of the instruments, agreements or other documents or papers executed and
delivered in connection therewith, it shall be deemed to mean the Secured Loan
Agreement, as the case may be, as modified by this Amendment. Except as hereby
amended, no other term, condition or provision of the Secured Loan Agreement
shall be deemed modified or amended, and this Amendment shall not be considered
a novation.
Section
6. Construction;
Severability.
This
Amendment is a document executed pursuant to the Secured Loan Agreement and
shall (unless otherwise expressly indicated therein) be construed, administered
or applied in accordance with the terms and provisions thereof. If
any
one or more of the covenants, agreements, provisions or terms of this Amendment
shall be held invalid in a jurisdiction for any reason whatsoever, then, in
such
jurisdiction, such covenants, agreements, provisions or terms shall be deemed
severable from the remaining covenants, agreements, provisions or terms of
this
Amendment and shall in no way affect the validity or enforceability of the
other
covenants, agreements, provisions or terms of this Amendment.
Section
7. Counterparts;
Facsimile Signature.
This
Amendment may be executed by the parties hereto in several counterparts, each
of
which shall be deemed to be an original and all of which shall constitute
together but one and the same agreement. The parties may execute facsimile
copies of this Amendment and the facsimile signature of any such party shall
be
deemed an original and fully binding on said party.
Section
8. Governing
Law.
This
Amendment shall be governed and construed in accordance with the applicable
terms and provisions of Section 14.09 (Governing Law) of the Secured Loan
Agreement, which terms and provisions are incorporated herein by
reference.
Section
9. Successors
and Assigns.
This
Amendment shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns.
IN
WITNESS WHEREOF, the parties hereto have caused this Second Amendment to the
Secured Loan Agreement to be duly executed by their respective authorized
officers as of the day and year first written above.
BORROWER: LEAF
FUND II, LLC
By:
_____________________________________
Name:
Xxxxx
Xxxxxx
Title: Vice
President
ORIGINATOR: LEAF
FUNDING, INC.
By:
_____________________________________
Name: Xxxxx
Xxxxxx
Title: SVP
&
COO
By: LEAF
FINANCIAL
CORPORATION,
as
General
Partner
By:
_____________________________________
Name: Xxxxx
Xxxxxx
Title: President,
COO
SERVICER:
LEAF
FINANCIAL
CORPORATION
By:
____________________________________
Name: Xxxxx
Xxxxxx
Title: President,
COO
Second
Amendment to Secured Loan Agreement
LENDER:
WESTLB
AG, NEW YORK BRANCH
By:
____________________________________
Name:
Title:
By:
____________________________________
Name:
Title:
COLLATERAL
AGENT/
SECURITIES
INTERMEDIARY: U.S.
BANK NATIONAL ASSOCIATION
By:
___________________________________
Name:
Title:
