FOURTH AMENDMENT TO LOAN AGREEMENT
This FOURTH AMENDMENT TO LOAN AGREEMENT (this "Fourth Amendment") is
made as of the 31st day of July, 2006, by and between UNITED MORTGAGE TRUST, a
Maryland real estate investment trust ("Borrower") and TEXAS CAPITAL BANK,
NATIONAL ASSOCIATION, a national banking association ("Lender").
RECITALS
A. Borrower and Lender entered into that certain Loan Agreement dated
as of November 8, 2004, as amended by (i) the First Amendment to Loan Agreement
dated as of December 27, 2005, (ii) the Second Amendment to Loan Agreement
dated as of April 20, 2006, and (iii) the Third Amendment to Loan Agreement
dated as of June 16, 2006 (said loan agreement as so amended is herein called
the "Loan Agreement").
B. Borrower has requested Lender to increase the amount of the
Commitment and the amount of the Letter of Credit Liabilities, and Lender,
has agreed to the same upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises herein contained and
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties, intending to be legally bound, hereby
agree as follows:
ARTICLE I
Definitions
Section 1.01. Definitions. Capitalized terms used in this Fourth
Amendment, to the extent not otherwise defined herein, shall have the same
meaning as assigned to them in the Loan Agreement, as amended hereby.
ARTICLE II
Amendments
Section 2.01. Amendments to Section 1.1.
(a) The definition of "Commitment" in Section 1.1 of the Loan
Agreement is amended in its entirety to hereafter read as follows:
"'Commitment' means the obligation of the Lender to make Revolving
Credit Advances pursuant to Section 2.1 in an aggregate principal
amount at any time outstanding up to but not exceeding Thirty Million
and No/100 Dollars ($30,000,000.00), subject, however, to termination
pursuant to Section 10.2."
(b) The definition of "Revolving Credit Note" in Section 1.1 of
the Loan Agreement is amended in its entirety to hereafter read as follows:
"'Revolving Credit Note' means the promissory note of Borrower
payable to the order of Lender, in substantially the form of Exhibit A
attached to this Fourth Amendment, and all amendments, extensions,
renewals, replacements, and modifications thereof."
(c) The term "Fourth Amendment" and its definition are added to
Section 1.1 of the Loan Agreement and shall read as follows:
'"Fourth Amendment' means the Fourth Amendment to Loan
Agreement dated as of July 31, 2006, between Borrower and Lender."
Section 2.02. Amendment to Section 2.5. Section 2.5 of the Loan
Agreement is amended in its entirety to hereafter read as follows:
"Section 2.5 Letters of Credit. Subject to the terms and conditions
of this Agreement, Lender agrees to issue one or more Letters of Credit
for the account of Borrower from time to time from the date hereof to
and including the Termination Date; provided, however, that the
outstanding Letter of Credit Liabilities shall not at any time exceed the
lesser of (a) Five Million and No/100 ($5,000,000.00), (b) an amount
equal to the amount of the Commitment minus the outstanding
Advances, or (c) the Borrowing Base minus the outstanding Revolving
Credit Advances. Each Letter of Credit shall not have an expiration date
beyond the Termination Date, shall be payable in Dollars, shall have a
minimum face amount of $50,000, must support a transaction that is
entered into in the ordinary course of Borrower's business, must be
satisfactory in form and substance to Lender, will be subject to the
payment of such Letter of Credit fees as Lender may require, including,
without limitation, an issuance fee of 1% per annum of the face amount
of each Letter of Credit, and shall be issued pursuant to such documents
and instruments executed by Borrower (including, without limitation, a
Letter of Credit Application as then in effect) as Lender may require.
Each payment by Lender pursuant to a drawing under a Letter of Credit
is due and payable ON DEMAND, and at the sole option of Lender, can
be charged by Lender as (and will be deemed to be) a Revolving Credit
Advance by Lender to Borrower under the Note and this Agreement as of
the day and time such payment is made by Lender and in the amount of
such payment."
ARTICLE III
Conditions Precedent
Section 3.01. Conditions. The effectiveness of this Fourth Amendment
and the agreement by Lender to disburse any Advances under the Notes are each
subject to the satisfaction of the following conditions precedent, unless
specifically waived by Lender:
(a) The following instruments shall have been duly and validly executed
and delivered by the parties thereto, all in form, scope and content
satisfactory to Lender:
(i) this Fourth Amendment;
(ii) the Revolving Credit Note, being that certain promissory note dated
of even date herewith in stated principal amount of $30,000,000.00 executed
by Borrower and payable to the order of Lender;
(iii) an Amended and Restated Guaranty Agreement executed by Xxxx Xxxxx
in favor of Lender; and
(iv) Resolutions of the Board of Directors (or other governing body) of
Borrower certified by the Secretary or an Assistant Secretary (or other
custodian of records of Borrower) which authorize the execution, delivery,
and performance by Borrower of this Fourth Amendment, the Revolving Credit
Note and the other Loan Documents; and
(b) Lender shall have received from Borrower each of the following:
(i) a fee in the amount of $33,333.33, which fee is fully earned on the
date hereof by Lender and nonrefundable;
(ii) all reasonable costs and expenses incurred by Lender on or before
the date hereof; and
(iii) such other documents as Lender shall from time to time reasonably
request.
(c) The representations and warranties contained herein, in the Loan
Agreement, as amended hereby, and/or in each other Loan Document shall be true
and correct as of the date hereof, as if made on the date hereof, except to the
extent such representation and warranties relate to an earlier date.
(d) No Event of Default shall have occurred and be continuing and no
Default shall exist, unless such Event of Default or Default has been
specifically waived in writing by Bank.
(e) All corporate proceedings taken in connection with the transactions
contemplated by this Fourth Amendment and all documents, instruments and other
legal matters incident thereto, shall be satisfactory to Lender and its legal
counsel.
ARTICLE IV
Ratifications, Representations, Warranties
Section 4.01. Ratification by Borrower. Except as expressly modified
and superseded by this Fourth Amendment, the terms and provisions of the Loan
Agreement are ratified and confirmed and continue in full force and effect.
The Loan Agreement as amended by this Fourth Amendment and the other Loan
Documents continue to be legal, valid, binding and enforceable in accordance
with their respective terms.
Section 4.02. Renewal and Extension of Security Interests and Liens.
Borrower hereby renews and affirms the liens and security interests created
and granted in Loan Documents. Borrower agrees that this Fourth Amendment
shall in no manner affect or impair the liens and security interests securing
the Obligations, and that such liens and security interests shall not in any
manner be waived, the purposes of this Fourth Amendment being to modify the
Loan Agreement as herein provided, and to carry forward all liens and security
interest securing same, which are acknowledged by Borrower to be valid
and subsisting.
Section 4.03. Representations and Warranties. Borrower represents
and warrants to Lender as follows: (i) the execution, delivery and performance
of this Fourth Amendment and any and all Loan Documents executed and/or
delivered in connection herewith have been authorized by all requisite action
on the part of Borrower and will not violate any of the organizational
documents of Borrower or any agreement to which Borrower is a party; (ii) the
representations and warranties contained in the Loan Agreement as amended
hereby and in each of the other Loan Documents are true and correct on and as
of the date hereof as though made on and as of the date hereof; (iii) no Event
of Default under the Loan Agreement has occurred and is continuing; and (iv)
Borrower is in full compliance with all covenants and agreements contained in
the Loan Agreement, as amended hereby and in all other Loan Documents.
ARTICLE V
Miscellaneous
Section 5.01. Survival of Representations and Warranties. All
representations and warranties made in the Loan Agreement or any other Loan
Document, including without limitation, any Loan Document furnished in
connection with this Fourth Amendment, shall survive the execution and delivery
of this Fourth Amendment and the other Loan Documents, and no investigation by
Lender or any closing shall affect such representations and warranties or the
right of Lender to rely thereon.
Section 5.02. Reference to Loan Agreement. Each of the Loan Documents
and the Loan Agreement and any and all other agreements, documents or
instruments now or hereafter executed and delivered pursuant to the terms
hereof or pursuant to the terms of the Loan Agreement, as amended, are
hereby amended so that any reference in such Loan Documents to the Loan
Agreement shall mean a reference to the Loan Agreement as amended.
Section 5.03. Expenses of Lender. Borrower agrees to pay on demand
all reasonable costs and expenses incurred by Lender directly in connection
with the preparation, negotiation and execution of this Fourth Amendment and
the other Loan Documents executed pursuant hereto and any and all amendments,
modifications, and supplements thereto, including, without limitation, the
costs and fees of Lender's legal counsel, and all costs and expenses incurred
by Lender in connection with the enforcement or preservation of any rights
under the Loan Agreement, as amended hereby, or any other Loan Document,
including, without limitation, the reasonable costs and fees of Lender's
legal counsel.
Section 5.04. Severability. Any provision of this Fourth Amendment
held by a court of competent jurisdiction to be invalid or unenforceable shall
not impair or invalidate the remainder of this Fourth Amendment and the effect
thereof shall be confined to the provision so held to be invalid or
unenforceable.
Section 5.05. Applicable Law. THIS FOURTH AMENDMENT SHALL BE DEEMED
TO HAVE BEEN MADE AND TO BE PERFORMABLE IN AND SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
Section 5.06. Successors and Assigns. This Fourth Amendment is
binding upon and shall inure to the benefit of the parties hereto and their
respective successors, assigns, heirs, executors, and legal representatives,
except that none of the parties hereto other than Lender may assign or transfer
any of its rights or obligations hereunder without the prior written consent
of Lender.
Section 5.07. Counterparts. This Fourth Amendment may be executed
in one or more counterparts, each of which when so executed shall be deemed to
be an original, but all of which when taken together shall constitute one and
the same instrument. Delivery of an executed counterpart of this Fourth
Amendment by facsimile shall be equally as effective as delivery of an executed
original counterpart and shall constitute a covenant to deliver an executed
original counterpart, but the failure to do so shall not affect the validity,
enforceability and binding effect of this Agreement. The foregoing
shall apply to each other Loan Document mutatis mutandis.
Section 5.08. Effect of Waiver. No consent or waiver, express or
implied, by Lender to or for any breach of or deviation from any covenant,
condition or duty by Borrower, shall be deemed a consent to or waiver of any
other breach of the same or any other covenant, condition or duty.
Section 5.09. Headings. The headings, captions, and arrangements used
in this Fourth Amendment are for convenience only and shall not affect the
interpretation of this Fourth Amendment.
Section 5.10. Conflicting Provisions. If any provision of the Loan
Agreement as amended hereby conflicts with any provision of any other Loan
Document, the provision in the Loan Agreement shall control.
Section 5.11. Release. EACH OF THE BORROWER AND GUARANTOR HEREBY
VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES LENDER, ITS
AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM ALL POSSIBLE CLAIMS,
DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND
LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR UNANTICIPATED,
SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN
EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS FOURTH
AMENDMENT IS EXECUTED, WHICH BORROWER OR ANY GUARANTOR MAY NOW OR
HEREAFTER HAVE AGAINST LENDER, ITS AGENTS, EMPLOYEES, SUCCESSORS AND
ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF (1)
CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, (II) ANY
LOAN, (III) ANY ACTION OR INACTION ON THE PART OF LENDER WITH RESPECT TO THE
LOANS, (IV) ANY CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR
RECEIVING INTEREST IN EXCESS OF THE HIGHEST LAWFUL RATE, (V) THE EXERCISE OF
ANY RIGHTS AND REMEDIES UNDER THIS FOURTH AMENDMENT, THE LOAN
AGREEMENT OR THE OTHER LOAN DOCUMENTS, OR (VI) THE NEGOTIATION, EXECUTION
OR DELIVERY OF THIS FOURTH AMENDMENT, THE LOAN AGREEMENT OR ANY OTHER
LOAN DOCUMENTS.
Section 5.12. Entire Agreement. THIS FOURTH AMENDMENT, THE LOAN
AGREEMENT AND ALL OTHER LOAN DOCUMENTS EXECUTED AND DELIVERED IN
CONNECTION WITH AND PURSUANT TO THIS AMENDMENT AND THE LOAN
AGREEMENT 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.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
EXECUTED as of the date first written above.
BORROWER:
UNITED MORTGAGE TRUST,
a Maryland real estate investment trust
By:_______________________________
Xxxxxxxxx Xxxxxxx
President
LENDER:
TEXAS CAPITAL BANK, NATIONAL
ASSOCIATION
By:_______________________________
Xxxx Xxxxxx
Executive Vice President
EXHIBIT A
REVOLVING CREDIT NOTE
[see attached]
FOURTH AMENDMENT TO LOAN AGREEMENT - PAGE 2
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FOURTH AMENDMENT TO LOAN AGREEMENT - SIGNATURE PAGE
DALLAS 1154935_1 4807.32
FOURTH AMENDMENT TO LOAN AGREEMENT - EXHIBIT A
DALLAS 1154935_1 4807.32
