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EXHIBIT 10.103
MASTER ASSIGNMENT AGREEMENT
BETWEEN
ONYX ACCEPTANCE FUNDING CORPORATION
AND
XXXXXXX XXXXX MORTGAGE CAPITAL INC.
DATED AS OF FEBRUARY 4, 1998
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TABLE OF CONTENTS
PAGE
SECTION 1. DEFINITIONS; CONSTRUCTION....................................................... 1
(a) Definitions........................................................ 1
(b) Accounting Terms and Determinations................................ 5
(c) Other Definitional Terms........................................... 5
SECTION 2. GRANT OF SECURITY INTEREST; DELIVERY OF
COLLATERAL; LOANS DISCRETIONARY.................................... 6
(a) Grant of Security Interest......................................... 6
(b) Delivery of Instruments of Transfer................................ 6
(c) Funding of Loans................................................... 6
SECTION 3. EARNINGS ON COLLATERAL.......................................................... 7
SECTION 4. CONFIRMATION STATEMENT.......................................................... 8
SECTION 5. MARGIN DETERMINATIONS........................................................... 8
(a) Margin Requirement................................................. 8
(b) Current Margin..................................................... 8
(c) Supplemental Collateral............................................ 8
(d) Release of Supplemental Collateral................................. 8
SECTION 6. RELEASE AND SUBSTITUTION OF COLLATERAL.......................................... 9
SECTION 7. CONDITIONS TO THE LOANS......................................................... 9
(a) Conditions to the Effective Date................................... 9
(b) Conditions Precedent to all Loans and Substitutions................ 10
SECTION 8. REPRESENTATIONS AND WARRANTIES.................................................. 12
(a) Due Incorporation.................................................. 12
(b) Authorization...................................................... 12
(c) No Conflict........................................................ 12
(d) Approvals, etc..................................................... 12
(e) Good Title......................................................... 13
(f) Tax Liens.......................................................... 13
(g) Financial Statements............................................... 13
(h) No Litigation...................................................... 13
(i) Disclosure......................................................... 13
(j) Permits, Licenses, Approvals, Consents, etc........................ 14
(k) The Investment Company Act......................................... 14
(l) Ownership of Assignor.............................................. 14
SECTION 9. AFFIRMATIVE COVENANTS........................................................... 14
(a) Financial Statements and Other Information......................... 14
(b) Existence, Conduct of Business, etc................................ 15
(c) Taxes.............................................................. 15
(d) Laws............................................................... 15
(e) Name and Locations................................................. 15
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(f) Records............................................................ 16
(g) Pay Obligations.................................................... 16
(h) Notices............................................................ 16
SECTION 10. NEGATIVE COVENANTS........................................................ 16
(a) Liens.............................................................. 16
(b) Mergers, Sales, Dissolution, etc................................... 17
(c) Corporate Changes.................................................. 17
(d) Use of Proceeds.................................................... 17
(e) Further Covenants.................................................. 17
SECTION 11. EVENTS OF DEFAULT......................................................... 17
(a) Nonperformance..................................................... 17
(b) Termination of Interest............................................ 18
(c) Act of Insolvency.................................................. 18
(d) Material Adverse Change............................................ 18
(e) Default Under Other Contracts...................................... 18
(f) Merger or Consolidation............................................ 18
(g) Anticipated Insolvency............................................. 18
(h) Final Judgment..................................................... 18
(i) Breach of Credit Covenants......................................... 18
(j) Breach of Representation........................................... 19
(k) Breach of Covenant................................................. 19
SECTION 12. REMEDIES.................................................................. 19
(a) Action Regarding Collateral........................................ 19
(b) Deficiency......................................................... 20
(c) Private Sale....................................................... 20
(d) Application of Proceeds............................................ 20
(e) Default Rate of Interest........................................... 21
(f) Attorney-in-Fact................................................... 21
(g) Payments on Collateral to Assignor................................. 21
(h) Cross-Collateralization; Right of Set-Off.......................... 21
SECTION 13. MATURITY DATE; INTEREST PAYMENT DATES;
REPAYMENT OF PRINCIPAL............................................. 22
(a) Payment on Maturity Date........................................... 22
(b) Interest Payment................................................... 22
(c) Payment of Principal............................................... 22
(d) Event of Default................................................... 22
SECTION 14. PAYMENT OF TAX LIABILITY.................................................. 22
SECTION 15. GENERAL PROVISIONS........................................................ 22
(a) No Waiver.......................................................... 22
(b) Governing Law; Severability........................................ 23
(c) Construction....................................................... 23
(d) Assignment......................................................... 23
(e) Notices, Payments, Deliveries...................................... 23
(f) Termination........................................................ 24
(g) Aggregate Amount of Loans; Disbursement of Funds................... 24
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(h) Expenses........................................................... 25
(i) MLMCI's Right to Pledge............................................ 25
(j) Indemnification.................................................... 25
(k) Further Assurances................................................. 25
(l) Remedies Cumulative................................................ 26
(m) Litigation......................................................... 26
EXHIBIT A A-1
LOAN SCHEDULE..............................................................................A-4
EXHIBIT B X-0
XXXXXXX X X-0
XXXXXXX X X-0
EXHIBIT E E-1
EXHIBIT F F-1
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THIS AGREEMENT is made as of the 4th day of February, 1998 by and
between ONYX ACCEPTANCE FUNDING CORPORATION ("Assignor") and XXXXXXX XXXXX
MORTGAGE CAPITAL INC. ("MLMCI"). By executing this Agreement, Assignor and MLMCI
agree to be bound by the terms of this Agreement.
WITNESSETH
WHEREAS the parties elect to enter into this Agreement and, at the
request of Assignor, MLMCI may from time to time at its option agree to make one
or more loans (in each instance, a "Loan") to Assignor, which Loans shall be
limited in aggregate outstanding principal amount to the Maximum Advance Amount,
said Loans to be evidenced by Assignor's Note (the "Note") of even date
herewith, maturing on the Maturity Date (as defined herein), a form of which is
attached hereto as Exhibit A; and
WHEREAS, in order to induce MLMCI to make Loans from time to time to
it, Assignor has agreed to assign and pledge to MLMCI and grant to MLMCI a lien
upon and a security interest in the Collateral (as hereinafter defined) for the
purpose of securing its obligations under the Note;
NOW, THEREFORE, in consideration of the foregoing and of the
covenants and agreements hereinafter set forth, Assignor and MLMCI agree as
follows:
DEFINITIONS; CONSTRUCTION
Definitions. As used herein, the following terms shall have the
meaning herein specified (to be equally applicable to be the singular and plural
forms of the terms defined):
"ABS Issuance Agreements" shall mean the agreements pursuant to which
the related Pledged ABS has been issued, including any agreements relating to
the payment or distribution of amounts to the holder of such Pledged ABS, which
agreements have been previously approved by MLMCI or its affiliate.
"Act of Insolvency" shall have the meaning ascribed to it in Section
11(c) hereof.
"Agreement" shall mean this Master Assignment Agreement, as amended,
supplemented or otherwise modified from time to time in accordance with its
terms.
"Approvals" shall have the meaning set forth in Section 8(d) hereof.
"Assignor" shall have the meaning set forth in the preamble hereof.
"Book Net Worth" shall refer to the equity of Assignor determined in
accordance with GAAP.
"Business Day" shall mean any day excluding Saturday, Sunday, or any
other day on which banks in New York, New York or California are authorized or
required by law to close or a day on which trading by and between banks in
Dollars in the London interbank market is not conducted.
"Closing Date" shall mean with respect to each Loan, the settlement date
set forth in the Confirmation Statement applicable to such Loan.
"Collateral" shall have the meaning ascribed thereto in Section 2 hereof
and shall include any Supplemental Collateral.
"Confirmation Statement" shall have the meaning set forth in Section 4
hereof.
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"Covenant Compliance Certificate" shall refer to a certificate of
Assignor and Onyx to the effect that there has not occurred any of the events
listed in Section 11(i) as of the date of such certificate.
"Current Margin" shall have the meaning ascribed to it in Section 5(b)
hereof.
"Default" shall mean any condition, act or event which, with notice or
lapse of time or both, would constitute an Event of Default.
"Default Rate" shall have the meaning specified in Section 12(e) hereof.
"Dollar" and the sign "$" shall mean lawful money of the United States
of America.
"Effective Date" shall mean the date that all of the conditions set
forth in Section 7 hereof have been met.
"Event of Default" shall have the meaning set forth in Section 11
hereof.
"GAAP" shall have the meaning specified in Section 1(b) hereof.
"Governmental Authority" shall mean any nation, government, or State, or
any political subdivision of any of them, or any court, entity or agency
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Guaranty" shall mean the guaranty of Onyx substantially in the form set
forth at Exhibit E hereto.
"Indebtedness" shall mean, for any Person: (a) obligations created,
issued or incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of property to another Person
subject to an understanding or agreement, contingent or otherwise, to repurchase
such property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of property or services, other than trade
accounts payable (other than for borrowed money) arising, and accrued expenses
incurred, in the ordinary course of business so long as such trade accounts
payable are payable within 90 days of the date the respective goods are
delivered or the respective services are rendered; (c) Indebtedness of others
secured by a lien on the property of such Person, whether or not the respective
Indebtedness so secured has been assumed by such Person; (d) obligations
(contingent or otherwise) of such Person in respect of letters of credit or
similar instruments issued or accepted by banks and other financial institutions
for account of such Person; (e) capital lease obligations of such Person; (f)
obligations of such Person under repurchase agreements or like arrangements; (g)
Indebtedness of others guaranteed by such Person; (h) all obligations of such
Person incurred in connection with the acquisition or carrying of fixed assets
by such Person; and (i) Indebtedness of general partnerships of which such
Person is a general partner.
"Lien" shall mean any interest in property, or a claim by, a Person
other than the owner of such property, whether such interest is based on the
common law, statute or contract, and including, but not limited to, a security
interest, security title or lien arising from a security agreement, mortgage,
deed of trust, deed to secure debt, encumbrance, pledge, conditional sale,
financing statement or trust receipt or a lease, consignment or bailment for
security purposes.
"Loan" shall have the meaning set forth in the preamble hereof.
"Loan Documents" shall mean and include this Agreement, the Note, each
Confirmation Statement, the Guaranty, when delivered, and all instruments and
documents now or hereafter executed and/or delivered pursuant hereto or thereto
or in connection herewith or therewith.
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"Margin Requirement" shall have the meaning set forth in Section 5(a)
hereof.
"Margin Stock" shall have the meaning provided in Regulation G of the
Board of Governors of the Federal Reserve System.
"Market Value" shall mean the fair market value of any Pledged ABS (to
the date that it is first eligible to be redeemed) as determined in accordance
with MLMCI's valuation model for such type of Pledged ABS, which valuation model
shall take into account, among other variables deemed appropriate by MLMCI from
time to time, the appropriate prevailing discount rate, current market loss rate
assumptions and current market prepayment speeds; provided, however, that such
fair market value or valuation model may be modified by MLMCI in its discretion
using reasonable business judgment and taking into consideration relevant market
conditions at the time of such determination. The pricing assumptions used by
MLMCI in determining the fair market value of any Pledged ABS will be set forth
in the related Confirmation Statement.
"Master Repurchase Agreement" shall mean the Master Repurchase
Agreement, dated as of February 4, 1998, between MLMCI and Assignor, as the same
shall be amended from time to time.
"Material Adverse Change" shall mean, with respect to Assignor or Onyx,
as applicable, a material adverse change in (a) the business, operations,
properties, prospects or condition (financial or otherwise) of such Person or
(b) the ability of such Person to perform its obligations hereunder and under
the other Loan Documents.
"Maturity Date" shall mean with respect to each Loan the earlier of (a)
one year from the related Closing Date as specified in the Confirmation
Statement with respect to such Loan, subject to extension under Section 13(b),
and (b) the Termination Date.
"Maximum Advance Amount" shall mean, as of any date of determination,
the lesser of (i) $50,000,000 and (ii) 33% of the average aggregate amount of
advances outstanding under the Master Repurchase Agreement during each calendar
quarter; provided, however, that the first $10,000,000 of the Maximum Advance
Amount shall not be subject to the restriction in clause (ii) above from the
Effective Date until March 31, 1998.
"MLMCI" shall have the meaning set forth in the preamble hereof.
"Net Worth" shall refer to the sum of equity and subordinated debt of
Onyx determined in accordance with GAAP less the sum of (i) intercompany
receivables, (ii) loans to officers or employees of Onyx, (iii) goodwill and
(iv) deferred taxes, in every case determined on a consolidated basis.
"Note" shall have the meaning set forth in the preamble hereof.
"Obligations" shall mean the principal of and all interest on the Loans,
all fees, expenses, reimbursements (including, without limitation the reasonable
fees and expenses of attorneys), taxes and indemnities and other amounts payable
by the Assignor under the Loan Documents and under any other documents or
instruments executed and delivered by Assignor in connection therewith to MLMCI
pursuant to Section 2 hereof or any of their respective successors or assigns,
direct or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising and however arising.
"Onyx" shall mean Onyx Acceptance Corporation, the direct or indirect
sole shareholder of Assignor.
"Outstanding Loans" shall mean on the date of determination thereof the
aggregate unpaid principal amount of each Loan made hereunder.
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"Person" shall mean any individual, corporation, company, voluntary
association, partnership, joint venture, limited liability company, trust,
unincorporated association or government (or any agency, instrumentality or
political subdivision thereof).
"Pledged ABS" shall mean any residual, subordinated or interest strip
class of asset backed securities (i) issued in connection with a securitization
involving Assignor, Onyx or an affiliate of either of them, and in which MLMCI
or an affiliate of MLMCI has acted as the lead or co-lead underwriter or
placement agent and (ii) pledged by Assignor hereunder and accepted by MLMCI in
connection with a Loan hereunder.
"Prime Rate" shall mean the prime rate of U.S. commercial banks as
published in The Wall Street Journal (or, if more than one such rate is
published, the average of such rates).
"Proceeds" shall have the meaning assigned to it under the UCC and, in
any event, shall include, but not be limited to, (i) any and all Proceeds of any
insurance, indemnity, warranty or guaranty payable to the Assignor from time to
time with respect to any of the Collateral, (ii) any and all payments (in any
form whatsoever) made or due and payable to Assignor from time to time in
connection with any reacquisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any Governmental Authority
and any sale, transfer or other disposition of all or any part of the
Collateral, and (iv) any and all other amounts from time to time paid or payable
under or in connection with any of the Collateral.
"Substitute Collateral" shall have the meaning set forth in Section 6
hereof.
"Supplemental Collateral" shall mean collateral acceptable to MLMCI in
accordance with the provisions of Section 5(c) hereof.
"Termination Date" shall have the meaning ascribed to it in Section
15(f) hereof.
"UCC" shall mean the Uniform Commercial Code in effect from time to time
in the applicable jurisdiction.
Accounting Terms and Determinations. Unless otherwise defined or
specified herein, all accounting terms shall be construed herein, all accounting
determinations hereunder shall be made, all financial statements required to be
delivered hereunder shall be prepared and all financial records shall be
maintained in accordance with generally accepted accounting principles ("GAAP")
applied on a basis consistent with the financial statements referred to in
Sections 9(a)(i) and 9(a)(ii) hereof.
Other Definitional Terms. The words "hereof", "herein" and
"hereunder" and words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement, and article, section, schedule, exhibit and like references are to
this Agreement unless otherwise specified. Any defined term which relates to a
document shall include within its definition any amendments, modifications,
renewals, restatements, extensions, supplements or substitutions which may have
been heretofore or may be hereafter executed in accordance with the terms
hereof.
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GRANT OF SECURITY INTEREST; DELIVERY OF
COLLATERAL; LOANS DISCRETIONARY
Grant of Security Interest. Assignor hereby grants, pledges,
assigns, transfers and delivers to MLMCI with respect to each Loan on the
Closing Date, and grants to MLMCI a lien upon and continuing security interest
in all of Assignor's right, title and interest in, to and under all of the
following whether now owned or existing, or at any time hereafter acquired or
arising, by Assignor or in which Assignor now has or at any time in the future
may acquire any right, title or interest (all of which being hereinafter
collectively called the "Collateral"): (i) the Pledged ABS described in the
Confirmation Statement delivered pursuant to Section 4 relating to a Loan, (ii)
any Supplemental Collateral that may be granted to MLMCI pursuant to Section
5(c) hereof (provided, however, that any representations, warranties or
covenants contained herein, and the grant of a lien and security interest with
respect to any Supplemental Collateral, shall be effective as to any
Supplemental Collateral (or any Proceeds, distributions or other amounts
realized in respect of such Supplemental Collateral) only upon the delivery of
such Supplemental Collateral to MLMCI pursuant to such Section 5(c) hereof),
(iii) all Proceeds, distributions and other amounts realized in respect of any
of the foregoing, as security for the due and punctual payment by Assignor of
the Note and any amounts that may become payable thereunder or hereunder and
(iv) with respect to any Loan, all books and records of Assignor pertaining to
any of the foregoing.
Delivery of Instruments of Transfer. Assignor shall, with respect to
each Loan, deliver to MLMCI the Collateral endorsed in the name of MLMCI or its
nominee or with properly endorsed instruments of transfer (including, without
limitation, any necessary assignments, corporate resolutions and opinions of
legal counsel) that will enable MLMCI to cause such Collateral to be so
registered without further action on the part of the Assignor and such
instruments of transfer to the appropriate transfer agent.
Funding of Loans. (i) MLMCI Discretion. MLMCI shall not be required
to make any Loans hereunder and any Loan hereunder shall be made by MLMCI in its
sole discretion upon written request delivered by Assignor to MLMCI not less
than one (1) Business Day prior to the applicable Closing Date.
Loan Advances. If MLMCI determines to make any Loan hereunder,
then in accordance with the related Confirmation Statement, MLMCI shall advance
such Loan to Assignor at a principal amount, described in such Confirmation
Statement, up to a maximum of 70% of the Market Value of the Collateral until
the Guaranty is delivered and 75% of the Market Value of the Collateral
thereafter. Each Loan advance hereunder shall be recorded as such by MLMCI and
be evidenced by the "Loan Schedule" attached to the Note, and any repayments of
each such Loan shall be recorded as such by MLMCI and be evidenced by such "Loan
Schedule"; provided, however, that the failure of such recordation by MLMCI
shall not affect the rights of the parties hereunder with respect to such Loan.
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Interest Rate. Each Loan shall bear interest, as calculated on a
monthly basis from and including the related Closing Date to but excluding the
date such Loan is paid in full, on the unpaid principal amount thereof from the
related Closing Date through maturity at a rate per annum equal to (a)
seventy-five (75) basis points in excess of the Prime Rate (determined daily)
with respect to Loans for which the provision of clause (ii) of the definition
of Maximum Advance Amount is not satisfied and (b) in all other cases, two
hundred and fifty (250) basis points over the prevailing London Interbank
Offered Rate for one-month United States Dollar deposits as set forth on page
8695 of Telerate as of 8:00 a.m. New York City time on the last Business Day of
the month preceding the month in which such interest is currently accruing.
MLMCI's Duty of Care. Except as herein provided in this Section
2(d), MLMCI's sole duty with respect to the Collateral shall be to use
reasonable care in the safekeeping, custody, use, operation and preservation of
the Collateral in its possession or control. MLMCI shall incur no liability to
Assignor for any act of government, act of God, or other destruction in whole or
in part or negligence or wrongful act of custodians or agents selected by and
supervised by MLMCI with reasonable care, or MLMCI's failure to provide adequate
protection or insurance for the Collateral. MLMCI shall have no obligation to
take any action to preserve any rights in any of the Collateral against prior
parties, and Assignor hereby agrees to take such action. Assignor shall defend
the Collateral against all such claims and demands of all persons, at all times,
as are adverse to MLMCI. MLMCI shall have no obligation to realize upon any
Collateral, except through proper application of any distributions with respect
to the Collateral made directly to MLMCI or its agent(s). So long as MLMCI shall
act in a commercially reasonable manner, Assignor hereby waives the defense of
impairment of the Collateral.
EARNINGS ON COLLATERAL
All payments and distributions, whether in cash or in kind, made on or
with respect to the Collateral shall, so long as an Event of Default as defined
in Section 11 hereof shall not have occurred and be continuing, be paid to the
registered holder thereof directly by the applicable paying agent, and upon
receipt by such holder such payments and distributions shall be released from
the lien and security interest granted to MLMCI hereunder. Subject to compliance
with the ABS Issuance Agreements, MLMCI may, in its sole discretion after the
occurrence and during the continuation of an Event of Default, cause all such
payments and distributions to be paid, delivered or transferred directly to
MLMCI.
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CONFIRMATION STATEMENT
MLMCI shall, with respect to each Loan, deliver a confirmation statement
substantially in the form attached hereto as Exhibit B (in each case, the
"Confirmation Statement") to Assignor confirming the agreement between Assignor
and MLMCI as to the specific terms of the Loan. Each such Confirmation Statement
shall constitute a binding agreement between Assignor and MLMCI, and this
Agreement is hereby incorporated in each such Confirmation Statement and made a
part thereof as if it were set out in full in each such Confirmation Statement.
Each such Confirmation Statement will be binding upon the parties hereto unless
written notice of objection is given by the objecting party to the other party
within two (2) Business Days after the objecting party's receipt of such
Confirmation Statement.
MARGIN DETERMINATIONS
Margin Requirement. A margin requirement (the "Margin Requirement")
expressed as a percentage shall be established by MLMCI with respect to each
Loan on the related Closing Date and shall be set forth in the related
Confirmation Statement. The Margin Requirement for any Loan shall be 30% until
the Guaranty is delivered and 25% thereafter.
Current Margin. MLMCI may, in its reasonable discretion, from time
to time calculate the Current Margin with respect to any Loan, which shall equal
the amount by which (i) 100% exceeds (ii) a fraction (expressed as a percentage)
(A) the numerator of which is the then outstanding principal amount of such Loan
together with accrued and unpaid interest thereon to the date of determination
and (B) the denominator of which shall be the then current Market Value of the
related Collateral (including any Supplemental Collateral delivered pursuant to
this Agreement) then held by MLMCI.
Supplemental Collateral. If MLMCI shall at any time determine with
respect to a Loan that the Current Margin is less than the related Margin
Requirement, MLMCI may in its discretion notify Assignor of such fact, and
Assignor shall, on the day of such notice, if such notice is received prior to
10:00 a.m. New York City time, and on the Business Day next succeeding the day
of such notice, if such notice is received after 10:00 a.m. New York City time,
deliver to MLMCI cash or Supplemental Collateral acceptable to MLMCI in its sole
reasonable judgment as Collateral hereunder, which cash shall be applied to
reduce the principal balance of the related Loan and which Supplemental
Collateral shall, in the aggregate, equal an amount such that, after giving
effect to the application of such cash and the delivery of such Supplemental
Collateral, the Current Margin for such Loan will be at least equal to the
related Margin Requirement. Delivery of Supplemental Collateral pursuant to this
Section 5(c) shall be in such manner as is acceptable to, and under such
additional conditions as may be required by, MLMCI in its sole reasonable
judgment.
Release of Supplemental Collateral. If at any time the Current
Margin for a Loan exceeds the Margin Requirement for such Loan and provided that
Assignor shall not have failed to satisfy the requirements of Section 5(c) with
respect to any notice thereunder given by MLMCI relating to any Loan, Assignor
may, upon notice to MLMCI, demand that MLMCI
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redeliver all or any portion of the Supplemental Collateral, provided, however,
that after giving effect to such redelivery, the Current Margin would not be
less than the Margin Requirement, and MLMCI shall make good delivery of such
Supplemental Collateral, in a manner equivalent to the manner in which such
Supplemental Collateral was delivered to MLMCI, no later than the Business Day
following receipt by MLMCI of such notice. In such connection, MLMCI shall
execute such other documents and take such other actions as the Assignor may
reasonably request in order to evidence and give effect to the release of such
Supplemental Collateral from the security interest granted by this Agreement.
RELEASE AND SUBSTITUTION OF COLLATERAL
Assignor may obtain the release from MLMCI of the security interest in
and lien on all or any part of the Collateral at any time, and from time to
time, by paying to MLMCI as a repayment the amount of the Loan outstanding with
respect to such Collateral to be so released and MLMCI shall effect such release
upon such repayment; provided, however, that the date of any such repayment must
be acceptable to MLMCI. Any release of the security interest in and lien on all
or any part of the Collateral as a result of a repayment or a substitution
pursuant to this Section shall be evidenced by the execution and delivery by
MLMCI of appropriate documentation to evidence such release.
MLMCI shall allow Assignor, in Assignor's sole discretion, to provide
collateral acceptable to MLMCI, in MLMCI's sole reasonable discretion, to be
substituted for existing Collateral of equal or greater market value. All
certificates or instruments representing such substituted collateral shall be
accompanied by duly executed instruments of transfer or assignments in blank,
all in form and substance reasonably satisfactory to MLMCI.
CONDITIONS TO THE LOANS
Conditions to the Effective Date. The obligation of MLMCI to enter
into this Agreement is subject to the satisfaction by Assignor of the following
conditions on the Effective Date:
Loan Documents. MLMCI shall have received the following documents
each in form and substance satisfactory to MLMCI and its counsel:
this Agreement, executed and delivered on behalf of Assignor by
a duly authorized officer of Assignor,
the Note, executed and delivered on behalf of Assignor by a duly
authorized officer of Assignor,
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the related Collateral, if delivery of the Collateral is
required in order to perfect MLMCI's security interest in such
Collateral, and
the Master Repurchase Agreement, executed and delivered on
behalf of Assignor by a duly authorized officer of Assignor.
Proceedings of Assignor. MLMCI shall have received a copy of the
resolutions in form and substance satisfactory to MLMCI and its counsel, of
Assignor authorizing (i) the execution, delivery and performance of the Loan
Documents and the other documents to be executed and/or delivered by it pursuant
hereto or thereto or in connection herewith or therewith, (ii) the borrowings
contemplated hereunder and (iii) the granting by it of the security interest
contemplated hereby, certified by a duly authorized officer of Assignor as of
the Effective Date, which certificate shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded as of the date
of such certificate.
Corporate Documents of Assignor. MLMCI shall have received true and
complete copies of the Certificate of Incorporation and By-Laws of Assignor
(including any and all amendments, supplements and modifications thereto)
certified to such effect by a duly authorized officer of Assignor as of the
Effective Date.
No Violation. The consummation of the transactions contemplated
hereby and by the other Loan Documents shall not contravene, violate or conflict
with, nor involve MLMCI in a violation of, any requirement of law.
Permits, Licenses, Approvals, Consent, etc. MLMCI shall have
received a certificate of a duly authorized officer of Assignor certifying that
all permits, licenses, approvals and consents required in connection with the
execution, delivery and performance by Assignor and the validity and
enforceability against Assignor of this Agreement and the other Loan Documents
have been obtained and such permits, licenses, approvals and consents are in
full force and effect and have not been amended, modified, revoked or rescinded.
Corporate Documents of Onyx. MLMCI shall have received true and
complete copies of the Certificate of Incorporation and By-Laws of Onyx
(including any and all amendments, supplements and modifications thereto)
certified to such effect by a duly authorized officer of Onyx as of the
Effective Date.
Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Agreement and the other
Loan Documents shall be reasonably satisfactory in form and substance to MLMCI
and its counsel.
Conditions Precedent to all Loans and Substitutions. The making of
any Loan or the permitting of any substitution of Substitute Collateral by MLMCI
hereunder is, except as otherwise provided in this Section 7, subject to
compliance by Assignor with the following conditions precedent and the other
terms and conditions hereof and, the giving of any notice by
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Assignor with respect to a Loan pursuant to Section 4 and the acceptance of the
Proceeds of any Loan by Assignor and the substitution of any Substitute
Collateral shall be deemed certification by Assignor that the following
conditions shall have been met:
Representations and Warranties. Each of the representations and
warranties made by Assignor herein and in the other Loan Documents are true and
correct on and as of the Closing Date, before and after giving effect to the
Loan (and the application of the Proceeds therefrom) or the substitution, as
though made on and as of such date.
No Default. Before and after giving effect to such Loan (and the
application of Proceeds therefrom) or such substitution, no Default or Event of
Default shall have occurred and is continuing on and as of the Closing Date.
Financing Statements. The separate financing statement, instrument or
other document, if required by MLMCI to be recorded and/or filed with respect to
the subject Loan or substitution, shall have been so recorded and/or filed.
Good Standing Certificates. On or prior to the initial Closing Date
hereunder and from time to time thereafter as MLMCI may reasonably request (but
not more frequently than quarterly), MLMCI shall have received original
certificates, in form and substance satisfactory to MLMCI and its counsel, from
the Secretary of State or other appropriate authority of such jurisdiction,
evidencing the good standing of Assignor and Onyx in their respective
jurisdiction of incorporation and in each other jurisdiction where the ownership
of their respective property or the conduct of its business requires such
qualification.
Legal Opinion of Counsel to Assignor and Onyx. On or prior to the
initial Closing Date hereunder and on each date after the initial Closing Date
that a security interest in Collateral is granted to MLMCI hereunder Assignor
shall cause to be delivered to MLMCI an opinion of counsel to Assignor and Onyx
(which counsel may be internal counsel for Onyx and shall be satisfactory to
MLMCI), in substantially the form attached hereto as Exhibit C or such other
form as MLMCI and Assignor may mutually agree.
Recordings and Filings. All material instruments and documents
(including, without limitation, financing statements and continuation
statements) required to be filed hereunder in order to create in favor of MLMCI
a perfected security interest in the Collateral hereunder shall have been
properly filed in each office in each relevant jurisdiction and copies of such
instruments and documents, stamped to indicate such filing, shall have been
delivered to MLMCI.
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Proceedings of Onyx. On the date of delivery of the Guaranty MLMCI
shall have received a copy of the resolutions in form and substance satisfactory
to MLMCI and its counsel, of Onyx authorizing the execution, delivery and
performance of the Guaranty certified by a duly authorized officer of Onyx as of
the date of delivery of the Guaranty, which certificate shall state that the
resolutions thereby certified have not been amended, modified, revoked or
rescinded as of the date of such certificate.
Guaranty. On and after the date of delivery of the Guaranty, the
Guaranty shall be in full force and effect.
REPRESENTATIONS AND WARRANTIES
In order to induce MLMCI to enter into this Agreement and to make the
Loans hereunder, Assignor hereby represents and warrants to MLMCI, and shall on
and as of the Closing Date of each Loan and each date on which Substitute
Collateral is substituted, be deemed to represent and warrant to MLMCI, that:
Due Incorporation. Assignor has been duly organized and is validly
existing as a corporation in good standing under the laws of the state of its
incorporation and is duly qualified and in good standing in each other
jurisdiction where the conduct of its business or the ownership, lease or
operation of its property requires such qualification.
Authorization. Assignor has full power and authority to execute and
deliver the Loan Documents and to perform its obligations hereunder and
thereunder; the Loan Documents have each been duly authorized by all necessary
action and neither requires any additional approval of any directors or officers
other than that which has already been obtained, each has been duly executed and
delivered by Assignor and constitutes its legal, valid and binding obligation,
enforceable against it in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, reorganization or similar laws of general
applicability relating to or affecting creditors' rights, to the assumption that
enforcement will be undertaken in a commercially reasonable manner and to
general principles of equity and equitable remedies, regardless of whether
enforcement is considered in a proceeding in equity or at law.
No Conflict. Neither the execution and delivery nor the performance
by Assignor of this Agreement or the Note will conflict with the governing
instruments of Assignor or conflict with, result in a breach of or constitute a
default or require any consent under any instrument or agreement to which
Assignor is a party or by which Assignor may be bound, or any law, order or
regulation applicable to Assignor of any court, governmental agency, authority
or body having jurisdiction over Assignor and do not and will not result in or
require the creation of any lien, security interest or other charge or
encumbrance (other than pursuant hereto) upon or with respect to any of
Assignor's properties.
Approvals, etc. Neither the execution and delivery nor the
performance by Assignor of this Agreement requires any authorization, approval,
consent, license, exemption (other than
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any self-executing exemption), filing, registration or the taking of any other
action in respect of any federal or state authority except where the failure to
comply with such requirement would not adversely affect the delivery, execution
or performance by Assignor of this Agreement or cause a Material Adverse Change.
Good Title. (i) Subject to the ABS Issuance Agreements, Assignor is
the owner of the Collateral and such Collateral is free and clear of all
security interests, liens, charges, encumbrances and rights of others, except
for the lien and security interest created hereby, and on the related Closing
Date, MLMCI has a first priority lien on and security interest in the Collateral
(including all Proceeds, distributions and other amounts realized in respect
thereof) in favor of MLMCI, subject to no prior security interest, lien, charge,
encumbrance or rights of others, and, MLMCI having taken possession of the
Collateral endorsed in the name of MLMCI or its nominee or delivered with such
instruments of transfer as provided in Section 2(b) hereof, no further action,
including any filing or recordation of any document, is currently required in
order to establish and perfect the liens on and security interests in the
Collateral in favor of MLMCI against any third parties in any jurisdiction.
Assignor's chief executive office and the place where its books and
records concerning the Collateral are kept is set forth on Exhibit D hereto.
Each location of Assignor where any of the Collateral is located is set forth on
Exhibit D.
Tax Liens. There are no delinquent federal, state, city, county or
other taxes relating to Assignor, the Collateral or any arrangement pursuant to
which the Collateral is issued that might, in the reasonable judgment of MLMCI,
materially adversely affect any of the Collateral or cause a Material Adverse
Change in Assignor, and all such delinquent tax liabilities have been satisfied
except those that are being contested by Assignor in good faith and with respect
to which payment has been stayed by a court of competent jurisdiction.
Financial Statements. Since the date of the most recent financial
statement delivered by Assignor to MLMCI, there has been no Material Adverse
Change. Assignor shall provide MLMCI with such financial statements and other
information as is contemplated in Section 9(a) hereof.
No Litigation. There are no actions, suits, investigations, or other
proceedings pending, or, to the best knowledge of Assignor, after due inquiry,
threatened, against or affecting Assignor by or before any court, arbitrator,
Governmental Authority which challenge any of the transactions contemplated
under this Agreement or any other Loan Document or could result in a Material
Adverse Change and there are no preliminary or permanent injunctions or orders
by any court or other Governmental Authority pending affecting this Agreement or
any other Loan Document or any of the transactions contemplated hereby or
thereby.
Disclosure. No certificate, statement, report or other document
furnished and no representation or warranty made or to be furnished or made to
MLMCI by or on behalf of
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Assignor in or in connection with this Agreement or any transaction contemplated
hereby, or in connection with any other Loan Document or any transaction
contemplated thereby, at the time furnished, contains or will contain any untrue
statement of a material fact or omits or will omit to state any material fact
necessary in order to make the statements contained therein not misleading.
Permits, Licenses, Approvals, Consents, etc. Assignor has obtained
any and all permits, licenses, approvals and consents of any Governmental
Authority or other Person as may be required in connection with the execution,
delivery and performance by and the validity and enforceability against Assignor
of this Agreement and the other Loan Documents and the consummation of the
transactions contemplated hereby or thereby (all such permits, licenses,
approvals and consents, if any, are in full force and effect and have not been
amended, modified, revoked or rescinded).
The Investment Company Act. Assignor is not an "investment company",
or an entity "controlled by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended.
Ownership of Assignor. Assignor is a direct or indirect
wholly-owned subsidiary of Onyx.
AFFIRMATIVE COVENANTS
Until the Obligations are paid and satisfied in full and this Agreement
has been terminated, Assignor covenants and agrees that it will:
Financial Statements and Other Information. Furnish to MLMCI:
as soon as available and in any event within sixty (60) days after
the close of each of the first three (3) quarters of each fiscal year of
Assignor, the Onyx applicable quarterly Form 10-Q as filed with the Securities
and Exchange Commission, including the consolidating statements for the
Assignor, subject to normal recurring year-end audit adjustments, and as
prepared in accordance with GAAP;
as soon as available and in any event within one hundred and twenty
(120) days after the close of each fiscal year of Onyx, a consolidated balance
sheet of Onyx, a consolidated statement of income of Onyx and a consolidated
statement of changes in financial position of Onyx's consolidated financial
group as at the end of and for the fiscal year just closed, setting forth the
corresponding figures of the previous fiscal year, if applicable, in comparative
form, all in reasonable detail and certified (without any qualification or
exception deemed material by MLMCI); by independent public accountants selected
by Onyx and reasonably satisfactory to MLMCI;
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concurrently with the delivery of the financial statements required
to be furnished by Section 9(a)(ii) hereof, a certificate signed by the chief
executive or financial officer of Assignor, stating (1) that a review of the
activities of Assignor during such quarter or fiscal year, as the case may be,
has been made under his or her immediate supervision with a view to determining
whether Assignor has observed, performed and fulfilled all of its obligations
under this Agreement and whether Assignor is in compliance with the
representations and warranties in Section 8 hereof and the covenants in Sections
9 and 10 hereof, and (2) that there existed during such quarter or fiscal year,
as the case may be, no Event of Default and no Default or if any such Event of
Default or Default did exist, specifying the nature thereof, the period of
existence thereof and what action Assignor proposes to take, or has taken, with
respect thereto;
promptly, and in any event no later than five (5) Business Days,
after the commencement thereof, written notice of any material actions, suits or
proceedings (including arbitrations) against Assignor or Onyx before any court
or other Governmental Authority;
immediately upon becoming aware of any development or other
information which is reasonably likely to result in a Material Adverse Change of
Assignor or Onyx, as applicable, written notice specifying the nature of such
development or information, such anticipated effect and action, if any, Assignor
or Onyx proposes to take or has taken with respect thereto;
with reasonable promptness of Assignor or Onyx, as applicable, such
other information respecting any matter likely to result in a Material Adverse
Change of Assignor or Onyx, as applicable, as MLMCI may reasonably request from
time to time.
Existence, Conduct of Business, etc. Continue to engage primarily in
the business of the same general type as now conducted by it and preserve, renew
and maintain in full force and effect its existence and all permits, licenses,
approvals, consents, rights, privileges and franchises necessary or desirable in
the conduct or transaction of its business or the ownership or operation of its
properties or the lease of its properties to which it is a lessee.
Taxes. Assignor will pay and discharge all taxes, levies, liens and
other charges on its assets and on the Collateral that, in each case, in any
manner would create any lien or charge upon the Collateral.
Laws. Assignor will at all times comply in all material respects
with all laws, ordinances, rules and regulations of any federal, state,
municipal or other public authority having jurisdiction over Assignor or any of
its assets.
Name and Locations. Assignor will immediately advise MLMCI in
writing of the opening of any new chief executive office or the closing of any
such office and of any change in Assignor's name or the places where the books
and records pertaining to the Collateral are kept.
Records. Assignor will maintain records with respect to the
Collateral and the conduct and operation of its business in conformity with
general industry standards and with no
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less a degree of prudence than if the Collateral were held by Assignor for its
own account and will furnish MLMCI, upon reasonable request by MLMCI or its
designated representative, with reasonable information with respect to the
Collateral and the conduct and operation of its business. Assignor will permit
MLMCI or its designated representative to inspect Assignor's records with
respect to the Collateral and the conduct and operation of its business upon
reasonable notice from MLMCI or its designated representative, at such
reasonable times and with reasonable frequency, and to make copies or extracts
of any and all thereof. MLMCI shall act in a commercially reasonable manner in
requesting and conducting any inspection relating to the conduct and operation
of Assignor's business.
Pay Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, all its material
obligations of whatever nature, except when the amount or validity thereof is
currently being contested in good faith by appropriate proceedings and the
Assignor has established adequate reserves with respect thereto and no Liens
have attached to the Collateral or any portion thereof.
Notices. Promptly, and in any event within one (1) Business Day of
the occurrence thereof, notify MLMCI in writing of (i) the occurrence of any
Default or Event of Default hereunder or under any other Loan Document or (ii)
any event of default by any party thereto under any indenture, mortgage, deed of
trust, agreement or other instrument or contractual obligation to which the
Assignor is a party or by which any of its properties may be bound or affected
which could result in a Material Adverse Change, and specifying in each case the
action the Assignor has taken or proposes to take with respect thereto.
Covenant Compliance Certificate. Deliver or cause to be delivered a
Covenant Compliance Certificate to MLMCI on the first Business Day of each
calendar month.
Monthly Collateral Report. Furnish or cause to be furnished to
MLMCI, on the last Business Day of each month, a report for each Pledged ABS
substantially in the form of, and containing the information set forth on,
Exhibit F hereto.
Guaranty. Assignor shall proceed in good faith to cause Onyx to
amend Onyx's existing warehouse agreements so as to enable Onyx to provide to
MLMCI a guaranty substantially in the form of the Guaranty, and after such
amendments have been made Assignor shall proceed in good faith to cause Onyx to
provide such guaranty to MLMCI.
NEGATIVE COVENANTS
Until the Obligations are paid and satisfied in full and this Agreement
has been terminated, the Assignor covenants and agrees that it will not:
Liens. Create, incur, assume or suffer to exist, any Lien on any of
the Collateral whether now owned or hereafter acquired, other than Liens in
favor of MLMCI hereunder.
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Mergers, Sales, Dissolution, etc. (i) Merge into or consolidate with
any other Person without the prior consent of MLMCI, which consent shall not be
unreasonably withheld, or (ii) assign, transfer, sell, lease, or otherwise
dispose of any of the Collateral, or all or substantially all of its other
property or assets to any other Person or (iii) wind up, liquidate or dissolve,
or agree to do any of the foregoing.
Corporate Changes. Change its name, principal place of business, the
location where its books and records are kept with respect to the Collateral or
corporate structure or ownership on less than thirty (30) days prior written
notice to MLMCI. MLMCI is hereby notified and acknowledges the prospective
change in Assignor's principal place of business as described in Section 9(e)
above.
Use of Proceeds. The Proceeds of the Loans made pursuant to this
Agreement will not be used by the Assignor, directly or indirectly, for the
purpose of purchasing or carrying any Margin Stock or for the purpose of
reducing or retiring any debt which was originally incurred to purchase or carry
Margin Stock or for any other purpose which might constitute the Loans under
this Agreement as being "purpose credit" within the meaning of Regulation G or X
of the Board of Governors of the Federal Reserve System.
Further Covenants. Without prior written consent of MLMCI, Assignor
will not: (i) assign, sell, transfer, pledge or grant any security interest in
or lien on any of the Collateral to anyone except MLMCI, permit any financing
statement (except any financing statements in favor of MLMCI) or assignment
(except for any assignments in favor of MLMCI) to be on file in any public
office with respect thereto, (ii) permit or suffer to exist any security
interest, lien, charge, encumbrance or right of others to attach to any of the
Collateral, except as contemplated by this Agreement, or (iii) consent to any
amendment or supplement to any ABS Issuance Agreement that is reasonably likely
to result in a material adverse affect on the Market Value of the Pledged ABS,
but excluding in any event any amendment or supplement that effectuates a
letter-of-credit and the limited quarterly substitution into a related reserve
fund for the release of cash as contemplated in such ABS Issuance Agreement.
EVENTS OF DEFAULT
Each of the following, so long as it shall not have been remedied, shall
constitute an "Event of Default" hereunder:
Nonperformance. Any failure to pay, whether on the acceleration
thereof or otherwise, any amounts due under the Note or any failure to pay any
amount due under this Agreement or to perform any provision of this Agreement in
accordance herewith, or any material breach of any representation, warranty or
covenant set forth herein or in the Note.
Termination of Interest. The lapse or termination of Assignor's
interest in any of the Collateral.
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Act of Insolvency. The filing by Assignor or any affiliate, of a
petition in bankruptcy, the adjudication of Assignor or any affiliate as
insolvent or bankrupt, the petition or application by Assignor or any affiliate
for any receiver or trustee for itself or any substantial part of its property,
the commencement by Assignor or any affiliate of any proceeding relating to it
under any reorganization, arrangement, dissolution or liquidation law, or the
initiation of any such proceeding against Assignor or any affiliate, if Assignor
or such affiliate indicates by any act its consent thereto or if such proceeding
is not dismissed within sixty (60) days.
Material Adverse Change. In the reasonable judgment of MLMCI, a
Material Adverse Change with respect to Assignor or Onyx shall have occurred.
Default Under Other Contracts. Assignor shall be in default with
respect to any normal and customary covenants under any contract or agreement to
which it is a party (which covenants include, but are not limited to, an Act of
Insolvency of Assignor or the failure of Assignor to make required payments
under such contract or agreement as they become due) which default permits
acceleration of the obligations of Assignor under such contract or agreement by
any other party thereto and which default, in the reasonable judgment of MLMCI,
is likely to result in a Material Adverse Change with respect to Assignor or
Onyx.
Merger or Consolidation. Assignor shall merge or consolidate into
any entity or shall no longer be wholly-owned by Onyx unless MLMCI shall have
expressly consented to such merger or consolidation in writing, which consent
shall not be unreasonably withheld.
Anticipated Insolvency. MLMCI shall reasonably determine that
Assignor is or will be unable to meet its commitments hereunder or, on and after
the delivery of the Guaranty, that Onyx is or will be unable to meet its
commitments under the Guaranty, notifies Assignor of such determination and
Assignor shall not have responded with appropriate information to the contrary
to the satisfaction of MLMCI within thirty-six (36) hours.
Final Judgment. A final, non-appealable judgment by any competent
court in the United States for the payment of money in an amount of at least
$100,000 is rendered against Assignor or Onyx, and the same remains undischarged
and unpaid for a period of sixty (60) days during which execution of such
judgment is not effectively stayed.
Breach of Credit Covenants. The occurrence of any of the following:
(1) Onyx shall experience losses or changes in its financial
condition (exclusive of amounts withdrawn for payment of taxes due and
payable by the shareholders of Onyx) that cause its Net Worth for any
two consecutive calendar quarters to be less than or equal to 80% of its
Net Worth as of the commencement of such period.
(2) The ratio of Onyx's total Indebtedness to Onyx's Net Worth
determined as of the end of each calendar month shall exceed 8:1.
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(3) Onyx's Net Worth shall at any time be less than $30,000,000.
Breach of Representation. Any representation or warranty made by
Assignor herein shall have been incorrect or untrue in any material respect when
made or repeated or when deemed to have been made or repeated and which breach,
in the reasonable judgment of MLMCI, is likely to result in a Material Adverse
Change of Assignor or Onyx.
Breach of Covenant. Assignor shall breach in any material respect
any covenant made by it herein and MLMCI's interests shall have been materially
adversely affected thereby.
REMEDIES
Action Regarding Collateral. If an Event of Default shall occur,
MLMCI, without demand of performance or other demand or notice of any kind to
Assignor or any other person, all of which are hereby expressly waived, may
forthwith apply the cash, if any, then held by it as part of the Collateral
relating to any Loan to the payment of any of the Obligations, and, if there
shall be no such cash or the cash so applied shall not be sufficient to pay in
full all such Obligations, may thereafter collect, receive, appropriate, retain
and realize upon the Collateral, or any part thereof, and may forthwith sell,
assign, give an option or options to purchase, contract to sell, or otherwise
dispose of and deliver the Collateral, or any part thereof, in one or more
parcels at such public or private sale or sales, at such place or places, at
such price or prices and upon such other terms and conditions as MLMCI may deem
best (provided, however, that MLMCI shall act in all respects in a commercially
reasonable manner), for cash or on credit or for future delivery without
assumption of any credit risk, with the right of MLMCI upon any such sale or
sales to purchase all or any part of the Collateral so sold. Upon any sale,
transfer or other disposition of the Collateral pursuant hereto MLMCI shall have
the right to deliver, assign and transfer to the transferee thereof the
Collateral so sold. Each transferee upon any such transfer or other disposition
shall hold the property thereby acquired by it absolutely free from any claim or
right of any kind, including any equity or rights of redemption, of Assignor,
who hereby specifically waives all rights of redemption, stay or appraisal which
it has or may have under any rule of law or statute whether now existing or
hereafter adopted (in the latter case, to the extent permitted thereby).
Assignor agrees that MLMCI need give only such notice of the time and place of
any public or private sale (including any adjourned private sale) or other
intended disposition as may be required by market conditions and standards of
commercial reasonableness and that MLMCI need not in any event give more than
five (5) Business Days' notice that such sale or disposition is to take place.
Assignor agrees that the notice provided for in the preceding sentence is
reasonable notification of such matters.
MLMCI shall not be obligated to make any sale pursuant to any such
notice. MLMCI 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 MLMCI until the selling price is paid by the purchaser
thereof, but MLMCI
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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. MLMCI, however, instead of
exercising the power of sale herein conferred upon it, may proceed by a suit or
suits at law or in equity to foreclose the lien and security interest created
hereby and sell the Collateral, or any portion thereof, under a judgment or
decree of a court or courts of competent jurisdiction.
Deficiency. If the Proceeds of sale, collection, foreclosure or
other realization of or upon the Collateral are insufficient to cover the costs
and expenses of such realization and the payment in full of the Obligations,
Assignor shall remain liable for any deficiency.
Private Sale. MLMCI shall incur no liability as a result of the sale
of the Collateral (provided, however, that MLMCI shall act in a commercially
reasonable manner) or any part thereof, at any private sale. Assignor hereby
waives any claims against MLMCI or any holder or holders of the Note arising by
reason of the fact that the price at which the Collateral may have been sold at
such a 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 Obligations, even if
MLMCI accepts the first offer received and does not offer the Collateral to more
than one offeree (provided, however, that MLMCI shall act in a commercially
reasonable manner).
Application of Proceeds. The Proceeds of any sale or other
realization of all or any part of the Collateral, and any other cash at the time
held by MLMCI under this Agreement, shall be applied by MLMCI in the following
order of priority:
First, to the payment of the costs and expenses of such sale and
all expenses (including the reasonable fees and expenses of counsel),
liabilities and advances made or incurred by MLMCI in connection
therewith.
Second, to the payment of all accrued interest under the Note
due or past due.
Third, to the payment of principal upon the Note due or past
due.
Fourth, to the payment of all other amounts owing under this
Agreement.
Fifth, to the payment to Assignor, or to such other person as a
court of competent jurisdiction may direct, of any surplus then
remaining from such Proceeds and other cash.
Default Rate of Interest. After demand is made with respect to the
Note or upon acceleration thereof, until the balance thereof shall be paid, the
Loan amounts due thereunder, shall bear interest at a per annum rate (based on a
year of 360 days and actual days elapsed) equal to two hundred (200) basis
points in excess of the interest rate for such Loan, but in no event higher than
the maximum rate permitted by law.
Attorney-in-Fact. Effective upon the occurrence of an Event of
Default hereunder, MLMCI is hereby appointed the attorney-in-fact of Assignor
for the purpose of carrying out the provisions of this Agreement and taking any
action and executing any instruments which MLMCI may deem necessary or advisable
to accomplish the purposes hereof, which
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appointment as attorney-in-fact is irrevocable and coupled with an interest.
Without limiting the generality of the foregoing, after an Event of Default has
occurred, MLMCI shall have the right and power to receive, endorse and collect
all checks made payable to the order of Assignor representing any distribution
in respect of the Collateral or any part thereof and to give full discharge for
the same.
Payments on Collateral to Assignor.
All rights of Assignor to receive any payments from the related
Collateral which it would otherwise be authorized to receive shall cease, and
all such rights shall thereupon become vested in MLMCI, which shall thereupon
have the sole right to receive and hold as Collateral such payments.
All payments which are received by Assignor contrary to the
provisions of the preceding subsection (i) shall be received in trust for the
benefit of MLMCI, shall be segregated from other funds of Assignor and shall be
promptly paid to MLMCI.
Cross-Collateralization; Right of Set-Off. MLMCI may, in its sole
discretion upon the occurrence and during the continuation of an Event of
Default hereunder, proceed against any assets held by it under the Master
Repurchase Agreement and shall have a right of set-off against any amounts owed
by MLMCI to Assignor under the Master Repurchase Agreement. In addition, the
parties agree that MLMCI may, in its sole discretion upon the occurrence and
during the continuation of an event of default under the Master Repurchase
Agreement, proceed against any assets held by it hereunder and shall have a
right of set-off against any amounts owed by MLMCI to Assignor hereunder.
MATURITY DATE; INTEREST PAYMENT DATES;
REPAYMENT OF PRINCIPAL
Payment on Maturity Date. Assignor and MLMCI hereby agree that the
Obligations of Assignor hereunder and under the Note are payable on the Maturity
Date unless earlier payment thereof is required pursuant to the terms of this
Agreement.
Interest Payment. Interest on each Loan shall be payable on the
dates described in the related Confirmation Statement.
Payment of Principal. The principal portion of each Loan may be
repaid in whole or in part at the discretion of Assignor on any date on which a
payment of interest is to be made thereon by Assignor pursuant to the terms of
this Agreement and the related Confirmation Statement provided that (i) Assignor
shall have provided MLMCI with not less than two (2) Business Days' written
notice of Assignor's intention to effect such repayment and the amount thereof,
(ii) all payments of interest then due and owing on the Loan are paid in full
and (iii) no Event of Default has occurred and is continuing with respect to any
of Assignor's Obligations hereunder or under the Note.
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Event of Default. Nothing in this Section 13 shall be deemed to
limit the right of MLMCI to require, so long as an Event of Default shall have
occurred and is continuing, the payment by Assignor of all Obligations arising
hereunder and under the Note.
PAYMENT OF TAX LIABILITY
The Assignors and MLMCI agree that any tax or other liability (excluding
any tax liability arising from the receipt by MLMCI of interest income on any
Loan under this Agreement) incurred by the beneficial owner or the registered
holder of any Collateral pledged under the this Agreement shall be borne by
Assignor. So long as any Obligations are outstanding hereunder, Assignor agrees
to indemnify MLMCI for, and to hold MLMCI harmless against, any liability
inuring to MLMCI as a result of the endorsement of the Collateral in MLMCI's
name, or MLMCI's status as the lender hereunder or beneficial holder of such
Collateral, including, without limitation, any tax liability (excluding any tax
liability arising from the receipt by MLMCI of interest income on any Loan under
this Agreement) or liability for the payment of expenses of the trust funds
established under the applicable ABS Issuance Agreements.
GENERAL PROVISIONS
No Waiver. No waiver or amendment of or forbearance in enforcing any
provision of this Agreement nor consent to any departure by either party
herefrom shall be effective unless expressly granted in writing and shall be
limited to the extent expressed therein.
Governing Law; Severability. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
agreements made and entirely performed therein. Unless otherwise defined herein,
terms defined in the UCC are used herein as defined therein. Each provision of
this Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be prohibited
by or be invalid under such law, such provision shall be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
Construction. The captions in this Agreement are for convenience of
reference only and shall not affect the construction or interpretation of any of
the provisions hereof.
Assignment. This Agreement shall be binding upon and shall inure to
the benefit of each of the parties hereto and their respective successors and
assigns; provided, however, that neither this Agreement nor any rights or other
obligations hereunder may be assigned by Assignor without prior written consent
of MLMCI and any attempted or purported assignment hereof or thereof shall be
void. MLMCI may assign any or all of its rights hereunder without consent.
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Notices, Payments, Deliveries. Unless otherwise provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, facsimile or telex communication), and such notices and
other communications shall, when mailed, telegraphed, communicated by facsimile
transmission or telexed, be effective when received at the address for notices
for the party to whom such notice or communications is to be given as follows:
If to MLMCI:
Xxxxxxx Xxxxx Mortgage Capital Inc.
Xxxxxxx Xxxxx World Headquarters
World Financial Center
Xxxxx Xxxxx - 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Telephone: (212) 449 - 5939
Telecopy: (212) 449 - 6673
With a copy to:
Attention: Xxxxxxx X. Xxxx
Telephone: (212) 449 - 8486
Telecopy: (212) 449 - 6673
If to Assignor:
Onyx Acceptance Funding Corporation
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
provided, however, that a facsimile or other form of electronic transmission
shall be deemed to be received by the parties hereto when transmitted so long as
the transmitting machine has provided an electronic confirmation of such
transmission and such facsimile or other form of electronic transmission is
confirmed with a printed paper copy thereof by mail or overnight courier
service. All payments on and deliveries of Collateral hereunder shall be made to
the address or account for payments and deliveries of such Collateral for the
party to whom such payment or delivery is to be made as set forth above. Either
party may revise any information relating to it by notice in writing to the
other party, which notice shall be effective on the third Business Day following
receipt thereof.
Termination. When all Obligations shall have been paid in full and
upon the written request of Assignor, this Agreement shall terminate and MLMCI
shall release its lien and security interest hereunder and assign, transfer and
deliver, against receipt, any remaining Collateral and money received in respect
thereof to or on the order of Assignor. Upon the request of Assignor, MLMCI will
then execute termination statements and such other documents as Assignor may
reasonably request as are necessary to make clear upon the public record the
termination of the lien and security interests created hereby with respect to
such assignment. The
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obligations of Assignor under Section 15(h) below shall, with respect to each
transaction entered into hereunder, survive any termination hereof.
Aggregate Amount of Loans; Disbursement of Funds.
The aggregate outstanding principal amount of the Loans made by
MLMCI hereunder shall be limited to the Maximum Advance Amount.
Assignor may request disbursement of amounts borrowed hereunder
upon not less than two (2) Business Days' written notice to MLMCI.
MLMCI is not obligated to make any Loan or advance under this
Agreement or pursuant to the Note; provided that MLMCI agrees in good
faith to give reasonable notice to Assignor of its intention not to make
any further Loans or advances hereunder.
Expenses.
Assignor shall pay its own costs and expenses and all reasonable
costs and expenses of MLMCI (including reasonable expenses for legal
services) incident to the preparation and negotiation of this Agreement
and any documents relating hereto, provided that Assignor's liability
for such costs and expenses of MLMCI shall not exceed a total of
$25,000.
Assignor agrees to pay to MLMCI on demand all reasonable costs and
expenses (including reasonable expenses for legal services) of any
subsequent enforcement of any of the provisions hereof, or of the
performance by MLMCI of any Obligations of Assignor in respect of the
Collateral which Assignor has failed or refused to perform, or any
actual or attempted sale, or any exchange, enforcement, collection,
compromise or settlement in respect of any of the Collateral and for the
custody, care or preservation of the Collateral (including insurance
costs) and defending or asserting rights and claims of MLMCI in respect
thereof, by litigation or otherwise, including expenses of insurance. In
addition, Assignor agrees to pay to MLMCI on demand all costs and
expenses (including reasonable expenses for legal services) of the
registration of the Collateral in the name of MLMCI or its nominee. All
such expenses shall be Obligations to MLMCI secured under this
Agreement.
MLMCI's Right to Pledge. Nothing in this Agreement shall preclude
MLMCI from engaging in transactions with third parties involving the selling
pursuant to a repurchase arrangement, pledging or hypothecating of the
Collateral, but no such transaction shall relieve MLMCI of its obligations
hereunder. MLMCI hereby grants to Assignor the right to perform in MLMCI's stead
under any repurchase, reverse repurchase, loan or similar transaction in which
MLMCI has sold, pledged or otherwise transferred any Pledged ABS in the event
that MLMCI has defaulted on its obligations to repurchase or accept redelivery
of such Pledged ABS in conformity with the terms of any such transaction and so
long as an Event of Default hereunder
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by Assignor shall not have occurred and be continuing. MLMCI further
acknowledges that each Pledged ABS identified in a Confirmation Statement and
included as Collateral for a Loan hereunder is unique and identifiable on the
date of such Loan and that an award of money damages would be insufficient to
compensate Assignor for the losses and damages incurred by Assignor in the event
of MLMCI's failure to release and redeliver any Pledged ABS upon the repayment
of the related Loan by Assignor as provided hereunder.
Indemnification. Assignor agrees to indemnify and hold harmless
MLMCI against all liabilities and expenses to which MLMCI may become subject
relating to any fees, taxes or liability to any third party resulting from any
action taken or omitted by or upon instructions of Assignor with respect to the
Collateral.
Further Assurances. Assignor agrees that, from time to time upon the
prior written request of MLMCI, it will (i) execute and deliver such further
documents and do such other acts and things as MLMCI may reasonably request in
order to fully effectuate the purposes of this Agreement and (ii) provide such
opinions of counsel concerning matters relating to this Agreement as MLMCI may
reasonably request.
Remedies Cumulative. All rights, remedies and powers of MLMCI
hereunder and in connection herewith are irrevocable and cumulative, and not
alternative or exclusive, and shall be in addition to all other rights, remedies
and powers of MLMCI whether under law, equity or agreement. In addition to the
rights and remedies granted to it in this Agreement or under the Note, MLMCI
shall have all the rights and remedies of a secured party under the UCC.
Litigation. Notwithstanding any termination hereof, Assignor hereby
agrees that any legal action or proceeding against it in connection herewith may
be brought in the courts of the State of New York or of the United States of
America located in the City and State of New York, Borough of Manhattan, as
MLMCI may elect, and Assignor hereby irrevocably submits to the jurisdiction of
each of said courts, and waives any objection on the grounds of venue, forum non
conveniens or similar grounds.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
ONYX ACCEPTANCE FUNDING CORPORATION
By: ______________________________________
Name: ____________________________________
Title: ___________________________________
XXXXXXX XXXXX MORTGAGE CAPITAL INC.
By: ______________________________________
Name: ____________________________________
Title: ___________________________________
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EXHIBIT A
THIS NOTE IS NOT A
NEGOTIABLE INSTRUMENT.
NO TRANSFER OR SALE OF THIS NOTE SHALL BE MADE UNLESS SUCH TRANSFER IS EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED,
AND ANY APPLICABLE STATE SECURITIES LAWS OR IS MADE IN ACCORDANCE WITH SAID ACT
AND LAWS.
NOTE
$50,000,000 New York, New York February 4, 1998
(subject to the Maximum Advance Amount)
FOR VALUE RECEIVED, ONYX ACCEPTANCE FUNDING CORPORATION (the "Assignor")
promises to pay to XXXXXXX XXXXX MORTGAGE CAPITAL INC. (the "Payee") the
principal sum of Fifty Million Dollars ($50,000,000) (or so much thereof as
shall have been advanced here against pursuant to the Master Assignment
Agreement and shall be outstanding), in lawful money of the United States of
America, in immediately available funds, with interest on each principal sum
advanced here against or the unpaid balance thereof with such frequency and to
such location as is specified in the related confirmation statement (in each
case, the "Confirmation Statement") for such advance (or on such other day and
with such other frequency and to such other location as may be mutually agreed
upon by the Assignor and the Payee) at said office and in said money and funds
from (and including) the date of the related Loan advance to (but excluding) the
related Maturity Date for such Loan at the rate per annum (based on a year of
360 days and actual days elapsed) indicated on the related Confirmation
Statement attached hereto, but in no event higher than the maximum rate
permitted by law, and after such Maturity Date, or upon acceleration as
hereinafter provided, until said balances shall be paid, at the rate per annum
(based on a year of 360 days and actual days elapsed) equal to two hundred (200)
basis points in excess of the interest rate for such advance, but in no event
higher than the maximum rate permitted by law.
Loans here against shall be in minimum amounts of $1,000,000. The
Assignor may request disbursement of amounts borrowed hereunder upon not less
than two (2) Business Days' written notice to the Payee. The Payee is not
obligated to make any advances hereunder. The Payee is hereby authorized by the
Assignor to endorse on the Loan Schedule amounts advanced here against, the rate
of interest relating thereto and any principal prepayments hereunder (as
permitted by the Assignment defined below), it being understood, however, that
failure to make any such endorsement shall not affect the obligations of the
Assignor hereunder in respect of the amounts advanced here against.
This Note is the Note referred to in the Master Assignment Agreement
(the "Master Assignment Agreement"), dated as of February 4, 1998, between
Assignor and the Payee, granting to the Payee a first priority perfected
security interest in the Collateral, as described therein. The holder is
entitled to the benefits of the Master Assignment Agreement and may enforce the
agreements of the Assignor contained therein and exercise the remedies provided
for thereby or otherwise available in respect thereof. All capitalized terms
used in this Note and not otherwise defined shall have the respective meanings
set forth in the Master Assignment Agreement except where the context clearly
indicates otherwise.
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This Note and all other present and future obligations of any and all
kinds of the Assignor in favor of the holder hereof, whether created directly or
acquired by assignment, whether absolute or contingent, shall, unless the holder
shall otherwise elect, forthwith be due and payable without notice or demand of
any kind (except as expressly provided in the Master Assignment Agreement), all
of which are expressly waived upon the occurrence of an Event of Default.
The Assignor hereby agrees that any legal action or proceeding against
it for enforcement of this Note or of any judgment with respect to this Note may
be brought in the courts of the State of New York or of the United States of
America located in the City and State of New York, Borough of Manhattan, as the
holder may elect, and the Assignor hereby irrevocably submits to the
jurisdiction of each of said courts, and waives any objection on the grounds of
venue, forum non conveniens or similar ground. The Assignor irrevocably consents
that service of process in any such action or proceeding may be made upon the
Assignor by the mailing thereof by the holder by United States registered or
certified mail, postage prepaid, to the Assignor at the address set forth herein
below the signature of the Assignor, and the Assignor hereby further agrees that
service of process in such manner shall be full and sufficient notice of any
such action or proceeding.
The Assignor waives diligence, presentment of any instrument, protest
and notice of non-payment or protest and any and all other notices and demands
whatsoever in connection with the delivery, acceptance, performance, default or
enforcement of this Note. The Assignor will pay on demand all costs of
collection (including reasonable attorneys' fees) paid or incurred by the holder
in enforcing this Note on default. As used herein, the world "holder" shall mean
the Payee or any endorsee of this Note who is in possession hereof, if this Note
is at the time payable to the bearer.
This Note shall be governed by and construed in accordance with the
laws of the State of New York applicable to agreements made and entirely
performed therein.
ONYX ACCEPTANCE FUNDING CORPORATION
By: ______________________________________
Name: ____________________________________
Title: ___________________________________
X-0
00
XXXX XXXXXXXX
This Note evidences Loans made by the Payee to the Assignor and the repayment of
principal by the Assignor to the Payee, in the principal amounts and on the
dates and with the related interest rates set forth below as well as the total
amount advanced here against as of each such date:
PRINCIPAL PRINCIPAL TOTAL
DATE AMOUNT LOANED INTEREST RATE AMOUNT REPAID OUTSTANDING
---- ------------- ------------- ------------- -----------
-------------- ------------- ------------- ------------- -----------
-------------- ------------- ------------- ------------- -----------
-------------- ------------- ------------- ------------- -----------
-------------- ------------- ------------- ------------- -----------
-------------- ------------- ------------- ------------- -----------
-------------- ------------- ------------- ------------- -----------
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EXHIBIT B
CONFIRMATION STATEMENT
XXXXXXX XXXXX MORTGAGE CAPITAL INC.
Date: __________________________
Assignor: Onyx Acceptance Funding Corporation
Address:
Attention:
Telephone:
Fax Number:
Re: LOAN PURSUANT TO MASTER ASSIGNMENT AGREEMENT
Gentlemen:
Xxxxxxx Xxxxx Mortgage Capital Inc. ("MLMCI") is pleased to confirm our Loan to
you (the "Assignor") pursuant to the Master Assignment Agreement (the "Master
Assignment Agreement"), dated as of February 4, 1998, between you and MLMCI
under the following terms and conditions:
1. Collateral Description: ________________________
A. Security Issue Date: ______________________
B. Percentage Ownership: _____________________%
C. Face Amount: $_____________________
D. Current Market Value: $_____________________
E. Margin Requirement: _____________________%
2. Loan: _____ New Funds _____ Roll
A. Amount: $______________
B. Closing Date: _______________
C. Interest Payment Date: The last Business Day of each month.
MLMCI's Wiring Instructions Assignor's Wiring Instructions
--------------------------- ------------------------------
Bankers Trust New York
For the Account of Xxxxxxx Xxxxx
Mortgage Capital Inc.
Account Number: 00000000
ABA Number: 000-000-000
The Note, dated February 4, 1998, which evidences advances under
the Master Assignment Agreement will be annotated on the schedule attached
thereto to reflect the date, amount and interest rate relating to this advance.
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The Master Assignment Agreement is incorporated by reference
into this Confirmation Statement and made a part hereof as if it were fully set
forth herein. All capitalized terms used herein but not otherwise defined shall
have the meanings specified in the Master Assignment Agreement.
Very truly yours,
XXXXXXX XXXXX MORTGAGE CAPITAL INC.
By: ______________________________
Name: ________________________
Title: _______________________
AGREED AND ACKNOWLEDGED:
ONYX ACCEPTANCE FUNDING CORPORATION
By: _____________________________
Name: ___________________________
Title: ____________________________
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EXHIBIT C
[FORM OF OPINION OF COUNSEL TO THE ASSIGNOR]
[OPINIONS RELATING TO THE GUARANTY SHALL BE
DELIVERED WHEN THE GUARANTY IS DELIVERED]
Gentlemen:
We have acted as counsel to Onyx Acceptance Funding
Corporation, a Delaware corporation (the "Assignor"), in connection with (i) the
execution and delivery of the Master Assignment Agreement, dated as of February
4, 1998 (the "Agreement"), between the Assignor and Xxxxxxx Xxxxx Mortgage
Capital Inc., a Delaware corporation ("MLMCI") and (ii) the execution and
delivery of the Note, dated February 4, 1998 in the principal amount of
$50,000,000 ("Note") made by the Assignor to the order of MLMCI. In addition, we
have acted as counsel to Onyx Acceptance Corporation, a Delaware corporation
("Onyx"), in connection with its partial guaranty, dated February 4, 1998 (the
"Guaranty"), of the obligations of Assignor under the Agreement. Unless
otherwise defined herein, all defined terms used herein shall have the meanings
assigned thereto in the Agreement.
As counsel to the Assignor and Onyx, we have participated in
the preparation and negotiation of the Agreement, the Note, the Guaranty and the
other documents and instruments executed and delivered pursuant thereto and in
connection therewith by the Assignor.
In this connection, we have examined, among other documents,
the Certificate of Incorporation and By-Laws of the Assignor and Onyx, the
minutes of meetings of the Assignor, and such other documents and records of the
Assignor and Onyx as we have deemed relevant and necessary as a basis for the
conclusions contained in the opinions hereafter set forth. As to factual
matters, we have relied, among other things, without independent investigation,
on the factual representations of each of the Assignor and Onyx in officer's
certificates and such factual representations of each of the Assignor and Onyx
as appear in the Agreement, the Note, the Guaranty and the officer's
certificates. In addition, we have obtained and relied upon such other documents
and certificates as we have demed necessary or appropriate as a basis for the
opinions hereinafter expressed. In our examination, we have assumed the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals and the conformity to originals of all documents submitted to us
photostatic copies.
Based upon the foregoing, we are of opinion that:
The Assignor is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware and has
the corporate power and authority to execute, deliver and perform its
obligations under the Agreement and the Note. Assignor is duly qualified to do
business and is in good standing in each jurisdiction in which the character of
the business transacted by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the business,
properties, assets or condition (financial or other) of Assignor and its
subsidiaries, considered as a whole.
Each of the Agreement and the Note has been duly executed and
delivered by Assignor and constitutes the legal, valid and binding obligation of
Assignor enforceable against Assignor in accordance with its terms.
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No authorization, consent approval, license, filing or
registration with any governmental or regulatory authority or agency is required
under California, New York or federal law for the validity of the execution and
delivery of, or performance by Assignor of its obligations under the Agreement
and the Note (except (a) such as have been received or made, (b) such as may be
required under California, New York or federal securities laws, as to which no
opinion is expressed, and (c) such filings of financing or continuation
statements as may be required to be made under the Uniform Commercial Code in
any jurisdiction).
The execution, delivery and performance by Assignor of the
Agreement and the Note (a) has been duly authorized by all necessary corporate
action on the part of Assignor, (b) does not and will not violate, or result in
a breach of (1) the Certificate of Incorporation or Bylaws of Assignor, (2) the
provisions of the Delaware General Corporate Law or any California, New York or
federal law, rule or regulation applicable to Assignor (other than California,
New York and federal securities laws, as to which no opinion is expressed) or
(3) to the best of counsel's knowledge, any order of any court or other
governmental authority to which Assignor is a party or by which Assignor or any
of its properties are bound or subject, where, in the case of items (2) and (3),
such violation or breach could have a material and adverse effect on the ability
of Assignor to perform its obligations under the Agreement or the Note and (c)
will not conflict with, or result in a breach, violation or acceleration of, or
constitute a default under any material agreement to which Assignor is a party
or by which Assignor is bound.
To the best of counsel's knowledge, there is no action, suit,
proceeding or investigation before or by any court or governmental agency or
body, domestic or foreign, now pending or threatened against Assignor which
could reasonably be expected to interfere with or materially and adversely
affect the consummation of the transactions contemplated in this Agreement or
the Note.
Onyx is a corporation duly incorporated and validly existing
and in good standing under the laws of the State of Delaware and has the
corporate power and authority to execute, deliver and perform its obligations
under the Guarantee. Onyx is duly qualified to do business and is in good
standing in each jurisdiction in which the character of the business transacted
by it requires such qualification and in which the failure so to qualify would
have a material adverse effect on the business, properties, assets or condition
(financial or other) of Onyx and its subsidiaries, considered as a whole.
The Guaranty has each been duly authorized, executed and
delivered by Onyx, and constitutes a valid and legally binding obligation of
Onyx enforceable against Onyx in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights generally and to
general equity principles.
The execution, delivery and performance by Onyx of the
Guaranty (a) has been duly authorized by all necessary corporate action on the
part of Onyx, (b) does not and will
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not violate, or result in a breach of (1) the Certificate of Incorporation or
Bylaws of Onyx, (2) the provisions of the Delaware General Corporation Law, or
any California, New York or federal law, rule or regulation applicable to Onyx
(other than California, New York and federal securities laws, as to which
counsel expresses no opinion) or (3) to the best of counsel's knowledge, any
order of any court or other governmental authority to which Onyx is a party or
by which Onyx or any of its properties are bound or subject, where in the case
of items (2) and (3) above, such violation or breach could have a material and
adverse effect on the ability of Onyx to perform its obligations under the
Guaranty and (d) will not conflict with, or result in a breach, violation or
acceleration of, or constitute a default under any of the material agreements to
which Onyx is a party or by which it is bound.
To the best of counsel's knowledge, there is no action, suit,
proceeding or investigation before or by any court or governmental agency or
body, domestic or foreign, now pending or threatened against Onyx which could
reasonably be expected to interfere with or materially and adversely affect the
consummation of the transactions contemplated in the Guaranty.
Each Pledged ABS will have been endorsed in a manner which
satisfies any requirement of endorsement in order to transfer all right, title
and interest in and to that Pledged ABS from Assignor to MLMCI. This Agreement
together with (a) the delivery of such related Pledged ABS to MLMCI and (b) the
endorsement of such Pledged ABS to MLMCI, creates a valid, perfected security
interest in such Pledged ABS in favor of MLMCI. Such security interest will have
the same priority and will be subject to the same security interests and liens
as apply to such Pledged ABS in the hands of Assignor.
Assignor acquired each Pledged ABS in a true sale from Onyx.
In the event of an insolvency proceeding against Onyx, the
assets of Assignor would not be consolidated with those of Onyx.
Very truly yours,
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EXHIBIT D
LOCATION OF CHIEF EXECUTIVE OFFICES AND COLLATERAL
Chief Executive Office
----------------------
Onyx Acceptance Funding Corporation
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Collateral
With respect to any Loan, the Pledged ABS to be delivered to, and
held by, MLMCI or its bailee.
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EXHIBIT E
ONYX ACCEPTANCE CORPORATION
0000 XXXXXX XXXXXX XXXXX
XXXXX XXXXX
XXXXXX, XXXXXXXXXX 00000
February __, 1998
Xxxxxxx Xxxxx Mortgage Capital Inc.
Xxxxxxx Xxxxx World Headquarters
World Financial Center
Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
This letter will confirm that Onyx Acceptance Corporation, a
Delaware corporation ("Guarantor"), agrees to absolutely and unconditionally
guaranty to Xxxxxxx Xxxxx Mortgage Capital Inc. and any of its affiliates
(collectively, the "Beneficiary"), the full and prompt payment and performance
of the obligations, undertakings and liabilities of Onyx Acceptance Funding
Corporation, a Delaware corporation ("Assignor"), arising under the terms and
provisions of a Master Assignment Agreement (the "Agreement"), dated as of
February 4, 1998 by and between Assignor and Xxxxxxx Xxxxx Mortgage Capital Inc.
("MLMCI"), in an amount not to exceed 10% of the aggregate outstanding amount
owed by Assignor to MLMCI under the Agreement (such obligations, undertakings
and liabilities are herein referred to as the "Guarantied Obligations").
Guarantor hereby expressly consents to any amendment to the Agreement as may be
agreed upon by Assignor and MLMCI and waives notice of any such amendment. A
copy of the Agreement is attached hereto as Exhibit A. Capitalized terms used
and not otherwise defined herein shall have the meanings assigned in the
Agreement.
Guarantor hereby represents and warrants to you that Assignor
is a direct or an indirect wholly-owned subsidiary of Guarantor.
Guarantor hereby agrees that if Assignor shall fail at any
time to make due and punctual payment to the Beneficiary of any Guarantied
Obligation or if Assignor shall fail at any time to perform any other Guarantied
Obligation to the Beneficiary, Guarantor will forthwith pay such amount and
perform such obligation without demand therefor.
Guarantor covenants and agrees to immediately notify MLMCI if
a representation, warranty or covenant of Assignor under Agreement has been
breached or if an Event of Default shall have occurred.
Guarantor, to the extent consistent with applicable law,
hereby waives any requirement that the Beneficiary take legal action against
Assignor before enforcing this guaranty; agrees that its obligations hereunder
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Guarantied Obligations or the dissolution, liquidation,
reorganization or other change regarding the Assignor or the Assignor seeking
protection, or having a case or proceeding commenced against it, under any law
for the protection of debtors or creditors; waives diligence, presentment,
demand for payment or performance, protest or notice or other
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40
formality of any kind whatsoever; waives filing of claims with any court in case
of the insolvency, reorganization or bankruptcy of the Assignor; waives any
fact, event or circumstance that might otherwise constitute a legal or equitable
defense to or discharge of Guarantor, including (but without typifying or
limiting this waiver) failure by the Beneficiary to perfect a security interest
in any collateral securing performance of any Guarantied Obligation and any
delay by the Beneficiary in exercising any of its rights hereunder, Guarantor
covenants that this guaranty will not be discharged except by full and final
payment and performance to the Beneficiary of all Guarantied Obligations
incurred while it is effective, and agrees that this guaranty shall continue to
be effective or be reinstated (as the case may be) if at any time all or any
part of any payment or interest thereon or other performance by Assignor is
avoided or must otherwise be restored by the Beneficiary. Guarantor hereby
further consents to any renewal or modification of any Guarantied Obligation or
any extension of the time within which such is to be performed and to any other
indulgences, whether before or after the date of this guaranty.
Guarantor agrees to pay on demand all out-of-pocket expenses
(including legal fees and disbursements) incurred by the Beneficiary in
connection with the enforcement and protection of its rights hereunder.
This is a continuing guaranty and will remain in effect until
thirty (30) days after written notice of termination is received by Xxxxxxx
Xxxxx Mortgage Capital Inc., Xxxxxxx Xxxxx World Headquarters, World Financial
Center, Xxxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx X.
Xxxxxxxx. Any such termination shall not affect or reduce Guarantor's
obligations hereunder for any liability of Assignor that arose prior to the
expiration of said thirty-day period. This guaranty shall terminate and shall be
of no further force or effect upon full payment of all amounts due to MLMCI
under the Agreement. This guaranty shall inure to the benefit of any successor
of the Beneficiary and be binding on any successor or assignee of Guarantor.
This guaranty shall be governed by and construed in accordance
with the laws of the State of New York. Guarantor hereby agrees that (i) any
dispute or controversy arising out of or relating to this guaranty, the
Agreement or the Note shall be submitted to arbitration before the American
Arbitration Association, (ii) the arbitration proceedings shall be conducted in
New York, New York and (iii) the decision of the arbitrators shall be final and
judgment may be entered on the award. In the event that such arbitration is
unavailable, Guarantor hereby submits to the jurisdiction of the United States
Federal and New York State courts situated in the City, County, and State of New
York and hereby agrees that any litigation arising out of or relating to this
guaranty, the Agreement or the Note shall be brought in such courts. Each
provision and agreement herein shall be treated as separate and independent from
any other provision or agreement herein and shall be enforceable notwithstanding
the non-enforceability of any such other provision or agreement.
Any demand by MLMCI for payment or performance by Guarantor
shall be by a written demand to Guarantor, which shall be deemed to have been
duly given if made by facsimile transmission to Onyx Acceptance Corporation,
0000 Xxxxxx Xxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000, Attention: Xxx
X. Xxxxx, Phone: (000) 000-0000, Fax: (000) 000-0000 or if personally delivered
at or upon the fifth day after deposit in the mails, mailed by registered mail,
postage prepaid, to Onyx Acceptance Corporation, 0000 Xxxxxx Xxxxxx Xxxxx, Xxxxx
Xxxxx, Xxxxxx, Xxxxxxxxxx 00000, Attention: Xxx X. Xxxxx.
Very truly yours,
ONYX ACCEPTANCE CORPORATION
By: _________________________
Name: _______________________
Title: ______________________
X-0
00
XXXXXXX X
MONTHLY COLLATERAL REPORT
INDEX DELINQUENCY
Issuer STATUS
Account Number (Current/Delinq/Fcir/REO)
Last Pay Date
SECURITIZATION INFO Months Delinquent
Deal 24 Months Status History
(ie CCCCCCC369CC369999FFFRRR)
LOAN ATTRIBUTES
Loan Type DEFAULT
Original Balance Defaulted Amount
Origination Date Liquidation Loss Amount
Maturity Date Default Date
Zip Code
County PREPAYMENT
State Prepay Amount
WAC Prepay Penalty Paid
XXX Xxxxx Xxxxxx Xxxx
XXX Xxx
X&X ARM SPECIFIC
Current Balance Next IA Date
CLTV Reset Frequency
Property Type Margin
Occupancy Status Index
Loan Purpose Caps/Floors
Documentation Periodic Cap
Balloon Life Cap
Lien Life Floor
2nd Lien Ratio
Prepay Penalty Schedule
(ie 3yr penalty - 6mo interest)
Servicer
Loan Source (Retail/Corresp/Wholesale)
BORROWER INFORMATION
FICO Score
Credit Grade
DTI
F-1
