Exhibit 10.1
THIRD AMENDMENT TO CREDIT AGREEMENT
This THIRD AMENDMENT TO CREDIT AGREEMENT is made and entered into as of
July 14, 2003 (as it may be modified, supplemented or amended from time to time
in accordance with its terms, this "AMENDMENT") by and among E-LOAN AUTO FUND
ONE, LLC, a Delaware limited liability company (the "BORROWER"), E-LOAN, INC., a
Delaware corporation (the "E-LOAN"), and XXXXXXX XXXXX BANK USA, an industrial
loan company organized under the laws of Utah (together with its successors and
assigns, the "LENDER").
BACKGROUND
WHEREAS, the Borrower, E-Loan and the Lender entered into a Credit
Agreement dated as of June 1, 2002, as amended by the First Amendment dated as
of June 16, 2002 and as amended by the Second Amendment dated as of June 3, 2003
(as further amended, supplemented and otherwise modified, the "EXISTING CREDIT
AGREEMENT"), pursuant to which the Lender extended financing to the Borrower on
the terms and conditions set forth therein;
WHEREAS, the parties to the Existing Credit Agreement desire to amend the
Existing Credit Agreement to, INTER ALIA (i) extend the Commitment Expiration
Date, (ii) amend and restate Section 8.1 in its entirety and (iii) to add
certain reporting requirements;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto agree as follows:
SECTION 1. DEFINED TERMS. Capitalized terms used in this Amendment and
not otherwise defined herein shall have the meanings assigned to them in the
Existing Credit Agreement.
SECTION 2. AMENDMENT. Effective upon the execution and delivery of this
Amendment:
(a) Section 2.4.2 of the Existing Credit Agreement shall be amended
and restated in its entirety as follows:
The Borrower shall repay to the Lender, in respect of the outstanding Aggregate
Loan Balance, on each Payment Date (x) all Principal Collections and the
principal portion of any and all Recoveries and (y) any Principal Shortfall.
From and after the occurrence of an Event of Default, all amounts on deposit in
the Collection Account as of the last day of the immediately preceding Monthly
Period, after payment of amounts then due and payable pursuant to clauses (a)
through (c) of Section 8.1, shall be applied against the entire outstanding
Aggregate Loan Balance (whether or not such principal is then due).
(b) Section 2.5.1 of the Existing Credit Agreement is hereby amended
and supplemented by adding the following sentence as the penultimate sentence
thereof:
Upon delivery by the Borrower or the Administrator to the Lender of an
irrevocable notice to be delivered not less than five (5) Business Days prior to
the proposed date of such repayment, the Borrower shall have the right to repay
on any Payment Date from and after the Commitment
Expiration Date, in immediately available funds, the entire then outstanding
principal of all Advances together with any and all accrued and unpaid interest
thereon, any and all amounts due and payable under each Hedge Agreement, and any
and all other amounts due and payable in respect of the Obligations (for the
avoidance of doubt, after payment in full of such amounts, the Lender shall have
no right to exercise any Call Option in respect of the Receivables securing such
Advances or to direct the sale of the Receivables securing such Advances
pursuant to Section 2.8).
(c) the proviso in clause (b) of Section 2.5.2 of the Existing Credit
Agreement shall be amended and restated in its entirety as follows:
; PROVIDED that such release will not result in either (x) the Aggregate Loan
Balance on such day of repayment being greater than the Credit Facility Limit on
such day or (y) the Aggregate Loan Balance on such day of repayment being
greater than the Target Loan Balance on such day.
(d) the phrase "together with any Breakage Fee then payable" in
Section 2.5.3 of the Exiting Credit Agreement is hereby deleted in its entirety.
(e) the parenthetical phrase "(including any Breakage Fee)" in each of
Section 2.5.4 and Section 2.6.3 of the Existing Credit Agreement is hereby
deleted in its entirety.
(f) each of the reference to "Breakage Fee" in Section 3.2 of the
Existing Credit Agreement and the reference to "Breakage Fee(s)" in Section 3.6
of the Existing Credit Agreement is hereby deleted.
(g) Section 7.1.1(y) of the Existing Credit Agreement shall be amended
and restated in its entirety as follows:
two Business Days prior to each Payment Date, the Borrower shall deliver (or
cause to be delivered) to the Lender and the Servicer, in both written and
electronic format, (i) a Monthly Servicer Report (in the form of Exhibit F and
which will contain, among other things, the performance of the Collateral by
Tranche), and (ii) a Schedule of Contracts (in electronic format as Appendix A)
corresponding to the Eligible Contracts comprising the Collateral pledged to the
Lender, listing by Tranche and Obligor all Receivables together with a report
setting forth the delinquency status of each receivable in a form acceptable to
the Lender and (iii) a Monthly Distribution Statement to be certified by an
officer of each of the Administrator and the Borrower;
(h) the Existing Credit Agreement shall be amended and supplemented by
adding the following Section 7.1.1(ee):
(ee) as of any date of determination, not more than five percent (5%) of the
Aggregate Outstanding Balance is comprised of Contracts originated in
person-to-person transactions.
(i) the Existing Credit Agreement shall be amended and supplemented by
adding the following Section 7.1.1(ff):
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(ff) as of any date of determination, not more than two percent (2%) of the
Aggregate Outstanding Balance is comprised of Vehicles that are
motorcycles.
(j) the Existing Credit Agreement shall be amended and supplemented by
adding the following Section 7.1.2:
In order to induce the Lender to make Advances on the terms and conditions set
forth in this Agreement, in connection with the first Six Hundred Million
Dollars ($600,000,000) of Receivables subject to one or more Securitizations,
each of E-Loan, Inc. and the Borrower agrees to pay, or cause to be paid, to the
Lender, on each payment date of each such Securitization, an amount equal to the
product of (x) five percent (5%), (y) the residual distribution of the issuer
under each such Securitization and (z) the Lender's Residual Percentage of such
Securitization. The Borrower, E-Loan, Inc. and the Lender shall structure each
such Securitization so that the residual distribution will not represent any
overcollateralization (which shall be the difference between the principal
balance of the Receivables included in such Securitization minus the original
principal balance of the asset-backed securities collateralized by such
Receivables). This Section 7.1.2 shall survive the termination of this Agreement
and the repayment of the Obligations.
(k) SECTION 8.1 of the Existing Credit Agreement shall be amended and
restated in its entirety as follows:
The Borrower shall hold (or cause to be held) in the Collection Account any and
all amounts deposited therein from time to time in trust for the Lender and
shall not withdraw any amount from the Collection Account, other than (i) any
amount which is not contemplated to be deposited into the Collection Account
pursuant to the terms of this Agreement and the other Credit Documents and (ii)
in accordance with this Section 8.1. The Borrower and the Lender hereby agree
that, pursuant to the Administration Agreement, the Administrator shall apply
(or cause to be applied) the monies on deposit in the Collection Account as of
the last day of the immediately preceding Monthly Period (including, for greater
certainty, any interest earned thereon and credited to the Collection Account)
on each Payment Date (unless otherwise specifically stated below) as follows and
as may be more particularly set forth in the related Monthly Distribution
Statement:
(a) first, to each Hedge Counterparty, PRO RATA, any payments, if any,
due under any Hedge Agreement;
(b) second, to the Servicer, the Custodian and the Administrator, PRO
RATA, the Servicing and Custodian Fee and the Administrator Fee,
respectively;
(c) third, to the Lender Account (or as the Lender may otherwise
direct in writing to the Borrower and the Administrator), an
amount equal to all interest on each related Advance which has
accrued hereunder for the related Interest Period and which is due
or remains unpaid on such Payment Date;
(d) fourth, to the Lender Account (or as the Lender may otherwise
direct in writing to the Borrower and the Administrator) any and
all Principal Collections, the principal portion of any and all
Recoveries, and other amounts (other than
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Principal Shortfalls) that the Borrower is required to or has
agreed to make pursuant to Section 2.4 or Section 2.5, as
applicable, to the extent not already paid by or on behalf of the
Borrower;
(e) fifth, to the Lender Account (or as the Lender may otherwise
direct in writing to the Borrower and the Administrator), PRO RATA
among all Tranches based on the Outstanding Tranche Collateral
Balance as of the last day of the previous Monthly Period, the
Principal Shortfall, if any;
(f) sixth, to the Servicer, the Custodian and the Administrator, PRO
RATA, any and all amounts due and payable under the Servicing and
Custodian Agreement or the Administration Agreement
(respectively), to the extent not already paid hereunder or by or
on behalf of the Borrower;
(g) seventh, to the Borrower (or as the Borrower may otherwise direct
in writing to the Administrator), any Servicing Fee Savings
Amount; and
(h) eighth, (x) to the extent of any proceeds from any Securitization
in excess of the net payoff amount therefor or the proceeds of any
whole loan sale in accordance with this Agreement or in connection
with any prepayment of the entire outstanding principal balance of
all Advances pursuant to Section 2.5.1, to the Borrower's Account
(or as the Borrower may otherwise direct in writing to the
Administrator), any balance remaining in the Collection Account
and (y) to the Borrower or its assignee and the Lender, PRO RATA,
the Borrower's Percentage of any balance remaining in the
Collection Account to the Borrower's Account (or as the Borrower
may otherwise direct in writing to the Administrator) and the
Lender's Percentage of any balance remaining in the Collection
Account to the Lender's Account (or as the Lender may otherwise
direct in writing to the Borrower and the Administrator); PROVIDED
that (1) after the occurrence of an Event of Default, no amount
shall be paid to the Borrower from the Collection Account until
such time as the Obligations are repaid in full and until such
payment in full, all amounts in the Collection Account shall be
paid to the Lender on account of the Obligations and (2) during
the continuance of a Pending Event of Default, all amounts payable
to the Borrower pursuant to this Section 8.1(g) shall be held on
deposit in the Collection Account for application on the
immediately following Payment Date pursuant to Section 8.1.
(l) The proviso set forth in the second sentence of Section 12.7.1 is
hereby amended and restated in its entirety as follows:
; PROVIDED that, prior to the occurrence or continuance of a Pending Event of
Default, Event of Default or Servicer Default, the Borrower shall not be
required to reimburse the Lender for more than $50,000 per annum for any fees
and expenses in connection with any inspections pursuant to Section 7.1.1(q) of
this Agreement.
(m) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
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"30+ DAY DELINQUENCY TRIGGER EVENT" means for a period of two consecutive
months or more, either (i) the 30+ Day Delinquency Ratio for any Tranche shall
exceed 1.5% for one or more Tranches with an aggregate Outstanding Tranche
Collateral Balance of more than 25% of the Aggregate Outstanding Balance, which
excess shall remain uncured for a period of one month or more, or (ii) the
aggregate Outstanding Tranche Collateral Balance of all 30+ Day Delinquent
Contracts in any one Tranche shall exceed 2.5% of the Outstanding Tranche
Collateral Balance of such Tranche. Such excess shall be deemed to have been
cured if, for a period of at least three consecutive months from and after the
occurrence of such 30+ Day Delinquency Trigger Event (i) the 30+ Day Delinquency
Ratio for each Tranche does not exceed 1.5% for each Tranche with an aggregate
Outstanding Tranche Collateral Balance of more than 25% of the Aggregate
Outstanding Balance and (ii) the aggregate Outstanding Tranche Collateral
Balance of all 30+ Day Delinquent Contracts in any one Tranche does not exceed
2.5% of the Outstanding Tranche Collateral Balance of such Tranche.
(n) the defined term "Administrator Fee" in Schedule A of the Existing
Credit Agreement is hereby amended and restated in its entirety as follows:
"ADMINISTRATOR FEE" means the compensation payable to the Administrator
for its services under the Administration Agreement and for its service in
providing on each Payment Date the duly completed Monthly Distribution
Statement, which amount shall not exceed $2,000 per month.
(o) the defined term "Annualized Net Loss" in Schedule A of the
Existing Credit Agreement is hereby amended and restated in its entirety as
follows:
"ANNUALIZED NET LOSS" means, with respect to any Tranche, an amount equal
to the product of (i) 12 and (ii) the quotient of (x) the Cumulative Net Losses,
divided by (y) the number of months elapsed since the issuance of such Tranche.
(p) the defined term "Annualized Net Loss Ratio" in Schedule A of the
Existing Credit Agreement is hereby amended and restated in its entirety as
follows:
"ANNUALIZED NET LOSS RATIO" means, with respect to any Tranche, the ratio
of (x) the amount of all Annualized Net Losses with respect to such Tranche, to
(y) the quotient of (i) the sum of the current Outstanding Tranche Collateral
Balance and the Original Tranche Collateral Balance, divided by (ii) two (2).
(q) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"BORROWER'S PERCENTAGE" means, for each Payment Date, an amount equal to
(x) 100% minus (y) the Lender's Percentage for such Payment Date.
(r) the defined term "Commitment Expiration Date" in Schedule A of the
Existing Credit Agreement is hereby amended and restated in its entirety as
follows:
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"COMMITMENT EXPIRATION DATE" means July 13, 2005 (unless otherwise
extended by the Lender in its sole discretion in accordance with the terms and
conditions of Section 2.1 of the Credit Agreement).
(s) the defined term "Credit Facility Limit" in Schedule A of the
Existing Credit Agreement is hereby amended and restated in its entirety as
follows:
"CREDIT FACILITY LIMIT" means an amount equal to Eight Hundred Million
Dollars ($800,000,000).
(t) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"CUMULATIVE NET LOSSES" means, as of any date of determination, with
respect to a Tranche, the difference between (i) the aggregate amount of all
Defaulted Receivables in such Tranche and (ii) any Recoveries in respect of the
Defaulted Receivables in such Tranche.
(u) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"CUMULATIVE NET LOSS RATIO" means, with respect to a Tranche, the ratio
of Cumulative Net Losses for such Tranche to the aggregate Original Tranche
Collateral Balance of such Tranche.
(v) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"CUMULATIVE NET LOSS RATIO EXCESS" means, for any Tranche, as of any date
of determination, the Cumulative Net Loss Ratio of such Tranche exceeds the
amount set forth in Column B of Exhibit 1 for the related month of seasoning of
such Tranche set forth in Column A of Exhibit 1.
(w) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"CUMULATIVE NET LOSS TRIGGER EVENT" means for a period of two consecutive
months or more, an event or condition with respect to all such Tranches
determined to have a Cumulative Net Loss Ratio Excess, where the quotient of (x)
the sum of the current Outstanding Tranche Collateral Balances of all such
Tranches, divided by (y) the Aggregate Outstanding Balance of all Tranches,
shall be equal to or greater than fifty percent (50%). Such excess shall be
deemed to have been cured if, for a period of at least three consecutive months
from and after the occurrence of such Cumulative Net Loss Trigger Event, the
quotient of (x) the sum of the current Outstanding Tranche Collateral Balances
of all Tranches determined to have a Cumulative Net Loss Ratio Excess, divided
by (y) the Aggregate Outstanding Balance of all Tranches, is less than fifty
percent (50%).
(x) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
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"LENDER'S PERCENTAGE" means, for each Payment Date, an amount equal to
the product of (x) the quotient of (i) the Outstanding Balance of all Shared
Distribution Receivables as of the last day of the immediately preceding Monthly
Period, divided by (ii) the Aggregate Outstanding Balance as of the last day of
the immediately preceding Monthly Period, multiplied by (y) fifteen percent
(15%).
(y) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"LENDER'S RESIDUAL PERCENTAGE" means, with respect to any Securitization,
a percentage equal to the lesser of (a) 100% and (b) the quotient (expressed as
a percentage) of (i) Six Hundred Million Dollars ($600,000,000) minus the sum of
the principal balances of all Receivables subject to all Securitizations closing
prior to the date of such Securitization, divided by (ii) the principal balance
of all Receivables subject to such Securitization; provided, however, that if
the difference calculated pursuant to clause (i) above is a negative number,
then clause (i) shall be deemed to be zero.
(z) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"MONTHLY DISTRIBUTION STATEMENT" means a statement created by the
Administrator for each Payment Date which shall detail the amounts to be paid
pursuant to Section 8.1 and shall also provide a covenant compliance summary
together with all supporting documentation regarding the information described
therein, in each case in a form and substance satisfactory to the Lender,
setting forth the status of each of the Trigger Events and the covenants
contemplated by Sections 2.6.2, 3.7(d), 7.1.1(dd), 7.1.1(ee), 7.1.1(ff),
7.2.1(u), 7.2.1(v), 7.2.1(w), 7.2.1(x), 7.3(b), 7.3(c), 7.3(e) and 7.3(f) of
this Agreement and items (viii) and (xv) of Schedule J of this Agreement, in
each case as of the last day of the immediately preceding Monthly Period.
(aa) the defined term "Outstanding Tranche Collateral Balance" in
Schedule A of the Existing Credit Agreement is hereby amended and restated in
its entirety as follows:
"OUTSTANDING TRANCHE COLLATERAL BALANCE" means, as of the related date of
calculation, with respect to the Receivables forming part of the Related Tranche
Collateral for any Tranche, the aggregate Outstanding Balance of all such
Receivables forming part of such Related Tranche Collateral on such day less the
aggregate principal balance of all Defaulted Receivables forming part of such
Related Tranche Collateral on such day. With respect to any calculation of the
covenants set forth in clauses (u) through (x) of Section 7.2.1, the related
date of calculation shall be the last day the immediately preceding Monthly
Period.
(bb) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"PRINCIPAL COLLECTIONS" means, with respect to each Monthly Period, all
Collections in respect of principal paid by or on behalf of an Obligor.
(cc) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
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"PRINCIPAL SHORTFALL" means, for each Payment Date, an amount equal to
the excess (if any) between (i) the Aggregate Loan Balance as of the last day of
the immediately preceding Monthly Period after giving effect to Principal
Collections and Recoveries applied according to Section 8.1(d) on the current
Payment Date and (ii) the Target Loan Balance.
(dd) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"RECOVERIES" means, with respect to any Receivable that has become a
Defaulted Receivable, all monies collected by E-Loan, Inc., the Servicer, the
Borrower or the Administrator (from whatever source, including but not limited
to proceeds of a deficiency balance or insurance proceeds) on such Defaulted
Receivable, net of any expenses incurred by the Servicer in connection therewith
and any payments required by law to be remitted to the Obligor.
(ee) the defined term "Servicing and Custodian Fee" in Schedule A of
the Existing Credit Agreement is hereby amended and restated in its entirety as
follows:
"SERVICING AND CUSTODIAN FEE" has the meaning attributed to such term in
the Servicing and Custodian Agreement, and which, in any event shall not exceed
on each Payment Date an amount equal to the product of (i) 0.50%, (ii) 1/12 and
(iii) the Aggregate Outstanding Balance as of the last day of the immediately
preceding Monthly Period.
(ff) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"SERVICING FEE SAVINGS AMOUNT" means, for each Payment Date, an amount
equal to the excess (if any) of (a) the product of (i) 0.50%, (ii) 1/12 and
(iii) the Aggregate Outstanding Balance as of the last day of the immediately
preceding Monthly Period over (b) the amount of the Servicing and Custodian Fee
actually paid to the Servicer (and the Custodian, if applicable) on such Payment
Date pursuant to the Servicing and Custodian Agreement.
(gg) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"SHARED DISTRIBUTION RECEIVABLES" means all Receivables representing the
first $800,000,000 of Receivables that have not become Defaulted Receivables
(based on Original Tranche Collateral Balance) and have been pledged under the
Credit Agreement.
(hh) clause (d) of the defined term "Sold Assets" in Schedule A of the
Existing Credit Agreement is hereby amended and restated in its entirety as
follows:
(d) any agreements in connection with a person-to-person transaction,
a Dealer, an Eligible Non-Franchise Dealer or manufacturer of a Financed Vehicle
to the extent any such agreement relates to such Financed Vehicle and any
payments, income and proceeds from recourse to person-to-person transaction,
Dealers, Eligible Non-Franchise Dealers or manufacturers with respect to the
Receivables; and
(ii) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
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"TARGET LOAN BALANCE" means, for each Payment Date, the product of (x)
the Aggregate Outstanding Balance as of the last day of the immediately
preceding Monthly Period and (y) if no Trigger Event has occurred and is
continuing, then Ninety-Nine and One-Half Percent (99.5%) or, if a Trigger Event
has occurred and is continuing, then Ninety-Eight and One-Half Percent (98.5%).
(jj) clause (iii) of the defined term "Termination Date" in Schedule A
of the Existing Credit Agreement is hereby amended and restated in its entirety
as follows:
(iii) [reserved],
(kk) Schedule A of the Existing Credit Agreement shall be amended and
supplemented by adding the following defined term in appropriate alphabetical
order:
"TRIGGER EVENT" means (i) a 30+ Day Delinquency Trigger Event or (ii) a
Cumulative Net Loss Trigger Event.
(ll) the defined term "Vehicle" in Schedule A of the Existing Credit
Agreement is hereby amended and restated in its entirety as follows:
"VEHICLE" means a new or used motorcycle, passenger automobile, sport
utility vehicle, light-duty truck, van or minivan which has been purchased or
financed by an Obligor pursuant to the provisions of a Contract.
(mm) Schedule J of the Existing Credit Agreement is hereby amended and
restated in its entirety in the form attached hereto as Schedule J.
(nn) the Existing Credit Agreement is hereby amended and supplemented
by adding Schedule I-a in appropriate order and in the form attached hereto as
I-a.
(oo) the Existing Credit Agreement is hereby amended and supplemented
by adding Exhibit 1 in the form attached hereto as Exhibit 1.
SECTION 3. CONDITIONS PRECEDENT. The effectiveness of this Amendment is
subject to (a) the due authorization, execution and delivery by the parties
hereto of this Amendment (including, without limitation, the acknowledgment and
agreement by Systems & Services Technologies, Inc.) and (b) the due
authorization, execution and delivery by the parties to the Third Amendment to
the Loan Agreement, dated July 14, 2003, between E-Loan, Inc. and Xxxxxxx Xxxxx
Mortgage Capital Inc.
SECTION 4. REPRESENTATIONS, WARRANTIES & COVENANTS. (a) The Borrower
hereby confirms that each of its representations, warranties and covenants set
forth in the Existing Credit Agreement, as amended by this Amendment, are true
and correct as of the date first written above with the same effect as though
each had been made as of such date, except to the extent that any of such
representations, warranties or covenants expressly relate to earlier dates.
Except as expressly amended by the terms of this Amendment, all terms and
conditions of the Credit Agreement and the other Credit Documents shall remain
in full force and effect and E-Loan and the Borrower hereby ratify their
respective obligations thereunder.
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(b) The Borrower confirms that as of the date hereof its obligations
under the Existing Credit Agreement, as amended by this Amendment, and the other
Credit Documents are in full force and effect and are hereby ratified. The
Borrower represents and warrants that (i) the Termination Date has not occurred
and no Pending Event of Default or Event of Default has occurred, (ii) it has
the power and is duly authorized to execute and deliver this Amendment, (iii)
this Amendment has been duly authorized, executed and delivered and constitutes
the legal, valid and binding obligation of it enforceable against it in
accordance with its terms, (iv) it is and will continue to be duly authorized to
perform its obligations under this Amendment and the other Credit Documents, (v)
the execution, delivery and performance by it of this Amendment does not and
will not require any consent or approval, which has not already been obtained,
from any Governmental Authority, equity owner or any other Person, and (vi) the
execution, delivery and performance by it of this Amendment shall not result in
the breach of, or constitute a default under, any material agreement or
instrument to which it is a party.
SECTION 5. SEVERABILITY. Any provision of this Amendment which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Amendment or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 6. GOVERNING LAW. THIS AMENDMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO CONFLICT OF LAW PRINCIPLES; PROVIDED, THAT SECTIONS 5-1401 AND 5-1402 OF THE
NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
SECTION 7. MISCELLANEOUS.
(a) The parties hereto hereby agree that the amendments set forth in
this Amendment shall be incorporated into the Existing Credit Agreement. This
Amendment constitutes the entire agreement concerning the subject matter hereof
and supercedes any and all written and/or oral prior agreements, negotiations,
correspondence, understandings and communications.
(b) Any reference to the Existing Credit Agreement from and after the
date hereof shall be deemed to refer to the Existing Credit Agreement as amended
hereby, unless otherwise expressly stated.
(c) This Amendment shall be binding upon and shall be enforceable by
parties hereto and their respective successors and permitted assigns.
(d) This Amendment may be executed by the parties hereto in several
counterparts, each of which shall be deemed to be an original but all of which
shall constitute together but one and the same agreement.
(e) The headings appearing in this Amendment are included solely for
convenience of reference and are not intended to affect the interpretation of
any other provision of this Amendment.
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SECTION 8. PERFECTION OPINION. The Borrower acknowledges and agrees that
(x) the Lender may require an opinion of counsel, in form and substance
satisfactory to the Lender and its counsel, that all filings, registrations and
recordings to perfect the security interest of the Lender in the Collateral in
all offices and in all jurisdictions where required by applicable law to do so
have been duly made on a timely basis (the "Perfection Opinion"), and (y)
although the Lender is not requiring delivery of a Perfection Opinion in
connection with the extension of the Commitment Termination Date pursuant to
this Amendment, no course of dealing shall be implied and the Lender, without
prejudice, reserves the right to require such Perfection Opinion.
SECTION 9. SECTION 4.2(H) OF CONTRIBUTION AND SALE AGREEMENT. The parties
hereby agree that Section 4.2(h) of the Contribution and Sale Agreement is
hereby deleted in its entirety.
[signature page follows.]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective officers thereunto duly authorized as of the day and year
first above written.
E-LOAN AUTO FUND ONE, LLC, as Borrower
By: /s/ Xxxx Xxxxxxx
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Name: Xxxx Xxxxxxx
Title: Treasurer
E-LOAN, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: President
XXXXXXX XXXXX BANK USA, as Lender
By: /s/ Xxxxxx Xxxxxx
----------------------------------
Name: Xxxxxx Xxxxxx
Title: Director
ACKNOWLEDGED AND AGREED:
SYSTEMS & SERVICES TECHNOLOGIES,
INC., as Servicer and Custodian
By: /s/ Xxxxxx Xxxx
----------------------------------
Name: Xxxxxx Xxxx
Title: EVP/Secretary
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SCHEDULE J
ELIGIBILITY CRITERIA
The following are the eligibility criteria applicable to each Contract on the
applicable Drawdown Date:
(i) arises from the financing or refinancing by Seller in the
ordinary course of Seller's business of an Obligor's purchase or
refinancing of a motor vehicle (a) within thirty (30) days of
the related Transfer Date or (b) more than two hundred forty
(240) days of the related Transfer Date if the Contract was
previously repurchased by the Seller as a result of the Seller's
failure to obtain a certificate of title indicating the lien of
the Seller thereon and the Seller subsequently received such
certificate of title;
(ii) in the case of a purchase, is subject to a Dealer Agreement
requiring each Dealer and Eligible Non-Franchise Dealer to
supply documentation as set forth therein; and in the case of a
refinancing or a person-to-person transaction, is evidenced by a
Note and Security Agreement, power of attorney for the Borrower
and draft endorsed by the prior lender/lienholder acknowledging
the release of its lien on the related Vehicle and, with respect
to person-to-person transactions, that the transaction complies
with the underwriting procedures set forth in Schedule I-a;
(iii) represents a valid and binding obligation enforceable in
accordance with its terms (except as enforcement of such terms
may be limited by bankruptcy, insolvency, moratorium or other
similar laws affecting the rights of creditors generally and by
equitable principles (regardless of whether such enforceability
is in a proceeding in equity or at law)) for the amount
outstanding thereof without offset, counterclaim or defense
(whether actual or alleged) and is not subject to rescission;
(iv) complies in all respects with applicable Law, including, without
limitation, usury, truth in lending and credit disclosure laws
and regulations;
(v) is secured by a first priority security interest in and lien on
the Financed Vehicle and Lender has been granted a first
priority perfected Lien on such security interest of Seller and
a first priority perfected Lien on the Contract and the Contract
is free and clear of any liens or claims of any other Person;
(vi) the Obligor thereon is not subject to any pending receivership,
insolvency or bankruptcy proceeding and the related Financed
Vehicle has not been repossessed;
(vii) the Obligor thereon is not an Affiliate of Seller;
(viii) the Obligor thereunder has a FICO score of at least 640,
PROVIDED that when considered with all other Contracts then
owned by the Borrower (including those
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Contracts to be transferred in any transfer then under
consideration) no more than fifteen percent (15%) of the then
outstanding aggregate principal balance of the Contracts shall
be to Obligors that have a FICO score between 640 and 679, and
no less than fifty percent (50%) of the then outstanding
aggregate principal balance of the Contracts shall be to
Obligors that have a FICO score of at least 720;
(ix) when considered with all other Contracts then owned by the
Borrower (including those Contracts to be transferred in any
transfer then under consideration) no Contracts (x) arising in
connection with the purchase of a Financed Vehicle related to
any Tranche shall be to Obligors that have a FICO score between
640 and 669 and have a Loan-to-Value Ratio of greater than 130%
or Obligors that have a FICO score between 670 and 699 and have
a Loan-to-Value Ratio of greater than 150% and (y) arising in
connection with the refinancing (as opposed to the purchase) of
a Financed Vehicle related to any Tranche shall be to Obligors
that have a FICO score between 640 and 699 and have a
Loan-to-Value Ratio of greater than 150%;
(x) the Obligor has accepted delivery of and is in possession of the
related Financed Vehicle and such Vehicle has not been returned
to the related seller in a person-to-person transaction (or any
secured party thereof), Dealer or Eligible Non-Franchise Dealer
by the Obligor;
(xi) the first payment thereunder is, or was, due within forty-five
(45) days of the Contract's origination;
(xii) all payments under the Contract are current;
(xiii) the terms and provisions thereof have not been amended, modified
or extended;
(xiv) is not related to a Defaulted Receivable;
(xv) when considered with all other Contracts then owned by the
Borrower (including those Contracts to be transferred in any
transfer then under consideration) no more than (i) twenty
percent (20%) of the then outstanding aggregate principal
balance of the Contracts related to any Tranche included in this
definition of "Eligible Contracts" shall be to Obligors that
have a FICO score of less than 720 and the related Contract
provides for greater than 60 monthly payments, (ii) twenty
percent (20%) of the then outstanding aggregate principal
balance of the Contracts related to any Tranche included in this
definition of "Eligible Contracts" shall be to Obligors that
have a FICO score of less than 720 and such Contract arises in
connection with the refinancing (as opposed to the purchase) of
a Financed Vehicle and (iii) five percent (5%) of the then
outstanding aggregate principal balance of the Contracts related
to any Tranche included in this definition of "Eligible
Contracts" shall be to Obligors that have a FICO score of less
than 720, the related Contract provides for greater than 60
monthly payments and such Contract arises in connection with the
refinancing (as opposed to the
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purchase) of a Financed Vehicle; PROVIDED that in no event shall
any Contract included in this definition of "Eligible Contract"
be for a cash-out refinancing;
(xvi) in no event shall any Contract included in this definition of
"Eligible Contract" be for an amount greater than $100,000;
(xvii) [reserved];
(xviii) when considered with all other Contracts then owned by the
Borrower (including those Contracts to be transferred in any
transfer then under consideration) no Contract shall have a
Payment-to-Income Ratio of more than 25% for Obligors with a
FICO score greater than 700 and a Payment-to-Income Ratio of
more than 20% for all other Obligors;
(xix) has been originated in compliance with the General Underwriting
Criteria (attached as Exhibit G to the Loan Agreement);
(xx) accrues interest based on the simple interest method;
(xxi) all payments thereunder are level payments; PROVIDED, HOWEVER,
the first or the last monthly payment thereunder may be in an
amount up to 10% greater than the level payment amount therefor;
(xxii) at the stated interest rate, the monthly scheduled level
payments cause the original loan balance to amortize to zero;
(xxiii) bears a fixed rate of interest;
(xxiv) is not the subject of an uncured reversal of funds transfer from
its related seller under the person-to-person transaction (or
any secured party thereof), Dealer or Eligible Non-Franchise
Dealer to the Seller pursuant to a Dealer Agreement;
(xxv) if the Obligor has a FICO score of less than 700, the model year
of the related Financed Vehicle shall not be greater than eight
(8) years prior to the year in which the applicable Drawdown
Date occurs; PROVIDED that if the Obligor related to such
Financed Vehicle has a FICO score of less than 700 and the
related Contract provides for greater than 60 monthly payments,
then the model year of the related Financed Vehicle shall not be
more than four (4) years older than the current model year;
PROVIDED further that if the Obligor related to such Financed
Vehicle has a FICO score of less than 700, the related Contract
provides for greater than 60 monthly payments and such Contract
arises in connection with the refinancing (as opposed to the
purchase) of a Financed Vehicle, then the model year of the
related Financed Vehicle shall not be more than three (3) years
older than the current model year;
(xxvi) for Obligors with a FICO score less than 700, the mileage of the
related Financed Vehicle shall not be greater than 100,000
miles;
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(xxvii) does not permit the early termination or prepayment thereof at
the option of the related Obligor for an amount that is less
than the Discounted Contract Balance thereof (in the case of a
full prepayment or early termination) or the related portion of
the Discounted Contract Balance thereof (in the case of a
partial prepayment);
(xxviii) in connection with any Obligor's refinancing of a motor vehicle,
the Seller (x) has verified the vehicle identification number of
the Financed Vehicle and that the Obligor is the owner of the
Financed Vehicle and (y) on the related Drawdown Date, shall pay
the refinanced amount under the related Contract directly to the
prior lender;
(xxix) after giving effect to the related Advance, except for the
ninety (90) day period following the Closing Date, not more than
five percent (5%) of the Aggregate Outstanding Balance is
transactions originated with Eligible Non-Franchise Dealers that
are not any of CarMax, AutoNation, Enterprise and each other
Person mutually agreed upon by the Lender and the Borrower;
(xxx) after giving effect to the related Advance, not more than two
percent (2%) of the Aggregate Outstanding Balance is comprised
of Vehicles that are motorcycles;
(xxxi) each Eligible Non-Franchise Dealer has been approved based on
the Non-Franchise Dealer Procedures attached as Exhibit B to the
Contribution and Sale Agreement;
(xxxii) after giving effect to the related Advance, not more than five
percent (5%) of the Aggregate Outstanding Balance is comprised
of Contracts originated in person-to-person transactions; and
(xxxiii) with respect to all Contracts where the Obligor may purchase the
vehicle with a draft payable upon demand, the Lender shall have
approved in advance the form of such draft and the procedures
for the issuance and disbursement of amounts payable pursuant to
such draft.
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EXHIBIT I-A
PERSON-TO-PERSON UNDERWRITING POLICIES AND PROCEDURES
1. UNDERWRITING
Each loan application presented to E-LOAN will be underwritten in the same
manner and policies as a Purchase or Refinance loan.
The approval will be provided with a minimum and maximum dollar amount in which
to purchase a vehicle from a private party.
The approved applicant can only use the loan proceeds to purchase one vehicle
from a private party and the amount cannot include license, title, registration
fees and use tax (these fees are paid directly to the appropriate state DMV by
the customer). E-LOAN is not responsible for these fees.
E-LOAN will not process person-to-person loans that have salvaged titles. The
same purchase and refinance vehicle restrictions apply, i.e., no recreational
vehicles, car kits, ATV's, commercial vehicles or trailers.
2. PROCESSING
A Person-to-Person processing team will handle the processing of the approved
person-to-person loan. This team will be able to answer any questions from
either the approved applicant or seller. They will also be responsible for
ensuring the borrower and seller provide necessary documentation both prior to
approving the Person-to-Person loan funding.
The buyer and seller will be required to meet to exchange the E-LOAN Auto Check
and the Title information.
The buyer and the seller must provide the following documentation to E-LOAN by
means of fax to us prior to E-LOAN approving the loan for funding. Both parties
(buyer(s) and seller(s)) will have to provide copies of the following
information:
Drivers Licence(s) - both parties will need to provide copies
Xxxx of Sale completed - signed and completed by all parties
Completed Title - signed and completed by all parties
Insurance Information - Existing insurance for buyer(s)
Completed Auto Check - Made payable to appropriate parties and completed/
signed by buyer(s)
The purpose of providing the necessary documentation is to ensure that all
necessary documentation is completed correctly and that E-LOAN is placed as
existing lienholder.
2.1 APPROVAL PROCESS
The E-Loan representative will review the documentation and once
all information is completed, then the representative will
instruct the buyer and seller to either revise a document, if
incorrect, or instruct them that everything is completed and to
exchange keys, title and Auto Check.
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3. FUNDING
Funding will occur when the Auto Check is processed through the US banking
system and presented to E-LOAN for payment.
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EXHIBIT 1
MONTH OF CUMULATIVE NET MONTH OF CUMULATIVE NET
SEASONING LOSS RATIO* SEASONING LOSS RATIO*
COLUMN A COLUMN B COLUMN A COLUMN B
--------- -------------- --------- --------------
1 0.014% 30 0.621%
2 0.029% 31 0.632%
3 0.043% 32 0.644%
4 0.057% 33 0.655%
5 0.072% 34 0.667%
6 0.086% 35 0.678%
7 0.112% 36 0.690%
8 0.138% 37 0.695%
9 0.164% 38 0.701%
10 0.190% 39 0.707%
11 0.216% 40 0.713%
12 0.241% 41 0.718%
13 0.269% 42 0.724%
14 0.296% 43 0.726%
15 0.323% 44 0.728%
16 0.351% 45 0.729%
17 0.378% 46 0.731%
18 0.405% 47 0.733%
19 0.427% 48 0.734%
20 0.448% 49 0.736%
21 0.470% 50 0.738%
22 0.491% 51 0.740%
23 0.513% 52 0.741%
24 0.534% 53 0.743%
25 0.549% 54 0.745%
26 0.563% 55 0.747%
27 0.578% 56 0.748%
28 0.592% 57 0.750%
29 0.606%
* For each month from and after month
57, the related amount shall be 0.750%.
