REORGANIZATION AND EXCHANGE AGREEMENT
BY AND BETWEEN
DELTA FUNDING RESIDUAL EXCHANGE COMPANY, LLC
AND
DELTA FINANCIAL CORPORATION,
AS OF AUGUST __, 2001
REORGANIZATION AND EXCHANGE AGREEMENT
This REORGANIZATION AND EXCHANGE AGREEMENT (this "Agreement") is made
as of August __, 2001 by and between Delta Funding Residual Exchange Company,
LLC, a Delaware limited liability company (the "Company"), and Delta Financial
Corporation, a Delaware corporation ("DFC"). Except as otherwise indicated
herein, capitalized terms used herein are defined in Article VIII hereof.
RECITALS
WHEREAS, subject to the satisfaction of the Minimum Tender Condition
and the other terms and conditions set forth herein, the Company desires to
deliver to DFC, and DFC desires to accept the delivery of, Senior Notes in the
aggregate principal amount of up to $150,000,000 (but not less than
$135,000,000) in exchange for DFC's delivery to the Company of (i) the
Securitization Residuals, (ii) the Non-Performing Loan Trust Residual, (iii) the
Other Consideration, and (iv) up to 150,000 shares of Preferred Stock, all as
more particularly described in Section 1.1 below (the "Exchange"); and
[WHEREAS, the Exchange as described herein is a transaction intended to
satisfy the requirements of Section 368(a)(1)(E) of the Internal Revenue Code of
1986, as amended (the "IRC").]
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement, the parties hereto agree as follows:
ARTICLE I
EXCHANGE OF THE SECURITIES
1.1 Exchange. On the terms and subject to the conditions set forth in
this Agreement, including, without limitation, the satisfaction of the Minimum
Tender Condition, on or before the Closing:
(a) DFC shall cause each Holding Trust to transfer to the Company
the Residual Certificates listed in column (b) of Schedule 1.1 opposite the
names of the respective Holding Trusts in column (d) of Schedule 1.1(a) attached
hereto.
(b) DFC shall cause DF Special Holdings to transfer to the Company
the Non-Performing Loan Trust Residual.
(c) DFC shall cause the Holding Trusts to deliver to the Company
the Other Consideration.
(d) DFC shall issue and deliver to the Company one share of
Preferred Stock for each $1,000 principal amount of Senior Notes delivered to
DFC by the Company.
(e) The Company shall deliver to DFC all of the Senior Notes
acquired by the Company in the Exchange Offer.
1.2 Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") will take place at the offices of Stroock & Stroock &
Xxxxx LLP, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000-0000 on August __, 2001
(the "Closing Date") (so long as all conditions to the obligations of the
parties to consummate the transactions contemplated hereby have been satisfied
or waived), or at such other time and location as is mutually agreed upon by the
Company and DFC, but in no event later than August 31, 2001.
ARTICLE II
CONDITIONS TO CLOSING
---------------------
2.1 Conditions to Obligations of DFC. The obligation of DFC to
consummate the transactions contemplated by this Agreement are subject to the
satisfaction of the following conditions precedent on or before the Closing
Date:
(a) the representations and warranties of the Company set forth in
Article III will be true and correct in all material respects at and as of the
Closing Date as though then made and as though references to the Closing Date
were substituted for references to the date of this Agreement throughout such
representations and warranties;
(b) the Company shall have delivered to the Exchange Agent, for
the benefit of the holders of the Senior Notes, certificates representing (i)
one Class A Voting Membership Interest and (ii) one share of DFRM Common Stock,
for each $1,000 principal amount of Senior Notes duly and validly tendered in
the Exchange Offer and not properly withdrawn in accordance with the terms of
the Exchange Offer;
(c) the Company shall have delivered to DFC irrevocable
instructions to deliver the shares of Preferred Stock issuable by DFC in
accordance herewith to the Exchange Agent, for the benefit of the holders of the
Senior Notes;
(d) the Company will have performed and complied in all material
respects with each of the covenants and agreements required to be performed by
it under this Agreement and the agreements and documents attached hereto as
Exhibits;
(e) DFC, DFRM and the Exchange Agent, acting in its capacity as
attorney-in-fact for the Tendering Holders and not individually on its own
behalf, shall have executed and delivered an Amended and Restated Limited
Liability Company Agreement, in substantially the
form of Exhibit C attached hereto, with changes or modifications thereto as all
such parties shall agree upon (the "Amended LLC Agreement");
(f) all proceedings to be taken by the Company in connection with
the consummation of the transactions contemplated hereby and by the Exhibits
hereto have been taken, and all certificates, opinions, instruments and other
documents required to be delivered by the Company to effect the transactions
contemplated hereby and thereby will be reasonably satisfactory in form and
substance to DFC;
(g) all consents and waivers by third parties that are required
for the consummation of the transactions contemplated hereby and by the Exhibits
hereto, including, without limitation, any consents that are required in order
that the transactions contemplated hereby and thereby do not constitute a breach
of or a default under or a termination or modification of any agreement to which
any party hereto is a party or to which any property of any party hereto or any
subsidiary of any party hereto is subject, will have been obtained on terms
reasonably satisfactory to DFC;
(h) all governmental filings, authorizations and approvals that
are required for the consummation of the transactions contemplated hereby and by
the Exhibits hereto, if any, will have been duly made and obtained; and
(i) the Company shall have executed and/or delivered to DFC the
documents and instruments required to be executed and/or delivered by the
Company pursuant to Article I.
Any condition to the obligations of DFC specified in this Section
2.1 may be waived by DFC in its sole discretion.
2.2 Conditions to the Obligations of the Company. The obligation of the
Company to consummate the transactions contemplated by this Agreement is subject
to the satisfaction of the following conditions precedent on or before the
Closing Date:
(a) the representations and warranties of DFC set forth in Article
IV, will be true and correct in all material respects at and as of the Closing
Date as though then made and as though references to the Closing Date were
substituted for the date of this Agreement throughout such representations and
warranties;
(b) DFC will have performed and complied in all material respects
with each of their respective covenants and agreements required to be performed
by them under this Agreement and the agreements and documents attached hereto as
Exhibits;
(c) DFC, DFRM and the Exchange Agent, acting in its capacity as
attorney-in-fact for the Tendering Holders and not individually on its own
behalf, shall have executed and delivered the Amended LLC Agreement;
(d) all proceedings to be taken by DFC in connection with the
consummation of the transactions contemplated hereby and by the Exhibits hereto
have been taken, and all certificates, opinions, instruments and other documents
required to be delivered by the Company to effect the transactions contemplated
hereby and thereby will be reasonably satisfactory in form and substance to the
Company;
(e) all consents and waivers by third parties that are required
for the consummation of the transactions contemplated hereby and by the Exhibits
hereto, including, without limitation, any consents that are required in order
that the transactions contemplated hereby and thereby do not constitute a breach
of or a default under or a termination or modification of any agreement to which
any party hereto is a party or to which any property of any party hereto and any
subsidiary of any party hereto is subject, will have been obtained on terms
reasonably satisfactory to the Company;
(f) all governmental filings, authorizations and approvals that
are required for the consummation of the transaction contemplated hereby, and by
the Exhibits hereto, if any, will have been duly made and obtained; and
(g) DFC shall have executed and/or delivered to the Company the
documents and instruments required to be executed and/or delivered by DFC
pursuant to Article I.
Any condition to the obligations of the Company specified in this
Section 2.2 may be waived by the Company in its sole discretion.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
---------------------------------------------
As a material inducement to DFC to enter into this Agreement, the
Company hereby represents and warrants to DFC that:
3.1 Corporate Existence; Good Standing; Compliance with Law. The
Company: (a) is a limited liability company duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization; (b) is duly
qualified to conduct business and is in good standing in each other jurisdiction
where its ownership of property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not have a
Material Adverse Effect on the Company; (c) has the requisite power and
authority and the legal right to own, pledge, mortgage or otherwise encumber its
properties, to conduct its business as now, heretofore and proposed to be
conducted; (d) has all licenses, permits, consents or approvals from or by, and
has made all filings with, and has given all notices to, all governmental
authorities having jurisdiction, to the extent required for such ownership and
conduct, except where the failure to obtain any such license, permit, consent or
approval, or make any such filing or give any such notice, would not have a
Material Adverse Effect on the Company; (e) is in
compliance with the Certificate of Formation and the LLC Agreement; and (f) is
in compliance with all applicable provisions of law, except where the failure to
comply, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect on the Company. The Company has furnished to
counsel for DFC true and correct copies of the Certificate of Formation and the
LLC Agreement.
3.2 Power, Authorization, Enforceable Obligations. The execution,
delivery and performance by the Company of this Agreement, the other agreements
and documents required to be executed hereby and the transactions contemplated
hereby and thereby: (a) are within the Company's power; (b) have been duly
authorized by all necessary or proper action; (c) do not contravene any
provision of the Certificate of Formation or the LLC Agreement; (d) do not
violate any law, statute, rule or regulation, or any judgment, order or decree
of any court or governmental authority or agency applicable to the Company or by
which the Company or its properties may be bound; (e) do not conflict with or
result in the breach or termination of, with or without notice or the lapse of
time constitute a default under or accelerate or permit the acceleration of any
performance required by, or result in any material modification of the terms of,
any material indenture, mortgage, deed of trust, lease, agreement, contract,
obligation, commitment or other material instrument to which the Company is a
party or by which the Company or any of its property is bound; (f) do not result
in the creation or imposition of any lien, charge or encumbrance of any nature
upon any of the property or assets of the Company; and (g) do not require the
consent or approval of any governmental authority or any other person, except
those disclosed on Schedule 3.2 hereto, all of which will have been duly
obtained, made or complied with as of the Closing. This Agreement and the
agreements and documents attached hereto as Exhibits to which the Company is a
party have been, or, on the Closing Date, will have been, duly executed and
delivered by the Company and each such document constitutes, or shall then
constitute, a legal, valid and binding obligation of the Company enforceable
against it in accordance with its terms, except as enforceability thereof may be
limited by bankruptcy, insolvency, reorganization or other similar laws relating
to the enforcement of creditor's rights generally and by general principles of
equity.
3.3 Accredited Investor. The Company is an "accredited investor" within
the meaning of Regulation D under the Securities Act. The Company understands
that the Securities constitute "restricted securities" within the meaning of
Rule 144 under the Securities Act. The Company is acquiring the Securities
pursuant to the Exchange for its own account with the present intention of
holding the Securities for purposes of investment and has no intention of
selling the Securities in a public distribution in violation of the federal
securities laws or any applicable state securities laws.
3.4 Title and Transfer. The Company is the legal owner of the Senior
Notes and has valid and marketable title to the Senior Notes, free and clear of
any lien, pledge and encumbrance or any claim of any third party. As of the
Closing Date, valid and marketable title
to the Senior Notes will pass to DFC free and clear of any lien, pledge and
encumbrance or any claim of any third party.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF DFC
-------------------------------------
As a material inducement to the Company to enter into this Agreement,
DFC hereby represents and warrants to the Company that:
4.1 Corporate Existence; Good Standing; Compliance with Law. DFC: (a)
is a corporation duly incorporated, validly existing and in good standing under
the laws of its jurisdiction of incorporation; (b) is duly qualified to conduct
business and is in good standing in each other jurisdiction where its ownership
of property or the conduct of its business requires such qualification, except
where the failure to be so qualified would not have a Material Adverse Effect on
DFC; (c) has the requisite corporate power and authority and the legal right to
own, pledge, mortgage or otherwise encumber its properties, to conduct its
business as now, heretofore and proposed to be conducted; (d) has all licenses,
permits, consents or approvals from or by, and has made all filings with, and
has given all notices to, all governmental authorities having jurisdiction, to
the extent required for such ownership and conduct, except where the failure to
obtain any such license, permit, consent or approval, or make any such filing or
give any such notice, would not have a Material Adverse Effect on DFC; (e) is in
compliance with its certificate of incorporation and the bylaws; and (f) is in
compliance with all applicable provisions of law, except where the failure to
comply, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect on DFC. DFC has furnished to counsel for the
Company true and correct copies of its certificate of incorporation and bylaws.
4.2 Corporate Power; Authorization; Enforceable Obligations. The
execution, delivery and performance by DFC of this Agreement, the other
agreements and documents required to be executed hereby and the transactions
contemplated hereby and thereby: (a) are within DFC's corporate power; (b) have
been duly authorized by all necessary or proper corporate action; (c) do not
contravene any provision of its certificate of incorporation or bylaws; (d) do
not violate any law, statute, rule or regulation, or any judgment, order or
decree of any court or governmental authority or agency applicable to DFC or by
which DFC or its properties may be bound; (e) do not conflict with or result in
the breach or termination of, with or without notice or the lapse of time,
constitute a default under or accelerate or permit the acceleration of any
performance required by, or result in any material modification of the terms of,
any material indenture, mortgage, deed of trust, lease, agreement, contract,
obligation, commitment or other material instrument to which DFC is a party or
by which DFC or any of its property is bound; (f) do not result in the creation
or imposition of any lien, charge or encumbrance of any nature upon any of the
property or assets of DFC; and (g) do not require the consent or approval of any
governmental authority or any other person, except those disclosed on Schedule
5.2 hereto, all of
which will have been duly obtained, made or complied with as of the Closing.
This Agreement and the agreements and documents attached hereto as Exhibits to
which DFC is a party have been, or, on the Closing Date, will have been, duly
executed and delivered by DFC and each such document constitutes, or shall then
constitute, a legal, valid and binding obligation of DFC enforceable against it
in accordance with its terms, except as enforceability thereof may be limited by
bankruptcy, insolvency, reorganization or other similar laws relating to the
enforcement of creditor's rights generally and by general principles of equity.
4.3 Title and Transfer. DFC, or its affiliates, are the legal owners of
and have valid and marketable title to the Residual Certificates, the
Non-Performing Loan Trust Residual and the Other Consideration, free and clear
of any lien, pledge or encumbrance or any claim of any third party. As of the
Closing Date, valid and marketable title to the Residual Certificates, the
Non-Performing Loan Trust Residual and the Other Consideration will pass to the
Company free and clear of any lien, pledge, encumbrance or any claim of any
third party.
4.4 Issuance of Preferred Shares. The issuance, sale and delivery of
the shares Preferred Stock in accordance with this Agreement have been, or will
be prior to the Closing, duly and validly authorized by all necessary corporate
action on the part of DFC. The shares of Preferred Stock when so issued, sold
and delivered against payment therefor in accordance with the provisions of this
Agreement will be duly and validly issued, fully paid and non-assessable, free
and clear of preemptive or other such rights and not subject to any lien, claim
or encumbrance and such shares will have the designations, preferences and
relative, participating, optional and other special rights as set forth in the
Certificate of Designations set forth as Exhibit B hereto. No further consent,
approval or authorization of the stockholders or directors of DFC will be
required for the issuance, sale or delivery of the shares of Preferred Stock as
contemplated by this Agreement, and no stockholder of DFC is entitled to any
preemptive or other such rights with respect to the purchase or sale of such
shares.
ARTICLE V
COVENANTS OF THE PARTIES
------------------------
The parties further covenant and agree that each party will observe and
comply fully with all of the terms, conditions and covenants of this Agreement
and any other agreements and instruments to be entered into by such party
pursuant to this Agreement.
ARTICLE VI
TERMINATION
-----------
6.1 Termination. This Agreement may be terminated at any time prior to
the Closing:
(a) by mutual written consent of DFC and the Company;
(b) by DFC or the Company if any condition to the Exchange Offer
shall not have been consummated, or if the Closing has not occurred, on or prior
to August 31, 2001; provided, however, that neither DFC nor the Company may
terminate this Agreement pursuant to this Section 6.1(b) if such person's
willful breach of this Agreement has prevented the consummation of the
transaction contemplated hereby at or prior to such time; or
(c) by any party, if a court of competent jurisdiction or other
governmental authority having jurisdiction over the parties hereto shall have
issued an order, decree, ruling or taken any other action permanently
restraining, enjoining or otherwise prohibiting the Closing of the transactions
contemplated by this Agreement and such order, decree, ruling or other action
shall have become final and nonappealable.
6.2 Effect of Termination. In the event of termination of this
Agreement as provided in Section 6.1, this Agreement will forthwith become void
and there will be no liability on the part of any party hereto to any other
party hereto or its shareholders, managers, directors, officers or members in
respect hereof, except that nothing herein will relieve any party from liability
resulting from any breach of this Agreement prior to such termination.
ARTICLE VII
ADDITIONAL AGREEMENTS
---------------------
7.1 Survival. Notwithstanding any examination made for or on behalf of
either party, the knowledge of any of either party's officers, directors,
managers, stockholders, members, employees or agents, or the acceptance of any
certificate or opinion, all representations, warranties, covenants and
agreements set forth in this Agreement or in any writing delivered in connection
with this Agreement shall survive the Closing and shall be fully effective and
enforceable until the termination of any statute of limitation applicable to the
rights of the parties hereunder.
7.2 Further Assurances. Each party (at its own expense) will execute
and deliver such further instruments of conveyance and transfer and take such
additional action as any other party may reasonably deem necessary to effect,
consummate, confirm or evidence the transactions that are the subject of this
Agreement. Each party will execute such documents as may be reasonably necessary
in preserving or perfecting any other party's rights pursuant to this Agreement
and will also complete such actions as are necessary to perform its
representations, warranties and agreements herein, including, without
limitation, after the Closing, making all registrations, filings and
applications, giving all notices and obtaining all governmental, third party or
other consents, transfers, approvals, orders, qualifications and waivers
desirable for the consummation of the transactions contemplated hereby which,
for any reason, have not been made, given or obtained prior to the Closing.
7.3 Specific Performance. Each party acknowledges that the transactions
contemplated hereby are unique and recognize and affirm that in the event of a
breach of this Agreement by either party, money damages may be inadequate and
the other party may have no adequate remedy at law. Accordingly, each party
shall have the right, in addition to any other rights and remedies existing in
its favor at law or in equity, to enforce its rights and the other party's
obligations hereunder not only by an action or actions for damages, but also by
an action or actions for specific performance, injunctive and/or other equitable
relief (without posting of bond or other security).
7.4 Investigation. Prior to the Closing Date, each party and its
representatives may make or cause to be made such investigation of the matters
pertinent to the transactions contemplated hereby as each party deems reasonably
necessary or advisable and each party shall furnish and disclose promptly to the
investigating party all information concerning said matters as the investigating
party or its representatives reasonably request.
ARTICLE VIII
DEFINITIONS
-----------
"Agreement" shall have the meaning set forth in the preamble
of this Agreement.
"Amended LLC Agreement" shall have the meaning set forth in
Section 2.1(e).
"Business Day" shall mean any day other than a Saturday,
Sunday or a day upon which commercial banks in the State of New York are
required or permitted by law or state regulations to be closed.
"Certificate of Formation" means that certain instrument filed
on June 25, 2001, with the Secretary of State of the State of Delaware whereby
the Company was formed.
"Class A Voting Member" has the meaning given thereto in the
Amended LLC Agreement.
"Class A Voting Membership Interest" means a Membership
Interest entitled to the right to receive distributions, liquidation payments,
and voting rights as specified in the Amended LLC Agreement.
"Closing" shall have the meaning set forth in Section 1.2.
"Closing Date" shall have the meaning set forth in
Section 1.2.
"Company" shall have the meaning set forth in the preamble to
this Agreement.
"DFC" shall have the meaning set forth in the preamble to this
Agreement.
"DFRM" means Delta Funding Residual Management, Inc.,
a Delaware corporation.
"DFRM Common Stock" means the shares of common stock, par
value $0.01 per share, of DFRM.
"DF Special Holdings" means DF Special Holdings Corporation, a
Delaware corporation and an affiliate of DFC.
"Exchange" shall have the meaning set forth in the first
recital of this Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Agent" means the U.S. Bank Trust National
Association.
"Exchange Offer" means the exchange offer made by the Company
to the holders of the Senior Notes pursuant to the Registration Statement.
"Expiration Date" means the date of the expiration of the
Exchange Offer as set forth in the Registration Statement.
"Holding Trust 2000-1" means Delta Funding Residual Holding
Trust 2000-1, an affiliate of DFC.
"Holding Trust 2000-2" means Delta Funding Residual Holding
Trust 2000-1, an affiliate of DFC.
"Holding Trusts" means Holding Trust 2000-1 and Holding
Trust 0000-0.
"XXX" shall mean the Internal Revenue Code of 1986, as
amended.
"LLC Agreement" means that certain Limited Liability Company
Agreement dated as of June 25, 2001 executed by DFC, as the sole member of the
Company.
"Material Adverse Effect" shall mean, with respect to any
Person, a material adverse change in the business, assets, earnings, operations,
or financial condition of such Person.
"Membership Interest" means the membership interest in the
Company.
"Minimum Tender Condition" shall mean the condition to the
Exchange Offer that the holders of Senior Notes representing at least 95% of the
principal amount thereof outstanding on the date hereof shall have validly
tendered such Senior Notes in the Exchange Offer, and the Exchange Offer shall
have expired and such holders shall not have validly withdrawn the tendered
Senior Notes; provided, however, that that the Company may waive the Minimum
Tender Condition if not less than $135,000,000 principal amount of Senior Notes
are validly tendered.
"Non-Performing Loan Trust Residual" means the residual
interest in the Delta Financial Non-Performing Loan Trust 2000-1 more fully
described on Exhibit A hereto.
"Other Consideration" means all cash and other property held
by the respective Holding Trusts as of the Closing Date, as more fully described
on Exhibit B hereto.
"Person" means any individual, sole proprietorship,
partnership (including a limited partnership), joint venture, trust,
unincorporated organization, association, corporation, institution, public
benefit corporation, limited liability company, joint stock company, entity or
government (whether federal, state, county, city, municipal or otherwise,
including, without limitation, any instrumentality, division, agency, body or
department thereof) or other business entity.
"Preferred Stock" means the shares of Series A Preferred
Stock, par value $0.01 per share, of DFC.
"Residual Certificates" means the certificates listed in
column (b) on Schedule 1.1 attached hereto representing the percentage interests
set forth in column (c) on Schedule 1.1 in the respective securitization trusts
listed in column (a) on Schedule 1.1.
"Registration Statement" means Form S-4 Registration Statement
filed on behalf of DFC, the Company and DFRM with the Securities Exchange
Commission on May 4, 2001, as amended
"Securities" means the Residual Certificates and the
Non-Performing Loan Trust Residual.
"Securities Act" means the Securities Exchange Act of 1933, as
amended.
"Senior Notes" means DFC's 91/2% Senior Secured Notes due 2004
and DFC's 91/2% Senior Notes due 2004.
"Tendering Holder" means each holder of Senior Notes which,
prior to the Expiration Date, shall have duly and validly tendered Senior Notes
to the Company pursuant to the Exchange Offer, which tender shall not have been
withdrawn by such holder and which Senior Notes shall have been accepted for
exchange by the Company.
ARTICLE IX
MISCELLANEOUS
9.1 Amendment and Waiver. This Agreement may be amended and any
provision of this Agreement may be waived; provided, however, that, subject to
the last sentence of Section 2.1 and the last sentence of Section 2.2, any such
amendment or waiver will be binding upon a party only if such amendment or
waiver is set forth in a writing executed by all of the parties hereto. No
course of dealing between or among any persons having any interest in this
Agreement will be deemed effective to modify, amend or discharge any part of
this Agreement or any rights or obligations of any party under or by reason of
this Agreement.
9.2 Payment of Fees and Expenses. Each party shall be responsible for
their own costs and expenses incurred by it in connection with this Agreement
and the transactions contemplated hereby, including, without limitation, fees
and disbursements of counsel, financial advisors and accountants.
9.3 Notices. All notices, demands and other communications given or
delivered under this Agreement will be in writing and shall be made by hand
delivery, overnight courier, first-class mail, or telecopier and will be deemed
to have been given when personally delivered, four business days after being
mailed by first class mail, return receipt requested, or delivered by express
courier service or telecopied (subject to receipt of written confirmation).
Notices, demands and communications to the parties will, unless another address
is specified in writing, be sent to the addresses indicated below:
Notices to the Company:
Delta Funding Residual Exchange Company, LLC
0000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention:
Telephone number:
Fax number:
With copies to:
Stroock & Stroock & Xxxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Telephone number: (000) 000-0000
Fax number: (000) 000-0000
Notices to DFC:
Delta Financial Corporation
0000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxx, President
Telephone number: (000) 000-0000
Fax number: (000) 000-0000
With copies to:
Stroock & Stroock & Xxxxx LLP
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxx X. Xxxxxxxxx, Esq.
Telephone number: (000) 000-0000
Fax number: (000) 000-0000
9.4 Binding Agreement; Assignment. This Agreement and all of the
provisions hereof will be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, but neither this
Agreement nor any of the rights, interests or obligations hereunder may be
assigned by any party without the prior written consent of the other parties.
9.5 Severability. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision will be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provisions or the remaining provisions of this Agreement.
9.6 No Strict Construction. The language used in this Agreement will be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction will be applied against any person.
9.7 Headings; Interpretation. The headings used in this Agreement are
for convenience of reference only and do not constitute a part of this Agreement
and will not be deemed to limit, characterize or in any way affect any provision
of this Agreement, and all provisions of this Agreement will be enforced and
construed as if no caption had been used in this Agreement. Whenever the term
"including" is used in this Agreement (whether or not that term is followed by
the phrase "but not limited to" or "without limitation" or words of similar
effect) in connection with a listing of one or more items or matters, that
listing will be interpreted to be illustrative only and will not be interpreted
as a limitation on, or an exclusive listing of, such items or matters.
9.8 Entire Agreement. This Agreement and the documents referred to
herein contain the entire agreement between the parties and supersede any prior
understandings, agreements or representations by or between the parties, written
or oral, which may have related to the subject matter hereof in any way.
9.9 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which taken
together will constitute one and the same instrument.
9.10 Governing Law. THIS AGREEMENT AND THE EXHIBITS AND SCHEDULES
HERETO SHALL BE GOVERNED BY THE INTERNAL LAW OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER
OF THE STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
9.11 Parties in Interest. Nothing in this Agreement, express or
implied, is intended to confer on any person other than the parties and their
respective successors and assigns any rights or remedies under or by virtue of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
DELTA FUNDING RESIDUAL EXCHANGE COMPANY, LLC
By: Delta Financial Corporation, its sole member
By:
----------------------------------------
Name:
Title:
DELTA FINANCIAL CORPORATION
By:
------------------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President and Secretary
SCHEDULE 1.1
SECURITIZATION RESIDUALS
(a) (b) (c) (d)
----------------------------------------- ------------------------ ----------------------------- ---------------------
Name and Series of the Securitization Residual Certificates Percentage Interest Owner
Trust (class)
CTS Home Equity Loan Trust 1994-2 R 75% Delta Funding
Residual Holding
Trust 2000-2
Delta Residual Interest Trust 1995-1 B 100% (represents 62.5% of Delta Funding
Delta Funding Home Equity Residual Holding
Loan Trust 1995-1, Class Trust 2000-2
R-1 and R-2)
Delta Funding Home Equity Loan Trust R 99.999999% Delta Funding
1995-2 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust R-1 0.000001% Delta Funding
1995-2 Corporation
Delta Funding Home Equity Loan Trust R-1; R-2 0.000001% Delta Funding
1997-3 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2 0.000001% Delta Funding
1997-4 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust R-1; R-2 0.000001% Delta Funding
1998-1 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust R-1; R-2 99.999999% Delta Funding
1998-2 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2 0.000001% Delta Funding
1998-2 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.99999% Delta Funding
1998-3 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
1998-3 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.99999% Delta Funding
1998-4 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
1998-4 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.99999% Delta Funding
1999-1 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
1999-1 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust BIO 100% Delta Funding
1999-2 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.999999% Delta Funding
1999-2 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
1999-2 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust BIO 100% Delta Funding
2000-1 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.999999% Delta Funding
2000-1 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
2000-1 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust BIO 100% Delta Funding
2000-2 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.999999% Delta Funding
2000-2 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
2000-2 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust BIO 100% Delta Funding
2000-3 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.999999% Delta Funding
2000-3 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
2000-3 Residual Holding
Trust 2000-2
Delta Funding Home Equity Loan Trust BIO 100% Delta Funding
2000-4 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 99.999999% Delta Funding
2000-4 Residual Holding
Trust 2000-1
Delta Funding Home Equity Loan Trust R-1; R-2; R-3 0.000001% Delta Funding
2000-4 Residual Holding
Trust 2000-2
Delta Funding NIM Trust 2000-1 owner trust certificate 100% Delta Funding
Residual Holding
Trust 2000-1
----------------------------------------- ------------------------ ----------------------------- ---------------------
EXHIBIT A
DELTA FUNDING NON-PERFORMING LOAN TRUST 2000-1
In February 2000, Delta Funding Non-Performing Loan Trust
2000-1, as issuer, issued $3 million of 9.50% Delta Funding Non-Performing Loan
Trust Notes, Series 2000-1, or the "non-performing loan trust notes", pursuant
to an indenture, dated as of February 11, 2000, between the issuer and Xxxxx
Fargo Bank Minnesota, National Association, as indenture trustee. The issuer is
a Delaware business trust formed pursuant to an Amended and Restated Trust
Agreement, dated February 11, 2000, between Delta Funding Corporation, as
depositor, and Wilmington Trust Company, as owner trustee. The non-performing
loan trust notes are secured by, and payable from, the cashflow from a pool of
non-performing mortgage loans sold to the issuer by Delta Funding Corporation
pursuant to a Sale Agreement, dated as of February 11, 2000, among Delta Funding
Corporation, the issuer, the Indenture Trustee and Xxxxxxx National, Inc., as
servicer. The servicer is servicing the mortgage loans on behalf of the issuer
and the noteholders. DF Special Holdings Corporation owns 100% of the owner
trust certificates representing the non-performing loan receivables issued by
the issuer and is entitled to any cashflow and other assets remaining after the
non-performing loan trust notes have been paid in full. The notes were not rated
by any rating agency.
EXHIBIT B
[TO BE PROVIDED]
EXHIBIT C
AMENDED LIMITED LIABILITY COMPANY AGREEMENT
EXHIBIT D
CERTIFICATE OF DESIGNATIONS
TABLE OF CONTENTS
ARTICLE I EXCHANGE OF THE SECURITIES.............................................................................1
1.1 Exchange.................................................................................................1
1.2 Closing..................................................................................................2
ARTICLE II CONDITIONS TO CLOSING.................................................................................2
2.1 Conditions to Obligations of DFC.........................................................................2
2.2 Conditions to the Obligations of the Company.............................................................3
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY........................................................4
3.1 Corporate Existence; Good Standing; Compliance with Law..................................................4
3.2 Power, Authorization, Enforceable Obligations............................................................5
3.3 Accredited Investor......................................................................................5
3.4 Title and Transfer............................................................Error! Bookmark not defined.
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF DFC.................................................................6
4.1 Corporate Existence; Good Standing; Compliance with Law..................................................6
4.2 Corporate Power; Authorization; Enforceable Obligations..................................................6
4.3 Title and Transfer.......................................................................................7
4.4 Issuance of Preferred Shares.............................................................................7
ARTICLE V COVENANTS OF THE PARTIES...............................................................................7
ARTICLE VI TERMINATION...........................................................................................7
6.1 Termination..............................................................................................7
6.2 Effect of Termination....................................................................................8
ARTICLE VII ADDITIONAL AGREEMENTS................................................................................8
7.1 Survival.................................................................................................8
7.2 Further Assurances.......................................................................................8
7.3 Specific Performance.....................................................................................9
7.4 Investigation............................................................................................9
ARTICLE VIII DEFINITIONS.........................................................................................9
ARTICLE IX MISCELLANEOUS........................................................................................12
9.1 Amendment and Waiver....................................................................................12
9.2 Payment of Fees and Expenses............................................................................12
9.3 Notices.................................................................................................12
9.4 Binding Agreement; Assignment...........................................................................13
9.5 Severability............................................................................................13
9.6 No Strict Construction..................................................................................13
i
9.7 Headings; Interpretation................................................................................13
9.8 Entire Agreement........................................................................................14
9.9 Counterparts............................................................................................14
9.10 Governing Law...........................................................................................14
9.11 Parties in Interest.....................................................................................14
EXHIBITS
Exhibit A - Delta Funding Non-Performing Residual Loan Trust 2000-1
Exhibit B - Other Consideration
Exhibit C - Amended Limited Liability Company Agreement
Exhibit D - Certificate of Designations
LIST OF SCHEDULES
Schedule 1.1 - Securitization Residuals
Schedule 3.2 - Third Party Consents
ii
