April 26, 2000
NC Capital Corporation
00000 Xxx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx, President
NC Residual II Corporation
00000 Xxx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx, President _______________
Xxxxxxx Xxxxx Xxxxxx, Inc.
as Agent for Salomon Brothers International, Ltd.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Vice President
Re: Global Master Repurchase Agreements dated as of (a) December 11,
1998 between Xxxxxxx Xxxxx Barney, Inc., as Agent for Salomon
Brothers International, Inc. ("Salomon") and NC Capital Corporation
("NCCC"), and (b) December 11, 1998 between Salomon and NC Residual
II Corporation ("NCRC")
Ladies and Gentlemen:
We refer to the above-referenced Global Master Repurchase Agreements (the
"Repurchase Agreements"), pursuant to which Salomon has purchased and may from
time to time hereafter purchase from NCCC and NCRC certain residual
mortgage-backed securities (the "Securities"), subject to the obligations of
NCCC and NCRC, respectively, to repurchase the Securities. Terms capitalized and
used herein without being defined will have the meanings given to them in the
Repurchase Agreements. NCCC and NCRC have each granted to U.S. Bank National
Association, as collateral agent for itself and certain other lenders (in such
capacity, the "Collateral Agent"), a security interest in the rights of NCCC and
NCRC under the Repurchase Agreements. Salomon has previously consented to such
security interest.
The Collateral Agent hereby requests that Salomon agree to the following
with respect to the Repurchase Agreements and the Securities:
1. Salomon will notify the Collateral Agent (at the address provided
below) of any default by NCCC or NCRC under the Repurchase Agreements in
the same manner and at the same time Salomon notifies NCCC or NCRC
thereunder.
2. The Collateral Agent will have the same rights as NCCC and NCRC
to
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Page 2
cure any defaults under the Repurchase Agreements, and the right to
purchase the Securities from Salomon at the Repurchase Price, at any time
before Salomon exercises its remedies with respect to the Securities under
the Repurchase Agreements; provided, that the Collateral Agent shall have
no obligation to cure any default or purchase any Securities. In addition,
the Collateral Agent will have the right to purchase the Securities from
Salomon after Salomon exercises remedies with respect to the Securities,
for a period of 14 calendar days after Salomon notifies the Collateral
Agent of its exercise of remedies, for the Repurchase Price (including
interest to the date of purchase by the Collateral Agent). Once Salomon
has obtained an offer for the Securities (including, without limitation,
for any securities backed by the Securities), for a period of 3 business
days after Salomon notifies the Collateral Agent of such offer, the
Collateral Agent will have a "right-of-first refusal" with respect to such
Securities at a price equal to the greater of (A) the Repurchase Price
(plus interest to the date of such purchase), or (B) the amount of the
offer received for the Securities (including the fair market value, as
reasonably determined by Salomon, of any interest in the Securities to be
retained in connection with a sale of securities backed by the
Securities). Upon any purchase of the Securities by the Collateral Agent
pursuant to this agreement, as between NCCC or NCRC, on the one hand, and
the Collateral Agent, on the other hand, such Securities shall be owned by
NCCC or NCRC, as applicable, subject to the Collateral Agent"s security
interest therein as set forth in the applicable security agreement between
NCCC and NCRC, as debtors, and the Collateral Agent, as secured party.
3. If at any time following the exercise by Salomon of its remedies
with respect to the Securities there is any amount payable to NCCC or NCRC
under the Repurchase Agreements, such amounts shall be paid to the
Collateral Agent by wire transfer of immediately available funds to:
U.S. Bank National Association
U.S. Bank Place
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
ABA Routing Number 000000000
Account Number: 1731-0097-1378
4. If at any time Salomon receives the Repurchase Price with respect
to any of the Securities, unless Salomon purchases such Securities again
on the same day in a new Transaction, Salomon will deliver to the
Collateral Agent at the address set forth below, such Securities, together
with any assignment documentation required to transfer record ownership of
such Securities, duly executed in blank.
5. Salomon is under no obligation to violate any applicable law
(including, without limitation, 11 U.S.C. ss. 362) or order of any court
of competent jurisdiction with
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Page 3
respect to the Securities or the proceeds thereof. In the event NCCC, NCRC
or any other person or entity seeks to recover from Salomon any Securities
or proceeds delivered to the Collateral Agent pursuant to paragraphs 3 or
4 hereof, Salomon shall notify the Collateral Agent thereof and permit the
Collateral Agent to assume the defense thereof. Provided that Salomon has
complied with the foregoing sentence, the Collateral Agent will reimburse
Salomon for any amount recovered from Salomon with respect to the
Securities or the proceeds thereof.
6. Salomon confirms to the Collateral Agent that it has not received
notice of any other security interests in or encumbrances on the
Repurchase Agreements or the Collateral, and agrees to notify the
Collateral Agent within two (2) Business Days after it receives notice of
any such security interest or encumbrance.
Except as set forth above, Salomon will have no other obligation to the
Collateral Agent with respect to the Repurchase Agreements or the Securities.
NCCC and NCRC agree that this letter in no way limits Salomon's rights under the
Repurchase Agreements. NCCC and NCRC, by their acknowledgment hereof, hereby
consent to Salomon's compliance with the provisions set forth above.
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Page 4
Please indicate your agreement to the foregoing by acknowledging this
letter in the space provided below.
Very truly yours,
U.S. BANK NATIONAL ASSOCIATION
By /s/ Xxxxx Xxxxxxx
--------------------------------------
Its
-------------------------------------
Address: U.S. Bank National Association
U.S. Bank Place - MPFP0508
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
Acknowledged and Agreed to this _____
day of _______________, 2000
NC CAPITAL CORPORATION
By /s/ Xxxxxxx Xxxxxxxx
---------------------------------
Its President
--------------------------------
NCRC RESIDUAL II CORPORATION
By /s/ Xxxxxxx Xxxxxxxx
---------------------------------
Its President
--------------------------------
XXXXXXX XXXXX XXXXXX, INC.,
as Agent for Salomon Brothers International, Ltd.
By /s/ [ILLEGIBLE]
---------------------------------
Its
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