Exhibit 10.96
AMENDMENT NUMBER TWO
to the
Master Loan and Security Agreement
dated as of May 10, 1999,
Between
E-LOAN, INC.
and
GREENWICH CAPITAL FINANCIAL PRODUCTS, INC.
This AMENDMENT NUMBER TWO (this "AMENDMENT") is made this 22nd day
of February, 2001, between E-LOAN, INC. ("BORROWER") and GREENWICH CAPITAL
FINANCIAL PRODUCTS, INC. ("LENDER") to the MASTER LOAN AND SECURITY AGREEMENT,
dated as of May 10, 1999, between Lender and Borrower, as otherwise amended (the
"LOAN AGREEMENT").
RECITALS
WHEREAS, Borrower has requested that Lender agree to amend the
Loan Agreement to extend the Termination Date thereunder and to make such
additional modifications as more expressly set forth below and Lender has agreed
to make such amendments to the Loan Agreement.
WHEREAS, that as of the date of this Amendment, Borrower
represents to the Lender that it is in compliance with all of the
representations and warranties and all of the affirmative and negative covenants
set forth in the Loan Agreement and will not be in default under the Loan
Agreement upon the execution of this Amendment.
WHEREAS, Borrower has agreed to deliver all closing documents
requested by the Lender including, but not limited to, a Uniform Commercial Code
Financing Statement, an officer's certificate in the form attached hereto as
Exhibit A, warrants and all other documents required thereunder, and agrees to
satisfy all conditions precedent to any Advance thereunder.
NOW THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, and of the mutual covenants
herein contained, the parties hereto hereby agree as follows:
SECTION 1. Effective as of February 22, 2001, Section 1 of the
Loan Agreement is hereby amended by adding the following definition:
"ADDITIONAL COLLATERAL" shall mean a cash deposit or deposit of
other collateral acceptable to the Lender in its sole discretion by the Borrower
in a separate account held for the benefit of the Borrower and established by
the Lender with Greenwich Capital Markets, Inc., a broker-dealer and affiliate
of the Lender totaling an amount equal to $4 million plus any additional amounts
deposited by the Lender in such account in accordance with Section 3.06.
SECTION 2. Effective as of February 22, 2001, the definition of
"Applicable Margin" in Section 1 of the Loan Agreement is hereby amended to read
in its entirety as follows:
-2- Exhibit 10.96
"APPLICABLE MARGIN" shall mean with respect to Advances that are
Tranche A Advances and Tranche B Advances respectively, and which
are secured by the Mortgage Loans, the applicable rate per annum
set forth below for each day that such Advances shall be so
secured:
Tranche A Advances .............. prior to April 1, 2001
1.00% and thereafter 0.75%
Tranche B Advances ................ 1.25%
SECTION 3. Effective as of February 22, 2001, clause (10) of
subparagraph (ii) of the definition of Collateral Value in Section 1 of the Loan
Agreement is hereby deleted in its entirety and replaced with the following:
"(10) the aggregate Collateral Value of all Mortgage Loans that
are not covered by a Takeout Commitment may not at any one
time exceed $25,000,000; or"
SECTION 4. Effective as of February 22, 2001, clause (2) of the
definition of Maximum Credit in Section 1 of the Loan Agreement is hereby
deleted in its entirety and replaced with the following:
"(2) the Maximum Credit for Mortgage Loans which are Wet Loans
may not exceed $10 million at any time; provided, however that
during the period commencing on the fourth to the last Business
Day of a given calendar month and ending on the fifth Business Day
of the immediately succeeding calendar month (the "End-of-Month
Period") the limitation in this clause shall be increased to $15
million; provided, further, that from and after April 1, 2001, if
no Default or Event of Default exists and if the aggregate amount
of outstanding Advances is equal to or greater than $75 million,
the limitation in this clause shall be increased to $20 million
during the End-of-Month Period."
SECTION 5. Effective as of February 22, 2001, the defined term
Non-Usage Fee Trigger Percentage in Section 1 of the Loan Agreement is hereby
amended to read in its entirety as follows:
"NON-USAGE FEE TRIGGER PERCENTAGE" shall mean 50%.
SECTION 6. Effective as of February 22, 2001, Section 1 of the
Loan Agreement is hereby amended by adding the following defined term
immediately following the defined term "Revised Effective Date":
"SECOND REVISED EFFECTIVE DATE" shall mean February 22, 2001.
SECTION 7. Effective as of February 22, 2001, the definition of
"Termination Date" in Section 1 of the Loan Agreement is hereby amended to read
in its entirety as follows:
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"TERMINATION DATE" shall mean the date which is 364 days following
the Second Revised Effective Date of this Loan Agreement, or such
earlier date on which this Loan Agreement shall terminate in
accordance with the provisions hereof, including without
limitation pursuant to Section 2.10 hereof, or by operation of
law, as same may be extended pursuant to Section 2.09.
SECTION 8. Effective as of February 22, 2001, Section 2 of the
Loan Agreement is hereby amended by adding a new Section 2.10 thereto to read in
its entirety as follows:
2.10 ACCELERATED TERMINATION EVENTS.
(a) The Borrower and the Lender hereby acknowledge and agree
that, in the event that the Borrower does not satisfy the
liquidity requirements of Section 7.16 on April 1, 2001, but on
such date (i) the Borrower maintains cash and Cash Equivalents in
an amount not less than $20,000,000 taking into account 80% of the
unpaid principal balance of the unencumbered auto loans owned by
the Borrower, and (ii) the Borrower is otherwise in compliance
with all of the terms and conditions of this Loan Agreement, then
the Lender shall not immediately declare an Event of Default
solely based on the failure to satisfy the requirements of Section
7.16 hereof. Instead, the Borrower and the Lender agree that the
Termination Date shall be April 30, 2001 and that prior to such
termination the outstanding principal amount of Advances secured
by Wet Loans may not exceed $10,000,000. Notwithstanding anything
to the contrary contained in this paragraph (a), the amount of
Cash Equivalents attributable to unencumbered auto loans owned by
the Borrower shall not exceed $13 million.
(b) The Borrower and the Lender hereby acknowledge and agree
that, in the event that the Borrower does not satisfy the
liquidity requirements of Section 7.16 on May 1, 2001, but on such
date (i) the Borrower maintains cash and Cash Equivalents in an
amount not less than $20,000,000 taking into account 80% of the
unpaid principal balance of the unencumbered auto loans owned by
the Borrower, and (ii) the Borrower is otherwise in compliance
with all of the terms and conditions of this Loan Agreement, then
the Lender shall not immediately declare an Event of Default
solely based on the failure to satisfy the requirements of Section
7.16 hereof. Instead, the Borrower and the Lender agree that the
Termination Date shall be May 31, 2001 and that prior to such
termination the outstanding principal amount of Advances secured
by Wet Loans may not exceed $5,000,000. Notwithstanding anything
to the contrary contained in this paragraph (b), the amount of
Cash Equivalents attributable to unencumbered auto loans owned by
the Borrower shall not exceed $13 million.
(c) Notwithstanding anything to the contrary contained in
paragraph (a) or (b) above, in the event that during the month of
April 2001 or May 2001, as applicable, the Borrower is otherwise
in default under the Loan Agreement and the Lender has extended
the Termination Date as provided in paragraph (a) or (b)
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above, the Lender shall not be obligated to fund any additional
Advances hereunder during the remainder of the such month.
SECTION 9. Effective as of February 22, 2001, Section 3.05 of the
Loan Agreement is hereby amended to read in its entirety as follows:
3.05 NON-UTILIZATION FEE. On a monthly basis, Lender shall
determine the average daily utilization during such month by
Borrower of the Maximum Committed Amount made available hereunder
by dividing (a) the sum of the Advances outstanding on each day
during such month by (b) the number days in such calendar month.
If such average amount determined for any month as a percentage of
the then applicable Maximum Committed Amount (the "UTILIZATION
PERCENTAGE") is less than the Non-Usage Fee Trigger Percentage,
Borrower shall pay to Lender, on the Payment Date in the next
following calendar month or on the Termination Date if such date
is sooner, a non-utilization fee equal to the product of (i)
.0025, times (ii) the Maximum Committed Amount, times (iii) 1
minus the Utilization Percentage. If the Utilization Percentage in
any month is greater than or equal to the applicable Non-Usage Fee
Trigger Percentage Lender shall not be entitled to a
non-utilization fee for that month. Lender may, in its sole
discretion, net such non-utilization fee from the proceeds of any
Advance made to Borrower hereunder.
SECTION 10. Effective as of February 22, 2001, Section 3 of the
Loan Agreement is hereby amended by adding a new Section 3.06 thereto to read in
its entirety as follows:
3.06 SECOND REVISED EFFECTIVE DATE COMMITMENT FEE. The Borrower
agrees to pay to the Lender, a Second Revised Effective Date
Commitment Fee in an amount equal to $1,250,000, which amount
shall be deemed to have been earned on the Second Revised
Effective Date. Such amount shall be paid as follows: $1,000,000
shall be paid on the Second Revised Effective Date and $250,000
shall be paid on or prior to March 23, 2001. Such payments shall
be made in Dollars, in immediately available funds, without
deduction, set-off or counterclaim. Lender may, in its sole
discretion, net such commitment fee from the proceeds of any
Advance made to Borrower. The Lender hereby agrees to rebate to
the Borrower an amount equal to $500,000 of such Second Revised
Effective Date Commitment Fee on April 1, 2001 if, and only if,
(a) the Borrower shall have paid the full amount of the Second
Revised Effective Date Commitment Fee to the Lender, (b) the
Borrower has transferred $4,000,000 of Additional Collateral to
the Lender pursuant to the terms of this Loan Agreement on or
before April 1, 2001, (c) the Borrower is in compliance with the
liquidity covenant in Section 7.16 of this Loan Agreement (not
taking into account any unencumbered auto loans owned by the
Borrower that could be drawn against under committed warehouse and
repurchase facilities entered into by the Borrower) as of April 1,
2001 and (d) no Default or Event of Default has occurred
hereunder. In the event that such $500,000 rebate is payable to
the Borrower hereunder, the Borrower and the Lender agree that
such amount shall be deposited
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with the Lender and retained as Additional Collateral hereunder.
The Lender hereby further agrees to rebate to the Borrower an
amount equal to $250,000 of such Second Revised Effective Date
Commitment Fee on May 1, 2001 if, and only if, (a) the Borrower
shall have paid the full amount of the Second Revised Effective
Date Commitment Fee to the Lender, (b) the Borrower has
transferred $4,000,000 of Additional Collateral to the Lender
pursuant to the terms of this Loan Agreement on or before May 1,
2001, (c) the Borrower is in compliance with the liquidity
covenant in Section 7.16 of this Loan Agreement (not taking into
account any unencumbered auto loans owned by the Borrower that
could be drawn against under committed warehouse and repurchase
facilities entered into by the Borrower) as of May 1, 2001 and (d)
no Default or Event of Default has occurred hereunder.. In the
event that such $250,000 rebate is payable to the Borrower
hereunder, the Borrower and the Lender agree that such amount
shall be paid to the Borrower and not retained as Additional
Collateral hereunder.
SECTION 11. Effective as of February 22, 2001, subparagraph (b) of
Section 4.01 of the Loan Agreement is hereby amended by deleting the word "and"
in clause (viii), deleting clause (ix) in its entirety and adding the following
to the end thereof:
"(ix) all Additional Collateral; and
(x) any and all replacements, substitutions, distributions on
or proceeds of any or all of the foregoing."
SECTION 12. Effective as of February 22, 2001, Section 4.01 of the
Loan Agreement is hereby amended by adding the following subparagraphs to the
end thereof:
"(d) On or before April 1, 2001, the Borrower shall deposit the
Additional Collateral with the Lender in a separate account (the
"Account") held for the benefit of the Borrower and established by
the Lender with Greenwich Capital Markets, Inc., a broker-dealer
and an affiliate of the Lender. The Lender and the Borrower hereby
agree that, prior to the occurrence of an Event of Default, the
Borrower shall have a 100% ownership interest in the Additional
Collateral subject to the Lender's first priority perfected
security interest therein. The Additional Collateral shall be held
by the Lender for the benefit of the Borrower during the term of
this Loan Agreement to secure repayment of the Secured
Obligations. The Lender agrees that the Account shall evidence the
Borrower's ownership of the Additional Collateral subject to the
security interest granted to the Lender hereunder.
(e) At such time as the Secured Obligations have been paid in
full, the Lender shall return any unused portion of the Additional
Collateral held for the benefit of the Borrower to the Borrower.
With respect to any portion of the Additional Collateral which is
represented by cash, the Lender hereby agrees to pay interest to
the Borrower on the amount on deposit in the Account during the
term of this Loan Agreement (which amount may be reduced by the
Lender after the initial deposit in satisfaction of the Secured
Obligations) calculated on the basis of one-
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month LIBOR from the day the initial deposit was made until such
time as the Secured Obligations have been paid in full. With
respect to any portion of the Additional Collateral which is
represented by another form of collateral acceptable to the Lender
in its sole discretion, the Borrower shall direct the form of
investment subject to the Lender's approval. The Borrower shall be
entitled to all investment earnings attributable to such
collateral from the day such collateral is deposited until such
time as the Secured Obligations have been paid in full. The Lender
shall remit to the Borrower all interest accrued with respect to
the Additional Collateral and any investments earnings thereon at
such time as the Secured Obligations have been paid in full."
SECTION 13. Effective as of February 22, 2001, Section 5.01 of the
Loan Agreement is hereby amended by adding a new subsection (q) to read in its
entirety as follows:
(q) SECOND UPDATED SECURITIZATION LETTER. On or prior to the
Second Revised Effective Date, the Lender shall have
received a new securitization letter, in form and substance
satisfactory to the Lender and executed by a duly
authorized officer of the Borrower.
SECTION 14. Effective as of February 22, 2001, Section 5.01 of the
Loan Agreement is hereby amended by adding a new subsection (r) to read in its
entirety as follows:
(r) WARRANT. On or before the Second Revised Effective
Date, the Lender shall have received an executed Stock Purchase
Warrant, in form and substance satisfactory to the Lender and
executed by a duly authorized officer of the Borrower.
SECTION 15. Effective as of February 22, 2001, Section 5.01 of the
Loan Agreement is hereby amended by adding a new subsection (s) to read in its
entirety as follows:
(s) ADDITIONAL COLLATERAL. On or before April 1, 2001,
the Borrower shall deposit the Additional Collateral with the
Lender pursuant to the Lender's instructions.
SECTION 16. Effective as of February 22, 2001, Section 7.01(c) of
the Loan Agreement is hereby amended to read in its entirety as follows:
"(c) The Borrower shall deliver to the Lender on the first
Business Day of each month a report containing the Borrower's cash
flow projections for the 90 day period commencing on such date and
such report shall include a monthly cash flow projection for such
month and an aggregate cash flow projection for each of the
following two months thereafter. In addition, the Borrower shall
deliver to the Lender from time to time such other information
regarding the financial condition, operations, or business of the
Borrower as the Lender may reasonably request; and"
-7- Exhibit 10.96
SECTION 17. Effective as of February 22, 2001, Section 7.16 of the
Loan Agreement is hereby amended to read in its entirety as follows:
7.16 MAINTENANCE OF LIQUIDITY. The Borrower shall insure that,
as of the end of each calendar month, it has cash and Cash
Equivalents in an amount of not less than the greater of (i)
$20,000,000 and (ii) the highest amount of liquidity required to
be maintained by the Borrower pursuant to any other agreement,
note, indenture or instrument to which the Borrower is a party.
The Borrower and the Lender agree that prior to March 31, 2001 the
term Cash Equivalents as used hereunder shall include 80% of the
unpaid principal balance of the unencumbered auto loans owned by
the Borrower; provided that, the amount of such Cash Equivalents
attributable to such auto loans shall not exceed $13 million.
SECTION 18. Effective as of February 22, 2001, Section 7.17 of the
Loan Agreement is hereby amended to read in its entirety as follows:
7.17 MAINTENANCE OF TANGIBLE NET WORTH. The Borrower shall not
permit Tangible Net Worth at any time to be less than the greater
of (a) $20,000,000 or (b) the highest amount of Tangible Net Worth
required to be maintained by the Borrower pursuant to any other
agreement, note, indenture or instrument to which the Borrower is
a party.
SECTION 19. Effective as of February 22, 2001, Section 7.18 of the
Loan Agreement is hereby amended to read in its entirety as follows:
7.18 MAINTENANCE OF RATIO OF TOTAL INDEBTEDNESS TO TANGIBLE NET
WORTH. The Borrower shall not permit the ratio of Total
Indebtedness to Tangible Net Worth at any time to be greater than
the lesser of (a) 10:1 or (b) the lowest such ratio required to be
maintained by the Borrower pursuant to any other agreement, note,
indenture or instrument to which the Borrower is a party.
SECTION 20. Effective as of February 22, 2001, Section 7.28 of the
Loan Agreement is hereby amended to read in its entirety as follows:
7.28 COMMITTED WAREHOUSE FACILITIES. Borrower shall at all times
have available under committed revolving facilities (other than
with Lender) at least $50,000,000. Such other committed revolving
facilities shall include wet loans in an amount at least equal to
$20,000,000. Borrower shall utilize the wet funding limits of such
other committed revolving facilities at least once each month.
SECTION 21. Effective as of February 22, 2001, Section 11 of the
Loan Agreement is hereby amended by deleting Section 11.19 thereto.
SECTION 22. FEES AND EXPENSES. Borrower agrees to pay to Lender
all fees and out of pocket expenses incurred by Lender in connection with this
Amendment (including all reasonable fees and out of pocket costs and expenses of
the Lender's legal counsel incurred in
-8- Exhibit 10.96
connection with this Amendment Number Two), in accordance with Section 11.03 of
the Loan Agreement
SECTION 23. DEFINED TERMS. Any terms capitalized but not otherwise
defined herein shall have the respective meanings set forth in the Loan
Agreement.
SECTION 24. REPRESENTATIONS. In order to induce the Lender to
execute and deliver this Amendment Number Two, the Borrower hereby represents to
the Lender that as of the date hereof, after giving effect to this Amendment
Number Two, the Borrower is in full compliance with all of the terms and
conditions of the Loan Agreement.
SECTION 25. LIMITED EFFECT. Except as expressly amended and
modified by this Amendment, the Loan Agreement shall continue in full force and
effect in accordance with its terms. Reference to this Amendment Number Two need
not be made in the Loan Agreement or any other instrument or document executed
in connection therewith, or in any certificate, letter or communication issued
or made pursuant to, or with respect to, the Loan Agreement, any reference in
any of such items to the Loan Agreement being sufficient to refer to the Loan
Agreement as amended hereby.
SECTION 26. GOVERNING LAW. THIS AMENDMENT NUMBER TWO SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS DOCTRINE APPLIED
IN SUCH STATE.
SECTION 27. COUNTERPARTS. This Amendment Number Two may be
executed by each of the parties hereto on any number of separate counterparts,
each of which shall be an original and all of which taken together shall
constitute one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
-9- Exhibit 10.96
IN WITNESS WHEREOF, Borrower and Lender have caused this amendment
to be executed and delivered by their duly authorized officers as of the day and
year first above written.
E-LOAN, INC.,
BORROWER
By: /s/ XXXXXX X. XXXXXXX
-------------------------------
Name: XXXXXX X. XXXXXXX
-------------------------------
Title: PRESIDENT, C.O.O.
-----------------
GREENWICH CAPITAL FINANCIAL
PRODUCTS, INC.,
LENDER
By: /s/ XXXXXXX XXXXXXX
-------------------------------
Name: XXXXXXX XXXXXXX
-------------------------------
Title: SVP
-------------------------------
Exhibit 10.96
EXHIBIT A
FORM OF BORROWER'S OFFICER'S CERTIFICATE
I, ________________, hereby certify that I am the duly elected
________________ of E-Loan, Inc., a Delaware corporation (the "BORROWER"), and
further certify, on behalf of the Borrower as follows:
1. Each person who, as an officer or attorney-in-fact of the
Borrower, signed (a) Amendment Number Two (the "AMENDMENT") to the Master
Loan and Security Agreement (as amended, the "LOAN AGREEMENT"), dated as
of February 22, 2001, by and between the Borrower and Greenwich Capital
Financial Products, Inc. (the "LENDER"); (b) the Securitization Letter,
dated February __, 2001 by and between the Borrower and the Lender; and
(c) any other document delivered prior hereto or on the date hereof in
connection with transactions contemplated in the Loan Agreement was, at
the respective times of such signing and delivery, and is as of the date
hereof, duly elected or appointed, qualified and acting as such officer
or attorney-in-fact, and the signatures of such persons appearing on such
documents are their genuine signatures.
2. All of the representations and warranties of the Borrower
contained in Section 6 of the Loan Agreement were true and correct in all
material respects as of the date of the Amendment and are true and
correct in all material respects as of the date hereof.
3. The Borrower has performed all of its duties and has
satisfied all the material conditions on its part to be performed or
satisfied pursuant to Section 5 of the Loan Agreement.
4. As of the date of the Amendment and as of the date hereof,
no Default or Event of Default exists under the Loan Agreement.
5. There are no actions, suits or proceedings pending or, to
my knowledge, threatened, against or affecting the Borrower which, if
adversely determined either individually or in the aggregate, would
adversely affect the Borrower's obligations under the Loan Agreement. No
proceedings that could result in the liquidation or dissolution of the
Borrower are pending or contemplated.
All capitalized terms used herein and not otherwise defined shall
have the meaning assigned to them in the Loan Agreement.
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IN WITNESS WHEREOF, I have hereunto signed my name and affixed the
seal of the Borrower.
Dated: February __, 2001
[Seal]
E-LOAN, INC.
By:
---------------------------------
Name
Title:
I, ___________________, _________ of E-Loan, Inc., hereby certify
that ________________ is the duly elected, qualified and acting _______________
of E-Loan, Inc. and that the signature appearing above is the genuine signature
of such person.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: February __, 2001
[Seal]
E-LOAN, INC.
By:
---------------------------------
Name
Title:
