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SPECIFIC TERMS AND CONDITIONS OF SERVICING
among
FLC FINANCIAL CORP. II
("Issuer")
and
FEDERAL LEASING CORP.
("Servicer")
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
("Back-up Servicer")
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
("Indenture Trustee")
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Dated as of March 1, 1996
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SPECIFIC TERMS AND CONDITIONS OF SERVICING, dated as of March 1, 1996,
by and among FLC Financial Corp. II, a Delaware corporation (the "Issuer"),
Federal Leasing Corp., a New Jersey corporation, as the Servicer hereunder (the
"Servicer"), Norwest Bank Minnesota, National Association, a national banking
association (the "Back-up Servicer") and Norwest Bank Minnesota, National
Association, a national banking association, as trustee (the "Indenture
Trustee") under the Indenture (defined below).
PRELIMINARY STATEMENT
This Specific Terms and Conditions of Servicing (the "Specific
Servicing Terms") is intended to incorporate by reference all of the provisions
of the Standard Terms and Conditions of Servicing attached hereto as Appendix 1
(the "Standard Servicing Terms") and the definitions in Appendix X. Together the
Specific Servicing Terms and the Standard Servicing Terms are intended to form
the Servicing Agreement entered into in connection with the financing described
below.
The Issuer has entered into an Indenture dated as of March 1, 1996,
(the "Indenture"), with the Indenture Trustee, the Back-up Servicer and the
Servicer, pursuant to which the Issuer intends to issue one or more Series of
Notes (the "Notes").
The Issuer and Federal Leasing Corp. (the "Company") have entered into
a Lease Acquisition Agreement dated as of March 1, 1996 (the "Lease Acquisition
Agreement"), providing for, among other things, the contribution and sale, from
time to time, by the Company to the Issuer of all of its right, title and
interest in and to certain Lease Assets which the Issuer is and will be pledging
with the Indenture Trustee, and in which the Issuer will be granting to the
Indenture Trustee a security interest, as security for the Notes. As a
precondition to the effectiveness of such Lease Acquisition Agreement, the Lease
Acquisition Agreement requires that the Servicer, the Issuer, the Indenture
Trustee and the Back-up Servicer enter into the Servicing Agreement to provide
for the servicing of the Lease Assets.
In order to further secure the Notes, the Issuer is granting to the
Indenture Trustee a security interest in, among other things, the Issuer's
rights derived under the Servicing Agreement and the Lease Acquisition
Agreement, and the Servicer agrees that all covenants and agreements made by the
Servicer herein with respect to the Lease Assets shall also be for the benefit
and security of the Indenture Trustee, MBIA and all Holders from time to time of
the Notes. For its services under the Servicing Agreement, the Servicer will
receive a Servicer Fee as provided herein and in the Indenture. For its services
hereunder the Back-up Servicer will receive a Back-up Servicer Fee as provided
herein and in the Indenture.
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Section 1. Specific Definitions and Designations
"ACH Bank": None.
"Back-up Servicer": shall initially mean Norwest Bank Minnesota,
National Association.
"Company": shall mean Federal Leasing Corp.
"Indenture Trustee": shall initially mean Norwest Bank Minnesota,
National Association.
"Initial Net Worth Standard": shall mean that the Reported Companies'
total net worth, consisting of preferred stock and warrants and shareholders'
equity, as reflected in the most recent Reported Companies' Financial
Statements, is equal to at least $1,300,000.
"Issuer": shall mean FLC Financial Corp. II.
"Reported Companies": shall mean Federal Leasing Corp., New Jersey
Mortgage Investment Corp. ("NJMIC"), and any other wholly-owned subsidiary of
the Company, on a consolidated basis, and in addition, any successor Servicer
appointed pursuant to the Servicing Agreement.
"Servicer": shall initially mean Federal Leasing Corp.
"Servicer State of Incorporation": is New Jersey.
Section 2. The Servicer Fee
The Servicer Fee shall be equal to $5.00 per Lease Contract, per
Scheduled Payment; provided, however, that if the Servicer is anyone other than
Federal Leasing Corp. or one of its affiliates, (i) the Servicer Fee shall be
equal to the lesser of (a) $5.00 per Lease Contract, per Scheduled Payment or
(b) the fee provided for in Section 6.02 of the Standard Servicing Terms and
(ii) such successor Servicer shall be entitled to any Additional Servicer Fee as
provided in the Standard Servicing Terms.
Section 3. Commencement of Independent Accounting Reports
The annual independent accountants' reports referred to in Section 4.03
of the Standard Servicing Terms shall commence with the fiscal year ended
February 28, 1997.
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Section 4. Addresses for Notices
All demands, notices and communications referred to in Section 8.04 of
the Standard Servicing Terms shall be addressed as follows:
(a) if to the Issuer, at 0 Xxxxxx Xxxx Xxxx, Xxxxx X, Xxxxxxxx, Xxx
Xxxxxx 00000, Attention: President;
(b) if to the Servicer, at 0 Xxxxxx Xxxx Xxxx, Xxxxxxxx, Xxx Xxxxxx
00000, Attention: President;
(c) if to the Back-up Servicer, at 0xx Xxxxxx & Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx, 00000-0000, Attention: Corporate Trust Department;
(d) if to the Indenture Trustee, at 0xx Xxxxxx & Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000, Attention: Corporate Trust Department;
(e) if to any Noteholder, at its address for notices specified in the
Note Register;
(f) if to the Rating Agencies, at Standard & Poor's. 00 Xxxxxxxx, Xxx
Xxxx, XX 00000 and Moody's, 00 Xxxxxx Xxxxxx, Xxx Xxxx, XX 00000.
(g) if to MBIA, at MBIA Insurance Corporation, 000 Xxxx Xxxxxx,
Xxxxxx, XX 00000, Attention: Insurance Portfolio Management--Structured Finance
(IPM-SF).
Any of the Persons in subclauses (a) through (g) above may change the
address for notices hereunder by giving notice of such change to the other
Persons. Any change of address shown on the Note Register shall, after the date
of such change, be effective to change the address for such Noteholder
hereunder.
Section 5. Servicing Agreement Comprised of Specific Servicing Terms
and Standard Servicing Terms
This Specific Servicing Terms incorporates by reference all of the
provisions of the Standard Servicing Terms attached hereto as Appendix 1 and the
definitions set forth in Appendix X, which together form the Servicing
Agreement. Notwithstanding the foregoing, if any provision of the Standard
Servicing Terms conflicts with the provisions of the Specific Servicing Terms,
the provisions of the Specific Servicing Terms shall control.
Section 6. Counterparts
This Specific Servicing Terms which together with the Standard
Servicing Terms form the Servicing Agreement (the "Servicing Agreement") which
may be executed in one or more counterparts all of which together shall
constitute one original document.
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IN WITNESS WHEREOF, the Issuer, the Servicer, the Back-up Servicer and
the Indenture Trustee have caused this Servicing Agreement to be duly executed
by their respective officers thereunto duly authorized as of the date and year
first above written.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, Indenture Trustee
By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx
Title: Assistant Vice President
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, Back-up Servicer
By: /s/ Xxxxxx Xxxxxxxx
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Name: Xxxxxx Xxxxxxxx
Title: Assistant Vice President
FLC FINANCIAL CORP. II
Issuer
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: President
FEDERAL LEASING CORP.,
Servicer
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title: Chairman
