AMENDED AND RESTATED GUARANTY
Exhibit
10.3
This
AMENDED AND RESTATED GUARANTY is made and entered into by Anthracite Capital,
Inc., a Maryland corporation whose address is c/o BlackRock Financial
Management, Inc., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“Guarantor”),
for
the benefit of Bank of America, N.A., whose address is Mail Code NC1-027-19-01,
Hearst Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 (the
“Buyer
Agent”)
for
the benefit of Bank of America, N.A. (“BANA”)
and
Banc of America Mortgage Capital Corporation (“BAMCC”,
individually and/or collectively, as the context may require, each a
“Buyer”
and
collectively, the “Buyers”).
This
Guaranty is made with reference to the following facts (with some capitalized
terms being defined below):
WHEREAS,
Anthracite
Capital BOFA Funding LLC, a Delaware limited liability company whose address
is
c/o BlackRock Financial Management, Inc., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (“Seller”)
is
party to that certain Master Repurchase Agreement between Seller, the Buyer
Agent and Buyers dated July 20, 2007, together with all annexes thereto (as
amended, modified and in effect prior to the date hereof, the “Existing
Repurchase Agreement”;
as
amended by the Amendment and Agreement, dated as of the date hereof (the
“Amendment”)
and as
further amended, modified and in effect from time to time, the “Repurchase
Agreement”).
Capitalized terms used but not defined herein, shall have the meanings ascribed
to such terms in the Repurchase Agreement.
WHEREAS,
in
connection with the Existing Repurchase Agreement, the Guarantor executed and
delivered that certain Guaranty, dated as of July 20, 2007 (as amended, modified
and in effect prior to the date hereof, the “Existing
Guaranty”).
WHEREAS,
the
Seller, the Buyer
Agent and the Buyers have amended the Existing Repurchase Agreement pursuant
to
the terms of the Amendment.
WHEREAS,
it
is a
requirement under the Amendment that the Existing Guaranty be amended and
restated as provided herein and it is a condition precedent to the effectiveness
of the Amendment that the Guarantor shall have executed and delivered this
Guaranty to the Buyer Agent.
WHEREAS,
Guarantor is the direct owner of 100% of the membership interests of
Seller.
WHEREAS,
Guarantor expects to benefit if the Seller, the Buyer Agent and the Buyers
amend
the Repurchase Agreement, and desires that the Buyer Agent and the Buyers amend
the Repurchase Agreement, pursuant to the terms of the Amendment.
WHEREAS,
the
Buyer Agent and the Buyers would not amend, and would not be obligated to amend,
the Repurchase Agreement with Seller unless Guarantor executed this Guaranty.
This Guaranty is therefore delivered to the Buyer Agent to induce the Buyer
Agent and the Buyers to amend the Repurchase Agreement pursuant to the terms
of
the Amendment.
NOW,
THEREFORE,
in
exchange for good, adequate, and valuable consideration, the receipt of which
Guarantor acknowledges, and to induce the Buyer Agent and the Buyers to enter
into the Amendment and accept the Repurchase Agreement and the other Transaction
Documents, Guarantor agrees as follows:
1. DEFINITIONS.
For
purposes of this Guaranty, the following terms shall be defined as set forth
below. In addition, any capitalized term defined in the Repurchase Agreement
but
not defined in this Guaranty shall have the same meaning in this Guaranty as
in
the Repurchase Agreement.
1.1 “Adjusted
Net Income”
means,
for any period, the Net Income of Guarantor and its consolidated Subsidiaries
for such period, determined on a cash basis for such period without recognizing
any trading portfolio gains or losses in general, and specifically without
giving effect to:
(a) depreciation
and amortization,
(b) gains
or
losses that are classified as “extraordinary” in accordance with
GAAP,
(c) capital
gains or losses on sales of real estate,
(d) capital
gains or losses with respect to the disposition of investments in marketable
securities,
(e) any
provision/benefit for income taxes for such period,
(f) earnings
from equity investments and unconsolidated joint ventures determined in
accordance with GAAP,
(g) losses
attributable to the impairment of assets,
(h) incentive
fees paid in the form of the issuance of the Guarantor’s common
stock,
(i) Cash
Interest Expense,
(j) income
or
expense attributable to the ineffectiveness of hedging transactions,
and
(k) interest
accretions, whether in favor or against the Guarantor.
Without
limiting the foregoing, Net Income shall be determined before preferred stock
dividends and shall include cash distributions from equity investments and
unconsolidated joint ventures.
1.2 “Capital
Lease Obligations”
means,
for any Person, all obligations of such Person to pay rent or other amounts
under a lease of (or other agreement conveying the right to use) Property to
the
extent such obligations are required to be classified and accounted for as
a
capital lease on a balance sheet of such Person under GAAP, and for purposes
of
this Guaranty, the amount of such obligations shall be the capitalized amount
thereof, determined in accordance with GAAP.
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1.3 “Cash
Interest Expense”
means,
for any period, total interest expense, both expensed and capitalized, of
Guarantor and its Subsidiaries for such period with respect to the Total
Recourse Indebtedness, determined on a consolidated cash basis, for such period,
and net of any interest accretions, whether in favor or against, with respect
to
debt.
1.4 “Committed
Facility”
shall
mean a credit facility under which Guarantor is a borrower and a party
acceptable to Buyer Agent is lender, whereby (i) the lender thereunder is
unconditionally committed to make advances to Guarantor upon request by
Guarantor (other than any conditions acceptable to Buyer Agent); (ii) no event
of default (or event which with notice or the passage of time, or both, would
constitute an event of default) has occurred thereunder; and (iii) the period
where such advances may be requested expires more than ninety (90) days from
the
date of determination.
1.5 “Debt
Service Coverage Ratio”
or
“DSCR”
means,
for any period, the ratio of Adjusted Net Income to Cash Interest Expense on
the
Total Recourse Indebtedness outstanding, it being understood that such
determination shall be made on a cash basis.
1.6 “Equity
Proceeds”
means
any proceeds received from the sale or issuance of any capital
stock.
1.7 “Guarantied
Obligations”
means
Seller’s obligations: (a) to fully and promptly pay all sums owed under the
Transaction Documents at the times and according to the terms required by the
Transaction Documents, without regard to any modification, suspension, or
limitation of such terms not agreed to by the Buyer Agent, such as a
modification, suspension, or limitation arising in or pursuant to any Insolvency
Proceeding affecting Seller (even if any such modification, suspension, or
limitation causes Seller’s obligation to become discharged or unenforceable and
even if such modification was made with the Buyer Agent’s consent or agreement);
and (b) to perform all other obligations contained in the Transaction
Documents, whether monetary or nonmonetary, when and as required by the
Transaction Documents, including all obligations of Seller relating to the
Repurchase Transactions and the Security under the Transaction
Documents.
1.8 “Indebtedness”
means,
for any Person without duplication: (a) obligations created, issued or incurred
by such Person for borrowed money (whether by loan, the issuance and sale of
debt securities or the sale of Property to another Person subject to an
understanding or agreement, contingent or otherwise, to repurchase such Property
from such Person); (b) obligations of such Person to pay the deferred purchase
or acquisition price of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in
the
ordinary course of business so long as such trade accounts payable are payable
within ninety (90) days after the date the respective goods are delivered or
the
respective services are rendered; (c) Indebtedness of others secured by a Lien
on the Property of such Person, whether or not the respective Indebtedness
so
secured has been assumed by such Person; (d) obligations (contingent or
otherwise) of such Person in respect of letters of credit or similar instruments
issued or accepted by banks and other financial institutions for account of
such
Person; (e) Capital Lease Obligations of such Person; (f) obligations of such
Person under repurchase agreements, sale/buy-back agreements or like
arrangements; (g) Indebtedness of others guarantied by such Person; (h) all
obligations of such Person incurred in connection with the acquisition or
carrying of fixed assets by such Person; (i) Indebtedness of general
partnerships of which such Person is a general partner; (j) net liabilities
under Hedging Agreements, as determined in accordance with GAAP; and (k) all
Off-Balance Sheet Obligations of such Person
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1.9 “Insolvency
Proceeding”
means
any case under Title 11 of the United States Code or any successor statute
or any other insolvency, bankruptcy, reorganization, liquidation, or like
proceeding, or other statute or body of law relating to creditors’ rights,
whether brought under state, federal, or foreign law.
1.10 “Intangible
Assets”
means
the excess of the cost over book value of assets acquired, patents, trademarks,
trade names, copyrights, franchises and other intangible assets (excluding
in
any event the value of any residual securities).
1.11 “Liens”
means
any mortgage, lien, pledge, charge, security interest or similar
encumbrance.
1.12 “Xxxx-to-Market
Indebtedness”
means
the portion of Total Indebtedness of the Guarantor (which may be all of such
Indebtedness) where the terms thereunder permit the holder thereof to make
a
margin call, accelerate all or part of such Indebtedness and/or request the
repayment in full or in part prior to the applicable maturity date based on
changes in the market value of the collateral securing such
Indebtedness.
1.13 “Marketable
Securities”
means
any of the following:
(i) 100%
of
the market value of negotiable debt obligations issued by the U.S. Treasury
Department having a remaining maturity of less than 1 year; or
(ii) 95%
of
the market value of negotiable debt obligations issued by the U.S. Treasury
Department having a remaining maturity of 1-10 years; or
(iii) 90%
of
the market value of negotiable debt obligations issued by the U.S. Treasury
Department having a remaining maturity of more than 10 years; or
(iv) 90%
of
the market value of single-class mortgage participation certificates
(“FHLMC
Certificates”)
in
book-entry form backed by single-family residential mortgage loans, the full
and
timely payment of interest at the applicable certificate rate and the ultimate
collection of principal of which are guaranteed by the Federal Home Loan
Mortgage Corporation (excluding Real Estate Mortgage Investment Conduit
("REMIC")
or
other multi-class pass-through certificates, collateralized mortgage
obligations, pass-through certificates backed by adjustable rate mortgages,
securities paying interest or principal only and similar derivative securities);
or
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(v) 90%
of
the market value of single-class mortgage pass-through certificates
(“FNMA
Certificates”)
in
book-entry form backed by single-family residential mortgage loans, the full
and
timely payment of interest at the applicable certificate rate and ultimate
collection of principal of which are guaranteed by the Federal National Mortgage
Association (excluding REMIC or other multi-class pass-through certificates,
pass-through certificates backed by adjustable rate mortgages collateralized
mortgage obligations, securities paying interest or principal only and similar
derivative securities); or
(vi) 90%
of
the market value of single-class fully modified pass-through certificates
(“GNMA
Certificates”)
in
book-entry form backed by single-family residential mortgage loans, the full
and
timely payment of principal and interest of which is guaranteed by the
Government National Mortgage Association (excluding REMIC or other multi-class
pass-through certificates, collateralized mortgage obligations, pass-through
certificates backed by adjustable rate mortgages, securities paying interest
or
principal only and similar derivatives securities); or
(vii) 85%
of
all actively and regularly traded investment-grade residential mortgage-backed
securities; or
(viii) such
other collateral as Guarantor and Buyer Agent may agree, with such valuation
percentage applied thereto as Buyer Agent, in its sole discretion acting in
good
faith shall deem appropriate.
1.14 “Net
Income”
means,
for any period and for Guarantor and its consolidated Subsidiaries, the
consolidated net income (or loss) of Guarantor and its consolidated Subsidiaries
for such period as determined on a consolidated basis in accordance with GAAP
as
adjusted in accordance with the terms hereof.
1.15 “Non-Recourse
Indebtedness”
means,
with respect to any Person, Indebtedness for borrowed money in respect of which
recourse for payment (except for customary exceptions for fraud, misapplication
of funds, environmental indemnities, and other customary exceptions to
non-recourse provisions) is contractually limited to specific assets encumbered
by a Lien securing such Indebtedness.
1.16 “Off-Balance
Sheet Obligations”
mean,
with respect to any Person and its consolidated Subsidiaries determined on
a
consolidated basis as of any date of determination thereof, without duplication
and to the extent not included as a liability on the consolidated balance sheet
of such Person and its consolidated Subsidiaries in accordance with GAAP: (a)
the monetary obligations under any financing lease or so-called “synthetic”,
tax
retention or off-balance sheet lease transaction which, upon the application
of
any insolvency laws to such Person or any of its consolidated Subsidiaries,
would be characterized as indebtedness; (b) the monetary obligations under
any
sale and leaseback transaction which does not create a liability on the
consolidated balance sheet of such Person and its consolidated Subsidiaries;
or
(c) any other monetary obligation arising with respect to any other transaction
which (i) is characterized as indebtedness for tax purposes but not for
accounting purposes in accordance with GAAP or (ii) is the functional equivalent
of or takes the place of borrowing but which does not constitute a liability
on
the consolidated balance sheet of such Person and its consolidated Subsidiaries
(for purposes of this clause
(c),
any
transaction structured to provide tax deductibility as interest expense of
any
dividend, coupon or other periodic payment shall be deemed to be the functional
equivalent of a borrowing).
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1.17 “Property”
means
any right or interest in or to property of any kind whatsoever, whether real,
personal or mixed and whether tangible or intangible.
1.18 “Security”
means
any security or collateral held by or for the Buyer Agent, for the benefit
of
the Buyers, for the Repurchase Transactions or the Guarantied Obligations,
whether real or personal property, including any mortgage, deed of trust,
financing statement, security agreement, and other security document or
instrument of any kind securing the Repurchase Transactions in whole or in
part.
1.19 “Seller”
means:
(a) Seller as defined above, acting on its own behalf; (b) any estate
created by the commencement of an Insolvency Proceeding affecting Seller;
(c) any trustee, liquidator, sequestrator, or receiver of Seller or
Seller’s property; and (d) any similar person duly appointed pursuant to
any law governing any Insolvency Proceeding of Seller.
1.20 “Subsidiary”
means,
as to any Person, a corporation, partnership, limited liability company or
other
entity of which shares of stock or other ownership interests having ordinary
voting power (other than stock or such other ownership interests having such
power only by reason of a contingency) to elect a majority of the board of
directors or other managers of such corporation, partnership, limited liability
company or other entity are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or more intermediaries,
or both, by such Person
1.21 “Tangible
Net Worth”
means,
as of a particular date, (i) all amounts that would be included under
stockholder’s equity on a balance sheet of Guarantor and its consolidated
Subsidiaries at such date, determined in accordance with GAAP, less
(ii) the
sum of (A) amounts owing to Guarantor and its consolidated Subsidiaries from
Affiliates and (B) Intangible Assets of Guarantor and its consolidated
Subsidiaries.
1.22 “Tangible
Net Worth Ratio”
shall
have the meaning provided in Section 5.2 of this Guaranty.
1.23 “Total
Recourse Indebtedness”
means,
for any period, the aggregate Indebtedness (excepting any Non-Recourse
Indebtedness) of Guarantor and its consolidated Subsidiaries during such
period.
1.24 “Unfunded
Margin Amount”
means,
in respect of any Eligible Asset on any date of determination, the positive
difference, if any, between (a) the Market Value in respect of such Eligible
Asset and (b) the outstanding Repurchase Price for such Eligible
Asset.
2. ABSOLUTE
GUARANTY OF ALL GUARANTIED OBLIGATIONS. Guarantor
unconditionally and irrevocably guarantees Seller’s prompt and complete payment,
observance, fulfillment, and performance of all Guarantied Obligations.
Guarantor shall be personally liable for, and personally obligated to pay and
perform, all Guarantied Obligations. All assets and property of Guarantor shall
be subject to recourse if Guarantor fails to pay and perform any Guarantied
Obligation(s) when and as required to be paid and performed pursuant to the
Transaction Documents.
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3. NATURE
AND SCOPE OF LIABILITY. Guarantor’s
liability under this Guaranty is primary and not secondary. Guarantor’s
liability under this Guaranty shall be in the full amount of all Guarantied
Obligations, including any interest, default interest, costs and fees payable
by
Seller under the Transaction Documents, including any of the foregoing that
would have accrued under the Transaction Documents but for any Insolvency
Proceeding.
4. CHANGES
IN TRANSACTION DOCUMENTS. Without
notice to, or consent by, Guarantor, and in the Buyer Agent’s sole and absolute
discretion and without prejudice to the Buyer Agent or in any way limiting
or
reducing Guarantor’s liability under this Guaranty, but subject to the terms of
the Repurchase Agreement, the Buyer Agent, on behalf of the Buyers, may:
(a) grant extensions of time, renewals or other indulgences or
modifications to Seller or any other party under any of the Transaction
Document(s), (b) change, amend, or modify any Transaction Document(s),
(c) authorize the sale, exchange, release or subordination of any Security,
(d) accept or reject additional Security in accordance with the terms of
the Repurchase Agreement, (e) discharge or release any party or parties
liable under the Transaction Documents, (f) foreclose or otherwise realize
on any Security, or attempt to foreclose or otherwise realize on any Security,
whether such attempt is successful or unsuccessful, in accordance with the
terms
of the Repurchase Agreement, (g) accept or make compositions or other
arrangements or file or refrain from filing a claim in any Insolvency
Proceeding, (h) make loans to Seller in such amount(s) and at such time(s)
as the Buyer Agent may determine, (i) credit payments in such manner and
order of priority as the Buyer Agent may determine in its discretion,
provided
that
such credits shall be consistent with the requirements of the Repurchase
Agreement and (j) otherwise deal with Seller and any other party related to
the Repurchase Transactions or any Security as the Buyer Agent may determine
in
its sole and absolute discretion. Without limiting the generality of the
foregoing, Guarantor’s liability under this Guaranty shall continue even if the
Buyer Agent alters any obligations under the Transaction Documents in any
respect or any Buyer’s, the Buyer Agent’s or Guarantor’s remedies or rights
against Seller are in any way impaired or suspended without Guarantor’s consent.
If the Buyer Agent performs any of the actions described in this paragraph,
then
Guarantor’s liability shall continue in full force and effect even if the Buyer
Agent’s actions impair, diminish or eliminate Guarantor’s subrogation,
contribution, or reimbursement rights (if any) against Seller.
5. CERTAIN
FINANCIAL COVENANTS. Guarantor
shall satisfy with respect to itself each of the following financial covenants,
as determined quarterly on a consolidated basis in conformity with GAAP as
set
forth in the financial statements of Guarantor delivered pursuant to
Section 15
hereof:
5.1 Maintenance
of Tangible Net Worth.
Tangible Net Worth at the end of each fiscal quarter shall not be less than
the
sum of (i) $400,000,000, plus,
(ii) an
amount equal to 75% of any Equity Proceeds;
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5.2 Maintenance
of Ratio of Total Recourse Indebtedness to Tangible Net Worth.
The
ratio of Total Recourse Indebtedness to Tangible Net Worth (the “Tangible
Net Worth Ratio”)
at the
end of each fiscal quarter shall not be greater than 3.0:1.0;
5.3 Changes
in Tangible Net Worth.
On any
date, the Guarantor’s Tangible Net Worth shall not have decreased by (i) twenty
percent (20%) or more from the Guarantor’s Tangible Net Worth as of the last
Business Day in the third (3rd)
month
preceding such date; or (ii) forty percent (40%) or more from the Guarantor’s
Tangible Net Worth as of the last Business Day in the twelfth (12th)
month
preceding such date;
5.4 Minimum
DSCR.
DSCR at
the end of each fiscal quarter shall not be less than 1.40:1.00;
5.5 Minimum
Liquidity.
As of
any date, the sum of the Guarantor’s (x) cash, (y) Marketable Securities, and
(z) subject to the following proviso, availability under any Committed Facility
that is unrestricted and not subject to liens, to be less than 5.0% of the
Guarantor’s Indebtedness which is subject to xxxx-to-market provisions;
provided, however¸ that the maximum amount of availability under any Committed
Facility that is unrestricted and not subject to liens that may be included
for
purposes of satisfying the requirements of this Section
5.5
shall
not exceed 1.25% of the Guarantor’s Indebtedness which is subject to
xxxx-to-market provisions; and
5.6 Net
Income.
For any
period of two consecutive fiscal quarters, Guarantor’s Net Income shall not be
less than $1.00.
5.7 Accounting
Adjustments.
Compliance with Sections 5.1 through 5.6 above shall be determined by excluding
the assets and liabilities of variable interest entities required to be
consolidated under FIN 46R and without giving any effect to any changes in
or in
the interpretation of FAS 140 after the date hereof.
6. NATURE
OF GUARANTY. Guarantor’s
liability under this Guaranty is a guaranty of payment and performance of the
Guarantied Obligations, and is not a guaranty of collection or collectability.
Guarantor’s liability under this Guaranty is not conditioned or contingent upon
the genuineness, validity, regularity or enforceability of any of the
Transaction Documents. Guarantor’s liability under this Guaranty is a
continuing, absolute, and unconditional obligation under any and all
circumstances whatsoever (except as expressly stated, if at all, in this
Guaranty), without regard to the validity, regularity or enforceability of
any
of the Guarantied Obligations. Guarantor acknowledges that Guarantor is fully
obligated under this Guaranty even if Seller had no liability at the time of
execution of the Transaction Documents or later ceases to be liable under any
Transaction Document, whether pursuant to Insolvency Proceedings or otherwise.
Guarantor shall not be entitled to claim, and irrevocably covenants not to
raise
or assert, any defenses against the Guarantied Obligations that would or might
be available to Seller, other than actual payment and performance of all
Guarantied Obligations in full in accordance with their terms. Guarantor waives
any right to compel the Buyer Agent to proceed first against Seller or any
Security before proceeding against Guarantor. Guarantor agrees that if any
of
the Guarantied Obligations are or become void or unenforceable (because of
inadequate consideration, lack of capacity, Insolvency Proceedings, or for
any
other reason), then Guarantor’s liability under this Guaranty shall continue in
full force with respect to all Guarantied Obligations as if they were and
continued to be legally enforceable, all in accordance with their terms before
giving effect to the Insolvency Proceedings. Guarantor also recognizes and
acknowledges that its liability under this Guaranty may be more extensive in
amount and more burdensome than that of Seller. Guarantor waives any defense
that might otherwise be available to Guarantor based on the proposition that
a
guarantor’s liability cannot exceed the liability of the principal. Guarantor
intends to be fully liable under the Guarantied Obligations regardless of the
scope of Seller’s liability thereunder. Without limiting the generality of the
foregoing, if the Guarantied Obligations are “nonrecourse”
as
to
Seller or Seller’s liability for the Guarantied Obligations is otherwise limited
in some way, Guarantor nevertheless intends to be fully liable, to the full
extent of all of Guarantor’s assets, with respect to all the Guarantied
Obligations, even though Seller’s liability for the Guarantied Obligations may
be more limited in scope or less burdensome. Guarantor waives any defenses
to
this Guaranty arising or purportedly arising from the manner in which any Buyer
or the Buyer Agent disburses the Repurchase Transactions to Seller or otherwise,
or any waiver of the terms of any Transaction Document by the Buyer Agent or
other failure of the Buyer Agent to require full compliance with the Transaction
Documents. Guarantor’s liability under this Guaranty shall continue until all
sums due under the Transaction Documents have been paid in full and all other
performance required under the Transaction Documents has been rendered in full,
except as expressly provided otherwise (if at all) in this Guaranty. Guarantor’s
liability under this Guaranty shall not be limited or affected in any way by
any
impairment or any diminution or loss of value of any Security whether caused
by
(a) hazardous substances, (b) the Buyer Agent’s failure to perfect a
security interest in any Security, (c) any disability or other defense(s)
of Seller, (d) any acts or omissions of the Buyers or the Buyer Agent; or
(e) any breach by Seller of any representation or warranty contained in any
Transaction Document.
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7. WAIVERS
OF RIGHTS AND DEFENSES. Guarantor
waives any right to require the Buyer Agent or any Buyer to (a) proceed
against Seller, (b) proceed against or exhaust any Security, or
(c) pursue any other right or remedy for Guarantor’s benefit. Guarantor
agrees that the Buyer Agent may proceed against Guarantor with respect to the
Guarantied Obligations without taking any actions against Seller and without
proceeding against or exhausting any Security. Guarantor agrees that the Buyer
Agent may unqualifiedly exercise in its sole discretion (or may waive or
release, intentionally or unintentionally) any or all rights and remedies
available to it against Seller without impairing the Buyer Agent’s rights and
remedies in enforcing this Guaranty, under which Guarantor’s liabilities shall
remain independent and unconditional. Guarantor agrees and acknowledges that
the
Buyer Agent’s exercise (or waiver or release) of certain of such rights or
remedies may affect or eliminate Guarantor’s right of subrogation or recovery
against Seller (if any) and that Guarantor may incur a partially or totally
nonreimbursible liability in performing under this Guaranty. Guarantor has
assumed the risk of any such loss of subrogation rights, even if caused by
the
Buyer Agent’s acts or omissions. If the Buyer Agent’s enforcement of rights and
remedies, or the manner thereof, limits or precludes Guarantor from exercising
any right of subrogation that might otherwise exist, then the foregoing shall
not in any way limit the Buyer Agent’s rights to enforce this Guaranty. Without
limiting the generality of any other waivers in this Guaranty, Guarantor
expressly waives any statutory or other right that Guarantor might otherwise
have to: (i) limit Guarantor’s liability after a nonjudicial foreclosure
sale conducted in accordance with the terms of the Repurchase Agreement and
applicable law to the difference between the Guarantied Obligations and the
fair
market value of the property or interests sold at such nonjudicial foreclosure
sale or to any other extent, (ii) otherwise limit the Buyer Agent’s right
to recover a deficiency judgment after any foreclosure sale conducted in
accordance with the terms of the Repurchase Agreement and applicable law, or
(iii) require the Buyer Agent to exhaust its Security before the Buyer
Agent may obtain, for the benefit of the Buyers, a personal judgment for any
deficiency. Notwithstanding anything in the Repurchase Agreement to the
contrary, any proceeds of a foreclosure or similar sale shall be applied first
to any obligations of Seller that also constitute Guarantied Obligations within
the meaning of this Guaranty. Guarantor acknowledges and agrees that any
nonrecourse or exculpation provided for in any Transaction Document, or any
other provision of a Transaction Document limiting the Buyer Agent’s recourse to
specific Security or limiting the Buyer Agent’s right to enforce a deficiency
judgment against Seller or any other person, shall have absolutely no
application to Guarantor’s liability under this Guaranty.
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8. ADDITIONAL
WAIVERS. Guarantor
waives diligence and all demands, protests, presentments and notices of every
kind or nature, including notices of protest, dishonor, nonpayment, acceptance
of this Guaranty and the creation, renewal, extension, modification or accrual
of any of the Guarantied Obligations. Guarantor further waives the right to
plead any and all statutes of limitations as a defense to Guarantor’s liability
under this Guaranty or the enforcement of this Guaranty. No failure or delay
on
the Buyer Agent’s part in exercising any power, right or privilege under this
Guaranty shall impair or waive any such power, right or privilege.
9. NO
DUTY TO PROVE LOSS. To
the
extent that Guarantor at any time incurs any liability under this Guaranty,
Guarantor shall immediately pay the Buyer Agent (to be applied on account of
the
Guarantied Obligations) the amount provided for in this Guaranty, without any
requirement that the Buyer Agent demonstrate that the Buyer Agent or any Buyer
has currently suffered any loss or that the Buyer Agent or any Buyer has
otherwise exercised (to any degree) or exhausted any of the Buyer Agent’s or
Buyers’ rights or remedies with respect to Seller or any Security.
10. FULL
KNOWLEDGE. Guarantor
acknowledges, represents, and warrants that Guarantor has had a full and
adequate opportunity to review the Transaction Documents, the transactions
contemplated by the Transaction Documents, and all underlying facts relating
to
such transactions. Guarantor represents and warrants that Guarantor fully
understands: (a) the remedies the Buyer Agent and/or the Buyers may pursue
against Seller and/or Guarantor in the event of a default under the Transaction
Documents, (b) the value (if any) and character of any Security and
(c) Seller’s financial condition and ability to perform under the
Transaction Documents. Guarantor agrees to keep itself fully informed regarding
all aspects of the foregoing and the performance of Seller’s obligations to the
Buyer Agent and the Buyers. Neither Buyer Agent nor any Buyer has a duty,
whether now or in the future, to disclose to Guarantor any information
pertaining to Seller, the Repurchase Transactions or any Security. If at any
time provided for in the Transaction Documents, Guarantor agrees and
acknowledges that an Insolvency Proceeding affecting Guarantor, or other actions
or events relating to Guarantor (including Guarantor’s change in financial
position), as set forth in the Transaction Documents, may be event(s) of default
under the Transaction Documents.
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11. REPRESENTATIONS
AND WARRANTIES. Guarantor
acknowledges, represents, and warrants as follows, and acknowledges that the
Buyer Agent is relying upon the following acknowledgments, representations,
and
warranties by Guarantor in making the Repurchase Transactions:
11.1 Due
Authorization.
This
Guaranty has been duly authorized, executed, and delivered by Guarantor, and
is
a legally valid and binding obligation of Guarantor, enforceable against
Guarantor in accordance with its terms, subject to bankruptcy, insolvency and
other limitations on creditors’ rights generally and to equitable
principles.
11.2 No
Conflict.
The
execution, delivery, and performance of this Guaranty will not violate any
provision of any law, regulation, judgment, order, decree, determination, or
award of any court, arbitrator or governmental authority, or of any mortgage,
indenture, loan, or security agreement, lease, contract or other agreement,
instrument or undertaking to which Guarantor is a party or that purports to
bind
Guarantor or any of Guarantor’s property or assets.
11.3 No
Third Party Consent Required.
No
consent of any person (including creditors or partners, members, stockholders
or
other owners of Guarantor) is required in connection with Guarantor’s execution
of this Guaranty or performance of Guarantor’s obligations under this Guaranty
(other than consents that have been obtained). Guarantor’s execution of, and
obligations under, this Guaranty are not contingent upon any consent, license,
permit, approval or authorization of, exemption by, notice or report to or
registration, filing or declaration with, any governmental authority, bureau
or
agency, whether local, state, federal or foreign.
11.4 Authority
and Execution.
Guarantor has the necessary corporate power and authority to execute, deliver
and perform its obligations under this Guaranty.
11.5 No
Representations by the Buyer Agent nor the Buyers.
Guarantor delivers this Guaranty based solely upon Guarantor’s own independent
investigation and based in no part upon any representation, statement, or
assurance by the Buyer Agent or the Buyers.
12. REIMBURSEMENT
AND SUBROGATION RIGHTS. Except
to
the extent that the Buyer Agent notifies Guarantor to the contrary in writing
from time to time:
12.1 General
Deferral of Reimbursement.
Guarantor waives any right to be reimbursed by Seller for any payment(s) made
by
Guarantor on account of the Guarantied Obligations, unless and until all
Guarantied Obligations have been paid in full and all periods within which
such
payments may be set aside or invalidated have expired. Guarantor acknowledges
that Guarantor has received adequate consideration for execution of this
Guaranty by virtue of the Buyers’ entering into the Repurchase Transactions
(which benefits Guarantor, as an owner or principal of Seller) and Guarantor
does not require or expect, and is not entitled to, any other right of
reimbursement against Seller as consideration for this Guaranty.
12.2 Deferral
of Subrogation and Contribution.
Guarantor agrees it shall have no right of subrogation against Seller, the
Buyers or the Buyer Agent and no right of subrogation against any Security
unless and until: (a) all amounts due under the Transaction Documents have
been paid in full and all other performance required under the Transaction
Documents has been rendered in full to the Buyer Agent and the Buyers; and
(b) all periods within which such payment and performance may be set aside
or invalidated have expired (such deferral of Guarantor’s subrogation and
contribution rights, the “Subrogation
Deferral”).
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12.3 Effect
of Invalidation.
To the
extent that a court of competent jurisdiction determines that Guarantor’s
Subrogation Deferral is void or voidable for any reason, Guarantor agrees,
notwithstanding any acts or omissions by the Buyers or the Buyer Agent, that
Guarantor’s rights of subrogation against Seller, the Buyer Agent and
Guarantor’s right of subrogation against any Security shall at all times be
junior and subordinate to the Buyer Agent’s rights against Seller and to the
Buyer Agent’s right, title, and interest in such Security.
13. CLAIMS
IN INSOLVENCY PROCEEDING. Guarantor
shall not file any claim in any Insolvency Proceeding affecting Seller unless
Guarantor simultaneously assigns and transfers such claim to the Buyer Agent,
without consideration, pursuant to documentation fully satisfactory to the
Buyer
Agent. Guarantor shall automatically be deemed to have assigned and transferred
such claim to the Buyer Agent whether or not Guarantor executes documentation
to
such effect. By executing this Guaranty, Guarantor hereby authorizes the Buyer
Agent (and grants the Buyer Agent a power of attorney coupled with an interest,
and hence irrevocable) to execute and file such assignment and transfer
documentation on Guarantor’s behalf. the Buyer Agent shall have the sole right
to vote, receive distributions on and exercise all other rights with respect
to
any such claim; provided,
however,
that if
and when the Guarantied Obligations have been paid in full, the Buyer Agent
shall release to Guarantor any further payments received on account of any
such
claim.
14. BUYER’S
DISGORGEMENT OF PAYMENTS. Upon
payment of all or any portion of the Guarantied Obligations, Guarantor’s
obligations under this Guaranty shall continue and remain in full force and
effect if all or any part of such payment is, pursuant to any Insolvency
Proceeding or otherwise, avoided or recovered directly or indirectly from the
Buyer Agent as a preference, fraudulent transfer, or otherwise irrespective
of
(a) any notice of revocation given by Guarantor prior to such avoidance or
recovery or (b) payment in full of the Repurchase Transactions. Guarantor’s
liability under this Guaranty shall continue until all periods have expired
within which the Buyer Agent could (on account of Insolvency Proceedings,
whether or not then pending, affecting Seller or any other person) be required
to return, repay, or disgorge any amount paid at any time on account of the
Guarantied Obligations.
15. FINANCIAL
INFORMATION. Within
ninety days after the end of each fiscal year of Guarantor and within forty-five
days after the end of each of the first three fiscal quarters, Guarantor shall
deliver to the Buyer Agent the financial statements of Guarantor (audited for
the annual financial statements and unaudited for the financial statements
of
the first three fiscal quarters), together with an officer’s certificate
addressed to the Buyer Agent certifying that, as of the end of such fiscal
quarter or fiscal year, as applicable, Guarantor was in compliance with each
of
the financial covenants contained in Section 5
of this
Guaranty and showing in reasonable detail the calculations demonstrating such
compliance.
16. CONSENT
TO JURISDICTION. Guarantor
agrees that any proceeding to enforce this Guaranty may be brought in any state
or federal court located in the State of New York. By executing this Guaranty,
Guarantor irrevocably accepts and submits to the nonexclusive jurisdiction
of
each of the aforesaid courts, generally and unconditionally with respect to
any
such proceeding.
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17. MERGER;
NO CONDITIONS; AMENDMENTS. This
Guaranty and documents referred to herein contain the entire agreement among
the
parties with respect to the matters set forth in this Guaranty. This Guaranty
supersedes all prior agreements among the parties with respect to the matters
set forth in this Guaranty. No course of prior dealings among the parties,
no
usage of trade, and no parol or extrinsic evidence of any nature shall be used
to supplement, modify, or vary any terms of this Guaranty. This Guaranty is
unconditional. There are no unsatisfied conditions to the full effectiveness
of
this Guaranty. No terms or provisions of this Guaranty may be changed, waived,
revoked, or amended without the written agreement of the parties hereto. If
any
provision of this Guaranty is determined to be unenforceable, then all other
provisions of this Guaranty shall remain fully effective.
18. GOVERNING
LAW; ENFORCEMENT. This
Guaranty shall be governed and construed in accordance with the internal laws
of
the State of New York (without regard to conflict of laws principles),
notwithstanding the location of any Security. Guarantor acknowledges that any
restrictions, limitations and prohibitions set forth in New York Real Property
Actions and Proceedings Law Sections 1301 and 1371 that would or might otherwise
limit or establish conditions to the Buyer Agent’s recovery of a judgment
against Guarantor if the Security were located in the State of New York shall
have absolutely no application to the Buyer Agent’s enforcement of this Guaranty
as against Guarantor, except to the extent that real property Security is
located within the State of New York. Guarantor acknowledges that this Guaranty
is an “instrument
for the payment of money only,”
within
the meaning of New York Civil Practice Law and Rules
Section 3213.
19. FURTHER
ASSURANCES. Guarantor
shall execute and deliver such further documents, and perform such further
acts,
as the Buyer Agent may reasonably request to achieve the intent of the parties
as expressed in this Guaranty, provided, in each case, that any such
documentation is consistent with this Guaranty and with the Transaction
Documents.
20. WAIVER
OF TRIAL BY JURY. GUARANTOR
WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING FROM OR RELATING TO
THIS GUARANTY OR THE TRANSACTION DOCUMENTS OR ANY OBLIGATION(S) OF GUARANTOR
HEREUNDER OR UNDER THE TRANSACTION DOCUMENTS.
21. MISCELLANEOUS.
21.1 Assignability.
the
Buyer Agent may assign this Guaranty (in whole or in part) together with any
one
or more of the Transaction Documents to any Person permitted under the
Repurchase Agreement, without in any way affecting Guarantor’s or Seller’s
liability. In connection with any such assignment, Guarantor shall deliver
such
documentation as the Buyer Agent shall reasonably request. This Guaranty shall
benefit the Buyer Agent and its successors and permitted assigns and shall
bind
Guarantor and its heirs, executors, administrators and successors. Guarantor
may
not assign this Guaranty, in whole or in part.
-13-
21.2 Notices.
All
notices, consents, approvals and requests required or permitted hereunder shall
be given in writing and shall be effective for all purposes if hand delivered
or
sent by (i) hand delivery, with proof of attempted delivery,
(ii) certified or registered United States mail, postage prepaid,
(iii) expedited prepaid delivery service, either commercial or United
States Postal Service, with proof of delivery or (iv) by facsimile (with
transmission confirmation), provided
that
such faxed notice must also be delivered by one of the means set forth in (i),
(ii) or (iii) above, addressed if to the Buyer Agent at Bank of America, N.A.,
Mail Code: NC1-027-19-01, Hearst Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, XX
00000, Attention: Xxxxxxxxxxx Xxxxx, Vice President, Portfolio Management,
Facsimile: (000) 000-0000, and if to Guarantor at c/o BlackRock Financial
Management, Inc., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Mr.
Xxxxxxx Xxxx, Facsimile No. (000) 000-0000, or at such other address and person
as shall be designated from time to time by any party hereto, as the case may
be, in a written notice to the other parties hereto in the manner provided
for
in this Section. A copy of all notices directed to Guarantor shall be delivered
concurrently to the following: Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxx., Xxx
Xxxx, XX 00000, Attn: Xxxxx Xxxxxxx (028354-0040), Facsimile No.: (000) 000
0000. A notice shall be deemed to have been given: (x) in the case of hand
delivery, registered or certified mail or expedited prepaid delivery service,
at
the time of delivery or (y) in the case of facsimile, upon receipt of
transmission confirmation, provided
that
such faxed notice was also delivered as required in this Section. A party
receiving a notice which does not comply with the technical requirements for
notice under this Section may elect to waive any deficiencies and treat the
notice as properly given.
21.3 Interpretation.
The
word “include” and its variants shall be interpreted in each case as if followed
by the words “without limitation.”
21.4 Counterparts.
This
Guaranty may be executed in counterparts, each of which so executed shall be
deemed to be an original, but all of such counterparts shall together constitute
but one and the same instrument.
22. BUSINESS
PURPOSES. Guarantor
acknowledges that this Guaranty, although executed in Guarantor’s individual
capacity, is executed and delivered for business and commercial purposes, and
not for personal, family, household, consumer or agricultural purposes.
Guarantor acknowledges that Guarantor is not entitled to, and does not require
the benefits of, any rights, protections, or disclosures that would or may
be
required if this Guaranty were given for personal, family, household, consumer,
or agricultural purposes. Guarantor acknowledges that none of Guarantor’s
obligation(s) under this Guaranty constitute(s) a “debt” within the meaning of
the United States Fair Debt Collection Practices Act, 15 U.S.C.
§ 1692a(5), and accordingly compliance with the requirements of such act is
not required if the Buyer Agent (directly or acting through its counsel) makes
any demand or commences any action to enforce this Guaranty.
23. NO
THIRD-PARTY BENEFICIARIES. This
Guaranty is executed and delivered for the benefit of the Buyer Agent, for
the
benefit of the Buyers, and its heirs, successors, and permitted assigns, and
is
not intended to benefit any third party.
24. CERTAIN
ACKNOWLEDGMENTS BY GUARANTOR. GUARANTOR
ACKNOWLEDGES THAT BEFORE EXECUTING THIS GUARANTY: (A) GUARANTOR HAS HAD THE
OPPORTUNITY TO REVIEW IT WITH AN ATTORNEY OF GUARANTOR’S CHOICE; (B) THE
BUYER AGENT HAS RECOMMENDED TO GUARANTOR THAT GUARANTOR OBTAIN SEPARATE COUNSEL,
INDEPENDENT OF SELLER’S COUNSEL, REGARDING THIS GUARANTY; AND (C) GUARANTOR
HAS CAREFULLY READ THIS GUARANTY AND UNDERSTOOD THE MEANING AND EFFECT OF ITS
TERMS, INCLUDING ALL WAIVERS AND ACKNOWLEDGMENTS CONTAINED IN THIS GUARANTY
AND
THE FULL EFFECT OF SUCH WAIVERS AND THE SCOPE OF GUARANTOR’S OBLIGATIONS UNDER
THIS GUARANTY.
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25. Effect
of amendment and restatement. As
of the
date hereof, the Existing Guaranty shall be amended, restated and superseded
in
its entirety. Each party to any Transaction Document hereby reaffirms its duties
and obligations under such Transaction Document or Transaction Documents to
which it is a party. Each reference to the Existing Guaranty in any Transaction
Document shall be deemed to be a reference to this Guaranty.
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IN
WITNESS WHEREOF, Guarantor has duly executed this Guaranty as of the date
indicated below.
Date:
August 7, 2008
GUARANTOR
Anthracite
Capital, Inc.
By: /s/
Xxxxxxx Xxxx
Name:
Xxxxxxx
Xxxx
Title:
President and
COO
Acknowledgment(s)
Bank
of
America, N.A., as buyer agent
By: /s/
Xxxxxxx X.
Xxxxx
Name:
Xxxxxxx X.
Xxxxx
Title:
Managing Director
Anthracite
Capital BOFA Funding LLC
By: Anthracite
Capital, Inc., its sole member
By: /s/
Xxxxxxx
Xxxx
Name:
Xxxxxxx
Xxxx
Title:
President and
COO
