AMENDED AND RESTATED INTERCREDITOR AGREEMENT
(Bear Xxxxxxx)
AMENDED AND RESTATED INTERCREDITOR AGREEMENT, dated as of February 17,
1999, between IMC MORTGAGE COMPANY, a Florida corporation (the "Company"),
GREENWICH STREET CAPITAL PARTNERS II, L.P., a Delaware limited partnership,
GREENWICH FUND, L.P., a Delaware limited partnership, GSCP OFFSHORE FUND, L.P.,
a Cayman Islands exempted limited partnership (each a "Facility Lender" and
collectively, the "Facility Lenders"), and BEAR XXXXXXX HOME EQUITY TRUST
("BSTrust"), BEAR, XXXXXXX INTERNATIONAL LIMITED ("BSIL"), and any of their
affiliates which are or become party to the Institutional Account Agreement (as
hereinafter defined). BSTrust, BSIL and any such affiliates are referred to
herein collectively as "Bear Xxxxxxx". Capitalized terms used in this Agreement
without definition have the meanings given to them in the Loan Agreement (as
hereinafter defined) as such terms are defined in the Loan Agreement on the date
hereof (or as amended by any amendment thereto approved by Bear Xxxxxxx).
RECITALS
A. The Company has entered into a Loan Agreement, dated as of October
12, 1998 the "Initial Loan Agreement"), between the Company, as borrower, and
the Facility Lenders, pursuant to which the Facility Lenders have agreed to
extend to the Company Commitments to loan, in the aggregate, $33,000,000 (the
"Initial Loans"), subject to the terms and conditions set forth in the Initial
Loan Agreement, which Initial Loans are evidenced by the Notes (as defined in
the Initial Loan Agreement) and entitled to the benefit of certain guarantees
and security provided under certain of the other Loan Documents (as defined in
the Initial Loan Agreement).
B. Pursuant to (a) a Master Repurchase Agreement, dated as of March 29,
1996, as amended from time to time, by and among BSTrust, the Company and
certain of the Company's Subsidiaries (the "Whole Loan Repurchase Agreement"),
and other related agreements with BSTrust (collectively with the Whole Loan
Repurchase Agreement, the "Whole Loan Repurchase Documents"); (b) the Master
Repurchase Agreement, dated as of May 1, 1997, as amended from time to time
(together with annexes, confirmations and transactions thereunder, collectively
the "Residuals Repurchase Agreement") between BSIL and Industry Mortgage
Company, L.P., the predecessor to the Company ("IMCLP"); and (c) the
Institutional Account Agreement,
dated October 23, 1996, as amended from to time, between and among IMCLP and
Bear Xxxxxxx (the "Institutional Account Agreement"; and together with the Whole
Loan Repurchase Agreement, the Whole Loan Repurchase Documents and the Residuals
Repurchase Agreement, collectively, the "Existing Agreements"), BSTrust and BSIL
have entered into transactions with the Company from time to time, pursuant to
which the Company has sold mortgage loans to BSTrust and securities to BSIL, in
each case subject to an obligation to repurchase such assets and for other
purposes provided therein; and the Company and certain of its Subsidiaries have
granted to BSTrust and BSIL a security interest in the Collateral (as
hereinafter defined) in order to secure the respective obligations of the
Company and the Subsidiaries under the Existing Agreements (the "Existing
Obligations").
C. The Company intends to enter into an Agreement and Plan of Merger
(the "Merger Agreement"), dated as of February __, 1999, by and among Greenwich
Street Capital Partners II, L.P., a Delaware limited partnership ("GSCP"), the
Company, IMC 1999 Acquisition Co., Inc., a Delaware corporation and a wholly
owned subsidiary of GSCP and its affiliates ("Acquisition"), pursuant to which
Acquisition would be merged with and into the Company and GSCP and its
affiliates would be issued common stock of the surviving corporation
representing approximately 93.5% of the outstanding common stock of the
surviving corporation (the "Merger").
D. In connection with the Merger Agreement, the Facility Lenders have
or intend to enter into (i) Amendment No. 1 to the Initial Loan Agreement
("Amendment No. 1"), providing for the Facility Lenders to extend to the Company
additional Commitments (the "Interim Commitments") to loan in the aggregate not
less than an additional $5,000,000 (the "Interim Loans") and (ii) an agreement
with Acquisition, dated as of February__, 1999, obligating the Facility Lenders,
upon consummation of the Merger, to enter into an amendment to the Initial Loan
Agreement, as amended (the "Amendment"), pursuant to which the Facility Lenders
will agree to extend to the Company Commitments to loan, in the aggregate, an
amount which, together with the Interim Commitments, will equal an additional
$40,000,000 (the "Additional Loans" and, together with the Initial Loans and the
Interim Loans, the "Loans"), subject to the terms and conditions set forth in
the Initial Loan Agreement, as amended by Amendment No. 1 and the Amendment (as
the same may be further modified, supplemented or restated from time to time,
the "Loan Agreement"), which Loans are evidenced by the Notes (as defined in the
Loan Agreement) and entitled to the benefit of certain guarantees and security
provided under certain of the other Loan Documents (as defined in the Loan
Agreement).
E. The Company, the Facility Lenders and Bear Xxxxxxx have previously
entered into an Intercreditor Agreement, dated as of October 12, 1998 (the
"Original Intercreditor Agreement"). In order to induce the Facility Lenders to
enter into the Amendment and GSCP to enter into the Merger Agreement, the
Facility Lenders, the Company, and Bear Xxxxxxx have agreed to enter into this
agreement amending and restating the Original Intercreditor Agreement (as so
amended and restated, the "Intercreditor Agreement").
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company, Bear Xxxxxxx and the
Facility Lenders agree to amend and restate the Original Intercreditor Agreement
to read in its entirety as follows:
Section 1. Standstill. (a) Each of the Facility Lenders and Bear
Xxxxxxx agrees, subject to the terms of this Agreement, that for the Standstill
Period, it shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its Subsidiaries, or initiate or
participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its Subsidiaries or any portion
of its assets;
(ii) seek to collect or enforce by litigation or otherwise, any
repurchase or payment obligations under the Existing Agreements or the Loan
Documents; provided that nothing in this Section 1 shall prohibit the
Facility Lenders from exercising their Exchange Option;
(iii) make any Margin Calls or other demands for payment in respect
of, or additional collateral to secure, the Existing Obligations; provided,
however, that this clause shall not adversely affect the right of Bear
Xxxxxxx to take any actions to preserve, protect or perfect its liens in
the Collateral;
(iv) declare a default or event of default under, or exercise or
enforce any right or remedy under, or accelerate the maturity of any
Existing Obligation or Loan under, any Existing Agreement or Loan Document;
or
(v) seek to attach, sequester or otherwise proceed against any of the
Collateral.
(b) The Standstill Period may be terminated by Bear Xxxxxxx or the Facility
Lenders by written notice to the Company and each other Creditor upon the
occurrence of any of the following:
(i) a failure by the Company under the Existing Agreements to make to
Bear Xxxxxxx any scheduled payment of interest, which failure continues
unremedied for two days, or any payment of principal due in respect of
payoffs or prepayments of mortgage loans comprising any portion of the
Collateral consisting of Purchased Loans or any payment of principal due
pursuant to Section 5 hereof;
(ii) any intentional fraud or misrepresentation by the Company;
(iii) immediately upon a failure of the Facility Lenders to make (x)
an Advance (as defined in the Initial Loan Agreement) under the Initial
Loan Agreement following a request of the Company thereunder, (y) an
Interim Loan under the Initial Loan Agreement as amended by Amendment No. 1
following a request by the Company thereunder or (z) immediately upon
consummation of the Merger, the Additional Loans under the Loan Agreement;
(iv) immediately in the event any Other Existing Lender takes any of
the actions described in Section 1(a) of its Other Intercreditor Agreement,
or, in the case of Bear Xxxxxxx, immediately in the event any Facility
Lender takes any of the actions described in Section 1(a) of this
Agreement, or, in the case of the Facility Lenders, immediately in the
event Bear Xxxxxxx takes any of the actions described in Section 1(a) of
this Agreement, in each case whether or not it shall have given notice of
termination of the Standstill Period;
(v) the condition contained in subclause (y) of clause (i) of the
definition of "Standstill Period" to the extension of the Standstill Period
beyond the date which is 150 days from and after the date hereof shall not
have been satisfied on or before such date;
(vi) a Change of Control or payment of the Take-Out Premium;
(vii) an event shall occur and be continuing for a period of ten
Business Days which permits any holder of indebtedness for borrowed money
of the Company or any Subsidiary outstanding (other than any Creditor) to
accelerate the maturity of such indebtedness or exercise remedies with
respect to property of the Company or any Subsidiary, without such
indebtedness being paid or the rights of such holder to take such action
being waived, stayed or subjected to a standstill or other agreement of
such holder to forbear from exercising remedies, reasonably satisfactory to
the Creditors;
(viii) the Company shall not have entered into the Merger Agreement
and Amendment No. 1 on or before February 19, 1999;
(ix) the independent servicer described in Section 5(g) of this
Agreement shall not have been retained on or before the date which is 30
days after the date of consummation of the Merger; and
(x) the Company shall, at any time on or after the date of
consummation of the Merger, repay all or any portion of the Loans.
(c) The Standstill Period shall terminate automatically without notice or
other action by any Creditor upon the occurrence of any of the following:
(i) the Company or any Subsidiary shall consent to the appoint ment of
or taking possession by a receiver, assignee, custodian, sequestrator,
trustee or liquidator (or other similar official) of itself or of a
substantial part of its property; or the Company or any Subsidiary shall
admit in writing (to any creditor, governmental authority or judicial court
or tribunal) its inability to pay its debts generally as they come due or
shall fail generally to pay its debts as they become due, or shall make a
general assignment for the benefit of its creditors; or the Company or any
Subsidiary shall file a voluntary petition in bankruptcy or a volun tary
petition or answer seeking liquidation, reorganization or other relief with
respect to itself or its debts under the Federal bankruptcy laws, as now or
hereafter constituted or any other applicable Federal or State bankruptcy,
insolvency or other similar law, or shall consent to the entry of an order
for relief in an involun tary case under any such law; or the Company or
any Subsidiary shall file an answer admitting the material allegations of a
petition filed against the Company in any such proceeding, or otherwise
seek relief under the provisions of any existing or future Federal or State
bankruptcy, insolvency or other similar law providing for the
reorganization or winding-up of corporations, or providing for an
arrangement, agreement, composition, extension or adjustment
with its creditors; or the Company or any Subsidiary shall take or publicly
announce its intention to take corporate action in furtherance of any of
the foregoing; or
(ii) an order, judgment or decree shall be entered in any
proceeding by any court of competent jurisdiction appointing, without the
consent of the Company, a receiver, trustee or liquidator of the Company
or any Subsidiary or of any substantial part of its property, or any
substantial part of the property of the Company or any Subsidiary shall be
sequestered, and any such order, judgment or decree of appointment or
sequestration shall remain in force undismissed, unstayed or unvacated for
a period of 30 days after the date of entry thereof; or
(iii) an involuntary petition against the Company or any
Subsidiary in a proceeding under the Federal bankruptcy laws or other
insolvency laws, as now or hereafter in effect, shall be filed and shall
not be withdrawn or dismissed within 30 days thereafter, or a decree or
order for relief in respect of the Company or any Subsidiary shall be
entered by a court of competent jurisdiction in an involuntary case under
the Federal bankruptcy laws, as now or hereafter constituted, or, under
the provisions of any law providing for reorganization or winding-up of
corporations which may apply to the Company, any court of com petent
jurisdiction shall assume jurisdiction, custody or control of the Company
or any Subsidiary or of any substantial part of its property and such
jurisdiction, custody or control shall remain in force unrelinquished,
unstayed or unterminated for a period of 30 days.
Section 2. Grant of Security Interest. (a) In order to secure full
and timely payment of the Obligations under the Loan Agreement, and to secure
the performance of all of the other obligations of the Company under the Loan
Documents, the Company and each Subsidiary hereby mortgages, pledges and assigns
and transfers to the Facility Lenders, and grants to the Facility Lenders, a
continuing perfected security interest in, and a lien in the Collateral. The
Facility Lenders agree to release their lien in respect of any whole loan
mortgage, which is sold by the Company to Bear Xxxxxxx for a purchase price not
less than the advance rate in respect of such mortgage.
(b) The Facility Lenders agree for the benefit of Bear Xxxxxxx that
during the continuance of the Standstill Period and thereafter until the earlier
of (i) the satisfaction of the Existing Obligations in full, (ii) the exercise
by Bear Xxxxxxx of any right to attach, sequester, foreclose or otherwise
exercise remedies with respect to the Collateral, and (iii) 180 days after the
expiration or earlier termination of the Standstill Period, the Facility Lenders
will not seek to attach, sequester, foreclose, levy on or otherwise exercise
remedies with respect to the
Collateral, provided that nothing herein shall restrict the Facility Lenders
from commencing suit on its Notes or for payment of its Loan or enforcement of
any other obligation owing to it under the Loan Documents.
Section 3. Acknowledgment and Priorities. (a) Bear Xxxxxxx hereby
acknowledges and consents to the entrance by the Company into the Loan Documents
and the granting of the lien in the Collateral granted pursuant to Section 2;
provided, however, notwithstanding anything to the contrary contained in the
Loan Agreement, the Notes or any of the Loan Documents, the parties hereto
acknowledge and agree that any security interest in or other rights with respect
to any Collateral granted to secure the Existing Obligations under the Existing
Agreements or otherwise has and shall have priority over any security interest
in such Collateral granted pursuant to this Agreement, the Initial Loan
Agreement, the Loan Agreement or the other Loan Documents irrespective of:
(i) the time, order or method of attachment or perfection of the
security interest created by this Agreement, the Initial Loan Agreement,
the Loan Agreement or any Loan Document;
(ii) the time or order of filing or recording of financing
statements or other documents filed or recorded to perfect security
interests in any Collateral;
(iii) anything contained in any filing or agreement to which the
Facility Lenders, the Company or the Collateral Agent under the Security
Documents now or hereafter may be a party, and
(iv) the rules for determining priority under the U.C.C. or other
laws governing the relative priorities of secured creditors.
(b) Bear Xxxxxxx hereby agrees that, following payment in full of
all the Existing Obligations hereunder, any Collateral, including any books and
records (including, without limitation, computer files, printouts and other
computer materials and records) relating to the Collateral, as well as all
proceeds and products of such Collateral, held by it shall be held for the
benefit of the Facility Lenders, provided that if such Collateral is then
subject to the prior lien of another creditor, Bear Xxxxxxx may hold it for
the benefit of such other creditor and the Facility Lenders as their interests
may appear. If Bear Xxxxxxx has elected not to hold such Collateral following
payment in full of the Existing Obligations, it shall promptly forward any
Collateral, including any books and records (including, without limitation,
computer files, printouts and other computer materials and records) relating to
the Collateral, as well as all proceeds and products of such Collateral, to the
Collateral Agent, provided that if such Collateral is then subject to the prior
lien of another creditor, Bear Xxxxxxx may forward such Collateral, proceeds and
products thereof to such other creditor or, in the event of a dispute, to such
party as a court of competent jurisdiction may direct.
(c) Nothing contained in this Agreement shall alter or impair Bear
Xxxxxxx' rights under the Existing Agreements from and after the termination of
the Standstill Period in accordance herewith or be interpreted to mean that Bear
Xxxxxxx has any obligation under the Existing Agreements or otherwise to return
any proceeds received on a sale or deemed sale of any Purchased MBS or Purchased
Loan to the Company or any Subsidiary, except as expressly set forth herein.
Section 4. Reserved Rights. (a) Notwithstanding anything in this
Agreement to the contrary, the Company and the Facility Lenders agree that this
Agreement shall in no manner impair any right of Bear Xxxxxxx under the Existing
Agreements to enforce any condition precedent to any obligation it may have
thereunder to engage in future Repurchase Transactions with the Company and its
Subsidiaries, nor shall this Agreement limit the right of Bear Xxxxxxx to make
Margin Calls in respect of the hedging transactions with respect to U.S.
treasury securities that the Company may have entered into with Bear Xxxxxxx
outside of the Existing Agreements. All rights and obligations of Bear Xxxxxxx
under the Existing Agreements to enter into Repurchase Transactions or not shall
not be affected by this Agreement.
(b) In addition and notwithstanding anything to the contrary
contained herein, this Agreement shall not (i) apply to any Advances made from
and after the date hereof, or any other obligation of the Company or any of its
Subsidiaries to Bear Xxxxxxx or any of its Affiliates incurred from and after
the date hereof or (ii) limit the rights of Bear Xxxxxxx or any Affiliate
thereof (x) to receive principal and/or interest at the applicable mortgage rate
on mortgage loans purchased by Bear Xxxxxxx or any such Affiliate from the
Company or any of its Subsidiaries or (y) to sell mortgage loans to the Company
or any of its Subsidiaries.
Section 5. Fees; Amortization. (a) From and after the date this
Agreement becomes effective, (i) within five days following the effective date
hereof, in
the case of any Available Cash Flow from Securitization Receivables received
prior to the effective date hereof for January and February 1999 and (ii) within
five days following receipt by Bear Xxxxxxx each month of Available Cash Flow
from Securitization Receivables, Bear Xxxxxxx shall apply the Applicable
Percentage of such Available Cash Flow from Securitization Receivables to
partial payment of the Existing Obligations under the Residuals Repurchase
Agreement and shall remit the balance of such Available Cash Flow from
Securitization Receivables to the Company, which may use such funds for general
corporate purposes.
(b) Upon consummation of the first to occur of (i) the Merger or (ii) a
Change in Control, the Company shall pay Bear Xxxxxxx a fee of $1,000,000 in the
aggregate payable in immediately available funds to such account at such bank as
Bear Xxxxxxx may direct.
(c) Upon consummation of the Merger, the Company shall pay $2,500,000
to Bear Xxxxxxx for application to payment of the Existing Obligations under the
Residuals Repurchase Agreement (other than the Price Differential accrued
thereon).
(d) The Company shall use its best efforts to sell or otherwise
liquidate each Purchased Loan which as of the date of consummation of the Merger
is a Delinquent Mortgage Loan and shall apply the proceeds thereof to payment of
the Existing Obligations under the Whole Loan Repurchase Documents (other than
to the Price Differential accrued thereon) promptly upon receipt thereof. In the
event more than two-thirds in aggregate principal amount of all such Delinquent
Mortgage Loans remain outstanding and have not been sold or liquidated by
September 30, 1999, the Company shall pay to Bear Xxxxxxx for application to the
Existing Obligations under the Whole Loan Repurchase Agreement in respect of a
portion of such Delinquent Mortgage Loans which, together with such Delinquent
Mortgage Loans that are no longer outstanding or have been sold or liquidated by
September 30, 1999, represent one-third of all such Delinquent Mortgage Loans an
amount equal to the Mortgage Loan Differential. In the event any such Delinquent
Mortgage Loan remains outstanding and is not sold or liquidated by December 31,
1999, the Company shall pay to Bear Xxxxxxx for application to payment of the
Existing Obligations under the Whole Loan Repurchase Documents an amount equal
to the Mortgage Loan Differential in respect of such Delinquent Mortgage Loan.
(e) Within 15 days following the end of the month in which the Merger
is
consummated and each month thereafter, the Company shall pay Bear Xxxxxxx for
application to the Existing Obligations under the Whole Loan Repurchase
Agreement (other than the Price Differential) an amount equal to the Mortgage
Loan Differential in respect of each Purchased Loan which during such calendar
month and after the date of consummation of the Merger first became, and as of
the last day of such calendar month remained, a Delinquent Mortgage Loan.
(f) The Company shall immediately pay Bear Xxxxxxx for application to
the Existing Obligations under the Residuals Repurchase Agreement an amount
equal to the Net Proceeds of Sale of Securitization Receivables sold or
otherwise disposed of by the Company or any Subsidiary. The Company shall not
sell or otherwise dispose of any Purchased MBS without Bear Xxxxxxx' consent,
such consent not to be unreasonably withheld or delayed. The parties agree that
it would be reasonable for Bear Xxxxxxx to withhold its consent to the sale of
any Purchased MBS if, in its sole discretion, Bear Xxxxxxx concludes that such
sale will impair its ability to be paid the Existing Obligations, the selling
price for the Purchased MBS should be higher or the Purchased MBS has not been
adequately marketed.
(g) The Company shall use best efforts to retain the services of a
rated and approved independent servicer with expertise in servicing delinquent
mortgage loans to assist it in servicing Delinquent Mortgage Loans.
(h) Bear Xxxxxxx or an affiliate thereof designated by Bear Xxxxxxx
shall have the right, subject to the provisions of the following sentence, to
act as co-lead or lead managing underwriter or placement agent with respect to
any and all mortgage-backed or asset-backed securities offerings involving loans
or other financial assets now owned or hereafter acquired or originated by the
Company or any Subsidiary thereof during the Standstill Period, provided that
the right to act as a lead managing underwriter or placement agent may, at the
Company's discretion, be shared equally, in the aggregate as to all such
offerings, among Bear Xxxxxxx (or such affiliate) and each other lender which is
then a provider of in excess of $200,000,000 of warehouse financing to the
Company and its Subsidiaries. The right of Bear Xxxxxxx (or such affiliate)
pursuant to this Section 5(h) is subject to the condition that Bear Xxxxxxx has
outstanding, at any time during the calender quarter in which such offering
occurs, at least $200,000,000 of the Existing Obligations under the Whole Loan
Repurchase Documents or other warehouse facilities and provides residual
financing on market terms on those offerings on which they act as a lead
underwriter or agent. The Company shall
compensate Bear Xxxxxxx for acting as underwriter or agent in accordance with
prevailing market terms at the time of any such offering.
(i) The Company shall, on or prior to the date three months after the
date hereof, pay Bear Xxxxxxx for application to the Existing Obligations under
the Whole Loan Repurchase Agreement an amount equal to the purchase price paid
in respect of any Mortgage Loans (other than Delinquent Mortgage Loans) which
Mortgage Loans were outstanding as of October 12, 1998. With respect to each
Mortgage Loan (other than Delinquent Mortgage Loans) purchased under the
Existing Loan Agreements on or after October 12, 1998, the Company shall pay
Bear Xxxxxxx for application to the Existing Obligations under the Whole Loan
Repurchase Agreement an amount equal to the purchase price therefor on or prior
to the date which is six months after such purchase was made. The Company may
sell such Mortgage Loans and apply the proceeds thereof to satisfaction of its
obligations pursuant to this Section 5(i), provided that, simultaneously
therewith, the Company repays the related Existing Obligations.
(j) In the event the Company shall fail to pay when due any amount due
to Bear Xxxxxxx under this Agreement, Bear Xxxxxxx may set off such amount
against Available Cash Flow from Securitization Receivables or payments on
Purchased Loans otherwise payable to the Company hereunder.
Section 6. Conditions Precedent. The effectiveness of this Agreement
shall be subject to the condition that each of the other Existing Lenders listed
on Schedule I (the "Other Existing Lenders") shall have entered into an Other
Intercreditor Agreement in the form annexed hereto. The Company shall furnish
complete and correct copies of each such Other Intercreditor Agreement within
one business day of its execution.
Section 7. Certain Definitions.
"Applicable Percentage" means (i) for January 1999, 46.67%, (ii) for
each calendar month commencing on or after February 1, 1999 to the date of
consummation of the Merger, 70%, (iii) for the first three calendar months
commencing on or after the date of the consummation of the Merger, 70% and (iv)
for the next three calendar months, 75% and (v) for the next six calendar
months, 80%. For purposes of applying the foregoing, if the date of consummation
of the Merger occurs on or before the fifteenth day of a month, the Merger shall
be deemed to have been consummated as of the first day of such month, and if the
date of consummation of the Merger occurs after the fifteenth day of a month,
then the Merger shall be deemed to have been consummated as of the first day of
the succeeding month.
"Available Cash Flow from Securitization Receivables" means the amount
of each distribution with respect to, and each prepayment of, any Purchased MBS.
"Change of Control" means the occurrence of any of the following events
(other than as a consequence of the issuance of the Preferred Stock to the
Facility Lenders upon exercise of the Exchange Option or the consummation of the
Merger):
(i) any "Person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act) is or becomes the "beneficial owner" (as defined in Rules
13d-3 and 13d-5 under the Exchange Act, except that a Person shall be
deemed to have "beneficial ownership" of all shares that any such Person
has the right to acquire within one year), directly or indirectly, of more
than 50% of the Voting Stock of the Company; or
(ii) the Company consummates any sale, lease, exchange or other
disposition of all or substantially all of the assets of the Company and
its Subsidiaries, taken as a whole, in any transaction or series of
transactions not in the ordinary course of business; or
(iii) the Company engages in a merger, consolidation or similar
business combination with any third party.
"Collateral" means (i) any rights of the Company in any Eligible Asset
transferred by the Company or its Subsidiaries to Bear Xxxxxxx in connection
with either a Repurchase Transaction or in response to a Margin Call; (ii) all
rights of the Company under the Existing Agreements, including the Company's
right to reacquire the Eligible Assets pursuant to the terms of the Existing
Agreements, the contractual right to receive payments, including the right to
payments of principal and interest and the right to enforce such payments,
arising from or under any of the Eligible Assets; (iii) the Company's
contractual right to service Purchased HELs (as defined in the Whole Loan
Repurchase Agreement); (iv) any other right, interest or property of the Company
or any Subsidiary now or hereafter securing the performance by the Company or
any Subsidiary of the Existing Obligations and (v) any and all proceeds,
payments, income, profits and products thereof, and all files and records
relating thereto.
"Common Stock" means the Company's common stock, par value $0.01
per share.
"Company" means IMC Mortgage Company, a Florida corporation, and any
successor by merger and any entity purchasing all or substantially all of the
assets of the Company.
"Creditor" means any of the Facility Lenders, Bear Xxxxxxx or any Other
Existing Lender.
"Delinquent Mortgage Loan" means any Mortgage Loan which, as of any
date of determination, is more than 90 days delinquent in payment of any
principal or interest due thereunder.
"Eligible Asset" means any Purchased HELs under the Whole Loan
Repurchase Agreement, Purchased MBS under the Residuals Repurchase Agreement, or
asset held on repurchase under the Existing Agreements and any assets
transferred by the Company or its Subsidiaries to Bear Xxxxxxx pursuant to a
Margin Call.
"Margin Call" means the right of Bear Xxxxxxx to give notice to require
the Company to transfer to Bear Xxxxxxx cash or additional collateral.
"Mortgage Loan" means any first-lien or second-lien residential
mortgage loan originated or serviced by the Company or its Subsidiaries.
"Mortgage Loan Differential" means, with respect to any Delinquent
Mortgage Loan, the excess of the purchase price paid by Bear Xxxxxxx in
connection with the Repurchase Transaction under which such Mortgage Loan was
transferred to Bear Xxxxxxx, reduced by any amount previously applied in
reduction of the amount outstanding under the applicable Existing Agreement
(other than in respect of Price Differential) in respect of such Delinquent
Mortgage Loan pursuant to Section 5(d) hereof or Section 5(e) hereof, over an
amount equal to 80% of the original principal amount of such Mortgage Loan.
"Net Proceeds of Sale of Securitization Receivables" means the
proceeds, net of any reasonable out-of-pocket costs of sale or disposition,
realized by the Company or any Subsidiary from any sale, lease or other
disposition of any Purchased MBS.
"Original BankBoston Forbearance Agreement" means the Forbearance and
Intercreditor Agreement, dated as of October 12, 1998, between the Company, the
Facility Lenders and BankBoston, N.A.
"Other Existing Lenders" has the meaning specified in Section 6.
"Other Intercreditor Agreements" means the separate intercreditor
agreements among the Company, an Other Existing Lender and the Facility Lenders.
"Price Differential" has the meaning given in the applicable Existing
Agreement.
"Purchased Loan" means any Mortgage Loan or Wet Mortgage Loan that is
transferred by the Company or its Subsidiaries to Bear Xxxxxxx in connection
with a Repurchase Transaction.
"Purchased MBS" means any security transferred to Bear Xxxxxxx by the
Company or any Subsidiary in connection with a Repurchase Transaction.
"Repurchase Transaction" means any transaction made by Bear Xxxxxxx
under the Existing Agreements.
"Seller's Guide" means the "IMC Mortgage Company Client Operations
Manual", together with the underwriting guidelines of the Company and its
Subsidiaries, a true and correct copy of which was previously provided to Bear
Xxxxxxx by the Company and its Subsidiaries.
"Standstill Period" means a period ending on the first to occur of (i)
the later of (x) 150 days from and after the date hereof and (y) one year from
and after the date of consummation of the Merger, if the Company shall have, on
or before the 150th day from and after the date hereof, consummated the Merger
and delivered (by facsimile transmission or otherwise in accordance with Section
16 hereof) to each Creditor confirmation thereof, (ii) termination of the
Standstill Period in accordance with Section 1(b) or 1(c) hereof or (iii)
termination of the Merger Agreement.
Section 8. Notice of Advances under the Loan Agreement, etc. (a) The
Company shall give prior written notice to Bear Xxxxxxx of each request for an
Additional Advance under Section 2.10 of the Initial Loan Agreement as amended
by Amendment No. 1 contemporaneously with making such request to the Facility
Lenders. The
Company shall give written notice to Bear Xxxxxxx immediately upon either the
funding of an Additional Advance (together with such evidence thereof as Bear
Xxxxxxx may reasonably request) or the refusal of Facility Lender to fund such
Additional Advance, as the case may be.
(b) The Company shall give each Creditor prompt written notice of any
event which upon notice or lapse of time or both would constitute an event of
default in respect of any of its outstanding Debt.
(c) The Company shall give Bear Xxxxxxx and the Facility Lenders prompt
written notice of any event that would permit termination of the Standstill
Period pursuant to clauses (iii), (iv), (vi), (vii), (viii), (ix) or (x) of
Section 1(b) hereof.
(d) The Company shall give Bear Xxxxxxx prompt written notice of the
entering into of the Merger Agreement and Amendment No. 1, the consummation of
the Merger, the entering into of the Amendment and the funding by the Facility
Lenders of the advances thereunder.
(e) Notwithstanding the provisions of the Existing Agreements, during
the Standstill Period, the Company shall pay the Price Differential accrued
under the Existing Agreements to Bear Xxxxxxx weekly on Friday of each week or,
if Friday is not a Business Day, on the next Business Day.
(f) The Company shall not repay any principal outstanding under the
Loan Agreement during the Standstill Period.
(g) During the Standstill Period (without limiting any obligations
under the Existing Agreements), the Company shall deliver to Bear Xxxxxxx at the
same time it delivers to the Facility Lenders, the Disclosure Letter, the
Three-Month Business Plan, any Updated Business Plan and all other financial
statements and reports required to be provided to the Facility Lenders pursuant
to Section 5.5 of the Loan Agreement.
Section 9. Acknowledgment of Obligations. The Company acknowledges that
its obligations under the Existing Agreements and Bear Xxxxxxx' rights under the
Existing Obligations remain in full force and effect, and that the Company has
no defenses, counterclaims or offsets to its obligations under the Existing
Agreements and that to the extent such rights include liens on the Collateral,
such liens are valid, perfected and enforceable. The Company hereby waives the
application of the automatic stay in any bankruptcy proceeding in respect of the
Existing Obligations and the obligations
under the Loan Documents and the Company and each Creditor consents to the
modification of the stay to permit the exercise by Bear Xxxxxxx or the Facility
Lenders of their rights in respect of the Collateral, provided that the
foregoing shall not be construed to modify the provisions of Sections 2(b) and 3
hereof. This document shall not constitute a waiver, amendment or modification
of the Existing Agreements, the Existing Obligations or the Loan Documents
except as expressly referred to herein and shall not be construed as a waiver or
consent to any future action on the part of the Company that would require a
waiver or consent of Bear Xxxxxxx or the Facility Lenders, respectively, except
to the extent expressly provided herein. The Company acknowledges that BSTrust
and BSIL are affiliates for purposes of the Institutional Account Agreement.
Section 10. Amendments, Etc. No amendment, modification, supplement,
termination, consent or waiver of this Agreement or any term or provision of
this Agreement shall be effective and binding unless in writing and signed by
Bear Xxxxxxx, the Other Existing Lenders and the Facility Lenders. Any such
waiver will be effective only in the specific instance and for the specific
purpose for which it is given.
Section 11. Severability. Any provision of this Agreement which is
illegal, invalid, prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such illegality, invalidity,
prohibition or unenforceability without invalidating or impairing the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
Section 12. Additional Payments. In the event that the Company or any
Affiliate proposes to sell or otherwise liquidate any Purchased MBS (or any
securitization receivables pledged or transferred to any Other Existing Lender
having the right to receive all or a portion of the proceeds of such sale or
liquidation) at a time when the amount of the Existing Obligations subject to
repurchase obligations in respect of such Purchased MBS (or the amount of the
Existing Obligations (as defined in an Other Intercreditor Agreement) owing to
such an Other Existing Lender secured by, or subject to repurchase obligations
in respect of, such other securitization receivables) remaining outstanding is
or would, after giving effect to any payment required to be made upon such sale
or liquidation, be less than 40% of such Existing Obligations as of the date
this Agreement became effective and which is in addition to the payments
contemplated under the provisions of Section 5 of this Agreement or Section 5 of
any Other Intercreditor Agreement or the Original Forbearance and Intercreditor
Agreement, each as may be amended from time to time, the Company shall not
effect any such sale or
liquidation unless it shall take such steps as may be necessary to cause
payments to be made in respect of the Existing Obligations and the Existing
Obligations (as defined in the Other Intercreditor Agreements) owing to such
Other Existing Lenders on a pro rata basis calculated based on the respective
outstanding principal balance of such Existing Obligations owing to each
Existing Lender and each such Other Existing Lender.
Section 13. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR EQUITABLE
ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR ANY
TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP ESTABLISHED HEREUNDER.
Section 14. GOVERNING LAW; VENUE AND JURISDICTION. THE VALIDITY OF THIS
AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT HEREOF AND THE
RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH OF THE PARTIES HERETO
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES THAT ALL ACTIONS OR
PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE TRIED AND LITIGATED
IN, FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER JURISDICTION, STATE
COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK UNLESS SUCH ACTIONS
OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT TO OBTAIN SUBJECT
MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF THE PARTIES WAIVES,
TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO
ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE THE DOCTRINE OF FORUM NON
CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING BROUGHT IN ACCORDANCE WITH
THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF PROCESS, SUFFICIENT FOR PERSONAL
JURISDICTION IN ANY ACTION AGAINST SUCH PARTY, MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS ADDRESS INDICATED IN SECTION
17.
Section 15. Expenses. In addition to the foregoing, the Company will
also reimburse Bear Xxxxxxx and the Facility Lenders promptly for their
reasonable out-of-pocket costs and expenses incurred by such Persons or their
respective employees,
agents or advisors in connection with the performance of their respective
obligations and duties hereunder and to the extent the Existing Agreements so
provide, under the Existing Agreements, and for any reasonable fees and expenses
of legal or other professional advisors to Bear Xxxxxxx and the Facility Lenders
engaged in connection with the preparation and negotiation of this Agreement and
review and negotiation of all related documents, including the Merger Agreement,
Loan Agreement, and monitoring performance of all related documents. If such
fees are not paid by the Company within 30 days of submission, Bear Xxxxxxx may
pay such fees from Available Cash Flow from Securitization Receivables and
payments on Purchased Loans.
Section 16. Agreement May Constitute Financing Statement. The Company
and Bear Xxxxxxx consents to the filing of this Agreement or a photocopy thereof
as a financing statement under the UCC as in effect in any jurisdiction in which
the Facility Lenders may determine such filing to be necessary or desirable.
Section 17. Notices. All notices, requests and other communications to
any party hereunder shall be in writing and shall be given to such party by
facsimile transmission or by hand delivery at the following address or facsimile
number, or such other address or facsimile number as such party may hereafter
specify for the purpose by notice to the other party and each other creditor,
(a) if to the Facility Lenders, Greenwich Street Capital Partners II, L.P., c/o
Greenwich Street Capital Partners, Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attn.: Xxxxxx Xxxxx; Tel: (212) 000- 0000, Fax: (000) 000-0000; with
a copy to Debevoise & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
attention: Xxxxxx Xxxxxx, tel: (000) 000-0000, fax: (000) 000-0000; (b) if to
the Company, IMC Mortgage Company, 0000 X. Xxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000,
Attn.: President, Tel: 000-000-0000, Fax: (000) 000-0000; with a copy to
Xxxxxxxx X. Xxxxxx, 000X Xxxxxxxxx Xxx, Xxxxxxxxxxxx, Xxxxxxx 0000; and (c) and
if to Bear, Xxxxxxx: Bear Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attn: Xxxxxx X. Cedar, Tel.: (000) 000-0000, Fax: (000) 000-0000 and
Xxxx Xxxxxxxx, Tel.: (000) 000-0000, Fax: (000) 000-0000, with a copy to;
Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.
Xxxxx X. Xxxxxxx, Esq., Tel.: (000) 000-0000, Fax: (000) 000-0000; and if to any
of the Other Existing Lenders, to such person and at the address and facsimile
number provided in Schedule II hereof. Each such notice, request or other
communication shall be effective when sent by facsimile transmission to the
facsimile number or when delivered by hand to the address specified in this
Section 17 or Schedule II hereto, provided that a facsimile transmission shall
be deemed to have been sent only so long as the transmitting machine
has provided an electronic confirmation of such transmission.
Section 18. Binding Effect; Third Party Beneficiaries. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
successors and permitted assigns, including any successor of the Company by
merger or any entity which purchases all or substantially all of the assets of
the Company, and to each of the other Creditors, each of which is an intended
third-party beneficiary hereof. Neither the Facility Lenders nor Bear Xxxxxxx
may sell, assign, participate or otherwise transfer or dispose of all or any
portion of the Loan or the Existing Obligations to any Person unless such Person
shall have assumed and agreed to be bound by the terms hereof by written
instrument in form reasonably satisfactory to the Company and each other
Creditor.
Section 19. Interpretation; Transaction Intended as Purchases and
Sales. The parties specifically acknowledge and recognize that certain language
and use of words in this Agreement may erroneously suggest that transactions
under the Existing Agreements are intended by them to be characterized as loans
or other secured financing arrangements and not as absolute purchases and sales
of mortgage loans and hereby reaffirm that all such transactions are intended to
constitute absolute purchases and sales.
Section 20. Counterparts; Section Headings. This Agreement may be
executed in any number of counterparts, each of which is an original, but all of
which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and the
section headings in this Agreement are for purposes of reference only and shall
not limit or define the meaning hereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
IMC MORTGAGE COMPANY
By /s/
--------------------------------
Name:
Title:
BEAR XXXXXXX HOME EQUITY TRUST
By /s/
--------------------------------
Name:
Title:
BEAR XXXXXXX INTERNATIONAL
LIMITED
By /s/
--------------------------------
Name:
Title:
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
By: GREENWICH STREET
INVESTMENTS II, L.L.C.,
their General Partner
By: /s/
-----------------------------------
Name:
Title:
This Intercreditor Agreement is hereby acknowledged and agreed to by:
IMC CORPORATION OF AMERICA
IMC CREDIT CARD, INC.
IMC MORTGAGE COMPANY CANADA, LTD.
AMERICAN HOME EQUITY CORPORATION
IMC INVESTMENT CORPORATION
IMC INVESTMENT LIMITED PARTNERSHIP
ACG FINANCIAL SERVICES (IMC), INC.
AMERICAN MORTGAGE REDUCTION, INC.
CENTRAL MONEY MORTGAGE CO. (IMC), INC.
COREWEST BANC
EQUITY MORTGAGE CO. (IMC), INC.
IMCC INTERNATIONAL, INC.
MORTGAGE AMERICA (IMC), INC.
NATIONAL LENDING CENTER, INC.
NATIONAL LENDING CENTER TILT, INC.
NATIONAL LENDING GROUP, INC.
RESIDENTIAL MORTGAGE CORPORATION (IMC), INC.
By /s/
--------------------------------
Name:
Title:
XXXXX XXXXXX REAL ESTATE SECURITIES INC.
By /s/
--------------------------------
Name:
Title:
GERMAN AMERICAN CAPITAL CORPORATION
By /s/
--------------------------------
Name:
Title:
By /s/
--------------------------------
Name:
Title:
ASPEN FUNDING CORP.
By /s/
--------------------------------
Name:
Title:
Schedule I
to the
Bear Xxxxxxx Intercreditor Agreement
Other Existing Lenders
Loan and Security Agreement, dated March 17, 1998, by and among IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Central Money Mortgage Co. (IMC), Inc.,
Corewest Banc, Equity Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc, and
Residential Mortgage Corporation (IMC), Inc., as borrowers, and German American
Capital Corporation, as lender.
Loan and Security Agreement, dated March 17, 1998, by and among IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Central Money Mortgage Co. (IMC), Inc.,
Corewest Banc, Equity Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc, and
Residential Mortgage Corporation (IMC), Inc., as borrowers, and Aspen Funding
Corp.
Loan and Security Agreement, dated as of February 28, 1997, between IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Industry Mortgage Company, L.P., Corewest
Banc, IMC Investment Corp., and IMC Investment Limited Partnership, as
borrowers, and Xxxxx Xxxxxx Real Estate Securities, Inc., as lender.
(i) Bridge Loan and Security Agreement, dated as of October 10, 1997, as amended
from time to time, by and among the Company, certain of its Subsidiaries and
BankBoston N.A., to which the Facility Lenders have succeeded by assignment, and
(ii) a Loan and Security Agreement, dated December 31, 1996, as amended from
time to time, by and among the Company, certain of its Subsidiaries and
BankBoston N.A., to which the Facility Lenders have succeeded by assignment.
Schedule II
to the
Bear Xxxxxxx Intercreditor Agreement
Notice Address for Other Existing Lenders
Xxxxx Xxxxxx
if to Xxxxx Xxxxxx, to: PaineWebber Real Estate Securities, Inc., 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxxx Xxxxxxxxxxxx, Tel: (212)
000- 0000, Fax: (000) 000-0000; with a copy to Cadwalader, Xxxxxxxxxx & Xxxx,
000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxxxx X. Xxxxxx, Esq., Tel:
(212) 000- 0000; Fax: (000) 000-0000
Deutsche Lenders
if to Aspen Funding, to: Aspen Funding Corp. c/o Amacar Group, 0000X Xxxxxxxx
Xxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attn.: Xxxxxxx Xxxxxxx, tel.: (704)
000-0000, fax: (000) 000-0000, with a copy to: Deutsche Bank A.G., as agent, 00
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxx Xxxxxxx, Tel.: (212)
000-0000, Fax: (000) 000-0000 and Xxxxxxx Xxxxx, Tel.: (000) 000-0000, Fax:
(000) 000-0000; and with a copy to Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx
Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxx Xxxxxxx, Esq., Tel: (000) 000-0000,
Fax: (000) 000-0000
if to German American Corporation, to: German American Capital Corporation, 00
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxx Xxxxxxxxxxx, Tel.:
(212) 000- 0000, Fax: (000) 000-0000, with a copy to: Deutsche Bank A.G., as
agent, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxx Xxxxxxx, Tel.:
(000) 000-0000, Fax: (000) 000-0000, and Xxxxxxx Xxxxx, Tel.: (000) 000-0000,
Fax: (000) 000-0000; and in either case described in clause (i) or (ii) above;
with a copy to Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attn.: Xxxxx Xxxxxxx, Esq., Tel: (000) 000-0000, Fax: (000) 000-0000
BankBoston Facility
Schedule II
to the
Bear Xxxxxxx Intercreditor Agreement
if to the Facility Lenders, as successors in interest to BankBoston, to: the
address provided for notice to the Facility Lenders pursuant to Section 17 of
the foregoing Agreement
