GUARANTY
This
GUARANTY
is made
and entered into by Anthracite
Capital, Inc.,
a
Maryland corporation whose address is 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 (“Guarantor”),
for
the benefit of Deutsche
Bank AG, Cayman Islands Branch,
whose
address is 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“Buyer”).
This
Guaranty is made with reference to the following facts (with some capitalized
terms being defined below):
A. Buyer
is
considering entering into one or more repurchase agreement transactions (the
“Repurchase
Transactions”)
in the
aggregate amount of Two Hundred Million Dollars ($200,000,000.00) with
Anthracite Funding, LLC, a Delaware limited liability company whose address
is
00 Xxxx 00xx
Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000 (“Seller”).
B. In
connection with the Repurchase Transactions, Seller and Buyer are entering
into
the following documents (collectively, together with this Guaranty and any
other
documents evidencing, securing, or otherwise relating to the Repurchase
Transactions or this Guaranty, the “Repurchase
Documents,”
which
term is more fully defined below):
1. that
certain Master Repurchase Agreement between Seller and Buyer dated December
23,
2004, together with all annexes thereto including but not limited to the English
Loan Supplement between Seller and Buyer dated December 23, 2004 (as amended,
modified and in effect from time to time, the “Repurchase
Agreement”);
and
2. that
certain Amended and Restated Custodial Agreement among Buyer, Seller and LaSalle
Bank National Association dated as of December 23, 2004 together with the
English Custodian Agreement between LaSalle Bank National Association and Buyer
dated as of December 23, 2004 and any other amendments or
supplements.
C. Buyer
has
examined, among other things, both Seller’s and Guarantor’s creditworthiness and
ability to pay and perform Seller’s obligations under the Repurchase
Documents.
D. Buyer
has
requested, as a condition of entering into the Repurchase Agreement, that the
obligations of Seller be guarantied by Guarantor.
E. Guarantor
is the direct owner of 100% of the membership interests of Seller.
F. Guarantor
expects to benefit if Buyer enters into the Repurchase Agreement with Seller,
and desires that Buyer enter into the Repurchase Agreement with
Seller.
G. Buyer
would not enter into, and would not be obligated to enter into, the Repurchase
Agreement with Seller unless Guarantor executed this Guaranty. This Guaranty
is
therefore delivered to Buyer to induce Buyer to enter into the Repurchase
Agreement.
NOW,
THEREFORE,
in
exchange for good, adequate, and valuable consideration, the receipt of which
Guarantor acknowledges, and to induce Buyer to enter into the Repurchase
Agreement and accept the Repurchase 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.
(a) “Affiliate”
means,
when used with respect to any specified Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, such
Person. “Control” means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise
and
“controlling” and “controlled” shall have meanings correlative
thereto.
(b) “Business
Day”
means
a
day other than (i) a Saturday or Sunday, or (ii) a day in which the New York
Stock Exchange or banks in the State of New York or Illinois are authorized
or
obligated by law or executive order to be closed.
(c) “Buyer
Entity”
means,
as designated by Buyer from time to time, Buyer or Buyer’s assignee, designee,
nominee, servicer, or wholly owned Subsidiary, provided that Buyer’s assignee is
a Person permitted under the Repurchase Agreement.
(d) “Capital
Lease”,
as
applied to any Person, means any lease of any property (whether real, personal
or mixed) by that Person or entity as lessee that, in conformity with GAAP,
is
accounted for as a capital lease on the balance sheet of that Person or
entity.
(e) “Co-Guarantor”
means,
as to each Guarantor, any person (other than Seller and such Guarantor) that
guaranties or is otherwise liable for the Repurchase Transactions, or any
portion of the Repurchase Transactions, whether by executing this Guaranty
or by
executing any other guaranty of the Repurchase Transactions, or by otherwise
assuming personal liability for the Guarantied Obligations or any part thereof.
If Guarantor is the only guarantor of the Repurchase Transactions, then all
references to “Co-Guarantor(s)” shall be disregarded.
(f) “Consolidated
Net Income”
for
any
period means the amount of consolidated net income (or loss) of the Guarantor
and its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP.
(g) “Debt
Service Coverage”
means
the ratio of Funds From Operations plus Interest Expense on recourse
Indebtedness outstanding to Interest Expense on recourse Indebtedness
outstanding.
(h) “Funds
From Operations”
for
any
period means the Consolidated Net Income of the Guarantor and its Subsidiaries
for such period without giving effect to depreciation and amortization uniquely
significant to real estate, gains or losses which are classified as
“extraordinary” in accordance with GAAP, capital gains or losses on sales of
real estate, capital gains or losses with respect to the disposition of
investments in marketable securities and any provision/benefit for income taxes
for such period, plus the allocable portion, based on the Guarantor’s ownership
interest, of funds from operations of unconsolidated joint ventures, all
determined on a consistent basis.
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(i) “GAAP”
means
with respect to the financial statements or other financial information of
any
Person, generally accepted accounting principles in the United States which
are
in effect from time to time.
(j) “Guarantied
Obligations”
means
Seller’s obligations: (a) to fully and promptly pay all sums owed under the
Repurchase Documents at the times and according to the terms required by the
Repurchase Documents, without regard to any modification, suspension, or
limitation of such terms not agreed to by Buyer, 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 Buyer’s consent or agreement); (b) to pay all
other sums expended by Buyer or Buyer’s designee or nominee acting on Buyer’s
behalf in exercising Buyer’s rights and remedies under the Repurchase Documents,
including Buyer’s Legal Costs relating to the Repurchase Transactions and
enforcement of remedies pursuant to the Repurchase Documents; and (c) to perform
all other obligations contained in the Repurchase Documents, whether monetary
or
nonmonetary, when and as required by the Repurchase Documents, including all
obligations of Seller relating to the Repurchase Transactions and the Security
under the Repurchase Documents.
(k) “Guarantor
Litigation”
means
any litigation, arbitration, investigation, or administrative proceeding of
or
before any court, arbitrator, or governmental authority, bureau or agency that
relates to or affects this Guaranty or any asset(s) or property(ies) of
Guarantor, including any litigation between or among Guarantor and any
Co-Guarantor(s).
(l) “Indebtedness”
means,
for any Person: (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 of 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 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 Leases of such Person;
and
(f) indebtedness of others guaranteed by such Person.
(m) “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.
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(n) “Interest
Expense”
means
for any period, total interest expense, both expensed and capitalized, of
Guarantor and its Subsidiaries for such period with respect to all outstanding
Indebtedness of Guarantor and its Subsidiaries (including, without limitation,
all commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers’ acceptance financing and net costs under interest
rate protection agreements), determined on a consolidated basis in accordance
with GAAP, net of interest income of Guarantor and its Subsidiaries for such
period (determined on a consolidated basis in accordance with
GAAP).
(o) “Legal
Costs”
means
all reasonable costs and expenses actually incurred by Buyer in any Proceeding
or in obtaining legal advice and assistance in connection with any Proceeding,
any Guarantor Litigation, or any default by Seller under the Repurchase
Documents or by Guarantor under this Guaranty (including any breach of a
representation or warranty contained in this Guaranty), including reasonable
attorneys’ fees, disbursements, and other charges actually incurred by Buyer’s
attorneys, court costs and expenses, and charges for the services of paralegals,
law clerks, and all other personnel whose services are charged to Buyer in
connection with Buyer’s receipt of legal services.
(p) “Lien”
means
any mortgage, lien, encumbrance, charge or other security interest, whether
arising under contract, by operation of law, judicial process or
otherwise.
(q) “Net
Worth”
means
the amount which would be included under stockholders’ equity on a consolidated
balance sheet of Guarantor and its Subsidiaries determined on a consolidated
basis in accordance with GAAP.
(r) “Person”
means
an individual, partnership, corporation, joint stock company, trust or
unincorporated organization or a governmental agency or political subdivision
thereof.
(s) “Proceeding”
means
any action, suit, arbitration, or other proceeding arising out of, or relating
to the interpretation or enforcement of, this Guaranty or the Repurchase
Documents, including (a) an Insolvency Proceeding; (b) any proceeding in which
Buyer endeavors to realize upon any Security or to enforce any Repurchase
Document(s) (including this Guaranty) against Seller or Guarantor; and (c)
any
proceeding commenced by Seller, Guarantor, or any Co-Guarantor against
Buyer.
(t) “Repurchase
Documents”
means:
(a) the Repurchase Documents, as defined in the recitals; (b) any other
documents or instruments relating to any such documents executed by Seller,
Guarantor, or any Co-Guarantor; and (c) any modifications, extensions, renewals,
restatements, or replacements of any of the foregoing, whether or not consented
to by Guarantor.
4
(u) “Security”
means
any security or collateral held by or for Buyer 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. “Security” shall include all assets and property of any
kind whatsoever pledged or mortgaged to Buyer pursuant to the Security
Documents.
(v) “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.
(w) “State”
means
the State of New York.
(x) “Stock”
means
all shares, options, warrants, general or limited partnership interests,
membership interests or other ownership interests (regardless of how designated)
of or in a corporation, partnership, limited liability company, trust or other
entity, whether voting or nonvoting, including common stock, preferred stock,
or
any other “equity security” (as such term is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended).
(y) “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.
(z) “Tangible
Net Worth”
means,
as of a particular date,
|
(i)
|
all
amounts that would be included under capital on a balance sheet of
the
Seller at such date, determined in accordance with GAAP,
less
|
|
(ii)
|
the
sum of (A) amounts owing to the Seller from Affiliates and (B) intangible
assets.
|
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 Repurchase 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 (including Legal Costs) payable by Seller under the Repurchase Documents,
including any of the foregoing that would have accrued under the Repurchase
Documents but for any Insolvency Proceeding.
4. Changes
in Repurchase Documents.
Without
notice to, or consent by, Guarantor, and in Buyer’s sole and absolute discretion
and without prejudice to Buyer or in any way limiting or reducing Guarantor’s
liability under this Guaranty, but subject to the terms of the Repurchase
Agreement, Buyer may: (a) grant extensions of time, renewals or other
indulgences or modifications to Seller, any Co-Guarantor or any other party
under any of the Repurchase Document(s), (b) change, amend, or modify any
Repurchase 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 Repurchase 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 Buyer may determine, (i) credit payments in such manner and order
of
priority as Buyer may determine in its discretion provided such credits shall
be
consistent with the requirements of the Repurchase Agreement, and (j) otherwise
deal with Seller and any Co-Guarantor and any other party related to the
Repurchase Transactions or any Security as Buyer 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 Buyer alters
any obligations under the Repurchase Documents in any respect or Buyer’s or
Guarantor’s remedies or rights against Seller are in any way impaired or
suspended without Guarantor’s consent. If Buyer performs any of the actions
described in this paragraph, then Guarantor’s liability shall continue in full
force and effect even if Buyer’s actions impair, diminish or eliminate
Guarantor’s subrogation, contribution, or reimbursement rights (if any) against
Seller or any Co-Guarantor, or otherwise adversely affect Guarantor or expand
Guarantor’s liability hereunder.
5. Certain
Financial Covenants.
Guarantor shall not permit with respect to itself any of the following to be
breached, as determined quarterly on a consolidated basis in conformity with
GAAP as set forth in the financial statements of the Guarantor delivered
pursuant to Section 15 hereof:
(a) Minimum
Tangible Net Worth.
Tangible Net Worth to be less than $250 million;
(b) Minimum
Debt Service Coverage.
Debt
Service Coverage to be less than 1.75 to 1 in the aggregate;
(c) Debt
to Book Equity.
Recourse Indebtedness to Net Worth to exceed 3.0 to 1; and
6
(d) Minimum
Cash or Marketable Securities.
Cash or
marketable securities, approved by Buyer, based on Guarantor’s ratio of recourse
Indebtedness to Net Worth, to be less than the following:
|
Debt
to Book Equity Ratio
|
Minimum
Cash or Marketable Securities
|
|
|
Above
2:1
|
$10
million
|
|
|
Between
1:1 and 2:1
|
$5
million
|
|
|
Below
1:1
|
$3
million
|
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 collectibility. Guarantor’s liability under this Guaranty is not conditioned
or contingent upon the genuineness, validity, regularity or enforceability
of
any of the Repurchase 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 Repurchase Documents or later ceases to be liable under any
Repurchase 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 Buyer to proceed first against Seller, any Co-Guarantor(s)
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 Buyer disburses the Repurchase
Transactions to Seller or otherwise, or any waiver of the terms of any
Repurchase Document by Buyer or other failure of Buyer to require full
compliance with the Repurchase Documents. Guarantor’s liability under this
Guaranty shall continue until all sums due under the Repurchase Documents have
been paid in full and all other performance required under the Repurchase
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) Buyer’s
failure to perfect a security interest in any Security, (c) any disability
or
other defense(s) of Seller or any Co-Guarantor(s), (d) any acts or omissions
of
Buyer; or (e) any breach by Seller of any representation or warranty contained
in any Repurchase Document.
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7. Waivers
of Rights and Defenses.
Guarantor waives any right to require Buyer to (a) proceed against Seller or
any
Co-Guarantor(s), (b) proceed against or exhaust any Security, or (c) pursue
any
other right or remedy for Guarantor’s benefit. Guarantor agrees that Buyer may
proceed against Guarantor with respect to the Guarantied Obligations without
taking any actions against Seller or any Co-Guarantor(s) and without proceeding
against or exhausting any Security. Guarantor agrees that Buyer 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 or any Co-Guarantor(s) without impairing Buyer’s rights and
remedies in enforcing this Guaranty, under which Guarantor’s liabilities shall
remain independent and unconditional. Guarantor agrees and acknowledges that
Buyer’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
Buyer’s acts or omissions. If Buyer’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 Buyer’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 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 Buyer’s right to recover a deficiency judgment after any foreclosure sale,
or (iii) require Buyer to exhaust its Security before Buyer may obtain 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 Repurchase
Document, or any other provision of a Repurchase Document limiting Buyer’s
recourse to specific Security or limiting Buyer’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. To the extent that
Buyer collects or receives any sums or payments from Seller or any Co-Guarantor,
Buyer shall apply such amounts first to that portion of Seller’s obligations to
Buyer (if any) that is covered by this Guaranty.
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 Buyer’s part in exercising any power, right or privilege under this
Guaranty shall impair or waive any such power, right or privilege.
8
9. No
Duty to Prove Loss.
To the
extent that Guarantor at any time incurs any liability under this Guaranty,
Guarantor shall immediately pay Buyer (to be applied on account of the
Guarantied Obligations) the amount provided for in this Guaranty, without any
requirement that Buyer demonstrate that Buyer has currently suffered any loss
or
that Buyer has otherwise exercised (to any degree) or exhausted any of Buyer’s
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 Repurchase Documents, the transaction
contemplated by the Repurchase Documents, and all underlying facts relating
to
such transaction. Guarantor represents and warrants that Guarantor fully
understands: (a) the remedies Buyer may pursue against Seller and/or Guarantor
in the event of a default under the Repurchase Documents, (b) the value (if
any)
and character of any Security, and (c) Seller’s financial condition and ability
to perform under the Repurchase Documents. Guarantor agrees to keep itself
fully
informed regarding all aspects of the foregoing and the performance of Seller’s
obligations to Buyer. Buyer has no 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 Repurchase
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 Repurchase
Documents, may be event(s) of default under the Repurchase
Documents.
11. Representations
and Warranties.
Guarantor acknowledges, represents, and warrants as follows, and acknowledges
that Buyer is relying upon the following acknowledgments, representations,
and
warranties by Guarantor in making the Repurchase Transactions:
(a) Repurchase
Documents.
All
Repurchase Documents to which Guarantor is a party have been duly authorized,
executed, and delivered by Guarantor, and are fully valid, binding, and
enforceable against Guarantor, in accordance with their terms, subject to
bankruptcy, insolvency, and other limitations on creditors’ rights generally and
to equitable principles. Seller is validly formed, in good standing, and
obligated under the Repurchase Documents in accordance with their
terms.
(b) 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.
(c) 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.
9
(d) Authority
and Execution.
Guarantor has full power, authority, and legal right to execute, deliver and
perform its obligations under this Guaranty. Guarantor has taken all necessary
corporate and legal action to authorize this Guaranty, which has been duly
executed and delivered and is a legal, valid, and binding obligation of
Guarantor, enforceable in accordance with its terms, subject to bankruptcy,
insolvency and other limitations on creditors’ rights generally and to equitable
principles.
(e) No
Representations by Buyer.
Guarantor delivers this Guaranty based solely upon Guarantor’s own independent
investigation and based in no part upon any representation, statement, or
assurance by Buyer.
(f) No
Misstatements.
No
information, exhibit, report or certificate furnished by Seller or Guarantor
to
Buyer in connection with the Repurchase Transactions or any Repurchase Document
contains any material misstatement of fact or has omitted to state a material
fact or any fact necessary to make the statements contained therein not
materially misleading.
12. Reimbursement
and Subrogation Rights.
Except
to the extent that Buyer notifies Guarantor to the contrary in writing from
time
to time:
(a) 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 Buyer’s 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.
(b) Deferral
of Subrogation and Contribution.
Guarantor agrees it shall have no right of subrogation against Seller or Buyer,
no right of subrogation against any Security, and no right of contribution
against any Co-Guarantor unless and until in Buyer’s reasonable determination:
(a) such right of subrogation does not violate (or otherwise produce any result
adverse to Buyer under) any applicable law, including any bankruptcy or
insolvency law; (b) all amounts due under the Repurchase Documents have been
paid in full and all other performance required under the Repurchase Documents
has been rendered in full to Buyer; (c) all periods within which such payment
and performance may be set aside or invalidated have expired; and (d) Buyer
has
released, transferred or disposed of all of its right, title and interest in
all
Security (such deferral of Guarantor’s subrogation and contribution rights, the
“Subrogation Deferral”).
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(c) 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 Buyer, that: (a) Guarantor’s rights of
subrogation against Seller or Buyer and Guarantor’s right of subrogation against
any Security shall at all times be junior and subordinate to Buyer’s rights
against Seller and to Buyer’s right, title, and interest in such Security; and
(b) Guarantor’s right of contribution against any Co-Guarantor shall be junior
and subordinate to Buyer’s rights against such Co-Guarantor.
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 Buyer,
without consideration, pursuant to documentation fully satisfactory to Buyer.
Guarantor shall automatically be deemed to have assigned and transferred such
claim to Buyer whether or not Guarantor executes documentation to such effect.
By executing this Guaranty, Guarantor hereby authorizes Buyer (and grants Buyer
a power of attorney coupled with an interest, and hence irrevocable) to execute
and file such assignment and transfer documentation on Guarantor’s behalf. Buyer
shall have the sole right to vote, receive distributions, 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 Buyer 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 Buyer
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 Buyer
could (on account of Insolvency Proceedings, whether or not then pending,
affecting Seller, any Co-Guarantor, 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 calendar year or other fiscal year of
Guarantor (or within five business days after filing, in the case of tax
returns) and within forty-five days after the end of each of the first three
calendar quarters, and within fifteen business days after Buyer’s request made
at any time or from time to time, Guarantor shall deliver to Buyer: (a) complete
and current financial statements of Guarantor (audited for the annual financial
statements and unaudited for the financial statements of the first three
calendar quarters), in form and scope reasonably satisfactory to Buyer; (b)
copies of Guarantor’s tax returns; and (c) such other financial information
relating to Guarantor as Buyer may reasonably request.
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, as Buyer may select from time
to time. By executing this Guaranty, Guarantor irrevocably accepts and submits
to the nonexclusive personal jurisdiction of each of the aforesaid courts,
generally and unconditionally with respect to any such Proceeding. Guarantor
agrees not to assert any basis for transferring jurisdiction of any such
proceeding to another court. Guarantor further agrees that a final judgment
against Guarantor in any Proceeding shall be conclusive evidence of Guarantor’s
liability for the full amount of such judgment.
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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 Buyer’s written agreement. 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 solely by New York internal law (disregarding such
state’s law on conflict of laws) 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 Buyer’s
recovery of a judgment against Guarantor if the Security were located in New
York State shall have absolutely no application to Buyer’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. In the event of any
Proceeding between Seller or Guarantor and Buyer, including any Proceeding
in
which Buyer enforces or attempts to enforce this Guaranty or the Repurchase
Transactions against Seller or Guarantor, or in the event of any Guarantor
Litigation, Guarantor shall reimburse Buyer for all Legal Costs of such
Proceeding.
19. Fundamental
Changes.
Guarantor shall not wind up, liquidate, or dissolve its affairs or enter into
any transaction of merger or consolidation (except a transaction of merger
or
consolidation in accordance with the Repurchase Agreement), or sell, lease,
or
otherwise dispose of (or agree to do any of the foregoing) all or substantially
all of its property or assets, or change its state of formation or entity
status, without Buyer’s prior written consent.
20. Further
Assurances.
Guarantor shall execute and deliver such further documents, and perform such
further acts, as Buyer may 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 Repurchase Documents.
21. Supplemental
Provisions.
(a) Other
Guaranties.
This
Guaranty is in addition to and independent of any guaranty(ies) executed by
any
Co-Guarantors and any other guaranties of Seller’s obligations executed by
Guarantor in favor of Buyer. This Guaranty shall in no way limit or lessen
any
other liability, arising in any way, that Guarantor may have for the payment
of
any indebtedness of Seller to Buyer.
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(b) Multiple
Guarantors.
If more
than one person or entity has executed this Guaranty (or any other guaranty
of
the Repurchase Transactions), then all such persons and entities shall be
jointly and severally liable under this Guaranty. Guarantor shall hold harmless,
defend, protect, and indemnify Buyer from any Legal Costs and all other claims
of every nature that may arise as a result of any dispute between or among
any
or all of Guarantor, Seller, any Co-Guarantors, and any other persons or
entities.
(c) Certain
Entities.
If
Seller or Guarantor is a partnership, limited liability company, or other
unincorporated association, then: (a) Guarantor’s liability shall not be
impaired by changes in the name or composition of Seller or Guarantor; and
(b)
the withdrawal or removal of any partner(s) or member(s) of Seller or Guarantor
shall not diminish Guarantor’s liability or (if Guarantor is a partnership) the
liability of any withdrawing general partner of Guarantor.
(d) Status
of Seller.
If this
Guaranty defines more than one person as Seller, then any reference to Seller
means any one or all of them, whether their liability is joint or
several.
(e) Counterparts.
This
Guaranty may be executed in counterparts. The effectiveness of this Guaranty
against each Guarantor executing this Guaranty is not conditioned upon execution
and/or delivery of this Guaranty by any Co-Guarantor.
22. WAIVER
OF TRIAL BY JURY. GUARANTOR WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING
ARISING FROM OR RELATING TO THIS GUARANTY OR THE REPURCHASE DOCUMENTS OR ANY
OBLIGATION(S) OF GUARANTOR HEREUNDER OR UNDER THE REPURCHASE
DOCUMENTS.
23. Miscellaneous.
(a) Assignability.
Buyer
may assign this Guaranty (in whole or in part) together with any one or more
of
the Repurchase Documents to any Person permitted under the Repurchase Agreement,
without in any way affecting Guarantor’s or Seller’s liability. Upon request in
connection with any such assignment Guarantor shall deliver such documentation
as Buyer shall reasonably request. Buyer may from time to time designate any
Buyer Entity to hold and exercise any or all of Buyer’s rights and remedies
under this Guaranty. This Guaranty shall benefit Buyer and its successors and
assigns (including any Buyer Entity) and shall bind Guarantor and its heirs,
executors, administrators and successors. Guarantor may not assign this
Guaranty, in whole or in part.
(b) 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 (a) hand delivery, with proof of attempted delivery, (b) certified
or
registered United States mail, postage prepaid, (c) expedited prepaid delivery
service, either commercial or United States Postal Service, with proof of
attempted delivery, or (d) by telecopier (with answerback acknowledged) provided
that such telecopied notice must also be delivered by one of the means set
forth
in (a), (b) or (c) above, addressed if to Buyer at 00 Xxxx Xxxxxx, Xxx Xxxx,
Xxx
Xxxx 00000, Attention: Xxxxxxx Xxxx, Telecopier Number (000)
000-0000,
and if
to Guarantor at 00 Xxxx 00xx
Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Xxxx, Telecopier Number (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 shall be delivered concurrently to the following: Dechert LLP, 4000
Xxxx
Atlantic Tower, 0000 Xxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000, Attention: Xxxxxxx
Xxxxx, Esquire, Telefax Number: 215.994.2222. A notice shall be deemed to have
been given: (a) in the case of hand delivery, at the time of delivery, (b)
in
the case of a registered or certified mail, when delivery or the first attempted
delivery on a Business Day, (c) in the case of expedited prepaid delivery upon
the first attempted delivery on a Business Day, or (d) in the case of
telecopier, upon receipt of answerback confirmation, provided that such
telecopied 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.
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(c) Interpretation.
The word
“include” and its variants shall be interpreted in each case as if followed by
the words “without limitation.”
24. 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 Buyer (directly or acting through its counsel) makes any demand
or
commences any action to enforce this Guaranty.
25. No
Third-Party Beneficiaries.
This
Guaranty is executed and delivered for the benefit of Buyer and its heirs,
successors, and permitted assigns, and is not intended to benefit any third
party.
26. 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)
BUYER 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.
14
IN
WITNESS WHEREOF, Guarantor has duly executed this Guaranty as of the date
indicated below.
| Date: December 23, 2004 | ||
| GUARANTOR | ||
| Anthracite Capital, Inc. | ||
| |
|
|
| By: | /s/ Xxxxxx Xxxxxxxxx | |
|
Name: Xxxxxx Xxxxxxxxx |
||
| Title: Vice President | ||
| Acknowledgment(s) | ||||
| Deutsche Bank AG, Cayman Islands Branch | ||||
| By: | /s/ Xxxxxxxxxxx Xxxxxxx | |||
|
Name: Xxxxxxxxxxx
Xxxxxxx
Title: Vice
President
|
||||
| By: | /s/ Xxxxxxxxx Xxxxxxxx | |||
|
Name: Xxxxxxxxx
Xxxxxxxx
Title: Vice
President
|
| Anthracite Funding, LLC | ||||
| Deutsche Bank AG, Cayman Islands Branch | ||||
| By: | Anthracite Capital, Inc., its sole member | |||
| By: | /s/ Xxxxxx Xxxxxxxxx | |||
|
Name: Xxxxxx
Xxxxxxxxx
Title: Vice
President
|
||||
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